COMPREHENSIVE ANNUAL FINANCIAL REPORT - 2005/2006
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Clearwater
Interoffice Correspondence Sheet
TO: Mayor and City Council
FROM: Margie Simmons, Finance Director,, N.P'
COPIES: Bill Horne, City Manager; Garry Brumback, Assistant City
Manager; Rod Irwin, Assistant City Manager; Pam Akin, City
Attorney; Cyndie Goudeau, City Clerk
SUBJECT: Fiscal Year 2006 Comprehensive Annual Financial Report
DATE: April 3, 2007
Enclosed please find a copy of the City's comprehensive annual financial report
(CAFR) for the year ended September 30, 2006.
The CAFR is broken into four sections: the Introductory Section, which includes a
transmittal letter beginning on page vii; the Financial Section; the Statistical
Section; and the Single Audit & Grants Compliance Section.
The Financial Section includes a "clean" unqualified opinion on the financial
statements from the City's external auditors, beginning on page 1 of the report.
This section also includes Management's Discussion and Analysis (MD&A)
beginning on page 3.
Single audit (federal and state grants) and management letter findings, if any,
would be included in the "Single Audit" section of the CAFR. There were no single
audit or management letter findings for fiscal 2006.
Our external auditors, Cherry, Bekaert & Holland, L.L.P., will be making a brief
official presentation of the CAFR to you at the April 16'h Council Work Session.
If you have any questions, please contact me at 562-4538 or Jay Ravins at 562-
4533.
City of Clearwater, Florida
Comprehensive Annual Financial Report
for Fiscal Year Ended September 30, 2006
a Or
k
Frank V. Hibbard
Mayor
Carlen A. Petersen John P. Doran Hoyt P. Hamilton
Vice Mayor Councilmember Councilmember
William B. Horne II
City Manager
Margaret L. Simmons, CPA
Finance Director
William C. Jonson
Councilmember
Prepared by. City of Clearwater Finance Department
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City of Clearwater, Florida
Comprehensive Annual Financial Report
For the Fiscal Year Ended September 30, 2006
TABLE OF CONTENTS
INTRODUCTORY SECTION:
Title Page and List of Elected and Appointed Officials ........................................................................................ i
Letter of Transmittal .......................................................................................................................................... vii
Certificate of Achievement for Excellence in Financial Reporting ..................................................................... A
Organizational Chart ......................................................................................................................................... xii
FINANCIAL SECTION:
Independent Auditors' Report ............................................................................................................................ 1
Management's Discussion and Analysis ......................................................................................................... .. 3
Basic Financial Statements:
Government-wide Financial Statements:
Statement of Net Assets ....................................................................................................................... 18
Statement of Activities ........................................................................................................................... 19
Fund Financial Statements:
Balance Sheet - Governmental Funds ................................................................................................ 20
Reconciliation of the Balance Sheet of Governmental Funds to the Statement of Net Assets........... 21
Statement of Revenues, Expenditures, and Changes in Fund Balances - Governmental Funds...... 22
Reconciliation of the Statement of Revenues, Expenditures, and Changes in Fund Balances
of Governmental Funds to the Statement of Activities ....................................................................... 23
Statement of Revenues, Expenditures, and Changes in Fund Balances -
Budget and Actual (Non-GAAP Basis) - General Fund .................................................................. 24
Statement of Revenues, Expenditures, and Changes in Fund Balances -
Budget and Actual (GAAP Basis) - Special Development Fund ...................................................... 25
Statement of Net Assets - Proprietary Funds ...................................................................................... 26
Statement of Revenues, Expenses, and Changes in Fund Net Assets - Proprietary Funds ............. 30
Statement of Cash Flows - Proprietary Funds .................................................................................... 34
Statement of Fiduciary Net Assets - Fiduciary Funds ......................................................................... 38
Statement of Changes in Fiduciary Net Assets - Fiduciary Funds ......................................................
39
Notes to the Basic Financial Statements ..................................................................................................... 40
Required Supplementary Information - Pension Trust Funds:
Schedules of Funding Progress ................................................................................................................. 78
Schedules of Employer Contributions ........................................................................................................ 79
Notes to Schedules of Required Pension Supplementary Information ...................................................... 80
Combining and Individual Fund Statements and Schedules:
Combining Balance Sheet - Nonmajor Governmental Funds ................................................................... 84
Combining Statement of Revenues, Expenditures and Changes in Fund Balances -
Nonmajor Governmental Funds ............................................................................................................. 86
Schedule of Revenues, Expenditures, and Changes in Fund Balance -
Budget and Actual (GAAP Basis) - Community Redevelopment Agency Special Revenue Fund ...... 89
Combining Statement of Net Assets - Nonmajor Enterprise Funds .......................................................... 92
Combining Statement of Revenues, Expenses, and Changes in Fund Net Assets -
Nonmajor Enterprise Funds ................................................................................................................... 93
Combining Statement of Cash Flows - Nonmajor Enterprise Funds ......................................................... 94
Combining Statement of Net Assets - Internal Service Funds .................................................................. 98
Combining Statement of Revenues, Expenses, and Changes in Fund Net Assets -
Internal Service Funds ........................................................................................................................... 99
Combining Statement of Cash Flows - Internal Service Funds ..............................................................1 00
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City of Clearwater, Florida
Comprehensive Annual Financial Report
For the Fiscal Year Ended September 30, 2006
I TABLE OF CONTENTS (Continued)
' Combining Statement of Fiduciary Net Assets - Fiduciary Funds ...........................................................
Combining Statement of Changes in Fiduciary Net Assets - Fiduciary Funds ....................................... 104
105
Statement of Changes in Assets and Liabilities - Treasurer's Escrow Agency Fund ............................. 106
Supplementary Information:
Continuing Disclosure - Gas System Revenue Bonds, Series 1997B, 1998, 2004, and 2005 ...............
108
Continuing Disclosure - Water & Sewer Revenue Bonds, Series 1998, 2002, 2003, and 2006............ 113
Continuing Disclosure - Stormwater System Revenue Bonds, Series 1999, 2002, 2004, and 2005..... 116
Continuing Disclosure - Infrastructure Sales Tax Revenue Bonds, Series 2001 ................................... 117
' Continuing Disclosure - Improvement Revenue Refunding Bonds, Series 2001 ................................... 117
Fire Services Program .............................................................................................................................. 118
STATISTICAL SECTION:
Introduction ....................................................................................................................................119
Schedule 1 Net Assets by Component ............................................................................................................. 121
Schedule 2 Changes in Net Assets ..................................................................................................................
Schedule 2a Program Revenues by Function/Program .................................................................................... 122
124
Schedule 3 Fund Balances of Governmental Funds ........................................................................................ 125
' Schedule 4 Changes in Fund Balances of Governmental Funds .....................................................................
Schedule 5 Assessed Value and Estimated Actual Value of Taxable Property ............................................. 126
127
Schedule 6 Direct and Overlapping Properly Tax Rates ................................................................................. 128
Schedule 7 Property Tax Levies and Collections ............................................................................................. 129
Schedule 8a Principal Real Property Taxpayers ................................................................................................ 130
' Schedule 8b Principal Personal Property Taxpayers ......................................................................................... 131
Schedule 9 Ratios of Outstanding Debt by Type .............................................................................................. 132
Schedule 10 Ratios of General Bonded Debt Outstanding ................................................................................
Schedule 11 Direct and Overlapping Governmental Activities Debt .................................................................. 133
134
Schedule 12 Legal Debt Margin Information ...................................................................................................... 135
Schedule 13 Pledged-Revenue Coverage .........................................................................................................
Schedule 14 Demographic and Economic Statistics .......................................................................................... 136
138
' Schedule 15 Principal Employers .......................................................................................................................
Schedule 16 Full-time Equivalent City Government Employees by Function/Program .....................................
Schedule 17 Operating Indicators by Function/Program ....................................................................................
Schedule 18 Capital Asset Statistics by Function/Program ............................................................................... 139
140
141
142
SINGLE AUDIT/ GRANTS COMPLIANCE SECTION:
Independent Auditors' Report On Internal Control Over Financial Reporting And On Compliance
And Other Matters Based On An Audit of Financial Statements Performed In Accordance
' With Government Auditing Standards ................................................................................................................
Independent Auditors' Report On Compliance With Requirements Applicable To Each Major Federal
Awards Program And State Financial Assistance Projects And Internal Control Over Compliance
In Accordance With OMB Circular A-133 And Chapter 10.550, Rules Of The Auditor General .......................
Schedule of Expenditures of Federal Awards and State Financial Assistance ....................................................
Notes to Schedule of Expenditures of Federal Awards and State Financial Assistance .......................................
Schedule of Findings and Questioned Costs .........................................................................................................
Independent Auditors' Management Letter ............................................................................................................ 145
147
149
152
153
155
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?C-2 ---
??•?'ATER,;?o
CITY MANAGER
t
CITY OF C LEARWATE R
POST CIFFICE BOX 4748, CLEARWATER, FLORIDA 33758-4748
CriY 1 1L1,, 112 SOUTH OsuoIA AVENUE, CLEARWATER, FLORIDA 33756
TELEPHONE (727) 562-4040 FAx (727) 562-4052
March 30, 2007
The Honorable Mayor, Councilmembers,
and Citizens of the City of Clearwater:
The City of Clearwater Charter (Section 2.01(c)3), Florida Statutes, and various covenants relating to
debt and pension obligations of the City require an annual audit of the City's financial statements of all
funds of the City by a firm of licensed certified public accountants. These statements must be
presented in conformity with generally accepted accounting principles (GAAP) and audited in
accordance with generally accepted auditing standards. Pursuant to these requirements we hereby
issue the comprehensive annual financial report of the City of Clearwater for the fiscal year ended
September 30, 2006.
This report consists of management's representations concerning the finances of the City.
Consequently, management assumes full responsibility for the completeness and reliability of all of the
information presented in this report. To provide a reasonable basis for making these representations,
management of the City has established a comprehensive internal control framework that is designed
both to protect the government's assets from loss, theft, or misuse and to compile sufficient reliable
information for the preparation of the City's financial statements in conformity with GAAP. Because the
cost of internal controls should not outweigh their benefits, the City's comprehensive framework of
internal controls has been designed to provide reasonable rather than absolute assurance that the
financial statements will be free from material misstatement. As management, we assert that, to the
best of our knowledge and belief, this financial report is complete and reliable in all material respects.
Cherry, Bekaert & Holland L.L.P., a firm of licensed certified public accountants, has audited the City's
financial statements. The goal of the independent audit was to provide reasonable assurance that the
financial statements of the City for the fiscal year ended September 30, 2006, are free of material
misstatement. The independent audit involved examining, on a test basis, evidence supporting the
amounts and disclosures in the financial statements; assessing the accounting principles used and
significant estimates made by management; and evaluating the overall financial statement
presentation. The independent auditor concluded that there was a reasonable basis for rendering an
unqualified opinion that the City's financial statements for the fiscal year ended September 30, 2006,
are fairly presented in conformity with GAAP. The independent auditor's report is presented as the first
component of the financial section of the report.
The independent audit of the financial statements of the City was part of a broader, federally mandated
"Single Audit' designed to meet the special needs of federal and state grantor agencies. The
standards governing Single Audit engagements require the independent auditor to 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 and state awards. These reports are in the Single
Audit section of this report.
FRANK I IIRBARD, MAYOR
JOHN DORAN, COUNCIL MEMBER J.B. JOHNSON, COUNCILMENIBER
E3111JONSON, COUNCIUME.MBER ?CARLEN A. PFTERSFN, COUNCILIMEMBER
V13.
"EQUAL FNIPLOYNIF.NT AND AFFIRNIA'Nvli AcHON EMPLOYER"
GAAP requires that management provide a narrative introduction, overview, and analysis to
accompany the basic financial statements in the form of the Management's Discussion and Analysis
M
report (
D&A). This letter of transmittal is designed to complement the MD&A and should be read in
conjunction with it. The City's MD&A can be found immediately following the report of the independent
auditors.
Profile of the City of Clearwater, Florida
Clearwater is located on the Pinellas Peninsula on Florida's west coast. It is directly located on the
Gulf of Mexico, 20 miles west of Tampa and 20 miles north of St. Petersburg. Clearwater is the county
seat of Pinellas County and one of the largest cities in the Tampa Bay area. The Clearwater area offers
a semitropical climate and 28 miles of beautiful beaches. Consequently, tourism is an important
component of the economy. In addition to tourism, Clearwater enjoys a diversity of manufacturing
businesses, service industries, high-tech companies, and a large retirement population.
The Cit
t
d ,
y opera
es un
er the council/manager form of government. Policymaking and legislative
authority are vested in the City Council, which consists of a mayor and four members elected at large
on a non-partisan basis. The City Council is responsible for adopting ordinances, adopting the budget,
and hiring the City Manager and City Attorney. The City Manager is responsible for carrying out the '
policies and ordinances of the City Council, for overseeing the day-to-day operations of the City, and
for appointing the heads of the City's departments.
Th
e City provides police and fire protection; construction and maintenance of streets, bridges,
sidewalks, storm drainage, public parks, and recreation facilities; planning, zoning, subdivision, and
building code regulation and enforcement; redevelopment of commercial and residential '
neighborhoods; supervised recreation programs; public libraries; water supply and distribution; waste
water collection, treatment, and disposal; natural gas distribution; solid waste collection and recycling;
stormwater management; marina, airpark, convention center, and public fishing pier operations; and
operation of the city-wide parking system. '
The annual budget serves as the foundation for the City's financial planning and control. Per the City
Code of Ordinances, the City Manager is required to provide to the City Council an operating budget for
the ensuing fiscal year, a capital improvement budget, and a five-year capital improvement program,
along with an accompanying budget message no later than 60 days prior to the end of the fiscal year.
The Council is required to hold public hearings on the budget and to adopt a final operating budget and
capital improvement budget no later than September 30, the last day of the City's fiscal year. The
appropriated budget is prepared by fund and by department within fund.
Factors Affecting Financial Condition '
The information presented in the financial statements is perhaps best understood when it is considered
from the broader perspective of the specific environment within which the City operates.
Local Economy
The Tampa Bay metropolitan area economy continues to improve. The unemployment rate improved
from 3.7 percent for September 2005 to 3.2 percent for September 2006. The national average for
September 2006 was 4.6 percent unemployment versus 5.1% for September 2005. Business
development interest in the City's downtown and beach areas has continued to increase significantly in
recent years as property valuation increases reflect. We are also seeing a continued interest in the
City's markets for multi-family and residential housing.
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Long-term Financial Planning
A major project completed during fiscal 2006 was $15.8 million of stormwater drainage and roadway
improvements to downtown's Myrtle Avenue. The improvements will significantly improve stormwater
drainage and help relieve traffic congestion in the downtown area. Additionally, fiscal 2006 saw the
continuation of $7.5 million of Glen Oaks stormwater improvements, to include a lakefront community
park and soccer fields while removing approximately 100 homes from the Stevenson Creek floodplain.
Fiscal 2006 also marked the beginning of construction of the new downtown streetscape, an important
step in the redevelopment and revitalization of downtown. Finally, the year also welcomed the
beginning of construction of Beach Walk, a $30 million project that promises to redefine the face of
Clearwater Beach. The project includes winding promenades, lush landscaping, and amenities such as
whimsical showers, cool places to relax, and distinctive artistic touches that will reinvent the Clearwater
tourist experience. The Beach Walk project is expected to be completed during fiscal 2009.
An important future City initiative is construction of proposed boat slips for the downtown waterfront.
The $11 million project will include up to 140 boat slips, over 2,500 feet of "side-tie" moorings for
overnight and day visits, and will coordinate with a pedestrian promenade. The project is an important
component of downtown and beach redevelopment efforts and will enhance community access to
Clearwater's waterfront. Construction is forecast to begin in fiscal 2008 with project completion
expected during fiscal 2009.
Cash Management Policies and Practices
As more completely described in Note I (D)(1) of the notes to the financial statements, the City employs
a consolidated cash pool to facilitate short-term investment of liquid assets for all City funds. The City
believes that a conservative investment philosophy best serves the residents of Clearwater, and that
the return of the investment principal is more important than the return on the principal. However, the
City attempts to maximize the return, while maintaining a conservative philosophy, via accurate cash
flow forecasting and competitive selection of investments. The cash pool earned an average rate of
return of 4.15% on its investments during fiscal year 2006.
Risk Management
The City is self-insured within certain parameters for losses arising from claims for general liability, auto
liability, police professional liability, public officials' liability, property damage, and workers'
compensation. The transactions relating to the self-insurance program are accounted for in the Central
Insurance Fund, and are reported as an Internal Service Fund. The City is not self-insured with respect
to major medical coverage. Management believes that the amounts showing as claims payable and the
unreserved retained earnings are adequate to cover all reasonable projected losses arising from
events occurring on or prior to September 30, 2006. Additional information on the City's risk
management activity can be found in Note IV (A) of the notes to the financial statements.
Pension
The Employees' Pension Plan and the Firemen's Pension Plan are single-employer defined benefit
pension plans that are self-administered by the City. Each year, independent actuaries engaged by the
pension plans calculate the amount of the minimum required contributions that the City must make to
each of the plans to ensure that the plans will be able to fully meet their obligations to retired
employees on a timely basis. City contributions for the year were in accordance with actuarially
determined funding requirements.
In addition, supplemental pensions exist for certified Police Officers and Firefighters under the
provisions of Florida Statutes Sections 175 and 185. These plans are funded solely from excise taxes
on certain insurance premiums covering property in Clearwater. The excise taxes are collected by the
state and remitted to the City. Both plans require benefits to be adjusted to equal fund assets provided
by the defined contributions.
Additional information on the City's pension plans can be found in Note IV (D) of the notes to the
financial statements.
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Awards and Acknowledgements
The Government Finance Officers Association (GFOA) awarded a Certificate of Achievement for
Excellence in Financial Reporting to the City for its comprehensive annual financial report (CAFR) for
the fiscal year ended. September 30, 2005. This was the twenty-seventh consecutive year that the City
received this prestigious award. In order to be awarded a Certificate of Achievement, the government
published an easily readable and efficiently organized CAFR. This report satisfied both GAAP and
applicable legal requirements. A Certificate of Achievement is valid for a period of one year only. We
believe that our current CAFR continues to meet the Certificate of Achievement. Program's
requirements and we are submitting it to the GFOA to determine its eligibility for another certificate.
In addition, the City received the GFOA's Distinguished Budget Presentation Award for the fiscal year
2007 Budget document, the twenty-first consecutive year that this award has been received. In order to
qualify, the City's Budget document was judged to be proficient in several categories including as a
policy document, a financial plan, an operations guide, and a communications device.
We wish to thank the many members of the Citywide Annual Financial Reporting (CAFR) team, which
is composed of individuals in the Finance Department and other financial staff throughout the City, for
their professionalism and dedication in producing this report. In addition, we thank the Graphic
Communications Division for the professional printing of this report. Sincere appreciation is also
extended to the City's external auditors, Cherry, Bekaert & Holland, L.L.P., for their advice and
assistance in the preparation of this report. Finally, we would like to thank the City Council for their
interest, continued support, and leadership in planning and conducting the financial operations of the
City in a progressive and responsible manner.
Sincerely,
William B. H1, 0&?
City Manager
Margaret L. Simmons, CPA
Finance Director
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? Certificate of
Achievement
? for Excellence
in Financial
? Reporting
Presented to
? City of Clearwater
Florida
For its Comprehensive Annual
Financial Report
for the Fiscal Year Ended
September 30, 2005
A Certificate of Achievement for Excellence in Financial
Reporting is presented by the Government Finance Officers
Association of the United States and Canada to
government units and public employee retirement
systems whose comprehensive annual financial
reports (CAFRs) achieve the highest
standards in government accounting
and financial reporting.
1
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SEU s President
*1?oe 44-1qAWz,;,
Executive Director
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Citizens of Clearwater
City Council
City Manager
City Attorney's Office
City Audit I I I Emergency
Manager
Equity
Services
Fire
Department
Police
Department
Engineering
Public Services
Public Utilities
I Assistant City
Manager
Assistant City
Manager
Development an
Neighborhood ce o
Management and mer
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Services
Bud et Service
Library Finance conomiE
H Developme
Housin Serv
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Parks and
Recreation Human Resources Gas System
Planning Information and
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Technology vViafion
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Public
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General
Services
Services
Public
Communications
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Independent Auditors' Report
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Honorable Mayor, City Councilmembers,
City Manager and City Management
City of Clearwater, Florida
We have audited the accompanying financial statements of the governmental activities, the business-type
activities. each major fund, and the aggregate remaining fund information of the City of Clearwater,
Florida (the "City"), as of and for the year ended September 30, 2006, which collectively comprise the
City's basic financial statements as listed in the table of contents. We have also audited the financial
statements of each of the City's non-major governmental and non-major enterprise, internal service and
fiduciary funds presented as supplementary information in the accompanying combining and individual
fund financial statements as of and for the year ended September 30, 2006, as listed in the table of
contents. These financial statements are the responsibility of the City's management. 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 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 basic financial statements are free of material
misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and
disclosures in the financial statements. An audit also includes assessing the accounting principles used
and significant estimates made by management, as well as evaluating the overall financial statement
presentation. We believe that our audit provides a reasonable basis for our 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 as of September 30. 2006, and. the respective
changes in financial position and cash flows, where applicable, thereof and the respective budgetary
comparisons for the general fund and the special development fund, for the year then ended, in
conformity with accounting principles generally accepted in the United States of America. In addition, in
our opinion, the financial statements referred to above present fairly. in all material respects, the
respective financial position of each non-major governmental, non-major enterprise, internal service, and
fiduciary funds of the City of Clearwater. Florida as of September 30, 2006, and the respective changes in
financial position and cash flows. where applicable, thereof for the year then ended, in conformity with
accounting principles generally accepted in the United States of America.
As discussed in Note 11-B to the basic financial statements, the City adopted the retroactive provisions for
infrastructure accounting prescribed by Statement 34 of the Governmental Accounting Standards Board,
Basic Financial Statements - and Management's Discussion and Analysis - for State and Local
Governments, as of October 1, 2004.
In accordance with Government Auditing Standards, we have also issued our report dated March 26, 2007
on our consideration of the City's internal control over financial reporting and 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 the internal control over
financial reporting or on compliance. That report is an integral part of an audit performed in accordance
with Government Auditing Standards and should be considered in assessing the results of our audit.
The management's discussion and analysis and the schedules of funding progress and employer
contributions of the Pension Trust Funds as listed in the table of contents is not a required part of the
basic financial statements but is supplementary information required by accounting principles generally
accepted in the United States of America. We have applied certain limited procedures, which consisted
principally of inquiries of management regarding the methods of measurement and presentation of the
required supplementary infonmation. However, we did not audit the information and express no opinion
on it.
Our audit was conducted for the purpose of forming opinions on the financial statements that collectively
'
comprise the City
s basic financial statements and on each of the City's non-major governmental, non-
major enterprise, internal service, and fiduciary funds. The accompanying supplementary information
listed in the table of contents is presented for purposes of additional analysis and is not a required part of
the basic financial statements. In addition, the accompanying schedule of expenditures of federal awards
and state financial assistance and other schedules is presented for purposes of additional analysis as
required by the U.S. Office of Management and Budget Circular A-133, Audits of States, Local
Governments, and Non-Profit Organizations, and Chapter 10.550, Rules of the Auditor General, and is
also not a required part of the basic financial statements. The schedule of expenditures of federal awards
and state financial assistance and other schedules has been subjected to the auditing procedures applied in
the audit of the basic financial statements and, in our opinion, are fairly stated in all material respects in
l
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a
on to t
e
as
c
nanc
al statements taken as a whole. The introductory and statistical sections of this
report have not been subjected to the auditing procedures applied in the audit of the basic financial
statements and, accordingly, we express no opinion on them.
0LA,- W/, ALza" ii-
St. Petersburg, Florida
March 26, 2007
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Management's Discussion and Analysis
This Management's Discussion and Analysis report provides the reader with a narrative overview and analysis of the
financial activities of the City for the fiscal year ended September 30, 2006. Management's Discussion and Analysis
(MD & A) should be read in conjunction with the City's Transmittal Letter, which begins on page vii of this report.
Financial Highlights
The City's assets exceeded its liabilities at the close of fiscal year 2006 by $595.5 million (net assets). Of this amount,
$177.7 million (unrestricted net assets) may be used to meet the government's ongoing obligations to citizens and
creditors.
The City's total net assets increased by $34.8 million, or 6.2%, during fiscal 2006. Net assets for governmental activities
increased by $17.8 million, or 5.8%, while the business-type net assets increased by $17.0 million, or 6.7%.
Significant factors contributing to the $17.8 million increase in governmental net assets included: an increase in net
assets related to current year accumulation of funds for major capital projects, including $3.0 million towards a new
main fire station and $3.1 million towards downtown streetscaping; a $3.6 million passback from the internal service
funds of governmental activities' share of the current year increase in net assets of the internal service funds; and a
$5.8 million General Fund budgetary variance of actual results versus original budget, due to revenues in excess of
budget, and expenditures less than budget, as discussed in the General Fund budgetary analysis that follows.
I The $17.0 million increase in business-type net assets is the result of operating revenues in excess of operating
expenses for all major enterprise funds, as well as current year capital grants and contributions of $6.3 million for Water
and Sewer system and Stormwater system improvements.
At September 30, 2006, the City's governmental funds reported combined ending fund balances of $107.2 million, an
increase of $13.5 million (or 14.4%) in comparison with the prior year. Of this amount, $68.9 million (or 64.3%) is
available for spending at the government's discretion (unreserved fund balance). The increase of $13.5 million in
governmental fund balances is primarily the result of a $6.0 million surplus in the Capital Improvement capital project
fund, due to current year funding of major capital projects, including $3.0 million towards a new main fire station and
$3.1 million towards downtown streetscaping; along with a current year General Fund surplus of $5.8 million, as the
result of revenues in excess of budget along with expenditure savings as discussed in the General Fund budgetary
analysis that follows.
At September 30, 2006, unreserved fund balance for the General Fund was $21.5 million, or 20.5% of total current year
general fund expenditures.
Total actual revenues for the General Fund for fiscal 2006 were $3.0 million, or 2.7%, greater than final budgeted
revenues. Some of the mayor factors contributing to this surplus of revenues in excess of final budgeted revenues
include: utility tax revenues $454,000, or 4.2%, greater than final budget due to increases in electric utility taxes;
franchise fees totaling $429,000, or 4.8%, in excess of budgeted franchise fees; $417,000, or 13.0%, of state revenue
sharing proceeds in excess of final budget revenues due to increased state collections of Sales and Use Tax and One
Cent Municipal Fuel Tax; interest income in excess of final budget by $402,000, or 45.8%, due to improved market
interest rates; communications services taxes $307,000, or 4.7%, greater than final budget; and licenses, permits and
fees $249,000, or 4.9%, greater than budget due to increases in building permit fees resulting from increased
development activity.
Total fiscal 2006 actual expenditures for the General Fund were less than final budgeted expenditures by $0.9 million,
or 0.9%. This was due to relatively minor budget savings across numerous City departments for fiscal 2006.
Finally, actual General Fund interfund transfers in were $0.4 million, or 6.4%, greater than final budgeted interfund
transfers in, while actual General Fund interfund transfers out were $0.2 million, or 2.3%, less than final budgeted
interfund transfers out. The total combined General Fund fiscal 2006 budgetary savings per above was $4.3 million.
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Overview of the Financial Statements
This discussion and analysis (MD&A) is intended to serve as an introduction to the City of Clearwater's basic financial
statements. The City's basic financial statements are comprised of three components: 1) government-wide financial
statements, 2) fund financial statements, and 3) notes to the financial statements. This report also contains other
supplementary information in addition to the basic financial statements themselves.
Government-Wide Financial Statements
The government-wide financial statements are the statement of net assets and the statement of activities. These
statements report information about the City as a whole using accounting methods similar to those used by private-
sector businesses. Emphasis is placed on the net assets of governmental activities and business-type activities, and the
change in net assets. Governmental activities are principally supported by taxes and intergovernmental revenues.
Governmental activities include most of the City's basic services, including police, fire, public works, parks and
recreation, and general administration. Business-type activities are intended to recover all or a significant portion of their
costs through user fees and charges. The City's water and sewer system, stormwater system, gas system, solid waste,
recycling, marine, aviation, convention center, and parking system operations are reported as business-type activities.
• The statement of net assets presents information on all of the City's assets and liabilities, with the difference
between the two reported as net assets. Over time, increases or decreases in net assets may serve as a useful
indicator as to whether the financial position of the City is improving or deteriorating. Net assets are reported in
three major categories: 1) invested in capital assets, net of related debt; 2) restricted; and 3) unrestricted.
• The statement of activities presents information showing how the City's net assets changed as a result of the
'
s activities. All changes in net assets are recorded in the period in which the underlying event takes place,
year
which may differ from the period in which cash is received or disbursed. The Statement of Activities displays the
expense of the City's various programs net of related revenues, as well as a separate presentation of revenues
available for general purposes.
The government-wide financial statements include not only the City of Clearwater itself but also the Clearwater
Redevelopment Agency (CRA). The CRA, though legally separate, is reported as part of the primary government as a
blended component unit due to the City Council serving as the CRA's governing board.
Fund Financial Statements
A fund is a grouping of related accounts that is used to maintain control over resources that have been segregated for
specific activities or objectives. The fund financial statements provide detailed information about the City's major funds -
not the City as a whole. Fund accounting helps to ensure and demonstrate compliance with finance-related legal
requirements. Based on restrictions on the use of monies, the City has established many funds that account for the
multitude of services provided to residents. These fund financial statements focus on the City's most significant funds:
governmental, proprietary, and fiduciary.
Governmental funds
Governmental funds are used to report most of the City's basic services. These funds are used to account for
essentially the same functions reported as governmental activities in the government-wide financial statements. The
funds focus on the inflows and outflows of current resources and the balances of spendable resources available at the
end of the fiscal year. Such information may be useful in evaluating a government's near-term financing requirements.
Because the focus of governmental funds is narrower than that of the government-wide financial statements, it is useful
to compare the information presented for governmental funds with similar information presented for governmental
activities in the government-wide financial statements. By doing so, readers may better understand the long-term impact
of the government's near-term financing decisions. Both the governmental fund balance sheet and the governmental
fund statement of revenues, expenditures, and changes in fund balances provide a reconciliation to facilitate this
comparison between governmental funds and governmental activities.
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The City maintains ten individual governmental funds. Information is presented separately in the governmental funds
balance sheet and in the governmental funds statement of revenues, expenditures, and changes in fund balances for
the General, Special Development, and Capital Improvement funds, which are considered to be major funds. Data from
the other seven governmental funds are combined into a single aggregated columnar presentation. Individual fund data
for each of these nonmajor governmental funds is provided in the form of combining statements in the supplementary
information section of this report.
Annual appropriated budgets are adopted for the General Fund, the Special Development Special Revenue Fund, and
the Community Redevelopment Agency Special Revenue Fund. Budgetary comparison statements and/or schedules
have been provided for these funds to demonstrate budgetary compliance.
Proprietary funds
The City maintains two different types of proprietary funds. Enterprise funds are used to report the same functions
presented as business-type activities in the government-wide financial statements. The City uses enterprise funds to
account for the fiscal activities related to water and sewer, gas, solid waste and stormwater utilities, along with recycling,
marine, aviation, parking system, and convention center operations. Internal service funds are an accounting device
used to accumulate and allocate costs internally among the City's various functions. The City uses internal service
funds to account for the City's building maintenance, custodial services, self-insurance program, risk management
program, employee group insurance, vehicle acquisition and maintenance, and various support activities including data
processing, legal, telecommunications, postal, and printing services. All of the City's internal service funds
predominantly benefit governmental activities and consequently have been aggregated and included within
governmental activities in the government-wide financial statements.
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Proprietary funds provide the same type of information as the government-wide financial statements, only in more detail.
The proprietary fund financial statements provide separate information for the Water and Sewer Utility, Gas Utility, Solid
Waste Utility, and Stormwater Utility enterprise funds, which are considered to be majorfunds of the City. The remaining
four non-major enterprise funds are combined into a single aggregated presentation in the proprietary fund financial
statements. Similarly, governmental activity internal service funds are aggregated into a single presentation. Individual
fund data for the non-major enterprise funds and the internal service funds is provided in the form of combining
statements in the supplementary information section of this report.
Fiduciary funds
Fiduciary funds are used to account for resources held for the benefit of parties outside the government. Fiduciary funds
are not reflected in the government-wide financial statements because the resources of the fiduciary funds are not
available to support the City's own programs. The accounting used for fiduciary funds is similar to proprietary funds.
Notes to the Financial Statements
The notes to the financial statements provide additional information that is essential for a full understanding of the
information provided in the government-wide and fund financial statements, including the City's progress in funding its
obligation to provide pension benefits to its employees.
Other Information
In addition to the basic financial statements and accompanying notes, this report also presents certain required
supplementary information concerning the City's progress in funding its obligation to provide pension benefits to its
employees.
The combining statements referred to earlier in connection with non-major governmental funds, non-major enterprise
funds, and internal service funds, are presented immediately following the required supplementary information.
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Government-Wide Financial Analysis I
The overall financial position of the City improved in both the fiscal 2006 and fiscal 2005 years. As noted earlier, net
assets may serve over time as a useful indicator of a government's financial position. In the case of the City, assets
exceeded liabilities by $595.5 million at the close of the fiscal year ended September 30, 2006. This represents an
increase of $34.8 million over the September 30, 2005 total net assets of $560.7 million. Net assets of both the
governmental and the business-type activities increased primarily due to operating results. Operating and capital grants
and contributions in excess of $17 million also contributed to the increase. Finally, a significant improvement in interest
and investment earnings due to improved market interest rates also contributed to the increase. The City reports
positive balances in all three categories of net assets, both for the government as a whole as well as for its separate
governmental and business-type activities, for both the current year and the prior year, as indicated in the following
table:
City of Clearwater - Net Assets
Primary Government
Governmental Activities Business-type Activities Total
(as restated) (as restated)
2006 2005 2006 2005 2006 2005
Assets
Current and other assets $ 164,288,995 $ 152,437,449 $ 153,803,981 $ 144,066,179 $ 318,092,976 $ 296,503,628
Capital assets 243,789,933 244,134,140 342,254,874 317,017,775 586,044,807 561,151,915
Total assets 408,078,928 396,571,589 496,058,855 461,083,954 904,137,783 857,655,543
Liabilities
Current and other liabilities 7,053,406 7,723,128 14,007,056 16,197,025 21,060,462 23,920,153
Long-term debt outstanding:
Due within one year 13,576,757 13,589,844 9,979,774 9,808,257 23,556,531 23,398,101
Due in more than one year 62,476,423 68,075,018 201,590,438 181,593,152 264,066,861 249,668,170
Total liabilities 83,106,586 89,387,990 225,577,268 207,598,434 308,683,854 296,986,424
Net assets:
Invested in capital assets,
net of related debt 184,798,564 179,777,014 156,727,363 146,476,449 341,525,927 326,253,463
Restricted 41,204,075 34,667,776 35,054,134 35,353,622 76,258,209 70,021,398
Unrestricted 98,969,703 92,738,809 78,700,090 71,655,449 177,669,793 164,394,258
Total net assets $ 324,972,342 $ 307,183,599 $ 270,481,587 $ 253,485,520 $ 595,453,929 $ 560,669,119
A large portion of the City's net assets (57.4%) reflects its investment in capital assets (e.g., land, infrastructure, land
improvements, buildings, and equipment), less any related outstanding debt used to acquire those assets. The City
uses these capital assets to provide services to citizens, and consequently these assets are not available for future
spending. Although the City's investment in 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 resources, since the capital assets themselves will not
be used to liquidate these liabilities.
An additional portion of the City's net assets (12.8%) represents resources that are subject to external restrictions on
how they may be used. The remaining balance of unrestricted net assets ($177.7 million or 29.8%) may be used to
meet the government's ongoing obligations to citizens and creditors.
There was a $5.0 million increase in invested in capital assets, net of related debt for governmental activities. This was
due to $6.6 million decrease in related revenue bond debt, due to scheduled principal payments, offset by a $0.3 million
decrease in governmental activities capital assets and a $1.2 million increase in related capital leases payable.
6
Invested in capital assets, net of related debt for business-type activities increased by $10.3 million primarily due to a
$25.2 million increase in business-type activities net capital assets, offset by a $20.6 million increase in related bonded
debt, less a $4.7 million increase in unspent bond proceeds that are netted against the debt. The increase in net capital
assets was primarily due to Water & Sewer Utility, Gas Utility, and Stormwater Utility system asset additions as detailed
in the Capital Assets discussion section of this report. The increase in bonded debt is due to the current year issuance
of Water and Sewer Utility revenue bonds, less current year scheduled principal payments, as discussed in the Long
Term Debt section of this report. The Water and Sewer Utility revenue bonds issuance is also the cause of the current
year increase in unspent bond proceeds.
Changes in Net Assets
The following table reflects the changes in net assets for the years ended September 30, 2006, and September 30,
2005:
Revenues
Program revenues:
Charges for services
Operating grants and contributions
Capital grants and contributions
General revenues:
Property taxes
Sales taxes
Franchise fees and utility taxes
Othertaxes
Other
Total revenues
Expenses
General Government
Public Safety
Physical Environment
Transportation
Economic Environment
Human Services
Culture and Recreation
Interest on Long-term Debt
Water and Sewer Utility
Gas Utility
Solid Waste Utility
Stormwater Utility
Other
Total expenses
Increase in net assets before
special item and transfers
City of Clearwater, Florida - Changes in Net Assets
Primary Government
Govermental Activities Business-type Activities Totals
2006 2005 2006 2005 2006 2005
$ 28,640,081 $ 26,284,135 $ 134,123,445 $ 122,743,027 $ 162,763,526 $ 149,027,162
7,181,060 6,272,376 59,429 59,318 7,240,489 6,331,694
3,405,482 15,058,058 6,638,780 6,138,128 10,044,262 21,196,186
48,076,050 41,588,595 48,076,050 41,588,595
17,154,748 16,350,790 17,154,748 16,350,790
27,552,445 25,719,255 27,552,445 25,719,255
5,523,351 5,183,332 - - 5,523,351 5,183,332
6,551,538 2,798,998 4,341,509 2,210,089 10,893,047 5,009,087
144,084,755 139,255,539 145,163,163 131,150,562 289,247,918 270,406,101
13,203,133 11,945,245 13,203,133 11,945,245
60,178,290 56,455,771 60,178,290 56,455,771
3,097,392 2,825,805 3,097,392 2,825,805
13,898,269 12,000,935 13,898,269 12,000,935
3,320,950 3,394,903 3,320,950 3,394,903
444,253 529,647 - 444,253 529,647
32,635,470 28,875,199 32,635,470 28,875,199
3,176,290 2,699,538 - - 3,176,290 2,699,538
- - 48,591,560 43,852,341 48,591,560 43,852,341
36,946,956 33,393,976 36,946,956 33,393,976
16,012,769 15,615,274 16,012,769 15,615,274
9,013,014 8,767,984 9,013,014 8,767,984
- - 13,944,762 13,122,737 13,944,762 13,122,737
129,954,047 118,727,043 124,509,061 114,752,312 254,463,108 233,479,355
14,130,708 20,528,496 20,654,102 16,398,250 34,784,810 36,926,746
Transfers 3,658,035 4,707,531 (3,658,035) (4,707,531) - -
Increase in net assets 17,788,743 25,236,027 16,996,067 11,690,719 34,784,810 36,926,746
Net assets - beginning, as restated 307,183,599 281,947,572 253,485,520 241,794,801 560,669,119 523,742,373
Net assets - ending $ 324,972,342 $ 307,183,599 $ 270,481,587 $ 253,485,520 $ 595,453,929 $ 560,669,119
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Governmental Activities
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Governmental activities net assets increased by $17.8 million from $307.2 million as of September 30, 2005, to $325.0
million as of September 30, 2006. This increase due to governmental activities accounted for 51 % of the total increase
in net assets for the City and represented a 5.8% increase in net assets for governmental activities. Key elements of this
increase are as follows:
• Budgeted increases in capital projects funding during the current year, including $3.0 million towards a new
main fire station and $3.1 million towards downtown streetscaping
• A passback from the internal service funds of $3.6 million representing governmental activities' share of the
current year increase in net assets of the internal service funds
• A General Fund surplus of $5.8 million as discussed in the General Fund budgetary analysis that follows.
The cost of all governmental activities this year was $130.0 million. This reflects an $11.3 million, or 9.5%, increase over
the fiscal 2005 total of $118.7 million. However, as shown on the Statement of Activities, the amount that the City's
taxpayers ultimately financed for these activities totaled $90.7 million, because some of the cost was paid for by those
who directly benefited from the programs ($28.6 million) or by other governments and organizations that subsidized
certain programs with grants and contributions ($10.6 million). This total of $90.7 million is an increase of $19.6 million,
or 27.6%, from the fiscal 2005 total of $71.1 million financed from general revenues.
Expenses and Program Revenues - Governmental Activities
For the Year Ended September 30, 2006
Millions
$70
$60
$50
$40
$30
$20
f'
$10 -
$0 -
General Public Safety Physical Transportation Economic Human Culture and Interest on
Government Environment Environment Services Recreation Long-term
Debt
® Expenses ¦ Revenues
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Revenues by Sources - Governmental Activities
For the Year Ended September 30, 2006
Sales taxes
12%
Property taxes
33%
Franchise fees and utility
taxes
19%
Capital grants and
contributions
2%
Other taxes
4%
Operating grants and Other
contributions 5%
5%
Charges for services
20%
Business-type Activities
Net assets for business-type activities increased from $253.5 million to $270.5 million. This increase totaled $17.0
million, reflecting a 6.7% increase in business-type activities net assets and 49% of the total increase in net assets for
the City. The current year increase was $5.3 million greater than the fiscal year 2005 increase in net assets of $11.7
million. The increase of $17.0 million was the result of operating revenues in excess of operating expenses, along with
$6.6 million in current year capital grants and contributions, and current year interest and investment earnings totaling
$4.3 million, offset by $9.0 million in interest expense on long term debt.
Total revenues for business-type activities increased by $14.0 million, or 12.2%, to $145.2 million versus the prior year
total of $131.2 million, due to an increase in charges for services revenue of $11.4 million, or 9.3%, along with a $2.1
million, or 96%, increase in interest and investment earnings. The increase in charges for services was partially due to a
$5.3 million increase in gas system sales versus the previous year as the result of price increases. Also contributing to
the increase in charges for services revenues were stormwater system and water and sewer system rate increases and
related increases in sales of $3.8 million and $0.8 million for the water and sewer utility and the stormwater systems,
respectively. The increase in interest and investment earnings was primarily due to more favorable market interest
rates. Please refer to the discussion of proprietary funds operating results that follows for additional discussion of these
revenues.
Total expenses for business-type activities increased by $9.7 million, or 8.5%, from $114.8 million in fiscal 2005 to
$124.5 million for fiscal 2006. A significant factor contributing to this $9.7 million increase was a $3.1 million, or 16.1%,
increase in gas system purchases for resale as a result of increased fuel costs. Another cause of the increase in
expenses for business-type activities was a 6.1 %, or $1.5 million, increase in personal services expenses, primarily due
to a $1.4 million increase in pension costs. Finally, contributing to the increase in expenses was a $1.2 million, or
25.7%, increase in transportation costs and a $0.5 million, or 19.6%, increase in utility costs as a result of increased fuel
costs.
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Expenses and Program Revenue - Business-type Activities
For the Year Ended September 30, 2006
$60,000,000
$50,000,000
$40,000,000
$30,000,000
$20,000,000
$10,000,000
$0
Water and Sewer
Utility
Revenues by Source - Business-type Activities
For the Year Ended September 30, 2006
Charges for services
91%
Capital grants and
contributions
6%
Other
3%
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Gas Utility Solid Waste Stormwater Utility Other
utility
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Financial Analysis of the City's Funds
As noted earlier, the City uses fund accounting to ensure and demonstrate compliance with finance-related legal
requirements.
Governmental Funds
The focus of the City's governmental funds is to provide information on near-term inflows, outflows, and balances of
spendable resources. Such information is useful in assessing the City's financing requirements. In particular,
unreserved fund balance may serve as a useful measure of a government's net resources available for spending at the
end of the fiscal year. The City reports the General Fund, Special Development Fund, and Capital Improvement Fund
as major governmental funds.
The City's governmental funds for the year ended September 30, 2006, reflect a combined fund balance of $107.2
million versus $93.7 million for the prior year, an increase of $13.5 million. A total of $68.9 million, or 64.3%, represents
unreserved fund balance available for spending at the government's discretion. The remainder of the fund balance is
reserved to indicate that it is not available for new spending because it has already been committed 1) to liquidate
construction contracts and purchase orders of the prior period ($10.5 million); 2) to pay debt service ($6.7 million); 3) for
advances due from other funds ($2.0 million); 4) for land held for resale ($2.0 million); or 5) for specific program
purposes per grant restrictions and related loan agreements ($17.0 million).
The General Fund is the chief operating fund of the City. At September 30, 2006, unreserved fund balance of the
General Fund totaled $21.5 million, with the remainder of the $24.4 million in fund balance "reserved" to indicate it has
already been committed for purchase orders of the prior period ($0.9 million) and for advances due from other funds
($2.0 million). As a measure of the general fund's liquidity it is useful to compare unreserved fund balance to total fund
expenditures. Unreserved fund balance represents 20.5% of total general fund expenditures (GAAP basis before
transfers) for the current fiscal year.
The fund balance of the City's General Fund increased by $5.8 million during the current fiscal year. This increase was
the result of total actual revenues in excess of budgeted revenues by $3.0 million and total actual expenditures less
than budgeted expenditures by a total of $0.9 million. Additionally, actual transfers out (to other funds) was $0.2 million
less than budgeted and actual transfers in (from other funds) was $0.3 million greater than budgeted. Finally, the final
amended budget included an additional $1.5 million excess of revenues and other financing sources over expenditures
and other financing uses versus the original budget, primarily due to increased building permit fees as a result of
redevelopment activity, and increased electric franchise fees due to a fuel-related electric rate increase.
The General Fund revenues in excess of budgeted total of $3.0 million was primarily due to: $0.9 million of utility taxes
and franchise fees in excess of budget, primarily due to increases in electric rates and usage; a $0.4 million, or 13%,
overage in State revenue sharing intergovernmental revenues from increased state collections of sales and fuel taxes;
$0.4 million of interest income in excess of budget due to improved market interest rates; a $0.3 million, or 4.7%, excess
of communications services taxes versus budget; and a $0.25 million overage in licenses, permits, and fees as a result
of increased development activity and related building permit fees. Additional information on the General Fund revenue
surpluses is included in the "General Fund Budgetary Highlights" section on the following pages. General Fund
expenditure "savings" of $0.9 million was spread across numerous departments.
The fund balance of the Special Development Fund increased from $13.7 million to $14.8 million, for an increase of $1.1
million or 7.7%, during the current fiscal year versus an increase of $3.5 million for fiscal 2005. The Special
Development Fund final amended budget indicated a planned increase in fund balance of $0.5 million. Consequently
the actual results of a $1.1 million increase versus a budgeted $0.5 million increase results in a $0.6 million increase in
fund balance versus the final amended budget. This increase is primarily the result of interest income in excess of
budget by $0.9 million due to improved interest rates and higher cash balances.
The fund balance for the Capital Improvement Fund increased from $31.3 million to $37.3 million during the current
fiscal year. This increase of $6.0 million is primarily the result of capital project funding received from other funds ($19.1
million), along with grant revenues received from federal, state, and local agencies ($1.6 million), in excess of current
year capital project expenditures ($14.2 million) and transfers out to other funds for the return of unspent project funding
($1.7 million). This increase reflects the normal volatility in the fund balance of the Capital Improvement Fund due to the
timing of the funding of capital projects versus project expenditures.
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The fund balances for Other (non-major) Governmental Funds increased from $30.0 million to $30.7 million during the
current fiscal year. This increase of $0.7 million was the net result of many offsetting revenue and expenditure increases
and decreases among the various non-major Governmental Funds.
Proprietary Funds
The City's proprietary funds provide the same type of information found in the government-wide financial statements,
but in more detail. The City reports the Water and Sewer Utility Fund, the Gas Utility Fund, the Solid Waste Utility Fund,
and the Stormwater Utility Fund as major funds.
The Water and Sewer Utility Fund realized a $3.0 million increase in net assets versus a $2.8 million increase for the
prior year. Operating expenses increased by $4.9 million, or 12.7%, partially offset by an 8.4%, or $3.8 million increase
in operating revenues. The decrease in fiscal 2006 versus fiscal 2005 operating income of $1.1 million was more than
offset by a $1.0 million increase in investment earnings and a $0.8 million increase in capital grants and contributions.
over the previous year, partially offset by a $0.5 million increase in transfers out to other funds. The increase in
operating expenses was primarily due to an increase in volume of water purchased for resale ($2.5 million) along with
rate increases for water purchased for resale ($0.7 million). Also contributing to the increase in operating expenses was
a $0.5 million increase in utility costs due to electric rate increases, and $0.5 million increase in repairs and
maintenance expenses for system infrastructure maintenance. The increase in operating revenues was the result of a
6% rate increase effective October 1, 2005. The $1.0 million increase in investment earnings was due to improved
market interest rates while the $0.8 million increase in capital grants and contributions was due to increased developer
water impact fees and sewer tap fees related to increased redevelopment activity on the beach and downtown. Finally,
the $0.5 million increase in transfers out was due to an increase in the "payment in lieu of taxes" paid to the general
fund of 5.5% of prior year gross revenues for fiscal 2006 versus 4.5% in fiscal 2005.
The Gas Utility Fund realized a $5.2 million increase in net assets versus a $2.8 million increase for the prior year.
Operating revenues increased by $5.7 million, or 15.3%, over the prior year, primarily due to increased fuel costs;
partially offset by a $3.1 million increase in cost of purchases for resale due to increased cost of natural gas. Also
contributing to the increase in net assets was an improvement in investment earnings from $0.3 million in 2005 to $0.6
million in the current year due to improved market interest rates.
The Solid Waste Utility Fund realized a $0.2 million increase in net assets versus a $0.4 million increase for the prior
year. Operating expenses increased by $0.7 million, or 4.6%, primarily due to a $0.65 million, or 27% increase in
transportation costs due to increased fuel costs. The $0.5 million decrease in operating income from $0.9 million in 2005
to $0.4 million in 2006, was partially offset by a $0.26 million increase in investment earnings due to improved market
interest rates.
The Stormwater Utility Fund realized an increase in net assets of $5.2 million versus a prior year increase of $5.1
million. Operating revenues increased by $0.8 million, or 8.0%, versus the previous year, due to a rate increase of 8.1 %
effective October 1, 2005. The increase in operating revenues was offset by a $0.3 million, or 4.6% increase in
operating expenses, primarily due to increased fuel costs. Additionally, the fund realized an increase in investment
earnings of $0.25 million or 121 % due to improved market interest rates; more than offset by a $0.5 million decrease in
capital grants and contribution due to a decrease in grant revenue related to stormwater capital projects.
Unrestricted net assets and changes in net assets of the proprietary funds for fiscal years 2006 and 2005:
Fund
Water and Sewer Utility
Gas Utility
Solid Waste Utility
Stormwater Utility
Otherfunds
Totals
Unrestricted Net Assets
2006
$ 25,732,341
15,654,956
13,352,948
8,755,451
2005
$ 22,960,294
13,042,534
13,250,067
9,010,115
Change in Net Assets
2006 2005
$ 2,976,775 $ 2,806,121
5,244,542 2,832,714
222,129 440,111
5,189,438 5,075,776
12,584,892 11,628,257 2,507,863 295,942
$ 76,080,588 $ 69,891,267 $ 16,140,747 $ 11,450,664
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General Fund Budgetary Highlights
The final amended budget for General Fund expenditures reflected an increase of $0.6 million, or 0.6%, over the
original budget. Key elements of this increase were as follows:
• $397,000 increase in Parks and Recreation budgeted expenditures - includes an increase of $123,000 for
increased utility costs at recreation facilities; an increase of $105,000 for retirement payouts; $55,000 for new
Office of Aging program; $35,000 for design work on new Morningside recreation facility; and $30,000 for
additional unbudgeted special events.
• $300,000 decrease in Fire Department budget due to transfer of current year operating savings to fire training
programs in the Special Programs special revenue fund.
Final budgeted revenues reflect a $3.6 million, or 3.4%, increase over the original budget due to the following:
• $1,214,000 increase in budgeted electric franchise fees due to increase in base rates for electricity.
• $1,029,000 increase in budgeted licenses, permits and fees due primarily to increase in building permits as a
result of increased development activity.
• $700,000 increase in budgeted other intergovernmental revenues due to: $500,000 increase in revenue
sharing funds from State of Florida primarily due to increased sales tax collections, $100,000 reimbursement
from Florida Department of Transportation for street improvements, and $77,000 federal grant for emergency
management coordinator program.
• $350,000 increase in interest income due to improved market interest rates
• Actual property tax collections in excess of original budget by $304,000, or 0.7%.
Final budgeted "transfers out" reflect a $1.6 million, or 25.1 %, increase over the original budget due to:
• a $1,000,000 transfer to the Emergency Operations program in the Special Programs special revenue fund for
reserves for natural disasters or similar emergency events
• $300,000 of Fire Department operating savings transferred to fire training programs in the Special Programs
special revenue
• $300,000 transferred to the Special Programs special revenue fund for funding of annual contribution to the
PACT performing arts program
Actual revenues for the General Fund exceeded final budgeted revenues by $3.0 million, or 2.7%. Key components of
this surplus included:
• Utility tax revenues exceeded budget by $454,000, or 4.2%, and franchise fees exceeded budget by $429,000,
or 4.8%, primarily due increased electric rates and usage impacting both utility taxes and franchise fees.
• State revenue sharing exceeded budget by $417,000, or 13.0%, due to increases in state collections of Sales
and Use Tax and One Cent Municipal Fuel Tax.
• Interest income exceeded budget by $402,000, or 45.8%, due to improvement in market interest rates.
• Communications services taxes were $307,000, or 4.7%, greater than budget.
• Licenses, permits, and fees were $249,000, or 4.9%, greater than budget due to increased development activity
and related building permit fees.
Actual expenditures for the General Fund were $0.9 million, or 0.9%, less than the final amended budget. This
expenditure budget savings occurred over numerous expenditure categories.
13
C]
Capital Asset and Debt Administration
Capital Assets
Capital assets include land, buildings and building improvements, improvements other than buildings, machinery and
equipment, and infrastructure. Infrastructure assets acquired prior to fiscal 2002 were added when the City retroactively
implemented the infrastructure portion of the new financial reporting model, per GASB 34, during fiscal 2006. The
infrastructure asset category includes long-lived capital assets, typically stationary in nature, such as roads, sidewalks,
and bridges. At September 30, 2006, the City had investments in capital assets totaling $586,044,807 (net of
accumulated depreciation).
City of Clearwater, Florida - Capital Assets`
(amounts in thousands)
Governmental Activities Business-type Activities Total
Prior period
Adjustment Adjusted Adjusted
2006 2005 GASB 34 2005 2006 2005 2006 2005
Land $ 70,590 $ 45,975 $ 26,464 $ 72,439 $ 28,296 $ 26,215 $ 98,886 $ 98,654
Buildings 86,333 87,342 - 87,342 14,533 15,184 100,866 102,526
Improvements other
than buildings 11,498 33,918 (23,556) 10,362 240,603 236,297 252,101 246,659
Machinery and
eauioment 28,307 28,169 - 28,169 4,104 4,101 32,411 32,270
Infrastructure 37,461 3,800 33,364 37,164 - - 37,461 37,164
Construction in
oroaress 9,601 8,658 - 8,658 54,719 35,221 64,320 43,879
Total $ 243,790 $ 207,862 $ 36,272 $ 244,134 $ 342,255 $ 317,018 $ 586,045 $ 561,152
Net of accumulated depreciation
Net capital assets for the City's governmental activities decreased from $244.1 million to $243.8 million, reflecting a
decrease of $0.3 million for the current fiscal year. Depreciation expense of $14.1 million and capital asset retirements
and transfers totaling approximately $7.0 million were offset by approximately $20.7 million of capital asset additions in
the current year. Major fiscal 2006 governmental capital asset transactions included:
• Transfer of $2.1 million of general government land to the Marine and Aviation business-type functions.
• Renovations to the Long Center aquatic and recreation complex capitalized in 2006 totaling $1.0 million.
• Fiscal 2006 construction-in-progress expenditures totaling $1.3 million, $0.9 million, and $0.7 million for the
Beachwalk, Coronado/South Gulfview Streetscapes, and Downtown Streetscapes projects, respectively.
• Completion of the McMullen Booth Road overpass infrastructure including $3.1 million capitalized in fiscal 2006.
Net capital assets for the City's business-type activities increased by $25.3 million from $317.0 million to $342.3 million
during the current fiscal year. Significant fiscal 2006 additions contributing to this increase included:
• Construction expenditures for major Water and Sewer system projects including: $3.7 million for reclaimed
water distribution system additions and improvements; $3.9 million for rehab of bio-solids treatment equipment
at the Northeast and Marshall Street wastewater treatment plants; and $6.6 million for various other Water and
Sewer system capital projects in progress.
• Construction expenditures for new gas mains and service lines totaling $1.4 million for Pinellas County
customers and $1.9 million for Pasco County customers.
• Construction expenditures for major Stormwater system projects including: $6.1 million for Stevenson Creek /
Glen Oaks Park implementation projects; $2.4 million for Myrtle Avenue drainage improvements and $1.0
million of additional expenditures for the Kapok Wetland and Flood Plain Restoration project.
Additional information on the City's capital assets can be found in Note III (C) on pages 53-54 of this report. '
14
C.
11
I?
U
Long-term debt
The City's total long-term debt increased from $273.1 million to $287.6 million, an increase of $14.5 million or 5.3%.
Long-term debt for governmental activities decreased by $5.6 million, or 6.9%; while long-term debt for business-type
activities increased by $20.2 million or 10.5%. Key factors contributing to these changes included:
• The decrease in long-term debt for governmental activities is primarily due to a $6.6 million, or 12.0%, decrease
in net revenue bonds payable due to scheduled bond principal payments.
• The increase in long-term debt for business-type activities is primarily due to $26.4 million of Water and Sewer
Revenue Bonds issued during the current fiscal year, less scheduled bond principal payments.
The City's bonded debt as of September 30, 2006, consists entirely of revenue bonds (secured solely by specified
revenue sources) with no general obligation debt or special assessment debt outstanding. Governmental activities net
revenue bonds totaled $48.3 million while business-type activities totaled $207.5 million.
All revenue bond issues of the City have received an insured rating of either AAA by Standard & Poor's or Fitch, or Aaa
by Moody's.
The City's Charter limits indebtedness to twenty percent of the assessed valuation of non-exempt real estate. The
current debt limitation is approximately $1.6 billion, which is significantly in excess of the City's indebtedness of
approximately $248 million at September 30, 2006.
I Additional information on the City's long-term debt can be found in Note I I I (F) on pages 59-63 of this report.
Economic Factors And Year 2007 Budgets and Rates
Factors considered in preparing the City of Clearwater's budget for fiscal year 2007 included:
' • The unemployment rate for the Tampa Bay metropolitan area for September 2006 was 3.2%, a decrease from
the September 2005 rate of 3.7%. The national rate for September 2006 was 4.6% versus 5.1 % for September
2005.
• Total taxable assessed values for the City of Clearwater increased 23.1 % for fiscal 2007. The City's millage rate
was reduced by 9.5%, from 5.753 to 5.2088 mills for fiscal 2007.
• Employer pension contributions for City employees funded from the operating budget are budgeted to increase
30% over the fiscal 2006 budget, resulting in a $2.8 million cost increase Citywide.
• Property and liability insurance costs are budgeted to increase by more than 100% with approximately two-
thirds, or $4.4 million, impacting the fiscal 2007 budget and the balance funded from Central Insurance Fund
reserves.
• Internal Service costs, representing the labor and operating costs of maintaining the City's growing
infrastructure, fleet, and internal networks, are budgeted to increase by 12%, or $1.3 million, Citywide, with over
half of this increase attributable to escalating fuel costs.
• Budgeted Water and Sewer utility revenues for 2007 reflect a 6% rate increase effective October 1, 2006, while
fiscal 2007 budgeted Stormwater utility revenues reflect a 6% rate increase effective October 1, 2006
Contacting the City's Financial Management
This financial report is designed to provide a general overview of the City's finances for all those with an interest in our
government and to show the City's accountability for the money it receives. Questions concerning any of the information
provided in this report or requests for additional financial information should be addressed to The City of Clearwater,
Finance Department, 100 S. Myrtle Avenue, Clearwater, Florida 33756-5520.
1
15
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This Page Intentionally Left Blank I
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16 1
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A Basic Financial Statements
1
17
City of Clearwater, Florida
Statement of Net Assets
September 30, 2006
Primary Government
ASSETS
Cash and cash equivalents
Restricted cash and cash equivalents
Investments
Total receivables (net)
Internal balances
Due from other governments
Prepaid items
Inventories
Deferred charges
Net pension asset
Restricted assets:
Cash and cash equivalents
Capital assets:
Land
Buildings
Improvements other than buildings
Machinery and equipment
Infrastructure
Construction in progress
Total assets
LIABILITIES
Accounts payable and other current liabilities
Accrued liabilities
Accrued interest payable
Due to other governments
Deposits
Unearned revenue and liens
Payable from restricted assets:
Construction contracts payable
Accrued interest payable
Customers deposits
Non-current liabilities due within one year:
Compensated absences
Loans and leases payable
Revenue bonds payable
Claims payable
Long-term debt and liabilities:
Compensated absences
Loans and leases payable
Revenue bonds payable
Claims payable
Total liabilities
NET ASSETS
Invested in capital assets, net of related debt
Restricted for:
Capital projects
Debt service
Renewal and replacement
Other purposes
Unrestricted
Total net assets
Governmental Business-type
Activities Activities Total
$ 128,197,079 $ 62,915,855 $ 191,112,934
- 16,214,972 16,214,972
1,237,962 - 1,237,962
13,572,744 10,043,572 23,616,316
(523,169) 523,169 -
5,301,372 1,853,808 7,155,180
1,459,368 31,730 1,491,098
286,746 1,233,592 1,520,338
323,230 1,901,744 2,224,974
14,433,663 4,383,910 18,817,573
- 54,701,629 54,701,629
70,590,260 28,296,493 98,886,753
86,332,353 14,532,582 100, 864, 935
11,498,353 240,602,545 252,100,898
28,307,350 4,104,055 32,411,405
37,460,307 - 37,460,307
9,601,310 54,719,199 64,320,509
408,078,928 496,058,855 904,137,783
1,820,150 3,539,895 5,360,045
2,541,777 731,221 3,272,998
555,611 177,163 732,774
595,884 4,804 600,688
2,400 232,404 234,804
1,537,584 9,931 1,547,515
- 2,131,341 2,131,341
- 1,947,737 1,947,737
- 5,232,560 5,232,560
682,163 171,116 853,279
3,810,394 688,658 4,499,052
6,685,000 9,120,000 15,805,000
2,399,200 - 2,399,200
6,456,418 1,619,550 8,075,968
7,236,561 1,217,566 8,454,127
41,582,644 198,376,546 239,959,190
7,200,800 376,776 7,577,576
83,106,586 225,577,268 308,683,854
184,798,564 156,727,363 341,525,927
14,761,351 -
6,721,238 20,360,340
- 4,090,637
19,721,486 10,603,157
98,969,703 78,700,090
$ 324,972,342 $ 270,481,587
14,761,351
27,081,578
4,090,637
30,324,643
177,669,793
$ 595,453,929
The notes to the financial statements are an integral part of this statement.
18
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ASSETS
Cash on hand and in banks
Equity in pooled cash and investments
Receivables (net where applicable, of allowances
for estimated uncollectible amounts):
Accounts and contracts
Mortgages, notes and other loans
Rehabilitation advances
Property taxes
Other
Due from other governmental entities
Investments
Land held for resale
Inventories, at cost
Advances to other funds
Total assets
LIABILITIES
Accounts and contracts payable
Accrued payroll
Due to other funds
Due to other governmental entities
Deposits
Construction escrows
Deferred revenue
Advances from other funds
Total liabilities
FUND BALANCES
Reserved for:
Encumbrances
Debt service requirements
Advances and notes
Grant programs
Land held for resale
Unreserved, reported in:
General fund
Special revenue funds
Debt service funds
Capital projects funds
Total fund balances
Total liabilities and fund balances
City of Clearwater, Florida
Balance Sheet
Governmental Funds
September 30, 2006
Special Capital Other Totals
General Development Improvement Governmental Governmental
Fund Fund Fund Funds Funds
$ 21,575 $ - $ - $ 100 $ 21,675
21,191,983 13,388,568 41,471,800 16,560,626 92,612,977
173,805 - - - 173,805
- - - 11,243,777 11,243,777
- - - 25,031 25,031
213,273 15,307 - - 228,580
1,739,197 - - 71,748 1,810,945
2,157,157 1,916,181 1,023,576 204,458 5,301,372
- - - 1,237,962 1,237,962
- - - 1,998,751 1,998,751
11,415 - - - 11,415
2,000,000 - - 350,000 2,350,000
$ 27,508,405 $ 15,320,056 $ 42,495,376 $ 31,692,453 $ 117,016,290
1
$ 400,942 $ - $ 665,515 $ 117,619 $ 1,184,076
2,244,164 - - 28,559 2,272,723
- - - 120,401 120,401
3,781 543,398 - 48,705 595,884
2,400 - - - 2,400
- - - 291,847 291,847
437,644 15,307 - 63,744 516,695
- - 4,480,983 350,000 4,830,983
3,088,931 558,705 5,146,498 1,020,875 9,815,009
940,667 - 9,603,044 - 10,543,711
- - - 6,721,238 6,721,238
2,000,000 - - 11,593,777 13,593,777
- - - 5,447,192 5,447,192
- - - 1,998,751 1,998,751
21,478,807 - - - 21,478,807 ,
- 14,761,351 - 4,846,665 19,608,016
- - - 63,955 63,955
- - 27,745,834 - 27,745,834
24,419,474 14,761,351 37,348,878 30,671,578 107,201,281
$ 27,508,405 $ 15,320,056 $ 42,495,376 $ 31,692,453 $ 117,016,290
1
The notes to the financial statements are an integral part of this statement.
1
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20
City of Clearwater, Florida
Reconciliation of the Balance Sheet of Governmental Funds
to the Statement of Net Assets
September 30, 2006
Total fund balances of governmental funds
Capital assets used in governmental activities are not financial resources, therefore,
are not reported in the funds. The cost of the assets totaled $385,418,001, and the
accumulated depreciation is $141,628.068.
Total capital assets for governmental activities $ 243,789,933
Less: Land included in governmental funds as "Land Held for Resale" (1,998,751)
The net pension asset related to governmental activities does not represent financial
resources and is not reported in the funds.
Accrued general long-term debt interest expenses are not financial uses and, therefore,
are not reported in the funds.
The assets and liabilities of the internal service funds (funds used to charge the costs of certain activities
to individual funds) are included in the governmental activities in the statement of net assets.
Net assets of internal service funds 41,440,704
Less: Capital assets included in total governmental capital assets above (19,382,178)
Less: Net pension asset included in total governmental net pension asset above (1,498,352)
Add: Capital lease purchases payable included in total governmental below 9,526,698
Add: Compensated absences included in total governmental below 674,034
Less: Adjustment to reflect the consolidation of internal service fund activities
related to enterprise funds (2,619,502)
Long-term liabilities, including bonds payable, are not due and payable in the current
period and accordingly are not reported in the funds.
Long-term liabilities at year-end consist of:
Bonds payable (48,085,000)
' Less: Deferred charge on refunding (to be amortized as interest expense) 308,137
Less: Deferred charge for issuance costs (to be amortized over life of debt) 323,230
Less: Issuance discount (to be amortized as interest expense) 35,511
Add: Issuance premium (to be amortized as a reduction of interest expense) (526,292)
Capital lease purchases payable (11,046,955)
Compensated absences (7,138,581)
Total net assets of governmental activities
C,'
21
$ 107,201,281
241,791,182
14,433,663
(465,238)
28,141,404
(66,129,950)
$324,972
,342
City of Clearwater, Florida
Statement of Revenues, Expenditu res, and Changes in Fund Balances
Governmental Funds
For the Year Ended September 30, 2006
Special Capital Other Total
General Development Improvement Governmental Governmental
Fund Fund Fund Funds Funds
REVENUES
Taxes:
Property taxes $ 45,191,320 $ 2,884,730 $ - $ - $ 48,076,050
Franchise fees 9,434,717 _ _ _ 9,434,717
Utility taxes 11,263,964 - - 11,263,964
Licenses, permits, and fees 5,292,886 1,515,957 - - 6,808,843
Intergovernmental:
Sales tax 6,450,358 10,704,390 - - 17,154,748
Communications services tax 6,853,764 - - - 6,853,764
Other intergovernmental 11,206,957 986,820 1,639,522 6,306,213 20,139,512
Charges for services 12,741,017 - - 1,928,151 14,669,168
Fines and forfeitures 1,000,420 - - 557,075 1,557,495
Interest income 1,281,453 1,639,869 - 863,285 3,784,607
Miscellaneous 1,163,373 - 261,066 468,820 1,893,259
Total revenues 111,880,229 17,731,766 1,900,588 10,123,544 141,636,127
EXPENDITURES
Current:
General government 12,013,403 - 393,588 183,276 12,590,267
Public safety 55,956,287 - 27,381 1,281,380 57,265,048
Physical environment 2,465,849 - 26,330 543,239 3,035,418
Transportation 7,368,152 - 2,898,763 - 10,266,915
Economic environment 1,575,483 - 4,112 1,743,987 3,323,582
Human services 319,049 - - 122,599 441,648
Culture and recreation 25,253,365 - 1,281,084 2,009,578 28,544,027
Debt service:
Principal - - - 7,256,493 7,256,493 '
Interest & fiscal charges - - 3,029,237 3,029,237
Capital outlay - - 9,599,719 234,147 9,833,866
Total expenditures 104,951,588 - 14,230,977 16,403,936 135,586,501
Excess (deficiency) of revenues
over / (under) expenditures 6,928,641 17,731,766 (12,330,389) (6,280,392) 6,049,626
OTHER FINANCING SOURCES (USES) ,
Transfers in 6,539,987 1,254,978 19,108,400 8,354,227 35,257,592
Transfers out (7,688,098) (17,935,844) (1,682,016) (2,544,135) (29,850,093)
Sale of capital assets - - - 119,503 119,503
Land donation from general government - for resale - - 1,000,410 1,000,410
Long term debt issued - - 895,421 - 895,421
Total other financing sources (uses) (1,148,111) (16,680,866) 18,321,805 6,930,005 7,422,833
Net change in fund balances 5,780,530 1,050,900 5,991,416 649,613 13,472,459
Fund balances - beginning 18,638,944 13,710,451 31,357,462 30,021,965 93,728,822
Fund balances - ending $ 24,419,474 $ 14,761,351 $ 37,348,878 $ 30,671,578 $ 107,201,281
The notes to the financial statements are an integral part of this statement.
22
City of Clearwater, Florida
Reconciliation of the Statement of Revenues, Expenditures, and
Changes in Fund Balances of Governmental Funds
to the Statement of Activities
For the Year Ended September 30, 2006
Net change in fund balances - total governmental funds $ 13,472,459
Amounts reported for governmental activities in the Statement of Activities are different because:
Governmental funds report capital outlays as expenditures while governmental activities report
depreciation expense to allocate those costs over the life of the assets. This is the amount by
which capital outlays exceeded depreciation in the current period.
Expenditures for capital assets $ 14,570,693
Less current year depreciation (9,272,399) 5,298,294
In the Statement of Activities the loss on disposition of capital assets is reported. The loss is not
a use of current resources and thus is not reported in the funds. (7,918,635)
Loan proceeds provide current financial resources to governmental funds; however issuing debt
increases long-term liabilities in the Statement of Net Assets. In the current year these amounts are:
Capital lease proceeds
(895,421)
Repayment of long term debt principal is an expenditure in the governmental funds, however the
repayment reduces long-term liabilities in the Statement of Net Assets. Current year amounts are:
Revenue bond principal payments 6,491,170
Capital lease principal payments 765,323 7,256,493
Net pension asset is not a current financial resource and consequently is not reported in the
funds. However it is an asset in the Statement of Net Assets.
Current year change in the net pension asset (2,802,297)
Some expenses reported in the Statement of Activities do not require the use of current financial
resources and therefore are not reported as expenditures in the governmental funds.
Current year change in compensated absences (314,780)
Amortization of deferred charge on refunding (25,386)
Amortization of issuance costs (66,225)
Amortization of bond discounts and premiums
Current year change in accrued interest expense 121,835
97,163 (187,393)
Special assessment revenues are deferred until collected in the governmental funds. The
revenues collected in the current year were prior year revenues in the Statement of Activities. (9,708)
' The net revenues of internal service funds (funds used to charge the costs of certain activities
to individual funds) for governmental activities are reported in the Statement of Activities but not
in the governmental funds. 3,574,951
' Total change in net assets of governmental activities $ 17,788,743
The notes to the financial statements are an integral part of this statement.
23
City of Clearwater, Florida
Statement of Revenues, Expenditures, and Changes in Fund Balances -
Budget and Actual (Non-GAAP Budgetary Basis)
General Fund
For the Year Ended September 30, 2006
REVENUES
Taxes:
Property taxes
Franchise fees
Utility taxes
Licenses, permits, and fees
Intergovernmental:
Sales tax
Communications services tax
Other intergovernmental
Charges for services
Fines and forfeitures
Interest income
Miscellaneous
Total revenues
EXPENDITURES
Current:
General government
City Council
City Manager's Office
City Attorney's Office
Official Records & Legislative Services
Public Communications
Finance
Human Resources
Non-Departmental
Public Works Administration
Planning
City Auditors Office
Office of Management & Budget
Total general government
Public safety
Police
Fire
Development & Neighborhood Services
Total public safety
Physical environment
Public Works Administration
Total physical environment
Transportation
Public Works Administration
Total transportation
Economic environment
Economic Development
Development & Neighborhood Services
Total economic environment
Human services
Equity Services
Total human services
Culture and recreation
Parks and Recreation
Library
Marine & Aviation
Total culture and recreation
Total expenditures (budgetary basis)
Excess of revenues over expenditures (budgetary basis)
OTHER FINANCING SOURCES (USES)
Transfers in
Transfers out
Total other financing sources (uses) (budgetary basis)
Excess (deficiency) of revenues and other financing sources
over expenditures and other financing uses (budgetary basis)
Encumbered purchase orders, beginning of year
Encumbered purchase orders, end of year
Excess (deficiency) of revenues and other financing sources
over expenditures and other financing uses (GAAP basis)
Fund balances - beginning
Fund balances - ending
Budgeted Amounts
Original Final
Variance with
Final Budget
Actual Positive
Amounts (Negative)
L_1
44,878,180 $ 45,182,410 $ 45,191,320 $ 8,910
7,792,130 9,006,130 9,434,717 428,587
10,810,200 10,810,200 11,263,964 453,764
4,015,000 5,043,800 5,292,886 249,086
6,325,000 6,325,000 6,450,358 125,358
6,547,070 6,547,070 6,853,764 306,694
10,010,270 10,726,270 11,206,957 480,687
12,417,960 12,661,790 12,741,017 79,227
828,000 842,000 1,000,420 158,420
529,000 879,000 1,281,453 402,453
1,146,540 905,280 1,163,373 258,093
105,299,350 108,928,950 111,880,229 2,951,279
294,300 296,540 268,424 28,116
1,025,050 1,052,050 1,053,392 (1,342)
1,505,800 1,580,800 1,532,438 48,362
1,228,990 1,226,490 1,098,237 128,253
973,850 986,642 933,453 53,189
2,107,900 2,107,900 2,045,915 61,985
1,207,690 1,277,990 1,241,269 36,721
1,997,870 2,002,870 1,990,446 12,424
90,308 90,355 91,491 (1,136)
1,484,330 1,484,330 1,269,476 214,854
145,960 148,460 147,552 908
315,680 315,680 304,649 11,031
12,377,728 12,570,107 11,976,742 593,365
32,815,580 32,915,580 32,849,133 66,447
19,769,360 19,410,660 19,305,910 104,750
3,471,644 3,665,422 3,602,545 62,877
56,056,584 55,991,662 55,757,588 234,074
2,438,294 2,439,555 2,470,240 (30,685)
2,438,294
2,439,555
2,470,240
(30,685) ,
7,285,818 7,289,587 7,381,275 (91,688)
7,285,818 7,289,587 7,381,275 (91,688)
1,397,330 1,417,330 1,347,427 69,903
251,566 265,608 261,052 4,556
1,648,896 1,682,938 1,608,479 74,459
348,330 348,330 325,549 22,781
348,330 348,330 325,549 22,781
18,956,420
5,510,460 19,353,910
5,591,668 19,328,404
5,480,822 25,506
110,846 '
487,830 477,330 498,841 (21,511)
24,954,710 25,422,908 25,308,067 114,841
105,110,360 105,745,087 104,827,940 917,147
188,990 3,183,863 7,052,289 3,868,426 .
6,100,560 6,144,822 6,539,987 395,165
(6,289,550) (7,870,952) (7,688,098) 182,854
(188,990) (1,726,130) (1,148,111) 578,019
1,457,733 5,904,178 4,446,445
- (1,064,315) (1,064,315)
940,667 940,667
- 1,457,733 5,780,530 4,322,797
18,638,944 18,638,944 18,638,944 -
$ 18,638,944 $ 20,096,677 $ 24,419,474 $ 4,322,797
The notes to the financial statements are an integral part of this statement.
24
City of Clearwater, Florida
Statement of Revenues, Expenditures, and Changes in Fund Balances -
Budget and Actual (GAAP Basis)
Special Development Fund
For the Year Ended September 30, 2006
REVENUES
Taxes
Licenses, permits, and fees
Intergovernmental
Sales tax
Other intergovernmental
Interest income
Total revenues
EXPENDITURES
Total expenditures
Excess of revenues over expenditures
OTHER FINANCING SOURCES (USES)
Transfers in
Transfers out
Total other financing sources (uses)
Deficiency of revenues and other sources
over expenditures and other uses
Fund balances - beginning
Fund balances - ending
Budgeted Amounts
Actual
Original Final Amounts
Variance with
Final Budget
Positive
(Negative)
$ 2,864,740 $ 2,877,615 $ 2,884,730 $ 7,115
623,540 1,449,400 1,515,957 66,557
10,406,000 10,406,000 10,704,390 298,390
1,049,980 1,099,980 986,820 (113,160)
250,000 689,000 1,639,869 950,869
15,194,260 16,521,995 17,731,766 1,209,771
15,194,260 16,521,995 17,731,766 1,209,771
2,754,978 1,254,978 (1,500,000)
(19,797,220) (18,757,176) (17,935,844) 821,332
(19,797,220) (16,002,198) (16,680,866) (678,668)
(4,602,960) 519,797 1,050,900 531,103
13,710,451 13,710,451 13,710,451 -
$ 9,107,491 $ 14,230,248 $ 14,761,351 $ 531,103
The notes to the financial statements are an integral part of this statement.
25
ASSETS
Current assets:
Cash on hand and in banks
Equity in pooled cash and investments
Accounts and contracts receivable:
Billed
Unbilled charges estimated
Less: Allowance for uncollectable accounts
Total receivables, net
Other receivables
Due from other funds
Due from other governmental entities
Inventories, at cost
Prepaid expenses and other assets
Total current assets - unrestricted
Current assets - restricted:
Restricted equity in pooled cash and investments
Total current assets - restricted
Total current assets
City of Clearwater, Florida
Statement of Net Assets
Proprietary Funds
September 30, 2006
Business-type
Enterprise
Water
and Sewer Gas Solid Waste
Utility Utility Utility
$ 400 $ 550 $ 200
19,842,001 13,436,306 9,355,725
Noncurrent assets:
Restricted:
Equity in pooled cash and investments
Deferred charges
Advances to other funds
Net pension asset
Capital assets:
Land and other nondepreciable assets
Capital assets, net of accumulated depreciation
Total noncurrent assets
Total assets
2,426,668 1,168,379 876,300
1,710,900 1,526,300 655,286
4,137,568 2,694,679 1,531,586
(64,292)
(40,908)
(21,935) '
4,073,276 2,653,771 1,509,651
1,020,855 - _
584,118 600,550 -
6,389 - -
25,527,039 16,691,177 10,865,576
10
732
977
,
, 2,186,522 954,530
10,732,977 2,186,522 954,530
36,260,016 18,877,699 11,820,106
37,724,358 300,000 -
1,074,617 363,193 -
- - 2,480,983
1,723,648 919,552 975,373
35,403,231 327,285 1,041,913
176,482,684 39,337,506 2,476,002
252,408,538 41,247,536 6,974,271
288,668,554 60,125,235 18,794,377
1
The notes to the financial statements are an integral part of this statement.
26
Activities
Funds
Stormwater Other
utility Funds Total
Governmental
Activities -
Internal Service
Funds
- $ 518,414 $ 519,564 $ 1,900
7,613,628 12,148,631 62,396,291 35,560,527
603,277 110,926 5,185,550 -
951,100 159,914 5,003,500 -
1,554,377 270,840 10,189,050 -
(16,459) (1,909) (145,503) -
1,537,918 268,931 10,043,547 -
- 25 25 90,606
- - - 294,529
780,766 52,187 1,853,808 -
- 48,924 1,233,592 275,331
- 25,341 31,730 1,459,368
9,932,312 13,062,453 76,078,557 37,682,261
2,340,943 - 16,214,972 -
2,340,943 - 16,214,972 -
12,273,255 13,062,453 92,293,529 $
37,682,261
9,177,271 7,500,000 54,701,629 -
463,934 - 1,901,744 -
- - 2,480,983 5,319,724
319,792 445,545 4,383,910 1,498,352
42,352,665 3,890,598 83,015,692 1,204,403
26,942,571 14,000,419 259,239,182 18,177,775
79,256,233 25,836,562 405,723,140 26,200,254
91,529,488 38,899,015 498,016,669 63,882,515
(Continued)
27
City of Clearwater, Florida
Statement of Net Assets
Proprietary Funds
September 30, 2006
LIABILITIES
Current liabilities:
Accounts and contracts payable
Accrued payroll
Accrued interest payable
Due to other funds
Due to other governmental entities
Deposits
Unearned revenue and liens
Current portion of long-term liabilities:
Compensated absences
Revenue bonds
Notes, loan pool agreement and acquisition contracts
Claims payable
Total current liabilities (payable from current assets)
Current liabilities (payable from restricted assets):
Construction contracts payable
Accrued interest payable
Current portion of long-term liabilities, revenue bonds
Customer deposits
Total current liabilities payable from restricted assets
Total current liabilities
Noncurrent liabilities:
Compensated absences
Revenue bonds (net of unamortized discounts and
deferred amount on refunding)
Notes, loan pool agreement and acquisition contracts
Advances from other funds
Claims payable
Total non-current liabilities
Total liabilities
Net assets:
Invested in capital assets, net of related debt
Restricted for:
Revenue bond debt service and sinking fund requirements
Revenue bond renewal and replacement requirements
Water and sewer impact fees
Stormwater system fees
Parking improvements
Unrestricted
Total net assets
Business-type
Enterprise
Water
and Sewer Gas Solid Waste
utility utility Utility
644,854 1,274,261 388,915
269,526 151,507 152,238
76,260 68,090 32,813
- - 82,474
4,804 - -
49,968 44,141 37,748
1,185,833 948,750 -
197,677 - 125,025
2,428,922 2,486,749 819,213
1,478,011 - -
1,066,168 96,873 -
5,929,167 71,250 -
2,259,631 2,018,399 954,530
10,732,977 2,186,522 954,530
13,161,899 4,673,271 1,773,743
472,933 417,774 357,270
131,637,594 23,938,608 -
373,005 - 369,953
- - 494,842
132,483,532 24,356,382 1,222,065
145,645,431 29,029,653 2,995,808
89,515,999 15,069,376 2,445,621
16,913,495 71,250 -
3,790,637 300,000 -
7,070,651 - -
25,732,341 15, 654, 956 13, 352, 948
$ 143,023,123 $ 31,095,582 $ 15,798,569
Adjustment to reflect the consolidation of internal service fund activities related to enterprise funds
Net assets of business-type activities
The notes to the financial statements are an integral part of this statement.
28
Activities
Funds
Stormwater Other
utility Funds
Total
Governmental
Activities -
Internal Service
Funds
844,150 387,715 3,539,895 344,227
64,421 93,529 731,221 269,054
- - 177,163 90,373
- - 82,474 91,654
- - 4,804 -
- 232,404 232,404 -
- 9,931 9,931 1,020,889
20,192 19,067 171,116 64,411
82,083 - 2,216,666 -
141,070 224,886 688,658 3,324,564
- - - 2,408,000
1,151,916 967,532 7,854,332 7,613,172
653,330 - 2,131,341 -
784,696 - 1,947,737 -
902,917 - 6,903,334 -
- - 5,232,560 -
2,340,943 - 16,214,972 -
3,492,859 967,532 24,069,304 7,613,172
191,114 180,459 1,619,550 609,623
42,800,344 - 198,376,546 -
163,432 311,176 1,217,566 6,202,134
- 4,000,000 4,494,842 824,882
376,776 - 376,776 7,192,000
43,531,666 4,491,635 206,085,280 14,828,639
47,024,525 5,459,167 230,154,584 22,441,811
32,341,411 17,354,956 156,727,363 9,855,480
3,375,595 - 20,360,340 -
- - 4,090,637 -
- - 7,070,651 -
32,506 - 32,506 -
- 3,500,000 3,500,000 -
8,755,451 12,584,892 76,080,588 31,585,224
$ 44,504,963 $ 33,439,848 267,862,085 $ 41,440,704
2,619,502
$ 270,481,587
29
City of Clearwater, Florida
Statement of Revenues, Expenses, and Changes in Fund Net Assets
Proprietary Funds
For the Year Ended September 30, 2006
Business-type
Enterprise
Operating revenues:
Sales to customers
Service charges to customers
User charges to customers
Billings to departments
Rentals
Total operating revenues
Operating expenses:
Personal services
Purchases for resale
Operating materials and supplies
Transportation
Utility service
Dumping charges
Depreciation
Interfund administrative charges
Other current charges:
Professional fees
Advertising
Communications
Printing and binding
Insurance
Repairs and maintenance
Rentals
Miscellaneous
Data processing charges
Taxes
Provision for estimated uncollectable accounts
Total other current charges
Total operating expenses
Operating income (loss)
Water
and Sewer Gas Solid Waste
Utility Utility utility
$ 48,534,888 $ 40,981,509 $ 16,547,049
485,884 1,903,774 75,024
49,020,772 42,885,283 16,622,073
9,045,931 5,208,729 5,747,662
8,827,121 22,022,377 -
2,905,212 141,803 314,958
1,071,788 609,127 3,050,478
2,644,009 102,856 82,843
- - 5,065,618
6,593,069 1,570,743 261,080
5,488,080 1,969,900 1,105,110
2,101,178 154,111 26,092
- 628,148 5,094
171,138 142,251 69,158
- 547 -
319,650 136,120 164,170
3,157,668 186,234 127,959
- 53,708 2,714
346,467 130,600 34,083
442,470 327,520 120,540
- 2,321,270 -
25,438 19,061 1,134
6,564,009 4,099,570 550,944
43,139,219 35,725,105 16,178,693
5,881,553 7,160,178 443,380
The notes to the financial statements are an integral part of this statement.
30
Activities
Funds Governmental
Activities -
Stormwater Other Internal Service
Utility Funds Total Funds
$ 11,075,200 $ 3,905,742 $ 121,044,388 $
48,270 6,835 2,519,787 -
- 6,422,682 6,422,682 -
- - - 41,867,129
- 3,366,161 3,366,161 -
11,123,470 13,701,420 133,353,018 41,867,129
2,368,386 3,262,690 25,633,398 9,333,603
- 3,257,772 34,107,270 3,407,842
173,347 498,691 4,034,011 433,813
821,021 400,895 5,953,309 292,211
- 407,300 3,237,008 619,144
- - 5,065,618 -
1,291,017 1,451,697 11,167,606 4,805,832
1,697,010 1,501,340 11,761,440 431,550
284,700 2,145,962 4,712,043 557,625
- 54,456 687,698 -
23,051 76,748 482,346 1,382,713
- 10,489 11,036 19,508
51,540 168,559 840,039 15,457,183
405,149 215,097 4,092,107 1,533,364
- 177,657 234,079 615,978
58,607 97,090 666,847 622,848
128,890 142,085 1,161,505 419,170
- 28,852 2,350,122 6,364
8,218 1,419 55,270 -
960,155 3,118,414 15,293,092 20,614,753
7,310,936 13,898,799 116,252,752 39,938,748
3,812,534 (197,379) 17,100,266 1,928,381
(Continued)
31
City of Clearwater, Florida
Statement of Revenues, Expenses, and Changes in Fund Net Assets
Proprietary Funds
For the Year Ended September 30, 2006
Business-type
Enterprise
Nonoperating revenues (expenses):
Earnings on investments
Interest expense
Amortization of bond issue costs
Gain (loss) on exchange of assets
Other
Total nonoperating revenue (expenses)
Income before contributions and transfers
Capital grants and contributions
Transfers in
Transfers out
Changes in net assets
Total net assets - beginning
Total net assets - ending
Water
and Sewer Gas Solid Waste
Utility Utility utility
2,037,981 611,995 509,946
(5,686,560) (1,358,902) (76,072)
(64,666) (31,818) -
- - 38,068
137,937 274,773 193,539
(3,575,308) (503,952) 665,481
2,306,245 6,656,226 1,108,861
3,105,647 - -
- 10,248
(2,435,117) (1,411,684) (896,980)
670,530 (1,411,684) (886,732)
2,976,775 5,244,542 222,129
140,046,348 25,851,040 15,576,440
$ 143,023,123 $ 31,095,582 $ 15,798,569
Adjustment to reflect the consolidation of internal service fund activities related to enterprise funds
Change in net assets of business-type activities (page 19)
The notes to the financial statements are an integral part of this statement.
32
Activities
Funds Governmental
Activities -
Stormwater Other Internal Service
utility Funds Total Funds
450,750 730,837 4,341,509 1,615,891
(1,707,727) (186,549) (9,015,810) (340,665)
(33,260) (360) (130,104) -
- (3,783) 34,285 576,011
14,453 209,154 829,856 279,696
(1,275,784) 749,299 (3,940,264) 2,130,933
2,536,750 551,920 13,160,002 4,059,314
3,205,098 2,409,021 8,719,766 39,435
- 325,251 335,499 464,203
(552,410) (778,329) (6,074,520) (132,681)
2,652,688 1,955,943 2,980,745 370,957
5,189,438 2,507,863 16,140,747 4,430,271
39,315,525 30,931,985 37,010,433
$ 44,504,963 $ 33,439,848 $ 41,440,704
855,320
$ 16,996,067
33
City of Clearwater, Florida
Statement of Cash Flows
Proprietary Funds
For the Year Ended September 30, 2006
CASH FLOWS FROM OPERATING
ACTIVITIES
Cash received from customers
Cash received from other funds
Cash payments to suppliers
Cash payments to employees
Cash payments to other funds
Other revenues
Net cash provided by operating activities
CASH FLOWS FROM NONCAPITAL
FINANCING ACTIVITIES
Transfers from other funds
Transfers to other funds
Grant revenue
Receipt of cash on loans to/from other funds
Payment of cash on loans to/from other funds
Net cash provided (used) by noncapital financing activities
CASH FLOWS FROM CAPITAL AND
RELATED FINANCING ACTIVITIES
Principal payments on debt
Advance refunding payment
Interest paid
Acquisition of capital assets
Sale of capital assets
Proceeds from issuance of debt
Payment of bond issue costs
Capital contributed by:
Other governmental entities
Property owners
Developers
Net cash provided (used) by capital
and related financing activities
CASH FLOWS FROM INVESTING
ACTIVITIES
Interest on investments
Net cash provided by investing activities
Net increase (decrease) in cash and cash equivalents
Cash and cash equivalents at beginning of year
Cash and cash equivalents at end of year
Cash and cash equivalents classified as:
Business-type
Enterprise
Water
and Sewer Gas Solid Waste
Utility Utility utility
$ 48,743,490 $ 43,358,684 $ 16,516,945
(20,321,446) (27,859,751) (5,683,605)
(8,727,305) (5,306,657) (5,486,960)
(8,001,716) (2,112,151) (4,509,456)
137,937 274,773 193,539
11,830,960 8,354,898 1,030,463
- - 10,248
(2,435,117) (1,411,684) (896,980)
1,019,017
- - (82,474)
(2,435,117) (1,411,684) 49,811
(7,240,135) (825,001) (87,488)
(1,657,483) (1,161,890) (64,679)
(19,398,224) (3,049,017) (469,482)
- - 38,068
26,175,978 - 259,115
(423,938) - -
1,335,951 - -
141,417 - -
1,628,280 - -
561,846 (5,035,908) (324,466)
2,037,981 611,995 509,946
2,037,981 611,995 509,946
11,995,670 2,519,301 1,265,754
56,304,066 13,404,077 9,044,701
$ 68,299,736 $ 15,923,378 $ 10,310,455
Cash on hand and in banks $ 400 $ 550 $ 200
Equity in pooled cash and investments 19,842,001 13,436,306 9,355,725
Restricted equity in pooled cash and investments 48,457,335 2,486,522 954,530
Total cash and cash equivalents $ 68,299,736 $ 15,923,378 $ 10,310,455
The notes to the financial statements are an integral part of this statement
34
Activities
Funds Governmental
Activities -
Stormwater Other Internal Service
Utility Funds Total Funds
$ 11,017,941 $ 13,781,453 $ 133,418,513 $
- - 41,867,129
(923,053) (7,160,362) (61,948,217) (26,259,723)
(2,284,916) (3,120,430) (24,926,268) (8,832,858)
(2,727,394) (1,951,837) (19,302,554) (1,804,891)
14,453 149,725 770,427 215,891
5,097,031 1,698,549 28,011,901 5,185,548
- 325,251 335,499 456,201
(552,410) (778,329) (6,074,520) (132,681)
59,429 59,429 -
- - 1,019,017 165,493
- - (82,474) -
(552,410) (393,649) (4,743,049) 489,013
(1,125,419) (381,606) (9,659,649) (3,526,745)
(1,919,536) (186,697) (4,990,285) (303,282)
(12,430,018) (678,048) (36,024,789) (6,083,881)
- - 38,068 625,772
- 104,951 26,540,044 4,552,284
- - (423,938) -
3,419,258 275,848 5,031,057
- - 141,417 -
- - 1,628,280 -
(12,055,715) (865,552) (17,719,795) (4,735,852)
962,483 730,837 4,853,242 1,615,891
962,483 730,837 4,853,242 1,615,891
(6,548,611) 1,170,185 10,402,299 2,554,600
25,680,453 18,996,860 123,430,157 33,007,827
$ 19,131,842 $ 20,167,045 $ 133,832,456 $ 35,562,427
$ $ 518,414 $ 519,564 $ 1,900
7,613,628 12,148,631 62,396,291 35,560,527
11,518,214 7,500,000 70,916,601
$ 19,131,842 $ 20,167,045 $ 133,832,456 $ 35,562,427
(Continued)
35
City of Clearwater, Florida
Statement of Cash Flows
Proprietary Funds
For the Year Ended September 30, 2006
Business-type
Enterprise
Water
and Sewer Gas Solid Waste
Utility
utility utility ,
Reconciliation of operating income (loss) to
net cash provided by operating activities:
Operating income (loss) $ 5,881,553 $ 7,160,178 $ 443,380
Adjustments to reconcile operating income (loss)
to net cash provided by operating activities:
Other revenue from nonoperating section
of income statement
Depreciation
Capitalized labor
Construction in process reclassified as expense
Change in assets and liabilities:
(Increase) decrease in accounts receivable
(Increase) decrease in amount due from other governments
(Increase) decrease in inventory
(Increase) decrease in prepaid expenses
Increase (decrease) in accounts and contracts payable
Increase (decrease) in deposits payable
Increase (decrease) in unearned revenue
(Increase) decrease in net pension asset
Increase (decrease) in accrued payroll
137,937 274,773 193,539
6,593,069 1,570,743 261,080
(189,160) (458,503) -
233,258 -
(825,603) 210,382 (132,375)
462,768 - -
(119,008) (115,559) -
359
(926,331) (861,042) (24,244)
110,991 282,080 28,381
439,671 262,223 270,121
31,456 29,623 (9,419)
5,949,407 1,194,720 587,083
$ 11,830,960 $ 8,354,898 $ 1,030,463
Total adjustments
Net cash provided by operating activities
Noncash investing, capital and financing activities:
Amortization of bond issue costs
Amortization of discount on bond issuance
Amortization of deferred loss on defeasance of debt
Decrease in net pension asset
Capital asset contributions to general government
Capital asset contributions from general government
$ (64,666) $ (31,818) $ -
$ (43,948) $ (29,518) $ -
$ (279,843) $ (139,570) $
$ (439,671) $ (262,223) $ (270,121)
$ $ (4,001) $
The notes to the financial statements are an integral part of this statement.
36
Activities
Funds Governmental
Activities -
Stormwater Other Internal Service
Utility Funds Total Funds
$ 3,812,534 $ (197,379) $ 17,100,266 $ 1,928,381
14,453 149,725 770,427 279,696
1,291,017 1,451,697 11,167,606 4,805,831
- - (647,663)
- - 233,258 -
(97,311) 27,215 (817,692) 47
- 35,322 498,090 -
- 17,265 (217,302) 24,362
136 (6,230) (5,735) (1,384,033)
(7,268) 59,760 (1,759,125) (905,676)
- 16,115 437,567 -
- 2,800 2,800 (63,805)
114,788 126,899 1,213,702 446,516
(31,318) 15,360 35,702 54,229
1,284,497 1,895,928 10,911,635 3,257,167
$ 5,097,031 $ 1,698,549 $ 28,011,901 $ 5,185,548
$ (33,260) $ (360) $ (130,104) $ -
$ (37,301) $ - $ (110,767) $ -
$ (34,964) $ - $ (454,377) $ -
$ (114,788) $ (126,899) $ (1,213,702) $ (446,516)
$ - $ - $ (4,001) $ -
$ - $ 2,080,986 $ 2,080,986 $ -
37
City of Clearwater, Florida
Statement of Fiduciary Net Assets
Fiduciary Funds
September 30, 2006
ASSETS
Cash on hand and in banks
Equity in pooled cash and investments
Managed investment accounts, at fair value:
Cash and cash equivalents
Government bonds
Agency bonds
Domestic corporate bonds
Domestic stocks
Mortgage backed bonds
Domestic equity mutual fund
International equity mutual fund
Fixed income mutual fund
Total managed investment accounts
Securities lending collateral
Receivables:
Interest and dividends receivable
Unsettled investment sales
Securities lending earnings receivable
Accounts receivable
Total receivables
Total assets
LIABILITIES
Accounts payable
Unsettled investment purchases
Obligations under securities lending
Other miscellaneous payables:
Downtown Development Board
Special purpose funds
Other
Total miscellaneous payables
Total liabilities
NET ASSETS
Held in trust for pension benefits and other purposes
Total net assets
The notes to the financial statements are an integral part of this statement.
Pension
Trust Agency
Funds Fund
$ 16,194 $ -
3,439,071 543,547
11,676,729
61,295,289
12,332,317
52,237,959
234,607,229
85,103,810
61,108,737
61,002,944
17,836,484
597,201,498
129,445,306 -
1,961,707 -
38,237,710 -
7,886 -
230,865 -
40,438,168 -
770,540,237 543,547
658,973 -
54,511,722 -
129,445,306 -
321,660
8,134
213,753
543,547
184,616,001 543,547
585,924,236 -
$ 585,924,236 $ -
38
City of Clearwater, Florida
Statement of Changes in Fiduciary Net Assets
Fiduciary Funds
For the Year Ended September 30, 2006
ADDITIONS
Contributions:
Contributions from employer
Contributions from employees
Other contributions
Total contributions
Investment income:
Net appreciation in fair value of investments
Interest
Dividends
Less investment expenses:
Investment management / custodian fees
Net income from investing activities
Securities lending income:
Gross earnings
Rebate paid
Bank fee
Net income from securities lending
Total additions
DEDUCTIONS
Benefits and withdrawal payments:
Benefits
Withdrawal payments
Total benefits and withdrawal payments
Income before administrative expenses
Administrative expenses
Net increase
Net assets held in trust for pension benefits:
Beginning of year
End of year
The notes to the financial statements are an integral part of this statement.
Pension
Trust
Funds
$ 8,814,432
5,953,763
1,890,284
16,658,479
38,611,823
9,493,352
2,645,037
50,750,212
2,904,298
47,845,914
5,292,439
(4,988,885)
(107,606)
195,948
64,700,341
22,593,977
949,286
23,543,263
41,157, 078
301,183
40,855,895
545,068,341
$ 585,924,236
39
City of Clearwater, Florida
Notes to the Basic Financial Statements
For the Year Ended September 30, 2006
Note I - Summary of Significant Accounting Policies
The City of Clearwater, Florida (the City) was incorporated in 1923 per Chapter 9710, Special Laws of Florida, as
amended. The City is a Florida municipal corporation governed by a five member City Council including a mayor-council-
member. The City has an estimated population of 110,000 and is located in the four-county Tampa-St. Petersburg-
Clearwater Metropolitan Statistical Area (MSA), which has an estimated population of 2,588,000.
The financial statements of the City of Clearwater, Florida, reporting entity (City) have been prepared in accordance with
generally accepted accounting principles (GAAP) as applied to governmental units. The Governmental Accounting
Standards Board (GASB) is the standard-setting body for governmental accounting and financial reporting.
Pronouncements of the Financial Accounting Standards Board (FASB) issued after November 30, 1989, are not applied
in the preparation of the financial statements of the enterprise fund types in accordance with GASB Statement Number
20. The GASB periodically updates its codification of the existing Governmental Accounting and Financial Reporting
standards which, along with subsequent GASB pronouncements (Statements and Interpretations), constitutes GAAP for
governmental units. The City's more significant accounting policies are described below.
Effective with fiscal year 2002 the City has implemented "Basic Financial Statements and Management Discussion and
Analysis for State and Local Governments" (GASB Statement #34). As part of this Statement, there are new reporting
requirements for governments' infrastructure (roads, bridges, etc). The requirements permit an optional four-year delay
for retroactive implementation of the infrastructure reporting requirements to fiscal 2006. The City elected to implement
GASB Statement #34 effective with fiscal year 2002, and to defer implementation of the retroactive infrastructure
reporting to the current fiscal year 2006. 1
A. Financial Reporting Entity
In evaluating the City as a reporting entity, management has included in the accompanying financial statements the City
of Clearwater (the primary government) and its component units, entities for which the government is considered to be
financially accountable. The City has adhered to the standards set forth in GASB Statement No. 14 in reporting the
primary government (including blended component units), the reporting entity, and related organizations. ,
Blended Component Unit - Component units that meet the criteria for blended presentation in accordance with GASB
Statement Number 14 are reported in a manner similar to that of the primary government itself. Accordingly, throughout
this report, data presented for the primary government includes data of the following blended component unit. The ,
Clearwater Community Redevelopment Agency (CRA), created by authority of Florida Statute Chapter 163, Part III, and
City of Clearwater Resolution 81-68, although it is legally separate, is reported as if it were part of the City (blended
component unit) due to the City Council serving as the governing board of the CRA. Separate financial statements for the
CRA are not available. However financial statements for the CRA are included in the City's comprehensive annual '
financial report as a governmental special revenue fund.
B. Basic Financial Statements Under the New Financial Reporting Model
The City's Basic Financial Statements contain three components: government-wide financial statements, fund financial
statements, and notes to the financial statements. I
1
City of Clearwater, Florida
Notes to the Basic Financial Statements
For the Year Ended September 30, 2006
1. Government-wide financial statements. The government-wide financial statements report information on all of the
nonfiduciary activities of the primary government and its component unit using the accrual basis of accounting, which is
similar to the accounting used by private-sector businesses. 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 fees and charges for
support.
The statement of net assets presents information on all of the assets and liabilities of the City. The difference between
' assets and liabilities is reported as net assets. Changes in net assets may serve as an indicator of whether the financial
position of the City is improving or deteriorating.
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 with 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. The operating grants include
operating-specific and discretionary (either operating or capital) grants while the capital grants column reflects capital-
specific grants. Taxes and other items not properly included among program revenues are reported instead as general
revenues. All revenues and expenses are reported as soon as the underlying transaction has occurred, regardless of
when cash is received or paid.
As a general rule the effect of interfund activity has been eliminated from the government-wide financial statements.
Exceptions to this general rule are payments-in-lieu of taxes and other quasi-external charges between enterprise funds
and various other functions of the government. Elimination of these charges would distort the direct costs and program
revenues reported for the various functions concerned.
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2. Fund financial statements. 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. The fund
financial statements are, in substance, very similar to the financial statements presented in the previous financial
reporting model. An emphasis is on the major funds in either the governmental or business-type categories. Major
individual governmental funds and major individual enterprise funds are reported as separate columns in the fund
financial statements. Non-major funds (by category) are summarized into a single column.
The City reports the following major governmental funds:
The General Fund is the government'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 Special Development fund is a special revenue fund used to account for impact fees, property taxes for road
improvements, local option gas taxes, infrastructure taxes, and other revenues which are restricted legally or by City
Council policy to be used for specific capital improvement projects.
The Capital Improvement Fund is used to provide combined accounting presentation for all City capital improvement
projects except those financed from proprietary funds or bond proceeds where bond ordinance provisions require the
segregation of bond proceeds in separate funds.
The City reports the following major proprietary funds:
The Water and Sewer Utility enterprise fund is used to account for the financing, construction, operation, and
maintenance of the water and sewer services of the City from charges made to users of the service.
The Gas Utility enterprise fund is used to account for the financing, construction, operation, and maintenance of the gas
service of the City from charges made to the users of the service.
41
City of Clearwater, Florida
Notes to the Basic Financial Statements
For the Year Ended September 30, 2006
The Solid Waste Utility enterprise fund is used to account for the financing, construction, operation, and maintenance of
the solid waste service of the City from charges made to the users of the service.
The Stormwater Utility enterprise fund is used to account for the financing, construction, operation, and maintenance of
the stormwater management system of the City from charges assessed against each developed property.
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 the proprietary
fund's principal ongoing operations. Operating expenses for proprietary funds include the cost of sales and service,
administrative expenses, and depreciation on capital assets. All revenues and expenses not meeting this definition are
reported as nonoperating revenues and expenses.
Additionally, the City reports the following fund types:
Internal service funds account for fleet management, information technology, telephone, graphics, employee relations,
facilities management, radio communications, insurance, and risk management services provided to other City
departments on a cost reimbursement basis. The Garage, Administrative Services, General Services, and Central
Insurance funds primarily benefit governmental funds and are consequently included as governmental activities. Pension
trust funds account for the financial operation and condition of the Employees' Pension Plan, the Firemen's Relief and
Pension Plan, the Police Supplemental Pension Plan, and the Firefighters Supplemental Pension Plan.
The Treasurer's Escrow Agency Fund accounts for the receipt, custody, and expenditure of monies held temporarily in
an agency capacity for other parties.
The pension trust funds and the agency fund are fiduciary funds used to account for resources held for the benefit of
parties outside the government. Fiduciary funds are not included in the government-wide financial statements because
the resources of these funds are not available to support the City's own programs.
C. Measurement Focus, Basis of Accounting, and Financial Statement Presentation
The government-wide financial statements are reported using the economic resources measurement focus and the
accrual basis of accounting, as are the proprietary fund and fiduciary fund financial statements. The agency fund
included within the fiduciary fund financial statements also uses the accrual basis of accounting but does not have a
measurement focus. Revenues are recorded when earned and expenses are recorded when a liability is incurred,
regardless of the timing of related cash flows. Property taxes are recognized as revenues in the year for which they are
levied. Grants and similar items are recognized as revenue as soon as all eligibility requirements imposed by the provider
have been met.
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 to be available when they are collectible within the current period or soon enough thereafter to
pay liabilities of the current period. For this purpose, the City considers property tax revenues to be available if they are
collected within 60 days of the end of the current fiscal year. Other revenues are considered to be available if they are
collected within 90 days of fiscal year-end. Expenditures generally are recorded when a liability is incurred, as under
accrual accounting. However, debt service expenditures, as well as expenditures related to compensated absences and
claims and judgments, are recorded only when payment is due.
Property taxes, franchise taxes, licenses, and interest associated with the current fiscal period are all considered
susceptible to accrual and so have been recognized as revenues of the current fiscal period for the governmental funds.
All other revenue items are considered to be measurable and available only when cash is received by the City.
[l
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42
City of Clearwater, Florida
' Notes to the Basic Financial Statements
For the Year Ended September 30, 2006
' D. Assets, Liabilities, and Net Assets or Equity
1. Deposits, pooled cash, and investments
' Investments with original maturities of three months or less are considered to meet the definition of cash equivalents. The
majority of the investments in which the City's funds have equity are held by the City's consolidated pool of cash and
investments. The City utilizes the consolidated cash pool to account for cash and investments of all City funds other than
those that are required by ordinance to be physically segregated. The consolidated cash pool concept allows each
participating fund to benefit from the economies of scale and improved yield that are inherent to a larger investment pool.
Formal accounting records detail the individual equities of the participating funds. The cash pool utilizes a single checking
account for all City receipts and disbursements.
Since fund equities in this cash management pool have the general characteristics of demand deposits in that additional
funds may be deposited at any time and also funds may be withdrawn at any time without prior notice or penalty, each
fund's equity account is considered a cash equivalent regardless of the maturities of investments held by the pool.
' All individual fund cash equity in a deficit (overdraft) position with respect to the consolidated cash pool is reclassified at
year-end to short-term interfund payables to the Capital Improvement Fund. The Capital Improvement Fund is the fund
selected by management to reflect the offsetting interfund receivables in such cases.
The City has an agreement with its depository bank to provide that all excess cash is swept daily and automatically into
an overnight money market account which pays interest at the federal funds rate which was 5.25% at September 30,
2006, with no requirement for a minimum compensating balance. This account is collateralized through the State of
Florida Public Deposits Program.
Under City Charter and the current Investment Policy, adopted by the City Council on September 7, 1995, consolidated
cash pool investments are limited to the following: United States Government Securities, Certificates of Deposit in Local
Banks, Repurchase Agreements, Savings Accounts in Local Banks, Federal Government Agency Securities, Municipal
Bonds issued by governmental entities within the state of Florida (other than City of Clearwater issues), and State of
Florida Bonds.
The City utilizes a very conservative investment philosophy when it invests its pooled cash funds in that the return of the
principal is more important than the return on the principal. The City does not actively trade its portfolio and generally holds
investments until maturity. Through the use of a laddered approach to maturities and by timing maturities to cash needs, the
City does not anticipate selling investments to meet cash flow requirements.
Under the City's Investment Policy, a performance measurement standard has been established. The performance measure
' chosen is a weighted average of: the overnight interest rate; and three month, six month, one year, three year, five year, and
ten year Treasury rates, respectively. For the fiscal year ended September 30, 2006, the performance measure weighted
average was 4.70%. The actual pooled cash earnings performance before bank charges was 4.15%.
' Investments being held outside of the consolidated cash pool include escrowed debt service investments and employee
retirement investments. Permissible escrowed debt service investments are specifically defined in each individual debt
instrument, but generally follow the same limitations applicable to consolidated cash pool investments. The City
' maintains four different employee retirement programs, and each one has its own list of permitted investments.
Generally, each plan allows the same type of investments as the consolidated cash pool, but additionally allows some
portion of its assets to be invested in corporate bonds, notes of corporations, and stocks that are listed on one or more of
the recognized national or international stock exchanges.
2. Receivables and payables
Activity between funds that are representative of lending/borrowing arrangements outstanding at the end of the fiscal
year are referred to as either "due to/from other funds" (i.e. the current portion of interfund loans) or "advances to/from
' other funds" (i.e. the non-current portion of interfund loans). All other outstanding balances between funds are reported
as "due to/from other funds." Any residual balances outstanding between the governmental activities and business-type
activities are reported in the government-wide financial statements as "internal balances".
1
43
City of Clearwater, Florida
Notes to the Basic Financial Statements r
For the Year Ended September 30, 2006
Advances between funds, as reported in the fund financial statements, are offset by a fund balance reserve account in
applicable governmental funds to indicate that they are not available for appropriation and are not expendable available
financial resources.
All trade and property tax receivables are shown net of an allowance for uncollectibles. Trade accounts receivable less
than 60 days are included in the trade accounts receivable allowance for uncollectibles at the five-year average loss
experience rate of 3.94%. Trade accounts receivable in excess of 60 days are reserved at 40%. The property tax '
receivable allowance for uncollectibles is 10% of the current year portion of the receivable, and 30%, 50%, 70%, 90%,
and 95% for the receivable portions attributable to the prior five years respectively (fiscal 2005 thru 2001), and 100% of
the receivable attributable to fiscal years 2000 and prior. ,
Property tax revenue is recognized in the fiscal year for which the taxes are levied, provided the availability test is met, in
conformance with NCGA Interpretation No. 3. Property taxes for the following fiscal year are levied by Council action in
September of each year. This levy is apportioned to property owners based on the previous January 1 assessed values. '
Tax bills are mailed out on or about November 1, and the collection period runs from November 1 through March 31. On
April 1, unpaid property taxes are considered delinquent and become a lien. Tax certificates are sold in June for real
property with delinquent taxes. '
Since taxes are not collected prior to November 1, the City does not record revenue for advance collections. Uncollected
taxes receivable at year-end are recorded, with an appropriate allowance for estimated uncollectible amounts. The net
amount deemed to be collectible but not current (not expected to be collected within sixty days after the close of the fiscal
year) is shown as deferred revenue in the appropriate fund.
All delinquent property taxes, except those levied specifically for the restricted purposes of financing activities accounted
for in the Special Development Fund, are recorded in the General Fund. Property tax revenues are recognized in the
General Fund and the required transfers to the appropriate debt service or pension fund are recorded as operating '
transfers from the General Fund.
The City is permitted by State law to levy ten mills without referendum. Additional millage not subject to the ten mill
limitation is authorized if approved by referendum. The tax rate of 5.7530 mills for the year ended September 30, 2006,
remains unchanged from the prior year.
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id it '
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.
prepa
ems
Inventories of proprietary funds are stated at cost and valued on the first-in first-out (FIFO) basis. In governmental funds,
the majority of inventory items are accounted for under the purchases method, which provides that expenditures are '
recognized when the inventory item is purchased. The only governmental fund inventory that is accounted for under the
consumption method is the General Fund inventory of items for resale at the City's public fishing pier. Under the
consumption method, the expenditure is recognized when the inventory item is sold (or consumed). '
Certain payments to vendors reflect costs applicable to future accounting periods and are recorded as prepaid items in both
government-wide and fund financial statements.
'
4. Restricted assets
Certain resources of the City's enterprise funds are classified as restricted assets. Restricted assets include: Water and
Sewer improvement charges restricted by the authorizing ordinances to the construction of additions and improvements to '
the water and sewer systems; Gas Utility and Solid Waste Utility restricted customer deposits; and assets of the Water &
Sewer Utility, Gas Utility, Stormwater Utility, and Parking System funds restricted under the provisions of authorizing
ordinances for revenue bonds to the payment of future revenue bond debt service, system construction, and renewals and ,
replacements.
44
City of Clearwater, Florida
Notes to the Basic Financial Statements
For the Year Ended September 30, 2006
1
E
1
5. Capital assets
Capital assets, which include property, plant, equipment, and certain infrastructure assets, (e.g. roads, bridges, etc.) are
reported in the applicable governmental or business-type activities columns in the government-wide financial statements.
The City chose to defer implementation of retroactive infrastructure reporting to the current fiscal year per the
implementation of GASB Statement #34. Capital assets, as defined by the City, are assets with an initial individual cost of
more than $5,000 (amount not rounded) and an estimated useful life in excess of five years. Individual assets that cost
less than $5,000, but that operate as part of a network system, may be capitalized in the aggregate, using the group
method, if the estimated average useful life of the individual asset is five years or more. Additionally, higher thresholds
for capitalization apply to the following categories: land improvements, $50,000; buildings, building improvements, and
utility systems, $100,000; and infrastructure, $500,000. Capital assets are recorded at historical cost or estimated
historical cost if purchased or constructed. Donated capital assets are recorded at estimated fair market value at the
date of donation. The costs of normal maintenance and repairs that do not add to the value of the asset or materially
extend asset lives are not capitalized.
Major outlays for capital assets and improvements are capitalized as projects are constructed. Interest incurred during
the construction phase of capital assets of business-type activities is included as part of the capitalized value of the
assets constructed. The total interest expense incurred by business-type activities during the current fiscal year was
$9,664,432. Of this amount, $298,927, $75,706, and $274,619 were included as part of the cost of capital assets under
construction in connection with water & sewer, gas, and stormwater system projects, respectively. These interest
expense amounts were netted against related project interest earnings of $126,155, $-0-, and $511,733, respectively, to
arrive at net capitalized interest of $172,772, $75,706, and ($237,114) for water & sewer, gas, and stormwater system
projects, respectively.
Property, plant, and equipment of the primary government are depreciated using the straight-line method over the
following estimated useful lives:
Assets Years
Buildings & building improvements 10-40
Public domain infrastructure 20-40
Utility systems 25-40
Machinery & equipment 5-33
Vehicles 5-10
6. Compensated absences
It is the City's policy to permit employees to accumulate earned but unused vacation and sick pay benefits. Generally
employees may accumulate vacation time not exceeding 360 hours and sick leave not exceeding 1,560 hours. Upon
retirement from City service a qualified employee is paid for all vacation time not exceeding 360 hours and one-half of
accumulated unused sick leave not exceeding 1,560 hours (i.e. maximum pay-out of 780 hours). The City accrues for all
earned but unused vacation pay up to the "cap" of 360 hours, and the portion of unused sick leave estimated to be payable
upon retirement. The current portion of compensated absences is the amount estimated to be used in the following year.
For governmental activities, compensated absences are liquidated within the same governmental funds where the employee
vacation and/or sick leave was earned.
7. Long-term obligations
In the government-wide financial statements, and proprietary fund types in the fund financial statements, long-term debt and
other long-term obligations are reported as liabilities in the applicable governmental activities, business-type activities, or
proprietary fund type statement of net assets. Bond premiums and discounts, as well as issuance costs, are deferred and
amortized over the life of the bonds using the straight-line method. Bonds payable are reported net of the applicable bond
premium or discount. Bond issuance costs are reported as deferred charges and amortized over the term of the related
debt.
45
City of Clearwater, Florida
Notes to the Basic Financial Statements ,
For the Year Ended September 30, 2006
?J
In the fund financial statements, governmental fund types recognize bond premiums and discounts, as well as bond
issuance costs, during the current period. The face amount of debt issued is reported as other financing sources. ,
Premiums received on debt issuances are reported as other financing sources while discounts on debt issuances are
reported as other financing uses. Issuance costs, whether or not withheld from the actual debt proceeds received, are
reported as debt service expenditures.
8. Fund equity
In the fund financial statements, governmental funds report reservations of fund balance for amounts that are not available ,
for appropriation or are legally restricted by outside parties for use for a specific purpose. Designations of fund balance
represent tentative management plans that are subject to change.
Note II - Stewardship, Compliance, and Accountability
A. Budgets and budgetary accounting
Annual budgets are legally adopted for the General Fund, Special Development special revenue fund, and the Community
Redevelopment Agency special revenue fund. The budget for the Special Development Fund is adopted on a basis
consistent with GAAP, and appropriations lapse at year-end. Appropriations for open encumbered purchase orders at year-
end in the General Fund do not lapse, but rather continue until liquidated or otherwise cancelled by City Council action. For
the General Fund budgetary comparison statements, actual expenditures have been adjusted to include end-of-year
encumbrances and to exclude beginning-of-year encumbrances, in order to provide a meaningful comparison. Except for
the treatment of encumbrances and certain transactions relating to interfund loans, the General Fund Budget is adopted on
a basis consistent with GAAP, and all non-encumbered appropriations lapse at year-end.
The level of budgetary control established by the legislative body, the level on which expenditures may not legally exceed
appropriations, is the individual fund. In accordance with provisions of Ordinance 5025-90 and with Section 2.519(4) of
the Clearwater Code, the City Manager may transfer part or all of any unencumbered appropriation balance among
programs within an operating fund, provided such action does not result in the discontinuance of a program. Such
transfers must be included in the next budget review presented to the City Council. Upon detailed written request I the
City Manager, the City Council may by ordinance transfer part or all of any unencumbered appropriation balance from
one fund to another.
As established by administrative policy, department directors may transfer money from one operating code to another
within a program without a formal written amendment. Formal requests for budget amendments from department
directors are required for transfers in capital expenditures, transfers, and reserves. Thus, certain object classifications
within departmental and/or program budget appropriations are subject to administratively imposed controls, in addition to
the legal controls imposed by City Council action described above.
The Community Redevelopment Agency (CRA) Fund annual budget is adopted by the trustees of that agency in
accordance with state law. The level of budgetary control is the total fund. Except for the treatment of encumbrances, the
CRA Fund Budget is adopted on a basis consistent with GAAP, and all non-encumbered appropriations lapse at year-end.
Budget amounts presented in the accompanying financial statements reflect all amendments adopted by the City Council
and the governing board of the component unit. All amendments were adopted in conformance with legal requirements.
Individual amendments, as well as the net effects of all amendments during the fiscal year, were not material in relation
to the original appropriations for the governmental funds in the aggregate.
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46
City of Clearwater, Florida
Notes to the Basic Financial Statements
For the Year Ended September 30, 2006
1
1
1
1
1
1
1
1
1
1
1
1
1
1
Budgets for the Capital Projects Funds, the Special Programs Fund, and the Local Housing Assistance Trust Fund are
adopted on a multi-year completed program basis, where budgetary appropriations do not lapse at year-end, but may
extend across two or more fiscal years. A comparison of annual results with these budgets would not be meaningful and is
therefore not included in this report.
All City Council adopted budgets are integrated into the formal accounting system to allow for monthly comparison of
projected and actual results in all funds for which budgets are adopted.
B. Re-statement of prior year balances
The implementation of GASB 34 retroactive infrastructure in the current year, and related adjustments to infrastructure,
land improvements, and land capital asset categories, resulted in the following adjustment to the prior year balances:
Fund/Net Assets Restated
Balance Balance
9/30/2005 Adjustment 9/30/2005
General government capital assets $207,862,112
Governmental activities, net assets $270,911,571
$36,272,028 $244,134,140
$36,272,028 $307,183,599
Note III - Detailed Notes on All Funds
A. Deposits and investments
Investments with original maturities of three months or less are considered to meet the definition of cash equivalents. The
majority of the investments in which the City's proprietary funds have equity are held by the City's consolidated pool of cash
and investments. Since fund equities in this cash management pool have the general characteristics of demand deposits, in
that additional funds may be deposited at any time and also funds may be withdrawn at any time without prior notice or
penalty, each fund's equity account is considered a cash-equivalent regardless of the maturities of investments held by the
pool. Funds with deficit (overdraft) positions within the consolidated pool report the deficits as interfund payables to the
City's Capital Improvement Fund.
Deposits
All cash of the City is entirely insured either by federal depository insurance or via banks' participation as qualified public
depositories pursuant to Florida Statutes, Chapter 280, "Security for Public Deposits". The City is required to verify that
monies are invested in "qualified public depositories" as defined in Florida Statutes section 280.02.
Pooled Cash and Investments
To increase returns and minimize fees, the City follows the practice of pooling available cash and investments of all funds
with the exception of retirement plan investments and assets held under Bond Trust Indenture Agreements. Please refer
to Note (1)(D)(1) for a discussion of allowable investments under the pooled cash and investments investment policy. All
investments at year-end were in compliance with the pooled cash and investments investment policy.
47
City of Clearwater, Florida
Notes to the Basic Financial Statements
For the Year Ended September 30, 2006
At year-end, the government's cash and investment balances were as follows, excluding pension plan investments and
investments held under Bond Trust Indenture Agreements:
Pooled Cash and investments
Cash and cash equivalents:
Cash on hand
Deposits with banks
Total cash and cash equivalents
Investments:
Treasuries
Treasury zeroes
U.S. Agencies
Government National Mortgage Assn (GNMA)
Federal Farm Credit Bank (FFCB)
Federal Home Loan Bank (FHLB)
Federal Home Loan Mortgage Assn (FHLMC)
Federal Home Loan Mortgage Assn Zeroes
Financing Corporation (FICO)
Federal National Mortgage Assn (FNMA)
Federal National Mortgage Assn (FNMA) Zeroes
Dept of Housing and Urban Development (HUD)
Student Loan Marketing Association (SLMA)
Student Loan Marketing Association (SLMA)
Tennessee Valley Authority (TVA)
Tennessee Valley Authority Zeroes
Municipal bonds
Collateralized mortgage obligations
Total investments
Total pooled cash and investments
Carrying % of Weighted avg Moody's
Amount Portfolio maturity (years) tin
$ 543,139 n/a n/a
14,440,538 n/a n/a
14,983,677 5.5% '
4,952,120
463,865 2.0% 0.62 n/a
n/a
646,023 0.2% 2.98
3,619,385 1.3% 0.83
79,897,879 29.6% 2.92
55,792,511
2,981,184 21.7%
F 2.69
698,753 0.3% 1.44
82,460,846
1,231,087 31.1 % 3.71
5,640,332 2.1% 3.42
263,604 2 5% 8.57
6,549,243
1,812,730 2.4% 4.01
4,719,897
1,455,493 0.5% 3.56
2,108,291 0.8% 1.32
255,293,243
$270,276,920 100.0% 3.05
AAA
AAA
AAA
AAA
AAA
AAA
AAA
AAA
AAA
AAA
A
AAA
AAA
AAA
AAA
C
Cash and investments as of September 30, 2006 are classified in the accompanying financial statements as follows:
Statement of net assets
Primary Government:
Cash and cash equivalents
Restricted cash and cash equivalents
Restricted assets - Cash and cash equivalents
Fiduciary Funds:
Equity in pooled cash and investments-pension funds
Equity in pooled cash and investments-agency fund
Total cash and investments per CAFR
Less accrued interest on investments
Add back outstanding checks at 9/30/06
Total pooled cash and investments per above
09/30/06
$ 191,112,934
'
16,214,972
54,701,629 '
3,439,071
543,547
266,012,153
(2,376,197)
6,640,964
$ 270,276,920 '
t
48
City of Clearwater, Florida
Notes to the Basic Financial Statements
For the Year Ended September 30, 2006
t
t
1
r
Interest Rate Risk - Pooled Cash and Investments:
As a means of limiting exposure to fair value losses arising from rising interest rates, the city's pooled cash investment
policy prohibits investments in securities maturing more than fifteen years from the date of purchase, unless matched to
a specific cash flow requirement. Additionally, the policy allows no more than 10% of the portfolio to have maturities in
excess of ten years unless specifically matched against a debt or obligation. Finally, the policy requires that the weighted
average maturity be three years or less, except for temporary situations due to market conditions and/or cash needs
when the average maturity may exceed three years but shall not exceed four years. Weighted average maturities for the
city's pooled cash investments are indicated in the table above.
Credit Risk - Pooled Cash and Investments:
The City's pooled cash investment policy, in accordance with Florida Statutes, allows investments to direct obligations of the
United States, federal agencies, debt issued by the State of Florida or any political subdivision, and commercial paper of
prime quality of the highest letter and numerical rating as provided by at least one nationally recognized rating service.
Ratings for the City's pooled cash investments are disclosed in the preceding table.
Concentration of Credit Risk - Pooled Cash and Investments:
The City's pooled cash investment policy limits the investment in any one issuer to 40% of the portfolio. Concentrations
for several issuers exceeded 5% as disclosed in the preceding table, though none exceeded the 40% limit per the policy.
Bond Trust Indenture Agreement/Debt Service Investments
The City invests in certain prescribed investments per the terms of revenue bond trust indenture agreements. As of
September 30, 2006, these consisted of:
Bond Trust Indenture Debt Service Investments
Cash and cash equivalents:
Money market mutual fund
Total cash and cash equivalents
Investments:
Commercial paper
Total investments
Total pooled cash and investments
Pension Plan Assets
Carrying % of Weighted avg Moody's
Amount Portfolio maturity (years) Rating
$ 372,998 n/a n/a
372,998 30.1%
864,964 69.9% 0.33 AAA
864,964
$ 1,237,962 100.0%
The City reports four pension funds in the accompanying financial statements. Each of the plans has a separate
governing board of trustees, a separate investment policy, and differing investment restrictions/risks. Consequently each
is disclosed separately below. All investments at year-end were in compliance with the respective plan investment
policies. Please refer to Note (D) (1) for a discussion of allowable investments under the pension plans.
49
1?
City of Clearwater, Florida
Notes to the Basic Financial Statements
For the Year Ended September 30, 2006
Employees Pension Plan
At year-end, the Employees' Pension Plan cash and investment balances were as follows:
Cash and ash equivalents-
Equity in pooled cash
Cash in managed investment accounts
Total cash and cash equivalents
Investments:
Treasuries
Treasuries - Strips
Index linked Treasuries
U.S. agencies
Domestic corporate bonds
Domestic corporate bonds
Domestic corporate bonds
Domestic corporate bonds
Domestic corporate bonds
Domestic corporate bonds
Domestic corporate bonds
Domestic stocks
Mortgage backed bonds
Domestic equity mutual fund
International equity fund
Fixed income mutual fund
Total investments
Total managed cash and investments
Carrying % of Weighted avg Moody's
Amount Portfolio maturity (yearsl Rating
$ 1,221,515 0.2% 2.82 See above
10,701,781 1.9% n/a n/a
11,923,296
54,862,139 9.6% 3
73 AAA
386,165 0.1 % . AAA
1,561,000 0.3% 9.49 AAA
6,681,307 1.2% 7.93 AAA
2,374,637 0.4%
8,219,860 1.4%
10,421,828 1.8%
22,907,440 4.0%
3,987,920 0.7%
2,791,069 0.5%
434,037 0.1%
222,410,983 38.8%
84,286,886 14.7%
61,108,737 10.7%
61,002,944 10.6%
17,836,484 3.1%
561,273,436
$ 573,196,732 100.0%
Interest Rate Risk - Employees' Pension Plan:
10.56
n/a
24.66
n/a
n/a
7.02
AAA
Aal /Aa2/Aa3
Al/A2/A3
Baal/Baa2/Baa3
Bat
131
Caal
n/a
AAA
n/a
n/a
AAA
As a means of limiting exposure to fair value losses arising from rising interest rates, the Employees' Pension Plan
investment policy limits the investment in fixed income investments to no more than 50% of the portfolio. There are no
limits related to weighted average maturities due to the long-term nature of pension plan investing.
Credit Risk - Employees' Pension Plan:
The Employees' Pension Plan investment policy limits credit risk by restricting equity investments to corporations that are
listed on one of the national or international stock exchanges. Additionally, fixed income corporate bonds must carry an
"investment grade" rating as established by one of the nationally recognized rating agencies. At September 30, 2006,
the Plan had $434,037 invested in domestic corporate bonds that had fallen below investment grade as the result of
investment downgrades, as indicated on the table above (investment grades Bat, Ba2, and 131). The respective money
managers notified the Plan administrators of the downgrades and the planned courses of action related to these
securities on a timely basis, consistent with the policy individual manager guidelines.
Concentration of Credit Risk - Employees' Pension Plan:
The Employees' Pension Plan investment policy limits concentration of credit risk by limiting the investment in common
stock or capital stock of any one corporation to 3% of the plan equity assets, unless due to a higher percentage included
in a nationally recognized market index at least as broad as the Standard and Poor's Composite Index of 500
companies, or upon a specific finding by the investment committee that such higher percentage is in the best interest of
J
0
1
50
' City of Clearwater Florida
' Notes to the Basic Financial Statements
For the Year Ended September 30, 2006
' the fund. Additionally, the individual manager guidelines associated with the policy provide further diversification of both
equity and fixed income investments to minimize concentration of credit risk
.
Foreign Currency Risk - Employees' Pension Plan:
'
Risk of loss arises from changes in currency exchange rates. The Employees
Pension Plan invest ment policy does not
have a formal policy to limit foreign currency risk, other than a guideline of no more than 10% of the plan assets invested
in international equities. The Pension Plan's exposure to foreign currency risk is as follows:
Investment Currency Fair Value
Common stock Euro $ 21,038,805
Common stock Japanese Yen 14,848,748
Common stock British Pound 13,011,494
Common stock Swiss Franc 4,771,407
' Common stock Australian Dollar
Common stock Singapore Dollar 1,903,710
569,414
Common stock Swedish Krona 1,739,325
Common stock Hong Kong Dollar 1,045,101
Common stock Danish Krone 327,366
Common stock Norwegian Krone 672,675
Fixed income Russian Rouble 103,100
Common stock Chinese Yuan Renminbi 184,330
' Common stock Canadian Dollar 87,479
Total $ 60,302,954
' Fi
'
R
li
f
d P
i
Pl
remen
an
s
e
e
ens
on
an
At year-end, the Firemen's Relief and Pension Plan cash and investment balances were as follows:
Amount Portfolio maturit
e
r
l
B
i
Cash and cash e
uivalents: y y
a
s at
ng
q
Equity in pooled cash $ 2,217,556 31.6% 3.05 See above
Total cash and cash equivalents
nvestments@ 2,217,556
U.S. agency - Federal Nat'l Mortgage Assn. (FNMA)
U.S. agency - Federal Home Loan Mortgage Corp. (FHLMC 4,360,478 62.1% 10.75
440,305 6.3% 0.94 AAA
AAA
Total investments 4,800,783
' Total managed cash and investments $
' S 7,018,339 100.0%
ee pooled cash note disclosure above
Interest Rate Risk - Firemen's Relief and Pension Plan:
As a means of limiting exposure to fair value losses arising from rising interest rates, the Firemen's Relief and Pension
Plan investment policy limits the target investment in fixed income investments to nor more than 70% of the portfolio.
There are no limits related to weighted average maturities due to the long-term nature of pension plan investing.
Credit Risk - Firemen's Relief and Pension Plan:
The Firemen's Relief and Pension Plan investment policy limits credit risk by restricting the fixed income investments to
investment grade securities, per a nationally recognized ranking agency.
' Concentration of Credit Risk - Firemen's Relief and Pension Plan:
The Firemen's Relief and Pension Plan investment policy limits concentration of credit risk by limiting the target allocation
' of the plan to domestic fixed income to 70% of the portfolio, with the remainder of the portfolio allocated to the City's well-
51
1
City of Clearwater, Florida
Notes to the Basic Financial Statements
For the Year Ended September 30, 2006
diversified pooled cash portfolio (see above disclosure). There are no additional limitations on concentrations with
individual issuers or agencies due to the relatively small portfolio of this closed pension plan.
Foreign Currency Risk - Firemen's Relief and Pension Plan:
The Firemen's Relief and Pension Plan investment policy does not permit investment in foreign fixed income or equity
securities.
Police Supplemental Pension Plan
At year-end, the Police Supplemental Pension Plan cash and investment balances were as follows:
Cash and cash equivalents:
Cash in bank
Cash in managed investment accounts
Total cash and cash equivalents
Investments:
Treasuries
U.S. agencies
Domestic corporate bonds
Domestic corporate bonds
Domestic stocks
Mortgage backed bonds
Total investments
Total managed cash and investments
Interest Rate Risk- Police Supplemental Pension Plan:
Carrying % of Weighted avg Moody's
Amount Portfolio maturity (years) ti
$ 16,194
J
1
149,362
165,556 1.3% n/a n/a
3,880,851 30.5% 7.86 AAA
685,991 5.4% 1.90 AAA
125,138
1.0%
72
5
Aa 1 /Aa2/Aa3 '
38,953 0.3% . A 1 /A2/A3
7,762,735 61.0% n/a n/a ,
65,304 0.5% 21.60 AAA
12,558,972
$ 12,724,528 100.0% '
As a means of limiting exposure to fair value losses arising from rising interest rates, the Police Supplemental Pension
Plan investment policy limits the duration of the fixed income portfolio to 125% of the duration of the Lehman Brothers
Government/Corporate Bond index. Additionally, no issues, Treasury, or Corporate Bonds may be purchased with
maturities in excess of 15 years.
Credit Risk - Police Supplemental Pension Plan:
The Police Supplemental Pension Plan investment policy limits credit risk by restricting equity investments to
corporations that are listed on one of the national or international stock exchanges. Additionally, fixed income security
investments are limited to "A" rated or higher corporate bonds, debentures, and preferred stocks; corporate debt
provided the corporation meets the standards set forth in section 185.06(1)(b), Florida Statues; and U.S. Government
and agency obligations. Finally, the investment policy requires that investment managers dispose of any issue that has
been downgraded below "A" as soon as is economically feasible.
Concentration of Credit Risk - Police Supplemental Pension Plan:
The Police Supplemental Pension Plan investment policy limits concentration of credit risk by limiting the investment in
common stock or capital stock of any one issuing company to 5% of the outstanding capital stock of the company.
Additionally, the policy limits any one-industry position to no more than 25% of the equity portfolio.
Foreign Currency Risk - Police Supplemental Pension Plan:
Risk of loss arises from changes in currency exchange rates. The Police Supplemental Pension Plan investment policy
does not have a formal policy to limit foreign currency risk, other than a guideline of no more than 10% of the plan assets
7
1
52
City of Clearwater, Florida
' Notes to the Basic Financial Statements
For the Year Ended September 30, 2006
invested in international equities. Investment in fixed income foreign investments is not permitted per the investment
policy. The Plan has no current exposure to foreign currency risk.
Firefighters Supplemental Pension Plan
At year-end, the Firefighters Supplemental Pension Plan cash and investment balances were as follows:
Carrying % of Weighted avg Moody's
'
Cash and cash equivalents: Amount Portfolio maturity (yearsl flaibg
Cash in managed investment accounts $ 825,586
' Total cash and cash equivalents
Investments: 825,586 10.7% n/a n/a
Treasuries 487,029 6.3% 14.09 AAA
Treasury inflation index notes 118,105 1.5% 6.69 AAA
U.S. agencies 164,236 2.1% 4.28 AAA
Domestic corporate bonds 5,001 0.1% AAA
Domestic corporate bonds 177,771 2.3% 10.40 Aal/Aa2/Aa3
Domestic corporate bonds 318,403 4.1% A1/A2/A3
Domestic corporate bonds 435,902 5.6% Baal/Baa2/Baa3
' Domestic stocks 4,433,511 57.6% n/a n/a
Mortgage backed bonds 751,620 9.7% 14.61 AAA
Total investments 6,891,578
' Total managed cash and investments $ 7,717,164 100.0%
Interest Rate Risk - Firefighters Supplemental Pension Plan:
As a means of limiting exposure to fair value losses arising from rising interest rates, the Firefighters Supplemental
' Pension Plan investment policy limits the duration of the fixed income portfolio to 135% of the duration of the Merrill
Lynch Master Bond Index.
Credit Risk - Firefighters Supplemental Pension Plan:
The Firefighters Supplemental Pension Plan investment policy limits credit risk by restricting equity investments to
securities that are fully and easily negotiable. Additionally, investments in corporations whose stock has been publicly
traded for less than one year are limited to 15% of the equity portfolio. An additional investment policy restriction is that
investment in equity securities whose market capitalization is less than $2 billion dollars shall be limited to 25% of the
total equity portfolio. Additionally, fixed income corporate security investments are limited to "Baa" rated (per Moody's) or
higher corporate bonds (investment grade). Finally, collateralized mortgage obligations must be backed by a federal
agency (i.e. GNMA, FHLMC, or FNMA) or rated Aaa by Moody's, and must pass the FFIEC High Risk Security Test on
an annual basis.
' Concentration of Credit Risk - Firefighters Supplemental Pension Plan:
The Firefighters Supplemental Pension Plan investment policy limits concentration of credit risk by limiting the investment
in common stock or capital stock of any one issuing company within an investment manager's portfolio to 5% of the
portfolio. Similarly, no more than 10% of a fixed income investment manager's portfolio may be invested in the securities
of any single corporate issuer per the plan investment policy. Finally, investments in collateralized mortgage obligations
are limited to 15% of the investment manager's total portfolio.
53
City of Clearwater, Florida
Notes to the Basic Financial Statements '
For the Year Ended September 30, 2006
Foreign Currency Risk - Firefighters Supplemental Pension Plan: '
Risk of loss arises from changes in currency exchange rates. The Firefighters Supplemental Pension Plan investment
policy does not have a formal policy to limit foreign currency risk, other than a guideline of no more than 10% of the plan
assets invested in international equities.
B. Receivables '
Receivables as of year-end for the City's governmental, proprietary, internal service, and fiduciary funds, including the
applicable allowances for uncollectible accounts for the proprietary funds, are segregated on the fund financial statements. '
The Mortgages, Notes, and Other Loans amount of $11,243,777 reported on the Governmental Funds balance sheet
includes $11,081,296 of long-term loans receivable that are not expected to be collected within the next fiscal year.
C. Capital assets ,
Capital asset activity for the year ended September 30, 2006:
Beginning Ending
Balance
Increases
Decreases
Transfers Balance '
Governmental Activities:
Non-depreciable capital assets:
Land $ 72,439,253 $ 1,298,602 $1,066,609 $(2,080,986) $ 70,590,260
Construction in progress
8,658,284
41681,003
3,737,977
- 9,601
310 '
Total non-depreciablecapital assets 81,097,537 5,979,605 4,804,586 ,
(2,080,986) 80,191,570
Depreciable capital assets:
Buildings 105,307,096 2,451,122 - - 107,758,218
Improvements other than buildings
17,326,807
1,957,924
7,820
- 19,276,911 '
Machinery and equipment 84,791,232 7,243,437 5,526,470 8,003 86,516,202
Infrastructure 88,601,359 3,073,741 - - 91,675
100
Total depreciable capital assets 296,026,494 14,726,224 5,534,290 ,
8,003 305,226,431
Less accumulated depreciation for: '
Buildings (17,965,511) (3,460,354) - - (21,425,865)
Improvements other than buildings (6,964,970) (813,588) - - (7,778,558)
Machinery and equipment (56,622,130) (7,026,776) (5,444,056) (4,002) (58,208,852)
Infrastructure (51,437,280) (2,777,513) - - (54,214,793)
Total accumulated depreciation (132,989,891) (14,078,231) (5,444,056) (4,002) (141,628,068)
Net depreciable capital assets 163,036,603 647,993 90,234 4,001 163,598,363
Net governmental activities capital assets $244,134,140 $ 61627,598 $4,894,820 $(2,076,985) $243,789,933 '
Beginning Ending
Balance Increases Decreases Transfers Balance
Business-type activities: '
Non-depreciable capital assets:
Land $ 26,215,507 $ - $ - $ 2,080,986 $ 28,296,493
Construction in progress 35,220,640 26,319,491 6,820,932 - 54,719,199
Total non-depreciable capital assets 61,436,147 26,319,491 6,820,932 2,080,986 83,015,692
Depreciable capital assets:
Buildings 23,514,964 220,616 - - 23,735,580
Systems and improvements other than buildings 365,940,288 13,727,422 - - 379,667,710
Machinery and equipment
8,344,582
992,823
327,931
(8,003) 9,001,471 '
Total depreciable capital assets 397,799,834 14,940,861 327,931 (8,003) 412,404,761
Less accumulated depreciation for:
Buildings (8,331,051) (871,947) - - (9,202,998) '
Improvements other than buildings (129,643,230) (9,421,935) - - (139,065,165)
Machinery and equipment (4,243,925) (873,724) (216,231) 41002 (4,897,416)
Total accumulated depreciation (142,218,206) (11,167,606) (216,231) 4,002 (153,165,579)
Net depreciable capital assets 255,581,628 31773,255 111,700 (4,001) 259,239,182 '
Net business-type activities capital assets $317,017,775 $30,092,746 $6,932,632 $ 2,076,985 $342,254,874
54
City of Clearwater, Florida
Notes to the Basic Financial Statements
For the Year Ended September 30, 2006
Depreciation expense was charged to functions / programs of the primary government as follows:
Governmental activities:
General government $ 860,988
Public safety 1,664,664
Physical environment 51,249
Transportation, including depreciation of general infrastructure assets 2,956,529
Culture and recreation 3,738,969
Capital assets held by the government's governmental internal service funds are
charged to the various functions based on their usage of the assets 4,805,832
Total depreciation expense - governmental activities $ 14,078,231
Business-type activities:
Water and sewer utility $ 6,593,069
Gas utility 1,570,743
Solid waste utility 261,080
Stormwater utility 1,291,017
Recycling utility 290,349
Marine operations 171,216
Aviation operations 206,450
Parking system operations 230,938
Harborview Center operations 552,744
Total depreciation expense - business-type activities $ 11,167,606
t
I
`t
7
Construction commitments
At September 30, 2006, material outstanding construction commitments were as follows:
Project
Beachwalk Project
Beachwalk Project
Beachwalk Project
Reclaimed Water Distribution System
Water Pollution Control Recycle Improvements
Water Main Improvements
Stevenson Creek Implementation Projects
Sewer System Pump Station Replacements
Water Line Relocations
Total Construction Commitments
Fund
Capital Improvement capital projects fund
Stormwater Utility enterprise fund
Water & Sewer Utility enterprise fund
Water & Sewer Utility enterprise fund
Water & Sewer Utility enterprise fund
Water & Sewer Utility enterprise fund
Stormwater Utility enterprise fund
Water & Sewer Utility enterprise fund
Water & Sewer Utility enterprise fund
D. Interfund receivables, payables, and transfers
1. Interfund balances
Construction
Commitments
Outstanding
$ 3,834,027
1,170,692
566,878
2,567,914
1,041,119
910,578
865,687
843,409
575.000
$ 12.375.304
As discussed in Note III-A, individual fund deficits in the consolidated cash pool, if any, have been reclassified as of
September 30, 2006, as interfund loans from the Capital Improvement Fund, which was selected by management for this
purpose. This reclassification results in a corresponding reduction in the cash equity in the Capital Improvement Fund,
offset by an increase in interfund receivables.
55
City of Clearwater, Florida
Notes to the Basic Financial Statements
For the Year Ended September 30, 2006
The amounts of the reclassified cash pool deficits, if any, as well as other individual fund interfund payable and
receivable balances (current), at September 30, 2006, were as follows:
Due from Due to
Fund Other Funds Other Funds
Special Revenue Fund:
Community Redevelopment Agency $ $ 120,401
Enterprise Fund:
Solid Waste Utility 82,474
Internal Service Funds:
Administrative Services 91,654
Central Insurance 294,529
$ 294,529 $ 294,529
Individual interfund advances (long-term) at September 30, 2006, follow:
Advances to Advances from
Fund Other Funds Other Funds
General Fund $ 2,000,000 $
Special Revenue Funds:
Special Programs 350,000
Community Redevelopment Agency 350,000
Capital Projects Fund:
Capital Improvement 4,480,983
Enterprise Funds:
Solid Waste Utility 2,480,983 494,842
Parking System 4,000,000
Internal Service Funds:
Administrative Services 824,882
Central Insurance 5,319,724
$ 10,150,707 $ 10,150,707
Descriptions of long-term interfund loans as of September 30, 2006•
An interfund loan from the Special Programs special revenue fund to the Community Redevelopment Agency special
revenue fund in the amount of $350,000 related to the purchase, remediation, and development of a downtown parcel.
Non-interest bearing internal loans to the Capital Improvement Fund from the Solid Waste Utility Fund and Central Insurance
Fund, in the amounts of $2,480,983 and $2,000,000, respectively, for financing of the City's Beachwalk project. It is
anticipated that the loans will be repaid as additional financing sources are realized including bond proceeds, federal grant
monies, and developer contributions.
An internal twenty year loan from the Central Insurance Fund to the Solid Waste Utility Fund for the construction of
administrative, container maintenance, and truck wash facilities, in addition to a paved yard for use by all cost centers of the
Solid Waste Fund. The loan provides for 20 annual payments of $82,474 together with interest at the cash-pool rate, due on
September 30 of each year, commencing September 30, 1994. The cost of the construction was $1,686,759.
Internal loans of $2,000,000 each from the General Fund and the Central Insurance Fund, at the cash-pool interest rate,
to the Parking Fund to fund a contingency reserve per the terms of a development agreement. The Parking Fund is
56
City of Clearwater, Florida
Notes to the Basic Financial Statements
For the Year Ended September 30, 2006
r
r
1
contributing an additional $2,000,000 to fund a total contingency of $6,000,000 for the repurchase of a land parcel if the
proposed development does not occur by December 2006. The loans commenced September 30, 2002.
An internal ten-year loan from the Central Insurance Fund to the Administrative Services Fund for the purchase and
installation of fiber optic cable and termination equipment. The loan provides for ten annual payments of $91,654 plus
interest at the cash-pool rate, due on September 30 of each year. The loan commenced September 30, 2003 with the
first annual principal payment due September 301h of the year that the infrastructure project is completed, currently
anticipated to be September 30, 2008.
2. Interfund transfers
Interfund transfers for the year ended September 30, 2006, consisted of the following:
Transfers to General Fund from:
1
F
r
t
1
Capital Improvements Fund $ 44,262
Water & Sewer Utility Enterprise Fund 2,358,030
Gas Utility Enterprise Fund 1,407,200
Solid Waste Utility Enterprise Fund 891,230
Stormwater Utility Enterprise Fund 521,910
Nonmajor governmental funds 697,693
Nonmajor enterprise funds 619,662
Total 6,539,987
Transfers to Special Development Fund from:
Capital Improvements Fund 1,106,559
Nonmajor enterprise funds 148,419
Total 1,254,978
Transfers to Capital Improvements Fund from:
General Fund 2,938,480
Special Development Fund 14,727,155
Nonmajor governmental funds 1,442,765
Total 19,108,400
Transfers to Solid Waste Utility Enterprise Fund from:
Nonmajor enterprise funds 10,248
Total 10,248
Transfers to Nonmajor governmental funds from:
General Fund 4,302,760
Special Development Fund 3,208,689
Capital Improvements Fund 440,100
Gas Utility Enterprise Fund 482
Nonmajor governmental funds 403,677
Total 8,355,708
Transfers to Nonmajor enterprise funds from:
General Fund 323,770
Nonmajor governmental funds 1,481
Total 323,770
Transfers to Internal service funds from:
General Fund 123,088
Capital Improvements Fund 91,095
Water & Sewer Utility Enterprise Fund 77,087
Gas Utility Enterprise Fund 4,002
Stormwater Utility Enterprise Fund 30,500
Solid Waste Utility Enterprise Fund 5,750
Internal service funds 132,681
Total 464.203
Total interfund transfers $ 36,057,294
Transfers are primarily used to 1) transfer revenues that have been collected in the required fund per state law to the funds
and activities that state law allows for expenditures; 2) transfer of "payment in lieu of taxes" contributions from the utility
57
City of Clearwater, Florida
Notes to the Basic Financial Statements
For the Year Ended September 30, 2006
funds to the General Fund; 3) transfer funding from governmental funds to debt service and capital improvements funds;
and 4) transfer matching funds from the General Fund to various grant programs.
E. Leases
The City purchases various equipment for governmental and business-type activities under lease purchase financing
agreements. The equipment is purchased with cash and subsequently provided as collateral via a "lease purchase"
financing arrangement, typically for a five-year term. Obligations under these lease purchase agreements are recorded at
the present value of their future minimum lease payments as of date of inception. Purchase of the assets is recorded as a
cash outflow and the subsequent receipt of the financing proceeds is recorded as "proceeds from issuance of debt' for
Statement of Cash Flows reporting.
Capitalized equipment subject to lease purchase financing as of September 30, 2006:
Governmental
Activities
Equipment $ 14,065,674
Less: Accumulated Depreciation (6,348,375)
Total $ 7,717,299
Business-type
Activities
$ 3,075,549
(1,236,962)
$ 1,838,587
The future minimum lease payments under capital lease purchase agreements are as follows as of September 30, 2006:
Governmental Business-type
Year Ending Sept. 30 Activities Activities
2007 $ 4,175,690 $ 747,622
2008 3,346,007 576,303
2009 2,335,667 439,542
2010 1,416,450 206,683
2011 581,672 61,820
11,855,486 2,031,970
Deduction of the amount of imputed interest necessary to
reduce net minimum lease payments to present value
(808,531)
(125,746)
.
$ 11,046,955 $ 1,906,224
The City also leases personal computers under a three-year operating lease that is cancelable on an annual basis. Lease
payments for fiscal year ended September 30, 2006, totaled $531,980. 1
11
City of Clearwater, Florida
Notes to the Basic Financial Statements
For the Year Ended September 30, 2006
F. Long-term debt
1. Revenue Bonds
$46,445,000 Infrastructure Sales Tax Revenue Bonds, Series 2001; issued for the
acquisition, construction, or reconstruction of certain capital improvements to the City,
including, but not limited to, a portion of the costs of constructing various capital
improvements relating to road and bridge projects and a new main library; with
$5,875,000 of principal due December 1, 2006, to $6,620,000 due December 1, 2009;
interest at 4.25% to 5.00%. $ 24,955,000
$11,470,000 Improvement Revenue Refunding Bonds, Series 2001; issued to provide a
portion of the funds necessary to defease the City's Florida Public Service Tax and
Bridge Revenue Bonds; serial bonds due in annual installments of $320,000 due
February 1, 2007, to $450,000 due February 1, 2016; interest at 3.35% to 4.60%; 5.25%
term bonds in the amount of $3,240,000 due February 1, 2022; and 5.00% term bonds in
the amount of $2,850,000 due February 1, 2026. 9,885,000
$14,810,000 Spring Training Facility Revenue Bonds, Series 2002; issued to provide a
portion of the costs of the acquisition, construction, rehabilitation, and equipping of a
spring training facility to be used by the Philadelphia Phillies major league baseball team;
serial bonds due in annual installments of $490,000 due March 1, 2007, to $295,000 due
March 1, 2022, with a maximum principal of $845,000 due March 1, 2021; interest at
2.625% to 5.375%; 5.375% term bonds in the amount of $1,730,000 due March 1, 2027;
and 5.375% term bonds in the amount of $1,750,000 due March 1, 2031. 13,245,000
Total revenue bonds for governmental activities 48.085.000
1
1
$43,642,690 Water and Sewer Refunding Revenue Bonds, Series 1998, capital
appreciation bonds with total maturity amount of $81,785,000; issued to refund the 1988
Series Water and Sewer Revenue Bonds; due in annual installments from December 1,
2005 to December 1, 2018; ranging from $5,775,000 to $5,875,000; with interest at 4.20%
to 5.22%. The balance outstanding as of September 30, 2006, includes capital
appreciation bond accreted interest of $19,240,828. 56,628,518
$58,680,000 Water and Sewer Revenue Bonds, Series 2002; issued to pay for costs of
expansions to the City's water and sewer system; serial bonds due in annual installments
of $1,090,000 due December 1, 2006, to $2,420,000 due December 1, 2024, interest at
3.25% to 5.00%; 5.00% term bonds in the amount of $11,050,000 due December 1,
2028; and 5.00% term bonds in the amount of $13,665,000 due December 1, 2032.
$8,410,000 Water and Sewer Revenue Refunding Bonds, Series 2003; issued to
advance refund the City's Water and Sewer Refunding Revenue Bonds, Series 1993;
serial bonds due in annual installments of $170,000 at December 1, 2006, to $260,000
due December 1, 2018, interest at 2.00% to 4.00%.
$26,430,000 Water and Sewer Revenue Refunding Bonds, Series 2006; issued to pay the
costs of the design, acquisition, construction, or reconstruction of capital improvements to
the City's water and sewer system; serial bonds due in annual installments of $1,410,000
at December 1, 2019, to $2,070,000 due December 1, 2028, interest at 4.25% to 4.50%;
4.50% term bonds in the amount of $4,410,000 due December 1, 2030; and 4.625% term
bonds in the amount of $4,795,000 due December 1, 2032.
$6,710,000 Gas System Revenue Refunding Bonds, Series 199713; issued to finance
costs of certain additions, extensions, supplements, or replacements of the existing gas
system owned and operated by the City within Pinellas and Pasco Counties, and to
advance refund the City's Gas System Revenue Bonds, Series 1991; serial bonds due in
annual installments of $440,000 due September 1, 2007 to $565,000 due September 1,
2013, interest at 4.50% to 5.00%.
55,735,000
2,730,000
26,430,000
3,500,000
59
?J
City of Clearwater, Florida
Notes to the Basic Financial Statements
For the Year Ended September 30, 2006
$8,020,000 Gas System Revenue Refunding Bonds, Series 1998; issued to advance
refund the City's Gas System Revenue Bonds, Series 1994A; serial bonds due in annual
installments of $40,000 due September 1, 2007, to $50,000 due September 1, 2012,
interest at 4.20% to 4.60%; additional serial bond annual installments ranging from
$620,000 to $755,000 from September 1, 2015 to September 1, 2019, interest at 4.75%
to 4.90%; 4.70% term bonds in the amount of $645,000 maturing September 1, 2014; and
5.00% term bonds in the amount of $3,410,000 maturing on September 1, 2023. 7,750,000
$8,890,000 Gas System Revenue Refunding Bonds, Series 2004; issued to advance
'
refund the City
s Gas System Revenue Bonds, Series 1996A; serial bonds due in annual
installments of $170,000 due September 1, 2007, to $1,575,000 due September 1, 2026,
interest at 2.00% to 4.375%. 8,545,000
$7,195,000 Gas System Revenue Refunding Bonds, Series 2005; issued to partially
advance refund the City's Gas System Revenue Refunding Bonds, Series 1997A and
Series 19976; serial bonds due in annual installments of $205,000 due September 1,
2007, to $325,000 due September 1, 2025, interest at 3.00% to 4.375%; and 4.375% term
bonds in the amount of $2,400,000 maturing on September 1, 2027. 7,135,000
$7,500,000 Stormwater Revenue Bonds, Series 1999; issued to finance the costs of
capital improvements to the City's stormwater management system; with $145,000 of
principal due November 1, 2006, to $160,000 due November 1, 2008, interest at 4.55% to
4.75%. 460,000
$24,685,000 Stormwater Revenue Bonds, Series 2002; issued to finance the costs of
capital improvements to the City's stormwater management system; serial bonds due in
annual installments of $470,000 due November 1, 2006, to $965,000 due November 1,
2023, interest at 3.00% to 4.75%; and 4.75% term bonds in the amounts of $3,205,000,
$5,115,000, and $2,985,000, due November 1, 2026, 2030, and 2032, respectively. 23,345,000
$14,430,000 Stormwater System Revenue Bonds, Series 2004; issued to finance the
'
costs of capital improvements to the City
s stormwater management system; serial
bonds due in annual installments of $325,000 due November 1, 2006, to $865,000 due
November 1, 2032, interest at 1.65% to 4.75%. 14,110,000
$6,925,000 Stormwater System Revenue Bonds, Series 2005; issued to partially
advance refund the Stormwater Revenue Bonds, Series 1999; serial bonds due in
annual installments of $45,000 due November 1, 2006, to $470,000 due November 1,
2029, interest at 3.00% to 4.50%. 6,915,000
Total revenue bonds for business-type activities 213,283,518
Total revenue bonds $ 261.368.518
2. Restrictive covenants and collateral requirements
The Infrastructure Sales Tax Revenue Bonds are limited obligations of the City payable solely from and secured by a lien
upon and a pledge of the City's share of the proceeds derived by Pinellas County from the levy and collection of the one-
cent discretionary infrastructure sales tax pursuant to Section 212.055(2), Florida Statutes, as amended (the Sales Tax
Revenues) and, until applied in accordance with the provisions of the Ordinance, all moneys, including investments
thereof, in the funds and accounts established by the Ordinance, other than the Rebate Fund (collectively the "Pledged
Revenues"). The pledge of the Sales Tax Revenues does not constitute a lien upon any property of the City. The
covenants of the ordinance authorizing the bonds include, among other things, an obligation of the City to do all things
necessary on its part to continue the levy and collection of the Sales Tax Revenues at the maximum rate permitted by
and in compliance with Chapter 166, Part II, Florida Statutes, as amended, Chapter 212, Part I, Florida Statutes, as
amended, and other applicable provisions of law (the "Act"), and any successor provision of the law. The City further
60
City of Clearwater, Florida
Notes to the Basic Financial Statements
For the Year Ended September 30, 2006
covenants to proceed diligently to perform legally and effectively all steps required on its part in the levy and collection of
the Sales Tax Revenues and shall exercise all legally available remedies to enforce such collections now or hereafter
available under State law.
The Improvement Revenue Refunding Bonds are limited obligations of the City payable solely from and secured by a lien
upon and a pledge of the Public Service Tax as authorized by Section 166.231, Florida Statutes, as amended. The
pledge of the Public Service Tax does not constitute a lien upon any property of the City. The covenants of the
ordinance authorizing the bonds include, among other things, an obligation of the City to do all things necessary on its
part to continue the levy and collection of the Public Service Tax at the rate permitted by and in compliance with Section
166.231, Florida Statutes, and Article III, Chapter 44, Code of Ordinances of the Issuer, and any successor provision of
law. The Public Service tax is a revenue of the General Fund.
The Spring Training Facility Revenue Bonds are special, limited obligations of the City, payable solely from and secured
by a lien upon and pledge of the (1) payments received by the City from the State of Florida pursuant to Section 212.20,
Florida Statutes (State Payments); and (ii) payments received by the City from Pinellas County, Florida pursuant to the
Interlocal Agreement dated December 1, 2000 (County payments). The pledge of the State Payments and County
Payments does not constitute a lien upon any property of the City. Furthermore, neither the City, Pinellas County, the
State of Florida, nor any political subdivision thereof has pledged its faith or credit or taxing power to the payment of the
bonds.
The Water and Sewer Refunding Revenue Bonds, Series 1998; the Water and Sewer Revenue Bonds, Series 2002; the
Water and Sewer Refunding Revenue Bonds, Series 2003, and the Water and Sewer Revenue Bonds, Series 2006 are
limited obligations of the City payable solely from and secured by a lien upon and pledge of the net revenues of the City's
water and sewer system (System). The pledge of the System's net revenues does not constitute a lien upon any property
of the City. The covenants of the ordinances authorizing the bonds include, among other things, an obligation of the City
to fix and maintain such rates, and collect such fees, rentals and other charges for the services and facilities of the
System and revise the same from time to time whenever necessary, which will provide gross revenues in each fiscal year
sufficient to pay the cost of operation and maintenance of the system; one hundred fifteen percent (115°/x) of the bond
service requirement becoming due in such fiscal year on the outstanding bonds; plus one hundred percent (100%) of all
reserve and other payments required to be made pursuant to the ordinances authorizing the bonds. The City further
covenants that such rates, fees, rentals and other charges will not be reduced so as to render them insufficient to provide
gross revenues for such purpose.
The Gas System Revenue Refunding Bonds, Series 199713; Gas System Revenue Refunding Bonds, Series 1998; Gas
System Revenue Refunding Bonds, Series 2004; and Gas System Revenue Refunding Bonds, Series 2005 are limited
obligations of the City payable solely from and secured by a lien upon and pledge of the net revenues of the City's gas
system (System). The pledge of the System's net revenues does not constitute a lien upon any property of the City. The
covenants of the ordinances authorizing the bonds include, among other things, an obligation of the City to fix, establish,
revise from time to time whenever necessary, maintain and collect always, such fees, rates, rentals and other charges for
the use of the product, services and facilities of the System which will always provide revenues in each year sufficient to
pay, and out of such funds pay, 100% of the cost of operations and maintenance of the system in such year and all
reserve and other payments provided for in the ordinances authorizing the bonds, along with one hundred twenty five
percent (125%) of the bond service requirement due in such year on all outstanding bonds.
The Stormwater System Revenue Bonds, Series 1999; Stormwater Revenue Bonds, Series 2002; Stormwater Revenue
Bonds, Series 2004; and Stormwater Revenue Refunding Bonds, Series 2005 are limited obligations of the City payable
solely from and secured by a lien upon and pledge of the net revenues of the City's stormwater management system
(System). The pledge of the System's net revenues does not constitute a lien upon any property of the City. The
covenants of the ordinances authorizing the bonds include, among other things, an obligation of the City to fix, revise
from time to time whenever necessary, and maintain and collect always such fees, rates, rentals and other charges for
use of the products, services, and facilities which will always provide net revenues in each year sufficient to pay one
hundred fifteen percent (115%) of the bond service requirement becoming due in such fiscal year on the outstanding
bonds. The City further covenants that such rates, fees, rentals and other charges will not be reduced so as to render
them insufficient to provide revenues for such purpose. Additionally, the covenants of each of the above issues includes
a "Reserve Requirement" equal to the lesser of: the Maximum Bond Service Requirement for any given year; 125% of
i
61
City of Clearwater, Florida
Notes to the Basic Financial Statements
For the Year Ended September 30, 2006
the Average Annual Bond Service Requirement; or the largest amount as shall not adversely affect the exclusion of
interest on the Bonds from gross income for Federal income tax purposes. A Reserve Fund has been funded for the
Series 2002 and Series 2004 Bonds while the Series 1999 and Series 2005 Reserve Requirements have been satisfied
with Reserve Fund Surety Bonds.
Annual debt service requirements to maturity for revenue bonds are as follows:
F
1
Revenue Bonds
Year Ending Governmental Activities Business-ty pe Activities
September 30 Principal Interest Principal Interest
2007 $ 6,685,000 $ 1,945,793 $ 6,408,385 $ 9,170,29T-
2008 6,935,000 1,674,198 6,564,869 9,208,241
2009 7,210,000 1,397,571 6,894,399 8,956,688
2010
2011 7,505,000
920,000 1,108,330
943,694 7,135,664
7,441,399 8,685,441
8,389,873
2012-2016 5,145,000 4,152,946 42,534,960 36,655,849
2017-2021 6,450,000 2,806,616 43,563,842 26,282,044
2022-2026 5,100,000 1,347,342 37,150,000 17,885,630
2027-2031 2,135,000 298,447 38,920,000 8,632,609
2032-2036 - - 16,670,000 813,503
Totals $ 48,085,000 $ 15,674,937 $ 213,283,518 $134,680,177
3. Advance refunding of bonds
In prior fiscal years, the City entered into various advance-refunding transactions related to certain of its bonded debt.
A portion of the proceeds of the refunding bond issues was placed in trust and used to purchase securities of the United
States Government and related agencies at various interest rates and maturities sufficient to meet all debt service
requirements of the refunded debt, of which $17,745,000 was outstanding at September 30, 2006. These assets are
administered by trustees and are restricted to use for retirement of the refunded debt. The liability for the refunded
bonds and the related securities and escrow accounts are not included in the accompanying financial statements as the
City defeased its obligation for payment of the refunded bonded debt upon completion of the refunding transactions.
The following schedule reflects the outstanding principal on refunded bonds as of September 30:
Governmental Activities:
Utility Revenue Bonds, Series 1978
$ 11,460,000
Total Governmental Activities
Business-type Activities:
Stormwater System Revenue Bonds, Series 1999
Total Business-type Activities
Total
11,460,000
6,285,000
6,285,000
$ 17,745,000
1
1
r
62
City of Clearwater, Florida
Notes to the Basic Financial Statements
For the Year Ended September 30, 2006
4. Changes in long-term liabilities
1
r
t
1
1
Governmental activities:
Revenue bonds payable
Add (subtract) deferred amounts:
For issuance premiums (discounts)
On refunding
Net revenue bonds payable
Lease purchase contracts
Compensated absences
Claims payable
Governmental activity
Long-term liabilities
Business-type activities:
Revenue bonds payable
Less deferred amounts:
For issuance premiums (discounts)
On refunding
Net revenue bonds payable
Lease purchase contracts
Compensated absences
Claims payable
Business-type activity
Long-term liabilities
Beginning Ending Due Within
Balance Additions Reductions Balance One Year
$ 54,576,170 $ - $ (6,491,170) $ 48,085,000 $ 6,685,000
612,616 -
(333,523) -
54,855,263 -
9,891,318 5,447,706
6,766,281 1,103,234
10,152,000 1,540,904
(121,835) 490,781 -
25,386 (308,137)
(6,587,619) 48,267,644 6,685,000
(a) (4,292,069) 11,046,955 3,810,394
(730,934) 7,138,581 682,163
(2,092,904) 9,600,000 2,399,200
$ 81,664,862 $ 8,091,844 $(13,703,526) $ 76,053,180 $13,576,757
$ 192,979,804 $ 29,102,544
(1,449,236) (336,113)
(4,567,053) -
186,963,515 28,766,431
2,330,272 446,157
1,730,846 243,171
376,776 -
$ (8,798,830) $213,283,518 $ 9,120,000
110,777 (1,674,572)
454,653 (4,112,400)
(8,233,400) 207,496,546 9,120,000
(870,205) 1,906,224 688,659
(183,351) 1,790,666 171,116
376,776 -
$ 191,401,409 $ 29,455,759 $ (9,286,956) $211,570,212 $ 9,979,775
(a) Lease purchase contracts additions of $5,447,706 includes $4,552,285 attributable to Internal Service funds and
$895,421 attributable to governmental funds.
G. Restricted assets
1. Water and Sewer Utility Fund
Assets in the Water and Sewer Utility Fund restricted for construction include:
Water Improvement charges, the use of which is restricted by the authorizing ordinance to the
construction of additions and improvements to the water system; assets remaining at
September 30, 2006, are:
Equity in Pooled Cash and Investments
Sewer Improvement charges, the use of which is restricted by the authorizing ordinance to the
construction of additions and improvements to the sewer system; assets remaining at
September 30, 2006, are:
Equity in Pooled Cash and Investments
Assets of the Water and Sewer Utility Fund restricted under the provisions of the ordinances
authorizing the issuance of Water and Sewer Revenue Bonds consisted of the following at
September 30, 2006:
$ 1,727,779
5,342,872
63
City of Clearwater, Florida
Notes to the Basic Financial Statements
For the Year Ended September 30, 2006
Water and Sewer Revenue Bonds Debt Service:
Equity in Pooled Cash and Investments 17,979,662
Water and Sewer Revenue Bonds Renewals and Replacements:
Equity in Pooled Cash and Investments
4,356,873
Water and Sewer Revenue Bonds Construction:
Equity in Pooled Cash and Investments 16,790,518
Assets of the Water and Sewer Utility Fund representing Customers' Deposits and therefore
restricted, consisting entirely of Equity in Pooled Cash and Investments at September 30, 2006 2,259,631
Total restricted assets - Water and Sewer Utility Fund 8.457.335
2. Gas Utility Fund
Assets in the Gas Utility Fund restricted under the provisions of the ordinance authorizing the issuance of revenue bonds
consisted of the following at September 30, 2006:
Gas System Revenue Bonds
Debt Service:
Equity in Pooled Cash and Investments $ 168,123
Renewals and Replacements:
Equity in Pooled Cash and Investments 300,000
Assets of the Gas Utility Fund representing Customers' Deposits at September 30, 2006:
Equity in Pooled Cash and Investments 2.018.399
Total restricted assets - Gas Utility Fund $2,486,522
3. Solid Waste Utility Fund
Restricted assets in the Solid Waste Utility Fund designated for construction represent customer deposits in the amount of
$954,530 at September 30, 2006, and consisted entirely of Equity in Pooled Cash and Investments.
4
Stormw
t
Utilit
F
d
.
a
er
y
un
Assets restricted under the provisions of the ordinances for the issuance of revenue bonds consisted
of the following at September 30, 2006:
Stormwater System Revenue Bonds - Series 1999
Debt Service: Equity in Pooled Cash and Investments $ 141,835
Construction: Equity in Pooled Cash and Investments 209,189
Stormwater Revenue Bonds - Series 2002
Debt Service: Equity in Pooled Cash and Investments 2,422,986
Construction: Equity in Pooled Cash and Investments 3,018,428
Stormwater Revenue Bonds - Series 2004
Debt Service: Equity in Pooled Cash and Investments 1,439,923
Construction: Equity in Pooled Cash and Investments 4,097,800
Stormwater Refunding Revenue Bonds - Series 2005
Debt Service: Equity in Pooled Cash and Investments 155,547
Fees received in lieu of on-site drainage retention for new or improved businesses within the
Prospect Lake Drainage District, restricted for stormwater improvements, at September 30, 2006:
Equity in Pooled Cash and Investments 32.506
Total restricted assets - Stormwater Utility Fund 11.518.214
64
City of Clearwater, Florida
Notes to the Basic Financial Statements
For the Year Ended September 30, 2006
1
?J
1
r
5. Parking System Fund
Assets in the Parking System restricted under the provisions of a development agreement between
Clearwater Seashell Resort LC and the City of Clearwater as of September 30, 2006:
Equity in Pooled Cash and Investments $ 6,000,000
Contributions from the Special Development Fund from developer payments in lieu of parking,
restricted for downtown parking; assets remaining at September 30, 2006:
Equity in Pooled Cash and Investments 1.500.000
Total restricted assets - Parking System Fund I500
Note IV - Other Information
A. Risk management
The City is self-insured within certain parameters for losses arising from claims for general liability, auto liability, police
professional liability, public official's liability, property damage, and workers' compensation. Insurance coverage has
been maintained by the City to pay for or indemnify the City for losses in excess of certain specific retentions and up to
specified maximum limits in the case of claims for liability, property damage, and workers' compensation. The liability
excess coverage is $7,000,000 per occurrence ($14,000,000 aggregate) with self-insured retention of $500,000. There
is workers' compensation coverage to the statutory limit, with self-insured retention of $500,000. The property damage
excess coverage is $409,000,000 (Total Insured Value) with a $500,000 self-insured retention. Settled claims have not
exceeded excess coverage in any of the past three years.
The transactions relating to the self-insurance program are accounted for in the Central Insurance Fund, an Internal
Service Fund. The billings by the Central Insurance Fund to the various operating funds (the interfund premiums) are
based on actuarial estimates of the amounts needed to pay prior and current year claims. The claims liability reported at
September 30, 2006, is based on the requirements of Governmental Accounting Standards Board Statement No. 10,
which requires that a liability for claims be reported if information prior to the issuance of the financial statements
indicates that it is probable that a liability has been incurred at the date of the financial statements and the amount of the
loss can be reasonably estimated.
Changes in the claims liability amounts in fiscal years 2005 and 2006 were:
Balance at October 1, 2004
Current year claims and changes in estimates
Claim payments
Balance at September 30, 2005
Current year claims and changes in estimates
Claim payments
Balance at September 30, 2006
Self
Insurance
$ 10,459,811
2,190,375
(2,121,410)
10,528,776
1,540,904
(2,092,904)
$ 9,976,776
65
City of Clearwater, Florida
Notes to the Basic Financial Statements
For the Year Ended September 30, 2006
B. Statements of cash flows
For purposes of the statements of cash flows, investments with original maturities of three months or less are considered to
meet the definition of cash equivalents. The majority of the investments in which the City's proprietary funds have equity are
held by the City's consolidated pool of cash and investments. Since fund equities in this cash management pool have the
general characteristics of demand deposits in that additional funds may be deposited at any time and also funds may be
withdrawn at any time without prior notice or penalty, each fund's equity account is considered a cash equivalent regardless
of the maturities of investments held by the pool. Funds with deficit (overdraft) positions within the consolidated pool report
the deficits as interfund payables to the City's Capital Improvement Fund.
C. Use of estimates
The preparation of financial statements in conformity with generally accepted accounting principles (GAAP) requires
management to make estimates and assumptions that affect the amounts reported in the financial statements and
accompanying notes. Actual results could differ from the estimates.
D. Employee retirement systems and pension plans
1. Defined benefit pension plans
The City contributes to two separate single-employer, self-administered defined benefit pension plans covering
approximately three-fourths of all City employees. The Employees' Pension Plan covers all permanent, full-time City
employees who successfully pass the required physical examination, except for firefighters employed prior to July 1, 1963,
and certain nonclassified (primarily managerial) employees. The Firemen's Relief and Pension Plan covered eligible
firefighters hired prior to July 1, 1963, and is closed to new entrants. Neither of these plans issues a stand-alone financial
report. As indicated, both plans are self-administered, and the costs of administering the plans are paid from the respective
plan assets.
The Employees' Pension Plan is authorized by and operates under the provisions of Sections 2.391 through 2.411 of the
Municipal Code of the City of Clearwater. Plan provisions have been duly approved as required by the voters in
referendums. There were no changes in plan provisions or actuarial assumptions for the current year. The normal
retirement benefit is a monthly benefit equal to 2-3/4% of average monthly compensation for the highest five of the final ten
years of service multiplied by the number of years of service to date of retirement. The minimum benefit under the plan is
$300 per month. Eligibility for normal retirement occurs upon completion of at least 10 years of service and the attainment
of age 65, or completion of at least 20 years of service and the attainment of age 55, or completion of 30 years of service,
for employees engaged in non-hazardous duty. For those engaged in hazardous duty, eligibility occurs upon completion of
20 years of service. The normal monthly benefits are payable for the life of the participant and continue, after the
participant's death, to be paid at the same amount for 5 years to eligible surviving beneficiaries; after 5 years, the survivor
annuity is reduced to fifty percent (50%) of the original amount. The plan provides for an annual cost of living increase of up
to one and one-half percent (1-1/2%). The plan also provides for disability and death benefits, vesting after completion of
10 years of service and the refund of employee contributions in case of a non-vested termination. There are seven other
benefit payment options that are computed to be the actuarial equivalent of the normal benefit. Covered employees
'
contribute 8% of their compensation. It is the City
s obligation to provide a sufficient additional contribution to maintain the
actuarial soundness of the fund but, in any event, not less than 7% of participating employee's compensation per the
ordinance governing the plan.
The Firemen's Reli
f
d P
i
Pl
i
h
i
e
an
ens
on
an
s aut
or
zed and operated under the provisions of Subpart B, Article I (Laws of
Florida, Chapter 30658, 1955 and amendments), Sections 1 through 27 of the Municipal Charter and Related Law of
the City of Clearwater and Chapter 26, Article III, Sections 26.50 through 26.52 of the Municipal Code of the City of
Clearwater. There were no changes in plan provisions or actuarial assumptions for the current year. The normal
retirement benefit is a monthly benefit in the amount of 50% of the prevailing wage at the date of retirement of the
City of Clearwater, Florida
Notes to the Basic Financial Statements
For the Year Ended September 30, 2006
lowest rank held by the participant during the three years immediately preceding retirement plus 2% of such prevailing
wage for each year of service in excess of 20 years up to a maximum of 60%. Participants retiring at the age of 65
years are entitled to a benefit of 60% of the prevailing wage of the lowest rank held by the participant during the three
years immediately preceding retirement. The ending rate of pay specified above may not exceed the highest rate of pay
for the rank of Captain. Eligibility for normal retirement occurs upon completion of 20 years of service or attainment of
age 65. The monthly benefits are payable for the life of the participant and continue, after the participant's death, to be
paid to certain eligible surviving beneficiaries at an amount that is one-half of the amount received by the participant.
Benefits are also provided for children of the deceased participant who are less than 18 years of age subject to certain
limitations as to amount. The plan also provides for disability and death benefits and for vesting upon completion of at
least 12 years of service. The plan provides for post retirement cost of living increases equal to the increase in the
prevailing wage for the rank at which the participant retired with a limitation for those retiring on or after January 1,
1972, of 100% of the initial pension benefit for total cost of living increases. Participating employees are required to
contribute 6% of their salaries up to the equivalent of the salary of a fireman holding the rank of Captain. The City is
required to contribute a sufficient additional amount to maintain the actuarial soundness of the plan for a period of 35
years commencing January 1, 1972. This contribution is based upon, but not limited to, the amount of property tax that
a levy of 0.6 mills would produce.
W As of the January 1, 2005, actuary valuation date (upon which the current fiscal year funding is based), the membership
of the plans was as follows:
Employees' Firemen's Relief
Pension Plan Pension Plan
Retirees and beneficiaries currently receiving benefits 686 46
Terminated employees entitled to benefits but not yet receiving them 54
Active employees:
Fully vested 725 -
Nonvested 936 -
Total number of participants 2,401 46
For the fiscal year ended September 30, 2006, the covered payroll for the Employees' Pension Fund was $74,529,562.
The City's total payroll for the same period was $84,984,904. Annual pension cost and contributions information for the last
three fiscal years for both the Employees' Pension Plan and the Firemen's Relief Pension Plan follows:
Employees' Pension Plan
Year Annual (a) Net
Ended Pension Employer Percent Pension
Sept 30 Cost Contributions Contributed Asset
2004 $ 5,215,750 $ 4,843,053 (b) 93% $ 25,459,838
2005 $ 6,505,390 $ 5,128,648 (b) 79% $ 24,083,096
2006 $12,665,728 $ 7,400,205 (b) 58% $ 18,817,573
(a) The actuarially determined contribution requirements for the City's fiscal year ended September 30, 2006, are based
on actuarial valuations as of January 1, 2005. Since the City's contributions are made during its fiscal year (which
commences nine months after the date of the actuarial valuation), the City, with approval of State regulatory
authorities, is following the practice of adding interest to its required contributions at the assumed rate of return on
investments for a period of one year.
(b) The employer contribution is less than the annual pension cost due to a "drawdown" of the net pension asset. The net
pension asset is the result of legally required contributions in excess of actuarially required contributions in prior years.
67
City of Clearwater, Florida
Notes to the Basic Financial Statements
For the Year Ended September 30, 2006
Firemen's Relief Pension Plan
Year Annual (a)
Ended Pension Employer Percent
Sept 30 Cost Contributions Contributed
2004 $ 1,264,729 $ 1,271,562 101%
2005 $ 1,331,045 $ 1,331,045 100%
2006 $ 1,397,390 $ 1,397,390 100%
a) The actuarially determined contribution requirements for the City's fiscal year ended September 30, 2006, are based
on actuarial valuations as of January 1, 2005. Since the City's contributions are made during its fiscal year (which
commences nine months after the date of the actuarial valuation), the City, with approval of State regulatory
authorities, is following the practice of adding interest to its required contributions at the assumed rate of return on
investments for a period of one year.
1
The Employees' Pension Fund net pension asset at September 30, 2006, totaled $18,817,573. It was comprised of the
following components:
Annual required contributions (ARC) $ 11,614,495
Interest on the net pension asset (1,806,232)
Adjustment to annual contribution 2,857,465
Annual pension cost 12,665,728
Fiscal 2006 employer contributions 7,400,205
Decrease in net pension asset (5,265,523)
Net pension asset beginning of year 24,083,096
Net pension asset end of year $ 18,817,573
The amount of the pension asset at transition (October 1, 1997) was $3,503,365.
The net pension asset for the Employees' Pension Plan, representing excess contributions as calculated per GASB 27
requirements, is identical in amount to the plan "credit balance" as disclosed in prior years. A total of $12,935,311 of the
current net pension asset balance is attributable to governmental funds and therefore is not reflected in the
governmental fund financial statements in accordance with the modified accrual basis of accounting. The remaining
$5,882,262 attributable to proprietary funds is reflected in the proprietary fund financial statements on the accrual basis
of accounting.
Each pension fund is accounted for as a pension trust fund; therefore each is accounted for in substantially the same
manner as proprietary funds with a "capital maintenance" measurement focus and the accrual basis of accounting. Fund
assets, primarily investments, are valued at fair value for balance sheet purposes, in accordance with GASB No. 25.
Investment values are determined using the estimated fair value determined by averaging estimated fair values
obtained from three or more nationally recognized brokers.
As of September 30, 2006, neither the Employees' Pension Fund nor the Firemen's Relief and Pension fund held
investments (other than U.S. Government or U.S. Government guaranteed obligations) in any one organization
comprising 5% or more of the net assets available for benefits.
Significant actuarial assumptions utilized in the actuarial valuations as of January 1, 2005, are as follows:
Employees' Pension Plan
(1) Assumed rate of return on investments of 7.5% per annum.
(2) Projected salary increase at a rate of 6% per year, including both cost-of-living adjustments of 3% and merit
or seniority increases at 3%.
(3) Mortality based on the 1994 Group Annuity Reserving Table for males with female ages set back five years.
68
City of Clearwater, Florida
' Notes to the Basic Financial Statements
For the Year Ended September 30, 2006
(4) Pre-retirement withdrawals assumed to occur in accordance with a table of declining withdrawal rates for male,
female, and hazardous duty categories.
(5) Pre-retirement incidence of disability is assumed to occur in accordance with a standard scale of moderate
disability rates (Class 1, 1952 Inter-Company); rates for females assumed to be twice that for males.
Firemen's Relief and Pension Plan
(1) Assumed rate of return on investments of 4.5% compounded annually.
(2) Assumed benefits grow at an annually compounded rate of 2%. There are no longer any active members in
this plan.
(3) Mortality based on the 1994 Unisex Mortality Table for retired participants; assumed disabled participants will
experience mortality according to PBGC Tables 3 and 4 for males and females, respectively.
(4) Assumed no withdrawals will occur.
(5) Assumed probability of an active participant becoming disabled is zero (no active participants).
(6) Assumed value of one mill of ad valorem tax will increase at rate of 5% per year.
The actuarial valuation of the Employees' Pension Fund as of January 1, 2002, reflected several changes in actuarial
assumptions, as follows: An investment yield of 7.5% assumed whereas the prior valuation assumed 7.0%. Salaries
were projected to increase at 6% versus the prior valuation assumption of 5%. Employee turnover rates were revised
for male and female employees and separate rates were adopted for hazardous duty employees. The mortality table
was changed from the 1983 Group Annuity Mortality Table to the 1994 Group Annuity Reserving Table. And finally, the
retirement age assumption was changed from 100% retirement at first eligibility for unreduced benefits to a table of
decrements at different ages. The impact of these changes decreased the unfunded actuarial accrued liability from
$72,178,974 to $41,332,472.
The actuarial valuation of the Firemen's Relief and Pension Fund as of January 1, 2003, reflected two changes in
actuarial assumptions. The report assumed an investment yield of 4.5% versus the prior valuation assumption of 5.5%.
Also, the mortality pattern assumption was changed to the 1994 Unisex Mortality Table from the 1983 Group Annuity
Mortality Table. The impact of these changes increased the unfunded actuarial accrued liability from $3,222,326 to
$4,742,517.
It is the City's policy to fund pension costs accrued as determined on an actuarial basis. Annual required contributions
(ARC) for the Employees' Pension Fund are calculated using the Entry Age Normal with Frozen Initial Liability method.
The initial unfunded actuarial accrued liability determined at July 1, 1963, was amortized over a 40-year period; changes
made in 1979 and subsequent years, which have had the effect of either increasing or decreasing the actuarial liability,
are being amortized over a 30-year period from their effective dates in accordance with State law. The amortization
method is level dollar closed.
Annual required contributions (ARC) for the Firemen's Relief and Pension Fund are based on a variation of the
aggregate actuarial cost method, under which the unfunded portion of the present value of the projected benefits is
allocated over the present value of a 6.0% per year increasing annuity for the remaining years in the 35-year funding
period which began January 1, 1972, pursuant to an agreement between the City and the Plan participants. For this
purpose, the unfunded actuarial liability is determined after consideration of the available assets at the valuation date.
The increasing fixed schedule produced by this method was established in 1988 and will be modified in the future only
to the extent that a current valuation indicates a higher required cost level, or if the resulting cost level exceeds 60% of a
mill in a current year. Under the non-standard cost method used for this plan (due to the fact that there are no longer
any active employees), all liabilities are unfunded actuarial liabilities and are being amortized according to the closed
cost method. This method does not identify or separately amortize unfunded actuarial accrued liabilities.
Governmental Accounting Standards Board Statement Nos. 25 and 27 require the presentation, as supplementary
information, of certain 6-year historical trend information. The disclosures follow these Notes to the Financial Statements.
69
City of Clearwater, Florida
Notes to the Basic Financial Statements ,
For the Year Ended September 30, 2006
2. Police Supplemental Pension Fund
A supplemental defined contribution pension plan exists for all eligible policemen, which is funded by earmarked
revenues received from the State and is administered by the Board of the Police Supplemental Pension Plan. The
revenues received from the State are allocated among eligible police officers on the basis of days employed as
Clearwater Police Officers. These revenues, which comprise the plan contributions, amount to $977,412 in the year
ended September 30, 2006, and are obtained from an eighty-five one hundredths of one percent (.85)% excise tax on
the gross receipts from premiums collected on casualty insurance policies covering property within the City's corporate
limits. The current year contributions represent 5.8% of current year covered payroll. The fair value of investments at
September 30, 2006, totaled $12,708,334.
The Police Supplemental Pension Fund is authorized by and operates under the provisions of Sections 2.471 through I?
2.480 of the Municipal Code of the City of Clearwater and Chapter 185 of Florida Statutes. Under the plan provisions, the
total monies received during each fiscal year, after payment or provision for all costs and expenses of management and
operation of the plan, are allocated to participants on the basis of the total number of shares to which each participant is
entitled. Each participant is entitled to one share in the fund for each day of service as a police officer of the City.
All police officers, as defined in Section 26.70(g) of the Code of Ordinances of the City of Clearwater, who are elected,
appointed, or employed full-time by the City are eligible to participate in the plan. There are no employee contributions
to the supplemental plan. Benefits are fully vested for a lump sum distribution after twenty years from the date of hire,
with provision for partial vesting after ten or more years under the plan. Accumulated benefits are payable in full in case
of death while employed by the City or in case of total and permanent job-related disability. Non-vested participants'
account values upon termination of employment during any fiscal year are added to the monies received during that
fiscal year for allocation to the remaining participants in the plan on the basis of total days worked.
F
'
'
or the fiscal year ended September 30, 2006, the payroll of the covered officers
was $16,981,204; the City
s total payroll
for the same period was $84,984,904.
Since the entitlement to benefits is based entirely upon the allocation of monies received by the plan to the participants'
share accounts, there is no actuarial liability on the part of either the State or the City.
3. Firefighters Supplemental Pension Fund
A supplemental defined contribution pension plan exists for all eligible firemen, which is funded by earmarked revenues
received from the State and is administered by the Board of the Clearwater Firefighters Supplemental Pension Plan. The
revenues received from the State are allocated among eligible firemen on the basis of days worked during the previous
year. These revenues, which comprise the plan contributions, amounted to $905,872 in the year ended September 30,
2006, and are obtained from a one and eighty-five one hundredths percent (1.85%) excise tax on the gross receipts from
premiums collected on property insurance policies covering property within the City's corporate limits. The contributions
represent 7.77% of current year covered payroll. The fair value of investments at September 30, 2006, totaled $7,925,897.
As the plan is described as a money purchase pension plan, whereby contributions are allocated based on the number
of days worked during the fiscal year ended September 30, and interest earnings allocated based on the beginning
balances in each participant's account, there is no actuarial liability on the part of the State or City.
The Firefighters Supplemental Pension Fund is authorized by and operates under the provisions of Sections 2.441
through 2.450 of the Municipal Code of the City of Clearwater and Chapter 175 of Florida Statutes. Eligibility requires
two years of credited calendar year service as a firefighter with concurrent participation in the Employees' Pension Plan.
There is no employee contribution to the supplemental plan, and benefits are vested for a lump sum distribution at ten
years unless there is early retirement, disability or death. Non-vested participants' account values upon termination of
employment are reallocated among the remaining participants on the basis of days worked during the previous year.
For the fiscal year ended September 30, 2006, the covered payroll was $11,656,068; the City's total payroll for the
same period was $84,984,904.
70
City of Clearwater, Florida
Notes to the Basic Financial Statements
For the Year Ended September 30, 2006
4. Pension Plan Financial Statements
Separate financial statements are provided in the Notes per the guidance of GASB Statement No. 34 as follows:
Statement of Fiduciary Net Assets:
ASSETS
Cash on hand and in banks $
Equity in pooled cash and investments
Managed investment accounts, at fair value:
Cash and cash equivalents
Government bonds
Agency bonds
Domestic corporate bonds
Domestic stocks
Mortgage backed bonds
Domestic equity mutual fund
International equity mutual fund
Fixed income mutual fund
Total managed investment accounts
Securities lending collateral
Receivables:
Interest and dividends
Unsettled investment sales
Securities lending earnings
Due from others
Total receivables
Total assets
LIABILITIES
Accounts payable
Unsettled investment purchases
Obligations under securities lending
Total liabilities
Defined Benefit Defined Contribution
Pension Trust Funds Pension Trust Funds
Police Firefighters
Employees' Firemen's Supplemental Supplemental
- $ - $ 16,194 $ -
1,221,515 2,217,556 - -
10,701,781 - 149,362 825,586
56,809,304 - 3,880,851 605,134
6,681,307 4,800,783 685,991 164,236
51,136,791 - 164,091 937,077
222,410,983 - 7,762,735 4,433,511
84,286,886 - 65,304 751,620
61,108,737 - - -
61,002,944 - - -
17,836,484 - -
571,975,217 4,800,783 12,708,334 7,717,164
129,445,306
1,831,941 33,755 69,083 26,928
38,237,710 - - -
7,886 -
49,060 - - 181,805
40,126,597 33,755 69,083 208,733
742,768,635 7,052,094 12,793,611 7,925,897
658,973 - -
54,511,722 -
129,445,306 -
184,616,001 - -
NET ASSETS
Net assets held in trust for pension benefits $ 558,152,634 $ 7,052,094 $ 12,793,611 $ 7,925,897
71
City of Clearwater, Florida
Notes to the Basic Financial Statements
For the Year Ended September 30, 2006
Statement of Changes in Fiduciary Net Assets:
Defined Benefit
Pension Trust Funds
ADDITIONS
Contributions:
Contributions from employer
Contributions from employees
Other contributions
Total contributions
Investment income:
Net appreciation (depreciation) in
fair value of investments
Interest
Dividends
Less investment expenses:
Investment management / custodian fees
Net income from investing activities
Securities lending income:
Gross earnings
Rebate paid
Bank fee
Net income from securities lending
Total additions
DEDUCTIONS
Benefits and withdrawal payments:
Benefits
Withdrawal payments
Total benefits and withdrawal payments
Income (loss) before administrative expenses
Administrative expenses
Net increase (decrease)
Net assets held in trust for pension benefits:
Beginning of year
End of year
5. 401(a) defined contribution plan
Defined Contribution
Pension Trust Funds
1
Police Firefighters
Employees' Firemen's Supplemental Supplemental
$ 7,417,042 $ 1,397,390 $ $
5,953,763 - - _
7,000 - 977,412 905,872
13,377,805 1,397,390 977,412 905,872
37,099,101 18,926 963,317 530,479 1
8,768,280 364,641 211,870 148,561
2,454,269 - 147,785 42,983
48,321,650 383,567 1,322,972 722,023
2,739,421 - 71,358 93,519
45,582,229 383,567 1,251,614 628,504
5,292,439 - - _
(4,988,885)
(107,606)
195,948 -
59,155,982 1,780,957 2,229,026 1,534,376
18,697,881 927,126 1,035,808 1,933,162
949,286 - - _
19,647,167 927,126 1,035,808 1,933,162
39,508,815 853,831 1,193,218 (398,786)
196,077 3,950 67,271 33,885
39,312,738 849,881 1,125,947 (432,671)
518,839,896 6,202,213 11,667,664 8,358,568
$ 558,152,634 $ 7,052,094 $ 12,793,611 $ 7,925,897
For all management employees not covered under either of the defined benefit pension plans, the City provides pension
benefits through a 401(a) defined contribution plan. In a defined contribution plan, benefits depend solely on amounts
contributed to the plan plus investment earnings. Employees are participants from the date of employment and are fully
vested upon enrollment. The plan is totally contributory on the part of the City in an amount equal to 15% of
compensation on behalf of the City Manager and the City Attorney; 14% of compensation on behalf of the Chief of
Police; and 8% of compensation on behalf of all other management contract employees and Assistant City Attorneys.
The City makes bi-weekly contributions to the Trust throughout the plan year to meet its funding obligations under the
plan.
L V- I
1
72
City of Clearwater Florida
Notes to the Basic Financial Statements
For the Year Ended September 30, 2006
The International City Management Association Retirement Corporation (ICMA-RC), the trustee for the defined annuity,
offers participants a variety of investment options.
The City's total payroll for the fiscal year ended September 30, 2006, was $84,984,904. The Plan members' payroll for
the same period totaled $5,562,090. The City's contribution, per the above contribution rates, totaled $471,720. The
assets of the trust, at market value, totaled $3,241,182 at September 30, 2006.
6. Deferred compensation plan
The City offers its employees a deferred compensation plan created in accordance with Internal Revenue Code Section
457. The plan, available to all City employees, permits them to defer a portion of their salary until future years. Participation
in the plan is optional. The deferred compensation is not available to employees until termination, retirement, death, or
unforeseeable emergency.
Effective January 1, 1997, Federal legislation converted the Section 457 deferred compensation assets from City assets to
employee assets. As a result of these changes, plan assets are no longer subject to the claims of the City's general
creditors.
The City has previously reported the assets and associated liabilities of the deferred compensation plan in the City's
financial statements as an agency fund. Effective with the change in legislation these assets are no longer City assets and
the fiduciary responsibility has been transferred to the third parry plan administrator. Consequently, effective with fiscal
1997, these assets are no longer reported in the accompanying financial statements, in compliance with Governmental
Accounting Standards Board Statement No. 32.
F. Securities lending transactions
The City of Clearwater Employees' Pension Plan participates in securities lending transactions via a Securities Lending
Authorization Agreement with Northern Trust Company, who is also the pension plan's custodian. Securities are loaned
versus collateral that may include cash, U.S government securities, and irrevocable letters of credit. U.S. government
securities are loaned versus collateral at 102% of the market value of the securities plus any accrued interest. Non-U.S.
securities are loaned versus collateral at 105% of the market value plus any accrued interest.
Non-cash collateral cannot be pledged or sold unless the borrower defaults. All securities loans can be terminated on
demand by either the lender or the borrower. The average term for the pension plans loans at September 30, 2006 was 58
days.
Cash "open" collateral is invested in a short term investment pool, the Core USA Collateral Section, which had an average
weighted maturity of 42 days as of September 30, 2006. Cash collateral may also be invested separately in "term loans" in
which investments match the loan term. These term loans may be terminated on demand by either the lender or the
borrower.
There were no significant violations of legal or contractual provisions, nor any borrower or lending agent defaults known to
the securities lending agent. The City did not impose any restrictions on the amount of loans made by Northern Trust
r during fiscal year 2006.
Northern Trust has indemnified the City for losses attributable to violations by the entity of the Standard of Care set out in
the Agreement. Northern Trust has also indemnified the City for all losses as a result of borrower default and for any losses
resulting from insufficient collateral. There were no losses during fiscal year 2006.
As of September 30, 2006, the City had no credit risk exposure to borrowers. The following is a summary of securities on
' loan and their collateral:
73
City of Clearwater, Florida
Notes to the Basic Financial Statements
For the Year Ended September 30, 2006
Securities Collateralized by Cash Securities Collateralized by Non-Cash
Security Type Fair Value Cash Collateral Fair Value Non-Cash Collateral
U.S. Corporate Fixed $ 5,499,440 $ 5,637,290 $ 468,807 $ 479,482
U.S. Equity 58,158,224 59,744,419 2,550,218 2,620,090
U.S. Government Fixed 58,556,708 59,961,887 - -
U.S. Agencies 4,003,286 4,101,710 - -
Total $ 126,217,658 $ 129,445,306 $ 3,019,025 $ 3,099,572
G. Contingencies and commitments
Loan Guarantee - PACT. Inc.
PACT, Inc. is a nonprofit corporation formed in 1978, for the purpose of financing, constructing, and operating a
performing arts center. Per a Guaranty Agreement dated May 18, 2001, the City guaranteed $1,000,0000 on a
$5,000,000 mortgage note for PACT, Inc., used to refinance a previous mortgage with a similar City guarantee. City
management does not consider it probable that this guarantee will be called, and, accordingly, no amounts have yet
been accrued or otherwise recorded in the accompanying financial statements to reflect this possibility.
Loan Guarantee - Chi Chi Rodriquez Youth Foundation. Inc.
On March 30, 1992, the City Council approved a contingent loan guarantee of $1,000,000 on a $2,500,000 note for the
Chi Chi Rodriquez Youth Foundation, Inc. The proceeds of the note were used to refinance existing foundation debt
incurred to construct a golf course on a parcel of City-owned land. Subsequently, the note was refinanced with Variable
Rate Demand Revenue Bonds (Chi Chi Rodriquez Youth Foundation Project), Series 1998, on August 1, 1998. In the
event of default, the City is obligated to contribute $1,000,000 out of legally available non-ad valorem revenues. In
addition, the City has the option to retire the entire unpaid balance and assume ownership and operation of the golf
course facility.
Soil and groundwater contamination site
The City owns a property, currently used by the City Gas Division as its administrative offices and operating facility, that
has been identified as having soil and groundwater impacts in a June 1990 report prepared by a United States
Environmental Protection Agency contractor. The contamination allegedly resulted from the prior operation of a
manufactured gas plant (MGP). Contamination assessment activities by the City were initiated during 1995 and a draft
Contamination Assessment Report was submitted to the Florida Department of Environmental Protection (FDEP) on
December 29,1999. On March 20, 2000, FDEP requested further assessment be undertaken. On July 25, 2000, FDEP
approved the City's proposed scope of work for additional on and off-site assessment activities. Additional field activities
were initiated in December 2000. The supplemental contamination assessment results were submitted to FDEP as part
of the May 2001 and July 2001 site status reports. The cost of this additional work, including preparation and submittal
of the May and July 2001 site status reports, was approximately $39,462.
On May 16, 2002, the City received a letter from FDEP requiring additional fieldwork to better define the soil and
groundwater contamination on the site. In September 2002, Clearwater Gas met with FDEP to discuss their May 16'h
letter and the future of the gas plant site. In that meeting, it was agreed the City would install seven (7) new monitoring
wells and drill twelve (12) soil samples around the perimeter of the MGP site. This additional work was performed in
early 2003 and the results were submitted to FDEP in June 2003. In August 2003, FDEP conducted a Hazard Ranking
System (HRS) score report for the Clearwater MGP site. The results of the HRS report were then forwarded to the
Environmental Protection Agency (EPA) for possible listing as a superfund site. Since this time no further assessments
have been conducted under the direction of FDEP.
During fiscal 2005, the Myrtle Avenue Utility and Roadway Widening project began, requiring extensive dewatering
during construction. Consulting, equipment, laboratory, permitting, and labor costs for dewatering in areas where there
was suspected or known contamination from the former MGP plant were charged to the City of Clearwater Gas
Division.
74
City of Clearwater, Florida
Notes to the Basic Financial Statements
For the Year Ended September 30, 2006
Since 1993, the City has spent $674,234 on the MGP assessment activities, which includes both environmental
consultant and outside attorney fees. Approximately $487,500 has been recovered from City insurance policies to be
applied to any required remediation.
Contractual Commitment - Water and Sewer Utility
Under the terms of a 30-year contract between the City and Pinellas County, which is effective through September 30,
2035, the maximum amount of water available to the City is 15 million gallons per day on an annual average basis with
no minimum quantity purchase requirement. Effective October 1, 1995, the rate, which is set by the Pinellas County
Board of County Commissioners (BOCC), was $1.7902 per 1,000 gallons, including a $.60 per 1,000 gallon surcharge
for funding capital projects. On November 19, 2002, the BOCC approved the following rate increases: $1.9334 effective
January 1, 2003; $2.0881 effective October 1, 2003; $2.2969 effective October 1, 2004; $2.5266 effective October 1,
2005; $2.7792 effective October 1, 2006; and $2.97 effective October 1, 2007. The cost of water purchased from the
County during fiscal years 2005 and 2006 was $6,329,627 and $8,827,121, respectively.
Contractual Commitment - Parking System
Under the terms of a development agreement, the City has committed to repurchase a beach land parcel at the
appraised amount not to exceed $6,000,000, if the developer is unable to proceed with the development project by
December 2006. Parking System Fund assets in the amount of $6,000,000 have been restricted for this purpose.
Grant Revenues
During the current fiscal year and prior fiscal years, the City received revenues and contributions related to grants from the
Southwest Water Management District, the State of Florida, the federal government, and other grantors. These grants are
for specific purposes and are subject to review and audit by the grantor agencies. Such audits could result in requests for
reimbursement for expenditures disallowed under the terms of the grants. Based upon prior experience, City management
believes such disallowances, if any, will not be significant.
H. Pending litigation
In the normal course of operations the City is a defendant in various legal actions, the ultimate resolution of which is not
expected to have a material effect on the financial statements, other than for amounts that have been reserved and
recorded as liabilities in the Central Insurance Fund.
1. Conduit debt
The City has one issue of conduit debt outstanding as follows:
Original Amount Amount
Issue Outstanding Outstanding
Description / Puu Am ul?l at at
Drew Gardens Refunding Bonds / residential rental facility $ 3,425,000 $ 2,865,000 $ 2,795,000
' The bonds do not constitute a debt, liability, or obligation of the City of Clearwater, the State of Florida, or any political
subdivision thereof and accordingly have not been reported in the accompanying financial statements.
75
1
City of Clearwater, Florida
Notes to the Basic Financial Statements
For the Year Ended September 30, 2006
J. Jointly governed organization
Related Organization - The City of Clearwater is a member of the Florida Gas Utility (FGU), a non-profit municipal ,
public entity created for the sole purpose of reducing the costs of purchased gas for its members. FGU is a public body
corporate and politic pursuant to Section 163.01 Florida Statutes (the Florida Interlocal Cooperation Act), as amended,
and the Interlocal Agreement, dated September 1, 1989, which was subsequently amended by the Amended Interlocal
Agreement on June 1, 1992, amended and restated by the Amended and Restated Interlocal Agreement, dated July 1,
1996, and thereafter amended and restated by the Second Amended and Restated Interlocal Agreement, dated July 27,
1999, (the Interlocal Agreement), executed and delivered among FGU and its members, which include municipalities,
municipal utilities, and an interlocal agreement consisting of such entities. Due to the diverse needs of municipal utility
systems, FGU established itself as a project-oriented agency. Under this structure, each member has the option
whether or not to participate in a project. FGU has the authority to, among other things, plan, finance, acquire,
construct, manage, operate, deliver, service, utilize, own, broker, exchange, and distribute natural gas, or other energy
and energy services, pursuant to the Interlocal Agreement. As of September 30, 2006, FGU has 23 members. Separate
audited financial statements of FGU as of September 30, 2006, are available from FGU.
K. Related organization
Related Organization - The City of Clearwater serves as administrative agent for the Clearwater Downtown
Development Board (DDB). The Downtown Development Board is an independent special district of the City of
Clearwater with an independent board elected by its members and, with its own one mill levy on downtown properties,
is not financially dependent upon the City. Consequently it is not a component unit of the City of Clearwater and the
DDS's cash balance held by the City as administrative agent is reflected in the City's fiduciary agency fund. Separate
audited financial statements of the DDB as of September 30, 2006, are available from the DDB.
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Required Supplementary Information
Pension Trust Funds
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Page 1 of 3
City of Clearwater, Florida
Defined Benefit Pension Plans
Required Supplementary Information - Unaudited
Schedules of Funding Progress: ,
Actuarial Actuarial Actuarial Unfunded AAL
Valuation Value of Accrued Liability Unfunded Funded Covered as a Percentage
Date Assets (AAL) - Entry Age AAL Ratio Payroll of Covered Payroll
(a) (b) (b-a) (a/b) (c) a
/
)
c)
1/1/2001 $ 461,724,610 $ 535,672,208 $ 73,947,598 86% $ 54,864,584 135%
1/1/2002 $ 491,859,015 $ 533,191,487 $ 41,332,472 92% $ 58,929,582 70%
1/1/2003 $ 477,541,459 $ 517,933,495 $ 40,392,036 92% $ 65,150,820 62%
1/1/2004 $ 507,256,663 $ 546,915,627 $ 39,658,964 93% $ 69,907,473 57%
1/1/2005 $ 510,265,274 $ - 549,136,184 $ 38,870,910 93% $ 73,836,304 53%
1/1/2006 $ 525,573,824 $ 563,597,580 $ 38,023,756 93% $ 76,010,269 50%
Actuarial Actuarial Actuarial Unfunded AAL
Valuation Value of Accrued Liability Unfunded Funded Covered as a Percentage
Date Assets (AAL) - Entry Age AAL Ratio Payroll of Covered Payroll
(a) (b) (b-a) a/b (c) ((b-a) /c)
1/1/2001 $ 4,668,572 $ 9,527,303 $ 4,858,731 49% $ - n/a
1/1/2002 $ 5,213,993 $ 8,907,427 $ 3,693,434 59% $ - n/a
1/1/2003 $ 5,741,450 $ 10,483,967 $ 4,742,517 55% $ - n/a
1/1/2004 $ 6,190,744 $ 9,974,824 $ 3,784,080 62% $ - n/a
1/1/2005 $ 6,744,043 $ 8,938,022 $ 2,193,979 75% $ - n/a
1/1/2006 $ 7,445,172 $ 8,773,238 $ 1,328,066 85% $ - n/a
Covered payroll is for the calendar year period used for the actuarial valuation.
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City of Clearwater, Florida
Defined Benefit Pension Plans
Required Supplementary Information - Unaudited
Page 2 of 3
I
Schedules of Emp
loyer Contributions:
I Employees' Pension Fund
Year Annual (a)
Ended Required Percent
Sept. 30, Contribution Contributed
2001 $ 174,377 2440%
1
2002 $ n/a
2003 $ - n/a
2004 $ 4,156,253 116%
2005 $ 5,415,848 95% (b)
2006 $ 11,614,495 64% (b)
(a) The actuarially determined contribution requirements for the City's fiscal year ended September 30, 2006, are
based on actuarial valuations as of January 1, 2005. Since the City's contributions are made during its fiscal year,
which commences nine months after the date of the actuarial valuations, the City, with approval of State regulatory
authorities, is following the practice of adding interest to its required contributions at the assumed rate of return on
investments for a period of one year.
(b) The actual contribution is less than the annual required contribution due to a "drawdown" of the net pension asset.
Firemen's Relief Pension Fund
Year
Ended
Sept. 30,
2001
2002
2003
2004
2005
2006
Annual (a)
Required Percent
Contribution Contributed
$ 1,098,990 100%
$ 1,153,732 100%
$ 1,211,210 100%
$ 1,264,729 101%
$ 1,331,045 100%
$ 1,397,390 100%
(a) The actuarially determined contribution requirements for the City's fiscal year ended September 30, 2006, are
based on actuarial valuations as of January 1, 2005. Since the City's contributions are made during its fiscal year,
which commences nine months after the date of the actuarial valuations, the City, with approval of State regulatory
authorities, is following the practice of adding interest to its required contributions at the assumed rate of return on
investments for a period of nine months.
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Page 3 of 3
City of Clearwater, Florida
Defined Benefit Pension Plans
Required Supplementary Information - Unaudited
Notes To Schedules Of Required Pension Supplementary Information
Annual required contributions for the Employees' Pension Fund are calculated using the Entry Age Normal with Frozen Initial Liability
method. The initial unfunded actuarial accrued liability determined at July 1, 1963 is being amortized over a 40-year period; changes
made in 1979 and subsequent years which have had the effect of either increasing or decreasing the actuarial liability are being amortized
over a 30-year period from their effective dates in accordance with State law. The amortization method is level dollar closed.
Annual required contributions for the Firemen's Relief and Pension Fund are based on the aggregate actuarial cost method, under which
the unfunded portion of the present value of the projected benefits is allocated over the present value of a 6.0% per year increasing
annuity for the remaining years in the 35-year funding period which begin January 1, 1972, pursuant to an agreement between the City
and the Plan participants. For this purpose, the unfunded actuarial liability is determined after consideration of the available assets at the
valuation date. The increasing fixed schedule produced by this method was established in 1988 and will be modified in the future only to
the extent that a current valuation indicates a higher required cost level, or if the resulting cost level exceeds 60% of a mill in a current
year. The amortization method for the Firemen's Relief and Pension Fund is a non-standard (no active employees) closed cost method.
The actuarially determined contribution requirements for the Citys fiscal year ended September 30, 2006, are based on actuarial
valuations as of January 1, 2005. Since the City's contributions are made during its fiscal year, which commences nine months after the
date of the actuarial valuations, the City, with approval of State regulatory authorities, is following the practice of adding interest to its
required contributions at the assumed rate of return on investments for a period of one year in the case of the Employees' Pension Fund
and for nine months in the case of the Firemen's Relief and Pension Fund.
Significant actuarial assumptions utilized in the actuarial valuations as of January 1, 2005, in the determination of the annual required
contribution are as follows:
Employees' Pension Fund
(1) Assumed rate of return on investments of 7.5% per annum.
(2) Projected salary increase at a rate of 6% per year, including cost-of-living adjustments of 3% and merit or seniority increases at 3%.
(3) Mortality based on the 1994 Group Annuity Reserving Table for Males with female ages set back five years.
(4) Pre-retirement withdrawals assumed to occur in accordance with a table of declining withdrawal rates for male, female, and
hazardous duty categories.
(5) Pre-retirement incidence of disability assumed to occur in accordance with a standard scale of moderate disability rates (Class 1,
1952 Inter-Company); rates for females assumed to be twice that for males.
(6) Assumed inflation rate of 3%
Firemen's Relief and Pension Fund
(1) Assumed rate of return on investments of 4.5% compounded annually.
(2) Assumed benefits grow at annually compounded rate of 2% related to cost of living adjustments only.
(3) Mortality based on the 1994 Unisex Mortality Table projected to 2010 for both active and retired participants.
(4) Assumed no withdrawals will occur.
(5) Assumed probability of an active participant becoming disabled is zero (no active participants).
(6) Assumed value of one mill of ad valorem tax will increase at rate of 5% per year.
(7) Assumed inflation rate of 3%
Significant changes affecting the presented 6-year trend information include:
The actuarial valuation of the Employees' Pension Fund as of January 1, 2002, reflected several changes in actuarial assumptions, as
follows: An investment yield of 7.5% assumed whereas the prior valuation assumed 7.0%. Salaries were projected to increase at 6%
versus the prior valuation assumption of 5%. Employee turnover rates were revised for male and female employees and separate rates
were adopted for hazardous duty employees. The mortality table was changed from the 1983 Group Annuity Mortality Table to the 1994
Group Annuity Reserving Table. And finally, the retirement age assumption was changed from 100%o retirement at first eligibility for
unreduced benefits to a table of decrements at different ages. The impact of these changes decreased the unfunded actuarial accrued
liability from $72,178,974 to $41,332,472.
The actuarial valuation of the Firemen's Relief and Pension Fund as of January 1, 2003, reflected two changes in actuarial
assumptions. The report assumes an investment yield of 4.5% versus the prior valuation assumption of 5.5%. Also, the current
mortality pattern assumption uses the 1994 Unisex Morality Table versus the 1983 Group Annuity Mortality Table used for previous
valuations. The impact of these changes increased the unfunded actuarial accrued liability from $2,648,428 to $4,742,517.
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Nonmajor Governmental Funds
Special Revenue Funds
Special revenue funds are used to account for specific revenues that are legally restricted to expenditures for
particular purposes.
Special Programs Fund - to account for grants and contributions, the use of which is restricted for certain
programs.
Community Redevelopment Agency Fund - to account for receipt, custody, and expenditure of property tax
increment funds associated with related redevelopment projects.
Local Housing Assistance SHIP Trust Fund - to account for monies allocated to the City under the Local
Housing Assistance SHIP grant program.
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Debt Service Funds
Debt service funds provide separate accounting records for all debt interest, principal, and reserve
requirements for general government long-term. Debt of proprietary funds is serviced through restricted
accounts maintained within the individual enterprise or internal service fund associated with the debt.
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Improvement Revenue Refunding Bonds Debt Service Fund - to account for the advance monthly
accumulation of resources by transfer of public service tax and communications services tax revenues
from the General Fund and the payment of currently maturing installments of principal and interest during
I each fiscal year.
Infrastructure Sales Tax Revenue Bonds Debt Service Fund - to account for the advance monthly
accumulation of resources by transfer of sales tax revenues from the Special Development Special
Revenue Fund and the payment of currently maturing installments of principal and interest during each
1
fiscal year.
Notes and Mortgages Debt Service Fund - to account for the advance monthly accumulation of resources by
transfer of General Revenues from the General and Special Revenue Funds and the payment of currently
maturing installments of principal and interest on the various note and mortgage obligations of the
governmental funds during each fiscal year.
I
Spring Training Facility Revenue Bonds Debt Service Fund - to account for the advance monthly
accumulation of resources by transfer of sales tax revenues from the Special Development Special Revenue
Fund and the payment of currently maturing installments of principal and interest during each fiscal year.
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ASSETS
Cash on hand and in banks
Equity in pooled cash and investments
Receivables:
Mortgage notes
Rehab advances
Other
Investments
Due from other governments - grants
Land held for resale
Advances to other funds
Total assets
LIABILITIES
Accounts and contracts payable
Accrued payroll
Due to other governmental entities
Construction escrows
Due to other funds
Advances from other funds
Deferred revenue
Total liabilities
FUND BALANCES
Reserved for:
Advances and notes
Grant programs
Land held for resale
Debt service:
Current requirements - principal
Current requirements - interest
Future requirements
Unreserved, reported in:
Special revenue funds
Debt service funds
Total fund balances
Total liabilities and fund balances
City of Clearwater, Florida
Combining Balance Sheet
Nonmajor Governmental Funds
September 30, 2006
Special Revenue Funds
Local Housing
Community Assistance
Special Redevelopment SHIP
Programs Agency Trust Total
$ - $ 100 $ - $ 100
9,694,326 518,472 800,597 11,013,395
4,456,641 - 6,787,136 11,243,777
20,342 - 4,689 25,031
8,962 62,786 - 71,748
204
4
,
58 - - 204,458
84,701 1,914,050 - 1,998,751
350,000 - - 350,000
$ 14,819,430 $ 2,495,408 $
7,592,422 $
24,907,260 '
$ 117,448 $ 171 $ $ 117,619
28,559 - - 28,559
705 48,000 - 48,705
168,327 - 123,520 291,847
- 120,401 - 120,401
- 350,000 350,000
958 62,786 - 63
744
315,997 581,358 123,520 ,
1,020,875
4,806,641 - 6,787,136 11,593,777
5,447,192 - - 5,447,192
84,701 1,914,050 - 1,998,751
4,164,899 - 681,766 4,846,665
14,503,433 1,914,050 7,468,902 23,886,385
$ 14,819,430 $ 2,495,408 $ 7,592,422 $ 24,907,260
The notes to the financial statements are an integral part of this statement.
84
Debt Service Funds
Spring
Improvement Infrastructure Training Total
Revenue Sales Tax Facility Nonmajor
Refunding Revenue Revenue Governmental
Bonds Bonds Bonds Total Funds
$ - $ - $ - $ - $ 100
287,224 5,233,462 26,545 5,547,231 16,560,626
- - - - 11,243,777
25,031
- - - - 71,748
864,964 - 372,998 1,237,962 1,237,962
- - - - 204,458
1,998,751
- - - - 350,000
$ 1,152,188 $ 5,233,462 $ 399,543 $ 6,785,193 $ 31,692,453
$ - $ - $ - $ - $ 117,619
28,559
48,705
291,847
120,401
350,000
63,744
1,020,875
- - - - 11,593,777
5,447,192
- - - - 1,998,751
213,333 4,895,833 285,833 5,394,999 5,394,999
77,855 337,629 49,755 465,239 465,239
861,000 - - 861,000 861,000
- - - - 4,846,665
- - 63,955 63,955 63,955
1,152,188 5,233,462 399,543 6,785,193 30,671,578
$ 1,152,188 $ 5,233,462 $ 399,543 $ 6,785,193 $ 31,692,453
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City of Clearwater, Florida
Combining Statement of Revenues, Expenditures, and Changes in Fund Balances
Nonmajor Governmental Funds
For the Year Ended September 30, 2006
REVENUES
Intergovernmental
Charges for services
Fines and forfeitures
Interest income
Miscellaneous
Total revenues:
EXPENDITURES
Current:
General government
Public safety
Physical environment
Economic environment
Human services
Culture and recreation
Debt service:
Principal
Interest & fiscal charges
Capital outlay
Total expenditures
Excess (deficiency) of revenues
over / (under) expenditures
OTHER FINANCING SOURCES (USES)
Transfers in
Transfers out
Sale of capital assets
Land donation from general government - for resale
Total other financing sources (uses)
Net change in fund balances
Fund balances - beginning
Fund balances - ending
Special Revenue Funds
Local Housing
Community Assistance
Special Redevelopment SHIP
Programs Agency Trust Total
$ 3,295,952 $ 898,896 $ 1,023,711 $ 5,218,559
1,928,151 - - 1,928,151
557,075 - - 557,075
361,385 115,719 49,224 526,328
407,000 61,820 - 468,820
6,549,563 1,076,435 1,072,935 8,698,933
183,276 - - 183,276
1,281,380 1,281,380
543,239 - - 543,239
1,310,686 247,366 185,935 1,743,987
122,599 - - 122,599
2,009,578 - 2,009,578
234,147 - - 234,147
5,684,905 247,366 185,935 6,118,206
864,658 829,069 887,000 2,580,727
2,381,599 1,174,988 - 3,556,587
(416,411) (2,034,015) (93,709) (2,544,135)
119,503 - 119,503
- 1,000,410 - 1,000,410
2,084,691 141,383 (93,709) 2,132,365
2,949,349 970,452 793,291 4,713,092
11,554,084 943,598 6,675,611 19,173,293
$ 14,503,433 $ 1,914,050 $ 7,468,902 $ 23,886,385
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The notes to the financial statements are an integral part of this statement.
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' Debt Service Funds
Spring
Improvement Infrastructure Training Total
Revenue Sales Tax Notes Facility Nonmajor
Refunding Revenue and Revenue Governmental
Bonds Bonds Mortgages Bonds Total Funds
$ $ - $ - $ 1,087,654 $ 1,087,654 $ 6,306,213
- - 1,928,151
- - - 557,075
52,338 264,971 19,648 336,957 863,285
- - - 468,820
52,338 264,971 - 1,107,302 1,424,611 10,123,544
183,276
- - - - - 1,281,380
- - - 543,239
1,743,987
- - - - -
122,599
- - - - 2,009,578
356,170 5,660,000 765,323 475,000 7,256,493 7,256,493
475,646 1,896,224 54,375 602,992 3,029,237 3,029,237
- - - - 234,147
831,816 7,556,224 819,698 1,077,992 10,285,730 16,403,936
(779,478) (7,291,253) (819,698) 29,310 (8,861,119) (6,280,392)
' 769
253 3
208
689 819
69
, ,
, ,
8 - 4,797,640 8,354,227
- - - - (2,544,135)
- - - - - 119,503
1,000,410
769,253 3,208,689 819,698 - 4,797,640 6,930,005
(10,225) (4,082,564) - 29,310 (4,063,479) 649,613
1,162,413 9,316,026 370,233 10,848,672 30,021,965
¦ $ 1,152,188 $ 51233,462 $ - $ 399,543 $ 6,785,193 $ 30,671,578
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City of Clearwater, Florida
Schedule of Revenues, Expenditures, and Changes in Fund Balances -
Budget and Actual (GAAP Basis)
Community Redevelopment Agency
For the Year Ended September 30, 2006
REVENUES
Intergovernmental
Interest income
Miscellaneous
Total revenues
EXPENDITURES
Current - Economic environment
Total expenditures
Excess of revenues over expenditures
OTHER FINANCING SOURCES (USES)
Capital grants and contributions
Transfers in
Transfers out
Land donation from General Government - for resale
Total other financing sources (uses)
Excess (Deficiency) of revenues and other sources
over expenditures and other uses
970,452 970,452
Fund balances - beginning 943,598 943,598 943,598 -
Fund balances - ending $ 943,598 $ 943,598 $ 1,914,050 $ 970,452
Variance with
Budgeted Amounts Final Budget
Actual Positive
Original Final Amounts (Negative)
$ 903,594 $ 898,895 $ 898,896 $ 1
15,000 15,000 115,719 100,719
58,947 58,947 61,820 2,873
977,541 972,842 1,076,435 103,593
386,770 385,986 247,366 138,620
386,770 385,986 247,366 138,620
590,771 586,856 829,069 242,213
738,555 1,084,887 1,174,988 90,101
(1,329,326) (1,671,743) (2,034,015) (362,272)
- - 1,000,410 1,000,410
(590,771) (586,856) 141,383 728,239
The notes to the financial statements are an integral part of this statement.
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Nonmajor Enterprise Funds
Enterprise funds are used to account for the financing, acquisition, operation, and maintenance of
governmental facilities that are supported primarily by user charges.
Recycling Utility Fund - to account for the financing, processing, operation and maintenance of the City's
recycling service from charges made to users of the services and funds received from the sale of recyclable
commodities processed to meet market requirements. The service area extends beyond the City limits
Marine & Aviation Fund - to account for the financing, operation and maintenance of the City marina and
associated real property on Clearwater Beach from rents collected from users; and to account for the City's
airpark operations.
Parking System Fund - to account for the financing, construction, operation and maintenance of the City's
parking system, including on- and off-street parking on Clearwater Beach and Downtown Clearwater, from
' parking charges.
Harborview Center Fund - to account for the operation of the City's convention center and related facilities.
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City of Clearwater, Florida
Combining Statement of Net Assets
Nonmajor Enterprise Funds
September 30, 2006
ASSETS
Current assets:
Cash on hand and in banks
Equity in pooled cash and investments
Accounts and contracts receivable:
Billed
Unbilled charges estimated
Less: Allowance for uncollectable accounts
Total receivables, net
Other receivables
Due from other governmental entities
Inventories, at cost
Prepaid expenses and other assets
Total current assets
Noncurrent assets:
Restricted equity in pooled cash
Net pension asset
Capital assets:
Land and other nondepreciable assets
Capital assets, net of accumulated depreciation
Total noncurrent assets
Total assets
LIABILITIES
Current liabilities:
Accounts and contracts payable
Accrued payroll
Deposits
Unearned revenue and liens
Current portion of long-term liabilities:
Compensated absences
Notes, loan pool agreement and acquisition contracts
Total current liabilities
Noncurrent liabilities:
Compensated absences
Notes, loan pool agreement and acquisition contracts
Advances from other funds
Total non-current liabilities
Total liabilities
Net assets:
Invested in capital assets, net of related debt
Restricted for:
Parking improvements
Unrestricted
Total net assets
Recycling Marine & Parking Harborview
Utility Aviation System Center Total
$ - $ 1,200 $ 19,500 $ 497,714 $ 518,414
3,702,378 101,729 8,168,224 176,300 12,148,631
72,313 - - 38,613 110,926
159,914 - - 159,914
232,227 - - 38,613 270,840
(11909) - - - (1,909)
230,318 - 38,613 268,931
- - 25 - 25
52,187 - 52,187
33,301 15,623 48,924
- - - 25,341 25,341
3,932,696 188,417 8,187,749 753,591 13,062,453
- - 7,500,000 - 7,500,000
202,868 129,155 113,522 - 445,545
- 2,080,986 883,612 926,000 3,890,598
1,071,175 2,960,459 2,310,029 7,658,756 14,000,419
1,274,043 5,170,600 10,807,163 8,584,756 25,836,562
5,206,739 5,359,017 18,994,912 9,338,347 38,899,015
1
23,163 9,361 6,217 348,974 387,715
26,576 29,054 37,899 - 93,529
- 20,739 2,853 208,812 232,404
- - 9,931 - 9,931
3,603 9,484 5,980 19,067
121,495
-
103,391 '
- 224,886
174,837 68,638 166,271 557,786 967,532
34,105 89,759 56,595 180,459
233,149 - 78,027 - 311,176
- - 4,000,000 4,000,000
267,254 89,759 4,1349622 - 4,491,635
442,091 158,397 4,300,893 557,786 5,459,167
716,531 5,041,445 3,012,224 8,584,756 17,354,956
- - 3,500,000 - 3,500,000
4,048,117 159,175 8,181,795 195,805 12,584,892
$ 4,764,648 $ 5,200,620 $ 14,694,019 $ 8,780,561 $ 33,439,848
The notes to the financial statements are an integral part of this statement.
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City of Clearwater, Florida
' Combining Statement of Revenues, Expenses, and Changes in Fund Net Assets
Nonmajor Enterprise Funds
For the Year Ended September 30, 2006
I Recycling Marine & Parking Harborview
Utility Aviation System Center Totals
Operating revenues:
' Sales to customers $ 1,243,574 $ 2,662,168 $ $ $ 3,905,742
Service charges to customers
6,835 -
6,835
User charges to customers 1,489,615 81,559 4,851,508 - 6,422,682
' Rentals - 1,410,374 123,788 1,831,999 3,366,161
Total operating revenues 2,740,024 4,154,101 4,975,296 1,831,999 13,701,420
Operating expenses:
' Personal services 967,189 1,052,761 1,242,740 - 3,262,690
Purchases for resale 367,678 2,362,056 528,038 3,257,772
Operating materials and supplies 113,845 136,995 136,384 111,467 498,691
Transportation 314,840 15,021 70,967 67 400,895
Utility service 10,225 191,337 57,947 147,791 407,300
Depreciation 290,349 377,666 230,938 552,744 1,451,697
Interfund administrative charges 448,660 217,270 824,990 10,420 1,501,340
' Other current charges:
Professional fees 7,500 150,888 964,859 1,022,715 2,145,962
Advertising 14,793 13,783 761 25,119 54,456
Communications 7,558 29,504 23,315 16,371 76,748
Printing and binding 9,584 905 10,489
Insurance 44,040 53,790 44,180 26,549 168,559
Repairs and maintenance 22,408 87,760 26,276 78,653 215,097
Rentals 1,600 1,901 163,492 10,664 177,657
Miscellaneous 9,668 78,028 194 9,200 97,090
Data processing charges 23,830 31,540 36,990 49,725 142,085
Taxes 28,852 28,852
Provision for estimated uncollectable accounts 1,419 - - 1,419
Total other current charges 132,816 447,194 1,269,651 1,268,753 3,118,414
Total operating expenses 2,645,602 4,800,300 3,833,617 2,619,280 13,898,799
Operating income (loss) 94,422 (646,199) 1,141,679 (787,281) (197,379)
Nonoperating revenues (expenses):
Earnings on investments 143,193 16,567 551,852 19,225 730,837
Interest expense (12,650) (173,899) (186,549)
Amortization of bond issue costs - - (360) (360)
Gain (loss) on exchange of assets (3,783) - - - (3,783)
Other 59,429 133,795 6,039 9,891 209,154
Total nonoperating revenue (expenses) 186,189 150,362 383,632 29,116 749,299
Income (loss) before transfers 280,611 (495,837) 1,525,311 (758,165) 551,920
Capital grants and contributions - 2,409,021 - - 2,409,021
Transfers in 1,481 - 323,770 325,251
Transfers out (155,958) (319,529) (302,842) - (778,329)
' Changes in net assets 124,653 1,595,136 1,222,469 (434,395) 2,507,863
Total net assets - beginning 4,639,995 3,605,484 13,471,550 9,214,956 30,931,985
' Total net assets - ending $ 4,764,648 $ 5,200,620 $ 14,694,019 $ 8,780,561 $ 33,439,848
I The notes to the financial statements are an integral part of this statement.
93
City of Clearwater, Florida ,
Combining Statement of Cash Flows
Nonmajor Enterprise Funds
For the Year Ended September 30, 2006
Recycling Marine & Parking Harborview
Utility Aviation System Center Totals
CASH FLOWS FROM OPERATING
ACTIVITIES
Cash received from customers
Cash payments to suppliers
Cash payments to employees
Cash payments to other funds
Other revenues
Net cash provided (used) by operating activities
CASH FLOWS FROM NONCAPITAL
FINANCING ACTIVITIES
Transfers in from other funds
Transfers out to other funds
Grant revenue
Net cash provided (used) by
noncapital financing activities
CASH FLOWS FROM CAPITAL AND
RELATED FINANCING ACTIVITIES
Principal payments on debt
Interest paid
Acquisition of capital assets
Proceeds from issuance of debt
Capital contributed by other governmental entities
Net cash used by capital and
related financing activities
CASH FLOWS FROM INVESTING
ACTIVITIES
Interest on investments
Net cash provided by investing activities
Net increase (decrease) in cash and cash equivalents
Cash and cash equivalents at beginning of year
Cash and cash equivalents at end of year
Cash and cash equivalents classified as:
$ 2,732,415 $ 4,154,057 $ 5,017,266 $ 1,877,715 $ 13,781,453
(580,834)
(3,206,031)
(1,373,211)
(2,000,286)
(71160,362) ,
(926,610) (1,000,796) (1,193,024) (3,120,430)
(815,098) (129,855) (988,682) (18,202) (1,951,837)
133,795 6,039 9,891 149,725 '
409,873 (48,830) 1,468,388 (130,882) 1,698,549
'
- 1,481 - 323,770 325,251
(155,958) (319,529) (302,842) - (778,329)
59,429 - 59,429
'
(96,529) (318,048) (302,842) 323,770 (393,649)
(115,320) (266,286) (381,606)
(12,650) (174,047) - (186,697) ,
(132,989) (518,834) (21,134) (5,091) (678,048)
104,951 104,951
275,848 275,848 '
(156,008) (242,986) (461,467) (5,091) (865,552)
143,193 16,567 551,852 19,225 730,837
143,193 16,567 551,852 19,225 730,837
'
300,529 (593,297) 1,255,931 207,022 1,170,185
3,401,849 696,226 14,431,793 466,992 18,996,860
$ 3,702,378 $ 102,929 $ 15,687,724 $ 674,014 $ 20,167,045
Cash on hand and in banks $ - $ 1,200 $ 19,500 $ 497,714 $ 518,414 '
Equity in pooled cash and investments 3,702,378 101,729 8,168,224 176,300 12,148,631
Restricted equity in pooled cash and investments 7,500,000 - 7,500,000
Total cash and cash equivalents $ 3,702,378 $ 102,929 $ 15,687,724 $ 674,014 $ 20,167,045 i
The notes to the financial statements are an integral part of this statement.
?
94
City of Clearwater, Florida
Combining Statement of Cash Flows
Nonmajor Enterprise Funds
For the Year Ended September 30, 2006
Recycling Marine & Parking Harborview
utility Aviation System Center
Reconciliation of operating income (loss) to net
cash provided (used) by operating activities:
Operating income (loss)
Adjustments to reconcile operating income (loss)
to net cash provided (used) by operating activities:
Other revenue from nonoperating
section of income statement
Depreciation
Change in assets and liabilities:
(Increase) decrease in accounts receivable
(Increase) decrease in amount due from other governments
(increase) decrease in inventory
(Increase) decrease in prepaid expenses
Increase (decrease) in accounts and contracts payable
Increase (decrease) in deposits
Increase (decrease) in unearned revenue
(Increase) decrease in net pension asset
Increase (decrease) in accrued payroll
Total adjustments
Net cash provided (used) by operating activities
Noncash investing, capital and financing activities:
Amortization of bond issue costs
Decrease in net pension asset
Capital asset contributions from general government
Totals
$ 94,422 $ (646,199) $ 1,141,679 $ (787,281) $ (197,379)
- 133,795 6,039 9,891 149,725
290,349 377,666 230,938 552,744 1,451,697
(6,190) - 4,598 28,807 27,215
- 35,322 - 35,322
32,888 - (15,623) 17,265
- (6,230) (6,230)
(9,287) 1,100 (1,954) 69,901 59,760
(44) (750) 16,909 16,115
- - 2,800 - 2,800
45,810 36,859 44,230 126,899
(5,231) 15,105 5,486 - 15,360
315,451 597,369 326,709 656,399 1,895,928
$ 409,873 $ (48,830)
$ 1,468,388 $ (130,882) $ 1,698,549
:
$ - $ - $ (360) $ $ (360)
$ (45,810) $ (36,859) $ (44,230) $ $ (126,899)
$ $ 2,080,986 $ - $ $ 2,080,986
95
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Internal Service Funds
Internal service funds are used to account for services and commodities furnished by a designated
department to other departments within the City or to other governments on a cost reimbursement basis.
Garage Fund - to account for the cost of automotive and other motorized equipment of the City. The
acquisition cost of new or upgraded equipment is financed through user departments and the asset value is
simultaneously contributed to the Garage Fund. The cost of replacement of existing equipment is financed by
the Garage Fund.
' Administrative Services Fund - to account for various support activities including information technology,
printing, mailing, and telephone services. The cost for these services is charged to user departments based
on the cost of providing units of service.
General Services Fund - to account for various support activities including building maintenance and custodial
services for all City departments and facilities. The cost for these services is charged to user departments
based on the cost of providing units of service.
Central Insurance Fund - to account for the City's limited self-insurance program wherein all funds are
assessed charges based on damage claims incurred and on management's assessment of individual funds'
' risk exposure. All claims and premiums are paid out of this fund, together with other costs necessary to
administer the program. Medical insurance premiums are also paid from this fund.
1 97
ASSETS
Current assets:
Cash on hand and in banks
Equity in pooled cash and investments
Other receivables
Due from other funds
Inventories, at cost
Prepaid expenses and other assets
Total current assets
Noncurrent assets:
Interest receivable
Advances to other funds
Net pension asset
Capital assets:
Land and other nondepreciable assets
Capital assets, net of accumulated depreciation
Total noncurrent assets
Total assets
City of Clearwater, Florida
Combining Statement of Net Assets
Internal Service Funds
September 30, 2006
Garage Administrative General Central
Fund Services Services Insurance Total
1
$ - $ 1,900 $ - $ - $ 1,900
3,498,750 4,082,523 694,098 27,285,156 35,560,527
- 233 - 90,373 90,606
- - - 294,529 294,529
275,331 - - - 275,331
- - - 1,459,368 1,459,368
3,774,081 4,084,656 694,098 29,129,426 37,682,261
- - - 5,319,724 5,319,724
398,460 766,557 264,905 68,430 1,498,352
LIABILITIES
Current liabilities:
Accounts and contracts payable
Accrued payroll
Accrued interest payable
Due to other funds
Unearned revenue
Current portion of long-term liabilities:
Compensated absences
Notes, loan pool agreement and acquisition contracts
Claims payable
Total current liabilities (payable from current assets)
Noncurrent liabilities:
Compensated absences
Notes, loan pool agreement and acquisition contracts
Advances from other funds
Claims payable
Total noncurrent liabilities
Total liabilities
NET ASSETS
Invested in capital assets, net of related debt
Unrestricted
Total net assets
l
1
1,100,712 - 103,691 - 1,204,403
14,551,974 3,468,038 139,917 17,846 18,177,775 ,
16,051,146 4,234,595 508,513 5,406,000 26,200,254
19,825,227 8,319,251 1,202,611 34,535,426 63,882,515
72,541
69,300 88,126
124,296 21,534
61,254 162,026
14,204 344,227
269,054 ,
90,373 90,373
- 91,654 - - 91,654
1,020,889 - - - 1,020,889 '
14,574 31,701 13,066 5,070 64,411
3,076,799 212,693 35,072 - 3,324,564
-
-
-
2,408,000
2,408,000 '
4,254,103 638,843 130,926 2,589,300 7,613,172
137
938 ,
, 300,039 123,660 47,986 609,623
5,847,728 257,896 96,510 - 6,202,134
- 824,882 - - 824,882
-
-
-
7,192,000
7,192,000 '
5,985,666 1,382,817 220,170 7,239,986 14,828,639
10,239,769 2,021,660 351,096 9,829,286 22,441,811 '
6,728,159 2,997,449 112,026 17,846 9,855,480
2,857,299 3,300,142 739,489 24,688,294 31,585,224
$ 9,585,458 $ 6,297,591 $ 851,515 $ 24,706,140 $ 41,440,704
The notes to the financial statements are an integral part of this statement.
98 1
City of Clearwater, Florida
Combining Statement of Revenue, Expenses, and Changes in Fund Net Assets
Internal Service Funds
For the Year Ended September 30, 2006
Garage Administrative General Central
Fund Services Services Insurance Total
Operating revenues
Billings to departments $ 11,261,090 $ 8,706,358 $ 4,075,329 $ 17,824,352 $ 41,867,129
Operating expenses:
Personal services
Purchases for resale
and supplies 105,868 48,875 272,461 6,609 433,813
1 Operating materials
Transportation
Utility service
Depreciation
' Interfund administrate
Other current charge
Professional fees
Communications
Printing and binding
Insurance
Premiums
Claims incurred
Repairs and mainte
Rentals
' Miscellaneous
Data processing ch
Taxes
' Total other cur
rating expenses 12,005,737 8,445,262 4,084,692 15,403,057 39,938,748
Total ope
Operating income
Nonoperating revenu
ents 150,630 153,702 32,750 1,278,809 1,615,891
Earnings on investm
Interest expense
Gain (loss) on excha
Other
Total nonoperating
1 Income (loss) bef
Capital grants and con
Transfers in
Transfers out
Change in net assets
' Total net assets - beg
Total net assets - end
2,376,430 4,315,746 2,216,915 424,512 9,333,603
3,407,842 - - - 3,407,842
4,205 115,165 166,192 6,649 292,211
125,442 5,718 487,984 - 619,144
4,112,922 674,184 15,157 3,569 4,805,832
ve charges 372,760 58,790 - - 431,550
s:
293,605 172,222 - 91,798 557,625
27,500 1,298,486 46,960 9,767 1,382,713
19,508 - - 19,508
38,940
525,815 75,390
- 35,760
- 13,335,460
1,445,818 13,485,550
1,971,633
nance - 766,129 744,960 22,275 1,533,364
2,627 594,842 17,076 1,433 615,978
476,797 80,297 22,797 42,957 622,848
arges 128,620 219,910 58,430 12,210 419,170
6,364 - - - 6,364
rent charges 1,500,268 3,226,784 925,983 14,961,718 20,614,753
(loss) (744,647) 261,096 (9,363) 2,421,295 1,928,381
es(expenses)
(282,836) (54,622) (3,207) - (340,665)
nge of assets 579,667 (3,656) - 576,011
276,755 2,030 911 - 279,696
revenue (expenses) 724,216 97,454 30,454 1,278,809 2,130,933
ore transfers (20,431) 358,550 21,091 3,700,104 4,059,314
tributions - 39,435 - - 39,435
334,828 8,002 121,373 464,203
- - (132,681) - (132,681)
334,828 47,437 (132,681) 121,373 370,957
314,397 405,987 (111,590) 3,821,477 4,430,271
i
i 271
061
9 891
604
5 963
105 20
884
663 010
37
433
ng
nn ,
, ,
, , ,
, ,
,
ing $ 9,585,458 $ 6,297,591 $ 851,515 $ 24,706,140 $ 41,440,704
The notes to the financial statements are an integral part of this statement.
99
City of Clearwater, Florida
Combining Statement of Cash Flows
Internal Service Funds
For the Year Ended September 30, 2006
CASH FLOWS FROM OPERATING
ACTIVITIES
Cash received from other funds
Cash payments to suppliers
Cash payments to employees
Cash payments to other funds
Other revenues
Net cash provided by operating activities
CASH FLOWS FROM NONCAPITAL
FINANCING ACTIVITIES
Transfers in from other funds
Transfers out to other funds
Receipt of cash on loans to/from other funds
Net cash provided (used) by
noncapital financing activities
CASH FLOWS FROM CAPITAL AND
RELATED FINANCING ACTIVITIES
Principal payments on debt
Interest paid
Acquisition of capital assets
Sale of capital assets
Proceeds from issuance of debt
Net cash provided (used) by capital
and related financing activities
CASH FLOWS FROM INVESTING
ACTIVITIES
Interest on investments
Net cash provided by investing activities
Net increase in cash and cash equivalents
Cash and cash equivalents at beginning of year
Cash and cash equivalents at end of year
Cash and cash equivalents classified as:
Cash on hand and in banks
Equity in pooled cash and investments
Total cash and cash equivalents
Garage Administrative General Central
Fund Services Services Insurance Total
$ 11,261,090 $ 8,706,358 $ 4,075,329 $ 17,824,352 $ 41,867,129
(5,008,722) (2,697,413) (1,543,379) (17,010,209) (26,259,723)
(2,248,831) (4,091,917) (2,093,513) (398,597) (8,832,858)
(659,767) (767,524) (331,915) (45,685) (1,804,891)
212,950 2,030 911 - 215,891
3,556,720 1,151,534 107,433 369,861 5,185,548
334,828 - 121,373 456,201
- (132,681) - (132,681)
165,493 165,493
334,828 (132,681) 286,866 489,013
(3,242,185) (260,619) (23,941) (3,526,745)
(282,836) (17,239) (3,207) - (303,282)
(5,289,008) (729,679) (65,194) - (6,083,881)
625,772 - - - 625,772
4,210,090 239,483 102,711 - 4,552,284
(3,978,167) (768,054) 10,369 - (4,735,852)
150,630 153,702 32,750 1,278,809 1,615,891
150,630 153,702 32,750 1,278,809 1,615,891
64,011 537,182 17,871 1,935,536 2,554,600
3,434,739 3,547,241 676,227 25,349,620 33,007,827
$ 3,498,750 $ 4,084,423 $ 694,098 $ 27,285,156 $ 35,562,427
$ - $ 1,900 $ - $ - $ 1,900
3,498,750 4,082,523 694,098 27,285,156 35,560,527
$ 3,498,750 $ 4,084,423 $ 694,098 $ 27,285,156 $ 35,562,427
The notes to the financial statements are an integral part of this statement.
100
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u
1
City of Clearwater, Florida
Combining Statement of Cash Flows
Internal Service Funds
For the Year Ended September 30, 2006
Reconciliation of operating income (loss) to net
cash provided (used) by operating activities:
Operating income (loss)
Adjustments to reconcile operating income (loss)
to net cash provided (used) by operating activities:
Other revenue from nonoperating
section of income statement
Depreciation
Change in assets and liabilities:
(Increase) decrease in accounts receivable
(Increase) decrease in inventory
(Increase) decrease in prepaid expenses
Increase (decrease) in accounts and contracts payable
Increase (decrease) in unearned revenue
(Increase) decrease in net pension asset
Increase (decrease) in accrued payroll
Total adjustments
Net cash provided (used) by operating activities
Noncash investing, capital and financing activities:
Decrease in net pension asset
Garage Administrative General Central
Fund Services Services Insurance Total
$ (744,647) $ 261,096 $ (9,363) $ 2,421,295 $ 1,928,381
276,755 2,030 911 - 279,696
4,112,921 674,184 15,157 3,569 4,805,831
- 47 - - 47
24,362 - - 24,362
- - - (1,384,033) (1,384,033)
(176,465) (9,652) (22,674) (696,885) (905,676)
(63,805) - - - (63,805)
126,899 212,727 84,248 22,642 446,516
700 11,102 39,154 3,273 54,229
4,301,367 890,438 116,796 (2,051,434) 3,257,167
$ 3,556,720 $ 1,151,534 $ 107,433 $ 369,861 $ 5,185,548
$ (126,899) $ (212,727) $ (84,248) $ (22,642) $ (446,516)
101
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102
Fiduciary Funds
Fiduciary Funds are used to account for resources that are managed in a trustee capacity or as an agent for
other parties or funds.
Employees' Pension Fund - to account for the financial operation and condition of the major employee
retirement system.
Firemen's Relief and Pension Fund - to account for the financial operation and condition of the Firemen's
Relief and Pension Fund, closed to new members in 1962, containing 48 retired members and no active
members.
Police Supplemental Pension Fund - to account for the financial operation and condition of a supplemental
pension plan funded by the State for sworn police officers.
Firefighters Supplemental Pension Fund - to account for the financial operation and condition of a
supplemental pension plan funded by the State for firefighters.
Treasurer's Escrow Agency Fund - to account for the receipt, custody, and expenditure of funds held
temporarily in trust for other parties.
103
City of Clearwater, Florida
Combining Statement of Fiduciary Net Assets
Fiduciary Funds
September 30, 2006
Defined Benefit Defined Contribution
Pension Trust Funds Pension Trust Funds
Police Firefighters
Employees' Firemen's Supplemental Supplemental Totals
ASSETS
Cash on hand and in banks
Equity in pooled cash and investments
Managed investment accounts, at fair value:
Cash and cash equivalents
Government bonds
Agency bonds
Domestic corporate bonds
Domestic stocks
Mortgage backed bonds
Domestic equity mutual fund
International equity mutual fund
Fixed income mutual fund
Total managed investment accounts
Securities lending collateral
Receivables:
Interest and dividends
Unsettled investment sales
Securities lending earnings
Due from others
Total receivables
$ - $ - $ 16,194 $ $ 16,194
1,221,515 2,217,556 - - 3,439,071
10,701,781 - 149,362 825,586 11,676,729
56,809,304 - 3,880,851 605,134 61,295,289
6,681,307 4,800,783 685,991 164,236 12,332,317
51,136,791 - 164,091 937,077 52,237,959
222,410,983 - 7,762,735 4,433,511 234,607,229
84,286,886 - 65,304 751,620 85,103,810
61,108,737 - - - 61,108,737
61,002,944 - - 61,002,944
17,836,484 - - - 17,836,484
571,975,217 4,800,783 12,708,334 7,717,164 597,201,498
129,445,306 129,445,306
1,831,941 33,755 69,083 26,928 1,961,707
38,237,710 - - - 38,237,710
7,886 - 7,886
49,060 - - 181,805 230,865
40,126,597 33,755 69,083 208,733 40,438,168
Total assets 742,768,635 7,052,094 12,793,611 7,925,897 770,540,237
LIABILITIES
Accounts payable 658,973 - - - 658,973
Unsettled investment purchases 54,511,722 54,511,722
Obligations under securities lending 129,445,306 129,445,306
Total liabilities 184,616,001 - 184,616,001
NET ASSETS
Net assets held in trust for pension benefits $ 558,152,634 $ 7,052,094 $ 12,793,611 $ 7,925,897 $ 585,924,236
The notes to the financial statements are an integral part of this statement.
104
City of Clearwater, Florida
' Combining Statement of Changes in Fiduciary Net Assets
Fiduciary Funds
For the Year Ended September 30, 2006
Defined Benefit Defined Contribution
Pension Trust Funds Pension Trust Funds
' Police Firefighters
Employees' Firemen's Supplemental Supplemental Totals
ADDITIONS
Contributions:
Contributions from employer $ 7,417,042 $ 1,397,390 $ - $ - $ 8,814,432
Contributions from employees 5,953,763 - 5,953,763
' Other contributions 7,000 977,412 905,872 1,890,284
Total contributions 13,377,805 1,397,390 977,412 905,872 16,658,479
Investment Income:
Net appreciation (depreciation) in
fair value of investments 37,099,101 18,926 963,317 530,479 38,611,823
' Interest 8,768,280 364,641 211,870 148,561 9,493,352
Dividends 2,454,269 - 147,785 42,983 2,645,037
48,321,650 383,567 1,322,972 722,023 50,750,212
Less investment expenses:
Investment management/ custodian fees 2,739,421 71,358 93,519 2,904,298
Net income from investing activities 45,582,229 383,567 1,251,614 628,504 47,845,914
' Securities lending income:
Gross earnings 5,292,439 -
5,292,439
' Rebate paid
Bankfee (4,988,885)
(107,606) - - (4,988,885)
(107,606)
Net income from securities lending 195,948 - - 195,948
Total additions 59,155,982 1,780,957 2,229,026 1,534,376 64,700,341
DEDUCTIONS
Benefits and withdrawal payments:
Benefits 18,697,881 927,126 1,035,808 1,933,162 22,593,977
' Withdrawal payments 949,286 - - 949,286
Total benefits and withdrawal payments 19,647,167 927,126 1,035,808 1,933,162 23,543,263
' Income (loss) before administrative expenses 39,508,815 853,831 1,193,218 (398,786) 41,157,078
Administrative expenses 196,077 3,950 67,271 33,885 301,183
' Net increase (decrease) 39,312,738 849,881 1,125,947 (432,671) 40,855,895
Net assets held In trust for pension benefits:
Beginning of year 518,839,896 6,202,213 11,667,664 8,358,568 545,068,341
' End of year $ 558,152,634 $ 7,052,094 $ 12,793,611 $ 7,925,897 $ 585,924,236
The notes to the financial statements are an integral part of this statement.
105
City of Clearwater, Florida
Statement of Changes in Assets and Liabilities
Agency Fund
For the Year Ended September 30, 2006
ASSETS
Equity in pooled cash and investments
LIABILITIES
Deposits:
Property owners
Developers
Other miscellaneous payables:
Downtown Development Board
Special purpose funds
Other
Total Liabilities
Balance Balance
October 1, September 30,
2005 Additions Deductions 2006
$ 133,304 731,442 321,199 $ 543,547
$ 21,944 - 21,944 $ -
10,708 - 10,708 -
- 599,048 277,388 321,660
7,610 2,110 1,586 8,134
93,042 130,284 9,573 213,753
$ 133,304 731,442 321,199 $ 543,547
The notes to the financial statements are an integral part of this statement.
106
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Supplementary
Information
107
Page 1 of 5
City of Clearwater, Florida '
Continuing Disclosure - Gas System Revenue Bonds
Series 1997B, 1998,2004, and 2005
Supplementary Information
The System: '
Rates, Fees and Charges
The City Council has established a schedule of rates and charges by ordinance, which includes a '
purchased gas cost adjustment provision allowing the City to pass-through to customers any increase or
decrease in the purchased price of gas. The City is not subject to regulation by any State agency in '
establishing or revising its rates. Where competitive fuel sources or transportation service are available to
the customer, the City Council has authorized the City Manager to enter into contract gas service rates at
special rates and/or conditions as required to obtain/retain the customer load. Such contract service must ,
meet the normal construction feasibility formula to insure profitable payback to the City. As of September
30, 2006, contract rates applied to 760 customer accounts and impacted 32.69% of total revenues.
The rates charged by the System through September 30, 1996, were part of the Phase I Gas Rate Case ,
implemented October 1, 1995, which was based on a comprehensive cost of service study performed by
the Utility Advisory Services Group of the international accounting firm of Coopers & Lybrand, LLP (the
"Rate Study"). This Phase I implementation resulted in an extensive overhaul of the Gas System customer '
rates, providing numerous classes of service and a modernized billing methodology.
1
The new rates, effective October 1, 1996, were designed to be industry-based and responsive to the
competitive energy challenges. The goal of the Rate Study was to establish rates which would be fair to ,
all classes of customers, provide funding to implement planned expansion in both existing northern
Pinellas County services area and into the newly acquired southwestern Pasco service area, and provide '
an adequate growth potential in return to the City of Clearwater to further offset the ad valorem tax rates
(current impact is about 0.5 mills).
As the result of experiences during the first seven months of the Phase I implementation, adjustments
made to the Phase If rates were implemented October 1, 1996 and additional adjustments (Phase III) were '
implemented effective October 1, 1997. The total projected impact of both new phases of the rate case is
$1.05 million or less than 7.9% of total gas sales revenues.
The rate ordinance containing the Phase II and Phase III rate changes was approved by the City Council '
on June 6, 1996.
Gas rates for customer charges were increased effective April 1, 2005. The total estimated annual impact
of this rate increase is $373,352.
108 ,
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City of Clearwater, Florida
Continuing Disclosure - Gas System Revenue Bonds
Series 1997B, 1998, 2004, and 2005
Supplementary Information
Page 2 of 5
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Page 3 of 5
City of Clearwater, Florida
Continuing Disclosure - Gas System Revenue Bonds
Series 1997B, 1998, 2004, and 2005
Supplementary Information
t
GAS SUPPLY
On August 1, 1990, the Federal Energy Regulatory Commission (FERC) deregulated the natural gas pipeline industry.
This allows other natural gas suppliers and local distribution companies, like the City of Clearwater, to transport gas over
the Florida Gas Transmission (FGT) pipelines as opposed to purchasing natural gas supply from only FGT.
The two natural gas transmission companies that serve within the State of Florida are Florida Gas Transmission (FGT)
and Gulfstream. Currently FGT is the sole provider of transportation service to the City. Citrus Corp, which is equally
owned by Cross Country Energy Corp AND Southern Natural, an El Paso Corporation Affiliate, owns FGT. Cross
Country Energy Corp is a newly formed holding company that holds Enron Corp interests and operates three major North
American natural gas pipeline businesses.
The City joined Florida Gas Utility (FGU) in October 2000 by Resolution 00-35. FGU is responsible for the purchase &
management of the City's natural gas supply. An updated All Requirements Gas Service Agreement, which was
approved by Resolution 02-02 in January 2002, required the City to purchase 100% of its supply through FGU. FGU was
formed through an Interlocal Agreement among its members. The Interlocal Agreement became effective on September
1, 1989 and consisted of five municipal utilities. Over the next several years, additional electric and gas distribution
utilities joined FGU, bringing its current membership to 23 entities.
In addition, the City has entered into a Gas Supply & Transportation Agreement with Peoples Gas System (PGS), dated
12/2/04, to purchase natural gas in order to serve customers located in our Central Pasco territory, generally east of the
Suncoast Parkway in Pasco County. The City has received a letter from FGU Council, dated 8/31/04, granting the City
permission to utilize Teco Peoples Gas as a third party gas supplier since FGU is unable and unwilling to provide gas to
the City within the meaning of the provisions of Section 3 (a)(i) and (ii) of the ALL Requirements Gas Service Agreement
between the City and FGU.
The City has two Firm Transportation Service agreements (FTS-1 & FTS-2) with FGT in order to deliver natural gas to
the City's four gate stations. FGU is currently managing our Phase II (FTS-1) and Phase III (FTS-2) transportation
capacity on a daily basis. Table 1 shows the breakdown of our annual gas supply entitlements with FGT. The total
annual entitlement is 3,212,226 decatherms of natural gas transportation.
Table 1 Breakdown of Transportation Capacity
Phase II (FTS-1) Phase III (FTS-2) Total
MMBtu per day MMBtu per day MMBtu per day
Contract period 10/1/93 - 1 /31 /07 12/9/91 - 2/28/15
October 170,438 41,788 212,226
Nov-Mar 1,543,069 268,931 1,812,000
April 216,570 53,430 270,000
ay-Sept 711,756 206,244 918,000
Total annual 2,641,833 570,393 3,212,226
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City of Clearwater, Florida
Continuing Disclosure - Gas System Revenue Bonds
Series 1997B, 1998,2004, and 2005
Supplementary Information
Page 4 of 5
The Clearwater Gas System (CGS) is owned and operated as an enterprise utility by the City of
Clearwater. CGS operates over 786 miles of underground gas main and handles the supply and
distribution of both natural and propane (LP) gas throughout northern Pinellas County and western Pasco
County. As a 'lull service" gas utility, CGS provides gas appliance sales, service and repair (both
commercial and residential), installation of customer gas piping, construction and maintenance of
underground gas mains and service lines, and 24 hour response to any gas emergency call within the
service area. CGS is regulated for safety by the Florida Public Service Commission and the Federal
Department of Transportation.
CGS has been serving customers in the Clearwater area for over 84 years (since 1923) when operations
were begun with a manufactured gas plant operation from coal and coke. In 1959, when natural gas
transmission lines were finally extended to the Florida peninsula, CGS discontinued manufacturing gas
and began receiving piped natural gas from Florida Gas Transmission.
Clearwater Gas System serves over 19,035 customers in a 330 square mile service territory, which
includes 17 municipalities as well as the unincorporated areas of northern Pinellas County and western
Pasco County. The Pinellas County service territory is 181 square miles and extends generally from
Ulmerton and Walsingham Roads on the South to the Pasco County line on the North and from the Gulf of
Mexico on the West to the Hillsborough County line on the East. This includes all of the Pinellas beach
communities south to Redington Beach. The Pasco County service territory is 117 square miles and
extends from the Gulf of Mexico on the West inland about 10 miles to just West of State Road 41 and Land
O' Lakes (generally along the right-of-way of the Suncoast Parkway) and from the Pinellas and
Hillsborough County lines on the South to generally State Road 52 on the North. The CGS service
territory extends 42.3 miles from the southernmost to the northernmost points.
Clearwater Gas System prides itself in being a competitive and public service-minded utility, providing
safe, economical and environmentally-friendly gas, which is made in America, available in our communities
for all of the homes and businesses in our service area, with special focus on the residential customers
who make up over 88.30% of our customer base.
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Page 5 of 5
City of Clearwater, Florida
Continuing Disclosure - Gas System Revenue Bonds
Series 1997B, 1998, 2004, and 2005
Supplementary Information
As of September 30, 2006 the System's active natural gas customers were located as shown in the
following table:
Location
Belleair
Belleair Beach
Belleair Bluffs
Belleair Shores
Clearwater
Dunedin
Indian Rocks Beach
Indian Shores
Largo
New Port Richey
North Redington Beach
Oldsmar
Port Richey
Redington Beach
Redington Shores
Safety Harbor
Tarpon Springs
Unincorporated Areas Pasco
Central Pasco
Unincorporated Areas Pinellas
Total
Meters
380
122
21
18
6,658
1,027
75
55
990
333
11
67
15
21
9
587
1,377
2,309
103
2,730
16,908
Percentage
2.25%
0.72%
0.12%
0.11%
39.38%
6.07%
0.44%
0.33%
5.86%
1.97%
0.07%
0.40%
0.09%
0.12%
0.05%
3.47%
8.14%
13.66%
0.61%
16.15%
100.00%
The following table shows the five largest interruptible customers by peak monthly consumption anc
the percent of the System's revenues derived from such customers during the 12 months endinc
September 30, 2006:
Peak Monthly % of Gross
Customer Name Therms Revenues
Morton Plant Hospital
Mease Hospital
Angelica Textile Service
Metal Industries
Firmenich Citrus Center
100,366 3.14%
91,412 2.89%
88,788 2.04%
76,432 1.59%
24,788 1.10%
The following table shows the breakdown of the System's customers by category as well as the volumE
of gas sold and the sales revenues generated by each category for the year ended September 30, 2006
Average No.
Customers
Interruptible 13
Residential 14,767
Commercial 2,128
Interruptible
Residential
Commercial
Totals
Gas
Volume
23.90%
15.11%
60.99%
Therms
Gas
Sales
14.32%
22.66%
63.02%
Revenues
5,118,873
3,235,612
13,063,617
21,418,102
$ 5,242,260
8,290,911
23,062,894
$ 36,596,065
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City of Clearwater, Florida
Continuing Disclosure - Water and Sewer Refunding Revenue Bonds
Series 1998 and 2003; and Revenue Bonds Series 2002 and 2006
Supplementary Information
Historical Financial Information
Water System:
Source and Volume of Water Pumped
(in million gallons per day, averaged over the Fiscal Year)
FY Ci Wells Coun
2001 3.067 11.260
2002 2.258 11.739
2003 3.927 8.916
2004 3.601 9.544
2005 3.550 10.630
2006 4.093 9.999
Historical Growth in Number of Water Customers
(all figures are as of September of the year indicated)
Year Water Customers
2001 40,167
2002 40,340
2003 40,227
2004 40,235
2005 40,178
2006 40,467
Ten Largest Water Customers
Fiscal Year Ending September 30, 2006
Water Used
Name of User (in 100 Cubic Feet)
1 1. Church of Scientology FSO Inc. 114,814
2. Morton Plant Hospital 71,826
3. Pinellas County Schools 45,422
4. City of Clearwater 33,831
5. Clearwater Housing Authority 48,626
6. United Dominion Realty Trust 41,381
7. Sheraton Sand Key 38,922
' 8. IMT-LB Central FL Portfolio LLC 35,290
9. AGH Leasing UP 38,104
10. Ultimar Condo Association 26.391
Total
113
Page 1 of 3
Total
14.327
13.997
12.843
13.145
14.180
14.092
Revenues
Produced
$ 408,738
302,000
231,581
226,701
177,997
134,341
134,309
126,317
116,114
104.482
1.962.580
Page 2 of 3
City of Clearwater, Florida
Continuing Disclosure - Water and Sewer Refunding Revenue Bonds
Series 1998 and 2003; and Revenue Bonds Series 2002 and 2006
Supplementary Information
Sewer System:
Average Sewage Flow Historical Growth in Number of Sewer Customers
(as of September of the year indicated)
Fiscal Annual Ave. Daily Fiscal Sewer Customers
Year Flow In MGD Year
2001 14.4 2001 32,933
2002 14.3 2002 33,215
2003 16.2 2003 33,215
2004 15.0 2004 33,234
2005 14.7 2005 33,305
2006 13.8 2006 33,279
Ten Largest Sewer Customers
Fiscal Year Ending September 30, 2006
Sewer Used Revenues
Name of Use (in 100 Cubic Feet) Produced
1. Church of Scientology 93,546 $ 373,693
2. Morton Plant Hospital 69,606 339,694
3. Pinellas County Schools 40,510 273,311
4. United Dominion Realty Trust 41,381 171,369
5. Clearwater Housing Authority 41,291 160,282
6. AGH Leasing UP 38,104 147,818
7. IMT-LB Central FL Portfolio LLC 35,290 136,489
8. Sheraton Sand Key 31,531 126,157
9. City of Clearwater 11,833 115,979
10. Japanese Gardens 21.228 83.086
Total 4 $ 27 7 j
Rates. Fees And Charges
The City uses a three-tiered rate structure for water and sewer usage. The base rate includes a
minimum usage for residential and nonresidential water rates. Any usage over the minimum is
billed at one rate per 100 cubic feet up to a designated level and at a second rate for usage over
that level. For irrigation, there is a base rate, with no minimum, and a charge per 100 cubic feet of
water usage up to a designated level and a higher charge for usage over that amount. The sewer
base rate includes a minimum usage and a fixed charge per 100 cubic feet of water usage over
the basic allowance. The minimum usage and second tier usage level vary with the size of the
meters. For fiscal year 2006 there were no changes to the three-tiered rate structure for water or
sewer usage. Effective October 1, 2000 the basis for billing was converted from cubic feet to
gallons.
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Page 3 of 3
City of Clearwater, Florida
Continuing Disclosure - Water and Sewer Refunding Revenue Bonds
Series 1998 and 2003; and Revenue Bonds Series 2002 and 2006
Supplementary Information
Residential and October 1, October 1, October 1, October 1, October 1,
Nonresidential Water Rates 2002 2003 2004 2005 2006
Size of Meter Gallons
Minimum- Under 1 inch 8.64 9.90 10.59 11.34 12.03
l inch 20.16 23.10 24.71 26.46 28.07
1.5 inch 288.00 330.00 353.00 378.00 401.00
2 inch 671.04 768.90 822.49 880.74 934.33
3 or 2 inch manifold 1,033.92 1,184.70 1,267.27 1,357.02 1,439.59
4 inch 1,990.08 2,280.30 2,439.23 2,611.98 2,770.91
6 inch 5,112.00 5,857.50 6,265.75 6,709.50 7,117.75
8 inch 8,640.00 9,900.00 10,590.00 11,340.00 12,030.00
Additional charges are assessed for cubic feet of usage in excess of designated minimums.
Rates for Irrigation (Lawn) Meters October 1, October 1, October 1, October 1, October 1,
2002 2003 2004 2005 2006
Size of Meter Gallons
Minimum- Under 1 inch 3.08 3.53 3.78 4.04 4.28
l inch 9.24 10.59 11.34 12.13 12.86
1.5 inch 46.20 52.95 56.70 60.67 64.31
2 inch 129.36 148.26 158.76 169.87 180.06
3 or 2 inch manifold 255.64 292.99 313.74 335.70 355.84
4 inch 492.80 564.80 604.80 647.14 685.97
6 inch 1,487.64 1,704.99 1,825.74 1,953.54 2,070.75
Sewer Rates October 1, October 1, October 1, October 1, October 1,
2002 2003 2004 2005 2006
Size of Meter Gallons
Minimum- Under 1 inch 11.88 13.62 14.58 15.60 16.53
l inch 27.72 31.78 34.02 36.40 38.57
1.5 inch 396.00 454.00 486.00 520.00 551.00
2 inch 922.68 1,057.82 1,132.38 1,211.60 1,283.83
3 or 2 inch manifold 1,421.64 1,629.86 1,744.74 1,866.80 1,978.09
4 inch 2,736.36 3,137.14 3,358.26 3,593.20 3,807.41
6 inch 7,029.00 8,058.50 8,626.50 9,230.00 9,780.00
8 inch 11,880.00 13,620.00 14,580.00 15,600.00 16,530.00
Per 100 cubic feet of water used over
that allowed in minimum 3.96 4.54 4.86 5.20 5.51
Additional Indebtedness
Additional indebtedness incurred totaled $26,430,000 for capital improvements to the Water and
Sewer systems and $82,091 for the lease purchase of capital equipment.
115
City of Clearwater, Florida
Continuing Disclosure - Stormwater System Revenue Bonds
Series 1999, 2002, 2004, and 2005 ,
Supplementary Information
Rates. Fees, and Charges
The City uses a measurement of one equivalent residential unit or ERU as the basis for the
stormwater management utility fee. The rate per ERU was unchanged from the inception of the
utility on January 1, 1991 until 1998 when annual increases were adopted for five fiscal years
beginning October 1, 1998. In November 2001, additional increases were adopted including a
change to the increase previously adopted, to be effective October 1, 2002. Effective August 5,
2004, additional increases were adopted. On July 20, 2006, rate increases were adopted for the
five-year period beginning October 1, 2007. The monthly rates are as follows:
Effective Date Rate Per ERU
January 1, 1991 $3.00
October 1, 1998 $4.00
October 1, 1999 $4.17
October 1, 2000 $4.35
October 1, 2001 $4.54
January 1, 2002 $6.13
October 1, 2002 $7.16
October 1, 2003 $8.01
October 1, 2004 $8.65
October 1, 2005 $9.35
October 1, 2006 $9.71
October 1, 2007 $10.51
October 1, 2008 $11.14
October 1, 2009 $11.80
October 1, 2010 $12.51
Single-family homes, multifamily units, condominium units, apartments and mobile homes are
rated as one ERU per dwelling unit. Nonresidential property is charged at the rate of 1,830 square
feet of impervious area per ERU.
HISTORICAL NET REVENUES
Fiscal Years Ended Sentember 30.
2002 2003 2004 2005 2006
Net Operating Revenues (Excluding
Depreciation) $2,793,204 $3,726,983 $3,566,465 $4,548,421 $5,103,551
Interest Income and other Non-
Operating Revenues (Expenses) 95,305 206,202 190,579 220,570 465,203
Total Net Revenues $2,888,509 $3,933,185 $3,757,044 $4,768,991 $5,568,754
Maximum Annual Debt Service $2,052,538 $2,052,538 $2,913,506 $2,889,994 $2,889,994
Coverage 1.41 1.92 1.29 1.65 1.93
116
City of Clearwater, Florida
Continuing Disclosure - Infrastructure Sales Tax
Revenue Bonds, Series 2001
Supplementary Information .
Historical Debt Service Coverage
2001 2002 2003 2004 2005 2006
Sales tax revenues (1) $ 8,339,694 $ 8,457,553 $ 8,661,615 $ 9,119,913 $ 9,977,529 $ 10,704,390
Maximum annual debt service $ 7,083,688 $ 7,083,688 $ 7,049,688 $ 7,028,888 $ 6,955,888 $ 6,887,888
Debt service coverage
1.18 1.19 1.23 1.30 1.43 1.55
(1) The Infrastructure Sales Tax Revenue Bonds, Series 2001, were issued June 1, 2001 in the amount of $46,445,000.
They are secured by a lien upon and a pledge of the City's share of the proceeds derived by Pinellas County, Florida
from the levy and collection of the one-cent discretionary infrastructure sales tax pursuant to Section 212.055(2), Florida
Statutes, as amended (sales tax revenues).
City of Clearwater, Florida
Continuing Disclosure - Improvement Revenue
Refunding Bonds, Series 2001
Supplementary Information
Historical Debt Service Coverage
2001 2002 2003 2004 2005 2006
Pledged Revenues (1) $ 15,486,388 $ 18,272,521 $ 17,381,418 $ 17,026,827 $ 17,493,450 $ 18,117,728
Maximum annual debt service $ 866,760 $ 866,760 $ 865,310 $ 865,310 $ 864,060 $ 861,000
Debt service coverage 17.87 21.08 20.09 19.68 20.25 21.04
(1) The Improvement Revenue Refunding Bonds, Series 2001, were issued October 15, 2001 in the amount of
$11,470,000. They were secured by a lien upon and a pledge of the Public Service Tax pursuant to Section 166.231,
Florida Statutes as amended. Effective October 1, 2001, the Florida Legislature repealed the public service tax on
telecommunications created per Section 166.231(9), Florida Statutes, and created a simplified tax structure for
communications services pursuant to Chapter 2000-260, Laws of Florida. To the extent that the Public Service Tax
receipts derived by the City pursuant to Section 166.231(9), Florida Statutes, is eliminated as a result of this new tax, all
of the revenues received by the City pursuant to the new Communications Services Tax shall be deemed to replace the
Public Service Tax receipts so eliminated. Consequently the pledged revenues include both public service taxes and
communications services taxes effective October 1, 2001.
117
City of Clearwater, Florida
Fire Services Program
Supplementary Information
Pursuant to agreements between the City of Clearwater, the Pinellas County Fire Authority and the Pinellas
County Emergency Medical Services Authority, the City has provided fire and emergency medical services to the
respective authorities. With respect to fire services, the services are provided for the benefit of properties
located outside the corporate limits of the City, but within a designated service area. Emergency medical
services are provided for the benefit of persons residing both inside and outside the corporate limits of the City,
based on the Authority's nearest unit dispatch policy.
With respect to the Fire Services Program, a budget was prepared by Fire Department personnel covering
proposed expenditures for fiscal year ending September 30, 2006, for the Fire Department as a whole. Since
the funding for the Emergency Medical Services Program is based on the level fixed in prior years, the Fire
Services Program budget is essentially the residual obtained by deducting the approved level of funding for the
Emergency Medical Services Program from the budgeted amounts included in the total Fire Department budget.
This budget was submitted to, and duly approved by, the relevant Authority prior to the commencement of the
fiscal year. Income received from Pinellas County Fire Protection Authority and valid program expenditures for
the Fire Services Program for the fiscal year ended September 30, 2006 are summarized below.
Total Revenue Received from Pinellas County Fire Protection Authority
Total Fire Service Expenditures for Fiscal Year Ended September 30, 2006
The Fire Services Program does not currently utilize an equipment reserve.
118
$ 2,307,068
$ 16,886,990
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This section of the City's CAFR presents detailed information as a context for understanding what the
information in the financial statements, note disclosures, and required supplementary information say
about the City's overall financial health. This information has not been audited by the independent
auditor.
Financial Trends
These schedules contain trend information to help the reader understand how the City's financial
performance and well-being changed over time.
Schedule 1 Net Assets by Component
Schedule 2 Changes in Net Assets
Schedule 2a Program Revenues by Function/Program
Schedule 3 Fund Balances of Governmental Funds
Schedule 4 Changes in Fund Balances of Governmental Funds
Revenue Capacity
These schedules contain information to help the reader assess the City's significant local revenue
sources, the property tax, as well as other revenue sources.
Schedule 5 Assessed Value and Estimated Actual Value of Taxable Property
i Schedule 6
Schedule 7 Direct and Overlapping Property Tax Rates
Property Tax Levies and Collections
Schedule 8a Principal Real Property Taxpayers
Schedule 8b Principal Personal Property Taxpayers
Debt Capacity
These schedules resent 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.
Schedule 9 Ratios of Outstanding Debt by Type
Schedule 10 Ratios of General Bonded Debt Outstanding
Schedule 11 Direct and Overlapping Governmental Activities Debt
Schedule 12 Legal Debt Margin Information
Schedule 13 Pledged-Revenue Coverage
1 119
[l
STATISTICAL SECTION (CONTINUED)
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Economic and Demographic Information I
These schedules offer economic and demographic indicators to help the reader understand the
environment within which the City's financial activities take place.
Schedule 14 Demographic and Economic Statistics
Schedule 15 Principal Employers
Operating Information I
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.
Schedule 16 Full-time Equivalent City Government Employees by Function/Program
Schedule 17 Operating Indicators by Function/Program
Schedule 18 Capital Assets Statistics by Function/Program
t
Sources: Unless otherwise noted, the information in this section is derived from the City's
comprehensive annual financial reports for the relevant year. The City implemented the new reporting
model, GASB 34, in the fiscal year ending September 30, 2002.
C1
120
Schedule 1
City of Clearwater, Florida.
Net Assets by Component,
Last Five Fiscal Years
(accrual basis of accounting)
Governmental activities
Invested in capital as
Fiscal Year
(amounts in thousands)
2002 2SZQ$ 2044 200 2095
sets, net of related debt a $ 60,970 $103,015 $133,711 $143,505 $184,799
Restricted 63,795 53,939 50,801 34,668 41,203
Unrestricted 67,099 62,599 61,163 92,739 98,970
'
Total governmental activities net assets $191,864 $219,553 $ 245,675 $ 270,912 $ 324,972
Business-type activities
Invested in capital assets, net of related debt $ 86,679 $105,824 $136,964 $146,476 $156,728
Restricted 38,382 33,413 37,108 35,354 35,054
Unrestricted 93,847 90,769 67,723 71,655 78,700
Total business-type activities net assets $218,908 $230,006 $ 241,795 $ 253,485 $ 270,482
Primary government
Invested in capital assets, net of related debi $147,649 $208,839 $ 270,675 $ 289,981 $ 341,527
Restricted 102,177 87,352 87,909 70,022 76,257
Unrestricted 160,946 153,368 128,886 164,394 177,670
Total primary government net assets $410,772 $449,559 $ 487,470 $ 524,397 $ 595,454
a Fiscal 2003 and 2004 increases in governmental activities invested in net assets, net of related debt were due to the
construction of a spring training community sports complex ($28.9 million), a new main library ($17.2 million), donation
of a recreation center complex ($5.8 million) and construction of two new fire stations ($3.6 million) over the two-year
period. The fiscal 2006 increase was due to the implementation of the retroactive infrastructure component of GASB
Statement #34, resulting in the addition of $36.3 million of governmental activities capital assets.
Note: The City began to report accrual information when it implemented GASB Statement 34 in fiscal year 2002.
121
Schedule 2
Page 1 of 2
Expenses
Governmental activities:
City of Clearwater, Florida
Changes in Net Assets
Last Five Fiscal Years
(accrual basis of accounting)
General government
Public safety
Physical environment
Transportation
Economic environment
Human services
Culture and recreation
Interest on long-term debt
Total governmental activities expenses
Business-type activities:
Water and sewer utility
Gas utility
Solid waste utility
Stormwater utility
Recycling
Marine
Aviation
Parking system
Harborview center
Total business-type activities expenses
Total primary government expenses
Program revenues
Governmental activities:
Charges for services:
General government
Public safety
Physical environment
Transportation
Economic environment
Human services
Culture and recreation
Operating grants and contributions
Capital grants and contributions
Total governmental activities program revenues
Business-type activities:
Charges for services:
Water and sewer utility
Gas utility
Solid waste utility
Stormwater utility
Recycling
Marine
Aviation
Parking system
Harborview center
Operating grants and contributions
Capital grants and contributions
Total business-type activities program revenues
Total primary government program revenues
Fiscal Year
(amounts in thousands)
2002 290 2444 249;1 2495
$ 11,647 $ 11,353 $ 11,772 $ 11,945 $ 13,203
45,136 47,429 51,454 56,456 60,178
2,886 2,271 2,684 2,826 3,098
10,120 8,878 12,510 12,001 13,898
3,231 4,288 3,225 3,395 3,321
555 571 555 530 444
22,231 22,094 25,402 28,875 32,636
2,963 3,284 3,013 2,699 2,373
98,769 100,168 110,615 118,727 129,151
37,470 40,825 41,995 43,852 48,592
23,574 26,638 29,152 33,394 36,947
14,398 14,232 15,096 15,615 16,013
5,459 7,022 8,250 8,768 9,013
2,084 2,165 2,388 2,574 2,579
2,848 3,060 3,249 3,801 4,303
336 211 299 350 468
3,075 3,281 3,617 3,846 3,976
2,714 2,525 2,418 2,552 2,618
91,958 99,959 106,464 114,752 124,509
$ 190,727 $ 200,127 $ 217,079 $ 233,479 $253,660
$ 11,741 $ 12,268 $ 12,961 $ 13,585 $ 14,628
7,747 7,960 7,742 7,500 8,222
93 180 76 119 150
59 126 159 163 235
124 91 87 164 110
- 6 - - -
3,070 3,191 4,344 4,753 5,296
6,224 8,267 6,605 6,273 7,181
9,787 5,207 3,129 15,058 3,405
38,845 37,296 35,103 47,615 39,227
37,739 39,207 43,143 45,306 49,159
26,890 30,064 33,001 37,469 43,160
16,090 15,960 16,403 16,541 16,816
6,767 8,485 9,526 10,319 11,138
2,171 2,427 2,649 2,784 2,740
2,735 2,949 3,072 3,721 4,075
144 176 187 205 213
4,097 4,003 4,418 4,752 4,981
1,872 1,661 1,654 1,646 1,842
- 14 420 59 59
4,301 9,406 5,591 6,138 6,639
102,806 114,352 120,064 128,940 140,822
$ 141,651 $ 151,648 $ 155,167 $ 176,555 $180,049
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Schedule 2 (continued)
City of Clearwater, Florida
Changes in Net Assets
Last Five Fiscal Years
(accrual basis of accounting)
Page 2 of 2
Net (Expenses) / Revenue
Governmental activities
Business-type activities
Total primary government net (expense) / revenue
General Revenues and Other Changes in Net Assets
Governmental activities:
Taxes
Property
Sales
Franchise
utility
Communications services
Other taxes
Investment earnings
Miscellaneous
Special items a
Transfers
Total governmental activities
Business-type activities:
Investment earnings
Transfers
Total business-type activities
Total primary government
Change in Net Assets
Governmental activities
Business-type activities
Total primary government change in net assets
Fiscal Year
(amounts in thousands)
2442 2495 20M 244;1 2495
$ (59,924) $ (62,872) $ (75,512) $ (71,112) $ (89,924)
10,848 14,393 13,600 14,188 16,313
$ 49,076 $ 48,479 _1±1,912
$(56,924) -$(73,611)
$ 30,322 $ 33,927 $ 37,157 $ 41,588 $ 48,076
14,664 14,529 15,263 16,351 17,155
7,087 7,140 7,505 8,226 9,435
10,402 10,363 10,237 10,611 11,264
7,870 7,019 6,790 6,883 6,854
4,294 3,974 4,435 5,183 5,523
4,859 2,188 3,231 2,648 5,352
213 168 758 151 396
- 5,810 10,047 - -
376 5,443 4,515 4,707 3,658
80,087 90,561 99,938 96,348 107,713
3,083 2,148 1,987 2,210 4,341
376 5,443 4,515 4,707 3,658
2,707 3,295 2,528 2,497 683
$ 82,794 $ 87,266 $ 97,410 $23,251 $108,396
$ 20,163 $ 27,689 $ 24,426 $ 25,236 $ 17,789
13,555 11,098 11,072 11,691 16,996
$ 33,718 $ 38,787 $ 35,498 $ 36,927 $ 34,785
a Special items for fiscal 2003 and 2004 consisted of a donated recreation complex and a cash donation for a new
Spring Training sports complex, respectively.
Note: The City began to report accrual information when it implemented GASB Statement 34 in fiscal year 2002.
123
Schedule 2a
City of Clearwater, Florida
Program Revenues by Function/Program
Last Five Fiscal Years
(accrual basis of accounting)
Function/Program
Governmental activities:
General government
Public safety
Physical environment
Transportation
Economic environment
Human services
Culture and recreation
Subtotal governmental activities
Business-type activities:
Water and sewer utility
Gas utility
Solid waste utility
Stormwater utility
Recycling
Marine
Aviation
Parking system
Harborview center
Subtotal business-type activities
Total primary government
Fiscal Year
(amounts in thousands)
2002 2492 2004 2= 206
$ 11,843 $ 12,340 $ 13,090 $ 13,605 $ 14,697
9,046 9,661 9,009 9,207 9,275
1,052 1,118 796 448 1,274
6,261 3,982 2,003 14,056 a 2,300
2,802 4,028 2,629 2,425 2,708
- 6 - - -
7,841 6,161 7,576 7,874 8,973
38,845 37,296 35,103 47,615 39,227
40,051 43,120 46,357 47,656 52,264
26,890 30,064 33,001 37,469 43,160
16,090 15,974 16,823 16,541 16,816
8,262 13,411 11,158 14,061 14,343
2,171 2,427 2,649 2,843 2,799
2,735 2,953 3,750 3,721 4,128
638 739 253 251 489
4,097 4,003 4,418 4,752 4,981
1,872 1,661 1,655 1,646 1,842
102,806 114,352 120,064 128,940 140,822
$ 141,651 $ 151,648 $ 155,167 $ 176,555 $ 180,049
Note: The City began to report accrual information when it implemented GASB Statement 34 in fiscal
year 2002.
a In 2005, the City received a $10 million reimbursement grant from the Florida Department of Revenue
for construction of the new Clearwater Memorial Causeway Bridge.
124
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Schedule 6
City of Clearwater, Florida
Direct and Overlapping Property Tax Rates '
Last Ten Fiscal Years
(rate per $1,000 of assessed value)
Cit y Direct Rates Overlapping Rates
Pinellas Pinellas Emergency Downtown
Fiscal GOB Debt Total Pinellas County Transit Medical Other Develop.
Year Operating Service Direct County Schools District Services Districts Board a
1997 $ 5.0890 $ 0.0268 $5.1158 $ 5.5100 $ 9.1760 $ 0.6697 $ 0.7410 $1.6561 $ 1.0000
II
1998 5.0866 0.0292 5.1158 5.5380 9.1330 0.6697 0.7130 1.6561 1.0000
1999 5.0861 0.0297 5.1158 5.5380 9.1100 0.6501 0.7130 1.6561 1.0000
2000 5.5032 0.0000 5.5032 5.8540 8.6660 0.6501 0.6470 1.6572 1.0000
2001
5.5032 0.0000 5.5032 6.0040 8.4330 0.6501 0.7470 1.6562 1.0000
2002 5
5032 0
0000 5
5032 6
141
. . .
.
0 8.4870 0.6501 0.6600 1.6562 1.0000
2003 5.7530 0.0000 5.7530 6.1410 8.4490 0.6319 0.6600 1.6562 1.0000
2004 5.7530 0.0000 5.7530 6.1410 8.2430 0.6319 0.6600 1.6562 1.0000
2005 5.7530 0.0000 5.7530 6.1410 8.1220 0.6377 0.6600 1.6557 1.0000 r
2006 5.7530 0.0000 5.7530 6.1410 8.3900 0.6377 0.6600 1.6555 b 1.0000
Source: Pinellas County Property Appraiser
a A separate taxing district established by referendum which affects only downtown properties.
b "O
h
" i
t
er
ncludes Pinellas Coun ty Planning Council 0.0218; Juvenile Welfare Board 0.8117;
SW Florida Water Management District 0.4220; Pinellas Anclote River Basin 0.4000.
128
Schedule 7
City of Clearwater, Florida
Property Tax Levies and Collections
Last Ten Fiscal Years
Collected within the Fiscal
Year of the Levy Total Collections to Date
Collections in
Fiscal Taxes Levied for Percentage Subsequent Percentage
Year the Fiscal Year Amount of Levy Years Amount of Levy
1997 $ 22,410,181 $ 22,281,502 99.43% $ 80,253 $ 22,361,755 99.78%
1998 23,008,214 22,856,951 99.34 129,690 22,986,641 99.91
1999 23,951,878 23,854,396 99.59 226,812 24,081,208 100.54
2000 26,998,318 26,876,461 99.55 106,800 26,983,261 99.94
2001 28,664,112 28,567,429 99.66 77,716 28,645,145 99.93
2002 31,303,900 31,204,025 99.68 130,632 31,334,657 100.10
2003 35,153,114 35,038,555 99.67 91,548 35,130,103 99.93
2004 38,430,718 38,277,689 99.60 94,574 38,372,263 99.85
2005 43,001,524 42,905,336 99.78 124,999 43,030,335 100.07
2006 49,719,539 49,598,439 99.76 118,601 49,717,040 99.99
Note 1: Discounts are allowed for early payment: 4% for November, 3% for December, 2% for January, and 1 % for
February. No discount is allowed for payment in March. Penalties are assessed beginning in April.
Note 2: All delinquent taxes collected are applied to the immediately prior tax year, because the County Tax
Collector does not allocate delinquent taxes collected by the original tax year levied. Consequently, the total
collections-to-date percentage of the tax levy-to-date may be greater than 100% of the tax levy for a given year.
129
Schedule 8a
Taxg_ayer
REAL PROPERTY
Bellweather Prop. LP Ltd.
Clearwater Mall
Sand Key Association Ltd.
Taylor, John S. III
California State Teachers
Weingarten Nostat Inc.
St. Joe Co.
Grand Venezia Baywatch LLC
United Dominion RLTY Trust
ZOM Bayside Arbors Ltd.
Holland Westshore, Inc.
Regency Land Partnership
Walmart Stores, Inc.
Duff, Andrew R. - Trustee
H R E Properties
Branch Sunset Assoc Ltd.
Total
City of Clearwater, Florida
Principal Real Property Taxpayer
Current Year and Nine Years Ag
2006
Percentage of
Total City
Taxable Taxable
Assessed Assessed
Value Rank Value
$ 111,519,300 1 1.37%
43,895,800 2 0.54
35,000,000 3 0.43
34,360,000 4 0.42
32,150,000 5 0.39
29,750,000 6 0.36
27,850,000 7 0.34
25,912,300 8 0.32
25,450,000 9 0.31
25,350,900 10 0.31
$ 391,238,300
Source: Pinellas County Property Appraiser
4.80%
130
s,
0
1997 I,
Percentage of
Total City
Taxable Taxable
Assessed Assessed
Value Rank Value
$ 75,579,400 1 1.93%
19,649,800 5 0.50
30,143,600 4 0.77
18,460,200 6 0.47
240
60
900 2
,
, 1.54
30,365,500 3 0.77
18,143,500 7 0.46
14,573,700 8 0.37
14,506,500 9 0.37
14
321
000 10 0
37
,
, .
$ 295,984,100 7.55%
Schedule 8b
City of Clearwater, Florida
Principal Personal Property Taxpayers,
Current Year and Nine Years Ago
2006 1997
Percentage of Percentage of
Total City Total City
Taxable Taxable Taxable Taxable
Assessed Assessed Assessed Assessed
Taxes
PERSONAL Value Rank Value Value Rank Value
Progress Energy (1) $ 62,479,630 1 12.66% $ 45,472,560 2 9.95%
Verizon Florida Inc (2) 50,406,660 2 10.22 95,278,520 1 20.84
Bright House Networks LLC (3) 14,603,830 3 2.96 8,384,640 3 1.83
Bausch & Lomb Inc 10,368,830 4 2.10
Burdines Inc 4,050,910 5 0.82
General Electric Credit Co 3,996,230 6 0.81
Instrument Transformers 3,902,270 7 0.79 4,997,810 4 1.09
Sheraton Sand Key 3,586,310 8 0.73
Marriott Suites Clearwater 3,477,480 9 0.70
Target Stores 1820 3,242,640 10 0.66
WFTS-TV - - 4,733,870 5 1.04
Clearwater Community Hospital - - 3,873,200 6 0.85
Videotron - - 3,650,810 7 0.8
Storz Ophthalmics, Inc. - - 3,631,240 8 0.79
Aerosonic Corp - - 3,302,860 9 0.72
Aetna Life Insurance Co 2,977,090 10 0.65
Total $ 160,114,790 32.45% $ 176,302,600 38.56%
Notes: (1) Progress Energy was Florida Power in 1 997.
(2) Verizon Florida, Inc. was GTE in 1997.
(3) Bright House Networks was Time Warner Entertainment in 1997.
Source: Pinellas County Property Appraiser
131
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132
Schedule 10
City of Clearwater, Florida
Ratios of General Bonded Debt Outstanding
Last Ten Fiscal Years
(amounts in thousands, except per capita)
General Bonded Debt Outstanding
Percentage of
General Public Service Sales Tax Actual Taxable
Fiscal Obligation Tax Revenue Revenue Value of Per
Year Bonds Bonds Bonds Total Property (a) Capita b
1997 $ 255 $ 11,766 $ - $ 12,021 0.23% $ 117
1998 135 11,233 - 11,368 0.22% 109
1999 - 10,660 - 10,660 0.19% 102
2000 - 10,427 - 10,427 0.18% 96
2001 - 10,179 46,445 56,624 0.92% 518
2002 - 11,360 46,445 57,805 0.86% 527
2003 - 11,005 41,345 52,350 0.73% 476
2004 - 10,645 36,075 46,720 0.59% 423
2005 - 10,270 30,615 40,885 0.47% 369
2006 - 9,885 24,955 34,840 0.34% 315
Note: Details regarding the City's outstanding debt can be found in the notes to the financial statements.
(a) See Schedule 5 for property value data.
(b) Population data can be found in Schedule 14.
133
Schedule 11
City of Clearwater, Florida
Direct and Overlapping Governmental Activities Debt
As of September 30, 2006
(amounts in thousands)
Debt repaid with property taxes
Other debt
Pinellas County Transportation Improvement Revenue Refunding Bonds
Pinellas County Capital Improvement Revenue Bonds
Pinellas County Capital Equipment Revenue Bonds
Pinellas County Capital Leases
Pinellas County School District State Bonds b
Pinellas County School District Capital Leases
Subtotal, overlapping debt
City direct debt
Total direct and overlapping debt
Debt
Outstanding
18,645
59,132
$ 77,777
Sources: Assessed value data used to estimate applicable percentages provided by Pinellas County Property Appraiser.
Debt outstanding data provided by each governmental unit.
Note: Overlapping governments are those that coincide, at least in part, with the geographic boundaries of the city. This
schedule estimates the portion of the outstanding debt of those overlapping governments that is borne by the residents
and businesses of Clearwater. This process recognizes that, when considering the City's ability to issue and repay
long-term debt, the entire debt burden borne by the residents and businesses should be taken into account.
a The percentage of overlapping debt applicable is estimated using taxable assessed property values. Applicable
percentages were estimated by determining the portion of another governmental unit's taxable assessed value that is
within the City's boundaries and dividing it by each unit's total taxable assessed value.
b The School District State Bonds are secured by a pledge of the District's portion of the State-assessed motor vehicle
license tax. The State's full faith and credit is also pledged for the bonds.
Estimated
Estimated Share of
Percentage Overlapping
Applicable'2
Debt
n/a -
6,610 13.8% 909
68,805 13.8% 9,464
15,100 13.8% 2,077
3,018 13.8% 415
38,595 13.8% 5,309
3,418 13.8% 470
134
Schedule 12
City of Clearwater, Florida
Legal Debt Margin Information
Last Ten Fiscal Years
(amounts in thousands)
Total Net Debt
Applicable
Total Net Debt to Limit
Fiscal Debt Applicable Legal as Percentage
Year Limit to Limit Debt Margin of Debt Limit
1997 $ 783,749 $ 112,921 $ 670,828 14.41%
1998 799,897 118,042 681,855 14.76%
1999 830,744 116,410 714,334 14.01%
2000 870,699 121,644 749,055 13.97%
2001 931,415 167,938 763,477 18.03%
2002 1,026,014 254,873 771,141 24.84%
2003 1,116,032 243,518 872,514 21.82%
2004 1,236,804 249,370 987,434 20.16%
2005 1,395,730 236,154 1,159,576 16.92%
2006 1,631,179 247,706 1,383,473 15.19%
Legal Debt M argin Calculation for Fiscal Ye ar 2006•
Assessed valuation of non-exempt real estate $ 8,155,895
Debt Limit (20% of assessed valuation per City Charter) 1,631,179
Debt applicable to limit:
Revenue bonds $ 261,369
Capital leases 12,953
Less: Amount set aside for repayment
of bonded debt (26,616)
247,706
Legal debt margin $ 1,383,473
Note: Per City Charter, the City's indebtedness, to include revenue, refunding, and improvement bonds,
shall not exceed 20 percent of the current assessed valuation of all real property located in the City.
135
Schedule 13
City of Clearwater, Florida
Pledged-Revenue Coverage
Last Ten Fiscal Years (a)
(amounts in thousands)
Page 1 of 2
Less: Net
Fiscal Gross Operating Available Debt S ervice
YM Revenues Expenses Revenues Pri
cb> ncipal Interest C overage
Infrastructure Sales Tax Bonds
2001 $ 8,340 $ - $ 8,340 $ - $ - n/a
2002 8,458 - 8,458 - 1,984 4.26
2003 8,662 - 8,662 5,100 1,882 1.24
2004 9,120 - 9,120 5,270 1,674 1.31
2005 9,978 - 9,978 5,460 1,432 1.45
2006 10,704 - 10,704 5,660 1,896 1.42
Spring Training Facility Bonds M
2002 $ 1,148 $ - $ 1,148 $ - $ - n/a
2003 1,115 - 1,115 165 629 1.40
2004 1,086 - 1,086 460 623 1.00
2005 1,098 - 1,098 465 614 1.02
2006 1,107 - 1,107 475 603 1.03
Public Service Tax/Improvement Revenue Bonds (d)
1997 $ 13,557 $ - $ 13,557 $ 495 $ 734 11.03
1998 14,630 - 14,630 535 696 11.88
1999 15,238 - 15,238 575 656 12.38
2000 15,243 - 15,243 235 634 17.54
2001 15,486 - 15,486 250 613 17.94
2002 18,273 - 18,273 110 408 35.28
2003 17,381 - 17,381 355 506 20.19
2004 17,027 - 17,027 360 496 19.89
2005 17,493 - 17,493 375 485 20.34
2006 18,118 - 18,118 385 473 21.12
(e)
Less than ten years of coverage are provided for the Infrastructure Sales Tax Revenue Bonds
issued June 2001 and the Spring Training Facility Bonds issued Septembe r 2002.
(b)
Pledged revenues for the Infrastructure Sales Tax Revenue Bonds include the City's share of
revenu es derived by Pinellas County, Florida, from the levy and collection of a one-cent
discretionary infrastructure sales surtax pursuant to Section 212.055(2), Florida Statutes, as
amended. Interest for 2006 includes arbitrage rebate of $742,000.
(`) Pledged revenues for the Spring Training Facility Revenue Bonds include payments received
from the State of Florida pursuant to Section 212.20, Florida Statutes, and payments from
Pinellas County, pursuant to an inter-local agreement dated December 1, 2000, along with
related interest earnings.
(d) Pledged revenues for the Improvement Revenue Refunding Bonds, issued October 2001, were
public service taxes. Effective October 1, 2001, the Florida Legislature repealed the public tax
on communications and created a replacement communications services tax. Consequently
the pledged revenues effective October 1, 2001, include both public service taxes and the new
communications services taxes.
136
Schedule 13 (continued)
City of Clearwater, Florida
Pledged-Revenue Coverage
Last Ten Fiscal Years (a)
(amounts in thousands)
Page 2 of 2
Less: Net
Fiscal Gross Operating Available Debt Service Maximum
Year Revenues Expenses Revenues Principal Interest Coverage Coverage (b?
Water & Sewer Utility Revenue Bonds
1997 $ 35,816 $ 23,418 $ 12,398 $ 4,140 $ 3,039 1.73
1998 36,311 24,608 11,703 4,305 2,870 1.63
1999 35,851 24,806 11,045 4,500 2,083 1.68
2000 37,407 25,883 11,524 4,705 1,581 1.83
2001 39,486 27,337 12,149 4,920 1,359 1.93
2002 39,452 28,552 10,900 5,165 1,118 1.73
2003 40,243 29,611 10,632 5,430 3,334 1.21
2004 44,193 31,206 12,987 6,575 2,964 1.36
2005 46,379 32,243 14,136 7,000 2,892 1.43
2006 51,197 36,546 14,651 7,020 2,711 1.51
Gas Utility Revenue Bonds
1997 $ 17,780 $ 14,124 $ 3,656 $ 320 $ 1,455 2.06 2.06
1998 19,438 14,975 4,463 455 1,379 2.43 2.05
1999 18,772 14,702 4,070 540 1,565 1.93 1.87
2000 21,533 16,463 5,070 560 1,543 2.41 2.33
2001 31,212 24,575 6,637 580 1,519 3.16 3.05
2002 27,218 20,665 6,553 610 1,495 3.11 3.01
2003 30,373 23,729 6,644 630 1,470 3.16 3.05
2004 33,229 26,316 6,913 675 1,370 3.38 3.18
2005 37,797 30,584 7,213 770 1,228 3.61 3.35
2006 43,772 34,154 9,618 825 1,192 4.77 4.47
Stormwater Uti lity Revenue Bonds
2000 $ 4,938 $ 3,183 $ 1,755 $ - $ 185 9.49
2001 5,323 3,608 1,715 105 400 3.40
2002 6,846 3,958 2,888 120 395 5.61
2003 8,660 4,727 3,933 125 1,104 3.20
2004 9,680 5,923 3,757 570 1,445 1.86
2005 10,523 5,754 4,769 580 1,830 1.98
2006 11,589 6,020 5,569 925 1,897 1.97
During November 1999 the City issued $7,500,000 of Stormwater System Revenue Bonds,
consequently less than ten years of coverage are provided.
(b) Maximum debt service coverage is presented for continuing disclosure on the Gas System
Revenue Bonds and is based upon the maximum annual debt service for outstanding bonds
and parity bonds.
137
Schedule 14
City of Clearwater, Florida
Demographic and Economic Statistics
Last Ten Fiscal Years
Personal Income Per Capita
(thousands of Personal Median School Unemployment
Year Population (a) dollars) Income (b) Age (c) Enrollment (d) Rate (e)
1997 102,874 $ 2,556,316 $ 24,849 43.3 15,264 3.7%
1998 104,281 2,918,408 27,986 43.6 13,714 2.9%
1999 104,454 2,852,116 27,305 43.9 14,551 3.0%
2000 108,787 3,134,480 28,813 44.2 15,978 2.7%
2001 109,231 3,238,590 29,649 43.0 16,293 2.7%
2002 109,719 3,487,309 31,784 43.0 17,047 3.9%
2003 110,055 3,586,692 32,590 43.9 16,295 5.4%
2004 110,325 3,680,552 33,361 44.0 16,323 4.7%
2005 110,831 3,727,357 33,631 44.2 15,964 3.7%
2006 110,602 3,938,205 35,607 44.2 15,696 3.2%
(a)
Source is the University of Florida, Bureau of Economic and Business Research:
April 1, 2006 estimate for current year and Florida Statistical Abstract for prior years.
(b) Data is from per capital personal income for Pinellas County for two years prior.
Source is the University of Florida, Bureau of Economic and Business Research,
Florida Statistical Abstract.
(c) Data is for Pinellas County for prior year. Source is the University of Florida, Bureau
of Economic and Business Research, Florida Statistical Abstract.
(d) Source of data is the Pinellas County School District.
(e) Source for fiscal years 1997 thru 2005 is the University of Florida, Bureau of
Economic and Business Research, Florida Statistical Abstract, as of December 31 st
of the indicated fiscal year. Source for fiscal 2006 is the US Dept of Labor, Bureau of
Labor Statistics, Tampa Metro Area as of September 2006.
Note: Data is the latest published annual data available for an unspecified point in each
year, not specifically September 30.
138
Schedule 15
City of Clearwater, Florida
Principal Employerse,
Current Year and Nine Years Ago
2006 b 1997
Percentage Percentage
of Total of Total
County County
Employer Employees Rank Employment Employees Rank Employment
Pinellas County School District
Pinellas County Government d
Nielsen Media Research
St Petersburg City
Times Publishing
Raymond James
Bay Pines VA Medical Center
Morton Plant Hospital
Home Shopping Network
All Childrens Hospital
Tech Data
Jack Eckerd Corp.
Florida Progress
17,658 1 3.67%
7,378 2 1.54%
3,510 3 0.73%
3,420 4 0.71%
3,187 5 0.66%
2,850 6 0.59%
2,759 7 0.57%
2,439 8 0.51%
2,439 9 0.51%
2,319 10 0.48%
15,497 1 3.56%
3,583 2 0.82%
2,600 9 0.60%
2,743 8 0.63%
3,000 7 0.69%
2,200 10 0.50%
3,500 4 0.80%
3,500 3 0.80%
3,375 5 0.77%
3,000 6 0.69%
Total Employment b,c
480,647
435,715
e Data is for Pinellas County. City data is not available.
b Source: Pinellas County, FY 2006-2007 Annual Operating and Capital Budget, Pinellas County Clerk Annual Budget
FY 2005-2006. and Pinellas County Department of Economic Development.
a Source: 1996-1997 Pinellas Journal of Commerce & Industry and Pinellas County FY 1996-1997 Annual Operating
and Capital Budget.
d Includes part-time personnel budgeted.
139
Schedule 16
City of Clearwater, Florida
Full-time Equivalent City Government Employees by Function/Program
Last Ten Fiscal Years
General government
Public safety
Fire
Police
Physical environment
Transportation
Economic environment
Human services
Culture and recreation
Library
Parks & Rec
Water & Sewer Utility
Gas Utility
Solid Waste Utility
Stormwater Utility
Recycling
Marine
Aviation
Parking System
Total
Full-time Equivalent Emp loyees as of September 30 ,
1997 1998 1999 2444 2QU 2492 244 200 244 269-
267.7 293.3 289.9 291.9 293.4 301.9 287.0 286.4 287.3 307.5
170
0 170
0 171
5 180
5 186
. . . . .5 199.7 200.0 202.0 202.0 215.0
393.2 393.8 399.4 411.0 408.4 408.4 397.6 399.9 405.9 407.9
31.0 30.0 33.0 33.0 34.0 36.0 36.0 36.0 36.0 38.0 ,
63.0 61.0 65.0 65.0 67.0 72.0 73.0 73.0 71.0 75
0
31
0 2 .
. 9.0 41.0 47.0 52.0 52.3 64.3 67.3 67.1 69.5
9.0 9.0 9.0 10.0 4.0 4.0 4.0 4.0 3.0 3.0
80.9 84.4 83.3 79.0 80.4 81.4 83.4 95.9 95.9 94.9
195.9 191.6 194.9 203.0 207.8 209.6 217.0 241.9 235.4 239.8
153.0 155.0 154.0 154.8 158.0 166.0 170.0 169.0 169.0 175.0
96.0 95.0 95.0 95.0 91.0 90.0 90.0 90.0 90.0 90.0
102.0 104.0 105.0 108.0 108.5 109.5 106.0 107.5 109.5 112.0
29.0 28.0 32.0 36.2 38.0 38.0 40.0 40.0 46.0 46.0
21.0 21.0 23.0 23.0 24.5 24.5 23.5 23.5 23.5 22.5 ,
29.8 29.8 29.8 30.8 30.8 32.8 35.9 35.9 36.4 32.6
- - - - 2
0 1
0 2
4 2
4 1
9 1
9
. . . . . .
9.9 9.9 9.7 9.6 9.6 9.6 14.8 20.8 20.8 20.8
1,682.4 1,704.8 1,735.5 1,777.8 1,795.9 1,836.7 1,844.9 1,895.5 1,900.7 1,951.4
Source: City of Clearwater Office of Management and Budget
140
Schedule 17
City of Clearwater, Florida
Operating Indicators by Function/Program
Last Three Fiscal Years*
Fiscal Year Ended Sept 30:
2004 2005 2006
Function/Program
General government
Planning
Commercial building permits issued 1,861 1,804 2,182
Residential building permits issued 6,348 7,359 6,328
Public safety
Police
Average officer Training Hours 141 a 150 a 60
Total Volunteer Training Hours 1,229 1,017 1,200
Fire
Fire Prevention Training Programs for Citizens 223 249 204
Number of Citizens Trained 9,720 11,566 5,115
Physical environment
Square feet of sidewalks repaired/constructed 53,528 37,039 50,200
Transportation
Miles of roadway resurfaced 13 12 15
Economic environment
Code enforcement cases brought to compliance 9,439 8,701 11,535
Human services
City employees that mentor in area schools 28 30 31
Culture and recreation
Library system
Library visits 854,004 975,547 1,000,000
Circulation 1,164,424 1,190,577 1,190,000
Parks and recreation
Recreation center visitations 1,098,407 1,106,216 1,250,000
Athletic program visitations 266,276 511,620 550,000
Water and Sewer Utility
Water customers 40,235 40,178 40,467
Volume of water pumped (million gallons/day) 13.15 14.18 14.09
Sewer customers 33,234 33,305 33,279
Miles of sewers cleaned 168 169 166
Gas Utility
Number of meters 16,452 16,464 16,908
Solid Waste Utility
Solid waste tonnage collected and disposed 130,914 128,080 135,000
Stormwater Utility
Number of equivalent residential units 98,621 97,669 97,297
Recycling Utility
Marketable tons recycled 14,443 14,324 14,400
* Note: Only three years of data are available. Fiscal 2006 is estimated if not available. No operating
indicators are available for marine, aviation, parking, and Harborview Center functions.
a Training hours for fiscal 2004 and 2005 included grant-funded training for Homeland Security.
141
Schedule 18
City of Clearwater, Fl orida
Capital Asset Statistics by Function/Program
Last Ten Fiscal Years ,
As of September 30 ,
m 1998 ]; 2994 2491 2492 2993 2994 299;: 294li
Function/Program
Public safety
Fire
Stations 6 6 6 6 7 7 7 8 8 8
Police
Stations 8 8 8 8 8 9 9 9 10 10
Transportation
Paved streets (miles) 302 304 304 304 304 304 304 305 305 305 ,
Culture and recreation
Library system
Volumes in collection (thousands) 419 443 466 497 534 546 557 557 570 565
Parks and recreation
Parks acreage 1,069 1,069 1,069 1,126 1,130 1,130 1,130 1,130 1,134 1,160
Recreational paths (miles) 6 6 6 7 7 7 7 7 13 14
Playgrounds 29 30 30 30 31 31 31 31 32 33
Baseball and softball fields 35 35 37 37 36 36 36 35 35 35
Soccer and football fields 17 17 17 20 17 17 17 17 24 25
Recreation centers 9 9 9 10 10 11 12 12 7 7
Water & Sewer Utility
Water mains (miles) 519 519 521 522 523 559 559 567 567 568
Sanitary sewer mains (miles) 322 322 322 323 322 363 363 363 363 365
Daily treatment capacity (millions of gallons) 29 29 29 29 29 29 29 29 29 29
Gas Utility
Gas mains (miles) 579 606 621 631 653 669 686 729 753 786
Stormwater Utility
Stormwater mains (miles) 120 121 123 123 123 147 147 147 147 148
Marine
Boat slips 209 209 210 209 209 209 209 209 209 209
Aviation
Airpark spaces 174 174 174 174 174 177 177 177 177 177
Parking system i
Parking spaces 3,527 3,858 3,786 3,773 3,753 3,538 3,615 3,653 3,686 3,636
S
V
i
it
d
ources:
ar
ous c
y
epartments
Note: No capital asset indicators are available for th e general government, physical environment, economic environme nt,
human services, solid waste, recycling, and Harborview Center functions.
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Grants Compliance
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INDEPENDENT AUDITORS' REPORT ON INTERNAL CONTROL OVER
FINANCIAL REPORTING AND ON COMPLIANCE AND OTHER MATTERS
BASED ON AN AUDIT OF FINANCIAL STATEMENTS PERFORMED IN
ACCORDANCE WITH GO VERNMENT AUDITING STANDARDS
Honorable Mayor, City Councilmembers,
City Manager and City Management
City of Clearwater. Florida
We have audited the financial statements of the governmental activities, the business-type activities, each
major fund, and the aggregate fund information of the City of Clearwater, Florida (the "City") as of and
for the year ended September 30, 2006, which collectively comprise the City's basic financial statements,
and have issued our report thereon dated March 26, 2007. We have also audited the financial statements
of each of the City's non-major governmental and non-major enterpri se. internal service, and fiduciary
funds presented as supplemental information in the accompanying combining and individual fund
financial statements. 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.
Internal Control Over Financial Reporting
In planning and performing our audit, we considered the City's internal control over financial reporting in
order to determine our auditing procedures for the purpose of expressing our opinions on the financial
statements and not to provide an opinion on the internal control over financial reporting. Our
consideration of the internal control over financial reporting would not necessarily disclose all matters in
the internal control over financial reporting that might be material weaknesses. A material weakness is a
reportable condition in which the design or operation of one or more of the internal control components
does not reduce to a relatively low level the risk that misstatements caused by error or fraud in amounts
that would be material in relation to the financial statements being audited may occur and not be detected
within a timely period by employees in the normal course of performing their assigned functions. We
noted no matters involving the internal control over financial reporting and its operation that we consider
to be material weaknesses.
Compliance and Other Matters
As part of obtaining reasonable assurance about whether the City's basic financial statements are free of
material misstatement, we performed tests of its compliance with certain provisions of laws, regulations,
contracts and grant agreements, noncompliance with which could have a direct and material effect on the
determination of financial statement amounts. However, providing an opinion on compliance with those
provisions was not an objective of our audit and, accordingly, we do not express such an opinion. The
results of our tests disclosed no instances of noncompliance or other matters that are required to be
reported under Government Auditing Standards.
145
This report is intended solely for the information and use of the City Mayor, City Councilmembers, City
Manager, management, the State of Florida Office of the Auditor General and applicable federal and state
agencies and is not intended to be and should not be used by anyone other than these specified parties.
.' 41.140
St. Petersburg, Florida
March 26, 2007
146
INDEPENDENT AUDITORS' REPORT ON C0ti4PLIANCE
WITH REQUIREIN1ENTS APPLICABLE TO EACH MAJOR FEDERAL AWARDS
PROGRAM AND STATE FINANCIAL ASSISTANCE PROJECTS AND INTERNAL CONTROL
OVER COMPLIANCE IN ACCORDANCE WITH OMB CIRCULAR A-133 AND CHAPTER
1 10.550, RULES OF AUDITOR GENERAL
Honorable Mayor. City Councilmembers,
' City Manager and City Management
City of Clearwater, Florida
' Compliance
We have audited the compliance of the City of Clearwater, Florida (the "City") with the types of
compliance requirements described in the U.S. Office of Management and Budget (OMB) Circular A-133
Compliance Supplement, and the requirements described in the Executive Office of the Governor's State
Projects Compliance Supplement, that are applicable to each of its major federal programs and state
financial assistance projects for the year ended September 30, 2006. The City's major federal programs
1 and state financial assistance projects are identified in the summary of auditor's results section of the
accompanying Schedule of Findings and Questioned Costs. Compliance with the requirements of laws,
regulations. contracts and grants applicable to its major federal programs and state financial assistance
1 projects is the responsibility of the City's management. Our responsibility is to express an opinion on the
City's compliance based on our audit.
We conducted our audit of compliance in accordance with auditing standards generally accepted in the
United States of America; the standards applicable to financial audits contained in Government Auditing
Standards, issued by the Comptroller General of the United States; OMB Circular A-133, Audits of
States, Local Governments, and Non-Profit Organizations and Chapter 10.550. Rules of the Auditor
General. Those standards. OMB Circular A-133, and Chapter 10.550. Rules of the Auditor General,
require that we plan and perform the audit to obtain reasonable assurance about whether noncompliance
with the types of compliance requirements referred to above that could have a direct and material effect
on a major federal program and state financial assistance project occurred. An audit includes examining,
on a test basis, evidence about the City's compliance with those requirements and performing such other
procedures as we considered necessary in the circumstances. We believe that our audit provides a
reasonable basis for our opinion. Our audit does not provide a legal determination on the City's
compliance with those requirements.
In our opinion, the City complied, in all material respects, with the requirements referred to above that are
applicable to its major federal programs and state financial assistance projects for the year ended
September 30. 2006.
1
1 147
Internal Control Over Compliance '
The City's management is responsible for establishing and maintaining effective internal control over
compliance with requirements of laws, regulations, contracts and grants applicable to federal programs '
and state financial assistance projects. In planning and performing our audit, we considered the City's
internal control over compliance with requirements that could have a direct and material effect on a mayor
federal program or state financial assistance project in order to determine our auditing procedures for the
purpose of expressing our opinion on compliance and to test and report on internal control over '
compliance in accordance with OMB Circular A-133 and Chapter 10.550, Rules of the Auditor General.
Our consideration of the internal control over compliance would not necessarily disclose all of the matters
in internal control that might be material weaknesses. A material weakness is a condition in which the
design or operation of one or more of the internal control components does not reduce to a relatively low
level the risk that noncompliance with applicable requirements of laws, regulations, contracts and grants ,
caused by error or fraud that would be material in relation to a major federal program being audited may
occur and not be detected within a timely period by employees in the normal course of performing their
assigned functions. We noted no matters involving the internal control over compliance and its operation
that we consider to be material weaknesses.
This report is intended solely for the information and use of the City Mayor, City Councilmembers, City
Manager, management, the State of Florida Office of the Auditor General and applicable federal and state
agencies and is not intended to be and should not be used by anyone other than these specified parties.
I64+nax"4 1L ,44wX,70,
St. Petersburg, Florida
March 26, 2007
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City of Clearwater, Florida
Schedule of Expenditures of Federal Awards
and State Financial Assistance
For the year ended September 30, 2006
Federal Grantor/ Federal
Pass-through Grantor / CFDA Share of
Program Title Number Grant I.D. Number Expenditures
FEDERAL AWARDS
U.S. Department of Housing and Urban Development:
Community Development Block Grant - Entitlement
Home Investment Partnerships Program
Beach by Design Initiative
Beach by Design Initiative
Total U.S. Department of Housina and Urban Development
U.S. Department of the Interior:
Passed thru Florida Department of Environmental Protection
Fish and Wildlife Service
Clean Vessel Act - Pumpout Vessel
National Park Service
Myron Smith Bayview Park
14.218 B-01-MC-12-0002
14.239 M-01-MC-12-0230
14.246 B-03-SP-FL-0141
14.246 B-04-SP-FL-0172
14.246
15.616 LE591
15.916 LW 12-00515
16.000
$ 896,450
1,393,456
201,184
447,345
648,529
2,938,435
Total U.S. Department of the Interior
U.S. Department of Justice:
Federal Forfeiture Sharing
Bureau of Justice Assistance
Operacion Apoyo Hispano
Total U.S. Department of Justice
U.S. Department of Transportation:
Federal Highway Administration
Passed thru Florida Department of Transportation:
Clearwater Beach West Bridge Connector
McMullen Booth Road Overpass - Construction
Druid Trail Design & Construction
Beach Walk
National Highway Traffic Safety Administration
National Strategies for Advancing Bicycle Safety
Total U.S. Department of Transportation
16.738 2005-DJ-BX-0950
29,625
163,135
192,760
29,807
36,585
66,392
20.205 Fed No. 9045-019C,Contract *AI 915 340,460
20.205 FPN 40625915801, Contract #ANJ75 15,744
20.205 FPN 415277-1-38-01 200,416
20.205 FPN 416652-1-28-01 126,300
20.205 682,920
20.614 DTNH22-04-H-05090
50,000
732,920
149
City of Clearwater, Florida
Schedule of Expenditures of Federal Awards
and State Financial Assistance - Continued
For the year ended September 30, 2006 '
Federal Grantor/
Pass-through Grantor/
Program Title
FEDERAL AWARDS (continued)
U.S. Environmental Protection Agency:
Seville/Sunset Point & Del Oro Reclaimed water expansion
Brownfield - Federal
Brownfields Assessment and Cleanup Cooperative Agreements
Passed through FL Department of Environmental Protection:
Kapok Wetland & Floodplain Restoration Project
Total U.S. Environmental Protection Agency
Corporation For National and Community Services:
Passed through FL Commission on Community Services
Americorps Clearwater Program
Americorps Clearwater 2006
Total Corporation for National and Community Services
U.S. Department of Homeland Security:
Urban Areas Security Initiative
Passed thru City of Tampa, Florida
Planning & Preparedness Coordinator
Assistance to Firefighters Grant
Operations and Firefighter Safety
Total U.S. Department of Homeland Security
Total Federal Financial Assistance
150
Federal
CFDA/CSFA Share of
Number
Grant I.D. Number
Expenditures '
66
202 XP-97495304
. 498,995
66.811 BF-9840503096-0 101,717
66.818
BF-97493703-0
113,033 ,
66.460 C9-9945-1503-0; FDEP G0087 450,000
1,163,745
,
94.006 Contract 04AC045391 21,509
94.006 Contract 05AC051059 95,473
116,982
97.008 UASI 77,000
97.044 2004-57-0364RE-63000000-41 01 -R 53,105 '
130
105 '
,
'
$ 5,341,339
City of Clearwater, Florida
Schedule of Expenditures of Federal Awards
' and State Financial Assistance - Continued
For the year ended September 30, 2006
' State Grantor/
Pass-through Grantor/
Program Title
STATE FINANCIAL ASSISTANCE
Florida Executive Office of the Governor
Office of Tourism, Trade, and Economic Development:
Brownfield Grant
' Total Florida Executive Office of the Governor
Florida Department of Environmental Protection:
Florida Recreation Development Assistance Program
Long Center Limitless Playground
Ross Norton Complex
Glen Oaks Stormwater Improvements
Passed thru Southwest Florida Water Management District
Surface Water Improvement & Management (SWIM) Plan
State
CSFA Share of Transfers to
Number Grant I.D. Number Expenditures (a) Subrecipients (b)
31.011 V 984053-96-0 $ 22,830 $
22,830 -
37.017 DEP Agreement #F6115
37.017 DEP 5046
37.017
37.039 WAP050
200,000
200,000
400,000
1,175,007
02CON00065 W250 98,056
1,273,063 -
1,673,063 -
Kapok Wetland & Floodplain 37.039
37.039
Total Florida Department of Environmental Protection
Florida Department of Community Affairs:
Florida Housing Finance Corporation
State Housing Initiative Partnership Program (SHIP)
Total Florida Department of Community Affairs
Florida Department of Transportation:
Airpark FBO Building
Airpark FBO Building
'J
Drew Street & US19 Overpass Landscaping
Memorial Causeway Landscape Beautification
SR595/Alt US19 Drew to Monroe Street Resurfacing
Total Florida Department of Transportation
Florida Department of Law Enforcement:
Violent Crime Investigative Emergencies
Total Florida Department of Law Enforcement
Florida Department of Revenue:
Phillies Stadium
Total Florida Department of Revenue
Florida Fish and Wildlife Conservation Commission:
Clearwater Municipal Marina
High & Dry Marina Multi-Site Feasibility Study
Total Florida Fish and Wildlife Conservation Commission
' Total State Financial Assistance
Total Expenditures of Federal Awards
and State Financial Assistance
(a) Funded with State grants and aids appropriations.
(b) State projects only.
52.901 n/a
55.004 41243119401 ANW13
55.004 41230819401 AOC90
55.004
55.008 FO#256957-1-54-01
1,219,040 45,980
1,219,040 45,980
202,800
11,750
214,550
110,072
55.023 FP#257093-1-54-01 235,214
55.023 FPN 257103-1-58-01 26,094
55.023 261,308
585,930 -
71.005 Appr. Category 109701
73.016
77.006 FWC 04139
77.006 FWC 05101
151
4,996
4,996 -
1,077,993
1,077,993 -
48,750
27,402
76,152 -
$ 4,660,004 $ 45,980
$ 10,001,343
City of Clearwater, Florida
NOTES TO SCHEDULE OF EXPENDITURES OF FEDERAL AWARDS
AND STATE FINANCIAL ASSISTANCE
Year ended September 30, 2006
NOTE 1 - BASIS OF PRESENTATION
The accompanying schedule of expenditures of federal awards and state financial assistance presents
the activity of all federal financial and state grant activity of the City of Clearwater, Florida (the "City").
Federal and state financial assistance received directly from federal and state agencies, and federal
financial assistance passed through other governmental agencies are included on the schedules. The
information in this schedule is presented in accordance with the requirements of OMB Circular A-133,
Audits of States, Local Governments and Non-Profit Organizations and Chapter 10.550, Rules of the
Auditor General.
NOTE 2 - BASIS OF ACCOUNTING
The accompanying Schedule of Expenditures of Federal Awards and State Financial Assistance is
presented using the modified accrual or accrual basis of accounting, which is described in Note 1 to the
City's basic financial statements.
NOTE 3 - CFDA/CSFA NUMBER
CFDA numbers represent Catalog of Federal Domestic Assistance and apply only to federal awards.
CSFA numbers represent Catalog of State Financial Assistance and apply only to state financial
assistance.
152
CITY OF CLEARWATER, FLORIDA
Schedule of Findings and Questioned Costs
Year Ended September 30, 2006
SECTION I. Summary of Auditor's Results
Financial Statements
Type of auditor's report issued: Unqualified
Internal control over financial reporting:
- Material weakness(es) identified Yes X No
- Reportable conditions(s) identified
that are not considered to be
material weaknesses Yes X None reported
Noncompliance material to financial
statements noted Yes X No
Federal Awards
Internal control over major federal programs:
- Material weakness(es) identified Yes X No
- Reportable conditions(s) identified
that are not considered to be
material weaknesses Yes X None reported
Noncompliance material to federal
awards Yes X No
Type of auditor's report issued on compliance for major federal programs: Unqualified
Any audit findings disclosed that are
required to be reported in accordance
with Section 510(a) of Circular A-133 Yes X No
Identification of major federal programs:
CFDA Number(s) Name of Federal Program or Cluster
14.218 Community Development Block Grant - Entitlement
14.239 Home Investment Partnerships Program
14.246 Beach by Design Initiative
66.460 Kapok Wetland & Floodplain Restoration Project
' Dollar threshold used to distinguish between Type A and Type B Programs $ 300.000
Auditee qualified as low-risk auditee? X Yes No
1 153
CITY OF CLEARWATER, FLORIDA
Schedule of Findings and Questioned Costs
Year Ended September 30, 2006
State Proiccts
Internal control over major State projects:
- Material weakness(es) identified Yes X No
- Reportable conditions(s) identified
that are not considered to be
material weaknesses Yes X None reported
Noncompliance material to State awards Yes X No
Type of auditor's report issued on compliance for major State projects: Unqualified
Any audit findings disclosed that are
required to be reported in accordance
with Chapter 10.550, Rules of the
Auditor General Yes X No
Identification of major State projects:
CSFA Number(s) Name of State Project
37.017 Florida Recreation Development Assistance Program
73.016 Phillies Stadium
Dollar threshold used to distinguish between Type A and Type B Programs 300,000
SECTION Ii. Financial Statement Findings
None reported.
SECTION III. Federal Award Findings and Questioned Costs
None reported.
SECTION IV. State Award Findings and Questioned Costs
None reported.
154
INDEPENDENT AUDITORS' INIANAGEVIENT LETTER
Honorable Mayor, City Councilmembers,
City Manager and City Management
' City of Clearwater, Florida
We have audited the financial statements of the City of Clearwater (the "City"), as of and for the year
' ended September 30, 2006, and have issued our report thereon dated March 26, 2007.
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. We have issued our Independent Auditors'
Report on Internal Control over Financial Reporting and on Compliance and Other Matters Based on an
Audit of Financial Statements Performed in Accordance with Government Auditing Standards,
' Independent Auditors' Report on Compliance with Requirements Applicable to each Major Federal
Awards Program and State Financial Assistance Projects and Internal Control over Compliance in
accordance with OMB Circular A-133 and Chapter 10.550, Rules of the Auditor General, and Schedule of
Findings and Questioned Costs. Disclosures in those reports and schedule, which are dated March 26,
2007, should be considered in conjunction with this management letter.
Additionally, our audit was conducted in accordance with Chapter 10.550, Rules of the Auditor General.
Those rules (Section 10.554(1)(h)l) require that we address in the management letter, if not already
addressed in the auditors' reports on internal controls over financial reporting and on compliance and
other matters or on the schedule of findings and questioned costs, whether or not corrective actions have
' been taken to address significant findings and recommendations made in the preceding annual financial
audit report. There were no significant findings or recommendations made in the preceding annual
financial audit report.
' The Rules of the Auditor General (Section 10.554(1)(h)2) state that a management letter shall have a
statement as to whether or not the City complied with Section 218.415, Florida Statutes, regarding the
investment of public funds. In connection with our audit of the financial statements of the City, the
' results of our tests did not indicate that the City was in noncompliance with Section 218.415 regarding the
investment of public funds.
The Rules of the Auditor General (Section 10.554(1)(h)3) require disclosure in the management letter of
any recommendations to improve the City's management, accounting procedures, and internal controls.
There were no such matters reported.
' The Rules of the Auditor General (Section 10.554(l)(h)4) require disclosure in the management letter of
the following matters if not clearly inconsequential, considering both quantitative and qualitative factors:
(1) violations of laws, rules, regulations, and contractual provisions that have occurred, or are likely to
' have occurred; (2) improper or illegal expenditures; (3) improper or inadequate accounting procedures
(e.g., the omission of required disclosures from the financial statements); (4) failures to properly record
financial transactions; and (5) other inaccuracies, shortages. defalcations, and instances of fraud
discovered by. or that come to the attention of, the auditor. There were no such matters found
1 155
The Rules of the Auditor General (Section 10.554(1)(h)5) also require that the name or official title and
legal authority for the primary government and each component unit of the reporting entity be disclosed
in the management letter, unless disclosed in the notes to the financial statements. The City of '
Clearwater, located in Pinellas County, Florida was incorporated in June 1923. The legal authority by
which the City was created and is governed is its charter, which was derived from Chapter 9710 Special
Laws of Florida, as amended. The Clearwater Redevelopment Agency (CRA), a blended component unit
of the City of Clearwater, Florida, was created by authority of Florida Statute Chapter 163, Part III, and
the City of Clearwater Resolution 81.68.
As required by the Rules of the Auditor General (Section 10.554(1)(h)6.a.), the scope of our audit '
included a review of the provisions of Section 218.503(1), Florida Statutes, regarding financial
emergencies. In connection with our audit of the financial statements of the City, the results of our tests
did not indicate that the City met any of the specified conditions of a financial emergency contained in '
Section 218.503(1), Florida Statutes. However, our audit does not provide a legal determination on the
City's compliance with this requirement.
The Rules of the Auditor General (Section 10.554(1)(h)6.b.) state that a management letter shall include a '
statement as to whether or not the financial report filed with the Florida Department of Financial Services,
pursuant to Section 218.32(l)(a), Florida Statutes, is in agreement with the annual financial audit report
for the current audit period and, if not, explanations of any significant differences. In connection with our '
audit of the City, the results of our tests indicate that the financial report, filed with the Department of
Financial Services, is in agreement with the annual audited financial statements for the year ended
September 30, 2006. '
As required by the Rules of the Auditor General (Sections 10.554(1)(h)6.c. and 10.556), the scope of our
audit included financial condition assessment procedures as of September 30, 2006. It is management's
'
responsibility to monitor the entity
s financial condition, and our financial condition assessment was ,
based in part on representations made by management and the review of financial information provided
by management. The results of our financial condition assessment procedures disclosed no deteriorating
financial conditions. '
This report is intended solely for the information and use of the City Mayor, City Councilmembers, City
Manager, management, the State of Florida Office of the Auditor General and applicable federal and state
agencies, and is not intended to be and should not be used by anyone other than those specified parties. ,
We would like to thank the City for the courtesy and assistance extended to us by the staff during our
engagement. Should you have any questions concerning the matters discussed herein, we shall be pleased '
to discuss them with you at your convenience.
St. Petersburg, Florida
March 26, 2007 '
156