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06/12/2023Monday, June 12, 2023 1:00 PM City of Clearwater Main Library - Council Chambers 100 N. Osceola Avenue Clearwater, FL 33755 Main Library - Council Chambers Community Redevelopment Agency Meeting Agenda June 12, 2023Community Redevelopment Agency Meeting Agenda Welcome. We are glad to have you join us. If you wish to address the Council, please complete a Comment Card. Comment Cards are on the right-hand side of the dais by the City Clerk. When recognized, please hand your card to the Clerk, approach the podium and state your name. Persons speaking before the City Council shall be limited to 3 minutes unless otherwise noted under Public Hearings. For other than "Citizens to be heard regarding items not on the Agenda," a spokesperson for a group may speak for 3 minutes plus an additional minute for each person in the audience that waives their right to speak, up to a maximum of 10 minutes. Prior to the item being presented, please obtain the form to designate a spokesperson from the City Clerk. Up to 60 minutes of public comment will be allowed for an agenda item. No person shall speak more than once on the same subject unless granted permission by the City Council. The City of Clearwater strongly supports and fully complies with the Americans with Disabilities Act (ADA). Please advise us at least 48 hours prior to the meeting if you require special accommodations at 727-562-4090. Assisted Listening Devices are available. Kindly refrain from using cell phones and electronic devices during the meeting. Citizens wishing to provide comments on an agenda item are encouraged to do so in advance through written comment. The City has established the following two options: 1) eComments via Granicus - eComments is integrated with the published meeting agenda. Individuals may review the agenda item details and indicate their position on the item. You will be prompted to set up a user profile to allow you to comment, which will become part of the official public record. The eComment period is open from the time the agenda is published. All comments received by 5:00 p.m. the day before the meeting (June 11) will become part of the official record. 2) Email – Individuals may submit written comments or videos to ClearwaterCRA@myclearwater.com. All comments received by 5:00 p.m. the day before the meeting (June 11) will become part of the official record. 1. Call To Order 2. Approval of Minutes 2.1 Approve the minutes of the April 17, 2023 CRA Meeting as submitted in written summation by the City Clerk. 3. Citizens to be Heard Regarding Items Not on the Agenda 4. New Business Items 4.1 Approve the 2022 Annual Financial Report. 4.2 Approve an allocation of $65,000 to fund art installations within The Mercado. 4.3 Approve Downtown Gateway Business Economic Recovery Grant Program. 4.4 Approve Restaurant Operations: Essential Equipment Micro-Grant Program. Page 2 City of Clearwater Printed on 6/6/2023 June 12, 2023Community Redevelopment Agency Meeting Agenda 4.5 Approve Façade and Interior Improvement Grant Program. 4.6 Approve additional FTE to CRA for Fiscal Year 22/23. 5. Director's Report 6. Adjourn Page 3 City of Clearwater Printed on 6/6/2023 Cover Memo City of Clearwater Main Library - Council Chambers 100 N. Osceola Avenue Clearwater, FL 33755 File Number: ID#23-0740 Agenda Date: 6/12/2023 Status: Agenda ReadyVersion: 1 File Type: MinutesIn Control: Community Redevelopment Agency Agenda Number: 2.1 SUBJECT/RECOMMENDATION: Approve the minutes of the April 17, 2023 CRA Meeting as submitted in written summation by the City Clerk. SUMMARY: APPROPRIATION CODE AND AMOUNT: USE OF RESERVE FUNDS: Page 1 City of Clearwater Printed on 6/6/2023 Community Redevelopment Agency Meeting Minutes April 17, 2023 Page 1 City of Clearwater City of Clearwater Main Library - Council Chambers 100 N. Osceola Avenue Clearwater, FL 33755 Meeting Minutes Monday, April 17, 2023 8:00 AM Main Library - Council Chambers Community Redevelopment Agency Draft Community Redevelopment Agency Meeting Minutes April 17, 2023 Page 2 City of Clearwater Roll Call Present 5 - Chair Brian Aungst Sr., Trustee Kathleen Beckman, Trustee Mark Bunker, Trustee David Allbritton, and Trustee Lina Teixeira Also Present: Jennifer Poirrier – City Manager, Michael Delk – Assistant City Manager, David Margolis – City Attorney, Rosemarie Call – City Clerk, Nicole Sprague – Deputy City Clerk, and Dr. Jaye Matthews – CRA Executive Director. To provide continuity for research, items are listed in agenda order although not necessarily discussed in that order. Unapproved 1. Call to Order – Chair Aungst, Sr. The meeting was called to order at 8:00 a.m. 2. Approval of Minutes 2.1 Approve the minutes of the February 13, 2023 CRA Meeting as submitted in written summation by the City Clerk. Trustee Beckman moved to approve the minutes of the February 13, 2023 CRA Meeting as submitted in written summation by the City Clerk. The motion was duly seconded and carried unanimously. 3. Citizens to be Heard Regarding Items Not on the Agenda – None. 4. New Business Items 4.1 Recommend approval of amendments to the Clearwater Downtown Redevelopment Plan. The City established the Public Amenities Incentive Pool (Pool) in the Clearwater Downtown Redevelopment Plan when it was amended in 2004. The Pool is intended to support private sector efforts to redevelop Downtown by providing the ability to request increases in density and/or intensity in excess of the established maximum development potential when certain public amenities are incorporated into the project, thereby providing benefits to both parties and furthering the City’s goals for Downtown. Proposed Ordinance No. 9663-23 is the first amendment to the Pool since it was established and is the first step in modifying the allocation process of units and floor area from the Pool to address previous direction from the City Council. This amendment would allow the Community Development Director to approve such allocations through the Development Review Committee (DRC) process, Draft Community Redevelopment Agency Meeting Minutes April 17, 2023 Page 3 City of Clearwater the details of which will be established in the Community Development Code through a separate Ordinance. Additionally, the list of eligible amenities is proposed to be expanded to encourage the construction of Class A office space in the Downtown Core and Prospect Lake Character Districts and hotel and residential rental projects throughout Downtown, as well as to support the inclusion of sustainable development technologies in new development. The Community Redevelopment Agency has the authority and responsibility to make a recommendation on the proposed amendments to the Clearwater Downtown Redevelopment Plan to the City Council. The Community Development Board, in its capacity as the Local Planning Agency (LPA), will review the proposed amendments to the Clearwater Downtown Redevelopment Plan at its meeting on April 18, 2023, and make a recommendation to City Council. The Council has the authority for the final decision on the amendments. In response to questions, Planning and Development Assistant Director Lauren Matzke said character districts are the different defined areas in the downtown plan, such as the downtown core, Prospect Lake, Downtown Gateway, South Gateway, and Old Bay. The proposed change encourages Class A office space in the Downtown core and Prospect Lake area. She said staff worked with CRA and Economic Development and Housing and identified that more office space was needed to meet their economic development goals. She said Class A is the desired space for corporations. Trustee Bunker moved to recommend approval of amendments to the Clearwater Downtown Redevelopment Plan. The motion was duly seconded and carried unanimously. 4.2 Approve allocating remaining White Box Grant funds to the Business Renovation Grant Program. At the January 9, 2023 Community Redevelopment Agency (CRA) meeting, staff requested terminating the White Box Grant Program as it is similar to the Business Renovation Grant, which provides up to $100,000. To date, there have been seven approved grants totaling $277,722. The CRA’s White Box Grant Program was established with a $300,000 budget. To date, there is currently one approved and active grant for $50,000. Staff recommends moving the remaining $250,000 from the terminated White Box Grant Program to the Business Renovation Grant Program, bringing the available balance to $272,278. Draft Community Redevelopment Agency Meeting Minutes April 17, 2023 Page 4 City of Clearwater Four applicants are pending grant approval that have submitted Business Renovation Grant Application. APPROPRIATION CODE AND AMOUNT: Business Renovation Grants are paid from 3887552- R2003- Economic Development-City In response to a question, CRA Executive Director Jaye Matthews said the funds sitting in the White Box grants will be moved over to the Business Renovation grant program since the program was terminated. Trustee Teixeira moved to approve allocating remaining White Box Grant funds to the Business Renovation Grant Program. The motion was duly seconded and carried unanimously. 5. Director's Report CRA Executive Director Jaye Matthews reviewed recent and upcoming events. She said since the last meeting, three new businesses have opened in downtown: Ahilly's Ice Cream, Flamboyan Bar & Restaurant, and Captian's Cigar Lounge. The Nash Keys has scheduled a grand opening at the end of May. She said staff is reaching out to existing businesses this week regarding a discount program that would run in conjunction with the grand opening of Coachman Park. Dr. Matthews said the grants programs are still under an audit; she hopes to complete the audit soon. Staff is considering dumpster enclosures and storm drain screens as part of a placemaking program for Stevenson Creek. The Pinellas County Board of Commissioners will be voting on the North Greenwood Community Redevelopment Agency on May 23, 2023. In response to questions, Dr. Matthews said installing the screens for the storm drains can be implemented quickly. Regarding the dumpster enclosures, staff is addressing code related questions before moving forward with implementation. The City Manager said CRA, Code Enforcement, Solid Waste, and Office of Innovation staff met to discuss options for addressing the overflowing dumpsters. Draft Community Redevelopment Agency Meeting Minutes April 17, 2023 Page 5 City of Clearwater 6. Adjourn The meeting adjourned at 8:20 a.m. Chair Community Redevelopment Agency Attest City Clerk Draft Cover Memo City of Clearwater Main Library - Council Chambers 100 N. Osceola Avenue Clearwater, FL 33755 File Number: ID#23-0718 Agenda Date: 6/12/2023 Status: Agenda ReadyVersion: 1 File Type: Action ItemIn Control: Community Redevelopment Agency Agenda Number: 4.1 SUBJECT/RECOMMENDATION: Approve the 2022 Annual Financial Report. SUMMARY: Presentation of fiscal year 2022 Annual Financial Report by external auditors. Page 1 City of Clearwater Printed on 6/6/2023 Clearwater Community Redevelopment Agency (A Component Unit of the City of Clearwater, Florida) Annual Financial Report Year Ended September 30, 2022 This Page Intentionally Left Blank CLEARWATER COMMUNITY REDEVELOPMENT AGENCY (A Component Unit of the City of Clearwater, Florida) ANNUAL FINANCIAL REPORT FOR THE FISCAL YEAR ENDED SEPTEMBER 30, 2022 Brian J. Aungst Sr. Chair David Allbritton Trustee Kathleen Beckman Trustee Mark Bunker Trustee Lina Teixeira Trustee Dr. Jaye Matthews CRA Executive Director PREPARED BY: CITY OF CLEARWATER FINANCE DEPARTMENT CLEARWATER COMMUNITY REDEVELOPMENT AGENCY (A Component Unit of the City of Clearwater, Florida) ANNUAL FINANCIAL REPORT YEAR ENDED SEPTEMBER 30, 2022 TABLE OF CONTENTS Independent Auditors’ Report 1 - 3 Management’s Discussion and Analysis 4 - 13 Basic Financial Statements Government-Wide Financial Statements: Statement of Net Position - Governmental Activities 14 Statement of Activities - Governmental Activities 15 Fund Financial Statements: Balance Sheet – Governmental Funds 16 Reconciliation of the Governmental Funds Balance Sheet to the Statement of Net Position 17 Statement of Revenues, Expenditures, and Changes in Fund Balance - Governmental Funds 18 Reconciliation of the Change in Fund Balance of the Governmental Funds to the Statement of Activities 19 Statement of Revenues, Expenditures, and Changes in Fund Balance - Budget and Actual - General Fund 120 Notes to the Financial Statements 21 - 27 Compliance Section Independent Auditor’s 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 28 - 29 Management Letter 30 - 32 Independent Accountants’ Report on Compliance with Section 218.415, Florida Statutes 33 Independent Accountants’ Report on Compliance with Redevelopment Trust Fund 34 INDEPENDENT AUDITORS’ REPORT To the Honorable Chair and Trustees Clearwater Community Redevelopment Agency Report on the Audit of the Financial Statements Opinion We have audited the accompanying financial statements of the governmental activities and each major fund of the Clearwater Community Redevelopment Agency (“Agency”) as of and for the year ended September 30, 2022, and the related notes to the financial statements, which collectively comprise the Agency’s basic financial statements as listed in the table of contents. In our opinion, the financial statements referred to above present fairly, in all material respects, the respective financial position of the governmental activities and each major fund of the Clearwater Community Redevelopment Agency, as of September 30, 2022, and the respective changes in financial position and the respective budgetary comparison for the General Fund for the year then ended in accordance with accounting principles generally accepted in the United States of America. Basis for Opinions 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. Our responsibilities under those standards are further described in the Auditors’ Responsibilities for the Audit of the Financial Statements section of our report. We are required to be independent of the Agency and to meet our other ethical responsibilities, in accordance with the relevant ethical requirements relating to our audit. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinions. Responsibilities of Management for the Financial Statements Management is responsible for the preparation and fair presentation of the financial statements in accordance with accounting principles generally accepted in the United States of America, and for the design, implementation, and maintenance of internal control relevant to the preparation and fair presentation of financial statements that are free from material misstatement, whether due to fraud or error. In preparing the financial statements, management is required to evaluate whether there are conditions or events, considered in the aggregate, that raise substantial doubt about the Agency’s ability to continue as a going concern for twelve months beyond the financial statement date, including any currently known information that may raise substantial doubt shortly thereafter. 1 Auditors’ Responsibilities for the Audit of the Financial Statements Our objectives are to obtain reasonable assurance about whether the financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an auditors’ report that includes our opinions. Reasonable assurance is a high level of assurance but is not absolute assurance and therefore is not a guarantee that an audit conducted in accordance with generally accepted auditing standards and Government Auditing Standards will always detect a material misstatement when it exists. The risk of not detecting a material misstatement resulting from fraud is higher than for one resulting from error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal control. Misstatements are considered material if there is a substantial likelihood that, individually or in the aggregate, they would influence the judgment made by a reasonable user based on the financial statements. In performing an audit in accordance with generally accepted auditing standards and Government Auditing Standards, we: x Exercise professional judgment and maintain professional skepticism throughout the audit. x Identify and assess the risks of material misstatement of the financial statements, whether due to fraud or error, and design and perform audit procedures responsive to those risks. Such procedures include examining, on a test basis, evidence regarding the amounts and disclosures in the financial statements. x Obtain an understanding of internal control relevant to the audit in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the Agency’s internal control. Accordingly, no such opinion is expressed. x Evaluate the appropriateness of accounting policies used and the reasonableness of significant accounting estimates made by management, as well as evaluate the overall presentation of the financial statements. x Conclude whether, in our judgment, there are conditions or events, considered in the aggregate, that raise substantial doubt about the Agency’s ability to continue as a going concern for a reasonable period of time. We are required to communicate with those charged with governance regarding, among other matters, the planned scope and timing of the audit, significant audit findings, and certain internal control-related matters that we identified during the audit. Required Supplementary Information Accounting principles generally accepted in the United States of America require that the management’s discussion and analysis be presented to supplement the basic financial statements. Such information, although not a part of the basic financial statements, is required by the Governmental Accounting Standards Board, who considers it to be an essential part of financial reporting for placing the basic financial statements in an appropriate operational, economic, or historical context. We have applied certain limited procedures to the required supplementary information in accordance with auditing standards generally accepted in the United States of America, which consisted of inquiries of management about the methods of preparing the information and comparing the information for consistency with management’s responses to our inquiries, the basic financial statements, and other knowledge we obtained during our audit of the basic financial statements. 2 We do not express an opinion or provide any assurance on the information because the limited procedures do not provide us with sufficient evidence to express an opinion or provide any assurance. Other Reporting Required by Government Auditing Standards In accordance with Government Auditing Standards, we have also issued our report dated May 19, 2023, on our consideration of the Agency’s internal control over financial reporting and on our tests of its compliance with certain provisions of laws, regulations, contracts and grant agreements and other matters. The purpose of that report is solely 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 effectiveness of the Agency’s internal control over financial reporting or on compliance. That report is an integral part of an audit performed in accordance with Government Auditing Standards in considering the Agency’s internal control over financial reporting and compliance. CARR, RIGGS & INGRAM, LLC Clearwater, Florida May 19, 2023 3 4 Management’s Discussion and Analysis As management of the Clearwater Community Redevelopment Agency (CRA), we offer readers of the CRA’s financial statements this narrative overview and analysis of the financial activities of the CRA for the fiscal year ended September 30, 2022, with comparisons to prior year performance. We encourage readers to consider the information presented here in conjunction with the statements and related notes contained in the Basic Financial Statements. Financial Highlights The assets of the Clearwater Community Redevelopment Agency exceeded its liabilities as of September 30, 2022, by $17,777,678 (net position). Of this amount, $6,292,806 is invested in capital assets and $11,484,872 is restricted for community redevelopment activities. The CRA’s total net position increased by $2,224,348 during the fiscal year ended September 30, 2022, versus an increase of $1,194,624 in fiscal 2021. Program expenses decreased $916,127 from the prior year, while program revenues increased $1,158,983 and general revenues decreased $1,045,387, resulting in an increase in the change in net position of $1,029,724. General revenues decreased $1,045,386 due to a decrease in investment earnings resulting from a decreased market value valuation of the City of Clearwater’s investment portfolio due to rising interest rates, offset by an increase in the CRA’s cash balance of $1.8 million. Overview of Financial Statements This discussion and analysis are intended to serve as an introduction to the Clearwater Community Redevelopment Agency’s basic financial statements. The CRA’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. Government-Wide Financial Statements The government-wide financial statements are designed to provide readers with a broad overview of the Clearwater Community Redevelopment Agency’s finances, in a manner similar to a private-sector business. The statement of net position presents information on all of the CRA’s assets and liabilities, with the differences between the two reported as net position. Over time, increases or decreases in net position may serve as a useful indicator of whether the financial position of the CRA is improving or deteriorating. The statement of activities presents information showing how the government’s net position changed during the most recent fiscal year. All changes in net position are reported as soon as the underlying event giving rise to the change occurs, regardless of the timing of related cash flows. Thus, revenues and expenses are reported in this statement for some items that will only result in cash flows in future fiscal periods (e.g., uncollected taxes). 5 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 Clearwater Community Redevelopment Agency, like other state and local governments, uses fund accounting to ensure and demonstrate compliance with finance-related legal requirements. CRA activities are accounted for in a General Fund and a Capital Projects Fund. Governmental funds are used to account for essentially the same functions reported as governmental activities in the government-wide financial statements. However, unlike the government-wide financial statements, governmental fund financial statements focus on near-term inflows and outflows of spendable resources, as well as on 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. The Clearwater Community Redevelopment Agency adopts an annual appropriated budget for its general fund. A budgetary comparison statement has been provided for the general fund to demonstrate compliance with this requirement. Notes to the Financial Statements The notes provide additional information that is essential to a full understanding of the data provided in the government-wide and fund financial statements. 6 Government-Wide Financial Analysis As noted earlier, net position may serve over time as a useful indicator of a government’s financial position. In the case of the Clearwater Community Redevelopment Agency, assets exceeded liabilities by $17,777,678 at the close of the most recent fiscal year. The following table provides a summary of the CRA’s net position: Clearwater Community Redevelopment Agency Comparative Statement of Net Position September 30, 2021 and 2022 Governmental Activities Total 2022 2021 2022 2021 ASSETS Current and other assets $ 11,878,123 $ 10,086,393 $ 11,878,123 $ 10,086,393 Capital assets(net) 6,292,806 5,862,953 6,292,806 5,862,953 Total assets 18,170,929 15,949,346 18,170,929 15,949,346 LIABILITIES Current and other liabilities 393,251 396,016 393,251 396,016 Total liabilities 393,251 396,016 393,251 396,016 NET POSITION Net investment in capital assets 6,292,806 5,862,953 6,292,806 5,862,953 Restricted 11,484,872 9,690,377 11,484,872 9,690,377 Total net position $ 17,777,678 $ 15,553,330 $ 17,777,678 $ 15,553,330 7 The following table provides a summary of the Clearwater Redevelopment Agency’s changes in net position for the years ended September 30, 2022 and 2021: Clearwater Community Redevelopment Agency Comparative Statement of Changes in Net Position September 30, 2021 and 2022 Governmental Activities Total 2022 2021 2022 2021 REVENUES Program revenues: Charges for Services $ 78,748 $ 76,085 $ 78,748 $ 76,085 Operating Grants and Contributions 4,952,878 4,724,353 4,952,878 4,724,353 Capital Grants and Contributions 927,795 - 927,795 - General revenues: Investment earnings (loss) (1,060,689) (28,534) (1,060,689) (28,534) Gain (loss) on sale of capital assets - 13,231 - 13,231 Total revenues 4,898,732 4,785,135 4,898,732 4,785,135 EXPENSES Governmental activities: Economic Environment 2,674,384 3,590,511 2,674,384 3,590,511 Total expenses 2,674,384 3,590,511 2,674,384 3,590,511 Change in net position 2,224,348 1,194,624 2,224,348 1,194,624 Total net position - beginning 15,553,330 14,358,706 15,553,330 14,358,706 Total net position - ending $ 17,777,678 $ 15,553,330 $ 17,777,678 $ 15,553,330 Governmental Activities The increase in governmental activities net position in fiscal 2022 totaled $2,224,348 as compared to an increase in net position of $1,194,624 in fiscal 2021. Key elements of this change are as follows:  Total expenses increased $916,127 (25.5%). General fund expenses decreased $33 thousand primarily due to a decrease in spend of $36 thousand for the downtown marketing plan completed in fiscal 2021, a decrease of $39 thousand in the payment to the Clearwater Downtown Development Board to return tax increment funding due to a one-time correction of property values within the DDB district used to calculate the tax increment, offset by an increase of $32 thousand in the payment to the City of Clearwater for administrative services provided by the City to the CRA. Capital projects fund expenses decreased $876 thousand, primarily due a decrease of $1.6 million in payments to the City of Clearwater to fund capital improvement projects and community policing services in the CRA area, offset by an increase of $521 thousand in loan to grant agreements for downtown businesses, an increase in professional services of $143 thousand resulting from preparations to the Main Library for art gallery exhibits, and an increase of $16 thousand in advertising costs to promote art exhibits at the Main Library. Additionally, depreciation expense decreased $7,264 from the prior year due to the sale of 701 Franklin Street in fiscal 2021. 8  Total program revenues increased $231,188 (4.8%), due to an increase in tax increment revenues in the amount of $228,525 received from Pinellas County, the City of Clearwater and the Clearwater Downtown Development Board as a result of increased property tax values in the CRA district, as well as an increase of $2,663 (3.5%) in the payment received from the Clearwater Downtown Development Board (DDB) for administrative services provided by CRA staff.  Total general revenues decreased $1,045,386 due to a decrease in investment earnings of $1,032,155 resulting from decreased market valuation of investments due to rising interest rates, in addition to a decrease in gain on the sale of capital assets of $13,231 resulting from the sale of 711 Franklin Street in fiscal 2021. 9 Expenses and Program Revenues - Governmental Activities Functions/Programs Expenses % of Total Program Revenues % of Total Net (Expense) Revenue Economic Environment $ 2,674,384 100.00% $ 5,959,421 100.00% $ 3,285,037 Total $ 2,674,384 100.00% $ 5,959,421 100.00% $ 3,285,037 $2,674,384 $5,959,421 $- $1,000,000 $2,000,000 $3,000,000 $4,000,000 $5,000,000 $6,000,000 $7,000,000 Economic Environment Expenses and Program Revenues - Governmental-Type Activities Expenses Program Revenues 10 Revenues by Source - Governmental Activities Revenues Source Revenues % of Total Charges for Services $ 78,748 1.61% Operating Grants and Contributions 4,952,878 101.11% Capital Grants and Contributions 927,795 18.94% Investment Earnings (Loss) (1,060,689) -21.65% Total $ 4,898,732 100.00% 1.61% 101.11% 18.94% -21.65% Revenues by Source - Governmental Activities Charges for Services Operating Grants and Contributions Capital Grants and Contributions Investment Earnings (Loss) 11 Financial Analysis of the Clearwater Community Redevelopment Agency’s Funds As noted earlier, the Clearwater Community Redevelopment Agency uses fund accounting to ensure and demonstrate compliance with finance related requirements. Governmental Funds The focus of the Clearwater Community Redevelopment Agency’s general fund is to provide information on near term inflows, outflows, and balances of spendable resources. Such information is useful in assessing the CRA’s financing requirements. In particular, unassigned fund balance may serve as a useful measure of a government’s net resources available for spending at the end of the fiscal year. As of the end of the current fiscal year, the CRA’s general fund reported an ending fund balance of $6,213, a decrease of $6,687 for fiscal 2022 in comparison with a decrease of $118,743 for the prior year. Revenues decreased $800,967 due to a decrease in investment earnings of $1,032,155 resulting from decreased market valuation of investments due to rising interest rates, offset by an increase of $228,525 (4.8%) in tax increment revenue received from Pinellas County, the City of Clearwater and the Clearwater Downtown Development Board as a result of increased property tax values in the CRA district, as well as an increase of $2,663 (3.5%) in the payment received from the Clearwater Downtown Development Board (DDB) for administrative services provided by CRA staff. Current expenditures decreased $33 thousand primarily due to a decrease in spend of $36 thousand for the downtown marketing plan completed in fiscal 2021, a decrease of $39 thousand in the payment to the Clearwater Downtown Development Board to return tax increment funding due to a one-time correction of property values within the DDB district used to calculate the tax increment, offset by an increase of $32 thousand in the payment to the City of Clearwater for administrative services provided by the City to the CRA. The fund balance of the capital projects fund increased from $9,677,477 to $11,478,659, an increase of $1,801,182 or 18.6% during the current fiscal year compared to an increase of $1,855,305 for fiscal 2021. Revenues increased $928 thousand due to funds received from the City of Clearwater for the Gateway Mercado project. Current expenditures decreased $876 thousand, primarily due a decrease of $1.6 million in payments to the City of Clearwater to fund capital improvement projects and community policing services in the CRA area, offset by an increase of $521 thousand in loan to grant agreements for downtown businesses, an increase in professional services of $143 thousand resulting from preparations to the Main Library for art gallery exhibits, and an increase of $16 thousand in advertising costs to promote art exhibits at the Main Library. Capital outlay increased $453 thousand from the prior year, due to the acquisition of downtown properties to be offered for redevelopment. The fund balances are restricted, and only available for spending to preserve and enhance the tax base per the redevelopment trust fund established pursuant to Chapter 163.387, Florida Statutes, City of Clearwater Ordinance 7214-03, and Pinellas County Ordinance 04-10. General Fund Budgetary Highlights Final budgeted General Fund revenues are the same as original budgeted revenues. Final budgeted General Fund expenditures are the same as original budgeted expenditures. Final budgeted General Fund transfers out are the same as original budgeted transfers out. 12 Total actual expenditures were less than final budgeted expenditures in the amount of $209,791, primarily due to expenditures being less than anticipated in the professional and contractual services line item ($70 thousand), payments to the City of Clearwater for staffing, information technology and telephone services ($131 thousand), and the employee training and reference line item ($9 thousand). Capital Assets Capital assets include land, buildings and building improvements, improvements other than buildings, and machinery and equipment. At September 30, 2022, the Clearwater Community Redevelopment Agency had investments in capital assets totaling $6,292,806 (net of accumulated depreciation). Clearwater Community Redevelopment Agency Comparative Statement of Capital Assets September 30, 2021 and 2022 Governmental Activities Total 2022 2021 2022 2021 Land $ 5,840,550 $ 5,395,493 $ 5,840,550 $ 5,395,493 Buildings 458,099 458,099 458,099 458,099 Construction in progress 60,964 53,263 60,964 53,263 6,359,613 5,906,855 6,359,613 5,906,855 Less: accumulated depreciation (66,807) (43,902) (66,807) (43,902) Capital assets, net $ 6,292,806 $ 5,862,953 $ 6,292,806 $ 5,862,953 Net capital assets for the CRA’s governmental activities increased from $5,862,953 to $6,292,806, reflecting an increase in land of $445,057 for the acquisition of the property at 1351 Cleveland Street and an increase in construction in progress of $7,701, offset by $22,905 in depreciation expense. Land and buildings consist of properties purchased by the CRA to be offered to for redevelopment opportunities intended to attract people to live, work and play downtown. Construction in progress consists of design work for the Gateway Mercado, a dynamic public plaza space at the intersection of Cleveland Street and Gulf to Bay Boulevard to be incorporated with the larger Cleveland Street Streetscape Phase III project, currently underway by the City of Clearwater. Long-Term Debt The Clearwater Community Redevelopment Agency’s tax increment revenues are not pledged externally to any lender for any indebtedness related to the CRA. 13 Economic Factors and Next Year’s Budgets and Rates Factors considered in preparing the Clearwater Community Redevelopment Agency’s budget for fiscal year 2023 included:  In the original CRA district, taxable county property values increased 9.0%, from $468.5 million to $510.5 million, while taxable municipal property values increased 9.0%, from $468.4 million to $510.4 million. In the expanded CRA district, taxable county property values increased 15.6%, from $143.2 million to $165.5 million, while taxable municipal property values increased 15.6%, from $143.0 million to $165.2 million. The difference between municipal and county taxable values is due to an additional homestead exemption offered by the City of Clearwater to low-income seniors. The tax increment received by the CRA from Pinellas County, the City of Clearwater and the Clearwater Downtown Development Board is based on the increase in taxable value in the CRA district over a base year, which is identified as 1981 for the original CRA district and 2004 for the expanded CRA district.  The CRA entered into an interlocal agreement with the Clearwater Downtown Development Board to provide personnel, administrative and management services for fiscal year 2023. This agreement has been in place since fiscal year 2000. It provides for the Clearwater Downtown Development Board to pay the CRA $81,504 for these services in fiscal year 2023, an increase of 3.5% over the previous year. It also provides for the CRA to return the tax increment payment received from the Clearwater Downtown Development Board pursuant to Florida Statue 163.387 in exchange for the performance of certain responsibilities and functions consistent with and in furtherance of the Downtown Redevelopment Plan.  The CRA entered into an interlocal agreement with the City of Clearwater to provide staffing and administrative services to the CRA for fiscal year 2023, and to provide for the reimbursement of certain expenses by the CRA to the City.  The CRA entered into an interlocal agreement with the City of Clearwater to provide funding in the amount of $266,703 for fiscal year 2023 to underwrite the cost of additional community policing services performed by the Clearwater Police Department in the Downtown Gateway District, Prospect Lake District, and the Downtown Core District encompassed by the CRA to address quality of life issues, drug dealing, prostitution and homelessness. Request for Information This financial report is designed to provide a general overview of the Clearwater Community Redevelopment Agency’s finances for all those with an interest in the government’s finances. Questions concerning any of the information provided in this report or requests for additional financial information should be addressed to the City of Clearwater, Finance Department, 100 S. Myrtle Avenue, Clearwater, Florida 33756-5520. ASSETS Current assets: Cash and cash equivalents 11,858,949$ Receivables 19,174 Total current assets 11,878,123 Noncurrent assets: Land 5,840,550 Buildings, net 391,292 Construction in progress 60,964 Total noncurrent assets 6,292,806 Total assets 18,170,929 LIABILITIES Accounts payable and other current liabilities 19,811 Due to other governments 373,440 Total liabilities 393,251 NET POSITION Net investment in capital assets 6,292,806 Restricted for: Community Redevelopment 11,484,872 Total net position 17,777,678$ The notes to financial statements are an integral part of this statement. Clearwater Community Redevelopment Agency (A Component Unit of the City of Clearwater, Florida) Statement of Net Position September 30, 2022 14 Net (Expense) Revenue and Change in Net Position Primary Government Functions/Programs Expenses Charges for Services Operating Grants and Contributions Capital Grants and Contributions Governmental Activities Governmental activities: Economic Environment 2,674,384$ 78,748$ 4,952,878$ 927,795$ 3,285,037$ Total governmental activities 2,674,384 78,748 4,952,878 927,795 3,285,037 Total primary government 2,674,384$ 78,748$ 4,952,878$ 927,795$ 3,285,037 (1,060,689) (1,060,689) 2,224,348 15,553,330 17,777,678$ The notes to financial statements are an integral part of this statement. Investment earnings (loss) Total general revenues Change in net position Net position - beginning Net position - ending Program Revenues General revenues: Clearwater Community Redevelopment Agency (A Component Unit of the City of Clearwater, Florida) Statement of Activities For the Year Ended September 30, 2022 15 General Fund Capital Projects Fund Total Governmental Funds ASSETS Cash and cash equivalents 372,518$ 11,486,431$ 11,858,949$ Accrued interest 19,174 - 19,174 Total assets 391,692$ 11,486,431$ 11,878,123$ LIABILITIES Accounts and contracts payable 12,039$ 7,772$ 19,811$ Due to other governments 373,440 - 373,440 Total liabilities 385,479 7,772 393,251 Total liabilities and deferred inflows of resources 385,479 7,772 393,251 FUND BALANCE Restricted 6,213 11,478,659 11,484,872 Total fund balance 6,213 11,478,659 11,484,872 Total liabilities and fund balance 391,692$ 11,486,431$ 11,878,123$ The notes to financial statements are an integral part of this statement. Clearwater Community Redevelopment Agency (A Component Unit of the City of Clearwater, Florida) Balance Sheet Governmental Funds September 30, 2022 16 Clearwater Community Redevelopment Agency Reconciliation of Balance Sheet to the Statement of Net Position (A Component Unit of the City of Clearwater, Florida) Cost of capital assets 6,359,613 For the Year Ended September 30, 2022 The notes to the financial statements are an integral part of this statement. (66,807) $ 11,484,872 Amounts reported for governmental activities in the statement of net position are different because: Fund balances of governmental funds Capital assets used in governmental activities are not financial resources and are not reported in the funds. 6,292,806 $ 17,777,678 Net position of governmental activities Less: Accumulated Depreciation 17 General Fund Capital Projects Fund Total Governmental Funds REVENUES Intergovernmental revenue - tax increment 4,952,878$ -$ 4,952,878$ Charges for services 78,748 - 78,748 Capital grants and contributions - 927,795 927,795 Investment earnings (loss): Interest 113,986 - 113,986 Net appreciation (depreciation) in fair value (1,174,675) - (1,174,675) Total investment earnings (loss) (1,060,689) - (1,060,689) Total revenues 3,970,937 927,795 4,898,732 EXPENDITURES Current: Economic Environment 977,423 1,674,056 2,651,479 Capital outlay: Economic Environment - 452,758 452,758 Total expenditures 977,423 2,126,814 3,104,237 Excess (deficiency) of revenues over expenditures 2,993,514 (1,199,019) 1,794,495 OTHER FINANCING SOURCES (USES) Transfers in 962,218 3,962,419 4,924,637 Transfers out (3,962,419) (962,218) (4,924,637) Total other financing sources (uses) (3,000,201) 3,000,201 - Net change in fund balances (6,687) 1,801,182 1,794,495 Fund balances - beginning 12,900 9,677,477 9,690,377 Fund balances - ending 6,213$ 11,478,659$ 11,484,872$ The notes to financial statements are an integral part of this statement. Clearwater Community Redevelopment Agency (A Component Unit of the City of Clearwater, Florida) Governmental Funds For the Year Ended September 30, 2022 Statement of Revenues, Expenditures and Changes in Fund Balance 18 452,758 Expenditures for capital assets (22,905)Less: Current year depreciation 429,853 The notes to the financial statements are an integral part of this statement. Clearwater Community Redevelopment Agency For the Year Ended September 30, 2022 (A Component Unit of the City of Clearwater, Florida) Reconciliation of the Statement of Revenues, Expenditures and Changes in Fund Balances to the Statement of Net change in fund balances - total government funds $ 1,794,495 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 these costs over the life of the assets. This is the amount by which capital outlays exceeded depreciation in the current period. Change in net position of govenmental activities $ 2,224,348 19 Original Final Actual Variance with Final Budget REVENUES Intergovernmental revenue - tax increment 5,015,885$ 5,015,885$ 4,952,878$ (63,007)$ Charges for services 78,748 78,748 78,748 - Investment earnings (loss): Interest 55,000 55,000 113,986 58,986 Net appreciation (depreciation) in fair value - - (1,174,675) (1,174,675) Total investment earnings (loss) 55,000 55,000 (1,060,689) (1,115,689) Total revenues 5,149,633 5,149,633 3,970,937 (1,178,696) EXPENDITURES Current: Economic Environment 1,187,214 1,187,214 977,423 209,791 Total expenditures 1,187,214 1,187,214 977,423 209,791 Excess (deficiency) of revenues over expenditures 3,962,419 3,962,419 2,993,514 (968,905) OTHER FINANCING SOURCES (USES) Transfers in - - 962,218 962,218 Transfers out (3,962,419) (3,962,419) (3,962,419) - Total other financing sources (uses) (3,962,419) (3,962,419) (3,000,201) 962,218 Net change in fund balances - - (6,687) (6,687) Fund balances - beginning 12,900 12,900 12,900 - Fund balances - ending 12,900$ 12,900$ 6,213$ (6,687)$ Budgeted Amounts The notes to financial statements are an integral part of this statement. Clearwater Community Redevelopment Agency Schedule of Revenues, Expenditures and Changes in Fund Balances - Budget and Actual General Fund For the Year Ended September 30, 2022 (A Component Unit of the City of Clearwater, Florida) 20 CLEARWATER COMMUNITY REDEVELOPMENT AGENCY (A Component Unit of the City of Clearwater, Florida) Notes to the Financial Statements September 30, 2022 21 (1) Summary of Significant Accounting Policies In 1981, the City of Clearwater (City) initially established a Community Redevelopment Agency (CRA), generally encompassing 260 acres, excluding existing rights-of-way, within an area generally described as Jones and Grove Streets to the north, Chestnut, Turner and Gould Streets to the south, Clearwater Bay to the west, and Missouri and Frederica Avenues to the east. The CRA was expanded in 2002 with approval of the City and the Pinellas County Board of County Commissioners to incorporate the eastern gateway area to downtown now referred to as the “Downtown Gateway.” The expansion area contains approximately 228 acres, excluding existing rights-of-way, abutting and to the east of the original CRA, more generally described as the area lying east of Greenwood and Missouri Avenues, east to Highland Avenue, and bounded to the north by Drew Street, and to the south by Court Street. In 2004, the City and Pinellas County approved a significant update to the Clearwater Downtown Redevelopment Plan that set forth an ambitious list of capital improvement projects and strategies for reducing blight and spurring economic redevelopment, for a duration of thirty years. As a condition of CRA expansion, the CRA was required to update Pinellas County on its progress in implementing the 2004 redevelopment plan after a 15-year time period. On February 26, 2019, the County voted unanimously to continue its support of the CRA as an urban revitalization area and to fund the CRA at 95% of the eligible tax increment for another 15 years, to 2034. The CRA is funded primarily by tax increment financing (TIF) revenues collected from Pinellas County, the City of Clearwater, and the Clearwater Downtown Development Board. TIF revenues are based on the increase in taxable value in the CRA district over a base year, which is identified as 1981 for the original CRA district and 2004 for the expanded CRA district. The Clearwater City Council serves as the governing board of the CRA, and City management has operational responsibility for the CRA. The CRA does not have any employees. The CRA maintains its accounting records in accordance with generally accepted accounting principles (GAAP) as applied to government units. The Governmental Accounting Standards Board (GASB) is the accepted standard-setting body for establishing governmental accounting and financial reporting principles. The more significant of the CRA’s accounting policies are described below. (a) Reporting Entity The Governmental Accounting Standards Board requires that these financial statements disclose any component units of the Clearwater Community Redevelopment Agency. Component units generally are legally separate entities for which a primary government is financially accountable. In addition, the primary government is able to impose its will upon the component unit, or there is a possibility that the component unit may provide specific financial benefits or impose specific financial burdens on the primary government. The CRA does not have any component units. The CRA a component unit of the City of Clearwater and, therefore, is reported as a blended component unit in the City’s Annual Comprehensive Financial Report in accordance with generally accepted accounting principles. CLEARWATER COMMUNITY REDEVELOPMENT AGENCY (A Component Unit of the City of Clearwater, Florida) Notes to the Financial Statements September 30, 2022 22 (b) Government-Wide and Fund Financial Statements The government-wide financial statements (the statement of net position and the statement of activities) report information on all of the activities of the primary government. Governmental activities normally are supported by tax increment financing collected from the Pinellas County, the City of Clearwater, and the Clearwater Downtown Development Board, which are reported as intergovernmental revenues. The statement of activities demonstrates the degree to which the direct expenses of a given function or segment is 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. Other items not properly included among program revenues are reported instead as general revenues. Separate financial statements are provided for the governmental funds. Since the governmental fund financial statements are presented on a different measurement focus and basis of accounting than the government-wide statements’ governmental activities column, a reconciliation is presented on the page following each statement, which briefly explains the adjustments necessary to reconcile the fund based financial statements to the governmental activities column of the government-wide presentation. (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. Revenues are recorded when earned and expenses are recorded when a liability is incurred, regardless of the timing of related cash flows. 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 government considers revenues to be available if they are collected within sixty days of the end of the current fiscal period. Expenditures generally are recorded when a liability is incurred, as under accrual accounting. Interest income associated with the current fiscal period is considered to be susceptible to accrual and so has been recognized as revenues of the current fiscal period. All other revenue items are considered to be measurable and available only when cash is received by the CRA. CLEARWATER COMMUNITY REDEVELOPMENT AGENCY (A Component Unit of the City of Clearwater, Florida) Notes to the Financial Statements September 30, 2022 23 The CRA reports the following major governmental funds: The general fund is the government’s primary operating fund, and includes the services, supplies and expenditures that occur during the fiscal year to conduct the CRA’s daily operations. The capital projects fund is used to account for capital improvements and funding for established programs whose work extends beyond one fiscal year. Funds are appropriated to specific redevelopment projects in support of the Clearwater Downtown Redevelopment Plan, which was most recently updated in 2018. (d) Budgets An annual appropriated budget is legally adopted by the Trustees by resolution on a basis consistent with generally accepted accounting principles for the general fund. The budget is controlled at the fund level. The Trustees are authorized to transfer budgeted amounts within the general fund. In instances where appropriations and estimated revenues have been amended during the year by resolution, budget data presented in the financial statements represent final authorized amounts. Encumbrances outstanding at year-end are not reappropriated as part of the subsequent year’s budget. (e) Encumbrances Encumbrance accounting is used in governmental funds to ensure effective budgetary control and accountability and to facilitate effective cash planning and control. At September 30, 2022, encumbrances expected to be honored upon performance by the vendor in the coming year were: General fund $ 6,213 Capital projects fund 1,229,818 $1,236,031 (f) Cash and Investments The Clearwater Community Redevelopment Agency does not currently maintain accounts with either financial institutions or brokerages titled under its name. Cash and cash equivalents as presented in these financial statements reflects the CRA’s equity in the City of Clearwater’s pooled cash and investments and for purposes of these financial statements are considered demand deposits. All investments are governed by the City’s Investment Policy, adopted on September 9, 2010. 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 a consolidated cash pool to account for cash and investments of all City funds other than those which are required by ordinance to be physically segregated. The CRA is a participant in the City’s pooled cash and investments program. The consolidated cash pool CLEARWATER COMMUNITY REDEVELOPMENT AGENCY (A Component Unit of the City of Clearwater, Florida) Notes to the Financial Statements September 30, 2022 24 concept allows each participating fund to benefit from the economies of scale and improved yield which 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 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. (g) Fund Balance The Clearwater Community Redevelopment Agency classifies the elements of fund balance in accordance with GASB Statement No. 54, Fund Balance Reporting and Governmental Fund Type Definition. The objective of this statement is to enhance the usefulness of fund balance information by providing clearer fund balance classifications that can be more consistently applied. This statement establishes fund balance classifications that comprise a hierarchy based primarily on the extent to which the CRA is bound to observe constraints imposed upon the use of the resources reported in the general fund. Each classification of fund balance is based on the relative strength of the constraints that control how specific amounts can be spent. The order of spending would follow the same hierarchy; that is, if an amount for a specific purpose is categorized as restricted or committed, then spending for such purpose would come from that classification before any lower classification. Nonspendable fund balance represents amounts that cannot be spent, such as inventories, prepaid amounts, property held for resale, long-term notes receivable and amounts that are legally or contractually required to remain intact. Restricted fund balance includes amounts that can be spent only for the specific purposes stipulated by constitution, external resource providers, or through enabling legislation. Committed fund balance includes amounts that can be used only for the specific purposes determined by the highest level of legal authority of the Trustees, a resolution, and can only be changed by the same action. Assigned fund balance includes amounts that are intended to be used by the Trustees for specific purposes but do not meet the criteria to be classified as restricted or committed because they are supported by management’s intent rather than a formal action of the Trustees. Unassigned fund balance represents the residual amount of fund balance not contained in the other classifications. The Clearwater Community Redevelopment Agency has not adopted a minimum fund balance policy. CLEARWATER COMMUNITY REDEVELOPMENT AGENCY (A Component Unit of the City of Clearwater, Florida) Notes to the Financial Statements September 30, 2022 25 (2) Deposits and Investments Cash and cash equivalents as of September 30, 2022 are as follows: Demand deposits $11,858,949 Interest Rate Risk 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 investment policy states that it is the City’s intent to keep the weighted average maturity to 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 five years. Credit Risk The City’s pooled cash investment policy, in accordance with Florida Statutes, allows investments in 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. Concentration of Credit Risk The City’s pooled cash investment policy limits the investment in any one issuer to 40% of the portfolio. Custodial Credit Risk Monies on deposit with financial institutions are held in qualified public depositories pursuant to Chapter 280, Florida Statutes, which provides protection against any loss to public depositors. Consistent with the City’s investment policy, investments securities owned by the City are held by the City’s custodian in the City’s name and all purchases use the “delivery vs. payment” procedure. CLEARWATER COMMUNITY REDEVELOPMENT AGENCY (A Component Unit of the City of Clearwater, Florida) Notes to the Financial Statements September 30, 2022 26 (3) Capital Assets Capital asset activity for the year ended September 30, 2022 is as follows: Beginning Ending Governmental Activities:Balance Increases Decreases Balance Non-depreciable capital assets: Land 5,395,493$ 445,057$ -$ 5,840,550$ Construction in progress 53,263 7,701 - 60,964 Total non-depreciable capital assets 5,448,756 452,758 - 5,901,514 Depreciable capital assets: Buildings 458,099 - - 458,099 Total depreciable capital assets 458,099 - - 458,099 Less accumulated depreciation for: Buildings (43,902) (22,905) - (66,807) Total accumulated depreciation (43,902) (22,905) - (66,807) Net depreciable capital assets 414,197 (22,905) - 391,292 Net governmental activities capital assets 5,862,953$ 429,853$ -$ 6,292,806$ (4) Interfund transfers Transfers from the general fund to the capital projects fund contributed to the following projects: Housing-County project $ 1,675,104 Community Engagement project 500,000 Economic Development-City project 500,000 Housing-City project 476,021 Economic Development-County project 335,020 Community Policing project 252,550 Transportation-County project 223,724 $ 3,962,419 Transfers from the capital projects fund to the general fund contributed to the following project: Replenish deficit fund balance $ 962,218 $ 962,218 (5) Interlocal Agreements On August 16, 2021, the Clearwater Community Redevelopment Agency (CRA) Trustees approved an interlocal agreement with the City of Clearwater (City) to provide funding in the amount of $252,550 to underwrite the cost of additional community policing services by the Clearwater Police CLEARWATER COMMUNITY REDEVELOPMENT AGENCY (A Component Unit of the City of Clearwater, Florida) Notes to the Financial Statements September 30, 2022 27 Department in the Downtown Gateway District, Prospect Lake District, and Downtown Core District, encompassed by the CRA to address quality of life issues, drug dealing, prostitution and homelessness. On September 13, 2021, the Clearwater Community Redevelopment Agency (CRA) Trustees approved an interlocal agreement with the City of Clearwater (City) to provide funding for staffing, information technology and telephone services for the CRA, and reimbursement of certain expenses by the CRA to the City. Actual administrative fees reimbursed to the City by the CRA totaled $520,356 for the fiscal year. On August 16, 2021, the CRA Trustees approved an interlocal agreement with the Clearwater Downtown Development Board (DDB) for the term of October 1, 2021 to September 30, 2022. The agreement specifies that the CRA will refund to the DDB the fiscal 2022 tax increment payment received from the DDB, which totaled $301,367 for the fiscal year, in support of downtown redevelopment initiatives. The agreement also provides that the CRA will deduct $78,748 from the reimbursement, to represent reimbursement to the CRA from the DDB for fiscal 2022 administrative support services provided. (6) Contingent Liabilities and Commitments For the year ended September 30, 2022, the CRA did not receive any amounts from grantor agencies that are subject to audit and adjustment by grantor agencies. (7) Loans Payable The following loans payable are presented as Due to Other Governments on the general fund balance sheet and the government-wide statement of net position: City of Clearwater: On September 1, 2011, the City of Clearwater approved a loan to the CRA in the amount of $325,440 for the environmental cleanup expense of the Car Pro site in the East Gateway area of the downtown. The loan is interest-free and is to be repaid upon the sale of the parcel. Clearwater Downtown Development Board: On September 22, 2003, the CRA Trustees approved an interlocal agreement with the Clearwater Downtown Development Board (DDB). Under the terms of this agreement, the DDB agreed to loan the CRA $48,000 to purchase property. The unsecured loan is not subject to interest and will be repaid to the DDB upon subsequent sale of the property. If the property is resold for an amount greater than the original purchase price, the CRA will pay a proportionate share (3.85%) of the profit. If the property sells for less than the original purchase price, then the CRA will reimburse the DDB for the entire principal amount of the loan. 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 To the Honorable Chair and Trustees Clearwater Community Redevelopment Agency We have audited, in accordance with the 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, the financial statements of the governmental activities and major fund of the Clearwater Community Redevelopment Agency (“Agency”), as of and for the year ended September 30, 2022, and the related notes to the financial statements, which collectively comprise the Agency’s basic financial statements, and have issued our report thereon dated May 19, 2023. Report on Internal Control over Financial Reporting In planning and performing our audit of the financial statements, we considered the Agency’s internal control over financial reporting (internal control) as a basis for designing audit procedures that are appropriate in the circumstances for the purpose of expressing our opinions on the financial statements, but not for the purpose of expressing an opinion on the effectiveness of the Agency’s internal control. Accordingly, we do not express an opinion on the effectiveness of the Agency’s internal control. A deficiency in internal control exists when the design or operation of a control does not allow management or employees, in the normal course of performing their assigned functions, to prevent, or detect and correct, misstatements on a timely basis. A material weakness is a deficiency, or a combination of deficiencies, in internal control, such that there is a reasonable possibility that a material misstatement of the entity’s financial statements will not be prevented, or detected and corrected, on a timely basis. A significant deficiency is a deficiency, or a combination of deficiencies, in internal control that is less severe than a material weakness, yet important enough to merit attention by those charged with governance. Our consideration of internal control was for the limited purpose described in the first paragraph of this section and was not designed to identify all deficiencies in internal control that might be material weaknesses or significant deficiencies. Given these limitations, during our audit we did not identify any deficiencies in internal control that we consider to be material weaknesses. However, material weaknesses or significant deficiencies may exist that have not been identified. Report on Compliance and Other Matters As part of obtaining reasonable assurance about whether the Agency’s financial statements are free from 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 financial statements. 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. 28 Purpose of this Report The purpose of this report is solely to describe the scope of our testing of internal control and compliance and the results of that testing, and not to provide an opinion on the effectiveness of the entity’s internal control or on compliance. This report is an integral part of an audit performed in accordance with Government Auditing Standards in considering the entity’s internal control and compliance. Accordingly, this communication is not suitable for any other purpose. CARR, RIGGS & INGRAM, LLC Clearwater, Florida May 19, 2023 29 MANAGEMENT LETTER To the Honorable Chair and Trustees Clearwater Community Redevelopment Agency Report on the Financial Statements We have audited the financial statements of the Clearwater Community Redevelopment Agency (“Agency”), as of and for the year ended September 30, 2022, and have issued our report thereon dated May 19, 2023. Auditors’ Responsibility We conducted our audit 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 and Chapter 10.550, Rules of the Auditor General. Other Reporting Requirements We have issued our Independent Auditors’ Report on Internal Control over Financial Reporting and on Compliance and Other Matters Based on an Audit of the Financial Statements Performed in Accordance with Government Auditing Standards; Independent Accountants’ Reports on an examination conducted in accordance with AICPA Professional Standards, AT-C Section 315, regarding compliance requirements in accordance with Chapter 10.550, Rules of the Auditor General. Disclosures in those reports, which are dated May 19, 2023, should be considered in conjunction with this management letter. Prior Audit Findings Section 10.554(1)(i)1., Rules of the Auditor General, requires that we determine whether or not corrective actions have been taken to address findings and recommendations made in the preceding annual financial audit report. No audit findings or recommendations were noted in the preceding annual financial audit report. Financial Condition and Management Section 10.554(1)(i)5.a. and 10.556(7), Rules of the Auditor General, require us to apply appropriate procedures and communicate the results of our determination as to whether or not the Agency has met one of more of the conditions described in Section 218.503(1), Florida Statutes, and to identify the specific conditions met. In connection with our audit, we determined that the Agency did not meet any of the conditions described in Section 218.503(1), Florida Statutes. Pursuant to Sections 10.554(1)(i)5.b. and 10.556(8), Rules of the Auditor General, we applied financial condition assessment procedures. It is management’s responsibility to monitor the Agency’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 same. Section 10.554(1)(i)2., Rules of the Auditor General, requires that we communicate any recommendations to improve financial management. In connection with our audit, we do not have any such recommendations. 30 Specific Information As required by Section 218.39(3)(c), Florida Statutes, and Section 10.554(1)(i)6, Rules of the Auditor General, the Clearwater Community Redevelopment Agency reported: a. The total number of Agency employees compensated in the last pay period of the Agency’s fiscal year as -0-. b. The total number of independent contractors to whom nonemployee compensation was paid in the last month of the Agency’s fiscal year as -0-. c. All compensation earned by or awarded to employees, whether paid or accrued, regardless of contingency as $-0-. d. All compensation earned by or awarded to nonemployee independent contractors, whether paid or accrued, regardless of contingency as $680,264 which was paid to 1099 vendors. e. Each construction project with a total cost of at least $65,000 approved by the Agency that is scheduled to begin on or after October 1 of the fiscal year being reported. The City of Clearwater is executing a streetscaping project which includes Paving, Beautification, Water and Sewer, and Stormwater work. The Agency has spent $90,884 to date in a purchase of a property at the end of Cleveland Street for the purpose of an outdoor festival area called “The Mercado”. Additionally, the CRA is contributing to the City’s part of the larger project in the amount of $927,795 to date. f. A budget variance based on the budget adopted under Section 189.016(4), Florida Statutes, before the beginning of the fiscal year being reported if the Agency amends a final adopted budget under Section 189.016(6), Florida Statutes, as Statement of Revenues, Expenditures, and Changes in Fund Balance – Budget and Actual – General included in the Agency’s basic financial statements. As required by Section 218.39(3)(c), Florida Statutes, and Section 10.554(1)(i)7, Rules of the Auditor General, the Clearwater Community Redevelopment Agency reported: a. The millage rate imposed by the Agency as $-0-. b. The total amount of ad valorem taxes collected on behalf of the Agency as $-0-. c. The total amount of outstanding bonds issued by the Agency and the terms of such bonds as $-0- . Additional Matters Section 10.554(1)(i)3., Rules of the Auditor General, requires us to communicate noncompliance with provisions of contracts or grant agreements, or abuse, that have occurred, or are likely to have occurred, that have an effect on the financial statements that is less than material but warrants the attention of those charged with governance. In connection with our audit, we did not note any such findings. 31 Purpose of this Letter Our management letter is intended solely for the information and use of the Legislative Auditing Committee, members of the Florida Senate and the Florida House of Representatives, the Florida Auditor General, Federal and other granting agencies, and applicable management, and is not intended to be and should not be used by anyone other than these specified parties. CARR, RIGGS & INGRAM, LLC Clearwater, Florida May 19, 2023 32 INDEPENDENT ACCOUNTANTS’ REPORT ON COMPLIANCE WITH SECTION 218.415, FLORIDA STATUTES To the Honorable Chair and Trustees Clearwater Community Redevelopment Agency We have examined the Clearwater Community Redevelopment Agency (“Agency”), compliance with the requirements of Section 218.415, Florida Statutes, Local Government Investment Policies, during the year ended September 30, 2022. Management is responsible for the Agency’s compliance with the requirements. Our responsibility is to express an opinion on the Agency’s compliance with the specified requirements based on our examination. Our examination was conducted in accordance with attestation standards established by the American Institute of Certified Public Accountants. Those standards require that we plan and perform the examination to obtain reasonable assurance about whether the Agency complied, in all material respects, with the specified requirements referenced above. An examination involves performing procedures to obtain evidence about whether the Agency complied with the specified requirements. The nature, timing, and extent of the procedures selected depend on our judgment, including an assessment of the risks of material noncompliance, whether due to fraud or error. We believe that the evidence we obtained is sufficient and appropriate to provide a reasonable basis for our opinion. We are required to be independent and to meet our other ethical responsibilities in accordance with relevant ethical requirements relating to the examination engagement. Our examination does not provide a legal determination on the Agency’s compliance with specified requirements. In our opinion, the Agency complied, in all material respects, with the aforementioned requirements for the year ended September 30, 2022. This report is intended solely for the information and use of management and the State of Florida Auditor General and is not intended to be and should not be used by anyone other than these specified parties. CARR, RIGGS & INGRAM, LLC Clearwater, Florida May 19, 2023 33 INDEPENDENT ACCOUNTANTS’ REPORT ON COMPLIANCE WITH REDEVELOPMENT TRUST FUND To the Honorable Chair and Trustees Clearwater Community Redevelopment Agency We have examined the Clearwater Community Redevelopment Agency’s (the “Agency”), compliance with the requirements of Sections 163.387(6) and 163.387(7), Florida Statutes, Redevelopment Trust Fund, during the year ended September 30, 2022. Management of the Agency is responsible for the Agency’s compliance with those requirements. Our responsibility is to express an opinion on the Agency’s compliance with the specified requirements based on our examination. Our examination was conducted in accordance with attestation standards established by the American Institute of Certified Public Accountants. Those standards require that we plan and perform the examination to obtain reasonable assurance about whether the Agency complied, in all material respects, with the specified requirements referenced above. An examination involves performing procedures to obtain evidence about whether the Agency complied with the specified requirements. The nature, timing, and extent of the procedures selected depend on our judgment, including an assessment of the risks of material noncompliance, whether due to fraud or error. We believe that the evidence we obtained is sufficient and appropriate to provide a reasonable basis for our opinion. We are required to be independent and to meet our other ethical responsibilities in accordance with relevant ethical requirements relating to the examination engagement. Our examination does not provide a legal determination on the Agency’s compliance with specified requirements. In our opinion, the Agency complied, in all material respects, with the aforementioned requirements for the year ended September 30, 2022. This report is intended solely for the information and use of City Council, management and the State of Florida Auditor General and is not intended to be and should not be used by anyone other than these specified parties. CARR, RIGGS & INGRAM, LLC Clearwater, Florida May 19, 2023 34 CLEARWATER COMMUNITY REDEVELOPMENT AGENCY AUDIT PRESENTATION FOR YEAR ENDED SEPTEMBER 30, 2022 JUNE 12, 2023 2 •Independent Auditors’ Report on basic financial statements –Unmodified opinion •Government Auditing Standards Report –No material weaknesses or significant deficiencies or other instances of noncompliance •Management Letter –No findings to communicate AUDITORS’ REPORT AND LETTER 3 •Local Government Investment Policies Report –No significant issues noted •Report on Compliance with Redevelopment Trust Fund –No significant issues noted AUDITORS’ REPORTS AND LETTER, cont. 4 •Significant accounting policies –No significant changes to accounting policies, policies can be seen in the footnotes •Accounting estimates –Receivables allowance, fair value of investments, risk management accruals, pension and OPEB plans, and estimated useful lives of capital assets •Significant difficulties encountered in the audit –No significant difficulties in dealing with management •Disagreements with management –No disagreements arose during the course of the audit •Other findings or issues –None noted •Corrected and uncorrected misstatements –None noted •Issues discussed with management prior to retention –None noted •Internal control deficiencies –None noted OTHER COMMUNICATIONS 5 QUESTIONS? Cover Memo City of Clearwater Main Library - Council Chambers 100 N. Osceola Avenue Clearwater, FL 33755 File Number: ID#23-0719 Agenda Date: 6/12/2023 Status: Agenda ReadyVersion: 1 File Type: Action ItemIn Control: Community Redevelopment Agency Agenda Number: 4.2 SUBJECT/RECOMMENDATION: Approve an allocation of $65,000 to fund art installations within The Mercado. SUMMARY: Staff is seeking approval to allocate $65,000 toward funding of art installations in The Mercado. A total stipend of $75,000 is recommended for this project. The City’s Cultural Affairs budget will provide the remaining $10,000. The east facade of a building in the Mercado, where Cleveland Street meets Gulf to Bay Boulevard, features 4 panel areas and the City has issued a call for artists for a mosaic art installation in that area. There will also be 11 circular planter areas in addition to the mosaic and mural art. Collectively all these surfaces within The Mercado can be transformed to create an immersive public art installation that can be enjoyed from all areas of the plaza space, as well as by cars and people passing the space. APPROPRIATION CODE AND AMOUNT: A third quarter budget amendment will provide a transfer of $65,000 from project R2002, Community Engagement, to project C2105, Mercado - Downtown Gateway. Page 1 City of Clearwater Printed on 6/6/2023 FOR IMMEDIATE RELEASE May 22, 2023 Contact: Amber Brice Arts & Cultural Affairs Coordinator (727) 562-4067 amber.brice@myclearwater.com City of Clearwater Calling for Artists for Multiple Public Art Projects CLEARWATER, Fla. – The Clearwater Public Art & Design Program has multiple public art opportunities for professional artists to design and create artwork on several installations in the city. The city is seeking a muralist to paint two water tanks, a mosaic artist for the Mercado, a new community space in the city’s Downtown Gateway, and a sculptor to build an installation at the new city Fire Station 46 on Clearwater Beach. Countryside Water Tanks: A stipend of $30,000 is available for murals on two public water tanks at 2709 FL-580, in Clearwater’s Countryside neighborhood. The city is looking for an engaging mural or image to beautify the tanks, which are highly visible on a heavy commuter state road. Themes and topics suggested but are not limited to sea life, Florida nature scenes, game fish, seabirds, ospreys, water conservation or a postcard-style mural. “Public Utilities is excited to be able to incorporate something beautiful and engaging onto our water infrastructure for the enjoyment of passersby. This is just the beginning for projects like this,” said Clearwater Public Utilities Director Richard Gardner. Fire Station 46: A stipend of $75,000 is available for the creation of an engaging sculpture with glass elements to add to the visitor experience at this fire station, just steps from world-famous Clearwater Beach. Themes and topics suggested but are not limited to fire elements, water elements, and/or fire station patches that firefighters exchange with other city and state fire departments. The sculpture should also contain a light element, either beneath the base of the sculpture to illuminate from within, or uplighting so passersby can enjoy the sculpture during the day or night. “The Clearwater Beach Fire Station is by far the most visited Fire Station in our city. We want the sculpture to reflect that and be an open invitation to our neighbors and visitors to the area to stop in and say hello,” said Clearwater Fire Chief Scott Ehlers. The Mercado: A $75,000 stipend is available for a mosaic at “The Mercado,” a new community space opening this summer as part of the city’s Cleveland Street Streetscape Phase III and Mercado construction project, bringing major improvements to Cleveland Street and Gulf-to- Bay Boulevard. The east façade of a building in the Mercado, where Cleveland Street meets Gulf-to-Bay Boulevard, features 4 panel areas where the city is seeking a mosaic art installation. There will also be 11 circular planter areas where mosaic and mural art is sought. Collectively all these surfaces within The Mercado can be transformed to create an immersive public art installation that can be enjoyed from all areas of the plaza space, as well as by cars and people passing the space. “The Mercado will soon open as a new community gathering space in the heart of the Downtown Gateway. We look forward to seeing a beautiful mosaic element created that will celebrate and bring the community together,” said Clearwater Community Redevelopment Agency Executive Director Jaye Matthews. To apply and learn more about the opportunities, visit myclearwater.com/arts. ### Cover Memo City of Clearwater Main Library - Council Chambers 100 N. Osceola Avenue Clearwater, FL 33755 File Number: ID#23-0728 Agenda Date: 6/12/2023 Status: Agenda ReadyVersion: 1 File Type: Action ItemIn Control: Community Redevelopment Agency Agenda Number: 4.3 SUBJECT/RECOMMENDATION: Approve Downtown Gateway Business Economic Recovery Grant Program. SUMMARY: Staff is seeking approval to allocate $500,000 to fund the Downtown Gateway Business Economic Recovery Grant Program. The purpose of the Community Redevelopment Agency (CRA) Downtown Gateway Business Economic Recovery Program is to provide one-time economic recovery grants, up to $25,000, to assist business owners/tenants located in the Downtown Gateway Distract on Gulf to Bay Boulevard, solely, that suffered an economic loss directly related to the Cleveland Street Streetscape Phase III project. If approved, grants will be available for up to $25,000 to be used for making rent or mortgage, and/or public utility bill payments on behalf of the business. Grants may be awarded to business owners or tenants of commercial property within the CRA Downtown Gateway District on Gulf to Bay Boulevard. This grant will be awarded to a maximum of 20 applicants. APPROPRIATION CODE AND AMOUNT: Funds are available in project R2003, Economic Development, to fund these agreements. Page 1 City of Clearwater Printed on 6/6/2023 Cover Memo City of Clearwater Main Library - Council Chambers 100 N. Osceola Avenue Clearwater, FL 33755 File Number: ID#23-0729 Agenda Date: 6/12/2023 Status: Agenda ReadyVersion: 1 File Type: Action ItemIn Control: Community Redevelopment Agency Agenda Number: 4.4 SUBJECT/RECOMMENDATION: Approve Restaurant Operations: Essential Equipment Micro-Grant Program. SUMMARY: Staff is seeking approval to allocate $175,000 to fund the Restaurant Operations: Essential Equipment Micro-Grant Program. The purpose of the Community Redevelopment Agency (CRA) Restaurant Operations: Essential Equipment Micro-Grant Program is to provide micro-grants up to $3,500 to assist Food & Beverage (F&B) operators with the purchase or repair of essential equipment needed to effectively operate F&B establishments. Grants may be awarded to brick & mortar, F&B establishments within the Downtown CRA district/footprint. Up to 50 micro-grants will be available if this program is approved. APPROPRIATION CODE AND AMOUNT: Funds are available in project R2003, Economic Development, to fund these agreements. Page 1 City of Clearwater Printed on 6/6/2023 Cover Memo City of Clearwater Main Library - Council Chambers 100 N. Osceola Avenue Clearwater, FL 33755 File Number: ID#23-0730 Agenda Date: 6/12/2023 Status: Agenda ReadyVersion: 1 File Type: Action ItemIn Control: Community Redevelopment Agency Agenda Number: 4.5 SUBJECT/RECOMMENDATION: Approve Façade and Interior Improvement Grant Program. SUMMARY: Staff is seeking approval to allocate $1,000,000 to fund the Façade and Interior Improvement Grant Program. The purpose of the Community Redevelopment Agency (CRA) Façade and Interior Improvement Grant Program is to provide is to provide grants up to $50,000 to assist business owners/tenants in improving the exterior and/or interior of their commercial establishments. Grants are available for up to $25,000 for façade/exterior work, and up to $25,000 for interior work to improve commercial ground floor spaces. Grants may be awarded to business owners or tenants of commercial property within the Downtown CRA district/footprint. APPROPRIATION CODE AND AMOUNT: Funds are available in project R2003, Economic Development, to fund these agreements. Page 1 City of Clearwater Printed on 6/6/2023 Cover Memo City of Clearwater Main Library - Council Chambers 100 N. Osceola Avenue Clearwater, FL 33755 File Number: ID#23-0533 Agenda Date: 6/12/2023 Status: Agenda ReadyVersion: 1 File Type: Action ItemIn Control: Community Redevelopment Agency Agenda Number: 4.6 SUBJECT/RECOMMENDATION: Approve additional FTE to CRA for Fiscal Year 22/23. SUMMARY: Staff is seeking approval to add one FTE. This position will be for an additional CRA Specialist, who will focus on Stakeholder Engagement and Relations, and will serve under the supervision of the CRA Manager - Programs. If the additional FTE is approved, staff will prepare an action item for a future budget amendment in July. APPROPRIATION CODE AND AMOUNT: Per future budget amendment. Page 1 City of Clearwater Printed on 6/6/2023