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8.3 Comp Annual Fin Report
G~~~ OF DUB~~ '"~~~%~ STAFF REPORT CITY C L E R K DUBLIN CITY COUNCIL File # ^©0®-~® DATE: February 2, 2010 TO: Honorable Mayor and City Councilmembers FROM: Joni Pattillo, City Manager SUBJE Comprehensive Annual Financial Report (CAFR) and Annual Audit For The Fiscal Year Ending June 30, 2009 And Extension of Agreement With Caporicci and Larson Prepared By: Paul S. Rankin, Administrative Services Director. EXECUTIVE SUMMARY: The City of Dublin has compiled and published its Comprehensive Annual Financial Report (CAFR), for the fiscal year ending June 30, 2009. This report includes financial statements prepared by City Staff along with the audit prepared by Caporicci and Larson (C&L), the independent auditors selected by the City Council. The CAFR is a report which encompasses information beyond what the minimum requirements. The Auditors have provided a "clean opinion" based on their review. The report has also been reviewed by the City Council ad-hoc Audit Subcommittee comprised of Councilmember Biddle and Councilmember Hart. FINANCIAL IMPACT: Detailed financial information is summarized in this report as well as the Comprehensive Annual Financial Report (Attachment 2). The cost of Audit Services for the year ending June 30, 2010 under an extension of the current Agreement are proposed not to exceed $40,000 including the cost of a Federal Single Audit. RECOMMENDATION: 1) Receive the reports and confirm the establishment of the fund balances as stated for the year ending June 30, 2009; and 2) Authorize the City Manager to execute an extended Agreement with Caporicci and Larson in an amount not to exceed $40,000. lf` Submitted By: Reviewe By: Administrative Services Director Assistant anager Page 1 of 5 ITEM NO. ~. / DESCRIPTION: The City of Dublin has compiled and published its Comprehensive Annual Financial Report (CAFR) for the Fiscal Year ending June 30, 2009. This report, which is included as Attachment 2, includes audited financial statements reviewed by Caporicci and Larson, CPA's (C&L). This firm is the independent auditor selected by the City Council and this is the sixth year that C&L has conducted the financial audit for the City. AD-HOC AUDIT COMMITTEE REVIEW The Auditors also met with the City Council Ad Hoc Audit Committee (Councilmember Don Biddle and Councilmember Kevin Hart) on January 25, 2010 to review the results of the audit. The interaction of the Auditors directly with representatives of the elected body is a key component to current audit standards. The Committee members were provided with an opportunity to discuss the report and ask questions of the Auditor. Overall, based on their testing and review the Auditors granted the City a "clean opinion." In order to receive this level of audit finding there can be no matters of concern, involving the City's internal controls and financial reporting, that are considered to be a material weakness. The timing of the current audit occurred after the City had converted records to the new Tyler- Eden Financial Accounting system. Staff brought to the attention of the Committee two follow-up items 1) Future changes in accounting standards. 2) Preparation of the Fiscal Year 2009/2010 Audit. The upcoming changes in Accounting Standards will require a change in the format in which fund balance and reserves are presented. As the City moves forward with the preparation of the Fiscal Year 2010/2011 Budget Staff will be bringing forward a comprehensive review with regard to fund balance and reserve policies. The second item relates to a recommendation to delay obtaining proposals for Audit Services and to request a one year extension from Caporrci & Larson, with a one year option. With this extension the city will have used the firm a maximum of eight years. The delay in the change will allow Staff to solidify the new accounting software for an additional year and have the audit work performed by a firm familiar with the City Account structure. It is also anticipated that a special Single Audit will need to be performed based on the anticipated receipt this year of in excess of $500,000 in Federal funds. Staff have discussed the costs associated with the extension of the agreement with Ahmed Badawi, Partner Caporicci and Larson. The cost of Audit Services similar to those provided this year would be $36,000. C&L's original agreement for the 2003/2004 Fiscal Year was $30,450 and they have maintained that cost for the six previous audits which they prepared. Given that costs have increased since 2004 and the auditing requirements have changed a fee adjustment would be considered reasonable at this time. In addition to the base audit costs it is expected that the City will need a Federal Single Audit. The cost of that component is $4,000 for a total fee not to exceed $40,000. The Ad-Hoc Committee was supportive of both proposals. Page 2 of 5 FINANCIAL OVERVIEW The financial section of the CAFR includes an unqualified opinion issued by C&L. Attachment 1 provides a summary of key elements contained in the CAFR. Some of the important Financial results are addressed below: Total Assets The total assets also include $36.9 million (7.9% of the total) which are subject to external restrictions on how they can be used. Although Net Assets is one method of measurement it is also important to consider non-financial factors such as: changed in property tax values; sales tax outlets; and the condition of infrastructure in terms of how well it is maintained. Although it is only a small decrease, what is significant is that this is the first time over the last eight years that the Net Assets reported have decreased. Using the budget and more detailed data the it will be prudent for the City Council to remain aware of these trends and to evaluate policies that will assure that expenditures and revenues can be balanced. Item Current and other assets Capital assets Total assets June 30, 2009 $121,031,495 423,474,384 544,505,879 Governmental Activities June 30, 2008, $ Change % Change Restated $136,714,378 ($15,682,883) -11.5% 411,619,671 11,854,713 2.9% 548,334,049 (3,828,170) -0.7% Other liabilities Total Liabilities Invested in capital assets Restricted Unrestricted (See Note 8 to Financials for Council Designations) Total net assets 16,822,439 17,468,882 (646,443) -3.7% 16,822,439 17,468,882 (646,443) -3.7% 423,474,384 411,619,671 11,854,713 2.9% 36,906,687 48,572,719 (11,666,032) -24.0% 66,597,197 68,456,077 (1,858,880) -2.7% $526,978,268 $528,648,467 ($1,670,199) -0.3% DESIGNATIONS OF FUND BALANCES One part of the closing entries recorded on the financial statements is the designation of funds for specified uses. A complete listing of both fund reserves and designations for all funds is shown on page 42 of the report. A "Reservation" implies that there is a strong legal basis which restricts the discretion of the City Council to use the funds for any desired purpose. A "Designation" is less restrictive and subject to policy decisions by the City Council. Some of the key designations are discussed below. A. Designation For Authorized Expenditures This designation is established to allow the City Council to carryover any unused funds as of June 30, 2009, to serve as a catastrophic and emergency reserve. To the extent that any of these funds remain in reserves the interest from investments becomes a general fund revenue source. The total reserved fund balance (Equity) in the General Fund decreased from the balance presented in the prior Fiscal Year. There were not any general fund revenues in excess of reserves that can be designated for a special use. Page3of5 B. Other General Fund Designations of Fund Balance The City Council is requested to confirm these designations as part of accepting the final audit report. The current CAFR includes designations made by the City Council following the acceptance of the June 30, 2008 CAFR. As a result of the Fiscal Year 2008-2009 financial results, key changes in the reported designations in the General Fund include: 1) The designation for Economic Stability was increased to $5,868,847 from $2,970,722, based on City Council action appropriating surplus funds from prior years. The current year budget draws from this source of funds in order to balance the budget as the City is projecting General Fund expenses in excess of revenues collected in Fiscal Year 2009-2010. 2) The long-term advance to the Fire Impact Fee Fund from the General Fund increased as a result of interest costs exceeding the fees collected. 3) The long-term advance for the PERS Side Fund was reduced by $318,578. 4) The amount designated for CIP Carryovers was increased by $800,223 for projects underway that will be completed in a subsequent Fiscal Year. 5) Anew designation in the amount of $301,874 is included for Operating Carry- overs approved by the City Council. This reduced the designation for Economic Stability as the operating carry-overs essentially reflect the need to use reserves to complete activities initiated as part of the Fiscal Year 2008-2009 Budget. 6) The prior designation for Fallon Park Artificial Turf Fields of $1,120,000 has been relabeled as "Fallon Park Fee Advance" and increased to $4,221,930, based on action taken by the City Council to proceed with the project prior to collection of Public Facility Fee Funds. This advance is an estimate only, until the construction is complete, and will need to be repaid with interest from future development fees. 7) The previous designation for the Heritage Park Development of $3.18 million was reduced to $2,215,658 based on expenditures incurred in Fiscal Year 2008-2009. 8) The Maintenance Facility Improvement designation was established at $750,625 to reflect the cost to refurbish the former 84 Lumber site. 9) Based on City Council action appropriating surplus funds from prior years: New designations of $1 million for Emerald Glen Recreation and Aquatic Center Change in Scope; and $210,000 for local emergency radio system costs were established; and the designation for Fire Retiree Health Liabilities was increased from $500,000 to $750,000. These designations do not reflect the anticipated full costs required, however it is considered a means to work towards funding goals. 10) The designation increased for the unrealized Investment Market Value Adjustment. The City is required to calculate the market value of investments as of June 30, 2009. Although the Market Value was more than the current book value the City did not realize the gain, as that would require liquidating the investments. By isolating the $2,334,061 in a separate reserve it helps to identify that these are not funds available to spend. Page 4 of 5 11) The General Fund amount "Designated For Authorized Expenditures" in the current CAFR is $33,474,209. This reflects a 21 % decrease from the amount presented one year ago. The dramatic decrease is impacted by the City Council allocation of funds to specific reserves as described above as well as the need to draw from reserves to balance the budget. The format for the presentation of fund balance will be changing based on new accounting requirements. Staff will be bringing forward in the next several months additional recommendations with regard to fund balance and reserve policies. AUDIT RECOMMENDATIONS /DISCLOSURES The professional standards adhered to by the Auditors require them to record a formal process of communicating with the City Council. The new standards require that the Auditors communicate directly with those charged with governance. As noted the Auditors met with the Ad-Hoc Committee at the conclusion of the audit to review the final report. As part of the Audit Review the independent auditors can present recommendations for consideration by the City. These can be items that do not impact the overall "clean opinion". Rather the process allows the Auditors to disclose their observations on certain practices and policies, and allow Management to respond to the input. There are three categories which the auditors will issue as part of the Management Letter. The labels used are standardized throughout the accounting industry and the comments provided with this audit were in the least severe of the three categories. As part of their work in preparing the financial statements for the period ending June 30, 2009, the City has restated certain balances for the previous year. This is explained in Footnote No. 15 on page 54 of the CAFR. The auditors disclosed in the management letter (Attachment 3) the restatement of items from the previous year. Staff prepared a response which is incorporated in Attachment 3 and it includes "Action Items" for each of the items that were restated. The implementation of the new software system will provide additional tools to capture transactions in a common system that did not previously exist. The largest item in terms of monetary value was the refund of monies collected to construct the Fallon Interchange. The refund was a requirement of the funding agreement and the nature of the financing was unique. The amount of the refund exceeded the Fiscal Year 2008-2009 Traffic Impact Fee Revenue collected. By restating the prior year revenue anomalies in the 2008-2009 results were avoided. NOTICING REQUIREMENTS/PUBLIC OUTREACH: Copy To: Ahmed Badawi, Partner Caporicci & Larson ATTACHMENTS: 1. Summary -Key Information Comprehensive Annual Financial Report For the Year Ended June 30, 2009. 2. Separate Booklet- City of Dublin Comprehensive Annual Financial Report -Fiscal Year 2008-2009 3. Report to the City Council and Management for the year ended June 30, 2009. Page 5 of 5 l ~~~~ SUMMARY -KEY INFORMATION COMPREHENSIVE ANNUAL FINANCIAL REPORT FOR THE YEAR ENDING JUNE 30, 2009 1. The Comprehensive Annual Financial Report (CAFR) includes audited financial statements reviewed by Caporicci and Larson, CPA's (C&L) 2. The Auditors "Clean Opinion" provides a high level of assurance based on testing Financial Statements fairly represent the City's financial position. 3. Information included in a CAFR exceeds the minimum amount of information required for a financial audit. 4. The CAFR format will allow the City to apply for a Certificate of Achievement from the Government Finance Officers Association. The goal is to provide financial information of the highest quality. 5. ORGANIZATION OF REPORT i. Transmittal letter (pages v - ix). (Provides a general overview of the components which make up the report. ii. Opinion issued by the Independent Auditor is included on pages xv and xvi. iii. Management Discussion and Analysis (MD&A) Page xvii and continuing to page xxx, is required by GFOA. Provides and overview of the financial activities, with a focus on significant trends, as well as major changes associated with the City's major funds (i.e. General Fund and Impact Fee funds). iv. Financial Statements A significant portion of the CAFR is comprised of financial statements and schedules for the various funds used to account for the City's revenue and expenditures. Pages 5 and 6, include a Government Wide Statement of Net Assets which is similar to financial statements presented by private corporations. It is important to keep in mind the unique nature of government services and what is reported as assets. For example, land dedicated for streets and parks, infrastructure, and public buildings are reported as part of the Non-current Assets retained by the City. This category is $423 million (80%) of Total Assets. These are not liquid assets available to fund programs or on-going activities. v. Statistical Section Pages 115 - 139 comprise the unaudited statistical section of the CAFR includes graphs of relevant historical data. 8,3 ala)~o ATTACHMENT 1 Page 1 of 2 a o~ i SUMMARY -KEY INFORMATION COMPREHENSIVE ANNUAL FINANCIAL REPORT FOR THE YEAR ENDING JUNE 30, 2009 6. Reserves A complete listing of both fund reserves and designations for all funds is shown on page 42 of the report. i. A "Reservation" implies that there is a strong legal basis which restricts the discretion of the City Council to use the funds for any desired purpose. ii. A "Designation" is less restrictive and subject to policy decisions by the City Council. 7. AUDIT RECOMMENDATIONS /DISCLOSURES As part of the Audit Review the independent auditors can present recommendations for consideration by the City. The process allows the Auditors to disclose their observations on certain practices and policies, and allow Management to respond to the input. a. Restatement of Prior Balances Disclosed: As part of their work in preparing the financial statements for the period ending June 30, 2009, the City has restated certain balances for the previous year. This is explained in Footnote No. 15 on page 54 of the CAFR. The Auditor also discussed this as part of their letter to Management. City Management has developed an Action Plan for each Item which was identified by the Auditor. ATTACHMENT 1 Page 2 of 2 ~~i ATTACHMENT 2 IS A SEPARATE BOUND BOOKLET: City of Dublin Comprehensive Annual Financial Report For the Fiscal Year Ended June 30, 2009 4~ia~ 1 City of Dublin Comprehensive Annual Financial Report Fiscal Year 2008-2009 %/i 19 Shannon Community Center S~ iga City of Dublin Dublin, California Comprehensive Annual Financial Report For the year ended June 30, 2009 ~ ~i~a City of Dublin Comprehensive Annual Financial Report For the year ended June 30, 2009 Table of Contents Page INTRODUCTORY SECTION Table of Contents ............................................................................................................................................................... i Letter of Transmittal ......................................................................................................................................................... v Government Finance Officers Association (GFOA) Award ...................................................................................... xi Principal Officers ............................................................................................................................................................. xii ... Orgaruzahonal Chart .....................................................................................................................................................xm FINANCIAL SECTION Independent Auditors' Report .................................................................................................................................... xv Management's Discussion and Analysis .................................................................................................................xvii Basic Financial Statements: Government-Wide Financial Statements: Statement of Net Assets ...................................................................................................................................... 5 Statement of Activities and Changes in Net Assets ........................................................................................ 6 Fund Financial Statements: Governmental Fund Financial Statements: Balance Sheet .................................................................................................................................................. 8 Reconciliation of the Governmental Funds Balance Sheet to the Government-Wide Statement of Net Assets ..........................................................................11 Statement of Revenues, Expenditures and Changes in Fund Balances ...............................................12 Reconciliation of the Governmental Funds Statement of Revenues, Expenditures and Changes in Fund Balances to the Government-Wide Statement of Activities and Changes in Net Assets .........................................................................14 Proprietary Fund Financial Statements: Statement of Net Assets ..............................................................................................................................15 Statement of Revenues, Expenses and Changes in Net Assets .............................................................16 Statement of Cash Flows ............................................................................................................................17 Fiduciary Fund Financial Statements: Statement of Fiduciary Net Assets ............................................................................................................18 Index to Notes to Basic Financial Statements .......................................................................................................19 Notes to Basic Financial Statements ....................................................................................................................... 21 i City of Dublin Comprehensive Annual Financial Report For the year ended June 30, 2009 Table of Contents, Continued ~~6 ~ ~a ~u Pale FINANCIAL SECTION, Continued Required Supplementary Information: Budgets and Budgetary Accounting ............................................................................................................... 58 Schedule of Revenues, Expenditures and Changes in Fund Balances -Budget and Actual: General Fund ................................................................................................................................................ 59 Housing and Noise Mitigation Special Revenue Fund .......................................................................... 60 Schedule of Funding in Progress: Miscellaneous Plan of the California Public Employee Retirement System ....................................... 61 Other Post Employment Benefit (OPEB) .................................................................................................. 61 Supplementary Information: General Fund: Schedule of Budget Versus Actual Revenues by Sources ............................................................................ 67 Schedule of Budget Versus Actual Departmental Expenditures ................................................................ 69 Major Funds: ,~,. Schedule of Revenues, Expenditures and Changes in Fund Balances -Budget and Actual: Traffic Impact Fees Capital Projects Fund "'° ............................................................................................... 71 Public Facilities Fees Capital Projects Fund ............................................................................................ 72 Public Art Fees Capital Projects Fund ...................................................................................................... 73 Fire Impact Fees Capital Projects Fund "" .................................................................................................... 74 Non-Major Governmental Funds: Schedule of Revenues, Expenditures and Changes in Fund Balances -Budget and Actual: ~° Combining Balance Sheet ........................................................................................................................... 78 Combining Statement of Revenues, Expenditures and Changes in Fund Balances .......................... 82 -- ;; ~ ~- i~~ City of Dublin Comprehensive Annual Financial Report For the year ended June 30, 2009 Table of Contents, Continued Page FINANCIAL SECTION, Continued rf,~ Supplementary Information, Continued Non-Major Governmental Funds, Continued: Schedule of Revenues, Expenditures and Changes in Fund Balances -Budget and Actual: Special Criminal Activity Special Revenue Fund ................................................................................. .. 86 Vehicle Abatement Special Revenue Fund ............................................................................................ .. 87 Supplemental Law Enforcement Special Revenue Fund ..................................................................... .. 88 ~.~ Traffic Safety Special Revenue Fund ...................................................................................................... .. 89 EMS Special Revenue Fund ..................................................................................................................... .. 90 State Gas Tax Special Revenue Fund ...................................................................................................... .. 91 ~+ T.E.A. Special Revenue Fund ................................................................................................................... .. 92 Measure B Sales Tax Transportation Special Revenue Fund .............................................................. .. 93 Measure B Sales Tax Bike and Pedestrian Special Revenue Fund ..................................................... .. 94 Traffic Congestion Relief Special Revenue Fund .................................................................................. .. 95 Measure D Recycling Special Revenue Fund ........................................................................................ .. 96 Local Recycling Program Special Revenue Fund ................................................................................. .. 97 .,,~ Garbage Service Special Revenue Fund ................................................................................................. .. 98 East Bay Regional Park District Special Revenue Fund ....................................................................... .. 99 CDBG Special Revenue Fund .................................................................................................................. 100 g ~ g p ~ ................................................................................................... Street Li htm S ecial Revenue Fund 101 Stagecoach Landscape Special Revenue Fund ...................................................................................... 102 Dougherty Landscape and Lighting Special Revenue Fund ............................................................... 103 ,,,, Santa Rita Assessment District 97-1 Special Revenue Fund ................................................................ 104 East Dublin Street Lighting Assessment Special Revenue Fund ........................................................ 105 Alameda County Congestion Management Agency Special Revenue Fund ................................... 106 g Y ~' ~ ~ p ) .............................................................................. Hi hwa Safe Traffic Reduction Bond Pro 1B 107 Internal Service Funds: g ............................................................................................................. ~" Combinm Statement of Net Assets 110 Combining Statement of Revenues, Expenses and Changes in Net Assets ............................................111 Combining Statement of Cash Flows ............................................................................................................112 Agency Fund: Statement of Changes in Net Assets ..............................................................................................................114 ~. iii City of Dublin Comprehensive Annual Financial Report For the year ended June 30, 2009 Table of Contents, Continued g~ ~~a Page "~ w~ STATISTICAL SECTION General Governmental Activities Tax Revenues by Source and Governmental Activities Tax Revenues by Source ..................................................................................... 116 Net Assets by Component ..................................................................................................................................... 117 ". Changes in Net Assets ........................................................................................................................................... 118 Fund Balances of Governmental Funds .............................................................................................................. 120 Changes in Fund Balances of Governmental Funds ......................................................................................... 122 "" Assessed Value and Estimated Actual Value of Taxable Property ................................................................. 124 Direct and Overlapping Property Tax Rates ...................................................................................................... 125 Principal Property Taxpayers ............................................................................................................................... 126 Property Tax Levies and Collections ................................................................................................................... 127 ~: Direct and Overlapping Dept ............................................................................................................................... 128 Legal Debt Margin Information ........................................................................................................................... 130 Demographic and Economic Statistics ................................................................................................................ 132 Property Value, Construction and Bank Deposits ............................................................................................. 133 Principal Employers ............................................................................................................................................... 134 ~"" Full-time Equivalent City and Contact Government Employees by Function .............................................. 135 ~ Operating Indicators by Function ........................................................................................................................ 136 Capital Assets Statistics by Function ................................................................................................................... 137 "'" Top 25 Sales Tax Producers ................................................................................................................................... 138 ~: Miscellaneous Statistical Data ............................................................................................................................... 139 Independent Auditors' Report on Compliance and on Internal Control over Financial Reporting Based on an Audit of Basic Financial Statements Performed in Accordance '" With Government Auditing Standards ........................................................................................................141 ~ .a .,. ;~, ,.. ion ~Sa CITY OF DUBLIN 100 Civic Plaza Dublin, California 94568 Website: www.ci.dublin.ca.us December 1, 2009 Honorable Mayor and Members of the City Council Presented with this transmittal is the City of Dublin (City) Comprehensive Annual Financial Report . (CAFR) for the year ended June 30, 2009. The information in this Comprehensive Annual Financial Report is prepared in accordance with Generally Accepted Accounting Principles (GAAP) as established by the Governmental Accounting Standards Board (GASB). The responsibility for the accuracy and fairness of this report rests with the City. Management Staff are responsible for preparing a complete report which is based upon reliable information. Caporicci & Larson, a firm of licensed public accountants, has issued an unqualified ("clean') opinion on the City of Dublin s financial statements for the year ended June 30, 2009. The independent auditor's report has been included in this Comprehensive Annual Financial Report. This letter of transmittal is designed to assist with an individual's review of the City's financial statements. Specifically it is intended to offer the reader useful information in assessing the economic conditions ;~ impacting the City of Dublin. It also complements a separate narrative section called Management's Discussion and Analysis (MD&A) which provides financial highlights of the City and additional analysis of trends reported as part of the financial statements. The MD&A is located immediately following the report of the independent auditors. CITY PROFILE The City of Dublin was incorporated in 1982 and is located in Alameda County, a growing area in the eastern portion of the San Francisco Bay Area. The City has a permanent staffing level of approximately 83 City employees and serves an estimated population of 47,922, with estimated population growth to 60,000 covering a land area of 14.01 square miles. The City's strategic location offers opportunities for employers, retail outlets, and high quality residential neighborhoods. The City operates under the Council-Manager form of government. Policy making and legislative authority are vested in the City Council, which consists of an elected Mayor, who serves atwo-year term and four Council members each elected to a four-year term. The City Council is responsible for the City's ordinances, operating resolutions, adoption of the annual budget, hiring the City Manager and City Attorney and confirming the appointments made by the Mayor to commissions and committees. The City Manager is responsible for the following activities: implementing the policies, ordinances, and directives of the City Council; overseeing the day-to-day operations of the City; and appointing the Directors of the City's departments. Current City services include: Administrative Services (Finance/Information Systems); City Manager and °~ Central Services (Human Resources); City Attorney; City Clerk; Police; Fire; Animal Control; Crossing Guards; Community Development (Building/Planning/Housing); Economic Development; Parks and Community Services; and Public Works (including Engineering and Maintenance). The City contracts with both public agencies and private firms to provide a variety of key services including: Building Inspection; Fire; Police; and Public Works maintenance. A total of 122 FTE contract employees are identified in the City budget. Area Code (925) City Manager 833-6650 City Council 833-6650 Personnel 833-6605 Economic Development 833-6650 Finance 833-6640 Public Works /Engineering 833-6610 Parks & Community Services 833-6645 Police 833-6670 r Planning /Code Enforcement 833-6610 Building Inspection 833-6620 Fire Prevention Bureau 833-6606 v ~i~ i ~a ECONOMIC CONDITION AND OUTLOOK The City of Dublin is located at the intersection of Interstates 580 and 680 approximately 35 miles east of a~. San Francisco. The City has a wide range of housing types available to meet the demands of various employers throughout the region. Over the past several years residential builders and developers have +~~ constructed a variety of new housing opportunities, which includes a mix of transit oriented development ,pry adjacent to a Bay Area Rapid Transit (BART) station as well as single family homes and condominium / townhome developments. The relatively close proximity to additional job centers and colleges and universities in the Bay Area create an attractive environment. .. The City has a large retail base which serves local residents as well as those in surrounding communities. The largest employers include: government and public agencies such as the United States Government - ~~, Department of Justice, County of Alameda, and the Dublin Unified School District; corporate and technical production offices such as the headquarters of Sybase, Micro Dental Laboratories, and Zeiss Meditec; retailers such as Best Buy, Toys R US, Lowes, and Target; and auto dealers with new car dealers in the City ,~ representing the following manufacturers: Chevrolet, Nissan, Honda, Toyota, Volkswagen, Chrysler, Dodge, Jeep, Buick, GMC, Cadillac, Kia, and Saturn. .~ Retail Sales are an obvious indicator of the general economic climate. The General Fund Sales Tax in Fiscal Year 2008/2009 decreased by 15.6% over the amount attributable to the prior year ($14.2 million in Fiscal •~ Year 2007/ 2008 vs. $12.0 million in Fiscal Year 2008/ 2009). This occurred at a time when retail sales in general were slowing. The composition of sales tax generated from outlets located in the City is also heavily weighted to automobile sales which have deteriorated dramatically nationwide. During the year, .•~ the City also experienced the closure of several major retailers including: Mervyns, Circuit City, Expo Design (Home Depot), and Dublin Ford. The City is proactive in monitoring retail sales activity and impacts on the general operating budget. „~ Over the past several years, the City has experienced property tax related growth as a result of both residential and non-residential development. During Fiscal Year 2007/ 2008 the City continued to issue .~ final inspections on a number of residential projects. However, the volume of new permits slowed as the housing industry began to struggle with decreased demand for new homes, decreased availability of mortgages and general recessionary trends. The total number of new residential units receiving a final ~- inspection declined by 71 % from the previous year (235 units in Fiscal Year 2008-2009 compared to 798 in ~ Fiscal Year 2007-2008). The City Council does not control property tax rates. These rates are an outgrowth of the 1978 voter approved Proposition 13. Although the City has experienced significant growth in Assessed Valuation of properties, in recent years, the current slowdown in sales, decreasing home prices, and increase in .- foreclosure activity are expected to stifle property tax growth. In the past, the City had new development occurring on vacant properties that carried a low base value and development was occurring at a heavy pace. These conditions fueled increases in Assessed Valuation which averaged 7.5% for the five-year ..~ period from Fiscal Year 2004/05 through Fiscal Year 2008-2009. In turn, the increase in Assessed Valuation resulted in increases in Property Tax Revenue with $12.3 million collected in Fiscal Year 2004-2005 and $18.5 million in Fiscal Year 2008-2009. ,., The amount of growth in Property Tax Revenue, in the current economic cycle, has deteriorated rather abruptly. As noted above the five-year trend for Assessed Valuation had grown an average of more than .~ 7% per year during the last five years. However, the Fiscal Year 2008-2009 General Fund Property tax Revenue increased by approximately 4.7%. Due to declines in property values and reassessments, the Fiscal Year 2009-2010 Budget was prepared based on a negative adjustment to the total Assessed Valuation. .~ ..~ ~'~ Unemployment trends nationwide have been increasing and this has an impact on large retail purchases, housing foreclosures and general economic health. It is not expected that Dublin will be immune from these impacts. The most recent unemployment data available for Dublin did show an increase (2.8% in 2007 and 3.7% in 2008). However, the City's unemployment rate for 2008 was below the Alameda County average of 6.2%. The stability of the City both funding and expenditures is also significantly impacted by State of California budget impacts and retirement system trends. The State of California has, for the last several years, been late in adopting an annual budget, thus impacting the City's ability to budget with assurance certain .~~. revenues used for operations. Following the adoption of the City Fiscal Year 2009-2010 budget in June 2009, the State invoked a provision in the law that allows the State to borrow $2 million of the City's local property taxes. In November of 2009, the City participated in a statewide financing that will allow the City °°~ to receive the revenue in the same Fiscal Year and the State of California will absorb all costs associated with the financing including the interest owed. °~' The California Public Employees Retirement System (Ca1PERS) has notified participating agencies of anticipated rate increases beginning in Fiscal Year 2011-2012 as a result of market losses incurred with the retirement portfolio. The timing of Ca1PERS actuarial reports used to set rates result in a lag in the relationship to asset losses and when rates adjust. Retirement benefits and funding are a topic of discussion throughout the State as the costs begin to consume larger portions of funds available. The City Manager is participating in discussions with public agency executives throughout the region in order to evaluate options and opportunities to address the concern in a comprehensive manner. The future economic outlook for the City is expected to show continued deterioration of slower growth in terms of new construction and retail sales. This environment requires the City to carefully plan for an alignment of General Fund expenditures with General Fund Revenue. In taking a long term view the City will continue to take steps to enhance and rebuild the economic base. This will include seeking ^~ opportunities for expansion and adding diversity to the current retail base and preparing long-term plans such as the Downtown Specific Plan, which is underway. Within the next year, the City is also expected to be served by access to a second Bay Area Rapid Transit (BART) station now under construction in the vicinity of the retail area impacted by recent retail closures. This transit link, along with along-term plan for the area, will provide the foundation for continued improvements in the overall community. ~= In taking along-term view, the City will continue to take steps to enhance the existing economic base, while seeking opportunities for expansion and adding diversity to the current retail base. The City has exciting regional serving retail projects approved, such as The Green on Park Place, the Promenade, and Fallon Gateway. There is also the ability to accommodate significant new development projects in the City's Eastern Dublin Specific Plan Area, as evidenced by several development agreements entered into with the Alameda County Surplus Property Authority and the developers for Dublin Ranch during the past several fiscal years. There is also additional planned development adjacent to older commercial areas as a second Bay Area Rapid Transit (BART) station is now under construction and should offer service in Fiscal Year 2010-2011. FINANCIAL PLANNING AND POLICIES +~ The City Council adopts a 10 Year Strategic Plan which is updated every two years. The strategies, as well as more specific annual Goals and Objectives, establish the framework and overarching policy focus for the ~` delivery of public services to the community. The Budget document has a section containing the Strategic Plan and Goals and Objectives. Quarterly updates are also provided to the City Council on the Goals and Objectives. vii ~3~ ~$a The City of Dublin operates with balanced budgets each year, and as provided for in City policies, the City Manager presents a recommended budget and Financial Plan to the City Council annually. The City Council adopts a final budget in advance of the July 1St start of the new Fiscal Year. In terms of major capital investments, the City operates utilizing apay-as-you-go philosophy and has no outstanding City debt. The financial policies currently used for budgeting also provide for the use of Internal Service funds to assure resources are available to finance the replacement of public safety vehicles and apparatus, computer systems, and some building components. The City has also proactively financed contributions to fund long-term retiree medical liabilities. The City of Dublin has benefited in recent years from General Fund Revenues in excess of Reserves. The City Council policy has been to assess the use of such additions to the General Fund reserves only after the finalization of the prior year figures in the Comprehensive Annual Financial Report (CAFR). The amount is also evaluated net of accounting related entries such as any unrealized adjustment for the market value of investments. The actions have been taken in public with a deliberate focus on using these funds for one- time and not on-going operating expenses. In recent years, this has made available discretionary funding to proceed with significant public improvement projects including the reconstruction of the Shannon Community Center; expansion and development of the Historic Park; and acquisition of a facility to support maintenance activities for the growing City. In Fiscal Year 2008-2009, the City Council also proceeded with the construction of Phase 1 of the Fallon Sports Park. Although a grant offset a small portion of the overall cost, the majority of the project is funded from development fees. The City obtained a competitive bid which was less than the original estimate; however, with the slow-down in the collection of development fees, the bid could not be awarded without a contingent financing plan that would borrow funds from the General Fund in the event Development Fee collection is insufficient in Fiscal Year 2009-2010. It is projected that the loan required may be approximately $4 million and will be repaid with interest. The addition of the facility will also impact operating costs beginning in Fiscal Year 2010-2011. The City Council also postponed further work on design of the Emerald Glen Park Recreation and Aquatic Complex. From the start of the Fiscal Year 2008-2009, Staff identified in the Budget Transmittal the uncertainty of State funding and the need to potentially consider adjustments including the deferral of General Fund Capital projects. The rapid deterioration of major revenues, including sales tax, required the City to be proactive in implementing corrective measures during Fiscal Year 2008-2009. Throughout the year, the City Manager established a policy to review all staff vacancies and some positions were left vacant. As part of the mid-year budget review, General Fund revenue projections were decreased by approximately $2.5 million. This was net of an unbudgeted one-time $1 million Community Benefit contribution provided as part of a long-term Development Agreement by the Wallis Ranch development. Operating expenses in the General Fund were reduced mid-year by $1 million. The City also deferred discretionary General Fund Capital projects which did not impact public health and safety. These steps were all critical in preparing for the Fiscal Year 2009-2010 Budget. In the Fiscal Year 2009-2010 Budget, the City Council approved a reorganization plan that included staffing cuts and the reassignment of personnel where needed to fill critical vacancies. The Budget also addressed anticipated funding reductions using a variety of approaches including: operating expenditure reductions; elimination of the Fiscal Year 2009-2010 cost of living and performance pay adjustments for City Staff; reduced frequencies for some maintenance activities; and the postponement of capital projects. The Budget in Fiscal Year 2009-2010 was balanced with a contribution of approximately $1.1 million from the Economic Uncertainty Reserve. i~ ~ i~a '~' As part of prudent planning for fiscal stability, the City Council has allocated resources as part of the Fiscal Year 2009-2010 Budget to complete a financial forecasting tool and to undertake community polling to assess the potential support for enhanced revenues. It is anticipated that any further reductions in ~' expenditures will likely have a more noticeable impact to City Services. In addition to reducing expenditures, the City has adopted policies aimed at business attraction and creatively reducing the impact from City fees. This includes limited term programs that: allow for large new businesses to participate in a ""' sales tax sharing arrangement based on improvement costs; changing the timing that certain fees are paid from the time of permit to the time of occupancy; and declaring a moratorium on public art fees collected from residential developments. It is recognized that these are tough economic times for public agencies, as well as those that they serve. The financial policies and efforts are intended to support the City Mission Statement which states: The City °~ of Dublin remains committed to promote and support a high quality of life which ensures a safe and secure environment that fosters new opportunities. AWARDS The Government Finance Officers' Association (GFOA) has recognized the City of Dublin for its ' Comprehensive Annual Financial Report covering the period ending June 30, 2008. A copy of the award from this entity is included in this report. This award represents the 19th consecutive year that the City's report was recognized by the GFOA. In order to be recognized, the City was required to produce an easily readable and efficiently organized report. The report must also meet the standard for generally accepted accounting principles and legal requirements. ACKNOWLEDGMENTS The preparation of this report would not have been possible without contributions from City Staff in several departments. The value placed by City Staff in assuring that the City finances are professionally administered is appreciated. The City is fortunate to have dedicated staff members who devote extensive time and energy in preparing such a comprehensive report. The City has had its financial reports recognized by GFOA for many years, which is a significant accomplishment. Staff also appreciates the professional effort and input provided by the independent auditors of Caporicci & Larson, Certified Public Accountants. The City Council is recognized for its continued support and encouragement. Staff intends for the report to be a source of pride and accomplishment; representing excellence in financial reporting and exemplifying the high priority given to the provision of quality services. Sincerely, Joni Pattillo City Manager ix ~~t ~.Q.~ Paul S. Rankin Administrative Services Director /~~1~~~ k W This page intentionally left blank. ~> a ~::., Y l6 ~ lga Certificate of Achievement for Excellence in Financial Reporting Presented to City of Dublin California For its Comprehensive Annual Financial Report for the Fiscal Year Ended June 30, 2008 A Certificate of Achievement far 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, cE aaF, i ~Qa~~'rOF 1HF ~ tE4Tt yS~UTES ~ cm4ro~a b~ s President ~~O ST XL `\o.S GgC1Gs Executive Director x~ / ~ ~ ~g~ .~ .~ CITY OF DUBLIN PRINCIPAL OFFICERS June 30, 2009 Mayor Tim Sbranti Vice Mayor Kasie Hildenbrand Councilrnember Kevin Hart ADMINISTRATION PERSONNEL City Manager Assistant City Manager Administrative Services Director City Attorney City Clerk Chief of Police Public Works Director Community Development Director Park & Community Services Director Fire Marshal .w. .~ ~. .., ~: .~ ~~ Councilmember Don Biddle ~' Councilmember Kate Ann Scholz '~ Joni Pattillo Chris Foss Paul Rankin ~' john Bakker „~ Caroline Soto Casey Nice Melissa Morton Jeri Ram ~., Diane Lowart Bonnie Terra '"" ~;. .~. .~ ~,.. ilk l~ i. illli~ lip l~ r ~ l~ r ~ l~ ~ ~ ~ l~ ~ ~ l~ Legend ^ Bected Appointed Volunteers City Staff CITY OF DUBLIN ORGANIZATIONAL CHART Heritage & I rarKS t~ ~ommu Cultural Arts Services f nmmiccinn Commission City Manager City Clerk Elections Planning City Commission Attorney Assistant City Manager Central Services Youth Senior Human Resources Advisory Center Disaster Preparedness Committee Advisory Waste Management (':nmmi#rsa Community Cable TV Housing Police Services Community Parks & Administrative Public Works Development Community Services Services Building Management Police Building & Safety Recreation Finance Traffic Signals Animal Control Planning Library Services Information Street Lighting Housing Cultural Activities Systems/ Street Maintenance Heritage Center Technology Street Sweeping Street Tree Maintenance Dublin Cemetery Parks & Facilities Mgmnt Street Landscaping Maint Child Care Park Maintenance Fire Services p~ ~J i9y~ isa This page intentionally left blank. '~ .~ ,ter xiv CL Caporicci & Larson Certified Public Accountants INDEPENDENT AUDITORS' REPORT To the Honorable Mayor and Members of the City Council of the City of Dublin Dublin, California ao~.g~ We have audited the accompanying financial statements of governmental activities, each major fund, and the aggregate remaining fund information of the City of Dublin, California (City), as of and for the year ended June 30, 2009, which collectively comprise the City's basic financial statements as listed in the table of contents. These financial statements are the responsibility of the City's management. Our responsibility is to express an opinion on these basic financial statements based on our audit. We conducted our audit in accordance with generally accepted auditing standards in the United States and the standards applicable to financial audits contained in Government Auditing Standards, issued by the Comptroller General of the United States. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the basic financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the basic financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall basic financial statement presentation. We believe that our audit provides a reasonable basis for our opinion. In our opinion, the basic financial statements referred to above present fairly, in all material respects, the financial position of the governmental activities, each major fund, and the aggregate remaining fund information of the City as of June 30, 2009, and the respective changes in financial position and cash flows, where applicable, thereof for the year then ended in conformity with generally accepted accounting principles in the United States. Subsequent to the basic financial statements date of June 30, 2009 and the year then ended, the State of California (State) has borrowed, deferred paying certain revenues and proposed taking other funds from local governments including City of Dublin. These actions by the State include: • 8% of Property Taxes borrowed-to be repaid in 3 years • Gas Tax payments deferred-to be paid after January 1, 2010 These above amounts are very significant to the local governments and may affect their ongoing operations. Certain lawsuits are in process to stop such State actions. The State legislation is also in process to aid local governments to be able to sell from a Joint Powers Authority the 8% of property taxes borrowed by the State. For more detailed information, see Note 17 attached in the Notes to Basic Financial Statements. As described in Note 1 to the basic financial statements, the City adopted Statement of Governmental Accounting Standards Board No. 55, the Hierarchy of Generally Accepted Accounting Principles for State and Local Governments and No. 56, Codification of Accounting and Financial Reporting Guidance Contained in the AICPA Statements on Auditing Standards. Toll Free Ph: (877) 862-2200 Oakland Orange County 180 GrandAve., Sui[e 1365 9 Corporate Park, Suite 100 Oakland, California 94612 Irvine, California 92606 Toll Free Fax: (866) 436-0927 Sacramento San Diego 777 Campus Commons Rd., Suite 200 4858 Mercury, Suite 106 Sacramento, California 95825 San Diego, California 92111 ai ~ isa To the Honorable Mayor and Members of the City Council of the City of Dublin Dublin, California Page 2 In accordance with Government Auditing Standards, we have also issued our report dated December 21, 2009, on our consideration of the City's internal control over financial reporting and on our tests of its compliance with certain provisions of laws, regulations, .contracts, and grants. 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 accompanying Required Supplementary Information, such as Management's Discussion and Analysis, budgetary comparison information and other information as listed in the table of contents are not a required part of the basic financial statements but are supplementary information required by the Governmental Accounting Standards Board. We have applied certain limited procedures, which consisted principally of inquiries of management regarding the methods of measurement and presentation of the Required Supplementary Information. 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. The accompanying supplementary information is presented for purpose of additional analysis and is not a required part of the basic financial statements. The Supplementary Information 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 relation to the basic financial statements taken as a whole. The introductory section and statistical tables have not been subjected to the auditing procedures applied in the audit of the basic financial statements and accordingly, we express no opinion on them. Oakland, California December 21, 2009 .~ xvi as ~ Aga G~~~OF Dp~~'G CITY OF DUBLIN 19!~~ `82 ~ `~~,~'w~~ Management s Discussion and Analysis (MDA) June 30, 2009 O~LlFOR~~~ ,~ As management of the City of Dublin (City), we offer readers of the City's financial statements this narrative overview and analysis of the financial activities of the City for the fiscal year ended June 30, 2009. Please read this overview in conjunction with the accompanying letter of transmittal and the accompanying basic financial statements. OVERVIEW OF THE FINANCIAL STATEMENTS This discussion and analysis is intended to serve as an introduction to the City's basic financial statements, which are comprised of three components: • Government-wide financial statements -These include the Statement of Net Assets and Statement of Activities. These statements provide information about the activities of the City as a whole and about the overall financial condition of the City in a manner similar to a private- sector business. • Fund financial statements -These statements provide additional information about the City's major funds, including how services were financed in the short term and fund balances available for financing future projects. • Notes to the Financial Statements -The notes provide additional detail that is essential to a full understanding of the information provided in the government-wide and fund financial statements. In addition to the basic financial statements and accompanying notes, this report also presents certain n required supplementary information concerning the City's progress in funding its obligation to provide pension benefits to its employees. GOVERNMENT-WIDE FINANCIAL STATEMENTS -DESCRIPTION These statements include all assets and liabilities of the City using the accrual basis of accounting, which is similar to the accounting used by most private sector companies. All current year s revenues and expenses are accounted for regardless of when the cash is paid or received. ~` These statements report the City's net assets and changes in them. Net assets -the difference between assets and liabilities -are one way to measure the City's financial position. Over time, increases or decreases in net assets are among indicators used to assess whether the financial condition of the City is ~' improving or deteriorating. However, it is also important to consider other non-financial factors, such as: changes in the City's property tax values; sales tax outlets; and the condition of the Cit~s infrastructure (i.e. parks and streets), to accurately assess the overall health of the City. The Government-Wide statements present information about the City's activities, all of which are considered governmental in nature. These include services provided for police, fire, community development, streets and culture and leisure. These services are funded from monies received from property, sales, and other taxes, direct charges for services provided, grants, contributions from other agencies and impact fees collected from new development. xvii a3 ~-~ l ga GOVERNMENT-WIDE FINANCIAL STATEMENTS -ANALYSIS 0 As shown in Table 1, during Fiscal Year 2008-2009, the City's net assets, representing the difference between total assets and total liabilities, decreased by $1.6 million (0.3%) to $527 million from $529 million, as restated for Fiscal Year 2007-2008. Factors which contributed to the decrease were: expenditures for capital improvement projects; less capital impact fees collected as a result of declines in development activity; and ~" a reduction in tax revenue. Table 1 below summarizes the year to year change in the net assets reported for ,~ the City of Dublin. TABLE 1 SUMMARY OF NET ASSETS June 30, 2009 and 2008 (Restated) Governmental Activities Item Current and other assets Capital assets Total assets Other liabilities Total Liabilities Invested in capital assets Restricted Unrestricted (See Note 8 to Financials for Council Designations) Total net assets June 30, 2008, June 30, 2009 Restated $ Change % Change $ 121,031,495 $ 136,714,378 $ (15,682,883) -11.5% 423,474,384 411,619,671 11,854,713 2.9% 544,505,879 548,334,049 (3,828,170) -0.7% 16,822,439 17,468,882 (646,443) -3.7% 16,522,439 17,468,882 (646,443) -3.7% 423,474,384 411,619,671 11,854,713 2.9% 36,906,687 48,572,719 (11,666,032) -24.0% 66,597,197 68,456,077 (1,858,880) -2.7% $ 526,978,265 $ 528,648,467 $ (1,670,199) -0.3% The current assets decreased by approximately $15.7 million compared to the balance reported in the previous year. This decrease was offset by $11.8 million in capital assets and reflects the use of cash reserves during the year to construct and acquire capital assets. The City's total liabilities of $16.8 million represents primarily obligations outstanding for current operations (such as accounts payable), capital projects (such as retention payable), deposits held for development projects, and compensated absences. The decrease in the current year is primarily due to the difference in scope and timing of accounts payable for capital projects, as well as a decrease in deposits held for developer project processing. A significant portion of the City's net assets ($423 million or 80.4%) reflects its investment in capital assets (e.g. land, infrastructure, buildings, equipment). The City uses these capital assets to provide services to citizens; consequently, these assets are not available for future spending. $36.9 million or 7% of the assets as of June 30, 2009 represent resources that are subject to external restrictions on how they may be used. These restrictions may be imposed by outside agencies, state regulations, or legal restrictions which would limit the discretionary use of these assets. xviii s~ w~., .. w:.. a~ d~ /~a Unrestricted net assets ($67.3 million or 12.6%) may be used to meet the City's ongoing obligations to citizens and creditors. However, as discussed in the notes to the financial statements, much of the unrestricted net assets include the unreserved portion of General Fund balance which has either been designated for future equipment replacement, or that has been designated by the City Council for use on several future projects and to cover economic uncertainties. The unrestricted net assets show a decrease of ., $1.9 million (-2.7%) compared to the restated amount for Fiscal Year 2007-2008. This represents the City's use of reserve funds in Fiscal Year 2008-2009 to offset the decline in General Fund Revenue, as well as the acquisition of a site that can be used for an expanded corporation/ maintenance yard. Governmental Activities The charts on the following pages Table 2 provides a summary of major expenditure program categories, program revenues used to fund specific expenditure programs, and ~~ general City revenues available for funding all City programs. Total revenues from all sources were $72.0 million and total expenditures for all City programs were $73.6 million. For Fiscal Year 2008-2009, the City had no long term debt outstanding at June 30, 2009. This format provides additional detail showing factors .» that impacted the Net Asset figures presented in Table 1. Table 2 -Summary of Changes in Net Assets For the Years Ended June 30, 2009 and 2008 (Restated) Fiscal Year Ending June 30th 2008, as 2009 Restated $ Change % Change Revenues: Program Revenues Charges For Services $ 11,850,629 $ 12,155,377 $ (304,748) -2.5% Operating Contributions & Grants 2,245,945 2,747,497 (501,552) -18.3% Capital Grants & Contributions 14,599,068 37,393,930 (22,794,862) -61.0% General Revenues Property Taxes 23,311,587 22,229,039 1,082,548 4.9% Sales Tax 12,001,338 14,225,661 (2,224,323) -15.6% Motor vehicle in lieu, unrestricted 160,242 197,245 (37,003) -18.8% ' Other Taxes 3,011,925 3,504,501 (492,576) -14.1% Investment income, unrestricted 4,266,601 4,399,908 (133,307) -3.0% Other general revenues 461,137 1,202,074 (740,937) -61.6% Total Revenues 71,908,472 98,055,232 (26,146,760) -26.7% Expenses: Governmental Activities General government 8,721,545 7,790,286 931,259 12.0% Public safety 23,880,635 23,282,634 598,001 2.6% ,~ Highways and streets 20,368,655 20,196,496 172,159 0.9% Health and welfare 1,869,428 1,689,353 180,075 10.7% Culture and leisure services 11,563,136 12,200,759 (637,623) -5.2% ,;~ Community development 7,175,272 8,276,993 (1,101,721) -13.3% Total governmental activities expenses 73,578,671 73,436,521 142,150 0.0% Increase in net assets (1,670,199) 24,618,711 - 0.0% Net assets - beginning of year, restated 528,648,467 507,069,022 - 0.0% Prior Period Adjustment - (3,039,266) - 0.0% Net assets -end of year, restated $ 526,978,268 $ 528,648,467 $ (1,670,199) 0.3% xix a5 ~ ~~'a The $1.6 million decrease in net assets this fiscal year is largely attributable to decreased capital contributions from development impact fees and taxes, as well as increased expenditures for capital projects. A discussion of key Revenue and Expenditure factors is presented below. `~ Revenues Overall, total revenues decreased by $26.1 million or -26.7%, for the period ending June 30, 2009 compared ,,,~ to the previous Fiscal Year (as restated). The following are the major factors which contributed to these results. "~ Charges for Services decreased by approximately $0.3 million less than the previous year. This primarily reflects the slowdown in development activity and fewer development applications under review. Overall, Capital Contributions and Grants decreased by $22.8 million. There have been a variety of factors that contributed to this change including: A) In Fiscal Year 2007-2008 a significant lump sum contribution towards the construction of the Interstate 580 / Fallon Road Interchange. B) If you exclude contributions related to the I-580 Fallon Interchange, developer contributions of Traffic Impact Fees were $1.2 million less in Fiscal Year 2008-2009. C) In the previous year, the City received one-time grants totaling approximately $950,000 that were used on the Dougherty Road /Dublin Boulevard intersection improvement project. D) Developer payments to the Public Facility Fee Fund decreased by $4.1 million. Property Taxes increased by approximately $1.1 million based upon increased assessed valuations resulting from changes in the market value of properties as well as new construction being added to the tax roll. The rate at which property tax revenue has grown has been declining as development has slowed and properties where development occurred had a higher base value. Sales Tax revenue decreased by approximately $1.4 million. The deterioration has been rapid and reflects the closure of major retail outlets as well as a significant decline in new automobile sales. Other Taxes also decreased by approximately $500,000. This decline primarily reflects the economic conditions which resulted in fewer real estate transfers and declines in the transient occupancy tax collected from hotels. Investment income decreased approximately $133,000, which primarily represents decreased investment yields compared to the previous year as well as declining balances invested, due to the expenditure of funds for significant capital projects. The comparison of the total reported as earnings is somewhat masked by a $1.72 million unrealized adjustment to reflect the market value of investments as of June 30, 2009. In the previous year, the unrealized investment gain was approximately $1.5 million. Program Expenses Overall, total expenses were relatively flat with Fiscal Year 2008 - 2009 being approximately $142,150 more than the previous year. The total expenses reported as of June 30, 2009 were $73.6 million. XX ~~ ~' /~a The following table summarizes the differences in expenses in order to observe the fluctuation between components. ANALYSIS OF MAJOR COMPONENTS CONTRIBUTING TO CHANGE IN EXPENSES (Fiscal Year 2008-2009 Compared To Fiscal Year 2007-2008, Restated) ., Governmental Internal Capital Year Ending Fund Program Service Asset Total June 30 Expenses Funds Auditions Depreciation Other Expenses 2009 $ 50,041,794 $ 963,919 $ 8,136,840 $ 14,325,258 $ 110,860 $ 73,578,671 2008 49,189,652 537,079 7,805,618 15,766,762 137,410 73,436,521 '~ Difference 2009 vs. 2008 852,142 426,840 331,222 (1,441,504) (26,550) 142,150 Overall Governmental Fund Expenses increased by only $142,150. This represents a 0.2% increase and generally reflects increased costs associated with providing services consistent with the previous year. The expenses associated with Internal Service Funds increased by approximately $426,840 in the current Fiscal Year. This is increase is primarily related to expenditures to replace the City computerized Finance, Accounting, Permit, and Licensing systems. The addition of Capital Assets increased by $331,222 which was an increase of 4.2% over the previous year. ~. The combined amount for the two years reflects the significant activity with Capital Projects and Developer dedications. Due to the fact that completion of capital projects and the acquisition of assets do not follow consistent patterns it is typical to have fluctuations. Depreciation expenses included as part of the financial statements decreased based upon adopted depreciation schedules and the current capital assets. When the a fund governmental statements are presented they do not present general fund capital assets. A reconciliation Statement of the Governmental Funds Balance Sheet to the Government-Wide Statement of Net Assets is included as part of the CAFR Report. The Charts on the following page display both the Revenue and Expenses by program in a pie chart format. .~ This highlights the proportionate elements of the Fiscal Year 2008-2009 Revenues and Expenses. As shown in the Revenue Chart the largest source is contributions of capital and grants accounting for 38.1 %. Property Taxes and Sales tax represented 22.7% and 14.5% respectively. In terms of expenses the largest program expense is Public Safety representing 31.7%, followed by Highways and Streets which represented 27.5%. Culture and Leisure was the third largest program expense representing 16.6%. Expenses in both Highways and Streets and Culture & Leisure included capital projects. "~ xxi ~ ~ Aga 1 Revenues By Source (In Millions) Total Revenue $72 Million Other Taxes - 3.1% $2.2 Sales Tax - 17.8°/ .P~12.R ~_, Op Contrib /Grants - 3.1% $2.2 Investment Income - _ 5.9% $4.3 Other Revenues - 0.9% $0.6 Capital./Grants - 20.3% $14.6 xxii Property Taxes - 32.4% $23.3 ~ g ~b ~~~ FUND FINANCIAL STATEMENTS These statements provide more detailed information about the City's major funds. 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 City, like other state and local governments, uses fund accounting to ensure and demonstrate compliance with finance-related legal requirements. All of the funds of the City can be divided into three categories: governmental funds, proprietary funds, and fiduciary funds. Governmental funds 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 goverrunent-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 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 City maintains twenty-six individual governmental funds. Information is presented separately in the governmental fund balance sheet and in the governmental fund statement of revenues, expenditures, and changes in fund balances for the following six funds: General Fund; Housing and Noise Mitigation Special Revenue Fund; and four Capital Project Funds: (Traffic Impact Fees, Public Facilities Fees, Public Art Fees, •~ and the Fire Impact Fees). These funds either qualify or the City requested them to be classified as major funds due to their significance in the financing of new capital assets. Data from the other twenty governmental funds are combined into a single, aggregated presentation. Individual fund data for each of <~ these non-major governmental funds is provided in the form of combining statements elsewhere in this report. _~ The City adopts an annual appropriated budget for each of its governmental funds. A budgetary comparison statement has been provided for each governmental fund to demonstrate compliance with this budget. Proprietary funds The City maintains one type of proprietary fund. Internal service funds are an accounting device used to accumulate and allocate costs internally among the City's various functions and to build up reserves for future replacement of capital assets. These funds are also used to collect funds for future retiree medical costs, which are then transferred to a trust. In Fiscal Year 2006-2007, the City established a component related to the pre-payment of the Public Employees Retirement System side fund ~' obligation. Charges are made to departments based on payroll to fully recover advanced retirement payment over time. The City uses five internal service funds to account for its fleet of vehicles, computer systems, other furniture and equipment, certain retiree costs and contributions, and improvements to City "~ buildings. Because these services solely benefit the governmental function, they have been included within governmental activities in the government-wide financial statements. ~' Proprietary fund financial statements provide the same type of information as the government-wide s financial statements, only in more detail. All five internal service funds are combined into a single, aggregated presentation in the proprietary fund financial statements. Individual fund data for the internal `'~ service funds is provided in the form of combining statements elsewhere in this report. ~„ xxin a9~ igd Fiduciary Funds The fiduciary fund section consists of three Agency Funds. The Dublin Boulevard Extension Agency Fund is an improvement district with outstanding bonds. The City's role is that of a trustee, or fiduciary, in collecting assessments and remitting bond payments. The City has no legal, contingent or moral obligation for the repayment of this debt and merely ensures that the assets received are used for their intended purposes. In Fiscal Year 2008-2009 the City also provided a similar role for two Geologic Hazard Abatement Districts (GHAD). California Public Resources Code section 25670 establishes that these Districts are a political subdivision of the State and not an agency or instrumentality of a local agency. The City contractually provides support to collect funds in a fiduciary capacity and may also arrange for activities funded by the Districts. In Fiscal Year 2006-2007 the City transferred a lump sum of $5.5 million to an irrevocable trust to provide retiree medical benefits The City has continued each year to make contributions based upon an actuarial study to the Trust. The financial status of the third party Trust is not included as part of the City's financial statements. These fiduciary activities are excluded from the City's fund financial statements because these assets cannot i be used to finance operations. The activity for these funds, however, is provided for in a separate combining statement contained elsewhere in this report. FINANCIAL ANALYSIS OF THE GOVERNMENT'S FUNDS As of June 30, 2009, the City's governmental funds reported combined ending fund balances of $94.9 r million, a decrease of $14 million over the prior year (as restated). The City General Fund had a decrease of .~ $1.3 million; Capital Funds decreased by $13.3 million; Housing Fund increased by approximately $106,538 and Non-Major Funds increased by only $470,057. The following sections provide a more detailed financial analysis by fund type. „~ GENERAL FUND The General Fund is the chief operating fund of the City. At the end of Fiscal Year 2008-2009, unreserved ~ fund balance of the General Fund was $56.8 million and total fund balance of the General Fund was $63.1 million. As discussed in Note 8 to the financial statements, the entire amount of unreserved fund balance .~ has been designated by the City Council for: use on several future projects, carryover funding for projects ~ not completed in the previous year, and to cover economic uncertainties. During Fiscal Year 2008-2009, the General Fund expenditures exceeded its revenues by $1.3 million. These ~, results include the recording of $1.7 million as revenue from the "Change in Market Value of Investments." A separate designation has been established for the investment portfolio gains which were not realized at June 30, 2009. Net of this adjustment the General Fund expenses exceeded revenues by $3.02 million. In the ,,~, preparation of both the Fiscal Year 2008-2009 Budget and the Fiscal Year 2009-2010 Budget it was projected that there would be revenues exceeding expenses. The City Council has approved the use of reserves from the Economic Stability designation to balance expenditures. A total of $301,874 was required in Fiscal Year 2008-2009. The Fiscal Year 2009-2010 Budget '°' includes the use of $1,085,426 from the Economic Stability Reserve. ~, The total expense in the General Fund during Fiscal Year 2008-2009 was $5.6 million more than the previous "" year. Included in this amount was the use of reserves designated for high priority capital projects including: the acquisition of a corporation /maintenance yard site and development of the Historic Park. 30 ~ 1 ~a HOUSING FUND The Housing Fund is a special revenue fund which accounts for funds associated with the Affordable Housing programs. This fund is also used to account for Noise Mitigation funds collected as a mitigation measure under the original Eastern Dublin Specific Plan, to mitigate noise impacts on existing residential properties. Several of the subject properties have been redeveloped without the need to make mitigation improvements. The fund balance totaled $12,962,048 at June 30, 2009 compared to $12,855,510 a year earlier. The minimal change reflects the slow-down in development activity resulting in the collection of additional fees. Expenses were also partially offset by the repayment of loans made by this fund to facilitate the private development of housing opportunities at the Fairway Ranch Project. CAPITAL PROJECT FUNDS As previously described the City has included four specific capital funds in the information presented as part of the governmental funds. Traffic Impact Fee Fund -This fund includes fees collected to construct major traffic improvements necessary to facilitate development. Fees are levied and collected on development in proportion to its impact on the transportation needs. Total revenue collected in Fiscal Year 2008-2009 was only $1.5 million, which was approximately $10 million less than collected in the prior year. The significant decrease reflects decreased development activity and the fact that in the previous year there was a large contribution made to fund the Interstate 580 / Fallon Road Interchange. The City also expended $2.1 million more than in the previous fiscal year. Significant expenditures were made to address the on-going construction on the Interstate 580 / Fallon Road Interchange. Because these funds are collected for construction or improvements the entire $11.9 million fund balance is reserved for designated capital projects. Public Facilities Fee Fund -This fund includes fees collected to develop parks and other public facilities. Total revenue collected in Fiscal Year 2008-2009 was $1.7 million less than the amount collected in the prior year. This is representative of the slowdown in development projects which are subject to the fees. The City also expended $553,037 more than in the previous fiscal year. The spending is reflective of the initiation of the construction phase for the Fallon Sports Park, which was awarded March 17, 2009. Due to variations in project construction and acquisition timelines expenditure patterns will fluctuate from year to year. Because these funds are collected for construction or improvements the entire $3.8 million fund balance is reserved for designated capital projects. Public Art Fees -This fund includes fees collected under the zoning ordinance to further the development of public art in the community. Total revenue collected in Fiscal Year 2008-2009 was $122,668 less than the amount collected in the prior year. The City expended only $16,943 during the current Fiscal Year, related to artwork repairs, redesign, and preliminary art selection. In Fiscal Year 2009-2010 it is expected that fabrication of artwork adjacent to the Bay Area Rapid Transit station will be underway. Because these funds are collected solely for Public Art the entire balance of $375,779 is reserved for this purpose. xxv 3/ ~ lg.~ Fire Impact Fees -This fund includes fees collected from new development to pay for the capital cost associated with the provision of Fire Services. Total revenue collected in Fiscal Year 2008-2009 was only $58,966 which was $30,657 more than the amount collected in the prior year. In Fiscal Year 2008-2009 more development occurred on properties which did not hold credits from prior contributions. Therefore they were required to pay cash at the time of receiving a building permit. The expenses associated with these funds represent the repayment of a long term advance made from the City General Fund. In Fiscal Year 2008-2009 the amount owed to the General Fund increased because the annual collections were less than the accrued interest on the outstanding balance. The total balance owed to the General Fund as of June 30, 2009 is $1,841,336. NON-MAJOR FUNDS The City's non-major funds are presented in the basic financial statements in the aggregate. At June 30, 2009 these funds had a total fund balance of $5,544,433. The full amount has been reserved under the following programs: Recycling Programs $283,926; Public Safety Programs $381,644; Street Maintenance & Construction $3,856,928; Health & Welfare programs $577,149; and Capital Improvement Projects $444,786. More information about these aggregated non-major funds can be found in the combining statements following the required supplementary information. GENERAL FUND BUDGETARY HIGHLIGHTS Over the course of the year, the City Council revised the City budget with adjustments that generally fall ~ into one of the following three categories: • Changes made to adjust appropriations for capital project carryovers from the prior year. • Changes made in the mid year report to adjust revenues and augment current year appropriations. ,~ • Other revenue and expenditure adjustments approved after the original budget was adopted. In the General Fund total actual revenues exceeded the final budget by $3.1 million. Overall this ~, represented a 6.3 % deviation. It should be noted that $1.7 million of this deviation is related to the market adjustment for investments, which was not realized as of June 30, 2009. Net of this adjustment the ~ deviation was only 2.8%. Expenses were approximately $7.6 million less than the amount budgeted. ~, Capital projects contributed significantly to these results. If the $5,416,870 related to capital projects is excluded, budgeted operating expenses were only $2.2 million less than the budget. With the capital ""` expenditures the savings includes the impact from projects being carried over to Fiscal Year 2009 - 2010 as ,~. well as project cost savings. .~ ~~ ~~ /g~ A summary of the budgetary comparison schedule for the General Fund is shown below. The complete schedule as required is included in the supplementary information following the notes to the financial statements. Budget Amounts Actual Variance with Original Final Amounts Final Budget - REVENUE: Taxes $ 40,139,378 $ 36,659,332 $ 38,177,685 $ 1,518,353 Licenses and permits 2,304,675 1,903,875 1,623,029 (280,846) `"~ Fines and forfeitures 138,900 138,900 143,220 4,320 Use of Money & Property 2,555,078 2,140,078 2,547,707 407,629 Investment Adjustment (Market Value) - - 1,719,960 1,719,960 Intergovernmental 1,002,700 956,173 416,007 (540,166) Charges for service 5,779,709 5,751,709 6,116,417 364,708 Other revenue 1,272,118 3,224,015 3,183,863 (40,152) Total Revenue $ 53,192,558 $ 50,774,082 $ 53,927,888 $ 3,153,806 EXPENDITURES: General government 6,332,761 6,338,280 5,923,895 (414,385) Public safety 24,248,947 23,892,220 22,933,987 (958,233) Highways and streets 2,298,841 2,362,857 2,313,349 (49,508) Health and welfare 65,425 65,425 65,425 - "~ Culture and leisure 7,744,814 7,774,827 7,612,207 (162,620) A Community development 7,031,306 6,789,836 6,216,750 (573,086) Capital projects 9,518,588 15,587,728 10,170,858 (5,416,870) Total expenditures $ 57,240,682 $ 62,811,173 $ 55,236,471 $ (7,574,702) General Fund Taxes consist of primarily Property Taxes ($23.2 million in Fiscal Year 2008-2009) and Sales Taxes ($12.0 million in Fiscal Year 2008-2009). The final amount collected in property taxes was very close to the budget ($95,771). Based on economic trends the budgets for both Property Taxes and Sales Tax were reduced mid-year by a combined $1.5 million reflecting the economic decline. The final collections for these revenues exceeded the final budget; however, they were still $1.6 million below the budget originally adopted in June 2008. Both revenues are projected to decline in the coming year as property values decrease and the City adjusts to the full year impact of several major retail outlets. Further, with the large volume of City Sales tax derived from automobile related sales, this revenue is expected to continue to be subject to a decline. Licenses and permit revenue had a negative variance from the final budget. This reflected primarily Building permits that had been anticipated. A major residential project adjacent to the new unopened west Dublin BART station encountered financing difficulties and did not proceed with obtaining permits. Some of the declines in this category were anticipated as part of the mid-year analysis, and a reduction was made to reflect the slow-down in new development. The City was also able to reduce contract inspection ~~ expenses in the Community Development Department to reduce the impact of the decline in revenue. It is important to note that permit fees can be paid in one fiscal year with the inspection expenses incurred H across multiple years, so this will also have an impact on Fiscal Year 2009-2010. Use of money and property also had a positive budget variance at year end. This was attributable to higher interest rates and a larger balance invested as well as increased rental of City facilities. At mid-year budget an adjustment was made to decrease interest revenue, based on what was perceived as rapidly declining interest rates. The rate of decline tapered off and the final results as of June 30, 2009 were very close to the initial budget. ~, xxvii 33 ~ l8a The deviation in Charges for Services primarily reflects development processing fees and charges. The projection in the budget estimate was more pessimistic than the final services performed. The nature of the applications being processed were longer term preliminary planning projects, in advance of a project being in a position to obtain actual construction permits. With General Fund Expenditures, all of the operating programs had savings amounting to 4.6% less than the final budget. Factors which contributed to the savings were vacancies in staff positions, savings in contract service costs, a delay in the timing of special studies (such as the Downtown Specific Plan), and a reduction in contract services required as development applications and inspection activities decreased. The overall results among all programs also reflect the effort by City Staff to aggressively manage spending given the reality of the economic recession. CAPITAL ASSET AND DEBT ADMINISTRATION Capital Assets The City's investment in capital assets for its governmental activities as of June 30, 2009, amount to $423.5 million (net of accumulated depreciation). This investment in capital assets includes land and streets right of way, buildings, park and roadway improvements, vehicles and other equipment and construction in progress, as summarized in the schedule bellow. During the current fiscal year, the City's investment in capital assets increased by approximately $12.7 million (3.1 %). Governmental Activities June 30, 2008, June 30, 2009 Restated $ Change % Change Land $ 162,556,224 $ 158,623,470 $ 3,932,754 2.5% Streets right of way 35,425,288 29,778,062 5,647,226 19.0% Construction in Progress 8,001,873 21,522,458 (13,520,585) (62.8%) Infrastructure 345,149,139 324,436,764 20,712,375 6.4% Building and Improvements 68,517,699 57,254,299 11,263,400 19.7% Machinery and Equipment 6,613,085 6,489,500 123,585 1.9% Sub-Total 626,263,308 598,104,553 28,158,755 4.7% Less Accumulated Depreciation (202,788,924) (187,339,750) (15,449,174) 8.2% Total Net of Depreciation $ 423,474,384 $ 410,764,803 $ 12,709,581 3.1% ,~~ , w ~_. ~ ~b ~~a The City had an active Capital Improvement Program with significant progress made on a variety of community assets. Selected major capital activities undertaken during the current fiscal year included the projects listed below: Ca ital Pro'ect Status of Pro'ect Fiscal Year 2008-2009 Ex enditures Shannon Center Reconstruction Completed $ 4,372,606 Maintenance Facili Acquisition Completed $ 3,896,257 Dou her Road /Dublin Blvd. Intersection Improvements Completed $1,576,036 Street Overla and Slurr Seal Maintenance Completed $1,016,916 Park Pla Area Renovations (Sta ecoach) Com leted $ 86,747 San Ramon Road Trail Improvements Completed $ 66,515 Dublin Ranch Parks (Devan Square /Piazza Sorrento) Completed $ 48,864 Interstate 580 / Fallon Rd Interchan e In Pro ress $ 9,069,988 Fallon S orts Park Construction In Pro ress $ 2,513,555 Historic Park Development In Pro ess $ 2,106,833 Street Overla and Slurr Seal Maintenance In Pro ess $ 716,708 St Patrick Wa Extension Between Re Tonal & Golden Gate In Pro ess $ 269,549 Dublin Boulevard Bart Corridor Im rovements In Pro ress $ 228,950 In addition, approximately $12.7 million of street improvements were dedicated to the City by developers during Fiscal Year 2008-2009. Additional information on the City's capital assets can be found in Note 5 of this report. Long-term debt At the end of Fiscal Year 2008-2009, the City had no debt outstanding. State statutes limit the amount of ~ general obligation debt a governmental entity may issue to 15 percent of its total assessed valuation. The current debt limitation for the City is $325.3 million. Additional information on long-term debt is located in note 6 of this report. ECONOMIC FACTORS AND NEXT YEAR'S BUDGETS ~ The economic conditions observed as the Fiscal Year 2009-2010 Budget was prepared suggested continued deterioration of core General Fund revenues for the City. The budget estimated General Fund revenue to be approximately 12.3% less than the estimate for Fiscal Year 2008-2009. The City expects a reduction in ~ both sales tax and property tax revenue. Sales tax had been the bedrock of the City's financial success since incorporation and the projected revenue for Fiscal Year 2009-2010 was projected to be $1.2 million less than the estimated sales tax for Fiscal Year 2008-2009. To address these conditions the structure of the Fiscal Year 2009 - 2010 budget incorporated: a reorganization plan that included staffing cuts; operating budget reductions; elimination of the Fiscal Year 2009-2010 City employee cost of living and performance pay adjustments; adjustments to contract service staffing for development related services; and postponement of capital projects. This has required a dramatic change of course for a City that has experienced significant new growth in recent years. The City Council has continued to be prudent in managing on-going cost increases and focused the programming of reserves for one-time expenditures and financing long-term obligations. The City's use of contract service providers to supplement City Staff has been beneficial especially as the workload decreases; the City can adjust the amount of contract service hours. xxix 3s ~ ~8a Expenditures planned in Fiscal Year 2009-2010 Budget are approximately $5.8 million less than the adopted „~ Fiscal Year 2008-2009 Budget. Of this amount $2.5 million are operating expenditures. Total planned capital project expenses are projected to be $3.3 million less. A significant amount of the expenditures are related to capital projects that will be financed partially from grants, developer contributed improvements, .. or reserves designated for a specific project. The Fiscal Year 2009-2010 Budget includes a net decrease of 14.48 full-time equivalent (FTE) positions compared to the position allocation adopted for Fiscal Year 2008- 2009. A FTE is based on 2,080 hours each and the reduction includes contract service hours. One of the ~. major reasons for the decrease is the slumping economy and slow down in development. In preparing the Fiscal Year 2009-2010 Budget the City Council was advised that the continued ,~ development slump may require that the General Fund loan the Public Facility Fee Fund monies to complete the Fallon Sports Park Phase 1 Improvements. Due to this likelihood the City Council deferred further work on the Emerald Glen Recreation and Aquatic Complex. Decisions on future facilities will also .~ need to take into consideration the maintenance and operation of new facilities during a period when discretionary funding is decreasing. The City Staff are preparing amulti-year forecast to be used as part of the decision making tools available for future budgets. The City Council also approved, as part of the Fiscal Year 2009-2010 Budget, a project to evaluate community support for enhanced revenues. The City Council is presented with information on the costs associated with new programs or higher service levels as part of the annual budget process. This information will be essential in making decisions that take into consideration the City's ability to sustain on- going costs before they are added. It is important to acknowledge that the City does not control many of the conditions that will have a financial impact. This includes the down-turn in the economy, decrease in new development, the real estate lending crisis, and the State Budget. As the City prepared for Fiscal Year 2009-2010, the State had not resolved a major budget deficit. The City identified and aggressively monitored actions under consideration by the State. When the State adopted its budget there were actions which will impact cash flow including the borrowing of local property tax and delaying the distribution of gas tax. The City has adequate reserves to address these events for the current year. However, the City remains vigilant in monitoring revenues and controlling expenses in order to respond with corrections. This includes the City Manager review of all vacancies before they filled. A copy of the adopted Budget and Financial Plan for Fiscal Year 2009-2010 is available online at www.ci.dublin.ca.us. REQUESTS FOR INFORMATION This financial report is designed to provide a general overview of the financial position of the City 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 following address: City of Dublin, Finance Department, 100 Civic Plaza, Dublin, CA 94568. A copy of this financial report is '" also located at the City's website - www.ci.dublin.ca.us. .~- ~ °~ ~~a BASIC FINANCIAL STATEMENTS 1 37 ~ l 8~ - ~. This page intentionally left blank. w. ~. .e, ~. 3~ b~ l8a GOVERNMENT-WIDE FINANCIAL STATEMENTS 3 ~~ ~ ~ ga ~. m This page intentionally left blank. r~, ~. ~o ~ Aga City of Dublin Statement of Net Assets June 30, 2009 Governmental Activities ASSETS Current assets: Cash and investments Restricted cash and investments Accounts receivable Accrued interest receivable Prepaids Total current assets Noncurrent assets: Notes Receivable Net OPEB Asset -City (Note 12.A) Long-term receivable Capital assets (non-depreciable): Land Streets right of way Construction in progress Capital assets (depreciable): Infrastructure Buildings and improvements Machinery and equipment Less accumulated depreciation Total capital assets Total noncurrent assets Total assets LIABILITIES Current liabilities: Accounts payable Accrued wages and other payroll liabilities Deposits payable Contract retention payable Liabilities insurance claims payable Unearned revenue Compensated absences payable -within one year Total current liabilities Noncurrent liabilities: OPEB obligations -Dublin Regional Fire Authority (Note 12.B) Compensated absences Total noncurrent liabilities Total liabilities NET ASSETS Invested in capital assets Restricted for: OPEB Public safety Impact fee projects Highways and streets Health and welfare Total restricted Unrestricted Total net assets See accompanying Notes to Basic Financial Statements. 5 $ 110,266,575 146,200 3,442,056 811,518 114,724,544 4,540,436 516,515 162,556,224 35,425,288 8,001,873 345,149,139 68,517,699 6,613,085 (202,788,924) 429,781,335 544,505,879 11,872,694 334,898 1,162,829 804,162 271,916 2,138,465 237,475 16,822,439 151,065 554,107 705,172 17,527,611 423,474,384 516,515 2,370,686 16,063,937 4,588,941 13,883,123 36,906,687 66,597,197 $ 526,978,268 yl~ Igz City of Dublin Statement of Activities and Changes in Net Assets For the year ended June 30, 2009 Net (Expenses)/ Revenue and Changes in Program Revenues Net Assets Operating Capital Total Charges for Contributions Contributions Program Governmental Expenses Services and Grants and Grants Revenues Activities Governmental activities: General government $ 8,721,545 $ 215,711 $ - $ - $ 215,711 $ (8,505,834) Public safety 23,880,635 1,545,935 324,452 58,966 1,929,353 (21,951,282) Highways and streets 20,368,655 598,542 1,585,945 3,693,325 5,877,812 (14,490,843) Health and welfare 1,869,428 3,050,719 304,990 349 3,356,058 1,486,630 Culture and leisure 11,563,136 1,719,501 30,558 9,628,978 11,379,037 (184,099) Community development 7,175,272 4,720,221 - 1,217,450 5,937,671 (1,237,601) Total governmental activities $ 73,578,671 $ 11,850,629 $ 2,245,945 $ 14,599,068 $ 28,695,642 (44,883,029) General revenues: Taxes: Property taxes 23,311,587 Sales tax 12,001,338 Vehicle license taxes 160,242 Other taxes 3,011,925 Total taxes 38,485,092 Intergovernmental (unrestricted) 225,207 Miscellaneous 235,930 Unrestricted investment earnings 4,266,601 Total general revenues 43,212,830 Change in net assets (1,670,199) Net assets: Beginning of year, as restated (Note 15) 528,648,467 End of year $ 526,978,268 See accompanying Notes to Basic Financial Statements. ~a of iga FUND FINANCIAL STATEMENTS 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 City, except those required to be accounted for in another fund. The Traffic Impact Fees Capital Projects Fund - is used to account for fees received from developers of properties, which can only be used for the design, development and construction of street projects within the City. The Public Facilities Fees Capital Project Fund - is used to account for impact fees received from developers of properties, which can only be used for the design, development, and construction of new public facilities within the City. The Public Art Capital Projects Fund - is used to account for fees received from developers of properties, ,, which can only be used for the design, development, and construction of Public Art projects within the City. The Fire Impact Fees Capital Projects Fund - is used to account for fees received from developers of properties, which can only be used for the design, development, and construction of fire capital expansion projects within the City. The Housing and Noise Mitigation Special Revenue Fund - is used to account for impact fees received _, from developers of properties, which can only be used for the design, development, and construction of citywide affordable housing projects and noise mitigation projects in Eastern Dublin. City of Dublin Balance Sheet Governmental Funds June 30, 2009 ~3 ~ ~ g~ "' Special Revenue Capital Projects Funds .. Housing and Traffic Public «~: Noise Impact Facilities General Mitigation Fees Fees ""'~ ASSETS ~^ Cash and investments $ 66,188,795 $ 12,932,869 $ 12,982,167 $ 4,537,110 s~ Restricted cash and investments - - 146,200 - Accounts receivable 2,803,469 64,627 25,321 - Accrued interest receivable 811,518 - - - Notes Receivable - 4,540,436 - - ~ Due from other funds 130,215 - - - Prepaids 57,531 - - - Long-term receivables - - 1,250,000 - ~"" Advances to ISF PERS Side Fund 2,945,495 - - - Advances to other funds 1,841,336 - - - Total assets $ 74,778,359 $ 17,537,932 $ 14,403,688 $ 4,537,110 ~ LIABILITIES AND FUND BALANCES ~" Liabilities: Accounts payable $ 9,915,251 $ 23,640 $ 563,276 $ 740,988 Accrued wages and other payroll liabilities 334,898 - - - Deposits payable 1,053,392 11,808 97,629 - ~; Contract retention payable 191,079 - 600,747 - Liabilities insurance claims payable 271,916 - - - ~" Deferred Revenue 888,465 4,540,436 1,250,000 - Due to other funds - - - - Advancesfrom other funds - - - - ~ Total liabilities 12,655,001 4,575,884 2,511,652 740,988 ~, Fund Balances: Reserved 5,343,610 12,962,048 11,892,036 3,796,122 Unreserved, designated reported in: General fund 56,779,748 - - - Unreserved, undesignated, reported in: "'~ Capital projects funds - - - - Total fund balances 62,123,358 12,962,048 11,892,036 3,796,122 ..~ Total liabilities and fund balances $ 74,778,359 $ 17,537,932 $ 14,403,688 $ 4,537,110 ~.t. ~, ,~:F ..~ See accompanying Notes to Basic Financial Statements. «.,_ y~ ~ i8a Capital Projects Funds Fire Non-Major Public Art Impact Governmental Fees Fees Funds Total $ 375,779 $ - $ 5,756,516 $ 102,773,236 _ _ - 146,200 - - 544,873 3,438,290 `' _ _ - 811,518 ~~, _ _ - 4,540,436 - - 130,215 ~~+ _ _ - 57,531 _ - - 1,250,000 "" _ _ - 2,945,495 ,~;;~ _ _ - 1,841,336 $ 375,779 $ - $ 6,301,389 $ 117,934,257 ~~~ ~,,, '~ $ - $ - 614,405 $ 11,857,560 _ _ $ - 334,898 "' _ _ - 1,162,829 _ - 12,336 804,162 _ _ - 271,916 °~ _ _ - 6,678,901 ~ - - 130,215 130,215 - 1,841,336 - 1,841,336 - 1,841,336 756,956 23,081,817 375,779 - 5,544,433 39,914,028 _ _ - 56,779,748 "' - (1,841,336) - (1,841,336) '~ 375,779 (1,841,336) 5,544,433 94,852,440 ~* $ 375,779 $ - $ 6,301,389 $ 117,934,257 ~, , 9 This page intentionally left blank. y5 ~ iga ~..: .~ ~., ~ ~~ l8~ "~ City of Dublin Reconciliation of the Governmental Funds Balance Sheet „~ to the Government-Wide Statement of Net Assets June 30, 2009 Fund Balances of Governmental Funds ~ 94 R.,~ ddn Amounts reported for governmental activities in the statement of net assets are different because: Capital assets used in governmental activities are not current financial resources and therefore are not reported in the Governmental Funds Balance Sheet. Non depreciable assets (Land and construction in progress) 195,065,228 Depreciable buildings, property, equipment and infrastructure, net 170,228,210 Total capital assets 365,293,438 Compensated absences payable, are not due and payable in the current period and therefore are not reported in the governmental fund financial statements. (791,582) OPEB obligations are not due and payable in th current period and therfore are not reported in the govermm~tal fund financial statements. (151,065) Deferred revenues recorded in Governmental Fund Financial Statements resulting from activities in which revenues were earned but funds were not available are reclassified as revenues in the Government-Wide Financial Statements. n inn n~~ Internal service funds are used by management to charge the cost of certain activities, such as asset replacement and retiree health care to individual funds. The assets and liabilities of the internal service funds are included in the Government-Wide Statement of Net Assets. F3 ~~4 tim Net Assets of Governmental Activities $ 526,978,268 See accompanying Notes to Basic Financial Statements. ~ 11 y~ ~ Iga City of Dublin Statement of Revenues, Expenditures and Changes in Fund Balances Governmental Funds For the year ended June 30, 2009 Special Revenue Capital Projects Funds Housing and Traffic Public Noise Impact Facilities General Mitigation Fees Fees REVENUES: Property taxes $ 23,164,422 $ - $ - $ - Sales tax 12,001,338 - - - Othertaxes 3,011,925 - - - Intergovemmental 416,007 - - - Licenses and permits 1,623,029 - - - Charges for service 6,116,417 34,732 - - Interest 4,028,586 460,181 655,742 212,011 Use of property 239,081 750,000 - - Fines and forfeitures 143,220 - - - Developer fees - 349 841,221 975,305 Other revenue 3,183,863 16,034 24,770 - Special assessments - - - - Total revenues EXPENDITURES: Current: General government Public safety Highways and streets Health and welfare Culture and leisure Community development Capital outlay: General Health and welfare Community improvement Parks Streets Total expenditures REVENUES OVER (UNDER) EXPENDITURES OTHER FINANCING SOURCES (USES): Transfer in Transfer out Total other financing sources (uses) NET CHANGE IN FUND BALANCES FUND BALANCES: Beginning of year, as restated End of year 5,923,895 59,139 800 - 22,933,987 - - - 2,313,349 - - - 65,425 - - - 7,612,207 - - 1,456 6,216,750 1,102,219 23,592 - 4,203,910 - - 18,046 59,293 - - - 4,126,677 - - 5,072,019 55,236,471 1,161,358 10,942,580 5,091,521 (1,308,583) 99,938 (9,420,847) (3,904,205) 19,632 6,600 - - 19,632 6,600 - - (1,288,951) 106,538 (9,420,847) (3,904,205) 63,412,309 12,855,510 21,312,883 7,700,327 See accompanying Notes to Basic Financial Statements. Y8~ i~a Capital Projects Funds Public Art Fire Non-Major Impact Impact Governmental Fees Fees Funds Total $ _ $ - $ 141,880 $ 23,306,302 _ - 423,203 12,424,541 _ - - 3,011,925 _ - 1,977,146 2,393,153 _ _ - 1,623,029 _ - 1,608,479 7,759,628 13,099 - 227,684 5,597,303 _ - - 989,081 _ - 175,517 318,737 - 58,966 - 1,875,841 _ - 88,107 3,312,774 _ - 826,717 826,717 13,099 58,966 5,468,733 63,439,031 - 63,281 - 6,047,115 _ - 1,017,236 23,951,223 _ - 855,164 3,168,513 _ - 1,823,206 1,888,631 8,000 - - 7,621,663 _ - 22,090 7,364,651 _ _ - 4,221,956 8,943 - - 68,236 _ - 210,996 9,409,692 _ - 1,043,753 13,742,919 16,943 63,281 4,972,445 77,484,599 (3,844) (4,315) 496,288 (14,045,568) _ _ - 26,232 _ - (26,232) (26,232) _ - (26,232) - (3,844) (4,315) 470,056 (14,045,568) 379,623 (1,837,021) 5,074,377 108,898,008 $ 375,779 $ (1,841,336) $ 5,544,433 $ 94,852,440 13 ~~/ ~ laa City of Dublin Reconciliation of the Governmental Funds Statement of Revenues, Expenditures and Changes in Fund Balances to the Government-Wide Statement of Activities and Changes in Net Assets For the year ended June 30, 2009 Net Change in Fund Balance -Total Governmental Funds Amounts reported for governmental activities in the Statement of Activities differs from the amounts reported in the Statement of Revenues, Expenditures, and Changes in Fund Balances because: Governmental funds report acquisition of capital assets as expenditures in various functions and in capital outlay. However, in the Government-Wide Statement of Activities and Changes in Net Assets, the cost of those assets is allocated over their estimated useful lives as depreciation expense. This is the amount of capital assets additions recorded in the current period. This amount excludes the internal service funds capital asset additions of $9,369,296. In the Statement of Activities, capital assets donated to the City are reported as general revenue, whereas in the governmental funds, capital assets donated do not increase financial resources. Thus, the change in net assets differs from the change in fund balances by the value of the asset donated of $8,394,764. Changes in long term compensated absences in governmental activities are not reported in governmental funds. Depreciation expense on capital assets is reported in the Government-Wide Statement of Activities and Changes in Net Assets, but it does not require the use of current financial resources. Therefore, depreciation is not reported as an expenditure in governmental funds. This amount excludes the internal service funds depreciation of $2,182,682 Accrual of OPEB obligations does not require the use of current financial resources and therefore is not recorded as expenditures on the governmental fund financial statements Revenues that have not met the revenue recognition criteria in the Fund Financial statements are recognized as revenue in the Government-Wide Financial Statements. This amount represents the change in deferred revenue from prior year. Internal service funds are used by management to charge the costs of certain activities to individual funds. The net (expense) of the internal service funds is reported with governmental activities. Change in Net Assets of Governmental Activities See accompanying Notes to Basic Financial Statements. $ (14,045,568) 6,633,244 p,p: 12,672,719 ~. (47,541) ,. ^r r (14,325,258) (63,319) ~ m¢ (180,331) 1~ ~+ 7,685,855 $ (1,670,199) ^r .A- k^ 5~ ~ l8d City of Dublin Statement of Net Assets Proprietary Funds June 30, 2009 ASSETS Current assets: Cash and investments Prepaid items Accounts receivable Total current assets Non Current assets: OPEB Capital Assets: Land Construction in progress Buildings and improvements Machinery and equipment Less: accumulated depreciation Total capital assets Total assets LIABILITIES Current liabilities: Accounts payable Total current liabilities Noncurrent assets: Advance from other funds Total noncurrent liabilities Total liabilities NET ASSETS Invested in capital assets Unrestricted Total net assets Governmental Activities Internal Service Funds $ 7,493,339 664 3,766 7,497,769 516,515 10,774,792 143,365 62,081,624 5,901,943 (20,720,778) 58,697,461 66,195,230 15,134 15,134 2,945,495 2,945,495 2,960,629 58,697,461 4,537,140 $ 63,234,601 See accompanying Notes to Basic Financial Statements. 15 City of Dublin Statement of Revenues, Expenses, and Changes in Net Assets Proprietary Funds For the year ended June 30, 2009 ~l ~~ 1 ~a : ..' Governmental Activities ~.F Internal Service „~, Funds ~; OPERATING REVENUES: Charges for services $ 1,838,441 Other revenue 383,899 "~'' Total operating revenues 2,222,340 .~ OPERATING EXPENSES: ~„ Supplies and services 490,860 OPEB expenses 511,000 Depreciation 2,184,399 Total operating expenses 3,186,259 Operating income (loss) (963,919) ,~,. NONOPERATING REVENUES: ~' Interest income 255,010 '~"' Total nonoperating revenues 255,010 "` Contribution of capital assets 8,394,764 .. Change in net assets 7,685,855 ~,, NET ASSETS: ~. Beginning of year 55,548,746 ° End of year $ 63,234,601 "' ~.. See accompanying Notes to Basic Financial Statements. ~- , Sa ~ ~~~ City of Dublin Statement of Cash Flows Proprietary Funds For the year ended June 30, 2009 Governmental Activities Internal Service Funds CASH FLOWS FROM OPERATING ACTIVITIES: Receipt from customers $ 1,846,297 Payments to suppliers (1,296,387) Other 383,899 Net cash provided (used) by operating activities 933,809 CASH FLOWS FROM NON CAPITAL FINANCING ACTIVITIES: Payments on advances from other funds (318,578) Net cash provided (used) by capital and related financing activities (318,578) CASH FLOWS FROM CAPITAL AND RELATED FINANCING ACTIVITIES: Acquisition of capital assets (683,004) Net cash provided (used) by capital and related financing activities (683,004) CASH FLOWS FROM INVESTING ACTIVITIES: Interest received 255,010 Net cash provided (used) by investing activities 255,010 Net increase (decrease) in cash and cash equivalents 187,237 CASH AND CASH EQUIVALENTS: Beginning of year 7,306,102 End of year $ 7,493,339 RECONCILIATION OF OPERATING INCOME TO NET CASH PROVIDED (USED) BY OPERATING ACTIVITIES: Operating income (loss) $ (963,919) Adjustments to reconcile operating income (loss) to net cash provided (used) by operating activities: Depreciation 2,184,399 Net effect of changes in: Accounts receivable 7,856 Prepaid items (6~) Accounts payable 11,214 OPEB Obligation (305,097) Net cash provided (used) by operating activities $ 933,809 See accompanying Notes to Basic Financial Statements. 17 s3 ~~ i ~a City of Dublin Statement of Fiduciary Net Assets Fiduciary Fund June 30, 2009 ASSETS Cash and investments Restricted cash and investments Receivable Total assets LIABILITIES Due to trustee Due to bondholders Total liabilities Agency Fund $ 220,893 180,410 281 $ 401,584 $ 25,947 375,637 $ 401,584 See accompanying Notes to Basic Financial Statements. Sy ~ ~~a City of Dublin Index to Notes to Basic Financial Statements For the year ended June 30, 2009 Page 1. Summary of Significant Accounting Policies ....................................................................................................22 2. Cash, Cash Equivalents and Investments ..........................................................................................................31 3. Notes Receivable ....................................................................................................................................................36 4. Interfund Transactions ..........................................................................................................................................38 5. Capital Assets .........................................................................................................................................................40 p ~' ~ g Y) .............................................................................................. 6. S ecial Assessment Ci Debt Non-Obli ator 41 7. Joint Powers Agreements .....................................................................................................................................41 i 8. Fund Equity ............................................................................................................................................................41 9. Risk Management ..................................................................................................................................................43 10. Compensated Absences ........................................................................................................................................44 11. Pension Plan ...........................................................................................................................................................44 12. Post Employment Health Care Plan ...................................................................................................................46 13. Commitment and Contingent Liabilities ...........................................................................................................51. 14. Deficit Fund Balance .............................................................................................................................................54 15. Prior Period Adjustments .....................................................................................................................................54 16. Termination Benefits .............................................................................................................................................54 17. Subsequent Events -State of California Financial Crisis ................................................................................55 This page intentionally left blank. 55«; /~ ... ~~ aj~ ~8a NOTES TO BASIC FINANCIAL STATEMENTS ~. 5~ a6 l~~ City of Dublin Notes to Basic Financial Statements For the year ended June 30, 2009 1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES The basic financial statements of the City of Dublin, California, (City) have been prepared in conformity with generally accepted accounting principles (GAAP) as applied to governmental agencies. The Governmental Accounting Standards Boards (GASB) is the accepted standard setting body for establishing governmental accounting and financial reporting principles. The more significant of the City's accounting policies are described below. A. Reporting Entity The City is a residential community with a significant regional commercial base, located in the Tri- Valley area of Alameda County, California at the crossroads of Interstate Freeways 580 and 680. The City was incorporated as a municipal corporation on February 1, 1982. The population estimated at January 1, 2009 by the California Department of Finance was 47,922 including prisoners housed at the Alameda County Sheriff's Department Santa Rita Jail and at the Federal Correctional Institute. The City operates under the Council-Manager form of government, with five elected Council members ~'` served by a full-time City Manager and staff. At June 30, 2009, the City's staff was comprised of 86 ,„ City's permanent employees who were responsible for City-provided services. The City provides many traditional municipal services through contracts with both public and private agencies. Approximately ~" 127 contract employees whom provided a variety of municipal services from City facilities. At of June ,~. 30, 2009, the City had approximately 194 temporary and seasonal personnel that were on active payroll status. • The basic financial statements of the City include the financial activities of the City as well as the Dublin Information, Inc. (DII). DII is a separate legal entity, which assists in providing financing to the City. '" DII is governed by the same governing board as the City plus the City Manager and Administrative Service Director and is dependent on the City for its cash flows. The financial activity of DII is merged (termed 'blended') with that of the City and is accounted for in a Special Revenue Fund. The ownership ""' of assets previously owned by DII was transferred to the City as of February 1,1999, in conjunction with the early retirement of the 1933 Certificates of Participation. Due to inactivity, the Board of Directors adopted a Resolution to pursue dissolution on October 21, 2008. "" B. Basis of Accounting and Measurement Focus The accounts of the City are organized on the basis of funds, each of which is considered a separate accounting entity. The operations of each fund are accounted for with a separate set of self-balancing accounts that comprise its assets, liabilities, fund equity, revenues, and expenditures, or expenses, as appropriate. Government resources are allocated to and accounted for in individual funds based upon the purposes for which they are to be spent and the means by which spending activities are controlled. Government-Wide Financial Statements ..~ The City's Government Wide Financial Statements include a Statement of Net Assets and a Statement of Activities and Changes in Net Assets. These statements present summaries of Governmental Activities K,.. for the City. Fiduciary activities of the City are not included in these statements. .~ 5g ~ 18~Z City of Dublin Notes to Basic Financial Statements, Continued For the year ended June 30, 2009 1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES, Continued B. Basis of Accounting and Measurement Focus, Continued Government-Wide Financial Statements, Continued These statements are presented on an "economic resources" measurement focus and the accrual basis of accounting. Accordingly, all of the City's assets and liabilities, including capital assets and infrastructure as well as long-term debt, are included in the accompanying Statement of Net Assets. The Statement of Activities presents changes in net assets. Under the accrual basis of accounting, revenues are recognized when earned and expenses are recorded in the period in which the liability is incurred, regardless of the timing of the related cash flows. The Statement of Activities demonstrates the degree to which the direct expenses of a given function are offset by program revenues. Direct expenses are those that are clearly identifiable with a specific function. The types of programs revenues for the City are reported in three categories: 1) charges for services, 2) operating grants and contributions, and 3) capital grants and contributions. Charges for services include revenue from customers or applicants who purchase, use, or directly benefit from goods, services, or privileges provided by a given function. Grants and contributions include revenues restricted to meeting the operational or capital requirements of a particular function. Taxes and other items not properly included among program revenue are reported instead as general revenue. Certain eliminations have been made as prescribed by GASB Statement No. 34 in regards to interfund activities, payables, and receivables. All internal balances in the Statement of Net Assets have been eliminated. Governmental Fund Financial Statements Governmental Fund Financial Statements include a Balance Sheet and a Statement of Revenues, Expenditures, and Changes in Fund Balances for all major governmental funds and aggregated non- major funds. An accompanying schedule is presented to reconcile and explain the differences in net assets as presented in these statements to the net assets presented in the Government-Wide Financial Statements. The City has presented the General Fund, Housing Noise Mitigation Special Revenue Fund, and the Traffic Impact Fee Capital Projects Fund as major funds because they met the qualifications of GASB Statement No. 34. In addition, the City has elected to present the following funds as major because of their significance to the City as a whole: the Public Facilities Fees Capital Project Fund, Public Art Capital Projects Fund, and the Fire Impact Fees Capital Projects Fund. All governmental funds are accounted for on a spending or "current financial resources" measurement focus and the modified accrual basis of accounting. Accordingly, only current assets and current ~` liabilities are generally included on the balance sheets. The reported fund balance is the net current ~, assets, which is considered only to be a measure of available spendable resources. Governmental fund operating statements present a summary of sources and uses of available spendable resources during a '~ period by presenting increases and decreases in net current assets. Under modified accrual basis of accounting, revenues are recognized in the accounting period in which they both become measurable and available to finance expenditures of the current period. Accordingly, revenues are recorded when "~ received in cash, except that revenues subject to accrual (generally 60 days after year-end) are property taxes, sales taxes, transient occupancy taxes, interest revenues, charges for services, and courts fines. ~~ 59 ~ Aga City of Dublin Notes to Basic Financial Statements, Continued For the year ended June 30, 2009 1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES, Continued B. Basis of Accounting and Measurement Focus, Continued Governmental Fund Financial Statements, Continued Licenses, use of property, and permit revenues are not susceptible to accrual because they generally are not measurable until received in cash. Expenditures are generally recognized under the modified accrual basis of accounting when the related fund liability is incurred, except for principal and interest on general long term obligations which are recognized when due. Because of their current financial resources focus, expenditures recognition for governmental fund types excludes amounts represented by non-current liabilities. Since they do not affect net current assets, such long-term amounts are not recognized as governmental fund expenditures ~~ or fund liabilities. 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 City, except those required to be accounted for in another fund. The Housing and Noise Mitigation Special Revenue Fund - is used to account for in-lieu housing fees and noise mitigation impact fees received from developers of properties, which can only be used for the design, development, and construction of citywide affordable housing projects and noise mitigation projects in Eastern Dublin. The Tra ff-ic Impact Fees Capital Projects Fund - is used to account for fees received from developers of properties, which can only be used for the design, development and construction of street projects within the City. 0 The Public Facilities Fees Capital Project Fund - is used to account for impact fees received from developers of properties, which can only be used for the design, development, and construction of ~'"" new public facilities within the City. ,~„ The Public Art Capital Projects Fund - is used to account for fees received from developers of '"~ properties, which can only be used for the purchase, design, development, and construction of w> Public Art projects within the City. .. The Fire Impact Fees Capital Projects Fund - is used to account for fees received from developers of »~. properties, which can only be used for the design, development, and construction of fire capital expansion projects within the City. '" ..~ ~: .F ~a ~ isa City of Dublin Notes to Basic Financial Statements, Continued For the year ended June 30, 2009 1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES, Continued B. Basis of Accounting and Measurement Focus, Continued Proprietary Fund Financial Statements Proprietary Fund Financial Statements include a Statement of Net Assets, a Statement of Revenues, Expenses, and Changes in Net Assets, and a Statement of Cash Flows. All proprietary funds are accounted for using the accrual basis of accounting and the "economic resources" measurement focus. Their revenues are recognized when they are earned, and their expenses are recognized when they are incurred. All liabilities associated with their activity are also included on the Statement of Net Assets. The City's proprietary funds are: Internal Service Funds which are used to account for the financing of goods or services provided by department or agency to other department or agencies of the City on a cost-reimbursement basis. The City uses internal service funds to account for asset replacement and internal charges collected for the purpose of funding post-retirement health care activities. Because the principal users of the internal services are the City's governmental activities, the financial information of the internal services funds are consolidated into the governmental activities column when presented in the government-wide financial statements. To the extent possible, the cost of these services is reported in the appropriate functional activity. Proprietary funds distinguish operating revenues and expenses from nonoperating items. Operating revenues and expenses generally result from providing services in connection with a proprietary fund's principal ongoing operations. The principal operating revenues of the City's proprietary funds are charges to customers for services. Operating expenses include the cost of services, administrative expenses, and depreciation on capital assets. All revenues and expenses not meeting this definition are reported as nonoperating revenues and expenses. Fiduciary Fund Financial Statements Fiduciary Fund Financial Statements include a Statement of Net Assets. The fiduciary funds are used to "x report assets held in a trustee or agency capacity for others and therefore are not available to support City programs. Since these assets are being held for the benefit of a third party, these funds are not incorporated into the government-wide statements. The City's fiduciary fund consists of one agency '~' fund. The Dublin Boulevard Extension Special Assessment District is an agency fund, which uses the accrual '~ basis of accounting to account for amounts held for debt service on the Dublin Boulevard Extension Project. The Agency fund is custodial in nature (assets equal liabilities) and therefore does not involve measurement of results of operations. The City is not responsible for payment of the bonds and acts only as an agent to collect assessments, pay bondholders, and initiate foreclosure proceedings. ~~ (~/~ /g~ City of Dublin Notes to Basic Financial Statements, Continued For the year ended June 30, 2009 1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES, Continued B. Basis of Accounting and Measurement Focus, Continued Fiduciary Fund Financial Statements, Continued The Fallon Village and Schaefer Ranch Geological Hazard Abatement District (GHAD) are expendable trust funds. Each fiscal year, the District Engineer prepares an Engineer's Report which includes the budget for the GHAD for that year. The annual budget consists of regular site monitoring, annual inspections, contract services for annual mitigation and repairs, and administrative costs. The funds collected through special assessment are placed into a dedicated reserve fund. The reserve fund is set aside to be used to mitigate and repair large, geologic hazards, such as landsides in the Fallon Village and the Schaefer Ranch Subdivision. C. Capital Assets Capital assets, which include buildings, machinery and equipment, and infrastructure assets (roads, bridges, curbs and gutters, streets and sidewalks, drainage systems, lighting systems, and park improvements), are reported in the Governmental Activities columns of the Government-Wide Financial Statements. Capital assets are defined by the City as assets with an initial, individual cost of more than $2,500 for general capital assets and $100,000 for infrastructure capital assets. Such assets are recorded at historical cost or estimated historical cost if actual historical cost is not available. Donated capital assets are valued at their estimated fair market value on the date donated. Capital assets are depreciated over their estimated useful lives using the straight-line method. This means the cost of the asset is divided by its expected useful life in years and the result is charged to expense each year until the asset is fully depreciated. The purpose of depreciation is to spread the cost of capital assets over the useful life of these assets. The amount charged to depreciation expense each year represents that year's pro rata share of the cost of capital assets. Depreciation of capital assets is charged as an expense against operations each year and the total amount of depreciation taken over the years, called accumulated depreciation, is reported on the Statement of Net Assets of the government-wide financial statements as a reduction in the book value of the capital assets. The City has assigned the useful lives listed below to capital assets. Building and improvements 20-38 Years Machinery and equipment 3-15 Years Infrastructure Streets 20-75 Years D. Use of Restricted Resources When both restricted and unrestricted resources are available for use, it is the City's policy to use restricted resources first, and then unrestricted resources as needed. ~,~ .. ~< ~ ~b ~~a City of Dublin Notes to Basic Financial Statements, Continued For the year ended June 30, 2009 1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES, Continued E. Cash and Investments GASB Statement No. 31, "Accounting and Financial Reporting for Certain Investments and External Pools", requires governmental entities to report certain investments at fair value in the balance sheet and recognize the corresponding change in the fair value of investments in the year in which the change occurred. In accordance with GASB Statement No. 31, the City has adjusted investments to fair market value. Proprietary fund type cash and investments are used in the preparation of the statement of cash flows as investments are not allocated to specific funds. Each of these funds' allocation of pooled cash and investments is considered cash and cash equivalents. In accordance with GASB Statement No. 40, Deposit and Investment Disclosures (Amendment of GASB No. 3), certain disclosure requirements for Deposits and Investment Risks were made in the following areas: • Interest Rate Risk • Foreign Currency Risk • Credit Risk x ^ Overall ^ Custodial Credit Risk ^ Concentrations of Credit Risk In addition, other disclosures are specified including use of certain methods to present deposits and investments, highly sensitive investments, credit quality at year-end and other disclosures. The City participates in an investment pool managed by the State of California titled Local Agency Investment Fund (LAIF), which has invested a portion of the pool funds in Structured Notes and Asset- Backed Securities. LAIF's investments are subject to credit risk with the full faith and credit of the State of California collateralizing these investments. In addition, these Structured Notes and Asset-Backed Securities are subject to market risk as to change in interest rates. F. Deferred Compensation Plan ~' City employees may defer a portion of their compensation under a City sponsored deferred compensation plan created in accordance with Internal Revenue Code Section 457. Under this plan, participants are not taxed on the deferred portion of their compensation until it is distributed to them; distributions may be made only at termination of employment, retirement, death, or in an emergency as defined by the Plan. In accordance with GASB Statement No. 32, the funds have been placed in a trust administered by ICMA Retirement Corporation and are not available to the City's general creditors. ~` Accordingly, the City does not report the assets in the financial statements. ~~ 'V 6 ..{1 ~~3i.) lV City of Dublin Notes to Basic Financial Statements, Continued For the year ended June 30, 2009 1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES, Continued G. Property Tax Alameda County assesses properties and bills, collects, and distributes property taxes to the City. The County remits the entire amount paid and handles the collection of all delinquencies. The City receives proportionate shares of prior year collections including interest and penalties. Secured and unsecured property taxes are levied on January 1 of the preceding fiscal year. The property tax assessments are formally due on November 1 and February 1, and become delinquent as of December 10 and April 10, respectively. Taxes become a lien on the property effective January 1 of the preceding year. H. Post Employment Health Care Benefits The City provides certain health care benefits for retirees, as required under a contract signed with PERS. All former employees who retire with the City under PERS are eligible for these benefits. GASB 45 requires public agencies to estimate their Other Post Employment Benefits (OPEBs) and ~ account for them future liability. Rather than use the "pay as you go" system and account for retiree e~~ enefits as they are due, GASB 45 requires the agencies to account for the expenses as benefits are accrued for the employees. The City engaged in an Actuarial Study Update with Bartel Associates, LLC ~ and based on the 2007 actuarial result, the use of the CALPERS trust will reduce City contribution towards Retiree Medical in the future. On June 29, 2007 the City established an agreement with the California Public Employees' Retirement System (CALPERS) to set aside funds and deposit into the ~"" California Employer's Retiree Benefit Trust (CERBT) fund to accumulate, and distribute assets for the exclusive benefit of retirees and their beneficiaries. Plan assets are irrevocable and may not be used for any purpose other than funding post retirement health care. The CERBT fund is an agent multiple ~"'' employer plan and in order to ensure that the CERBT fund remains compliant with all reporting ~ requirements, the CALPERS is responsible for publishing aggregate GASB 43 compliance Financial Statements, Notes, and Required Supplementary Information (RSI). The information may be found on ~` CALPERS web site at www.calpers.ca.gov. The City also provides health care benefits for certain former employees who retired from the Dougherty Regional Fire Authority (DRFA). The DRFR is a closed Joint Power Authority. The cost of those retiree health care benefits is recognized as expenditures in the general fund as premiums are "~ paid. The Cost is recognized on the full accrual basis in the government wide statements. The City of ~_ Dublin and the City of San Ramon share the cost, with Dublin paying 57.51 % and San Ramon paying 42.49% of the "pay as you go" cost. '"' I. Net Assets Government-Wide Financial Statements In the Government-Wide Financial Statements, net assets are classified in the following categories: ~, Invested in Capital Assets, Net of Related Debt -This amount consists of capital assets net of accumulated depreciation and reduced by outstanding debt that attributed to the acquisition, construction, or improvement of the assets. '~"' ,. Restricted Net Assets -This amount is restricted by external creditors, grantors, contributors, or laws or regulations of other governments. ~. ~" City of Dublin Notes to Basic Financial Statements, Continued For the year ended June 30, 2009 1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES, Continued I. Net Assets, Continued Gyp Aga Unrestricted Net Assets -This amount is all net assets that do not meet the definition of "invested in capital assets, net of related debt" or "restricted net assets." Fund Financial Statements ~ Governmental fund balances represent the net current assets of each fund. Net current assets generally represent a fund's cash and receivables, less its liabilities. Portions of a fund's balance may be reserved or designated for future expenditures. Reserves are restrictions placed by outside entities, such as other governments, which restrict the expenditures of the reserved funds to the purpose intended by the entity which provided the funds. '~ The City cannot modify or remove these restrictions or reserves. In addition, the City Council may reserve funds by resolution to set aside funds which are not available for current appropriation or expenditure. Designations are imposed by City Council to reflect future spending plans or concerns about the availability of future resources. Designations may be modified, amended or removed by City Council `" action. The City had the following reserves and designations: Reserved,for prepaid expenditures is the portion of fund balance set aside to indicate that these items do not represent available, spendable resources even though they are a component of assets. Reserved for cemetery endowment is the portion of fund balance to be retained. This represents funds transferred by the Dublin Cemetery Association, when the City acquired the cemetery. Reserved for culvert maintenance is the portion of fund balance to be set aside for the improvement and maintenance agreement for the Box Culvert to channel drainage from Dublin Ranch development. In 2008, additional funds were added to address long term maintenance of "~ specialized storm drains installed under an agreement with California Department of Transportation. ~, Reserved for storm water treatment is the portion of fund balance to be set aside for the improvement and maintenance of the storm water treatment units. Reserved for long-term advances is the portion of fund balance set aside to indicate that these items do not represent available, spendable resources even though they are a component of assets. Reserved for rec~cling~rograms is the portion of fund balance set aside for revenue received from the ~, Alameda County Waste Management Authority to be used solely for recycling. Reserved for public safety programs represents the net amounts available from grant and other sources restricted to use on public safety programs. .~, ~a /~~ lea City of Dublin Notes to Basic Financial Statements, Continued For the year ended June 30, 2009 1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES, Continued I. Net Assets, continued Reserved for street maintenance and construction represents amounts available and restricted to use on projects related to street maintenance and construction. Reserved for health and welfare programs includes amounts restricted for use on programs including housing, noise mitigation, and garbage services. Reserved for Public Art includes amounts restricted for use on programs that are funded by Public Art developer impact fees. Reserved for Noise Mitigation includes amounts restricted for use on Noise Mitigation programs that are funded by the Housing and Noise Mitigation developer impact fees. Reserved, for Non Residential Housing In-Lieu includes amounts restricted for use on programs that are funded by the Housing and Noise Mitigation developer impact fees. Reserved for Affordable Housing includes amounts restricted for use on affordable housing programs that are funded by the Housing and Noise Mitigation developer impact fees. Reserved for capital improvement projects represents amounts collected from developers to be spent on specific projects impacted by the development. Designated for economic uncertainty is the portion of fund balance to be used in the event of economic uncertainty. Designated for authorized expenditures represents the amount which although not specifically identified with an individual project, is designated for uses approved by the City Council including ,~. recovery from catastrophic or uninsured losses, etc. ~. All Other Des nations represents the amount of resources set aside to fund or partially fund the various projects. j. Use of Estimates The preparation of financial statements in conformity with generally accepted accounting principles ~.; requires management to make estimates and assumptions. These estimates and assumptions affect the reported amounts of assets and liabilities and the disclosure of contingent assets and liabilities. In '""" addition, estimates affect the reported amount of expenses. Actual results could differ from these estimates and assumptions. l~h ~ iga City of Dublin Notes to Basic Financial Statements, Continued For the year ended June 30, 2009 1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES, Continued K. New Pronouncements In 2009, the City adopted new accounting standards in order to conform to the following Governmental Accounting Standards Board (GASB) Statements: • GASB Statement No. 55, the Hierarchy of Generally Accepted Accounting Principles for State and Local Governments. This Statement will improve financial reporting by contributing to the GASB's effort to codify all generally accepted accounting principal (GAAP) for State and Local Governments so that they derive from a single source. It is '" intended to make it easier for preparers of state and local government financial statements ~, to identify and apply the "GAAP hierarchy," which consists of sources of accounting principles used in the preparation of financial statements so that they are presented in conformity with GAAP and the framework for selecting those principles. • GASB Statement No. 56, Codification of Accounting and Financial Reporting Guidance Contained in the AICPA Statements on Auditing Standards. This Statement brings existing •, guidance (to the extent appropriate in a governmental environment) without substantive changes into the GASB's body of standards. Statement 56 is part of the GASB's effort to codify all generally accepted accounting principles for state and local governments so that ;~ they derive from a single source. This is intended to make it easier for preparers of state and local government financial statements to identify and apply relevant accounting guidance. 2. CASH, CASH EQUIVALENTS AND INVESTMENTS The City maintains a cash and investment pool, which includes cash balances and authorized investments of all funds, which the City Treasurer invests to enhance interest earnings. The pooled interest earned is allocated to the funds based on average monthly cash and investment balances in these funds. A. Cash Deposits At June 30, 2009, the carrying amount of the City's cash deposits was $4,244,766. Deposits in transit were $43,388. The total outstanding checks were $1,101,366. Bank balances before reconciling items were $5,306,193 at that date, the total amount of which was insured or collateralized with securities held by the pledging financial institutions in the City's name as discussed below. T'he California Government Code requires California banks and savings and loan associations to secure the City's cash deposits by pledging securities as collateral. This Code states that collateral pledged in this ~, manner shall have the effect of perfecting a security interest in such collateral superior to those of a general creditor. Thus, collateral for cash deposits is considered to be held in the City's name. ~, The market value of pledged securities must equal at least 110% of the City's cash deposits. California law also allows institutions to secure City deposits by pledging first trust deed mortgage notes having a value of 150% of the City's total cash deposits. The City may waive collateral requirements for cash deposits, ~, which are fully insured up to $100,000 per depositor by the Federal Deposit Insurance Corporation. The City, however, has not waived the collateralization requirements. ~ 31 ~~ ~ ~~a City of Dublin Notes to Basic Financial Statements, Continued For the year ended June 30, 2009 2. CASH, CASH EQUIVALENTS AND INVESTMENTS, Continued A. Cash Deposits, Continued The City follows the practice of pooling cash and investments of all funds, except for funds required to be held by fiscal agents under the provisions of bond indentures. Interest income earned on pooled cash and investments is allocated on an accounting period basis to the various funds based on the period-end cash and investment balances. Interest income from cash and investments with fiscal agents is credited directly to the related fund. B. Investments Under the provisions of the City's investment policy, and in accordance with Section 53601 of the California Government Code, the City is authorized to investor deposit in the following investments: • United States Treasury Issues • Federal Agency Obligations • Bankers' Acceptances • Commercial Paper. • Time Certificates of Deposit • Money Market Funds • State of California Local Agency Investment Fund (LAIF) • California Asset Management Program (CAMP) ~f In accordance with GASB Statement No. 31, Accounting and Financial Reporting for Certain Investments and for External Investments Pools, investments should be stated at fair value. The City reported its investments at '" fair value. For the year ended June 30, 2009, the unrealized gain on investments amounted to $2,334,061. ~- Interest and investment earnings before recognition of unrealized gain were $3,263,242 as of June 30, 2009. C. Summary of Cash and Investments The following is a summary of pooled cash and investments, including restricted cash and investments at June 30, 2009: Government-Wide Statement of Fiduciary Net Assets Funds Cash and investments Restricted cash and investments Total Statement of Governmental Activities $ 110,266,575 $ 146,200 $ 110,412,775 $ Net Assets Total 220,893 $ 110,487,468 180,410 326,610 401,303 $ 110,814,078 .~ ,. ..~ ~8~ i8a City of Dublin Notes to Basic Financial Statements, Continued For the year ended June 30, 2009 2. CASH, CASH EQUIVALENTS AND INVESTMENTS, Continued D. Risks Disclosures Interest Rate Risk. Interest rate risk is the risk that changes in market interest rates will adversely affect the fair value of an investment. Generally, the longer the maturity of an investment, the greater the ~' sensitivity of its fair value to changes in market interest rates. As a means of limiting its exposure to fair value losses arising from rising interest rates, the City's investment policy provides that final maturities of securities cannot exceed five years. Specific maturities of investments depend on liquidity needs. At ~' June 30, 2009, the City's pooled cash and investments had the following maturities: Maturity Less than one year One to three years Three to five years Percentage of Investment 47% 35% 18% The average maturity of the total portfolio was 1.57 years and the average life of the federal security portfolio was 2.25 years. Deposits and investments held by the City at June 30, 2009 are summarized below: Investment Maturities (in years) m Investment Type City Treasury Deposits: Cash on hand Deposits with banks Total deposits w Investments: Federal Farm Credit Bank Federal Home Loan Bank "" Federal Home Loan Mortgage Corporation Federal National Mortgage Association Money Market/Mutual Funds California Asset Management Program Fund California Local Agency Investment Fund Total Investments ;.~ Total City Treasury Cash with fiscal agents Total City and fiscal agents cash and investments Fair Market Value 1 year or less 1-5 years $ 3,538 $ 3,538 $ - 4,244,766 4,244,766 - 4,248,304 4,248,304 - 13,039,383 2,034,698 11,004,685 37,802,028 6,053,028 31,749,000 9,421,927 3,074,141 6,347,786 14,796,734 6,673,756 8,122,978 35 35 - 55,650 55,650 - 31,123,407 31,123,407 - 106,239,164 49,014,715 57,224,449 110,487,468 53,263,019 57,224,449 326,610 - 326,610 $ 110,814,078 $ 53,263,019 $ 57,551,059 R~ 6va6 i~a City of Dublin Notes to Basic Financial Statements, Continued For the year ended June 30, 2009 2. CASH, CASH EQUIVALENTS AND INVESTMENTS, Continued D. Risks Disclosures, Continued Credit Risk. Credit risk is the risk that an issuer of an investment will not fulfill its obligation to the holder of the investment. At June 30, 2009, the City had the following investments credit risk ratings: The Credit Risk Ratings listed below meet or exceed the acceptable credit risk ratings established in the City's investment policy and required, where applicable, by the California Government Code. Within the investments permitted by the Government Code, the City's investment policy seeks to further restrict eligible investment to the investments listed below. In the event an apparent discrepancy is found between the City's policy and the Government Code, the more restrictive parameters will take precedence. An appropriate risk level is maintained by primarily purchasing securities that are of high quality, liquid, and marketable. The portfolio is diversified by security type and institution to avoid incurring unreasonable and avoidable risks regarding specific security types or individual financial institutions. Credit Quality Ratings Moody's S&P Investments: Federal Home Loan Bank AAA AAA Federal Home Loan Mortgage Corporation AAA AAA Federal National Mortgage Association AAA AAA Federal Farm Credit Bureau AAA AAA Mutual Funds AAA AAA California Asset Management Program Fund Not Rated AAA California Local Agency Investment Fund Not Rated Not Rated Cash with fiscal agents Not Rated Not Rated Concentration of Credit Risk. The primary objectives, in order of priority, of the City's investment activities is be based on: 1) Safety; 2) Liquidity; 3) Yield; 4) Diversification. The table below identifies the investment types that are authorized by the City's investment policy or stipulated by the California Government Code. Authorized Investment Type Maximum Maturity Maximum Percentage of Portfolio Maximum Investment in One Issuer United States Treasury None None None Federal Agency Obligations None None 40%* Bankers Acceptances 180 days 40% 20% Commercial Paper 270 days 25% 10%** Negotiable Certificates of Deposit None 30% 20% Time Certificates of Deposit 365 days 10% CA only Money Market Mutual Funds None 20% None State of CA Local Agency Investment Fund (LAIF) None 75% None California Asset Management Program (CAMP) None None None .~ «~ 7~ e7" ~d~ City of Dublin Notes to Basic Financial Statements, Continued For the year ended June 30, 2009 m~ 2. CASH, CASH EQUIVALENTS AND INVESTMENTS, Continued D. Risks Disclosures, Continued *There is no limitation as to the percentage of the portfolio that may be invested in this category. However, the Treasurer should strive to limit the portfolio's exposure to any one federal agency issuer to 40% of the total portfolio and limit the portfolio's exposure to callable securities to 25% of the overall portfolio. **The amount invested in commercial paper of any one issuer in combination with any other debt from that issuer shall not exceed 20 percent of the portfolio. Custodial Credit Risk. For an investment, custodial credit risk is the risk that, in the event of the failure of the counterparty, the City will not be able to recover the value of its investments or collateral securities that are in the possession of an outside party. Of the City's investments, $326,610 of securities is held by the fiscal agents not in the name of the City. As of June, 2009 there were $180,410 on deposit at US Bank for the Dublin Boulevard Extension Special Assessment District and $146,200 on deposit with State Condemnation Fund. E. Investments in Local Agency Investment Fund The Local Agency Investment Fund (LAIF) is a voluntary investment program created by statute. It began in 1977 as an investment alternative for California's local governments and special districts and continues today under the State Treasurer administration. The LAIF is part of the Pooled Money Investment Account (PMIA). The PMIA began in 1955 and oversight is provided by the Pooled Investment Board (PMIB) and an in-house Investment Committee. The PMIB members are the State Treasurer, Director of Finance, and State Controller. The Local Investment Advisory Board (LIAB) provides oversight for LAIF. The Board consists of five members as designated by statute. The Chairman is the State Treasurer or his designated representative. Two members qualified by training and experience in the field of investment of finance, and the State Treasurer appoints two members who are treasurers, finance or fiscal officers or business managers employed by any county, city or local district, or municipal corporation of the State of California. The term of each appointment is two years or at the pleasure of the appointing authority. The City valued its investments in LAIF as of June 30, 2009, at amortized cost which approximates the fair value. If the fair value was to be calculated it would be calculated by multiplying the account ~. balance with LAIF times a fair value factor of 100.1364%, which is determined by LAIF. This fair value ~ factor was determined by dividing all LAIF participants' total aggregate amortized cost by total aggregate fair value. 35 71~i8a . City of Dublin Notes to Basic Financial Statements, Continued For the year ended June 30, 2009 .. 2. CASH, CASH EQUIVALENTS AND INVESTMENTS, Continued E. Investments in Local Agency Investment Fund, Continued The City's investments with Local Agency Investment Funds (LAIF) at June 30, 2009, included a portion of the pooled funds invested in Structured Notes and Asset-Backed Securities. These investments included the following: • Structured Notes are debt securities (other than asset-backed securities) whose cash flow characteristics (coupon rate, redemption amount, or stated maturity) depend upon one or more indices and/ or that have embedded forwards or options. Typical Structured Notes are issued ~, by most corporations and government sponsored, for example, the Federal National Mortgage Association and the Federal Home Loan Bank. `~` • Asset-Backed Securities, the bulls of which are mortgage-backed securities, entitle their purchasers to receive a share of the cash flows from a pool of assets such as principal and interest repayments from a pool of mortgages, small business loans, or credit card receivables. As of June 30, 2009, the City had a balance of $31,123,407 of market value invested in LAIF, which had invested 14.71% of the pooled investment funds ($50,743,268,381) in Structured Notes ($5,169,332,000) and „~, in Asset Backed Securities ($2,296,565,000). The fair value of the City's position in the pool is materially equivalent to the value of the pool share. 3. NOTES RECEIVABLE The following table summarizes the notes receivable outstanding as of June 30, 2009: First Time Homebuyer Loan Eden Senior Affordable Housing Loan Fairway Ranch Loan Arroyo Vista Predevelopment Loan Total $ 943,068 2,522,432 750,000 324,936 $ 4,540,436 Revolving Home Loans - As part of the City of Dublin First Time Homebuyer Loan Program (FTHLP), the City provides financial assistance, in the form of a deferred loan, for first time homebuyers within a certain "~ income range to buy their first home in Dublin. Monthly payments of principal and interest are generally ,.R deferred until the homes are sold, in default, and in Market Rate homes, when the home owners refinance their primary mortgage. The total outstanding amount due to the City including accrued simple interest at 3.5% per annum as of June 30, 2009 was $943,068. .•~ .. 2ti ~a ba /~a City of Dublin Notes to Basic Financial Statements, Continued For the year ended June 30, 2009 3. NOTES RECEIVABLE, Continued Revolving Home Loans, Continued ORIGINAL m LOAN ACCRUED LOAN ,~ LOAN # LOAN DATE AMOUNT INTEREST BALANCE #07-01 02/16/07 $ 39,915 $ 3,311 $ 43,226 ,~ #07-03 03/30/07 60,039 4,738 64,777 .~ #07-02 04/03/07 36,500 2,867 39,367 #07-08 07/24/07 35,596 2,413 38,009 "" #07-10 08/28/07 49,536 3,192 52,728 #07-09 08/28/07 26,036 1,678 27,714 #07-06 09/28/07 35,640 2,191 37,831 ~" #07-07 09/28/07 42,886 2,636 45,522 ,~ #07-12 02/16/07 33,051 2,741 35,792 #07-14 10/01/07 19,610 1,200 20,810 s #107-11 10/10/07 38,141 2,300 40,441 #07-13 10/11/07 40,253 2,424 42,677 #07-04 10/30/07 50,000 2,920 52,920 #07-15 12/03/07 24,536 1,353 25,889 #07-16 12/28/07 8,000 422 8,422 #07-17 02/01/08 22,826 1,121 23,947 #07-18 02/29/08 24,170 1,129 25,299 #07-20 05/30/ 08 19,175 728 19,903 #08-01 08/15/08 25,377 776 26,153 #08-02 10/20/08 47,200 1,145 48,345 #OS-03 10/17/08 33,750 828 34,578 #08-04 11/14/08 41,500 907 42,407 #08-05 01/29/09 22,619 330 22,949 #08-06 02/11/09 55,404 738 56,142 #08-07 04/09/09 27,425 216 27,641 #08-08 06/30/09 39,576 4 39,580 TOTAL $ 898,761 $ 44,307 $ 943,068 ~. Eden Senior Af{ordable Housing Loan - On September 23, 2002 the City selected Eden Housing, Inc. as the developer for the affordable senior housing at the site of the former library located at 7606 Amador Valley Blvd This site also houses a senior center that the City constructed during fiscal year 2003-2004. On February 1, 2004, The City entered into an agreement and provided a loan in the amount of $2,248,248 to the '~ Dublin Senior Limited Partnership to support the senior housing project. The interest on the outstanding principal balance of the loan is accrued at the rate of 3% simple interest per annum. The entire outstanding principal balance of the loan, together with the interest accrued shall be payable in full on February 8, 2059, "~' the 55~ anniversary of the Initial Disbursement Date February, l8 2004. Repayments commenced on June 1, A 2006, and on the first day of each June, 60% of the Surplus Cash generated by the project during the previous calendar year are remitted to reduce the outstanding indebtedness. Any payment not paid when '~ due shall bear interest at a rate equal to 10% annum from the due date until it is paid in full. The outstanding amount as of June 30, 2009 was $2,522,432. 37 ~3 ~ 18a City of Dublin Notes to Basic Financial Statements, Continued For the year ended June 30, 2009 3. NOTES RECEIVABLE, Continued .s. Fairway Ranch Loan - On December 1, 2003, the City entered into a loan agreement with the Dublin Ranch Senior Apartment LLP to support the Senior Housing and Multi Family Affordable Housing project at the "'' Fairway Ranch development. The original amount of the loan was $4,500,000. The interest on the w, outstanding principal balance of the loan is accrued at the rate of 3% simple interest per annum. Principal and interest payments are due on October 12, 2008, October 12, 2009, October 12, 2010, the 48th, 60th, and ~` 72nd month, respectively following the initial loan disbursement date of October 12, 2004. The City received ,~, in September 2008 an early payment of $750,000. The outstanding amount as of June 30, 2009 was $750,000. Arroyo Vista predevelopment Loan - On December 18, 2007, the City approved a loan in the amount of ,,, $325,000 to Eden Housing for predevelopment activities on the Arroyo Vista Redevelopment project. Total amount disbursed as of June 30, 2009 was $324,936. The loan was approved to pay for Environmental "~ Review Costs, the Transaction Costs, and other predevelopment costs incurred by Eden Housing, such as ,,,, architect, legal, and consultant fees. The loan shall be paid in full on the third anniversary date of the loan origination date and interest is not accrued on any portion of the loan provided that Eden Housing is not in "`` default under the terms of the loan agreement. ,,, 4. INTERFUND TRANSACTIONS Due To/From During the normal course of business the General Fund may advance to other funds to cover deficit cash balances caused by expenditures for reimbursement type grants. During the fiscal year advances were made to the Supplemental Law Enforcement Services Fund ($41,346) the Transportation Enhancement Activities Fund ($41,491), the Garbage Service Fund ($9,622), the East bay Regional Park District Fund ($33,800) and the Community Development Block Grant Fund ($3,956). When the reimbursement is received, normally shortly after year end, the interfund liability is liquidated. The following interfund balances existed at June 30, 2008: Due from Other Funds Major Fund Due to Other Funds General Fund Non Major Funds $ 130,215 Advances To/From .~ During the 2004-2005 and 2005-2006 Fiscal Years, the General Fund advanced funds to the Fire Impact Fees Capital Projects fund to aid in the financing of fire station construction projects. The advance will be repaid through future revenues to the Fire Impact Fees Fund. Interest accrues on the advance at a rate equal to the `~` City's return on its investment portfolio. .~ ~Q ~9 ~, /E~ City of Dublin Notes to Basic Financial Statements, Continued For the year ended June 30, 2009 4. INTERFUND TRANSACTIONS, Continued Advances To/From, Continued During the fiscal year 2007-2008 Fiscal Year, the General Fund made a long term advance to the Internal Service Fund -CALPERS Side Fund to prepay CALPERS for the City's Side Fund Obligation. The Side Fund was created in 2005 when CALPERS assigned agencies with less than 100 participants to a risk sharing pools. The Side Fund was the City's negative unfunded liability at the time the City assigned to the pool. As part of CALPERS Employer Contribution Rate, the City was scheduled to pay 4.319% of payroll for the next 17 years to eliminate the current side fund obligation. The benefit of prepayment resulted in reduction of the Employer Contribution rate from 15.894% to 11.575%. The advance from General Fund will be repaid annually, calculated at the rate of 4.319% of the total salary and be recorded as an Internal Service Fund retirement benefit expenditure with an offset to reduce the General Fund long term advance. The following inter fund balances existed at June 30, 2009: Advances to Other Funds Major Fund Advances from Other Funds General Fund Fire Impact Fees Special Revenue Fund $ 1,841,336 Internal Service Fund 2,945,495 Total $ 4,786,831 Transfers In/Out Interfund transfers for the year ended June 30, 2009 were as follows: Transfers in: Transfers out: Non Maj or Funds Total Major Funds Housing and Noise General Fund Mitigation Fund $ 19,632 $ 6,600 Total $ 26,232 19,632 $ 6,600 $ 26,232 Transfers In to the General Fund consists of reimbursement in the amount of $19,632 from the Vehicle Abatement Fund for Vehicle Abatement services Transfer In to the Housing and Noise Mitigation Fund in the amount of $6,600 was a reimbursement from the CDBG fund for administrative costs. 39 ~5 ~~ l ~a City of Dublin Notes to Sasic Financial Statements, Continued For the year ended June 30, 2009 5. CAPITAL ASSETS A. Government-Wide Financial Statements Capital assets include land, buildings, and equipment used in City operations. Infrastructure includes roads, bridges, curbs, sidewalks, drainage systems, street and traffic lights, park improvements and other improvements used by all citizens. The following is a summary of capital assets for governmental activities: Balance Balance July 1, 2008 Additions Deletions June 30, 2009 Capital assets, not being depreciated: Land $ 158,623,469 $ 3,932,755 $ - $ 162,556,224 Streets right of way 29,778,062 5,647,226 - 35,425,288 Construction in progress 21,522,458 5,617,640 (19,138,225) 8,001,873 Total capital assets, not being depreciated 209,923,989 15,197,621 (19,138,225) 205,983,385 Capital assets, being depreciated: Infrastructure 324,436,764 20,712,375 - 345,149,139 Buildings and improvements 57,254,299 11,263,400 - 68,517,699 Vehicles and equipment 6,489,500 329,212 (205,627) 6,613,085 Total capital assets, being depreciated 388,180,563 32,304,987 (205,627) 420,279,923 Less Accumulated depreciation for Infrastructure (165,550,995) (14,028,583) - (179,579,578) Buildings and improvements (16,253,350) (1,994,764) - (18,248,114) Vehicles and equipment (4,682,266) (484,593) 205,627 (4,961,232) Total accumulated depreciation (186,486,611) (16,507,940) 205,627 (202,788,924) Total capital assets being depreciated, net 201,693,952 15,797,047 - 217,490,999 Governmental activities capital assets, net $ 411,617,941 $ 30,994,668 $ (19,138,225) $ 423,474,384 Depreciation expense was charged to functions/programs of the primary government as follows: General government $ 830,291 Public Safety 279,143 Highways and streets 13,177,609 Culture and leisure 2,220,897 Total depreciation expense -governmental activities $ 16,507,940 B. Fund Financial Statements The fund governmental financial statements do not present general government capital assets but are shown in the Reconciliation of the Governmental Funds Balance Sheet to the Government-Wide Statement of Net Assets. ~, ~. .~ .. MA ~~ ~ i~ City of Dublin Notes to Basic Financial Statements, Continued For the year ended June 30, 2009 6. SPECIAL ASSESSMENT CITY DEBT (NON-OBLIGATORY) The Dublin Boulevard Extension Special Assessment District, formed within City limits, had outstanding debt with a balance of $748,000 at June 30, 2009. Proceeds of the debt, which was issued in 1991, were used to finance improvements within City boundaries. The City has no legal, contingent or moral obligation for the repayment of this debt and acts solely as the collecting and paying agent for the District. Activities of the District are reported in the Dublin Boulevard Extension Assessment District Agency Fund. 7. JOINT POWERS AGREEMENTS The City participates in joint ventures with other municipal entities through Joint Powers Agreements (JPAs) established under the Joint Exercise of Powers Act of the State of California. Joint Ventures The Cities of Dublin, Pleasanton, and Livermore and the County of Alameda have entered a joint powers agreement, dated September 15, 1992, under which Alameda County constructed an animal shelter facility on County's property. Certificates of Participation were issued to construct the facility. Under the agreement the entities will share in the debt service costs of the project based upon their use of the animal shelter. The original total principal portion of the scheduled debt is $4,523,877. The City's share for the 2008-2009 fiscal year debt service requirements was $59,179, based upon the statistics of live animals handled in the shelter in calendar year 2006 representing 18.73%of the total annual debt service payment. In addition, $275,412 was paid for the City's share of operating shelter services and field services expenses. The City has not recorded an equity interest for the animal shelter agreement. As noted above the ongoing financial interest is limited to the statistics of live animals handled in the appropriate fiscal year. No Joint Powers Authority was established as part of this agreement therefore, separate financial statements are not issued. 8. FUND EQUITY In the Fund Financial Statements, reserves and designations segregate portions of fund balance that are either not available or have been earmarked for specific purposes. The various reserves and designations are established by actions of the City Council and Management and can be increased, reduced or eliminated '~ by similar actions. 41 ~~ a~ /8~ City of Dublin Notes to Basic Financial Statements, Continued For the year ended June 30, 2009 8. FUND EQUITY, Continued In Governmental Funds, fund reservations and designations are presented as a component of fund balance as follows: Housing and Traffic Public Public Art Fire General Noise Impact Facilities Impact Impact Non-Major Fund Mitigation Fees Fees Fees Fees Funds Total Reserved: Prepaid expenditures Cemetery Endowment Stomr Water Treatment Culvert Maintenance Long-term advances-Fse Impact Fee Fund Long-termadvances-PERS Side Fund ~Y~B Programs Public safety Programs Street maintenance andconstniction Health and welfare programs Pub&c Art Noise Mitigation Non Residential Housing In Lieu Affordable Housing Capital improvement projects Total mserved Unreserved, designated: Economic Stability Downtown open space CQ' payovers Operation carryovers Affordable Housing Emerald Glen Acquatic Center Civic Center Expatuion Facility Fallon Park Fee Advance Historic Park Development Maintenance Facility Improvements Emergency Comm,n;cation System Fire Retiree Health Benefits Accrued Leave Payable Investment Market Value Adjustment Designated for authorized expenditures Total unreserved designated Unreserved, undesignated Total fundequity $ 57,531 $ - $ - $ - $ - $ - $ - $ 57,531 60,000 - - - - - - 60,000 103,520 - - - - - - 103,520 336,728 - - - - - - 335,728 1,841,336 - - - - - - 1,841,336 2,945,495 - - - - - - 2,9~L5,495 _ _ _ - - - 283,926 283,926 _ _ _ - - - 381,644 381,644 _ _ - - - - 3,856,928 3,856,928 _ _ _ _ _ _ 577,149 577,149 - - - - 375,779 - - 375,779 - 58,762 - - - - - 58,762 - 123,121 - - - - - 123,121 - lo,ln,loo - - - - - lo,ln,loo - 2609,065 11,892,036 3,796,172 - - 444,786 18,742,009 5,343,610 12,962,048 11,892,036 3,796,172 375,779 - 5,544,433 39,914,028 5,868,847 - - - - - - 5,568,847 1,378,235 - - - - - - 1,378,235 1,306,371 - - - - - - 1,306,322 301,874 - - - - - - 301,874 1,000,000 - - - - - - 1,000,000 1,000,000 - - - - - - 1,000,000 1,176,405 - - - - - - 1,176,405 4,2n,930 - - - - - - 4,Zn,`Y30 2,ns,65s - - - - - - 2ns,658 750,625 - - - - - - 750,625 no,ooo - - - - - - no,ooo 750,000 - - - - - - ~~~ 791,582 - - - - - - ~~~ 2,334,061 - - - - - - 2,334,061 33,474,209 - - - - - - 33,474,209 56,779,748 - - - - - - 56,779,748 _ _ - - - (1,841,336) - (1,841,336) $ 62123,358 $ 12,962048 $ 11,892,036 $ 3,796,122 $ 375,779 $ (1,841,336) $ 5,544,433 $ 94,852,440 .~ ~., 78" d6 ~a City of Dublin Notes to Basic Financial Statements, Continued For the year ended June 30, 2009 9. RISK MANAGEMENT A. Risk Pool The City participates in the ABAG PLAN Corporation, which covers general liability claims in an amount up to $10,000,000 and property insurance coverage for members up to $500,000,000. The City has a deductible or uninsured liability for general liability of up to $50,000 per claim. The deductible for property claims is $5,000 per occurrence, excluding auto claims, which have a $100,000 deductible. Once the City's deductible is met ABAG PLAN becomes responsible for payment of all claims up to the limit. During the fiscal year ended June 30, 2009, the City contributed $201,921 toward current year Property Premium, Public Official Bond, Administrative Premium, and General Liability coverage. The ABAG PLAN is governed by a board consisting of representatives from member municipalities. The board controls the operations of the ABAG PLAN including selection of management and approval of operating budgets, independent of any influence by member municipalities beyond their representation on the Board. The City's contributions to the ABAG PLAN for liability coverage are based on a formula which considers the ratio of the City's payroll to the total payrolls of all entities participating in the same layer of each program, in each program year's loss history and population. Actual surpluses or losses are shared according to a formula developed from overall loss costs and spread to member entities on a percentage basis after a retrospective rating. There have been no significant reductions in any of the City's areas of insurance coverage and no settlement amounts have exceeded coverage in the past three years. Audited financial information for the ABAG PLAN can be obtained from ABAG PLAN, P.O. Box 2050, Oakland, California 94604-2050. B. Workers Compensation Coverage The City participates in the Cities Group, created by a joint powers agreement to provide workers compensation coverage paid from the pooled contributions of its membership with no deductible to the City. Any claim in excess of $1 million is covered up to $10 million through a policy with New York Marine Insurance Corp purchased by the Cities Group. The Cities Group acts as an administrator, claim adjuster and provides other risk management services as provided by State law. Each member of the Cities Group pays a premium commensurate with the level of coverage requested and shares surpluses and deficits proportionately to its participation in the Cities Group. During the year ended June 30, 2009, the City paid the Group $28,610 in premiums. At June 30, 2009, the City of Dublin's share of equity in the Cities group amounted to $186,927. Financial Statements may be obtained from the Cities Group, PO Box 111, Burlingame, CA 94011-0111. C. Liability for Uninsured Claims The GASB requires municipalities to record their liability for uninsured claims and reflect the current ~ portion of this liability as expenditures in their financial statements. As discussed above, the City has coverage for such claims, but it has retained the risk for the deductible or the uninsured portion of these claims in the ABAG PLAN and the Cities Group plans. GASB Statement No. 10, "Financial Reporting for Risk Financing and Related Insurance Issues' require that this amount be separately identified and recorded as a liability. 43 79 ~ lea . City of Dublin Notes to Basic Financial Statements, Continued For the year ended June 30, 2009 9. RISK MANAGEMENT, Continued C. Liability for Uninsured Claims, Continued The City's liability for uninsured claims, limited to general liability and workers compensation claims as discussed above, includes a provision for incurred but not reported (IBNR) losses. This amount was estimated based on claims experience. The liability recorded is adequate to cover 5.43 IBNR claims. Therefore no adjustment was made in fiscal year 2008-2009 as the City's exposure is for the $50,000 deductible per General Liability claim. June 30, 2009 June 30, 2008 June 30, 2007 Balance $ 271,916 $ 271,916 $ 252,547 10. COMPENSATED ABSENCES The City records a long term compensated absences liability to recognize the financial effect of unused general leave and other accrued compensated leave. The total of vacation and other compensated leave is $791,582. The liability will be paid from future resources primarily from the general fund. Accrued General Leave Accrued Compensated Leave 11. PENSION PLAN A. PERS July 1, 2008 _ $ 716,055 $ 27,986 Ar~r~ifinnc ibi,5u~ 19,758 $ 744,041 $ 181,266 Deletions June 30, 2009 $ (118,650) $ 758,913 (15,075) 32,669 $ (133,725) $ 791,582 .~ ~. s Due within One Year $ 227,674 9,801 $ 237,475 ~ Plan Description -The City's defined benefit pension plan, (Miscellaneous Plan), provides retirement and disability benefits, annual cost-of-living adjustments, and death benefits to plan members and beneficiaries. The Miscellaneous Plan is part of the Public Agency portion of the California Public Employees Retirement System (Ca1PERS), a cost sharing multiple-employer plan administered by Ca1PERS, which acts as a common investment and administrative agent for participating public employers within the State of California. A menu of benefit provisions as well as other requirements is established by State statutes within the Public Employees' Retirement Law. The City selects optional benefit provisions from the benefit menu by contract with CaIPERS and adopts those benefits through local ordinance or resolution. Ca1PERS issues a separate comprehensive annual financial report. Copies of the CaIPERS's annual financial report may be obtained from the Ca1PERS Executive Office, 400 P Street Sacramento, California 95814. .. ~;,. k.. City of Dublin Notes to Basic Financial Statements, Continued For the year ended June 30, 2009 11. PENSION PLAN, Continued A. PERS, Continued ~ b6 iga Funding Policy -Active plan members in the Miscellaneous Plan are required to contribute 8 percent of their annual covered salary, 7 percent of which the City pays on behalf of the employees in the amount of $566,982. The City is required to contribute the actuarially determined remaining amounts necessary to fund the benefits for its members. The actuarial methods and assumptions used are those adopted by the Cal PERS Board of Administration. The required employer contribution rate for fiscal year 2008- ., 2009 was 11.811 % for miscellaneous employees. (The City has only miscellaneous employees.) The contribution requirements of the plan members are established by State statute and the employer contribution rate is established and may be amended by Ca1PERS. Annual Pension Cost -For fiscal year 2008-2009, the City's annual pension cost was $1,808,535 and was equal to the City's required and actual contributions. The required contribution for fiscal year 2008- 2009 was determined as part of the June 30, 2007, actuarial valuation using the entry age normal actuarial cost method with the contributions determined as a percent of pay. The actuarial assumptions included (a) 7.75 percent investment rate of return compounded annually net of administrative expenses; (b) projected salary increases that vary by duration of service ranging from 3.25 percent to 14.45 percent for miscellaneous members, depending on Age, Service, and type of employment; (c) Inflation component of 3.0 percent; d) Payroll Growth of 3.25 percent; and e) Individual Salary Growth based on a merit scale varying by duration of employment coupled with an assumed annual inflation growth of 3 percent and annual production growth of 0.25 percent. The actuarial value of Miscellaneous Plari s assets was determined using a technique that smoothes the effect of short-term volatility in the market value of investments over a two to five year period depending on the size of investment gains and/ or losses. Miscellaneous Plan s unfunded actuarial accrued liability (or excess assets) is being amortized as a level percentage of projected payroll on a closed basis. The average remaining amortization period at June 30, 2004 was 14 years for miscellaneous employees for prior and current service unfunded liabilities. The Asset Valuation Method was 15 Year Smoothed Market. Three Year Trend Information for the Miscellaneous Plan Annual Percentage `M Pension Cost of APC Net Pension Fiscal Year (APC) Contributed Obligation 6/30/2007 $ 1,673,674 100% $ - '"~ 6/ 30/ 2008 1,724,812 100 % - r 6/ 30/ 2009 1,808,535 100 % - `~ The City adopted GASB Statement No. 50, Pension Disclosure, an amendment of GASB Statement No. 25 and 27. This Statement aligns the financial reporting for pensions with those for other postemployment benefits. It also provides enhancement in the information disclosed in the notes to the financial statements or presented as required supplementary information. 45 8/ ~ ~g~ City of Dublin Notes to Basic Financial Statements, Continued For the year ended June 30, 2009 11. PENSION PLAN, Continued B. Social Security/Public Agency Retirement Systems (PARS) The Omnibus Budget Reconciliation Act of 1990 COBRA) mandates that public sector employees who are not members of their employer's existing retirement system as of January 1, 1992, be covered by ,~ either Social Security or an alternate plan. The City's part-time, seasonal and temporary employees are covered under Social Security, which requires these employees and the City to each contribute 6.2 ~ percent of the employees' pay. The City entered into an agreement with the PARS to provide an alternative retirement system for the part-time employees. The PARS plan was effective December 25, 2005, and replaced Social Security. The employees contributed $52,740 or 6% of salary and the City contributed $13,267 or 1.5% of employee's pay towards PARS. 12. POSTEMPLOYMENT HEALTHCARE PLAN A. City of Dublin Retiree Health Plan Plan Description. City of Dublin (City) Retiree Health Plan is asingle-employer defined benefit healthcare plan admuzistered by the California Public Employees Retirement System (Ca1PERS). The plan provides medical insurance benefits to eligible retirees and their eligible dependents. In accordance with Public Employee Retirement Law (Article 2). The Public Employees Retirement System Board of Administration has the responsibility to approve health benefit plans and may contract with carvers offering health benefit plans. The Board of Administration is responsible for adopting all rules and regulations, including the scope and content of basic health plans. The California Government Code also defines certain rules for contract agencies, such as the City of Dublin, to purchase health insurance benefits. Funding Policy. There is no requirement imposed by CaIPERS, to contribute any amount beyond the pay-as- you-go contributions. The cost of monthly insurance premiums may be shared between the retiree and the City. The cost sharing varies depending on: date of hire (a vesting schedule is in place for employees hired """ after April 1, 2004); the dependent status; and plan selected. A minimum employer monthly contribution .~; requirement is established and may be amended by the Ca1PERS Board of Administration and applicable laws. Within the parameters of the law, individual contracting agencies, such as the City, are allowed to "'~ establish and amend the level of contributions made by the employer towards the monthly cost of the plans. Changes to the employer contribution rate towards retiree benefits are recorded in a resolution adopted by .. the City Council. The City has established a policy to make contributions to an Internal Service Fund, for the purpose of funding its calculated obligations over a period of time, with the intent the funds will be transferred to CALPERS periodically at which time the transfers will be recorded as Cash with Fiscal Agent in a Trust Fund. The amount necessary to fund future benefits is based on projections from the June 30 2007 Actuarial Study completed by Bartel and Associates, LLC in accordance with GASB Statement 45, Accounting and Financial Reporting for Postemployment Benefits Other than Pensions. 8da~l~a City of Dublin Notes to Basic Financial Statements, Continued For the year ended June 30, 2009 12. POSTEMPLOYMENT HEALTHCARE PLAN, Continued A. City of Dublin Retiree Health Plan, Continued For fiscal year 2009, the City made a total of $816,097 in contributions, of which $551,122 represented current contributions and $264,975 represented amounts added to the City's Retiree Health Care Internal Service -• Fund to set aside funds for future benefits. There was no premiums contribution paid by the retirees that exceeded the monthly contribution established by the City. During Fiscal Year 2006-2007, the City made arrangements with CaIPERS to retain the OPEB assets to finance future Retiree Health Benefits. On June 29, 2007 the City transferred $5,468,611 from the Internal Service Fund into the California Employers' Retiree Benefit Trust Fund (CERBT). During fiscal year 2008-2009, the City made additional quarterly transfers amounted to $667,938. The City has elected a one year amortization period for the OPEB plan assets deposited into the CERBT, as permitted under GASB Statement 45, paragraph 13F, amortization periods allow for a maximum of 30 years with no minimum years. As of June 30, 2009, the Internal Service Fund held a remaining total of $9,994 to be transferred to Ca1PERS during Fiscal Year 2009-2010. Annual OPEB Cost and Net OPEB Obligation. The City's annual Other Post Employment Benefit (OPEB) cost (expense) is calculated based on the Annual Required Contribution of the employer (ARC), an amount actuarially determined in accordance with the parameters of GASB Statement 45. The ARC represents a level of funding that, if paid on an ongoing basis, is projected to cover normal cost each year and amortize any unfunded actuarial liabilities (or funding excess) over a period not to exceed thirty years. The following table shows the components of the City of Dublin annual OPEB costs for the year, the amount actually contributed to the plan, and changes in the City's net OPEB obligation to the City Retiree Health Plan: Annual required contribution $ 511,000 Interest an ret OPEB obligation - Adjustment to annual required contribution - Annual OPEB expense (income) 511,000 Contributions rrrade (816,097) Increase (deQease) in net OPEB obligation ~, (305,097) Net OPEB obligation (asset)-beginning of year (211,418) ~° Net OPEB obligation (asset) -eud of year $ (516,515) The City Retiree Health annual OPEB cost, the percentage of annual OPEB cost contributed to the plan, and the net OPEB obligation for 2009, and the preceding years were as follows:. Fiscal Percentage of Net Year Annual AnnuaIOPEB OPEB Fiscal Year Ended OPEB Cost Cost Contributed Obligation (Asset) 6/30/2007 '~ 6/30/2008 6/30/2009 5,179,702 100.00% $ - 511,000 141.37% (211,418) 511,000 159.71 % (516,515) 47 83 ~~ Asa . City of Dublin Notes to Basic Financial Statements, Continued For the year ended June 30, 2009 12. POSTEMPLOYMENT HEALTHCARE PLAN, Continued A. City of Dublin Retiree Health Plan, Continued Funded Status and Funding Progress. As of June 30, 2007, the most recent actuarial valuation date, the plan ~„ was 72.7% funded. The Actuarial Accrued Liability (AAL) for benefits was $6,159,000, and the Actuarial value of Plan Asset was $5,694,000, resulting in an Unfunded Actuarial Accrued Liability (UAAL) of ~` $465,000. The covered payroll (annual payroll of active employees covered by the plan) was 6,697,747, ~ and the ratio of UAAL to the covered payroll was 6 percent. Actuarial valuations of an ongoing plan involve estimates of the value of reported amounts and assumptions about the probability of occurrence of events far into the future. Examples include assumptions about future employment, mortality, and the healthcare cost trend. Amounts determined regarding the funded status of the plan and the annual required contributions of the employer are ,,. subject to continual revision as actual results are compared with past expectations and new estimates are made about the future. The Schedule of Funding Progress, presented as Required Supplementary Information following the notes to the financial statements, presents multiyear trend information about whether the actuarial value of plan assets is increasing or decreasing over time relative to the actuarial accrued liabilities for benefits. Since this is the first year of including this information in the financial report, the data presented is limited. Actuarial Methods and Assumptions. Projections of benefits for financial reporting purposes are based on the substantive plan (the plan as understood by the employer and the plan members) and include the types of benefits provided at the time of each valuation and the historical pattern of sharing of benefit costs between the employer and plan members to that point. The actuarial methods and assumptions used include techniques that are designed to reduce the effects of short-term volatility in actuarial •~ accrued liabilities and the actuarial value of assets, consistent with the long-term perspective of the ~, calculations. In the June 30, 2007 actuarial valuation, the actuarial cost method used is Entry Age Normal (EAN) cost ~„ method. Under the EAN cost method, the plan s Normal Cost is developed as a level percent of payroll throughout the participants' working lifetime. Entry age is based on current age minus years of service. ~ Actuarial Accrued Liability (AAL) is the cumulative value on the valuation date, of prior Normal Cost. ,~. For the retirees, the AAL is the present value of all projected benefit. The Unfunded AAL is being amortized as a level dollar closed 30 year basis, as a level percent of payroll with a remaining ~° amortization period at June 30, 2008 of 30 years. ,~ GASB 45 requires the interest rate to represent the underlying expected return for the source of funds used to pay benefits. The actuarial methods and assumptions included 7.75 percent interest rate, representing the long term expected rate of return on the Ca1PERS Trust Fund. Annual inflation assumed to increase at 3 percent per annum and Aggregate Payroll assumed to increase at 3.25 percent per annum. The study also used assumptions for the salary merit and longevity increases, and demographic assumptions such as mortality, withdrawal, and disability based on Ca1PERS 1997-2002 Experience Study. Retirement assumption was also based on Ca1PERS 1997-2002 Experience Study of the Miscellaneous Plan 2.7% at 55 years, with expected retirement age of approximate 59 for females and 60 for males. .~ ~r City of Dublin Notes to Basic Financial Statements, Continued For the year ended June 30, 2009 12. POSTEMPLOYMENT HEALTHCARE PLAN, Continued A. City of Dublin Retiree Health Plan, Continued The following table includes the annual healthcare cost trend rate used in the Actuarial Valuation: Year Non-Medicare HMO PPO Medicare HMO PPO 2008 10.4% 11.3% 10.8% 11.7% 2009 9.7% 10.5% 10.1% 10.9% 2010 9.1% 9.8% 9.4% 10.1% 2017 4.5% 4.5% 4.5% 4.5% B. Dougherty Regional Fire Authority Health Plan Dougherty Regional Fire Authority Background. In 1988, the cities of Dublin and San Ramon formed Dougherty Regional Fire Authority (DRFA), a joint powers agency (JPA). The JPA provided fire services to all of Dublin and the southern portion of San Ramon. In 1997, the two cities decided to change how Fire Services would be provided in each City. As a result JPA personnel were absorbed by the two new service providers pursuant to a mutual agreement. The JPA has remained intact to conclude the financial affairs of the entity. This includes residual retiree obligations and workers compensation liabilities. Dublin s share of all DRFA close-out expenses, including retiree medical benefits, is 57.51 % of the actual costs, with the City of San Ramon paying 42.49% of the costs. The two cities have entered into a binding agreement to share these expenses on this basis. The City of Dublin is presenting information only for its contractual share of the obligations. Plan Description. City of Dublin share of DRFA Retiree Health Plan is asingle-employer defined benefit healthcare plan administered by the California Public Employees Retirement System (Ca1PERS). The Plan provides medical insurance benefits to eligible retirees and their eligible dependents. In accordance with Public Employee Retirement Law (Article 2), the Public Employees Retirement System Board of Administration has the responsibility to approve health benefit plans and may contract with carriers offering health benefit plans. The Board of Administration is responsible for adopting all rules and regulations, including the scope and content of basic health plans. The California Government Code also defines certain rules for contract agencies, such as DRFA, to purchase health insurance benefits. '~ Funding Policy. There is no requirement imposed by Ca1PERS, to contribute any amount beyond the pay-as-you-go contributions. The cost of monthly insurance premiums may be shared between the retiree and DRFA. The cost sharing varies depending on: the bargaining unit; dependent status; and ~' plan selected. A minimum employer monthly contribution requirement is established and may be amended by the Ca1PERS Board of Administration and applicable laws. Within the parameters of the law, individual contracting agencies, such as the DRFA, are allowed to establish and amend the level of ~' contributions made by the employer towards the monthly cost of the plans. Changes to the employer contribution rate towards retiree benefits are recorded in a resolution adopted by the DRFA Management Committee. ~ 49 City of Dublin Notes to Basic Financial Statements, Continued For the year ended June 30, 2009 12. POSTEMPLOYMENT HEALTHCARE PLAN, Continued B. Dougherty Regional Fire Authority Health Plan, Continued For fiscal year 2008-2009, the City contributed $46,681 to the plan, all of which was for current premiums. No other contributions were made. Annual OPEB Cost and Net OPEB Obligation. The DRFA Retiree Health Plan (City of Dublin Share) annual other post employment benefit (OPEB) cost (expense) is calculated based on the annual required contribution of the employer (ARC), an amount actuarially determined in accordance with the ' parameters of GASB Statement 45, Accounting and Financial Reporting for Postemployment Benefits Other than Pensions. The ARC represents a level of funding that, if paid on an ongoing basis, is projected to cover costs. This plan is in a unique status since there are no active members and no "normal" cost '~ component. Therefore, 100% of the calculated ARC relates to the amortization of unfunded actuarial .~ liabilities (or funding excess) over a period not to exceed thirty years. The following table shows the components of the City of Dublin share of DRFA annual OPEB cost for the year, the amount actually contributed to the plan and changes in the Dublin Share of DRFA net OPEB and the City of Dublin share of the obligation to DRFA Retiree Health Plan: s Annual required contribution $ 111,000 Interest on net OPEB obligation 2000 Adjustment to annual required contribution (3,000) ~r Annual OPEB exper-se (income) 110,000 a Contr~butiorts made (46,681) Increase (decrease) in netOPEB obligation 6319 '"~` NetOPEB obligation (asset)-beginning of year 87,796 ~„ Net OPEB obligation (asset) -end of year $ 151,065 The DRFA Retiree Health (City of Dublin Share) annual OPEB cost, the percentage of annual OPEB cost contributed to the plan, and the net OPEB obligation for 2008 and the previous year were as follows: ~" .~ Fiscal Percentage of Net Year Annual AnnuaIOPEB OPEB Ended OPEB Cost Cost Contributed Obligation ,,,~,,. 6/30/2007 $ 76,206 81.53% $ 44,013 a.. 6/30/2008 110,000 60.24% 87,746 ~ 6/30/2009 110,000 42.44% 151,065 . . Funded Status and Funding Progress. As of June 30, 2007, the most recent actuarial valuation date, the plan was not funded. Therefore, both the actuarial accrued liability for benefits and the unfunded actuarial accrued liability (UAAL) equaled $1,444,000. Since there are no active employees, it is not possible to calculate a comparison of the liability to the payroll. t„ g5 bd I g~ ~. ~n 86 of/8a City of Dublin Notes to Basic Financial Statements, Continued For the year ended June 30, 2009 12. POSTEMPLOYMENT HEALTHCARE PLAN, Continued B. Dougherty Regional Fire Authority Health Plan, Continued Actuarial valuations of an ongoing plan involve estimates of the value of reported amounts and assumptions about the probability of occurrence of events far into the future. Examples include n~ assumptions about, mortality, and the healthcare cost trend. Amounts determined regarding the funded status of the plan and the annual required contributions of the employer are subject to continual revision as actual results are compared with past expectations and new estimates are made about the .b future. The Schedule of Funding Progress, presented as Required Supplementary Information following the notes to the financial statements, presents multiyear trend information about whether the actuarial value of plan assets is increasing or decreasing over time relative to the actuarial accrued liabilities for benefits. Since this is the first year of including this information in the financial report, the data presented is limited. ,, ~ Actuarial Methods and Assumptions. Projections of benefits for financial reporting purposes are based on the substantive plan (the plan as understood by the employer and the plan members) and include the '" types of benefits provided at the time of each valuation and the historical pattern of sharing of benefit costs between the employer and plan members to that point. The actuarial methods and assumptions used include techniques that are designed to reduce the effects of short-term volatility in actuarial accrued liabilities and the actuarial value of assets, consistent with the long-term perspective of the calculations. In the June 30, 2007 actuarial valuation prepared by Bartel Associates, LLC the actuarial cost method used was the Entry Age Normal (EAN) cost method. Under the EAN cost method, the plan's Normal Cost is developed as a level percent of payroll throughout the participants' working lifetime. The actuarial assumptions included a 4.5% investment rate of return (net of administrative expenses), ~, calculated based on the funded level of the plan at the valuation date. An inflation healthcare cost trend rate of 3 % was assumed to increase per annum. The Actuarial Accrued Liability (AAL) is the "" cumulative value, on the valuation date, of prior Normal Costs. For retirees, the AAL is the present value of all projected benefits. The unfunded AAL is amortized over 20 years as a level of dollar amount. ~, 13. COMMITMENT AND CONTINGENT LIABILITIES A. Grant Programs The City participates in several Federal and State grant programs. No cost allowances were proposed as a result of the City's financial audit; however, these programs are still subject to further examination by ~' the grantors and the amount, if any, of expenditures, which may be disallowed by the granting agencies cannot be determined at this time. The City expects such amounts, if any, to be immaterial. ~- B. Litigation ~" The City is subject to litigation arising in the normal course of business. In the opinion of the City Attorney there is no pending litigation, which is likely to have a material adverse effect on the financial position of the City. „„ 51 g~~ ~ iga . City of Dublin Notes to Basic Financial Statements, Continued For the year ended June 30, 2009 13. COMMITMENT AND CONTINGENT LIABILITIES, Continued C. Reimbursements to the City of Pleasanton ~, On January 23,1996, the City adopted a fee for the purpose of reimbursing the City of Pleasanton for the costs of making improvements to the interchanges on Interstate 580 at Hacienda Drive and Tassajara ~ Road/Santa Rita Road that benefit development in both Pleasanton and future development in Eastern Dublin. The Cities entered into an agreement on November 3, 1998, to allow for an automatic annual escalator factor in the amount of the fee assessed to developers based upon the LAIF interest rate and to repay the City of Pleasanton. The amount of the contingent liability outstanding at June 30, 2009, was '"` $4,750,739, which is net of the $16,012 in payments made by the City to reduce this contingent liability ~ during the year. The accounting for the amount due is not recorded as indebtedness since future payments are contingent upon the future collection of development fees assessed for reimbursement of `~' these improvements. .. The City has also entered into an agreement with the City of Pleasanton for the reimbursement of the cost of construction of a two-lane access road and the extension of Hacienda Drive. Interest accrues on the reimbursement at 7.48 percent per year. The advance as of June 30, 2009, is $183,423 which is net of the $1,453,430 in payments made by the City to reduce this contingent liability during the year. The reimbursement is to be repaid from proceeds of assessments, special taxes or fees imposed on the property east of Dougherty Road with no specific due date. The City's General Fund shall not be obligated to repay this obligation. The accounting for the amount due is not recorded as indebtedness since future payments are contingent upon the future collection of development fees assessed for reimbursement of these improvements. D. BART Agreement In 1990, the City and Bay Area Rapid Transit City (BART) entered into a Settlement Agreement regarding the City's extension of Dublin Boulevard to the extension of Hacienda Drive. BART ,~„ advanced the City $2,285,000 to purchase land and construct the road extensions. The advance was structured with two components: a Short Term and a Long Term Advance. These projects are now `~ complete. .• Short Term Advance The amount provided as a Short Term Advance came due on December 31, 1995. In accordance with a separate agreement, the Alameda County Surplus Property Authority repaid this amount. See the related note on the Alameda County Surplus Property Authority below. ~~ .~ ..,.~ ~w B8 of J8~ City of Dublin Notes to Basic Financial Statements, Continued For the year ended June 30, 2009 - 13. COMMITMENT AND CONTINGENT LIABILITIES, Continued D. BART Agreement, Continued Long Term Advance BART's long term advance to the City, including accrued interest as of June 30, 2009 is $2,485,522 which has no specific due date. Under the City's agreement with BART, interest on the advance accrues at a rate based on BART's average rate of return on its investments. During the year ended June 30, 2009 unpaid interest incurred was added to the balance owed in the amount of $103,795. The City expects to repay principal and interest on BART's advance out of developer fees, charges and other non-tax revenues generated by future development in the area of the BART station. The agreement states that in no event is the advance to be repaid from the City's General Fund or from general revenues. The agreement provides for the forgiveness by BART of any principal or interest still outstanding on March 27, 2010. The accounting for the amount due is not recorded as indebtedness since future `~' payments are contingent upon the future collection of development fees assessed for repayment of the advance. The debt is budgeted to be paid in full on July 1, 2009. ' E. Alameda County Surplus Property Authority The City entered into an agreement with the Alameda County Surplus Property Authority for the repayment of the City's Short Term BART Advance by the Authority. Under the terms of the ~, agreement, interest on the advance shall accrue at a rate based on the Alameda County Treasurers return on investments. As of June 30, 2009, the advance is $2,602,995, which includes accrued interest of `~ $56,282 at 2.21 % for the current year. The advance is to be repaid from developer fees, charges, and other non-tax revenues from the benefiting area and has no specific due date. The City's General Fund shall not be obligated to repay this obligation. The accounting for the amount due is not recorded as "`~ indebtedness since future payments are contingent upon the future collection of development fees assessed for repayment of the advance. F. Other Development Agreements The City entered into several agreements with various developers and merchant builders who are "'" developing numerous residential and commercial projects throughout the City. The City agreed to grant the developers' impact fee credits since the developers constructed certain improvements beyond what was needed to serve their specific projects. The value of credits does not increase for inflation nor ~" do they accrue interest. Any unused credits may be used by the developers on other projects located within the Traffic Impact Fee area. The value of the credits as of June 30, 2009 was $94,124,963. For the current year, additions to the credits amounted to $35,251,381 and credits used and transferred ~' amounted to $446,770. The accounting for the amounts due are not recorded as indebtedness since the ,, payments (use of credits) are contingent upon the collection of development fees from building growth that has not yet occurred. ~~ City of Dublin Notes to Basic Financial Statements, Continued For the year ended June 30, 2009 14. DEFICIT FUND BALANCE The Fire Impact Fees Fund ended the fiscal year with a $1,841,021 deficit fund balance. The General Fund has advanced money to this fund to cover current cash flow needs. Repayment of the advance is expected to come from future revenues to this fund. 15. PRIOR PERIOD ADJUSTMENTS Government-Wide Financial Statements Prior period adjustments were recorded in the Government-Wide Financial Statement as follows: - Removal of Accumulated Depreciation in the amount of $427,434 for an Infrastructure asset not recorded in fiscal year 2007-2008. - Reporting Deferred Revenue $1,250,000 for the West Dublin Bart Station receivable previously recorded on the City's fiscal year 2007-2008 financial records however was not reported in the fiscal year 2007-2008 CAFR. - Recording a refund in the amount of $2,216,700 for excess fees collected in fiscal year 2007-2008 pursuant to the Fallon Interchange construction agreement. Net Assets as Previously Prior Period Net Assets, Reported Adjustments as Restated Government-4Vde Activities Net Assets Fund Financial Statements: $ 531,687,733 $ (3,039,266) $ 528,648,467 Prior period adjustments in the Fund Financial Statements were recorded as follows: Traffic Impact Fees Fund Fund Balance, as Previously Prior Period Fund Balance, Reported Adjustments as Restated $ 2~77a,583 $ (3,466,700) $ 21,312,883 ..~ 16. TERMINATION BENEFITS During fiscal year 2008-2009 the City had incurred termination benefits for three non management positions. Two positions were eligible and elected to retire from service and one position was considered layoff. The benefits included a severance package that ranges from one to two months of the applicable position salary and continued access to insurance coverage for a period of six months. The cost of these benefits for which the payments are due was paid as of June 30, 2009. Sd ~9~ e-F /~a .~ ,.. .. '~ City of Dublin n Notes to Basic Financial Statements, Continued ,~ For the year ended June 30, 2009 17. SUBSEQUENT EVENTS -STATE OF CALIFORNIA FINANCIAL CRISIS qo o~ ~~a Subsequent to June 30, 2009, the State of California (State) has decided to borrow local property tax revenue, and to defer certain revenue payments from local governments including the City of Dublin. These amounts are very significant to the City and are as follows: - 8 % of Property Tax $2,237,598 - Gas Tax Revenues $776,449 Property Taxes borrowed by the State for fiscal year 2009-2010 were nearly $2 billion statewide to help the State's budget shortfall. Legislators and the Governor promised to allow local agencies to sell their eventual repayment from the State to investors to cover the property taxes and to pay the full cost of the sale, or = securitization. Passage of Senate Bill 67 (SB 67) was accomplished on October 14, 2009 and the Dublin City Council authorized participation in the securitization on October 20, 2009. On November 10, 2009 the bond sale was completed to provide the funding or securitization. The City has planned to use these funds in the > 2009-2010 budget and the funds are held in escrow to be distributed in accordance with the financing documents. The City will receive 100% of the amount borrowed by the State. Gas Tax revenues have had payments deferred to the local governments with funds to be released after January 1, 2010. ~~ giaf i8a #~p NEE . This page intentionally left blank. we- ..~ /~a~~~a REQUIRED SUPPLEMENTARY INFORMATION 57 93 ~~ ~~ ~:. City of Dublin Required Supplementary Information For the year ended June 30, 2008 1. BUDGETS AND BUDGETARY ACCOUNTING The City follows these procedures in establishing the budgetary data reflected in the basic financial statements: • Prior to June 30 the City Manager submits to the City Council a proposed operating budget for the fiscal year commencing the following July 1. The operating budget includes proposed expenditures and the means of financing them. • The public is given an opportunity to comment on the budget at a noticed City Council meeting. Prior to July 1, the budget is legally enacted through passage of a resolution. • The City Manager is authorized to transfer budgeted amounts between line items within any "` department. Any revisions, which alter total departmental expenditures of the City must be ,,,, approved by City Council except as follows: The City Manager will be allowed to transfer funds from the contingent reserve to operating departments salary and benefits accounts when *' required due to employee turnover or change in status, City Council approved funding for „~. increases in employees salaries and benefits, and City Council approved funding for increase in contract or labor rates. Expenditures may not exceed budgeted appropriations at the *' departmental level without City Council approval. ,~ • Formal budgetary integration is employed as a management control device during the year for "" the general fund, special revenue funds and capital projects funds. ~,; Budgets for the general, special revenue and capital projects funds are adopted on a basis ~`' consistent with generally accepted accounting principles in the United States. ~, • All unexpended appropriations lapse at the end of the fiscal year. ~" ..,, .~ ~ce ..~ ~.. 9y o~ /8~ City of Dublin Schedule of Revenues, Expenditures and Changes in Fund Balances -Budget and Actual Required Supplementary Information, Continued For the year ended June 30, 2009 General Fund Variance with Final Budget - Budget Amounts Actual Positive Original Final Amounts (Negative) ,~ REVENUES: Property taxes $ 22,920,050 $ 22,579,237 $ 23,164,422 $ 585,185 Sales tax 13,863,628 11,008,800 12,001,338 992,538 Other taxes 3,355,700 3,071,295 3,011,925 (59,370) Intergovernmental 1,002,700 956,173 416,007 (540,166) Licenses and permits 2,304,675 1,903,875 1,623,029 (280,846) t Charges for service 5,779,709 5,751,709 6,116,417 364,708 Investment Interest 2,336,137 1,921,137 4,028,586 2,107,449 Use of property 218,941 218,941 239,081 20,140 Fines and forfeitures 138,900 138,900 143,220 4,320 Other revenue 1,272,118 3,224,015 3,183,863 (40,152) Total revenues 53,192,558 50,774,082 53,927,888 3,153,806 EXPENDITURES: Current: a General government 6,332,761 6,338,280 5,923,895 414,385 Public safety 24,248,947 23,892,220 22,933,987 958,233 Highways and streets 2,298,841 2,362,857 2,313,349 49,508 Health and welfare 65,425 65,425 65,425 - Culture and leisure 7,744,814 7,774,827 7,612,207 162,620 Community development 7,031,306 6,789,836 6,216,750 573,086 Capital outlay: + General 1,638,137 5,771,557 4,203,910 1,567,647 Community improvement 328,570 115,610 59,293 56,317 Parks 5,881,201 7,095,701 4,126,677 2,969,024 Streets 1,670,680 2,604,860 1,780,978 823,882 Total expenditures 57,240,682 62,811,173 55,236,471 7,574,702 `"' REVENUES OVER (UNDER) EXPENDITURES (4,048,124) (12,037,091) (1,308,583) 10,728,508 OTHER FINANCING SOURCES (USES): Transfer in - - 19,632 19,632 .a Transfer out - - - - Total other financing sources (uses) - - 19,632 19,632 NET CHANGE IN FUND BALANCES $ (4,048,124) $ (12,037,091) (1,288,951) $ 10,748,140 ~ FUND BALANCES: '~ Beginning of year, as restated 63,412,309 ~x~ End of year $ 62,123,358 59 qs ~ ~~~ City of Dublin Schedule of Revenues, Expenditures and Changes in Fund Balances -Budget and Actual Required Supplementary Information, Continued For the year ended June 30, 2009 Housing and Noise Mitigation Special Revenue Fund REVENUES: Interest Loan Repayment Charges for services Developer fees Other revenue Total revenues EXPENDITURES: Current: General Government Health and welfare Total expenditures REVENUES OVER (UNDER) EXPENDITURES OTHER FINANCING SOURCES (USES): Transfers in Total financing sources (uses) Net change in fund balance FUND BALANCE: Beginning of year End of year Variance with Final Budget - Budget Amounts Actual Positive Original Final Amounts (Negative) $ 397,769 $ 397,769 $ 460,181 $ 62,412 - - 750,000 750,000 74,070 74,070 34,732 (39,338) 272,627 272,627 349 (272,278) - - 16,034 16,034 744,466 744,466 1,261,296 516,830 180,675 180,675 59,139 121,536 3,942,094 3,942,094 1,102,219 2,839,875 4,122,769 4,122,769 1,161,358 2,961,411 (3,378,303) (3,378,303) 99,938 3,478,241 - - 6,600 6,600 - - 6,600 6,600 $ (3,378,303) $ (3,378,303) 106,538 $ 3,484,841 12,855,510 $ 12,962,048 60 9~~~~~ City of Dublin Required Supplementary Information, Continued For the year ended June 30, 2009 Schedule o Funding in Progress Miscellaneous Plan of the California Public Em~loi~ee Retirement System The City contributes to the California Public Employee's Retirement System (Ca1PERS), as an agent multiple -employer public employee defined benefit pension plan. As part of the actuarial valuation date of June 30, 2003, the City's miscellaneous plan became part of a Ca1PERS Risk Pool for employers with less than 100 active plan members. As part of a cost sharing, multiple-employer defined benefit plan, disclosure of the Schedule of Funding progress is not required. Information on the funding schedule for the pool may be obtained with Ca1PERS. Schedule of Funding in Progress Other Post Employment Benefit (OPEB) The City contributes to the California Public Employee's Retirement System became part of a Ca1PERS Risk Pool for employers with less than 100 active plan members. As part of acost-sharing multiple-employer defined benefit plan, disclosure of the schedule of funding progress is not required Actuarial Accrued Unfunded UAAL as a Actuarial Liability (Overfunded) Percentage of Actuarial Value of (AAL) - AAL Funded Covered Covered Valuation Assets Entry Age (UAAL) Ratio Payroll Payroll Date (A) (B) (B-A) (A/B) ('C) ((B-A)/C) 6/30/2004 $ - $ 4,973,780 $ 4,973,780 0.0% $ 6,320,280 78.7% 6/30/2007 4,475,095 6,159,000 1,683,905 72.7% 6,697,747 25.1% ~, This page intentionally left blank. .,~ %fjo~ /8a SUPPLEMENTARY INFORMATION 63 ~g a~ /g~ ~, This page intentionally left blank. ~- l~ of i8a GENERAL FUND The General Fund is used to account for all financial resources except those required to be accounted for in another fund. 65 /a~ ~ ~s~ . W This page intentionally left blank. .~ ~~ ` /~~ ~/ ~a~ City of Dublin Schedule of Budget Versus Actual Revenues by Sources General Fund For the year ended June 30, 2009 Variance with Final Budget - Budgeted Amo unts Actual Positive Original Final Amounts (Negative) Property Taxes: Current year secured $ 17,000,000 $ 17,000,000 $ 16,894,614 $ (105,386) Current year unsecured 973,550 973,550 1,081,425 107,875 Supplemental property tax 875,000 534,187 608,457 74,270 Prior year secured 370,000 370,000 732,754 362,754 Prior year unsecured 10,000 10,000 46,141 36,141 Property tax penalties 135,000 135,000 247,222 112,222 In lieu property tax 3,550,000 3,550,000 3,524,237 (25,763) Housing Authority Pilot tax 6,500 6,500 29,572 23,072 Sub-total 22,920,050 22,579,237 23,164,422 585,185 Taxes Other Than Property: Sales & use tax 13,863,628 11,008,800 12,001,338 992,538 Real property transfer tax 322,000 275,000 254,022 (20,978) Hotel transient occupancy tax 796,000 590,000 577,057 (12,943) Franchise taxes 2,237,700 2,206,295 2,180,846 (25,449) Sub-total 17,219,328 14,080,095 15,013,263 933,168 License and Permits: Building permits 2,008,720 1,626,920 1,340,766 (286,154) Animal licenses 5,000 5,000 4,910 (90) Encroachment permits 20,377 20,377 28,986 8,609 Construction and demolition permits 76,626 41,626 33,779 (7,847) Business license 146,000 146,000 143,235 (2,765) Fire permits 47,952 63,952 71,353 7,401 Sub-total 2,304,675 1,903,875 1,623,029 (280,846) Fines and Forfeitures: Parking fines 84,500 84,500 84,912 412 Other court fines 50,000 50,000 52,258 2,258 Other fines & penalties 4,400 4,400 6,050 1,650 Sub-total 138,900 138,900 143,220 4,320 Revenue From Use of Money and Property: Interest 2,336,137 1,921,137 2,308,626 387,489 Change in Fair Market Value of Investments - - 1,719,960 1,719,960 Rent & Concession: Field rentals 77,800 77,800 81,734 3,934 Pool 2,420 2,420 1,079 (1,341) Heritage Center 2,100 2,100 3,712 1,612 Facility rentals 94,621 94,621 110,556 15,935 Dublin Square Property Rental 42,000 42,000 42,000 - Sub-total 2,555,078 2,140,078 4,267,667 2,127,589 (Continued) h7 City of Dublin Schedule of Budget Versus Actual Revenues by Sources General Fund, Continued For the year ended June 30, 2009 Intergovernmental Revenues: Vehicle License Fee Homeowner's property tax relief Mandated Costs Workforce Housing Grant Public Safety Grant Stormwater Project Grant Heritage Center Grant Sub-total Charges for Services: Zoning & subdivision fees Plan check & inspection fees Sale of maps and documents Special police services Fire plan check and inspection fees Fire services Solid waste fees Cemetery Heritage Center Cultural arts Special events Playgrounds Recreation instruction Preschool Teens Building use insurance Senior Program Sports Program Aquatics Zone 7 drainage fees Green Building fees DUI program Booking fees recovery Annexation Cable support fees Sub-total Other Revenues: Sale of property Contributions Miscellaneous Reimbursement -general Reimbursement -public damage Reimbursement - Commuty Benefit Assessment Reimbursement -Other Sub-total Total revenues by sources Variance with Final Budget - Budgeted Amo unts Actual Positive Original Final Amounts (Negative) $ 207,000 $ 122,200 $ 160,242 $ 38,042 190,000 185,000 182,266 (2,734) - - 10,955 10,955 - 42,273 31,986 (10,287) 605,700 605,700 - (605,700) - 1,000 30,558 29,558 1,002,700 956,173 416,007 (540,166) 1,688,909 1,688,909 1,945,225 256,316 1,434,304 1,409,304 1,516,522 107,218 11,500 11,500 29,239 17,739 78,000 82,300 69,226 (13,074) 138,600 98,600 97,270 (1,330) 710,000 710,000 715,254 5,254 152,500 152,500 144,831 (7,669) 4,695 4,695 5,150 455 11,200 11,200 6,035 (5,165) 123,000 123,000 135,749 12,749 160,670 160,670 132,383 (28,287) 305,850 305,850 279,628 (26,222) 132,320 157,320 137,418 (19,902) 128,950 148,950 155,638 6,688 78,110 78,110 79,329 1,219 4,560 4,560 5,900 1,340 87,323 87,323 90,137 2,814 236,140 236,140 302,428 66,288 208,090 208,090 190,543 (17,547) 8,988 988 3,489 2,501 - - 140 140 4,300 - - - - - 2,407 2,407 71,700 71,700 72,476 776 5,779,709 5,751,709 6,116,417 364,708 87,050 90,050 80,810 (9,240) 19,330 29,330 47,836 18,506 953,905 1,892,802 1,806,175 (86,627) 11,163 11,163 31,592 20,429 200,670 1,200,670 1,217,450 16,780 1,272,118 3,224,015 3,183,863 (40,152) $ 53,192,558 $ 50,774,082 $ 53,927,888 $ 3,153,806 (Concluded) ~u ion ~~' i~a City of Dublin Schedule of Budget Versus Actual Departmental Expenditures General Fund For the year ended June 30, 2009 General Government: City Council City Manager Election cost center Central services "' Insurance cost center City Attorney Administrative services Building management Nondepartmental Sub-total Public Safety: Police Fire services ' Disaster preparedness Crossing guards Animal control Traffic signals and street lighting Sub-total Highways and Streets: Public works administration Street maintenance Street sweeping Street tree maintenance Street landscape maintenance Sub-total Health and Welfare: Child care ~; Social services Sub-total ,~ Culture and Leisure: Community cable television Library services Heritage and Culture Arts "~' Park maintenance Parks and community services Parks and facilities management Sub-total Variance with Final Budget - Budgeted Amo unts Actual Positive Original Final Amounts (Negative) $ 292,096 $ 292,096 $ 236,760 $ 55,336 1,231,303 1,196,303 1,153,279 43,024 106,120 36,120 29,439 6,681 602,646 566,646 507,657 58,989 527,781 555,949 555,949 - 714,979 932,240 932,239 1 1,865,327 1,852,827 1,763,596 89,231 881,409 809,909 733,902 76,007 111,100 96,190 11,074 85,116 6,332,761 6,338,280 5,923,895 414,385 13,542,747 13,476,020 12,754,923 721,097 10,053,362 9,763,362 9,631,597 131,765 137,701 137,701 106,066 31,635 100,622 100,622 94,070 6,552 400,670 400,670 334,592 66,078 13,845 13,845 12,739 1,106 24,248,947 23,892,220 22,933,987 958,233 1,144,148 1,144,148 1,102,500 41,648 34,921 44,838 44,837 1 145,605 145,605 143,715 1,890 124,847 124,847 118,879 5,968 849,320 903,419 903,418 1 2,298,841 2,362,857 2,313,349 49,508 18,500 18,500 18,500 - 46,925 46,925 46,925 - 78,445 78,872 78,872 - 855,380 873,318 873,318 - 535,744 536,744 517,175 19,569 2,074,027 2,049,027 2,001,562 47,465 3,979,955 3,979,957 3,884,371 95,586 221,263 256,909 256,909 - 7,744,814 7,774,827 7,612,207 162,620 (Continued) 69 °, ~~ ~ ~~ City of Dublin Schedule of Budget Versus Actual Departmental Expenditures General Fund, Continued For the year ended June 30, 2009 Community Development: Planning/building safety Engineering Economic development Sub-total Capital Outlay: General improvements Community improvements Parks Street construction and improvements Sub-total Total expenditures Variance with Final Budget - Budgeted Amounts Actual Positive Original Final Amounts (Negative) $ 4,955,860 $ 4,591,260 $ 4,057,413 $ 533,847 1,796,437 1,947,067 1,947,067 - 279,009 251,509 212,270 39,239 7,031,306 6,789,836 6,216,750 573,086 1,638,137 5,771,557 4,203,910 1,567,647 328,570 115,610 59,293 56,317 5,881,201 7,095,701 4,126,677 2,969,024 1,670,680 2,604,860 1,780,978 823,882 9,518,588 15,587,728 10,170,858 5,416,870 $ 57,240,682 $ 62,811,173 $ 55,236,471 $ 7,574,702 (Concluded) ~n l~ ~' i~a City of Dublin Schedule of Revenues, Expenditures and Changes in Fund Balances - Budget and Actual -Traffic Impact Fees Capital Projects Fund -Major Fund For the year ended June 30, 2009 Variance with Final Budget - Budgeted Amounts Actual Positive Original Final Amounts (Negative) REVENUES: Interest $ 770,678 $ 770,678 $ 655,742 $ (114,936) Developer fees 1,556,741 952,759 841,221 (111,538) Miscellaneous - 23,592 24,770 1,178 Total revenues 2,327,419 1,747,029 1,521,733 (225,296) EXPENDITURES: Current: General government 5,125 5,125 800 4,325 Community development - 23,592 23,592 - Capital outlay: Streets 19,485,260 19,222,467 10,918,188 8,304,279 Total expenditures 19,490,385 19,251,184 10,942,580 8,308,604 REVENUES OVER (UNDER) EXPENDITURES (17,162,966) (17,504,155) (9,420,847) 8,083,308 OTHER FINANCING SOURCES (USES): Transfer in - - - Transfer out - - - - Total other financing sources (uses) - - - - r Net change in fund balance $ - $ - (9,420,847) $ (9,420,847) FUND BALANCE: "~ Beginning of year 21,312,883 End of year $ 11,892,036 71 i~ r ~ ~~a City of Dublin Schedule of Revenues, Expenditures and Changes in Fund Balances - Budget and Actual -Public Facilities Fees Capital Projects Fund -Major Fund For the year ended June 30, 2009 REVENUES: Interest Developer fees Total revenues EXPENDITURES: Current: General Capital outlay: General Parks Total expenditures Net change in fund balance FUND BALANCE: Beginning of year End of year Variance with Final Budget - Budgeted Amounts Actual Positive Original Final Amounts (Negative) $ 249,213 $ 249,213 $ 212,011 $ (37,202) 8,915,787 7,478,998 975,305 (6,503,693) 9,165,000 7,728,211 1,187,316 (6,540,895) 4,100 4,100 1,456 2,644 14,864 150,896 18,046 132,850 6,178,217 7,811,302 5,072,019 2,739,283 6,197,181 7,966,298 5,091,521 2,872,133 $ 2,967,819 $ (238,087) (3,904,205) $ (3,666,118) 7,700,327 /D8 ~~ is~ City of Dublin Schedule of Revenues, Expenditures and Changes in Fund Balances - Budget and Actual -Public Art Fees Capital Projects Fund -Major Fund For the year ended June 30, 2009 REVENUES: Interest Developer fees Total revenues EXPENDITURES: Capital outlay: Culture and leisure Capital outlay: Community Improvement Total expenditures Net change in fund balance ' FUND BALANCE: Beginning of year End of year Variance with Final Budget - Budgeted Amounts Actual Positive Original Final Amounts (Negative) $ 9,414 $ 9,414 $ 13,099 $ 3,685 9,414 9,414 13,099 3,685 - 8,000 8,000 - 250,000 250,000 8,943 241,057 250,000 258,000 16,943 241,057 $ (240,586) $ (248,586) $ (3,844) $ (237,372) 379,623 $ 375,779 73 /~I a~ /$~ City of Dublin Schedule of Revenues, Expenditures and Changes in Fund Balances - Budget and Actual -Fire Impact Fees Capital Projects Fund -Major Fund For the year ended June 30, 2009 Budgeted Amounts Original Final REVENUES: Developer fees Total revenues Variance with Final Budget - Actual Positive Amounts (Negative) 218,746 $ 64,296 $ 218,746 64,296 EXPENDITURES: Current: General Government Total expenditures Net change in fund balance FUND BALANCE: Beginning of year End of year $ 218,746 $ 58,966 $ (5,330) 58,966 (5,330) - 63,281 (63,281) - 63,281 (63,281) 64,296 (4,315) $ (68,611) (1,837,021) $ (1,841,336) ~d lid eF /8a NON-MAJOR GOVERNMENTAL FUNDS Special Revenue Funds are used to account for the proceeds of specific revenue sources (other than major capital projects) that are legally restricted to expenditures for specific purposes. Special Criminal Activity Fund - Established to account for receipt of funds derived from asset forfeitures. Vehicle Abatement Fund - Established to account for the use of funds received from vehicle registration of Dublin residents for the towing of abandoned vehicles in city limits. Supplemental Law Enforcement (SEES/COPS) -Established to account for police expenditures funded by a State grant. Traffic Safety Fund - Established to account for the receipt of traffic fines and traffic safety expenditures. EMS Fund - Established to account for excise taxes received to fund the costs of providing Emergency Medical Services. State Gas Tax Fund - Established to account for receipt of state gasoline taxes and expenditures. TEA 21 (Transportation Equity Act for the 21st Century) -Established to account for the revenue received from the Department of Transportation under the Federal surface transportation programs for highways, highway safety, and transit. Measure B Sales Tax Transportation Fund - Established to account for an Alameda County voter approved increase in sales tax used for improvements on streets and roads. Measure B Bike and Pedestrian - Established to account for an Alameda County voter approved increase in sales tax used for bike and pedestrian related projects. Traffic Congestion Relief - Established to account for traffic congestion relief expenditures funded by a State grant. ~, Measure D Recycling Fund -Established to account for the use of funds received which are levied by the County pursuant to a charter amendment and are provided for recycling and related activities. This fund also accounts for other locally derived funds for recycling related activities ® Garbage Service Fund - Established to account for the use of funds received which are levied by the county on behalf of the City for garbage pick-up and removal and recycling services. "' 75 //1 ~ /~~, NON-MAJOR GOVERNMENTAL FUNDS Local Recycling Fund -Established to account for locally derived funds collected for a commercial A organic and recycling program and activities retained by the City at the end of the franchise held by ~ Waste Management Inc. These funds are independent of the funds distributed by Stop Waste pursuant to the Alameda County Recycling Measure. °" East Bay Regional Park District - Establish to account for revenue and related expenditures of Measure WW -East Bay Regional Park District. Community Development Block Grant (CDBG) Fund -Used to account for grants and expenditures related to community development block grants. Maintenance Districts -Established to account for revenue and related expenditures of lighting and landscape districts. A. ~w ~~ //a a ~ ~8a This page intentionally left blank. ~+ 77 ,,3 df ga City of Dublin Combining Balance Sheet Non-Major Governmental Funds June 30, 2009 ASSETS Cash and investments Accounts receivable Total assets LIABILITIES AND FUND BALANCES Liabilities: Accounts payable Contract retention payable Due to other funds Total liabilities Fund Balances: Reserved for: Recycling programs Public safety programs Street maintenance and construction Health and welfare programs Capital improvement projects Total fund balances Total liabilities and fund balances Special Revenue Funds Special Supplemental Criminal Vehicle Law Activity Abatement Enforcement Traffic Safety $ 39,775 $ 167,272 $ - $ 148,424 - - 41,346 9,242 $ 39,775 $ 167,272 $ 41,346 $ 157,666 $ - $ - $ - $ 54,080 - - 41,346 - - - 41,346 54,080 39,775 167,272 - 103,586 ,., ,,"~ - $ 39,775 $ 167,272 $ 41,346 $ 157,666 7R Special Revenue Funds Measure B Measure B Sales Tax Traffic Sales Tax Bike/ Congestion Measure D EMS State Gas Tax TEA-21 Local Streets Pedestrian Relief Recycling $ 116,833 $ 1,985,789 $ - $ 855,700 $ 461,100 $ 310,415 $ 325,476 43,667 62,324 46,884 96,106 16,060 96,572 55,624 $ 160,500 $ 2,048,113 $ 46,884 $ 951,806 $ 477,160 $ 406,987 $ 381,100 $ 89,489 $ 146,758 $ 5,393 $ 74,089 $ 32,374 $ - $ 97,174 - 4,426 - 7,910 - - - - - 41,491 - - - - 89,489 151,184 46,884 81,999 32,374 - 97,174 - - - - - - 283,926 71,011 - - - - _ _ - 1,896,929 - 869,807 - 406,987 - $ 160,500 $ 2,048,113 $ 46,884 $ 951,806 $ 477,160 $ 406,987 $ 381,100 (Continued) w 79 ~. City of Dublin Combining Balance Sheet ~' Non-Major Governmental Funds, Continued June 30, 2009 .~ a~ Special Revenue Funds ~' ASSETS Cash and investments Accounts receivable Total assets LIABILITIES AND FUND BALANCES Liabilities: Accounts payable Contract retention payable Due to other funds Total liabilities Fund Balances: Reserved for: Recycling programs Public safety programs Street maintenance and construction Health and welfare programs Capital improvement projects Total fund balances Total liabilities and fund balances East Bay Community Local Garbage Regional Development Recycling Service Park District Block Grant $ 557,091 $ - $ - $ - ~' - 29,757 33,800 5,182 ~ $ 557,091 $ 29,757 $ 33,800 $ 5,182 $ - $ 77 $ - $ 1,226 ~. - 9,622 33,800 3,956 ~r - 9,699 33,800 5,182 s - - - - ~> 557,091 20,058 - - - - ~ 557,091 20,058 - - $ 557,091 $ 29,757 $ 33,800 $ 5,182 wp , _ .~ ~, .~ .,~ Rn ~:,, iii of iga Special Revenue Funds Maintenance Districts Total 1983-1 1983-2 1986-1 1997-1 1999-1 Non-Major Street Stagecoach Dougherty Santa Rita East Dublin Governmental Lighting Landscape Landscape Landscape Street Lighting Funds $ 179,582 $ 55,637 $ 89,568 $ 193,884 $ 269,970 $ 5,756,516 3,606 467 256 714 3,266 544,873 $ 183,188 $ 56,104 $ 89,824 $ 194,598 $ 273,236 $ 6,301,389 $ 31,167 $ 29,783 $ 10,279 $ 34,311 $ 8,205 $ 614,405 - - - - - 12,336 - - - - - 130,215 283,926 381,644 152,021 26,321 79,545 160,287 265,031 3,856,928 - - - - - 577,149 - - - - - 444,786 152,021 26,321 79,545 160,287 265,031 5,544,433 $ 183,188 $ 56,104 $ 89,824 $ 194,598 $ 273,236 $ 6,301,389 (Concluded) 81 u~o~iaa - ~, City of Dublin Combining Statement of Revenues, Expenditures and Changes in Fund Balances "° Non-Major Governmental Funds '~ For the year ended June 30, 2009 REVENUES: Property taxes Taxes other than property Intergovernmental Charges for service Interest Fines and forfeitures Other revenue Special assessments Total revenues EXPENDITURES: Current: General Government Public safety Highways and streets Health and welfare Community development Capital outlay: Health and welfare Parks Streets Total expenditures REVENUES OVER (UNDER) EXPENDITURES OTHER FINANCING SOURCES (USES): Transfer in Transfer out Total other financing sources (uses) NET CHANGE IN FUND BALANCES FUND BALANCES: Begiruting of year End of year Special Revenue Funds Special Supplemental Criminal Vehicle Law ~ Activity Abatement Enforcement Traffic Safety $ - $ - $ - $ - - - - - - 29,059 100,000 - - - - - 1,428 5,705 382 5,857 1i - - - 175,517 6,504 - - - ~ 7,932 34,764 100,382 181,374 9,807 - 100,382 231,203 - - - - - - - - ~, - - - - w` 9,807 - 100,382 231,203 w (1,875) 34,764 - (49,829) •.. - (19,632) - - - (19,632) - - p. (1,875) 15,132 - (49,829) 41,650 152,140 - 153,415 $ 39,775 $ 167,272 $ - $ 103,586 ~. R2 Special Revenue Funds Measure B Measure B Traffic Sales Tax Bike and Congestion Measure D EMS State Gas Tax TEA 21 Transportation Pedestrian Relief Recycling $ 141,880 $ - $ - $ - $ - $ - $ - - - - 312,835 110,368 - - 166,575 830,777 166,692 - - 399,110 218,629 5,285 48,671 - 44,630 14,866 6,518 11,438 - - - 50,587 - - 20,057 313,740 879,448 166,692 408,052 125,234 405,628 250,124 372,964 24,706 - - - - 17,515 "x - 347,010 - - - - - - - - - - - 191,866 - 6,000 - - - - - - - - - - - 177,196 - 690,881 166,692 104,181 81,999 - - 372,964 1,068,597 166,692 104,181 81,999 - 386,577 (59,224) (189,149) - 303,871 43,235 405,628 (136,453) (59,224) (189,149) - 303,871 43,235 405,628 (136,453) 130,235 2,086,078 - 565,936 401,551 1,359 420,379 $ 71,011 $ 1,896,929 $ - $ 869,807 $ 444,786 $ 406,987 $ 283,926 (Continued) '~ 83 lI% ~ ~' 1 ga .~ City of Dublin Combining Statement of Revenues, Exp enditures and Changes in Fund Balances Non-Major Governmental Funds For the year ended June 30, 2009 .~ ~- Special Revenue Funds ~ East Bay Regional Community Garbage Local Park Development Service Recycling District Block Grant w- REVENUES: Property taxes $ - $ - $ - $ - ~ Taxes other than property - - - - Intergovernmental - - - 66,304 Charges for service 1,608,479 - - - Interest 6,098 18,925 33,800 - Fines and forfeitures - - - - Otherrevenue - - - - Special assessments - - - - Total revenues 1,614,577 18,925 33,800 66,304 EXPENDITURES: Current: ~:, General Government Public safety - - - - Highways and streets - - - - Health and welfare 1,571,636 - - 59,704 Community development - - - - Capital outlay: Health and welfare - - - - Parks - - 33,800 - Streets - - - - Total expenditures 1,571,636 - 33,800 59,704 REVENUES OVER ~` (UNDER) EXPENDITURES 42,941 18,925 - 6,600 OTHER FINANCING SOURCES (USES): ~, Transfer in - - - - Transfer out - - - (6,600) Total other financing sources (uses) - - - (6,600) NET CHANGE IN FUND BALANCES 42,941 18,925 - - .~ ~. FUND BALANCES: s Beginning of year (22,883) 538,166 - - End of year $ 20,058 $ 557,091 $ - $ - 84 '"~` Special Revenue Funds Maintenance Districts Total Dougherty Santa Rita Dublin Street Non-Major $ - $ - $ - $ - $ - $ 141,880 - - - - - 423,203 - - - - - 1,977,146 - - - - - 1,608,479 5,630 1,666 2,781 6,067 7,937 227,684 - - - - - 175,517 278,128 69,246 102,717 231,350 180,316 5,468,733 260,659 - - - - 1,017,236 - 85,823 88,579 229,972 103,780 855,164 - - - - - 1,823,206 4,229 2,685 2,699 2,737 3,740 22,090 - - - - - 210,996 - - - - - 1 043 753 264,888 88,508 91,278 232,709 107,520 4,972,445 13,240 (19,262) 11,439 (1,359) 72,796 496,288 - - - - - (26,232) °'~ - - - - - (26,232) 13,240 (19,262) 11,439 (1,359) 72,796 470,056 a 138,781 45,583 68,106 161,646 192,235 5,074,377 $ 152,021 $ 26,321 $ 79,545 $ 160,287 $ 265,031 $ 5,544,433 (Concluded) '* 85 r~ Q~= ~~a City of Dublin Schedule of Revenues, Expenditures and Changes in Fund Balances - Budget and Actual -Special Criminal Activity Special Revenue Fund For the year ended June 30, 2009 REVENUES: Interest Other revenue Total revenues EXPENDITURES: Current: Public safety Total expenditures Net change in fund balance FUND BALANCE: Beginning of year End of year Budgeted Amounts Original Final $ 1,074 $ 1,074 - 2,000 1,074 3,074 11,840 11,840 11,840 11,840 $ (10,766) $ (8,766) Variance with Final Budget - Actual Positive Amounts (Negative) 1,428 $ 354 6,504 4,504 7,932 4,858 9,807 2,033 9,807 2,033 (1,875) $ 6,891 41,650 RF, ~aa of Aga City of Dublin Schedule of Revenues, Expenditures and Changes in Fund Balances - y Budget and Actual -Vehicle Abatement Special Revenue Fund For the year ended June 30, 2009 Variance with Final Budget - Budgeted Amounts Actual Positive Original Final Amounts (Negative) REVENUES: Intergovernmental $ 30,000 $ 30,000 $ 29,059 $ (941) Interest 5,914 5,914 5,705 (209) Total revenues 35,914 35,914 34,764 (1,150) EXPENDITURES: Current: Public safety 100 Total expenditures 100 REVENUES OVER (UNDER) EXPENDITURES 35,814 OTHER FINANCING (USES): Transfers out Total other financing - Net change in fund balance $ 35,914 ~ 35,914 FUND BALANCE: Beginning of year End of year 35,914 34,764 (1,150) - 19,632 19,632 - 19,632 19,632 i5,isz ~ (zo,7sz) 152,140 $ 167,272 87 „~ ~~ g /~ ~~ ~ City of Dublin Schedule of Revenues, Expenditures and Changes in Fund Balances - Budget and Actual -Supplemental Law Enforcement Special Revenue Fund For the year ended June 30, 2009 REVENUES: Intergovernmental Interest Total revenues EXPENDITURES: Current: Public safety Total expenditures Net change in fund balance FUND BALANCE: Beginning of year End of year Budgeted Amounts Original Final Actual Amounts .~ Variance with ~" Final Budget - Positive (Negative) ~` r $ 100,000 $ 100,000 $ 100,000 $ - ~,, 8 8 382 374 ~. 100,008 100,008 100,382 374 100,000 100,382 100,382 s - 100,000 100,382 100,382 - ~ $ 8 $ (374) - $ 374 $ - irr wr R. 88 ~'" City of Dublin Schedule of Revenues, Expenditures and Changes in Fund Balances - Budget and Actual -Traffic Safety Special Revenue Fund For the year ended June 30, 2009 REVENUES: Interest Fines and forfeitures Other revenues Total revenues EXPENDITURES: Current: Public safety Total expenditures Net change in fund balance FUND BALANCE: Beginning of year End of year Budgeted Amounts Original Final $ 3,578 $ 3,578 197,000 197,000 Variance with Final Budget - Actual Positive Amounts (Negative) 5,857 $ 2,279 175,517 (21,483) 271,670 271,670 231,203 40,467 271,670 271,670 231,203 40,467 $ (71,092) $ (71,092) (49,829) $ 21,263 153,415 City of Dublin Schedule of Revenues, Expenditures and Changes in Fund Balances - Budget and Actual -EMS Special Revenue Fund For the year ended June 30, 2009 REVENUES: Property taxes Intergovernmental Interest Total revenues EXPENDITURES: Current: Public safety Total expenditures Net change in fund balance FUND BALANCE: Beginning of year End of year Variance with Final Budget - Budgeted Amounts Actual Positive Original Final Amounts (Negative) ° $ 134,025 $ 134,025 $ 141,880 $ 7,855 166,575 166,575 166,575 - 3,346 3,346 5,285 1,939 303,946 303,946 313,740 9,794 ~° 374,014 374,014 372,964 1,050 374,014 374,014 372,964 1,050 ~ $ (70,068) $ (70,068) (59,224) $ 10,844 130,235 $ 71,011 l~(a of /~ City of Dublin Schedule of Revenues, Expenditures and Ch~~ges in Fund Balances - Budget and Actual -State Gas Tax Special Revenue Fund For the year ended June 30, 2009 Budgeted Amounts REVENUES: Intergovernmental Interest Total revenues EXPENDITURES: Current: Public safety Highways and streets Community development Capital outlay: Streets Total expenditures OTHER FINANCING (USES): Transfers in Total other financing Net change in fund balance FUND BALANCE: Beginning of year End of year Original Final $ 812,900 $ 812,900 63,974 63,974 876,874 876,874 35,000 35,000 387,651 387,651 6,000 6,000 941,260 1,006,449 $ (493,037) $ (558,226) Variance with Final Budget - Actual Positive Amounts (Negative) 830,777 $ 17,877 48,671 (15,303) 879,448 2,574 24,706 10,294 347,010 40,641 6,000 - 1,068,597 366,503 (189,149) $ 369,077 2,086,078 $ 1,896,929 is 7 Q~ lea City of Dublin Schedule of Revenues, Expenditures and Changes in Fund Balances - Budget and Actual - T.E.A Special Revenue Fund For the year ended June 30, 2009 REVENUES: Intergovernmental Total revenues EXPENDITURES: Capital outlay: Streets Total expenditures Net change in fund balance FUND BALANCE: Beginning of year End of year Budgeted Amounts Original Final Variance with Final Budget - Actual Positive Amounts (Negative) 166,692 $ (1,217,900) 166,692 (1,217,900) $ 1,373,664 $ 1,384,592 $ 1,373,664 1,384,592 1,370,821 1,381,749 1,370,821 1,381,749 $ 2,843 $ 2,843 166,692 1,215,057 166,692 1,215,057 - $ (2,843) $ - 92 lad of i~a City of Dublin Schedule of Revenues, Expenditures and Changes in Fund Balances - Budget and Actual - Measure B Sales Tax Transportation Special Revenue Fund For the year ended June 30, 2009 REVENUES: Taxes other than property Interest Other revenue Total revenues EXPENDITURES: Capital outlay: Streets Total expenditures Net change in fund balance FUND BALANCE: Beginning of year End of year Variance with Final Budget - Budgeted Amounts Actual Positive Original Final Amounts (Negative) $ 329,727 $ 329,727 $ 312,835 $ (16,892) 11,765 11,765 44,630 32,865 - 53,713 50,587 (3,126) 341,492 395,205 408,052 12,847 715,370 759,083 104,181 654,902 715,370 759,083 104,181 654,902 $ (373,878) $ (363,878) 303,871 $ 667,749 565,936 93 /~ 1 ~ /ga City of Dublin Schedule of Revenues, Expenditures and Changes in Fund Balances - Budget and Actual - Measure B Bike and Pedestrian Special Revenue Fund For the year ended June 30, 2009 Variance with Final Budget - Budgeted Amounts Actual Positive Original Final Amounts (Negative) REVENUES: Taxes other than property $ 109,507 $ 109,507 $ 110,368 $ 861 Interest 15,559 15,559 14,866 (693) Total revenues 125,066 125,066 125,234 168 EXPENDITURES: Capital Outlay Highways and streets 96,763 154,965 81,999 72,966 Total expenditures 96,763 154,965 81,999. 72,966 Net change in fund balance $ 28,303 $ (29,899) 43,235 $ 73,134 FUND BALANCE: Beginning of year 401,551 End of year $ 444,786 94 City of Dublin Schedule of Revenues, Expenditures and Changes in Fund Balances - Budget and Actual -Traffic Congestion Relief Special Revenue Fund For the year ended June 30, 2009 ~~~ ~ ~ ~8a Variance with Final Budget - Budgeted Amounts Actual Positive Original Final Amounts (Negative) ~~ REVENUES: Intergovernmental $ 420,008 $ 420,008 $ 399,110 $ (20,898) Interest 8,892 8,892 6,518 (2,374) Total revenues 428,900 428,900 405,628 (23,272) EXPENDITURES: Capital Outlay Highways and streets - _ _ _ Total expenditures - _ _ _ Net change in fund balance $ 428,900 $ 428,900 ~~ 405,628 $ (23,272) FUND BALANCE: Beginning of year 1,359 End of year $ 406,987 95 l3/ 6~ lg~ .~ City of Dublin Schedule of Revenues, Expenditures and Changes in Fund Balances - Budget and Actual - Measure D Recycling Special Revenue Fund For the year ended June 30, 2009 Budgeted Amounts Actual Original Final Amounts REVENUES: Intergovernmental Interest Other revenue Total revenues EXPENDITURES: Current: General Governtment Highways and streets Health and welfare Capital outlay: Parks Total expenditures Net change in fund balance FUND BALANCE: Beginning of year End of year $ 213,946 $ 213,946 $ 218,629 $ 4,683 ~, 254 254 11,438 11,184 4,500 4,500 20,057 15,557 218,700 218,700 250,124 31,424 ~ - 18,000 17,515 - - 205,408 - 235,408 - 191,866 - 43,542 ~ 127,000 229,591 177,196 52,395 w 332,408 482,999 386,577 95,937 $ (113,708) $ (264,299) (136,453) $ 127,846 ~ 420,379 "~" $ 283,926 "~ wr r~ w ^. ~a ~.,, .~ .~a ..~ ~~ 96 `` .~ Variance with Final Budget - ~ Positive (Negative) • i3a ~ ~~~ City of Dublin Schedule of Revenues, Expenditures and Changes in Fund Balances - Budget and Actual -Local Recycling Program Special Revenue Fund For the year ended June 30, 2009 REVENUES: Interest Net change in fund balance FUND BALANCE: Beginning of year End of year Budgeted Amounts Original Final $ 19,931 $ 19,931 $ 19,931 $ 19,931 Variance with Final Budget - Actual Positive Amounts (Negative) 18,925 $ (1,006) 18,925 $ (1,006) 538,166 97 X33 ~ ~~a City of Dublin Schedule of Revenues, Expenditures and Changes in Fund Balances - Budget and Actual -Garbage Service Special Revenue Fund For the year ended June 30, 2009 REVENUES: Charges for services Interest Total revenues Variance with Final Budget - Budgeted Amounts Actual Positive Original Final Amounts (Negative) $ 1,615,400 $ 1,615,400 1,615,400 $ 1,608,479 $ (6,921) - 6,098 6,098 EXPENDITURES: Current: Health and welfare Total expenditures Net change in fund balance FUND BALANCE: Beginning of year End of year 1,615,400 1,614,577 1,591,293 1,591,293 1,591,293 1,591,293 $ 24,107 $ 24,107 1,571,636 (823) 19,657 1,571,636 19,657 42,941 $ 18,834 (22,883) $ 20,058 98 /~ ~ /g~ City of Dublin Schedule of Revenues, Expenditures and Chari~es in Fund Balances - Budget and Actual -East Bay Regional Park District Special Revenue Fund For the year ended June 30, 2009 Variance with Final Budget - Budgeted Amounts Actual Positive Original Final Amounts (Negative) REVENUES: Interest $ - $ - $ 33,800 $ 33,800 Net change in fund balance $ - $ - 33,800 $ 33,800 EXPENDITURES: Capital Outlay: Parks - - 33,800 (33,800) Total expenditures - - 33,800 (33,800) Net change in fund balance $ _ $ _ _ $ _ FUND BALANCE: Beginning of year _ End of year $ _ 99 l35 ~ 1 S~ City of Dublin Schedule of Revenues, Expenditures and Changes in Fund Balances - Budget and Actual - CDBG Special Revenue Fund For the year ended June 30, 2009 REVENUES: Intergovernmental Total revenues EXPENDITURES: Current: Health and welfare Total expenditures REVENUES OVER (UNDER) EXPENDITURES OTHER FINANCING (USES): Transfers out Total other financing (uses) Net change in fund balance FUND BALANCE: Beginning of year End of year Variance with Final Budget - Budgeted Amounts Actual Positive Original Final Amounts (Negative) 66,308 $ 66,308 $ 66,304 $ (4) 66,308 66,308 66,304 (4) 59,708 59,708 59,704 4 59,708 59,708 59,704 4 6,600 6,600 6,600 - - - (6,600) (6,600) - - (6,600) (6,600) $ 6,600 $ 6,600 - $ (6,600) $ - 100 /~/, of /~~ City of Dublin Schedule of Revenues, Expenditures and Changes in Fund Balances - Budget and Actual -Street Lighting Special Revenue Fund For the year ended June 30, 2009 REVENUES: Interest Other revenue Special assessments Total revenues EXPENDITURES: Current: Public safety Community development Total expenditures Net change in fund balance FUND BALANCE: Beginning of year End of year Budgeted Amounts Original Final $ 5,596 $ 5,596 $ 5,000 5,000 259,914 259,914 Variance with Final Budget - nal Positive punts (Negative) 5,630 $ 34 10,094 5,094 278,128 7,618 253,569 260,618 260,659 (41) 4,270 4,270 4,229 41 257,839 264,888 264,888 - $ 12,671 $ 5,622 13,240 $ 7,618 138,781 101 City of Dublin Schedule of Revenues, Expenditures and Changes in Fund Balances - Budget and Actual -Stagecoach Landscape Special Revenue Fund For the year ended June 30, 2009 REVENUES: Interest Special assessments Total revenues EXPENDITURES: Current: Highways and streets Community development Total expenditures Net change in fund balance FUND BALANCE: Beginning of year End of year Budgeted Amounts Original Final $ 1,483 $ - $ 68,073 68,073 69,556 68,073 Variance with Final Budget - Actual Positive Amounts (Negative) 1,666 $ 1,666 67,580 (493) 69,246 1,173 83,144 86,429 85,823 606 2,705 2,705 2,685 20 85,849 89,134 88,508 $ (16,293) $ (21,061) (19,262) $ 45,583 $ 26,321 626 1,799 102 l3~ ~ ~ /Sa City of Dublin Schedule of Revenues, Expenditures and Changes in Fund Balances - Budget and Actual -Dougherty Landscape and Lighting Special Revenue Fund For the year ended June 30, 2009 REVENUES: Interest Special assessments Total revenues EXPENDITURES: Current: Highways and streets Community development Total expenditures Net change in fund balance FUND BALANCE: J Beginning of year End of year Variance with Final Budget - Budgeted Amounts Actual Positive Original Final Amounts (Negative) $ 2,614 $ 2,614 $ 2,781 $ 167 99,582 99,582 99,936 354 105,489 105,489 2,705 2,705 108,194 108,194 $ (5,998) $ (5,998) 88,579 16,910 11,439 $ 17,437 68,106 $ 79,545 103 l39 ~ ~~~ City of Dublin Schedule of Revenues, Expenditures and Changes in Fund Balances - Budget and Actual -Santa Rita Assessment District 97-1 Special Revenue Fund For the year ended June 30, 2009 Variance with Final Budget - Budgeted Amounts Actual Positive Original Final Amounts (Negative) REVENUES: Interest $ 5,218 $ 5,218 $ 6,067 $ 849 Special assessments 246,273 246,273 225,283 (20,990) Total revenues 251,491 251,491 231,350 (20,141) EXPENDITURES: Current: Highways and streets 262,766 262,734 229,972 32,762 Community development 2,705 2,737 2,737 - Tota1 expenditures 265,471 265,471 232,709 32,762 Net change in fund balance $ (13,980) $ (13,980) (1,359) $ 12,621 FUND BALANCE: Beginning of year 161,646 End of year $ 160,287 104 iyo of i~a City of Dublin Schedule of Revenues, Expenditures and Changes in Fund Balances - Budget and Actual -East Dublin Street Lighting Assessment Special Revenue Fund For the year ended June 30, 2009 REVENUES: Interest Other revenue Special assessments Total revenues EXPENDITURES: Current: ~, Public Safety Community development m Total expenditures Net change in fund balance FUND BALANCE: Beginning of year End of year Variance with Final Budget - Budgeted Amounts Actual Positive Original Final Amounts (Negative) $ 8,020 $ 8,020 $ 7,937 $ (83) - - 865 865 166,165 166,165 180,316 109.391 109.391 $ 53,024 $ 53,024 103.780 107,520 14,151 5,611 5,621 192,235 105 City of Dublin Schedule of Revenues, Expenditures and Changes in Fund Balances - ~" Budget and Actual -Alameda County Congestion Management Agency Special Revenue Fund ~ For the year ended June 30, 2009 Variance with ~" Final Budget - Budgeted Amounts Actual Positive Original Final Amounts (Negative) '~" REVENUES: Property taxes $ - $ - $ - $ - ~ Intergovernmental 133,000 133,000 - (133,000) Interest - - - - Total revenues 133,000 133,000 - (133,000) ~° t EXPENDITURES: Current: Highways and streets 133,000 133,000 - 133,000 Total expenditures 133,000 133,000 - 133,000 ~, Net change in fund balance $ - $ - - $ - ~. FUND BALANCE: Beginning of year - End of year $ - ~, ,~; <.. .~ inti / fd a~ /8~ City of Dublin Schedule of Revenues, Expenditures and Changes in Fund Balances - Budget and Actual -Highway Safety Traffic Reduction Bond (Prop 1B) For the year ended June 30, 2009 Variance with Final Budget - Budgeted Amounts Actual Positive Original Final Amounts (Negative) REVENUES: Interest $ 65 $ 65 $ - $ (65) Intergovernmental - - - - Total revenues 65 65 - (65) EXPENDITURES: Capital Outlay Highways and streets - - - - Total expenditures - - - - Net change in fund balance $ 65 $ 65 - $ (65) FUND BALANCE: Beginning of year - End of year $ - ~r "~ 107 ~. ~~ This page intentionally left blank. .~ 108 '"" INTERNAL SERVICE FUNDS Internal Service Funds are used to account for the financing of goods or services provided by one department or agency to other departments or agencies of the City on a cost reimbursement basis. The City has established five of these types of funds: Equipment Replacement, Fire Equipment and Station Replacement, Building Replacement, Retiree Health Care and PERS Side Fund. ~" 109 )y5 ~ ~~~ City of Dublin Combining Statement of Net Assets Internal Service Funds June 30, 2009 Fire Equipment Equipment and Station Building Retiree PERS Replacement Replacement Replacement Health Care Side Fund Total ASSETS Current assets: Cash and investments $ 3,333,176 $ 2,272,122 $ 1,878,047 $ 9,994 $ - $ 7,493,339 Receivables: Accounts 3,766 - - - - 3,766 Prepaid items 664 - 664 Total current assets 3,337,606 2,272,122 1,878,047 9,994 7,497,769 Noncurrent assets: OPEB - - - 516,515 - 516,515 Land - - 10,774,792 - - 10,774,792 Construction in progress - - 143,365 - - 143,365 Buildings and improvements - - 62,081,624 - - 62,081,624 Machinery and equipment 2,413,186 3,027,205 461,552 - - 5,901,943 Less: accumulated depreciation (1,926,500) (1,936,350) (16,857,928) (20,720,778) Total noncurrent assets 486,686 1,090,855 56,603,405 516,515 58,697,461 Total assets 3,824,292 3,362,977 58,481,452 526,509 66,195,230 LIABILITIES Current liabilities: Accounts payable 15,134 - - - - 15,134 Total current liabilities 15,134 15,134 Noncurrent liabilities: Advances from other funds - - - - 2,945,495 2,945,495 OPEB Obligation - - - - - - Total noncurrent liabilities 2,945,495 2,945,495 Total liabilities 15,134 2,945,495 2,960,629 NET ASSETS Invested in capital assets 486,686 1,090,855 56,603,405 516,515 - 58,697,461 Unrestricted 3,322,472 2,272,122 1,878,047 9,994 (2,945,495) 4,537,140 Total net assets $ 3,809,158 $ 3,362,977 $ 58,481,452 $ 526,509 $ (2,945,495) $ 63,234,601 11~ ~~~ o -~ l8a City of Dublin Combining Statement of Revenues, Expenses and Changes in Net Assets Internal Service Funds For the year ended June 30, 2009 Fire Equipment Equipment and Station Building Retiree PERS Replacement Replacement Replacement Health Care Side Fund Total OPERATING REVENUES: Charges for services $ 756,163 $ 218,585 $ 126,539 $ 418,576 $ 318,578 $ 1,838,441 Other revenue 103,195 280,704 383,899 Total operating revenues 859,358 218,585 126,539 699,280 318,578 2,222,340 OPERATING EXPENSES: Supplies and services 482,347 - 8,513 - - 490,860 PERS retirement - - - - - - OPEB expenses - - - 511,000 - 511,000 Depreciation 257,742 181,747 1,744,910 - - 2,184,399 Total operating expenses 740,089 181,747 1,753,423 511,000 - 3,186,259 Operating income (loss) 119,269 36,838 (1,626,884) 188,280 318,578 (963,919) NONOPERATING REVENUES: Interest income 110,879 73,722 68,086 2,323 255,010 Total NON operating revenues 110,879 73,722 68,086 2,323 - 255,010 NONOPERATING EXPENSES: Capital assets purchases - - - - - - Total NON operating expenses - - - - - - Non operating income (loss) 110,879 73,722 68,086 2,323 - 255,010 Contribution of capital assets - - 8,394,764 - - 8,394,764 Change in net assets 230,148 110,560 6,835,966 190,603 318,578 7,685,855 NET ASSETS: Beginning of year, as restated 3,579,010 3,252,417 51,645,486 335,906 (3,264,073) 55,548,746 End of year $ 3,809,158 $ 3,362,977 $ 58,481,452 $ 526,509 $ (2,945,495) $ 63,234,601 111 ~~~ o~ Aga City of Dublin Combining Statement of Cash Flows Internal Service Funds For the year ended June 30, 2009 Fire Equipment Equipment and Station Building Retiree PERS Replacement Replacement Replacement Health Care Side Fund Total CASH FLOWS FROM OPERATING ACTIVITIES: Receipts from customers Payments to suppliers and service providers Other Net cash provided (used) by operating activities CASH FLOWS FROM NONCAPITAL FINANCING ACTIVITIES Payments on advances from other funds Net cash provided (used) for noncapital financing activities CASH FLOWS FROM CAPITAL AND RELATED FINANCING ACTIVITIES: Capital assets Net cash provided (used) for capital and related financing activities CASH FLOWS FROM INVESTING ACTIVITIES: Interest received Net cash provided (used) for investing activities Net increase(decrease)in cash and cash equivalents CASH AND EQUIVALENTS: Beginning of year End of year RECONCILIATION OF OPERATING INCOME (LOSS) TO NET CASH PROVIDED BY OPERATING ACTIVITIES: Operating income (loss) Adjustments to reconcile operating income (loss) to cash flows from operating activities: Depreciation Net effect of changes in: Accounts receivable Prepaid items Accounts payable OPEB Obligation Net cash provided (used) by operating activities $ 764,019 $ 218,585 $ 126,539 $ 418,576 $ 318,578 $ 1,846,297 (473,321) 1,544 (8,513) (816,097) - (1,296,387) 103,195 - 280,704 383,899 393,893 220,129 118,026 (116,817) 318,578 933,809 - - - (318,578) (318,578) - - - (318,578) (318,578) (316,675) - (366,329) (683,004) (316,675) - (366,329) (683,004) 110,879 73,722 68,086 2,323 255,010 110,879 73,722 68,086 2,323 255,010 188,097 293,851 (180,217) (114,494) 187,237 3,145,079 1,978,271 2,058,264 124,488 7,306,102 $ 3,333,176 $ 2,272,122 $ 1,878,047 $ 9,994 $ $ 7,493,339 $ 119,269 $ 36,838 $ (1,626,884) $ 188,280 $ 318,578 $ (963,919) 257,742 181,747 1,744,910 7,856 - - (644) - - 9,670 1,544 - - - 2,184,399 - - 7,856 - - (644) - - 11,214 (305,097) - (305,097) $ 393,893 $ 220,129 $ 118,026 $ (116,817) $ 318,578 $ 933,809 112 AGENCY FUND Agency Funds are used to account for assets held by the City in a fiduciary capacity for individuals, governmental entities and others. These funds carry out the specifications of trust indentures, ordinance or other regulations. Dublin Boulevard Extension Assessment District Fund - To account for the special assessment established to fund the improvements to Dublin Boulevard. Geologic Hazard Abatement Districts -Two districts were formed under provisions in the California Public Resource Code, which establishes in section 25670 that a District is a politital subdivision of the State and is not an agency or instrumentality of a local agency. The City acts as a trustee of the funds collected and may contractually provide or arrange for services paid for by the District. Fiscal Year 2008- 2009 was the first year that tax roll assessments were levied by the Districts. Fallon Village Geologic Hazard Abatement District -This assessment district was established in 2007, in accordance with a condition of approval for the Fallon Village development project. The District was formed to provide a mechanism for ongoing maintenance of open space areas within the development. The boundary of this assessment district encompasses approximately 175 acres of land, located generally east of Fallon Road. Fallon Village Geologic Hazard Abatement District -This assessment district was established in 2006, in accordance with a condition of approval for the Schaefer Ranch development project. The District was formed to provide a mechanism for ongoing maintenance of open space areas within the development. The boundary of this assessment district encompassess approximately 500 acres of land, located at the westerly boundery of the City limits north of Interstate 580, and south of the unincorporated area of Alameda County. 113 ~y9 ~f ~aa City of Dublin Statement of Changes in Net Assets Agency Fund For the fiscal year ended June 30, 2009 Balance Balance July 1, 2008 Additions Deletions June 30, 2009 Dublin Boulevard Extension Assessment District Assets: Cash and investments $ 196,883 $ 233,586 $ (235,242) $ 195,227 Restricted cash and investments 329,286 2,124 (151,000) 180,410 Interest Receivable 378 - (378) - Totalassets $ 526,547 $ 235,710 $ (386,620) $ 375,637 Liabilities: Due to bondholders $ 526,547 $ 235,710 $ (386,620) $ 375,637 Total liabilities $ 526,547 $ 235,710 $ (386,620) $ 375,637 Fallon Village Geological Hazardous Abatement District Assets: Cash and investments $ - $ 14,199 $ - $ 14,199 Total assets $ - $ 14,199 $ - $ 14,199 Liabilities: Due to trustee $ - $ 14,199 $ - $ 14,199 Total liabilities $ - $ 14,199 $ - $ 14,199 Schaefer Ranch Geological Hazardous Abatement District Assets: Cash and investments $ - $ 11,467 $ - $ 11,467 Interest Receivable - 281 - 281 Total assets $ - $ 11,748 $ - $ 11,748 Liabilities: Due to trustee - 11,748 - 11,748 Total liabilities $ - $ 11,748 $ - $ 11,748 114 im of i~a STATISTICAL SECTION (Unaudited) This part of the City of Dublin's comprehensive annual financial report presents detailed information as a context for understanding what the information in the financial statements, note disclosures and required supplementary information says about the government's overall financial health. Contents Financial Trends These schedules contain trend information to help the reader understand how the government's financial performance and well being have changed over time. Revenue Capacity These schedules contain information to help the reader assess the government's most significant local revenue source, the property tax. Debt Capacity These schedules present information to help the reader assess the affordability of the government's current levels of outstanding debt and the government's ability to issue additional debt in the future. Demographic and Economic Information These schedules offer demographic and economic indicators to help the reader understand the environment within which the government's financial activities take place. Operating Information These schedules contain service and infrastructure data to help the reader understand how the information in the government's financial report relates to the services the government provides and the activities it performs. 115 /.~y~ ~ ~~ / ~~ City of Dublin General Governmental Activities Tax Revenues by Source and Governmental Activities Tax Revenues by Source Last Ten Fiscal Years Fiscal Year Property Transient Ended Property Sales Franchise Transfer Occupancy June 30 Tax Tax Tax Tax Tax Total 2000 $ 5,991,814 $ 11,741,563 $ 963,070 $ 370,946 $ 808,688 $ 19,876,081 2001 7,174,290 13,204,429 1,313,087 575,282 1,010,799 23,277,887 2002 8,885,812 13,093,676 1,385,816 434,832 810,220 24,610,356 2003 10,142,650 13,573,607 1,394,953 379,089 717,083 26,207,382 2004 11,422,308 14,297,705 1,505,435 571,361 664,309 28,461,118 2005 14,167,079 14,517,465 1,559,900 831,003 663,632 31,739,079 2006 16,891,670 14,807,059 1,789,356 690,404 727,612 34,906,101 2007 20,266,216 14,458,912 2,111,281 596,533 800,773 38,233,715 2008 22,229,039 14,684,091 2,221,930 493,175 789,396 40,417,631 2009 23,306,302 12,424,541 2,180,846 254,022 577,057 38,742,768 Source: City of Dublin Finance Department Notes: The City experienced a dramatic decline in Transien t Occupancy Taxes following the September 11, 2001 national tragedy and the down turn that occurred in the San Francisco Bay Area economy that occurred during 2001-2005. The City has experienced significant growth in most other types of taxes due to significant residential and com mercial growth that has occurred during the last few years. 116 Asa a~~ /~~ City of Dublin Net Assets by Component Last Eight Fiscal Years (accrual basis of aceounting) Fiscal Year Governmental activities: Invested in capital assets, net ofrelated debt Restricted Unrestricted Total governmental activities net assets, as restated 2002 2003 2004 2005 2006 2007 2008 2009 $ 42,960,899 $ 61,016,642 $ 80,050,710 $ 383,667,187 $ 387,888,143 $ 399,631,407 $ 411,619,677 $ 423,474,384 43,339,073 34,110,132 37,455,125 45,288,468 48,480,463 45,647,928 48,572,719 36,906,687 45,579,288 50,413,267 50,943,803 52,176,440 57,766,785 61,789,687 68,456,077 66,597,197 $ 131,879,260 $ 145,540,041 $ 168,449,638 $ 481,132,095 $ 494,135,391 $ 507,069,022 $ 528,648,467 $ 526,978,268 Source: City of Dublin Finance Department Notes: The City of Dublin implemented GASB34 for the fiscal year ended June 30, 2002. Information prior to the implementation of GASB34 is not available. The significant increase in Capital Assetr in Fiscal Year 2004-2005 is due to a retroactive valuation recorded for the City's existing infrastructure in accordance with GASB 34. 117 ~s3 ~ ~8a City of Dublin Changes in Net Assets Last Eight Fiscal Years (accrual basis of accounting) Fiscal Year 2002 2003 2004 2005 2006 2007 2008 2009 Expenses: Governmental activities: General government $ 4,658,653 $ 6,135,344 $ 6,288,645 $ 3,081,581 $ 4,940,586 $ 8,866,758 $ 7,790,286 $ 8,721,545 Public safety 12,449,573 14,026,216 17,135,716 19,047,262 20,314,535 22,306,240 23,282,634 23,880,635 Highways and streets 5,277,778 15,187,872 939,260 19,810,590 13,894,865 17,182,208 20,196,496 20,368,655 Health and welfare 1,193,542 1,349,228 3,755,564 1,722,224 1,887,417 1,816,800 1,689,353 1,869,428 Culture and leisure services 3,901,126 4,730,430 1,603,494 8,954,495 10,074,239 14,080,040 12,200,759 11,563,136 Community development 4,557,634 5,334,646 6,113,171 7,210,558 8,553,887 11,157,417 8,276,993 7,175,272 Total governmental activities expenses 32,038,306 46,763,736 35,835,850 59,826,710 59,665,529 75,409,463 73,436,521 73,578,671 Program revenues: Governmental activities: Charges for services: General government 202,732 202,330 2,603 5,198 4,011 208,247 216,334 215,711 Public safety 913,612 1,073,145 851,864 1,197,925 1,270,233 2,284,955 1,301,328 1,545,935 Highways and streets 28,021 25,609 2,321,473 2,451,377 2,167,740 745,727 13,794 598,542 Health and welfare 978,499 1,033,317 1,558,930 1,541,361 2,092,566 2,483,619 3,301,877 3,050,719 Culture and leisure services 848,701 1,009,572 1,252,866 1,617,013 1,751,965 1,508,752 1,722,627 1,719,501 Community development 4,803,099 5,182,361 6,135,027 6,969,366 6,629,383 9,432,854 5,599,417 4,720,221 Operating grants and contributions 1,503,109 1,824,388 239,094 169,906 238,053 2,813,079 2,747,497 2,245,945 Capital grants and contributions 23,150,710 19,424,093 15,364,732 42,585,906 18,900,426 25,973,730 37,393,930 14,599,068 Total governmental activities program revenues 32,428,483 29,774,815 27,726,589 56,538,052 33,054,377 45,450,963 52,296,804 28,695,642 Net revenues (expenses): $ 390,177 $ (16,988,921) $ (8,109,261) $ (3,288,658) $ (26,611,152) $ (29,958,500) $ (21,139,717) $ (44,883,029) General revenues and other changes in net assets: Governmental activitres: Taxes: Property taxes 9,447,544 10,783,414 11,422,308 14,167,079 16,891,670 20,266,216 22,229,039 23,311,587 Sales tax 12,813,111 13,193,407 13,940,263 14,152,987 14,363,863 14,025,869 14,225,661 12,832,417 Other taxes 2,630,868 2,491,125 2,865,226 3,181,939 3,343,943 3,508,587 3,504,501 2,180,846 Motor vehicle tax, unrestricted 1,940,341 2,072,440 1,682,152 413,075 856,766 261,276 197,245 160,242 Investment income, unrestricted 2,127,156 1,710,903 799,008 2,704,647 2,505,911 4,053,187 4,399,908 4,266,601 Other general revenues 511,652 398,413 309,901 199,233 280,386 1,109,734 1,202,074 461,137 Transfers Total governmental activities 29,470,672 30,649,702 31,018,858 34,818,960 38,242,539 43,224,869 45,758,428 43,212,830 Changes in net assets $ 29,860,549 $ 13,660,781 $ 22,909,597 $ 31,530,302 $ 11,631,387 $ 13,266,369 $ 24,618,711 $ (1,670,199) Source: City of Dublin Finance Department Notes: The City of Dublin implemented GASB34 for the fiscal year ended June 30, 2002. Information prior to the implementation of GASB34 is no[ available. w 11R ~sya~ ~g~ This page intentionally left blank. 11A i.~so~ lA~ City of Dublin Fund Balances of Governmental Funds Last Ten Fiscal Years (modified accrual. basis of accounting) Fiscal Year General Fund Reserved Unreserved, designated for: Economic Stability Capital improvements Affordable Housing Compensated Absences Fire Retiree Medical Investment Market Value Adjustment Operation Carryover Emergency Communication System Authorized expenditures Unreserved, undesignated Total general fund All Other Governmental Funds Reserved Unreserved, designated, reported in: Special revenue funds Capital projects funds Undesignated Total all other governmental funds Total All Govemmental Funds, as Restated 2000 2001 2002 2003 $ 73,144 $ 65,175 $ 75,221 $ 529,811 1,369,133 1,369,133 1,369,133 1,651,965 2,449,955 10,496,927 9,710,107 8,089,385 - - 626,360 - 21,019,752 22,858,588 27,545,240 33,665,113 $ 24,911,984 $ 34,789,823 $ 39,326,061 $ 43,936,274 $ 23,366,124 $ 30,722,073 $ 43,279,073 $ 34,665,390 (4,142) - - (1,075,338) $ 23,361,982 $ 30,722,073 $ 43,279,073 $ 33,590,052 $ 48,273,966 $ 65,511,896 $ 82,605,134 $ 77,526,326 Source: City of Dublin Finance Department Note: All Other Governmental Funds includes the City's Major and Non Major Capital Project and Special Revenue Funds, excluding General Fund. w ~: ~~n Fiscal Year 2004 2005 2006 2007 2008 2009 $ 1,896,575 $ 2,275,433 $ 2,080,678 $ 5,741,942 $ 5,623,014 $ 5,343,610 2,719,008 2,970,721 2,970,720 2,970,722 2,970,722 5,868,847 6,400,290 6,572,591 5,985,440 4,258,539 8,884,334 11,049,175 1,000,000 1,000,000 1,000,000 1,000,000 1,000,000 1,000,000 - - - - 744,041 791,582 - - - - 500,000 750,000 - - - - 1,508,906 2,334,061 " - - - - 301,874 " - - - - 210,000 32,581,785 32,971,221 38,860,039 44,328,550 42,181,292 34,474,209 $ 44,597,658 $ 45,789,966 $ 50,896,877 $ 58,299,753 $ 63,412,309 $ 62,123,358 $ 37,395,125 $ 44,948,468 $ 48,140,467 $ 43,485,046 $ 47,322,720 $ 34,570,414 (1,810,979) (2,202,289) (1,893,598) (1,791,762) (1,837,021) (1,841,336) $ 35,584,146 $ 42,746,179 $ 46,246,869 $ 41,693,284 $ 45,485,699 $ 32,729,078 $ 80,181,804 $ 88,536,145 $ 97,143,746 $ 99,993,037 $ 108,898,008 $ 94,852,436 171 City of Dublin Changes in Fund Balances of Governmental Funds Last Ten Fiscal Years (modified accrual basis of accounting) Fiscal Year 2000 2001 2002 2003 Revenues: Property taxes Taxes other than property Intergovernrnental Licenses and permits Charges for services Investment income Use of property Fines and forfeitures Developer fees Special assessments Other revenues Total revenues Expenditures Current: General government Public safety Highways and streets Health and welfare Culture and leisure services Community development Capital outlay: General Health and welfare Community improvements Parks Streets Debt service: Principal Total expenditures Excess (deficiency of revenues over (under) expenditures Other financing sources (uses): Transfers in Transfers out Total other financing sources (uses) Net change in fund balances Debt service as a percentage of noncapital expenditures $ 5,991,816 $ 7,174,290 $ 8,885,812 $ 10,142,650 13,962,982 16,185,183 15,650,789 16,064,732 3,056,557 4,129,090 4,702,126 11,412,577 3,897,965 3,028,655 2,327,251 2,421,885 4,041,472 4,486,440 5,330,051 5,680,902 1,375,317 2,725,077 3,743,415 2,709,459 85,831 114,614 85,937 139,019 197,914 242,363 267,214 274,284 10,337,149 8,882,375 19,685,682 10,195,565 318,355 384,649 431,564 501,424 767,795 2,736,852 526,716 672,895 44,033,153 50,089,588 61,636,557 60,215,392 2,274,914 3,085,725 3,929,919 4,363,241 9,892,983 10,960,752 12,523,197 13,948,110 1,504,050 1,445,943 1,546,347 1,850,944 893,254 1,139,399 1,196,457 1,352,083 2,827,621 3,332,421 4,012,730 4,611,564 4,138,916 4,572,981 4,678,311 5,399,648 3,171,380 1,367,829 8,900,230 12,574,726 297,468 1,477,404 353,534 478,309 6,537,813 182,710 226,440 2,370,369 3,045,354 9,099,539 6,925,150 18,345,206 251,004 251,004 251,004 - 34,834,757 36,915,707 44,543,319 65,294,200 9,198,396 13,173,881 17,093,238 (5,078,808) 17,869 16,202 16,785 18,580 (949,510) (2,416,202) (16,785) (18,580) (931,641) (2,400,000) - - $ 8,266,755 $ 10,773,881 $ 17,093,238 $ (5,078,808) 1.2% 1.0% 0.9% 0.0% Source: City of Dublin Finance Department 177 /~"~' Q f /~"~ Fiscal Year 2004 2005 2006 2007 2008 2009 $ 11,422,308 $ 14,167,079 $ 16,891,670 $ 20,266,213 $ 22,229,039 $ 23,306,302 17,038,810 17,572,000 18,014,431 17,967,499 18,188,593 15,436,466 4,942,167 3,312,079 2,593,336 2,845,936 3,431,314 2,393,153 3,090,992 3,520,141 3,142,223 2,572,069 1,784,644 1,623,029 5,789,970 6,623,303 7,090,105 9,476,984 8,101,935 7,759,628 857,734 2,948,612 2,859,433 5,840,949 6,101,736 5,597,303 130,741 125,835 123,154 203,240 335,151 989,081 272,153 292,658 340,336 342,098 360,496 318,737 13,455,274 14,361,337 17,018,274 8,618,271 18,226,041 1,875,841 593,201 744,100 645,230 716,144 797,520 826,717 1,152,096 954,949 826,715 960,534 2,497,249 3,312,774 58,745,446 64,622,093 69,544,907 69,809,937 82,053,718 63,439,031 6,193,881 6,535,408 4,983,006 5,619,088 5,590,247 6,047,115 17,222,501 19,163,929 20,542,375 22,148,312 23,629,954 23,951,223 2,072,806 2,272,310 2,536,127 2,726,599 2,719,532 3,168,513 3,762,260 1,734,787 1,906,950 1,626,197 1,706,918 1,888,631 5,098,102 5,377,134 5,948,563 6,874,596 7,207,896 7,621,663 6,363,727 7,404,619 8,199,933 8,173,711 8,335,105 7,364,651 2,170,910 1,250,772 666,160 377,026 411,293 4,221,956 - - - 75,526 - - 734,113 462,751 838,618 95,672 218,058 68,236 5,425,790 9,237,426 10,189,487 10,711,807 8,820,229 9,409,692 7,045,878 2,828,616 7,102,450 5,532,110 11,042,816 13,742,919 56,089,968 56,267,752 62,913,669 63,960,644 69,682,048 77,484,599 2,655,478 8,354,341 6,631,238 5,849,293 12,371,670 (14,045,568) 21,905 1,336,275 21,789 90,399 77,528 26,232 (21,905) (1,336,275) (21,789) (90,399) (77,528) (26,232) $ 2,655,478 $ 8,354,341 $ 6,631,238 $ 5,849,293 $ 12,371,670 $ (14,045,568) 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 123 I59~~lS~i ~. City of Dublin Assessed Value and Estimated Actual Value of Taxable Property Last Ten Fiscal Years Fiscal City Wide Year Taxable Avg Total Ended Residential Commercial Industrial Unsecured / Less: Assessed Direct Tax June 30 Property Property Property Other Property Exemptions Value Rate 2000 $ 1,497,994,724 $ 332,044,309 $ 161,558,266 $ 394,432,584 $ (66,691,923) $ 2,319,337,960 0.2447% 2001 1,852,468,604 439,284,508 178,875,023 595,033,189 (60,674,335) 3,004,986,989 0.2416% 2002 2,437,438,709 653,528,807 141,438,754 556,968,264 (64,396,816) 3,724,977,718 0.2398% 2003 2,825,719,751 877,069,998 140,636,627 534,477,740 (69,498,931) 4,308,405,185 0.2398% 2004 3,233,586,490 998,908,661 147,997,335 561,725,805 (70,891,008) 4,871,327,283 0.2397% 2005 3,730,424,115 1,032,552,391 154,758,385 662,659,500 (72,612,237) 5,507,782,154 0.2397% 2006 4,520,222,157 1,052,701,438 162,182,398 652,279,788 (77,085,570) 6,310,300,211 0.2390% 2007 5,345,937,692 1,068,813,294 161,909,866 873,737,282 (80,274,178) 7,370,123,956 0.2387% 2008 5,870,526,565 1,112,837,055 171,673,012 1,072,734,321 (78,188,899) 8,149,582,054 0.2385% 2009 6,203,330,781 1,241,301,664 198,082,746 1,032,449,487 (36,478,516) 8,638,686,162 0.2385% Source: Alameda County Office of the Auditor-Controller Notes: t 1 ~ 1) In 1978 the voters of the State of California passed Proposition 13 which limited property taxes to a total maximum rate of 1 % "~ based upon the assessed value of the property being assessed. Each year, the assessed value of property may be increased by an "inflation factor" (limited to a maximum increase of 2%). With few exceptions, property is only reassessed at the time that it is sold to a new owner. At that point, the new assessed value is reassessed at the purchase price of the property sold. 2) The assessed valuation data shown above represents the only data currently available with respect to the actual market value of taxable property. ~ 3) The City-wide Direct Tax Rate is an average, the actual tax rate for each property varies according to its tax rate area. This average tax rate is net of State Shifts of local property tax revenue to Education and net of admin fees. 174 ~ a City of Dublin Direct and Overlapping Property Tax Rates °~ (Rate per $100 of assessed value) Last Ten Fiscal Years 1999 00 2000 O1 2001 02 2002 03 2003 04 2004 O5 2005 06 2006 07 2007 08 2008 09 Basic Levy (1) 1.00000 1.00000 1.00000 1.00000 1.00000 1.00000 1.00000 1.00000 1.00000 1.00000 Bay Area Rapid Transit 0.00000 0.00000 0.00000 0.00000 0.00000 0.00000 0.00480 0.00500 0.00760 0.00900 Castro Valley Unified School Bonds 0.03390 0.01990 0.03550 0.04980 0.05610 0.05320 0.07180 0.08110 0.09720 0.09690 Chabot -Las Positas College Bonds 0.00000 0.00000 0.00000 0.00000 0.00000 0.01860 0.01580 0.01590 0.01640 0.01830 Dublin Unified Bonds lA & B 0.07190 0.05340 0.04510 0.03760 0.04290 0.03990 0.08170 0.08850 0.08500 0.07320 East Bay Regional Park 0.00880 0.00650 0.00720 0.00650 0.00570 0.00570 0.00570 0.00850 0.00800 0.01000 Flood Zone 7 State Water Bonds 0.01130 0.01450 0.01570 0.01580 0.01450 0.01140 0.01300 0.01510 0.01500 0.01690 Livermore Unified School Bond 2 & Up 0.00000 0.00000 0.00000 0.09550 0.07930 0.07930 0.08300 0.00000 0.00000 0 00000 Livermore Valley Joint Unified School Bond 0.14380 0.08630 0.08200 0.09550 0.07930 0.07930 0.08300 0.06920 0.06260 . 0.06160 Total Direct & Overlapping Tax Rate 1.26970 1.18060 1.18550 1.30070 1.27780 1.28740 1.35880 1.28330 1.29180 1.28590 Total Direct Rate (2) 0.24496 0.24158 0.23978 0.23984 0.23965 0.23965 0.23895 0.23868 0.23849 0.23842 City's Share of 1 % Levy per Proposition 13 (3) 0 0.28177 0.28177 0.28177 0.28177 0.28177 0.28177 0.28177 0.28177 0.28177 Source: Alameda County Assessor's Office for Tax Rate 1998/99 - 2007/08 Tax Rate Table in the City. The City has a total of 38 different TRA administered by the County Tax Collector and the City share of Property Tax can vary by each TRA. Notes: 1) In 1978, California voters passed Proposition 13 which sets the property tax rate at a 1% fixed amount. This 1% is shared by all taxing agenaes for which the subject property resides within. In addition to the 1 % fixed amount, property owners are charged taxes as a percentage of assessed property values for the payment of voter approved bonds from various agencies. 2) Total Director Rate is the weighted average of all individual direct rates. 3) City's Share of 1 % Levy is based on the City's share of the general fund tax rate area with the largest net taxable value within the City. 125 City of Dublin Principal Property Taxpayers Current, And Nine Years Ago .~ 2008/2009 1999/2000 Percent of Total Percent of Total Taxpayer (Number of Pareels) Assessed Value Assessed Value Assessed Value Assessed Value Shops at Waterford LLC (1) $ 128,109,805 1.48% Dublin Corporate Center LP (2) 121,000,000 1.40% ISTAR CTL Dublin LLC (3) 103,000,000 1.19% SR Structured Lot Options I LLC (4) 100,980,000 1.17% Chang S. Lin (5) 96,231,053 1.11 Bere Island Properties I (6) 81,814,714 0.95% Tishman Speyer Archstone-Smith Emerald (7) 76,083,512 0.88% BIT Holding Sixty-Three Inc (8) 69,978,451 0.81 Sorrento Dublin Ranch I Limited Partnership (9) 62,400,157 0.72% Kaiser Foundation Hospitals (10) 61,700,228 0.71 Hong Y. Lin & L. Hong & S. Chang (1) $ 48,726,345 2.07% Albertson Inc (2) 34,860,416 1.48% Rafanelli & Nahas (3) 30,193,715 1.28% Dublin Ranch OA (4) 25,485,296 1.08% Bay Apartment Communities Inc (5) 23,630,461 1.00% Pacific Gulf Property Inc (6) 23,000,000 0.98% US Property Fund GMBH & Company KG (7) 22,306,826 0.95% Northwestern Mutual Life Insurance (8) 20,648,456 0.88% Security Capital Pacific Trust (9) 18,367,843 0.78% St. Michael Investments (10) 17,421,855 0.74% $901,297,920 10.43% $264,641,213 11.24% Source: HDL Coren & Cone and Alameda County Assessor Combined Tax Rolls ~.. 17H i~ /~aa~~g~ City of Dublin Property Tax Levies and Collections Last Ten Fiscal Years Fiscal Collected within the Year Total Tax Fiscal Year of the Levy Collected in Total Collections to Date Ended Levy for Percentage Subsequent Percentage June 30 Fiscal Year Amount of Levy Years Amount of Levy 2000 $ 5,765,531 $ 5,499,897 94.1 % $ 98,390 $ 5,598,287 97.1 2001 7,333,215 6,959,769 95.4% 127,641 7,087,410 96.6% 2002 9,187,641 8,655,872 94.9% 215,980 8,871,852 96.6% 2003 10,732,663 10,142,650 94.2% 412,595 10,555,245 98.3% 2004 11,858,495 11,826,609 94.5% 31,886 11,858,495 100.0% 2005 12,626,880 12,354,685 97.8% 245,157 12,599,842 99.8% 2006 13,909,466 13,530,450 97.3% 254,535 13,784,985 99.1% 2007 17,275,854 16,690,262 96.6% 412,481 17,102,743 99.0% 2008 19,072,467 18,100,067 94.9% 778,895 18,878,962 99.0% 2009 19,812,004 18,584,496 93.8% N/A 18,584,496 93.8% Source: Alameda County Office of the Auditor-Controller Notes: 1) Total Levy includes Secured, Unsecured, and Estimated Unitary Property Taxes 2) Total Collection. includes Secured, Unsecured, and Estimate Unitary Property Taxes less County's administrative cost and E.R.A.F. 127 City of Dublin Direct and Overlapping Debt June 30, 2009 Total Property Tax Assessed Value of Taxable Property $ 8,638,686,162 OVERLAPPING DEBT REPAID WITH PROPERTY TAXES Bay Area Rapid Transit District Chabot-Las Positas Community College District Castro Valley Unified School District Dublin Joint Unified School District East Bay Regional Park District City of Dublin 1915 Act Bonds Califomia Statewide Communities Development Authority 1915 Act Bonds Total overlapping debt repaid with property taxes OVERLAPPING OTHER DEBT Alameda County General Fund Obligations Alameda County Pension Obligations Alameda -Contra Costa Transit District Certificates of Participation Chabot-Las Positas Community College District Certificates of Participation Castro Valley Unified School District Certificates of Participation Total Overlapping Other Debt COMBINED TOTAL DEBT Source: California Municipal Statistics, Inc. Percentage Outstanding Debt Applicable to Estimated Share of 6/30/08 City of Dublin Overlapping Debt $ 441,360,000 1.9600% $ 8,650,656 $ 470,174,226 10.5220% $ 49,471,732 $ 88,245,000 0.6540% $ 577,122 $ 139,318,934 99.9030% $ 139,183,795 $ 125,850,000 2.8840% $ 3,629,514 $ 748,000 100.0000% $ 748,000 $ 1,118,507 100.0000% $ 1,118,507 $ 203,379,326 $ 445,402,000 4.9400% $ 22,002,859 $ 203,020,721 4.9400% $ 10,029,224 $ 42,765,000 0.0280% $ 11,974 $ 4,830,000 10.5220% $ 508,213 $ 655,000 0.6540% $ 4,284 $ 32,556,553 $ 235,935,579 Note: 1) For debt repaid with property taxes, 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. 2) Overlapping governments are those that coincide, generally, within the geographic boundaries of the City. 3) This schedule estimates the portion of the outstanding debt of those overlapping governments that is home by the residents and businesses of the City. This process recognizes that, when considering the City's ability to issue and replay long-term debt, the entire debt burden home by the residents and businesses should be taken into account. However, this does not imply that every taxpayer is a resident, and therefore, responsible for repaying the debt, of each overlapping government. 4) Combined Total Debt excludes tax and revenue anticipation notes, enterprise revenue, mortgage revenue, tax allocation bonds, and non- bonded capital lease obligations. 12R i~~ ~f iga This page intentionally left blank. 129 ~ ~.~ l~~ o ~ /~>~~~ City of Dublin Legal Debt Margin Information Last Ten Fiscal Years Fiscal Year 2000 Assessed valuation Add back exempted real property Total assessed. valuation Conversion Ratio Converted assessed valuation Debt limit percentage Debt limit Total net debt applicable to limit: General obligation bonds Legal debt margin Total debt applicable to the limit as a percentage of debt limit Source: City of Dublin Finance Department 2001 2002 2003 $ 2,353,646,360 $ 3,004,986,989 $ 3,724,977,718 $ 4,308,405,185 32,383,523 60,674,335 64,396,816 70,891,008 $ 2,386,029,883 $ 3,065,661,324 $ 3,789,374,534 $ 4,379,296,193 25 % 25 % 25 % 25 $ 596,507,471 $ 766,415,331 $ 947,343,634 $ 1,094,824,048 15% 15% 15% 15% $ 89,476,121 $ 114,962,300 $ 142,101,545 $ 164,223,607 $ 89,476,121 $ 114,962,300 $ 142,101,545 $ 164,223,607 0.0% 0.0% 0.0% 0.0% Notes: 1. The Government Code of the State of California provides for a legal debt limit of 15% of gross assessed valuation. However, this provision was enacted when assessed valuation was based upon 1981-82 fiscal year, each parcel is now assessed at 100% of market value (as of the most recent change in ownership for that parcel). The computations shown above reflect a conversion of assessed valuation data for each fiscal year from5% of market value. Effective with the current full valuation perspective to the 25% level that was in effect at the time that the legal debt margin was enacted by the State of California for local governments located within the state. 2. Excludes 1915 Act Bonds since they are not General Obligation Debt of the City of Dublin. inn Fiscal Year 2004 2005 2006 2007 2008 2009 $ 4,871,327,283 $ 5,507,782,154 $ 6,310,300,211 $ 7,370,123,956 $ 8,149,582,054 $ 8,638,686,162 70,891,008 72,612,237 77,085,570 80,274,178 78,188,899 36,478,516 $ 4,942,218,291 $ 5,580,394,391 $ 6,387,385,781 $ 7,450,398,134 $ 8,227,770,953 $ 8,675,164,678 25% 25% 25% 25% 25% 25% $ 1,235,554,573 $ 1,395,098,598 $ 1,596,846,445 $ 1,862,599,534 $ 2,056,942,738 $ 2,168,791,170 15% 15% 15% 15% 15% 15% $ 185,333,186 $ 209,264,790 $ 239,526,967 $ 279,389,930 $ 308,541,411. $ 325,318,675 $ 185,333,186 $ 209,264,790 $ 239,526,967 $ 279,389,930 $ 308,541,411 $ 325,318,675 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 1'~~ -_ City of Dublin Demographic And Economic Statistics Last Ten Years w Personal Income (in Per Capita Personal Unemployment Rate Rank in Size of Year City Population (1) Thousands) (2) Income (2) (3) California Cities (1) 2000 32,519 $ 55,790,773 $ 38,458 1.70% 205 2001 32,570 56,121,667 38,417 2.60% 209 2002 33,520 55,316,772 37,755 4.00% 209 2003 35,545 56,424,129 38,712 4.00% 204 2004 38,330 59,339,211 40,915 3.40% 193 2005 39,931 62,015,782 43,074 3.00% 192 2006 41,907 66,998,496 46,414 2.60% 190 2007 43,630 70,761,435 48,679 2.80% 184 2008 46,934 N/A N/A 3.70% 180 2009 47,922 N/A N/A N/A 179 Sources: 1) State of California Department of Finance, Population Estimate at January 1 and City Population Rankings. 2) Bureau of Economic Analysis, Personal Income and Per Capita Personal Income, Alameda County (2 years lag) 3) State of California Employment Development Department, City's Annual Average (1 year lag) 50,000 , 45,000 ~ ~, 40,000 _N c 35, 000 ea a 30,000 0 a 25,000 -~ ~.~t 20 000 9 ~-- --~-_. _T.~__.._ ~ , ~ ~ mod= 00 0~ 0`L 00 0D~ 0h 00 0'l 00 00 0 ~ 0 ~ 0 ~ 0 ~ 0 0 ~ ~ 0 ~ 0 ~ 0 `L 0 ~ Fiscal Year City Population (1) ~~""- "" i3z i /~~ a~ 1 g~ City of Dublin Property Value, Construction And Bank Deposits Last Ten Fiscal Years Commercial Residential Fiscal Year Ended Total Number of Construction Value Construction Value June 30 Permits Issued (1) (1) (1) Bank Deposits (2) 2000 2521 $ 107,242,721 $ 180,258,804 $ 715,313,000 2001 1828 113,618,557 155,286,401 809,281,000 2002 1015 63,476,079 123,149,627 900,670,000 2003 1157 46,448,163 178,361,169 980,220,300 2004 1154 18,575,621 242,563,776 488,343,000 2005 1275 56,481,612 283,817,542 566,441,000 2006 1199 96,389,754 207,862,999 629,684,000 2007 1214 56,832,041 178,094,884 676,681,000 2008 1333 18,256,381 59,647,886 680,695,000 2009 1101 23,968,805 63,242,418 N/A Source: 1) City of Dublin Building Department Status Reports 2) Findley Reports, Inc Bank Deposits represents the amount of cash deposits held by financial institutions within the City annually, Jan thru Dec. New Construction Value - $30o Commercial vs. Residentia $250 ~ _ _ _ _ _. • Commercial ~-Residential $100 _:_ _ 4___ ~ __. 0 $50 _ ~ 00 O~ O`1' 00 Off` Oh OHO O~ O`b O°~ ~O ~O ~O ~O ~O ~O ~O ~O ~O ~O Fiscal Year 14'~ /~~~~' /~;~ ~ City of Dublin Principal Employers Last Two Years 2009 United States Government & Federal Correction Institute Zeiss Meditec Sybase Corporation Dublin Unified School District Micro Dental Laboratories County of Alameda Safeway City of Dublin Franklin Templeton Investments Avaya Target Corporation Number of Employees Ranking 2008 United States Government 2100 1 & Federal Correction Institute 830 2 Zeiss Meditec 730 3 Sybase Corporation 580 4 Dublin Unified School District 550 5 County of Alameda 480 6 Safeway 400 7 City of Dublin 217 8 Micro Dental Laboratories 200 9 Franklin Templeton Investments 180 10 Avaya 180 10 Source: City of Dublin Finance and Economic Development Department Note: Information regarding Principal Employers for prior fiscal years was not available Number of Employees Ranking 2100 1 700 2 650 3 580 4 480 5 400 6 222 7 200 8 200 9 180 10 1'~d City of Dublin Full-time Equivalent City and Contract Government Employees by Function Last Ten Fiscal Years Fiscal Year 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 General government City Manager 3.75 4.00 5.50 5.50 5.75 6.00 7.17 6.25 6.50 6.25 Administrative Services 8.10 9.30 10.00 10.00 11.00 11.50 11.50 11.50 12.00 12.00 Central Services & Building Management 3.04 2.85 3.71 3.60 3.65 3.40 3.43 3.75 3.51 3.52 Public Safety: Police 42.50 47.50 52.50 55.00 54.00 54.00 57.00 59.00 61.00 61.00 Fire 30.17 30.97 30.98 40.00 39.89 40.89 40.25 40.25 40.75 40.78 Disaster Preparedness 0.50 0.50 0.50 0.50 0.50 0.33 0.33 0.33 0.50 0.50 Transportation Public Works 5.00 6.00 6.50 6.50 6.50 6.50 6.50 7.50 8.50 8.50 Street Maintenance 5.56 5.39 5.55 7.60 9.00 9.46 10.14 10.57 10.73 9.93 Health and welfare Housing - - 1.00 1.00 1.00 1.75 1.75 1.75 1.75 2.90 Waste Management - - - - - 0.33 0.33 0.33 0.33 0.33 Culture and leisure services Parks Community Services 11.25 11.75 12.50 12.50 13.00 14.00 14.00 14.00 15.50 16.00 Parks/Facilities Maintenance 5.09 6.38 7.60 7.79 8.48 8.70 9.10 9.53 9.55 9.92 Parks/Facilities Management 1.00 1.00 2.00 2.00 2.00 2.00 2.00 2.00 2.00 2.00 Library Services - - - 0.20 0.60 0.51 0.51 0.48 0.45 0.43 Heritage & Cultural Arts 0.83 1.15 1.96 1.93 1.93 2.31 2.30 2.32 2.53 2.49 Community development Planning & Building 21.50 22.50 25.00 25.00 26.00 32.00 34.50 33.90 32.50 27.10 Economic Development 1.00 1.00 1.00 1.00 1.00 1.00 1.00 1.00 1.00 1.00 Engineering 13.00 13.00 13.00 14.00 13.00 13.35 13.35 13.35 13.35 12.35 Total 152.29 163.29 179.30 194.12 197.30 208.03 215.16 217.81 222.45 217.00 Source: City of Dublin Finance Department Note: Include Full Time, Part Time, and Contract Employees 135 City of Dublin Operating Indicators by Function Last Ten Fiscal Years Fiscal Year 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 Function Police: Calls for Service Citations Issued Arrests Fire: Emergency calls Inspections Building Plan Reviews and Consultations Public works: Bike Path Maintenance (hours) Street Sign Maintenance (number of signs) Curb Painting (linear feet) Replace Street Asphalt (square feet) Street Sweeping (curb miles) Parks and recreation: Museum Visitors Afterschool Recreation (participants/day) Preschool. Classes Participants Youth Basketball League Participants Senior Center Average Daily Attendance Community Development Planning Applications Building Permits Building Inspections Source: City of Dublin 39,976 46,970 50,613 52,708 49,379 48,388 46,197 41,306 41,652 38,983 7,308 9,624 8,364 10,501 11,081 10,911 10,595 11,676 11,768 7,086 1,344 1,272 1,418 1,376 1,614 1,631 2,020 1,668 2,021 1,620 1,634 1,645 1,797 1,872 1,724 1,742 1,771 1,780 1,978 1,969 7,873 7,129 5,182 5,021 4,951 3,249 4,122 4,048 2,213 1,952 843 989 1,270 1,381 1,249 858 1,006 1,049 922 511 100 270 141 326 317 211 5,128 1,637 2,749 256,895 19,545 12,320 4,304 4,336 4,529 420 1,012 793 128 126 134 171 177 176 360 397 445 92 92 97 230 643 2,993 5,500 5,116 300 140 214 476 111 428 308 1,607 3,000 5,371 900 128 268 536 110 783 726 353 435 1,404 3,991 7,500 7,950 5,686 5,730 800 1,350 129 138 224 285 547 580 110 149 810 427 4,006 13,800 5,927 2,140 153 254 588 180 775 135 2,468 33,000 6,075 2,225 180 399 570 185 775 74 2,395 .~ 29,000 6,341 A 2,040 167 402 ~ 591 , 190 54 44 56 78 71 73 59 55 55 64 2,521 1,828 1,429 1,617 1,639 1,837 1,855 1,910 1,333 1,101. 28,232 19,073 16,492 24,682 31,571 33,534 34,244 36,071 25,602 12,302 1 ~F, City of Dublin Capital Asset Statistics by Function Last Ten Fiscal Years Fiscal Year 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 Function Public Safety Police Stations 1 1 1 1 1 1 1 1 1 1 Fire Stations 2 2 2 3 3 3 3 3 3 3 Public works: Street Lights 2,173 2,383 2,504 2,872 2,958 3,469 3,752 3,972 4,193 4,479 Miles of Streets 63 63 65 81 81 81 81 104 93 103 Miles of Curbs 172 172 180 202 202 202 202 217 217 218 Traffic Signals 31 42 49 55 60 62 67 75 79 81. City Street Trees 3,174 3,174 4,585 5,148 5,401 5,955 6,084 6,084 6,084 6,499 City Landscape (acres) 22 22 33 38 38 43 45 45 45 45.31 Parks and recreation: Number of Community Facilities 5 5 5 7 7 7 7 7 7 7 Number of City Parks 8 9 9 11 11 11 11 11 16 16 Acres of City Parks 60 77 84 109 109 109 109 121 122 201 Acres of Open Space 107 107 107 122 122 126 126 126 122 125 Source: City of Dublin 4 137 ~ ~3 a~ lg~ City of Dublin Top 25 Sales Tax Producers `" 2008-2009 ~ BUSINESS NAME BUSINESS CATEGORY Alameda County Auction Motor Vehicle Dealer Alcosta Shell Service Stations Arco AM/PM Mini Mart Service Stations Bed Bath & Beyond Home Furnishings Best Buy Electronics/Appliance Stores Carl Zeiss Ophthalmic System Specialty Stores Dublin Honda Motor Vehicle Dealer Dublin Toyota Motor Vehicle Dealer Dublin Nissan Motor Vehicle Dealer Dublin Volkswagen Motor Vehicle Dealer Expo Design Center Home Furnishings Home Depot Lumber/Building Materials Hummer of Pleasanton Motor Vehicle Dealer Lowes Hardware Store Safeway Grocery Store Liquor Safeway Gas Sales Service Stations Santa Rita Jail Food Service Food Service Saturn of Pleasanton Motor Vehicle Dealer Shamrock Ford Motor Vehicle Dealer Shell/Texaco Service Stations Stoneridge Chrysler Jeep Motor Vehicle Dealer Target Discount Department Store T J Maxx Discount Department Stores Toys R Us Specialty Stores Tri Valley Buick Pontiac GMC Motor Vehicle Dealer Source: Hinderliter, de Llamas & Associates, State Board of Equalization Notes: State Law does not allow disclosure of the top ten sales tax providers to the City Top producers listed in alphabetically order 138 City of Dublin Miscellaneous Statistical Data June 30, 2009 General Date of Incorporation February 1,1982 Form of Government Council/Manager Population 47 922 Number of Registered Voters 20,036 Employees, City and Contract (Full Time Equivalent) 217 Area (Square Miles) 14.01. Parks and Recreation Parks 16.00 Acres in Parks 200.65 Acres in Open Space 124.76 Public Education Elementary Schools 6 Middle Schools 2 High School 1 Continuation High School 1 School Enrollment 5739 Police Protection Number of Stations 1 Police Personnel (Full Time Equivalent) 61 Fire Protection Number of Stations g Fire Personnel (Full Time Equivalent) 38 Community Facilities Dublin Civic Center 1 Dublin Senior Center 1 Dublin Swim Center 1 Dublin Heritage Center 1 Dublin Public Library 1 Shannon Community Center 1 Emerald Glen Activity Center 1 Source: City of Dublin 139 ~. This page intentionally left blank. ..~ 140 CAL Caporicci & Larson Certified Public Accountants ~~~ ~ /8~ INDEPENDENT AUDITORS' REPORT ON COMPLIANCE AND ON INTERNAL CONTROL OVER FINANCIAL REPORTING BASED ON AN AUDIT OF BASIC FINANCIAL STATEMENTS PERFORMED IN ACCORDANCE WITH GOVERNMENT AUDITING STANDARDS To the Honorable Mayor and Members of the City Council of the City of Dublin Dublin, California We have audited the basic financial statements of The City of Dublin (City) as of and for the year ended June 30, 2009, and have issued out report thereon dated December 21, 2009. 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 as a basis for designing our audit procedures for the purpose of expressing our opinion on the financial statements, but not for the purpose of expressing an opinion on the effectiveness of the City's internal control over financial reporting. Accordingly, we do not express an opinion on the effectiveness of the City's internal control over financial reporting. A control deficiency 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 misstatements on a timely basis. A significant deficiency is a control deficiency, or combination of control deficiencies, that adversely affects the entity's ability to initiate, authorize, record, process, or report financial data reliably in accordance with generally accepted accounting principles such that there is more than a remote likelihood that a misstatement of the City's financial statements that is more than inconsequential will not be prevented or detected by the City's internal control. A material weakness is a significant deficiency, or combination of significant deficiencies, that results in more than a remote likelihood that a material misstatement of the financial statements will not be prevented or detected by the City's internal control. Our consideration of internal control over financial reporting was for the limited purpose described in the first paragraph and would not necessarily identify all deficiencies in internal control that might be significant deficiencies or material weaknesses. We identified a deficiency in internal control over financial reporting that we consider to be control deficiency, as defined above. Toll Free Ph: (877) 862-2200 Toll Free Fax: (866) 436-0927 Oakland Orange County Sacramento San Diego 180 GtandAve.,Suite 1365 9 Corporate Park, Suite 100 777 Campus Commons Rd., Suite 200 4558 Mercury, Suite 10C Oakland, California 94612 Irvine, California 92606 Sacramento, California 95825 San Diego, California 92111 ~ 7~ a~ Aga . To the Honorable Mayor and Members of the City Council of the City of Dublin Dublin, California Page 2 Compliance and Other Matters As part of obtaining reasonable assurance about whether the City's 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 result of our tests disclosed no instances of noncompliance or other matters that are required to be reported under Government Auditing Standards. We noted certain matters that we reported to management of the City in a separate letter dated December 21, 2009. The City's written response to the deficiency identified in our audit has not been subjected to the auditing procedures applied in the audit of the financial statements and, accordingly, we express no opinion on it. This report is intended solely for the information and use of management, the City Council, others within the entity, and federal awarding agencies and pass-through entities and is not intended to be and should not be used by anyone other than these specified parties. However, this report is a matter of public record and its distribution is not limited. /~J_ „„„ice; ~ ~L,,,K" C~ ^ Oakland, California December 21, 2009 142 ~ .~. ~~9 ~f Aga City of Dublin Report to the City Council and Management Table of Contents Page Independent Auditors' Report .................................................................................................................................1 Control Deficiencies: Prior Period Adjustment ....................................................................................................................................... 2 /~~ ~~ /~~ CAL Caporicci & Larson Certifzed Public Accountants December 21, 2009 To the Honorable Mayor and Members of the City Council of the City of Dublin Dublin, California In planning and performing our audit of the financial statements of the City of Dublin (City) as of and for the year ended June 30, 2009, in accordance with auditing standards generally accepted in the United States of America, we considered the City's internal control over financial reporting (internal control) as a basis for designing our auditing procedures for the purpose of expressing our opinion on the financial statement, but not for the purpose of expressing an opinion on the effectiveness of the City's internal control. Accordingly, we do not express an opinion on the effectiveness of the City's internal control. Our consideration of internal control was for the limited purpose described in the preceding paragraph and would not necessarily identify all deficiencies in internal control that might be significant deficiencies or material weaknesses. However, as discussed below, we identified a deficiency in internal control that we consider to be control deficiency. A control deficiency 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 misstatements on a timely basis. One control deficiency in internal control identified in the audit is discussed on page 2 of this report. A significant deficiency is a control deficiency, or combination of control deficiencies, that adversely affects the entity's ability to initiate, authorize, record, process, or report financial data reliably in accordance with generally accepted accounting principles such that there is more than a remote likelihood that a misstatement of the entity's financial statements that is more than inconsequential will not be prevented or detected by the entity's internal control. We did not identify any deficiencies in internal control that we consider to be significant deficiency as identified above. A material weakness is a significant deficiency, or combination of significant deficiencies, that results in more than a remote likelihood that a material misstatement of the financial statements will not be prevented or detected by the entity's internal control. We did not identify any deficiencies in internal control that we consider to be material weaknesses as identified above. The City's written response to the deficiencies identified in our audit has not been subjected to the auditing procedures applied in the audit of the financial statements and, accordingly, we express no opinion on it. This communication is intended solely for the information and use of City Council, management, and others within the organization, and is not intended to be and should not be used by anyone other than these specified parties. ~;u,; ~ ~~`"`" Caporicci & Larson Oakland, California Toll Free Ph: (877) 862-2200 Oakland Orange County 180 GrandAve., Suite 1365 9 Corporate Park, Suite 100 Oakland, California 94612 Irvine, California 92606 Toll Free Fax: (866) 436-0927 Sacramento San Diego 777 Campus Commons Rd., Suite 200 4858 Mercury, Suite 106 Sacramento, California 95825 San Diego, California 92111 /~' ~~ /g~ City of Dublin Report to the City Council and Management For the year ended June 30, 2009 CONTROL DEFICIENCIES 1. PRIOR PERIOD ADJUSTMENT Observation The City has restated its previously issued financial statements to correct misstatements relating to capital assets and deferred revenue. The City's internal controls over financial reporting did not identify the misstatements in a timely manner resulting in the restatements. Recommendation We recommend that the City review all current year transactions carefully to avoid future adjustment to prior periods. Management Response Management Staff recognize the importance and responsibility to develop systems and implement procedures that will allow for accurate and up to date reporting of financial transactions. The ultimate responsibility for the preparation of the financial statements rests with the City Staff. City Staff concur with the need to diligently review all items to avoid the need for a restatement and have developed an action plan. Responsible staff will also prepare information on the detailed steps of validation and verification undertaken which will be reported to the City Manager. The restatement involved three items. The closing entries for Fiscal Year 2007-2008 made an adjustment to remove Traffic Impact Fee Credits that should have not been capitalized. As a related entry there was also a need to adjust accumulated appreciation and this was admittedly overlooked, resulting in a prior period adjustment of $427,434 to Accumulated Depreciation. It is important for readers to have an understanding of key accounting concepts as they relate to the City and the reporting of depreciation. Depreciation recorded does not impact cash positions of the entity. In governmental accounting, depreciation entries are used to disclose the historical cost of capital expenditures over the life of the capital asset. The "depreciation' item is only reported as part of the Government-Wide Financial Statements and is not included in the Governmental Fund Statements. ACTION ITEM: The City is implementing a fixed asset system as part of the upgrade of its financial system. This system will also be helpful in tracking and recording changes in fixed assets. Since it is integrated with the Finance System it can also be used for tracking depreciation and adjustments to accumulated depreciation as assets are removed. The City Staff had included a $1,250,000 Deferred Revenue in the City Financial Records used to prepare the Fiscal Year 2007-2008 Audit. This was erroneously excluded from the final statements although it was recorded in the General Ledger. i~a ~f ~8a City of Dublin Report to the City Council and Management, Continued For the year ended June 30, 2009 CONTROL DEFICIENCIES, Continued 1. PRIOR PERIOD ADJUSTMENT, Continued Management Response, Continued ACTION ITEM: The City has acquired a software module for GASB 34 reporting which will be implemented. This will better integrate data directly from the General Ledger for the Comprehensive Annual Financial Report format. The City collected Traffic Impact Fees in Fiscal Year 2007-2008 to finance the Interstate 580 / Fallon Road Interchange. This infrastructure financing was in accordance with an agreement with a single Developer. The Agreement allowed for a refund of funds once specific cost information was finalized. Based on bids received below the original project cost estimate a refund of $2,216,700 was made to the Developer. City Staff made a decision to re-state the prior period revenue as this represented a significant amount of Impact Fees which were not required to complete the project. The restatement includes this transaction. ACTION ITEM: This was a unique one-time item and lump-sum advanced financing of this nature is not planned for any future projects. Should this occur Staff will closely evaluate the recording options at the time the funds are received to consider ways to mitigate a future restatement.