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Agenda Report - April 7, 1993 (97)
r .a CITY OF LOBI COUNCIL COMMUNICATION AGENN TITLE: COMPREHENSIVE ANNUAL FINANCIAL REPORT FISCAL YEAR 1991-92 MEETING DATE: April 7, 1993 PREP411tED By: Finance Director REC%\AMENDED ACTION: That the City Council receive for filing the following reports submitted by the City's auditors (KPMG Peat Marwick) for the fiscal year ended June 30, 1992: * Management Letter dated November 9, 1992 * Independent Auditor's Opinion fn: City Investments Single Audit Report * Comprehensive Annual Financial Report (CAFR) BACWtROUND INFORMATION: The City Council annually engages the audit firm of KPMG Peat Marwick to audit and review the City's financial records and internal controls for fairness and completeness in accordance with generally accepted accounting standards and F4f4itpliance with applicable laws and regulations under which the City must comply for Federal frnarl4M assistance. In addition, the City Council receives a Management letter in which the auditors repoA %eir findings with respect to the City's internal controls and significant operational matters. Finajt N the auditors prepare a report to the City Council to confirm that they have reviewed the City's InveM%ent policy and whether the City's funds are being invested in accordance with the approved policy and WIvernment code. COh'{I&INED ANNUAL FINANCIAL REPORT The %hibined Annual Financial Report (CAFR) was prepared by City staff in accordance with standards set bX• khe Government Accounting Standards Board and is presented in four sections to assist the reader uncle;end and analyze the City's financial condition. These sections are: * Introduction - Includes Finance Director's comments, economic conditions. and outlook, major initiatives, and pertinent financial information, management actions and financial controls. * Financ%31 Section - Includes the Independent Auditor's Report, the General Purpose Financial Statements and footnotes to these statements which are normally very informative to the reviewer. 'XPPROVEr-L, THOMAS A. PETERSON City Manager twi recycled paper D�m e Supplemental Financial Statements - Includes detailed financial statements and budget performance by fund and by activity (General Fund, Special Revenue Funds, Debt Service Fund, Capital Project Funds, Enterprise Funds, Internal Service Funds, Trust And Agency Funds, General Fixed Assets and General Long Term Debt. Statistical Tables - Includes unaudited information and statistics needed to evaluate the City's long term financial condition and capacity. The purpose of the audit is to: Assure taxpayers, the City Council. investors and creditors that the financial statements have been corroborated by a qualified third party and they do in fact represent the financial condition of the City in accordance with "generally accepted accounting principles". Assure the City Council of staff accountability in the execution of the budget as approved by the City Council. In the course of the audit, the auditor's conduct test, take samples and review financial transactions and reports of City staff. From this information, the auditors express an opinion as to the conformance of the financial statements with "generally accepted accounting principles" and as to whether the internal controls are such that they provide a reasonable but not absolute assurance that the City's assets are safeguarded against loss from unauthorized use or disposition. It is not the auditors responsibility to accomplish the following: * Assume responsibility for .the preparation and accuracy of the financial statements. The City is ultimately responsible for the financial statements. It is the auditor's role to express an opinion on management's assertions as to financial condition. * Assure users that the City's financial statements and all information in the statements are accurate. The auditors do the work necessary to provide reasonable assurance that the financial statements are not materially r,isstated. * Examine all transactions and events reflected in the City's financial statements. Rather, they use samples of transactions and events on a test basis to evaluate the transactions and events in the financial statements. * Detect all possible fraudulent activities that might occur during the fiscal period. The audit is designed only to detect those irregularities that could have a material effect on the fair presentation of the financial statements. This is the second year which the City has prepared a Combined Annual Financial Report (CAFR) and the first year the report has been submitted to the Government Finance Officer's Association for evaluation under the "Excellence in Financial Repo -ting" program. The results of the evaluation should be known by early summer. The City benefits from this evaluation program by receiving a detailed analysis of the CAFR and by suggestions for improvement, by recognition if and when the report meets the standards set by the accounting profession, and assures lenders, investors, Council, management and citizens that the financial information reported in the CAFR is complete and fair. r Specially noteworthy, the City staff for the first time received an audit opinion which assures the City Council and citizens of Lodi that all conditions for fair and complete reporting has been met. This is referred to in the accounting profession as an "unqualified opinion". SINGLE AUDIT RkPORT The "Single Audit Rey^r+" is mandated by the Federal Government for agencies receiving federal financial assistance and reports the result of the audit in accordance with "general accepted government accounting standards" set by the United States Office of Management and Budget. The intent of the audit is to assure the public that the City is in compliance with Federal laws and regulations governing the use of Federal funds. MANAGEMENT LETTER The auditors have a reporting responsibility to report weaknesses in internal controls, including material weaknesses, discovered in the course of the audit. These weaknesses are reported under separate cover to management and may or may not be made available to the public. Lodi has for many years fully disclosed this report to assure the public of the honesty and integrity of the City's in the management of their funds. Attached to the Management Letter is the staff recommendations and actions needed to correct the findings of the auditors. INDEPENDENT AUDITOR'S REPORT Due in part to significant investment losses by local government agencies in recent years, the auditor's are now required to review the investment policy and investments of the City and report whether the City's investments are in accordance with the Council policy and government code. This report is not intended to tell the Council whether the City's investments are prudent, provide the best possible yield, are safe from loss, or the highest degree of liquidity as possible. FUNDING None Dixon Flynn Finance Director Attachments Comprehensive Annual Financial Report (June 30, 1992) Single Audit Report Management Letter Independent Auditor's Report MEMORANDUM March 18, 1993 TO: Thomas A. Peterson, City Manager FROM: Dixon Flynn, Finance Directe,r SUBJECT: NIANAGEIWENT LETTER (1991-92 AUDIi) RECOi\WEENDED ACTION 1. That the City Manager receive for 'Management Letter submitted by KPMG Peat Marwick, , e concluded on November 9, 1992 and submit to the the City's audit firm, resulting f City Council for file at the COL. -1W -duled for April 21, 1993. 2. That the City Manger approve the recon. zd corrective actions and that they be placed before the City Council for discussion and fundi. _ .wring budget hearings to adopt the 1993-94 Budget. BACKGROUND INFORMATION In the process of obtaining evidence needed to express an opinion on the presentation of the City's financial statements, the City'F auditors have discovered weaknesses in the City's internal control structure which they are required to report to the City Council. If these conditions had been of such significance that they would have resulted in a material misstatement of the City's financial reports or internal controls, they would have been disclosed in the auditors opinion. Fortunately, this is not the case and accordingly, these findings have been reported in the attached Management Letter. RECOMMENDED CORRECTIVE ACTIONS Fixed Assets 1. A Property Management and Accounting Policy will be prepared and submitted to the City Council for discussion, guidance and approval to identify the City's property management policies and procedures and which will also identify the classes of assets to be tagged and inventoried. 2. Identification tags have been ordered to tag and identify assets which will require identification under the policy recommended above. 3. A Capital Project and Purchasing Policy will be prepared and submitted to the City Council for discussion, guidance and approval to identify polices regarding the planning, budgeting, accounting, control, and reporting on capital projects and purchases to be capitalized in the City's fixed asset accounts. Self -Insurance 1. The City should contract with the City's audit firm for a review of the City's self-insurance programs, to include worker's compensation, liability, property damage and third -party -administrator(s) to determine the adequacy of the budget and management controls, policies to include reserve policies, record keeping procedures and claim processing. 2. During the review recommended abover, the auditor should also review the City's safety programs, policies and procedures as to adequacy and make recommendations needed to improve control and reduce the inereaseing costs arising from injuries. Estimated cost of both reviews is $10,000 to $15,000. r Deficit Spending 1. The City Manager will develop and recommend long-term policies and plans to the City Council for adoption to correct the long-term trend of deficit spending in the general fund. This will include policies such as: * Privatization * Contracting for services with service contractors and other public agencies Growth control of staff and employee compensation * Promotion of efficiency and performance management * Cut back management * Revenue management 2. In the current year, the City Manager and City Council have been conducting a series of meetings with the staff and citizen groups to review options available to control and/or reduce costs and services. Electronic Data Processing System The City should contract with a qualified consultant to review the Data Processing Function of the Finance Department to evaluate data processing systems, to determine the most cost effectiveness between options, and to recommend strategies and programs to provide data processing/information systems to City users now and into the future. Estimated cost of the contract is $15,000 to $25,000. Budget to Actual Reconciliations The City Manager will develop and recommend financial polices to ensure the City's budgeting and financial reporting and accounting are conducted on a basis to allow comparability and in accordance with 'generally accepted accounting principles*. Review of Investment Compliance The donations and bequests made to the Library will be placed in a trust account to be administered by rules and policies established in the Trust Agreement established between the City and the Library Board. On approval of the Agreement between the City Council and the Board, the funds will be exempt from the City's general investment policies. This will in effect correct for the finding made by the City's auditors. C= ixon Flynn Finance Director Approved Thomas A Peterson City Manager Peat Marwick Cortihad Pubbc Accountants 2495 Naiomas Park [hive Sacramento. CA 958332936 November 9. 1992 The Honorable Members of the City Council City of Lodi. California: We have audited the general purpose financial statements of the City of Lodi, California (City) for the year ended June 30. 1992. and have issued our report thereon dated November 9. 1992. In planning and performing our audit of the general purpose financial statements of the City we considered the internal control structure in order to determine our auditing procedures for the purpose of expressing our opinion on the general purpose financial statements and not to provide assurance on the internal control structure. We have not considered the internal control structure since the date of our report. During our audit we noted certain matters involving the internal control structure and other operational matters that are presented for your consideration. These comments and recommendations, all which have been discussed with the appropriate members of management, are intended to improve the internal control structure or result in other operating efficiencies, are summarized as follows: During the performance of our audit procedures on fixed assets. we observed the following: • Fixed assets are not specifically tagged for identification • Construction in progress and fixed asset records in most cases did not list the assets individually but rather stated monthly expenditures for fixed asset items with no descriptions for the items acquired. • No written policy for capitalization of fixed assets exist. A written policy provides guidance to accounting personnel and enhances consistent recording of fixed asset acquisitions. We recommend the City implement the following suggestions: • Assign a fixed asset number to machinery, equipment and vehicles when purchased and record on a fixed asset listing the asset number, description, dollar value, purchase date and estimated useful life. Detailed supporting documentation including the approved purchase order, vendor invoice and check copy should be maintained. A periodic inventory of fixed assets *-tild be taken and compared to the detailed listing. This could be done by the department heads and then randomly audited by the Finance Department. The Honorable Members of the City Council City of Lodi. California November 9. 1992 Pace 2 • Prepare a comprehensive fixed asset report based upon fixed asset expenditures. Supporting documentation should be maintained to support these amounts and their authorization. This report should be reconciled to the general ledger monthly. • Maintain a file for all construction in progress. This file should include resolutions authorizing the construction, a copy of the construction contract and support for all expenditures which are capitalized into construction in progress. • Develop a written capitalization policy which describes assets to be capitalized and establishes a minimum dollar amount for capitalization. The recommendations will result in improved accountability and record keeping of City assets they will also increase the accuracy of City records and provide enhanced safekeeping of City assets. During our review of the self-insurance area. we observed that there has been a dramatic increase in the number of worker's compensation claims and the amount of the settlements. We also noted that the reserve balance was not reconciled in a timely basis and the monitoring of claims could possibly be improved. Additionally. it was observed that the City has not had an independent review of its self-insurance function. We recommend that the City have an independent review of its self-insurance function and third -party administrator. We also believe that the City should evaluate and update its current safety programs. A review of the self-insurance function would ensure that adequate controls ate maintained over record keeping and claim processing. A strong claims processing function will ensure that all claims are valid and settlements are reasonable based on the injury incurred. By reviewing and updating the City's safety programs, the City should have fewer accidents and reduce the number of claims filed. We observed that the City's expenditures exceeded revenues resulting in deficit spending in the general fund. We recommend that the City develop short-term and long-term plans to address this problem. The City has minimal general fund reserves and continued deficit spending with anticipated additional state spending cuts, in time. could raise the issue of the economic viability of the City. These plans should consider the feasibility of various options currently being used by other cities to address this problem. such as. redevelopment agencies, special assessment districts, issuance of bonds, performance audits of City's departments, etc. We believe it is critical for the City's long-term economic future that the current trend be reversed. The Honorable 4tembers of the City Council City of Lodi. California November 9. 1992 Page 3 The City has not had an independent review of its EDP function. It was also observed that the City's general ledger and accounting systems are: very old and greatly increase the workload of City employees. A review of the EDP function would check for internal control weaknesses. the adequacy of equipment and software. disaster recovery planning and EDP strategic planning. In addition. the review would provide the City with recommendations in updating its general ledger and accounting systems to a more efficient and user friendly environment. The budget is a tool that should be used for monitoring the ongoing activity of the fund or function. Currently. the budget is formatted in such a way that it is not easily comparable to the year-end financial statements or monthly financial information. The budget should be prepared in a format that will provide easy access to information for budget to actual comparisons. This will assist in monitoring budgetary control and determining expenditure authorizations. U' =I- tt t t tti;, We were requested by the City to review compliance with respect to the City's investment policy. This policy includes a list of investments instruments which are allowable under current legislation of the State of California (Government Code Section 53600 et seq.). We noted that investments in common stock are not an allowable investment under the prescribed policy. The City's library has obtained common stock through bequests and dividend reinvestments programs. The dividend reinvestment programs are. to effect, the acquisition of stock. The City should consider discontinuing the dividend reinvestment program and receiving only cash dividends or amending its investment policies. We applaud the City's and especially the Finance Department's efforts in the preparation of a comprehensive annual financial report (CAFR) and applying for the Certificate of Achievement for Excellence in Financial Reporting. Many benefits likely to be realized by a city which submits its CAFR to the Certificate of Achievement review process include: • Education - Governmental units are provided with extensive technical accounting and financing reporting reference material. Officials submitting the CAFR are provided with a confidential list of detailed comments and suggestions for improvements in their financial reporting techniques. • Recognition - The Certificate of Achievement is the highest form of recognition in governmental accounting and financial reporting. and its attainment represents a significant accomplishment by a governmental unit and its management. 9. r i The Honorable Members of the City Council City of Lodi. California November 9. 1992 Page -t • Securities ;Marketing Aid - Reports qualifying for a certificate provide a detailed vehicle by which market anaiysts. investors. potential investors. and others may assess the relative attractiveness of a governmental unit's securities compared to alternative investment possibilities. • Comparability - Since reports qualifying for a certificate employ standardized terminology and formatting conventions, comparisons from one year to the next and among diftcrent governmental units is easier. • Completeness - The financial statements, supporting, schedules, statistical tables. and narrative explanations required for the certificate help to ensure that all fiscal data are presented that are needed by the many persons and groups with legitimate interest in the financial affairs of a governmental unit. These groups include governing boards, oversight bodies, investors and creditors, grantor resource providers, taxpayers, and others. Additional suggestions of an operational nature were presented to management under a separate letter also dated November 9. 1992. This report is intended solely for the information and use of the City Council, management and others within the organization. We would like to extend our appreciation for the assistance and courtesies extended to us by City employees during the conduct of our audit If we can be of further assistance or if you have any questions, please do not hesitate to call us. a NOW Peat Marwick Certfied Public Accountams 2495 4aromas Past ():,r $jcrame>nto, CA 95833-2936 The Honorable Members of City Council City of Lodi. California: We have applied certain agreed-upon procedures, as discussed below, with respect to the City of Lodi, California's (City) Statement of Investment Policy adopted by the Council Resolution 91- 175, as discussed below, solely to assist you in evaluating compliance with that policy. It is understood that this report is solely for your information and is not to be referred to or distributed for any purpose to anyone who is not a member of the City Council or management of the City. Our procedures and findings are summarized as follows: 1. We confirmed the City's investments as of June 30. 1992. We observed no unreconcilable differences between the confirmed investment balances at June 30. 1992 and the recorded general ledger investment balances at June 30. 1992. 2. We read the Statement of Investment Policy adopted by Council Resolution 91-175. The City was not in compliance with the Statement of Investment Policy as to allowable investment instruments as the City's Library investment portfolio included common stock valued at approximately $135,000 with a cost basis of $57.085 at June 30, 1992. The library obtained this stock through bequests and dividend reinvestment programs. The investment policy does not identify common stock as an allowable investment. Because the above procedures do not constitute an audit conducted in accordance with generally accepted auditing standards, we do not express an opinion on any of the specified accounts or terms referred to above. In connection with the procedures referred to above, no matters came to our attention that caused us to believe that the City's management did not comply with the Statement of Investment Policy adopted by Council Resolution 91-175, except as noted above. Had we performed additional procedures or had we conducted an audit of the Statement of Investment Policy in accordance with generally accepted auditing standards, matters might have come to our attention that would have been reported to you. This report relates only to the accounts or items specified above and does not extend to any financial statements of the City, taken as a whole. November 9, 1992 me KPMG Peat Marwick CITY OF LODI, CALIFORNIA Single Audit Reports Year Ended June 30. 1992 0 r - .1 In CITY OF LODI. CALIFORNIA Single Audit Reports Year Ended June 30. 1492 Independent Auditors' Report on Schedule of Federal Financial Assistance Scheduk of Federal Financial Assistance Notes to Schedule of Federal Financial Assistance Independent Auditors Report on Compliance at the General Purpose Financial Statement Level Independent Auditors' Report on Internal Controls at the General Purpose Financial Statement Level Independent Auditors' Report on Compliance with General Requirements Applicable to Federal Financial Assistance Programs Independent Auditors' Report on Compliance with Specific Requirements Applicable to Major and Nonmajor Federal Financial Assistance Programs Independent Auditors Report on the Internal Control Structure Used in Administering Federal Financial Assistance Programs - Major Program Less Than 50 Percent of Total Expenditures Status of Prior Year Findings and Recommendations �!r 1 2 3 4 5-6 7 8-9 10-12 13 M Mw-- Peat Marwick Cartdiad PuWtc Accountants 2495 WOttta! Park D v-- Sacramt'rnu. CA 9583'3 2916 INDEPENDENT AUDITORS' REPORT ON -;CHEDI!LE OF FEDERAL FINANCIAL ASSISTANCE The Honorable Members of City Council City of Lodi. California: We have audited the general purpose financial statements of the City of Lodi. California as of and for the year ended June 30. 1992. and haNc issued our report thereon dated November 9. 1992. These general purpose financial statements are the responsibility of the management of the City. .� Our responsibility is to express an opinion on these general purpose financial statements based on our audit. We conducted our audit in accordance with generally accepted auditing standards and Garernmenr Auditing Standards, issued by the Comptroller General of the Utti—d States. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the general purpose financial statements are free of material misstatement An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the general purpose financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management. as well as evaluating the overall financial statement presentation. We believe that our audit provides a reasonable basis for our opinion. 40 Our audit was made for the purpose of forming an opinion on the general purpose financial statements of the City of Lodi. California. taken as a whole. The accompanying schedule of federal financial assistance is presented for purposes of additional analysis and is not a required part of the general purpose financial statements. The information in that schedule has been subjected to the auditing procedures applied in the audit of the general purpose financial statements and. in our opinion, is fairly stated in all material respects in relation to the general purpose financial statements taken as a whole. November 9. 1992 tMr•v.n (r^ .... .... .. . I .. ..... ....P l CITY OF LODI, CALIFORNIA Schedule of Federal Financial Assistance Year Ended June 30, 1992 See accompanying rotes to schedule of federal financial assistance. -2- Federal CFDA • or Grantor's Pass -Through Federal Grantor/Program Title Number Revenues Expenditures MAJOR PROGRAM: U.S. Department of Housing and Urban Development: Community Development Block Grants: 1991-1992 Program Year 14.228 $ 46.107 46.107 1990-1991 Program Year 14.228 152.712 152.712 1989-1990 Program Year 1.3.228 66.886 66,886 1988-1989 Program Year 14.228 78.060 78,060 1987-1988 Program Year 14.228 498 498 344.263 344.263 NONMAJOR PROGRAMS: ra U.S. Department of Transportation: Federal Urban Aid 20.205 505.901 229.925 U.S. Department of Transportation: K) (Pass-through Calif. Office of Traffic Safety): :4L 9110 20.600 4.428 4,428 U.S. Department of Education: (Pass-through State Office of Criminal Justice Planning): Crac-Net DC 90010390 16.579 82.652 139,932 Total federal financial assistance $ 937.244 718.548 See accompanying rotes to schedule of federal financial assistance. -2- CITY OF LODI. CALIFORNIA Notes to Schedule or Federal Financial Assistance June 30, 1992 (1) General The accompanying Schedule of Federal Financial assistance presents the activity of all federal financial assistance programs of the City of Lodi. California (City). The City reporting entity is defined in note I to the City's general purpose financial statements. Federal financial assistance is received directly from federal agencies and through other government agencies. (2) Basis or Accounting - Grant Program The Schedule of Federal Financial Assistance has been prepared on the modified accrual basis of accounting which is described in note t to the City's general purpose financial statements. (3) Relationship to General Purpose Financial Statements Federal financial assistance revenues are reported in the Cit)s general purpose financial statements for the year ended June 30. 1992. as follows: Revenue lntereovernmentat General Fund S 87.080 Special revenue fund 850-164 Total S 937,244 Total federal assistance revenues do not agree with expenditures reported on the Schedule of Federal Financial Assistance due to the timing of the submission of claims for reimbursement of expenditures. (4) Relationship to Federal Financial Reports Amounts reported in the accompanying schedule agree with the amounts reported in the related federal financial reports. r� Peat Marwick n f; Caroried Pub4c Accountants 2495 Natomas Park Oro. - Sacramento CA 95833-2936 INDEPENDENT AUDITORS' REPORT ON COMPLIANCE AT THE GENE AL PURPOSE FINANCIAL STATEMENT LEVEL The Honorable Members of City Council City of Lodi. California: We have audited the general purpose financial statements of the City of Lodi. California as of and for the year ended June 30. 1992. and have issued our report thereon dated November 9, 1992. We conducted our audit in accordance with generally accepted auditing standards and 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 general purpose financial statements are free of material misstatement. Compliance with laws. regulations. contracts. and grants applicable to the City of Lodi. California is the responsibility of the management of the City of Lodi. California. As part of obtaining reasonable assurance about whether the general purpose financial statements are free of material misstatement. we performed tests of the City of Lodi. California's compliance with certain provisions of laws. regulation-,. contracts. and grants. However. our objective was not to provide an opinion on overall compliance with such provisions. Accordingly, we do not express such an opinion. s The results of our tests indicate that. with respect to the items tested. the City of Lodi. California complied, in all material respects, with the provisions referred to in the preceding paragraph. With respect to items not tested, nothing came to our attention that caused us to believe that the City of Lodi. California had not complied, in all material respects, with those provisions. This report is intended for the information of the City Council, management, and the U.S. Department of Housing and Urban Development. This restriction is not intended to limit the distribution of this report. which is a matter of public record. November 9. 1992 ME Peat Marwick Candied Public Accountants r 2495 Natornas Part Drvr Sacramento. CA 95833.7936 n INDEPENDENT AUDITORS' REPORT ON INTERNAL CONTROLS AT THE GENERAL PURPOSE FINANQAL• STATEMENT LEVEL The Honorable Members of City Council City of Lodi. California: We have audited the general purpose financial statements of the City of Lotti. Cal'tomia as of and for the year ended June 30. 1992. and have issued our report thereon dated November 9. 1992. el We conducted our audit in accordance with generally accepted auditing standards and 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 general purpose financial statements are free of n.aterial misstatement. In planning and performing our audit of the general purpose financial statements of the City of Lodi. California for the year ended June 30. 1992. we considered its internal control structure in order to determine our auditing procedures for the purpose of expressing our opinion on the general purpose financial statements and not to provide assurance on the internal control structure. The management of the City of Lodi. California is responsible for establishing and maintaining an internal control structure. In fulfilling this responsibility. estimates and judgments by management are required to assess the expected benefits and related costs of internal control structure policies and procedures. The objectives of an internal control structure are to provide management with reasonable. but not absolute. assurance that assets are safeguarded against loss from unauthorized use or disposition. and that transactions are executed in accordance with management's authorization and recorded properly to permit the preparation of general purpose financial statements in accordance with generally accepted accounting principles. Because of inherent limitations in any internal control structure. errors or irregularities may nevertheless occur and not be detected. Also. projection of any evaluation of the structure to future periods is subject to the risk that procedures may become inadequate because of changes in conditions or that the effectiveness of the design and operation of policies and procedures may deteriorate. For the purpose of this report. we have classified the significant internal control structure policies _ and procedures in one category: Accounting Applications - Expenditures and Disbursements. -5- 4M`+.�<1...- -, Ift For the internal control structure category listed above. we obtained an understanding of the design of relevant policies and procedures and whether they have been placed in operation and we assessed control risk. Our consideration of the internal control structure would not necessarily disclose all matters in the internal control structure that might be material weaknesses under standards established by the American Institute of Certified Public Accountants. A material weakness is a reportable condition in which the design or operation of one or more of the specific internal control structure element.,, does not reduce to a relatively low level the risk that errors or irregularities in amounts that would be material in relation to the general purpose financial statements being audited may occur and not be detected within a timely period by employees in the normal course of performing their assigned functions. We noted no matters involving the internal control structure and its operation that we consider to be material weaknesses as deftned above. However, we noted certain matters involving the internal control structure and its operations that we have reported to the management of the City of Lodi. California, in a separate letter dated November 9. 1992. This report is intended for the information of the City Council. management, and the U.S. Department of Housing. and Urban Development. This restriction is not intended to limit the distribution of this report, which is a matter of public record. November 9, 1992 -6- a Peat Marwick Conrftd Public Accountants uta 2495 Natomas Park p•Ne Sacramento, CA 95833.2936 io INDEPENDENT AUDITORS' REPORT ON COMPLIANCE WITH GENERAL REQUIREMENTS APPLICABLE TO FEDERAL FINANCIAL ASSISTANCE PROGRAhIS w The Honorable Members of City Council City of Lodi, California: We have audited the general purpose financial statements of the City of Lodi. California as of and for the year ending June 30, 1992, and have issued our report thereon dated November 9, 1992. We have also applied procedures to test the City of Lodi. California's compliance with the following requirements applicable to its federal financial assistance programs, which are identified in the schedule of federal financial assistance. for the year ended June 30, 1992: political activity: Davis -Bacon Act. civil rights: cash management: relocation assistance and real property acquisition; federal financial reports: allowable costs/cost principles. Drug -Free Workplace Act: and administrative requirements Our procedures were limited to the applicable procedures described in the Office of Management and Budget's Compliance Supplement for Single Audits of State and .'.ocai Governments. Our procedures were substantially less in scope than an audit, the objective of which is the expression of an opinion on the City of Lodi. California's compliance with the requirements listed in the preceding. paragraph. Accordingly, we do not express such an opinion. With respect to the items tested, the results of those procedures disc!osed no material instances of noncompliance with the requirements listed in the second paragraph of this report. With respect to items not tested, nothing came to our attention that caused us to believe that the City of Lodi. California had not complied, in all material respects, with those requirements. This report is intended for the information of the City Council, management, and the U.S. Department of Housing and Urban Development. This restriction is not intended to Iimit the distribution of this report, which is a matter of public record. November 9. 1992 ®®®n Memtw n,..,. KM+rhi P✓n: \• KA�.0 P� ►��� r. ,r Peat Marwick CetO" Pubbc Accountamts 2495 Nalomas P,a. Dr v - Sacramento. CA 95833-2936 INDEPENDENT AUDITORS' REPORT ON COMPLIANCE WITH SPECIFIC REQUIREMENTS APPLICABLE TO MAJOR AND NONMAJOR FEDERAL- FINANCIAL ASSISTANCE PROGRAM The Honorable Members of City Council n City of Lodi. California: We have audited the general purpose financial statements of the City of Lodi. California. as of and for the year ended June 30. 1992. and have issued our report thereon dated November 9. 1992. We have also audited the City of Lodi. California's compliance with the requirements governing el types of services allowed or unallowed: eligibility: matching. level of effort, or earmarking: reporting: claims for advances and reimbursements: and amounts claimed or used for matching that are applicable for its major federal financial assistance. which are identified in the accompanying schedule of federal financial assistance for the year ended June 30. 1992. The manaeement of the City of Lodi. California, is responsible for the City of Lodi. California's compliance with those requirements. Our responsibility is to express an opinion on compliance r with those requirements based on our audit. We conducted our audit in accordance with generally accepted auditing standards. Gorernment Auditing Standards, issued by the Comptroller General of the United States, and OMB Circular A- 128. Audits of State and Local Governments. Those standards and OMB Circular A- 128 require that we plan and perform the audit to obtain reasonable assurance about whether material - noncompliance with the requirements referred to above occurred. An audit includes examining, on a test basis, evidence about the City of Lodi. California's compliance with those requirements. We believe that our audit provides a reasonable basis for our opinion. In our opinion. the City of Lodi. California, complied, in all material respects, with the requirements governing types of services allowed or unallowed: eligibility: matching, level of effort. or earmarking. reporting. claims for advances and reimbursements: and amounts claimed or used for matching that are applicable for its major federal financial assistance program for the year ended June 30, 1992. In connection with our audit of the 1992 general purpose financial statements of the City of Lodi. California, and with our study and evaluation of the City of Lodi. California's internal control systems used to administer the federal financial assistance program as required by OMB Circular A-128, we selected certain transactions applicable to certain nonmajor federal financial assistance programs for the year ended June 30. 1992. As required by OMB Circular A-128. we have performed auditing procedures to test compliance with the requirements governing types of services allowed or unallowed: and eligibility that are applicable to those transactions. Our procedures were substantially less than scope than an audit, the objective of which is the expression of an opinion on the City of Lodi. California's compliance with these requirements. Accordingly. we do not express such an opinion. -8- With respect to the items tested, the results of those procedures disclosed no material instances of noncompliance with the requirements listed in the preceding paragraph. With respect to items not tested. nothing came to our attention that has caused us to believe that the City of Lodi. California. had not complied, in all material respects, with those requirements. This report is intended for the information of the City Council. management and the U.S. Department of Housing and Urban Development. This restriction is not intended to limit the distribution of this report. which is a matter of public record. November 9. 1992 -9- M - 0% W4 Peat Marwick Corithad Public Accountants 2495 Na,omd5 Far: 7r �io Sacran�ntc _ (A 95833 2936 INDEPENDENT AUDITORS' REPORT ON THE INTERNAL CONTROL STRUCTURE USED IN ADMINISTERING FEDERAL FINANCIAL ASSISTANCE PROGRAMS - MAJOR PROGRAM LESS THA` 50 PERCENT OF TOTAL- E. NDITUt The Honorable Members of City Council City of Lodi. California: ``t We have audited the general purpose tinattcial statements of City of Lodi. California. as of and for the year ended June 30. 1992, and have issued our report thereon dated November 9. 1992. We have also audited City of Lodi. California's compliance with requirements applicable to a major federal financial assistance program and have issued our report thereon dated November 6. 1992. We conducted our audits in accordance with generally accepted auditing standards: Government Auditing Standards. issued by the Comptroller General of the United States. and Office of Management and Budget (OMB) Circular A-128. Audits of State and Local Govern e Is. se standards and OMB Circular A-128 require that we plan and perform the audit to obtain reasonable assurance about whether the general purpose financial statements are free of material misstatement and about whether City of Lodi. California. complied with laws and regulations. noncompliance with which would be material to a major federal financial assistance program. In planning and performing our audit for the year ended June 30. 1992. we considered the City's internal control structure in order to determine our auditing procedures for the purpose of expressing our opinions on the City's general purpose financial statements and on its compliance with requirements applicable to a major program and not to provide assurance on the internal control structure;. This report addresses our consideration of internal control structure policies and procedures relevant to compliance with requirements applicable to federal financial assistance programs. We have addressed policies and procedures relevant to our audit of the general purpose financial statements in a separate report dated November 9. 1992. The management of City of Lodi. California is responsible for establishing and maintaining an internal control structure. In fulfilling this responsibility. estimates and judgments by management are required to assess the expected benefits and related costs of internal control structure policies and procedures. The objectives of an internal control structure are to provide management with reasonable. but not absolute, assurance that assets are safeguarded against loss from unauthorized use or disposition. that transactions are executed in accordance with generally acceptei accounting principles. and that federal financial assistance programs are managed in compliance with applicable laws and regulations. Because of inherent limitations in any internal control structure, errors. irregularities, or instances of noncompliance may nevertheless occur and not be detected. Also. projection of any evaluation of the structure to future periods is subject to the risk that procedures may become inadequate because of changes in conditions or that the effectiveness of the design and operation of policies and prrxedures may deteriorate. i W !h For the purpose of this report, we have classified the significant internal control structure policies and procedures used in administering federal financial assistance programs in the following categories: Accounting Controls - Expenditures and disbursements. Political activity: - Davis -Bacon Act. - Civil rights: - Cash management: - Relocation assistance and real property acquisition: - Federal financial reports: • - Allowable costs/cost principles: - Drug -Free Workplace Act. and - Administrative requirements. Specific Requirements - - Types of services; - Eligibility: - Matching levels of effort, or earmarking requirements: - Reporting. - Special requirements. if any; - Cost allocation: and - Monitoring Subrecipients. For all of the internal control structure categories listed above. we obtained an understanding of the design of relevant policies and procedures and determined whether they have been placed in operation. and we assessed control risk. During the year ended lune 30. 1992. City of Lodi. California. expended 80 percent of its total federal financial assistance under a major federal financial assistance program and the following nonmajor federal financial assistance program: Federal Urban Aid. We performed tests of controls, as required by OMB Circular A-128. to evaluate the effectiveness of the design and operation of internal control structure policies and procedures that we considered relevant to preventing or detecting material noncompliance with specific requirements. general requirements. and requirements governing claims for advances and reimbursements. and amounts claimed or used for matching that are applicable to the City's major federal financial assistance program which is identified in the accompanying Schedule of Federal Financial assistance. and the aforementioned nonmajar program. Our procedures were less in scope than would be necessary to render an opinion on these internal control structure policies and procedures. Accordingly. we do not express such an opinion. Our consideration of the internal control structure would not necessarily disclose all matters in the internal control structure that might be naterial weaknesses under standards established by the American Institute of Certified Public Accountants. A material weakness is a reportable condition in which the design or operation of one or more of the specific internal control structure elements 4% does not reduce to a relatively low level the risk that noncompliance with laws and regulations that would be material in relation to a federal financial assistance program may occur and not be detected within a timely period by employees in the normal course of performing their assigned functions. We noted no maters involving the internal control structure and its operation that we consider to be material weaknesses as defined above. r We also noted other matters involving the internal control structure and its operation that we have reported to the management of City of Lodi. California in a separate letter dated November 9. 1992. This report is intended for the information of the City Council. management. and the U.S. Department of Housing and Urban Development. 'This restriction is not intended to limit the r� distribution of this report. which is a matter of public record. November 9. 1992 -12- r. CITY OF LODI. CALIFORNIA Status of Prior Year Findings and Recommendations Year Ended June 30. 1992 Finding: The City does not have a formal policy in place to mccl all the requirements of the Drug -Free Workplace Act. Recommendation: The City should develop a comprehensive and formal drug-free policy that meets the requirements of the Drug -Free Workplace Act A copy of the policy statement should be ., given to all employees. Current: The City developed a comprehensive and formal drug-free policy that meets the requirements of the Drug -Free Workplace Act. This policy was approved by the City Council on November 22. 1991. A copy of this policy was distributed to all employees on November 27. 1991. All new employees receive a copy of the policy during orientation. REPORT NG Finding: The amount of expenditures reflected in the schedule of federal financial assistance for Community Development Block Grants. 1988-1989 program year. does not agree by $107.28 - with the Summary of Community Development Block Grants Financial Status Report file with the U.S. Department of Housing and Urban Development. Recommendation: The City should develop controls to ensure that expenditures reflected in the books and records are in agreement with reports tiled with the U.S. Department of Housing and Urban Development Current Status: The City has procedures to ensure that expenditures reflected in the accounting records correspond with the reports with the U.S. Department of Housing and Urban Development. All grant monies. with the exception of the Housing Rehabilitation Program. are reconciled on a monthly basis by the City's accountant- -13- CITY OF LODI, CALIFORNIA COMPREHENSIVE ANNUAL FINANCIAL REPORT Fiscal Year Ended June 30, 1992 JAMES W. PINKERTON, JR., MAYOR PHILLIP PENNING, MAYOR PRO TEMP DAVID M, HINCHMAN, COUNCIL MEMBER JACK A. SIEGLOCK, COUNCIL MEMBER JOHN R.'RANDY' SNIDER, COUNCIL MEMBER THOMAS A. PETERSON, CITY MANAGER Prepared by the Department of Finance Dixon Flynn, Finance Director/Treasurer Vicky McAthie, Accounting Manager TABLE OF CONTENTS Pag PREFACE i INTRODUCTION Transmittal Memorandum iv Organization of the City of Lodi xiv Directory of Officials and Advisory Bodies xv FINANCIAL REPORTS GENERAL PURPOSE FINANCIAL STATEMENTS Independent Auditor's Report I Combined Balance Sheet — All Fund Types and Account Groups 2 Combined Statement of Revenues, Expenditures and Changes in Fund Balances All Governmental Fund Types and Expendable Trust Funds 4 Statement of Revenues, Expenditures, and Changes in Fund Balances Budget and Actual — General and Special Revenue Funds 5 Combined Statement of Revenues, Expenses and Changes in Retained Earnings All Proprietary Fund Types 6 Combined Statement of Cash Flow — All Proprietary Fund Types 7 Notes to General Purpose Financial Statements 9 SUPPLEMENTAL FINANCIAL STATEMENTS General Fund Overview 36 Comparative Balance Sheet 37 Comparative Statement of Revenues, Expenditures and Changes in Fund Balance — Budget and Actual 38 Special Revenue Funds Overview 40 Combining Balance Sheet 41 Combining Statement of Revenues, Expenditures and Changes in Fund Balance 42 Comparative Statement of Revenues, Expenditures and Changes in Fund Balance — Budget and Actual 43 Debt Service Fund Overview 44 Comparative Balance Sheet 45 Comparative Statement of Revenues, Expenditures and Changes in Fund Balance 46 1 TABLE OF CONTENTS — continued a Capital Project Funds Overview 48 Combining Balance Sheet 49 Combining Statement of Revenues, Expenditures and Changes in Fund Balance 50 Enterprise Funds Overview 52 Combining Balance Sheet 53 Combining Statement of Revenues, Expenses and Changes in Retained Earnings 54 Combining Statement of Cash Flows 55 Internal Service Funds Overview 56 Comparative Balance Sheet 57 Comparative Statement of Revenues, Expenses and Changes in Retained Earnings 58 Trust and Agency Funds Overview 60 Combining Balance Sheet 61 Comparative Statement of Revenues, Expenditures and Changes in Fund Balance — Miscellaneous Expendable Trust Fund 62 Combining Statement of Changes in Assets and Liabilities — Agency Funds 63 General Fixed Assets and General Long—Term Debt Account Groups Overview 64 Comparative Schedule of 0eneral Long—Term Debt 65 Schedule of General Fixed Assets 66 STATISTICAL TABLES (unaudited) General Governmental Revenues by Source — Last Ten Years 68 General Governmental Expenditures by Function — Last Ten Years 69 General Governmental Tax Revenues by Source — Last Ten Years 70 Secured Tax Levies and Collection — Last Ten Years 71 Assessed Full Cash Value of all Taxable Property — Last Ten Years 72 Property Tax Rate Alt Overlapping Governments — Last Ten Years 73 Special Assessment Billings and Collections — Last Ten Years 74 Ratio of Net Geaenl Bonded Debt to Taxable Assessed Value and Net Bonded Debt Per Capita — Last Ten Years 75 Computation of Direct sad Overlapping Genesi Bonded Debt — June 30,1992 76 Computation of Legal Debt Margin — June 30,1992 77 TABLE OF CONTENTS — continued page STATISTICAL TABLES (unaudited)continued Ratio of Annual Debt Service Expenditures for General Bonded Debt to Total General Fund Expenditures — Last Ten Years 78 Revenue Bond Coverage — Last Ten Years 79 Demographic Statistics — Last Ten Years 80 Construction Activity — Last Ten Years 81 Bank Deposits — Last Ten Years 82 Principal Employers — June 30,1992 83 Surety Bonds of Principal Officials 84 Gann Appropriation Limitation — Last Ten Years 85 Authorized Personnel — Last Ten Years 86 �Mmw WI Q LL W cra PREFACE The Comprehensive Annual Financial Re ort CAFR has been prepa in order to resent the Cit of Lodi, California City monetary results of operations and P p( ) I P' p y (City) 1 financial condition as of June 30, 1992,as well as provide statistical information of general interest about the City. To achieve these goals, the City's CAFR was organized into the following three major sections: INTRODUCTION This section of the CAFR provides a comprehensive analysis of the City's financial position as of June 30, 1992 as well as summaries of significant policies and practices which affect the City's management of its financial affairs. The Introduction section also includes a directory of City officials and advisory bodies, and an organization chart of the City. FINANCIAL REPORTS This section includes the primary financial statements of the City, and is organized into three major areas: Independent Auditors' Report ' General purpose financial statements including notes which summarize the City's financial position and results of operation at the "Fund' level. • Supplemental financials satements,which provide financial information for each of the City's funds and account groups organized by generic fund type: Governmental Funds (General, Special Revenue, Capital Project, and Debt Service), Enterprise Funds, Fiduciary Funds, and General Fixed Assets and Genera! Long Term Debts. An overview introduces each of these supplemental financial statements which describes the purpose of each fund or account group. In accordance with generally accepted accounting principles, the City's financial reporting system is organized on a'fund* basis, which is described further on the following page of this Preface. STATISTICAL TABLES This section includes the following demographic and financial tables which provide current and historical trend information for the City, and is organized into four major areas: • Statistical overview • General financial trends of revenues, expenditures, property valuation and tax sources for the last ten years, • Long—term indebtedness trends and characteristics • Demographic and econornic base trends and characteristics PREFACE - CONTINUED The City's financial reporting system is organized on a *fund* basis consisting of three major fund types — Governmental, Proprietary, and Fiduciary — and two self—balancing Account Groups. The City's various funds as summarized below have been established in order to segregate and identify those financial transactions and resources associated with providing specific activities or programs in conformance with special regulations, restrictions or limitations. GOVERNMENTAL FUNDS Most of the City's programs and functions are provided and financed through the following Governmental Funds, which are distinguished by their measurement focus on determining financial position and changes in financial position, rather than upon determining net income: General Fund Debt Service Special Revenue Funds Capital Project Funds Asset Seizure Capital Outlay Gas Tax Equipment Replacement Transportation Partnership Act Subdivisions State Park Bonds Storm Drainage Development Impact Fee Funds Lodi Lake Capital Housing and Urban Development Transportation Development Act Federal Aid Urban PROPRIETARY FUNDS Proprietary funds are distinguished from Governmental funds by their similarity to private sector enterprises, as the intent is that the cost of providing services — whether this service is to the public (Enterprise Funds) or internally to the organization (Internal Service Funds) — is to be financed or recovered primarily through user charges. Enterprise Funds may also be established to account for operations under which the City or an outside granting agency has decided that a periodic determination of net income under full accrual accounting is appropriate for capital maintenance, public policy, management control, accountability, or other public purpose. The following three Enterprise Funds are used by the City: Electric, Sewer and Water. FIDUCIARY FUNDS Also known as Trust and Agency Funds, the following funds are used to account for assets by the City in a trustee capacity for private individuals, organizations, or other governmental agencies: Expendable Trust Funds Agency Funds Hutchins Street Square Special Assessments Industrial Way/Beckman Road Turncr/Cluff Deferred Compensation a ii a LL) a z O U D 0 O CC Z T - Z w 4 M CITY COUNCIL JAMES W. PINKERTON, Maya PHILLIP A. PENNING Mayor Pro Tempore DAVID M. HINCHMAN JACK A. SiEGLOCK JOHN R. (Randy) SNIDER November 23, 1992 MEMORANDUM TO: City Council FROM: Director of finance r �. .� YW « d .� • w w � -s, % is CITY OF LODI CITY HALL, 221 WEST PINE STREET PA. BOX 3006 LODI, CALIFORNIA 95241-1910 (209) 334-5634 FAX (M ))3&M5 THOMAS A. PETERSON Gly Manager ALICE M. REIMCHE city Clerk 808 MCNATT City Alforney S1JTIJECT: COMPREHENSIVE; ANNUAL FINANCIAL REPORT FOR FISCAL YR.AR 1991-92 OVERVIEiW The Comprehensive Annual Financial Report (CAFR) for Fiscal Year 1991-92 of the Cityof Lodi, California is hereby transmitted. The CAFR is prepared by the Finance Department in order to present the City's monetary results of operations and financial condition as of June 30,1992, as well as to provide statistical information of general interest about the City of Lodi. ne CAFR reflects the City's commitment to the highest standard of financial reporting by using a reporting format which meets the standards adopted by the Governmental Accounting Standards Board (GASB),which Is recognized as the authoritative body for establishing the standards of financial accounting and reporting with respect to activities and transactions of State and local governments. We believe that the data provided in this report is accurate in all material respects, and is presented in a manner designed to fairly reflect the financial position and results of operations of the City. In addition, we believe that all disclosures necessary to enable the reader to gain an understanding of the City's financial activities have been included. The responsibility for the accuracy of the data presented, as well as for the completeness and fairness of the presentation, including all disclosures, rests with the City. The comprehensive annual financial report Is presented In three sections: introductory, financial, and statistical. The introductory section includes this transmittal letter, the government's organizational chart and a list of principal officials. The financial section includes the general purpose flnancial statements and the combining and individual fund and account group financial statements and schedules, as well as the auditor's report on the financial statements and schedules. The statistical section includes selected financial and demographic information, generally presented on a multi—year basis. AA THE REPORTING ENTITY AND ITS SERVICES The funds and account groups included In the Comprehensive Annual Financial Report (CAFR) are those deemed dependent upon the City and controlled by the City Council. In accordance with the criteria established by the National Council of Governmental Accounting (NCGA), particularly on Statement 3, which took effect in the fiscal year 1982-83, the Lodi Public Improvement Corporation (LPIC) is merged Into into the City's general purpose financial statements as the City has oversight responsibility for this entity. Services Provided By the City of Lodi The City provides a wide range of municipal services, including police and fire protection, electrical, water and sewer utilities, street maintenance, public transportation, planning, building and safety, library services, parks and recreations services and other general government services. Several municipal services are provided through other government agencies, private companies or public utility companies, including the following: Elementaryand Secondary Schools..................................................................1 l Sanitation (solid waste) and Cable Television...................................................2 Gasand Telephone...............................................................................................2 Financial information for all funds through which services are provided by the City of Lodi have been Included in this report based on the criteria adopted by the GASB which is the authoritative body in establishing generally accepted accounting principles for local government. ECONOMIC CONDITION AND OUTLOOK Summary of the Local Economy The City of Lodi is located In the San Joaquin Valley between Stockton to the south and Sacramento to the north and adjacent to U.S. Highway 99. The City has a population of 53,000 contained in 11 square miles, with an assessed value of 52,203,351,420. The City has grown steadily since incorporation in 1906. Even with stringent growth control measures, approximately 518 new residential units are constructed each year. In 1989, the California Appellate Court found the City's initiative growth control ordinance to be illegal. Subsequently, the City Council adopted a growth control ordinance which allows a 2% increase in population each year. It is anticipate 1 that build out will occur in the year 2007 and that the City's population will be 70,500. Retail trade and industry are the economic base of Lodi. However, many of the newer residents commute out of the area for employment. The major employers in the City are General Mills, Lodi Memorial Hospital, Farmers and Merchants Bank, Lodi Unified School District, Interlake, Pacific Coast Producers and the City government. The economic condition of the City is clearly dependent on how the National and State economies perform over the next several months. In addition to the National and State economies that clearly affect Lodi, the effort made by other local cities to increase their share of the retail sales market and to attract industrywill also have a significant effect on the performance of the economy in Lodi. It the competitive environment between cities to increase market share continues, Lodi may experience a loss of revenues even if the overall local economy is performing well. Accordingly, Lodi is making an effort to create a positive environment for business and industry. Wal—mart, a major retailer, opened a store in Lodi in 1992. In addition, the City is working with the Chamber of Commerce and other business groups to promote economic growth and retain those businesses which have been a foundation to the economic health of the City. MAJOR INITIATIVES The City has several accomplishments during the year which should be noted. A Growth Management Plan was adopted and the City annexed approximately 300 additional acres to allow for residential growth and development. Wal—Mart and Orchard Supply began construction of a new retail shopping center that will increase sales tax revenue for the City. Electric Utility continued the wood pole testing and change out, developed the low—voltage portion of the sub—station to allow for industrial development of the east side of Lodi, completed negotiations with PG&E for anew Interconnection agreement and initiated a tont of services study. Public Works adopted new development Impact fees to allow for anticipated future growth of the City and necessary infrastructure. Sewer plant upgrades were completed and Initial work has been done to remove DBCP from the City's water supply and to meet State and Federal water standards. Recreation made several improvements to playgrounds and parks throughout the City. new phygrourd equipment was installed, picnic tables and restwxxns added. In addition, a wilderness tour was added to the recreation programs at Lodi lake Park. During 1991-42, the City completed a 'Cont of Scnices Study' and 'Fee Study' for future use in reducing service costs and recommending new fees. An audit was conttucted of the City businesses to determine if they arc correctly reporting sales tax. As a result of the audit, the City pined appr.uimately $15X100 in auditional revenues. Many of the ideas from the study are being considered at this time for implementation. The Accounting section of the FirwiKe Department put in countless hours coordinating research on out fired assets to eliminate the hem that resulted in a qualified audit opinion in prior years. The combined efforts of the Accountingsection. Public Works, Community Development, and Electric Utility departments in addhun to the valued input from KPMG Peat Marwick are greatly appremied. These are but a few of the many accomplishments during the year for which the City taq take some pride. However, there b one accomplishment whkh any not be significant to the public but impurtant to the Staff which should be noted. T1te City finadited the purchase of property wkick will alluo dtm the development of the Civic Center. Thi+ purchase marked the end of 23 years of on—apht, oft—,pia negotirattitrrts_ FINANCIAL INFORMATION, MANAGEMENT. AND CONTROL A detailed understanding of the financial position and operating results of the City b pt v" in the CAFR. Preicated bikes b a bract descripips W f rsaacal information, management of fivaacisl resources and obiiptlom, and control tech ecs. applicable to fisamdai tewerccs. osligalk o, aad irfarmaalaw Basis of Accounting Basis of acctwatiag refers towhta ra,vtattes and eWailhatts of expenses art tecoplted In the sc mMe sad repttned in tits fdaasrial feawMats. AB gmernmeataf reads and eapest!" triol tomb an aaaamaed for vsbS tits ma"lad seen al lass of seweatfrtg. Theft tmoses see max wc4.thea They become ataasw*k UM arallab& Egtadlt %rat an pund y tseoplood WAW tin trratdkd ace W Stasis of aecousting 'mks the retested fund inability Is lncurted. AN proprietary ftsatb and NostrW allable Tttssl Fried, sad ha acts Trust FwWs are amxtasaard finer win at amwal Mawr of accounting. Their mesa" an naeogtticed when they ate earned, std their espenaes err rs as d .Ma they ars irstwted. H 1 Account System and Budgetary Control The City's accounting records for general governmental operations are maintained on a modified accrual basis; with revenues recorded when available and measurable, and expenditures recorded when the services or goods arc received and the liability incurred. For proprietary fund types, the City uses the accrual basis of accounting. As such, the measurement focus is on net income in addition to financial position and changes in financial position, revenues are recognized when earned and expenses are recognized as the liability is incurred. We believe that the City's internal accounting controls adequately safeguard assets and provide reasonable assurance of proper recording of financial transactions. In developing the City's accounting system, consideration is given to the adequacy of internal accounting control. The objective of the City's internal accounting controls are to provide reasonable, but not absolute, assurance that assets are safeguarded against loss from unauthorized use or disposition, and to ensure that transactions arc properly recorded to permit the preparation of financial statements in accordance with generally accepted accounting principles. The concept of reasonable assurance recognizes that the cost of control should not exceed the benefits likely to be derived, and that estimates and judgements arc required to be made by management in evaluating these costs and benefits, In addition, the government maintains budgetary controls. The objective of these controls is to ensure compliance with legal provisions embodied in the annual appropriated budget approved by the government's governing body. Budgets are adopted annually by the City Council by resolution and prepared for each fund in accordance with its basis of accounting. The City Manager i5 responsible for preparing the budget and for its implementation after adoption. The City Council has the authority to amend the budget at any time during the fiscal year. The City Manager has the authority to make adjustments to the budget as long as those changes will not have a significant policy impact nor affect budgeted year end balances. During the fiscal year 1991-92, several supplemental budget approprialions were made. Expenditure and budgeting detail is maintained by the City for each fund and department by division at the line item level. Budgetarycontrol is exercised through an online computerized system which is integrated with the City's general ledger. The system maintains an ongoing record of budget balances throughout the year based on actual expenditures and unfilled purchase orders. Open encumbrances at year end are reported as reservations of fund balance. Fund Balance It is the City's policy to maintain an unreserved fund balance in the General Fund (and working capital balances of the Electric, Water and Sewer Enterprise funds) of at least two months of operating expenditures. This goal was not achieved in fiscal year 1991-92. The Generdl Fund has less than one month of unreserved fund balance; whereas, the enterprise funds have achieved the City's goal. Cash Management The City haswritten investment policies which address a wide varietyof investment practices, including primary investment objectives, investment authority, allowable investment vehicles, investment maturity_terms, eligible financial institutions, capital preservation, and cash now management. Under the City's policies, investments in the City's portfolio are intended to be held until maturity, and accordingly, Investment terms are selected for consistency with the City's cash flow needs. Reports are issued monthly to the City Manager and City Council providing detailed information regarding the City's investments and compliance with City policy. Under the City's investment policies, the City's primary objective is to achieve a reasonable rate of return on public funds while minimizing risks and preserving capital. In evaluating the performance of the City's portfolio in achieving this objective, it is expected that yields on City investments will regularly meet or exceed the average return on three month U.S. Treasury Bills. vii Expenditure Limitation Article X111 B of the Constitution of the State of California (Proposition 9) provides for the limitation of expenditures by state and local governments. Under these provisions, City appropriations funded through tax sources may not exceed Fiscal year 1979 appropriation levels except as adjusted for increases in population and the cost of living. Excluded from this limitation are appropriations funded through charges for services, fines and forfeitures, grants, transfers of service responsibilities between governmental agencies, and indebtedness incurred prior to Fiscal year 1979. Pursuant to subsequent State legislation adopted after the passage of Proposition 9, the City is required to annually establish and adopt its appropriations limit by resolution. For 1991-92, the City's appropriations subject to limitations were $33,441,797 compared to actual appropriations subject to limitation of $22,048,696, a favorable variance of S11,393.101. Debt Administration The ratio of net general bonded debt to assessed valuation and the amount of bonded debt per capita are useful indicators of the City's debt position to municipal management, citizens, and investors. These data for the City at the end of fiscal year 1992 were as follows: Percent of Net Bonded Debt to Debt Per Amount Assessed Full Cash Value CaRa Net Direct Bonded Debt $1,205 0.0588°Jo 522.74 At June 30, 1992, the City had outstanding general obligation bonds of $1,205,000, special assessment bonds of S245,0fX1 and Certificates of Participation of SI 1,170,0(10. These liabilities are discussed in Note 7 to the General Purpose Financial Statements. The City's debt management policy includes a committment to monitor all forms of debt annually consistent with the City's Financial Plan and Budget preparation and review process. Also, the City will generally conduct financings on a competitive basis, will seek an investment grade rating on any direct debt, and will seek credit enhancements such as tetters ofcreditor insurance when necessary for marketing purposes, availability, and cost effectiveness. Interim Financial Reporting Interim financial reports are prepared monthly using a "pyramid" approach in presenting varying levels of detail. Under this approach, the highest level of summary data is presented first, followed by progressively greater levels of detail. Detailed reports provide information regarding revenues and expenditures for all program areas by line item, including year to date estimates and monthly actuals,encumbrances, and budget variance. Single Audit The City is subject to the financial and compliance reporting requirements of the Single Audit Act of 1983,which is applicable to all local and state governments receiving federal financial assistance. As part of the City's single audit, tests are made to determine the adequacy of the internal controls, including that portion related to federal financial assistance, as well as to determine that the City has complied with applicable laws and regulations. The results of the City's single audit for the fiscal year ended June 30, 1992 provided no instances of material weaknesses in the internal control structure or significant violations of applicable laws and regulations. viii Competitive Bidding Policy City purchases for materials, equipment, and services during fiscal year 1991-92 were made pursuant to competitive bidding procedures as established under City purchasing ordinances. Contracts for construction projects are awarded pursuant to the competitive bidding requirements established by the State of California for projects in excess of $5,000. Risk Management The City government is currently self—insured for dental insurance, worker's compensation, general liability and unemployment insurance. General liability and worker's compensation are administered by an outside agency, the other programs are administered by the City. Self—insured transactions are accounted for in the Internal Service Fund. FINANCIAL HIGHLIGHTS As demonstrated by the statements and schedules included in the financial section of this report, the City continues to meet its responsibility for managing the financial resources of the City. General Government Functions The follcnving schedule presents a summaryof the general fund, special revenue funds, capital outlay funds and debt service fund revenues for the fiscal year ended June 30, 1992 and the amount of increases and decreases in relation to prior year revenues. REVENUES 1992 1991 Variance Variance Amount % of Total Amount %o of Total By Amount By Percent Taxes 511,555,645 46.25% $10,800,485 48.10% 5755,160 6.99% Licenses and Permits 420,249 1.68% 367,309 1.64% 52,940 14.41% Fines, Forfeitures and Penalties 251,581 1.01% 340,891 1.52% (89,310) —26.201X Use of Money and Property 1,385,598 5.55% 1,407,569 6.27% (21,971) —1.56% Subventions and Grants 5,214,472 20.87% 4,134,008 18.4190 1,080,464 26.14% Charges for services S,0021988 20.02% 4,062,086 18.09% 940,902 23.16% Other revenues 1,157,092 4.63% 1,341,696 5.98% (184,604) —13.76% TOTAL 524,987625 100.00% $22,454,044 100.00% $2,533,581 11.28% Governmental revenues for Fiscal Year 1991-92 in the amount of S24,987,625 reflects an increase of S2,533,581 from 1991 revenues due to Measure K tax revenues Subventions and Grants; and, Charges for services. These increases were offset in part by a decrease in fines, forfeitures and penalties; use of money and property; and, other revenues. ix The following schedule presents a summary of general fund, special revenue funds, capital outlay funds and debt service expenditures for the Fiscal year ended June 30, 1992 and the increases and decreases in relation to prior year amounts. EXPENDITURES 1992 1991 By Amount Variance Variance Amount %of Total Amount % of Total By Amount By Percent Public Safety S9,903,079 37.66% $9,141,249 37.33% 5761,830 8.33% Public Works 4,203,727 15.98% 4,300,628 17.56% (96,901) -2.25% Sanitation 3,425,301 13.02% 3,449,491 14.09% (24,190) -0.7Me Library 948,941 3.61% 903,940 3.69% 45,001 4.9817c, Parks and Recreation 2,631,593 10.01% 2,484,631 10.15% 146,962 5.91%; General Government _ 5,186,392 19.72% 4,209,361 17.19% 977,031 23.21% $26,299,033 100.00% $24,489,300 100.00% $1,809,733 7.39% Capital Outlays 1,512,775 1,247,317 265,458 21.28%x, Debt Service 394,214 406,094 (11,880) -2.93%n TOTAL $28,206,022 $26,142,711 _ S2,063 11 7.89% The Governmental expenditures increased overall by 7.8976 from Fiscal Year 1990-91. The major increase was in General Government Utilities and Communications due to the installation of a new telephone system and a fire radio system. The following schedule presents a summary of general fund, special revenue funds, capital outlay fund and debt service expenditures for the Fiscal year ended June 30,1992 by object code and the increases and decreases in relation to prior year amounts. EXPENDITURES BY OBJECT CODE 1992 1991 Variance Variance Personel services Supplies, Materials and Services Utilities and Communications Equipment, Land and Structures Other TOTAL Amount % of Total By Amount By Percent $17,404,125 61.70% 4,358,147 15.45% 1,267,514 4.49% 2,877,129 10.20% 2,299,107 8.15% S28,206,022 100.00% S314,432 32.99% 2,531,508 x Amount % of Total By Amount By Percent S16,022,702 61.29% $1,381,423 8.62% 4,187,014 16.02% S171,133 4.09% 953,082 3.65% S314,432 32.99% 2,531,508 9.68% S345,621 13.65% 2,448,405 9.37% ($149,298) -6.10% S26,142,711 100.00% S2t063,311 7.89% Enterprise Operations Fiscal Year 1991-92 revenues for enterprise fund activities totaled 541,920,121, an Increase of 12.35% from fiscal year 1990-91. Revenues from various sources and the change from last year are as follows: REVENUES 1992 Amount % of Total Charges for services S40,664,101 97.00% Sewer bond tax revenue 177,221 0.42% Rent income 241,013 0.57% Interest revenue, net 85,973 0.21% Other revenue 751,813 1.79% TOTAL $41,920,121 100.00% 1991 1992 Variance Variance Amount %of Total By Amount By Percent Amount % of Total $35,454,700 95.02% $5,209,401 14.69% 180,021 0.48% (2,800) -1.56% 202,689 0.54% 38,324 18.91%n 743,853 1.99% (657,880) -88.44% 730,450 1.96% 21,363 2.92% $37,311,713 100.00% S4 608,408 12.35% Expenses for enterprise fund operations totaled $37,385,752, an increase of 11.04% from fiscal year 1990-91. Charges in levels of expenses for major functions of service fund operations from the preceding year are shown in the following comparison: EXPENSES 1992 1991 Variance Variance Amount % of Total Amount % of Total By Amount By Percent Personal services 54,054,761 10.85% S3,548,119 10.54% $506,642 14.28% Supplies, materials, and services 3,760,126 10.06% 3,090,607 9.18% 669,519 21.66% Utilities and communications 27,564,372 73.73% 25,090,615 74.52% 2,473,757 9.86% Depreciation 1,986,203 5.31% 1,919,960 5.70% 66,243 3.45% Benefit payments 20,290 0.05% 18,958 0.06% 1,332 7.03% TOTAL 53 385=752 100.00°U 533,668259 100.000% 53,717,493 11.04% Internal Service Activities Fiscal Year 1991-92 revenues for internal service fund activities totaled $1,157,173, an increase of 8.0% from fiscal year 1990-91. Revenues from various sources and the change from last year are as follows: REVENUES During Fiscal Year 1991-92, Internal Service Fund revenues increased $85,708 (8.0%) compared with the prior year. The decrease in interest revenue offset the ether revenue (PL and PD fund refund) increase. Expenses for internal service fund operations totaled $1,996,766, an increase of 90.89% from Fiscal year 1990-91. The addition of a Risk Management section accounts for the increase in personal service charges and for a portion of the increase in supplies, materials and services. Increases in the self insurance reserves account for the remainder of the increase in the services category, Charges in levels of expenses for major functions of service fund operations from the preceding year are shown in the following comparison: EXPENSES 1992 1991 Variance Variance Amount % of Total Amount % of Total By Amount By Percent Charges for services $881,196 76.15% $851,558 79.48% $29,638 3.48% Interest Revenue 126,601 10.94% 147,188 13.74% (20,587) —13.99%, Other revenue 149,376 12.91% 72,719 _ 6.79% 76^657 105.41% TOTAL $1,157,173 100.00% $1,071,465 100.00% _ $85,708 8.00% During Fiscal Year 1991-92, Internal Service Fund revenues increased $85,708 (8.0%) compared with the prior year. The decrease in interest revenue offset the ether revenue (PL and PD fund refund) increase. Expenses for internal service fund operations totaled $1,996,766, an increase of 90.89% from Fiscal year 1990-91. The addition of a Risk Management section accounts for the increase in personal service charges and for a portion of the increase in supplies, materials and services. Increases in the self insurance reserves account for the remainder of the increase in the services category, Charges in levels of expenses for major functions of service fund operations from the preceding year are shown in the following comparison: EXPENSES Fiduciary Fund Operations The City maintains expendable and Agency Funds. Expendable Trust Fund accounts for and administer funds for the Hutchins Street Square Bequest trust. Agency Funds account for and administer funds for the Deferred Compensation, United Downtown Improvement District and Special Assessment funds. xii W 1992 1991 Variance Variance _ Amount % of Total Amount % of Total By Amount By Percent Personal services $133,032 6.66% 581,940 7.83% 551,092 62.35%: Supplies, materials, and services 1,569,564 78.61% 700,907 67.01% 868,657 123.93% Benefit payments 294,170 14.73% 263,174 25.16% 30,996 11.78% TOTAL $1,996,766 100.000/0 S1,046,021 100.00% S950,745 90.89% Fiduciary Fund Operations The City maintains expendable and Agency Funds. Expendable Trust Fund accounts for and administer funds for the Hutchins Street Square Bequest trust. Agency Funds account for and administer funds for the Deferred Compensation, United Downtown Improvement District and Special Assessment funds. xii W 1 INDEPENDENT AUDIT The City Council requires an annual audit of the records and accounts of the City by an independent certified public accountant. 'lite accounting firm of KPMG Peat Marwick was selected to perform this audit. The auditor's report on the general purpose financial statements and combining individual fund statements and schedules, which is included in the financial section of this report, reflects that the financial records, reports and internal controls of the City are in conformance with 'generally accepted accounting principles`. ACKNOWLEDGEMENTS The preparation and development of this report on a timely basis could not be accomplished without the efficient and dedicated services of the entire staff of the Finance Department. 1 would like to express my appreciation to all members of the Department who assisted and contributed to its preparation, especially the Accounting staff whose extra effort and attention to detail have made this report a product in which the City can take special pride. I would also like to thank the City Council and the City Manager for their interest and support in planning and conducting the financial operations of the City in a responsible and progressive manner. Respectfully submitted, Dixon Flynn Finance Director CITY OF LODI ""y DIRECTORY OF OFFICIALS AND ADVISORY BODIES CITY COUNCIL James W. Pinkerton, Jr., Mayor Phillip Pennino, Mayor Pro Temp David M. Hinchman, Council Member Jack A. Sieglock, Council Member John R. "Randy" Snider, Council Member ADVISORY BODIES Library Systems Advisory Board Personnel Board of Review Council of Governments (COG) Citizens Advisory Committee Planning Commission Library Board Recreation Commission Lodi Ad Hoc Transportation Committee Site Plan and Architectural Review Committee Lodi Arts Commission Lodi Solid Waste Management Task Force Lodi Senior Citizen's Commission Old Lodi Union High School Site Foundation Board PRINCIPAL ADMINISTRATIVE OFFICERS Thomas A. Peterson City Manager Jerry Glenn Assistant City Manager Bob Me Natt City Attorney Alice Reimche City Clerk Kathleen Andrade Librarian H. Dixon Flynn Finance Director/Treasurer Larry Hughes Fire Chief Charlene Lange Community Center Director Joanne Narloch Personnel Director Jack Ronsko Public Works Director Henry Rice Electric Utility Director James Schroeder Community Development Director Floyd Williams Police Chief r Ron Williamson Parks & Recreation Director i FINANCIAL REPORTS GENERAL PURPOSE FINANCIAL STATEMENTS FINANCIAL REPORTS GENERAL PURPOSE FINANCIAL STATEMENTS KPMG) Peat Marwick Certified Pubic Accountants 2495 Natomas Park Drive Sacramento, CA 95833 2936 Independent Auditors' Report The Honorable Members of City Council City of Lodi, California We have audited tl•: general purpose financial statements of the City of Lodi, Califomia, as of and for the year ended June 30, 1992, as listed in the accompanying table of contents. These general purpose financial statements are the responsibility of the City's management. Our responsibility is to expiress an opinion on these general purr"e financial statements based on our audit. We conducted our audit in accordance with generally accepted auditing standards. Those standards rewire that we plan and perform the audit to obtain reasonable assurance about whether the general purpose financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supponing the amounts and disclosures in the general purpose financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation, We believe that our audit provides a reasonable basis for our op pion, In our opinion, the general purpose financial statements referred to above present fairly, in all material respects, the financial position of the City of Lodi. California, as of June 30, 1992, and the results of its operations and the cash flows of its proprietary fund types for the year then ended in conformity with generally accepted accounting principles. Our audit was made for the purpose of forming an opinion on the general purpose financial statements taken as a whole. The combining, individual fund and individual account group financial statennents listed in the accompanying table of contents are presented for purposes of additional analysis and are not a required part of the general purpose financial statements of the City of Lodi, California. Such information has been subjected to the auditing procedures applied in the audit of the general purpose financial statements and, in our opinion, is fairly stated in all material respects in relation to the general purpose financial statements taken as a whole. The information contained in the statistical sectionitgc not been subjected to the auditing procedures applied in the examination of the general purpose financial statements and, accordingly, we express no opinion thereon. As discussed in Noe 6 to the general purpose financial statements, the City changed its method of accounting for general and proprietary fund fixed assets. Sacramen(o, California November 9, 1992 L M~ km of e"4Wii1 q,nsNa Wu Maewd po�rhw )L PYIA G �W'r ia---^� 61-. . See accompanying notes to 6eoeral purpose fwndal sla6eatemts, (ecntioutd as reit pats) 2 1 CITY OF LODI Combined Ralays Sbeet - All Fund Types A04 Aeeount Group Just 30. 1992 Fiduciary Governmental Fund Type Proprietary Fund Tr ep Fund Iya _ Aen+unt Grote n _ Gefrnl General special Debt Capital Internal Trustand Fuld Long -Term Total General Revenue service Projects Enterprise Service Agency _ AtrIs Deb _ LMrmorandum O"�j Assets Cash and imrostmenu (note?) f 2374.760 1.741,155 272,799 ).996.256 10.102.)11 1.930,693 6,773.632 S :9,152,0!6 Receivables (net of allooances for incollyd ibles ): 666.955 79.756 2,265,069 1,192 Accounts 346,459 59.396 Property Taxes (note J) 39,396 25,(aq Special Assessments 2S•000 4,25).07) - Water Loan (notes) 1,.v37.07) 160.500 Loans Rcceinbk ) )1,091 632 160.300 1.067 1SS.6bo 27,190 5,481 302.136 Interest b0,17S . Due from other funds of gaernmental 2,365.963 agencies (role 6) 1.056,136 147,229 161,639 996,161 1,660,269 Iterventory 102,773 1,777,516 277,7)2 Deferred finsnoin6 coots 271,732 Other assets 23.716 71,609 10,206 132,060 44,051.395 91.773,179 Fixed assets 41,122.064 Amount to be collected lot payment 2,732,659 2,732,659 of compensated ab6enees Amounts to be Provided for capitalized 441,5)4 441,574 Late obligations (note 7) Amounts to be provided from general lan,o+) 1.211,041 obligation bonds (note 7) Amounts available for debt service for special assessment district bonds s+iN 277.06t _ !33.065 governmental eommitment(note 7) _ 28,620,0)9 36,4)1_ 4.419,442 61 )6662 3 2.090,7/7 6,7504-65 44,051,)95_ �_ 46)6299 _.,•.� ��-� S �t_3616.1 _-�-- !14 Total assets f >_ 4,047,715_ �. _ See accompanying notes to 6eoeral purpose fwndal sla6eatemts, (ecntioutd as reit pats) 2 1 f «!f|«■«!£ !|-Z � £ k, �(§k < F�2!!kzle !r 2 E � , �■ #»§/ f , ' �" �® '. , ;■ }$ : , ; i ! ■ � ' ! ! � ■ � � } � | ! 2 1 %■��� �■ E'ER :! � ! � - ■ | « ■ f | �/ ! ■ � f t � � } . § � � !f # � § § ■ « . - \k $ �k.�|i|�7(; !•`| } k� � i � � /\21 . �1 » $%7#f■{ § k!p##$� �\ � g! r R ■ . !n\/ !15 k/- �{ ƒƒ L6 22 � ■� � i ! � i� / k � — f� � 2� f . 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E E 2 � � 7 2 � i - ! 2§� ! ■ �■ -�7 §�;@« ■ ■ . ! )k� ■ ■� ' .-, ! ■ � - � |_�' �.|!all.`.:;l;!- |�■l.••...,...... IL |i§ t: ' ; !. ) ■ ;�■ ,; t � ! k -,r X u 0-C ! ! ! ) k � � a CITY OF LODI Notes to General Purpose Financial Statements (1) Summary of Significant Accounting Policies The City of Lodi, California, (City) was incorporated December b, 1906,as a municipal corporation under the general laws of State of California. The City operates under the Council—Manager form of government and provides the following services as authorized by its charter: general government, public works, public protection, sanitation, library, and parks and recreation. The accounting policies of the City of Lodi, California, conform to generally accepted accounting principles as applicable to governmental units. The following is a summary of the more significant policies: (a) Reporting Entity The City's general purpose financial statements include the operations of all organizations for which the City Council exercises oversight responsibility. Oversight responsibility is demonstrated by financial interdependency, selection of governing authority, designation of management, ability to significantly influence operations, and accountability for fiscal matters. Based on the aforementioned oversight criteria, the Lodi Public Improvement Corporation (LPIC) is included in the Enterprise Sewer Fund as the City has oversight responsibility for this entity. (b) Basis of Presentation — Fund Accounting The accounts of the City are organized on the basis of funds and account groups, 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 balance/ retained earnings, revenues, and expenditures/expenses. The various funds are summarized by type in the general purpose financial statements. The following fund types and account groups are used by the City: Governmental Fund Types Governmental funds are those throughwhich most governmental functions of the City are financed. The acquisition, use, and balances of the City's expendable financial resources and the related liabilities (except those accounted for in proprietary funds) are accounted for 9 1 CITY OF LGDI Notes to General Purpose Financial Statements through governmental funds. The measurement focus is upon determination of changes in financial position, rather than upon net income determination. The following are the City's governmental fund types: General Fund: The General Fund is the general operating fund of the City. It is used to account for all financial resources except those required to be accounted for in another fund. Special Revenue Funds: Special Revenue Funds are used to account for the proceeds of specific revenue sources (other than special assessments, expendable trusts, or major capital projec(s) that are legally restricted to expenditures for specified purposes. Debt Service Fund: The Debt Service Fund is used to account for the accumulation of resources for, and the payment of, general long—term debt principal, interest, and related costs. Capital Projects Fund: The Capital Projects Fund is used to account for financial resources to be used for the acquisition or construction of major capital facilities (other than those financed by proprietary funds and trust funds). Proprietary Fund Types Proprietary Funds are used to account for the City's on—going organizations and activities which are similar to those often found in the private sector. The measurement focus b upon determination of net income and capital maintenance. The following are the City's proprietary fund types: Enterprise Fundt Enterprise Funds are used to account for operations (a) that are financed and operated in a manner similar to private business enterprises — where the intent is that the costs (expenses, including depreciation) of providing goods or services are recorded primarily through user charges; or (b) where the governing body has decided that periodic determination of net income is appropriate for capital maintenance, public policy, management control, accountability, or other purposes. 10 CITY OF LODI Notes to General Purpose Financial Statements i 1 I 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, or to other governmental units, on a cost— reimbursement basis. Fiduciary Fund Tvpc Fiduciary Funds are used to account for assets held by the City in a trustee capacity or as an agent for individuals, private organizations, other governmental units, and/or funds. Agency Funds: Agency funds are used principally to account for collection of bond proceeds with no governmental obligation and payment of related bond principal and interest. Agency funds are custodial in nature and do not involve measurement of results of operation. Ex ep ndabie Trust Fund: Expendable Trust Funds used principally to account for funds held by the governmental unit in a trustee capacity for individuals, private organizations, other governmental units, and/or other funds. Account Grows Account groups are used to establish accounting control and accountability for the City's general fixed assets and general long—term debt. The following are the City's account groups: General Fixed Assets Account Groups This group of accounts is established to accoui:t for fixed assets of the City, other than those accounted for In the proprietary funds and trust funds. General Lour -Term Debt Account Grouter: This group of accounts is established to account for all long—term obligations of the City except those accounted for in the proprietary funds and trust funds. 11 CITY OF LODI Notes to General Purpose Financial Statements (c) Basis of Accounting Governmental and Fiduciary fund types use the modified accrual basis of accounting and current financial resources measurement focus. Under this basis of accounting, revenues arc recorded when they become both measurable and available to pay liabilities of the current period. Revenues not considered available are recorded as deferred revenues. Expenditures are recorded when the liability is incurred, except for (1) interest on general long—term obligations which are recorded when due, and (2) the non—current portion of accrued vacation and sick leave,which is recorded in the General Long—Term Debt Account Group. In applying the susceptible to accrual concept to intergovernmental revenues, the legal and contractual requirements of the numerous individual programs are used as guidance. There are, however, essentially two types of revenues. In one, monies must be expended on the specific purpose or project before any amounts will be paid to the City; therefore, revenues are recognized based upon the expenditures incurred. In the other, monies are vitually unrestricted as to purpose of expenditure and are usually revocable only for failure to comply with precribed compliance requirements. These resources are reflected as revenues at the time of receipt or earlier if the susceptible to accrual criteria are met. Property taxes are recognized as revenue in the year for which taxes have been levied, provided they are collected within 60 days after year end. Special assessments are recorded as revenue in the year the individual installments arc due. Licenses and permits, charges for services, tines and forfeitures, and miscellaneous revenues (excep( investment earnings) are recorded as revenues when received in cash because they are generally not measurable until actually received. Investment earnings are recorded as earned since they are measurable and available. The accrual basis of accounting and economic resources measurement focus is used by the proprietary funds. Unbilled service revenue is accrued in proprietary funds. (d) Encumbrances Encumbrance accounting, under which purchase orders, contracts, and other commitments for the expenditure of funds are recorded to reserve that portion of the applicable appropriation, is employed in the governmental funds. Open encumbrances are reported as reservations of fund balances since the commitments will be honored through subsequent years' budget appropriations. Encumbrances do not constitute expenditures or liabilities. 1 t J CITY OF LODI Notes to General Purpose Financial Statements (e) Cash and lovcstments The City maintains a cash and investment pool that is available for all funds of the City for the purpose of increasing interest earnings through investment activities. Each fund's portion of this pool is displayed on the combined balance sheet as 'cash and investments'. Interest earned on the pooled funds is allocated to various funds based on year end balances. Investments are stated at cost or amortized cost, which appTxirnates market. (f) Inventory i Inventory is valued at the lower of cost (weighted average method) or market. The cost of inventory is recorded as an expenditure/expense at the bine individual inventory items are consumed (consumption method). (g) General Fixed Assets General Fixed Assets have been acquired for general governmental purposes and are stated at estimated cost (Note G). Assets purchased are recorded as expenditures in the governmental funds and capitalized at cost in the general fixed assets account group. Capital leases for buildings, improvements, and equipment are recorded in the general fixed asset account group, and the capital lease obligation payable is recorded in the general long—term debt account group. Contributed fixed assets are recorded in the general fixed asset account group at estimated fair market value at the time received. Certain improvements such as roads, bridges, curbs and gutters, streets and sidewalks, drain systems, and lighting systems are not capitalized. Such assets normally are immovable and of value only to the City. 1ltcrefore, the purpose of stewardship for capital expenditures is satisfied without recording these assets. No depreciation has been provided a general fixed assets, nor has interest been capitalized. (h) Fixed Assets — Enterprise Fund Fixed assets owned by the enterprise funds are stated at cost or estimated fair market value at the time received, if donated. 13 CITY OF LODI Notes to General Purpose Financial Statements Depreciation has been provided over the estimated useful lives using the straight—line method. The estimated useful lives are as follows: (i) Compensated Absences/Vacation and Sick Leave Noncurrent accumulated vacation and vested sick leave benefits for governmental funds are recorded in the General Long—Term Debt Account Group as a liability and also as an amount to be provided by future operations. The amount to be provided by future operations represents the total amount that would be required to be provided from the general operating revenues of the City if all the benefits were to be paid. The current portion, the amount expected to be paid in the next twelve months, is recorded as a liability of the responsible fund type. Enterprise Funds record compensated absences/vacation and sick leave as an expense and liability when earned by employees. (j) Self—Insurance The City is self—insured for general liability, workers' compensation, dental benefits, unemployment, and long—term disability. The operating funds are charged premiums by the City's self—insurance funds, which are accounted for as internal service funds. The accrued liability for estimated claims represents an estimate of the eventual loss on claims arising prior to year end including claims incurred but not reported. (k) Total Columns Total columns on the combined statements are captioned "Memorandum Only" to indicate that they are presented only to facilitate financial analysis. Data in these columns do not present financial position, results of operations, or cash flows in conformity with generally accepted accounting principles. Such data is not comparable to a consolidation since interfund eliminations have not been made. 14 Years Buildings 15-20 Improvements 3— 5 Machineryand equipment 2-20 Utility plant 30 (i) Compensated Absences/Vacation and Sick Leave Noncurrent accumulated vacation and vested sick leave benefits for governmental funds are recorded in the General Long—Term Debt Account Group as a liability and also as an amount to be provided by future operations. The amount to be provided by future operations represents the total amount that would be required to be provided from the general operating revenues of the City if all the benefits were to be paid. The current portion, the amount expected to be paid in the next twelve months, is recorded as a liability of the responsible fund type. Enterprise Funds record compensated absences/vacation and sick leave as an expense and liability when earned by employees. (j) Self—Insurance The City is self—insured for general liability, workers' compensation, dental benefits, unemployment, and long—term disability. The operating funds are charged premiums by the City's self—insurance funds, which are accounted for as internal service funds. The accrued liability for estimated claims represents an estimate of the eventual loss on claims arising prior to year end including claims incurred but not reported. (k) Total Columns Total columns on the combined statements are captioned "Memorandum Only" to indicate that they are presented only to facilitate financial analysis. Data in these columns do not present financial position, results of operations, or cash flows in conformity with generally accepted accounting principles. Such data is not comparable to a consolidation since interfund eliminations have not been made. 14 0 CITY OF LODI Notes to General Purpose Financial Statements (1) Statement of Cash Flows In 1991, the Cityadopted Statement No. 9of the Governmental Accoa:tting Standards Board which requires the presentation of a statement of cash fl«s and certain other disclosures. The Ckyconsiders all highly liquid investments (including restricted assets) with a maturifyof three months or less when purchased and investments maintained in the pool to he cash equivalents. (m) Reclassifications Certain reclassifications have been made to the 1991 financial statements to conform with the 1%2 presentation. (2) Budgetary Data The City adopts an annual budget for the general and special revenue funds. Financial statements which present budget and actual data include only funds for which an annual budget was adopted. The budgets of capital projects are primarily "long—term" budgets which emphasize the major programs and capital project plans emending over a number of years. Because of the long—term nature of these projects, "annual" budget comparisons are not considered meaningful, and accordingly, no budgetary information is included in the general purpose financial statements for capital projects funds. The City Council follows these procedures in establishing the budgetary data reflected in the accompanying financial statements: On or prior to the first regular Council meeting in June of each year, the City Manager submits to the City Council a proposed operating budges for the fiscal year commencing July 1. The operating budget includes proposed expenditures and the means of financing them, The budget is established on an accrual basis. Public hearings are conducted during meetings of the City Council to obtain citizen comments. Prior to July 1, the budget is legally enacted through passage of an ordinance. The City Manager or designee is authorized to transfer certain budgeted amounts between accounts; however, any revisions that alter the total appropriations or functional expenditure classifications of any fund must be approved by the City Council. Supplemental appropriations were made during the year. The Combined Statement of Revenues, Expenditures and Changes in Fund Balance — Budget and Actual — General and Special Revenue Funds reflect all revisions. 15 7 G A C O � R Q 9 v e v a yCy C ryryY}} R T G G t7 V �• v u � a d y V V ~ w O V O O tu7 v V t F oG $ V Q � co Y0O � y O O tood. if I E T O. O Oow ` V y C 7 G C V •�". Qn a H. a w in a t 8 a t" %O �ml I. ., ik ij CITY OF LODI Notes to General Purpose Financial Statements Category 1 Securities that are insured or registered, or for which the securities are field by the City or its agent in the City's name; Category 2 Securities that are uninsured and unregistered and are held by the broker's or dealer's trust department or agent in the City's name; and Category 3 Securities that are uninsured and unregistered and held by the broker or dealer, or by its trust department or agent, but not in the City's name. Tltc following is a detail summary of cash and investments at June 30,1992; Unrestricted: Cash and deposits Certificates of deposit Investments: U.S. Treasury notes Local Agency Investment Fund Various mutual funds Various investments Deferred compensation: Pooled investments Total cash and investments 17 i •� Approximate Market Cast Value Cale_gory s 801,021 801,021 — 1,450,000 1,450,000 — 2,993,700 2,993,700 1 15,454,065 15,454,065 4,086 4,086 57,085 135,000 1 8,392,061 8,392,061 — S _ 29,152,018 29,229,933 17 i •� 1 CITY OF LODI Notes to General Purpose Financial Statements (4) Property Tax San Joaquin County is responsible for assessing, collecting and distributing property taxes in accordance with enabling legislation. Revenue received is based on an allocation factor calculated by the County under the provisions of Proposition 13 plus a percentage of the increase in market value in specific areas. The City's property tax is levied each July Ist on the assessed value listed as of the prior March Ist for all real and personal property located in the City. Property sold after the assessment date (March 1st) is reassessed and the amount of property tax assessed is prorated. Ttte assessed value at March 1, 1991, upon which the 1992 levy was based, was $2,203,351,420. Taxes are due in two equal installments on November I and February I following the levy date, payments are delinquent after 40 and 60 da),., respectively. Propeny taxes levied for the year ended June 30, 1992, are recorded as receivables, nct of estimated uncollectibles. Property taxes paid to the City by the County within 60 days of the end of the fiscal year are "available" and are therefore, recognized as revenue. The remaining uncollected halance will be recorded as revenue when received. (5) Water loan receivabie/Payabic California Safe Drinking Water Bond Note Payable The City entered into a 54,758,000 contract on October 1G, 1991 with the State of California Department of Water Resources to assist the City in financing the construction of a water project enabling the City to meet safe drinking water standards established by the State. The bonds are secured by the project and a pledge of user fees collected by the Water Enterprise Fund. Commencing October 1, 1993 semiannual payments of $173,313, including interest at 3.41%, are payable October Ist and April Ist through 2014. Loan Receivable 54,253,073 First requisition reimbursement received 504,927 Loan Payable 54,758,000 18 u t O+ 0 M t^i 'i0_ 1 N WZ� N OCL O!I — M .s Q M"iI � n r- c u t O+ 0 O N u c H v E c C R � � I 00 tt{ 1 MN 7 Q ✓i 9 h r O M N O C fV Nl u t O+ 0 u c H v E c C R n�U> U �J u t O+ N N N Co. � Y 1 .. vOs• °•� O� � d O O O T I r aPD .N•• N 9 •' ' i I � II11 ` pQ pQ' pQ v G v 1 � F F OF !1 h Q N 1 11 M N N Co. M N � Y 1 .. vOs• n- y0 .1 9 O V� N q a $ ppp p• r N O� •'y � a I H n y h r V a T u $ v ae ea C7 0` c w o U Z 0 0 ci an � i G V OW ti Is @ a e o C o Oman p H c y g 0 r JS w- "-F- v e E u e ,X 'u -a m m m m tui m O w s � M N � N 1 .. vOs• n- y0 .1 9 O CITY OF LODI Notes to General ?urpose Financial Statements Long-term debt payable at June 30,1992 is comprised of the following individual issues: f j 1965 Municipal lmprovement Bonds - Series A - These bonds were issued to finance the construction of sewer and drainage facility plus a public safety building. The bonds are secured by a pledge of property tax revenues. Principal is payable annually through October 1, 1995, with interest. 1965 Municipal Improvement Bonds - Series B - These bonds were issued on May 1, 1969 to finance the construction and completion of storm dainage improvements for the City of Lodi. The bonds arc secured by a pledge of property tax revenues. The annual principal payments, with semiannual payment interest of 4.50% to 5.25%, are payable on May 1 and November 1 through 1994. Special Assessment District Bonds with Governmental Commitment - The City is obligated under the terms of the Lodi United Downtown special assessment bond indentures, in the absence of any other bidder, to be the purchaser of property upon which any special assessments arc levied and are delinquent. Certificates of Participation - $11,170,000 Certificates of Participation (1991 Wastewater Treatment Plant Expansion Refunding Project), were sold in December 1991 to refinance the 1988 Wastewater Treatment Plant Expansion Project at a lower interest rate with approximately S1,400,000 of additional proceeds. Principal is payable annually August t, beginning 1992, in amounts from $330,000 to S760,000 with final payment due August 1, 2026. Interest rates range from 4.50% to 6.600'/0. The annual principal and interest requirements to amortize all debt outstanding as of June 30,1992 are as follows: Year Boding General Obligation Bond Special Assessment Bonds certificates of Participation June 30 Principal Interest Principal Interest _Principal ^�_ Interest 1993 S 310,000 43,637 2S,000 23,950 330,000 717,815 1994 325,000 32,20 30,000 21,575 100,000 708,040 1995 280,000 19,950 30,000 18,695 110,000 703,022 19% 290,000 10,150 35,000 15,785 1101000 697,605 1997 0 0 40,000 12,335 115.000 691,836 thereafter _ 0 0 85,000 _ 12,870 10,405.000 13.702,105 $ _1203,000 106,025 245,000 1052 11,170,000 ^17,220,423 21 1 � k § \ || k � ■ § � k � 2 k § k � | ! | § � £� E � 2 ■ o O 2 2� § . 0 : 2 : a k § \ || k k k ) § � � 2 k � | ! | § k § n \ || k k k ) § � � 2 k n \ � 7 - ) § � £� C% I a ■ o �k 2� 0 GI � �k cc 2 k -] � 2 'A � ƒ 2 § 3] 22 \k �\ k7 k k 2 ° o a S kd �� �3 k\ }� £Q »■ �� �) \ A a ©' � � i ■ / k o ■ k % o J \ W § d \ � k E&. � �/k G $ g 2 2 $ n _ � 2 k k k _ C� lk \ � k § f � � Z 88 S| §� 2 A& & f � - f ■ / � \ _ q � & a i k S S / § ■ 8 Q m - § k § . . . > \ A a § k . ■ e \\ k B � 3 U. w U.2 § # o F. a ■ v \ 2= 0 U. ■ s . d 062ej? 7 } J k (A r d l R : � CITY OF LODI Notes to General Purpose Financial Statements (9) Fund Balance I The following is a summary of reserved, unreserved—designated and unreserved fund balances at June 30,1992: Special Debt Capital Tram Ii General Revenue Service pr!�ecu Nen _, Total Reserved for. Encumbrances f 56,738 162,848 132,654 $ 352.240 Inventory 102,773 102,773 Total Reserved 159,511 162,848 0 132654 0 455,013 Unreserved—Designated for: Prior Year Obligations 447,278 2,283,080 3,620,396 20,298 6,371,053 Plant Replacement 16,545 16,545 Debt Service 216,520 216.520 Loan Repayment _ 200,000 200,000 Total Designated 447,278 2,283,080 233,065 3,820,396 20,298 6,804,118 Unreserved 714,227 714,227 Total Fund Balances s 1,321,016 2,445,928 233,065 3,953,050 20,298 7,973,357 Reserved Fund Balance Reserved fund balance indicates that portion of fund equity which has been legally segregated for specific purposes. Unreserved—Designated Fund Balance Designated fund balance indicates that portion of fund equity for which the City has made tentative plans. Unreserved—Undesignated Fund Balance Undesignated fund balance indicates that portion of fund equity which is available for budgeting in future periods. 24 j CITY OF LODI Notes to General Purpose Financial Statements Operating Transfers Total operating transfers by fund type at June 30, 1992, are as follows: Special Assessment Districts 1 n accordance with the Governmental Accounting Standards Board Statement No. 6, the special assessment district debt for which the City has no obligation is recorded in an agency fund. The debt service transactions for the Turner Road and Cluff Avenue" and the "Industrial Way and Beckman Road" specs, assessment district bonds are accounted for in the trust and agency funds. The City is not obligated in any manner in the event of default on the dela. The special assessment district debt forwhich the City has an obligation is recorded on the the City's financial statements. As the City is obligated on the Lodi United Downtown assessments, the debt is recorded in the general long—term debt account group (see note 7). The debt service transactions for this assessment are recorded in the debt service fund. 25 Operating Transfers Fund in Out General fund S 5,217,101 1,571,856 Special Revenue Funds 356,878 143,573 Capital Projects Funds 200,946 576,737 Enterprise Funds 3,544,239 7,438,102 Internal Service Funds 427,994 16,889 S 9,747,157 9,747,157 Special Assessment Districts 1 n accordance with the Governmental Accounting Standards Board Statement No. 6, the special assessment district debt for which the City has no obligation is recorded in an agency fund. The debt service transactions for the Turner Road and Cluff Avenue" and the "Industrial Way and Beckman Road" specs, assessment district bonds are accounted for in the trust and agency funds. The City is not obligated in any manner in the event of default on the dela. The special assessment district debt forwhich the City has an obligation is recorded on the the City's financial statements. As the City is obligated on the Lodi United Downtown assessments, the debt is recorded in the general long—term debt account group (see note 7). The debt service transactions for this assessment are recorded in the debt service fund. 25 CITY OF LODI Notes to General Purpose Financial Statements (12) Defined Benefit Pension Plan (a) Plan Description The City contributes to the California Public Employees' Retirement System (PERS or System), an agent multiple employer public employee retirement system that acts as a common investment and administrative agent for participating public entities within the State of California. The City's payroll for employees covered by the System for the year ended June 30, 1992 was 514,119,323 which is 84.7% of the City's total payroll of $16,656,423. The System covers essentially all employees, except elected officials and those employees compensated on an hourly basis who were hired after May 31, 1966. City safety employees who retire at age 50 are entitled to an annual retirement benefit, payable monthly for life, in an amount equal to two percent per year times years of service based on the average monthly pay during the last twelve consecutive months of service or another period of twelve consecutive months if the average pay rate was higher. The benefit rate increases by retirement age up to a maximum of 2.7% after age 54. All other Cityemployees who retire at age 60 are entitled to an annual retirement benefit, payable monthly for life, in an amount equal to two percent per year times years of service based on the average monthly pay during the last 36 consecutive months of service or another 36 consecutive month period if the average pay rate was higher. The benefit rate fluctuates depending on the employee's retirement age. The lowest rate of 1.092% is received at retirement age after 50. The maximum rate is 2.418% at a retirement age after 62. The System also provides death and disability benefits. These benefit provisions and all other requirements are established by state statute and City resolution. Certain safety employees are required to contribute 9% to their annual salary to the System. All other employees are required to contribute seven percent. The City is required to contribute the remaining amounts necessary to fund the benefits for its members, using the actuarial basis recommended by the PERS actuaries and actuarial consultants and adopted by the Board of Administration. 26 i 1 i ( } 1 i ? '• i � � i { CITY OF LODI Notes to General Purpose Financial Statements (b) Funding Status and Progress Th. :mounts shown below as the "pension benefit obligation" is a standardized disclosure measure of the present value of pension benefits, adjusted for the effects of projected salary increases and step—rate benefits, estimated to be payable in the future as a result of employee services to dale. The measure is intended to help users assess the funding status of the System on a going—concern basis, assess progress made in accumulating sufficient assets to pay benefits when due, and make comparisons among employers. The measure is the actuarial present value of credited projected benefits and is independent of funding method used to determine contributions to the System. The pension benefit obligation was computed as part of an actuarial valuation performed as of June 30,1991. Significant actuarial assumptions used in the valuation include (a) a rate of return on the investment of present and future assets of 8.75% a year compounded annually, (b) projected salary increases of 4.5% a year compounded annually, attributable to inflation, (c) additional projected salary increases of 2.65% a year, attributable to seniority/merit, and (d) no post retirement benefit increases. Total unfunded pension benefit obligation applicable to the City's employees was $3,359,333 at June 30, 1992, as follows: Pension benefit obligation: Retirees and beneficiaries currently receiving benefits and tcrminiated employees not yet receiving benefits Current employees: Accumulated employee contributions including allocated investment earnings Employer—financed vested Employer—financed nonvested Total pension benent obligation Net asseu available for benefits, at cost (awket value approximates $49,953,032 ) Unfunded pension benefit obligation Changes in the pension benefit obligation from last year of $299,560 were due to changes in actuarial assumptions. 27 $ 24,301940 11,366,720 11,975,453 756,531 48,402,644 45,043,311 S _1359,333 �J a] CITY OF LODI Notes to General Purpose Financial Statements (c) Actuarially Determined Contribution Requirements and Contribution Made PERS uses the Entry Age Normal Actuarial Cost Method which is a projected benefit cost method. That is, it takes into account those benefits that are expected to be earned in the future as well as those already accrued. According to this cost method, the normal cost for an employee is the level amount which would fund the projected benefit if it were paid annually from date of employment until retirement. PERS uses a modification of the Entry Age Cost Method in which the employer's total normal cost is expressed as a level percentage of payroll. PERS also uses the level percentage of payroll method to amortize any unfunded actuarial liabilities. The amortization period of unfunded actuarial liability ends on June 30, 2000. The significant actuarial assumptions used to compute the actuarially determined contribution requirement arc the same as those used to compute the pension benefit obligation, as previously described. The contribution to the System for 1992 of $2,721,845 was made in accordance with actuarially determined requirements computed through an actuarial valuation performed as of June 30, 1991. The contributions consisted of: (a) 52393,535 normal cost ( 16.95 % of current covered payroll) and (b) ($328,310) amortization of the unfunded actuarial accrued payroll liability (2.33% of current covered payroll). The City contributed 51,624,898 of this total (11.5% of current payroll) and the employees contributed $1,096,947(7.77 %of current covered payroll). The actual employer contributions were reduced by $921,680 due to permitted usage of surplus aisets. (d) Trend Information Trend information gives an indication of the progress made in accumulating sufficient assets to pay benefits when due. For fiscal years after 1987, PERS began to provide the City, as well as all other system members, information necessary to comply with actuarial disclosure requirements. Until ten years of data can be accumulated, the available data for the period 0-: System was in place will be presented. 1988 is the first year that the actuarial information was made available by PERS. Actuarial information is computed through an actuarial valuation performed as of June 30 of the previous year. The frena information for fiscal year ended June 30, 1987 through 1992 are as follows! a 'Lrf CITY OF LODI Notes to General Purpose Financial Statements Actual Unfunded Pension Made io Accordance with Acuariaily Net Assets Pension Unfunded Annual Benefit Obligation Dctcrmtoed Requirements, as a Fiscal Available Benefit Percentage Pension Itcocrit Covered As A Percentage Percentage of Covered Payroll Year For 11cacfits Obligations Funded Obligation Payroll of Covered Payroll As Uinployer On behalf of limployce 1987 28.784,100 34,242,(M 84.1% 5,458.500 9,606.000 56.8% 15.6% 7.9% 1988 32,566.900 37,522,800 86.8% 4,955,800 10,472,500 47.3% 11.9% 7.8% 1981) 37,248,900 40,651,700 91.6% 3,402,800 11,184,300 30,4% 11.5% 7.8% 11`10 41,873,300 45,347,800 92.3% 3,474.500 12,736,600 27,3:1 10.24E 7.8% 199i 45.043,300 48,402,600 93.19E 3,359,300 14,119,323 23.24E 11.5% 7.8% (13) Deferred Compensation Plan The City offers its employees a deferred compensation plan (Plan) created in accordance with Internal Revenue Code Section 457. The Plan, available to all City employees, permits them to defer a portion of their salary until future years, The deferred compensation is not available to employees until termination, retirement, death, or unforeseeable emergency. All amounts of compensation deferred under the Plan, all property and rights purchased with those amounts, and all income attributable to those amounts, property or rights are kuntil paid or made available to the employee or other beneficiary) solely the property and rights of the City subject only to the claim of the City's general creditors. Participants' rights under the Plan are equal to those of general creditors of the City in an amount equal to the fair market value of the deferred account for each participant. The City does have the duty of d ue care that would be required of an ordinary prudent investor. 29 0 e w 9 C u � C c C y v C n 111 � a V -- e m v E E o. 2. y u C O CITY OF LODI Notes to General Purpose Financial Statements (15) Contingent Liabilities Self—insurance — The City is exposed to various risks of loss related to torts; theft of, damage to, and destruction of assets; errors and omissions; injuries to employees; and natural disasters. The City has established a Risk Management Fund (an internal service fund) to account for and finance its uninsured risk of loss. Under this program, the City is self—insured under its existing general liability insurance policy for the first S5(M),(xx) of claims, per occurance, with the California Joint Powers Insurance Agency (CJPIA, note 17) providing certain liability coverage for the next $500,0(x) per occurance and in the aggregate. Additional coverage is available with the CJPIA for claims in excess of SI A)0,000 to $10,000,000 peroec:urrence and and in the aggregate. The City is also self—insured with respect to workers' compensation, dental, unemployment, and longterm disability for its employees. Self—insured transactions are accounted for in the Internal Service Fund. General liability and workers' compensation are administered by an outside agency, the other programs are administered by the City. The City purchases commercial insurance for workers' compensation claims from $300,000 to $1,000,(x)0. Incurred but not reported claims have been considered in determining the accrual for the self—insurance reserve. The City has a self—insurance reserve of $2,048,796which is reported as a liability in the Internal Service Fund. The reserve amount is based on the requirements of Governmental Accounting Standards Board Statement No. 10, which requires that a liability for claims be reponed if information prior to the issuance of the financial statements indicates that it is probable that a liability has been incurred at the date of the financial statmenis and the amount of the loss can be reasonably estimated. Payable amounts are based on administrators reports and the City's estimate for incidents incurred but not reported. The City does not use an actuary to determine the liability. Changes in claim reserve amounts in fiscal year ended June 30,1992 areas follows; actioning—of Curreol—Year Balance at Fiscal—Ycar Claims and Cbaogcs Usims Fiscal Liability in Estimates — Payments Ycar—t?ad 1991-1992 f 1,446,021 308,612 294,170 2,048,796 Expansion of Sewage Treatment Plant — The City issued certificates of participation to pay for the expansion of the capacity of its sewage treatment plant. The City is committed to pay any sewage treatment plant expansion costs in excess of the cash provided from the issuance of the certificates of participation. 31 CITY OF LODI Notes to General Purpose Financial Statements Litigation — The City of Lodi, California is a defendant in various lawsuits. The City Attorney estimates that the potential claims against the City not covered by insurance resulting from such litigation would not materially affect the financial condition of the City. Arbitrage Earnings Rebate liability — Bond Council has calculated possible arbitrage earnings of 5134,979 as of August 1, 1092. Arbitrage earnings are defined as income earned on the unexpended tax exempt bond proceeds in excess of that which would have been earned had the monies been invested in securities with a yield of the effective rate of the bond anticipation notes. Currently, arbitrage earnings must be rebated to the United States Treasury every five years from the date of August 1, 1988. (16) Membership in the Northern California Power Agency The City, alongwith various other public agencies, is a memberof the Northern California Power Agency (NCPA) which was originated for the purpose of exercising their common power to purchase, gencrate,sell or interchange electric energy and capacity through the acquisition and use of electrical generation and transmission facilities. NCPA's governing body is composed of one representative from each member. The governing body is given the general management of the affairs, property and business of NCPA and is vested with all powers of NCPA. Expenses related to payments to NCPA at June 30, 1492 amounted to $25,793,912. The City, under its contractual obligations, jointly funds the operations, construction and development programs of NCPA. The City has committed, if necessary, to advance certain annual amounts to NCPA in the future for the continuance of construction and development programs. No funding of future advances is contemplated for 1993. The membership in NCPA is considered a joint venture for accounting purposes. The following arc condensed financial statements for NCPA: Combined Balance Sheet June 30,1991 Asse is Current assets S 61,115,000 Restricted assets 353,830,000 Electric plant, net 770,879,000 Other Assets and deferred charges 373,438,000 Total assets S 1.559.262.000 Liabilities and Capitalisation Current portion of long—term debt S 22,190,0(X) Other current liabilities 56,598,000 Other liabilities and deffercd credits 26,992,((X) Long—term debt 1,420,860,000 Accumulated net revenues 32,6_22,((X) Total liabilities and capitalization S 11559 262 M0 32 1 wri CITY OF LODI Notes to General Purpose Financial Statements Combined Statement of Revenue and Expenses June 30, 1991 Sales 150,808,000 Operating Expenses (80,485,000) Nonoperatingcxpenses, net (65,973,000 Net revenue 4,35Q,000 (17) Membership in the California Joint Powers Insurance Authority Combined Statement of Cash Flows June 30,1991 Net cash provided by operating activities 96,956,(X)0 Net cash provided by investing activities 70,856,(X)) Net cash used in capital and related financing activities (141,699,000) Net cash provided by non—capital and related financing activities l,fi96,(Xb Increase in cash and cash equivalents 27 R,_09�(X)0 The City is a member of CJPIA. Various public agencies formed the CJPIA for the purpose of sharing the risk of catastrophic general liability, automobile liability and public officials' errors and omissions losses because adequate insurance is not available in the commercial insurance insurance market. The ultimate cost of the program to the City will depend on the catastrophic losses of all members, as well as the City's own loss experience, and will be determined retrospectively five years after the end of the current program year, The City periodically pays deposits to the CJPIA. These deposits are recorded as expenditures in the year paid as they are a reasonable estimate of the actual cost of the program. During the year ended June 30, 1992, no deposits were paid to the CJPIA. 33 CITY OF LODI Notes to General Purpose Financial Statements (18) Advanced Refunding Obligations: Certificates of Participation i In December 1991, the City issued its Certificate of Participation — Wastewater Treatment Plant Expansion Refunding Project Series 1991 to replace Series 1988. The refunding in the short term improves debt service cash flows by taking advantage of lower long—term interest rates. The 1988 Certificate of Participation's are not actually redeemable until August 1, 1993, but were considered redeemed as of December 18, 1991. The City transferred sufficient assets to an irrevocable trust to provide for future debt service payments on the 1988 COP until their call date of August 1, 1993. The defeance of the certifcates freed the City from liability for the certificates and accordingly, the certificates payable and assets sufficient to retire the indebtedness were removed from the combined balance sheet. A summary of the extraordinary loss from refunding as of December 18, 1991 follows: Unmatured principal S 9,100,000 Interest payable by trust 270,948 Unamortizcd bond discount (463,788) Net obligation defeased 8,907,160 Funds transferred to trust 9,935,260 Loss on defeasance S 1,028,100 The refunding will enable the City to reduce debt service cash outflow by approximately $U,000 during the first year, but will increase total cash outflow by approximately S 1,700,000 as compared to the prior indentures. The increase in rash outflow of approximately $1,700,000 is primarily due to the Increased level of debt plus related interest. The refunding also provides an economic gain (present value of the difference between new and old debt service requirements) of approximately $870,000. I t 1 F ) r 34 J CITY OF LODI Notes to General Purpose Financial Statements (19) Excess of Actual Expenditures Over Budget in Individual Funds Actual expenditures exceeded budget by $84,957 in the General Fund Public Protection budgetary level. Available fund balance and current revenues were sufficient to fund these excess expenditures. (20) Deficits in Fund Balance/Retained Earnings The following individual funds had a deficit in Fund Balance/Retained Earnings at June 30, 1992: Community Development Agency (Special Revenue Funds) — A deficit fund balance in the amount of $41,472 in the Community Development Block Grant is due to costs and expenses incurred in relation to the planning stages of the various projects in the City's Development plan prior to actual receipt of expenditure reimbursements. (21) Subsequent Events Local Agency's Worker's Compensation Excess Joint Powers Authority The City Council authorized participation in the Local Agency's Workers' Compensation Excess Joint Powers Authority (LAWCX). Participation required an initial three—year commitment. The rate for the City of Lodi was set at eighteen cents per SlW of payroll, three cents of which funds a "pool". Once fully funded (in 3-5 years), it is anticipated that the rate will drop. In addition, the self—insured retention of the City was reduced, and LAWCX provided excess insurance to statutory limits. Dail—A—Ride Effective September 10, 1992 the City Council authorized the hiring on a contract basis the present Dial —A—Ride dispatchers and drivers and terminated the contract with City Cab Company due to their failure to maintain Worker's Compensation insurance. This failure represented a material and intentional breach contract. NCPA Bond Issuance The City's electric utility is a member of the Northern California Power Agency (NCPA), a joint exercise of powers agency, which issued $163,240,000 in revenue bonds on October 20,1992 for multiple capital facilities. One of those facilities to be constructed is a power generating station to be built in Lodi and sold to the City upon completion (Feb. 1995). The estimated cost of the project is S9.4 million. The bonds are to be paid through revenues collected by the NCPA on sale of electricity. The Member Agreements do not authorize NCPA to require the Project Participants in any Component to pay debt service allocable to any other Component. 35 J SUPPLEMENTAL FINANCIAL STATEMENTS GENERAL FUND OVERVIEW The General Fund is maintained to account for all financial resources that are not restricted as to their use This includes sales taxes, business tax receipts, franchise taxes, and various subventions such as Cigarette Taxes and Motor Vehicle In—Lieu fees received from the State of California. With the exception of grant programs, General Fund sources can be utilized for any legitimate governmental purpose. Due to the scale and flexibility of General Fund revenues, a broad range of municipal services are provided through this fund. The following is a summary of the services primarily financed through the General Fund by Department: Office of the City Manager Personnel Office Community Center Office Implementation of City Council policies Employee Relations Aquatics Intergovernmental relations Recruitment, Selection and Classification Facilities Administration Community Promotion Affirmative Action Senior Activities Risk Management and Insurance Benefits Administration Cull ural Act ivilics Salary and Benefits Administration Police Department Department of Public Works Budget Administration Patrol Engineering Services Transit Operations Crime Prevention Street Paving and Sweeping Disaster Preparedness Animal Control Sidewalk and Street Maintenance Solid Waste Management Investigations Traffic Signal & Sign Maintenance Telecommunications Drug Suppression Storm Drain Maintenance Safety Fire Department Tree Maintenance Office of the City Attorney Emergency Response Vehicle & Equipment Maintenance Legal Advisor to the City Council Itazard prevention Building Maintenance Contract Rcview Weed Abatement Parking Lot Maintenance Litigation Parks and Recreation Department Department of Community Development Office of the City Clerk Park Maintenance Development Review Official City Recordkccping Youth Programs General Plan Council Meeting Agendas and Minutes Adult Programs Environmental Impact Reporting Elections Pre—school Programs Demographic Information Chamber of Commerce Senior Activities Design Review Department of Finance Aquatics Building and Safety Revenues and Collections Trips and Classes Financial Reporting Library Debt and Investment Management Adult Reading Material Data Processing Youth Reading Material Parking Enforcement Research Services Utility Billing Adult & Youth Education Programs Purchasing Although several of the activities listed above may be partially financed through other funds, the primary source: of funding for these services is the General Fund. For example, central support services provided by the Department of Finance are organized in the General Fund, these services are provided to Enterprise Fund Activities, Special Revenue Fund Activities, and Capital Outlay Fund Activities. Reimbursement transfers are made from the other funds to the General Fund based on a formula calculated each year as compensation for these services. a� J M CITY OF LODI GENERAL FUND COMPARATIVE BALANCE 81188'1' June 30, I992 (with comparative lotals for June 30, 1991) I 1992 1991 ASSETS — —! Cash and Invest menu f 2,774,760 1 2,316.630 Receivables (net dallonana for uncollectibles): Accounts 348,459 766283 Property tams $9,396 Interest 60,673 79,290 Due from other funds or governmental agencies 1,036,136 20.162 Inventory 102,773 94,739 Other assets 23,716 :8.312 TOTAL ASSETS S 4,047,7 5 S _ 3,103p% LIABILITIES AND FUND BALANCE LIABILITIES Accounts payable and other liabilities S 376,2% 1 402,892 Accrued salaries and wags 271133 226,603 Accrued compensated absences 1,047.290 1.043,236 Deferred revenue 1.031.878 TOTAL LIABILITIES 2,726,699 1.674,733 FUND EOUITY Fund balances: Reserved for encumbrances $6,736 102,433 Reserved for inventory 102,773 100,433 Unreserved - designated 447,278 314,760 Unreserved 714,227 713,293 TOTAL FUND BALANCE 1.721,016 1,430,%3 TOTAL LIABILITIES AND FUND BALANCE 1 �e 4.017 715 S 7105 6%04 See accompanying Independent audium'report. I A .. ... . .. — 1- rs U O ik y Ii c�idti o;�ie�xej� RF a sf ZIA ;!x^ g n N C l 17WW1 0 o CCD tit W X at w p A .. ... . .. — 1- U) Z W 2 W F— Q F— CO r v. J v vi C y .a � h •a � 3 3 c G c y w y J C U4 0�• y� °•E c U 00 ' :v a Ca L' r'�".. n' to ° R 'y C C .� •7 C �, y C C •� y v cc p ., •�' U v V �v � Or. h 7 > U '° to U �•� U G °14 3 e V tO ci v C V s fly+ U v= GG O CC C• o N c 0 C `= 3 " `° 9 ° C ea y in U y c m 3 G v U U c m C U v t ca es O cc o U y c._? c.5 3 `° .o ..o ep o c >, •° s v v� g ° iO E� N C v U u a 7 O L•U, CC cc q h O cs p .� U a. U E c . C ` ma a R y 0 0 r t �• y r r ... O p c •� — ` G v •C C — �• V V ° �io � y 0 � V v � a � 'E •c 'c H v � �', � � ° � ° A c. a E 0 r0cc � a °—Ucc to � � E E U o ° `°tj c uC �' ALJ `' C C U ..0Im _ C e r U J U D O C y `O cO U o' w V G to '0 y 0 EnC R y C C •00 cc m CC C 0 -aL 'C C 04 .� N J n ? N j = C r C Q N V .p N b4 - N y .Li p 17 w 'a -la 0 y r ti CL E •`y—° 9b•E E i to ° ei y r J V U .r. N :% a rii r y 'C '� > •5 ��. v •° r �r •_ p Ute— � � �E- E (off y c N Ca C ca y �' y •-' y y �C4 V i'i y •U ^ N ZiG N � F•' � �E" G NF VE-' Oce FE-•E-'� C.U., OE`� v UF'.N I CITY OF LODI ALL SPECIAL REVENUE FUNDS COMNININO BALANCE SHRET left K 1903 (sn1l6 wfyrso" uul66r Jnw K 1901) Sea 0.0ap6fy166166epef6rm sudime rtpwL 61� ....... ....... ........ ...... .. .. 4 } fir'+ Coeewhy Dexbpr,m Dn<bpw,ep Axe Special On T76mpauliof Ispacl E1e6 T.W. Selavt dant. Tae _ Mitillstbf Fee Oram I9412._..zW91T-- �— ASSETS C.,h..d lmeaerme 1 1:0.6:2 (46.013) 664.111 M611% 602.101 1110.729) 1 1.74LISS 1 1,014564 Reerir►it,(ene Q♦ albvanee fN—olkeeibk0: Aeew.0 666.95s M.955 211,09) INefeN I,b: 10.071 IO.N2 6.906 18.091 16.X10 Due ban the, fund, a ye.anleea.l gend.6 65.949 - 07110 IJ/,::v 11.761 01b., ewi. TOTALASSETS f � :2,f:J 17,va�6 691.172 1.20!,569 611,007, (2vJ 1 — •,6:5019 f I.IAIt11J TIES AND FUND MAL4NCE MAIIIIJIle$ A—mal payable and other liabilitie, 1 6,716 5.076 61,2'07 61929 10,491 1 4ndis 1 S:.MI A-wil xlri.a&M wt.t 1112 5.115 6,019 1,671 15,171 9.6m Ove to el6<r fund._ --- 6►,500 _...._. _..___ _ 6_6,Stq -. _.._—.174,111 ... ....M.S00 TOTALL)AOILITIES �.— 0 --_.-1.070 IJv9 117.746 6.3)21. t�u77 111,071 FUND EQUITY Fund 6.l..... Rexnd IN emuwkamo 109 41,673 19,7:0 7,601 91,675 162.64 1",140 Ure.rs6 - d.aigoo d IZZ311 1S 0,9"] N&M 1,03424 — $06,410 11 1,411) 2.264M TOTALFUNDBAIANCIS 122,63+ 10.676 "5,072 1,064649 602,012 (61,4711 7.44),9:6 1.:45,454 TOTAL LIABILITIES AND FUND )BALANCE 122.62) Sfe I7JJ6 "6.172 1.301569 611.007 (Zv.69v1 1 2.625019 4 _m�_�Nz70.',73 Sea 0.0ap6fy166166epef6rm sudime rtpwL 61� ....... ....... ........ ...... .. .. 4 } fir'+ CRY OP LODI ALL S►ECIAL REVENUE FUNDS COMBI NINO STATE%@NT OF ROVE NOES, BXFRNDRURRS AND MANOES IN FUND RALAWM Jam 10. 1"1 (.i1►sooprelh9 wWS for Jam lk I"ll 42 M Cewwwil7 pssb►wegl Oteb►wta A -i S►si.l On Tnaprl9d" Iw►xI Ela► T.W, i Saievs Or.ar Tat Mi+gpbn 1.. 0rw11 Isle PEWNUE5 Tut, L 690311 444741 L 1.10,91 1 792174 Imtt9...rwtadrnsnw+ 63. 6 63,611 I,SJI,So 144101 2.011.739 1.531.231 ClwStr lar unite! 114665 49130) 6111" 60,576 Imaar w6 read la.wt 9,153 129 56,tl9 17,124 Il,N3 1.'4061 95.4.1 Merta.ntovtttvew 31,l1y _— AM Toldrr.+m9t 91.116 —61.031 Y_y070 2. 155,414 _ 534M 1/1361 i d EXPENDRURES Gert. Otna1110+etnmta 1,523,1H 1,522,4H 1.110.50 P.61it PrYletlion !1,502 Rio., Wall P.6Tr.ar4 654"7 114951 114361 1,17,6E 1,591,693 Pdl .nd rnruiioe 65,811 65,811 1,106 Ca►,W outlay .__ —^ 172317 -__ _ 17:317 Toed a►tndaura -�~ 17,!03 65.!01 6!4167 I,94L431 17..37 114,263 (,1217457 3.10,39! EXCFSSIf7EFICIENCY)OFRE%ENUEO%VR EXPENDRURES Sl,l" (1.119) :64704 111.073 If105S 0 9"670 13149071 M IER FINANCINOSOURCES(USES) OP4.1K U.adtrl1. 214025 107 tf f 150679 101.70. Opaniq v.ndm oa.__11171 .__ __-I- —1 .---•'-. (141,57 Toul.,ha rmN[n11 wu4ttr(9M1) 115,7301 0 ... 0 O 344025 0 211,105 K4" EXCESS (DEFICIENCY) OF REANUES AND OTHER SOURCES O%ER EXPENDfrURES AND OrlIER USES 17,6M (3,719) 264701 11%072 607.011 0 I,IVP,v1S 11744" FUNDBALANCRMOINNINOOFYEAR IO{7S9 11,114 114370 75i2" (41A72) I,IU,v51 1,116,133 FUND BALANCE, END OF YEAR S 132621 111165 69%971 ifie.356 602061 (41,472) 5 3.415.931 L 1,34S,9U S. etoeFeaft 1a64►46dra &WWwjr rcW% 42 M .t.=E. IsG ss 1' 1 f I i � I m45!2 �► a;Ig i 'sip. t v I { 7L I �! I W � GIs ul L O O O O G ay[ y lax'. 9 w z z } �. p CO Z. W 2 W. VJ U Z Q Z_ LLI QUI F - Z W 2 W J IL IL U) i OVERVIEW I The City has established a debt service fund to account for the payment and accumulation of resources related to general long—term debt principal and interest for the following debt issues: 1965 Municipal Improvement Bonds — Series A and B These bonds were issued in 1965 and 1969 to finance the construction of sewer, storm drainage and a public safety building. These bonds are secured by a pledge of property tax revenues. Special Assessment District Bonds These bonds were issued in 1984 to finance a downtown beautification program and are secured by an assessment of properties in the District. CITY OF LODI DEBT SERVICE FUND COMPARATI VB BALANCE S11EET Jose 30, 1992 (Wilk eoaaparative lotais for Jane 30, 1991) LIABILITIES AND FUND BALANCE LIABILITIES Accounts payable and other liabilities 1992 1991 ASSETS 25,000 ^T� 25,000 Cash and Investments S 232,799 S :32,:07 Receivables (net of allowance for uncollectibles): Interest 632 694 Special assessment 25.000 25,000 TOTAL ASSETS S = _ _ _259 431 S = 257.90 LIABILITIES AND FUND BALANCE LIABILITIES Accounts payable and other liabilities $ 366 $ Deferred revenue 25,000 ^T� 25,000 TOTAL LIABILITIES 25,366 25,000 FUND EQUITY Fend balances: Unreserved — designated Z33.065 132,901 TOTAL FUND BALANCE 233,065 232,901 TOTAL LIABILITIES AND FUND BALANCE S 258,431 S 257,901 See accompanying Iadepeadeat auditors' report, CITY OF LODI DEIST SERVICE FUND COMPARATIVE ST'ATE'MENT OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCE June 30, 1942 (witb comparative totals for June 30, 1991) 46 0 1992 REVENUES --- l— -- -�-� - Taxes S 505('8 S 50,316 Interest and rental income 2,195 3,023 Miscellaneous revenue ------- 341,615332,(x)8 Total Revenue 394178---385 147 FXPEND"RES Debt Service Interest and fiscal charges 144,214 93,752 Principal payments - 250,000 312,142 Total Expenditures 394,214 ~------ 406,094 EXCESS OF REVENUE OVER (UNDER) EXPENDITURES 164 (20,747) FUND BALANCE, BEGINNING OF YEAR 232,901 253,648 FUND BALANCE, END OF YEAR $ _ 233,065 $ 232,901 See accompanying independent auditors' report. 46 0 r - Z Aft W W W- !- CO Q 0 CO Z 0 � tL Q � Q � or CL J Q J Q J OVERVIEW The following funds were used by the City in order to account for the financial resources used in the construction or acquisition of major capital facilities or equipment (with the exception of those financed primarily through special revenue funds and enterprise funds): Capital Outlay Fund This fund was established to account for all the City's construction projects and capital purchases in excess of S10,OW with the exception of those funded through the Equipment Fund and Enterprise Funds. Financing is provided primarily by operating transfers from other funds and from State and Federal grants. For internal control purposes, capital projects are segregated by funding source. These sources include: Library Capital Subdivision Capital Hutchins Street Square Capital Master Storm Drain Capital Lodi Lake Capital General Fund Contributions Equipment Fund This fund was established to account for the financing and replacement of equipment for all funds of the City with the exception of the Enterprise Funds. Financing is primarily provided through operating transfers from other funds, interest earnings and sales of surplus property. A4 I � � 7 | ' 21 - �) I �\ § / .- �j �■ & ke%� ■ *$ �4 | - }7 } !jr j \$� - )o - © - l! k � �k� � }� .. ! © � � � ` 2 ■ !� �r � ■ ! � § �-� ■ � !4 c m �i9 ■ i ■!■| ���+ � � � |ce � . } k � § f | ' , � - � ; £!f£ ■{7 � !§/ ! � ¥ «# r■ 2 ■$§ k | d 2 —_ , - |•; ! \ ! 2 2§ # !■� � �) � J${ � ! � 2��� . ) ,. ■ \ % � !!° i — � � �° 2 � § j • ! _ • , . } ƒf —ccac§ k'A � | ! ! k • o ! �| %! k k2 k f La £!!! k}�� k}}} Z|�� \\ # . ; {" U) 0 Z Z) W U) CC CL It W Z W V � 7� z C tw F- CD r-+ Z L iz U) 0 Z Z) W U) CC CL It W Z W . I i OVERVIEW Enterprise funds are distinguished by their similarity to private sector activities as the intent is to finance or recover the cost of providing services primarily through user charges. As such, the measurement focus is on net income in addition to financial position and changes in financial condition. An accrual basis of accounting with depreciation recorded as an expense, is utilized. Enterprise funds may also be established in order to account for operations under which the City or an outside grantor agency has decided that a periodic determination of revenues earned, expenses incurred, and/or net income is appropriate for capital maintenance, public policy, management control, accountability or other purposes. The City of Lodi uses the following three enterprise funds: Electric Utility Fund This fund was established by the City in order to account for the provision of electric services to the residents of the City. All activities necessary to provide such services are accounted for in this fund, including but not limited to, source of supply, overhead, systems maintenance, customer service, engineering, administration, capital improvements and maintenance, and debt service. Sewer Fund '['his fund was established by the City in order to account for the provision of waste water collection and treatment services to the residents of the City. All activities necessary to provide such services are accounted for in this fund, including, but not to, administration, operations, maintenance, improvements, and debt service. Water Fund This fund was established by the City in order to account for the provision of water to the residents of the City as well as some customers in the County. All activities to provide such services are accounted for in this fund, including, but not limited to administration, operations, distribution, maintenance, capital improvements, and debt service. CITY OF WDI COMBINING BALANCE SIB?HT - EN11TA RISH KINDS June 30, 1992 (rah eomparatix totals forJuae 30.1991) Totals Electric ----- -----Sewer - Wag --'-----'- 1992 -------- -- 1991 -- ASSE.I.S Ca>h and Investments S +,)95.361 5,065.4!0 641.560 S 10.10!741 S 9,963,56 Restrctsd assets 0 1.15+.605 Receivables (net of allowance (or uncollatibles): Accounts t,927.M 16042 196,641 2:6S.069 2.170,430 Nater loan +:53,073 +:53,073 Intrresl 7+.955 71,5!0 7,405 15500 160.634 Due (rpm 0o) nlher funds 0 or gaxmmenlal agrortes 644.(100 99,761 55 .019) 996,761 1.137.)33 LlreniorY 1506,903 16,607 2511,0fM 1.717,316 10.1.06 fkfcrmd (inasc m6cmu ;11,732 ;71,73; 7,661 Other assets 10,206 10206 7.661 I.aedatM1 9,716.417 29,063)63! _ F939.935 _ 47_,72:064 _40.017,901 TOTAL ASSETS S _ _j6�+69142 _ 34 763 .12 _ I4)4S !0 f67 376y2 f _ 56 3*J 61 I.IABI.17'IiS AND FUND EQUITY I.IABI.ITIFS Accounts payable and other liabil6ies 1 615.313 175,377 60.490 6 671,160 S 1.306,336 Accrued 6alariesandwages 41,303 14,569 14,736 70,630 5S,200 Accrued Interest 366,316 366,316 155.395 Due to other funds 633,000 633,000 661,000 Accrued compeualedabsences 454,733 213,376 71,411 739,321 652,251 Niter loan payable 4.756.000 4.7$6,000 652.231 Certificates of participation payable net of discount_ __--L1 10,670596 _ _ _ _ 10,670596 6,746.213_ TOTALLIABILITI:S 1.339 11.442256 3.5 57,610 16.111244 12.6331+6 FUND EQUITY Retained eamin0 17,357,792 23,321564 6 766_00 49,463,436 44,335105 TOTALFUNDEOUITY 17,357,792 23.321564 6.766,060 49.465,436 44,33S10S TOTAL LIABILITIES AND FUNDSOUf1Y S 102 X74 763!! 0 H.Sq.720 S 67,576162 S 56,969231 See accompanying frsdepaWad wilitors'repod. 1 ; r+. m F _ o •� a Zf r •• o o r,�o 7. $ T� S $i, � � •�• x �a111PA pII OZ 9#$_iaxjo f s s R U , w N r r P QCC Vi O C iWS L W 0 Z < p v O C °° Z 2: o tA Y ✓� E O J �i : 2 O Y� O yZ ri c .Zt o e yya s` t z r 2 a Y s ce U d. I ✓, _ {iDj q2 {tD� La 0 C O z Q x Cub Dow sum operating W hAles: Operating Incame M(uameaa to recotcik opwating income to net caab prodded by operating saiWla: Depreciation and amanizalon Chant in awn and 19aWkia: lactase in loan reedrable (Inrraw) Decrease In weaws raaab5e (Increase) Down" In he wait r«dnble (Inrttaw) Decreaw In Inventory Incrmw in dt(med fimw3ngccata Decrease (Increase) in *bar ams Races" in low payable Inxasa(DeQaac) in accounts payable and caber HabMW lweaw In wriaand ruga increase in wa%W ksares Inrase in a tauadcompenswed asaenca lwe w in accrued lnsunncc0aims Dwrcaw (Itrseaw) In dw firm tabor IwWa Decreaw in dw towbar funds Na Garb proudW (wed) by opwaing acomia Cash 00►1 from namopkl finwin6 aw*ia: Operating waW.ra lo(ou) lawtase In noxperaing re%"wv Na cash prodded by amcapkd finandngacalWies Crib now from capital financing 1a1W la: Cub Transfwted to Trat t Na Prete ads of Cert IfwAc o(prtkipatlen IUUW Acquis6lon and constrwim *(capital alas P"M of CanUkat o(partkipatlon 1*% -two Na cash used by capital nnancing aalW la Cash now from Inwalog 011 W3u: Prnings from Im ama is Na cash prm4ded by In-wris sairitia Na Incase (Decrease) In east and cub equialwes Crib and cab tgalmd nta a beglrming o(year Cub and cab tquiasaaa a and oyer 800 accompanying notes 10 Cts general purpose flnamiai staemsnb. CRY OF LODI Combining Saamacas of Casb Plo" 8aatpriaa puitda Yew Boded Jane 30,1M2 y 53 Taste Tad Internal Memoreoduas idlNii£ iKSR Watr FdllJl-4! ate! 991 2307,486 233291 7355" 32763/3 (1.113370) 2.162779 6e49" 77S."l 363322 1196420! 11"6.203 (1,253,07)) (1,257G73) (12S)A73) (107,276) 1,166 (0.910) (I116)4) 4" (114170) (12,126) 1.170 13,712 1,754 1,751 (",906) 2.617 2,731 (91336) (94351) (271,732) 211 (2.710) 141 (2325) (936/) (11.602) 1,756,000 1,750,000 75&000 16.134 (190,331) 44,6M (437,14) 221) (13x.913) 10367 2,420 2.421 13,471 73 15.504 12.921 12.92I 12.321 16,936 27,114 11200 17.270 87.270 602776 4Q2774 293.333 (",761) (33.0w) 0&572 138372 (231.000) 1231.000) (271,000) 3304310 161"6 1305,760 $,11&730 (319357) 4,629,17) (2.745392) (345.747) (761701) ()A93A63) 41LI45 (3,1112,75s) 183AOS 72&"7 67,10 900.912 999,912 (2.359367) 363.234 (69736) (2A9a.921) 41LIOS (2,42,916) (9,9)5260) (9,93526) (9,93326) 10,911345 10,941313 10,941315 (7240") (227SAM) (5376.996) 137:."» (4372.961) (110.000) _ (110.") _ _.x&"01 (722.0") (1371381) (1.176.9") (3276.676) 0 ()276.476) 382,210 (193,667) 67334 2$4077 275,973 5320110 38;210 (19067) 67334 254077 273,97) 534050 1046)4 (1,013,106) (425.25) (1,037322) 167321 (170,000) 7,9W27 6,08&526 1,062,930 11239.943 1,763372 12.903235 439531 --.i .063./20 N1S{0 10w16ill 1.030.1193 12.93723/ y 53 CO r. f - Z W W E- CO w Q 0 F- CO Z LL -- Q W Z a: W LL Cl) Q Q F- Z Z (r W W W Z a. CL i OVERVIEW Internal Service Funds are maintained to account for the internal transfer of goods and services between operating units of the City. The purpose of an Internal Service Fund is to achieve a level of operating efficiency that may not be available if the same activities were performed by multiple organizations. The City of Lodi maintain an internal service fund to account for insurance and certain employee i benefits. i Long Term Disability Self Insurance Medical Self Insurance Employee Benefits (Dental) Public Liability and Property Damage Workers Compensation Self Insurance 56 J ti V �t cp 'C; i� > N N N M N < Y Z � 3 1 Call, Q F a ` ' .�. �}' n r� ^ p h N O N .. .� OD •• N p: if• O ` e N T i CL O N N ? N N y � i e7 ` 6 N N N N w Z o m F x, N 22 4 ,» . u Lcl w til UJt r o O <LU D a Z N Z C 3" d ul G -40, �... V c w w til cr J U C C m m<< to Z aC F J t>o CITY OF LODI COMPARATIVE STATEMENT OF REVENUES, EXPENSES AND CHANGES IN RETAINED EARNINGS — INTERNAL SERVICE FUND Jame 30, 1992 (rills comparslire 101616 ret hese 30, 1991) 1992 — 1991 OPERATING REVENUES Charges 101 services $ 881,1% S 951 ,559 OPERATING EXPENSES Pcnomal smires 133,032 81,940 Supplies, materials, and sersices 1.569,560 700,907 Besero payments :93,170 263.171 TOTAL OPERATING EXPENSES 1,9%,766 1.016,021 OPERATING LOSS (1,1 li,S T0) (194,463 NONOPERATI NO REVENUES laterest reweave 126,601 147,188 Other 149,376 12,719 TOTAL NONOPERATINO REVENUES 27$,977 219,907 INCOME BEFORE OPERATING TRANSFERS (83093) 25,044 OperallmR transfers, act 811,103 302,705 Net (im) YCome (4244U) 32$149 RETAINED EARNINGS - BEGINNING OF YEAR 447,626 119,077 RETAINED EARNINGS — END OF YEAR f 19,13R f _ 107,626 See awompsaying Wepeadeal ndito", report, 58 J t>o SUPPLEMENTAL FINANCIAL STATEMENTS TRUST AND AGENCY FUNDS OVERVIEW The City of Lodi has established the following expendable trust and agency funds, which are used to account for funds held by the City in a trustee capacity or as an agent for private individuals, organizations, or other governmental agencies: Expendable Trust Funds Hutchins Street Squarc Bequest This fund was established to account for assets held by the City as trustee. The principal and earnings of the trust can he spent by the City in accordance with the trust agreement on behalf of Hutchins Street Square. Agency Funds Deferred Compensation Fund This fund was established to account for assets held by the City's agent on behalf of City employees under a Section 457 Plan of the Internal Revenue Code. Special Assessments This fund was established to account for special assessments collected on the property tax roll by the City on behalf of the property within the Industrial Way Beckman and Turner Cluff Assessment Districts. t.1ABII.iiITS AND FUND BALANCE 1-IABILITIGS Accounts payable and other GabilYiee Deferred compensation funds TOTAL LIABILii1E.5 FUND BALANCE Fund equity (defici) unreserved — desitnaled TOTAL FUND BALANCE TOTAI. LIABILITIES AND FUND BALANCE See accompanying indepeadenl sud'eon' repod, 1 3611:b { Mekl:a t Iv; IH _-- 8.39:.061 ftJ92.061 1,�{ ,M 1 __1,740 qy 1Oq,SUil 1 19 CITY OF LORI COMBIHING BALANCE SI W= — TAtW AND ACt(NCY FUNDS Su" 30.199= (wit! towpwatiaa 10/31; fat hne 30,19!1) Deterred Specs( IW HO,&St Tolab Coransarkpt Assetseltelt ASST TS ( ash and Inmimews 1 3.39;.061 ?sLo:s to gs { 9.1nJ1; 1 a Mal Rmciwbks (net of ailm-wwc for unroll«Ubks),. Accounis 1,1'C 1,19; S sya Intcresl _bp TOTAI.ASS!•i'S 1-........saa'a.`�e.. ..,....--....4t1•a :M { t.1ABII.iiITS AND FUND BALANCE 1-IABILITIGS Accounts payable and other GabilYiee Deferred compensation funds TOTAL LIABILii1E.5 FUND BALANCE Fund equity (defici) unreserved — desitnaled TOTAL FUND BALANCE TOTAI. LIABILITIES AND FUND BALANCE See accompanying indepeadenl sud'eon' repod, 1 3611:b { Mekl:a t Iv; IH _-- 8.39:.061 ftJ92.061 1,�{ ,M 1 __1,740 qy 1Oq,SUil 1 19 —I � j I ■ § � . ■ ■ 2 . v � < . :6£ — �§ k _ 1-§ . § 33 a � �kE2 k Ego . 1. Xkk� Q ' § § - ; . = 3§ | ■� . # _ 2 . cc . � : Q —I ( $ §. k § x \ ■ o � i � < § � 10. j § • $ $ y LU. - - z � ju CA _ LU go, -13 tu j \ u z V2 cc § � 0 0 / � - ~ / § k � 2 —I Rrail krot tia7lui s "ra strtGrL CR'li fmc "1:11 "Of 1t 00 L fit ft;t 0ws 000 h?I000 ia11 :Jal Mol krot tia7lui s "ra Ar't CR'li fmc 0 "Of twol f {1. 0W /:tvk ,"' . _. MI —. Mi_ NII _— LI'1 Nt'r ows lirli f1Y'11 LW'i: C.'aL f M►K/ tttlil 11: L9i f 190'BiL't tMY'f% 119'9if'L S a�Y a�lell Id IftO K sN4„nl l L •yodas uoMPn• luapuadapu 14AWwom sn MNY1Va aNnd CNV salt 18v1'1 1vJA1 Paleldtlsap _ pwawun alge(ed winoadwoapaualaa talt!p4"JayaPut algL4tds1u wv 3NJY1V8 CNnd CNV 531.1111OVII SJ.3SSV'iV.lol ltw.,Iul lluno W 1 "Mallon io) aaue,sk+llelo tau) salgeuaw-d sluawlsmu! Pue W3 S.L:ISSV 39NYIVfl CNn:1(INV S11 II'11I1Vl"I'IVlht aRtkd uu, muaJwoa pauala(I SAPP M s-Mlo Ptm ageted llunoa V 3JNYIvfl 0.414 ONY S:lll.l'llHvl'1 SUSSV'IVla.L alyas!avi Isasalul gsnwlsA%W pue Msr) SL:ISSV _ • IM'dK'0 9rr'sN SF9'KYL ::1 ML llLtts 01,101. laf'W /:tvk ,"' . _. "W",.--t►t'isl .. _._:M._.t ..._ ._....-_ _-- is ( M:'s•-�OL�L�y...., .r._._ s in --------- — ---`� •:Y:•t M►K/ tttlil 11: L9i f 190'BiL't tMY'f% 119'9if'L S iKM .lb'01/90 MIol lanpaQ �~wq/pPV Id IftO itll'OC •••! Cciwasm omv SLH=v NI L'trunmo do JmmaLVJS ONINIflwri SUMM AOIM:tOV K Mn dO AJJO L •yodas uoMPn• luapuadapu 14AWwom sn MNY1Va aNnd CNV salt 18v1'1 1vJA1 Paleldtlsap _ pwawun alge(ed winoadwoapaualaa talt!p4"JayaPut algL4tds1u wv 3NJY1V8 CNnd CNV 531.1111OVII SJ.3SSV'iV.lol ltw.,Iul lluno W 1 "Mallon io) aaue,sk+llelo tau) salgeuaw-d sluawlsmu! Pue W3 S.L:ISSV 39NYIVfl CNn:1(INV S11 II'11I1Vl"I'IVlht aRtkd uu, muaJwoa pauala(I SAPP M s-Mlo Ptm ageted llunoa V 3JNYIvfl 0.414 ONY S:lll.l'llHvl'1 SUSSV'IVla.L alyas!avi Isasalul gsnwlsA%W pue Msr) SL:ISSV I SUPPLEMENTAL SCHEDULES GENERAL FIXED ASSETS GENERAL LONG-TERM DEBT OVERVIEW General Fixed Assets Account Group All of the City's fixed assets of a tangible nature, except those relating to the proprietary fund types, are accounted for in this Account Group. As these assets arc not financial resources available for expenditure or appropriation, they are not accounted for with Governmental Funds, but as an account group, and exist solely as accounting records of the City's fixed assets. The City's gencrul fixed assets have been accounted for at cost, and do not include public domain or infrastructure fixed assets such as roads, bridges, storm drains, or sidewalks, as these assets arc immovable and only of value to the City of Lodi. General Long Term Liability Group All of the City's long term liabilities (non—current debt), except those relating to the proprietary funds, are accounted for in this Account Group. These liabilities are backed by the full faith and credit of the City, which means that the debt is secured by the general taxing authority of the City. Included in long—term debt are: Debt instruments Bond Anticipation Notes Demand bonds Loss contingencies Compensated absences • Special termination benefits • Leases Pensions !d r A C rte. q V: N, rii = 0C4� = Q ll N v r C, o Q o r aEk'i` o r! CO N Ii R 1i N — Q ci O� u _ .� z O � u � . � a � N Y 00 v O e 0 (} Y y n O e D T u; o :� > •� C N_ C O c m Q Y O � c D. 9 i O Q U C C O W e C D L w u D ._ Y % w. _ O EY Y H D '2 Ij R C L v u c U U In L rn r o ca r .3 O u C G W 5 G Y u u < C7 �. W7 M M 3 STATISTICAL TABLES UNAUDITED 1 71 J la 1. I- .s L i V�z L:....>r G General Governmental Expenditures includes General, Special Revenue, Debt Service and Capital Projects Funds. Excludes Expendable Trusts. SOURCE: City Finance Department CITY OF LODI GENERAL GOVERNMENTAL REVENUES BY SOURCE LAST TEN FISCAL YEARS (A«624 is rwwwn Licenses Charges Fines, Forfeits Use of Fiscal and Intergovein- for and Money 6 Misc _ Year Total _ Taxes _ Permits Y mental Services Penalties Property._ Revenue 1982-83 12,374 6,229 234 2,048 1,768 278 1,022 795 1983-64 13,538 7,843 241 1,472 1,976 254 980 772 1984-85 15,700 7,248 365 3,290 2.235 164 2,052 346 1985-86 17,052 7,724 367 4,035 2,390 216 2,048 272 1986-87 17,344 8,297 371 3,592 2,478 311 1,667 628 1987-88 17.992 9,079 427 3,067 3,027 316 1,675 401 1988-89 19,469 9,393 470 3,261 3,770 338 1,558 679 1989-90 21,238 10,409 460 3,964 3,966 282 1,438 699 1990-91 22,454 10,623 545 4,134 4,062 341 1,407 1,342 1991-92 24,987 11,556 420 5,213 5,003 252 1,385 1,157 General Governmental Expenditures includes General, Special Revenue, Debt Service and Capital Projects Funds. Excludes Expendable Trusts. SOURCE: City Finance Department 1 CITY OF LODI GENERAL GOVERNMENTAL EXPENDITURES BY FUNCTION LAST TEN FISCAL YEARS (A -..I b Tro„NWq Fiscal General Public Public Parks 6 Debt Capital Year Total___ Government Safety _ Works Sanitation Ubr!!fy Recreation Service OutlsY__ 1982-83 13,825 1,731 4,206 1,772 1,281 445 1,141 724 2.525 1983-64 15,441 1,707 4,559 1,883 1,523 474 1,230 454 3.611 1984-85 17,231 2,004 4,954 1,760 1,669 610 1,520 457 4,257 1965-86 18,751 2,296 5.462 2,048 1,824 695 1,394 524 4,508 1986-87 19,164 2.346 6,096 1,991 2.202 635 1,503 451 3,938 1987-88 20,857 3,082 6,796 2,182 2.757 654 1,695 456 3.235 1988-89 23,775 2,837 7,574 4,446 3,164 738 2.084 475 2,457 1989-90 23,567 3,839 7,956 3,284 3,385 768 2.265 399 1,651 1990-91 26,137 4,209 9,141 4,301 3,449 904 2,485 406 1.242 1991-92 28,204 5,186 9,903 4,204 3.424 949 2.632 395 1,513 General Governmental Expenditures Includes General, Special Revenue, Debt Service and Capital Projects Funds. Excludes Expandable Trusts. SOURCE: City Finance Department 69 t [WA Fiscal Year 1982 - 83 1983-84 1984-85 1985 - 86 1986-87 1987-88 1968-89 1989-90 1990-91 1991-92 CITY OF LODI GENERAL GOVERNMENTAL TAX REVENUES BY SOURCE LAST TEN FISCAL YEARS (Arrau ie 7bwaeds) (1) Credited lo Oeseral Fsad. SOURCE: City Name Departsest State CosuclleT Report Documentary Motor Veh . Transfer Soles Transient 186 property - & Use - Occupancy Franchise 1,942 2,693 62 133 1.926 3,249 63 141 2,190 3,449 71 164 2,392 3,616 76 177 2.762 3,925 110 155 3,158 4,264 119 164 3,356 4,526 136 192 3,902 4,970 144 210 4,348 4,962 151 238 4,620 4,909 200 235 (1) Credited lo Oeseral Fsad. SOURCE: City Name Departsest State CosuclleT Report Documentary Motor Veh . Transfer in Lieu 35 186 56 188 61 924 72 1,181 83 1,298 85 1.460 100 1,666 112 1,746 98 1,787 79 1,799 70 Business Cigarette License Total J 121 66 5,238 122 74 5,821 128 78 7,065 133 78 7,725 133 85 8,551 123 89 9,462 117 91 10,184 107 96 11,267 90 93 11,767 43 95 11,960 SOURCE: Oty Finance Department CITY OF LODI SECURED TAX LEVIES AND COLLECTIONS 71 LAST TEN FISCAL YEARS (A—Yn4 N'FUYMW.) , Percent Total Current Year's Percent of Delinquent Total of Total Fiscal Tax Tax Collections Tax Tax Collections Year Levy Collections to Tax Levy _ Collections Collections to Tax Leyy 1982-83 2,104 1,574 74.8% 29 1,603 76.2% 1983-34 2,248 1,710 76.1% 86 1,796 79.9% 1984-85 2,273 1,935 85.1% 99 2,034 89.5% 1965-66 2,545 2.133 83.8% 97 2.230 67.6% 1986-87 2,883 2.404 83.4% 112 2.516 87.3% 1987-88 3,153 2,693 85.4% 191 2,884 91.5% 1988-89 3.569 2.886 80.9% 90 2.976 83.4% 1989-90 31965 3,296 82.7% 204 :500 87.8% 1990-91 4,286 3,847 89.8% 351 4,188 97.9% 1991-92 4,175 4,105 98.3% 169 4,274 102.4% SOURCE: Oty Finance Department 71 r , Fiscal CITY OF LODI Less Net Assessed T Year Land ASSESSED FULL CASH VALUE OF ALL TAXABLE PROPERTY Total Exemptions Value 1982-83 LAST TEN FISCAL YEARS 655,511 83,521 960,803 100,569 660,234 1983-84 (Amount In T6ouue4a) 702.190 82,735 1,026,004 Fiscal Secured Utility Unsecured Tax Less Net Assessed Yost Roll Mineral Roll Roll Roll Etertt lion Value 1982-83 880,404 29,632 50,767 980,803 100,589 860234 1983-84 939,821 31.455 54,726 1,026.004 101,021 924,983 1984-85 1,054,386 32,779 61,812 1,148.977 103,827 1.045.150 1985-86 1,171,959 36.845 67,723 1,276.527 105,657 1,170,810 1986-67 1,323,239 39,917 72,211 1,435,367 110,029 1,325,338 1987-88 1,442,628 41,897 83,863 1,568,408 123,842 1,444,566 1988-•89 1,615,433 4,294 89,342 1.709.069 127,256 1,581,813 1989-90 1,799281 72 4,190 116,232 1.919,775 143267 078.508 1990-91 1,948,698 12 2,712 99,114 2.050,536 145,148 1,905,388 1991-92 1,945.238 12 2.748 102,727 2,050.725 88,774 11961,951 Fiscal Personal Less Net Assessed T Year Land Improvements property Total Exemptions Value 1982-83 221,77t 655,511 83,521 960,803 100,569 660,234 1983-84 240,379 702.190 82,735 1,026,004 101,021 924.983 1984-85 268,250 751,446 101,281 1,146.977 103,827 1,045,150 1985-86 303,161 870,166 103.200 1,276,527 105.657 1,170.870 1986-87 338,464 972,458 124,425 1,435,367 110,029 1,325,338 1987-88 374,723 1,059,597 133,988 1,568,408 123,842 1,444,566 1988-89 415,277 1.118,903 174,889 1,709,069 127956 1,581.813 1969-90 459,095 1,237,487 223,193 11919,775 143,267 1,776.506 1990-91 507,046 4,358,641 184,649 2,050,538 145,148 1,905,386 1991-92 561,505 1,461,124 180,665 2,203.294 88,774 2,114.520 SOURCE: San Joaquin County Assessor's Oft@ City Finance Office Central Filar - Properly Tues 72 CITY OF LODI PROPERTY TAX RATES -- ALL OVERLAPPING GOVERNMENTS LAST TEN FISCAL YEARS SOURCE: San Joaquin County Auditor/Controller's ONce 73 Basic Fiscal County -Wide Year Levy City School All Other- ther1962-83 1962-83 1.0000 0.0195 0.0623 0.9182 1983-84 1.0000 0.0198 0.0628 0.9174 1984-85 1.0000 0.0205 0.0636 0.9159 1985-86 1.0000 0.0209 0.0636 0.9155 1986-87 1.0000 0.0221 0.0651 0.9128 1987-88 1.0000 0.0226 0.0653 0.9121 1988-89 1.0000 0.0245 0.0%,.,' 0.9095 1969-90 1.0000 0.0240 0.0659 0.9101 1990-91 1.0000 0.0240 0.0659 0.9101 1991-92 1.0000 0.0235 0.0657 0.9108 SOURCE: San Joaquin County Auditor/Controller's ONce 73 SOURCE: City Finance Department a 1 CITY OF LODI SPECIAL ASSESSMENT BILLINGS AND COLLECTIONS LAST TEN FISCAL YEARS (Aeoanr M TUads) Tot at Collection Total As Percent of Outstanding Current Current Current Current and Fiscal Assessments Assessments Assessments Delinquent Year Due Collected Due Assessments 1982-83 346 161 46.5% 185 1983-64 284 270 95.1% 14 1984-85 315 299 94.9% 16 1985-66 308 277 89.9% 31 1986-87 294 263 89.5% 31 1987-88 284 277 97.5% 7 1988-89 269 247 91.8% 22 1989-90 183 177 96.7% 6 1 n90-91 162 178 97.8% 4 1991-92 178 140 78.7% 38 SOURCE: City Finance Department a 1 -1 SOURCE: State Controller's Office City Finonoe Depanment , 75 t CITY OF LODI RATIO OF NET GENERAL BONDED DEBT TO TAXABLE ASSESSED VALUE AND NET BONDED DEBT PER CAPITA LAST TEN FISCAL YEARS 4AMYN61e newW.) Debt Payable Gross Gross From Net Percent of Net Net Fiscal Assessed Bonded Enterprise Bonded Bonded Debt to Bonded Debt Year Population Value Debt Revenue Debt Assessed Value Par CaEite 1982-83 36,928 960,603 4,065 4,065 0.4231% 110.08 1983-84 38,318 1,026,004 4,141 4,141 0.4036% 108.07 1984-85 39,475 1,148,977 3,822 3,822 0.3326% 96.62 1985-86 41,281 1,276,527 3,482 3,482 0.2728% 84.35 1986-87 43.293 1,435,367 3,133 3,133 0.2183% 72.37 1987-86 45,794 1,568,408 2,759 2,759 0.1759% 60.25 1988-89 48,042 1.709,069 11,287 8,917 2.370 0.1387% 49.33 1989-90 49,221 1,919,775 10,912 6,834 2,078 0.1062% 42.22 1990-91 52,539 2,050,536 10,247 8,748 1,501 0.0732% 28.57 1991-92 53,000 2,050,725 12,375 11,170 1.205 0.0588% 22.74 SOURCE: State Controller's Office City Finonoe Depanment , 75 t I. - co m W O W Z O m <J S W 2 W O O 2 CL aty � 5W o Q J W W > O O O O Y W F C Z V <� F- U 4J Ct 0 O 2 H F CL CL 2 O U 8 S ! O N tD O � 0 0 • • V 0 0 o 0 .` n! O on a 0 N % ciO F ^O < C O C sf no O m ►� 1- W q O LUC C V n 0 > O _ c o a CO c cv t d n n c 116-o O O . O N , n _ w " U. O CY B Z • <o a A p � 0. `e p ]S o E Z H t < a a c O 0 C7 :3 a Ow r a = Tx 3 U. 0 O C3 w c O • `e • LL mG Q O 0 9 u . > O e a r U o ui �W ,� p m a a Z 5Ir o c s < tii O O 0 Z o O � W a • M 0 0 Q O F N O 73 LL E =. t! M 0 SOURCE: City Finance Department 78 CITY OF LODI RATIO OF ANNUAL DEBT SERVICE EXPENDITURES FOR GENERAL BONDED DEBT TO TOTAL GENERAL FUND EXPENDITURES LAST TEN FISCAL YEARS (AwYYI (� Te0YMY1/1 Total Percent of Total General Debt Service Fiscal Debt Fund to General Fund Year _ Principal _Interest Service _Expenditutes _ Expenditures 1982-83 106 71 177 9,285 1.91% 1963-84 108 67 175 10.481 1.67% 1984-85 112 62 174 11.696 1A9% 1985-86 119 58 177 12,840 1.38% 1966-87 121 54 175 14.041 1.25% 1987-88 130 49 179 15.988 1.12% 1988-89 132 43 175 17,917 0.98% 1989-90 136 38 174 19,140 0.91% 1990-91 145 33 178 21,704 0.82% 1991 -92 147 27 174 23,251 0.75% SOURCE: City Finance Department 78 CITY OF LODI REVENUE BOND COVERAGE LAST TEN FISCAL YEARS Net Revenue " See footnote on refinancing of COP SOURCE; City of Lodi Finance Department 1 Direct Available Current Fiscal Year's Fiscal Gross Operating For Debt Debt Service Requirements Year Revenue Expense Service Principal__ _ Interest Total _ CovereQa 1982-83 1,293,430 814,852 478,578 0 0.00 1983-84 1,101,960 912,027 189,933 0 0.00 1984-85 1,810,979 884,878 926,101 aR 0 0.00 1985-86 1,877,451 1,118,111 759,340 0 0.00 1986-87 2,378,602 1,395,754 982,648 0 0.00 1987-88 3,522,881 2,100,973 1,421,908 210,597 70,367 280.964 5.06 1988-89 4.361,188 1,557,995 2,803,193 401,420 238,125 639,545 4.38 1989-90 4.258,668 1,545,378 2,713,290 751,762 139,073 890,855 3.05 1990-91 4,469,892 2,472.929 1,996,963 726,179 249,991 978,170 2.05 • 1991-92 4,137,375 3,359,251 778.124 0 120,873 120.873 6.44 " See footnote on refinancing of COP SOURCE; City of Lodi Finance Department 1 79 aR CITY OF LODI DEMOGRAPHIC STATISTICS LAST TEN FISCAL YEARS SOURCE: Slate of California, Department of Finance, Demographic Research Unit. City Finance Department Budget K 80 PI City Population San Joaquin Population Rank In Was Fiscal Square Percent County Percent of California year- Miles Population Change _ Po up lation _ of County Cities --- 1982-83 8.76 36,928 3.6% 369,300 10.0% 121 1983-84 6.76 38,315 3.6% 381,500 10,0% 119 1984-65 9.04 39,475 3.0% 390,638 10.1% 118 1985-86 9,30 41,261 4.6% 407,500 10.1% 116 1986-87 9.30 43,293 4.9% 423,154 10.2% 115 1987-88 9.45 45,794 5.8% 435.700 10.5% 113 1988-89 9.45 48,042 4.9% 451.000 10.7% 112 1989-90 9.45 49,221 2.5% 460,227 10.7% 111 1990-91 10.70 52,539 6.7% 470,934 11.2% 113 1991-92 11.30 53,000 0.9% 480,628 11.0% 113 SOURCE: Slate of California, Department of Finance, Demographic Research Unit. City Finance Department Budget K 80 PI CITY OF LODI CONSTRUCTION ACTIVITY LAST TEN FISCAL YEARS SOURCE: City Community Development Department 181 Number of Estimated Fiscal Building Permits Percent Valuation Percent Year A Issued Change 114u.w.r.l Change 1981 551 4.95% 26,382 4.73% 1982 708 28.49% 31,154 18.09% 1983 937 32.34% 36,383 16.78% 1984 983 4.91% 38,199 4.99% 1985 1079 9.77% 74,812 95.85% 1986 1230 13.99% 65,363 —12.63% 1987 1249 1.54% 70,826 8.36% 1988 1218 —2.46% 56,660 —92.01% 1989 1332 9.36% 50,938 —10.10% 1990 1279 —3.98% 40,634 —20.23% 1991 1300 1.64% 27,009 —33.53% SOURCE: City Community Development Department 181 t i i CITY OF LODI BANK DEPOSITS LAST TEN FISCAL YEARS I i (Amost M Millions) I I SAVINGS j Fiscal AND CREDIT Year BANKS LOANS UNIONS 1982/83 i 307,183 141,092 3,635 1983/84 345,628 253,985 4,642 1964/85 389,792 573,196 6,022 1965/86 436,060 1,058,496 9,220 1966/87 458,250 960,062 12,439 1987/88 480,454 1,228,694 15,418 1988/89 492,636 282,339 14,111 1989/90 540,545 267,501 12,813 1990191 891,877 183,936 12.465 1991/92 649,252 198,756 13.993 SOURCE: Glitorsii Slaw Ikpsrtsestof Besting — Licensing A Statistics Sail" 82 J CITY 01" LODI PRINCIPAL EMPLOYERS JUNE 30, 1992 Employ,( Activity Employees Lodi Unified School Dist. Education 2.247 General Mills Cereals and Food Mixes 897 Pacific Coast Producers Can Manufacturer and Cannery 300-1500 Lodi Memorial l lospital Ilealth Care G0 City of Lodi Government 380 Valley Industries Trailer bitches 3q() Guild Winery wines, Brandy and Champagne 212 Claude C. Wood Co. Building materials, cement 190 Interlake"I Fab Machine Fabrication 185 Farmers and Merchants Bank Banking 183 RM Holtz Rubber Products 170 Mervyn's Retail 170 SOURCE: City of Lodl 83 { � _ i � r 3 f i � 7 .i i I `• i i CITY OF LODI SURETY BONDS OF PRINCIPAL OFFICIALS JUNE 90, 1992 City Manager $500.600 AssiAeM City Manager 500,000 City Attorney 500,000 City Clerk 500,000 Public Works Director 500,000 Police CNet 500,000 Fire Chef 500,000 Finance Director 500,000 Community Development Director 500,000 Electric Utilities Director 500,000 Community Cerner Director 500,000 Parke and Recreation Director 500,000 Personnel Director 500,000 City employees are covered by a commercial 6edelRy, bond amounting to s maximun of $500,000 per lose, SOURCE: City Finance Department 84 1 • Not available SOURCE: City Finance Department, Central Files CITY OF LODI GANN APPROPRIATION LIMITATION 85 as of 6130192 FISCAL LIMIT CPI or POPULATION GROWTH APPROPRIAION BUDGET SUBJECT YEAR BASE INCOME GROWTH FACTOR LIMITATION TO LIMIT VARIANCE 1982/63 15,198.951 1.0912 1.0196 1.1126 16,855,637 • 18,855,637 1983/84 18,855,637 1,0235 1.0399 1.0643 17,939,454 • 17,939,454 1984/85 17,939,454 1.0474 1.0363 1.0854 19,471,483 • 19,471,483 1985/86 19,471,483 1.0374 1.0404 1.0793 21,015,572 11,066,825 9,948,747 1986/87 21,015,572 1.0538 1,0230 1.0781 22,654,787 15,386,513 7.268,274 1987/86 22,654,787 1,0304 1.0572 1.0894 24,782,072 0 24,782,072 1968/89 24,782,072 1.0393 1.0496 1.0908 27,223.106 16,178.704 11,044,402 1989190 27,223,106 1.0498 1,0252 1,0763 29,357,396 16,746,795 12,610,603 1990/91 29,357,398 1.0421 1,0226 1.0657 31,286,179 17,847,059 13,439,120 1991/92 31,266,179 1.0414 1.0264 1,0689 33,441,797 22,048,896 11,393,101 • Not available SOURCE: City Finance Department, Central Files 85 UEPARTMRNT Administration Communily Development Electric Utility Finance Department Fire Dcpartment Library Parks R Recreation Police Departmeat Public Works Department Total SOURCE: City o(LodiFioaaceDepanseat tsi CITY OF LODI PERSONNEL AUTHORIZED LAST TEN YEARS JUNE 30, 1992 1982/83 1983/81 1981/85 198S/86 1986/87 1987/88 1988/89 1989/90 1990/91 199I/92 9 9 10 12 12 12 13 15 17 17 8 8 10 10 11 11 11 11 11 11 27 27 28 28 31 31 17 39 41 41 26 27 28 28 32 34 3S 38 40 40 SO 48 48 48 49 48 49 49 49 49 II 11 13 13 13 13 14 14 IS IS 21 26 26 26 28 29 31 32 34 34 66 70 72 7S 94 91 91 98 104 105 67 67 69 _ 73 76 80 81 90 _ 9S 285 293 304 _ s 313 33S _ 349 X365 s_n— -006 107 SOURCE: City o(LodiFioaaceDepanseat tsi