ur cafr cover - redmond, or
TRANSCRIPT
1910 2010
city of
oregon REDMOND
Annual Financial Statements For the Fiscal Year Ended June 30, 2010
716 SW Evergreen Avenue Redmond OR 97756
541‐923‐7710 www.ci.redmond.or.us
City of Redmond Urban Renewal Agency (A Component Unit of the City of Redmond, Oregon)
City of Redmond, Oregon
Urban Renewal Agency (A Component Unit of the City of Redmond)
Annual Financial Statements For the Fiscal Year Ended June 30, 2010
City Council George Endicott, Mayor
Ed Boero Joe Centanni Shirlee Evans Camden King Ed Onimus Jay Patrick
Administrative Staff
David Brandt, City Manager Sharon Harris, Assistant City Manager
Prepared by
Summer Sears, Controller City of Redmond ‐ Finance Department
1910 2010
Annual Financial Statements – For Fiscal Year Ended June 30, 2010
City of Redmond Urban Renewal Agency (A Component Unit of the City of Redmond, Oregon)
TABLE OF CONTENTS
INTRODUCTORY SECTION
Officials of the Agency ..................................................................................................................................... iii
FINANCIAL SECTION
Independent Auditor’s Report ......................................................................................................................... 3
Management’s Discussion and Analysis ........................................................................................................... 7
Basic Financial Statements ............................................................................................................................ 15
Statement of Net Assets ............................................................................................................................. 18
Statement of Activities ............................................................................................................................... 19
Fund Financial Statements ......................................................................................................................... 20
Balance Sheet – Governmental Funds ....................................................................................................... 21
Statement of Revenues, Expenditures, and Changes
In Fund Balances – Governmental Funds ............................................................................................... 22
Reconciliation of the Statement of Revenues, Expenditures, and Changes in
Fund Balances of Governmental Funds to the Statement of Activities ................................................. 23
Notes to the Basic Financial Statements .................................................................................................... 25
Supplementary Information .......................................................................................................................... 39
Schedules of Revenues, Expenditures, and Changes in Fund Balances – Budget to Actual
Airport Urban Renewal Debt Service Fund ............................................................................................ 42
Downtown Urban Renewal Debt Service Fund ...................................................................................... 43
Airport Urban Renewal Development Fund ........................................................................................... 44
Downtown Urban Renewal Development Fund .................................................................................... 45
Audit Comments and Disclosures Required by State Regulations .............................................................. 47
City of Redmond Urban Renewal Agency
Board of Directors
1910 2010
Ed Onimus, Councilor 541‐604‐5403
Shirlee Evans, Councilor 541‐604‐5401
Jay Patrick, Councilor 541‐508‐8408
George Endicott, Mayor 541‐948‐3219
Joe Centanni, Councilor 541‐604‐5400
Ed Boero, Councilor 541‐604‐5399
Camden King, Councilor 541‐604‐5402
iii
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MANAGEMENT’S DISCUSSION AND ANALYSIS As part of this Annual Financial Report, the City of Redmond Oregon Urban Renewal Agency (the Agency), presents the narrative overview and analysis of the Agency’s financial activities for the fiscal year ending June 30, 2010. The Agency is a blended component unit of the City of Redmond, Oregon (the City) and was organized to assist in the redevelopment of blighted and deteriorated areas within the City’s downtown and south airport. This Management’s Discussion and Analysis is based on presently known facts and conditions that exist as of the date of the independent auditors’ report. Additional information outside the scope of the analysis can be found in the individual financial statements. Financial Highlights
• The South Airport Urban Renewal District was closed during the fiscal year. At that time, the District’s capital assets totaling $891,018 were contributed to the City and $1,570,000 was refunded to the taxing district.
• The liabilities of the Agency exceeded its assets at the close of the most recent fiscal year by $1,381,592. This is primarily due to the Agency holding long‐term debt associated with capital assets that have been transferred to the City.
• The Agency’s total assets decreased by $2,995,613. The primary factor of this decrease was the closing of the South Airport Urban Renewal District.
• The Agency’s total net assets decreased by $598,216 over the prior year, primarily due to the closing of the South Airport Urban Renewal District.
Overview of Financial Statements
The following discussion and analysis is intended to serve as an introduction to the Agency’s basic financial statements. The Agency’s basic financial statements include three components:
1. Government‐wide Financial Statements; 2. Fund Financial Statements; and 3. Notes to the Financial Statements.
Government‐wide Financial Statements – The government‐wide financial statements are designed to provide readers with a broad overview of the Agency’s finances in a manner that is similar to a private‐sector business.
The Statement of Net Assets presents information on all of the Agency’s assets and liabilities with the difference between the two reported as net assets. Over time, increases or decreases in net assets may serve as a useful indicator of whether the financial position of the Agency is improving or deteriorating.
The Statement of Activities presents information on how the Agency’s net assets changed during the most recent fiscal year. All changes in net assets are reported as soon as the underlying event occurs, regardless of the timing of related cash flows.
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Thus, revenues and expenses are reported in the statement for some items that will result in cash flows in a future period, such as earned but uncollected property taxes. Both of the government‐wide financial statements indicate that the functions of the Agency are principally supported by taxes and intergovernmental revenues. These functions are considered governmental activities. The Agency does not have business activities in which costs are recovered through user fees or charges.
The government‐wide financial statements can be found on pages 18 and 19. Fund Financial Statements – A fund is a grouping of related accounts that is used to maintain control over resources that have been segregated for specific activities or functions. The Agency uses fund accounting to ensure and demonstrate compliance with finance‐related legal requirements. All of the funds of the Agency are considered governmental funds.
Governmental Funds are used to account for Agency functions that are supported primarily by taxes and intergovernmental revenues. These are essentially the same functions that are reported as governmental activities in the government‐wide financial statements. Unlike the government‐wide financial statements, governmental fund financial statements focus on the acquisition and use of spendable resources, as well as the balances of available spendable resources at the end of the fiscal year. Such information may be useful in evaluating the Agency’s near‐term requirements. The governmental fund financial statements can be found on pages 21 and 22.
Because the focus of government funds is narrower than that of the government‐wide financial statements, it is useful to compare the information presented for governmental funds with similar information presented for governmental activities in the government‐wide financial statements. By doing so, readers may better understand the long‐term impact of the government’s near‐term financial decisions. Both the governmental fund Balance Sheet and the governmental fund Statement of Revenues, Expenditures, and Changes in Fund Balance provide a reconciliation to facilitate the comparison between governmental funds and governmental activities. These reconciliations can be found on page 21 and 23.
The Agency maintains four separate governmental funds. Information is presented separately in the governmental funds balance sheet and in the governmental funds statement of revenues, expenditures and changes in fund balances. The four major funds consist of the Downtown Urban Renewal Debt Service Fund, Downtown Urban Renewal Development Fund, the Airport Urban Renewal Debt Service Fund and the Airport Urban Renewal Development Fund.
The Agency adopts an annual appropriated budget for all governmental funds. A budgetary comparison has been provided for each fund to demonstrate compliance with the adopted budget.
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Notes to the Basic Financial Statements – The notes provide additional information that is essential for a full understanding of the data provided in the government‐wide and fund financial statements. They are an integral part of the financial statements and should be read in conjunction with them. The notes begin on page 27.
In addition to the basic financial statements and accompanying notes, this report also presents supplementary information concerning budgetary comparisons for the Agency’s four funds beginning on page 42.
Government‐wide Financial Analysis
As noted earlier, net assets over time may serve as a useful indicator of a government’s financial position. In the case of the Agency, liabilities exceeded assets by $1,381,592 at the close of Fiscal Year 09/10. Net assets are $598,216 less than in the prior year. The Agency’s negative net assets balance is due to the Agency holding long‐term debt associated with capital assets that have been transferred to the City. The related debt will be paid with future property tax revenue.
2010 2009 Change
Current and other assets 4,451,738$ 9,303,222$ (4,851,484)$ Noncurrent assets 5,734,805 3,878,934 1,855,871 Total assets 10,186,543 13,182,156 (2,995,613)
Current and other liabilities 1,293,137 1,955,533 (662,396) Long‐term liabilities 10,274,998 12,009,999 (1,735,001) Total liabilities 11,568,135 13,965,532 (2,397,397)
Net assets:Invested in capital assets net of related debt 5,590,430 3,732,792 1,857,638 Restricted for debt service ‐ 463,015 (463,015) Unrestricted (6,972,022) (4,979,183) (1,992,839)
Total net assets (1,381,592)$ (783,376)$ (598,216)$
City of Redmond Urban Renewal Agency ‐ Net Assets
Governmental Activities
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The following table compares program revenues and expenses for current year activities.
Fund‐Based Financial Analysis
As noted earlier, the Agency uses fund accounting to ensure and demonstrate compliance with finance‐related legal requirements.
The focus of the Agency’s funds is to provide information on near‐term inflows, outflows, and balances of spendable resources. Such information is useful in assessing the Agency’s financing resources available for spending at the end of the fiscal year.
As of the current fiscal year, the Agency’s funds reported combined ending fund balances of $3,832,210. Approximately 87%, or $3,333,597, of the balance is unreserved for spending at the Agency’s discretion. The remaining fund balance is reserved and is not available for future spending because it has already been committed to debt service.
The combined ending fund balances is $4,112,737 less than in the prior year. This is the combined result of the closing of the South Airport Urban Renewal District and, within the Downtown Urban Renewal District, the use of available resources on Agency programs.
The Downtown Urban Renewal Debt Service and Development Funds account for the accumulation of resources and payments for long‐term debt and the project construction costs
2010 2009 ChangeRevenues: Program revenues: Charges for services 42,758$ 116,359$ (73,601)$ General revenues: Taxes 3,001,331 3,047,893 (46,562) Interest and investment earnings 69,709 233,689 (163,980) Other revenues ‐ 29,963 (29,963)
Total revenues 3,113,798 3,427,904 (314,106)
Expenses:Community development 1,542,246 1,741,201 (198,955) Interest on long‐term debt 599,768 613,755 (13,987) Refund to the County upon closure of South Airport Urban Renewal District 1,570,000 ‐ 1,570,000 Total expenses 3,712,014 2,354,956 1,357,058
Increase in net assets (598,216) 1,072,948 (1,671,164)
Net assets, July 1 (783,376) (1,856,324) 1,072,948
Net assets, June 30 (1,381,592)$ (783,376)$ (598,216)$
Governmental Activites
City of Redmond Urban Renewal ‐ Change in Net Assets
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related to the Downtown Urban Renewal District. Tax increment and special levy revenues of the district are deposited to the Debt Service Fund. Consistent with state law, the tax revenues are used to leverage debt proceeds, which are placed in the Development Fund for project construction. No new long‐term debt was issued for the Downtown Urban Renewal district during the audit year.
The South Airport Urban Renewal Debt Service and Development Funds account for the accumulation of resources and payment for long‐term debt and the project construction costs related to the South Airport Urban Renewal District. These funds are structured identical to the Downtown district funds. No new long‐term debt was issued for the South Airport Urban Renewal district during the audit year. The South Airport Urban Renewal District was closed during the fiscal year, with all capital assets being contributed to the City. Upon closing, an estimate of unspent tax revenues was refunded to the taxing district. The Development Fund will carry forward a fund balance of $178,603 to the subsequent fiscal year to pay for uncompleted projects. Capital Assets
The Agency’s investment in capital assets as of June 30, 2010, amounts to $5.6 million (net of accumulated depreciation). This investment in capital assets includes construction in progress for City improvements, land, buildings, building improvements, land improvements and infrastructure. Current year additions include construction in progress and other city improvements, primarily for the Centennial Park project.
2010 2009 Change
Land 450,985$ 752,566$ (301,581)$ Construction in progress 2,466,694 2,377,543 89,151 Buildings and building improvements 394,748 602,683 (207,935) Land improvements 761,280 ‐ 761,280 Infrastructure 1,516,723 ‐ 1,516,723
Total 5,590,430$ 3,732,792$ 1,857,638$
City of Redmond Urban Renewal Agency ‐ Capital Assets,Net of Accumulated Depreciation
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Long-Term Debt
At the end of the current fiscal year, the Agency had total noncurrent liabilities of $11,059,999.
The balance due is a requirement of the Downtown Urban Renewal District. The debt
outstanding at the end of the current fiscal year consists of limited tax obligations. Under debt
covenants, the Agency must levy Urban Renewal taxes sufficient to meet annual debt service
requirements. Debt holders have a claim on urban renewal tax revenues only and not on any
other City of Redmond revenue source.
Economic Factors and Next Year’s Budget
During preparation of the budget for the ensuing fiscal year, the Agency considered current
economic factors. The following assumptions were utilized in the compilation of the fiscal year
2010-2011 budget:
• The Downtown Urban Renewal District will be considering a possible district extension.
A consultant will be hired to assist with the financial feasibility analysis and planning
requirements.
• The Downtown Development fund budget includes capital outlay for the following
projects: $350,000 for the Property Assistance Program, approximately $1.6M toward
redevelopment opportunities, and $610,000 for public parking projects. All projects are
defined in the Downtown Urban Renewal Plan.
• The South Airport Development fund budget includes amounts to complete the Odem
Medo Road improvement project. Any remaining balances in the District will be
refunded to the taxing district.
Requests for Information
This financial report is designed to provide a general overview of the Agency’s finances for
those with an interest in the government’s finances. Questions concerning any of the
information provided in this report or requests for additional financial information should be
addressed to:
Summer Sears, Controller
City of Redmond
541-923-7735
Downtown South Airport
Urban Renewal Urban Renewal Total
Limited tax issuances 11,059,999$ -$ 11,059,999$
City of Redmond Urban Renewal Agency
Outstanding Debt Distribution
2010
Basic Financial Statements Statement of Net Assets Statement of Activities Fund Financial Statements Balance Sheet – Governmental Funds State of Revenues, Expenditures and Changes in Fund Balances – Governmental Funds Reconciliation of the Statement of Revenues, Expenditures, and Changes in Fund Balances of Governmental Funds to the Statement of Activities Notes to the Basic Financial Statements
Annual Financial Statements – For Fiscal Year Ended June 30, 2010 City of Redmond Urban Renewal Agency (A Component Unit of the City of Redmond, Oregon)
BASIC FINANCIAL STATEMENTS
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The basic financial statements include inter‐related sets of financial statements as required by GASB. The sets of statements included:
• Government‐wide Financial Statements • Fund Financial Statements
‐ Government Funds
In addition, the notes to the basic financial statements are included to provide information that is essential to a user’s understanding of the basic financial statements.
CITY OF REDMOND URBAN RENEWAL AGENCY( A Component Unit of the City of Redmond, Oregon)
STATEMENT OF NET ASSETSJune 30, 2010
Governmental Activities
ASSETSCurrent assets:
Cash and cash equivalents 4,152,317$ Restricted cash and cash equivalents 105,390 Property taxes receivable 192,031 Accounts receivable 2,000
Total current assets 4,451,738
Noncurrent assets:Notes receivable 144,375 Capital assets:
Nondepreciable 2,917,679 Depreciable, net 2,672,751
Total noncurrent assets 5,734,805
Total assets 10,186,543$
LIABILITIESCurrent liabilities, payable from unrestricted resources:
Accounts payable and accrued expenses 335,202$ i bl 6 1Retainage payable 6,571
Customer deposits 17,838 Interest payable 43,135 Current portion of long‐term debt 785,001
Total current liabilities payable from unrestricted resources 1,187,747
Current liabilities, payable from restricted resources:Retainage payable 105,390
Total current liabilities payable from restricted resources 105,390
Total current liabilities 1,293,137
Noncurrent portion of long‐term obligations 10,274,998
Total liabilities 11,568,135
NET ASSETSInvested in capital assets 5,590,430 Unrestricted (6,972,022)
Total net assets (1,381,592)
Total liabilities and net assets 10,186,543$
The notes to the basic financial statements are an integral part of this statement.18
CITY OF REDMOND URBAN RENEWAL AGENCY
(A Component Unit of the City of Redmond, Oregon)
STATEMENT OF ACTIVITIES
For the Fiscal Year Ended June 30, 2010
Program Revenues
Total
Charges for Governmental
Functions/Programs Expenses Services Activities
Governmental activities:
Community development 1,542,246$ 42,758$ (1,499,488)$
Interest on long-term debt 599,768 - (599,768)
Total government 2,142,014$ 42,758$ (2,099,256)
General revenues:
Property taxes 3,001,331
Interest earnings 69,709
Special items:
Refund to County upon closure of
South Airport Urban Renewal District (1,570,000)
Total general revenues and special items 1,501,040
Change in net assets (598,216)
Net assets - beginning (783,376)
Net assets - ending (1,381,592)$
Net Expense/Revenue
and Change in Net Assets
The notes to the basic financial statements are an integral part of this statement.
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Annual Financial Statements – For Fiscal Year Ended June 30, 2010 City of Redmond Urban Renewal Agency (A Component Unit of the City of Redmond, Oregon)
FUND FINANCIAL STATEMENTS Major Governmental Funds
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Airport Urban Renewal Debt Service Fund
• The airport urban renewal debt service fund accounts for the accumulation of resources and payments for long‐term related to the South Airport Urban Renewal District.
Downtown Urban Renewal Debt Service Fund
• The downtown urban renewal debt service fund accounts for the accumulation of resources and payments for long‐term debt related to the Downtown Urban Renewal District.
Airport Urban Renewal Development Fund
• The airport urban renewal development fund accounts for services and construction costs for the development of the South Airport Urban Renewal District.
Downtown Urban Renewal Development Fund
• The downtown urban renewal development fund accounts for services and construction costs for the development of the Downtown Urban Renewal District.
CITY OF REDMOND URBAN RENEWAL AGENCY
(A Component Unit of the City of Redmond, Oregon)
BALANCE SHEET - GOVERNMENTAL FUNDS
June 30, 2010
Airport Urban
Renewal Debt
Service Fund
Downtown
Urban Renewal
Debt Service
Fund
Airport Urban
Renewal
Development
Fund
Downtown
Urban Renewal
Development
Fund
Total
Governmental
Funds
Cash and cash equivalents -$ 461,109$ 308,141$ 3,488,457$ 4,257,707$
Accounts receivable - - 2,000 - 2,000
Property taxes receivable - 192,031 - - 192,031
Notes receivable - - - 144,375 144,375
Total assets -$ 653,140$ 310,141$ 3,632,832$ 4,596,113$
LIABILITIES:
Accounts payable -$ -$ 114,000$ 221,202$ 335,202$
Customer deposits - - 17,538 300 17,838
Retainage payable - - - 111,961 111,961
Deferred revenue - 154,527 - 144,375 298,902
Total liabilities - 154,527 131,538 477,838 763,903
FUND BALANCES:
Reserved for:
Debt service - 498,613 - - 498,613
Unreserved, reported in:
Capital projects fund - - 178,603 3,154,994 3,333,597
Total fund balance - 498,613 178,603 3,154,994 3,832,210
Total liabilities and fund balance -$ 653,140$ 310,141$ 3,632,832$ 4,596,113$
Fund Balance, above 3,832,210$
Amounts reported in the statement of net assets are different because:
298,902
5,590,430
(43,135)
(11,059,999)
Net assets (1,381,592)$
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The notes to the basic financial statements are an integral part of this statement.
Interest on long-term debt is not accrued in governmental funds, but rather is
recognized as an expenditure when due.
Long-term liabilities, including bonds payable, are not due and payable in the
current period, and, therefore are not reported in the fund statements.
ASSETS:
LIABILITIES AND FUND BALANCES
Capital assets used in governmental activities are not financial resources and,
therefore, are not reported in the funds.
Some of the Agency's receivables will be collected after year-end, but are not
available soon enough to pay for the current period's expenditures and are,
therefore, reported as deferred revenues in the funds.
CITY OF REDMOND URBAN RENEWAL AGENCY
(A Component Unit of the City of Redmond, Oregon)
STATEMENT OF REVENUES, EXPENDITURES, AND
CHANGES IN FUND BALANCES - GOVERNMENTAL FUNDS
For the Fiscal Year Ended June 30, 2010
Airport Urban
Renewal Debt
Service Fund
Downtown
Urban Renewal
Debt Service
Fund
Airport Urban
Renewal
Development
Fund
Downtown
Urban Renewal
Development
Fund
Total
Governmental
Funds
REVENUES:
Taxes 940,673$ 2,130,043$ -$ -$ 3,070,716$
Rentals and leases - - 32,007 - 32,007
Interest earnings 774 11,116 18,897 38,922 69,709
Miscellaneous - - - 12,516 12,516
Total revenues 941,447 2,141,159 50,904 51,438 3,184,948
EXPENDITURES:
Current:
Community development - 1,050 45,272 583,452 629,774Capital outlay - - 350,751 2,419,359 2,770,110
Debt service:
Principal 949,999 775,000 - - 1,724,999
Interest 48,770 554,032 - - 602,802
Total expenditures 998,769 1,330,082 396,023 3,002,811 5,727,685
Revenues over (under) expenditures (57,322) 811,077 (345,119) (2,951,373) (2,542,737)
OTHER FINANCING SOURCES (USES):
Transfers in 7,809 - - 890,245 898,054Transfers in 7,809 - - 890,245 898,054
Transfers out - (725,966) (172,088) - (898,054)
Total other financing sources (uses) 7,809 (725,966) (172,088) 890,245 -
SPECIAL ITEMS:
Refund to County upon closure of
South Airport Urban Renewal District - - (1,570,000) - (1,570,000)
Total special items - - (1,570,000) - (1,570,000)
Net changes in fund balances (49,513) 85,111 (2,087,207) (2,061,128) (4,112,737)
FUND BALANCES, BEGINNING 49,513 413,502 2,265,810 5,216,122 7,944,947
FUND BALANCES, ENDING -$ 498,613$ 178,603$ 3,154,994$ 3,832,210$
22
The notes to the basic financial statements are an integral part of this statement.
CITY OF REDMOND URBAN RENEWAL AGENCY(A Component Unit of the City of Redmond, Oregon)
RECONCILIATION OF THE STATEMENT OF REVENUES, EXPENDITURES, AND CHANGES IN FUND BALANCES OF GOVERNMENTAL FUNDS TO THE STATEMENT OF ACTIVITIESFor the Fiscal Year Ended June 30, 2010
Net change in fund balances (4,112,737)$
Amounts reported in the statement of activities are different because:
Amount expended for capital assets 2,800,559 Depreciation (51,903) Capital assets contributed to the City (891,018)
Governmental funds report capital outlays as expenditures. However, in theStatement of Activities, the cost of those assets is allcoated over their estimateduseful lives and reported as depreciation expense.
Some revenue reported in the statement of activities do not provide current(71,152)
Accrued interest expense 3,034
1,725,001
Change in net assets of governmental activities (598,216)$
23The notes to the basic financial statements are an integral part of this statement.
Some expenses reported in the statement of activities do not require the use ofcurrent financial resources and, therefore, are not reported as expenditures ingovernmental funds.
The issuance of long‐term debt (e.g., bonds, leases) provides current financialresources to governmental funds, while the repayment of the principal of long‐term debt consumes the current financial resources of governmental funds.Neither transaction, however, has any effect on net assets. This is the amountby which repayments exceeded proceeds.
financial resources in the governmental funds.
Annual Financial Statements – For Fiscal Year Ended June 30, 2010 City of Redmond Urban Renewal Agency (A Component Unit of the City of Redmond, Oregon)
NOTES TO THE BASIC FINANCIAL STATEMENTS
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(1) Summary of Significant Accounting Policies
The financial statements of the City of Redmond Urban Renewal Agency have been prepared in accordance with generally accepted accounting principles (GAAP) in the United States of America as applied to government units. GAAP statements include all relevant Governmental Accounting Standards Board (GASB) pronouncements.
A. Description of Reporting Entity
The City of Redmond Urban Renewal Agency (the Agency) is a blended component unit of the City of Redmond, Oregon (the City). The City is organized under its own charter and the general laws pertaining to cities in the State of Oregon. This blended component unit consists of two districts, which were organized to assist in the redevelopment of blighted and deteriorated areas within the City’s downtown and south airport. They are financed through tax increment financing. The Downtown Urban Renewal District’s plan was adopted on September 12, 1985. The South Airport Urban Renewal District’s plan was adopted on November 28, 1989, and was terminated on March 2, 2010. The Agency is governed by a seven member Board of Directors, which is comprised of six members of the City Council and the Mayor, all of which are elected by the public.
For financial reporting purposes, the Agency has considered all potential component units for which it is financially accountable. Financial accountability may be evidenced by the ability to appoint the voting majority of the governing body, imposition of will by the primary government on the component unit, the existence of financial benefit or burden by the primary government, or intergovernmental relationships so close that the exclusion from the financial reporting entity would render the financial statements of the Agency incomplete or misleading. There were no component units that were required to be included in these financial statements.
B. Inclusion of the Agency in the City of Redmond, Oregon, Comprehensive Annual Financial Report
All significant activities and organizations for which the City exercises oversight responsibility have been included in the City’s combined financial statements. The following criteria from Governmental Accounting Standards Board (GASB) Statement No. 14, The Financial Reporting Entity, as amended by GASB Statement No. 39, Determining Whether Certain Organizations are Component Units, regarding manifestation of oversight were considered by the City in its evaluation of City organizations and activities.
• Financial interdependency – The City receives financial support or provides financial benefit to the Agency.
• Authoritative appointment of governing authority – The Redmond City Council is identical to the Agency’s governing body.
City management has determined that the Agency meets the criteria set forth above and, therefore, is a component unit of the City. Since both the Agency and the City have the same
Annual Financial Statements – For Fiscal Year Ended June 30, 2010 City of Redmond Urban Renewal Agency (A Component Unit of the City of Redmond, Oregon)
NOTES TO THE BASIC FINANCIAL STATEMENTS
28
governing board, the Agency is considered a blended component unit and is reported as if it were part of the City’s operations.
C. Basis of Presentation
The Agency’s financial operations are presented at both the government‐wide and fund financial levels. All activities of the Agency are categorized as governmental.
Government‐wide financial statements
The statement of net assets and the statement of activities display information about the Agency as a whole. These statements include all the financial activities of the Agency. Eliminations have been made to minimize the double‐counting of internal activities.
The statement of activities presents a comparison between direct expenses and program revenues for each function of the Agency’s governmental activities. Direct expenses are those that are specifically associated with a program or function and, therefore, are clearly identifiable to a particular function. Community development expenses include specific program expenses, administrative expenses related to providing those programs, and contributions of assets to the City. Indirect expense allocations that have been made in the funds have been reversed for the statement of activities. Program revenues include (a) fees, fines, and charges paid by the recipients of goods or services offered by the programs and (b) grants and contributions that are restricted to meeting the operational or capital requirements of a particular program. Taxes and other items not properly included among program revenues are reported instead as general revenues. Fund Financial Statements
These statements display information at the individual fund level. Each fund is considered to be a separate accounting entity. Funds are classified and summarized as governmental, proprietary, and fiduciary. Currently the Agency has only governmental funds. The fund financial statements provide information about the Agency’s funds which are listed below. All of the Agency’s funds are presented as major.
• The Airport Urban Renewal Development Fund accounts for the services and construction costs for the development of the South Airport Urban Renewal District.
• The Airport Urban Renewal Debt Service Fund accounts for the accumulation of resources and payments for long‐term debt related to the South Airport Urban Renewal District.
• The Downtown Urban Renewal Development Fund accounts for services and construction costs for the development of the Downtown Urban Renewal District.
• The Downtown Urban Renewal Debt Service Fund accounts for the accumulation of resources and payments for long‐term debt related to the Downtown Urban Renewal District.
Annual Financial Statements – For Fiscal Year Ended June 30, 2010 City of Redmond Urban Renewal Agency (A Component Unit of the City of Redmond, Oregon)
NOTES TO THE BASIC FINANCIAL STATEMENTS
29
D. Measurement Focus and Basis of Accounting
Measurement focus is a term used to describe which transactions are recorded with the various financial statements. Basis of accounting refers to when transactions are recorded regardless of the measurement focus.
The government‐wide financial statements are reported using the economic resources measurement focus and the full accrual basis of accounting. Revenues are recorded when earned and expenses are recorded when a liability is incurred, regardless of the timing of related cash flows. Grants and similar items are recognized as revenue as soon as all eligibility requirements imposed by the provider have been met.
The governmental fund financial statements are reported using the current financial resources measurement focus and the modified accrual basis of accounting. Revenues are recognized as soon as they are both measurable and available. Revenues are considered to be available when they are collectible within the current period or soon enough thereafter to pay liabilities of the current period. For this purpose, the Agency considers revenues to be available if they are collectible within 30 days of the end of the current fiscal period. Expenditures generally are recorded when a liability is incurred, as under accrual accounting. However, long‐term debt and compensated absences are recorded only when payment is due.
Since the governmental fund statements are presented on a different measurement focus and basis of accounting than the government‐wide statements, reconciliation is necessary to explain the adjustments needed to transform the fund based financial statements into the government‐wide presentation.
E. Cash and Investments
The Agency considers cash equivalents as all highly liquid debt instruments purchased with maturity of three months or less.
Investments included in cash and cash equivalents are reported at fair value. The Agency invests in the State of Oregon Local Government Investment Pool, which is authorized by Oregon Revised Statutes. Interest earned from pooled investments is allocated based on a fund’s portion of the total investment balance. The Agency maintains depository insurance under federal depository insurance funds and state and financial institution collateral pools for its cash deposits and investments, except the Local Government Investment Pool, which is exempt from statutes requiring such insurance.
F. Capital Assets
Capital assets, which include construction in progress for city improvements, land and buildings, are reported in the government‐wide financial statements. When capital assets are purchased, they are reported as expenditures in the governmental fund statements. Capital assets are recorded at historical cost, or estimated historical cost if actual cost is unknown. Donated fixed assets are recorded at their estimated fair market value at the time received.
Annual Financial Statements – For Fiscal Year Ended June 30, 2010 City of Redmond Urban Renewal Agency (A Component Unit of the City of Redmond, Oregon)
NOTES TO THE BASIC FINANCIAL STATEMENTS
30
The Agency generally contributes capital assets to the City upon completion, with some exceptions. Construction of Centennial Park was in process at the end of the fiscal year and the improvements will be maintained as an asset of the Urban Renewal Agency until all capital outlay related to the function of the park has been determined and completed. The 6th Street Demonstration project was substantially complete at the end of the fiscal year, but will remain an asset of the Agency until final construction sign‐off is obtained.
Capital assets are defined by the Agency as assets with an initial, individual cost of $5,000 or more and having useful lives extending beyond a single reporting period. Additions or improvements and other capital outlays that significantly extend the useful life of an asset or that significantly increase the capacity of an asset are capitalized. Other costs incurred for repairs and maintenance are expensed as incurred.
Depreciation on exhaustible assets is recorded as an allocated expense in the statement of activities with accumulated depreciation reflected in the statement of net assets and is provided on the straight‐line basis over the following estimated useful lives:
• Buildings – 50 years • Infrastructure – 50 years • Land improvements – 20 years
G. Net Assets and Fund Equity
In the government‐wide financial statements, net assets are reported in three categories: net assets invested in capital assets, net of related debt; restricted net assets; and unrestricted net assets. Net assets invested in capital assets, net of related debt represents capital assets less accumulated depreciation less outstanding principal of related debt. Net assets invested in capital assets, net of related debt does not include the unspent proceeds of capital debt. Restricted net assets represent net assets restricted by parties outside of the Agency (such as creditors, grantors, contributors, laws, and regulations of other governments) and include unspent proceeds of bonds issued to acquire or construct capital assets.
In the fund financial statements, governmental funds report reservations of fund balance for amounts that are not available for appropriations or are legally restricted by outside parties for use for a specific purpose. Designations of fund balance represent tentative management plans that are subject to change.
H. Use of Restricted Resources
When both restricted and unrestricted resources are available for use, it is the Agency’s policy to use restricted resources first, then unrestricted resources as needed.
Annual Financial Statements – For Fiscal Year Ended June 30, 2010 City of Redmond Urban Renewal Agency (A Component Unit of the City of Redmond, Oregon)
NOTES TO THE BASIC FINANCIAL STATEMENTS
31
I. Accounting Estimates
The preparation of financial statements in conformity with generally accepted accounting principles in the United States of America requires that management make estimates and assumptions which affect the reported amounts of assets and liabilities, disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates.
J. Budgetary Information
On an annual basis, the Agency prepares a proposed balanced budget which includes estimated revenues and expenditures. Estimates are made by line item and summarized by cost center, appropriation category and fund level. The proposed budget includes actual results for the prior two fiscal years and the current and proposed fiscal year budgets.
The proposed budget is presented to the City of Redmond Urban Renewal Budget Committee which consists of the seven members of the Redmond Urban Renewal Board and seven Redmond citizens. The Committee is tasked with reviewing the proposed budget and amending it where desired. The Budget Committee meetings are public meetings and an opportunity for citizen comment is available. City staff attends the meetings to provide technical analysis and support to the committee.
At the conclusion of the budget meetings, the Committee approves a balanced budget that is forwarded to the Urban Renewal Board for adoption.
Prior to the adoption of the final budget, the Urban Renewal Board must hold a public hearing on the budget forwarded to it by the Budget Committee. The Board may make additional changes to the budget before adopting via a budget resolution. The budget must be adopted prior to July 1, which is the start of the fiscal year. Oregon Local Budget Law has procedures in place to amend the budget as events occur after the budget is adopted. The type of event determines the procedures which need to be followed.
Most budget changes require a supplemental budget that adjusts the original adopted budget. A supplemental budget can be acted on by the City Council at a regularly scheduled meeting. If, however, the supplemental budget includes any changes greater than ten percent in any fund, a public hearing must be held prior to the adoption of a supplemental budget. The adopted budget appropriates money for contingencies in each fund to be used at the discretion of the governing body. Contingencies can only be expended for specific events by approval of a resolution by the City Council. Contingency expenditures may include funding for service level policy changes, unforeseen events or redirection of resources.
During the fiscal year ended June 30, 2010, two supplemental budgets were adopted. Appropriations lapse as of year‐end.
Annual Financial Statements – For Fiscal Year Ended June 30, 2010 City of Redmond Urban Renewal Agency (A Component Unit of the City of Redmond, Oregon)
NOTES TO THE BASIC FINANCIAL STATEMENTS
32
(2) Cash and Cash Equivalents
The Agency’s investment of cash funds is regulated by Oregon Revised Statutes. Under these guidelines, cash funds may be invested in bank accounts; general obligation issues of the United States, its agencies and certain states; and certain guaranteed investments issued by banks. The Statutes require that all bank deposits in excess of the FDIC or FSLIC insurance amounts be collateralized with securities held by the bank. During the year, the Agency did not purchase any repurchase agreements or reverse repurchase agreements.
The Agency participates in the State Treasurer’s Oregon Short‐Term Fund Local Government Investment Pool during the year. The Oregon Short‐Term Fund is the local government investment pool for local governments and was established by the State Treasurer. It was created to meet the administrative responsibilities of federal arbitrage regulations. The investments are regulated by the Oregon Short‐Term Fund Board and approved by the Oregon Investment Council (ORS 294.805 to 294.895). Local Government Investment Pool (LGIP) is an unrated external investment pool managed by the State Treasurer’s Office, which allows governments within the State to pool their funds for investment purposes. The amounts invested in the pool are not classified by risk categories because they are not evidence by securities that exist in physical or book entry as defined by GASB Statement No. 40.
In addition, the Oregon State Treasurer LGIP distributes investment income on an amortized cost basis and the participant’s equity in the Pool is determined by the amount of participant deposits, adjusted for withdrawals and distributed income. Accordingly, the adjustment to fair value would not represent an expendable increase in the Agency’s cash position.
A. Interest rate risk
The Agency has no formal policy that explicitly limits investment maturities as a means of managing its exposure to fair value loss arising from increasing interest rates.
B. Credit risk
State statutes authorize the Agency to invest in general obligations of the U.S. Government and its agencies, certain bonded obligations of Oregon municipalities, bank repurchase agreements, bankers’ acceptances, and the State Treasurer’s Oregon Local Government Investment Pool (LGIP),
Demand deposits 370,536$ Money market account 2,514,491 Restricted retainage money market account 105,390
2,990,417
Local government investment pool 1,267,290
Total cash and cash equivalents 4,257,707$
Annual Financial Statements – For Fiscal Year Ended June 30, 2010 City of Redmond Urban Renewal Agency (A Component Unit of the City of Redmond, Oregon)
NOTES TO THE BASIC FINANCIAL STATEMENTS
33
among others. The LGIP operates in accordance with appropriate state laws and regulations, but is not regulated by other laws, organizations or regulations. The reported value of the LGIP is substantially the same as the fair value of LGIP shares. Investments are regulated by the Oregon Short‐Term Fund Board and approved by the Oregon Investment Council (ORS 294.805 to 294.895). The LGIP is not registered with the SEC as an investment company.
C. Concentration of credit risk
State law limits investments to obligations of the United States Treasury and United States Government agencies and instrumentalities, certain bankers’ acceptances, repurchase agreements, certain high‐grade commercial paper and corporate bonds and obligations of states and municipalities. The Agency has no investment policy that would further limit its investment choices. The Agency’s investment in the LGIP is not rated. The Pool is not is not registered with the SEC as an investment company, and does not operate in a manner consistent with Rule 2a7 of the Investment Company Act of 1940.
D. Custodial credit risk – deposits
The Governmental Accounting Standards Board has adopted accounting principles generally accepted in the United States of America (GAAP), which includes standards to categorize deposits to give an indication of the level of custodial credit risk assumed by the Agency at June 30, 2010. If bank deposits at year end are not entirely insured or collateralized by the Agency or by its agent in the Agency’s name, the Agency must disclose the custodial credit risk that exists. The Agency’s deposits with financial institutions are comprised of bank demand deposits. For deposits in excess of federal depository insurance, Oregon Revised Statutes require that Public officials report to the Office of the State Treasurer (OST) all bank depositories in which they deposit public funds and bank depositories will then report financial information and total public funds deposits quarterly to OST. OST will then calculate the required collateral that must be pledged by the bank based on this information and the depository’s FDIC assigned capitalization category. Bank depositories will then have a shared liability in the event of a bank loss.
For the fiscal year ended June 30, 2010, the carrying amount of the Agency’s deposits was $2,990,417. This balance was included as part of the City of Redmond’s pooled depository accounts. For the fiscal year ended June 30, 2010, the carrying amount of the City’s deposits was $18,916,368 and the bank balance was $18,991,040. Of the bank balance, $1,112,216 was covered by federal depository insurance. The remaining $17,878,914 was collateralized under ORS 295.
E. Custodial credit risk – investments
For an investment, this is the risk that, in the event of the failure of the counterparty, the Agency will not be able to recover the value of its investments or collateral securities that are in the possession of an outside party. The investment in the LGIP is not deemed to be a security, which is a transferable financial instrument that evidences ownership, and is, therefore, not subject to custodial credit risk.
Annual Financial Statements – For Fiscal Year Ended June 30, 2010 City of Redmond Urban Renewal Agency (A Component Unit of the City of Redmond, Oregon)
NOTES TO THE BASIC FINANCIAL STATEMENTS
34
F. Cash in Escrow and Restricted Balances
During the year ended June 30, 2010, the City opened a separate interest‐bearing bank account to accumulate deposits related to retainage for the benefit of a contractor. The separate retainage account is required under ORS 279C.560. Earnings on the retainage account accrue to the contractor. Therefore, earnings on the retainage account have not been recognized in the financial statements. The balance of the retainage account at June 30, 2010, was $105,390. This balance is reported as restricted cash and cash equivalents in the financial statements at June 30, 2010.
(3) Capital Assets
Changes in the Agency’s capital assets for the year ended June 30, 2010, are as follows:
Depreciation of $51,903 is included in Community development expense.
Beginning EndingBalance Additions Deletions Balance
Capital assets, non‐depreciable:Land 752,566$ ‐$ (301,581)$ 450,985$ Construction in progress 2,377,543 2,793,905 (2,704,754) 2,466,694
Total, non‐depreciable 3,130,109 2,793,905 (3,006,335) 2,917,679
Capital assets, depreciable:Building and building improvements 662,289 398,735 (662,289) 398,735 Land improvements ‐ 780,630 ‐ 780,630 Infrastructure ‐ 1,532,043 ‐ 1,532,043
Total capital assets, depreciable 662,289 2,711,408 (662,289) 2,711,408
Total assets 3,792,398 5,505,313 (3,668,624) 5,629,087
Less accumulated depreciation for:Building (59,606) (17,233) 72,852 (3,987) Land improvements ‐ (19,350) ‐ (19,350) Infrastructure ‐ (15,320) ‐ (15,320)
Total accumulated depreciation (59,606) (51,903) 72,852 (38,657)
Net depreciable capital assets 602,683 2,659,505 (589,437) 2,672,751
Net capital assets 3,732,792$ 5,453,410$ (3,595,772)$ 5,590,430$
Annual Financial Statements – For Fiscal Year Ended June 30, 2010 City of Redmond Urban Renewal Agency (A Component Unit of the City of Redmond, Oregon)
NOTES TO THE BASIC FINANCIAL STATEMENTS
35
(4) Long‐Term Debt
A. Changes in long‐term liabilities
During the year ended June 30, 2010, long‐term liability activity was as follows:
Annual debt service requirements to maturity for bonds payable are as follows:
AmountsBeginning Ending Due WithinBalance Additions Reductions Balance One Year
Governmental activitiesBonds payable ‐ Limited tax issuances 11,835,000$ ‐$ 775,001$ 11,059,999$ 785,001$ Contracts, loans and notes 950,000 ‐ 950,000 ‐ ‐
Total long‐term liabilities 12,785,000$ ‐$ 1,725,001$ 11,059,999$ 785,001$
Principal Interest TotalYear Ending June 30,
2011 785,001$ 517,345$ 1,302,346$ 2012 800,001 480,635 1,280,636 2013 810,001 442,803 1,252,804 2014 820,001 404,411 1,224,412 2015 835,001 364,981 1,199,982
2016‐2020 4,085,005 1,201,882 5,286,887 2021‐2025 2,924,989 384,862 3,309,851
Total 11,059,999$ 3,796,919$ 14,856,918$
Governmental Activities
Annual Financial Statements – For Fiscal Year Ended June 30, 2010 City of Redmond Urban Renewal Agency (A Component Unit of the City of Redmond, Oregon)
NOTES TO THE BASIC FINANCIAL STATEMENTS
36
B. Bonds Payable – Limited Tax Issuances
All of the bonds are secured by a pledge of tax increment revenues. Limited tax issuances are similar to general obligation bonds; however, the Agency’s taxing authority is subject to constitutional limitation.
C. Contracts, Loans and Notes
In June 2008, the Agency obtained an interest‐only revolving line of credit for $1,200,000 with an interest rate of 5%. The line of credit was for financing construction of certain projects and was paid off during the year ended June 30, 2010.
(5) Property Taxes
Real and personal property taxes are levied in July of each fiscal year. Property taxes attach as an enforceable lien on property as of July 1, and are payable in three installments on November 15, February 15, and May 15. All property taxes are billed and collected by Deschutes County and remitted to the Agency. Uncollected taxes, including delinquent amounts, are considered substantially collectible or recoverable through liens, and accordingly no allowance for uncollected taxes has been established.
In September 1999, the Agency issued $4,000,000 of bonds (Series 1999B) at 4.0%‐6.0% tofund certain capital projects including infrastructure improvements for the DowntownUrban Renewal Plan. The bonds mature in June, 2019. Ending balance as of June 30,2010. $ 2,285,000
In June of 2005, the Agency issued $9,794,450 in bonds (Series 2005A) at 4.39% to refundthe line of credit outstanding at that time. The bonds mature in June, 2025. Endingbalance as of June 30, 2010. 7,345,837
In June of 2005, the Agency issued $1,905,550 in bonds (Series 2005B) at 4.39% to finance publicly owned street and sidewalk improvements within the airport and downtownurban renewal areas. The bonds mature in June, 2025. Ending balance as of June 30,2010. 1,429,162
Total Bonds payable as of June 30, 2010. $ 11,059,999
Governmental Activities
Annual Financial Statements – For Fiscal Year Ended June 30, 2010 City of Redmond Urban Renewal Agency (A Component Unit of the City of Redmond, Oregon)
NOTES TO THE BASIC FINANCIAL STATEMENTS
37
Property tax transactions for the year ended June 30, 2010, were as follows:
(6) Risk Management
The Agency is exposed to various risks of loss related to, torts, theft, damage or destruction of assets, errors and omissions, injuries to employees, and natural disasters. The Agency purchases commercial insurance to minimize its exposure to these risks. There has been no reduction in commercial insurance coverage from the last three years. Settled claims have not exceeded this commercial coverage for any of the past three years. (7) Related Party Transactions
The Agency utilizes the City of Redmond for staff support, accounting, information technology, human resources and other services. (8) Commitment and Contingencies
• The construction of Centennial Park in downtown Redmond was substantially complete as of June 30, 2010. Total construction costs incurred as of that date were approximately $2,333,000, with an additional encumbrance on the construction contract of approximately $165,000, including those approved subsequent to that date.
• The Odem Medo Road improvement project was approximately 85% complete as of June 30, 2010 and was completed in Fall, 2010. As of June 30, 2010, total project costs were approximately $1,913,000 with an additional encumbrance on the construction contract of approximately $245,000. Approximately $109,000 of the additional encumbrance will be paid by the South Airport Urban Renewal District.
Tax Year
Beginning Balance and 2009‐10 Levy
Net Adjustments for District Closure Adjustments
Interest (Discounts) Collections
Taxes Receivable June 30, 2010
2009‐10 $ 3,162,926 $ (54,815) $ (12,770) $ (70,447) $ (2,918,970) $ 105,924 2008‐09 182,666 (22,855) (1,472) 5,560 (121,140) 42,759 2007‐08 47,258 (6,934) (274) 2,966 (27,974) 15,042 2006‐07 12,385 (1,427) (204) 1,588 (9,654) 2,688 2005‐06 3,521 (201) (243) 610 (3,109) 578 Prior 1,628 (239) (525) 68 (239) 693
$ 3,410,384 $ (86,471) $ (15,488) $ (59,655) $ (3,081,086) 167,684
Adjustment for June turnover received in July 24,347
Total property taxes receivable at June 30, 2010 192,031$
Annual Financial Statements – For Fiscal Year Ended June 30, 2010 City of Redmond Urban Renewal Agency (A Component Unit of the City of Redmond, Oregon)
NOTES TO THE BASIC FINANCIAL STATEMENTS
38
(9) Special Items
The South Airport Urban Renewal District’s plan was terminated by the City in March, 2010. Upon termination, the remaining capital assets of the South Airport Urban Renewal District were transferred to the City, with the exception of the Odem Medo project which is still under construction and will be transferred to the City upon completion in fiscal year 2011. The asset transfer is reported as a community development program expense in the government‐wide financial statements.
Closure of an urban renewal district involves refunding the fund balance of the urban renewal district to the various taxing districts. As such, an estimate of the remaining fund balance of the South Airport Urban Renewal District of $1,570,000 was refunded to Deschutes County in June, 2010, to be allocated to the taxing districts. This refund to the County is reported as a special item in the government‐wide and governmental fund financial statements. (10) Subsequent Events
On September 7, 2010, the Agency awarded a construction contract for the Eastern Y Gateway Project in the amount of $88,730. The project is expected to be completed in fiscal year 2011.
Supplementary Information Schedules of Revenues, Expenditures and Changes in Fund Balances – Budget to Actual
• Airport Urban Renewal Fund • Downtown Urban Renewal Debt Service Fund • Airport Urban Renewal Development Fund • Downtown Urban Renewal Development Fund
Annual Financial Statements – For Fiscal Year Ended June 30, 2010 City of Redmond Urban Renewal Agency (A Component Unit of the City of Redmond, Oregon)
SUPPLEMENTARY INFORMATION
41
Pursuant to the provisions of Oregon Revised Statue, and individual schedule of revenues, expenditures, and changes in fund balances – budget and actual be displayed for each fund where legally adopted budgets are required.
• Budgetary Comparison Schedules ‐ Airport Urban Renewal Debt Service Fund ‐ Downtown Urban Renewal Debt Service Fund ‐ Airport Urban Renewal Development Fund ‐ Downtown Urban Renewal Development Fund
CITY OF REDMOND URBAN RENEWAL AGENCY
(A Component Unit of the City of Redmond, Oregon)
AIRPORT URBAN RENEWAL DEBT SERVICE FUND
SCHEDULE OF REVENUES, EXPENDITURES, AND
CHANGES IN FUND BALANCE - BUDGET AND ACTUAL
For the Fiscal Year Ended June 30, 2010
Variance
Positive
Original Final Actual (Negative)
REVENUES:
Taxes 962,719$ 898,132$ 940,673$ 42,541$ Interest earnings 5,000 5,000 774 (4,226)
Total revenues 967,719 903,132 941,447 38,315
EXPENDITURES:
Debt service:
Principal 920,000 950,000 949,999 1
Interest 51,154 51,154 48,770 2,384
Total expenditures 971,154 1,001,154 998,769 2,385
Revenues over (under) expenditures (3,435) (98,022) (57,322) 40,700
OTHER FINANCING SOURCES (USES):
Transfers in - 64,587 7,809 (56,778)
Total other financing sources (uses) - 64,587 7,809 (56,778)
Net change in fund balance (3,435) (33,435) (49,513) (16,078)
FUND BALANCE, BEGINNING 3,435 33,435 49,513 16,078
FUND BALANCE, ENDING -$ -$ -$ -$
Budget
See auditor's report.
42
CITY OF REDMOND URBAN RENEWAL AGENCY
(A Component Unit of the City of Redmond, Oregon)
DOWNTOWN URBAN RENEWAL DEBT SERVICE FUND
SCHEDULE OF REVENUES, EXPENDITURES, AND
CHANGES IN FUND BALANCE - BUDGET AND ACTUAL
For the Fiscal Year Ended June 30, 2010
Variance
Positive
Original Final Actual (Negative)
REVENUES:
Taxes 2,023,000$ 2,023,000$ 2,130,043$ 107,043$
Interest earnings 10,000 10,000 11,116 1,116
Total revenues 2,033,000 2,033,000 2,141,159 108,159
EXPENDITURES:Materials and services 1,000 3,000 1,050 1,950 Debt service:
Principal 1,500,967 775,001 775,000 1
Interest 554,033 554,033 554,032 1
Total expenditures 2,056,000 1,332,034 1,330,082 1,952
Revenues over (under) expenditures (23,000) 700,966 811,077 110,111
OTHER FINANCING SOURCES (USES):
Transfers out - (725,966) (725,966) -
Total other financing sources (uses) - (725,966) (725,966) -
Net change in fund balance (23,000) (25,000) 85,111 110,111
FUND BALANCE, BEGINNING 360,000 362,000 413,502 51,502
FUND BALANCE, ENDING 337,000$ 337,000$ 498,613$ 161,613$
Budget
43
See auditor's report.
CITY OF REDMOND URBAN RENEWAL AGENCY
(A Component Unit of the City of Redmond, Oregon)
AIRPORT URBAN RENEWAL DEVELOPMENT FUND
SCHEDULE OF REVENUES, EXPENDITURES, AND
CHANGES IN FUND BALANCE - BUDGET AND ACTUAL
For the Fiscal Year Ended June 30, 2010
Variance
Positive
Original Final Actual (Negative)
REVENUES:
Rentals and leases 40,000$ 33,812$ 32,007$ (1,805)$
Interest earnings 40,000 16,257 18,897 2,640
Total revenues 80,000 50,069 50,904 835
EXPENDITURES:
Materials and services 73,800 55,209 45,272 9,937
Capital outlay 2,178,015 460,000 350,751 109,249
Total expenditures 2,251,815 515,209 396,023 119,186
Revenues over (under) expenditures (2,171,815) (465,140) (345,119) 120,021
OTHER FINANCING SOURCES (USES):
Budget
OTHER FINANCING SOURCES (USES):
Transfers out - (230,671) (172,088) 58,583
Total other financing sources (uses) - (230,671) (172,088) 58,583
SPECIAL ITEMS:
Refund to County upon closure of
South Airport Urban Renewal District - (1,570,000) (1,570,000) -
Total special items - (1,570,000) (1,570,000) -
Net change in fund balance (2,171,815) (2,265,811) (2,087,207) 178,604
FUND BALANCE, BEGINNING 2,171,815 2,265,811 2,265,810 (1)
FUND BALANCE, ENDING -$ -$ 178,603$ 178,603$
44
See auditor's report.
CITY OF REDMOND URBAN RENEWAL AGENCY
(A Component Unit of the City of Redmond, Oregon)
DOWNTOWN URBAN RENEWAL DEVELOPMENT FUND
SCHEDULE OF REVENUES, EXPENDITURES, AND
CHANGES IN FUND BALANCE - BUDGET AND ACTUAL
For the Fiscal Year Ended June 30, 2010
Variance
Positive
Original Final Actual (Negative)
REVENUES:
Interest earnings 100,000$ 100,000$ 38,922$ (61,078)$
Miscellaneous - - 12,516 12,516
Total revenues 100,000 100,000 51,438 (48,562)
EXPENDITURES:
Materials and services 511,300 866,300 583,452 282,848
Capital outlay 5,556,129 5,367,213 2,419,359 2,947,854
Total expenditures 6,067,429 6,233,513 3,002,811 3,230,702
Revenues over (under) expenditures (5,967,429) (6,133,513) (2,951,373) 3,182,140
OTHER FINANCING SOURCES (USES):
Issuance of debt 725,966 725,966 - (725,966)
Transfers in - 166,084 890,245 724,161
Transfers out (97,845) (97,845) - 97,845
Total other financing sources (uses) 628,121 794,205 890,245 96,040
Net change in fund balance (5,339,308) (5,339,308) (2,061,128) 3,278,180
FUND BALANCE, BEGINNING 5,339,308 5,339,308 5,216,122 (123,186)
FUND BALANCE, ENDING -$ -$ 3,154,994$ 3,154,994$
Budget
45
See auditor's report.
49
INDEPENDENT AUDITOR’S COMMENTS
Oregon Administrative Rules 162-10-000 through 162-10-330 of the Minimum Standards for Audits of Oregon Municipal Corporations, prescribed by the Secretary of State in cooperation with the Oregon State Board of Accountancy, enumerate the financial statements, schedules, comments, and disclosures required in audit reports. The required schedules, comments, and disclosures not included in the preceding section of this report are set forth following: Accounting Systems and Internal Controls We found that the accounting records of the Agency were generally well maintained and adequate for audit purposes. The internal controls for the Agency are operating as designed, however, there were deficiencies reported in accordance with SAS 115, which we have reported to management in a separate letter. Investments Our review of deposit and investment balances indicated that the Agency was in compliance with ORS 294, as it pertains to investment of public funds, during the year ended June 30, 2010. Collateral Oregon Revised Statutes (ORS) Chapter 295 provides that public officials must ensure the banks they are doing business with are on the Office of the State Treasurer’s (OST) list of qualified depositories. Public officials are also required to report to OST all bank depositories in which they deposit public funds. The Agency commingles its cash balances with the City of Redmond, Oregon (City) accounts. Our review of the City’s deposited funds did not disclose any instances where the City deposited funds with unapproved depositories or did not properly notify the OST of what depositories held their public funds, as required by ORS 295. Indebtedness We reviewed compliance relating to short-term and long-term debt, including limitations on the amount of debt, which may be incurred, liquidation of debt within the prescribed period, and compliance with provisions of bond indentures or other agreements. We found no instances in which the Agency had not complied with these legal or contractual provisions relating to short-term and long-term debt. Budget We reviewed the execution of the Agency’s budget for 2009-10 and the preparation and adoption of the budget for 2010-11. The Agency has complied with statutory requirements in all material respects for the current and ensuing year’s budget, except as follows:
50
The Agency budgeted transfers out in 2009-10 fiscal year budget, which actually represent payments to outside parties. In addition, a supplemental budget was prepared during the year reclassifying the payment of short term debt to a transfer out, but the transfer into the receiving fund was not reclassified. As a result, the budgeted amount for interfund transfers does not balance. The resolution authorizing appropriations for each fund sets the level at which expenditures cannot legally exceed appropriations. The Agency established the levels of budgetary control at the materials and services, capital outlay, operating contingencies, and debt service levels. Insurance And Fidelity Bonds The Agency is covered by insurance and fidelity bonds under the City’s policies. We reviewed the City's insurance and fidelity bond coverage at June 30, 2010, and ascertained that such policies appeared to be in force. We are not competent by training to comment whether the insurance policies of the City in force at June 30, 2010, are adequate. The City has complied with provisions of ORS 221.903 regarding bonding of City personnel. Programs Funded From Outside Sources We selected and tested, to the extent deemed appropriate, transactions, records, and reports relative to programs funded wholly or partially by other governmental agencies. The results of our tests indicate, for the items tested, the Agency complied with laws, rules and regulations pertaining to programs funded wholly or partially by other governmental agencies, and, for the items tested, financial reports and related data were materially in agreement with and supported by accounting records. Highway Funds The Agency does not receive Highway Funds. Public Contracts And Purchasing We have reviewed the Agency’s compliance with ORS 279, pertaining to the awarding of public contracts and the construction of public improvements. Our review disclosed no conditions, which we considered to be matters of noncompliance of the Agency’s bidding procedures or quote procedures. Statement of Accountability for Independently Elected Officials
This statement is not applicable to the City of Redmond Urban Renewal Agency.