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HomeMy WebLinkAboutAnnual Report July 01, 2011 - June 30, 2012 Federal Compliance Audit City of South Burlington, Vermont June 30, 2012 Proven Expertise and Integrity CITY OF SOUTH BURLINGTON, VERMONT CONTENTS JUNE 30, 2012 PAGE INDEPENDENT AUDITORS' REPORT 1 - 2 MANAGEMENT’S DISCUSSION AND ANALYSIS 3 - 12 BASIC FINANCIAL STATEMENTS GOVERNMENT WIDE FINANCIAL STATEMENTS STATEMENT A - STATEMENT OF NET ASSETS 13 STATEMENT B - STATEMENT OF ACTIVITIES 14 - 15 FUND FINANCIAL STATEMENTS STATEMENT C - BALANCE SHEET – GOVERNMENTAL FUNDS 16 STATEMENT D - RECONCILIATION OF THE GOVERNMENTAL FUNDS BALANCE SHEET TO THE STATEMENT OF NET ASSETS 17 STATEMENT E - STATEMENT OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCES – GOVERNMENTAL FUNDS 18 STATEMENT F - RECONCILIATION OF THE STATEMENT OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCES OF GOVERNMENTAL FUNDS TO THE STATEMENT OF ACTIVITIES 19 STATEMENT G - BALANCE SHEET – PROPRIETARY FUNDS 20 - 21 STATEMENT H - STATEMENT OF REVENUES, EXPENSES AND CHANGES IN NET ASSETS – PROPRIETARY FUNDS 22 - 23 STATEMENT I - STATEMENT OF CASH FLOWS – PROPRIETARY FUNDS 24 - 25 STATEMENT J - STATEMENT OF NET ASSETS – FIDUCIARY FUNDS 26 NOTES TO FINANCIAL STATEMENTS 27 - 52 REQUIRED SUPPLEMENTARY INFORMATION REQUIRED SUPPLEMENTARY INFORMATION DESCRIPTION 53 SCHEDULE 1 - BUDGETARY COMPARISON SCHEDULE – BUDGETARY BASIS – BUDGET AND ACTUAL – GENERAL FUND 54 SCHEDULE 2 - BUDGETARY COMPARISON SCHEDULE – BUDGETARY BASIS – BUDGET AND ACTUAL – GENERAL FUND REVENUES 55 OTHER SUPPLEMENTARY INFORMATION OTHER SUPPLEMENTARY INFORMATION DESCRIPTION 56 SCHEDULE A - SCHEDULE OF DEPARTMENTAL OPERATIONS 57 - 59 SCHEDULE B - COMBINING BALANCE SHEET – NONMAJOR GOVERNMENTAL FUNDS 60 SCHEDULE C - COMBINING SCHEDULE OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCES – NONMAJOR GOVERNMENTAL FUNDS 61 SPECIAL REVENUE FUNDS DESCRIPTION 62 SCHEDULE D - COMBINING BALANCE SHEET – NONMAJOR SPECIAL REVENUE FUNDS 63 - 74 SCHEDULE E - COMBINING SCHEDULE OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCES – NONMAJOR SPECIAL REVENUE FUNDS 75 - 86 CAPITAL PROJECTS DESCRIPTION 87 SCHEDULE F - COMBINING BALANCE SHEET – NONMAJOR CAPITAL PROJECT FUNDS 88 - 92 SCHEDULE G - COMBINING SCHEDULE OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCES – NONMAJOR CAPITAL PROJECT FUNDS 93 - 97 PERMANENT FUNDS DESCRIPTION 98 SCHEDULE H - COMBINING BALANCE SHEET – NONMAJOR PERMANENT FUNDS 99 - 101 SCHEDULE I - COMBINING SCHEDULE OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCES – NONMAJOR PERMANENT FUNDS 102 – 104 GENERAL CAPITAL ASSETS DESCRIPTION 105 SCHEDULE J - SCHEDULE OF GENERAL CAPITAL ASSETS BY FUNCTION 106 SCHEDULE K - SCHEDULE OF CHANGES IN GENERAL CAPITAL ASSETS BY FUNCTION 107 FEDERAL COMPLIANCE SCHEDULE OF EXPENDITURES OF FEDERAL AWARDS 108 NOTES TO SCHEDULE OF EXPENDITURES OF FEDERAL AWARDS 109 INDEPENDENT AUDITORS' REPORT ON INTERNAL CONTROL OVER FINANCIAL REPORTING AND ON COMPLIANCE AND OTHER MATTERS BASED ON AN AUDIT OF FINANCIAL STATEMENTS PERFORMED IN ACCORDANCE WITH GOVERNMENT AUDITING STANDARDS 110 - 111 INDEPENDENT AUDITORS’ REPORT ON COMPLIANCE WITH REQUIREMENTS THAT COULD HAVE A DIRECT AND MATERIAL EFFECT ON EACH MAJOR PROGRAM AND ON INTERNAL CONTROL OVER COMPLIANCE IN ACCORDANCE WITH OMB CIRCULAR A-133 112 - 113 SCHEDULE OF FINDINGS AND QUESTIONED COSTS 114 1 INDEPENDENT AUDITORS’ REPORT November 16, 2012 City Council City of South Burlington South Burlington, Vermont We have audited the accompanying financial statements of the governmental activities, the business-type activities, each major fund, and the aggregate remaining fund information of the City of South Burlington, Vermont, as of and for the year ended June 30, 2012, which collectively comprise the City’s basic financial statements as listed in the table of contents. These financial statements are the responsibility of the City’s management. Our responsibility is to express an opinion on these financial statements based on our audit. We conducted our audit in accordance with auditing standards generally accepted in the United States of America and the standards applicable to financial audits contained in Government Auditing Standards, issued by the Comptroller General of the United States. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the basic financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the basic financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall basic financial statement presentation. We believe that our audit provides a reasonable basis for our opinion. In our opinion, the financial statements referred to above present fairly, in all material respects, the respective financial position of the governmental activities, the business-type activities, each major fund, and the aggregate remaining information of the City of South Burlington, Vermont as of June 30, 2012, and the respective changes in financial position and cash flows, where applicable, thereof for the year then ended, in conformity with accounting principles generally accepted in the United States of America. Proven Expertise and Integrity 3 Old Orchard Road, Buxton, Maine 04093 Tel: (800) 300-7708 (207) 929-4606 Fax: (207) 929-4609 www.rhrsmith.com 2 In accordance with Government Auditing Standards, we have also issued our report dated November 16, 2012 on our consideration of the City of South Burlington, Vermont’s internal control over financial reporting and our tests of its compliance with certain provisions of laws, regulations, contracts and grants agreements and other matters. The purpose of that report is to describe the scope of our testing of internal control over financial reporting and compliance and the results of that testing, and not to provide an opinion on internal control over financial reporting or on compliance. That report is an integral part of an audit performed in accordance with Government Auditing Standards and should be read in conjunction with this report in considering the results of our audit. Accounting principles generally accepted in the United States of America require that the management’s discussion and analysis and budgetary comparison information on pages 3 through 12 and 54 be presented to supplement the basic financial statements. Such information, although not a part of the basic financial statements, is required by the Governmental Accounting Standards Board, who considers it to be an essential part of financial reporting for placing the basic financial statements in an appropriate operational, economic, or historical context. We have applied certain limited procedures to the required supplementary information in accordance with auditing standards generally accepted in the United States of America, which consisted of inquiries of management about the methods of preparing the information and comparing the information for consistency with management’s responses to our inquiries, the basic financial statements, and other knowledge we obtained during our audit of the basic financial statements. We do not express an opinion or provide any assurance on the information because the limited procedures do not provide us with sufficient evidence to express an opinion or provide any assurance. Our audit was conducted for the purpose of forming opinions on the financial statements that collectively comprise the City of South Burlington, Vermont’s financial statements as a whole. The combining and individual non-major fund financial statements are presented for purposes of additional analysis and are not a required part of the financial statements. The accompanying schedule of expenditures of federal awards is presented for the purposes of additional analysis as required by the U.S. Office of Management and Budget Circular A-133, Audits of States, Local Governments, and Non- Profit Organizations, and is also not a required part of the financial statements. The combining and individual nonmajor fund financial statements and the schedule of expenditures of federal awards are the responsibility of management and are derived from and relate directly to the underlying accounting and other records used to prepare the financial statements. The information has been subjected to the auditing procedures applied in the audit of the financial statements and certain additional procedures, including comparing and reconciling such information directly to the underlying accounting and other records used to prepare the financial statements or to the financial statements themselves, and other additional procedures in accordance with auditing standards generally accepted in the United States of America. In our opinion, the information is fairly stated in all material respects in relation to the financial statements as a whole. Certified Public Accountants 3 REQUIRED SUPPLEMENTARY INFORMATION MANAGEMENT'S DISCUSSION AND ANALYSIS JUNE 30, 2012 (UNAUDITED) The following management’s discussion and analysis of the City of South Burlington, Vermont's financial performance provides an overview of the City's financial activities for the fiscal year ended June 30, 2012. Please read it in conjunction with the City's financial statements. Financial Statement Overview The City of South Burlington’s basic financial statements include the following components: 1) government-wide financial statements, 2) fund financial statements, and 3) notes to the financial statements. This report also includes required supplementary information which consists of the general fund budgetary comparison schedule, and other supplementary information which includes combining and other schedules. Basic Financial Statements The basic financial statements include financial information in two differing views: the government-wide financial statements and the fund financial statements. These basic financial statements also include the notes to financial statements that explain in more detail certain information in the financial statements and also provide the user with the accounting policies used in the preparation of the financial statements. Government - Wide Financial Statements The government-wide financial statements provide a broad view of the City’s operations in a manner that is similar to private businesses. These statements provide both short–term as well as long–term information in regards to the City’s financial position. These financial statements are prepared using the accrual basis of accounting. This measurement focus takes into account all revenues and expenses associated with the fiscal year regardless of when cash is received or paid. The government–wide financial statements include the following two statements: The Statement of Net Assets – this statement presents all of the government’s assets and liabilities with the difference being reported as net assets. The Statement of Activities – this statement presents information that shows how the government’s net assets changed during the period. All changes in net assets are reported as soon as the underlying event giving rise to the change occurs, regardless of the timing of the related cash flows. 4 Both of the above mentioned financial statements have separate columns for the two different types of City activities. The types of activities presented for the City of South Burlington are: ● Governmental activities – The activities in this section are mostly supported by taxes and intergovernmental revenues (federal and state grants). Most of the City's basic services are reported in governmental activities, which include general government, public safety, public works, education, social services, recreation and culture and other unclassified. ● Business-type activities – These activities are normally intended to recover all or a significant portion of their costs through user fees and/or charges to external users for goods and / or services. These activities for the City of South Burlington include the recreation program, water department, water pollution, ambulance services and storm water utilities. Fund Financial Statements A fund is a grouping of related accounts that is used to maintain control over resources that have been segregated for specific activities or objectives. The City of South Burlington, like other local governments uses fund accounting to ensure and demonstrate compliance with financial related legal requirements. All of the funds of the City of South Burlington can be divided into three categories: governmental funds, proprietary funds, and fiduciary funds. Governmental funds: Most of the basic services provided by the City are financed through governmental funds. Governmental funds are used to account for essentially the same functions reported in governmental activities in the government–wide financial statements. However, unlike the government-wide financial statements, the governmental fund financial statements focus on near-term inflows and outflows of spendable resources. They also focus on the balance of spendable resources available at the end of the fiscal year. Such information will be useful in evaluating the government’s near-term financing requirements. This approach is known as the current financial resources measurement focus and the modified accrual basis of accounting. Under this approach revenues are recorded when cash is received or when susceptible to accrual. Expenditures are recorded when liabilities are incurred and due. These statements provide a detailed short- term view of the City’s finances to assist in determining whether there will be adequate financial resources available to meet the current needs of the City. Because the focus of governmental funds is narrower than that of government-wide financial statements, it is useful to compare the information presented for governmental funds with similar information presented for governmental activities in the government-wide financial statements. By doing so, readers may better understand the long-term impact of the government’s near-term financing decisions. Both the governmental fund balance sheet and the governmental fund statement of revenues, expenditures and changes in fund balances provide a reconciliation to facilitate this comparison between governmental funds and governmental activities. These reconciliations are presented on the page immediately following each governmental fund financial statement. 5 The City of South Burlington presents three columns in the governmental fund balance sheet and the governmental fund statement of revenues, expenditures and changes in fund balances. The City’s major governmental funds are the general fund and airport parkway expansion. All other funds are shown as nonmajor and are combined in the “Other Governmental Funds” column on these statements. The general fund is the only fund for which the City legally adopted a budget. The Budgetary Comparison Schedule – Budgetary Basis – Budget and Actual – General Fund provides a comparison of the original and final budget and the actual expenditures for the current year. Proprietary Funds: The City of South Burlington maintains five proprietary funds: the recreation programs, water department, water pollution, ambulance services and storm water utilities. These funds are used to show activities that operate more like those of commercial enterprises. Proprietary funds provide the same type of information as the government-wide financial statements, only in more detail. Like the government-wide financial statements, proprietary fund financial statements use the accrual basis of accounting. No reconciliation is needed between the government-wide financial statements for business-type activities and the proprietary fund financial statements. Fiduciary Funds: These funds are used to account for resources held for the benefit of parties outside the City of South Burlington. These funds are not reflected in the government-wide financial statements because the resources of these funds are not available to support the City’s own programs. The accounting used for fiduciary funds are much like that of proprietary funds. They use the accrual basis of accounting. These funds for the City are for the pension Notes to the Financial Statements The notes provide additional information that is essential to a full understanding of the data provided in the Government-Wide and the Fund Financial Statements. The Notes to Financial Statements can be found following the Fiduciary Fund Financial Statements. Required Supplementary Information The basic financial statements are followed by a section of required supplementary information, which includes a Budgetary Comparison Schedule – Budgetary Basis – Budget and Actual – General Fund. Other Supplementary Information Other supplementary information follows the required supplementary information. These combining and other schedules provide information in regards to nonmajor funds, capital asset activity and other detailed budgetary information for the general fund. 6 Government-Wide Financial Analysis Our analysis below focuses on the net assets, and changes in net assets of the City's governmental activities. The City's total net assets for governmental funds is $19.64 million compared to $17.78 million in the prior year, an increase of 10.44%. For the business-type activities total net assets are $8.65 million as compared to $7.88 million in the prior year, an increase of 9.74 %. Unrestricted net assets - the part of net assets that can be used to finance day-to- day operations without constraints established by debt covenants, enabling legislation, or other legal requirements – is $5.88 million at the end of this year for governmental activities and $3.89 million for the business-type activities. G overnm ental B usiness-typ e G overnm ental B usiness-type A ctivities A ctivities A ctivities A ctivities Assets: C urrent and O ther A ssets 8,996,709$ 3,422,814$ 8,522,491$ 2,259,829$ C apital A ssets 51,773,741 9,430,604 52,950,257 10,079,918 Total A ssets 60,770,450$ 12,853,418$ 61,472,748$ 12,339,747$ Liab ilities: C urrent Liabilities 2,886,279$ 1,183,278$ 3,648,229$ 1,072,405$ Long-term D ebt O utstanding 38,244,783 3,024,008 40,041,948 3,388,144 Total Liabilities 41,131,062$ 4,207,286$ 43,690,177$ 4,460,549$ N et A ssets: Invested in C apital A ssets, N et of R elated D ebt 12,685,664$ 6,042,460$ 12,112,301$ 6,330,363$ R estricted for: S pecial revenues 358,477 - 977,574 - P erm anent funds 467,933 - 407,851 - C apital projects 249,153 - 394,471 - S torm w ater - - - 5,000 U nrestricted N et A ssets 5,878,161 2,603,672 3,890,374 1,543,835 Total N et A ssets 19,639,388$ 8,646,132$ 17,782,571$ 7,879,198$ 2011 Table 1 C ity of S outh B urlington, V erm ont N et A ssets June 30, 2012 7 G o vern m ental B usin ess-typ e G o vern m en tal B u sin ess-typ e Activities Activities A ctivities Activities R even ues G eneral tax revenue (C ity)14,281,144$ -$ 13,301,819$ -$ Intergovernmental revenue 1,202,062 - 2,512,422 89,640 C harges for services 4,799,291 7,142,227 1,577,690 6,709,727 Investm ent incom e 115,338 - 161,859 4,946 B ond proceeds 2,200,000 - 24,876 - P ension - net earnings - - - - O ther revenue 302,894 407,138 498,511 197,664 T otal R evenues 22,900,729 7,549,365 18,077,177 7,001,977 E xp en ses G eneral governm ent 3,342,863 - 2,947,013 - P ublic safety 8,643,255 - 7,915,580 - P ublic w orks 3,055,306 - 2,661,337 - S ocial services 566,321 - 597,084 - R ecreation and culture 1,178,834 - 994,460 - P rogram expenditures 16,102 - 7,283 - C apital outlay 3,527,264 - 449,829 - Interest expense 785,201 - 1,180,029 - E ducation 90,232 - 125,000 - E nterprise fund - 6,620,965 - 6,838,510 T otal E xpenses 21,205,378 6,620,965 16,877,615 6,838,510 T otal transfers 161,466 (161,466) 207,878 (207,878) C hange in N et A ssets 1,856,817 766,934 1,407,440 (44,411) N et Assets - July 1 17,782,571 7,879,198 16,375,131 7,923,609 N et Assets - June 30 19,639,388$ 8,646,132$ 17,782,571$ 7,879,198$ 2012 2011 T ab le 2 C ity o f S o uth B u rling to n, V erm o nt C han g e in N et A ssets F o r th e Y ears E n d ed Jun e 30, 8 Revenues and Expenses Revenues for the City's governmental activities increased by 26.68%, while total expenses increased by 25.64%. Most of the City’s expenses had increased from the prior year. The expenses and revenues for the proprietary fund were consistent with the prior year. The proprietary fund has five enterprise funds with all of them having positive net assets with the exception of ambulance services. The proprietary funds had net income for the current year of $766,934. The increase was mainly caused by transfers of funds from the general fund. Financial Analysis of the City’s Fund Statements Governmental funds: The financial reporting focus of the City’s governmental funds is to provide information on near-term inflows, outflows, and balances of spendable resources. Such information may be useful in assessing the City’s financial requirements. In particular, unassigned fund balance may serve as a useful measure of a government’s financial position at the end of the year, and the net resources available for spending. 9 2012 2011 M ajor Funds: G eneral fund: N onspendable 244,188$ 412,638$ U nassigned 1,743,982 1,226,972 A irport parkw ay expansion: U nassigned 2,231,099 (4,163,267) S ubtotal M ajor Funds 4,219,269 (2,523,657) N on-M ajor Funds: S pecial revenue funds: R estricted 358,477 977,574 C om m itted 1,468,032 4,599,381 A ssigned 95,080 81,464 U nassigned (10,016) (428,986) C apital projects fund: R estricted 249,153 394,471 C om m itted 1,137,924 1,184,615 U nassigned (144,096) (1,228,082) P erm anent funds: R estricted 467,933 407,851 C om m itted 6,092 3,557 U nassigned (811) (1,486) S ubtotal N on-M ajor Funds 3,627,768 5,990,359 Total G overnm ental Funds 7,847,037$ 3,466,702$ T able 3 C ity of S outh B urlington, V erm ont Fund B alances - G overnm ental Fund s June 30, The general fund total fund balance increased by $348,560 from the prior fiscal year. Other major funds fund balance increased by $6,394,366 and the non-major fund balances decreased by $2,362,591 from the prior fiscal year. The increase in the airport parkway expansion fund is due to bond proceeds and a transfer from the general fund. The decrease in the non-major funds is due to transfers to the general fund to write-off inactive funds. Proprietary funds: The City’s proprietary funds provide the same type of information found in the government-wide financial statements, but in more detail. 10 Budgetary Highlights There were no significant differences between the original and final budget for the general fund. The general fund actual revenues exceeded the budgeted amount by $6,011,753. This was mainly a result of charges for services and tax revenues and transferring certain balances from other funds to the general fund. The general fund actual expenditures exceeded budget by $5,413,193. All expenditures were under budget with the exception of general government, public works and debt service. Several transfers were made to close out funds with deficit balances. Capital Asset and Debt Administration Capital Assets As of June 30, 2012, the net book value of capital assets recorded by the City decreased by $1,825,830 from the prior fiscal year. This decrease was a result of current year depreciation less capital additions. 20 12 2011 Land an d imp rovemen ts 7,837 ,632$ 8,049,192$ Buildings and improvements 10,293 ,482 1 0,795,851 M achinery and equipment 5,512 ,977 5,787,536 Vehicles 1,654 ,356 2,021,784 Infrastructure 7,334 ,647 7,804,561 C onstruction in progress 28,571 ,251 2 8,571,251 Total 61,204 ,345$ 6 3,030,175$ T able 4 C ity of So uth B urlington, Verm ont C apital A ssets (Ne t of D eprecia tion) June 30, Debt At June 30, 2012, the City had $33.265 million in bonds outstanding versus $34.365 million last year, a decrease of 3.20%, as shown in Note 5 of Notes to Financial Statements. Other liabilities include notes payable and accrued vacation and sick time. 11 Economic Factors and Future Year's Budgets and Rates As required by the City Charter, I am presenting the City Manager’s proposed budget for FY 2013 for City Council consideration. This proposed budget does much to restore service and staff cuts instituted in FY 2011 and FY 2012. The FY 2012 General Fund ran an excess and we project the FY 2013 budget will be balanced or in surplus. Many changes in how our budgets are constructed and monitored – including sound revenue and expenditure projections and greater accountability – have accounted for this turnaround from previous years. We also expect all the Enterprise Funds to be balanced or run a surplus in FY 2013. Considering all the services residents and taxpayers receive from the City of South Burlington (roads, plowing, recreation, library, police, fire, ambulance, vital records, planning and water, wastewater and stormwater utilities), the City is providing a relative bargain. Many households have higher cable and internet or wireless phone bills than the cost of municipal services they are asked to contribute to. The FY 2013 General Fund budget expenditures are proposed at $18,970,660, an increase of $1,300,108, or 7.36%. General Fund non-property tax revenues are estimated to increase by $840,895, a 12.15% increase over the current year. The property tax rate needed is estimated to be $0.4036, an increase of $0.0210 (2.10 cents), or 5.49%. Special Funds (200, 300 and 600) continue to be consolidated into the General Fund. The FY 2013 Special Funds budget expenditure is proposed at $790,284, a decrease of $169,594 from the FY 2012 figure of $959,878. The Water Fund budget for FY 2013 is proposed at $2,370,308, an increase of $32,873, or 1.4% over the FY 2012 budget. Water user fees are proposed to increase 2.8%. The Water Pollution Control Fund budget for FY 2013 is proposed at $2,668,971. This is a decrease of $38,439 or 1.42% from the current year’s budget. A rate increase of 1.5% is proposed. The Stormwater Fund budget is proposed at $3,621,856, an increase of $1,884,238 which is offset by $1,786,114 in additional revenues related to capital expenditures. No rate increase is proposed for FY 2013. The total of all funds for FY 2013 is $ 28,422,079, compared to $25,412,893 for FY 2012, an increase of $3,009,186. A large portion of this increase, $1,670,650, is due to Stormwater capital projects expenditures and will be offset by revenues in the Stormwater Fund. 12 A spreadsheet, entitled, “FY13 - Summary, All Funds, Expenses and Revenues” provides a quick overview and is attached to this Executive Summary. Copies of the FY 2013 proposed budget, including this Executive Summary and the full Budget Message are available for inspection at the following locations: the South Burlington Community Library, the City Manager’s Office, the City Clerk’s Office and on the City’s website at www.sburl.com . Acknowledgements: I extend my thanks to all our City employees for their continued dedication and hard work. I also extend the administration’s appreciation to the many volunteers who serve on the City’s boards, committees, commissions and who aid us in many other ways year round. Special thanks to all division and department heads who participated in the development of the budget and have continually found ways to avoid waste and produce innovative solutions. I want to single out the contribution of Justin Rabidoux in assisting in the development of the Enterprise Fund budgets. Kudos to Deputy Finance Officer, Sue Dorey, who participated in all budget meetings and provided assistance in many facets of this process and to Janice Ladd, Human Resources Coordinator, who helped with compensation and benefits calculations. Last, but not least, I acknowledge the extremely capable work performed by Deputy City Manager Bob Rusten. Bob, working with department and division heads and other staff, has developed a budget process which will serve South Burlington well for many years to come. It is based on accuracy, trends and collaboration among team members, all of which are essential to achieve the level of transparency we are striving for. Responsibility for reviewing, revising and finalizing the budget to go to voters now shifts to City Council whose assistance during the past year is also greatly appreciated. Councilors, with assistance from City Staff, will hold a number of meetings over the next several weeks in accordance with the attached schedule. Contacting the City's Financial Management This financial report is designed to provide our citizens, taxpayers, customers, and investors and creditors with a general overview of the City's finances and to show the City's accountability for the money it receives. If you have questions about this report or need additional financial information, contact Bob Rusten, Assistant City Manager at 575 Dorset Street, South Burlington, Vermont 05403-0808. Bob can also be reached by phone at 802-846-4107 or by email brusten@sburl.com. STATEMENT A CITY OF SOUTH BURLINGTON, VERMONT STATEMENT OF NET ASSETS JUNE 30, 2012 13 G overnm ental Business-Type Activities Activities Total ASSETS C urrent assets: C ash and cash equivalents 7,198,672$ 1,241,294$ 8,439,966$ Investm ents 368,393 - 368,393 Taxes receivable (net of allow ance for uncollectibles)197,003 - 197,003 D ue from other governm ents 485,025 - 485,025 D ue from w ater - billed - 493,276 493,276 D ue from w ater - unbilled - 1,156,469 1,156,469 O ther 368,953 601,524 970,477 D ue from agencies 75 - 75 Prepaid expenses 244,188 515 244,703 Inventory - 64,136 64,136 Internal balances 134,400 (134,400) - Total current assets 8,996,709 3,422,814 12,419,523 N oncurrent assets: C apital assets: Land, 34,601,514 518,000 35,119,514 Buildings 17,172,227 8,912,604 26,084,831 Total noncurrent assets 51,773,741 9,430,604 61,204,345 TO TAL ASSETS 60,770,450$ 12,853,418$ 73,623,868$ LIABILITIES C urrent liabilities: Accounts payable 811,644$ 192,114$ 1,003,758$ Accrued expenses 216,778 - 216,778 D ue to taxpayers 35,795 - 35,795 D ue to agencies 6,188 - 6,188 D ue to other governm ents 14,043 627,028 641,071 O ther liabilities 12,936 - 12,936 Post retirem ent benefits 246,696 - 246,696 C urrent portion of long-term obligations 1,542,199 364,136 1,906,335 Total current liabilities 2,886,279 1,183,278 4,069,557 N oncurrent liabilities: N oncurrent portion of long-term obligations: Bonds payable 29,140,992 3,024,008 32,165,000 N otes payable 8,404,886 - 8,404,886 Accrued com pensated absences 698,905 - 698,905 Total noncurrent liabilities 38,244,783 3,024,008 41,268,791 TO TAL LIABILITIES 41,131,062 4,207,286 45,338,348 N ET ASSETS Invested in capital assets, net of related debt 12,685,664 6,042,460 18,728,124 R estricted for: Special revenues 358,477 - 358,477 Perm anent funds 467,933 - 467,933 C apital projects 249,153 - 249,153 U nrestricted 5,878,161 2,603,672 8,481,833 TO TAL N ET A SSETS 19,639,388 8,646,132 28,285,520 TO TAL LIABILITIES AN D NE T ASSETS 60,770,450$ 12,853,418$ 73,623,868$ See accom panying independent auditors' report and notes to financial statem ents. STATEMENT B CITY OF SOUTH BURLINGTON, VERMONT STATEMENT OF ACTIVITIES FOR THE YEAR ENDED JUNE 30, 2012 14 O perating C apital Business- C harges for G rants &G rants &G overnm ental type Functions/Program s Expenses Services C ontributions C ontributions A ctivities Activities Total G overnm ental activities: G eneral governm ent 3,342,863$ 1,428,426$ -$ -$ (1,914,437)$ -$ (1,914,437)$ Public safety 8,643,255 803,615 - - (7,839,640) - (7,839,640) Public w orks 3,055,306 961,912 - - (2,093,394) - (2,093,394) Social services 566,321 107,185 - - (459,136) - (459,136) R ecreation and culture 1,178,834 187,728 - - (991,106) - (991,106) Education 31,387,976 - - - (31,387,976) - (31,387,976) Program expenditures 16,102 1,310,425 - - 1,294,323 - 1,294,323 C apital outlay 3,527,264 - - - (3,527,264) - (3,527,264) Interest expense 785,201 - - - (785,201) - (785,201) Total governm ental activities 52,503,122 4,799,291 - - (47,703,831) - (47,703,831) Business-type activities: R ecreation program s 160,957 191,425 - - - 30,468 30,468 W ater departm ent 2,107,305 2,052,901 - - - (54,404) (54,404) W ater pollution 3,059,709 3,172,341 - - - 112,632 112,632 Am bulance services - - - - - - - Storm w ater utilities 1,292,994 1,725,560 - - - 432,566 432,566 Total business-type activities 6,620,965 7,142,227 - - - 521,262 521,262 Total governm ent 59,124,087$ 11,941,518$ -$ -$ (47,703,831) 521,262 (47,182,569) Program R evenues N et (Expense) R evenue & C hanges in N et Assets STATEMENT B (CONTINUED) CITY OF SOUTH BURLINGTON, VERMONT STATEMENT OF ACTIVITIES (CONTINUED) FOR THE YEAR ENDED JUNE 30, 2012 15 B usiness- G overnm ental type A ctivities A ctivities T otal C hanges in net assets: N et (expense) revenue (47,703,831) 521,262 (47,182,569) G eneral revenues: P roperty taxes, levied for general purposes E ducation 31,297,744 - 31,297,744 M unicipal 14,281,144 - 14,281,144 G rants and contributions not restricted to specific program s 1,202,062 - 1,202,062 Investm ent incom e 115,338 - 115,338 C apital projects funding 2,200,000 - 2,200,000 M iscellaneous 302,894 407,138 710,032 T ransfers 161,466 (161,466) - T otal revenues and transfers 49,560,648 245,672 18,508,576 C hange in net assets 1,856,817 766,934 2,623,751 N E T A S S E T S - JU LY 1, 2011 17,782,571 7,879,198 25,661,769 N E T A S S E T S - JU N E 30, 2012 19,639,388$ 8,646,132$ 28,285,520$ S ee accom panying independent auditors' report and notes to financial statem ents. STATEMENT C CITY OF SOUTH BURLINGTON, VERMONT BALANCE SHEET - GOVERNMENTAL FUNDS JUNE 30, 2012 16 311 Airport O ther Totals G eneral Parkway G overnm ental G overnm ental Fund Expansion Funds Funds ASSETS C ash and cash equivalents 6,644,960$ -$ 553,712$ 7,198,672$ Investm ents - - 368,393 368,393 R eceivables (net of allow ance for uncollectibles): Taxes/liens 197,003 - - 197,003 O ther 368,953 - - 368,953 D ue from other governm ents 485,025 - - 485,025 D ue from agencies - - 75 75 Prepaid expenses 244,188 - - 244,188 D ue from other funds 366,966 2,231,099 2,934,754 5,532,819 TO TAL ASSETS 8,307,095$ 2,231,099$ 3,856,934$ 14,395,128$ LIABILITIES AN D FU N D BALAN C ES LIABILITIES: Accounts payable 793,192$ -$ 18,452$ 811,644$ Accrued payroll 155,456 - - 155,456 Accrued expenses 61,322 - - 61,322 D ue to other funds 5,196,321 - 202,098 5,398,419 D ue to taxpayers 35,795 - - 35,795 D ue to agencies - - 6,188 6,188 D ue to other governm ents 11,615 - 2,428 14,043 D eferred tax revenues 52,288 - - 52,288 O ther liabilities 12,936 - - 12,936 TO TAL LIABILITIES 6,318,925 - 229,166 6,548,091 FU N D BALAN C ES: N onspendable 244,188 - - 244,188 R estricted - - 1,075,563 1,075,563 C om m itted - - 2,612,048 2,612,048 Assigned - - 95,080 95,080 U nassigned 1,743,982 2,231,099 (154,923) 3,820,158 TO TAL FU N D BALAN C ES 1,988,170 2,231,099 3,627,768 7,847,037 TO TAL LIABILITIES AN D FU N D BALAN C ES 8,307,095$ 2,231,099$ 3,856,934$ 14,395,128$ See accom panying independent auditors' report and notes to financial statem ents. STATEMENT D CITY OF SOUTH BURLINGTON, VERMONT RECONCILIATION OF THE GOVERNMENTAL FUNDS BALANCE SHEET TO THE STATEMENT OF NET ASSETS JUNE 30, 2012 17 T otal G overnm ental F unds T otal F und B alances 7,847,037$ A m ounts reported for governm ental activities in the statem ent are different because: C apital assets used in governm ental activities are not financial resources and therefore are not reported in the funds, net of accum ulated depreciation 51,773,741 O ther long-term assets are not available to pay for current-period expenditures and therefore are deferred in the funds show n above: T axes and liens receivable 52,288 Long-term liabilities are not due and payable in the current period and therefore are not reported in the funds: B onds payable (29,876,856) N otes payable (9,211,221) A ccrued com pensated absences (698,905) P ost retirem ent benefits (246,696) N et assets of governm ental activities 19,639,388$ S ee accom panying independent auditors' report and notes to financial statem ents. STATEMENT E CITY OF SOUTH BURLINGTON, VERMONT STATEMENT OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCES GOVERNMENTAL FUNDS FOR THE YEAR ENDED JUNE 30, 2012 18 311 Airport O ther Totals G eneral Parkw ay G overnm ental G overnm ental Fund Expansion Funds Funds R EVEN U ES G eneral tax revenue - m unicipal and education 45,614,174$ -$ -$ 45,614,174$ Intergovernm ental revenue 49,821 - 1,152,241 1,202,062 C harges for services 3,488,866 - 1,310,425 4,799,291 Investm ent incom e 106,838 - 8,500 115,338 O ther revenue - 65,755 237,139 302,894 TO TAL R EVEN U ES 49,259,699 65,755 2,708,305 52,033,759 EXPEN D ITU R ES C urrent: G eneral governm ent 3,131,702 - 169,050 3,300,752 Public safety 8,103,701 - 6,695 8,110,396 Public w orks 2,503,255 - - 2,503,255 Social services 562,711 - - 562,711 R ecreation and culture 1,094,136 - - 1,094,136 D ebt service 1,786,764 - - 1,786,764 Education 31,297,744 - 90,232 31,387,976 Program expenditures - - 16,102 16,102 C apital outlay - 3,057,438 1,218,142 4,275,580 TO TAL EXPEN D ITU R ES 48,480,013 3,057,438 1,500,221 53,037,672 EXC ESS O F R EVEN U ES O VER (U N D ER ) EXPEN D ITU R ES 779,686 (2,991,683) 1,208,084 (1,003,913) O TH ER FIN AN C IN G SO U R C ES (U SES) Bond proceeds - 5,222,782 - 5,222,782 O perating transfers in 5,470,350 4,163,267 2,050,772 11,684,389 O perating transfers (out)(5,901,476) - (5,621,447) (11,522,923) TO TAL O TH ER FIN A NC IN G SO U R C ES (U SES)(431,126) 9,386,049 (3,570,675) 5,384,248 EXC ESS O F R EVEN U ES AN D O TH ER SO U R C ES O VER (U N DE R) EX PEN D ITU R ES AN D O TH ER (U SES)348,560 6,394,366 (2,362,591) 4,380,335 FU N D BALAN C ES - JU LY 1 1,639,610 (4,163,267) 5,990,359 3,466,702 FU N D BALAN C ES - JU N E 30 1,988,170$ 2,231,099$ 3,627,768$ 7,847,037$ See accom panying independent auditors' report and notes to financial statem ents. STATEMENT F CITY OF SOUTH BURLINGTON, VERMONT RECONCILIATION OF THE STATEMENT OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCES OF GOVERNMENTAL FUNDS TO THE STATEMENT OF ACTIVITIES FOR THE YEAR ENDED JUNE 30, 2012 19 N et change in fund balances - total governm ental funds (S tatem ent E )4,380,335$ A mounts reported for governmental activities in the S tatem ent of A ctivities (S tatem ent B ) are different because: G overnm ental funds report capital outlays as expenditures while governm ental activities report depreciation expense allocated to those expenditures over the life of the assets: C apital asset purchases capitalized - R eclassifcation of fixed assets - D epreciation expense (1,176,516) (1,176,516) R evenues in the S tatem ent of A ctivities that do not provide current financial resources are not reported. T axes and liens receivable (35,286) (35,286) D ebt proceeds provide current financial resources to governm ental funds, but long-term liabilities in the Statem ent of N et A ssets.(3,022,782) R epaym ent of long-term debt principal is an expenditure in the governm ental funds, but the repaym ent reduces long-term liabilities in the S tatem ent of N et A ssets.1,749,879 S om e expenses reported in the S tatem ent of A ctivities do not require the use of current financial resources and therefore are not reported as expenditures in governmental funds: P ost retirem ent benefits - F unding of pension liability - A ccrued compensated absences (38,813) C hange in net assets of governm ental activities (S tatem ent B )1,856,817$ S ee accom panying independent auditors' report and notes to financial statem ents. STATEMENT G CITY OF SOUTH BURLINGTON, VERMONT BALANCE SHEET – PROPRIETARY FUNDS JUNE 30, 2012 20 R ecreation W ater W ater A m bulance S torm W ater P rogram s D epartm ent P ollution S ervices U tilities T otals A S SE T S C urrent assets: C ash and cash equivalents -$ 771,400$ -$ -$ 469,894$ 1,241,294$ A ccounts receivable (net of allow ance for uncollectibles): O ther - 601,524 - - - 601,524 D ue from water - billed - - 293,994 - 199,282 493,276 D ue from water - unbilled - 358,634 554,240 - 243,595 1,156,469 Inventory - 64,136 - - - 64,136 P repaid expenses - 515 - - - 515 D ue from other funds 30,468 - - - - 30,468 T otal current assets 30,468 1,796,209 848,234 - 912,771 3,587,682 N oncurrent assets: N et capital assets - 3,906,295 4,639,014 - 885,295 9,430,604 T otal noncurrent assets - 3,906,295 4,639,014 - 885,295 9,430,604 TO TA L A S S E TS 30,468$ 5,702,504$ 5,487,248$ -$ 1,798,066$ 13,018,286$ E nterprise Funds STATEMENT G (CONTINUED) CITY OF SOUTH BURLINGTON, VERMONT BALANCE SHEET – PROPRIETARY FUNDS JUNE 30, 2012 21 Recreation W ater W ate r Am bulan ce Sto rm W ater Programs Departme nt Pollu tion Services Utilities T otals Enterprise Funds LIA B ILITIE S A N D N E T A S S E TS C urrent liabilities: A ccounts payable -$ 192,114$ -$ -$ -$ 192,114$ D ue to other governm ents - 627,028 - - - 627,028 D ue to other funds - - - - 164,868 164,868 C urrent portion of long-term debt - 119,136 245,000 - - 364,136 T otal current liabilities - 938,278 245,000 - 164,868 1,348,146 N oncurrent liabilities: B onds payable - 1,309,008 1,715,000 - - 3,024,008 N otes payable - - - - - - T otal noncurrent liabilities - 1,309,008 1,715,000 - - 3,024,008 TO TA L LIA B ILITIE S - 2,247,286 1,960,000 - 164,868 4,372,154 N E T A S S E TS Invested in capital assets, net of related debt - 2,478,151 2,679,014 - 885,295 6,042,460 R estricted - - - - - - U nrestricted (deficit)30,468 977,067 848,234 - 747,903 2,603,672 TO TA L N E T A S S E TS 30,468 3,455,218 3,527,248 - 1,633,198 8,646,132 TO TA L LIA B ILITIE S A N D N E T AS S E TS 30,468$ 5,702,504$ 5,487,248$ -$ 1,798,066$ 13,018,286$ S ee accom panying independent auditors' report and notes to financial statem ents. STATEMENT H CITY OF SOUTH BURLINGTON, VERMONT STATEMENT OF REVENUES, EXPENSES AND CHANGES IN NET ASSETS – PROPRIETARY FUNDS FOR THE YEAR ENDED JUNE 30, 2012 22 R ecreation W ater W ater A m bulance S torm W ater P rogram s D epartm ent P ollution S ervices U tilities Totals O P E R A TIN G R E V E N U E S Intergovernm ental revenue -$ -$ -$ -$ -$ -$ W ater sales - 1,996,812 - - - 1,996,812 C harges for services 191,425 56,089 3,172,341 - 1,725,560 5,145,415 O ther - 206,637 170,946 - 29,555 407,138 TO TA L O P E R A TIN G R E V E N U ES 191,425 2,259,538 3,343,287 - 1,755,115 7,549,365 O P E R A TIN G E X P E N S E S S alaries and benefits 94,281 411,722 815,177 - 360,952 1,682,132 P rofessional and contracted services 47,008 78,860 837,166 - - 963,034 S upplies, m aterials and fuel 6,200 - 291,151 - 29,006 326,357 W ater purchases - 1,114,122 - - - 1,114,122 C apital outlays - - - - 459,169 459,169 U tilities - - 344,738 - 465 345,203 D epreciation - 210,190 452,730 - 87,644 750,564 C ity adm in fee - 49,600 - - - 49,600 Liability insurance - 31,500 137,758 - 22,167 191,425 M iscellaneous 13,468 141,316 180,989 - 333,591 669,364 TO TA L O P E R A TIN G E X P E N S E S 160,957 2,037,310 3,059,709 - 1,292,994 6,550,970 O P E R A TIN G IN C O M E (LO S S )30,468 222,228 283,578 - 462,121 998,395 E nterprise Funds STATEMENT H (CONTINUED) CITY OF SOUTH BURLINGTON, VERMONT STATEMENT OF REVENUES, EXPENSES AND CHANGES IN NET ASSETS – PROPRIETARY FUNDS FOR THE YEAR ENDED JUNE 30, 2012 23 Recreation W ater W ater Ambulance Storm W ater Program s Departm ent Pollution Services Utilities Totals Enterp rise Fun ds N O N -O P E R A TIN G IN C O M E (E X P E N S E ) O perating transfers in - - 1,294,433 471,436 132,382 1,898,251 O perating transfers (out)(169,349) - (616,927) - (1,273,441) (2,059,717) Interest incom e - - - - - - Interest expense - (69,995) - - - (69,995) TO TA L N O N -O PE R A TIN G IN C O M E (E X P E N S E )(169,349) (69,995) 677,506 471,436 (1,141,059) (231,461) N E T IN C O M E (138,881) 152,233 961,084 471,436 (678,938) 766,934 N E T A S S E TS - JU LY 1 169,349 3,302,985 2,566,164 (471,436) 2,312,136 7,879,198 N E T A S S E TS - JU N E 30 30,468$ 3,455,218$ 3,527,248$ -$ 1,633,198$ 8,646,132$ S ee accom panying independent auditors' report and notes to financial statem ents. STATEMENT I CITY OF SOUTH BURLINGTON, VERMONT STATEMENT OF CASH FLOWS – PROPRIETARY FUNDS FOR THE YEAR ENDED JUNE 30, 2012 24 R ecreation W ater W ater Am bulance S torm W ater P rogram s D epartm ent P ollution S ervices U tilities Totals C A S H FLO W S FR O M O P E R A TIN G A C TIVITIE S R eceipts from customers 330,306$ 1,925,510$ 3,123,418$ 229,286$ 2,621,880$ 8,230,400$ Intergovernm ental receipts - - - - - - O ther receipts - 206,637 170,946 - 29,555 407,138 P aym ents to em ployees (94,281) (411,722) (815,177) - (360,952) (1,682,132) P aym ents to suppliers (66,676) (1,307,250) (2,911,693) (700,722) (679,530) (5,665,871) N et cash provided (used) by operating activities 169,349 413,175 (432,506) (471,436) 1,610,953 1,289,535 C A S H FLO W S FR O M N O N -C AP ITA L FIN A N C IN G A C TIVITIE S Transfers (169,349) - 677,506 471,436 (1,141,059) (161,466) N et cash provided (used) by non-capital financing activities (169,349) - 677,506 471,436 (1,141,059) (161,466) C A S H FLO W S FR O M C A P ITA L A N D R ELA TE D FIN A N C IN G A C TIV IT IES (P urchase) sale of fixed assets - (101,250) - - (101,250) Interest paym ents on bond payable - (69,995) - - - (69,995) P rincipal paym ents on bond/note payable - (116,411) (245,000) - - (361,411) N et cash provided (used) by capital and related financing activities - (287,656) (245,000) - - (532,656) . N E T IN C R E A S E (D E C R E A S E ) IN C A S H - 125,519 - - 469,894 595,413 C A S H - JU LY 1 - 645,881 - - - 645,881 C A S H - JU N E 30 -$ 771,400$ -$ -$ 469,894$ 1,241,294$ E nterprise Funds STATEMENT I (CONTINUED) CITY OF SOUTH BURLINGTON, VERMONT STATEMENT OF CASH FLOWS – PROPRIETARY FUNDS FOR THE YEAR ENDED JUNE 30, 2012 25 R ecreation W ater W ater Ambulance Storm W ater Program s Departm ent Pollution Services Utilities Totals Enterprise Funds R E C O N C ILIAT IO N O F O P E R A TIN G IN C O M E (LO S S ) TO N E T C A S H P R O V ID E D (U S E D ) B Y O P E R A TIN G A C TIV ITIE S : O perating incom e (loss) 30,468$ 222,228$ 283,578$ -$ 462,121$ 998,395$ A djustm ents to reconcile operating income to net cash provided (used) by operating activities: D epreciation expense - 210,190 452,730 - 87,644 750,564 C hanges in operating assets and liabilities: (Increase) decrease in due from water - billed - - (48,923) - (5,607) (54,530) (Increase) decrease in due from water - unbilled - (16,114) - - - (16,114) (Increase) decrease in accounts receivable - (81,203) - 229,286 - 148,083 (Increase) decrease in inventory - (30,071) - - - (30,071) (Increase) decrease in prepaid expenses - (3) - - - (3) (Increase) decrease in due from other funds 138,881 - - - 901,927 1,040,808 (D ecrease) increase in accounts payable - 54,812 - - - 54,812 (D ecrease) increase in due to other governm ents - 53,336 - - - 53,336 (D ecrease) increase in due to other funds - - (1,119,891) (700,722) 164,868 (1,655,745) N E T C A S H P R O V ID E D (U S E D ) B Y O P ER A TIN G A C TIV IT IE S 169,349$ 413,175$ (432,506)$ (471,436)$ 1,610,953$ 1,289,535$ S ee accom panying independent auditors' report and notes to financial statem ents. STATEMENT J CITY OF SOUTH BURLINGTON, VERMONT STATEMENT OF NET ASSETS – FIDUCIARY FUNDS JUNE 30, 2012 26 Pension Trust ASSETS Investm ents, at fair value 27,82 8,248$ D ue from city un funded pension - TO TAL ASSETS 27,82 8,248$ LIABILITIES Accrued ben efits 5,47 3,703$ D ue to em ployee s/retiree s - TO TAL L IABILITIES 5,47 3,703 N ET ASSETS H eld in trust for pension b enefits 22,35 4,545 TO TAL N ET ASSETS 22,35 4,545 TO TAL L IABILITIES AND NET ASSETS 27,82 8,248$ See accom panying independ ent auditors' report and no tes to fina ncial sta tements. CITY OF SOUTH BURLINGTON, VERMONT NOTES TO FINANCIAL STATEMENTS JUNE 30, 2012 27 NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Reporting Entity The City of South Burlington was incorporated under the laws of the State of Vermont. The City operates under City Council-Manager form of government and provides the following services: general government services, public safety, public works, health and welfare, education, and recreation. The City’s financial statements are prepared in accordance with generally accepted accounting principles (GAAP). The Governmental Accounting Standards Board (GASB) is responsible for establishing GAAP for state and local governments through its pronouncements (Statements and Interpretations). Governments are also required to follow the pronouncements of the Financial Accounting Standards Board (FASB) issued through November 30, 1989 (when applicable) that do not conflict with or contradict GASB pronouncements. Although the City has the option to apply FASB pronouncements issued after that date to its business-type activities and enterprise funds, the City has chosen not to do so. The City’s combined financial statements include all accounts and all operations of the City. We have determined that the City has no component units as described in GASB Statement No. 14 and amended by GASB Statement No. 39. Government –Wide and Fund Financial Statements The City’s basic financial statements include both government-wide (reporting the City as a whole) and fund financial statements (reporting the City’s major funds). Both the government-wide and fund financial statements categorize primary activities as either governmental or business-type. The City’s recreation program, water department, water pollution, ambulance services; and storm water utilities are categorized as business-type activities. All other activities of the City are categorized as governmental. In the government-wide Statement of Net Assets, both the governmental and business-type activities columns are (a) presented on a consolidated basis by column, and (b) are reported on a full accrual, economic resources basis, which recognizes all long- term assets and receivables as well as long-term debt and obligations. The City's net assets are reported in three parts - invested in capital assets, net of related debt; restricted net assets; and unrestricted net assets. The City first utilizes restricted resources to finance qualifying activities. CITY OF SOUTH BURLINGTON, VERMONT NOTES TO FINANCIAL STATEMENTS JUNE 30, 2012 28 NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED) The government-wide Statement of Activities reports both the gross and net cost of each of the City's functions and business-type activities (general government, public safety, etc.). The functions are also supported by general government revenues (property taxes, certain intergovernmental revenues, miscellaneous revenues, etc.). The Statement of Activities reduces gross expenses (including depreciation) by related program revenues, operating and capital grants. Program revenues must be directly associated with the function or a business-type activity. Operating grants include operating-specific and discretionary (either operating or capital) grants while the capital grants column reflects capital-specific grants. For the most part, the interfund activity has been eliminated from these government–wide financial statements. The net costs (by function) are normally covered by general revenue (taxes, certain intergovernmental revenues and charges for services, etc.). The City does not allocate indirect costs. All costs are charged directly to the corresponding department. The government-wide focus is more on the sustainability of the City as an entity and the change in the City’s net assets resulting from the current year’s activities. Measurement Focus - Basic Financial Statements & Fund Financial Statements The financial transactions of the City are reported in the individual funds in the fund financial statements. Each fund is accounted for by providing a separate set of self- balancing accounts that comprise its assets, liabilities, fund balances, revenues and expenditures/expenses. The various funds are reported by generic classification within the financial statements. The following fund types are used by the City: 1. Governmental Funds: The focus of the governmental funds' measurement (in the fund statements) is upon determination of financial position (sources, uses, and balances of financial resources) rather than upon net income. The following is a description of the governmental funds of the City: a. 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. CITY OF SOUTH BURLINGTON, VERMONT NOTES TO FINANCIAL STATEMENTS JUNE 30, 2012 29 NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED) b. Special Revenue Funds are used to account for the proceeds of specific revenue sources that are legally restricted to expenditures for specified purposes. c. Capital Project Funds are used to account for financial resources to be used for the acquisition or construction of major capital facilities or equipment. d. Permanent Funds are used to account for assets held by the City in trust for specific purposes. 2. Proprietary Funds The focus of proprietary fund measurement is upon determination of operating income, changes in net assets, financial position, and cash flows. The generally accepted accounting principles applicable are those similar to businesses in the private sector. Operating revenues include charges for services, intergovernmental reimbursements and other miscellaneous fees which are a direct result of the proprietary activity. Non-operating revenues are any revenues which are generated outside of the general proprietary activity, i.e. interest income. The following is a description of the proprietary funds of the City: a. Enterprise Funds are required to be used to account for operations for which a fee is charged to external users for goods or services and the activity (a) is financed with debt that is solely secured by a pledge of net revenues, (b) has third-party requirements that the cost of providing. services, including capital costs, be recovered with fees and charges or (c) established fees and charges based on a pricing policy designed to recover similar costs. 3. Fiduciary Funds: Fiduciary funds are used to report assets held in a trustee or agency capacity for others and therefore are not available to support City programs. The reporting focus is on net assets and changes in net assets and are reported using accounting principles similar to proprietary funds. The City’s fiduciary funds are presented in the fiduciary fund financial statements by type (pension trust). Since by definition these assets are being held for the benefit of a third-party (other local governments, private parties, etc.) and cannot be used to address activities or obligations of the government, these funds are not incorporated into the government-wide financial statements. CITY OF SOUTH BURLINGTON, VERMONT NOTES TO FINANCIAL STATEMENTS JUNE 30, 2012 30 NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED) The emphasis in fund financial statements is on the major funds in either the governmental or business-type activities categories. Non-major funds by category are summarized into a single column, GASB Statement No. 34 sets forth minimum criteria (percentage of the assets, liabilities, revenues, or expenses of either the fund category or the governmental and enterprise combined) for the determination of major funds. The nonmajor funds are combined in a column in the fund financial statements. Basis of Accounting Basis of accounting refers to when revenues and expenditures or expenses are recognized in the accounts and reported in the financial statements. Basis of accounting relates to the timing of the measurements made, regardless of the measurement focus applied. 1. Accrual Governmental activities in the government-wide financial statements and fiduciary fund financial statements are presented on the accrual basis of accounting. Revenues are recognized when earned and expenses are recognized when incurred. 2. Modified Accrual The governmental fund financial statements are presented on the modified accrual basis of accounting. Under the modified accrual basis of accounting, revenues are recorded when susceptible to accrual; i.e., both measurable and available. "Available" means collectible within the current period or soon enough thereafter to be used to pay liabilities of the current period. Expenditures are generally recognized under the modified accrual basis of accounting when the related liability is incurred. The exception to this general rule is that principal and interest on general obligation long-term debt, if any, is recognized when due. CITY OF SOUTH BURLINGTON, VERMONT NOTES TO FINANCIAL STATEMENTS JUNE 30, 2012 31 NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED) Budget The City’s policy is to adopt an annual budget for operations. The budget is presented on the modified accrual basis of accounting which is consistent with generally accepted accounting principles. The following procedures are followed in establishing budgetary data reflected in the financial statements: 1. Early in the second half of the year the City prepares a budget for the fiscal year beginning July 1. The operating budget includes proposed expenditures and the means of financing them. 2. A meeting of the City Council was called for the purpose of adopting the proposed budget after public notice of the meeting was given. 3. The budget was adopted subsequent to passage by the Voters. 4. The City did not adopt budgets for Special Revenue Funds. Deposits and Investments The City’s cash and cash equivalents are considered to be cash on hand, demand deposits and short-term investments with original maturities of three months or less from the date of acquisition. It is the City’s policy to value investments at fair value. None of the City’s investments are reported at amortized cost. For purposes of the statement of cash flows, all highly liquid investments with a maturity of three months or less when purchased are considered to be a cash equivalent. The City Treasurer is authorized by State Statutes to invest all excess funds in the following: - Obligations of the U.S. Government, its agencies and instrumentalities. - Certificates of deposits and other evidences of deposits at banks, savings and loan associations, and credit unions. - Repurchase agreements - Money market mutual funds The City of South Burlington has no formal investment policy but instead follows the State of Vermont Statutes. They are in the process of adopting a more detailed investment policy. CITY OF SOUTH BURLINGTON, VERMONT NOTES TO FINANCIAL STATEMENTS JUNE 30, 2012 32 NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED) Inventories Inventories of supplies are considered to be expenditures at the time of purchase and are not included in the general fund balance sheet. The enterprise fund inventory consists of water department supplies on hand at the end of the year, valued at cost. The cost value is determined using the first-in, first-out (FIFO) method. Interfund Receivables and Payables Any residual balances outstanding between governmental activities and business- type activities are reported in the governmental-wide financial statements as “internal balances”. Interfund balances and transactions have been eliminated in the government- wide financial statements. Transactions Between Funds Legally authorized transfers are treated as interfund transfers and are included in the results of operations of both Governmental and Proprietary Funds. Allowance for Uncollectible Accounts The allowance for uncollectible accounts is estimated to be $244,167 as of June 30, 2012. The allowance is for ambulance receivables in the enterprise funds. Capital Assets Capital assets purchased or acquired with an original cost of $5,000 or more are reported at historical cost or estimated historical cost. Contributed assets are reported at fair market value as of the date received. Additions, improvements and other capital outlays that significantly extend the useful life of an asset are capitalized. Infrastructure such as streets, traffic signals, and signs are capitalized. Other costs incurred for repairs and maintenance are expensed as incurred. Depreciation on all assets is provided on the straight-line basis over the estimated useful lives. The assets are valued at historical cost when available and estimated historical cost where actual invoices or budgetary data was unavailable. Donated fixed assets are valued at their estimated fair market value on the date received. All retirements have been recorded by eliminating the net carrying values. Infrastructure assets include roads, bridges, underground pipe (other than related to independently owned utilities), traffic signals, etc. These infrastructure assets are likely to be the largest asset class of the City. CITY OF SOUTH BURLINGTON, VERMONT NOTES TO FINANCIAL STATEMENTS JUNE 30, 2012 33 NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED) Estimated useful lives are as follows: Buildings 20 - 50 years Infrastructure 50 - 100 years Machinery and equipment 3 - 50 years Vehicles 3 - 25 years Long-term Obligations The accounting treatment of long-term debt depends on whether the assets are used in governmental fund operations or proprietary fund operations and whether they are reported in the government-wide or fund financial statements. All long-term debt to be repaid from governmental and business-type resources is reported as liabilities in government-wide statements. The long-term debt consists primarily of notes or bonds payable and compensated absences. Long-term debt for governmental funds is not reported as liabilities in the fund financial statements. The debt proceeds are reported as other financing sources and payment of principal and interest reported as expenditures. The accounting for proprietary fund is the same in the fund statements as it is in the government-wide statements. Compensated Absences The City’s policies regarding vacation and sick time do permit employees to accumulate earned but unused vacation and sick leave. The liability for these compensated absences is recorded as long-term debt in the government-wide financial statements. In the fund financial statements, governmental funds report only the compensated absence liability payable from expendable available financial resources, while the proprietary funds report the liability as it is incurred. As of June 30, 2012 the City’s liability for compensated absences is $660,092. CITY OF SOUTH BURLINGTON, VERMONT NOTES TO FINANCIAL STATEMENTS JUNE 30, 2012 34 NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED) Net Assets / Fund Balance Net assets represent the difference between assets and liabilities. Net assets invested in capital assets, net of related debt consists of capital assets, net of accumulated depreciation, reduced by the outstanding balances of any borrowing used for those assets, and adding back unspent proceeds. Net assets are reported as restricted when there are limitations imposed on their use either through the enabling legislations adopted by the City or through external restrictions imposed by creditors, grantors or laws or regulations of other governments. In the fund financial statements, fund balance for governmental funds is reported in classifications that comprise a hierarchy based primarily on the extent to which the City is bound to honor constraints on the specific purpose for which amounts in the funds can be spent. Fund balance is reported in five components – nonspendable, restricted, committed, assigned and unassigned. Nonspendable – This includes amounts that cannot be spent either because they are not in spendable form or because they are legally or contractually required to be maintained intact. Restricted – This includes amounts that can be spent only for specific purposes because of constitutional provisions or enabling legislation or because of constraints that are externally imposed by creditors, grantors, contributors, or the laws or regulations of other governments. Committed – This includes amounts that can be used only for specific purposes determined by a formal action of the inhabitants of the City. The inhabitants of the City through City meetings are the highest level of decision-making authority of the City. Commitments may be established, modified, or rescinded only through a City meeting vote. Assigned – This includes amounts that do not meet the criteria to be classified as restricted or committed but that are intended to be used for specific purposes. The authority for assigning fund balance is expressed by the City Council. Unassigned – This includes all other spendable amounts. The general fund is the only fund that reports a positive unassigned fund balance amount. Other governmental funds besides the general fund can only report a negative unassigned fund balance amount. CITY OF SOUTH BURLINGTON, VERMONT NOTES TO FINANCIAL STATEMENTS JUNE 30, 2012 35 NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED) When an expenditure is incurred for purposes for which both restricted and unrestricted fund balances are available, the City considers restricted funds to have been spent first. When an expenditure is incurred for which committed, assigned, or unassigned fund balances are available, the City considers amounts to have been spent first out of committed funds, then assigned funds, and finally unassigned funds, as needed, unless the City meeting vote has provided otherwise in its commitment or assignment actions. Revenue Recognition - Property Taxes - Modified Accrual Basis The City's property tax for the current year was levied July 2, 2011 on the assessed value listed as of April 1, 2011, for all real and personal property located in the City. Taxes were due on August 15, 2011, November 15, 2011 and March 15, 2012. Interest on unpaid taxes commenced on August 16, 2011, November 16, 2011 and March 16, 2012, at 8% penalties and 1% interest per installment. Property tax revenues are recognized when they become available. Available includes those property tax receivables expected to be collected within sixty days after year end. The remaining receivables have been recorded as deferred revenues. Tax liens are placed on real property within twelve months following the tax commitment date if taxes are delinquent. The City has the authority to foreclose on property eighteen months after the filing of the lien if tax liens and associated costs remain unpaid. The City’s property tax collection rate for the current year was 97.75%. Program Revenues Program revenues include all directly related income items applicable to a particular program (grant income/expenses). Operating/Non-operating Proprietary Fund Revenues Operating revenues consist mainly of direct revenue sources and/or charges for services applicable to that fund. CITY OF SOUTH BURLINGTON, VERMONT NOTES TO FINANCIAL STATEMENTS JUNE 30, 2012 36 NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED) Encumbrance Accounting Encumbrances are not liabilities and, therefore, are not recorded as expenditures until receipt of material or service. For budgetary purposes, appropriations lapse at fiscal year-end. The City does not utilize encumbrance accounting for its general fund. Use of Estimates During the preparation of the City’s financial statements, management is required to make estimates and assumptions that affect the reported amounts of assets, liabilities, and disclosure of contingent items as of the date of the financial statements and the reported amounts of revenues and expenses/expenditures during the reporting period. Actual results may differ from these estimates. NOTE 2 - CASH AND INVESTMENTS The City’s policies, which follow state statutes, authorize the City to invest in obligations of the U.S. Treasury, agencies and instrumentalities, other states and Canada, provided such securities are rated within the three highest grades by an approved rating service of the State of Vermont, corporate stocks and bonds within statutory limits, financial institutions, mutual funds and repurchase agreements. These investment policies apply to all City funds. Custodial credit risk for deposits is the risk that, in the event of a failure of a depository financial institution, the City will not be able to recover its deposits or will not be able to recover collateral securities that are in possession of an outside party. The City does not have a policy covering custodial credit risk. At June 30, 2012, the City’s cash balance of $8,439,966 was comprised of bank deposits amounting to $8,942,871. This amount was comprised of $250,000 which was insured by federal depository insurance and consequently was not exposed to custodial credit risk and $8,692,871 that was in excess of federal depository insurance, but collateralized with securities held by financial institutions in the City’s name. Bank Account Typ e Balance Checkin g accounts 8,942,87 1$ 8,942,87 1$ CITY OF SOUTH BURLINGTON, VERMONT NOTES TO FINANCIAL STATEMENTS JUNE 30, 2012 37 NOTE 2 - CASH AND INVESTMENTS (CONTINUED) At June 30, 2012, all of the City’s investments of $28,196,641 were not collateralized. Investm ent Type C urrent 1 Year 2 - 5 Y ears T hereafter P rudential: U .S . S tocks -$ -$ -$ 7,726,571$ International S tocks - - - 3,269,680 U .S . B onds - - - 1,905,659 S hort term - - - 8,656,507 R eal estate - - - 796,129 IC M A : M oney m arket funds - - - 1,671,143 B ond funds - - - 507,870 A ssett allocation funds - - - 1,352,275 U .S . S tocks - - - 1,639,209 International S tocks - - - 303,205 W ells Fargo: C ash equivalent 14 - - - A sset backed securities - - - 24,587 M utual funds 280,987 - - - Fixed rate cap securities 62,805 - - - 343,806$ -$ -$ 27,852,835$ Credit risk – Statutes for the State of Vermont authorize the City to invest in obligations of the U.S. Treasury, agencies and instrumentalities, other states and Canada, provided such securities are rated within the three highest grades by an approved rating service of the State of Vermont, corporate stocks and bonds within statutory limits, financial institutions, mutual funds and repurchase agreements. The City does not have an investment policy on credit risk. Generally, the Vermont invests excess funds in savings and money market accounts. Interest rate risk – is the risk that changes in interest rates will adversely affect the fair value of an investment. The City does not have a policy related to interest rate risk. CITY OF SOUTH BURLINGTON, VERMONT NOTES TO FINANCIAL STATEMENTS JUNE 30, 2012 38 NOTE 3 - INTERFUND RECEIVABLES AND PAYABLES Interfund balances at June 30, 2012 consisted of the following individual fund receivables and payables. R eceivables P ayables (D ue from )(D ue to) G eneral fund 366,966$ 5,196,321$ A irport parkw ay expansion fund 2,231,099 - S pecial revenue fund 1,433,270 56,957 C apital project fund 1,389,505 144,096 P ermanent fund 111,979 1,045 E nterprise fund 30,468 164,868 5,563,287$ 5,563,287$ NOTE 4 - CAPITAL ASSETS The following is a summary of changes in capital assets at June 30, 2012: Balance,Balanc e, 7/1/11 Additions D ispo sals 6/30/1 2 G overnm ental activities N on-dep reciated a ssets: Land 6 ,030,263$ -$ -$ 6,030,2 63$ C onstruction in p rogress 28 ,571,251 - - 28,571,2 51 34 ,601,514 - - 34,601,5 14 D epreciated assets: Land Im provem ents 71,703 - - 71,7 03 Buildings 16 ,206,462 - - 16,206,4 62 Building improvem ents 559,798 - - 559,7 98 M achinery & equipm ent 1 ,882,010 - - 1,882,0 10 Vehicles 4 ,415,644 - - 4,415,6 44 Infrastructure 38 ,956,490 - - 38,956,4 90 62 ,092,107 - - 62,092,1 07 Less: accum ulate d depreciation (43 ,743,364) (1 ,176,516) - (44,919,8 80) 18 ,348,743 (1 ,176,516) - 17,172,2 27 N et capital assets 52 ,950,257$ (1 ,176,516)$ -$ 51,773,7 41$ CITY OF SOUTH BURLINGTON, VERMONT NOTES TO FINANCIAL STATEMENTS JUNE 30, 2012 39 NOTE 4 - CAPITAL ASSETS (CONTINUED) Bala nce,Balance, 7/1/11 Additions D isposals 6/30/12 Busines s-type activities N on-dep reciated a ssets: Land / co nstruction in progress 518 ,000$ -$ -$ 518,000$ 518 ,000 - - 518,000 D epreciated assets: Buildings 5,952 ,242 - - 5,952,242 Building improvem ents 11 ,130 - - 11,130 Land improve ments 7,362 ,506 - - 7,362,506 Vehicles 811 ,164 - - 811,164 M achinery & equipm ent 6,849 ,653 101,25 0 - 6,950,903 Storm water utilities 1,290 ,352 - - 1,290,352 22,277 ,047 101,25 0 - 22,378,297 Less: accum ulate d depreciation (12,715 ,129) (750,56 4) - (13,465,693) 9,561 ,918 (649,31 4) - 8,912,604 N et capital assets 10,079 ,918$ (649,31 4)$ -$ 9,430,604$ C urrent year depreciation Fire 148,5 16$ Public works 363,7 07 G enera l governm ent 3,2 98 H ealth 3,6 10 Police 384,3 43 R ecreation 84,3 60 H ighw ay 188,3 44 Library 3 38 Subtotal governm ental 1,176,5 16 W ater d epartmen t 210,1 90 W ater p ollution control 452,7 30 Storm water utilities 87,6 44 Subtotal busness-type 750,5 64 Total depreciation expense 1,927,0 80$ CITY OF SOUTH BURLINGTON, VERMONT NOTES TO FINANCIAL STATEMENTS JUNE 30, 2012 40 NOTE 5 - LONG TERM DEBT The following is a summary of changes in the long-term debt for the year ended June 30, 2012: D ue Balance,Balance,W ithin 7/1/11 Additions D eletions 6/30/12 O ne Year G overnm ental Activities Bonds payable 30,615,445$ -$ (738,589)$ 29,876,856$ 735,864$ N otes payable 10,222,511 - (1,011,290) 9,211,221 806,335 Accrued com pensated absences 660,092 38,813 - 698,905 - Total G overnm ental Activities 41,498,048$ 38,813$ (1,749,879)$ 39,786,982$ 1,542,199$ Business-type Activities Bonds payable 3,749,555$ -$ (361,411)$ 3,388,144$ 364,136$ Total Business-type Activities 3,749,555$ -$ (361,411)$ 3,388,144$ 364,136$ CITY OF SOUTH BURLINGTON, VERMONT NOTES TO FINANCIAL STATEMENTS JUNE 30, 2012 41 NOTE 5 - LONG TERM DEBT (CONTINUED) The following is a summary of outstanding bonds payable: G ov ern m e ntal B u sines s-typ e B ond s $ 700 ,000 ,1 99 2 G en eral O blig atio n B ond du e in ann ua l in stallm en ts and s em ia nnu al interest in stallm en ts throug h D ec em ber 2 012 .In te re st is c harge d at a rate of 6.21 % p er a nnu m . A nnu al ins ta llm ents are $3 5,000 .3 5,000$ -$ $8 00 ,0 00,19 93 G en eral O bligation B o nd du e in an nu al ins ta llm ents and s em ia nnu al interest in stallm en ts throug h D ec em ber 2 013 .In te re st is c harge d at a rate of 5.27 % p er a nnu m . A nnu al ins ta llm ents are $4 0,000 . 8 0,000 - $ 2,435 ,000 ,2 000 G ene ra l O bligation B o nd d ue in an nua l installm e nts a nd s em ia nnu al interes t installm e nts th ro ugh D e cem be r 20 20 .Interes t is c harge d at a rate of 5.23 % p er a nnu m . A nnu al ins ta llm ents are $1 20,00 0. 88 7,003 19 2,99 7 $ 4,900 ,000 ,1 998 G ene ra l O bligation B o nd d ue in an nua l installm e nts a nd sem iann ua l in te re st in stallm en ts throug h A pril 2 020 .Intere st is n ot c harge d . A nn ual in stallm en ts a re $2 45 ,0 00. - 1,96 0,00 0 $ 1,300 ,000 ,2 003 G ene ra l O bligation B o nd d ue in an nua l installm e nts a nd s em ia nnu al interes t installm e nts th ro ugh D e cem be r 20 13 .Interes t is c harge d at a rate of 2 .9 78 %pe r an num .A n nua l insta llm e nts are $ 130 ,000 . 26 0,000 - $ 3,400 ,000 ,2 004 G ene ra l O bligation B o nd d ue in an nua l installm e nts a nd s em ia nnu al interes t installm e nts th ro ugh D e cem be r 20 24 .Interes t is c harge d at a rate of 4 .4 55 %pe r an num .A n nua l insta llm e nts are $ 170 ,000 . 97 4,853 1,23 5,14 7 $ 7,200 ,000 ,2 010 G ene ra l O bligation B o nd d ue in an nua l installm e nts a nd s em ia nnu al interes t installm e nts th ro ugh D e cem be r 20 30 .Interes t is c harge d at a rate of 4.34 % p er a nnu m . A nnu al ins ta llm ents are $3 60,00 0. 6,84 0,000 - $ 2,000 ,000 ,2 010 G ene ra l O bligation B o nd d ue in an nua l installm e nts a nd s em ia nnu al interes t installm e nts th ro ugh D e cem be r 20 22 .Interes t is c harge d at a rate fro m 3.25 %to 4 .7 5%p er an num .$1 ,0 00,00 0 wa s p aid b y A R R A fund in g. 1,00 0,000 - $ 19,80 0,00 0,2 01 0 G en era l O bligation B ond d ue in an nua l installm e nts a nd sem iann ual interest ins ta llm e nts throu gh A pril 20 30.Intere st is c harge d at 1 .0 0% per a nn um . A nn ual Ins ta llm ents va ry. 1 9,80 0,000 - 2 9,87 6,856$ 3,38 8,14 4$ CITY OF SOUTH BURLINGTON, VERMONT NOTES TO FINANCIAL STATEMENTS JUNE 30, 2012 42 NOTE 5 – LONG TERM DEBT (CONTINUED) The following is a summary of outstanding notes payable: N o te s G ov ern m e ntal B u sines s-typ e $5 87,00 0 N ote pa yab le to N orthfield S av in gs B a nk for a f ire truc k w ith interest at 2.40% .N ote m atures on J uly 15 ,2 01 5 w ith ann ual prin cipal ins ta llm ents of $1 46 ,7 50 . 58 7,000$ -$ $1 04,00 0,G e neral O b liga tion N ote from th e P o llution C ontrol R evo lv ing L oan F un d du e in ann ua l prin cipa l ins ta llm ents w ith interest be ing fo rg ive n. $ 52,00 0 w as pa id by A R R A fun din g. 4 2,008 - $6 76 ,5 00 N ote p aya ble to C itize ns B a nk fo r 2 fire tru cks w ith in te res t at 3 .0 5% .N ote m a tu res on S e ptem be r 1 6,2 012 w ith a nnu al installm e nts of $ 169 ,125 . 16 9,125 - $9 0,310 ,G en eral O blig atio n N ote from the P o llutio n C ontro l R evo lv ing L oan F un d du e in ann ua l prin cipa l ins ta llm ents w ith interest be ing fo rg ive n. $ 45,15 5 w as pa id by A R R A fun din g. 3 6,478 - $7 4,000 ,G en eral O blig atio n N ote from the P o llutio n C ontro l R evo lv ing L oan F un d du e in ann ua l prin cipa l ins ta llm ents w ith interest be ing fo rg ive n. $ 37,00 0 w as pa id by A R R A fun din g. 3 7,000 - $2 13,31 6,G e neral O b liga tion N ote from th e P o llution C ontrol R evo lv ing L oan F un d du e in ann ua l prin cipa l ins ta llm ents w ith interest be ing fo rg ive n. $ 106 ,6 58 w a s p aid by A R R A fu nding . 8 6,163 - $1 98,28 1,G e neral O b liga tion N ote from th e P o llution C ontrol R evo lv ing L oan F un d du e in ann ua l prin cipa l ins ta llm ents w ith interest be ing fo rg ive n. $ 99,14 0 w as pa id by A R R A fun din g. 8 0,090 - $ 54 ,3 04 N ote p aya ble to C hitten de n B ank for a track le ss sidew a lk plow w ith in tere st at 2.40% .N o te m a tu re s on De cem b er 1 4,2 011 at w h ich tim e it m ay b e re fin anc ed. 1 8,100 - $8 3,42 2 No te pay able to C hitten den B ank fo r a high wa y load er w ith interest at 2 .4 0% .N ote m a tu res on D ec em ber 1 4,20 11 at w hich tim e it m ay b e re fin anc ed. 2 7,807 - $6 6,79 8 N ote pa yab le to C hitten den B ank for a du m p truck w ith interest at 2.40% .N ote m atures on D e cem be r 14,2 011 at w h ich tim e it m a y be refina nce d. 2 2,266 - CITY OF SOUTH BURLINGTON, VERMONT NOTES TO FINANCIAL STATEMENTS JUNE 30, 2012 43 NOTE 5 - LONG TERM DEBT (CONTINUED) N o te s G ov ern m e ntal B u sines s-typ e $300,000 N ote payable to TD Bank for storm w ater m itigation w ith interest at 1.84% .Note m atures on January 21,2012 at w hich tim e it m ay be refinanced. 200,000 - $8,168,158 N ote payable to Merchants Bank for Pension Financing w ith interest at 5.125% .N ote m atures on June 30,2031 w ith annual installm ents of $660,948. 7,905,184 - 9,211,221$ -$ The following is a summary of outstanding bond principal and interest requirements for the following fiscal years ending June 30: Bonds Payable Total Principal Interest Debt Service 2013 1,100,000$ 429,558$ 1,529,558$ 2014 1,879,903 818,600 2,698,503 2015 1,726,201 775,213 2,501,414 2016 1,783,982 734,549 2,518,531 2017 1,801,762 691,833 2,493,595 2018-2022 8,678,198 2,767,980 11,446,178 2023-2027 7,624,161 1,640,291 9,264,452 2028-2032 7,307,263 625,737 7,933,000 2033-2037 1,363,530 24,942 1,388,472 33,265,000$ 8,508,703$ 41,773,703$ CITY OF SOUTH BURLINGTON, VERMONT NOTES TO FINANCIAL STATEMENTS JUNE 30, 2012 44 NOTE 5 - LONG TERM DEBT (CONTINUED) The following is a summary of outstanding note principal and interest requirements for the following fiscal years ending June 30: Notes Payable Total Principal Interest Debt Service 2013 806,335$ 435,203$ 1,241,538$ 2014 583,496 408,777 992,273 2015 498,626 388,340 886,966 2016 513,500 369,893 883,393 2017 320,064 348,734 668,798 2018-2022 2,239,677 1,486,618 3,726,295 2023-2027 1,912,934 970,251 2,883,185 2028-2032 2,336,589 307,205 2,643,794 9,211,221$ 4,715,021$ 13,926,242$ NOTE 6 - NONSPENDABLE FUND BALANCES At June 30, 2012, the City had the following nonspendable fund balance: Prepaid expenses 244,188$ NOTE 7 - RESTRICTED FUND BALANCES At June 30, 2012, the City had the following restricted fund balances: Nonmajor special revenue funds (Schedule D)915,306$ Nonmajor capital project funds (Schedule F)393,199 Nonmajor permanent funds (Schedule H)467,933 1,776,438$ CITY OF SOUTH BURLINGTON, VERMONT NOTES TO FINANCIAL STATEMENTS JUNE 30, 2012 45 NOTE 8 - COMMITTED FUND BALANCES At June 30, 2012, the City had the following committed fund balances: Nonmajor special revenue funds (Schedule D)3,277,238$ Nonmajor capital project funds (Schedule F)1,626,900 Nonmajor permanent funds (Schedule H)6,092 4,910,230$ NOTE 9 - ASSIGNED FUND BALANCES At June 30, 2012, the City had the following assigned fund balances: Nonmajor special revenue funds (Schedule D)95,080$ NOTE 10 - RISK MANAGEMENT – PARTICIPATION IN A PUBLIC ENTITY RISK POOL The City of South Burlington, Vermont is a member of Vermont League of Cities and Towns (VLCT). The VLCT has established three insurance trusts: the Property and Casualty Intermunicipal Fund, Inc. (PACIF) for multi-line insurance; The Vermont League of Cities and Towns Health Trust (VLCTHT) for health, life and disability coverage; and the Vermont league of Cities and Towns Unemployment Trust, Inc. (VLCTUT) for unemployment compensation. PACIF, VLCTHT and VLCTUT are nonprofit corporations formed to provide insurance and risk management programs for Vermont cities and towns and is owned by the participating members. The Trusts are not licensed insurance carriers and members are not protected by the Vermont Insurance Guaranty Association. To provide insurance coverage, PACIF has established a self-funded insurance trust. It provides extensive coverage for losses to member municipalities for property damage, auto accidents, injured employees, public official liability and employment practices liability. Members gain additional benefits from PACIF’s unique public safety and risk management programs as well as dedicated in-house claims adjusters. In the event that total contributions assessed to and made by all members result in a actual or projected financial deficit and PACIF is unable to meet its required obligations, the program will be terminated with each member assessed their proportionate share of the deficit. CITY OF SOUTH BURLINGTON, VERMONT NOTES TO FINANCIAL STATEMENTS JUNE 30, 2012 46 NOTE 10 - RISK MANAGEMENT – PARTICIPATION IN A PUBLIC ENTITY RISK POOL (CONTINUED) To provide health insurance coverage, VLCTHT has established a self-funded fully insured program in conjunction with Connecticut General (CIGNA). A portion of member contributions is used to purchase reinsurance and to fund a reserve required by the reinsurance. Other health related benefits available include dental insurance, flexible spending accounts, life insurance, disability insurance and long-term care insurance. Contributions in excess of claims requirements, reserve fund requirements, reinsurance and administrative costs are returned to participants. The pooling agreement does not permit the pool to make additional assessments to its members. To provide unemployment coverage, VLCTUT has established a separate trust of funds from member contributions to pay administrative costs, unemployment claims and provide excess reinsurance protection. Contributions are based on payroll expense and the previous two year unemployment compensation experience. In the event that total contributions assessed to and made by all members result in an actual or projected financial deficit and VLCTUT is unable to meet its required obligations, the program will be terminated with each members assessed their proportionate share of the deficit. NOTE 11 - RETIREMENT INCENTIVES The City will permit any employee with 15 years or more of service to exchange 160 hours of sick leave plus 16 additional sick leave hours per year of service beyond 15 years towards early retirement in the year of retirement. Life insurance is offered to all retirees for the rest of their lives. The present cost is different for each person. There are 32 people presently receiving life insurance benefits with a cost to the city of $480. The liability will change from year to year based on the cost of the insurance and the number of people receiving the insurance benefit. Pursuant to employment contracts with the employees of the police and fire departments, the City offers a plan that uses accumulated unused sick time to pay for the loss of health insurance upon their retirement. The amount of unused sick time hours multiplied by the employee’s hourly rate is the amount credited to a sick leave bank to pay the cost of insurance. The amount is actually unfunded and treated as a “pay as you go” plan. As of June 30, 2012, this amount has been estimated at $3,058,913. CITY OF SOUTH BURLINGTON, VERMONT NOTES TO FINANCIAL STATEMENTS JUNE 30, 2012 47 NOTE 12 - DEFINED BENEFIT PENSION PLAN The City of South Burlington, Vermont, sponsors one defined benefit pension plan with two components that cover all eligible employees. One component is for public safety employees (fire and police) and the other component is for all other City employees. The City of South Burlington, Vermont, provides the authority under which benefit provisions are established and the City’s obligation to contribute is established. The plan calls for benefits to be paid to eligible employees at retirement based primarily upon years of service with the City and compensation rates near retirement. Non-public safety employees earn 1.75 percent of average monthly compensation per year of service. Average monthly compensation means the monthly compensation of a participant averaged over the three (3) consecutive plan years for the date of employment, including periods prior to the effective date of the plan, which produce the highest monthly average. If a participant has less than three (3) consecutive plan years of service between the date of employment to the date of termination, the average monthly compensation will be based on the monthly compensation during the months of service from the date of employment to the date of termination. Public safety employees earn 2.5 percent of average monthly compensation per year of service limited to 25 years. Average monthly compensation means the monthly compensation of a participant average over the three (3) highest consecutive years of the last ten (10) years from the date of employment, including periods prior to the effective date of the plan, which produce the highest monthly average. If a participant has less than three (3) consecutive plan years of service from the date of employment to the date of termination, the average monthly compensation will be based on the monthly compensation during the months of service from the date of employment to the date of termination. Public safety employees contribute 6.5% of their base salary in the plan. The Plan provides death and disability benefits. Employees become eligible after three years of service. Benefits vest 20 percent per year upon eligibility. Employees are 100 percent vested after five years of participation that occurs at the end of the seventh year. Normal retirement for the non-public safety employees is age 65 with early retirement at age 60. Normal retirement for public safety employees is age 53 with early retirement at age 50. Contributions to the plan reflect benefits attributed to employees’ services to date, as well as services expected to be earned in the future. CITY OF SOUTH BURLINGTON, VERMONT NOTES TO FINANCIAL STATEMENTS JUNE 30, 2012 48 NOTE 12 - DEFINED BENEFIT PENSION PLAN (CONTINUED) At June 30, 2012, the number of participants consisted of: N on-P ublic Public S afety S afety G roup R etired participants currently receiving benefits 23 32 Term inated vested or inactive but still em ployeed 8 30 P articipants currently em ployed:70 35 Total participants 101 97 Ineligible em ployees 0 11 The City of South Burlington, Vermont’s current year aggregate compensation of active participants in the pension plan equaled $5,299,232. The following sets forth the determination of normal cost of the plan for the year ended June 30, 2012: N on-P ublic Public S afety S afety G roup 1. A ctual present value of future benefits: A . Inactive participants 8,220,273$ 3,705,748$ B . A ctive participants 11,975,289 4,518,371 C . Total 20,195,562 8,224,119 2. A ctuarial asset value:16,322,208 6,032,342 3. P resent value of future em ployee contributions:1,651,784 - 4. U nfunded entry age accrued liability:252,369 779,045 5. P resent value of future norm al cost (1C -2-3-4):1,969,201 1,412,732 6. P resent value of future payroll:25,412,056 15,299,527 7. N ormal cost accrual rate (5/6):7.7491%9.2338% 8. C urrent payroll:3,611,303 1,687,929 9. N ormal cost (7*8):279,843 155,860 CITY OF SOUTH BURLINGTON, VERMONT NOTES TO FINANCIAL STATEMENTS JUNE 30, 2012 49 NOTE 12 - DEFINED BENEFIT PENSION PLAN (CONTINUED) The following sets forth the actuarial present value of accumulated plan benefits as for June 30, 2012: N on-P ublic Public S afety S afety G roup A ctuarial present value of vested accumulated plan benefits Inactive participants (retirees, term vested):8,220,273$ 3,705,748$ A ctively em ployed participants 8,005,060 2,028,424 P resent value of vested accumulated benefits 16,225,333 5,734,172 P resent value of non-vested accum ulated benefits 152,059 42,192 Total present value of future benefits 16,377,392 5,776,364 A ctuarially com puted value of accrued vested P lan assets available to provide benefits 16,322,209 6,032,341 U nfunded pension benefit obligation - - F unded ratio 99.7%104.4% The following sets forth the asset fair market value of accumulated plan benefits as for June 30, 2012: N on-P ublic Public S afety S afety G roup A sset fair m arket value at July 1, 2011:16,224,502$ 5,916,216$ A dditional bond proceeds 578 122 E mployer contributions:245,628 354,372 M andatory employee contributions:282,608 - B enefit paym ents to participants:(700,529) (336,144) S hare of investment earnings (net of expenses):269,421 97,776 A sset fair m arket value at June 30, 2012 16,322,208 6,032,342 E mployer contribution receivable:- - E mployee contribution receivable:- - A sset fair m arket value at June 30, 2012 16,322,208 6,032,342 Approximate annual rate of return for the plan year (net of expenses): 1.66% CITY OF SOUTH BURLINGTON, VERMONT NOTES TO FINANCIAL STATEMENTS JUNE 30, 2012 50 NOTE 12 - DEFINED BENEFIT PENSION PLAN (CONTINUED) Significant actuarial assumptions used to compute the pension benefit obligations and the actuarial present value of accumulated plan benefits are as follows: Current actuarial valuation date July 1, 2012 Actuarial present value interest rate 7.50% Projected salary increase: 4.00% Employee contribution rate (Public Safety Only) 6.50% Actuarial cost method Frozen initial liability cost method Mortality table used in determining actuarial present values IRC Section 430-2009 Optional Combined Table NOTE 13 - DEFERRED COMPENSATION PLAN The City offers its employees a deferred compensation plan created in accordance with Internal Revenue Code Section 457. The plan, available to all City employees, permits them to defer a portion of their salary until future years. The deferred compensation is not available to employees until termination, retirement, death or unforeseen 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 (until paid or made available to the employee or other beneficiary) to be held in a trust for the exclusive benefit of the participants and their beneficiaries. It is the opinion of the City’s management that the City has no liability for losses under the plan but does have the duty of due care that would be required of an ordinary prudent investor. CITY OF SOUTH BURLINGTON, VERMONT NOTES TO FINANCIAL STATEMENTS JUNE 30, 2012 51 NOTE 14 - DEFICIT FUND BALANCES At June 30, 2012 the City had the following deficit fund balances / net assets: N on-m ajor funds: M P G 10 N atural R esources (210)3,510$ M P G FY 08 G rowth C enter (219)515 M obile data term inals (245)2,616 M arket street federal (280)3,375 K ennedy drive reconstruction (303)9,754 E xit 14B S taples 3rd lane (318)130,017 H ayes ave. storm w ater (328)4,325 Fire departm ent donations 811 Total non-m ajor funds 154,923$ The City is currently reviewing the condition of these overdrafts and a plan to fund them. NOTE 15 - CONTINGENCIES With regard to pending legal claims or any unasserted claims, it is not feasible at this time to predict or determine their outcome. Management believes, however, that settlement amounts, if any, will not have a material adverse effect on the City’s financial position. The City participates in various intergovernmental grant programs which may be subject to future program compliance audits by the grantors or their representatives. Accordingly, the City’s compliance with applicable grant requirement may be established at some future date. The amount, if any, of any liabilities arising from the disallowance of expenditures or ineligibility of grant revenues cannot be determined at this time. NOTE 16 - OPERATING LEASE On June 25, 2007, the City of South Burlington, Vermont entered into a lease agreement with Delage Landen for the lease of a copier. The total amount due is $9,025.80, to be paid in monthly installment of $150.43 over 5 years. The following is a schedule of future minimum lease payments under this lease. During the year ended June 30, 2012 $1,806 CITY OF SOUTH BURLINGTON, VERMONT NOTES TO FINANCIAL STATEMENTS JUNE 30, 2012 52 NOTE 17 - LESSOR LEASE Commencing May 1, 2005, the National Gardening Association (NGA) has entered into an agreement with the City for the lease of a building and a portion of the City’s property located on Dorset Street. The lease is for 20 years with an option to extend an additional 20 years. The NGA agrees to pay the City $1 per year. NOTE 18 - COMMITMENTS The City of South Burlington, Vermont contracts for management, water purchases and other services from the Champlain Water District (CWD). The water department has contracted with CWD to manage and maintain the water facility. This contract is renewed annually. The terms of the management contract provide for hourly wages for the CWD employees. 53 Required Supplementary Information Required supplementary information includes financial information and disclosures that are required by the Government Accounting Standards Board but are not considered a part of the basic financial statements. Such information includes: ● Budgetary Comparison Schedule - Budgetary Basis - Budget and Actual - General Fund ● Budgetary Comparison Schedule - Budgetary Basis - Budget and Actual - General Fund Revenues SCHEDULE 1 CITY OF SOUTH BURLINGTON, VERMONT BUDGETARY COMPARISON SCHEDULE – BUDGETARY BASIS BUDGET AND ACTUAL – GENERAL FUND FOR THE YEAR ENDED JUNE 30, 2012 54 Variance Actual Positive O riginal Final Am ounts (N egative) Budgetary Fund Balance, July 1 1,639,610$ 1,639,610$ 1,639,610$ -$ R esources (Inflow s): G eneral tax revenue - m unicipal and education 45,500,012 45,500,012 45,614,174 114,162 Intergovernm ental revenue 89,590 89,590 49,821 (39,769) C harges for services 3,044,005 3,044,005 3,488,866 444,861 Investm ent incom e 76,189 76,189 106,838 30,649 O ther revenue - - - - Transfers from other funds 8,500 8,500 5,470,350 5,461,850 Am ounts A vailable for Appropriation 50,357,906 50,357,906 56,369,659 6,011,753 C harges to Appropriations (O utflow s): G eneral governm ent 2,482,723 2,482,723 3,131,702 (648,979) Public safety 9,180,133 9,180,133 8,103,701 1,076,432 Public w orks 2,429,110 2,429,110 2,503,255 (74,145) Social services 567,955 567,955 562,711 5,244 R ecreation and culture 1,189,281 1,189,281 1,094,136 95,145 D ebt service 1,125,650 1,125,650 1,786,764 (661,114) Education 31,297,744 31,297,744 31,297,744 - Transfers to other funds 695,700 695,700 5,901,476 (5,205,776) Total C harges to Appropriations 48,968,296 48,968,296 54,381,489 (5,413,193) Budgetary Fund Balance, June 30 1,389,610$ 1,389,610$ 1,988,170$ 598,560$ U tilization of unassigned fund balance 250,000$ 250,000$ -$ (250,000)$ U tilization of assigned fund balance - - - - 250,000$ 250,000$ -$ (250,000)$ See accom panying independent auditors' report. Budgeted Am ounts SCHEDULE 2 CITY OF SOUTH BURLINGTON, VERMONT BUDGETARY COMPARISON SCHEDULE – BUDGETARY BASIS BUDGET AND ACTUAL – GENERAL FUND REVENUES FOR THE YEAR ENDED JUNE 30, 2012 55 Variance O riginal Final Actual Positive B udget B udget (Negative) R EVENU ES G eneral tax revenues: Property taxes 10,501,268$ 10,501,268$ 10,641,540$ 140,272$ Property taxes (education)31,297,744 31,297,744 31,297,744 - Local options tax 3,220,000 3,220,000 3,446,252 226,252 Interest and penalties 481,000 481,000 228,638 (252,362) Intergovernm ental revenues: Fire safer grant 75,990 75,990 37,995 (37,995) Pager grant 13,600 13,600 11,826 (1,774) C harges for services: Adm inistrative services 315,976 315,976 734,319 418,343 Fire departm ent 88,980 88,980 103,029 14,049 O ther Tow n C lerk fees 217,350 217,350 220,572 3,222 Building & sign perm its 167,100 167,100 276,175 109,075 O ther planning fees 80,487 80,487 94,331 13,844 Verm ont district court 120,000 120,000 107,185 (12,815) Police departm ent 120,500 120,500 129,414 8,914 H ighw ay departm ent 892,861 892,861 961,912 69,051 R ecreation 19,476 19,476 19,419 (57) Facilities 500 500 480 (20) Park m aintenance 300 300 - (300) Special activities 105,350 105,350 156,301 50,951 Am bulance 904,815 904,815 674,201 (230,614) Library 10,310 10,310 11,528 1,218 Investm ent incom e 76,189 76,189 106,838 30,649 O ther incom e Transfers from other funds: Poice bequeath fund - - 15,000 15,000 Blanchette library 8,500 8,500 8,500 - R oad opening im pact fees 92,568 92,568 M PG FY 08 grow th center - - 2,000 2,000 W rite-offs - - 5,352,282 5,352,282 U se of unassigned 250,000 250,000 - (250,000) Total revenues 48,968,296$ 48,968,296$ 54,730,049$ 5,761,753$ See accom panying independent auditors' report. Other Supplementary Information 56 Other supplementary information includes financial statements and schedules not required by the Government Accounting Standards Board, nor a part of the basic financial statements, but are presented for purposes of additional analysis. ● Schedule of Departmental Operations ● Combining Balance Sheet - Nonmajor Governmental Funds ● Combining Schedule of Revenues, Expenditures and Changes in Fund Balances - Nonmajor Governmental Funds ● Combining Balance Sheet - Nonmajor Special Revenue Funds ● Combining Schedule of Revenues, Expenditures and Changes in Fund Balances - Nonmajor Special Revenue Funds ● Combining Balance Sheet – Nonmajor Capital Projects Funds ● Combining Schedule of Revenues, Expenditures and Changes in Fund Balances – Nonmajor Capital Project Funds ● Combining Balance Sheet – Nonmajor Permanent Funds ● Combining Schedule of Revenues, Expenditures and Changes in Fund Balances – Nonmajor Permanent Funds ● Schedule of General Capital Assets by Function ● Schedule of Changes in General Capital Assets by Function SCHEDULE A CITY OF SOUTH BURLINGTON, VERMONT SCHEDULE OF DEPARTMENTAL OPERATIONS FOR THE YEAR ENDED JUNE 30, 2012 57 O rigin al B u dg et F in al B alan ce B ud get A djus tm en ts B ud get A ctual P o sitive (Ne ga tive ) G en e ra l g o vern m e n t: C ity co un cil 117 ,2 03$ -$ 11 7,203$ 1 14,9 34$ 2,26 9$ A dm inistra tive insu ra nce 555 ,0 31 - 55 5,031 9 97,1 81 (4 42,15 0) C ity m an age r 385 ,5 47 - 38 5,547 4 05,7 77 (20,23 0) C ity clerk 189 ,0 12 - 18 9,012 1 90,9 04 (1,89 2) Le gal/acc oun ting /actua ry 192 ,0 00 - 19 2,000 3 26,2 68 (1 34,26 8) A dm inistra tive se rv ice s 559 ,5 00 - 55 9,500 6 58,2 65 (98,76 5) G en era l ledg er/p ayroll 69 ,7 15 - 6 9,715 68,9 49 76 6 A ss ess in g/ta x 162 ,3 86 - 16 2,386 1 24,1 61 38,22 5 P lann in g/de sign re view 249 ,4 29 - 24 9,429 2 44,0 66 5,36 3 N atural reso urces 2 ,9 00 - 2,900 1,1 97 1,70 3 2,482 ,7 23 - 2,48 2,723 3 ,1 31,7 02 (6 48,97 9) P u b lic safety: F ire de pa rtm e nt 2,741 ,4 19 - 2,74 1,419 2 ,5 27,4 83 2 13,93 6 A m bu la nce 1,155 ,0 64 - 1,15 5,064 1 ,1 18,8 03 36,26 1 P olice de pa rtm e nt 5,283 ,6 50 - 5,28 3,650 4 ,4 57,4 15 8 26,23 5 9,180 ,1 33 - 9,18 0,133 8 ,1 03,7 01 1 ,0 76,43 2 P u b lic w o rk s: H ig hw ay d ep artm ent 2,429 ,1 10 - 2,42 9,110 2 ,5 03,2 55 (74,14 5) 2,429 ,1 10 - 2,42 9,110 2 ,5 03,2 55 (74,14 5) S o c ial se rvices: C ou nty cou rt 103 ,0 44 - 10 3,044 97,8 93 5,15 1 W in oos ki V a lley P a rk 54 ,0 00 - 5 4,000 54,0 00 - C .C.T .A 375 ,5 94 - 37 5,594 3 75,3 44 25 0 R eg io nal plann in g 18 ,1 65 - 1 8,165 18,3 22 (15 7) M e trop olitan p la nning 17 ,1 52 - 1 7,152 17,1 52 - 567 ,9 55 - 56 7,955 5 62,7 11 5,24 4 SCHEDULE A (CONTINUED) CITY OF SOUTH BURLINGTON, VERMONT SCHEDULE OF DEPARTMENTAL OPERATIONS FOR THE YEAR ENDED JUNE 30, 2012 58 O rigin al B u dg et F in al B alan ce s B ud get A djus tm en ts B ud get A ctual P ositiv e (N eg ativ e) R ec rea tio n a n d cu ltu re : R ec rea to n ad m inistra tion 261 ,7 20 - 26 1,720 2 54,3 79 7,341 P rogram s 33 ,8 38 - 3 3,838 16,4 19 1 7,419 R ed R o cks pa rk 13 ,8 00 - 1 3,800 15,0 00 (1,200 ) F ac ilities 29 ,3 48 - 2 9,348 30,1 68 (820 ) Le is ure a rts 16 ,6 52 - 1 6,652 17,3 73 (721 ) C on tracted p ro gra m s 51 ,2 36 - 5 1,236 71,1 62 (1 9,926 ) G re at e sca pe 15 ,0 00 - 1 5,000 18,5 11 (3,511 ) S pe cial a ctiv ities 13 ,6 86 - 1 3,686 16,1 79 (2,493 ) S kiing prog ram s 9 ,8 00 - 9,800 12,1 20 (2,320 ) C om m unity library 403 ,9 91 - 40 3,991 3 68,1 01 3 5,890 P ark m aintena nce 340 ,2 10 - 34 0,210 2 74,7 24 6 5,486 1,189 ,2 81 - 1,18 9,281 1 ,0 94,1 36 9 5,145 D eb t se rvice: P rin cip al p ub lic w ork s facility 98 ,5 00 - 9 8,500 98,5 68 (68 ) P rin cip al K enn edy d rive reco n.22 ,4 40 - 2 2,440 22,5 08 (68 ) P rin cip al L im e K iln bridg e 22 ,4 40 - 2 2,440 22,5 08 (68 ) P rin icp al F /D bu ilding im p ro vem en ts 30 ,0 90 - 3 0,090 30,0 05 85 P rin icp al e m erg enc y cen te r 130 ,0 00 - 13 0,000 1 30,0 00 - P rin cip al p olic e he adq uarte rs 360 ,0 00 - 36 0,000 3 60,0 00 - P rin cip al P ark la nd, 19 92 35 ,0 00 - 3 5,000 35,0 00 - P rin cip al P ark la nd/B rand farm 40 ,0 00 - 4 0,000 40,0 00 - P rin cip al p en sio n liab ilitiy - - - 2 62,9 74 (26 2,974 ) P rin cip al s to rm w ater - - - - - In te res t p ublic w o rks fa cility 50 ,7 83 - 5 0,783 50,8 25 (42 ) In te res t K e nne dy d rive re con .13 ,9 30 - 1 3,930 13,9 68 (38 ) In te res t L im e K iln b ridge 13 ,9 30 - 1 3,930 13,9 68 (38 ) In te res t F /E bu ilding im p ro vem en ts 18 ,6 80 - 1 8,680 18,6 21 59 In te res t e m e rge ncy c ente r 11 ,6 54 - 1 1,654 11,6 54 - In te res t p olice h ea dqu arte rs 269 ,0 82 - 26 9,082 2 69,0 82 - In te res t P a rklan d, 199 2 4 ,5 71 - 4,571 3,4 43 1,128 In te res t P a rklan d/B ra nd fa rm 4 ,5 50 - 4,550 5,6 66 (1,116 ) In te res t p ens io n liab ility - - - 3 97,9 74 (39 7,974 ) 1,125 ,6 50 - 1,12 5,650 1 ,7 86,7 64 (26 3,140 ) SCHEDULE A (CONTINUED) CITY OF SOUTH BURLINGTON, VERMONT SCHEDULE OF DEPARTMENTAL OPERATIONS FOR THE YEAR ENDED JUNE 30, 2012 59 O riginal Budget Final Balances B udget Adjustm ents Budget Actual Positive (N egative) Education 31,297,744 - 31,297,744 31,297,744 - Transfers: O pen space 273,000 - 273,000 273,000 - Interim zoning 75,000 - 75,000 75,000 - Fuel pum p reserve 8,200 - 8,200 8,200 - Am bulance services 155,000 - 155,000 - 155,000 EM TP training 10,000 - 10,000 10,000 - Fire departm ent building im pr.40,000 - 40,000 40,000 - Fire departm ent fund 64,000 - 64,000 64,000 - R eappraisal 70,500 - 70,500 70,500 - W rite-offs - - - 5,360,776 (5,360,776) 695,700 - 695,700 5,901,476 (5,205,776) Total Expenditures 48,968,296$ -$ 48,968,296$ 54,381,489$ (5,015,219)$ See accom panying independent auditors' report. SCHEDULE B CITY OF SOUTH BURLINGTON, VERMONT COMBINING BALANCE SHEET – NONMAJOR GOVERNMENTAL FUNDS JUNE 30, 2012 60 Special C apital Total N onm ajor R evenue Project P erm anent G overnm ental Funds Funds Funds Funds ASSETS C ash and cash equivalents 553,712$ -$ -$ 553,712$ Investm ents - - 368,393 368,393 D ue from agencies - - 75 75 D ue from other funds 1,433,270 1,389,505 111,979 2,934,754 TO TAL ASSETS 1,986,982$ 1,389,505$ 480,447$ 3,856,934$ LIABILITIES Accounts payable 18,452$ -$ -$ 18,452$ D ue to agencies - - 6,188 6,188 D ue to other governm ents - 2,428 - 2,428 D ue to other funds 56,957 144,096 1,045 202,098 TO TAL LIABILITIES 75,409 146,524 7,233 229,166 FU N D BALAN C ES N onspendable - - - - R estricted 358,477 249,153 467,933 1,075,563 C om m itted 1,468,032 1,137,924 6,092 2,612,048 Assigned 95,080 - - 95,080 U nassigned (10,016) (144,096) (811) (154,923) TO TAL FU N D BALAN C ES 1,911,573 1,242,981 473,214 3,627,768 TO TAL LIABILITIES AN D FU N D BALAN C ES 1,986,982$ 1,389,505$ 480,447$ 3,856,934$ See accom panying independent auditors' report. SCHEDULE C CITY OF SOUTH BURLINGTON, VERMONT COMBINING SCHEDULE OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCES – NONMAJOR GOVERNMENTAL FUNDS FOR THE YEAR ENDED JUNE 30, 2012 61 S pecial C apital Total N onm ajor R evenue Project Perm anent G overnm ental Funds Funds Funds Funds R EVEN U ES Intergovernm ental revenue 218,368$ 933,873$ -$ 1,152,241$ C harges for service 1,308,425 - 2,000 1,310,425 O ther incom e 79,202 80,774 77,163 237,139 Investm ent incom e - - 8,500 8,500 TO TAL R EVEN U ES 1,605,995 1,014,647 87,663 2,708,305 EXPEN D ITU R ES Adm inistration 169,050 - - 169,050 Public safety 5,449 - 1,246 6,695 C apital outlay 358,565 859,577 - 1,218,142 O ther - - 16,102 16,102 TO TAL EXPEN D ITU R ES 623,296 859,577 17,348 1,500,221 EXC ESS O F R EVEN U ES O VER (U N D ER ) EXPEN D ITU R ES 982,699 155,070 70,315 1,208,084 O TH ER FIN AN C IN G SO U R C ES (U SES) O perating Transfers In 612,907 1,436,379 1,486 2,050,772 O perating Transfers (O ut)(4,913,466) (699,472) (8,509) (5,621,447) TO TAL O TH ER FIN A NC IN G SO U R C ES (U SES)(4,300,559) 736,907 (7,023) (3,570,675) EXC ESS O F R EVEN U ES AN D O TH ER SO U R C ES O VER (U N DE R) EXPEN D ITU R ES AN D O TH ER (U SES)(3,317,860) 891,977 63,292 (2,362,591) FU N D BALAN C ES, JU LY 1 5,229,433 351,004 409,922 5,990,359 FU N D BALAN C ES, JU N E 30 1,911,573$ 1,242,981$ 473,214$ 3,627,768$ See accom panying independent auditors' report. 62 Special Revenue Funds Special revenue funds are established to account for the proceeds of specific revenue sources (other than expendable trusts or for major capital projects) that are legally restricted to expenditures for specific purposes. SCHEDULE D CITY OF SOUTH BURLINGTON, VERMONT COMBINING BALANCE SHEET - NONMAJOR SPECIAL REVENUE FUNDS JUNE 30, 2012 63 269 203 204 206 207 MPO /Traffic Fire Sew er 205 Police Police O verlay Im pact Im pact Project O ff-D uty Forfeiture G rant Fees Fees D are W ork Fund ASSETS C ash and cash equivalents -$ -$ -$ -$ -$ -$ D ue from other funds 4,163 161,479 - 809 - 45,649 TO TAL ASSETS 4,163$ 161,479$ -$ 809$ -$ 45,649$ LIABILITIES AN D FU N D BALAN C ES LIABILITIES Accounts payable -$ -$ -$ -$ -$ D ue to other funds - - - - - - TO TAL LIABILITIES - - - - - - FU N D BALAN C ES N onspendable - - - - - - R estricted 4,163 - - 809 - 45,649 C om m itted - 161,479 - - - - Assigned - - - - - - U nassigned - - - - - - TO TAL FU N D BALAN C ES 4,163 161,479 - 809 - 45,649 TO TAL LIABILITIES AN D FU N D BALAN C ES 4,163$ 161,479$ -$ 809$ -$ 45,649$ SCHEDULE D (CONTINUED) CITY OF SOUTH BURLINGTON, VERMONT COMBINING BALANCE SHEET - NONMAJOR SPECIAL REVENUE FUNDS JUNE 30, 2012 64 210 215 218 M PG 10 211 212 213 214 Fire D ept.216 W illiston N atural EM TP Fueling Bianchi Interim O ff-D uty C lerk R oad S/W R esources Training Station R uling Zoning W ork C om puterization Study ASSETS C ash and cash equivalents -$ -$ -$ -$ -$ -$ -$ -$ D ue from other funds - 10,000 8,200 - 75,000 - 129,645 - TO TAL ASSETS -$ 10,000$ 8,200$ -$ 75,000$ -$ 129,645$ -$ LIABILITIES AN D FU N D BALAN C ES LIABILITIES Accounts payable -$ -$ -$ -$ -$ -$ -$ -$ D ue to other funds 3,510 - - - - - - - TO TAL LIABILITIES 3,510 - - - - - - - FU N D BALAN C ES N onspendable - - - - - - - - R estricted - 10,000 8,200 - 75,000 - - - C om m itted - - - - - - 129,645 - Assigned - - - - - - - - U nassigned (3,510) - - - - - - - TO TAL FU N D BALAN C ES (3,510) 10,000 8,200 - 75,000 - 129,645 - TO TAL LIABILITIES AN D FU N D BALAN C ES -$ 10,000$ 8,200$ -$ 75,000$ -$ 129,645$ -$ SCHEDULE D (CONTINUED) CITY OF SOUTH BURLINGTON, VERMONT COMBINING BALANCE SHEET - NONMAJOR SPECIAL REVENUE FUNDS JUNE 30, 2012 65 219 220 221 222 223 224 225 MPG FY 08 R ecreation H ighw ay School AR EH S/W Special G row th Im pact Im pact Im pact Bike Path D isconnection N eeds C enter Fees Fees Fees R epaving Program Assessm ent ASSETS C ash and cash equivalents -$ -$ 478,712$ -$ -$ -$ -$ D ue from other funds 17,937 358,086 307,351 - - - - TO TAL ASSETS 17,937$ 358,086$ 786,063$ -$ -$ -$ -$ LIABILITIES AN D FU N D BALAN C ES LIABILITIES Accounts payable 18,452$ -$ -$ -$ -$ -$ -$ D ue to other funds - - - - - - - TO TAL LIABILITIES 18,452 - - - - - - FU N D BALAN C ES N onspendable - - - - - - - R estricted - - - - - - - C om m itted - 358,086 786,063 - - - - Assigned - - - - - - - U nassigned (515) - - - - - - TO TAL FU N D BALAN C ES (515) 358,086 786,063 - - - - TO TAL LIABILITIES AN D FU N D BALAN C ES 17,937$ 358,086$ 786,063$ -$ -$ -$ -$ SCHEDULE D (CONTINUED) CITY OF SOUTH BURLINGTON, VERMONT COMBINING BALANCE SHEET - NONMAJOR SPECIAL REVENUE FUNDS JUNE 30, 2012 66 289 230 Better 227 228 611 D orset R oads R ecords R eparative Senior Street H2O G rant Preservation Board C itizens Miltot ASSETS C ash and cash equivalents -$ -$ -$ -$ -$ D ue from other funds - 94,771 1,633 309 24,682 TO TAL ASSETS -$ 94,771$ 1,633$ 309$ 24,682$ LIABILITIES AN D FU N D BALAN C ES LIABILITIES Accounts payable -$ -$ -$ -$ -$ D ue to other funds - - - - - TO TAL LIABILITIES - - - - - FU N D BALAN C ES N onspendable - - - - - R estricted - - - - 24,682 C om m itted - - 1,633 - - Assigned - 94,771 - 309 - U nassigned - - - - - TO TAL FU N D BALAN C ES - 94,771 1,633 309 24,682 TO TAL LIABILITIES AN D FU N D BALAN C ES -$ 94,771$ 1,633$ 309$ 24,682$ SCHEDULE D (CONTINUED) CITY OF SOUTH BURLINGTON, VERMONT COMBINING BALANCE SHEET - NONMAJOR SPECIAL REVENUE FUNDS JUNE 30, 2012 67 234 235 237 296 242 R oad FEMA C ity Center -Potash H ealthy O pening M im ic Potash Brook H om es Im pact Fees G rant R estoration C ulvert G rant ASSETS C ash and cash equivalents -$ -$ -$ -$ -$ D ue from other funds - 69,482 - - - TO TAL ASSETS -$ 69,482$ -$ -$ -$ LIABILITIES AN D FU N D BALAN C ES LIABILITIES Accounts payable -$ -$ -$ -$ -$ D ue to other funds - - - - - TO TAL LIABILITIES - - - - - FU N D BALAN C ES N onspendable - - - - - R estricted - 69,482 - - - C om m itted - - - - - Assigned - - - - - U nassigned - - - - - TO TAL FU N D BALAN C ES - 69,482 - - - TO TAL LIABILITIES AN D FU N D BALAN C ES -$ 69,482$ -$ -$ -$ SCHEDULE D (CONTINUED) CITY OF SOUTH BURLINGTON, VERMONT COMBINING BALANCE SHEET - NONMAJOR SPECIAL REVENUE FUNDS JUNE 30, 2012 68 243 244 245 246 248 South Public Art M obile Butler M PG - Village C ity D ata Farm s C ity C enter R ec. Im pact Center Term inals S/W Pond D esign ASSETS C ash and cash equivalents -$ -$ -$ -$ -$ D ue from other funds 34,089 - - - - TO TAL ASSETS 34,089$ -$ -$ -$ -$ LIABILITIES AN D FU N D BALAN C ES LIABILITIES Accounts payable -$ -$ -$ -$ -$ D ue to other funds - - 2,616 - TO TAL LIABILITIES - - 2,616 - - FU N D BALAN C ES N onspendable - - - - - R estricted 34,089 - - - - C om m itted - - - - - Assigned - - - - - U nassigned - - (2,616) - - TO TAL FU N D BALAN C ES 34,089 - (2,616) - - TO TAL LIABILITIES AN D FU N D BALAN C ES 34,089$ -$ -$ -$ -$ SCHEDULE D (CONTINUED) CITY OF SOUTH BURLINGTON, VERMONT COMBINING BALANCE SHEET - NONMAJOR SPECIAL REVENUE FUNDS JUNE 30, 2012 69 620 251 252 254 255 Police Fields U se Storm Freem an S/W Bequeath Im pact W ater Foundation M onitoring Fund Fees U tilities G rant Equipm ent ASSETS C ash and cash equivalents 75,000$ -$ -$ -$ -$ D ue from other funds - 1,987 - - - TO TAL ASSETS 75,000$ 1,987$ -$ -$ -$ LIABILITIES AN D FU N D BALAN C ES LIABILITIES Accounts payable -$ -$ -$ -$ -$ D ue to other funds 47,456 - - - - TO TAL LIABILITIES 47,456 - - - - FU N D BALAN C ES N onspendable - - - - - R estricted 27,544 - - - - C om m itted - 1,987 - - - Assigned - - - - - U nassigned - - - - - TO TAL FU N D BALAN C ES 27,544 1,987 - - - TO TAL LIABILITIES AN D FU N D BALAN C ES 75,000$ 1,987$ -$ -$ -$ SCHEDULE D (CONTINUED) CITY OF SOUTH BURLINGTON, VERMONT COMBINING BALANCE SHEET - NONMAJOR SPECIAL REVENUE FUNDS JUNE 30, 2012 70 261 262 264 265 267 CL Jew ish C /L Arts Tree Fire Act 270 S pecific W riters C ouncil M aintenance/G rant H om eland O utlays G rant G rant R eplacem ent (FEMA)Security ASSETS C ash and cash equivalents -$ -$ -$ -$ -$ -$ D ue from other funds 3,484 - - 20,555 - - TO TAL ASSETS 3,484$ -$ -$ 20,555$ -$ -$ LIABILITIES AN D FU N D BALAN C ES LIABILITIES Accounts payable -$ -$ -$ -$ -$ -$ D ue to other funds - - - - - - TO TAL LIABILITIES - - - - - - FU N D BALAN C ES N onspendable - - - - - - R estricted - - - - - - C om m itted 3,484 - - 20,555 - - Assigned - - - - - - U nassigned - - - - - - TO TAL FU N D BALAN C ES 3,484 - - 20,555 - - TO TAL LIABILITIES AN D FU N D BALAN C ES 3,484$ -$ -$ 20,555$ -$ -$ SCHEDULE D (CONTINUED) CITY OF SOUTH BURLINGTON, VERMONT COMBINING BALANCE SHEET - NONMAJOR SPECIAL REVENUE FUNDS JUNE 30, 2012 71 273 271 272 EP A 274 275 G reat Youth D em onstration Skiing Transportation Escape B aseball G rant Program Action ASSETS C ash and cash equivalents -$ -$ -$ -$ -$ D ue from other funds - - - - 20 TO TAL ASSETS -$ -$ -$ -$ 20$ LIABILITIES AN D FU N D BALAN C ES LIABILITIES Accounts payable -$ -$ -$ -$ -$ D ue to other funds - - - - - TO TAL LIABILITIES - - - - - FU N D BALAN C ES N onspendable - - - - - R estricted - - - - 20 C om m itted - - - - - Assigned - - - - - U nassigned - - - - - TO TAL FU N D BALAN C ES - - - - 20 TO TAL LIABILITIES AN D FU N D BALAN C ES -$ -$ -$ -$ 20$ SCHEDULE D (CONTINUED) CITY OF SOUTH BURLINGTON, VERMONT COMBINING BALANCE SHEET - NONMAJOR SPECIAL REVENUE FUNDS JUNE 30, 2012 72 277 278 280 283 284 Stag BYFAE Market LED H om eland EPA Jag Street Signage/Security G rant G rant (Federal)C rossw alks Tech. R escue ASSETS C ash and cash equivalents -$ -$ -$ -$ -$ D ue from other funds 6,244 - - 28,147 - TO TAL ASSETS 6,244$ -$ -$ 28,147$ -$ LIABILITIES AN D FU N D BALAN C ES LIABILITIES Accounts payable -$ -$ -$ -$ -$ D ue to other funds - - 3,375 - - TO TAL LIABILITIES - - 3,375 - - FU N D BALAN C ES N onspendable - - - - - R estricted 6,244 - - 28,147 - C om m itted - - - - - Assigned - - - - - U nassigned - - (3,375) - - TO TAL FU N D BALAN C ES 6,244 - (3,375) 28,147 - TO TAL LIABILITIES AN D FU N D BALAN C ES 6,244$ -$ -$ 28,147$ -$ SCHEDULE D (CONTINUED) CITY OF SOUTH BURLINGTON, VERMONT COMBINING BALANCE SHEET - NONMAJOR SPECIAL REVENUE FUNDS JUNE 30, 2012 73 286 287 288 290 293 San R em o C /L A/P H ighw ay Fire D rive Sum m er A/G uard S afety Act Project Program Environm ental G rant 2004 ASSETS C ash and cash equivalents -$ -$ -$ -$ -$ D ue from other funds 512 100 15,964 7,972 - TO TAL ASSETS 512$ 100$ 15,964$ 7,972$ -$ LIABILITIES AN D FU N D BALAN C ES LIABILITIES Accounts payable -$ -$ -$ -$ -$ D ue to other funds - - - - - TO TAL LIABILITIES - - - - - FU N D BALAN C ES N onspendable - - - - - R estricted 512 - 15,964 7,972 - C om m itted - 100 - - - Assigned - - - - - U nassigned - - - - - TO TAL FU N D BALAN C ES 512 100 15,964 7,972 - TO TAL LIABILITIES AN D FU N D BALAN C ES 512$ 100$ 15,964$ 7,972$ -$ SCHEDULE D (CONTINUED) CITY OF SOUTH BURLINGTON, VERMONT COMBINING BALANCE SHEET - NONMAJOR SPECIAL REVENUE FUNDS JUNE 30, 2012 74 298 299 Local O ptions/Fire D ept.615 617 R oom s/M eals S afer C om m unity C anine Tax G rant D evelopm ent U nit Totals ASSETS C ash and cash equivalents -$ -$ -$ -$ 553,712$ D ue from other funds - - - 5,000 1,433,270 TO TAL ASSETS -$ -$ -$ 5,000$ 1,986,982$ LIABILITIES AN D FU N D BALAN C ES LIABILITIES Accounts payable -$ -$ -$ -$ 18,452$ D ue to other funds - - - - 56,957 TO TAL LIABILITIES - - - - 75,409 FU N D BALAN C ES N onspendable - - - - - R estricted - - - - 358,477 C om m itted - - - 5,000 1,468,032 Assigned - - - - 95,080 U nassigned - - - - (10,016) TO TAL FU N D BALAN C ES - - - 5,000 1,911,573 TO TAL LIABILITIES AN D FU N D BALAN C ES -$ -$ -$ 5,000$ 1,986,982$ See accom panying independent auditors' report. SCHEDULE E CITY OF SOUTH BURLINGTON, VERMONT COMBINING SCHEDULE OF REVENUES, EXPENDITURES, AND CHANGES IN FUND BALANCES NONMAJOR SPECIAL REVENUE FUNDS FOR THE YEAR ENDED JUNE 30, 2012 75 269 203 204 206 207 MPO /Traffic Fire Sew er 205 Police Police O verlay Im pact Im pact Project O ff-D uty Forfeiture G rant Fees Fees D are W ork Fund R EVEN U ES Intergovernm ental revenue -$ -$ -$ -$ -$ -$ C harges for service - 43,027 361,704 - - 28,181 O ther incom e - - - 809 - - TO TAL R EVEN U ES - 43,027 361,704 809 - 28,181 EXPEN D ITU R ES Adm inistration - - - - - - Public safety - - - - - 5,449 Education - - - - - - C apital outlay - - - - - - TO TAL EXPEN D ITU R ES - - - - - 5,449 EXC ESS O F R EVEN U ES O VER (U N D ER ) EXPEN D ITU R ES - 43,027 361,704 809 - 22,732 O TH ER FIN AN C IN G SO U R C ES (U SES) O perating Transfers In - - - - - - O perating Transfers (O ut)- - (2,170,910) (2,896) (12,774) (90,000) TO TAL O TH ER FIN A NC IN G SO U R C ES (U SES)- - (2,170,910) (2,896) (12,774) (90,000) EXC ESS O F R EVEN U ES AN D O TH ER SO U R C ES O VER (U N D ER ) EXPEN D ITU R ES AN D O TH ER (U SES)- 43,027 (1,809,206) (2,087) (12,774) (67,268) FU N D BALAN C ES, JU LY 1 4,163 118,452 1,809,206 2,896 12,774 112,917 FU N D BALAN C ES, JU N E 30 4,163$ 161,479$ -$ 809$ -$ 45,649$ SCHEDULE E (CONTINUED) CITY OF SOUTH BURLINGTON, VERMONT COMBINING SCHEDULE OF REVENUES, EXPENDITURES, AND CHANGES IN FUND BALANCES NONMAJOR SPECIAL REVENUE FUNDS FOR THE YEAR ENDED JUNE 30, 2012 76 210 215 218 MPG 10 211 212 213 214 Fire D ept.216 W illiston N atural EM TP Fueling Bianchi Interim O ff-D uty C lerk R oad S/W R esources Training Station R uling Zoning W ork C om puterization Study R EVEN U ES Intergovernm ental revenue -$ -$ -$ -$ -$ -$ -$ 1,403$ C harges for service 664 - - - - - - - O ther incom e - - - - - - 78,393 - TO TAL R EVEN U ES 664 - - - - - 78,393 1,403 EXPEN D ITU R ES Adm inistration - - - - - - 32,188 - Public safety - - - - - - - - Education - - - - - - - - C apital outlay 7,684 - - - - - - - TO TAL EXPEN D ITU R ES 7,684 - - - - - 32,188 - EXC ESS O F R EVEN U ES O VER (U N D ER ) EXPEN D ITU R ES (7,020) - - - - - 46,205 1,403 O TH ER FIN AN C IN G SO U R C ES (U SES) O perating Transfers In - 10,000 8,200 - 75,000 1,637 - - O perating Transfers (O ut)- - - (46,861) - - - (8,235) TO TAL O TH ER FIN A NC IN G SO U R C ES (U SES)- 10,000 8,200 (46,861) 75,000 1,637 - (8,235) EXC ESS O F R EVEN U ES AN D O TH ER SO U R C ES O VER (U N DE R) EX PEN D ITU R ES AN D O TH ER (U SES)(7,020) 10,000 8,200 (46,861) 75,000 1,637 46,205 (6,832) FU N D BALAN C ES, JU LY 1 3,510 - - 46,861 - (1,637) 83,440 6,832 FU N D BALAN C ES, JU N E 30 (3,510)$ 10,000$ 8,200$ -$ 75,000$ -$ 129,645$ -$ SCHEDULE E (CONTINUED) CITY OF SOUTH BURLINGTON, VERMONT COMBINING SCHEDULE OF REVENUES, EXPENDITURES, AND CHANGES IN FUND BALANCES NONMAJOR SPECIAL REVENUE FUNDS FOR THE YEAR ENDED JUNE 30, 2012 77 219 220 221 222 223 224 225 M PG FY 08 R ecreation H ighw ay School AR EH S/W Special G row th Im pact Im pact Im pact B ike Path D isconnection N eeds C enter Fees Fees Fees R epaving Program A ssessm ent R EVEN U ES Intergovernm ental revenue 80,000$ -$ -$ -$ -$ -$ C harges for service - 209,162 291,618 - - - - O ther incom e - - - - - TO TAL R EVEN U ES 80,000 209,162 291,618 - - - - EXPEN D ITU R ES Adm inistration - - - - - - - Public safety - - - - - - - Education - - - 90,232 - - - C apital outlay 96,310 - - - - - TO TAL EXPEN D ITU R ES 96,310 - - 90,232 - - - EXC ESS O F R EVEN U ES O VER (U N D ER ) EXPEN D ITU R ES (16,310) 209,162 291,618 (90,232) - - - O TH ER FIN AN C IN G SO U R C ES (U SES) O perating Transfers In - - - - 7,269 2,620 - O perating Transfers (O ut)(2,000) - - - - - (1,204) TO TAL O TH ER FIN A NC IN G SO U R C ES (U SES)(2,000) - - - 7,269 2,620 (1,204) EXC ESS O F R EVEN U ES AN D O TH ER SO U R C ES O VER (U N D ER ) EXPEN D ITU R ES AN D O TH ER (U SES)(18,310) 209,162 291,618 (90,232) 7,269 2,620 (1,204) FU N D BALAN C ES, JU LY 1 17,795 148,924 494,445 90,232 (7,269) (2,620) 1,204 FU N D BALAN C ES, JU N E 30 (515)$ 358,086$ 786,063$ -$ -$ -$ -$ SCHEDULE E (CONTINUED) CITY OF SOUTH BURLINGTON, VERMONT COMBINING SCHEDULE OF REVENUES, EXPENDITURES, AND CHANGES IN FUND BALANCES NONMAJOR SPECIAL REVENUE FUNDS FOR THE YEAR ENDED JUNE 30, 2012 78 289 230 Better 227 228 611 D orset R oads R ecords R eparative S enior S treet H 2O G rant Preservation Board C itizens M ilot R EVEN U ES Intergovernm ental revenue -$ -$ -$ -$ -$ C harges for service - 27,717 - - 3,530 O ther incom e - - - - - TO TAL R EVEN U ES - 27,717 - - 3,530 EXPEN D ITU R ES Adm inistration - 1,327 975 - - Public safety - - - - - Education - - - - - C apital outlay - - - - - TO TAL EXPEN D ITU R ES - 1,327 975 - - EXC ESS O F R EVEN U ES O VER (U N D ER ) EXPEN D ITU R ES - 26,390 (975) - 3,530 O TH ER FIN AN C IN G SO U R C ES (U SES) O perating Transfers In 4,003 - - - - O perating Transfers (O ut)- - - - - TO TAL O TH ER FIN A NC IN G SO U R C ES (U SES)4,003 - - - - EXC ESS O F R EVEN U ES AN D O TH ER SO U R C ES O VER (U N D ER ) EXPEN D ITU R ES AN D O TH ER (U SES)4,003 26,390 (975) - 3,530 FU N D BALAN C ES, JU LY 1 (4,003) 68,381 2,608 309 21,152 FU N D BALAN C ES, JU N E 30 -$ 94,771$ 1,633$ 309$ 24,682$ SCHEDULE E (CONTINUED) CITY OF SOUTH BURLINGTON, VERMONT COMBINING SCHEDULE OF REVENUES, EXPENDITURES, AND CHANGES IN FUND BALANCES NONMAJOR SPECIAL REVENUE FUNDS FOR THE YEAR ENDED JUNE 30, 2012 79 234 235 237 296 242 R oad FEMA C ity C enter -Potash H ealthy O pening M im ic Potash B rook H om es Im pact Fees G rant R estoration C ulvert G rant R EVEN U ES Intergovernm ental revenue -$ -$ -$ 6,900$ -$ C harges for service 93,828 187,825 - - - O ther incom e - - - - - TO TAL R EVEN U ES 93,828 187,825 - 6,900 - EXPEN D ITU R ES Adm inistration - - 57,966 - - Public safety - - - - - Education - - - - - C apital outlay - 97,731 - - - TO TAL EXPEN D ITU R ES - 97,731 57,966 - - EXC ESS O F R EVEN U ES O VER (U N D ER ) EXPEN D ITU R ES 93,828 90,094 (57,966) 6,900 - O TH ER FIN AN C IN G SO U R C ES (U SES) O perating Transfers In - - 57,966 - - O perating Transfers (O ut)(388,479) - (389,055) - (38) TO TAL O TH ER FIN A NC IN G SO U R C ES (U SES)(388,479) - (331,089) - (38) EXC ESS O F R EVEN U ES AN D O TH ER SO U R C ES O VER (U N D ER ) EXPEN D ITU R ES AN D O TH ER (U SES)(294,651) 90,094 (389,055) 6,900 (38) FU N D BALAN C ES, JU LY 1 294,651 (20,612) 389,055 (6,900) 38 FU N D BALAN C ES, JU N E 30 -$ 69,482$ -$ -$ -$ SCHEDULE E (CONTINUED) CITY OF SOUTH BURLINGTON, VERMONT COMBINING SCHEDULE OF REVENUES, EXPENDITURES, AND CHANGES IN FUND BALANCES NONMAJOR SPECIAL REVENUE FUNDS FOR THE YEAR ENDED JUNE 30, 2012 80 243 244 245 246 248 South Public Art Mobile Butler MP G - Village C ity D ata Farm s C ity C enter R ec. Im pact C enter Term inals S/W Pond D esign R EVEN U ES Intergovernm ental revenue -$ -$ 30,886$ -$ 10,500$ C harges for service 10,943 - - - - O ther incom e - - - - - TO TAL R EVEN U ES 10,943 - 30,886 - 10,500 EXPEN D ITU R ES Adm inistration - - - 32,093 - Public safety - - - - - Education - - - - - C apital outlay - - 33,502 - - TO TAL EXPEN D ITU R ES - - 33,502 32,093 - EXC ESS O F R EVEN U ES O VER (U N D ER ) EXPEN D ITU R ES 10,943 - (2,616) (32,093) 10,500 O TH ER FIN AN C IN G SO U R C ES (U SES) O perating Transfers In - 99,404 4,817 32,093 15,615 O perating Transfers (O ut)- - - (82,317) - TO TAL O TH ER FIN A NC IN G SO U R C ES (U SES)- 99,404 4,817 (50,224) 15,615 EXC ESS O F R EVEN U ES AN D O TH ER SO U R C ES O VER (U N D ER ) EXPEN D ITU R ES AN D O TH ER (U SES)10,943 99,404 2,201 (82,317) 26,115 FU N D BALAN C ES, JU LY 1 23,146 (99,404) (4,817) 82,317 (26,115) FU N D BALAN C ES, JU N E 30 34,089$ -$ (2,616)$ -$ -$ SCHEDULE E (CONTINUED) CITY OF SOUTH BURLINGTON, VERMONT COMBINING SCHEDULE OF REVENUES, EXPENDITURES, AND CHANGES IN FUND BALANCES NONMAJOR SPECIAL REVENUE FUNDS FOR THE YEAR ENDED JUNE 30, 2012 81 620 251 252 254 255 Police Fields U se Storm Freem an S/W Bequeath Im pact W ater Foundation M onitoring Fund Fees U tilities G rant Equipm ent R EVEN U ES Intergovernm ental revenue -$ -$ -$ -$ -$ C harges for service - 33,539 - - - O ther incom e - - - - - TO TAL R EVEN U ES - 33,539 - - - EXPEN D ITU R ES Adm inistration 2,456 42,045 - - - Public safety - - - - - Education - - - - - C apital outlay - - - - TO TAL EXPEN D ITU R ES 2,456 42,045 - - - EXC ESS O F R EVEN U ES O VER (U N D ER ) EXPEN D ITU R ES (2,456) (8,506) - - - O TH ER FIN AN C IN G SO U R C ES (U SES) O perating Transfers In - - 70,799 - 1,713 O perating Transfers (O ut)(45,000) - - (1) - TO TAL O TH ER FIN A NC IN G SO U R C ES (U SES)(45,000) - 70,799 (1) 1,713 EXC ESS O F R EVEN U ES AN D O TH ER SO U R C ES O VER (U N D ER ) EXPEN D ITU R ES AN D O TH ER (U SES)(47,456) (8,506) 70,799 (1) 1,713 FU N D BALAN C ES, JU LY 1 75,000 10,493 (70,799) 1 (1,713) FU N D BALAN C ES, JU N E 30 27,544$ 1,987$ -$ -$ -$ SCHEDULE E (CONTINUED) CITY OF SOUTH BURLINGTON, VERMONT COMBINING SCHEDULE OF REVENUES, EXPENDITURES, AND CHANGES IN FUND BALANCES NONMAJOR SPECIAL REVENUE FUNDS FOR THE YEAR ENDED JUNE 30, 2012 82 261 262 264 265 267 C /L Jew ish C /L Arts Tree Fire Act 270 Specific W riters C ouncil M aintenance/G rant H om eland O utlays G rant G rant R eplacem ent (FE MA)Security R EVEN U ES Intergovernm ental revenue -$ -$ -$ -$ -$ -$ C harges for service 723 - - - - - O ther incom e - - - - - - TO TAL R EVEN U ES 723 - - - - - EXPEN D ITU R ES Adm inistration - - - - - Public safety - - - - - - Education - - - - - - C apital outlay 478 - - - - - TO TAL EXPEN D ITU R ES 478 - - - - - EXC ESS O F R EVEN U ES O VER (U N D ER ) EXPEN D ITU R ES 245 - - - - - O TH ER FIN AN C IN G SO U R C ES (U SES) O perating Transfers In - - - - 24,247 3,619 O perating Transfers (O ut)- (123) (155) - - - TO TAL O TH ER FIN A NC IN G SO U R C ES (U SES)- (123) (155) - 24,247 3,619 EXC ESS O F R EVEN U ES AN D O TH ER SO U R C ES O VER (U N D ER ) EXPEN D ITU R ES AN D O TH ER (U SES)245 (123) (155) - 24,247 3,619 FU N D BALAN C ES, JU LY 1 3,239 123 155 20,555 (24,247) (3,619) FU N D BALAN C ES, JU N E 30 3,484$ -$ -$ 20,555$ -$ -$ SCHEDULE E (CONTINUED) CITY OF SOUTH BURLINGTON, VERMONT COMBINING SCHEDULE OF REVENUES, EXPENDITURES, AND CHANGES IN FUND BALANCES NONMAJOR SPECIAL REVENUE FUNDS FOR THE YEAR ENDED JUNE 30, 2012 83 273 271 272 EPA 274 275 G reat Youth D em onstration Skiing Transportation Escape Baseball G rant Program Action R EVEN U ES Intergovernm ental revenue -$ -$ 63,361$ -$ -$ C harges for service - - - - - O ther incom e - - - - - TO TAL R EVEN U ES - - 63,361 - - EXPEN D ITU R ES Adm inistration - - - - - Public safety - - - - - Education - - - - - C apital outlay - - 116,183 - - TO TAL EXPEN D ITU R ES - - 116,183 - - EXC ESS O F R EVEN U ES O VER (U N D ER ) EXPEN D ITU R ES - - (52,822) - - O TH ER FIN AN C IN G SO U R C ES (U SES) O perating Transfers In - 53 52,822 - - O perating Transfers (O ut)(25) - (78,625) (6,514) - TO TAL O TH ER FIN A NC IN G SO U R C ES (U SES)(25) 53 (25,803) (6,514) - EXC ESS O F R EVEN U ES AN D O TH ER SO U R C ES O VER (U N D ER ) EXPEN D ITU R ES AN D O TH ER (U SES)(25) 53 (78,625) (6,514) - FU N D BALAN C ES, JU LY 1 25 (53) 78,625 6,514 20 FU N D BALAN C ES, JU N E 30 -$ -$ -$ -$ 20$ SCHEDULE E (CONTINUED) CITY OF SOUTH BURLINGTON, VERMONT COMBINING SCHEDULE OF REVENUES, EXPENDITURES, AND CHANGES IN FUND BALANCES NONMAJOR SPECIAL REVENUE FUNDS FOR THE YEAR ENDED JUNE 30, 2012 84 277 278 280 283 284 Stag BYFAE Market LED H om eland EPA Jag Street Signage/Security G rant G rant (Federal)C rossw alks Tech. R escue R EVEN U ES Intergovernm ental revenue -$ 10,410$ -$ -$ -$ C harges for service - - - - - O ther incom e - - - - - TO TAL R EVEN U ES - 10,410 - - - EXPEN D ITU R ES Adm inistration - - - - - Public safety - - - - Education - - - - - C apital outlay - 2,686 3,375 616 - TO TAL EXPEN D ITU R ES - 2,686 3,375 616 - EXC ESS O F R EVEN U ES O VER (U N D ER ) EXPEN D ITU R ES - 7,724 (3,375) (616) - O TH ER FIN AN C IN G SO U R C ES (U SES) O perating Transfers In - 1,291 68,258 - 6,017 O perating Transfers (O ut)- - - - - TO TAL O TH ER FIN A NC IN G SO U R C ES (U SES)- 1,291 68,258 - 6,017 EXC ESS O F R EVEN U ES AN D O TH ER SO U R C ES O VER (U N D ER ) EXPEN D ITU R ES AN D O TH ER (U SES)- 9,015 64,883 (616) 6,017 FU N D BALAN C ES, JU LY 1 6,244 (9,015) (68,258) 28,763 (6,017) FU N D BALAN C ES, JU N E 30 6,244$ -$ (3,375)$ 28,147$ -$ SCHEDULE E (CONTINUED) CITY OF SOUTH BURLINGTON, VERMONT COMBINING SCHEDULE OF REVENUES, EXPENDITURES, AND CHANGES IN FUND BALANCES NONMAJOR SPECIAL REVENUE FUNDS FOR THE YEAR ENDED JUNE 30, 2012 85 286 287 288 290 293 San R em o C /L A/P Highw ay Fire D rive Sum m er A/G uard Safety Act Project Program Envirom ental G rant 2004 R EVEN U ES Intergovernm ental revenue 512$ -$ -$ 14,396$ -$ C harges for service - - 15,964 - - O ther incom e - - - - - TO TAL R EVEN U ES 512 - 15,964 14,396 - EXPEN D ITU R ES Adm inistration - - - - - Public safety - - - - - Education - - - - - C apital outlay - - - - - TO TAL EXPEN D ITU R ES - - - - - EXC ESS O F R EVEN U ES O VER (U N D ER ) EXPEN D ITU R ES 512 - 15,964 14,396 - O TH ER FIN AN C IN G SO U R C ES (U SES) O perating Transfers In - - - - 34,308 O perating Transfers (O ut)- - (77,936) - - TO TAL O TH ER FIN A NC IN G SO U R C ES (U SES)- - (77,936) - 34,308 EXC ESS O F R EVEN U ES AN D O TH ER SO U R C ES O VER (U N D ER ) EXPEN D ITU R ES AN D O TH ER (U SES)512 - (61,972) 14,396 34,308 FU N D BALAN C ES, JU LY 1 - 100 77,936 (6,424) (34,308) FU N D BALAN C ES, JU N E 30 512$ 100$ 15,964$ 7,972$ -$ SCHEDULE E (CONTINUED) CITY OF SOUTH BURLINGTON, VERMONT COMBINING SCHEDULE OF REVENUES, EXPENDITURES, AND CHANGES IN FUND BALANCES NONMAJOR SPECIAL REVENUE FUNDS FOR THE YEAR ENDED JUNE 30, 2012 86 298 299 Local O ptions/Fire D ept.615 617 R oom s/Meals Safer C om m unity C anine Tax G rant Developm ent U nit Totals R EVEN U ES Intergovernm ental revenue -$ -$ -$ -$ 218,368$ C harges for service - - - 1,308,425 O ther incom e - - - - 79,202 TO TAL R EVEN U ES - - - - 1,605,995 EXPEN D ITU R ES Adm inistration - - - - 169,050 Public safety - - - - 5,449 Education - - - - 90,232 C apital outlay - - - - 358,565 TO TAL EXPEN D ITU R ES - - - - 623,296 EXC ESS O F R EVEN U ES O VER (U N D ER ) EXPEN D ITU R ES - - - - 982,699 O TH ER FIN AN C IN G SO U R C ES (U SES) O perating Transfers In - 30,397 759 - 612,907 O perating Transfers (O ut)(1,510,318) - - - (4,913,466) TO TAL O TH ER FIN A NC IN G SO U R C ES (U SES) (1,510,318) 30,397 759 - (4,300,559) EXC ESS O F R EVEN U ES AN D O TH ER SO U R C ES O VER (U N D ER ) EXPEN D ITU R ES AN D O TH ER (U SES)(1,510,318) 30,397 759 - (3,317,860) FU N D BALAN C ES, JU LY 1 1,510,318 (30,397) (759) 5,000 5,229,433 FU N D BALAN C ES, JU N E 30 -$ -$ -$ 5,000$ 1,911,573$ See accom panying independent auditors' report. 87 Capital Projects Funds Capital projects funds are established to account for financial resources to be used for the acquisition or construction of major capital facilities, other than those financed by proprietary or trust fund. SCHEDULE F CITY OF SOUTH BURLINGTON, VERMONT COMBINING BALANCE SHEET - NONMAJOR CAPITAL PROJECT FUNDS JUNE 30, 2012 88 208 258 285 Spear C ity C enter San R em o 295 301 302 Street P lanning &Drive S/W R eappraisal Police Sew er D esign P roject O akcreek Fund H eadquarters ASSETS C ash and cash equivalents -$ -$ -$ -$ -$ -$ D ue from other funds 2,428 - - - 70,145 - TO TAL ASSETS 2,428$ -$ -$ -$ 70,145$ -$ LIABILITIES Accounts payable -$ -$ -$ -$ -$ -$ D ue to other funds - - - - - - D ue to other governm ents 2,428 - - - - - TO TAL LIABILITIES 2,428 - - - - - FU N D BALAN C ES N onspendable - - - - - - R estricted - - - - - - C om m itted - - - - 70,145 - Assigned - - - - - - U nassigned - - - - - - TO TAL FU N D BALAN C ES - - - - 70,145 - TO TAL LIABILITIES AN D FU N D BALAN C ES 2,428$ -$ -$ -$ 70,145$ -$ SCHEDULE F (CONTINUED) CITY OF SOUTH BURLINGTON, VERMONT COMBINING BALANCE SHEET - NONMAJOR CAPITAL PROJECT FUNDS JUNE 30, 2012 89 303 306 307 308 309 Kennedy Fire Am bulance O pen O pen Space D rive D epartm ent Equipm ent Space Special Reconstruction Fund Replacem ent Fund Assessm ent ASSETS C ash and cash equivalents -$ -$ -$ -$ -$ D ue from other funds - 129,000 105,000 - 793,779 TO TAL ASSETS -$ 129,000$ 105,000$ -$ 793,779$ LIABILITIES Accounts payable -$ -$ -$ -$ -$ D ue to other funds 9,754 - - - - D ue to other governm ents - - - - - TO TAL LIABILITIES 9,754 - - - - FU N D BALAN C ES N onspendable - - - - - R estricted - - - - - C om m itted - 129,000 105,000 - 793,779 Assigned - - - - - U nassigned (9,754) - - - - TO TAL FU N D BALAN C ES (9,754) 129,000 105,000 - 793,779 TO TAL LIABILITIES AN D FU N D BALAN C ES -$ 129,000$ 105,000$ -$ 793,779$ SCHEDULE F (CONTINUED) CITY OF SOUTH BURLINGTON, VERMONT COMBINING BALANCE SHEET - NONMAJOR CAPITAL PROJECT FUNDS JUNE 30, 2012 90 312 314 315 310 Tilley 313 Spear Fire D ept. AC O E R ecreation AC O E Street/Building BBN Path BBS Pinnacle Im provem ents ASSETS C ash and cash equivalents -$ -$ -$ -$ -$ D ue from other funds - - - - 40,000 TO TAL ASSETS -$ -$ -$ -$ 40,000$ LIABILITIES Accounts payable -$ -$ -$ -$ -$ D ue to other funds - - - - - D ue to other governm ents - - - - - TO TAL LIABILITIES - - - - - FU N D BALAN C ES N onspendable - - - - - R estricted - - - - - C om m itted - - - - 40,000 Assigned - - - - - U nassigned - - - - - TO TAL FU N D BALAN C ES - - - - 40,000 TO TAL LIABILITIES AN D FU N D BALAN C ES -$ -$ -$ -$ 40,000$ SCHEDULE F (CONTINUED) CITY OF SOUTH BURLINGTON, VERMONT COMBINING BALANCE SHEET - NONMAJOR CAPITAL PROJECT FUNDS JUNE 30, 2012 91 316 318 323 324 W P C Equip.317 Exit 14B AR R A AR R A R eplacem ent Vactor Staples Q uarry Tw in Fund SM MG 0054 3rd Lane R idge S/W O aks ASSETS C ash and cash equivalents -$ -$ -$ -$ -$ D ue from other funds - - - 37,327 106,248 TO TAL ASSETS -$ -$ -$ 37,327$ 106,248$ LIABILITIES Accounts payable -$ -$ -$ -$ -$ D ue to other funds - - 130,017 - - D ue to other governm ents - - - - - TO TAL LIABILITIES - - 130,017 - - FU N D BALAN C ES N onspendable - - - - - R estricted - - - 37,327 106,248 C om m itted - - - - - Assigned - - - - - U nassigned - - (130,017) - - TO TAL FU N D BALAN C ES - - (130,017) 37,327 106,248 TO TAL LIABILITIES AN D FU N D BALAN C ES -$ -$ -$ 37,327$ 106,248$ SCHEDULE F (CONTINUED) CITY OF SOUTH BURLINGTON, VERMONT COMBINING BALANCE SHEET - NONMAJOR CAPITAL PROJECT FUNDS JUNE 30, 2012 92 326 327 328 325 AR RA AR R A H ayes AR R A W inding H arbor Avenue R idgew ood Brook H eights Storm w ater Totals ASSETS C ash and cash equivalents -$ -$ -$ -$ -$ D ue from other funds 60,517 45,061 - - 1,389,505 TO TAL ASSETS 60,517$ 45,061$ -$ -$ 1,389,505$ LIABILITIES Accounts payable -$ -$ -$ -$ -$ D ue to other funds - - - 4,325 144,096 D ue to other governm ents - - - - 2,428 TO TAL LIABILITIES - - - 4,325 146,524 FU N D BALAN C ES N onspendable - - - - - R estricted 60,517 45,061 - - 249,153 C om m itted - - - - 1,137,924 Assigned - - - - - U nassigned - - - (4,325) (144,096) TO TAL FU N D BALAN C ES 60,517 45,061 - (4,325) 1,242,981 TO TAL LIABILITIES AN D FU N D BALAN C ES 60,517$ 45,061$ -$ -$ 1,389,505$ See accom panying independent auditors' report. SCHEDULE G CITY OF SOUTH BURLINGTON, VERMONT COMBINING SCHEDULE OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCES NONMAJOR CAPITAL PROJECTS FUNDS FOR THE YEAR ENDED JUNE 30, 2012 93 208 258 285 Spear C ity C enter S an R em o 295 301 302 Street Planning &D rive S/W R eappraisal Police Sew er D esign Project O akcreek Fund H eadquarters R EVEN U ES Intergovenm ental revenue -$ -$ 188,124$ -$ -$ Investm ent incom e - - - - - - O ther incom e - - - - 44,500 - TO TAL R EVEN U ES - - 188,124 - 44,500 - EXPEN D ITU R ES Adm inistration - - - - - - Public safety - - - - - - Public w orks - - - - - - C apital outlay - - 2,451 - - - TO TAL EXPEN D ITU R ES - - 2,451 - - - EXC ESS O F R EVEN U ES O VER (U N D ER ) EXPEN D ITU R ES - - 185,673 - 44,500 - O TH ER FIN AN C IN G SO U R C ES (U SES) O perating Transfers In - 76,183 21,529 - 70,500 164,872 O perating Transfers (O ut)(9,375) - - (629) - - TO TAL O TH ER FIN A NC IN G SO U R C ES (U SES)(9,375) 76,183 21,529 (629) 70,500 164,872 EXC ESS O F R EVEN U ES AN D O TH ER SO U R C ES O VER (U N DE R) EX PEN D ITU R ES AN D O TH ER (U SES)(9,375) 76,183 207,202 (629) 115,000 164,872 FU N D BALAN C ES, JU LY 1 9,375 (76,183) (207,202) 629 (44,855) (164,872) FU N D BALAN C ES, JU N E 30 -$ -$ -$ -$ 70,145$ -$ SCHEDULE G (CONTINUED) CITY OF SOUTH BURLINGTON, VERMONT COMBINING SCHEDULE OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCES NONMAJOR CAPITAL PROJECTS FUNDS FOR THE YEAR ENDED JUNE 30, 2012 94 303 306 307 308 309 Kennedy Fire Am bulance O pen O pen Space D rive D epartm ent Equipm ent Space Special R econstruction Fund R eplacem ent Fund Assessm ent R EVEN U ES Intergovenm ental revenue 711,726$ -$ -$ -$ -$ Investm ent incom e - - - - - O ther incom e - - - - - TO TAL R EVEN U ES 711,726 - - - - EXPEN D ITU R ES Adm inistration - - - - - Public safety - - - - - Public w orks - - - - - C apital outlay 721,480 - - - - TO TAL EXPEN D ITU R ES 721,480 - - - - EXC ESS O F R EVEN U ES O VER (U N D ER ) EXPEN D ITU R ES (9,754) - - - - O TH ER FIN AN C IN G SO U R C ES (U SES) O perating Transfers In 258,243 64,000 - - 273,000 O perating Transfers (O ut)- - - (1,380) - TO TAL O TH ER FIN A NC IN G SO U R C ES (U SES)258,243 64,000 - (1,380) 273,000 EXC ESS O F R EVEN U ES AN D O TH ER SO U R C ES O VER (U N DE R) EX PEN D ITU R ES AN D O TH ER (U SES)248,489 64,000 - (1,380) 273,000 FU N D BALAN C ES, JU LY 1 (258,243) 65,000 105,000 1,380 520,779 FU N D BALAN C ES, JU N E 30 (9,754)$ 129,000$ 105,000$ -$ 793,779$ SCHEDULE G (CONTINUED) CITY OF SOUTH BURLINGTON, VERMONT COMBINING SCHEDULE OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCES NONMAJOR CAPITAL PROJECTS FUNDS FOR THE YEAR ENDED JUNE 30, 2012 95 312 314 315 310 Tilley 313 Spear Fire D ept. AC O E R ecreation AC O E S treet/B uilding B BN Path BBS Pinnacle Im provem ents R EVEN U ES Intergovenm ental revenue -$ -$ -$ -$ -$ Investm ent incom e - - - - - O ther incom e - - - - - TO TAL R EVEN U ES - - - - - EXPEN D ITU R ES Adm inistration - - - - - Public safety - - - - Public w orks - - - - - C apital outlay 15,142 400 - - - TO TAL EXPEN D ITU R ES 15,142 400 - - - EXC ESS O F R EVEN U ES O VER (U N D ER ) EXPEN D ITU R ES (15,142) (400) - - - O TH ER FIN AN C IN G SO U R C ES (U SES) O perating Transfers In 132,396 - - 179,820 40,000 O perating Transfers (O ut)- (872) (134,042) - (3,480) TO TAL O TH ER FIN A NC IN G SO U R C ES (U SES)132,396 (872) (134,042) 179,820 36,520 EXC ESS O F R EVEN U ES AN D O TH ER SO U R C ES O VER (U N DE R) EX PEN D ITU R ES AN D O TH ER (U SES)117,254 (1,272) (134,042) 179,820 36,520 FU N D BALAN C ES, JU LY 1 (117,254) 1,272 134,042 (179,820) 3,480 FU N D BALAN C ES, JU N E 30 -$ -$ -$ -$ 40,000$ SCHEDULE G (CONTINUED) CITY OF SOUTH BURLINGTON, VERMONT COMBINING SCHEDULE OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCES NONMAJOR CAPITAL PROJECTS FUNDS FOR THE YEAR ENDED JUNE 30, 2012 96 316 318 323 324 W PC Equip.317 Exit 14B AR R A AR R A R eplacem ent V actor S taples Q uarry Tw in Fund SM M G 0054 3rd Lane R idge S/W O aks R EVEN U ES Intergovenm ental -$ -$ 9,579$ -$ -$ Investm ent incom e - - - - - O ther incom e - - - - - TO TAL R EVEN U ES - - 9,579 - - EXPEN D ITU R ES Adm inistration - - - - - Public safety - - - - - Public w orks - - - - - C apital outlay - - 115,779 - - TO TAL EXPEN D ITU R ES - - 115,779 - - EXC ESS O F R EVEN U ES O VER (U N D ER ) EXPEN D ITU R ES - - (106,200) - - O TH ER FIN AN C IN G SO U R C ES (U SES) O perating Transfers In - 128,320 14,330 - - O perating Transfers (O ut)(488,976) - - - - TO TAL O TH ER FIN A NC IN G SO U R C ES (U SES)(488,976) 128,320 14,330 - - EXC ESS O F R EVEN U ES AN D O TH ER SO U R C ES O VER (U N DE R) EX PEN D ITU R ES AN D O TH ER (U SES)(488,976) 128,320 (91,870) - - FU N D BALAN C ES, JU LY 1 488,976 (128,320) (38,147) 37,327 106,248 FU N D BALAN C ES, JU N E 30 -$ -$ (130,017)$ 37,327$ 106,248$ SCHEDULE G (CONTINUED) CITY OF SOUTH BURLINGTON, VERMONT COMBINING SCHEDULE OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCES NONMAJOR CAPITAL PROJECTS FUNDS FOR THE YEAR ENDED JUNE 30, 2012 97 326 327 328 325 AR R A AR R A H ayes AR R A W inding Harbor Avenue R idgew ood Brook H eights Storm w ater Totals R EVEN U ES Intergovenm ental revenue -$ -$ 24,444$ -$ 933,873$ Investm ent incom e - - - - - O ther incom e 36,274 - - - 80,774 TO TAL R EVEN U ES 36,274 - 24,444 - 1,014,647 EXPEN D ITU R ES Adm inistration - - - - - Public safety - - - - - Public w orks - - - - - C apital outlay - - - 4,325 859,577 TO TAL EXPEN D ITU R ES - - - 4,325 859,577 EXC ESS O F R EVEN U ES O VER (U N D ER ) EXPEN D ITU R ES 36,274 - 24,444 (4,325) 155,070 O TH ER FIN AN C IN G SO U R C ES (U SES) O perating Transfers In - - 3,890 9,296 1,436,379 O perating Transfers (O ut)(36,274) - (24,444) - (699,472) TO TAL O TH ER FIN A NC IN G SO U R C ES (U SES)(36,274) - (20,554) 9,296 736,907 EXC ESS O F R EVEN U ES AN D O TH ER SO U R C ES O VER (U N DE R) EX PEN D ITU R ES AN D O TH ER (U SES)- - 3,890 4,971 891,977 FU N D BALAN C ES, JU LY 1 60,517 45,061 (3,890) (9,296) 351,004$ FU N D BALAN C ES, JU N E 30 60,517$ 45,061$ -$ (4,325)$ 1,242,981$ See accom panying independent auditors' report. 98 Permanent Funds Permanent funds are used to account for assets held by the City of South Burlington, Vermont in trust or as an agent for individuals, private organizations, other governmental units and/or other funds. These funds have been established for the provision and/or maintenance of the cemeteries and various community organizations. SCHEDULE H CITY OF SOUTH BURLINGTON, VERMONT COMBINING BALANCE SHEET - NONMAJOR PERMANENT FUNDS JUNE 30, 2012 99 C om m unity Library C om m unity R ecreation C em etary Trust C horus D onation P.A.C .T. ASSETS Investm ents -$ -$ -$ -$ -$ D ue from other agencies - - - - - D ue from other funds 4,599 57,482 706 5,254 3,012 TO TAL ASSETS 4,599$ 57,482$ 706$ 5,254$ 3,012$ LIABILITIES D ue to other funds -$ -$ -$ -$ -$ D ue to agencies - - 706 - - TO TAL LIABILITIES - - 706 - - FU N D BALAN C ES N onspendable - - - - - R estricted 4,599 57,482 - - 3,012 C om m itted - - - 5,254 - Assigned - - - - - U nassigned - - - - - TO TAL FU N D BALAN C ES 4,599 57,482 - 5,254 3,012 TO TAL LIABILITIES AN D FU N D BALAN C ES 4,599$ 57,482$ 706$ 5,254$ 3,012$ SCHEDULE H (CONTINUED) CITY OF SOUTH BURLINGTON, VERMONT COMBINING BALANCE SHEET - NONMAJOR PERMANENT FUNDS JUNE 30, 2012 100 D orset R ecreation Mem orial Veterans S treet Path Fund Mem orial Banners D onations ASSETS Investm ents -$ -$ -$ -$ D ue from other agencies - - - - D ue from other funds 2,886 31,720 - 5,482 TO TAL ASSETS 2,886$ 31,720$ -$ 5,482$ LIABILITIES D ue to other funds -$ -$ -$ -$ D ue to agencies - - - 5,482 TO TAL LIABILITIES - - - 5,482 FU N D BALAN C ES N onspendable - - - - R estricted 2,886 31,720 - - C om m itted - - - - Assigned - - - - U nassigned - - - - TO TAL FU N D BALAN C ES 2,886 31,720 - - TO TAL LIABILITIES AN D FU N D BALAN C ES 2,886$ 31,720$ -$ 5,482$ SCHEDULE H (CONTINUED) CITY OF SOUTH BURLINGTON, VERMONT COMBINING BALANCE SHEET - NONMAJOR PERMANENT FUNDS JUNE 30, 2012 101 Fire C om m unity Library Departm ent D og Park M usic (B lanchette)D onations D onations Festival Totals ASSETS Investm ents 368,393$ -$ -$ -$ 368,393$ D ue from agencies - - - 75 75 D ue from other funds - - 838 - 111,979 TO TAL ASSETS 368,393$ -$ 838$ 75$ 480,447$ LIABILITIES D ue to other funds 159$ 811$ -$ 75$ 1,045$ D ue to agencies - - - - 6,188 TO TAL LIABILITIES 159 811 - 75 7,233 FU N D BALAN C ES N onspendable - - - - - R estricted 368,234 - - - 467,933 C om m itted - - 838 - 6,092 Assigned - - - - - U nassigned - (811) - - (811) TO TAL FU N D BALAN C ES 368,234 (811) 838 - 473,214 TO TAL LIABILITIES AN D FU N D BALAN C ES 368,393$ -$ 838$ 75$ 480,447$ See accom panying independent auditors' report. SCHEDULE I CITY OF SOUTH BURLINGTON, VERMONT COMBINING SCHEDULES OF REVENUES, EXPENDITURES, CHANGES IN FUND BALANCES NONMAJOR PERMANENT FUNDS FOR THE YEAR ENDED JUNE 30, 2012 102 C om m unity Library C om m unity R ecreation C em etary Trust C horus D onation P.A .C .T. R EVEN U ES C harges for services -$ 1,650$ -$ -$ 350$ Investm ent incom e - - - - - Miscellanous - 38,943 - 6,529 3,579 TO TAL R EVEN U ES - 40,593 - 6,529 3,929 EXPEN D ITU R ES Public safety - - - - - O ther 400 2,730 4,064 2,974 TO TAL EXPEN D ITU R ES 400 2,730 - 4,064 2,974 EXC ESS O F R EVEN U ES O VER (U N D ER ) EXPEN D ITU R ES (400) 37,863 - 2,465 955 O TH ER FIN AN C IN G SO U R C ES (U SES) O perating Transfers In - - - - - O perating Transfers (O ut)- - - - - TO TAL O TH ER FIN A NC IN G SO U R C ES (U SES)- - - - - EXC ESS O F R EVEN U ES AN D O TH ER SO U R C ES O VER (U N DE R) EX PEN D ITU R ES AN D O TH ER (U SES)(400) 37,863 - 2,465 955 FU N D BALAN C ES, JU LY 1 4,999 19,619 - 2,789 2,057 FU N D BALAN C ES, JU N E 30 4,599$ 57,482$ -$ 5,254$ 3,012$ SCHEDULE I (CONTINUED) CITY OF SOUTH BURLINGTON, VERMONT COMBINING SCHEDULES OF REVENUES, EXPENDITURES, CHANGES IN FUND BALANCES NONMAJOR PERMANENT FUNDS FOR THE YEAR ENDED JUNE 30, 2012 103 D orset R ecreation M em orial Veterans Street Path Fund M em orial Banners D onations R EVEN U ES C harges for services -$ -$ -$ -$ Investm ent incom e - - - - Miscellanous - 32,754 - - TO TAL R EVEN U ES - 32,754 - - EXPEN D ITU R ES Public safety - - - - O ther - 5,934 - - TO TAL EXPEN D ITU R ES - 5,934 - - EXC ESS O F R EVEN U ES O VER (U N D ER ) EXPEN D ITU R ES - 26,820 - - O TH ER FIN AN C IN G SO U R C ES (U SES) O perating Transfers In - - - - O perating Transfers (O ut)- - (9) - TO TAL O TH ER FIN A NC IN G SO U R C ES (U SES)- - (9) - EXC ESS O F R EVEN U ES AN D O TH ER SO U R C ES O VER (U N DE R) EX PEN D ITU R ES AN D O TH ER (U SES)- 26,820 (9) - FU N D BALAN C ES, JU LY 1 2,886 4,900 9 - FU N D BALAN C ES, JU N E 30 2,886$ 31,720$ -$ -$ SCHEDULE I (CONTINUED) CITY OF SOUTH BURLINGTON, VERMONT COMBINING SCHEDULES OF REVENUES, EXPENDITURES, CHANGES IN FUND BALANCES NONMAJOR PERMANENT FUNDS FOR THE YEAR ENDED JUNE 30, 2012 104 Fire C om m unity Library D epartm ent D og P ark Music (Blanchette)D onations D onations Festival Totals R EVEN U ES C harges for services -$ -$ -$ -$ 2,000$ Investm ent incom e 8,500 - - - 8,500 Miscellanous (5,147) 435 70 - 77,163 TO TAL R EVEN U ES 3,353 435 70 - 87,663 EXPEN D ITU R ES Public safety - 1,246 - - 1,246 O ther - - - - 16,102 TO TAL EXPEN D ITU R ES - 1,246 - - 17,348 EXC ESS O F R EVEN U ES O VER (U N D ER ) EXPEN D ITU R ES 3,353 (811) 70 - 70,315 O TH ER FIN AN C IN G SO U R C ES (U SES) O perating Transfers In - 1,486 - - 1,486 O perating Transfers (O ut)(8,500) - - - (8,509) TO TAL O TH ER FIN A NC IN G SO U R C ES (U SES)(8,500) 1,486 - - (7,023) EXC ESS O F R EVEN U ES AN D O TH ER SO U R C ES O VER (U N DE R) EX PEN D ITU R ES AN D O TH ER (U SES)(5,147) 675 70 - 63,292 FU N D BALAN C ES, JU LY 1 373,381 (1,486) 768 - 409,922 FU N D BALAN C ES, JU N E 30 368,234$ (811)$ 838$ -$ 473,214$ See accom panying independent auditors' report. General Capital Assets 105 General capital assets are those assets related to activities reported in the governmental funds. These assets are reported in the governmental activities column of the government-wide statement of net assets. SCHEDULE J CITY OF SOUTH BURLINGTON, VERMONT SCHEDULE OF GENERAL CAPITAL ASSETS BY FUNCTION JUNE 30, 2012 106 F urniture, L and and Building s Fixtures, N on-depreciable Build ings Im proveme nts Equ ipmen t Assets & L and Improvements & Veh icles In frastructure Total G enera l G overnm ent 329,511$ 1 ,398,945$ 75,4 25$ -$ 1,80 3,881$ Ambulance - - 185,1 69 - 18 5,169 Fire 1,118,500 6 ,314,977 2,110,4 19 - 9,54 3,896 Police - 7 ,319,538 1,606,1 75 - 8,92 5,713 H ighw ay 904,654 - 2,132,5 99 4 56,585 3,49 3,838 Public W orks 6,621,526 791,049 219,1 83 36,3 24,586 43,95 6,344 Library - - 12,0 84 - 1 2,084 R ecreation 2,610,952 323,206 141,7 69 2,0 67,014 5,14 2,941 H ealth 280,500 681,648 - 1 08,305 1,07 0,453 Airpo rt 21,375,571 - - - 21,37 5,571 C ity W ide 1,360,300 8,600 - - 1,36 8,900 Storm W ater U tilitie s 30,000 154,994 616,2 02 4 79,044 1,28 0,240 W ater Pollution C ontrol 488,000 13 ,170,884 352,6 19 8 11,308 14,82 2,811 W ater D ep artment - - 6,608,0 77 - 6,60 8,077 Total G eneral C apital Assets 35,119,514 30 ,163,841 14,059,7 21 40,2 46,842 119,58 9,918 Less: Accum ulated De preciation - (18 ,580,990) (6,892,3 88) (32,9 12,195) (58,38 5,573) N et G eneral C apital Assets 35,119,514$ 11 ,582,851$ 7,167,3 33$ 7,3 34,647$ 61,20 4,345$ See accom panying independ ent auditors' report. SCHEDULE K CITY OF SOUTH BURLINGTON, VERMONT SCHEDULE OF CHANGES IN GENERAL CAPITAL ASSETS BY FUNCTION FOR THE YEAR ENDED JUNE 30, 2012 107 G enera l G eneral C apita l C apital Assets Assets 7/1/1 1 Additions D eletions 6/30/12 G enera l G overnm ent 1,803,88 1$ -$ -$ 1,803,881$ Ambulance 185,16 9 - - 185,169 Fire 9,543,89 6 - - 9,543,896 Police 8,925,71 3 - - 8,925,713 H ighw ay 3,493,83 8 - - 3,493,838 Public W orks 43,956,34 4 - - 43,956,344 Library 12,08 4 - - 12,084 R ecreation 5,142,94 1 - - 5,142,941 H ealth 1,070,45 3 - - 1,070,453 Airpo rt 21,375,57 1 - - 21,375,571 C ity W ide 1,368,90 0 - - 1,368,900 Storm W ater U tilitie s 1,280,24 0 - - 1,280,240 W ater Pollution C ontrol 14,822,81 1 - - 14,822,811 W ater D ep artment 6,506,82 7 10 1,250 - 6,608,077 Total G eneral C apital Assets 119,488,66 8 10 1,250 - 1 19,589,918 Less: Accum ulated De preciation (56,458,49 3) (1,92 7,080) - (58,385,573) N et G eneral C apital Assets 63,030,17 5$ (1,82 5,830)$ -$ 61,204,345$ See accom panying independ ent auditors' report. CITY OF SOUTH BURLINGTON, VERMONT SCHEDULE OF EXPENDITURES OF FEDERAL AWARDS JUNE 30, 2012 108 Federal G rantor F ederal P ass Thru P ass Through G rantor C FD A G rantor Federal P rogram Title N um ber N um ber E xpenditures U .S . Agency of Transportation P assed through V erm ont A gency of Transportation: Federal A id H ighw ay: B utler Farm S W P ond 20.205 08126-S W 0047 32,093$ K ennedy D rive 20.205 08126-C A 0006 721,480 Tilley D rive 20.205 08126-13E H 07 400 S taples 3rd Lane 20.205 08126-C A 0241 115,779 Total A gency of T ransportation 869,752 U .S . D epartm ent of D efense D irect Program : M ilitary C onstruction 21.400 N /A 57,966 E nvirom ental P rotection A gency: D irect Program : C ongressionally M andated P rojects 66.202 N /A 116,183 E dw ard B yrne M em orial Justice A ssistance 66.202 N /A 2,686 P assed Through V erm ont E nvirom ental P rotection: A irport P arkway E xpansion/R evolving Loan 66.458 06140-AR 1-067 3,057,438 Total E nvirom ental P rotection A gency 3,176,307 D epartm ent of H omeland S ecurity D irect Program : FE M A M im ic G rant 97.044 N /A 97,731 P assed Through V erm ont P ublic S afety: H om eland Security P rogram 97.067 02140-77252-106 33,502 Total D epartem ent of H om eland S ecurity 131,233 TO TA L FE D E R A L A S S IS TA N C E 4,235,258$ CITY OF SOUTH BURLINGTON, VERMONT NOTES TO SCHEDULE OF FEDERAL AWARDS JUNE 30, 2012 109 1. General The accompanying Schedule of Expenditures of Federal Awards presents the activity of all federal award programs of the City of South Burlington, Vermont. All federal financial assistance received is included on the schedule. 2. Basis of Accounting The accompanying Schedule of Expenditures of Federal Awards is presented using the accrual basis of accounting. 3. The following programs were tested as Type A program as outlined in OMB Circular A-133. 1) 66.458 – Revolving Loan Fund 110 INDEPENDENT AUDITORS’ REPORT ON INTERNAL CONTROL OVER FINANCIAL REPORTING AND ON COMPLIANCE AND OTHER MATTERS BASED ON AN AUDIT OF FINANCIAL STATEMENTS PERFORMED IN ACCORDANCE WITH GOVERNMENT AUDITING STANDARDS November 16, 2012 City Council City of South Burlington South Burlington, Vermont We have audited the financial statements of the City of South Burlington, Vermont, as of and for the year ended June 30, 2012, and have issued our report thereon dated November 16, 2012. We conducted our audit in accordance with auditing standards generally accepted in the United States of America and the standards applicable to financial audits contained in Government Auditing Standards, issued by the Comptroller General of the United States. Internal Control Over Financial Reporting In planning and performing our audit, we considered City of South Burlington, Vermont’s internal control over financial reporting as a basis for designing our auditing procedures for the purpose of expressing our opinion on the financial statements, but not for the purpose of expressing an opinion on the effectiveness of the City of South Burlington, Vermont’s internal control over financial reporting. Accordingly, we do not express an opinion on the effectiveness of the Organization’s internal control over financial reporting. A deficiency in internal control exists when the design or operation of a control does not allow management or employees, in the normal course of performing their assigned functions, to prevent or detect misstatements on a timely basis. A material weakness is a deficiency, or combination of deficiencies, in internal control such that there is a reasonable possibility that a material misstatement of the entity’s financial statements will not be prevented, or detected and corrected on a timely basis. Our consideration of internal control over financial reporting was for the limited purpose described in the first paragraph of this section and was not necessarily designed to identify all deficiencies in internal control over financial reporting that might be deficiencies, significant deficiencies, or material weaknesses. We did not identify any deficiencies in internal control over financial reporting that we consider to be material weaknesses, as defined above. 3 Old Orchard Road, Buxton, Maine 04093 Tel: (800) 300-7708 (207) 929-4606 Fax: (207) 929-4609 www.rhrsmith.com Proven Expertise and Integrity 111 Compliance and Other Matters As part of obtaining reasonable assurance about whether City of South Burlington, Vermont’s financial statements are free of material misstatement, we performed tests of its compliance with certain provisions of laws, regulations, contracts and grant agreements, noncompliance with which could have a direct and material effect on the determination of financial statement amounts. However, providing an opinion on compliance with those provisions was not an objective of our audit and, accordingly, we do not express such an opinion. The results of our tests disclosed no instances of noncompliance or other matters that are required to be reported under Government Auditing Standards. We noted certain other matters that we reported to management of the City of South Burlington, Vermont in a separate letter dated December 7, 2012. This report is intended solely for the information of the City Council, management and federal awarding agencies and pass-through entities and is not intended to be and should not be used by anyone other than the specified parties. Certified Public Accountants 112 INDEPENDENT AUDITORS’ REPORT ON COMPLIANCE WITH REQUIREMENTS THAT COULD HAVE A DIRECT AND MATERIAL EFFECT ON EACH MAJOR PROGRAM AND ON INTERNAL CONTROL OVER COMPLIANCE IN ACCORDANCE WITH OMB CIRCULAR A-133 November 16, 2012 City Council City of South Burlington South Burlington, Vermont Compliance We have audited City of South Burlington, Vermont’s compliance with the types of compliance requirements described in the OMB Circular A-133 Compliance Supplement that could have a direct and material effect on each of City of South Burlington, Vermont’s major federal programs for the year ended June 30, 2012. City of South Burlington, Vermont’s major federal programs are identified in the summary of auditor’s results section of the accompanying schedule of findings and questioned costs. Compliance with the requirements of laws, regulations, contracts, and grants applicable to each of its major federal programs is the responsibility of City of South Burlington, Vermont’s management. Our responsibility is to express an opinion on City of South Burlington, Vermont’s compliance based on our audit. We conducted our audit of compliance in accordance with auditing standards generally accepted in the United States of America; the standards applicable to financial audits contained in Government Auditing Standards, issued by the Comptroller General of the United States; and OMB Circular A-133, Audits of States, Local Governments, and Non-Profit Organizations. Those standards and OMB Circular A-133 require that we plan and perform the audit to obtain reasonable assurance about whether noncompliance with the types of compliance requirements referred to above that could have a direct and material effect on a major federal program occurred. An audit includes examining, on a test basis, evidence about City of South Burlington, Vermont’s compliance with those requirements and performing such other procedures as we considered necessary in the circumstances. We believe that our audit provides a reasonable basis for our opinion. Our audit does not provide a legal determination of City of South Burlington, Vermont’s compliance with those requirements. Proven Expertise and Integrity 3 Old Orchard Road, Buxton, Maine 04093 Tel: (800) 300-7708 (207) 929-4606 Fax: (207) 929-4609 www.rhrsmith.com 113 In our opinion, City of South Burlington, Vermont, complied, in all material respects, with the compliance requirements referred to above that could have a direct and material effect on each of its major federal programs for the year ended June 30, 2012. Internal Control over Compliance Management of City of South Burlington, Vermont is responsible for establishing and maintaining effective internal control over with the requirements of laws, regulations, contracts, and grants applicable to federal programs. In planning and performing our audit, we considered City of South Burlington, Vermont’s internal control over compliance with requirements that could have a direct and material effect on a major federal program to determine the auditing procedures for the purpose of expressing our opinion on compliance and to test and report on internal control over compliance in accordance with OMB Circular A-133, but not for the purpose of expressing an opinion on the effectiveness of internal control over compliance. Accordingly, we do not express an opinion on the effectiveness of City of South Burlington, Vermont’s internal control over compliance. A deficiency in internal control over compliance exists when the design or operation of a control over compliance does not allow management or employees, in the normal course of performing their assigned functions, to prevent, or detect and correct, noncompliance with a type of compliance requirement of a federal program on a timely basis. A material weakness in internal control over compliance is a deficiency, or combination of deficiencies, in internal control over compliance; such that there is a reasonable possibility that material noncompliance with a type of compliance requirement of a federal program will not be prevented or detected and corrected, on a timely basis. Our consideration of internal control over compliance was for the limited purpose described in the first paragraph of this section and was not designed to identify all deficiencies in internal control over compliance that might be deficiencies, significant deficiencies, or material weaknesses. We did not identify any deficiencies in internal control over compliance that we consider to be material weaknesses, as defined above. This report is intended solely for the information and use of management, City Council, others within the entity, and federal awarding agencies and pass-through entities and is not intended to be and should not be used by anyone other than the specified parties. Certified Public Accountants CITY OF SOUTH BURLINGTON, VERMONT SCHEDULE OF FINDINGS AND QUESTIONED COSTS FOR THE YEAR ENDED JUNE 30, 2012 114 Section I - Summary of Auditor’s Results  Financial Statements Type of auditor’s report issued : Unqualified Internal control over financial reporting:  Material weakness(es) identified? yes X no  Significant deficieny(ies) identified? yes X no  Noncompliance material to financial statements noted yes X no  Federal Awards Internal control over major programs:  Material weakness(es) identified? yes X no  Significant deficiency(ies) identified? yes X no Type of auditor’s report issued on compliance for major programs: Unqualified Any audit findings disclosed that are required to be reported In accordance with section 510(a) of OMB Circular A-133? yes X no Identification of major programs: CFDA Numbers Name of Federal Program or Cluster 66.458 Revolving Loan Fund Dollar threshold used to distinguish between type A and B: $300,000 Auditee qualified as low-risk auditee? X yes _ no Section II – Financial Statement Findings None Section III – Federal Awards Findings and Questioned Costs None