City of Arvada 2015 Third Quarter Financial Report

Financial Report

2015 Third Quarter

Olde Town Tr ansit Hub Site Photo Credit Ryan Adler Oct 2015

Table of Contents Overview.......................................................................................1 General Fund...............................................................................3 Arvada Center..............................................................................7 Parks Fund...................................................................................9 Special Revenue Funds........................................................... 11 Capital Improvements Projects Fund.................................... 13 Enterprise Funds...................................................................... 15 Internal Service Funds............................................................. 21 City of Arvada Investment Report.......................................... 25

OVERVIEW

2015 Third Quarter Report The Financial Report for the City of Arvada provides an unaudited overview of the major funds and how their revenues and expenditures performed in comparison to budget. This is not meant to be a complete accounting, but rather a quick look at the highlights.

Revenues in the General Fund continue to be strong, with 9% year-over-year growth in 2015 as compared to 2014. All major revenue categories are participating, except property tax, led by building revenues and sales tax. Actual sales tax revenues are up 6.6% compared to the same time period in 2014. We are now in our sixth consecutive year of growth (2009-2015). The major categories of Fast-Casual Restaurants, Retail Hardware, Auto Care, Office Supplies, Office Equipment, Furniture, Appliances and Flooring lead the way with double-digit increases over 2014.

The graph below represents building revenue and permits for the past five years. The pace of new construction continues to increase as 521 singlefamily building permits were issued through the third quarter of 2015. The Colorado economy is the fifth fastest growing economy in the United States and the Denver Metro region leads the way. Interestingly, the third quarter 2015 experienced the first quarter-over-quarter decline since the fourth quarter of 2011. We will continue to monitor single-family permits to see if this was an anomaly or a leading indicator of a housing slowdown.

General Fund Building Revenue through September $9,000,000

540

$8,000,000

Dollars

$6,000,000

360

$5,000,000 270

$4,000,000 $3,000,000

180

$2,000,000

90

$1,000,000 $0 GF Building Revenue Single-Family (Detached) Permits

2011 3,182,772

2012 4,044,707

2013 4,873,086

2014 7,087,076

2015 8,312,979

99

253

341

470

521

0

Auto Use tax revenue increased its growth pattern, now up 15.9% over 2014 actuals. We are in the middle of six years (2010-2015) of consecutive growth.

Taking center stage as the Gold Line nears completion is the Olde Town Transit Hub. Shoring, excavating and water remediation are the tasks currently underway on this project. In the next few months, we will see the start of the parking structure emerging out of the ground.

The other area of concentration in the capital fund for the third quarter has been “Taking Lasting Care�. Playground renovations at Meadowlake, Oak and Jack B. Tomlinson Parks will be completed by October. Updated traffic signals at five intersections will also be completed by the end of the year.

Elimination of the summer musical was another part of the continued cost-control measures being put in place by the Arvada Center. This has led to a reduction in the overall revenue, as well as the corresponding expenditures. The Center is still struggling to meet its projected ticket sales along with projected fundraising. Current estimates put the year-end gap around $180,000.

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Permits

450

$7,000,000

Currently, the Arvada Housing Authority is helping 465 families out of a an authorized maximum of 508. Savings are being used to offset the drastic increase in rental costs. This is a sign of how competitive the current rental market is and how the Authority is working to keep as many families in their homes as possible While rain was the story in the second quarter for the enterprise funds, the exact opposite was the story in the third quarter. This has enabled the Water Fund to close the gap on both consumption and water fees. Year-to-date revenues are now down 9.8% with year-end loss projections in the 5-6% range.

West Woods Golf Club came roaring back with one of the best third quarters on record. Daily play, along with tournament rounds, increased significantly over 2014. This moved yearly revenue from 5% down in the second quarter to 2% up in the third quarter. Unfortunately, Lake Arbor Golf Club continues to struggle with rounds down 10% compared to 2014. The two restaurants have maintained their good start to the year, with revenues up 6.6% compared to the same time period in 2014.

Investment income recorded its third consecutive quarter of growth, up to an annualized yield of .751%. This surpasses the benchmark of .570% by over 18 basis points and represents a well-diversified portfolio. Everyone is still waiting for the Federal Reserve to do something with rates. The economists are now targeting the time period between December 2015 and March 2016.

The revised 2016 budget was approved by City Council on October 26. The updated budget includes some smaller line item changes, increased funding to help address some security risks and the addition of seven new police officers aided by a Department of Justice COPS grant. The City was the only local agency selected to receive this grant from the 17 that applied. Our commitment to sector-based policing was one of the items that set us apart from the other applicants.

The City is in good financial condition as we close the third quarter of 2015. Assuming a strong finish, we should meet our revenue budget in most categories and exceed it in a few. This additional revenue will be dedicated to addressing some pressing capital needs.

M ajestic View Photo Credit Richard Assmus APR 2013

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The General Fund pays for the City’s basic services. This includes police, street maintenance, planning, transportation planning, code enforcement, street light maintenance and costs, building activity and general administration. In addition, the General Fund also provides for the following: • Operational support to the Arvada Center • Operational support to the Parks Fund • General Debt Service payments • Transfer to the Capital Improvement Projects Fund for new parks, transportation and other infrastructure projects The following table provides a comparison of budgeted cash balances, revenues and expenditures to budget and prior year amounts in the same areas.

2015 Budget

As of 9/30/15

Beginning Fund Balance

$30,847,000

$30,847,000

REVENUES

$75,878,254

$58,905,986

$54,261,127

Ongoing

77,197,847

48,147,912

45,597,836

Capital

7,299,941

8,383,509

25,779

JPPHA

1,255,000

770,650

200,000

$85,752,788

$57,302,071

$45,823,615

1,603,915

8,437,512

General Fund

As of 9/30/14

EXPENDITURES

Expenditures Income/(Loss) Ending Fund Balance

(9,874,534) $20,972,466

$32,450,915

The General Fund began 2015 with a $30,847,000 fund balance. Some of this fund balance, $4,135,132, was dedicated to 2014 carry-over items not completed in 2014 and one-time requests. An additional $3,106,146 of one-time funds was added to the Capital Fund for the Olde Town Transit Hub improvements. We will also use $2,613,256 to balance the budget. These dollars will be taken from fund balance.

Hills at Standley Lake Garden Photo Credit Richard Assmus

Revenue Highlights Overall, revenues are up 9% compared to the same time period in 2014. In general, revenues are in line with the 2015 budget estimate for the majority of revenue categories that will exceed the 2015 budget estimate, except sales tax and building revenue. The major revenue categories of sales tax, use tax, property tax, building and intergovernmental revenues are discussed in more detail in the following tables and graphs. The investment report at the end of this document will provide details of the City’s investments. Investment revenue will continue to be low as the current investment environment is not expected to change until late 2015 or early 2016.

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GENERAL FUND

General Fund Overview

GENERAL FUND REVENUES Sales Tax 49%

Property Tax 8%

Use Tax 1%

Auto Use Tax 7% Other 21% Franchise Fees Court Fines & Fees 4% 2%

Interest 1%

Sales Tax

The graph below shows actual third quarter sales tax collections from 2011 to 2015. Sales tax collections lag one month; therefore, collections through the third quarter represent sales tax collections for eight months. The City has now seen an increase in third quarter sales tax collections for six straight years (2009-2015).

Building Use Tax & Permits 7%

Sales Tax Collections

$50,000,000 $40,000,000 $30,000,000

Sales tax receipts for the first eight months of 2015 are 6.6% above 2014 actuals. Based on the positive trend of sales tax revenues, the sales tax budget was revised to $45,638,143 for 2015, representing a 5.5% increase over 2014 actual sales tax collections.

$20,000,000 $10,000,000 $0

09/30/2011 09/30/2012 09/30/2013 09/30/2014 09/30/2015 2015 Budget Sales Tax $23,156,589 $24,552,903 $25,953,189 $27,844,593 $29,688,649 $45,638,143

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Use Tax The City has three primary use tax types: general, building and automobile. These are taxes paid in lieu of sales tax on purchases.

Use Tax Collections $14,000,000 $12,000,000

General use tax is slightly below 2014 actuals through eight months, but should meet the budget of $1,569,575.

$10,000,000

Building use tax for 2015 is at $4.1 million which exceeds the original budget of $2,100,000. Due to the continued growth in west Arvada, the budget for building use tax was increased to $4,950,000 for 2015. Based on the current pace, building use tax will meet the revised budgeted amount.

$6,000,000

Auto use tax collections are showing a 15.9% increase over 2014 collections. Auto use tax collections are on track to meet or exceed the revised 2015 budgeted amount of $6,000,000.

$8,000,000

$4,000,000 $2,000,000 $0 General

09/30/2011 $897,032

09/30/2012 $682,027

09/30/2013 $873,197

09/30/2014 $890,495

09/30/2015 $858,212

2015 Budget $1,569,575

Auto

$2,894,875

$3,239,957

$3,516,156

$3,914,175

$4,536,196

$6,000,000

Building

$1,495,301

$1,898,048

$2,348,796

$3,429,533

$4,142,569

$4,950,000

Building

Property Tax The City’s property tax rate is 4.31 mills per $100 of valuation.

In Colorado, the mill rate is placed on the assessed valuation.

The following graph illustrates the year-to-date collections for the current and past four years.

Auto

General

Property Tax Collections $5,000,000 $4,500,000 $4,000,000 $3,500,000 $3,000,000

Currently, property tax receipts are $73,621 more than the 2014 receipts for the first nine months of the year, but will likely be short of the original budgeted amount of $4,850,000. Therefore, the budget for property tax was revised to $4,650,000. Although many citizens have received a notice of a substantial increase to their property valuations, the increased valuation relates to the collection of property tax for 2016.

$2,500,000 $2,000,000 $1,500,000 $1,000,000 $500,000 $0 Property Tax

09/30/2011 $4,594,045

Intergovernmental Revenues This category is made up of two revenue sources: Highway Users Trust Fund (HUTF), which is the City’s share of State-collected gas tax revenue, and Road and Bridge, which is the City’s share of property tax collected by Jefferson County and dedicated to the maintenance of roads and bridges. Combined, these revenues have averaged between $4.5 million and $4.7 million in the past five years and are budgeted for a little less than $4.7 million in 2015. Road and Bridge funds are disbursed quarterly. The graph shows the first two disbursements received, one in April and one in July. HUTF funds are received monthly and the graph shows eight months of revenue. While these funds have been a stable revenue source, they have increased less than 1% in the past three years. Both revenues sources are on pace to meet their budget.

09/30/2012 $4,457,676

09/30/2013 $4,532,720

09/30/2014 $4,565,024

09/30/2015 $4,638,645

2015 Budget $4,650,000

Intergovernmental Revenues $5,000,000 $4,500,000 $4,000,000 $3,500,000 $3,000,000 $2,500,000 $2,000,000 $1,500,000 $1,000,000 $500,000 $0 HUTF Jefferson County

09/30/2011 $2,528,738

09/30/2012 $2,549,159

09/30/2013 $2,539,390

09/30/2014 $2,600,435

09/30/2015 $2,695,921

2015 Budget $3,944,230

$754,282

$834,335

$701,103

$715,791

$720,750

$751,750

Jefferson County

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HUTF

Expenditure Highlights Ongoing expenditures rose 6% in 2015 over the same time period in 2014. The majority of the increase is made up of the purchase of the post office building at $1.11 million and the timing of the payment on the streets maintenance contract at $1.97 million. Personnel and other ongoing operating costs make up the rest of the difference, increasing at just over 3%. All of these items are in the budget for 2015. The transfer to the CIP fund, which makes up a majority of the Capital budget listed above, occurred in the third quarter 2015 versus the fourth quarter of 2014.

GENERAL FUND EXPENDITURES

Transfers 22%

Miscellaneous 2% Personnel 48%

Debt Service 1%

Contracts 13%

Supplies and Expenses 6%

Services and Charges 8%

Salary and Benefit Savings Salary & Benefits

2015 Budget

Salaries & Wages

$30,150,876

Vacancy Savings

As of 9/30/14

$19,716,205

$19,122,680

-

-

980,122

641,812

545,482

Group Insurance

6,036,792

3,744,563

3,486,183

Retirement

3,400,792

2,258,577

2,207,871

Medicare

374,106

250,418

232,997

Temporary Wages & SS

332,118

379,968

181,926

Other

359,185

255,471

249,096

$40,824,764

$27,247,015

$26,026,235

Overtime

Total

(809,226)

As of 9/30/15

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Temporary Wages were up significantly in the first nine months of 2015, due primarily to the use of independent contractors by Public Works to help manage Transit-Oriented Development projects currently underway, as well as substantial increases in contract pay for relief judges in the Municipal Court. Increases in General Fund Overtime expenditures were due to elevated charges in both Public Works and the Police Department.

Overview The Arvada Center Fund accounts for all revenues and expenditures related to performing arts, development, marketing, education and gallery at the Arvada Center.

Sources of revenue include grants, charges for services and transfers from the City’s General Fund.

Through the third quarter 2015, the Arvada Center continued to decrease expenses compared to 2014.

Total expenditures are down 7.3%. Revenue has also decreased 7.73% for the first nine months when compared to the first nine months of 2014. The Center is showing positive income through the third quarter even with the decrease in revenues. However, net income is $39,646 less than the first nine months of 2014. The fourth quarter is always the most difficult with so much competition for your entertainment dollars. It is estimated that the Center will finish the year with approximately $180,000 budget gap. Lower ticket revenues and fundraising shortfalls are the main contributors to this gap.

Arvada Center

2015 Budget

Beginning Fund Balance

As of 9/30/14

As of 9/30/15

$ 201,000

$ 201,000

$5,335,306

$3,419,858

$3,916,215

SCFD

1,029,553

833,656

768,407

City Cash Transfer

1,611,251

1,271,652

1,303,592

City In-Kind Transfer

2,225,881

-

-

$10,201,991

$5,525,166

$5,988,213

$7,819,253

$5,388,261

$5,811,662

REVENUES Generated

Total Revenues EXPENDITURES Ongoing In-Kind Total Expenditures

2,225,881

-

-

$10,045,134

$5,388,261

$5,811,662

156,857

136,905

176,551

Income/(Loss) Ending Fund Balance

$

357,857

$

337,905

Revenue Highlights Revenues decreased during the third quarter by 17.6% when compared to the third quarter of 2014. The largest contributor is the year-to-date decrease of 22% in ticket sales which is attributed to the cancellation of the summer musical. The summer musical has averaged $525,000 in revenue over the past five years. If you were to remove this revenue, year-over-year ticket sales would be flat. SCFD revenue, education classes, consignment art sales and Arts Day revenues have all seen increases in 2015, bringing the overall year-to-date revenue decrease to 7.73%.

Expenditure Highlights Compared to 2014, production costs decreased by approximately 22% from 2014. Expenses in Musical Theatre and Theatrical Plays have also decreased.

Marketing expenses decreased by 9% and Patron Services decreased by 13% when compared to 2014. These decreases can be attributed to a number of factors, but primarily are due to the cancellation of the summer musical in 2015 coupled with the evolving approach to play productions that require less expense through cast, design and labor.

Saturday Night Fever, The Musical Photo Credit P. Switzer Photogr aphy SEPT 2015

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ARVADA CENTER

Arvada Center

SCFD Revenue $1,200,000 $1,000,000 $800,000 $600,000 $400,000 $200,000 $SCFD

09/30/2011 $706,943

09/30/2012 $758,167

09/30/2013 $767,211

09/30/2014 $768,407

09/30/2015 $833,656

2015 Budget $1,029,553

The largest portion of the Scientific and Cultural Facilities District (SCFD) grant contributions was received in September. Currently, contributions are up 8.49% over 2014 and on track to meet the 2015 budget projection. The difficulty with projecting this grant revenue is that there is increased competition each year from other arts and cultural facilities. The Arvada Center continues to be the leader in the TIER 2 institutional category for funding.

City of Arvada Contributions $4,000,000 $3,500,000 $3,000,000 $2,500,000 $2,000,000 $1,500,000 $1,000,000 $500,000 $0 In-Kind Cash

09/30/2011 $1,475,453

09/30/2012 $1,573,123

09/30/2013 $1,587,997

09/30/2014 $1,530,000

09/30/2015 $1,669,411

2015 Budget $2,225,881

$886,982

$1,232,341

$1,232,341

$1,303,592

$1,271,652

$1,611,251

The City of Arvada increased the budget for its in-kind support of the Center in 2015 when compared to 2014 by $185,800. Budgeted cash support has remained level at $1,611,251, although additional cash contributions up to $400,000 have been made in 2012-2014.

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Parks Fund Overview The Parks Fund accounts for costs associated with the acquisition, design, development, maintenance and beautification of parks, open space and trails within the City.

Revenues are derived from the City’s General Fund, Grants Fund, Apex and Jefferson County Open Space funds.

Parks Fund Beginning Fund Balance

2015 Budget

As of 9/30/15

As of 9/30/14

$4,455,000

$4,455,000

$3,620,182

$2,232,455

$2,036,513

3,061,070

2,302,130

2,228,935

APEX Reimbursement

963,454

3,684

7,349

Other

213,076

221,421

213,130

$7,857,783

$4,759,690

$4,485,927

$8,169,022

$5,291,808

$5,125,862

-

-

-

$8,169,022

$5,291,808

$5,125,862

REVENUES Open Space City Cash Transfer

Total Revenues EXPENDITURES Ongoing Capital Total Expenditures Income/(Loss) Ending Fund Balance

(311,239) $4,143,761

(532,118)

(639,935)

$3,922,882

Revenue Highlights Jefferson County Open Space revenue, the largest source of income funding Arvada Parks operations, was almost 10% greater in 2015 compared to a similar period in 2014 and is representative of the robust growth in Jefferson County. All other revenue categories performed as expected - overall, a very strong quarter.

Expenditure Highlights

Arvada Reservoir Photo Credit Richard Assmus AUG 2013

Second quarter expenses are in line with previous year’s expenses for a similar time period. Griffith Station and Britton Parks were completed in the third quarter of 2015. Additional budget for the maintenance needs of these parks will be added to the 2016 budget.

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PARKS FUND

PARKS FUND

PARKS FUND REVENUE

Parks Fund Revenue $8,000,000 $7,000,000 $6,000,000 $5,000,000 $4,000,000 $3,000,000 $2,000,000 $1,000,000 $-

09/30/12 $2,541

09/30/13 $-

09/30/14 $7,349

09/30/15 $3,684

2015 Budget $938,454

Cash Transfer

$2,130,205

$2,106,033

$2,162,659

$2,228,935

$2,302,130

$3,061,070

Open Space

$1,789,135

$1,867,491

$1,689,316

$2,036,513

$2,232,455

$3,620,182

APEX

Kipling PED Crossing Photo Credit Richard Assmus SEPT 2015

09/30/11 $2,040

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Special Revenue Funds account for revenues that are to be used for specific purposes. The following funds are considered special revenue funds: • Tax Increment Funds • Community Development • Housing

Tax Increment Funds Overview There are two tax increment funds which account for the voter-approved sales tax increases to fund expanded police services. The first accounts for the .21 cent sales tax for police services and the second accounts for the .25 cent sales tax. Sources in the funds include sales tax, general use tax, auto use tax, building use and interest income.

Since the tax increment is in addition to the City’s 3% sales tax, revenue trends in the tax increment fund will closely follow those in the general fund.

.21 and .25 Tax Increment Funds Beginning Fund Balance

2015 Budget

As of 9/30/15

As of 9/30/14

$7,449,000

$7,449,000

$6,811,046

$4,657,051

$4,403,165

1,475,580

1,470,257

1,264,835

117,000

143,054

268,565

$8,403,626

$6,270,362

$5,936,565

$8,198,926

$5,285,482

$4,816,859

420,000

23,017

2,524,736

$8,618,926

$5,308,499

$7,341,595

REVENUES Sales Tax/Audit Revenue Use Tax Other Total Revenues EXPENDITURES Ongoing Capital Total Expenditures Income/(Loss)

(215,299)

Ending Fund Balance

$7,233,701

961,863

(1,405,030)

$8,410,863

Revenue Highlights Sales Tax in the third quarter of 2015 reflects an increase of 5.77%. A combination of Auto, Building and Public Improvement Use Taxes has increased $205,422, or 16.24% over the third quarter 2014. Overtime reimbursements, due to participation in programs such as BATTLE through the Colorado Automobile Theft Prevention Authority Board, Rocky Mountain Regional Computer Foresics Lab, and High Visibility Impaired Driving (HVE), have increased 3.86% or $36,730 in comparison to 2014. Transfers from Capital Projects and Federal Grant revenues have decreased 85.97%.

Expenditure Highlights In comparison to the same time period in 2014, salaries and benefits in the third quarter of 2015 have increased 8.74%. Combined, assignment and on-call pay increased over $41,000, with the 2015 approved policy change.

Shift differential pay, however, has decreased slightly at just under $1,500 during the same time period. Overtime saw an 28.51% increase, or $40,502 over third quarter 2014. With the completion of the comunity stations during the first quarter of 2014, Capital Expenditures continue to reflect a large decrease.

Arvada Police Officer Photo Credit Richard Assmus JUL 2013

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SPECIAL REVENUE FUNDS

Special Revenue Funds Overview

Community Development

Community Development Fund

2015 Budget

As of 9/30/15

The Community Development Fund accounts for all entitlements, revenues and expenditures of the Community Development Block Grants (CDBG) program and the Home Rehabilitation program and Essential Home Repairs program.

Beginning Fund Balance

$6,299,000

$6,299,000

$ 114,737

$ 146,401 $ 103,398

Revenue Highlights

City Cash Transfer

A few substantial deferred loan re-payments caused the uptick in Recovered Revenues, while the considerable drop in Grants Revenue was primarily a consequence of the timing of City drawdowns from HUD.

Expenditure Highlights

Ongoing

Overview

A drop in year-to-date expenditures on energy efficiency audits and improvements represents much of the overall decreases in Ongoing Expenditures. Last year’s Capital Project Transfer reflects payments for the renovation of the Memorial Neighborhood Park Revitalization project, which was completed in 2014.

As of 9/30/14

REVENUES Recovered Grants

668,001

245,778

402,574

45,000

33,750

33,750

Interest/Other

9,000

37,590

7,487

Total Revenues

$ 836,738

$ 463,519

$ 547,209

$ 624,727

$ 426,580 $ 488,564

EXPENDITURES Essential Home Repairs

392,044

197,099

213,369

Loans

-

-

80,000

Capital Proj. Transfer

-

-

170,077

$1,016,771

$ 623,679

$952,011

(180,033)

(160,160)

(404,802)

$6,118,967

$6,138,840

2015 Budget

As of 9/30/15

Total Expenditures Income/(Loss) Ending Fund Balance

Arvada Housing Authority Overview

The Authority administers funds received for rent subsidy to low/ moderate income households under Section 8 of the U.S. Housing Assistance Payment Program.

Revenue Highlights The substantial jump in Grants Revenue was primarily due to the timing of receipts from the US Department of Housing & Urban Development. It is worth noting that the spread between year-todate 2015 and year-to-date 2014 revenue has dropped from 43% at midyear to 18% through September 30th.

Expenditure Highlights As of September 30th, the Arvada Housing Authority was assisting 465 families with monthly rent subsidies out of a maximum 508.

These subsidies continue to constitute approximately 90% of the Fund’s expenditures. As with Grants Revenue, increased Rents Expenditures were due primarily to timing in the first half of the year.

The drop in client families is notable due to the current rental market.

Normally, when a family leaves the program, the Authority would fill the vacancy with another family. However, with drastic increases in rental costs, the AHA hasn’t been filling vacancies. Instead, it is using the cost savings to cover elevated costs for the remaining families in the program.

Arvada Housing Authority Beginning Fund Balance

$

16,000

$

16,000

$

19,178

$

12,273

As of 9/30/14

REVENUES Recovered Grants

$

18,139

3,939,000

2,976,810

2,518,163

82,400

50,000

50,000

Interest/Other

1,000

216

216

Total Revenues

$4,041,578

$3,039,299

$2,586,518

$ 381,443

$

267,185

$ 239,638

3,638,166

2,663,872

2,480,279

31,333

8,630

19,767

$4,050,941

$2,939,686

$2,739,684

(9,363)

99,613

(153,166)

6,637

$ 115,613

Transfers

EXPENDITURES Ongoing Rents Transfers Total Expenditures Income/(Loss) Ending Fund Balance

$

EOC ENERGY ASSISTANCE 2011-2015 through September - Dollars (Grants) $50,000

The City directly receives funding from Energy Outreach Colorado (EOC), a nonprofit corporation, and disburses it to low-income residents of Arvada as assistance with costs related to energy.

Total Dollars

$40,000 $30,000 $20,000 $10,000 $0 Series1

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2011 $40,972

2012 $45,500

2013 $32,462

2014 $33,242

2015 $34,256

58th & Allison Street Resurface Photo Credit Ryan Adler AUG 2015

The Capital Improvement Projects Fund is where the City keeps track of capital projects for streets, traffic, parks and the Arvada Center.

Capital Projects Capital Improvement Fund

2015 Budget

As of 9/30/15

As of 9/30/14

Beginning Fund Balance

$ 38,551,182

$ 38,551,182

REVENUES

$ 7,528,952

$ 10,439,536

$ 2,114,681

CIP Administration

$ 10,011,960

$ 4,795,173

$ 5,010,676

CIP Street Projects

1,181,090

592,031

1,040,443

CIP Traffic Projects

2,269,479

1,291,992

1,524,139

CIP Park Projects

2,807,848

3,191,981

3,593,713

50,000

249,571

248,973

$16,320,377

$ 10,120,748

$11,417,944

EXPENDITURES

CIP Arvada Center Total Expenditures Income/Loss Ending Fund Balance

(8,791,425)

$318,788

$ 29,759,757

$ 38,869,970

(9,303,263)

Revenue Highlights In 2015, the majority of the revenue in the CIP Fund consists of transfers from the General Fund and Lands Dedicated Fund. The revenues also include a one-time transfer of $3,106,046 from the General Fund for the Olde Town Transit Hub and $90,000 for improvements to 82nd and Simms approved in the carry-over ordinance in March.

Expenditure Highlights Expenditures in the third quarter include costs for Britton and Griffith parks, park renovation projects, the Kipling underpass, traffic signal maintenance and the Olde Town Transit Hub.

13

CAPITAL IMPROVEMENT PROJECTS FUND

Capital Improvement Projects (CIP) Fund Overview

Project Highlights With a fund balance of over $38 million, there are many capital improvement projects happening in the City. While the new projects generally get most of the attention, there are projects that fall into the “Taking Lasting Care” category. These projects are equally important because we need to make sure that we take care of the City’s existing infrastructure. Playgrounds and traffic signals will be the focus of the third quarter Capital Improvement fund with additional details provided below.

Playground Renovation: With 64 parks in the City of Arvada, it is a priority to make sure that we keep the parks maintained and safe for the citizens that visit these parks. In 2015, there are three parks that are undergoing a complete renovation. Meadowlake Park, Oak Park and Jack B. Tomlinson Park have all new playground equipment and refurbished site furnishings, including benches, picnic tables and trash receptacles. The City will spend almost $700,000 to renovate these three parks. Meadowlake and Oak Parks have been completed and Jack B. Tomlinson Park will open in late October.

Sidewalk Replacement R alston Road Photo Credit Ryan Adler OCT 2015

Sidewalk Replacement R alston Road Photo Credit Ryan Adler OCT 2015

Traffic Signal Maintenance: This project will reconstruct 5 of the City’s 112 traffic signals to modernize outdated equipment. New equipment will provide increased functionality including new cabinets, uninterruptible power supply (UPS) backup, traffic signal indications, detections systems and communication capabilities which are currently lacking. Construction will also include new structural equipment including new traffic signal poles, pedestrian signal poles and mast arms. Minor striping and sidewalk improvements with ramp modifications are also included. A total of $851,000 will be spent on the following traffic signals: • West 64th Avenue and Quay Street • West 55th AVenue and Marshall Street • West 64th Avenue and Carr Street • West 55th Avenue and Saulsbury Court • 57thAvenue immediately west of Zephyr Street

14

Overview The Water Fund accounts for all activities within the scope of the water utility operations including administration, operations, capital water projects, financing and related debt service and billing and collection.

Water Fund Beginning Fund Balance

2015 Budget

As of 9/30/14

As of 9/30/15

$71,970,000

$71,970,000

$20,700,210

$11,558,516

$12,808,614

Tap Fees

8,329,106

7,035,678

5,663,693

Interest

329,438

240,334

187,239

Other

698,449

1,445,203

1,459,514

$30,057,203

$20,279,731

$20,119,060

$17,744,709

$12,144,174

$10,854,847

Debt Service

2,261,700

-

-

Major Capital Maintenance

4,087,564

2,723,816

3,187,542

Capital

5,058,656

1,549,641

1,021,453

$29,152,629

$16,417,631

$15,063,843

904,574

3,862,099

5,055,217

$72,874,574

$75,832,099

REVENUES Water Charges

Total Revenues EXPENDITURES Ongoing

Total Expenditures Income/(Loss) Ending Fund Balance*

Revenue Highlights

Arvada Reservoir Photo Credit Richard Assmus JUNE 2014

Revenues from Water Charges were down 9.8% through the first nine months of the year, with consumption down 22.3% due to prolonged stretches of wet weather earlier in the year.

The difference between revenues and consumption was due to the timing of utility cycle batch postings. Tap Fees continued to pour in, reflecting ongoing substantial residential building activity.

Expenditure Highlights A majority of the increase in Ongoing Expenditures was due to the timing of a raw water payment to Denver Water and an increase in professional service expenses. The decrease in Major Capital Maintenance Expenditures was due to the timing of annual expenditures. The increase in Capital expenditures was due to work extending the City’s water system northwest to accommodate growth. Debt Service will be paid out in the fourth quarter. *$37,298,909 of the Fund Balance is a cash escrow reserved in Denver Water’s name for the Gross Reservoir expansion.

15

ENTERPRISE FUNDS

Water Fund

Water Consumption This chart, with data provided by Utilities, shows water consumption through September by year since 2011.

Thousands of Gallons

WATER CONSUMPTION As of September 4,500,000 4,000,000 3,500,000 3,000,000 2,500,000 2,000,000 1,500,000 1,000,000 500,000 -

1000s of Gallons

2011 3,386,517

2012 4,261,633

2013 3,536,589

2014 3,438,791

2015 2,671,070

This chart shows water tap fee revenue through September by year since 2011.

Dollars

WATER FUND - TAP FEES As of September $7,200,000 $6,400,000 $5,600,000 $4,800,000 $4,000,000 $3,200,000 $2,400,000 $1,600,000 $800,000 $Tap Fees

2011 $1,683,340

2012 $2,662,486

2013 $5,075,958

16

2014 $5,663,693

2015 $7,035,678

Wastewater Fund Overview The Wastewater Fund accounts for all activities necessary in the collection, transmission and disposal of sewage and wastewater.

WasteWater Fund

2015 Budget

As of 9/30/15

$13,048,000

$13,048,000

$12,401,341

$7,746,218

$7,665,501

Tap Fees

555,211

777,170

546,327

Interest

128,674

82,806

72,310

Other

612,581

481,474

442,833

$13,697,807

$9,087,668

$8,726,971

$7,832,149

$5,874,112

$5,535,546

Ongoing

3,140,527

2,025,518

1,993,995

Major Capital Maintenance

2,720,762

1,771,024

593,844

Beginning Fund Balance

As of 9/30/14

Revenue Highlights Sewer Tap Fee Revenues remain high due to robust residential construction. Sewer Charges for 2015 are on pace to meet budget and are slightly ahead, 1%, over 2014.

REVENUES Sewer Charges

Total Revenues EXPENDITURES Metro District

Capital Total Expenditures

501,500

-

-

$14,194,938

$9,670,653

$8,123,384

Income/(Loss)

(497,131)

Ending Fund Balance

$12,550,869

(582,985)

Expenditure Highlights Treatment charges from the Metro Wastewater Reclamation District represented three-fifths of Total Expenditures through the first nine months of the year. The jump in Major Capital Maintenance Expenditures was due to the timing of payments on contract work.

603,586

$12,465,015

Wastewater Tap Fees This chart shows sewer tap fee revenue through September by year since 2011.

Dollars

WASTEWATER FUND - TAP FEES As of September $800,000 $720,000 $640,000 $560,000 $480,000 $400,000 $320,000 $240,000 $160,000 $80,000 $0 Tap Fees

2011 $152,845

2012 $356,045

2013 $555,486

17

2014 $546,327

2015 $777,170

Stormwater Fund Overview The Stormwater Fund accounts for all activities necessary to maintain a stormwater management plan.

Stormwater Fund Beginning Fund Balance

2015 Budget

As of 9/30/15

As of 9/30/14

$5,565,000

$5,565,000

$3,326,374

$2,424,310

$2,342,044

32,341

52,313

193,410

$3,358,715

$2,476,623

$2,535,454

$2,056,716

$958,604

$855,707

933,288

699,966

699,600

1,635,000

1,660

1,104,096

Total Expenditures

$4,625,004

$1,660,229

$2,659,403

Income/(Loss)

(1,266,289)

Ending Fund Balance

$4,298,711

REVENUES Stormwater Fee Other Total Revenues EXPENDITURES Ongoing Debt Service Capital

816,394

(123,949)

$6,381,394

Revenue Highlights The City’s Stormwater Utility Fee rate rose by 2% as of the beginning of 2015, the first increase since 2009.

Expenditure Highlights The drop in Capital Expenditures was due to the absence of payments on the Garrison Street Bridge Replacement and related Ralston Creek channelization, which were wrapping up in early 2014. The increase in Ongoing Expenses was due to the timing of payments on miscellaneous drainage projects.

Hills at Standley Lake Garden Photo Credit Richard Assmus M AY 2014

18

Golf Fund Overview The Golf Course Fund accounts for all revenues and expenses of the Lake Arbor and West Woods Golf Courses, including food service operations.

Revenue Highlights

Golf Fund

After a challenging second quarter, with its unprecedented rains and subsequent negative impact on golf, rounds played roared back in the third quarter.

Strong play, especially at West Woods Golf Club, boosted golf-related revenue from 5% down compared to 2014, to 2% up. West Woods Golf Club tournament rounds were up 30% in the third quarter and up 69% in September alone, compared to 2014, a result of a new tournament recruitment and a later aeration date which opened up the booking inventory. Rounds played at Lake Arbor Golf Club did not post the same results as West Woods Golf Club still down 10% for the year. Golf Restaurant revenue is 7% greater this year compared to year-to-date 2014. This was, overall, a very strong quarter.

2015 Budget

As of 9/30/15

$ 207,000

$ 207,000

Golf Courses

$3,489,178

$2,694,170

$2,625,535

Restaurants

1,228,929

1,235,407

1,158,278

215,759

174,156

157,106

$4,933,866

$4,103,733

$3,940,919

Golf Courses

$2,210,629

$1,532,435

$2,129,957

Restaurants

1,340,870

1,168,517

1,030,602

Administration

1,298,272

954,835

237,785

241,000

7,813

-

$5,090,770

$3,663,600

$3,398,344

(156,904)

440,133

542,575

$50,096

$647,133

Beginning Fund Balance

As of 9/30/14

REVENUES

City Cash Transfer Total Revenues EXPENDITURES

Capital Total Expenditures

Expenditure Highlights Third quarter expenses are in line with projections.

Income/(Loss) Ending Fund Balance

Westwoods

Variance

2014

2015

28,580

29,829

1,249

4%

Super Users Annuals

6,042

6,866

824

14%

Tournament

4,304

4,816

512

12%

486

678

192

40%

39,412

42,189

Player Support

Grow the Game Total

Lake Arbor

2,777

7%

Variance

2014

2015

Player Support

19,878

17,578

(2,300)

-12%

Super Users Annuals

13,417

11,841

(1,576)

-12%

Tournament

716

901

185

26%

Grow the Game

373

496

123

33%

34,384

30,816

Total

(3,568)

-10%

19

West Woods Golf Club Photo Credit Richard Assmus M AY 2014

Golf Rounds by Type - January - September

Hospitality Fund Overview The Hospitaliuty Fund accounts for all revenue and expenses associated with food service activities including the operation of banquet facilities at the Arvada Center for the Arts and Humanities and offsite catering.

Revenue Highlights Overall, Arvada Hospitality income posted a modest increase in the third quarter 2015 compared to a similar period in 2014.

Although the Arvada Center and In-house Markets have continued to decrease each year (a decline of $63,000 annually over the past 5 years), the Association, Government, Religious, and Corporate segments have been maintained or increased. Through the third quarter, year-to-date performance has also increased, compared to 2014, in the Social, Government, and Wedding markets. The Education market continues to be at risk with budgetary constraints and re-evaluation of meeting dollars spent. All other revenue categories performed as expected.

Expenditure Highlights Total expenses are approximately 3% below 2014 levels and within established margins. Large capital expeditures, related to replacing aging equipment, have been placed on hold pending the results of the hospitality feasibility study.

Hospitality Fund Beginning Fund Balance

2015 Budget

As of 9/30/15

As of 9/30/14

$ 602,000

$ 602,000

$1,032,380

$

REVENUES Sales

517,686

$

438,299

Concession Services

192,444

135,873

138,422

Banquet and Guest Services

614,514

331,454

403,998

Total Revenues

$1,839,338

$

985,013

$

980,718

$

$

226,672

$

220,376

EXPENDITURES Administration Operations

724,055 1,296,310

651,541

686,117

Capital

-

-

-

Transfer to General Fund

-

-

20,601

Total Expenditures

$2,020,365

Income/(Loss)

$

(181,027)

Ending Fund Balance

$

420,973

878,214 106,800

$

$

927,094 53,624

708,800

Taste of Arvada Photo Credit Richard Assmus NOV 2012

20

We have five Internal Service Funds – Insurance Fund (Risk Management), Computer Fund, Print Services Fund, Vehicles Fund and Building Fund. Internal Service Funds charge internal programs and departments for use of goods and services. The Funds then pay for all associated costs of things such as purchasing insurance, vehicle purchases and maintenance, computer purchases and maintenance, and buildings maintenance.

Insurance Fund Overview The Insurance Fund, administered by the Risk Management Program of Finance, accounts for the City’s self-insurance against loss. It is funded with contributions by all City departments and programs based on their levels and types of exposure. The Fund is also used for loss prevention programs, the protection of City personnel and the preservation of City property and assets.

Insurance Fund Beginning Fund Balance

2015 Budget

As of 9/30/15

As of 9/30/14

$4,065,000

$4,065,000

$1,817,992

$1,363,642

$1,524,655

72,120

65,690

65,820

$1,890,112

$1,429,332

$1,590,475

$2,126,669

$1,519,498

$1,242,416

426,889

302,102

283,709

$2,553,558

$1,821,600

$1,526,124

REVENUES Contributions Other Total Revenues EXPENDITURES Risk Mgmt Administration Risk Mgmt Operations Total Expenditures Income/(Loss) Ending Fund Balance*

(663,446) $3,401,554

(392,268)

64,351

$3,672,732

Revenue Highlights The reduction in Contributions Revenue was due to a 28% cut in charges for operations, which was hastened by the move of two City Attorney’s Office FTEs from the Insurance Fund to the General Fund. Charges for lines of coverage - Workers Compensation, General Liability, Auto Liability, Property, and Auto Physical - remained generally unchanged.

Expenditure Highlights Increases in claims expenses included a jump in Auto Physical claims due to a hail storm earlier in the year and settlements for General Liability claims stemming from a water main break in December 2014.

*Per GASB Statement 10, an additional $1,269,963 in cash is currently held in the Risk Management Fund to cover potentially incurred liabilities as of the beginning of the year. This figure was reached by Risk Management’s actuary for 2014.

21

INTERNAL SERVICE FUNDS

Internal Service Funds Overview

Computer Fund & Print Services Fund Overview The Computer Fund provides resources for both ongoing maintenance and replacement of the City’s computers, network hardware, and other electronic infrastructure. It is funded with contributions by all City divisions based on their levels of use of this technology. The Print Services Fund provides ongoing capital support for the City’s printing needs. Because these two funds operate to support combined activities within the Information Technology Department, the financial reporting is combined for these two funds.

Computer Fund/ Print Services Fund

2015 Budget

As of 9/30/15

$6,240,000

$6,240,000

Maintenance

$ 950,006

$ 715,072

$ 719,734

Replacement

961,061

777,360

729,282

Print Shop

464,463

294,356

243,744

$2,375,530

$1,786,787

$1,692,759

Maintenance

$1,072,121

$ 603,729

$ 604,916

Replacement

2,323,213

487,441

500,075

450,581

242,747

284,706

$3,845,915

$1,333,917

$1,389,697

452,870

303,062

Beginning Fund Balance

As of 9/30/14

REVENUES

Total Revenues EXPENDITURES

Print Shop Total Expenditures Income/(Loss)

(1,470,385)

Ending Fund Balance

$4,769,615

$6,692,870

Revenue Highlights Revenues in the Maintenance and Replacement funds are on track as budgeted for 2015. In planning for 2016 we are seeing an increase in maintenance costs for some technologies that are priced based on capacity or performance. These will be worked into future budget plans.

The Print Shop revenue is a little behind budget but should not be an issue as we are keeping pace with expenditures.

Expenditure Highlights Most expenditures are on track in the Maintenance and Replacement funds. Some replacement expenditures may get pushed into 2016. We are performing a longer evaluation process in order to effectively evaluate the proper replacement products. Some existing maintenace expenses have increased as the pricing model on certain systems (ie. backup software) is based on the performance capability of the hardware.

These systems are in the process of being evaluated to determine if they are still appropriate for our changing environment. The Print Shop expenditures are below budget with no major changes expected between third quarter and the end of the year.

22

Vehicles Overview

Revenue Highlights

The Vehicles Fund provides resources for the maintenance of City vehicles and heavy equipment and/or replacement. It is funded with contributions by all City divisions based on their vehicle inventory and use.

Charges for Vehicle Maintenance services, which include personnel costs, rose 3% over 2014 levels. Charges for Vehicle Replacement contributions rose 1% over 2014 levels. Gains from the sale of retired units were the source of the increase in Other Revenues.

Vehicles Fund Beginning Fund Balance

2015 Budget

As of 9/30/15

$6,247,000

$6,247,000

As of 9/30/14

Expenditure Highlights

REVENUES Maintenance Transfers

$2,321,122

$1,740,841

$1,690,139

Replacement Transfers

1,130,947

848,210

839,813

144,378

269,103

125,072

$3,596,447

$2,858,155

$2,655,023

Maintenance

$3,056,258

$1,712,819

$1,462,576

Replacement

1,725,440

1,117,351

1,213,289

Total Expenditures

$4,781,698

$2,830,170

$2,675,865

Income/(Loss)

(1,185,251)

Ending Fund Balance

$5,061,749

$6,274,985

2015 Budget

As of 9/30/15

$2,368,000

$2,368,000

$ 446,814

$ 335,111

$ 323,476

136,312

133,700

130,096

$ 583,126

$ 468,810

$ 453,572

Replacement

$ 588,615

$

$

Capital Lease

120,918

86,526

$ 709,533

$ 108,015

Other Total Revenues EXPENDITURES

27,985

(20,842)

The rise in Maintenance Expenditures reflects both increased outlays for parts and fuller staffing of Fleet operations through the first nine months of 2015 versus 2014. Additionally, Fleet in January began keeping some personnel on-call during winter weather months to better ensure staff availability to service plow vehicles. This change will cost the Vehicles Fund approximately $25,000 a year.

Budgeted Maintenance Expenditures include $500,000 for the construction of a new storage building at the Indiana Shops, which will include a police weapons testing range. Construction remains delayed and may be pushed out to 2016. There are currently 19 units up for replacement in 2015.

Buildings Building Fund Beginning Fund Balance

As of 9/30/14

REVENUES Replacement Transfers Other Total Revenues EXPENDITURES

Total Expenditures Income/(Loss) Ending Fund Balance

(126,407) $2,241,593

21,489

360,796

536 85,398

$

85,934 367,637

$2,728,796

23

Overview The Buildings Fund provides resources for maintaining major portions of facility infrastructure as replacement becomes necessary. The primary types of infrastructure are HVAC equipment, parking lots, roofs, and carpet. It is funded with contributions by all City divisions based on their facility occupancy.

Revenue Highlights Monthly replacement charges from contributing funds were generally increased by 3% for 2015, having been frozen since 2009.

Expenditure Highlights The Capital Lease Expenditures represent payments per an agreement with Siemens Building Technologies in 2004 for energy efficiency improvements at various City facilities. The term of this lease expires in 2016. Several HVAC replacements scheduled for the past couple of years are being deferred to 2016 in order to exploit better pricing with economies of scale. This represents the difference in the yearly budget and the current actual expenditures.

Arvada Economic Development Association (AEDA) Overview AEDA was established to encourage and stimulate all forms of economic development – commercial and industrial. The services provided by AEDA benefit both the City and citizens by providing information and services to existing and prospective businesses and industries. Funding for AEDA consists of compensation from the City for services it renders the City and its citizens. The City also provides administrative support for AEDA. A Board of Directors appointed by City Council governs AEDA. 2015 Budget

Beginning Fund Balance

$475,577

$475,577

Revenue

790,879

595,318

585,046

Expenditures

784,897

485,042

521,780

$481,559

$585,853

Ending Fund Balance

As of 9/30/15

As of 9/30/14

Operations

Revenue Highlights Revenue in the AEDA Operations Fund consists of a transfer from the general fund equal to the personnel and operating expenditures.

Expenditure Highlights Year-to-date expenditures in 2015 are at 62% of budgeted expenditures and are slightly less than 2014 expenditures. Salaries and benefits represent the largest expenditure at approximately 54% of the total expenditures.

Beginning Cash Balance Revenue Expenditures

9/30/2015 $579,836 790,614 (504,897)

Ending Cash Balance

865,553

Reserved for Job Creation Program

(18,000)

New Entrepreneur Program

(19,500)

Arvada Manufacturing Initiative

(5,400)

Commitments

(464,201)

Available Unallocated Cash Balance

$358,452

Revenue Highlights

Photo Credit Richard Assmus

Program

Revenues in 2015 consist of a cash contribution from the City of Arvada for $500,000, repayments from two loans and interest income.

Expenditure Highlights Expenditures in 2015 reflect 26 AEDA small business grants and one loan. The grants are used to help Arvada businesses improve signage, landscaping, facades and site improvements.

24

TOD Olde Town Station Photo Credit Ryan Adler SEPT 2015

Pursuant to the City’s investment policy, the primary objectives of the City’s investment activities, in priority order are safety, liquidity and yield.

Consistent with this policy, the portfolio of securities is invested in US Treasuries, US Agency debt, local government investment pools (LGIP’s), commercial paper, and corporate debt subject to rating and concentration limits. The City’s investment portfolio is managed to provide sufficient liquidity to meet all reasonably anticipated operating cash needs without selling securities prior to maturity.

Investment Portfolio Overview The annualized yield on the City’s investment portfolio in the third quarter of 2015 was 0.751%, which is an increase of almost 10 basis points (bps) in comparison with the third quarter of 2014. The City’s portfolio has been consistently performing above the composite benchmark yield, which is calculated as a weighted average yield of relative securities of the same or similar class and maturity as in our portfolio. The year-to-date benchmark yield for the third quarter of 2015 was 0.570%. Overall, we can see a very modest but steady improvement in the City’s portfolio performance over the last few years but the rates are still anchored by the Federal Reserve’s near-zero target interest rate policy. There has been a lot of volatility in the market lately caused by uncertainty surrounding the global slowdown of growth (particularly in China) and the timing of the Federal Reserve’s first move to raise interest rates. The spreads over Treasuries have widened a little especially in the corporate debt sector. But good quality corporate bonds are hard to come by. The City’s investment portfolio increased by $10 million compared to the same time last year, which was primarily allocated to US Agencies. The balance in our savings and money market accounts were reduced to a minimum, since they only pay 3-6 bps. We have been keeping a large balance in our checking account to offset monthly banking fees. Now that the interest rates on LGIPs have been going up and currently yield 20 bps, we moved cash out of the checking account into LGIP funds to maximize the return on idling cash. During the third quarter of 2015 the portfolio saw only $18.6 million in calls. When reinvesting, we continue to focus on the shorter term securities and take advantage of longer term step-up bonds (with preset increases in coupon rate as the bonds approach maturity) to minimize the interest rate risk. Key information regarding the City’s portfolio is shown in the following tables and graphs:

25

CITY OF ARVADA INVESTMENT REPORT

Investment Portfolio Objectives

PORTFOLIO PERFORMANCE 09/30/2015 $940,590 0.751% 0.570% +18bps

YTD Interest Earnings Portfolio Yield Benchmark Yield Tracking Error

PORTFOLIO CHANGES 09/30/2015 $114,706 3,977,773 15,066,381 5,995,000 33,676,986 127,000,000 $185,830,846

Money Market Savings/ Cash CD Corporate LGIP US Agency Total

09/30/2014 $774,488 0.653% 0.420% +23bps

Difference $166,102 0.098% 0.150% -5bps

09/30/2014 $1,013,670 12,498,356 15,151,772 5,995,000 25,199,385 115,725,000 $175,583,183

Difference $(898,964) (8,520,583) (85,391)

ACCOUNT SUMMARY Par Value $185,830,846 Book Value $185,831,327 Market Value $185,960,021 Unrealized Gain/(Loss) $ 129,175

8,477,602 11,275,000 $10,247,663

PORTFOLIO ALLOCATION US Agency, 68.4%

PORTFOLIO CHARACTERISTICS Average Duration (yrs) 1.85 Average Coupon 0.837% Average Cost YTM 0.935% Average Market YTM 0.901%

LGIP, 18.1%

Corporate, 3.2%

MATURITY DISTRIBUTION 30.0% 25.0%

27.4%

24.1%

21.3%

20.0% 15.0%

10.5%

9.7%

10.0%

7.0%

5.0% 0.0%

0-.25

.25-1

1-2

Maturity (yrs)

26

2-3

3-4

4-5

Money Market, 0.1% CD, 8.1% Savings/ Cash, 2.1%

City of Arvada Investments as of September 30, 2015 The City’s portfolio as of September 30, 2015 is shown below, which includes credit ratings as of September 30, face value and actual interest earnings for 2015.

Description

CUSIP/Ticker

Credit Rating 09/30/2015

Coupon Rate

Maturity Date

Ending Face

Interest

Amount/Shares

Dividends

SAVINGS/CHECKING JPMorgan Chase Savings

CHASE

N/A

0.03%

N/A

146,646

80

Wells Fargo Savings

WELLSFARGO

N/A

0.06%

N/A

136,275

214

0.30%

N/A

3,694,851

-

3,977,773

294

JP Morgan Checking Sub Total Savings/Checking CERTIFICATE OF DEPOSIT Vectra Bank

5791396061

N/A

0.55%

06/25/2016

5,025,145

13,913

Vectra Bank

5791396079

N/A

0.55%

06/25/2016

5,025,145

13,913

Vectra Bank

5791396095

N/A

0.55%

07/07/2016

1,007,320

2,320

Vectra Bank

5791396103

N/A

0.65%

08/29/2016

1,002,193

2,193

Vectra Bank

5791396111

N/A

0.65%

08/29/2016

1,002,193

2,193

Vectra Bank

5791396129

N/A

0.65%

08/29/2016

1,002,193

2,193

Vectra Bank

5791396137

N/A

0.65%

08/29/2016

1,002,193

2,193

15,066,381

38,917

Sub Total Certificate Of Deposit CORPORATE Apple, Inc

037833AH3

AA1

0.45%

05/03/2016

1,410,000

3,173

Exxon Mobil

30231GAA0

AAA

0.92%

03/15/2017

1,500,000

13,815

Berkshire Hathaway

084664BX8

AA2

0.95%

08/15/2016

3,085,000

29,308

5,995,000

46,295

Sub Total Corporate LOCAL GOVERNMENT INVESTMENT POOL C Safe LGIP

CSAFE

AAAm

0.19%

N/A

10,919,539

12,495

Colo Trust LGIP

COLOTRUST8001

AAAm

0.20%

N/A

17,847,323

13,177

Colo Trust LGIP

COLOTRUST8004

AAAm

0.20%

N/A

174,065

216

Colo Trust LGIP

COLOTRUST8008

AAAm

0.20%

N/A

4,554,990

5,123

Colo Trust LGIP

COLOTRUST8010

AAAm

0.20%

N/A

Sub Total Local Government Investment Pool

181,069

536

33,676,986

31,547

114,706

822

114,706

822

MONEY MARKET CSIP MM

CSIP

AAAm

0.15%

N/A

Sub Total Money Market US AGENCY FFCB 0.33 11/13/2015

3133ED7L0

AAA

0.33%

11/13/2015

5,000,000

8,250

FFCB 0.6 11/21/2016-13

3133EC3M4

AAA

0.60%

11/21/2016

3,000,000

9,000

FFCB 0.64 5/9/2017-14

3133ECP40

AAA

0.64%

05/09/2017

5,000,000

16,000

FFCB 1.09 2/26/2018-15

3133EEP46

AAA

1.09%

02/26/2018

6,000,000

16,350

FFCB 1.18 2/13/2018-15

3133EEK41

AAA

1.18%

02/13/2018

5,000,000

14,750

Chart continues next page

27

Description

CUSIP/Ticker

Credit Rating 09/30/2015

Coupon Rate

Maturity Date

Ending Face

Interest

Amount/Shares

Dividends

FFCB 1.41 3/1/2019-15

3133EFBP1

AAA

1.41%

03/01/2019

5,000,000

-

FFCB 1.6 9/23/2019-16

3133EFEL7

AAA

1.60%

09/23/2019

5,000,000

-

FFCB 1.73 8/12/2019-16

3133EE6U9

AAA

1.73%

08/12/2019

3,000,000

-

FFCB 1.98 6/29/2020-16

3133EE2S8

AAA

1.98%

06/29/2020

3,000,000

-

FHLB 0.6 4/24/2017

313382TR4

AAA

0.60%

04/24/2017

5,000,000

15,000

FHLB 0.75 3/27/2017-14

313382HT3

AAA

0.75%

03/27/2017

5,000,000

37,500

FHLB 0.75 8/15/2017-13

313382W25

AAA

0.75%

08/15/2017

5,000,000

18,750

FHLB 0.8 4/17/2017-13

313380U88

AAA

0.80%

04/17/2017

3,000,000

12,000

FHLB 1 1/29/2018-16

3130A5UN7

AAA

1.00%

01/29/2018

5,000,000

-

FHLB 1.05 5/30/2018

3130A5UU1

AAA

1.05%

05/30/2018

3,000,000

-

FHLB 2.125 12/28/2015

3133727K4

AAA

2.13%

12/28/2015

2,000,000

21,250

FHLB Step 11/20/2019-15

3130A3EG5

AAA

1.25%

11/20/2019

5,000,000

31,250

FHLB Step 4/30/2018-14

313382T78

AAA

1.00%

04/30/2018

3,000,000

9,375

FHLB Step 7/27/2018-15

3130A5UR8

AAA

0.50%

07/27/2018

5,000,000

-

FHLMC 0.65 12/23/2016-14

3134G56W0

AAA

0.65%

12/23/2016

5,000,000

16,250

FHLMC 0.7 4/28/2017-16

3134G6UC5

AAA

0.70%

04/28/2017

4,000,000

-

FHLMC 0.85 6/23/2017-15

3134G7ET4

AAA

0.85%

06/23/2017

3,000,000

-

FHLMC 1.15 12/26/2017-14

3134G5A21

AAA

1.15%

12/26/2017

5,000,000

28,750

FHLMC 1.25 3/22/2018-15

3134G7CQ2

AAA

1.25%

03/22/2018

5,000,000

15,625

FHLMC 1.25 5/25/2018-16

3134G6L76

AAA

1.25%

05/25/2018

5,000,000

-

FHLMC Step 7/22/2019-15

3134G7EQ0

AAA

1.50%

07/22/2019

5,000,000

-

FHLMC Step 8/17/2018-15

3134G7MU2

AAA

1.00%

08/17/2018

4,000,000

-

FHLMC Step 9/30/2020-16

3134G7XN6

AAA

1.25%

09/30/2020

5,000,000

-

FNMA 1.15 4/30/2018-15

3136G2G84

AAA

1.15%

04/30/2018

5,000,000

-

Subtotal Agency

127,000,000

270,100

Totals

185,830,846

387,975

Investment Management Focus - 2015 2015 continues to be a struggle for the capital markets as the Federal Reserve has kept interest rates low, which will likely continue through 2015. We will continue to monitor the two items of focus we have highlighted below.

Diversification of Maturities: We will continue to keep LGIP and cash and savings balances at levels to meet operating and capital needs. We will focus on a blended strategy which calls for emphasis in short-term positions as well as some long-term positions (5 years in the City’s case), but also staggering maturities in between to smooth the revenue stream. This will allow ample cash should the City experience unexpected needs, allow us to take advantage of better coupons in longer maturity buckets and the ability to capitalize on investment opportunities if/when yields begin to recover.

Agency spreads are tighter, callables will get better yield: Call provisions are a tool used by issuers to refinance debt at a more attractive rate. Our focus will be to purchase callable securities with a call “lockout” period of six months or more to enhance investment income over the LGIP funds, which are currently yielding 20bps.

28

TOD Hub Site Photo Credit Ryan Adler OCT 2015

Finance Department • 8101 Ralston Road • Arvada, Colorado 80002 720-898-7120 • www.arvada.org Contributors: Bryan Archer, Director of Finance Lisa Yagi, Assistant Director of Finance Ryan Adler, Budget Analyst Deanne Gibboney, Budget Analyst Debra Nielson, Controller Arlene Martinez, Executive Assistant Vesta Weinhauer, Treasury Analyst