2014 city 1q report issuu by City of Arvada

2014 First Quarter

Financial Report

Table of Contents Overview........................................................... 1 General Fund................................................... 2 Arvada Center.................................................. 7 Parks Fund....................................................... 8 Special Revenue Funds.................................. 9 Capital Improvements Fund.........................11 Enterprise Funds...........................................12 Internal Service Funds..................................18 City of Arvada Investment Report............... 22

overview

2014 First Quarter The revenue story for the General Fund continues to be positive. Sales tax revenues for the first quarter 2014 are up over 3.7% compared to the 2013. Restaurants are the story with fast-casual, fast-food and sit-down restaurants all up over 2013. Public Utilities have also seen an increase in 2014, up 6.5%. This revenue source is impacted the most by the weather, and the first quarter of 2014 was colder with more snow than the first quarter 2013. Building revenues are similar to 2013 with over $1.5 million in receipts. There were 105 single-family permits issued, an increase of 12 over 2013 and more than all of 2008 or 2009. The Candelas and Leyden Rock developments are leading the way. It is difficult to trend an entire year off of one quarter, but the signs are pointing to a positive revenue environment for 2014.

Restaurant revenues are the story the first quarter of 2014, with fast-casual, fast-food and sit-down restaurants all up over 2013.

The Capital Projects Fund has just under a $45 million fund balance. There are some very large projects planned for the upcoming years including the garage and pedestrian bridge in Olde Town, collector street improvements, quiet zones, traffic lights and safety improvements. The City has made a major commitment to capital and infrastructure improvements and this will continue for the foreseeable future. Water Revenues are down 13% and consumption is down 11% compared to 2013. Further analysis is being completed on the nature of the drop but the first quarter is a small percentage of the total budgeted revenues. Reservoirs are full, so the hope is that there will not be water restrictions, at least early, in 2014. Tap fees are up due to the increase in building activity. These revenues will be used for future capital needs. The Golf Fund hopes the first quarter trend continues. Rounds and golf revenues are up at West Woods along with revenues in the restaurant. Even with the wet winter, there were 10 more playable days in first quarter 2014 compared to the same period in 2013. The increase in the restaurants can also be attributed to the remodel that was completed in the first quarter of 2013. Internal service funds have kept their rates the same for 2014. These rates are sufficient to cover current expenditures and planned replacements. The major replacements budgeted for 2014 include desktop/laptop computers, food bank parking lot and the final order of the new Ford Interceptors. First quarter results rarely tell the story for the entire year but it is nice to be off to a positive start!

GENERAL FUND

General Fund Overview The General Fund pays for the City’s basic services. This includes police, street maintenance, planning, transportation planning, 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 • Transferto the Capital Improvements 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. The General Fund began 2014 with a $25,675,000 fund balance. Some of this fund balance, $3,008,076, was dedicated to 2013 carryover and one-time items. An additional $3,150,000 of one-time 2013 funds was added to the Capital Fund for Gold Line TOD improvements. Removing these items, revenue and expenditure budgets are in balance for 2014.

General Fund

2014 Budget

As of 03/31/14

As of 03/31/13

Beginning Fund Balance

$25,675,000

Revenues

$71,572,813

$13,157,024

$12,627,685

70,514,872

12,503,510

11,445,551

EXPENDITURES Ongoing

Capital 6,908,690 In general, revenues are in line with or exceeding the 2014 JPPHA 200,000 200,000 200,000 budget estimates for the majority of revenue categories. $77,623,562 $12,703,510 $11,645,551 The major revenue categories of sales tax, use tax, Total Expenditures Income/(Loss) (6,050,749) 453,514 982,134 property tax, building and intergovernmental revenues are discussed in more detail in the “Revenue Highlights” Ending Fund Balance $19,624,251 $26,128,514 section. The investment report at the end of this report 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 2015. Expenditures in 2014 rose 9% over 2013. The comprehensive plan and the use of outside consultants for building and plan reviews make up the majority of this increase. Personnel and other ongoing operating costs make up the difference, increasing at just over 3%. All of these items are in the budget for 2014.

GENERAL FUND REVENUE

Sales Tax 49%

Property Tax 6%

Use Tax 2%

Auto Use Tax 7% Other 20% Franchise Fees 6%

Interest 1%

Building Use Tax & Permits 7%

Court Fines & Fees 2%

Revenue Highlights First Quarter building revenues are slightly down in 2014 from the previous year, which is mostly due to a series of condominium permits and the remodeling of an assisted living facility. The figures for 2014 represent greater overall building activity in Arvada, and are not as heavily influenced by large, particular construction projects in the City.

General Fund Building Revenue through March

108

$1,800,000

$1,600,000

$1,400,000

Dollars

$1,200,000

$1,000,000

$800,000 36

$600,000

$400,000

$200,000 $0 GF Building Revenue Single Family (Detached) Permits

2010 $979,527

2011 $664,651

2012 $965,674

2013 $1,549,612

2014 $1,519,817

105

Sales Tax Sales tax collections in the first quarter still show an increase over the first quarter in 2013, but not quite at the rate that we saw last year. Sales tax collections lag one month; therefore, collections for the first quarter represent sales tax collections for only two months.

Sales Tax Collections $7,000,000

$6,000,000

$5,000,000

$4,000,000

$3,000,000

$2,000,000

$1,000,000

03/31/10 $5,252,127

Sales Tax

03/31/11 $5,335,005

03/31/12 $5,620,783

03/31/13 $6,051,902

03/31/14 $6,279,068

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. Construction in Arvada continues the trend from 2013. Although building use tax decreased from the first quarter of 2014, this quarter is the second strongest first quarter in the past ten years. Based on the current activity, we do expect building use tax to exceed the budget for 2014. In addition, automobile purchases still appear to be strong. After four consecutive years of increased auto use tax, the first quarter of 2014 auto use tax is 7.7% more than the first quarter of 2013. General use tax is a stable source of revenue that does not have the up and down swings that we see in building and auto use tax.

Use Tax Collections

$1,800,000 $1,600,000 $1,400,000 $1,200,000 $1,000,000 $800,000 $600,000 $400,000 $200,000 $General

03/31/10 $201,609

03/31/11 $172,091

03/31/12 $172,571

03/31/13 $179,830

03/31/14 $164,311

Auto

$546,932

$614,803

$699,804

$806,298

$868,221

Building

$350,394

$259,116

$494,072

$764,557

$667,925

Property Tax Although property tax accounts for less than 7% of General Fund revenues, property tax is a stable revenue source for the City. The City maintains one of the lowest property tax rates in the Denver Metro Area with a mill levy of 4.31. In Colorado, the mill is placed on the assessed valuation.

Property Tax Collections $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 $Property Tax

03/31/10 $1,500,684

03/31/11 $1,361,462

03/31/12 $1,723,913

03/31/13 $1,611,945

03/31/14 $1,608,708

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. Road and Bridge funds are disbursed several months after collection, so January revenues will not be received until April. HUTF funds are disbursed the month after they are collected, so the graph represents two months’ revenue.

INTERGOVERNMENTAL REVENUES $630,000 $620,000 $610,000 $600,000 $590,000 $580,000 $570,000 $560,000 $550,000 $540,000 $530,000

03/31/10

03/31/11

03/31/12

03/31/13

03/31/14

$563,952

$593,804

$609,840

$602,577

$621,173

Jefferson County HUTF

GENERAL FUND EXPENDITURES Miscellaneous 1%

Transfers 18%

Debt Service 5% Personnel 50%

Contracts 10%

Supplies and Expenses 7% Services and Charges 9%

Revenue Highlights

Salary and Benefit Savings Salary & Benefits Salaries & Wages

2014 Budget

As of 03/31/14

$28,879,080

As of 03/31/13

$5,079,935

$5,003,233

Vacancy Savings

(782,730)

Overtime

940,502

211,174

154,155

Group Insurance

5,179,173

909,887

833,012

Retirement

3,292,954

590,919

584,910

Medicare

343,436

61,165

58,837

Temporary Wages & SS

533,949

47,573

52,872

Other

365,968

81,394

83,295

$38,752,332

$6,982,047

$6,770,313

Total

The greatest year-over-year increase among Personnel Expenditures was found in Overtime, due primarily to a greater need for snow plowing in the first three months of 2014. The Streets Divisionâ€™s Overtime costs more than doubled from $38,372 to $80,316.

ARVADA CENTER

Arvada Center Revenue Highlights Ticket Sales experienced a decrease of $25,346 or 4.6% in the first quarter compared to the same time period in 2013. The Glass Menagerie and End of the Rainbow did not meet their revenue estimates and sold fewer tickets than their comparable shows from 2013. The Mousetrap, presented in the Black Box theater, was the most successful show for that venue in the past seven years. SCFD revenues decreased 1.8% or $5,009 compared to 2013. This was the case even though the overall tax base has increased. With more competition being added to Tier 2, this will continue to be our experience until the reauthorization process in 2016. Education revenues were up $11,836 or 5.44%. Dance Academy program attendance increased by almost 125 students for the winter session.

Expenditure Highlights Total expenditures are down 8% in the first quarter of 2014 compared to the same time period last year. This reduction was due to cost-control measures in the Performing Arts productions. Net savings for the three winter shows was $140,618. The difference in total savings was an increase to payroll due to the hiring of the Development Manager.

Arvada Center

2014 Budget

As of 03/31/14

$ 232,000

$6,282,791

$821,334

$826,740

1,096,970

278,277

283,286

City Cash Transfer

1,643,122

410,780

City In-Kind Transfer

2,040,000

$11,062,883

$1,510,391

$1,520,806

Ongoing

$9,112,374

$1,430,855

$1,545,117

In-Kind

2,040,000

$11,152,374

$1,430,855

$1,545,117

Beginning Fund Balance

As of 03/31/13

REVENUES Generated SCFD

Total Revenues EXPENDITURES

Total Expenditures Income/(Loss)

(89,491)

Ending Fund Balance

142,509

79,536 $ 311,536

(24,311)

PARKS FUND

PARKS FUND Parks Fund Parks Fund

2014 Budget

As of 03/31/14

$4,301,000

$3,514,740

$272,892

$261,769

2,971,913

742,978

720,886

APEX Reimbursement

954,810

6,015

Other

187,848

60,520

25,282

$7,629,311

$1,082,406

$1,007,937

$7,881,273

$1,134,992

$1,160,220

$7,881,273

$1,134,992

$1,160,220

Beginning Fund Balance

As of 03/31/13

REVENUES Open Space City Cash Transfer

Total Revenues

Revenue Highlights

EXPENDITURES

There are four major revenue categories in the parks fund. All are performing as expected during the first quarter.

Capital Total Expenditures

Expenditure Highlights Parks fund expenditures are approximately 2% below 2013 expenditures through the first quarter. To date, expenditures have been as anticipated in the budget with nothing unexpected occurring.

PARKS FUND REVENUE

Ongoing

Income/(Loss) Ending Fund Balance

(251,962) $4,049,038

(52,586) $4,248,414

$1,200,000 $1,000,000 $800,000 $600,000 $400,000 $200,000 $-

03/31/10

03/31/11 Open Space

03/31/12 Cash Transfer

03/31/13 APEX

03/31/14

(152,283)

SPECIAL REVENUE FUNDS

Special Revenue Funds Overview 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.

Revenue Highlights The US Department of Justice disbursed their 2013 JAG award in the amount of $16,721 to be used for the purchase of tasers. The 2014 JAG process for request for application was also opened and we will begin that process during the second quarter of this year. We continue to recover costs from additional grants for programs such as Enforcing Underage Drinking Laws (EUDL), a Federal grant; Rocky Mountain High Intensity Drug Trafficking Association (HIDTA), a State grant; and also a donation from the Arvada Elks Lodge #2278 from their Drug Awareness Committee. Programs such as B.A.T.T.L.E. through the Colorado Automobile Theft Prevention Authority Board and the Rocky Mountain Regional Computer Forensics Lab continue to provide reimbursement for overtime.

Expenditure Highlights The West Woods and Lake Arbor community police stations experienced their grand opening in late February. Since becoming operational in March we are now begining to see increases in needs and requests from the community. Each station is staffed with approximately 30 sworn and 3 civilian employees. A number of community meetings are being held at each location and our community rooms are booked frequently. Feedback from the community about both the building and the concept is overwhelmingly postive. In February, the Arvada Police Department was reaccredited by CALEA. This law enforcement accreditation program exemplifies the Arvada Police Department’s excellence in public saftey standards. Additionally, as of March 2014, there are only 3 vacant Police Officer positions, with 5 Recruits currently enrolled in the Police Academy slated for graduation in June 2014. There have been 5 sworn retirements in the first quarter of 2014.

.21 and .25 Tax Increment Funds

2014 Budget

As of 03/31/14

$7,980,000

$6,415,140

$997,077

$968,415

1,311,541

260,840

269,107

117,000

85,466

42,418

$7,843,681

$1,343,383

$1,279,940

Ongoing

$7,525,559

$1,301,028

$1,314,194

Capital

3,344,728

1,428,518

106,729

$10,870,287

$2,729,546

$1,420,922

Beginning Fund Balance

As of 03/31/13

REVENUES Sales Tax/Audit Revenue Use Tax Other Total Revenues EXPENDITURES

Total Expenditures Income/(Loss) Ending Fund Balance

(3,026,606) $4,953,394

(1,386,163) $6,593,837

(140,982)

Community Development Community Development Fund Beginning Fund Balance

2014 Budget

Arvada Housing Authority

As of 03/31/14

Arvada Housing Authority

As of 03/31/13

Beginning Fund Balance

$6,896,000 $6,896,000

As of 03/31/14

As of 03/31/13

$195,000

$19,178

$7,346

$4,078

3,900,000

905,825

965,342

26,000

49,846

Revenues

Revenues Recovered

2014 Budget

Recovered $114,737

$34,197

$156,539

668,000

10,797

45,266

Transfers

City Cash Transfer

45,000

11,250

Interest/Other

5,464

238

Interest/Other

19,500

2,162

2,164

Total Revenues

$3,950,642

$913,257

$1,019,504

Total Revenues

$847,237

$58,407

$215,219

$430,579

$71,247

$81,426

3,532,200

774,109

1,078,520

30,420

4,688

10,855

$3,993,199

$850,044

$1,170,800

Income/(Loss)

(42,557)

63,214

(151,296)

Ending Fund Balance

$152,444

$258,214

Grants

Expenditures

Expenditures Ongoing

Ongoing $1,111,628

$68,512

$171,940

380,625

66,232

63,372

Loans

Capital Project Transfer

64,123

$1,492,253

$198,867

$235,312

(645,016)

(140,460)

(20,094)

$6,250,984

$6,755,540

Essential Home Repairs

Total Expenditures Income/(Loss) Ending Fund Balance

Rents Transfers Total Expenditures

Revenue Highlights The absence of Transfers Revenue for 2014 is due to timing adjustments made to accommodate ever-evolving changes in federal reporting requirements.

Revenue Highlights

Expenditure Highlights

The decline in Recovered Revenues versus 2013 was due to a one-time, $150,000 repayment last year on a promissory note for a 2010 loan made to the JeffCo Housing Authority for repairs and upgrades to the Parkview Village Apartments.

The Arvada Housing Authority currently assists 477 families with monthly rent subsidies. These subsidies constituted approximately 89% of the Fundâ€™s expenditures thus far in 2014. The apparent drop in Rents is solely a function of timing adjustments made to better accommodate federal reporting requirements.

Expenditure Highlights The timing of the City Cash Transfer to the Arvada Housing Authority represents most of the year-over-year decrease in Ongoing Expenditures. This was caused by changes in the federal reporting practices and $57,042 provided to Family Tree for housing and family emergency supportive services, both in 2013. This yearâ€™s Capital Project Transfer reflects payments for the ongoing work to complete the renovation of the Memorial Neighborhood Park Revitalization project.

EOC ENERGY ASSISTANCE 2010-2014 through March - Dollars (Grants)

Total Dollars

$10,000

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.

$8,000 $6,000 $4,000 $2,000 $0 Dollars

2010 $4,388

2011 $9,002

2012 $9,287

2013 $6,972

2014 $9,007

CAPITAL iMPROVEMENT FUND

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

Revenue Highlights In 2014, the revenue in the CIP Fund consists of transfers from the General, Lands Dedicated and Water Funds. The revenues will also include a one-time transfer of $3,150,000 from the General Fund for the Gold Line parking structure.

Expenditure Highlights The fund balance in the Capital Improvement Projects Fund continues to accumulate monies for new infrastructure projects such as the parking structure along the Gold Line, Britton and Griffith parks and the Van Bibber underpass. There are also monies set aside for ongoing projects that include signal replacement, collector street improvements, ADA ramps, intersection safety improvements, quiet zones and sidewalk and trail gaps. Current expenditures reflect charges for projects started in 2013 that include replacement of the police radio system and video security equipment at the Arvada Center. Work on Ralston Central Park is continuing in 2014 and should be completed in the second quarter. Expenditures in the first quarter also include the purchase of land needed to expand the plaza at the Olde Town station and water taps for Maverick Mesa and Churchâ€™s Crossing parks.

Capital Projects Capital Improvement Fund Beginning Fund Balance

2014 Budget

As of 03/31/14

As of 03/31/13

$44,830,000

$4,358,690

$803,523

$219,780

CIP Administration

$1,974,070

$2,995,792

$281,484

CIP Street Projects

422,000

145,437

60,718

CIP Traffic Projects

3,026,382

142,549

85,766

790,230

929,046

355,830

51,500

110,228

32,032

$6,264,182

$4,323,052

$815,830

Revenues Expenditures

CIP Park Projects CIP Arvada Center Expenditures Income/Loss Ending Fund Balance

(1,905,492) $42,924,508

(3,519,529) $41,310,471

Work on Ralston Central Park should be completed in the second quarter 2014.

(596,050)

enterprise funds

Enterprise Funds Overview Enterprise funds account for activities that generate a fee that makes the entity self supporting. The five enterprise funds in the City are the Water Fund, the Wastewater Fund, the Stormwater Fund, the Golf Fund and the Hospitality Fund.

Water Fund

Expenditure Highlights

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

Four million dollars of 2013 Ongoing Expenditures represented a payment to Consolidated Mutual for water rights in the JCMD, which was covered by a payment to the City from JCMD in January 2013. The timing of the annual transfers of Parks Water Tap and Irrigation System Revenues, as well as the payment of annual water rights assessments, round out the bulk of differences in Ongoing Expenditures between the first quarters of 2013 and 2014. Increases in both Major Capital Maintenance and Capital Expenditures are due to the timing of annual expenditures.

Revenue Highlights Revenues from Water Charges were down 13.3% for the first quarter, with consumption down 11.0% over the same period in 2013. Utilities is reviewing and monitoring both revenue and consumption data to identify the full nature of the drops. Tap Fees continued to be sold at an incredible pace, reflecting both continued substantial building activity and the purchase of three substantial irrigation taps for developer-constructed parks in northwest Arvada. The significant year-over-year drop in Other Revenues was due to a four-million dollar pass-through payment in 2013 related to water rights acquisition received from the Jefferson Center Metropolitan District (JCMD). The drop in Interest Revenue is due to a lower fund balance because of the Cityâ€™s down payment on the Gross Reservoir Expansion project currently held in escrow.

Tap Fees continued to be sold at an incredible pace, reflecting both continued substantial building activity and the purchase of three substantial irrigation taps for developer-constructed parks in northwest Arvada.

Water Fund Water Fund Beginning Fund Balance

2014 Budget

As of 03/31/14

As of 03/31/13

$73,767,000

$20,026,271

$2,299,237

$2,651,864

Tap Fees

4,835,189

1,559,970

1,309,849

Interest

266,645

65,138

112,448

Other

682,972

561,975

4,323,525

$25,811,077

$4,486,321

$8,397,685

$16,845,528

$3,229,162

$6,536,186

Debt Service

2,260,700

Major Capital Maintenance

4,065,596

887,370

591,728

Capital

4,096,356

370,426

$27,268,180

$4,486,959

$7,127,915

REVENUES Water Charges

Total Revenues EXPENDITURES Ongoing

Total Expenditures Income/(Loss) Ending Fund Balance

(1,457,103) $72,309,897

(638) $73,766,362

1,269,770

Water Consumption This chart, with data provided by Utilities, shows first quarter water consumption since 2010.

WATER CONSUMPTION

Thousands of Gallons

As of March

800,000 700,000 600,000 500,000 400,000 300,000 200,000 100,000 -

1000s of Gallons

2010 712,368

2011 658,633

2012 680,612

2013 699,889

2014 623,164

Water Tap Fees This chart shows annual water tap fee revenue since 2010.

WATER FUND - TAP FEES As of March

$1,600,000

Dollars

$1,200,000 $800,000 $400,000 $Tap Fees

2010 $269,977

2011 $585,481

2012 $418,267

2013 $1,309,849

2014 $1,559,970

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

Wastewater Fund WasteWater Fund

Revenue Highlights

2014 Budget

As of 03/31/14

$15,014,000

$11,730,087

$2,274,034

$2,308,845

Tap Fees

380,403

117,951

153,953

Interest

633,620

23,735

21,282

Other

594,738

8,575

$13,338,848

$2,424,295

$2,455,773

$7,500,000

$1,845,182

$1,805,748

Ongoing

3,128,500

596,321

547,056

Major Capital Maintenance

1,961,852

13,300

193,560

204,600

$12,794,952

$2,454,803

$2,546,364

Beginning Fund Balance

As of 03/31/13

REVENUES Sewer Charges

Total Revenues

(28,308)

EXPENDITURES Metro District

Capital Total Expenditures Income/(Loss) Ending Fund Balance

543,896 $15,557,896

(30,507)

Sewer Tap Fee Revenues, while below 2013â€™s record level, remain at a historically high level due to continued residential construction. The purchase of three park irrigation taps caused a divergence in sewer taps from water taps.

Expenditure Highlights Treatment charges from the Metro Wastewater Reclamation District represented about three-fourths of Total Expenditures in the first quarter. The majority of the 9% increase in Ongoing Expenditures was due to higher personnel costs.

(90,591)

$14,983,493

WASTEWATER FUND - TAP FEES As of March

Wastewater Tap Fees

$160,000

This chart shows annual sewer tap fee revenue since 2010.

Dollars

$120,000 $80,000 $40,000 $0 Tap Fees

2010 $23,184

2011 $40,265

2012 $71,369

2013 $153,953

2014 $117,951

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

Stormwater Fund Stormwater Fund Beginning Fund Balance

2014 Budget

As of 03/31/14

$8,048,000

$3,147,497

$732,783

28,031

13,265

$3,175,528

$746,049

As of 03/31/13

REVENUES Stormwater Fee Other Total Revenues

$723,609 (6,208) $717,401

EXPENDITURES Ongoing Debt Service Capital

$2,062,029 932,800

$283,191 233,200

$316,059 233,122

5,415,414

176,010

196,011

Total Expenditures

$8,410,243

$692,401

$745,192

Income/(Loss)

(5,234,715)

Ending Fund Balance

$2,813,285

53,647

(27,791)

$8,101,647

Revenue Highlights The Cityâ€™s Stormwater Utility Fee Revenue, which represents nearly all revenue for the Stormwater Fund, came in consistent with 2013 levels. The rate for the Stormwater Utility Fee has not changed since 2009.

Expenditure Highlights The drop in Ongoing Expenditures was due to a series of bad debt writeoffs in 2013. Capital Expenditures thus far in 2014 include final bills for the Garrison Street Bridge Replacement and related Ralston Creek channelization, as well as initial work on flood threat mitigation in the wake of last yearâ€™s significant flooding.

Golf Fund Golf Fund

2014 Budget

As of 03/31/14

As of 03/31/13

Beginning Fund Balance

$105,000

Golf Courses

$3,383,085

$347,451

$277,040

Restaurants

1,193,135

186,733

146,305

209,475

52,369

50,324

$4,785,695

$586,553

$473,668

Golf Courses

$2,395,843

$320,309

$338,712

Restaurants

1,258,466

201,294

162,044

Administration

938,500

298,133

299,876

Capital

103,000

4,262

285,578

$4,695,809

$823,998

$1,086,210

REVENUES

City Cash Transfer Total Revenues EXPENDITURES

Total Expenditures Income/(Loss) Ending Fund Balance

89,886

(237,445)

$194,886

$(132,445)

(612,541)

Revenue Highlights There are two major revenue categories in the Golf Fund: Golf revenues and Golf restaurant revenues. Green fee revenue is up 25% in 2014 compared to 2013, most notably due to 10 more playable days in March, 2014 at West Woods Golf Course. The 2014 green fee increases had minimal effect on revenue as first quarter is still a discount fee season and carts are restricted to cart path only. Golf restaurant revenue is up approximately 28% compared to 2013 due to increased levels of business this year compared to last year. The 2014 restaurant price increases had minimal effect on revenue as they went into effect March 1st.

Expenditure Highlights Golf Fund expenditures are 24% less in 2014 compared to 2013. In 2013, the public areas of the West Woods Clubhouse and Lake Arbor Restaurant were remodeled which accounts for the difference. Turf conditions coming into the spring are better in 2014 compared to 2013 because of minimal winter kill and cart path-only restrictions in place throughout the winter.

Golf Rounds by Type - January thru March 2014 WEST WOODS

Regular

Special

Tournament

Annual

Senior

Junior

Other

Total

2013

1,389

410

1,935

2014

889

1,027

855

346

3,259

889

-362

445

284

1,324

-26%

109%

458%

325%

47%

68%

LAKE ARBOR

Regular

Special

Tournament

Annual

Senior

Junior

Other

Total

2013

992

1,015

2,212

153

4,426

2014

715

1,163

2,138

219

4,367

-277

148

-74

-9

-59

-28%

15%

-3%

-17%

43%

-1%

Hospitality Fund Hospitality Fund

2014 Budget

As of 03/31/14

As of 03/31/13

Beginning Fund Balance

$558,000

$1,002,311

$154,146

$158,071

Concessions

176,994

15,875

16,476

Miscellaneous

523,074

95,547

73,132

Total Revenues

$1,702,378

$265,568

$247,679

$298,178

$55,032

$46,423

1,291,653

183,840

200,246

263,000

27,468

6,887

6,488

$1,880,299

$245,759

$253,158

REVENUES Banquets

EXPENDITURES Administration Operations Capital Transfer to General Fund Total Expenditures Income/(Loss) Ending Fund Balance

(177,920) $380,080

19,809

(5,479)

$577,809

Revenue Highlights Overall, first quarter revenue in 2014 was 7% greater than in 2013, with 2,000 more guests and an additional 11 groups served. By market segment: the Arvada Center in-house market share saw a reduction in revenue due to the Centerâ€™s decision to utilize outside catering for events; the corporate market rebounded in the first quarter with an increase of $30,000 in revenue; and the association market remained steady in the number of groups, guests and revenue generated. All other market segments were similar to 2013 activity levels.

Expenditure Highlights Hospitality Fund expenditures are approximately 3% below 2013 expenditures through the first quarter. To date, expenditures have been as anticipated in the budget with nothing unexpected occurring.

First quarter revenue was 7% greater than the same period in 2013, with 2,000 more guests and additional 11 groups served.

INTERNAL SERVICE funds

Internal Service Funds Overview We have four Internal Service Funds. These Funds charge for goods and services to each division that uses them. 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.

Risk Management Risk Management Fund Beginning Fund Balance

2014 Budget

As of 03/31/14

As of 03/31/13

$4,506,000

2,032,528

508,218

502,587

70,019

32,356

5,184

$2,102,547

$540,575

$507,771

Revenues Transfers Other Total Revenues

Risk Mgmt Operations Total Expenditures Income/(Loss) Ending Fund Balance

The Insurance Fund, administered by the Risk Management Division of Finance, provides the means by which the City self-insures against loss. It is funded with contributions by all City divisions based on their levels and types of exposure. The Fund is also used for programs for loss prevention, the protection of City personnel and the preservation of City property and assets.

Revenue Highlights

Expenditures Risk Mgmt Administration

Overview

$1,993,796

$306,583

$226,508

645,062

137,179

134,108

$2,638,858

$443,762

$360,616

96,813

147,155

(536,311) $3,969,689

$4,602,813

Contributions by participating Funds generally remain at 2013 levels.

Expenditure Highlights Year-over year increases for the first quarter in claims expenses for Workers Compensation and Property Insurance, though partially offset by a drop in General Liability Expenses, comprise the vast majority of increases in Administration Expenditures. *Per GASB Statement 10, an additional $807,882 in cash is currently held in the Risk Management Fund to cover potentially incurred liabilities as of the beginning of the year.

Information Technology and Print Services Information Technology Fund

2014 Budget

As of 03/31/14

As of 03/31/13

Beginning Fund Balance

$6,191,000

Maintenance

$959,787

$239,911

$239,942

Replacement

899,054

279,139

289,596

Print Shop

450,935

56,453

78,975

$2,309,776

$575,503

$608,512

Maintenance

$1,171,777

$205,733

$284,888

Replacement

949,250

252,805

151,829

Print Shop

501,610

51,522

78,583

$2,622,637

$510,060

$515,299

65,444

93,213

Revenues

Total Revenues Expenditures

Total Expenditures Income/(Loss) Ending Fund Balance

(312,861) $5,878,139

$6,256,444

Expenditure Highlights Primary expenditures from the Replacement Fund are for the desktop/laptop replacement program that has been scheduled within the first six months of 2014. Approximately 210 machines were replaced in the first quarter and an additional 250 will be replaced during the second quarter. The maintenance expenses for the first quarter have been primarily for the Radio Replacement Project, Golf Course Point-of-Sale System, and the Oracle Financial System. Print Shop expenditures will spike in the second quarter of 2014 as we pay for this new replacement equipment. This expenditure will likely cause the Print Shop to operate at a loss in 2014; however, we will still have a positive fund balance.

Overview The Computer Fund provides resources for both ongoing maintenance and replacement of the Cityâ€™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 Shop Fund provides ongoing capital support for the Cityâ€™s printing needs.

Revenue Highlights Revenues for the Technology Replacement and Maintenance Funds have been held static for the last few years. Due to recent technology changes in 2013, a revenue analysis will be completed to ensure that future maintenance and replacement levels will continue to be maintained. Print Shop revenues continue to remain steady in the first quarter of 2014, but with the replacement of the high-speed copier, color copier and all convenience copiers City-wide, we will be adjusting chargeback rates starting in 2015 to keep the fund healthy.

Vehicles Vehicles Fund

2014 Budget

As of 03/31/14

$6,309,000

Maintenance Transfers

$2,262,414

$563,380

$549,145

Replacement Transfers

1,115,772

279,938

278,943

116,579

93,614

12,546

$3,494,765

$936,931

$840,634

Maintenance

$2,071,728

$388,512

$522,171

Replacement

1,972,400

98,133

$83,677

$4,044,128

$486,645

$605,848

450,286

234,786

Beginning Fund Balance

As of 03/31/13

Revenues

Other Total Revenues Expenditures

Total Expenditures Income/(Loss) Ending Fund Balance

(549,363) $5,759,637

$6,759,286

2014 Budget

As of 03/31/14

$2,145,000

$431,165

$107,825

134,721

120,808

$565,886

$228,633

Overview The Vehicles Fund provides resources for the maintenance of City vehicles and heavy equipment, as well as their replacement when various factors demand their retirement. It is funded with contributions by all City divisions based on their vehicle inventory and use.

Revenue Highlights Charges for Fleet Maintenance services, which include personnel costs, rose 3% over 2013 levels. For the City as a whole, Vehicle Maintenance transfers remain roughly at 2013 levels.

Expenditure Highlights The conspicuous drop in year-over-year Maintenance Expenditures is due to drops in first quarter spending in a number of line items, including Inventory and Repair & Maintenance - Vehicles. However, it is too early in the year to declare a trend for the rest of 2014.

Buildings Building Fund Beginning Fund Balance

As of 03/31/13

Revenues Replacement Transfers Other Total Revenues

$101,838 (363) $101,475

Expenditures Replacement

$366,681

Capital Lease Total Expenditures Income/(Loss) Ending Fund Balance

$34,556

117,396

27,840

27,304

$484,077

$27,840

$61,861

81,809

200,793

39,614

$2,226,809

$2,345,793

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 remained at 2013 levels. The small increase is due to both PD Tax Increment Funds beginning to pay into the Fund for future replacements at the Lake Arbor and West Woods Community Stations. The leap in Other Revenues was solely due to the timing of transfers from various Funds for annual Capital Lease payments.

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. Activity scheduled for 2014 includes the replacement of the Arvada Community Food Bank parking lot.

Arvada Economic Development Association Operations Beginning Fund Balance

2014 Budget

As of 3/31/14

As of 3/31/13

$396,890

Revenue

775,000

197,196

182,306

Expenditures

766,881

167,424

169,267

$405,009

$426,662

Ending Fund Balance

Program

2014

Beginning Cash Balance

$875,781

Revenue

1,133

Expenditures

(15,676)

Ending Cash Balance

861,238

Reserved for AEDA Loan Program

(300,000)

Reserved for AEDA Small Business Grants

(150,000)

Reserved for Job Creation Program

(23,500)

Reserved for New Entrepreneur Program

(19,500)

Commitments

(209,325)

Available Unallocated Cash Balance

$158,913

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 2014 are at 22% of budgeted expenditures and are comparable to 2013 expenditures. Salaries and benefits represent the largest expenditure at approximately 45% of the expenditures.

Revenue Highlights Revenues in 2014 consist of interest income.

Expenditure Highlights Expenditures in 2014 reflect three AEDA small business grants. The grants were used to help Arvada businesses improve signage, landscaping, facades, and site improvements.

Investment Portfolio Objectives 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.

CITY OF ARVADA INVESTMENT REPORT

Investment Portfolio Overview The portfolio saw a year-to-date first quarter 2014 yield of .599% which is an increase of 5bps when compared to the year-to-date first quarter 2013 yield of .548%. The benchmark yield for the City’s portfolio, as established by the investment policy, is a weighted benchmark of allowable securities. For the first quarter, the weighted benchmark return was .31%, constructed using the average 2014 monthly returns. The City’s portfolio yield continued to decline from the previous rolling four quarters, as evidenced by the considerable reduction in investment income and the unfavorable reinvestment environment. One contributing factor to these performance results is that the Fed has left rates at very low levels. The discount rate remains at .25% and the Federal Reserve has announced that we will continue to experience these rates most likely into 2015. The Federal Reserve will keep rates unchanged until the dynamics of our economy significantly change. The portfolio saw $20 million in investment calls during the first quarter due to the expiration of call “lockout” periods. These calls have resulted in reinvestment in lower-yielding securities which contributes to the reduction in investment income. Balances in LGIP funds have decreased due to the $36 million funding of an escrow account for the Denver Water Project during the third quarter of 2013. We are keeping a balance in our checking account due to the fact that the City earns .30% earnings credit on balances in our accounts. This earnings credit offsets monthly banking fees and is higher than the current LGIP rates of .10%. Keeping this balance in our checking account reduces our banking fees but will allow us to quickly invest these funds as interest rates recover. Key information regarding the City’s portfolio is shown in following tables and graphs: PORTFOLIO PERFORMANCE

PORTFOLIO CHANGES

03/31/2014

03/31/2013

Difference

03/31/2014

03/31/2013

Difference

Interest Earnings

$246,725

$303,680

-$56,955

Money Market

$1,013,210

$5,006,842

-$3,993,632

Portfolio Yield

0.599%

0.600%

0.001%

Savings/Cash

21,140,670

20,163,693

976,977

Benchmark Yield

0.313%

0.370%

-0.057%

17,284,936

19,270,465

-1,985,529

Tracking Error

+29bps

+23ps

+7ps

5,995,000

5,000,000

995,000

17,465,038

36,468,439

-19,003,401

100,600,000

108,000,000

-7,400,000

2,000,000

7,000,000

-5,000,000

$165,498,854

$200,909,439

-$35,410,585

Corporate LGIP

PORTFOLIO ALLOCATION

US Agency

Money Market, 0.6%

U.S. Agencies, 60.9%

US Treasury Total

ACCOUNT SUMMARY LGIP, 10.5%

Savings/ cash, 12.0%

CD, 10.5%

U.S. Treasuries, 1.2%

28.1%

$165,498,377

Market Value

$164,944,251

PORTFOLIO CHARACTERISTICS Average Duration (yrs)

18.1%

20.0% 15.0% 7.4%

10.3%

8.5%

5.0% 0.0% 0-.25

Book Value

-$554,603

27.6%

25.0%

10.0%

$165,498,854

Unrealized Gain/(Loss)

MATURITY DISTRIBUTION 30.0%

Par Value

.5-1

1-2

2-3

3-4

4-5

Maturity (yrs)

2.03

Average Coupon

0.581%

Average Cost YTM

0.666%

Average Market YTM

0.746%

City of Arvada Investments as of March 31, 2014 The Cityâ€™s portfolio as of March 31, 2014 is shown below, which includes credit ratings as of March 31, face value and actual interest earnings for 2014. Description Savings/Checking

JPMorgan Chase Savings Wells Fargo Savings

CUSIP/Ticker

Credit Rating

Coupon

Maturity

Ending Face

Interest

12/31/2013

Rate

Date

Amount/Shares

Dividends

CHASE

N/A

0.05%

N/A

5,545,797.22

332.72

WELLSFARGO

N/A

0.13%

N/A

5,033,991.92

1,380.36

N/A

0.30%

N/A

10,560,881.04

0.00

21,140,670.18

1,713.08

JP Morgan Checking Sub Total Savings/Checking Certificate Of Deposit FIRSTBANK

CD7273

N/A

0.25%

05/27/2014

2,005,078.17

0.00

FIRSTBANK

CD7281

N/A

0.30%

12/02/2014

5,136,394.11

3,755.84

FIRSTBANK

CD8679

N/A

0.60%

05/05/2014

5,093,001.53

7,421.02

FRISTBANK

CD5343

N/A

0.30%

07/29/2014

Sub Total Certificate Of Deposit

5,050,461.82

3,693.00

17,284,935.63

14,869.86

1,410,000.00

0.00

Corporate Apple, Inc

037833AH3

AA1

0.45%

05/03/2016

Exxon Mobil

30231GAA0

AAA

0.92%

03/15/2017

1,500,000.00

Berkshire Hathaway

084664BX8

AA2

0.95%

08/15/2016

3,085,000.00

14,653.75

5,995,000.00

14,653.75

16,020,011.05

1,620.11

Sub Total Corporate Local Government Investment Pool C Safe LGIP Colo Trust LGIP

CSAFE

AAAm

0.10%

N/A

COLOTRUST8001

AAAm

0.11%

N/A

Sub Total Local Government Investment Pool

1,445,027.83

410.40

17,465,038.88

2,030.51

1,013,210.44

250.89

1,013,210.44

250.89

Money Market CSIP MM

CSIP

AAAm

N/A

Sub Total Money Market US Agency FFCB

3133ED7L0

AAA

0.33%

11/13/2015

5,000,000.00

0.00

FFCB

3133ED6Z0

AAA

0.55%

05/12/2016

3,000,000.00

0.00

FFCB

3133EC3M4

AAA

0.60%

11/21/2016

3,000,000.00

0.00

FFCB

3133EC940

AAA

0.64%

05/09/2017

5,000,000.00

0.00

FFCB

3133EAU22

AAA

0.68%

09/12/2016

5,000,000.00

17,000.00

FFCB

3133ECY57

AAA

1.58%

08/28/2017

3,000,000.00

23,700.00

FHLB

313381ZP3

AAA

0.43%

02/12/2016

5,000,000.00

10,750.00

FHLB

313381QX6

AAA

0.55%

07/25/2016

3,000,000.00

8,250.00

FHLB

313382TR4

AAA

0.60%

04/24/2017

5,000,000.00

0.00

FHLB

313382HD8

AAA

0.70%

12/27/2016

5,000,000.00

17,500.00

FHLB

313382HT3

AAA

0.75%

03/27/2017

5,000,000.00

18,750.00

FHLB

313382W25

AAA

0.75%

08/15/2027

5,000,000.00

0.00

FHLB

313380U88

AAA

0.80%

04/17/2017

3,000,000.00

0.00

FHLB

3133727K4

AAA

2.13%

12/28/2015

2,000,000.00

0.00

FHLB

313382F65

AAA

0.60%

03/27/2018

5,600,000.00

16,800.00

FHLB

313382FL2

AAA

0.63%

03/27/2018

5,000,000.00

15,625.00

FHLB

313382T78

AAA

0.55%

04/30/2018

3,000,000.00

0.00

Chart continues next page

Description Savings/Checking

Credit Rating

Coupon

Maturity

Ending Face

Interest

12/31/2013

Rate

Date

Amount/Shares

Dividends

313382Z63

AAA

0.50%

05/22/2018

5,000,000.00

0.00

FHLMC

3134G4LD8

AAA

0.40%

11/27/2015

5,000,000.00

0.00

FHLMC

3134G4VU9

AAA

1.15%

09/11/2017

3,000,000.00

0.00

FHLMC

3134G4KY3

AAA

1.00%

11/26/2018

3,000,000.00

0.00

FNMA

3136G0RX1

AAA

1.00%

07/26/2017

5,000,000.00

25,000.00

FNMA

3136G0XD8

AAA

1.00%

08/28/2017

6,000,000.00

30,000.00

FNMA

3136G1LA5

AAA

50.00%

05/15/2018

3,000,000.00

0.00

100,600,000.00

183,375.00

2,000,000.00

0.00

FHLB

CUSIP/Ticker

Subtotal Agency US Treasury T-bond

912828KY5

AAA

Subtotal US Treasury Totals

2.65%

06/30/2014

2,000,000.00

0.00

165,498,855.13

216,893.09

Investment Management Focus - 2014 2014 continues to be a struggle for the capital markets as the Fed has kept interest rates low, which will continue into 2014. 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 needs to capture attractive interest rates. 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 10bps.

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