and Actual

NOTES TO FINANCIAL STATEMENTS DECEMBER 31, 2020

G. Net Investment in Capital Assets

Net investment in capital assets is a component of net position, and consists of capital assets, net of accumulated depreciation, reduced by the outstanding balances of borrowing attributable to the acquisition, construction or improvement of those assets . The calculation of net investment in capital assets is shown below:

Capital assets, net Related debt Unspent debt proceeds Deferred loss on refunding Outstanding related accounts and contracts payable

Net investment in capital assets Governmental Business-type

Activities Activities $ 387,950 (91,428) 69,163 194 $ 322,717 -

(3,201) (3,377)

$ 362,678 $ 319,340

H. Change in Accounting Entity

The Arvada Economic Development Association (AEDA) was previously reported as a discrete component unit of the City and is currently reported as a blended component unit as funding is provided by the City . The City also has operational responsibility for AEDA . The change in accounting entity has resulted in a restatement of beginning net position for governmental funds in the fund statements and government wide statement of $713,000 .

I. GASB 84 and GASB 97

The City has adopted and implemented GASB Statement No . 84 Fiduciary Activities and GASB Statement No . 97 Certain Component Unit Criteria, and Accounting and Financial Reporting for Internal Revenue Code Section 457 Deferred Compensation Plans . GASB 84 provides guidance regarding the identification of fiduciary activities for accounting and financial reporting of fiduciary activities . Implementation resulted in moving certain escrow funds previously reported as agency funds with only assets and liabilities to the general fund with no impact to either beginning net positions and a restatement of beginning net position as of January 1, 2020 to include net position for the City’s two custodial funds, Ralston House and Jefferson Parkway Public Highway Authority which were previously reported in the general fund as an asset and liability . The City has implemented this statement in Fiscal year 2020 and has restated beginning net position as shown below:

Net position January 1, 2020 prior to adoption of GASB 84

Restatement for adoption of GASB 84 Fidiciary Activites Custodial Funds

1,129

Net position January 1, 2020 as adjusted $ 1,129

GASB 97 modified the applicability of certain component unit criteria related to defined contribution plans, including 457 plans, and was considered in conjunction with the implementation of GASB 84 and based upon this guidance none of the City’s defined contribution or 457 plans met the criteria to be reported as component units or fiduciary activities .

NOTES TO FINANCIAL STATEMENTS DECEMBER 31, 2020

J. GASB 88

The City has adopted and implemented GASB Statement No . 88 Certain Disclosures related to Debt, including Direct Borrowings and Direct Placements which provides guidance to improve information disclosed in the notes to governmental financial statements related to debt including direct borrowings and direct placements . The City’s Series 2015A Certificates of Participation are considered a direct placement transaction and has been identified as such in note E . Implementation of this standard did not result in a restatement of net position .

K. Subsequent Events

The worldwide pandemic, COVID19 started affecting all financial models in March, 2020 with non-essential businesses closed or operating under restrictions for much of 2020 . The first quarter of 2021 has brought increased hope in the battle against COVID-19 with millions of individuals receiving their vaccines . Restrictions have been reduced with some areas being fully open and others with lessoned restrictions and it is unknown what post pandemic spending habits of consumers will be . The City is actively monitoring all revenues and will make adjustments to 2021 revenues as needed .

In June, 2020 The Arvada City Council voted to add waste hauling and recycling services to the City’s current service structure . A dedicated team of City employees have worked to implement these services and service to Arvada citizens will commence in July, 2021 . A new enterprise fund has been created to capture the activity of these services .

The Food Service enterprise fund will cease operations in June, 2021 . The 2015 agreement between the City and the Arvada Center Arts for the Humanities non-profit agreement indicated the entire building would be turned over to the Arvada Center by 2024 and Food Services would vacate the building . The Arvada City Council made the decision to close Food Service operations June 30, 2021 and vacate the building .