City of Arvada CAFR Year Ending 12/31/13

Arvada, Colorado

Comprehensive Annual Financial Report

For the Year Ended December 31, 2013

CITY OF

ARVADA, COLORADO

COMPREHENSIVE ANNUAL FINANCIAL REPORT For The Year Ended December 31, 2013

REPORT ISSUED BY:

DEPARTMENT OF FINANCE BRYAN ARCHER, DIRECTOR

CITY OF

ARVADA, COLORADO

COMPREHENSIVE ANNUAL FINANCIAL REPORT December 31, 2013

TABLE OF CONTENTS Section

Page

INTRODUCTORY SECTION Letter of Transmittal – Director of Finance ................................................................................. 1-4 Government Finance Officers Association Certificate of Achievement ....................................... 5 City Officials.................................................................................................................................. 6 Organizational Chart .................................................................................................................... 7

FINANCIAL SECTION Report of Independent Certified Public Accountants ......................................................... 9-11 Management’s Discussion and Analysis (unaudited) ........................................................ 13-24 Basic Financial Statements Government-wide Financial Statements Statement of Net Position............................................................................................... 25 Statement of Activities ................................................................................................. 26-27 Fund Financial Statements Governmental Funds Financial Statements Balance Sheet.......................................................................................................... 28 Reconciliation of the Balance Sheet of Governmental Funds to the Statement of Net Position ....................................................................... 29 Statement of Revenues, Expenditures, and Changes In Fund Balances ............... 30 Reconciliation of the Statement of Revenues, Expenditures and Changes in Fund Balances of Governmental Funds to the Statement of Activities ....................................................................................... 31 General Fund Statement of Revenues, Expenditures and Changes in Fund Balance – Budget and Actual ............................................................... 32 Community Development Fund Statement of Revenues, Expenditures and Changes in Fund Balance – Budget and Actual ........................................ 33 Arvada Center Fund – Statement of Revenues, Expenditures and Changes in Fund Balance – Budget and Actual ............................................................... 34 Parks Fund - Statement of Revenues, Expenditures and Changes in Fund Balance – Budget and Actual ............................................................... 35 Proprietary Funds Financial Statements Statement of Net Position ........................................................................................ 36 Statement of Revenues, Expenses and Changes in Fund Net Position ................. 37 Statement of Cash Flows ......................................................................................... 38 Fiduciary Funds Financial Statements Statements of Fiduciary Net Position ...................................................................... 39 Statements of Changes in Fiduciary Net Position ................................................... 40

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CITY OF

ARVADA, COLORADO

COMPREHENSIVE ANNUAL FINANCIAL REPORT December 31, 2013

TABLE OF CONTENTS Section

Page Notes to the Financial Statements .......................................................................... 41-72

Required Supplementary Information (unaudited) Schedule of Funding Progress .......................................................................................... 73 Supplementary Information Combining and Individual Fund Statements and Schedules AEDA – Balance Sheet ............................................................................................ 74 AEDA – Statement of Revenues, Expenditures and Changes in Fund Balance .... 75 AEDA – Statement of Cash Flows ........................................................................... 76 Non-Major Governmental Funds Combining Balance Sheet .................................................................................... 78-79 Combining Statement of Revenues, Expenditures and Changes in Fund Balances ............................................................................................ 80-81 Lands Dedicated Fund – Schedule of Revenues, Expenditures and Changes in Fund Balance – Budget and Actual ............................................... 82 Arvada Housing Authority – Schedule of Revenues, Expenditures and Changes in Fund Balance – Budget and Actual ............................................... 83 Police Seizure Fund – Schedule of Revenues, Expenditures and Changes in Fund Balance – Budget and Actual ............................................................... 84 Police Tax Increment Fund (.21) – Schedule of Revenues, Expenditures and Changes in Fund Balance – Budget and Actual ........................................ 85 Police Tax Increment Fund (.25) – Schedule of Revenues, Expenditures and Changes in Fund Balance – Budget and Actual ........................................ 86 Grants Fund - Schedule of Revenues, Expenditures and Changes in Fund Balance – Budget and Actual ............................................................... 87 Bond Fund - Schedule of Revenues, Expenditures and Changes in Fund Balance – Budget and Actual ............................................... 88 Debt Service Fund – Schedule of Revenues, Expenditures and Changes in Fund Balance – Budget and Actual ............................................................... 89 Enterprise Funds Water Fund – Budgetary Comparison Schedule ..................................................... 92 Wastewater Fund – Budgetary Comparison Schedule ........................................... 93 Stormwater Fund – Budgetary Comparison Schedule ............................................ 94 Food Service Fund – Budgetary Comparison Schedule ......................................... 95 Golf Fund – Budgetary Comparison Schedule ........................................................ 96 Internal Service Funds Combining Statement of Net Position ...................................................................... 98 Combining Statement of Revenues, Expenses and Changes in Fund Net Position ....................................................................................................... 99 Combining Statement of Cash Flows ..................................................................... 100 Insurance Service Fund – Budgetary Comparison Schedule ................................. 101 Computer Fund – Budgetary Comparison Schedule .............................................. 102 Print Shop Fund – Budgetary Comparison Schedule ............................................. 103 Vehicle Fund – Budgetary Comparison Schedule .................................................. 104 ii

CITY OF

ARVADA, COLORADO

COMPREHENSIVE ANNUAL FINANCIAL REPORT December 31, 2013

TABLE OF CONTENTS Section

Page Building Fund – Budgetary Comparison Schedule ................................................. 105 Fiduciary Fund Agency Fund – Statement of Changes in Assets and Liabilities ............................ 107 Local Highway Finance Report .............................................................................. 109-110

STATISTICAL SECTION (UNAUDITED) Financial Trends Net Position by Component ................................................................................................. 112 Changes in Net Position (expenses) ................................................................................... 113 Changes in Net Position (revenues) .................................................................................... 114 Fund Balances, Governmental Funds ................................................................................. 115 Changes in Fund Balances, Governmental Funds .............................................................. 116 Revenue Capacity Direct and Overlapping Property Tax Rates ........................................................................ 117 Sales and Use Tax Revenue ........................................................................................... 118-119 Principal Property Tax Payers ......................................................................................... 120-121 Property Tax Levies and Collections ................................................................................... 122 Assessed Value and Actual Value of Taxable Property ...................................................... 123 Debt Capacity Ratios of Outstanding Debt by Type .................................................................................... 124 Ratios of General Bonded Debt Outstanding ...................................................................... 125 Direct and Overlapping Governmental Activities Debt ........................................................ 126 Legal Debt Margin Information ............................................................................................ 127 Pledged-Revenue Coverage ............................................................................................... 128 Schedule of Debt Service Requirements – Governmental Activities................................... 129 Schedule of Debt Service Requirements – Business-type Activities................................... 130 Demographic and Economic Information Demographic and Economic Statistics ................................................................................ 131 Principal Employers ......................................................................................................... 132-133 Operating Information Full-time Equivalent City Government Employees by Function/Program ............................ 134 Operating Indicators by Function/Program .......................................................................... 135 Capital Asset Statistics by Function/Program ...................................................................... 136

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CITY OF

ARVADA, COLORADO

COMPREHENSIVE ANNUAL FINANCIAL REPORT December 31, 2013

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Introductory Section

Introductory Section Letter of Transmittal Government Finance Officers Association Certificate of Achievement City Officials Organizational Chart

June 20, 2014 Citizens of the City of Arvada, Honorable Mayor, Members of City Council and City Manager We are pleased to submit the Comprehensive Annual Financial Report for Arvada, Colorado for the fiscal year ended December 31, 2013. Responsibility for both the accuracy of the data and the completeness and fairness of the presentation, including all disclosures, rests with the management of the City. To the best of our knowledge and belief, the enclosed data is accurate in all material respects and is reported in a manner designed to present the financial position and results of operations of various funds and component units of the City in accordance with Generally Accepted Accounting Principles (GAAP). All disclosures necessary to enable the reader to gain an understanding of the City’s financial activities have been included.

In addition to an annual audit of the City’s financial records performed by a third-party private auditor, the City is also required to have an annual single audit in conformity with the provisions of the Single Audit Act, as amended, and U.S. Office of Management and Budget Circular A-133, Audits of States, Local Governments and Non-Profit Organizations. Information related to this single audit, including the schedules of federal and state financial assistance, findings and recommendations, and independent auditors’ reports on the internal control structure and compliance with applicable laws and regulations, are not included herein but are reported separately.

In conformity with generally accepted accounting principles, as set forth in Government Accounting Standards Board (GASB) Statement 39, Determining Whether Certain Organizations are Component Units and Statement 61, The Financial Reporting Entity, this report includes all funds of the primary government and the City’s component units. For this report the City of Arvada and all its departments and funds comprise the Reporting Entity. Our component units are the Arvada Urban Renewal Authority and the Arvada Economic Development Association.

The City is required to provide a narrative introduction, overview and analysis to accompany the basic financial statements in the form of management’s discussion and analysis (MD&A). This letter of transmittal is intended to complement the MD&A and should be read in conjunction with it.

PROFILE OF THE CITY OF ARVADA The City of Arvada is located approximately 20 miles to the northwest of the City of Denver, Colorado along Interstate 70. The City provides a full range of services, including police protection, physical parks, planning and zoning, transportation planning, street improvements and maintenance, a housing authority, a regional cultural center, two golf courses, municipal court services, water, wastewater and stormwater services and facilities, along with various administrative functions. The area has separate governmental units that provide fire protection and recreational services. The population of the City is approximately 109,157.

THE ECONOMIC FACTORS OF 2013 While the Great Recession ended in 2009, the recovery from this recession has been slow for many state and local governments. The City fared better than many other governments during this period. However, this event exemplifies the need for continued long-term financial plans. The City uses a long-term financial plan that includes ten-year operating and capital improvement plans for all funds and also maintains adequate reserves in all major funds. The allocation of resources is then made in the context of “Taking Lasting Care”, “Building the Base” and “Investing in the Future” priorities. Along with the long-term planning, the City started a two-year process in 2013 to move from a line item divisional-based budget to a program-based departmental budget with 2-6 year strategic results. This process will be completed in 2014 with a go-live date of January 2015.

City of Arvada Letter of Transmittal Comprehensive Annual Financial Report Page 2 The City’s recovery from the Great Recession continued in 2013 with positive increases in sales and use tax collections, auto use tax and building use tax which all surpassed pre-recession levels. Sales tax receipts – which pay for over 50 percent of our general expenditures – increased by 5.9 percent over 2012 levels.

Automobile sales were higher nationally and locally, generating over $6.2 million for the City, which is a 12 percent increase above 2012 and the third consecutive year of double digit growth. Building activity was once again much higher with the issuance of 427 single-family detached permits. This was a 133 percent increase over 2012 and the highest number since 1999. To put this in perspective, we issued a total of 64 single-family permits in all of 2009.

While increased revenues show a positive picture, the City remained conservative and added few resources to ongoing expenditures other than normal inflationary increases. Ongoing capital maintenance continues to be a large part of the City’s expenditures. With our focus on “Taking Lasting Care” we again dedicated in 2013 over $5 million to be spent on street repairs. The Water and Wastewater Funds spent over $5.2 million replacing pipe, and the Parks Fund continues to upgrade and replace outdated playgrounds.

Capital investments in our community continued in 2013 under the “Building the Base” priority. The City spent over $10.3 million in 2013 for various projects including the Ralston Central Park, Kipling Trail, Forest Springs Park, Spring Mesa Park, various tennis court renovations and the Sheridan Avenue Bridge replacement.

Finally, Council set aside another $3.15 million to “Invest in the Future”. A large percentage of the additional money set aside by Council was generated by the increase in sales tax, use tax and building-related revenues.

The $3.15 million will be added to the funds already reserved for transit improvements related to the Gold Line and the rail stop located in Olde Town Arvada.

The three priorities all help to advance the City’s mission of “Continuing to Build a Great Community”. The Council and the employees of the City of Arvada, along with its citizens, show that they are dedicated to this with all of the programs and projects accomplished in 2013.

FUTURE ECONOMIC FACTORS The City of Arvada’s current sales tax base is primarily based upon grocery store-anchored shopping areas. In addition we have five major retailers: Kohl’s, Costco, Sam’s Club, K-Mart and Target, and two large home improvement stores: Home Depot and Lowes. All of these businesses continued to do well in 2013.

As mentioned before, single-family home permits grew drastically in 2013. Many of these homes range from $300,000 to upwards of $650,000 and have been selling at a brisk pace. This not only helps our building-related revenues but is bringing additional sales and use tax to the City. As development continues, we will see additional pressures on resources such as police, and have already seen the additional demand on the planning and building departments driving the need to hire outside contract help with review and permitting.

The City continues to focus on three major development/redevelopment areas. These are the “Ralston Fields” urban renewal area, the three rail station stops and the completion of the 470 beltway. Each one of these areas has its own challenges but each will have a major financial impact on the City in the years to come.

The “Ralston Fields” area was established in 2003 by City Council as an economic development area. The first phase of redevelopment included the addition of a Target, Big 5 and many smaller retail restaurants and shops.

With the addition of a 360-unit, multi-family project, the area has seen increased usage. The next phase of development will occur in the “triangle” area, recently named “Ralston Creek”. There are initial plans for a large anchor store with smaller retail positioned on the perimeter. The planning for this development will continue through 2014 with the goal of breaking ground in late 2014 or early 2015.

City of Arvada Letter of Transmittal Comprehensive Annual Financial Report Page 3 The three rail stations are in various planning stages with the Wadsworth Olde Town Station being the furthest along. The City, the Arvada Urban Renewal Authority and RTD recently agreed upon a final design for the garage, bus transfer facility and plaza space. This will be part of Phase 1 of the transit-oriented development.

Phase 2 will include retail, office space and higher density residential, and should begin in the fall of 2016. The Kipling Station is located in the Ralston Fields redevelopment area and right next door to the large ongoing multifamily project. Finally, the Sheridan Station, with the completion of the new overpass bridge on Sheridan, will begin its planning process. Each one of these areas will benefit the City in the short term with retail sales tax and in the long term with added commercial and residential development.

The completion of the 470 beltway will also have long-term implications. The final ten miles is between Broomfield County, Jefferson County and the City of Arvada. These three entities have created a joint Public Highway Authority to determine if a public private partnership (P3) can be created to complete this integral piece of the regional transportation system. In 2013, further discussions occurred with various entities about connectivity and various challenges. This is the last piece of a large transportation project that would connect I25 to I-70 west to the mountains.

Overall, we continue to see signs of an improving economy. We believe the investment in basic infrastructure and keeping our focus on the three prime areas of economic growth will enable the City to continue the concept of growing at a sustainable rate.

FINANCIAL INFORMATION Pension Trust Funds: The City has three defined contribution programs for different types of employees: These are the City of Arvada Retirement Program (CARP) for its regular employees; the Arvada Police Pension Plan (APPP) for its uniformed police officers; and the Executive Management Program for the appointed management team. The City deposits between 10% – 15% into an individual’s account and the employee must contribute between 8% – 10%. The employee directs their own investments within a limitation of funds as identified by each Board. In addition, the City offers voluntary 457 programs where employees can place additional dollars for retirement on a tax-free basis. All three programs have independently elected Boards. The APPP uses Fidelity Investments as their record keeper. The others all use Great West Retirement Services. The Council adopts the investment plans of all the Boards. The City also has one defined benefit plan that covers one fully vested participant that did not elect to participate in the Arvada Police Pension Plan that became effective in 1986.

Internal Control Structure: The City of Arvada establishes and maintains an internal control structure designed to ensure that the assets of the City are protected from loss, theft, or misuse, and to ensure that adequate accounting data is compiled to allow for the preparation of financial statements in conformity with generally accepted accounting principles. The internal control structure is designed to provide reasonable, but not absolute, assurance that these objectives are met. The concept of reasonable assurance recognizes that the cost of a control should not exceed the benefits likely to be derived, and valuation of costs and benefits requires estimates and judgments by management.

Budgetary Controls: The City of Arvada maintains budgetary controls in order to ensure compliance with legal provisions embodied in the annual appropriated budget approved by the City of Arvada’s City Council, its governing body. All activities of the City are included in the annual appropriated budget. The City maintains an accounting system to provide management with information regarding obligations against appropriations.

Budgetary compliance is based on expenditures during the period (GAAP), rather than expenditures and encumbrances (non-GAAP). Because appropriations lapse at December 31, encumbrances outstanding are carried over and become a liability on the 2014 budget. Appropriations for fiscal year 2014 will provide the authority to complete those transactions.

City of Arvada Letter of Transmittal Comprehensive Annual Financial Report Page 4 Single Audit: As a recipient of federal and state financial assistance, the City is responsible for ensuring that adequate internal control structure is in place to ensure compliance with applicable laws and regulations related to those programs. As part of the City's single audit, tests are performed to determine the adequacy of the internal control structure, including that portion related to federal financial assistance programs, as well as to determine that the City has complied, in all material respects, with applicable laws and regulations. The results of the City’s single audit for fiscal year 2013, including any reported instances of significant deficiencies in the internal control structure or any violations of applicable laws and regulations, are reported separately.

Independent Audit: Section 10.9 of the City of Arvada’s charter requires an annual audit of accounts and other evidences of financial transactions of the City and its departments by independent certified public accountants.

The audit is performed by a firm chosen by a three-member audit board consisting of the City Manager and two members of the City Council, known as the Finance Committee. This year BKD, LLP, a firm of independent accountants, audited the financial statements for the year ended December 31, 2013.

AWARDS AND ACKNOWLEDGEMENTS The Government Finance Officers Association of the United States and Canada (GFOA) awarded a Certificate of Achievement for Excellence in Financial Reporting to the City of Arvada for its Comprehensive Annual Financial Report (CAFR) for the fiscal year ended December 31, 2012. The City of Arvada has received this award for 29 consecutive years. In order to be awarded a Certificate of Achievement, a government must publish an easily readable and efficiently organized CAFR. This report must satisfy generally accepted accounting principles and applicable legal requirements.

A certificate of achievement is valid for a period of one year only. We believe that our current CAFR continues to meet the certificate of achievement program requirements and we are submitting it to the committee to determine its eligibility for another certificate.

The preparation of this report could not have been accomplished without the professionalism and dedication demonstrated by the financial and management personnel of each department. Special mention needs to be directed to the dedicated employees of the Finance Department charged with ensuring that all accounting principles are adhered to each and every day, thus ensuring the efficient and effective preparation of this audit and document. Special thanks go to Lisa Yagi, Assistant Finance Director; Debra Nielson, Controller; and many people of their team. The production of the document was in the capable hands of Arlene Martinez, the Finance Department’s Executive Assistant, as well as Steve Milke and Bun Heng, the City’s Creative Services Design and Print Services staff.

Respectfully submitted,

Bryan Archer Director of Finance

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ARVADA, COLORADO

CITY OF

COMPREHENSIVE ANNUAL FINANCIAL REPORT December 31, 2013

City Officials Marc Williams Mayor (Term expires 2015) Don Allard Councilmember – At-Large (Term expires 2017) Bob Fifer Councilmember – At-Large (Term expires 2015) Gerald Marks Councilmember – District 1 (Term expires 2015) Mark McGoff Councilmember – District 2 (Term expires 2015) John Marriott Councilmember – District 3 (Term expires 2017) Bob Dyer Councilmember – District 4 (Term expires 2015)

City Manager and Key Staff Mark G. Deven William Ray David Cooke Christopher K. Daly Michael Elms Ron Czarnecki Hazel Hartbarger Robert Manwaring Linda Haley Maureen Phair Gordon Reusink Bryan Archer Philip Sneed James Sullivan Don Wick Chris Koch

City Manager Deputy City Manager Municipal Judge City Attorney Director of Community Development Director of Information Technology Director of Arvada Economic Development Association Director of Public Works Director of Human Resources Executive Director of Arvada Urban Renewal Authority Director of Parks, Golf and Hospitality Services Director of Finance Executive Director of Arvada Center Director of Utilities Chief of Police City Clerk

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CITY OF

ARVADA, COLORADO

COMPREHENSIVE ANNUAL FINANCIAL REPORT December 31, 2013

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CITY OF

ARVADA, COLORADO

COMPREHENSIVE ANNUAL FINANCIAL REPORT December 31, 2013

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Reports of Independent Certified Public Accountants Management’s Discussion and Analysis Basic Financial Statements Notes to the Financial Statements

Financial Section

Financial Section

Report of Independent Certified Public Accountants

Independent Auditor’s Report

Honorable Mayor and Members of City Council City of Arvada Arvada, Colorado Report on Financial Statements We have audited the accompanying basic financial statements of the governmental activities, the business-type activities, the discretely presented component units, each major fund and the aggregate remaining fund information of the City of Arvada (the City), as of and for the year ended December 31, 2013, and the related notes to the basic financial statements, which collectively comprise the City’s basic financial statements as listed in the table of contents.

Management’s Responsibility for the Financial Statements

Management is responsible for the preparation and fair presentation of these financial statements in accordance with accounting principles generally accepted in the United States of America; this includes the design, implementation and maintenance of internal control relevant to the preparation and fair presentation of financial statements that are free from material misstatement, whether due to fraud or error.

Auditor’s Responsibility

Our responsibility is to express opinions on these financial statements based on our audit. We conducted our audit in accordance with auditing standards generally accepted in the United States of America.

Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free from material misstatement.

An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the financial statements. The procedures selected depend on the auditor’s judgment, including the assessment of the risks of material misstatement of the financial statements, whether due to fraud or error.

In making those risk assessments, the auditor considers internal control relevant to the entity’s preparation and fair presentation of the financial statements in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the entity’s internal control. Accordingly, we express no such opinion. An audit also includes evaluating the appropriateness of accounting policies used and the reasonableness of significant accounting estimates made by management, as well as evaluating the overall presentation of the financial statements.

We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinions.

Honorable Mayor and Members of City Council City of Arvada

Opinions

In our opinion, the financial statements referred to above present fairly, in all material respects, the respective financial position of the governmental activities, the business-type activities, the discretely presented component units, each major fund, and the aggregate remaining fund information of the City of Arvada as of December 31, 2013, and the respective changes in financial position, budgetary comparisons, and cash flows, where applicable, thereof for the year then ended in accordance with accounting principles generally accepted in the United States of America.

Prior Year Audited by Other Auditors

The 2012 financial statements were audited by other auditors and their report thereon, dated June 20, 2013, expressed an unmodified opinion.

Emphasis of Matter

As discussed in Note I to the financial statements, in 2013, the City adopted new accounting guidance Governmental Accounting Standards Board (GASB) Statement No. 65, Items Previously Reported as Assets and Liabilities (GASB 65). Our opinions are not modified with respect to this matter.

Other Matters

Required Supplementary Information Accounting principles generally accepted in the United States of America require that the management’s discussion and analysis and pension information (schedule of funding progress) listed in the table of contents be presented to supplement the basic financial statements. Such information, although not part of the basic financial statements, is required by the Governmental Accounting Standards Board, who considers it to be an essential part of financial reporting for placing the basic financial statements in an appropriate operational, economic or historical context. We have applied certain limited procedures to the required supplementary information in accordance with auditing standards generally accepted in the United States of America, which consisted of inquiries of management about the methods of preparing the information and comparing the information for consistency with management’s responses to our inquiries, the basic financial statements and other knowledge we obtained during our audit of the basic financial statements. We do not express an opinion or provide any assurance on the information because the limited procedures do not provide us with sufficient evidence to express an opinion or provide any assurance.

Supplementary Information Our audit was conducted for the purpose of forming opinions on the financial statements that collectively comprise the City’s basic financial statements. The combining and individual fund financial statements and schedules and other supplementary information listed in the table of contents, is presented for purposes of additional analysis and is not a required part of the basic financial statements. Such information is the responsibility of management and was derived from and relates directly to the underlying accounting and other records used to prepare the basic financial statements. The information has been subjected to the auditing procedures applied in the audit of the basic financial statements and certain additional procedures, including comparing and reconciling such information directly to the underlying accounting and other records used to prepare the basic financial statements or to the basic

Honorable Mayor and Members of City Council City of Arvada

financial statements themselves, and other additional procedures in accordance with auditing standards generally accepted in the United States of America. In our opinion, the information is fairly stated in all material respects in relation to the basic financial statements as a whole.

Other Information Our audit was conducted for the purpose of forming opinions on the basic financial statements as a whole.

The introductory and statistical sections listed in the table of contents is presented for purposes of additional analysis and is not a required part of the basic financial statements. Such information has not been subjected to the auditing procedures applied in the audit of the basic financial statements, and accordingly, we do not express an opinion or provide any assurance on it.

Denver, Colorado June 19, 2014

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Management’s Discussion and Analysis

CITY OF

ARVADA, COLORADO

MANAGEMENT’S DISCUSSION AND ANALYSIS (UNAUDITED) December 31, 2013

This section of the City of Arvada’s Comprehensive Annual Financial Report provides readers with a narrative overview and analysis of the City’s financial performance during the fiscal year that ended on December 31, 2013. We encourage readers to consider the information presented here in conjunction with the letter of transmittal at the front of this report, the City’s basic financial statements and notes to the financial statements, to enhance their understanding of the activities and financial health of the City of Arvada.

Overview of Financial Statements This discussion and analysis is intended to serve as an introduction to the City’s basic financial statements. The City’s basic financial statements consist of the following three components: • • •

Government-wide Financial Statements Fund Financial Statements Notes to the Financial Statements

Other supplementary information is also included at the end of the report.

Government-wide Financial Statements. The government-wide statements are designed to provide readers with a broad overview of the City’s finances using the accrual basis of accounting, the basis of accounting used by most private-sector businesses.

The statement of net position presents information on all of the City’s assets and deferred outflows of resources and liabilities and deferred inflows of resources, with the difference reported as net position.

Over time, increases and decreases in net position may provide an indication of whether the City’s financial position is improving or deteriorating.

The statement of activities presents information reflecting how the City’s net position has changed during the fiscal year that just ended. All changes in net position are reported as soon as the underlying activity occurs. Thus, revenues and expenses are reported in these statements for some items that will only result in cash flows in future periods (e.g. uncollected taxes and earned but unused vacation leave).

The government-wide financial statements distinguish functions of the City that are principally supported by taxes and intergovernmental revenues (government activities) from other functions that are intended to recover all or a significant portion of their costs through user fees and charges (business-type activities).

The governmental activities of the City include general government, public safety, public works, parks, cultural and human service. The business-type activities of the City include water, wastewater, stormwater, golf and food service.

The government-wide financial statements also include both the Arvada Urban Renewal Authority and Arvada Economic Development Association as discretely presented component units of the City.

Fund Financial Statements. Traditional users of the City’s financial statements will find the fund financial statement presentation more familiar.

A fund is a grouping of related accounts that is used to maintain control over resources that have been segregated for specific activities or objectives. A major fund should generally meet both of the following criteria: 1) total assets, liabilities, revenues, or expenditures/expenses are at least 10% of the corresponding total (assets, liabilities or expenditures/expenses) for that fund type (i.e. governmental or enterprise funds) and 2) total assets, liabilities, revenues, or expenditures/expenses of the individual governmental or enterprise fund are at least 5% of the corresponding total for all governmental and enterprise funds combined.

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CITY OF

ARVADA, COLORADO

MANAGEMENT’S DISCUSSION AND ANALYSIS (UNAUDITED) December 31, 2013

The City, like other state and local governments, uses fund accounting to ensure and demonstrate compliance with finance-related legal requirements. All funds of the City can be divided into three categories: governmental funds, proprietary funds and fiduciary funds.

Governmental Funds. Governmental funds are used to report those same functions reported as governmental activities in the government-wide financial statements. However, unlike the governmentwide statements, the fund financial statements are prepared on the modified accrual basis. Under the modified accrual basis of accounting, revenues are recognized when they become measurable and available, and expenditures are recognized when the related fund liability is incurred, with the exception of long-term debt and similar long-term items which are recorded when due. Therefore, the focus of the governmental fund financial statements is on near-term inflows and outflows of spendable resources as well as on the balance of spendable resources available at the end of the fiscal year.

Since the focus of the governmental funds is on near-term resources, it is useful to compare the information presented for governmental funds with similar information presented for governmental activities in the government-wide financial statements. To facilitate this comparison, reconciliations are provided for both the governmental fund balance sheet and the governmental statements of revenues, expenditures and changes in fund balances.

Information is presented separately in the governmental fund balance sheet and in the governmental fund statement of revenues, expenditures, and changes in fund balance for the General fund, Community Development fund, Arvada Center fund, Parks fund, and the General Capital Projects fund. These five funds are considered to be major funds. Data from the other governmental funds is combined into a single aggregated presentation. Individual fund data for each of these non-major funds is provided in the form of combining statements located within the supplementary information following the notes to the financial statements.

The City adopts an annual appropriated budget for all of its governmental funds. A budgetary comparison statement has been provided to demonstrate compliance with this budget.

The basic governmental fund financial statements can be found on pages 28-31 of this report.

Proprietary Funds. The City maintains two different types of proprietary funds, enterprise and internal service funds. The proprietary fund financial statements are prepared on the accrual basis of accounting.

Enterprise funds are used to report the same functions presented as business-type activities in the government-wide financial statements. The City uses enterprise funds to account for its water, wastewater, stormwater, food service and golf operations. Internal service funds are accounting devices used to accumulate and allocate costs internally among the City’s various functions. The City uses internal service funds to account for dental benefits provided by the City, its risk management program, its replacement of vehicles and information technology equipment, maintenance of vehicles and buildings and its print shop operations. The activity in these funds is allocated between the governmental and business-type activities based upon actual usage.

Proprietary funds provide the same type of information as the government-wide financial statements, only in more detail. The Water, Wastewater, and Stormwater enterprise funds are considered to be major funds and are therefore presented separately within the proprietary fund financial statements. The Food Services and Golf Course funds are not required to be reported as major enterprise funds but are being presented as such. All internal service funds are considered to be non-major funds and they are combined into a single, aggregated column in the proprietary fund statements. Individual fund data for each of the non-major proprietary funds is provided in the form of combining statements located within the supplementary information following the notes to the financial statements.

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CITY OF

ARVADA, COLORADO

MANAGEMENT’S DISCUSSION AND ANALYSIS (UNAUDITED) December 31, 2013

The basic proprietary fund financial statements can be found on pages 36-38 of this report.

Fiduciary Funds. The City maintains two different types of fiduciary funds, trust and agency funds. The fiduciary fund financial statements are prepared on the accrual basis of accounting. The fiduciary funds are used to account for resources held by the City in a trustee capacity or as an agent for the benefit of parties outside the government. Fiduciary funds are not reflected in the government-wide financial statements because the resources of these funds are not available to support the City’s own programs.

The funds underlying each of the fiduciary fund types are combined into a single, aggregated column in the fiduciary fund statements The City does not adopt an annual appropriated budget for its fiduciary funds.

The basic fiduciary fund financial statements can be found on pages 39-40 of this report.

Notes to the Financial Statements. The notes to the basic financial statements are considered an integral part of the financial statements since they provide additional information needed to gain a full understanding of the data provided in both the government-wide and fund financial statements. The notes to the financial statements can be found on pages 41-72 of this report.

Combining Statements. The combining statements referred to earlier in connection with the non-major governmental funds, non-major enterprise funds, internal service funds and fiduciary funds are presented following the required notes to the financial statements.

Government-wide Financial Analysis As noted earlier, net position may serve over time as a useful indicator of a government financial position.

At the close of December 31, 2013, the City’s assets and deferred outflows of resources exceeded liabilities and deferred inflows of resources by $703,298,000. The following summaries of net position and changes in net position are presented for the current year and the previous year in comparison format.

15

CITY OF

ARVADA, COLORADO

MANAGEMENT’S DISCUSSION AND ANALYSIS (UNAUDITED) December 31, 2013

Statement of Net Position The following table reflects the condensed Statement of Net Position: City of Arvada Statement of Net Position December 31, 2013 (in thousands) Governmental Activities 2013

2012

2013

2012 97,778 236,110 147 334,035

$ 221,365 547,017 6,765 775,147

$ 228,997 523,828 3,580 756,405

17,020 35,247 52,267

5,757 13,054 18,811

6,661 15,051 21,712

23,051 44,140 67,191

23,681 50,298 73,979

4,658

4,829

-

-

4,658

4,829

Net position: Net investment in capital assets Restricted Unrestricted

262,131 19,018 92,089

252,120 22,517 90,637

238,881 1,536 89,643

219,419 1,706 91,198

501,012 20,554 181,732

471,539 24,223 181,835

Total net position prior to restatement

373,238

365,274 (533)

330,060

312,323 (147)

703,298

677,597

373,238

$ 364,741

$ 330,060

$ 312,176

$ 703,298

(680) $ 676,917

$

$

2012

17,294 31,086 48,380

Prior period adjustment* Total Net position after restatement

95,274 253,597 348,871

2013

$ 131,219 287,718 3,433 422,370

Other liabilities Long-term liabilities Total liabilities Deferred Inflows of resources Unavailable property taxes

$

Total Primary Government

126,091 293,420 6,765 426,276

Current and other assets Capital assets Other non-current assets Total assets

$

Business-type Activities

* Prior period adjustment due to GASB 65 elimination of bond issuance costs for Sales and Use Tax Bonds and Water Bonds.

For more detailed information, see the Statement of Net Position on page 25 of this report.

By far the largest portion of the City’s Governmental net position, $262,131,000 (70%), reflects its investment in capital assets (e.g. land, buildings, improvements, infrastructure and equipment), less any debt used to acquire those assets still outstanding. The City of Arvada uses these capital assets to provide services to citizens; consequently, these assets are not available for future spending. Although the City’s investment in capital assets is reported net of related debt, it should be noted that the resources needed to repay this debt must be provided from other sources since the capital assets themselves cannot be used to liquidate these liabilities.

An additional portion of the City’s Governmental net position, $19,018,000 (5%), represents resources that are subject to external restrictions on how they may be used. The remaining balance of unrestricted net position, $92,089,000 (25%), may be used to meet the City’s ongoing obligations to its citizens and creditors.

The City’s total net position increased by $26,381,000 during the current fiscal year. This is due to an increase in the governmental activities of $8,497,000 and an increase in the business-type activities of $17,884,000. The increase is primarily due to contributed capital from developers and increases in user fees that will be used for current and future capital projects.

16

CITY OF

ARVADA, COLORADO

MANAGEMENT’S DISCUSSION AND ANALYSIS (UNAUDITED) December 31, 2013

Changes in Net Position The following table reflects a condensed summary of activities and changes in net position: City of Arvada Statement of Activities December 31, 2013 (in thousands) Governmental Activities 2013 Revenues Program revenues: Charges for services Operating grants and contributions Capital grants and contributions General revenues: Sales and use taxes Property & ownership taxes Other taxes and fees Investment earnings (loss) Other Total revenues Expenses General government Public safety Public works Parks and recreation Culture Human service Interest Water Wastewater Stormwater Golf Food Total expenses Change in net position before transfers Transfers Increase in net position Net position, beginning Prior period adjustment * Net position, ending

$

$

Business-type Activities

2012

14,329 11,681 6,706

15,480 9,171 12,431

58,519 4,907 4,646 107 5,974 106,869

54,298 4,829 4,787 571 1,947 103,514

22,193 26,578 28,117 7,428 10,797 4,558 1,119 100,790

$

16,245 25,987 26,644 7,329 10,809 4,580 1,443 93,037

2013

$

42,341 17,633

2012

$

(56) 104 60,022 $

20,609 11,536 1,811 4,246 1,518 39,720

Total Primary Government

41,274 12,240

2013

$

582 86 54,182 $

19,634 10,553 1,572 4,094 1,636 37,489

56,670 11,681 24,339

2012

$

58,519 4,907 4,646 51 6,078 166,891 $

22,193 26,578 28,117 7,428 10,797 4,558 1,119 20,609 11,536 1,811 4,246 1,518 140,510

56,754 9,171 24,671 54,298 4,829 4,787 1,153 2,033 157,696

$

16,245 25,987 26,644 7,329 10,809 4,580 1,443 19,634 10,553 1,572 4,094 1,636 130,526

6,079 2,418 8,497 364,741 -

10,477 (1,279) 9,198 356,076 (533)

20,302 (2,418) 17,884 312,176 -

16,693 1,279 17,972 294,351 (147)

26,381 26,381 676,917 -

27,170 27,170 650,427 (680)

373,238

$ 364,741

$ 330,060

$ 312,176

$ 703,298

$ 676,917

*Prior Period Adjustment due to GASB 65 elimination of bond issue costs on Sales and Use Tax Bonds and Water Bonds.

For more detailed information, see the Statement of Activities on pages 26-27 of this report.

The above condensed summary of the City of Arvada’s governmental and business-type activities for the year ended December 31, 2013 reflects net position increasing $26,381,000. Revenues and expenses graphs are presented below to enhance the reader’s understanding of the current year activities.

17

CITY OF

ARVADA, COLORADO

MANAGEMENT’S DISCUSSION AND ANALYSIS (UNAUDITED) December 31, 2013

Governmental Activities Governmental Activities increased Arvada’s Net Position by $8,497,000.

2013 Revenues by Source Governmental Activities Other taxes and fees 4%

Other 6%

Charges for Services 13%

Property and ownership taxes 5%

Operating grants and contributions 11% Capital grants and contributions 6%

Sales and use taxes 55%

2013 Expenses and Program Revenues Governmental Activities $30,000 $25,000 $20,000

'Expense' 'Revenue'

$15,000 $10,000 $5,000 $-

General Govt

Public Safety

Public Works

Parks & Rec

18

Culture

Human Interest Svc

CITY OF

ARVADA, COLORADO

MANAGEMENT’S DISCUSSION AND ANALYSIS (UNAUDITED) December 31, 2013

Business-type Activities Business-type Activities increased Arvada’s Net Position by $17,884,000

2013 Revenues by Source Business Activities Capital grants and contributions 29%

Charges for Services 71%

2013 Expenses and Program Revenues Business-Type Activities $35,000 $30,000 $25,000

'Expense'

$20,000

'Revenue'

$15,000 $10,000 $5,000 $-

Water

Wastewater Stormwater

Golf

19

Food

CITY OF

ARVADA, COLORADO

MANAGEMENT’S DISCUSSION AND ANALYSIS (UNAUDITED) December 31, 2013

Governmental activities. Governmental activities increased the City’s net position by $8,497,000. Key elements of this change are due to the following: • • • •

Capital contributions from developers amounted to $5,593,000 Sales and use tax collections were up $4,221,000 Investment earnings were down $464,000 Charges for services were down $1,151,000

Business-type activities. Business-type activities increased the City’s net position by $17,884,000. Key elements of this increase are due to the following: • •

Capital contributions from developers amounted to $8,887,000.

The Water and Wastewater funds saw increases in tap fee revenues as a few new single-family home developments started construction during 2013. These tap fee revenues will be used for future capital needs.

Financial Analysis of the City’s Funds As noted previously, the City uses fund accounting to ensure and demonstrate compliance with financerelated legal requirements.

Governmental funds. The focus of the City’s governmental funds is to provide information on near-term inflows, outflows, and balances of spendable resources. Such information is useful in assessing the City’s financing requirements. In particular, unassigned fund balance may serve as a useful measure of a government’s net resources available for spending at the end of year.

In 2011, the City implemented The Governmental Accounting Standards Board (GASB) Statement No. 54, Fund Balance Reporting and Governmental Fund Type Definitions. This Statement defines the different types of fund balances that a governmental entity must use for financial reporting purposes. Per GASB 54, as of December 31, 2013, fund balances of governmental funds are classified as follows: Non-spendable – amounts that cannot be spent either because they are not spendable in form or because they are legally or contractually required to be maintained intact. The City had $871,000 in nonspendable resources.

Restricted – amounts that are subject to externally enforceable legal purpose restrictions imposed by creditors, grantors, contributors, or law and regulations of other governments; or through constitutional provisional or enabling legislations. The City had $18,148,000 in restricted resources.

Committed – amounts that are subject to a purpose constraint imposed by a formal action of the City Council. The City Council is the highest level of decision-making authority for the City. Commitments may be established, modified or rescinded only through resolutions and ordinances approved by the City Council. The City had $14,953,000 in committed resources.

Assigned – amounts that are for an intended use established by the City, but that are not considered restricted or committed. The purpose of the assignment must be narrower than the purpose of the General Fund. The City had $38,314,000 in assigned resources.

Unassigned – represents the remaining balance for the City’s General Fund. The City had $23,007,000 in unassigned resources.

20

CITY OF

ARVADA, COLORADO

MANAGEMENT’S DISCUSSION AND ANALYSIS (UNAUDITED) December 31, 2013

The General Fund is the main operating fund of the City. At December 31, 2013, the non-spendable fund balance was $640,000, the restricted fund balance was $2,028,000, and the unassigned fund balance was $23,007,000. The total fund balance increased $2,710,000 in 2013 to $25,675,000. On a budgetary basis, the General Fund finished over $5,618,000 to the good. Sales and Use tax came in $1,557,000 over budget. This represented an of 8.85% increase over 2012.

The Community Development Fund is a major fund of the City. At December 31, 2013, the restricted fund balance was $1,368,000 and the assigned fund balance was $5,528,000. Total fund balance decreased $24,000 in 2013 to $6,896,000. This was caused by the usage of fund balance to offset program expenses. In some years, the demand for the Essential Home Repairs Program exceeds the allotted Federal dollars. When this happens, resources are pulled from the fund balance to help offset the demand.

The Arvada Center Fund is a major fund of the City. At December 31, 2013, the non-spendable fund balance was $165,000, the restricted fund balance was $316,000 and the assigned fund balance was $165,000. The total fund balance increased $27,000 in 2013 to $646,000.

The Parks Fund is a major fund of the City. At December 31, 2013, the non-spendable fund balance was $47,000, the restricted fund balance was $136,000 and the assigned fund balance was $4,117,000. The total fund balance increased $239,000 in 2013 to $4,300,000. This is primarily due to an increase in Jefferson County Open Space funds received.

The General Capital Projects Fund is another major fund of the City. At December 31, 2013, the restricted fund balance was $1,849,000, the committed fund balance was $14,953,000 and the assigned fund balance was $28,504,000. The total fund balance increased $3,732,000 in 2013 to $45,306,000.

This increase is related to transfers from other funds for some large multi-year projects. Examples of these projects are the Ralston Central Park, 2-3 year time period, and the East and South Central Park projects, three-year time periods and the Gold Line/TOD development, four-year time period.

Proprietary funds. The City’s proprietary funds provide the same type of information found in the government-wide financial statements, but in more detail.

The unrestricted net position balances of the City’s proprietary funds (including the major enterprise funds) are reflected in the following table:

21

ARVADA, COLORADO

CITY OF

MANAGEMENT’S DISCUSSION AND ANALYSIS (UNAUDITED) December 31, 2013

Unrestricted Net Position for Year ended 12/31/13 Major Enterprise Funds Water Wastewater Stormwater Golf Food Total of major enterprise funds Internal service funds Total proprietary funds

66,779 11,893 5,941 101 554 85,268 19,208 104,476

$

Unrestricted Net Position for Year ended 12/31/12

$

64,119 12,011 9,338 633 675 86,776 21,454 108,230

Component units. The Arvada Economic Development Association (AEDA) was established to encourage all forms of economic development. Funding for AEDA consists of compensation from the City for services it renders the City and its citizens. The statement of net position reflects a $1,273,000 unrestricted net position balance. The total change in net position for AEDA was a decrease of $268,000.

The Arvada Urban Renewal Authority (AURA) was created by Ordinance No. 1717 under the Colorado Urban Renewal Law and approved by voters on March 3, 1981. AURA’s purpose is to develop, redevelop or rehabilitate blighted areas of the City. The governing body of AURA is a commission of seven members, appointed by the Mayor and approved by City Council. AURA’s annual budget is approved by the City Council and the City provides administrative support to AURA. The statement of net position reflects $953,000 of restricted net position balance and $8,425,000 of unrestricted net position balance. The total change in net position for AURA was an increase of $538,000.

Budgetary Highlights General Fund. The increase from the original budgeted expenditures to the final budget amounted to $4,572,000 increases, (not all inclusive) are summarized as follows:            

Added $909,667 for additional funding related to the Parkway Added $163,720 for funding of major street capital maintenance Added $2,500,000 for parking garage Added $350,000 for Arvada Center Added $137,000 for police radios Added $125,000 for consultants for permitting and inspections due to increased housing development Added $68,500 to sales tax rebate program Added $70,000 for KATV video services to Jefferson County Added $67,590 for training Added $46,188 for emergency traffic control during September rainfall event Added $33,000 sales tax reimbursement for West Town Center Agreement Added $101,335 for miscellaneous items including planning, unemployment, justice grant for taser devices, and equipment.

22

CITY OF

ARVADA, COLORADO

MANAGEMENT’S DISCUSSION AND ANALYSIS (UNAUDITED) December 31, 2013

Capital Asset and Debt Administration Capital Assets. The City’s investment in capital assets for its governmental and business-type activities as of December 31, 2013 amounted to $547,017,000 (net of accumulated depreciation). This investment in capital assets includes land, water rights, buildings and improvements, equipment and infrastructure.

City of Arvada Capital Assets (net of depreciation) as of December 31, 2013 (in thousands)

Land and water rights Infrastructure Construction in progress Buildings Improvements other than buildings Equipment & Vehicles Total capital assets

Governmental Activities

Business-type Activities

Total Primary Government

$

$

$

$

53,259 130,883 21,975 16,985 63,409 6,909 293,420

$

39,512 6,672 11,301 7,152 188,009 951 253,597

$

92,771 137,555 33,276 24,137 251,418 7,860 547,017

Major capital improvements during this fiscal year include the following: Governmental Activities • Completion of Kipling Trail • Completion of Forest Springs Park • Completion of Spring Mesa Park • Completion of Tennis Court renovations • Completion of the Sheridan Ave Bridge replacement Proprietary Activities • On-going improvements at the water treatment plan • On-going construction at Ralston Central Park • On-going maintenance and replacement of water, sewer and stormwater lines • Improvements in Leyden Rock subdivision Additional information of the City’s capital assets can be found in Note 3.B on pages 58-59 of this report.

23

ARVADA, COLORADO

CITY OF

MANAGEMENT’S DISCUSSION AND ANALYSIS (UNAUDITED) December 31, 2013

Long-term debt. At the end of December 31, 2013, the City had total debt outstanding of $46,418,000.

Of this amount, $31,249,000 represents bonds secured by specified revenue sources (i.e. sales tax revenue bonds and water revenue bonds). The remaining $15,169,000 represents capital leases of $697,000, Certificates of Participation of $12,210,000, and an OPEB liability of $2,262,000.

City of Arvada Outstanding Debt as of December 31, 2013 (in thousands) Governmental Activities

Business-type Activities

Total Primary Government

Revenue bonds Certificates of Participation OPEB Capital leases

$ $ $ $

17,635 12,210 2,262 324

$

$

$

13,614 373

31,249 12,210 2,262 697

Total outstanding debt

$

32,431

$

13,987

$

46,418

Additional information on the City’s long-term obligations can be found in Note 3.E on pages 61-64 of this report.

Financial Contact The City’s financial statements are designed to provide users (citizens, taxpayers, customers, investors and creditors) with a general overview of the City’s finances and to demonstrate the City’s accountability.

Questions concerning any of the information presented in this report or requests for additional information should be sent to the City’s Finance Director at the following address: City of Arvada Director of Finance P.O. Box 8101 Arvada, CO 80001

24

Basic Financial Statements Basic Financial Statements

CITY OF

ARVADA, COLORADO

STATEMENT OF NET POSITION December 31, 2013 (in thousands) Governmental Activities ASSETS Cash and investments Restricted cash Taxes receivable Accounts receivable, net of allowance for uncollectibles Accrued interest Internal balances Inventories Prepaid costs Notes receivable - non-current Property available for sale Investment in LLC Deposit Capital assets Land, water rights and construction in progress Other capital assets, net Total capital assets Total assets LIABILITIES Accounts payable Contracts payable Accrued interest payable Unearned revenue Long-term liabilities Due within one year: Bonds & notes payable Claims payable Certificates of Participation Capital leases Compensated absences Due more than one year: Bonds & notes payable Certificates of Participation Capital leases OPEB Compensated absences Total liabilities DEFERRED INFLOWS OF RESOURCES Unavailable property taxes NET POSITION Net Investment in assets Restricted for: Conversation Trust Law Enforcement/Seizure Emergencies Donor Intentions CDGB Housing Debt Service Lands Dedicated Adams County Open Space Adams County Transportation Park Development Scholarships and Grants Letter of Credit Nonspendable endowment Other Unrestricted Total Net Position

$

109,984 4,192 11,713

$

$

AURA

75,234 218,186 293,420 426,276

50,813 202,784 253,597 348,871

126,047 420,970 547,017 775,147

2 2 19,455

1,500

8,416 134 1,284

2,229 960 90 124

10,645 960 224 1,408

333 -

32 195

3,536 808 910 113 2,093

1,864 145 345

5,400 808 910 258 2,438

-

-

15,219 11,300 211 2,262 2,094 48,380

12,479 228 347 18,811

27,698 11,300 439 2,262 2,441 67,191

4,770 5,103

227

4,658

-

4,658

4,972

-

262,131

238,881

501,012

2

-

1,243 7,984 2,899 58 1,336 85 452 2,337 186 453 1,041 38 36 118 752 92,089 373,238

1,536 89,643 330,060

1,243 7,984 2,899 58 1,336 85 452 2,337 186 453 1,041 38 36 118 2,288 181,732 703,298

953 8,425 9,380

1,273 1,273

$

The accompanying notes are an integral part of these financial statements.

25

$

AEDA

4,720 89 4,375 416 83 -

$

48,953 36,638 -

Total 158,937 40,830 11,713 7,752 195 1,060 878 6,765 -

3,032 106 (4,375) 644 795 6,765 -

$

Component Units

Primary Government Business-type Activities

$

3,329 4,972 173 11 274 8,452 2,000 242

$

$

876 620 1 3 -

CITY OF

ARVADA, COLORADO

STATEMENT OF ACTIVITIES Year Ended December 31, 2013 (in thousands)

Program Revenues

Expenses FUNCTIONS/PROGRAM ACTIVITIES: Primary Government: Governmental activities: General government Public safety Public works Parks and recreation Culture Human services Investment earnings Total governmental activities Business-type activities: Water Wastewater Stormwater Golf Food Total business-type activities Total primary government Component Units: AURA AEDA Total component units

$

$ $ $

22,193 26,578 28,117 7,428 10,797 4,558 1,119 100,790

20,609 11,536 1,811 4,246 1,518 39,720 140,510 4,637 978 5,615

Charges for Services

$

5,726 2,870 902 4,831 14,329

22,635 11,179 3,254 3,921 1,352 42,341 56,670

$ $

250 250

$

Operating

Capital

Grants and Contributions

Grants and Contributions

$

$ $ $

The accompanying notes are an integral part of these financial statements.

26

913 1,873 3,537 1,068 4,290 11,681

11,681 706 706

$

$ $ $

Total

5,593 699 414 6,706

11,540 2,593 3,500 17,633 24,339 -

$

$ $ $

12,232 1,873 3,569 4,853 5,899 4,290 32,716

34,175 13,772 6,754 3,921 1,352 59,974 92,690 250 706 956

CITY OF

ARVADA, COLORADO

STATEMENT OF ACTIVITIES Year Ended December 31, 2013 (in thousands)

Net (Expense) Revenue and Changes in Net Position Primary Government - City of Arvada Governmental Activities

$

Business-type Activities

(9,961) (24,705) (24,548) (2,575) (4,898) (268) (1,119) (68,074)

$

(68,074) $

General Revenues Taxes: Property Sales and use Transportation tax Investment earnings (loss) Miscellaneous Transfers in (out) Total general revenues Change in net position Net position, January 1 Adjustment for change in accounting principle Net position, January 1 after restatement Net Position, December 31

-

$

$

-

$

312,176 330,060

-

$

676,917 703,298

The accompanying notes are an integral part of these financial statements.

27

$

Component

Unit AURA

Unit AEDA

-

$

$

4,907 58,519 4,646 51 6,078 74,201 26,381 677,597 (680)

(147)

$

(9,961) (24,705) (24,548) (2,575) (4,898) (268) (1,119) (68,074)

13,566 2,236 4,943 (325) (166) 20,254 (47,820)

(56) 104 (2,418) (2,370) 17,884 312,323

(533) 364,741 373,238

-

13,566 2,236 4,943 (325) (166) 20,254 20,254

4,907 58,519 4,646 107 5,974 2,418 76,571 8,497 365,274

$

Total

Component

-

-

(4,387) $ (4,387)

4,212 710 3 4,925 538 8,842

8,842 9,380

(272) (272)

4 4 (268) 1,541

-

$

-

-

$

1,541 1,273

CITY OF

ARVADA, COLORADO

GOVERNMENTAL FUNDS BALANCE SHEET December 31, 2013 (in thousands)

General Fund ASSETS Cash and investments Restricted cash Taxes receivable Accounts receivable, net of allowance for uncollectibles

$

Other Governmental Funds

Total Governmental Funds

$

$

$

$

245 31 23 289 351

Accrued interest Due from other funds Inventories Prepaid costs Non-current notes receivable, net of allowance for uncollectibles Total assets

23,132 11,034

Community Development Fund

Primary Government General Capital Projects Arvada Fund Center Parks

$

5,087 40,192

5,504 1,336 -

1,718 250 -

418 1 -

$

1,677 8,936

$

15 77 47 2,107

$

3,194 664

$

834 6 10 37

$

4,745

43,852 2,606 15 535 59

$

47,067

12,601 980 28 19

$

13,628

90,001 4,192 11,713 3,027 66 23 376 513

$

6,764 116,675

LIABILITES, DEFERRED INFLOWS OF RESOURCES AND FUND BALANCES LIABILITIES Accounts payable Due to other funds Unearned revenue Total liabilities

4,592 180 4,772

18 18

399 1,062 1,461

423 22 445

1,458 1,458

1,054 23 81 1,158

7,944 23 1,345 9,312

4,658 342 4,745

2,022

303

-

4,658 342 7,070

2,022

-

303

9,745

-

12,070

640 2,028 23,007

1,368 5,528 -

165 316 165 -

47 136 4,117 -

1,849 14,953 28,504 -

19 12,451 -

871 18,148 14,953 38,314 23,007

25,675

6,896

646

4,300

45,306

12,470

95,293

DEFERRED INFLOW OF RESOURCES Unavailable revenue -property taxes Unavailable revenue - grants Unavailable revenue - loan Total deferred inflows of resources FUND BALANCES Reserved for: Nonspendable Restricted Committed Assigned Unassigned

Total fund balances Total liabilities, deferred inflows of resources, and fund balances

$

40,192

$

8,936

$

2,107

The accompanying notes are an integral part of these financial statements.

28

$

4,745

$

47,067

$

13,628

$

116,675

CITY OF

ARVADA, COLORADO

RECONCILIATION OF THE BALANCE SHEET OF GOVERNMENTAL FUNDS TO THE STATEMENT OF NET POSITION December 31, 2013 (in thousands)

Amounts reported for governmental activities in the statement of net position (page 25) are different because: Total fund balances – governmental funds (page 28)

$ 95,293

Capital assets net of accumulated depreciation used in governmental activities are not current financial resources. Therefore, they are not reported in the fund financial statement.

287,009

Internal service funds are used by management to charge the costs of certain activities to individual funds. A portion of the assets and liabilities of internal service funds are included in the governmental activities in the statement of net position.

Long-term assets are not available to pay current year expenditures and therefore are deferred in the fund statements Notes Receivable – non-current net of allowance Grants Receivable – non-current AURA Note Subtotal

Long-term liabilities and related items are not due and payable in the current period and accordingly are not reported in the fund financial statements.

Balances at December 31, 2013 are: Bonds payable Obligation under certificates of participation Interest Accrual OPEB Compensated absences Subtotal Net position of governmental activities (page 25)

20,920

2,326 403 4,745 7,474

(18,755) (12,210) (134) (2,262) (4,097) (37,458) $ 373,238

The accompanying notes are an integral part of these financial statements.

29

CITY OF

ARVADA, COLORADO

GOVERNMENTAL FUNDS STATEMENT OF REVENUES, EXPENDITURES, AND CHANGES IN FUND BALANCES Year Ended December 31, 2013 (in thousands)

General Fund REVENUES Property and ownership taxes Sales and use taxes Franchise fees Licenses & permits Intergovernmental Charges for services Recovered costs Fines & forfeitures Investment earnings (loss) Memberships, donations & dedications Miscellaneous Total Revenues

$

EXPENDITURES Current expenditures: General government Public safety Public works Parks and recreation Culture Human services Debt service Principal Interest Capital outlay Total Expenditures EXCESS (DEFICIENCY) OF REVENUES OVER EXPENDITURES OTHER FINANCING SOURCES (USES) Bond proceeds Bond refinancing Transfers in Transfers out Total other financing sources (uses) NET CHANGE IN FUND BALANCES FUND BALANCES, BEGINNING FUND BALANCES ENDING

$

4,907 46,806 4,420 3,232 4,892 706 764 1,710 72 89 67,598

Community Development Fund $

688 6 387 1,081

Primary Government General Capital Projects Arvada Fund Center Parks $

1,039 4,831 39 277 134 6,320

$

43 3,537 859 (6) 106 4,539

$

1,193

Other Governmental Funds $

76 247 332 4,590

11,713 4,319 (20) 201 94 16,307

2,742

Total Governmental Funds $

4,907 58,519 4,420 3,275 15,668 5,537 4,365 1,710 167 725 1,142 100,435

11,638 19,514 20,498 -

769

10,458 -

7,049 -

2,000 -

2 6,868 3,784

13,640 26,382 20,498 7,049 10,458 4,553

65 51,715

769

10,458

7,049

10,325 12,325

3,895 1,209 6,078 21,836

3,895 1,209 16,468 104,152

15,883

312

(4,138)

(2,510)

(7,735)

(5,529)

(3,717)

(13,173) (13,173)

45 (381) (336)

4,165 4,165

2,884 (135) 2,749

11,467 11,467

7,527 (7,721) 1,549 (2,237) (882)

7,527 (7,721) 20,110 (15,926) 3,990

(24) 6,920 6,896

27 619 646

3,732 41,574 45,306

(6,411) 18,881 12,470

273 95,020 95,293

2,710 22,965 25,675

$

The accompanying notes are an integral part of these financial statements.

30

$

239 4,061 $ 4,300

$

$

$

CITY OF

ARVADA, COLORADO

RECONCILIATION OF THE STATEMENT OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCES OF GOVERNMENTAL FUNDS TO THE STATEMENT OF ACTIVITIES Year ended December 31, 2013 (in thousands) Net change in fund balances – total government funds (page 30) Governmental funds report capital outlays as expenditures. However in the statement of activities, the cost of those assets is allocated over their useful lives and reported as depreciation expense. This is the amount by which capital outlay exceeded depreciation in the current period.

Capital outlay Depreciation expense Disposal of capital assets Excess of capital outlay expense over depreciation Debt proceeds provide current financial resources to governmental funds, but issuing debt increases long-term liabilities in the statement of net position. Repayment of debt principal is an expenditure in the governmental funds, but repayment reduces long-term liabilities in the statement of net position. Issuing debt increases long-term liabilities and does not affect the statement of activities.

Repayment of principal Debt issuance proceeds

$ 273

16,479 (11,563) (4,850) 66

11,520 (6,800) 4,720

Revenues in the statement of activities that do not provide current financial resources are not reported as revenues in the governmental funds.

Bond premium due to refunding of debt Amortization of bond premium Developer contributed capital Donated assets Grants/notes receivable – current net of allowance Subtotal

(740) 221 5,593 29 648 5,751

Internal service funds are used by management to charge the costs of certain activities, such as risk management, vehicle replacement and maintenance, information technology replacement and the print shop services. A portion of the revenue (expense) of certain internal service funds is reported with governmental activities.

Some expenses reported in the statement of activities do not require the use of current financial resources and therefore are not reported as expenditures in governmental funds.

OPEB Interest expense Compensated absences Subtotal Change in net position of governmental activities (page 27)

The accompanying notes are an integral part of these financial statements.

31

(2,076)

(361) 13 111 (237) $ 8,497

CITY OF

ARVADA, COLORADO

GENERAL FUND STATEMENT OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCE – BUDGET AND ACTUAL Year Ended December 31, 2013 (in thousands)

Actual Amounts

Variance With Final Budget Positive (Negative)

$

$

Budgeted Amounts

REVENUES Property and ownership taxes Sales and use taxes Franchise fees Licenses and permits Intergovernmental Charges for services Recovered costs Fines and forfeitures Investment earnings Administrative services Miscellaneous Total revenues EXPENDITURES Current expenditures: Fund administration Legislative Judicial Management Legal Finance Human resources Public safety Public works Planning Information technology Total current expenditures Capital outlay Total expenditures EXCESS (DEFICIENCY) OF REVENUES OVER EXPENDITURES OTHER FINANCING SOURCES (USES) Transfer in Transfers out Total other financing (uses) NET CHANGE IN FUND BALANCE FUND BALANCE, BEGINNING FUND BALANCE, ENDING

Original

Final

$ 4,932 42,929 4,682 2,289 4,798 469 483 1,533 396 5,332 89 67,932

$ 4,932 45,249 4,215 2,609 4,789 519 583 1,754 300 5,471 89 70,510

1,568 287 945 2,616 1,528 2,965 1,225 20,017 20,862 3,016 3,203 58,232 58 58,290

3,194 287 956 2,626 1,528 3,034 1,225 20,050 21,162 3,049 3,203 60,314 118 60,432

2,557 240 954 2,615 1,498 2,773 1,134 19,514 20,498 2,484 2,835 57,102 65 57,167

637 47 2 11 30 261 91 536 664 565 368 3,212 53 3,265

9,642

10,078

15,883

5,805

(10,576) (10,576) (934) 19,098 $ 18,164

(12,986) (12,986) (2,908) 22,965 $ 20,057

Total expenditures as presented on budgetary basis plus allocation of internal transfers Total expenditures as presented on GAAP basis

4,907 46,806 4,420 3,232 4,892 706 764 1,710 72 5,452 89 73,050

(13,173) (13,173) 2,710 22,965 $ 25,675 57,167 (5,452) 51,715

The accompanying notes are an integral part of these financial statements.

32

$

(25) 1,557 205 623 103 187 181 (44) (228) (19) 2,540

(187) (187) 5,618 5,618

CITY OF

ARVADA, COLORADO

COMMUNITY DEVELOPMENT FUND STATEMENT OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCE – BUDGET AND ACTUAL Year Ended December 31, 2013 (in thousands)

Variance With Final Budgeted Amounts Original

Budget

Final

Actual

Positive

Amount

(Negative)

REVENUES Intergovernmental Investment earnings Miscellaneous

$

Total revenues

638 19 115

$

638 20 115

$

688 6 387

$

50 (14) 272

772

773

1,081

308

906

987

769

218

906

987

769

218

(134)

(214)

312

526

EXPENDITURES Current expenditures: Program costs Total expenditures EXCESS (DEFICIENCY) OF REVENUES OVER EXPENDITURES OTHER FINANCING SOURCES (USES) Transfers in

45

45

45

(134)

(573)

(381)

192

Total other financing sources

(89)

(528)

(336)

192

NET CHANGE IN FUND BALANCE

(223)

(742)

(24)

718

Transfers out

FUND BALANCE, BEGINNING FUND BALANCE, ENDING

$

6,955

6,920

6,920

6,732

$ 6,178

$ 6,896

The accompanying notes are an integral part of these financial statements.

33

-

$

718

CITY OF

ARVADA, COLORADO

ARVADA CENTER FUND STATEMENT OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCE – BUDGET AND ACTUAL Year Ended December 31, 2013 (in thousands)

Actual

Variance With Final Budget Positive

Amounts

(Negative)

$

$

Budgeted Amounts Original REVENUES Intergovernmental revenues Scientific and Cultural Facilities District State and other local Charges for services Performing Arts Education Gallery/Museum Investment earnings Memberships and donations Miscellaneous

$

Total revenues EXPENDITURES Current expenditures: Administration Performing Arts Development Marketing Education Gallery/Museum Facilities Total current expenditures

1,065 -

Final

$

1,065

DEFICIENCY OF REVENUES UNDER EXPENDITURES OTHER FINANCING SOURCES (USES) Transfers in Total other financing uses

FUND BALANCE, ENDING

$

10

4,584 924 151 337 142

3,593 1,019 219 39 277 134

(991) 95 68 39 (60) (8)

7,203

7,203

6,320

(883)

623 5,681 257 1,690 1,846 586 161 10,844

623 5,681 257 1,690 1,846 586 161 10,844

605 5,474 248 1,629 1,783 565 154 10,458

18 207 9 61 63 21 7 386

-

-

10,844

10,844

10,458

386

(3,641)

(3,641)

(4,138)

(497)

3,643

4,165

4,165

-

3,643

4,165

4,165

-

2

524

27

259

619

619

NET CHANGE IN FUND BALANCE FUND BALANCE, BEGINNING

(36)

4,584 924 151 337 142

Capital outlay Total expenditures

1,029 10

261

$

The accompanying notes are an integral part of these financial statements.

34

1,143

$

646

(497) $

(497)

CITY OF

ARVADA, COLORADO

PARKS FUND STATEMENT OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCE – BUDGET AND ACTUAL Year Ended December 31, 2013 (in thousands)

Budgeted Amounts Original Final REVENUES Licenses and permits Intergovernmental revenues Jefferson County-Open Space Recovered costs Investment earnings (loss) Miscellaneous

$

Total revenues EXPENDITURES Current expenditures: Park maintenance Park design Total current expenditures

50

DEFICIENCY OF REVENUES UNDER EXPENDITURES OTHER FINANCING SOURCES (USES) Transfers in Transfers out Total other financing sources

FUND BALANCE, ENDING

$

43

(7)

3,537 859 (6) 106

138 (95) (46) 39

4,510

4,510

4,539

29

6,632 774

6,709 774

6,270 779

439 (5)

7,406

7,483

7,049

434

-

40

-

40

7,406

7,523

7,049

474

(2,896)

(3,013)

(2,510)

503

2,884 (3)

2,884 (121)

2,884 (135)

(14)

2,881

2,763

2,749

(14)

(15)

(250)

4,003 $

$

3,399 954 40 67

NET CHANGE IN FUND BALANCE FUND BALANCE, BEGINNING

50

3,399 954 40 67

Capital outlay Total Expenditures

$

Actual Amounts

Variance With Final Budget Positive (Negative)

3,988

4,061 $

The accompanying notes are an integral part of these financial statements.

35

3,811

$

239

489

4,061

-

4,300

$

489

CITY OF

ARVADA, COLORADO

PROPRIETARY FUNDS STATEMENT OF NET POSITION December 31, 2013 (in thousands) Governmental Activities

Business-Type Activities

Water Fund ASSETS CURRENT ASSETS Cash and investments Cash with fiscal agent Accounts receivable, net of allowance for uncollectibles Accrued interest Inventories Prepaid costs Total current assets

$

31,432 36,638

Stormwater Fund

Wastewater fund

$

10,952 -

$

5,746 -

Golf Course

$

351 -

Total Business Type Activities

Food Service

$

472 -

$

48,953 36,638

Internal Service Funds

$

19,983 -

2,129 55 261 63 70,578

2,042 22 6 13,022

338 10 6,094

18 1 116 11 497

193 1 39 3 708

4,720 89 416 83 90,899

5 40 268 282 20,578

NONCURRENT ASSETS Land, water rights & construction in progress Property & equipment, net of accumulated depreciation Total non-current assets Total assets

37,167

5

9,411

4,230

-

50,813

-

122,759 159,926 230,504

41,622 41,627 54,649

34,138 43,549 49,643

3,380 7,610 8,107

885 885 1,593

202,784 253,597 344,496

6,411 6,411 26,989

LIABILITIES CURRENT LIABILITIES Accounts payable Accrued interest Contracts payable Accrued compensated absences

1,651 83 105 212

187 855 43

133 10

158 7 56

100 24

2,229 90 960 345

471 46

Serial bonds payable Bond Premium Claims payable Capital lease payable Unearned revenue Total current liabilities

1,760 104 3,915

1,085

143

145 118 484

6 130

1,760 104 145 124 5,757

808 113 1,438

NONCURRENT LIABILITIES Serial bonds payable Bond Premium Accrued compensated absences

11,855 624 212

44

10

57

24

11,855 624 347

45

Capital lease payable Total non-current liabilities Total liabilities

12,691 16,606

44 1,129

10 153

228 285 769

24 154

228 13,054 18,811

211 256 1,694

NET POSITION Net investment in capital assets Restricted - debt service Unrestricted Total net position

145,583 1,536 66,779 213,898

41,627 11,893 53,520

43,549 5,941 49,490

7,237 101 7,338

885 554 1,439

$

238,881 1,536 85,268 325,685

6,087 19,208 25,295

$

4,375 330,060

$

$

$

$

Adjustment to reflect the consolidation of internal service fund activities related to enterprise funds Net position of business-type activities (page 25) The accompanying notes are an integral part of these financial statements.

36

$

$

CITY OF

ARVADA, COLORADO

PROPRIETARY FUNDS STATEMENT OF REVENUES, EXPENSES, AND CHANGES IN FUND NET POSITION Year Ended December 31, 2013 (in thousands) Governmental Activities

Business-Type Activities

Water Fund OPERATING REVENUES Sales Service charges & fees Recovered costs Miscellaneous Total revenues

$

EXPENSES Operating & maintenance Administration Insurance premiums Uninsured damages & claims Repair & maintenance Depreciation Total expenses

17,841 569 4,225 22,635

Stormwater Fund

Waste-water fund $

11,179 11,179

$

Golf Course

3,254 3,254

$

Food Service

1,490 2,418 13 3,921

$

1,352 1,352

Total Business Type Activities

Internal Service Funds

$

$

20,683 17,420 0 4,238 42,341

7,817 239 28 8,084

15,326 724 3,696 19,746

9,047 665 1,153 10,865

1,021 681 1,702

4,107 118 4,225

1,440 26 49 1,515

30,941 1,415 5,697 38,053

2,746 634 601 2,905 1,521 8,407

2,889

314

1,552

(304)

(163)

4,288

(323)

(1) (302) (530) 104

(39) (664) -

(13) (108) -

(2) (16) -

(1) -

(56) (1,074) (546) 104

(60) 42 (16) -

(729)

(703)

(121)

(18)

(1)

(1,572)

(34)

2,160

(389)

1,431

(322)

(164)

2,716

(357)

CAPITAL CONTRIBUTIONS TRANSFERS IN TRANSFERS OUT

11,540 427 (334)

2,593 (303)

3,500 (2,405)

201 (4)

-

17,633 628 (3,046)

308 (2,074)

CHANGE IN NET POSITION

13,793

1,901

2,526

(125)

(164)

17,931

(2,123)

NET POSITION, BEGINNING

200,252

51,619

46,964

7,463

1,603

27,418

(147)

-

-

-

-

-

OPERATING INCOME (LOSS) NON-OPERATING REVENUES (EXPENSES) Investment earnings (loss) Gain (loss) on sale of assets Interest expense Amortization Total non-operating revenues (expenses)

INCOME (LOSS) BEFORE CONTRIBUTIONS AND TRANSFERS

PRIOR PERIOD ADJUSTMENT NET POSITION, BEGINNING (AS RESTATED) NET POSITION, ENDING

200,105 $

213,898

51,619 $

53,520

46,964 $

Adjustment to reflect the consolidation of internal service fund activities related to enterprise funds Change in net position of business-type activities (page 27) The accompanying notes are an integral part of these financial statements.

37

49,490

7,463 $

7,338

1,603 $

27,418

1,439

$

$

(47) 17,884

25,295

CITY OF

ARVADA, COLORADO

PROPRIETARY FUNDS STATEMENT OF CASH FLOWS Year Ended December 31, 2013 (in thousands) Governmental Activities

Business-Type Activities

Water Fund

Cash flows from operating activities Cash received from external customers $ 22,942 Cash received from internal customers Cash payments to external suppliers (9,445) Cash payments to internal suppliers (585) Cash payments to employees for services (5,525) Net cash provided (used ) by operating activities 7,387 Cash flows from non-capital financing activities Transfers to other funds Transfers from other funds Net cash provided (used ) by non-capital financing activities Cash flows from capital & related financing activities Capital contributions Purchase of capital assets Payment of capital lease Principal paid on capital debt Interest paid on capital debt Proceeds from sale of assets Net cash provided (used) by capital and related financing activities Cash flows from investing activities Investment earnings (loss) Net cash provided (used) by investing activities Net increase (decrease) in cash and cash equivalents Cash and cash equivalents January 1, 2013 Cash and cash equivalents December 31, 2013

Stormwater Fund

Wastewater fund $

11,012 (8,711) (342) (1,110) 849

$

Food Service

Golf Course

3,190 (1,537) (9) (449) 1,195

$

Total Business Type Activities

3,920 (1,773) (257) (2,088) (198)

$

1,256 59 (622) (89) (809) (205)

$

42,320 59 (22,088) (1,282) (9,981) 9,028

Internal Service Funds $

221 7,816 (4,527) (321) (2,083) 1,106

(334) 427

(303) -

(2,405) -

(4) 201

-

(3,046) 628

(2,074) 308

93

(303)

(2,405)

197

-

(2,418)

(1,766)

7,897 (9,725) (1,731) (535) -

849 (2,092) -

(3,212) -

(385) (140) (18) -

(5) -

8,746 (15,419) (1,871) (553) -

(1,622) (108) (20) 126

(4,094)

(1,243)

(3,212)

(543)

(5)

(9,097)

(1,624)

72 72

(35) (35)

(3) (3)

(1) (1)

(1) (1)

32 32

(48) (48)

3,458 64,612 68,070

(732) 11,684 10,952

(4,425) 10,171 5,746

(545) 896 351

(211) 683 472

(2,455) 88,046 85,591

(2,332) 22,315 19,983

Operating income (loss) Adjustments to reconcile operating income to net cash provided (used by operating activities:

2,889

314

1,552

(304)

(163)

4,288

(323)

Depreciation (Increase) decrease in account receivable (Increase) decrease in inventories (Increase) decrease in prepaid expenditures (Decrease) increase in accrued payroll (Decrease) increase in accounts payable (Decrease) increase in claims/bonds payable (Decrease) increase in contracts payable (Decrease) increase in deferred revenue (Decrease) increase in accrued benefits Net cash provided (used) by operating activities Non-cash investing, capital and financing activities Developer Contributions

$

3,696 203 (8) 25 674 (85) (7) 7,387

$

1,153 (167) 2 3 (23) (464) 31 849

$

681 (64) 6 (740) (244) 4 1,195

$

118 (4) (25) 4 9 (5) 2 7 (198)

$

49 (25) (4) (6) (37) (12) (7) (205)

$

5,697 (57) (29) (2) 37 (131) (464) (329) (10) 28 9,028

$

1,521 (3) (16) (21) 71 (128) 5 1,106

$

3,643

$

1,744

$

3,500

$

-

$

-

$

8,887

$

-

Reconciliation of operating income (loss) to net cash provided (used) by operating activities:

The accompanying notes are an integral part of these financial statements.

38

CITY OF

ARVADA, COLORADO

FIDUCIARY FUNDS STATEMENT OF FIDUCIARY NET POSITION December 31, 2013 (in thousands)

Defined Benefit Police Pension ASSETS Pooled cash & investments Local Government Investment Pool Accrued interest Total assets

$

LIABILITIES Escrow payable Total liabilities

365 365

-

NET POSITION HELD IN TRUST FOR PENSION BENEFITS

$

The accompanying notes are an integral part of these financial statements.

39

365

Agency Fund

$

5,553 10 5,563

5,563 5,563

CITY OF

ARVADA, COLORADO

FIDUCIARY FUNDS STATEMENT OF CHANGES IN FIDUCIARY NET POSITION Year Ended December 31, 2013 (in thousands)

Defined Benefit Police Pension ADDITIONS Investment income Funding

$

1 20

Total additions

21

DEDUCTIONS Benefits paid Total deductions

29 29

NET DECREASE

(8)

NET POSITION HELD IN TRUST FOR PENSION BENEFITS BEGINNING OF YEAR

373

END OF YEAR

$

The accompanying notes are an integral part of these financial statements.

40

365

Notes to the Financial Statements

Notes to the Financial Statements

CITY OF

ARVADA, COLORADO

NOTES TO FINANCIAL STATEMENTS December 31, 2013

TABLE OF CONTENTS

1.

Summary of Significant Accounting Policies A. Financial Reporting Entity........................................................................................... 43 Blended Component Units ................................................................................... 43 Discrete Component Units .............................................................................. 43-44 B. Government-Wide and Fund Financial Statements .............................................. 44-45 C. Financial Statement Presentation.......................................................................... 45-47 D. Assets, Liabilities, Deferred Inflows of Resources and Equity 1. Deposits and Investments .................................................................................... 47 2. Receivables and Payables ................................................................................... 48 3. Inventories and Prepaid Items ............................................................................. 48 4. Restricted Assets ................................................................................................. 48 5. Capital Assets ................................................................................................. 48-49 6. Compensated Absences ...................................................................................... 49 7. Long-Term Obligations ........................................................................................ 49 8. Deferred Inflows and Outflows of Resources ................................................ 49--50 9. Fund Equity ..................................................................................................... 50-51 10. Net Position ..................................................................................................... 51-52 11. Estimates ............................................................................................................. 52

2.

Stewardship, Compliance and Accountability A. Budgetary Information ................................................................................................ 52 B. Expenditures/Expenses in Excess of Appropriation ................................................... 52 C. State Constitutional Amendment ........................................................................... 52-53

3.

Detailed Notes on All Funds and Account Groups A. Deposits and Investments ..................................................................................... 54-57 B. Capital Assets ........................................................................................................ 58-59 C. Construction Commitments ........................................................................................ 59 D. Interfund Transactions ........................................................................................... 59-60 E. Long-Term Debt Revenue Bonds ............................................................................................... 61-62 Capital Lease Obligations ............................................................................... 63-64 Changes in General Long-Term Liabilities .......................................................... 64

41

CITY OF

ARVADA, COLORADO

NOTES TO FINANCIAL STATEMENTS December 31, 2013

4.

Other Information A. Risk Management ....................................................................................................... 65 B. Commitments and Contingencies 1. Litigation ............................................................................................................... 66 2. Federal Grants ..................................................................................................... 66 3. AURA Commitments ....................................................................................... 66-67 C. Conduit Debt Obligation ........................................................................................ 67-68 D. Retirement Commitments 1. Defined Benefit Police Pension Plan .............................................................. 68-69 2. City of Arvada Retirement Plan – Defined Contribution Plan .............................. 69 3. Defined Contribution Police Pension Plan ...................................................... 69-70 4. Executive Retirement Plan ................................................................................... 70 E. OPEB ..................................................................................................................... 70-72 F. Related Party Note ..................................................................................................... 72 G. Subsequent Event ...................................................................................................... 72 H. GASB Statement 65 ................................................................................................... 72

42

CITY OF

ARVADA, COLORADO

NOTES TO FINANCIAL STATEMENTS December 31, 2013

1. Summary of Significant Accounting Policies This is a summary of significant accounting policies for the City of Arvada, Colorado presented to assist the reader in interpreting the financial statements and other data in this report. The policies are considered essential and should be read in conjunction with the accompanying financial statements.

A. Financial Reporting Entity The City of Arvada is a political subdivision of the State of Colorado, located in Jefferson and Adams Counties in the northwest quadrant of the greater Denver, Colorado, metropolitan area.

The population of the City is approximately 108,539. The City, incorporated in 1904, provides general government; police services; water; sewer, stormwater; golf; the Arvada Center for the Arts and Humanities; park maintenance; food service; and various trust and agency functions in a fiduciary capacity. The City does not provide fire protection, public education, or solid waste services.

An elected mayor and six-member council govern the City. As required by accounting principles generally accepted in the United States of America (US GAAP) these financial statements present the City and its component units, entities for which the City is considered to be financially accountable. Blended component units, although legally separate entities are, in substance, part of the City's operations and data from these units are combined with data of the City. The discretely presented component units, on the other hand, are reported in separate columns in the government-wide statements to emphasize they are legally separate from the City. Each blended and discretely presented component unit has a December 31 year-end.

Blended Component Units Arvada Housing Authority (Special Revenue Fund) – The Authority administers funds received for rent subsidy to low/moderate income households under Section 8 of the U.S. Housing Assistance Payment Program. The City provides all administrative support to the Authority. The Authority, a legally separate entity, is governed by a Board of Directors, which consists of all current members of the Arvada City Council. Separate audited financial statements for the Arvada Housing Authority are not prepared.

Arvada Council of the Arts and Humanities (Arts Council) (Special Revenue Fund) – The Arts Council is a registered 501(c) (3) organization. Its role is to advise the Arvada City Council, provide guidance and support to the Arvada Center staff and act as an advocate for public support and funding for the Arvada Center. The Council is governed by a Board which is appointed by the Arvada City Council. Separate audited financial statements for the Arts Council are not prepared.

Discrete Component Units Arvada Urban Renewal Authority (AURA) – AURA is reported in a separate column as a discrete component unit presentation to emphasize that it is legally separate from the City.

AURA was created by Ordinance No. 1717 under the Colorado Urban Renewal Law and was approved by the voters on March 3, 1981. Its purpose is to develop, redevelop or rehabilitate blighted areas of the City. AURA currently has five active project areas, Ralston Fields, Jefferson Center Metropolitan District (JCMD), Village Commons, Olde Town Station and Northwest Arvada. The governing body of the AURA is a commission of seven members, appointed by the

43

CITY OF

ARVADA, COLORADO

NOTES TO FINANCIAL STATEMENTS December 31, 2013

Mayor and approved by City Council for staggered terms of five years. AURA's annual budget must be approved by the City Council and the City provides administrative support to the AURA. AURA is included in the City's financial statements due to the City's ability to appoint AURA's governing authority and approve the budget and its revisions. The City does not have any responsibilities to fund AURA operating deficiencies or deficits. Tax revenues are imposed and collected by the City.

Separate audited financial statements for AURA may be obtained from the City.

Arvada Economic Development Association (AEDA) – AEDA is reported in a separate column as a discrete component unit presentation to emphasize that it is legally separate from the City.

AEDA financial statements consist of one governmental fund.

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. The City has implemented GASB Statement 61, The Financial Statement Reporting Entity, and we believe that AEDA is included as a discrete component unit in the City's financial statements for the following reasons: the City funds all of the operations of AEDA, the City Council appoints six members of the board.

B. Government-Wide and Fund Financial Statements The government-wide financial statements (i.e., the statement of net position and the statement of activities) report information on all the non-fiduciary activities of the City and its component units. For the most part, the effect of interfund activity has been removed from these statements.

Governmental activities, which are normally supported by taxes and intergovernmental revenues, are reported separately from business-type activities, which rely to a significant extent on fees and charges for support. Likewise, the City is reported separately from certain legally separate component units for which the primary government is financially accountable.

The statement of activities demonstrates the degree to which the direct expenses of a given function or segment is offset by program revenues. Direct expenses are those that are clearly identifiable with a specific function or segment. Program revenues include 1) charges to customers or applicants who purchase, use, or directly benefit from goods, services, or privileges provided by a given function or segment and 2) grants and contributions that are restricted to meeting the operational or capital requirements of a particular function or segment. Taxes and other items not properly included among program revenues are reported instead as general revenues.

Separate financial statements are provided for governmental funds, proprietary funds, and fiduciary funds, even though the latter are excluded from the government-wide financial statements. Major individual governmental funds and major enterprise funds are reported as separate columns in the fund financial statements.

44

CITY OF

ARVADA, COLORADO

NOTES TO FINANCIAL STATEMENTS December 31, 2013

Measurement Focus and Basis of Accounting The government-wide financial statements are reported using the economic resources measurement focus and the accrual basis of accounting, as are the proprietary fund and trust fund financial statements. Revenues are recorded when earned and expenses are recorded when a liability is incurred, regardless of the timing of related cash flows. Property taxes are recognized as revenues in the year for which they are levied. Grants and similar items are recognized as revenue as soon as all eligibility requirements imposed by the provider have been met.

Government fund financial statements are reported using the current financial resources measurement focus and modified accrual basis of accounting. Revenues are recognized as soon as they are both measurable and available. Revenues are considered to be available when they are collectible within the current period or soon enough thereafter to pay liabilities of the current period. For this purpose, the City considers revenues to be available if they are collected within 60 days of the end of the current fiscal period. Expenditures generally are recorded when a liability is incurred, as under accrual accounting. However, debt service expenditures, as well as expenditures related to compensated absences and judgments, are recorded only when payment is due.

Taxes, franchise fees, licenses, and interest associated with the current fiscal period are all considered to be susceptible to accrual and so have been recognized as revenues of the current fiscal period. Only the portion of special assessments receivable due within the current fiscal period is considered to be susceptible to accrual as revenue of the current period. All other revenue items are considered to be measurable and available only when cash is received by the government.

Agency funds use the accrual basis of accounting.

C. Financial Statement Presentation The accounts of the City are organized and operated on the basis of funds, each of which is considered a separate accounting entity. A fund is an independent fiscal and accounting entity with a self-balancing set of accounts that comprise its assets, liabilities, fund equity, revenues and expenditures or expenses as appropriate. The various funds are summarized by type within the financial statements.

The City reports the following major governmental funds: The General Fund is the City’s primary operating fund. It accounts for all financial resources of the general government, except those required to be accounted for in another fund.

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.

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 transfer from the City’s General Fund.

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

45

CITY OF

ARVADA, COLORADO

NOTES TO FINANCIAL STATEMENTS December 31, 2013

derived from the City’s General Fund, Grants Fund, Lands Dedicated Fund and Jefferson County Open Space funds.

The General Capital Projects Fund accounts for all major capital projects of the City.

Appropriations are not restricted to a fiscal year. Sources of revenue to this fund are transfers from contributions from the General and other funds, interest earned, transfers from Jefferson County Open Space funds and contributions by developers and government grants.

The City reports the following major proprietary funds: The Water Fund accounts for all activity within the scope of water utility operations. Water service is available within the City limits and is extended to some residents of the county and adjacent cities. All activities necessary to provide such service are accounted for in this fund, including administration, operations, capital water projects, maintenance, financing and related debt service, and billing and collection.

The Wastewater Fund accounts for all activities necessary in the collection, transmission, and disposal of sewage and wastewater. It includes administration, operations, capital maintenance, financing and billing and collection.

The Stormwater Fund accounts for all activities necessary to maintain a stormwater management plan. It includes administration, operations, capital maintenance and billing and collection.

The Golf Course Fund accounts for all revenues and expenses of the Lake Arbor and West Woods Golf Courses, including food service operations. It includes administrative, operations, maintenance, financing and related debt service at Lake Arbor and West Woods Golf Courses.

Food service activities include restaurant operations at the West Woods and Lake Arbor Golf Courses.

The Food Service 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.

Government and enterprise fund types that do not meet the criteria of major funds have been summarized and presented as other governmental funds and other enterprise funds, respectively within the fund financial statements.

Additionally, the City reports the following fund types: Internal Service Funds are used to account for the City’s fleet and information technology replacement, risk management insurance program, printing services and building and fleet maintenance services.

The City reports the following fiduciary funds: The Pension Trust Fund is used to account for the City’s defined benefit police pension trust to provide retirement benefits for one retiree that did not elect to join the new plan formed in 1986.

Agency Fund is used to account for a variety of deposits from various sources held in escrow.

As a general rule, the effect of interfund activity has been eliminated from the government-wide financial statements. Exceptions to this rule are the charges between the City’s enterprise

46

CITY OF

ARVADA, COLORADO

NOTES TO FINANCIAL STATEMENTS December 31, 2013

operations and various other functions. Elimination of these charges would distort the direct costs and program revenues reported for the various functions concerned.

Proprietary funds distinguish operating revenues and expenses from non-operating items.

Operating revenues and expenses generally result from providing services and producing and delivering goods in connection with a proprietary fund’s principal ongoing operations. Operating expenses for enterprise and internal service funds include cost of sales and services, administrative expenses, and depreciation on capital assets. All revenues and expenses not meeting this definition are reported as non-operating revenues and expenses.

When both restricted and unrestricted resources are available, it is the City’s practice to use restricted resources first, then unrestricted resources as they are needed.

D. Assets, Liabilities, Deferred Inflows of Resources and Equity 1) Deposits and Investments The City's cash and cash equivalents are considered to be cash on hand, demand deposits and short-term investments with original maturities of three months or less from the date of acquisition.

The City pools cash resources of most funds to facilitate the management of cash. Cash applicable to a particular fund is readily identifiable. The balance in the pooled cash accounts is available to meet current operating requirements. Cash in excess of current requirements is invested in various interest-bearing securities and disclosed as part of the City's investments.

Cash overdrafts from pooled cash and investments are reported as an interfund receivable/payable.

Colorado statutes require that the City use an eligible public depository as defined by the Public Deposit Protection Act (PDPA). Under the Act, the depository is required to pledge a pool of eligible collateral having a market value at all times equal to at least 102% of the aggregate public deposits held by the depository not insured by Federal Depository Insurance. The pool for all the uninsured public deposits as a group is to be maintained by another institution or held in trust. Each institution designated as a public depository can be assessed a portion of the losses of a public entity's deposits in a failed public depository.

Thus, all public deposits are fully collateralized. Eligible collateral as defined by the Act primarily includes obligations of, or guaranteed by, the U.S. Government, the State of Colorado or any subdivision thereof and obligations evidenced by notes received by first lien mortgages or deeds of trust on real property.

Investments are reported at fair value. The fair value of the City’s investments is based upon values provided from quoted market prices.

47

CITY OF

ARVADA, COLORADO

NOTES TO FINANCIAL STATEMENTS December 31, 2013

2) Receivables and Payables Transactions between funds that are representative of lending/borrowing arrangements outstanding at the end of the fiscal year are referred to as either "interfund receivables/payables" (i.e., the current portion of interfund loans) or "advances to/from other funds" (i.e., the non-current portion of interfund loans). All other outstanding balances between funds are reported as "due to/from other funds". On the Statement of Net Position, residual balances between governmental and business type activities are reflected as internal balances.

Receivables are shown net of an allowance for uncollectibles, where applicable.

Property taxes attach an enforceable lien on the property as of January 1 and are levied on the following January 1. Taxes are payable the following year in one installment made on or before April 30, or in two installments made on or before February 28 and June 15. The assessments and collections are made by Jefferson County and Adams County and are remitted monthly to the City. City property tax revenues certified in December are recorded as a receivable and an offsetting deferred inflow of resources.

The City records non-current receivables for interfund and other long-term notes on the Statement of Net Position of its Proprietary Fund Types. Within the governmental funds, all non-current receivables are fully offset by deferred inflow of resource if the payment resulting in the receivable was originally recorded as an expenditure. Otherwise non-current receivables are fully offset by a restriction of fund balance. Non-current receivables and other long-term notes are shown on the statement of net position of the government-wide statements.

3) Inventories and Prepaid Items Inventories are valued at cost using the first-in/first-out (FIFO) method with the exception of the City's central supply inventory which is valued at average cost. The cost of inventories is recorded as expenditures when consumed rather than when purchased.

Certain payments to vendors reflect costs applicable to future accounting periods and are recorded as prepaid costs in both government-wide and fund financial statements.

4) Restricted Assets The City first applies restricted resources when an expense is incurred for purposes for which both restricted and unrestricted net position are available. Certain assets of the Community Development Block Grant special revenue fund are restricted because their use is completely restricted by grant agreements. Certain assets of the Arvada Center special revenue fund are restricted because their use is restricted by actor agreements. Certain assets of the Capital Projects fund are restricted because their use is restricted for use by specified projects.

5) Capital Assets Capital assets which include property, plant, equipment, and all infrastructure assets (e.g. roads, bridges, sidewalks, and similar items), are reported in the applicable governmental or business-type activities column in the government-wide financial statements and in the Proprietary Funds in the fund financial statements. Capital assets are defined by the City as assets with an initial, individual cost of more than $5,000 and an estimated useful life in 48

CITY OF

ARVADA, COLORADO

NOTES TO FINANCIAL STATEMENTS December 31, 2013

excess of three years. Such assets are recorded at historical costs or estimated historical cost if purchased or constructed. Donated assets are recorded at estimated fair market value at the date of donation.

The costs of normal maintenance and repairs that do not add to the value of the asset or materially extend assets lives are not capitalized.

Capital assets other than land and water rights are depreciated. Depreciation is computed using the straight-line method with estimated useful lives as follows: Assets Buildings Road system infrastructure Other improvements Other infrastructure Equipment Vehicles

Years 50 25 20 8-50 5-10 3-5

6) Compensated Absences It is the City's policy to permit employees to accumulate earned but unused vacation and sick pay benefits. No liability is reported for unpaid accumulated sick leave since benefits are not paid upon termination. Vacation pay is accrued when earned in the government-wide and proprietary fund financial statements. The compensated absences are only reported in governmental funds if they are due. Compensated absences of the governmental activities are expected to be liquidated primarily with revenues of the General Fund.

7) Long-Term Obligations In the government-wide financial statements and proprietary fund types in the fund financial statements, long-term debt and other long-term obligations are reported as liabilities in the applicable governmental activities, business-type activities, or proprietary fund type statement of net position. Debt premiums and discounts are deferred and amortized over the life of the debt using the effective interest method. Debts payable are reported net of the applicable debt premium or discount.

In the fund financial statements, governmental fund types recognize debt premiums and discounts, as well as debt issuance costs, during the current period. The face amount of the debt issued is reported as other financing sources. Premiums received on debt issuances are reported as other financing sources while discounts on debt issuances are reported as other financing uses. Issuance costs, whether or not withheld from the actual debt proceeds received, are reported as debt service expenditures.

8) Deferred Inflows and Outflows of Resources A deferred inflow of resources is an acquisition of net position that is applicable to a future reporting period. A deferred outflow of resources is a consumption of net position that is applicable to future reporting period. The City did not have a deferred outflow of resources during 2013.

Under the modified accrual basis of accounting, revenues and other fund financial resources are recognized in the period in which they become measurable and available. Assets recorded in the fund financial statements in which revenues are not available are recorded as 49

CITY OF

ARVADA, COLORADO

NOTES TO FINANCIAL STATEMENTS December 31, 2013

a deferred inflow of resources. Property tax receivables are reported as a deferred inflow of resources when levied in the fund statements.

Deferred inflows of resources include property tax, grants receivable, and notes receivable that are unavailable in the fund statements but are recognized as revenue in the governmentwide statements.

9) Fund Equity The City previously adopted the standards of Governmental Accounting Standards Board Statement No. 54, Fund Balance Reporting and Government Fund Type Definitions (GASB 54), for the year ending December 31, 2011. This Statement defines the different types of fund balances that a governmental entity must use for financial reporting purposes. The classifications are designed based on the relative strength of the constraints that control how specific amounts can be spent, or the inability to be spent such as inventories and prepaids.

When expenditures are incurred that use funds from more than one classification, the City will generally determine the order which the funds are used on a case-by-basis basis, taking into account any application requirements or grant agreements, contracts, business circumstances or other constraints. If no other constraints exist, the order of spending of resources will be restricted, committed, assigned and lastly, unassigned.

GASB 54 requires the fund balance amounts to be properly reported within one of the fund balance classifications listed below: 1. Nonspendable - fund balance associated with inventories, prepaids, long-term loans and notes receivable, and property held for resale (unless the proceeds are restricted, committed or assigned) 2. Restricted – fund balance that can be spent only for specific purposes stipulated by constitution, external resource providers or through enabling legislation.

3. Committed – fund balance that can be spent for specific purposes through ordinance or resolution adopted by the City Council. This classification also includes contractual obligation to the extent that existing resources in the fund have been specifically committed for use in satisfying contractual requirements.

4. Assigned – fund balance that can be spent for specific purposes authorized by the City Manager.

5. Unassigned – fund balance that is the residual classification that does not meet any of the other classifications and is used for the General Fund only.

The following table illustrates the current fund balance amounts associated with each major fund and the non-major funds in the aggregate:

50

CITY OF

ARVADA, COLORADO

NOTES TO FINANCIAL STATEMENTS December 31, 2013

General Fund $ 289 351 640

Community Development Fund $ -

Arvada Center Fund $ 118 47 165

Parks Fund $ 10 37 47

Capital Projects Fund $ -

Other Governmental Funds $ 19 19

Total Governmental Funds $ 299 118 454 871

2,028 2,028

32 1,336 1,368

184 58 38 36 316

136 136

169 186 453 1,041 1,849

1,243 7,720 264 350 85 452 2,337 12,451

1,243 7,720 264 2,899 58 1,336 85 452 2,337 186 453 1,041 38 36 18,148

Committed Capital - Arvada Center Capital - General Capital - Parks Capital - Streets Capital - Traffic Total Committed

-

-

-

-

109 4,550 4,275 2,216 3,803 14,953

-

109 4,550 4,275 2,216 3,803 14,953

Assigned Capital - Arvada Center Capital - General Capital - Buildings Capital - Parks Capital - Streets Capital - Traffic Community Development Parks Arvada Center

-

5,528 -

165 -

4,117 -

625 14,315 835 4,450 5,988 2,291 -

-

625 14,315 835 8,567 5,988 2,291 5,528 165 -

23,007 25,675

5,528 6,896

165 646

4,117 4,300

28,504 $ 45,306

-

38,314 23,007 95,293

Fund Balances: Nonspendable: Inventories Endowments Prepaid Total Nonspendable Restricted: Conservation Trust Voter restricted sales tax - police Seizure Funds Emergencies - Tabor Donor intentions Community Development Housing Debt service Lands Dedicated Adams County Open Space Adams County Transportation Park Development Fees Scholarships & Grants Letter of Credit Total Restricted

Total Assigned Unassigned Total Fund Balances

$

$

$

$

$

12,470

$

10) Net Position Net position represents the difference between assets and deferred inflows of resources, liabilities and deferred inflows of resources. Net investment in capital assets consists of capital assets, net of accumulated depreciation, reduced by the outstanding balances of any borrowing used for the acquisition or construction of improvements of those assets. Net position is reported as restricted when there are limitations imposed on its use either through the enabling legislation adopted by the City or through external restriction imposed by creditors, grantors, laws, or regulations of other governments.

51

CITY OF

ARVADA, COLORADO

NOTES TO FINANCIAL STATEMENTS December 31, 2013

In November, 1992, Colorado voters passed Article X, Section 20 to the State Constitution, described in Note 2B. The Amendment requires that a percentage of fiscal year spending, excluding bonded debt service, be legally restricted to be used for declared emergencies only. This amount is reflected on the government-wide statement of net position as net position – reserved for emergencies. The amendment requires a three percent emergency reserve at December 31, 1995 and thereafter. An emergency is defined in the Amendment as an event, which excludes economic conditions, revenue shortfalls, salary or fringe benefit increases.

11) Estimates The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect amounts reported in the financial statements and accompanying notes. Actual results may differ from those estimates.

2. Stewardship, Compliance and Accountability A. Budgetary Information Annual budgets are adopted on a basis consistent with US GAAP for all governmental funds except the capital projects fund, which adopts project-length budgets. All other annual appropriations lapse at fiscal year-end. Proprietary Funds are budgeted on a non-GAAP basis due to the budgeting of capital outlay and not depreciation. Budgetary financial statements do not include the general Capital Projects Fund because the projects accounted for in that fund span multiple years. Budgets are also not adopted for the Fiduciary funds.

Not less than sixty days prior to the first day of the next fiscal year, Council adopts the City budget by resolution and the annual appropriation by ordinance. The City prepares a combination line item and program budget, but the level of control is at the fund level which is the amount approved by ordinance. For budgetary, appropriation and reporting purposes, interfund transfers are considered to be revenues or expenditures.

Both the adopted budget and the level of appropriation (by fund) can be amended during the budget year. This action requires Council approval in the form of a resolution for a budgetary amendment and by ordinance requiring a public hearing for an increase in appropriations.

Intrafund budgetary transfers between departments within a fund can be accomplished with the approval of the Manager.

B. Expenditures/Expenses in Excess of Appropriation For the year ended December 31, 2013, the Golf Fund expenditures exceeded the amounts budgeted by $36,000. This may be violation of state statue.

C. State Constitutional Amendment On November 3, 1992, the voters of the State approved Article X, Section 20 to the State Constitution (the Amendment) limiting growth of public entities and their ability to borrow and tax.

Enterprises, defined as government-owned businesses authorized to issue revenue bonds and receiving less than 10% of its annual revenue in grants from all state and local governments combined, are excluded from the provisions of the Amendment. The City's management is of the 52

CITY OF

ARVADA, COLORADO

NOTES TO FINANCIAL STATEMENTS December 31, 2013

opinion that it’s Water, Wastewater, Stormwater, Golf and Food Service operations qualify for this exclusion.

The initial revenue base is 1992 fiscal year spending. Future revenue limits are determined based upon the prior year's fiscal year spending adjusted for a growth factor based upon inflation and changes in the actual value of real property within its boundaries. Excluded revenues such as gifts and federal funds are not used to calculate the limit. Revenue in excess of the limit must be refunded unless the voters approve retention of such revenue.

On November 5, 1996, the qualified electors of the City approved Resolution R-96-127, which reads as follows: Without creating any new tax or increasing any current taxes, shall the City of Arvada be permitted, in 1996 and each year thereafter, to retain and spend City revenues in excess of the spending, revenue raising, or other limits in Article X, Section 20 or the Colorado Constitution, utilizing such revenues for public safety, municipal services, transportation and other public improvements, parks and recreational facilities, and any other lawful public purpose?

The Amendment requires, with certain exceptions, voter approval prior to imposing new taxes, increasing a tax rate, imposing a mill levy that will produce property tax revenue in excess of the amount collected in the previous year adjusted by the growth factor, extending an expiring tax, or implementing a tax policy change which directly causes a net tax revenue gain.

Except for bond refinancing at lower interest rates or adding employees to existing pension plans, the Amendment specifically prohibits the creation of multiple fiscal year debt or other financial obligations without voter approval and without irrevocably pledging present cash reserves for all future payments.

The City believes it is in compliance with the requirements of the Amendment. However, due to the broad general terms of the Amendment, the City has been required to make certain interpretations of the Amendment's language in order to determine its compliance. Ultimately, the courts may be required to determine the appropriate interpretations of the Amendment's terms and provisions.

53

CITY OF

ARVADA, COLORADO

NOTES TO FINANCIAL STATEMENTS December 31, 2013

3. Detailed Notes on Funds and Account Balances A. Deposits and Investments As of December 31, 2013, the City's cash deposits had a carrying value of $31,842,030. The bank balances were $34,601,518 of which $1,035,646 was covered by federal deposit insurance and $33,565,872 was collateralized with securities held by the pledging financial institution’s trust department or agent in the City’s name. Cash with fiscal agent had a balance of $36,637,784.

These funds are held in escrow for the Gross Reservoir Enlargement project with Denver Water.

These funds are invested in instruments which follow the City’s investment policies and procedures.

Investment policies are governed by the City’s investment policies and procedures and State Statutes. Investments of the City and AEDA may include: • •

• • • • •

Local government investment pools authorized under the laws of the State of Colorado whose investment policy closely mirrors that of the City.

Direct obligations of the United State government, including such instruments as Treasury Bills, Treasury Notes, Treasury Bonds, Export Import Bank issues, Farmers Home Administration Insured Notes, certain scaled discount notes, and certain relatively shortterm securities issued by the Government National Mortgage Association.

Obligations of certain U.S. Government agencies, including but not limited to such instruments as Federal Home Loan Bank debt, Federal National Mortgage Association debt, certain scaled discount notes, and/or certain short-term Federal Farm Credit debt.

Purchases of the direct or agency securities mentioned above, under the terms of a repurchase agreement or in support of a City “Sweep Account” which meet the City’s procedures for the delivery, possession and safekeeping of investment securities.

Repurchase agreements Commercial paper and certificates of deposits AAA-rated money market funds

Investments of the employee pension plans are determined contractually with the third-party custodian. The plans currently contain a wide range of money market and mutual funds and are not subject to the City’s investment policies.

Interest Rate Risk The City’s investment policy does not specifically address Interest Rate Risk. The State Statutes requires 3 or 5 years depending on the investment. In practice, the City does not purchase any investments with a maturity of longer than 5 years with all “money market instruments” having a maturity of one year or less. The City assumes its investments will be held to maturity and callable investments may or may not be called.

Credit Risk The City’s general investment policy is to apply the prudent-person rule: Investments are made as a prudent person would be expected to act, with discretion and intelligence, to seek reasonable income, preserve capital, and, in general, avoid speculative investments. The State Statutes specify rating requirements depending on the investment. All corporate bonds have AA or higher ratings.

Concentration of Credit Risk As a means of limiting its exposure, the City’s total investment in any specific money market or mutual fund shall not exceed 10% of the total assets of such fund class. At December 31, 2013, 54

ARVADA, COLORADO

CITY OF

NOTES TO FINANCIAL STATEMENTS December 31, 2013

the City's investments in the Federal Home Loan Bank (FHLB), Federal Home Loan Mortgage Corporation (FHLMC), Federal National Mortgage Association (FNMA), and Federal Farm Credit Bank (FFCB) are 37.22%, 5.80%, 19.58% and 24.7% of total investments, respectively.

Custodial Credit Risk Custodial credit risk is the risk that in the event of a bank failure, the government’s deposits may not be returned to it. The City’s investment policy requires commercial banks and savings and loan associations to be eligible public depositories within the meaning of the Colorado Revised Statues of PDPA and S&L PDPA. The depositories will also have to possess overall financial strength, capitalization and liquidity to ensure the safety and availability of such monies. The assessment of this overall financial strength shall be made applying generally accepted industry standards (i.e. capital requirements, asset quality, earnings and liquidity) using available public agency and private rating services as appropriate.

Local Government Investment Pool At December 31, 2013, the City had invested in the Colorado Local Government Liquid Asset Trust (Colotrust) and the Colorado Surplus Asset Fund Trust (CSAFE). These investment vehicles were established for local government entities in Colorado to pool surplus funds. The State Securities Commissioner administers and enforces the requirements of creating and operating these pools. Their operation is similar to a money market fund with each share equal in value to $1.00. Investments of these entities are limited to those allowed by State statutes. A designated custodial bank provides safekeeping and depository services in connection with the direct investment and withdrawal functions. Substantially all securities owned are held by the Federal Reserve Bank in the account maintained for the custodial bank. The custodian's internal records identify the investments owned by the participating governments.

Money Market Funds As of December 31, 2013, the City invested in the PFM Funds Prime Series, Colorado Investors Class, a money market mutual fund (marketed as the Colorado Statewide Investment Program or CSIP). The Prime Series is a separate investment portfolio of PFM Funds (the Trust). The Trust is an open-end, diversified, management investment company registered under the Investment Company Act of 1940. The PFM Funds Prime Series invests in obligations of the United States Government and its agencies, high quality debt obligations of U.S. companies and obligations of financial institutions and is rated AAAm by Standard & Poor’s. PFM Asset Management, LLC serves as the investment advisor, administrator and transfer agent. Shares of the Fund are distributed by PFM Fund Distributors, Inc., member Financial Industry Regulatory Authority (FINRA). U.S. Bank N.A. serves as the custodian and acts as safekeeping agent.

Cash and Investments reported on the financial statements as of December 31, 2013: Cash and Investments Cash with Fiscal Agent Restricted Cash Total per Statement of Net Position

$ 158,937 36,638 4,192 $ 199,767

Agency Fund Police Pension Defined Benefit Total Financial Statement Cash & Investments

5,553 365 $ 205,685

Carrying value of cash Cash with Fiscal Agent Fair market value of investments Total value cash and investments

31,841 36,638 137,206 $ 205,685 55

CITY OF

ARVADA, COLORADO

NOTES TO FINANCIAL STATEMENTS December 31, 2013

AURA Investment Policy Investments AURA is required to comply with State statutes which specify instruments meeting defined rating, maturity, and concentration risk criteria in which units of local government may invest. In addition, AURA has an investment policy in which seeks to ensure the preservation of capital in the overall portfolio.

Per AURA’s investment policy, funds of AURA may be invested in: • U.S. Treasury Securities.

• Obligations of the U.S. Government agencies (including FDIC and FSLIC insured transactions up to $100,000).

• Certificates of deposit and other evidences of deposit or investment at banks, savings and loan associations and other state or federally regulated financial institutions subject to PDPA (5%) and a minimum net worth of any bank of $10,000,000 and a minimum net worth of any savings and loan association of $15,000,000.

• Repurchase agreements made in compliance with Revised Colorado State Statute 24-36113. Repurchase collateral will be perfected and delivered to the Trustee. Repurchase agreements must be collateralized at a minimum of 100% of the purchase price of the repurchase agreement and market-to-market on a weekly basis. All repurchase agreements shall be evidenced by a master repurchase agreement between AURA and securities dealer.

• Money market funds. Investments with any financial institutions which have appeared in any published watch list during a 12-month period preceding the investment date in an amount greater than $100,000 is specifically prohibited.

AURA's investment policy follows State statutes, but places additional limits on investment maturities and custodial credit risk.

Interest Rate Risk – AURA's investment policy limits the maturity of investment instruments or fixed-income securities to a maximum of three years except for reserve funds which are invested subject to agreements tailored to bond indentures, when applicable.

Credit Risk – State statutes limit investments in money market funds to those that maintain a constant share price, with a maximum remaining maturity in accordance with Rule 2a-7, and either have assets of one billion dollars or the highest rating issued by a nationally recognized organization that regularly rates such obligations. At December 31, 2013, AURA's investment in the Dreyfus Government Cash Management money market fund of $1,601,457 was rated AAA by Moody’s and have a weighted average maturity of less than one year.

Custodial Credit Risk – AURA's investment policy requires that investments be placed with two or more financial institutions and in such amounts or proportions of total investments or assets as may be reasonable and prudent.

Concentration of Credit Risk – State statutes generally do not limit the amount AURA may invest in one issuer.

56

CITY OF

ARVADA, COLORADO

NOTES TO FINANCIAL STATEMENTS December 31, 2013

As of December 31, 2013, the City had the following investments and maturities:

Asset Category Local Government Investment Pool Trust Funds

Credit Quality Per Moody's or Standard & Poor's

AAA

U.S. Treasuries

Fair Value

>1 yr and <= 2 yrs.

<= 1 year

>2 yrs and <= 3 yrs.

>3 yrs and <= 4 yrs.

>4 yrs and <= 5 yrs.

% of total

9,892,081

9,892,081

-

-

-

-

7.21%

2,024,922

2,024,922

-

-

-

-

1.48%

U.S. Agencies FHLB FHLMC FNMA FFCB Subtotal for U.S. Agencies

AAA AAA AAA AAA

51,072,913 7,955,900 26,864,277 33,885,370 119,778,460

-

2,066,974 4,996,300 14,992,656 22,055,929

12,959,209 13,007,445 10,972,193 36,938,846

17,773,021 10,865,383 7,920,522 36,558,926

18,273,709 2,959,600 2,991,450 24,224,759

37.22% 5.80% 19.58% 24.70%

Money Market

AAA

1,012,960

1,012,960

-

-

-

-

0.74%

Corporate Bonds

AA+

4,497,760 4,497,760

-

-

4,497,760 4,497,760

-

-

3.28%

Subtotal for Corporate Bonds

Total for all Asset Categories

137,206,182

12,929,963 22,055,929 41,436,606 36,558,926 9.42% 16.08% 30.20% 26.65%

24,224,759 17.66%

100.00%

As of December 31, 2013 AURA’s cash deposits had carrying values of $1,727,635. The bank balances were $1,730,192 of which $663,216 was covered by the federal deposit insurance and $1,066,976 was collateralized with securities held by the pledging financial institution’s trust department or agent in AURA’s name.

As of December 31, 2013 AEDA’s cash deposits had carrying values of $875,781. The bank balances were $875,781 of which $728,599 was covered by the federal deposit insurance and $147,182 was collateralized with securities held by the pledging financial institution’s trust department or agent in AEDA’s name.

57

CITY OF

ARVADA, COLORADO

NOTES TO FINANCIAL STATEMENTS December 31, 2013

B. Capital Assets A summary of changes in capital asset activity for the year ended December 31, 2013 follows (in thousands): Balance January 1, 2013 Primary Government: Governmental activities Capital assets not being depreciated: Land Construction in progress Total capital assets, not being depreciated Capital assets, being depreciated: Buildings Improvements other than buildings Equipment & Vehicles Infrastructure Total capital assets being depreciated

$

Less accumulated depreciation for: Buildings Improvements other than buildings Equipment & Vehicles Infrastructure Total accumulated depreciation Total capital assets, being depreciated, net Governmental activities capital assets, net

$

Additions

53,259 16,972 70,231

$

$

$

(4,857) (4,857)

34,078 80,969 24,469 383,408 522,924

126 1,602 5,593 7,321

(1,285) (1,285)

(16,406) (19,313) (17,807) (251,911) (305,437)

(687) (3,215) (1,611) (7,571) (13,084)

1,191 1,191

217,487

(5,763)

287,718

$

Balance January 1, 2013 Business-type activities Capital assets not being depreciated: Water rights Land Construction in progress Total capital assets, not being depreciated

16,402 16,402

Retirements

10,639

Additions

27,338 8,170 7,125 42,633

$

4,004 5,874 9,878

$

(4,951)

Retirements

$

(130) (130)

15,017 254,551 3,281 7,155 280,004

14,272 156 14,428

(1,912) (123) (2,035)

Less accumulated depreciation for: Buildings Improvements other than buildings Equipment & Vehicles Infrastructure Total accumulated depreciation

(7,576) (76,307) (2,304) (340) (86,527)

(289) (5,051) (214) (143) (5,697)

934 123 1,057

Total capital assets, being depreciated, net

193,477

8,731

$

236,110

$

58

18,609

Balance December 31, 2013

$

$

(1,108)

(17,093) (22,528) (18,227) (259,482) (317,330)

6,556 $

14

53,259 21,975 75,234 34,078 85,937 25,136 390,365 535,516

-

218,186 $

293,420

Transfers To (From) CIP

Balance December 31, 2013

$

$

(1,568) (1,568)

1,522 32 1,554

(7,865) (80,424) (2,395) (483) (91,167)

1,554 $

(14)

31,342 8,170 11,301 50,813

15,017 268,433 3,346 7,155 293,951

-

(978) $

(6,542) (6,542) 4,842 350 1,364 6,556

(94)

Capital assets, being depreciated: Buildings Improvements other than buildings Equipment & Vehicles Infrastructure Total capital assets being depreciated

Business-type activities capital assets, net

Transfers To (From) CIP

202,784 $

253,597

CITY OF

ARVADA, COLORADO

NOTES TO FINANCIAL STATEMENTS December 31, 2013

Depreciation expense was charged to functions/programs of the primary government as follows (in thousands): Governmental Business-Type Activities Activities General government $3,210 $ Public safety – police & judicial 82 Public works 7,579 Parks 367 Culture 325 Internal Service 1,521 Water 3,696 Wastewater 1,153 Stormwater 681 Golf 118 Food 49 Total depreciation expense $ 13,084 $ 5,697 C. Construction Commitments The City has active construction projects as of December 31, 2013. The projects include streets, traffic, parks, golf, general construction and water and stormwater system projects.

At year end the City’s commitments with contractors are as follows (in thousands):

Streets construction Parks construction Water system Total

Project Spent-to-Date $ 210 3,887 1,252 $ 5,349

Remaining Commitment $ 53 1,801 1,263 $ 3,117

D. Interfund Transactions There was one “due from” and one “due to” balance as of December 31, 2013. The Arvada Housing Authority owes the General Fund $22,297 for expenditures paid on its behalf.

Transfers to/from other funds for the year ended December 31, 2013 were as follows (in thousands): Fund

Transfers In

Transfers Out

General Fund Community Development Fund Arvada Center Parks Capital Projects Fund Non-major Governmental Funds Water Fund Wastewater Fund Stormwater Fund Golf Course Fund Internal Service Funds

$

45 4,165 2,884 11,467 1,549 427 201 308

$ 13,173 381 135 2,237 334 303 2,405 4 2,074

Total

$21,046

$21,046

59

CITY OF

ARVADA, COLORADO

NOTES TO FINANCIAL STATEMENTS December 31, 2013

The General Fund transfers out include support transfers to the Arvada Center, Parks, Community Development and Golf Course Funds, a capital transfer to the Capital Projects Fund, debt transfers to the Bond and COP Funds and the Building Fund for energy payments.

The Community Development Fund transfer in is from the General Fund to meet operations and the transfer out is to the Housing Fund to offset administrative costs.

The Arvada Center Fund transfer in is from the General Fund to meet on-going operations.

The Parks Fund transfer in is from the General Fund to meet operations. The transfer out is a capital transfer to the Capital Projects Fund and vehicle fund.

The Capital Projects Fund transfers in are for current and future capital projects. This year the General, Construction, Grants, Lands Dedicated, Parks, and Water made transfers into the Capital Projects Fund.

The Water Fund transfers out are to the Stormwater Fund for operations, the Capital Projects Fund for a non-enterprise asset and to the Central Services Fund for energy payments and vehicle purchase. The transfers in are from the Wastewater and Parks Funds for overhead.

The Wastewater Fund transfers out are to the Water Fund for overhead and the Building Fund for energy payments and a vehicle purchase.

The Stormwater Fund transfers out are to the Wastewater Fund for overhead and the Bond Fund for payment of debt.

The Golf Course Fund transfers in are from the General Fund to meet operations and capital projects. The transfers out are to the Building Fund for energy payments.

The Internal Service Funds transfers in are for energy payments in the Building Fund and vehicle purchases. Transfers out are for capital projects.

60

CITY OF

ARVADA, COLORADO

NOTES TO FINANCIAL STATEMENTS December 31, 2013

E. Long-Term Debt Revenue Bonds Governmental Activities Series 2009 Sales and Use Tax Refunding Revenue Bonds On May 20, 2009 the City advance refunded $12,975,000 and $8,250,000 of 1998 and 1999 Sales and Use Tax Refunding Revenue Bonds, respectively, with an issuance of $19,885,000 of Sales and Use Tax Refunding Bonds dated July 1, 2009, with interest rates varying from 2.5% to 4.0% payable semi-annually on June 1 and December 1. The bonds mature beginning in 2009 and continue through 2018. The bonds were issued for the purpose of advance refunding a portion of the Cityâ&#x20AC;&#x2122;s 1998 and 1999 Sales and Use Tax Revenue Refunding Bonds in order to realize interest savings.

Bonds outstanding and related interest requirements as of December 31, 2013, are as follows (in thousands): Year Ending December 31 2014 2015 2016 2017 2018

Principal 1,935 1,990 2,045 2,105 3,885

Interest 388 340 280 219 155

Total 2,323 2,330 2,325 2,324 4,040

Total

$ 11,960

$ 1,382

$13,342

Series 2013 Sales and Use Tax Refunding Revenue Bonds On April 1, 2013, the City advance refunded $7,625,000 of the Series 2003 Sales and Use Tax Refunding Bonds by the issuance of $6,800,000 of Sales and Use Tax Refunding Revenue Bonds dated April 1, 2013 with interest rates ranging from 2.0% to 5.0% payable semi-annually on June 1 and December 1. The bonds mature beginning in 2013 and continue through 2017.

Bonds outstanding and related interest requirements as of December 31, 2013, are as follows (in thousands): Year Ending December 31 2014 2015 2016 2017 Total

Principal 1,340 1,385 1,440 1,510

Interest 243 203 148 75

Total 1,583 1,588 1,588 1,585

$5,675

$ 669

$6,344

The 2013 and 2009 Sales and Use Tax Refunding Revenue Bonds are payable solely from the Cityâ&#x20AC;&#x2122;s 3% sales tax. The sales and use tax revenues allocated for repayment of these bonds is deposited separately into the Debt Fund. During the year ended December 31, 2013, revenues of $50,023,809 were available to pay annual debt service of $3,627,292.

61

CITY OF

ARVADA, COLORADO

NOTES TO FINANCIAL STATEMENTS December 31, 2013

Business-Type Activities Series 2009 Water Enterprise Revenue Refunding Bonds On April 24, 2009 the City currently refunded $22,615,000 of 2001 Variable Rate Demand Water Enterprise Bonds, with the issuance of $21,745,000 of Water Enterprise Revenue Refunding bonds dated May 1, 2009 with interest ranging from 2.0% to 5.0% payable semiannually on May 1 and November 1. The bonds mature beginning in 2009 and continue through 2020.

Annual debt service requirements for the outstanding bond at December 31, 2013, are as follows (in thousands):

Year Ending December 31 2014 2015 2016 2017 2018 2019-2020

Principal 1,760 1,805 1,860 1,915 2,010 4,264

Interest 501 457 402 347 251 258

Total 2,261 2,262 2,262 2,262 2,261 4,522

Total

$13,614

$ 2,216

$15,830

Governmental Activities Series 2005 Certificates of Participation In July 27, 2005 the City issued Certificates of Participation in the amount of $18,505,000.

The Certificates were dated July 1, 2005, with interest rates ranging from 2.75% to 4.35% payable semi-annually. The lease payments mature beginning in 2006 and continue through 2024.

Annual lease payments and outstanding balance at December 31, 2013 are as follows (in thousands): Year Ending December 31 2014 2015 2016 2017 2018 2019-2023 2024

Principal 910 945 980 1,015 1,060 5,960 1,340

Interest 489 456 421 381 341 1,033 57

Total

$ 12,210

$ 3,178

62

Total 1,399 1,401 1,401 1,396 1,401 6,993 1,397 $ 15,388

CITY OF

ARVADA, COLORADO

NOTES TO FINANCIAL STATEMENTS December 31, 2013

Capital Lease Obligations Governmental Activities In 2010, the City entered into a lease agreement for $40,460 for a 5-year period for the purchase of a printing press. The interest rate is 7.93%. Payments of both principal and interest are due monthly.

Minimum required lease payments are as follows as of December 31, 2013 (in thousands): Year Ending December 31 2014

10

2015

10

Total

20

Less amounts representing interest

(8)

Present value of lease payments

$ 12

In 2004, the city entered into a lease agreement for $1,005,093 for a 13-year period for an energy efficiency project. The interest rate is 3.99%. Payments for both principal and interest are due monthly in 2005 and quarterly thereafter.

Minimum required lease payments are as follows as of December 31, 2013 (in thousands): Year Ending December 31 2014

115

2015

116

2016

100

Total

331

Less amounts representing interest

(19)

Present value of lease payments

$312

The total value of the governmental assets capitalized related to the capital leases net of related depreciation is $246,330.

63

CITY OF

ARVADA, COLORADO

NOTES TO FINANCIAL STATEMENTS December 31, 2013

Business-Type Activities In 2006, the City entered into a lease agreement in the amount of $1,303,000 for a 10-year period for the replacement of the Lake Arbor Golf course irrigation system. The interest rate is 5.94%. Payments of both principal and interest are due semi-annually in January and July.

Minimum required lease payments are as follows as of December 31, 2013 (in thousands): Year Ending December 31 2014

158

2015

158

2016

79

Total

395

Less amounts representing interest

(22)

Present value of lease payments

$ 373

The total value of the business-type assets capitalized related to the capital leases net of related depreciation is $944,104.

Changes in General Long-Term Liabilities â&#x20AC;&#x201C; During the year ended December 31, 2013 the following changes occurred in liabilities reported in the governmental activities (including internal service funds), business type activities, and component units (in thousands):

Governmental Activities Revenue Bonds Bond Premium Certificates of Participation Capital Lease OPEB Compensated Absences Total Governmental

Business Type Activities Revenue Bond Bond Premium Capital Lease Compensated Absences Total Business Type

$

$

$

$

Balance 01/01/2013 21,475 601 13,090 432 1,902 4,292 41,792

Balance 01/01/2013 15,345 833 513 666 17,357

Additions $

$

6,800 740 492 2,215 10,247

Reductions $

$

Additions $

404 404

$

64

10,640 221 880 108 132 2,320 14,301

Reductions $

$

1,731 104 140 378 2,353

Balance 12/31/2013 $ 17,635 1,120 12,210 324 2,262 4,187 $ 37,738

Balance 12/31/2013 $ 13,614 729 373 692 $ 15,408

Due in 1 year $

3,275 261 910 113 2,093 6,652

$

Due in 1 year $

$

1,760 104 145 345 2,354

CITY OF

ARVADA, COLORADO

NOTES TO FINANCIAL STATEMENTS December 31, 2013

4. Other Information A. Risk Management The City has established a risk management program for much of its insurance needs. It is selfinsured for occurrences of general liability and auto liability claims, which are subject to the Colorado Governmental Immunity Act which caps recoveries at $350,000 per person and $990,000 per accident. Property damage is subject to a $100,000 deductible and liability insurance a $250,000 self-insured retention (SIR). Effective April 1, 2013 the Workersâ&#x20AC;&#x2122; Compensation program maintains a self-insured retention limit of $500,000. There have been no settlements which exceed the Governmental Immunity Caps for general or auto liability in the last three years. No loss has been recorded in the last three years for the property program that exceeds the $100,000 deductible. Additionally, no claim under workersâ&#x20AC;&#x2122; compensation has been reported that exceeded the then effective SIR. Premiums are paid by each department into the Insurance Fund (internal service) to pay claims, claim reserves, loss control and administrative costs of the program including premiums to commercial insurance companies for losses in excess of the self-insured amounts.

The City also provides dental insurance for employees. Dental claims are limited to $1,500/year per person.

Liabilities are reported when it is probable that a loss has occurred and the amount of the loss can be reasonably estimated. Liabilities include an amount for claims that have been incurred but not reported. Claim liabilities are calculated considering the effects of inflation, recent claim settlement trends including frequency and amount of payouts and other economic and social factors. The liability for claims and judgments is recorded in the internal service funds.

Changes in the balances of claims liabilities during the past two years are as follows (in thousands): Insurance Service Unpaid Claims, January 1, 2012

$1,486

Incurred Claims

376

Claim Payments

926

Unpaid Claims, December 31, 2012

936

Incurred Claims

601

Claim Payments

729

Unpaid Claims, December 31, 2013

$ 808

65

CITY OF

ARVADA, COLORADO

NOTES TO FINANCIAL STATEMENTS December 31, 2013

B. Commitments and Contingencies 1) Litigation The City is involved in pending litigation. The City anticipates no potential claims resulting from these cases which would materially affect the financial statements of the City.

2) Federal Grants Federal grants are subject to audit which could result in disallowed costs, the amount which is undeterminable at December 31, 2013. If any costs are disallowed in the future, the City expects them to be insignificant.

3) AURA Commitment Developer Agreements AURA receives incremental property taxes within the Ralston Fields area, as discussed in Note 1. In addition, a public improvement corporation (PIC) collects public improvement fees (PIF) within the area in substitution of a sales tax. In 2004, AURA entered into a cooperation agreement among the following parties: • • • •

Ridge Venture LLC (the Developer), Retail Sales Operation, Kipling Ridge Metropolitan District (the District), and The City.

The purpose of this agreement is to accomplish the purposes of the Ralston Fields Urban Renewal Plan (the Plan). In this agreement, a portion of the incremental property tax revenues collected by AURA and a portion of the PIF collected by the PIC are allocated to the City, the District, and the Retail Sales Operation, as follows: • The City: AURA is to pay the City $100,000 a year for a continuing period of 18 consecutive years, which is passed through to the City of Wheat Ridge. This payment is for charges for municipal services incurred by the City of Wheat Ridge for property adjacent to the Ralston Fields Urban Renewal Area (the Area) arising from or out of the development activities that are necessary to implement the purposes of the Plan.

• The Retail Sales Operation: AURA and the PIC are to remit 25% of property taxes and PIF, derived from the Retail Sales Operation back to the Retail Sales Operation up to a maximum of $3 million. The agreement allows AURA and the PIC to pay a maximum $500,000 per year until 2014 or when the $3 million is reached, whichever is earlier (Retail Sales Operation Reimbursement Period). As of December 31, 2013, $3 million had been paid to the Retail Sales Operation.

• The District: The AURA and the PIC are to remit to the District 60% of all property tax and PIF from the Area, excluding taxes derived from the Retail Sales Operation.

Additionally, AURA is to remit to the District another 45% of all sales and property tax revenue derived from the Retail Sales Operation up to the end of the Retail Sales Operation Reimbursement Period. After the Retail Sales Operation Reimbursement Period has expired, the AURA will remit to the District 60% of all property tax and PIF from the Area, inclusive of taxes derived from the Retail Sales Operation. Upon the earlier of (a) payment in full of the District’s outstanding bonds (bonds outstanding as of December 31, 2013, or $11,935,000) or (b) September 30, 2028, AURA’s obligations to

66

CITY OF

ARVADA, COLORADO

NOTES TO FINANCIAL STATEMENTS December 31, 2013

the District will terminate. As of December 31, 2013, $2,325,929 had been paid to the district.

• Additionally, 100% of the ad valorem tax on real and personal property attributable to the District Mill Levy actually received by AURA shall be remitted to the District. Total amount remitted to the District related to the District Mill Levy during the year ended December 31, 2013 was $25,159. The District Mill Levy remitted by AURA to the District shall not be included in the totals of Property Tax payments as noted above.

On April 4, 2005, AURA also entered into a Master Redevelopment Agreement with the Jefferson Center Metropolitan District No. 1 (JCMD No. 1) and the City. This agreement, and the obligations associated with this agreement, were assigned and assumed by Jefferson Center Metropolitan District No. 2 (JCMD) effective retroactively to April 4, 2005. On January 11, 2010 this agreement was Amended and Restated. The amended and restated agreement states that JCMD will bear the costs and expenses incurred in connection with the establishment of the Jefferson Center and Northwest Arvada Urban Renewal Areas and adoption of the Jefferson Center and Northwest Arvada Urban Renewal Plans. AURA, subject to the terms and conditions set forth in the Amended and Restated Master Redevelopment Plan Agreement, is obligated to remit to JCMD and JCMD No. 1 the pledged revenues for use in financing project costs and any reimbursable expenditures in accordance with the agreement. Pledged revenues are equal to the total amount of incremental property and sales taxes received by AURA which are available for payment to JCMD and reduced by the administrative fees of $150,000. Additionally, any City Property Tax Increment collected by the county and remitted to AURA shall be utilized by AURA in furtherance of urban renewal plans.

With respect to the Jefferson Center Urban Renewal Plan, AURA’s obligations under this agreement will terminate upon the earlier of (a) the payment in full of all JCMD obligations th (bonds outstanding as of December 31, 2013, of $34,175,000), or (b) the date that is the 25 anniversary of the date of adoption of the Jefferson Center Urban Renewal Plan. With respect to the Northwest Arvada Urban Renewal Plan, AURA’s obligations under this agreement will terminate upon the earlier of (a) the date payment is made in full of all JCMD obligations (bonds outstanding as of December 31, 2013, of $34,175,000), supported by Northwest Area Property Taxes or to which Northwest Area Property Taxes are pledged, or th (b) the date that is the 25 anniversary of the date of adoption of the Jefferson Center Urban Renewal Plan. The agreement is expected to terminate in 2034.

C. Conduit Debt Obligation From time to time, the City has issued Industrial/Mortgage Revenue Bonds, Mortgage Credit Certificates and Private Activity Bonds. Industrial Bonds are issued to provide financial assistance to private-sector entities for the acquisition and construction of industrial and commercial facilities. Mortgage Bonds are issued to provide financial assistance to low and moderate income persons and families in the purchase of a home. The bonds are secured by the property financed and are payable solely from payments received on the underlying mortgage loans. Upon repayment of the bonds, ownership of such property transfers to the person/family served by the bond issuance. Neither the City, the State, nor any political subdivision thereof is obligated in any manner for repayment of the bonds. Accordingly the bonds are not reported as liabilities in the accompanying financial statements.

As of December 31, 2013, there was 1 Industrial Revenue Bond, 973 single and multi-family Mortgage Bonds, 157 Mortgage Credit Certificates and 1 Private Activity Bond. The unpaid balance on the Industrial Revenue Bond is $3.5 million and on the Mortgage Bonds is $19.3

67

CITY OF

ARVADA, COLORADO

NOTES TO FINANCIAL STATEMENTS December 31, 2013

million. The unpaid balance on the Mortgage Credit Certificates is $20.4 million and on the Private Activity Bond is $25.5 million.

D. Retirement Commitments The City has adopted separate retirement or pension plans (Plans) covering all employees, except those hired on a temporary basis.

Although it has not expressed any intention to do so, the City has the right under the Plans to discontinue its contribution or to terminate the Plans.

Should the Plans terminate at some future time, their net assets will be used to provide participants' benefits. Upon such termination, the assets of the Plans are to be allocated for the benefit of each participant and the beneficiary in a manner approved by the Internal Revenue Service.

1) Defined Benefit Police Pension Plan The City has a single employer-defined benefit plan to cover the uniformed police officers that did not elect to participate in the Defined Contribution Police Pension Plan that became effective January 1, 1986. In 1986, single premium group annuities were purchased for the benefit of retired employees, beneficiaries and terminated vested employees. After January 1, 1986, all new uniformed police officers are participants in the Defined Contribution Police Pension Plan.

One fully vested participant remains in the Defined Benefit Plan as of December 31, 2013.

The participant began receiving retirement benefits in 1997, as defined by City ordinance.

Contribution requirements of the plan were not actuarially determined and an actuary was not used to determine the actuarial implications. The City does not issue a stand-alone financial report for the plan.

The Pension Board commissioned an actuarial valuation of the plan for January 1, 2011. The valuation determined that the assets of the plan, $409,230, were not enough to cover the present value of the retirement obligation of $517,694 to the participating member at that time. The total unfunded actuarial liability was $108,464 and the funded ratio (total assets divided by total retirement obligations) was 79%.

As of December 31, 2013, the net assets held in trust were $365,090.

No contributions were made by the participant or the City for the year ended December 31, 2011. The City has budgeted $20,000 per year starting in 2012 to fund the unfunded actuarial liability. In 2012 and 2013, the City did contribute $20,000 to the plan. The annual required contribution and resulting net pension obligation were not significant.

68

CITY OF

ARVADA, COLORADO

NOTES TO FINANCIAL STATEMENTS December 31, 2013

Significant methods and assumptions included the following: • • • • • •

Actuarial Valuation Date – January 1, 2011 Actuarial Cost Method – Projected Unit Credit Amortization Method – Level Dollar Rate of Investment Return – 3.5% per annum Remaining Amortization Period – 20 years Asset Valuation Method – Market Value

2) City of Arvada Retirement Plan – Defined Contribution Plan Effective January 1, 1993, all eligible City employees participate in the City of Arvada Retirement Plan (CARP), a defined contribution plan.

All City full-time and part-time employees, except uniformed police officers, the City Manager, the City Attorney, the Municipal Judge and Department Heads are eligible to participate in CARP. 497 employees were participants in the plan as of December 31, 2013. Employer contributions vest with the employee according to the following: Years of Service Less than 1 year 1 year 2 years 3 years 4 years 5 or more years

Vesting Percentage 0% 20% 40% 60% 80% 100%

The plan requires covered employees to contribute 8% of their salary to the plan and the City to contribute 10% of the compensation of all participants hired after April 2, 2004. Employees hired on or before April 2, 2004 had a choice of receiving a flat rate 10% contribution or receiving an age weighted, graduated retirement contribution up to a maximum of 15%. The maximum permissible contribution is the lesser of $51,000 or 100% of the participant's earnings for the plan year.

Benefit payments are based upon the participant account balance as of the valuation date immediately preceding the date of distribution. The participant may elect to receive distribution in a lump sum; substantially equal annual, semi-annual, quarterly or monthly installments; through the purchase of an immediate or deferred single payment, nontransferable annuity contract; or a combination of the above. Plan provisions and contribution requirements are established and may be amended by City Council.

The required City contribution of $3,878,126 and the required employee contributions of $2,475,925 were paid during 2013. Additional employee contributions, in the form of rollovers, of $72,125 were also made in 2013. The required contributions represent 12.53% and 8% of total covered payroll, respectively. The plan investments are maintained and administered by Great-West Retirement Services.

3) Defined Contribution Police Pension Plan The City provides pension benefits for all of its uniformed officers not covered in the Defined Benefit Police Pension Plan through a defined contribution plan named the Police Money Purchase Plan (PMPP). In a defined contribution plan, benefits depend solely on amounts 69

CITY OF

ARVADA, COLORADO

NOTES TO FINANCIAL STATEMENTS December 31, 2013

contributed to the plan plus investment earnings. Participants are eligible to participate from the date of employment.

The Plan requires that the City and the participant each contribute 10% of the participant's compensation. Participants are fully vested after five years of continuous service. City contributions for, and interest forfeited by, employees who leave employment before five years of service are used to reduce the Plan's expenses. Plan provisions and contribution requirements are established and may be amended by City Council.

163 employees were participants as of December 31, 2013. The required contributions for the City and PMPP employees amounted to $1,289,144 each (10% of covered payroll).

There were forfeitures of $52,132 also contributed on the employee side, bringing the total employee contributions to $1,341,276. The plan allows voluntary and roll over contributions by employees.

The plan investments are maintained and administered by Fidelity Investments.

4) Executive Retirement Plan The City provides pension benefits for the City Manager, the City Attorney, the Municipal Judge and Department Heads through a separate defined contribution plan. The plans are administered by Great-West Retirement Services. Qualified employees are eligible to participate from the date of employment. Under the plan, the City contributes an amount equal to 10.02% of the participant's base salary. The employees covered by this plan were required to make an 8% contribution in 2013.

Employees covered under this Plan are vested upon date of hire. Employees who leave employment with the City are entitled to all contributions and interest earnings. Plan provisions and contribution requirements are established and may be amended by City Council. For the year ended December 31, 2013 the City contributed $178,662 for the benefit of the 12 participants in the Plan and the employees contributed $164,422. There were also additional voluntary employee contributions of $16,348.

E. Post-Employment Benefits Other than Pensions The City adopted the standards of Governmental Accounting Standards Board Statement No. 45, Accounting and Financial Reporting by Employers for Post-employment Benefits Other Than Pensions (GASB Statement No. 45), for the year ended December 31, 2008, on a prospective basis.

Plan Description â&#x20AC;&#x201C; The City has established a single employer-defined benefit post-employment healthcare plan. Employees with at least 20 years of service with the City, or 5 years of service with the City plus 59 years of age, are eligible to receive health insurance benefits after retirement. The retiree pays 100% of the health care premium. These benefits expire when the retiree reaches the age of 65. The authority to establish and amend benefit provisions rests with the City Council. The City does not issue a stand-alone financial report for the plan.

Funding Policy â&#x20AC;&#x201C; The contribution requirements of plan members and the City are established and may be amended by the City Council. The required contribution is based on projected payas-you-go financing requirements. For the year ended December 31, 2013, the City made $131,861 in contributions to the plan and all governmental funds with employees, General Fund, Arvada Center Fund, Parks Fund, Community Development Fund, Arvada Housing Fund and Police Tax Increment Funds, contributed to this number. Plan members are required to contribute their share of the premiums.

70

CITY OF

ARVADA, COLORADO

NOTES TO FINANCIAL STATEMENTS December 31, 2013

Annual OPEB Cost and Net OPEB Obligation – The City’s annual other post-employment benefit (OPEB) cost is calculated based on the annual required contribution of the employer (ARC), an amount actuarially determined in accordance with the parameters of GASB Statement 45. The ARC represents a level of funding that, if paid on an ongoing basis, is projected to cover normal cost each year and amortize any unfunded actuarial liabilities over a period of thirty years. The following table shows the components of the City’s annual OPEB cost for the year, the amount actually contributed to the plan, and changes in the City’s net OPEB obligation to the plan.

Annual required contribution Interest on net OPEB obligation Adjustment to annual required contribution Annual OPEB cost Contributions made Increase in net OPEB obligation Net OPEB Obligation, Beginning Net OPEB Obligation, Ending

$

486,976 71,304 (65,623) 492,657 131,861 360,796 1,901,430 $ 2,262,226

The City’s annual OPEB cost, the percentage of annual OPEB cost contributed to the plan, and the net OPEB obligation for the year ended December 31, 2013, follows.

Year Ended 12/31/11 12/31/12 12/31/13

Annual OPEB Cost $ 516,063 $ 491,591 $ 492,657

Percentage of Annual OPEB Cost Contributed 21.8 % 27.4 % 26.8 %

Net OPEB Obligation $ 1,544,744 $ 1,901,430 $2,262,226

Funded Status and Funding Progress – At January 1, 2014, the most recent actuarial valuation date, the actuarial accrued liability (AAL) was $ 5,332,419 all of which was unfunded. The covered payroll (annual payroll of active employees covered by the plan) was $ 45,053,303 million, and the ratio of the unfunded actuarial accrued liability (UAAL) to the covered payroll was 11.8%.

Actuarial valuations of an ongoing plan involve estimates of the value of reported amounts and assumptions about the probability of occurrence of events far into the future. These assumptions include among others, annual rates of payroll increases, healthcare cost trends, and mortality rates. Amounts determined regarding the funded status of the plan and the annual required contributions of the City are subject to continual revision as actual results are compared with past expectations and new estimates are made about the future. The schedule of funding progress, presented as required supplementary information following the notes to the financial statements, presents trend information about the actuarial accrued liabilities for benefits.

Actuarial Methods and Assumptions – Projections of benefits for financial reporting purposes are based on the substantive plan as understood by the City and plan members, and are based on the types of benefits provided at the time of each valuation and the historical pattern of sharing of the benefit costs between the City and plan members to that point. The actuarial methods and assumptions used include techniques that are designed to reduce the effects of short-term volatility in actuarial accrued liabilities and the actuarial value of assets, consistent with the longterm perspective of the calculations. Significant methods and assumptions included the following: • •

Actuarial Valuation Date – January 1, 2014 Actuarial Cost Method – Projected Unit Credit 71

CITY OF

ARVADA, COLORADO

NOTES TO FINANCIAL STATEMENTS December 31, 2013

• • • • • • •

Amortization Method – Level Percentage of Pay, Open Inflation Rate – 2.5% per annum Remaining Amortization Period – 30 years Assumed Salary Growth Rate – 3.5% per annum Asset Valuation Method – Fair Value Discount Rate – 3.75% per annum Healthcare Cost Trend Rate and Premium Increase – 6% for 2014, 5.7% for 2015 and grading to 4.4% over the life cycle.

F. Related Party Notes In February 2010, the City and AURA entered into a promissory note in which the City loaned AURA $2,745,000 at a simple interest rate of 3.5% for 2 years. Interest payments are due monthly. The loan is due and payable in full on April 1, 2014. The loan was collateralized with a building and two parcels of land.

In November 2013, The City and AURA entered into a promissory note in which the City loaned AURA $2,000,000 at a simple interest rate of 3.0% for 2 years. Interest payments are due monthly. The loan is due and payable in full on November 14, 2016. The loan was collateralized with a building and a parcel of land.

G. Subsequent Event In May of 2014, the City and AURA agreed to extend their intergovernmental loan agreement in the amount of $2,745,000 an additional year with a new maturity date of April 1, 2015. All of the other terms of the agreement have stayed the same.

H. GASB Statement 65 The City adopted Governmental Accounting Standards Board Statement 65 (GASB Statement 65) which establishes accounting and financial reporting standards that reclassify, as deferred outflows of resources or deferred inflows of resources, certain items that were previously reported as assets and liabilities. GASB Statement 65 also provides other financial reporting guidance related to the impact of the financial statement elements deferred outflows of resources and deferred inflows of resources, such as limiting the use of the term “deferred” in financial statement presentations. Adoption of GASB Statement 65 resulted in a decrease in net position as of January 1, 2013 of $680,000. $533,000 of this decrease was related to Governmental type activities and Business-type activities which was a decrease of $147,000 for the Water Fund.

Both of these changes resulted from the GASB Statement 65 requirement that debt issuance costs be recognized as an expense in the period incurred. Other changes include the reclassification of the following items to deferred inflows of resources: property tax and assets in the fund statements for which revenues are not available.

72

Required Supplementary Information

CITY OF

ARVADA, COLORADO

Schedule of Funding Progress Schedule of Funding Progress

Actuarial Valuation Date 01/01/2010 01/01/2012 01/01/2014

Actuarial Value of Assets $ $ $ -

Retiree Health Program Actuarial Accrued Liability (AAL)Projected Unit Credit Cost Unfunded AAL Method (UAAL) $ 5,118,413 $ 5,118,413 $ 4,989,521 $ 4,989,521 $ 5,332,419 $ 5,332,419

Funded Ratio 0% 0% 0%

Covered Payroll $ 43,239,463 $ 41,922,619 $ 45,053,303

UAAL as a Percentage of Covered Payroll 11.84% 11.90% 11.84%

Schedule of Funding Progress Police Defined Pension Program Actuarial Accrued Liability (AAL)Projected Unit Actuarial Actuarial Value Credit Cost Unfunded AAL Funded Valuation Date of Assets Method (UAAL) Ratio Covered Payroll 01/01/2011 (b) $ 409,230 $ 517,694 $ 108,464 79% N/A (b) The net pension obligation was 0 as of January 1, 2010.

73

UAAL as a Percentage of Covered Payroll N/A

CITY OF

ARVADA, COLORADO

AEDA FUND BALANCE SHEET Year Ended December 31, 2013 (in thousands)

ASSETS Cash and investments Accounts receivable (net) Accrued interest Prepaid costs Total assets

$

$

LIABILITIES AND FUND BALANCE LIABILITIES Accounts payable Unearned revenue Total liabilities

876 620 1 3 1,500

32 195 227

FUND BALANCES Nonspendable Assigned Total fund balance

3 1,270 1,273

Total liabilities and fund balances

$

74

1,500

CITY OF

ARVADA, COLORADO

AEDA FUND STATEMENT OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCE Year Ended December 31, 2013 (in thousands)

REVENUES Interest Operating grants

$

4 706

Total Revenues

710

EXPENDITURES Personnel services Services & charges Program costs Professional services Supplies

417 106 275 153 27

Total expenditures

978

NET CHANGE IN FUND BALANCES

(268)

FUND BALANCES, BEGINNING

1,541

FUND BALANCES, ENDING

$

75

1,273

CITY OF

ARVADA, COLORADO

AEDA FUND STATEMENT OF CASH FLOWS Year Ended December 31, 2013 (in thousands

Cash flows from operating activities Cash received from external customers Cash received from internal customers Cash payments to external suppliers Cash payments to internal suppliers Cash payments to employees for services Net cash used by operating activities

$

Cash flows from investing activities Interest on investments Net cash provided by investing activities

16 705 (558) (9) (415) (261) 2 2

Net decrease in cash and cash equivalents Cash and cash equivalents January 1, 2013 Cash and cash equivalents December 31, 2013 Reconciliation of operating income (loss) to net cash provided (used) by operating activities: Operating income (loss) Adjustments to reconcile operating income to net cash provided (used by operating activities: (Increase) decrease in account receivable (Increase) decrease in prepaid expenditures (Decrease) increase in accounts payable (Decrease) increase in unearned revenue (Decrease) increase in accrued payroll Net cash used by operating activities

76

$

(259) 1,135 876

(272)

$

16 5 (12) 2 (261)

Nonmajor Governmental Funds Lands Dedicated Fund Arvada Housing Authority Police Seizure Fund Police Tax Increment Funds Repayment Fund Grants Fund Bond Fund Debt Service Fund

Nonmajor Governmental Funds

CITY OF

ARVADA, COLORADO

NON-MAJOR GOVERNMENTAL FUNDS Special Revenue Funds Lands Dedicated Fund - To account for annexation requirements to be used primarily for park purposes.

Arvada Housing Authority Fund - The Section 8 Housing Assistance Payments Program is administered by the Arvada Housing Authority. The program is designed to provide rent subsidies to low or moderate income households.

Police Seizure Fund - Colorado statutes authorize local law enforcement agencies to seize cash and other assets belonging to persons convicted of public nuisance crimes. The statutes also specify that the courts may award the property to the agency that apprehended the criminal and that these resources must be used only for specific law enforcement purposes. This fund was established to account for these resources as they are awarded to and expended by the City's law enforcement agency.

Police Tax Increment Funds - The purpose of the tax increment funds is to account for the voter approved sales tax increases to fund expanded police services.

Grants Fund - To account for receipt of lottery monies through the Conservation Trust Fund. Also to account for the disbursement of monies through transfers to other funds for specific uses as dictated by the Conservation Trust Fund.

Debt Service Funds Bond Fund â&#x20AC;&#x201C; To account for transfers from the General Fund and Stormwater Fund for payments of principal and interest on the $18,505,000 Series 2005 COP Bonds.

Debt Service Fund â&#x20AC;&#x201C; To account for the payment of revenue debt incurred through bond issues other than Water Bond Issues, which are accounted for in the Water Fund. Payments for the Limited Sales and Use Tax Revenue Bonds and Highway Users Tax Fund Bonds are included in this fund.

77

CITY OF

ARVADA, COLORADO

NON-MAJOR GOVERNMENTAL FUNDS COMBINING BALANCE SHEET December 31, 2013 (in thousands)

Special Revenue Funds Arvada Housing Authority Police Seizure Fund Fund

Lands Dedicated Fund ASSETS Cash and investments Accounts receivable (net) Accrued interest Prepaid costs Total assets

Police Tax Increment (.21) Fund

Police Tax Increment (.25) Fund

$

2,333 4 -

$

214 67 -

$

263 1 -

$

3,555 442 8 19

$

4,547 471 9 -

$

2,337

$

281

$

264

$

4,024

$

5,027

LIABILITIES AND FUND BALANCE LIABILITIES Accounts payable Due to other funds Unearned revenue

-

24 23 39

-

513 36

517

Total liabilities

-

86

-

549

523

2,337 2,337

195 195

264 264

19 3,456 3,475

4,504 4,504

FUND BALANCES Nonspendable Restricted Committed Assigned Unassigned Total fund balance Total liabilities and fund balances

$

2,337

$

78

281

$

264

$

4,024

6

$

5,027

CITY OF

ARVADA, COLORADO

Debt Service

Grants Fund

Debt Service Fund

Bond Fund

Total Non-major Governmental

$

1,237 6 -

$

126 -

$

326 -

$

12,601 980 28 19

$

1,243

$

126

$

326

$

13,628

$

-

-

-

1,054 23 81

-

-

-

1,158

1,243 1,243

126 126

326 326

19 12,451 12,470

1,243

$

126

$

79

326

$

13,628

CITY OF

ARVADA, COLORADO

NON-MAJOR GOVERNMENTAL FUNDS COMBINING STATEMENT OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCES Year Ended December 31, 2013 (in thousands)

Special Revenue Funds Arvada Housing Authority Police Seizure Fund Fund

Lands Dedicated Fund REVENUES Taxes Intergovernmental Dedications Investment earnings (loss) Miscellaneous

$

Total Revenues

201 (7) -

3,602 1 21

$

(1) 5

$

3,513 130 (6) 68

194

3,624

4

3,705

-

3,784

11

3,374

-

-

-

3,182

-

3,784

11

6,556

(160)

(7)

(2,851)

EXPENDITURES Program costs Debt Service Principal Interest Captal outlay Total expenditures EXCESS (DEFICIENCY) OF REVENUES OVER EXPENDITURES

$

Police Tax Increment (.21) Fund

194

OTHER FINANCING SOURCES (USES) Bond proceeds Bond refinancing Transfers in Transfers out

-

150 -

-

-

Total other financing sources (uses)

-

150

-

-

(10)

(7)

NET CHANGE IN FUND BALANCES

194

FUND BALANCES, BEGINNING FUND BALANCES, ENDING

2,143 $

2,337

80

205 $

195

(2,851) 6,326

271 $

264

$

3,475

CITY OF

ARVADA, COLORADO

Debt Service Police Tax Increment (.25) Fund

$

Grants Fund

4,321 (9) -

$

$

3 -

Debt Service Fund

$

3,879 10 -

Total Non-major Governmental

$

11,713 4,319 201 (20) 94

4,312

576

3

3,889

16,307

3,483

-

1

1

10,654

2,896

-

880 520 -

3,015 689 -

3,895 1,209 6,078

6,379

-

1,401

3,705

21,836

(2,067)

$

587 (11) -

Bond Fund

576

(1,398)

184

(5,529)

-

(2,237)

1,399 -

7,527 (7,721) -

7,527 (7,721) 1,549 (2,237)

-

(2,237)

1,399

(194)

(882)

(2,067)

(1,661)

1

(10)

(6,411)

6,571

2,904

336

18,881

4,504

$

1,243

125 $

126

81

$

326

$

12,470

CITY OF

ARVADA, COLORADO

LANDS DEDICATED FUND SCHEDULE OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCE BUDGET AND ACTUAL Year Ended December 31, 2013 (in thousands)

Actual

Variance With Final Budget Positive

Amounts

(Negative)

Budgeted Amounts Original REVENUES Dedications Investment earnings (loss )

$

Total revenues OTHER FINANCING SOURCES (USES) Transfers out

NET CHANGE IN FUND BALANCE

$

$

75 60

135

135

(200)

(65) 2,195

FUND BALANCE, BEGINNING FUND BALANCE, ENDING

75 60

Final

2,130

82

$

$

126 (67)

194

59

(200)

-

200

(65)

194

259

2,143

-

2,143 $

201 (7)

2,078

$

2,337

$

259

CITY OF

ARVADA, COLORADO

ARVADA HOUSING AUTHORITY SCHEDULE OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCE BUDGET AND ACTUAL Year Ended December 31, 2013 (in thousands)

Actual

Variance With Final Budget Positive

Amounts

(Negative)

Budgeted Amounts Original REVENUES Intergovernmental Federal grants Investment earnings Miscellaneous

$

Total revenues EXPENDITURES Current expenditures: Personnel services Services and charges Supplies Rents Total expenditures EXCESS (DEFICIENCY) OF REVENUES OVER EXPENDITURES OTHER FINANCING USES Transfers in Total other financing uses NET CHANGE IN FUND BALANCE FUND BALANCE, BEGINNING FUND BALANCE, ENDING

$

Final

3,900 6 19

$

3,900 6 19

$

3,602 1 21

$

(298) (5) 2

3,925

3,925

3,624

(301)

317 79 23 3,532

317 104 24 3,506

360 104 12 3,308

(43) 12 198

3,951

3,951

3,784

167

(26)

(26)

(160)

(134)

26

26

150

124

26

26

150

124

-

-

(10)

(10)

325

205

325

83

$

205

205 $

195

$

(10)

CITY OF

ARVADA, COLORADO

POLICE SEIZURE FUND SCHEDULE OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCE BUDGET AND ACTUAL Year Ended December 31, 2013 (in thousands)

Actual

Variance With Final Budget Positive

Amounts

(Negative)

Budgeted Amounts Original REVENUES Seizure & forfeitures Investment earnings (loss) Miscellaneous

$

Total revenues EXPENDITURES NET CHANGE IN FUND BALANCE FUND BALANCE, BEGINNING FUND BALANCE, ENDING

$

25 4

Final

$

25 4

$

(1) 5

$

(25) (5) 5

29

29

4

(25)

25

25

11

14

4

4

(7)

(11)

255

271

259

84

$

275

271 $

264

$

(11)

CITY OF

ARVADA, COLORADO

POLICE TAX INCREMENT (.21) FUND SCHEDULE OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCE BUDGET AND ACTUAL Year Ended December 31, 2013 (in thousands)

Actual

Variance With Final Budget Positive

Amounts

(Negative)

Budgeted Amounts Original REVENUES Sales and use taxes Intergovernmental Federal grants Investment earnings (loss) Miscellaneous

$

Total revenues EXPENDITURES Current expenditures: Personnel services Services and charges Supplies Total current expenditures Capital outlay Total Expenditures NET CHANGE IN FUND BALANCE FUND BALANCE, BEGINNING FUND BALANCE, ENDING

$

3,260

Final

$

3,420

$

3,513

$

22 -

96 22 40

3,282

3,578

3,705

127

2,674 243 464

2,674 326 464

2,666 251 457

8 75 7

3,381

3,464

3,374

90

4,003

4,253

3,182

1,071

7,384

7,717

6,556

1,161

(4,102)

(4,139)

(2,851)

1,288

6,134

6,326

6,326

2,032

85

$

2,187

130 (6) 68

93

$

3,475

34 (28) 28

$

1,288

CITY OF

ARVADA, COLORADO

POLICE TAX INCREMENT (.25) FUND SCHEDULE OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCE BUDGET AND ACTUAL Year Ended December 31, 2013 (in thousands)

Actual

Variance With Final Budget Positive

Amounts

(Negative)

Budgeted Amounts Original REVENUES Sales and use taxes Investment earnings (loss)

$

Total Revenues EXPENDITURES Current expenditures: Personnel services Services and charges Supplies Total current expenditures Capital outlay Total Expenditures EXCESS (DEFICIENCY) OF REVENUES OVER EXPENDITURES OTHER FINANCING USES Transfers out NET CHANGE IN FUND BALANCE FUND BALANCE, BEGINNING FUND BALANCE, ENDING

$

Final

4,022 30

$

4,201 30

$

4,321 (9)

$

120 (39)

4,052

4,231

4,312

81

3,314 142 194

3,314 142 194

3,089 203 191

225 (61) 3

3,650

3,650

3,483

167

4,001

4,500

2,896

1,604

7,651

8,150

6,379

1,771

(3,599)

(3,919)

(2,067)

(1,852)

(35)

(35)

(3,634)

(3,954)

(2,067)

6,486

6,571

6,571

2,852

86

$

2,617

-

$

4,504

35 1,887 $

1,887

CITY OF

ARVADA, COLORADO

GRANTS FUND SCHEDULE OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCE BUDGET AND ACTUAL Year Ended December 31, 2013 (in thousands)

Actual

Variance With Final Budget Positive

Amounts

(Negative)

$

$

Budgeted Amounts Original REVENUES Intergovernmental revenues State grants Investment earnings (loss) Total revenues

$

536 50

Final

$

536 50

587 (11)

51 (61)

586

586

576

EXPENDITURES Current expenditures: Capital outlay

-

-

-

-

Total Expenditures

-

-

-

-

OTHER FINANCING USES Transfers out Total other financing uses NET CHANGE IN FUND BALANCE FUND BALANCE, BEGINNING FUND BALANCE, ENDING

(10)

(600)

(2,237)

(2,237)

-

(600)

(2,237)

(2,237)

-

(14)

(1,651)

(1,661)

2,904

2,904

2,925 $ 2,911

87

$

1,253

$

1,243

(10) $

(10)

CITY OF

ARVADA, COLORADO

BOND FUND SCHEDULE OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCE BUDGET AND ACTUAL Year Ended December 31, 2013 (in thousands)

Actual

Variance With Final Budget Positive

Amounts

(Negative)

Budgeted Amounts Original REVENUES Investment earnings

$

-

Final

$

-

$

3

$

3

EXPENDITURES Debt Service Principal Investment earnings Professional services

845 554 10

845 554 10

880 520 1

Total expenditures

1,409

1,409

1,401

8

(1,409)

(1,409)

(1,398)

11

1,399

1,399

1,399

-

1,399

1,399

1,399

-

1

11

125

-

EXCESS (DEFICIENCY) OF REVENUES OVER EXPENDITURES OTHER FINANCING USES Transfers in Total other financing uses NET CHANGE IN FUND BALANCE

(10)

(10)

FUND BALANCE, BEGINNING

110

125

FUND BALANCE, ENDING

$

100

88

$

115

$

126

(35) 34 9

$

11

CITY OF

ARVADA, COLORADO

DEBT SERVICE FUND SCHEDULE OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCE BUDGET AND ACTUAL Year Ended December 31, 2013 (in thousands)

Actual

Variance With Final Budget Positive

Amounts

(Negative)

$

$

Budgeted Amounts Original REVENUES Sales and use taxes Investment earnings

$

Total revenues

4,034 5

Final

$

4,034 5

3,879 10

(155) 5

4,039

4,039

3,889

(150)

EXPENDITURES Services and charges Principal Interest

5 3,310 724

5 3,310 801

1 3,015 689

4 295 112

Total expenditures

4,039

4,116

3,705

411

184

261

EXCESS (DEFICIENCY) OF REVENUES OVER EXPENDITURES

-

(77)

OTHER FINANCING USES Bond proceeds Bond refinancing Total other financing uses

-

7,527 (7,721) (194)

7,527 (7,721) (194)

-

NET CHANGE IN FUND BALANCE

-

(271)

(10)

261

336

336

336

FUND BALANCE, BEGINNING FUND BALANCE, ENDING

$

336

89

$

65

$

326

$

261

CITY OF

ARVADA, COLORADO

This Page Intentionally Left Blank

90

Enterprise Funds

Enterprise Funds Water Fund Stormwater Fund Wastewater Fund Food Services Fund Golf Fund

CITY OF

ARVADA, COLORADO ENTERPRISE FUNDS

Water Fund - This fund accounts for all activity within the scope of water utility operations. Water service is available to all areas within the City limits and is extended to some residents of the county and adjacent cities. All activities necessary to provide such service are accounted for in this fund, including administration, operations, capital water projects, maintenance, financing and related debt service, and billing and collection.

Wastewater Fund - This fund accounts for all activities necessary in the collection, transmission, and disposal of sewage and wastewater. It includes administration, operations, capital maintenance, financing and billing and collection.

Stormwater Fund - This fund accounts for all activities necessary to maintain a stormwater management plan. It includes administration, operations, capital maintenance and billing and collection.

Food Services Fund - This fund accounts for all revenues 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.

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

It includes administrative, operations, maintenance, financing and related debt service at Lake Arbor and West Woods Golf Courses. Food service activities include restaurant operations at the West Woods and Lake Arbor Golf Courses.

91

CITY OF

ARVADA, COLORADO

WATER FUND BUDGETARY COMPARISON SCHEDULE Year Ended December 31, 2013 (in thousands)

Budgeted Amounts

Actual

Variance With Final Budget Positive (Negative)

Original

Final

Amounts

$ 19,149 28 92 1,191 23 3,205 429

$ 19,149 28 92 1,191 4,023 3,205

$ 17,841

24,117

28,117

34,601

6,484

Operating and maintenance Administration

15,686 629

15,747 729

15,326 724

421 5

Capital outlay Principal expense Interest expense Transfers out

42,336 1,730 535 242

47,234 1,730 535 242

9,725 1,730 530 334

37,509 5 (92)

61,158

66,217

28,369

37,848

REVENUES Sales Licenses/permits and fees Service charges and fees Investment earnings (loss) Miscellaneous revenues Water/tap Developer contributions Transfers in Total revenues

429

$

569 (1) 4,225 7,897 3,643 427

(1,308) (28) 477 (1,192) 202 4,692 3,643 (2)

EXPENDITURES

Total expenditures CHANGE IN NET POSITION

$ (37,041)

ADJUSTMENTS TO GAAP BASIS Principal Capital outlay Net book value of assets retired Depreciation and amortization

$ (38,100)

6,232

1,730 9,725 (302) (3,592)

CHANGE IN NET POSITION, GAAP BASIS

$ 13,793

92

$

44,332

CITY OF

ARVADA, COLORADO

WASTEWATER FUND BUDGETARY COMPARISON SCHEDULE Year Ended December 31, 2013 (in thousands)

Actual

Variance With Final Budget Positive

Final

Amounts

(Negative)

31 11,726 566

$

$

Budgeted Amounts Original REVENUES Licenses/permits and fees Service charges and fees Investment earnings (loss) Other revenues Sewer/tap Developer contributions Transfers in

$

Total revenues EXPENDITURES Operating and maintenance Administration Capital outlay Transfers out Total expenditures

CHANGE IN NET POSITION

31 11,726 566

69

849 1,744 -

(31) (547) (605) 614 1,744 (69)

12,627

12,627

13,733

1,106

11,144 708 186 280

11,810 708 320 280

9,047 665 2,092 303

2,763 43 (1,772) (23)

12,318

13,118

12,107

1,011

$

$

235 69

235

309

$

(491)

11,179 (39)

1,626

ADJUSTMENTS TO GAAP BASIS Capital outlay Net book value of assets retired Depreciation

2,092 (664) (1,153)

CHANGE IN NET POSITION, GAAP BASIS

$

93

1,901

$

2,117

CITY OF

ARVADA, COLORADO

STORMWATER FUND BUDGETARY COMPARISON SCHEDULE Year Ended December 31, 2013 (in thousands)

Actual

Variance With Final Budget Positive

Amounts

(Negative)

Budgeted Amounts Original REVENUES Service charges and fees Grants Investment earnings (loss) Developer contributions Transfer in Total revenues EXPENDITURES Operating and maintenance Capital outlay Transfers out Total expenditures

CHANGE IN NET POSITION

$

3,157 10 56 -

Final

$

3,157 10 56 -

$

3,254 (13) 3,500 -

$

97 (10) (69) 3,500 -

3,223

3,223

6,741

3,518

1,883 3,928 933

1,883 8,839 933

1,021 3,212 2,405

862 5,627 (1,472)

6,744

11,655

6,638

5,017

$ (3,521)

$ (8,432)

103

ADJUSTMENTS TO GAAP BASIS Capital outlay Net book value of assets retired Depreciation

3,212 (108) (681)

CHANGE IN NET POSITION, GAAP BASIS

$

94

2,526

$

8,535

CITY OF

ARVADA, COLORADO

FOOD SERVICES FUND BUDGETARY COMPARISON SCHEDULE Year Ended December 31, 2013 (in thousands)

Actual

Variance With Final Budget Positive

Amounts

(Negative)

Budgeted Amounts Original

REVENUES Sales Investment earnings (loss)

$

Total revenues EXPENDITURES Operating and maintenance Administration Capital outlay Total expenditures CHANGE IN NET POSITION

$

1,667 6

Final

$

1,526 6

$

1,352 (1)

$

(174) (7)

1,673

1,532

1,351

(181)

1,571 26 263

1,571 26 263

1,440 26 5

131 258

1,860

1,860

1,471

389

(187)

$

(328)

(120)

ADJUSTMENTS TO GAAP BASIS Capital outlay

5

Depreciation

(49)

CHANGE IN NET POSITION, GAAP BASIS

$

95

(164)

$

208

CITY OF

ARVADA, COLORADO

GOLF COURSE FUND BUDGETARY COMPARISON SCHEDULE Year Ended December 31, 2013 (in thousands)

Actual

Variance With Final Budget Positive

Amounts

(Negative)

$

$

Budgeted Amounts Original REVENUES Sales Service charges and fees Investment earnings (loss) Other revenue Transfers in

$

Total revenues EXPENDITURES Operating and maintenance Principal expense Interest expense Capital outlay Transfers out Total expenditures CHANGE IN NET POSITION

1,378 2,745 12 201

Final

$

1,378 2,745 12 201

1,490 2,418 (2) 13 201

112 (327) (2) 1 -

4,336

4,336

4,120

(216)

3,884 270 33 100 4

3,912 270 33 397 4

4,107 140 16 385 4

(195) 130 17 12 -

4,291

4,616

4,652

(36)

$

45

$

(280)

(532)

ADJUSTMENTS TO GAAP BASIS Principal Capital outlay Depreciation

140 385 (118)

CHANGE IN NET POSITION, GAAP BASIS

$

96

(125)

$

(252)

Insurance Service Fund Computer Fund Print Shop Fund Vehicle Fund Building Fund

Internal Service Funds

Internal Service Funds

CITY OF

ARVADA, COLORADO

INTERNAL SERVICE FUNDS

Insurance Service Fund - This fund accounts for the activities associated with the City’s worker’s compensation, unemployment and property and liability insurance activities. Premiums are paid by each department into this fund to pay claims, claim reserves and administrative costs of the program including premiums to commercial insurance companies for losses in excess of the self insured amounts.

Computer Fund - This fund accounts for the accumulation of financial resources necessary for the timely and orderly replacement and maintenance of the City’s computer equipment and software.

Print Shop Fund - This fund accounts for the accumulation of financial resources necessary for the operation of the City’s print shop, copier maintenance and replacement.

Vehicle Fund – This fund accounts for the accumulation of financial resources necessary for the timely and orderly replacement and maintenance of the City’s vehicles and equipment.

Building Fund – This fund accounts for the accumulation of financial resources used for non-routine building maintenance.

97

CITY OF

ARVADA, COLORADO

INTERNAL SERVICE FUNDS COMBINING STATEMENT OF NET POSITION December 31, 2013 (in thousands)

Insurance Service Fund

Computer Fund

$

$

Print Shop Fund

Vehicle Fund

Total Internal Service Funds

Building Fund

ASSETS CURRENT ASSETS Cash and investments Accounts receivable (net) Accrued interest Inventories Prepaid costs Total current assets

5,414 2 11 89

6,015 14 166

$

146 4 2

$

6,280 3 11 264 25

$

2,128 4 -

$

19,983 5 40 268 282

5,516

6,195

152

6,583

2,132

20,578

178

19

31

5,743

440

6,411

5,694

6,214

183

12,326

2,572

26,989

104 808 6 -

203 -

10 9

153 40 -

1 104

471 808 46 113

918

203

19

193

105

1,438

5 -

-

3

40 -

208

45 211

5

-

3

40

208

256

923

203

22

233

313

1,694

178 4,593

19 5,992

19 142

5,743 6,350

128 2,131

6,087 19,208

NONCURRENT ASSETS Property and equipment, net of accumulated depreciation Total assets

LIABILITIES CURRENT LIABILITIES Accounts payable Claims payable Accrued compensated absences Capital lease Total current liabilities

NONCURRENT LIABILITIES Accrued compensated absences Capital lease Total non-current liabilities Total liabilities

NET POSITION Net investment in capital assets Unrestricted Total net position

$

4,771

$

6,011

98

$

161

$

12,093

$

2,259

$

25,295

CITY OF

ARVADA, COLORADO

INTERNAL SERVICE FUNDS COMBINING STATEMENT OF REVENUES, EXPENSES AND CHANGES IN FUND NET POSITION Year Ended December 31, 2013 (in thousands)

Insurance Service Fund

Print Shop Fund

Computer Fund

Vehicle Fund

Total Internal Service Funds

Building Fund

REVENUES Service charges

$

Recovered costs Miscellaneous Total revenues

2,010 112 -

$

1,780 93 28

$

307 1 -

$

3,313 33

$

407 -

$

7,817 239 28

2,122

1,901

308

3,346

407

8,084

Administration

604

120

296

1,726

-

2,746

Insurance premiums/ prescriptions

634 601 11

2,217 10

3

590 1,238

98 259

634 601 2,905 1,521

1,850

2,347

299

3,554

357

8,407

EXPENSES

Uninsured damages and claims Repair and maintenance Depreciation Total expenses Operating income

272

(446)

9

(208)

50

(323)

(17) -

(21) -

(1)

42 (16) -

(6) (15)

42 (60) (16)

Total non-operating revenues (expenses)

(17)

(21)

(1)

26

(21)

(34)

INCOME BEFORE TRANSFERS

255

(467)

8

(182)

29

(357)

NON-OPERATING REVENUES (EXPENSES) Gain on sale of assets Investment earnings (loss) Interest expense

TRANSFERS IN TRANSFERS OUT

(574)

(1,500)

-

71 -

237 -

308 (2,074)

CHANGE IN NET POSITION

(319)

(1,967)

8

(111)

266

(2,123)

153

12,204

1,993

$

27,418

2,259

$

25,295

NET POSITION, BEGINNING NET POSITION, ENDING

5,090 $

4,771

7,978 $

6,011

99

$

161

$

12,093

$

CITY OF

ARVADA, COLORADO

INTERNAL SERVICE FUNDS COMBINING STATEMENT OF CASH FLOWS Year Ended December 31, 2013 (in thousands)

Cash Flows From Operating Activities Cash received from external customers Cash received from internal customers Cash payments to external suppliers Cash payments to internal suppliers Cash payments to employees for services Net cash provided (used) by operating activities Cash Flows From Noncapital Financing Activities Transfers to other funds Transfer from other funds Net cash provided (used) by noncapital financing activities

Insurance Service Fund

Computer Fund

Print Shop Fund

Vehicle Fund

Building Fund

Total Internal Service

$

$

$

$

$

$

66 2,010 (1,399) (7) (553) 117

(574) (574)

121 1,780 (1,995) (73) (120) (287)

(1,500) (1,500)

1 307 (126) (173) 9

-

33 3,312 (909) (241) (1,237) 958

71 71

407 (98) 309

221 7,816 (4,527) (321) (2,083) 1,106

237 237

(2,074) 308 (1,766)

(99) (20) (119)

(1,622) (108) (20) 126 (1,624)

Cash Flows From Capital and Related Financing Activities Purchases of capital assets Payment of capital lease Interest expense Proceeds from sale of assets Net cash provided (used) by capital and related financing activities

(83) (83)

Cash Flows From Investing Activities Investment earnings (loss) Net cash provided (used) by investing activities

(16) (16)

(19) (19)

-

(13) (13)

-

(48) (48)

(556)

(1,806)

-

(397)

427

(2,332)

Net increase (decrease) in cash and cash equivalents

-

(9) (9)

(1,539) 126 (1,413)

Cash and cash equivalents January 1, 2013

5,970

7,821

146

6,677

1,701

22,315

Cash and cash equivalents December 31, 2013

5,414

6,015

146

6,280

2,128

19,983

Reconciliation of operating income to net cash provided (used) by operating activities : Operating income Adjustments to reconcile operating income to net cash provided by operating activities : Depreciation expense (Increase) decrease in account receivable (Increase) decrease in inventories (Increase) decrease in deferred interest (Increase) decrease in prepaid expenditures (Increase) decrease in deferred charges (Decrease) increase in accounts payable (Decrease) increase in accrued interest payable (Decrease) increase in contracts payable (Decrease) increase in claims payable (Decrease) increase in bonds payable (Decrease) increase in due to other funds (Decrease) increase in deferred revenue (Decrease) increase in accrued benefits Net cash provided (used) by operating activities

272

(446)

9

(208)

50

(323)

(44) 7 (128) 1

10 38 111 -

3 (3) -

1,238 (1) (16) (15) (44) 4

259 -

1,521 (3) (16) (21) 71 (128) 5

117

(287)

9

958

309

1,106

11 (2)

100

CITY OF

ARVADA, COLORADO

INSURANCE SERVICE FUND BUDGETARY COMPARISON SCHEDULE Year Ended December 31, 2013 (in thousands)

REVENUES Service charges Recovered costs Investment earnings (loss) Total revenues EXPENDITURES Administration Insurance premiums Uninsured damages and claims Capital outlay Tansfer out Total expenditures CHANGE IN NET POSITION

Budgeted Amounts Original Final

Actual

Variance With Final Budget Positive

Amounts

(Negative)

$

$

$

2,011 68

$

2,011 68

2,010 112 (17)

2,079

2,079

2,105

623 1,185 781 574

631 1,212 781 69 574

604 634 601 83 574

3,163

3,267

2,496

$ (1,084)

$ (1,188)

(391)

ADJUSTMENTS TO GAAP BASIS Capital outlay Depreciation

83 (11)

$

CHANGE IN NET POSITION, GAAP BASIS

101

(319)

(1) 112 (85) 26

27 578 180 (14) 771 $

797

CITY OF

ARVADA, COLORADO

COMPUTER FUND BUDGETARY COMPARISON SCHEDULE Year Ended December 31, 2013 (in thousands)

REVENUES Service charges Recovered costs Miscellaneous Costs Investment earnings (loss) Total revenues

Budgeted Amounts Original Final

Actual

Variance With Final Budget Positive

Amounts

(Negative)

$

$

EXPENDITURES Administration Repair and maintenance Transfers out Total expenditures CHANGE IN NET POSITION

$

1,780 50 26 1,856

$

1,780 50 26 1,856

1,780 93 28 (21) 1,880

$

43 2 (21) 24

101 2,021 -

101 3,159 1,500

120 2,217 1,500

(19) 942 -

2,122

4,760

3,837

923

(266)

$ (2,904)

(1,957)

ADJUSTMENTS TO GAAP BASIS Depreciation

(10)

CHANGE IN NET POSITION, GAAP BASIS

$ (1,967)

102

$

947

CITY OF

ARVADA, COLORADO

PRINT SHOP FUND BUDGETARY COMPARISON SCHEDULE Year Ended December 31, 2013 (in thousands)

REVENUES Service charges Recovered costs Investment earnings Total revenues

Budgeted Amounts Original Final

Actual

Variance With Final Budget Positive

Amounts

(Negative)

$

$

EXPENDITURES Administration Repair and maintenance Principal Interest Total expenditures CHANGE IN NET POSITION

438 438

$

391 13 404 $

34

$

438 438

307 1 308

382 13 8 1 404

296 8 1 305

34

3

ADJUSTMENTS TO GAAP BASIS Principal Depreciation

8 (3)

CHANGE IN NET POSITION, GAAP BASIS

$

103

8

$

(131) 1 (130)

86 13 99 $

(31)

CITY OF

ARVADA, COLORADO

VEHICLE FUND BUDGETARY COMPARISON SCHEDULE Year Ended December 31, 2013 (in thousands)

REVENUES Service charges Recovered costs Investment earnings (loss) Transfer in Gain (loss) on sale of assets Total revenues EXPENDITURES Administration Repair and maintenance Capital outlay Total expenditures

CHANGE IN NET POSITION

Budgeted Amounts Original Final

Actual

Variance With Final Budget Positive

Amounts

(Negative)

$

$

3,292 61 75

$

3,292 61 75

3,313 33 (16) 71 42

$

21 33 (77) 71 (33)

3,428

3,428

3,443

15

1,769 2,032 1,592

1,769 2,032 1,592

1,726 590 1,539

43 1,442 53

5,393

5,393

3,855

1,538

$ (1,965)

$ (1,965)

(412)

ADJUSTMENTS TO GAAP BASIS Capital outlay Depreciation

1,539 (1,238)

CHANGE IN NET POSITION, GAAP BASIS

$

104

(111)

$

1,553

CITY OF

ARVADA, COLORADO

BUILDING FUND BUDGETARY COMPARISON SCHEDULE Year Ended December 31, 2013 (in thousands)

REVENUES Service charges Investment earnings (loss) Transfers in

Budgeted Amounts Original Final

Actual

Variance With Final Budget Positive

Amounts

(Negative)

$

$

$

Total revenues EXPENDITURES Repair and maintenance Capital outaly Principal Interest Transfer out Total expenditures

CHANGE IN NET POSITION

$

407 15 116

$

407 15 116

407 (6) 237

(21) 121

538

538

638

100

61 99 15 -

215 99 15 -

98 99 15 -

117 -

175

329

212

117

209

426

363

$

ADJUSTMENTS TO GAAP BASIS Capital outlay Principal Depreciation

99 (259)

CHANGE IN NET POSITION, GAAP BASIS

$

105

266

$

217

CITY OF

ARVADA, COLORADO

This Page Intentionally Left Blank

106

Fiduciary Fund

CITY OF

ARVADA, COLORADO

AGENCY FUND STATEMENT OF CHANGES IN ASSETS AND LIABILITIES Year Ended December 31, 2013 (in thousands)

Balance January 1, 2013

Additions

Deductions

$

$

$

1,620 10 511 2,141

$

$

4,560 9 2,003 6,572

$ $

6,572 6,572

$ $

2,283 2,283

Balance December 31, 2013

ESCROW FUND ASSETS Cash and investments Accrued Interest Accounts receivable Total assets LIABILITIES Escrow funds Total liabilities

107

$

$

627 9 2,514 3,150

$

5,553 10 5,563

$ $

3,292 3,292

$ $

5,563 5,563

CITY OF

ARVADA, COLORADO

This Page Intentionally Left Blank

108

Local Highway Finance Report

CITY OF

ARVADA, COLORADO Financial Planning 02/01 Form # 350-050-36

The public report burden for this information collection is estimated to average 380 hours annually.

City or County: LOCAL HIGHWAY FINANCE REPORT This Information From The Records Of (example - City of _ or County of _)Prepared By: City of Arvada Phone:

City

YEAR ENDING : December 2013 Kimberly Martin 720-898-7136

I. DISPOSITION OF HIGHWAY-USER REVENUES AVAILABLE FOR LOCAL GOVERNMENT EXPENDITURE A. Local Motor-Fuel Taxes

ITEM 1.

2.

3.

4.

5.

B. Local Motor-Vehicle Taxes

C. Receipts from State HighwayUser Taxes

D. Receipts from Federal Highway Administration

Total receipts available Minus amount used for collection expenses Minus amount used for nonhighway purposes Minus amount used for mass transit Remainder used for highway purposes II. RECEIPTS FOR ROAD AND STREET PURPOSES

ITEM A. Receipts from local sources: 1. Local highway-user taxes a. Motor Fuel (from Item I.A.5.) b. Motor Vehicle (from Item I.B.5.) c. Total (a.+b.)

2. General fund appropriations 3. Other local imposts (from page 2) 4. Miscellaneous local receipts (from page 2) 5. Transfers from toll facilities 6. Proceeds of sale of bonds and notes: a. Bonds - Original Issues b. Bonds - Refunding Issues c. Notes d. Total (a. + b. + c.)

7. Total (1 through 6) B. Private Contributions C. Receipts from State government (from page 2) D. Receipts from Federal Government (from page 2) E. Total receipts (A.7 + B + C + D)

AMOUNT

28,760,733 1,068,843 0

0 29,829,576 4,255,546 699,257 34,784,379

III. DISBURSEMENTS FOR ROAD AND STREET PURPOSES ITEM AMOUNT A. Local highway disbursements: 1. Capital outlay (from page 2) 15,972,088 2. Maintenance: 4,374,313 3. Road and street services: a. Traffic control operations 3,466,162 b. Snow and ice removal c. Other d. Total (a. through c.)

3,466,162 4. General administration & miscellaneous 782,709 5. Highway law enforcement and safety 10,189,107 6. Total (1 through 5) 34,784,379 B. Debt service on local obligations: 1. Bonds: a. Interest b. Redemption c. Total (a. + b.)

0 2. Notes: a. Interest b. Redemption c. Total (a. + b.)

0 3. Total (1.c + 2.c) 0 C. Payments to State for highways D. Payments to toll facilities E. Total disbursements (A.6 + B.3 + C + D) 34,784,379

IV. LOCAL HIGHWAY DEBT STATUS (Show all entries at par) Opening Debt Amount Issued

Redemptions

Closing Debt

A. Bonds (Total) 1. Bonds (Refunding Portion) B. Notes (Total)

0 0 V. LOCAL ROAD AND STREET FUND BALANCE

A. Beginning Balance

B. Total Receipts C. Total Disbursements 34,784,379 34,784,379

D. Ending Balance

E. Reconciliation 0

Notes and Comments:

FORM FHWA-536 (Rev. 1-05)

PREVIOUS EDITIONS OBSOLETE

109

(Next Page)

CITY OF

ARVADA, COLORADO STATE: Colorado YEAR ENDING (mm/yy): December 2013

LOCAL HIGHWAY FINANCE REPORT

II. RECEIPTS FOR ROAD AND STREET PURPOSES - DETAIL ITEM A.3. Other local imposts: a. Property Taxes and Assessments b. Other local imposts: 1. Sales Taxes 2. Infrastructure & Impact Fees 3. Liens 4. Licenses 5. Specific Ownership &/or Other 6. Total (1. through 5.) c. Total (a. + b.)

AMOUNT

718,844

349,999 1,068,843 1,068,843

ITEM A.4. Miscellaneous local receipts: a. Interest on investments b. Traffic Fines & Penalities c. Parking Garage Fees d. Parking Meter Fees e. Sale of Surplus Property f. Charges for Services g. Other Misc. Receipts h. Other i. Total (a. through h.)

AMOUNT

0

(Carry forward to page 1)

ITEM C. Receipts from State Government 1. Highway-user taxes 2. State general funds 3. Other State funds: a. State bond proceeds b. Project Match c. Motor Vehicle Registrations d. Other (Specify) e. Other (Specify) f. Total (a. through e.)

4. Total (1. + 2. + 3.f)

AMOUNT 3,847,443

408,103 408,103 4,255,546

(Carry forward to page 1)

ITEM D. Receipts from Federal Government 1. FHWA (from Item I.D.5.)

2. Other Federal agencies: a. Forest Service b. FEMA c. HUD d. Federal Transit Admin e. U.S. Corps of Engineers f. Other Federal g. Total (a. through f.)

3. Total (1. + 2.g)

AMOUNT

699,257 (Carry forward to page 1)

III. DISBURSEMENTS FOR ROAD AND STREET PURPOSES - DETAIL ON NATIONAL HIGHWAY SYSTEM (a) A.1. Capital outlay: a. Right-Of-Way Costs b. Engineering Costs c. Construction: (1). New Facilities (2). Capacity Improvements (3). System Preservation (4). System Enhancement & Operation (5). Total Construction (1) + (2) + (3) + (4) d. Total Capital Outlay (Lines 1.a. + 1.b. + 1.c.5)

OFF NATIONAL HIGHWAY SYSTEM (b)

887,351

6,638,173

262,098

2,744,216 4,932,734 507,516 8,184,466 14,822,639

262,098 1,149,449

TOTAL (c) 7,525,524 0 0 3,006,314 4,932,734 507,516 8,446,564 15,972,088 (Carry forward to page 1)

Notes and Comments:

FORM FHWA-536 (Rev.1-05)

PREVIOUS EDITIONS OBSOLETE

110

Statistical Section Statistical Section

CITY OF

ARVADA, COLORADO

Statistical Section This part of the City of Arvada's Comprehensive Annual Financial Report represents detailed information as a context for understanding what the information in the financial statements, note disclosures, and required supplemental information says about the City's overall financial health.

Contents

Page

Financial Trends These schedules contain trend information to help the reader understand how the City's financial performance and well-being have changed over time.

Net Position by Component Changes in Net Position (expenses) Changes in Net Position (revenues) Fund Balances, Governmental Funds Changes in Fund Balances, Governmental Funds Revenue Capacity These schedules contain information to help the reader assess the factors affecting the City's ability to generate its property and sales taxes.

Direct and Overlapping Sales Tax Rates Sales and Use Tax Revenue Principal Property Tax Payers Property Tax Levies and Collections Assessed & Actual Values of Taxable Property Debt Capacity These schedules present information to help the reader assess the affordability of the City's current levels of outstanding debt and the City's ability to issue additional debt in the future.

Ratios of Outstanding Debt by Type Ratios of General Bonded Debt Outstanding Direct and Overlapping Governmental Activities Debt Legal Debt Margin Information Pledged-Revenue Coverage Schedule of Debt Service Requirements - Governmental Activities Schedule of Debt Service Requirements - Business-Type Activities Demographic and Economic Information These schedules offer demographic and economic indicators to help the reader understand the environment wherein the City's financial activites take place and to help make comparisons over time and with other governments.

Demographic and Economic Statistics Principal Employers Operating Information These schedules contain information about the City's operations and resources to help the reader understand how the City's financial information relates to the service the City provides and the activities it performs.

Full-time Equivalent City Government Employees by Function/Program Operating Indicators by Function/Program Capital Asset Statistics by Function/Program Sources: Unless otherwise noted, the information in these schedules is derived from the Comprehensive Annual Financial Reports for the relevant year. The City implemented GASB Statement 34 in 2003; schedules presenting government-wide information include information beginning in that year.

111

112 113 114 115 116

117 118-119 120-121 122 123

124 125 126 127 128 129 130

131 132-133

134 135 136

CITY OF

ARVADA, COLORADO

City of Arvada Net Position by Component Last Ten Fiscal Years (accrual basis of accounting) (in thousands)

Fiscal Year 2004 Governmental Activities Net investment in capital assets Restricted Unrestricted Total governmental activities net position Business-type Activities Net investment in capital assets Restricted Unrestricted Total business-type activities net position Primary Government Net investment in capital assets Restricted Unrestricted Total primary government net position

$

$

$

$

$

$

2005

199,026 16,626 76,450 292,102

$

136,294 71,309 207,603

$

335,320 16,626 147,759 499,705

$

$

$

$

2006

201,623 37,925 49,722 289,270

$

146,968 71,037 218,005

$

348,591 37,925 120,759 507,275

$

$

$

$

2007

213,611 29,974 52,701 296,286

$

160,118 83,312 243,430

$

373,729 29,974 136,013 539,716

$

$

$

$

2008

223,565 15,735 74,472 313,772

$

174,370 100 89,078 263,548

$

397,935 15,835 163,550 577,320

$

Source: City of Arvada, Finance Department Note: Government-wide financial statements have been prepared in accordance with the requirements of GASB 34.

112

$

$

$

2009

2010

2011

2012

2013

233,223 17,425 80,607 331,255

$ 218,883 18,174 98,412 $ 335,469

$ 222,197 20,306 100,289 $ 342,792

$ 234,874 25,837 95,365 $ 356,076

$ 252,120 22,517 90,637 $ 365,274

$ 262,131 19,018 92,089 $ 373,238

186,979 100 92,657 279,736

$ 194,128 89,902 $ 284,030

$ 198,953 1,865 85,899 $ 286,717

$ 206,768 1,866 85,717 $ 294,351

$ 219,419 1,706 91,198 $ 312,323

$ 238,881 1,536 89,643 $ 330,060

420,202 17,801 172,988 610,991

$ 413,011 18,174 188,554 $ 619,739

$ 421,150 22,171 186,188 $ 629,509

$ 441,642 27,703 181,082 $ 650,427

$ 471,539 24,223 181,835 $ 677,597

$ 501,012 20,554 181,732 $ 703,298

CITY OF

ARVADA, COLORADO

City of Arvada Changes in Net Position Last Ten Fiscal Years (accrual basis of accounting) (in thousands)

Functions/Program Activities Expenses Governmental activities: General Government Public safety Public works Parks and recreation Culture Human Services Interest Total governmental activities expenses Business-type activities: Water Wastewater Other Total business-type activities expenses Total primary government expenses Program Revenues Governmental activities: Charges for services: General Government Public works Parks & Recreation Other activities Operating grants and contributions Capital grants and contributions Total governmental activities program revenues Business-type activities: Charges for services: Water Wastewater Other Operating grants and contributions Capital grants and contributions Total business-type activities program revenues Total primary government program revenues

2004

2005

Fiscal Year 2006

2007

2008

$ 17,569 19,047 13,858 5,506 8,242 5,528 2,157

$ 33,914 19,380 14,007 5,865 9,170 5,051 2,084

$ 22,946 21,278 14,843 6,231 9,352 4,170 2,469

$ 26,142 22,054 17,357 6,598 9,155 4,081 2,361

$ 27,821 22,922 16,352 6,861 10,041 4,355 2,245

71,907

89,471

81,289

87,748

13,962 6,816 6,860

15,524 7,007 6,421

16,288 6,931 6,982

27,638

28,952

$ 99,545

2010

2011

2012

2013

14,267 23,544 16,967 14,273 10,649 4,251 2,329

$ 15,586 22,999 17,102 14,382 10,000 4,734 1,579

$ 14,280 23,989 25,631 7,121 10,613 4,420 1,501

$ 16,245 25,987 26,644 7,329 10,809 4,580 1,443

$ 22,193 26,578 28,117 7,428 10,797 4,558 1,119

90,597

86,280

86,382

87,555

93,037

100,790

17,137 7,633 6,894

18,807 9,359 7,079

19,386 8,770 7,035

19,169 9,341 6,764

19,544 9,883 7,016

19,634 10,553 7,302

20,609 11,536 7,575

30,201

31,664

35,245

35,191

35,274

36,443

37,489

39,720

$ 118,423

$ 111,490

$ 119,412

$ 125,842

$ 121,471

$ 121,656

$ 123,998

$ 130,526

$ 140,510

6,077 2,603 736 3,975 9,517 8,171

10,268 2,473 770 4,136 10,019 7,347

9,535 1,926 762 5,269 9,301 4,596

10,193 2,006 866 8,864 9,265 6,960

11,212 1,892 885 6,979 9,008 12,432

5,267 3,008 1,020 6,959 9,501 2,789

5,130 1,578 2,603 5,819 11,789 3,020

5,333 2,038 1,799 6,720 9,218 6,470

5,159 2,623 961 6,737 9,171 12,431

5,726 2,870 902 4,831 11,681 6,706

31,079

35,013

31,389

38,154

42,408

28,544

29,939

31,578

37,082

32,716

12,751 5,339 8,927 8,619

13,502 5,979 8,072 7,602

16,525 6,921 8,359 10,658

15,881 7,692 9,167 10,563

19,285 8,484 8,857 10,706

14,972 9,753 8,661 1,581

17,170 9,904 8,519 64 2,584

18,221 10,336 8,497 200 6,519

21,026 10,704 9,544 12,240

22,635 11,179 8,527 17,633

35,636

35,155

42,463

43,303

47,332

34,967

38,241

43,773

53,514

59,974

$ 66,715

$ 70,168

$ 73,852

$ 81,457

$ 89,740

63,511

$ 68,180

$ 75,351

$ 90,596

$ 92,690

113

2009

$

$

CITY OF

ARVADA, COLORADO

City of Arvada Changes in Net Position Last Ten Fiscal Years (modified accrual basis of accounting) (in thousands)

Functions/Program Activities Net (Expense)/Revenue Governmental activities Business-type activities Total primary government net expense

2004 (40,828) 7,998 ($32,830)

2005

Fiscal Year 2006

(54,458) 6,203 ($48,255)

General Revenues and Other Changes In Net Position Governmental activities: Taxes Property taxes $ 4,412 $ 4,404 Franchise taxes 3,490 Sales taxes 34,956 34,674 Transportation taxes 4,481 4,295 Investment earnings 4,141 4,746 Miscellaneous 643 5,258 Transfers (2,766) (1,751) Total governmental activities 49,357 51,626 Business-type activites Investment earnings 854 1,653 Miscellaneous 180 795 Transfers 2,766 1,751

2007

(49,900) 12,262 ($37,638)

$

4,534 42,426 4,692 6,509 1,449 (2,694) 56,916

2008

(49,594) 11,639 ($37,955)

$

4,785 50,051 4,668 5,529 4,871 (2,824) 67,080

(48,189) 12,087 ($36,102)

$

5,099 50,322 4,533 4,707 1,122 (111) 65,672

3,279 7,190 2,694

5,244 411 2,824

3,832 158 111

Total business-type activities Total primary government

3,800 $ 53,157

4,199 $ 55,825

13,163 $ 70,079

8,479 $ 75,559

4,101 $ 69,773

Change in Net Position Governmental activities Business-type activities Total primary government

8,529 11,798 $ 20,327

(2,832) 10,402 $ 7,570

7,016 25,425 $ 32,441

17,486 20,118 $ 37,604

17,483 16,188 $ 33,671

Source: City of Arvada, Finance Department Note: General Government represents support and administrative divisions such as Legal, Finance, City Manager's Office, KATV, Human Resources, Planning, Code Enforcement, Information Services, Courts, and City Council.

114

2009

2010

(57,736) (224) ($57,960)

$

5,121 49,530 4,665 1,875 462 882 62,535

2011

(56,443) 2,967 ($53,476)

$

4,961 50,259 4,761 1,206 1,198 1,381 63,766

(55,977) 7,330 ($48,647)

$

2012

2013

(55,955) 16,025 ($39,930)

(68,074) 20,254 ($47,820)

4,953 $ 4,829 50,996 54,298 4,648 4,787 1,602 571 471 1,947 931 (1,279) 63,601 65,153

$ 4,907 58,519 4,646 107 5,974 2,418 76,571

1,361 1,319 (882)

894 207 (1,381)

1,148 87 (931)

582 86 1,279

-56 104 (2,418)

$

1,798 64,333

(280) $ 63,486

304 $ 63,905

1,947 $ 67,100

(2,370) $ 74,201

$

4,799 1,574 6,373

7,323 2,687 $ 10,010

7,624 7,634 $ 15,258

9,198 17,972 $ 27,170

8,497 17,884 $ 26,381

CITY OF

ARVADA, COLORADO

City of Arvada Fund Balances â&#x20AC;&#x201C; Governmental Funds Last Ten Fiscal Years (modified accrual basis of accounting) (in thousands)

2004 General Fund Reserve Unreserved Nonspendable Restricted Committed Assigned Unassigned Total general fund All Other Governmental Funds Reserve Unreserved Special revenue funds Debt Service Capital project funds Nonspendable Restricted Committed Assigned Unassigned Subtotal All Other Governmental Funds Total Governmental Funds Reserve Unreserved Nonspendable Restricted Committed Assigned Unassigned

Total all other governmental funds

$

2,209 33,084 35,293

2005 $

2,506 27,132 29,638

Fiscal Year 2006 $

2,336 28,696 31,032

2007 $

2,623 25,981 28,604

2008 $

2009

2,484 27,325 29,809

$ 2,521 30,218 32,739

2010 $

2,406 18,652 21,058

2011 $

2012

607 1,780 2,731 17,947 23,065

$

2013

603 1,891 985 19,486 22,965

$

640 2,028

23,007 25,675

4,876

8,669

10,986

13,382

15,048

16,530

17,855

-

-

-

13,809

11,509

11,827

17,127 -

24,196 -

14,163 -

14,605 637 16,566 -

16,254 745 18,077 -

14,862 343 34,275 -

14,831 377 48,810 -

301 24,098 24,279 30,354 -

255 20,654 17,768 33,378 -

231 16,120 14,953 38,314 -

35,812

44,374

36,976

45,190

50,124

66,010

81,873

79,032

72,055

69,618

7,085 64,020 -

11,175 62,837 -

13,322 54,686 -

16,005 57,789 -

17,690 62,243 -

18,842 79,907 -

21,033 82,670 -

908 25,878 24,279 33,085 17,947

858 22,545 17,768 34,363 19,486

871 18,148 14,953 38,314 23,007

$ 71,105

$ 74,012

$ 68,008

$ 73,794

$ 79,933

$ 98,749

$ 103,703

$ 102,097

$ 95,020

$ 95,293

Source: City of Arvada Finance Department Note: In Fiscal Year ending December 31, 2011, the City of Arvada Government Accounting Standard Board Statement number 54. The presentation of the different Fund Balance types are listed above with figures recorded in the applicable categories. A brief definition of these categories are defined on page 48 of the Notes to the Financial Statements section of the CAFR.

115

CITY OF

ARVADA, COLORADO

City of Arvada Changes in Fund Balances-Governmental Funds Last Ten Fiscal Years (modified accrual basis of accounting) (in thousands)

Fiscal Year 2006 2007

2004

2005

2008

2009

2010

2011

2012

2013

Taxes Licenses and Permits Intergovernmental Charges for Services Fines and Forfeits Interest Memberships and Donations Miscellaneous

$ 42,858 2,776 16,953 9,902 1,102 3,927 457 1,860

$ 42,856 2,686 14,826 10,750 1,129 4,313 422 1,150

$ 50,917 2,275 14,773 10,611 1,152 5,520 419 1,747

$ 58,839 2,294 14,975 13,203 1,225 4,228 317 4,173

$ 59,773 2,219 13,577 13,867 1,378 3,674 299 894

$ 58,710 3,450 15,291 8,324 1,633 1,431 332 664

$ 59,547 3,014 16,440 9,563 1,558 986 290 924

$ 60,232 2,396 15,166 8,116 1,261 1,231 1,577 839

$ 63,274 2,873 15,441 5,628 1,681 425 427 2,418

$ 67,846 3,275 15,668 5,537 1,710 167 725 5,507

Total revenues

$ 79,835

$ 78,132

$ 87,414

$ 99,254

$ 95,681

$ 89,835

$ 92,322

$ 90,818

$ 92,167

$ 100,435

General Government Public Safety Public Works Program Costs Capital Outlay Debt Service Principal Interest

$ 14,103 15,924 14,025 19,441 11,253

$ 19,024 16,030 13,891 21,988 24,110

$ 14,878 17,523 15,025 23,039 16,324

$ 17,466 17,628 17,792 23,888 8,702

$ 18,747 23,866 16,651 20,621 4,411

$ 12,167 24,094 17,128 20,981 5,946

$ 13,697 23,873 17,286 21,219 9,917

$ 11,080 23,555 18,188 21,300 14,551

$ 12,779 25,518 19,266 21,870 12,986

$ 13,640 26,382 20,498 22,060 16,468

1,250 2,157

1,840 2,084

3,230 2,469

3,345 2,361

3,460 2,245

3,011 1,469

4,079 1,667

4,073 1,515

4,045 1,388

3,895

Total Expenditures

$ 78,153

$ 98,967

$ 92,488

$ 91,182

$ 90,001

$ 84,796

$ 91,738

$ 94,262

$ 97,852

1209 $ 104,152

1,682

(20,835)

(5,074)

8,072

5,680

5,039

584

(3,444)

(5,685)

(3,717)

9,853 (12,613)

18,505 4,752 16,322 (15,837)

724 21,851 (23,505)

724 16,562 (19,572)

725 11,091 (11,357)

(192) 20,857 (21,952) 15,774 (12,884)

30,777 (26,407)

14,955 (14,136)

19,350 (20,742)

20,110 (15,926)

(2,760)

23,742

(930)

(2,286)

459

1,603

4,370

819

(1,392)

3,990

2,907

$ (6,004)

6,139

$ 6,642

$ 4,954

$ (2,625)

$ (7,077)

7%

6%

Revenues:

Expenditures:

Excess (Deficiency) of Revenues Over (Under) Expenditures Other Financing Sources (Uses) Bond Issuance costs Proceeds from borrowing Payments to escrow agent Sale of Assets Transfers in Transfers out Total Other Financing Sources (Uses) Net Change in Fund Balances

$ (1,078)

Debt service as a % of Noncapital Expenditures

5%

$

6%

8%

$

5,786

7%

Source: City of Arvada, Finance Department

116

$

7%

6%

-

8%

-

7,527 (7,721)

$

273

4%

CITY OF

ARVADA, COLORADO

City of Arvada Direct and Overlapping Sales Tax Rates Last Ten Fiscal Years

City Direct Rates

Fiscal Year 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013

Basic Rate 3.21% 3.21% 3.46% 3.46% 3.46% 3.46% 3.46% 3.46% 3.46% 3.46%

State of Colorado

Jefferson County

2.90% 2.90% 2.90% 2.90% 2.90% 2.90% 2.90% 2.90% 2.90% 2.90%

0.50% 0.50% 0.50% 0.50% 0.50% 0.50% 0.50% 0.50% 0.50% 0.50%

Overlapping Rates Rapid Transit Adams District County RTD 0.70% 0.70% 0.75% 0.75% 0.75% 0.75% 0.75% 0.75% 0.75% 0.75%

0.60% 1.00% 1.00% 1.00% 1.00% 1.00% 1.00% 1.00% 1.00% 1.00%

Cultural Facilities District 0.10% 0.10% 0.10% 0.10% 0.10% 0.10% 0.10% 0.10% 0.10% 0.10%

Baseball Football Stadium District 0.10% 0.10% 0.10% 0.10% 0.10% 0.10% 0.10% 0.10% 0.00% 0.00%

Source: City of Arvada, Finance Department The combined direct and overlapping rates for Jefferson and Adams counties are 7.96% and 8.21%, respectively. The Baseball/Football stadium taxes expired Jan 1, 2012.

117

ARVADA, COLORADO

CITY OF

City of Arvada Sales and Use Tax Last Ten Fiscal Years

2004 Sales Tax: Grocery Chain Stores Fast Food Restaurants General Dept Stores Public Utilities Restaurant & Lounges Telephone Equipment & Service Misc. - Other Total Sales Tax

$

5,877,084 1,455,665 6,707,313 3,376,846 1,909,988 1,507,751 14,408,246

2005 $

5,986,055 1,516,717 6,618,964 3,632,166 1,916,329 1,280,206 14,705,419

2006 $

6,529,755 1,719,437 7,146,661 4,030,217 2,096,434 1,282,742 16,573,910

2007 $

7,017,236 1,707,247 7,312,606 4,074,050 2,227,360 1,382,418 17,006,837

2008 $

7,288,486 1,810,008 7,288,906 4,317,928 2,255,327 1,480,300 17,064,447

35,242,893

35,655,856

39,379,156

40,727,754

41,505,402

60,570 24,316 15,796 167,922 49,418 7,257 863,177

61,453 39,050 91,822 145,881 55,256 9,455 922,461

110,181 32,056 56,729 154,510 62,426 4,088 1,188,404

24,091 22,567 36,522 231,681 45,754 3,556 942,161

27,114 27,749 69,290 225,767 50,506 3,203 1,199,747

Total Use Tax

1,188,456

1,325,378

1,608,394

1,306,332

1,603,376

Auto Use

5,568,113

5,230,665

4,978,494

5,444,119

4,957,715

Building Use

3,060,688

2,582,355

2,404,810

1,930,349

1,772,748

$ 45,060,150

$ 44,794,254

$ 48,370,854

$ 49,408,554

$ 49,839,241

Use Tax: Grocery Chain Stores Fast Food Restaurants General Dept Stores Public Utilities Restaurant & Lounges Telephone Equipment & Service Misc. - Other

Total City Direct Sales Tax Rate

3.21%

3.21%

3.46%

3.46%

3.46%

Source: City of Arvada, Finance Department

Note: In 2013 total sales taxes generated in the City continued the trend that has occurred for the last three years and increased over the previous year’s sales taxes. The Grocery Stores category, our largest individual category in terms of sales taxes generated, showed a healthy 8.4% increase in 2013. This increase was led by the continued success of the remodeled grocery store at 80th and Wadsworth. The Miscellaneous category showed a 7.5% increase over 2012. Furniture Store sales, which are included in the Miscellaneous category, showed the largest gains with a 7.5% increase. Total use tax, which is comprised of General, Building, and Automotive use taxes, showed a substantial increase, 17.93% in 2013. Spurred by the increased activity in the housing market, building use tax has continued to increase over the last three years showing a 25.9% increase in 2013.

118

CITY OF

ARVADA, COLORADO City of Arvada Sales and Use Tax Last Ten Fiscal Years

2009 $

2010

2011

2012

2013

7,321,094 1,802,468 7,325,139 3,947,475 2,223,585 1,476,853 16,152,264

$ 7,207,867 2,055,222 7,273,593 3,250,660 2,327,476 1,590,756 16,720,308

$ 7,319,409 2,167,255 7,492,172 3,155,985 2,368,744 1,576,849 17,159,077

$ 8,231,101 2,342,211 7,817,740 3,079,318 2,550,369 1,592,914 17,920,002

$ 8,835,763 2,505,503 7,849,715 3,270,129 2,648,445 1,513,155 19,264,163

40,248,879

40,425,882

41,239,491

43,533,655

45,886,873

68,055 15,459 48,512 589,297 29,931 4,545 1,196,560

56,962 29,626 50,083 1,141,121 23,865 4,545 1,050,757

145,708 45,810 28,893 425,956 45,491 1,670 1,135,344

92,328 33,141 21,726 313,319 32,201 3,238 957,004

83,558 52,869 35,809 385,520 37,678 1,819 1,125,684

1,952,358

2,356,959

1,828,872

1,452,957

1,722,937

4,534,445

4,593,311

5,006,383

5,539,267

6,205,601

2,382,088

2,078,930

2,070,334

2,773,894

3,341,299

$49,117,770

$49,455,082

$50,145,080

$53,299,773

$57,156,710

3.46%

3.46%

3.46%

3.46%

3.46%

119

CITY OF

ARVADA, COLORADO

City of Arvada, Colorado Principal Property Tax Payers Current Year and Nine Years Ago (in thousands)

2004

2005

Percentage of Total City Taxable Taxable Assessed Assessed Value Rank Value

2006

Percentage of Total City Taxable Taxable Assessed Assessed Value Rank Value

2007

Percentage of Total City Taxable Taxable Assessed Assessed Value Rank Value

2008

Percentage of Total City Taxable Taxable Assessed Assessed Value Rank Value

Percentage of Total City Taxable Taxable Assessed Assessed Value Rank Value

Tax Remitter ADLP 80th LLC Arvada Market Place East Arvada Structures LLC Arvada West 04, LLC Chou Jack C Co Trustee Cobe Laboratories Comcast of Colorado Costco Wholesale Corp.

Cub Square Centre LLC GP Retail I LLC Indian Tree LLC Inland Western Arvada LLC Xcel Energy Primestar Solar Quest Plains End LLC R&M Western Partnership Sundyne Corp.

Target Corp TVO Southwestern Partners Total

0

3,463 8,105 3,691 3,597 3,636

9 5 6 8 7

2,741 9,273 16,194 13,533 10,549 -

10 4 1 2 3 -

-

-

$ 74,782

0.35% 0.83% 0.38% 0.37% 0.37%

4,346 4,661 8,437 3,573 5,036

8 7 5 9 6

0.42% 0.45% 0.82% 0.35% 0.49%

3,878 4,661 7,969 3,534 3,611 5,036

8 7 5 10 9 6

0.37% 0.45% 0.76% 0.34% 0.35% 0.48%

4,090 4,477 3,889 4,792

9 7 10 5

0.36% 0.40% 0.35% 0.43%

4,090 4,477 4,596 4,792

10 7 6 5

0.36% 0.39% 0.40% 0.42%

0.28% 0.95% 1.66% 0.00% 1.38% 1.08% -

2,842 12,489 13,639 14,242 9,933 -

10 3 2 1 4 -

0.28% 1.21% 1.33% 0.00% 1.38% 0.97% -

12,489 12,601 16,601 9,416 -

3 2 1 4 -

1.19% 1.21% 0.00% 1.59% 0.90% -

11,456 12,504 15,610 12,420 4,281 4,521

4 2 1 3 8 6

1.02% 1.11% 0.00% 1.39% 1.10% 0.38% 0.40%

11,456 13,275 15,238 12,447 4,238 4,390

4 2 1 3 9 8

1.01% 1.17% 0.00% 1.34% 1.09% 0.37% 0.39%

-

-

-

-

-

-

-

-

-

-

-

-

7.65%

$ 79,198

7.70%

$ 79,796

7.63%

$ 78,040

6.93%

$ 78,999

Source: Jefferson and Adams County Assessors Offices Note: The top ten taxpayers represents roughly 7% of the total assessed valuation for the City of Arvada.

The remaining 93% represents smaller business and residential customers

120

6.95%

CITY OF

ARVADA, COLORADO

City of Arvada, Colorado Principal Property Tax Payers Current Year and Nine Years Ago (in thousands)

2009

2010 Percentage of Total City Taxable Assessed Value

Taxable Assessed Value

Percentage of Total City Taxable Assessed Value

Taxable Assessed Value

Rank

3,657 4,297 3,805 4,594

10 7 9 5

0.32% 0.38% 0.34% 0.00% 0.41%

4,110 3,704 3,486 4,199

7 9 10 6

0.37% 0.33% 0.31% 0.37%

3,609 3,420 3,364

9,478 34,352 9,321 12,036 4,531 4,019

3 1 4 2 6 8

0.84% 3.05% 0.00% 0.83% 1.07% 0.40% 0.36%

9,615 28,337 14,170 12,310 4,309 3,891

4 1 2 3 5 8

0.86% 2.53% 0.00% 1.26% 1.10% 0.38% 0.35%

-

-

-

-

-

-

Rank

Taxable Assessed Value

2011

2012

Percentage of Total City Taxable Assessed Rank Value

Percentage of Total City Taxable Assessed Rank Value

Taxable Assessed Value

2013

Taxable Assessed Value

Rank

Percentage of Total City Taxable Assessed Value

Tax Remitter ADLP 80th LLC Arvada Market Place East Arvada Structures LLC Arvada West 04, LLC Chou Jack C Co Trustee Cobe Laboratories Comcast of Colorado Costco Wholesale Corp.

Cub Square Centre LLC GP Retail I LLC Indian Tree LLC Inland Western Arvada LLC Xcel Energy Primestar Solar Quest Plains End LLC R&M Western Partnership Sundyne Corp.

Target Corp TVO Southwestern Partners Total

0

$ 90,090

7.99%

$

88,131

7.85%

$

0.32% 0.30% 0.00% 0.39%

3,621 3,707 3,420

9 8 10

0.32% 0.33% 0.30%

3,495

9

0.31%

3,420

10

0.30%

4,372

8 9 10 5

4,373

7

0.39%

4,290

7

0.38%

6,979 18,915 15,902 12,290 4,160 3,839

4 1 2 3 6 7

0.62% 1.69% 0.00% 1.42% 1.10% 0.37% 0.34%

9,133 16,722 8,063 18,772 9,951 4,749 -

4 2 5 1 3 6 -

0.81% 1.49% 0.72% 1.67% 0.89% 0.42% 0.00%

8,905 21,848 4,810 9,911 17,140

4 1 5 3 2

0.79% 1.95% 0.43% 0.88% 1.53% 0.39% 0.32%

-

-

-

-

-

4,364 3,584 -

6 8

76,850

121

6.54%

$

82,511

7.35%

$

81,767

7.29%

CITY OF

ARVADA, COLORADO

City of Arvada Property Tax Levies and Collections Last Ten Years (modified accrual basis of accounting)

Fiscal Year Ended 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013

Taxes Levied for the Fiscal Year (1) 3,963,606 3,996,218 4,169,012 4,422,851 4,757,970 4,803,790 4,668,390 4,677,597 4,548,234 4,585,586

Collection within the Fiscal Year of the Levy Percentage Amount of Levy 3,992,477 3,993,781 4,135,847 4,383,304 4,718,720 4,770,519 4,637,622 4,643,015 4,500,376 4,556,940

100.73% 99.94% 99.20% 99.11% 99.18% 99.31% 99.34% 99.26% 98.95% 99.38%

Source: Jefferson and Adams County Assessors Offices Note: Excludes Specific Ownership Tax (1) Taxes levied is for the tax year preceding the fiscal year.

The mill levy rate for 2013 is 4.31.

122

Collections in Subsequent Years 0.00 0.00 0.00 3,853 2,080 1,795 1,108 1,750 3,307 8,650

Total Collections to Date Percentage Amount of Levy 3,992,477 3,993,781 4,135,847 4,387,157 4,720,800 4,772,315 4,638,730 4,644,765 4,503,683 4,565,590

100.73% 99.94% 99.20% 99.19% 99.22% 99.34% 99.36% 99.30% 99.02% 99.56%

CITY OF

ARVADA, COLORADO

City of Arvada Assessed Value and Actual Value of Taxable Property Last Ten Years (in thousands)

Vacant property Residential property Commercial property Industrial property Agricultural property Natural Resources State assessed property Personal property Total taxable assessed value

$ $ $ $ $ $ $ $ $

2004 24,582,300 678,489,350 169,543,790 59,461,020 1,532,080 320 45,218,320 2,563,490 981,390,670

2005 $ 26,517,270 $ 689,194,530 $ 203,122,180 $ 62,613,590 $ 1,568,160 $ 320 $ 42,921,340 $ 2,762,230 $ 1,028,699,620

2006 $ 20,196,350 $ 703,037,820 $ 212,625,220 $ 60,758,960 $ 1,554,330 $ 320 $ 44,143,550 $ 2,900,950 $ 1,045,217,500

2007 $ 28,559,660 $ 752,547,870 $ 225,401,350 $ 68,972,520 $ 1,516,050 $ 320 $ 45,809,460 $ 3,269,500 $ 1,126,076,730

2008 $ 27,772,060 $ 759,627,790 $ 230,096,840 $ 68,876,220 $ 1,492,280 $ 420 $ 46,001,680 $ 3,298,970 $ 1,137,166,260

4.31

4.31

4.31

4.31

4.31

Total direct tax rate Estimated actual taxable value

$

9,576,687 $

9,828,930 $

9,886,572 $

10.2%

10.5%

10.6%

10.6%

10.5%

2009 $ 22,225,900 $ 728,285,380 $ 240,075,860 $ 70,564,000 $ 1,952,380 $ 420 $ 61,326,920 $ 3,054,470 $ 1,127,485,330

2010 $ 20,415,720 $ 729,786,750 $ 235,714,770 $ 70,224,120 $ 1,917,540 $ 420 $ 60,603,390 $ 3,416,840 $ 1,122,079,550

2011 $ 20,501,926 $ 717,675,555 $ 219,477,899 $ 67,948,483 $ 2,076,911 $ 415 $ 53,119,623 $ 3,245,250 $ 1,084,046,062

2012 $ 20,001,930 $ 723,906,993 $ 225,781,990 $ 67,051,461 $ 2,062,898 $ 415 $ 52,323,639 $ 3,101,790 $ 1,094,231,116

2013 $ 23,271,345 $ 744,813,813 $ 222,389,232 $ 65,196,131 $ 1,944,906 $ 467 $ 55,792,241 $ 3,080,440 $ 1,116,488,575

4.31

4.31

4.31

4.31

4.31

Assessed value as a percentage of estimated actual value

Vacant property Residential property Commercial property Industrial property Agricultural property Natural Resources State assessed property Personal property Total taxable assessed value Total direct tax rate Estimated actual taxable value

$

Assessed value as a percentage of estimated actual value

10,359,457 $

10,359,672 $

10.9%

10.8%

Source: Jefferson and Adams County Assessors' offices.

123

10,157,393 $ 10.7%

10,577,558 $

10,236,790 $ 10.7%

10,844,919

10,493,112 10.6%

CITY OF

ARVADA, COLORADO

City of Arvada Ratios of Outstanding Debt by Type Last Ten Fiscal Years (in thousands)

Governmental Activities Sales General Tax Certificates Capital of Fiscal Obligation Increment Year Bonds Bonds Lease Participation 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013

-

43,770 41,930 39,405 36,790 34,080 30,770 28,580 25,378 22,076 18,755

1,010 977 909 846 768 1,121 783 534 432 324

18,505 17,800 17,070 16,320 15,550 14,755 13,935 13,090 12,210

Business-Type Activities

Water Bonds 27,940 26,690 25,390 24,030 22,615 20,205 19,696 17,962 16,178 14,343

Source: City of Arvada Finance Department

124

Capital Leases

Total Primary Government

Percentage of Personal Income

2,006 1,698 2,617 2,465 2,009 1,093 875 647 513 373

74,726 89,800 86,121 81,201 75,792 68,739 64,689 58,456 52,289 46,005

3.45% 3.11% 3.67% 2.51% 2.55% 1.95% 2.01% 1.76% 1.59% 1.36%

Per Capita 0.72 0.87 0.84 0.77 0.71 0.64 0.60 0.55 0.49 0.42

CITY OF

ARVADA, COLORADO

City of Arvada Ratios of General Bonded Debt Outstanding and Legal Debt Margin Last Ten Fiscal Years (modified accrual basis of accounting)

General Bonded Debt Outstanding

Fiscal Year 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013

General Obligation Bonds

Redevelopment Bonds $0 $0 $0 $0 $0 $0 $0 $0 $0 $0

Percentage of Actual Taxable Value of Property

Total

$0 $0 $0 $0 $0 $0 $0 $0 $0 $0

$0 $0 $0 $0 $0 $0 $0 $0 $0 $0

0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00%

Source: City of Arvada Comprehensive Annual Financial Report (2003-2013), Jefferson and Adams County Assessors Offices, Denver Regional Council of Governments

125

Per Capita

$0.00 $0.00 $0.00 $0.00 $0.00 $0.00 $0.00 $0.00 $0.00 $0.00

CITY OF

ARVADA, COLORADO

City of Arvada Direct and Overlapping Governmental Activities Debt Last Fiscal Year

Debt Outstanding

Jurisdiction Direct City of Arvada

Overlapping Jefferson County School District R-1 Adams County School District (50) APEX (North Jeffco Park & Recreation Hyland Hills Park & Recreation District Arvada West Town Center Business Improvement District Southwest Adams County Fire Protection District 2

2013 Percents Applicable To City of Arvada

$ 31,289,000

100.00%

473,965,000 86,835,000 6,835,000 10,390,000 5,345,000 388,100

15.36% 6.45% 82.91% 4.17% 100.00% 15.00%

Estimated Share of Overlapping Debt

$

31,289,000

72,821,394 5,597,728 5,666,824 432,939 5,345,000 58,222

Subtotal, overlapping debt

$ 121,211,107

Total, direct and overlapping debt

$ 152,500,107

Source: Jefferson County School District, Adams County Schools District, Jefferson County Parks, and Recreation District, Hylands Hills Park Recreation District, Southwest Adams County Fire Protection District, and City of Arvada Note: Overlapping governments listed above incorporate a portion of the City of Arvada. This percentage of the incorporated areas is used to calculate the estimated share of overlapping debt. This figure is taken into account to determine the City of Arvada's ability to issue and repay long-term debt.

126

CITY OF

ARVADA, COLORADO

City of Arvada Legal Debt Margin Information Last Ten Fiscal Years

Legal Debt Margin Calculation for Fiscal Year 2013 $10,638,594,560 319,157,837 0

0 319,157,837

2004 Debt Limit Total net debt applicable to limit Legal debt margin Total net debt applicable to the limit as a percentage of debt limit

2005

2006

2007

2008

2009

2010

2011

2012

2013

287,300,626

294,867,900

313,565,250

337,823,019

325,347,584

315,775,961

315,627,271

308,381,134

311,138,661

319,157,837

-

-

-

-

-

-

-

-

-

-

$ 287,300,626

$ 294,867,900

$ 313,565,250

$ 337,823,019

$ 325,347,584

$ 315,775,961

$ 315,627,271

$ 308,381,134

$ 311,138,661

$ 319,157,837

0.00%

0.00%

0.00%

0.00%

0.00%

0.00%

0.00%

0.00%

0.00%

0.00%

Source: Jefferson and Adams County Assessors' Offices Note: Chapter XI, Section 4 of the Charter of the City of Arvada: "The aggregate amount of bonds or other evidences of indebtedness shall not exceed three (3) percent of the actual value, as determined by the County Assessors of Jefferson County and Adams County, of the taxable property in the City of Arvada..." There are limited exceptions.

127

CITY OF

ARVADA, COLORADO

City of Arvada Pledged-Revenue Coverage Last Ten Fiscal Years

Year

Utility Service Charges

Less: Operating Expenses

2004 2005 2006 2007 2008 2009 2010 2011 2012 2013

20,405,000 20,075,000 35,876,000 27,144,000 24,695,000 17,759,000 19,815,000 21,541,000 25,827,000 34,174,000

11,262,000 12,519,000 18,140,000 13,481,000 14,455,000 14,625,000 15,099,000 15,046,000 15,520,000 16,434,000

Water Revenue Bonds Net Debt Service Available Revenue Principal Interest Coverage 9,143,000 7,556,000 17,736,000 13,663,000 10,240,000 3,134,000 4,716,000 6,495,000 10,307,000 17,740,000

1,195,000 408,721 1,250,000 713,999 1,300,000 946,425 1,360,000 959,164 1,415,000 1,054,494 1,540,000 944,004 1,550,000 697,288 1,630,000 626,495 1,680,000 577,346 1,730,000 529,565

5.70 3.85 7.90 5.89 4.15 1.26 2.10 2.88 4.57 7.85

Source: City of Arvada, Finance Department Note: Service charges include water sales, licenses and permit fees.

Operating expenses include operations, administration & maintenance, and tap fees.

Coverage represents the ratio of debt payments to net revenue avaliable.

Sales and use tax bonds are backed by the generation of sales and use tax revenues.

128

Sales and Use Tax Bonds Sales & Use Tax Increment 32,689,000 32,407,000 36,695,000 43,462,000 43,691,000 43,020,000 43,678,000 44,160,000 47,023,000 50,023,809

Debt Service Principal Interest 1,250,000 1,840,000 2,525,000 2,615,000 2,710,000 2,241,564 3,284,428 3,250,434 3,200,000 3,015,000

1,898,941 1,846,441 1,777,421 1,690,339 1,593,666 840,853 1,061,698 935,309 834,119 612,292

Coverage 10.38 8.79 8.53 10.09 10.15 13.96 10.05 10.55 11.66 13.79

CITY OF

ARVADA, COLORADO

Schedule of Debt Service Requirements Governmental Activities December 31, 2012

Sales & Use Tax Revenue Refunding Bonds - Series 2009

Year 2013 2014 2015 2016 2017 2018 TOTALS

Principal 1,935,000 1,990,000 2,045,000 2,105,000 3,885,000 $11,960,000

Interest 387,975 339,600 279,900 218,550 155,400 $1,381,425

Total Payment 2,322,975 2,329,600 2,324,900 2,323,550 4,040,400 $13,341,425

Principal Balance 11,960,000 10,025,000 8,035,000 5,990,000 3,885,000 $ -

Sales & Use Tax Revenue Refunding Bonds - Series 2013 2013 2014 2015 2016 2017 TOTALS

1,340,000 1,385,000 1,440,000 1,510,000 $5,675,000

243,100 202,900 147,500 75,500 $669,000

129

1,583,100 1,587,900 1,587,500 1,585,500 $6,344,000

5,675,000 4,335,000 2,950,000 1,510,000 $ -

CITY OF

ARVADA, COLORADO

Schedule of Debt Service Requirements Business-Type Activities December 31, 2012

Water Enterprise Revenue Refunding Bonds - Series 2009

Year 2013 2014 2015 2016 2017 2018 2019 2020 TOTALS

Principal 1,760,000 1,805,000 1,860,000 1,915,000 2,010,000 2,090,000 2,175,000 $13,615,000

Interest 500,700 456,700 402,550 346,750 251,000 170,600 87,000 $2,215,300

130

Total Payment 2,260,700 2,261,700 2,262,550 2,261,750 2,261,000 2,260,600 2,262,000 $15,830,300

Principal Balance 13,615,000 11,855,000 10,050,000 8,190,000 6,275,000 4,265,000 2,175,000 $ --

CITY OF

ARVADA, COLORADO

City of Arvada, Colorado Demographic and Economic Statistics Last Ten Calendar Years

Year

Population

Personal Income (in thousands of dollars)

2004 2005 2006 2007 2008 2009 2010 2011 2012 2013

102,655 103,004 105,455 107,050 106,327 107,702 108,539 106,433 106,673 109,157

2,166,328 2,885,863 2,345,530 3,236,229 2,968,862 3,523,040 3,216,987 3,316,346 3,297,902 3,374,698

Per Capita Income

Median Age

School Enrollment

Unemployment Rate

21,103 28,017 22,242 30,231 27,922 32,711 29,639 31,159 30,916 30,916

37.2 37.2 37.2 37.2 39.8 39.4 39.4 40.5 40.5 40.5

18,434 17,488 18,286 18,064 19,469 19,624 19,409 18,947 19,086 19,188

6.30% 5.70% 4.40% 4.30% 5.60% 8.10% 9.80% 8.30% 8.00% 6.50%

Source: Denver Regional Council of Governments, Adams and Jefferson County School Districts, Arvada Ecomonic Development Department, and Colorado Department of Labor and Employment

131

132 50,700 54,108

Total Employees

3,408

10

8 9

180 175

160

1 2 4 3 5 6 5 7

800 653 290 300 220 210 220 200

Employees Rank

Total Employed by Other Employers

Total Employed by Principal Employers

Sorin Group USA(formerly COBE Cardio) City of Arvada Sundyne Corporation Jefferson Ctr. For Mental Health Target Pridemark Paramedic Serv. Inc. Home Depot Costco Super Target Sam's Club King Soopers #36 Kohl's Dept. Store Severn Trent Laboratories/Test America Mark VII Equipment Employers Unity Tarco Yenter Companies Talx Corporation Xcel Energy Wanco Inc Colorado Credit Union League CCW Products Piper Electric Swinerton Builders Colorado Lutheran Home & Apts.

King Scoopers #45 Minolta Business Systems Denver Instrument Company King Sooper #3 Sundstrand Fluid Handling King Sooper #22 Glover United Masonry W.L. Contractors Cub Foods

Employer

2004

100.00%

93.70%

6.30%

0.30%

0.33% 0.32%

1.48% 1.21% 0.54% 0.55% 0.41% 0.39% 0.41% 0.37%

% of Total City Employment

55,126

51,521

3,605

780 660 320 300 220 210 200 200 200 180 175 160

1 2 3 4 5 6 7 7 7 8 9 10

Employees Rank

2005

100.00%

93.46%

6.54%

1.41% 1.20% 0.58% 0.54% 0.40% 0.38% 0.36% 0.36% 0.36% 0.33% 0.32% 0.29%

% of Total City Employment

56,888

53,837

3,051

160

9

10

157

6

200 7 8 9

5 4

220 300

180 175 160

2 1 3

450 699 350

100.00%

94.64%

5.36%

0.28%

0.28%

0.32% 0.31% 0.28%

0.35%

0.39% 0.53%

0.79% 1.23% 0.62%

% of Total City Employees Rank Employment

2006

City of Arvada Principal Employers Current Year and Nine Years Ago

57,940

54,817

3,123

9 8

7 8 10

160 150 140

143 150

6

4 5 5

2 1 3

Rank

180

275 200 200

450 705 370

Employees

2007

100.00%

94.61%

5.39%

0.25% 0.26%

0.28% 0.26% 0.24%

0.31%

0.47% 0.35% 0.35%

0.78% 1.22% 0.64%

% of Total City Employment

9 10

145 140

57,381

54,170

3,211

7

160

10

6 7

4 5 5

2 1 3

8

Rank

150

140

175 160

275 200 200

389 707 370

Employees

2008

100.00%

94.40%

5.60%

0.24%

0.25%

0.28%

0.26%

0.24%

0.30% 0.28%

0.48% 0.35% 0.35%

0.68% 1.23% 0.64%

% of Total City Employment

CITY OF

ARVADA, COLORADO

133

8 9

180 175

51,284 54,097

Total Employed by Other Employers

2,813

10

5 4 7 6

220 275 207 212

173

2 1 3

Rank

350 691 330

Employees

Total Employees

Total Employed by Principal Employers

Sorin Group USA(formerly COBE Cardio) City of Arvada Sundyne Corporation Jefferson Ctr. For Mental Health Target** Pridemark Paramedic Serv. Inc. Home Depot Costco Super Target ** Sam's Club King Soopers #36 Kohl's Dept. Store Severn Trent Laboratories/Test America Mark VII Equipment Employers Unity Tarco Yenter Companies Talx Corporation Xcel Energy Wanco Inc Colorado Credit Union League CCW Products Piper Electric Swinerton Builders Colorado Lutheran Home & Apts.

King Scoopers #45 Minolta Business Systems Denver Instrument Company King Sooper #3 Sundstrand Fluid Handling King Sooper #22 Glover United Masonry W.L. Contractors Cub Foods

Employer

2009

100.00%

94.80%

5.20%

0.32%

0.33% 0.32%

0.41% 0.51% 0.38% 0.39%

0.65% 1.28% 0.61%

% of Total City Employment

10

145

52,222

49,463

2,759

8

9

6 4 7 5

2 1 3

Rank

186

155

220 268 195 225

351 691 323

Employees

2010

100.00%

94.72%

5.28%

0.28%

0.36%

0.30%

0.42% 0.51% 0.37% 0.43%

0.67% 1.32% 0.62%

% of Total City Employment

56,842

54,051

2,791

189

200 268 180 225 218 155

351 682 323

Employees

City of Arvada Principal Employers Current Year and Nine Years Ago

8

7 4 9 5 6 10

2 1 3

Rank

2011

100.00%

95.09%

4.91%

0.33%

0.35% 0.47% 0.32% 0.40% 0.38% 0.27%

0.62% 1.20% 0.57%

% of Total City Employment

57,150

54,356

2,794

189

200 225 200 225 218 155

351 678 353

Employees

Rank

2012

9

7 4 7 4 6 10

3 1 2

100.00%

95.11%

4.89%

0.33%

0.35% 0.39% 0.35% 0.39% 0.38% 0.27%

0.61% 1.19% 0.62%

% of Total City Employment

55,972

53,274

2,698

95

124 370 200 234 200 156

294 672 353

Employees

Rank

2013

10

9 2 6 5 6 8

4 1 3

100.00%

95.18%

4.82%

0.17%

0.22% 0.66% 0.36% 0.42% 0.36% 0.28%

0.53% 1.20% 0.63%

% of Total City Employment

CITY OF

ARVADA, COLORADO

CITY OF

ARVADA, COLORADO

City of Arvada, Colorado Full-time Equivalent City Government Employees by Function/Program Last Ten Fiscal Years

2004

2005

2006

2007

2008

2009

2010

2011

2012

2013

City Manager's/Clerk's Office Community Development Cultural Services Economic Development Parks, Golf, and Hospitality Finance/Risk Management Judicial/Legal Information Technology Human Resources Public Works Public Safety

19.75 23.00 39.00 4.00 72.00 42.75 18.75 22.00 9.00 191.00 211.75

18.75 23.00 39.00 4.00 71.00 46.25 18.75 23.00 9.00 194.50 212.75

18.75 23.00 41.10 4.00 71.00 46.25 18.75 26.00 9.00 196.25 244.75

18.75 26.00 41.00 4.00 72.00 46.25 19.00 26.00 9.00 198.50 244.75

18.75 26.00 41.00 5.00 72.00 43.25 21.00 29.00 9.00 202.75 239.00

17.00 26.00 40.00 5.00 74.00 43.25 21.00 29.00 9.00 205.25 236.40

17.00 26.00 39.00 4.00 72.00 42.75 22.00 29.00 9.00 200.25 230.40

16.75 24.00 38.75 4.00 70.00 38.00 23.00 29.00 9.00 202.25 227.40

17.75 24.00 38.75 4.00 70.00 38.00 22.00 29.00 9.00 198.25 227.40

18.95 24.00 39.25 4.00 69.00 41.00 20.00 27.00 9.00 198.25 232.40

Total

653.00

660.00

698.85

705.25

706.75

705.90

691.40

682.15

678.15

682.85

Function/program

Source: City of Arvada Budget Book 2013-2014 Note: Figures represents budgeted full and part-time benefited employees.

134

CITY OF

ARVADA, COLORADO

City of Arvada, Colorado Operating Indicators by Function/Program Last Ten Fiscal Years

2004

2005

2006

Fiscal Year 2008 2009

2007

2010

2011

2012

2013

Function/Program General government Building permits issued Police Physical arrests Parking violations Traffic violations Other public works Street resurfacing (miles) Potholes repaired Parks and recreation Athletic field permits issued Water Consumers (Tap) New connections Leaks Average daily consumption (thousands of gallons)

5,414

4,692

5,077

4,619

5,852

14,582

8,552

5,019

5,718

5,293

3,134 564 10,830

3,148 292 9,296

3,112 473 9,062

3,005 489 10,385

3,067 458 10,448

2,655 314 11,513

2,373 442 10,366

2,384 468 8,776

2,272 436 12,351

2,338 831 12,451

14

4 2,409

17 8,858

6 1,343

8 2,716

18 6,723

42 1,547

43 2,175

28 2,866

20,560

21,111

21,651

23,356

22,062

21,989

20,830

21,871

22,965

22,276

34,266 297 61 17,500,000

34,548 324 54 15,200,000

34,368 300 48 17,900,000

34,528 178 66 16,000,029

35,082 131 66 16,300,000

35,104 74 37 13,761,000

35,100 167 47 15,828,849

35,644 141 39 15,805,112

36,177 342 47 18,561,650

36,492 445 47 14,984,589

9 ---

---

Source: City of Arvada Building Department, Police Department, Street Department, Parks Department, and Water Department.

Note: The average daily water consumption rate decreased approximately 19% due to 17.6 inches of moisture last year and 10.11 inches the previous year.

135

CITY OF

ARVADA, COLORADO

City of Arvada, Colorado Capital Assets Statistics by Function/Program Last Ten Fiscal Years

Function/Program Police Stations Patrol units Fire Protection Districts Other public works Streets (miles) Parks and recreation Square Miles (City of Arvada) Playgrounds Tennis/basketball Courts Baseball/softball diamonds Soccer/football fields Community centers/Sport complexes Water Water mains (miles) Fire hydrants Wastewater Sanitary sewers (miles) Storm sewers (miles) Treatment capacity (millions of gallons)

2004

2005

2006

Fiscal Year 2007

2008

2009

2010

2011

2012

2013

1 106 2

1 106 3

1 107 3

1 108 3

1 82 3

1 79 3

1 79 3

1 79 3

1 79 3

1 79 3

392

398

401

404

404

411

413

420

427

437

35 48 75 26 24 20

36 50 71 26 33 19

36 55 72 25 41 21

36 55 71 35 25 21

36 57 72 41 27 19

36 48 72 41 27 19

36 50 75 41 27 19

38 51 75 41 27 19

39 52 75 41 32 19

39 57 77 43 32 19

542 4,547

560 4,606

540 4,640

542 4,676

550 4,639

551 4,650

568 4808

572 4768

589 4889

602 5018

391 127 3,172

434 125 3,104

392 144 3,160

392 136 3,401

396 140 3,430

400 144 3,256

408 145 3,295

410 148 3,548

416 151 3,387

423 151 3,750

Source: City of Arvada, Police, Parks & Rec, Public Works Departments

136

City of Arvada 8101 Ralston Road, Arvada, CO 80002