Document Lafayette_doc_5fd3e875d2

COMPREHENSIVE ANNUAL FINANCIAL REPORT FOR THE YEAR ENDED DECEMBER 31, 2010 City of Lafayette, Colorado ---PAGE BREAK--- COMPREHENSIVE ANNUAL FINANCIAL REPORT FOR THE YEAR ENDED DECEMBER 31, 2010 City of Lafayette Statement of Vision Lafayette’s panoramic view of the Rocky Mountains inspires our view into the future. We value our heritage, our unique neighborhoods, a vibrant economy and active life-styles. We envision a future that mixes small town livability with balanced growth and superior technologies. City of Lafayette, Colorado Prepared By: Finance Department 2010 ---PAGE BREAK--- CITY OF LAFAYETTE, COLORADO COMPREHENSIVE ANNUAL FINANCIAL REPORT For the Fiscal Year Ended December 31, 2010 TABLE OF CONTENTS INTRODUCTORY SECTION Letter of Transmittal 6 GFOA Certificate of Achievement 11 Organizational Chart 12 Directory of City Officials 13 FINANCIAL SECTION Independent Auditors’ Report 15 Management’s Discussion and Analysis 16 Basic Financial Statements: Government-wide Financial Statements: Statement of Net Assets 28 Statement of Activities 29 Fund Financial Statements: Balance Sheet – Governmental Funds 30 Reconciliation of the Governmental Funds Balance Sheet to the Government Wide Statement of Net Assets 32 Statement of Revenues, Expenditures, and Changes in Fund Balances – Governmental Funds 33 Reconciliation of the Statement of Revenues, Expenditures, and Changes in Fund Balances of Governmental Funds to the Statement of Activities 35 Statement of Net Assets – Proprietary Funds 36 Statement of Revenues, Expenses, and Changes in Fund Net Assets – Proprietary Funds 38 Statement of Cash Flows – Proprietary Funds 40 Notes to the Financial Statements 45 Required Supplementary Information: Schedule of Funding Progress – Volunteer Firefighters’ Pension Plan 79 Budgetary Comparison Schedule – General Fund 80 Budgetary Comparison Schedule – Lafayette Urban Renewal Authority 84 Note to Required Supplementary Information 85 Combining and Individual Fund Statements and Schedules: Combining Balance Sheet – Nonmajor Governmental Funds 89 Combining Statement of Revenues, Expenditures, and Changes in Fund Balances – Nonmajor Governmental Funds 90 Combining Balance Sheet – Nonmajor Special Revenue Funds 91 Combining Statement of Revenue, Expenditures, and Changes in Fund Balance – Nonmajor Special Revenue Funds 92 Budgetary Comparison Schedule – Ambulance and Fire 93 Budgetary Comparison Schedule – Lafayette City Center GID 94 Budgetary Comparison Schedule – Exempla GID 95 Budgetary Comparison Schedule – Lafayette Corporate Campus GID 96 Budgetary Comparison Schedule – Lafayette Tech Center GID 97 Combining Balance Sheet – Nonmajor Capital Project 98 Combining Statement of Revenue, Expenditures, and Changes in Fund Balance – Nonmajor Capital Project Funds 99 Budgetary Comparison Schedule – Storm Drainage 100 Budgetary Comparison Schedule – Legacy Open Space Fund 101 3 ---PAGE BREAK--- FINANCIAL SECTION (CONTINUED) Combining and Individual Fund Statements and Schedules (continued): Budgetary Comparison Schedule – Parks, Open Space & Trails Fund 102 Budgetary Comparison Schedule – Conservation Trust Fund 103 Budgetary Comparison Schedule – Capital Projects Fund 104 Budgetary Comparison Schedule – Debt Service Fund 105 Budgetary Comparison Schedule – Cemetery Endowment Fund 106 Combining Statement of Net Assets – Internal Service Funds 108 Combining Statement of Revenues, Expenses, and Changes in Fund Net Assets – Internal Service Funds 109 Combining Statement of Cash Flows – Internal Service Funds 110 Budgetary Comparison Schedule – Employee Benefit Fund 111 Budgetary Comparison Schedule – Insurance Fund 112 Budgetary Comparison Schedule (Non-GAAP Budgetary Basis) – Water Utility 113 Budgetary Comparison Schedule (Non-GAAP Budgetary Basis) – Water Reclamation....... 114 Budgetary Comparison Schedule (Non-GAAP Budgetary Basis) – Golf Course .115 Budgetary Comparison Schedule (Non-GAAP Budgetary Basis) – Storm Water 116 STATISTICAL SECTION Financial Trends: Net Assets, Last Nine Years (Schedule 1) 119 Changes in Net Assets, Last Nine Years (Schedule 2) 121 Fund Balances, Governmental Funds, Last Nine Years (Schedule 3) 125 Changes in Fund Balances, Governmental Funds, Last Nine Years (Schedule 4) 127 Revenue Capacity: General Governmental Tax Revenues by Source – All Governmental Fund Types (Schedule 5) 131 Direct and Overlapping Sales Tax Rates (Schedule 6) 132 Principal Sales and Use Tax Payers (Schedule 7) 133 Debt Capacity: Ratio of Outstanding Debt, by Type, Last Nine Years (Schedule 8) 135 Ratio of General Bonded Debt Outstanding and Legal Debt Limit (Schedule 9) 137 Direct and Overlapping Governmental Activities Debt (Schedule 10) 139 Pledged-Revenue Coverage, Last Nine Years (Schedule 11) 140 Demographic and Economic Information: Demographic and Economic Statistics and Top Ten Employers for 1999 and 2008, Last Nine Years (Schedule 12) 144 Operating Information: Full-time Equivalent City Employees by Function/Program (Schedule 13) 145 Operating Indicators by Function/Program (Schedule 14) 147 Capital Asset Statistics by Function/Program (Schedule 15) 148 COMPLIANCE SECTION Local Highway Finance Report 150 4 ---PAGE BREAK--- COMPREHENSIVE ANNUAL FINANCIAL REPORT FOR THE YEAR ENDED DECEMBER 31, 2010 INTRODUCTORY SECTION 2010 5 ---PAGE BREAK--- Finance Department 1290 S. Public Road  Lafayette, Colorado 80026  (303) 665-5588 Fax (303) 665-2153 June 9, 2011 Honorable Mayor, Members of the City Council, and Citizens of Lafayette, Colorado Ladies and Gentlemen: The comprehensive annual financial report (CAFR) of the City of Lafayette, Colorado for the fiscal year ended December 31, 2010, is hereby submitted. The City is responsible for the accuracy of the data, and the completeness and fairness of the presentation, including all disclosures. To the best of our knowledge and belief, the enclosed report is accurate in all material respects and is reported in a manner designed to present fairly the financial position and results of operations of the various funds and account groups of the City. All disclosures necessary to enable the reader to gain an understanding of the City's financial activities have been included. The CAFR is presented in four sections: introductory, financial, statistical, and compliance. The introductory section includes this transmittal letter, the City’s organizational chart and a list of principal officials. The financial section includes Management’s Discussion and Analysis (MD&A), the government-wide financial statements (GWFS), and the combining and individual fund financial statements and schedules, as well as the independent auditors’ report on the financial statements and schedules. The statistical section includes selected financial and demographic information, generally presented on a multi-year basis. The compliance section includes the State required Local Highway Finance Report. State statutes and the City Charter require an annual audit by independent certified public accountants. The accounting firm of Swanhorst & Company LLC was selected to perform the audit. Their auditors’ report on the GWFS and combining and individual fund statements and schedules is included in the financial section of this report. Management of the City is responsible for establishing and maintaining internal controls. Controls should be designed to ensure that the assets of the City are protected from loss, theft or misuse. They should ensure that adequate accounting data is compiled so that the financial statements can be prepared in conformity with generally accepted accounting principles (GAAP). The internal controls are reviewed as a part of the City’s annual audit. They are 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 ---PAGE BREAK--- likely to be derived; and the valuation of costs and benefits requires estimates and judgments by management. Generally accepted accounting principles (GAAP) require that management 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 designed to complement MD&A and should be read in conjunction with it. The City of Lafayette MD&A can be found immediately following the report of the independent auditors. The City provides a full range of services. These services include police and fire protection; ambulance; water and sanitary sewer services; the construction and maintenance of streets and infrastructure; recreational activities and cultural events. This report includes all funds of the primary government – General Fund, Debt Service Fund, Capital Projects Funds, and proprietary funds. Six Special Revenue Funds are also included in this report. Five of the funds are reported as blended component units. These component units are legally separate organizations for which the City of Lafayette is financially accountable. City Council acts as the governing board for each of them. Profile of the Government The City of Lafayette is located on the northern edge of the Denver Metropolitan area, situated in southeastern Boulder County, Colorado. The City enjoys a central location between Boulder, Denver, and Longmont. It has good highway access to the entire region, with Interstate 25 located 6 miles east, the Northwest Parkway located on the City’s Southern edge, and the U S 36 Freeway (Boulder Turnpike) 5 miles south of the City. The four-lane U S Highway 287 and two- lane Colorado State Highway 7 intersect in the City. Lafayette’s location, accessibility, and “small town feel” combine to make the City a desirable location for residential, commercial, and light-industrial development. According to the 2010 U S Census, Lafayette had a population of 24,453 in 2010 living in its 8.6 square mile area (31st in the state), up from 23,197 people in a 8.6 square mile area in 2000 (21st in the state). Lafayette is a home-rule city, meaning that the organization and operation of our municipal government is conducted according to the Charter of the City of Lafayette. This Charter, adopted by the electorate in 1958, provides for a strong Council/Administrator form of government. It is designed to provide the maximum of teamwork among the members of the Council. The Council is composed of seven members, who are elected on a non-partisan basis from the city at large. Provision is made for the overlapping of terms with a majority of the Council to be elected every two years. Council selects its own team leader, the Mayor, who presides at public meetings and represents the City in interactions with other governmental entities. The Council is the policy-determining or overall governing agent of the city, having power to pass ordinances, determine policy and appoint the City Administrator and the Chief of Police. The City Administrator is hired by the Council to implement their policies and directives, and to 7 ---PAGE BREAK--- oversee the daily administration and management of all City departments. The Municipal Judge and City Attorney are appointed by, and report to, City Council. The organization of the city government was created to assure maximum flexibility in organizational structuring, to allow for adjustment to new demands and changing circumstances as Lafayette grows and prospers. The Charter includes provisions for proper budgeting, fiscal control, auditing, and economical fiscal procedures. The annual budget serves as the foundation of the City’s financial planning and control. The objective of these budgetary controls is to ensure compliance with legal provisions. Compliance is embodied in the annual appropriated budget approved by the City Council. The level of budgetary control (that is, the level at which expenditures cannot legally exceed the appropriated amount) is established at the fund level. The City Council may make additional appropriations or budgetary transfers during the fiscal year for unanticipated revenues received by the City. The City Administrator may re-allocate the budget between departments within the same fund. Any budget revisions affecting fund totals are adopted in a supplemental appropriation ordinance approved by the Council. The City Council and Department Heads receive reports during the year comparing budgeted amounts to actual expenditures. Capital project budget appropriations lapse upon completion of each project. All other appropriations lapse at year-end. As demonstrated by the statements and schedules included in the financial section of this report, the City continues to meet its responsibility for sound financial management. Detailed budget to actual comparisons are provided in this report for the General Fund, Lafayette Urban Renewal Authority, Capital Projects, non-major governmental funds, and proprietary funds. Factors Affecting Financial Condition Local Economy The City has been able to minimize the affects of the current economic downturn by maintaining a conservative budget. Construction activity almost ceased during 2008 due to the availability of credit, and has remained dormant through 2009 and 2010 with the exception of the Prana apartment complex that broke ground in 2009, and commercial developments along South Boulder Road between South Public Road and Highway 287. Other proposed developments, both residential and commercial, have been postponed until economic conditions improve. Economic development efforts the past two years created substantial commercial redevelopment of four significant commercial properties that were previously vacated, including a major grocery and hardware store that ceased business. In late 2010, the two newest properties were occupied by new retail businesses that are projected to generate more sales taxes than the previous ones. The remaining commercial property in the vicinity has been converted to a church campus. 8 ---PAGE BREAK--- Businesses continue to be interested in eventually locating in the City. Commercial activity is poised to continue on, especially on the South end of the City, as soon as businesses can rely on a more stable environment. The City continues its efforts to improve the quality of life within its borders by attracting desirable development. In addition, emphasis has been placed on small business retention and attracting new businesses within the community. Economic development activities promoted by the City are responsible for new business development, as well as business retention. These activities are essential at this time in order to take advantage of opportunities that occur in the future as the economy improves. Elements of sound economic expansion such as transportation, recreation facilities, planning considerations, and managed growth policies continue to be key issues. The City is confident that the long-term consequences of efforts in these areas will serve to maintain the City's competitive position and foster economic expansion. Such efforts are consistent with the City's goal of protecting the quality of life and the long-term financial interests of the citizenry. Long Term Financial Planning During the budget preparation process, capital needs are projected five years into the future, along with anticipated revenues and related operating expenditures. These projections are updated each year. Colorado’s water resources continue to be a critical component of the City’s ability to service its population and grow. Over the past few years, the City has been actively engaged in improving its sources and storage of water. The City was admitted to the Northern Colorado Water Conservancy District in order to diversify the portfolio and obtain a major source of water supply from the western slope. The City is currently participating in two major regional water storage projects – Windy Gap & Northern Integrated Supply Project. Both of these projects are being managed by the Northern Colorado Water Conservancy District. The objective is long term water storage to provide a water source to mitigate future droughts. Mandated water quality improvements and other cost increases have applied pressure to the billing rate structure. In addition, development fees are lagging due to the economy, which is not expected to improve significantly for some time. A program for increasing water rates 5% annually over a five year period is being implemented in 2011. Lafayette continues its efforts to provide quality sanitary sewer services to the citizens. Expansion of the water reclamation plant began in 2001 and was completed in 2004 at a cost of approximately $8 million. Additional improvements may be required soon in order to meet State imposed permit standards. Most recently, increased operating costs forced sewer rates to be increased 9% in 2010. Double digit increases are scheduled for the next four years. As part of the US Highway 287 realignment, the City acquired Public Road in April 1996. Public Road, which was part of the old Highway 287, is the main north-south thoroughfare in the heart of downtown Lafayette. Even after the US 287 realignment, Public Road continues to have 9 ---PAGE BREAK--- unusually high traffic volumes for a “bypassed” road. The City has placed a high priority on public and private improvements along this one-mile stretch of road in the City’s old town area. Public Road was repaved in 2010 and the City continues to focus its efforts on urban renewal. Awards 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 for its Comprehensive Annual Financial Report for the fiscal year ended December 31, 2009. This was the 23rd consecutive year the City has received this prestigious award. In order to be awarded a Certificate of Achievement, the City published an easily readable and efficiently organized Comprehensive Annual Financial Report. This report must satisfy both 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’s requirements, and we are submitting it to the GFOA to determine its eligibility for another certificate. Acknowledgments The dedicated service of Accounting Manager Wade Nickerson, Accountant Jill Johnson, and the entire staff of the Finance Department’s Accounting Division went into the preparation of the 2010 CAFR. Each and every member of our staff has our sincere appreciation for the contributions they made in order to complete the 2010 CAFR. In closing, without the leadership and support of Lafayette’s Mayor and City Council members, preparation of this report would not have been possible. Sincerely, Gary Klai$iake, C4M Robert E. Wright, CPM’ City Administrator Finance Director 10 ---PAGE BREAK--- Certificate of Achievement for Excellence in Financial Reporting Presented to City of Lafayette Colorado For its Comprehensive Annual Financial Report for the Fiscal Year Ended December 31, 2009 A Certificate ofAchievement for Excellence in Financial Reporting is presented by the Government Finance Officers Association of the United States and Canada to government units and public employee retirement systems whose comprehensive annual financial reports (CAFRs) achieve the highest standards in government accounting and financial reporting. IL?) President Executive Director 11 ---PAGE BREAK--- CITIZENS OF LAFAYETTE CITY ATTORNEY - Municipal Prosecution MUNICIPAL JUDGE - Traffic Violations - Code Violations CITY ADMINISTRATOR - General City Administration - Boards and Commissions - Human Resources - Risk Management BOARDS & COMMISSIONS - Planning Commission - Lafayette Cultural Arts Commission - Zoning Board of Adjustment - Library Board - Open Space Advisory Board - Employee Pension Board - Senior Services Advisory Board - Waste Reduction Advisory Committee - Historic Preservation Board - Youth Advisory Committee - Outdoor Classroom Task Force - Urban Renewal/Architectural Review Committee - Public Art Committee - Latino Advisory Board - Energy Sustainability Advisory Committee - Downtown Action Committee FINANCE - Accounting - Budget - Utility Billing - Cash Management - Information Technologies - Ambulance Billing COMMUNITY LIFE - Library - Senior Services - Cultural Arts - Local History RECREATION & FACILITY MANAGEMENT - Recreation Leisure Programs Aquatics - Recreation Center - Building Maintenance COMMUNITY DEVELOPMENT - Economic Development - Urban Renewal - Community Housing Program - Planning Current Long Range - Building Code Administration Inspection - Code Enforcement - Historical Preservation POLICE - Patrol - Investigation - Animal Control - Emergency Management - School Resource Officers - Records & Evidence - Community Affairs Unit FIRE - Suppression - Inspection - Training - EMS CITY COUNCIL CITY CLERK - Records Management - Licensing - Court Administration - Elections - Cemetery ‐ Broadcast Services PUBLIC WORKS - Engineering - Equipment Maintenance - Storm Drainage - Streets/Traffic Control - Utilities Water Water Reclamation PARKS, OPEN SPACE & GOLF - Parks - Cemeteries - Open Space - Golf Course 12 ---PAGE BREAK--- CITY OF LAFAYETTE, COLORADO CITY COUNCIL Standing from l. to City Attorney Dave Williamson, Councilor Schatz, Mayor Pro Tem Ruggeri, Councilor Buechner, Councilor d'Oronzio, City Administrator Gary Klaphake. Seated, l. to Councilor Lupberger, Mayor Phillips, Councilor Cutler ADMINISTRATION Gary Klaphake City Administrator Elizabeth Stroomer Community Life Director Robert Wright Finance Director Doug Short Public Works Director Gerry Morrell Fire Chief Rick Bashor Police Chief Monte Stevenson Parks, Open Space & Golf Director Curt Cheesman Recreation and Facilities Management Director Phillip Patterson Community Development Director Susan Koster City Clerk Roger Buchholz Municipal Court Judge David Williamson City Attorney Peter Johnson City Engineer 13 ---PAGE BREAK--- COMPREHENSIVE ANNUAL FINANCIAL REPORT FOR THE YEAR ENDED DECEMBER 31, 2010 FINANCIAL SECTION 2010 14 ---PAGE BREAK--- ( Swanhorst & Company LLC Public AccouIrturLs Honorable Mayor and Members of the City Council City of Lafayette Lafayette, Colorado INDEPENDENT AUDITORS’ REPORT We have audited the accompanying financial statements of the governmental activities, the business-type.activities, each major fund, and the aggregate remaining fund information of the City of Lafayette as of and for the year ended December 31, 2010, which collectively comprise the basic financial statements of the City of Lafayette, as listed in the table of contents. These financial statements are the responsibility of the City of Lafayette’s management. 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 ofAmerica. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audit provides a reasonable basis for our 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, each major fund, and the aggregate remaining fund information of the City of Lafayette as of December 31, 2010, and the respective changes in financial position and cash flows, where applicable, for the year then ended in conformity with accounting principles generally accepted in the United States of America. The management’s discussion and analysis and required supplementary information listed in the table of contents are not a required part of the basic financial statements but are supplementary information required by the Governmental Accounting Standards Board. We have applied certain limited procedures, which consisted principally of inquiries of management regarding the methods ofmeasurement and presentation ofthe req uired supplementary information. However, we did not audit the information and express no opinion on it. Our audit was conducted for the purpose of forming opinions on the financial statements that collectively comprise the City ofLafayette’s basic financial statements. The combining and individual fund statements and schedules and local highway finance report listed in the table of contents are presented for purposes of additional analysis and are not a required part of the basic financial statements. Such information has been subjected to the auditing procedures applied in the audit of the basic financial statements and, in our opinion, is fairly stated in all material respects in relation to the basic financial statements taken as a whole. The introductory and statistical sections have not been subjected to the auditing procedures applied in the audit ofthe basic financial statements and, accordingly, we express no opinion on them. t%fa 4Z- June 9, 2011 840() E. Crescent Parkway Suite 600 Greenwood Village, CO 80111 (720) 528-4306 Fax: (720) 528-4307 ---PAGE BREAK--- Management’s Discussion and Analysis Our discussion and analysis of the City of Lafayette’s financial statements for the year ended December 31, 2010, provides a narrative overview of its financial activities. Please consider the information presented here in conjunction with additional information that we have furnished in our letter of transmittal and the City’s financial statements. Financial Highlights: As the City’s investments mature, it has been difficult to reinvest in instruments that yield more than Beginning in 2009, and continuing on into 2010, the City focused on the prepayment of debt issues maturing within a few years in order to use the available funds more efficiently, and to create more financial flexibility for the future. As soon as the credit market has stabilized, the City plans to refund two longer term debt issues. In addition, the City is not incurring additional debt for smaller capital projects. Funds are being accumulated for the construction of a new fire station at the Exempla location, and the cost of a new fire truck was paid in advance at a discount of approximately 3.5%. More specific detail is as follows:  The assets of the City of Lafayette exceeded its liabilities at the close of 2010 by $238 million (net assets). Of this amount, $46 million, or 19%, is unrestricted and may be used to meet the City’s ongoing obligations to citizens and creditors.  General sales tax revenue decreased by 0.41% from 2009. Only significant economic development activity prevented a further decline. Use tax revenues decreased 2% due mostly to lack of construction projects.  Due to the low interest rate environment, the City prepaid $1,329,585 in outstanding debt. It included a lease purchase arrangement in the amount of $174,585, and a 1999 Water Bond issue in the amount of $1,155,000.  Net Assets increased 0.6% or $1.4 million from 2009.  At the close of 2010 the City’s unassigned General Fund balance was $5 million on a modified accrual basis, a $3.2 million decrease from 2009 caused by assigning $3.8 million to street improvements. Overview of the Financial Statements: This discussion and analysis is intended to serve as an introduction to the City of Lafayette’s basic financial statements. The City’s basic financial statements comprise three components: 1) government- wide financial statements, 2) fund financial statements, and 3) notes to the financial statements. This report also contains other supplementary information in addition to the basic financial statements themselves. Government-wide financial statements. The government-wide financial statements are designed to provide readers with a broad overview of the City of Lafayette finances, in a manner similar to a private- sector business. 16 ---PAGE BREAK--- The statement of net assets presents information on all of the City of Lafayette’s assets and liabilities, with the difference between the two reported as net assets. Over time, increases or decreases in net assets may serve as a useful indicator of whether the financial position of the City of Lafayette is improving or deteriorating. The statement of activities presents information showing how the City’s net assets changed during the most recent fiscal year. All changes in net assets are reported as soon as the underlying event giving rise to the change occurs, regardless of the timing of related cash flows. Thus, revenues and expenses are reported in this statement for some items that will only result in cash flows in future fiscal periods uncollected taxes and earned, but unused, vacation leave). Both of the government-wide financial statements distinguish functions of the City of Lafayette that are principally supported by taxes and intergovernmental revenues (governmental 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 of Lafayette include general government, judicial, public safety, public works, and culture and recreation. The business-type activities of the City include the water utility, water reclamation fund, storm water fund, and a golf course operation. Fund financial statements. A fund is a grouping of related accounts that is used to maintain control over resources that have been segregated for specific activities or objectives. The City of Lafayette, like other state and local governments, uses fund accounting to ensure and demonstrate compliance with finance-related legal requirements. All of the funds of the City can be divided into two categories: governmental funds and proprietary funds. Governmental funds. Governmental funds are used to account for essentially the same functions reported as governmental activities in the government-wide financial statements. However, unlike the government-wide financial statements, governmental fund financial statements focus on near-term inflows and outflows of spendable resources, as well as on balances of spendable resources available at the end of the fiscal year. Such information may be useful in evaluating a government’s near-term financing requirements. Because the focus of governmental funds is narrower than that of the government-wide financial statements, it is useful to compare the information presented for governmental funds with similar information presented for governmental activities in the government-wide financial statements. By doing so, readers may better understand the long-term impact of the City’s near-term financing decisions. Both the governmental fund balance sheet and the governmental fund statement of revenues, expenditures, and changes in fund balances provide a reconciliation to facilitate this comparison between governmental funds and governmental activities. Proprietary funds. The City of Lafayette maintains two different types of proprietary funds. Enterprise funds are used to report the same functions presented as business-type activities in the government-wide financial statements. The City of Lafayette uses enterprise funds to account for its water utility, water reclamation, storm water, and for its golf course operation. 17 ---PAGE BREAK--- The second type of proprietary fund includes the Internal Service funds. Internal Service funds are an accounting device used to accumulate and allocate costs internally among the City of Lafayette’s various functions. The City uses internal service funds to account for its insurance and employee benefits. Because both of these services predominantly benefit governmental rather than business-type functions, the assets and liabilities of the internal service funds have been included within governmental activities in the government-wide financial statements. Proprietary funds provide the same type of information as the government-wide financial statements, only in more detail. The proprietary fund financial statements provide separate information for the Water, Water Reclamation, and Golf Course funds (all major funds), and the Storm Water fund (nonmajor fund). Conversely, since they are defined as proprietary funds, both internal service funds are combined into a single, aggregated memo presentation in the proprietary fund financial statements. Individual fund data for the internal service funds is provided in the form of combining statements elsewhere in this report. Notes to the financial statements. The notes provide additional information that is essential to a full understanding of the data provided in the government-wide and fund financial statements. Other information. In addition to the basic financial statements and accompanying notes, this report also presents certain required supplementary information concerning the City of Lafayette’s progress in funding its obligation to provide pension benefits to its volunteer firefighters and a budgetary comparison schedule for the General Fund, the Lafayette Urban Renewal Authority, and the Capital Projects Fund. The combining statements referred to earlier in connection with nonmajor governmental funds and internal service funds are presented immediately following the required supplementary information. Government-wide Financial Analysis The Statement of Net Assets and Statement of Activities for 2010 are compared with the results of 2009 in order to measure the impact of the current economic slump and to review the City’s progress towards maintaining financial stability. Analysis of Net Assets As noted earlier, net assets may serve over time as a useful indicator of a government’s financial position. In the case of the City of Lafayette, assets exceeded liabilities by $238 million at the close of 2010, an increase of 0.6% from 2009. The following table reflects amounts in thousands of dollars. 18 ---PAGE BREAK--- Governmental Activities Business-type Activities Total 2010 2009 2010 2009 2010 2009 Current and Other Assets $ 36,204 $ 39,147 $ 31,507 $ 32,776 $ 67,711 $ 71,923 Capital Assets 132,889 130,356 96,073 97,035 228,962 227,391 Total Assets 169,093 169,503 127,580 129,811 296,673 299,314 Long-term Liabilities Outstanding 24,897 26,717 22,939 24,885 47,836 51,602 Other Liabilities 9,883 8,944 818 2,046 10,701 10,990 Total Liabilities 34,780 35,661 23,757 26,931 58,537 62,592 Net Assets: Invested in Capital Assets, net of related debt 109,360 108,132 75,295 74,987 184,655 183,119 Restricted 7,219 8,203 - - 7,219 8,203 Unrestricted 17,734 17,507 28,528 27,893 46,262 45,400 Total Net Assets $ 134,313 $ 133,842 $ 103,823 $ 102,880 $ 238,136 $ 236,722 Current and other assets decreased a net of $4 million due primarily to the conversion of restricted cash into capital assets. Proceeds from the 2008 Sales and Use Tax bond issue were used for street improvements in 2010. Approximately $1 million of the 2003 Water Revenue bond issue was used for completion of the cover over the treatment basins and acquisition of water rights. By far the largest portion of the City’s net assets (77%) reflects its investment in capital assets (e.g. land, buildings, machinery, equipment, and infrastructure) less any related debt used to acquire those assets that is still outstanding. The City uses these capital assets to provide services to citizens; consequently, these assets are not available for future spending. Although the City’s investment in its 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. Capital assets in governmental activities increased during 2010 primarily as a result of developer dedicated land and rights-of-way, which amounted to $1.8 million and street improvements ($2.5 million). Long-term liabilities decreased $3.8 million from planned debt service payments and prepayment of certain debt issues. The decrease in restricted net assets was attributed primarily to the reduction in the long term note receivable, as evidenced by the Special Item. 19 ---PAGE BREAK--- Changes in Net Assets The City’s total revenues of $40.1 million exceeded expenses of $37.5 million resulting in an increase before transfers and special items of $2.6 million. The key elements of this increase are presented in the following table, reflected in thousands of dollars: Governmental Activities Business-type Activities Total Government Program revenues: 2010 2009 2010 2009 2010 2009 Charges for services $ 4,703 $ 4,110 $ 9,292 $ 9,285 $ 13,995 $ 13,395 Operating grants 1,357 1,311 - - 1,357 1,311 Capital grants & contributions 3,271 11,422 3,134 2,360 6,405 13,782 General revenue: Property taxes 6,479 6,367 - - 6,479 6,367 Sales and use taxes 10,181 10,250 - - 10,181 10,250 Interest 301 355 327 408 628 763 Gain on sale of property 43 1 - - 43 1 Franchise Taxes 982 913 - - 982 913 Other general revenues 34 31 - - 34 31 Total revenues 27,351 34,760 12,753 12,053 40,104 46,813 Program expenses: General government 6,911 5,576 - - 6,911 5,576 Judicial 311 284 - - 311 284 Public safety 7,588 7,216 - - 7,588 7,216 Public works 5,466 4,607 - - 5,466 4,607 Culture and recreation 5,921 5,873 - - 5,921 5,873 Interest on long-term debt 1,125 1,261 - - 1,125 1,261 Water - - 5,483 5,357 5,483 5,357 Water reclamation - - 2,770 2,709 2,770 2,709 Golf course - - 1,634 1,687 1,634 1,687 Storm water - - 306 218 306 218 Total expenses 27,322 24,817 10,193 9,971 37,515 34,788 Excess before transfers & special items 29 9,943 2,560 2,082 2,589 12,025 Special Items: Adjustment of asset held for resale - (632) - - - (632) Gain on fire conversion - 105 - - - 105 Adjustment of note receivable (1,175) - - - (1,175) - Transfers 1,617 1,548 (1,617) (1,548) - - Increase in net assets $ 471 $ 10,964 $ 943 $ 534 $ 1,414 $ 11,498 Governmental activities During 2010, net assets in governmental activities increased by $0.5 million. Charges for services decreased $0.6 million from 2009 largely due to the collection of building permit fees on the Prana apartment complex at the end of 2009. Capital grants and contributions decreased $8.1 million from the Exempla GID bond redemption ($6.5 million) and developer dedications ($1.6 million). Property taxes increased as a result of higher property assessments and the ambulance and fire mill levy. Property assessments lag the direction of the economy and are forecasted to decrease by 2012. Interest revenues decreased as expected from falling interest rates. Program expenses increased during the year by 10%, or $2.5 million. Approximately 50% of the increase is attributed to economic development costs, and the balance to street maintenance and public safety. The economic development costs were funded by the sale of the Albertson’s property held for resale since 2003. 20 ---PAGE BREAK--- $1,000,000 $2,000,000 $3,000,000 $4,000,000 $5,000,000 $6,000,000 $7,000,000 $8,000,000 General Government Judicial Public Safety Public Works Culture and Recreation Interest and Fiscal Charges 2010 Expenses and Program Revenues - Governmental Activities Expenses Program Revenues As defined in the footnotes, program revenues are directly associated with a specific activity. However, program revenues account for 34% of total revenues related to governmental activities in 2010. General revenues, consisting mostly of taxes, are not directly associated with any governmental function, and are not included in the above chart. Total revenues from governmental activities are summarized below. Charges for services 17% Operating grants 5% Capital grants 12% Property taxes 24% Sales and use taxes 37% Interest 1% Other general revenues 4% 2010 Revenues by Source - Governmental Activities Business-type activities Net assets in business-type activities increased by $0.9 million during 2010 after transfers. Developer dedications increased $0.8 million over 2009 as a result of the Prana apartment complex. Interest revenues decreased reflecting the direction of the investment market. Expenses increased in all areas except for the Golf Course. The latter expenditures were reduced to accommodate the lack of golfing activity. The following chart demonstrates the comparison of expenses and program revenues for business-type activities. 21 ---PAGE BREAK--- - 1,000,000 2,000,000 3,000,000 4,000,000 5,000,000 6,000,000 7,000,000 8,000,000 Water Water Reclamation Golf Course Storm Water 2010 Expenses and Program Revenues - Business-type Activities Expenses Program Revenues Financial Analysis of the City’s Funds Governmental Funds – Information on the major governmental funds of the City follows the government wide financial statements. These funds are accounted for using the modified accrual basis of accounting. At the end of 2010, the city reported a combined fund balance of $21.9 million, a decrease of $2.7 million. The decrease consisted primarily of the Capital Projects Fund spending the remaining street bond proceeds in 2010 of over $3 million. The General Fund is the primary operating fund of the city. At the end of 2010, the unassigned fund balance of the General Fund was $5 million, a slight increase of $0.2 million created by curtailing operating expenditures. The remainder of the fund balance is, either not in spendable form, such as prepaid items and inventory, or not available for new spending and is restricted, committed, or assigned as follows: Restricted – Administrator Severance Package $ 628,626 Capital Projects – Northwest Parkway 372,680 Grants 76,098 Committed – Public Works Projects 969,057 Parks and Recreation 248,322 Assigned – Debt Service Payments 875,099 Future Operating Expenses 352,643 Street Improvements 3,800,000 Fund balances for the Lafayette Urban Renewal Authority of $676,240, the Capital Projects Fund of $573,252, and non-major funds are committed, restricted, or assigned to the specific purpose of each fund. Proprietary Funds – Information on the proprietary funds provide the same type of information found in the government-wide statements, but with more detail. At the end of 2010, the City reported unrestricted net assets of $28.5 million, an increase of $0.6 million. Other factors concerning the finances of these funds have been discussed above in the business-type activities section. 22 ---PAGE BREAK--- General Fund Budgetary Highlights The City’s final budget differs from the original budget in that it contains carry forward appropriations for various programs and projects, and supplemental appropriations approved during the year. The General Fund accounts for all of the general services provided by the City of Lafayette. At the end of 2010, the fund balance of the General Fund had decreased by approximately $0.4 million to $13.3 million as mentioned above. The unassigned fund balance decreased by approximately $3.2 million primarily after assigning $3.8 million to street improvements. The following chart presents a summary of the major revenue sources of the City’s General Fund. - 2,000,000 4,000,000 6,000,000 8,000,000 10,000,000 12,000,000 2010 Budget & Actual Revenue by Source - General Fund Budget Actual As discussed previously, actual sales tax revenues were lower than in 2009, and use taxes decreased The 2010 budget was prepared on a conservative basis due to the closing of two major retailers in 2009, and the expiration of the FEMA grant for ambulance and fire personnel. General government expenditures include all administrative functions of the City (i.e. council, administrator, clerk, judicial, finance, planning, and municipal facilities), as well as public safety, public works, and culture and recreation. The following chart presents a summary of functional categories for expenditures. 23 ---PAGE BREAK--- - 1,000,000 2,000,000 3,000,000 4,000,000 5,000,000 6,000,000 7,000,000 8,000,000 General Government Judicial Public Safety Public Works Culture and Recreation Capital Outlay 2010 Budget & Actual Expenditures by Source - General Fund Budget Actual Operating expenditures were controlled and under budget in all functions except Public Safety. The department added personnel during 2009 and increased salaries in 2010 to be competitive with the surrounding agencies. Capital Assets and Debt Administration Capital Assets: The City of Lafayette’s investment in capital assets for its governmental and business-type activities as of December 31, 2010 amounts to $229.0 million (net of accumulated depreciation). This investment in capital assets includes land, buildings, water and waste water systems, improvements, machinery and equipment, park facilities, roads, storm drainage, and other infrastructure. Major capital asset activity during 2010 (with prior year Work-in-Progress (WIP)) include (in thousands): Developer Dedications- Land & Rights-of-Way $ 430 Infrastructure 1,328 Street Improvements 2,532 Regional Drainage Project 583 Pre-treatment Basin Covers 992 Water Rights 477 Acquisition of Open Space Land 333 24 ---PAGE BREAK--- Capital Assets at Year-End (Net of Depreciation, in thousands) Governmental Business-type Activities Activities Total 2010 2009 2010 2009 2010 2009 Land $ 63,081 $ 62,317 $ 7,663 $ 7,663 $ 70,744 $ 69,980 Water Rights - - 26,325 25,848 26,325 25,848 Buildings and Systems 16,410 16,247 57,901 58,012 74,311 74,259 Improvements other than Buildings 1,376 336 92 93 1,468 429 Infrastructure 47,343 46,513 - - 47,343 46,513 Equipment 3,317 3,601 2,985 3,436 6,302 7,037 Construction in Process 1,362 1,342 1,107 1,983 2,469 3,325 Total $ 132,889 $ 130,356 $ 96,073 $ 97,035 $ 228,962 $ 227,391 Additional information on the City’s capital assets can be found in Note 5 to the Financial Statements. Bonded Debt: At December 31, 2010, the City had total bonded debt outstanding of $39.0 million. Of this amount, $6.4 million consisted of debt backed by the full faith and credit of the City, and the balance of $32.6 million represents bonds secured solely by specified revenue sources (revenue and demand bonds). Additional information on the City’s debt structure is located in Note 6 to the Financial Statements. Outstanding Bond Debt at Year-End General Obligation, Revenue and Demand Bonds (in millions) Governmental Business-type Activities Activities Total 2010 2009 2010 2009 2010 2009 General obligation bonds $ 5.8 $ 6.3 $ 0.6 $ 2.0 $ 6.4 $ 8.3 Revenue bonds 12.7 13.6 15.9 16.0 28.6 29.6 Demand bonds 4.0 4.0 - - 4.0 4.0 Total bonded debt $ 22.5 $ 23.9 $ 16.5 $ 18.0 $ 39.0 $ 41.9 Economic Factors and Next Year’s Budgets and Rates The City of Lafayette is in a strong financial position. At December 31, 2010, fund balance in the General Fund was at $13.3 million. Council’s policy in this area is to maintain the General Fund balance at 25% of budgeted expenditures. In addition, approximately $3.8 million has been assigned for street improvements. 25 ---PAGE BREAK--- Revenues for 2011 were estimated based on the following assumptions:  Water usage will be similar to 2010.  Golf Course revenues are projected to improve substantially from 2010.  No increase in recreation fees to remain competitive with neighboring facilities.  Revenue from sales and use tax returns will decrease  21 residential building permits will be issued.  Property tax collections will approximate 100% of the levy imposed. Debt service mill levies will be adjusted to generate the necessary amounts for principal and interest payments.  Inflation will not exceed  Interest earnings are calculated at 1.5% interest, as a result of previously purchased investments. Based on early 2011 results, General Fund revenues are 6% higher than at the same time in 2010, but sales tax revenues, net of rebates, are down The local economy is still experiencing the affect of the recession. General Fund expenditures are down 7% from the same period in 2010, excluding the $632,451 payoff of a loan. Water Fund metered water sales increased over the same period in 2010, and water tap fees to date in 2011 have increased considerably from 2010. Water Reclamation Fund revenues increased 18% due mostly to a rate increase. Golf Course revenues decreased 29% from the same period in 2010. Contacting the City’s Financial Management This financial report is designed to provide our citizens, taxpayers, customers, investors and creditors with a general overview of the City’s finances and to show the city’s accountability for the funds and assets it receives. If you have questions about this report, or need additional financial information, contact the City of Lafayette Finance Department at 1290 South Public Road, Lafayette, CO 80026. 26 ---PAGE BREAK--- BASIC FINANCIAL STATEMENTS FINANCIAL SECTION 2010 27 ---PAGE BREAK--- Governmental Business-type Activites Activities Total ASSETS Cash and Investments 21,825,277 $ 28,361,126 $ 50,186,403 $ Accrued Interest Receivable 277,099 137,135 414,234 Accounts Receivable (Net of Allowance for Uncollectibles) 2,092,655 546,419 2,639,074 Property Taxes Receivable 5,931,804 - 5,931,804 Prepaid Items 1,222,851 - 1,222,851 Inventory 23,037 63,061 86,098 Notes Receivable 1,196,083 - 1,196,083 Restricted Cash and Investments 2,102,616 1,889,690 3,992,306 Special Assessments Receivable 1,180,571 214,657 1,395,228 Capital Assets (Net of Accumulated Depreciation) Land 63,081,354 7,662,842 70,744,196 Water Rights - 26,324,533 26,324,533 Buildings and Systems 16,409,929 57,900,824 74,310,753 Improvements Other than Buildings 1,375,705 91,694 1,467,399 Infrastructure 47,343,048 - 47,343,048 Equipment 3,317,131 2,985,492 6,302,623 Construction in Progress 1,361,656 1,107,467 2,469,123 Bond Issue Costs, Net of Amortization 352,247 295,749 647,996 Total Assets 169,093,063 127,580,689 296,673,752 LIABILITIES Accounts Payable 1,829,257 207,912 2,037,169 Claims Payable 38,823 - 38,823 Accounts Payable from Restricted Assets 9,381 312 9,693 Accrued Liabilities 281,949 200,588 482,537 Deposits Payable 1,364,669 72,503 1,437,172 Water and Sewer Tap Fees Received in Advance - 337,119 337,119 Deferred Revenues 6,358,900 - 6,358,900 Noncurrent Liabilities Due Within One Year 2,764,944 978,722 3,743,666 Due in More than One Year 22,132,275 21,960,316 44,092,591 Total Liabilities 34,780,198 23,757,472 58,537,670 NET ASSETS Invested in Capital Assets, Net of Related Debt 109,360,087 75,294,653 184,654,740 Restricted for: Capital Projects 2,028,126 - 2,028,126 GID Obligations 2,769,867 - 2,769,867 Endowment Care 46,398 - 46,398 Ambulance and Fire Services 1,669,740 - 1,669,740 Administrator Severance Package 628,626 - 628,626 Grants 76,098 - 76,098 Unrestricted 17,733,923 28,528,564 46,262,487 Total Net Assets 134,312,865 $ 103,823,217 $ 238,136,082 $ The notes to the financial statements are an integral part of this statement. CITY OF LAFAYETTE, COLORADO STATEMENT OF NET ASSETS December 31, 2010 28 ---PAGE BREAK--- Operating Capital Grants Charges for Grants and and Governmental Business-type Functions/Programs Expenses Services Contributions Contributions Activities Activities Total Governmental Activities: General Government 6,911,396 $ 870,398 $ 13,390 $ 62,831 $ (5,964,777) $ - $ (5,964,777) $ Judicial 311,003 973,241 - - 662,238 - 662,238 Public Safety 7,587,907 413,682 279,729 - (6,894,496) - (6,894,496) Public Works 5,466,171 895,057 941,321 2,608,767 (1,021,026) - (1,021,026) Culture and Recreation 5,920,901 1,550,569 122,430 599,179 (3,648,723) - (3,648,723) Interest and Fiscal Charges 1,124,734 - - - (1,124,734) - (1,124,734) Total Governmental Activities 27,322,112 4,702,947 1,356,870 3,270,777 (17,991,518) - (17,991,518) Business-type Activities Water 5,483,318 4,934,602 - 2,265,857 - 1,717,141 1,717,141 Water Reclamation 2,769,695 1,681,557 - 868,023 - (220,115) (220,115) Golf Course 1,633,609 2,031,606 - - - 397,997 397,997 Storm Water 305,638 643,913 - - - 338,275 338,275 Total Business-type Activities 10,192,260 9,291,678 - 3,133,880 - 2,233,298 2,233,298 Total All Activities 37,514,372 $ 13,994,625 $ 1,356,870 $ 6,404,657 $ (17,991,518) 2,233,298 (15,758,220) General Revenues: Property Taxes 6,479,248 - 6,479,248 General Sales & Use Taxes 10,180,788 - 10,180,788 Unrestricted Intergovernmental Revenues 34,688 - 34,688 Franchise Taxes 981,752 - 981,752 Interest 301,530 326,542 628,072 Gain on Sale of Property 42,831 - 42,831 Transfers 1,616,767 (1,616,767) - Special Item - Adjustment of Note Receivable (1,175,000) - (1,175,000) Total General Revenues, Transfers, and Special Item 18,462,604 (1,290,225) 17,172,379 Change in Net Assets 471,086 943,073 1,414,159 Net Assets - Beginning January 1 133,841,779 102,880,144 236,721,923 Net Assets - Ending December 31 134,312,865 $ 103,823,217 $ 238,136,082 $ The notes to the financial statements are an integral part of this statement. Program Revenues Net (Expense) Revenue And Changes in Net Assets CITY OF LAFAYETTE, COLORADO STATEMENT OF ACTIVITIES For the fiscal year ended December 31, 2010 29 ---PAGE BREAK--- Lafayette Urban Other Renewal Capital Governmental General Authority Projects Funds Total ASSETS Cash and Investments 12,977,031 $ 659,665 $ - $ 6,832,655 $ 20,469,351 $ Accrued Interest Receivable 59,779 2,652 9,641 26,188 98,260 Accounts Receivable Net of Allowance for Uncollectables 1,959,126 - 76,728 8,514 2,044,368 Property Taxes Receivable 2,988,742 128,808 - 2,814,254 5,931,804 Prepaid Items 1,043,780 - - - 1,043,780 Inventory 23,037 - - - 23,037 Notes Receivable - 1,196,083 - - 1,196,083 Restricted Cash and Investments 402,526 - 563,192 1,136,898 2,102,616 Special Assessments Receivable 741,171 - - 439,400 1,180,571 Total Assets 20,195,192 $ 1,987,208 $ 649,561 $ 11,257,909 $ 34,089,870 $ LIABILITIES Accounts Payable 1,171,880 $ 5,160 $ - $ 645,130 $ 1,822,170 $ Accounts Payable from Restricted Assets - - 9,381 - 9,381 Deposits Payable 1,165,143 2,000 66,928 75,000 1,309,071 Accrued Liabilities 181,117 - - 4,235 185,352 Deferred Revenues 4,292,523 1,303,808 - 3,253,654 8,849,985 Total Liabilities 6,810,663 1,310,968 76,309 3,978,019 12,175,959 FUND BALANCE Resources Not in Spendable Form Prepaid Items 1,043,780 - - - 1,043,780 Inventory 23,037 - - - 23,037 Cemetery Endowment - - - 46,398 46,398 Restricted Resources Administrator Severance Package 628,626 - - - 628,626 Capital Projects 372,680 43,724 573,252 1,038,470 2,028,126 Grants 76,098 - - - 76,098 Ambulance and Fire Services - - - 1,662,048 1,662,048 GID Debt Service - - - 2,596,790 2,596,790 Committed Resources Public Works Projects 969,057 - - - 969,057 Parks and Recreation 248,322 - - - 248,322 Urban Renewal Projects - 228,516 - - 228,516 CITY OF LAFAYETTE, COLORADO BALANCE SHEET GOVERNMENTAL FUNDS December 31, 2010 30 ---PAGE BREAK--- Lafayette Urban Other Renewal Capital Governmental General Authority Projects Funds Total FUND BALANCE (continued) Assigned Resources Debt Service Payments 875,099 $ - $ - $ 67,594 $ 942,693 $ Salary Increase Impact 352,643 - - - 352,643 Street Improvements 3,800,000 - - - 3,800,000 Urban Renewal Projects - 404,000 - - 404,000 Ambulance and Fire Services - - - 22,076 22,076 GID Maintenance and Other - - - 663,053 663,053 Recreation, Open Space, and Parks - - - 1,183,461 1,183,461 Unassigned 4,995,187 - - - 4,995,187 Total Fund Balance 13,384,529 676,240 573,252 7,279,890 21,913,911 Total Liabilities and Fund Balance 20,195,192 $ 1,987,208 $ 649,561 $ 11,257,909 $ 34,089,870 $ The notes to the financial statements are an integral part of this statement. CITY OF LAFAYETTE, COLORADO BALANCE SHEET GOVERNMENTAL FUNDS December 31, 2010 31 ---PAGE BREAK--- Total Governmental Fund Balances 21,913,911 $ 221,363 1,175,000 132,888,823 352,247 1,018,775 1,283,522 (24,540,776) Net Assets of the Governmental Activities 134,312,865 $ The notes to the financial statements are an integral part of this statement. Some receivables are recorded as deferred revenue in governmental funds since they are not available for current period expenses. Internal service funds are used by management to charge the costs of insurance and compensated absences to individual funds. The assets and liabilities of the internal service funds are included in governmental activities in the Statement of Net Assets. Amounts reported for governmental activities in the Statement of Net Assets are different because: Some receivables recorded on the Statement of Net Assets include deferred building permit fees and interest accrued on special assessments. These items are not available, and are not recognized in governmental funds. Long-term liabilities, including bonds payable, are not due and payable in the current period and therefore are not reported in the funds. Notes Receivable includes a note for reimbursement from a redeveloper reported as deferred revenue in the funds. This transaction is not recognized as deferred revenue in the government-wide Statement of Net Assets. December 31, 2010 CITY OF LAFAYETTE, COLORADO RECONCILIATION OF THE GOVERNMENTAL FUNDS BALANCE SHEET TO THE GOVERNMENT WIDE STATEMENT OF NET ASSETS Capital assets used in governmental activities are not financial resources and therefore are not reported in the funds. This amount is net of accumulated depreciation of $46,031,121. Other long-term assets (bond issue costs) are reported as current period expenditures during the period incurred in the funds. The costs are deferred, net of amortization, in the government-wide Statement of Net Assets. 32 ---PAGE BREAK--- Lafayette Urban Other Renewal Capital Governmental General Authority Projects Funds Total Revenues Taxes 10,827,440 $ 183,511 $ - $ 5,654,385 $ 16,665,336 $ Licenses and Permits 377,013 - - - 377,013 Intergovernmental 1,516,441 - - 221,666 1,738,107 Fines and Forfeitures 973,241 - - - 973,241 Franchise Taxes 981,752 - - - 981,752 Special Assessments Principal 48,499 - - - 48,499 Special Assessments Interest 3,736 - - 495,878 499,614 Interest 147,027 7,676 31,001 80,642 266,346 Sidewalk Maintenance/Repair 89,439 - - - 89,439 PEG Fees 29,854 - - - 29,854 Public Art Fees 1,645 - - - 1,645 Contributions and Misc Grants 108,027 - - 11,200 119,227 Charges for Services 3,489,277 - - 15,000 3,504,277 Miscellaneous 46,681 10,000 145,274 47,386 249,341 Total Revenues 18,640,072 201,187 176,275 6,526,157 25,543,691 Expenditures Current General Government 5,743,999 92,113 - 874,266 6,710,378 Judicial 310,795 - - - 310,795 Public Safety 6,703,195 - - 250,703 6,953,898 Public Works 2,081,841 - 734,630 5,315 2,821,786 Culture and Recreation 4,798,447 - - 87,737 4,886,184 Capital Outlay 1,693,809 - 2,540,310 1,033,027 5,267,146 Debt Service Capital Lease and Loan Payments - - - 539,659 539,659 Bond Principal - - - 1,445,000 1,445,000 Bond Interest and Fiscal Charges - - - 988,157 988,157 Total Expenditures 21,332,086 92,113 3,274,940 5,223,864 29,923,003 Excess (Deficiency) of Revenues Over Expenditures (2,692,014) 109,074 (3,098,665) 1,302,293 (4,379,312) Other Financing Sources (Uses) Transfers In 2,812,110 - - 539,659 3,351,769 Transfers (Out) (539,659) (47,674) (36,733) (1,110,936) (1,735,002) Total Other Financing Sources (Uses) 2,272,451 (47,674) (36,733) (571,277) 1,616,767 GOVERNMENTAL FUNDS CITY OF LAFAYETTE, COLORADO STATEMENT OF REVENUES, EXPENDITURES, AND CHANGES IN FUND BALANCES For the fiscal year ended December 31, 2010 33 ---PAGE BREAK--- Lafayette Urban Other Renewal Capital Governmental General Authority Projects Funds Total Net Change in Fund Balance (419,563) $ 61,400 $ (3,135,398) $ 731,016 $ (2,762,545) $ Fund Balance, January 1 13,804,092 614,840 3,708,650 6,548,874 24,676,456 Fund Balance, December 31 13,384,529 $ 676,240 $ 573,252 $ 7,279,890 $ 21,913,911 $ The notes to the financial statements are an integral part of this statement. For the fiscal year ended December 31, 2010 STATEMENT OF REVENUES, EXPENDITURES, AND CHANGES IN FUND BALANCES CITY OF LAFAYETTE, COLORADO STATEMENT OF REVENUES, EXPENDITURES, AND CHANGES IN FUND BALANCES CITY OF LAFAYETTE, COLORADO GOVERNMENTAL FUNDS 34 ---PAGE BREAK--- Amounts reported for governmental activities in the Statement of Activities are different because: (2,762,545) $ 2,532,188 1,880,415 (1,041,387) (66,645) (121,645) 50,705 471,086 $ The notes to the financial statements are an integral part of this statement. TO THE STATEMENT OF ACTIVITIES Change in net assets of governmental activities Net change in fund balances - total government funds Governmental Funds report deferred revenues as income when received. Events in 2010 caused a reduction in net assets by the write down of a long-term note receivable ($1,175,000) and reversal of prior year ambulance billings $(93,063). This amount represents the net effect of the reduction after offsets by special asessments billings of $204,487 and cemetery preneed costs of $22,189. Some income reported in the Statement of Activities, although measurable, is not available, and is not reported as revenue in governmental funds. Internal service funds are used by management to charge the costs of insurance and employee benefits to individual funds. The net revenue (expenditures) of the 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. Debt proceeds provide current financial resources to governmental funds, but issuing debt increases long-term liabilities in the Statement of Net Assets. Repayment of debt principal is an expenditure in the governmental funds, but the repayment reduces long-term liabilities in the statement of net assets. This amount is the net effect of these differences in the treatment of long-term debt and related items. Governmental funds report capital outlays as expenditures. However, in the Statement of Activities the cost of those assets is allocated over their estimated useful lives and reported as depreciation expense. This is the amount by which capital outlays of $5,267,147, and developer dedications of $1,757,927, exceeded depreciation $(4,468,651), retirements net of accumulated depreciation $(24,235) in the current period. CITY OF LAFAYETTE, COLORADO RECONCILIATION OF THE STATEMENT OF REVENUES, EXPENDITURES, AND CHANGES IN FUND BALANCES OF GOVERNMENTAL FUNDS For the fiscal year ended December 31, 2010 35 ---PAGE BREAK--- Nonmajor Governmental Water Proprietary Activities - Water Reclamation Golf Storm Internal Utility Utility Course Water Total Service Funds Assets Current Assets Cash and Investments 23,633,661 $ 3,070,858 $ 159,086 $ 1,497,521 $ 28,361,126 $ 1,355,927 $ Accrued Interest Receivable 115,142 13,909 841 7,243 137,135 5,762 Accounts Receivable 281,475 198,911 - 66,033 546,419 - Prepaid Items - - - - - 179,071 Inventory - - 63,061 - 63,061 - Restricted Cash and Investments 1,889,690 - - - 1,889,690 - Total Current Assets 25,919,968 3,283,678 222,988 1,570,797 30,997,431 1,540,760 Noncurrent Assets Assessments Receivable - 214,657 - - 214,657 - Bond Issue Costs, Net of Amortization 259,947 35,802 - - 295,749 - Capital Assets Water, Water Reclamation, and Storm Water System 50,013,779 31,101,139 - 24,325 81,139,243 - Buildings and Improvements 1,180,169 291,039 1,320,916 - 2,792,124 - Improvements Other than Buildings - - 410,720 12,315 423,035 - Equipment 5,977,546 2,654,712 1,126,591 284,906 10,043,755 - Accumulated Depreciation (20,324,052) (11,235,817) (1,827,281) (32,997) (33,420,147) - Total Plant and Equipment, Net of Accumulated Depreciation 36,847,442 22,811,073 1,030,946 288,549 60,978,010 - Land 6,946,286 716,556 - - 7,662,842 - Water Rights 26,324,533 - - - 26,324,533 - Construction in Progress 763,220 31,337 - 312,910 1,107,467 - Total Capital Assets, Net of Accumulated Depreciation 70,881,481 23,558,966 1,030,946 601,459 96,072,852 - Total Noncurrent Assets 71,141,428 23,809,425 1,030,946 601,459 96,583,258 - Total Assets 97,061,396 $ 27,093,103 $ 1,253,934 $ 2,172,256 $ 127,580,689 $ 1,540,760 $ CITY OF LAFAYETTE, COLORADO STATEMENT OF NET ASSETS PROPRIETARY FUNDS December 31, 2010 36 ---PAGE BREAK--- Nonmajor Governmental Water Proprietary Activities - Water Reclamation Golf Storm Internal Utility Utility Course Water Total Service Funds Current Liabilities Accounts Payable 129,955 $ 36,956 $ 6,653 $ 34,348 $ 207,912 $ 7,087 $ Accounts Payable from Restricted Assets 312 - - - 312 - Deposits Payable 15,000 - 57,503 - 72,503 - Claims Payable - - - - - 38,823 Accrued Liabilities Accrued Interest Payable 69,805 75,282 - - 145,087 - Accrued Payroll 25,706 17,069 10,034 2,692 55,501 - Water and Sewer Tap Fees Received in Advance 236,770 100,349 - - 337,119 - Current Portion of Long-Term Debt 399,978 479,634 90,729 8,381 978,722 476,075 Total Current Liabilities 877,526 709,290 164,919 45,421 1,797,156 521,985 Noncurrent Liabilities Long-Term Obligations 16,313,365 5,436,539 204,268 6,144 21,960,316 - Total Noncurrent Liabilities 16,313,365 5,436,539 204,268 6,144 21,960,316 - Total Liabilities 17,190,891 6,145,829 369,187 51,565 23,757,472 521,985 Net Assets Invested in Capital Assets, Net of Related Debt 56,171,815 17,722,932 798,447 601,459 75,294,653 - Unrestricted 23,698,690 3,224,342 86,300 1,519,232 28,528,564 1,018,775 Total Net Assets 79,870,505 $ 20,947,274 $ 884,747 $ 2,120,691 $ 103,823,217 $ 1,018,775 $ The notes to the financial statements are an integral part of this statement. CITY OF LAFAYETTE, COLORADO STATEMENT OF NET ASSETS PROPRIETARY FUNDS December 31, 2010 37 ---PAGE BREAK--- Nonmajor Governmental Water Proprietary Activities - Water Reclamation Golf Storm Internal Utility Utility Course Water Total Service Funds Operating Revenues Charges for Services Metered Water Sales 4,869,976 $ - $ - $ - $ 4,869,976 $ - $ Waste Water Collection Fees - 1,681,557 - - 1,681,557 - Storm Water Collection Fees - - - 612,963 612,963 - Golf Sales and Services - - 2,022,680 - 2,022,680 - Miscellaneous Services - - - - - 2,468,085 Other 64,626 - 8,926 - 73,552 153,093 Total Operating Revenues 4,934,602 1,681,557 2,031,606 612,963 9,260,728 2,621,178 Operating Expenses Administration 373,443 185,977 145,232 62,502 767,154 - Source of Water Supply 329,879 - - - 329,879 - Water Treatment 1,592,585 - - - 1,592,585 - Water Transmission and Distribution 701,959 - - - 701,959 - Waste Water Treatment - 1,038,897 - - 1,038,897 - Waste Water Collection - 473,312 - - 473,312 - Golf Maintenance Operations - - 633,320 - 633,320 - Golf Club House Operations - - 467,641 - 467,641 - Golf Food Service Operations - - 197,791 - 197,791 - Storm Water Collection - - - 212,163 212,163 - Premiums and Claims Paid - - - - - 2,440,366 Miscellaneous - - - - - 141,734 Depreciation 1,576,530 857,666 173,453 30,973 2,638,622 - Amortization 40,416 3,255 - - 43,671 - Total Operating Expenses 4,614,812 2,559,107 1,617,437 305,638 9,096,994 2,582,100 Operating Income (Loss) 319,790 (877,550) 414,169 307,325 163,734 39,078 Non-operating Revenues (Expenses) Interest Revenue 263,002 44,065 1,742 17,733 326,542 11,627 Interest Expense (863,631) (210,390) (16,172) - (1,090,193) - Bond Fees (4,875) - - - (4,875) - Net Loss on Disposal of Capital Assets - (198) - - (198) - Total Non-operating Revenues (Expenses) (605,504) (166,523) (14,430) 17,733 (768,724) 11,627 Net Income (Loss) Before Contributions and Transfers (285,714) (1,044,073) 399,739 325,058 (604,990) 50,705 CITY OF LAFAYETTE, COLORADO STATEMENT OF REVENUES, EXPENSES, AND CHANGES IN FUND NET ASSETS PROPRIETARY FUNDS For the Fiscal Year Ended December 31, 2010 38 ---PAGE BREAK--- Nonmajor Governmental Water Proprietary Activities - Water Reclamation Golf Storm Internal Utility Utility Course Water Total Service Funds Capital Contributions Tap Fees 1,573,542 $ 868,023 $ - $ - $ 2,441,565 $ - $ Storm Water Development Fees - - - 30,950 30,950 - Payments in Lieu of Water 496,315 - - - 496,315 - Developer Dedications 196,000 - - - 196,000 - Transfers Transfers Out (727,477) (262,767) (560,358) (66,165) (1,616,767) - Total Contributions and Transfers 1,538,380 605,256 (560,358) (35,215) 1,548,063 - Change in Net Assets 1,252,666 (438,817) (160,619) 289,843 943,073 50,705 Total Net Assets, January 1 78,617,839 21,386,091 1,045,366 1,830,848 102,880,144 968,070 Total Net Assets, December 31 79,870,505 $ 20,947,274 $ 884,747 $ 2,120,691 $ 103,823,217 $ 1,018,775 $ The notes to the financial statements are an integral part of this statement. PROPRIETARY FUNDS For the Fiscal Year Ended December 31, 2010 CITY OF LAFAYETTE, COLORADO STATEMENT OF REVENUES, EXPENSES, AND CHANGES IN FUND NET ASSETS 39 ---PAGE BREAK--- Non-Major Governmental Water Proprietary Activities - Reclamation Golf Storm Internal Water Utility Course Water Total Service Funds Cash Flows From Operating Activities Receipts From Customers and Users 4,920,931 $ 1,644,320 $ 2,050,797 $ 633,229 $ 9,249,277 $ 153,093 $ Receipts from Interfund Services Provided - - - - - 2,468,085 Payments to Suppliers (1,426,625) (670,669) (546,407) (98,308) (2,742,009) (2,459,892) Payments to Employees (1,197,390) (784,674) (779,075) (110,938) (2,872,077) (134,604) Payment for Interfund Services Used (369,632) (220,525) (114,533) (32,430) (737,120) - Net Cash Provided (Used) by Operating Activities 1,927,284 (31,548) 610,782 391,553 2,898,071 26,682 Cash Flows from Noncapital Financing Activities Transfers to Other Funds (727,477) (262,767) (560,358) (66,165) (1,616,767) - Net Cash Used by Noncapital Transfers (727,477) (262,767) (560,358) (66,165) (1,616,767) - Cash Flows from Capital and Related Financing Activities Payment in Lieu of Water 496,315 - - - 496,315 - Tap Fees 980,306 483,858 - - 1,464,164 - Acquisition & Construction of Capital Assets (1,131,069) (126,251) (23,134) (499,550) (1,780,004) - Bond Fees (4,875) - - - (4,875) - Principal Paid on Capital Debt (1,468,229) (416,582) (76,051) - (1,960,862) - Interest Paid on Capital Debt (849,629) (233,935) (16,172) - (1,099,736) - Net Cash (Used) by Capital and Related Financing Activities (1,977,181) (292,910) (115,357) (499,550) (2,884,998) - Cash Flows from Investing Activities Interest Received 301,134 50,159 4,028 20,436 375,757 13,352 Net Cash Provided by Investing Activities 301,134 50,159 4,028 20,436 375,757 13,352 Net Increase (Decrease) in Cash and Investments (476,240) (537,066) (60,905) (153,726) (1,227,937) 40,034 Cash and Investments, January 1 25,999,591 3,607,924 219,991 1,651,247 31,478,753 1,315,893 Cash and Investments, December 31, Including $1,889,690 Reported in Restricted Accounts for the Water Fund 25,523,351 $ 3,070,858 $ 159,086 $ 1,497,521 $ 30,250,816 $ 1,355,927 $ CITY OF LAFAYETTE, COLORADO STATEMENT OF CASH FLOWS PROPRIETARY FUNDS For the fiscal year Ended December 31, 2010 40 ---PAGE BREAK--- Non-Major Governmental Water Proprietary Activities - Reclamation Golf Storm Internal Water Utility Course Water Total Service Funds CITY OF LAFAYETTE, COLORADO STATEMENT OF CASH FLOWS PROPRIETARY FUNDS For the fiscal year Ended December 31, 2010 Reconciliation of Operating Income (Loss) to Net Cash Provided (Used) by Operating Activities Operating Income (Loss) 319,790 $ (877,550) $ 414,169 $ 338,275 $ 194,684 $ 39,078 $ Adjustments to Reconcile Operating Income to Net Cash Provided by Operating Activities Depreciation Expense 1,576,530 857,666 173,453 30,973 2,638,622 - Amortization Expense 40,416 3,255 - - 43,671 - (Increase) Decrease in Accounts Receivable (28,671) (37,237) - (10,684) (76,592) 745 (Increase) Decrease in Prepaid Items - 17,405 - - 17,405 (18,875) Decrease in Inventories - - 6,077 - 6,077 - Increase (Decrease) in Accounts Payable 17,175 (6,880) 13,062 26,536 49,893 14,437 Increase (Decrease) in Accrued Payroll 4,176 6,321 2,572 1,182 14,251 - Increase (Decrease) in Compensated Absences (2,132) 5,472 1,449 5,271 10,060 (8,703) Total Adjustments 1,607,494 846,002 196,613 53,278 2,703,387 (12,396) Net Cash Provided by Operating Activities 1,927,284 $ (31,548) $ 610,782 $ 391,553 $ 2,898,071 $ 26,682 $ Non-Cash Capital Financing Activities: Capital Assets Acquired Through Developer Dedications 196,000 $ - $ - $ - $ 196,000 $ - $ 196,000 $ - $ - $ - $ 196,000 $ - $ The notes to the financial statements are an integral part of this statement. 41 ---PAGE BREAK--- NOTES TO THE FINANCIAL STATEMENTS FINANCIAL SECTION 2010 42 ---PAGE BREAK--- CITY OF LAFAYETTE, COLORADO COMPREHENSIVE ANNUAL FINANCIAL REPORT INDEX FOR NOTES TO THE FINANCIAL STATEMENTS For the Fiscal Year Ended December 31, 2010 NOTE 1: Summary of significant accounting policies A. Reporting entity 45 B. Government-wide and fund financial statements 46 C. Measurement focus, basis of accounting, and financial statement presentation 46 D. Cash equivalents 49 E. Investments 49 F. Interfund receivables/payables 49 G. Property taxes receivable 49 H. Inventories 50 I. Long-term obligations 50 J. Capital 51 K. Accrual for compensated absences 51 L. Fund balance/Net assets 52 M. Special assessments. 53 NOTE 2: Reconciliation of government-wide and fund financial statements A. Explanation of certain differences between the government fund balance sheet and the government-wide statement of net assets 53 B. Explanation of certain differences between the governmental fund statement of revenues, expenditures, and changes in fund balances and the government-wide statement of activities 54 NOTE 3: Cash deposits and investments A. Deposits 56 B. Investments 56 NOTE 4: Restricted cash and investments 58 NOTE 5: Capital assets 60 NOTE 6: Long-term debt A. Bonded Debt 61 B. Notes Payable 65 C. Pledged Revenues 66 D. Capital Leases 69 E. Changes in Long-term Liabilities 70 NOTE 7: Amendment one 70 NOTE 8: Interfund Transfers 71 43 ---PAGE BREAK--- NOTE 9: Employee retirement plans A. General Employees 71 B. Commissioned Police Officers, Firefighters, and Ambulance Personnel 72 C. Volunteer Firefighters 74 NOTE 10: Risk management 75 NOTE 11: Special Item 76 NOTE 12: Conduit Debt 77 NOTE 13: Commitments and Contingencies 77 NOTE 14: Pending Litigation 77 44 ---PAGE BREAK--- CITY OF LAFAYETTE, COLORADO NOTES TO THE FINANCIAL STATEMENTS December 31, 2010 NOTE 1 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES The City was founded in 1888 and incorporated in 1889. On April 1, 1958 citizens voted to become a Home Rule City, as authorized by Article 20 of the Colorado State Constitution. The City operates under a Strong Council/Administrator form of government and provides the following services as authorized by its charter: administration, finance, planning, library, building maintenance, municipal court, city attorney, police, career and volunteer fire, ambulance, highway and street maintenance, parks and recreation, debt service, water, sanitary sewer, storm water and golf course services. The accompanying financial statements have been prepared in accordance with generally accepted accounting principles applicable to governments. A summary of the City’s significant accounting policies applied in the preparation of these financial statements follows: A. Reporting Entity The definition of the financial reporting entity is based upon the concept that elected officials are accountable to their constituents for their actions. One of the objectives of financial reporting is to provide users of financial statements with a basis for assessing the accountability of the elected officials. The financial reporting entity consists of the primary government, organizations for which the primary government is financially accountable and other organizations for which the nature and significance of their relationship with the primary government are such that exclusion would cause the reporting entity’s financial statements to be misleading or incomplete. The City is financially accountable for legally separate organizations if City officials appoint a voting majority of the organization’s governing board and either it is able to impose its will on that organization or there is a potential for the organization to provide specific financial benefits to, or to impose specific financial burdens on the City. The City may also be financially accountable for organizations that are fiscally dependent on it. Based upon the application of these criteria, the City has identified six blended component units presented as special revenue funds. They are the Lafayette Urban Renewal Authority, Lafayette City Center GID, Exempla GID, Lafayette Corporate Campus GID, Lafayette Tech Center GID, and St. James GID (inactive). The Lafayette City Council acts as the governing board for each of the component units. Separate financial statements are not issued for these component units. 45 ---PAGE BREAK--- CITY OF LAFAYETTE, COLORADO NOTES TO THE FINANCIAL STATEMENTS December 31, 2010 NOTE 1 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued) B. Government-wide and Fund Financial Statements The government-wide financial statements the statement of net assets and the statement of activities) report information on all activities of the primary government and its component units. For the most part, the effect of inter-fund 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. The statement of activities demonstrates the degree to which the direct expenses of a given function or segment are 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 and proprietary funds. Major individual governmental funds and major individual enterprise funds are reported as separate columns in the fund financial statements. C. Measurement Focus, Basis of Accounting, and Financial Statement Presentation The government-wide financial statements are reported using the economic resources measurement focus and the accrual basis of accounting, as are the proprietary funds. 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. Governmental fund financial statements are reported using the current financial resources measurement focus and the 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 claims and judgments, are recorded only when payment is due. 46 ---PAGE BREAK--- CITY OF LAFAYETTE, COLORADO NOTES TO THE FINANCIAL STATEMENTS December 31, 2010 NOTE 1 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued) C. Measurement Focus, Basis of Accounting, and Financial Statement Presentation (continued) Taxes, licenses, intergovernmental revenues, 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 City. 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 Lafayette Urban Renewal Authority accounts for incremental sales and property tax revenues and related expenses identified for urban renewal in a specific geographical area.  The Capital Projects Fund accounts for construction activities related to roads and street projects. 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. The principal operating revenues of the Water Fund, Water Reclamation Fund, Storm Water Fund, and Golf Course Fund are charges to customers for sales and services. The Water Fund and Water Reclamation Fund also recognize as operating revenue the portion of tap fees intended to recover the cost of connecting new customers to the system. Operating expenses for enterprise funds and internal service funds include the 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. The City reports the following major proprietary funds:  The Water Fund accounts for the treatment and distribution of the City’s water supply.  The Water Reclamation Fund accounts for the operation of the City’s sewer system.  The Golf Course Fund accounts for the operations of the municipal golf course. 47 ---PAGE BREAK--- CITY OF LAFAYETTE, COLORADO NOTES TO THE FINANCIAL STATEMENTS December 31, 2010 NOTE 1 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued) C. Measurement Focus, Basis of Accounting, and Financial Statement Presentation (continued) Additionally, the City reports the following fund types:  Special revenue funds used to account for the proceeds of specific revenue sources (other than expendable trusts or major capital projects) that are legally restricted to expenditures for specified purposes. This category includes the Ambulance and Fire Fund, Lafayette City Center GID, Lafayette Corporate Campus GID, Exempla GID, Lafayette Tech Center GID, and St. James GID (inactive). The Ambulance and Fire Fund’s revenue source is an additional 4.5 mill levy on property taxes. These funds are specifically to provide additional fire department personnel and capital expenditures such as new fire equipment. The Lafayette City Center GID, Lafayette Corporate Campus GID, and the Lafayette Tech Center GID are all funded with property and specific ownership tax dollars. The purpose of these GIDs is to pay debt service related to the improvements for these districts. The Exempla GID’s revenue source is a special assessment on typically non-taxable property in addition to property and specific ownership tax. The funds are used to pay debt service for infrastructure improvements within the district.  Capital project funds used for specific acquisition or construction activities such as: Storm Drainage Fund, Legacy Open Space Fund, Parks, Open Space, and Trails Fund, and the Conservation Trust Fund.  The Debt Service Fund is used to account for the accumulation of resources for and the payment of long-term obligation principal, interest and related costs (other than proprietary fund debt).  Internal Service Funds are used to account for the financing of goods or services provided by one department to other departments of the City on a cost reimbursement basis. These funds are used to account for the operations of the Employee Benefit Fund and the Insurance Fund, which are administered by the City.  The Storm Water Enterprise Fund imposes fees on improved properties and developments to fund storm water quality issues and improvements; and the operation, maintenance, construction, improvement and replacement of storm water utility facilities.  Cemetery Endowment Fund is a Permanent Fund established to separately account for an endowment care trust that occurred prior to the City acquiring ownership in the Coal Creek Cemetery. The earnings on the principal in the trust are spendable, but not the principal amount. As a general rule, the effect of inter-fund activity has been eliminated from the government- wide financial statements. Exceptions to this general rule are charges between the City’s water, sewer, storm water, and golf course functions. Elimination of these charges would distort the direct costs and program revenues reported for the various functions concerned. 48 ---PAGE BREAK--- CITY OF LAFAYETTE, COLORADO NOTES TO THE FINANCIAL STATEMENTS December 31, 2010 NOTE 1 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued) C. Measurement Focus, Basis of Accounting, and Financial Statement Presentation (continued) When both restricted and unrestricted resources are available for use, it is the City’s practice to use restricted resources first, then unrestricted resources as they are needed. D. Cash Equivalents The City considers cash deposits and highly liquid investments (including restricted assets) with a maturity of three months or less when purchased, to be cash equivalents. All of the City’s proprietary fund investments are considered cash equivalents for purposes of the statement of cash flows. E. Investments Cash and investments, except for proceeds of bond issues accounted for in the appropriate funds, are pooled throughout the year into an Agency Fund (central cash) for cash management purposes. Investment income is allocated to the individual funds based on the average balance for the month. Should any of these funds have an average deficit in the pool, they are charged interest accordingly. All investments are stated at fair value. For financial statement purposes, the cash and investment amounts are reported as “cash and investments” of the respective individual funds at year-end. F. Inter-fund Receivables/Payables Transactions between funds that are representative of lending/borrowing arrangements outstanding at the end of the fiscal year are referred to as either “inter-fund receivables/payables” (i.e. the current portion of inter-fund loans) or “advances to/from other funds (i.e. the non-current portion of inter-fund loans). Any residual balances outstanding between the governmental activities and business-type activities are reported in the government-wide financial statements as “internal balances.” G. Property Taxes Receivable Property taxes are not due and payable until after the assessment year has ended. Property taxes are initially recorded as deferred revenue in the year they are earned and measurable. The deferred property tax is recorded as revenue in the year it is available or collected. 49 ---PAGE BREAK--- CITY OF LAFAYETTE, COLORADO NOTES TO THE FINANCIAL STATEMENTS December 31, 2010 NOTE 1 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued) G. Property Taxes Receivable (continued) Property taxes are collected and remitted to the City by Boulder County, Colorado. The property tax calendar is detailed below: Lien date January 1 City certifies mill levies to County December 15 Levy date January 1 Collection/due dates: Total April 30 First half February 28 Second half June 15 Delinquent notices August 15 Tax Sale Mid-November H. Inventories Inventories of a material amount are only maintained in the General Fund for fuel and the Golf Course Fund for clubhouse merchandise. These inventories are valued at cost, using the first-in/first-out (FIFO) method. The costs of these inventories are recorded as expenditures or expenses when consumed rather than when purchased. All other inventories in the City are considered immaterial and are expensed when purchased. I. 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 assets. Bond premiums and discounts, as well as issuance costs, are deferred and amortized over the life of the bonds using the straight-line method. In the fund financial statements, governmental fund types recognize the face amount of debt issued 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. Certain revenue is allocated each year to the Debt Service Fund to provide for the full amount estimated to be required for debt service on certain general obligation bonds, revenue bonds, and capital leases. Debt service for the Water and Water Reclamation Utility Funds and the Golf Course Fund is paid from monies provided by those funds. 50 ---PAGE BREAK--- CITY OF LAFAYETTE, COLORADO NOTES TO THE FINANCIAL STATEMENTS December 31, 2010 NOTE 1 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued) J. Capital Assets All capital assets, including “Public Domain” capital assets such as streets and sidewalks are reported in the applicable governmental or business-type activities columns in the government-wide financial statements. Capital assets are defined by the City as assets with liabilities an individual cost of more than $5,000 and an estimated useful life in excess of one year. Capital assets are reported at original cost. Donated assets are valued at the fair market value on the date donated. Costs incurred for the purchase or construction of capital assets for governmental activities are recorded as capital outlay expenditures in the governmental funds. Infrastructure assets include streets, sidewalks, trails, traffic signals and similar items. Costs incurred for the purchase or construction of capital assets for business-type activities are reported as assets in the proprietary funds. Interest is capitalized on proprietary fund assets acquired with tax exempt debt. Depreciation of all exhaustible capital assets is charged as an expense against operations. Accumulated depreciation is reported on the government-wide financial statements and the proprietary fund types in the fund financials. Depreciation has been provided over the estimated useful lives using the straight-line method. The estimated useful lives are as follows: Buildings 50 years Improvements Other Than Buildings 10 - 25 years Equipment 5 - 10 years Water and Water Reclamation Systems 50 years Infrastructure 30 - 50 years K. Compensated Absences The City has a policy that allows employees to accumulate unused vacation and sick benefits up to certain maximum hours. Unused vacation and sick leave is paid at separation of employment. Compensated absences are recognized when earned in proprietary fund types and when paid in governmental fund types. A liability for these amounts is reported in the government-wide financial statements. In the past, payments to liquidate the liability have been made through the General, Water, Water Reclamation, Storm Water, and Golf Course Funds. 51 ---PAGE BREAK--- CITY OF LAFAYETTE, COLORADO NOTES TO THE FINANCIAL STATEMENTS December 31, 2010 NOTE 1 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued) L. Fund Balance/Net Assets In the fund financial statements, governmental funds report fund balances based on the level of spending constraints placed on the City. Fund balances may be classified as nonspendable, restricted, committed, assigned, or unassigned. The nonspendable fund balance classification includes amounts that cannot be spent because they are either not in spendable form, or legally or contractually required to be maintained intact. Inventories and prepaid amounts are examples of this classification. Spending constraints that are placed on the use of fund balance amounts by creditors, grantors, contributors, laws or regulations of other governments, or imposed by law through constitutional provisions or enabling legislation, are classified as restricted. Committed fund balances are created by the City Council either by resolution or ordinance. These amounts can only be used for specific purposes pursuant to the formal action by the Council. The purposes can change only by Council authority by the appropriate action as mentioned above. Assigned fund balances occur on the intention, as opposed to formal action, of a specific use. Intent may be expressed by the City Administrator. The Council delegates the authority to the City Administrator. All of the above classifications will not apply to every governmental fund. Each classification depicts the net resources that are reported in each fund. Unassigned fund balance is the remaining fund balance in the General Fund after amounts that are set aside for the higher classifications. This designation is only applicable to the General Fund. Since 1988, the City of Lafayette’s financial policy requires the “unassigned” General Fund balance to be maintained at 25% of budgeted expenditures for each year. The financial policy was established by Council resolution. In addition, in 1992, the Taxpayer’s Bill of Rights (TABOR) was adopted as a constitutional amendment in the State of Colorado, effective in 1993. One of the provisions, which apparently is absolute, requires each municipality to set aside an emergency reserve of 3% of its fiscal year spending. The City of Lafayette has taken the position that the TABOR reserve is included in the reserve required by its financial policies established earlier. In any event, neither reserve requirement provides details regarding the circumstances under which the reserves may be spent. Therefore, the reserves do not meet the criteria to be classified as restricted or committed, and will be classified as unassigned. At December 31, 2010, the amount available for extraordinary or emergency purposes is $4,995,187. 52 ---PAGE BREAK--- CITY OF LAFAYETTE, COLORADO NOTES TO THE FINANCIAL STATEMENTS December 31, 2010 NOTE 1 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued) L. Fund Balance/Net Assets (continued) The transition from governmental fund financial statements to the government-wide Statement of Net Assets requires the five governmental classifications to be identified as restricted or unrestricted. Restricted net assets include net assets that are subject to restrictions beyond the City’s control. Therefore, amounts reported in the restricted classifications in the governmental funds may differ. All other governmental classifications will fall under the category of unrestricted for the Statement of Net Assets. When both restricted and unrestricted fund balance is available for use, the City will use the restricted amounts before the unrestricted amounts. The City of Lafayette has not established a formal policy for its use of unrestricted fund balance amounts. However, if expenditures are incurred for which any unrestricted fund balance could be used, committed amounts would be reduced first, followed by assigned amounts, and finally, by unassigned amounts. M. Special Assessments Special assessments are recorded in governmental funds as revenue in the year that the assessments become available. This results in recognizing revenue only in the amount of assessment installments, as they are collected. The remaining assessed but uncollected installments are recorded as deferred revenue. The City has not reflected the special assessment interest as revenue or as a receivable at December 31, 2010, as such amounts are not considered currently available. Collection of delinquent interest is recorded as revenue when received. NOTE 2 RECONCILIATION OF GOVERNMENT-WIDE AND FUND FINANCIAL STATEMENTS A. Explanation of certain differences between the government fund balance sheet and the government-wide statement of net assets The governmental fund balance sheet includes a reconciliation between fund balance-total governmental funds and net assets-governmental activities as reported in the government- wide statement of net assets. One element of that reconciliation explains that “some receivables are recorded as deferred revenue in governmental funds since they are not 53 ---PAGE BREAK--- CITY OF LAFAYETTE, COLORADO NOTES TO THE FINANCIAL STATEMENTS December 31, 2010 NOTE 2 RECONCILIATION OF GOVERNMENT-WIDE AND FUND FINANCIAL STATEMENTS (continued) A. Explanation of certain differences between the government fund balance sheet and the government-wide statement of net assets (continued) available for current period expenditures.” The details of this $1,283,522 difference are as follows: Special Assessments $ 1,180,571 Cemetery Endowment Care Earnings 2,196 Ambulance Accounts Receivable 100,755 Net adjustment to reduce fund balance – total governmental funds to arrive at net assets – governmental activities $ 1,283,522 A second element of that reconciliation states that “long-term liabilities, including bonds payable, are not due and payable in the current period and therefore are not reported in the funds.” The details of this $(24,540,776) difference are as follows: Bonds Payable $ (22,420,000) Unamortized Debt Premium (11,842) Unamortized Charges - Refunding Bonds 444,201 Note Payable to Heritage Bank (647,492) Accrued Interest Payable (96,597) Capital Leases (1,380,486) Preneed Cemetery Claims (23,035) Compensated Absences (881,600) Less amount included in Assets and Liabilities of Internal Service Funds 476,075 Net adjustment to reduce fund balance - total governmental funds to arrive at net assets - governmental activities $ (24,540,776) B. Explanation of certain differences between the governmental fund statement of revenues, expenditures, and changes in fund balances and the government-wide statement of activities The governmental fund statement of revenues, expenditures, and changes in fund balances includes reconciliation between net changes in fund balances-total governmental funds and changes in net assets of governmental activities as reported in the government-wide statement of activities. One element of that reconciliation states that “debt proceeds provide current financial resources to governmental funds, but issuing debt increases long-term liabilities in the statement of net assets. Repayment of debt principal is an expenditure in the governmental funds, but the repayment reduces long-term liabilities in the statement of net 54 ---PAGE BREAK--- CITY OF LAFAYETTE, COLORADO NOTES TO THE FINANCIAL STATEMENTS December 31, 2010 NOTE 2 RECONCILIATION OF GOVERNMENT-WIDE AND FUND FINANCIAL STATEMENTS (continued) B. Explanation of certain differences between the governmental fund statement of revenues, expenditures, and changes in fund balances and the government-wide statement of activities (continued) assets.” The details of this $1,880,415 difference are as follows: Principal Payments: Bond 1,445,000 Capital lease 393,899 Note Payable 41,516 Net adjustment to increase net changes in fund balances-total governmental funds to arrive at changes in net assets of governmental activities $ 1,880,415 A second element of that reconciliation states that “Some income reported in the Statement of Activities, although measurable, is not available, and is not reported as revenue in governmental funds.” The details of this $(66,645) difference are as follows: Decrease in Deferred Building Permit Fees $ (150,190) Decrease in Special Assessments (47,034) Accrued Interest Receivable 23,557 Amortization of Bond Premium 6,593 Ambulance Services 100,755 Decrease in Cemetery Trust Earnings (326) Net adjustment to increase net changes in fund balances-total governmental funds to arrive at changes in net assets of governmental activities $ (66,645) Another element of that reconciliation states that “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.” The details of this $(121,646) difference are as follows: Increase in Compensated Absences not Reported Through Internal Service Funds $ (17,585) Increase in Cemetery Claims (23,035) Decrease in Accrued Interest Payable 25,797 Amortization of - Issuance Costs (48,691) Deferred Amount on Refunding (58,131) Net adjustment to decrease net changes in fund balances total governmental funds to arrive at changes in net assets of governmental activities $ (121,645) 55 ---PAGE BREAK--- CITY OF LAFAYETTE, COLORADO NOTES TO THE FINANCIAL STATEMENTS December 31, 2010 NOTE 3 CASH DEPOSITS AND INVESTMENTS The City, through its Charter and Investment Policy, has adopted the State Statutes dealing with deposits and investments. Deposits and investments at December 31, 2010, are summarized below: Cash and Cash Deposits $ 5,056,015 Investments 49,122,694 $ 54,178,709 Deposits and investments are presented in the financial statements as follows: Unrestricted $ 50,186,403 Restricted 3,992,306 $ 54,178,709 A. Deposits: The Colorado Public Deposit Protection Act (PDPA) requires that all units of local government deposit cash in eligible public depositories. State regulators determine eligibility. Amounts on deposit in excess of federal insurance levels must be collateralized. The eligible collateral is determined by the PDPA. PDPA allows the institution to create a single collateral pool for all public funds. The pool for all the uninsured public deposits as a group is to be maintained by another institution or held in trust. The market value of the collateral must be at least equal to 102% of the aggregate uninsured deposits. On December 31, 2010 the City had uninsured bank deposits of $4,728,083 collateralized by the financial institutions’ agents but not in the City’s name. B. Investments: Colorado statutes specify investment instruments meeting defined rating and risk criteria in which local governments may invest which include:  Obligations of the United States and certain US government agency securities  Certain international agency securities  General obligation and revenue bonds of US local government entities  Bankers’ acceptances of certain banks  Commercial paper  Written repurchase agreements collateralized by certain authorized securities  Certain money market funds  Guaranteed investment contracts  Local government investment pools 56 ---PAGE BREAK--- CITY OF LAFAYETTE, COLORADO NOTES TO THE FINANCIAL STATEMENTS December 31, 2010 NOTE 3 CASH DEPOSITS AND INVESTMENTS (continued) B. Investments (continued): On December 31, 2010, the City had the following investments: Investment Maturities (in Years) Standard & Poors Less Fair Investment Type Rating Than 1 1-3 4-5 Over 5 Value U.S. Treasury * $ 10,549,823 $ 1,005,820 $ - $ - $ 11,555,643 Money Market Funds AAA 236,776 - - - 236,776 U.S. Agency Securities (Callable in 2011) AAA - 16,007,609 - - 16,007,609 U.S. Agency Securities AAA 13,645,137 5,243,438 - - 18,888,575 Local Government Investment Pools AAA 2,201,591 - - - 2,201,591 Municipal Golf Course Revenue Bonds AAA 53,500 179,000 - - 232,500 Totals $ 26,686,827 $ 22,435,867 $ - $ - $ 49,122,694 * - The ratings for U.S. Treasury are not listed because these investments are fully guaranteed by the federal government. Interest Rate Risk – The City’s investment policy follows State statutes. State statutes limit investments in U.S. Agency securities to an original maturity of five years unless the governing board authorizes the investment for a period in excess of five years. Credit Risk – State statutes limit investments in U.S. Agency securities to the highest rating issued by two or more nationally recognized statistical rating organizations (NRSROs). State statutes also 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 NRSRO. Custodial Credit Risk – On December 31, 2010, the City had investments held by Wells Fargo Brokerage Service in a custodial safekeeping account in the amount of $46,451,827. All investments are specifically separate from the investments of the custodian and are identified as being investments of the City of Lafayette. 57 ---PAGE BREAK--- CITY OF LAFAYETTE, COLORADO NOTES TO THE FINANCIAL STATEMENTS December 31, 2010 NOTE 3 CASH DEPOSITS AND INVESTMENTS (continued) B. Investments (continued) Concentration of Credit Risk – Although State statutes do not limit the amount the City may invest in one issuer, the City’s investment policy does set limits. The limits are as follows: U.S. Government Treasury Securities 100%, U.S. Government Agency Securities 70%, Certificates of Deposit 40%, Repurchase Agreements 40%, Liquidity Funds 30%, and Domestic Bankers’ Acceptances 30%. On December 31, 2010, the City’s investment in Federal Home Loan Bank was 15%, Federal Farm Credit Bureau was 18%, Federal Home Loan Mortgage Corporation was 22%, and Federal National Mortgage Association was 16%. The City’s investments in U.S. Government Agency Securities are at 71%, which may be in violation of the City’s investment policy. Local Government Investment Pool - The City had invested $2,201,591 in the Colorado Local Government Liquid Asset Trust (Colotrust) on December 31, 2010. The trust is an investment vehicle established by state statute for local government entities in Colorado to pool surplus funds for investment purposes. The Colorado Division of Securities administers and enforces the requirements of creating and operating the Trust. The Trust operates in conformity with the Securities and Exchange Commission’s Rule 2a7 as promulgated under the Investment Company Act of 1940, as amended. The Trust is rated AAAm by Standard and Poor’s. Investments of the Trust are limited to those allowed by State statures. A designated custodial bank provides safekeeping and depository services in connection with the direct investment and withdrawal functions. The custodian’s internal records identify investments owned by the participating governments. NOTE 4 RESTRICTED CASH AND INVESTMENTS During July 2001, the City received $1,000,000 from the Northwest Parkway Public Highway Authority for capital projects and conservation easement acquisitions related to the Northwest Parkway Project. In 2003 utility lines and sleeves were installed during construction of the Parkway at a cost of $177,196. During 2004, $650,000 was committed for construction of White Tail Park in South Pointe, although only $450,124 was spent on the park. At December 31, 2010, the balance is $372,680. When the City acquired the cemetery property in February 2002, trust accounts were included as part of the transactions. The trust accounts were established in prior years for pre- paid services and endowment care of the cemetery. The responsibility for the endowment care trust was assumed by the City in 2010 and transferred to a permanent fund (Cemetery Endowment Fund). At December 31, 2010, the balances in the pre-need trust and the endowment care trust were $29,846 and $46,398, respectively. 58 ---PAGE BREAK--- CITY OF LAFAYETTE, COLORADO NOTES TO THE FINANCIAL STATEMENTS December 31, 2010 NOTE 4 RESTRICTED CASH AND INVESTMENTS (continued) In December 2002, the Exempla General Improvement District was formed to continue the development of the 287/42 project, and refunding bonds were issued. The bond ordinance requires a debt service reserve in the amount of $1,090,500. In April 2003, the City issued Water Revenue Bonds for the purpose of financing improvements to the water transmission and/or storage facilities and costs associated with joining and purchasing shares in water supply districts. These costs will be paid from available funds when they are incurred. The balance at December 31, 2010 is $1,889,690. In April 2008, the City sold Sales and Use Tax Revenue Bonds in the amount of $6,910,000 for the repair and improvement of City streets, installation of traffic and safety control devices, and construction and remodel of the Recreation Center. At December 31, 2010, $563,192 remained for the above projects. In summary, restricted cash and investments at December 31, 2010 was as follows: Northwest Parkway Related Projects $ 372,680 Pre-need trust 29,846 Cemetery Endowment Fund 46,398 Exempla GID 1,090,500 2003A Water Revenue Bonds 1,889,690 2008 Sales and Use Tax Revenue Bonds 563,192 Total Restricted Cash and Investments $ 3,992,306 59 ---PAGE BREAK--- CITY OF LAFAYETTE, COLORADO NOTES TO THE FINANCIAL STATEMENTS December 31, 2010 NOTE 5 CAPITAL ASSETS Capital asset activity for the year ended December 31, 2010, was as follows: Beginning Balance Increases Decreases Ending Balance Governmental Activities: Capital Assets not being Depreciated Land $ 62,317,301 $ 764,053 $ - $ 63,081,354 Construction in Progress 1,341,492 583,399 (563,235) 1,361,656 Total 63,658,793 1,347,452 (563,235) 64,443,010 Capital Assets - Depreciated Buildings 21,859,826 725,018 - 22,584,844 Improvements Other Than Buildings 2,288,338 1,106,347 - 3,394,685 Infrastructure 73,108,531 3,695,760 - 76,804,291 Equipment 11,886,230 713,732 (906,848) 11,693,114 Total 109,142,925 6,240,857 (906,848) 114,476,934 Less Accumulated Depreciation For: Buildings (5,612,488) (562,427) - (6,174,915) Improvements Other than Buildings (1,952,332) (66,648) - (2,018,980) Infrastructure (26,595,349) (2,865,894) - (29,461,243) Equipment (8,284,914) (973,682) 882,613 (8,375,983) Total Accumulated Depreciation (42,445,083) (4,468,651) 882,613 (46,031,121) Total Capital Assets - Depreciated, Net 66,697,842 1,772,206 (24,235) 68,445,813 Governmental Capital Assets, Net $ 130,356,635 $ 3,119,658 $ (587,470) $ 132,888,823 Business-Type Activities: Capital assets, not being depreciated Land $ 7,662,800 $ 42 $ - $ 7,662,842 Water Rights 25,848,033 476,500 - 26,324,533 Construction in Progress 1,983,624 584,601 (1,460,758) 1,107,467 Total 35,494,457 1,061,143 (1,460,758) 35,094,842 Capital assets - Depreciated Buildings 1,628,134 1,163,990 - 2,792,124 Systems 80,615,693 523,550 - 81,139,243 Improvements other than Buildings 410,720 12,315 - 423,035 Equipment 9,908,607 376,282 (241,134) 10,043,755 Total Capital Assets - Depreciated 92,563,154 2,076,137 (241,134) 94,398,157 Less accumulated depreciation for: Buildings (666,084) (69,231) - (735,315) Systems (23,566,088) (1,729,140) - (25,295,228) Improvements other than buildings (317,834) (13,507) - (331,341) Equipment (6,472,455) (826,744) 240,936 (7,058,263) Total accumulated depreciation (31,022,461) (2,638,622) 240,936 (33,420,147) Total Capital Assets - Depreciated 61,540,693 (562,485) (198) 60,978,010 Business-type Capital Assets, Net $ 97,035,150 $ 498,658 $ (1,460,956) $ 96,072,852 60 ---PAGE BREAK--- CITY OF LAFAYETTE, COLORADO NOTES TO THE FINANCIAL STATEMENTS December 31, 2010 NOTE 5 CAPITAL ASSETS (continued) Depreciation expense was charged to function/program of the City as follows: Governmental Activities General Government $ 202,165 Public Safety 589,186 Public Works 2,647,394 Culture and Recreation 1,029,906 Total depreciation expense governmental activities $ 4,468,651 Business-type Activities Water $ 1,576,530 Water Reclamation 857,666 Golf Course 173,453 Storm Water 30,973 Total depreciation expense business-type activities $ 2,638,622 NOTE 6 LONG-TERM DEBT A. Bonded Debt The City of Lafayette and its component units have three types of bonded debt:  General obligation (serial) bonds  Revenue (term) bonds  Demand bonds General obligation bonds are direct obligations and pledge the full faith and credit of the City. The bonds have been issued for both governmental and business-type activities. General obligation bonds currently outstanding are as follows: Governmental Activities 1998 Refunding and Improvement General Obligation Bonds mature annually through December 15, 2017, interest at 3.60% to 5.10% is paid semi-annually $ 900,000 2005 General Obligation Bonds mature annually through December 15, 2025, interest at 3.00% to 4.40% is paid semi-annually 4,880,000 5,780,000 61 ---PAGE BREAK--- CITY OF LAFAYETTE, COLORADO NOTES TO THE FINANCIAL STATEMENTS December 31, 2010 NOTE 6 LONG-TERM DEBT (continued) A. Bonded Debt (continued) Business – type Activities 2003B General Obligation Water Refunding Bonds mature annually through December 1, 2012, interest at 2.00% to 4.00% is paid semi-annually 635,000 635,000 Total General Obligation Bonded Debt $ 6,415,000 The City has also issued bonds for both governmental and business-type activities where revenues are pledged to pay the debt service. Revenue bonds outstanding at year-end are: Governmental Activities 1999 Limited Tax General Obligation Bonds mature annually through December 1, 2018, interest of 5.75% is paid semi-annually (Lafayette City Center GID) $ 525,000 2006 General Obligation Refunding Bonds mature annually through December 1, 2036, interest of 6.00% is paid semi-annually (Lafayette Tech Center GID) 2,010,000 2002 Limited Tax General Obligation Refunding Bonds mature annually through December 1, 2031, interest at 8.00% is paid semi-annually (Lafayette Corp Campus GID) 2,465,000 2003C Sales and Use Tax Revenue Bonds mature annually through November 15, 2011, interest at 2.00% to 3.50% is paid semi-annually 775,000 2008 Sales and Use Tax Revenue Bonds mature annually through November 15, 2019, interest of 3.31% is paid semi-annually 6,910,000 12,685,000 62 ---PAGE BREAK--- CITY OF LAFAYETTE, COLORADO NOTES TO THE FINANCIAL STATEMENTS December 31, 2010 NOTE 6 LONG-TERM DEBT (continued) A. Bonded Debt (continued) Business-type Activities 2003A Water Revenue Bonds mature annually through December 1, 2027, interest at 4.00% to 5.25% is paid semi-annually 15,645,000 1992 Golf Revenue Bonds matured on October 15, 2002, final maturity extended to December 31, 2014, interest of 5.50% is paid annually 232,500 15,877,500 Total Revenue Bond Debt $ 28,562,500 The obligations of the Lafayette City Center GID, Lafayette Corporate Campus, and Lafayette Tech Center GID are not obligations of the City of Lafayette. The 1992 Golf Revenue Bonds are carried as an investment by the Water Reclamation Fund. Adverse business conditions, made worse by the drought, have caused an extension of the final maturity date of these bonds. Annual graduated principal payments are scheduled through December 31, 2014. Future annual debt service requirements to maturity for the general obligations and revenue bond issues are as follows: Debt Governmental Activities Business-type Activities Requirement Year Principal Interest Principal Interest to Maturity 2011 $ 1,265,000 $ 845,683 $ 363,500 $ 795,244 $ 3,269,427 2012 1,280,000 795,673 381,500 779,899 3,237,072 2013 1,330,000 745,810 804,600 763,792 3,644,202 2014 1,385,000 693,805 837,900 730,714 3,647,419 2015 1,445,000 638,261 805,000 698,194 3,586,455 2016-2020 6,490,000 2,301,326 4,625,000 2,900,869 16,317,195 2021-2025 2,925,000 1,300,218 5,895,000 1,629,719 11,749,937 2026-2030 1,360,000 632,480 2,800,000 211,750 5,004,230 2031-2035 840,000 175,600 - - 1,015,600 2036-2037 145,000 8,700 - - 153,700 Total $ 18,465,000 $ 8,137,556 $ 16,512,500 $ 8,510,181 $ 51,625,237 63 ---PAGE BREAK--- CITY OF LAFAYETTE, COLORADO NOTES TO THE FINANCIAL STATEMENTS December 31, 2010 NOTE 6 LONG-TERM DEBT (continued) A. Bonded Debt (continued) Demand bonds comprise the third type of bonded debt issued by the City of Lafayette. These bonds have been issued for governmental activities, but are not obligations of the City of Lafayette. Demand bonds outstanding at December 31, 2010, are as follows: Exempla General Improvement District Special Assessment Revenue Refunding and Improvement Bonds mature annually through December 1, 2022 $ 3,955,000 Total Demand Bond Debt $ 3,955,000 These bonds bear interest at floating rates and are subject to mandatory redemption upon conversion of the interest rate to a different rate type or rate period. On July 1, 2009, the GID redeemed $6,510,000 face amount of the bonds as requested by Exempla Healthcare. The redemption reduced the outstanding principal to $ 3,955,000 and assured that there would not be any additional principal payments required until the year 2018. An initial irrevocable letter of credit was issued as collateral for the Exempla bonds for a maximum amount equal to the principal amount of the bonds, plus 35 days interest at a maximum annual rate of 10%. The initial letter of credit was replaced by an alternate letter of credit, reduced by the redemption, with an expiration date of January 29, 2012. The issuer and the bank have entered into a reimbursement agreement as an integral part of the issued letters of credit. Among other things, the reimbursement agreement provides for repayment to the bank of all drawings made under the letters of credit, together with interest, fees, and other costs, certain affirmative and negative covenants to be observed on the part of the issuer, and certain indemnification obligations on the part of the issuer. These bonds are not obligations of the City of Lafayette. The debt service requirements must be met by the resources generated by the District. As described above, these bonds currently bear interest at floating rates. The final interest rate on December 31, 2010 was 0.33%. At some time in the future, the rates will be converted to a fixed rate. Although interest rates in future periods may vary considerably, an interest factor of 0.33% has been used in projected annual debt service requirements. 64 ---PAGE BREAK--- CITY OF LAFAYETTE, COLORADO NOTES TO THE FINANCIAL STATEMENTS December 31, 2010 NOTE 6 LONG-TERM DEBT (continued) A. Bonded Debt (continued) Year Principal Interest Total 2011 $ - $ 13,052 $ 13,052 2012 - 13,052 13,052 2013 - 13,052 13,052 2014 - 13,052 13,052 2015 - 13,052 13,052 2016-2020 2,065,000 60,305 2,125,305 2021-2022 1,890,000 9,422 1,899,422 Total $ 3,955,000 $ 134,987 $ 4,089,987 B. Notes Payable During 2001, the City entered into two long-term loans for construction projects, one involving a governmental activity, and the other, a business-type activity. A loan of $950,000 was obtained from Great Western Bank, (previously Heritage Bank), to construct a building, which was completed in 2002, for the Sister Carmen Community Center in a lease-purchase arrangement. The loan balance of $647,492 is payable in semi-annual installments of $39,945, including interest at 5.65%. Annual debt service requirements to maturity are: Year Principal Interest Total 2011 $ 647,492 $ 24,804 $ 672,296 Total $ 647,492 $ 24,804 $ 672,296 The note to Great Western Bank for the Sister Carmen Community Center was paid off in March of 2011. In May 2001, the Water Reclamation Fund obtained an $8,000,000 loan from the Colorado Water Resources and Power Development Authority to construct an addition to the waste water treatment plant. The City evidenced its obligation to repay the loan by issuing a bond to at an effective interest rate of 4.20%, in an amount equal to the principal of the clean water bonds loaned to the City. Net revenues of the Water Reclamation Fund are pledged for repayment of the loan. In 2005 the bonds were refinanced at an effective interest rate of 3.80%. The loan balance of $5,723,859 is payable in semi-annual installments. Annual debt service requirements to maturity have been calculated at the refinanced rate of 3.80% as follows: 65 ---PAGE BREAK--- CITY OF LAFAYETTE, COLORADO NOTES TO THE FINANCIAL STATEMENTS December 31, 2010 NOTE 6 LONG-TERM DEBT (continued) B. Notes Payable (continued) Year Principal Interest Total 2011 $ 435,155 $ 217,619 $ 652,774 2012 438,819 201,258 640,077 2013 460,391 183,519 643,910 2014 481,405 165,482 646,887 2015 497,741 146,675 644,416 2016-2020 2,781,549 427,401 3,208,950 2021 628,799 18,379 647,178 Total $ 5,723,859 $ 1,360,333 $ 7,084,192 On February 15, 2006 the Water Fund acquired one unit of Windy Gap water and assumed a pro-rata portion of the related debt incurred by the Municipal Subdistrict of the Northern Colorado Water Conservancy District for the construction of the Windy Gap project. The total debt assumed was $174,417. The balance due on December 31, 2010 is $118,647. Annual debt service payments are billed by the Municipal Subdistrict with the annual water assessments. The rate of interest is approximately 5.00%. Annual debt service requirements to maturity are: Year Principal Interest Total 2011 $ 13,885 $ 6,134 $ 20,019 2012 15,021 5,440 20,461 2013 15,958 4,693 20,651 2014 16,782 3,862 20,644 2015 17,677 2,987 20,664 2016-2017 39,324 3,123 42,447 Total $ 118,647 $ 26,239 $ 144,886 C. Pledged Revenues The 2003C Sales and Use Tax Revenue Bonds were issued to refinance the 1993 Sales and Use Tax Revenue Bonds. Total outstanding obligation for these bonds as of December 31, 2010, is $802,125; $775,000 in principal and $27,125 in interest. In April of 2008, the City issued 2008 Sales and Use Tax Revenue Bonds to finance street improvements and an addition to the Recreation Center. Total outstanding obligation for these bonds as of December 31, 2010, is $8,209,674; $6,910,000 in principal and $1,299,674 in interest. Both issues are payable from a 3.00% municipal sales and use tax. During the year ended December 31, 2010, revenues of $8,310,576 were available to pay the annual debt service of $1,030,221. 66 ---PAGE BREAK--- CITY OF LAFAYETTE, COLORADO NOTES TO THE FINANCIAL STATEMENTS December 31, 2010 NOTE 6 LONG-TERM DEBT (continued) C. Pledged Revenues (continued) The 2003A Water Revenue Bonds were issued for the purpose of financing any or all of the following: the construction of a raw water transmission system, the purchase of real property and construction of a raw water storage facility, the payment of costs associated with fees for joining and purchasing shares in water supply districts, or the development of a reclaimed water transmission system for irrigation purposes. Total outstanding obligation for these bonds as of December 31, 2010, is $24,083,856; $15,645,000 in principal and $8,438,956 in interest. Debt service is payable from net revenues of the City’s municipal water system. During the year ended December 31, 2010, net revenues of $3,542,118 were available to pay annual debt service of $757,056. The City received a loan in 2001 from the Colorado Water Resources and Power Development Authority in order to finance the expansion of the City’s Water Reclamation facility. The loan was refinanced in 2005. Total outstanding obligation for this loan as of December 31, 2010, is $7,084,191; $5,723,859 in principal and $1,360,333 in interest. The loan is payable from net revenues of the City’s water reclamation system. During the year ended December 31, 2010, net revenues of $632,692 after reduction for transfers out of $262,767, were not sufficient to pay annual debt service of $650,517. The annual debt service amount is the amount per the debt service schedule. Because revenues were not sufficient to pay annual debt service, the City is not in compliance with the loan covenant. Sewer rates were increased 9% in 2010 with scheduled increases proposed through 2014 in order to restore net revenues and compliance. The 1992 Golf Course Revenue Bonds were issued to finance the construction of a municipal golf course. Total outstanding obligation for these bonds as of December 31, 2010, is $265,325; $232,500 in principal and $32,825 in interest. The debt is payable from net revenues of the City’s golf course. During the year ended December 31, 2010, net revenues of $29,006 were not sufficient to pay annual debt service of $66,380. Earnings from prior years were used to satisfy the debt service obligations. The bonds for the Exempla General Improvement District were issued in December of 2002 to finance the costs of improvements on 79 acres of land being developed primarily for non- profit commercial use by the Exempla Northwest Medical Center. Revenues are generated from special assessments on a semi-annual basis in order to service the debt. Assessments are billed using an interest rate of 10.00% as required by bond documents. Excess revenues have been accumulating the past few years as a result of the large gap between actual interest being paid and the 10.00% rate. 67 ---PAGE BREAK--- CITY OF LAFAYETTE, COLORADO NOTES TO THE FINANCIAL STATEMENTS December 31, 2010 NOTE 6 LONG-TERM DEBT (continued) C. Pledged Revenues (continued) At December 31, 2010, net excess credits amounted to $219,989. The net excess credits will be carried over to 2011 to offset interest due. No principal payments are due in 2011. The Lafayette City Center General Improvement District bonds, issued in December of 1999, were issued to finance improvements within a specific area of the City of Lafayette. Total outstanding obligation for these bonds as of December 31, 2010, is $669,902; $525,000 in principal and $144,902 in interest. The debt is payable from gross revenues of the General Improvement District. For the year ending December 31, 2010, gross revenues of $86,275 were available to pay annual debt service of $77,775. In December, 2002, the Lafayette Corporate Campus General Improvement District bonds were issued to finance public improvements in the District. Total outstanding obligation for these bonds as of December 31, 2010, is $5,168,680; $2,465,000 in principal and $2,703,680 in interest. During the year ended December 31, 2010, gross revenues of $262,753 were available to pay debt service of $245,800. The Lafayette Tech Center General Improvement District bonds were issued in December 2000 to be used to finance the acquisition, construction, installation and completion of public improvements within the District. In 2006, the bonds were refinanced. Total outstanding obligation for these bonds as of December 31, 2010, is $4,011,900; $2,010,000 in principal and $2,001,900 in interest. For the year ending December 31, 2010, gross revenues of $169,781 were available to pay debt service of $152,400. 68 ---PAGE BREAK--- CITY OF LAFAYETTE, COLORADO NOTES TO THE FINANCIAL STATEMENTS December 31, 2010 NOTE 6 LONG-TERM DEBT (continued) D. Capital Leases In December of 2007 the fire department purchased a fire truck at a cost of $727,544 by using a lease purchase agreement. The future minimum lease obligations as of December 31, 2010 are as follows: 2011 $ 119,391 2012 119,391 2013 119,391 2014 119,391 477,564 Less amount representing interest (38,470) Present value of remaining lease payments $ 439,094 On February 5, 2008, the city entered into a lease purchase arrangement for energy saving improvements at various city facilities at a cost of $1,113,279. The future minimum lease obligations as of December 31, 2010 are as follows: 2011 $ 122,554 2012 133,087 2013 138,677 2014 144,500 2015 149,090 2016-2018 410,739 1,098,647 Less amount representing interest (157,255) Present value of remaining payments $ 941,392 69 ---PAGE BREAK--- CITY OF LAFAYETTE, COLORADO NOTES TO THE FINANCIAL STATEMENTS December 31, 2010 NOTE 6 LONG-TERM DEBT (continued) E. Changes in Long-term Liabilities Long-term liability activity for the year ended December 31, 2010, was as follows: Beginning Balance Additions Reductions Ending Balance Due Within One Year Governmental Activities: Bonds Payable General Obligation Bonds $ 6,355,000 $ - $ 575,000 $ 5,780,000 $ 355,000 Revenue Bonds 13,555,000 - 870,000 12,685,000 910,000 Demand Bonds 3,955,000 - - 3,955,000 - Total Bonds Payable 23,865,000 - 1,445,000 22,420,000 1,265,000 Deferred Amounts For Issuance Premiums 18,435 - 6,593 11,842 - On Refunding (502,332) - (58,131) (444,201) - Total Bonds Payable, Including deferred amounts 23,381,103 - 1,393,462 21,987,641 1,265,000 Notes Payable 689,008 - 41,516 647,492 647,492 Capital Leases 1,774,385 - 393,899 1,380,486 191,252 Compensated Absences 872,719 992,927 984,046 881,600 661,200 Governmental Activity long- term activities $ 26,717,215 $ 992,927 $ 2,812,923 $ 24,897,219 $ 2,764,944 Business-type Activities Bonds Payable General Obligation Bonds $ 2,090,000 $ - $ 1,455,000 $ 635,000 $ 310,000 Revenue Bonds 15,928,300 - 50,800 15,877,500 53,500 Total Bonds Payable 18,018,300 - 1,505,800 16,512,500 363,500 Deferred Amounts For Issuance Premiums 422,606 - 29,016 393,590 - On Refunding (114,713) - (34,009) (80,704) - Total Bonds Payable, Including deferred amounts 18,326,193 - 1,500,807 16,825,386 363,500 Notes Payable 6,272,317 - 429,811 5,842,506 449,040 Capital Leases 25,251 - 25,251 - - Compensated Absences 261,086 273,350 263,290 271,146 166,182 Business-type activity long- term activities $ 24,884,847 $ 273,350 $ 2,219,159 $ 22,939,038 $ 978,722 NOTE 7 AMENDMENT ONE Colorado voters passed an amendment to the State Constitution, Article X, Section 20 (Amendment One), which has several limitations, including revenue raising limitations, spending limits, and other specific requirements of state and local governments. The Amendment is complex and subject to judicial interpretation. Over the course of several municipal elections and in accordance with state law, the citizens of Lafayette have exempted the City from the certain provisions of Article X, Section 20. The ballot issues allow the City to retain the current mill levy and all surplus tax revenues, and exempt the City from the spending limits noted in the State Constitution. 70 ---PAGE BREAK--- CITY OF LAFAYETTE, COLORADO NOTES TO THE FINANCIAL STATEMENTS December 31, 2010 NOTE 8 INTERFUND TRANSFERS, RECEIVABLES, AND PAYABLES The following interfund transfers occurred during 2010 for the purposes stated below. Transfers Out Transfers In Fund Description Amount General Fund Debt Service Fund General Fund Capital Lease Payments $ 539,659 $ - $ 539,659 Ambulance & Fire Fund Reimburse for Services 334,242 334,242 - Lafayette Urban Renewal Authority Maintenance 47,674 47,674 - Parks, Open Space, & Trails Fund Maintenance 776,694 776,694 - Capital Projects Fund Reimburse for Water Line Upgrade at Rec Center 36,733 36,733 Water Fund Administrative Charges 727,477 727,477 - Water Reclamation Fund Administrative Charges 262,767 262,767 - Golf Course Fund Administrative Charges 127,548 127,548 - Reimburse for Golf Course Construction 432,810 432,810 - Storm Water Fund Administrative Charges 66,165 66,165 - $ 3,351,769 $ 2,812,110 $ 539,659 NOTE 9 EMPLOYEE RETIREMENT PLANS The City’s employees and volunteer fire fighters are covered under three separate retirement plans. A. General Employees The City offers its full-time employees and key management officials a retirement plan created in accordance with Internal Revenue Code (IRC) Section 401(a). Employees are eligible to participate in the plan on the first day of employment as a full-time employee. A full-time employee is any employee who is regularly scheduled to work at least 40 hours per week for the City and whose position is approved by City Council. This plan is a defined contribution plan administered by International City/County Management Association – Retirement Corporation (ICMA-RC). Under the terms of the plan, the City is the only non-employee contributor and contributes 10.2% of the participant’s salary (salary, pay or earned income less salary reductions made under IRC Section 125), and the participant is required to contribute 8% of salary. Contribution requirements of the City and the participants are established and may be amended by the City Council. During the year ended December 31, 2010, the City and employees made all required contributions to the plan, of $661,490 and $519,759, respectively. 71 ---PAGE BREAK--- CITY OF LAFAYETTE, COLORADO NOTES TO THE FINANCIAL STATEMENTS December 31, 2010 NOTE 9 EMPLOYEE RETIREMENT PLANS (continued) A. General Employees (continued) An employee shall have a non-forfeitable interest in the percentage of the employer contribution account determined pursuant to the following vesting schedule. Forfeitures from the non-vested portion of terminated employees’ accounts are used to reduce the contribution required by the City. Years of Percentage Service Vested 1 20% 2 40% 3 60% 4 80% 5 100% An employee shall have a non-forfeitable interest in their entire employer account if they are employed by the city when they become disabled or die. Voluntary after-tax contributions are allowed up to an additional 25% of the employee’s compensation. Since a third party trustee holds the assets in trust, they are not reflected on the City’s financial statements. The annual financial report of ICMA-RC may be obtained by writing to ICMA-RC, 777 North Capitol Street, NE, Washington, DC 20002 or by calling them at 202- 962-4601. B. Commissioned Police Officers, Firefighters, and Ambulance Personnel In May 2005, the City, after approval by police officers and City Council, transferred the assets to a cost-sharing multiple-employer defined benefit system administered by the Fire and Police Pension Association of Colorado (FPPA). Subsequently, the firefighters transferred their assets from the general employees’ retirement plan to the FPPA plan and the ambulance employees adopted this plan when they were hired in 2007 and thereafter. During this process, every effort was made to retain continuity between the old and new plan provisions. Vesting applies at 20% per year with full vesting after 5 years. There are three different plan structures within the FPPA Defined Benefit System. 1. Statewide Money Purchase Plan and Money Purchase component of the Statewide Hybrid Plan, 2. Defined Benefit component of the Statewide Hybrid Plan, and 3. Statewide Defined Benefit Plan. 72 ---PAGE BREAK--- CITY OF LAFAYETTE, COLORADO NOTES TO THE FINANCIAL STATEMENTS December 31, 2010 NOTE 9 EMPLOYEE RETIREMENT PLANS (continued) B. Commissioned Police Officers, Firefighters, and Ambulance Personnel (continued) Plan members and the City are required to contribute to the Statewide Defined Benefit Plan and the Statewide Hybrid Plan at the rate established under Title 31, Article 31, of the Colorado Revised Statutes (CRS), as amended. Police officers employed on May 1, 2005 could elect the Statewide Hybrid Plan option with contributions the same as with the old plan employee & 10.2% City), or the Statewide Defined Benefit Plan - Additional Contribution option with contributions of 9.8% from the employees and 10.2% from the City, or the Statewide Defined Benefit Plan option with contributions of 8% employee & 8% employer. The assets for the accounts transferred from the old plan were placed in the Money Purchase component of the Statewide Hybrid Plan. Police officers and firefighters hired after May 1, 2005 and ambulance employees must be covered under the FPPA Statewide Defined Benefit Plan with contributions of 8% from the employee and 8% from the City. The remaining 2.2% contributed by the City for the commissioned police officers, firefighters, and ambulance personnel is paid to the ICMA-RC money purchase plan. Statewide Hybrid Plan – The City and the employees have made contributions to this plan for the past three years equal to 10.2% and 8.0% of regular pay. The City and employees made the required contributions to the plan in 2010 of $61,502 and $48,237, in 2009 of $63,524 and $49,823, and in 2008 of $70,741 and $55,483, respectively. Defined Benefit Plan-Additional Contribution – The City and the employees have made contributions to this plan for the past three years equal to 10.2% and 9.8% of regular pay. The City and employees made the required contributions to the plan in 2010 of $153,664 and $147,639, in 2009 of $163,034 and $156,641, and in 2008 of $161,034 and $154,719, respectively. Statewide Defined Benefit Plan – The City and the employees have made contributions to this plan for the past three years equal to 8.0% and 8.0% of regular pay. The City and employees made the required contributions to the plan in 2010 of $122,984 and $122,984, in 2009 of $105,848 and $105,848, and in 2008 of $89,477 and $89,477, respectively. An employee shall have a non-forfeitable interest in their entire employer account if they are employed by the City when they become disabled or die. Title 31, Article 31, Part 1101, of the CRS, as amended, assigns authority to establish benefit provisions to the State Legislature. Since a third party trustee holds the assets in trust, they are not reflected on the City’s financial statements. The annual financial report of FPPA may be obtained by writing to FPPA, 5290 DTC Parkway, Suite 100, Greenwood Village, CO 80111-2721 or by calling them at 1-[PHONE REDACTED]. 73 ---PAGE BREAK--- CITY OF LAFAYETTE, COLORADO NOTES TO THE FINANCIAL STATEMENTS December 31, 2010 NOTE 9 EMPLOYEE RETIREMENT PLANS (continued) B. Commissioned Police Officers, Firefighters, and Ambulance Personnel (continued) In addition, retirement contributions on overtime or non-regular pay are not allowed by FPPA. Contributions on overtime and non-regular pay made by the Police, Fire and Ambulance employees are 8% and the City contributes 10.2% to ICMA-RC. In 2010 the City paid $31,618 and the employees paid $24,798. The City paid $33,821 to ICMA-RC in 2010 for the 2.2% match on the FPPA Statewide Defined Benefit Plan. C. Volunteer Fire Fighters Plan Description - The City provides a defined benefit pension plan for volunteer firefighters as established by Title 31, Article 30, Section 401 of the Colorado Revised Statutes. The Colorado Fire & Police Pension Association (FPPA) administers this agent multiple employer plan. Any firefighter who has both attained the age of fifty and completed twenty years of active service shall be eligible for a pension. A firefighter who is disabled in the line of duty and whose disability is considered permanent shall be compensated in an amount determined by the Board of Trustees to be reasonable and proper considering the financial condition of the fund. The Plan also provides for a lump-sum burial benefit upon the death of an active or retired firefighter. Spouses of deceased firefighters may receive benefits as authorized by State Statute. The annual financial report of FPPA may be obtained by writing to FPPA, 5290 DTC Parkway, Suite 100, Greenwood Village, CO 80111-2721 or by calling them at 1-[PHONE REDACTED]. Funding Policy - The Volunteer Firefighters’ Pension Plan receives contributions from the City in an amount not to exceed one-half mill of property tax revenue. As established by the legislature, the State of Colorado contributes ninety percent of the City’s contribution up to the $300 per month normal retirement benefit level. For benefits beyond $300, the State contribution is limited to the City’s contribution before the increase in benefits. The on- behalf payments received from the State of Colorado are recorded as both revenues and expenditures during the year. The contributions are actuarially determined. The actuarial study as of January 1, 2009, presented the required contribution level for three different plan options available through the Fire & Police Pension Association. Effective January 1, 2007, the City is funding normal retirement benefits of $525 per month. As a result, the accumulated contributions in excess of the required contributions under the previous benefit level have been applied to the unfunded liability balance of the increased benefit level. The actuarial study as of January 1, 2009, indicated that the current contributions to the fund are not adequate to support the prospective benefits for the present plan on an actuarially sound basis. In 2009, the City contributed $13,174 more than the actuarially determined required contribution based on the recommendation of FPPA. The required contributions for 2009 and 2010 were increased $13,174 each year based on the actuarial report to a required funding level of $145,382. For the year ended December 31, 74 ---PAGE BREAK--- CITY OF LAFAYETTE, COLORADO NOTES TO THE FINANCIAL STATEMENTS December 31, 2010 NOTE 9 EMPLOYEE RETIREMENT PLANS (continued) C. Volunteer Fire Fighters (continued) 2010, the City and State actual contributions of $103,160 and $42,222, respectively, did equal the required contribution. The required contribution was determined as part of the January 1, 2009 actuarial valuation using the entry age normal cost method. Actuarial assumptions which have changed since the prior valuation included the following: 1. Interest rate - 8.0% per annum, compounded annually, net of operating expenses 2. Retirement age - Age 50 and 20 years of service 3. Disability - Graduated rates for all disabilities 4. Mortality - 1994 Group Annuity Mortality Table 5. Separation - Graduated rates for all withdrawals 6. Marital Status - 90% married, with males being three years older 7. Asset Valuation - Three-year smoothed method 8. Inflation - 3.5% Based on an amortization period of twenty years using the level dollar method on an open basis, the Plan’s expected contributions equal the amount recommended to eliminate the unfunded actuarial accrued liability. Trend Information of the Plan follows: Percentage Net Pension Fiscal Year Annual Pension of APC Obligation Funding Cost (APC) Contributed (Excess) 12/31/2008 $ 132,208 100% $ - 12/31/2009 145,382 100% - 12/31/2010 145,382 100% - Funded Status and Funding Progress – As of January 1, 2009, the most recent actuarial valuation date, the plan was 49 percent funded. The actuarial accrued liability for benefits was $2.2 million and the actuarial value of assets was $1.1 million, resulting in an unfunded actuarial accrued liability (UAAL) of $1.1 million. The schedule of funding progress, presented as RSI following the notes to the financial statements, presents multiyear trend information about whether the actuarial value of plan assets is increasing or decreasing over time relative to the actuarial accrued liability for benefits. NOTE 10 RISK MANAGEMENT The City is exposed to various risks of loss related to torts; thefts of, damage to, or destruction of assets; errors or omissions; injuries to employees; or acts of God. For these 75 ---PAGE BREAK--- CITY OF LAFAYETTE, COLORADO NOTES TO THE FINANCIAL STATEMENTS December 31, 2010 NOTE 10 RISK MANAGEMENT (continued) risks of loss, the City acquires insurance for property liability, police professional liability, errors and omissions, excess liability, and crime coverage through the Colorado Intergovernmental Risk Sharing Agency (CIRSA). The City does not exercise oversight responsibility nor does it exercise significant influence over CIRSA’s operations. Premiums and coverage obtained from CIRSA are comparable to those provided by commercial carriers. CIRSA is an organization created by an intergovernmental agreement to provide property, general and automobile liability, and public official coverage to its members. Coverage is provided through CIRSA self-funding and various excess insurance contracts that limit maximum losses and minimize exposure on large risks. CIRSA does not have a legal obligation to pay losses or loss adjustment expenses in excess of its annually established loss fund and amounts recoverable under excess specific aggregate insurance contracts. Losses and loss adjustment expenses incurred in excess of loss funds and amounts recoverable from excess insurance are direct liabilities of the participating members. The City continues to carry commercial insurance coverage for other risks of loss including workers compensation and employee health and accident insurance. The amount of settlements has not exceeded insurance coverage in any of the past three fiscal years. The Insurance Fund, an internal service fund, was established to account for claims and insurance premiums related to property and liability risks. The City is responsible for the first $25,000 of each claim. Changes in the balances of claims liabilities during the past two years are as follows: The City established the Employee Benefit Fund, an internal service fund to manage and account for the rising costs of all employee insurance benefits. Under the provisions of the current employee health insurance plan, the City pays a fixed premium, per participant, and is fully insured. NOTE 11 SPECIAL ITEM In 2004, the Lafayette Urban Renewal Authority entered into a redevelopment agreement at the time the shopping center at 400 South Boulder Road was acquired through a joint effort between the City and Willow River Markets LLLP. The City received a note secured by a second deed of trust in the amount of $2,350,000 for its participation in the acquisition. Dec. 31, 2008 Claims Incurred Claims Paid Dec. 31, 2009 Claims Incurred Claims Paid Dec. 31, 2010 Property & Liability $ 22,924 $ 58,318 $ 71,642 $ 9,600 $ 56,579 $ 50,409 $ 15,770 76 ---PAGE BREAK--- CITY OF LAFAYETTE, COLORADO NOTES TO THE FINANCIAL STATEMENTS December 31, 2010 NOTE 11 SPECIAL ITEM (continued) During the early part of 2011, the mortgagee obtained an appraisal on the property lowering the value to the point of eroding the value of the note by $1,175,000. The adjustment was applied to the Balance Sheet in the Governmental Funds and the Government Wide Statements of Net Assets and Activities. NOTE 12 CONDUIT DEBT In 1998 and 1999, the City issued $8,470,000 of Industrial Development Revenue Bonds for the purpose of providing capital financing for Rocky Mountain Instruments Co. The balance outstanding at December 31, 2010 was $5,740,000. The bonds are payable solely from the revenues and receipts pledged under this indenture. The bonds do not constitute a debt of the City of Lafayette and are not a pledge of the full faith and credit or taxing power of the City. NOTE 13 COMMITMENTS AND CONTINGENCIES The City has received grants to assist with the construction of facilities and other projects. Under the terms of the grant agreements, such grants are subject to review and audit by the Grantor. Such audits could lead to a request for reimbursements to the Grantor for expenditures disallowed. City management believes any disallowance would be immaterial. NOTE 14 PENDING LITIGATION The City of Lafayette is involved in pending and threatened litigation for which the outcome is unknown. 77 ---PAGE BREAK--- REQUIRED SUPPLEMENTARY INFORMATION FINANCIAL SECTION 2010 78 ---PAGE BREAK--- 01/01/09 01/01/07 01/01/05 01/01/03 01/01/01 $525 Level $500 Level $500 Level $475 Level $450 Level Actuarial Value of Assets 1,105,412 $ 1,206,349 $ 1,025,695 $ 1,001,398 $ 1,110,995 $ Actuarial Accrued Liability-entry age 2,250,777 2,123,394 2,153,723 1,905,576 1,833,842 Unfunded Actuarial Accrued Liability (b-a) 1,145,365 $ 917,045 $ 1,128,028 $ 904,178 $ 722,847 $ Funded ratio (a/b) 49% 57% 48% 53% 61% Covered payroll N/A N/A N/A N/A N/A Actuarial Valuation Date CITY OF LAFAYETTE, COLORADO SCHEDULE OF FUNDING PROGRESS VOLUNTEER FIRE FIGHTER'S PENSION PLAN December 31, 2010 79 ---PAGE BREAK--- Original Final Budget Budget Actual Variance Revenues Taxes Property Taxes 2,978,914 $ 2,978,914 $ 3,000,100 $ 21,186 $ Fire District Tax 5,300 5,300 5,300 - Specific Ownership Tax 199,489 199,489 181,866 (17,623) General Sales & Use Tax 6,277,296 6,277,296 6,414,989 137,693 Motor Vehicle Use Tax 192,741 192,741 828,943 636,202 Building Use Tax 42,947 42,947 396,242 353,295 Total Taxes 9,696,687 9,696,687 10,827,440 1,130,753 License and Permits Business Licenses 10,525 10,525 16,600 6,075 Contractor Licenses 48,125 48,125 64,930 16,805 Liquor Licenses 10,000 10,000 13,737 3,737 Construction Permits 80,053 80,053 270,113 190,060 Mobile Home Permits 10,000 10,000 9,516 (484) Miscellaneous Licenses 3,500 3,500 2,117 (1,383) Total Licenses and Permits 162,203 162,203 377,013 214,810 Intergovernmental Federal, State, and County Grants 154,002 154,002 604,528 450,526 Cultural Arts Grant 7,300 7,300 8,550 1,250 Cigarette Tax 28,000 28,000 34,688 6,688 Motor Vehicle Registration 75,000 75,000 81,657 6,657 County Road and Bridge Tax 25,000 25,000 33,943 8,943 Highway Users Tax 569,655 569,655 714,883 145,228 Nutrition Grant 25,000 25,000 38,192 13,192 Total Intergovernmental 883,957 883,957 1,516,441 632,484 Fines and Forfeitures Fines 966,152 966,152 922,726 (43,426) Court Costs 50,000 50,000 50,515 515 Total Fines and Forfeitures 1,016,152 1,016,152 973,241 (42,911) CITY OF LAFAYETTE, COLORADO BUDGETARY COMPARISON SCHEDULE GENERAL FUND For the Fiscal Year Ended December 31, 2010 80 ---PAGE BREAK--- Original Final Budget Budget Actual Variance CITY OF LAFAYETTE, COLORADO BUDGETARY COMPARISON SCHEDULE GENERAL FUND For the Fiscal Year Ended December 31, 2010 Revenues (continued) Interest and Other Franchise Taxes 840,024 $ 840,024 $ 981,752 $ 141,728 $ Special Assessments Principal 16,424 16,424 48,499 32,075 Special Assessments Interest 5,811 5,811 3,736 (2,075) Interest 200,000 200,000 147,027 (52,973) Sidewalk Maintenance/Repair 88,555 88,555 89,439 884 PEG Fees 30,000 30,000 29,854 (146) Public Art Fees 325 325 1,645 1,320 Contributions and Misc Grants 35,000 35,000 108,027 73,027 Property Sales - - 42,831 42,831 Community Fundraiser - - 3,850 3,850 Total Interest and Other 1,216,139 1,216,139 1,456,660 240,521 Charges for Services Building Fees 43,455 43,455 252,010 208,555 Culture and Recreation Fees 1,404,835 1,404,835 1,598,255 193,420 Cemetery Fees 45,000 45,000 28,500 (16,500) Administrative Fees 43,500 43,500 41,988 (1,512) Misc Rentals 155,785 155,785 155,065 (720) Pawn Shop Fees 9,554 9,554 10,615 1,061 Police Service Fees 19,000 19,000 38,787 19,787 Ambulance Fees 500,000 500,000 363,501 (136,499) Solid Waste and Recycling Fees 859,637 859,637 879,914 20,277 Miscellaneous Services 110,500 110,500 120,642 10,142 Total Charges for Services 3,191,266 3,191,266 3,489,277 298,011 Total Revenues 16,166,404 16,166,404 18,640,072 2,473,668 Expenditures General Government City Council 112,238 148,206 93,401 54,805 Non-Departmental 1,063,807 1,112,230 1,123,828 (11,598) City Administrator City Administrator 401,106 2,047,478 1,473,559 573,919 Human Resources 278,632 285,121 280,425 4,696 City Clerk 201,422 203,805 170,767 33,038 Finance Financial Services 509,192 543,145 509,021 34,124 Information Technologies 617,491 634,616 628,694 5,922 Community Development 735,842 830,832 785,331 45,501 81 ---PAGE BREAK--- Original Final Budget Budget Actual Variance CITY OF LAFAYETTE, COLORADO BUDGETARY COMPARISON SCHEDULE GENERAL FUND For the Fiscal Year Ended December 31, 2010 Expenditures (continued) General Building Maintenance 679,171 $ 686,156 $ 678,973 $ 7,183 $ Total General Government 4,598,901 6,491,589 5,743,999 747,590 Judicial City Attorney 212,185 225,165 191,140 34,025 Municipal Court 121,668 124,375 119,655 4,720 Total Judicial 333,853 349,540 310,795 38,745 Public Safety Police 4,899,920 4,925,794 4,946,789 (20,995) Fire 794,554 799,207 724,919 74,288 Ambulance 777,773 874,441 1,031,487 (157,046) Total Public Safety 6,472,247 6,599,442 6,703,195 (103,753) Public Works Administration - Public Works 1,117,257 1,423,461 1,272,576 150,885 Solid Waste & Recycling 799,606 799,606 809,265 (9,659) Total Public Works 1,916,863 2,223,067 2,081,841 141,226 Culture and Recreation Admin - Parks, Open Space, & Golf 131,403 133,591 132,562 1,029 Cemeteries 105,603 127,771 94,710 33,061 Parks 745,670 746,053 710,893 35,160 Open Space Maintenance 314,414 317,803 207,944 109,859 Admin - Recreation & Facility Management 338,458 344,164 353,633 (9,469) Leisure Services 492,882 487,007 483,765 3,242 Recreation Center 1,336,218 1,369,439 1,281,007 88,432 Library 964,228 979,260 1,015,273 (36,013) Community Life 125,991 174,452 181,235 (6,783) Senior Citizens 346,009 349,008 337,425 11,583 Total Culture and Recreation 4,900,876 5,028,548 4,798,447 230,101 Capital Outlay 1,396,406 3,597,029 1,693,809 1,903,220 Capital Budget Carryover - (59,578) - (59,578) Total Expenditures 19,619,146 24,229,637 21,332,086 2,897,551 Excess (Deficiency) of Revenues Over Expenditures (3,452,742) (8,063,233) (2,692,014) 5,371,219 82 ---PAGE BREAK--- Original Final Budget Budget Actual Variance CITY OF LAFAYETTE, COLORADO BUDGETARY COMPARISON SCHEDULE GENERAL FUND For the Fiscal Year Ended December 31, 2010 Other Financing Sources (Uses) Transfers In 3,175,234 $ 3,229,396 $ 2,812,110 $ (417,286) $ Transfers Out (375,073) (651,628) (539,659) 111,969 Total Other Financing Sources (Uses) 2,800,161 2,577,768 2,272,451 (305,317) Net Change in Fund Balance (652,581) (5,485,465) (419,563) 5,065,902 Fund Balance, January 1 12,531,989 13,804,092 13,804,092 - Fund Balance, December 31, Budgetary Basis 11,879,408 $ 8,318,627 $ 13,384,529 $ 5,065,902 $ See the accompanying independent auditors' report. 83 ---PAGE BREAK--- Original Final Budget Budget Actual Variance Revenues Property Tax 128,496 $ 128,496 $ 128,879 $ 383 $ Sales and Use Tax 81,423 81,423 54,632 (26,791) Interest 12,227 12,227 7,676 (4,551) Miscellaneous Revenue 2,679 2,679 10,000 7,321 Total Revenues 224,825 224,825 201,187 (23,638) Expenditures General Government 90,927 115,927 92,113 23,814 Total Expenditures 90,927 115,927 92,113 23,814 Excess (Deficiency) of Revenue over Expenditures 133,898 108,898 109,074 176 Other Financing Sources (Uses) Transfers (Out) (47,674) (47,674) (47,674) - Total Other Financing Sources (Uses) (47,674) (47,674) (47,674) - Net Change in Fund Balance 86,224 61,224 61,400 176 Fund Balance, January 1 657,558 614,840 614,840 - Fund Balance, December 31 743,782 $ 676,064 $ 676,240 $ 176 $ See the accompanying independent auditors' report. CITY OF LAFAYETTE, COLORADO BUDGETARY COMPARISON SCHEDULE LAFAYETTE URBAN RENEWAL AUTHORITY For the Fiscal Year Ended December 31, 2010 84 ---PAGE BREAK--- CITY OF LAFAYETTE NOTE TO REQUIRED SUPPLEMENTARY INFORMATION December 31, 2010 NOTE 1 BUDGETS AND BUDGETARY ACCOUNTING The City follows these procedures in establishing the budgetary data reflected in the financial statements. On or before September 20, the City Administrator submits to the City Council a proposed budget for the subsequent fiscal year commencing January 1. This budget includes proposed expenditures and the means of financing them. The budget is presented at the fund level, but includes supporting schedules presented at the sub-object (or account) level. The City uses generally accepted accounting principals (GAAP) as the basis for budgeting revenues and expenditures for all funds except for proprietary funds. In the proprietary funds, capital outlay and debt principal payments are budgeted but depreciation is not budgeted. A Public Hearing on the proposed budget is held before its final adoption to obtain any comments from citizens. On or before the last Thursday in October for the ensuing year, the budget is legally enacted through the adoption of an appropriation ordinance at the fund level. Budget revisions occur at the fund level and may only be made through Council Ordinance. The City Administrator may re-allocate the budget between Departments. Department Heads, with the approval of the City Administrator and Finance Director, may re-allocate the total budget within a Department. The City Council may make additional appropriations during the fiscal year for unanticipated revenues received by the City. Such appropriations are approved on a consensus basis by the City Council throughout the year. After October 1 of the fiscal year, all previous appropriations amendments are formally adopted at the fund level by ordinance. All appropriations, except for capital projects, lapse at year-end. Any unspent appropriations may be carried forward to the subsequent budget year with the approval of a budget amendment by City Council. Capital projects appropriations are automatically carried forward until completion of the projects. 85 ---PAGE BREAK--- COMBINING AND INDIVIDUAL FUND STATEMENTS AND SCHEDULES FINANCIAL SECTION This section consists of the following:  Nonmajor Governmental Funds  Internal Service Funds  Budgetary Comparison Schedules 2010 86 ---PAGE BREAK--- CITY OF LAFAYETTE, COLORADO NONMAJOR GOVERNMENTAL FUNDS December 31, 2010 Special Revenue Funds Special Revenue Funds are used to account for specific revenue sources that are legally restricted to expenditures for specific purposes. Following are the special revenue funds included in this section: • Ambulance and Fire Fund • Lafayette City Center General Improvement District • Exempla General Improvement District • Lafayette Corporate Campus General Improvement District • Lafayette Tech Center General Improvement District Capital Projects Funds The Capital Projects Funds are used to account for the acquisition of construction of major capital facilities other than those financed by proprietary fund types. The City’s Capital Projects Funds account for the following capital projects included in this section. • Storm Drainage Fund To account for fees collected on new residential construction and commercial development through the building permit process and expenditures related to the expansion of the City’s storm drainage system due to the development of property within the City. • Legacy Open Space Fund To account for sales and use taxes collected for the acquisition and maintenance of open space. • Parks, Open Space, & Trails (POST) Fund To account for sales and use taxes collected for the acquisition, development, and maintenance of parks and open space. • Conservation Trust Fund To account for the accumulation of monies received annually from the proceeds of the Colorado State Lottery. Expenditures related to the maintenance of existing parks and recreation infrastructure are recorded in this fund. 87 ---PAGE BREAK--- CITY OF LAFAYETTE, COLORADO NONMAJOR GOVERNMENTAL FUNDS December 31, 2010 Debt Service Fund The Debt Service Fund is used to account for the accumulation of resources and payment of bond principal and interest from governmental resources. The City’s Debt Service Fund accounts for the following issues:  Revenue Bonds: Sales and Use Tax Refunding Bonds, Series 2003 ($6,360,000) – to accumulate monies for the payment of these bonds, financed solely by sales and use tax revenues. These bonds are due in annual installments plus interest, until maturity in 2011.  Fire/Library Bonds: General Obligation Fire/Library Bonds, Series 1998 ($4,695,000) – to accumulate monies for the payment of these bonds, financed by general ad valorem taxes levied against all taxable property within the City. These bonds are due in annual installments plus interest, until maturity in 2017.  Police Bonds: General Obligation Bonds, Series 2005 ($6,000,000) – financed by general ad valorem taxes levied against all taxable property within the City. The bond principal is due annually, including interest (paid semi-annually) until maturity in 2025.  Revenue Bonds: Sales and Use Tax Revenue Bonds, Series 2008 ($6,910,000) – financed by sales and use tax revenues for the replacement of streets and roads and an addition to the recreation center. The bond principal is due annually, including interest (paid semi- annually) until maturity in 2019.  Capital Leases: The Debt Service Fund also accounts for Capital Leases on the Sister Carmen building, recycling carts, a fire truck, and energy improvements. Cemetery Endowment Fund The Cemetery Endowment Fund is a permanent fund used to separately account for an endowment care trust that occurred prior to the City acquiring ownership in the Coal Creek Cemetery. 88 ---PAGE BREAK--- Special Capital Debt Cemetery Revenue Projects Service Endowment Funds Funds Fund Fund Total Assets Cash and Investments 4,140,671 $ 2,624,609 $ 67,156 $ 219 $ 6,832,655 $ Accrued Interest Receivable 15,418 10,333 333 104 26,188 Accounts Receivable 8,409 - 105 - 8,514 Property Taxes Receivable 2,211,685 - 602,569 - 2,814,254 Restricted Cash and Investments 1,090,500 - - 46,398 1,136,898 Special Assessments Receivable 439,400 - - - 439,400 Total Assets 7,906,083 $ 2,634,942 $ 670,163 $ 46,721 $ 11,257,909 $ Liabilities and Fund Balance Liabilities Accounts Payable 231,796 $ 413,334 $ - $ - $ 645,130 $ Accrued Liabilities 4,235 - - - 4,235 Deposits Payable 75,000 - - - 75,000 Deferred Revenues 2,651,085 - 602,569 - 3,253,654 Total Liabilities 2,962,116 413,334 602,569 - 3,978,019 Fund Balance Resources Not in Spendable Form - - - 46,398 46,398 Restricted 4,258,838 1,038,470 - - 5,297,308 Assigned 685,129 1,183,138 67,594 323 1,936,184 Total Fund Balance 4,943,967 2,221,608 67,594 46,721 7,279,890 Total Liabilities and Fund Balance 7,906,083 $ 2,634,942 $ 670,163 $ 46,721 $ 11,257,909 $ See the accompanying independent auditors' report. CITY OF LAFAYETTE, COLORADO COMBINING BALANCE SHEET NONMAJOR GOVERNMENTAL FUNDS December 31, 2010 89 ---PAGE BREAK--- Special Capital Debt Cemetery Revenue Projects Service Endowment Funds Funds Fund Fund Total Revenues Taxes Property Tax 2,211,746 $ - $ 852,428 $ - $ 3,064,174 $ Specific Ownership Tax 104,229 - - - 104,229 Building Use Tax - 70,604 27,376 - 97,980 Vehicle Use Tax - 157,466 115,850 - 273,316 General Sales Tax - 1,218,524 896,162 - 2,114,686 Total Taxes 2,315,975 1,446,594 1,891,816 - 5,654,385 Intergovernmental - State Grants - 221,666 - - 221,666 Assessment - Interest 495,878 - - - 495,878 Interest 44,083 25,006 11,230 323 80,642 Administrative Fee 15,000 - - - 15,000 Contributions and Misc Grants - 11,200 - - 11,200 Miscellaneous 988 - - 46,398 47,386 Total Revenues 2,871,924 1,704,466 1,903,046 46,721 6,526,157 Expenditures General Government 781,101 48,186 44,979 - 874,266 Public Safety 250,703 - - - 250,703 Public Works - 5,315 - - 5,315 Cultural and Recreation - 87,737 - - 87,737 Capital Outlay 271,726 761,301 - - 1,033,027 Debt Service Capital Lease and Loan Payments - - 539,659 - 539,659 Principal 120,000 - 1,325,000 - 1,445,000 Interest and Fiscal Charges 442,375 - 545,782 - 988,157 Total Expenditures 1,865,905 902,539 2,455,420 - 5,223,864 Excess (Deficiency) of Revenues over Expenditures 1,006,019 801,927 (552,374) 46,721 1,302,293 Other Financing Sources (Uses) Transfers In - - 539,659 - 539,659 Transfers (Out) (334,242) (776,694) - - (1,110,936) Total Other Financing Sources (Uses) (334,242) (776,694) 539,659 - (571,277) Net Change in Fund Balance 671,777 25,233 (12,715) 46,721 731,016 Fund Balance, January 1 4,272,190 2,196,375 80,309 - 6,548,874 Fund Balance, December 31 4,943,967 $ 2,221,608 $ 67,594 $ 46,721 $ 7,279,890 $ See the accompanying independent auditors' report. CITY OF LAFAYETTE, COLORADO COMBINING STATEMENT OF REVENUES, EXPENDITURES, AND CHANGES IN FUND BALANCES - NONMAJOR GOVERNMENTAL FUNDS For the Fiscal Year Ended December 31, 2010 90 ---PAGE BREAK--- Lafayette Lafayette Lafayette Ambulance City Center Exempla Corp Campus Tech Center and Fire GID GID GID GID Total Assets Cash and Investments 1,677,797 $ 90,056 $ 1,997,127 $ 365,388 $ 10,303 $ 4,140,671 $ Accrued Interest Receivable 4,249 421 9,052 1,646 50 15,418 Accounts Receivable 6,313 303 274 921 598 8,409 Property Taxes Receivable 1,643,370 86,359 71,179 247,731 163,046 2,211,685 Restricted Cash and Investments - - 1,090,500 - - 1,090,500 Special Assessments Receivable - - 329,550 109,850 - 439,400 Total Assets 3,331,729 $ 177,139 $ 3,497,682 $ 725,536 $ 173,997 $ 7,906,083 $ Liabilities and Fund Balance Liabilities Accounts Payable - $ - $ 231,796 $ - $ - $ 231,796 $ Deposits Payable - 75,000 - - - 75,000 Accrued Liabilities 4,235 - - - - 4,235 Deferred Revenues 1,643,370 86,359 400,729 357,581 163,046 2,651,085 Total Liabilities 1,647,605 161,359 632,525 357,581 163,046 2,962,116 Fund Balance Restricted 1,662,048 - 2,285,196 302,731 8,863 4,258,838 Assigned 22,077 15,780 579,960 65,224 2,088 685,129 Total Fund Balance 1,684,125 15,780 2,865,156 367,955 10,951 4,943,967 Total Liabilities and Fund Balance 3,331,730 $ 177,139 $ 3,497,681 $ 725,536 $ 173,997 $ 7,906,083 $ See the accompanying independent auditors' report. CITY OF LAFAYETTE, COLORADO COMBINING BALANCE SHEET NONMAJOR SPECIAL REVENUE FUNDS December 31, 2010 91 ---PAGE BREAK--- Lafayette Lafayette Lafayette Ambulance City Center Exempla Corp Campus Tech Center and Fire GID GID GID GID Total Revenues Property Taxes 1,649,240 $ 80,991 $ 73,581 $ 246,221 $ 161,713 $ 2,211,746 $ Specific Ownership Taxes 77,876 3,809 3,447 11,581 7,516 104,229 Total Taxes 1,727,116 84,800 77,028 257,802 169,229 2,315,975 Assessment - Interest - - 495,878 - - 495,878 Interest 14,058 1,475 23,047 4,951 552 44,083 Charges for Services - - 15,000 - - 15,000 Miscellaneous Revenue - - 988 - - 988 Total Revenues 1,741,174 86,275 611,941 262,753 169,781 2,871,924 Expenditures Current General Government 20,574 9,215 726,393 13,993 10,926 781,101 Public Safety 250,703 - - - - 250,703 Capital Outlay 271,726 - - - - 271,726 Debt Service Principal - 45,000 - 45,000 30,000 120,000 Interest and Fiscal Charges - 32,775 86,400 200,800 122,400 442,375 Total Expenditures 543,003 86,990 812,793 259,793 163,326 1,865,905 Excess (Deficiency) of Revenues over Expenditures 1,198,171 (715) (200,852) 2,960 6,455 1,006,019 Other Financing Sources (Uses) Transfers (Out) (334,242) - - - - (334,242) Total Other Financeing Sources (Uses) (334,242) - - - - (334,242) Net Change in Fund Balance 863,929 (715) (200,852) 2,960 6,455 671,777 Fund Balance, January 1 820,196 16,495 3,066,008 364,995 4,496 4,272,190 Fund Balance, December 31 1,684,125 $ 15,780 $ 2,865,156 $ 367,955 $ 10,951 $ 4,943,967 $ See the accompanying independent auditors' report. CITY OF LAFAYETTE, COLORADO COMBINING STATEMENT OF REVENUES, EXPENDITURES, AND CHANGES IN FUND BALANCES - NONMAJOR SPECIAL REVENUE FUNDS For the fiscal year ended December 31, 2010 92 ---PAGE BREAK--- Original Final Budget Budget Actual Variance Revenues Property Taxes 1,637,966 $ 1,637,966 $ 1,649,240 $ 11,274 $ Specific Ownership Taxes 60,000 60,000 77,876 17,876 Interest 8,000 8,000 14,058 6,058 Total Revenue 1,705,966 1,705,966 1,741,174 35,208 Expenditures Current General Government 20,462 34,319 20,574 13,745 Public Safety 227,854 237,762 250,703 (12,941) Capital Outlay 434,500 434,500 271,726 162,774 Total Expenditures 682,816 706,581 543,003 163,578 Excess (Deficiency) of Revenues over Expenditures 1,023,150 999,385 1,198,171 198,786 Other Financing Sources (Uses) Transfers (Out) (572,988) (627,150) (334,242) 292,908 Total Other Financeing Sources (Uses) (572,988) (627,150) (334,242) 292,908 Net Change in Fund Balance 450,162 372,235 863,929 491,694 Fund Balance, January 1 862,647 820,196 820,196 - Fund Balance, December 31 1,312,809 $ 1,192,431 $ 1,684,125 $ 491,694 $ See the accompanying independent auditors' report. CITY OF LAFAYETTE, COLORADO BUDGETARY COMPARISON SCHEDULE AMBULANCE AND FIRE SPECIAL REVENUE FUND For the fiscal year ended December 31, 2010 93 ---PAGE BREAK--- Original Final Budget Budget Actual Variance Revenues Property Taxes 80,990 $ 80,990 $ 80,991 $ 1 $ Specific Ownership Taxes 5,100 5,100 3,809 (1,291) Interest 2,000 2,000 1,475 (525) Total Revenue 88,090 88,090 86,275 (1,815) Expenditures Current General Government 10,315 10,315 9,215 1,100 Debt Service Principal 45,000 45,000 45,000 - Interest and Fiscal Charges 32,775 32,775 32,775 - Total Expenditures 88,090 88,090 86,990 1,100 Net Change in Fund Balance - - (715) (715) Fund Balance, January 1 20,581 16,495 16,495 - Fund Balance, December 31 20,581 $ 16,495 $ 15,780 $ (715) $ See the accompanying independent auditors' report. CITY OF LAFAYETTE, COLORADO BUDGETARY COMPARISON SCHEDULE LAFAYETTE CITY CENTER GID SPECIAL REVENUE FUND For the fiscal year ended December 31, 2010 94 ---PAGE BREAK--- Original Final Budget Budget Actual Variance Revenues Property Taxes 72,595 $ 72,595 $ 73,581 $ 986 $ Specific Ownership Taxes 4,000 4,000 3,447 (553) Assessment Interest 144,358 144,358 495,878 351,520 Interest 40,000 40,000 23,047 (16,953) Charges for Services 15,000 15,000 15,000 - Miscellanous Revenue 1,544 1,544 988 (556) Total Revenue 277,497 277,497 611,941 334,444 Expenditures Current General Government 27,633 719,253 726,393 (7,140) Debt Service Interest and Fiscal Charges 144,358 144,358 86,400 57,958 Total Expenditures 171,991 863,611 812,793 50,818 Net Change in Fund Balance 105,506 (586,114) (200,852) 385,262 Fund Balance, January 1 3,065,744 3,066,008 3,066,008 - Fund Balance, December 31 3,171,250 $ 2,479,894 $ 2,865,156 $ 385,262 $ See the accompanying independent auditors' report. CITY OF LAFAYETTE, COLORADO BUDGETARY COMPARISON SCHEDULE EXEMPLA GID SPECIAL REVENUE FUND For the fiscal year ended December 31, 2010 95 ---PAGE BREAK--- Original Final Budget Budget Actual Variance Revenues Property Taxes 246,179 $ 246,179 $ 246,221 $ 42 $ Specific Ownership Taxes 10,314 10,314 11,581 1,267 Interest 4,500 4,500 4,951 451 Total Revenue 260,993 260,993 262,753 1,760 Expenditures Current General Government 15,193 15,193 13,993 1,200 Debt Service Principal 45,000 45,000 45,000 - Interest and Fiscal Charges 200,800 200,800 200,800 - Total Expenditures 260,993 260,993 259,793 1,200 Net Change in Fund Balance - - 2,960 2,960 Fund Balance, January 1 363,346 364,995 364,995 - Fund Balance, December 31 363,346 $ 364,995 $ 367,955 $ 2,960 $ See the accompanying independent auditors' report. CITY OF LAFAYETTE, COLORADO BUDGETARY COMPARISON SCHEDULE LAFAYETTE CORPORATE CAMPUS GID SPECIAL REVENUE FUND For the fiscal year ended December 31, 2010 96 ---PAGE BREAK--- Original Final Budget Budget Actual Variance Revenues Property Taxes 159,797 $ 159,797 $ 161,713 $ 1,916 $ Specific Ownership Taxes 5,000 5,000 7,516 2,516 Interest - - 552 552 Total Revenue 164,797 164,797 169,781 4,984 Expenditures Current General Government 12,397 12,397 10,926 1,471 Debt Service Principal 30,000 30,000 30,000 - Interest and Fiscal Charges 122,400 122,400 122,400 - Total Expenditures 164,797 164,797 163,326 1,471 Net Change in Fund Balance - - 6,455 6,455 Fund Balance, January 1 1,011 4,496 4,496 - Fund Balance, December 31 1,011 $ 4,496 $ 10,951 $ 6,455 $ See the accompanying independent auditors' report. CITY OF LAFAYETTE, COLORADO BUDGETARY COMPARISON SCHEDULE LAFAYETTE TECH CENTER GID SPECIAL REVENUE FUND For the fiscal year ended December 31, 2010 97 ---PAGE BREAK--- Parks, Storm Legacy Open Space, Conservation Drainage Open Space and Trails Trust Total Assets Cash and Investments - $ 782,371 $ 1,634,079 $ 208,159 $ 2,624,609 $ Accrued Interest Receivable - 1,719 7,664 950 10,333 Total Assets - $ 784,090 $ 1,641,743 $ 209,109 $ 2,634,942 $ Liabilities and Fund Balance Liabilities Accounts Payable - $ 393,334 $ - $ 20,000 $ 413,334 $ Total Liabilities - 393,334 - 20,000 413,334 Fund Balance Resticted - 322,117 527,244 189,109 1,038,470 Assigned - 68,639 1,114,499 - 1,183,138 Total Fund Balance - 390,756 1,641,743 189,109 2,221,608 Total Liabilities and Fund Balance - $ 784,090 $ 1,641,743 $ 209,109 $ 2,634,942 $ See the accompanying independent auditors' report. CITY OF LAFAYETTE, COLORADO COMBINING BALANCE SHEET NONMAJOR CAPITAL PROJECT FUNDS December 31, 2010 98 ---PAGE BREAK--- Parks, Storm Legacy Open Space, Conservation Drainage Open Space and Trails Trust Total Revenues Taxes Building Use Tax - $ 35,302 $ 35,302 $ - $ 70,604 $ Vehicle Use Tax - 78,733 78,733 - 157,466 General Sales & Use Tax - 609,262 609,262 - 1,218,524 Total Taxes - 723,297 723,297 - 1,446,594 Intergovernmental - State Grants - - - 221,666 221,666 Interest 1,985 4,170 17,011 1,840 25,006 Contributions and Misc Grants - - 11,200 - 11,200 Total Revenues 1,985 727,467 751,508 223,506 1,704,466 Expenditures Current General Government - 3,937 44,249 - 48,186 Public Works 5,315 - - - 5,315 Cultural & Recreation - 63,910 - 23,827 87,737 Capital Outlay 130,137 333,333 72,909 224,922 761,301 Total Expenditures 135,452 401,180 117,158 248,749 902,539 Excess (Deficiency) of Revenues over Expenditures (133,467) 326,287 634,350 (25,243) 801,927 Other Financing Sources (Uses) Transfers (Out) - - (776,694) - (776,694) Total Other Financeing Sources (Uses) - - (776,694) - (776,694) Net Change in Fund Balance (133,467) 326,287 (142,344) (25,243) 25,233 Fund Balance, January 1 133,467 64,469 1,784,087 214,352 2,196,375 Fund Balance, December 31 - $ 390,756 $ 1,641,743 $ 189,109 $ 2,221,608 $ See the accompanying independent auditors' report. CITY OF LAFAYETTE, COLORADO COMBINING STATEMENT OF REVENUES, EXPENDITURES, AND CHANGES IN FUND BALANCES - NONMAJOR CAPITAL PROJECT FUNDS For the fiscal year ended December 31, 2010 99 ---PAGE BREAK--- Original Final Budget Budget Actual Variance Revenues Interest 5,000 $ 5,000 $ 1,985 $ (3,015) $ Total Revenues 5,000 5,000 1,985 (3,015) Expenditures Current Public Works - - 5,315 (5,315) Capital Outlay 250,000 135,452 130,137 5,315 Total Expenditures 250,000 135,452 135,452 - Net Change in Fund Balance (245,000) (130,452) (133,467) (3,015) Fund Balance, January 1 245,623 133,467 133,467 - Fund Balance, December 31 623 $ 3,015 $ - $ (3,015) $ See the accompanying independent auditors' report. CITY OF LAFAYETTE, COLORADO BUDGETARY COMPARISON SCHEDULE STORM DRAINAGE CAPITAL PROJECT FUND For the fiscal year ended December 31, 2010 100 ---PAGE BREAK--- Original Final Budget Budget Actual Variance Revenues Taxes Building Use Tax 4,681 $ 4,681 $ 35,302 $ 30,621 $ Vehicle Use Tax 61,553 61,553 78,733 17,180 General Sales & Use Tax 563,404 563,404 609,262 45,858 Total Taxes 629,638 629,638 723,297 93,659 Interest 2,000 2,000 4,170 2,170 Total Revenues 631,638 631,638 727,467 95,829 Expenditures Current General Government 3,078 3,078 3,937 (859) Culture & Recreation - - 63,910 (63,910) Capital Outlay 465,063 465,063 333,333 131,730 Total Expenditures 468,141 468,141 401,180 66,961 Net Change in Fund Balance 163,497 163,497 326,287 162,790 Fund Balance, January 1 2,137 64,469 64,469 - Fund Balance, December 31 165,634 $ 227,966 $ 390,756 $ 162,790 $ See the accompanying independent auditors' report. CITY OF LAFAYETTE, COLORADO BUDGETARY COMPARISON SCHEDULE LEGACY OPEN SPACE CAPITAL PROJECT FUND For the fiscal year ended December 31, 2010 101 ---PAGE BREAK--- Original Final Budget Budget Actual Variance Revenues Taxes Building Use Tax 4,681 $ 4,681 $ 35,302 $ 30,621 $ Vehicle Use Tax 61,553 61,553 78,733 17,180 General Sales & Use Tax 563,404 563,404 609,262 45,858 Total Taxes 629,638 629,638 723,297 93,659 Interest 30,000 30,000 17,011 (12,989) Contributions and Misc Grants - - 11,200 11,200 Total Revenues 659,638 659,638 751,508 91,870 Expenditures Current General Government 3,078 3,078 44,249 (41,171) Capital Outlay 35,000 285,000 72,909 212,091 Total Expenditures 38,078 288,078 117,158 170,920 Excess (Deficiency) of Revenues over Expenditures 621,560 371,560 634,350 262,790 Other Financing Sources (Uses) Transfers Out (909,489) (914,589) (776,694) 137,895 Total Other Financing Sources (Uses) (909,489) (914,589) (776,694) 137,895 Net Change in Fund Balance (287,929) (543,029) (142,344) 400,685 Fund Balance, January 1 1,369,224 1,784,087 1,784,087 - Fund Balance, December 31 1,081,295 $ 1,241,058 $ 1,641,743 $ 400,685 $ See the accompanying independent auditors' report. CITY OF LAFAYETTE, COLORADO BUDGETARY COMPARISON SCHEDULE PARKS, OPEN SPACE, AND TRAILS CAPITAL PROJECT FUND For the fiscal year ended December 31, 2010 102 ---PAGE BREAK--- Original Final Budget Budget Actual Variance Revenues Intergovernmental - State Grants 211,000 $ 211,000 $ 221,666 $ 10,666 $ Interest 2,000 2,000 1,840 (160) Total Revenues 213,000 213,000 223,506 10,506 Expenditures Current Cultural and Recreation - 5,625 23,827 (18,202) Capital Outlay 210,000 347,400 224,922 122,478 Total Expenditures 210,000 353,025 248,749 104,276 Net Change in Fund Balance 3,000 (140,025) (25,243) 114,782 Fund Balance, January 1 13,785 214,352 214,352 - Fund Balance, December 31 16,785 $ 74,327 $ 189,109 $ 114,782 $ See the accompanying independent auditors' report. CITY OF LAFAYETTE, COLORADO BUDGETARY COMPARISON SCHEDULE CONSERVATION TRUST CAPITAL PROJECT FUND For the fiscal year ended December 31, 2010 103 ---PAGE BREAK--- Original Final Budget Budget Actual Variance Revenues Interest 40,000 $ 40,000 $ 31,001 $ (8,999) $ Miscellaneous - - 145,274 145,274 Total Revenues 40,000 40,000 176,275 136,275 Expenditures Current Public Works - - 734,630 (734,630) Capital Outlay Capital Budget Carryover 2,000,000 3,365,786 2,540,310 825,476 Total Expenditures 2,000,000 3,365,786 3,274,940 90,846 Excess (Deficiency) of Revenues over Expenditures (1,960,000) (3,325,786) (3,098,665) 227,121 Other Financing Sources (Uses) Transfers Out - (67,513) (36,733) 30,780 Total Other Financing Sources (Uses) - (67,513) (36,733) 30,780 Net Change in Fund Balance (1,960,000) (3,393,299) (3,135,398) 257,901 Fund Balance, January 1 2,697,160 3,708,650 3,708,650 Fund Balance, December 31 737,160 $ 315,351 $ 573,252 $ 257,901 $ CITY OF LAFAYETTE, COLORADO BUDGETARY COMPARISON SCHEDULE CAPITAL PROJECTS CAPITAL PROJECT FUND For the fiscal year ended December 31, 2010 104 ---PAGE BREAK--- Original Final Budget Budget Actual Variance Revenues Property Tax 851,369 $ 851,369 $ 852,428 $ 1,059 $ Building Use Tax 12,824 12,824 27,376 14,552 Vehicle Use Tax 531,084 531,084 115,850 (415,234) General Sales & Use Tax 489,959 489,959 896,162 406,203 Interest 10,000 10,000 11,230 1,230 Total Revenues 1,895,236 1,895,236 1,903,046 7,810 Expenditures Current General Government 24,454 44,454 44,979 (525) Debt Service Capital Lease Payments 375,074 559,404 539,659 19,745 Bond Principal 1,325,000 1,325,000 1,325,000 - Bond Interest and Fiscal Charges 545,782 545,782 545,782 - Total Expenditures 2,270,310 2,474,640 2,455,420 19,220 Excess (Deficiency) of Revenue over Expenditures (375,074) (579,404) (552,374) 27,030 Other Financing Sources (Uses) Transfers In 375,074 559,404 539,659 (19,745) Total Other Financing Sources (Uses) 375,074 559,404 539,659 (19,745) Net Change in Fund Balance - (20,000) (12,715) 7,285 Fund Balance, January 1 69,886 80,309 80,309 - Fund Balance, December 31 69,886 $ 60,309 $ 67,594 $ 7,285 $ See the accompanying independent auditors' report. CITY OF LAFAYETTE, COLORADO BUDGETARY COMPARISON SCHEDULE DEBT SERVICE FUND For the Fiscal Year Ended December 31, 2010 105 ---PAGE BREAK--- Original Final Budget Budget Actual Variance Revenues Interest - $ - $ 323 $ 323 $ Miscellaneous - - 46,398 46,398 Total Revenues - - 46,721 46,721 Net Change in Fund Balance - - 46,721 46,721 Fund Balance, January 1 - - - - Fund Balance, December 31 - $ - $ 46,721 $ 46,721 $ See the accompanying independent auditors' report. CITY OF LAFAYETTE, COLORADO BUDGETARY COMPARISON SCHEDULE CEMETERY ENDOWMENT FUND For the Fiscal Year Ended December 31, 2010 106 ---PAGE BREAK--- CITY OF LAFAYETTE, COLORADO INTERNAL SERVICE FUNDS December 31, 2010 Internal Service Funds are used to account for the financing of goods or services provided by one department or agency to other departments or agencies of the governmental unit, or to other governmental units, on a cost-reimbursement basis. The City’s Internal Service Funds account for the following services: Employee Benefit Fund To account for the allocation of costs associated with employee insurance plans. Insurance Fund To account for the allocation of costs associated with the City’s insurance plans. 107 ---PAGE BREAK--- Employee Benefit Insurance Fund Fund Total Assets Current Assets Cash and Investments 593,500 $ 762,427 $ 1,355,927 $ Accrued Interest Receivable 2,527 3,235 5,762 Prepaid Items 164,421 14,650 179,071 Total Current Assets 760,448 780,312 1,540,760 Liabilities Current Liabilities Accounts Payable 380 6,707 7,087 Claims Payable 23,053 15,770 38,823 Compensated Absences Due in One Year 476,075 - 476,075 Total Current Liabilities 499,508 22,477 521,985 Net Assets - Unrestricted 260,940 $ 757,835 $ 1,018,775 $ See the accompanying independent auditors' report. CITY OF LAFAYETTE, COLORADO COMBINING STATEMENT OF NET ASSETS INTERNAL SERVICE FUNDS December 31, 2010 108 ---PAGE BREAK--- Employee Benefit Insurance Fund Fund Total Operating Revenues City Contributions 1,967,094 $ 500,991 $ 2,468,085 $ Miscellaneous 131,096 21,997 153,093 Total Operating Revenue 2,098,190 522,988 2,621,178 Operating Expenses Premiums and Claims Paid 1,984,060 456,306 2,440,366 Wellness Program 3,165 12,668 15,833 Miscellaneous 125,901 - 125,901 Total Operating Expenses 2,113,126 468,974 2,582,100 Operating Income (Loss) (14,936) 54,014 39,078 Nonoperating Interest Revenue 4,778 6,849 11,627 Change in Net Assets (10,158) 60,863 50,705 Total Net Assets, January 1 271,098 696,972 968,070 Total Net Assets, December 31 260,940 $ 757,835 $ 1,018,775 $ See the accompanying independent auditors' report. CITY OF LAFAYETTE, COLORADO CHANGES IN FUND NET ASSETS INTERNAL SERVICE FUNDS For the fiscal year ended December 31, 2010 COMBINING STATEMENT OF REVENUES, EXPENSES, AND 109 ---PAGE BREAK--- Employee Benefit Insurance Fund Fund Total Cash Flows From Operating Activities Receipts from General and Proprietary Funds 1,967,094 $ 500,991 $ 2,468,085 $ Miscellaneous Receipts - COBRA and Other 131,096 21,997 153,093 Payments to Insurance Companies (1,978,530) (465,529) (2,444,059) Payments for Wellness Program (3,165) (12,668) (15,833) Payments to Employees (134,604) - (134,604) Net Cash Provided (Used) by Operating Activities (18,109) 44,791 26,682 Cash flows From Investing Activities Interest Received 5,691 7,661 13,352 Net Cash Provided By Investing Activities 5,691 7,661 13,352 Net Increase (Decrease) in Cash and Investments (12,418) 52,452 40,034 Cash and Investments - January 1 605,918 709,975 1,315,893 Cash and Investments - December 31 593,500 $ 762,427 $ 1,355,927 $ Reconciliation of Operating Income (Loss) to Net Cash Provided (Used) by Operating Activities: Operating Income(Loss) (14,936) $ 54,014 $ 39,078 $ Adjustments to Reconcile Income (Loss) From Operating Activities (Increase) Decrease in Accounts Receivable - 745 745 (Increase) Decrease in Prepaid Expense (4,225) (14,650) (18,875) Increase (Decrease) in Accounts and Claims Payable 9,755 4,682 14,437 Increase (Decrease) in Compensated Absences (8,703) - (8,703) Total Adjustments (3,173) (9,223) (12,396) Net Cash Provided (Used) by Operating Activities (18,109) $ 44,791 $ 26,682 $ See the accompanying independent auditors' report. Operations to Net Cash Provided (Used) by CITY OF LAFAYETTE, COLORADO INTERNAL SERVICE FUNDS For the fiscal year ended December 31, 2010 COMBINING STATEMENT OF CASH FLOWS 110 ---PAGE BREAK--- Original Final Budget Budget Actual Variance Revenues City Contributions 1,819,938 $ 1,819,938 $ 1,967,094 $ 147,156 $ Interest Income 10,000 10,000 4,778 (5,222) Miscellaneous Income 25,000 25,000 131,096 106,096 Total Revenues 1,854,938 1,854,938 2,102,968 248,030 Expenditures Premiums Paid 1,920,910 1,981,910 1,984,060 (2,150) Wellness Program 15,000 15,000 3,165 11,835 Miscellaneous 35,000 116,500 125,901 (9,401) Total Expenditures 1,970,910 2,113,410 2,113,126 284 Excess (Deficiency) of Revenue over Expenditures (115,972) (258,472) (10,158) 248,314 Total Net Assets, January 1 302,351 271,098 271,098 - Total Net Assets, December 31 186,379 $ 12,626 $ 260,940 $ 248,314 $ See the accompanying independent auditors' report. CITY OF LAFAYETTE, COLORADO BUDGETARY COMPARISON SCHEDULE EMPLOYEE BENEFIT FUND For the Fiscal Year Ended December 31, 2010 111 ---PAGE BREAK--- Original Final Budget Budget Actual Variance Revenues City Contributions 500,991 $ 500,991 $ 500,991 $ - $ Interest Income 10,000 10,000 6,849 (3,151) Miscellaneous Income 26,000 26,000 21,997 (4,003) Total Revenues 536,991 536,991 529,837 (7,154) Expenditures Premiums Paid 530,991 565,991 456,306 109,685 Wellness Program 6,000 6,000 12,668 (6,668) Total Expenditures 536,991 571,991 468,974 103,017 Excess (Deficiency) of Revenue over Expenditures - (35,000) 60,863 95,863 Total Net Assets, January 1 647,024 696,972 696,972 - Total Net Assets, December 31 647,024 $ 661,972 $ 757,835 $ 95,863 $ See the accompanying independent auditors' report. For the Fiscal Year Ended December 31, 2010 CITY OF LAFAYETTE, COLORADO BUDGETARY COMPARISON SCHEDULE INSURANCE FUND 112 ---PAGE BREAK--- Original Final Budget Budget Actual Variance Revenues Metered Water Sales 4,549,565 $ 4,549,565 $ 4,869,976 $ 320,411 $ Interest Revenue 520,000 520,000 263,002 (256,998) Other 111,000 111,000 64,626 (46,374) Payment in Lieu of Water 321,344 321,344 496,315 174,971 Tap Fees 1,583,062 1,583,062 1,573,542 (9,520) Total Revenues 7,084,971 7,084,971 7,267,461 182,490 Expenditures Administration 338,587 625,485 373,443 252,042 Source of Water Supply 454,156 454,893 329,879 125,014 Water Treatment 1,354,698 1,360,231 1,592,585 (232,354) Water Transmission and Distribution 646,896 637,925 701,959 (64,034) Construction and Capital Improvements 2,764,000 2,818,486 1,027,589 1,790,897 Debt Service Principal Retirement 683,229 1,468,229 1,468,229 - Interest Expense 851,931 851,931 863,631 (11,700) Bond Fee 1,900 1,900 4,875 (2,975) Amortization 44,204 44,204 40,416 3,788 Transfers to Other Funds 709,968 709,968 727,477 (17,509) Total Expenditures 7,849,569 8,973,252 7,130,083 1,843,169 Excess (Deficiency) of Revenue over Expenditures (764,598) $ (1,888,281) $ 137,378 2,025,659 $ Total Net Assets, January 1 78,617,839 Total Net Assets, December 31 78,755,217 GAAP Adjustments Depreciation (1,576,530) Principal Retirement 1,468,229 Construction and Capital Improvements 1,027,589 Developer Dedications 196,000 Adjusted Total Net Assets, December 31 79,870,505 $ See the accompanying independent auditors' report. CITY OF LAFAYETTE, COLORADO BUDGETARY COMPARISON SCHEDULE (NON-GAAP BUDGETARY BASIS) WATER UTILITY For the Fiscal Year Ended December 31, 2010 113 ---PAGE BREAK--- Original Final Budget Budget Actual Variance Revenues Waste Water Collection Fees 1,551,183 $ 1,551,183 $ 1,681,557 $ 130,374 $ Interest Revenue 86,985 86,985 44,065 (42,920) Tap Fees 856,180 856,180 868,023 11,843 Total Revenues 2,494,348 2,494,348 2,593,645 99,297 Expenditures Administration 177,461 177,461 185,977 (8,516) Waste Water Treatment 943,131 1,048,855 1,038,897 9,958 Waste Water Collection 382,342 462,555 473,312 (10,757) Construction and Capital Improvements 175,000 256,061 126,251 129,810 Loss on Disposal of Capital Assets - - 198 (198) Debt Service Principal Retirement 416,582 416,582 416,582 - Interest Expense 233,935 233,935 210,390 23,545 Bond Fee 1,400 1,400 - 1,400 Amortization 1,166 1,166 3,255 (2,089) Transfers to Other Funds 271,397 271,397 262,767 8,630 Total Expenditures 2,602,414 2,869,412 2,717,629 151,783 Excess (Deficiency) of Revenue over Expenditures (108,066) $ (375,064) $ (123,984) 251,080 $ Total Net Assets, January 1 21,386,091 Total Net Assets, December 31 21,262,107 GAAP Adjustments Depreciation (857,666) Principal Retirement 416,582 Construction and Capital Improvements 126,251 Adjusted Total Net Assets, December 31 20,947,274 $ See the accompanying independent auditors' report. CITY OF LAFAYETTE, COLORADO BUDGETARY COMPARISON SCHEDULE (NON-GAAP BUDGETARY BASIS) WATER RECLAMATION For the Fiscal Year Ended December 31, 2010 114 ---PAGE BREAK--- Original Final Budget Budget Actual Variance Revenues Golf Sales and Services 2,493,960 $ 2,493,960 $ 2,022,680 $ (471,280) $ Interest Revenue 7,000 7,000 1,742 (5,258) Other 15,000 15,000 8,926 (6,074) Transfer from General Fund - 92,225 - (92,225) Total Revenues 2,515,960 2,608,185 2,033,348 (574,837) Expenditures Administration 181,337 188,485 145,232 43,253 Golf Maintenance Operations 713,427 719,741 633,320 86,421 Golf Club House Operations 568,162 572,386 467,641 104,745 Golf Food Service Operations 243,136 245,171 197,791 47,380 Construction and Capital Improvements 113,679 113,679 23,134 90,545 Debt Service Principal 50,800 50,800 50,800 - Lease Principal 25,845 25,845 25,251 594 Interest Expense 15,580 15,580 16,172 (592) Transfers to Other Funds 592,773 684,998 560,358 124,640 Total Expenditures 2,504,739 2,616,685 2,119,699 496,986 Excess (Deficiency) of Revenue over Expenditures 11,221 $ (8,500) $ (86,351) (77,851) $ Total Net Assets, January 1 1,045,366 Total Net Assets, December 31 959,015 GAAP Adjustments Depreciation (173,453) Principal Retirement 76,051 Construction and Capital Improvements 23,134 Adjusted Total Net Assets, December 31 884,747 $ See the accompanying independent auditors' report. CITY OF LAFAYETTE, COLORADO GOLF COURSE For the Fiscal Year Ended December 31, 2010 BUDGETARY COMPARISON SCHEDULE (NON-GAAP BUDGETARY BASIS) 115 ---PAGE BREAK--- Original Final Budget Budget Actual Variance Revenues Storm Water Collection Fees 590,000 $ 590,000 $ 612,963 $ 22,963 $ Interest Revenue 30,000 30,000 17,733 (12,267) Other 4,000 4,000 - (4,000) Storm Water Development Fees 30,000 30,000 30,950 950 Total Revenues 654,000 654,000 661,646 7,646 Expenditures Administration 117,224 117,224 62,502 54,722 Storm Water Collection 239,623 243,055 212,163 30,892 Construction and Capital Improvements 1,145,000 1,145,000 499,550 645,450 Transfers to Other Funds 79,427 79,427 66,165 13,262 Total Expenditures 1,581,274 1,584,706 840,380 744,326 Excess (Deficiency) of Revenue over Expenditures (927,274) $ (930,706) $ (178,734) 751,972 $ Total Net Assets, January 1 1,830,848 Total Net Assets, December 31 1,652,114 GAAP Adjustments Depreciation (30,973) Construction and Capital Improvements 499,550 Adjusted Total Net Assets, December 31 2,120,691 $ See the accompanying independent auditors' report. CITY OF LAFAYETTE, COLORADO BUDGETARY COMPARISON SCHEDULE (NON-GAAP BUDGETARY BASIS) STORM WATER For the Fiscal Year Ended December 31, 2010 116 ---PAGE BREAK--- STATISTICAL SECTION For the year ended December 31, 2010, the Statistical Tables Section provides trends, statistical and demographic information, and continuing disclosure information. 2010 117 ---PAGE BREAK--- CITY OF LAFAYETTE, COLORADO COMPREHENSIVE ANNUAL FINANCIAL REPORT INDEX FOR THE STATISTICAL SECTION For the Fiscal Year Ended December 31, 2010 FINANCIAL TRENDS These schedules show the changes in the city’s financial position over time 119 REVENUE CAPACITY Schedules that assist in the assessment of the city’s local revenue sources. 131 DEBT CAPACITY These schedules aid in the analysis of the city’s current level of debt, and it’s ability to issue debt in the future. 135 DEMOGRAPHIC AND ECONOMIC INFORMATION Schedules containing indicators that depict the environment in which the city’s financial activities take place. 144 OPERATING INFORMATION Service and infrastructure data to help relate the financial information to the services and activities provided by the city. 145 118 ---PAGE BREAK--- 2001 2002 2003 2004 2005 Governmental activities Invested in capital assets, net of related debt 20,624,081 $ 11,299,168 $ 14,374,939 $ 22,570,911 $ 30,764,183 $ Restricted 4,917,165 3,547,614 10,033,284 10,776,990 6,720,920 Unrestricted 4,511,760 18,659,528 15,398,318 12,482,944 12,048,717 Total governmental activities net assets 30,053,006 33,506,310 39,806,541 45,830,845 49,533,820 Business-type activities Invested in capital assets, net of related debt 46,434,767 52,484,343 49,370,593 57,862,898 60,662,135 Restricted 6,451,664 2,551,168 9,493,472 - - Unrestricted 15,988,406 15,499,527 11,666,525 17,516,627 19,009,607 Total business-type activities net assets 68,896,687 70,535,038 70,530,590 75,379,525 79,671,607 Invested in capital assets, net of related debt 67,058,848 63,783,511 63,745,532 80,433,809 91,426,318 Restricted 11,368,829 6,098,782 19,526,756 10,776,990 6,720,920 Unrestricted 20,500,166 34,159,055 27,064,843 29,999,571 31,058,324 Total primary governmental net assets 98,927,843 $ 104,041,348 $ 110,337,131 $ 121,210,370 $ 129,205,427 $ Notes: The City of Lafayette implemented GASB 34 as of December 31, 2001 The City of Lafayette financial statements include prior years' infrastructure as of December 31, 2007 CITY OF LAFAYETTE, COLORADO NET ASSETS, LAST TEN YEARS SCHEDULE 1 For the Fiscal Year Ended December 31, 2010 119 ---PAGE BREAK--- 2006 2007 2008 2009 2010 Governmental activities Invested in capital assets, net of related debt 33,229,175 $ 94,030,382 $ 91,484,033 $ 107,348,070 $ 109,360,087 $ Restricted 8,449,975 9,669,215 14,609,426 8,202,961 7,218,855 Unrestricted 13,686,208 15,989,734 16,783,799 18,290,748 17,733,923 Total governmental activities net assets 55,365,358 119,689,331 122,877,258 133,841,779 134,312,865 Business-type activities Invested in capital assets, net of related debt 61,257,444 75,356,639 74,995,070 74,987,290 75,294,653 Restricted - - - - - Unrestricted 21,681,488 25,503,907 27,351,012 27,892,854 28,528,564 Total business-type activities net assets 82,938,932 100,860,546 102,346,082 102,880,144 103,823,217 Invested in capital assets, net of related debt 94,486,619 169,387,021 166,479,103 182,335,360 184,654,740 Restricted 8,449,975 9,669,215 14,609,426 8,202,961 7,218,855 Unrestricted 35,367,696 41,493,641 44,134,811 46,183,602 46,262,487 Total primary governmental net assets 138,304,290 $ 220,549,877 $ 225,223,340 $ 236,721,923 $ 238,136,082 $ 120 ---PAGE BREAK--- 2001 2002 2003 2004 2005 Expenses Governmental activities: General government 4,115,737 $ 3,551,255 $ 3,943,450 $ 4,090,732 $ 4,137,230 $ Judicial 338,231 351,190 298,156 279,656 299,968 Public safety 4,028,317 4,447,521 4,544,974 5,092,445 5,589,417 Public works 1,368,523 1,435,266 1,570,915 1,526,742 1,730,313 Culture and recreation 2,932,467 4,276,140 4,509,569 4,601,780 4,915,325 Interest on long-term debt 1,208,780 1,191,417 1,262,835 1,214,491 1,304,370 Total governmental activities expenses 13,992,055 15,252,789 16,129,899 16,805,846 17,976,623 Business-type activities: Water 2,862,587 3,475,347 4,108,398 4,512,239 4,509,549 Water reclamation 1,247,345 1,315,171 1,742,104 2,178,177 2,248,884 Golf course 1,732,443 1,721,011 1,782,439 1,523,687 1,644,464 Storm water - - - - - Total business-type activities expenses 5,842,375 6,511,529 7,632,941 8,214,103 8,402,897 Total primary governmental expenses 19,834,430 $ 21,764,318 $ 23,762,840 $ 25,019,949 $ 26,379,520 $ Program Revenues Governmental activities: Program revenues Charges for services General government 1,010,477 $ 1,822,817 $ 1,541,682 $ 1,051,805 $ 1,149,601 $ Judicial 160,335 248,467 388,147 438,660 447,101 Public safety 16,310 10,555 33,520 29,908 47,381 Public works 117,000 117,000 265,904 302,098 281,256 Culture and recreation 1,216,941 1,172,749 1,234,250 1,312,464 1,411,720 Total charges for services 2,521,063 3,371,588 3,463,503 3,134,935 3,337,059 Operating grants and contributions 922,497 949,277 1,158,588 984,653 913,437 Capital grants and contributions 1,453,120 2,015,516 2,456,336 4,784,311 2,253,872 Total governmental activities program revenues 4,896,680 6,336,381 7,078,427 8,903,899 6,504,368 Business-type activities: Program revenues Charges for services Water 3,823,050 2,779,487 3,755,408 3,793,791 4,923,757 Water reclamation 1,219,227 1,326,667 1,386,525 1,518,004 1,524,581 Storm water - - - - - Golf course 2,227,210 2,183,541 2,082,080 1,979,585 2,206,578 Total charges for services 7,269,487 6,289,695 7,224,013 7,291,380 8,654,916 Operating grants and contributions 12,150 - - - - Capital grants and contributions 6,091,211 2,328,562 2,272,411 6,636,596 5,048,166 Total business-type activities program revenues 13,372,848 8,618,257 9,496,424 13,927,976 13,703,082 Total primary government program revenues 18,269,528 $ 14,954,638 $ 16,574,851 $ 22,831,875 $ 20,207,450 $ CITY OF LAFAYETTE, COLORADO CHANGES IN NET ASSETS, LAST TEN YEARS SCHEDULE 2 For the Fiscal Year Ended December 31, 2010 121 ---PAGE BREAK--- 2006 2007 2008 2009 2010 Expenses Governmental activities: General government 4,502,008 $ 4,590,325 $ 5,440,531 $ 5,576,356 $ 6,911,396 $ Judicial 302,712 310,187 290,116 284,210 311,003 Public safety 5,985,716 6,913,573 7,382,185 7,215,606 7,587,907 Public works 2,035,038 3,633,406 4,916,059 4,607,496 5,466,171 Culture and recreation 4,895,446 5,295,757 5,698,114 5,872,607 5,920,901 Interest on long-term debt 1,530,509 1,492,229 1,514,513 1,261,069 1,124,734 Total governmental activities expenses 19,251,429 22,235,477 25,241,518 24,817,344 27,322,112 Business-type activities: Water 5,026,708 5,138,896 5,486,174 5,356,621 5,483,318 Water reclamation 2,470,857 2,611,185 2,889,586 2,709,406 2,769,695 Golf course 1,625,813 1,795,403 1,836,742 1,686,988 1,633,609 Storm water - 321 25,141 218,269 305,638 Total business-type activities expenses 9,123,378 9,545,805 10,237,643 9,971,284 10,192,260 Total primary governmental expenses 28,374,807 $ 31,781,282 $ 35,479,161 $ 34,788,628 $ 37,514,372 $ Program Revenues Governmental activities: Program revenues Charges for services General government 724,774 $ 962,093 $ 1,311,750 $ 148,017 $ 870,398 $ Judicial 717,508 851,855 915,158 1,034,448 973,241 Public safety 44,101 298,106 572,876 523,819 413,682 Public works 309,304 180,322 964,251 863,965 895,057 Culture and recreation 1,664,673 1,637,956 1,380,001 1,539,268 1,550,569 Total charges for services 3,460,360 3,930,332 5,144,036 4,109,517 4,702,947 Operating grants and contributions 965,959 1,209,991 1,208,330 1,311,088 1,356,870 Capital grants and contributions 3,147,419 6,869,830 3,289,125 11,422,080 3,270,777 Total governmental activities program revenues 7,573,738 12,010,153 9,641,491 16,842,685 9,330,594 Business-type activities: Program revenues Charges for services Water 5,943,428 5,485,274 5,574,085 4,828,996 4,934,602 Water reclamation 1,543,980 1,553,806 1,553,045 1,653,409 1,681,557 Storm water - 563,292 925,466 2,137,553 2,031,606 Golf course 2,337,037 2,432,189 2,424,316 665,258 643,913 Total charges for services 9,824,445 10,034,561 10,476,912 9,285,216 9,291,678 Operating grants and contributions - - - - - Capital grants and contributions 2,613,794 8,065,898 1,086,071 2,360,447 3,133,880 Total business-type activities program revenues 12,438,239 18,100,459 11,562,983 11,645,663 12,425,558 Total primary government program revenues 20,011,977 $ 30,110,612 $ 21,204,474 $ 28,488,348 $ 21,756,152 $ 122 ---PAGE BREAK--- 2001 2002 2003 2004 2005 Net (Expense)/Revenue Governmental activities (9,095,375) $ (8,916,408) $ (9,051,472) $ (7,901,947) $ (11,472,255) $ Business-type activities 7,530,473 2,106,728 1,863,483 5,713,873 5,300,185 Total primary government net expenses (1,564,902) (6,809,680) (7,187,989) (2,188,074) (6,172,070) General Revenues and Changes in Net Assets Governmental activities: Taxes Property taxes 2,431,160 3,034,093 3,466,370 3,637,650 3,734,122 Sales and use taxes 7,728,825 7,813,578 7,892,329 8,304,870 8,578,845 Other taxes - - 32,319 40,760 33,322 Unrestricted grants and contributions - - - - - Interest 1,247,609 696,317 295,299 255,735 563,709 Franchise taxes 560,884 559,043 630,347 708,253 813,636 Other general revenues 33,501 35,375 - Gain (loss) on sale of capital assets - - 498,819 7,245 15,480 Transfers 1,921,849 1,204,194 2,608,402 1,239,670 1,436,116 Special items Adjustment of asset held for resale - - 72,182 268,032 - Gain on fire conversion - - - - - Adjustment of note receivable - - - - - Total governmental activities 13,923,828 13,342,600 15,496,067 14,462,215 15,175,230 Business-type activities: Interest 1,243,534 735,817 378,439 366,292 728,013 Gain (loss) on sale of capital assets - - - 8,440 - Transfers (1,921,849) (1,204,194) (2,608,402) (1,239,670) (1,436,116) Other general revenues 49,470 - - - - Special item - return water rights to developer - - - - - Total business-type activities (628,845) (468,377) (2,229,963) (864,938) (708,103) Total primary government 13,294,983 12,874,223 13,266,104 13,597,277 14,467,127 Changes in Net Assets Governmental activities 4,828,453 4,426,192 6,444,595 6,560,268 3,702,975 Business-type activities 6,901,628 1,638,351 (366,480) 4,848,935 4,592,082 Total primary government net assets 11,730,081 $ 6,064,543 $ 6,078,115 $ 11,409,203 $ 8,295,057 $ Notes: The City of Lafayette implemented GASB 34 as of December 31, 2001 The City of Lafayette financial statements include prior years' infrastructure as of December 31, 2007 CITY OF LAFAYETTE, COLORADO CHANGES IN NET ASSETS, LAST TEN YEARS SCHEDULE 2 (CONTINUED) For the Fiscal Year Ended December 31, 2010 123 ---PAGE BREAK--- 2006 2007 2008 2009 2010 Net (Expense)/Revenue Governmental activities (11,677,691) $ (10,225,324) $ (15,600,027) $ (7,974,659) $ (17,991,518) $ Business-type activities 3,314,861 8,554,654 1,325,340 1,674,379 2,233,298 Total primary government net expenses (8,362,830) (1,670,670) (14,274,687) (6,300,280) (15,758,220) General Revenues and Changes in Net Assets Governmental activities: Taxes Property taxes 4,636,466 4,517,103 4,475,327 6,367,167 6,479,248 Sales and use taxes 9,411,455 10,080,824 10,291,910 10,250,821 10,180,788 Other taxes 40,940 34,806 - - - Unrestricted grants and contributions - - - 30,926 34,688 Interest 1,043,848 1,299,871 1,455,686 354,536 301,530 Franchise taxes 863,349 868,106 1,000,028 913,075 981,752 Other general revenues - - 31,075 644 - Gain (loss) on sale of capital assets 47,733 7,180 7,946 42,831 Transfers 1,465,438 1,415,425 1,415,946 1,548,521 1,616,767 Special items Adjustment of asset held for resale - - - (631,968) - Gain on fire conversion - 199,677 110,036 105,458 - Adjustment of note receivable - - - - (1,175,000) Total governmental activities 17,509,229 18,422,992 18,787,954 18,939,180 18,462,604 Business-type activities: Interest 1,417,902 2,070,994 2,045,405 408,204 326,542 Gain (loss) on sale of capital assets - - - - - Transfers (1,465,438) (1,415,425) (1,415,946) (1,548,521) (1,616,767) Other general revenues - - - - - Special item - return water rights to developer - - (469,263) Total business-type activities (47,536) 655,569 160,196 (1,140,317) (1,290,225) Total primary government 17,461,693 19,078,561 18,948,150 17,798,863 17,172,379 Changes in Net Assets Governmental activities 5,831,538 8,197,668 3,187,927 10,964,521 471,086 Business-type activities 3,267,325 9,210,223 1,485,536 534,062 943,073 Total primary government net assets 9,098,863 $ 17,407,891 $ 4,673,463 $ 11,498,583 $ 1,414,159 $ 124 ---PAGE BREAK--- 2001 2002 2003 2004 2005 General fund Reserved 12,048 $ 966,172 $ 2,306,175 $ 3,698,609 $ 3,676,917 $ Resources not in spendable form - - - - - Restricted - - - - - Committed - - - - - Assigned - - - - - Unreserved 11,192,912 9,747,503 9,138,312 4,966,419 4,320,066 Unassigned - - - - - Total general fund 11,204,960 $ 10,713,675 $ 11,444,487 $ 8,665,028 $ 7,996,983 $ All other governmental funds Reserved 11,335,232 $ 20,264,238 $ 5,124,545 $ 4,209,126 $ 8,160,580 $ Resources not in spendable form - - - - - Restricted - - - - - Committed - - - - - Assigned - - - - - Unreserved, reported in: Special revenue funds 102,490 192,888 277,783 601,577 748,504 Capital project funds - 4,859,425 6,466,668 6,817,919 3,689,182 Debt service fund - - - - 3,751 Total other governmental funds 11,437,722 $ 25,316,551 $ 11,868,996 $ 11,628,622 $ 12,602,017 $ Notes: The City of Lafayette implemented GASB 34 as of December 31, 2001 The City of Lafayette financial statements include prior years' infrastructure as of December 31, 2007 The City of Lafayette implemented classification changes per GASB 54 as of December 31, 2010 CITY OF LAFAYETTE, COLORADO FUND BALANCES, GOVERNMENTAL FUNDS, LAST TEN YEARS SCHEDULE 3 For the Fiscal Year Ended December 31, 2010 125 ---PAGE BREAK--- 2006 2007 2008 2009 2010 General fund Reserved 3,861,134 $ 4,903,315 $ 4,895,129 $ 4,700,316 $ - $ Resources not in spendable form - - - - 1,066,817 Restricted - - - - 1,077,404 Committed - - - - 1,217,379 Assigned - - - - 5,027,742 Unreserved 4,956,337 6,418,992 7,450,132 9,103,776 - Unassigned - - - - 4,995,187 Total general fund 8,817,471 $ 11,322,307 $ 12,345,261 $ 13,804,092 $ 13,384,529 $ All other governmental funds Reserved 5,416,688 $ 3,749,378 $ 12,878,005 $ 9,357,019 $ - $ Resources not in spendable form - - - - 46,398 Restricted - - - - 5,914,284 Committed - - - - 228,516 Assigned - - - - 2,340,184 Unreserved, reported in: Special revenue funds 943,701 982,056 936,855 1,435,036 - Capital project funds 4,619,021 3,836,539 - - - Debt service fund 38,342 355,034 187,261 80,309 - Total other governmental funds 11,017,752 $ 8,923,007 $ 14,002,121 $ 10,872,364 $ 8,529,382 $ 126 ---PAGE BREAK--- 2001 2002 2003 2004 2005 Revenues Taxes 10,159,985 $ 10,847,671 $ 11,358,699 $ 11,947,820 $ 12,318,267 $ Licenses and permits 786,006 1,031,737 911,379 913,460 780,630 Intergovernmental 1,167,262 1,190,177 1,326,863 1,600,202 1,096,289 Urban drainage district - - 200,809 - - Fines and forfeitures 160,335 283,692 420,456 465,286 478,208 Franchise taxes 560,884 559,043 630,347 708,253 813,636 Interest 1,206,695 634,104 320,793 246,267 517,356 Sidewalk maintenance/repair - 80,424 95,597 82,259 84,496 Contributions 1,000,100 65,779 74,842 69,660 153,190 Charges for services 1,478,627 1,956,809 1,759,327 1,539,653 1,645,548 Special assessments principal 74,303 81,717 488,453 239,353 8,735 Special assessments interest - 70,163 1,363,755 1,004,650 62,273 Administrative fees - - 22,615 88,374 95,969 Miscellaneous 263,548 99,350 593,552 172,101 105,821 Total revenues 16,857,745 16,900,666 19,567,487 19,077,338 18,160,418 Expenditures General government 3,717,684 3,425,548 3,706,811 6,191,131 3,797,408 Judicial 338,231 351,441 297,246 279,630 299,383 Public safety 3,711,685 4,015,889 4,142,895 4,637,191 5,215,916 Public works 1,224,329 1,223,634 1,380,334 1,241,332 1,318,180 Culture and recreation 2,484,745 3,688,467 3,923,821 4,056,279 4,282,927 Capital outlay 7,601,060 4,795,190 6,579,285 4,391,912 7,096,025 Debt service Capital lease payments - 255,400 254,506 256,721 244,445 Principal 906,931 963,287 19,294,637 1,215,978 1,765,000 Interest and fiscal charges 1,162,547 998,916 1,465,817 1,095,552 1,173,982 Bond issuance costs 198,802 244,544 183,488 - 108,799 Total expenditures 21,346,014 19,962,316 41,228,840 23,365,726 25,302,065 Excess of revenues over (under) expenditures (4,488,269) (3,061,650) (21,661,353) (4,288,388) (7,141,647) CITY OF LAFAYETTE, COLORADO CHANGES IN FUND BALANCES, GOVERNMENTAL FUNDS, LAST TEN YEARS SCHEDULE 4 For the Fiscal Year Ended December 31, 2010 127 ---PAGE BREAK--- 2006 2007 2008 2009 2010 Revenues Taxes 14,053,221 $ 14,603,227 $ 14,771,535 $ 16,623,287 $ 16,665,336 $ Licenses and permits 1,015,589 421,730 253,390 299,752 377,013 Intergovernmental 1,275,115 1,547,140 1,510,385 1,648,211 1,738,107 Urban drainage district - - - - Fines and forfeitures 752,055 851,855 915,158 1,034,448 973,241 Franchise taxes 863,349 868,106 1,000,028 913,075 981,752 Interest 971,545 1,143,086 1,392,581 316,379 266,346 Sidewalk maintenance/repair 86,799 58,681 88,598 92,980 89,439 Contributions 40,318 1,884,478 223,094 165,183 119,227 Charges for services 1,716,339 2,255,825 3,256,023 3,973,302 3,504,277 Special assessments principal 635,569 736,983 1,165,209 6,902,495 48,499 Special assessments interest 827,804 548,322 597,149 (18,341) 499,614 Administrative fees 62,683 62,683 57,627 89,859 31,499 Miscellaneous 292,658 82,034 99,185 55,649 249,341 Total revenues 22,593,044 25,064,150 25,329,962 32,096,279 25,543,691 Expenditures General government 4,201,131 4,415,363 5,237,978 5,419,112 6,710,378 Judicial 301,862 310,518 290,028 284,250 310,795 Public safety 5,587,442 6,332,944 6,707,011 6,570,321 6,953,898 Public works 1,437,309 1,755,484 2,643,677 2,091,803 2,821,786 Culture and recreation 4,197,522 4,367,085 4,725,802 4,849,524 4,886,184 Capital outlay 5,596,574 6,542,656 5,651,205 5,886,575 5,267,146 Debt service Capital lease payments 94,914 172,735 243,990 461,826 539,659 Principal 1,955,000 2,025,000 2,100,000 8,125,000 1,445,000 Interest and fiscal charges 1,429,713 1,390,828 1,428,637 1,100,805 988,157 Bond issuance costs 20,792 - 49,500 - - Total expenditures 24,822,259 27,312,613 29,077,828 34,789,216 29,923,003 Excess of revenues over (under) expenditures (2,229,215) (2,248,463) (3,747,866) (2,692,937) (4,379,312) 128 ---PAGE BREAK--- 2001 2002 2003 2004 2005 Other financing sources (uses) Proceeds from debt 5,950,000 $ 15,245,000 $ 6,408,390 $ - $ 6,010,881 $ Retirement of bonds refunded - - - - - Lease issuance 357,208 - - 56,622 - Transfers in 2,016,302 3,886,251 15,657,178 4,918,211 1,891,595 Transfers out (94,453) (2,682,057) (13,048,776) (3,438,246) (455,479) Total other financing sources (uses) 8,229,057 16,449,194 9,016,792 1,536,587 7,446,997 Special Item Adjustment of asset held for resale - - (72,182) (268,032) - Gain on fire conversion - - - - - Total special items - - (72,182) (268,032) - Net change in fund balances 3,740,788 $ 13,387,544 $ (12,716,743) $ (3,019,833) $ 305,350 $ Debt service as a percentage of noncapital expenditures 15.1% 14.6% 60.7% 13.5% 17.5% Notes: The City of Lafayette implemented GASB 34 as of December 31, 2001 The City of Lafayette financial statements include prior years' infrastructure as of December 31, 2007 CITY OF LAFAYETTE, COLORADO CHANGES IN FUND BALANCES, GOVERNMENTAL FUNDS, LAST TEN YEARS SCHEDULE 4 (CONTINUED) For the Fiscal Year Ended December 31, 2010 129 ---PAGE BREAK--- 2006 2007 2008 2009 2010 Other financing sources (uses) Proceeds from debt 2,070,000 $ 1,243,179 $ 8,023,279 $ - $ - $ Retirement of bonds refunded (2,040,000) - - - - Lease issuance - - - - - Transfers in 1,996,337 4,437,885 2,426,106 3,090,256 3,351,769 Transfers out (530,899) (3,022,460) (1,010,160) (1,541,735) (1,735,002) Total other financing sources (uses) 1,495,438 2,658,604 9,439,225 1,548,521 1,616,767 Special Item Adjustment of asset held for resale - - - (631,968) - Gain on fire conversion - - 410,709 105,458 - Total special items - - 410,709 (526,510) - Net change in fund balances (733,777) $ 410,141 $ 6,102,068 $ (1,670,926) $ (2,762,545) $ Debt service as a percentage of noncapital expenditures 18.1% 17.3% 16.1% 33.5% 12.1% 130 ---PAGE BREAK--- General Fire Specific Total Fiscal Property District Ownership Cigarette Sales Franchise Use General Tax Year Tax 1, 4 Tax Tax Tax3 Tax Tax Tax 2 Revenues 2001 2,227,393 5,300 202,634 33,501 4,882,252 560,884 2,846,573 10,758,537 2002 2,780,105 5,300 248,688 33,343 4,965,407 559,043 2,848,171 11,440,057 2003 3,206,560 5,300 254,510 32,319 5,194,537 630,347 2,697,792 12,021,365 2004 3,380,859 5,300 256,791 35,560 5,631,759 708,253 2,673,111 12,691,633 2005 3,475,379 5,300 258,745 28,022 6,196,060 813,636 2,382,786 13,159,928 2006 4,339,992 5,300 296,474 35,640 7,037,401 863,349 2,374,054 14,952,210 2007 4,231,390 5,300 285,712 29,506 7,813,683 868,106 2,493,030 15,726,727 2008 4,202,863 5,300 272,464 31,075 8,471,790 1,000,028 1,820,120 15,803,640 2009 6,053,858 5,300 313,309 30,927 8,300,753 913,075 1,950,068 17,567,289 2010 6,168,827 5,300 310,421 34,688 8,273,535 981,752 1,907,253 17,681,776 1 Includes property taxes from general improvement districts 2 Includes taxes on building materials and motor vehicles. 3 Beginning in 2002, amount is included in intergovernmental revenue on the Statement of Revenues, Expenditures and Changes in Fund Balances - Governmental Funds 4 Beginning in 2009, amount includes property taxes from Ambulance and Fire Fund. SCHEDULE 5 For the Fiscal Year Ended December 31, 2010 CITY OF LAFAYETTE, COLORADO GENERAL GOVERNMENTAL TAX REVENUES BY SOURCE 131 ---PAGE BREAK--- Total Regional Cultural Football Overlapping Fiscal City of State of Boulder Transportation Facilities Stadium Sales Tax Year Lafayette Colorado County District District District Rate 2001 3.50% 2.90% 0.55% 0.60% 0.10% 0.10% 7.75% 2002 3.50% 2.90% 0.55% 0.60% 0.10% 0.10% 7.75% 2003 3.50% 2.90% 0.55% 0.60% 0.10% 0.10% 7.75% 2004 3.50% 2.90% 0.65% 1.00% 0.10% 0.10% 8.25% 2005 3.50% 2.90% 0.65% 1.00% 0.10% 0.10% 8.25% 2006 3.50% 2.90% 0.65% 1.00% 0.10% 0.10% 8.25% 2007 3.50% 2.90% 0.65% 1.00% 0.10% 0.10% 8.25% 2008 3.50% 2.90% 0.65% 1.00% 0.10% 0.10% 8.25% 2009 3.50% 2.90% 0.65% 1.00% 0.10% 0.10% 8.25% 2010 3.50% 2.90% 0.65% 1.00% 0.10% 0.10% 8.25% Note: The City of Lafayette implemented GASB 34 as of December 31, 2001 Overlapping Rates CITY OF LAFAYETTE, COLORADO DIRECT AND OVERLAPPING SALES TAX RATES SCHEDULE 6 Last Ten Fiscal Years 132 ---PAGE BREAK--- 2002 1 2003 2004 2005 2006 Aggregate top ten filers 2 2,642,451 $ 2,780,563 $ 3,144,410 $ 3,446,035 $ 3,713,861 $ Aggregate all other filers 2,587,960 2,636,528 2,791,949 2,994,130 3,642,042 Total sales and use tax 5,230,411 $ 5,417,091 $ 5,936,359 $ 6,440,165 $ 7,355,903 $ Top ten filers as a percentage of total sales tax 50.52% 51.33% 52.97% 53.51% 50.49% 1 Data for 2001 unavailable. 2 Colorado State Statutes and City of Lafayette Ordinances prohibit disclosure of individual sales tax information. Therefore, the current year top ten filers are not individually listed. Notes: Excludes building use tax and motor vehicle use tax and audit revenue. The City of Lafayette implemented GASB 34 as of December 31, 2001 CITY OF LAFAYETTE, COLORADO PRINCIPAL SALES AND USE TAX PAYERS SCHEDULE 7 Last Nine Fiscal Years 133 ---PAGE BREAK--- 2007 2008 2009 2010 Aggregate top ten filers 5,047,321 $ 4,842,212 $ 4,689,937 $ 4,604,871 $ Aggregate all other filers 3,221,810 3,815,397 3,908,266 3,979,437 Total sales and use tax 8,015,494 $ 8,657,609 $ 8,598,203 $ 8,584,308 $ Top ten filers as a percentage of total sales tax 62.97% 55.93% 54.55% 53.64% 134 ---PAGE BREAK--- Sales Tax Limited Tax General Fiscal Revenue Revenue Obligation Demand Capital Term Loan Year Bonds 1 Bonds Bonds Bonds Leases Payable 2001 6,635,000 $ 2,950,000 $ 5,208,903 $ 12,000,000 $ 584,962 $ 950,000 $ 2002 6,100,000 2,940,000 7,535,616 24,500,000 442,107 923,416 2003 5,670,000 5,625,000 4,345,979 12,500,000 294,623 895,306 2004 5,010,000 5,530,000 3,885,000 12,500,000 184,916 865,702 2005 4,340,000 5,400,000 9,395,000 12,025,000 28,288 834,287 2006 3,660,000 5,340,000 8,680,000 11,525,000 14,308 801,067 2007 2,965,000 5,275,000 7,935,000 11,005,000 1,200,118 765,942 2008 9,165,000 5,200,000 7,160,000 10,465,000 2,079,051 728,805 2009 8,435,000 5,120,000 6,355,000 3,955,000 1,774,386 689,008 2010 7,685,000 5,000,000 5,780,000 3,955,000 1,380,486 647,492 1 Total sales tax is 3.50%. After 0.50% is set aside for open space, sales tax revenue bonds are paid out of the 3.00% remaining. 2 General obligation bonds have been issued for business-type activities. While general obligation water bonds are direct obligations and pledge the full faith and credit of the City, the City is bound by bond covenant to establish water rates which will provide for operations and debt service. 3 See Schedule 12 for Population and Personal Income figures. Governmental Activities CITY OF LAFAYETTE, COLORADO SCHEDULE 8 Last Ten Fiscal Years RATIO OF OUTSTANDING DEBT, BY TYPE 135 ---PAGE BREAK--- General Water Sewer Golf Total Percent Oblig. Water Revenue Refunding Revenue Capital Term Loan Primary Debt Per Personal Bonds 2 Bonds Bonds Bonds Leases Payable Government Capita 3 Income 3 6,485,000 $ - $ 900,000 $ 900,000 $ 85,132 $ 7,861,139 $ 44,560,136 $ 1,762 $ 6.71% 6,025,000 - 690,000 500,000 - 7,861,139 57,517,278 2,202 8.45% 5,645,000 15,645,000 470,000 500,000 - 7,838,505 59,429,413 2,342 8.51% 5,095,000 15,645,000 240,000 500,000 - 7,754,980 57,210,598 2,284 8.00% 4,535,000 15,645,000 - 461,200 - 7,663,956 60,327,731 2,338 8.24% 3,955,000 15,809,458 - 420,200 165,073 7,303,810 57,673,916 2,230 7.70% 3,350,000 15,645,000 - 377,000 120,609 7,083,555 55,722,224 2,106 7.79% 2,735,000 15,645,000 - 331,400 74,036 6,688,501 60,271,793 2,323 8.64% 2,090,000 15,645,000 - 283,300 25,251 6,272,317 50,644,262 1,915 7.27% 635,000 15,645,000 - 232,500 - 5,842,506 46,802,984 1,914 5.89% Business-Type Activities 136 ---PAGE BREAK--- 2001 2002 2003 2004 2005 General bonded debt outstanding 35,078,903 $ 48,290,616 $ 50,400,979 $ 48,405,000 $ 51,801,200 $ Less: General obligation water bonds 6,485,000 6,025,000 5,645,000 5,095,000 4,535,000 Water revenue bonds - - 15,645,000 15,645,000 15,645,000 Sewer revenue bonds 900,000 690,000 470,000 240,000 - Tech center GID revenue bonds - - - - - Limited tax obligation bonds 2,950,000 5,685,000 5,625,000 5,530,000 5,400,000 Sales tax revenue bonds 6,635,000 6,100,000 5,670,000 5,010,000 4,340,000 Demand bonds 12,000,000 24,500,000 12,500,000 12,500,000 12,025,000 Golf course revenue bonds 900,000 500,000 500,000 500,000 461,200 Total net debt applicable to debt limit 5,208,903 4,790,616 4,345,979 3,885,000 9,395,000 Estimated actual property values 1 1,518,282,500 1,955,990,500 2,025,956,955 2,494,049,689 2,589,204,957 Legal debt limit 2 45,548,475 58,679,715 60,778,709 74,821,491 77,676,149 Legal debt margin 3 40,339,572 $ 53,889,099 $ 56,432,730 $ 70,936,491 $ 68,281,149 $ Outstanding debt as a percentage of debt limit 11% 8% 7% 5% 12% Population 25,283 26,121 25,373 25,051 25,798 Net general bonded debt per capita 206 $ 183 $ 171 $ 155 $ 364 $ 1 Source: Boulder County Assessor's Office. The Estimated Actual Property Values are from the previous year, but are used to calculate current year tax revenues and debt limits. 2 Debt limit is 3% of Estimated Actual Real Estate Value 3 The legal debt margin is the city's available borrowing authority Note: The City of Lafayette implemented GASB 34 as of December 31, 2001 CITY OF LAFAYETTE, COLORADO RATIO OF GENERAL BONDED DEBT OUTSTANDING AND LEGAL DEBT LIMIT SCHEDULE 9 Last Ten Fiscal Years Fiscal Year 137 ---PAGE BREAK--- 2006 2007 2008 2009 2010 General bonded debt outstanding 49,225,200 $ 46,552,000 $ 50,701,400 $ 41,883,300 $ 38,297,500 $ Less: General obligation water bonds 3,955,000 3,350,000 2,735,000 2,090,000 - Water revenue bonds 15,645,000 15,645,000 15,645,000 15,645,000 15,645,000 Sewer revenue bonds - - - Tech center GID revenue bonds 2,040,000 2,040,000 2,040,000 2,040,000 2,010,000 Limited tax obligation bonds 3,300,000 3,235,000 3,160,000 3,080,000 2,990,000 Sales tax revenue bonds 3,660,000 2,965,000 9,165,000 8,435,000 7,685,000 Demand bonds 11,525,000 11,005,000 10,465,000 3,955,000 3,955,000 Golf course revenue bonds 420,200 377,000 331,400 283,300 232,500 Total net debt applicable to debt limit 8,680,000 7,935,000 7,160,000 6,355,000 5,780,000 Estimated actual property values 1 2,829,493,700 2,903,216,100 2,992,447,300 3,042,980,900 3,081,645,100 Legal debt limit 2 84,884,811 87,096,483 89,773,419 91,289,427 92,449,353 Legal debt margin 3 76,204,811 $ 79,161,483 $ 82,613,419 $ 84,934,427 $ 86,669,353 $ Outstanding debt as a percentage of debt limit 10% 9% 8% 7% 6% Population 25,864 26,453 25,945 26,448 24,453 Net general bonded debt per capita 336 $ 300 $ 276 $ 240 $ 236 $ Fiscal Year 138 ---PAGE BREAK--- General Percentage Estimated Obligation Applicable Share of Bonded Debt To Overlapping Jurisdiction Outstanding Government Debt Direct: City of Lafayette 5,780,000 $ 100.00% 5,780,000 $ Overlapping: Boulder Valley School District RE-2 1 374,280,000 5.66% 21,184,248 Total 380,060,000 $ 26,964,248 $ Overlapping governments are those that coincide, at least in part, with the geographic boundaries of the City. Flood Control District and the Regional Transportation District. CITY OF LAFAYETTE, COLORADO DIRECT AND OVERLAPPING GOVERNMENTAL ACTIVITIES DEBT For the Fiscal Year Ended December 31, 2010 SCHEDULE 10 1 The following entities overlap the City, but have no general obligation debt outstanding: Boulder County, Lafayette Rural Fire Protection District, Lefthand Water District, Louisville Fire Protection District, Urban Drainage and 139 ---PAGE BREAK--- Net Fiscal Gross Available Year Resources 1 Expenses 2 Revenue Principal Interest Coverage 3 2001 9,865,133 $ 2,369,461 $ 7,495,672 $ - $ - $ N/A 2002 4,966,753 2,642,397 2,324,356 - - N/A 2003 5,832,700 4,074,441 1,758,259 - 494,189 3.56 2004 6,603,085 3,052,834 3,550,251 - 757,056 4.69 2005 8,103,805 3,174,499 4,929,306 - 757,056 6.51 2006 8,475,028 3,370,235 5,104,793 - 757,056 6.74 2007 8,743,832 3,262,208 5,481,624 - 757,056 7.24 2008 7,795,860 3,509,937 4,285,923 - 757,056 5.66 2009 5,837,267 3,488,140 2,349,127 - 757,056 3.10 2010 7,267,461 3,725,343 3,542,118 - 757,056 4.68 Sales & Use Debt Service Tax Increment Principal Interest Coverage 4 2001 6,634,402 $ 510,000 $ 344,505 $ 7.76 2002 6,713,205 535,000 322,320 7.83 2003 6,774,074 5 690,000 314,520 6.74 2004 7,090,526 660,000 146,277 8.79 2005 7,326,359 670,000 133,077 9.12 2006 8,054,767 680,000 119,677 10.07 2007 8,619,750 695,000 106,078 10.76 2008 8,317,710 6 710,000 222,590 8.92 2009 8,257,862 730,000 302,121 8.00 2010 8,310,576 750,000 280,221 8.07 1 Gross resources include all operating revenues plus interest and other non-operating revenues. Included are tap fees and cash received in lieu of water rights, both of which are classified as capital contributions. 2 Includes all operating expenses less depreciation and amortization, plus transfers out. 3 Net available revenue divided by total bond principle and interest. 4 Sales & Use Tax Increment divided by total bond principle and interest. 5 Refunded 1993 Sales & Use Tax bonds with 2003C Sales & Use Tax bonds in the amount of $6,360,000. 6 Issued 2008 Series Sales & Use Tax Revenue Bonds in the amount of $6,910,000. 7 Adverse business conditions caused an extension of the final maturity date of these bonds. 8 Expenses included an escrow payment of $745,760 accumulated from a prior year as partial payment on the redemption of the bonds. The amount was removed for this calculation. Sales Tax Revenue Bonds Debt Service Water Revenue Bonds CITY OF LAFAYETTE, COLORADO PLEDGED REVENUE COVERAGE SCHEDULE 11 Last Ten Fiscal Years 140 ---PAGE BREAK--- Net Fiscal Gross Available Year Resources 1 Expenses 2 Revenue Principal Interest Coverage 3 2001 2,430,487 $ 1,445,719 $ 984,768 $ - $ 21,809 $ 45.15 2002 2,178,818 994,957 1,183,861 102,093 233,159 3.53 2003 1,927,172 1,162,668 764,504 102,093 308,272 1.86 2004 2,542,329 1,357,551 1,184,778 107,466 306,185 2.86 2005 2,729,239 1,393,503 1,335,736 107,466 296,142 3.31 2006 2,471,143 1,630,342 840,801 365,384 288,260 1.29 2007 2,627,771 1,661,653 966,118 376,131 277,390 1.48 2008 2,374,918 1,918,606 456,312 381,504 166,295 0.83 2009 1,816,331 1,819,954 (3,623) 392,250 62,890 -0.01 2010 2,593,645 1,960,953 632,692 416,582 233,935 0.97 Net Fiscal Gross Available Year Resources 1 Expenses 2 Revenue Principal Interest Coverage 3 2001 2,288,650 $ 2,114,467 $ 174,183 $ - $ 49,500 $ 3.52 2002 2,208,503 2,120,590 87,913 900,000 49,500 0.09 2003 2,082,080 2,180,448 (98,368) 200,000 11,000 -0.47 2004 1,982,242 1,907,957 74,285 200,000 22,000 0.33 2005 2,215,416 2,073,351 142,065 7 38,800 27,500 2.14 2006 2,357,877 2,077,498 280,379 41,000 25,364 4.22 2007 2,470,853 2,211,448 259,405 43,200 23,111 3.91 2008 2,448,149 2,209,636 238,513 45,600 20,734 3.60 2009 2,140,067 2,063,656 76,411 48,100 18,226 1.15 2010 2,033,348 2,004,342 29,006 50,800 15,580 0.44 Golf Course Revenue Bonds Debt Service CITY OF LAFAYETTE, COLORADO PLEDGED REVENUE COVERAGE SCHEDULE 11 (CONTINUED) Last Ten Fiscal Years Loan Debt Service 141 ---PAGE BREAK--- Net Fiscal Gross Available Year Resources 1 Expenses 2 Revenue Principal Interest Coverage 3 2001 40,088 $ - $ 40,088 $ - $ 43,125 $ 0.93 2002 74,020 5,458 68,562 5,000 43,125 1.42 2003 72,973 26,678 46,295 10,000 43,638 0.86 2004 78,114 18,644 59,470 15,000 42,243 1.04 2005 75,214 10,600 64,614 20,000 41,400 1.05 2006 80,831 10,712 70,119 25,000 40,250 1.07 2007 84,573 9,486 75,087 30,000 38,813 1.09 2008 82,139 9,475 72,664 35,000 37,088 1.01 2009 80,512 9,523 70,989 40,000 35,075 0.95 2010 86,275 9,215 77,060 45,000 32,775 0.99 Net Fiscal Gross Available Year Resources 1 Expenses 2 Revenue Principal Interest Coverage 3 2001 - $ - $ - $ - $ - $ N/A 2002 - - - - - N/A 2003 1,502,465 9,043,435 (7,540,970) - 325,998 -23.13 2004 1,309,597 28,212 1,281,385 - 321,809 3.98 2005 211,335 25,181 186,154 475,000 301,912 0.24 2006 1,544,227 33,201 1,511,026 500,000 522,100 1.48 2007 1,322,582 25,729 1,296,853 520,000 541,898 1.22 2008 1,829,055 23,355 1,805,700 540,000 385,205 1.95 2009 6,928,099 49,984 8 6,878,115 6,510,000 137,579 1.03 2010 611,942 726,393 (114,451) - 86,400 -1.32 Exempla GID Debt Service CITY OF LAFAYETTE, COLORADO PLEDGED REVENUE COVERAGE SCHEDULE 11 (CONTINUED) Last Ten Fiscal Years Lafayette City Center GID Revenue Bonds Debt Service 142 ---PAGE BREAK--- Net Fiscal Gross Available Year Resources 1 Expenses 2 Revenue Principal Interest Coverage 3 2001 - $ - $ - $ - $ - $ N/A 2002 - - - - - N/A 2003 288,198 7,022 281,176 25,000 214,053 1.18 2004 291,530 20,505 271,025 30,000 217,600 1.09 2005 277,061 34,520 242,541 30,000 215,200 0.99 2006 281,609 16,086 265,523 35,000 212,800 1.07 2007 282,353 14,065 268,288 35,000 210,000 1.10 2008 428,238 13,675 414,563 40,000 207,200 1.68 2009 262,680 13,944 248,736 40,000 204,000 1.02 2010 262,753 13,993 248,760 45,000 200,800 1.01 Net Fiscal Gross Available Year Resources 1 Expenses 2 Revenue Principal Interest Coverage 3 2001 - $ - $ - $ - $ - $ N/A 2002 - - - - - N/A 2003 - - - - - N/A 2004 - - - - - N/A 2005 - - - - - N/A 2006 236,777 22,097 214,680 - 144,925 1.48 2007 78,887 16,004 62,883 - 132,600 0.47 2008 82,142 7,372 74,770 - 122,400 0.61 2009 135,822 9,937 125,885 - 122,400 1.03 2010 169,781 10,926 158,855 30,000 122,400 1.04 Lafayette Corp Campus GID Debt Service Lafayette Tech Center GID Debt Service CITY OF LAFAYETTE, COLORADO PLEDGED REVENUE COVERAGE SCHEDULE 11 (CONTINUED) Last Ten Fiscal Years 143 ---PAGE BREAK--- Personal Income Per Median Fiscal Estimated (thousands Capita Median Education School Unemp. Year Population of dollars) Income Age Level Enrollment Rate 2001 25,283 663,970 $ 27,780 $ 35.3 13 3,877 3.8% 2002 26,121 681,032 26,072 33.8 13 3,712 5.7% 2003 25,373 698,094 27,510 33.8 13 3,712 5.7% 2004 25,051 715,156 28,548 33.8 14 3,994 5.0% 2005 25,798 732,218 28,383 33.8 14 4,086 4.5% 2006 25,864 749,280 28,970 34.4 14 4,159 3.7% 2007 26,453 714,919 27,026 33.8 14 4,840 2.8% 2008 25,945 688,866 26,551 36.0 14 3,323 5.8% 2009 26,448 696,482 26,334 36.3 14 3,946 5.2% 2010 24,453 794,062 32,473 36.3 14 4,790 5.3% Estimated Estimated % Number Number Total Firm Employees Firm Employees Employees City of Lafayette 330 Exempla Good Samaritan 1500 14.1% Design Fabricators 290 Abacus 370 3.5% Advanced Component Systems 250 City of Lafayette 330 3.1% Development Disabilities Center 250 Universal Forest Products 285 2.7% Dynamic Materials 159 Imagine! 250 2.4% Wal-Mart 189 Wal-Mart 189 1.8% Rocky Mountain Instruments 150 Rocky Mountain Instruments 150 1.4% Albertsons 112 Dharmacon 130 1.2% Coherent Technologies 100 King Soopers 120 1.1% Electric 60 Northrup Grumman 110 1.0% 1 Information on total employees in 2001 was not available. Sources: Bureau of Labor Statistics Boulder County School District R-1 Lafayette Chamber of Commerce Lafayette Community Development Department Metro Denver GIS CITY OF LAFAYETTE, COLORADO DEMOGRAPHIC AND ECONOMIC STATISTICS SCHEDULE 12 Last Ten Fiscal Years 2001 1 2010 AND TOP TEN EMPLOYERS FOR 2001 AND 2010 144 ---PAGE BREAK--- 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 Function/Program Executive and administration City council 0.70 0.70 0.70 0.70 0.70 0.70 0.70 0.70 0.70 0.70 City administrator City administration 3.05 3.05 3.05 3.05 3.05 1.05 1.05 1.00 1.00 1.00 Community development - - - - 2.00 2.00 2.00 2.05 2.05 - City clerk 1.00 1.50 1.50 1.00 1.00 2.00 2.00 2.00 2.00 2.20 Municipal court 2.00 2.50 2.50 2.50 2.50 2.50 2.75 2.75 2.75 2.75 Finance Administrative services 1.33 1.33 1.33 1.33 1.33 1.33 1.33 1.00 1.00 1.00 Human resources 3.00 3.00 3.00 3.00 3.00 3.00 3.00 3.00 3.00 3.00 Financial services (accounting) 7.00 6.00 6.00 6.00 6.00 6.00 7.00 7.33 7.33 5.50 Information technologies 2.00 2.00 3.00 3.00 3.00 3.00 3.00 3.00 3.00 3.00 Community Development Community development 7.00 7.00 7.00 7.00 7.00 7.00 7.00 7.00 7.00 8.00 Public safety Police department 46.00 46.00 48.00 48.00 50.00 50.00 50.00 52.00 52.00 48.50 Fire department 2.63 2.50 2.50 2.50 5.50 5.50 5.50 5.50 5.50 4.50 Ambulance - - - - - - 10.89 11.22 11.22 14.00 Public works & utilities Public works administration 14.20 15.20 15.20 13.70 13.70 12.66 12.66 13.66 10.17 8.92 Water: Administration 0.40 1.20 1.20 1.20 1.20 2.29 1.54 1.54 1.54 1.54 Source of supply 0.75 0.75 0.75 0.75 0.75 0.75 0.75 0.75 0.75 0.75 Treatment 11.50 11.75 11.75 11.13 11.50 10.00 10.75 10.75 10.75 10.75 Transmission & distribution 7.50 7.50 8.25 8.25 6.75 7.50 7.50 7.50 8.15 8.15 Water reclamation: Administration 0.40 0.60 0.60 0.60 0.60 0.93 0.93 0.93 0.93 0.93 Treatment 5.75 5.75 6.75 6.37 6.75 6.19 6.19 6.19 6.19 6.19 Collection 1.75 1.75 1.75 3.50 5.00 5.76 5.76 4.76 5.41 4.91 Storm water: Administration - - - - - - - - 0.20 0.20 Collection - - - - - - - - 1.99 1.74 Subtotals 117.96 120.08 124.83 123.58 131.33 130.16 142.30 144.63 144.63 138.23 Source: City of Lafayette CITY OF LAFAYETTE, COLORADO FULL-TIME EQUIVALENT CITY GOVERNMENT EMPLOYEES BY FUNCTION/PROGRAM SCHEDULE 13 Last Ten Fiscal Years 145 ---PAGE BREAK--- 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 Function/Program Parks, open space & golf department Parks & open space: Administration 2.80 2.80 2.80 2.80 2.80 2.17 1.67 1.34 1.34 1.34 Cemeteries - - - 1.31 1.31 1.31 1.31 1.31 1.31 1.31 Parks 9.93 10.91 10.42 9.11 9.11 10.11 10.51 10.51 10.51 10.51 Open space maintenance 1.00 1.00 1.00 1.00 1.00 1.50 2.50 2.50 2.50 2.50 Golf course Administration 0.20 0.20 0.20 0.20 0.20 0.33 0.33 0.66 0.66 0.66 Golf course operations 12.50 12.50 14.27 10.17 11.63 10.63 10.63 10.63 10.63 10.63 Club house operations 7.25 7.25 7.25 5.36 7.25 7.25 7.25 7.25 7.25 7.25 Snack bar operations 3.25 3.25 3.25 3.18 3.72 3.72 3.72 3.72 3.72 3.72 Recreation & facility management dept Recreation & facility management: Administration - - - - - 2.75 3.25 3.25 3.25 3.50 Leisure services 11.25 11.17 10.94 9.94 10.94 9.74 9.24 9.24 9.24 9.49 Recreation 36.03 35.94 34.94 35.94 34.94 28.73 32.41 32.41 32.41 32.66 Building maintenance 5.50 4.25 4.25 4.25 4.25 9.46 10.96 10.96 10.96 10.21 Community life department Library 16.10 17.21 17.21 17.21 17.21 18.04 17.87 17.87 17.22 15.31 Community life - - - - - - - - 0.65 1.00 Senior services 2.00 3.00 3.00 3.50 3.50 3.50 3.50 3.50 3.50 3.50 Subtotals 107.81 109.48 109.53 103.97 107.86 109.24 115.15 115.15 115.15 113.59 Grand totals 225.77 229.56 234.36 227.55 239.19 239.40 257.45 259.78 259.78 251.82 CITY OF LAFAYETTE, COLORADO FULL-TIME EQUIVALENT CITY GOVERNMENT EMPLOYEES BY FUNCTION/PROGRAM SCHEDULE 13 (CONTINUED) Last Ten Fiscal Years 146 ---PAGE BREAK--- 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 Function/Program Police Physical arrests 1,711 1,553 1,486 1,630 1,605 1,492 1,149 1,318 1,200 1,152 Municipal Citations * 3,232 5,140 5,353 4,717 6,850 6,147 6,983 7,152 7,043 Fire Emergency responses 1,376 1,510 1,515 1,411 1,619 1,587 1,879 1,885 1,736 1,578 Inspections conducted 100 100 100 100 100 100 250 330 300 318 Parks, Open Space, Golf Course Golf Course rounds played 42,845 39,710 38,379 37,313 41,778 44,203 43,008 43,022 39,292 36,043 % Resident Play 23% 29% 29% 26% 21% 17% 20% 19% 18% 17% Cemetary plot opening/closings 30 24 27 30 33 29 25 30 35 23 Recreation and Facility Mgmt Individual Annual Passes sold 90 132 168 237 302 315 403 421 381 554 Couple or Family Annual Passes 83 118 140 198 255 242 293 307 303 282 Punch Cards sold 2,469 3,356 3,489 2,881 2,598 2,384 2,524 2,243 2,369 2,217 Total Attendance 227,803 237,266 230,870 222,313 230,367 226,284 235,506 227,175 225,319 228,741 Facilities and services not included in the reporting entity 1: Number of public elem. schools 4 4 4 4 4 4 4 4 4 4 Number of elementary instructors 2 114.6 114.7 98.0 100.1 102.5 107.8 107.7 145.0 143.0 139.0 Number of public middle schools 1 1 1 1 1 1 1 1 1 1 Number of MS instructors 2 46.9 * 42.2 44.5 43.2 38.3 38.1 40.0 38.0 38.0 Charter school (K through 12) 1 1 1 1 1 1 1 1 1 1 Number of public high schools 1 1 1 1 1 1 1 1 1 1 Number of HS instructors 2 61.3 * 58.3 63.3 62.7 61.8 65.5 90.0 82.0 63.0 * Information is unavailable 1 Source: Boulder Valley School District 2 Full-time equivalents CITY OF LAFAYETTE, COLORADO OPERATING INDICATORS BY FUNCTION/PROGRAM SCHEDULE 14 Last Ten Fisal Years 147 ---PAGE BREAK--- 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 Function/Program Police Stations 1 1 1 1 1 1 1 1 1 1 Commissioned officers 36 31 35 37 37 39 40 40 39 39 Fire stations 1 1 1 1 1 1 1 1 1 1 Public works Centerline miles of streets 82 92 94 97 97 97 97 98 98 99 Recreation and culture Recreation center 1 1 1 1 1 1 1 1 1 1 Parks 15 15 15 17 17 18 18 19 19 19 Developed acres 205 205 205 217 230 236 236 236 236 236 Undeveloped acres 74 151 151 151 151 216 216 216 216 216 Open space acres 741 996 996 996 1,042 1,042 1,120 1,120 1,265 1,265 Libraries 1 1 1 1 1 1 1 1 1 1 Senior Center 1 1 1 1 1 1 1 1 1 1 Utilities Water mains (miles) 215 218 227 230 230 230 233 235 235 237 Sanitary sewer (miles) 179 181 184 186 186 186 191 192 192 193 Water connections 7,324 7,439 7,518 7,809 8,097 8,197 8,240 8,267 8,302 8,322 Wastewater connections 6,851 6,942 7,173 7,544 7,571 7,672 7,685 7,651 7,631 7,680 Source: City of Lafayette CITY OF LAFAYETTE, COLORADO CAPITAL ASSET STATISTICS BY FUNCTION/PROGRAM SCHEDULE 15 Last Ten Fiscal Years 148 ---PAGE BREAK--- COMPLIANCE SECTION This section consists of the following: • Local highway finance report 2010 149 ---PAGE BREAK--- 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: City of Lafayette LOCAL HIGHWAY FINANCE REPORT YEAR ENDING: December 2010 This Information From The Records Of (example - City of_ or County of Prepared By: Jill Johnson City of Lafayette Phone: [PHONE REDACTED] I. DISPOSITION OF HIGHWAY-USER REVENUES AVAILABLE FOR LOCAL GOVERNMENT EXPENDITURE A. Local B. Local C. Receipts from D. Receipts from ITEM Motor-Fuel Motor-Vehicle State Highway- Federal Highway ‘I Tr’s m.s A 1. Total receipts available — 2. Minus amount used for collection expenses 3. Minus amount used for nonhighway purposes 4. Minus amount used for mass transit 5. Remainder used for highway purposes II. RECEIPTS FOR ROAD AND STREET PURPOSES III. DISBURSEMENTS FOR ROAD AND STREET PURPOSES ITEM ITEM AMOUNT A. Receipts from local sources: 4. Local highway disbursements: I. Local highway-user taxes 1. Capital outlay (from page 2) 4,193,653 a. Motor Fuel (from Item 1.A.5.) 2. Maintenance: b. Motor Vehicle (from Item I.B.5.) 3. Road and street services: c. Total a. Traffic control operations 2. General fund appropriations b. Snow and ice removal 3. Other local imposts (from page 2) 442,866 c. Other 4. Miscellaneous local receipts (from page 2) 501,846 d. Total through 5. Transfers from toll facilities 4. General administration & miscellaneou 6. Proceeds of sale of bonds and notes: 5. Highway law enforcement and safety a. Bonds - Original Issues 6. Total (1 through 5) b. Bonds - Refunding Issues B. Debt service on local obligations: c. Notes 1. Bonds: d. Total + b. + 0 a. Interest 7. Total (1 through 6) 3,678,810 b. Redemption B. Private Contributions 1,757,927 c. Total + C. Receipts from State governnient 2. Notes: (from page 2) 796,540 a. Interest B. Receipts from Federal Government b. Redemption e2) c. Total 0 (A 7--j 3. Total (i.e + 2.c) 376,941 IC. Payments to State for highways . Payments to toll facilities . Total disbursements (A.6 + B.3 + C + D) 8,784,944 IV. LOCAL HIGHWAY DEBT STATUS (Show all entries at par) Opening Debt Amount Issued Redemptions Closing Debt A. Bonds (Total) I 9,171,175 0 20,882 9,150,293 1. Bonds (Refunding Portion) B. Notes (Total) I I V. LOCAL ROAD AND STREET FUND BALANCE I A. Beginning Balance B. Total Receipts . Total Disbursement D. Ending Balance E. Reconciliation I 4,840,065 6,233,277 I 8,784,944 I 2,288,398 0 FORM FHWA-536 (Rev. 1-05) PRE’, IUU 1i1Jl I IL’lN ULI1ULETE (Next Page) Highway Finance Report - 536 150 ---PAGE BREAK--- 151