CITY of SOUTH BEND, INDIANA Pete Buttigieg, Mayor John Murphy, City Controller Jennifer Hockenhull, Deputy City Controller
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CITY OF SOUTH BEND COMPREHENSIVE ANNUAL FINANCIAL REPORT FISCAL YEAR ENDING ON DECEMBER 31, 2016 CITY OF SOUTH BEND, INDIANA Pete Buttigieg, Mayor John Murphy, City Controller Jennifer Hockenhull, Deputy City Controller REPORT PREPARED BY THE CITY OF SOUTH BEND DEPARTMENT OF ADMINISTRATION AND FINANCE City of South Bend, Indiana Contents Introductory Section City Officials i Controller's Letter of Transmittal ii-xi Certificate of Achievement for Excellence in Financial Reporting xii Organization Chart xiii Financial Section Report Letter 1-3 Management's Discussion and Analysis 4-28 Basic Financial Statements Government-wide Financial Statements: Statement of Net Position 29-30 Statement of Activities 31-32 Fund Financial Statements: Governmental Funds: Balance Sheet 33-34 Reconciliation of the Balance Sheet to the Statement of Net Position 35 Statement of Revenue, Expenditures, and Changes in Fund Balances 36-37 Reconciliation of the Statement of Revenue, Expenditures, and Changes in Fund Balances of Governmental Funds to the Statement of Activities 38 Proprietary Funds: Statement of Net Position 39-40 Statement of Revenue, Expenses, and Changes in Net Position 41 Statement of Cash Flows 42-43 Fiduciary Funds: Statement of Fiduciary Net Position 44 Statement of Changes in Fiduciary Net Position 45 Notes to Financial Statements 46-103 City of South Bend, Indiana Contents (Continued) Required Supplemental Information 104 1925 Police Officers' Pension Plan: Schedule of Investment Returns 105 Schedule of City Contributions 106 Schedule of Changes in the City Net Pension Liability and Related Ratios 107 1937 Firefighters' Pension Plan: Schedule of Investment Returns 108 Schedule of City Contributions 109 Schedule of Changes in the City Net Pension Liability and Related Ratios 110 OPEB System Schedule 111 Public Employees' Retirement Fund: Schedule of City Contributions 112 Schedule of the City's Proportionate Share of the Net Pension Liability 113 1977 Police Officers' Pension and Disability Fund Schedule of City Contributions 114 Schedule of the City's Proportionate Share of the Net Pension Liability 115 1977 Firefighters' Pension and Disability Fund Schedule of City Contributions 116 Schedule of the City's Proportionate Share of the Net Pension Liability 117 Budgetary Comparison Schedules - General Fund and Major Special Revenue Funds: General Fund 118-120 Park and Recreation Fund 121 Public Safety LOIT Fund 122 COIT Fund 123 EDIT Fund 124 Rainy Day Fund 125 Budget/GAAP Reconciliation 126 Notes to Required Supplemental Information 127-128 City of South Bend, Indiana Contents (Continued) Other Supplemental Information 129 Fund Descriptions 130-135 Combining Balance Sheet 136-147 Combining Statement of Revenue, Expenditures, and Changes in Fund Balances 148-159 Schedules of Revenue, Expenditures, and Changes in Fund Balances - Budget and Actual 160-218 Nonmajor Enterprise Funds: Fund Descriptions 219 Combining Statement of Net Position 220 Combining Statement of Revenue, Expenses, and Changes in Net Position 221 Combining Statement of Cash Flows 222-223 Internal Service Funds: Fund Descriptions 224 Combining Statement of Net Position 225 Combining Statement of Revenue, Expenses, and Changes in Net Position 226 Combining Statement of Cash Flows 227-228 Fiduciary Funds: Fund Descriptions 229 Statement of Assets and Liabilities 230 Combining Statement of Changes in Fiduciary Net Position 231 Statement of Changes in Assets and Liabilities 232 City of South Bend, Indiana Contents (Continued) Statistical Section Financial Trend Information: Net Position by Component 233 Changes in Net Position 234-236 Fund Balances - Governmental Funds 237 Changes in Fund Balances - Governmental Funds 238 Revenue Capacity Information: Property Tax Levies and Collections 239 Direct and Overlapping Property Tax Rates 240 Detail of Net Assessed Valuation 241 Assessed Value and Actual Value of Taxable Property 242 Net Assessed Value of Taxable Property 243 Assessed Value of Taxable Property 244 Property Tax Collections - Cash Basis 245 2016 Circut Breaker Property Tax Cap Credits 246 Principal Property Taxpayers 247 Local Option Income Tax Revenue (CEDIT) 248 Local Option Income Tax Revenue (COIT) 249 Local Option Income Tax Revenue (PS LOIT) 250 Total County Income Tax Distributions by Taxing Unit 251 Ten Largest Water Customers 252 Ten Largest Sewage Works Customers 253 Gasoline Tax Collections - Cash Basis 254 Wheel and Excise Surtax Collections - Cash Basis 255 Hotel/Motel Tax Revenue - Cash Basis - City Distributions 256 Professional Sports Development (PSDA) Tax - Cash Basis 257 Cable Television Franchise Fee Collections - Cash Basis 258 Debt Capacity Information: Computation of Legal Debt Margin 259 Legal Debt Margin Information 260 Ratios of Outstanding Debt by Type 261 Computation of Direct and Overlapping Debt 262 Ratio of Annual Debt Service Expenditures for General Obligation Bonded Debt to Total General Government Expenditures 263 Ratio of Net General Obligation Bonded Debt to Assessed Value and Net Bonded Debt Per Capita 264 St. Joseph County Hotel/Motel Tax Board Statement of Estimated Cash Flow and Debt Service Coverage 265 Schedule of Revenue Bond Coverage - Water Utility Bonds 266 Schedule of Revenue Bond Coverage - Wastewater Utility Bonds 267 Municipal Sewage Works Annual Wastewater Flow Data and Number of Customers 268 City of South Bend, Indiana Contents (Continued) Statement of City-Owned Utility Debt 269 Estimated Debt Service Coverage Calculation of Sewage Works 270 Estimated Debt Service Coverage Calculation of Water Utility 271 Projected City of South Bend COIT Revenue 272 Projected City of South Bend CEDIT Revenue 273 Projected City of South Bend LOIT Revenue 274 Statement of Estimated Cash Flow and Debt Service Coverage (COIT) 275 Statement of Estimated Cash Flow and Debt Service Coverage (CEDIT) 276 Estimated Tax Increment Revenue - Erskine Village Project 277 Demographic and Economic Information: Demographic Statistics 278-279 Employment by Type and Industry 280 Comparison of Growth Rates in Personal Income for St. Joseph County, the State of Indiana, and U.S. Personal Income 281 Principal Employers 282 Operating Information: Operating Indicators by Function/Program 283 Capital Asset and Infrastructure Statistics by Function/Program 284 New Construction - Number of Permits and Property Values 285 Full-Time City Government Employees by Department 286-287 Salary Rate Comparison 288 Insurance Coverage 289 Financial Institutions 290 Miscellaneous Statistics 291-292 CITY OFFICIALS Office Official Term Mayor Pete Buttigieg 01-01-16 to 12-31-19 Controller John Murphy 01-01-16 to 12-31-16 City Clerk Kareemah Fowler 01-01-16 to 12-31-19 President of the Board of Public Works Gary A. Gilot 01-01-12 to 12-31-16 Common Council Members 1st District Tim Scott 01-01-16 to 12-31-19 2nd District Regina Williams-Preston 01-01-16 to 12-31-19 3rd District Randy Kelly 01-01-16 to 12-31-19 4th District Jo M. Borden 01-01-16 to 12-31-19 5th District David Varner 01-01-16 to 12-31-19 6th District Oliver Davis 01-01-16 to 12-31-19 At Large Karen L. White 01-01-16 to 12-31-19 At Large John Voorde 01-01-16 to 12-31-19 At Large Gavin Ferlic 01-01-16 to 12-31-19 i 1200N COUNTY-CITY BUILDING PHONE 574/ 235-7678 227 W. JEFFERSON BLVD. FAX 574/ 235-9928 SOUTH BEND, INDIANA 46601-1830 CITY OF SOUTH BEND PETE BUTTIGIEG, MAYOR DEPARTMENT OF ADMINISTRATION AND FINANCE June 30, 2017 The Honorable Pete Buttigieg, Mayor of the City of South Bend Members of the City of South Bend Common Council Residents of the City of South Bend: The comprehensive annual financial report of the City of South Bend, Indiana (the "City") for the year ended December 31, 2016 is hereby submitted. Responsibility for both the accuracy of the data and the completeness and fairness of the presentation, including all disclosures, rests with management. To the best of our knowledge and belief, the enclosed data is accurate in all material respects and is reported in a manner designed to present fairly the financial position and results of operations of the various funds of the City. All disclosures necessary to enable the reader to gain an understanding of the government’s financial activities are included. Generally Accepted Accounting Principles (GAAP) requires that management provide a narrative introduction, overview and analysis to accompany the basic financial statements in the form of the Management’s Discussion and Analysis (MD&A). This letter of transmittal is designed to complement the MD&A and should be read in conjunction with it. The City of South Bend’s MD&A can be found immediately following the independent auditors’ report. The Comprehensive Annual Financial Report is presented in four sections: introductory information, financial information, statistical information and federal compliance information. The introductory section includes this transmittal letter, the City’s organizational chart, a list of principal City officials and the Certificate of Achievement for Excellence in Financial Reporting awarded to the City of South Bend for the year ending December 31, 2015. The financial section begins with the independent auditors’ report on the City’s financial statements and schedules, the City managements’ discussion and analysis report, followed by the City’s basic financial statements and accompanying notes. The remaining portion of this section includes the combining and individual fund and other financial statements and schedules. The statistical section includes selected financial and demographic information generally presented on a multi-year basis, which has been provided to give the reader a broader understanding of the City. The federal awards compliance section, which includes the results of the supplemental audit of the City’s federal awards and the internal controls necessary for compliance, is included in a separate report. The City is required to undergo an annual single audit in conformity with the provisions of the U.S. Office of Management and Budget Circular A-133, Audits of States, Local Governments and Non-Profit Organizations, the provisions of Indiana Code section 5-11-1-9 and the requirements of the Indiana State Board of Accounts.