CHICAGO PARK DISTRICT CHICAGO, ILLINOIS Comprehensive Annual Financial Report For the year ended December 31, 2007 Steve Hughes, Chief Financial Officer Constance M. Kravitz, CPA, Comptroller July 23, 2008 To the Citizens of Chicago and the Financial Community: As Superintendent and CEO of the Chicago Park District (Park District), I am Administration Office proud to present the Comprehensive Annual Financial Report (CAFR) for the 541 North Fairbanks fiscal year 2008. Chicago, Illinois 60611 t (312) 742-PLAY As a measure of the ParkChicago District’s financial Park District health, the CAFR indicates a (312) 747-2001 TTY www.chicagoparkdistrict.com steadily improving picture as we continue to impose financial and managerial discipline on all aspectsBoard of the Parkof Commissioners District’s operations. Board of Commissioners Gery J. Chico The history of Chicago parks dates back to the early 1800s. In fact, the earliest President city park, Dearborn MaríaPark (located N. Saldaña on the land – Presidentcurrently occupied by the Chicago Cultural Center) was developed in 1839, laying the groundwork for what would Bob Pickens be one of the largest,Bob most Pickens impressive – Vicepark systems President in the nation. Vice President Over the years, Chicago parks have developed a history of welcoming the world Dr. Margaret T. Burroughs to our great city. In 1893,Dr. weMargaret hosted the T, World’s Burroughs Columbian Exposition in what is M. Laird Koldyke now Jackson Park and then in 1933 and 1934, hosted the second World’s Fair, Reverend Daniel Matos-Real Rouhy J. Shalabi “A Century of Progress” in BurnhamM. Laird Park. Koldyke Even then, Burnham, Olmstead, and other pioneering planners understood and General Superintendent Reverend Daniel Matos-Real & CEO believed in the importance of parks and open space to quality of life. That Timothy J. Mitchell understanding and belief are as significant today as nearly 100 years ago. Cindy Mitchell As Superintendent and CEO, I carry the responsibility and great privilege of City of Chicago ensuring that each of the 77 communities across the city is equipped with Richard M. Daley Rouhy J. Shalabi Mayor recreational facilities that enhance the quality of life for its residents. To achieve this goal, the Park District’s efforts are guided by four core values: open, active, green, connected. We will continue to work to eliminate architectural barriers and enhance programs to include all participants regardless of age, physical, or cognitive ability. In addition, we will enhance existing opportunities that encourage families to get active and adopt healthy lifestyles. As environmental stewards of our great city, we will continue to implement eco-friendly practices into the Park District’s operations. In addition, we will provide opportunities in the parks for residents to learn how they can help. Finally, we will connect with park advisory councils, elected officials, and corporations committed to improving our parks. It is through these partnerships that the Park District and communities across the city are able to celebrate the many improvements in our parks. Thank you for your interest in the Chicago Park District’s Comprehensive Annual Financial Report. Sincerely, Timothy J. Mitchell General Superintendent & CEO Chicago Park District 2007 COMPREHENSIVE ANNUAL FINANCIAL REPORT CHICAGO PARK DISTRICT Table of Contents PART I – INTRODUCTORY SECTION (Unaudited) Letter of Transmittal 5 Certificate of Achievement for Excellence in Financial Reporting 13 Organization Chart 14 PART II – FINANCIAL SECTION Independent Auditors’ Report 17 Management’s Discussion and Analysis 19 Basic Financial Statements Government-wide Financial Statements: Statement of Net Assets 33 Statement of Activities 34 Fund Financial Statements: Balance Sheet – Governmental Funds 36 Reconciliation of the Governmental Funds Balance Sheet to the Statement of Net Assets 39 Statement of Revenues, Expenditures, and Changes in Fund Balances – Governmental Funds 40 Reconciliation of the Governmental Funds Statement of Revenues, Expenditures, and Changes in Fund Balances to the Statement of Activities 42 Statement of Fiduciary Net Assets – Fiduciary Funds 43 Statement of Changes in Fiduciary Net Assets – Fiduciary Funds 44 Notes to Basic Financial Statements 45 Required Supplementary Information Budgetary Comparison Information – Major Funds: Schedules of Revenues and Expenditures – Budget and Actual (Budgetary Basis) 77 Notes to Budgetary Comparison Schedules 79 Pension: Schedule of Funding Progress 80 Notes to Schedule of Funding Progress 81 Combining Fund Statements and Schedules Nonmajor Governmental Funds: Combining Balance Sheet 84 Combining Statement of Revenues, Expenditures, and Changes in Fund Balance 86 Combining Schedule of Revenues – Budget and Actual (Budgetary Basis) 88 Combining Schedule of Expenditures – Budget and Actual (Budgetary Basis) 90 PART III – STATISTICAL SECTION (Unaudited) Statistical Section Table of Contents 94 1 (This page intentionally left blank) 2 Part I INTRODUCTORY SECTION 3 (This page intentionally left blank) 4 To the Honorable Mayor Richard M. Daley, General Superintendent & CEO Timothy J. Mitchell, Members of the Board of Commissioners, and Citizens of the City of Chicago: Administration Office We are pleased to submit the Comprehensive Annual Financial Report (CAFR) 541 North Fairbanks Chicago, Illinois 60611 of the Chicago Park District (District) for the year ended December 31, 2007. t (312) 742-PLAY State of Illinois (State) Law specifies that the District prepares and prints a (312) 747-2001 TTY complete and detailed report and financial statement of the District’s operations www.chicagoparkdistrict.com and of the District’s assets and liabilities as soon as the end of each fiscal year Board of Commissioners as may be expedient. Additionally, a reasonable sufficient number of copies of Gery J. Chico such report shall be delivered to the appropriate committee of the Chicago City President Council. This report is published to fulfill that requirement for the fiscal year ended December 31, 2007. Bob Pickens Vice President A further requirement of the District, as per ordinance known as the “Code of the Dr. Margaret T. Burroughs Chicago Park District” (Code), is the necessity to prepare an annual statement M. Laird Koldyke giving a full and detailed accounting of all receipts and expenditures during the Reverend Daniel Matos-Real preceding fiscal year. Such statements shall also detail the liabilities and Rouhy J. Shalabi resources of the District, and all other things necessary to exhibit its true General Superintendent financial condition. Said annual statement shall be accompanied by the & CEO certificate of a certified public accountant not connected with the District and Timothy J. Mitchell who has been appointed by the Board of Commissioners (Board). Such accountant shall certify that the statements contained in the Comptroller’s report are the true reflections of the books of his/her office, which books have been City of Chicago Richard M. Daley correctly kept. Upon completion, it shall be transmitted to the Board at the Mayor annual meeting. In addition to meeting the requirements set forth in the Code, additional audit and compliance requirements are necessary as described in the U.S. Office of Management and Budget (OMB) Circular A-133, Audits of State and Local Governments. Additionally, the Government Account Audit Act, the Illinois Municipal Audit Law, and the County Audit Law require local governments to submit a report, including financial statements, compiled in accordance with generally accepted accounting principles (GAAP) and a corresponding auditors’ report on the financial statements. Audits are required to be performed by a licensed public accountant and submitted to the State’s Office of the Comptroller on an annual basis. These financial statements are required to be audited annually in accordance with generally accepted auditing standards (GAAS). KPMG LLP, Certified Public Accountants, have issued an unqualified (“clean”) opinion on the District’s financial statements for the year ended December 31, 2007. The audit was conducted as a subcontractor arrangement between KPMG LLP and a Chicago-based minority- and women-owned certified public accounting firm. The independent auditors’ report is located at the front of the financial section of this report. Management assumes full responsibility for both the completeness and reliability of the information contained in this report, based upon a comprehensive framework of internal control that it has established for this 5 comprehensive framework of internal control that it has established for this purpose. Because the cost of internal control should not exceed anticipated benefits, the objective is to provide reasonable, rather than absolute, assurance that the financial statements are free of any material misstatements. This CAFR is also intended to meet the purpose of providing Continuing Disclosure requirements as set forth in each Official Statement, for the benefit of beneficial owners of the District Bonds subject to disclosure, and in order to assist the participating Underwriters in complying with the requirements of Rule 15c2-12 of the Securities and Exchange Act of 1934, through submissions made to the Municipal Securities Rulemaking Board, Nationally Recognized Municipal Securities Information Repositories. GAAP requires that management provide a narrative introduction, overview, and analysis to accompany