Comprehensive Annual Financial Report

CITY OF ORLANDO, FLORIDA COMPREHENSIVE ANNUAL FINANCIAL REPORT Ivey Lane park FOR THE FISCAL YEAR ENDED SEPTEMBER 30, 2018 COMPREHENSIVE ANNUAL FINANCIAL REPORT City of Orlando, Florida For the Fiscal Year Ended September 30, 2018 Prepared by: Office of Business and Financial Services This page intentionally blank. ~ ~ CITY OF ORLANDO ELECTED OFFICIALS BUDDY DYER Mayor JIM GRAY TONY ORTIZ ROBERT F. STUART District l Commissioner District 2 Commissioner District 3 Commissioner PATTY SHEEHAN REGINA I. HILL SAMUEL B. INGS District 4 Commissioner District 5 Commissioner District 6 Commissioner This page intentionally blank. CITY OF ORLANDO, FLORIDA COMPREHENSIVE ANNUAL FINANCIAL REPORT FOR THE FISCAL YEAR ENDED SEPTEMBER 30, 2018 TABLE OF CONTENTS Page I. INTRODUCTORY SECTION Letter of Transmittal 1 Certificate of Achievement for Excellence in Financial Reporting 7 Organization Chart 9 List of Officials 11 II. FINANCIAL SECTION Independent Auditor’s Report 13 A. MANAGEMENT’S DISCUSSION AND ANALYSIS (required supplementary information) 15 B. BASIC FINANCIAL STATEMENTS Government-Wide Financial Statements Statement of Net Position 33 Statement of Activities 34 Fund Financial Statements Governmental Fund Financial Statements Balance Sheet 36 Reconciliation of the Balance Sheet of Governmental Funds to the Statement of Net Position 37 Statement of Revenues, Expenditures, and Changes in Fund Balances 38 Reconciliation of the Statement of Revenues, Expenditures, and Changes in Fund Balances of Governmental Funds to the Statement of Activities 39 Proprietary Fund Financial Statements Statement of Net Position – Business-type Activities – Enterprise Funds – Governmental Activities – Internal Service Funds 42 Statement of Revenues, Expenses, and Changes in Net Position – Business-type Activities – Enterprise Funds – Governmental Activities – Internal Service Funds 44 Statement of Cash Flows – Business-type Activities – Enterprise Funds – Governmental Activities – Internal Service Funds 46 Fiduciary Fund Financial Statements Statement of Fiduciary Net Position 52 Statement of Changes in Fiduciary Net Position 53 Component Unit Fund Financial Statements Statement of Net Position 54 Statement of Activities 55 Notes to Financial Statements Note 1 - Summary of Significant Accounting Policies 58 Note 2 - Stewardship, Compliance, and Accountability 70 Note 3 - Property Taxes 71 Note 4 - Deposits and Investments 72 Note 5 - Net Position, Fund Balance, Interfund Transfers, Receivables and Payables, and Restricted Assets 86 Note 6 - Capital Assets 90 Note 7 - Commitments and Contingencies 91 Note 8 - Risk Management 95 CITY OF ORLANDO, FLORIDA COMPREHENSIVE ANNUAL FINANCIAL REPORT FOR THE FISCAL YEAR ENDED SEPTEMBER 30, 2018 TABLE OF CONTENTS (Continued) Page Notes to Financial Statements (continued) Note 9 - Leases 97 Note 10 - Long-Term Obligations 98 Note 11 - Pension Plans 112 Note 12 - Other Employee Benefits 122 Note 13 - Other Post Employment Benefits 122 Note 14 - Tax Abatements 133 Note 15 - Component Unit 134 Note 16 - Joint Venture 134 Note 17 - Other Organizations 135 Note 18 - Summary Disclosure of Significant Contingencies 136 Note 19 - CRA Trust Funds 138 Note 20 - Downtown South Neighborhood Improvement District (NID) 139 Note 21 - Prior Period Adjustment 140 Note 22 - Subsequent Events 141 C. REQUIRED SUPPLEMENTARY INFORMATION (other than MD&A) Budget to Actual Comparison – Major Funds (General and Special Revenue) General Fund 144 Community Redevelopment Agency 145 Pension and Other Post Employment Benefits (OPEB) Schedules Schedules of Changes in Net Pension Liability - Defined Benefit Pension Plans 148 Schedules of Contributions - Defined Benefit Pension Plans 151 Schedule of Investment Returns - Defined Benefit Pension Plans 154 Schedule of Net Pension Liability - Defined Benefit Pension Plans 155 Schedule of Changes in Net OPEB Liability and Related Ratios 156 Schedule of Contributions - OPEB 157 Schedule of Investment Returns - OPEB 158 Schedule of Changes in Net LTD OPEB Liability and Related Ratios 159 Schedule of Contributions - LTD OPEB 160 Schedule of Investment Returns - LTD OPEB 161 D. COMBINING FINANCIAL STATEMENTS AND SCHEDULES Community Redevelopment Agency Balance Sheet 164 Statement of Revenues, Expenditures, and Changes in Fund Balance 166 Non-Major Governmental Funds Balance Sheet 170 Statement of Revenues, Expenditures, and Changes in Fund Balance 174 Budget to Actual Comparison Other Major and Non-Major Governmental Funds Capital Improvement Fund (Major Fund) 177 Housing and Urban Development (HUD) Grants 178 CITY OF ORLANDO, FLORIDA COMPREHENSIVE ANNUAL FINANCIAL REPORT FOR THE FISCAL YEAR ENDED SEPTEMBER 30, 2018 TABLE OF CONTENTS (continued) Page Budget to Actual Comparison Other Major and Non-Major Governmental Funds (continued) State Housing Partnership (SHIP) Fund 179 Grant Fund 180 Forfeitures Act 181 Special Assessments 182 Downtown South Neighborhood Improvement District 183 H.P. Leu Gardens 184 Cemetery Fund 185 Building Code Enforcement 186 GOAA Police Fund 187 Gas Tax Fund 188 Impact Fees 189 Public Safety Construction Fund 190 Internal Service Funds Statement of Net Position 192 Statement of Revenues, Expenses, and Changes in Fund Net Position 194 Statement of Cash Flows 196 Fiduciary Funds Statement of Fiduciary Net Position 202 Statement of Changes in Fiduciary Net Position 204 Agency Fund, Statement of Changes in Assets and Liabilities 206 E. SUPPLEMENTAL INFORMATION Summary of Debt Service Requirements to Maturity 208 Statements of Bonded Debt and Interest Primary Government Community Redevelopment Agency Downtown District Tax Increment Bonds 210 Republic Drive (Universal Boulevard) Tax Increment Revenue Refunding Bonds 213 Conroy Road Tax Increment Revenue Refunding Bonds 215 Capital Improvement Special Revenue Bonds 216 Wastewater System Revenue Bonds 231 Orlando Venues State Sales Tax and Tourist Development Tax Bonds 232 III. STATISTICAL SECTION Financial Trends Net Position by Component 239 Changes in Net Position 240 Fund Balances of Governmental Funds 243 Changes in Fund Balances of Government Funds 244 Revenue Capacity Assessed Value and Estimated Actual Value of Taxable Property 246 Direct and Overlapping Property Tax Rates 247 Principal Property Taxpayers 248 Property Tax Levies and Collections 249 CITY OF ORLANDO, FLORIDA COMPREHENSIVE ANNUAL FINANCIAL REPORT FOR THE FISCAL YEAR ENDED SEPTEMBER 30, 2018 TABLE OF CONTENTS (Continued) Page III. STATISTICAL SECTION (continued) Debt Capacity Ratios of Outstanding Debt by Type 250 Ratios of General Bonded Debt Outstanding 251 Direct and Overlapping Governmental Activities Debt 252 Pledged-Revenues Coverage Primary Government Community Redevelopment Agency - Downtown District 253 Community Redevelopment Agency - Republic Drive (Universal Boulevard) District 254 Community Redevelopment Agency - Conroy Road District 255 Water Reclamation System 256 Internal Loan Fund Revenue Dilution Test 257 Orlando Venues 258 Demographic and Economic Information Demographic and Economic Statistics 260 Principal Employers 261 Operating Information Full Time Equivalent City Government Employees by Function/Program 262 Operating Indicators by Function/Program 263 Capital Assets Statistics by Function/Program 264 IV. SINGLE AUDIT/GRANTS COMPLIANCE Schedule of Expenditures of Federal Awards and State Financial Assistance 266 Notes to Schedule of Expenditures of Federal Awards and State Financial Assistance 271 Independent Auditor's Report on Compliance for Each Major Federal Program and Major State Project and on Internal Control over Compliance and Report on Schedule of Expenditures 272 Schedule of Findings and Questioned Costs 275 Independent Auditor's Report on Internal Control Over Financial Reporting and on Compliance and Other Matters Based on an Audit of Financial Statements Performed in Accordance with Government Auditing Standards 277 :): CI TYOF r~,oRLANDO March 26, 2019 Mayor Buddy Dyer, City Commissioners, and Citizens of the City of Orlando It is our pleasure to submit this Comprehensive Annual Financial Report (CAFR) for the City of Orlando, Florida for the fiscal year ended September 30, 2018. The report fulfills the requirements set forth by State law, in accordance with Section 218.39, Florida Statutes, and Chapter 10.550 Rules of the Auditor General, which requires that all general purpose local governments publish each fiscal year a complete set of financial statements presented in conformity with Generally Accepted Accounting Principles in the United States (GAAP) and audited in accordance with auditing standards generally accepted in the United States by a firm of licensed certified public accountants. This CAFR consists of management’s representations concerning the finances of the City of Orlando. Consequently, management assumes full responsibility for the completeness and reliability of all of the information presented in this report. To provide a reasonable basis for making these representations, management of the City of Orlando has established a comprehensive internal control framework that is designed both to protect the City’s assets from loss, theft, or misuse and to compile sufficient reliable information for the preparation of the City of Orlando’s financial statements in conformity with GAAP. Because the cost of internal controls should not outweigh their benefits, the City of Orlando’s comprehensive framework of internal controls has been designed to provide reasonable rather than absolute assurance that the financial

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