City of Pittsburgh, Pennsylvania
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CITY OF PITTSBURGH, PENNSYLVANIA COMPREHENSIVE ANNUAL FINANCIAL REPORT YEAR ENDED DECEMBER 31, 2015 Michael E. Lamb, City Controller CITY OF PITTSBURGH PENNSYLVANIA CITY OF PITTSBURGH, PENNSYLVANIA COMPREHENSIVE ANNUAL FINANCIAL REPORT YEAR ENDED DECEMBER 31, 2015 CITY OF PITTSBURGH, PENNSYLVANIA COMPREHENSIVE ANNUAL FINANCIAL REPORT YEAR ENDED DECEMBER 31, 2015 TABLE OF CONTENTS Page No. INTRODUCTORY SECTION Letter of Transmittal I-1 GFOA Certificate of Achievement I-8 Organizational Chart I-9 Elected City Officials I-10 FINANCIAL SECTION Independent Auditor's Report Management’s Discussion and Analysis i Basic Financial Statements: Government-wide Financial Statements: Statement of Net Position 1 Statement of Activities 3 Fund Financial Statements: Balance Sheet – Governmental Funds 4 Reconciliation of the Balance Sheet of Governmental Funds to the Statement of Net Position 6 Statement of Revenues, Expenditures, and Changes in Fund Balance – Governmental Funds 7 Reconciliation of the Statement of Revenues, Expenditures, and Changes in Fund Balance of Governmental Funds to the Statement of Activities 8 Statement of Revenues, Expenditures, and Changes in Fund Balance – Budget and Actual (Non-GAAP Budgetary Basis) – General Fund 9 Statement of Revenues, Expenditures, and Changes in Fund Balance – Budget and Actual (Non-GAAP Budgetary Basis) – Community Development Fund 14 CITY OF PITTSBURGH, PENNSYLVANIA COMPREHENSIVE ANNUAL FINANCIAL REPORT YEAR ENDED DECEMBER 31, 2015 TABLE OF CONTENTS (Continued) Page No. Fiduciary Fund Statements: Statement of Net Position – Fiduciary Funds 16 Statement of Changes in Net Position – Fiduciary Funds 17 Combining Statements of Discrete Component Units: Combining Statement of Net Position – Component Units 18 Statement of Activities – Component Units 20 Notes to Financial Statements 21 Required Supplementary Information: Pension Trust Fund Disclosures: Schedule of Changes in the City’s Net Pension Liability and Related Ratios – Pension Plan 95 Schedule of the City’s Contributions and Investment Returns 96 Note to Required Supplementary Information – Pension Plan 97 Schedule of Funding Progress – Other Postemployment Benefit Plans 98 Supplementary Information: Combining and Individual Other Fund Statements and Schedules: Combining Balance Sheet – Nonmajor Governmental Funds 99 Combining Statement of Revenues, Expenditures, and Changes in Fund Balance – Nonmajor Governmental Funds 100 Combining Statement of Net Position – Pension Trust Funds 101 Combining Statement of Changes in Net Position – Pension Trust Funds 102 Agency Funds: Statement of Changes in Assets and Liabilities 103 CITY OF PITTSBURGH, PENNSYLVANIA COMPREHENSIVE ANNUAL FINANCIAL REPORT YEAR ENDED DECEMBER 31, 2015 TABLE OF CONTENTS (Continued) Page No. Capital Projects Fund: Combining Schedule of Revenues, Expenditures, and Changes in Fund Balance – Budget and Actual (Non-GAAP Budgetary Basis) 104 Budgetary Comparison Schedule 105 STATISTICAL SECTION Net Position by Component – Last Ten Years 106 Changes in Net Position - Last Ten Years 107 Program Revenues by Function/Program - Last Ten Years 108 Fund Balances, Governmental Funds - Last Ten Years 109 Changes in Fund Balances, Governmental Funds - Last Ten Years 110 Governmental Fund Tax Revenues by Sources - Last Ten Years 112 Assessed Valuation and Estimated Actual Values of Taxable Property - Last Ten Years 113 Property Tax Rates - Direct and Overlapping Governments - Last Ten Years 114 Principal Property Taxpayers - Current Year and Nine Years Ago 115 Assessed Value, Tax Rate, Levy, and Collections - Last Ten Years 116 Ratios of Outstanding Debt by Type – Last Ten Years 117 Ratio of Net General Obligation Bonded Debt to Assessed Value and Net General Obligation Bonded Debt Per Capita - Last Ten Years 118 Ratio of Annual Debt Service Expenditures for General Obligation Bonded Debt to Total General Governmental Expenditures - Last Ten Years 119 Computation of Direct and Overlapping Debt 120 Net Debt and Remaining Debt Incurring Margin in Accordance with Act No. 52, Approved April 28, 1978 - Local Government Unit Debt Act 121 Legal Debt Margin Information - Last Ten Years 123 Revenue Bond Coverage - Pittsburgh Water and Sewer Authority - Last Ten Years 124 CITY OF PITTSBURGH, PENNSYLVANIA COMPREHENSIVE ANNUAL FINANCIAL REPORT YEAR ENDED DECEMBER 31, 2015 TABLE OF CONTENTS (Continued) Page No. Revenue Bond Coverage - The Stadium Authority of the City of Pittsburgh - Last Ten Years 125 Demographic and Economic Statistics - Last Ten Years 126 Principal Employers - Current Year and Ten Years Ago 127 Property Value, Construction, and Bank Deposits - Last Ten Years 128 City Employment - Last Ten Years 129 Full-Time Equivalent Municipal Employees by Function/Program - Last Ten Years 130 OTHER INFORMATION Salaries and Surety Bonds of Principal Officials 131 Schedule of Bonds and Notes Payable 132 INTRODUCTORY SECTION I - 8 City of Pittsburgh Organization Chart Citizens of Pittsburgh City Council Mayor City Controller Office of Department of Management & Innovation & City Clerk Budget Performance Department of Department of Law Finance Personnel & Civil Equipment Leasing Environmental Department of City Pittsburgh Water & Service Bureau of Police Authority Services Planning Sewer Authority Commission Department of Department of Sports & Exhibition Operations Public Works - Public Safety - Bureau of Fire Pension Plans Authority Administration Administration Department of Bureau of Transportation & Department of Stadium Authority Permits, Licenses, Emergency Medical Housing Authority Engineering Parks & Recreation & Inspections Services Urban Office of Municipal Commission on Bureau of Animal Redevelopment Parking Authority Investigations Human Relations Care & Control Authority Bureau of Neighborhood Empowerment Citizen Police Review Board CITY OF PITTSBURGH, PENNSYLVANIA ELECTED CITY OFFICIALS As of April 27, 2016 MAYOR William Peduto CONTROLLER Michael E. Lamb MEMBERS OF COUNCIL Bruce Kraus, President, District 3 Natalia Rudiak, Finance/Law Committee, District 4 Darlene M. Harris, District 1 Theresa Kail-Smith, District 2 Corey O’Connor, District 5 R. Daniel Lavelle, District 6 Deborah Gross, District 7 Daniel Gilman, District 8 Rev. Ricky Burgess, District 9 I - 10 FINANCIAL SECTION Pittsburgh Harrisburg Butler 503 Martindale Street 3003 North Front Street 112 Hollywood Drive Suite 600 Suite 101 Suite 204 Pittsburgh, PA 15212 Harrisburg, PA 17110 Butler, PA 16001 Main 412.471.5500 Main 717.232.1230 Main 724.285.6800 Fax 412.471.5508 Fax 717.232.8230 Fax 724.285.6875 Independent Auditor’s Report The Honorable Members of Council City of Pittsburgh, Pennsylvania Report on the Financial Statements We have audited the accompanying financial statements of the governmental activities, the aggregate discretely presented component units, each major fund, and the aggregate remaining fund information of the City of Pittsburgh, Pennsylvania (City), as of and for the year ended December 31, 2015, and the related notes to the financial statements, which collectively comprise the City's basic financial statements, as listed in the table of contents. Management’s Responsibility for the Financial Statements Management is responsible for the preparation and fair presentation of these financial statements in accordance with accounting principles generally accepted in the United States of America; this includes the design, implementation, and maintenance of internal control relevant to the preparation and fair presentation of financial statements that are free from material misstatement, whether due to fraud or error. Auditor’s Responsibility Our responsibility is to express opinions on these financial statements based on our audit. We did not audit the financial statements of the Stadium Authority of the City of Pittsburgh (Stadium Authority), which represent 3.1%, (0.2%), and 2.2%, respectively of the assets and deferred outflows, net position, and revenues of the aggregate discretely presented component units. These statements were audited by other auditors whose report has been furnished to us, and our opinion, insofar as they relate to the amounts included for the Stadium Authority, is based solely upon the report of the other auditor. We conducted our audit in accordance with auditing standards generally accepted in the United States of America. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the financial statements. The procedures selected depend on the auditor’s judgment, including the assessment of the risks of material misstatement of the financial statements, whether due to fraud or error. In making those risk assessments, the auditor considers internal control relevant to the entity’s preparation and fair presentation of the financial statements in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the entity’s internal control. Accordingly, we express no such opinion. An audit also includes evaluating the appropriateness of accounting policies used and the reasonableness of significant accounting estimates made by management, as well as evaluating the overall financial statement presentation of the financial statements. We believe that the audit evidence we have obtained is