SOUTH FLORIDA REGIONAL TRANSPORTATION AUTHORITY COMPREHENSIVE ANNUAL FINANCIAL REPORT FISCAL YEAR ENDED JUNE 30, 20177
A Component Unit of the State of Florida Department of Transportation
SOUTH FLORIDA REGIONAL TRANSPORTATION AUTHORITY COMPREHENSIVE ANNUAL FINANCIAL REPORT
A Component Unit of the State of Florida Department of Transportation
FISCAL YEAR ENDED JUNE 30, 2017 Prepared by Finance Department Accounting Division
JACK L. STEPHENS C. MIKEL OGLESBY Executive Director Deputy Executive Director
RICHARD D. CHESS, MBA MARGARET DALLEY-JOHNS, CPA Director of Finance Accounting Manager This page is intentionally left blank MESSAGE FROM THE EXECUTIVE DIRECTOR
As I write this message, the South Florida Regional Transportation Authority has just survived the effects of Hurricane Irma. Although the course of the storm changed and South Florida did not experience the full extent of its power, the corridor did sustain significant enough damage to cause a one week service suspension. Fortunately, after removing the miles of trees that covered the tracks and the successful restoration of power, Tri-Rail resumed operation to serve the thousands of riders who depend on the system to get them where they need to be every day.
Fiscal Year 2017 brought with it challenges and accomplishments. Just prior to the close of FY 2017, the SFRTA moved into its new Operations Center adjacent to the Pompano Beach Station. The move has enabled SFRTA to consolidate virtually all of its functions, including operations, dispatching, administration and outreach into one facility. This has significantly enhanced communications and has enabled the SFRTA to more effectively and efficiently serve its passengers.
With the South Florida economic climate continuing to show improvement, we are continuing to see ridership in excess of 4 million passengers annually. More than 1 million passengers availed themselves of our free connecting shuttle service during the past fiscal year. SFRTA continues to operate 50 trains each weekday and 30 trains on Saturday, Sunday and holidays.
The most exciting development on the horizon is a partnership with All Aboard Florida (AAF) that will provide a one-seat ride into downtown Miami. AAF is helping to defray the cost of Tri-Rail’s new MiamiCentral by generously donating land for the station, as well as amortizing construction costs to the SFRTA’s benefit. Service into Miami is expected to begin sometime within FY18.
Cities along the FEC corridor have been clamoring for commuter rail service to the east. The construction of MiamiCentral is the first step toward bringing that vision to a reality. Tri-Rail Coastal Link could potentially provide direct access to the downtowns of cities as far north as Jupiter, with Miami serving as its southern terminus.
During FY 2018, we look forward to the opening of the new Pompano Beach Station, which will be the first LEED-certified station on the corridor; energy efficient and environmentally sensitive. It will provide 110% of the necessary power to operate the station through solar panels. It will have electric car charging stations and will be landscaped with native vegetation. There will be a projected savings of 85% over the cost of operating our existing stations due to the self-generated solar power source. Included in the project is also a new Parking Garage, which houses the solar panels to power the station, and the new Operations Center.
Mobilization began in FY17 to implement a new contract which bundled together the operations, equipment maintenance, station maintenance and dispatch functions. The approximately $500 million dollar contract was awarded through the competitive RFP process to Herzog Transit Services, Inc. By bundling the contract, the SFRTA hopes to achieve greater accountability and efficiencies from its contractor.
SFRTA will continue to work with CSXT, Florida Department of Transportation, and Amtrak to unify our efforts in the implementation of Positive Train Control (PTC). PTC will assist in train control, preventing train-to-train collisions, over-speed derailments, incursion into established work zones and movement through a main line switch in the improper position. SFRTA is committed to the completion of PTC by 2018. We would like to thank SFRTA’s Governing Board for its direction and support. We also extend our thanks and appreciation to SFRTA’s management and staff for their continued dedication in achieving the Authority’s Goals and Objectives.
Sincerely,
Jack L. Stephens Executive Director TABLE OF CONTENTS
INTRODUCTORY SECTION Letter of Transmittal ...... 1 Governing Board and Executive Management ...... 7 Mission Statement...... 8 Organizational Structure ...... 9 Certificate of Achievement ...... 10
FINANCIAL SECTION Independent Auditors’ Report ...... 11 Management’s Discussion and Analysis ...... 13 Financial Statements Statement of Net Position ...... 29 Statement of Revenues, Expenses and Changes in Net Position ...... 30 Statement of Cash Flows ...... 31 Notes to Financial Statements ...... 32
REQUIRED SUPPLEMENTARY INFORMATION Schedule of SFRTA Proportionate Share of the Net Pension Liability – Florida Retirement System…54 Schedule of SFRTA Contributions – Florida Retirement System…………………………………….55 Schedule of SFRTA Proportionate Share of the Net Pension Liability – Retiree Health Insurance Subsidy……………………………………………………………………………………………...…56 Schedule of SFRTA Contributions – Retiree Health Insurance Subsidy…………………………...…57
OTHER REQUIRED SUPPLEMENTARY INFORMATION Supplemental Schedule of Operating Expenses for 2017 ...... 59 Supplemental Schedule of Operating Expenses for 2016 ...... 60
STATISTICAL AND GENERAL INFORMATION SECTION (Not Covered by Auditor’s Report)
Net Position and Changes in Net Position ...... 62 Statistical and General Information ...... 63 Fare Structure ...... 64 Ridership and Sales Analysis ...... 65 Population Trends ...... 67 STATISTICAL AND GENERALINFORMATION SECTION Continued (Not Covered by Auditor’s Report)
Principal Employers by County ...... 68 Demographics and Economics Statistics ...... 69 Capital Assets Statistics and Employees by Department ...... 70 Train Schedule ...... 71 Timeline ...... 72 Awards Page ...... 73 System Map ...... 74 INTRODUCTORY SECTION
LETTER OF TRANSMITTAL GOVERNING BOARD AND MANAGEMENT MISSION STATEMENT ORGANIZATIONAL STRUCTURE CERTIFICATE OF ACHIEVEMENT
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Commissioner Steven L. Abrams, Chair and The Governing Board South Florida Regional Transportation Authority Pompano Beach, Florida
State law requires that each local government complete its financial statements for the most recent fiscal year in compliance with generally accepted accounting principles and the uniform chart of accounts prescribed by the Department of Financial Services. In accordance with state law, staff is proud to present the South Florida Regional Transportation Authority (SFRTA) Comprehensive Annual Financial Report (CAFR) for the fiscal year ended June 30, 2017. This report signifies the SFRTA commitment to provide financial information that is accurate, concise, reliable, and of the utmost quality to its Governing Board, the citizens of the tri-county area, and all other interested parties.
The SFRTA developed this report with an emphasis on clarity, presentation, and completeness, in all material respects, and to present fairly the financial position and results of the SFRTA operations. All disclosures necessary to gain a full understanding of the SFRTA financial activities have been included.
Assumption of Responsibility: The SFRTA management produced this report in accordance with guidelines recommended by the Government Finance Officers Association of the United States and Canada (GFOA). The responsibilities for the accuracy, fairness, and completeness of the financial statements, note disclosures, supplementary schedules, and statistical data presented rest with the management of the SFRTA. It is the representation of management that the enclosed data presents fairly, in all material respects, the financial operations of the SFRTA.
Internal Control: The present accounting system includes the necessary internal controls to ensure reasonable, but not absolute assurance, regarding the safekeeping of assets against loss from unauthorized use or disposition. It also ensures that adequate accounting data are combined to allow for the preparation of financial statements in conformity with accounting principles generally accepted in the United States of America. The concept of reasonable assurance recognizes that the cost of controls should not exceed the benefits likely to be derived and that the valuation of costs and benefits requires estimates and judgments by management.
Evaluations of internal control occur on a periodic basis. We believe that the SFRTA current internal accounting controls adequately safeguard assets and provide reasonable assurance of proper recording of financial transactions. As a recipient of federal, state, and county financial assistance, the SFRTA is also responsible for ensuring that an adequate internal control structure is in place to ensure compliance with applicable laws and regulations related to those programs. The SFRTA is required to undergo an annual single audit in conformity with the provisions of the audit requirements of Title 2 U.S. Code of Federal Regulations Part 200, subpart F, Uniform Administrative Requirements, Cost Principles and Audit Requirements for Federal Awards (Uniform Guidance) and the requirements of Florida’s Single Audit Act as outlined in Chapter 10.550, Rules of Auditor General. Information relating to findings, recommendations, and all other aspects concerning this single audit are included in a separate document.
Independent Audit: Mauldin & Jenkins, LLC an independent Certified Public Accounting Firm, has audited the financial statements of the SFRTA. Mauldin & Jenkins, LLC rendered an unmodified opinion on the financial statements in their report located in the Financial Section on page 11.
Management’s Discussion & Analysis (MD&A): The MD&A provides the reader of our financial statements with an overview of our current financial condition. The information contained in the MD&A is presented in greater detail than the information in this Letter of Transmittal. The MD&A can be found on pages 13 – 28 in the CAFR.
SFRTA PROFILE
General Information:
South Florida metropolitan area encompasses the southeastern part of the U.S. State of Florida and covers the counties of Miami-Dade, Broward, and Palm Beach, which are the three most populous counties in Florida. The term "South Florida" is roughly synonymous with the Gold Coast. In 2016, the population of South Florida was estimated at 6.1 million by the US Census Bureau making it the eighth largest metropolitan area in the United States behind New York, Los Angeles, Chicago, Dallas, Philadelphia, Houston and Washington DC. Broward County has a population of just under 1.9 million. Miami-Dade County the most populous county in Florida and Palm Beach County grew to 2.69 and 1.42 million, respectively.
The South Florida area is locally served by the SFRTA, Broward County Transit (BCT), Palm Tran (Palm Beach), and Miami-Dade Transit (MDT). The SFRTA, which operates Tri-Rail, provides commuter rail service within the tri-county area, operating 50 weekday trains, 30 Saturday trains, and 30 Sunday trains along a 72-mile stretch of commuter rail.
The Governing Board consists of ten members: one County Commissioner from each county (three appointments); one citizen appointee from each county commission (three appointments); a Florida Department of Transportation (FDOT) – District Secretary (one appointment); and one governor’s appointee from each of the three counties (three appointments).
2 Component Unit of FDOT: The SFRTA is included as a component unit of FDOT. FDOT includes the SFRTA as a component unit based on the special financing relationship that exists between the SFRTA and FDOT. The SFRTA is designated as an enterprise fund of the FDOT.
Annual Budget: The SFRTA Governing Board approves the SFRTA annual operating budget. The Governing Board must also approve any required revisions that result in an increase to total expenditures. The budget is maintained at a department level and is categorized by function: Operations, Train & Station Maintenance, Personnel Expenses, General & Administrative Expenses, Corporate and Community Outreach, Professional Fees, Legal, Contingency and Expenses transferred from/to Capital. Expenditures Line item budgetary controls are maintained by the utilization of purchase orders limited to the boundaries of the budget and by establishing contractual obligations within the confines of the budget. In addition, financial statements, which detail month-to-date and the year-to-date actual versus budgeted expenditure comparisons, are presented to the Governing Board on a monthly basis for review.
Funding for the SFRTA budget is provided through fees collected at train stations, subsidies provided by FDOT, the Federal Transit Administration (FTA), and the three counties serviced by the SFRTA.
ECONOMIC CONDITION AND OUTLOOK
Local Economy:
Florida set another record in tourism by welcoming 112.8 million visitors in 2016, according to VISIT FLORIDA. Based on the latest economic impact study, Florida visitors spend $108.8 billion and supported 1.4 million Florida jobs.
The South Florida area is also a major player in the international trade arena. With three international airports, as well as, three deep-water seaports, the tri-county area provides easy access to Latin and South America. South Florida’s strength as an international trade player is evident by the fact that it ranks among the top 10 largest metropolitan areas in exports, its leading export being professional services to Latin America.
Florida continues to be among the leading states in terms of job creation as we head into the second half of 2017. Florida businesses created nearly 18,000 private-sector jobs in June 2017 bringing the total number added since December 2010 to 1.397 million, and Florida’s overall employment is among the highest in the state’s history. Florida’s unemployment rate has also steadily declined over the past year, dropping from 4.7 percent in June of 2016 to 4.1 percent in June of 2017. The Sunshine State was also recently ranked 3rd among “States with the Fastest Job Growth,” which highlighted growth in the fields of professional and business services, tourism, and health care as reasons to be optimistic about the future of Florida’s job market.
The South Florida housing market has shown considerable improvement. Prices in all three counties have been on a steady climb since the market began to recover in 2012. The statewide median sales price for single-family existing homes was up 7.7 percent compared to 2016.
3 Long Term Financial Planning:
The South Florida population continues to grow and the role of the SFRTA becomes even more crucial. With no place to build new highways, the need for mass transit becomes critical. The SFRTA is committed to creating a first-class transportation network by continuing to be instrumental in the planning and building of a transportation network that will provide for efficient and reliable movement of commuters throughout the tri-county region.
In June 2003, Governor Jeb Bush signed legislation requiring the three counties in the SFRTA service area to contribute $2.67 million each in funding to the SFRTA. To date the three counties have contributed approximately $112.1 million, and the SFRTA has used approximately $71.1 million in various capital projects.
In December 2009, in a special session, FDOT, per FL Statutes-Title XXVI Public Transportation Section 343.51, awarded the SFRTA a dedicated funding source. The law amended Section 343.58, Florida Statutes, to provide SFRTA with additional dedicated funding for Tri-Rail from the State Transportation Trust Fund (STTF). Effective July 1, 2010 (FY 2011), FDOT was required to annually transfer $13.3 million, and an additional amount of no less than $17.3 million, from the STTF to SFRTA for operating assistance ($30.6 million total annual STTF funding). While the legislation did not establish any new net funding, it filled the gap between what was statutorily required of the counties, and what was necessary to operate the SFRTA service in FY 2011.
Subsequent to SFRTA assuming responsibility for maintaining and dispatching the South Florida Regional Corridor on March 29, 2015 (FY 2015), Section 343.58(4)(a)2., Florida Statutes, changed the STTF annual funding requirement for SFRTA. FDOT must now annually transfer $15 million from the STTF to SFRTA for operations, maintenance, and dispatch and an additional amount of no less than $27.1 million for operating assistance ($42.1 million total annual STTF funding). In addition to the $12.0 million annual increase in dedicated funding for assuming dispatch and maintenance of the South Florida Rail Corridor (SFRC), FDOT has agreed to cover 100 percent of annual maintenance costs up to $14.4 million. Costs in excess of the $14.4 million will be shared with FDOT, based on agreed percentages outlined in the Operating Agreement between FDOT and SFRTA. The Amended Operating Agreement, through fiscal years 15-21, commits FDOT funds of $25.7 million and SFRTA funds of $1.9 million, and for years 22-24, commits FDOT funds of $27.4 million and SFRTA funds of $2.1 million.
CURRENTLY KNOWN FACTS, DECISIONS OR CONDITIONS
Major Initiatives:
Operations Center and Tri-Rail Pompano Beach Green Station Demonstration Project: SFRTA substantially completed construction of the Operations Center and Tri-Rail Pompano Beach Green Station in February 2017. Also, SFRTA staff and functions transitioned to new Operations Center. In addition, Safety and Security functions centralized at the Operations Center, including crew call, signals, dispatch, service recovery, and security dispatch.
4 Positive Train Control (PTC): A Notice to Proceed was issued for design, installation, training and testing through to system acceptance, for PTC on the SFRC to meet federal requirements to be operational by December 31, 2018.
Tri-Rail Coastal Link (TRCL): SFRTA coordinated with FDOT on design and construction activities for the Northwood Crossover project to link the SFRC and Florida East Coast (FEC) rail corridor in Palm Beach County.
Tri-Rail Downtown Miami Link (TRDML): Regional partnerships agreements and approvals were advanced for the TRDML’s Iris rail connection project to bring Tri-Rail into the new MiamiCentral Station in downtown Miami, on the FEC rail corridor.
Public Safety Coordination Center (PSCC): Activities have increased to included first-responder notification and capability to pinpoint and direct responders to exact trouble spot locations. Also, there has been enhanced security response for SFRTA Commuter Buses.
Commuter Services – Tri-Rail Commuter Connector Buses: Commuter Connector Bus real-time tracking was added to the SFRTA Tri-Rail Tracker application and website. Fleet has four heavy-duty 35 foot and 24 medium-duty foot buses, each with 50 passenger capacity, real-time tracking and Wi-Fi capability.
Miami River-Miami Intermodal Center (MR MICCI): Key concurrence from Federal Transit Administration (FTA) and the State Historic Preservation Office (SHPO) were received, clearing a major hurdle in the project environmental clearance process for the MR MICCI project.
Transit Oriented Development (TOD) Planning: SFRTA passed a resolution adopting a TOD Policy in April, 2017. Seven local governments were awarded grant funds through an FTA Pilot Project Grant for TOD planning activities along the FEC corridor.
CERTIFICATE OF ACHIEVEMENT
The GFOA awarded a Certificate of Achievement for Excellence in Financial Reporting to the SFRTA for its CAFR report for the fiscal year ended June 30, 2016. In order to be awarded a Certificate of Achievement, a governmental unit must publish an easily readable and efficiently organized CAFR. 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.
5 ACKNOWLEDGEMENTS
Once again, the SFRTA has successfully prepared an outstanding CAFR. An achievement made possible by the dedicated service of the entire staff. Special thanks go to the staff of the Finance Department for their support and devotion to this project. We can praise them all for their continued efforts to improve performance and reporting excellence. Additionally, we extend our appreciation to Mauldin & Jenkins, LLC. for their guidance and professional assistance in the preparation of this report.
Respectfully submitted,
Jack L. Stephens Richard D. Chess, MBA Executive Director Director of Finance
6 7 MISSION STATEMENT
“To coordinate, develop and implement, in cooperation with all appropriate levels of government, private enterpriseand citizens- at-largein the community, a viable regional transportation system in South Florida that endeavorsto meet the desires andneeds for the movement ofpeople, goods and services.”
8 SFRTA’S ORGANIZATIONAL STRUCTURE
Governing Board General Counsel (10 Members)
Deputy General Counsel
Executive Director
Director of Administration/ EEO Officer
Deputy Executive Director
Director of Engineering & Construction Director of Finance
Director of Human Resources Director of Operations
Director of Planning & Capital Director of Procurement Development
Public Information Officer Comptroller/Director of Information Technology
Director of Safety & Security
9 10 This page is intentionally left blank This page is intentionally left blank FINANCIAL SECTION
INDEPENDENT AUDITOR’S REPORT MANAGEMENT’S DISCUSSION AND ANALYSIS BASIC FINANCIAL STATEMENTS NOTES TO THE FINANCIAL STATEMENTS REQUIRED SUPPLEMENTARY INFORMATION OTHER REQUIRED SUPPLEMENTARY INFORMATION
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SOUTH FLORIDA REGIONAL TRANSPORTATION AUTHORITY MANAGEMENT’S DISCUSSION AND ANALYSIS JUNE 30, 2017
As management of the South Florida Regional Transportation Authority (SFRTA), we wrote this Management’s Discussion and Analysis (MD&A) to provide the reader of our Comprehensive Annual Financial Report (CAFR) with an overview of our current financial condition. This Analysis should be read in conjunction with our Letter of Transmittal, found on pages 1 - 6 of this CAFR, and the financial statements immediately following the MD&A. Our intent was to make this analysis objective, based on currently known facts.
The SFRTA's CAFR consists of four parts: Management’s Discussion and Analysis, the Basic Financial Statements, Notes to the Financial Statements and Required Supplementary Information.
The MD&A is also divided into four sections:
Section I-Overview of the Financial Statements: Section I gives the reader an overview of the SFRTA’s basis of accounting, measurement focus, the types of financial statements the SFRTA issues and financial highlights for fiscal year 2017.
Section II-Financial Analysis of the SFRTA: This section provides the reader with an analysis of changes in the SFRTA’s net position, an analysis of the SFRTA’s operations and financial condition for the fiscal year ended June 30, 2017, condensed financial information derived from the Statement of Net Position, the Statement of Revenue, Expenses and Changes in Net Position. In many cases, we have provided a comparison to fiscal year 2016.
Section III-Changes in Capital Assets and Long-Term Debt: This section discusses the SFRTA’s purchase of capital assets, depreciation expense and the value of any asset disposed of during the year. This section also describes the SFRTA’s policy on long-term debt.
Section IV-Currently Known Facts, Decisions and Conditions: In Section IV, the SFRTA staff discusses known facts, decisions or conditions that could, or will have an impact on the SFRTA’s operations.
There is no discussion on budgets since an analysis on budgets for Enterprise Funds is not one of the items specifically described by Paragraph 11 of Governmental Accounting Standards Board (GASB) Statement No. 34. There is, however, information concerning the SFRTA’s budget in Note 1.F in the Notes to the Financial Statements.
There is also no discussion on infrastructure assets, as the SFRTA does not report these assets on a modified accrual basis because the SFRTA operates as an enterprise fund and records its assets on the full accrual basis.
I. OVERVIEW OF THE FINANCIAL STATEMENTS
The SFRTA’s fiscal year starts July 1, and ends June 30. The SFRTA operates as an enterprise fund and adheres to the accounting standards as set forth by the GASB, including GASB Statements Nos. 33 and 34.
13 SOUTH FLORIDA REGIONAL TRANSPORTATION AUTHORITY MANAGEMENT’S DISCUSSION AND ANALYSIS JUNE 30, 2017
For reporting purposes, the SFRTA considers itself a special-purpose government engaged only in business-type activities. The required financial statements for this type of entity are:
1. Statement of Net Position: This statement is quite similar to the balance sheet used in commercial businesses.
2. Statement of Revenues, Expenses and Changes in Net Position: This statement puts an emphasis on total net position and is quite similar to a profit and loss statement used in commercial businesses.
3. Statement of Cash Flows (Direct Method): This statement shows cash flows, both inward and outward in terms of operating activities, financing activities and investing activities.
The enterprise fund Statements of Net Position, Revenue, Expenses and Changes in Net Position are presented using the economic resources measurement focus and the accrual basis of accounting. The economic resources measurement focus is essentially full commercial accounting with depreciation of capital assets. The accrual basis of accounting recognizes revenue in the period in which they are earned and become measurable and recognizes expenses in the period in which they are incurred. The determination of net loss is measured by the matching of revenues earned with expenses incurred.
The SFRTA records all assets and all liabilities on the Statement of Net Position. The SFRTA records capital assets in the Statement of Net Position at historical cost net of accumulated depreciation. In accordance with the SFRTA’s policies and procedures, the SFRTA capitalizes all assets costing $1,000 or more with a useful life greater than one year, except for land and construction in progress, and depreciates assets over their useful life (Note 1. I of the Notes to the Financial Statements provides additional detail on depreciation).
The SFRTA defines operating revenues and operating expenses as those revenues and expenses that can be attributable to the operations of its trains. Operating revenues consists of fares and other services. Fares are revenue collected from passengers. Other services consist of revenues generated at train stations, such as vending machine revenue. Operating expenses are those expenses, which are necessary for the daily operations of the trains and include train-operating costs, marketing costs, engineering costs, planning costs, legal costs, general and administrative costs and depreciation. Depreciation is a non-funded expense. The SFRTA classifies interest income, subsidies and grants as Non-Operating Revenue.
Financial Highlights x Fiscal year 2017, marks the fourteenth year that Broward, Miami-Dade and Palm Beach Counties have each contributed $2.67 million ($8.01 million in total) to the SFRTA. Since fiscal year 2004, the total received by the SFRTA from Broward, Miami-Dade and Palm Beach Counties is approximately $112.2 million. In fiscal years 2016 and 2015, the SFRTA used approximately $11.9 million and $7.6 million respectively to fund various capital projects, while in fiscal year 2017, the SFRTA used approximately $7.6 million to fund various capital projects. As of June
14 SOUTH FLORIDA REGIONAL TRANSPORTATION AUTHORITY MANAGEMENT’S DISCUSSION AND ANALYSIS JUNE 30, 2017
30, 2017, the remaining funds of approximately $21.1 million will be used to leverage funds for future capital projects. x In fiscal year 2017, the SFRTA’s total net position was approximately $626.1 million reflecting an increase from fiscal year 2016 of approximately $6.0 million or 1.0%. The increase in total net position is primarily due to the $21.3 million increase in net investment in capital assets offset by the $7.6 million decrease in net position restricted for capital projects. Approximately $10.6 million or 1.7% of the net position is unrestricted. In fiscal year 2016, the SFRTA’s total net position was approximately $620.1 million reflecting an increase of approximately $27.0 million or 4.5%. Approximately $18.3 million or 3.0% of the net position is unrestricted. The increase in total net position is primarily due to the $38.6 million increase in net investment in capital assets offset by the $11.9 million decrease in net position restricted for capital projects. x In fiscal year 2017, operating expenses, before depreciation, increased by approximately $9.0 million or 8.9%. In fiscal year 2016, operating expenses, before depreciation, increased by approximately $14.0 million or 15.9%. For fiscal year 2015, operating expenses, before depreciation, increased by approximately $12.6 million or 16.7%. x Operating revenue in fiscal year 2017 increased by approximately, $529,000 or 3.9%. In fiscal year 2016, operating revenue increased by approximately $363,000 or 2.7% while in fiscal 2015 operating revenue increased by approximately $99,000 or 0.8%.
II. FINANCIAL ANALYSIS OF THE SFRTA
Summary of Net Position
Current assets: Total current assets in fiscal year 2017 decreased by approximately $13.2 million or 11.5%, compared to fiscal year 2016. This decrease in current assets was mainly due to the $20.9 million decrease in cash and cash equivalents, offset by the increase of $6.8 million in accounts receivable for state grants. The noticeable decline in cash was directly related to the additional costs incurred as a result of the construction of the new Operations Center.
Current assets in fiscal year 2016 increased by approximately $10.4 million or 10.0%, compared to fiscal year 2015. This increase in current assets was mainly due to the $15.3 million increase in accounts receivable created by the Downtown Miami Station, offset by the total decrease of $10.0 million in cash and cash equivalents. The noticeable decline in cash was directly related to the additional costs incurred as a result of the SFRTA’s takeover of the maintenance of way (MOW).
Noncurrent assets: In fiscal year 2017, noncurrent assets net of accumulated depreciation increased by approximately $21.3 million or 3.7%. The $21.3 million increase in net capital assets in 2017 results primarily from asset acquisitions of $54.1 million less depreciation of $32.8 million. In fiscal year 2016, noncurrent assets net of accumulated depreciation increased by approximately $38.6 million or 7.3%. The $38.6 million increase in net capital assets in 2016 results from asset acquisitions of $75.9 million less depreciation of $32.5 million. 15 SOUTH FLORIDA REGIONAL TRANSPORTATION AUTHORITY MANAGEMENT’S DISCUSSION AND ANALYSIS JUNE 30, 2017
Deferred outflows of resources: Deferred outflows of resources in fiscal year 2017 increased by approximately $1.3 million or 32.4% when compared to fiscal year 2016. Deferred outflows of resources for the Florida Retirement System and Retirement Health Insurance Subsidy Program are approximately $2.1 million and $400,000, respectively. Deferred outflows of resources in fiscal year 2016 increased by approximately $2.2 million or 130.1%. Deferred outflows of resources for the Florida Retirement System and Retirement Health Insurance Subsidy Program of approximately $1.9 million and $300,000, respectively.
Current liabilities: Current liabilities in fiscal year 2017 decreased approximately $4.9 million or 10.8% compared to fiscal year 2016. The decrease in fiscal year 2017 was primarily due to the $8.9 million decrease in accruals related to the Downtown Miami Station, offset by the $3.6 million increase in accounts payable. Unearned revenue increased by approximately $248,000 primarily due to the increases in Stored Value of approximately $261,800 and ticket sales of $17,800, offset by the $32,000 decrease in other deferred revenue.
Current liabilities in fiscal year 2016 increased approximately $27.1 million or 144.7% compared to fiscal year 2015. The noticeable increase in fiscal year 2016 was primarily due to the $16.9 million increase in accruals related to the Downtown Miami Station, along with the $10.0 million increase in accounts payable. Unearned revenue increased by approximately $110,000 primarily due to the increase in Stored Value of approximately $218,400, offset by the decreases in other deferred revenue of approximately $71,300 and in ticket sales of approximately $37,400 for tickets sold in the month of June for July 2016 travel.
Noncurrent liabilities: In fiscal year 2017 non-current liabilities increased by approximately $10.1 million or 47.1%. This increase was primarily due to the $9.1 million note payable to FECI, LLC related to the Downtown Miami Station, coupled with the $3.8 million increase in net pension liability. This increase was offset by the $2.7 million decrease in deposits, which represent the SFRTA’s liability of funds from the City of Fort Lauderdale for the WAVE project.
In fiscal year 2016 non-current liabilities decreased by approximately $2.6 million which was primarily the result of the decrease of approximately $5.0 million in deposits. The noncurrent portion of compensated absences increased by approximately $28,000 or 4.0%. The SFRTA’s liability for deposits is approximately $13.1 million, which is comprised primarily in funds from the City of Fort Lauderdale for the WAVE project.
In fiscal years 2017 and 2016, the SFRTA’s liability for Advances from FDOT represents approximately $2 million received when the SFRTA commenced operations and is to be repaid to the FDOT when and if the SFRTA ceases operations.
16 SOUTH FLORIDA REGIONAL TRANSPORTATION AUTHORITY MANAGEMENT’S DISCUSSION AND ANALYSIS JUNE 30, 2017
Deferred inflows of resources: Deferred inflows of resources in fiscal year 2017 decreased by approximately $1.8 million or 96.5%. The decrease in fiscal year 2017 was primarily due to a decrease of deferred inflows of resources for the Florida Retirement System of approximately $553,000. Deferred inflows of resources in fiscal year 2016 decreased by approximately $202,000 or 9.8%. The decrease in fiscal year 2016 was primarily due to a decrease of deferred inflows of resources for the Florida Retirement System of approximately $200,000.
Net position: The SFRTA’s total net position in fiscal year 2017 is comprised of net investments in capital assets totaling approximately $592 million, restricted net position for capital projects of approximately $23.5 million which included approximately $21.1 million in restricted funds from the counties and approximately $2.4 million from other funding sources; and unrestricted net position of approximately $10.6 million. In fiscal year 2017, the SFRTA used approximately $8.01 million from the counties’ contributions to fund various capital projects mostly related to the construction of the operations center.
The SFRTA’s total net position in fiscal year 2016 are comprised of net investments in capital assets totaling approximately $570.7 million, restricted net position for capital projects of approximately $31.1million which included approximately $28.7 million in restricted funds from the counties and approximately $2.4 million from other funding sources; and unrestricted net position of approximately $18.3 million. In fiscal year 2016, the SFRTA used approximately $8.01 million from the counties’ contributions to fund various capital projects mostly related to the purchase of railcars.
In fiscal year 2017, the SFRTA acquired approximately $98.4 million of capital assets, an increase of approximately $27.3 million or 38.4% over last year’s net addition of $71.1 million. The increase in capital assets additions was primarily the result of the construction in progress related to the SFRTA’s new operations center being built during fiscal year 2017 and the WAVE and Downtown Miami Station projects.
In fiscal year 2016, the SFRTA acquired approximately $71.1 million of capital assets, an increase of approximately $37.0 million or 109.0% over last year’s net addition of $34.1 million. The increase in capital assets additions was primarily the result of the construction in progress related to the SFRTA’s new operations center being built during fiscal year 2016 and the WAVE and Downtown Miami Station projects.
To determine the overall performance of the SFRTA, the relative changes in net position must be considered. By comparing assets and liabilities, the overall position of the SFRTA in fiscal year 2017 resulted in an increase in net position of approximately $6.0 million or 1.0%. In fiscal year 2016, the increase in net position was approximately $27.0 million or 4.5%.
Presented below a summary of assets, liabilities and net position and the comparative summary graph for the past three fiscal years. The more detailed Statement of Net Position can be found in the basic financial statements.
17 SOUTH FLORIDA REGIONAL TRANSPORTATION AUTHORITY MANAGEMENT’S DISCUSSION AND ANALYSIS JUNE 30, 2017
SUMMARY OF STATEMENT OF NET POSITION
2017 2016 2015 ASSETS Total current and other assets$ 101,485,267 $ 114,719,222 $ 104,276,081 Total capital assets (net of depreciation) 591,977,036 570,651,091 532,024,259 Total assets $693,462,303 $ 685,370,313 $ 636,300,340
DEFERRED OUTFLOWS OF RESOURCES $5,118,921 $ 3,866,660 $ 1,680,219
LIABILITIES Total current liabilities$ 40,932,818 $ 45,880,934 $ 18,748,273 Total noncurrent liabilities 31,500,563 21,414,355 24,041,074 Total liabilities$ 72,433,381 $ 67,295,289 $ 42,789,347
DEFERRED INFLOWS OF RESOURCES $64,892 $ 1,854,509 $ 2,056,301
NET POSITION Net Investments in capital assets$ 591,977,036 $ 570,651,091 $ 532,024,259 Restricted for: Capital Projects 23,535,651 31,091,581 42,980,686 Unrestricted 10,570,264 18,344,503 18,129,966 Total net position $ 626,082,951 $ 620,087,175 $ 593,134,911
COMPARATIVE SUMMARY OF STATEMENT OF NET POSITION $800,000,000
$700,000,000
$600,000,000
$500,000,000 2017
$400,000,000 2016
$300,000,000 2015
$200,000,000
$100,000,000
$0 Total assets Deferred outflows Total liabilities Deferred inflows of Total net position of resources resources
18 SOUTH FLORIDA REGIONAL TRANSPORTATION AUTHORITY MANAGEMENT’S DISCUSSION AND ANALYSIS JUNE 30, 2017
SUMMARY OF REVENUE
Operating revenue: In fiscal year 2017, train revenue was approximately $14.1 million, an increase of 3.9% over fiscal year 2016 train revenue. In fiscal year 2016, train revenue was approximately $13.1 million, an increase of 2.6% over fiscal year 2015 train revenue. This increase in train revenue is the result of the slight growth in ridership.
Non-operating revenue: Interest income, subsidies provided by the three counties within the SFRTA’s operating area (Broward, Miami-Dade and Palm Beach Counties) and non-capital grants provided by the State, Federal Government and Other Funding are revenue sources used by the SFRTA to fund its operating budget. Even though the SFRTA uses these revenue sources to fund operations, for reporting purposes, the SFRTA considers these sources as non-operating revenue. Federal and State grants that are restricted for capital purposes are not included in non-operating revenue, but rather are classified as contributions.
Interest income: In fiscal 2017, SFRTA’s earnings on investments were approximately $433,000 primarily due to the interest earned on the Counties’ contributions and other restricted funds of $23.5 million. In addition, temporarily idle cash balances are transferred to the Local Government Surplus Funds Trust Fund (Florida Prime) where interest is earned. Interest income for 2017 increased by approximately $153,000.
In fiscal 2016, SFRTA’s earnings on investments were approximately $280,000 primarily due to the interest earned on the Counties’ contributions and other restricted funds of $31.0 million. In addition, temporarily idle cash balances are transferred to the Local Government Surplus Funds Trust Fund (Florida Prime) where interest is earned. Interest income for 2016 increased by approximately $185,000.
Federal grants: Federal grants (non-capital) consist of Preventive Maintenance grants and Planning grants received from the FTA and Federal Highway Administration (FHWA) grants. For fiscal year 2017, Federal grants increased approximately $410,000 or 1.7%. The increase in in Federal grants in fiscal year 2017 was primarily due to increases in Planning grants. For fiscal year 2016, Federal grants decreased approximately $1.8 million or 6.9%. The decrease in in Federal grants in fiscal year 2016 was primarily due to decreases in Planning grants and Preventive Maintenance grants.
Preventive Maintenance grant (FTA): Although usually an operating expense, Preventive Maintenance which is defined as all maintenance costs, is an allowable capital expenditure under FTA guidelines. Transit agencies that use Preventive Maintenance funds must follow General Accepted Accounting Principles (GAAP) and expense those maintenance costs associated with the current fiscal year. Maintenance expenditures that meet the SFRTA’s criteria for capital expenditures are capitalized. The FTA has no cap on the amount of formula funds a transit agency can use for preventive maintenance. However, Preventive Maintenance funds can only be used to cover the cost of actual preventive maintenance expenditures. 19 SOUTH FLORIDA REGIONAL TRANSPORTATION AUTHORITY MANAGEMENT’S DISCUSSION AND ANALYSIS JUNE 30, 2017
For fiscal year 2017, the SFRTA applied approximately $17.1 million as Preventive Maintenance, a decrease of approximately $400,000 from fiscal year 2016’s Preventive Maintenance of approximately $17.5 million.
For fiscal year 2016, the SFRTA applied approximately $17.5 million as Preventive Maintenance, a decrease of approximately $1.7 million from fiscal year 2015’s Preventive Maintenance of approximately $19.2 million.
Planning grants (FTA): Planning grants are grants received from the FTA. These planning grants cover Planning Department- related activities, planning consultants, transit studies, Regional Transportation Organization activities and in-house administrative costs associated with planning and capital projects; however not all planning expenses are covered by Planning grants. During fiscal year 2017, the SFRTA used approximately $7.5 million of FTA capital contributions to fund operating projects. In fiscal year 2016, the SFRTA used approximately $6.5 million of FTA capital contributions to fund operating projects.
Federal Highway Administration (FHWA): The SFRTA receives FHWA funds as a pass-through from FDOT. The SFRTA has received these funds since its inception in 1989 as part of a traffic mitigation project. For fiscal years 2017 and 2016, the SFRTA received $4.0 million FHWA assistance.
Florida Department of Transportation (FDOT): During fiscal year 2017, State grants (non-capital) decreased by approximately $35,000 while in fiscal year 2016, State grants (non-capital) increased by approximately $12.2 million. In a special legislative session in December 2009, FDOT, per FL Statutes-Title XXVI Public Transportation Section 343.51, awarded the SFRTA a dedicated funding source from the State Transportation Trust Fund for approximately $13.3 million to support its operations and expansion. In addition, FDOT provided to the SFRTA approximately $17.3 million for fiscal year 2015-16 for operating assistance.
SFRTA assumed responsibility for dispatch maintenance of the South Florida Regional Corridor on March 29, 2015 (FY 2015), subsequently FDOT must now annually transfer $15 million from the State Transportation Trust Fund (STTF) to SFRTA for operations, maintenance, and dispatch and an additional amount of no less than $27.1 million for operating assistance ($42.1 million total annual funding). In addition, FDOT per amended agreement with SFRTA has committed to cover 100 percent of annual maintenance cost up to $14.4 million.
Other Funding: Other funding consists of approximately $100,000 received from private firms and approximately $85,000 related to other local funding sources.
County Contributions: Broward, Palm Beach and Miami-Dade counties contributed approximately $1.6 million each towards the SFRTA’s operating budget in fiscal years 2017 and 2016.
20 SOUTH FLORIDA REGIONAL TRANSPORTATION AUTHORITY MANAGEMENT’S DISCUSSION AND ANALYSIS JUNE 30, 2017
The following is a summary of revenues for the past three fiscal years
REVENUE SUMMARY
Percent Percent Percent 2017 of 2016 of 2015 of Total Total Total Total Total Total Revenue Operating Revenue$ 14,091,406 13.6%$ 13,562,478 13.2%$ 13,199,536 14.5%
Interest Income 433,412 0.4% 280,247 0.3% 95,094 0.1% FTA 24,629,099 23.9% 24,218,950 23.7% 26,005,159 28.5% FHWA 4,000,000 3.9% 4,000,000 3.9% 4,000,000 4.4% State grants (FDOT) 55,224,939 53.5% 55,260,036 54.1% 43,066,506 47.2% County Contribution 4,695,000 4.5% 4,695,000 4.6% 4,695,000 5.1% Other 184,795 0.2% 184,795 0.2% 184,795 0.2% Total Revenues$ 103,258,651 100.0%$ 102,201,506 100.0%$ 91,246,090 100.0%
REVENUE SOURCES FISCAL YEAR 2017 County Other Contribution 0.2% 4.5% Operating Revenue 13.6%
Interest Income 0.4%
FTA 23.9%
State grants (FDOT) 53.5% FHWA 3.9%
21 SOUTH FLORIDA REGIONAL TRANSPORTATION AUTHORITY MANAGEMENT’S DISCUSSION AND ANALYSIS JUNE 30, 2017
SUMMARY OF EXPENSES
Operating expenses: Total operating expenses for fiscal year 2017, including depreciation expense, were approximately $143.8 million. This was an increase of approximately $9.3 million or 6.9% when compared to fiscal year 2016. Total operating expenses for fiscal year 2016, including depreciation expense, were approximately $134.5 million. This was an increase of approximately $13.8 million or 11.4% when compared to fiscal year 2015.
Operations: In fiscal year 2017, total operations, which include train-operating costs, feeder service, train security, insurance costs, train fuel costs and train and station maintenance, increased by approximately $7.8 million or 14.0%. The increase in total operations was due to the following increases: $1.9 million or 4.7% in train operations, $527,000 or 10.3% in train fuel, $444,000 or 7.4% in feeder service, $299,000 or 13.7% in insurance and $50,000 or 0.8% in security expense. In fiscal year 2017, train and station maintenance increased by approximately $4.2 million or 19.3 % due to higher maintenance expenses related to the trains and stations.
In fiscal year 2016, total operations, which include train-operating costs, feeder service, train security, insurance costs, train fuel costs and train and station maintenance, decreased by approximately $980,000 or 3.0%. Train operations increased by approximately $564,000 or 4.9% due to a reduction in the train operation costs, while train fuel expense decreased by approximately $2.3 million or 30.7%. This substantial decrease was due to significant reductions in the market price for fuel. Feeder service increased by approximately $443,000 or 8.0%, security expense increased by approximately $336,000 or 5.8% due to an increase in security contract rates while insurance expense decreased by approximately $50,000 or 2.3%. In fiscal year 2016, train and station maintenance decreased by approximately $107,000 or 0.5 % due to lower maintenance expenses related to the trains and stations.
Planning: Planning expenses include all planning related activities, including salaries and office expenses, planning consultants and planning studies. For fiscal year 2017, planning expenses increased by approximately $1.2 million or 19.0%. The increase in planning expenses is primarily due to the $1.3 million increase in professional fees, offset by decreases of $62,000 and $7,000 in professional fees, and general and administrative fees, respectively. For fiscal year 2016, planning expenses increased by approximately $115,000 or 1.8%. The increase in planning expenses is primarily due to the $159,000 increase in labor and fringe benefits offset by decreases of $34,000 and $10,000 in professional fees, and general and administrative fees, respectively.
Engineering: Engineering expenses in fiscal year 2017 decreased by approximately $122,000, primarily due to a decrease in Maintenance of Way (MOW) expenses of approximately $400,000 offset by an increase in personnel costs of approximately $267,000 attributable to a final payout for a retired employee. Engineering expenses in fiscal year 2016 went up substantially, by approximately $12.6 million,
22 SOUTH FLORIDA REGIONAL TRANSPORTATION AUTHORITY MANAGEMENT’S DISCUSSION AND ANALYSIS JUNE 30, 2017 because of the increase in Maintenance of Way (MOW) expenses, resulting from SFRTA’s takeover of the corridor operation.
Legal: In fiscal year 2017, the legal department expenses were approximately $883,000, an increase of approximately $61,000 or 7.5%, related to increases in labor and fringe benefits, and professional fees. In fiscal year 2016, the legal department expenses were approximately $822,000, an increase of approximately $233,000 or 39.6%, related to increases in labor and fringe benefits, and professional fees. In fiscal year 2015, the legal department expenses were approximately $589,000, a reduction of approximately $83,000 or 12.3%, related to decreases in labor and fringe benefits, and professional fees.
General and Administrative: General and Administrative (G&A) expenses in fiscal year 2017 increased approximately $63,000 or 0.5%. General and Administrative (G&A) expenses in fiscal year 2016 increased approximately $1.9 million or 17.8%. General and Administrative (G&A) expenses in fiscal year 2015 increased approximately $883,000 or 9.2%.
Below is a summary of operating expenses for the past three fiscal years:
EXPENSE SUMMARY Percent Percent Percent of of of 2017 Total 2016 Total 2015 Total
Operations $63,642,613 44.2% $55,831,786 41.5% $56,724,124 47.0% Planning 7,709,465 5.4% 6,476,177 4.8% 6,361,108 5.3% Engineering 26,346,771 18.3% 26,468,303 19.7% 13,822,494 11.5% Legal 883,411 0.6% 822,132 0.6% 588,830 0.5% General and Administrative 12,451,712 8.7% 12,388,574 9.2% 10,514,7368.7% Depreciation 32,814,490 22.8% 32,515,966 24.2% 32,686,280 27.1% Total Operating Expenses $143,848,462 100.0% $134,502,938 100.0% $120,697,572 100.0%
COMPARATIVE EXPENSE SUMMARY $60,000,000
$50,000,000
$40,000,000
$30,000,000
$20,000,000 2017 $10,000,000 2016 $0 2015
23 SOUTH FLORIDA REGIONAL TRANSPORTATION AUTHORITY MANAGEMENT’S DISCUSSION AND ANALYSIS JUNE 30, 2017
Summary of Operations: The SFRTA’s fiscal year 2017 operating loss, including depreciation, was $129.8 million. This is an $8.8 million increase over fiscal year 2016’s loss of $120.9 million. The overall increase in operating loss was mainly due to the $7.8 million increase in operations, coupled with the increase of approximately $1.2 million in planning expenses and an approximate $299,000 increase in depreciation expense. These increases were offset by a $121,500 decrease in engineering expenses.
The SFRTA’s net position increased by approximately $6.0 million in fiscal year 2017, a 1.0% increase over $620.1 million in fiscal year 2016. The increase was due to the excess of total capital contributions over the loss before capital contributions.
The SFRTA’s fiscal year 2016 operating loss, including depreciation, was $120.9 million. This is a $13.4 million increase over fiscal year 2015’s loss of $107.5 million. The overall increase in operating loss was mainly due to the $12.6 million increase in engineering, coupled with the increase of approximately $1.9 million in general and administrative expenses. These increases were offset by the $892,000 and $170,000 decreases in operations and depreciation expenses, respectively.
The SFRTA’s net position increased by approximately $27.0 million in fiscal year 2016, a 4.5% increase over $593.1 million in fiscal year 2015. The positive increase was primarily due to the $15.2 million increase in other capital contributions, coupled with increases in FTA and City of Fort Lauderdale capital contributions of $5.1 million and $4.8 million, respectively.
Presented on the next page is a summary of changes in net position for the past three fiscal years
24 SOUTH FLORIDA REGIONAL TRANSPORTATION AUTHORITY MANAGEMENT’S DISCUSSION AND ANALYSIS JUNE 30, 2017
SUMMARY OF STATEMENT OF REVENUES, EXPENSES AND CHANGES IN NET POSITION
2017 2016 2015 OPERATING REVENUE: Total Operating Revenue $14,091,406 $13,562,478 $13,199,536
OPERATING EXPENSES: Operations 63,642,613 55,831,786 56,724,124 Planning 7,709,465 6,476,177 6,361,108 Engineering 26,346,771 26,468,303 13,822,494 Legal 883,411 822,132 588,830 General and Administration 12,451,712 12,388,574 10,514,736 Depreciation 32,814,490 32,515,966 32,686,280 Total Operating Expenses 143,848,462 134,502,938 120,697,572 Operating Loss (129,757,056) (120,940,460) (107,498,036)
NON-OPERATING REVENUES: Interest Income 433,412 280,247 95,094 Federal Transit Administration 24,629,099 24,218,950 26,005,159 Federal Highway Administration 4,000,000 4,000,000 4,000,000 Florida Department of Transportation 55,224,939 55,260,036 43,066,506 Other Local Funding 184,795 184,795 184,795 Broward County 1,565,000 1,565,000 1,565,000 Miami-Dade County 1,565,000 1,565,000 1,565,000 Palm Beach County 1,565,000 1,565,000 1,565,000 Total Non-Operating Revenues 89,167,245 88,639,028 78,046,554 Loss before capital contributions (40,589,811) (32,301,432) (29,451,482)
CAPITAL CONTRIBUTIONS: Total capital contributions 46,585,587 59,253,696 34,516,261 Change in net position 5,995,776 26,952,264 5,064,779 Total net position - beginning 620,087,175 593,134,911 588,070,132 Total net position - ending 626,082,951 620,087,175 593,134,911
25 SOUTH FLORIDA REGIONAL TRANSPORTATION AUTHORITY MANAGEMENT’S DISCUSSION AND ANALYSIS JUNE 30, 2017
III. CHANGES IN CAPITAL ASSETS AND LONG-TERM DEBT
Capital Assets: Capital assets include land, parts and rail equipment, furniture, fixtures and office equipment furniture, double tracking, buildings, bridges, automobiles, other equipment, and construction in progress, and are recorded at historical cost.
Total net capital assets increased $21.3 million or 3.7% in fiscal year 2017. The SFRTA added approximately $54.1 million in Construction in Progress and transferred approximately $44.3 million out of Construction in Progress into the following assets: $44.0 million in Buildings related to the new operations center, $83,500 related to Parts and equipment, $161,700 related to Furniture, Fixtures and Office Equipment and $28,300 related to Automobiles. The SFRTA retired three automobiles, two generators and a workstation totaling approximately $242,000. Depreciation for fiscal year 2016 was approximately $32.8 million. Accumulated depreciation as of June 30, 2017, was approximately $379.5 million. For a detailed discussion of capital assets, see Note 3 in the Notes to the Financial Statements.
Presented below is a summary of the Capital Assets for the year ended June 30, 2017:
Deletions/ Balance Balance 7/1/16 Additions Reclassifications 6/30/2017 Capital assets not being depreciated: Land$ 20,299,703 $ - $ - $ 20,299,703 Construction in progress 121,337,394 54,140,435 (44,304,050) 131,173,779 Total capital assets not depreciated 141,637,097 54,140,435 (44,304,050) 151,473,482 Capital assets, being depreciated: Parts and equipment 165,940,136 83,543 - 166,023,679 Furniture, fixtures and office equipment 3,658,787 161,724 (39,500) 3,781,011 Double tracking 237,821,832 - - 237,821,832 Buildings 125,726,099 44,030,528 (150,463) 169,606,164 Bridges 115,841,300 - - 115,841,300 Automobiles 500,633 28,255 (52,059) 476,829 Other equipment 126,406,682 - - 126,406,682 Total capital assets, being depreciated 775,895,469 44,304,050 (242,022) 819,957,497 Less accumulated depreciation for: Parts and equipment 46,915,409 7,152,713 - 54,068,122 Furniture and fixtures 3,249,814 259,726 (39,500) 3,470,040 Double tracking 92,232,296 7,950,689 - 100,182,985 Buildings 93,724,133 6,710,064 (150,463) 100,283,734 Bridge 24,738,669 2,557,115 - 27,295,784 Automobiles 318,139 64,090 (52,059) 330,170 Other equipment 85,703,015 8,120,093 - 93,823,108 Total accumulated depreciation 346,881,475 32,814,490 (242,022) 379,453,943 Capital assets being depreciated, net 429,013,994 11,489,560 - 440,503,554 Capital assets, net $ 570,651,091 $ 65,629,995 $ (44,304,050) $ 591,977,036
26 SOUTH FLORIDA REGIONAL TRANSPORTATION AUTHORITY MANAGEMENT’S DISCUSSION AND ANALYSIS JUNE 30, 2017
Long-Term Debt: Long-term debt increased from $21.9 million in fiscal year 2016 to $31.5 million in fiscal year 2017. Long-term debt consists of approximately $10.4 million in deposits, $9.3 million in net pension liability, $9.1 million in note payable, $2.0 million in advances from FDOT and $714,000 in compensated absences.
For additional detailed information on long-term liabilities, see Note 7 in the Notes to the Financial Statements.
IV. ECONOMIC FACTORS AND NEXT YEAR’S BUDGET AND RATES
On April 28, 2017, the Governing Board of the South Florida Regional Transportation Authority (SFRTA) approved an operating budget of $111,514,992 and a capital budget of $144,166,750 for fiscal year 2018. This is a balanced budget with revenues fully covering operating and capital expenses for the year. The budget serves as a source of information for the SFRTA Governing Board, management and staff, passengers and other stakeholders. The programs and services funded by this budget help to attain the vision and accomplish the Authority’s mission:
“To coordinate, develop and implement, in cooperation with all appropriate levels of government, private enterprise and citizens-at-large in the community, a viable regional transportation system in South Florida that endeavors to meet the desires and needs for the movement of people, goods and services.”
The operating budget includes $22,121,917 in Federal Transit Administration (FTA) funds for the maintenance of SFRTA’s rail fleet and train stations. In addition, the operating budget includes $55.2 million in annual funding from FDOT for operating assistance, maintenance and dispatch along the South Florida Regional Corridor.
Some noteworthy changes in the capital budget since last year is the inclusion of a $15.6 million grant from the Federal Transit Authority (FTA) to fund the Northern Layover and Light Maintenance Facility. In order to advance this project SFRTA completed a property purchase that was critical for the Tri-Rail Coastal Link expansion. The facility will increase capacity and efficiency for the Tri-Rail system.
In fiscal year 2017 job growth in South Florida was driven by gains in construction, education, healthcare and professional services. Hospitality grew at a moderate 2.5 percent while retail and trade grew at slower rates, all categories powering South Florida’s service economy.
Fiscal year 2017 showed a slight increase in overall ridership of .50%. The Weekend ridership has also increased from 670,117 in 2016 to 682,010 in 2017. We continue to operate 50 trains a day on weekdays. SFRTA fares and rates will remain constant for fiscal year 2018.
27 SOUTH FLORIDA REGIONAL TRANSPORTATION AUTHORITY MANAGEMENT’S DISCUSSION AND ANALYSIS JUNE 30, 2017
Requests for Information
This financial report is designed to provide a general overview of the SFRTA’s finances for all those with an interest in the authority’s finances. Questions concerning any of the information provided in this report or requests for additional financial information should be addressed to Richard D. Chess, Director of Finance, South Florida Regional Transportation Authority, 801 NW 33rd Street, Pompano Beach, Florida 33064.
28 SOUTH FLORIDA REGIONAL TRANSPORTATION AUTHORITY STATEMENT OF NET POSITION JUNE 30, 2017 AND 2016
2017 2016 ASSETS Current assets: Cash and cash equivalents$ 48,444,561 $ 69,369,863 Accounts receivable: State grants 14,212,951 7,364,095 Federal grants 17,825,650 18,365,271 Miami Dade County 983,449 948,180 Other 19,143,397 16,308,759 Prepaid expenses 875,259 2,363,054 Total current assets 101,485,267 114,719,222
Noncurrent assets: Capital assets (net of accumulated depreciation) 591,977,036 570,651,091 Total noncurrent assets 591,977,036 570,651,091 Total assets$ 693,462,303 $ 685,370,313
DEFERRED OUTFLOWS OF RES OURCES Deferred outflows of resources related to pensions$ 5,118,921 $ 3,866,660
LIABILITIES Current liabilities: Accounts payable$ 29,263,355 $ 25,613,847 Accruals 9,141,346 18,043,548 Compensated absences 475,978 493,563 Unearned revenue 1,920,753 1,673,117 Due to other governmental units 131,386 56,859 Total current liabilities 40,932,818 45,880,934
Noncurrent liabilities: Compensated absences 713,968 740,344 Deposits 10,386,124 13,130,557 Advances from FDOT 2,000,000 2,000,000 Net pension liability 9,334,539 5,543,454 Note payable 9,065,932 - Total noncurrent liabilities 31,500,563 21,414,355 Total liabilities $72,433,381 $ 67,295,289
DEFERRED INFLOWS OF RES OURCES Deferred inflows of resources related to pensions$ 64,892 $ 1,854,509
NET POSITION Net Investment in Capital Assets$ 591,977,036 $ 570,651,091 Restricted for: Capital projects 23,535,651 31,091,581 Unrestricted 10,570,264 18,344,503 Total net position$ 626,082,951 $ 620,087,175
The accompanying notes are an integral part of these financial statements.
29 SOUTH FLORIDA REGIONAL TRANSPORTATION AUTHORITY STATEMENT OF REVENUES, EXPENSES AND CHANGES IN NET POSITION JUNE 30, 2017 AND 2016
2017 2016 OPERATING REVENUE Passenger fares$ 12,785,301 $ 13,114,959 Other service 1,306,105 447,519 Total operating revenue 14,091,406 13,562,478
O PERATING EXPENS ES Operations 63,642,613 55,831,786 Planning 7,709,465 6,476,177 Engineering 26,346,771 26,468,303 Legal 883,411 822,132 General and administration 12,451,712 12,388,574 Depreciation 32,814,490 32,515,966 Total operating expenses 143,848,462 134,502,938 Operating loss (129,757,056) (120,940,460)
NON-OPERATING REVENUE Interest income 433,412 280,247 Federal Transit Administration 24,629,099 24,218,950 Federal Highway Administration 4,000,000 4,000,000 Florida Department of Transportation 55,224,939 55,260,036 Other local funding 184,795 184,795 Broward County 1,565,000 1,565,000 Miami-Dade County 1,565,000 1,565,000 Palm Beach County 1,565,000 1,565,000 Total non-operating revenue 89,167,245 88,639,028 Loss before capital contributions (40,589,811) (32,301,432)
CAPITAL CONTRIBUTIONS Capital contributions - Federal Transit Administration 6,944,406 16,381,759 Capital contributions - Florida Department of Transportation 11,960,245 14,716,895 Capital contributions - City of Fort Lauderdale 2,785,608 4,967,364 Capital contributions - Other 24,895,328 23,187,678 Total capital contributions 46,585,587 59,253,696
Change in net position 5,995,776 26,952,264 Total net position - beginning 620,087,175 593,134,911 Total net position - ending $ 626,082,951 $ 620,087,175
The accompanying notes are an integral part of these financial statements.
30 SOUTH FLORIDA REGIONAL TRANSPORTATION AUTHORITY STATEMENT OF CASH FLOWS JUNE 30, 2017 AND 2016
2017 2016 CASH FLOWS FROM OPERATING ACTIVITIES Receipts from customers$ 10,163,030 $ (2,052,551) Payments to suppliers (100,696,639) (93,830,406) Payments to employees (12,609,038) (11,472,807) Other receipts 1,306,105 447,519 Net cash used in operating activities (101,836,542) (106,908,245)
CASH FLOWS FROM NONCAPITAL FINANCING ACTIVITIES: Florida Department of Transportation Subsidy 52,706,612 57,836,969 Federal Transit Administration Subsidy 23,129,387 25,848,938 Counties Subsidy 4,879,795 4,879,795 Net cash provided by noncapital financing activities 80,715,794 88,565,702
CASH FLOWS FROM CAPITAL AND RELATED FINANCING ACTIVITIES: Contributions from FDOT 7,075,917 9,988,285 Contributions from FTA 8,983,739 13,580,592 Contributions from City of Fort Lauderdale 1,998,406 4,967,364 Contributions - Other 22,936,972 18,231,192 Acquisition of Capital Assets (41,233,000) (38,711,545) Net cash provided by (used in) capital and related financing activities (237,966) 8,055,888
CASH FLOWS FROM INVESTING ACTIVITIES Interest Income 433,412 280,247 Net cash provided by investing activities 433,412 280,247 Net decrease in cash and cash equivalents (20,925,302) (10,006,408) Balances - beginning of the year 69,369,863 79,376,271 Balances - end of the year$ 48,444,561 $ 69,369,863
Reconciliation of operating loss to net cash used in operating activities: Operating loss (129,757,056) (120,940,460) Adjustments to reconcile operating loss to net cash used in operating activities: Depreciation expense 32,814,490 32,515,966 Changes in Assets and Liabilities Other receivables (2,869,907) (15,277,193) Prepaid 1,487,795 (1,652,489) Deposits (1,125) (1,152) Accounts payable (12,842,567) (1,947,887) Unearned revenue 247,636 109,683 Accrued expenses (salaries) (56,267) 395,980 Due to other governmental units 9,140,459 (110,693) Net cash used in operating activities$ (101,836,542) $ (106,908,245)
NONCASH ACTIVITIES Contributions of capital assets from FTA$ - $ - Contributions of capital assets from other - -
The accompanying notes are an integral part of these financial statements. 31 SOUTH FLORIDA REGIONAL TRANSPORTATION AUTHORITY NOTES TO THE FINANCIAL STATEMENTS FOR THE YEARS ENDED JUNE 30, 2017 AND 2016
Note 1 – Summary of Significant Accounting Policies
In January 1989, Tri-Rail was established to provide interim commuter rail service along a 67-mile corridor between the West Palm Beach Station in Palm Beach County and the Hialeah Market Station in Miami Dade County. In 1988, the Florida Department of Transportation (FDOT) purchased the South Florida Rail Corridor (SFRC) from CSX Transportation (CSXT), Inc. and between 1997 and 1998, Tri-Rail service was extended to the Mangonia Park Station in Palm Beach County and to the Miami Airport Station in Miami-Dade County.
In 2003, the SFRTA, a tri-county public transit authority, was created by the Florida Legislature transforming Tri-Rail into the SFRTA. The purpose for creating the SFRTA was to expand cooperation between Tri-Rail commuter rail services and county transit operators and planning agencies within Miami-Dade, Broward and Palm Beach counties. This vision was to coordinate, develop and implement a viable transportation system in South Florida that improves the quality of life and promotes sustainable growth for future generations.
The SFRTA service area is defined by statute as Miami-Dade, Broward, and Palm Beach counties. However, this area may be expanded to include Monroe County by mutual consent of the SFRTA and the Board of County Commissioners representing the proposed expansion area. Expanding the SFRTA service area outside of these four counties requires Florida Department of Transportation (FDOT) approval.
The Governing Board consists of ten members: One County Commissioner from each county (three appointments); one citizen appointee from each county commission (three appointments); an FDOT – District Secretary (one appointment); and one citizen appointee from each county appointed by the Governor (three appointments). The Governing Board selects an Executive Director to oversee the daily operations of the SFRTA. The SFRTA is included as a component unit of FDOT and based on the special financing relationship. The SFRTA is designated as an enterprise fund of FDOT. The SFRTA is included as a component unit of Florida Department of Transportation (FDOT). FDOT includes the SFRTA as a component unit based on the special financing relationship that exists between the SFRTA and FDOT.
In June 2004, the Governor signed legislation guaranteeing that, on an annual basis, the three counties would each provide, at a minimum, approximately $1.6 million in operating funds and approximately $2.67 million for future capital projects to the SFRTA.
Subsequent to SFRTA assuming responsibility for maintaining and dispatching the South Florida Regional Corridor (SFRC) on March 29, 2015, Section 343.58(4)(a)2, Florida Statutes, changes the State Transportation Trust Fund (STTF) annual funding requirement for Tri-Rail. FDOT must now annually transfer $15 million from the STTF to SFRTA for operations, maintenance, and dispatch and an additional amount of no less than $27.1 million for operating assistance ($42.1 million total annual funding).
Funding is also provided for the annual maintenance of the SFRC based on agreed amounts outlined in an Amended Operating Agreement between FDOT and SFRTA. Per the agreement, FDOT has committed funds of $25.7 million through fiscal years 2015 – 2021 (years 1-7) and SFRTA has 32 SOUTH FLORIDA REGIONAL TRANSPORTATION AUTHORITY NOTES TO THE FINANCIAL STATEMENTS FOR THE YEARS ENDED JUNE 30, 2017 AND 2016
Note 1 – Summary of Significant Accounting Policies committed to providing funds of $1.9 million. For fiscal years 2022 – 2024 (years 8-10), FDOT has committed funds of $27.4 million and SFRTA has committed funds of $2.1 million.
The South Florida urbanized area encompasses the southeastern part of the State of Florida and covers the counties of Miami-Dade, Broward and Palm Beach, which are the three most populous counties in Florida. The term "South Florida" is roughly synonymous with the Gold Coast. In 2010, the population of South Florida was estimated at 5,564,635 by the US Census Bureau making it the eighth largest urbanized area in the United States behind New York, Los Angeles, Chicago, Dallas, Philadelphia, Houston and Washington DC. The South Florida area is locally served by the SFRTA, Broward County Transit (BCT), Palm Tran (Palm Beach County) and Miami-Dade Transit (MDT).
The SFRTA, which operates Tri-Rail, provides commuter rail service within the tri-county area, operating 50 weekday trains, 30 Saturday trains and 30 Sunday trains along a 72-mile stretch of commuter rail. The SFRTA operates Tri-Rail commuter rail service in Miami-Dade, Broward and Palm Beach counties. The rail line goes as far south as Miami International Airport and as far north as Mangonia Park in Palm Beach County. There are currently 18 Tri-Rail stations open for service; 6 in Palm Beach County (Mangonia Park, West Palm Beach, Lake Worth, Boynton Beach, Delray Beach and Boca Raton), 7 in Broward County (Deerfield Beach, Pompano Beach, Cypress Creek, Fort Lauderdale, FLL Airport at Dania Beach, Sheridan Street and Hollywood) and 5 in Miami-Dade County (Golden Glades, Opa-locka, Metrorail Transfer, Hialeah Market and Miami Intermodal Center). SFRTA also operates a free shuttle bus program to and from select Tri-Rail stations, providing connecting service for Tri-Rail riders to numerous destinations in South Florida.
A. Operating revenue, operating subsidies, and expenses defined:
The SFRTA defines operating revenue and operating expenses as those revenue and expenses that can be directly attributable to the daily operations of its trains. Operating revenue consists of fares and other services. Fares are revenue collected from passengers, resulting from ticket sales. Other services consist of revenue generated at train stations, such as vending machine revenue.
Operating expenses are those expenses, which are necessary for the daily operations of the trains and include train-operating costs, engineering costs, planning costs, legal costs, general and administrative costs and depreciation. Depreciation is a non-funded expense. Per GASB 34, the SFRTA classifies operating subsidies as non-operating revenue.
B. Reporting Entity:
The SFRTA is a legally separate component unit of FDOT based upon criteria set forth by Governmental Accounting Standards Board (GASB) Statement 14, “The Financial Reporting Entity” and Statement 61 “The Financial Reporting Entity: Omnibus an Amendment of GASB Statements No. 14 and 34”. For organizations that were previously required to be included as component units by meeting the fiscal dependency criterion, a financial benefit or burden relationship also would have to be present between the primary government and that organization for it to be included in the reporting entity as a component unit. 33 SOUTH FLORIDA REGIONAL TRANSPORTATION AUTHORITY NOTES TO THE FINANCIAL STATEMENTS FOR THE YEARS ENDED JUNE 30, 2017 AND 2016
Note 1 – Summary of Significant Accounting Policies
FDOT includes the SFRTA as a component unit based on the special financing relationship and financial burden relationship that exist between the SFRTA and FDOT.
C. Use of Estimates:
The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenue and expenses during the reporting period. Actual results could differ from those estimates, and the differences could be material.
D. Measurement Focus:
All enterprise fund statements of Net Position, and Revenue, Expenses and Changes in Net Position are presented using the economic resources measurement focus and the accrual basis of accounting. All assets and all liabilities are recorded on the balance sheet. The determination of net loss is measured by the matching of revenue earned with expenses incurred.
E. Basis of Accounting:
The SFRTA operates as an enterprise fund and adheres to the accounting standards as set forth by the Governmental Accounting Standards Board (GASB), including GASB Statements Nos. 33 and 34. The accompanying financial statements have been prepared using the accrual basis of accounting. Accordingly, revenue is recognized in the period in which it is earned and becomes measurable, and expenses are recognized in the period in which they are incurred.
The United States Government and the State of Florida make capital grant funds available to the SFRTA to fund the purchase of certain assets or the construction of various projects. Pursuant to GASB Statement No. 33, Accounting and Financial Reporting for Non-exchange Transactions, capital contributions, including governmental grants, are required to be reported in the Statement of Revenue, Expenses and Changes in Net Position as a separate line item after non-operating revenue and expenses, rather than as direct additions to contributed capital, as under previous standards.
F. Budgets:
The SFRTA's Governing Board adopts the SFRTA's budget on an annual basis. The Governing Board must approve any required revisions that result in an increase to total expenses.
Budget amendments are recommended by the Executive Director and are presented to the Governing Board for approval. During the year, budget amendments have resulted in the utilization of contingency appropriations and transfers between budget line items.
Budgetary control is established by function: Operations, Train & Station Maintenance, Personnel Expenses, General & Administrative Expenses, Corporate and Community Outreach, Professional Fees,
34 SOUTH FLORIDA REGIONAL TRANSPORTATION AUTHORITY NOTES TO THE FINANCIAL STATEMENTS FOR THE YEARS ENDED JUNE 30, 2017 AND 2016
Legal, Contingency and Expenses transferred from/to Capital. Expenses cannot legally exceed the appropriated amount.
FY 2016-17 FY 2016-17 FY 2016-17 FY 2016-17 FY 2016-17 FY 2016-17 ORIGINAL BUDGET AMENDED ACTUAL VARIANCE PERCENT BUDGET AMENDMENTS BUDGET REVENUE OVER (UNDER)VARIANCE REVENUE Operating Revenue$- 13,315,219 $$ 13,315,219 $ 14,524,818 $ 1,209,599 9% Federal Transit Administration 23,046,659 - 23,046,659 18,253,630 (4,793,029) -21% Federal Highway Administration 4,000,000 - 4,000,000 4,000,000 - 0% Fl. Dept. of Transportation 56,322,054 - 56,322,054 55,224,939 (1,097,115) -2% Counties' Contribution 4,695,000 - 4,695,000 4,695,000 - 0% Other Revenue 4,588,926 1,890,156 6,479,082 184,795 (6,294,287) -97% Revenue 105,967,858 1,890,156 107,858,014 96,883,182 (10,974,832) -10% Federal Transit Administration Capital Contributions transferred to Operating * 6,375,469 - 6,375,469 6,375,469 - 0% Total Revenue$ 112,343,327 $ 1,890,156 $ 114,233,483 $ 103,258,651 $-10% (10,974,832)
FY 2016-17 FY 2016-17 FY 2016-17 FY 2016-17 FY 2016-17 FY 2016-17 ORIGINAL BUDGET AMENDED ACTUAL VARIANCE PERCENT BUDGET AMENDMENTS BUDGET EXPENSES OVER (UNDER)VARIANCE EXP ENS ES Operations$ 67,892,172 $ 116,000 $ 68,008,172 $ 60,258,206 $-11% (7,749,966) Train & Station Maintenance 22,876,549 1,674,156 24,550,705 25,802,149 1,251,444 5% Personnel Expenses 11,936,919 - 11,936,919 12,047,933 111,014 1% General & Administrative 2,471,546 (90,000) 2,381,546 4,609,958 2,228,412 94% Corporate & Community Outreach 604,340 - 604,340 560,368 (43,972) -7% Professional Fees 791,100 90,000 881,100 789,296 (91,804) -10% Legal 845,232 100,000 945,232 883,411 (61,821) -7% Contingency - - --0% Expenses Transferred to Capital ** (1,450,000) - (1,450,000) (292,818) 1,157,182 -80% Expense 105,967,858 1,890,156 107,858,014 104,658,503 (3,199,511) -3% Expenses Transferred from Capital *** 6,375,469 - 6,375,469 6,375,469 - 0% Total Expenses$ 112,343,327 $ 1,890,156 $114,233,483 $111,033,972 ($3,199,511) -3%
* Federal Transit Administration capital contributions transferred to operating represent budgeted capital contributions used to fund planning operating expenses. ** Expenses transferred to capital represent the direct allocation of personnel expenses to capital projects *** Expenses transferred from capital represent budgeted planning capital expenses transferred to operating expenses.
G. Cash and Cash Equivalents:
Cash and cash equivalents consist of demand deposits with banks and investments with the State Board of Administration with original maturities at the time of purchase of three months or less.
35 SOUTH FLORIDA REGIONAL TRANSPORTATION AUTHORITY NOTES TO THE FINANCIAL STATEMENTS FOR THE YEARS ENDED JUNE 30, 2017 AND 2016
Note 1 – Summary of Significant Accounting Policies (Continued)
H. Receivables:
Accounts receivable includes all receivables due to the SFRTA from individuals, organizations, or intergovernmental grants. Intergovernmental grant receivables are adjusted to reflect actual operating assistance receivable at June 30, 2017. Pursuant to the accrual basis of accounting, any unbilled receivables are accrued at year-end.
I. Capitalizing Assets:
Capital assets, recorded at historical cost, include land, rail track, equipment, buildings, furniture, fixtures and equipment, repairable parts, automobiles and construction in progress. Donated capital assets are recorded at acquisition value at the date of donation. The criteria for capitalizing an asset are that the asset has a useful life greater than one year and an acquisition cost equal to, or greater than, $1,000.
Expenses for maintenance and repairs, which add to the value or life of an asset, are capitalized. Other maintenance and repair expenses that do not extend the life of the asset are expensed as incurred.
Depreciation and amortization are determined based on the estimated useful lives of the assets using the straight-line method. All depreciation and amortization calculated on assets purchased with grant funds are transferred to reduce contributions.
Presented below are the estimated useful lives of recorded capital assets:
ESTIMATED USEFUL LIFE Equipment: Rail Track 30 years Rolling Stock 25 years * Ticket Vending Machines 15 years Buildings: Stations 15 years Hialeah Yard 5 years Leasehold Improvements 15 years Furniture, Fixtures and Office Equipment 5 years Bridges 45 years Repairable Parts 5 years Automobiles 5 years Other Capital Assets 5 years Computer /Equipment/Software 3 years
*Prior to fiscal year ended June 30, 2008, estimated useful life for Rolling Stock was 10 years
36 SOUTH FLORIDA REGIONAL TRANSPORTATION AUTHORITY NOTES TO THE FINANCIAL STATEMENTS FOR THE YEARS ENDED JUNE 30, 2017 AND 2016
Note 1 – Summary of Significant Accounting Policies (Continued)
J. Construction in Progress:
Construction in progress represents the continued investment in capital improvement projects, which are in various stages of completion. Major improvements or projects currently in progress, of approximately $131.2 million, include Rolling Stock of approximately $16.8 million, Station Improvements projects of approximately $30.3 million, $39.4 million for the All Aboard Downtown Miami Station and other projects of approximately $44.6 million.
K. Compensated Absences:
The SFRTA grants vacation time to employees based on length of service. Accrued vacation time is a vested right of employees and is paid when used or upon termination of employment. In fiscal year 2017, the SFRTA accrued liability was $582,239 in vacation time based on salary rates. In fiscal year 2016, SFRTA accrued liability was $609,362, a 4% decrease.
Employees are compensated for sick leave at the rate of 12 days per year. Compensation for sick leave is expensed as incurred. In fiscal year 2009, the SFRTA revised its sick leave policy, which is, under certain circumstances, a vested right upon termination. After 5 years of service, an employee who has accumulated 80 hours or 10 days of sick time will be eligible, upon leaving employment, to receive 50% of their accumulated sick hours over and above the first 80 hours. This percent will increase each year by 2% until it reaches 100%. The maximum amount of payout will be 960 hours or 120 days; however, employees can accumulate up to 2080 hours or 260 days of sick time. The SFRTA’s accrued liability in fiscal year 2017 was $607,707, and for fiscal year 2016, $624,545, a 3% decrease.
The statement of net position for June 30, 2017 includes a liability for accumulated vacation and sick pay of approximately $1.2 million. Of this amount, an estimated $475,978 is payable within a year and the remaining balance of $713,968 is long term.
L. Unearned Revenue:
The SFRTA reports unearned revenue on its balance sheet. Unearned revenue arise when resources are received by the SFRTA before it has a legal claim to them, or when revenue is received prior to meeting the revenue recognition criteria, as when monthly train tickets are sold in the month prior to them being used. In subsequent periods, when both revenue recognition criteria are met, or when the SFRTA has a legal claim to the resources, the liability for unearned revenue is removed from the balance sheet and revenue is recognized.
37 SOUTH FLORIDA REGIONAL TRANSPORTATION AUTHORITY NOTES TO THE FINANCIAL STATEMENTS FOR THE YEARS ENDED JUNE 30, 2017 AND 2016
Note 1 – Summary of Significant Accounting Policies (Continued)
M. Pension:
Employers participating in the FRS Pension Plan and HIS Program are required to report pension information in their financial statements for fiscal periods beginning on or after June 15, 2014, in accordance with GASB 68. The Schedules of Employer Allocations and Schedules of SFRTA Proportionate Share of the Net Pension Liability and notes to the schedules, along with the system CAFR, provide employers with the required information for reporting. The underlying financial information used to prepare the pension allocation schedules is based on the system records. The financial statements for the defined benefit plans are prepared using the flow of economic resources measurement focus and the accrual basis of accounting and are prepared in accordance with accounting principles generally accepted in the United States.
N. New Accounting Pronouncements:
During fiscal year 2016, the SFRTA implemented GASB No. 73 “Accounting and Financial Reporting for Pension and Related Assets That Are Not within the Scope of GASB Statement 68, and Amendments to Certain Provisions of GASB Statements 67 and 68.” The objective of this statement is to improve the usefulness of information about pensions included in the general purpose external financial reports of state and local governments for making decision and assessing accountability. The Statement establishes requirements for defined benefit pensions that are not within the scope of Statement 68, as well as for the assets accumulated for purposes of providing those pensions. In addition, it establishes requirements for defined contribution pension that are not within the scope of Statement 68. This Statement is effective for fiscal years beginning after June 15, 2015. This Statement did not have an impact on SFRTA’s financial statements, including required disclosures.
During fiscal year 2017, the SFRTA implemented GASB Statement No. 74, “Financial Reporting for Postemployment Benefit Plans Other Than Pension Plans.” This Statement requires that notes to financial statements of all defined benefit OPEB plans that are administered through trusts that meet the specified criteria include descriptive information, such as the types of OPEB provided, the classes of plan members covered, and the composition of the OPEB plan’s board. Such OPEB plans also are required to disclose information about OPEB plan investments, including the OPEB plan’s investment policies, concentrations of investments with individual organizations equaling or exceeding five percent of the OPEB plan’s fiduciary net position, and the annual money-weighted rate of return on OPEB plan investments. Other required note disclosures include information about contributions, reserves, and allocated insurance contracts. This Statement did not have an impact on SFRTA’s financial statements, including required disclosures.
During fiscal year 2017, the SFRTA implemented GASB Statement No. 75, “Accounting and Financial Reporting for Postemployment Benefits Other Than Pensions.” This Statement requires that notes to financial statements of single and agent employers include descriptive information, such as the types of benefits provided and the number and classes of employees covered by the benefit terms. Single and agent employers also are required to disclose information. This Statement did not have an impact on SFRTA’s financial statements, including required disclosures. 38 SOUTH FLORIDA REGIONAL TRANSPORTATION AUTHORITY NOTES TO THE FINANCIAL STATEMENTS FOR THE YEARS ENDED JUNE 30, 2017 AND 2016
Note 1 – Summary of Significant Accounting Policies (Continued)
During fiscal year 2016, the SFRTA implemented GASB Statement No. 76, “The Hierarchy of Generally Accepted Accounting Principles for State and Local Governments.” This Statement reduces the GAAP hierarchy to two categories of authoritative GAAP and addresses the use of transaction or other event is not specified within a source of authoritative GAAP. This Statement is effective for fiscal years beginning after June 15, 2015. This Statement did not have an impact on the SFRTA’s financial statements, including required disclosures.
During fiscal year 2017 the SFRTA implemented GASB Statement No. 77, “Tax Abatement Disclosures.” This Statement establishes financial reporting standards for tax abatement agreements entered into by state and local governments. The disclosures required by this Statement encompass tax abatements resulting both (a) agreements that are entered into by the reporting government and (b) agreements that are entered into by other governments and that reduce the reporting government’s tax revenues. The requirements of this Statement took effect for financial statements starting with the fiscal year that ends December 31, 2016. This Statement did not have an impact of the SFRTA’s financial statements, including required disclosures.
Note 2 – Cash and Cash Equivalents
A. Deposits:
All cash deposits are held in qualified public depositories pursuant to State of Florida Statutes Chapter 280, “Florida Security for Public Deposits Act.” Under the Act, all qualified public depositories are required to pledge eligible collateral having a market value equal to, or greater than, the average daily or monthly balance of all public deposits times the depositories’ collateral pledge level. The pledging level may range from 50% to 125% depending upon the depositories’ financial condition and establishment period. All collateral must be deposited with an approved financial institution.
Any losses to public depositors are covered by applicable deposit insurance, sale of securities pledged as collateral and, if necessary, assessments against other qualified public depositories of the same type as the depository in default. For this reason, all deposits are considered insured.
B. Investments:
Chapter 218.415 of the Florida Statutes governs the SFRTA’s investment practices, “Special Districts Investments.” The SFRTA is authorized to invest in:
(1) The Local Government Surplus Funds Trust Fund (2) Negotiable direct obligations of, or obligations by which the principal and interest are unconditionally guaranteed by the United States government at the prevailing market price for such securities (3) Interest-bearing time deposits (4) Saving accounts in banks organized under the laws of this state and/or federal law
39 SOUTH FLORIDA REGIONAL TRANSPORTATION AUTHORITY NOTES TO THE FINANCIAL STATEMENTS FOR THE YEARS ENDED JUNE 30, 2017 AND 2016
Note 2 – Cash and Cash Equivalents Continued
During fiscal year ended June 30, 2017 the SFRTA held all investments in the Local Government Surplus Funds Trust Fund. The Local Government Surplus Funds Trust Fund is composed of local government surplus funds deposited by local governments and administered by the State Board of Administration (SBA). The SFRTA invested the Counties’ Contributions as well as most of its excess operating monies in the Florida SBA Investment Pool. On December 6, 2007, the SBA restructured its Pool into Pool A and B, which have different asset types and different withdrawal restrictions applicable to them. At the time of the restructuring, all current pool participants had their existing balances proportionately allocated into Florida Prime and Fund B Surplus Funds Trust Fund. As of June 30, 2017, the SFRTA had approximately $36.3 million in Florida Prime. There were no monies in the Fund B Surplus Funds Trust Fund as of June 30, 2017. Additional information can be obtained from the State Board of Administration.
Under Florida Statutes 215.47, investment in the pool is not evidenced by securities; therefore, the investment is not categorized by level of credit risk and the fair value of our external investment is the same as the value of the pool shares. In addition, the Florida Prime is rated by Standard and Poor’s. The current rating is AAAm. The Florida Prime weighted average days to maturity (WAM) at June 30, 2017, were 40 days.
GASB Statement No. 40, Deposit and Investment Risk Disclosures requires that state and local governments communicate key information about common deposit and investment risks related to credit risk, concentration of credit risk, interest rate risk and foreign currency risk. It requires certain disclosures of investments that have fair values that are highly sensitive to changes in interest rates. The SFRTA does not believe GASB No. 40 has a material impact on its financial statement because all its investments are held by the Local Government Surplus Funds Trust Fund.
Note 3 – Capital Assets
Depreciation for fiscal year 2017 was approximately $32.8 million. Depreciation for fiscal year 2016 was approximately $32.5 million. Accumulated depreciation as of June 30, 2017 was approximately $379.5 million.
40 SOUTH FLORIDA REGIONAL TRANSPORTATION AUTHORITY NOTES TO THE FINANCIAL STATEMENTS FOR THE YEARS ENDED JUNE 30, 2017 AND 2016
Note 3 – Capital Assets (Continued)
Deletions/ Balance Balance 7/1/16 Additions Reclassifications 6/30/2017 Capital assets not being depreciated: Land$ 20,299,703 $ - $ - $ 20,299,703 Construction in progress 121,337,394 54,140,435 (44,304,050) 131,173,779 Total capital assets not depreciated 141,637,097 54,140,435 (44,304,050) 151,473,482 Capital assets, being depreciated: Parts and equipment 165,940,136 83,543 - 166,023,679 Furniture, fixtures and office equipment 3,658,787 161,724 (39,500) 3,781,011 Double tracking 237,821,832 - - 237,821,832 Buildings 125,726,099 44,030,528 (150,463) 169,606,164 Bridges 115,841,300 - - 115,841,300 Automobiles 500,633 28,255 (52,059) 476,829 Other equipment 126,406,682 - - 126,406,682 Total capital assets, being depreciated 775,895,469 44,304,050 (242,022) 819,957,497 Less accumulated depreciation for: Parts and equipment 46,915,409 7,152,713 - 54,068,122 Furniture and fixtures 3,249,814 259,726 (39,500) 3,470,040 Double tracking 92,232,296 7,950,689 - 100,182,985 Buildings 93,724,133 6,710,064 (150,463) 100,283,734 Bridge 24,738,669 2,557,115 - 27,295,784 Automobiles 318,139 64,090 (52,059) 330,170 Other equipment 85,703,015 8,120,093 - 93,823,108 Total accumulated depreciation 346,881,475 32,814,490 (242,022) 379,453,943 Capital assets being depreciated, net 429,013,994 11,489,560 - 440,503,554 Capital assets, net $ 570,651,091 $ 65,629,995 $ (44,304,050) $ 591,977,036
Note 4 –Unearned Revenue
Unearned revenue for fiscal year 2017 consists of $49,875 in ticket sales collected in June 2017 for train service to be provided in July 2017; and approximately $1.9 million related to stored value, which will be recognized as revenue when used.
Note 5 – Deposits
The SFRTA’s liability for deposits consists of $10.4 million from the City of Fort Lauderdale for “The Wave” Project.
Note 6 – Advances from FDOT
Advances from FDOT represent approximately $2 million received when the SFRTA commenced operations and is to be repaid to FDOT when and if the SFRTA ceases operations.
41 SOUTH FLORIDA REGIONAL TRANSPORTATION AUTHORITY NOTES TO THE FINANCIAL STATEMENTS FOR THE YEARS ENDED JUNE 30, 2017 AND 2016
Note 7 –Long Term Debt
Changes in Long-Term Liabilities:
Long-term liabilities balances and activity for the year ended June 30, 2017 were as follows:
Beginning Ending Amounts Balance Balance Due within 07/1/2016 Additions Reductions 06/30/2017 One Year Bonds and notes payable:
FECI EC Holding Company, LLC$ - $ 16,254,932 $ (7,189,000) $- 9,065,932 $ Bank United Note, Series 2016 - 1,120,000 (1,120,000) - - Total bonds and notes payable$ - $ 17,374,932 $ (8,309,000) $- 9,065,932 $ Other Liabilities:
Compensated absences$ 1,233,907 $ 614,851 $ (658,812) $ 1,189,946 $ 475,978 Net Pension liability 5,543,454 4,904,309 (1,113,224) 9,334,539- Deposits 13,130,557 41,175 (2,785,608) 10,386,124 - Advances from FDOT 2,000,000 - - 2,000,000 - Total other liabilities $21,907,918 $ 5,560,335 $ (4,557,644) $ 22,910,609 $ 475,978
Business-type activities long-term liabilities $21,907,918 $ 22,935,267 $ (12,866,644) $ 31,976,541 $ 475,978
State Infrastructure Bank Loan
On July 29, 2015, a State Infrastructure Bank Loan Agreement in the amount of $19.3 million was entered into between the State of Florida, Department of Transportation (FDOT), and the South Florida Regional Transportation Authority (“Borrower”). The loan was obtained for the New SFRTA Operations Center. The loan is for five (5) years and bears an interest rate of 1.55% per annum, compounded annually. As of June 30, 2017 there were no drawn downs on the loan. Subsequently, a $14.0 million draw was made in July 2017. The first payment is due in October 2018.
FECI EC Holding Company Loan
On August 8, 2016, a Loan and Security Agreement in the amount of $48,630,000 was entered into between FECI EC Holding Company, LLC (“AAF Lender”), and the South Florida Regional Transportation Authority (“Borrower”). In order to fund the total cost of Tri-Rail Station Improvements, on an interim basis prior to receipt by SFRTA of the necessary funds from the Local Agencies, SFRTA has requested AAF Lender to make available to SFRTA a line of credit. Interest on the line of credit is payable one year after the completion of the project at an annual rate of 9.65%. As of June 30, 2017, the $9.1 million balance represents the total amount funded by SFRTA on behalf of the Local Agency.
42 SOUTH FLORIDA REGIONAL TRANSPORTATION AUTHORITY NOTES TO THE FINANCIAL STATEMENTS FOR THE YEARS ENDED JUNE 30, 2017 AND 2016
Note 7 –Long Term Debt (Continued)
Fiscal year ending June 30, Principal Interest Total 2018$- - $ - 2019 9,065,932 874,862 9,940,794 $9,065,932 $ 874,862 $ 9,940,794
Bank United Note, Series 2016
On December 9, 2016, a Note and Security Agreement in the amount of $22,000,000 was entered into between BankUnited, N.A., and the South Florida Regional Transportation Authority (“Borrower”). In order to fund the Tri-Rail Downtown Miami Link Service the loan was obtained to fund trackage improvements of 8.5 miles of corridor, access/easement fees and positive train control (PTC) equipment on its rolling track. The note is for five (5) years and bears an interest rate of 2.25% per annum, compounded annually and becomes payable in January 2018. There was no outstanding balance on this note at June 30, 2017.
Note 8 – Retirement Plan
General Information about the Pension Plan The SFRTA employees are provided with pensions through the Florida Retirement System (FRS) Pension Plan a cost-sharing, multiple-employer qualified defined benefit pension plan. In addition, the SFRTA employees participate in the Retiree Health Insurance Subsidy (HIS) Program a cost- sharing, multiple-employer defined benefit pension plan. The Florida Department of Management Services, Division of Retirement (division), is part of the primary government of the state of Florida and is responsible for administering the Florida Retirement System Pension Plan and Other State- Administered Systems (system). For the fiscal year ended June 30, 2015, the division administered two defined benefit plans, two defined contribution plans, a supplemental funding of defined benefit plans for municipal police officers and firefighters, and various general revenue funded pension programs. Beginning with the fiscal year ended June 30, 2015, the division issued a publicly available, audited comprehensive annual financial report (CAFR) on behalf of the system that includes financial statements, notes and required supplementary information for each of the pension plans. Detailed information about the plans is provided in the CAFR, which is available online, or by contacting the division.
Plan Description
The Florida Retirement System (FRS) Pension Plan is a cost-sharing, multiple-employer qualified defined benefit pension plan with a Deferred Retirement Option Program (DROP) available for eligible employees. The FRS was established and is administered in accordance with Chapter 121, Florida Statutes. Retirees receive a lifetime pension benefit with joint and survivor payment options. FRS membership is compulsory for employees filling regularly established positions in a state agency, county agency, state university, state community college, or district school board, unless restricted from FRS membership under sections 121.053 and 121.122, Florida Statutes, or allowed to
43 SOUTH FLORIDA REGIONAL TRANSPORTATION AUTHORITY NOTES TO THE FINANCIAL STATEMENTS FOR THE YEARS ENDED JUNE 30, 2017 AND 2016
Note 8 – Retirement Plan (Continued) participate in a defined contribution plan in lieu of FRS membership. Participation by cities, municipalities, special districts, charter schools and metropolitan planning organizations is optional.
The Retiree Health Insurance Subsidy (HIS) Program is a cost-sharing, multiple-employer defined benefit pension plan established and administered in accordance with section 112.363, Florida Statutes. The benefit is a monthly payment to assist retirees of the state-administered retirement systems in paying their health insurance costs. Eligible retirees and beneficiaries received a monthly HIS payment equal to the number of years of service credited at retirement multiplied by $5. The minimum payment is $30 and the maximum payment is $150 per month, pursuant to section 112.363, Florida Statutes. To be eligible to receive a HIS benefit, a retiree under one of the state administered retirement systems must provide proof of eligible health insurance coverage, which can include Medicare. Over 1,000 participating employers are served by the two defined benefit plans. SFRTA reports payroll and remit contributions to the division for their covered employees.
Benefits Provided
Florida Retirement System Plan
FRS provides retirement, disability and death benefits. The SFRTA contributes to the plan based on the rate and criteria established by the FRS. As of July 1, 2011, employees are required to contribute 3% to their pension or investment plan. Employees must be employed on a regular status basis to be covered by the FRS. Employees enrolled in the FRS before July 1, 2011 are vested in the Pension Plan after six years of service. Employees enrolled in the FRS on or after July 1, 2011 are vested in the Pension Plan after eight years of service. SFRTA employees are eligible for normal retirement, if they were enroll in the FRS before July 1, 2011, vested and are age 62 or have at least 30 years of creditable service.
If employees are enrolled in the FRS on or after July 1, 2011, they qualify for normal retirement when vested, and are age 65 or have 33 years of creditable service.
Retired employees are entitled to an annual retirement benefit, payable monthly for life, in an amount equal to their average final compensation multiplied by the total percentage value of their service time. Average final compensation is the average annual earnings of each employee’s length of service and membership class. The System also provides for death and disability benefits. These benefit provisions and State Statutes establish all other requirements.
Retirement Health Insurance Subsidy Program
HIS is an additional benefit under the FRS that assists participants in paying for a portion of the costs of their health insurance premiums after retirement. The HIS amount is based on the participants length of service with FRS-covered employers.
44 SOUTH FLORIDA REGIONAL TRANSPORTATION AUTHORITY NOTES TO THE FINANCIAL STATEMENTS FOR THE YEARS ENDED JUNE 30, 2017 AND 2016
Note 8 – Retirement Plan (Continued)
HIS is available after participants attain 6 years of FRS service credit (if enrolled in the FRS prior to July 1, 2011) or 8 years (if enrolled in the FRS on or after July 1, 2011), have reached normal retirement eligibility, and have retired from the FRS. The required years can be a combination of Pension Plan and Investment Plan service. To be eligible to receive the HIS under the Investment Plan, participants must meet the normal retirement age or service requirements. If participants leave FRS-covered employment and take a benefit distribution prior to their normal retirement age or date, participants must wait until they reach normal retirement age to begin receiving their HIS benefit.
Under the Pension Plan, benefit participants will receive the HIS regardless of whether participants take a normal or an early-retirement benefit, provided participants have proper documentation certifying they have health insurance coverage. If participants elect the Hybrid Option, they will receive their HIS payment once they begin receiving their Pension Plan benefit. Unlike under the 100% Investment Plan option, the HIS payment is available immediately, even if participants have not reached normal retirement.
The HIS subsidy, which is paid monthly, is $5 for each year of creditable service, with a minimum HIS of $30 and a maximum HIS of $150 per month.
Contributions
Florida Retirement System Plan
Under the FRS, the SFRTA was required to contribute, as of the start of fiscal year 2017, 5.86% of the salary of Regular Class employees, and 20.11% of the salary of Senior Management Class employees. The actual contributions made by the SFRTA for fiscal year ended 2017 totaled $834,346, which equals the annual required contribution for the current period.
The SFRTA Senior Management Class employees’ contribution rates for fiscal years 2016 and 2015 were 19.77% and 19.88%, respectively. Regular Class employees’ contribution rates for 2016 and 2015 were 5.60% and 6.11%, respectively. Actual contributions for fiscal years 2016 and 2015 were approximately $805,424 and $727,183, respectively, equaling the annual required contribution.
Retirement Health Insurance Subsidy Program
Under the FRS, the SFRTA’s required HIS contributions, as of the start of fiscal year 2017 was 1.66% of the salary of Regular Class employees and of the salary of Senior Management Class employees. The actual contributions made by the SFRTA for fiscal year ended 2017 totaled $14,084, which equals the annual required contribution for the current period.
The SFRTA Regular Class employees and SFRTA Senior Management Class employee contribution rates for fiscal years 2016 and 2015 were 1.66% and 1.26%, respectively. Actual contributions for fiscal years 2016 and 2015 were approximately $13,597 and $9,279, respectively, equaling the annual required contribution.
45 SOUTH FLORIDA REGIONAL TRANSPORTATION AUTHORITY NOTES TO THE FINANCIAL STATEMENTS FOR THE YEARS ENDED JUNE 30, 2017 AND 2016
Note 8 – Retirement Plan (Continued)
Pension Liabilities, Pension Expense, and Deferred Outflows of Resources and Deferred Inflows of Resources Related to Pensions
In accordance with GASB 68, paragraph 71, changes in the net pension liability are recognized in pension expense in the current measurement period, except as indicated below. For each of the following, a portion is recognized in pension expense in the current measurement period, and the balance is amortized as deferred outflows or deferred inflows of resources using a systematic and rational method over a closed period, as defined below: x Differences between expected and actual experience with regard to economic and demographic factors –amortized over the average expected remaining service life of all employees that are provided with pensions through the pension plan (active and inactive employees) x Changes of assumptions or other inputs – amortized over the average expected remaining service life of all employees that are provided with pensions through the pension plan (active and inactive employees) x Differences between expected and actual earnings on pension plan investments – amortized over five years
Contributions to the pension plans from employers are not included in collective pension expense. The average expected remaining service life of all employees provided with pensions through the pension plans at June 30, 2017, was 6.4 years for FRS and 7.2 years for HIS. The components of collective pension expense reported in the pension allocation schedules for the fiscal year ended June 30, 2017, are presented for each plan.
Florida Retirement System Plan At June 30, 2017, the SFRTA reported a liability of $6,203,690 for its proportionate share of the net pension liability. The net pension liability was measured as of June 30, 2016, and the total pension liability used to calculate the net pension liability was determined by an actuarial valuation as of that date. The SFRTA’s proportion of the net pension liability was based on a projection of the SFRTA’s long-term share of contributions to the pension plan relative to the projected contributions of all participating employers, actuarially determined. At June 30, 2017, the SFRTA’s proportion was 0.02 percent.
For the year ended June 30, 2017, the SFRTA recognized pension expense of $1,187,520. At June 30, 2017, the SFRTA reported deferred outflows of resources and deferred inflows of resources related to pensions from the following sources:
46 SOUTH FLORIDA REGIONAL TRANSPORTATION AUTHORITY NOTES TO THE FINANCIAL STATEMENTS FOR THE YEARS ENDED JUNE 30, 2017 AND 2016
Note 8 – Retirement Plan (Continued)
Deferred Deferred Outflows of Inflows of Resources Resources Difference between expected and actual experience $ 475,002 $ 57,761 Net difference between projected and actual investment earnings on pension plan investments 1,603,578 Changes in assumptions 375,305 - Changes in proportion and differences between SFRTA contributions and proportionate share of contributions 949,274 - SFRTA's contributions subsequent to the measurement date 834,346 - Totals$ 4,237,505 $ 57,761
The deferred outflow of resources related to the Pension Plan, totaling $834,346, resulting from contributions to the Plan subsequent to the measurement date, will be recognized as a reduction of net pension liability in the fiscal year ended June 30, 2018. Other amounts reported as deferred outflows or inflows of resources related to the Pension Plan will be recognized in the pension expense as follows:
Year Ended June 30: 2018 $ 460,812 2019 $ 460,812 2020 $1,333,662 2021 $ 912,748 2022 $ 134,253 Thereafter $ 43,111
Retirement Health Insurance Subsidy Program
At June 30, 2017, the SFRTA reported a liability of $3,130,849 for its proportionate share of the net pension liability. The net pension liability was measured as of June 30, 2016, and the total pension liability used to calculate the net pension liability was determined by an actuarial valuation as of that date. The SFRTA’s proportion of the net pension liability was based on a projection of the SFRTA’s long-term share of contributions to the pension plan relative to the projected contributions of all participating employers, actuarially determined. At June 30, 2017, the SFRTA’s proportion was 0.03 percent.
For the year ended June 30, 2017, the SFRTA recognized pension expense of $327,944. At June 30, 2017, the SFRTA reported deferred outflows of resources and deferred inflows of resources related to pensions from the following sources:
47 SOUTH FLORIDA REGIONAL TRANSPORTATION AUTHORITY NOTES TO THE FINANCIAL STATEMENTS FOR THE YEARS ENDED JUNE 30, 2017 AND 2016
Note 8 – Retirement Plan (Continued)
Deferred Deferred Outflows of Inflows of Resources Resources Difference between expected and actual experience $ - $ 7,131 Net difference between projected and actual investment earnings on pension plan investments 1,583 - Changes in assumptions 491,310 - Changes in proportion and differences between SFRTA contributions and proportionate share of contributions 374,439 - SFRTA's contributions subsequent to the measurement date 14,084 - Totals$ 881,416 $ 7,131
The deferred outflow of resources related to the Pension Plan, totaling $14,084, resulting from contributions to the Plan subsequent to the measurement date, will be recognized as a reduction of net pension liability in the fiscal year ended June 30, 2018. Other amounts reported as deferred outflows or inflows of resources related to the Pension Plan will be recognized in the pension expense as follows:
Year Ended June 30: 2018 $154,033 2019 $154,033 2020 $153,499 2021 $153,243 2022 $132,578 Thereafter $112,815
Florida Retirement System Plan
Actuarial Assumptions
The total pension liability for the FRS was determined by an actuarial valuation as of July 1, 2016 using the following actuarial assumptions, applied to all periods included in the measurement:
Inflation 2.60% Salary Increases including inflation 3.25% Investment rate of return 7.60%
48 SOUTH FLORIDA REGIONAL TRANSPORTATION AUTHORITY NOTES TO THE FINANCIAL STATEMENTS FOR THE YEARS ENDED JUNE 30, 2017 AND 2016
Note 8 – Retirement Plan (Continued)
Mortality rates were based on the Generational RP-2000 with Projection Scale BB tables.
The actuarial assumptions used in the July 1, 2016 valuation were based on the result of an actuarial experience study for the period July 1, 2008 –June 30, 2013.
Long-Term Expected Rate of Return
To develop an analytical basis for the selection of the long-term expected rate of return assumption, in October 2016 the FRS Actuarial Assumptions conference reviewed long-term assumptions developed by both Milliman’s capital market assumptions team and by a capital market assumptions team from Aon Hewitt Investment Consulting, which consults to the Florida State Board of Administration. The table below shows Milliman’s assumptions for each of the asset classes in which the plan was invested at that time based on the long-term target asset allocation. The allocation policy’s description of each asset class was used to map the target allocation to the asset classes shown below. Each asset class assumption is based on a consistent set of underlying assumptions, and includes an adjustment for the inflation assumption. These assumptions are not based on historical returns, but instead are based on a forward-looking capital market economic model.
Compound Annual Annual Target Arithmetic (Geometric) Standard Asset Class Allocation* Return Return Deviation Cash 1.0% 3.0% 3.0% 1.7% Fixed Income 18.0% 4.7% 4.6% 4.6% Global Equity 53.0% 8.1% 6.8% 17.2% Real Estate (property) 10.0% 6.4% 5.8% 12.0% Private Equity 6.0% 11.5% 7.8% 30.0% Strategic Investments 12.0% 6.1% 5.6% 11.1%
*As outlined in the Plan's investment policy
Discount Rate
The discount rate used to measure the total pension liability was 7.60%. The pension plan’s fiduciary net position was projected to be available to make all projected future benefit payments of current active and inactive employees. Therefore, the discount rate for calculating the total pension liability is equal to the investment rate of return.
49 SOUTH FLORIDA REGIONAL TRANSPORTATION AUTHORITY NOTES TO THE FINANCIAL STATEMENTS FOR THE YEARS ENDED JUNE 30, 2017 AND 2016
Note 8 – Retirement Plan (Continued)
Sensitivity of the SFRTA’s Proportionate Share of the Net Pension Liability to Changes in the Discount Rate
The following presents the SFRTA’s proportionate share of the FRS net pension liability calculated using the discount rate of 7.60%, as well as what the SFRTA’s proportionate share of the net pension liability would be if it were calculated using a discount rate that is 1-percentage- point lower, 6.60% or 1-percentage-point higher, 8.60% than the current rate:
1% Current 1% Decrease Discount Rate Increase 6.60% 7.60% 8.60% SFRTA's proportionate share of the net pension liability $11,421,413 $ 6,203,690 $ 1,860,624
Retirement Health Insurance Subsidy Program
Actuarial Assumptions
Because the HIS Program uses a pay-as-you-go funding structure, a municipal bond rate of 2.85% was used to determine the total pension liability for the program, using the following assumptions.
Inflation 2.60% Salary increases including inflation 3.25% Investment rate of return N/A
Mortality rates were based on the Generational RP-2000 with Projection Scale BB tables. The actuarial assumptions used in the July 1, 2016 valuation were based on the result of an actuarial experience study for the period July 1, 2008 –June 30, 2013.
Discount Rate
The discount rate used to measure the total pension liability was 2.85%. The pension plan’s fiduciary net position was projected to be available to make all projected future benefit payments of current active and inactive employees.
Sensitivity of the SFRTA’s Proportionate Share of the Net Pension Liability to Changes in the Discount Rate
The following presents the SFRTA’s proportionate share of the HIS net pension liability calculated using the discount rate of 2.85%, as well as what the SFRTA’s proportionate share of the net pension liability would be if it were calculated using a discount rate that is 1-percentage- point lower, 1.85% or 1-percentage-point higher, 3.85% than the current rate.
50 SOUTH FLORIDA REGIONAL TRANSPORTATION AUTHORITY NOTES TO THE FINANCIAL STATEMENTS FOR THE YEARS ENDED JUNE 30, 2017 AND 2016
Note 8 – Retirement Plan (Continued) 1% Current 1% Decrease Discount Rate Increase 1.85% 2.85% 3.85% SFRTA's proportionate share of the net pension liability $ 3,591,795 $ 3,130,849 $ 2,748,289
Payables to Pension Plan
At June 30, 2017, the SFRTA had $80,557 and $1,360 for FRS and HIS, respectively accrued as payables to the State of Florida FRS Pension Plan.
Pension Plan Fiduciary Net Position
Detailed information about the pension plan’s fiduciary net position is available in the separately issued FRS financial report.
Additional audited financial information is located in the State of Florida CAFR for the fiscal year ended June 30, 2016 and in the Florida Retirement System Pension Plan and Other-State-Administered Systems CAFR for the fiscal year ended June 30, 2016.
The FRS CAFR and actuarial reports may be obtained by contacting the Division of Retirement at:
Department of Management Services Division of Retirement Bureau of Research and Member Communications P. O. Box 9000 Tallahassee, FL 32315-9000 850-488-5706 or toll free at 877-377-1737
51 SOUTH FLORIDA REGIONAL TRANSPORTATION AUTHORITY NOTES TO THE FINANCIAL STATEMENTS FOR THE YEARS ENDED JUNE 30, 2017 AND 2016
Note 9 – Leases
The SFRTA lease of its office facilities was terminated on April 30, 2016. The lease term was extended for eleven months, and terminated on March 31, 2017. Both SFRTA and the Landlord had the right to terminate the Lease prior to the expiration of the First Extension Term by delivering written notice to the other party of its intent to terminate the Lease, which termination would have been effective on the date which is thirty (30) days from the date of such parties’ receipt of written notice. Rent expense for the fiscal years 2017 and 2016 were $558,838 and $713,033, respectively.
Note 10 – Contingencies and Commitments
Grants:
The SFRTA receives significant financial assistance from federal, state and local governmental agencies in the form of grants. The disbursement of funds received under these programs generally requires compliance with terms and conditions specified in the grant agreement and are subject to audit by the SFRTA’s independent auditors and other governmental auditors. Any disallowed claims resulting from such audits could become a liability of the SFRTA. Based on prior experience, the SFRTA’s management believes such disallowance, if any, would be immaterial.
Commitments:
The SFRTA’s commitments related to maintenance and operations are approximately $47.4 million as of June 30, 2017.
Contract Contract FY 2017 Contractor Name Inception Term Amount Purpose Amount Trans Dev Services Inc January 2007 10 years$ 105,916,013 Trains Operations 12,408,093 Bombardier Mass Transit Corporation March 2007 10 years 152,080,722 Train Maintenance 15,927,909 BV Oil Company January 2013 5 years 49,000,000 Train fuel 5,666,117 Keolis Transit Services January 2016 7 years 29,835,888 Feeder Bus service 4,688,067 Meridian Management Corporation August 2010 7 years 16,175,391 Station Maintenance 2,189,532 G4S Secure Solutions USA Inc November 2015 5 years 33,596,432 Trains Security 6,528,603 Total$ 386,604,446 $ 47,408,321
Construction Projects: As of June 30, 2017, the SFRTA has the following construction commitments. Contract Completed Contractor Name Project Amount to Date Balance HDR Engineering Wave$ 19,968,983 $ 15,608,462 $ 4,360,521 Xorail Positive Train Control 39,715,542 1,189,916 38,525,626 All Aboard Florida Trackage Improvements at Miami Central Station 16,190,000 1,451,688 14,738,312 Transdev (VTMI) Northwood Crossover 4,811,769 733,145 4,078,624 All Aboard Florida Downtown Miami Central Station 48,902,749 32,446,704 16,456,045 $ 129,589,043 $ 51,429,915 $ 78,159,128
52 SOUTH FLORIDA REGIONAL TRANSPORTATION AUTHORITY NOTES TO THE FINANCIAL STATEMENTS FOR THE YEARS ENDED JUNE 30, 2017 AND 2016
Note 10 – Contingencies and Commitments (Continued)
Risk Management:
The SFRTA’s risk of loss includes exposure from passengers and the public due to accidents or other incidents resulting in liability issues for the SFRTA. The State of Florida insures the SFRTA for liability up to $10 million. The SFRTA purchases additional general liability coverage, amounting to $285 million. The SFRTA has had no settlement claims that exceed the $10 million insurance coverage since its inception.
Note 11 – Subsequent Events
The SFRTA Management evaluated subsequent events through December 27, 2017, the date the financial statements were available to be issued. Events or transactions occurring after June 30, 2017, but prior to December 27, 2017, that provided additional evidence about conditions that existed at June 30, 2017, have been recognized in the financial statements for the year ended June 30, 2017. Events or transactions that provided evidence about conditions that did not exist at June 30, 2017, but arose before the financial statements were available to be issued, have not been recognized in the financial statements for the year ended June 30, 2017.
53 This page is intentionally left blank REQUIRED SUPPLEMENTARY INFORMATION
SCHEDULE OF SFRTA PROPORTIONATE SHARE OF THE NET PENSION LIABILITY-FRS SCHEDULE OF SFRTA CONTRIBUTIONS-FRS SCHEDULE OF SFRTA PROPORTIONATE SHARE OF THE NET PENSION LIABILITY -HIS SCHEDULE OF SFRTA CONTRIBUTIONS-HIS NOTES TO REQUIRED SUPPLEMENTARY INFORMATION
This page is intentionally left blank SOUTH FLORIDA REGIONAL TRANSPORTATION AUTHORITY FLORIDA RETIREMENT SYSTEM SCHEDULE OF SFRTA PROPORTIONATE SHARE OF THE NET PENSION LIABILITY LAST TEN FISCAL YEARS*
2017 2016 2015 SFRTA's proportion of the net pension liability (asset) 0.02% 0.02% 0.02%
SFRTA's proportionate share of the net pension liability (asset) $6,203,690 $ 3,016,796 $ 1,188,580
SFRTA's covered-employee payroll$ 8,625,109 $ 8,593,881 $ 7,197,336
SFRTA's proportionate share of the net pension liability (asset) as a percentage of its covered-payroll 71.93% 35.10% 16.51%
Plan fiduciary net position as a percentage of the total pension liability 84.88% 92.00% 96.09%
*Note: The amounts presented for each fiscal year were determined as of June 30th. Schedule is intended to show information for the last ten (10) years. Additional years will be displayed as they become available.
54
$ $ $ (646,741) $ 6,062,779 $ 646,741 $ - 54% 10.25% 10.67% (648,718) $ 6,331,421 $ 648,718 $ - (693,931) $ 6,580,834 $ 693,931 $ - (791,614) $ 6,502,509 $ 791,614 $ - (334,248) $ 7,118,732 $ 334,248 $ - (316,448) $ 6,773,818 $ 316,448 $ - (574,028) $ 6,709,416 $ 574,028 $ - LAST TEN FISCAL TEN LAST YEARS* FLORIDA RETIREMENT SYSTEM FLORIDA RETIREMENT of 6/30. of SCHEDULEOF SFRTA CONTRIBUTIONS (727,183) $ 7,658,629 $ 727,183 $ - 2017 2016 2015 2014 2013 2012 2011 2010 2009 2008 $ - (805,424) $ 8,593,881 $ 805,424 SOUTH FLORIDA REGIONAL TRANSPORTATION AUTHORITY TRANSPORTATION FLORIDA REGIONAL SOUTH Contribution deficiency (excess) deficiency Contribution - Contributions as a percentage of of percentage a as Contributions payrollcovered-employee as determined were year fiscal each for presented amounts *The 9.67% 9.37% 9.49% 8.56% 4.67% 4.70% 12.17% 10. Contributions in relation to the the to relation in Contributions contribution required contractually (834,346) SFRTA's covered-employee payroll covered-employee SFRTA's 8,625,109 Contractually required contribution required Contractually 834,346
55 SOUTH FLORIDA REGIONAL TRANSPORTATION AUTHORITY RETIREE HEALTH INSURANCE SUBSIDY SCHEDULE OF SFRTA PROPORTIONATE SHARE OF THE NET PENSION LIABILTY LAST TEN FISCAL YEARS*
2017 2016 2015 SFRTA's proportion of the net pension liability (asset) 0.03% 0.02% 0.02%
SFRTA's proportionate share of the net pension liability (asset) $3,130,849 $ 2,526,658 $ 2,053,964
SFRTA's covered-employee payroll$ 8,625,109 $ 8,593,881 $ 7,197,336
SFRTA's proportionate share of the net pension liability (asset) as a percentage of its covered-payroll 36.30% 29.40% 28.54%
Plan fiduciary net position as a percentage of the total pension liability 0.97% 0.50% 0.99%
*Note: The amounts presented for each fiscal year were determined as of June 30th. Schedule is intended to show information for the last ten (10) years. Additional years will be displayed as they become available.
56 $ $
$ $ - $ 6,331,421 (7,259) $ 7,259 % 0.11% 0.11% $ - $ 6,580,834 (7,282) $ 7,282 $ - $ 6,502,509 (7,789) $ 7,789 $ - $ 7,118,732 (8,886) $ 8,886 $ 6,773,818 $ - (3,752) $ 3,752 $ 6,709,416 $ - (3,552) $ 3,552 $ 7,197,336 $ - (6,972) $ 6,972 LAST TEN FISCAL TEN LAST YEARS* of 6/30. of SCHEDULEOF SFRTA CONTRIBUTIONS RETIREE HEALTH INSURANCE SUBSIDY INSURANCE HEALTH RETIREE $ 7,658,629 $ - (9,279) $ 9,279 2017 2016 2015 2014 2013 2012 2011 2010 2009 2008 $ 8,593,881 $ - (13,597) $ 13,597 SOUTH FLORIDA REGIONAL TRANSPORTATION AUTHORITY TRANSPORTATION FLORIDA REGIONAL SOUTH SFRTA's covered-employee payroll covered-employee SFRTA's 8,625,109 Contributions as a percentage of of percentage a as Contributions payrollcovered-employee as determined were year fiscal each for presented amounts *The 0.16% 0.16% 0.12% 0.10% 0.05% 0.06% 0.12% 0.12 Contribution deficiency (excess) deficiency Contribution - Contributions in relation to the the to relation in Contributions contribution required contractually (14,084) Contractually required contribution required Contractually 14,084
57 SOUTH FLORIDA REGIONAL TRANSPORTATION AUTHORITY REQUIRED SUPPLEMENTARY INFORMATION FOR THE YEAR ENED JUNE 30, 2017
The following changes in actuarial assumptions occurred in 2016:
• FRS: There were no changes in actuarial assumptions. The inflation rate assumption remained at 2.60%, the real payroll growth assumption remained at 0.65%, and the overall payroll growth rate assumption remained at 3.25%. The long-term expected rate of return decreased from 7.65% to 7.60%.
• HIS: The municipal rate used to determine total pension liability decreased from 3.80% to 2.85%.
58 This page is intentionally left blank OTHER SUPPLEMENTARY INFORMATION
SUPPLEMENTAL SCHEDULE OF OPERATING EXPENSES 2017 SUPPLEMENTAL SCHEDULE OF OPERATING EXPENSES 2016 This page is intentionally left blank $ $ 25,802,150 242,321 1,324,615 General and Total $ 111,033,972 $ 12,469,020 558,838 558,838 560,368 560,368 2,734,305 42,229,463 5,666,117 - 2,734,305 62,992,511 6,184,342 $ 12,451,712 $ 6,714,080 - 161,705 641,800 7,326,470 - $ 883,411 $ 713,906 - -- 25,363,659 - - - 6,434,204 - - 25,363,659 - - 2,478,385 anning Engineering Legal Administrative Expense $ 26,346,771 $ 958,162 - - 6,522,965 - - - 3,203 46,341 24,950 7,800 1,801,159 1,883,453 131,499 - 666,117 - 434,204 - 184,342 - 478,385 - 2,942,713 63,642,613 25,802,150 - 34,894,547 - FOR THE YEAR ENDED JUNE 30, 2017 ENDED JUNE YEAR FOR THE Operations Pl $ 7,709,465 $ 1,140,159 SOUTH FLORIDA REGIONAL TRANSPORTATION AUTHORITY TRANSPORTATION REGIONAL FLORIDA SOUTH SUPPLEMENTAL SCHEDULE OF OPERATING EXPENSES BY DEPARTMENT BY EXPENSES OF OPERATING SCHEDULE SUPPLEMENTAL TOTAL PROFESSIONAL FEES GENERAL & ADMINISTRATIVE EXP & ADMINISTRATIVE GENERAL Expense Business Office 3,203 46,341 24,950 7,800 1, Lease and Rentals and Lease - CORPORATE &CORPORATE COMMUNITY OUTREACH LABOR AND FRINGE BENEFITS LABOR AND FRINGE Train Fuel Train 5, SERVICES: Operations Train 14, Feeder Service Feeder 6, Security Expense Security 6, Insurance MAINTENANCE AND TRAIN STATION 2,
59 $ 21,630,440 441,819 1,526,713 General and Total $ 101,986,972 559,773 559,773 713,033 713,033 2,447,339 40,322,662 5,138,752 6,134,273 2,447,339 59,765,814 - $ 12,388,574 179,307 629,328 6,030,129 - - $ 822,132 -- - 25,764,313 - - - 5,990,343 - - 2,179,784 25,764,313 - - $ 26,468,303 - - 5,221,494 - - - 6,407 52,971 13,290 12,226 2,154,852 2,239,746 111,010 - 138,752 - 990,343 - 134,273 - 179,784 - 55,831,786 $2,640,777 $1,201,712 $690,700 $630,599 $6,597,282 $11,761,070 31,554,162 - 21,630,440 - FOR THE YEAR ENDED JUNE 30, 2016 ENDED JUNE YEAR FOR THE Operations Planning Engineering Legal Administrative Expense $ 6,476,177 SOUTH FLORIDA REGIONAL TRANSPORTATION AUTHORITY TRANSPORTATION REGIONAL FLORIDA SOUTH SUPPLEMENTAL SCHEDULE OF OPERATING EXPENSES BY DEPARTMENT BY EXPENSES OF OPERATING SCHEDULE SUPPLEMENTAL PROFESSIONAL FEES GENERAL & ADMINISTRATIVE EXP & ADMINISTRATIVE GENERAL Expense Business Office Rentals and Lease 6,407 - 52,971 13,290 12,226 1, TOTAL CORPORATE &CORPORATE COMMUNITY OUTREACH SERVICES: Operations Train 12, LABOR AND FRINGE BENEFITS LABOR AND FRINGE Train Fuel Train 5, Feeder Service Feeder 5, Security Expense Security 6, Insurance 2, TRAIN AND STATION MAINTENANCE AND TRAIN STATION
60 This page is intentionally left blank This page is intentionally left blank STATISTICAL SECTION
NET POSITION AND CHANGES IN NET POSITION STATISTICAL AND GENERAL INFORMATION FARE STRUCTURE RIDERSHIP AND SALES ANALYSIS POPULATIONS TRENDS PASSENGER RIDERSHIP AND POPULATION TRENDS FOR FY 2007-2016 PRINCIPAL EMPLOYERS BY COUNTY DEMOGRAPHICS AND ECONOMIC STATISTICS CAPITAL ASSET STATISTICS & EMPLOYEES BY DEPARTMENT TRAIN SCHEDULE This page is intentionally left blank SOUTH FLORIDA REGIONAL TRANSPORTATION AUTHORITY STATISTICAL SECTION
This part of SFRTA’s CAFR presents detailed information as a context for understanding what the information in the financial statements, note disclosures, and required supplementary information says about SFRTA’s overall financial health.
Contents Page
Financial Trend Information 62 These schedules contain trend information to help the reader understand how SFRTA’s financial performance and well-being have changed overtime.
Revenue Capacity Information 65 These schedules contain information to help the reader assess SFRTA’s most significant local revenue consideration, namely ridership.
Demographic and Economic Information 67 These schedules offer demographic and economic data to help the reader understand how the environment within which SFRTA’s financial activities take place.
Operating Information 71 These schedules contain service and infrastructure data to help the reader understand how the information in SFRTA’s financial report relates to the services the SFRTA provides and the activities it performs.
61 544 ,995 ,654 $9,155,673 -- 9,753 576,093,336 300,677 455,842 - - (7,647,992) - 67,459 517,571 1,215,814 88,971 100,000 100,000 - 21,056) (10,008,914) 4,819,961 (12,063,623) ,709,187 2,676,621 5,305,758 4,201,053 ,101,199 752,663 815,946 656,692 2,794,894 57,895,362 62,104,656 61,790,668 00 1,565,000 4,235,000 4,135,298 4,366,950 64 93,921,134 86,931,965 72,030,822 89,331,013 5,000 1,565,000 4,235,000 4,135,298 4,366,953 00,229 45,274,303 41,553,969 41,419,340 43,602,003 051,728 45,603,117 38,563,865 38,165,029 31,647,664 ,565,000 1,565,000 4,235,000 4,135,297 4,375,718 ,474,248 7,765,896 7,204,108 7,827,025 6,490,508 0,152,899 19,444,152 16,534,534 13,152,968 8,316,789 5,827,417 $604,647,780 $610,868,836 $620,877,750 $616,057,789 0,981,100 34,035,858 32,418,169 14,657,549 32,228,595 25,470,702 24,905,184 19,027,689 14,746,127 23,289,207 3,242 $11,940,427 $10,902,136 $10,294,670 $9,744,718 $8,699,831 000 4,000,000 4,000,000 4,000,000 4,000,000 4,000,000 2,149,879 182,449 58,795,809 53,486,814 51,563,816 47,388,283 52,059,261 52,634 621,111 19,163,234 13,371,554 9,119,944 11,896,620 16,146,204 15,628, ,100,115 $12,575,652 $12,272,397 $11,231,078 $10,507,079 $10,045,395 ,600,000 30,600,000 30,600,000 2,494,587 18,130,233 18,577,351 19,806 (Restated) 59 530,601,966 529,771,415 533,622,790 539,600,511 555,770,437 569,55 ,506 - 13,700 374,156 30,600,000 - - - LAST TEN FISCAL YEARS NET POSITION AND CHANGES IN NET POSITION Statement No. 68. No. Statement SOUTH FLORIDA REGIONAL TRANSPORTATION AUTHORITY 017 2016 2015 2014* 2013 2012 2011 2010 2009 2008 5,995,776 26,952,264 5,064,778 2,122,259 (5,903,742) (8,820,363) (6,2 103,258,651 102,201,506 91,246,090 73,282,564 71,371,461 65,759,211 6 143,848,462 134,502,938 120,697,573 106,460,252 100,249,658 96,031,5 $626,082,951 $620,087,175 $593,134,911 $588,070,132 $589,923,675 $59 TOTAL REVENUES TOTAL Restricted 23,535,651 31,091,581 42,980,686 42,573,001 39,163,096 42, Unrestricted 10,570,264 18,344,503 18,129,966 14,895,165 20,989,164 2 Feeder Service Grant Pass-Through Grant Service Feeder ------INCREASE (DECREASE) IN NET POSITION NET IN (DECREASE) INCREASE NET POSITIONNET AT YEAR-END Net Investment in capital assets 620,087,175 570,651,091 532,024,2 Total non-operating Revenues 89,167,245 88,639,028 78,046,554 60, TOTAL NET POSITION POSITION NET TOTAL FISCAL YEARS FISCAL 2 Engineering 26,346,771 26,468,303 13,824,811 894,589 859,774 809,221 1 *Restatement of Net Position due to the implementation of GASB GASB of implementation the to due Position Net of *Restatement OPERATING REVENUES OPERATING Train revenue $12,785,301 $13,114,959 $12,783,183 $12,799,800 $12,04 Legal 883,411 822,132 591,517 671,479 645,792 662,184 - - - - Palm Beach County 1,565,000 1,565,000 1,565,000 1,565,000 1,565,000 1 Other 1,306,105 447,519 416,353 300,315 532,410 331,970 328,942 212,409 OPERATING EXPENSES OPERATING Operating 63,642,613 55,831,786 56,731,271 58,463,863 52,820,211 49,9 Depreciation 32,814,490 32,515,966 32,686,280 31,059,490 30,214,462 3 Florida Dept. of Transportation 42,100,000 42,100,000 30,600,000 30 Total Operating Revenues $14,091,406 $13,562,478 $13,199,536 $13 NON-OPERATING REVENUES NON-OPERATING Interest income 433,412 280,247 95,094 81,543 139,080 194,902 176,514 1 Contributions 46,585,587 59,253,696 34,516,261 35,299,947 23,827,329 Administrative 12,451,712 12,388,574 10,499,270 9,631,877 8,531,337 7 MarketingPlanning 7,709,465 - 6,476,177 6,364,424 - 5,738,954 7,178,082 - 4,913,323 3 - - 1,291,259 2,034,691 2,326,435 2,005,204 2,152,162 Florida Dept. of Transportation (MOW) 13,124,939 13,160,036 12,466 TOTAL EXPENSES TOTAL Federal Transit Administration 24,629,099 24,218,950 26,005,159 20, Dade County 1,565,000 1,565,000 1,565,000 1,565,000 1,565,000 1,565,0 Other Funding 184,795 184,795 184,795 184,795 184,795 251,202 477,771 4 Other Income (Expense) - - - - - (3,240,268) - - - (164,493) Federal Highway Administration 4,000,000 4,000,000 4,000,000 4,000, Broward County Feeder ------312,242 624,483 Special Items - - - (852,874) (778,444) Broward County 1,565,000 1,565,000 1,565,000 1,565,000 1,565,000 1,56
62 SOUTH FLORIDA REGIONAL TRANSPORTATION AUTHORITY FARE STRUCTURE
Fiscal Year Ended June 30, 2017
Date the Authority Began Operations ………………… January 9, 1989
Form of Governance……………………………………… Governing Board with an Executive Director and Deputy Executive Director
Number of Board Members Ten
Current Budgeted Employees 127.5
Service Areas……………………………………………… Broward, Miami-Dade and Palm Beach Counties
Tri-County Area in Square Miles………………………….. 5,128 Square Miles
Population of Service Area………………………………… Approximately 5.5 Million
Annual Operating Budget………………………………….. $107.8 Million
Supporting Subsidies……………………………………….. Florida Department of Transportation Federal Transit Administration Federal Highway Administration Broward, Miami Dade and Palm Beach Counties
Track Miles…………………………………………………... 71.7 Miles
Passengers Served…………………………………………….. 4,260,792
Service Levels…………………………………………………. Weekday – 50 Trains Saturday – 30 Trains Sunday – 30 Trains
Holiday Service………………………………………………. Tri-Rail operates a Sunday schedule on New Year’s Day, Memorial Day, Fourth of July, Labor Day, Thanksgiving Day and Christmas Day
Hours of Operating Weekday………………………………………………. 4:00 a.m. - 11:35 p.m. Saturday………………………………………………... 5:20 a.m. – 11:45 p.m. Sunday…………………………………...... 5:20 a.m. – 11:45 p.m.
Bus and Metrorail Service……………………………………. Convenient transfers to county transit buses that pass within ¼ mile of the Tri- Rail Station and convenient transfers onto Metrorail/Metromover.
63 SOUTH FLORIDA REGIONAL TRANSPORTATION AUTHORITY FARE STRUCTURE
As part of the South Florida Regional Transportation Authority (SFRTA), Tri-Rail has a zone fare system, which consists of six zones. Ticket prices are determined by the number of zones through which a passenger travels, with the exception of the monthly and special event tickets, which are at a flat fare. This fare policy is valid for weekday travel Monday through Friday.
Since Tri-Rail’s core ridership primarily consists of commuters to and from work and/or school, a weekend fare policy was designed to encourage increased ridership on Saturday and Sunday. Weekend tickets are sold at a flat fare of $5 and are valid for the entire day.
The SFRTA/Tri-rail offers several ticket types to meet the needs of every passenger. Frequent riders can take advantage of multi-trip, cost saving packages by purchasing a Monthly, 12-Trip tickets or Monthly Regional Passes. Other passengers can purchase daily One-Way or Roundtrip tickets. Discount tickets are also available for children ages 5 – 12, full-time students, and senior citizens ages 65 years and over, persons with disabilities and Medicare recipients.
Tickets are sold at all Tri-Rail stations from Tri-Rail’s ticket vending machines (TVMs) and supplemented by Ticket Agents at Tri-Rail’s busiest stations. No ticket sales are available on the train.
Discount Zones One Discount Round- Discount 12 Trips Monthly Discount Regional Regional Way One Way trip Roundtrip Monthly Monthly Monthly 12.50$ $4.40 1.25 $2.50$$ 21.25 $ 100.00 $ 50.00 $ 145.00 $ 72.50 23.75$ $6.25 1.90 $3.75$$ 31.25 $ 100.00 $ 50.00 $ 145.00 $ 72.50 35.00$ $8.45 2.50 $5.00$$ 41.90 $ 100.00 $ 50.00 $ 145.00 $ 72.50 45.65$ $9.70 2.80 $5.65$$ 47.50 $ 100.00 $ 50.00 $ 145.00 $ 72.50 56.25$ $ 3.15 $6.25 10.65 $$ 52.50 $ 100.00 $ 50.00 $ 145.00 $ 72.50 66.90$ $ 3.45 $6.90 11.55 $$ 57.50 $ 100.00 $ 50.00 $ 145.00 $ 72.50
Ticket purchases can also be made through special discount programs offered by SFRTA/Tri-Rail. The Employer Discount Program (EDP) offers a 25% discount on Monthly tickets, Monthly Regional Passes or 12-Trip tickets as a benefit program for employees whose employer has registered with the Program. The SFRTA/Tri-Rail also offers a Group Discount Program, which offers a discounted rate to groups of 25 or more passengers.
Special train services to certain events are occasionally provided by the SFRTA/Tri-Rail throughout the year. Most special event trains have a fare which is different from the regularly published fare; therefore, passengers are expected to select the appropriate special event when purchasing tickets from the TVM’s.
64 SOUTH FLORIDA REGIONAL TRANSPORTATION AUTHORITY RIDERSHIP AND SALES ANALYSIS
Ridership during fiscal year 2017, increased by 21,121 riders or .50% from fiscal year 2016. The following table illustrates passenger ridership for fiscal years 2016 and 2017.
Passenger Ridership – FY 2017 and FY 2016
FY 2017 FY 2016 YTD Ridership to Date Ridership to Date Ridership 17 vs. 16 % Monday to Friday 3,578,782 3,569,554 0.26%
Saturday 355,135 346,524 2.48%
Sunday 304,208 296,233 2.69%
Holidays 22,667 27,360 -17.15%
Totals 4,260,792 4,239,671 0.50%
Passenger Ridership FY 2008 thru 2017
Monday to Year Totals Saturday Sunday Holidays Friday 2008 3,862,450 3,363,349 245,617 220,797 32,687 2009 4,222,850 3,666,535 275,578 241,548 39,189 2010 3,606,055 3,088,102 261,168 231,816 24,969 2011 3,810,590 3,304,729 256,732 227,714 21,415 2012 3,990,857 3,456,558 276,504 228,704 29,091 2013 4,198,656 3,615,561 297,646 258,073 27,376 2014 4,401,218 3,726,040 344,290 298,011 32,877 2015 4,292,234 3,614,907 348,862 295,440 33,025 2016 4,239,371 3,569,554 346,524 296,233 27,360 2017 4,260,792 3,578,782 355,135 304,208 22,667 Source: SFRTA – Tri-Rail
65 SOUTH FLORIDA REGIONAL TRANSPORTATION AUTHORITY RIDERSHIP AND SALES ANALYSIS (Continued)
Passenger fares collected for fiscal year 2017 were $12,785,301 a decrease of $329,658 from fiscal year 2016. Tickets are sold at the train stations or from the administrative office by means of direct billing or through a specially designed ticket discount program.
Total Agency Ticket Sales - FY 2017
2.0%
12.9% 2.4%
EDP Agent Sales School Districts TVM Sales 82.7%
GRAPH KEY:
TVM – Ticket Vending Machines EDP – Employee Discount Program Agent Sales – Tickets sold at Kiosks School Districts – Palm Beach School District
66 SOUTH FLORIDA REGIONAL TRANSPORTATION AUTHORITY POPUATION TRENDS
Density Per Square Mile Total Population Square Miles Density Per Square Mile
Florida 53,937 374 Broward County 1,209 1,534 Miami-Dade County 1,945 1,386
Palm Beach County 1,974 705
Annual Population Annual Annual Annual Percent Population 2016 Population 2015 Change (Thousands) (Thousands)
Florida 20,148,654 19,815,183 1.68% Broward County 1,854,513 1,827,367 1.49% Miami-Dade County 2,696,353 2,653,934 1.60% Palm Beach County 1,391,741 1,378,417 0.97%
Projected Population 2017 - 2037 Projected Population 2017 2027 2037 Percent Change
Year (Thousands) (Thousands) (Thousands) 2017-2037 Florida 20,367,465 23,120,761 25,459,098 25.00% Broward County 1,846,952 1,975,884 2,078,499 12.54% Miami-Dade County 2,704,301 3,003,626 3,271,333 20.97% Palm Beach County 1,412,167 1,572,897 1,702,442 20.56% http://edr.state.fl.us/Content/population-demographics/data/index-floridaproducts.cfm
Population Trends FY 2008 thru 2017 Miami-Dade Palm Beach Tri-County Annual % Year Florida Broward County County County Total Change 2008 18,613,905 1,739,708 2,472,387 1,307,784 5,519,879 0.49% 2009 18,687,425 1,738,093 2,480,537 1,312,016 5,530,646 0.20% 2010 18,801,310 1,748,066 2,496,457 1,320,134 5,564,657 0.61% 2011 18,905,048 1,753,162 2,516,537 1,325,758 5,595,457 0.55% 2012 19,074,434 1,771,099 2,551,290 1,335,415 5,657,804 1.11% 2013 19,259,543 1,784,715 2,582,375 1,345,652 5,712,742 0.97% 2014 19,507,369 1,803,903 2,613,692 1,360,238 5,777,833 1.14% 2015 19,789,625 1,818,678 2,643,826 1,378,417 5,840,921 1.09% 2016 20,148,654 1,854,513 2,696,353 1,391,741 5,942,607 1.74% 2017 20,367,465 1,846,952 2,704,301 1,412,167 5,963,420 0.35% 67 SOUTH FLORIDA REGIONAL TRANSPORTATION AUTHORITY DEMOGRAPHIC AND ECONOMIC STATISTICS Principal Employers by County Last Fiscal Year & Nine Years Ago
BROWARD COUNTY
% of Total % of Total 2016 County 2007 County Rank Employer Employees Employment Rank Employer Employees Employment 1 Broward County School Board 31,880 3.19% 1 Broward County School Board 36,853 3.68% 2 Broward County Government 11,585 1.16% 2 Broward County Government 12,705 1.27% 3 Memorial Healthcare System 11,200 1.12% 3 Memorial Healthcare System 9,370 0.94% 4 Broward Health 8,219 0.82% 4 Broward Health 7,472 0.75% 5 AutoNation 3,971 0.40% 5 American Express 4,200 0.42% 6 Nova Southeastern University 3,783 0.38% 6 Motorola 3,500 0.35% 7 American Express 3,200 0.32% 7 Pediatrix Medical Group 2,826 0.28% 8 The Answer Group 2,800 0.28% 8 BCF Financial Corp/Bank 2,547 0.25% Atlantic 9 Broward College 2,800 0.28% 9 City of Fort Lauderdale 2,250 0.22% 10 City of Fort Lauderdale 2,457 0.23% 10 Ed Morse Automotive Group 2,200 0.22% Source: http://www.broward.org/Accounting/Documents/2015CAFR.pdf
MIAMI-DADE COUNTY
% of Total % of Total 2016 County 2007 County Rank Employer Employees Employment Rank Employer Employees Employment 1 Miami-Dade County Public 31,000 2.35% 1 Miami-Dade County Public 50,000 4.31% Schools Schools 2 Miami-Dade County 24,692 1.87% 2 Miami-Dade County 32,000 2.76% 3 U.S. Federal Government 19,300 1.46% 3 U.S. Federal Government 20,400 1.76% 4 Florida State Government 19,200 1.45% 4 Florida State Government 17,000 1.47% 5 University of Miami 13,864 1.05% 5 Baptist Health South Florida 10,826 0.93% 6 Baptist Health South Florida 13,369 1.01% 6 Jackson Health System 10,500 0.91% 7 American Airlines 11,773 0.89% 7 University of Miami 9,874 0.85% 8 Jackson Health System 8,163 0.62% 8 American Airlines 9,000 0.78% 9 Florida International University 4,951 0.37% 9 Miami Dade College 6,500 0.56% 10 City of Miami 3,820 0.29% 10 Precision Response Corporation 6,000 0.52% Source: http://www.miamidade.gov/finance/library/CAFR/2012/CAFR2015-complete.pdf
PALM BEACH COUNTY
% of Total % of Total 2016 County 2007 County Rank Employer Employees Employment Rank Employer Employees Employment 1 Palm Beach County School Board 22,000 3.21% 1 Palm Beach County School Board 21,616 3.35% 2 Palm Beach County Government 11,505 1.68% 2 State Government 9,200 1.43% 3 Tenet Healthcare Corporation 6,100 0.89% 3 Palm Beach County Government 6,594 1.02% 4 NextEra Energy (FPL) 3,854 0.56% 4 Federal Government 6,300 0.98% 5 Hospital Corporation of America 2,712 0.40% 5 Hospital Corporation of America 5,200 0.81% 6 Florida Atlantic University 2,655 0.39% 6 United Rental Highway Techs 5,000 0.77% 7 Bethesda Memorial Hospital 2,600 0.38% 7 Tenet Healthcare Corp. 4,794 0.74% 8 Boca Raton Regional Hospital 2,500 0.36% 8 NextEra Energy (FPL) 2,850 0.44% 9 Veterans Health Administration 2,500 0.36% 9 G4S (Wackenhut Corp) 2,825 0.44% 10 Jupiter Medical Center 2,250 0.29% 10 Boca Raton Resort & Club 2,200 0.34% Source: http://www.mypalmbeachclerk.com/uploadedFiles/Public_Funds/County_Financial_Reports/cafr_fy2015.pdf
68 SOUTH FLORIDA REGIONAL TRANSPORTATION AUTHORITY DEMOGRAPHIC AND ECONOMIC STATISTICS
PER CAPITA
PERSONAL INCOME PERSONAL INCOME UNEMPLOYMENT RATE
POPULATION (in millions)
% Change from % Change from FloridaU.S. Florida U.S. Florida U.S. Florida U.S. Prior Year Prior Year Year 2007 18,446,768 1.61% 301,231,207 0.96% 703,288 11,389,840 39,774 39,837 4.00% 4.60% 2008 18,613,905 0.91% 304,093,966 0.95% 731,746 11,995,740 39,832 41,113 6.30% 5.80% 2009 18,687,425 0.39% 306,771,529 0.88% 736,198 12,430,568 37,410 39,426 10.4% 9.30% 2010 18,801,332 0.61% 309,343,863 0.84% 696,487 12,082,091 38,823 40,334 11.1% 9.60% 2011 18,905,070 0.55% 311,718,857 0.77% 725,436 12,435,193 40,973 42,521 10.0% 8.90% 2012 19,074,434 0.90% 314,102,623 0.76% 761,303 13,191,317 41,856 44,301 8.50% 8.10% 2013 19,259,543 0.97% 316,427,395 0.74% 792,255 13,743,772 42,040 44,460 7.30% 4.30% 2014 19,507,369 1.29% 318,907,401 0.78% 813,904 14,126,650 43,582 46,077 6.30% 6.20% 2015 19,815,183 1.58% 321,418,820 0.79% 850,671 14,765,520 45,041 47,794 5.40% 5.30% 2016 20,148,654 1.68% 323,889,854 0.77% 940,615 15,970,750 46,684 49,309 4.80% 4.90% http://www.myfloridacfo.com/aadir/statewide_financial_reporting/1entirecafr16.pdf Broward County Miami-Dade County
Per Capita Per Capita Total Personal Unemployment Total Personal Unemployment Population Personal Population Personal Income Rate Income Rate Income Income Year Year 2007 1,741,657 $ 72,829,950 $41,816 4.00% 2007 2,402,208 $85,978,571 $35,791 3.60% 2008 1,739,708 $ 72,138,045 $41,466 6.30% 2008 2,387,170 $88,954,732 $37,264 5.30% 2009 1,738,093 $ 67,660,182 $38,928 9.60% 2009 2,398,245 $90,915,774 $37,909 8.90% 2010 1,748,066 $ 70,231,274 $40,177 10.20% 2010 2,563,885 $92,227,399 $35,972 12.0% 2011 1,753,162 $ 73,868,561 $42,134 9.00% 2011 2,516,515 $97,815,794 $38,870 12.7% 2012 1,771,099 $ 76,222,564 $43,037 7.70% 2012 2,551,255 $100,688,604 $39,466 9.70% 2013 1,784,715 $ 76,873,297 $43,073 6.50% 2013 2,565,685 $104,373,301 $40,680 8.90% 2014 1,803,903 $ 80,905,552 $44,850 5.80% 2014 2,586,290 $111,528,866 $43,123 7.20% 2015 1,827,367 $ 85,167,498 $46,607 4.90% 2015 2,653,934 $116,553,169 $43,917 6.20% 2016 1,854,513 N/A N/A 4.60% 2016 2,696,353 N/A N/A 5.80% http://www.broward.org/Accounting/Documents/2016CAFR.pdf http://www.miamidade.gov/finance/library/CAFR/015/CAFR2016-complete.pdf Palm Beach County
Per Capita Total Personal Unemployment Population Personal Income Rate Income Year 2007 1,295,033 $75,585,800 $58,749 4.80% 2008 1,294,654 $76,712,607 $59,240 7.30% 2009 1,287,344 $67,866,247 $51,910 11.7% 2010 1,320,134 $69,488,201 $52,526 12.4% 2011 1,325,758 $72,053,531 $53,871 10.9% 2012 1,335,415 $75,461,490 $55,628 9.20% 2013 1,345,652 $79,564,774 $57,985 7.10% 2014 1,360,248 $93,526,272 $66,914 6.00% 2015 1,378,417 $97,806,900 $68,743 5.30% 2016 1,391,741 N/A N/A 4.80% http://www.mypalmbeachclerk.com/uploadedFiles/Public_Funds/County_Financial_Reports/cafr_fy2016.pdf
69 SOUTH FLORIDA REGIONAL TRANSPORTATION AUTHORITY
SOUTH FLORIDA REGIONAL TRANSPORTATION AUTHORTY CAPITAL ASSET STATISTICS
ASSET 2017 2016 2015 2014 2013 2012 2011 2010 2009 2008
Stations 18 18 18 18 18 18 18 18 18 18 Administration/Buildings1111111222
Commuter Rail 2017 2016 2015 2014 2013 2012 2011
Weekday Trips Daily 50505050505050 Saturday Trips Daily 30 30 30 30 30 16 16 Sunday Trips Daily 30 30 30 30 30 16 16 Holiday Trips Annually 180 180 180 180 180 96 96 Total Trips Annually 16,050 16,050 16,050 16,050 16,050 14,476 14,476 Boarding Annually 4,260,792 4,239,680 4,292,234 4,401,318 4,198,656 4,005,967 3,810,832 Train Revenue Hours Annually 37,474 39,431 37,510 33,956 33,956 32,960 34,900
EMPLOYEES BY DEPARTMENT LAST TEN FISCAL YEARS NUMBER OF EMPLOYEES
DEPARTMENT 2017 2016 2015 2014 2013 2012 2011 2010 2009 2008
Executive 15 15 15 17 18 17 12 13 14 12 Finance & IT 17 17 17 24 23 24 23 21 22 23 Planning 12 13 13 11 9 10 10 9 9 8 Engineering8775444444 Human Resources3333223233 Contracts & Procurement10999989887 Marketing00000024192123 Operations 40.540.540.542424427262724 Legal 33332222N/AN/A Safety & Security5550000000 Information & Technology1414140000000 TOTAL 127.5 126.5 126.5 114 109 111 114 104 108 104
70 0
71 TIMELINE
x New RTA Operations Center opens in Pompano 2017 Beach, FL x x MiamiCentral will serve as downtown Miami’s multimodal hub, providing connections to All 2016 Aboard Florida (AAF), Tri-Rail, Miami-Dade County bus system, Metrorail, and Metromover. x x Opening of the new Miami Intermodal Center (MIC) at the Miami Airport. Construction on the 2015 new Operations Center and Pompano Beach Station improvements began in May. x x Tri-Rail receives its first GFOA Budget Award. SFRTA announces plans for a new 2014 Operations/Administrative Center. FDOT and CSX agreed to transfer dispatch to SFRTA. x 2012x New Hyundai Rotem cars begin arriving. x x Tri-Rail celebrates 20th Anniversary. Tri-Rail 2009 implements first fare increase in more than 14 years. x x The American Public Transportation Association (APTA) announces Tri-Rail as the fastest growing 2007 commuter rail system in the country for 2006. The SFRTA implements full schedule of 50 Tri-Rail trains a day. x x Tri-County Transportation Summit launches 2002 initiative for formation of Regional Transportation Authority (RTA). x x New Fort Lauderdale/Hollywood International 2000 Airport Station at Dania Beach opens. Award winning tropical train wrap unveiled. x 1998x Tri-Rail opens new Miami Airport Station. x x Opening of Sheridan Street Station and Opa- 1996 Locka Station. Installation of TVMs complete. x x Tri-Rail signs Interlocal Agreement with FDOT 1994 and Miami-Dade, Broward and Palm Beach counties. x 1989x Tri-Rail begins operation. x x FDOT purchases 81-mile piece of the South Florida Rail Corridor from CSXT for $264 1988 million. TCRO becomes the Tri-County Commuter Rail Authority (Tri-Rail).
72 SOUTH FLORIDA REGIONAL TRANSPORTATION AUTHORITY AGENCY TAKES NATIONAL, REGIONAL AND STATEWIDE HONORS
The accolades continued to flow to the South Florida Regional Transportation Authority with multiple departments scoring honors and awards this past year. During fiscal year 2017, the SFRTA received the following awards:
PROCUREMENT
x National ProcurementInstitute-Achievement of Excellence inProcurement x Florida Association of Public Procurement- Award of Excellence in Public Procurement
MARKETING
x 1st Place Award American Public Transportation Association AdWheel Award for the special event “Ride and Play” x 1st Place Awards Florida Public Transportation Authority “Take the Train to the Plane” airport campaign o “Sustaining Campaign Category” o “Judge’s Favorite Award”
FINANCE
x Government Finance Officers Association Certificate of Achievement for Excellence in Financial Reporting for the Fiscal Year Ended 2016 x Government Finance Officers DistinguishedBudgetPresentationAwardfor theFiscalYear beginning July 1, 2017
73 Mangonia Park 45th St. West Palm Beach Palm Beach Banyan Blvd. & Tamarind Av. International Airport ? SYSTEM MAP Lake Worth Lake Worth Rd.
Tri-Rail Station Boynton Beach a/images/ Gateway Blvd. Free Tri-Rail Shuttle @Station PALMPALM BEACH L Direct Shuttle Route to Airport Delray Beach Temp_toplines2. Congress Av. Miami-Dade Metrorail Metrorail Station gif Boca Raton T Transfer Station Yamato Rd. Metrorail Orange Line Deerfield Beach Metrorail Green Line Hillsboro Blvd. ? International Airport Pompano Beach Sample Rd. & NW 8th Av Access to Amtrak Cypress Creek Cypress Creek Rd. & Powerline Rd. BROWARD Ft. Lauderdale Broward Blvd.
Fort Lauderdale-Hollywood Ft. Lauderdale-Hollywood ? International Airport Int' Airport at Dania Beach Griffin Rd.
Sheridan Street
Hollywood Hollywood Blvd.
Golden Glades
¯b Metrorail Opa-Locka Ali Baba Ave. Transfer NW 79th St. T North- side Dr. Martin Luther King, Jr.
Hialeah Hialeah Brownsville Palmetto Earlington Hts.
Okeechobee Okeechobee Hialeah
Market Allapattah SE 12th St. Miami International Santa Clara Airport ? Civic Center
Miami Intermodal Culmer Overtown/Lyric Theatre Government Center Tri-Rail and Center (MIC) Brickell Amtrak to service Vizcaya MIAMI - DADE Coconut Grove Miami Intermodal Douglas Road Center (MIC) University in 2013. South Miami Dadeland North Dadeland South
74 SOUTH FLORIDA REGIONAL TRANSPORTATION AUTHORITY
REPORTS REQUIRED BY THE UNIFORM GUIDANCE AND CHAPTER 10.550 RULES OF THE AUDITOR GENERAL OF THE STATE OF FLORIDA
FOR THE FISCAL YEAR ENDED JUNE 30, 2017 SOUTH FLORIDA REGIONAL TRANSPORTATION AUTHORITY REPORTS REQUIRED BY THE UNIFORM GUIDANCE AND CHAPTER 10.550 RULES OF THE AUDITOR GENERAL OF THE STATE OF FLORIDA FOR THE FISCAL YEAR ENDED JUNE 30, 2017
TABLE OF CONTENTS
Page
SCHEDULE OF EXPENDITURES OF FEDERAL AWARDS AND STATE FINANCIAL ASSISTANCE ...... 1 and 2
NOTES TO SCHEDULE OF EXPENDITURES OF FEDERAL AWARDS AND STATE FINANCIAL ASSISTANCE ...... 3
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 ...... 4 and 5
INDEPENDENT AUDITOR’S REPORT ON COMPLIANCE FOR EACH MAJOR AND STATE PROJECT AND ON INTERNAL CONTROL OVER COMPLIANCE REQUIRED BY THE UNIFORM GUIDANCE AND CHAPTER 10.550, RULES OF THE AUDITOR GENERAL ...... 6 and 7
SCHEDULE OF FINDINGS AND QUESTIONED COSTS ...... 8 and 9
SCHEDULE OF PRIOR YEAR FINDINGS ...... 10
INDEPENDENT AUDITOR’S MANAGEMENT LETTER ...... 11 and 12
INDEPENDENT AUDITOR’S REPORT – INVESTMENT COMPLIANCE ...... 13
SOUTH FLORIDA REGIONAL TRANSPORTATION AUTHORITY
SCHEDULE OF EXPENDITURES OF FEDERAL AWARDS AND STATE FINANCIAL ASSISTANCE FOR THE FISCAL YEAR ENDED JUNE 30, 2017
Federal Grantor/ Financial CFDA/ Passed Pass-Through Grantor Management CSFA Expenditures Through to Program Title Number Number Federal State Total Subrecipients Federal Transit Administration Assistance Formula-Section 9 Grants: Planning and Preventive Maintenance FL-54-0008 20.525$ 225,000 $ - $ 225,000 $ - FL-54-0012 20.525 853,460 - 853,460 - FL-57-041 20.521 252,608 - 252,608 - FL-57-050 20.521 421,847 - 421,847 421,847 FL-2017-066/FL-90-X942 20.507 9,939,463 - 9,939,463 - FL-05-096 20.500 22,630 - 22,630 - FL-90-690 20.507 1,634,499 - 1,634,499 - FL-90-764 20.507 2,000,000 - 2,000,000 - FL-90-809 20.507 152,795 - 152,795 - FL-90-845 20.507 2,028,907 - 2,028,907 - FL-90-861 20.507 1,924,276 - 1,924,276 - FL-90-872 20.507 5,173,615 - 5,173,615 - 24,629,100 - 24,629,100 421,847 Capital FL-88-0002 20.523 1,404,550 - 1,404,550 - FL-54-0008 20.525 136,984 - 136,984 - FL-54-0010 20.525 595,914 - 595,914 - FL-54-0012 20.525 907,843 - 907,843 - FL-2017-099/FL-54-0024 20.525 76,930 - 76,930 - FL-04-031 20.500 9,906 - 9,906 - FL-57-036 20.521 13,589 - 13,589 10,865 FL-57-041 20.521 292,314 - 292,314 22,534 FL-57-050 20.521 17,607 - 17,607 17,607 FL-95-055 20.507 1,328 - 1,328 - FL-95-056 20.507 213,839 - 213,839 - FL-2017-066/FL-90-X942 20.507 355,112 - 355,112 - FL-37-072 20.516 253,279 - 253,279 253,229 FL-95-074 20.507 43,177 - 43,177 - FL-37-082 20.516 288,787 - 288,787 288,787 FL-05-096 20.500 325,947 - 325,947 - FL-05-116 20.500 188,797 - 188,797 - FL-90-719 20.507 24,990 - 24,990 - FL-90-764 20.507 472,062 - 472,062 - FL-90-845 20.507 128,266 - 128,266 - FL-90-861 20.507 941,977 - 941,977 - FL-90-872 20.507 251,208 - 251,208 - 6,944,406 - 6,944,406 593,022 Total Federal Transit Administration$ 31,573,506 $ - $ 31,573,506 $ 1,014,869
1 SOUTH FLORIDA REGIONAL TRANSPORTATION AUTHORITY
SCHEDULE OF EXPENDITURES OF FEDERAL AWARDS AND STATE FINANCIAL ASSISTANCE FOR THE FISCAL YEAR ENDED JUNE 30, 2017
Federal Grantor/ Financial CFDA/ Passed Pass-Through Grantor Management CSFA Expenditures Through to Program Title Number Number Federal State Total Subrecipients
Federal Highway Administration Pass-through the Florida Department of Transportation - Operating: JPA # 5 42969318490 20.205$ 4,000,000 $ - $ 4,000,000 $ - Total Federal Highway Administration 4,000,000 - 4,000,000 - Florida Department of Transportation Pass-through the Florida Department of Transportation - Capital: Capital Grants: JPA # 74 42034419401 55.021 - 1,125,734 1,125,734 - JPA # 84 42762519401 55.011/55.014 - 11,400 11,400 - JPA # 85 42948712401 55.021 - 264,337 264,337 - JPA # 87 42139049404 55.017 - 2,432,288 2,432,288 - JPA # 92 43494819402 55.021 - 733,144 733,144 - JPA # 93 43351419402 55.021 - 650,233 650,233 - JPA # 94 40691919401 55.021 - 870,636 870,636 - JPA # 95 43745415701 55.013 - 3,030,742 3,030,742 - JPA # 96 43784815701 55.026 - 119,579 119,579 - JPA # 97 43785015701 N/A - 99,999 99,999 - JPA # 99 25023475701 N/A - 683,499 683,499 - JPA # 100 43029819401 55.013 - 674,528 674,528 - JPA # 103 43923115701 N/A - 50,844 50,844 - JPA # 104 43638119401 55.021 - 1,189,916 1,189,916 - JPA # 105 43045819401 N/A - 23,366 23,366 - Subtotal - 11,960,245 11,960,245 -
Total Florida Department of Transportation 4,000,000 11,960,245 15,960,245 -
Total$ 35,573,506 $ 11,960,245 $ 47,533,751 $ 1,014,869
See accompanying Notes to Schedule of Expenditures of Federal Awards and State Financial Assistance.
2 SOUTH FLORIDA REGIONAL TRANSPORTATION AUTHORITY
NOTES TO SCHEDULE OF EXPENDITURES OF FEDERAL AWARDS AND STATE FINANCIAL ASSISTANCE
NOTE 1. SIGNIFICANT ACCOUNTING POLICIES
Basis of Presentation
The Schedule of Expenditures of Federal Awards and State Financial Assistance is prepared using the accrual basis of accounting.
Measurement Focus
The determination of when an award is expended is based on when the activity related to the award occurred.
Program Type Determination
Type A programs are defined as federal programs with federal expenditures exceeding the larger of $750,000 or three percent of total federal expenditures. The threshold of $1,067,205 was used in distinguishing between Type A and Type B programs.
State major programs are defined as those programs that the larger of $300,000 or three percent of total state financial assistance. The threshold of $358,807 was used in distinguishing between Type A and Type B programs.
Method of Major Program Selection
The risk-based approach was used in the selection of federal and state programs to be tested as major programs. The Authority qualified as a low-risk auditee for the fiscal year ended June 30, 2017.
De-Minimis Indirect Cost Rate
During 2017, the Authority did not use the de-minimis indirect cost rate.
3 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
To the Governing Board of the South Florida Regional Transportation Authority Pompano Beach, Florida
We have audited, in accordance with the auditing standards generally accepted in the United States of America and the standards applicable to financial audits contained in Government Auditing Standards issued by the Comptroller General of the United States, the financial statements of the business-type activities of the South Florida Regional Transportation Authority (the “SFRTA”), a component unit of the Florida Department of Transportation, as of and for the year ended June 30, 2017, and the related notes to the financial statements, which collectively comprise the SFRTA’s basic financial statements, and have issued our report thereon dated December 27, 2017. The financial statements of the South Florida Regional Transportation Authority as of and for the year ended June 30, 2016, were audited by other auditors, whose report dated December 28, 2016 expressed an unmodified opinion on those statements.
Internal Control Over Financial Reporting In planning and performing our audit of the financial statements, we considered the SFRTA’s internal control over financial reporting (internal control) to determine the audit procedures that are appropriate in the circumstances for the purpose of expressing our opinions on the financial statements, but not for the purpose of expressing an opinion on the effectiveness of the SFRTA’s internal control. Accordingly, we do not express an opinion on the effectiveness of the SFRTA’s internal control.
A deficiency in internal control exists when the design or operation of a control does not allow management or employees, in the normal course of performing their assigned functions, to prevent, or detect and correct, misstatements on a timely basis. A material weakness is a deficiency, or a combination of deficiencies, in internal control such that there is a reasonable possibility that a material misstatement of the entity’s financial statements will not be prevented, or detected and corrected on a timely basis. A significant deficiency is a deficiency, or a combination of deficiencies, in internal control that is less severe than a material weakness, yet important enough to merit attention by those charged with governance.
Our consideration of internal control was for the limited purpose described in the first paragraph of this section and was not designed to identify all deficiencies in internal control that might be material weaknesses or, significant deficiencies. Given these limitations, during our audit we did not identify any deficiencies in internal control that we consider to be material weaknesses. However, material weaknesses may exist that have not been identified.
1401 MANATEE AVENUE WEST, SUITE 1200 • BRADENTON, FLORIDA 34205 • 941-747-4483 • FAX 941-747-6035 • www.mjcpa.com MEMBERS OF THE AMERICAN INSTITUTE OF CERTIFIED PUBLIC ACCOUNTANTS Compliance and Other Matters As part of obtaining reasonable assurance about whether the SFRTA’s financial statements are free of material misstatement, we performed tests of its compliance with certain provisions of laws, regulations, contracts, and grant agreements, noncompliance with which could have a direct and material effect on the determination of financial statement amounts. However, providing an opinion on compliance with those provisions was not an objective of our audit, and accordingly, we do not express such an opinion. The results of our tests disclosed no instances of noncompliance or other matters that are required to be reported under Government Auditing Standards.
Purpose of this Report The purpose of this report is solely to describe the scope of our testing of internal control and compliance and the results of that testing, and not to provide an opinion on the effectiveness of the entity’s internal control or on compliance. This report is an integral part of an audit performed in accordance with Government Auditing Standards in considering the entity’s internal control and compliance. Accordingly, this communication is not suitable for any other purpose.
Bradenton, Florida December 27, 2017
5 INDEPENDENT AUDITOR’S REPORT ON COMPLIANCE FOR EACH MAJOR FEDERAL PROGRAM AND STATE PROJECT AND ON INTERNAL CONTROL OVER COMPLIANCE REQUIRED BY THE UNIFORM GUIDANCE AND CHAPTER 10.550, RULES OF THE AUDITOR GENERAL
To the Governing Board of the South Florida Regional Transportation Authority Pompano Beach, Florida
Report on Compliance for Each Major Federal Program and State Project We have audited the South Florida Regional Transportation Authority’s (the “SFRTA”) compliance with the types of compliance requirements described in the OMB Compliance Supplement and the requirements described in the Department of Financial Services’ State Projects Compliance Supplement, that could have a direct and material effect on each of the SFRTA’s major federal programs and state projects for the year ended June 30, 2017. The SFRTA's major federal programs and state projects are identified in the summary of auditor’s results section of the accompanying schedule of findings and questioned costs.
Management’s Responsibility Management is responsible for compliance with federal and state statutes, regulations, and the terms and conditions of its federal and state awards applicable to its federal programs and state projects.
Auditor’s Responsibility Our responsibility is to express an opinion on compliance for each of the SFRTA’s major federal programs and state projects based on our audit of the types of compliance requirements referred to above. We conducted our audit of compliance in accordance with auditing standards generally accepted in the United States of America; the standards applicable to financial audits contained in Government Auditing Standards, issued by the Comptroller General of the United States; Title 2 U.S. Code of Federal Regulations Part 200, Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards (Uniform Guidance) and Chapter 10.550, Rules of the Auditor General. Those standards, the Uniform Guidance, and Chapter 10.550, Rules of the Auditor General require that we plan and perform the audit to obtain reasonable assurance about whether noncompliance with the types of compliance requirements referred to above that could have a direct and material effect on a major federal program or state project occurred. An audit includes examining, on a test basis, evidence about the SFRTA's compliance with those requirements and performing such other procedures as we considered necessary in the circumstances.
We believe that our audit provides a reasonable basis for our opinion on compliance for each major federal program and state project. However, our audit does not provide a legal determination of the SFRTA's compliance.
Opinion on Each Major Federal Program and State Project In our opinion, the SFRTA complied, in all material respects, with the types of compliance requirements referred to above that could have a direct and material effect on each of its major federal programs and state projects for the year ended June 30, 2017.
1401 MANATEE AVENUE WEST, SUITE 1200 • BRADENTON, FLORIDA 34205 • 941-747-4483 • FAX 941-747-6035 • www.mjcpa.com MEMBERS OF THE AMERICAN INSTITUTE OF CERTIFIED PUBLIC ACCOUNTANTS Report on Internal Control Over Compliance Management of the SFRTA is responsible for establishing and maintaining effective internal control over compliance with the types of compliance requirements referred to above. In planning and performing our audit of compliance, we considered the SFRTA’s internal control over compliance with the types of requirements that could have a direct and material effect on each major federal program and state project to determine the auditing procedures that are appropriate in the circumstances for the purpose of expressing our opinion on compliance for each major federal program and state project and to test and report on internal control over compliance in accordance with the Uniform Guidance and Chapter 10.550, Rules of the Auditor General, but not for the purpose of expressing an opinion on the effectiveness of internal control over compliance. Accordingly, we do not express an opinion on the effectiveness of the SFRTA’s internal control over compliance.
A deficiency in internal control over compliance exists when the design or operation of a control over compliance does not allow management or employees, in the normal course of performing their assigned functions, to prevent, or detect and correct, noncompliance with a type of compliance requirement of a federal program or state project on a timely basis. A material weakness in internal control over compliance is a deficiency, or combination of deficiencies, in internal control over compliance, such that there is a reasonable possibility that material noncompliance with a type of compliance requirement of a federal program or state project will not be prevented, or detected and corrected, on a timely basis. A significant deficiency in internal control over compliance is a deficiency, or a combination of deficiencies, in internal control over compliance with a type of compliance requirement of a federal program or state project that is less severe than a material weakness in internal control over compliance, yet important enough to merit attention by those charged with governance.
Our consideration of internal control over compliance was for the limited purpose described in the first paragraph of this section and was not designed to identify all deficiencies in internal control over compliance that might be material weaknesses or significant deficiencies. We did not identify any deficiencies in internal control over compliance that we consider to be material weaknesses. However, material weaknesses may exist that have not been identified.
Report on Schedule of Expenditures of Federal Awards and State Financial Assistance Required by the Uniform Guidance and Chapter 10.550, Rules of the Auditor General We have audited the financial statements of the business-type activities of SFRTA, as of and for the year ended June 30, 2017, and the related notes to the financial statements, which collectively comprise SFRTA’s basic financial statements. We issued our report thereon dated December 27, 2017, which contained unmodified opinions on those financial statements. Our audit was conducted for the purpose of forming opinions on the financial statements that collectively comprise the basic financial statements. The accompanying schedule of expenditures of federal awards and state financial assistance is presented for purposes of additional analysis as required by the Uniform Guidance and is not a required part of the basic financial statements. Such information is the responsibility of management and was derived from and relates directly to the underlying accounting and other records used to prepare the basic financial statements. The information has been subjected to the auditing procedures applied in the audit of the financial statements and certain additional procedures, including comparing and reconciling such information directly to the underlying accounting and other records used to prepare the basic financial statements or to the basic financial statements themselves, and other additional procedures in accordance with auditing standards generally accepted in the United States of America. In our opinion, the schedule of expenditures of federal awards and state financial assistance is fairly stated in all material respects in relation to the basic financial statements as a whole.
The purpose of this report on internal control over compliance is solely to describe the scope of our testing of internal control over compliance and the results of that testing based on the requirements of the Uniform Guidance and Chapter 10.550, Rules of the Auditor General. Accordingly, this report is not suitable for any other purpose.
Bradenton, Florida December 27, 2017 7 SOUTH FLORIDA REGIONAL TRANSPORTATION AUTHORITY
SCHEDULE OF FINDINGS AND QUESTIONED COSTS FOR THE YEAR ENDED JUNE 30, 2017
SECTION I SUMMARY OF AUDIT RESULTS Financial Statements Type of auditor’s report issued Unmodified
Internal control over financial reporting: Material weaknesses identified? ____ yes X no
Significant deficiencies identified not considered to be material weaknesses? ____ yes X none reported
Noncompliance material to financial statements noted? ____ yes X no
Federal Programs and State Financial Assistance Projects Internal Control over major federal or state programs: Material weaknesses identified? ____ yes X no
Significant deficiencies identified not considered to be material weaknesses? ____ yes X none reported
Type of auditor’s report issued on compliance for major Federal programs and state financial assistance projects: Unmodified
Any audit findings disclosed that are required to be reported in accordance with the Uniform Guidance? yes X no
Identification of major federal program:
CFDA Number Name of Federal Program or Cluster 20.500, 20.507, 20.526 and 20.527 U.S. Department of Transportation – Federal Transit Cluster 20.205 U.S. Department of Transportation – Highway Planning and Construction 20.523 U.S. Department of Transportation – Capital Assistance Program for Reducing Energy Consumption and Greenhouse Gas Emissions Identification of major state financial assistance projects:
CSFA Number Name of State Project or Cluster 55.017 New Starts Transit Program 55.021 Rail Passenger Service Development
8 SOUTH FLORIDA REGIONAL TRANSPORTATION AUTHORITY
SCHEDULE OF FINDINGS AND QUESTIONED COSTS FOR THE YEAR ENDED JUNE 30, 2017
SECTION I SUMMARY OF AUDIT RESULTS (CONTINUED)
Dollar threshold used to distinguish between Type A and Type B federal programs: $1,067,205
Auditee qualified as low-risk auditee? X yes no
SECTION II FINANCIAL STATEMENT FINDINGS AND RESPONSES
None reported.
SECTION III FEDERAL AWARDS FINDINGS AND QUESTIONED COSTS
None reported.
SECTION IV STATE PROJECTS FINDINGS AND QUESTIONED COSTS
None reported.
9 SOUTH FLORIDA REGIONAL TRANSPORTATION AUTHORITY
SCHEDULE OF PRIOR YEAR FINDINGS FOR THE YEAR ENDED JUNE 30, 2017
STATUS OF PRIOR YEAR AUDIT FINDINGS
No prior year audit findings.
10 INDEPENDENT AUDITOR'S MANAGEMENT LETTER
To the Governing Board of the South Florida Regional Transportation Authority Pompano Beach, Florida
Report on the Financial Statements We have audited the financial statements of the South Florida Regional Transportation Authority (the "SFRTA"), as of and for the fiscal year ended June 30, 2017, and have issued our report thereon dated December 27, 2017.
Auditor’s Responsibility We conducted our audit in accordance with auditing standards generally accepted in the United States of America; the standards applicable to financial audits contained in Government Auditing Standards, issued by the Comptroller General of the United States; the audit requirements of Title 2 U.S. Code of Federal Regulations Part 200, Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards (Uniform Guidance); and Chapter 10.550, Rules of the Auditor General.
Other Reports and Schedule We have issued our 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; Independent Auditor’s Report on Compliance for Each Major Federal Program and State Project and Report on Internal Control over Compliance; Schedule of Findings and Questioned Costs; and Independent Accountant’s Report on an examination conducted in accordance with AICPA Professional Standards, AT-C Section 315, regarding compliance requirements in accordance with Chapter 10.550, Rules of the Auditor General. Disclosures in those reports and schedule, which are dated December 7, 2017 should be considered in conjunction with this management letter.
Prior Audit Findings Section 10.554(1)(i)1., Rules of the Auditor General, requires that we determine whether or not corrective actions have been taken to address findings and recommendations made in the preceding annual financial audit report. There were no findings or recommendations in the preceding annual financial audit report requiring correction.
Official Title and Legal Authority Section 10.554(1)(i)4., Rules of the Auditor General, requires that the name or official title and legal authority for the primary government and each component unit of the reporting entity be disclosed in this management letter, unless disclosed in the notes to the financial statements. This information is disclosed in the notes to the financial statements.
1401 MANATEE AVENUE WEST, SUITE 1200 • BRADENTON, FLORIDA 34205 • 941-747-4483 • FAX 941-747-6035 • www.mjcpa.com MEMBERS OF THE AMERICAN INSTITUTE OF CERTIFIED PUBLIC ACCOUNTANTS Financial Condition and Management Section 10.554(1)(i)5.a. and 10.556(7), Rules of the Auditor General, requires us to apply appropriate procedures and communicate the results of our determination as to whether or not the SFRTA has met one or more of the conditions described in Section 218.503(1), Florida Statutes, and to identify the specific condition(s) met. In connection with our audit, we determined that the SFRTA did not meet any of the conditions described in Section 218.503(1), Florida Statutes.
Pursuant to Sections 10.554(1)(i)5.c. and 10.556(8), Rules of the Auditor General, we applied financial condition assessment procedures for the SFRTA. It is management’s responsibility to monitor the SFRTA’s financial condition, and our financial condition assessment was based in part on representations made by management and review of financial information provided by same.
Section 10.554(1)(i)2, Rules of the Auditor General, requires that we communicate any recommendations to improve financial management. In connection with our audit, we did not have any such recommendations.
Annual Financial Report Section 10.554(1)(i)5.b. and 10.556(7), Rules of the Auditor General, requires us to apply appropriate procedures and communicate the results of our determination as to whether the annual financial report for the SFRTA for the fiscal year ended June 30, 2017, filed with the Florida Department of Financial Services pursuant to Section 218.32(1)(a), Florida Statutes, is in agreement with the annual financial audit report for the fiscal year ended June 30, 2017. In connection with our audit, we determined that these two reports were in agreement.
Additional Matters Section 10.554(1)(i)3., Rules of the Auditor General, requires us to communicate noncompliance with provisions of contracts or grant agreements, or abuse, that have occurred, or are likely to have occurred, that have an effect on the financial statements that is less than material but which warrants the attention of those charged with governance. In connection with our audit, we did not note any such findings.
Purpose of this Letter Our management letter is intended solely for the information and use of the Legislative Auditing Committee, members of the Florida Senate and the Florida House of Representatives, the Florida Auditor General, Federal and other granting agencies, the Governing Board and applicable management, and is not intended to be and should not be used by anyone other than these specified parties.
Bradenton, Florida December 27, 2017
12 INDEPENDENT AUDITOR’S REPORT
To the Governing Board of the South Florida Regional Transportation Authority Pompano Beach, Florida
We have examined the South Florida Regional Transportation Authority’s (the “SFRTA”) compliance with Section 218.415, Florida Statutes, regarding the investment of public funds during the year ended June 30, 2017. Management is responsible for the SFRTA’s compliance with those requirements. Our responsibility is to express an opinion on the SFRTA’s compliance based on our examination.
Our examination was conducted in accordance with attestation standards established by the American Institute of Certified Public Accountants and, accordingly, included examining, on a test basis, evidence about the SFRTA’s compliance with those requirements and performing such other procedures as we considered necessary in the circumstances. We believe that our examination provides a reasonable basis for our opinion. Our examination does not provide a legal determination on the SFRTA’s compliance with specified requirements.
In our opinion, the SFRTA complied, in all material respects, with the aforementioned requirements for the year ended June 30, 2017.
This report is intended solely for the information and use of the SFRTA and the Auditor General, State of Florida, and is not intended to be and should not be used by anyone other than these specified parties.
Bradenton, Florida December 27, 2017
1401 MANATEE AVENUE WEST, SUITE 1200 • BRADENTON, FLORIDA 34205 • 941-747-4483 • FAX 941-747-6035 • www.mjcpa.com MEMBERS OF THE AMERICAN INSTITUTE OF CERTIFIED PUBLIC ACCOUNTANTS