Slc Cafr 06.30.2017

SALT LAKE CITY CORPORATION SALT LAKE CITY, UTAH COMPREHENSIVE ANNUAL FINANCIAL REPORT FOR THE YEAR ENDED JUNE 30, 2017 With INDEPENDENT AUDITOR’S REPORT Prepared by Department of Finance Mary Beth Thompson, Chief Financial Officer i TABLE OF CONTENTS Pages INTRODUCTORY SECTION: Title Page i Table of Contents ii Transmittal Letter v Organizational Structure xi Certificate of Achievement xii FINANCIAL SECTION: Independent Auditor’s Report 2 Management’s Discussion and Analysis 4 Basic Financial Statements Government-wide Financial Statements Statement of Net Position 16 Statement of Activities 18 Governmental Fund Financial Statements Balance Sheet 21 Reconciliation of the Governmental Funds Balance Sheet to the Statement of Net Position 22 Statement of Revenues, Expenditures, and Changes in Fund Balances 23 Reconciliation of the Statement of Revenues, Expenditures, and Changes in Fund Balances to the Statement of Activities 24 Proprietary Fund Financial Statements Statement of Net Position 26 Reconciliation of Proprietary Fund Statement of Net Position to the Primary Government Business-type Statement of Net Position 30 Statement of Revenues, Expenses, and Changes in Fund Net Position 32 Reconciliation of Proprietary Fund changes in Net Position to the Primary Government Business-type Changes in Net Position 34 Statement of Cash Flows 36 Fiduciary Fund Financial Statements Statement of Fiduciary Net Position 39 Statement of Changes in Fiduciary Net Position 40 Notes to the Financial Statements 42 Note 1. Summary of Significant Accounting Policies 43 Note 2. Cash, Cash Equivalents and Investments 52 Note 3. Loans Receivable 56 Note 4. Restricted Assets 56 Note 5. Capital Assets 58 Note 6. Long-term Obligations 60 Note 7. Fund Equity 68 Note 8. Deficit Fund Balances/Net Position, Expenditures and Other Uses That Exceed Appropriations in Individual Funds 69 Note 9. General Fund Interfund Service Charges 70 Note 10. Transfers 70 Note 11. Risk Management 71 Note 12. Pension Plans 72 Note 13. Deferred Compensation Plans 81 Note 14. Commitments and Contingencies 82 Note 15. Related Party Transactions 84 ii TABLE OF CONTENTS Pages Note 16. Joint Venture 85 Note 17. Recent Accounting Pronouncements 86 Note 18. Subsequent Events 86 Required Supplementary Information Budgetary Comparison Schedule – General Fund 88 Schedule of Funding Progress-Retiree Healthcare and Life Insurance Plan 89 Schedule of the Proportionate Share of the Net Pension Liability 90 Schedule of Contributions 93 Notes to Required Supplementary Information Budgetary – GAAP Reporting Reconciliation 99 Pensions - Changes in Assumptions 100 Supplementary Information – Combining Statements and Individual Fund Statements and Schedules Governmental Funds Nonmajor Governmental Funds Combining Balance Sheet SI-3 Combining Statement of Revenues, Expenditures and Changes in Fund Balance SI-4 Combining Balance Sheet – Nonmajor Special Revenue Funds SI-5 Combining Statement of Revenues, Expenditures and Changes in Fund Balance – Nonmajor Special Revenue Funds SI-7 Budgetary Comparison Schedules Arts Council SI-9 Downtown Economic Development SI-10 Community Development Operating Fund SI-11 Grants Operating Fund SI-12 Street Lighting SI-13 Demolition, Weed and Forfeiture SI-14 Emergency 911 Dispatch SI-15 Salt Lake City Donation Fund SI-16 Combining Balance Sheet – Nonmajor Debt Service Funds SI-17 Combining Statement of Revenues, Expenditures and Changes in Fund Balance SI-18 Budgetary Comparison Schedules Special Improvement Fund SI-19 Major Governmental Funds Budgetary Comparison Schedules Capital Projects Fund SI-21 Other Improvement Fund SI-22 Enterprise Funds Nonmajor Proprietary Funds Combining Statement of Net Position SI-25 Combining Statement of Revenues, Expenses and Changes in Fund Net Position SI-29 Combining Statement of Cash Flows SI-31 Budgetary Comparison Schedules Street Lighting SI-33 Refuse Collection Fund SI-34 Housing Fund SI-35 Golf Fund SI-36 Major Proprietary Funds Budgetary Comparison Schedules iii TABLE OF CONTENTS Pages Supplementary Information – Combining Statements and Individual Fund Statements And Schedules (continued) Department of Airports SI-38 Water Utility Fund SI-39 Sewer Utility Fund SI-40 Stormwater Utility Fund SI-41 Redevelopment Agency Fund SI-42 Internal Service Funds Combining Statement of Net Position SI-45 Combining Statement of Revenues, Expenses and Changes in Fund Net Position SI-47 Combining Statement of Cash Flows SI-49 Budgetary Comparison Schedules Fleet Management Fund SI-51 Information Management Services Fund SI-52 Risk Management Fund SI-53 Governmental Immunity Fund SI-54 Local Building Authority Fund SI-55 STATISTICAL SECTION: (unaudited) Net Position by component – Last Ten Fiscal Years S-1 Change in Net Position – Last Ten Fiscal Years S-2 Fund Balance of Governmental Funds – Last Ten Years S-4 Changes in Fund Balances of Governmental Funds – Last Ten Years S-6 Governmental Activities Tax Revenues by Source – Last Ten Fiscal Years S-8 Assessed and Estimated Actual Value of Taxable Property – Last Ten Fiscal Years S-9 Direct and Overlapping Property Tax Rates S-10 Principal Property Tax Payers S-11 Property Tax Levies and Collections – Last Ten Years S-12 Ratios of Outstanding Debt by Type S-13 Ratios of General Bonded Debt Outstanding – Last Ten Fiscal Years S-14 Computation of Direct and Overlapping Bonded Debt S-15 Legal Debt Margin Information – Last Ten Fiscal Years S-16 Pledged-Revenue Coverage – Last Ten Fiscal Years S-17 Demographic and Economic Statistics S-18 Full-time Equivalent City Government by Functions – Last Ten Fiscal Years S-19 Principal Employers S-20 Operating Indicators by Function S-21 Capital Asset Statistics by Function S-22 iv DEPARTMENT OF FINANCE January 10, 2018 The Honorable Mayor and Members of the City Council Salt Lake City Corporation Overview The Comprehensive Annual Financial Report of Salt Lake City Corporation (“the City”) for the fiscal year ended June 30, 2017, is submitted herewith. These financial statements have been prepared by the Salt Lake City Department of Finance in accordance with Generally Accepted Accounting Principles (GAAP) for local governments as prescribed by the Governmental Accounting Standards Board (GASB). The accuracy of the presented data and the completeness and fairness of the presentations, including all disclosures, are the responsibility of the management of the City. We believe the data, as presented, is accurate in all material respects and is presented in a manner that fairly sets forth the following aspects of the City: (1) the financial position of the governmental activities; (2) the business- type activities; (3) the discretely presented component unit; (4) each major fund; (5) the aggregate remaining fund information; (6) the respective changes in financial position and (7) applicable cash flows. In order to provide a reasonable basis for making these representations, the management of Salt Lake City has established a comprehensive internal control framework that is designed both to protect the government’s assets from loss, theft, or misuse and to compile sufficient reliable information for the preparation of the Salt Lake City Corporation’s financial statements in conformity with GAAP. Because the cost of internal controls should not outweigh their benefits, Salt Lake City Corporation’s comprehensive framework of internal controls has been designed to provide reasonable, rather than absolute assurance that the financial statements will be free from material misstatement. As management, we assert that to the best of our knowledge and belief, this report is complete and reliable in all material respects. Eide Bailly, LLP an independent firm of Certified Public Accountants, has audited these basic financial statements and related notes. Their report is included herein. The goal of the independent audit is to provide reasonable assurance that the financial statements of Salt Lake City Corporation for the fiscal year ended June 30, 2017 are free of material misstatements. This independent audit involved examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements, assessing the accounting principles used, and significant estimates made by management. Additionally, Eide Bailly, LLP audited the compliance requirements of the City’s federal grant programs for the year ended June 30, 2017 as part of the federally mandated “Single Audit” designed to meet the special needs of federal grantor agencies. That report is available under a separate cover. LOCATION: 451 SOUTH STATE STREET, ROOM 248, SALT LAKE CITY, UTAH 84111-3102 MAILING ADDRESS: PO BOX 145452, SALT LAKE CITY, UTAH 84114-5452 TELEPHONE: 801-535-7676 FAX: 801-535-7682 GAAP requires that management provide a narrative introduction, overview, and analysis to accompany the basic financial statements in the form of Management’s Discussion and Analysis (MD&A) . This letter of transmittal is designed to complement the MD&A and should be read in conjunction with it. The City’s MD&A can be found immediately following the report of the independent auditors. PROFILE OF SALT LAKE CITY Salt Lake City lies between the Wasatch Mountains and the Great Salt Lake at an altitude of 4,200 feet. Permanent settlement of the City began on July 24, 1847, when Brigham Young with a party of 148 Mormon pioneers entered the Salt Lake Valley after a 1,500-mile trek westward. Salt Lake City was incorporated on January 6, 1851 and soon became a major center for trade and commerce

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