CITY OF BRADENTON, FLORIDA Comprehensive Annual Financial Report For the Fiscal Year Ended September 30, 2017 TABLE OF CONTENTS Reference INTRODUCTORY SECTION Letter of Transmittal i Certificate of Achievement for Excellence in Financial Reporting v List of Principal City Officials vi Organization Chart vii FINANCIAL SECTION Independent Auditor's Report 1 Management's Discussion and Analysis 4 BASIC FINANCIAL STATEMENTS Government-wide Financial Statements Statement of Net Position 19 Statement of Activities 20 Fund Financial Statements Balance Sheet – Governmental Funds 21 Statement of Revenues, Expenditures and Changes in Fund Balances - Governmental Funds 23 Statement of Net Position – Proprietary Funds 25 Statement of Revenues, Expenses and Changes in Net Position - Proprietary Funds 27 Statement of Cash Flows – Proprietary Funds 28 Statement of Fiduciary Net Position – Fiduciary Funds 29 Statement of Changes in Fiduciary Net Position – Fiduciary Funds 30 Notes to the Financial Statements 31 Required Supplementary Information Schedules of Revenues, Expenditures and Changes in Fund Balance – Budget (GAAP Basis) And Actual – General Fund and Major Special Revenue Funds General Fund 90 State Housing Initiatives Partnership Program (SHIPP) Fund 91 Firefighters’ Pension Plan Schedule of Changes in the City’s Net Pension Liability and Related Ratios 93 Schedule of Employer Contributions 94 Police Officers’ Pension Plan Schedule of Changes in the City’s Net Pension Liability and Related Ratios 96 Schedule of Employer Contributions 97 Schedule of Investment Returns 97 Florida Retirement System – FRS Pension Plan Schedule of Changes in the City’s Proportionate Share of the Net Pension Liability and Schedule of Contributions 98 Florida Retirement System – Health Insurance Subsidy Schedule of Changes in the City’s Proportionate Share of the Net Pension Liability and Schedule of Contributions 99 Post-Employment Benefits Other Than Pension Schedule of Funding Progress and Schedule of Employer Contributions 100 COMBINING AND INDIVIDUAL FUND STATEMENTS AND SCHEDULES Schedule of Revenues and Expenditures – Budget and Actual – General Fund 102 Description of Nonmajor Governmental Funds Combining Balance Sheet 111 Combining Statement of Revenues, Expenditures and Changes in Fund Balances 117 Schedules of Revenues, Expenditures and Changes in Fund Balance Budget (GAAP Basis) and Actual – Special Revenue Funds Community Development Program Fund 123 Central Community Redevelopment Agency Fund 124 Bradenton Community Redevelopment Agency Fund 125 14th Street Community Redvelopment Agency Fund 126 Criminal Justice Education Fund 127 Twin Dolphin Marina Grant Fund 128 Police Explorers Fund 129 Police Federal Forfeiture Fund 130 State Forfeiture Fund 131 Abandoned Property Fund 132 Miscellaneous Grants Fund 133 Disaster Fund 134 Schedules of Revenues, Expenditures and Changes in Fund Balance Budget (GAAP Basis) and Actual – Debt Service Funds Franchise Fees Promissory Note 2000 Fund 135 Florida Municipal Loan 2012 Fund 136 Special Obligation Series 2012 Fund 137 Special Obligation Series 2016 Fund 138 Schedules of Revenues, Expenditures and Changes in Fund Balance Budget (GAAP Basis) and Actual – Capital Projects Funds Half Cent Infrastructure Surtax 139 Road Impact Fee Fund 140 Parks and Recreational Impact Fee – West Fund 141 Parks and Recreational Impact Fee – East Fund 142 Public Safety Police Protection Impact Fee Fund 143 Public Safety Fire Protection Impact Fee Fund 144 General Projects Fund 145 Pirate City Capital Reserve Fund 146 Description of Internal Service Funds Combining Statement of Net Position 148 Combining Statement of Revenues, Expenses and Changes in Net Position 149 Combining Statement of Cash Flows 150 Description of Fiduciary Funds Combining Statement of Fiduciary Net Position 152 Combining Statement of Changes in Fiduciary Net Position 153 STATISTICAL SECTION (UNAUDITED) Contents 154 Net Position by Component 155 Changes in Net Position 156 Fund Balances of Governmental Funds 158 Changes in Fund Balances of Governmental Funds 160 Governmental Activities Tax Revenues By Source 161 General Governmental Tax Revenues by Source 162 Assessed Value and Estimated Actual Value of Taxable Property 163 Property Tax Rates – Direct and Overlapping Governments 164 Principal Property Taxpayers 165 Property Tax Levies and Collections 166 Ratios of Outstanding Debt by Type 167 Ratios of General Bonded Debt Outstanding 168 Direct and Overlapping Governmental Activities Debt 169 Historical Non-Ad Valorem Revenues and Debt Service Payable from Non-Ad Valorem Revenues 170 Legal Debt Margin Information 171 Pledged-Revenue Coverage 172 Demographic and Economic Statistics 173 Principal Employers 174 Full-Time Equivalent City Government Employees by Function 175 Operating Indicators by Function 176 Capital Asset Statistics by Function 177 SINGLE AUDIT AND GRANTS COMPLIANCE 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 178 Independent Auditor’s Report on Compliance for Each Major State Project and Report on Internal Control Over Compliance Required by Chapter 10.550, Rules of the Auditor General 180 Schedule of Findings and Questioned Costs - State Projects 182 Schedule of Expenditures of State Financial Assistance 184 Independent Auditor’s Management Letter 185 Independent Accountant's Report on Investment Compliance 187 City of Bradenton, Florida Office of the City Clerk & Treasurer March 22, 2018 The Honorable Mayor, City Council, and Citizens of the City of Bradenton, Florida Dear Mayor, Council, and Citizens: I am proud to present the City of Bradenton Comprehensive Annual Financial Report (CAFR). This report addresses the City’s finances for the fiscal year ended September 30, 2017. The accuracy of the data, the completeness and fairness of the presentation and the disclosures are the responsibility of the City Clerk & Treasurer, the Chief Financial Officer of the City. The data presented is believed to be accurate in all material respects and is presented to fairly reflect the financial position of the City. All disclosures necessary for a comprehensive understanding of the City’s financial activity are included within this financial report. The City Clerk & Treasurer is responsible for establishing and maintaining internal controls to provide reasonable, but not absolute, assurance regarding the safeguarding of assets against loss from unauthorized use or disposition, along with the reliability of financial records for preparing financial statements and maintaining accountability of assets. These controls have been designed into the basic functions of the City's accounting system. The concept of reasonable assurance recognizes that the cost of a control should not exceed the benefits likely to be derived, and the evaluation of costs and benefits requires estimates and judgments by management. All internal control evaluations occur within this framework. We believe that the City’s internal accounting controls adequately safeguard assets and provide reasonable assurance of proper recording of financial transactions. During the summer of 2017 the City of Bradenton, through bid process, selected a new external audit firm. Christopher, Smith, Leonard, Bristow and Stanell (CS&L) CPA's went right to work in order for the City to meet the requirements of Chapter 11.45 of the Florida Statutes (requiring all Florida municipalities undergo an independent Certified Public Accountant's financial audit). This requirement has been met for the fiscal year ended September 30, 2017 and the report of the City's new independent auditing firm has been included in this document. In addition to meeting the requirements set forth in state statutes, the audit was also designed to meet the requirements of the Florida Single Audit Act. The independent auditor's report on the basic financial statements and combining and individual fund statements and schedules, and the single audit are included in the Financial Section of this report. The City of Bradenton operates under a charter adopted on May 19, 1903. The City Council is the legislative body for the City of Bradenton and is made up of five residents elected by the City voters. Each council person lives in and represents an individual ward, but all are elected “at large.” In addition to the City Council, the voters elect a mayor that serves as the Chief Elected Official. As of September 30, 2017 the City's elected officials are: Mayor: Wayne Poston Term to Expire: 2020 Ward 1: Gene Gallo Term to Expire: 2020 Ward 2: Gene Brown Term to Expire: 2018 Ward 3: Patrick Roff Term to Expire: 2018 Ward 4: Bemis Smith Term to Expire: 2018 Ward 5: Harold Byrd, Jr. Term to Expire: 2020 Governmental accounting and auditing principles require that management provides a narrative introduction, overview and analysis of 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 of Bradenton’s MD&A begins on page 4, immediately following the Independent Auditor’s Report. City Organization. The City of Bradenton is centrally located on the west (Gulf) coast of Florida, approximately forty miles south of Tampa. Bradenton encompasses 14.55 square miles and has a population of 54,652. The City of Bradenton provides a full