KS Comprehensive Annual Financial Report For Year Ending December 31st, 2013 TOPEKA, OF CITY COMPREHENSIVE ANNUAL FINANCIAL REPORT CITY OF TOPEKA, KANSAS For The Year Ending December 31, 2013 Prepared by the Administrative and Financial Services Department This page intentionally left blank. CITY OF TOPEKA, KANSAS Comprehensive Annual Financial Report For the year ending December 31, 2013 TABLE OF CONTENTS Page INTRODUCTORY SECTION Letter of Transmittal i - viii City Organizational Chart ix List of Principal Officials x FINANCIAL SECTION Independent Auditor’s Report 1 - 2 Management’s Discussion and Analysis 3 - 15 Basic Financial Statements: Government-wide Financial Statements Statement of Net Position 16 Statement of Activities 17 Fund Financial Statements Balance Sheet - Governmental Funds 18 Reconciliation of the Total Governmental Fund Balance to Net Position of Governmental Activities 19 Statement of Revenues, Expenditures, and Changes in Fund Balance - Governmental Funds 20 Reconciliation of the Governmental Funds Statement of Revenues, Expenditures and Changes in Fund Balance with the Government-Wide Statement of Activities 21 Statement of Revenues, Expenditures, and Changes in Fund Balances – Budget and Actual General Fund 22 Special Street Repairs Fund 23 Sales Tax – Street Repairs Fund 24 Statement of Net Position - Proprietary Funds 25 Statement of Revenues, Expenses, and Changes in Net Position - Proprietary Funds 26 Statement of Cash Flows - Proprietary Funds 27 - 28 Statement of Assets and Liabilities - Agency Funds 29 Notes to the Basic Financial Statements 30 - 59 CITY OF TOPEKA, KANSAS Comprehensive Annual Financial Report For the year ending December 31, 2013 TABLE OF CONTENTS - CONTINUED Page Required Supplementary Information Schedule of Funding Progress – for the Retirees Health Plan 60 Combining Statements and Individual Fund Schedules Combining Statements - Nonmajor Governmental Funds Fund Descriptions 61 - 62 Combining Balance Sheet - Nonmajor Governmental Funds 63 - 66 Combining Statement of Revenues, Expenditures and Changes in Fund Balances - Nonmajor Governmental Funds 67 - 70 Individual Fund Schedules of Revenues, Expenditures and Changes in Fund Balance - Budget and Actual (Non-GAAP Basis): Downtown Improvement District Fund 71 Court Technology Fund 72 Special Alcohol Program Fund 73 Alcohol and Drug Safety Fund 74 Park Land Acquisition Fund 75 Law Enforcement Fund 76 Special Liability Expense Fund 77 Transient Guest Tax Fund 78 Employee Separation Fund 79 Retirement Reserve Fund 80 KP&F Equalization Fund 81 Neighborhood Revitalization Fund 82 Historic Asset Tourism Fund 83 ½% Sales Tax Fund 84 Tax Increment Financing Fund 85 Debt Service Fund 86 Internal Service Fund Descriptions 87 Combining Statement of Net Position - Internal Service Funds 88 Combining Statement of Revenues, Expenses, and Changes in Net Position - Internal Service Funds 89 Combining Statement of Cash Flows - Internal Service Funds 90 - 91 Combining Statement of Net Position – Risk Management Funds 92 Combining Statement of Revenues, Expenses and Changes in Net Position – Risk Management Funds 93 Combining Statement of Cash Flows – Risk Management Funds 94 - 95 Fiduciary Fund Descriptions - Agency Funds 96 Combining Balance Sheet - Agency Funds 97 CITY OF TOPEKA, KANSAS Comprehensive Annual Financial Report For the year ending December 31, 2013 TABLE OF CONTENTS - CONTINUED Page STATISTICAL SECTION Net Position by Component - Last Ten Years 98 Changes in Net Position - Last Ten Years 99 - 100 Fund Balances, Governmental Funds - Last Ten Years 101 Changes in Fund Balances, Governmental Funds - Last Ten Years 102 Tax Revenues by Source, Governmental Funds - Last Ten Years 103 Local Sales Tax Revenues – Last Ten Years 104 Local Sales Taxable Collections by Category – Last Ten Years 105 Direct and Overlapping Sales Tax Rates – Last Ten Years 106 Assessed Value and Estimated Actual Value of Taxable Property – Last Ten Years 107 Property Tax Levies and Collections – Last Ten Years 107 Principal Property Taxpayers – Current Year and Nine Years Ago 108 Direct and Overlapping Property Tax Rates – Last Ten Years 109 Direct and Overlapping Governmental Activities Debt 110 Ratios of Outstanding Debt by Type – Last Ten Years 111 Ratios of General Bonded Debt Outstanding – Last Ten Years 112 Legal Debt Margin Information – Last Ten Years 113 Pledged-Revenue Coverage – Last Ten Years 114 Demographic and Economic Statistics – Last Ten Years 115 Property Value, Construction, and Bank Deposits – Last Ten Years 115 Principal Employers – Current Year and Nine Years Ago 116 Full-time Equivalent City Government Employees by Function/Program – Last Ten Years 117 Operating Indicators by Function/Program – Last Ten Years 118 Capital Asset Statistics by Function/Program – Last Ten Years 119 CITY OF TOPEKA, KANSAS Comprehensive Annual Financial Report For the year ending December 31, 2013 TABLE OF CONTENTS - CONTINUED Page STATISTICAL SECTION – OTHER INFORMATION Sales Tax Revenue Bonds, Series 2006/Refunding 2011 120 Schedule of Bonded Indebtedness and Other Financing by Issue 121 Schedule of Temporary Notes Outstanding by Project 122 Debt Service Payments to Final Maturity 123 Schedule of Industrial Revenue Bonds by Obligee 124 Schedule of Special Assessment Debt 125 Employment and Unemployment Statistics 126 Capital Improvement Program 127 GOVERNMENTAL AUDIT SECTION Schedule of Expenditures of Federal Awards 128 - 129 Notes to the Schedule of Expenditures of Federal Awards 130 Schedule of Findings and Questioned Costs 131 - 136 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” 137 - 138 Independent Auditor’s Report on Compliance for Each Major Program and on Internal Control over Compliance required by OMB Circular A-133 139 - 140 INTRODUCTION AUDIT SECTION This page intentionally left blank. City of Topeka Jim Colson, City Manager Administrative and Financial Services Department Doug Gerber, Director CENTRAL ACCOUNTING DIVISION E-mail:[email protected] 215 SE 7th Street, Room 358 Telephone: 785-368-3970 Topeka, KS 66603-3914 Fax: 785-368-3975 Website: http://www.topeka.org July 21, 2014 Honorable Mayor Larry Wolgast Honorable Members of the City Council City of Topeka Topeka, Kansas Ladies and Gentlemen: I am pleased to present the Comprehensive Annual Financial Report (CAFR) of the City of Topeka, Kansas (the City) for the fiscal year ended December 31, 2013. The CAFR has been prepared by the Administrative and Financial Services Department in conformance with the principles and standards for financial reporting set forth by the Governmental Accounting Standards Board (GASB). Responsibility for both the accuracy of the data and the completeness and fairness of the presentation, including all disclosures, rests with the City. I believe that the data, as presented, is accurate in all material respects; that its presentation fairly shows the financial position and the results of the City’s operations as measured by the financial activity of its various funds; and that the included disclosures will provide the reader with an understanding of the City’s financial affairs. Mize Houser and Company P.A., an independent firm of licensed certified public accountants, audited the City’s financial statements and issued an unmodified opinion on the governmental and business-type activities of the City of Topeka’s financial statements for the year ended December 31, 2013. GASB Statement No. 34 requires that management provide a narrative introduction, overview, and analysis to accompany the Basic Financial Statements in the form of a Management’s Discussion & Analysis (MD&A). This letter of transmittal is designed to complement the MD&A and should be read in conjunction with it. The MD&A can be found immediately following the report of the independent auditors. Our CAFR is divided into the following sections: The Introductory Section includes information about the organizational structure of the City, the City’s economy, major initiatives, status of City services, and cash management. The Financial Section is prepared in accordance with the GASB 34 requirements by including the MD&A, the Basic Financial Statements including notes and the Required Supplementary Information. The Basic Financial Statements include the government-wide financial statements that i present an overview of the City’s entire financial operations and the fund financial statements that present the financial information of each of the City’s major funds, as well as non-major governmental, fiduciary and other funds. Also included in this section is the Independent Auditors’ Report on the basic financial statements. The Statistical Section includes tables containing historical financial data, debt statistics, and miscellaneous social and economic data of the City that are of interest to potential investors in our bonds and to other readers. The data includes ten–year revenue and expenditure information on an inflation- adjusted basis. PROFILE OF TOPEKA Topeka is the capital city of Kansas and the seat of Shawnee County. It is situated along the Kansas River in northeast Kansas. As of the 2010 census, the city population was 127,473 and has shown a modest population growth of 2.1 percent since 2000. The Topeka Metropolitan Statistical Area had a 2010 population of 233,870. Topeka is also the county seat of Shawnee County, Kansas