Comprehensive Annual Financial Report - June 30, 2008City of
MONROE
North Carolina
n heritage of progress
Comprehensive Annual Financial Report
For the fiscal year ended June 30, 2008
City of Monroe, North Carolina
Comprehensive Annual Financial Report
For The Fiscal Year Ended June 30, 2008
Prepared By
Department of Finance and Administration
Director of Finance and Administration
James R. Fatland
Accounting Manager
Lisa Strickland
Budget Analyst
Mary Lou Clark
CITY OF MONROE, NORTH CAROLINA
TABLE OF CONTENTS
June 30, 2008
INTRODUCTORY SECTION: Page
Letterof Transmittal ......................................................................... ............................... vii - xi
GFOA Certificate of Achievement for Excellence in Financial Reporting .............. xii
List of Principal Officials ..................................................... ............................... xiii
OrganizationalChart ....................................................................... ............................... xiv
FINANCIAL SECTION:
Independent A uditors'Report ........................................................... ............................... 1-2
Management's Discussion and Analysis ............................................ ............................... 3 -10
Exhibit Page
Basic Financial Statements:
Government -wide Financial Statements:
Statement of Net Assets ............................................................ ............................... 1 13
Statement of Activities .............................................................. ...............................
2
14-15
Fund Financial Statements:
Balance Sheet - Governmental Funds ........................................ ...............................
3
16
Reconciliation of the Governmental Funds Balance Sheet to the
Statement of Net Assets ..................................................... ...............................
4
17
Statement of Revenues, Expenditures, and Changes
In Fund Balances — Governmental Funds ..... ....................... ...............................
5
18
Reconciliation of the Statement of Revenues, Expenditures,
and Changes in Fund Balances of Governmental Funds to the
Statement of Activities .......................................................... ...............................
6
19
Statement of Revenues, Expenditures, and Changes in
Fund Balances - Budget and Actual - General Fund ............... ...............................
7
21
Statement of Net Assets - Proprietary Funds ............................... ...............................
8
22-23
Statement of Revenues, Expenses, and Changes
in Fund Net Assets - Proprietary Funds ................................. ...............................
9
24-25
Statement of Cash Flows - Proprietary Funds ............................. ...............................
10
26-29
Notes to the Financial Statements ................................................... ...............................
30-57
Required Supplemental Financial Data:
Law Enforcement Officers' Special Separation Allowance
Schedule of Funding Progress ................................................... ...............................
58
Law Enforcement Officers' Special Separation Allowance
Schedule of Employer Contributions ...................................... ...............................
59
I
CITY OF MONROE, NORTH CAROLINA
TABLE OF CONTENTS
June 30, 2008
Other Supplemental Information:
Combining and Individual Fund Statements and Schedules:
Nonmajor Governmental Funds
Page
Combining Balance Sheet ........................................................ ...............................
62-63
Combining Statement of Revenues, Expenditures, and
Changes in Fund Balances ................................................... ...............................
64-65
Governmental Funds Budgetary Schedules:
Schedule of Revenues, Expenditures, and Changes
in Fund Balances - Budget and Actual - General Fund .......... ...............................
66-69
Schedule of Revenues, Expenditures, and Changes
in Fund Balances - Budget and Actual - Special Revenue Funds ..........................
70-74
Schedule of Revenues, Expenditures, and Changes
in Fund Balances - Budget and Actual - Capital Projects Funds ...........................
75
Enterprise Funds Budgetary Schedules:
Schedule of Revenues and Expenditures -
Budget and Actual - (NON- GAAP):
Waterand Sewer Fund ..................................................... ...............................
76-78
Water and Sewer Capital Projects Funds ........................... ...............................
79-80
ElectricFund .................................................................... ...............................
81-83
Electric Capital Projects Funds .......................................... ............................... 84
NaturalGas Fund .............................................................. ............................... 85-87
Natural Gas Capital Projects Funds ................................... ............................... 88
Aquatics and Fitness Center Fund ...................................... ............................... 89-91
Aquatics and Fitness Center Capital Projects Funds ........... ............................... 92
AirportFund ..................................................................... ............................... 93 -95
Airport Capital Projects Funds ........................................... ............................... 96-97
11
CITY OF MONROE, NORTH CAROLINA
TABLE OF CONTENTS
June 30, 2008
Other Schedules Page
Schedule of Ad Valorem Taxes Receivable ............................... ............................... 98
Analysis of Current Tax Levy - Citywide Levy ......................... ............................... 99
Table Page
STATISTICAL SECTION:
Financial Trends
NetAssets by Component .............................................................. ............................... 1 103
Changes in Net Assets ................................................................... ............................... 2 104- 105
Fund Balances, Governmental Funds .............................................. ............................... 3 106
Changes in Fund Balances, Governmental Funds ........................... ............................... 4 107
Revenue Capacity
Assessed Value and Actual Value of Taxable Property ................... ............................... 5 108
Direct and Overlapping Property Tax Rates ................................... ............................... 6 109
Principal Property Taxpayers ........................................................ ............................... 7 110
Property Tax Levies and Collections .............................................. ............................... 8 111
Debt Capacity
Ratios of Outstanding Debt by Type .............................................. ...............................
9
112
Ratios of General Bonded Debt Outstanding ................................. ...............................
10
113
Direct and Overlapping Governmental Activities Debt .................. ...............................
11
114
Legal Debt Margin Information .................................................... ...............................
12
115
Pledged- Revenue Coverage ........................................................... ...............................
13
116
Demographic and Economic Information:
Demographic and Economic Statistics ............................................ ...............................
14
117
PrincipalEmployers ..................................................................... ...............................
15
118
Operation Information:
Full-Time Equivalent City Governmental Employees by Function . ...............................
16
119
Operating Indicators by Function ................................................... ...............................
17
120
Capital Asset Statistics by Function ............................................... ...............................
18
121
COMPLIANCE SECTION:
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 ............... ........... ..................... 123 -124
Report on Compliance with Requirements Applicable to Each
Major Federal Program and Internal Control Over Compliance In
Accordance with OMB Circular A -133 and the State Single Audit
Implementation Act ....................................................................... ............................... 125- 126
Report on Compliance with Requirements Applicable to Each
Major State Program and Internal Control Over Compliance In
Accordance with Applicable Sections of OMB Circular A -133 and
the State Single Audit Implementation Act ..................................... ............................... 127-128
iii
CITY OF MONROE, NORTH CAROLINA
TABLE OF CONTENTS
June 30, 2008
Page
Schedule of Findings and Questioned Costs ................................... ............................... 129-130
Summary Schedule of Prior Year Audit Findings .......................... ............................... 131
Schedule of Expenditures of Federal and State Awards .................. ............................... 132 - 133
1V
INTRODUCTORY SECTION
Introductory Section
• Letter of Transmittal
• Certificate of Achievement for Excellence in Financial Planning
• List of Principal Officials
• Organizational Chart
CITY OF MONROE
P.O. BOX 69 - MONROE, NC 28111 -0069
PHONE 704 - 282 -4500
FAX 704 - 283 -9098
November 6, 2008
To the Honorable Mayor Bobby Kilgore, Members of the City Council,
and Citizens of the City of Monroe:
We are pleased to present to you the Comprehensive Annual Financial Report ( "CAFR ") of the City of
Monroe for the fiscal year ended June 30, 2008. North Carolina law requires that all general- purpose local
governments publish within four months of the close of each fiscal year a complete set of financial
statements presented in conformity with generally accepted accounting principles ( "GAAP ") and audited in
accordance with generally accepted auditing standards by a firm of licensed certified public accountants.
The independent certified public accounting firm of Potter & Company, P.A., has audited the financial
statements and supplemental schedules contained herein, and issued an unqualified ( "clean") opinion on the
City of Monroe's financial statements for the year ended June 30, 2008. The independent auditor's report
is presented as the first component of the Financial Section of this report.
Responsibility for both the accuracy of the data and the completeness and fairness of the presentation,
including all disclosures, rests with the City. To the best of our knowledge and belief, the enclosed
information is accurate in all material respects and is reported in a manner designed to present fairly the
financial position and results of operations of the various funds of the City. All disclosures necessary to
enable the reader to gain an understanding of the City's financial activities have been included.
The goal of the annual independent audit is to provide reasonable assurance that the financial statements of
the City for the fiscal year are free from material misstatement. The 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; and evaluation of the overall
financial statement presentation.
The independent audit of the financial statements of the City was part of a broader, federally mandated
"Single Audit" designed to meet the special needs of federal grantor agencies. The standards governing
Single Audit engagements require the independent auditor to report not only on the fair presentation of the
financial statements, but also on the audited government's internal controls and compliance with legal
requirements, with special emphasis on internal controls and legal requirements involving the
administration of federal awards. These reports are available in the City of Monroe's CAFR.
Generally accepted accounting principles require 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.
vii
The Reporting Entity and Services Provided
For financial reporting purposes, in accordance with the criteria in Governmental Accounting Standards
Board ( "GASB ") Statement No. 14, the City of Monroe includes all funds, agencies, boards, commissions
and authorities that are controlled by or are financially dependent upon the City. Control by or financial
dependence was determined on the basis of obligation of the City to finance deficits, guarantee debt, select
the governing authority, approve the budget, have authority to make a public levy, and to have ownership
of assets. As a result of implementing GASB Statement No. 14, the City of Monroe has included the City
of Monroe ABC Board and the Monroe Tourism Development Authority as discretely presented
component units. Additional information on these legally separate reporting entities can be found in the
Notes to the Financial Statements.
The City provides numerous services for its citizens including airport operations, cultural and recreational
activities, general administration, planning, zoning, economic development, building inspections, code
enforcement, police, fire, sanitation, cemetery management, tourism, public works, and street maintenance.
The City also provides and maintains electric, natural gas, water, and sanitary sewer utilities for the benefit
of its citizens and businesses. This report includes the fiscal activities of the City in the provision of these
services.
The City also provides financial support to certain boards, agencies and commissions to assist their efforts
in serving our citizens. Organizations that receive support from the City include the American Red Cross,
HealthQuest, Monroe High School Athletic Foundation, Downtown Monroe, Inc., Community Health
Services of Union County, Union County Crisis Assistance Ministry, Union County Habitat for Humanity,
Union County Community Arts Council, Council on Aging in Union County, the Monroe -Union County
Community Development Corporation, the Union County Historic Preservation Commission, Turning
Point, Union County Community Action, Inc., the Literacy Council of Union County, the Union County
Community Shelter, the Union County Partnership for Children, and the Union County JobReady
Partnership Council, Inc.
Organization of Government
The City of Monroe was established in 1844, and is located near the center of Union County in the southern
Piedmont region of North Carolina. The City is a diverse community of nearly 34,000 residents, and has an
incorporated area of over 29 square miles. Monroe serves as the County seat for Union County, and is the
County's largest municipality. Monroe's corporate limits are approximately seven miles southeast of
Charlotte, and the City has experienced tremendous growth due to its proximity to the fastest growing
region of Charlotte and Mecklenburg County. The City has the statutory authority to extend its corporate
limits through voluntary and involuntary annexation when deemed appropriate by the City Council.
The City is organized under a Council- Manager form of government, with a six - member City Council and
Mayor serving as the governing body, and who are responsible for policy - making and establishing
legislative authority. Council members are elected on a non - partisan basis to staggered four -year terms.
The Mayor is elected to serve a two -year term, and is a full voting member on the City Council.
The City Council is responsible for passing ordinances, adopting the annual budget, appointing committees,
and hiring the City Manager, City Attorney, and City Clerk. The City Manager is responsible for carrying
out the policies and ordinances of the City Council, for overseeing the daily operations of the government,
and for selecting the department heads to manage the various City departments.
The City takes pride in the services offered to our citizens, and the mission of City staff is to provide
reliable, responsive, quality service to our customers at the lowest reasonable cost. We accomplish this
through professional and courteous service consistent with making Monroe a vibrant and progressive
community. City staff strives to be proactive in addressing the various needs of the community, and
adheres to the guiding principles of Teamwork, Customer Service, Respect, and Accountability.
Economic Condition and Outlook
In spite of global and national challenges, the City has continued to experience a favorable economic
climate over the last fiscal year. Our existing industries have announced investments in manufacturing
equipment and facility expansions totaling more than $100 million. Monroe's workforce is diversified,
consisting of industrial, construction, agricultural, and retail employment. The City's economic base
viii
includes major employers involved in aerospace, plastics, food processing, professional services, and
education. The City serves as a regional employment and commercial center for surrounding communities,
but maintains a small town atmosphere while enjoying the benefits of being part of the Charlotte
metropolitan region.
Monroe's industrial citizens continue to grow and prosper. ATI Allvac, one of the City's largest employers,
completed Phase 1 of a $250 million, 300,000 square foot facility in the Bakers area, which will eventually
employ 125 workers. Phase 2 is well underway and targeted for completion in early 2010. This new facility
will supply titanium and nickel base super alloys to the global aerospace, automotive and medical fields.
Also, Turbomeca Manufacturing, a maker of helicopter engine components, opened its new 120,000 square
foot facility in the Monroe Corporate Center. Turbomeca Manufacturing, a subsidiary of France's
SAFRAN Group, invested $50 million and will create 180 new jobs over the next two years.
Novant Health, through its affiliation with Presbyterian Healthcare, has completed the first phase of "The
Park at Monroe ", a medical/retail complex on US 74 across from Poplin Place Shopping Center. This
facility will contain medical offices, a same -day surgery facility, and specialty retail shops, and is
scheduled to open in December 2008.
The City's proximity to the Charlotte metropolitan region has contributed to our strong economy, and the
area's labor force continues to expand. While many of our residents travel to Charlotte each day for their
employment, more and more residents are finding employment opportunities in the City and County. This
has resulted in Union County having the lowest unemployment rate in the Charlotte region, and one of the
lowest unemployment rates in the State.
Major Initiatives
The City of Monroe has been involved in many significant initiatives during the past fiscal year. The City
Council has identified and addressed key issues that are of importance to the future of the City, including
utility planning for water, wastewater, electric, and natural gas demands brought on by system growth. The
City has developed a fifteen year rate model for projecting water and wastewater rates to address the impact
of future capital improvement projects on the City's rate structure. The goal is to achieve single digit rate
increases rather than large rate increases in the year infrastructure is financed.
City Council is committed to support the City's growth, and has authorized Certificates of Participation to
fund construction of approximately 43 miles of natural gas pipeline to connect the City's system directly to
the Transcontinental pipeline. The pipeline will provide the City with capacity to significantly grow and
expand the natural gas system and provide significant opportunities for economic development. When
complete, the City will be able to provide natural gas to our industries and citizens without having to pay
costly transportation costs to a third parry provider.
The City issued $30.9 million in Combined Enterprise Fund Revenue Bonds this past fiscal year to fund
projects as follows:
• Water System — Construction of a one million gallon water storage tank and water mains
and lines.
• Natural Gas System — Land acquisition and construction of a 8" natural gas line loop
around the City.
• Electric System — Construction of an electric substation, the installation of new
transformers, the replacement of existing transformers, the construction of
approximately 12.8 miles of transmission loop around the City and the installation of
circuit breakers at an existing substation.
• Airport — Runway extension, rehabilitation and improvements, street rerouting, upgrade
of the terminal building, acquisition of ten T- Hangars and the construction of an
additional ten T- Hangars, and the acquisition of land for future runway extension, road
ramp and taxiway development.
The City is taking steps to implement a stormwater utility effective January 1, 2009, to meet federal
requirements and to also provide for comprehensive management of our drainage and stormwater issues.
Also, a new solid waste enterprise fund was established on July 1, 2008. Revenue and expenses previously
ix
accounted for in the General Fund will now be accounted for in stormwater and solid waste enterprise
funds.
The City has approved a master plan for a reclaimed water system. The reclaimed water distribution
system, currently in the design phase, will allow for the beneficial re -use of treated wastewater for non-
potable uses. Reclaimed water development will also alleviate demands on the City's potable water system
thereby freeing up water capacity for additional economic development. Estimated completion of this
project is late 2010.
The City has partnered with DukeNet Communications to provide access to the City's fiber optic cable
infrastructure to businesses and commercial facilities within the City. Several companies have enrolled for
this service, and recognize the benefit of having a source for high speed data and telephone access with
strong redundancy support.
The City continues to make significant investments in its police and fire operations. The City was notified
in fall 2006 that we received a Staffing for Adequate Fire and Emergency Response ( "SAFER ") Grant to
fund an additional 12 firefighter positions, which allowed us to increase fire department staffing. This
grant is for a period of five years, and requires that the City gradually assume full funding for the positions.
The City's fire department currently holds an ISO rating of "Y', which reflects well on the City's
professional fire operations and our water system infrastructure. This rating also allows the City's
businesses and homes to enjoy lower fire insurance premiums. The City has also received a Federal Fire
Act grant for $210,000 to replace all of the department's self - contained breathing apparatus. The new
breathing apparatus meets the latest standards, therefore providing a safer working environment for the
City's firefighters which aids us in better serving our citizens.
In 2007, our police department was accredited by the Commission on Accreditation for Law Enforcement
Agencies, Inc., or CALEA. The award was presented to the City in July 2007 at the Commission's
conference in Montreal, Quebec, Canada. The accreditation process requires the police department to
comply with applicable standards to improve the delivery of law enforcement services. Accreditation
increases effectiveness, efficiency and the department's ability to prevent and control crime. Adherence to
CALEA standards also increases cooperation and coordination with other law enforcement agencies, as
well as citizen and employee confidence in goals, objectives, policies and practices. In an ongoing effort to
improve the service capabilities of the department, digital cameras are scheduled to be installed during
fiscal year 2009 in all patrol cars.
City Council also recognizes transportation as a major priority. The City is aggressively seeking funding
for roadway improvements, and has been active in its support for the development and construction of the
Monroe Bypass as well as M. L. King Boulevard. Currently, the City of Monroe is moving ahead with the
relocation of Goldmine Road to facilitate the lengthening of the runway at the Charlotte- Monroe Executive
Airport. The City owned and operated airport is a designated general aviation reliever airport to Charlotte
Douglas, and the improvements will strengthen Monroe's position as a major aviation player for the region.
In conjunction with the Downtown Master Plan prepared by Land Design, the City is moving forward with
a number of transportation improvements that will enhance the development of the downtown area, as well
as improve the pedestrian friendliness of the roadways. Two of the primary projects include reducing the
number of lanes on Charlotte Avenue to enable placement of pedestrian refuge islands, and the second is
the conversion of Jefferson Street and Franklin Street to two -way traffic. The City is also moving ahead
with the re- alignment of Concord Avenue with Charlotte Avenue to address congestion as vehicles move
out of the Downtown Area.
City Council has approved a Master Plan for the downtown area. Monroe's Downtown and neighborhood
business districts are no longer the primary provider of goods and services to Union County and
surrounding communities. The growth of the highway system and subsequent suburban sprawl encourage
us to travel longer distances to work or shop. The City of Monroe, Mayor and Council and concerned
citizens would like to reverse this downward spiral, giving Downtown its own market niche. Opening new
businesses Downtown, thereby improving the business mix, attracting shoppers and residents, raising
property values and sales tax revenues are all elements of the plan. Restored buildings, attractive
storefronts and pedestrian friendly walks and streets will gradually change and reinforce the public's
perception that Downtown is the `heart and soul' of Union County. Monroe, designated a National Trust
Main Street Community, uses the Main Street approach to Downtown revitalization, a comprehensive,
incremental four -point approach. The revitalization effort will focus on the areas of design, organization,
promotion, and economic restructuring: a practical Downtown management strategy, in combination with
the Downtown Master Plan, will produce fundamental changes in the Downtown's economic base. The
Monroe City Council has also approved funding for a Wi -Fi network for the downtown business district.
The City of Monroe pursues grant funding to provide resources for the completion of various projects. The
City has received funding for a second phase of the restoration of the Historic Armory facility and three
airport reimbursement grants: one for airport runway lighting rehabilitation, the second for airport land
acquisition, airfield improvements and an updated layout plan, and the third for airport improvements.
The City is also a regular recipient of Local Law Enforcement Block Grants, Community Development
Block Grants, Federal Assistance to Firefighters' Grants, and Homeland Security funds.
Future Considerations
The Governmental Accounting Standards. Board ( "GASB ") issued Statement No. 45 in June 2004. This
Statement establishes standards for the measurement, recognition, and display of other post employment
benefits ( "OPEB ") expenses and related liabilities, note disclosures, and if applicable, required
supplementary information in the financial reports of state and local government employers. This
statement will impact the City to the extent the City provides health insurance benefits to retirees.
Implementation of GASB Statement No. 45 will be required no later than the fiscal year ending June 30,
2009. The City has developed preliminary estimates of the financial impacts the pronouncement through
the assistance of an actuarial firm. Management is currently evaluating recommendations provided by a
plan benefits consultant that specializes in benefit services. The recommendations can reduce the City's
liability for post employment benefits, minimize the cash flow requirement for funding retiree benefits and
retain the benefit contributions as an asset of the City, thereby improving the City's financial statements.
Awards and Acknowledgements
Awards. The Government Finance Officers Association of the United States and Canada ( "GFOA ")
awarded a Certificate of Achievement for Excellence in Financial Reporting to the City of Monroe for its
Comprehensive Annual Financial Report for the fiscal year ended June 30, 2007. This was the 15"'
consecutive year that the City has received this prestigious award. In order to be awarded a Certificate of
Achievement, a government must publish an easily readable and efficiently organized CAFR. This report
must satisfy both GAAP 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.
Acknowledgements. The preparation of this report is a very intensive project, and could not have been
accomplished without the assistance and dedication of the Finance and Administration Department staff
and other personnel from various departments who assisted in its preparation. A particular thank you goes
to Accounting Manager Lisa Strickland and Budget Analyst Mary Lou Clark who have provided valuable
assistance with their financial and accounting expertise this past year.
The Mayor and City Council continue to be very supportive of our efforts to produce the best financial
reports possible for our citizens, and they provide leadership and support in maintaining the highest
standards of professionalism in the fiscal management of the City. We appreciate their support in granting
us the time and funding to generate this document, and allowing us to submit it to the GFOA for
consideration. Lastly, we would like to express our appreciation to our independent auditing firm, Potter &
Company, P.A., for their cooperation and assistance in these efforts.
Respectfi
F. Craigy
City Man - b .,.
ames R. Fatland, CPFO
Director of Finance and Administration
xi
Certificate of
Achievement
f
in Financial
Reporting
Presented to
City of Monroe
North Carolina
For its Comprehensive Annual
Financial Report
for the Fiscal Year Ended .
June 30, 2007
A Certificate of Achievement for Excellence in Financial
Reporting is presented by the Government Finance Officers
Association of the United States and Canada to
government units and public employee retirement
systems whose comprehensive annual financial
reports (CAFRs) achieve the highest
standards in government accounting
and financial reporting.
OF TH
V A _ r
CORPOPAM A � President
*Ape 4 j
Executive Director
xii
CITY OF MONROE,
NORTH CAROLINA
LIST OF PRINCIPAL OFFICIALS
June 30, 2008
Elected Officials
Bobby G. Kilgore
Mayor
P.E. Bazemore
Mayor Pro Tem
John B. Ashcraft, Jr.
Lynn A. Keziah
F. Craig Meadows
City Manager
Terry M. Sholar
City Attorney
Bruce M. Bounds
Director of Information Technology
Debra C. Reed
Director of Human Resources
Don D. Mitchell
Director of Energy Services
Ronald D. Fowler
Fire Chief
C. Michael Courtney
Director of Parks & Recreation
Dottie M. Nash
City Administration
Brian J. Borne
Downtown Monroe Director
Billy A. Jordan
Robert J. Smith
H. Wayne Herron, Jr.
Assistant City Manager/
Director of Planning and Building
Bridgette H. Robinson
City Clerk
James R. Fatland
Director of Finance and Administration
James N. Loyd, Jr.
Director of Engineering
Debra C. Duncan
Police Chief
R. Christopher Plat6
Director of Economic Development and
Aviation
Russell G. Colbath
Director of Water Resources
xiii
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FINANCIAL SECTION
Financial Section
FPJ
POTTER &COMPANY, P.A.
CERTIFIED PUBLIC ACCOUNTANTS
INDEPENDENT AUDITORS' REPORT
The Honorable Mayor and The City Council
City of Monroe
North Carolina
We have audited the accompanying financial statements of the governmental activities, the business -type
activities, the discretely presented component units, each major fund, and the aggregate remaining fund
information of the City of Monroe, North Carolina, as of and for the year ended June 30, 2008, which
collectively comprise the City of Monroe's basic financial statements as listed in the table of contents.
These financial statements are the responsibility of the City of Monroe's management. Our responsibility
is to express an opinion on these financial statements based on our audit.
We conducted our audit in accordance with 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. Those standards require that we plan and perform
the audit to obtain reasonable assurance about whether the basic financial statements are free of material
misstatement. The financial statements of City of Monroe ABC Board and Monroe Tourism Development
Authority were not audited in accordance with Government Auditing Standards. An audit includes
examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements.
An audit also includes assessing the accounting principles used and significant estimates made by
management, as well as evaluating the overall financial statement presentation. We believe that our audit
provides a reasonable basis for our opinion.
In our opinion, the financial statements referred to above present fairly, in all material respects, the
financial position of the governmental activities, the business -type activities, the discretely presented,
component units, each major fund, and the aggregate remaining fund information of the City of Monroe,
North Carolina, as of June 30, 2008, and the respective changes in financial position and cash flows,
where appropriate, thereof and the respective budgetary comparison for the General Fund for the year
then ended in conformity with accounting principles generally accepted in the United States of America.
In accordance with Government Auditing; Standards, we have also issued our report dated October 24,
2008 on our consideration of the City of Monroe's internal control over financial reporting and our tests
of its compliance with certain provisions of laws, regulations, contracts, and grants. That report is an
integral part of an audit performed in accordance with Government Auditing Standards and should be
read in conjunction with this report in considering the results of our audit.
Management's Discussion and Analysis and the Law Enforcement Officers' Special Separation
Allowance Schedule of Funding Progress and Schedule of Employer Contributions are not a required part
of the basic financial statements but are supplementary information required by the Governmental
Accounting Standards Board. We have applied certain limited procedures, which consisted principally of
inquiries of management regarding the methods of measurement and presentation of the required
supplementary information. However, we did not audit this information and express no opinion on it.
Our audit was performed for the purpose of forming an opinion on_ the financial statements that
collectively comprise the basic financial statements of the City of Monroe, North Carolina. The
114 North Church Street ■ Monroe, NC 28112 ■ 704.283.8189 ■ 704.289.3439 fax ■ www.gotopotter.com
introductory section, the other supplementary information section, and the statistical section as listed in
the accompanying table of contents are presented for purposes of additional analysis and are not a
required part of the basic financial statements. The accompanying schedule of expenditures of federal
and State awards is presented for purposes of additional analysis as required by U.S. Office of
Management and Budget Circular A -133, Audits of States, Local Governments, and Non- Profit
Organizations, and the State Single Audit Implementation Act, and are not a required part of the basic
financial statements of the City of Monroe. The other supplementary information and the schedule of
expenditures of federal and State awards have been subjected to the auditing procedures applied in the
audit of the basic financial statements and, in our opinion, are fairly. stated, in all material respects, in
relation to the basic financial statements taken as a whole. The introductory section and the statistical
section have not been subjected to the auditing procedures applied by us in the audit of basic financial
statements and, accordingly, we express no opinion on them.
October 24, 2008
Monroe, North Carolina
2
MANAGEMENT'S
DISCUSSION AND
ANALYSIS
Management's Discussion and Analysis
As management of the City of Monroe (the City), we offer readers of the City's financial statements this
narrative overview and analysis of the financial activities of the City for the fiscal year ended June 30,
2008. We encourage readers to read the information presented here in conjunction with additional
information that we have furnished in the City's financial statements, which follow this narrative.
Financial Highlights
• The assets of the City of Monroe exceeded its liabilities at the close of the fiscal year by
$306,264,024 (net assets). Of this amount, $104,795,099 (unrestricted net assets) may be used to
meet the government's ongoing obligations to citizens and creditors.
• The government's total net assets increased by $18,058,787 of this increase $1,593,075 was from
governmental activities and $16,465,712 was for business -type activities.
• As of the close of the current fiscal year, the City's governmental funds reported combined
ending fund balances of $23,208,182, an increase of $1,288,487 in comparison with the prior
year. Approximately 67% of this total amount or $15,635,606 is available for spending at the
government's discretion (unreserved fund balance).
• At the end of the current fiscal year, unreserved fund balance for the General Fund was
$15,635,606 or 52% of total general fund expenditures for the fiscal year.
• The City's total debt not including compensated absences and self insurance claims payable, net
of retirements, increased $42,899,623 (141 %) during the current fiscal year. The primary
elements of the increase were the issuance of Combined Enterprise System Revenue Bonds
totaling $44,015,000 and two installment financing issuances totaling $3,888,480 offset by
$5,003,857 in debt retirements.
Overview of the Financial Statements
This discussion and analysis is intended to serve as an introduction to City of Monroe's basic financial
statements. The City's basic financial statements consist of three components: 1) government -wide
financial statements, 2) fund financial statements, and, 3) notes to the financial statements (see Figure 1).
The basic financial statements present two different views of the City through the use of government -
wide statements and fund financial statements. In addition to the basic financial statements, this report
contains other supplemental information that will enhance the reader's understanding of the financial
condition of the City of Monroe.
Required Components of Annual Financial Report
Figure 1
Management's Discussion
and Analysis
Government -wide
Financial Statements
Basic Financial
Statements
Fund Financial Notes to the
Statements I Financial Statements
Summary 10 Detail
Basic Financial Statements
The first two statements (Exhibits 1 and 2) in the basic financial statements are the Government -wide
Financial Statements. They provide both short and long -term information about the City's financial
status.
The next statements (Exhibits 3 through 10) are Fund Financial Statements. These statements focus on
the activities of the individual parts of the City's government. These statements provide more detail than
the government -wide statements. There are three parts to the Fund Financial Statements: 1) the
governmental funds statements; 2) the budgetary comparison statements; and, 3) the proprietary fund
statements.
The next section of the basic financial statements is the notes. The notes to the financial statements
explain in detail some of the data contained in those statements. After the notes, supplemental
information is provided to show details about the City's individual funds. Budgetary information
required by the General Statutes also can be found in this part of the statements.
Government -Wide Financial Statements
The government -wide financial statements are designed to provide the reader with a broad overview of
the City's finances, similar in format to a financial statement of a private- sector business. The
government -wide statements provide short and long -term information about the City's financial status as
a whole.
The two government -wide statements report the City's net assets and how they have changed. Net assets
are the difference between the City's total assets and total liabilities. Measuring net assets is one way to
gage the City's financial condition.
The government -wide statements are divided into three categories: 1) governmental activities; 2)
business -type activities; and, 3) component units. The governmental activities include most of the City's
basic services such as public safety, parks and recreation, and general administration. Property taxes and
state and federal grant funds finance most of these activities. The business -type activities are those that
the City charges customers to provide. These include the water and sewer, electric, natural gas, aquatics
and fitness, and airport services offered by the City of Monroe. The final category is the component
units. Although legally separate from the City, the ABC Board and the Tourism Development Authority
are important to the City because the City exercises control over both Boards by appointing their
members. The component units are also required to distribute a portion of their profits to the City.
The government -wide financial statements are on Exhibits 1 and 2 of this report.
Fund Financial Statements
The fund financial statements (see Figure 1) provide a more detailed look at the City's most significant
activities. A fund is a grouping of related accounts that is used to maintain control over resources that
have been segregated for specific activities or objectives. The City of Monroe, like all other
governmental entities in North Carolina, uses fund accounting to ensure and reflect compliance (or non-
compliance) with finance- related legal requirements, such as North Carolina General Statutes or the
City's budget ordinance. All of the funds of City of Monroe can be divided into two categories:
Governmental Funds and Proprietary Funds.
Governmental Funds — Governmental funds are used to account for those functions reported as
governmental activities in the government -wide financial statements. Most of the City's basic services
are accounted for in governmental funds. These funds focus on how assets can readily be converted into
cash flow in and out, and what monies are left at year -end that will be available for spending in the next
year. Governmental funds are reported using an accounting method called modified accrual accounting
4
which provides a short-term spending focus. As a result, the governmental fund financial statements give
the reader a detailed short-term view that helps him or her determine if there are more or less financial
resources available to finance the City's programs. The relationship between government activities
(reported in the Statement of Net Assets and the Statement of Activities) and governmental funds is
described in a reconciliation that is a part of the fund financial statements.
The City of Monroe adopts an annual budget for its General Fund, as required by North Carolina General
Statutes. The budget is a legally adopted document that incorporates input from the citizens of the City,
the management of the City, and the decisions of the Council about which services to provide and how to
pay for them. It also authorizes the City to obtain funds from identified sources to finance these current
period activities. The budgetary statement provided for the General Fund demonstrates how well the City
complied with the budget ordinance and whether or not the City succeeded in providing the services as
planned when the budget was adopted. The budgetary comparison statement uses the budgetary basis of
accounting and is presented using the same format, language, and classifications as the legal budget
document. The statement shows four columns: 1) the original budget as adopted by the Council; 2) the
final budget as amended by the Council; 3) the actual resources, charges to appropriations, and ending
balances in the General Fund; and, 4) the difference or variance between the final budget and the actual
resources and charges. To account for the difference between the budgetary basis of accounting and the
modified accrual basis, a reconciliation showing the differences in the reported activities is shown at the
end of the budgetary statement.
Proprietary Funds — The City of Monroe maintains one type of proprietary fund. Enterprise Funds are
used to report the same functions presented as business -type activities in the government -wide financial
statements. The City uses enterprise funds to account for its water and sewer, electric, natural gas,
aquatics and fitness center, and airport operations. These funds are the same as those functions shown in
the business -type activities in the Statement of Net Assets and the Statement of Activities.
Notes to the Financial Statements — The notes provide additional information that is essential to a full
understanding of the data provided in the government -wide and fund financial statements. The notes to
the financial statements begin on page 30 of this report.
Other Information — In addition to the basic financial statements and accompanying notes, this report
includes certain required supplementary information concerning the City of Monroe's progress in funding
its obligation to provide pension benefits to its employees. Required supplementary information can be
found beginning on page 58 of this report.
Government -Wide Financial Analysis
City of Monroe's Net Assets
Figure 2
Governmental Activities
Business -type Activities
2008 2007
Total
2008 2007
2008 2007
Current and other assets $25,222,942 $24,828,152 $124,887,117 $83,742,212 $151,527,732 $108,570,364
Capital assets 81,287,999 77,718,284 162,558,136 142,274,252 243,846,135 219,992,536
Total assets 106,510,941 102,546,436 287,445,253 226,016,464 395,373,867 328,562,900
Long -term liabilities outstanding 6,564,177 4,923,115 62,085,983 20,822,074 68,650,160 25,745,189
Other liabilities 5,717,321 4,986,953 13,324,689 9,625,521 20,459,683 14,612,474
Total liabilities 12,281,498 9,910,068 75,410,672 30,447,595 89,109,843 40,357,663
Net assets:
Invested capital assets, net of
related debt 73,466,565 71,568,216 127,957,064 118,219,103 201,423,629 189,787,319
Restricted 45,296 143,889 - - 45,296 143,889
Unrestricted 20,717,582 20,924,263 84,077,517 77,349,766 104,795,099 98,274,029
Total net assets $94,229,443 $92,636,368 $212,034,581 $195,568,869 $306,264,024 $288,205,237
As noted earlier, net assets may serve over time as one useful indicator of a government's financial
condition. The assets of the City of Monroe exceeded liabilities by $306,264,024 as of June 30, 2008.
The City's net assets increased by $18,058,787 for the fiscal year ended June 30, 2008.
The largest portion of this increase ($13,240,511) reflects the City's investment in capital assets (e.g.
land, buildings, machinery, and equipment), less any related debt still outstanding that was issued to
acquire those items. The City uses these capital assets to provide services to citizens; consequently, these
assets are not available for future spending. Although the City's investment in its capital assets is
reported net of the outstanding related debt, the resources needed to repay that debt must be provided by
other sources, since the capital assets cannot be used to liquidate these liabilities.
An additional portion of the City's net assets ($45,296) represents resources that are subject to external
restrictions on how they may be used. The remaining balance of $104,795,099 is unrestricted.
Several particular aspects of the City's financial operations positively influenced the total unrestricted
governmental net assets:
• Continued diligence in the collection of property taxes by maintaining a tax collection percentage
of 98.08 %, which is favorably comparable to the statewide average of 97.59 %.
• Continued low cost of debt due to the City's high bond rating.
City of Monroe's Changes in Net Assets
Figure 3
Transfers
(Decrease) Increase in net assets
Net assets as previously reported — 7/l/07
Prior period adjustment— see note X
Net assets restated — 7/l/07
Net assets — 6/30/08
(441,548) 237,210 441,548 (237,210)
3,087,095 537,600 14,848,116 17,528,844
92,636,368 92,098,768 195,568,869 178,040,025
(1,494,020) 1,617,596
91,142,348 197,186,465
Total
Governmental Activities
Business -type
Activities
$85,475,884
2008
2007
2008
2007
Revenues:
$15,303,524
$13,851,160
8,192,064
8,111,690
Program revenues:
202,072
6,848,533
6,327,491
123, 828,913
Charges for services
$4,825,229
$4,914,174
$80,650,655
$76,774,854
Operating grants and contributions
2,404,050
2,267,414
-
-
Capital grants and contributions
2,435,198
44,673
2,918,184
3,353,784
General revenues:
Property taxes
$15,303,524
$13,851,160
-
-
Othertaxes
8,192,064
8,111,690
Grants and contributions not restricted to
specific grant programs
251,476
202,072
-
-
Other
1,933,953
1,582,745
4,914,580
4,744,746
Total revenues
35,345,494
30,973,928
88,483,419
84,873,384
Governmental Activities
Business -type Activities
2008
2007
2008
2007
Expenses:
General government
$4,944,989
$4,176,279
$ -
$ -
Transportation
4,965,651
4,443,989
Public safety
14,246,734
13,557,249
Environmental protection
2,551,419
2,349,393
-
-
Cultureandrecreation
3,922,352
3,801,778
Economic and physical development
948,065
2,140,313
Interest in long -term debt
237,641
204,537
-
Water and sewer
-
-
11,380,664
8,906,769
Electrical
39,702,549
37,041,713
Natural Gas
16,941,568
16,036,744
Aquatics and Fitness Center
3,187,412
2,934,584
Airport
2,864,658
2,187,520
Total expenses
31,816,851
30,673,538
74,076,851
67,107,330
(Decrease) Increase in net assets before
transfers
3,528,643
300,390
14,406,568
17,766,054
Transfers
(Decrease) Increase in net assets
Net assets as previously reported — 7/l/07
Prior period adjustment— see note X
Net assets restated — 7/l/07
Net assets — 6/30/08
(441,548) 237,210 441,548 (237,210)
3,087,095 537,600 14,848,116 17,528,844
92,636,368 92,098,768 195,568,869 178,040,025
(1,494,020) 1,617,596
91,142,348 197,186,465
Total
$4,176,279
2008
2007
$85,475,884
$81,689,028
2,404,050
2,267,414
5,353,382
3,398,457
$15,303,524
$13,851,160
8,192,064
8,111,690
251,476
202,072
6,848,533
6,327,491
123, 828,913
115, 847,312
Total
2,934,584
2008
2007
$4,944,989
$4,176,279
4,965,651
4,443,989
14,246,734
13,557,249
2,551,419
2,349,393
3,922,352
3,801,778
948,065
2,140,313
237,641
204,537
11,380,664
8,906,769
39,702,549
37,041,713
16,941,568
16,036,744
3,187,412
2,934,584
2,864,658
2,187,520
105,893,702
97,780,868
17,935,211 18, 066,444
17,935,211 18, 066,444
288,205,237 270,138,793
123,576
288,328,813
$94,229,443 $92,636,368 $212,034,581 $195,568,869 $306,264,024 $288,205,237
Governmental activities — Governmental activities increased the City of Monroe's net assets by
$3,087,095. Key elements of this net increase are as follows:
6
An increase in property taxes of 10.5% ($1,452,364), due primarily to a ad valorem tax rate
increase of .02 cents.
An increase in capital grants and contributions of $2,390,525 was due to the acceptance of
infrastructure which includes streets, curbs, sidewalks and stormwater, for several subdivisions
including Lexington Commons, Southwinds, Hamilton Place, Charlestown Townhomes and East
Village.
A decrease in economic and physical development expenses of $1,192,248 was due to a decrease
in economic incentive grants.
Business -type activities — Business -type activities increased the City of Monroe's net assets by
$14,848,116 accounting for 83% of the total net growth in the government's net assets.
Financial Analysis of the City's Funds
As noted earlier, the City of Monroe uses fund accounting to ensure and demonstrate compliance with
finance- related legal requirements.
Governmental Funds — The focus of the City of Monroe's governmental funds is to provide information
on near -term inflows, outflows, and balances of usable resources. Such information is useful in assessing
the City's financing requirements. Specifically, unreserved fund balance can be a useful measure of a
government's net resources available for spending at the end of the fiscal year.
The General Fund is the chief operating fund of the City of Monroe. At the end of the current fiscal year,
unreserved fund balance of the General Fund was $15,635,606, while total fund balance increased to
$20,607,546. As a measure of the General Fund's liquidity, it may be useful to compare both unreserved
fund balance and total fund balance to total fund expenditures. At June 30, 2008, unreserved fund
balance is 52% of General Fund expenditures, while total fund balance is 69% of that same amount.
At June 30, 2008, the governmental funds of City of Monroe reported a combined fund balance of
$23,208,182. Fund balance for General Fund increased $2,553,414 while fund balance for the Special
Revenue and Capital Projects Funds decreased $1,264,927.
Proprietary Funds — The City of Monroe's proprietary funds provide the same type of information found
in the government -wide statements but in more detail. The table below presents the unrestricted net assets
and the total growth in net assets for all proprietary funds.
General Fund Budgetary Highlights
During the fiscal year, the City of Monroe revised the budget on several occasions. Generally, budget
amendments fall into one of three categories: 1) amendments made to adjust the estimates that are used to
prepare the original budget ordinance once exact information is available; 2) amendments made to
recognize new funding amounts from external sources, such as federal and State grants; and, 3) increases
in appropriations that become necessary to maintain services.
Total amendments to the General Fund increased expenditures by $2,088,199 or 6.47 %. The key
differences between the original budget and the final amended budget can be briefly summarized as
follows:
Unrestricted Net Assets
Growth in Net Assets
2008
2007
2008
2007
Water and Sewer
$20,974,365
$19,579,835
$5,636,701
$8,250,041
Electric
47,367,775
43,884,439
6,034,711
4,658,126
Natural Gas
11,611,959
10,454,846
2,556,349
2,655,108
Aquatics and Fitness Center
2,931,712
2,442,399
1,044,864
1,145,214
Airport
1,191,706
988,247
(424,509)
820,355
General Fund Budgetary Highlights
During the fiscal year, the City of Monroe revised the budget on several occasions. Generally, budget
amendments fall into one of three categories: 1) amendments made to adjust the estimates that are used to
prepare the original budget ordinance once exact information is available; 2) amendments made to
recognize new funding amounts from external sources, such as federal and State grants; and, 3) increases
in appropriations that become necessary to maintain services.
Total amendments to the General Fund increased expenditures by $2,088,199 or 6.47 %. The key
differences between the original budget and the final amended budget can be briefly summarized as
follows:
• Funds were appropriated for prior year encumbrances in the amount of $488,781.
• Funds were appropriated for grants and donations received in the amount of $291,048.
Revenues exceeded final budget by $1,612,632 or 5.21 %.
Expenditures increased almost 6.5% from the prior year, but were 93% of the final amended expenditure
budget. Expenditures were held $2.4 million below final budget amounts. Some of the key differences
are as follows:
• A continued emphasis on cost control and prudent financial management by City department
directors.
• General Government expenditures were $1.2 million below the final budget primarily due to
position vacancies and deferring professional and technical services.
• Culture and Recreation expenditures were $.5 million below the final budget due to position
vacancies and unspent building maintenance funds.
Capital Asset and Debt Administration
Capital assets — The City of Monroe's investment in capital assets for its governmental and business —type
activities as of June 30, 2008, totals $243,846,134 (net of accumulated depreciation). These assets
include buildings, roads and bridges, land, enterprise systems infrastructure, machinery and equipment,
park facilities, and vehicles.
Major capital asset transactions during the year include the following additions:
• Electric and natural gas distribution systems construction
• Water distribution and sewer collection systems construction
• Airport improvements
• New fire station 45
• Park Williams Athletic Center
• General Fund infrastructure including streets, curbs, sidewalks and stormwater
Capital Assets
(Net of Depreciation)
Figure 4
Additional information on the City's capital assets can be found in note IV.A.5 of the Basic Financial
Statements.
Governmental Activities
$13,147,940 $13,147,940
28,762,699 28,438,576
4,479,272 5,825,173
2008
2007
$17,319,405
$17,332,480
38,663,889
36,658,414
6,007,825
7,436,501
6,555,838
6,756,348
147, 572,011
143, 527,027
27,727,167
8,281,766
$243,846,135
$219,992,536
Business -type Activities
2008 2007
Total
2008 2007
Land
$4,171,465
$4,184,540
Buildings and improvements
9,901,190
8,219,838
Equipment
1,528,553
1,611,328
Vehicles and motorized
equipment
4,949,026
4,974,573
Infrastructure
57,220,620
56,986,951
Construction in progress
3,517,145
1,741,054
Total
$81,287,999
$77,718,284
1,606,812
1,781,775
90,3 51, 391
86,540,076
24,210,022
6,540,712
$162,558,136
$142,274,252
Long -term Debt — As of June 30, 2008, the City of Monroe had total bonded debt outstanding of
$54,600,000. Of this, $790,000 is debt backed by the full faith and credit of the City. The remainder of
the City's bonded debt represents bonds secured solely by specified revenue sources (i.e. revenue bonds).
8
City of Monroe's Outstanding Debt
General Obligation and Revenue Bonds
Figure 5
2uux 2001
General obligation bonds $790,000 $1,450,000
Revenue bonds 53,810,000 10,385,000
Total $54,600,000 $11,835,000
As mentioned in the financial highlights of this document, the City's total debt, net of retirements,
increased $42,899,623 during the fiscal year. The primary elements of the increase were the issuance of
Combined Enterprise System Revenue Bonds totaling $44,015,000 and two new installment financing
issuances totaling $3,888,480 for equipment purchases and facility improvements and $5,003,857 in debt
retirements.
The City of Monroe continues to maintain its Al bond rating from Moody's Investor Service and A+
rating from Standard and Poor's Corporation. These bond ratings are clear indications of the sound
financial condition of the City of Monroe.
North Carolina General Statutes limit the amount of general obligation debt that a unit of government can
issue to eight percent of the total assessed value of taxable property located within that government's
boundaries. The legal debt margin for the City of Monroe is $206,209,775.
Additional information regarding the City of Monroe's long -term debt can be found in note IV.B.7.
beginning on page 49 of this report.
Economic Factors and Next Year's Budgets and Rates
The following key economic indicators reflect the growth and prosperity of the City.
The annual unemployment rate for Union County has risen to 5.6 %, however, this amount has
remained consistently below the State's average rate of 6.2 %.
Despite the national economic slowdown, commercial growth continued to be strong increasing
16.8% over 2007. This increase is attributed to capital investments by Goodrich Corporation,
Electricities, American Wick Drain and ATI Allvac. Other commercial and retail development
and expansion has been strong as well. Reserve capacity for water and sewer for continued
commercial and industrial growth is available.
Residential development decreased to $35 million partly due to a residential moratorium imposed
by City Council in January 2008 and a nationwide housing slowdown.
Governmental Activities — Property taxes (benefiting from revaluation and a $.025/$100 valuation tax
rate increase) and other taxes and licenses are expected to lead the increase in budgeted revenue by 7.8 %.
The City will use these increases in revenues to finance programs currently in place.
Budgeted expenditures in the General Fund are expected to increase approximately 17.1 %. The largest
components of the increase are a new fire station and the addition of seven new full -time employees
including four additional police officers, two additional code enforcement officers, and one new Armory
Center employee.
Business -type Activities — The following are highlights for the 2009 budgets for the business -type
activities:
• The budget for Business -type operating expenses increased by 15.3% in FY 09 versus FY 08.
The largest increase was in natural gas utility which is the result of an increase in the cost of
natural gas purchases for resale.
Water and sewer rates were increased by 4.5% to plan for the significant anticipated cost of
future capital projects. Electric and natural gas rates remained the same.
The City has established two new business -type funds for fiscal year 2009 to account for
Stormwater and Solid Waste activity. Revenues and Expenditures for Stormwater and Solid
Waste were previously accounted for in the City's General Fund.
Requests for Information
This report is designed to provide an overview of the City's finances for those with an interest in this
area. Questions concerning any of the information found in this report or requests for additional
information should be directed to the City of Monroe Department of Finance and Administration at 300
West Crowell Street, Monroe, North Carolina, 28112, or visit the City's website at www.monroenc.org
10
BASIC FINANCIAL
STATEMENTS
Basic Financial Statements
The Basic Financial Statements provide a summary overview of the
financial position of the governmental activities, the business -type
activities, the discretely presented component unit, each major fund, and
the aggregate remaining fund information at June 30, and the respective
changes in financial position and cash flows, where appropriate for the
year then ended.
• Government -Wide Financial Statements
• Fund Financial Statements
Governmental Fund Financial Statements
Proprietary Fund Financial Statements
• Notes to Financial Statements
• Required Supplemental Information
CITY OF MONROE, NORTH CAROLINA
STATEMENT OFNETASSETS
June 30, 2008
EXHIBIT 1
LIABILITIES
Current liabilities
Accounts payable and accrued liabilities
Primary Government
Component Units
10,037,835
380,848 43
Unearned revenue
329,965
-
Monroe
- -
Self- insurance fund claims payable
292,225
-
292,225
Tourism
Due to primary government
Governmental
Business -type
-
City of Monroe
Development
3,384,299
Activities
Activities
Total
ABC Board
Authority
ASSETS
984,926
- -
Unamortized premium
-
378,223
Current assets:
- -
Long -term liabilities:
Cash and cash equivalents
$ 19,882,749
$ 77,715,435
$ 97,598,184
$ 655,695
$ 152,675
Taxes receivable
859,755
-
859,755
-
-
Accounts receivable
687,355
6,611,234
7,298,589
4,665
39,415
Note receivable
-
423,156
423,156
-
-
Due from other governments
3,182,672
-
3,182,672
-
-
Due from component units
69,610
-
69,610
-
-
Inventories
344,852
4,273,043
4,617,895
272,469
-
Loans receivable (net)
21,379
-
21,379
-
-
Total current assets
25,048,372
89,022,868
114,071,240
932,829
192,090
Restricted assets:
Cash and cash equivalents
1,462,912
32,546,797
34,009,709
-
-
Noncurrent assets:
Note receivable
-
1,156,280
1,156,280
-
-
Due from (to) other funds
(1,417,673)
1,417,673
-
-
-
Deferred charges
-
743,499
743,499
-
-
Prepaid pension obligation
129,331
-
129,331
-
-
Capital assets
Land, non - depreciable improvements,
and construction in progress
7,688,610
37,357,962
45,046,572
317,013
-
Other capital assets, net of depreciation
73,599,389
125,200,174
198,799,563
787,852
-
Total capital assets
81,287,999
162,558,136
243,846,135
1,104,865
-
Total noncurrent assets
79,999,657
165,875,588
245,875,245
1,104,865
-
Total assets
106,510,941
287,445,253
393,956,194
2,037,694
192,090
LIABILITIES
Current liabilities
Accounts payable and accrued liabilities
1,710,832
8,327,003
10,037,835
380,848 43
Unearned revenue
329,965
-
329,965
- -
Self- insurance fund claims payable
292,225
-
292,225
- -
Due to primary government
-
-
-
50,000 19,751
Current portion of long -term liabilities
3,384,299
3,634,537
7,018,836
50,000 -
Payable from restricted assets
-
984,926
984,926
- -
Unamortized premium
-
378,223
378,223
- -
Long -term liabilities:
Due in more than one year
6,564,177
62,085,983
68,650,160
212,500 -
Total liabilities
12,281,498
75,410,672
87,692,170
693,348 19,794
NET ASSETS
Invested in capital assets, net of
related debt
73,466,565 127,957,064
201,423,629
842,366 -
Restricted for:
Streets
45,296 -
45,296
- -
Other purposes
- -
-
151,706 -
Unrestricted
20,717,582 84,077,517
104,795,099
350,274 172,296
Total net assets
$ 94,229,443 $ 212,034,581
$ 306,264,024 $
1,344,346 $ 172,296
The notes to the financial statements are an integral part of this statement.
13
CITY OF MONROE, NORTH CAROLINA
STATEMENT OFACTIVITIES
For the Year Ended June 30, 2008
Program Revenues
Operating
Grants Capital Grants
Charges for and and
Functions/Programs Expenses Services Contributions Contributions
Primary government:
Governmental activities
General government
$ 4,944,989
$ 1,132,181 $
Transportation
4,965,651
-
Public safety
14,246,734
50,534
Environmental protection
2,551,419
2,795,464
Culture and recreation
3,922,352
843,633
Economic and physical development
948,065
3,417
Interest on long -term debt
237,641
-
Total governmental activities
31,816,851
4,825,229
Business -type activities:
Water and sewer
Electric
Natural gas
Aquatics and Fitness Center
Airport
Total business -type activities
Total primary government
11,3 80,664 12,705,298
39,702,549 43,050,885
16,941,568 18,836,178
3,187,412 4,161,767
2,864,658 1,896,527
-7n n-7< oci on <cn <cc
7,873 $
1,153,571
1,017,436
1,625
216,370
7,175
2,435,198
2,404,050 2,435,198
- 2,918,184
- 2,918,184
$ 105,893,702 $ 85,475,884 $ 2,404,050 $ 5,353,382
Component units:
ABC Board
Tourism Development Authority
Total component units
$ 4,865,565 $ 4,971,135 $ - $ -
290,112 - 315,890 -
$ 5,155,677 $ 4,971,135 $ 315,890 $ -
General revenues:
Taxes:
Property taxes, levied for general purpose
Local option sales tax
Utility taxes
Other taxes
Grants and contributions not restricted to specific programs
Unrestricted investment earnings
Miscellaneous
Gain on sale of capital assets
Transfers
Total general revenues and transfers
Change in net assets
Net assets, beginning as previously reported
Prior period adjustment - see note X
Net assets, beginning as restated
Net assets, ending
The notes to the financial statements are an integral part of this statement.
14
EXHIBIT 2
Net (Expense) Revenue and Changes in Net Assets
Primary Government Component Units
Monroe
Tourism
Governmental Business -type City of Monroe Development
Activities Activities Total ABC Board Authority
$ (3,804,935) $ - $ (3,804,935) -
(1,376,882) - (1,376,882) - -
(13,178,764) - (13,178,764) - -
245,670 - 245,670 - -
(2,862,349) - (2,862,349) - -
(937,473) - (937,473) - -
(237,641) - (237,641) - -
(22,152,374) - (22,152,374)
- 4,242,818
- 3,348,336
- 1,894,610
- 974,355
- (968,131)
- 9,491,988
(22,152,374) 9,491,988
4,242,818
3,348,336
1,894,610
974,355
(968,131)
9,491,988
(12,660,3 86)
- - - 105,570
- - - - 25,778
- - - 105,570 25,778
15,303,524
-
15,303,524
-
-
4,884,108
-
4,884,108
-
-
1,430,266
-
1,430,266
-
-
1,877,690
-
1,877,690
-
-
251,476
-
251,476
-
-
1,258,817
4,853,409
6,112,226
18,044
4,050
475,924
59,869
535,793
-
-
199,212
1,302
200,514
-
-
(441,548)
441,548
-
-
-
25,239,469
5,356,128
30,595,597
18,044
4,050
3,087,095
14,848,116
17,935,211
123,614
29,828
92,636,368
195,568,869
288,205,237
1,220,732
142,468
(1,494,020)
1,617,596
123,576
-
-
91,142,348
197,186,465
288,328,813
1,220,732
142,468
$ 94,229,443
$ 212,034,581
$ 306,264,024 $
1,344,346 $
172,296
15
CITY OF MONROE, NORTH CAROLINA
BALANCE SHEET
GOVERNMENTAL FUNDS
June 30, 2008
ASSETS
Cash and cash equivalents
Receivables:
Taxes
Accounts
Due from other governments
Due from component unit
Inventories
Loans receivable (net)
Cash and cash equivalents - restricted
Total assets
LIABILITIES AND FUND BALANCES
Liabilities:
Accounts payable and accrued liabilities
Deferred revenue
Unearned revenue
Self- insurance fund claims payable
Total liabilities
Fund balances:
Reserved for:
Encumbrances
State statute
Streets - Powell bill
Unreserved for General Fund:
Designated for subsequent year's expenditures
Designated for self- insurance expenditures
Undesignated
Unreserved for reported in:
Special Revenue Funds
Capital Projects Funds
Total fund balances
Total liabilities and fund balances
General
$ 17,132,892 $
823,857
684,038
3,182,672
69,610
344,853
1,462, 912
EXHIBIT 3
Total
Governmental
Funds
2,749,857 $ 19,882,749
35,897 859,754
3,317 687,355
- 3,182,672
- 69,610
- 344,853
21,379 21,379
- 1,462,912
$ 23,700,834 $ 2,810,450 $ 26,511,284
$ 1,523,689 $ 187,144 $ 1,710,833
947,409 22,670 970,079
329,965 - 329,965
292,225 - 292,225
3,093,288 209,814 3,303,102
769,023
-
769,023
4,157,621
3,317
4,160,938
45,296
45,296
2,230,971
-
2,230,971
2,658,307
-
2,658,307
10,746,328
-
10,746,328
-
1,417,825
1,417,825
-
1,179,494
1,179,494
20,607,546
2,600,636
23,208,182
$ 23,700,834 $ 2,810,450 $ 26,511,284
The notes to the financial statements are an integral part of this statement.
Other
Governmental
Funds
16
CITY OF MONROE, NORTH CAROLINA
RECONCILIATION OF GOVERNMENTAL FUNDS
BALANCE SHEET TO THE STATEMENT OF NET ASSETS
June 30, 2008
Amounts reported for governmental activities in the
statement of net assets are different because:
Fund balances - total governmental funds (Exhibit 3)
Capital assets used in governmental activities are not
financial resources and therefore are not reported in the funds.
Gross capital assets at historical cost
Accumulated depreciation
Other long -term assets are not available to pay for current period
expenditures and therefore are deferred in the funds.
Prepaid pension obligation
Liabilities for earned but deferred revenues in fund statements.
Principal repayment of loan from Electric Fund
Long -term liabilities are not due and payable in the current period
and therefore are not reported in the funds (Note IILA.).
Prior period adjustment, see note X
Net assets of governmental activities (Exhibit 1)
The notes to the financial statements are an integral part of this statement.
$ 123,057,823
(41,769,824
EXHIBIT 4
$ 23,208,182
81,287,999
129,331
970,079
76,348
(9,948,476)
(1,494,020)
$ 94,229,443
17
CITY OF MONROE, NORTH CAROLINA
STATEMENT OF REVENUES, EXPENDITURES, AND CHANGES
IN FUND BALANCES -- GOVERNMENTAL FUNDS
For the Year Ended Tune 30, 2008
Ia1:I011 "M m
Other Total
Governmental Governmental
General Funds Funds
REVENUES
Ad valorem taxes
Other taxes and licenses
Unrestricted intergovernmental
Restricted intergovernmental
Program income
Sales and services
Investment earnings
Miscellaneous
Total revenues
EXPENDITURES
Current:
General government
Transportation
Public safety
Environmental protection
Culture and recreation
Economic and physical development
Capital outlay
Debt service:
Principal retirement
Interest and other charges
Total expenditures
Deficiency of revenues under expenditures
OTHER FINANCING SOURCES (USES)
Transfers from other funds
Transfers to other funds
Installment purchase obligations issued
Total other financing sources (uses)
Net change in fund balances
Fund balance, beginning
Fund balances, ending
$ 15,227,297 $
38,022 $
15,265,319
855,174
371,635
1,226,809
7,177,379
-
7,177,379
2,315,050
62,589
2,377,639
-
5,543
5,543
5,137,066
-
5,137,066
1,241,930
16,888
1,258,818
650,277
-
650,277
32,604,173
494,677
33,098,850
4,670,579
-
4,670,579
2,905,734
-
2,905,734
14,260,777
-
14,260,777
2,551,419
-
2,551,419
3,676,005
-
3,676,005
-
829,538
829,538
-
3,817,516
3,817,516
1,660,339
-
1,660,339
182,511
-
182,511
29,907,364
4,647,054
34,554,418
2,696,809
(4,152,377)
(1,455,568)
68,345
1,043,195
1,111,540
(1,628,820)
(55,745)
(1,684,565)
1,417,080
1,900,000
3,317,080
(143,395
2,887,450
2,744,055
2,553,414
(1,264,927)
1,288,487
18,054,132
3,865,563
21,919,695
$ 20,607,546 $
2,600,636 $
23,208,182
The notes to the financial statements are an integral part of this statement.
18
CITY OF MONROE, NORTH CAROLINA
RECONCILIATION OF THE STATEMENT OF REVENUES, EXPENDITURES,
AND CHANGES IN FUND BALANCES OF GOVERNMENTAL FUNDS
TO THE STATEMENT OFACTIVITIES
For the Year Ended June 30, 2008
Amounts reported for governmental activities in the statement of activities
are different because:
Net change in fund balances - total governmental funds (Exhibit 5)
Governmental funds report capital outlays as expenditures. However,
in the statement of activities the cost of those assets is allocated
over their estimated useful lives and reported as depreciation expense.
This is the amount by which depreciation exceeded capital outlays
in the current period (Note ILB.).
Governmental funds report the proceeds from the sale of capital assets
as an increase in financial resources. In the statement of activities, only
the gain (loss) on the sale of capital assets is reported. Thus, the change
in net assets differs from the change in fund balance by the net book
value of the capital assets sold.
Revenues in the statement of activities that do not provide current
financial resources are not reported as revenues in the funds.
Change in deferred revenue
Change in allowance for loans receivable
The issuance of long -term debt provides current financial resources
to governmental funds, while the repayment of the principal of long -term
debt consumes the current financial resources of governmental funds.
Neither transaction has any effect on net assets in the government -wide
statements. Also, governmental funds report the effect of issuance costs,
premiums, discounts and similar items when debt is first issued, whereas
these amounts are deferred and amortized in the statement of activities.
This amount is the net effect of these differences in the treatment of
long -term debt and related items (Note ILB.).
Principal repayment of loan from Electric Fund
Some expenses reported in the statement of activities do not require
the use of current financial resources and, therefore, are not reported
as expenditures in governmental funds.
Compensated absences
Net pension obligation
Self- insurance fund claims payable
Change in net assets of governmental activities (Exhibit 2)
The notes to the financial statements are an integral part of this statement.
$ 36,240
(3,507)
(127,305)
11,727
(93,241)
W.4.11.
$ 1,288,487
3,729,520
(159,805)
32,733
(1,671,367)
76,346
(208,819)
$ 3,087,095
19
.10 \'ROH;
CITY OF MONROE, NORTH CAROLINA
STATEMENT OF REVENUES, EXPENDITURES, AND CHANGES
IN FUND BALANCES -- BUDGET AND ACTUAL --
GENERAL FUND
For the Year Ended Tune 30, 2008
REVENUES
Ad valorem taxes
Other taxes and licenses
Unrestricted intergovernmental
Restricted intergovernmental
Sales and services
Investment earnings
Miscellaneous
Total revenues
EXPENDITURES
Current:
General government
Transportation
Public safety
Environmental protection
Culture and recreation
Debt service:
Principal retirement
Interest and other charges
Total expenditures
Revenues over (under) expenditures
OTHER FINANCING SOURCES (USES)
Transfers from other funds
Transfers to other funds
Installment purchase obligations issued
Total other financing sources (uses)
FUND BALANCE APPROPRIATED
Net change in fund balance
Fund balance, beginning
Fund balance, ending
The notes to the financial statements are an integral part of this statement.
Ia1:I0/11 1
Variance with
Budgeted Amounts Final Budget -
Actual Positive
Original Final Amounts (Negative)
$ 14,078,000 $ 14,501,657 $ 15,227,297 $ 725,640
758,000
758,000
855,174
97,174
6,857,500
6,857,500
7,177,379
319,879
1,688,846
1,979,894
2,315,050
335,156
5,127,180
5,341,475
5,137,066
(204,409)
720,000
1,075,640
1,241,930
166,290
448,800
477,375
650,277
172,902
29,678,326
30,991,541
32,604,173
1,612,632
4,958,901
5,894,936
4,670,579
1,224,357
2,823,319
3,129,075
2,905,734
223,341
13,816,757
14,455,510
14,260,777
194,733
2,361,016
2,561,016
2,551,419
9,597
4,021,778
4,224,433
3,676,005
548,428
2,212,845
1,780,204
1,660,339
119,865
-
237,641
182,511
55,130
30,194,616
32,282,815
29,907,364
2,375,451
(516,290
(1,291,274
2,696,809
3,988,083
48,000
70,600
68,345
(2,255)
(876,815)
(1,856,054)
(1,628,820)
227,234
1,477,305
1,477,305
1,417,080
(60,225
648,490
(308,149
(143,395
164,754
(132,200
1,599,423
-
(1,599,423)
2,553,414
$ 2,553,414
18,054,132
$ 20,607,546
21
CITY OF MONROE, NORTH CAROLINA
STATEMENT OF NET ASSETS
PROPRIETARY FUNDS
June 30, 2008
ASSETS
Current assets:
Cash and cash equivalents
Accounts receivable
Note receivable
Inventories
Total current assets
Noncurrent assets:
Restricted assets:
Cash and cash equivalents:
Unspent bond proceeds
Customer deposits
Bond issuance costs
Due from other funds
Long -term note receivable
Capital assets:
Land and other non - depreciable assets
Other capital assets, net of depreciation
Capital assets (net)
Total noncurrent assets
Total assets
LIABILITIES
Current liabilities:
Accounts payable and accrued liabilities
Compensated absences
Installment purchase obligations
General obligation bonds payable
Revenue bonds payable
State revolving loans payable
Total current liabilities
Liabilities payable from restricted assets:
Customer deposits
Noncurrent liabilities:
Compensated absences
Bond premium
Installment purchase obligations
General obligation bonds payable
Revenue bonds payable
State revolving loans payable
Total noncurrent liabilities
Total liabilities
NET ASSETS
Invested in capital assets, net of related debt
Unrestricted
Total net assets
Major Enterprise
Water
and Sewer Electric Natural Gas
$ 20,143,862 $ 42,054,450 $ 11,419,200
889,689 4,184,009 1,443,207
- 423,156 -
349,624 3,624,732 179,451
21,383,175 50,286,347 13,041,858
5,352,950
13,840,962
1,145,417
120,897
611,514
252,515
99,716
423,923
70,286
-
1,417,673
-
-
1,156,280
-
2,013,593
20,787,478
4,725,740
59,490,830
38,068,902
12,786,708
61,504,423
58,856,380
17,512,448
67,077,986
76,306,732
18,980,666
88,461,161
126,593,079
32,022,524
446,843
5,924,862
1,618,605
143,582
70,092
18,374
237,936
167,525
56,685
650,000
-
-
341,992
197,296
85,712
827,077
-
-
2,647,430
6,359,775
1,779,376
120,897
611,514
252,515
70,720
34,523
9,051
64,072
269,176
44,975
377,773
378,076
162,266
129,152
-
-
10,756,814
24,382,131
4,707,889
5,104,832
-
-
16,624,260
25,675,420
5,176,696
19,271,690
32,035,195
6,956,072
48,215,106
47,190,109
13,454,493
20,974,365
47,367,775
11,611,959
$ 69,189,471
$ 94,557,884
$ 25,066,452
The notes to the financial statements are an integral part of this statement.
22
EXHIBIT 8
Nonmajor
Enterprise
Funds Fund
Aquatics and
Fitness Center Airport Total
$ 3,066,709 $ 1,031,214 $ 77,715,435
39,147 55,182 6,611,234
- - 423,156
8,224 111,012 4,273,043
3,114,080 1,197,408 89,022,868
- 11,222,542 31,561,871
- - 984,926
- 149,574 743,499
- - 1,417,673
- - 1,156,280
925,594
8,905,557
37,357,962
7,598,880
7,254,854
125,200,174
8,524,474
16,160,411
162,558,136
8,524,474
27,532,527
198,422,385
11,638,554
28,729,935
287,445,253
-
-
5,104,832
146,630
190,063
8,327,003
23,944
-
255,992
778,386
35,936
1,276,468
-
-
650,000
-
-
625,000
-
-
827,077
948,960
225,999
11,961,540
984,926
11,794
-
126,088
-
-
378,223
2,789,825
76,137
3,784,077
-
-
129,152
-
13,095,000
52,941,834
-
-
5,104,832
2,801,619
13,171,137
63,449,132
3,750,579
13,397,136
75,410,672
4,956,263
14,141,093
127,957,064
2,931,712
1,191,706
84,077,517
$ 7,887,975
$ 15,332,799
$ 212,034,581
23
CITY OF MONROE, NORTH CAROLINA
STATEMENT OF REVENUES, EXPENSES, AND CHANGES IN
FUND NET ASSETS -- PROPRIETARY FUNDS
For the Year Ended June 30, 2008
Major Enterprise
OPERATING REVENUES
Charges for services
Other operating revenues
Total operating revenues
OPERATING EXPENSES
Distribution systems
Water filter plant
Waste treatment plant
Electric power purchases
Natural gas purchases
Aquatics and Fitness Center operations
Airport operations
Depreciation and amortization
Total operating expenses
Operating income (loss)
NONOPERATING REVENUES (EXPENSES)
Rate stabilization funds
Power agency funding
Gain (loss) on sale of capital assets
Availability fees
Other nonoperating revenues
Investment earnings
Interest and other charges
Total nonoperating revenues (expenses)
Income (loss) before contributions and transfers
CAPITAL CONTRIBUTIONS
CAPITAL GRANTS
TRANSFERS FROM OTHER FUNDS
TRANSFERS TO OTHER FUNDS
Change in net assets
Total net assets, beginning
Prior period adjustment - see note X
Total net assets, beginning as restated
Total net assets, ending
The notes to the financial statements are an integral part of this statement.
Water
$ 12,473,097 $ 42,961,611 $ 18,806,722
232,201 89,274 29,456
12,705,298 43,050,885 18,836,178
5,086,243 3,028,621 2,323,695
2,557,332 - -
2,368,124 - -
- 35,396,259 -
- - 14,101,837
1,714,407
1,917,006
422,100
11,726,106
40,341,886
16,847,632
979,192
2,708,999
1,988,546
-
181,068
-
-
767,556
-
27,750
-
(26,448)
1,009,760
-
-
11,003
45,874
2,992
1,269,550
2,646,701
591,595
(664,318
(309,287
(93,936
1,653,745
3,331,912
474,203
2,632,937
6,040,911
2,462,749
2,918,184 - -
595,453 - 100,000
(509,873 (6,200 (6,400
5,636,701 6,034,711 2,556,349
63,552,770 86,905,577 22,510,103
- 1,617,596 -
63,552,770 88,523,173 22,510,103
$ 69,189,471 $ 94,557,884 $ 25,066,452
24
VA:I1 AU
Nonmajor
Enterprise
Funds Fund
Aquatics and
Fitness Center Airport Total
$ 3,994,631 $ 1,853,420 $ 80,089,481
167,136 43,107 561,174
4,161,767 1,896,527 80,650,655
- - 10,438,559
- - 2,557,332
- - 2,368,124
- - 35,396,259
- - 14,101,837
2,758,767 - 2,758,767
- 2,251,145 2,251,145
1,146,739 (878,635) 5,944,841
- - 181,068
- - 767,556
- - 1,302
- - 1,009,760
- - 59,869
170,509 175,054 4,853,409
17( 2,384) (89,496) (1,329,421)
(1,875) 85,558 5,543,543
1,144,864 (793,077) 11,488,384
- - 2,918,184
-
368,568
1,064,021
(100,000)
-
(622,473)
1,044,864
(424,509)
14,848,116
6,843,111
15,757,308
195,568,869
-
-
1,617,596
6,843,111
15,757,308
197,186,465
$ 7,887,975
$ 15,332,799
$ 212,034,581
25
CITY OF MONROE, NORTH CAROLINA
STATEMENT OF CASH FLOWS
PROPRIETARY FUNDS
For the Year Ended June 30, 2008
CASH FLOWS FROM OPERATING ACTIVITIES
Cash received from customers
Cash paid for goods and services
Cash paid to or on behalf of employees for services
Customer deposits received
Customer deposits returned
Other operating revenues
Net cash provided (used) by operating activities
CASH FLOWS FROM NONCAPITAL FINANCING ACTIVITIES
Transfers from other funds
Transfers to other funds
Net cash provided (used) by noncapital financing activities
CASH FLOWS FROM CAPITAL AND RELATED
FINANCING ACTIVITIES
Proceeds from issuance of long -term debt
Proceeds from sale of capital assets
Acquisition and construction of capital assets
Note receivable collected
Principal paid on bond maturities and equipment obligations
Interest paid on bond maturities and equipment obligations
Rate stabilization funds
Power agency funds
Availability fees
Bond issuance costs
Net cash used by capital and related financing activities
CASH FLOWS FROM INVESTING ACTIVITIES
Earnings on investments
Net increase in cash and cash equivalents
Water
and Sewer Electric Natural Gas
Major Enterprise
$ 12,691,436
(6,502,106)
(3,286,799)
79,928
(111,224)
243,204
$ 42,450,061
(35,605,101)
(726,275)
383,552
(565,013)
135,148
$ 18,560,045
(15,101,388)
(601,627)
158,411
(194,772)
32,448
3,114,439 6,072,372
2,853,117
595,453 -
100,000
(509,873 (6,200
(6,400
85,580 (6,200
93,600
5,482,152
22,503,783
3,887,054
27,750
-
-
(1,287,420)
(16,094,296)
(4,608,879)
-
499,502
-
(2,056,306)
(378,817)
(127,374)
(638,238)
(292,039)
(85,593)
-
181,068
-
-
767,556
-
1,009,760
-
-
(101,751)
(428,205)
(71,720)
2,435,947
6,758,552
(1,006,512)
1,269,550
2,646,701
591,595
6,905,516
15,471,425
2,531,800
Balances, beginning 18,712,193 41,035,501 10,285,332
Balances, ending $ 25,617,709 $ 56,506,926 $ 12,817,132
Noncash investing, capital and financing activities:
The City received noncash capital contributions in the Water and Sewer Fund in the amount of
$2,918,184 representing donated capital assets.
The net book value of assets disposed in the Natural Gas Fund amounted to $26,448.
The notes to the financial statements are an integral part of this statement.
26
EXHIBIT 10,
Continued
Nonmajor
Enterprise
Funds Fund
Aquatics and
Fitness Center Airport Total
$ 3,955,484
$ 1,835,117
$ 79,492,143
(1,230,910)
(1,747,860)
(60,187,365)
(1,468,781)
(398,985)
(6,482,467)
-
-
621,891
-
-
(871,009)
167,136
43,107
621,043
1,422,929
(268,621)
13,194,236
-
368,568
1,064,021
(100,000)
-
(622,473)
(100,000)
368,568
441,548
- 13,095,000 44,967,989
- - 27,750
(65,398) (1,918,263) (23,974,256)
- - 499,502
(746,418) (34,604) (3,343,519)
(172,384) (89,496) (1,277,750)
- - 181,068
- - 767,556
- - 1,009,760
- - (601,676)
98( 4,200) 11,052,637 18,256,424
170,509
175,054
4,853,409
509,238
11,327,638
36,745,617
2,557,471
926,118
73,516,615
$ 3,066,709
$ 12,253,756
$ 110,262,232
27
CITY OF MONROE, NORTH CAROLINA
STATEMENT OF CASH FLOWS
PROPRIETARY FUNDS
For the Year Ended June 30, 2008
Major Enterprise
Water
and Sewer Electric Natural Gas
Reconciliation of operating income to net cash provided
by operating activities:
Operating income (loss) $ 979,192 $ 2,708,999 $ 1,988,546
Adjustments to reconcile operating income to
net cash provided by operating activities:
Depreciation and amortization
1,714,407
1,917,006
422,100
Other revenues
11,003
45,874
2,992
Changes in assets and liabilities:
(Increase) decrease in accounts receivable
218,339
(511,550)
(246,677)
(Increase) decrease in inventories
(360)
(282,208)
(15,555)
Increase (decrease) in accounts payable and accrued liabilities
194,553
2,366,215
734,049
Increase in customer deposits
(31,296)
(181,461)
(36,361)
Increase (decrease) in compensated absences
28,601
9,497
4,023
Total adjustments
2,135,247
3,363,373
864,571
Net cash provided (used) by operating activities
$ 3,114,439
$ 6,072,372
$ 2,853,117
The notes to the financial statements are an integral part of this statement.
28
Nonmajor
Enterprise
Funds Fund
Aquatics and
Fitness Center Airport Total
$ 1,146,739 $ (878,635) $ 5,944,841
256,261 524,017 4,833,791
- - 59,869
(39,147)
(18,303)
(597,338)
2,607
(38,348)
(333,864)
51,188
142,648
3,488,653
-
-
(249,118)
5,281
-
47,402
276,190
610,014
7,249,395
$ 1,422,929 $
(268,621)
$ 13,194,236
29
CITY OF MONROE, NORTH CAROLINA
NOTES TO THE FINANCIAL STATEMENTS
June 30, 2008
I. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
The accounting policies of the City of Monroe and its discretely presented component units conform to
generally accepted accounting principles as applicable to governments. The following is a summary of the
more significant accounting policies:
A. Reporting Entity
The City of Monroe is a municipal corporation that is governed by an elected mayor and a six- member
council. As required by generally accepted accounting principles, these financial statements present the
City and its component units, legally separate entities for which the City is financially accountable. The
discretely presented component units presented below are reported in a separate column in the City's
financial statements in order to emphasize that they are legally separate from the City.
City of Monroe ABC Board
The members of the City of Monroe ABC Board's governing board are appointed by the City. In addition,
the ABC Board is required by State statute to distribute a portion of its surpluses to the General Fund of the
City. The ABC Board, which has a June 30 year end, is presented as if it were a proprietary fund (discrete
presentation). Complete financial statements for the ABC Board may be obtained from the entity's
administrative offices at City of Monroe ABC Board, 1771 Dickerson Boulevard, Monroe, North Carolina
28110.
City of Monroe Tourism Development Authority
The members of the City of Monroe Tourism Development Authority's governing board are appointed by
the City. In addition, the Authority is required by its charter to distribute 67% of its net tax revenues to the
General Fund of the City for the purpose of tourism development. The Tourism Development Authority,
which has a June 30 year end, is presented as if it were a general government fund (discrete presentation).
Complete financial statements for the Authority may be obtained from the entity's administrative offices at
City of Monroe Tourism Development Authority, 300 West Crowell Street, Monroe, North Carolina
28112.
B. Basis of Presentation
Government -wide Statements: The statement of net assets and the statement of activities display
information about the primary government and its component units. These statements include the financial
activities of the overall government. Eliminations have been made to minimize the double counting of
internal activities. The statements distinguish between the governmental and business -type activities of the
City. Governmental activities generally are financed through taxes, intergovernmental revenues, and other
non - exchange transactions. Business -type activities are financed in whole or in part by fees charged to
external parties.
The statement of activities presents a comparison between direct expenses and program revenues for the
different business -type activities of the City and for each function of the City's governmental activities.
Direct expenses are those that are specifically associated with a program or function and, therefore, are
clearly identifiable to a particular function. Indirect expense allocations that have been made in the funds
have been reversed for the statement of activities. Program revenues include (a) fees and charges paid by
the recipients of goods or services offered by the programs and (b) grants and contributions that are
restricted to meeting the operational or capital requirements of a particular program. Revenues that are not
classified as program revenues, including all taxes, are presented as general revenues.
Fund Financial Statements: The fund financial statements provide information about the City's funds.
Separate statements for each fund category — governmental and proprietary — are presented. The emphasis
of fund financial statements is on major governmental and enterprise funds, each displayed in a separate
30
column. All remaining governmental and enterprise funds are aggregated and reported as nonmajor funds.
Proprietary fund operating revenues, such as charges for services, result from exchange transactions
associated with the principal activity of the fund. Exchange transactions are those in which each party
receives and gives up essentially equal values. Nonoperating revenues, such as subsidies result from non-
exchange transactions. Other nonoperating revenues are ancillary activities such as investment earnings.
The City reports the following major governmental fund:
General Fund. The General Fund is the general operating fund of the City. The General Fund accounts
for all financial resources except those that are required to be accounted for in another fund. The primary
revenue sources are ad valorem taxes, federal and State grants, and various other taxes and licenses. The
primary expenditures are for public safety, street maintenance and construction, sanitation services, culture
and recreation activities, and general government services.
The City reports the following major enterprise funds:
Water and Sewer Fund. This fund is used to account for the activities associated with the production,
distribution and transmission of potable water and the activities associated with operating and maintaining
the City's sewer and surface drainage systems.
Electric Fund. This fund is used to account for the activities associated with the distribution and
transmission of electricity by the City to its users.
Natural Gas Fund. This fund is used to account for the activities associated with the distribution of
natural gas by the City to its users.
Aquatics and Fitness Center Fund. This fund is used to account for the activities associated with the
operation of the City's Aquatics and Fitness Center.
C. Measurement Focus and Basis of Accounting
In accordance with North Carolina General Statutes, all funds of the City are maintained during the year
using the modified accrual basis of accounting.
Government -wide and Proprietary Fund Financial Statements. The government -wide and proprietary
financial statements are reported using the economic resources measurement focus. The government -wide
and proprietary fund financial statements are reported using the accrual basis of accounting. Revenues are
recorded when earned and expenses are recorded at the time liabilities are incurred, regardless of when the
related cash flows take place. Nonexchange transactions, in which the City gives (or receives) value
without directly receiving (or giving) equal value in exchange, include property taxes, grants, and
donations. On an accrual basis, revenue from property taxes is recognized in the fiscal year for which the
taxes are levied. Revenue from grants and donations is recognized in the fiscal year in which all eligibility
requirements have been satisfied.
Amounts reported as program revenues include 1) charges to customers or applicants for goods, services,
or privileges provided, 2) operating grants and contributions, and 3) capital grants and contributions,
including special assessments. Internally dedicated resources are reported as general revenues rather than
as program revenues. Likewise, general revenues include all taxes.
Proprietary funds distinguish operating revenues and expenses from nonoperating items. Operating
revenues and expenses generally result from providing services and producing and delivering goods in
connection with a proprietary fund's principal ongoing operations. The principal operating revenues of the
City enterprise funds are charges to customers for sales and services. The City also recognizes as operating
revenue the portion of fees intended to recover the cost of connecting new or reconnecting current
customers to the water and sewer system. Operating expenses for enterprise funds include the cost of sales
and services, administrative expenses and depreciation on capital assets. All revenues and expenses not
meeting this definition are reported as nonoperating revenues and expenses.
31
Governmental Fund Financial Statements. Governmental funds are reported using the current financial
resources measurement focus and the modified accrual basis of accounting. Under this method, revenues
are recognized when measurable and available. Expenditures are recorded when the related fund liability is
incurred, except for principal and interest on general long -term debt, claims and judgments, and
compensated absences, which are recognized as expenditures to the extent they have matured. General
capital asset acquisitions are reported as expenditures in governmental funds. Proceeds of general long-
term debt and acquisitions under capital leases are reported as other financing sources.
The City considers all revenues available if they are collected within 90 days after year -end, except for
property taxes. Ad valorem taxes receivable are not accrued as a revenue because the amount is not
susceptible to accrual. At June 30, taxes receivable are materially past due and are not considered to be an
available resource to finance the operations of the current year. Also, as of January 1, 1993, State law
altered the procedures for the assessment and collection of property taxes on registered motor vehicles in
North Carolina. Effective with this change in the law, Union County is responsible for billing and
collecting the property taxes on registered motor vehicles on behalf of all municipalities and special tax
districts in the County, including the City of Monroe. For motor vehicles registered under the staggered
system, property taxes are due the first day of the fourth month after the vehicles are registered. The billed
taxes are applicable to the fiscal year in which they become due. Therefore, the City's vehicle taxes for
vehicles registered in Union County from March 2007 through February 2008 apply to the fiscal year
ended June 30, 2008. Uncollected taxes that were billed during this period are shown as a receivable in
these financial statements and are offset by deferred revenues.
Sales taxes and certain intergovernmental revenues, such as the utilities franchise tax, collected and held by
the State at year -end on behalf of the City are recognized as revenue. Intergovernmental revenues and
sales and services are not susceptible to accrual because generally they are not measurable until received in
cash. Grant revenues which are unearned at year -end are recorded as unearned revenues. Under the terms
of grant agreements, the City funds certain programs by a combination of specific cost - reimbursement
grants, categorical block grants, and general revenues. Thus, when program expenses are incurred, there
are both restricted and unrestricted net assets available to finance the program. It is the City's policy to first
apply cost - reimbursement grant resources to such programs, followed by categorical block grants, and then
by general revenues.
As permitted by generally accepted accounting principles, the City, the City of Monroe ABC Board, and
the Monroe Tourism Authority have elected to apply only applicable FASB Statements and Interpretations
issued on or before November 30, 1989 that do not contradict GASB pronouncements in its accounting and
reporting practices for its proprietary operations.
D. Budgetary Data
The City's budgets are adopted as required by the North Carolina General Statutes. An annual budget is
adopted for all funds except those which operate under project ordinances. All annual appropriations lapse
at fiscal year -end. Project ordinances are adopted for the Capital Projects Funds, two Special Revenue
Project Funds, (the City Grant Programs Fund and the State Grant Programs Fund), and the Enterprise
Capital Projects Funds which are consolidated with their respective operating funds for reporting purposes.
All budgets are prepared using the modified accrual basis of accounting. Expenditures may not legally
exceed appropriations at the functional level for all annually budgeted funds and at the object level for the
multi -year funds. The City's department heads may make transfers of appropriations within a department.
Transfers of appropriations between departments require the approval of the City Manager. The legal level
of budgetary control is at the functional level for all annually budgeted funds, and any transfers of
appropriations between functions require the approval of the City Council. The legal level of budgetary
control is at the object level for the funds budgeted by project ordinance, and any transfers of
appropriations between objects require the approval of the City Council. The budget ordinance must be
adopted by July 1 of the fiscal year or the governing board must adopt an interim budget that covers that
time until the annual ordinance can be adopted.
32
E. Assets, Liabilities, and Fund Equity
Deposits and Investments
All deposits of the City, the ABC Board, and the Tourism Development Authority are made in board -
designated official depositories and are secured as required by State law [G.S. 159 -31]. The City, ABC
Board, and the Tourism Development Authority may designate, as an official depository, any bank or
savings association whose principal office is located in North Carolina. Also, the City, the ABC Board,
and the Tourism Development Authority may establish time deposit accounts such as NOW and
SuperNOW accounts, money market accounts, and certificates of deposit.
State law [G.S. 159- 30(c)] authorizes the City, the ABC Board, and the Tourism Development Authority to
invest in obligations of the United States or obligations fully guaranteed both as to principal and interest by
the United States; obligations of the State of North Carolina; bonds and notes of any North Carolina local
government or public authority; obligations of certain non - guaranteed federal agencies; certain high quality
issues of commercial paper and bankers' acceptances and the North Carolina Capital Management Trust
( NCCMT). The City's investments are reported at fair value as determined by quoted market prices. The
securities of the NCCMT — Cash Portfolio, a SEC - registered (2a -7) money market mutual fund, are valued
at fair values, which is the NCCMT's share price. The NCCMT — Term Portfolio's securities are valued at
fair value.
The City, the ABC Board, and the Tourism Development Authority's investments with a maturity of more
than one year at acquisition and non -money market investments are reported at fair value as determined by
quoted market prices. The securities of the NCCMT Cash Portfolio, a SEC - registered (2a -7) money
market mutual fund, are valued at fair value, which is the NCCMT's share price. The NCCMT Term
Portfolio's securities are valued at fair value. Money market investments that have a remaining maturity at
the time of purchase of one year or less are reported at amortized cost. Non - participating interest earning
investment contracts are reported at cost.
In accordance with State law, the City has invested in securities which are callable and which provide for
periodic interest rate increases in specific increments until maturity. These investments are reported at fair
value as determined by quoted market prices.
2. Cash and Cash Equivalents
The City pools money from several funds to facilitate disbursement and investment and to maximize
investment income. Therefore, all cash and investments are essentially demand deposits and are
considered cash and cash equivalents. The ABC Board and the Tourism Development Authority consider
all highly liquid investments (including restricted assets) with a maturity of three months or less when
purchased to be cash and cash equivalents.
Restricted Assets
The unexpended bond proceeds of various enterprise fund serial bonds and unexpended installment
financing obligations received by the City are classified as restricted for the enterprise fund and the general
fund because their use is completely restricted to the purpose for which the bonds and installment
obligations were issued. Customer deposits held by the City before any services are supplied are restricted
to the service for which the deposit was collected.
4. Ad Valorem Taxes Receivable
In accordance with State Law [G.S. 105 -347 and G.S. 159- 13(a)], the City levies ad valorem taxes on
property other than motor vehicles on July 1st, the beginning of the fiscal year. The taxes are due on
September 1st (lien date); however, interest does not accrue until the following January 6th. These taxes
are based on the assessed values as of January 1, 2007. As allowed by State law, the City has established a
schedule of discounts that apply to taxes that are paid prior to the due date. In the City's General Fund ad
valorem tax revenues are reported net of such discounts.
33
Allowance for Doubtful Accounts
Virtually all ad valorem taxes and accounts receivable are collected, and accordingly, an allowance for
uncollectible receivables is not considered material or necessary. An allowance for doubtful accounts has
been established for certain loans receivable that historically experience uncollectible accounts. The
allowance is estimated by analyzing the percentage of receivables that were written off in prior years.
6. Inventories
The inventories of the City and the ABC Board are valued at cost (first -in, first -out), which approximates
market. The inventories of the City's general fund and enterprise funds and those of the ABC Board
consist of materials and supplies held for subsequent use. The cost of these inventories is expensed when
consumed rather than when purchased.
7. Capital Assets
Capital assets are defined by the government as assets with an initial, individual cost of more than a certain
cost and an estimated useful life in excess of two years. Minimum capitalization costs are as follows: land,
$5,000; buildings, improvements, substations, lines, and other plant and distribution systems, $5,000;
infrastructure, $100,000; furniture and equipment, $5,000; and vehicles, $5,000. Purchased or constructed
capital assets are reported at cost or estimated historical cost. Donated capital assets are recorded at their
estimated fair value at the date of donation. General infrastructure assets acquired prior to July 1, 2003
consist of the road network assets that were acquired or that received substantial improvements subsequent
to July 1, 1980, and are reported at estimated historical cost using deflated replacement cost. The cost of
normal maintenance and repairs that do not add to the value of the asset or materially extend assets' lives
are not capitalized.
Capital assets are depreciated using the straight -line method over the following estimated useful lives:
Asset Class
Estimated
Useful Lives
Infrastructure
30-50
Buildings and Improvements
20-45
Dams and Reservoirs
45
Plants and Distributions Systems
30-60
Vehicles and Motorized Equipment
6 -12
Other Equipment
5 -15
Capital assets of the ABC Board are depreciated over their useful lives on a straight -line basis as follows:
Asset Class
Estimated
Useful Lives
Buildings 40
Office Equipment 5-7
Vehicles 5
Store and Warehouse Equipment 5-7
The Tourism Development Authority had no capital assets at June 30, 2008.
8. Deferred/Unearned Revenues
Governmental funds report deferred revenue in connection with receivables for revenues that are not
34
considered to be available to liquidate liabilities of the current period. Governmental funds also defer
revenue recognition in connection with resources received but not yet earned.
9. Long -Term Obligations
In the government -wide financial statements, and proprietary fund types in the fund financial statements,
long -term debt and other long -term obligations are reported as liabilities in the applicable governmental
activities, business -type activities, or proprietary fund type statement of net assets. Bond premiums and
discounts, as well as issuance costs, are deferred and amortized over the life of the bonds using the straight -
line method that approximates the effective interest method. Bonds payable are reported net of the
applicable bond premiums or discount. Bond issuance costs are reported as deferred charges and amortized
over the term of the related debt.
In fund financial statements, governmental fund types recognize bond premiums and discounts, as well as
bond issuance costs, during the current period. The face amount of debt issued is reported as other
financing sources. Premiums received on debt issuances are reported as other financing sources while
discounts on debt issuances are reported as other financing uses. Issuance costs, whether or not withheld
from the actual debt proceeds received, are reported as debt service expenditures.
10. Compensated Absences
The vacation policy of the City provides for the accumulation of earned vacation leave with such leave
being fully vested when earned as follows:
Employees hired before July 1, 1992
Vacation leave may be accumulated without any applicable maximum until June 30 each year. However, if
the employee separates from service, payment for accumulated vacation leave shall not exceed sixty (60)
days. On June 30 of each year, any employee with more than (60) days of accumulated leave shall have
the excess accumulation removed so that only sixty (60) days are carried forward to July 1 of the next
fiscal year. The remaining excess amount will be converted to sick leave and added to the employee's sick
leave balance.
Employees hired after July 1, 1992
Vacation leave may be accumulated without any applicable maximum until June 30 of each year.
However, if the employee separates from service, payment for accumulated vacation leave shall not exceed
two times the employee's annual accrual rate (i.e. if the accrual rate is 15 days per year, the employee may
only be paid for 30 days). On June 30 of each year, each employee may only carry over into the new fiscal
year two times the employee's annual accrual rate. The remaining excess amount will be converted to sick
leave and added to the employee's sick leave balance.
Employees of the City of Monroe ABC Board earn two weeks paid vacation each year. Employees must
take vacation leave in the year earned and are not allowed to carry forward any vacation time to subsequent
years.
The Tourism Development Authority had one employee during the year ended June 30, 2008.
For the City's government -wide and proprietary funds, an expense and a liability for compensated absences
and the salary- related payments are recorded as the leave is earned. The City has assumed a first -in, first -
out method of using accumulated compensated time. The portion of that time that is estimated to be used
in the next fiscal year has been designated as a current liability in the government -wide financial
statements.
The City and the ABC Board's sick leave policies provide for an unlimited accumulation of earned sick
leave. Sick leave does not vest, but any unused sick leave accumulated at the time of retirement may be
used in the determination of length of service for retirement benefit purposes. Since neither the City nor
the ABC Board has any obligation for the accumulated sick leave until it is actually taken, no accrual for
sick leave has been made.
35
11. Net Assets/Fund Balances
Net assets in government -wide and proprietary fund financial statements are classified as invested in
capital assets, net of related debt; restricted; and unrestricted. Restricted net assets represent constraints on
resources that are either externally imposed by creditors, grantors, contributors, or laws or regulations of
other governments or imposed by law through state statute.
In the governmental fund financial statements, reservations of fund balance represent amounts that cannot
be appropriated or are legally segregated for a specific purpose. Designations of fund balance represent
tentative management plans that are subject to change.
State law [G.S. 159- 13(b)(16)] restricts appropriation of fund balance for the subsequent year's budget to
an amount not to exceed the sum of cash and investments minus the sum of liabilities, encumbrances, and
deferred revenues arising from cash receipts as those amounts stand at the close of the fiscal year preceding
the budget year.
The governmental fund types classify fund balances as follows:
Reserved:
Reserved for encumbrances — portion of fund balance available to pay for commitments related to
purchase orders or contracts which remain unperformed at year end.
Reserved by State statute - portion of fund balance, in addition to reserves for encumbrances,
which is not available for appropriation under State law [G.S. 159- 8(a)]. This amount is usually
comprised of accounts receivable and interfund receivables which have not been offset by deferred
revenues.
Reserved for streets - Powell Bill - portion of fund balance that is available for appropriation but
legally segregated for street construction and maintenance expenditures. This amount represents
the balance of the total unexpended Powell Bill funds.
Unreserved:
Designated - portion of total fund balance available for appropriation that has been designated for
special purposes, such as:
Subsequent year's expenditures — designated for the adopted 2008 -2009 budget ordinance.
Self - insurance expenditures — designated to pay for unpaid claims under the self - funded insurance
plans.
Undesignated - portion of total fund balance available for appropriation that is uncommitted at
year -end.
12. Management 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 revenues and expenditures /expenses during the reporting period.
Actual results could differ from those estimates.
13. Other Resources
The General Fund provides the basis of local resources for other governmental funds. These transactions
are recorded as "Transfers — to other funds" in the General Fund and "Transfers — from other funds" in the
receiving fund.
36
II.
III.
STEWARDSHIP, COMPLIANCE AND ACCOUNTABILITY
Expenditures in the Airport Fund for operations exceeded budget appropriations by $95,389. Management
and the board will more closely review the budget reports to ensure compliance in future years.
RECONCILIATION OF GOVERNMENT -WIDE AND FUND FINANCIAL STATEMENTS
A. Explanation of certain differences between the governmental fund balance sheet and the
government -wide statement of net assets
The governmental fund balance sheet includes reconciliation between fund balance - total governmental
funds and net assets - governmental activities as reported in government -wide statement of net assets. One
element of that reconciliation explains that "long -term liabilities, including installment purchase
obligations, are not due and payable in the current period and therefore are not reported in the funds." The
details of this $9,948,476 difference are as follows:
Installment purchase obligations $ 7,821,435
Compensated absences 1,440,599
Self- insurance fund claims payable 686,443
Net adjustment to reduce fund balance - total governmental funds
to arrive at net assets - governmental activities $ 9,948,477
B. Explanation of certain differences between the governmental fund statement of revenues,
expenditures, and changes in fund balances and the government -wide statement of activities
The government fund statement of revenues, expenditures, and changes in fund balances includes
reconciliation between net change in fund balances - total governmental funds and change in net assets of
governmental activities as reported in the government -wide statement of activities. One element of that
reconciliation explains that "Governmental funds report capital outlays as expenditures. However, in the
statement of activities the cost of those assets is allocated over their estimated useful lives and reported as
depreciation expense." The details of this $3,729,520 difference are as follows:
Capital outlay
Depreciation expense
$ 7,770,630
(4,041,110)
Net adjustment to increase net change in fund balances - total governmental
funds to arrive at change in net assets ofgovernmental activities $ 3,729,520
Another element of that reconciliation states that "the issuance of long -term debt provides current financial
resources to governmental funds, while the repayment of the principal of long -term debt consumes the
current financial resources of governmental funds. Neither transaction has any effect on net assets." The
details of this ($1,671,367) are as follows:
Debt issued or incurred:
Installment purchase obligations
Principal payments:
Installment purchase obligations
$ (3,331,706)
1,660,339
Net adjustment to decrease net change in fund balances - total governmental
funds to arrive at change in net assets ofgovernmental activities $ ( 1,671,367)
37
IV. DETAIL NOTES ON ALL FUNDS
A. Assets
Deposits
All of the deposits of the City, the ABC Board, and the Tourism Development Authority are either insured
or collateralized by using one of two methods. Under the Dedicated Method, all deposits that exceed the
federal depository insurance coverage level are collateralized with securities held by the City's, the ABC
Board's, or the Tourism Development Authority's agents in these units' names. Under the Pooling
Method, which is a collateral pool, all uninsured deposits are collateralized with securities held by the State
Treasurer's agent in the name of the State Treasurer. Since the State Treasurer is acting in a fiduciary
capacity for the City, the ABC Board, and the Tourism Development Authority, these deposits are
considered to be held by the City's, the ABC Board's, and the Tourism Development Authority's agents in
their names. The amount of the pledged collateral is based on an approved averaging method for non-
interest bearing deposits and the actual current balance for interest bearing deposits. Depositories using the
Pooling Method report to the State Treasurer the adequacy of their pooled collateral covering uninsured
deposits. The State Treasurer does not confirm this information with the City, the ABC Board, the
Tourism Development Authority, or the escrow agent. Because of the inability to measure the exact
amount of collateral pledged for the City, the ABC Board, and the Tourism Development Authority under
the Pooling Method, the potential exists for under - collateralization, and this risk may increase in periods of
high cash flows. However, the State Treasurer of North Carolina enforces strict standards of financial
stability for each depository that collateralizes public deposits under the Pooling Method. The City, the
ABC Board and the Tourism Development Authority do not have formal policies regarding custodial credit
risk for deposits, but rely on the State Treasurer to enforce standards of minimum capitalization for all
pooling method financial institutions and to monitor them for compliance. The City, the ABC Board and
the Tourism Development Authority comply with the provisions of G.S. 159 -31 when designating official
depositories and verifying that deposits are properly secured.
At June 30, 2008 the City's deposits had a carrying amount of $9,304,440 and a bank balance of
$9,351,188. Of the carrying amount of $9,304,440, $1,989,232 was the amount of non - reimbursed
installment obligation issued during the year. In addition, there was $44,267,888 in an escrow account
with a trustee of unspent bond proceeds. Of the bank balance, $100,000 was covered by federal
depository insurance and the remainder was covered by collateral held under the Pooling Method. The
City's petty cash fund totaled $4,835.
At June 30, 2008 the ABC Board's deposits had a carrying amount of $651,793 and a bank balance of
$628,305. Of the bank balance, $100,000 was covered by federal depository insurance, and $528,305 was
covered by collateral held under the Pooling Method. The ABC Board's petty cash fund totaled $3,900.
At June 30, 2008, the Tourism Development Authority's deposits had a carrying amount of $152,675 and a
bank balance of $152,675. Of the bank balance, $100,000 was covered by federal depository insurance,
and $52,675 was covered by collateral held under the Pooling Method.
2. Investments
As of June 30, 2008, the City had the following investments and maturities:
Investment Type
U.S. Government Agencies
NC Capital Management Trust —
Cash Portfolio
NC Capital Management Trust —
Term Portfolio
Total
1 -3 3 -5
Fair Value 1 Year Years Years
$ 52,690,002 $ 5,088,011 $ 39,643,597 $ 7,958,394
25,029,583 N/A N/A N/A
311,145 311,145
$ 78,030,730
38
Interest Rate Risk. The City does not have a formal investment policy that limits investment maturities as a
means of managing its exposure to fair value losses arising from increasing interest rates.
Credit Risk. The City has no formal policy regarding credit risk, but has internal management procedures
that limits the City's investments to the provisions of G.S. 159 -30 and restricts the purchase of securities to
the highest possible ratings whenever particular types of securities are rated. The investment in U.S.
Government Agencies (Federal Home Loan Bank) is rated AAA by Standard and Poor's and Aaa by
Moody's Investors Service. The City's investment in the NC Capital Management Trust Cash Portfolio
carried a credit rating of AAAm by Standard and Poor's as of June 30, 2008. The City's investment in the
NC Capital Management Trust Term Portfolio is unrated. The Term Portfolio is authorized to invest in
obligations of the U.S. government and agencies, and in high grade money market instruments as permitted
under North Carolina General Statutes 159 -30 as amended.
Custodial Credit Risk. For an investment, the custodial risk is the risk that in the event of the failure of the
counterparty, the City will not be able to recover the value of its investments or collateral securities that are
in the possession of an outside party. The City has no policy on custodial credit risk.
Concentration of Credit Risk. The City's Board places no limit on the amount that the City may invest in
any one issuer. More than 5 percent of the City's investments are in Federal Home Loan Bank securities.
This investment is 32.8% of the City's total investments. In addition, the City had 32.1% of its investment
portfolio in the NCCMT — cash portfolio at June 30, 2008.
Note Receivable
The City granted a promissory note in the amount of $404,921 to an electric customer to reimburse the cost
and installation of equipment during the fiscal year 2006. The remaining balance of the promissory note is
payable in quarterly installments of $20,963 through August 2010. The note calls for interest to be paid
quarterly at the applicable prime rate. Principal collections on the note receivable for the fiscal year ended
totaled $83,853. The note is secured by equipment.
2008
Total Receivable $ 188,669
Less Current Portion 83,853
Total Note Receivable - Noncurrent $ 104,816
Scheduled future maturities of the note receivable are as follows:
2009 $ 83,853
2010 83,853
2011 20,963
$ 188,669
The City granted a promissory note in the amount of $1,730,070 to an electric customer to reimburse the
cost and installation of equipment during the fiscal year 2007. The remaining balance of the promissory
note is payable in monthly installments. Due to the nature of the terms agreed upon the payment amounts
will vary and are unpredictable. The monthly payment amount is determined as follows:
Each month electric charges will be calculated based on the LICPNC rate (LICPNC Bill) and
electric charges will be calculated based on the LICPNC rate assuming peak generation had not
been used (LICPNC Bill No Generation). The difference in these rate calculations (i.e. LICPNC
Bill No Generation — LICPNC Bill) will be used to fund the City's recovery of one half of the
installed cost of the generation. The customer's monthly bill will equal the LICPNC Bill plus one
half of the difference in the LICPNC Bill No Generation and the LICPNC Bill.
At the current rate of payment it is estimated that the note will be repaid in full during fiscal year 2013.
The agreement is non interest bearing and is secured by equipment.
39
2008
Total receivable $ 1,390,767
Current portion 339,303
Total Note Receivable — Noncurrent $ 1,051,464
Future payments of the note receivable can vary based on the customers electricity usage. The current
portion has been calculated based on payments received during the year ended June 30, 2008.
4. Receivables - Allowance for Doubtful Accounts
The amounts presented in the Balance Sheet and the Statement of Net Assets are net of the following
allowances for doubtful accounts:
Special Revenue Fund
Loans Receivable $ 25,096
5. Capital Assets
Primary Government
Capital asset activity for the primary government for the year ended June 30, 2008, was as follows:
Depreciation expense was charged to functions /programs of the primary government as follows:
General government $ 242,152
Transportation 2,328,793
Public safety 1,092,003
Culture and recreation 373,968
Economic and physical development 4,194
Total depreciation expense $ 4,041,110
40
Beginning
Ending
Balances
Increases
Decreases
Balances
Governmental activities:
Capital assets not being depreciated:
Land and land improvements
$ 4,184,540 $
- $
13,075
$ 4,171,465
Construction in progress
1,741,054
3,817,522
2,041,431
3,517,145
Total capital assets not being depreciated
5,925,594
3,817,522
2,054,506
7,688,610
Capital assets being depreciated:
Buildings and improvements
14,084,098
2,082,503
64,300
16,102,301
Equipment
3,499,160
171,371
20,300
3,650,231
Vehicles and motorized equipment
11,743,900
1,360,887
374,998
12,729,789
Infrastructure
80,931,563
2,379,778
424,449
82,886,892
Total capital assets being depreciated
110,258,721
5,994,539
884,047
115,369,213
Less accumulated depreciation for:
Buildings and improvements
5,864,260
392,821
55,970
6,201,111
Equipment
1,887,832
254,146
20,300
2,121,678
Vehicles and motorized equipment
6,769,327
1,380,925
369,489
7,780,763
Infrastructure
23,944,612
2,013,218
291,558
25,666,272
Total accumulated depreciation
38,466,031 $
4,041,110 $
737,317
41,769,824
Total capital assets being depreciated, net
71,792,690
73,599,389
Governmental activities capital assets, net
$ 77,718,284
$ 81,287,999
Depreciation expense was charged to functions /programs of the primary government as follows:
General government $ 242,152
Transportation 2,328,793
Public safety 1,092,003
Culture and recreation 373,968
Economic and physical development 4,194
Total depreciation expense $ 4,041,110
40
Beginning Ending
Business -type activities:
Water and Sewer Fund
Capital assets not being depreciated:
Land and land improvements $ 662,216 $ - $ - $ 662,216
Construction in progress 1,018,466 1,993,023 1,660,112 1,351,377
Total capital assets not being depreciated 1,680,682 1,993,023 1,660,112 2,013,593
Capital assets being depreciated:
Buildings and improvements
Equipment
Vehicles and motorized equipment
Infrastructure
Total capital assets being depreciated
Less accumulated depreciation for:
Buildings and improvements
Equipment
Vehicles and motorized equipment
Infrastructure
Total accumulated depreciation
22,879,384
-
- 22,879,384
2,131,307
398,106
- 2,529,413
2,814,464
49,169
- 2,863,633
49,696,570
3,425,415
- 53,121,985
77,521,725
3,872,690
- 81,394,415
Total capital assets not being depreciated
7,291,928 14,551,154
1,055,604 20,787,478
8,432,089
486,836
- 8,918,925
1,193,710
133,476
- 1,327,186
1,902,438
207,616
- 2,110,054
8,662,975
884,445
- 9,547,420
20,191,212
1,712,373
- 21,903,585
Total capital assets being depreciated, net 57,330,513
59,490,830
Water and Sewer Fund capital assets, net
59,011,195
61,504,423
Electric Fund
1,084,887
145,310
Capital assets not being depreciated:
1,432,265
21,804,879
Land and land improvements
4,408,506 -
- 4,408,506
Construction in progress
2,883,422 14,551,154
1,055,604 16,378,972
Total capital assets not being depreciated
7,291,928 14,551,154
1,055,604 20,787,478
Capital assets being depreciated:
Buildings and improvements
Equipment
Vehicles and motorized equipment
Infrastructure
Total capital assets being depreciated
Less accumulated depreciation for:
Buildings and improvements
Equipment
Vehicles and motorized equipment
Infrastructure
Total accumulated depreciation
Total capital assets being depreciated, net
Electric Fund capital assets, net
122,489 -
4,431,972 -
1,651,153 55,125
52,982,138 2,543,628
59,187,752 2,598,753
23,583
23,583
122,489
4,431,972
1,682,695
55,525,766
60,922
2,628
1,345,390
332,521
1,084,887
145,310
19,313,680
1,432,265
21,804,879
1,912,724
37,382,873
44,674,801
38,068,902
58,856,380
Natural Gas Fund
Capital assets not being depreciated:
Land and land improvements 69,580 - - 69,580
Construction in progress 731,006 4,144,776 219,622 4,656,160
Total capital assets not being depreciated 800,586 4,144,776 219,622 4,725,740
61,762, 922
63,550
- 1,677,911
23,583 1,206,614
- 20,745,945
23,583 23,694,020
41
Total capital assets being depreciated, net
7,692,267
7,598,880
Aquatics and Fitness Center Fund
capital assets, net
8,715,341
8,524,474
Airport Fund
Capital assets not being depreciated:
Land and land improvements 7,082,044 - - 7,082,044
Construction in progress 1,810,338 1,918,263 1,905,088 1,823,513
Total capital assets not being depreciated 8,892,382 1,918,262 1,905,088 8,905,557
Capital assets being depreciated:
Buildings and improvements 10,551,730
Equipment 80,181
Vehicles and motorized equipment 212,756
Total capital assets being depreciated 10,844,667
1,376,304 - 11,928,034
376,158 - 456,339
- - 212,756
1,752,462 - 12,597,129
E
Beginning
Ending
Balances
Increases
Decreases
Balances
Capital assets being depreciated:
Buildings and improvements
543,152
-
-
543,152
Equipment
229,763
6,669
-
236,432
Vehicles and motorized equipment
537,614
165,143
88,469
614,288
Infrastructure
14,975,380
516,003
13,200
15,478,183
Total capital assets being depreciated
16,285,909
687,815
101,669
16,872,055
Less accumulated depreciation for:
Buildings and improvements
90,394
11,939
-
102,333
Equipment
111,984
13,582
-
125,566
Vehicles and motorized equipment
396,077
38,177
57,984
376,270
Infrastructure
3,137,357
356,968
13,147
3,481,178
Total accumulated depreciation
3,735,812
420,666
71,131
4,085,347
Total capital assets being depreciated, net
12,550,097
12,786,708
Natural Gas Fund capital assets, net
13,350,683
17,512,448
Aquatics and Fitness Center Fund
Capital assets not being depreciated:
Land and land improvements
925,594
-
-
925,594
Construction in progress
97,480
87,722
185,202
-
Total capital assets not being depreciated
1,023,074
87,722
185,202
925,594
Capital assets being depreciated:
Buildings and improvements
9,223,228
162,875
-
9,386,103
Equipment
63,988
-
-
63,988
Vehicles and motorized equipment
12,280
-
-
12,280
Total capital assets being depreciated
9,299,496
162,875
-
9,462,371
Less accumulated depreciation for:
Buildings and improvements
1,578,922
250,329
-
1,829,251
Equipment
24,387
4,060
-
28,447
Vehicles and motorized equipment
3,920
1,873
-
5,793
Total accumulated depreciation
1,607,229
256,262
-
1,863,491
Total capital assets being depreciated, net
7,692,267
7,598,880
Aquatics and Fitness Center Fund
capital assets, net
8,715,341
8,524,474
Airport Fund
Capital assets not being depreciated:
Land and land improvements 7,082,044 - - 7,082,044
Construction in progress 1,810,338 1,918,263 1,905,088 1,823,513
Total capital assets not being depreciated 8,892,382 1,918,262 1,905,088 8,905,557
Capital assets being depreciated:
Buildings and improvements 10,551,730
Equipment 80,181
Vehicles and motorized equipment 212,756
Total capital assets being depreciated 10,844,667
1,376,304 - 11,928,034
376,158 - 456,339
- - 212,756
1,752,462 - 12,597,129
E
Beginning
Less accumulated depreciation for:
Buildings and improvements
Equipment
Vehicles and motorized equipment
Total accumulated depreciation
Total capital assets being depreciated, net
Airport Fund capital assets, net
Business -type activities capital assets, net
Construction commitments
4,719,080
463,324
51,421
28,341
50,810
29,299
4,821,311 $
520,964 $
6,023,356
1,297,334
14,915,738
14,675,758
$ 140,667,758
103,914
5,182,404
79,762
80,109
5,342,275
7,254,854
16,160,411
$ 162,558,136
The government has active construction projects as of June 30, 2008. At year end, the government's commitments
with contractors are as follows:
Projects
Governmental
Capital Projects
Enterprise
Aquatics and Fitness Center
Water and Sewer
Electric
Natural Gas
Airport
Total
Discretely presented component units
Spent -to- Remaining
Date Commitment
$ 3,517,146 $ 904,494
22,327
112,319
1,351,377
3,082,264
16,378,970
8,084,930
4,656,164
1,194,417
1,823,511
1,297,334
$ 27,749,495 $
14,675,758
Capital asset activity for the ABC Board for the year ended June 30, 2008, was as follows:
Capital assets not being depreciated:
Land and land improvements
Capital assets being depreciated:
Buildings and improvements
Equipment
Vehicles and motorized equipment
Total capital assets being depreciated
Less accumulated depreciation for:
Buildings and improvements
Equipment
Vehicles and motorized equipment
Total accumulated depreciation
Total capital assets being depreciated, net
Discretely Presented Component Unit
capital assets, net
Beginning
Ending
Balances
Increases Decreases
Balances
$ 317,013 $
- $ -
$ 317,013
1,020,104
- -
1,020,104
103,914
2,077 -
105,991
15,830
- -
15,830
1,139,848
2,077 -
1,141,925
229,810
25,904 -
255,714
73,627
8,902 -
82,529
15,830
- -
15,830
319,267
34,806 -
354,073
820,581
(32,729) -
787,852
$ 1,137,594 $
(32,729) $ -
$ 1,104,865
43
Ending
Decreases Balances
The Tourism Development Authority had no capital assets.
B. Liabilities
Accounts Payable and Accrued Liabilities
Payables at the government -wide level at June 30, 2008, were as follows:
Governmental activities:
General Fund
Nonmajor Funds
Total - governmental activities
Business -type activities:
Enterprise Funds
Salaries and
Vendors Benefits Other Total
$ 1,188,082 $ 335,607 $ - $ 1,523,689
187,143 - - 187,143
$ 1,375,225 $ 335,607 $ - $ 1,710,832
$ 8,148,188 $ - $ 178,815 $ 8,327,003
Component units' payables at June 30, 2008, were as follows:
Salaries
and
Vendors Benefits Other Total
ABC Board $ 380,848 $ - $ - $ 380,848
Tourism Development Authority $ - $ - $ 43 $ 43
2. Pension Plan Obligations
a. Local Governmental Employees' Retirement System
Plan Description. The City of Monroe and the ABC Board contribute to the statewide Local
Governmental Employees' Retirement System ( LGERS), a cost - sharing multiple - employer defined benefit
pension plan administered by the State of North Carolina. LGERS provides retirement and disability
benefits to plan members and beneficiaries. Article 3 of G.S. Chapter 128 assigns the authority to establish
and amend benefit provisions to the North Carolina General Assembly. The Local Governmental
Employees' Retirement System is included in the Comprehensive Annual Financial Report (CAFR) for the
State of North Carolina. The State's CAFR includes financial statements and required supplementary
information for LGERS. That report may be obtained by writing to the Office of the State Controller, 1410
Mail Service Center, Raleigh, North Carolina 27699 -1410, or by calling (919) 981 -5454.
Funding Policy. Plan members are required to contribute six percent of their annual covered salary. The
City and the ABC Board are required to contribute at an actuarially determined rate. For the City, the
current rate for employees not engaged in law enforcement and for law enforcement officers is 4.89% and
4.86 %, respectively, of annual covered payroll. For the ABC Board, the current rate for employees not
engaged in law enforcement is 5.02% of annual covered payroll. The contribution requirements of
members and of the City of Monroe and the ABC Board are established and may be amended by the North
Carolina General Assembly.
The City's contributions to LGERS for the years ended June 30, 2008, 2007, and 2006, were $990,287,
$929,488, and $856,115, respectively. The ABC Board's contributions to LGERS for the years ended June
30, 2008, 2007, and 2006 were $15,096, $14,892, and $15,223, respectively. The contributions made by
the City and the ABC Board equaled the required contributions for each year.
b. Law Enforcement Officers' Special Separation Allowance
1. Plan Description.
The City of Monroe administers a public employee retirement system (the "Separation Allowance "), a
single - employer defined benefit pension plan that provides retirement benefits to the City's qualified sworn
law enforcement officers. The Separation Allowance is equal to .85 percent of the annual equivalent of the
44
base rate of compensation most recently applicable to the officer for each year of creditable service. The
retirement benefits are not subject to any increases in salary or retirement allowances that may be
authorized by the General Assembly. Article 12D of G.S. Chapter 143 assigns the authority to establish
and amend benefit provisions to the North Carolina General Assembly.
All full time law enforcement officers of the City are covered by the Separation Allowance. At December
31, 2006, the Separation Allowance's membership consisted of:
Retirees receiving benefits 13
Terminated plan members entitled to
but not yet receiving benefits -
Active plan members 80
Total 93
A separate report was not issued for the plan.
2. Summary of SignificantAccounting Policies
Basis of Accounting. The City has chosen to fund the Separation Allowance on a pay as you go basis.
Pension expenditures are made from the General Fund, which is maintained on the modified accrual basis
of accounting.
Method Used to Value Investments. No funds are set aside to pay benefits and administration costs. These
expenditures are paid as they come due.
3. Contributions.
The City is required by Article 12D of G. S. Chapter 143 to provide these retirement benefits and has
chosen to fund the benefit payments on a pay as you go basis through appropriations made in the General
Fund operating budget. The City's obligation to contribute to this plan is established and may be amended
by the North Carolina General Assembly. There were no contributions made by employees.
The annual required contribution for the current year was determined as part of the December 31, 2006
actuarial valuation using the projected unit credit actuarial cost method. The actuarial assumptions
included (a) 7.25% investment rate of return (net of administrative expenses) and (b) projected salary
increases of 4.5% to 12.3% per year. Both (a) and (b) included an inflation component of 3.75 %. The
assumptions did not include post - employment benefit increases. The unfunded actuarial accrued liability is
being amortized as a level percentage of pay on a closed basis. The remaining amortization period at
December 31, 2006 was 24 years.
Annual Pension Cost and Net Pension Obligation. The City's annual pension cost and net pension
obligation (prepayment) to the Separation Allowance for the current year were as follows:
Annual required contribution
$ 143,756
Interest on net pension obligation
(8,526)
Adjustment to annual required contribution
7,227
Annual pension cost
142,457
Contributions made
154,184
Decrease in net pension obligation
(11,727)
Net pension obligation, beginning of year
(117,604)
Net prepaid pension obligation, end of year
$ (129,331)
45
3 Year Trend Information
For Year
Annual Pension
Ended
Cost
Tune 30
(APC)
2006
$ 138,276
2007
134,652
2008
142,457
4. Funded Status and Funding Progress
Percentage of
Net Pension
APC
Obligation
Contributed
(Prepayment)
142.55%
$ (65,249)
138.88%
(117,604)
108.23%
(129,331)
As of December 31, 2007, the most recent actuarial valuation date, the plan was not funded. The actuarial
accrued liability for benefits and the unfunded actuarial accrued liability (UAAL) was $1,650,670. The
covered payroll (annual payroll of active employees covered by the plan) was $3,761,162, and the ratio of
the UAAL to the covered payroll was 43.89 %.
Supplemental Retirement Income Plan
(1) Law Enforcement Officers
Plan Description. The City contributes to the Supplemental Retirement Income Plan (Plan), a defined
contribution pension plan administered by the Department of State Treasurer and a Board of Trustees. The
Plan provides retirement benefits to law enforcement officers employed by the City. Article 5 of G.S.
Chapter 135 assigns the authority to establish and amend benefit provisions to the North Carolina General
Assembly.
Funding Policy. Article 12E of G. S. Chapter 143 requires the City to contribute each month an amount
equal to five percent of each officer's salary, and all amounts contributed are vested immediately. Also,
the law enforcement officers may make voluntary contributions to the plan. Contributions for the year
ended June 30, 2008, were $266,656 which consisted of $197,674 from the City and $68,982 from the law
enforcement officers.
(2) General Employees
The City has elected to contribute to the Supplemental Retirement Income Plan for general employees as
well as for law enforcement officers. Participation begins after six months of employment. The City has
elected to contribute each month an amount equal to five percent of each employee's salary, and all
amounts contributed are vested immediately. Also, the employees may make voluntary contributions to the
plan. Contributions for the year ended June 30, 2008, were $1,154,781, which consisted of $795,304 from
the City and $359,477 from the employees.
d. Firemen's and Rescue Squad Workers' Pension Fund
Plan Description. The State of North Carolina contributes, on behalf of the City of Monroe, to the
Firemen's and Rescue Squad Workers' Pension Fund (Fund), a cost - sharing multiple- employer defined
benefit pension plan with a special funding situation administered by the State of North Carolina. The
Fund provides pension benefits for eligible fire and rescue squad workers that have elected to become
members of the fund. Article 86 of G.S. Chapter 58 assigns the authority to establish and amend benefit
provisions to the North Carolina General Assembly. The Firemen's and Rescue Squad Workers' Pension
Fund is included in the Comprehensive Annual Financial Report (CAFR) for the State of North Carolina.
The State's CAFR includes financial statements and required supplementary information for the Fund.
That report may be obtained by writing to the Office of the State Controller, 1410 Mail Service Center,
Raleigh, North Carolina 27699 -1410, or by calling (919) 981 -5454.
Funding Policy. Plan members are required to contribute $10 per month to the Fund. The State, a non-
employer contributor, funds the plan through appropriations. The City does not contribute to the Fund.
Contribution requirements of plan members and the State of North Carolina are established and may be
amended by the North Carolina General Assembly.
Ero
On- Behalf Payments. For the fiscal year ended June 30, 2008, the City of Monroe has recognized on-
behalf payments for pension contributions made by the state as a revenue and an expenditure of $11,804
for the 46 employed firemen who perform firefighting duties for the City's fire department. The employees
elected to be members of the Firemen and Rescue Squad Worker's Pension Fund.
Other Post - employment Benefits
According to a City resolution, the City provides post - employment health care benefits to retirees of the
City, provided they participate in the North Carolina Local Governmental Employees' Retirement System
(System) and have at least 20 years of creditable service with the City. The amount the City pays towards
these benefits is based on years of service with the City. At 20 and 25 years of service, the City pays 50%
and 75% of the cost of health and dental insurance, respectively. With 30 years of service, the City pays
100% of the cost of health and dental insurance. In addition, retirees with 30 years of service receive
$5,500 of life insurance coverage. When a retiree reaches age 65, they are transferred to the Medicare
Supplement Group Plan and Part D Group Plan at the above - referenced percentage of cost based on years
of service. At that time, any dependents covered are offered COBRA coverage. Currently, 65 retirees are
eligible for post - employment health benefits. For the fiscal year ended June 30, 2008, the City made
payments for post - employment benefit premiums of $263,310. The City obtains health care coverage
through private insurers.
Other Employment Benefits
The City elected to provide death benefits to employees through the Death Benefit Plan for members of the
Local Governmental Employees' Retirement System (Death Benefit Plan), a multiple - employer, State -
administered, cost - sharing plan funded on a one -year term cost basis. The beneficiaries of those employees
who die in active service after one year of contributing membership in the System, or who die within 180
days after retirement or termination of service and have at least one year of contributing membership
service in the System at the time of death are eligible for death benefits. Lump sum death benefit payments
to beneficiaries are equal to the employee's 12 highest months salary in a row during the 24 months prior to
the employee's death, but the benefit may not exceed $50,000 or be less than $25,000. All death benefit
payments are made from the Death Benefit Plan. The City has no liability beyond the payment of monthly
contributions. Contributions are determined as a percentage of monthly payroll, based upon rates
established annually by the State. Separate rates are set for employees not engaged in law enforcement and
for law enforcement officers. Because the benefit payments are made by the Death Benefit Plan and not by
the City, the City does not determine the number of eligible participants. For the fiscal year ended June 30,
2008, the City made contributions to the State for death benefits of $20,233. The City's required
contributions for employees not engaged in law enforcement and for law enforcement officers represented
.09% and .14% of covered payroll, respectively. The contributions to the Death Benefit Plan cannot be
separated between the post - employment benefit amount and the other benefit amount. The City considers
these contributions to be immaterial.
4. Deferred/Unearned Revenues
The balance in deferred or unearned revenue on the fund statements and unearned revenues on the
government -wide statements at year end is composed of the following elements:
Deferred Unearned
Revenue Revenue
Property taxes receivable
General
$ 823,857
Nonmajor governmental
1,292
Privilege license receivable:
General
59,946
Loans receivable:
Nonmajor governmental
21,379
Special vehicle tax receivable:
General
33,099
EIil
Deferred Unearned
Revenue Revenue
Code enforcement liens receivable:
General 30,507 -
Prepaid taxes and licenses:
General - 329,965
Total $ 970,080 $ 329,965
Risk Management
The City is exposed to various risks of loss related to torts; theft of, damage to, and destruction of assets;
errors and omissions; injuries to employees; and natural disasters. The City is self - funded with regard to
group health and workers' compensation insurance coverages. There have been no significant reductions
in insurance coverage from the prior year, and settled claims have not exceeded coverage in any of the past
three fiscal years.
A liability for a claim is established if information indicates that it is probable that a liability has been
incurred at the date of the financial statements and the amount of the loss is reasonably estimable.
Liabilities include an amount for claims that have been incurred but not reported (IBNRs). The result of the
process to estimate the claims liability is not an exact amount as it depends on many complex factors, such
as inflation, changes in legal doctrines, and damage awards. Accordingly, claims are reevaluated
periodically to consider the effects of inflation, recent claim settlement trends (including frequency and
amount of pay outs), and other economic and social factors. The estimate of the claims liability also
includes amounts for incremental claim adjustment expenses related to specific claims and other claim
adjustment expenses regardless of whether allocated to specific claims.
Flood Insurance
The City carries flood insurance for properties located in Flood Zones B, C and X through participation in
the North Carolina League of Municipalities Interlocal Risk Financing Fund of North Carolina. The City
does not have properties of significant value in these Flood Zones.
Self- Funded Insurance
Group Health Insurance
Effective July 1, 2002, the City established an employee medical benefit plan to self- insure claims up to
$50,000 per year for each individual covered; claims above $50,000 and aggregate claims exceeding 125%
of expected incurred and paid claims are covered by a stop loss insurance policy.
Workers' Compensation Insurance
The City has a self- funded workers' compensation insurance plan. Through this plan the City has workers'
compensation coverage of up to the statutory limits. The self- insurance plan has a $350,000 retained risk
per occurrence with a $1,000,000 aggregate limit. The City also carries employer's liability coverage with
similar retention and limit amounts.
Changes in the balance of claims liabilities during the year ended June 30, 2008 are as follows:
2008
Unpaid Claims, beginning of year $ 837,980
Incurred claims (including claims incurred but not
reported as of June 30):
Provision for current year events where the
City has retained risk of loss 3,466,243
Ell
2008
Increase in provision for prior years' events where
the City has retained risk of loss 408,640
Total Incurred Claims 4,712,863
Payments:
Claims attributable to current -year events where
the City has retained risk of loss
2,897,244
Claims attributable to prior years' events where
the City has retained risk of loss
836,951
Total Payments
3,734,195
Unpaid Claims, end of year
$ 978,668
Distribution:
Current portion of long -term liabilities on statement
of net assets
$ 686,443
Liability on General Fund balance sheet
292,225
$ 978,668
The City protects itself from potential loss through participation in the North Carolina League of
Municipalities Interlocal Risk Financing Fund of North Carolina for general liability, automobile liability,
public officials and law enforcement liability. The City maintains coverage of $5,000,000 for
comprehensive general liability, automobile liability, public officials and law enforcement liability. The
City's potential loss for liability coverage is limited to the deductible amount of $50,000 per claim for all
coverage except for real and personal property which has a deductible of $25,000 per claim.
In accordance with G.S. 159 -29, the City's employees that have access to $100 or more at any given time
of the City's funds are performance bonded through a commercial surety bond. The finance officer and tax
collector are each individually bonded for $250,000 each. The remaining employees that have access to
funds are bonded under a blanket bond for $250,000.
The City of Monroe ABC Board is exposed to various risks of loss related to torts; theft of, damage to, and
destruction of assets; errors and omissions; and natural disasters. The ABC Board has property, general
liability, automobile liability, workers compensation, and employee health coverage. The ABC Board also
has liquor legal liability coverage. There have been no significant reductions in insurance coverage from
the prior year, and settled claims have not exceeded coverage in any of the past three fiscal years.
The Tourism Development Authority is exposed to various risks of loss related to torts; theft of, damage to,
and destruction of assets; errors and omissions; and natural disasters. The Authority does not carry
commercial insurance to cover these risks of loss. All risk management activities are reported in the
Authority's General Fund. Claims expenditures and liabilities are reported when it is probable that a loss
has occurred and the amount of that loss can be reasonably estimated. Based on available information, the
Authority had no liability claims at June 30, 2008.
6 Claims, Judgements, and Contingent Liabilities
At June 30, 2008, the City was a defendant to various lawsuits. In the opinion of the City's management
and the City attorney, the ultimate effect of these legal matters will not have a material adverse effect on
the City's financial position.
7. Long -Term Obligations
a. Installment Purchase Obligations
The City has entered into various installment purchase obligations to acquire certain equipment and to
finance building improvements:
EL]
Governmental Enterprise
Funds Funds Total
Executed December 17, 1996, and refinanced on
December 20, 1998 to finance the construction of
an aquatics and fitness center, requiring 26 semi-
annual installments of $223,075 including interest
at 4.48 %. $
Executed April 23, 1999, to finance construction
of an addition to the aquatics and fitness center,
requiring 26 semi - annual installments of $54,180
including interest at 4.48 %.
Executed September 22, 1999, and refinanced on
May 19, 2004, to finance acquisition, renovation,
and furnishing of a police headquarters, requiring
21 semi - annual installments of $73,429 plus
interest at 2.80 %.
Executed December 22, 2003, to finance
construction of an addition to the aquatics and
fitness center, requiring 20 semi - annual
installments of $182,145 including interest at
3.85 %.
Executed June 11, 2004, to finance equipment,
requiring 10 semi - annual installments of $206,140
plus interest at 2.74 %.
Executed August 12, 2004, to finance construction
of a street maintenance building, requiring 30
semi - annual installments of $34,533 plus interest
at 3.89 %.
Executed June 24, 2005, to finance equipment,
requiring 10 semi - annual installments of $229,883
including interest at 3.07 %.
Executed January 30, 2006 to finance equipment,
requiring 36 monthly installments of $2,303
including interest at 3.00 %.
Executed June 15, 2006, to finance equipment,
requiring 10 semi - annual installments of $245,203
including interest at 3.81 %.
Executed June 15, 2007, to finance equipment,
requiring 10 semi - annual installments of $132,518
including interest at 3.8333 %.
Executed February 8, 2008, to finance facility
improvements, requiring 20 semi - annual
installments of $95,000 plus interest at 3.827 %.
Executed June 20, 2008, to finance equipment,
requiring 10 semi - annual installments of $216,651
including interest at 3.19 %.
- $ 1,430,516 $ 1,430,516
347,442 347,442
954,571 - 954,571
- 1,790,254 1,790,254
325,520 93,748 419,268
794,267 - 794,267
609,464
276,384 885,848
18,199
- 18,199
1,017,757
360,757 1,378,514
769,952
204,670 974,622
1,900,000
- 1,900,000
1,431,706
556,774 1,988,480
$ 7,821,436 $ 5,060,545 $ 12,881,981
50
Annual debt service payments of the installment purchase obligations as of June 30, 2008, are as follows:
b. General Obligation Indebtedness
The City's general obligation bonds issued to finance the construction of facilities utilized in the operations
of the water and sewer system and which are being retired by its resources are reported as long -term debt
in the Water and Sewer Fund. All general obligation bonds are collateralized by the full faith, credit, and
taxing power of the City. Principal and interest requirements are appropriated when due.
Bonds payable at June 30, 2008, are comprised of the following issue:
Serviced by the Water and Sewer Fund:
$6,330,000 1998 Water and Sewer Refunding Bonds due annually in
amounts ranging from $140,000 to $750,000 through March 1, 2010;
interest rate varying between 3.3% and 5.0 %. The amount shown is
net of the unamortized deferred loss on the defeasance of $10,848. $ 779,152
Annual debt service requirements to maturity for general obligation bonds are as follows:
Year Ending
June 30
Business -Type Activities
Principal Interest
2009 $ 650,000 $ 38,240
2010 140,000 5,740
Total $ 790,000 $ 43,980
The debt service requirements as presented above, have not been reduced by $10,848, the unamortized
deferred loss incurred as a result of the advance refundings.
At June 30, 2008, the City had a legal debt margin of $206,209,775.
C. Revenue Bonds
The City also issues bonds where it pledges income derived from the acquired or constructed assets to pay
debt service. Revenue bonds outstanding at year end are as follows:
51
Governmental Activities
Business -Type
Activities
Year Ending June 30
Principal
Interest
Principal
Interest
2009 $
1,825,896 $
257,201 $
1,276,468
$ 186,777
2010
1,520,075
198,342
1,230,130
137,441
2011
1,240,325
147,703
1,134,753
89,370
2012
904,916
106,975
774,502
44,028
2013
711,004
77,438
465,990
19,624
2014 -2018
1,515,619
163,241
178,702
3,440
2019 -2023
103,601
4,030
-
-
Total $
7,821,436
$
5,060,545
Total interest
payments
$
954,930
$ 480,680
b. General Obligation Indebtedness
The City's general obligation bonds issued to finance the construction of facilities utilized in the operations
of the water and sewer system and which are being retired by its resources are reported as long -term debt
in the Water and Sewer Fund. All general obligation bonds are collateralized by the full faith, credit, and
taxing power of the City. Principal and interest requirements are appropriated when due.
Bonds payable at June 30, 2008, are comprised of the following issue:
Serviced by the Water and Sewer Fund:
$6,330,000 1998 Water and Sewer Refunding Bonds due annually in
amounts ranging from $140,000 to $750,000 through March 1, 2010;
interest rate varying between 3.3% and 5.0 %. The amount shown is
net of the unamortized deferred loss on the defeasance of $10,848. $ 779,152
Annual debt service requirements to maturity for general obligation bonds are as follows:
Year Ending
June 30
Business -Type Activities
Principal Interest
2009 $ 650,000 $ 38,240
2010 140,000 5,740
Total $ 790,000 $ 43,980
The debt service requirements as presented above, have not been reduced by $10,848, the unamortized
deferred loss incurred as a result of the advance refundings.
At June 30, 2008, the City had a legal debt margin of $206,209,775.
C. Revenue Bonds
The City also issues bonds where it pledges income derived from the acquired or constructed assets to pay
debt service. Revenue bonds outstanding at year end are as follows:
51
Serviced by the Water and Sewer Fund, Electric Fund, Airport Fund and
Natural Gas Fund:
$5,195,000 Combined Enterprise System Revenue Bonds, Series 1998,
due annually in amounts ranging from $45,000 to $335,000 through
March 1, 2023, interest rate varying between 3.3% and 4.6 %. The
amount shown is net of the unamortized deferred loss on the defeasance
of $107,796. $ 3,662,204
$6,525,000 Combined Enterprise System Refunding Revenue Bonds,
Series 1998, due annually in amounts ranging from $40,000 to $675,000
through March 1, 2019, interest rate varying between 3.3% and 4.6 %.
The amount shown is net of the unamortized deferred loss on the
defeasance of $135,370. 5,889,630
$30,920,000 Combined Enterprise System Revenue Bonds, Series
2008A, due annually in amounts ranging from $765,000 to $2,055,000
through March 1, 2033, interest rate varying between 4.0% and 5.0 %. 30,920,000
$13,095,000 Combined Enterprise System Revenue Bonds, Series
2008B, due annually in amounts ranging from $450,000 to $1,005,000
through March 1, 2028, interest rate of 4.5404 %. 13,095,000
$ 53,566,834
The future payments of the revenue bonds for the years ending June 30, are as follows:
The future payments as presented above, have not been reduced by $243,166, the unamortized deferred
loss incurred as a result of the advance refundings.
The City has been in compliance with the covenants as to rates, fees, rentals, and charges in Section 704 of
the Bond Order Authorizing the Issuance of Combined Enterprise System Revenue Bonds (Bond Order)
since its adoption on May 3, 1994. Section 704(a) of the Bond Order requires the debt service coverage
ratio to be no less than 125 %. The debt service converage ratio calculation for the year ended June 30,
2008, is as follows:
Operating revenues $ 76,488,888
Operating expenses (1) 67,113,256
Operating income 9,375,632
Nonoperating revenues (2) 4,682,900
52
Business -Type
Activities
Year Ending
June 30
Principal
Interest
2009
$ 625,000
$ 2,417,767
2010
1,865,000
2,392,767
2011
1,945,000
2,315,085
2012
2,015,000
2,233,385
2013
2,100,000
2,148,037
2014-2018
11,960,000
9,303,142
2019-2023
11,870,000
6,569,156
2024— 2028
12,050,000
3,930,390
2029 -2033
9,380,000
1,380,675
Total
$ 53,810,000
$ 32,690,404
The future payments as presented above, have not been reduced by $243,166, the unamortized deferred
loss incurred as a result of the advance refundings.
The City has been in compliance with the covenants as to rates, fees, rentals, and charges in Section 704 of
the Bond Order Authorizing the Issuance of Combined Enterprise System Revenue Bonds (Bond Order)
since its adoption on May 3, 1994. Section 704(a) of the Bond Order requires the debt service coverage
ratio to be no less than 125 %. The debt service converage ratio calculation for the year ended June 30,
2008, is as follows:
Operating revenues $ 76,488,888
Operating expenses (1) 67,113,256
Operating income 9,375,632
Nonoperating revenues (2) 4,682,900
52
Income available for debt service 14,058,532
Debt service (3) 3,702,467
Debt service coverage ratio 380%
(1) Per rate covenants, this does not include the depreciation expense of $4,345,270.
(2) Per rate covenants, this includes investment earnings only.
(3) Per rate covenants, this does not include amortization of the deferred loss incurred as a
result of advance refundings.
The City has pledged future water and sewer, electric, airport, and natural gas customer revenues, net of
specified operating expenses, to repay $55.7 million in revenue bonds issued in 1998 and 2008. Proceeds
from the bonds provided financing for various capital projects. The bonds are payable solely from the
revenue sources of the enterprise funds noted above and are payable through 2033. Annual principal and
interest payments on the bonds are expected to require less than 6% of net revenues. The total principal
and interest remaining to be paid on the bonds is $86,500,404. Principal and interest paid for the current
year and total customer net revenues were $1,334,038 and $76.5 million, respectively.
d. Advance Refundings
On October 27, 1998, the City issued $6,330,000 in General Obligation Refunding Bonds with interest
rates ranging from 3.3% to 5.0% to advance refund $5,925,000 of outstanding 1991 Water and Sewer
general obligation bonds with interest rates ranging from 6.10% to 6.25 %. On October 27, 1998, the City
also issued $6,525,000 in Combined Enterprise System Refunding Revenue Bonds with interest rates
ranging from 3.3% to 4.6% to advance refund $5,715,000 of outstanding 1994 Combined Enterprise
System Revenue Bonds with interest rates ranging from 4.2% to 6.0 %. The net proceeds of $12,662,391
were used to purchase U.S. Government securities. Those securities were deposited in an irrevocable trust
with an escrow agent to provide for all future debt service payments on the 1991 Water and Sewer Serial
Bonds and the portion of the 1994 Combined Enterprise System Revenue Bonds which were refunded. As
a result, these bonds are considered to be defeased, and the liability for all the 1991 Water and Sewer serial
bonds and the 1994 Combined Enterprise System Revenue Bonds which were refunded have been
removed from the Enterprise Funds. At June 30, 2008 none of the 1991 bonds were outstanding. The
1994 Combined Enterprise System Revenue Bonds were fully retired in fiscal year 2008.
The advance refundings resulted in a difference between the reacquisition price and the net carrying
amount of the old debt of $1,022,391. This difference, net of the accumulated amortization of $768,377, is
reported in the accompanying financial statements as a deduction from bonds payable and is being charged
to operations through the year 2019 using the effective interest method over the life of the new debt which
is shorter than the life of the refunded debt. The bond issuance costs associated with the advance refunding
were expensed during the period incurred because they were not considered to be material. The City
completed the advance refundings to reduce its total debt service payments over the next 21 years by
$841,061 and to obtain an economic gain (difference between the present values of the old and new debt
service payments) of $615,185.
State Revolving Loans
The City has entered into six State Revolving Loans to finance water and sewer improvements. All State
Revolving Loans are being serviced by revenues from the Water and Sewer Fund:
Loan payable to the State of North Carolina Water
Pollution Control Revolving Loan Fund with a maximum
limit of $7,382,765 payable over 20 years with interest at
3.385 %. $ 2,583,968
53
Loan payable to the State of North Carolina Water
Business -Type
Pollution Control Revolving Loan Fund with a maximum
Year Ending
limit of $3,735,210 payable over 20 years with interest at
556,774 1,266,443
2.89 %.
1,120,563
Loan payable to the State of North Carolina Water Bond
2009 $
Loan Fund with a maximum limit of $1,515,662 payable
202,790
over 20 years with interest at 5.85 %.
606,265
Loan payable to the State of North Carolina Water Bond
2011
Loan Fund with a maximum limit of $1,484,338 payable
145,855
over 20 years with a revised interest rate of 3.43%
827,077
effective May 1, 2003 (previous rate was 5.30 %).
593,735
Loan payable to the State of North Carolina Water
88,861
Pollution Control Revolving Loan Fund with a maximum
1,796,524
limit of $1,159,030 payable over 20 years with interest at
Total $
3.035 %.
521,563
Loan payable to the State of North Carolina Water
Liabilities
Pollution Control Revolving Loan Fund with a maximum
limit of $1,270,105 payable over 20 years with interest at
Current
2.89 %.
505,815
$
5,931,909
Annual debt service requirements to maturity for the State Revolving Loans are as follows:
Governmental activities:
Installment purchase obligations
Compensated absences
Self - insurance fund claims payable
Governmental activities long -term liabilities
Business -type activities:
Compensated absences
Installment purchase obligations
General obligation bonds
Less deferred amount for loss on defeasance
Total general obligation bonds
$ 6,150,068 $ 3,331,706 $ 1,660,339 $ 7,821,435 $ 1,825,896
1,313,294 1,022,825 895,520 1,440,599 965,201
593,202 3,827,435 3,734,194 686,443 686,443
$ 8,056,564 $ 8,181,966 $ 6,290,053 $ 9,948,477 $ 3,477,540
$ 334,678 $
Business -Type
Activities
Year Ending
5,770,214
556,774 1,266,443
June 30
Principal
Interest
2009 $
827,077 $
202,790
2010
827,077
174,243
2011
827,077
145,855
2012
827,077
117,508
2013
827,077
88,861
2014-2017
1,796,524
103,182
Total $
5,931,909 $
832,439
f. Changes in Long -term
Liabilities
Current
Balance
Balance Portion of
July 1, 2007
Increases Decreases June 30, 2008 Balance
Governmental activities:
Installment purchase obligations
Compensated absences
Self - insurance fund claims payable
Governmental activities long -term liabilities
Business -type activities:
Compensated absences
Installment purchase obligations
General obligation bonds
Less deferred amount for loss on defeasance
Total general obligation bonds
$ 6,150,068 $ 3,331,706 $ 1,660,339 $ 7,821,435 $ 1,825,896
1,313,294 1,022,825 895,520 1,440,599 965,201
593,202 3,827,435 3,734,194 686,443 686,443
$ 8,056,564 $ 8,181,966 $ 6,290,053 $ 9,948,477 $ 3,477,540
$ 334,678 $
324,768 $ 277,366 $
382,080 $
255,992
5,770,214
556,774 1,266,443
5,060,545
1,276,468
1,450,000
- 660,000
790,000
650,000
28,419
- 17,571
10,848
-
1,421,581
- 642,429
779,152
650,000
54
Revenue bonds
Less deferred amount for loss on defeasance
Total revenue bonds
State revolving loans
Business -type activities long -term liabilities
10,385,000 44,015,000 590,000 53,810,000 625,000
280,631 - 37,465 243,166 -
10,104,369 44,015,000 552,535 53,566,834 625,000
6,758,985 - 827,076 5,931,909 827,077
$ 24,389,827 $ 44,896,542 $ 3,565,849 $ 65,720,520 $ 3,634,537
For governmental activities, compensated absences, and self- insurance fund claims payable are liquidated
by the General Fund. For business -type activities, compensated absences are liquidated by the respective
business -type fund.
g. ABC Board
The ABC Board has a note payable with a balance of $262,500 at June 30, 2008. Principal payments of
$4,167 plus interest at a rate of 5.21% are made monthly maturing June 2013. The note is secured by the
land, buildings, and equipment. The following is a schedule of the future minimum principal payments:
Year Ending
June 30
Principal
2009
$ 50,000
2010
50,000
2011
50,000
2012
50,000
2013
62,500
$ 262,500
C. Interfund Balances and Activity
Balances due to /from other funds at June 30, 2008, consist of the following:
Due to the Electric Fund for the purchase of land to be used for incentive grants for
industries:
General Fund $ 1,417,673
Balances due to /from component units at June 30, 2008, consist of the following:
Due to the Primary Government for profit distributions from:
Monroe ABC Board $ 50,000
Due to the Primary Government for Civic Center:
Monroe Tourism Development Authority 19,751
$ 69,751
Transfers to /from other funds at June 30, 2008, consist of the following:
From the Occupancy Tax Fund to the General Fund to
pay administrative costs $ 55,745
From the General Fund to the City Grant Programs
Special Revenue Fund for incentive grants to industries 322,200
From the General Fund to the Water and Sewer Fund for
construction projects 85,580
55
From the General Fund to Capital Projects Funds for
construction projects 720,995
From the Natural Gas Fund to the General Fund to pay
utility billing costs 6,400
From the General Fund to the Airport Fund for
Construction Projects 368,568
From the Electric Fund to the General Fund to pay utility
billing costs 6,200
From Aquatics & Fitness Center Fund to the Natural Gas
Fund for the optional return of donated assets as funds
are available 100,000
$ 1,665,668
D. Revenues, Expenditures, and Expenses
On- Behalf Payments for Fringe Benefits and Salaries
For the fiscal year ended June 30, 2008, the City of Monroe has recognized on- behalf payments for
pension contributions made by the state as a revenue and an expenditure of $11,804 for the 46 employed
firemen who perform firefighting duties for the City's fire department. The employees elected to be
members of the Firemen and Rescue Squad Worker's Pension Fund, a cost - sharing, multiple employer
public employee retirement system established and administered by the State of North Carolina. The Plan
is funded by a $10 monthly contribution paid by each member, investment income, and a State
appropriation.
Also, the City has recognized as a revenue and an expenditure on- behalf of payments for fringe benefits
and salaries of $127,806 for the salary supplement and stipend benefits paid to eligible firemen by the local
board of trustees of the Firemen's Relief Fund during the fiscal year ended June 30, 2008. Under State law
the local board of trustees for the Fund receives an amount each year, which the board may use at its own
discretion for eligible firemen or their departments.
V. JOINTLY GOVERNED ORGANIZATIONS
The City, in conjunction with eighteen other local governments, is a member of the North Carolina
Municipal Power Agency Number 1 (Agency). The Agency was formed to enable municipalities that own
electric distribution systems to finance, construct, own, operate, and maintain generation and transmission
facilities. Each participating government appoints one commissioner to the Agency's governing board.
The nineteen members, which receive power from the Agency, have signed power sales agreements to
purchase a specified share of the power generated by the Agency. Except for the power sales purchase
requirements, no local government participant has any obligation, entitlement, or residual interest. The
City's purchases of power for the fiscal year ended June 30, 2008 were $35,396,259.
Also, the City, in conjunction with eight Central North Carolina counties and fifty other municipalities
established the Centralina Council of Governments (Council). The participating governments established
the Council to coordinate various funding received from federal and State agencies. Each participating
government appoints one member to the Council's governing board. The City paid membership fees of
$8,763 to the Council during the fiscal year ended June 30, 2008.
VI. JOINT VENTURE
The City and the members of the City's fire department each appoint two members to the five - member
local board of trustees for the Firemen's Relief Fund. The State Insurance Commissioner appoints one
additional member to the local board of trustees. The Firemen's Relief Fund is funded by a portion of the
fire and lightning insurance premiums that insurers remit to the State. The State passes these monies to the
local board of the Firemen's Relief Fund. The funds are used to assist fire fighters in various ways. The
City obtains an ongoing financial benefit from the Fund for the on- behalf of payments for salaries and
56
fringe benefits made to members of the City's fire department by the board of trustees. During the fiscal
year ended June 30, 2008, the City reported revenues and expenditures for the payments of $127,806 made
through the Firemen's Relief Fund. The participating governments do not have any equity interest in the
joint venture, so no equity has been reflected in the financial statements at June 30, 2008. The Firemen's
Relief Fund does not issue separate audited financial statements. Instead, the local board of trustees files
an annual financial report with the State Firemen's Association. This report can be obtained from the
Association at Post Office Box 188, Farmville, North Carolina 27828.
VII. RELATED ORGANIZATION
The seven - member board of the Monroe Housing Authority is appointed by the City Council and Mayor of
the City of Monroe. The City is accountable for the Housing Authority because it appoints the governing
board; however, the City is not financially accountable for the Housing Authority. The City of Monroe is
also disclosed as a related organization in the notes to the financial statements for the Monroe Housing
Authority. Complete financial statements for the Housing Authority can be obtained from the Authority's
offices at Post Office Box 805, Monroe, North Carolina 28111.
VIII. RELATED PARTY TRANSACTIONS
The City and its discretely presented component units engaged in the following transactions during the
year ended June 30, 2008:
City of Monroe ABC Board
Payments to the City for profit distributions $ 212,000
Payments to the City for law enforcement 62,358
Total $ 274,358
Monroe Tourism Development Authority:
Payment of a pro -rata portion of the occupancy tax by
the City to the Authority $ 315,890
Payment by the Authority to the City for the Civic
Center $ 210,593
IX. SUMMARY DISCLOSURE OF SIGNIFICANT CONTINGENCIES
Federal and State Assisted Programs
The City has received proceeds from several federal and State grants. Periodic audits of these grants are
required and certain costs may be questioned as not being appropriate expenditures under the grant
agreements. Such audits could result in the refund of grant monies to the grantor agencies. Management
believes that any required refunds will be immaterial. No provision has been made in the accompanying
financial statements for the refund of grant monies.
X. PRIOR PERIOD ADJUSTMENTS
During the fiscal year ended June 30, 2007, the City classified an interfund loan from the Electric Fund to
the General Fund as a transfer. Therefore, an adjustment to beginning net assets has been recorded to
account for those accruals, the net effect of which increased beginning net assets of the Electric Fund and
decreased beginning net assets of the General Fund by $1,494,020 by this change. The consolidated
government -wide statements beginning net assets were not effected.
During the fiscal year ended June 30, 2007, the City capitalized fixed assets in the Electric Fund that were
to be reimbursed by an electric customer under a promissory note. An adjustment of $123,576 to
beginning net assets has been recorded to account for the excess depreciation expense recorded in the year
ending June 30, 2007, due to the cost of these assets being overstated. The note receivable discussed at
Note IV.A.3 provides more detail of this transaction.
57
CITY OF MONROE, NORTH CAROLINA
LAWENFORCEMENT OFFICERS' SPECIAL SEPARATIONALLOWANCE
REQUIRED SUPPLEMENTARY INFORMATION
SCHEDULE OF FUNDING PROGRESS
*Reflects changes in actuarial assumptions.
58
Actuarial Accrued
UAAL
Actuarial
Liability (AAL) -
Unfunded
as a
Actuarial
Value of
Projected
AAL
Funded
Covered
Percentage of
Valuation
Assets
Unit Credit
(UAAL)
Ratio
Payroll
Covered Payroll
Date
(a)
(b)
(b -a)
(a/b)
(c)
((b -a) /c)
12/31/98
-
$ 938,462
$ 938,462
0.00%
$ 2,388,277
39.29%
12/31/99
-
903,751
903,751
0.00
2,628,197
34.39
* 12/31/00
-
1,162,961
1,162,961
0.00
2,574,271
45.18
12/31/01
-
1,164,941
1,164,941
0.00
2,819,591
41.32
12/31/02
-
1,210,250
1,210,250
0.00
2,777,185
43.58
12/31/03
-
1,295,336
1,295,336
0.00
2,910,965
44.50
12/31/04
-
1,406,395
1,406,395
0.00
2,865,536
49.08
12/31/05
-
1,400,593
1,400,593
0.00
3,368,588
41.58
12/31/06
-
1,442,095
1,442,095
0.00
3,623,857
39.79
12/31/07
-
1,650,670
1,650,670
0.00
3,761,162
43.89
*Reflects changes in actuarial assumptions.
58
CITY OF MONROE, NORTH CAROLINA
LAWENFORCEMENT OFFICERS' SPECIAL SEPARATIONALLOWANCE
REQUIRED SUPPLEMENTARY INFORMATION
SCHEDULE OFEMPLOYER CONTRIBUTIONS
Year Ended
Annual Required
Percentage
June 30
Contribution
Contributed
1999
$ 100,561
123.55%
2000
112,650
94.37
2001
113,793
95.10
2002
111,195
99.37
2003
116,909
106.01
2004
121,658
113.76
2005
137,815
119.31
2006
138,373
149.68
2007
143,756
122.24
2008
164,695
127.34
Notes to the Required Schedules:
The information presented in the required supplementary schedules was
determined as part of the actuarial valuations at the dates indicated. Additional
information as of the latest actuarial valuation follows:
Valuation date
Actuarial cost method
Amortization method
Remaining amortization period
Asset valuation method
Actuarial assumptions:
Investment rate of return*
Projected salary increases*
Cost -of- living adjustments
December 31, 2006
Projected unit credit
Level percentage of pay closed
24 Years
Market value
7.25%
4.5% to 12.3%
none
*Includes inflation at 3.75%
59
m
"XT "U
I
a heritage of'progress
SUPPLEMENTAL
FINANCIAL DATA
Nonmajor Governmental Funds
Special Revenue Funds
Special Revenue Funds are used to account for specific revenues that are
legally restricted to expenditures for specified purposes.
Community Development - This fund is used to account for specific
revenues that are restricted to fund continuing rehabilitation of housing
within certain targeted areas of the City.
Downtown Monroe - This fund is used to account for specific revenues
that are restricted for the purpose of downtown revitalization.
Occupancy Tax This fund is used to account for specific revenues that
are restricted for the purpose of tourism development.
City Grant Programs - This fund is used to account for specific revenues
that are restricted to fund rehabilitation of homes within the Historic
District, to make grants under the City's economic development incentive
program, and to provide down payment assistance to qualified low and
moderate income individuals to acquire homes.
State Grant Programs - This fund is used to account for specific state
grant revenues that are restricted for housing development in designated
areas of the City.
Capital Projects Funds
Capital Projects Funds account for financial resources to be used for the
acquisition or construction of major capital facilities other than those
financed by proprietary funds.
Capital Reserve — This fund is used to account for money held for future
capital purposes.
Capital Projects - This fund is used to account for the purchase,
renovation, furnishing, or construction of roadway and facility
improvements.
CITY OF MONROE, NORTH CAROLINA
COMBINING BALANCE SHEET
NONMAJOR GOVERNMENTAL FUNDS
June 30, 2008
Special Revenue
ASSETS
Cash and cash equivalents
Taxes receivable
Accounts receivable
Loans receivable
Total assets
LIABILITIES AND FUND BALANCES
Liabilities:
Accounts payable and
accrued liabilities
Deferred revenue
Total liabilities
Fund balances:
Reserved for:
State statute
Unreserved for:
Designated for subsequent
year's expenditures
Undesignated
Total fund balances
Total liabilities and fund balances
Community Downtown Occupancy City Grant State Grant
Development Monroe Tax Programs Programs
$ 40,230 $ 57,796 $ - $1,317,388 $ 7,999
- 1,291 34,606 - -
3,317 - - - -
21,379 - - - -
$ 64,926 $ 59,087 $ 34,606 $1,317,388 $ 7,999
$ - $ 3,751 $ 34,606 $ 1,837 $
21,379 1,291 - -
21,379 5,042 34,606 1,837
3,317 - - -
40,230
54,045
- 1,315,551
7,999
43,547
54,045
- 1,315,551
7,999
$ 64,926 $
59,087 $
34,606 $1,317,388 $
7,999
62
STATEMENT I
Funds
Total
$ 1,423,413
3 5, 897
3,317
21,379
Capital
Projects
Total Nonmajor
Governmental
Funds
$ 1,326,444 $ 2,749,857
- 35,897
- 3,317
- 21,379
$ 1,484,006 $ 1,326,444 $ 2,810,450
$ 40,194 $ 146,950 $ 187,144
22,670 - 22,670
62,864 146,950 209,814
3,317
1,417,825
- 3,317
1,179,494 1,179,494
- 1,417,825
1,421,142 1,179,494 2,600,636
$ 1,484,006 $ 1,326,444 $ 2,810,450
63
CITY OF MONROE, NORTH CAROLINA
COMBINING STATEMENT OF REVENUES, EXPENDITURES, AND
CHANGES IN FUND BALANCES
NONMAJOR GOVERNMENTAL FUNDS
For the Fiscal Year Ended June 30, 2008
REVENUES
Ad valorem taxes
Other taxes and licenses
Restricted intergovernmental
Program income
Investment earnings
Total revenues
Special Revenue
Community Downtown Occupancy City Grant State Grant
Development Monroe Tax Programs Programs
$ - $ 38,022 $ - $
- - 371,635
5,543 - -
- 8,743 -
5,543 46,765 371,635
- 7,175
- 7,175
EXPENDITURES
Current:
Economic and physical development:
Administration
Loan assistance
Incentive grants
Program costs
Tourism
Capital outlay
Total expenditures
Revenues over (under) expenditures
OTHER FINANCING SOURCES (USES)
Transfers from other funds
Transfers to other funds
Installment purchase obligations issued
Total other financing sources (uses)
Net change in fund balances
Fund balances, beginning
Fund balances, ending
86 205,019
- - - 31,589 -
- - - 269,779 -
- - - - 7,175
- - 315,890 - -
86 205,019 315,890 301,368 7,175
5,457 (158,254) 55,745 (301,368) -
- - - 322,200 -
- - (55,745) - -
- - (55,745 322,200 -
5,457 (158,254)
38,090 212,299
- 20,832 -
- 1,294,719 7,999
$ 43,547 $ 54,045 $ - $1,315,551 $ 7,999
64
STATEMENT 2
Funds Total Nonmajor
Capital Governmental
Total Projects Funds
$ 38,022 $ - $
38,022
371,635 -
371,635
7,175 55,414
62,589
5,543 -
5,543
8,743 8,145
16,888
431,118 63,559
494,677
205,105 -
205,105
31,589 -
31,589
269,779 -
269,779
7,175 -
7,175
315,890 -
315,890
- 3,817,516
3,817,516
829,538 3,817,516
4,647,054
(398,420) (3,753,957) (4,152,377)
322,200 720,995 1,043,195
(55,745) - (55,745)
- 1,900,000 1,900,000
266,455 2,620,995 2,887,450
(131,965) (1,132,962) (1,264,927)
1,553,107 2,312,456 3,865,563
$ 1,421,142 $ 1,179,494 $ 2,600,636
65
CITY OF MONROE, NORTH CAROLINA
GENERAL FUND
SCHEDULE OF REVENUES, EXPENDITURES, AND
CHANGES IN FUND BALANCES -- BUDGET AND ACT UAL
For the Fiscal Year Ended June 30, 2008
REVENUES
Ad valorem taxes:
Taxes
Penalties and interest
Total
Other taxes and licenses:
Privilege licenses
Gross receipts tax on short-term rental property
Cablevision franchise fees
Motor vehicle tax
Total
Unrestricted intergovernmental:
Local option sales taxes
Telecommunications sales tax
Utility franchise tax
Beer and wine tax
State fire fees
ABC profit distribution
Total
Restricted intergovernmental:
Powell Bill allocation
Public safety reimbursement grants
On- behalf payments - Fire and Rescue
ABC Revenue for law enforcement
Senior Center grant
Equitable sharing of federally forfeited property
Firefighters Assistance grant
Union County
Tourism Development Authority
Katrina Transitional Housing grant
Department of Transportation grant
HAZMAT grant
Total
Sales and services:
Recreational fees
Refuse collection fees
Utilities collection fees
Building permit fees
Cemetery revenues
Sale of fixed assets
Rentals
Other fees
Total
Budget Actual
$ 14,449,657 $ 15,151,434
52,000 75,863
14, 501,657 15,227,297
365,000
392,261
40,000
42,120
220,000
287,914
133,000
132,879
758,000
855,174
4,775,000 4,884,108
416,000
490,958
1,402,000
1,430,266
141,000
156,194
3,500
3,853
120,000
212,000
6,857,500 7,177,379
SCHEDULE 3
Variance
Positive
(Negative)
$ 701,777
23,863
725,640
27,261
2,120
67,914
(121)
97,174
109,108
74,958
28,266
15,194
353
92,000
319,879
1,055,200
1,148,097
92,897
482,014
454,271
(27,743)
-
139,610
139,610
58,146
44,312
(13,834)
5,467
5,467
-
-
123,207
123,207
189,000
181,620
(7,380)
181,000
210,593
29,593
9,067
7,873
(1,194)
1,979,894
2,315,050
335,156
830,250
771,424
(58,826)
2,907,000
2,752,514
(154,486)
429,700
453,206
23,506
550,000
450,264
(99,736)
38,450
43,575
5,125
350,000
349,475
(525)
56,850
75,635
18,785
179,225
240,973
61,748
5,341,475
5,137,066
(204,409)
- Continued -
66
SCHEDULE 3,
Continued
CITY OF MONROE, NORTH CAROLINA
GENERAL FUND
SCHEDULE OF REVENUES, EXPENDITURES, AND
CHANGES IN FUND BALANCES -- BUDGET AND ACT UAL
For the Fiscal Year Ended June 30, 2008
Investment earnings
Miscellaneous:
Resource officer reimbursement
Payment in lieu of taxes
Insurance reimbursement
Donations
Other
Total
Total revenues
EXPENDITURES
Current:
General government:
Administration
Salaries and employee benefits
Operating expenditures
Capital outlay
Interdepartmental charges
Planning and zoning
Salaries and employee benefits
Operating expenditures
Engineering
Salaries and employee benefits
Operating expenditures
Capital Outlay
Interdepartmental charges
Utility /tax billing and collection
Salaries and employee benefits
Operating expenditures
Capital outlay
Interdepartmental charges
Variance
Positive
Budget Actual (Negative)
1,075,640 1,241,930 166,290
100,000
118,728
18,728
295,200
331,137
35,937
-
2,614
2,614
40,575
46,005
5,430
41,600
151,793
110,193
477,375
650,277
172,902
30,991,541
32,604,173
1,612,632
3,051,136
2,841,998
209,138
2,854,384
2,192,195
662,189
48,405
40,577
7,828
(2,757,867)
(2,742,502)
(15,365)
3,196,058
2,332,268
863,790
851,035
780,374
70,661
92,490
91,929
561
943,525
872,303
71,222
836,954
834,806
2,148
346,105
160,430
185,675
7,540
7,573
(33)
(152,872)
(152,872)
-
1,037,727
849,937
187,790
362,840
346,381
16,459
88,240
68,129
20,111
7,275
6,891
384
(448,065
(448,065)
-
10,290
(26,664)
36,954
- Continued-
67
SCHEDULE 3,
Continued
CITY OF MONROE, NORTH CAROLINA
GENERAL FUND
SCHEDULE OF REVENUES, EXPENDITURES, AND
CHANGES IN FUND BALANCES -- BUDGET AND ACT UAL
For the Fiscal Year Ended June 30, 2008
Fire
Salaries and employee benefits
4,876,567
4,815,694
Variance
Operating expenditures
688,743
664,881
Positive
Capital outlay
Budget
Actual
(Negative)
6,157,806
Operations Center
114,203
Building standards and code enforcement
Salaries and employee benefits
678,953
668,815
10,138
Operating expenditures
222,890
204,664
18,226
Capital outlay
39,500
37,630
1,870
Interdepartmental charges
(615,817)
(616,246)
429
Total
325,526
294,863
30,663
Special appropriations
Operating expenditures
381,810
347,872
33,938
Total
5,894,936
4,670,579
1,224,357
Transportation:
Streets and highways
Salaries and employee benefits
1,200,479
1,157,090
43,389
Operating expenditures
1,745,476
1,572,205
173,271
Capital outlay
480,800
479,741
1,059
Interdepartmental charges
(297,680)
(303,302)
5,622
Total
3,129,075
2,905,734
223,341
Public safety:
Police
Salaries and employee benefits
6,090,405
6,090,156
249
Operating expenditures
1,110,275
1,052,648
57,627
Capital outlay
393,013
393,571
(558)
7,593,693
7,536,375
57,318
Fire
Salaries and employee benefits
4,876,567
4,815,694
60,873
Operating expenditures
688,743
664,881
23,862
Capital outlay
592,496
563,028
29,468
6,157,806
6,043,603
114,203
Building standards and code enforcement
Salaries and employee benefits
568,626
578,079
(9,453)
Operating expenditures
135,385
102,720
32,665
Total
704,011
680,799
23,212
Total
14,455,510
14,260,777
194,733
- Continued -
68
SCHEDULE 3,
Continued
CITY OF MONROE, NORTH CAROLINA
GENERAL FUND
SCHEDULE OF REVENUES, EXPENDITURES, AND
CHANGES IN FUND BALANCES -- BUDGET AND ACT UAL
For the Fiscal Year Ended June 30, 2008
Environmental protection:
Solid Waste:
Operating expenditures
Culture and recreation:
Salaries and employee benefits
Operating expenditures
Capital outlay
Interdepartmental charges
Total
Debt service:
Principal retirement
Interest and other charges
Total
Total expenditures
Revenues over (under) expenditures
OTHER FINANCING SOURCES (USES)
Transfers from (to) other funds:
Special Revenue Funds
Occupancy Tax Fund
City Grant Programs
Capital Projects Funds
Capital Projects
Electric Fund
Natural Gas Fund
Water and Sewer Fund
Airport Fund
Repayment of loan to Electric Fund
Installment purchase obligations issued
Total other financing sources (uses)
FUND BALANCE APPROPRIATED
Net change in fund balance
Fund balance, beginning
Fund balance, ending
Variance
Positive
Budget Actual (Negative)
2,561,016 2,551,419 9,597
2,453,142
2,333,013
120,129
1,812,935
1,416,812
396,123
140,240
140,120
120
(181,884
(213,940)
32,056
4,224,433
3,676,005
548,428
1,780,204
1,660,339
119,865
237,641
182,511
55,130
2,017,845
1,842,850
174,995
32,282,815 29,907,364 2,375,451
(1,291,274) 2,696,809 3,988,083
58,000
55,745
(2,255)
(479,000)
(322,200)
156,800
(725,433)
(720,995)
4,438
6,200
6,200
-
6,400
6,400
-
(88,053)
(85,580)
2,473
(368,568)
(368,568)
-
(195,000)
(131,477)
63,523
1,477,305
1,417,080
(60,225
(308,149
(143,395)
164,754
1,599,423
-
(1,599,423)
$ -
2,553,414 $
2,553,414
18,054,132
$ 20,607,546
69
SCHEDULE 4,
Page I of S
CITY OF MONROE, NORTH CAROLINA
SPECIAL REVENUE FUNDS
COMMUNITY DEVELOPMENT
SCHEDULE OF REVENUES, EXPENDITURES, AND CHANGES IN
FUND BALANCES -- BUDGETAND ACTUAL
For the Fiscal Year Ended June 30, 2008
REVENUES
Program income
EXPENDITURES
Current:
Economic and physical development:
Administration
Net change in fund balance
Fund balance, beginning
Fund balance, ending
Variance
Positive
Budget Actual (Negative)
$ 5,000 $ 5,543 $ 543
5,000 86 4,914
$ - 5,457 $ 5,457
38,090
$ 43,547
70
SCHEDULE 4,
Page 2 of S
CITY OF MONROE, NORTH CAROLINA
SPECIAL REVENUE FUNDS
DOWNTOWNMONROE
SCHEDULE OF REVENUES, EXPENDITURES, AND CHANGES IN
FUND BALANCES -- BUDGETAND ACTUAL
For the Fiscal Year Ended June 30, 2008
REVENUES
Ad valorem taxes
Investment earnings
Total
EXPENDITURES
Current:
Economic and physical development:
Administration
Revenues over (under) expenditures
OTHER FINANCING SOURCES
Transfers from other funds:
General Fund
FUND BALANCE APPROPRIATED
Net change in fund balance
Fund balance, beginning
Fund balance, ending
Variance
Positive
Budget Actual (Negative)
$ 34,700 $ 38,022 $ 3,322
- 8,743 8,743
34,700 46,765 12,065
218,780 205,019 13,761
(184,080) (158,254) 25,826
- (184,080)
$ - (158,254) $ (158,254)
212,299
$ 54,045
71
SCHEDULE 4,
Page 3 of S
CITY OF MONROE, NORTH CAROLINA
SPECIAL REVENUE FUNDS
OCCUPANCY TAX
SCHEDULE OF REVENUES, EXPENDITURES, AND CHANGES IN
FUND BALANCES -- BUDGETANDACTUAL
For the Fiscal Year Ended June 30, 2008
REVENUES
Other taxes and licenses:
Occupancy tax
EXPENDITURES
Current:
Economic and physical development:
Tourism
Revenues over expenditures
OTHER FINANCING USES
Transfers to other funds:
General Fund
Net change in fund balance
Fund balance, beginning
Fund balance, ending
Budget Actual
Variance
Positive
(Negative)
$ 379,000 $ 371,635 $ (7,365)
321,000 315,890 5,110
58,000 55,745 (2,255
(58,000) (55,745)
2,255
72
SCHEDULE 4,
Page 4 of S
CITY OF MONROE, NORTH CAROLINA
SPECIAL REVENUE FUNDS
CITY GRANT PROGRAMS
SCHEDULE OF REVENUES, EXPENDITURES, AND CHANGES IN
FUND BALANCES -- BUDGETAND ACTUAL
From Inception and For the Fiscal Year Ended June 30, 2008
Actual
REVENUES
Program income
EXPENDITURES
Current:
Economic and physical development:
Loan assistance
Incentive grants
Total expenditures
Revenues over (under) expenditures
Project Prior Current Total to
Authorization Year Year Date
Variance
Positive
(Negative)
$ - $ 113,104 $ - $ 113,104 $ 113,104
275,000
113,105
31,589
144,694
130,306
2,814,572
1,414,909
269,779
1,684,688
1,129,884
3,089,572
1,528,014
301,368
1,829,382
1,260,190
(3,089,572)
(1,414,910
(301,368)
(1,716,278)
1,373,294
OTHER FINANCING SOURCES (USES)
Transfers from other funds:
General Fund 2,814,572 2,492,367 322,200 2,814,567 (5)
Community Development Fund 275,000 217,262 - 217,262 (57,738)
Total other financing sources (uses) 3,089,572 2,709,629 322,200 3,031,829 (57,743)
Revenues and other financing sources
over expenditures and other financing uses $ - $ 1,294,719
Fund balance, beginning
Fund balance, ending
20,832 $ 1,315,551 $ 1,315,551
1,294,719
$ 1,315,551
73
SCHEDULE 4,
Page S of S
CITY OF MONROE, NORTH CAROLINA
SPECIAL REVENUE FUNDS
STATE GRANT PROGRAMS
SCHEDULE OF REVENUES, EXPENDITURES, AND CHANGES IN
FUND BALANCES -- BUDGETAND ACTUAL
From Inception and For the Fiscal Year Ended June 30, 2008
Actual
Project Prior Current Total to
Authorization Year Year Date
Variance
Positive
(Negative)
REVENUES
Restricted intergovernmental (06 -C -1544) $ 400,000 $ - $ 7,175 $ 7,175 $ (392,825)
Restricted intergovernmental (04 -C -1312) 40,000 23,999 - 23,999 (16,001)
Total Revenues 440,000 23,999 7,175 31,174 (408,826)
EXPENDITURES
Current:
Economic and physical development:
Program costs (06 -C -1544)
Program costs (04 -C -1312)
Total expenditures
Revenues under expenditures
OTHER FINANCING SOURCES
Transfers from other funds:
City Grant Programs Fund
Revenues and other financing sources
over (under) expenditures
Fund balance, beginning
Fund balance, ending
400,000 36,000
- 36,000
364,000
60,000 -
7,175 7,175
52,825
460,000 36,000
7,175 43,175
416,825
(20,000) (12,001)
- (12,001
7,999
20,000 20,000
$ - $ 7,999
20,000
- $ 7,999 $ 7,999
7,999
$ 7,999
74
CITY OF MONROE, NORTH CAROLINA
CAPITAL PROJECTS FUNDS
CAPITAL PROJECTS
SCHEDULE OF REVENUES, EXPENDITURES, AND CHANGES
IN FUND BALANCES -- BUDGET AND ACT UAL
From Inception And For The Fiscal Year Ended June 30, 2008
SCHEDULE S
Fund balance, beginning
Fund balance, ending
2,312,456
1,179,494
75
Actual
Variance
Project
Prior
Current
Total to
Positive
Authorization
Years
Year
Date
(Negative)
REVENUES
Restricted intergovernmental
$ 1,670,486
$ 846,077
$ 55,414
$ 901,491
$ (768,995)
Miscellaneous
108
696
-
696
588
Investment earnings
-
-
8,145
8,145
8,145
Total revenues
1,670,594
846,773
63,559
910,332
(760,262)
EXPENDITURES
Capital outlay:
Construction costs capitalized
2,582,763
2,239,664
343,093
2,582,757
6
Construction in progress
5,184,103
84,787
3,432,359
3,517,146
1,666,957
Other costs
1,180,930
866,073
42,064
908,137
272,793
Total expenditures
8,947,796
3,190,524
3,817,516
7,008,040
1,939,756
Revenues over (under) expenditures
(7,277,202)
(2,343,751)
(3,753,957)
(6,097,708)
1,179,494
OTHER FINANCING SOURCES (USES)
Transfers from (to) other funds:
General Fund
5,377,202
4,656,207
720,995
5,377,202
-
Installment purchase obligations issued
1,900,000
-
1,900,000
1,900,000
-
Total other financing sources (uses)
7,277,202
4,656,207
2,620,995
7,277,202
-
Revenues and other financing sources
over (under) expenditures and other
financing uses
$ -
$2,312,456
(1,132,962)
$ 1,179,494
$ 1,179,494
Fund balance, beginning
Fund balance, ending
2,312,456
1,179,494
75
SCHEDULE 6
CITY OF MONROE, NORTH CAROLINA
WATER AND SEWER FUND
SCHEDULE OF REVENUES AND EXPENDITURES —
BUDGETANDACTUAL (NON -GAAP)
For the Fiscal Year Ended June 30, 2008
REVENUES
Operating revenues:
Charges for services:
Water sales
Sewer charges
Water and sewer taps
County waste water charges
Other operating revenues
Total operating revenues
Nonoperating revenues:
Availability fees
Other nonoperating revenues
Investment earnings
Total nonoperating revenues
Total revenues
OTHER FINANCING SOURCES
Installment purchase obligations issued
Total other financing sources
FUND BALANCE APPROPRIATED
Total revenues and other financing sources
Variance
Positive
Budget Actual (Negative)
$ 5,218,900 $
5,247,440 $
28,540
6,650,000
6,485,222
(164,778)
134,800
86,779
(48,021)
555,000
653,653
98,653
12,558,700
12,473,094
(85,606
376,400
232,204
(144,196
12,935,100
12,705,298
(229,802)
1,353,100
1,009,760
(343,340)
10,500
38,332
27,832
680,280
1,200,262
519,982
2,043,880
2,248,354
204,474
14,978,980
14,953,652
(25,328
189,000
179,500
(9,500)
189,000
179,500
(9,500)
(5,328,974) - 5,328,974
$ 9,839,006 $ 15,133,152 $ 5,294,146
- Continued -
76
SCHEDULE 6,
Continued
CITY OF MONROE, NORTH CAROLINA
WATER AND SEWER FUND
SCHEDULE OF REVENUES AND EXPENDITURES —
BUDGETANDACTUAL (NON -GAAP)
For the Fiscal Year Ended June 30, 2008
EXPENDITURES
Distribution system:
Salaries and employee benefits
Operating expenditures
Total
Water filter plant:
Salaries and employee benefits
Operating expenditures
Total
Waste treatment plant:
Salaries and employee benefits
Operating expenditures
Total
Debt service:
Principal retirement
Interest and other charges
Total
Capital outlay
Total expenditures
OTHER FINANCING USES
Transfers to other funds:
General Fund
Water and Sewer Capital Projects Fund
Total other financing uses
Total expenditures and other financing uses
Variance
Positive
Budget Actual (Negative)
$ 1,982,906 $
1,887,735 $
95,171
2,665,725
1,908,652
757,073
4,648,631
3,796,387
852,244
628,452
584,801
43,651
2,245,020
1,972,231
272,789
2,873,472
2,557,032
316,440
846,092
814,263
31,829
1,733,101
1,553,861
179,240
2,579,193
2,368,124
211,069
2,080,625
2,056,306
24,319
639,800
638,238
1,562
2,720,425
2,694,544
25,881
924,885
657,281
267,604
13,746,606
12,073,368
1,673,238
7,400 7,400 -
(3,915,000 (3,922,284) 7,284
(3,907,600 (3,914,884) 7,284
$ 9,839,006 $ 8,158,484 $ 1,680,522
- Continued -
77
SCHEDULE 6,
Continued
CITY OF MONROE, NORTH CAROLINA
WATER AND SEWER FUND
SCHEDULE OF REVENUES AND EXPENDITURES —
BUDGETANDACTUAL (NON -GAAP)
For the Fiscal Year Ended June 30, 2008
Reconciliation from budgetary basis (modified accrual) to full accrual:
Total revenues and other financing sources
Total expenditures and other financing uses
Revenues and other financing sources over
expenditures and other financing uses
Reconciling items:
Debt principal
Installment purchase obligations issued
Amortization of deferred loss on refunding
Amortization of bond premimum
Amortization of bond issuance costs
Capital outlay
Capital contributions
Construction in progress written off in current year
Net book value of assets disposed
Transfer to Water and Sewer Capital Projects Funds
Transfer from General Fund to Water And Sewer Capital Projects Funds
Net expense from capital projects consolidation
Increase in compensated absences
Depreciation and amortization
Total reconciling items
Change in net assets
$ 15,133,152
8,158,484
6,974,668
2,056,306
(179,500)
(26,649)
570
(2,035)
351,985
2,918,184
(863,348)
(3,922,284)
92,980
(23,203)
(28,601)
(1,712,372)
(1,337,967)
$ 5,636,701
78
SCHEDULE 7,
Page I of 2
CITY OF MONROE, NORTH CAROLINA
WATER AND SEWER CAPITAL PROJECTS FUNDS
CAPITAL RESERVE
SCHED ULE OF REVENUES AND EXPENDITURES --
BUDGET AND ACTUAL (NON -GAAP)
For the Fiscal Year Ended June 30, 2008
OTHER FINANCING SOURCES (USES)
Transfers from other funds:
Water and Sewer Capital Projects Funds
Increase in fund balance
Total other financing sources (uses)
Fund balance, beginning
Fund balance, ending
Variance
Positive
Budget Actual (Negative)
3,318,739
$ 3,318,739
79
SCHEDULE 7,
Page 2 of 2
REVENUES
Investment earnings
EXPENDITURES
Construction costs capitalized
Contruction in progress
Other costs
Total expenditures
CITY OF MONROE, NORTH CAROLINA
WATER AND SEWER CAPITAL PROJECTS FUNDS
CAPITAL PROJECTS
SCHEDULE OF REVENUES AND EXPENDITURES --
BUDGET AND ACTUAL (NON -GAAP)
From Inception and For the Fiscal Year Ended June 30, 2008
Revenues over (under) expenditures
OTHER FINANCING SOURCES (USES)
Transfers from (to) other funds:
Water and Sewer Fund
General Fund
Water and Sewer Capital Reserve Fund
Bond issuance costs
Proceeds from revenue bonds
Total other financing sources (uses)
Revenues and other financing sources
over (under) expenditures and other
financing uses
Project
Authorization
Actual
Prior Current
Years Year
Total to
Date
Variance
Positive
(Negative)
$ - $
-
$ 69,288
$ 69,288 $
69,288
592,981
500,000
92,980
624,198
27,410
595,886
623,296
902
45,355,055
148,481
1,202,896
1,351,377
44,003,678
1,041,693
949,202
92,491
1,041,693
-
47,020,946
1,125,093
1,891,273
3,016,366
44,004,580
12,220,944
(34,800,002)
(47,020,946)
(1,125,093)
(1,821,985)
(2,947,078)
44,073,868
6,377,064
10,299,348
(3,922,285)
6,377,063
(1)
592,981
500,000
92,980
592,980
(1)
50,000
50,000
-
50,000
-
(101,751)
-
(101,751)
(101,751)
-
40,102,652
-
5,302,652
5,302,652
(34,800,000)
47,020,946
10,849,348
1,371,596
12,220,944
(34,800,002)
$ - $ 9,724,255 $ (450,389) $ 9,273,866 $ 9,273,866
80
SCHEDULE 8
CITY OF MONROE, NORTH CAROLINA
ELECTRIC FUND
SCHEDULE OF REVENUES AND EXPENDITURES —
BUDGETANDACTUAL (NON -GAAP)
For the Fiscal Year Ended June 30, 2008
REVENUES
Operating revenues:
Charges for services:
Electric power sales
Sales tax
Total
Other operating revenues
Total operating revenues
Nonoperating revenues:
Rate stabilization funds
Power agency funding
Other nonoperating revenues
Investment earnings
Total nonoperating revenues
Total revenues
Variance
Positive
Budget Actual (Negative)
$ 40,122,000 $
41,820,692 $
1,698,692
1,199,400
1,127,943
(71,457)
41,321,400
42,948,635
1,627,235
85,000
441,553
356,553
41,406,400
43,390,188
1,983,788
-
181,068
181,068
-
767,556
767,556
110,000
129,727
19,727
1,261,000
2,300,489
1,039,489
1,371,000
3,378,840
2,007,840
42,777,400
46,769,028
3,991,628
OTHER FINANCING SOURCES
Installment purchase obligations issued
Repayment of loan from General Fund
Repayment of advance from Airport Fund
Total other financing sources
262,000
226,900 (35,100)
195,900
131,477 (64,423)
359,000
359,000 -
816,900
717,377 (99,523
FUND BALANCE APPROPRIATED
Total revenues and other financing sources
12,045,029 - (12,045,029)
$ 55,639,329 $ 47,486,405 $ (8,152,924)
- Continued -
81
SCHEDULE 8,
Continued
CITY OF MONROE, NORTH CAROLINA
ELECTRIC FUND
SCHEDULE OF REVENUES AND EXPENDITURES —
BUDGETANDACTUAL (NON -GAAP)
For the Fiscal Year Ended June 30, 2008
EXPENDITURES
Operations:
Salaries and employee benefits
Operating expenditures
Total
Electric power purchases
Debt service:
Principal retirement
Interest and other charges
Total
Capital outlay
Total expenditures
OTHER FINANCING USES
Transfers to other funds
Electric Capital Projects Funds
General Fund
Advance to Airport Fund
Total other financing uses
Total expenditures and other financing uses
42,621,329 41,057,594
12,652,800
11, 912,796
Variance
6,200
359,000
Positive
Budget
Actual
(Negative)
$ 845,337 $
726,275
$ 119,062
3,156,008
2,020,932
1,135,076
4,001,345
2,747,207
1,254,138
35,400,000
35,396,259
3,741
422,100
378,817
43,283
277,800
292,039
(14,239)
699,900
670,856
29,044
2,520,084
2,243,272
276,812
42,621,329 41,057,594
12,652,800
11, 912,796
6,200
6,200
359,000
359,000
13,018,000
12,277,996
l G<2 "72 G
740,004
- 7 An nnA
$ 55,639,329 $ 53,335,590 $ 2,303,739
- Continued -
82
SCHEDULE 8,
Continued
CITY OF MONROE, NORTH CAROLINA
ELECTRIC FUND
SCHEDULE OF REVENUES AND EXPENDITURES —
BUDGETANDACTUAL (NON -GAAP)
For the Fiscal Year Ended June 30, 2008
Reconciliation from budgetary basis (modified accrual) to full accrual:
Total revenues and other financing sources
Total expenditures and other financing uses
Revenues and other financing sources under
expenditures and other financing uses
Reconciling items:
Debt principal
Installment purchase obligations issued
Amortization of deferred loss on refunding
Amortization of bond premimum
Amortization of bond issuance costs
Capital outlay
Principal repayment of loan from general fund
Payments received on note receivable
Transfer to Electric Capital Projects Funds
Net revenue from capital projects consolidation
Increase in compensated absences
Depreciation and amortization
Total reconciling items
Change in net assets
$ 47,486,405
53,335,590
(5,849,185)
378,817
(226,900)
(19,643)
2,395
(4,282)
2,120, 966
(76,347)
(423,157)
11,912,796
141,472
(9,497)
(1,912,724
11,883,896
$ 6,034,711
83
SCHEDULE 9
CITY OF MONROE, NORTH CAROLINA
ELECTRIC CAPITAL PROJECTS FUNDS
CAPITAL PROJECTS
SCHEDULE OF REVENUES AND EXPENDITURES --
BUDGET AND ACTUAL (NON -GAAP)
From Inception and For the Fiscal Year Ended June 30, 2008
84
Actual
Variance
Project
Prior
Current
Total to
Positive
Authorization
Years
Year
Date
(Negative)
REVENUES
Power agency funding
$ 5,805,850 $
5,592,648
$ -
$ 5,592,648
$ (213,202)
Miscellaneous
-
-
-
-
-
Investment earnings
-
-
291,082
291,082
291,082
5,805,850
5,592,648
291,082
5,883,730
77,880
EXPENDITURES
Construction costs capitalized
4,590,071
4,050,175
399,832
4,450,007
140,064
Construction in progress
38,261,329
2,805,430
13,573,540
16,378,970
21,882,359
Other costs
6,579,655
209,578
149,576
359,154
6,220,501
Total expenditures
49,431,055
7,065,183
14,122,948
21,188,131
28,242,924
Revenues over (under) expenditures
(43,625,205)
(1,472,535)
(13,831,866)
(15,304,401)
28,320,804
OTHER FINANCING SOURCES
Transfers from other funds:
Electric Fund
21,776,526
9,863,725
11,912,796
21,776,521
(5)
Bond issuance costs
(428,205)
-
(428,205)
(428,205)
-
Proceeds from revenue bonds
22,276,884
-
22,276,883
22,276,883
(1)
43,625,205
9,863,725
33,761,474
43,625,199
(6)
Revenues and other financing sources
over expenditures
$ - $
8,391,190
$ 19,929,608
$ 28,320,798
$ 28,320,798
84
SCHEDULE 10
CITY OF MONROE, NORTH CAROLINA
NATURAL GAS FUND
SCHEDULE OF REVENUES AND EXPENDITURES —
BUDGETANDACTUAL (NON -GAAP)
For the Fiscal Year Ended June 30, 2008
Budget
REVENUES
Operating revenues:
Charges for services:
Natural gas sales
Other operating revenues
Total operating revenues
Nonoperating revenues:
Other nonoperating revenues
Investment earnings
Total nonoperating revenues
Total revenues
OTHER FINANCING SOURCES
Installment purchase obligations issued
Transfers from other funds:
Aquatics and Fitness Center Fund
Total other financing sources
Fund balance appropriated
Total revenues and other financing sources
Variance
Positive
Actual (Negative)
$ 17,851,500 $ 18,806,722 $ 955,222
30,000 29,456 (544
17,881,500 18,836,178 954,678
3,000 2,992 (8)
247,000 542,961 295,961
250,000 545,953 295,953
18,131,500 19,382,131 1,250,631
166,000 165,000 (1,000)
100,000 100,000 -
266,000 265,000 (1,000
3,362,489 - 3,362,489
$ 21,759,989 $ 19,647,131 $ 4,612,120
- Continued -
85
SCHEDULE 10,
Continued
CITY OF MONROE, NORTH CAROLINA
NATURAL GAS FUND
SCHEDULE OF REVENUES AND EXPENDITURES —
BUDGETANDACTUAL (NON -GAAP)
For the Fiscal Year Ended June 30, 2008
EXPENDITURES
Operations:
Salaries and employee benefits
Operating expenditures
Total
Natural gas purchases
Debt service:
Principal retirement
Interest and other charges
Total
Capital outlay
Total expenditures
OTHER FINANCING USES
Transfers to other funds:
General Fund
Natural Gas Capital Projects Funds
Total other financing uses
Total expenditures and other financing uses
Variance
Positive
Budget Actual (Negative)
$ 399,987 $ 601,627 $ (201,640)
2,112,552 1,670,267 442,285
2,512,539 2,271,894 240,645
14,102,000
14,101, 837 163
128,550
127,374
1,176
86,000
85,593
407
214,550
212,967
1,583
934,500
583,599
350,901
17,763,589
17,170,297
593,292
6,400
6,400 -
3,990,000
3,688,317 301,683
3,996,400
3,694,717 301,683
$ 21,759,989 $ 20,865,014 $ 894,975
- Continued -
86
SCHEDULE 10,
Continued
CITY OF MONROE, NORTH CAROLINA
NATURAL GAS FUND
SCHEDULE OF REVENUES AND EXPENDITURES —
BUDGETANDACTUAL (NON -GAAP)
For the Fiscal Year Ended June 30, 2008
Reconciliation from budgetary basis (modified accrual) to full accrual:
Total revenues and other financing sources
Total expenditures and other financing uses
Revenues and other financing sources over
expenditures and other financing uses
Reconciling items:
Debt principal
Installment purchase obligations issued
Amortization of deferred loss on refunding
Amortization of bond premimum
Amortization of bond issuance costs
Net book value of assets disposed
Capital outlay
Transfer to Natural Gas Capital Projects Funds
Net income from capital projects consolidation
Increase in compensated absences
Depreciation and amortization
Total reconciling items
Change in net assets
$ 19,647,131
20,865,014
(1,217,883
127,374
(165,000)
(8,743)
400
(1,434)
(26,448)
579,508
3,688,317
4,947
(4,023)
(420,666
3,774,232
$ 2,556,349
87
SCHEDULE H
CITY OF MONROE, NORTH CAROLINA
NATURAL GAS CAPITAL PROJECTS FUNDS
CAPITAL PROJECTS
SCHEDULE OF REVENUES AND EXPENDITURES —
BUDGETANDACTUAL (NON -GAAP)
From Inception and For the Fiscal Year Ended June 30, 2008
REVENUES
Miscellaneous
Investment earnings
Total revenues
EXPENDITURES
Construction costs capitalized
Construction in progress
Other costs
Total expenditures
Revenues over (under) expenditures
OTHER FINANCING SOURCES
Transfers from other funds:
Natural Gas Fund
Certificates of Participation
Bond issuance costs
Proceeds from revenue bonds
Total other financing sources
Revenues and other financing sources
over (under) expenditures
5,850,319 2,162,001
3,688,316
Actual
22,544,000 -
Variance
Project
Prior
Current
Total to
Positive
Authorization
Years
Year
Date
(Negative)
$ -
$ 2,493
$ -
$ 2,493 $
2,493
-
-
48,634
48,634
48,634
-
2,493
48,634
51,127
51,127
552,655
447,505
104,816
552,321
334
31,371,495
731,011
3,925,153
4,656,164
26,715,331
121,103
77,415
43,686
121,101
2
32,045,253
1,255,931
4,073,655
5,329,586
26,715,667
(32,045,253)
(1,253,438)
(4,073,655)
(5,327,093)
26,718,160
5,850,319 2,162,001
3,688,316
5,850,317 (2)
22,544,000 -
-
- (22,544,000)
(71,120) -
(71,120)
(71,120) -
3,722,054 -
3,722,054
3,722,054 -
32,045,253 2,162,001
7,339,250
9,501,251 (22,544,002
$ - $ 908,563 $ 3,265,595 $ 4,174,158 $ 4,174,158
..
CITY OF MONROE, NORTH CAROLINA
AQUATICS AND FITNESS CENTER FUND
SCHEDULE OF REVENUES AND EXPENDITURES —
BUDGETANDACTUAL (NON -GAAP)
For the Fiscal Year Ended Tune 30, 2008
REVENUES
Operating revenues:
Charges for services:
Recreational fees
Other operating revenues
Total operating revenues
Nonoperating revenues:
Other nonoperating revenues
Investment earnings
Total nonoperating revenues
Total revenues
FUND BALANCE APPROPRIATED
Total revenues
SCHEDULE 12
467,118
467,11
$ 4,563,118 $ 4,344,026 $ (219,092)
- Continued -
89
Variance
Positive
Budget
Actual
(Negative)
$ 3,884,000 $
3,994,631
$ 110,631
139,000
167,136
28,136
4,023,000
4,161,767
138,767
-
11,750
11,750
73,000
170,509
97,509
73,000
182,259
109,259
4,096,000
4,344,026
248,026
467,118
467,11
$ 4,563,118 $ 4,344,026 $ (219,092)
- Continued -
89
SCHEDULE 12,
Continued
CITY OF MONROE, NORTH CAROLINA
AQUATICS AND FITNESS CENTER FUND
SCHEDULE OF REVENUES AND EXPENDITURES —
BUDGETANDACTUAL (NON -GAAP)
For the Fiscal Year Ended June 30, 2008
EXPENDITURES
Operations:
Salaries and employee benefits
Operating expenditures
Total
Debt service:
Principal retirement
Interest and other charges
Total
Capital outlay
Total expenditures
OTHER FINANCING USES
Transfers to other funds:
MAFC Capital Projects
Natural Gas Fund
Total other financing uses
Total expenditures and other financing uses
Variance
Positive
Budget Actual (Negative)
$ 1,578,456 $
1,468,781 $
109,675
1,534,262
1,269,630
264,632
3,112,718
2,738,411
374,307
746,516
746,418
98
172,384
172,384
-
918,900
918,802
98
7,500
4,500
3,000
4,039,118
3,661,713
377,405
424,000
410,875
13,125
100,000
100,000
-
524,000
510,875
-
$ 4,563,118 $ 4,172,588 $ 377,405
- Continued -
90
SCHEDULE 12,
Continued
CITY OF MONROE, NORTH CAROLINA
AQUATICS AND FITNESS CENTER FUND
SCHEDULE OF REVENUES AND EXPENDITURES —
BUDGETANDACTUAL (NON -GAAP)
For the Fiscal Year Ended Tune 30, 2008
Reconciliation from budgetary basis (modified accrual) to full accrual:
Total revenues and other financing sources
Total expenditures and other financing uses
Revenues and other financing sources over
expenditures and other financing uses
Reconciling items:
Debt principal
Increase in compensated absences
Net expense from capital projects consolidation
Transfer to MAFC Capital Project Fund
Depreciation and amortization
Total reconciling items
Change in net assets
4,344,026
172.588
171,438
746,418
(5,279)
(22,326)
410,875
(256,262)
873,426
$ 1,044,864
91
SCHEDULE 13
CITY OF MONROE, NORTH CAROLINA
AQUA TICS AND FITNESS CENTER CAPITAL PROJECTS FUNDS
CAPITAL PROJECTS
SCHEDULE OF REVENUES AND EXPENDITURES --
BUDGET AND ACTUAL (NON -GAAP)
From Inception and For the Fiscal Year Ended June 30, 2008
Actual
REVENUES
Investment earnings
EXPENDITURES
Construction costs capitalized
Other costs
Total expenditures
Revenues over (under) expenditures
OTHER FINANCING SOURCES
Transfers from other funds:
Aquatics and Fitness Center Fund
Total other financing sources
Revenues and other financing sources
over expenditures
Project Prior
Authorization Years
Current Total to
Year Date
Variance
Positive
(Negative)
162,876
97,481 65,395
162,876 -
424,000
- 22,326
22,326 401,674
586,876
97,481 87,721
185,202 401,674
(586,876
(97,481 (87,721
(185,202) 401,674
586,876 175,999 410,875 586,874 (410,877)
586,876 175,999 410,875 586,874 (410,877)
$ - $ 78,518 $ 323,154 $ 401,672 $ (9,203)
92
SCHEDULE 14
CITY OF MONROE, NORTH CAROLINA
AIRPORT FUND
SCHEDULE OF REVENUES AND EXPENDITURES —
BUDGETANDACTUAL (NON -GAAP)
For the Fiscal Year Ended June 30, 2008
REVENUES
Operating revenues:
Charges for services:
Leases
Flowage fee
Sales of fuel
Total
Other operating revenues
Total operating revenues
OTHER FINANCING SOURCES
Transfers from other funds:
General Fund
Airport Capital Project Fund
Advance from Electric Fund
Total other financing sources
11110 11t1:11W. I: »:Z1]WN/:VY1101
Total revenues and other financing sources
Variance
Positive
Budget Actual (Negative)
$ 190,100 $ 234,416 $ 44,316
480 - (480)
1,588,974 1,619,004 30,030
1,779,554 1,853,420 73,866
43,450 43,107 (343
1,823,004 1,896,527 73,523
351,815 351,815 -
- 125,343 125,343
359,000 359,000 -
710,815 836,158 125,343
116,107 - (116,107)
$ 2,649,926 $ 2,732,685 $ 82,759
- Continued -
93
SCHEDULE 14,
Continued
CITY OF MONROE, NORTH CAROLINA
AIRPORT FUND
SCHEDULE OF REVENUES AND EXPENDITURES —
BUDGETANDACTUAL (NON -GAAP)
For the Fiscal Year Ended June 30, 2008
Budget
EXPENDITURES
Operations:
Salaries and employee benefits
Operating expenditures
Total
Debt service:
Principal retirement
Interest and other charges
Total
Capital outlay
Total expenditures
OTHER FINANCING USES
Transfers to other funds:
Repayment of advance from Electric Fund
Total other financing uses
Total expenditures and other financing uses
Variance
Positive
Actual (Negative)
$ 384,549 $
398,985 $
(14,436)
1,771,207
1,852,160
(80,953
2,155,756
2,251,145
(95,389
39,870
34,604
5,266
84,300
89,496
(5,196
124,170
124,100
70
11,000
-
11,000
2,290,926
2,375,245
(84,319
359,000 359,000
359,000 359,000
$ 2,649,926 $ 2,734,245 $ (84,319)
- Continued -
94
SCHEDULE 14,
Continued
CITY OF MONROE, NORTH CAROLINA
AIRPORT FUND
SCHEDULE OF REVENUES AND EXPENDITURES —
BUDGETANDACTUAL (NON -GAAP)
For the Fiscal Year Ended Tune 30, 2008
Reconciliation from budgetary basis (modified accrual) to full accrual:
Total revenues and other financing sources $ 2,732,685
Total expenditures and other financing uses 2,734,245
Revenues and other financing sources over
expenditures and other financing uses (1,560)
Reconciling items:
Debt principal 34,604
Amortization of bond issuance costs (3,053)
Capital outlay -
Net expense from capital projects consolidation 175,054
Tranfer from Airport Capital Project Fund (125,343)
Transfer from General Fund to Airport Capital Projects Fund 16,753
Depreciation and amortization (520,964)
Total reconciling items (422,949)
Change in net assets $ (424,509)
95
SCHEDULE IS,
Page I of 2
CITY OF MONROE, NORTH CAROLINA
AIRPORT CAPITAL PROJECTS FUNDS
CAPITAL RESERVE
SCHEDULE OF REVENUES AND EXPENDITURES —
BUDGETANDACTUAL (NON -GAAP)
For the Fiscal Year Ended June 30, 2008
OTHER FINANCING SOURCES (USES)
Transfers from other funds:
Airport Capital Projects Funds
Increase in fund balance
Total other financing sources (uses)
Fund balance, beginning
Fund balance, ending
Variance
Positive
Budget Actual (Negative)
386,799
$ 386,799
96
SCHEDULE 15,
Page 2 of 2
CITY OF MONROE, NORTH CAROLINA
AIRPORT CAPITAL PROJECTS FUNDS
CAPITAL PROJECTS
SCHED ULE OF REVENUES AND EXPENDITURES --
BUDGET AND ACTUAL (NON -GAAP)
From Inception and For the Fiscal Year Ended June 30, 2008
Project
Authorization
REVENUES
Restricted intergovernmental
Investment earnigs
Total revenues
$ 3,407,819
3,407,819
Actual
Prior Current Total to
Years Year Date
$ 1,202,698
1,202,698
Variance
Positive
(Negative)
$ - $ 1,202,698 $ (2,205,121)
175,054 175,054 175,054
175,054 1,377,752 (2,030,067)
EXPENDITURES
Construction costs capitalized
1,906,382
1,752,460
-
1,752,460
153,922
Construction in progress
15,813,616
57,876
1,765,635
1,823,511
13,990,105
Total expenditures
17,719,998
1,810,336
1,765,635
3,575,971
14,144,027
Revenues over (under) expenditures
(14,312,179)
(607,638)
(1,590,581)
(2,198,219)
11,938,906
OTHER FINANCING SOURCES (USES)
Transfers from (to) other funds:
General Fund
433,648
416,895
16,753
433,648
-
Airport Fund
376,158
501,500
(125,343)
376,157
(1)
Proceeds from revenue bonds
13,095,000
-
13,095,000
13,095,000
-
Bond issuance costs
(152,627)
-
(152,627)
(152,627)
-
Installment purchase obligations issued
560,000
-
-
-
(560,000)
Total other financing sources (uses)
14,312,179
918,395
12,833,783
13,752,178
(560,001)
Revenues and other financing sources over
(under) expenditures and other financing uses
$ - $
310,757
$ 11,243,202
$ 11,553,959 $
11,553,959
97
SCHEDULE 16
CITY OF MONROE, NORTH CAROLINA
SCHEDULE OFAD VALOREM TAXES RECEIVABLE
June 30, 2008
Ad valorem taxes receivable $ 823,856
Reconcilement with revenues:
Ad valorem taxes - General fund $ 15,227,297
Amounts written off per statute of limitations 23,594
Refunds, releases of prior years' taxes 764
Interest and advertising cost recovery (75,863
Total collections and credits $ 15,175,792
D1:
Uncollected
Uncollected
Balance
Collections
Balance
Fiscal Year
June 30, 2007
Additions
And Credits
June 30, 2008
2007-2008
$ -
$ 15,092,984
$ 14,607,206
$ 485,778
2006-2007
488,475
149,519
493,780
144,214
2005-2006
103,906
-
35,934
67,972
2004-2005
53,742
-
10,202
43,540
2003-2004
35,937
-
16,781
19,156
2002-2003
20,792
-
1,352
19,440
2001 -2002
9,754
-
816
8,938
2000-2001
16,695
-
397
16,298
1999-2000
8,952
-
234
8,718
1998-
1999
10,036
-
234
9,802
1997-
1998
8,856
-
8,856
-
$ 757,145
$ 15,242,503
$ 15,175,792
Ad valorem taxes receivable $ 823,856
Reconcilement with revenues:
Ad valorem taxes - General fund $ 15,227,297
Amounts written off per statute of limitations 23,594
Refunds, releases of prior years' taxes 764
Interest and advertising cost recovery (75,863
Total collections and credits $ 15,175,792
D1:
SCHEDULE 17
CITY OF MONROE, NORTH CAROLINA
ANALYSIS OF CURRENT TAX LEVY
CITY -WIDE LEVY
For the Fiscal Year Ended June 30, 2008
Secondary Market Disclosures:
Assessed Valuation:
Assessment Ratio'
Real property
Motor vehicle property
Personal property
Public Service Companies
Total Assessed Valuation
Tax Rate per $100
Levy (includes discoveries, releases and abatements)'
'Percentage of appraised value has been established by statute.
Valuation of railroads, telephone companies and other utilities as determined by the
North Carolina Property Tax Commission.
'The levy includes interest and penalties.
In addition to the City -wide rate, the levy by the City on behalf of the Downtown
Monroe District for the fiscal year ended June 30, 2008 was $36,481.
$ 1,878,049,563
227,534,632
583,078,514
49,984,245
2,738,646,954
0.55
$ 15,092,984
oil
Total Levy
Property
excluding
City
- Wide
registered
Registered
Property
Total
Motor
Motor
Valuation
Rate
Levy
Vehicles
Vehicles
Original levy
Property taxed at current
year's rate
$ 2,560,048,108
0.55
$ 14,034,405
$ 13,370,707 $
663,698
Registered motor vehicles taxed
at prior year's rate
103,982,269
612,379
-
612,379
Total
2,664,030,377
14,646,784
13,370,707
1,276,077
Public Utility Allocation
49,984,245
0.55
274,913
274,913
-
Discoveries
43,148,382
0.55
277,787
277,787
-
Abatements
(18,516,050)
0.55
(106,500)
(62,817)
(43,683)
Total property valuation
$ 2,738,646,954
Net levy
15,092,984
13,860,590
1,232,394
Uncollected taxes at June 30, 2007
(485,778)
(267,025)
(218,753)
Current year's taxes collected
$ 14,607,206
$ 13,593,565 $
1,013,641
Current levy collection percentage
96.78%
98.07%
82.25%
Secondary Market Disclosures:
Assessed Valuation:
Assessment Ratio'
Real property
Motor vehicle property
Personal property
Public Service Companies
Total Assessed Valuation
Tax Rate per $100
Levy (includes discoveries, releases and abatements)'
'Percentage of appraised value has been established by statute.
Valuation of railroads, telephone companies and other utilities as determined by the
North Carolina Property Tax Commission.
'The levy includes interest and penalties.
In addition to the City -wide rate, the levy by the City on behalf of the Downtown
Monroe District for the fiscal year ended June 30, 2008 was $36,481.
$ 1,878,049,563
227,534,632
583,078,514
49,984,245
2,738,646,954
0.55
$ 15,092,984
oil
.10 \'ROH;
STATISTICAL
SECTION
Statistical Section
This part of the City of Monroe's comprehensive annual financial report presents
detailed information as a context for understanding what the information in the
financial statements, note disclosures, and required supplementary information
says about the City's overall financial health.
Page
Financial Trends — These tables contain trend information to
help the reader understand how the City's financial performance
and well being have been changed over time .......................... 103
Revenue Capacity — These tables contain information to help the
reader assess the City's most significant local revenue source, the
propertytax ............................... ............................... 108
Debt Capacity These tables present information to help the
reader assess the affordability of the City's current levels of
outstanding debt and the City's ability to issue additional debt in
thefuture .................................. ............................... 112
Demographic and Economic Information — These tables offer
demographic and economic indicators to help the reader
understand the environment within which the City's financial
activities take place ...................... ............................... 117
Operation Information — These tables contain service and
infrastructure data to help the reader understand how the
information in the City's financial report relates to the services
the City provides and the activities ..... ............................... 119
Sources: Unless otherwise noted, the information in these tables is derived
from the comprehensive annual financial reports to the relevant year.
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COMPLIANCE
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POTTER &COMPANY, P.A.
CERTIFIED PUBLIC ACCOUNTANTS
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 A UDITING STANDARDS
To the Honorable Mayor and
Members of the City Council
City of Monroe, North Carolina
We have audited the accompanying financial statements of the governmental activities, the business -type activities,
the aggregate discretely presented component units, each major fund, and the aggregated remaining fund information
of the City of Monroe, North Carolina, as of and for the year ended June 30, 2008, which collectively comprises the
City of Monroe's basic financial statements, and have issued our report thereon dated October 24, 2008. We
conducted our audit in accordance with 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 City of Monroe ABC Board and the City of Monroe
Tourism Authority were not audited in accordance with Government Auditing Standards.
Internal Control Over Financial Reporting
In planning and performing our audit, we considered the City of Monroe's internal control over financial reporting as
a basis for designing our auditing procedures for the purpose of expressing our opinion on the financial statements,
but not for the purpose of expressing an opinion on the effectiveness of the City of Monroe's internal control over
financial reporting. Accordingly, we do not express an opinion on the effectiveness of the City's internal control
over financial reporting.
A control deficiency 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 misstatements on a timely basis. A
significant deficiency is a control deficiency, or combination of control deficiencies, that adversely affects the City's
ability to initiate, authorize, record, process, or report financial data reliably in accordance with generally accepted
accounting principles such that there is more than a remote likelihood that a misstatement of the City's financial
statements that is more than inconsequential will not be prevented or detected by the City's internal control.
A material weakness is a significant deficiency, or combination of significant deficiencies, that results in more than a
remote likelihood that a material misstatement of the financial statements will not be prevented or detected by the
City's internal control.
Our consideration of the internal control over financial reporting was for the limited purpose described in the first
paragraph of this section and would not necessarily identify all deficiencies in internal control over financial
reporting that might be significant deficiencies or material weaknesses. We did not identify any deficiencies in
internal control over financial reporting that we consider to be material weaknesses, as defined above.
Compliance and Other Matters
As part of obtaining reasonable assurance about whether the City of Monroe'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.
123
114 North Church Street ■ Monroe, NC 28112 ■ 704.283.8189 ■ 704.289.3439 fax ■ www.gotopotter.com
This report is intended solely for the information and use of management, others within the organization, members of
City Council, and federal and State awarding agencies and pass - through entities and is not intended to be and should
not be used by anyone other than these specified parties.
October 24, 2008
Monroe, North Carolina
124
FP)
POTTER &COMPANY, P.A.
CERTIFIED PUBLIC ACCOUNTANTS
REPORT ON COMPLIANCE WITH REQUIREMENTS APPLICABLE TO EACH MAJOR FEDERAL
PROGRAM AND INTERNAL CONTROL OVER COMPLIANCE IN ACCORDANCE WITH
OMB CIRCULAR A -133 AND THE STATE SINGLE AUDIT IMPLEMENTATION ACT
To the Honorable Mayor and
Members of the City of Council
City of Monroe, North Carolina
Compliance
We have audited the compliance of the City of Monroe, North Carolina, with the types of compliance requirements
described in the U.S. Office of Management and Budget (OMB) Circular A -133 Compliance Supplement and the
Audit Manual for Governmental Auditors in North Carolina, issued by the Local Government Commission, that are
applicable to each of its major federal programs for the year ended June 30, 2008. The City of Monroe's major
federal programs are identified in the summary of auditor's results section of the accompanying schedule of findings
and questioned costs. Compliance with the requirements of laws, regulations, contracts and grants applicable to each
of its major federal programs is the responsibility of the City of Monroe's management. Our responsibility is to
express an opinion on the City of Monroe's compliance based on our audit.
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; and OMB Circular A -133, Audits of States, Local Governments, and Non-
Profit Organizations, and the State Single Audit Implementation Act. Those standards, OMB Circular A -133, and
the State Single Audit Implementation Act 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 occurred. An audit includes examining, on a test basis, evidence
about the City of Monroe'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.
Our audit does not provide a legal determination on the City of Monroe's compliance with those requirements.
In our opinion, the City of Monroe complied, in all material respects, with the requirements referred to above that are
applicable to each of its major federal programs for the year ended June 30, 2008.
Internal Control Over Compliance
The management of the City of Monroe is responsible for establishing and maintaining effective internal control over
compliance with requirements of laws, regulations, contracts and grants applicable to federal programs. In planning
and performing our audit, we considered the City of Monroe's internal control over compliance with requirements
that could have a direct and material effect on a major federal program in order to determine our auditing procedures
for the purpose of expressing our opinion on compliance, 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 City's internal control over compliance.
A control deficiency in an entity's internal control over compliance 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 noncompliance with a type of compliance requirement of a federal program on a timely basis. A significant
deficiency is a control deficiency, or combination of control deficiencies that adversely affects the entity's ability to
administer a federal program such that there is more than a remote likelihood that noncompliance with a type of
compliance requirement of a federal program that is more than inconsequential will not be prevented or detected by
the City's internal control.
125
114 North Church Street ■ Monroe, NC 28112 ■ 704.283.8189 ■ 704.289.3439 fax ■ www.gotopotter.com
A material weakness is a significant deficiency, or combination of significant deficiencies, that results in more than a
remote likelihood that material noncompliance with a type of compliance requirement of a federal program will not
be prevented or detected by the City's internal control.
Our consideration of internal control over compliance was for the limited purpose described in the first paragraph of
this section and would not necessarily identify all deficiencies in internal control that might be significant
deficiencies or material weaknesses. We did not identify any deficiencies in internal control over compliance that we
consider to be material weaknesses, as defined above.
This report is intended solely for the information and use of management, others within the organization, members of
City Council, and federal and State awarding agencies and pass - through entities and is not intended to be and should
not be used by anyone other than these specified parties.
October 24, 2008
Monroe, North Carolina
126
r �
POTTER &COMPANY, P.A.
CERTIFIED PUBLIC ACCOUNTANTS
REPORT ON COMPLIANCE WITH REQUIREMENTS APPLICABLE TO EACH MAJOR STATE
PROGRAM AND INTERNAL CONTROL OVER COMPLIANCE IN ACCORDANCE WITH
APPLICABLE SECTIONS OF OMB CIRCULAR A -133 AND THE STATE SINGLE AUDIT
IMPLEMENTATION ACT
To the Honorable Mayor and
Members of the City Council
City of Monroe, North Carolina
Compliance
We have audited the compliance of the City of Monroe, North Carolina, with the types of compliance requirements
described in the Audit Manual for Governmental Auditors in North Carolina, issued by the Local Government
Commission, that are applicable to each of its major State programs for the year ended June 30, 2008. The City of
Monroe's major State programs are identified in the summary of auditor's results section of the accompanying
schedule of findings and questioned costs. Compliance with the requirements of laws, regulations, contracts and
grants applicable to each of its major State programs is the responsibility of the City of Monroe's management. Our
responsibility is to express an opinion on the City of Monroe's compliance based on our audit.
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; and applicable sections of OMB Circular AA 33, as described in the Audit
Manual for Governmental Auditors in North Carolina, and the State Single Audit Implementation Act. Those
standards, applicable sections of OMB Circular A -133, and the State Single Audit Implementation Act 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 State program
occurred. An audit includes examining, on a test basis, evidence about the City of Monroe'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. Our audit does not provide a legal determination on the
City of Monroe's compliance with those requirements.
In our opinion, the City of Monroe complied, in all material respects, with the requirements referred to above that are
applicable to each of its major State programs for the year ended June 30, 2008.
Internal Control Over Compliance
The management of the City of Monroe is responsible for establishing and maintaining effective internal control over
compliance with requirements of laws, regulations, contracts and grants applicable to State programs. In planning
and performing our audit, we considered the City of Monroe's internal control over compliance with requirements
that could have a direct and material effect on a major State program in order to determine our auditing procedures
for the purpose of expressing our opinion on compliance, 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 City's internal control over compliance.
A control deficiency in an entity's internal control over compliance 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 noncompliance with a type of compliance requirement of a State program on a timely basis. A significant
deficiency is a control deficiency, or combination of control deficiencies that adversely affects the entity's ability to
administer a State program such that there is more than a remote likelihood that noncompliance with a type of a
compliance requirement of a State program that is more than inconsequential will not be prevented or detected by the
City's internal control.
127
114 North Church Street ■ Monroe, NC 28112 ■ 704.283.8189 ■ 704.289.3439 fax ■ www.gotopotter.com
A material weakness is a significant deficiency, or combination of significant deficiencies, that results in more than a
remote likelihood that material noncompliance with a type of compliance requirement of a State program will not be
prevented or detected by the City's internal control.
Our consideration of internal control over compliance was for the limited purpose described in the first paragraph of
this section and would not necessarily identify all deficiencies in internal control that might be significant
deficiencies or material weaknesses. We did not identify any deficiencies in internal control over compliance that we
consider to be material weaknesses, as defined above.
This report is intended solely for the information and use of management, and others within the organization,
members of City Council, and federal and State awarding agencies and pass - through entities and is not intended to be
and should not be used by anyone other than these specified parties.
October 24, 2008
Monroe, North Carolina
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128
SCHEDULE 18
CITY OF MONROE, NORTH CAROLINA
SCHEDULE OF FINDINGS AND QUESTIONED COSTS
For the Fiscal Year Ended June 30, 2008
Section I. Summary of Auditors' Results
Financial Statements
Type of auditors' report issued: Unqualified
Internal control over financial reporting:
• Material weakness(es) identified?
yes
X no
• Significant Deficiency(s) identified that
are not considered to be material
weaknesses
yes
X none reported
Noncompliance material to financial
statements noted
yes
X no
Federal Awards
Internal control over major federal programs:
• Material weakness(es) identified?
yes
X no
• Significant Deficiency(s) identified that
are not considered to be material
weaknesses
yes
X none reported
Type of auditors' report issued on compliance for major federal programs:
Unqualified.
Any audit findings disclosed that are required
to be reported in accordance with Section
510(a) of Circular A -133
yes
X no
Identification of major federal programs:
CFDA Number
Name of Federal Program
97.083
Staffing for Adequate Fire & Emergency Response (SAFER)
Dollar threshold used to distinguish between
Type A and Type B Programs
$ 300,000
Auditee qualified as low -risk auditee?
X yes
no
State Awards
Internal control over major State programs:
• Material weakness(es) identified?
yes
X no
• Significant Deficiency(s) identified that
are not considered to be material
weaknesses
yes
X none reported
- Continued-
129
SCHEDULE 18,
Continued
CITY OF MONROE, NORTH CAROLINA
SCHEDULE OF FINDINGS AND QUESTIONED COSTS
For the Fiscal Year Ended June 30, 2008
Type of auditors' report issued on compliance for major State programs: Unqualified
Any audit findings disclosed that are required
to be reported in accordance with the State
Single Audit Implementation Act yes X no
Identification of major State programs:
Program Name
Powell Bill
Section II - Financial Statement Findings
None reported.
Section III - Federal Award Findings and Questioned Costs
None reported.
Section IV - State Awards Findings and Questioned Costs
None reported.
130
CITY OF MONROE, NORTH CAROLINA
SUMMARY SCHEDULE OF PRIOR YEAR AUDIT FINDINGS
For the Fiscal Year Ended June 30, 2008
Finding: None reported.
SCHEDULE 19
all
SCHEDULE 20
CITY OF MONROE, NORTH CAROLINA
SCHEDULE OF EXPENDITURES OF FEDERAL AND STATE A WARDS
For the Fiscal Year Ended Tune 30, 2008
State/
Federal Pass - Through Federal (Direct
Grantor /Pass- Through CFDA Grantor's and Pass - Through) State Local
Grantor/Program Title Number Number Expenditures Expenditures Expenditures
Federal Grants:
Cash Programs:
U.S. Department of Justice:
Direct Programs:
Drug Enforcement Administration
Law Enforcement Byrne Grant
Bulletproof Vest Partnership Program
U.S. Department of Homeland Security
Direct Pro rg ams:
Staffing for Adequate Fire & Emergency
Response (SAFER)
Assistance to Firefighers Grant
U.S. Department of Transportation:
Federal Aviation Administration:
Passed - through the N.C. Department
of Transportation:
Streetscape Phase IV -A
Federal Highway Administration:
Passed - through the N.C. Department
of Transportation:
Government Highway Safety Program
Total Assistance - Federal Programs
State Grants:
Cash Assistance:
N.C. Department of Transportation:
Powell bill
NCSU Clean Fuel Advance Technology Grant
N.C. Department of Community Assistance:
Scattered Site Housing Grant
N.C. Crime Control and Emergency Management:
Katrina Transitional Housing
N.C. Department of Health and Human Services:
Aging Grant
Total Assistance - State Programs
Total Federal and State Assistance
16.579 $ 35,115 $ $ 460
16.592 29,942 -
16.607 2,800 2,800
97.083 385,432 67,422
97.044 181,620 20,179
20.205 36237.17.7.1 55,414 160,662
36237.17.7.2
20.600 26,378 22,756
716,701 274,279
1,244,125 -
9,720 3,041
7,175 -
7,873 -
5,467 1,822
- 1,274,360 4,863
$ 716,701 $ 1,274,360 $ 279,142
- Continued
132
SCHEDULE 20,
Continued
CITY OF MONROE, NORTH CAROLINA
SCHEDULE OF EXPENDITURES OF FEDERAL AND STATE A WARDS
For the Fiscal Year Ended June 30, 2007
Notes to the Schedule of Expenditures of Federal and State Financial Awards:
The accompanying schedule of expenditures of federal and State awards includes the federal and State grant
activity of the City of Monroe and is presented on the modified accrual basis of accounting. The
information in this schedule is presented in accordance with the requirements of OMB Circular A -133,
Audits of States, Local Governments, and Non - Profit Organizations, and the State Single Audit
Implementation Act. Therefore, some amounts presented in this schedule may differ from amounts
presented in, or used in the preparation of the basic financial statements.
133
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