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Comprehensive Annual Financial Report - June 30, 2011�.v.. ,w ..+{w..,h,� tw CITY OF �rIONROE a heritage of progress City of Monroe, North Carolina Comprehensive Annual Financial Report For The Fiscal Year Ended June 30, 2011 Prepared By Department of Finance Assistant City Manager/Director of Finance Greg Demko Assistant Director of Finance Lisa Strickland Budget Analyst Mary Lou Clark CITY OF .�IONROE a heritage of progress ùóèãíöïíîêí÷îíêèôùûêíðóîû èûúð÷íöùíîè÷îèé òÇÎ×    óîèêíøçùèíêãé÷ùèóíîPage ð×ÈÈ×ÊÍÖèÊÛÎÉÏÓÈÈÛÐvii - xiv õöíûù×ÊÈÓÖÓÙÛÈ×ÍÖûÙÔÓ×Æ×Ï×ÎÈÖÍÊ÷ÄÙ×ÐÐ×ÎÙ×ÓÎöÓÎÛÎÙÓÛÐê×ÌÍÊÈÓÎÕxv ðÓÉÈÍÖìÊÓÎÙÓÌÛÐíÖÖÓÙÓÛÐÉ................................................................xvi íÊÕÛÎÓÂÛÈÓÍÎÛÐùÔÛÊÈxvii öóîûîùóûðé÷ùèóíî óÎØ×Ì×ÎØ×ÎÈûÇØÓÈÍÊɪê×ÌÍÊÈ.................................................................................... 1 - 2 ïÛÎÛÕ×Ï×ÎȪÉøÓÉÙÇÉÉÓÍÎÛÎØûÎÛÐÃÉÓÉ3 - 12 Exhibit Page úÛÉÓÙöÓÎÛÎÙÓÛÐéÈÛÈ×Ï×ÎÈÉ Government-wide Financial Statements: Statement of Net Assets...................................................................................... 115 Statement of Activities....................................................................................... 216 - 17 Fund Financial Statements: Balance Sheet - Governmental Funds.................................................................. 318 Reconciliation of the Governmental Funds Balance Sheet to the Statement of Net Assets.................……….. ................................................... 419 Statement of Revenues, Expenditures, and Changes In Fund Balances – Governmental Funds….. ................................................... 520 Reconciliation of the Statement of Revenues, Expenditures, and Changes in Fund Balances of Governmental Funds to the Statement of Activities................................................................................... 621 Statement of Revenues, Expenditures, and Changes in Fund Balances - Budget and Actual - General Fund........................................... 723 Statement of Net Assets - Proprietary Funds.......................................................... 824 - 25 Statement of Revenues, Expenses, and Changes in Fund Net Assets - Proprietary Funds............................................................ 926 - 27 Statement of Cash Flows - Proprietary Funds........................................................ 1028 - 31 Notes to the Financial Statements............................................................................ 32 - 66 RequiredSupplemental Financial Data: Law Enforcement Officers’ Special Separation Allowance Schedule of Funding Progress............................................................................. 67 Law Enforcement Officers’ Special Separation Allowance Schedule of Employer Contributions................................................................ 68 i ùóèãíöïíîêí÷îíêèôùûêíðóîû èûúð÷íöùíîè÷îèé òÇÎ×   Page The Health Care Plan Schedule of Funding Progress……………………………………………………….. 69 The Health Care Plan Schedule of Employer Contribution…………………………………………………. 70 íÈÔ×ÊéÇÌÌÐ×Ï×ÎÈÛÐóÎÖÍÊÏÛÈÓÍÎ Combining and Individual Fund Statements and Schedules: Nonmajor Governmental Funds: Combining Balance Sheet ..... ............................ ............. ............. ............................ 72 - 73 Combining Statement of Revenues, Expenditures, and Changes in Fund Balances ............................ ............. ............. ............................ 74 – 75 Internal Service Funds: Combining Statement of Net Assets…………………………………………………… 76 Combining Statement of Revenues, Expenses, and Changes in Fund Net Assets……………………………………………………….. 77 Combining Statement of Cash Flows………………………………………………….. 78 Governmental Funds Budgetary Schedules: Schedule of Revenues, Expenditures, and Changes in Fund Balances - Budget and Actual - General Fund ............. ............................ 79 - 82 Schedule of Revenues, Expenditures, and Changes in Fund Balances - Budget and Actual - Special Revenue Funds .......................... 83 - 87 Schedule of Revenues, Expenditures, and Changes in Fund Balances - Budget and Actual - Capital Projects Funds ........................... 88 - 89 Enterprise Funds Budgetary Schedules: Schedule of Revenues and Expenditures - Budget and Actual - (NON-GAAP): Water and Sewer Fund .. ............................ ............. ............. ............................ 90 - 92 Water and Sewer Capital Projects Funds .... ............. ............. ............................ 93 - 94 Electric Fund .... ............. ............................ ............. ............. ............................ 95 - 97 Electric Capital Projects Fund ..................... ............. ............. ............................ 98 Natural Gas Fund ........... ............................ ............. ............. ............................ 99 - 101 Natural Gas Capital Projects Fund .............. ............. ............. ............................ 102 Aquatics and Fitness Center Fund ............... ............. ............. ............................ 103 – 105 ii ùóèãíöïíîêí÷îíêèôùûêíðóîû èûúð÷íöùíîè÷îèé òÇÎ×   Page Airport Fund ...... ............. ............................ ............. ............. ............................ 106 - 108 Airport Capital Projects Fund ..................... ............. ............. ............................ 109 Storm Water Fund………………………………………………………………...110 – 112 Solid Waste Fund………………………………………………………………… 113 – 115 Internal Service Funds Budgetary Schedules: Schedule of Revenues and Expenditures – (NON-GAAP): Health and Dental Fund…………………………………………………………… 116 Workers’ Compensation Fund…………………………………………………….. 117 Property and Liability Fund………………………………………………………. 118 Other Schedules Schedule of Ad Valorem Taxes Receivable ........ ............. ............. ............................ 119 Analysis of Current Tax Levy - Citywide Levy .. ............. ............. ............................ 120 Page Table éèûèóéèóùûðé÷ùèóíî Financial Trends: Net Assets by Component ........... ............................ ............. ............. ............................ 1 123 Changes in Net Assets ... ............. ............................ ............. ............. ............................ 2 124 - 125 Fund Balances, Governmental Funds ....................... ............. ............. ............................ 3 126 Changes in Fund Balances, Governmental Funds .... ............. ............. ............................ 4 127 Revenue Capacity: Assessed Value and Actual Value of Taxable Property ......... ............. ............................ 5 128 Direct and Overlapping Property Tax Rates ............ ............. ............. ............................ 6 129 Principal Property Taxpayers ..... ............................ ............. ............. ............................ 7 130 Property Tax Levies and Collections ....................... ............. ............. ............................ 8 131 Debt Capacity: Ratios of Outstanding Debt by Type ....................... ............. ............. ............................ 9 132 Ratios of General Bonded Debt Outstanding .......... ............. ............. ............................ 10 133 Direct and Overlapping Governmental Activities Debt ........ ............. ............................ 11 134 Legal Debt Margin Information . ............................ ............. ............. ............................ 12 135 Pledged-Revenue Coverage ........ ............................ ............. ............. ............................ 13 136 Demographic and Economic Information: Demographic and Economic Statistics ..................... ............. ............. ............................ 14 137 Principal Employers ..... ............. ............................ ............. ............. ............................ 15 138 Operation Information: Full-Time Equivalent City Governmental Employees by Function .... ............................ 16 139 Operating Indicators by Function ............................ ............. ............. ............................ 17 140 iii ùóèãíöïíîêí÷îíêèôùûêíðóîû èûúð÷íöùíîè÷îèé òÇÎ×   Page Capital Asset Statistics by Function ......................... ............. ............. ............................ 18 141 ùíïìðóûîù÷é÷ùèóíî Schedule Report on Internal Control Over Financial Reporting and on Compliance and Other Matters Based on an Audit of Financial Statements Performed in Accordance with õÍÆ×ÊÎÏ×ÎÈûÇØÓÈÓÎÕéÈÛÎØÛÊØÉ .. ............. ............. ............................ 143 - 144 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 ....... ............. ............................ ............. ............. ............................ 145 - 146 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.............. ............. ............. ............................ 147 - 148 Schedule of Findings and Questioned Costs ............ ............. ............. ............................ 25 149 – 150 Corrective Action Plan .. ............. ............................ ............. ............. ............................ 26 151 Summary Schedule of Prior Year Audit Findings ... ............. ............. ............................ 27 152 Schedule of Expenditures of Federal and State Awards ........ ............. ............................ 28 153 - 154 iv Introductory Section • Letter of Transmittal • Certificate of Achievement for Excellence in Financial Planning • List of Principal Officials • Organizational Chart CITY OF .�IONROE a heritage of progress  ùóèãíöïíîêí÷ ìíúíä¦ïíîêí÷îù    ìôíî÷     öûä     November 1, 2011 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, 2011. 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, 2011. 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 involves 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 evaluating 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 èÔ×ê×ÌÍÊÈÓÎÕ÷ÎÈÓÈÃÛÎØé×ÊÆÓÙ×ÉìÊÍÆÓØ×Ø 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, stormwater, 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, 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, Union Smart Start, Arc of Union County, Monroe Middle School, the Police Athletic League, United Family Services, Urban League of Central Carolinas and the Union County JobReady Partnership Council, Inc. íÊÕÛÎÓÂÛÈÓÍÎÍÖõÍÆ×ÊÎÏ×ÎÈ 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 just over 33,000 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. viii ÷ÙÍÎÍÏÓÙùÍÎØÓÈÓÍÎÛÎØíÇÈÐÍÍÑ In spite of the national recession, new and existing industries have announced millions of dollars in new capital investments in manufacturing equipment and facility expansions. Monroe’s workforce is diversified, consisting of industrial, construction, agricultural, and retail employment. The City’s economic base includes major employers involved in aerospace, plastics, food processing, professional services, and education. While serving as a regional employment and commercial center for surrounding communities, the City maintains a small town atmosphere and enjoys the benefits of being part of the Charlotte metropolitan region. Monroe’s industrial citizens continue to grow and prosper giving Monroe and Union County national recognition. In 2008 Monroe was named in the Top 5 in the United States for Excellence in Aerospace th Recruitment by Expansion Solutions magazine. While in 2009, Union County was 10 in the nation in job creation from 2000 to 2008 by CNN/Money. April 2010 we were named “Top 10 Aerospace Communities in the South You May Not Know About” by Southern Business Development magazine. For 2011, Monroe again received media coverage among international trade magazines and the Wall Street Journal. Because of our recruitment and retention efforts, Monroe has maintained the lowest unemployment in the Charlotte Region for 11 consecutive years. Monroe has evolved into a premier location for precision manufacturing. Nearly 12% of the industrial base and 26% of the manufacturing employment is deep-rooted in aerospace, resulting in the highest geographic concentration of aerospace companies in North Carolina (NC Department of Commerce – Sept 2008). Also, Monroe’s industrial base is international with 10 countries represented among 15 companies. With recent investments from Scott Safety, ATI Allvac, Goodrich Corporation, and Turbomeca Manufacturing, Monroe will sustain employment and utility customers during the current economic trough and is well positioned to prosper as the economy rebounds. ïÛÒÍÊóÎÓÈÓÛÈÓÆ×É 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 incremental single digit rate increases rather than large rate increases in the year infrastructure is financed. Due to the continued sluggish economy, the Water Resources Department has revised the timing for several strategic capital project initiatives, including the Reclaimed Water System project, Bearskin Sewer outfall upgrade, and wastewater treatment plant expansion. Current initiatives are focusing on system sustainability and asset management programs. The renewal and replacement of aging water and wastewater pipeline infrastructure is a priority. Preventative maintenance programs for all mechanical equipment have also been established and refined. Utility coordination/realignments for the Turnpike Authority Monroe Bypass have been funded. Work continues on the Stewart Creek sewer outfall and pump station replacement. The City has secured final approval for funding the project via a $10.3 million dollar State Revolving Fund loan from the North Carolina Department of Environment and Natural Resources Constructions Grants and Loans Division. The City’s Natural Gas Department has completed a 43 mile natural gas transmission line providing a direct connection between Monroe’s distribution system and the Transcontinental Pipeline. This transmission line was placed in service in May 2010. The new pipeline provides Monroe with the ability to move more than 69,000 decatherms per day which is more than 2.5 times the amount allowed under our former contract with a local investor owned utility. In addition the debt service on the pipeline is less than previous demand charges. With the additional capacity a distribution expansion study has been completed and expansion projects that will add approximately 80 miles of distribution piping have been funded. Construction of the expansion projects began in August and will take about two years to complete. The expansion projects should add 2,000 or more customers over the next 5 to 10 years. ix The City’s Electric Department continues work on the final section of a 12.8 mile 100 kilovolt transmission loop, which when completed will provide a complete loop around the city and dual feed capabilities to each substation. This project will greatly enhance reliability and maintainability of the electric system. Work is also under way to add 13.2 kilovolt capacity to the Western side of the city by installing a 100 to 13.2 kilovolt transformer at the Goldmine road substation. This project should be completed in early 2013. Several system improvement projects are also under way. Conversion of 4 kilovolt circuits from our Cemetery Substation to 13.2 kilovolts is underway and scheduled for completion during late 2012. Conversion of all remaining 4 kilovolt circuits is a long term goal which once completed will allow for a reduction in warehouse inventory, and significant reductions in distribution line losses. Another significant system improvement project under construction is a project to reconductor several main line feeders at the Camp Sutton substation. These projects should be completed during the fall of 2012 and will improve reliability, reduce system losses, and provide more system operating capabilities. In January 2009, the City implemented a stormwater utility program to address the EPA’s National Pollutant Discharge Elimination System, Phase II (NPDES) requirements and to provide for a comprehensive stormwater program to enhance the existing stormwater system. As part of the NPDES requirements, the Engineering Department has developed several stormwater public education and involvement programs. These programs include classroom presentations using Enviroscape (watershed model), Adopt-a-Stream, and storm drain marker. In addition, the Engineering Department has developed in-house pollution prevention and good housekeeping education program for city employees on spill prevention, vehicle/equipment maintenance and outdoor storage of materials and wastes. As part of the NPDES Illicit Discharge Detection and Elimination requirement, the Engineering Department has began walking the streams within the city limits to identify illicit discharges, which is scheduled for completion by the end of 2012. As part of the program to enhance the existing stormwater system, the City established a 6-person stormwater maintenance crew, whose responsibilities include repair, new construction and routine system maintenance on the stormwater infrastructure system. The stormwater maintenance crew has completed over 485 work orders in addition to completing six capital improvement projects and two major drainage improvement projects. In the upcoming year, two capital improvement projects are proposed for the stormwater maintenance crew. The Engineering Department has also retained an engineering firm to complete a stormwater master plan for the entire city. The engineering consultant has completed the stormwater master plan for the Stewart Creek watershed. By December 2011, the engineering consultant is scheduled to complete the stormwater master plan for the Bearskin Creek watershed. Stormwater master planning for the entire city to identify and prioritize future stormwater capital improvements needs will be completed over the next several years. The City continues to invest in its future. The Charlotte-Monroe Executive Airport is undergoing a $21+ million renovation and expansion, funded through a Combined Enterprise Revenue Bond as well as Federal and State grants. This project includes hangar acquisition and construction, terminal expansion design, ramp area expansion, taxiway widening, and runway lengthening and strengthening. The long-range master plan for the airport facility has the capacity for approximately $800 million of new aircraft and hangar investment over the next 40 years. The community has opened its second industrial park, known as AeroPointe Industrial Centre, located adjacent to the airport. AeroPointe will compliment the airport and the established 500-acre Monroe Corporate Center, offering housing to smaller companies that will support the local large manufacturing base. City Council is supportive of the City’s public safety departments and supports their efforts in making Monroe a better community. The Monroe Police Department police officers participated in the Police Athletic Program this year as the program included three sports: football, basketball, and baseball. Cheerleading was also added to the program in an effort to promote more participation. During calendar year 2010, the Police Athletic League had over one hundred children participating in football, cheerleading, two basketball teams and two baseball teams. The Monroe Police Department was selected to be a part of the High Intensity Drug Trafficking Area (HIDTA) designation for Mecklenburg, Union and Gaston Counties. This is a collaborative effort between x local, state and federal law enforcement that will assist in the ongoing battle against the Mexican drug trafficking organizations in our area. One of our officers has been assigned to work on the HIDTA task force which should positively impact the residents in these counties. Three officers have been added to our reserve officer status. The reserve officers will assist in an official police officer capacity where needed and at no cost to the city. The police department’s command staff was restructured during this year. An assistant chief was designated as well as two captains. One captain oversees the patrol division and the other captain oversees the Criminal Investigation Bureau and special services. The Monroe Fire Department was recognized as the Union County Safe Kids Outstanding Child Safety Seat Program for 2010 and Captain Robert Bolick was the recipient of the “Child Passenger Seat Technician of the Year” for Union County. Each fire company averaged 407 hours of in-service training for calendar year 2010. All Fire Captains completed the NC Fire & Rescue Commission Level I Fire Instructor course. All Fire Captains and Chief Officers obtained Fire Officer II certification and all Chief Officers completed the Chief 101 training class by the NC State Fire Marshal’s Office. The fire department transitioned to the 800 MHz radio system and is fully operational on this system, which provides increased capacity and coverage as well as interoperable emergency communications with other emergency service agencies. The fire department applied for and received a grant from the National Fire Protection Agency (NFPA) to implement the “Remembering When Program” designed for elderly residents. The department also conducted fire extinguisher training (at no cost) to over 800 participants through 49 separate classes and provided public education information to over 7,900 individuals. The fire department created a fire extinguisher video that demonstrates the proper use of a fire extinguisher. The video is provided to the public on the fire department’s website. The fire department has also completed or made progress on various goals and objectives included in the department’s community driven strategic plan. Approximately 100 members of the community along with over 30 members of the fire department came together in 2009 to develop the strategic plan, which will guide the fire department over the next five years. The City’s fire department holds a Class 3 insurance rating from the Insurance Services Office (ISO), 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 of Monroe continues to aggressively seek funding for roadway improvements, and has been active in its support for the development and construction of the Monroe Connector/ Bypass Project as well as M. L. King Boulevard, which has recently been completed. Multiple projects that are associated with the Downtown Master Plan as well as the transportation solutions developed by a related transportation study to enhance the development of the Downtown area await funding. In addition, the City has design and construction drawings prepared for the re-alignment of Concord Avenue with Charlotte Avenue to address congestion as vehicles move out of the Downtown Area and once funding is obtained, will be in position to bid and construct this much needed improvement. The City is constantly looking at methods and practices to adequately maintain existing infrastructure and extend our transportation dollars. Chip sealing is one such practice introduced recently that will enable the resurfacing of more miles of streets each year through significantly reduced cost when compared to the traditional asphalt overlay. The City of Monroe, Mayor and Council and concerned citizens would like to give Downtown its own market niche. City Council has approved a Master Plan for the downtown area. 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 xi ‘heart and soul’ of Union County. Monroe which is 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 Hardware Warehouse project added 26 residential units and street level retail shops, was completed in March of 2011 and is approximately fifty percent occupied. The project has received Federal and State Rehab Tax Credits and also Mill Tax Credits and was approximately a $5.6 million investment in Downtown. The City has undertaken streetscape improvements on Hayne Street in the project block and has opened up the rear alley on the Windsor Street side per the Downtown Master Plan. The English Building has undergone upper floor rehabilitation and is fully occupied with professional offices. Both the Warehouse and English Building were private investment preservation projects. The Joffre Parking Lot, a public lot, has been improved by the City with retaining walls and landscaping in anticipation of an infill development project in the future. Future plans for downtown will be prioritized according to the Master Plan and the City’s Strategic Plan developed along with City Council. The IT department is continuing to update the City’s server hardware and software infrastructure. A new SQL server will be implemented soon. The VM-Ware environment has been implemented. This virtual server environment allows the IT department to better manage the server hardware requirements and provide more up-time to the City’s IT infrastructure. An additional separate virtual server environment is planned for the internet connected servers by December 2011. A new data center has been constructed within the City Hall building to accommodate the need for growth and future expansion. The new data center has redundant cooling capacity and uninterruptable power supplies. The IT department has replaced all of the switches across our network providing faster throughput for the network and much better management for network security and data flow. By the end of September a new VOIP telephone system will be implemented. This system will include recording capabilities and unified communications with the e-mail system. The majority of the telephone system is hosted on VM-Ware servers providing more redundancy and reliability. On completion of the new Energy Services building, the IT department will start building a disaster recovery site at that location. The City of Monroe pursues grant funding to provide resources for the completion of various projects. The City has recently received funding from the Federal Aviation Administration and the NC Division of Aviation of nearly $5 million, including $2.6 million for the airport runway overlay and strengthening and apron pavement rehabilitation project. During the 2010-2011 year, the police department had a significant increase in grant funding. Funding in the amount of $600,000 was awarded to transition our radio system to the 800 MHz system and upgrade our in-car video systems. The first $300,000 was used to purchase hand held 800 MHz radios for officers. The second phase of this grant was used to purchase mobile radios and upgrade the in-car cameras. The City is also continuing to receive funding from the US Department of Justice for a three-year grant for two police officers. The City was a recipient of a U.S. Department of Housing and Urban Development economic development initiative grant. This grant was used to renovate the Old Armory building in Monroe for neighborhood revitalization. The City is also a regular recipient of the Department of Justice Assistance Grants and Community Development Block Grants. ðÍÎÕè×ÊÏöÓÎÛÎÙÓÛÐìÐÛÎÎÓÎÕ The city seeks to maintain a strong financial position. This objective requires regular long-term planning of operating and capital requirements for its major general government and enterprise programs. In doing so, the City relies on key financial policies and procedures for dealing with future events in financially responsible ways. xii Annually, the City adopts a 5-year Capital Improvement Program (CIP) that looks ahead to project and plan for capital needs. The program outlines each capital project, the estimated cost, description and funding source. This city takes into consideration and monitors CIP needs that require additional operating costs and personnel. Monroe City Council and management are committed to budgeting and managing all resources in the most cost-effective manner. ê×Ð×ÆÛÎÈöÓÎÛÎÙÓÛÐìÍÐÓÙÓ×É The City regularly reviews revenues and expenditures throughout the fiscal year. During the course of the year, if actual revenues are expected to fall short of the budgeted amount, expenditures are reduced to ensure that a shortage of funds or a significant use of fund balance does not occur. City financial policy dictates that our current operating revenues be sufficient to support current operating expenditures. The City administers a cash management and investment program that seeks to maximize, in order of priority, the preservation of funds, liquidity and interest earnings over its cash and investments. Cash resources of the individual funds are combined to form a pool of cash and investments. The average cash and investment pool balance during the year was $94,086,507 and the average investment earnings rate was 2.04%. Investment income includes the change in the fair value of investments. During the year monies were invested and secured in accordance with state law. A key financial goal of the City for many years has been the maintenance of a 25% undesignated fund balance level in the General Fund. In addition, the City has desired to appropriate a consistent level of fund balance each year resulting from positive budget variances. These goals are met in the fiscal year 2011 results that are built into the 2011-12 operating budgets. Other practices followed are designed to avoid the meeting of recurring expense needs with one-time revenue resources and to ensure an ongoing mix of pay- as-you-go funding of capital needs with long-term debt. ê×ÉÌÍÎÉ×ÈÍùÇÊÊ×ÎÈ÷ÙÍÎÍÏÓÙùÍÎØÓÈÓÍÎÉ The declining economy and national fiscal credit problems have impacted Monroe, as they have all local governments. In response to this condition, the City has taken actions to offset possible budget shortfalls. In fiscal year 2011, these actions included hiring only essential personnel and transferring employees from within whenever possible and constant monitoring of operating expenses. In fiscal year 2012 all operations are being evaluated to establish cost/benefit analysis of all programs that are provided to our community. Based on this analysis, revenues and expenses are being adjusted to ensure that the City will be working within current operating revenues. City Council, management and staff are committed to providing the citizens of Monroe the highest quality of essential services throughout the economic decline and maintain the financial integrity our community expects. ûÅÛÊØÉÛÎØûÙÑÎÍÅÐ×ØÕ×Ï×ÎÈÉ ûÅÛÊØÉ. 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 th Comprehensive Annual Financial Report for the fiscal year ended June 30, 2010. This was the 18 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. ûÙÑÎÍÅÐ×ØÕ×Ï×ÎÈÉ The preparation of this report is a very intensive project, and could not have been accomplished without the assistance and dedication of the Finance Department staff and other personnel from various departments who assisted in its preparation. A particular thank you goes to Assistant Finance xiii Director Lisa Strickland and Budget Analyst Mary Lou Clark who have provided valuable assistance with 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. Respectfully submitted, Wayne Herron Greg Demko City Manager Assistant City Manager/Director of Finance xiv Certificate of Achievement for Excellence in Financial Reporting Presented to City of Monroe North Carolina For its Comprehensive Annual Financial Report for the Fiscal Year Ended June 30, 2010 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. President Executive Director xv ùóèãíöïíîêí÷ îíêèôùûêíðóîû ðóéèíöìêóîùóìûðíööóùóûðé òÇÎ×   Elected Officials Bobby G. Kilgore ïÛÃÍÊ Dottie M. Nash ïÛÃÍÊìÊÍè×Ï John B. Ashcraft, Jr. Billy A. Jordan Margaret Desio Lynn A. Keziah Freddie Gordon City Administration H. Wayne Herron, Jr. ùÓÈÃïÛÎÛÕ×Ê Brian J. Borne Greg Demko ûÉÉÓÉÈÛÎÈùÓÈÃïÛÎÛÕ×Ê øÍÅÎÈÍÅÎïÍÎÊÍ×ûÉÉÓÉÈÛÎÈùÓÈÃïÛÎÛÕ×Ê öÓÎÛÎÙ×øÓÊ×ÙÈÍÊ øÓÊ×ÙÈÍÊ Terry M. Sholar Bridgette H. Robinson ùÓÈÃûÈÈÍÊÎ×ÃùÓÈÃùÐ×ÊÑ R. Christopher Platé James N. Loyd, Jr. ÷Ä×ÙÇÈÓÆ×øÓÊ×ÙÈÍÊÍÖ÷ÙÍÎÍÏÓÙøÓÊ×ÙÈÍÊÍÖ÷ÎÕÓÎ××ÊÓÎÕ ø×Æ×ÐÍÌÏ×ÎÈÛÎØûÆÓÛÈÓÍÎ Debra C. Reed Lisa W. Stiwinter øÓÊ×ÙÈÍÊÍÖôÇÏÛÎê×ÉÍÇÊÙ×ÉøÓÊ×ÙÈÍÊÍÖìÐÛÎÎÓÎÕ Don D. Mitchell Debra C. Duncan øÓÊ×ÙÈÍÊÍÖ÷Î×ÊÕÃé×ÊÆÓÙ×ÉìÍÐÓÙ×ùÔÓ×Ö Ronald D. Fowler Bruce Bounds öÓÊ×ùÔÓ×ÖøÓÊ×ÙÈÍÊÍÖóÎÖÍÊÏÛÈÓÍÎè×ÙÔÎÍÐÍÕà C. Michael Courtney Russell G. Colbath øÓÊ×ÙÈÍÊÍÖìÛÊÑÉê×ÙÊ×ÛÈÓÍÎøÓÊ×ÙÈÍÊÍÖåÛÈ×Êê×ÉÍÇÊÙ×É xvi City Of Monroe, North Carolina Organizational Chart Citizens Mayor and City Council City Manager City Clerk City Attorney Assistant City Manager/ Assistant City Manager/ Finance Director Downtown Monroe Director Human Resources Director I I Engineeering Director I I I Economic Development and Aviation Director Police Chief I I Fire Chief I I I Information Technology Director Water Resources Director I I Planning Director Energy Services Director Parks and Recreation Director CITY OF �rIONROE a heritage of progress óîø÷ì÷îø÷îèûçøóèíêéê÷ìíêè 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, 2011, 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 õÍÆ×ÊÎÏ×ÎÈûÇØÓÈÓÎÕéÈÛÎØÛÊØÉ, 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 õÍÆ×ÊÎÏ×ÎÈûÇØÓÈÓÎÕéÈÛÎØÛÊØÉ. 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, 2011, 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 õÍÆ×ÊÎÏ×ÎÈûÇØÓÈÓÎÕéÈÛÎØÛÊØÉ, we have also issued our report dated November 1, 2011 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, grant agreements and other matters. The purpose of that report is to describe the scope of our testing of internal control over financial reporting and compliance and the results of that testing, and not to provide an opinion on the internal control over financial reporting or on compliance. That report is an integral part of an audit performed in accordance with õÍÆ×ÊÎÏ×ÎÈûÇØÓÈÓÎÕ éÈÛÎØÛÊØÉ and should be read in conjunction with this report in considering the results of our audit. Management’s Discussion and Analysis, the Law Enforcement Officers’ Special Separation Allowance Schedule and Other Postemployment Benefits (OPEB) Schedules of Funding Progress and 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 introductory section, the other supplementary information section, and the statistical section as listed in the accompanying table of contents as 1 Å×ÐÐÛÉÈÔ×ÛÙÙÍÏÌÛÎÃÓÎÕÉÙÔ×ØÇÐ×ÍÖ×ÄÌ×ÎØÓÈÇÊ×ÉÍÖÖ×Ø×ÊÛÐÛÎØÉÈÛÈ×ÛÅÛÊØÉÛÉÊ×ËÇÓÊ×ØÚÃçéíÖÖÓÙ×ÍÖ ïÛÎÛÕ×Ï×ÎÈÛÎØúÇØÕ×ÈùÓÊÙÇÐÛÊû ûÇØÓÈÉÍÖéÈÛÈ×ÉðÍÙÛÐõÍÆ×ÊÎÏ×ÎÈÉÛÎØîÍÎìÊÍÖÓÈíÊÕÛÎÓÂÛÈÓÍÎÉÛÎØ ÈÔ×éÈÛÈ×éÓÎÕÐ×ûÇØÓÈóÏÌÐ×Ï×ÎÈÛÈÓÍÎûÙÈÛÊ×ÌÊ×É×ÎÈ×ØÖÍÊÈÔ×ÌÇÊÌÍÉ×ÉÍÖÛØØÓÈÓÍÎÛÐÛÎÛÐÃÉÓÉÛÎØÛÊ×ÎÍÈÛ Ê×ËÇÓÊ×ØÌÛÊÈÍÖÈÔ×ÚÛÉÓÙÖÓÎÛÎÙÓÛÐÉÈÛÈ×Ï×ÎÈÉèÔ×ÍÈÔ×ÊÉÇÌÌÐ×Ï×ÎÈÛÊÃÓÎÖÍÊÏÛÈÓÍÎÛÎØÈÔ×ÉÙÔ×ØÇÐ×ÍÖ ×ÄÌ×ÎØÓÈÇÊ×ÉÍÖÖ×Ø×ÊÛÐÛÎØéÈÛÈ×ÛÅÛÊØÉÔÛÆ×Ú××ÎÉÇÚÒ×ÙÈ×ØÈÍÈÔ×ÛÇØÓÈÓÎÕÌÊÍÙ×ØÇÊ×ÉÛÌÌÐÓ×ØÓÎÈÔ×ÛÇØÓÈÍÖÈÔ× ÚÛÉÓÙÖÓÎÛÎÙÓÛÐÉÈÛÈ×Ï×ÎÈÉÛÎØÓÎÍÇÊÍÌÓÎÓÍÎÛÊ×ÖÛÓÊÐÃÉÈÛÈ×ØÓÎÛÐÐÏÛÈ×ÊÓÛÐÊ×ÉÌ×ÙÈÉÓÎÊ×ÐÛÈÓÍÎÈÍÈÔ×ÚÛÉÓÙ ÖÓÎÛÎÙÓÛÐÉÈÛÈ×Ï×ÎÈÉÈÛÑ×ÎÛÉÛÅÔÍÐ×èÔ×ÓÎÈÊÍØÇÙÈÍÊÃÉ×ÙÈÓÍÎÛÎØÈÔ×ÉÈÛÈÓÉÈÓÙÛÐÉ×ÙÈÓÍÎÔÛÆ×ÎÍÈÚ××ÎÉÇÚÒ×ÙÈ×Ø ÈÍÈÔ×ÛÇØÓÈÓÎÕÌÊÍÙ×ØÇÊ×ÉÛÌÌÐÓ×ØÚÃÇÉÓÎÈÔ×ÛÇØÓÈÍÖÚÛÉÓÙÖÓÎÛÎÙÓÛÐÉÈÛÈ×Ï×ÎÈÉÛÎØÛÙÙÍÊØÓÎÕÐÃÅ××ÄÌÊ×ÉÉÎÍ ÍÌÓÎÓÍÎÍÎÈÔ×Ï îÍÆ×ÏÚ×Ê   ïÍÎÊÍ×îÍÊÈÔùÛÊÍÐÓÎÛ ïÛÎÛÕ×Ï×ÎȪÉøÓÉÙÇÉÉÓÍÎÛÎØûÎÛÐÃÉÓÉ 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, 2011. 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. öÓÎÛÎÙÓÛÐôÓÕÔÐÓÕÔÈÉ The assets of the City of Monroe exceeded its liabilities at the close of the fiscal year by $331,576,535 (net assets). Of this amount, $115,032,659 (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 $10,079,035. This increase was the net of a decrease of $568,069 from governmental activities and an increase of $10,647,104 for business- type activities. As of the close of the current fiscal year, the City’s governmental funds reported combined ending fund balances of $21,759,508, an increase of $406,396 in comparison with the prior year. Approximately 21 percent of this total amount or $4,468,009 is non spendable or restricted by state law. At the end of the current fiscal year, unassigned fund balance for the General Fund was $13,041,611 or 51 percent of total general fund expenditures for the fiscal year. The City’s total debt not including compensated absences and OPEB liability, net of retirements, decreased $5,796,863 (6%) during the current fiscal year. The primary elements of the decrease was the issuance of an installment financing loan totaling $771,100 for equipment purchases, $395,000 in savings realized through refinancing the City’s Series 1998 and 2008B Combined Enterprise Fund Revenue bond issues and $6,172,963 in debt retirements. íÆ×ÊÆÓ×ÅÍÖÈÔ×öÓÎÛÎÙÓÛÐéÈÛÈ×Ï×ÎÈÉ 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. ê×ËÇÓÊ×ØùÍÏÌÍÎ×ÎÈÉÍÖûÎÎÇÛÐöÓÎÛÎÙÓÛÐê×ÌÍÊÈ öÓÕÇÊ×  Management’s Discussion Basic Financial and Analysis Statements Government-wideFund Financial Notes to the Financial Statements Statements Financial Statements Summary Detail 3 úÛÉÓÙöÓÎÛÎÙÓÛÐéÈÛÈ×Ï×ÎÈÉ 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. õÍÆ×ÊÎÏ×ÎÈåÓØ×öÓÎÛÎÙÓÛÐéÈÛÈ×Ï×ÎÈÉ 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. öÇÎØöÓÎÛÎÙÓÛÐéÈÛÈ×Ï×ÎÈÉ 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 maintains eight individual governmental funds. Information is presented separately in the governmental fund balance sheet and in the governmental fund statement of revenues, expenditures, and changes in fund balances for the General Fund which is considered to be a major fund. Data from the other seven governmental funds are combined into a single, aggregated presentation. Individual fund data for each of these non-major governmental funds is provided in the form of combining statements elsewhere in this report. These other seven governmental funds are made up of two capital projects funds and five special revenue funds including Community Development, Downtown Monroe, Occupancy Tax, City Grant Programs and State Grant Programs. 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 two types of proprietary funds: enterprise and internal service. 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, stormwater, sanitation and airport operations. These funds are the same as those functions shown in the business-type activities in the Statement of Activities. Internal service funds are an accounting tool used to accumulate and allocate costs internally among various functions. The City utilizes an internal service fund for its health, worker’s compensation and property and casualty insurance. Because services accounted for in the internal service fund predominately benefit governmental rather than business-type functions, it has been included within the governmental activities in the government-wide financial statements. 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 32 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 72 of this report. 5 õÍÆ×ÊÎÏ×ÎÈåÓØ×öÓÎÛÎÙÓÛÐûÎÛÐÃÉÓÉ The following is a summary of the City’s net assets for governmental and business-type activities for the current year as compared to the prior year. For more detail see the Statement of Net Assets on page 15. ùÓÈÃÍÖïÍÎÊÍתÉî×ÈûÉÉ×ÈÉ öÓÕÇÊ×  Governmental Activities Business-type Activities Total 2011 2010 2011 2010 2011 2010 Current and other assets $27,431,035 $25,542,119 $102,712,509 $101,007,280 $130,143,544 $126,549,399 Capital assets 78,428,606 81,505,564 231,667,778 226,582,766 310,096,384 308,088,330 Total assets 105,859,641 107,047,683 334,380,287 327,590,046 440,239,928 434,637,729 Long-term liabilities outstanding 8,520,184 8,582,025 84,571,338 88,137,311 93,091,522 96,719,336 Other liabilities 3,997,697 4,555,829 11,574,174 11,865,064 15,571,871 16,420,893 Total liabilities 12,517,881 13,137,854 96,145,512 100,002,375 108,663,393 113,140,229 Net assets: Invested capital assets, net of related debt 71,692,266 73,296,107 144,181,497 141,268,728 215,873,763 214,564,835 Restricted 670,113 254,874 - - 670,113 254,874 Unrestricted 20,979,381 20,358,848 94,053,278 86,318,943 115,032,659 106,677,791 Total net assets $93,341,760 $93,909,829 $238,234,775 $227,587,671 $331,576,535 $321,497,500 The total net assets of the City of Monroe were $331,576,535 as of June 30, 2011. Of the City’s total net assets $215,873,763 (65.1%) reflects its investment in capital assets (e.g. land, buildings, machinery, and equipment) less any related debt used to acquire those assets that is still outstanding. 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 ($670,113) represents resources that are subject to external restrictions on how they may be used. The remaining balance of $115,032,659 (34.7%) is unrestricted. These assets may be used at the City’s discretion in meeting its ongoing obligations to citizens and creditors. The City’s net assets have increased by $10,079,035 during the current fiscal year. The biggest part of this increase was due to increased cash provided by operating activities in the City’s electric, natural gas, and water and sewer operations. The airport also received $2,150,000 in capital grants from the Federal Aviation Administration. Restricted reserves represent the accumulation of funds from the state street aid allocation to be used for street maintenance. Unrestricted reserves represent increases due to savings in anticipated expenses and actual revenue exceeding anticipated revenue. The following is a summary of the City’s governmental and business-type activities for fiscal year 2011, including revenues and expenses, with a comparison to the prior year. For more detail see the Statement of Activities on page 16-17. 6 ùÓÈÃÍÖïÍÎÊÍתÉùÔÛÎÕ×ÉÓÎî×ÈûÉÉ×ÈÉ öÓÕÇÊ×  Governmental Activities Business-type Activities Total 2011 2010 2011 2010 2011 2010 Revenues: Program revenues: Charges for services $5,703,361 $5,630,582 $88,886,893 $89,719,118 $94,590,254 $95,349,700 Operating grants and contributions 1,987,614 2,238,247 -- 1,987,614 2,238,247 Capital grants and contributions 353,382 1,972,323 2,150,000 483,552 2,503,382 2,455,875 General revenues: Property taxes 19,314,219 16,953,881 -- 19,314,219 16,953,881 Other taxes 7,661,345 6,714,313 -- 7,661,345 6,714,313 Grants and contributions not restricted to specific grant programs 218,044 241,952 --218,044 241,952 Other 801,036 934,426 1,206,904 1,656,520 2,007,940 2,590,946 Total revenues 36,039,001 34,685,724 92,243,797 91,859,190 128,282,798 126,544,914 Expenses: General government $5,294,074 $4,951,760 $ - $ - $5,294,074 $4,951,760 Transportation 4,699,347 5,666,866 --4,699,347 5,666,866 Public safety 18,223,483 17,774,850 -- 18,223,483 17,774,850 Culture and recreation 4,545,094 4,906,281 -- 4,545,094 4,906,281 Economic and physical development 1,118,615 1,783,573 -- 1,118,615 1,783,573 Interest in long-term debt 107,325 161,494 -- 107,325 161,494 Water and sewer -- 11,955,438 11,520,115 11,955,438 11,520,115 Electrical - -46,839,672 43,587,914 46,839,672 43,587,914 Natural Gas -- 13,912,769 17,584,631 13,912,769 17,584,631 Aquatics and Fitness Center -- 3,548,935 3,435,820 3,548,935 3,435,820 Stormwater - - 1,709,000 1,351,596 1,709,000 1,351,596 Solid waste - - 2,696,873 2,702,185 2,696,873 2,702,185 Airport - - 3,553,138 3,498,087 3,553,138 3,498,087 Total expenses 33,987,938 35,244,824 84,215,825 83,680,348 118,203,763 118,925,172 (Decrease) Increase in net assets before transfers2,051,063 (559,100) 8,027,972 8,178,842 10,079,035 7,619,742 Transfers(2,619,132) (710,363) 2,619,132 710,363 -- (Decrease) Increase in net assets (568,069) (1,269,463) 10,647,104 8,889,205 10,079,035 7,619,742 Net assets – beginning 93,909,829 95,179,292 227,587,671 218,698,466 321,497,500 313,877,758 Net assets – ending $93,341,760 $93,909,829 $238,234,775 $227,587,671 $330,326,535 $321,497,500 Governmental activities – Governmental activities decreased the City of Monroe’s net assets by $568,069. Key elements of this net decrease are as follows: An increase in property taxes of 13.9% ($2,360,338), due primarily to an increase of $.06 per $100 of assessed value in the real estate property tax rate. Capital grants and contributions decreased by $1,618,941. This was due to a decrease in the transportation function of $1,186,975 and in the economic development function of $785,348 and an increase the public safety function of $49,355 and in the parks and recreation function of $304,027. The decrease in transportation revenue is the result of no additions of infrastructure which includes streets, curbs, sidewalks and stormwater in FY 2011. An increase of $947,032 or 14.1% was reported in other taxes due primarily to a $383,645 increase in collection for privilege licenses which is the result of a rate increase and an $114,839 increase in collection for beer and wine tax. The State General Assembly retained a higher level of the beer and wine tax distribution for one year in FY 2010. This revenue has been restored back to the full distribution rate in FY 2011. A decrease in transportation expense occurred due to road improvements that were completed in FY 2010. Transfers out increased primarily due to transfers from the General Fund to both the airport and health and dental self insurance fund. 7 Business-type activities – Business-type activities increased the City of Monroe’s net assets by $10,647,104 accounting for 105% of the total net growth in the government’s net assets. Key elements of this increase are as follows: Charges for services increased slightly in the water and sewer, stormwater, solid waste, airport and aquatics and fitness center funds. Electric revenue increased significantly due to a rate increase of 5% to offset increased rates for the purchase of wholesale power. Natural gas revenue decreased primarily due to a one-time receipt in FY 2010 of $6,000,000 pursuant to an agreement with Public Service Company of North Carolina. The remainder of the decrease was due to a reduction in the cost of natural gas purchases for resale that has been passed on to the customers. The increase in capital grants and contributions was due grants received from the Federal Aviation Administration for airport improvements. A decrease in other revenues of $449,616 was due primarily to decreased investment interest earnings. The increase in transfers in was due to transfers for airport improvements. öÓÎÛÎÙÓÛÐûÎÛÐÃÉÓÉÍÖÈÔ×ùÓÈêÉöÇÎØÉ 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, unassigned fund balance can be a useful measure of a government’s net resources available for spending at the end of the fiscal year. At June 30, 2011, the governmental funds of City of Monroe reported a combined fund balance of $21,759,508, which is an increase of $406,396 from last year’s total of $21,353,112. Of the governmental funds combined ending fund balances, $13,041,611 represents unassigned fund balance, which is available for spending at the City’s discretion. The remainder of fund balance is classified in three categories: 1). Non spendable to indicate that it is not available for spending, as it is not in spendable form; 2). Restricted to indicate that it is restricted to specific purposes as imposed by law; or 3). Assigned to indicate that it is intended to be used for a specific purpose. More information about fund balance is available in section I.E.12 and section VIII. in the notes to the financial statements. The general fund is the chief operating fund of the City of Monroe. As of June 30, 2011, the fund balance in the General Fund was $20,478,381, an increase of $852,797 in comparison with the prior year. Of the total fund balance in the General Fund, $13,041,611 (63.7%) was unassigned fund balance. Of this amount, $7,701,463 is reserved by a minimum fund balance policy that has been adopted by City Council. As a measure of the general fund’s liquidity, it may be useful to compare both unassigned fund balance and total fund balance to total fund expenditures. Unassigned fund balance represents 51% of total general fund expenditures, while total fund balance represents 80% of that same amount. The increase in fund balance is the net effect of several components including revenue exceeding projections, savings in expenditures and transfers of available fund balance for projects and debt retirement. The Other Government Funds which consist of the Capital Projects Fund, Occupancy Tax Projects Fund and special revenue funds for Community Development, Downtown Monroe, Occupancy Tax, City Grant Programs and State Grant Programs also impact the total fund balance for governmental funds. The reason for the decrease of $446,401 in this category is due primarily to the transfer of funds from the City Grant Program Fund. The fund did not meet the criteria of a special revenue fund and has been combined with the general fund. The remainder of the decrease was due to the appropriation of the remaining fund balance for Downtown Monroe Fund to offset the transfer from general fund. 8 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. Unrestricted Net Assets Growth in Net Assets 2011 201020112010 Water and Sewer $22,353,418 $21,869,547 $503,526 $1,098,927 Electric 50,530,631 49,205,975 5,370,319 621,632 Natural Gas 16,455,381 17,196,135 1,306,514 6,973,655 Airport 1,860,716 (4,424,894) 2,935,584 (791,393) Aquatics and Fitness Center 2,072,050 1,838,011 401,263 513,695 Stormwater 467,405 368,47281,918413,803 Solid Waste 485,789 357,810 127,979 141,753 Proprietary Funds are used to account for operations (a) that are financed and operated in a manner similar to private business enterprises where the intent of the governing body is that the costs (expenses, including depreciation) of providing goods or services to the general public on a continuing basis be financed or recovered primarily through user charges; or (b) where the governing body has decided that periodic determination of revenues earned, expenses incurred, and/or net income is appropriate for capital maintenance, public policy, management control, accountability, or other purposes. The City’s major proprietary funds are water and sewer, electric, natural gas and airport. Minor proprietary funds include Aquatics and Fitness Center, Stormwater and Solid Waste Funds. The Water and Sewer Fund accounts for the provision of potable water and sewer service to City and non-City residents. All activities necessary to the provision of these services are accounted for in this fund, including, but not limited to administration, plant and line maintenance. As of June 30, 2011, the City of Monroe’s water fund reported total net assets of $72,789,592, an increase of $503,526 in comparison with the prior year. This increase is primarily due to an increase in operating income netted with a transfer to the electric fund for a new customer service building. The Electric Fund accounts for the provision of electric service to City and non-City residents. All activities necessary to the provision of these services are accounted for in this fund, including, but not limited to administration, plant and line maintenance. As of June 30, 2011, the City of Monroe’s electric fund reported total net assets of $98,814,024, an increase of $5,370,319 in comparison with the prior year. Approximately half of this increase is due to an increase in operating income. Electric rates were increased by 5% to offset a wholesale power rate increase. The other half of this increase was due to transfers from the Water Fund and Natural Gas Fund for their proportionate share of the purchase and remodeling of a new customer service building and a new energy services building. The Natural Gas Fund accounts for the provision of natural gas service to City and non-City residents. All activities necessary to the provision of these services are accounted for in this fund, including, but not limited to administration, plant and line maintenance. As of June 30, 2011, the City of Monroe’s natural gas fund reported total net assets of $39,772,718, an increase of $1,306,514 in comparison with the prior year. This increase is primarily due to an increase in operating income. The new 43-mile pipeline that connects the City’s system to the transcontinental pipeline has been in service for the entire fiscal year enabling the City to realize a full year in savings for transport charges totaling $2,520,000. The Natural Gas Fund also transferred its proportionate share of the purchase and remodeling of a new customer service building and a new energy services building. The Airport Fund accounts for the operation of the Charlotte-Monroe Executive Airport. As of June 30, 2011, the City of Monroe’s airport fund reported total net assets of $16,921,017, an increase of $2,935,584 in comparison with the prior year. This increase is because of the receipt of a grants totaling $2,150,000 for runway improvements and transfers from the General Fund for capital improvements totaling $243,900. The airport is currently undergoing a major renovation and expansion. The airport 9 was awarded a grant in May 2011 in the amount of $2,600,000 for the runway strengthening portion of the expansion. Using savings realized from the projects and a general fund contribution in the amount of $633,031, the airport has paid back the advance of $7,710,122 from the electric fund. õ×Î×ÊÛÐöÇÎØúÇØÕ×ÈÛÊÃôÓÕÔÐÓÕÔÈÉ During the fiscal year, the City of Monroe revised the budget on several occasions. Generally, budget amendments are either amendments made to adjust the estimates that are used to prepare the original budget ordinance once updated information is available or amendments made to recognize new funding amounts from external sources, such as federal and State grants. Total amendments to the General Fund increased expenditures by $1,556,968 or 5.8%. 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 $92,645 and unspent appropriations (various grants and police equitable sharing) in the amount of $430,293. Funds were appropriated for an airport capital project and to assist in the pay off of the airport loan from the electric fund in the amount of $876,931. Funds were appropriated to establish a reserve in the Health and Dental Self Insurance Fund in the amount of $570,420. Funds in the amount of $211,008 were returned to the General Fund from the City Grant Program Fund to close the fund. Revenues exceeded final budget by $1,300,497. This was primarily due to increased collections for property taxes and sales tax. Expenditures decreased from the prior year and were under budget by $2,751,781. Expenses were down primarily due to savings realized from vacant positions due to a hiring freeze totaling approximately $465,918, savings in operating expenses totaling approximately $1,536,870, and savings for unspent drug seizure money and incentive grants totaling $469,686. Expenditures were 90% of the final amended expenditure budget. ùÛÌÓÈÛÐûÉÉ×ÈÉ The following is a summary of the City of Monroe’s capital assets, net of depreciation for governmental and business-type activities for the current year with a comparison to the prior year. Additional information on the City of Monroe’s capital assets can be found in Note IV.A.5 on pages 43 - 47 of this report. ùÓÈÃÍÖïÍÎÊÍתÉùÛÌÓÈÛÐûÉÉ×ÈÉ î×ÈÍÖø×ÌÊ×ÙÓÛÈÓÍÎ öÓÕÇÊ× Governmental Activities Business-type Activities Total 2011 2010 2011 2010 2011 2010 Land $4,760,642 $4,676,942 $16,364,736 $15,393,766 $21,125,378 $20,070,708 Buildings and improvements 13,471,076 12,568,101 27,793,427 29,013,338 41,264,503 41,581,439 Equipment 1,671,162 1,555,085 4,163,083 4,079,507 5,834,245 5,634,592 Vehicles and motorized equipment 2,989,438 3,975,347 2,351,471 2,414,622 5,340,909 6,389,969 Other Intangibles 276,253 344,696 - - 276,253 344,696 Infrastructure 55,254,943 57,289,776 155,467,165 100,889,358 210,722,108 158,179,134 Construction in progress 5,092 1,095,617 25,527,896 74,792,175 25,532,988 75,887,792 Total $78,428,606 $81,505,564 $231,667,778 $226,582,766 $310,096,384 $308,088,330 The City of Monroe’s investment in capital assets for its governmental and business–type activities as of June 30, 2011, totals $310,096,384 (net of accumulated depreciation). These assets include buildings, roads and bridges, land, enterprise systems infrastructure, machinery and equipment, park facilities, and 10 vehicles. The total increase in the City’s investment in capital assets for the current fiscal year was $2,008,054. Major capital asset events during the year included the following: Completion of Armory Phase II Completion of the gymnasium at J Ray Shute Recreation Center Replacement of the Wastewater Treatment Plant generator Utility relocation on Martin Luther King Boulevard Completion of a new electric substation at the airport Completion of the upgrade of the electric substation at Hwy 601 S Replacement of transformers at two substations Goldmine Road construction 43 miles of natural gas pipeline to connect to the transcontinental pipeline Land acquisition for airport expansion Construction in progress totaling $25,532,988 has significantly decreased from last year. Projects included in this amount are as follows: Water – Stewart Creek sewer outfall and pump station replacement. Electric – construction of approximately 12.8 miles of transmission loop around the City and the purchase and remodeling of a new energy services building and customer service building. Natural Gas – land acquisition and construction of a 6” natural gas line loop around the City. Airport – extension and strengthening of runway 5. ø×ÚÈûØÏÓÎÓÉÈÊÛÈÓÍÎ The following is a summary of the City’s long-term debt for governmental and business-type activity for the current year with a comparison to the prior year. Additional information on long-term debt can be found in note IV.B.7 beginning on page 56 of this report. ùÓÈÃÍÖïÍÎÊÍתÉíÇÈÉÈÛÎØÓÎÕø×ÚÈ õ×Î×ÊÛÐíÚÐÓÕÛÈÓÍÎÛÎØê×Æ×ÎÇ×úÍÎØÉ öÓÕÇÊ× Governmental Activities Business-type Activities Total 2011 2010 2011 2010 2011 2010 Install purchase obligations $6,736,340 $8,209,458 $3,069,273 $3,625,941 $9,805,613 $11,835,399 Revenue bonds - - 48,980,000 51,320,000 48,980,000 51,320,000 State revolving loans - - 3,450,676 4,277,753 3,450,676 4,277,753 Certificates of participation - - 32,065,000 32,665,000 32,065,000 32,665,000 Total $6,736,340 $8,209,458 $87,564,949 $91,888,694 $94,301,289 $100,098,152 As of June 30, 2011, the City of Monroe had total debt outstanding of $94,301,289. The City’s bonded debt, $48,980,000, represents bonds secured by the combined revenues of the major business-type funds which include water and sewer, electric, natural gas and airport. The certificates of participation were issued to fund the construction of a natural gas pipeline. The City’s total debt, net of retirements, decreased $5,796,863 during the fiscal year. The primary elements of this change were issuance of an installment financing totaling $771,100 for equipment purchases, $395,000 in savings realized through refinancing the City’s Series 1998 and 2008B Combined Enterprise Fund Revenue bond issues and $6,172,963 in debt retirements. The City of Monroe has an A2 bond rating from Moody’s Investor Service and AA- rating from Standard and Poor’s Corporation. These bond ratings are indications of the sound financial condition and stable outlook of the City of Monroe. 11 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 $235,387,906. ÷ÙÍÎÍÏÓÙöÛÙÈÍÊÉÛÎØî×ÄÈã×ÛʪÉúÇØÕ×ÈÉÛÎØêÛÈ×É The following key economic indicators reflect the growth and prosperity of the City. The annual unemployment rate for City of Monroe has risen to 9.7%, which is an increase of 0.7% from last year. This rate is comparable to Union County’s rate of 9.5% and the State’s average rate of 10.4%. The taxable value of commercial and residential property increased 2.0% from fiscal year 2010 to fiscal year 2011. Population decreased 15.5% from 38,120 in 2010 to 33,007 in 2011. This decrease is the result of adjusting estimated amounts to the US Census count in 2010. Monroe is experiencing the same downturn in the economy as our industrial, commercial and residential sectors. Revenues have declined and yet operating expenses have continued to rise as the costs of goods and services to the City have increased. Governmental Activities – The City maintained the property tax rate of .555 for fiscal year 2012. Expenditures and services were budgeted to remain at the same level as fiscal year 2011. Business-type Activities – Water and sewer rates were increased by 4.5% to plan for the significant anticipated cost of future capital projects and necessary system improvements. The Water and Sewer Enterprise Fund has received final approval for a state revolving loan in FY 2012 in the amount of approximately $10.3 million for the Stewart Creek Sewer Upgrade Project. Electric rates were also increased by 7.0% to cover the increased cost of wholesale power. Solid waste, natural gas and stormwater rates remained the same. ê×ËÇ×ÉÈÉÖÍÊóÎÖÍÊÏÛÈÓÍÎ This report is designed to provide an overview of the City’s finances for those with an interest in this area. Questions concerning any of the information found in this report or requests for additional information should be directed to the City of Monroe Department of Finance at 300 West Crowell Street, . Monroe, North Carolina, 28112, or visit the City’s website at www.monroenc.org 12 Basic Financial Statements The Basic Financial Statements provide a summary overview of the financial position of the governmental activities, the business -type activities, the discretely presented component unit, each major fund, and the aggregate remaining fund information at June 30, and the respective changes in financial position and cash flows, where appropriate for the year then ended. • Government -Wide Financial Statements • Fund Financial Statements Governmental Fund Financial Statements Proprietary Fund Financial Statements • Notes to Financial Statements • Required Supplemental Information CITY OF .�IONROE a heritage of progress XHIBIT 1 E CITY OF MONROE, NORTH CAROLINA TATEMENT OF NET ASSETS S une 30, 2011 J ùÍÏÌÍÎ×ÎÈçÎÓÈ ìÊÓÏÛÊÃõÍÆ×ÊÎÏ×Î É È ïÍÎÊÍ× èÍÇÊÓÉÏ õÍÆ×ÊÎÏ×ÎÈÛÐúÇÉÓÎ×ÉÉÈÃÌ×ùÓÈÃÍÖïÍÎÊÍ× ø×Æ×ÐÍÌÏ×ÎÈ ûÙÈÓÆÓÈÓ×ÉûÙÈÓÆÓÈÓ×ÉèÍÈÛÐûúùúÍÛÊØûÇÈÔÍÊÓÈà ûéé÷èé Current assets: Cash and cash equivalents21,619,977$ 80,906,895$ 102,526,872$ 545,796$ 137,956$ Taxes receivable1,211,970- 1,211,970 - - Accounts receivable 493,7276,702,111 7,195,838 - 29,987 Note receivable- 1,459,931 1,459,931 - - Internal balances172,112 (172,112) - - - Due from other governments2,695,445- 2,695,445 - - Due from component units51,659 - 51,659 - - Inventories302,0084,137,898 4,439,906 237,746 - Prepaids 49,225 - 49,225 18,079 7,560 Loans receivable (net)16,773-16,773-- Tota current assets26,612,89693,034,723119,647,619 175,503801,621 l Restricted assets: an cas equvaents670,1131,123,3541,793,467-- Cas hdhil Noncurrent assets: Note receivable1,250,0005,879,404 7,129,404 - - Due from (to) other funds(1,171,306)1,171,306 - - - Deferred charges- 1,503,722 1,503,722 - - Prepaid pension obligation69,332- 69,332 - - Capital assets Landnon,--depreciableimprovements, Landnondepreciableimprovements and construction in progress4,765,734 41,892,632 46,658,366 317,013 - 189,775,146 263,438,018 744,155 - Other capital assets, net of depreciation73,662,872 Total capital assets78,428,606231,667,778310,096,384 -1,061,168 Total noncurrent assets78,576,632240,222,210318,798,842 -1,061,168 Total assets 334,380,287105,859,641 440,239,928 1,862,789 175,503 ðóûúóðóèó÷é Current liabilities: Accounts payable and accrued liabilities664,3755,835,037 6,499,412 320,474 3,020 Unearned revenue592,73032,702 625,432 - - Due to primary government- - - 32,500 19,159 Current portion of long-term liabilities2,574,8175,136,441 7,711,258 - - Payable from restricted assets- 569,994 569,994 - - Property claims liability 5,974 - 5,974 - - Workers compensation claims - - - - - Health care benefits claims159,801 - 159,801 - - Long-term liabilities: OPEB liability2,694,7661,157,893 3,852,659 - - Duen more tan one yea5,825,41883,413,44589,238,863-- ihr Total liabilities12,517,88196,145,512108,663,393 22,179352,974 î÷èûéé÷èé Invested in capital assets, net of related debt71,692,266 144,181,497 215,873,763 1,061,168 - Restricted for: Streets670,113 - 670,113 - - Other purposes- - - 131,580 - Unrestricted20,979,381 94,053,278 115,032,659 317,067 153,324 Total net assets93,341,760$$238,234,775$331,576,535$ 153,3241,509,815$ The notes to the financial statements are an integral part of this statement. 15 CITY OF MONROE, NORTH CAROLINA STATEMENT OF ACTIVITIES For the Year Ended June 30, 2011 ìÊÍÕÊÛÏê×Æ×ÎÇ×É íÌ×ÊÛÈÓÎÕ õÊÛÎÈÉùÛÌÓÈÛÐõÊÛÎÈÉ ùÔÛÊÕ×ÉÖÍÊÛÎØÛÎØ ÷ÄÌ×ÎÉ×Éé×ÊÆÓÙ×ÉùÍÎÈÊÓÚÇÈÓÍÎÉùÍÎÈÊÓÚÇÈÓÍÎÉ öÇÎÙÈÓÍÎÉ ìÊÍÕÊÛÏÉ ìÊÓÏÛÊÃÕÍÆ×ÊÎÏ×ÎÈ Governmental activities: General government5,294,074$ 1,955,543$ -$ -$ Transportation4,699,347202,043 1,032,439- Public safety18,223,4832,311,411616,06349,355 Culture and recreation4,545,0941,231,594203,890304,027 Economic and physical development1,118,6152,770135,222- Interest on long-term debt107,325 - - - Tota governmenta actvtes,7,5,7,,7,5, lliii33989380336119861433382 Business-type activities: Water and sewer11,955,438 12,916,600 - - Electric46,839,672 48,453,786 - - Natural gas13,912,769 17,319,708 - - Aquatics and Fitness Center3,548,935 3,927,181 - - Stormwater1,709,000 1,793,744 - - Solid waste2,696,873 2,822,596 - - Airport3,553,138 1,653,278 - 2,150,000 Totausness-type actvtes,5,5,,-,5, lbiiii84218288886893210000 Tota prmary governmen,,7,5,5,7,,5, lit$11820363$949024$198614$203382 ùÍÏÌÍÎ×ÎÈÇÎÓÈÉ ABC Board4,405,584$ 4,463,342$ -$ -$ Toursm Deveopmentutort,- -,7 ilAhiy34111029914 Tota component unts,7,,, -,7 li$446694$4463342$29914$ 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 Tota genera revenues an transers lldf Change in net assets Net assets, beginning Net assets, ending The notes to the financial statements are an integral part of this statement. 16 XHIBIT 2 E î×È÷ÄÌ×ÎÉ×ê×Æ×ÎÇ×ÛÎØùÔÛÎÕ×ÉÓÎî×ÈûÉÉ×ÈÉ ùÍÏÌÍÎ×ÎÈçÎÓÈÉ ìÊÓÏÛÊÃõÍÆ×ÊÎÏ×Î È ïÍÎÊÍ× èÍÇÊÓÉÏ õÍÆ×ÊÎÏ×ÎÈÛÐúÇÉÓÎ×ÉÉÈÃÌ×ùÓÈÃÍÖïÍÎÊÍ×ø×Æ×ÐÍÌÏ×ÎÈ ûÙÈÓÆÓÈÓ×ÉèÍÈÛÐûúùúÍÛÊØûÇÈÔÍÊÓÈà ûÙÈÓÆÓÈÓ×É $ -(3,338,531)$ (3,338,531)$ -$ -$ (3,464,865) (3,464,865)- - - (15,246,654) (15,246,654)- - - (2,805,583) (2,805,583)- - - (980,623) (980,623)- - - -(107,325) (107,325) - - -5,,5 -5,,5- (294381)(294381) 961,162- 961,162 - - 1,614,114- 1,614,114 - - 3,406,939- 3,406,939 - - 378,246- 378,246 - - 84,744- 84,744 - - 125,723- 125,723 - - 250,140- 250,140 - - -,, -,,- 68210686821068 5,,5,, -,,5- $(294381)$6821068$(1912213)$$ $ --$ -$ 57,758$ -$ -- --, (41396) -- -57,75, 8(41396) 19,314,219 19,314,219- - - 3,905,931 3,905,931- - - 1,543,148 1,543,148- - - 2,212,266 2,212,266- - - 218,044 218,044- - - 64,286288,976 353,262 2,659 271 725,575857,765 1,583,340 6,339- 11,175 60,163 71,338 - - 2,619,132(2,619,132) - - - 5,75,5,,,,5,5, 2312382603629201482696610 10,647,104(568,069) 10,079,035 60,417 (34,786) 227,587,671 321,497,500 1,449,398 188,110 93,909,829 238,234,775$ 331,576,535$ 1,509,815$ 153,324$ $93,341,760 17 XHIBIT 3 E CITY OF MONROE, NORTH CAROLINA ALANCE SHEE BT GOVERNMENTAL FUND S une 30, 2011 J íÈÔ×ÊèÍÈÛÐ õÍÆ×ÊÎÏ×ÎÈÛÐõÍÆ×ÊÎÏ×ÎÈÛÐ öÇÎØÉöÇÎØÉ õ×Î×ÊÛÐ ûéé÷èé Cash and cash equivalents17,763,803$ 1,263,262$ 19,027,065$ Receivables: Taxes 1,179,60032,370 1,211,970 Accounts 383,2071,232 384,439 Due from other governments 2,647,25248,193 2,695,445 32,500 19,15951,659 Due from component uni t Inventories302,008 302,008- Prepaids29,164 -29,164 Loans receivable (net)- 16,77316,773 - 670,113 Cash and cash equivalents - restricted670,113 Total assets23,007,647$ 1,380,989$ 24,388,636$ ðóûúóðóèó÷éûîøöçîøúûðûîù÷é Liabilities: Accounts payable and accrued liabilities613,667$ 50,718$ 664,385$ Deferred revenue1,322,86949,144 1,372,013 - 592,730 Unearned revenue592,730 Total liabilities2,529,266 99,862 2,629,128 Fund balances: on Spendable N Inventories302,008- 302,008 Prepaids29,164- 29,164 Restricted Stabilization by State Statute3,460,359 6,365 3,466,724 Streets670,113- 670,113 Assigne d Community Developmen 53,470- 53,470 t Downtown Monro (134)- (134) e Capital Projects- 35,875 35,875 Occupancy Tax Capital Projects- 1,185,551 1,185,551 Subsequent year's expenditures2,975,126 - 2,975,126 Unassigned13,041,611 - 13,041,611 Total fund balances20,478,381 1,281,127 21,759,508 1,380,989$ 24,388,636$ Total liabilities and fund balances23,007,647$ The notes to the financial statements are an integral part of this statement. 18 XHIBIT E4 CITY OF MONROE, NORTH CAROLINA RECONCILIATION OF GOVERNMENTAL FUND S ALANCE SHEET TO THE STATEMENT OF NET ASSETS B une 30, 2011 J Amounts reported for governmental activities in th e statement of net assets are different because: Fund balances - total governmental funds (Exhibit 3)21,759,508$ Capital assets used in governmental activities are no t financial resources and therefore are not reported in the funds. Gross capital assets at historical cost131,455,276$ Accumulated depreciation(53,026,670) 78,428,606 Other long-term assets are not available to pay for current period expenditures and therefore are deferred in the funds. Prepaid pension obligation 69,332 Note receivable from outside party 1,250,000 Internal service funds are used by management to charge the costs of health and dental insurance to individual funds. The current assets and liabilities of the internal service fund are included in governmental actvtesn te statement o net assets., activitiesinthestatementofnetassets976156 iiiihf976156 Internal service funds are used by management to charge the costs of workers' compensation to individual funds. The current assets and liabilities of the internal service fund are included in governmental activities in the statement of net assets.1,098,033 Internal service funds are used by management to charge the costs of property and liabiltiy insurance to individual funds. The current assets and liabilities of the internal service fund are included in governmental activities in the statement of net assets. 482,304 Internal balance due from Business Type Activities to Governmental Activities.172,112 Liabilities for earned but deferred revenues in fund statements.1,372,016 ote payable to electric fund (1,171,306) N Long-term liabilities are not due and payable in the current period and therefore are not reported in the funds (Note II.A.).(11,095,001) Net assets of governmental activities (Exhibit 1)93,341,760$ The notes to the financial statements are an integral part of this statement. 19 EXHIBIT 5 CITY OF MONROE, NORTH CAROLINA STATEMENT OF REVENUES, EXPENDITURES, AND CHANGES IN FUND BALANCES -- GOVERNMENTAL FUNDS For the Year Ended June 30, 2011 íÈÔ×ÊèÍÈÛÐ õÍÆ×ÊÎÏ×ÎÈÛÐõÍÆ×ÊÎÏ×ÎÈÛÐ õ×Î×ÊÛÐöÇÎØÉöÇÎØÉ ê÷æ÷îç÷é Ad valorem taxes$ 50,28519,166,334$ 19,216,619$ Other taxes and licenses939,729 308,984 1,248,713 Unrestricted intergovernmental6,586,186 - 6,586,186 Restricted intergovernmental1,760,001 639,057 2,399,058 Program income- 2,400 2,400 Sales and services1,708,256 - 1,708,256 Investment earnings61,318 2,968 64,286 Miscellaneous746,600 523 747,123 Total revenues30,968,424 1,004,217 31,972,641 ÷äì÷îøóèçê÷é Current: General government3,280,002 - 3,280,002 Transportation1,973,334 - 1,973,334 Public safety14,378,372 - 14,378,372 Culture and recreation4,092,302 - 4,092,302 Economic and physical development- 2,044,927 2,044,927 Capital outlay- 487,578 487,578 Debt service: Principal retirement1,961,757 - 1,961,757 Interest and other charges60,964 - 60,964 Total expenditures25,746,731 2,532,505 28,279,236 Deficiency of revenues under expenditures5,221,693 (1,528,288) 3,693,405 íèô÷êöóîûîùóîõéíçêù÷éçé÷é Transfers from other funds220,278 1,305,697 1,525,975 Transfers to other funds(4,721,297) (223,810) (4,945,107) Repayment of advance from other funds(131,477) - (131,477) Installment purchase obligations issued 263,600 - 263,600 Total other financing sources (uses)(4,368,896) 1,081,887 (3,287,009) Net change in fund balances852,797 (446,401) 406,396 Fund balance, beginning19,625,584 1,727,528 21,353,112 Fund balance, ending20,478,381$ 1,281,127$ 21,759,508$ The notes to the financial statements are an integral part of this statement. 20 EXHIBIT 6 CITY OF MONROE, NORTH CAROLINA RECONCILIATION OF THE STATEMENT OF REVENUES, EXPENDITURES, AND CHANGES IN FUND BALANCES OF GOVERNMENTAL FUNDS TO THE STATEMENT OF ACTIVITIES For the Year Ended June 30, 2011 Amounts reported for governmental activities in the statement of activities are different because: Net change in fund balances - total governmental funds (Exhibit 5)406,396$ 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 II.B.). (3,055,197) 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. (21,761) 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 118,292 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 ididiilihdbifiidh 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 II.B.).1,473,118 Loan made to outside party 1,250,000 Principal repayment of advance from Electric Fund85,116 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 (125,627) Net pension obligation (59,998) OPEB liability(1,093,108) (1,278,733) The internal service fund, determined to be governmental fund type, is used by management to charge the costs, net of investment earnings, of health and dental insurance program. 865,891 enterna servceun,etermne to e governmentaun type, s use Thilifddidblfdid y management to carge te costs, net onvestment earnngs, o worers bhhfiifk' compensation program. (444,193) enterna servceun,etermne to e governmentaun type, s use Thilifddidblfdid y management to carge te costs, net onvestment earnngs, o property bhhfiif anatynsurance program., dlibilii33002 Change in net assets of governmental activities (Exhibit 2)$(568,069) The notes to the financial statements are an integral part of this statement. 21 CITY OF .�IONROE a heritage of progress XHIBIT 7 E CITY OF MONROE, NORTH CAROLINA STATEMENT OF REVENUES, EXPENDITURES, AND CHANGE S IN FUND BALANCES -- BUDGET AND ACTUAL -- GENERAL FUND For the Year Ended June 30, 2011 æÛÊÓÛÎÙ×ÅÓÈÔ úÇØÕ×È×ØûÏÍÇÎÈÉöÓÎÛÐúÇØÕ×È ûÙÈÇÛÐìÍÉÓÈÓÆ× íÊÓÕÓÎÛÐöÓÎÛÐûÏÍÇÎÈÉî×ÕÛÈÓÆ× ê÷æ÷îç÷é Ad valorem taxes$ 18,299,195$ 18,417,711$ 19,166,334$ 748,623 Other taxes and licenses974,540974,540939,729 (34,811) Unrestricted intergovernmental5,740,8915,740,8916,586,186 845,295 Restricted intergovernmental1,159,4001,756,5881,760,001 3,413 Sales and services1,859,6281,836,2731,708,256 (128,017) Investment earnings400,000400,00061,318 (338,682) Miscellaneous 541,924666,342 746,600 204,676 Total revenues29,099,996 29,667,927 30,968,424 1,300,497 ÷äì÷îøóèçê÷é Current: General government3,957,9554,360,2273,280,0021,080,225 Transportation2,602,8992,707,9411,973,334734,607 Public safety14,054,32115,008,92814,378,372630,556 Culture and recreation4,301,6754,396,7224,092,302304,420 Debt service: Principal retirement1,624,6941,624,6941,961,757(337,063) Interest and other charges 400,000400,000 60,964 339,036 Total expenditures26,941,544 28,498,512 25,746,731 2,751,781 Revenues over (under) expenditures2,158,452 1,169,415 5,221,693 4,052,278 íèô÷êöóîûîùóîõéíçêù÷éçé÷é Transfers from other funds 9,000220,008220,278 270 Transfers to other funds (4,155,541) (5,081,040) (4,721,297) 359,743 Repayment of advance from other funds (131,480) (131,478) (131,477) (1) Installment purchase obligations issued 285,000285,000 263,600 (21,400) Total other financing sources (uses)(3,993,021) (4,707,510) (4,368,896) 338,612 öçîøúûðûîù÷ûììêíìêóûè÷ø 1,834,5693,538,095-(3,538,095) Net change in fund balance$ --$ 852,797 852,797$ Fund balance, beginning19,625,584 Fund balance, ending$20,478,381 The notes to the financial statements are an integral part of this statement. 23 CITY OF MONROE, NORTH CAROLINA TATEMENT OF NET ASSETS S ROPRIETARY FUND PS une 30, 2011 J ïÛÒÍÊ÷ÎÈ×ÊÌÊÓÉ×öÇÎØÉ åÛÈ×Ê ÛÎØé×Å×Ê÷Ð×ÙÈÊÓÙîÛÈÇÊÛÐõÛÉûÓÊÌÍÊÈ ûéé÷èé Current assets: Cash and cash equivalents21,934,321$ 39,053,157$ 15,354,945$ 1,348,733$ Accounts receivable1,032,545 3,675,495 792,183434,932 Note receivable- 541,768 918,163- Prepaid expenses- - - - Inventories285,1183,569,770 75,710195,756 Total current assets23,251,98446,840,190 1,859,37517,261,047 Noncurrent assets: Restricted assets: Cash and cash equivalents: Unspent bond proceeds22,525 9,654 4,194 58,969 Customer deposits74,885354,499140,610- Bond issuance costs 173,950404,827709,887215,058 Due from other funds - 6,243,530- - Long-term note receivable- 1,764,761 4,114,643- Capital assets: Land and other non-depreciable assets1,294,760 18,132,002 4,985,695 16,554,581 54,334,200 10,910,94354,678,388 Other capital assets, net of depreciation62,658,674 Capital assets (net)63,953,43472,466,202 27,465,52459,664,083 Tota noncurrent assets64,224,79481,243,473 27,739,55164,633,417 l Tota assets87,476,778128,083,663 29,598,92681,894,464 l ðóûúóðóèó÷é Current liabilities: Accounts payable and accrued liabilities 346,126 4,366,351 516,740109,238 Unearned revenue 9,516- - - Compensated absences 156,237 89,625 31,105 9,843 Installment purchase obligations 79,556 302,898 67,026 48,119 Certificates of participation - 608,452- - Revenue bonds payable 509,746 755,644 166,924 915,172 827,077 --- State revolving loans payabl e Total current liabilities1,918,7425,524,034 1,082,3721,390,247 Liabilities payable from restricted assets: Customer deposits74,885 354,499 140,610 - Noncurrent liabilities: Due to other funds - - 4,960,920- Compensated absences76,951 44,145 15,318 4,848 Installment purchase obligations 78,693 728,727 120,282 151,711 Certificates of participation - net of unamortized discounts- - 31,138,965- Revenue bonds payable - net of deferred amount on refunding and unamortized premium9,421,11422,405,1944,249,29111,349,190 State revolving loans payable2,623,599 - - - Other postemployment benefits payabl493,202213,040 89,788106,113 e Total noncurrent liabilities12,768,44423,745,605 11,595,53740,731,499 Totaates14,687,18629,269,639 12,677,90942,121,746 llibilii î÷èûéé÷èé Invested in capital assets, net of related debt50,436,17448,283,39323,317,33715,060,301 50,530,631 16,455,381 1,860,716 Unrestricted22,353,418 Total net assets72,789,592$ 98,814,024$ 39,772,718$ 16,921,017$ Austment to reect te consoaton onterna servceun actvtes reate to enterprseuns djflhlidifilifdiiildifd et assets of business-type activities N The notes to the financial statements are an integral part of this statement. 24 XHIBIT 8 E îÍÎÏÛÒÍõÍÆ×ÊÎÏ×ÎÈÛ ÊÐ ÷ÎÈ×ÊÌÊÓÉ×ûÙÈÓÆÓÈÓ×É öÇÎØÉóÎÈ×ÊÎÛÐ ûËÇÛÈÓÙÉÛÎØé×ÊÆÓÙ× öÓÈÎ×ÉÉù×ÎÈ×ÊéÈÍÊÏÅÛÈ×ÊéÍÐÓØåÛÉÈ×èÍÈÛÐöÇÎØÉ $ 131,7822,362,594$ 721,363$ 80,906,895 $ $ 2,592,912 571,366195,5906,702,111- 109,288 - - 1,459,931- - - - -- 20,068 -11,544 - 4,137,898 - 703,1482,374,138 916,953 93,206,835 2,722,268 458,018- - 553,360 - -- - 569,994 - -- - 1,503,722 - -- - 6,243,530 - -- - 5,879,404 - 925,594 - 41,892,632- - 279,478 - 189,775,146 6,913,463 - 279,4787,839,057 - 231,667,778 - 737,4967,839,057 - 246,417,788 - 1,440,64410,213,195 916,953 339,624,623 2,722,268 59,7539,415427,4145,835,037 165,775 23,186- - 32,702 - 25,660266341,86629,130 - 126,616-387,345 1,011,560 - - - 608,452- - - - 2,347,486- - - - 827,077 - - 161,691499,414 427,680 11,004,180 165,775 -- - 569,994 - 111,304-- 5,072,224 - 14,34812,638131168,379 - 526,052452,248 2,057,713- - - - 31,138,965- - - - 47,424,789- - - - 2,623,599- - 76,726175,671 3,353 1,157,893 - 652,916716,071 3,484 90,213,556 - 814,6071,215,485 431,164 101,217,736 165,775 6,925,660158,632 144,181,497- - 467,405 485,789 94,225,390 2,556,493 2,072,050 $ 626,0378,997,710$ 485,789$ 238,406,887 $2,556,493 172,112 () $238,234,775 25 CITY OF MONROE, NORTH CAROLINA STATEMENT OF REVENUES, EXPENSES, AND CHANGES I N FUND NET ASSETS -- PROPRIETARY FUNDS For the Year Ended June 30, 2011 ïÛÒÍÊ÷ÎÈ×ÊÌÊÓÉ×öÇÎØÉ åÛÈ×Ê ÛÎØé×Å×Ê÷Ð×ÙÈÊÓÙîÛÈÇÊÛÐõÛÉûÓÊÌÍÊÈ íì÷êûèóîõê÷æ÷îç÷é Charges for services$ 12,593,269$ 48,161,410$ 17,010,623$ 1,617,841 Interfund charges and employee contributions - - - - Other operating revenues 292,376323,331 10,560 35,437 Total operating revenues12,916,600 48,453,786 17,021,183 1,653,278 íì÷êûèóîõ÷äì÷îé÷é Distribution systems4,372,3003,319,9712,422,940- Water filter plant2,404,585- - - Waste treatment plant2,702,772- - - Electric power purchases- 40,007,938- - Natural gas purchases - 8,510,245- - Aquatics and Fitness Center operations - - - - Airport operations - - 2,168,037- Stormwater operations - - - - Solidwaste operations - - - - Operating expenses204,53990,53343,59036,884 Health benefit claims and premiums - - - - Property and liability claims and premiums - - - - Depreciation and amortization 2,298,3031,910,137 972,609 642,121 Total operating expenses11,594,33345,716,745 2,847,04211,949,384 Ttlti1159433345716745119493842847042 Operating income (loss) 2,737,0411,322,267 5,071,799 (1,193,764) îíîíì÷êûèóîõê÷æ÷îç÷é÷äì÷îé÷é Gain (loss) on sale of capital assets- 190,511 - (130,348) Availability fees281,924- 298,525- Other nonoperating revenues13,324828,40016,036- Investment earnings86,211104,37365,50321,120 Interest and other charges(626,073) (1,105,441) (1,939,415) (732,268) Total nonoperating revenues (expenses)(244,614) 17,843 (1,559,351) (841,496) Income (loss) before capital grants and transfers1,077,6532,754,884 3,512,448(2,035,260) ùûìóèûðõêûîèé-- 2,150,000- èêûîéö÷êéèíöêíïíèô÷êöçîøé 2,615,435(574,127) (2,205,934) 2,820,844 Change in net assets503,526 5,370,319 1,306,514 2,935,584 Total net assets, beginning 72,286,066 93,443,705 38,466,204 13,985,433 98,814,024$ 39,772,718$ 16,921,017$ Total net assets, ending72,789,592$ Adjustment to reflect the consolidation of internal service fund activities related to enterprise funds Change in net assets of business-type activities The notes to the financial statements are an integral part of this statement. 26 XHIBIT 9 E îÍÎÏÛÒÍÊõÍÆ×ÊÎÏ×ÎÈÛÐ ÷ÎÈ×ÊÌÊÓÉ×ûÙÈÓÆÓÈÓ×É öÇÎØÉóÎÈ×ÊÎÛÐ ûËÇÛÈÓÙÉÛÎØé×ÊÆÓÙ× öÓÈÎ×ÉÉù×ÎÈ×ÊéÈÍÊÏÅÛÈ×ÊéÍÐÓØåÛÉÈ×èÍÈÛÐöÇÎØÉ $ 1,793,7443,787,318$ 2,822,596$ 87,786,801$ -$ - - - - 5,274,055 -139,863 - 801,567 197,564 1,793,7443,927,181 2,822,596 88,588,368 5,471,619 -- - 10,115,211 - -- - 2,404,585 - -- - 2,702,772 - -- - 40,007,938 - - - 8,510,245- - 3,119,934 - 3,119,934- - - - 2,168,037- - 1,593,015- 1,593,015- - - 2,693,5522,693,552- - 77,12133,5313,353 489,551 190,628 - - - - 5,161,938 - - - - 547,421 60,326268,950 - 6,152,446 - 1,686,8723,466,005 2,696,905 79,957,2865,899,987 346600516868722696905799572865899987 106,872461,176 125,691 8,631,082 (428,368) -- - 60,163 - -- - 580,449 - 5- - 857,765 - 7,7941,6872,288288,976 3,069 (8,986)(48,281) - (4,460,464) - (7,294)(40,487) 2,288 (2,673,111) 3,069 420,689 99,578 127,9795,957,971(425,299) - - 2,150,000- - (17,660)(19,426) - 2,619,132 800,000 81,918401,263 127,979 10,727,103 374,701 544,1198,596,447 357,810 2,181,792 626,037$ 485,789$ 2,556,493$ $8,997,710 (79,999) $10,647,104 27 CITY OF MONROE, NORTH CAROLINA STATEMENT OF CASH FLOWS PROPRIETARY FUND S For the Year Ended June 30, 2011 ïÛÒÍÊ÷ÎÈ×ÊÌÊÓÉ×öÇÎØÉ åÛÈ×Ê ÛÎØé×Å×Ê÷Ð×ÙÈÊÓÙîÛÈÇÊÛÐõÛÉûÓÊÌÍÊÈ ùûéôöðíåéöêíïíì÷êûèóîõûùèóæóèó÷é Cash received from customers12,463,880$ 47,438,171$ 17,039,214$ 1,223,810$ Cash paid for goods and services(5,776,221) (41,880,356) (10,939,263) (2,265,303) Cash paid to or on behalf of employees for services(3,676,440) (1,235,790) (546,747) (499,827) Customer deposits received 51,363 241,372 92,053 - Customer deposits returned(53,743) (239,487) (98,537) - Other operating revenues336,655 1,120,776 26,596 35,437 Net cash provided (used) by operating activities3,345,494 5,444,686 5,573,316 (1,505,883) ùûéôöðíåéöêíïîíîùûìóèûðöóîûîùóîõ ûùèóæóèó÷é Net advances (to) from other funds - 8,629,571 (1,060,272) (7,710,122) Transfers (to) from other funds(574,127)2,615,435(2,205,934) 2,820,844 et cash provided (used) by noncapital financing activiti(574,127) (3,266,206) (4,889,278) Ne ùûéôöðíåéöêíïùûìóèûðûîøê÷ðûè÷ø öóîûîùóîõûùèóæóèó÷é Proceeds from issuance of long-term debt5,010,874 2,150,868 934,410 12,496,591 Proceeds from sale of capital assets- 292,422 - - p, Acquisition and construction of capital assets (520,519) (5,715,085) (2,232,715) (2,934,092) Note receivable collected (granted) 648,940- 869,831 - Capital contributions - Federal Grants - - 2,150,000- Principal paid on bond maturities and equipment obligation(6,325,440) (3,174,232) (1,767,338) (12,721,796) Interest paid on bond maturities and equipment obligations(694,334) (1,136,110) (1,827,044)(763,818) Availability fees 281,924 298,525- - Bond issuance costs(86,444)(37,105)(16,120) (84,710) Net cash used by capital and related financing activities(2,333,939) (6,970,302) (3,740,451) (1,857,825) ùûéôöðíåéöêíïóîæ÷éèóîõûùèóæóèó÷é 104,373 65,503 21,120 Earnings on investments86,211 Net increase (decrease) in cash and cash equivalents523,639 9,823,763 (1,367,838) (8,231,866) 29,593,547 16,867,587 9,639,568 Balances, beginning21,508,092 39,417,310$ 15,499,749$ 1,407,702$ Balances, ending22,031,731$ îÍÎÙÛÉÔÓÎÆ×ÉÈÓÎÕÙÛÌÓÈÛÐÛÎØÖÓÎÛÎÙÓÎÕÛÙÈÓÆÓÈÓ×É The net book value of assets disposed in the Electric Fund amounted to $101,711. The net book value of assets disposed in the Airport Fund amounted to $130,348. The notes to the financial statements are an integral part of this statement. 28 XHIBIT 10, E Continued îÍÎÏÛÒÍÊõÍÆ×ÊÎÏ×ÎÈÛÐ ÷ÎÈ×ÊÌÊÓÉ×ûÙÈÓÆÓÈÓ×É öÇÎØÉóÎÈ×ÊÎÛÐ ûËÇÛÈÓÙÉÛÎØé×ÊÆÓÙ× öÓÈÎ×ÉÉù×ÎÈ×ÊéÈÍÊÏÅÛÈ×ÊéÍÐÓØåÛÉÈ×èÍÈÛÐöÇÎØÉ $ 3,787,318$ 1,333,638$ 2,826,657$ 86,112,688$ 5,274,281 (1,446,835) (1,050,125) (2,478,957) (65,837,060) (6,183,631) (1,640,232) (564,124) (6,689) (8,169,849) - - - - 384,788 - - - (391,767)- - 139,863 5 - 1,659,332 286,280 840,114 (280,606) 341,011 13,758,132 (623,070) (39,517)- - (180,340) - (19,426) (17,660) -2,619,132- (57,177) - 2,438,792 - (19,426) 458,000- - 21,050,743 - -- - 292,422 - , (5,224)(11,803) - (11,419,438) - - - 1,518,771- - - - 2,150,000- - (424,370) (33,340) (24,446,516)- - (48,281) (8,986) (4,478,573)- - - - - 580,449 - - - -(224,379)- (484,454) 410,450 - (14,976,521) - 1,687 2,287 288,975 3,069 7,794 74,354344,028 343,298 1,509,378 179,999 515,446 378,065 80,520,871 2,412,913 2,018,566 589,800$ 721,363$ 82,030,249$ 2,592,912$ $2,362,594 29 CITY OF MONROE, NORTH CAROLINA STATEMENT OF CASH FLOWS PROPRIETARY FUND S For the Year Ended June 30, 2011 ïÛÒÍÊ÷ÎÈ×ÊÌÊÓÉ×öÇÎØÉ åÛÈ×Ê ÛÎØé×Å×Ê÷Ð×ÙÈÊÓÙîÛÈÇÊÛÐõÛÉûÓÊÌÍÊÈ ê×ÙÍÎÙÓÐÓÛÈÓÍÎÍÖÍÌ×ÊÛÈÓÎÕÓÎÙÍÏ×ÈÍÎ×ÈÙÛÉÔÌÊÍÆÓØ×Ø ÚÃÍÌ×ÊÛÈÓÎÕÛÙÈÓÆÓÈÓ×É Operating income (loss)1,322,267$ 2,737,041$ 5,071,799$ (1,193,764)$ Adjustments to reconcile operating income to net cash provided by operating activities: Depreciation and amortization 1,910,137 2,298,303 972,609 642,121 Other revenues 13,324 828,400 16,036 - Changes in assets and liabilities: (Increase) decrease in accounts receivable (129,389) (723,239) 28,591 (394,031) (Increase) decrease in inventories (10,073) (14,107) (10,373) (409) (Increase) decrease in prepaid expenses 4,736 1,008 496 210 Increase (decrease) in accounts payable and accrued liabilities 33,336 227,469 (545,768) (596,228) Increase (decrease) in customer deposits (2,380) 1,885 (6,484) - Increase (decrease) in net OPEB liability 204,539 90,533 43,590 36,884 Increase (decrease) in compensated absences(1,003) (2,607) 2,820 (666) Total adjustments2,023,227 2,707,645 501,517 (312,119) Net cash provided (used) by operating activities$ 5,444,6863,345,494$ 5,573,316$ (1,505,883)$ The notes to the financial statements are an integral part of this statement. 30 XHIBIT 10 E îÍÎÏÛÒÍÊõÍÆ×ÊÎÏ×ÎÈÛÐ ÷ÎÈ×ÊÌÊÓÉ×ûÙÈÓÆÓÈÓ×É öÇÎØÉóÎÈ×ÊÎÛÐ ûËÇÛÈÓÙÉÛÎØé×ÊÆÓÙ× öÓÈÎ×ÉÉù×ÎÈ×ÊéÈÍÊÏÅÛÈ×ÊéÍÐÓØåÛÉÈ×èÍÈÛÐöÇÎØÉ $461,176 106,872$ 125,691$ 8,631,082$ (428,368)$ 60,326268,950 - 6,152,446 - -- - 857,760 - (460,106)- 4,061 (1,674,113) (990) -(3,655) - (38,617) - 373211 58 7,092 - (24,630)30,640 207,451 (667,730) (274,142) -- - (6,979) - 33,53177,121 3,353 489,551 - 3,0235,671 397 7,635 - (387,483)378,938 215,320 5,127,045 (194,702) $ (280,611)840,114$ 341,011$ 13,758,127$ (623,070)$ 31 CITY OF MONROE, NORTH CAROLINA NOTES TO THE FINANCIAL STATEMENTS June 30, 2011 I.éçïïûêãíöéóõîóöóùûîèûùùíçîèóîõìíðóùó÷é 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.ê×ÌÍÊÈÓÎÕ÷ÎÈÓÈà 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.úÛÉÓÉÍÖìÊ×É×ÎÈÛÈÓÍÎ õÍÆ×ÊÎÏ×ÎÈÅÓØ×éÈÛÈ×Ï×ÎÈÉ: 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. These statements distinguish between the ÕÍÆ×ÊÎÏ×ÎÈÛÐ and ÚÇÉÓÎ×ÉÉÈÃÌ×ÛÙÈÓÆÓÈÓ×É 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. öÇÎØöÓÎÛÎÙÓÛÐéÈÛÈ×Ï×ÎÈÉ The fund financial statements provide information about the City’s funds. Separate statements for each fund category – ÕÍÆ×ÊÎÏ×ÎÈÛÐÛÎØÌÊÍÌÊÓ×ÈÛÊà – are presented. The emphasis 32 of fund financial statements is on major governmental and enterprise funds, each displayed in a separate 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: õ×Î×ÊÛÐöÇÎØ. 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: åÛÈ×ÊÛÎØé×Å×ÊöÇÎØ 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. ÷Ð×ÙÈÊÓÙöÇÎØThis fund is used to account for the activities associated with the distribution and transmission of electricity by the City to its users. îÛÈÇÊÛÐõÛÉöÇÎØThis fund is used to account for the activities associated with the distribution of natural gas by the City to its users. ûÓÊÌÍÊÈöÇÎØ. This fund is used to account for the activities associated with the operation of the City’s Airport. ûËÇÛÈÓÙÉÛÎØöÓÈÎ×ÉÉù×ÎÈ×ÊöÇÎØThis fund is used to account for the activities associated with the operation of the City’s Aquatics and Fitness Center. C.ï×ÛÉÇÊ×Ï×ÎÈöÍÙÇÉÛÎØúÛÉÓÉÍÖûÙÙÍÇÎÈÓÎÕ In accordance with North Carolina General Statutes, all funds of the City are maintained during the year using the modified accrual basis of accounting. õÍÆ×ÊÎÏ×ÎÈÅÓØ×ÛÎØìÊÍÌÊÓ×ÈÛÊÃöÇÎØöÓÎÛÎÙÓÛÐéÈÛÈ×Ï×ÎÈÉThe 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 33 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 and internal service 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. õÍÆ×ÊÎÏ×ÎÈÛÐöÇÎØöÓÎÛÎÙÓÛÐéÈÛÈ×Ï×ÎÈÉ 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 these 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 2010 through February 2011 apply to the fiscal year ended June 30, 2011. 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.úÇØÕ×ÈÛÊÃøÛÈÛ 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 34 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. E.ûÉÉ×ÈÉðÓÛÚÓÐÓÈÓ×ÉÛÎØöÇÎØ÷ËÇÓÈà 1.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. 3.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, 2010. As allowed by State law, the City has established a 35 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. 5.Other Taxes and Licenses The City also levies a tax of five dollars per motor vehicle residing in the City of Monroe. The revenue relating to this is accounted for under “Other Taxes and Licenses” in the General Fund. Union County is responsible for billing and collecting this special vehicle tax in addition to the property taxes on registered motor vehicles residing in the City of Monroe. 6.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. 7.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. 8.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; computer software, $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: Estimated Asset Class 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 Computer Software 5 Other Equipment 5 - 15 Capital assets of the ABC Board are depreciated over their useful lives on a straight-line basis as follows: Estimated Useful Lives Asset Class Buildings 40 Furniture/Equipment 5 - 7 36 Vehicles5 The Tourism Development Authority had no capital assets at June 30, 2011. 9.Deferred/Unearned Revenues Governmental funds report deferred revenue in connection with receivables for revenues that are not 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. 10.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. 11.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: ÷ÏÌÐÍÃ××ÉÔÓÊ×ØÚ×ÖÍÊ×òÇÐà    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. ÷ÏÌÐÍÃ××ÉÔÓÊ×ØÛÖÈ×ÊòÇÐà    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, 2011 and falls under the City’s vacation policy. 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 37 in the next fiscal year has been designated as a current liability in the government-wide financial statements. The City’s, the ABC Board’s, and the Tourism Development Authority’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, the ABC Board, nor the Tourism Development Authority has any obligation for the accumulated sick leave until it is actually taken, no accrual for sick leave has been made. 12.Net Assets/Fund Balances î×ÈûÉÉ×ÈÉ 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. öÇÎØúÛÐÛÎÙ×É In the governmental fund financial statements, fund balance is composed of five classifications designed to disclose the hierarchy of constraints placed on how fund balance can be spent. The governmental fund types classify fund balances as follows: Nonspendable Fund Balance – This classification includes amounts that cannot be spent because they are either (a) not in spendable form or (b) legally or contractually required to be maintained intact. Inventories – Portion of fund balance that is not an available resource because it represents the year-end balance of ending inventories, which are not spendable resources. Restricted Fund Balance – This classification includes amounts that are restricted to specific purposes externally imposed by creditors or imposed by law. Restricted for Stabilization by State Statute – Portion of fund balance that is restricted by State Statute [G.S. 159-8(a)]. Restricted for Streets – Powell Bill portion of fund balance that is restricted by revenue source for street construction and maintenance expenditures. This amount represents the balance of the total unexpended Powell Bill funds. Classified Fund Balance – Portion of fund balance that can only be used for specific purposes by majority vote by quorum of the City of Monroe’s governing body (highest level of decision- making authority). Any changes or removal of specific purpose requires majority action by the governing body. Assigned Fund Balance – Portion of fund balance that the City of Monroe intends to use for specific purposes. Subsequent Year’s Expenditures – Portion of fund balance that is appropriated in the next year’s budget that is not already classified in restricted or committed. The governing body approves the appropriation; however the budget ordinance authorizes the manager to modify the appropriations by resource or appropriation within funds up to $100,000. Unassigned Fund Balance – The portion of fund balance that has not been restricted, committed, or assigned to specific purposes or other funds. 38 The City of Monroe has a revenue spending policy that provides guidance for programs with multiple revenue sources. The Finance Officer will use resources in the following hierarchy: bond proceeds, federal funds, state funds, local non-city funds, city funds. For purposes of fund balance classification expenditures are to be spent from restricted fund balance first, followed in-order by committed fund balance, assigned fund balance and lastly unassigned fund balance. The Finance Officer has the authority to deviate from this policy if it is in the best interest of the City. The City of Monroe has also adopted a minimum fund balance policy for the general fund which instructs management to conduct the business of the City in such a manner that available fund balance is at least equal to or greater than 25% of the next year’s budget, net of Federal and State pass-through revenues. Any portion of the general fund balance in excess of the 25% minimum requirement may be appropriated by City Council in a subsequent fiscal year to fund capital or debt service expenditures as determined by the City Council during the budget process. If during a fiscal year an excess over the stipulated 25% exists, the City Council may request an appropriation to fund unforeseen needs. 13.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. 14.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. II.ê÷ùíîùóðóûèóíîíöõíæ÷êîï÷îèåóø÷ûîøöçîøöóîûîùóûðéèûè÷ï÷îèé A.÷ÄÌÐÛÎÛÈÓÍÎÍÖÙ×ÊÈÛÓÎØÓÖÖ×Ê×ÎÙ×ÉÚ×ÈÅ××ÎÈÔ×ÕÍÆ×ÊÎÏ×ÎÈÛÐÖÇÎØÚÛÐÛÎÙ×ÉÔ××ÈÛÎØÈÔ× ÕÍÆ×ÊÎÏ×ÎÈÅÓØ×ÉÈÛÈ×Ï×ÎÈÍÖÎ×ÈÛÉÉ×ÈÉ The governmental fund balance sheet includes reconciliation between ÖÇÎØÚÛÐÛÎÙ×ÈÍÈÛÐÕÍÆ×ÊÎÏ×ÎÈÛÐ ÖÇÎØÉ and Î×ÈÛÉÉ×ÈÉÕÍÆ×ÊÎÏ×ÎÈÛÐÛÙÈÓÆÓÈÓ×É 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 $11,349,384 difference are as follows: Installment purchase obligations $ 6,736,340 Compensated absences 1,663,895 Net OPEB liability 2,694,766 Net adjustment to reduce ÖÇÎØÚÛÐÛÎÙ×ÈÍÈÛÐÕÍÆ×ÊÎÏ×ÎÈÛÐÖÇÎØÉ to arrive at Î×ÈÛÉÉ×ÈÉÕÍÆ×ÊÎÏ×ÎÈÛÐÛÙÈÓÆÓÈÓ×É$ 11,095,001 B.÷ÄÌÐÛÎÛÈÓÍÎÍÖÙ×ÊÈÛÓÎØÓÖÖ×Ê×ÎÙ×ÉÚ×ÈÅ××ÎÈÔ×ÕÍÆ×ÊÎÏ×ÎÈÛÐÖÇÎØÉÈÛÈ×Ï×ÎÈÍÖÊ×Æ×ÎÇ×É ×ÄÌ×ÎØÓÈÇÊ×ÉÛÎØÙÔÛÎÕ×ÉÓÎÖÇÎØÚÛÐÛÎÙ×ÉÛÎØÈÔ×ÕÍÆ×ÊÎÏ×ÎÈÅÓØ×ÉÈÛÈ×Ï×ÎÈÍÖÛÙÈÓÆÓÈÓ×É The government fund statement of revenues, expenditures, and changes in fund balances includes reconciliation between Î×ÈÙÔÛÎÕ×ÓÎÖÇÎØÚÛÐÛÎÙ×ÉÈÍÈÛÐÕÍÆ×ÊÎÏ×ÎÈÛÐÖÇÎØÉ and ÙÔÛÎÕ×ÓÎÎ×ÈÛÉÉ×ÈÉÍÖ ÕÍÆ×ÊÎÏ×ÎÈÛÐÛÙÈÓÆÓÈÓ×É 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 $(3,055,197) difference are as follows: 39 Capital outlay $ 1,090,527 Depreciation expense (4,146,064) Net adjustment to decrease Î×ÈÙÔÛÎÕ×ÓÎÖÇÎØÚÛÐÛÎÙ×ÉÈÍÈÛÐÕÍÆ×ÊÎÏ×ÎÈÛÐ ÖÇÎØÉ to arrive at ÙÔÛÎÕ×ÓÎÎ×ÈÛÉÉ×ÈÉÍÖÕÍÆ×ÊÎÏ×ÎÈÛÐÛÙÈÓÆÓÈÓ×É$ (3,055,197) 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 $1,473,118 are as follows: Debt issued or incurred: Installment purchase obligations $ (263,600) Principal payments: Installment purchase obligations 1,736,718 Net adjustment to increase Î×ÈÙÔÛÎÕ×ÓÎÖÇÎØÚÛÐÛÎÙ×ÉÈÍÈÛÐÕÍÆ×ÊÎÏ×ÎÈÛÐ ÖÇÎØÉto arrive at ÙÔÛÎÕ×ÓÎÎ×ÈÛÉÉ×ÈÉÍÖÕÍÆ×ÊÎÏ×ÎÈÛÐÛÙÈÓÆÓÈÓ×É$ 1,473,118 III.ø÷èûóðîíè÷éíîûððöçîøé A.ûÉÉ×ÈÉ 1. 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, 2011 the City's deposits had a carrying amount of $8,931,225 and a bank balance of $8,874,665. In addition, there was $553,360 in an escrow account with a trustee of unspent bond and installment financing proceeds. Of the bank balance, $500,000 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 $5,075. 40 At June 30, 2011 the ABC Board’s deposits had a carrying amount of $541,896 and a bank balance of $637,920. Of the bank balance, $250,000 was covered by federal depository insurance, and $387,920 was covered by collateral held under the Pooling Method. The ABC Board had an additional $3,900 in the drawers and petty cash to cover operating needs on a daily basis. At June 30, 2011, the Tourism Development Authority’s deposits had a carrying amount of $137,956 and a bank balance of $137,956. The entire balance was covered by federal depository insurance. 2. Investments As of June 30, 2011, the City had the following investments and maturities: 1 – 3 3 – 5 Investment Type Fair Value 1 Year YearsYears U.S. Government Agencies $86,861,045$-$- $86,861,045 NC Capital Management Trust – Cash Portfolio 8,451,197N/AN/AN/A NC Capital Management Trust – Term Portfolio 325,648325,648-- Total 95,637,890 $ óÎÈ×Ê×ÉÈêÛÈ×êÓÉÑ 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. ùÊ×ØÓÈêÓÉÑThe 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, 2011. 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. ùÇÉÈÍØÓÛÐùÊ×ØÓÈêÓÉÑ 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. ùÍÎÙ×ÎÈÊÛÈÓÍÎÍÖùÊ×ØÓÈêÓÉÑ 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 30% of the City’s total investments. In addition, the City had 9.2% of its investment portfolio in the NCCMT – cash portfolio at June 30, 2011. 3.NoteReceivable 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 $20,963. The note was paid in full during the fiscal year ended June 30, 2011. The City granted promissory notes to an electric customer to reimburse the cost and installation of equipment. The remaining balances of the promissory notes are payable in monthly installments. Due to the nature of the terms agreed upon the payment amounts will vary and are unpredictable. The monthly payment amounts are determined as follows: Each month electric charges will be calculated based on the LICPNC rate (LICPNC Bill) and 41 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 generator. 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. The first promissory note was granted during fiscal year 2007 for $1,730,070. At the current rate of payment it is estimated that the note will be repaid in full during fiscal year 2012. The agreement is non interest bearing and is secured by equipment. Principal collections on the note receivable for the fiscal year ended totaled $390,743. 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, 2011. 2011 Total receivable $ 311,768 Less current portion 311,768 Total Note Receivable – Noncurrent $ - Scheduled future maturities of the note receivable are as follows: 2012 $ 311,768 The second promissory note was granted during fiscal year 2010 for $2,300,000. At the current rate of payment it is estimated that the note will be repaid in full during fiscal year 2020. The agreement is interest bearing at a rate of 4.5% and is secured by equipment. Principal collections on the note receivable for the fiscal year ended totaled $237,234. 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, 2011. 2011 Total receivable $ 1,994,761 Less current portion 230,000 Total Note Receivable – Noncurrent $ 1,764,761 Scheduled future maturities of the note receivable are as follows: 2012$ 230,000 2013230,000 2014230,000 2015230,000 2016230,000 Thereafter844,761 $ 1,994,761 The City granted a promissory note in the amount of $6,000,000 to a natural gas supplier for capacity charges related to the leased capacity of a natural gas line. The remaining balance of the promissory note is payable in monthly installments of $97,363 through June 2016. The note calls for interest to be paid monthly at the annual rate of 5.42%. Principal collections for the fiscal year ended June 30, 2011 totaled $918,163. 2011 Total receivable $ 5,032,806 Less current portion 918,163 Total Note Receivable – Noncurrent $ 4,114,643 Scheduled future maturities of the note receivable are as follows: 42 2012$ 918,163 2013969,183 20141,023,039 20151,079,884 20161,042,537 $ 5,032,806 The City granted a promissory note in December 2010 in the amount of $1,250,000 to a developer as an incentive agreement to undertake an economic development project to renovate and rehabilitate a downtown historic structure. The note allows for no interest and is secured by property. No payments are required for the first three years. Beginning in December 2013, the promissory note will be repaid through monthly installments of $10,417 through November 2023. 2011 Total receivable $ 1,250,000 Less current portion - Total Note Receivable – Noncurrent $ 1,250,000 Scheduled future maturities of the note receivable are as follows: 2012$ - 2013- 201472,916 2015125,000 2016125,000 Thereafter927,084 $ 1,250,000 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 $ 16,773 5.CapitalAssets Primary Government Capital asset activity for the primary government for the year ended June 30, 2011, was as follows: Beginning Ending IncreasesDecreases Balances Balances õÍÆ×ÊÎÏ×ÎÈÛÐÛÙÈÓÆÓÈÓ×É õ×Î×ÊÛÐöÇÎØ ùÛÌÓÈÛÐÛÉÉ×ÈÉÎÍÈÚ×ÓÎÕØ×ÌÊ×ÙÓÛÈ×Ø Land and land improvements $4,596,793$83,700$-$4,680,493 Construction in progress 1,095,617337,5781,428,1035,092 Total capital assets not being depreciated 5,692,410 421,278 1,428,103 4,685,585 ùÛÌÓÈÛÐÛÉÉ×ÈÉÚ×ÓÎÕØ×ÌÊ×ÙÓÛÈ×Ø Buildings and improvements 19,631,1231,419,946-21,051,069 Equipment 4,066,875289,769-4,356,644 Vehicles and motorized equipment 13,335,134217,162166,77213,385,524 Other intangibles418,4108,079-426,489 Infrastructure 87,133,745 88,000-87,221,745 43 Beginning Ending BalancesIncreasesDecreasesBalances Total capital assets being depreciated 124,585,287 2,022,956 166,772 126,441,471 ð×ÉÉÛÙÙÇÏÇÐÛÈ×ØØ×ÌÊ×ÙÓÛÈÓÍÎÖÍÊ Buildings and improvements 7,063,022516,971-7,579,993 Equipment 2,602,856298,968-2,901,824 Vehicles and motorized equipment 9,359,7871,061,97825,67910,396,086 Other intangibles 73,71476,522-150,236 Infrastructure 29,843,969 2,122,833-31,966,802 Total accumulated depreciation 48,943,348$4,077,272 $ 25,679 52,994,941 Total capital assets being depreciated, net 75,641,939 73,446,530 õ×Î×ÊÛÐöÇÎØÙÛÌÓÈÛÐÛÉÉ×ÈÉÎ×È 81,334,349 78,132,115 øÍÅÎÈÍÅÎïÍÎÊÍ×öÇÎØ ùÛÌÓÈÛÐÛÉÉ×ÈÉÎÍÈÚ×ÓÎÕØ×ÌÊ×ÙÓÛÈ×Ø Land and land improvements 80,149--80,149 Total capital assets not being depreciated 80,149 - - 80,149 ùÛÌÓÈÛÐÛÉÉ×ÈÉÚ×ÓÎÕØ×ÌÊ×ÙÓÛÈ×Ø Equipment 98,071 - - 98,071 Total capital assets being depreciated 98,071 - - 98,071 ð×ÉÉÛÙÙÇÏÇÐÛÈ×ØØ×ÌÊ×ÙÓÛÈÓÍÎÖÍÊ Equipment 7,005 14,010 - 21,015 Total capital assets being depreciated, net 91,006 77,056 171,215 157,205 øÍÅÎÈÍÅÎïÍÎÊÍ×öÇÎØÙÛÌÓÈÛÐÛÉÉ×ÈÉÎ×È íÙÙÇÌÛÎÙÃèÛÄöÇÎØ ùÛÌÓÈÛÐÛÉÉ×ÈÉÚ×ÓÎÕØ×ÌÊ×ÙÓÛÈ×Ø Equipment - 150,000 - 150,000 Total capital assets being depreciated - 150,000 - 150,000 ð×ÉÉÛÙÙÇÏÇÐÛÈ×ØØ×ÌÊ×ÙÓÛÈÓÍÎÖÍÊ Equipment - 10,714 - 10,714 Total accumulated depreciation -$10,714 $ - 10,714 Total capital assets being depreciated, net - 139,286 - 139,286 íÙÙÇÌÛÎÙÃèÛÄöÇÎØÙÛÌÓÈÛÐÛÉÉ×ÈÉÎ×È $81,505,564$78,428,606 õÍÆ×ÊÎÏ×ÎÈÛÐÛÙÈÓÆÓÈÓ×ÉÙÛÌÓÈÛÐÛÉÉ×ÈÉÎ×È Depreciation expense was charged to functions/programs of the primary government as follows: General government $ 311,109 Transportation 2,389,053 Public safety 906,161 Culture and recreation 494,158 Economic and physical development 1,515 Total depreciation expense $4,101,996 44 Beginning Ending BalancesIncreasesDecreasesBalances úÇÉÓÎ×ÉÉÈÃÌ×ÛÙÈÓÆÓÈÓ×É åÛÈ×ÊÛÎØé×Å×ÊöÇÎØ ùÛÌÓÈÛÐÛÉÉ×ÈÉÎÍÈÚ×ÓÎÕØ×ÌÊ×ÙÓÛÈ×Ø $ 829,827 $ - Land and land improvements $ - $829,827 1,138,848 576,552 1,250,467464,933 Construction in progress Total capital assets not being depreciated 1,968,675 576,552 1,250,467 1,294,760 ùÛÌÓÈÛÐÛÉÉ×ÈÉÚ×ÓÎÕØ×ÌÊ×ÙÓÛÈ×Ø Buildings and improvements 22,879,384--22,879,384 2,751,930703,129-3,455,059 Equipment Vehicles and motorized equipment 2,877,019138,84639,2332,976,632 Infrastructure60,181,425493,321-60,674,746 88,689,758 Total capital assets being depreciated 1,335,296 39,233 89,985,821 ð×ÉÉÛÙÙÇÏÇÐÛÈ×ØØ×ÌÊ×ÙÓÛÈÓÍÎÖÍÊ Buildings and improvements 9,888,812479,731-10,368,543 Equipment 1,638,530227,436-1,865,966 Vehicles and motorized equipment 2,316,642272,23536,5252,552,352 Infrastructure 11,475,4661,064,820-12,540,286 Total accumulated depreciation 25,319,450 2,044,222 36,525 27,327,147 Total capital assets being depreciated, net 63,370,30862,658,674 åÛÈ×ÊÛÎØé×Å×ÊöÇÎØÙÛÌÓÈÛÐÛÉÉ×ÈÉÎ×È65,338,98363,953,434 ÷Ð×ÙÈÊÓÙöÇÎØ ùÛÌÓÈÛÐÛÉÉ×ÈÉÎÍÈÚ×ÓÎÕØ×ÌÊ×ÙÓÛÈ×Ø 4,520,094-101,7114,418,383 Land and land improvements Construction in progress 21,286,0393,567,22311,139,64313,713,619 Total capital assets not being depreciated 25,806,133 3,567,223 11,241,354 18,132,002 ùÛÌÓÈÛÐÛÉÉ×ÈÉÚ×ÓÎÕØ×ÌÊ×ÙÓÛÈ×Ø Buildings and improvements 703,349--703,349 Equipment 4,515,395--4,515,395 Vehicles and motorized equipment 2,552,773340,746133,1452,760,374 Infrastructure63,318,57812,946,557-76,265,135 Total capital assets being depreciated 71,090,095 13,287,303 133,145 84,244,253 ð×ÉÉÛÙÙÇÏÇÐÛÈ×ØØ×ÌÊ×ÙÓÛÈÓÍÎÖÍÊ Buildings and improvements 75,26215,536-90,798 Equipment 2,367,432400,64281,9282,686,146 Vehicles and motorized equipment 1,519,764266,381133,1451,653,000 Infrastructure23,799,7451,680,364-25,480,109 Total accumulated depreciation 27,762,203 2,362,923 215,073 29,910,053 Total capital assets being depreciated, net 43,327,892 54,334,200 69,134,025 72,466,202 ÷Ð×ÙÈÊÓÙöÇÎØÙÛÌÓÈÛÐÛÉÉ×ÈÉÎ×È îÛÈÇÊÛÐõÛÉöÇÎØ ùÛÌÓÈÛÐÛÉÉ×ÈÉÎÍÈÚ×ÓÎÕØ×ÌÊ×ÙÓÛÈ×Ø Land and land improvements 780,785--780,785 Construction in progress 43,930,9981,661,426 41,387,5144,204,910 Total capital assets not being depreciated 44,711,7831,661,42641,387,514 4,985,695 45 Beginning Ending BalancesIncreasesDecreasesBalances ùÛÌÓÈÛÐÛÉÉ×ÈÉÚ×ÓÎÕØ×ÌÊ×ÙÓÛÈ×Ø Buildings and improvements 569,484--569,484 Equipment 647,34568,404-715,749 Vehicles and motorized equipment 662,736108,873-771,609 Infrastructure 16,737,93241,781,524-58,519,456 Total capital assets being depreciated 18,617,497 41,958,801 - 60,576,298 ð×ÉÉÛÙÙÇÏÇÐÛÈ×ØØ×ÌÊ×ÙÓÛÈÓÍÎÖÍÊ Buildings and improvements 126,87013,256-140,126 Equipment 185,31977,646-262,965 Vehicles and motorized equipment 413,73450,715-464,449 Infrastructure4,225,232805,138-5,030,370 Total accumulated depreciation 4,951,155 946,755 - 5,897,910 Total capital assets being depreciated, net 13,666,342 54,678,388 58,378,125 59,664,083 îÛÈÇÊÛÐõÛÉöÇÎØÙÛÌÓÈÛÐÛÉÉ×ÈÉÎ×È ûÓÊÌÍÊÈöÇÎØ ùÛÌÓÈÛÐÛÉÉ×ÈÉÎÍÈÚ×ÓÎÕØ×ÌÊ×ÙÓÛÈ×Ø Land and land improvements 8,337,466 1,072,681-9,410,147 Construction in progress 8,436,2902,780,1654,072,0217,144,434 Total capital assets not being depreciated 16,773,756 3,852,846 4,072,021 16,554,581 ùÛÌÓÈÛÐÛÉÉ×ÈÉÚ×ÓÎÕØ×ÌÊ×ÙÓÛÈ×Ø Buildings and improvements 14,096,12834,145-14,130,273 Equipment 456,339--456,339 Vehicles and motorized equipment 410,60175,88427,340459,145 Infrastructure 153,4002,939,187-3,092,587 Total capital assets being depreciated 15,116,468 3,049,216 27,340 18,138,344 ð×ÉÉÛÙÙÇÏÇÐÛÈ×ØØ×ÌÊ×ÙÓÛÈÓÍÎÖÍÊ Buildings and improvements 6,240,421491,150-6,731,571 Equipment 190,18055,209-245,389 Vehicles and motorized equipment 157,23977,70818,500216,447 Infrastructure 1,53432,460-33,994 Total accumulated depreciation 6,589,374 656,527 18,500 7,227,401 Total capital assets being depreciated, net 8,527,09410,910,943 ûÓÊÌÍÊÈöÇÎØÙÛÌÓÈÛÐÛÉÉ×ÈÉÎ×È25,300,85027,465,524 ûËÇÛÈÓÙÉÛÎØöÓÈÎ×ÉÉù×ÎÈ×ÊöÇÎØ ùÛÌÓÈÛÐÛÉÉ×ÈÉÎÍÈÚ×ÓÎÕØ×ÌÊ×ÙÓÛÈ×Ø Land and land improvements 925,594--925,594 Total capital assets not being depreciated 925,594- - 925,594 ùÛÌÓÈÛÐÛÉÉ×ÈÉÚ×ÓÎÕØ×ÌÊ×ÙÓÛÈ×Ø Buildings and improvements 9,431,009--9,431,009 Equipment 111,467--111,467 29,817 Vehicles and motorized equipment 12,280-42,097 Total capital assets being depreciated 9,554,756 29,817 - 9,584,573 46 Beginning Ending BalancesIncreasesDecreasesBalances ð×ÉÉÛÙÙÇÏÇÐÛÈ×ØØ×ÌÊ×ÙÓÛÈÓÍÎÖÍÊ Buildings and improvements 2,334,651254,383-2,589,034 Equipment 39,95710,842-50,799 Vehicles and motorized equipment 9,53921,738-31,277 Total accumulated depreciation 2,384,147 286,963 - 2,671,110 Total capital assets being depreciated, net 7,170,609 6,913,463 ûËÇÛÈÓÙÉÛÎØöÓÈÎ×ÉÉöÇÎØÙÛÌÓÈÛÐ ÛÉÉ×ÈÉÎ×È 8,096,203 7,839,057 éÈÍÊÏÅÛÈ×ÊöÇÎØ ùÛÌÓÈÛÐÛÉÉ×ÈÉÚ×ÓÎÕØ×ÌÊ×ÙÓÛÈ×Ø Equipment 20,724 5,224 - 25,948 Vehicles and motorized equipment 669,779 - - 669,779 Total capital assets being depreciated 690,503 5,224 - 695,727 ð×ÉÉÛÙÙÇÏÇÐÛÈ×ØØ×ÌÊ×ÙÓÛÈÓÍÎÖÍÊ Equipment 2,2753,334-5,609 Vehicles and motorized equipment 353,648 56,992 - 410,640 Total accumulated depreciation 355,923 $60,326 $ - 416,249 Total capital assets being depreciated, net 334,580 279,478 334,580 279,478 éÈÍÊÏÅÛÈ×ÊöÇÎØÙÛÌÓÈÛÐÛÉÉ×ÈÉÎ×È $226,582,766 $231,667,778 úÇÉÓÎ×ÉÉÈÃÌ×ÛÙÈÓÆÓÈÓ×ÉÙÛÌÓÈÛÐÛÉÉ×ÈÉÎ×È ùÍÎÉÈÊÇÙÈÓÍÎÙÍÏÏÓÈÏ×ÎÈÉ The government has active construction projects as of June 30, 2011. At year end, the government's commitments with contractors are as follows: Spent-to- Remaining ProjectsDateCommitment Governmental Capital Projects $5,092 $- Enterprise Water and Sewer 464,933 181,230 Electric 13,713,619 2,989,877 Natural Gas 4,204,911 1,549,203 Airport 7,144,434 1,099,565 Total $ 25,532,989$5,819,875 Discretely presented component units Capital asset activity for the ABC Board for the year ended June 30, 2011, was as follows: 47 Beginning Ending BalancesIncreasesDecreases Balances ùÛÌÓÈÛÐÛÉÉ×ÈÉÎÍÈÚ×ÓÎÕØ×ÌÊ×ÙÓÛÈ×Ø Land and land improvements $317,013$ - $ - $317,013 ùÛÌÓÈÛÐÛÉÉ×ÈÉÚ×ÓÎÕØ×ÌÊ×ÙÓÛÈ×Ø Buildings and improvements 1,037,379- - 1,037,379 Equipment 117,13235,02931,194120,967 Vehicles and motorized equipment 15,830 - - 15,830 Total capital assets being depreciated 1,170,341 35,029 31,194 1,174,176 ð×ÉÉÛÙÙÇÏÇÐÛÈ×ØØ×ÌÊ×ÙÓÛÈÓÍÎÖÍÊ Buildings and improvements 306,78928,371 - 335,160 103,1327,093 Equipment 31,19479,031 Vehicles and motorized equipment 15,830- - 15,830 Total accumulated depreciation 425,751 $35,464 $ 31,194 430,021 Total capital assets being depreciated, net 744,590 744,155 ûúùúÍÛÊØ $$ ÙÛÌÓÈÛÐÛÉÉ×ÈÉÎ×È1,061,6031,061,168 The Tourism Development Authority had no capital assets. B.ðÓÛÚÓÐÓÈÓ×É 1.Accounts Payable and Accrued Liabilities Payables at the government-wide level at June 30, 2011, were as follows: Salaries and VendorsBenefits OtherTotal Governmental activities: General Fund $613,667 $- $ - $613,667 Nonmajor Funds 50,718 - - 50,718 Total-governmental activities $664,385 $- $ - $664,385 Business-type activities: Enterprise Funds $5,835,037 $- $ - $5,835,037 Component units’ payables at June 30, 2011, were as follows: Salaries and VendorsBenefits OtherTotal ABC Board $287,719 $255 $ 32,500 $320,474 Tourism Development Authority $2,356 $- $ 664 $3,020 2.Pension Plan Obligations a.ðÍÙÛÐõÍÆ×ÊÎÏ×ÎÈÛÐ÷ÏÌÐÍÃ××Éê×ÈÓÊ×Ï×ÎÈéÃÉÈ×Ï ìÐÛÎø×ÉÙÊÓÌÈÓÍÎ 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 48 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. öÇÎØÓÎÕìÍÐÓÙà 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 6.44% and 6.41%, respectively, of annual covered payroll. For the ABC Board, the current rate for employees not engaged in law enforcement is 6.50% 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, 2011, 2010, and 2009, were $1,068,767, $1,084,527, and $1,058,105, respectively. The ABC Board’s contributions to LGERS for the years ended June 30, 2011, 2010, and 2009 were $15,340, $14,210, and $13,394, respectively. The contributions made by the City and the ABC Board equaled the required contributions for each year. b. ðÛÅ÷ÎÖÍÊÙ×Ï×ÎÈíÖÖÓÙ×ÊÉéÌ×ÙÓÛÐé×ÌÛÊÛÈÓÍÎûÐÐÍÅÛÎÙ× ìÐÛÎø×ÉÙÊÓÌÈÓÍÎ 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 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, 2009, the Separation Allowance’s membership consisted of: Retirees receiving benefits 11 Terminated plan members entitled to but not yet receiving benefits - Active plan members 85 Total 96 A separate report was not issued for the plan. éÇÏÏÛÊÃÍÖéÓÕÎÓÖÓÙÛÎÈûÙÙÍÇÎÈÓÎÕìÍÐÓÙÓ×É úÛÉÓÉÍÖûÙÙÍÇÎÈÓÎÕ 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. ï×ÈÔÍØçÉ×ØÈÍæÛÐÇ×óÎÆ×ÉÈÏ×ÎÈÉ No funds are set aside to pay benefits and administration costs. These expenditures are paid as they come due. ùÍÎÈÊÓÚÇÈÓÍÎÉ 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, 2009 actuarial valuation using the projected unit credit actuarial cost method. The actuarial assumptions included (a) 49 5.00% 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, 2009 was 21 years. ûÎÎÇÛÐì×ÎÉÓÍÎùÍÉÈÛÎØî×Èì×ÎÉÓÍÎíÚÐÓÕÛÈÓÍÎThe City’s annual pension cost and net pension obligation (prepayment) to the Separation Allowance for the current year were as follows: Annual required contribution $ 225,936 Interest on net pension obligation (6,467) Adjustment to annual required contribution 6,924 Annual pension cost 226,393 Contributions made 166,395 Decrease in net pension obligation 59,998 Net pension obligation, beginning of year (129,330) Net prepaid pension obligation, end of year $ (69,332) 3 Year Trend Information For Year Annual Pension Percentage of Net Pension Ended Cost APC Obligation June 30 (APC)Contributed (Prepayment) 2009 $ 163,225 101.71% $(132,123) 2010 173,111 98.39% (129,330) 2011 226,393 73.50% (69,332) öÇÎØ×ØéÈÛÈÇÉÛÎØöÇÎØÓÎÕìÊÍÕÊ×ÉÉ As of December 31, 2010, 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 $1,852,860. The covered payroll (annual payroll of active employees covered by the plan) was $4,406,310, and the ratio of the UAAL to the covered payroll was 42.05%. The schedule of funding progress, presented as required supplementary information following the notes to the financial statements, presents multiyear trend information about whether the actuarial value of plan assets are increasing or decreasing over time relative to the actuarial accrued liability for benefits. c.éÇÌÌÐ×Ï×ÎÈÛÐê×ÈÓÊ×Ï×ÎÈóÎÙÍÏ×ìÐÛÎ ðÛÅ÷ÎÖÍÊÙ×Ï×ÎÈíÖÖÓÙ×ÊÉ ìÐÛÎø×ÉÙÊÓÌÈÓÍÎ 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. öÇÎØÓÎÕìÍÐÓÙÃArticle 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, 2011, were $295,686 which consisted of $220,177 from the City and $75,509 from the law enforcement officers. õ×Î×ÊÛÐ÷ÏÌÐÍÃ××É 50 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, 2011, were $1,276,216, which consisted of $848,590 from the City and $427,626 from the employees. d.öÓÊ×Ï×ΪÉÛÎØê×ÉÙÇ×éËÇÛØåÍÊÑ×Êɪì×ÎÉÓÍÎöÇÎØ ìÐÛÎø×ÉÙÊÓÌÈÓÍÎ. 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. öÇÎØÓÎÕìÍÐÓÙà 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. íÎú×ÔÛÐÖìÛÃÏ×ÎÈÉ. For the fiscal year ended June 30, 2011, the City of Monroe has recognized on- behalf payments for pension contributions made by the state as a revenue and an expenditure of $16,383 for the 49 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. e.íÈÔ×ÊìÍÉÈ×ÏÌÐÍÃÏ×ÎÈú×Î×ÖÓÈÉ Healthcare Benefits ìÐÛÎø×ÉÙÊÓÌÈÓÍÎ Under the terms of a City resolution, the City administers a single employer Health and Dental Care Plan. This plan provides postemployment healthcare and dental benefits to retirees of the City provided they participate in the North Carolina Local Government Employees’ Retirement System and have twenty (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. The City pays the full cost of coverage for these benefits through private insurers. A stand-alone financial report is not issued. öÇÎØÓÎÕìÍÐÓÙà Employees with 20 to 25 years of service – the City pays 50% and 75% of the cost of health and dental insurance, respectively. Employees 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. 51 Membership of the Health Care Plan consisted of the following at December 31, 2010: All Employees Retirees and dependents receiving benefits 71 Terminated plan members entitled to but not yet receiving benefits - Active plan members 485 Total 556 The current ARC rate is 6.89% of annual covered payroll. For the current year, the City contributed $254,399 or 1.16% of annual covered payroll. For the year ended June 30, 2011, the City made payments for postretirement health benefit premiums of $343,165. The City’s obligation to contribute to Health Care Plan is established and may be amended by the City Council. éÇÏÏÛÊÃÍÖéÓÕÎÓÖÓÙÛÎÈûÙÙÍÇÎÈÓÎÕìÍÐÓÙÓ×É Postemployment expenditures are made from the Health and Dental Self-Insurance Fund. No funds are set aside to pay benefits and administration costs. These expenditures are paid as they come due. ûÎÎÇÛÐíì÷úùÍÉÈÛÎØî×Èíì÷úíÚÐÓÕÛÈÓÍÎ The City’s annual OPEB cost (expense) is calculated on the ÛÎÎÇÛÐÊ×ËÇÓÊ×ØÙÍÎÈÊÓÚÇÈÓÍÎÍÖÈÔ××ÏÌÐÍÃ×Ê (ARC), an amount actuarially determined in accordance with the parameters of GASB Statement 45. The ARC represents a level of funding that, if paid on an ongoing basis is projected to cover normal cost each year and amortize any unfunded actuarial liabilities (or funding excess) over a period not to exceed thirty years. The following table shows the components of the City’s annual OPEB cost for the year, the amount actually contributed to the plan, and changes in the City’s net OPEB obligation for the healthcare benefits: Annual required contribution $1,833,000 Interest on net obligation 90,800 Adjustment to annual required contribution (86,742) Annual OPEB cost (expense) 1,837,058 Contributions made (254,399) Increase (decrease) in net OPEB obligation 1,582,659 Net OPEB obligation, beginning of year 2,270,000 Net OPEB obligation, end of year $3,852,659 The City’s annual OPEB costs, the percentage of annual OPEB cost contributed to the plan, and the net OPEB obligation for 2011 were as follows: For Year Annual Percentage of Annual Net OPEB Ended June 30 OPEB Cost OPEB Cost Contributed Obligation 2010 $ 1,513,00026.2%$ 2,270,000 20111,837,05813.8%3,852,659 öÇÎØ×ØéÈÛÈÇÉÛÎØöÇÎØÓÎÕìÊÍÕÊ×ÉÉ As of December 31, 2010, the most recent actuarial valuation date, the plan was not funded. The actuarial accrued liability for benefits, and, thus the unfunded actuarial accrued liability (UAAL) was $20,670,010. The covered payroll (annual payroll of active employees covered by the plan) was $21,957,134, and the 52 ratio of the UAAL to the covered payroll was 94.1%. Actuarial valuations of an ongoing plan involve estimates of the value of reported amounts and assumptions about the probability of occurrence of events far into the future. Examples include factors such as changes in economic or demographic assumptions, increases or decreases expected as part of the natural operation of the methodology used for these measurements (such as the end of an amortization period or additional cost or contribution requirements based on the plan’s funded status) and changes in the plan provisions or applicable law. Amounts determined regarding the funded status of the plan and the annual required contributions of the employer are subject to continual revision as actual results are compared with past experiences and new estimates are made about the future. The schedule of funding progress, presented as required supplementary information following the notes to the financial statements, presents multiyear trend information about whether the actuarial value of plan assets is increasing or decreasing over time relative to the actuarial accrued liabilities for benefits. ûÙÈÇÛÊÓÛÐï×ÈÔÍØÉÛÎØûÉÉÇÏÌÈÓÍÎÉ Projections of benefits for financial reporting purposes are based on the substantive plan (the plan as understood by the employer and the plan members) and included the types of benefits provided at the time of each valuation and the historical pattern of sharing of benefit costs between the employer and plan members at that point. The actuarial methods and assumptions used include techniques that are designed to reduce the effects of short-term volatility in actuarial accrued liabilities and the actuarial value assets, consistent with the long-term perspective of the calculations. In the December 31, 2010 actuarial valuation, the projected until credit cost method was used. The actuarial assumptions included a 4.00 percent investment rate of return, which is the expected long-term investment returns on the employer’s own investments calculated based on the funded level of the plan at the valuation date, and an annual medical cost trend increase of 10.50 to 5.00 percent annually. Both rates included a 3.00 percent inflation assumption. The actuarial value of assets, if any, was determined using market value of investments. The UAAL is being amortized as a level percentage of projected payroll on an open basis. The remaining amortization period at December 31, 2010 was 30 years. 3.OtherEmploymentBenefits 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, 2011, the City made contributions to the State for death benefits of $21,702. 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 53 government-wide statements at year end is composed of the following elements: Deferred Unearned Revenue Revenue Property taxes receivable: General $ 1,179,608 $ - Nonmajor governmental 2,744 - Occupancy tax receivable 29,627- Privilege license receivable: General 21,683 - Loans receivable: Nonmajor governmental 16,773 - Special vehicle tax receivable: General 26,615 - Code enforcement liens receivable: General 94,963 - Prepaid taxes and licenses: General - 592,730 Total $ 1,372,013 $ 592,730 5.RiskManagement 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 The City has established three Internal Service Funds to account for self-insured risk financing. Funding of the Health Benefit Fund is based upon an analysis of historical and projected medical and dental claims paid by the third party administrator and the availability of unrestricted net assets to fund projected claims. Funding of the Workers’ Compensation Fund is based upon payroll rates established by the State of North Carolina and the availability of unrestricted net assets to fund projected claims. Funding of the Property and Casualty Fund is based upon 54 experience and exposure risks associated with County operations and the availability of unrestricted net assets to fund projected claims. õÊÍÇÌô×ÛÐÈÔóÎÉÇÊÛÎÙ× Effective July 1, 2002, the City established an employee medical benefit plan to self-insure claims up to $70,000 per year for each individual covered; claims above $70,000 and aggregate claims exceeding 125% of expected incurred and paid claims are covered by a stop loss insurance policy. åÍÊÑ×ÊɪùÍÏÌ×ÎÉÛÈÓÍÎóÎÉÇÊÛÎÙ× 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 $400,000 retained risk per occurrence for firefighters, police officers, and electrical line workers. All other employees have 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. Due to the degree of turnover of the outstanding claims, the claims payable as of June 30, 2011 are considered to be current liabilities. Changes in the balance of claims liabilities during the year ended June 30, 2011 are as follows: Health Benefit Workers’ Property & FundCompensation Fund Casualty Fund Unpaid claims as of June 30, 2009 475,548 15,646 57,747 Claims and premiums paid $ 5,584,603 $ 179,418 $ 522,008 Incurred claims and premiums (5,640,166) (181,583) (573,304) Unpaid claims as of June 30, 2010 419,985 13,481 6,451 Claims and premiums paid 5,324,419 165,937 521,531 Incurred claims and premiums (5,584,603) (179,418) (522,008) Unpaid claims as of June 30, 2011 $ 159,801 $ - $ 5,974 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 deputy tax collector is individually bonded for $50,000. 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, 2011. 55 Claims,Judgements,andContingentLiabilities The City was a defendant in various matters of litigation as of June 30, 2011. While any litigation contains an element of uncertainty, City officials believe that the outcome of any lawsuit or claim which is pending, or all of them combined, will not have a materially adverse effect on the City’s financial condition or operations. In addition, there are known incidents that may result in the assertion of claims, as well as claims from unknown incidents that may be asserted for which the City could be liable for a material amount. However, since such claims have not been asserted and are not determinable or measurable, no provision for loss has been included in the financial statements. Also, City officials believe the City’s insurance is adequate for the actual or pending lawsuits or claims mentioned above. 7.Long-TermObligations a.óÎÉÈÛÐÐÏ×ÎÈìÇÊÙÔÛÉ×íÚÐÓÕÛÈÓÍÎÉ The City has entered into various installment purchase obligations to acquire certain equipment and to finance building improvements: GovernmentalEnterprise FundsFundsTotal 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%. $-$52,993$52,993 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%. 514,000 - 514,000 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%.-860,405860,405 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%. 587,067 -587,067 Executed June 15, 2007, to finance equipment, requiring 10 semi-annual installments of $132,518 including interest at 3.8333%. 203,827 54,182258,009 Executed February 8, 2008, to finance facility improvements, requiring 20 semi-annual installments of $95,000 plus interest at 3.827%. 1,330,000-1,330,000 Executed June 20, 2008, to finance equipment, requiring 10 semi-annual installments of $216,651 including interest at 3.19%. 600,245 233,429833,673 Executed June 15, 2009 to finance equipment, 10 semi-annual installments of $201,937 including interest at 2.8378%. 780,921372,7371,153,658 56 Executed January 30, 2009 to finance construction of a recreation center, requiring 30 semi-annual installments of $79,724 plus interest at 4.570%. 2,072,824 - 2,072,824 Executed June 11, 2010, to finance equipment, requiring 10 semi-annual installments of $181,609 including interest at 2.585%. 383,894 987,9891,371,883 Executed June 24, 2011, to finance equipment, requiring 10 semi-annual installments of $82,034 including interest at 2.29%. 263,562507,538771,100 $ 6,736,340 $3,069,273 $ 9,805,613 Annual debt service payments of the installment purchase obligations as of June 30, 2011, are as follows: Governmental Activities Business-Type Activities Year Ending June 30 Principal Interest Principal Interest 2012$ 1,460,000 $235,339 $1,011,567 $ 83,954 20131,276,878187,724933,10952,573 2014982,886148,383657,99924,213 2015645,523117,574 360,3749,205 2016473,69696,071106,2241,727 2017-20211,418,973246,480-- 2022-2025478,38438,256-- Total $ 6,736,340 $3,069,273 Total interest payments $1,069,827 $ 171,672 At June 30, 2011, the City had a legal debt margin of $235,387,906. .ê×Æ×ÎÇ×úÍÎØÉ b 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: Serviced by the Water and Sewer Fund, Electric Fund, Airport Fund and Natural Gas Fund: $30,920,000 Combined Enterprise System Revenue Bonds, Series 2008A, due annually in amounts ranging from $795,000 to $2,055,000 through March 1, 2033, interest rate varying between 4.0% and 5.0%. The amount shown includes $307,492 in unamoritized bond premiums $ associated with the bonds. 29,667,489 $19,620,000 Combined Enterprise System Revenue Bonds, Series 2011, due annually in amounts ranging from $945,000 to $1,460,000 through March 1, 2028, interest rate varying between 2.0% and 5.0%. The amount shown includes $1,048,939 in unamortized bond premiums and $564,153 of unamortized deferred loss on defeasance associated with the bonds. 20,104,786 $49,772,275 57 The future payments of the revenue bonds for the years ending June 30, are as follows: Business-Type Activities Year Ending June 30 Principal Interest 2012$ 2,285,000 $ 1,848,574 2013 2,090,000 2,043,319 2014 2,175,000 1,959,719 2015 2,265,000 1,872,719 2016 2,355,000 1,782,119 2017 – 2021 11,975,000 7,326,746 2022 – 2026 11,405,000 4,891,103 2027 – 2031 10,415,000 2,328,601 2032 – 2033 4,015,000 288,150 Total $48,980,000 $24,341,051 The future payments as presented above, have not been reduced by $564,153, the unamortized deferred loss incurred as a result of the advance refundings and the $1,356,431 in unamoritized bond premiums. 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% parity indebtedness and 100% of the long term debt service requirement for subordinated indebtedness for the fiscal year. The debt service coverage ratio calculation for the year ended June 30, 2011, is as follows: Operating revenues $80,044,847 Operating expenses (1) 66,284,334 Operating income 13,760,513 Nonoperating revenues (2) 277,207 Income available for debt service 14,037,720 Parity debt service (3) 5,233,017 Debt service coverage ratio 268% Income available for debt service 14,037,720 Subordinated debt service (3) 8,086,056 Debt service coverage ratio 174% (1) Per rate covenants, this does not include the depreciation expense of $5,823,170. (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 $50.5 million in revenue bonds issued in 2008 and 2011. Proceeds from the bonds provided financing for various capital projects and refunded prior issues. 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 $73,321,043. Principal and interest paid for the current year and total customer net revenues were $4,260,085 and $79.4 million, respectively. 58 c.ûØÆÛÎÙ×ê×ÖÇÎØÓÎÕÉ On June 30, 2011, the City issued $19,620,000 in Combined Enterprise System Revenue Refunding Bonds with interest rates ranging from 2.0% to 5.0% and retired Series 1998 and Series 2008B Combined Enterprise System Revenue Bonds. As a result, the refunded bonds are considered to be defeased and the liabilities have been removed from the financial statements. The advance refundings resulted in a difference between the reacquisition price and the net carrying amount of the old debt of $564,153. This difference is reported in the accompanying financial statements as a deduction from bonds payable and is being charged to operations through the year 2028 using the effective interest method over the life of the new debt which is the same as 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 17 years by $1,618,744 and to obtain an economic gain (difference between the present values of the old and new debt service payments) of $1,289,799. ØéÈÛÈ×ê×ÆÍÐÆÓÎÕðÍÛÎÉ 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%. $ 1,476,553 Loan payable to the State of North Carolina Water Pollution Control Revolving Loan Fund with a maximum limit of $3,735,210 payable over 20 years with interest at 2.89%.560,282 Loan payable to the State of North Carolina Water Bond Loan Fund with a maximum limit of $1,515,662 payable over 20 years with interest at 5.85%. 378,915 Loan payable to the State of North Carolina Water Bond Loan Fund with a maximum limit of $1,484,338 payable over 20 years with a revised interest rate of 3.43% effective May 1, 2003 (previous rate was 5.30%). 371,084 Loan payable to the State of North Carolina Water Pollution Control Revolving Loan Fund with a maximum limit of $1,159,030 payable over 20 years with interest at 3.035%.347,709 Loan payable to the State of North Carolina Water Pollution Control Revolving Loan Fund with a maximum limit of $1,270,105 payable over 20 years with interest at 2.89%.316,134 $ 3,450,676 59 Annual debt service requirements to maturity for the State Revolving Loans are as follows: Business-Type Activities Year Ending June 30 Principal Interest 2012 $827,077 $117,508 2013827,07788,861 2014827,07760,441 2015640,31632,050 2016271,1788,933 201757,9511,759 Total $3,450,676 $309,552 e.ù×ÊÈÓÖÓÙÛÈ×ÉÍÖìÛÊÈÓÙÓÌÛÈÓÍÎ The City has entered into a Certification of Participation agreement to finance natural gas improvements. All Certificates of Participation are being serviced by revenues from the Natural Gas Fund. On March 1, 2009 the City issued $32,665,000 in Certificates of Participation (COPS) Installment Contracts to finance the construction of natural gas improvements. These 30 year COPS have interest rates of 3.00%. Annual payments of principal and interest range from approximately $1,900,000 to $1,744,429. Total principal and interest over a 30-year period will be $65,490,748. The amount shown is net of the unamortized bond discount of $317,582. $ 31,747,418 Annual debt service requirements for Certificates of Participation are as follows: Business-Type Activities Year Ending June 30 Principal Interest 2012 $620,000 $1,579,950 2013635,000 1,561,350 2014655,0001,542,300 2015675,0001,522,650 2016695,0001,500,713 2017 – 2021 3,900,000 7,089,138 2022 – 2026 4,820,0006,174,194 2027 – 2031 6,145,0004,852,550 2032 – 2036 7,990,0002,996,400 2037 – 2039 5,930,000664,125 Total $32,065,000 $29,483,370 The future payments presented above, have not been reduced by $317,582, the unamortized bond discount incurred as a result of the issuance. f. C ÔÛÎÕ×ÉÓÎðÍÎÕÈ×ÊÏðÓÛÚÓÐÓÈÓ×É Current BalanceBalancePortion of July 1, 2010IncreasesDecreasesJune 30, 2011Balance õÍÆ×ÊÎÏ×ÎÈÛÐÛÙÈÓÆÓÈÓ×É: $$$$$ Installment purchase obligations 8,209,458263,6001,736,7186,736,3401,460,007 Compensated absences 1,538,2681,136,9311,011,3041,663,8951,114,810 OPEB liability 1,601,6581,093,108-2,694,766- $11,349,384$2,493,639$2,748,022 $ 11,095,001$2,574,817 èÍÈÛÐÕÍÆ×ÊÎÏ×ÎÈÛÐÛÙÈÓÆÓÈÓ×É 60 Current BalanceBalancePortion of July 1, 2010IncreasesDecreasesJune 30, 2011Balance úÇÉÓÎ×ÉÉÈÃÌ×ÛÙÈÓÆÓÈÓ×É åÛÈ×Êé×Å×ÊöÇÎØ Compensated absences $234,191$226,271$227,274 $ 233,188$156,237 OPEB liability 288,663204,539- 493,202- Installment purchase obligations 298,335-140,086 158,24979,556 Revenue bonds 10,332,0084,756,5745,358,277 9,730,305493,714 Less deferred amount for loss on defeasance (41,509)(105,835)(41,509)(105,835)(8,689) Plus bond premium 56,026254,2993,935306,39024,721 Total revenue bonds 10,346,5254,905,0385,320,703 9,930,860509,746 State revolving loans 4,277,753-827,077 3,450,676827,077 èÍÈÛÐåÛÈ×Êé×Å×ÊöÇÎØ$15,445,467$5,335,848$6,515,140 $ 14,266,175$1,572,616 ÷Ð×ÙÈÊÓÙöÇÎØ Compensated absences $136,377$131,765$134,372 $ 133,770$89,625 OPEB liability 122,50790,533- 213,040- Installment purchase obligations 1,342,017-310,392 1,031,625302,898 Revenue bonds 23,758,9252,041,7132,863,840 22,936,798739,072 Less deferred amount for loss on defeasance (89,816)(103,953)(89,816)(103,953)(8,535) Plus bond premium 235,369109,15616,532327,99325,107 Total revenue bonds 23,904,4782,046,9162,790,556 23,160,838755,644 èÍÈÛÐ÷Ð×ÙÈÊÓÙöÇÎØ$25,505,379$2,269,214$3,235,320 $ 24,539,273$1,148,167 îÛÈÇÊÛÐõÛÉöÇÎØ Compensated absences $43,603$41,128$38,308 $ 46,423$31,105 OPEB liability 62,52343,590- 106,113- Installment purchase obligations 261,763-74,455 187,30867,026 Certificates of participation 32,665,000 - 600,000 32,065,000 620,000 Less unamortized discounts (329,131)-(11,548)(317,583)(11,548) 32,335,869 - 588,452 31,747,417 608,452 Total certificates of participation Revenue bonds 4,584,064886,9891,092,883 4,378,170164,105 Less deferred amount for loss on defeasance (39,977)(45,940)(39,977)(45,940)(3,772) Plus bond premium 39,32647,4212,76283,9856,591 Total revenue bonds 4,583,413888,4701,055,668 4,416,215166,924 èÍÈÛÐîÛÈÇÊÛÐõÛÉöÇÎØ$37,287,171$973,188$1,756,883 $ 36,503,476$873,507 ûÓÊÌÍÊÈöÇÎØ Compensated absences $15,357$14,838$15,504 $ 14,691$9,843 OPEB liability 52,90436,884- 89,788- Installment purchase obligations 227,12649,50076,796 199,83048,120 61 Current BalanceBalancePortion of July 1, 2010IncreasesDecreasesJune 30, 2011Balance Revenue bonds 12,645,00011,934,72412,645,000 11,934,724888,109 Less deferred amount for loss on defeasance (171,303)(308,425)(171,303)(308,425)(25,322) Plus bond premium -638,063-638,06352,385 Total revenue bonds 12,473,69712,264,36212,473,697 12,264,362915,172 èÍÈÛÐûÓÊÌÍÊÈöÇÎØ$12,769,084$12,365,584$12,565,997 $ 12,568,671$973,135 ûËÇÛÈÓÙÉöÓÈÎ×ÉÉöÇÎØ Compensated absences $37,807$36,528$30,857 $ 43,478$29,130 OPEB liability 98,55077,121- 175,671- Installment purchase obligations 1,337,767-424,370 913,397387,345 $1,474,124$113,649$455,227 $ 1,132,546$416,475 èÍÈÛÐûËÇÛÈÓÙÉöÓÈÎ×ÉÉöÇÎØ éÈÍÊÏÅÛÈ×ÊöÇÎØ Compensated absences $35,275$34,082$31,059 $ 38,298$25,660 OPEB liability 43,19533,531- 76,726- Installment purchase obligations 158,933458,00038,069 578,864126,616 $237,403$525,613$69,128 $ 693,888$152,276 èÍÈÛÐéÈÍÊÏÅÛÈ×ÊöÇÎØ éÍÐÓØåÛÉÈ×öÇÎØ Compensated absences $-$397$- $ 397$131 OPEB liability -3,353- 3,353- $-$3,750$- $ 3,750$131 èÍÈÛÐéÍÐÓØåÛÉÈ×öÇÎØ èÍÈÛÐÚÇÉÓÎ×ÉÉÈÃÌ×ÛÙÈÓÆÓÈÓ×É$92,718,628$21,586,846$24,597,695 $ 89,707,779$5,136,307 For governmental activities, compensated absences are liquidated by the General Fund. For business-type activities, compensated absences are liquidated by the respective business-type fund. C.óÎÈ×ÊÖÇÎØúÛÐÛÎÙ×ÉÛÎØûÙÈÓÆÓÈà Balances due to/from other funds at June 30, 2011, consist of the following: Due to the Electric Fund for the purchase of land to be used for incentive grants for industries: General Fund $ 1,171,306 Due to the Electric Fund to be used for capital improvements: Natural Gas Fund $ 4,960,920 Due to the Electric Fund for establishment of: Stormwater Fund $ 111,304 62 Balances due to/from component units at June 30, 2011, consist of the following: Due to the Primary Government for profit distributions from: Monroe ABC Board $ 32,500 Due to the Primary Government for Occupancy Tax: Monroe Tourism Development Authority 19,159 $ 51,659 Transfers to/from other funds at June 30, 2011, consist of the following: From the General Fund to the Airport Fund for current operating needs and construction projects $2,788,142 From the General Fund to the Downtown Monroe Special Revenue Fund for general operations and a one time transfer to fund an economic incentive agreement. 1,305,697 From the Occupancy Tax Special Revenue Fund to the General Fund for administrative fees 9,270 From City Grant Programs Fund to the General Fund for expired incentive grants 211,008 From the Water and Sewer Fund to the Electric Capital Project Fund for proportionate share of new customer service building 469,933 From the Natural Gas Fund to the Electric Capital Project Fund for proportionate share of new Customer Service Building and Energy Services Building 2,183,184 From the General Fund to the Electric Fund for the Helping Hands program 10,000 From the General Fund to the Natural Gas Fund for billing adjustment due to vandalism 208 From the General Fund to the Health & Dental Self Insurance Fund to establish reserve for health claims expenses570,420 From the General Fund to the Airport Capital Project Fund for airport improvements 46,830 From the Downtown Monroe Fund to the Health & Dental Self Insurance Fund to establish reserve for health claims expenses 3,532 From the Water and Sewer Fund to the Health & Dental Self Insurance Fund to establish reserve for health claims expenses104,194 From the Electric Fund to the Health & Dental Self Insurance Fund to establish reserve for health claims expenses47,682 From the Natural Gas Fund to the Health & Dental Self Insurance Fund to establish reserve for health claims expenses22,958 From the Airport Fund to the Health & Dental Self Insurance Fund to establish reserve for health claims expenses14,128 63 From the Aquatics & Fitness Center Fund to the Health & Dental Self Insurance Fund to establish reserve for health claims expenses 19,426 From the Storm Water Fund to the Health & Dental Self Insurance Fund to establish reserve for health claims expenses17,660 From the Workers Compensation Self Insurance Fund to the Health & Dental Self Insurance Fund to establish reserve for health claims expenses 500,000 $ 8,324,272 D.ê×Æ×ÎÇ×É÷ÄÌ×ÎØÓÈÇÊ×ÉÛÎØ÷ÄÌ×ÎÉ×É On-Behalf Payments for Fringe Benefits and Salaries For the fiscal year ended June 30, 2011, the City of Monroe has recognized on-behalf payments for pension contributions made by the state as a revenue and an expenditure of $16,383 for the 49 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 $25,846 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, 2011. 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. IV.òíóîèðãõíæ÷êî÷øíêõûîóâûèóíîé 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, 2011 were $40,007,938. Also, the City, in conjunction with nine Central North Carolina counties and sixty-five 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 $7,707 to the Council during the fiscal year ended June 30, 2011. V. òíóîèæ÷îèçê÷ 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 fringe benefits made to members of the City's fire department by the board of trustees. During the fiscal 64 year ended June 30, 2011, the City reported revenues and expenditures for the payments of $25,846 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, 2011. 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. The City has entered into a joint venture agreement with Public Service Company of North Carolina, Incorporated, a South Carolina corporation d/b/a PSNC Energy (“PSNC”). The City has agreed to design, construct and install natural gas pipeline, a control station, an emergency connector, various valves and electronic data control equipment in Iredell and Cabarrus Counties which is located in PSNC’s service area. These facilities will be “joint facilities” to be owned by the City subject to PSNC’s right to lease capacity in these facilities. PSNC has agreed to pay the City capacity charges in the amount of $6,000,000 payable in monthly installments over a period of six (6) years commencing June 30, 2010. The City will be responsible for providing all operation, maintenance, inspection and repair of the joint facilities. PSNC has agreed to reimburse the City for its share of the costs of operation and maintenance in proportion to the percentage of PSNC’s capacity in the joint facilities, which initially will be 25%. PSNC files SCANA’s annual SEC Form 10-K with the North Carolina Utilities Commission. A full copy of this report can be obtained from the Commission’s website in Docket No. G-5, Sub 400A or on SCANA’s website at: http://www.scana.com/en/investor-relations/financial-reports/. In addition, PSNC’s financial statements can be found on PSNC’s website at: http://www.psncenergy.com/en/financial-statements/. VI.ê÷ðûè÷øíêõûîóâûèóíî 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. VII. ê÷ðûè÷øìûêèãèêûîéûùèóíîé The City and its discretely presented component units engaged in the following transactions during the year ended June 30, 2011: City of Monroe ABC Board: Payments to the City for profit distributions $ 185,000 Payments to the City for law enforcement 67,145 Total $ 252,145 Monroe Tourism Development Authority: Payment of a pro-rata portion of the occupancy tax by the City to the Authority $299,714 Payment by the Authority to the City for the Occupancy Tax Project $199,809 VIII.öçîøúûðûîù÷ The following schedule provides management and citizens with information on the portion of General fund balance that is available for appropriation: 65 Total fund balance – General Fund $ 20,478,381 Less: Inventories 302,008 Prepaids 29,164 Stabilization by State Statute 3,460,359 Streets-Powell Bill 670,113 Appropriated Fund Balance in 2012 budget 2,975,126 Working Capital / Fund Balance Policy 7,701,463 Remaining Fund Balance $ 5,340,148 The outstanding encumbrances are amounts needed to pay any commitments related to purchase orders and contracts that remain unperformed at year-end. Encumbrances as of June 30, 2011 were: Governmental activities: General Fund $ 540,681 Non-Major Funds 5,125 Total governmental activities $ 545,806 Business-type activities: Water and Sewer Fund $ 222,169 Electric Fund 664,479 Natural Gas Fund 156,071 Airport Fund 13,200 Non-Major Funds 585,776 Total business-type activities $ 1,641,695 IX.éçïïûêãøóéùðíéçê÷íöéóõîóöóùûîèùíîèóîõ÷îùó÷é ö×Ø×ÊÛÐÛÎØéÈÛÈ×ûÉÉÓÉÈ×ØìÊÍÕÊÛÏÉ 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. éè÷åûêøéôóìùíïìðóûîù÷ûîøûùùíçîèûúóðóèã Expenditures in the Airport Fund for operations exceeded budget appropriations by $166,844. Higher fuel sales resulted in higher than budgeted fuel purchase expenditures. Management and board will more closely review the budget reports to ensure compliance in future years. XI.éçúé÷ëç÷îè÷æ÷îèé Management has evaluated subsequent events through November 1, 2011, the date the financial statements were available to be issued. 66 CITY OF MONROE, NORTH CAROLINA LAW ENFORCEMENT OFFICERS' SPECIAL SEPARATION ALLOWANC E REQUIRED SUPPLEMENTARY INFORMATIO N SCHEDULE OF FUNDING PROGRES S ûÙÈÇÛÊÓÛÐûÙÙÊÇ×Øçûûð ûÙÈÇÛÊÓÛÐðÓÛÚÓÐÓÈÃûûðçÎÖÇÎØ×ØÛÉÛ ûÙÈÇÛÊÓÛÐæÛÐÇ×ÍÖìÊÍÒ×ÙÈ×ØûûðöÇÎØ×ØùÍÆ×Ê×Øì×ÊÙ×ÎÈÛÕ×ÍÖ æÛÐÇÛÈÓÍÎûÉÉ×ÈÉçÎÓÈùÊ×ØÓÈçûûðêÛÈÓÍìÛÃÊÍÐÐùÍÆ×Ê×ØìÛÃÊÍÐÐ øÛÈ×ÛÚÚÛÛ ÚÙÚÛ Ù 12/31/01$ 1,164,941$ 1,164,94141.32% - 0.00%$ 2 ,819,591 12/31/02 1,210,250 1,210,250 43.58 - 0.00 2 ,777,185 12/31/03 1,295,336 1,295,336 44.50 - 0.00 2 ,910,965 12/31/041,406,3951,406,395 0.002,865,536 49.08 - 12/31/051,400,5931,400,593 0.003,368,588 41.58 - 12/31/061,442,0951,442,095 0.003,623,857 39.79 - 12/31/071,650,6701,650,670 0.003,761,162 43.89 - 12/31/081,703,4011,703,401 0.003,933,354 43.31 - 12/31/092,184,6312,184,631 0.004,461,289 48.97 - 12/31/101,852,8601,852,860 0.004,406,310 42.05 - 67 CITY OF MONROE, NORTH CAROLINA LAW ENFORCEMENT OFFICERS' SPECIAL SEPARATION ALLOWANC E REQUIRED SUPPLEMENTARY INFORMATIO N SCHEDULE OF EMPLOYER CONTRIBUTION S ã×ÛÊ÷ÎØ×ØûÎÎÇÛÐê×ËÇÓÊ×Øì×ÊÙ×ÎÈÛÕ× òÇÎ× ùÍÎÈÊÓÚÇÈÓÍÎùÍÎÈÊÓÚÇÈ×Ø 2001$ 112,650 94.37% 2002 113,793 95.10 2003 111,195 99.37 2004 116,909 106.01 2005 121,658 113.76 2006137,815 119.31 2007138,373 149.68 2008143,756 122.24 2009164,695 127.34 2010174,367 131.97 2011225,936 174.70 îÍÈ×ÉÈÍÈÔ×ê×ËÇÓÊ×ØéÙÔ×ØÇÐ×É Theinformationpresentedintherequiredsupplementaryscheduleswas determinedaspartoftheactuarialvaluationsatthedatesindicated.Additional information as of the latest actuarial valuation follows: Valuation dateDecember 31, 2010 Actuarial cost methodProjected unit credit Amortization methodLevel percentage of pay closed Remaining amortization period20 Years Asset valuation methodMarket value Actuarial assumptions: Investment rate of return*5.00% Projected salary increases*4.5% to 7.85% Cost-of-living adjustmentsnone *Includes inflation at 3.75% 68 CITY OF MONROE, NORTH CAROLINA THE HEALTH CARE PLAN OF THE CITY OF MONROE SUPPLEMENTAL INFORMATION SCHEDULE OF FUNDING PROGRESS ûÙÈÇÛÊÓÛÐûÙÙÊÇ×Øçûûð ûÙÈÇÛÊÓÛÐðÓÛÚÓÐÓÈÃûûðçÎÖÇÎØ×ØÛÉÛ ûÙÈÇÛÊÓÛÐæÛÐÇ×ÍÖìÊÍÒ×ÙÈ×ØûûðöÇÎØ×ØùÍÆ×Ê×Øì×ÊÙ×ÎÈÛÕ×ÍÖ æÛÐÇÛÈÓÍÎûÉÉ×ÈÉçÎÓÈùÊ×ØÓÈçûûðêÛÈÓÍìÛÃÊÍÐÐùÍÆ×Ê×ØìÛÃÊÍÐÐ øÛÈ×ÛÚÚÛÛ ÚÙÚÛ Ù July 1, 2007$ 15,877,000-$ $ 15,877,0000.00%18,700,000$ 84.9% July 1, 2009 19,201,000- 19,201,000 0.0019,927,000 93.4 December 31, 2010 20,670,010- 20,670,010 0.0021,957,134 94.1 69 CITY OF MONROE, NORTH CAROLINA THE HEALTH CARE PLAN OF THE CITY OF MONROE SUPPLEMENTAL INFORMATION SCHEDULE OF EMPLOYER CONTRIBUTION FISCAL YEAR ENDED JUNE 30, 2011 ã×ÛÊ÷ÎØ×ØûÎÎÇÛÐê×ËÇÓÊ×Øì×ÊÙ×ÎÈÛÕ× òÇÎ× ùÍÎÈÊÓÚÇÈÓÍÎùÍÎÈÊÓÚÇÈ×Ø 2009$ 1,502,00023.2% 2010 1,513,000 26.2 2011 1,837,058 13.8 îÍÈ×ÉÈÍÈÔ×ê×ËÇÓÊ×ØéÙÔ×ØÇÐ×É 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 dateDecember 31, 2010 Actuarial cost methodProjected unit credit Amortization methodLevel percentage of pay open Remaining amortization period30 Years Asset valuation methodMarket value Actuarial assumptions: Investment rate of return*4.00% Medical cost trend rate Pre-Medicare trend rate10.50%-5.00% Post-Medicare trend rate8.50%-5.00% Year of ultimate trend rate2018 *Includes inflation at3.00% Cost-of-living adjustmentsnone 70 îÍÎÏÛÒÍÊõÍÆ×ÊÎÏ×ÎÈÛÐöÇÎØÉ éÌ×ÙÓÛÐê×Æ×ÎÇ×öÇÎØÉ éÌ×ÙÓÛÐê×Æ×ÎÇ×öÇÎØÉ are used to account for specific revenues that are legally restricted to expenditures for specified purposes. ùÍÏÏÇÎÓÈÃø×Æ×ÐÍÌÏ×ÎÈ - 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. øÍÅÎÈÍÅÎïÍÎÊÍ× - This fund is used to account for specific revenues that are restricted for the purpose of downtown revitalization. íÙÙÇÌÛÎÙÃèÛÄ- This fund is used to account for specific revenues that are restricted for the purpose of tourism development. ùÓÈÃõÊÛÎÈìÊÍÕÊÛÏÉ - 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. éÈÛÈ×õÊÛÎÈìÊÍÕÊÛÏÉ - This fund is used to account for specific state grant revenues that are restricted for housing development in designated areas of the City. ùÛÌÓÈÛÐìÊÍÒ×ÙÈÉöÇÎØÉ ùÛÌÓÈÛÐìÊÍÒ×ÙÈÉöÇÎØÉ account for financial resources to be used for the acquisition or construction of major capital facilities other than those financed by proprietary funds. ùÛÌÓÈÛÐìÊÍÒ×ÙÈÉ - This fund is used to account for the purchase, renovation, furnishing, or construction of roadway and facility improvements. íÙÙÇÌÛÎÙÃèÛÄìÊÍÒ×ÙÈÉ - This fund is used to account for tourism related capital expenditures. CITY OF MONROE, NORTH CAROLINA COMBINING BALANCE SHEET NONMAJOR GOVERNMENTAL FUNDS June 30, 2011 éÌ×ÙÓÛÐê×Æ×ÎÇ× ùÍÏÏÇÎÓÈøÍÅÎÈÍÅÎíÙÙÇÌÛÎÙÃùÓÈÃõÊÛÎÈéÈÛÈ×õÊÛÎÈ Ã ø×Æ×ÐÍÌÏ×ÎÈïÍÎÊÍ×èÛÄìÊÍÕÊÛÏÉìÊÍÕÊÛÏÉ ûéé÷èé Cash and cash equivalents53,489 $ $ 13,213$ -$ -$ - Taxes receivable- 2,743 29,627 - - Accounts receivable 1,106 126 - - - Due from other governments - - - - 40,993 Due from component unit - - - - - Loans receivable16,773 - - - - Total assets71,368$ 16,082$ 29,627$ -$ 40,993$ ðóûúóðóèó÷éûîøöçîøúûðûîù÷é Liabilities: Accounts payable and accrued liabilities19 $ $ 8,213$ -$ -$ 40,993 Deferred revenue16,773 2,744 29,627 - - Total liabilities16,792 10,957 29,627 - 40,993 Fund balances: Restricted: Stabilization by State Statute1,106 5 ,259 - - - (134) - - - Assigned53,470 5,125 - - - Total fund balances54,576 16,082$ 29,627$ -$ 40,993$ Total liabilities and fund balances71,368$ 72 STATEMENT 1 ùÛÌÓÈÛÐ ìÊÍÒ×ÙÈöÇÎØÉ öÇÎØÉíÙÙÇÌÛÎÙÃèÍÈÛÐîÍÎÏÛÒÍÊ ùÛÌÓÈÛÐèÛÄõÍÆ×ÊÎÏ×ÎÈÛÐ èÍÈÛÐìÊÍÒ×ÙÈÉìÊÍÒ×ÙÈÉèÍÈÛÐöÇÎØÉ $ 30,16866,702$ 1,166,392$ 1,196,560$ 1,263,262$ -32,370 - - 32,370 -1,232 - - 1,232 7,20040,993 - 7,200 48,193 -- 19,159 19,159 19,159 -16,773 - - 16,773 $ 37,368158,070$ 1,185,551$ 1,222,919$ 1,380,989$ $ 1,49349,225$ -$ 1,493$ 50,718$ -49,144 - - 49,144 1,49398,369 - 1,493 99,862 -6,365 - - 6,365 35,875 1,185,551 1,221,426 1,274,762 53,336 35,875 1,185,551 1,221,426 1,281,127 59,701 37,368$ 1,185,551$ 1,222,919$ 1,380,989$ $158,070 73 CITY OF MONROE, NORTH CAROLINA COMBINING STATEMENT OF REVENUES, EXPENDITURES, AN D CHANGES IN FUND BALANCE S NONMAJOR GOVERNMENTAL FUNDS For the Fiscal Year Ended June 30, 2011 éÌ×ÙÓÛÐê×Æ×ÎÇ× ùÍÏÏÇÎÓÈøÍÅÎÈÍÅÎíÙÙÇÌÛÎÙÃùÓÈÃõÊÛÎÈéÈÛÈ×õÊÛÎÈ Ã ø×Æ×ÐÍÌÏ×ÎÈïÍÎÊÍ×èÛÄìÊÍÕÊÛÏÉìÊÍÕÊÛÏÉ ê÷æ÷îç÷é Ad valorem taxes-$ - $ $ 5 0,285$ - $ - Other taxes and licenses - - - 308,984 - Restricted intergovernmental - 95,221 - - 4 0,000 Miscellaneous - - 3 70 - - Program income 2,400 - - - - 2,968 - - - Investment earnings- 53,623 308,984 40,000 95,221 Total revenues2,400 ÷äì÷îøóèçê÷é Current: Economic and physical development: Administration77 - 1,539,789 - - Loan assistance - - - - 18,600 Incentive grants - - - -80,424 Program costs - - - -95,221 Tourism - - - 299,714 - Capital outlay- - - - - Total expenditures77 1,539,789 299,714 99,024 95,221 Revenues over (under) expenditures2,323 (1,486,166) 9,270 (59,024) - íèô÷êöóîûîùóîõéíçêù÷éçé÷é Transfers from other funds - - 1 ,305,697 - - Transfers to other funds- (3,532) (9,270) (211,008) - Total other financing sources (uses)- 1,302,165 (9,270) (211,008) - Net change in fund balances2,323 (184,001) - - (270,032) Fund balances, beginning52,253 - 270,032 - Fund balances, ending54,576$ 5,125$ -$ -$ -$ 74 STATEMENT 2 ùÛÌÓÈÛÐ ìÊÍÒ×ÙÈöÇÎØÉ öÇÎØÉíÙÙÇÌÛÎÙÃèÍÈÛÐîÍÎÏÛÒÍÊ ùÛÌÓÈÛÐèÛÄõÍÆ×ÊÎÏ×ÎÈÛÐ èÍÈÛÐìÊÍÒ×ÙÈÉìÊÍÒ×ÙÈÉèÍÈÛÐöÇÎØÉ $ -$ -$ 50,285-$ $ 5 0,285 - - 308,984- 3 08,984 304,027199,809503,836 639,057 1 35,221 153 153- 523 3 70 2,400 - - - 2,400 - - - 2,968 2,968 304,180 199,809 503,989 1,004,217 500,228 11,10211,102- 1,550,968 1 ,539,866 - - 18,600- 1 8,600 - - 80,424- 8 0,424 - - 95,221- 9 5,221 - - 299,714- 2 99,714 337,578 150,000 487,578 487,578 - 2,033,825 337,578 161,102 498,680 2,532,505 (33,398)(1,533,597) 38,707 5,309 (1,528,288) -1,305,697 - - 1,305,697 (223,810) - - - (223,810) 1,081,887 - - - 1,081,887 (33,398)(451,710) 38,707 5,309 (446,401) 511,411 69,273 1,146,844 1,216,117 1,727,528 $59,701 35,875$ 1,185,551$ 1,221,426$ 1,281,127$ 75 STATEMENT 3 CITY OF MONROE, NORTH CAROLINA COMBINING STATEMENT OF NET ASSET S INTERNAL SERVICE FUND S une 30, 2011 J ô×ÛÐÈÔÛÎØåÍÊÑ×ÊÉìÊÍÌ×ÊÈÃÛÎØ ø×ÎÈÛÐùÍÏÌ×ÎÉÛÈÓÍÎðÓÛÚÓÐÓÈà öÇÎØöÇÎØèÍÈÛÐ öÇÎØ ûéé÷èé Current assets: $1,016,662$ 488,2161,088,034$ 2,592,912$ Cash and investment s Accounts receivable (net)109,226 - 62 109,288 9,999-20,068 Deposits10,069 Total current assets 1,098,0331,135,957 488,278 2,722,268 ðóûúóðóèó÷é Current Liabilities: - 5,974 165,775 Accounts payable and accrued liabilities159,801 Total current liabilities159,801 - 5,974 165,775 î÷èûéé÷èé Unrestricted976,156$ 1,098,033$ 482,304$ 2,556,493$ 76 STATEMENT 4 CITY OF MONROE, NORTH CAROLINA COMBINING STATEMENT OF REVENUES, EXPENSES, AND CHANGES IN FUND NET ASSET S INTERNAL SERVICE FUND S FOR THE FISCAL YEAR ENDED June 30, 2011 ô×ÛÐÈÔÛÎØåÍÊÑ×ÊÉìÊÍÌ×ÊÈÃÛÎØ ø×ÎÈÛÐùÍÏÌ×ÎÉÛÈÓÍÎðÓÛÚÓÐÓÈà öÇÎØöÇÎØèÍÈÛÐ öÇÎØ íì÷êûèóîõê÷æ÷îç÷é Interfund charges and employee contributions4,629,055$ -$ 645,000$ 5,274,055$ Other operating revenue192,879 1,164 3,521 197,564 1,164 648,521 5,471,619 Total operating revenues4,821,934 íì÷êûèóîõ÷äì÷îé÷é Operating expenses- 123,748- 123,748 Health care clinic66,880- - 66,880 5,161,938- 5,161,938- Health benefit claims and premium s Property and liability claims and premiums- - 547,421 547,421 123,748 547,421 5,899,987 Total operating expenses5,228,818 Operating income(406,884) (122,584) 101,100 (428,368) îíîíì÷êûèóîõê÷æ÷îç÷é Transfers from (to) other funds -570,420 - 570,420 General Fun d Aquatic Center Fun19,426- 19,426- d 3,532--3,532 Downtown Monroe Fun d Water and Sewer Fun -104,194 - 104,194 d -17,660 - 17,660 Stormwater Fun d Electric Fund47,682 - - 47,682 atural Gas Fun -22,958 - 22,958 Nd Airport Fund14,128 - - 14,128 -500,000 - 500,000 Workers' Compensation Fun d Health and Dental Fun (500,000)- - (500,000) d 2,264 336 3,069 Investment earnings469 (497,736) 336 803,069 Total non operating revenues1,300,469 Change in net assets893,585 (620,320) 101,436 374,701 î÷èûéé÷èé 1,718,353 380,868 2,181,792 Beginning82,571 1,098,033$ 482,304$ 2,556,493$ Ending976,156$ 77 STATEMENT 5 CITY OF MONROE, NORTH CAROLINA COMBINING STATEMENT OF CASH FLOWS INTERNAL SERVICE FUND S FOR THE FISCAL YEAR ENDED June 30, 2011 ô×ÛÐÈÔÛÎØåÍÊÑ×ÊÉìÊÍÌ×ÊÈÃÛÎØ ø×ÎÈÛÐùÍÏÌ×ÎÉÛÈÓÍÎðÓÛÚÓÐÓÈà öÇÎØöÇÎØöÇÎØèÍÈÛÐ íì÷êûèóîõûùèóæóèó÷é Cash received for services4,629,055$ -$ 645,226$ 5,274,281$ Other operating revenue281,595 1,164 3,521 286,280 Cash paid for goods and services(5,489,002) (146,731) (547,898) (6,183,631) et cash provided (used) by operating N activities(578,352) (145,567) 100,849 (623,070) ùûéôöðíåéöêíïîíîùûìóèûðöóîûîùóîõ ûùèóæóèó÷é Transfers (to) from other funds1,300,000 (500,000) - 800,000 Net cash provided (used) by noncapital financing (500,000) - 800,000 activities1,300,000 óîæ÷éèóîõûùèóæóèó÷ é Investment earnings469 2,264 336 3,069 Net cash provided (used) by investing 2,264 336 3,069 activities469 et increase (decrease) in cash and N (643,303)722,117 101,185 179,999 investment s ùûéôûîøóîæ÷éèï÷îèé Beginning of year294,545 1,731,337 387,031 2,412,913 End of year1,016,662$ 1,088,034$ 488,216$ 2,592,912$ ê×ÙÍÎÙÓÐÓÛÈÓÍÎÍÖÍÌ×ÊÛÈÓÎÕÓÎÙÍÏ×ÐÍÉÉÈÍÎ×È ÙÛÉÔÌÊÍÆÓØ×ØÇÉ×ØÚÃÍÌ×ÊÛÈÓÎÕÛÙÈÓÆÓÈÓ×É Operating income (loss)(406,884)$ (122,584)$ 101,100$ (428,368)$ Adjustments to reconcile operating income(loss) to net cash provided (used) by operating activities: Change in assets and liabilities (Increase) decrease in accounts receivable8,286 (9,502) 226 (990) (Increase) decrease in prepaid expenses80,430 - - 80,430 Increase (decrease) in accounts payable and accrued liabilities(260,184) (13,481) (477) (274,142) Total adjustments(171,468)(22,983)(251) (194,702) et cash provided (used) by operating N activities(578,352)$ (145,567)$ 100,849$ (623,070)$ 78 SCHEDULE 6 CITY OF MONROE, NORTH CAROLINA GENERAL FUND SCHEDULE OF REVENUES, EXPENDITURES, AN D CHANGES IN FUND BALANCES -- BUDGET AND ACTUAL For the Fiscal Year Ended June 30, 2011 æÛÊÓÛÎÙ× ìÍÉÓÈÓÆ× úÇØÕ×ÈûÙÈÇÛÐî×ÕÛÈÓÆ× ê÷æ÷îç÷é Ad valorem taxes: Taxes$ 18,348,766$ 19,062,719$ 713,953 Penalties and interest68,945103,615 34,670 Total18,417,71119,166,334 748,623 Other taxes and licenses: Privilege licenses784,362720,949 (63,413) Gross receipts tax on short-term rental property38,00048,556 10,556 Local franchise fees40,00040,317 317 Motor vehicle tax112,178129,907 17,729 Total974,540939,729 (34,811) Unrestricted intergovernmental: Local option sales taxes3,372,9663,905,931 532,965 Telecommunications sales tax510,524489,371 (21,153) Utility franchise tax1,320,0121,543,148 223,136 Cablevision franchise fees277,500290,873 13,373 Beer and wine tax47,000168,010 121,010 State fire fees2,8893,853 964 185,000 (25,000) ABC profit distribution210,000 ABCfitditibti210000185000(25000) Total5,740,8916,586,186 845,295 Restricted intergovernmental: Powell Bill allocation 979,430 1,000,949 21,519 Public safety reimbursement grants 574,076 441,086 (132,990) On-behalf payments - Fire and Rescue 46,229- 46,229 ABC Revenue for law enforcement 74,000 67,145 (6,855) Resource officer reimbursement 95,000 99,946 4,946 Senior Center grant 4,082 4,081 (1) Equitable sharing of federally forfeited property 78,005- 78,005 Transportation reimbursement grant30,000 22,560 (7,440) Total1,756,5881,760,001 3,413 Sales and services: Recreational fees878,850699,631 (179,219) Utilities collection fees413,424410,898 (2,526) Building permit fees187,150312,750 125,600 Cemetery revenues40,82230,662 (10,160) Sale of fixed assets128,00032,936 (95,064) Rentals60,88578,468 17,583 Other fees127,142142,911 15,769 Total1,836,2731,708,256 (128,017) - Continued - 79 SCHEDULE 6, Continued CITY OF MONROE, NORTH CAROLINA GENERAL FUND SCHEDULE OF REVENUES, EXPENDITURES, AN D CHANGES IN FUND BALANCES -- BUDGET AND ACTUAL For the Fiscal Year Ended June 30, 2011 æÛÊÓÛÎÙ× ìÍÉÓÈÓÆ× ûÙÈÇÛÐî×ÕÛÈÓÆ× úÇØÕ×È Investment earnings$400,000 61,318$ (338,682)$ Miscellaneous: Payment in lieu of taxes442,692 489,671 46,979 Donations 30,925 33,144 2,219 Insurance reimbursement 29,966- 29,966 Other68,307 193,819 125,512 Total541,924 746,600 204,676 30,968,424 1,300,497 Total revenues29,667,927 ÷äì÷îøóèçê÷é Current: General government: Administration Salaries and employee benefits1,808,3631,791,357 17,006 Operating expenditures2,094,2351,375,073 719,162 Capital outlay116,00097,865ill 18,135 (1,399,846) 1 Interdepartmental charges(1,399,845) 1,864,449 754,304 2,618,753 Planning and zoning Salaries and employee benefits536,100519,947 16,153 Operating expenditures 75,195 46,588 28,607 Interdepartmental charges (37,411)(37,411) - 529,124 44,760 573,884 Engineering Salaries and employee benefits829,451816,058 13,393 Operating expenditures103,93583,067 20,868 Interdepartmental charges(347,669) (347,669) - 551,456 34,261 585,717 Finance Salaries and employee benefits1,674,9681,640,255 34,713 Operating expenditures317,028269,342 47,686 (1,828,117) - Interdepartmental charges(1,828,117) 81,480 82,399 163,879 - Continued - 80 SCHEDULE 6, Continued CITY OF MONROE, NORTH CAROLINA GENERAL FUND SCHEDULE OF REVENUES, EXPENDITURES, AN D CHANGES IN FUND BALANCES -- BUDGET AND ACTUAL For the Fiscal Year Ended June 30, 2011 æÛÊÓÛÎÙ× ìÍÉÓÈÓÆ× úÇØÕ×ÈûÙÈÇÛÐî×ÕÛÈÓÆ× Operations Center Salaries and employee benefits$ 513,572$ 480,191$ 33,381 Operating expenditures213,597169,830 43,767 Interdepartmental charges (598,058)(576,481) 21,577 150,688 51,963 98,725 Special appropriations 201,530 65,776 Operating expenditures267,306 Total4,360,227 3,280,002 1,080,225 Transportation: Streets and highways Salaries and employee benefits964,325898,269 66,056 Operating expenditures1,619,0291,217,806 401,223 Capital outlay629,987488,870 141,117 Interdepartmental charges(505,400) (631,611) 126,211 Total2,707,941 1,973,334 734,607 Public safety: Police Salaries and employee benefits6,892,6226,830,604 62,018 Operating expenditures1,739,3231,356,425 382,898 41,640 (25,852) Capital outlay15,788 8,228,669 419,064 8,647,733 Fire Salaries and employee benefits5,434,5545,300,632 133,922 Operating expenditures497,298465,247 32,051 Capital outlay8,500 5,023 3,477 5,770,902 169,450 5,940,352 Building standards and code enforcement Salaries and employee benefits340,423331,860 8,563 Operating expenditures80,420 46,941 33,479 Total420,843 378,801 42,042 14,378,372 630,556 Total15,008,928 - Continued - 81 SCHEDULE 6, Continued CITY OF MONROE, NORTH CAROLINA GENERAL FUND SCHEDULE OF REVENUES, EXPENDITURES, AN D CHANGES IN FUND BALANCES -- BUDGET AND ACTUAL For the Fiscal Year Ended June 30, 2011 æÛÊÓÛÎÙ× ìÍÉÓÈÓÆ× ûÙÈÇÛÐî×ÕÛÈÓÆ× úÇØÕ×È Culture and recreation: Salaries and employee benefits $ 2,602,814$ 2,522,101$ 80,713 Operating expenditures1,971,4561,750,417 221,039 Capital outlay200,684198,016 2,668 Interdepartmental charges (378,232)(378,232) - Total4,396,722 4,092,302 304,420 Debt service: Principal retirement1,624,6941,961,757 (337,063) Interest and other charges400,00060,964 339,036 Total2,024,694 2,022,721 1,973 Total expenditures28,498,512 25,746,731 2,751,781 Revenues over (under) expenditures1,169,415 5,221,693 4,052,278 íèô÷êöóîûîùóîõéíçêù÷éçé÷é Transfers from (to) other funds: Special Revenue Funds Occupancy Tax Fun9,0009,270 270 OTFd90009270270 d City Grant Programs 211,008 211,008 - Capital Projects Funds Downtown Monroe (1,531,143) (1,305,697) 225,446 Airport (46,830) (46,830) - Internal Service Funds Funds Self Insured Health And Dental Fund (570,420) (570,420) - Electric Fund (10,000) (10,000) - Natural Gas Fund (208) (208) - Airport Fund (2,922,439) (2,788,142) 134,297 Repayment of advance from other funds (131,478) (131,477) 1 Installment purchase obligations issued285,000 263,600 (21,400) Total other financing sources (uses)(4,707,510) (4,368,896) 338,614 öçîøúûðûîù÷ûììêíìêóûè÷ø 3,538,095 - (3,538,095) Net change in fund balance-$ 852,797 852,797$ Fund balance, beginning19,625,584 Fund balance, ending$20,478,381 82 SCHEDULE 7, Page 1 of 5 CITY OF MONROE, NORTH CAROLINA SPECIAL REVENUE FUND S COMMUNITY DEVELOPMENT SCHEDULE OF REVENUES, EXPENDITURES, AND CHANGES IN FUND BALANCES -- BUDGET AND ACTUAL For the Fiscal Year Ended June 30, 2011 æÛÊÓÛÎÙ× ìÍÉÓÈÓÆ× úÇØÕ×ÈûÙÈÇÛÐî×ÕÛÈÓÆ× ê÷æ÷îç÷é Program income5,000$ 2,400$ (2,600)$ ÷äì÷îøóèçê÷é Current: Economic and physical development: Administration500 77 423 Revenues over (under) expenditures4,500 (3,023) 2,323 - 4,500 ûììêíìêóûèóíîèíöçîøúûðûîù÷(4,500) Net change in fund balance-$ 2,323 $1,477 Fund balance, beginning 52,253 Fund balance, ending $ 54,576 83 SCHEDULE 7, Page 2 of 5 CITY OF MONROE, NORTH CAROLINA SPECIAL REVENUE FUND S DOWNTOWN MONROE SCHEDULE OF REVENUES, EXPENDITURES, AND CHANGES IN FUND BALANCES -- BUDGET AND ACTUAL For the Fiscal Year Ended June 30, 2011 æÛÊÓÛÎÙ× ìÍÉÓÈÓÆ× ÇÕ×ÈÙÈÇÛ×ÕÛÈÆ× úØûÐîÓ ê÷æ÷îç÷é Ad valorem taxes41,710$ 8,575 $ $ 50,285 Miscellaneous 1,000370(630) Investment earnings1,000 2,968 1,968 Total 43,710 53,623 9,913 ÷äì÷îøóèçê÷é Current: Economic and physical development: Administration1,603,580 63,791 1,539,789 Capital Outlay -- - Total1,603,580 1,539,789 63,791 (1,486,166) 73,704 Revenues over (under) expenditures(1,559,870) íèô÷êöóîûîùóîõéíçêù÷éçé÷é Transfers from (to) other funds: General Fund1,531,143 (225,446) 1,305,697 (3,532)(3,532) - Health and Dental Fun d Total other financing sources (uses)1,527,611 1,302,165 (225,446) öçîøúûðûîù÷ûììêíìêóûè÷ø 32,259 - (32,259) (184,001) (184,001)$ Net change in fund balance-$ Fund balance, beginning 189,126 Fund balance, ending $ 5,125 84 SCHEDULE 7, Page 3 of 5 CITY OF MONROE, NORTH CAROLINA SPECIAL REVENUE FUND S OCCUPANCY TA X SCHEDULE OF REVENUES, EXPENDITURES, AND CHANGES IN FUND BALANCES -- BUDGET AND ACTUAL For the Fiscal Year Ended June 30, 2011 æÛÊÓÛÎÙ× ìÍÉÓÈÓÆ× ÇÕ×ÈÙÈÇÛ×ÕÛÈÆ× úØûÐîÓ ê÷æ÷îç÷é Other taxes and licenses: 308,984$ 8,984$ Occupancy tax300,000$ ÷äì÷îøóèçê÷é Current: Economic and physical development: Tourism291,000 299,714 (8,714) Revenues over expenditures9,000 9,270 270 íèô÷êöóîûîùóîõçé÷é Transfers to other funds: (9,270) (270) General Fund(9,000) Net change in fund balance-$ - $- Fund balance, beginning - Fund balance, ending $ - 85 SCHEDULE 7, Page 4 of 5 CITY OF MONROE, NORTH CAROLINA SPECIAL REVENUE FUND S CITY GRANT PROGRAMS SCHEDULE OF REVENUES, EXPENDITURES, AND CHANGES I N FUND BALANCES -- BUDGET AND ACTUAL From Inception and For the Fiscal Year Ended June 30, 2011 ûÙÈÇÛÐÛÊÛÎÙ× æÓ ìÊÍÒ×ÙÈìÊÓÍÊùÇÊÊ×ÎÈèÍÈÛÐÈÍìÍÉÓÈÓÆ× ÇÈÍÊÂÛÈÍÎ×ÛÊ×ÛÊÛÈ××ÕÛÈÆ× ûÔÓÓããøîÓ ê÷æ÷îç÷é Restricted intergovernmental688,604$ 438,604$ 40,000$ 478,604$ (210,000)$ ÷äì÷îøóèçê÷é Current: Economic and physical development: Loan assistance257,008 139,582 98,826 18,600 158,182 Incentive grants3,280,076 2,989,651 80,424 3,070,075 210,001 Total expenditures3,537,084 3,129,233 99,024 3,228,257 308,827 Revenues over (under) expenditures(2,848,480) (2,690,629) (59,024) (2,749,653) 98,827 íèô÷êöóîûîùóîõéíçêù÷éçé÷é Transfers from (to) other funds: General Fund2,573,480 2,784,488(211,008) - 2,573,480 State Grant Project Fund - 8,000- 8,000 8,000 Community Development Fund275,000 168,173 - 168,173 (106,827) Total other financing sources (uses)2,848,480 2,960,661 (211,008) 2,749,653 (98,827) Revenues and other financing sources over expenditures and other financing use-$$270,032(270,032) -$ $ - Fund balance, beginning270,032 Fund balance, ending-$ 86 SCHEDULE 7, Page 5 of 5 CITY OF MONROE, NORTH CAROLINA CAPITAL PROJECT FUNDS STATE GRANT PROGRAMS SCHEDULE OF REVENUES, EXPENDITURES, AND CHANGES I N FUND BALANCES -- BUDGET AND ACTUAL From Inception and For the Fiscal Year Ended June 30, 2011 ûÙÈÇÛÐÛÊÛÎÙ× æÓ ìÊÍÒ×ÙÈìÊÓÍÊùÇÊÊ×ÎÈèÍÈÛÐÈÍìÍÉÓÈÓÆ× ÇÈÍÊÂÛÈÍÎ×ÛÊ×ÛÊÛÈ××ÕÛÈÆ× ûÔÓÓããøîÓ ê÷æ÷îç÷é Restricted intergovernmental (09-C-1999)$400,000 -$ 95,221$ 95,221$ (304,779)$ Total Revenues400,000 - 95,221 95,221 (304,779) ÷äì÷îøóèçê÷é Current: Economic and physical development: Program costs (09-C-1999)400,000-95,221 304,779 95,221 Total expenditures400,000 - 95,221 95,221 304,779 -$ - -$ Revenues over expenditures-$ $ - Fund balance, beginning- Fund balance, ending-$ 87 SCHEDULE 8, Page 1 of 2 CITY OF MONROE, NORTH CAROLINA CAPITAL PROJECTS FUNDS CAPITAL PROJECTS SCHEDULE OF REVENUES, EXPENDITURES, AND CHANGE S IN FUND BALANCES -- BUDGET AND ACTUAL From Inception And For The Fiscal Year Ended June 30, 2011 ûÙÈÇÛÐÛÊÛÎÙ× æÓ ìÊÍÒ×ÙÈìÊÓÍÊùÇÊÊ×ÎÈèÍÈÛÐÈÍìÍÉÓÈÓÆ× ûÇÈÔÍÊÓÂÛÈÓÍÎã×ÛÊÉã×ÛÊøÛÈ×î×ÕÛÈÓÆ× ê÷æ÷îç÷é Restricted intergovernmental638,000$ 183,183$ 304,027$ 487,210$ (150,790)$ Miscellaneous- - 153 153 153 Investment earnings- 1,595 - 1,595 1,595 Total revenues638,000 184,778 304,180 488,958 (149,042) ÷äì÷îøóèçê÷é Capital outlay: Construction costs capitalized3,074,233 2,711,513 336,0853,047,598 26,635 Construction in progress10,000 3,599 1,4935,092 4,908 135,646 - 135,646 153,374 Other costs289,020 2,850,758 337,578 3,188,336 184,917 Total expenditures3,373,253 (2,665,980) (33,398) (2,699,378) 35,875 Revenues over (under) expenditures(2,735,253) íèô÷êöóîûîùóîõéíçêù÷éçé÷é Transfers from (to) other funds: General Fund343,533 343,533 - 343,533 - Installment purchase obligations issued2,391,7202,391,720 2,391,720- - Total other financing sources (uses)2,735,253 2,735,253 - 2,735,253 - Revenues and other financing sources over (under) expenditures and other financing uses-$ 69,273$ (33,398) 35,875$ 35,875$ Fund balance, beginning69,273 unaance, enng, Fdbldi$35875 88 SCHEDULE 8, Page 2 of 2 CITY OF MONROE, NORTH CAROLINA CAPITAL PROJECT FUNDS OCCUPANCY TAX CAPITAL PROJECT S SCHEDULE OF REVENUES, EXPENDITURES, AND CHANGES I N FUND BALANCES -- BUDGET AND ACTUAL From Inception and For the Fiscal Year Ended June 30, 2011 ûÙÈÇÛÐÛÊÛÎÙ× æÓ ìÊÍÒ×ÙÈìÊÓÍÊùÇÊÊ×ÎÈèÍÈÛÐÈÍìÍÉÓÈÓÆ× ûÇÈÔÍÊÓÂÛÈÓÍÎã×ÛÊã×ÛÊøÛÈ×î×ÕÛÈÓÆ× ê÷æ÷îç÷é Restricted intergovernmental$1,228,362 1,150,049$ 199,809$ 1,349,858$ 121,496$ Total Revenues1,228,362 1,150,049 199,809 1,349,858 121,496 ÷äì÷îøóèçê÷é Current: Construction costs capitalized 150,000 150,000150,000- - Construction in progress 20,000 - - 20,000- Other costs174,883 118,035 11,102 129,137 45,746 ota expentures,,,,, Tldi34488311803516110227913765746 evenues uner expentures,,,,,,, Rddi8834791032014387071070721187242 íèô÷êöóîûîùóîõéíçêù÷é Transfers from other funds: erormngrtsente,,-,, PfiACr10181411483011483013016 Revenues and other financing sources over uner expentures,,,,,,, (d)di$985293$114684438707$1185551$200258 unaance,egnnng,, Fdblbii1146844 unaance, enng,, Fdbldi$1185551 89 SCHEDULE 9 CITY OF MONROE, NORTH CAROLINA WATER AND SEWER FUND SCHEDULE OF REVENUES AND EXPENDITURES - - UDGET AND ACTUAL (NON-GAAP) B For the Fiscal Year Ended June 30, 2011 æÛÊÓÛÎÙ× ìÍÉÓÈÓÆ× úÇØÕ×ÈûÙÈÇÛÐî×ÕÛÈÓÆ× ê÷æ÷îç÷é Operating revenues: Charges for services: Water sales5,247,452$ 5,432,518$ 185,066$ Sewer charges6,451,3906,599,850 148,460 Water and sewer taps132,15544,749 (87,406) County waste water charges600,000 516,152 (83,848) 12,593,269 162,272 12,430,997 Other operating revenues282,981 323,331 40,350 12,916,600 202,622 Total operating revenues12,713,978 Nonoperating revenues: Availabilityfees316,510, 281,924,(34,586), Availabilityfees316510281924(34586) Other nonoperating revenues971 13,324 12,353 Investment earnings400,045 86,211 (313,834) Total nonoperating revenues717,526 381,459 (336,067) 13,298,059 (133,445) Total revenues13,431,504 ûììêíìêóûèóíîèíöçîøúûðûîù÷ -(1,752,737) 1,752,737 Total revenues11,678,767 13,298,059 1,619,292 íèô÷êöóîûîùóîõéíçêù÷é Transfers from other funds: Water and Sewer Capital Projects Fund1,158,238 1,158,238 - Refunding revenue bonds issued4,670,131 4,670,131 - Premium on refunding revenue bonds issued254,299 254,299 - Total other financing sources6,082,668 6,082,668 - Total revenues and other financing sources17,761,435$ 19,380,727$ 1,619,292$ - Continued - 90 SCHEDULE 9, Continued CITY OF MONROE, NORTH CAROLINA WATER AND SEWER FUND SCHEDULE OF REVENUES AND EXPENDITURES - - UDGET AND ACTUAL (NON-GAAP) B For the Fiscal Year Ended June 30, 2011 æÛÊÓÛÎÙ× ìÍÉÓÈÓÆ× úÇØÕ×ÈûÙÈÇÛÐî×ÕÛÈÓÆ× ÷äì÷îøóèçê÷é Distribution system: Salaries and employee benefits2,243,330$ 2,204,906$ 38,424$ Operating expenditures2,179,856 2,168,397 11,459 Total4,423,186 4,373,303 49,883 Water filter plant: Salaries and employee benefits653,292642,852 10,440 Operating expenditures2,148,294 1,761,733 386,561 2,404,585 397,001 Total2,801,586 Waste treatment plant: Salaries and employee benefits892,440827,679 64,761 Operating expenditures1,632,164 1,762,328 (130,164) 65,403 Total2,524,604 2,590,007 () o,,,9,7(,) Debt service: Principal retirement6,406,1376,325,440 80,697 694,334 (80,039) Interest and other charges614,295 7,019,774 658 Total7,020,432 Capital outlay417,500 64,447 353,053 Total expenditures17,187,308 16,452,116 735,192 íèô÷êöóîûîùóîõçé÷é Transfers to other funds: Health & Dental Fun 104,194104,194 - d 469,933 - Electrical Capital Project Fund469,933 574,127 - Total other financing uses574,127 Total expenditures and other financing uses17,761,435$ 17,026,243$ 735,192$ - Continued - 91 SCHEDULE 9, Continued CITY OF MONROE, NORTH CAROLINA WATER AND SEWER FUND SCHEDULE OF REVENUES AND EXPENDITURES - - UDGET AND ACTUAL (NON-GAAP) B For the Fiscal Year Ended June 30, 2011 ê×ÙÍÎÙÓÐÓÛÈÓÍÎÖÊÍÏÚÇØÕ×ÈÛÊÃÚÛÉÓÉÏÍØÓÖÓ×ØÛÙÙÊÇÛÐÈÍÖÇÐÐÛÙÙÊÇÛÐ Total revenues $ 19,380,727 Total expenditures and other financing uses17,026,243 Revenues and other financing sources over expenditures and other financing uses2,354,484 Reconciling items: Debt principal 6,325,440 Amortization of deferred loss on refunding(7,768) Amortization of bond premimum 3,935 Amortization of bond issuance costs (4,070) Revenue bonds issued (4,756,574) Premium on revenue bonds issued (254,299) Bond issuance cost of revenue bonds issued86,444 Deferred loss on refunding from issuance of revenue bonds72,094 Capital outlay 64,447 Transfer from Water and Sewer Capital Projects Funds(1,158,238) pj(,,) Net expense from capital projects consolidation (112,766) Decrease in compensated absences 1,003 Increase in OPEB liability (204,539) Depreciation and amortization(1,906,067) Total reconciling items(1,850,958) Change in net assets$503,526 92 SCHEDULE 10, Page 1 of 2 CITY OF MONROE, NORTH CAROLINA WATER AND SEWER CAPITAL PROJECTS FUND S CAPITAL RESERV E SCHEDULE OF REVENUES AND EXPENDITURES - - UDGET AND ACTUAL (NON-GAAP) B For the Fiscal Year Ended June 30, 2011 æÛÊÓÛÎÙ× ìÍÉÓÈÓÆ× úÇØÕ×ÈûÙÈÇÛÐî×ÕÛÈÓÆ× íèô÷êöóîûîùóîõéíçêù÷éçé÷é Transfers from other funds: Water and Sewer Capital Projects Funds-$ -$ -$ Increase in fund balance- - - Total other financing sources (uses)-$ - -$ Fund balance, beginning3,318,739 Fund balance, ending$3,318,739 93 SCHEDULE 10, Page 2 of 2 CITY OF MONROE, NORTH CAROLINA WATER AND SEWER CAPITAL PROJECTS FUND S CAPITAL PROJECTS SCHEDULE OF REVENUES AND EXPENDITURES - - UDGET AND ACTUAL (NON-GAAP) B From Inception and For the Fiscal Year Ended June 30, 2011 ûÙÈÇÛÐÛÊÛÎÙ× æÓ ìÊÍÒ×ÙÈìÊÓÍÊùÇÊÊ×ÎÈèÍÈÛÐÈÍìÍÉÓÈÓÆ× ûÇÈÔÍÊÓÂÛÈÓÍÎã×ÛÊÉã×ÛÊøÛÈ×î×ÕÛÈÓÆ× ê÷æ÷îç÷é Investment earnings-$ 180,738$ -$ 180,738$ 180,738$ ÷äì÷îøóèçê÷é Construction costs capitalized18,727,986 7,123,783 331,6487,455,431 11,272,555 Construction in progress15,069,082 332,794 132,139464,933 14,604,149 Other costs10,873,486 419,952 112,765 532,717 10,340,769 Total expenditures44,670,554 7,876,529 576,552 8,453,081 36,217,473 (7,695,791) (576,552) (8,272,343) 36,398,211 Revenues over (under) expenditures(44,670,554) íèô÷êöóîûîùóîõéíçêù÷éçé÷é Transfers from (to) other funds: Water and Sewer Fund4,491,262 5,649,500 (1,158,238) 4,491,262 - Water and Sewer Capital Reserve Fund50,000 50,000 - 50,000 - p,,, Bond issuance cost - (86,444)- (86,444) (86,444) Proceeds from refunding revenue bonds40,129,292 5,201,062 86,444 5,287,506 (34,841,786) 10,900,562 (1,158,238) 9,742,324 (34,928,230) Total other financing sources (uses)44,670,554 Revenues and other financing sources over (under) expenditures and other financing uses-$ 3,204,771$ (1,734,790)$ 1,469,981$ 1,469,981$ 94 SCHEDULE 11 CITY OF MONROE, NORTH CAROLINA LECTRIC FUND E SCHEDULE OF REVENUES AND EXPENDITURES -- UDGET AND ACTUAL (NON-GAAP) B For the Fiscal Year Ended June 30, 2011 æÛÊÓÛÎÙ× ìÍÉÓÈÓÆ× úÇØÕ×ÈûÙÈÇÛÐî×ÕÛÈÓÆ× ê÷æ÷îç÷é Operating revenues: Charges for services: Electric power sales46,765,738$ 47,197,888$ 432,150$ Sales tax1,042,453 932,285 (110,168) Total47,808,191 48,130,173 321,982 949,628 144,628 Other operating revenues805,000 49,079,801 466,610 Total operating revenues48,613,191 Nonoperating revenues: Other nonoperating revenues46,000 831,730 785,730 Investment earnings600,000 104,373 (495,627) 936,103 290,103 Total nonoperating revenues646,000 Total revenues49,259,191 50,015,904 756,713 íèô÷êöóîûîùóîõéíçêù÷é Transfers from other funds: General Fund10,00010,000- Repayment of advance from General Fund131,478131,477(1) Repayment of advance to Stormwater Fund 39,51839,517 1 Repayment of advance to Natural Gas Fund1,168,3561,060,272108,084 Repayment of advance from Airport Fund7,710,122 7,710,122 - Refunding revenue bonds issued2,004,607 2,004,607 - Premium on refunding revenue bonds issued109,156 109,156 - 11,065,151 108,084 Total other financing sources11,173,237 - 6,198,618 ûììêíìêóûèóíîèíöçîøúûðûîù÷(6,198,618) Total revenues and other financing sources$54,233,810 61,081,055$ 7,063,415$ - Continued - 95 SCHEDULE 11, Continued CITY OF MONROE, NORTH CAROLINA LECTRIC FUND E SCHEDULE OF REVENUES AND EXPENDITURES -- UDGET AND ACTUAL (NON-GAAP) B For the Fiscal Year Ended June 30, 2011 æÛÊÓÛÎÙ× ìÍÉÓÈÓÆ× úÇØÕ×ÈûÙÈÇÛÐî×ÕÛÈÓÆ× ÷äì÷îøóèçê÷é Operations: Salaries and employee benefits2,460,815$ 1,233,183$ 1,227,632$ Operating expenditures2,638,466 2,089,395 549,071 Total5,099,281 3,322,578 1,776,703 40,007,938 697,067 Electric power purchases40,705,005 Debt service: Principal retirement3,241,8343,174,232 67,602 Interest and other charges1,075,261 1,136,110 (60,849) 4,310,342 6,753 Total4,317,095 Capital outlay1,263,360 2,147,662 (884,302) Total expenditures51,384,741 49,788,520 1,596,221 íèô÷êöóîûîùóîõçé÷é Transfers to other funds Electric Capital Projects Funds2,801,387501,3862,300,001 Health and Dental Fund47,682 47,682 - Total other financing uses2,849,069 549,068 2,300,001 Total expenditures and other financing uses54,233,810$ 50,337,588$ 3,896,222$ - Continued - 96 SCHEDULE 11, Continued CITY OF MONROE, NORTH CAROLINA LECTRIC FUND E SCHEDULE OF REVENUES AND EXPENDITURES -- UDGET AND ACTUAL (NON-GAAP) B For the Fiscal Year Ended June 30, 2011 ê×ÙÍÎÙÓÐÓÛÈÓÍÎÖÊÍÏÚÇØÕ×ÈÛÊÃÚÛÉÓÉÏÍØÓÖÓ×ØÛÙÙÊÇÛÐÈÍÖÇÐÐÛÙÙÊÇÛÐ Total revenues and other financing sources61,081,055$ Total expenditures and other financing uses50,337,588 Revenues and other financing sources under expenditures and other financing uses10,743,467 Reconciling items: Debt principal 3,174,232 Amortization of deferred loss on refunding(16,808) Amortization of bond premimum 16,534 Amortization of bond issuance costs (17,306) Refunding revenue bonds issued(2,041,713) Premium on refunding revenue bonds issued(109,156) Bond issuance cost37,105 Deferred loss on refunding from issuance of revenue bonds30,945 Capital outlay 2,147,662 Net book value of assets disosed101,711 p(,) Netbookvalueofassetsdisposed(101711) Payments received on note receivable (648,940) Repayment of advance made to Airport Fund(7,558,943) Repayment of advance made to Natural Gas Fund(950,724) Repayment of advance made to Stormwater Fund(34,788) Repayment of advance made to General Fund(85,116) Transfer to Electric Capital Projects Funds501,386 Net revenue from capital projects consolidation2,653,116 Decrease in compensated absences 2,607 Increase in OPEB liability (90,533) Depreciation and amortization(2,280,997) Total reconciling items(5,373,148) Change in net assets$5,370,319 97 SCHEDULE 12 CITY OF MONROE, NORTH CAROLINA LECTRIC CAPITAL PROJECTS FUND ES CAPITAL PROJECTS SCHEDULE OF REVENUES AND EXPENDITURES - - UDGET AND ACTUAL (NON-GAAP) B From Inception and For the Fiscal Year Ended June 30, 2011 ûÙÈÇÛÐÛÊÛÎÙ× æÓ ìÊÍÒ×ÙÈìÊÓÍÊùÇÊÊ×ÎÈèÍÈÛÐÈÍìÍÉÓÈÓÆ× ûÇÈÔÍÊÓÂÛÈÓÍÎã×ÛÊÉã×ÛÊøÛÈ×î×ÕÛÈÓÆ× ê÷æ÷îç÷é Power agency funding5,805,850$ 5,592,648$ -$ 5,592,648$ (213,202)$ Miscellaneous - 6 - 6 6 Investment earnings- 466,064 - 466,064 466,064 5,805,850 6,058,718 - 6,058,718 252,868 ÷äì÷îøóèçê÷é Construction costs capitalized26,920,715 20,153,361 8,00920,161,370 6,759,345 Construction in progress22,008,346 10,154,407 3,559,21313,713,620 8,294,726 Other costs6,773,576 366,365 - 366,365 6,407,211 Total expenditures55,702,637 30,674,133 3,567,222 34,241,355 21,461,282 Revenues over (under) expenditures(49,896,787) (24,615,415) (3,567,222) (28,182,637) 21,714,150 íèô÷êöóîûîùóîõéíçêù÷é ransersrom oeruns: Transfersfromotherfunds: Tffthfd Electric Fund24,746,853 24,245,463 501,386 24,746,849 (4) Water and Sewer Fund469,933 - 469,933 469,933 - Natural Gas Fund 2,883,184 700,000 2,183,184 2,883,184 - Bond issuance cost- - (37,105) (37,105) (37,105) Proceeds from refunding revenue bonds21,796,817 21,741,775 37,105 21,778,880 (17,937) 49,896,78746,687,2383,154,50349,841,741(55,046) Revenues and other financing sources over expenditures-$ 22,071,823$ (412,719)$ 21,659,104$ 21,659,104$ 98 SCHEDULE 13 CITY OF MONROE, NORTH CAROLINA NATURAL GAS FUND SCHEDULE OF REVENUES AND EXPENDITURES -- UDGET AND ACTUAL (NON-GAAP) B For the Fiscal Year Ended June 30, 2011 æÛÊÓÛÎÙ× ìÍÉÓÈÓÆ× úÇØÕ×ÈûÙÈÇÛÐî×ÕÛÈÓÆ× ê÷æ÷îç÷é Operating revenues: Charges for services: Natural gas sales21,278,353$ 17,010,623$ (4,267,730)$ Other operating revenues- 10,524 10,524 Total operating revenues21,278,353 17,021,147 (4,257,206) Nonoperating revenues: Availability fees1,168,356 1,168,356 - Other nonoperating revenues- 16,036 16,036 65,503 (334,547) Investment earnings400,050 1,249,895 (318,511) Total nonoperating revenues1,568,406 Total revenues22,846,759 18,271,042 (4,575,717) íèô÷êöóîûîùóîõéíçêù÷é íèô÷êöóîûîùóîõéíçêù÷é Transfers from other funds General Fund208208 - Refunding revenue bonds issued 870,869 870,869 - Premium on refunding revenue bonds issued47,421 47,421 - 918,498 - Total other financing sources918,498 (5,275,507)- ûììêíìêóûèóíîèíöçîøúûðûîù÷5,275,507 $ (9,851,224)19,189,540$ Total revenues and other financing sources29,040,764$ - Continued - 99 SCHEDULE 13, Continued CITY OF MONROE, NORTH CAROLINA NATURAL GAS FUND SCHEDULE OF REVENUES AND EXPENDITURES -- UDGET AND ACTUAL (NON-GAAP) B For the Fiscal Year Ended June 30, 2011 æÛÊÓÛÎÙ× ìÍÉÓÈÓÆ× úÇØÕ×ÈûÙÈÇÛÐî×ÕÛÈÓÆ× ÷äì÷îøóèçê÷é Operations: Salaries and employee benefits844,939$ 549,567$ 295,372$ Operating expenditures2,176,938 1,703,458 473,480 Total3,021,877 2,253,025 768,852 8,510,245 4,689,755 Natural gas purchases13,200,000 Debt service: Principal retirement1,788,0421,767,338 20,704 Interest and other charges1,806,616 1,827,044 (20,428) Total3,594,658 3,594,382 276 738,381 (176,766) Capital outlay561,615 15,096,033 5,282,117 Total expenditures20,378,150 íèô÷êöóîûîùóîõçé÷é Transfers to other funds: Repayment of Advance from Electric Fund1,168,356 1,060,272 108,084 Health and Dental Fund22,958 22,958 - Electric Capital Project Fund2,183,183 2,183,184 (1) Natural Gas Capital Project Fund5,288,117 3,288,118 1,999,999 Total other financing uses8,662,614 6,554,532 2,108,082 Total expenditures and other financing uses29,040,764$ 21,650,565$ 7,390,199$ - Continued - 100 SCHEDULE 13, Continued CITY OF MONROE, NORTH CAROLINA NATURAL GAS FUND SCHEDULE OF REVENUES AND EXPENDITURES -- UDGET AND ACTUAL (NON-GAAP) B For the Fiscal Year Ended June 30, 2011 ê×ÙÍÎÙÓÐÓÛÈÓÍÎÖÊÍÏÚÇØÕ×ÈÛÊÃÚÛÉÓÉÏÍØÓÖÓ×ØÛÙÙÊÇÛÐÈÍÖÇÐÐÛÙÙÊÇÛÐ Total revenues and other financing sources19,189,540$ Total expenditures and other financing uses21,650,565 Revenues and other financing sources over expenditures and other financing uses(2,461,025) Reconciling items: Debt principal 1,767,338 Amortization of deferred loss on refunding (7,481) Amortization of bond discount 2,762 Amortization of bond premimum (11,548) Amortization of bond issuance costs (25,854) Refunding revenue bonds issued (886,989) Premium on refunding revenue bonds issued(47,421) Bond issuance cost 16,120 Deferred loss on refunding from issuance of revenue bonds13,444 Capital outlay 738,381 py, Repayment of advance from Electric Fund 950,724 Payment from outside party on note receivable(869,831) Transfer to Natural Gas Capital Projects Fund3,288,118 Net income from capital projects consolidation(167,059) Increase in compensated absences (2,820) Increase in OPEB liability (43,590) Depreciation and amortization(946,755) Total reconciling items3,767,539 Change in net assets$1,306,514 101 SCHEDULE 14 CITY OF MONROE, NORTH CAROLINA NATURAL GAS CAPITAL PROJECTS FUNDS CAPITAL PROJECTS SCHEDULE OF REVENUES AND EXPENDITURES -- UDGET AND ACTUAL (NON-GAAP) B From Inception and For the Fiscal Year Ended June 30, 2011 ûÙÈÇÛÐæÛÊÛÎÙ× Ó ìÊÍÒ×ÙÈìÊÓÍÊùÇÊÊ×ÎÈèÍÈÛÐÈÍìÍÉÓÈÓÆ× ûÇÈÔÍÊÓÂÛÈÓÍÎã×ÛÊÉã×ÛÊøÛÈ×î×ÕÛÈÓÆ× ê÷æ÷îç÷é Miscellaneous-$ 6,935$ 36$ 6,971$ 6,971$ Investment earnings- 160,033 - 160,033 160,033 Total revenues- 166,968 36 167,004 167,004 ÷äì÷îøóèçê÷é Construction costs capitalized48,484,213 41,364,805 1,406,91742,771,722 5,712,491 Construction in progress11,921,550 3,950,401 254,5094,204,910 7,716,640 Other costs428,705 416,113 - 416,113 12,592 Tota expentures,,5,7,,,7,,75,,7 ldi608344684313191661426439241344123 Revenues over (under) expenditures (45,564,351)(60,834,468) (1,661,390) (47,225,741) 13,608,727 íèô÷êöóîûîùóîõéíçêù÷éçé÷é Transfers from other funds: Natural Gas Fund22,201,117 16,913,000 3,288,118 20,201,118 (1,999,999) Electric Fund3,330,000 3,330,000 - 3,330,000 - Certificates of Participation31,628,998 31,628,998 - 31,628,998 - Bond issuance cost- - (16,120) (16,120) (16,120) Proceeds from refunding revenue bonds3,674,353 3,650,441 16,120 3,666,561 (7,792) Tota oternancng sources uses 55,5,,,,,5,,557,, lhfii()608344682243932881188810(2023911) Revenues and other financing sources over (under) expenditures-$ 9,958,088$ 1,626,728$ 11,584,816$ 11,584,816$ 102 SCHEDULE 15 CITY OF MONROE, NORTH CAROLINA AQUATICS AND FITNESS CENTER FUN D SCHEDULE OF REVENUES AND EXPENDITURES -- UDGET AND ACTUAL (NON-GAAP) B For the Fiscal Year Ended June 30, 2011 æÛÊÓÛÎÙ× ìÍÉÓÈÓÆ× ×ÈûÙÈÇÛî×ÛÈÓÆ× úÇØ ÕÐÕ ê÷æ÷îç÷é Operating revenues: Charges for services: Recreational fees3,708,000$ 3,787,318$ 79,318$ Other operating revenues148,000 139,863 (8,137) 3,927,181 71,181 Total operating revenues3,856,000 Nonoperating revenues: Other nonoperating revenues- - - Investment earnings37,000 7,794 (29,206) Total nonoperating revenues37,000 7,794 (29,206) Total revenues3,893,000 3,934,975 41,975 - 65,747 ûììêíìêóûèóíîèíöçîøúûðûîù÷(65,747) Total revenues$ 3,934,9753,827,253$ 107,722$ - Continued - 103 SCHEDULE 15, Continued CITY OF MONROE, NORTH CAROLINA AQUATICS AND FITNESS CENTER FUN D SCHEDULE OF REVENUES AND EXPENDITURES -- UDGET AND ACTUAL (NON-GAAP) B For the Fiscal Year Ended June 30, 2011 æÛÊÓÛÎÙ× ìÍÉÓÈÓÆ× úÇØÕ×ÈûÙÈÇÛÐî×ÕÛÈÓÆ× ÷äì÷îøóèçê÷é Operations: Salaries and employee benefits1,740,583$ 1,640,232$ 100,351$ Operating expenditures1,574,593 1,474,031 100,562 ota,,,,, Tl33151763114263200913 Debt service: Principal retirement424,370424,370- Interest and other charges48,281 48,281 - 472,651 - Total472,651 11,803 8,197 Capital outlay20,000 3,598,717 209,110 Total expenditures3,807,827 íèô÷êöóîûîùóîõçé÷é TftthfdTransfers to other funds: 19,426 - Health and Dental Fund19,426 19,426 - Total other financing uses19,426 3,618,143$ 209,110$ Total expenditures and other financing uses3,827,253$ - Continued - 104 SCHEDULE 15, Continued CITY OF MONROE, NORTH CAROLINA AQUATICS AND FITNESS CENTER FUN D SCHEDULE OF REVENUES AND EXPENDITURES -- UDGET AND ACTUAL (NON-GAAP) B For the Fiscal Year Ended June 30, 2011 ê×ÙÍÎÙÓÐÓÛÈÓÍÎÖÊÍÏÚÇØÕ×ÈÛÊÃÚÛÉÓÉÏÍØÓÖÓ×ØÛÙÙÊÇÛÐÈÍÖÇÐÐÛÙÙÊÇÛÐ Total revenues$ 3,934,975 Total expenditures and other financing uses3,618,143 Revenues over expenditures and other financing uses316,832 Reconciling items: Debt principal 424,370 Capital outlay 11,803 Increase in compensated absences (5,671) Increase in OPEB liability (77,121) Depreciation and amortization(268,950) Total reconciling items84,431 Change in net assets$401,263 105 SCHEDULE 16 CITY OF MONROE, NORTH CAROLINA AIRPORT FUND SCHEDULE OF REVENUES AND EXPENDITURES -- UDGET AND ACTUAL (NON-GAAP) B For the Fiscal Year Ended June 30, 2011 æÛÊÓÛÎÙ× ìÍÉÓÈÓÆ× úÇØÕ×ÈûÙÈÇÛÐî×ÕÛÈÓÆ× ê÷æ÷îç÷é Operating revenues: Charges for services: Leases262,340$ 298,152$ 35,812$ Flowage fee- - - Sales of fuel1,140,1591,319,287179,128 Total1,402,499 1,617,439 214,940 Other operating revenues30,100 35,839 5,739 Total operating revenues1,432,599 1,653,278 220,679 onoperatng revenues: Ni Investment earnings- 14,211 14,211 Total nonoperating revenues- 14,211 14,211 Totalrevenuesoa revenues1432599,,1667489,,234890, Ttl14325991667489234890 íèô÷êöóîûîùóîõéíçêù÷é Transfers from other funds: General Fund2,922,439 2,788,142 (134,297) Airport Capital Projects Fund6,143,922 6,143,922 - Refunding revenue bonds issued11,719,666 11,719,666 - Premium on refunding revenue bonds issued638,063 638,063 - Installment purchase obligations issued60,000 49,500 (10,500) Total other financing sources21,484,090 21,339,293 (144,797) ûììêíìêóûèóíîèíöçîøúûðûîù÷524,212 - (524,212) Total revenues and other financing sources23,440,901$ 23,006,782$ (434,119)$ - Continued - 106 SCHEDULE 16, Continued CITY OF MONROE, NORTH CAROLINA AIRPORT FUND SCHEDULE OF REVENUES AND EXPENDITURES -- UDGET AND ACTUAL (NON-GAAP) B For the Fiscal Year Ended June 30, 2011 æÛÊÓÛÎÙ× ÍÉÈÆ× ìÓÓ ÇÕ×ÈÙÈÇÛ×ÕÛÈÆ× úØûÐîÓ ÷äì÷îøóèçê÷é Operations: Salaries and employee benefits521,855$ 499,161$ 22,694$ Operating expenditures1,554,389 1,743,927 (189,538) Total2,076,244 2,243,088 (166,844) Debt service: Principal retirement12,965,47812,721,796243,682 Interest and other charges575,534 763,818 (188,284) Total13,541,012 13,485,614 55,398 Capital outlay99,395 83,730 15,665 Total expenditures15,716,651 15,812,432 (95,781) íèô÷êöóîûîùóîõçé÷é Transfers to other funds: Health and Dental Fund14,128 14,128 - Repayment of advance from Electric Fund7,710,122 7,710,122 - Total other financing sources7,724,250 7,724,250 - Total expenditures and other financing sources23,440,901$ 23,536,682$ (95,781)$ - Continued - 107 SCHEDULE 16, Continued CITY OF MONROE, NORTH CAROLINA AIRPORT FUND SCHEDULE OF REVENUES AND EXPENDITURES -- UDGET AND ACTUAL (NON-GAAP) B For the Fiscal Year Ended June 30, 2011 ê×ÙÍÎÙÓÐÓÛÈÓÍÎÖÊÍÏÚÇØÕ×ÈÛÊÃÚÛÉÓÉÏÍØÓÖÓ×ØÛÙÙÊÇÛÐÈÍÖÇÐÐÛÙÙÊÇÛÐ Total revenues and other financing sources23,006,782$ Total expenditures and other financing sources23,536,682 Revenues and other financing sources over expenditures and other financing uses(529,900) Reconciling items: Debt principal 12,721,796 Amortization of bond issuance costs (3,053) Repayment of advance from Electric Fund7,558,943 Capital outlay 83,730 Net book value of assets disposed (130,346) Refunding revenue bonds issued (11,934,724) Premium on refunding revenue bonds issued(638,063) Bond issuance cost of revenue bonds issued215,058 Installment purchase obligations issued (49,500) Netrevenuefromcapitalprojectsconsolidatione revenue rom capa proecs consoaon2152427,, Ntfitljtlidti2152427 Deferred loss on refunding from issuance of revenue bonds308,425 Transfer from Airport Capital Projects Fund(6,143,923) Decrease in compensated absences 666 Increase in OPEB liability (36,884) Depreciation and amortization(639,068) Total reconciling items3,465,484 Change in net assets$2,935,584 108 SCHEDULE 17 CITY OF MONROE, NORTH CAROLINA AIRPORT CAPITAL PROJECTS FUND S CAPITAL PROJECTS SCHEDULE OF REVENUES AND EXPENDITURES - - UDGET AND ACTUAL (NON-GAAP) B From Inception and For the Fiscal Year Ended June 30, 2011 ûÙÈÇÛæÛÊÓÛÎÙ Ð × ìÊÍÒ×ÙÈìÊÓÍÊùÇÊÊ×ÎÈèÍÈÛÐÈÍìÍÉÓÈÓÆ× ûÇÈÔÍÊÓÂÛÈÓÍÎã×ÛÊÉã×ÛÊøÛÈ×î×ÕÛÈÓÆ× ê÷æ÷îç÷é Restricted intergovernmental4,920,869$ 686,250$ $ 2,150,000$ 2,836,250$ (2,084,619) Investment earnings 407,419- 6,908 414,327 414,327 Total revenues4,920,869 1,093,669 2,156,908 3,250,577 (1,670,292) ÷äì÷îøóèçê÷é Construction costs capitalized8,774,560 6,150,849 1,030,282 7,181,131 1,593,429 Construction in progress 9,991,957 5,451,388 1,689,730 7,141,118 2,850,839 Other costs85,491 86,727 60,152 146,879 (61,388) Total expenditures18,852,008 11,688,964 2,780,164 14,469,128 4,382,880 Revenues over (under) expenditures (13,931,139) (10,595,295) (623,256) (11,218,551) 2,712,588 íèô÷êöóîûîùóîõéíçêù÷éçé÷é Transfers from (to) other funds: General Fund466,668 419,838 46,830 466,668 - Airport Fund 332,849 6,476,771 (6,143,923) 332,848 (1) Proceeds from refunding revenue bonds12,571,622 12,239,117 12,454,175215,058 (117,447) Bond issuance cost - (215,058)- (215,058) (215,058) Installment purchase obligations issued560,000 - - - (560,000) 19,135,726 (6,097,093) 13,038,633 (892,506) Total other financing sources (uses)13,931,139 Revenues and other financing sources over (under) expenditures and other financing uses-$ 8,540,431$ (6,720,349)$ 1,820,082$ 1,820,082$ 109 SCHEDULE 18 CITY OF MONROE, NORTH CAROLINA STORM WATER FUND SCHEDULE OF REVENUES AND EXPENDITURES - - UDGET AND ACTUAL (NON-GAAP) B For the Fiscal Year Ended June 30, 2011 æÛÊÓÛÎÙ× ìÍÉÓÈÓÆ× úÇØÕ×ÈûÙÈÇÛÐî×ÕÛÈÓÆ× ê÷æ÷îç÷é Operating revenues: Charges for services: Storm water receipts1,798,542$$1,793,744 (4,798)$ Total operating revenues1,798,542 1,793,744 (4,798) Nonoperating revenues: Other nonoperating revenues- 5 5 Investment earnings300 1,687 1,387 Total nonoperating revenues300 1,692 1,392 1,795,436 (3,406) Total revenues1,798,842 íèô÷êöóîûîùóîõéíçêù÷é 458,000 - Installment purchase obligations issued458,000 458,000 - Total other financing sources458,000 ûììêíìêóûèóíîèíöçîøúûðûîù÷91,724 - (91,724) Total revenues 2,348,566$ 2,253,436$ (95,130)$ - Continued - 110 SCHEDULE 18, Continued CITY OF MONROE, NORTH CAROLINA STORM WATER FUND SCHEDULE OF REVENUES AND EXPENDITURES - - UDGET AND ACTUAL (NON-GAAP) B For the Fiscal Year Ended June 30, 2011 æÛÊÓÛÎÙ× ìÍÉÓÈÓÆ× úÇØÕ×ÈûÙÈÇÛÐî×ÕÛÈÓÆ× ÷äì÷îøóèçê÷é Operations: Salaries and employee benefits626,623$ 567,147$ 59,476$ Reimbursements602,042 602,042 - Operating expenditures483,412 420,803 62,609 1,589,992 122,085 Total1,712,077 Debt service: Principal retirement32,311 33,340 (1,029) Interest and other charges10,000 8,986 1,014 Total42,311 42,326 (15) 5,224 531,776 Capital outlay537,000 Total expenditures2,291,388 1,637,542 653,846 íèô÷êöóîûîùóîõçé÷é Transfers to other funds: Health and Dental Fund17,660 17,660 - 39,517 (1) Repayment of advance from Electric Fund39,518 57,177 (1) Total other financing uses57,178 Total expenditures and other financing uses2,348,566$ 1,694,719$ 653,845$ - Continued - 111 SCHEDULE 18, Continued CITY OF MONROE, NORTH CAROLINA STORM WATER FUND SCHEDULE OF REVENUES AND EXPENDITURES - - UDGET AND ACTUAL (NON-GAAP) B For the Fiscal Year Ended June 30, 2011 ê×ÙÍÎÙÓÐÓÛÈÓÍÎÖÊÍÏÚÇØÕ×ÈÛÊÃÚÛÉÓÉÏÍØÓÖÓ×ØÛÙÙÊÇÛÐÈÍÖÇÐÐÛÙÙÊÇÛÐ Total revenues and other financing sources2,253,436$ Total expenditures and other financing uses1,694,719 Revenues and other financing sources over expenditures and other financing uses558,717 Reconciling items: Debt principal 33,340 Repayment of advance from Electric Fund39,517 Capital outlay 5,224 Installment purchase obligations issued(458,000) Increase in compensated absences (3,023) Increase in OPEB liability (33,531) Depreciation and amortization(60,326) Total reconciling items(476,799) Change in net assets$81,918 112 SCHEDULE 19 CITY OF MONROE, NORTH CAROLINA SOLID WASTE FUND SCHEDULE OF REVENUES AND EXPENDITURES -- UDGET AND ACTUAL (NON-GAAP) B For the Fiscal Year Ended June 30, 2011 æÛÊÓÛÎÙ× ìÍÉÓÈÓÆ× úÇØÕ×ÈûÙÈÇÛÐî×ÕÛÈÓÆ× ê÷æ÷îç÷é Operating revenues: Charges for services: $2,796,756 (932)$ Refuse collection fees2,797,688$ Total2,797,688 2,796,756 (932) Other operating revenues20,000 25,840 5,840 Total operating revenues2,817,688 2,822,596 4,908 Nonoperating revenues: Investment earnings6,000 2,288 (3,712) Total nonoperating revenues6,000 2,288 (3,712) Total revenues2,823,688 2,824,884 1,196 ûììêíìêóûèóíîèíöçîøúûðûîù÷ -(8,936) 8,936 Total revenues and other financing uses2,814,752$ 2,824,884$ 10,132$ - Continued - 113 SCHEDULE 19, Continued CITY OF MONROE, NORTH CAROLINA SOLID WASTE FUND SCHEDULE OF REVENUES AND EXPENDITURES -- UDGET AND ACTUAL (NON-GAAP) B For the Fiscal Year Ended June 30, 2011 æÛÊÓÛÎÙ× ìÍÉÓÈÓÆ× úÇØÕ×ÈûÙÈÇÛÐî×ÕÛÈÓÆ× ÷äì÷îøóèçê÷é Operations: Salaries and employee benefits7,070$ 7,086$ (16)$ Operating expenditures2,807,682 2,686,069 121,613 Total2,814,752 2,693,155 121,597 Total expenditures2,814,752$ 2,693,155$ 121,597$ - Continued - 114 SCHEDULE 19, Continued CITY OF MONROE, NORTH CAROLINA SOLID WASTE FUND SCHEDULE OF REVENUES AND EXPENDITURES -- UDGET AND ACTUAL (NON-GAAP) B For the Fiscal Year Ended June 30, 2011 ê×ÙÍÎÙÓÐÓÛÈÓÍÎÖÊÍÏÚÇØÕ×ÈÛÊÃÚÛÉÓÉÏÍØÓÖÓ×ØÛÙÙÊÇÛÐÈÍÖÇÐÐÛÙÙÊÇÛÐ Total revenues $ 2,824,884 Total expenditures 2,693,155 Revenues over expenditures131,729 Reconciling items: Increase in compensated absences (397) Increas in OPEB liability(3,353) Total reconciling items(3,750) Change in net assets$127,979 115 SCHEDULE 20 CITY OF MONROE, NORTH CAROLINA HEALTH AND DENTAL FUND SCHEDULE OF REVENUES AND EXPENDITURES (NON-GAAP) FOR THE YEAR ENDED JUNE 30, 2011 æÛÊÓÛÎÙ× öÛÆÍÊÛÚÐ× úÇØÕ×ÈûÙÈÇÛÐçÎÖÛÆÍÊÛÚÐ× ê÷æ÷îç÷é Operating revenues Interfund charges and employee contributions4,624,739$ 4,629,055$ 4,316$ Other operating revenue- 192,879 192,879 Total operating revenues4,624,739 4,821,934 197,195 Nonoperating revenues Investment earnings1,000 469 (531) Transfers from other funds1,300,000 1,300,000 - Total nonoperating revenues1,301,000 1,300,469 (531) Total revenues5,925,739 6,122,403 196,664 ÷äì÷îøóèçê÷é Operating expenditures Health care clinic97,000 66,880 30,120 Health benefit claims and premiums4,795,757 5,161,938 (366,181) Total operating expenditures4,892,757 5,228,818 (336,061) ûììêíìêóûèóíîèíöçîøúûðûîù÷ -1,032,982 1,032,982 Total expenditures5,925,739 5,228,818 696,921 Revenues over expenditures-$ 893,585$ 893,585$ 116 SCHEDULE 21 CITY OF MONROE, NORTH CAROLINA WORKERS' COMPENSATION FUND SCHEDULE OF REVENUES AND EXPENDITURES (NON-GAAP) FOR THE YEAR ENDED JUNE 30, 2011 æÛÊÓÛÎÙ× öÛÆÍÊÛÚÐ× úÇØÕ×ÈûÙÈÇÛÐçÎÖÛÆÍÊÛÚÐ× ê÷æ÷îç÷é Operating revenues Other operating revenue-$ 1,164$ 1,164$ Total operating revenues- 1,1641,164 Nonoperating revenues Investment earnings1,000 2,264 1,264 Appropriated fund balance800,000 - (800,000) Total nonoperating revenues801,000 2,264 (798,736) Total revenues801,000 3,428 (797,572) ÷äì÷îøóèçê÷é Operating expenditures Workers' compensation claims and premiums paid301,000 123,748 177,252 Total operating expenditures301,000 123,748 177,252 Nonoperating expenditures Transfers to other funds500,000 500,000 - Total nonoperating expenditures500,000 500,000 - Total expenditures801,000 623,748 177,252 Revenues under expenditures-$ (620,320)$ (620,320)$ 117 SCHEDULE 22 CITY OF MONROE, NORTH CAROLINA PROPERTY AND CASUALTY FUND SCHEDULE OF REVENUES AND EXPENDITURES (NON-GAAP) FOR THE YEAR ENDED JUNE 30, 2011 æÛÊÓÛÎÙ× öÛÆÍÊÛÚÐ× úÇØÕ×ÈûÙÈÇÛÐçÎÖÛÆÍÊÛÚÐ× ê÷æ÷îç÷é Operating revenues Interfund charges and employee contributions645,000$ 645,000$ -$ Other operating revenue- 3,521 3,521 Total operating revenues645,000 648,521 3,521 Nonoperating revenues Investment earnings100 336 236 Total nonoperating revenues100 336 236 Total revenues645,100 648,857 3,757 ÷äì÷îøóèçê÷é Operating expenditures Property and liability claims and premiums645,100 547,421 97,679 Total expenditures645,100 547,421 97,679 Revenues over expenditures-$ 101,436$ 101,436$ 118 SCHEDULE 23 CITY OF MONROE, NORTH CAROLINA SCHEDULE OF AD VALOREM TAXES RECEIVABL E une 30, 2011 J çÎÙÍÐÐ×ÙÈ×ØçÎÙÍÐÐ×ÙÈ×Ø úÛÐÛÎÙ×ùÍÐÐ×ÙÈÓÍÎÉúÛÐÛÎÙ× öÓÉÙÛÐã×ÛÊòÇÎ×  ûØØÓÈÓÍÎÉûÎØùÊ×ØÓÈÉòÇÎ×  2010 - 2011-$ 19,224,347$ 18,645,681$ 578,666$ 2009 - 2010580,326 - 319,579 260,747 2008 - 2009178,769 - 68,029 110,740 2007 - 2008115,232 - 23,068 92,164 2006 - 200780,992 - 31,583 49,409 2005 - 200628,388 - 2,822 25,566 2004 - 200520,753 - 827 19,926 2003 - 200415,804 - 193 15,611 2002 - 200318,283 - 128 18,155 2001 - 20028,648 - 32 8,616 2000 - 200116,109 - 16,109 - $ 19,224,3471,063,304$ 19,108,051$ Ad valorem taxes receivable$1,179,600 Municipal Service District - Downtown Reconcilement with revenues:General FunMonroe FundTotal d Ad valorem taxes - General fund$ 19,166,334$ 50,285$ 19,216,619 Amounts written off per statute of limitations 16,109 - 16,109 Refunds, releases of prior years' taxes 29,223 - 29,223 Interest and advertising cost recovery (538)(103,615) (104,153) Total collections and credits19,108,051$ 49,747$ 19,157,798$ 119 CHEDULE 24 S CITY OF MONROE, NORTH CAROLINA ANALYSIS OF CURRENT TAX LEVY CITY-WIDE LEVY For the Fiscal Year Ended June 30, 2011 èÍÈÛÐð×Æ Ã ìÊÍÌ×ÊÈà ×ÄÙÐÇØÓÎÕ ùÓÈÃåÓØ×Ê×ÕÓÉÈ×Ê×Øê×ÕÓÉÈ×Ê×Ø ìÊÍÌ×ÊÈÃèÍÈÛÐïÍÈÍÊïÍÈÍÊ æÛÐÇÛÈÓÍÎêÛÈ×ð×ÆÃæ×ÔÓÙÐ×Éæ×ÔÓÙÐ×É Original levy: Property taxed at current year's rate3,307,292,159$ 0.555 18,403,409$ 17,776,959$ 626,450$ Municipal Sevice District21,203,423 42,756 42,756 - 0 .200 Registered motor vehicles taxed at prior year's rate 413,36873,659,039 - 413,368 Total 3,402,154,621 18,859,533 17,819,715 1,039,818 Public Utility Allocation: City wide67,325,152 380,372 380,372 - 0 .555 Municipal Service District 1,892,410 3,785 3,785 - 0 .200 Discoveries City wide 12,283,845 68,541 54,989 13,552 0 .555 Municipal Service District- - - - 0 .200 Abatements City wide (17,920,460) (87,877) (45,022) (42,855) 0 .555 Municipal Service District 0.200(4,080) (8) (8) - Total property valuation3,465,731,488$ Net levy 19,224,346 18,213,831 1,010,515 Uncollected taxes at June 30, 2011(578,666) (441,626) (137,040) Current year's taxes collected18,645,680$ 17,772,205$ 873,475$ Current levy collection percentage96.99%97.58%86.44% Secondary Market Disclosures: Propert y Valuation RateLevy Assessed Valuation: 1 Assessment Ratio 100% Real property$2,402,580,432 Personal property 777,420,237 2 Public Service Companies 67,325,152 3,247,325,821 0 .55518,167,298 Municpal Service District Real property 19,704,750 Personal property 1,494,593 2 Public Service Companies 1,892,410 23,091,753 46,533 0 .200 Motor Vehicle Property 121,654,875 597,147 0 .555 Motor Vehicle Property 0.49573,659,039 413,368 3 Total levy (includes discoveries, releases and abatements) $ 19,224,3463,465,731,488$ Distribution of levy: General Fund$ 19,177,813 Municipal Service District - Downtown Monroe Fun46,533 d $19,224,346 1 Percentage of appraised value has been established by statute. 2 Valuation of railroads, telephone companies and other utilities as determined by the North Carolina Property Tax Commission. 3 The levy includes interest and penalties. 120 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...... 123 Revenue Capacity — These tables contain information to help the reader assess the City's most significant local revenue source, the property tax..... 128 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 the future..... 132 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..... 137 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.......... 139 ........................ . Sources: Unless otherwise noted, the information in these tables is derived from the comprehensive annual financial reports to the relevant year. CITY OF .�IONROE a heritage of progress Governmental activities Invested in capital assets, net of related debt Restricted Unrestricted Total governmental activities net assets Business -type activities Invested in capital assets, net of related debt Unrestricted Total business -type activities net assets Primary government Invested in capital assets, net of related debt Restricted Unrestricted Total primary government net assets CITY OFMONROE, NORTH CAROLINA NET ASSETS BY COMPONENT LAST TEN FISCAL YEARS (accrual basis of accounting) (in thousands of dollars) TABLE I 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 $ $ 72,069 $ 73,696 $ 74,193 $ 73,177 $ 71,568 $ 73,467 $ 74,438 $ 73,296 $ 71,692 629 538 624 239 144 45 2 255 670 17,884 19,638 19,717 18,683 20,924 20,718 20,739 20,359 20,979 $ $ 90,582 $ 93,872 $ 94,534 $ 92,099 $ 92,636 $ 94,229 $ 95,179 $ 93,910 $ 93,341 $ $ 84,905 $ 92,356 $ 101,382 $ 109,561 $ 118,219 $ 127,957 $ 127,104 $ 141,269 $ 144,182 62,267 62,274 63,956 68,479 77,350 84,078 91,595 86,319 94,053 $ $ 147,172 $ 154,630 $ 165,338 $ 178,040 $ 195,569 $ 212,035 $ 218,699 $ 227,588 $ 238,235 $ $ 156,974 $ 166,052 $ 175,575 $ 182,738 $ 189,787 $ 201,424 $ 201,542 $ 214,565 $ 215,874 629 538 624 239 144 45 2 255 670 80,151 81,912 83,673 87,162 98,274 104,796 112,334 106,678 115,032 $ $ 237,754 $ 248,502 $ 259,872 $ 270,139 $ 288,205 $ 306,264 $ 313,878 $ 321,498 $ 331,576 Note: Data for fiscal year 2002 not available. These periods were prior to the implementation of GASB Statement 34. 123 EXPENSES Governmental activities: General government Transportation Public safety Environmental protection Culture and recreation Economic and physical development Interest on long -term debt Total governmental activities expenses Business -type activities: Water and sewer Electric Natural gas Aquatics and Fitness Center Stormwater Solid Waste Airport Total business -type activities expenses Total primary government expenses PROGRAM REVENUES Governmental activities: Charges for services: General government Transportation Public safety Environmental protection Culture and recreation Economic and physical development Operating grants and contributions: General government Transportation Public safety Environmental protection Culture and recreation Economic and physical development Capital grants and contributions: Transportation Public safety Culture and recreation Total governmental activities program revenues TABLE 2 CITY OF MONROE, NORTH CAROLINA CHANGES INNETASSETS LAST TEN FISCAL YEARS (accrual basis of'accountinp) (in thousands of'dollars) 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 $ $ 4,216 $ 4,243 $ 4,133 $ 4,600 $ 4,176 $ 4,945 $ 4,725 S 4,952 $ 5,294 3,652 4,409 4,119 4,482 4,444 4,966 5,441 5,667 4,699 9,156 10,291 10,776 12,069 13,557 14,247 17,974 17,775 18,224 1,854 1,894 1,903 2,007 2,349 2,551 - - - 3,307 3,462 3,197 3,483 3,802 3,922 4,914 4,906 4,545 357 791 898 1,404 2,140 948 859 1,784 1,119 212 232 158 187 205 238 312 161 107 22,754 25,322 25,184 28,232 30,673 31,817 34,225 35,245 33,988 8,388 9,202 8,826 8,525 8,907 11,381 11,543 11,520 11,955 31,120 32,369 33,990 35,491 37,042 39,703 41,629 43,588 46,840 14,867 20,171 19,305 20,791 16,037 16,942 16,867 17,585 13,913 1,806 2,335 2,779 2,881 2,934 3,187 3,725 3,436 3,549 - - - - - - 795 1,351 1,709 - - - - - - 2,698 2,702 2,697 489 595 596 1,272 2,187 2,865 3,232 3,498 3,553 56,670 64,672 65,496 68,960 67,107 74,077 80,489 83,680 84,216 S S 79,424 S 89,994 S 90,680 S 97,192 S 97,780 S 105,894 S 114,714 S 118,925 S 118,204 S S 887 S 864 S 1,118 S 1,279 S 1,261 S 1,132 S 2,029 S 1,979 S 1,955 - - - - - - 243 236 202 38 78 84 96 65 51 2,065 2,213 2,312 1,742 1,855 1,914 2,062 2,761 2,795 43 - - 710 747 708 761 814 844 1,239 1,194 1,232 7 12 8 4 13 3 2 8 3 20 314 32 69 85 8 - - - 872 872 986 998 1,004 1,154 1,082 986 1,032 508 270 206 246 897 1,017 604 732 616 - 26 2 4 2 2 1 - - 5 124 172 243 197 216 223 195 204 148 210 236 93 83 7 194 326 135 10,207 3,488 1,147 647 45 2,435 3,460 1,187 - - - - - - - - - 49 - - - - - - - 785 304 15,144 8,860 124 6,613 6,502 7,227 9,665 11,184 9,841 8,044 Business -type activities: Charge for services: Water and sewer 10,362 10,434 11,180 12,080 13,303 12,705 12,207 12,365 12,917 Electric 33,926 34,513 35,993 39,118 39,854 43,051 40,926 43,089 48,454 Natural gas 17,056 21,940 21,064 22,683 18,163 18,836 20,116 24,251 17,320 Aquatics and Fitness Center 2,661 2,990 3,336 3,734 4,057 4,162 4,069 3,907 3,927 Stormwater - - - - - - 822 1,776 1,794 Solid Waste - - - - - - 2,748 2,839 2,822 Airport 138 178 255 676 1,398 1,897 1,559 1,493 1,653 Operating grants and contributions: Water and sewer - - 8 - - - - - - - Capital grants and contributions: Water and sewer 882 1,234 1,004 2,451 2,918 527 Stormwater - - - - - - - 109 - - Airport 1,852 584 681 324 903 154 483 2,150 Total business -type activities program revenues 65,995 71,529 73,743 79,619 80,129 83,569 83,236 90,203 91,037 Total primary government revenues $ $ 81,139 $ 80,389 $ 80,356 $ 86,121 $ 87,356 $ 93,234 $ 94,421 $ 100,044 $ 99,081 NET(EXPENSE)REVENUE Governmental activities $ $ (7,610) $ (16,462) $ (18,571) $ (21,730) $ (23,446) $ (22,152) $ (23,041) $ (25,404) $ (25,944) Business -type activities 9,325 6,857 8,247 10,659 13,022 9,492 2,748 6,523 6,821 Total primary government net (expense) revenue $ $ 1,715 $ (9,605) $ (10,324) $ (11,071) $ (10,424) $ (12,660) $ (20,293) $ (18,881) $ (19,123) GENERAL REVENUES AND OTHER CHANGES IN NET ASSETS Governmental activities: Taxes: Property taxes, levied for general purpose $ $ 10,478 $ 10,967 $ 11,577 $ 12,107 $ 13,851 $ 15,304 $ 16,286 $ 16,954 $ 19,314 Local option sales tax - - 4,672 4,406 4,958 4,884 4,096 3,537 3,906 Utility taxes - - 1,199 1,299 1,364 1,430 1,364 1,432 1,543 Othertaxes 6,067 7,302 1,449 1,610 1,790 1,878 1,931 1,745 2,212 Grants and contributions not restricted to specific programs 127 130 127 127 202 251 225 242 218 Unrestricted investment earnings 671 41 553 381 1,141 1,259 495 273 65 Miscellaneous 367 325 327 301 441 476 520 565 726 Gain on sale of capital assets - 964 72 99 - 199 (19) 96 11 Transfers (789) (383) (745) (1,035) 237 (442) (908) (710) (2,619) Total governmental activities 16,921 19,346 19,231 19,295 23,985 25,239 23,990 24,134 25,376 Business -type activities: Grants and contributions not restricted to specific programs - - - 1,632 - - - - - - Unrestricted investment earnings 2,256 54 84 862 3,465 4,853 2,992 971 289 Miscellaneous (4) 179 - 150 65 60 63 395 858 Gain on sale of capital assets - (17) - (5) 1,214 1 (47) 291 60 Transfers 789 383 744 1,035 (237) 442 908 710 2,619 Total business -type activities 3,041 599 2,460 2,042 4,508 5,356 3,916 2,367 3,826 Total primary government $ $ 19,962 $ 19,945 $ 21,691 $ 21,337 $ 28,492 $ 30,596 $ 27,906 $ 26,501 $ 29,202 CHANGE IN NET ASSETS Governmental activities $ $ 9,311 $ 2,884 $ 660 $ (2,435) $ 539 $ 3,087 $ 950 $ (1,270) $ (568) Business -type activities 12,366 7,456 10,707 12,701 17,529 14,848 6,664 8,890 10,647 Total primary government $ $ 21,677 $ 10,340 $ 11,367 $ 10,266 $ 18,069 $ 17,935 $ 7,614 $ 7,620 $ 10,079 Notes: Data for fiscal year 2002 not available. These periods were prior to the implementation of GASB Statement 34. Solid Waste and Stormwater funds were established in 2009. Previously, these expenditures were included in the General Fund. Internal service funds were established in 2009. Per GASB, revenues for these funds are allocated between business type and governmental type activities. 125 General Fund Reserved Unreserved Nonspendable Restricted Assigned Unassigned Total General Fund All Other Governmental Funds Reserved Unreserved, reported in: Special Revenue Funds Capital Projects Funds Restricted Assigned Total all other governmental funds CITY OF MONROE, NORTH CAROLINA TABLE 3 FUND BALANCES, GOVERNMENTAL FUNDS LAST TEN FISCAL YEARS (modified accrual basis of'accounting) (m thousands of'dollars) FISCAL YEAR 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 $ 6,346 $ 4,463 $ 4,963 $ 5,601 $ 5,590 $ 4,251 $ 4,972 $ 4,058 $ 4,012 $ 4,462 10,502 13,186 14,668 13,375 12,582 13,803 15,635 13,808 15,614 16,017 $ 331 4,130 $ 2,097 $ 1,943 $ 1,663 $ 2,233 $ 1,795 $ 3,866 $ 2,600 $ 5,021 $ 1,728 2,975 13,042 $ 16,848 $ 17,649 $ 19,631 $ 18,976 $ 18,172 $ 18,054 $ 20,607 $ 17,866 $ 19,626 $ 20,478 $ 897 $ 801 $ 1,217 $ 825 $ 286 $ 430 $ 3 $ 93 $ 233 $ 6 297 323 201 307 433 1,552 1,418 1,600 1,609 53 903 819 245 1,101 1,076 1,884 1,179 3,328 (114) 1,221 $ 6 1,275 $ 2,097 $ 1,943 $ 1,663 $ 2,233 $ 1,795 $ 3,866 $ 2,600 $ 5,021 $ 1,728 $ 1,281 Notes: Fiscal year 2011 reflects implementation of GASB Statement 54. Prior year amounts have not been restated. The classification of fund balance amounts in 2011 is discussed in the notes to the financial statements section I.E.12. iK CITY OF MONROE, NORTH CAROLINA CHANGES IN FUND BALANCES, GOVERNMENTAL FUNDS LAST TEN FISCAL YEARS (modified accrual basis of accounting) (in thousands of dollars) TABLE 4 OTHER FINANCING SOURCES (USES) Transfers from (to) others (714) (789) (383) (745) FISCAL YEAR 237 (573) (3,430) (710) (3,419) 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 REVENUES Installment purchase obligations issued 727 1,578 3,142 2,492 1,713 945 3,317 3,661 475 Ad valorem taxes $ 10,235 $ 10,640 $ 11,043 $ 11,578 $ 12,049 $ 13,655 $ 15,265 $ 16,134 $ 16,909 $ 19,217 Other taxes and licenses 3,996 4,510 5,643 912 1,040 1,044 1,227 1,220 874 1,249 Unrestricted intergovernmental 761 1,672 1,749 6,490 6,332 7,176 7,177 6,360 6,044 6,586 Restricted intergovernmental 1,084 1,688 2,279 2,505 2,240 2,195 2,378 2,826 3,274 2,399 Program income 63 12 41 10 6 84 6 2 7 2 Sales and services (1) 3,443 3,334 4,513 3,742 4,292 5,012 5,137 1,961 1,740 1,708 Investment earnings 790 671 24 553 381 1,141 1,259 495 273 64 Miscellaneous 586 451 498 563 396 522 650 611 548 747 Total revenues 20,958 22,978 25,790 26,353 26,736 30,829 33,099 29,609 29,669 31,972 EXPENDITURES General government 2,707 3,791 3,967 4,207 4,273 3,801 4,578 4,086 4,170 3,410 Transportation 1,422 1,698 1,984 1,858 2,144 2,162 2,426 2,452 1,727 1,484 Public safety 8,025 8,483 9,939 9,957 10,996 12,593 13,304 13,864 14,385 14,332 Environmental protection (1) 1,847 1,732 1,761 1,784 1,896 2,349 2,551 - - - Culture and recreation 3,134 3,064 2,827 2,924 3,037 3,426 3,536 3,902 3,554 3,894 Economic and physical development 169 344 792 610 585 1,460 830 986 1,909 2,045 Capital outlay 4,440 2,682 2,992 5,131 3,878 2,446 5,487 2,619 2,832 1,091 Debt service: Principal retirement 1,148 1,116 2,761 1,555 1,659 1,617 1,660 1,828 1,922 1,962 Interest and other charges 205 212 232 158 187 205 182 310 337 61 Total expenditures 23,097 23,122 27,255 28,184 28,655 30,059 34,554 30,047 30,836 28,279 Excess (deficiency) of revenues over (under) expenditures (2,139) (144) (1,465) (1,831) (1,919) 770 (1,456) (438) (1,167) 3,693 OTHER FINANCING SOURCES (USES) Transfers from (to) others (714) (789) (383) (745) (1,035) 237 (573) (3,430) (710) (3,419) Repayment of advance from other funds (131) (131) Installment purchase obligations issued 727 1,578 3,142 2,492 1,713 945 3,317 3,661 475 263 Total other financing sources (uses) 13 789 2,759 1,747 678 1,182 2,744 231 (366) (3,287) Net change in fund balances $ (2,126) $ 645 $ 1,294 $ (84) $ (1,241) $ 1,952 $ 1,288 $ (207) $ (1,533) $ 406 Debt service as a percentage of noncapital expenditures 7.25% 6.50% 12.34% 7.43% 7.45% 6.60% 6.34% 7.79% 8.07% 7.44% Note: (1) The Solid Waste Fund was established in 2009. Previously, these revenues and expenditures were included in the General Fund. 127 CITY OFMONROE, NORTH CAROLINA ASSESSED VALUEAND ACTUAL VALUE OF TAXABLE PROPERTY LAST TEN FISCAL YEARS (in thousands of'dollars) Fiscal Real Personal Year Property Property 2002 $ 1,332,315 $ 449,127 $ 2003 1,388,118 460,214 2004 1,490,483 451,967 2005 1,691,376 444,329 2006 1,697,294 459,106 2007 1,779,327 521,941 2008 1,878,050 583,078 2009 2,346,529 659,913 2010 2,386,289 765,537 2011 2,429,534 777,420 Notes: (1) Property is assessed at actual value; therefore, the assessed value is equal to actual value. Tax Rates are per $100 of assessed value. Sources: Union County Tax Assessor's Office and North Carolina Property Tax Commission. 128 Public Motor Service Vehicle Companies 188,341 $ 44,021 $ 193,463 43,444 170,653 41,854 198,995 41,408 238,446 43,934 226,844 43,261 227,535 49,984 207,793 49,487 186,439 60,724 189,559 69,218 Notes: (1) Property is assessed at actual value; therefore, the assessed value is equal to actual value. Tax Rates are per $100 of assessed value. Sources: Union County Tax Assessor's Office and North Carolina Property Tax Commission. 128 TABLE 5 Total Total Direct Assessed Tax Rate Value (1) 2,013,804 $ 0.500 2,085,239 0.500 2,154,957 0.500 2,376,108 0.480 2,438,780 0.490 2,571,373 0.530 2,738,647 0.550 3,263,722 0.495 3,398,989 0.495 3,465,731 0.555 TABLE 5 CITY OFMONROE, NORTH CAROLINA DIRECT AND OVERLAPPING PROPERTY TAX RATES LAST TEN YEARS (rate per SI00 of assessed value) Notes: (1) Total City tax rate is a weighted average of all types of City of Monroe tax rates. Union County rate is a direct rate. Source: Union County, Tax Assessment Division 129 TABLE 6 City of Monroe Overlapping Rates Total General Municipal Total Union Monroe Direct and Fiscal Fund Service District Weighted County School Overlapping Year Basic Rate Basic Rate Average Rate(i) Basic Rate District Rates 2002 $ 0.5000 $ 0.2000 $ 0.5014 $ 0.4705 $ 0.0700 $ 1.0419 2003 0.5000 0.2000 0.5034 0.4705 0.0700 1.0439 2004 0.5000 0.2000 0.5042 0.5300 0.0700 1.1042 2005 0.4800 0.2000 0.4794 0.5250 0.0700 1.0744 2006 0.4900 0.2000 0.4938 0.5600 0.0700 1.1238 2007 0.5300 0.2000 0.5338 0.6367 - 1.1705 2008 0.5500 0.2000 0.5491 0.7111 1.2602 2009 0.4950 0.2000 0.4955 0.6650 1.1605 2010 0.4950 0.2000 0.4964 0.6650 1.1614 2011 0.5550 0.2000 0.5547 0.6650 1.2197 Notes: (1) Total City tax rate is a weighted average of all types of City of Monroe tax rates. Union County rate is a direct rate. Source: Union County, Tax Assessment Division 129 TABLE 6 CITY OFMONROE, NORTH CAROLINA PRINCIPAL PROPERTY TAXPAYERS CURRENT YEAR AND NINE YEARS AGO (in thousands of'dollars) Source: City of Monroe Tax System 130 TABLE 7 2002 2011 Percentage Percentage of of Total Total Taxable Taxable Taxable Taxable Assessed Assessed Assessed Assessed Taxpayer Value Rank Value Value Rank Value Allegheny Technologies (Allvac) $ 60,468 2 2.9% $ 306,725 1 8.9% Charlotte Pipe & Foundry Co. 104,756 1 5.2% 107,378 2 3.1% Turbomeca - - 45,457 3 1.3% Tyson Farms, Inc. (Tyson Foods, Inc.) 37,242 3 1.8% 41,533 4 1.2% Consolidated Metco, Inc. 28,355 4 1.4% 29,984 5 0.9% Inland American Monroe Poplin - - 27,788 6 0.8% Yale Security (Assa Abloy - Door Security) 17,932 6 0.9% 25,126 7 0.7% Greiner Bio -One - - 19,421 8 0.6% Scott Technologies - - 18,422 9 0.5% Monroe Mall (Madison) 18,267 5 0.9% 18,455 10 0.5% Square D Company 14,375 8 0.7% - - Goulston Technologies 13,616 9 0.7% Cooper Industries 17,717 7 0.9% Westdale Insterstate Properties 13,509 10 0.7% - - Total $ 326,238 16.2% $ 640,289 18.5% Source: City of Monroe Tax System 130 TABLE 7 Fiscal Year 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 Taxes Levied for the Fiscal Year $ 9,774 $ 10,236 10,682 10,869 11,959 13,429 14,647 16,100 16,490 18,859 Source: City of Monroe Tax System CITY OFMONROE, NORTH CAROLINA PROPERTY TAX LEVIES AND COLLECTIONS LAST TEN FISCAL YEARS (in thousands of'dollars) TABLE 8 131 Collected within the Taxes Fiscal Year of Total Collections to Date Public Levied for the the Levy Collections in Percentage Utility Fiscal Year Percentage Subsequent of Adjusted Allocation Discoveries Abatements (Adjusted) Amount ofLevy Years Amount Levy 220 $ 214 $ 51 $ 10,157 $ 9,833 96.81% $ 315 $ 10,148 99.91% 217 79 82 10,450 10,117 96.82 315 10,432 99.83 209 107 90 10,908 10,644 97.58 248 10,892 99.85 199 472 106 11,434 11,178 97.77 236 11,414 99.83 215 17 100 12,091 11,754 97.22 311 12,065 99.78 229 407 137 13,928 13,290 96.45 589 13,879 99.65 275 278 107 15,093 14,607 96.78 394 15,001 99.39 245 45 159 16,231 15,669 96.54 451 16,120 99.32 300 160 78 16,872 16,292 96.56 319 16,611 98.45 384 69 88 19,224 18,646 96.99 - 18,646 96.99 131 CITY OFMONROE, NORTH CAROLINA RATIOS OF OUTSTANDING DEBT BY TYPE LAST TEN FISCAL YEARS (dollars in thousands, except per capita) Notes: Details regarding the City's outstanding debt can be found in the notes to the financial statements. (1) See Table 14 for personal income and population data. These ratios are calculated using personal income and population for prior calendar year. Calendar year 2009 and 2010 personal income not available to calculate fiscal year 2010 and 2011. (2) Personal income not available for 2010 and 2011. 132 TABLE 9 Governmental Percentage of Total Activities Personal Business -type Activities Capita Income Installment General (1) State Installment Fiscal Purchase Obligation Revenue Revolving Purchase Year Obligations Bonds Bonds Loans Obligations 2002 $ 4,997 $ 4,985 $ 12,960 $ 10,894 $ 5,843 2003 5,459 4,250 12,495 10,067 5,624 2004 5,840 3,525 12,000 9,240 8,033 2005 6,777 2,815 11,485 8,413 7,453 2006 6,832 2,125 10,950 7,586 6,793 2007 6,150 1,450 10,385 6,759 5,770 2008 7,821 790 53,810 5,932 5,061 2009 9,656 140 53,185 5,105 36,011 2010 (2) 8,209 - 51,320 4,278 36,291 2011 (2) 6,736 48,980 3,451 35,134 Notes: Details regarding the City's outstanding debt can be found in the notes to the financial statements. (1) See Table 14 for personal income and population data. These ratios are calculated using personal income and population for prior calendar year. Calendar year 2009 and 2010 personal income not available to calculate fiscal year 2010 and 2011. (2) Personal income not available for 2010 and 2011. 132 TABLE 9 Percentage of Total Per Personal Primary Capita Income Government (1) (1) $ 39,679 $ 1,430 1.04% 37,895 1,284 0.94 38,638 1,271 0.88 36,943 1,183 0.74 34,286 1,056 0.61 30,514 900 0.49 73,414 2,041 1.13 104,097 2,792 1.58 100,098 2,626 - 94,301 2,857 CITY OFMONROE, NORTH CAROLINA RATIOS OF GENERAL BONDED DEBT OUTSTANDING LAST TEN FISCAL YEARS (dollars in thousands, except per capita) Notes : Details regarding the City's outstanding debt can be found in the notes to the financial statements. (1) See Table 14 for population data. (2) See Table 5 for total assessed value of property. 133 TABLE 10 Percentage of Actual General Taxable Value Per Fiscal Obligation of Property Capita Year Bonds (2) (1) 2002 $ 4,985 0.25% $ 180 2003 4,250 0.20 144 2004 3,525 0.16 116 2005 2,815 0.12 90 2006 2,125 0.09 65 2007 1,450 0.06 43 2008 790 0.03 22 2009 140 0.004 4 2010 - N/A N/A 2011 N/A N/A Notes : Details regarding the City's outstanding debt can be found in the notes to the financial statements. (1) See Table 14 for population data. (2) See Table 5 for total assessed value of property. 133 TABLE 10 CITY OF MONROE, NORTH CAROLINA DIRECT AND OVERLAPPING GOVERNMENTAL ACTIVITIES DEBT ASOFJUNE30, 2011 (in thousands oJ'dollars) Governmental Unit Union County, overlapping debt Total direct debt Total direct and overlapping debt 100% $ 450,285 $ 67,543 Notes: (1) Includes general obligation debt only. (2) Determined by ratio of assessed value of property subject to taxation in Union County ($23,131,707,917) and City of Monroe ($3,465,731,488). Source: Union County Finance Department 134 TABLE M Estimated Estimated Share of Debt Percentage Direct and Outstanding Applicable Overlapping (1) (2) Debt $ 450,285 15.0% $ 67,543 100% $ 450,285 $ 67,543 Notes: (1) Includes general obligation debt only. (2) Determined by ratio of assessed value of property subject to taxation in Union County ($23,131,707,917) and City of Monroe ($3,465,731,488). Source: Union County Finance Department 134 TABLE M Assessed value Debt limit (8% of total assessed value) Bonded debt Debt not evidenced by bonds Gross debt Less: deductions allowed by North Carolina General Statutes: Bonded debt incurred for water purposes Bonded debt incurred for sewer purposes Total deductions Net debt applicable to limit Legal debt margin Note: NC Statute GS 159 -55 limits the City's debt to 8% of the appraised value of property subject to taxation. The following deductions are made from gross to arrive at net debt applicable to the limit: money held for payment of principal; debt incurred for water, sewer, gas, or electric purposes; uncollected special assessments, funding and refunding bonds not yet issued; and revenue bonds. The legal debt margin is the difference between the debt limit and the City's net debt outstanding applicable to the limit, and represents the City's legal borrowing authority. 135 41,871 $ 41,871 $3,465,731 277,258 41,871 $ 235,387 TABLE 12 CITY OF MONROE, NORTH CAROLINA LEGAL DEBT MARGIN INFORMATION LAST TEN FISCAL YEARS fn thousands of dollars) FISCAL YEAR 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 Debt limit (8% of assessed value) $ 161,380 $ 165,377 $ 172,397 $ 190,088 $ 195,102 $ 205,710 $ 219,092 $ 261,098 $ 271,919 $ 277,258 Total net debt applicable to limit 10,841 11,083 13,874 14,229 13,624 11,920 12,882 46,667 44,500 41,871 Legal debt margin $ 150,539 $ 154,294 $ 158,523 $ 175,859 $ 181,478 $ 193,790 $ 206,210 $ 214,431 $ 227,419 $ 235,387 Total net debt applicable to the limit as a percentage of debt limit 6.72% 6.70% 8.05% 7.49% 6.98% 5.79% 5.88% 17.87% 16.37% 15.10% Legal Debt Margin Calculation for Fiscal Year 2011 Assessed value Debt limit (8% of total assessed value) Bonded debt Debt not evidenced by bonds Gross debt Less: deductions allowed by North Carolina General Statutes: Bonded debt incurred for water purposes Bonded debt incurred for sewer purposes Total deductions Net debt applicable to limit Legal debt margin Note: NC Statute GS 159 -55 limits the City's debt to 8% of the appraised value of property subject to taxation. The following deductions are made from gross to arrive at net debt applicable to the limit: money held for payment of principal; debt incurred for water, sewer, gas, or electric purposes; uncollected special assessments, funding and refunding bonds not yet issued; and revenue bonds. The legal debt margin is the difference between the debt limit and the City's net debt outstanding applicable to the limit, and represents the City's legal borrowing authority. 135 41,871 $ 41,871 $3,465,731 277,258 41,871 $ 235,387 CITY OFMONROE, NORTH CAROLINA PLEDGED - REVENUE COVERAGE LAST TENFISCAL YEARS (in thousands of'dollars) Notes: Details regarding the City's outstanding debt can be found in the notes to the financial statements. (1) Per rate covenants, this does not include the annual depreciation expense. (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. 136 TABLE 13 Less Income Operating Nonoperating Available for Debt Service Fiscal Operating Expenses Operating Revenues Debt (3) Year Revenues (1) Income (2) Service Principal Interest Coverage 2002 $ 56,257 $ 49,069 $ 7,188 $ 1,972 $ 9,160 $ 1,195 $ 838 451 2003 61,482 52,302 9,180 2,212 11,392 1,200 791 572 2004 67,065 59,705 7,360 52 7,412 1,220 743 378 2005 68,492 60,408 8,084 1,585 9,669 1,225 692 504 2006 74,557 63,809 10,748 834 11,582 1,225 641 621 2007 72,718 61,629 11,088 3,343 14,431 1,240 588 789 2008 76,489 67,113 9,376 4,683 14,059 1,250 815 681 2009 74,807 66,727 8,081 2,884 10,964 1,275 2,456 294 2010 75,197 67,175 8,022 939 8,961 2,005 2,399 203 2011 80,045 66,284 13,761 277 14,038 2,772 2,461 268 Notes: Details regarding the City's outstanding debt can be found in the notes to the financial statements. (1) Per rate covenants, this does not include the annual depreciation expense. (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. 136 TABLE 13 CITY OFMONROE, NORTH CAROLINA DEMOGRAPHIC AND ECONOMIC STATISTICS LAST TEN FISCAL YEARS Note: (1) Personal income not available for 2010 and 2011. Sources: (2) North Carolina Office of State Planning (3) US Department of Commerce - Bureau of Economic Analysis (4) Union County Schools (5) Employment Security Commission of North Carolina 137 TABLE 14 (County) Personal (County) (County) Income Per Capita Public (County) (City) (thousands of Personal School Unemployment Fiscal Population dollars) Income Enrollment Rate Year (2) (3) (3) (4) (5) 2002 27,756 3,805,788 27,535 24,173 5.40 2003 29,508 4,019,969 27,913 25,680 5.40 2004 30,392 4,414,129 29,194 27,031 5.20 2005 31,234 4,987,416 31,064 28,815 4.50 2006 32,454 5,617,550 32,626 31,580 3.80 2007 33,908 6,207,640 33,650 34,564 4.30 2008 35,966 6,512,312 33,673 37,110 5.60 2009 37,280 6,602,954 33,240 38,554 10.80 2010 (1) 38,120 - - 39,366 9.50 2011 (1) 33,007 39,900 9.40 Note: (1) Personal income not available for 2010 and 2011. Sources: (2) North Carolina Office of State Planning (3) US Department of Commerce - Bureau of Economic Analysis (4) Union County Schools (5) Employment Security Commission of North Carolina 137 TABLE 14 CITY OFMONROE, NORTH CAROLINA TABLE 15 PRINCIPAL EMPLOYERS CURRENT YEAR AND NINE YEARS AGO 2002 2011 Percentage of Percentage of Total City Employees Total City Employment Employer (1) Employment Employees (2) Tyson Foods ATI Allvac Carolinas Medical Center -Union Union County Charlotte Pipe Scott Safety City of Monroe Wal -Mart Stores, Inc. Colfax Corporation (IMO Pump) Goodrich Corporation Total Notes: (1) Data for 2002 not available. (2) Percentage of total city employment based on North Carolina Employment Security Commission labor force estimate of 14,648 as of June 30, 2011. Sources: City of Monroe Economic Development Department 138 1,500 1,250 1,500 573 450 550 460 350 265 250 7,148 10.2% 8.5% 10.2% 3.9% 3.1% 3.8% 3.1% 2.4% 1.8% CITY OF MONROE, NORTH CAROLINA FULL -TIME EQUIVALENT CITY GOVERNMENT EMPLOYEES BY FUNCTION LAST TEN FISCAL YEARS Function General Government: Administration Planning and zoning Engineering Utility /tax billing and collection Operations center Transportation Police Fire Building standards and code enforcement Culture and recreation Water and sewer: Distribution system Water filter plant Waste treatment plant Stormwater (2) Electric Natural gas Solid Waste (3) Aquatics and Fitness Center Airport (1) Total TABLE 16 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 23 24 25 25 24 31 30 32 33 28 12 13 12 12 12 11 11 11 8 8 8 11 10 11 10 11 10 10 10 9 17 16 17 17 14 17 18 18 19 19 9 10 10 9 12 12 12 8 9 9 21 24 23 22 24 25 24 21 15 19 71 76 75 80 87 90 91 95 99 101 48 55 58 61 70 82 78 82 82 79 11 11 10 10 10 9 9 10 4 6 46 46 46 48 49 50 50 49 46 44 26 29 32 31 31 29 31 33 33 34 9 8 10 10 10 10 10 11 11 11 12 13 14 14 15 15 15 14 13 14 - - - - - - - 8 10 10 20 21 18 21 22 22 25 24 27 26 12 14 14 14 13 13 14 13 13 13 19 20 21 20 20 20 20 20 20 20 - - - - 7 7 7 8 8 8 364 391 395 405 430 454 455 467 460 459 Note: (1) The City of Monroe assumed direct management of aviation services at the Monroe Regional Airport in March of 2006. In prior years, the FBO (Fixed Base (peration) had been managed by a private enterprise under contract to the City. (2) City of Monroe established a Stormwater utility program in 2009 (3) In 2011, a full time position was added to Solid Waste. Previously, the function was the responsibility of the Planning Department. Source: City of Monroe payroll system. 139 CITY OF MONROE, NORTH CAROLINA TABLE 17 OPERATING INDICATORS BY FUNCTION LAST TEN FISCAL YEARS (i available or unless otherwise noted) Function 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 Transportation Street reclamation (tons) - - - 552 2,232 4,052 6,545 8,065 2,858 2,295 Street repair (tons) 2,702 3,592 2,511 2,131 1,057 1,765 2,100 1,219 595 456 Utility repair (tons) 342 422 552 368 119 314 296 321 527 780 Sidewalk repair (cubic yards concrete) 570 522 405 565 444 646 451 25 66 116 Pipe repair and replacement (linear feet) 657 433 768 247 956 440 911 2,016 2,132 2,526 Police Physical arrests (calendar year) 4,623 4,745 4,309 4,443 4,335 4,596 4,094 3,468 3,204 - Parking violations (calendar year) 260 348 2,091 1,263 3,707 3,686 3,918 3,408 3,510 Traffic violations (calendar year) 5,295 6,274 6,929 5,571 8,433 7,282 6,672 4,889 6,368 Fire Calls for service (calendar year) 2,993 3,825 4,315 4,169 4,329 4,626 4,664 4,993 5,514 Fire code inspections (calendar year) 191 286 586 1,633 1,974 1,348 1,860 1,860 1,220 Civilian fire injuries (calendar year) 2 6 12 1 1 1 8 6 2 - Building standards & code enforcement Building permits issued 2,536 3,768 3,357 4,943 5,129 3,943 3,951 3,845 2,876 2,701 Building inspections 6,495 10,857 10,697 11,728 13,750 13,817 11,381 8,642 7,553 7,009 Code enforcement inspections 1,856 1,912 2,573 3,398 1,431 1,341 2,565 5,518 6,422 1,750 Environmental protection Solid waste collected (annual tonnage) 37,041 38,914 40,787 42,660 44,533 44,917 42,352 35,928 34,155 31,968 Recyclables collected (annual tonnage) 722 730 739 747 756 973 925 707 788 748 Culture and recreation Rounds of golf played (calendar year) 33,163 28,238 31,388 30,888 35,364 32,988 28,667 30,075 26,556 - Aquatics and fitness center members 10,391 11,273 13,468 16,138 17,546 18,200 20,824 20,889 20,444 19,972 Youth athletic program participants (calendar year) 425 450 630 750 800 775 775 486 400 - Water Average daily production (millions of gallons per day) 6.9 6.7 6.9 6.3 6.6 6.0 5.7 5.5 5.8 6.0 Maximum daily production (millions of gallons per day) 10.0 9.1 9.7 8.9 9.2 10.0 8.7 8.1 9.1 9.1 Customers 9,857 9,989 10,158 10,532 10,919 11,405 11,534 11,436 11,462 11,478 Gallons Billed (in thousands) 2,091,900 2,032,900 1,987,100 2,018,600 2,149,000 2,096,600 1,973,800 1,796,500 1,748,800 1,803,119 Sewer Average daily treatment (millions of gallons per day) 6.6 7.9 7.1 7.2 6.8 7.0 6.1 6.5 6.8 5.8 Customers 8,450 8,629 8,804 9,002 9,400 9,861 10,025 9,948 9,959 9,970 Gallons Billed (in thousands) 2,258,500 2,398,600 2,259,400 2,436,000 2,433,000 2,407,200 2,264,600 2,126,800 2,016,900 2,005,753 Electric Sales (megawatt hours) 521,550 520,540 550,615 524,129 585,253 587,377 620,185 595,689 591,112 655,358 Customers 9,480 9,611 9,710 9,892 10,142 10,452 10,467 10,331 10,324 10,307 Natural gas Sales/deliveries (thousand cubic feet) 230,201 275,125 268,447 257,326 261,484 279,446 275,840 264,370 273,909 308,852 Customers 8,389 8,711 8,932 9,167 9,533 10,113 10,340 10,287 10,216 10,233 Airport (1) Fuel sales (thousands of gallons) 328 314 327 367 377 390 421 324 345 339 Based aircraft 77 70 65 76 84 103 111 114 95 96 Notes (1) The City of Monroe assumed direct management of aviation services at the Monroe Regional Airport in March of 2006. In prior years, the FBO (Fixed Base Operation) had been managed by a private enterprise under contract to the City. Sources: Various City departments. 140 CITY OF MONROE, NORTH CAROLINA CAPITAL ASSET STATISTICS BYFUNCTION LAST TEN FISCAL YEARS (unless otherwise noted) Function 2002 2003 2004 2005 2006 2007 2008 2009 Transportation 61 127 127 34 34 15,884 Municipal Boundary (square miles) 24.27 28.63 28.71 28.75 29.09 29.45 29.60 29.63 Streets (miles) 149 157 158 158 158 158 161 164 Sidewalks (miles) 42 43 43 44 44 45 50 54 Curb and gutter (miles) 107 107 109 110 110 111 119 124 Stormwater (miles) 27 28 29 29 29 30 32 33 Bridges (square feet) 15,468 15,468 15,468 15,468 15,468 15,884 15,884 15,884 Speed humps /cushions (each) 135 153 166 184 204 232 232 242 Public safety Police stations 1 1 1 1 1 1 1 1 Patrol vehicles 76 76 79 85 89 89 89 92 Fire stations 4 5 5 5 5 5 5 5 Fire apparatus (line and reserve) 9 11 13 14 14 14 14 14 Culture and recreation Acreage (city limits) 552 552 552 552 552 552 552 552 Aquatics and Fitness Center 1 1 1 1 1 1 1 1 Playgrounds 8 8 8 8 8 8 8 8 Gymnasiums (1) 3 3 3 3 3 3 3 3 Basketball courts 8 8 8 8 8 8 8 8 Tennis courts 10 10 10 10 10 10 10 10 Playing fields (baseball/soccer /football) (2) 15 15 15 15 20 20 20 20 Swimming pools 2 2 3 3 3 3 3 3 Golf course 1 1 1 1 1 1 1 1 Driving range 1 1 1 1 1 1 1 1 Greenway (miles) - - - - 0.5 0.5 0.5 0.5 Water and sewer Water mains (miles) 272 276 279 289 292 293 291 291 Treatment capacity (millions of gallons per day) 11 11 11 11 11 11 11 11 Sewer Sanitary sewers (miles) (3) 268 269 270 285 287 283 294 294 Treatment capacity (millions of gallons per day) 9.0 9.0 9.0 10.4 10.4 10.4 10.4 10.4 Electric Substations (4) 7 7 7 7 7 7 8 9 Lines (miles per calendar year) 210 218 227 235 243 246 269 281 Natural gas Lines (miles per calendar year) 348 365 373 392 414 430 578 594 Airport Runway (feet) (6) 5,500 5,500 5,500 5,500 5,500 5,500 5,500 5,500 Hangars (square feet) (5) 42,659 42,659 42,659 42,659 53,134 53,134 77,292 85,865 Notes: (1) A new gymnasium was built at the J Ray Shute recreation center in 2010. (2) In 2006, the City received a Parks and Recreation Trust Fund (PARTF) grant for Phase II development of the Parks Williams Athletic Complex. The complex increased the number of soccer and softball fields. (3) In 2007, miles reported were lower than the prior year, as a result of GIS mapping corrections and refinements. (4) In 2009, a substation was added to serve the airport and surrounding area (5) In 2008, the City purchased an existing T -hangar from the Maxwell Group and built a new one. In 2009, the City bought the Southern Cross hangar. In addition to City owned hangars, there are private hangars on airport property. When these leases expire 20 years from initiation, they become property of the City. Currently, there is 17,530 square feet of private hangar space. (6) In 2011, an extension of runway 5 was completed. Sources: Various City departments. 141 TABLE 18 2010 2011 29.63 29.63 166 166 61 61 127 127 34 34 15,884 15,884 279 286 1 1 92 92 5 5 14 14 552 552 1 1 8 8 4 4 8 8 10 10 20 20 3 3 1 1 1 1 0.5 0.5 291 291 11 11 295 295 10.4 10.4 9 9 293 - 641 - 5,500 7,000 85,865 85,865 CITY OF .�IONROE a heritage of progress ê÷ìíêèíîóîè÷êîûðùíîèêíðíæ÷êöóîûîùóûðê÷ìíêèóîõûîøíî ùíïìðóûîù÷ûîøíèô÷êïûèè÷êéúûé÷øíîûîûçøóèíööóîûîùóûð éèûè÷ï÷îèéì÷êöíêï÷øóîûùùíêøûîù÷åóèô GOVERNMENT AUDITING 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, 2011, which collectively comprises the City of Monroe’s basic financial statements, and have issued our report thereon dated November 1, 2011. 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 õÍÆ×ÊÎÏ×ÎÈûÇØÓÈÓÎÕéÈÛÎØÛÊØÉ 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 Development Authority were not audited in accordance with õÍÆ×ÊÎÏ×ÎÈûÇØÓÈÓÎÕ éÈÛÎØÛÊØÉ. Internal Control Over Financial Reporting Management of the City of Monroe is responsible for establishing and maintaining effective 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 deficiency in internal control exists when the design or operation of a control does not allow management or employees, in the normal course of performing their assigned functions, to prevent or detect and correct misstatements on a timely basis. A material weakness is a deficiency, or a combination of deficiencies, in internal control such that there is a reasonable possibility that a material misstatement of the entity’s financial statements will not be prevented, or detected and corrected on a timely basis. Our consideration of the internal control over financial reporting was for the limited purpose described in the first paragraph of this section and was not designed to identify all deficiencies in internal control over financial reporting that might be deficiencies, significant deficiencies or material weaknesses. We did not identify any deficiencies in internal control over financial reporting that we consider material weaknesses, as defined above. However, we identified certain deficiencies in internal control over financial reporting described in the accompanying schedule of findings and questioned costs that we consider to be significant deficiencies in internal control over financial reporting. [11-1] A significant deficiency is a deficiency, or a combination of deficiencies, in internal control that is less severe than a material weakness, yet important enough to merit attention by those charged with governance. 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 143 instances of noncompliance or other matters that are required to be reported under õÍÆ×ÊÎÏ×ÎÈûÇØÓÈÓÎÕéÈÛÎØÛÊØÉ and which are described in the accompanying schedule of findings and questioned costs as item [11-1]. The City’s response to the finding identified in our audit is described in the accompanying schedule of findings and questioned costs. We did not audit the City’s response and accordingly, we express no opinion on it. We noted certain matters that we reported to management of the City of Monroe, in a separate letter dated November 1, 2011. This report is intended solely for the information and use of management, others within the entity, 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. November 1, 2011 Monroe, North Carolina 144 ê÷ìíêèíîùíïìðóûîù÷åóèôê÷ëçóê÷ï÷îèéûììðóùûúð÷èí÷ûùôïûòíêö÷ø÷êûð ìêíõêûïûîøóîè÷êîûðùíîèêíðíæ÷êùíïìðóûîù÷óîûùùíêøûîù÷åóèô íïúùóêùçðûêû ûîøèô÷éèûè÷éóîõð÷ûçøóèóïìð÷ï÷îèûèóíîûùè To the Honorable Mayor and Members of the City Council City of Monroe, North Carolina Compliance We have audited the City of Monroe, North Carolina, compliance with the types of compliance requirements described in the OMB ùÓÊÙÇÐÛÊû ùÍÏÌÐÓÛÎÙ×éÇÌÌÐ×Ï×ÎÈ and the ûÇØÓÈïÛÎÇÛÐÖÍÊõÍÆ×ÊÎÏ×ÎÈÛÐûÇØÓÈÍÊÉ ÓÎîÍÊÈÔùÛÊÍÐÓÎÛ, issued by the Local Government Commission, that could have a direct and material effect on each of the City of Monroe’s major federal programs for the year ended June 30, 2011. 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 õÍÆ×ÊÎÏ×ÎÈûÇØÓÈÓÎÕéÈÛÎØÛÊØÉ, issued by the Comptroller General of the United States; and OMB Circular A-133, ûÇØÓÈÉÍÖéÈÛÈ×ÉðÍÙÛÐõÍÆ×ÊÎÏ×ÎÈÉ, ÛÎØîÍÎìÊÍÖÓÈíÊÕÛÎÓÂÛÈÓÍÎÉ, 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 compliance requirements referred to above that could have a direct and material effect on each of its major federal programs for the year ended June 30, 2011. Internal Control Over Compliance 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 to determine the auditing procedures for the purpose of expressing our opinion on compliance and to test and report on internal control over compliance in accordance with OMB Circular A-133, 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 deficiency in internal control over compliance exists when the design or operation of a control over compliance does not allow management or employees, in the normal course of performing their assigned functions, to prevent, or detect and correct, noncompliance with a type of compliance requirement of a federal program on a timely basis. A material weakness in internal control over compliance is a deficiency, or a combination of deficiencies, in 145 internal control over compliance, such that there is a reasonable possibility that material noncompliance with a type of compliance requirement of a federal program will not be prevented, or detected and corrected, on a timely basis. Our consideration of internal control over compliance was for the limited purpose described in the first paragraph of this section and was not designed to identify all deficiencies in internal control over compliance that might be deficiencies, 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 entity, 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. November 1, 2011 Monroe, North Carolina 146 ê÷ìíêèíîùíïìðóûîù÷åóèôê÷ëçóê÷ï÷îèéûììðóùûúð÷èí÷ûùôïûòíêéèûè÷ ìêíõêûïûîøóîè÷êîûðùíîèêíðíæ÷êùíïìðóûîù÷óîûùùíêøûîù÷åóèô ûììðóùûúð÷é÷ùèóíîéíöíïúùóêùçðûêû ûîøèô÷éèûè÷éóîõð÷ûçøóè óïìð÷ï÷îèûèóíîûùè To the Honorable Mayor and Members of the City Council City of Monroe, North Carolina Compliance We have audited the City of Monroe, North Carolina, compliance with the types of compliance requirements described in the ûÇØÓÈïÛÎÇÛÐÖÍÊõÍÆ×ÊÎÏ×ÎÈÛÐûÇØÓÈÍÊÉÓÎîÍÊÈÔùÛÊÍÐÓÎÛ, issued by the Local Government Commission, that could have a direct and material effect on each of its major State programs for the year ended June 30, 2011. 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 õÍÆ×ÊÎÏ×ÎÈûÇØÓÈÓÎÕéÈÛÎØÛÊØÉ, issued by the Comptroller General of the United States; and applicable sections of OMB Circular A-133, as described in the ûÇØÓÈïÛÎÇÛÐÖÍÊõÍÆ×ÊÎÏ×ÎÈÛÐûÇØÓÈÍÊÉÓÎîÍÊÈÔùÛÊÍÐÓÎÛ, 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 of the City of Monroe’s compliance with those requirements. In our opinion, the City of Monroe complied, in all material respects, with the compliance requirements referred to above that could have a direct and material effect on each of its major State programs for the year ended June 30, 2011. Internal Control Over Compliance 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 the requirements that could have a direct and material effect on a major State program to determine the auditing procedures for the purpose of expressing our opinion on compliance and to test and report on internal control over compliance with applicable sections of OMB Circular A-133 and the State Single Audit Implementation Act, 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 deficiency in internal control over compliance exists when the design or operation of a control over compliance does not allow management or employees, in the normal course of performing their assigned functions, to prevent, or detect and correct, noncompliance with a type of compliance requirement of a State program on a timely basis. A material weakness in internal control over compliance is a deficiency, or combination of deficiencies, in internal 147 control over compliance, such that there is a reasonable possibility that material noncompliance with a type of compliance requirement of a State program will not be prevented, or detected and corrected, on a timely basis. Our consideration of internal control over compliance was for the limited purpose described in the first paragraph of this section and was not designed to identify all deficiencies in internal control over compliance that might be deficiencies, 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 entity, 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. November 1, 2011 Monroe, North Carolina 148 SCHEDULE 25 CITY OF MONROE, NORTH CAROLINA SCHEDULE OF FINDINGS AND QUESTIONED COSTS For the Fiscal Year Ended June 30, 2011 é×ÙÈÓÍÎóéÇÏÏÛÊÃÍÖûÇØÓÈÍÊɪê×ÉÇÐÈÉ Financial Statements T ype of auditors’ report issued: Unqualified Internal control over financial reporting: yes X no Material weakness(es) identified? Significant Deficiency(s) identified that are not considered to be material Xyes none reported weaknesses Noncompliance material to financial statements noted Xyes no Federal Awards Internal control over major federal programs: yes X no Material weakness(es) identified? Significant Deficiency(s) identified that are not considered to be material yes Xnone reported weaknesses 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 Xno Identification of major federal programs: CFDA NumberName of Federal Program 20.106 Airport Improvement Program 14.251 Economic Development Initiative - Special Project 16.710 COPS Technology Grant Dollar threshold used to distinguish between Type A and Type B Programs $300,000 Auditee qualified as low-risk auditee? Xyes no State Awards Internal control over major State programs: yes X no Material weakness(es) identified? Significant Deficiency(s) identified that are not considered to be material yes Xnone reported weaknesses 149 SCHEDULE 25, Continued CITY OF MONROE, NORTH CAROLINA SCHEDULE OF FINDINGS AND QUESTIONED COSTS For the Fiscal Year Ended June 30, 2011 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 Xno Identification of major State programs: Program Name Powell Bill é×ÙÈÓÍÎóóöÓÎÛÎÙÓÛÐéÈÛÈ×Ï×ÎÈöÓÎØÓÎÕÉ öÓÎØÓÎÕ   SIGNIFICANT DEFICIENCY MATERIAL NONCOMPLIANCE a) states that all moneys received and expended by a local government or public C riteria: G.S. 159-8( authority should be included in the budget ordinance. C ondition: The City of Monroe expended $166,844 more for the Airport Fund than appropriated in the annual budget ordinance. Effect: Moneys were spent that had not been appropriated. C ause: The City expended funds that had not been appropriated for in the budget ordinance prior to expending the funds. are expected to exceed R e commendation: Budget amendments should be adopted when amounts estimated expenditures in the budget ordinance prior to expending the funds. Views of responsible officials and planned corrective actions: The City agrees with this finding. Budget amendments will be adopted prior to making expenditures that exceed budgeted amounts. é×ÙÈÓÍÎóóóö×Ø×ÊÛÐûÅÛÊØöÓÎØÓÎÕÉÛÎØëÇ×ÉÈÓÍÎ×ØùÍÉÈÉ None reported. é×ÙÈÓÍÎóæéÈÛÈ×ûÅÛÊØÉöÓÎØÓÎÕÉÛÎØëÇ×ÉÈÓÍÎ×ØùÍÉÈÉ None reported. 150 SCHEDULE 26 CITY OF MONROE, NORTH CAROLINA CORRECTIVE ACTION PLAN For the Fiscal Year Ended June 30, 2011 é×ÙÈÓÍÎóóöÓÎÛÎÙÓÛÐéÈÛÈ×Ï×ÎÈöÓÎØÓÎÕÉ öÓÎØÓÎÕ  Name of contact person: Greg Demko, Director of Finance Corrective Action: Management at the Airport will review a budget-to-actual report prepared by the finance officer on a monthly basis. Budget amendments will be made as necessary. Proposed Completion Date: The City will implement the above procedure immediately. é×ÙÈÓÍÎóóóö×Ø×ÊÛÐûÅÛÊØöÓÎØÓÎÕÉÛÎØëÇ×ÉÈÓÍÎ×ØùÍÉÈÉ None reported. é×ÙÈÓÍÎóæéÈÛÈ×ûÅÛÊØÉöÓÎØÓÎÕÉÛÎØëÇ×ÉÈÓÍÎ×ØùÍÉÈÉ None reported. 151 SCHEDULE 27 CITY OF MONROE, NORTH CAROLINA SUMMARY SCHEDULE OF PRIOR YEAR AUDIT FINDINGS For the Fiscal Year Ended June 30, 2011 öÓÎØÓÎÕîÍÎ×Ê×ÌÍÊÈ×Ø 152 SCHEDULE 28 CITY OF MONROE, NORTH CAROLINA SCHEDULE OF EXPENDITURES OF FEDERAL AND STATE AWARDS For the Fiscal Year Ended June 30, 2011 ö×Ø×ÊÛÐö×Ø×ÊÛÐøÓÊ×ÙÈ õÊÛÎÈÍÊ ìÛÉÉèÔÊÍÇÕÔùöøûÛÎØìÛÉÉèÔÊÍÇÕÔéÈÛÈ×ðÍÙÛÐ ÊÛÎÈÍÊìÊÍÕÊÛÏèÈÐ×îÇÏÚ×÷ÄÌ×ÎØÈÇÊ×É÷ÄÌ×ÎØÈÇÊ×É÷ÄÌ×ÎØÈÇÊ×É õ ÓÊÓÓÓ Federal Grants: Cash Programs: U.S. Department of Justice: Direct Programs: Drug Enforcement Administration16.579$ 180,540$ 18,454$ 8,900 COPS Hiring Recovery Program16.710 106,007 - - COPS Technology Grant16.710 238,945 - - ARRA - Recovery Act Edward Byrne Memorial Justice Assistance Grant16.808 21,414 - - U.S. Department of Homeland Security: Direct Programs: Staffing for Adequate Fire & Emergency Response (SAFER)97.08373,324 - 423,637 Federal Aviation Administration: Airport Improvement Program20.106 2,150,000 - 238,889 N.C. Department of Transportation: Passed Through NC Department of Transportation: Natural Corridor Infrastructure Improvement Program20.205 -22,560 5,940 U.S. Department of Housing and Urban Development: Direct Programs Economic Development Initiative Special Project14.251487,210- - Total Assistance - Federal Programs3,280,000 18,454 677,366 State Grants: Cash Assistance: Transportaton: N.C. Department o fi Powell bill 1,000,949- - N.C. Department of Commerce: The One North Carolina Fund - 40,000 - N.C. Department of Community Assistance: Scattered Site Housing - 95,221 - N.C. Department of Health and Human Services: Aging Gran-4,081 1,360 t Total Assistance - State Programs- 1,140,251 1,360 Total Federal and State Assistance 3,280,000$ 1,158,705$ 678,726$ -Continued 153 SCHEDULE 28, Continued CITY OF MONROE, NORTH CAROLINA SCHEDULE OF EXPENDITURES OF FEDERAL AND STATE AWARDS For the Fiscal Year Ended June 30, 2011 Notes to the Schedule of Expenditures of Federal and State Financial Awards: 1. 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. 154