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Home My WebLink AboutReport - Mail Packet - 7/24/2018 - Memorandum From Travis Storin Re: 2017 Comprehensive Annual Financial Report (Cafr)COMPREHENSIVE ANNUAL FINANCIAL REPORT 2017 FORT COLLINS, COLORADO | YEAR ENDED DECEMBER 31, 2017 City of Fort Collins, Colorado Comprehensive Annual Financial Report For the fiscal year ended December 31, 2017 Prepared by the Finance Department: Travis Storin, Accounting Director John Voss, Senior Manager Jennifer Selenske, Senior Accountant Twyla Lance, Accountant II Kerri Ishmael, Accountant II Renee Callas, Accounting Clerk Special thanks for their contributions: Blaine Dunn, Investment Administrator About our cover and section tabs… The cover picture photograph features Twin Silo Park, a new jewel in the Fort Collins parks system opened in November 2017. This one-of-a-kind 54-acre park carries agriculturally-themed features such as an orchard, large community garden, and hops trestles. The park includes traditional fields such as ballfields, as well as less common features such as pickleball courts and a BMX track. Finally, the park’s centerpiece and namesake: two 48-foot tall former grain silos relocated from city property. The silos are connected by a tall slide and stand over a play area cleverly designed as a barn. The Introductory Section tab features City Manager Darin Atteberry and other city personnel accepting the Malcolm Baldrige National Quality Award. On November 16, 2017, U.S. Commerce Secretary Wilbur Ross named the City of Fort Collins and four other organizations as the 2017 recipients of the Baldrige Award. This Presidential-level honor recognizes exemplary practices among American organizations and businesses including a drive for radical innovation, thoughtful leadership, and administrative improvement. The Financial Section tab features an Economic Health Listening Session at Wolverine Farm Letterpress & Publick House, a local nonprofit event space and café. The City hosted these sessions throughout the year as part of a strategy to improve business engagement, allowing local business representatives direct engagement with the Mayor and City Manager on topics important to them, including broadband, small business support, and development review. The Management’s Discussion and Analysis tab features scenes from the CityWorks 101 program. This eight- week program gives residents an up-close look at the many facets of local government. Participants develop a deeper understanding of how the City makes decisions, allocates funds, and delivers community services, thereby developing future leaders through well informed and engaged residents. The Basic Financial Information tab features the ribbon cutting for the new Firehouse Alley parking structure. An excellent example of collaboration, it was built in conjunction with the new Elizabeth Hotel in downtown Fort Collins. In partnering on the parking garage with the hotel’s developers, the City is simultaneously supporting its Council-adopted Parking Plan and a longstanding economic and cultural goal of having a boutique hotel in the downtown area. The Notes to the Basic Financial Statements tab features the lighting ceremony for Downtown Holiday Lights, co-produced by the City, Downtown Development Authority, and Downtown Business Association. More than 76,000 LED bulbs twinkle throughout the holiday season, providing a festive atmosphere for shoppers, ice skaters, carriage rides, and restaurant-goers alike. The Supplementary Information tab features the opening of the Walk & Wheel Skills Hub. The Skills Hub opened in 2017 and is a miniature city complete with streets, bike lanes, and traffic signs. It is designed to provide a safe bicycling and walking learning environment for people of all ages and abilities, with the goal of improving safety and increasing bicycling and walking. Between May and October, the City hosts drop-in sessions with an instructor for people to learn how to navigate the course and safety tips for around town. The Statistical Section tab features the annual Hogwarts Halloween event at the Northside Aztlan Recreation Center. Witches and wizards from kindergarten up to eighth grade join for a night of Harry Potter fun, playing Quidditch, drinking butterbeer, being sorted into their house, creating potions, and walking through haunted hallways. The Other Schedules tab features the groundbreaking on a five-acre expansion of the Gardens on Spring Creek. The $2.5 million project will include the Great Lawn and outdoor performance venue, Undaunted Garden, Prairie Garden, Foothills Garden, and several educational and themed gardens. This partnership between the City, Friends of the Gardens, and lead donors Bohemian Foundation and Woodward, Inc. is estimated to be open in August 2018. City of Fort Collins Comprehensive Annual Financial Report i Table of Contents Page INTRODUCTORY SECTION ................................................................................................................ 1 Letter of Transmittal ..................................................................................................................................... 3 Certificate of Achievement for Excellence in Financial Reporting .............................................................. 7 Organizational Chart ..................................................................................................................................... 8 Elected and Appointed Officials ................................................................................................................... 9 FINANCIAL SECTION ......................................................................................................................... 11 Independent Auditor’s Report .................................................................................................................... 13 MANAGEMENT’S DISCUSSION AND ANALYSIS ......................................................................... 15 BASIC FINANCIAL STATEMENTS .................................................................................................. 27 Government-wide Financial Statements Statement of Net Position .............................................................................................................. 29 Statement of Activities .................................................................................................................. 30 Fund Financial Statements Governmental Fund Financial Statements Balance Sheet .................................................................................................................. 32 Reconciliation of the Balance Sheet of Governmental Funds to the Statement of Net Position ............................................................................................... 33 Statement of Revenues, Expenditures, and Changes in Fund Balances ........................... 34 Reconciliation of the Statement of Revenues, Expenditures, and Changes in Fund Balances of Governmental Funds to the Statement of Activities .......................... 35 Statement of Revenues, Expenditures, and Changes in Fund Balances Actual and Budget (Non-GAAP budgetary basis) - General Fund (Consolidated) ........ 36 Statement of Revenues, Expenditures, and Changes in Fund Balances Actual and Budget (Non-GAAP budgetary basis) - Keep Fort Collins Great Fund....…….…...37 Statement of Revenues, Expenditures, and Changes in Fund Balances Actual and Budget (Non-GAAP budgetary basis) – Urban Renewal Authority Fund (Consolidated) ................................................................................................................. 39 Proprietary Fund Financial Statements Statement of Net Position ................................................................................................. 40 Statement of Revenues, Expenses, and Changes in Fund Net Position ........................... 42 Statement of Cash Flows .................................................................................................. 44 Fiduciary Fund Financial Statements Statement of Fiduciary Net Position ................................................................................. 46 Statement of Changes in Fiduciary Net Position .............................................................. 47 Notes to the Basic Financial Statements ........................................................................................ 49 REQUIRED SUPPLEMENTARY INFORMATION OTHER THAN MD&A Modified Approach for City Streets Infrastructure Capital Assets ............................................................. 96 Pension and Other Postemployment Benefits Plan Schedule ..................................................................... 98 SUPPLEMENTARY INFORMATION Non-Major Governmental Funds .............................................................................................................. 104 Balance Sheet .............................................................................................................................. 108 Combining Statement of Revenues, Expenditures and Changes in Fund Balance ...................... 109 Schedule of Revenues, Expenditures, and Changes in Fund Balances – Actual and Budget Capital Expansion (Non-GAAP Budgetary Basis) ......................................................... 113 ii City of Fort Collins Comprehensive Annual Financial Report Sales and Use Tax (Non-GAAP Budgetary Basis) ......................................................... 114 Community Capital Improvement (Non-GAAP Budgetary Basis) ................................ 115 Natural Areas (Non-GAAP Budgetary Basis) ................................................................ 116 Cultural Services and Facilities (Non-GAAP Budgetary Basis) .................................... 117 Recreation (Non-GAAP Budgetary Basis) ..................................................................... 118 Cemeteries (Non-GAAP Budgetary Basis) .................................................................... 119 Perpetual Care (Non-GAAP Budgetary Basis) ............................................................... 120 Community Development Block Grant (Non-GAAP Budgetary Basis) ........................ 121 Home Program Fund (Non-GAAP Budgetary Basis) ..................................................... 122 Transit Services (Non-GAAP Budgetary Basis) ............................................................ 123 Transportation CEF (Non-GAAP Budgetary Basis) ...................................................... 124 Transportation Services (Non-GAAP Budgetary Basis) ................................................ 125 Parking Services (Non-GAAP Budgetary Basis) ........................................................... 126 General Improvement District No. 1 (Non-GAAP Budgetary Basis) ............................ 127 General Improvement District No. 15 - Skyview (Non-GAAP Budgetary Basis) ......... 128 Timberline/Prospect SID #94 (Non-GAAP Budgetary Basis) ....................................... 129 Fort Collins Leasing Corporation (Non-GAAP Budgetary Basis) ................................. 130 Neighborhood Parkland (Non-GAAP Budgetary Basis) ................................................ 131 Conservation Trust (Non-GAAP Budgetary Basis) ........................................................ 132 General Fund Combining Schedules ........................................................................................................ 133 Balance Sheet .............................................................................................................................. 134 Combining Statement of Revenues, Expenditures and Changes in Fund Balance ...................... 135 Schedule of Revenues, Expenditures and Changes in Fund Balances – Actual and Budget (Non- GAAP Budgetary Basis) ............................................................................................................. 136 Museum (Non-GAAP Budgetary Basis) ........................................................................ 137 Emergency (Non-GAAP Budgetary Basis) .................................................................... 138 Urban Renewal Authority ......................................................................................................................... 139 Balance Sheet .............................................................................................................................. 140 Combining Statement of Revenues, Expenditures and Changes in Fund Balance ...................... 141 Schedule of Revenues, Expenditures and Changes in Fund Balances – Actual and Budget North College District (Non-GAAP Budgetary Basis) ................................................... 142 Prospect South TIF District (Non-GAAP Budgetary Basis) .......................................... 143 Foothills Mall District (Non-GAAP Budgetary Basis) ................................................... 144 Capital Project Fund ................................................................................................................................. 145 Schedule of Revenues, Expenditures, and Changes in Fund Balance – Actual and Budget (Non-GAAP budgetary basis) ............................................. 147 Enterprise Funds ....................................................................................................................................... 150 Schedule of Revenues, Expenses and Changes in Net Position – Actual and Budget Light and Power (Non-GAAP Budgetary Basis) ............................................................ 151 Water (Non-GAAP Budgetary Basis) ............................................................................ 152 Wastewater (Non-GAAP Budgetary Basis) ................................................................... 153 Storm Drainage (Non-GAAP Budgetary Basis) ............................................................. 154 Golf (Non-GAAP Budgetary Basis) ............................................................................... 155 Internal Service Funds .............................................................................................................................. 156 Combining and Individual Fund Financial Statements and Schedules Statement of Net Position ............................................................................................................ 157 Statement of Revenues, Expenses and Changes in Net Position ................................................. 159 Statement of Cash Flows ............................................................................................................. 161 Schedule of Revenues, Expenses and Changes in Net Position – Actual and Budget Equipment (Non-GAAP Budgetary Basis) ..................................................................... 163 Self Insurance (Non-GAAP Budgetary Basis) ............................................................... 164 Data and Communications (Non-GAAP Budgetary Basis) ............................................ 166 Benefits (Non-GAAP Budgetary Basis) ......................................................................... 169 Utility Customer Service and Administrative (Non-GAAP Budgetary Basis) ............... 167 City of Fort Collins Comprehensive Annual Financial Report iii Fiduciary Funds ........................................................................................................................................ 168 Combining and Individual Fund Financial Statements and Schedules Schedule of Changes in Net Position Held in Trust for Pension Benefits—Actual and Budget ...................................................................................... 169 Statement of Agency Funds Assets and Liabilities ..................................................................... 170 Statement of Changes in Agency Funds Assets and Liabilities ................................................... 171 Component Unit Funds ............................................................................................................................. 172 Combining and Individual Fund Financial Statements and Schedules Reconciliation of the Balance Sheet to the Statement of Net Position ........................................ 173 Reconciliation of the Statement of Revenues, Expenditures, and Changes in Fund Balances to the Statement of Activities ............................................................................ 174 Balance Sheet ............................................................................................................................. 175 Statement of Revenues, Expenditures, and Changes in Fund Balance ........................................ 176 Schedule of Revenues, Expenditures and Changes in Fund Balances – Actual and Budget General (Non-GAAP Budgetary Basis) .......................................................................... 177 Debt Service (Non-GAAP Budgetary Basis).................................................................. 178 STATISTICAL SECTION ................................................................................................................... 180 Net Position by Component – Last Ten Years ......................................................................................... 181 Changes in Net Position – Last Ten Years ............................................................................................... 182 Fund Balances, Governmental Funds – Last Ten Years ........................................................................... 183 Changes in Fund Balances, Governmental Funds – Last Ten Years ........................................................ 184 Taxable Sales by Category – Last Ten Years ........................................................................................... 185 Direct and Overlapping Sales Tax Rates – Last Ten Years ...................................................................... 186 Sales Tax Revenue Taxpayers by Industry ............................................................................................... 187 Ratios of Outstanding Debt by Type – Last Ten Years ............................................................................ 188 Ratios of General Bonded Debt Outstanding – Last Ten Years ............................................................... 189 Direct and Overlapping Governmental Activities Debt ............................................................................ 190 Legal Debt Margin Information – Last Ten Years ................................................................................... 191 Pledged Revenue Coverage – Last Ten Years .......................................................................................... 192 Demographic and Economic Statistics ..................................................................................................... 193 Principal Employers .................................................................................................................................. 194 Full-time Equivalent City Employees by Function/Program – Last Ten Years ....................................... 195 Operating Indicators by Function/Program – Last Ten Years .................................................................. 196 Capital Asset Statistics by Function/Program – Last Ten Years .............................................................. 197 OTHER SCHEDULES Electric Utility Enterprise SEC Rule 15c2-12 Information ...................................................................... 200 Wastewater Utility Enterprise SEC Rule 15c2-12 Information ................................................................ 205 Storm Drainage Utility Enterprise SEC Rule 15c2-12 Information ......................................................... 211 Water Utility Enterprise SEC Rule 15c2-12 Information ......................................................................... 213 Fort Collins Urban Renewal Authority SEC Rule 15c2-12 Information .................................................. 218 Local Highway Finance Report Form FHWA-536 .................................................................................. 230 iv City of Fort Collins Comprehensive Annual Financial Report THIS PAGE INTENTIONALLY LEFT BLANK INTRODUCTORY SECTION City of Fort Collins Comprehensive Annual Financial Report 1 INTRODUCTORY SECTION 2 City of Fort Collins Comprehensive Annual Financial Report THIS PAGE INTENTIONALLY LEFT BLANK City of Fort Collins Comprehensive Annual Financial Report 3 June 19, 2018 Honorable Mayor, Members of City Council, Residents and Customers of the City of Fort Collins, Colorado: We submit, for your information and review, the Comprehensive Annual Financial Report (CAFR) for the City of Fort Collins, Colorado (the City), for the year ended December 31, 2017. This report consists of management’s representations concerning the finances of the City of Fort Collins. Consequently, management assumes responsibility for both the accuracy of the data and the completeness and fairness of the presentation, including all disclosures, based upon a comprehensive framework of internal control that it has established for this purpose. Because the cost of internal control should not exceed anticipated benefits, the objective is to provide reasonable, rather than absolute, assurance that the financial statements are free of any material misstatements. To the best of our knowledge and belief, the enclosed information is reported in a manner designed to present fairly the financial position and activities of the various funds of the City. The City has included all disclosures necessary to enable the reader to gain an understanding of the City’s financial activities. The City Charter and State law require an annual audit by independent certified public accountants selected by the City Council. The goal of the independent audit was to provide reasonable assurance that the financial statements of the City for the fiscal year ended December 31, 2017 are free of material misstatement. The independent accountant, RSM US LLP, concluded, based upon the audit, that there was a reasonable basis for rendering an unmodified opinion that the City’s financial statements for the fiscal year ended December 31, 2017, are fairly presented in conformity with accounting principles generally accepted in the United States of America. The independent audit of the financial statements of the City is required to complete the federally mandated “Single Audit” designed to meet the special needs of the federal grantor agencies. The results of the single audit are available in the City’s separately issued Single Audit Report (Compliance Report). Accounting principles generally accepted in the United States of America 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. The City’s MD&A can be found immediately following the report of the independent auditor. Governmental Structure The City of Fort Collins, incorporated in 1872, is located in north central Colorado, east of the continental divide, and is approximately sixty miles north of Denver. It is the fourth largest city in Colorado with an estimated population of 170,100 as of March 2018. This over 50% of the Larimer County population. The City provides services that include community planning, general government, police, streets and highways, cultural facilities, parks and recreation, transportation, golf courses and public utilities. The City’s utilities include electric distribution, water treatment, wastewater treatment and storm drainage. Fire protection and library services are not provided by the City but instead by Poudre Fire Authority (PFA) and Poudre River Public Library District. The City is the primary financial supporter for PFA. 215 N. Mason Street 2nd Floor PO Box 580 Fort Collins, CO 80522 970.221.6562 970.221.6782 - fax fcgov.com 4 City of Fort Collins Comprehensive Annual Financial Report The City’s financial statements include the Downtown Development Authority, Fort Collins Capital Leasing Corporation, General Improvement District No. 1, General Improvement District No. 15 – Skyview and the Urban Renewal Authority. The City is a home rule city, organized under provisions of the Colorado Constitution. The City Charter, adopted in 1953, provides for the council-manager form of local government. The voters directly elect the mayor to serve a two- year term. Within districts, voters elect six Council members on a non-partisan basis, to staggered four-year terms. The financial statements, schedules and statistical tables contained in this report include all funds under the control of City Council. The Council is responsible for passing ordinances, adopting the two-year budget and annual appropriations ordinance, appointing advisory board and commission members, and hiring the City Manager, City Attorney, and Municipal Judge. The City Manager is responsible for implementing the policies and ordinances of Council, overseeing the day-to-day operations and appointing service area directors and other staff members. Financial Condition: Economy, Long-Term Financial Planning and Major Initiatives The essential economic indicators for the City were moderate to strong in 2017. At the end of 2017, the local unemployment rate stood at 2.2%, which compares favorably to the state rate of 3.0% and national rate of 4.1%. The City relies heavily on sales and use tax revenues, which decreased slightly in 2017. Sales taxes and use taxes were up 2.4% and down 12.0%, respectively, for a blended decrease of 0.3%. Inflation was 3.7%, as measured by the Denver-Boulder-Greeley Consumer Price Index for the second half of 2017 versus the second half of 2016. Overall governmental fund revenue increased 7.3% in 2017. This was attributable to offsetting changes: the aforementioned decrease in sales and use taxes, an increase in volume of development-related fees, and increased Transit-related grant revenues. At year-end, the City held $310.2 million in unrestricted net position and $1.9 billion in total net position, $3.5 million less and $78.4 million more, respectively, than it held in 2016. Please see page 18 for more information about the City’s total net position. Data-driven and Transparent. Over the last decade, the City has undergone transformational change, deliberately embracing transparency, accountability and continuous improvement. Citizens have more avenues than ever to keep up to speed on initiatives, news, programs, or requests for City services: • Access Fort Collins at fcgov.com/accessfortcollins is an easy way to reach the City with questions, comments, or service requests. The platform ensures that citizens directly reach the staff best equipped to address their concerns. • Open Book is an online tool designed to disclose expenses in a simple to use format for members of the public interested in how the local government spends its revenues. Open Book can be viewed online at fcgov.com/openbook • OpenCity is a City initiative started in 2016 to take transparency to the next level. The goal is to maintain a web portal to host data sets that are available to the public in a format that citizens can easily search, filter, and utilize in in innovative and creative way. There are a number of data sets already available with more scheduled to go-live in the near future, including crime statistics, traffic information, construction permits, City facility utility usage, annexations, and various master plans. • Regularly updated video content, available at fcgov.com/fctv or on basic cable, provides several programming options designed to inform, educate, and inspire. Content includes Council meetings and public forums, plus regular programming including CityView, a bi-weekly news series that highlights major stories, initiatives, and upcoming events throughout the City in less than five minutes. • The Community Dashboard, an online tool that measures the community’s progress in attaining the City’s strategic outcomes. Key metrics such as voluntary code compliance, unemployment rate, community energy use, number of local traffic crashes and transit passengers per revenue hour are measured and monitored so the City can adapt certain programs to ensure targets are met and improve performance where necessary. The Community Dashboard can be viewed at fcgov.com/dashboard. • Strategy Maps are a newly created internal management tool designed to enhance the use of metrics, targets, and initiatives to track the City’s progress against its 7 Key Outcome Areas and 54 Strategic Objectives. More information about the 2018 Strategic Plan and Strategy Maps can be found at fcgov.com/strategicplan. City of Fort Collins Comprehensive Annual Financial Report 5 • Another tool staff is using to become more data driven is the Financial Monthly Report (FMR), an internal report prepared monthly by managers and reviewed by City executives. Management uses this report to closely analyze their department’s budget expenditures and revenues. The report also communicates departments’ projects, goals and needs to other departments. • Citizens can also stay current and provide feedback utilizing social media platforms such as Facebook, Twitter, or Instagram. Malcolm Baldrige National Quality Award. On November 16, 2017 U.S. Commerce Secretary Wilbur Ross named the City of Fort Collins and four other organizations as the 2017 recipients of the Malcolm Baldrige National Quality Award. This Presidential-level honor recognizes exemplary practices among American organizations and businesses including a drive for radical innovation, thoughtful leadership, and administrative improvement. Receiving the award was the culmination of a rigorous, multiyear pursuit for the City, as only the third city to win in the prestigious award’s 30-year history. Fort Collins began applying at the state-level in 2011 with the Rocky Mountain Performance Excellence (RMPEx) program. After receiving the highest level “Peak status” from RMPEx in 2014, the City began applying to the national Baldrige program through the National Institute of Standards and Technology (NIST) in 2015. Additional information on the Baldrige Performance Excellence Program is located at https://www.nist.gov/baldrige. ICMA Excellence in Performance Management. In June 2017 the City was awarded by the International City/County Management Association (ICMA) for its data-driven management and reporting efforts. Recipients ensure reliability of data, train staff in performance measurement, and report data to the public through budgets, newsletters, and/or information provided to and by elected officials. Certificates are awarded at three levels: Achievement, Distinction, and the highest level, Excellence. Fort Collins’s notification cited its key outcome reporting, surveys of residents and employees, performance dashboards, and development of a performance culture. Its eighth year receiving ICMA recognition, Fort Collins was one of 25 jurisdictions receiving the Certificate of Excellence. Twin Silo Park. A new jewel in the Fort Collins parks system, Twin Silo Park opened in November 2017. This one- of-a-kind 54-acre park carries agriculturally-themed features such as an orchard, large community garden, and hops trestles. The park includes traditional fields such as ballfields, as well as less common features such as pickleball courts and a BMX track. Finally, the park’s centerpiece and namesake: two 48-foot tall former grain silos relocated from city property. The silos are connected by a tall slide and stand over a play area cleverly designed as a barn. Broadband Internet Service. In November 2017, Fort Collins voters approved a Utility Charter amendment to add telecommunication services and, with subsequent Council direction, issue bonds of up to $150M. Fort Collins began prioritizing broadband after community outreach in the 2014 Budget for Outcome process. In 2015, voters first indicated their support for Broadband by approving a home-rule exception to SB152, which restricts local government participation in telecommunications. After considerable analysis of alternatives, third-party consulting, community outreach, and due diligence, in 2018 the City Council directed staff to issue bonds and begin construction of a municipally-owned, retail network with the objective of servicing its first customers in late 2019. Lincoln Corridor Plan. In 2017 the City completed construction of a community-supported vision for one of its critical connections from Downtown Fort Collins to the eastern side of the community. The area has a strong, diverse, and “uniquely Fort Collins” mix of retail, industry, offices, recreation, and neighborhoods with rich history and culture. The finished project created a multi-modal design along the corridor and replaced the Poudre River Bridge, thereby improving mobility, safety, and flood control, all while enhancing the appearance and creating a street with a unique identity. Other Information Certificate of Achievement for Excellence in Financial Reporting. 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 Fort Collins for its comprehensive annual financial report for the year ended December 31, 2016. This 6 City of Fort Collins Comprehensive Annual Financial Report was the 31st consecutive year that the City has achieved this prestigious award. In order to earn a Certificate of Achievement, a governmental unit must publish an easily readable and efficiently organized comprehensive annual report. This report must satisfy both applicable legal requirements and accounting principles generally accepted in the United States of America. A reproduction of the Certificate of Achievement is included at the end of the introductory section of the comprehensive annual financial report. A Certificate of Achievement is valid for a period of one year only. We believe that our current comprehensive annual financial report continues to meet the requirements of the Certificate of Achievement Program and we will submit it to the GFOA to determine its eligibility for another certificate. Acknowledgments. We recognize the dedicated efforts of all officials and staff involved in managing and accounting for the City’s financial operations. The process of financial planning, management, and accounting requires a team effort by City Council and City staff to be successful. The preparation of this 2017 Comprehensive Annual Financial Report was made possible by the dedicated service of the entire Finance Department. We would like to recognize the members of the Accounting Division who worked many extra hours to ensure the completion of this document and fulfill other financial responsibilities over the past few months. We also thank RSM US LLP, the firm that serves as the City’s external auditor. Respectfully submitted, Darin A. Atteberry City Manager Michael N. Beckstead Chief Financial Officer City of Fort Collins Comprehensive Annual Financial Report 7 8 City of Fort Collins Comprehensive Annual Financial Report City of Fort Collins Comprehensive Annual Financial Report 9 City of Fort Collins, Colorado Elected and Appointed Officials As of December 31, 2017 Elected Officials Wade Troxell ........................................................................................................................................ Mayor Bob Overbeck ........................................................................................................ District 1 Councilmember Ray Martinez ......................................................................................................... District 2 Councilmember Ken Summers......................................................................................................... District 3 Councilmember Kristin Stephens ..................................................................................................... District 4 Councilmember Ross Cunniff .......................................................................................................... District 5 Councilmember Gerry Horak ............................................................................... Mayor Pro Tem, District 6 Councilmember Appointed Officials Darin Atteberry ......................................................................................................................... City Manager Delynn Coldiron ........................................................................................................................... City Clerk* Carrie Daggett ........................................................................................................................... City Attorney Kathleen Lane .............................................................................................................................. Chief Judge *City Manager appointed, City Council approved City Officials and Department Directors Jeff Mihelich ................................................................................................................. Deputy City Manager Wendy Williams ........................................................................................................ Assistant City Manager Kelly DiMartino............................................................................................. Senior Assistant City Manager Mike Beckstead ......................................................................................................... Chief Financial Officer Laurie Kadrich ............................................................. Planning, Development and Transportation Director Jackie Kozak-Thiel ............................................................................................. Chief Sustainability Officer Terrence Jones (interim) ......................................................................................................... Chief of Police Kevin Gertig ....................................................................................................... Utilities Executive Director 10 City of Fort Collins Comprehensive Annual Financial Report THIS PAGE INTENTIONALLY LEFT BLANK FINANCIAL SECTION City of Fort Collins Comprehensive Annual Financial Report 11 FINANCIAL SECTION 12 City of Fort Collins Comprehensive Annual Financial Report THIS PAGE INTENTIONALLY LEFT BLANK 13 Independent Auditor's Report To the Honorable Mayor and Members of the City Council and City Manager City of Fort Collins, Colorado Report on the Financial Statements We have audited the accompanying financial statements of the governmental activities, the business-type activities, the discretely presented component unit, each major fund, and the aggregate remaining fund information of the City of Fort Collins, Colorado (the City) as of and for the year ended December 31, 2017, and the related notes to the financial statements, which collectively comprise the City’s basic financial statements as listed in the table of contents. Management’s Responsibility for the Financial Statements Management is responsible for the preparation and fair presentation of these financial statements in accordance with accounting principles generally accepted in the United States of America; this includes the design, implementation, and maintenance of internal control relevant to the preparation and fair presentation of financial statements that are free from material misstatement, whether due to fraud or error. Auditor’s Responsibility Our responsibility is to express opinions on these financial statements based on our audit. We conducted our audit in accordance with auditing standards generally accepted in the United States of America and the standards applicable to financial audits contained in Government Auditing Standards, issued by the Comptroller General of the United States. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free from material misstatement. An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the financial statements. The procedures selected depend on the auditor’s judgment, including the assessment of the risks of material misstatement of the financial statements, whether due to fraud or error. In making those risk assessments, the auditor considers internal control relevant to the entity’s preparation and fair presentation of the financial statements in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the entity’s internal control. Accordingly, we express no such opinion. An audit also includes evaluating the appropriateness of accounting policies used and the reasonableness of significant accounting estimates made by management, as well as evaluating the overall presentation of the financial statements. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinions. Opinions In our opinion, the financial statements referred to above present fairly, in all material respects, the respective financial position of the governmental activities, the business-type activities, the discretely presented component unit, each major fund, and the aggregate remaining fund information of the City of Fort Collins, Colorado, as of December 31, 2017, and the respective changes in financial position and, where applicable, cash flows thereof and the respective budgetary comparison for the General Fund, the Keep Fort Collins Great Fund, and Urban Renewal Authority Fund for the year then ended in accordance with accounting principles generally accepted in the United States of America. 14 Emphasis of Matter As explained in Note 1 to the basic financial statements, the City adopted GASB Statement No. 75, Accounting and Financial Reporting for Postemployment Benefits Other Than Pensions which restated beginning net position of the governmental activities, business-type activities, Light & Power fund and Wastewater fund. Other Matters Required Supplementary Information Accounting principles generally accepted in the United States of America require that the Management’s Discussion and Analysis, the modified approach for City Streets Infrastructure capital assets, and pension and postemployment information, as listed in the table of contents, be presented to supplement the basic financial statements. Such information, although not a part of the basic financial statements, is required by the Governmental Accounting Standards Board who considers it to be an essential part of financial reporting for placing the basic financial statements in an appropriate operational, economic or historical context. We have applied certain limited procedures to the required supplementary information in accordance with auditing standards generally accepted in the United States of America, which consisted of inquiries of management about the methods of preparing the information and comparing the information for consistency with management’s responses to our inquiries, the basic financial statements, and other knowledge we obtained during our audit of the basic financial statements. We do not express an opinion or provide any assurance on the information because the limited procedures do not provide us with sufficient evidence to express an opinion or provide any assurance. Other Information Our audit was conducted for the purpose of forming opinions on the financial statements that collectively comprise the City of Fort Collins, Colorado’s basic financial statements. The combining and individual nonmajor fund financial statements and other schedules, listed in the table of contents as supplementary information, and the other information, such as the introductory and statistical section are presented for purposes of additional analysis and are not a required part of the basic financial statements. The combining and individual nonmajor fund financial statements and other schedules, are the responsibility of management and were derived from and relate directly to the underlying accounting and other records used to prepare the basic financial statements. Such information has been subjected to the auditing procedures applied in the audit of the basic financial statements and certain additional procedures, including comparing and reconciling such information directly to the underlying accounting and other records used to prepare the basic financial statements or to the basic financial statements themselves, and other additional procedures in accordance with auditing standards generally accepted in the United States of America. In our opinion, this information is fairly stated, in all material respects, in relation to the basic financial statements as a whole. The accompanying introductory, statistical sections and other schedules, as listed in the table of contents, have not been subjected to the auditing procedures applied in the audit of the basic financial statements, and accordingly, we do not express an opinion or provide any assurance on them. Other Reporting Required by Government Auditing Standards In accordance with Government Auditing Standards, we have also issued our report dated June 19, 2018 on our consideration of the City of Fort Collins, Colorado's internal control over financial reporting and on our tests of its compliance with certain provisions of laws, regulations, contracts, and 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 internal control over financial reporting or on compliance. That report is an integral part of an audit performed in accordance with Government Auditing Standards in considering City of Fort Collins, Colorado’s internal control over financial reporting and compliance. Denver, Colorado June 19, 2018 MANAGEMENT’S DISCUSSION & ANALYSIS City of Fort Collins Comprehensive Annual Financial Report 15 MANAGEMENT’S DISCUSSION AND ANALYSIS The City of Fort Collins (the City) offers the readers of the City’s financial statements this narrative overview and analysis of the financial activities for the year ended December 31, 2017. In addition to this overview and analysis based on currently known facts, decisions and conditions, the City would encourage readers to consider the information presented in the City’s letter of transmittal and the City’s financial statements, which begin on pages 3 and 27 of this report, respectively. Financial Highlights The assets and deferred outflows of resources of the City exceeded its liabilities and deferred inflows of resources at December 31, 2017 by $1.9 billion (net position). Of the net position balance, $310 million is unrestricted and is available to meet the government’s ongoing obligations in accordance with the City’s fund designations and fiscal policies. The City’s net position increased by $76.9 million (4.2%). The governmental net position increased by $43.3 million (4.2%) and the business-type position increased by $33.6 million (4.2%). The General Fund, the City’s primary operating fund, ended 2017 with a $70.7 million fund balance, a decrease of $4.6 million on a current financial resource basis. Of this amount, $64.3 million is spendable. The City’s total long-term liabilities decreased by $9.9 million (8.3%) during the current year. Within that activity, the City’s governmental long-term liabilities increased by $2.3 million and business-type long-term liabilities decreased by $12.2 million. The City issued $8.4 million of Certificates of Participation (COP) with an interest rate of 2.4% in 2017 to finance its share of the Firehouse Alley parking structure. Overview of the Financial Statements This discussion and analysis is intended to serve as an introduction to the City’s basic financial statements. The City’s basic financial statements consist of the following three components: 1) Government–wide Financial Statements, 2) Fund Financial Statements and 3) Notes to the Financial Statements. Other supplementary information is also included at the end of the report. Government-wide financial statements. The government–wide statements are designed to provide readers with a broad overview of the City’s finances using the accrual basis of accounting, the basis of accounting used by most private-sector businesses. The statement of net position presents information on the City’s assets, deferred outflows of resources, liabilities, and deferred inflows of resources. The difference between assets, deferred outflows of resources, liabilities and deferred inflows of resources is reported as net position. Over time, increases and decreases in net position may provide an indication of whether the City’s financial position is improving or deteriorating. The statement of activities presents information reflecting how the City’s net position has changed during the fiscal year just ended. All changes in net position are reported as soon as the underlying event giving rise to the change occurs, regardless of the timing of the related cash flows. Thus, revenues and expenses are reported in this statement for some items that will only result in cash flows in future periods (e.g. uncollected taxes and earned but unused vacation leave). The government-wide financial statements distinguish functions of the City that are principally supported by taxes and intergovernmental revenues (governmental activities) from other functions that are intended to recover all or a significant portion of their costs through user fees and charges (business-type activities). The governmental activities of the City include general government, public safety, cultural, parks, recreation, and natural areas, planning and development services, transportation, and interest on long term debt. The business-type activities of the City include light and power, water, wastewater, storm drainage, and golf. 16 City of Fort Collins Comprehensive Annual Financial Report The government-wide financial statements also include the Fort Collins, Colorado Downtown Development Authority (DDA) as a discretely presented component unit of the City. See Note I.A in the notes to the City’s financial statements (page 50) for more details regarding the DDA and its relationship to the City. Fund Financial Statements. Traditional users of the City’s financial statements will find the fund financial statement presentation more familiar. The focus is now on major funds rather than fund types. 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. A major fund should generally meet both of the following criteria: 1) total assets, deferred inflows of resources, liabilities, deferred outflows of resources, revenues, or expenditures/expenses are at least 10% of the corresponding total (assets, liabilities, etc.) for that fund type (i.e., governmental or enterprise funds) and 2) total assets, deferred inflows of resources, liabilities, deferred outflows of resources, revenues, or expenditures/expenses of the individual governmental or enterprise fund are at least 5% of the corresponding total for all governmental and enterprise funds combined. The City, like other state and local governments, uses fund accounting to ensure and demonstrate compliance with finance-related legal requirements. All City funds can be divided into three categories: governmental funds, proprietary funds, and fiduciary funds. Governmental funds. Governmental funds are used to report those same functions reported as governmental activities in the government-wide financial statements. However, unlike the government-wide statements, the fund financial statements are prepared on the modified accrual basis of accounting. Under the modified accrual basis of accounting, revenues are recognized when they become measurable and available, and expenditures are recognized when the related fund liability is incurred, except for long-term debt and similar long-term items which are recorded when due. Therefore, the focus of the governmental fund financial statements is on near-term inflows and outflows of spendable resources as well as on the balance of spendable resources available at the end of the fiscal year. Since the focus of the governmental funds is on near-term resources, it is useful to compare the information presented for governmental funds with similar information presented for governmental activities in the government-wide financial statements. To facilitate this comparison, reconciliations are provided for both the governmental fund balance sheet and the governmental statement of revenues, expenditures, and changes in fund balances. 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, Keep Fort Collins Great, Urban Renewal Authority Fund, and the Capital Projects Fund. These four funds are major funds. Data from the other governmental funds is combined into a single, aggregated presentation. Individual fund data for each of these non- major funds is provided in the form of combining statements located within the supplementary information following the notes to the financial statements. The City adopts an annual appropriated budget for all of its governmental funds. A budgetary comparison statement has been provided to demonstrate compliance with this budget. The basic governmental fund financial statements can be found on pages 32-38 of this report. Proprietary funds. The City maintains two different types of proprietary funds, enterprise and internal service funds. The proprietary fund financial statements are prepared on the accrual basis of accounting. 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 light and power, water, wastewater, storm drainage and golf operations. Internal service funds are accounting devices used to accumulate and allocate costs internally among the City’s various functions. The City uses internal service funds to account for employee benefits provided by the City, its communications system, its fleet of vehicles and its self-insurance programs. These services predominantly benefit the governmental rather than business-type functions. As such, they have been included within the governmental activities in the government-wide financial statements. The activity in the Equipment Fund used for monitoring the fleet of vehicles is allocated between the governmental and business-type activities based upon actual usage. In City of Fort Collins Comprehensive Annual Financial Report 17 addition, the utilities use an internal service fund to account for customer and administrative services. Because this fund is used solely by the utilities, it is included within the business-type activities in the government-wide financial statements. Proprietary funds provide the same type of information as the government-wide financial statements, only in more detail. The Light and Power, Water, Wastewater and Storm Drainage enterprise funds are considered to be major funds and are therefore presented separately within the proprietary fund financial statements. The Golf Fund is presented as a non-major enterprise fund. All internal service funds are considered to be non-major funds and therefore are combined into a single, aggregated presentation in the proprietary fund statements. Individual fund data for each of the non-major proprietary funds is provided in the form of combining statements located within the supplementary information following the notes to the financial statements. The City adopts an annual appropriated budget for all of its proprietary funds. A budgetary comparison statement has been provided to demonstrate compliance with this budget. The basic proprietary fund financial statements can be found on pages 40-45 of this report. Fiduciary funds. The City maintains two different types of fiduciary funds, trust and agency funds. The fiduciary fund financial statements are prepared on the accrual basis of accounting. The fiduciary funds are used to account for resources held by the City in a trustee capacity or as an agent for the benefit of parties outside the government. Fiduciary funds are not reflected in the government-wide financial statements because the resources of those funds are not available to support the City’s own programs. The funds underlying each of the fiduciary fund types are combined into a single, aggregated presentation in the fiduciary fund statements. Individual fund data for each of the fiduciary funds is provided in the form of combining statements located within the supplementary information following the notes to the financial statements. Aside from the General Employees’ Retirement Plan Trust fund, the City does not adopt an annual appropriated budget for its fiduciary funds. A budgetary comparison statement for the General Employees’ Retirement Plan Trust fund has been provided to demonstrate compliance with the budget. The basic fiduciary fund financial statements can be found on pages 46-47 of this report. Notes to the Financial Statements. The notes to the financial statements are considered an integral part of the basic financial statements since they provide additional information needed to gain a full understanding of the data provided in both the government-wide and fund financial statements. The notes to the financial statements can be found on pages 49-95 of this report. Other Information. The City has elected to use the modified approach to account for and report its street infrastructure capital assets. The City has included required supplementary information that explains the modified approach and recent assessments that have been performed using the related asset management system. Information about the City’s pension and other post-employment benefit plan is also included as required supplemental information. These schedules can be found on pages 96-100 of this report. Combining Statements. The combining statements referred to earlier in connection with the non-major governmental funds, non-major enterprise fund, internal service funds, fiduciary funds, and the component unit funds are presented following the required supplementary information. In addition, budget statements for the Capital Projects Fund and the major enterprise funds are also presented following the required supplementary information. 18 City of Fort Collins Comprehensive Annual Financial Report Government-Wide Financial Analysis Statement of Net Position The following table reflects the condensed Statement of Net Position. For more detailed information see the Statement of Net Position on page 29 of this report. By far, the largest portion of the City’s net position, $1.5 billion (79.4%) is invested in capital assets (e.g., land, buildings, machinery and equipment), less any debt used to acquire those assets that is still outstanding. Net Capital assets increased by $81.8 million (5.7%) in 2017. 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 related debt, it should be noted that the resources needed to repay this debt must be provided from other sources since the capital assets themselves cannot be used to liquidate these liabilities. An additional portion of the City’s net position, $81.4 million (4.3%), represents resources that are subject to external restrictions on how they may be used. The remaining balance of unrestricted net position, $310.1 million (6.3%), may be used to meet the City’s ongoing obligations to its citizens and creditors. The City’s total net position increased by $76.9 million in 2017. Unrestricted net position decreased $5.0 million and was used to support core operations, maintain infrastructure, and invest in critical capital assets. Additional details of capital asset activity can be seen on page 25. 2017 2016 as restated 2017 2016 as restated 2017 2016 as restated Current and other assets $ 312,097 313,630 $ 174,728 $ 178,336 $ 486,825 $ 491,966 Capital assets 876,783 824,965 724,038 701,684 1,600,821 1,526,649 Total assets 1,188,880 1,138,595 898,766 880,020 2,087,646 2,018,615 Deferred outflows of resources 1,016 2,203 1,609 2,872 2,625 5,075 Other liabilities 25,764 28,915 20,534 25,369 46,298 54,284 Long-term liabilities 59,731 57,429 50,267 62,468 109,998 119,897 Total liabilities 85,495 86,344 70,801 87,837 156,296 174,181 Deferred inflows of resources 31,772 25,216 969 5 32,741 25,221 Net position: Net investment in capital assets 829,571 781,421 679,667 646,367 1,509,238 1,427,788 Restricted 81,844 80,520 - 859 81,844 81,379 Unrestricted 161,214 167,297 148,938 147,824 310,152 315,121 Total net position $ 1,072,629 1,029,238 $ 828,605 $ 795,050 $ 1,901,234 $ 1,824,288 Statement of Net Position as of December 31 (amounts expressed in thousands, totals may not add due to rounding) Governmental Activities Business-type Activities Total Primary Government City of Fort Collins Comprehensive Annual Financial Report 19 Changes in Net Position. The following table reflects a condensed summary of activities and changes in net position. For more detailed information see the Statement of Activities on pages 30-31 of this report. The above condensed summary of the City’s governmental and business type activities for the period ended December 31, 2017 reflects net position increasing by $76.9 million (4.0%). The prior period is also included for comparative purposes. In addition, revenue and expense graphs have been presented on pages 20-21 to enhance the reader’s understanding of the current year activities. 20 City of Fort Collins Comprehensive Annual Financial Report Governmental Activities: Sales & use taxes 47.8% Charges for services 17.2% Intergovernmental not restricted to programs 8.8% Property taxes 8.8% Capital grants and contributions 6.8% Operating grants and contributions 6.0% Occupational privilege taxes 1.0% Investment earnings 1.3% Lodging taxes 0.5% Other 1.5% 2017 Revenues by Source - Governmental Activities $283.8 million $- $10 $20 $30 $40 $50 $60 $70 $80 Millions Program Expenses Program Revenue 2017 Expenses Compared to Program Revenues - Governmental Activities City of Fort Collins Comprehensive Annual Financial Report 21 Business-type Activities: 22 City of Fort Collins Comprehensive Annual Financial Report Governmental activities. Governmental activities increased the City’s net position by $43.4 million, accounting for 56.4% of the City’s $76.9 million overall increase in net position. Major variations are due to the following: Transportation capital grants and contributions increased by $4.6 million in 2017 due to a receipt of $9.1 million in donated assets, and transportation operating grants increased $4.5 million over prior year. Charges for services were $4.3 million greater than last year mostly due to transportation Investment earnings of $3.8 million were $2.3 million more than the prior year primarily due to unrealized gains. The City’s investment portfolio is entirely composed of fixed-income securities and cash. Expenses in governmental activities increased $18.2 million over the prior year. Personnel costs in Police Services, Community Services, and Planning, Development and Transportation increased $5.0 million. Public safety expenditures increased $9 million as the City contributed $4 million more in 2017 than 2016 to support PFA services. Additionally, transportation expenditures increased $6.7 million as compared to prior year. Business-type activities. Business-type activities in the utility and golf funds increased the City’s net position by $33.6 million, accounting for 43.6% of the City’s $76.9 million increase in net position. Major variations are due to the following: Charges for services in the utilities business activities totaled $205.6 million for an increase of $6.7 million (3.4%) from 2016 to 2017. Light and Power services charges increased 3.0% year-over-year driven by a 3.45% rate increase while energy sales saw a modest decrease of .03%. Water operating revenues increased 4.0% compared to 2016 due a 5% rate increase. Wastewater operating revenues increased 2.7% from 2016 partially attributable to higher commercial demand as well as a 3.0% rate increase. Storm drainage operating revenue increased 7.2% compared to 2016 due to a 5% rate increase. Other Utility revenues remained consistent at $25.2 million in 2016 and 2017. Total Light and Power capital grant and contribution revenues decreased 13.7% in 2017 due to a slowdown in economic development. Total Water contributions and donations revenues increased 47.5% in 2017 for water rights redemptions that occurred at the end of the year. Wastewater capital remained consistent at approximately $3.8 million in 2017 as compared to 2016. Storm drainage capital contributions and donations revenue decreased by 17.1% compared to 2016 because of a slowdown in economic development. Investment earnings increased $1.3 million due to unrealized losses on the City’s hold-to-maturity portfolio. Business-type expenses totaled $193.8 million in 2017, an increase of $2.3 million compared to 2016. Light and Power expenses increased $1.5 million (1.1%). Purchased Power costs within Light and Power were up $2.2 million, construction costs up $2.7 million, efficiency rebates were down $408 thousand, and administrative costs, including PILOTs, decreased $879 thousand. Water expenses decreased $785 thousand (3.0%) mainly due to decreased debt service. Wastewater expenses increased $761 thousand (3.8%). Storm Drainage expenses increased $883 thousand (9.4%) due to increased contractual services City of Fort Collins Comprehensive Annual Financial Report 23 Financial Analysis of the City’s Funds As noted previously, the City uses fund accounting to ensure and demonstrate compliance with finance-related legal requirements. Governmental funds. The focus of the City’s governmental funds is to provide information on near-term inflows, outflows, and balances of spendable resources. Such information is useful in assessing the City’s financing requirements. In particular, unrestricted fund balance may serve as a useful measure of a government’s net resources available for spending at the end of the fiscal year. At December 31, 2017, the total Governmental fund balances were $207.7 million, a decrease of $3.7 million (1.7%) compared to the prior year. There was $6.5 million non-spendable, $80.2 million restricted, $50.9 million committed, $42.2 million assigned, and $27.7 million unassigned fund balance. The explanations for these restrictions are contained in the Notes to the Basic Financial Statements, section III.F on page 81. The Capital Projects Fund is used to account for financial resources to be used for the acquisition or construction of major capital facilities. The fund experienced a net decrease of $2.3 million which resulted in a December 31, 2017 fund balance of $17.6 million. Restricted fund balance was $11.3 million for voter approved projects and committed fund balance was $5.9 million. The largest capital project expenditures (expressed in millions) are shown in the table below. The General Fund is the chief operating fund of the City. At December 31, 2017, the total fund balance was $70.7 million. The spendable fund balance was $64.3 million. The General Fund decreased $4.6 million in 2016 compared to an increase of $2.4 million in 2016. The decrease is driven primarily by intentional use of reserves to fund activities such as the Information technology infrastructure project ($1.2 million), the police training facility ($1.1 million), and the police CAD and RMS Replacement CRISP ($1.0 million). The Keep Fort Collins Great Special Revenue Fund is another major governmental fund of the City. As of December 31, 2017, the total fund balance, the entirety of which is restricted to voter constraints, was $12.7 million. This is a decrease of $2.7 million due primarily to planned use of fund balances for both operations and capital expenditures. The Urban Renewal Authority Fund has the primary purpose of blight remedy by stimulating and leveraging private capital investment using tax increment financing in private development projects and public improvement projects. The December 31, 2017 fund balance was a deficit $5.1 million. The fund will continue to have a deficit fund balance for the foreseeable future as Tax Increment Funding (TIF) monies are collected through increased property tax collections. Current Year Life to Date Southeast Community Park $ 5.5 $ 16.0 Lincoln Avenue improvements-1st/Lemay 3.5 6.3 Lincoln Avenue Bridge 4.8 5.1 Prospect/College intersection improvements 1.9 2.6 24 City of Fort Collins Comprehensive Annual Financial Report Proprietary funds. The City’s proprietary funds provide the same type of information found in the government- wide financial statements, but in more detail. The unrestricted net position balances and the growth in net position of the City’s proprietary funds (including the major enterprise funds) are reflected in the following table. General Fund Budgetary Highlights The final budgeted lapsing expenditure appropriations were $8.7 million higher than the original budget lapsing appropriations. Revision to budget revenue appropriations are generally a product of unanticipated grant revenues and/or self-funded projects being appropriated. Major revisions to lapsing appropriations are summarized below: The 2017 ordinances created new budget appropriations for the following items: $.9 million for economic rebates, $1.5 million for payments to subrecipients, $1.2 million in 2017 unanticipated revenue or prior year reserve adjustments, and $4.1 million for purchase orders that were carried forward from 2016. The variance between actual lapsing expenditures and the final budget amounted to $12.4 million (8.4%) less than budget. Total lapsing expenditures of $148.3M were $10.2 million or 7.4% higher than in 2016. The decreased expenditures versus budget in the general fund were primarily due to the following: $6.8 million less than budget was spent on property services and $1.7 million less than budget was spent on professional and technical services across all service areas. The City expects to maintain its solid financial condition by continuous control over expenditures and through the evaluation of viable options for diversifying revenues. (amounts expressed in thousands, totals may not add due to rounding) Unrestricted Change in Net Position Net Position for Year Ended Proprietary Funds 12/31/2017 12/31/17 Light & Power $ 35,336 $ 3,529 Water 66,047 16,815 Wastewater 40,335 7,886 Storm Drainage 19,742 6,816 Total of Major Enterprise Funds 161,460 35,046 Other Enterprise Fund - Golf 803 345 Total Enterprise Funds 162,263 35,391 Internal Service Funds 16,918 2,146 Total Proprietary Funds $ 179,181 $ 37,537 Change in Net Position - Proprietary Funds City of Fort Collins Comprehensive Annual Financial Report 25 Capital Asset and Debt Administration Capital Assets. The City’s investment in capital assets for its governmental and business-type activities as of December 31, 2017 amounted to $1.6 billion (net of accumulated depreciation). This was an increase of $74.2 million (4.9%). This investment in capital assets includes land, water rights, buildings and improvements, machinery, equipment, and light and power, water, wastewater and storm drainage infrastructure as well as street system infrastructure. The City has elected to use the modified approach for infrastructure reporting of its street system infrastructure. The City completes assessments of its entire street system on a three-year cycle. The most recent three-year assessment was completed as of December 31, 2015. It resulted in a Pavement Condition Index (PCI) rating of 72. It met the City’s policy of achieving a good (Level of Service B) rating. For 2017, the City spent $19.1 million on its street maintenance program as compared to $18.7 million, the asset management system estimate needed to maintain streets at Level of Service B. For more detailed information, see the Required Supplementary Information on pages 99-100 of this report. Major capital improvements during this fiscal year included the following: Additional information on the City’s capital assets can be found in Note III.C on pages 68-69 of this report. Governmental Business-type Total Activities Activities Primary Government 2017 2016 2017 2016 2017 2016 Land, rights of way, water rights, other $ 236,303 $ 226,063 $ 73,215 $ 70,833 $ 309,518 $ 296,896 Street system infrastructure 347,891 326,038 - - 347,891 326,038 Construction in progress 40,655 31,155 97,243 124,720 137,898 155,875 Infrastructure 14,470 14,966 - - 14,470 14,966 Buildings and improvements 99,846 92,717 120,472 125,308 220,318 218,025 Improvements other than buildings 107,908 104,336 401,867 353,332 509,775 457,668 Machinery and equipment 29,709 29,690 31,240 27,353 60,949 57,043 Total capital assets $ 876,782 $ 824,965 $ 724,037 $ 701,546 $ 1,600,819 $ 1,526,511 (amounts expressed in thousands, totals may not add due to rounding) Capital Assets Net of Depreciation as of December 31 Governmental Activities Firehouse Alley parking structure $ 8.4 million Lincoln Avenue bridge 4.8 million Lincoln Avenue improvements 1st to Lemay 3.8 million Open space improvements 3.0 million Proprietary Activities Meters $ 19.1 million Underground conduit 10.9 million Michigan Ditch repairs 7.4 million Underground conductors and devices 6.6 million 26 City of Fort Collins Comprehensive Annual Financial Report Long-term debt. At the end of the current fiscal year, the City had total debt outstanding of $88.7 million (bonds, certificates of participation, capital leases, etc.). This was a decrease of $6.5 million (6.9%). Of this amount, $48.8 million represents bonds secured by specified revenue sources (i.e., revenue bonds). The remaining $40.0 million represents debt primarily secured by the new facilities or equipment being financed by certificates of participation, assignment of lease payments or capital leases. Additional information on the City’s long-term obligations can be found in Note III.E on pages 71-80 of this report. Requests for Information The City’s financial statements are designed to provide users with a general overview of the City’s finances and to demonstrate the City’s accountability. Questions concerning any of the information presented in this report or requesting additional information should be sent to the Accounting Director’s attention at the following address: Accounting Director 215 North Mason Street 2nd Floor PO Box 580 Fort Collins, CO 80522-0580 Outstanding Debt as of December 31 (amounts expressed in thousands) Governmental Business-type Total Activities Activities Primary Government 2017 2016 2017 2016 2017 2016 Revenue bonds $ 8,860 $ 9,435 $ 39,960 $ 49,838 $ 48,820 $ 59,273 Certificates of participation 29,410 25,365 225 425 29,635 25,790 Assignment of lease payments 249 304 790 966 1,039 1,270 Capital leases 8,463 8,190 749 720 9,212 8,910 Total outstanding debt $ 46,982 $ 43,294 $ 41,724 $ 51,949 $ 88,706 $ 95,243 BASIC FINANCIAL INFORMATION City of Fort Collins Comprehensive Annual Financial Report 27 BASIC FINANCIAL STATEMENTS 28 City of Fort Collins Comprehensive Annual Financial Report THIS PAGE INTENTIONALLY LEFT BLANK City of Fort Collins Comprehensive Annual Financial Report 29 STATEMENT OF NET POSITION DECEMBER 31, 2017 Primary Government -- City of Fort Collins Governmental Business-type Component Activities Activities Total Unit ASSETS Cash and cash equivalents $ 40,397,904 $ 23,934,628 $ 64,332,532 $ 505,701 Investments 188,339,360 136,518,757 324,858,117 2,939,561 Receivables: Property taxes 29,423,967 - 29,423,967 6,389,568 Sales and use taxes 14,059,986 - 14,059,986 - Accounts, net 10,593,835 20,554,110 31,147,945 6,385 Notes - 1,219,745 1,219,745 - Interest 670,794 474,860 1,145,654 10,497 Prepaid 353,764 - 353,764 - Internal Balances 13,625,711 (13,625,711) - - Due from other governments - 14,153 14,153 - Inventories of materials and supplies 644,126 5,631,105 6,275,231 - Inventory of real property held for resale 1,477,894 - 1,477,894 135,464 Restricted cash and cash equivalents 2,555,001 6,542 2,561,543 - Restricted investments - - - 1,250,000 Investment in joint venture 9,954,299 - 9,954,299 - Capital assets (non-depreciable) 624,902,300 170,458,359 795,360,659 2,528,747 Capital assets (net of accumulated depreciation) 251,880,273 553,579,443 805,459,716 2,434,152 Total assets 1,188,879,214 898,765,991 2,087,645,205 16,200,075 DEFERRED OUTFLOWS OF RESOURCES Deferred loss on refunding 1,016,016 1,609,483 2,625,499 - LIABILITIES Accounts payable 13,010,378 16,773,292 29,783,670 94,776 Interest payable 165,577 131,603 297,180 17,099 Wages payable 4,230,106 1,516,412 5,746,518 19,164 Compensated absences 6,668,210 2,106,238 8,774,448 15,424 Due to other governments 120,400 - 120,400 - Unearned revenue 1,223,633 - 1,223,633 - Deposits held 345,802 5,671 351,473 - Non-current liabilities Due within one year 11,491,430 9,637,445 21,128,875 2,053,122 Due in more than one year 48,239,603 40,629,999 88,869,602 8,025,235 Total liabilities 85,495,139 70,800,660 156,295,799 10,224,820 DEFERRED INFLOWS OF RESOURCES Property taxes 29,423,967 - 29,423,967 6,389,568 Unearned revenue - other 1,330,892 - 1,330,892 - Deferred gain on refunding 2,570 1,569 4,139 - Other pension-related items 1,014,121 967,850 1,981,971 Total deferred inflows of resources 31,771,550 969,419 32,740,969 6,389,568 NET POSITION Net investment in capital assets 829,570,967 679,667,176 1,509,238,143 4,962,899 Restricted for: Debt service 2,554,504 - 2,554,504 1,377,675 Capital projects 32,335,233 - 32,335,233 - Donations and grants 1,773,341 - 1,773,341 - Parks and natural areas 19,486,271 - 19,486,271 Development agreements 3,330,718 - 3,330,718 - Emergencies 6,914,703 - 6,914,703 - Other 15,449,139 - 15,449,139 Unrestricted (deficit) 161,213,665 148,938,219 310,151,884 (6,754,887) Total Net Position (Deficit) $ 1,072,628,541 $ 828,605,395 $ 1,901,233,936 $ (414,313) The notes to the financial statements are an integral part of this statement. 30 City of Fort Collins Comprehensive Annual Financial Report STATEMENT OF ACTIVITIES FOR THE YEAR ENDED DECEMBER 31, 2017 Program Revenues Operating Capital Charges for Grants and Grants and Expenses Services Contributions Contributions FUNCTIONS/ PROGRAM ACTIVITIES: Primary Government: Governmental Activities: General government $ 45,431,357 $ 15,785,563 $ 834,439 $ 978,065 Public safety 73,945,372 1,603,477 1,209,035 1,012,174 Culture, parks, recreation and natural areas 44,396,017 10,673,421 943,779 8,323,846 Planning and development 20,594,284 4,561,147 2,993,203 1,651,553 Transportation 58,290,089 16,279,724 11,032,818 7,413,737 Interest on long-term debt 1,254,681 - - - Total Governmental Activities 243,911,800 48,903,332 17,013,274 19,379,375 Business-type Activities: Light & Power 133,285,179 130,198,357 - 5,490,709 Water 25,598,046 31,105,789 - 10,837,818 Wastewater 20,958,486 24,102,167 - 4,411,039 Storm Drainage 10,804,588 16,807,054 - 1,088,473 Golf 3,142,229 3,473,908 - - Total Business-type Activities 193,788,528 205,687,275 - 21,828,039 Total Primary Government 437,700,328 254,590,607 17,013,274 41,207,414 Component Unit: Downtown Development Authority $ 2,831,655 $ 73,431 $ 80,674 $ - The notes to the financial statements are an integral part of this statement. City of Fort Collins Comprehensive Annual Financial Report 31 Net (Expense) Revenue and Changes in Net Position Primary Government - City of Fort Collins Governmental Business-type Component Activities Activities Total Unit $ (27,833,290) $ $ (27,833,290) $ (70,120,686) (70,120,686) (24,454,971) (24,454,971) (11,388,381) (11,388,381) (23,563,810) (23,563,810) (1,254,681) (1,254,681) (158,615,819) (158,615,819) 2,403,887 2,403,887 16,345,561 16,345,561 7,554,720 7,554,720 7,090,939 7,090,939 331,679 331,679 - 33,726,786 33,726,786 (158,615,819) 33,726,786 (124,889,033) (2,677,550) General Revenues Sales & use taxes 135,621,328 - 135,621,328 - Property taxes 25,097,457 - 25,097,457 5,282,773 Occupational privilege taxes 2,974,186 - 2,974,186 - Lodging taxes 1,520,567 - 1,520,567 - Intergovernmental not restricted to programs 25,074,123 225,524 25,299,647 - Investment earnings 3,826,303 2,219,678 6,045,981 55,686 Miscellaneous 4,387,219 887,676 5,274,895 50,621 Transfers 3,504,975 (3,504,975) - - Total general revenues and transfers 202,006,158 (172,097) 201,834,061 5,389,080 Changes in Net Position 43,390,339 33,554,689 76,945,028 2,711,530 Net Position (Deficit)--January 1 as restated 1,029,238,202 795,050,706 1,824,288,908 (3,125,843) Net Position (Deficit)--December 31 $ 1,072,628,541 $ 828,605,395 $ 1,901,233,936 $ (414,313) 32 City of Fort Collins Comprehensive Annual Financial Report GOVERNMENTAL FUNDS BALANCE SHEET DECEMBER 31, 2017 Primary Government Keep Urban Total Fort Collins Capital Renewal Other Total General Great Projects Authority Governmental Governmental ASSETS Cash and cash equivalents $ 11,857,189 $ 1,526,050 $ 2,846,372 $ 204,846 $ 16,674,682 $ 33,109,139 Investments 48,266,216 8,951,897 16,614,423 1,185,106 93,236,089 168,253,731 Receivables Property taxes 23,837,669 - - 5,255,531 330,767 29,423,967 Sales and use taxes 8,734,644 2,852,413 - - 2,472,929 14,059,986 Accounts, net 939,121 - 942,799 - 8,506,456 10,388,376 Interest 179,978 32,383 53,180 3,479 327,606 596,626 Prepaid item - - - - 89,322 89,322 Due from other funds 786,132 - - - - 786,132 Advances to other funds 4,882,399 - - - 1,017,606 5,900,005 Inventory of real property held for resale 1,477,894 - - - - 1,477,894 Restricted - cash and cash equivalents - - 497 953,644 - 954,141 Total Assets 100,961,242 13,362,743 20,457,271 7,602,606 122,655,457 265,039,319 LIABILITIES Accounts payable, accruals, and other 3,610,355 386,435 2,281,397 521,590 4,954,849 11,754,626 Wages payable 2,365,218 245,049 19,466 4,859 1,218,879 3,853,471 Due to other governments 107,692 - - - 12,708 120,400 Due to other funds - - - - 786,132 786,132 Unearned revenue - - - - 1,223,633 1,223,633 Advance from other funds - - - 6,917,610 - 6,917,610 Deposits held 20,000 - - - 325,802 345,802 Total Liabilities 6,103,265 631,484 2,300,863 7,444,059 8,522,003 25,001,674 DEFERRED INFLOWS OF RESOURCES Unavailable revenue - property taxes 23,837,669 - - 5,255,531 330,767 29,423,967 Unavailable revenue - grants 280,391 - 535,551 - 834,318 1,650,260 Unavailable revenue - other - - - - 1,330,892 1,330,892 Total Deferred Inflows of Resources 24,118,060 - 535,551 5,255,531 2,495,977 32,405,119 Total Liabilities and Deferred Inflows of Resources 30,221,325 631,484 2,836,414 12,699,590 11,017,980 57,406,793 FUND BALANCES (DEFICIT) Nonspendable 6,485,293 - - - 89,322 6,574,615 Restricted 12,050,803 12,731,259 11,736,482 968,927 42,755,578 80,243,049 Committed 375,452 - 5,884,375 - 44,631,553 50,891,380 Assigned 17,909,053 - - - 24,315,991 42,225,044 Unassigned 33,919,316 - - (6,065,911) (154,967) 27,698,438 Total Fund Balances (Deficit) 70,739,917 12,731,259 17,620,857 (5,096,984) 111,637,477 207,632,526 Total Liabilities, Deferred Inflows of Resources and Fund Balances (Deficit) $ 100,961,242 $ 13,362,743 $ 20,457,271 $ 7,602,606 $ 122,655,457 $ 265,039,319 The notes to the financial statements are an integral part of this statement. City of Fort Collins Comprehensive Annual Financial Report 33 RECONCILIATION OF THE BALANCE SHEET OF GOVERNMENTAL FUNDS TO THE STATEMENT OF NET POSITION DECEMBER 31, 2017 Amounts reported for governmental activities in the statement of net position (page 29) are different because: Total fund balances - governmental funds (page 32) $ 207,632,526 Capital assets of $1,046,323,921 net of accumulated depreciation of $178,908,787 used in governmental activities are not financial resources, therefore, are not reported in the funds. 867,415,134 City's joint venture equity interest in Fort Collins/Loveland Airport. 9,954,299 Other long-term assets are not available to pay for current-period expenditures and, therefore, are reported as a deferred inflow of resources in the funds. 1,650,260 Internal service fund allocated to business type activities 14,643,318 Long-term liabilities are not due and payable in the current period and therefore are not reported in funds: Bonds payable (8,860,000) Certificates of Participation (29,410,000) Assignment of lease (248,577) Premium (229,966) Capital lease - Deferred loss on refunding, net of deferred gain 1,013,446 Interest payable (141,379) Compensated absences (6,049,751) Net pension liability (4,933,850) Total OPEB liability (146,784) (49,006,861) Deferred outflow of resources, other pension-related items (871,736) Internal service funds are used by management to charge the costs of certain activities to individual funds. Except for the utility customer service and administrative fund, the assets/deferred ouflows of resources and liabilities/deferred inflows of resources of the internal service funds are included in the governmental activities in the statement of net position. 21,211,601 Net position of governmental activities (page 29) $ 1,072,628,541 34 City of Fort Collins Comprehensive Annual Financial Report GOVERNMENTAL FUNDS STATEMENT OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCES (DEFICIT) FOR THE YEAR ENDED DECEMBER 31, 2017 Primary Government Keep Urban Total Fort Collins Capital Renewal Other Total General Great Projects Authority Governmental Governmental REVENUES Taxes $ 109,330,572 $ 27,413,695 $ - $ 3,622,048 $ 24,847,223 $ 165,213,538 Licenses and permits 3,809,880 - - - 312,127 4,122,007 Intergovernmental 14,052,239 - 4,269,911 - 29,692,252 48,014,402 Fees and charges for services 9,506,463 - - - 32,898,652 42,405,115 Fines and forfeitures 2,033,894 - - - - 2,033,894 Earnings on investments 1,159,928 211,352 239,680 24,224 1,624,636 3,259,820 Miscellaneous revenue 1,424,505 486 2,238,489 - 1,506,340 5,169,820 Total Revenues 141,317,481 27,625,533 6,748,080 3,646,272 90,881,230 270,218,596 EXPENDITURES Current Police services 36,927,099 4,914,950 - - 2,368 41,844,417 Financial services 4,360,932 - - - - 4,360,932 Community services 12,485,988 3,830,886 702,099 - 21,367,838 38,386,811 Planning, development and transportation 8,856,489 13,912,953 3,259,017 - 44,192,071 70,220,530 Executive, legislative, and judicial 6,815,336 16,215 - - - 6,831,551 Information and employee 17,298,851 257,242 39,510 - 5,805 17,601,408 Sustainability services 6,727,816 1,954,166 10,722 4,523,331 3,241,745 16,457,780 Other 1,695,009 - - - 80,541 1,775,550 Intergovernmental Fire protection 24,012,449 3,362,292 - - 1,631,089 29,005,830 Capital outlay 4,022,277 2,103,009 29,825,637 - 10,670,852 46,621,775 Debt service Principal - - - 575,000 4,174,658 4,749,658 Interest and debt service costs 497 1,955 - 698,319 453,923 1,154,694 Total Expenditures 123,202,743 30,353,668 33,836,985 5,796,650 85,820,890 279,010,936 Excess of Revenues Over (Under) Expenditures 18,114,738 (2,728,135) (27,088,905) (2,150,378) 5,060,340 (8,792,340) OTHER FINANCING SOURCES (USES) Transfers in 1,678,411 - 16,677,421 - 28,335,693 46,691,525 Transfers out (25,967,493) (20,500) (321,487) - (25,711,631) (52,021,111) Debt Debt issued - - 8,425,000 - - 8,425,000 Sale of capital assets 1,539,481 - - - 479,916 2,019,397 Total Other Financing Sources (Uses) (22,749,601) (20,500) 24,780,934 - 3,103,978 5,114,811 Net Changes in Fund Balances (Deficit) (4,634,863) (2,748,635) (2,307,971) (2,150,378) 8,164,318 (3,677,529) Fund Balances (Deficit)-January 1 75,374,780 15,479,894 19,928,828 (2,946,606) 103,473,159 211,310,055 Fund Balances (Deficit)-December 31 $ 70,739,917 $ 12,731,259 $ 17,620,857 $ (5,096,984) $ 111,637,477 $ 207,632,526 The notes to the financial statements are an integral part of this statement. City of Fort Collins Comprehensive Annual Financial Report 35 RECONCILIATION OF THE STATEMENT OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCES (DEFICIT) OF GOVERNMENTAL FUNDS TO THE STATEMENT OF ACTIVITIES FOR THE YEAR ENDED DECEMBER 31, 2017 Amounts reported for governmental activities in the statement of activities (pages 30-31) are different because: Net change in fund balances - total governmental funds (page 34) $ (3,677,529) 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 capital outlays, $56,293,176, exceeded depreciation, $15,178,571, in the current period. 41,114,605 The net effect of disposal of capital assets Donations 9,083,543 Disposal (95,123) 8,988,420 Revenues in the statement of activities that do not provide current financial resources are not reported as revenues in the governmental funds. (5,068,124) The issuance of long-term debt (e.g., bonds, leases) provides current financial resources to the governmental funds. However, issuing debt increases long-term liabilities on the statement of net position, so this transaction has no effect on net position. Also, governmental funds report the effect of premiums, discounts, and similar items as expenditures in the period when the debt is created. However, these amounts are deferred and amortized in the statement of activities. Principal payments 4,749,658 Debt payment made by DDA on behalf of the City 260,609 Debt issued (8,425,000) Amortization of premium, deferred amount of refunding (88,424) Capital lease obligation transferred to Internal Service Funds 2,512,632 Interest expense (54,092) (1,044,617) In the statement of activities, certain expenses - compenstated absences, other post-employment benefits and pension expense - are measured by the amounts incurred during the year. In the governmental funds, however, expenditure for these items are measured by the amount of financial resources used or due (essentially, the amounts actually paid). These amounts represent the net effect of compenstated absences, other post-employment benefits and pension-releated amounts on the statement of activities. Change in net pension liability 1,447,441 Change in postemployment healthcare benefits 4,054 Change in compensated absences (374,998) 1,076,497 Expenses in Statement of Activities related to City's Equity in Joint Venture Change in Non-Capital Equity position in Fort Collins/Loveland Airport (186,119) Change in deferred outflow of resources, other pension-related items (1,795,432) Allocation of internal service fund net position to business type activities 1,109,524 Internal service funds are used by management to charge the costs of certain activities to individual funds. Except for the utility customer service and administrative fund, the net revenue of the internal service funds is reported with the governmental activities. 2,873,114 Change in net position of governmental activities (pages 30-31) $ 43,390,339 The notes to the financial statements are an integral part of this statement. 36 City of Fort Collins Comprehensive Annual Financial Report GENERAL FUND (CONSOLIDATED) STATEMENT OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCES-- ACTUAL AND BUDGET (NON-GAAP BUDGETARY BASIS) FOR THE YEAR ENDED DECEMBER 31, 2017 Original Final Actual Budget Budget Variance REVENUES Programs Taxes $ 109,330,572 $ 114,394,906 $ 110,194,564 $ (863,992) Licenses and permits 3,809,880 3,592,509 3,592,509 217,371 Intergovernmental 13,085,276 13,936,752 13,936,752 (851,476) Fees and charges for services 9,506,463 9,240,938 9,657,610 (151,147) Fines and forfeitures 2,033,894 2,127,000 2,127,000 (93,106) Earnings on investments 1,159,928 1,136,989 1,136,989 22,939 Miscellaneous revenue 1,423,505 1,080,135 1,111,597 311,908 Sale of capital assets 899,312 - 9,779 889,533 Sale of assets held for resale 640,169 - - 640,169 Transfers 2,813,018 1,634,053 2,361,002 452,016 Projects Intergovernmental 3,786,324 - 5,522,396 (1,736,072) Miscellaneous revenue 344,672 - 306,993 37,679 Transfers 496,160 - 2,500,000 (2,003,840) Total Revenues 149,329,173 147,143,282 152,457,191 (3,128,018) EXPENDITURES Programs (fund level of budgetary control) Community and operation 13,260,528 13,823,792 15,061,431 1,800,903 Employee and communications 23,152,082 24,369,661 25,948,630 2,796,548 Executive, legislative, and judicial 6,739,941 6,579,829 6,948,388 208,447 Financial services 4,360,932 4,652,418 4,734,954 374,022 Fire protection 24,012,449 24,012,449 24,012,449 - Other 23,387,444 23,109,128 23,361,551 (25,893) Planning, development and transportation 9,895,314 10,888,472 11,312,685 1,417,371 Police services 38,207,102 41,194,534 42,603,253 4,396,151 Sustainability services 6,300,022 4,747,561 8,117,312 1,817,290 Projects (project level of budgetary control) Community and operation 416,062 - 434,693 18,631 Employee and communications - - 20,000 20,000 Executive, legislative, and judicial 373,015 - 438,820 65,805 Planning, development and transportation 392,803 - 477,201 84,398 Police services 2,164,686 - 3,005,709 841,023 Sustainability services 1,141,395 - 1,488,267 346,872 Other 1,815,429 - 5,621,841 3,806,412 Total Expenditures 155,619,204 153,377,844 173,587,184 17,967,980 Excess of revenues over (under) expenditures (6,290,031) $ (6,234,562) $ (21,129,993) $ 14,839,962 RECONCILIATION TO GAAP BASIS Prior Years' Project Expenses 5,314,361 Prior Years' Project Revenues (3,659,193) Total Reconciling Items 1,655,168 Net Change in Fund Balances (4,634,863) Fund Balances--January 1 75,374,780 Fund Balances--December 31 $ 70,739,917 The notes to the financial statements are an integral part of this statement. City of Fort Collins Comprehensive Annual Financial Report 37 KEEP FORT COLLINS GREAT FUND STATEMENT OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCES-- ACTUAL AND BUDGET (NON-GAAP BUDGETARY BASIS) FOR THE YEAR ENDED DECEMBER 31, 2017 Original Final Actual Budget Budget Variance REVENUES Programs Earnings on investments $ 211,352 $ 192,487 $ 192,487 $ 18,865 Miscellaneous revenue 486 - - 486 Taxes 27,413,695 26,326,347 27,982,153 (568,458) Total Revenues 27,625,533 26,518,834 28,174,640 (549,107) EXPENDITURES Programs (fund level of budgetary control) Fire Protection 3,379,797 2,821,897 3,379,504 (293) Other Community Priorities 4,070,198 4,092,186 5,221,386 1,151,188 Other Street and Transportation 2,007,099 2,009,485 2,274,671 267,572 Parks and Recreation 3,353,792 3,447,729 3,964,471 610,679 Police services 5,010,380 5,326,602 5,545,352 534,972 Street Maintenance 8,972,812 8,987,696 8,987,696 14,884 Projects (project level of budgetary control) Capital Maintenance 5,229,992 - 5,415,530 185,538 City Bridge Program 6,277,722 - 8,318,156 2,040,434 Dial-A-Ride Operations 837,394 - 837,394 - FC Bikes 519,680 - 568,819 49,139 Safe Routes to School 1,206,991 - 1,316,000 109,009 Senior Center Expansion 947,177 - 960,971 13,794 Trail Acquisition & Development 653,537 - 827,000 173,463 Total Expenditures 42,466,571 26,685,595 47,616,950 5,150,379 Excess of revenues over (under) expenditures (14,841,038) $ (166,761) $ (19,442,310) $ 4,601,272 RECONCILIATION TO GAAP BASIS Prior Years' Project Expenses 12,092,403 Total Reconciling Items 12,092,403 Net Change in Fund Balances (2,748,635) Fund Balances--January 1 15,479,894 Fund Balances--December 31 $ 12,731,259 The notes to the financial statements are an integral part of this statement. 38 City of Fort Collins Comprehensive Annual Financial Report URBAN RENEWAL AUTHORITY (CONSOLIDATED) STATEMENT OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCES (DEFICIT)-- ACTUAL AND BUDGET (NON-GAAP BUDGETARY BASIS) FOR THE YEAR ENDED DECEMBER 31, 2017 Original Final Actual Budget Budget Variance REVENUES Programs Taxes 3,622,048 5,990,392 5,990,392 (2,368,344) Earnings on investments 24,224 102,811 102,811 (78,587) Proceeds from issuance of long-term debt - 2,503,939 2,503,939 - Total Revenues 3,646,272 8,597,142 8,597,142 (2,446,931) EXPENDITURES Programs (fund level of budgetary control) Debt & Other Uses 1,425,906 3,950,151 3,950,151 2,524,245 Other Purchased Services 16,010 8,883 8,883 (7,127) Personnel Costs 127,173 110,022 110,022 (17,151) Purchased Prof & Tech Services 159,564 193,074 198,073 38,509 Purchased Property Services 4,220,037 4,065,629 4,065,629 (154,408) Supplies 547 1,000 1,000 453 Total Expenditures 5,949,237 8,328,759 8,333,758 2,384,521 Excess of revenues over (under) expenditures (2,302,965) $ 268,383 $ 263,384 $ (62,410) RECONCILIATION TO GAAP BASIS Principal Reduction--Advances Payable 152,587 Total Reconciling Items 152,587 Net Change in Fund Balances (Deficit) (2,150,378) Fund Balances (Deficit)--January 1 (2,946,606) Fund Balances (Deficit)--December 31 $ (5,096,984) The notes to the financial statements are an integral part of this statement. City of Fort Collins Comprehensive Annual Financial Report 39 THIS PAGE INTENTIONALLY LEFT BLANK 40 City of Fort Collins Comprehensive Annual Financial Report PROPRIETARY FUNDS STATEMENT OF NET POSITION DECEMBER 31, 2017 Light Storm and Power Water Wastewater Drainage ASSETS Current Assets Cash and cash equivalents $ 4,127,484 $ 9,282,485 $ 6,158,589 $ 3,114,448 Investments 24,074,490 54,527,776 36,149,956 18,279,898 Receivables Accounts, net 14,020,951 2,295,822 2,527,611 1,685,192 Interest 81,146 189,562 125,348 62,933 Prepaid item - - - - Due from other governments - - - 14,153 Inventories of materials and supplies 5,631,105 - - - Total Current Assets 47,935,176 66,295,645 44,961,504 23,156,624 Non-Current Assets Advance to other funds - 1,017,606 - - Restricted - cash and cash equivalents - - 6,542 - Land, water rights, other 1,762,311 56,762,217 3,423,833 8,385,780 Buildings, improvements and equipment 315,001,250 296,902,132 242,713,519 136,409,408 Accumulated depreciation (163,540,320) (137,144,861) (99,941,003) (41,030,627) Construction in progress 23,458,196 39,406,949 13,721,719 20,656,044 Note receivable 1,219,745 - - - Total Non-Current Assets 177,901,182 256,944,043 159,924,610 124,420,605 Total Assets 225,836,358 323,239,688 204,886,114 147,577,229 DEFERRED OUTFLOWS OF RESOURCES Deferred charge on refunding - 12,939 1,311,510 285,034 LIABILITIES Current Liabilities Accounts payable 11,462,705 1,411,150 999,881 2,605,643 Interest payable 21,308 12,933 64,410 25,120 Wages payable 446,986 328,217 224,991 125,015 Compensated absences 723,635 456,432 321,160 175,363 Bonds payable 1,740,000 2,480,742 1,905,000 2,830,000 Claims payable - - - - Capital lease obligations 23,746 - - - Total Current Liabilities 14,418,380 4,689,474 3,515,442 5,761,141 Non-Current Liabilities Postemployment benefits 994,939 1,426,050 1,406,541 410,541 Bonds payable 3,712,436 1,257,843 22,422,855 6,612,325 Claims payable - - - - Capital lease obligations 61,533 - - - Deposits held - 5,671 - - Total Non-Current Liabilities 4,768,908 2,689,564 23,829,396 7,022,866 Total Liabilities 19,187,288 7,379,038 27,344,838 12,784,007 DEFERRED INFLOWS OF RESOURCES Deferred gain on refunding - - - - Other pension-reletated items 169,307 251,961 243,652 72,536 Total Deferred Inflows of Resources 169,307 251,961 243,652 72,536 NET POSITION Net investment in capital assets 171,143,722 249,575,038 138,274,311 115,263,313 Restricted: fiscal agent - - - - Unrestricted 35,336,041 66,046,590 40,334,823 19,742,407 Total Net Position $ 206,479,763 $ 315,621,628 $ 178,609,134 $ 135,005,720 Adjustment to reflect the consolidation of internal service fund net position related to enterprise funds: Allocation of governmental activities related to internal service fund net position: Net position of business-type activities (page 29). The notes to the financial statements are an integral part of this statement. City of Fort Collins Comprehensive Annual Financial Report 41 Non Major Enterprise Fund Enterprise Internal Golf Funds Service Funds $ 208,825 $ 22,891,831 $ 8,331,562 1,099,432 134,131,552 22,472,834 19,346 20,548,922 210,647 3,815 462,804 86,224 - - 264,442 - 14,153 - - 5,631,105 644,126 1,331,418 183,680,367 32,009,835 - 1,017,606 - - 6,542 1,600,860 2,881,310 73,215,451 30,126 9,241,920 1,000,268,229 25,821,859 (5,247,852) (446,904,663) (16,268,669) - 97,242,908 - - 1,219,745 - 6,875,378 726,065,818 11,184,176 8,206,796 909,746,185 43,194,011 - 1,609,483 - 129,269 16,608,648 1,420,396 7,832 131,603 24,199 37,245 1,162,454 730,593 76,480 1,753,070 971,627 - 8,955,742 - - - 3,337,035 657,957 681,703 3,042,535 908,783 29,293,220 9,526,385 235,521 4,473,592 1,874,345 - 34,005,459 - - - 3,296,101 1,020,937 1,082,470 5,420,319 - 5,671 - 1,256,458 39,567,192 10,590,765 2,165,241 68,860,412 20,117,150 1,569 1,569 - 41,613 779,069 331,166 43,182 780,638 331,166 5,194,915 679,451,299 4,226,559 - - 1,600,860 803,458 162,263,319 16,918,276 $ 5,998,373 841,714,618 $ 22,745,695 1,534,094 (14,643,318) $ 828,605,394 42 City of Fort Collins Comprehensive Annual Financial Report PROPRIETARY FUNDS STATEMENT OF REVENUES, EXPENSES AND CHANGES IN FUND NET POSITION FOR THE YEAR ENDED DECEMBER 31, 2017 Light Storm and Power Water Wastewater Drainage OPERATING REVENUES Charges for services $ 128,730,192 $ 30,772,056 $ 23,949,484 $ 16,755,272 Other revenue 1,925,171 389,042 159,849 208,335 Total Operating Revenues 130,655,363 31,161,098 24,109,333 16,963,607 OPERATING EXPENSES Personnel services 10,459,859 7,592,012 5,611,900 2,708,037 Contractual services 11,560,054 4,747,999 3,983,850 1,945,744 Commodities 91,471,848 1,840,707 1,301,947 192,034 Customer service and administrative charges 5,832,953 2,941,511 2,607,355 2,426,866 Other 3,432,567 1,321,744 866,158 297,312 Depreciation 10,325,278 6,955,095 5,940,856 2,716,948 Total Operating Expenses 133,082,559 25,399,068 20,312,066 10,286,941 Operating Income (Loss) (2,427,196) 5,762,030 3,797,267 6,676,666 NONOPERATING REVENUES (EXPENSES) Earnings on investments 522,721 786,963 552,614 328,330 Intergovernmental 225,524 - - - Gain (loss) on sale of capital assets 211,437 95,023 11,765 (124,998) Interest expense (258,998) (239,799) (675,311) (532,696) Total Nonoperating Revenues (Expenses) 700,684 642,187 (110,932) (329,364) Income (Loss) Before Contributions and Transfers (1,726,512) 6,404,217 3,686,335 6,347,302 Capital contributions 5,490,709 10,837,818 4,411,039 1,088,475 Assumption of capital lease liability - - - - Transfers in - - - 2,556 Transfers out (235,226) (426,813) (210,986) (622,718) Change in Net Position 3,528,971 16,815,222 7,886,388 6,815,615 Net Position--January 1 as restated 202,950,792 298,806,406 170,722,746 128,190,105 Net Position--December 31 $ 206,479,763 $ 315,621,628 $ 178,609,134 $ 135,005,720 Adjustment to reflect the consolidation of internal service fund net position related to enterprise funds: Allocation of governmental activities related to internal service fund net position: Change in net position of business-type activities (pages 30-31) The notes to the financial statements are an integral part of this statement. City of Fort Collins Comprehensive Annual Financial Report 43 Non Major Enterprise Fund Enterprise Internal Golf Funds Service Funds $ 3,435,768 $ 203,642,772 $ 59,238,283 44,598 2,726,995 4,544,042 3,480,366 206,369,767 63,782,325 1,365,155 27,736,963 19,350,893 999,887 23,237,534 39,512,120 336,538 95,143,074 4,937,546 - 13,808,685 - 26,246 5,944,027 1,084,456 328,330 26,266,507 1,782,390 3,056,156 192,136,790 66,667,405 424,210 14,232,977 (2,885,080) 16,090 2,206,718 274,841 - 225,524 142,143 3,319 196,546 152,844 (37,241) (1,744,045) (199,103) (17,832) 884,743 370,725 406,378 15,117,720 (2,514,355) - 21,828,041 190,880 - - (2,414,547) - 2,556 9,295,915 (61,078) (1,556,821) (2,412,062) 345,300 35,391,496 2,145,831 5,653,073 20,599,864 $ 5,998,373 $ 22,745,695 (727,283) (1,109,524) $ 33,554,689 44 City of Fort Collins Comprehensive Annual Financial Report PROPRIETARY FUNDS STATEMENT OF CASH FLOWS FOR THE YEAR ENDED DECEMBER 31, 2017 Light and Power Water Wastewater Storm Drainage CASH FLOWS FROM OPERATING ACTIVITIES Cash received from customers and users $ 128,739,304 $ 30,811,454 $ 23,841,470 $ 16,726,031 Receipts from interfund services provided - - - - Cash paid to employees for services (10,332,394) (7,453,046) (5,469,508) (2,657,955) Cash paid to other suppliers of goods & services (113,582,739) (12,098,140) (8,921,668) (7,033,231) Other receipts 1,925,171 389,042 159,849 208,335 Net cash provided (used) by operating activities 6,749,342 11,649,310 9,610,143 7,243,180 CASH FLOWS FROM NONCAPITAL FINANCING ACTIVITIES Transfers from other funds - - - 2,556 Transfers to other funds (235,226) (426,813) (210,986) (622,718) Advances from other funds - 1,634,364 - - Net cash provided (used) by noncapital financing activities (235,226) 1,207,551 (210,986) (620,162) CASH FLOWS FROM CAPITAL AND RELATED FINANCING ACTIVITIES Proceeds from capital debt - - - - Capital contributions 5,490,709 10,467,630 4,411,039 1,088,475 Purchases of capital assets (15,228,249) (13,801,074) (11,253,371) (7,975,508) Principal paid on capital debt (1,756,530) (2,744,464) (2,123,451) (3,595,000) Interest paid on capital debt (302,584) (221,677) (548,735) (475,272) Proceeds from sales of capital assets (4,126) 465,212 (4,297) 27,926 Grant proceeds from federal government 225,524 - - 65,191 Net cash (used) by capital and related financing activities (11,575,256) (5,834,373) (9,518,815) (10,864,188) CASH FLOWS FROM INVESTING ACTIVITIES Payments received for note receivable 90,469 4,903 - - Sale (Purchase) of investments 6,434,984 (2,169,521) 2,994,250 5,363,527 Earnings received on investments 542,453 773,214 557,401 344,105 Net cash provided (used) by investing activities 7,067,906 (1,391,404) 3,551,651 5,707,632 Net (decrease) in cash and cash equivalents 2,006,766 5,631,084 3,431,993 1,466,462 Cash and cash equivalents, January 1 2,120,718 3,651,404 2,733,138 1,647,984 Cash and cash equivalents, December 31 $ 4,127,484 $ 9,282,488 $ 6,165,131 $ 3,114,446 Reconciliation of operating income (loss) to net cash provided (used) by operating activities: Operating income (loss) (2,427,196) 5,762,030 3,797,267 6,676,666 Adjustments to reconcile operating income (loss) to net cash provided by operating activities: Depreciation expense 10,325,278 6,955,095 5,940,856 2,716,948 (Increase) decrease in accounts receivable 9,112 39,398 (108,014) (29,241) (Increase) decrease in inventories 135,736 - - - (Increase) decrease in prepaid item - - - - (Increase) decrease in pension-related items 348,706 518,940 688,410 149,396 Increase (decrease) in accounts payable (1,421,053) (1,246,179) (162,358) (2,171,275) Increase (decrease) in compensated absences payable 35,010 7,934 31,998 11,227 Increase (decrease) in post-employment benefits (282,134) (418,359) (591,905) (120,440) Increase (decrease) in wages payable 25,883 30,451 13,889 9,899 Increase (decrease) in claims payable - - - - Net cash provided (used) by operating activities $ 6,749,342 $ 11,649,310 $ 9,610,143 $ 7,243,180 Noncash investing, capital, and financing activities: Capital contributions - 370,188 - - Reconciliation of cash and cash equivalents to City of Fort Collins Comprehensive Annual Financial Report 45 Non Major Enterprise Fund Total Total Internal Golf Enterprise Funds Service Funds $ 3,438,341 $ 203,556,600 $ - - - 59,332,252 (1,352,075) (27,264,978) (19,118,702) (1,337,071) (142,972,849) (45,271,455) 44,598 2,726,995 4,544,042 793,793 36,045,768 (513,863) - 2,556 9,295,915 (61,078) (1,556,821) (2,412,062) - 1,634,364 - (61,078) 80,099 6,883,853 292,440 292,440 3,396,700 - 21,457,853 190,880 (326,018) (48,584,220) (3,444,596) (616,067) (10,835,512) (3,025,803) (41,603) (1,589,871) (191,540) 3,318 488,033 143,200 - 290,715 142,143 (687,930) (38,480,562) (2,789,016) - 95,372 - 62,663 12,685,903 (949,698) 16,184 2,233,357 261,870 78,847 15,014,632 (687,828) 123,632 12,659,937 2,893,146 85,193 10,238,437 7,039,278 $ 208,825 $ 22,898,374 $ 9,932,424 424,210 14,232,977 (2,885,080) 328,330 26,266,507 1,782,390 2,573 (86,172) 93,969 - 135,736 (11,143) - - 4,615 85,706 1,791,158 682,071 25,600 (4,975,265) (54,121) 884 87,053 79,319 (69,095) (1,481,933) (549,875) (4,415) 75,707 20,676 - - 323,316 $ 793,793 $ 36,045,768 $ (513,863) - 370,188 - 208,825 22,891,831 8,331,562 - 6,542 1,600,860 $ 208,825 $ 22,898,373 $ 9,932,422 46 City of Fort Collins Comprehensive Annual Financial Report FIDUCIARY FUNDS STATEMENT OF FIDUCIARY NET POSITION DECEMBER 31, 2017 General Employee Agency Retirement Plan Funds ASSETS Cash and cash equivalents $ 2,491,850 $ 3,566,141 Receivables, interest 67,123 67,414 Investments US Government securities 10,410,072 16,542,469 Corporate bonds 1,724,452 2,740,298 Mutual funds 34,114,235 - Total Investments 46,248,759 19,282,767 Total Assets 48,807,732 22,916,322 LIABILITIES Amounts held for other governments - 22,916,322 Total Liabilities $ - $ 22,916,322 NET POSITION Net position restricted for pensions $ 48,807,732 The notes to the financial statements are an integral part of this statement. City of Fort Collins Comprehensive Annual Financial Report 47 FIDUCIARY FUNDS STATEMENT OF CHANGES IN FIDUCIARY NET POSITION FOR THE YEAR ENDED DECEMBER 31, 2017 General Employee Retirement Plan ADDITIONS Contributions Employer contributions $ 1,652,786 Total Contributions 1,652,786 Investment income Interest related to plan investments 208,422 Net change in fair value of investments 6,824,288 Total Investment Income 7,032,710 Total Additions 8,685,496 DEDUCTIONS Benefit payments 3,720,322 Administration expense 26,752 Total Deductions 3,747,074 Net Increase in Plan Net Position 4,938,422 Net Position Beginning of year 43,869,310 End of year $ 48,807,732 The notes to the financial statements are an integral part of this statement. 48 City of Fort Collins Comprehensive Annual Financial Report THIS PAGE INTENTIONALLY LEFT BLANK NOTES City of Fort Collins Comprehensive Annual Financial Report 49 NOTES TO THE BASIC FINANCIAL STATEMENTS I. Summary of Significant Accounting Policies A. Reporting Entity .................................................................................................................. 50 B. Joint Ventures. ..................................................................................................................... 50 C. Jointly Governed Organization ........................................................................................... 51 D. Undivided Interest ............................................................................................................... 51 E. Government-wide and Fund Financial Statements ............................................................. 51 F. Measurement Focus and Basis for Accounting .................................................................. 52 G. Financial Statement Presentation ........................................................................................ 52 H. Assets, Liabilities, Deferred Outflows/Inflows of Resources and Net Position/Fund Balance ......................................................................... 54 II. Stewardship, Compliance and Accountability A. Budgetary Information ........................................................................................................ 59 B. Deficit Fund Balance and Net Position ............................................................................... 60 C. Tax Abatements.................................................................................................................... 60 III. Detailed Notes on All Funds A. Deposits and Investments .................................................................................................... 63 B. Notes Receivable ................................................................................................................. 67 C. Capital Assets ...................................................................................................................... 68 D. Inter-fund Transfers and Advances ..................................................................................... 70 E. Long-term Obligations ........................................................................................................ 71 F. Fund Balances. ..................................................................................................................... 80 IV. Other Information A. Risk Management ............................................................................................................... 81 B. Employee Retirement Systems and Pension Plans .............................................................. 82 C. Other Postemployment Benefits .......................................................................................... 88 D. Presentation of Postemployment Benefit Obligations ........................................................ 91 E. Commitments and Contingencies ........................................................................................ 92 F. Legal Matters ....................................................................................................................... 92 G. Related Party Transactions. ................................................................................................. 93 H. Subsequent Events……………………………………………………………………........95 50 City of Fort Collins Comprehensive Annual Financial Report NOTE I. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES The City of Fort Collins, Colorado (the City) was incorporated in 1873 and adopted its Home Rule charter in 1913. In 1954, the citizens adopted the Council-Manager form of government. The more significant accounting policies reflected in the financial statements are summarized as follows: A. Reporting Entity These financial statements include those of the City (primary government) and organizations for which the City is financially accountable (component units). The following component units are included in the reporting entity: The Fort Collins, Colorado Downtown Development Authority (DDA); City of Fort Collins General Improvement District No. 1 (GID No. 1); the Fort Collins Capital Leasing Corporation (Corporation); the Urban Renewal Authority (URA); and the City of Fort Collins General Improvement District No. 15-Skyview (GID No. 15- Skyview). None of the component units issue their own financial statements. The DDA was created in 1981 by City Council and the electorate. The purpose of the DDA is to promote the public health, safety, prosperity, security, and welfare of its inhabitants. The City appoints and removes all members of the DDA's governing board in addition to issuing debt, adopting budgets, and levying taxes on its behalf. The financial statements of the Downtown Development Authority are included in the reporting entity by discrete presentation. GID No. 1 was created in 1976 for the construction and installation of parking facilities and street and sidewalk beautification improvements. GID No. 1 is, in substance, the same as the primary government since the City Council serves as the board of directors. As such, it levies all taxes, approves all budgets, and issues all debt on behalf of GID No. 1. Accordingly, its transactions and balances are blended with those of the City. GID No. 1 is presented as a special revenue fund. The Corporation was created in June 1998 and operates under the provisions of the Nonprofit Corporation Law of the State of Colorado. The Corporation’s primary purpose is to provide financing assistance by obtaining land, property and equipment on behalf of the City. The directors are appointed by the City Council and receive no compensation. Its transactions and balances are blended with those of the City. The Corporation is presented as a debt service fund. The URA was established in 2006. The primary purpose of the URA is to remedy blight by stimulating and leveraging private capital investment, using tax increment financing in private development projects and public improvement projects. The URA is, in economic substance and governance for reporting purposes, the same as the primary government because the City Council serves as the board of directors. Management of the primary government, reporting to elected officials of the primary government, has operational responsibility for the URA and is charged with day-to-day operations. Its transactions and balances are blended with those of the City. The URA is presented as a special revenue fund. GID No. 15-Skyview was organized in 1997 by Larimer County and was inherited by the City as part of the Southwest Annexation. The mill levy funds are used to maintain the street system for the Skyview Subdivision. GID No. 15-Skyview is, in substance, the same as the primary government since the City Council serves as the board of directors. As such, it levies all taxes, approves all budgets, and issues all debt on behalf of GID No. 15- Skyview. Accordingly, its transactions and balances are blended with those of the City. GID No. 15-Skyview is presented as a special revenue fund. B. Joint Ventures The City has joined with other governmental units to form the following joint ventures: The Northern Colorado Regional Airport was created for the purpose of operating a municipal airport for the benefit of the citizens of Loveland and Fort Collins. The City provides a small amount of funding for on-going airport City of Fort Collins Comprehensive Annual Financial Report 51 construction projects. The City and Loveland each retain a 50% ownership interest in the airport. Separately issued financial statements are available upon request from the Airport Manager. North Front Range Metropolitan Planning Organization (NFRMPO) is an association of local governments that was formed in 1988 in response to local needs and federal transportation and air quality planning requirements. Local government membership consists of elected officials representing Fort Collins, Greeley, Loveland, Evans, Berthoud, Windsor, Timnath, Garden City, LaSalle, Johnstown, Eaton, Milliken, Severance and Weld and Larimer Counties. Membership is also extended to the Colorado Transportation Commission and the Colorado Air Quality Control Commission. The NFRMPO Planning Council appoints its own management and approves its own budget. Separately issued financial statements are available upon request from the Planning Council. Poudre Fire Authority (PFA) was created by an intergovernmental agreement between the City of Fort Collins and the Poudre Valley Fire Protection District. The PFA Board consists of five members: two appointed by City Council, two appointed by the District's Board of Directors and a fifth member appointed by the other four members. The PFA Board appoints its own management and approves its own budget. PFA's continuing existence depends, in part, on funding provided by the City. Separately issued financial statements for PFA are available from its administrative office. Platte River Power Authority (PRPA) was created by an intergovernmental agreement between the Cities of Fort Collins, Estes Park, Loveland, and Longmont to supply their wholesale electric power and energy requirements. The governing Board of PRPA consists of two members from each municipality. Under Colorado law, PRPA's Board of Directors has the exclusive authority to establish electric rates. The City has contracted for its total electric energy supply from PRPA through December 31, 2040. Separately issued financial statements for PRPA are available from its corporate headquarters. Aside from the Airport (see Note IV, G. 1.), the City does not have an equity interest in any of the joint ventures in which it participates. None of the joint ventures are accumulating financial resources or are experiencing fiscal stress that are expected to create a significant financial benefit or burden on the City in the foreseeable future. C. Jointly Governed Organization The City and various governmental entities throughout Larimer County have jointly agreed to establish the Larimer Emergency Telephone Authority (LETA). LETA is a separate legal entity established to provide E-911 telephone service to the citizens of Larimer County. The City does not retain an on-going financial interest or responsibility in LETA. D. Undivided Interest The City completed construction of the Fort Collins Museum of Discovery (the “Museum”) in November 2012 with the partnership of Discovery Center, a Colorado non-profit corporation. In January 2013, in accordance with the partnership agreement, the City granted a shared ownership of the property to Discovery Center. The two entities now jointly operate the museum where visitors from the northern Colorado region and surrounding areas can experience interactive exhibits and educational programs of a broad spectrum of relevant topics. The financial transactions of the City for the Museum are reported as a sub-fund of the General Fund. E. Government-wide and Fund Financial Statements The government-wide financial statements (i.e., the statement of net position and the statement of activities) report information on all of the non-fiduciary activities of the primary government and its component units. The effect of inter-fund activity has been removed from these statements. Governmental activities, which are normally supported by taxes and intergovernmental revenues, are reported separately from business-type activities, which rely primarily on fees and charges for support. Also, the primary government is reported separately from the DDA, a legally separate component unit for which the primary government is financially accountable. The statement of activities demonstrates the degree to which the direct expenses of a given function or segment is 52 City of Fort Collins Comprehensive Annual Financial Report offset by program revenues. Direct expenses are those that are clearly associated with a specific function or segment. Program revenues include 1) charges to customers or applicants who purchase, use or directly benefit from goods, services, or privileges provided by a given function or segment and 2) grants and contributions that are restricted to meeting the operational or capital requirements of a particular function or segment. Taxes and other items not properly included among program revenues are reported instead as general revenues. Separate financial statements are provided for governmental funds, proprietary funds, and fiduciary funds, even though the latter are excluded from the government-wide financial statements. Major individual governmental funds and major individual enterprise funds are reported as separate columns in the fund financial statements. F. Measurement Focus and Basis of Accounting The government-wide financial statements are reported using the economic resources measurement focus and the accrual basis of accounting, as are the proprietary funds and the pension trust fund. The agency funds utilize the accrual basis of accounting but have no measurement focus. Revenues are recorded when earned and expenses are recorded when a liability is incurred, regardless of the timing of related cash flows. Property taxes are recognized as revenues in the year for which they are levied. Grants and similar items are recognized as revenue as soon as all eligibility requirements have been met. An allowance for doubtful accounts is maintained for the utility receivables. Governmental fund financial statements are reported using the current financial resources measurement focus and the modified accrual basis of accounting. Revenues are recognized as soon as they are both measurable and available. Revenues are considered to be available when they are collectible within the current period or soon enough thereafter to pay liabilities of the current period. For this purpose, the City considers revenues to be available if they are collected within 60 days of the end of the current fiscal period. As under accrual accounting, expenditures are generally recorded when a liability is incurred. However, debt service expenditures, as well as those related to compensated absences, pension liabilities, and incurred claims and judgments, are recorded only when payment is due. With regard to self-insurance claims and judgments, an additional expenditure may be recorded based on actuarial information. Property taxes, special assessments, sales taxes, franchise taxes, charges for services, amounts due from other governments and interest associated with the current fiscal period are all considered to be subject to accrual. Other revenue items such as licenses, fines and permits are considered to be measurable and available only when the cash is received by the City; as a result, they are not subject to accrual. G. Financial Statement Presentation The accounts of the City are organized and operated on the basis of funds, each of which is considered a separate accounting entity. The operations of each fund are accounted for with a separate set of self-balancing accounts that comprise its assets, liabilities, deferred inflows/outflows of resources, fund balance or net position, revenues and expenditures or expenses as appropriate. The various funds are summarized by type within the financial statements. The City reports the following major governmental funds: The General Fund is the City’s primary operating fund. It accounts for all financial resources of the general government, except those required to be accounted for in another fund. City of Fort Collins Comprehensive Annual Financial Report 53 Keep Fort Collins Great fund, a special revenue fund, is used to account for collections of the City’s 0.85% sales and use tax which is allocated as follows: 33% for street maintenance and repair 17% for other street and transportation needs 17% for police services 11% for fire protection and other emergency services 11% for parks maintenance and recreation services 11% for community priorities other than those listed above, as determined by the City Council. The Capital Projects Fund is used to account for financial resources to be used for the acquisition or construction of major capital facilities. URA, a special revenue fund, is used to account for the tax increment financing for the operations and debt services of the Urban Renewal Authority, a blended component unit. The City reports the following major proprietary funds: Light and Power fund is used to account for the operations of the City’s electric utility. Water fund is used to account for the operation of the City’s water utility. Wastewater fund is used to account for the operation of the City’s wastewater utility. Storm Drainage fund is used to account for the operations of the City’s storm water utility. Additionally, the City reports the following fund types: Internal Service funds are used to account for the City’s fleet maintenance services, technology and communication, self- insurance of employee health care and other employee benefits, and a risk management insurance program. There is also an internal service fund to account for the customer and administrative services provided exclusively to the City’s utility enterprise funds. Pension Trust fund is used to account for the City’s General Employees’ Retirement Plan, a defined benefit pension plan to provide retirement benefits for its employees/retirees. Agency funds are used to account for cash and investments held by the City on behalf of Poudre Fire Authority and Poudre River Public Library District. As a general rule, the effect of inter-fund activity has been eliminated from the government-wide financial statements. Exceptions to this rule are the charges between the City’s utility functions and various other functions. Elimination of these charges would distort the direct costs and program revenues reported for the various functions concerned. Proprietary funds distinguish operating revenues and expenses from non-operating 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 water and storm drainage funds also recognize as operating revenue the portion of connection fees intended to recover the cost of connecting new customers to the system. Operating expenses for enterprise and internal service funds include the cost of sales and services, administrative expenses, and depreciation on capital assets. 54 City of Fort Collins Comprehensive Annual Financial Report H. Assets, Liabilities, Deferred Outflows/Inflows of Resources, and Net Position/Fund Balance Cash and Investments The City has stated certain investments at fair value in accordance with GASB Statement No. 72. Fair value is the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. Fair value is a market-based measurement, not an entity-specific measurement. For some assets and liabilities, observable market transactions or market information might be available; for others, it might not be available. However, the objective of a fair value measurement in both cases is the same--that is, to determine the price at which an orderly transaction to sell the asset or to transfer the liability would take place between market participants at the measurement date under current market conditions. Fair value is an exit price at the measurement date from the perspective of a market participant that controls the asset or is obligated for the liability. Whenever possible, cash is pooled from the various City funds to enhance investment capabilities and maximize investment income. Investments are made taking into consideration cash flow needs, market conditions, and contingency plans. The City's investment policies prescribe eligible investments, investment diversification, and maturity and liquidity guidance, which are utilized in managing the investment portfolio. For purposes of the combined statement of cash flows, the City considers highly liquid investments with a maturity of three months or less when purchased, including external investment pools, to be cash equivalents. Receivables Accounts receivable are expressed net of allowances for doubtful accounts. Light and Power Fund maintains an allowance of $225,000, Water Fund maintains an allowance of $25,000, Wastewater Fund maintains an allowance of $20,000, and Storm Drainage Fund has an allowance of $10,000. Long-term portions of receivables in the governmental fund financial statements are reported and then offset by non-spendable, restricted and committed fund balance reserve accounts to indicate that they are not available or spendable resources. Inventories Inventories are stated at cost using the first-in, first-out method. The costs of inventory items are recognized as expenditures in governmental funds when purchased and as expenses in proprietary funds when used. Where appropriate, inventory has been adjusted downward to market value to reflect what is considered a permanent market decline. Inventory of Real Property Held for Resale Inventory of real property held for resale generally reflects the cost of raw land for development of affordable housing held by the City’s Land Bank Program in the General Fund. These assets are carried at the lower of cost or fair value. Capital Assets Capital assets, which are acquired or constructed, are reported at historical cost in the applicable governmental or business-type activities’ columns in the government-wide and proprietary fund financial statements. Capital assets are defined by the City as assets with an initial, individual cost of more than $5,000 and an estimated useful life of five years or greater. Donated capital assets are recorded at estimated acquisition value at the date of donation. City of Fort Collins Comprehensive Annual Financial Report 55 Capital assets other than land, construction in progress, water rights, and some intangible property are depreciated. Depreciation is computed using the straight-line method with estimated useful lives as follows: Buildings ………………………………….………………………………………………………. 10 - 50 years Improvements other than buildings ….……………………………………………………………... 5 - 50 years Machinery and equipment ………………………………………………………….……………...... 5 - 20 years GASB Statement No. 34 provides for an alternative approach to depreciation for measuring the value of infrastructure assets and the related costs incurred to maintain their service life at a locally established minimum standard. In order to adopt this alternative method, the City has developed an asset management system, which will determine if the minimum standards are being maintained. This measurement would occur every three years at a minimum. The City has elected to use this alternative method for reporting its street infrastructure capital assets. Deferred Outflows/Inflows of Resources In addition to assets, the financial statements will sometimes report a separate section for deferred outflows of resources. This separate financial statement element, deferred outflows of resources, represents a consumption of net position that applies to a future period(s) and so will not be recognized as an outflow of resources (expense/expenditure) until then. In addition to liabilities, the financial statements will sometimes report a separate section for deferred inflows of resources. This separate financial statement element, deferred inflows of resources, represents an acquisition of net position that applies to a future period(s) and so will not be recognized as an inflow of resources (revenue) until that time. The City reports deferred outflows/inflows of resources as follows: Gain/Loss on Refunding - In the government-wide and proprietary funds statement of net position, deferred outflows/inflows of resources on refunding represent the difference in the carrying value of refunded debt and its reacquisition price. The difference is amortized and recognized over the remaining life of the old refunded debt or the new refunding debt, whichever is shorter. Unavailable Revenues - Unavailable revenue is reported in the governmental funds balance sheet. The governmental funds report unavailable revenues from three sources: property taxes, grants and parking tickets. These amounts are deferred and recognized as an inflow of resources in the period that the amounts become available. In the government-wide Statement of Net Position, only property tax revenue is reported as a deferred inflow of resources and will be recognized as revenue in the year for which they are levied. Pension-Related Amounts – In the government-wide and proprietary funds statement of net position, a deferred inflow of resources is reported for the unrecognized items not yet charged to pension expense related to the net pension liability, such as the unamortized portion of the net difference projected and actual earnings on pension plan investments and other differences between expected and actual experience. Deferred inflows for the net difference between projected and actual investment earnings are recognized over a period of five years, while the deferred outflow for the differences between expected and actual experience for economic/demographic assumptions are recognized over the average remaining service life for all active and inactive members. Compensated Absences The City allows employees to accumulate unused vacation pay and to defer overtime pay by accumulating compensatory leave up to maximum limits. The liability associated with these benefits is reported in the government-wide financial statements. Proprietary fund types accrue such benefits in the period in which they are earned. The entire portion is current, as employees typically use the full balance in the subsequent year and the City records usage on a first in, first out basis. A liability for the amount is reported in governmental funds only if they have matured, for example as a result of employee resignations and retirements. Unused sick pay is not recognized as a liability because it does not meet the criteria for accrual. 56 City of Fort Collins Comprehensive Annual Financial Report Long-Term Obligations In the government-wide financial statements and proprietary 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 position. Bond premiums and discounts are deferred and amortized over the life of the bonds using the straight-line method. Bonds payable are reported net of the applicable bond premium or discount. Issuance costs, whether or not withheld from the actual debt proceeds received, are reported as expenses in the period they are incurred. In the 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. Claims and Judgments Payable Claims and judgments payable are recognized when it is probable that a liability has been incurred and the amount of the loss can be reasonably estimated. Such claims, including an estimate for claims incurred but not reported at year end, are reflected as claims payable in the financial statements. Pension The net pension liability and deferred inflows of resources, pension expense and information about the fiduciary net position of the General Employee Retirement Plan (GERP) and additions to/deductions from the fiduciary net position has been determined on the same basis as they are reported by GERP. For this purpose, benefit payments are recognized when due and payable in accordance with benefit terms. Investments are reported at fair value. Fund Balance/Net Position GASB Statement No. 54 Fund Balance Reporting and Governmental Fund Type Definitions establishes fund balance classifications that comprise a hierarchy based on the extent to which a government is bound to observe constraints imposed upon the use of the resources reported in the governmental funds. In the fund financial statements, fund balance of the City’s governmental funds is classified as nonspendable, restricted, committed, assigned, or unassigned. Nonspendable fund balances indicate amounts that cannot be spent such as permanent endowments or assets in non-liquid form. It also includes the long-term amount of advances, loans and notes receivables as well as property held for resale unless the proceeds from the collection of these items would be considered restricted, committed, or assigned in which case they are included in those categories. Restricted fund balances indicate amounts constrained for a specific purpose by external parties, constitutional provision or enabling legislation. Committed fund balances indicate amounts constrained for a specific purpose by the City Council, which is the City’s highest level of decision-making authority. Amounts are established, modified and rescinded only through a Council approved ordinance. The ordinance must occur prior to year-end; however, the amount can be determined in the subsequent period. Assigned fund balances indicate amounts the City intends to be used for specific purposes, but do not meet the criteria to be classified as restricted or committed. The City Manager, Chief Financial Officer and Controller are authorized to assign fund balance as outlined in the fund balance policy. City of Fort Collins Comprehensive Annual Financial Report 57 Unassigned fund balance is the residual classification for the government’s general fund and includes all spendable amounts not included in the other classifications. In other funds, the unassigned classification is used to report a deficit fund balance. When unassigned and restricted, committed, or assigned fund balances are available for use, it is the City’s policy to use restricted, committed, or assigned resources before unassigned resources. In the government-wide and proprietary fund financial statements, net positions are restricted for amounts that are legally restricted by outside parties for specific purposes or through enabling legislation that is a legally enforceable restriction on the use of revenues. When both restricted net position and unrestricted net position are available for use, it is the City’s policy to use restricted-net position first and then unrestricted net position. Investment in capital assets consists of capital assets, net of accumulated depreciation, reduced by the outstanding balances of any borrowings used for the acquisition, construction or improvements of those assets. The government-wide statement of net position reports $81,843,909 of restricted net position, of which $39,249,936 is restricted by enabling legislation. Minimum Fund Balance Policy It is the City’s policy to maintain a 60 Day Liquidity Goal minimum unassigned fund balance in the General Fund. Minimum unassigned fund balance should be at least 17% of the subsequent year’s originally adopted budgeted expenditures and transfers out, excluding expenditures and transfers out for large and unusual one-time items. The 60 Day Liquidity Goal is in addition to the restricted balance required by Article X, Section 20 of the State Constitution. Inter-fund Transactions Inter-fund transactions are treated and classified as revenues, expenditures, or expenses (the same as if these same transactions involved external organizations). These include billings from one fund to another for purchased goods or services as well as payment in lieu of taxes. In the government-wide statement of activities, transactions, which constitute reimbursements, are eliminated except for transfers between governmental and business-type activities. 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 amounts reported in the financial statements and accompanying notes. Actual results could differ from those estimates. Discretely Presented Component Units The significant accounting policies for the City's discretely presented component unit are substantially the same as the primary government. Additional disclosures follow. The discretely presented component unit data presented in the government-wide statements includes total data for all fund types of the Downtown Development Authority (DDA), including its General Fund, Debt Service Fund and its non-current assets and liabilities. The Board of Directors of the DDA approves their respective budget by resolution. The budget is then submitted to City Council for approval. Budgetary matters with respect to basis of accounting and legal level of budgetary control are generally the same for the DDA as those of the City. 58 City of Fort Collins Comprehensive Annual Financial Report Adoption of New Accounting Pronouncements Effective January 1, 2017, the City adopted GASB Statement 75, Accounting and Financial Reporting for Postemployment Benefits Other Than Pensions. GASB 75 requires a liability for other postemployment benefits (OPEB) obligations, known as the Net OPEB Liability (Total OPEB Liability for unfunded plans), to be recognized on the balance sheets of participating funds. Changes in the Net OPEB Liability (Total OPEB Liability for unfunded plans) are immediately recognized as OPEB expense on the income statement or reported as deferred inflows/outflows of resources depending on the nature of the change. As this statement is applied retroactively, the financial statements for the year ended December 31, 2016 have been restated to apply the changes associated with the implementation of GASB Statement No. 75 to adjust the total OPEB liability. The effect of this change is as follows: The GASB has issued several statements not yet implemented by the City. City management has not yet determined the effect the Statements will have on the financial statements. However, the City intends to implement all standards by the required dates. The Standards which may impact the City are as follows: GASB Statement No. 84, Fiduciary Activities. This Statement, issued January 2017, will be effective for the City beginning with its fiscal year ending December 31, 2019. This Statement establishes criteria for identifying fiduciary activities of all state and local governments. The focus of the criteria generally is on (1) whether a government is controlling the assets of the fiduciary activity and (2) the beneficiaries with whom a fiduciary relationship exists. Separate criteria are included to identify fiduciary component units and postemployment benefit arrangements that are fiduciary activities. GASB Statement No. 87, Leases, issued June 2017, will be effective for the City beginning with its fiscal year ending December 31, 2020, with earlier adoption encouraged. Statement No. 87 establishes a single approach to accounting for and reporting leases by state and local governments. Under this statement, a government entity that is a lessee must recognize (1) a lease liability and (2) an intangible asset representing the lessee’s right to use the leased asset. In addition, the City must report the (1) amortization expense for using the asset over the shorter of the term of the lease or the useful life of the underlying asset, (2) interest expense on the lease liability and (3) note disclosures about the lease. The Statement provides exceptions from the single-approach for short-term leases, financial purchases, leases of assets that are investments and certain regulated leases. This statement also addresses accounting for lease terminations and modifications, sale-leaseback transactions, nonlease components embedded in lease contracts (such as service agreements), and leases with related parties. GASB Statement No. 88, Certain Disclosures Related to Debt, including Direct Borrowings and Direct Placement, issued March 2018, will be effective for the City beginning with its fiscal year ending December 31, 2019, with earlier adoption encouraged. Statement No. 88 clarifies which liabilities governments should include in their note disclosures related to debt. This statement defines debt that must be disclosed in the notes of the financial statements as a liability that arises from contractual obligation to pay cash in one or more payments to settle an amount that is fixed at the date the contractual obligation is established. Governments must also disclose amounts of unused lines of credits, asset pledges as collateral for debt and the terms specified in the debt agreements related to significant events of default with finance-related consequences, termination events with finance-related consequences, and subjective acceleration clauses. Within the notes, governments should separate information regarding direct borrowings and direct placements of debt from other debt. Governmental Business-type Activities Activities Light and Power Wastewater Net position December 31, 2016, as previously reported $ 1,028,243,092 $ 373,238,178 $ 202,702,015 $ 170,536,163 Total OPEB liability (150,838) (65,992) (37,710) (28,282) Removal of net OPEB obligation 1,145,948 501,353 286,488 214,865 Net position January 1, 2017, as restated $ 1,029,238,202 $ 373,673,539 $ 202,950,793 $ 170,722,746 Enterprise Funds City of Fort Collins Comprehensive Annual Financial Report 59 NOTE II. STEWARDSHIP, COMPLIANCE, AND ACCOUNTABILITY A. Budgetary Information Budgetary Accounting and Control Appropriated budgets are established for all funds of the City except agency funds, which do not measure results of operations. General, Special Revenue, Debt Service and Trust Funds Budgets for general, special revenue, debt service and trust funds are not adopted on a basis consistent with generally accepted accounting principles (GAAP). The exceptions to GAAP are appropriations for grants and capital projects that do not lapse until the grant or project is completed. Capital Project Funds Budgets for the Capital Project Funds are not consistent with GAAP because appropriations do not lapse on an annual basis as explained below. Proprietary Funds Proprietary funds are budgeted on a basis that includes capital items such as amounts for capital outlay and principal reduction of debt. Such budgets exclude depreciation, bond amortization, and changes in estimates such as claim reserves or post-employment liabilities. Capital project budgets for certain enterprise funds do not lapse on an annual basis as explained below. Legal Level of Control The legal level of budgetary control is at the individual fund level, except for capital projects, the URA, and federal and state grants for which the legal level of control is at the project, tax increment financing district, or grant level. For budgetary purposes, operating transfers are considered expenditures. Lapsing Appropriations All appropriations unexpended or unencumbered lapse at the end of the year to the applicable fund, except capital project and federal and state grant appropriations which lapse when the project or grant activity is completed. Appropriations which are legally encumbered at year end are carried over to the ensuing year at which time they are matched with their corresponding expenditures. Budgets for the Capital Projects Fund, special revenue funds with expenditures of a capital or project nature and special revenue funds where the primary source of revenue is project-length federal or state grants are non- lapsing. Included are the Capital Projects Fund, Neighborhood Parkland Fund, Conservation Trust Fund, Community Development Block Grant Fund, Home Program Fund, Transit Services Fund, the grant portion of Transportation Services, Community Capital Improvement Program Fund, and the capital project portion of the Keep Fort Collins Great Fund. Budgets are non-lapsing for capital projects in all the enterprise funds and for one of the internal service funds - Utilities Customer Service and Administration Fund. 60 City of Fort Collins Comprehensive Annual Financial Report Property Taxes Property taxes levied in a particular year are collected in the subsequent year. The property tax calendar is as follows: Tax Year Tax levy certified to County Commissioners …………………………………………………… December 15 County Commissioners certify levy to County Assessor ………………………………………… December 22 Ensuing Collection Year Taxes attach as an enforceable lien on property ……………………………………………………… January 1 First installment due date (one-half of taxes due) ……………………………………………… … February 28 Taxes due in full (unless installments elected by taxpayer) …………………………………… ……… April 30 Second installment due date (second half due) ………………………………………………… ……… June 15 The City has an enforceable legal claim on the taxes when the levy is certified in December, and records a receivable on that date. Taxes are collected by the Larimer County Treasurer on behalf of the City and are remitted by the 10th day of the month following collection. A 2% collection fee is retained by the County as compensation for collecting the taxes. B. Deficit Fund Balance and Net Position The URA fund had a deficit fund balance of $5,096,984 as of December 31, 2017. The fund will continue to have a deficit fund balance for the next few years as Tax Increment Funding (TIF) monies are collected through increased property tax collections. The Community Development Block Grant fund had a deficit fund balance of $154,967 as of December 31, 2017 due to expenditures that have not been reimbursed as of year-end and thus associated revenues are deemed unavailable for recognition. The Downtown Development Authority reported a deficit net position of $2,288,115. The fund will continue to have a deficit net position for the next few years as TIF monies are collected through increased property tax collections. C. Tax Abatements Primary Government and Blended Component Units Abatement Agreements The City has established two major tax abatement programs: (1) manufacturer’s use tax rebates (MUTR) and (2) business assistance agreements for purposes of economic development. Manufacturer’s Use Tax Rebate: The MUTR program is established by City Code Article II – Tax Refund and Rebate Program, section 25-64. Under this code section, the City may refund a portion of use taxes paid by a qualifying manufacturer for manufacturing machinery to be used in the City of Fort Collins directly and exclusively in the manufacture of tangible personal property for sale or profit. Once the taxpayer has completed the application process, the abatement comes in the form of a rebate payment check of taxes previously paid. The base use tax rate charged is 3.00% of the equipment cost, and rebates are for 1.50% of the first $5,000,000 in qualifying equipment purchases and 1.00% for purchases from $5,000,001 and up. The maximum rebate given to any one company is $2,400,000. City of Fort Collins Comprehensive Annual Financial Report 61 For the fiscal year ended December 31, 2017, the City abated use tax totaling $477,727, including one abatement agreement that exceeded 10% of the total amount abated under the MUTR program. Broadcom Limited, formerly Avago Technologies, received a MUTR abatement totaling $359,916. Business Assistance Agreements: The City approves primary employer business assistance agreements pursuant to and subject to the terms of Economic Health Financial Policy 9 and authorized by City Council under Resolutions 91-15, 99-23, 2013-025, and 2015-079. This policy applies to requests for direct assistance from primary employers looking to remain or expand their operations in the City, as well as primary employers evaluating relocation to the City. City Council approves business assistance packages subject to the following criteria: economic impact, contribution to quality of place, alignment with City objectives, natural resource stewardship, and community well-being. All agreements are performance-based including but not limited to annual average wages, number of retained or net new jobs, and/or health care premium assistance. The types of assistance commonly used are private activity bond financing, manufacturing equipment use tax rebates (separate from the standard MUTR program), and business personal property tax rebates. The maximum allowable property tax rebate will not exceed 50% of the City’s portion of the personal property tax rate, and the maximum term is not to exceed 10 years. Applicants for direct assistance commit to the following at a minimum: • Pledge to Annual Reporting • Separate Use Tax Schedule • Timeline for Confidentiality, no greater than 30 days • Assurance of Existing Workforce Retention For the fiscal year ended December 31, 2017, the City abated use tax and property tax totaling $397,716. Abatement recipients exceeding 10% of the total amount abated or that are otherwise deemed material for qualitative reasons were: Project Name Avago Technologies [Broadcom Limited] Building 4 FBAR Clean Room Facility Project Description Redevelopment of property by retrofitting wafer fabrication facility in 2014, including new 12,160 square foot FBAR Clean Room Facility expansion Approved Abatement 100% of use taxes paid, up to $3,882,200. Three rebate applications and seven concurrent annual payments for each application. 50% of personal property taxes paid, up to $629,100 in total and a limit on each annual payment of $157,700 2017 Amount $397,716 Project Commitment 135 net new jobs created in Fort Collins Recapture Provisions City may reduce the amount of any either use tax or personal property tax paid by the percentage shortfall from full compliance Project Name Woodward, Inc. World Headquarters Project Description Four-phase relocation and expansion of office space, manufacturing facilities, and testing facilities on a former golf course and designated redevelopment area 62 City of Fort Collins Comprehensive Annual Financial Report Approved Abatement 80% of use taxes paid on construction materials 80% of use taxes paid on eligible equipment, up to $1,212,000 Separate from the use tax abatement disclosed herein, the agreement includes separate incentives around development fees, capital improvement fees, and tax increment financing (TIF) of improvement and façade projects. 2017 Amount $159,145 of use tax rebates Project Commitment Maintain employment level of 1,400 employees Recapture Provisions Rebate is reduced by $500,000 if employment level has not reached 1,400 employees by December 31, 2018. Rebate is reduced by 40% if employment level has not reached 1,400 employees by December 31, 2020. Project Name Foothills Mall Redevelopment Project Description Redevelopment of blighted property after decline in sales tax revenue since 2001 of over 61%. Revitalization project costing $312 million, of which $53 million was approved in public assistance in the form of City sales tax revenue abatements and Urban Renewal Authority (URA) tax increment financing (TIF). Approved Abatement Pledged sales tax increment on General Fund portion (2.25%) of sales tax collections above a sales tax base established in 2013. Increment of 25 years beginning May 1, 2013 and ending April 30, 2038. Sales tax increment is only paid toward debt service as fifth priority after 1) Mall Metro District Debt Service Mill Levy, 2) Mall Metro District Specific Ownership Taxes, 3) URA Property Tax TIF and 4) Mall Metro District Public Improvement Fee. 2017 Amount $205,255 Project Commitment Developer commits to build parking structure, City-owned and operated recreational facility, ditch relocation for storm drainage, upgrades and improvements to utilities, and construction of a pedestrian underpass linking the District to transit. Recapture Provisions Once District debt is paid off, the balances in a supplemental debt service reserve are returned to the City. City of Fort Collins Comprehensive Annual Financial Report 63 NOTE III. DETAILED NOTES ON ALL FUNDS A. Deposits and Investments Deposits Colorado State Statutes govern the City’s deposits of cash. The statutes specify eligible depositories for public cash deposits, which must be Colorado institutions and must maintain federal insurance (FDIC) on deposits held. The Colorado Public Deposit Protection Act (PDPA) requires all units of local government deposit cash in eligible public depositories determined by state regulators. Amounts on deposit in excess of federal insurance levels must be collateralized in accordance with the PDPA. PDPA allows the institution to create a single collateral pool for all public funds to be maintained by another institution or held in trust for all the uninsured public deposits as a group. The market value of the collateral must be at least 102% of the aggregate uninsured deposits. All deposits in 2017 were in eligible public depositories, as defined by the Public Deposit Protection Act of 1989. Primary Government The carrying amount of the City's deposit accounts as of December 31, 2017 was $66,894,075, excluding the Pension Trust Fund and agency funds. The bank balance was $68,570,493. Component Unit The Downtown Development Authority’s undivided share of the City’s deposits as of December 31, 2017 was a carrying amount of $505,601. The bank balance was $518,816. Custodial Credit Risk – Deposits For deposits, custodial credit risk is the risk that, in the event of a bank failure, the City’s deposits might not be returned. Due to the federal deposit insurance and the collateral no deposits for the City or the component unit were exposed to custodial credit risk. Investments Investment policies are governed by the City's own investment policies and procedures. Investments of the City and its discretely presented component unit may include: • Legal investments for municipalities under state statutes. • Interest-bearing accounts or certificates of deposit at banks or savings and loans in Colorado which are eligible public depositories (including CDARS). • Obligations of the United States Government, its agencies or instrumentalities. • Debt of U.S. corporations having an investment grade rating. • Obligations issued by or on behalf of the City. • State or local government obligations having an investment grade rating. • Prime rated banker's acceptances. • Prime rated commercial paper. • Guaranteed investment contracts. • Repurchase and reverse repurchase agreements of any marketable security described above which afford the City a perfected security interest in such security. 64 City of Fort Collins Comprehensive Annual Financial Report • Local government investment pools authorized under the laws of the State of Colorado. • Shares in any money market fund or account, unit investment trust or open or close-end investment company, all of the net assets of which are invested in securities described above. • Mutual funds that include eligible investments found above. In addition to the above, investments of the General Employees' Retirement Plan may include: • Equity investments. • Domestic mutual funds. • International mutual funds. • Bond mutual funds. The City’s and its discretely presented component unit’s investments are subject to interest rate and credit risk as described below: Interest Rate Risk The City’s investment policy limits its exposure to fair value losses arising from rising interest rates by: • Whenever possible, holding investments to their stated maturity dates. • Investing a portion of the operating funds in shorter-term securities, money market mutual funds, or local government investment pools. Concentration of Credit Risk The City places maximum limits on the amount the City may invest in any one issuer. Limits vary by investment type. More than 5% of the City’s investments are in Federal National Mortgage Association (FNMA), Federal Home Loan Bank (FHLB), Federal Farm Credit Bank (FFCB), and MetLife global Funding (Corporate Bond). These investments were 34.1%, 13.1%, 34.4%, and 6.7%, respectively, of the City’s total investment. Custodial Credit Risk for Investments For an investment, custodial credit 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’s investment policy restricts holding of securities by counterparties and utilizes a third- party safekeeping arrangement with financial institutions. Credit Risk The City's investment policy limits investments in corporate bonds to the top three ratings issued by nationally recognized statistical rating organizations (NRSROs) at the time of purchase. As of December 31, 2017, the City's investment in corporate bonds was rated A- or better by Standard and Poor's and Baa1 or better by Moody's Investors Service. The City’s investment policy also allows for the City to invest in local government investment pools. As of December 31, 2017, the local government investment pools (ColoTrust and CSAFE) in which the City had invested and reported at amortized cost, were rated AAAm by Standard and Poor’s. The City’s investments in US government agencies were rated Aaa by Moody’s and AA+/- by Standard and Poor’s. City of Fort Collins Comprehensive Annual Financial Report 65 Fair Value Measurements The City categorizes its assets and liabilities measured at fair value within the hierarchy established by GAAP. The hierarchy is based on the valuation inputs used to measure the fair value of the asset. • Level 1 inputs are quoted prices (unadjusted) for identical assets or liabilities in active markets that a government can access at the measurement date. • Level 2 inputs are inputs other than quoted prices included within Level 1 that are observable for an asset or liability, either directly or indirectly. • Level 3 inputs are unobservable inputs for an asset or liability. The fair value hierarchy gives the highest priority to Level 1 inputs and the lowest to Level 3 inputs. If the fair value of an asset or a liability is measured using inputs from more than one level of the fair value hierarchy, the measurement is considered to be based on the lowest priority level input that is significant to the entire measurement. Information regarding the City’s fair value, credit risk rating, maturity, and fair value measurement are described below. Investment prices for the City’s securities are reported by US Bank, the City’s custodial bank. US Bank acquires its pricing data from Interactive Data, a third-party provider, which provides global security evaluations and fair value pricing for fixed income securities. Their evaluations represent a good faith opinion as to what a buyer in the marketplace would pay for a security in a current sale. Interactive Data’s evaluations are based on market data and evaluated pricing models that vary by asset class and incorporate trade, bid and other market information as well as evaluated pricing applications utilizing benchmark curves, benchmarking of like securities, sector groupings, and matrix pricing to prepare evaluations. In addition, model processes such as the Option Adjusted Spread model are used to assess interest rate impacts and develop prepayment scenarios. For each asset class, teams of evaluators gather information from market sources and integrate relevant credit information, perceived market movements, and sector news into the evaluated pricing applications and models. The City invests primarily in fixed income securities and Local Government Investment Pools (LGIP). The General Employees’ Retirement Plan (GERP) invests primarily in domestic and international mutual funds, and fixed income securities. The investments are valued at fair value at least monthly. For the City and GERP, the following fair value techniques were utilized in measuring the fair value of its investments. Mutual Funds: The investments are reported at fair value based on quoted NAV market prices through mutual fund companies and obtained from the National Association of Securities Dealers. U.S. Government Agency and Investment Grade Corporate securities: U.S. Government Agency securities are reported at fair value based on a multi-dimensional relational model and Option Adjusted Spread model. The model inputs include benchmark yields, reported trades, broker/dealer quotes, issuer spreads, two-sided markets, benchmark securities, bids, offers, and other reference data including TRACE reported trades. TRACE is a program developed by the National Association of Securities Dealers (NASD) which allows for the reporting of over-the counter transactions for eligible fixed-income securities. 66 City of Fort Collins Comprehensive Annual Financial Report The City has no other investments meeting the fair value disclosure requirements of GASB Statement No. 72. As of December 31, 2017, the City had the following investments and maturities: Fair Value Credit Risk Rating Measurement Fair Up to 121 days More than Investment Type S&P/Moody's Level Value 120 days to 5 years 5 years Investments measured by fair value levels Instrumentality Federal Farm Credit Bank (FFCB) AA+/AAA 2 $ 115,597,362 $ 2,332,785 $ 110,929,688 $ 2,334,889 Federal Home Loan Bank (FHLB) AA+/AAA 2 44,009,848 - 44,009,848 - Federal Home Loan Mortgage Corporation (FHLMC) AA+/AAA 2 14,423,971 - 14,423,971 - Federal National Mortgage Association (FNMA) AA+/AAA 2 114,330,472 8,728,159 105,602,313 - Corporate bonds AA+/AA1 2 5,897,534 - 5,897,534 - Corporate bonds AAA/AAA 2 3,277,357 - 3,277,357 - Corporate bonds AA+/AAA 2 8,024,945 8,024,945 - - Corporate bonds AA-/AA3 2 28,483,311 12,259,945 16,223,366 - Corporate bonds AA/AA2 2 1,697,846 - 1,697,846 - Total Investments Controlled by the City $ 335,742,646 $ 31,345,834 $ 302,061,923 $ 2,334,889 Percent of Total 9% 90% 1% The City has $34,114,235 measured at net asset value (NAV) invested in Mutual Funds held by Fidelity Investments for employees' retirement accounts. Component Unit Fair Value Credit Risk Rating Measurement Fair Up to 121 days More than Investment Type S&P/Moody's Level Value 120 days to 5 years 5 years Investments measured by fair value levels Instrumentality Federal Farm Credit Bank (FFCB) AA+/AAA 2 $ 1,442,477 $ 29,110 $ 1,384,231 $ 29,136 Federal Home Loan Bank (FHLB) AA+/AAA 2 549,176 - 549,176 - Federal Home Loan Mortgage Corporation (FHLMC) AA+/AAA 2 179,989 - 179,989 - Federal National Mortgage Association (FNMA) AA+/AAA 2 1,426,671 108,914 1,317,757 - Corporate bonds AA+/AA1 2 73,592 - 73,592 - Corporate bonds AAA/AAA 2 40,896 - 40,896 - Corporate bonds AA+/AAA 2 100,139 100,139 - - Corporate bonds AA-/AA3 2 355,429 152,986 202,443 - Corporate bonds AA/AA2 2 21,187 - 21,187 - Investments measured at amortized cost Certificates of Deposit 1,250,000 - 1,250,000 - Total DDA Investments $ 5,439,556 $ 391,149 $ 5,019,271 $ 29,136 Percent of Total 7% 92% 1% Investment Maturities Investment Maturities City of Fort Collins Comprehensive Annual Financial Report 67 Restrictions on Cash and Investments Cash and investments at December 31, 2017 were restricted for the following: B. Notes Receivable In March 1996, the City entered into an agreement with a developer for the construction of low income apartment units. Under the agreement, the City loaned $913,000 to the developer from the HOME Program special revenue fund and received a deed of trust against the property. By an Assignment and Assumption Agreement and a Second Amendment and Loan Extension agreement, both dated May 18, 2017, another developer assumed the original debt obligation and further agreed to pay the City $1.5 million in principal plus interest. The loan bears interest at 3% per annum. The loan is to be repaid from 50% of the net available cash flow generated by the project as calculated annually. While there is no set payment schedule any unpaid principal balance and accrued interest is to be paid in full as of May 15, 2054. Based upon a review of project income statements, the project did not have a net available cash flow in 2017. The City received no interest payments for 2017. The outstanding balance as of December 31, 2017 is $1,500,000. The allowance recorded against this receivable is $1,500,000. Accrued interest on this loan has not been recorded since it is uncertain as to the frequency of when the project will be able to make payments against the note. The Light and Power Fund and Water Fund have certain notes receivable related to Light and Power efficiencies with customers connected to a Home Efficiency Loan Program. The balance of these loans as of December 31, 2017 is $1,219,745. In May 2009, URA loaned Rocky Mountain Innovation Initiative (RMII) $1,100,000 for the construction of their new facility. In January 2010, the URA loaned RMII an additional $4,203,939 for the remaining cost of construction. The loan has a 20-year term, interest rate of 1.5%, annual interest only payments, and a balloon payment in 2029. The agreement also provided RMII the option in year 8 to pay $2,503,939 in principal, plus interest, and the URA will credit RMII’s eligible costs up to $2,800,000. RMII exercised that option in 2017. The loan balance as of December 31, 2017 is $0. Fund/Component Unit Amount Restriction Downtown Development Authority $ 1,250,000 Debt service through bond ordinance Urban Renewal Authority 953,644 Debt service through bond ordinance Equipment fund 1,600,860 Unspent lease proceeds Wastewater 6,542 Unspent lease proceeds Capital Projects 497 Unspent lease proceeds 68 City of Fort Collins Comprehensive Annual Financial Report C. Capital Assets A summary of changes in capital asset activity for the year ended December 31, 2017 follows: Beginning Ending Balance Additions Transfers Deletions Balance Primary Government: Governmental activities Capital assets, not being depreciated: Land, rights of way, water rights, other $ 226,063,039 $ 5,267,107 $ 5,087,701 $ (61,268) $ 236,356,579 Street system infrastructure 326,038,145 - 21,852,419 - 347,890,564 Construction in progress 31,154,978 47,772,072 (38,271,893) - 40,655,157 Total capital assets, not being depreciated 583,256,162 53,039,179 (11,331,773) (61,268) 624,902,300 Capital assets, being depreciated: Infrastructure 28,312,116 872,581 206,022 - 29,390,719 Buildings and improvements 139,294,934 247,938 9,887,869 - 149,430,741 Improvements other than buildings 158,038,289 9,083,546 1,027,557 - 168,149,392 Machinery and equipment 93,993,615 5,646,051 210,325 (3,103,802) 96,746,189 Total capital assets being depreciated 419,638,954 15,850,116 11,331,773 (3,103,802) 443,717,041 Less accumulated depreciation for: Infrastructure (13,346,553) (1,573,887) - - (14,920,440) Buildings and improvements (46,578,014) (2,820,676) - - (49,398,690) Improvements other than buildings (53,702,507) (6,623,766) - - (60,326,273) Machinery and equipment (64,303,195) (5,770,626) - 2,882,456 (67,191,365) Total accumulated depreciation (177,930,269) (16,788,955) - 2,882,456 (191,836,768) Total capital assets being depreciated, net 241,708,685 (938,839) 11,331,773 (221,346) 251,880,273 Governmental activities capital assets, net $ 824,964,847 $ 52,100,340 $ - $ (282,614) $ 876,782,573 Business-type activities Capital assets, not being depreciated: Land, rights of way, water rights, other $ 70,833,214 $ 2,284,339 $ 97,899 $ - $ 73,215,452 Construction in progress 124,720,082 44,782,020 (72,259,195) - 97,242,907 Total capital assets, not being depreciated 195,553,296 47,066,359 (72,161,296) - 170,458,359 Capital assets, being depreciated: Buildings and improvements 231,995,051 - 11,001 - 232,006,052 Improvements other than buildings 619,483,148 - 65,688,813 - 685,171,961 Machinery and equipment 79,305,005 1,768,120 6,461,482 (887,826) 86,646,781 Total capital assets being depreciated 930,783,204 1,768,120 72,161,296 (887,826) 1,003,824,794 Less accumulated depreciation for: Buildings and improvements (106,686,722) (4,847,012) - - (111,533,734) Improvements other than buildings (266,174,030) (17,130,909) - - (283,304,939) Machinery and equipment (51,791,508) (4,334,340) - 719,170 (55,406,678) Total accumulated depreciation (424,652,260) (26,312,261) - 719,170 (450,245,351) Total capital assets being depreciated, net 506,130,944 (24,544,141) 72,161,296 (168,656) 553,579,443 Business-type activities capital assets, net $ 701,684,240 $ 22,522,218 $ - $ (168,656) $ 724,037,802 City of Fort Collins Comprehensive Annual Financial Report 69 Depreciation expense was charged functions / programs of the primary government as follows: Beginning Balance Additions Transfers Deletions Ending Balance Component Unit: Capital assets, not being depreciated: Land, water rights, rights of way, other $ 2,528,747 $ - $ - $ - $ 2,528,747 Construction in progress 15,450 21,000 (36,450) - - Total capital assets, not being depreciated 2,544,197 21,000 (36,450) - 2,528,747 Capital assets, being depreciated: Buildings and improvements 4,495,465 - - - 4,495,465 Improvements other than buildings 25,930 - 36,450 - 62,380 Total capital assets being depreciated 4,521,395 - 36,450 - 4,557,845 Less accumulated depreciation for: Buildings and improvements (2,010,351) (92,190) - - (2,102,541) Improvements other than buildings (17,443) (3,709) - - (21,152) Total accumulated depreciation (2,027,794) (95,899) - - (2,123,693) Total capital assets being depreciated, net 2,493,601 (95,899) 36,450 - 2,434,152 Component unit capital assets, net $ 5,037,798 $ (74,899) $ - $ - $ 4,962,899 Governmental Business-Type Activities Activities General government $ 773,684 $ - Public safety - police and judicial 1,408,230 - Cultural, parks, recreation and environmental services 5,040,611 - Community planning and environmental services 36,094 - Transportation services 7,919,953 - Capital assets held by the City's internal service funds used for governmental activities 1,610,383 - Light and Power - 10,325,278 Water - 6,955,095 Wastewater - 5,940,856 Storm Drainage - 2,716,948 Non-major enterprise funds - Golf - 328,330 Capital assets held by the City's internal service fund used for business-type activities - 45,754 Total depreciation expense 16,788,955 26,312,261 Less capital assets held by the City's internal service funds 1,610,383 45,754 Depreciation expense $ 15,178,572 $ 26,266,507 70 City of Fort Collins Comprehensive Annual Financial Report D. Inter-fund Transfers and Advances Transfers are primarily used to 1) move revenues from the fund with collection authorization (e.g. Sales and Use Tax Fund) to the General Fund for overall operating expenditures and the Transportation Services, Capital Projects and Natural Areas Fund for dedicated voter approved programs and projects, and 2) move unrestricted General Fund revenues to finance various programs that the government must account for in other funds in accordance with budgetary authorizations, including amounts provided as subsidies or matching funds for various grant programs. Advances to URA In May 2009, the City loaned the URA $5,303,939 to help fund the development and construction of the Rocky Mountain Innovation Initiative (RMII) facility for the business incubation program. This loan has a 20 year term and bears a fixed interest rate of 2.5%. For years 0 through 4, there will be no payments but interest will accrue. For year 5, there will be a lump sum, annual payment consisting of the interest accrued during the no payment term and year 5. For years 6 and 7, there will be an annual payment, of interest only. For years 8 through the maturity date, there will be annual payments of principal and interest. In 2017, the URA made an interest and principal payment of $86,780 and $3,268,728, respectively. The amount outstanding as of December 31, 2017 is $2,035,211. In November 2013, the City loaned the URA $5,000,000 for The Summit on College Project, a mixed-use student housing project in the Prospect South Tax Increment Financing District. The loan has a 24 year term and bears a fixed interest rate of 2.68%. The outstanding balance as of December 31, 2017 is $4,655,299. In December 2014, the City loaned URA $247,000 for Prospect Station project. The loan has a 23 year term and bears a fixed interest rate of 4.5%. The outstanding balance as of December 31, 2017 is $227,100. Capital Nonmajor Storm Internal Transfer out: General Projects Governmental Drainage Service Total Governmental Funds General $ - $ 2,736,731 $ 17,269,451 $ 2,556 $ 5,958,755 $ 25,967,493 Keep Fort Collins Great - - 20,500 - - 20,500 Capital Projects 37,500 - 283,987 - - 321,487 Nonmajor Governmental 853,162 13,940,690 10,492,851 - 424,928 25,711,631 Proprietary Funds Light & Power 12,210 - 14,690 - 208,326 235,226 Water 213,207 - 5,281 - 208,326 426,814 Wastewater 66,724 - 16,062 - 128,200 210,986 Storm Drainage 325,748 - 232,871 - 64,100 622,719 Golf - - - - 61,078 61,078 Internal Service 169,860 - - - 2,242,202 2,412,062 Total transfers in $ 1,678,411 $ 16,677,421 $ 28,335,693 $ 2,556 $ 9,295,915 $ 55,989,996 Transfers In: City of Fort Collins Comprehensive Annual Financial Report 71 E. Long-term Obligations The City utilizes various types of debt and other long-term obligations in conducting its business. The following describes the various bonds and other types of financing used by the City and its component unit. Certificates of Participation and Assignment of Lease Payments: Through the Fort Collins Leasing Corporation, the City issues certificates of participation (COP) and assignments of lease payments (ALP) for the acquisition and construction of major capital facilities and improvements. The debt is secured by the constructed facilities and improvements. Debt service payments are made from the rents collected by the Leasing Corporation based upon lease agreements between the City and the Leasing Corporation. As of December 31, 2017, the City had $29,658,577 and $1,0154,422 of COP/ALP outstanding for governmental and business-type activities, respectively. Capital Leases: The City also enters into lease agreements as a lessee for financing the acquisition of land, various machinery and equipment for both governmental and business-type activities. The capital assets acquired from the lease agreements are included with capital assets and the amortization of leased equipment is included with depreciation in the financial statements. These lease agreements qualify as capital leases for accounting purposes and therefore, have been reflected at the present value of their future minimum lease payments as of the inception date. The City had $8,463,063 and $748,702 of capital leases outstanding as of December 31, 2017, for governmental and business-type activities, respectively. Cost of all capital assets holding at December 31, 2017 acquired under capital leases: DDA Short-Term Obligation: In 2012, a revolving line of credit was established with a bank for a 6 year period in the amount of $1,000,000 to finance DDA projects and programs in accordance with its approved Plan of Development, the Downtown Plan and the Downtown Strategic Plan. During the fiscal year 2017, total draw amounts were $2,336,168. During 2017, a total of $2,336,168 was repaid and there is no amount outstanding as of December 31, 2017. No interest was paid as the minimum loan origination fee paid exceeded interest expense during the time the loan was outstanding. The DDA pays a portion of the City’s 2007 COP. In 2017, the principal payment was $260,609. The DDA services the 2010A and 2010B Subordinate Tax Increment Revenue Bonds. The taxable 2010A tax increment revenue bonds will mature in 2018 and the tax-exempt 2010B increment revenue bonds will mature in 2020. Balance, End of Year Balance, End of Year Buildings and Improvements $ 351,930 $ - Improvements other than buildings - 114,030 Machinery and equipment 20,293,576 2,415,283 Accumulated depreciation (10,461,699) $ (1,587,424) Net Book Value $ 10,183,807 $ 941,889 Governmental Activities Business Type Activities 72 City of Fort Collins Comprehensive Annual Financial Report In 2013, the City issued a subordinate tax increment revenue bond with a Corporation for the principal sum of $6,050,000 to be serviced by the DDA. The Bond is not a general obligation of the City and full faith and credit of the City is not pledged to pay the debt service requirements. Principal and interest payments are secured by a pledge of Tax Increment Revenue. In the event the available Pledged Tax Increment Revenues are not sufficient to repay the principal of and interest on the Bond in full during the Tax Increment Period the City has declared the intent to pay any unpaid amounts from legally available funds of the City, subject to appropriation by the Council. The outstanding balance as of December 31, 2017 is $5,398,491. URA: In 2013, the City issued tax increment revenue bonds for the principal sum of $11,085,000 to be serviced by the Urban Renewal Authority – North College District. The bond is a special and limited obligation of the City payable solely out of and secured by a pledge of tax increment revenue. The proceeds were received by the URA and were used to pay off advances made by the City for the North College Marketplace, JAX Inc. Building Expansion, Northeast College Corridor Outfall, and the Kaufman and Robinson projects. The outstanding balance as of December 31, 2017 is $8,860,000. Pledged Revenues Date Amount of Revenue Term of Issued Description Revenue Pledged Pledged Purpose of Debt Commitment 1999 Water Revenue Bonds Water Revenues 550,163 Water Capital Projects through 2019 2003 Subordinate Water Revenue Bonds Water Revenues 1,515,652 Water Capital Projects through 2030 2008 Water Revenue Refunding Bonds Water Revenues 2,089,892 Water Capital Projects through 2018 2001 Storm Drainage Revenue Bonds Storm Drainage Revenues 2,604,659 Storm Drainage Improvements through 2021 2007 Storm Drainage Revenue Refunding Bonds Storm Drainage Revenues 3,089,580 Storm Drainage Improvements through 2019 2011 Storm Drainage Revenue Refunding Bonds Storm Drainage Revenues 4,573,202 Storm Drainage Improvements through 2022 2009 Sewer Revenue Bonds Sewer Revenues 2,416,794 Sewer Capital Projects through 2018 2010 Sewer Revenue Bonds Sewer Revenues 1,330,946 Sewer Capital Projects through 2020 2016 Sewer Revenue Bonds Sewer Revenues 23,453,070 Sewer Capital Projects through 2028 2010 Light and Power Bonds Light and Power Revenues 5,783,328 Light and Power Capital Projects through 2020 Date % Revenue P & I for Recognized for Issued Description Pledged 2017 2017 1997 Water Revenue Bond 1-15% 386,166 36,618,710 1999 Water Revenue Bonds 1-15% 366,523 36,618,710 2003 Subordinate Water Revenue Bonds 1-15% 188,224 36,618,710 2008 Water Revenue Bonds 1-15% 2,082,189 36,618,710 2001 Storm Drainage Revenue Bonds 1-25% 745,442 16,755,272 2007 Storm Drainage Revenue Refunding Bonds 1-25% 1,992,451 16,755,272 2007 Storm Drainage Revenue Refunding Bonds 1-25% 452,774 16,755,272 2011 Storm Drainage Revenue Refunding Bonds 1-25% 905,247 16,755,272 2009 Sewer Revenue Bonds 1-25% 2,416,794 23,174,893 2010 Sewer Revenue Bonds 1-25% 439,186 23,174,893 2016 Sewer Revenue Bonds 1-25% 690,400 23,174,893 2010 Light and Power Bonds 1-25% 2,033,801 12,164,304 City of Fort Collins Comprehensive Annual Financial Report 73 The following tables display the debt service requirements to maturity for the obligations described: Year Ending December 31 Principal Interest Principal Interest Total 2018 595 352 8,956 1,542 11,445 2019 615 334 6,904 1,209 9,062 2020 635 309 5,423 930 7,297 2021 665 284 3,002 691 4,642 2022 690 257 2,773 571 4,291 2023-2027 3,880 851 10,505 1,554 16,790 2028-2030 1,780 114 2,397 53 4,344 $ 8,860 $ 2,501 $ 39,960 $ 6,550 $ 57,871 Year Ending December 31 Principal Interest Principal Interest Total 2018 5,225 550 225 4 6,004 2019 3,945 462 - - 4,407 2020 2,635 397 - - 3,032 2021 2,690 344 - - 3,034 2022 2,745 289 - - 3,034 2023-2026 12,170 616 - - 12,786 $ 29,410 $ 2,658 $ 225 $ 4 $ 32,296 Governmental Activities Business-Type Activities Revenue Bonds (amounts expressed in thousands) Governmental Activities Business-Type Activities Certificates of Participation Payments (amounts expressed in thousands) 74 City of Fort Collins Comprehensive Annual Financial Report The following tables display the debt service requirements to maturity for the obligations described: Year Ending December 31 Principal Interest Principal Interest Total 2018 58 4 184 12 258 2019 61 3 193 9 266 2020 63 2 202 6 18 273 2021 67 1 211 3 282 $ 249 $ 10 $ 790 $ 30 66 $ 1,079 Year Ending December 31 Principal Interest Principal Interest Total 2018 3,043 162 273 14 0 3,492 2019 2,400 100 208 9 2,717 2020 1,702 53 142 5 0 1,902 2021 960 21 95 2 1,078 2022 358 3 31 0 392 $ 8,463 $ 339 $ 749 $ 30 $ 1 $ 9,581 Year Ending December 31 Principal Interest Total 2018 2,053 205 2,258 2019 2,070 208 2,278 2020 1,758 147 1,905 2021 384 96 480 2022 383 97 480 2023-2027 1,993 407 (0) 2,400 2028-2030 1,438 100 1,538 $ 10,079 $ 1,260 $ 11,339 Governmental Activities Business-Type Activities Component Unit DDA - Tax Increment Bonds (amounts in thousands) (amounts in thousands) Assignment of Lease Payments (amounts in thousands) Governmental Activities Business-Type Activities Capital Lease Payments City of Fort Collins Comprehensive Annual Financial Report 75 General long-term obligations of the primary government at December 31, 2017 is comprised of the following: Date Maturity Original Outstanding Issued Description/Interest Rates Dates Balance Balance Bonds Serviced by Urban Renewal Authority - North College District Secured by tax increment property taxes 2013 2013 URA Tax Increment Revenue Bonds (2.000 - 4.250%) 2029 $ 11,085,000 $ 8,860,000 COP / ALP serviced by General Fund and General Improvement District No. 1 Fund through the Fort Collins Capital Leasing Corporation Debt Service Fund 2007 Lease Certificates of Participation (3.860%) 2018 12,880,000 1,340,000 2012 Lease Certificates of Participation (1.820%) 2026 34,395,000 19,645,000 2017 Lease Certificates of Participation (2.480%) 2027 8,425,000 8,425,000 2001 Assignment of Lease Payments - Police (4.70%) 2021 890,000 248,577 Unamortized premium on bonds 229,966 Other Obligations of Governmental Funds N/A Compensated absences N/A N/A 6,049,751 N/A Net pension liability N/A N/A 4,933,850 N/A Total post employment health care liability N/A N/A 146,784 Other Obligations of Internal Service Fund used by Governmental Activities Various Capital lease obligations (secured by leased equipment) Various N/A 8,462,854 N/A Compensated absences N/A N/A 618,459 N/A Claims payable N/A N/A 6,633,135 N/A Net pension liability N/A N/A 805,867 Total $ 66,399,243 Component Unit long - term debt at December 31, 2017, is comprised of the following obligations: Bonds Serviced by Downtown Development Authority Debt Service Fund 2010 Subordinate Tax Increment Revenue Bonds (4.010-6.080%) 2020 $ 12,500,000 $ 4,680,000 Secured by tax increment property taxes 2013 Subordinate Tax Increment Revenue Bonds 2031 6,050,000 5,398,357 Variable interest rate based on the 10 year U.S. Treasury Note with a .25% floor Secured by tax increment property taxes Other Obligations – Component Unit N/A Compensated absences N/A N/A 15,424 Total $ 10,093,781 (Continued) 76 City of Fort Collins Comprehensive Annual Financial Report Business-type long-term obligations at December 31, 2017 consists of the following: Date Maturity Original Outstanding Issued Description/Interest Rates Dates Balance Balance Bonds, COP, and ALP, serviced by Enterprise Funds Light and Power Fund Secured by light and power revenues 2010 Light and Power Bond B (2.25-4.52%) 2020 $ 6,410,000 $ 5,270,000 Water Fund Secured by water revenues 1999 Water Revenue Bond (3.28-5.25%) 2019 4,998,395 503,104 2003 Subordinate Water Revenue Bonds (5.025% ) 2030 2,476,446 1,211,397 2008 Water Revenue Bond (3.46%) 2018 9,645,000 2,020,000 Storm Drainage Fund Secured by storm drainage revenues 2001 Storm Drainage Revenue Bond (4.50-5.25%) 2021 9,845,000 2,245,000 2007 Storm Drainage Revenue Refunding Bonds A (4.086%) 2019 15,945,000 2,910,000 2011 Storm Drainage Revenue Refunding Bonds (2.49%) 2022 8,515,000 4,250,000 Wastewater Fund Secured by sewer revenue 2009 Sewer Revenue Bonds (2.0-5.0%) 2018 30,655,000 1,500,000 2010 Sewer Revenue Bonds (2.99%) 2020 3,900,000 1,255,000 2016 Sewer Revenue Refunding Bonds (2.0-4.0%) 2028 18,795,000 18,795,000 3,001,701 Golf Fund Secured by golf revenue 2007 Lease Certificates of Participation (3.860%) 2018 1,715,000 225,000 2001 Assignment of Lease Payments (4.70%) 2021 2,830,000 790,422 Other Obligations of Enterprise Funds Various Capital lease obligations (secured by leased equipment) Various 748,702 N/A Net pension liability N/A 4,409,374 N/A Total post employment health care liability N/A 64,218 N/A Compensated absences N/A 1,753,070 Other Obligations of the Internal Service Fund used by Business-type Activities N/A Compensated absences N/A 353,168 N/A Net pension liability N/A 1,068,478 Total $ 52,373,634 Unamortized premium on bonds City of Fort Collins Comprehensive Annual Financial Report 77 The City is maintaining all reserves required by ordinances and agreements with other third parties. Within the governmental funds, these reserves are being maintained in debt service and special revenue funds as required by ordinances or agreements. Certificates of participation issued by the Fort Collins Capital Leasing Corporation are payable from rents collected under a lease agreement between the City and the Leasing Corporation. Conduit Debt Obligations From time to time, the City has issued Industrial Development Revenue Bonds to provide financial assistance to private-sector entities for the acquisition and construction of industrial and commercial facilities deemed to be in the public interest. The bonds are secured by sources external to the City and are payable solely from payments received from outside parties. The City is not obligated in any manner for repayment of the bonds. Accordingly, the bonds are not reported as liabilities in the accompanying financial statements. As of December 31, 2017, there were 7 series of Industrial Development Revenue Bonds outstanding, with an estimated aggregate principal amount payable of $46,785,000. 78 City of Fort Collins Comprehensive Annual Financial Report Changes in long-term liabilities Long-term liability activity for the year ended December 31, 2017 was as follows: Beginning Balance, Ending Due Within as restated Additions Reductions Balance One Year Primary Government: Governmental Activities Bonds, COP, and ALP: Revenue bonds $ 9,435,000 $ - $ (575,000) $ 8,860,000 $ 595,000 Certificates of participation 25,365,000 8,425,000 (4,380,000) 29,410,000 4,460,000 Assignment of lease payments 303,843 - (55,266) 248,577 57,898 Total bonds, COP and ALP 35,103,843 8,425,000 (5,010,266) 38,518,577 5,112,898 Add bond premium 249,264 - (19,298) 229,966 - Total bonds, COP and ALP 35,353,107 8,425,000 (5,029,564) 38,748,543 5,112,898 Other Liabilities: Capital leases 8,190,279 3,396,700 (3,124,125) 8,462,854 3,042,535 Compensated absences 6,254,701 6,194,932 (5,781,423) 6,668,210 6,668,210 Claims payable 6,309,820 21,607,552 (21,284,237) 6,633,135 3,337,035 Net pension liability 7,423,575 - (1,683,858) 5,739,717 - Total post employment health care liability 150,838 (4,054) 146,784 - Total other liabilities 28,329,213 31,199,184 (31,877,697) 27,650,700 13,047,780 Governmental activities long-term liabilities $ 63,682,320 $ 39,624,184 $ (36,907,261) $ 66,399,243 $ 18,160,678 Business-Type Activities Bonds, COP, and ALP: Revenue bonds $ 49,837,666 $ - $ (9,878,165) $ 39,959,501 $ 8,955,742 Certificates of participation 425,000 - (200,000) 225,000 225,000 Assignment of lease payments 966,156 - (175,734) 790,422 184,102 51,228,822 - (10,253,899) 40,974,923 9,364,844 Add bond premium 3,369,748 - (368,047) 3,001,701 - Less bond discount (1,570) - 1,570 - - Total bonds, COP and ALP 54,597,000 - (10,620,376) 43,976,624 9,364,844 Other Liabilities: Capital leases 719,910 292,440 (263,598) 748,702 272,600 Compensated absences 1,978,380 2,381,224 (2,253,366) 2,106,238 2,106,238 Net pension liability 7,084,886 - (1,607,034) 5,477,852 - Total post employment health care liability 65,992 - (1,774) 64,218 - Total other liabilities 9,849,168 2,673,664 (4,125,772) 8,397,010 2,378,838 Business-type activities long-term liabilities $ 64,446,168 $ 2,673,664 $ (14,746,148) $ 52,373,634 $ 11,743,682 Component Unit: Bonds: Tax revenue bonds $ 12,020,705 $ - $ (1,942,348) $ 10,078,357 $ 2,053,122 Compensated absences 14,083 30,532 (29,191) 15,424 15,424 Component unit long-term liabilities $ 12,034,788 $ 30,532 $ (1,971,539) $ 10,093,781 $ 2,068,546 City of Fort Collins Comprehensive Annual Financial Report 79 Liquidation and Reporting of Governmental Activities Long-Term Liabilities The General Fund is primarily used to liquidate the governmental activities liabilities for compensated absences, net pension liability and net post-employment health care obligation. Internal service funds, except for the Utility Customer Service and Administration Fund, predominantly serve the governmental funds. Accordingly, long-term liabilities for these funds are included as part of the above totals for governmental activities. Long-term liabilities of the Utility Customer Service and Administration internal service fund are included as part of the totals for the business-type activities. 80 City of Fort Collins Comprehensive Annual Financial Report F. Fund Balances GASB Statement No. 54, Fund Balance Reporting and Governmental Fund Type Definitions establishes criteria for classifying fund balances into specifically defined classifications and clarifies definitions for governmental fund types. The following table represents these classifications and the purposes for which the amounts can be spent as of December 31, 2017. Fund Balances (Deficit): General Keep Fort Collins Great Capital Projects Urban Renewal Authority Other Governmental Funds Total Nonspendable: Advances $ 4,882,399 $ - $ - $ - 85,430 $ 4,967,829 Inventories 1,477,894 - - - - 1,477,894 Prepaids - - - - 3,892 3,892 Udall endowment 125,000 - - - - 125,000 Total Nonspendable 6,485,293 - - - 89,322 6,574,615 Restricted: Voter approved capital - - 11,736,482 - 9,905,500 21,641,982 Community and operation - - - - 29,230,648 29,230,648 Parking - - - - 819,773 819,773 Convention and visitors bureau 213,579 - - - - 213,579 DDA/Woodward bonds 700,000 - - - - 700,000 Economic rebates 2,608,840 - - - - 2,608,840 Emergency 6,914,703 - - - - 6,914,703 Fiscal agent - - 968,927 - 968,927 Horticulture 365,040 - - - - 365,040 Street maintenance - 3,614,468 - - - 3,614,468 Other transportation - 1,848,870 - - 1,023,420 2,872,290 Police services 959,738 3,733,155 - - - 4,692,893 Fire and emergency services - 200,930 - - - 200,930 Parks and recreation 212,708 1,512,351 - - 240,979 1,966,038 Other 21,878 1,821,485 - - 848,535 2,691,898 PEG distribution 27,436 - - - - 27,436 Sustainability services - - - - 686,723 686,723 Udall property 26,881 - - - - 26,881 Total Restricted 12,050,803 12,731,259 11,736,482 968,927 42,755,578 80,243,049 Committed: Capital projects 26,874 - 5,884,375 - 41,830,717 47,741,966 Cultural development and planning 316,796 - - - 2,800,837 3,117,633 Traffic calming 31,782 - - - - 31,782 Total Committed 375,452 - 5,884,375 - 44,631,554 50,891,380 Assigned: Affordable housing 1,315,652 - - - - 1,315,652 Camera radar 895,397 - - - - 895,397 Community and operation 880,615 - - - 4,696,446 5,577,061 Downtown parking plan - - - 976,261 976,261 Encumbrance for purchase orders 4,351,985 - - - 478,714 4,830,699 Harmony road - - - 5,672,599 5,672,599 Manufacturer use tax rebate 670,000 - - - - 670,000 Recreation - - - - 244,232 244,232 General government 9,598,416 - - - 4,100,981 13,699,397 Transportation - - - - 8,146,758 8,146,758 Waste innovation program 196,988 - - - - 196,988 City of Fort Collins Comprehensive Annual Financial Report 81 NOTE IV. OTHER INFORMATION A. Risk Management Property, Liability, and Workers Compensation The City self-insures a portion of its comprehensive automobile liability, general liability, police liability, and public official liability exposures as well as damage or destruction of property. The City utilizes the Self- Insurance Fund (an internal service fund) to finance and account for risks of property and liability loss. The City purchases property insurance that has a $100,000 per occurrence deductible for most causes of loss including earthquake. Flood deductibles are $100,000 per occurrence with exception of $500,000 for Building, $500,000 for Contents, and $250,000 per occurrence for properties within a Flood Zone A that are not eligible under the National Flood Insurance Program (NFIP). Crime and boiler and machinery coverage has a $10,000 deductible. Vehicles have a $100,000 deductible. The City purchases liability insurance through a risk retention group. This policy has a $500,000 deductible for all types of liability claims. Coverage limits are as follows: General, Law Enforcement and Wrongful Acts Liability – $10 million/occurrence, $20 million aggregate, with aggregate applying to each coverage separately. Auto Liability - $10 million/occurrence with no aggregate. Public Official Liability - $10 million/each wrongful act, $20 million aggregate. Workers’ Compensation losses are self-insured up to $500,000 for all worker classifications. An excess policy providing limits mandated by the State of Colorado provides coverage above the self-insured retention. The Downtown Development Authority, a component unit, purchases general, public official liability, property, workers compensation, and umbrella insurance policies from commercial insurance companies. The general liability policy has no deductible, the public official liability policy has a $1,000 deductible and the employment related practice claims have a 50% of loss, with a maximum $100,000 per occurrence deductible. The property insurance policy has a deductible of $500. Coverage limits are as follows: General Liability – included per occurrence, no annual aggregate Public Entity Liability - $2,000,000 annual per occurrence limit / no annual aggregate Public Official Liability - included/occurrence, no annual aggregate. Umbrella Liability - $1,000,000 per occurrence, no annual aggregate. Workers Compensation Liability – Part A is paid according to state schedule Part B Employers Liability - $2,000,000 per employee/accident/disease. Employee Health and Illness The City and the component unit self-fund their employees for comprehensive major medical benefits under a Preferred Provider Options (PPO) health plan. The Benefits Fund (an internal service fund) is utilized to finance and account for medical risks of loss. Stop-loss coverage of $225,000 per occurrence is retained as excess risk coverage. During the past three years, there have been 18 claims that have exceeded the stop-loss limit. Funding and Claims Liabilities All funds or employees of the City, as applicable, participate in the above risk management programs. Charges to City funds for these services are based on estimates of the amounts needed to pay claims, establish reserves for catastrophic losses, and pay policy premiums. Claims liabilities for the Self-Insurance and Benefits Funds as of December 31, 2017, amount to $5,056,067 and $1,577,069 respectively. These claims were determined on an actuarial basis, and reflect the GASB Statement No. 82 City of Fort Collins Comprehensive Annual Financial Report 10 requirement that a liability for claims be reported, if information prior to the issuance of the City's financial statements indicates that it is probable that a liability has been incurred at December 31, and the amount of the loss can be reasonably estimated. The liability of $5,056,067 for the Self Insurance Fund is undiscounted and reflects a 75% confidence level factor. The discount refers to the full or undiscounted amount reduced for future investment earnings that can be generated on funds held between the date of valuation and the date of the final payment of claims. Changes in claims liabilities amounts for 2015, 2016, and 2017 are as follows: B. Employee Retirement Systems and Pension Plans 1. General Employees' Retirement Plan Plan Description The General Employees’ Retirement Plan (the Plan) is a governmental plan established pursuant to IRS Code Section 414(d). The Plan is administered by the General Employees Retirement Committee (GERC) with City Council having the option to alter, amend or terminate the Plan. All permanent, classified, non-uniformed employees hired before January 1, 1999 are eligible to be members of the General Employees' Retirement Plan, a single-employer defined benefit plan. Employees hired after January 1, 1999 are only eligible to participate in the Money Purchase Plan. The benefits and refunds of the Plan are recognized when due and payable in accordance with the terms of the plan. Benefits vest 40% after 2 years of credited service and 20% for each year thereafter until 100% is attained after 5 years. Employees who retire at or after age 65 with 5 years of credited service are entitled to an annual retirement benefit, payable monthly for life, in an amount equal to 1.5% of final average monthly compensation multiplied by years of credited service. Final average monthly compensation is the highest average of the considered compensation during 60 consecutive full calendar months out of the last 120 calendar months of credited service. A member is eligible for an early retirement benefit after age 55 and completion of 2 years of credited service. The monthly benefit, payable for life, is equal to the vested portion of the normal retirement benefit based on credited service and compensation at early retirement, reduced by 1/180th for each of the first 60 months and 1/360th for each additional month by which payments commence prior to normal retirement date. The Plan also provides for death and disability benefits. A death benefit of approximately 50% of the member's vested accrued benefit at the date of death is payable to the employee's spouse for life beginning on the first day of the month following the later of the date of death or the date the member would have been age 55. The spouse may elect to receive the actuarial equivalent lump-sum payment. If the member was not married, the beneficiary or estate would receive the actuarial single-sum payment of the benefit. Self-Insurance Benefits Claims payable - December 31, 2015 $ 4,231,647 $ 1,575,483 Claims & changes in estimates 805,957 22,120,247 Claim payments (503,345) (21,920,168) Claims payable - December 31, 2016 $ 4,534,259 $ 1,775,562 Claims & changes in estimates 2,103,780 19,503,772 Claim payments (1,581,971) (19,702,265) Claims payable - December 31, 2017 $ 5,056,067 $ 1,577,069 City of Fort Collins Comprehensive Annual Financial Report 83 As of December 31, 2017, employee membership data related to the Plan was as follows: Retirees and beneficiaries currently receiving benefits 242 Inactive employees entitled to but not yet receiving benefits 89 Active plan participants 70 Total 401 The Plan is accounted for in the General Employees' Retirement Plan Pension Fund (a pension trust fund). The entire cost of the Plan is paid by the City as established or amended by City Council. The City’s current funding policy is to contribute 10.5% of the compensation for active plan participants plus an annual supplemental contribution while the plan is underfunded. The Plan does not issue a stand-alone financial report. Financial statements for the Plan are presented within the City’s financial statements as a fiduciary pension trust fund. Net Pension Liability Actuarial Assumptions An actuarial valuation is performed annually to determine the total pension liability. The net pension liability is to be measured as the total pension liability less the Plan’s fiduciary net position. To value the Plan, the actuary must predict future events such as investment return, mortality, and rates of termination and retirement using actuarial assumptions. Any variation in future experience from that expected from these assumptions will result in corresponding changes in the estimated costs of the Plan’s benefits. A description of assumptions applied in the current valuation follow. Valuation date January 1, 2018 Measurement date December 31, 2017 Inflation 2.50% Salary increase including inflation Graded by age including inflation, productivity and merit increases Mortality RP-2000 projected generationally using scale AA Actuarial cost method Entry Age Normal Asset valuation method Market value Investment rate of return 6.25% per annum, compounded annually net of investment-related expenses COLA None Change in assumptions The investment return rate assumption was lowered to 6.25% to better reflect anticipated experience Significant changes There were no significant changes between the valuation date and measurement date Discount Rate The Plan's fiduciary net position was projected to be available to make all projected future benefit payments of current active and inactive employees; therefore, the discount rate for calculating the total pension liability is equal to the long-term expected rate of return. Change in the discount rate since the prior measurement period is as follows: Measurement Date 12/31/16 12/31/17 Discount Rate 6.50% 6.25% Long-term expected rate of return, net of investment expense 6.50% 6.25% Bond Municipal Bond Index 3.78% 3.44% 84 City of Fort Collins Comprehensive Annual Financial Report Money-Weighted Rate of Return The money-weighted rate of return considers the changing amounts actually invested during a period and weights the amount of pension plan investments by the proportion of time they are available to earn a return during that period. External cash flows are determined on a monthly basis and are assumed to occur at the middle of each month. External cash inflows are netted with external cash outflows, resulting in a net external cash flow each month. The money-weighted rate of return is calculated net of investment expenses. Long-Term Expected Rate of Return The best-estimate range for long-term expected rate of return is determined by adding expected inflation to the expected long-term real returns and reflecting expected volatility and correlation. The following is the Plan’s asset target allocations and the long-term expected geometric real rate of return for each asset class as of December 31, 2017. Asset Class Target Allocation Long-Term Expected Geometric Real Rate of Return Domestic Equity 45% 3.1% International Equity 15% 4.1% Fixed Income 40% 1.6% Change in Net Pension Liability Total Pension Liability Increase(Decrease) Plan Fiduciary Net Position Net Pension Liability (a) (b) (a) – (b) Balance as of December 31, 2016 $58,377,767 $43,869,310 $14,508,457 Changes for the year Service Cost 313,286 - 313,286 Interest on total pension liability 3,695,911 - 3,695,911 Effect of economic/demographic gains of losses 21,369 - 21,369 Effect of assumption changes or inputs 1,337,286 - 1,337,286 Benefit payments (3,720,322) (3,720,322) - Employer contributions - 1,652,786 1,652,786 Net investment income - 7,032710 7,032710 Administrative expense - (26,752) (26,752) Balance as of December 31, 2017 $60,025,297 $48,807,732 $11,217,565 Fiscal Year Ending Net Money-Weighted December 31 Rate of Return 2017 16.48% 2016 5.92% 2015 -0.62% City of Fort Collins Comprehensive Annual Financial Report 85 Sensitivity Analysis The following presents the net pension liability, calculated using the discount rate of 6.25%, as well as what the net pension liability would be if it were calculated using a discount rate that is 1 percentage point lower (5.25%) or 1 percentage point higher (7.25%) than the current rate. Current Discount 1% Decrease Rate 1% Increase 5.25% 6.25% 7.25% Total pension liability $65,680,278 $60,025,297 $55,127,589 Fiduciary net position 48,807,732 48,807,732 48,807,732 Net pension liability 16,872,546 11,217,565 6,319,857 Fiduciary net position as % of total pension liability 74.3% 81.3% 88.5% Pension Expense and Deferred Outflows of Resources Related to Pension For the year ended December 31, 2017, the City recognized pension expense of $2,443,971. The City reported deferred (inflows) of resources related to pension from the following source: Net difference between projected and actual earnings ($1,981,970) Deferred outflows for the net difference between projected and actual earnings are recognized over a period of five years. Amounts reported as deferred outflows of resources related to pension will be recognized in the pension expense as follows: Net Deferred Year Ending (Inflows) of December 31 Resources 2018 $ (166,121) 2019 (166,120) 2020 (800,090) 2021 (849,639) Total (1,981,970) 86 City of Fort Collins Comprehensive Annual Financial Report Financial Statements of the General Employees’ Retirement Plan Contributions and Reserves The Plan's funding policy provides for actuarially determined periodic rates determined by the entry age normal cost method. Under this method, the actuarial present value of the projected benefits of each individual included in the valuation is allocated on a level basis over the earnings of the individual between entry age and assumed exit age. Contributions are based on the actuarially determined rates. For 2017, the City contributed 31.5% of covered pay to the Plan as well as the supplemental contributions; this amounted to $1,652,786. The authority for establishing or amending the obligation to make contributions rests with City Council. ASSETS Cash and cash equivalents $ 2,491,850 Receivables, interest 67,123 Investments, at fair value US government securities 10,410,072 Corporate bonds 1,724,452 Mutual funds 34,114,235 Total investments, at fair value 46,248,759 Total Assets 48,807,732 NET POSITION Net position held in trust for pension benefits $ 48,807,732 ADDITIONS Contributions Employer contributions $ 1,652,786 Investment income Interest 208,422 Net change in fair value of investments 6,824,288 Total investment income 7,032,710 Total Additions 8,685,496 DEDUCTIONS Benefit payments 3,720,322 Administrative expense 26,752 Total Deductions 3,747,074 Increase in Net Position 4,938,422 NET POSITION - Beginning 43,869,310 NET POSITION - Ending $ 48,807,732 Statement of Fiduciary Net Position December 31, 2017 Statement of changes in Fiduciary Net Position For the Year Ended December 31, 2017 City of Fort Collins Comprehensive Annual Financial Report 87 Costs of administering the Plan are all financed from contributions and earnings of the Plan. The entire balance of the Plan's net position available for benefits as of December 31, 2017, is $48,807,732 all of which is reserved for benefits of employees and beneficiaries. Concentration of Credit Risk Investments in mutual funds exceeding 5% of the net position of the plan are as follows: Fidelity Value Fund – 6.0%, Vanguard 500 Index Inv – 7.5%, TRP International (PRITX) – 6.4%, TRP New Asia – 7.1%, Vanguard Mid Cap Index Investor 5.3%. 2. Money Purchase Plan 401(a) The City offers its employees a defined contribution money purchase plan. The City does not have administrative involvement and does not perform the investment function of this plan; therefore, it is not included in the City’s financial statements. Classified employees were offered the plan for the first time in 1995. In a defined contribution plan, benefits depend solely on amounts contributed to the plan plus investment earnings. Employees are eligible to participate six months from the date of employment. The plan requires both employer and employees to contribute amounts ranging from 3% to 10% (depending on job classification) of base salary each pay period. Contributions made by the City are not taxable to the employee until they are withdrawn. Employee contributions are made with pre-tax dollars, and the earnings on City and employee contributions are not taxed until withdrawn. Except for certain categories of police personnel, employees are fully vested upon initial participation in the plan. Sworn police officers and emergency service dispatchers, who receive higher contribution rates, are fully vested upon completion of three years of service. Plan provisions and contribution requirements are established and may be amended by City Council. City and employee contributions to the plan were $6,390,833 and $3,798,842, respectively during 2017. 3. Retirement Health Savings Plan (RHS) In 2006 and 2007, the City offered to classified and unclassified management employees the employer- sponsored health benefits savings vehicle that allowed the employee to accumulate assets to pay for medical expenses in retirement on a tax-free basis. As of 12/31/07, the plan has been frozen. There can no longer be any money withheld for this plan. Police Services, through the Collective Bargaining Unit (CBU), continue to offer a mandatory RHS plan to collective bargaining unit members only. Both the frozen City plan and the current CBU plan are administered by ICMA-RC. The City does not have administrative involvement and does not perform the investment function of this plan; therefore, it is not included in City’s financial statements. The RHS plan offers triple tax advantage to employees. Employee contributions are made through pre-tax payroll deductions, are invested in ICMA-RC funds and grow tax-free, and monies can be withdrawn tax-free for qualifying expenses. No federal, state or FICA tax will be withheld. Employees cannot change their elections after their initial enrollment. The CBU RHS plan requires a mandatory 1% contribution to be made by all qualifying participants with less than 10 years of service, 1.25% for participants with 10-20 years of service, and 1.5% for participants with more than 20 years of service. Once participants become eligible to get reimbursed from their own RHS account, they can turn in receipts to a third-party administrator and be reimbursed with tax- free monies. If the employee passes away, the employee’s spouse and dependents are automatically eligible to use the account and are reimbursed on a tax-free basis. Employee contributions to the CBU RHS plan were $467,153 during 2017. 88 City of Fort Collins Comprehensive Annual Financial Report 4. Statewide Death and Disability Plan Plan Description The City contributes to the Fire & Police Pension Association (the Plan), a multi-employer cost sharing defined benefit plan covering full-time employees of substantially all fire and police departments in Colorado. Contributions to the Plan are used solely for the payment of death and disability benefits. The Plan was established in 1980 pursuant to Colorado Revised Statutes. All uniformed employees are eligible to be members of the Fire & Police Pension Association. Funding Policy and City Contributions Prior to 1997, the State of Colorado, whose contributions were established by Colorado statute, primarily funded the Plan. The State made a one-time contribution in 1997 of $39,000,000 to fund the past and future service costs for all firefighters and police officers hired prior to January 1, 1997. No further State contributions are anticipated. The annual contribution rate for members hired on or after January 1, 1997 and for members covered by Social Security is 2.6% as of January 1, 2011. Based on the January 2014 actuarial results, the Fire & Police Pension Association Board of Directors agreed to continue the 2.7% contribution rate effective through December 31, 2017. During 2017, 2016, and 2015, the City’s contributions were $759,433, $691,991, and $631,888, respectively, equal to the statutory required contribution each year. Benefits Benefits are established by Colorado statute. If a member dies prior to retirement, the surviving spouse is entitled to a benefit equal to 40% of the member’s monthly base salary with an additional 10% of base salary if a surviving spouse has two or more dependent children, or if there are three or more dependent children without a surviving spouse. Benefit entitlement continues until death of the spouse and death, marriage, or other termination of dependency of children. A member who becomes disabled prior to retirement shall be eligible for disability benefits. The benefit is 70% of base salary for cases of total disability. Effective October 1, 2002, the benefit is 50% of base salary for a permanent occupational disability and 40% of base pay for a temporary occupation disability. Benefits paid to members are evaluated and may be re-determined on October 1 of each year. Any increase in the level of benefits cannot increase by more than 3% for any one year. Totally disabled members and their beneficiaries receive an automatic cost of living adjustment each year of 3%. Separately issued financial statements and the related actuarial valuation may be obtained from the Fire & Police Pension Association. C. Other Postemployment Benefits As stated in Note I (Summary of Significant Accounting Policies), Part H Adoption of New Accounting Pronouncements, effective January 1, 2017, the City adopted GASB Statement No. 75, Accounting and Financial Reporting for Postemployment Benefits Other Than Pensions. The net OPEB obligation recorded in accordance with GASB Statement No. 45 was removed and the total OPEB liability was recorded in accordance with GASB Statement No. 75. Plan Description The City sponsors a single-employer health care plan that provides medical, vision, dental and prescription drug benefits to all retired employees and their eligible dependents. Employees retiring on or after January 1, 2010 are City of Fort Collins Comprehensive Annual Financial Report 89 no longer eligible to participate in the Retiree Health Plan. In addition, those employees retiring on or after September 1, 2009 but before January 1, 2010 and elect retiree health coverage may participate in the Retiree Health Plan until age 65. To be eligible an employee must have had at least 10 or more years of service. The City administrative policy authorized this benefit until January 1, 2010. The plan does not issue a stand-alone financial report. Funding Policy and City Contributions Employees pay the full premium. The current funding policy of the City is to pay health claims as they occur through internal allocated funds. The required contribution is based on projected pay-as-you-go financing. For fiscal year 2017, the City contributed $20,180. Retiree and active members receiving benefits contribute monthly premiums as outlined: Participants Covered by the Benefit Terms The following is a summary of Plan participants at December 31, 2017: Total OPEB Liability: The City’s total OPEB liability of $211,002 was measured as of December 31, 2017, and was determined by an actuarial valuation as of that date. The total OPEB liability in the December 31, 2017 actuarial valuation was determined using the following actuarial assumptions and other inputs: Mortality rates were based on the RP-2000 Healthy Annuitant Mortality Table projected generationally using Scale AA. The size of the Plan’s population is not large enough to have a statistically credible independent study of retiree mortality. A standard published table appropriate to the Plan’s retiree population was used with a margin for future mortality improvement relative to recent Plan experience. Premier Non- Medicare Premier Medicare Dental Vision Employee: $ 1,227 $ 490 $ 40 $ 8 Employee +1: 2,452 981 71 16 Participants Retiree Spouse Medical 4 1 Dental 13 8 Vision 11 4 Inflation 2.50% Salary increases, including inflation N/A Discount rate 3.44% The discount rate was based on the Bond Byer 20-Bond Governmental Obligations Index 90 City of Fort Collins Comprehensive Annual Financial Report Changes in the Total OPEB Liability: Changes of assumptions and other inputs reflect a change in the discount rate from 3.78 percent in 2016 to 3.44 percent in 2017. Sensitivity Analysis The following presents the total OPEB liability of the City, calculated using the discount rate of 3.44 percent, as well as what the City’s total OPEB liability would be if it were calculated using a discount rate that is 1 percentage point lower (2.44 percent) or 1 percentage point higher (4.44 percent) than the current rate: The following presents total OPEB liability of the City, calculated using the current healthcare cost trend rates as well as what the City’s total OPEB liability would be if it were calculated using trend rates that are 1 percentage point lower or 1 percentage point higher than the current trend rates: Deferred Inflows/Outflows of Resources For the year ended December 31, 2017, the City recognized OPEB expense of $14,352. At December 31, 2017, the City reported $0 in deferred outflows of resources and $0 in deferred inflows of resources. There were no amounts reported as deferred outflows of resources and deferred inflows of resources related to OPEB. Increase (Decrease) Total OPEB Liability Balance as of December 31, 2016 $ 216,830 Changes for the year: Service Cost - Interest on total OPEB liability 7,818 Effect of Plan changes - Effect of economic/demographic gains/losses - Effect of assumption changes or inputs 6,534 Benefit payments (20,180) Balance as of December 31, 2017 $ 211,002 1% Decrease 2.44% Discount Rate 3.44% 1% Increase 4.44% Total OPEB liability $ 192,763 $ 211,002 $ 232,507 Current 1% Decrease Trend Rate 1% Increase Total OPEB liability $ 193,782 $ 211,002 $ 230,841 City of Fort Collins Comprehensive Annual Financial Report 91 D. Presentation of Postemployment Benefit Liabilities Within the basic financial statements, the net pension liability and total OPEB liability are presented on a combined basis on certain exhibits, including within the proprietary funds. The breakdown of these amounts is as follows: Postemployment Benefit Obligations Total Post- Net Pension Total OPEB employment Liability Liability Obligations Governmental Activities Governmental Funds $ 4,933,849 $ 146,784 $ 5,080,633 Internal Service Funds Equipment Fund 464,718 - 464,718 Data & Communications Fund 259,404 - 259,404 Benefits Fund 81,746 - 81,746 Total Governmental Activities 5,739,717 146,784 5,886,501 Business -Type Activities Enterprise Funds Golf Fund 235,521 - 235,521 Light & Power Fund 958,244 36,696 994,940 Water Fund 1,426,050 - 1,426,050 Wastewater Fund 1,379,018 27,522 1,406,540 Storm Drainage Fund 410,541 - 410,541 Internal Service Funds Utility Customer Service Fund 1,068,478 - 1,068,478 Total Business-Type Activities 5,477,852 64,218 5,542,070 TOTAL $ 11,217,569 $ 211,002 $ 11,428,571 92 City of Fort Collins Comprehensive Annual Financial Report E. Commitments/Contingencies Construction Commitments The City had commitments of $4,871,728 for capital projects in governmental fund types and $4,820,185 in proprietary fund types at December 31, 2017. Future expenditures related to these commitments are expected to be financed through available resources and future revenues. Encumbrance Commitments for Proprietary Fund Types The financial statements do not include encumbrances for proprietary fund types. However, encumbrances for these funds are recorded by the City for management and budgetary control purposes. Outstanding encumbrance commitments for the proprietary funds at December 31, 2017 amounted to $25,598,424. Street Oversizing Liability The City has contractual liabilities for street oversizing costs with various developers. The developers are required to install certain oversized streets as a condition of subdivision approval. Once the streets are installed and inspected by the City, a liability is recorded for the difference between a normal sized street and the oversized street installed. Because the City has no control over when subdivisions will be developed and the related oversized street completed, the liability for uncompleted oversizing costs has not been reflected in the financial statements, because the amount is not considered by management to be probable and measurable. Solid Waste Financial Assurance The City’s Water Utility owns and operates a Water Treatment Facility, which through the treatment process produces solids, and therefore must provide financial assurance of estimates for post closure costs in accordance with regulations pertaining to solid waste sites and facilities (6 CCR 1007-2, Part 1) as set by the State of Colorado Department of Public Health and Environment. The facility is not expected to be closed in the future, however in the event of closure the City estimates and provides assurance of total Closure Costs and Post- Closure Care Requirements of $1,278,303 and $21,439, respectively. This estimate is not reported as a liability by the City because the water treatment facility does not meet the definition of a landfill contained in GASB Statement No. 18, as defined by the U.S. Environmental Protection Agency. F. Legal Matters Pending Litigation and Grants Various claims and lawsuits are pending against the City. After consideration of applicable insurance policy coverage, and the relative merits of each claim or lawsuit, it is the opinion of the City Attorney and City management that the potential ultimate liability resulting from these actions, if any, will not have a material adverse financial effect on the City. Under the terms of federal and state grants, periodic audits are required and certain costs may be questioned as not being appropriate expenditures under the terms of the grants. Such audits could lead to reimbursement to the grantor agencies. City management believes disallowances, if any, resulting from any such audits would be immaterial. There currently are no material disallowed or questioned costs. Tax, Spending, and Debt Limitations Article X, Section 20, of the State Constitution has several limitations, including those for revenue, expenditures, property taxes, and issuance of debt. These provisions of the Constitution are complex and subject to judicial City of Fort Collins Comprehensive Annual Financial Report 93 interpretation. In the opinion of management, the City is in compliance with such provisions. In 1997, the City’s electorate approved the ongoing retention of excess revenue by the City, requiring the excess revenue be spent for specified purposes. This alleviated the need by the City to seek annual approval to retain excess revenue and excess property tax. The excess revenue will be used for the purposes of public health and safety (including, but not limited to environmental monitoring and mitigation), growth management, transportation services, and maintaining and repairing City facilities. The State Constitution also requires local governments to establish emergency reserves equal to at least 3% of fiscal year spending as defined in the amendment. These emergency reserves cannot be used to compensate for economic conditions, revenue short falls, or salary and benefit increases. As of December 31, 2017, the amount required as an emergency reserve in compliance with the amendment is $6,914,703 and is shown as a restriction of fund balance in the General Fund. G. Related Party Transactions Due to the nature of the relationships, the City has related party transactions with various entities. The following transactions have occurred during 2017: 1. Northern Colorado Regional Airport Intergovernmental Agreement The Airport is jointly operated under an Intergovernmental Agreement between the City of Fort Collins, Colorado and the City of Loveland, Colorado. Pursuant to the agreement, any needed contributions for annual operating budgets or capital improvements are shared equally by both cities. Also, either City may invest additional funds in the Airport as it sees fit. Since July 3, 1979, ownership of assets vests equally with each City. Assets acquired prior to July 3, 1979 vested one-third with the City of Loveland and two-thirds with the City of Fort Collins. The agreement provides that if either City does not pay its one-half of agreed expenses in a given year, it will convey to the other City ten percent of its total Airport ownership. Each City contributed $177,500 in 2016 and $260,000 in 2017. 94 City of Fort Collins Comprehensive Annual Financial Report Financial Information The Northern Colorado Regional Airport is accounted for as a joint venture. A summary of financial information is as follows: As of December 31, 2017 For the Year Ended December 31, 2017 The City’s annual contribution is reflected as an expenditure of the General Fund. The City’s share of The Northern Colorado Regional Airport’s Net Position and Change in Net Position are reflected in the City’s Statement of Net Position and Statement of Activities, respectively. Total current assets $ 2,613,225 Total capital Assets (net of accumulated depreciation) 17,684,896 Total Assets 20,298,121 Total current liabilities 389,523 Total Net Position 19,908,598 Net investment in capital assets 17,684,896 Restricted capital - Unrestricted net position 2,223,702 Total Net Position $ 19,908,598 Total operating revenue $ 703,831 Total operating expense (2,453,568) Interest income 25,965 Non-operating revenue 520,000 Capital contributions 831,535 Change in Net Position $ (372,237) City of Fort Collins Comprehensive Annual Financial Report 95 Stand-Alone Financial Statements The stand-alone financial statements for the Airport can be obtained from the City of Loveland Finance Department at 500 East Third Street, Loveland, Colorado, 80537. 2. Poudre Fire Authority As mentioned in the summary of significant accounting policies, the City provides funding for PFA. During 2017, such funding amounted to $29,001,095 and was an expenditure in the General Fund, Keep Fort Collins Great Fund and Capital Expansion Fund. In addition, the City provided accounting and administrative services to PFA at no charge. 3. Platte River Power Authority The Light and Power Fund purchases all of its electrical power from PRPA. During 2017, these purchases amounted to $91,313,239 of which $7,825,224 is included in accounts payable at December 31, 2017. 4. North Front Range Metropolitan Planning Organization The City allows the North Front Range Metropolitan Planning Organization (NFRMPO) to participate in its employee benefit plans and bills NFRMPO for this coverage. In addition, NFRMPO also used the City’s fleet services for vehicle maintenance. During 2017, billings amounted to: H. Subsequent Events The City issued revenue bonds on June 14, 2018 in the Light and Power Fund with a par value of $129,635,000 and premium of $13,374,506. There were two series; 2018A was tax exempt with gross proceeds of $98,319,506, and 2018B was taxable with gross proceeds of $44,690,000. Monies will be used to start a new Broadband service within Light and Power. In conjunction with the issuance of the 2018 AB Light and Power revenue bonds, on June 13, 2018 the City defeased the 2010B Light and Power Revenue bonds. A payment of $5,646,330 was made from Light and Power to fund the escrow. Principle outstanding was $5,270,000. Benefits $ 120,945 Services 264,982 Total $ 385,927 96 City of Fort Collins Comprehensive Annual Financial Report REQUIRED SUPPLEMENTARY INFORMATION I. Modified Approach for City Streets Infrastructure Capital Assets In accordance with GASB Statement No. 34, the City is required to account for and report infrastructure capital assets. The City has several major infrastructure systems including the street system and various systems that distribute utility services. Each major infrastructure system can be divided into subsystems. For example, the street system can be divided into concrete and asphalt pavements, concrete curb and gutters, sidewalks, medians, streetlights, traffic control devices (signs, signals and pavement markings), landscaping and land. Subsystem detail is not presented in these basic financial statements; however, the City maintains detailed information on these subsystems. The City has elected to use the "Modified Approach" as defined by GASB Statement No. 34 for infrastructure reporting for its Streets Pavement System. Under GASB Statement No. 34, eligible infrastructure capital assets are not required to be depreciated under the following requirements: The City manages the eligible infrastructure capital assets using an asset management system with characteristics of (1) an up-to-date inventory; (2) perform condition assessments and summarize the results using a measurement scale; and (3) estimate annual amount to maintain and preserve at the established condition assessment level. The City documents that the eligible infrastructure capital assets are being preserved approximately at or above the established and disclosed condition assessment level. The City's Pavement Management Program conducts condition assessment surveys on a three-year cycle assuring that all data is updated within three-year period. City owned streets are classified based on land use, access and traffic utilization into the following three classifications: arterial, collector and local. Each street was assigned a physical condition based on potential defects. A Pavement Condition Index (PCI), a nationally recognized index, was assigned to each street and expressed in a continuous scale from 0 to 100, where 0 is assigned to the least acceptable physical condition and 100 is assigned to the physical characteristics of a new street. The City of Fort Collins is changing its focus from specifying a targeted average condition value to setting a specified Level of Service (LOS). Setting a LOS will allow for a range of funding needs to be determined to assess what funding level best suits the needs of the City in terms of desired LOS and available funding. LOS is a customer-driven measurement of condition. The City of Fort Collins’ goal is to maintain a LOS of “B”. LOS B is a high level of service in which pavements are in good condition, few deficiencies are present, the roads are providing good ride quality, low vehicle operating costs, minor signs of deterioration, and with few safety-related issues. Preventive and corrective maintenance activities can be used to keep the average network condition maintained. As of December 2017, the City’s street system is at a PCI of 78.9, approximately mid-range within the LOS of “B”. The City’s street system was at a PCI of 77 in 2016 and 72 in 2015. The average detail condition is as follows: Level of service……………………………….................PCI Range…………………….….....Percent of Roads LOS A (excellent)………………………………………..100 to 86………………………………………28% LOS B (good)……………………………………….….....85 to 71…………………………………….....56% LOS C (fair)………………………………………..……....70 to 56…………………………………..……13% LOS D (poor)………………………………………..….…55 to 41…………………………………………2% LOS F (very poor)……………………………..…………...40 to 0……….……………………..……………0% The City's next full three-year assessment cycle will be completed by the end of 2018. City of Fort Collins Comprehensive Annual Financial Report 97 REQUIRED SUPPLEMENTARY INFORMATION (continued) The City's streets are constantly deteriorating resulting from the following five factors; (1) traffic loads; (2) the sun's ultra-violet rays drying out and breaking down the top layer of pavement; (3) utility company/private development interests trenching operations; (4) winter freeze/thaw condition and water damage from both natural and other urban runoff; and (5) growth of the existing street system. The City is continuously taking actions to arrest the deterioration through short-term maintenance activities such as crack sealing, pothole patching, street sweeping, and sidewalk repair. The City's short-term maintenance expenditures delay deterioration; however, the overall network condition is not improved through these maintenance expenditures. The City has estimated the amount of annual expenditures required to maintain the City's streets at a Level of Service B. A schedule of estimated annual amount calculated to maintain and preserve its streets at the current level compared to actual expenditures for the street maintenance for the last five years is presented below: Maintenance Actual Year Estimate Experience 2017 $18,678,501 $19,113,302 2016 16,700,000 16,124,280 2015 15,858,500 15,015,591 2014 15,069,218 15,046,817 2013 15,565,821 15,250,042 98 City of Fort Collins Comprehensive Annual Financial Report REQUIRED SUPPLEMENTARY INFORMATION (continued) II. Pension SCHEDULE OF CHANGES IN NET PENSION LIABILITY AND RELATED RATIOS PENSION TRUST FUND FOR THE LAST THREE FISCAL YEARS* 2017 2016 2015 2014 2013 2012 2011 2010 2009 2008 Total Pension Liability Service Cost $ 313,286 $ 383,757 $ 447,690 $ 487,063 N/A N/A N/A N/A N/A N/A Interest on total pension liability 3,695,911 3,681,690 3,651,345 3,571,272 N/A N/A N/A N/A N/A N/A Effect of economic/demographic (gains) or losses 21,369 (455,387) 224,753 237,034 N/A N/A N/A N/A N/A N/A Effect of assumption changes or inputs 1,337,286 220,453 - 827,847 N/A N/A N/A N/A N/A N/A Benefit payments (3,720,322) (3,367,735) (4,205,104) (3,509,719) N/A N/A N/A N/A N/A N/A Net Change in Total Pension Liability 1,647,530 462,778 118,684 1,613,497 N/A N/A N/A N/A N/A N/A Total pension liability, Beginning 58,377,767 57,914,989 57,796,305 56,182,808 N/A N/A N/A N/A N/A N/A Total pension liability, Ending (a) $ 60,025,297 $ 58,377,767 $ 57,914,989 $ 57,796,305 N/A N/A N/A N/A N/A N/A Fiduciary Net Position Employer contributions $ 1,652,786 $ 1,720,650 $ 1,830,265 $ 1,905,906 N/A N/A N/A N/A N/A N/A Investment income net of investment expenses 7,032,710 2,496,850 (274,583) 2,630,327 N/A N/A N/A N/A N/A N/A Benefit payments (3,720,322) (3,367,735) (4,205,104) (3,509,719) N/A N/A N/A N/A N/A N/A Administrative expenses (26,752) (30,743) (22,706) (18,935) N/A N/A N/A N/A N/A N/A Net change in Plan Fiduciary Net Position 4,938,422 819,022 (2,672,128) 1,007,579 N/A N/A N/A N/A N/A N/A Fiduciary Net Position, Beginning 43,869,310 43,050,288 45,722,416 44,714,837 N/A N/A N/A N/A N/A N/A Fiduciary Net Position, Ending (b) $ 48,807,732 $ 43,869,310 $ 43,050,288 45,722,416 N/A N/A N/A N/A N/A N/A Employer's Net Pension Liability (a-b) $ 11,217,565 $ 14,508,457 $ 14,864,701 $ 12,073,889 N/A N/A N/A N/A N/A N/A Covered payroll $ 5,255,224 $ 6,191,383 $ 7,306,661 $ 7,306,659 N/A N/A N/A N/A N/A N/A Net pension liability as a % of covered payroll 213.46% 234.33% 203.44% 165.25% N/A N/A N/A N/A N/A N/A *Information for prior years is unavailable Fiscal Year Ending December 31 City of Fort Collins Comprehensive Annual Financial Report 99 REQUIRED SUPPLEMENTARY INFORMATION (continued) SCHEDULE OF INVESTMENT RETURNS GENERAL EMPLOYEES' RETIREMENT PLAN FOR THE LAST TEN FISCAL YEARS Fiscal Year Ending Net Money-Weighted Rate December 31 of Return Rate of return for 2013 and earlier are net of all expenses. Rate of return for 2014 and later is net of investment expenses only. Plan Year Required Contribution Employer Contribution Contribution Deficiency (Excess) Covered Payroll Actual Contribution as a % of Covered Payroll 2017 $ 1,671,799 $ 1,652,786 $ 19,013 $ 5,255,224 31.5% 2016 1,770,095 1,720,650 49,445 6,191,383 27.8% 2015 1,887,199 1,830,265 56,934 7,306,661 25.0% 2014 2,659,452 1,905,906 753,546 7,306,659 26.1% 2013 2,681,999 2,067,363 614,636 8,202,862 25.2% 2012 2,334,577 1,241,929 1,092,648 8,834,557 14.1% 2011 1,706,844 1,345,466 361,378 9,582,235 14.0% 2010 1,892,946 2,100,467 (207,521) 10,399,210 20.2% 2009 1,901,281 1,005,901 895,380 12,897,653 7.8% 2008 1,325,710 1,807,834 (482,124) 13,958,960 13.0% 2017 16.4% 2016 5.9% 2015 -0.6% 2014 6.0% 2013 18.7% 2012 11.6% 2011 -3.1% 2010 11.1% 2009 20.5% 2008 -26.5% SCHEDULE OF EMPLOYER CONTRIBUTIONS PENSION TRUST FUND LAST TEN FISCAL YEARS 100 City of Fort Collins Comprehensive Annual Financial Report REQUIRED SUPPLEMENTARY INFORMATION (continued) III. Other Postemployment Benefits Plan There is no covered payroll reported because the plan was closed to new retirees effective December 31, 2009. Valuation date January 1, 2018 Measurement date December 31, 2017 Inflation 2.50% Salary increase including inflation Graded by age including inflation, productivity, and merit increases Mortality RP-2000 projected generationally using scale AA Actuarial cost method Entry Age Normal Asset valuation method Market Value There were no significant changes between the fiscal year end and the valuation date. Actuarial Assumptions Total OPEB Liability: Service Cost $ - Interest 7,818 Changes of assumptions and other inputs 6,534 Benfit payments (20,180) Net change in total OPEB liability (5,828) Total OPEB liability, beginning 216,830 Total OPEB liability, ending $ 211,002 2017 2016 2015 2014 2013 2012 2011 2010 2009 2008 Total OPEB Liability Service cost $ - N/A N/A N/A N/A N/A N/A N/A N/A N/A Interest on total OPEB liability 7,818 N/A N/A N/A N/A N/A N/A N/A N/A N/A Changes of benefit terms - N/A N/A N/A N/A N/A N/A N/A N/A N/A Effect of economic/demographic gains or (losses) - N/A N/A N/A N/A N/A N/A N/A N/A N/A Effect of assumption changes or inputs 6,534 N/A N/A N/A N/A N/A N/A N/A N/A N/A Benefit payments (20,180) N/A N/A N/A N/A N/A N/A N/A N/A N/A Net change in total OPEB liability (5,828) N/A N/A N/A N/A N/A N/A N/A N/A N/A Total OPEB liability, beginning 216,830 N/A N/A N/A N/A N/A N/A N/A N/A N/A Total OPEB liability, ending 211,002 N/A N/A N/A N/A N/A N/A N/A N/A N/A Covered payroll N/A N/A N/A N/A N/A N/A N/A N/A N/A N/A Total OPEB liability as a % of covered payroll N/A N/A N/A N/A N/A N/A N/A N/A N/A N/A Notes to schedule: Changes of assumptions: Changes of assumptions and other inputs reflect the changes in the discount rate each period. The following are discount rates used in each period. 2017 3.44% 2016 3.78% Schedule of Changes in Total OPEB Liability and Related Ratios City of Fort Collins Comprehensive Annual Financial Report 101 THIS PAGE INTENTIONALLY LEFT BLANK SUPPLEMENTARY INFORMATION 102 City of Fort Collins Comprehensive Annual Financial Report SUPPLEMENTARY INFORMATION Non-Major Governmental Funds ........................................................................................................................... 104 General Fund Combining Schedules ..................................................................................................................... 133 Urban Renewal Authority Combining Schedules .................................................................................................. 139 Capital Projects Fund Budget Schedule ................................................................................................................. 145 Enterprise Funds .................................................................................................................................................... 150 Internal Service Funds ........................................................................................................................................... 156 Fiduciary Funds .................................................................................................................................................... 168 Component Unit Statements .................................................................................................................................. 172 City of Fort Collins Comprehensive Annual Financial Report 103 THIS PAGE INTENTIONALLY LEFT BLANK 104 City of Fort Collins Comprehensive Annual Financial Report blank NON-MAJOR GOVERNMENTAL FUNDS COMBINING AND INDIVIDUAL FUND FINANCIAL STATEMENTS AND SCHEDULES Special Revenue Funds Capital Expansion -- to account for capital expansion fees collected by the City and various projects funded by those fees. Sales and Use Tax -- to account for collections of the City's .25% sales and use tax designated for Natural Areas. CCIP -- to account for collections of the City's .25% sales and use tax designated for Community Capital Improvement Program, a 10-year voter-approved tax renewal dedicated to specific projects. Natural Areas -- to account for dedicated financial resources to be used for the acquisition of natural areas and trails. In addition, some of the fund is used for long-term management of existing natural areas and trails. Cultural Services and Facilities -- to account for revenues received from the Lincoln Center facility, performing and visual arts and General Fund subsidies used to promote cultural activities. Recreation -- to account for recreation fees and General Fund subsidies used to provide recreational programs for citizens. Cemeteries -- to account for revenues collected from the sale of burial plots. Perpetual Care -- to account for monies set aside for the maintenance costs of burial plots. Community Development Block Grant (CDBG) -- to account for revenues received from the federal government which are restricted to financing the City's Community Development Block Grant Program. Home Program -- to account for revenues received from the federal government restricted to financing the City's Home Program. Transit Services -- to account for federal grants and other revenues utilized to operate and maintain the City's bus system. Transportation Capital Expansion Fees -- to account for capital expansion fees used to pay the City's portion of street oversizing costs. Transportation -- to account for the revenues used to operate and maintain streets, bridges, traffic controls, and transportation long- term planning. Parking -- to account for the revenue and operations of Parking Services. General Improvement District No. 1 -- to account for property taxes and investment earnings used to fund debt service and other activities of the General Improvement District No. 1, a blended component unit. General Improvement District No. 15 - Skyview -- to account for property taxes and investment earnings used to fund the maintenance of the Skyview Subdivision street system of the General Improvement District No. 15, a blended component unit. Timberline/Prospect SID #94 -- to account for assessments used to pay for public improvements. Debt Service Fund Debt Service -- to account for property taxes and transfers from other funds used to pay general obligation bonds, sales and use tax revenue bonds, and highway users tax revenue bonds. Fort Collins Leasing Corporation -- to account for rental amounts received from lease payments between the City and the Corporation on municipal buildings and other structures. Monies used to pay certificates of participation issued by the Corporation. Capital Project Funds Neighborhood Parkland -- to account for parkland fees used to fund the acquisition, development and administration of neighborhood park and capital improvements. Conservation Trust Fund -- to account for revenues received from the Colorado State Lottery through the State Conservation Trust Fund which are restricted to financing capital projects which relate to the acquisition and development of open space and trails. City of Fort Collins Comprehensive Annual Financial Report 105 NON-MAJOR GOVERNMENTAL FUNDS COMBINING BALANCE SHEET DECEMBER 31, 2017 Community Cultural Capital Sales and Capital Improve- Natural Services & Expansion Use Tax ment Program Areas Facilities ASSETS Cash and cash equivalents $ 2,440,303 $ 122,586 $ 1,035,400 $ 2,436,667 $ 516,204 Investments 14,321,526 720,798 6,068,790 14,304,917 2,876,412 Receivables Property taxes - - - - - Sales and use taxes - 780,867 846,031 - - Accounts - - - 412,812 6,871 Interest 51,859 2,279 22,479 49,986 10,019 Prepaid item - - - - 3,742 Advances to other funds 1,017,606 - - - - Total Assets 17,831,294 1,626,530 7,972,700 17,204,382 3,413,248 LIABILITIES Accounts payable, accruals, and other - 1,615 - 224,951 102,411 Wages payable - - - 126,054 75,752 Due to other governments - - - - - Due to other funds - 624,074 - - - Unearned revenue - - - - 566,672 Deposits held - 252,304 - 14,508 58,990 Total Liabilities - 877,993 - 365,513 803,825 DEFERRED INFLOWS OF RESOURCES Unavailable revenue - property taxes - - - - - Unavailable revenue - grants - - - - - Unavailable revenue - other - - - - - Total Deferred inflows of resources - - - - - FUND BALANCES (DEFICIT) Nonspendable - - - - 3,742 Restricted - 748,537 7,972,700 16,838,869 100,000 Committed 17,831,294 - - - 468,578 Assigned - - - - 2,037,103 Unassigned - - - - - Total Fund Balances (Deficit) 17,831,294 748,537 7,972,700 16,838,869 2,609,423 Total Liabilities, Deferred Inflows of Resources and Fund Balances (Deficit) $ 17,831,294 $ 1,626,530 $ 7,972,700 $ 17,204,382 $ 3,413,248 Special Revenue Funds 106 City of Fort Collins Comprehensive Annual Financial Report Trans- Trans- Perpetual Home Transit portation portation Recreation Cemeteries Care CDBG Program Services CEF Services $ 473,991 $ 105,330 $ 275,184 $ - $ 676,898 $ 148,275 $ 3,674,196 $ 2,428,287 2,560,769 617,443 1,615,018 - - 778,113 21,571,286 14,321,956 - - - - - - - - - - - - - - - 846,031 78,884 28,878 3,035 56,920 13,460 4,865,620 - 1,584,578 8,933 2,154 5,628 - - 2,755 75,694 48,512 - - - - - 85,430 - 150 - - - - - - - - 3,122,577 753,805 1,898,865 56,920 690,358 5,880,193 25,321,176 19,229,514 290,265 6,437 - 46,931 - 273,965 182,817 3,400,773 170,951 16,745 - 2,898 3,636 364,526 9,441 383,237 170 - - - - 9,819 - 2,719 - - - 162,058 - - - - 379,573 - - - - 277,388 - - - - - - - - - - 840,959 23,182 - 211,887 3,636 925,698 192,258 3,786,729 - - - - - - - - - - - - - 768,085 - 66,233 - - - - - - - - - - - - - 768,085 - 66,233 - - - - - 85,430 - 150 40,641 - 1,898,865 - 686,722 - - - - 33,757 - - - - 25,004,102 1,293,822 2,240,977 696,866 - - - 4,100,980 124,816 14,082,580 - - - (154,967) - - - - 2,281,618 730,623 1,898,865 (154,967) 686,722 4,186,410 25,128,918 15,376,552 $ 3,122,577 $ 753,805 $ 1,898,865 $ 56,920 $ 690,358 $ 5,880,193 $ 25,321,176 $ 19,229,514 Special Revenue Funds (continued) City of Fort Collins Comprehensive Annual Financial Report 107 NON-MAJOR GOVERNMENTAL FUNDS COMBINING BALANCE SHEET (continued) DECEMBER 31, 2017 General General Imp. Timberline/ Total Improvement District # 15 Prospect Special Parking District # 1 Skyview SID #94 Revenues ASSETS Cash and cash equivalents $ 294,911 $ 121,051 $ 27,064 $ - $ 14,776,347 Investments 1,469,940 709,740 158,844 - 82,095,552 Receivables Property taxes - 298,626 32,141 - 330,767 Sales and use taxes - - - - 2,472,929 Accounts 1,451,551 3,642 205 - 8,506,456 Interest 5,219 2,476 554 - 288,547 Prepaid item - - - - 89,322 Advances to other funds - - - - 1,017,606 Total Assets 3,221,621 1,135,535 218,808 - 109,577,526 LIABILITIES Accounts payable, accruals, and other 56,113 156 - - 4,586,434 Wages payable 38,581 - - - 1,191,821 Due to other governments - - - - 12,708 Due to other funds - - - - 786,132 Unearned revenue - - - - 1,223,633 Deposits held - - - - 325,802 Total Liabilities 94,694 156 - - 8,126,530 DEFERRED INFLOWS OF RESOURCES Unavailable revenue - property taxes - 298,626 32,141 - 330,767 Unavailable revenue - grants - - - - 834,318 Unavailable revenue - other 1,330,892 - - - 1,330,892 Total Deferred inflows of resources 1,330,892 298,626 32,141 - 2,495,977 FUND BALANCES (DEFICIT) Nonspendable - - - - 89,322 Restricted 819,773 836,753 186,667 - 30,129,527 Committed - - - - 44,631,553 Assigned 976,262 - - - 24,259,584 Unassigned - - - - (154,967) Total Fund Balances (Deficit) 1,796,035 836,753 186,667 - 98,955,019 Total Liabilities, Deferred Inflows of Resources and Fund Balances (Deficit) $ 3,221,621 $ 1,135,535 $ 218,808 $ - $ 109,577,526 Special Revenue Funds (continued) 108 City of Fort Collins Comprehensive Annual Financial Report Debt Service Fund Capital Project Funds Fort Collins Total Total Leasing Neighborhood Conservation Capital Non-major Corporation Parkland Trust Project Governmental $ - $ 1,455,688 $ 442,647 $ 1,898,335 $ 16,674,682 - 8,537,301 2,603,236 11,140,537 93,236,089 - - - - 330,767 - - - - 2,472,929 - - - - 8,506,456 - 30,003 9,056 39,059 327,606 - - - - 89,322 - - - - 1,017,606 - 10,022,992 3,054,939 13,077,931 122,655,457 - 334,015 34,400 368,415 4,954,849 - 19,597 7,461 27,058 1,218,879 - - - - 12,708 - - - - 786,132 - - - - 1,223,633 - - - - 325,802 - 353,612 41,861 395,473 8,522,003 - - - - 330,767 - - - - 834,318 - - - - 1,330,892 - - - - 2,495,977 - - - - 89,322 - 9,612,973 3,013,078 12,626,051 42,755,578 - - - - 44,631,553 - 56,407 - 56,407 24,315,991 - - - - (154,967) - 9,669,380 3,013,078 12,682,458 111,637,477 $ - $ 10,022,992 $ 3,054,939 $ 13,077,931 $ 122,655,457 City of Fort Collins Comprehensive Annual Financial Report 109 NON-MAJOR GOVERNMENTAL FUNDS COMBINING STATEMENT OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCES FOR THE YEAR ENDED DECEMBER 31, 2017 Community Cultural Capital Sales and Capital Improve- Natural Services & Expansion Use Tax ment Program Areas Facilities REVENUES Taxes $ - $ 8,172,280 $ 8,178,558 $ - $ - Licenses and permits - - - - - Intergovernmental - - - 5,022,002 15,000 Fees and charges for services 4,175,085 - - 64,877 3,035,603 Earnings on investments 325,310 30,685 70,011 213,233 43,227 Miscellaneous revenue - 3,274 - 316,001 112,536 Total Revenues 4,500,395 8,206,239 8,248,569 5,616,113 3,206,366 EXPENDITURES Current operating Police services 2,368 - - - - Community services 18,103 - - 6,805,339 3,917,167 Planning, development and transportation - - - - - Information and employee 5,805 - - - - Sustainability services - - - - - Other - - - - - Intergovernmental Fire protection 1,631,089 - - - - Capital outlay - - - 5,435,632 376,876 Debt service Principal - - - - - Interest and debt service costs - - - - - Total Expenditures 1,657,365 - - 12,240,971 4,294,043 Excess of Revenues Over (Under) Expenditures 2,843,030 8,206,239 8,248,569 (6,624,858) (1,087,677) OTHER FINANCING SOURCES (USES) Transfers in - - - 8,705,826 1,314,809 Transfers out (6,180,424) (8,705,826) (7,031,372) (1,485,068) (16,025) Sale of capital assets - - - 229,283 2,114 Total Other Financing Sources (Uses) (6,180,424) (8,705,826) (7,031,372) 7,450,041 1,300,898 Net Changes in Fund Balances (3,337,394) (499,587) 1,217,197 825,183 213,221 Fund Balances (Deficit)-January 1 21,168,688 1,248,124 6,755,503 16,013,686 2,396,202 Fund Balances (Deficit)-December 31 $ 17,831,294 $ 748,537 $ 7,972,700 $ 16,838,869 $ 2,609,423 Special Revenue Funds 110 City of Fort Collins Comprehensive Annual Financial Report Trans- Trans- Perpetual Home Transit portation portation Recreation Cemeteries Care CDBG Program Services CEF Services $ - $ - $ - $ - $ - $ - $ - $ 8,178,557 - - - - - - - 312,127 22,755 - - 1,361,934 1,612,915 11,322,756 - 8,666,382 6,021,821 494,428 60,865 - - 972,935 7,781,081 5,184,881 50,663 8,108 23,670 656 694 (8,483) 279,907 379,807 171,367 15,421 - 159,550 389,594 60,795 18,894 147,890 6,266,606 517,957 84,535 1,522,140 2,003,203 12,348,003 8,079,882 22,869,644 - - - - - - - - 6,725,432 572,848 182 - - - - - - - - - - 14,986,532 386,624 26,803,536 - - - - - - - - - - - 1,536,739 1,705,006 - - - - - - - - - - - - - - - - - - - 589,798 7,157 - - - 378,516 2,092,909 513,268 - - - - - - - - - - - - - - - 2,426 7,315,230 580,005 182 1,536,739 1,705,006 15,365,048 2,479,533 27,319,230 (1,048,624) (62,048) 84,353 (14,599) 298,197 (3,017,045) 5,600,349 (4,449,586) 641,344 184,912 - - - 9,045,274 219,919 3,594,171 (32,050) (16,243) (24,139) - - (64,100) (304,052) (1,554,156) 2,034 6,250 - - - 4,882 - 235,353 611,328 174,919 (24,139) - - 8,986,056 (84,133) 2,275,368 (437,296) 112,871 60,214 (14,599) 298,197 5,969,011 5,516,216 (2,174,218) 2,718,914 617,752 1,838,651 (140,368) 388,525 (1,782,601) 19,612,702 17,550,770 $ 2,281,618 $ 730,623 $ 1,898,865 $ (154,967) $ 686,722 $ 4,186,410 $ 25,128,918 $ 15,376,552 Special Revenue Funds (continued) City of Fort Collins Comprehensive Annual Financial Report 111 NON-MAJOR GOVERNMENTAL FUNDS COMBINING STATEMENT OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCES FOR THE YEAR ENDED DECEMBER 31, 2017 General General Imp. Timberline/ Total Improvement District No. 15 Prospect Special Parking District No. 1 Skyview SID #94 Revenues REVENUES Taxes $ - $ 288,646 $ 29,182 $ - $ 24,847,223 Licenses and permits - - - - 312,127 Intergovernmental 22,967 47,787 2,902 - 28,097,400 Fees and charges for services 2,611,588 - - - 30,403,164 Earnings on investments 19,937 7,067 1,908 3,158 1,449,558 Miscellaneous revenue 42,232 1,615 - 7,054 1,446,223 Total Revenues 2,696,724 345,115 33,992 10,212 86,555,695 EXPENDITURES Current operating Police services - - - - 2,368 Community services - - - - 18,039,071 Planning, development and transportation 1,959,849 54,946 584 - 44,192,071 Information and employee - - - - 5,805 Sustainability services - - - - 3,241,745 Other - - - 76,241 76,241 Intergovernmental Fire protection - - - - 1,631,089 Capital outlay 412,169 - - - 9,806,325 Debt service Principal - - - - - Interest and debt service costs - - - - 2,426 Total Expenditures 2,372,018 54,946 584 76,241 76,997,141 Excess of Revenues Over (Under) Expenditures 324,706 290,169 33,408 (66,029) 9,558,554 OTHER FINANCING SOURCES (USES) Transfers in 58,685 - - - 23,764,940 Transfers out (104,309) (55,000) - (84,108) (25,656,872) Sale of capital assets - - - - 479,916 Total Other Financing Sources (Uses) (45,624) (55,000) - (84,108) (1,412,016) Net Changes in Fund Balances 279,082 235,169 33,408 (150,137) 8,146,538 Fund Balances (Deficit)-January 1 1,516,953 601,584 153,259 150,137 90,808,481 Fund Balances (Deficit)-December 31 $ 1,796,035 $ 836,753 $ 186,667 $ - $ 98,955,019 Special Revenue Funds (continued) 112 City of Fort Collins Comprehensive Annual Financial Report Debt Service Fund Fort Collins Total Total Leasing Neighborhood Conservation Capital Non-major Corporation Parkland Trust Project Governmental $ - $ - $ - $ - $ 24,847,223 - - - - 312,127 - - 1,594,852 1,594,852 29,692,252 - 2,495,488 - 2,495,488 32,898,652 - 142,606 32,472 175,078 1,624,636 59,702 415 - 415 1,506,340 59,702 2,638,509 1,627,324 4,265,833 90,881,230 - - - - 2,368 - 2,818,526 510,241 3,328,767 21,367,838 - - - - 44,192,071 - - - - 5,805 - - - - 3,241,745 4,300 - - - 80,541 - - - - 1,631,089 - 282,861 581,666 864,527 10,670,852 4,174,658 - - - 4,174,658 451,497 - - - 453,923 4,630,455 3,101,387 1,091,907 4,193,294 85,820,890 (4,570,753) (462,878) 535,417 72,539 5,060,340 4,570,753 - - - 28,335,693 - (28,010) (26,749) (54,759) (25,711,631) - - - - 479,916 4,570,753 (28,010) (26,749) (54,759) 3,103,978 - (490,888) 508,668 17,780 8,164,318 - 10,160,268 2,504,410 12,664,678 103,473,159 $ - $ 9,669,380 $ 3,013,078 $ 12,682,458 $ 111,637,477 Capital Project Funds City of Fort Collins Comprehensive Annual Financial Report 113 CAPITAL EXPANSION FUND SCHEDULE OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCES-- ACTUAL AND BUDGET (NON-GAAP BUDGETARY BASIS) FOR THE YEAR ENDED DECEMBER 31, 2017 Final Actual Budget Variance REVENUES Programs Earnings on investments $ 325,310 $ 331,667 $ (6,357) Fees and charges for services 4,175,085 3,804,186 370,899 Proceeds from issuance of long-term debt 1,634,364 1,251,970 382,394 Total Revenues 6,134,759 5,387,823 746,936 EXPENDITURES Programs Capital Expansion-General 86,246 88,205 1,959 Community Parkland Capital Exp 5,743,087 8,706,902 2,963,815 Fire Capital Expansion 1,631,089 1,631,089 - Police Capital Expansion 377,368 377,368 - Total Expenditures 7,837,790 10,803,564 2,965,774 Excess (deficiency) of revenues over (under) expenditures (1,703,031) $ (5,415,741) $ 3,712,710 RECONCILIATION TO GAAP BASIS Proceeds From Advances (1,634,363) Net Change in Fund Balances (3,337,394) Fund Balances--January 1 21,168,688 Fund Balances--December 31 $ 17,831,294 114 City of Fort Collins Comprehensive Annual Financial Report SALES AND USE TAX FUND SCHEDULE OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCES-- ACTUAL AND BUDGET (NON-GAAP BUDGETARY BASIS) FOR THE YEAR ENDED DECEMBER 31, 2017 Final Actual Budget Variance REVENUES Programs Earnings on investments $ 30,685 $ 26,084 $ 4,601 Miscellaneous revenue 3,274 - 3,274 Taxes 8,172,280 8,230,100 (57,820) Total Revenues 8,206,239 8,256,184 (49,945) EXPENDITURES Programs Transfers to Funds 8,705,826 9,287,076 581,250 Total Expenditures 8,705,826 9,287,076 581,250 Excess (deficiency) of revenues over (under) expenditures (499,587) $ (1,030,892) $ 531,305 Fund Balances--January 1 1,248,124 Fund Balances--December 31 $ 748,537 City of Fort Collins Comprehensive Annual Financial Report 115 COMMUNITY CAPITAL IMPROVEMENT PROGRAM FUND SCHEDULE OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCES-- ACTUAL AND BUDGET (NON-GAAP BUDGETARY BASIS) FOR THE YEAR ENDED DECEMBER 31, 2017 Final Actual Budget Variance REVENUES Programs Earnings on investments $ 8,178,558 $ 8,230,100 $ (51,542) Taxes 70,011 - 70,011 Total Revenues 8,248,569 8,230,100 18,469 EXPENDITURES Projects (project level of budgetary control) City Park Train - 350,000 350,000 Club Tico Renovation 245,514 250,000 4,486 Nature in the City 164,683 400,000 235,317 Bus Stop Improvements 173,462 200,000 26,538 Bicycle Infrastructure Imprvmt 486,124 650,000 163,876 Bike/Ped Grade Separated Cross 52,170 1,500,000 1,447,830 Arterial Intersection Imprvmnt 192,505 700,000 507,495 Lincoln Avenue Bridge 5,153,059 5,541,000 387,941 Pedestrian Sidewalk - ADA 1,980,029 2,000,000 19,971 Affordable Housing Fund - 450,000 450,000 Total Expenditures 8,447,546 12,041,000 3,593,454 Excess (deficiency) of revenues over (under) expenditures (198,977) $ (3,810,900) $ 3,611,923 RECONCILIATION TO GAAP BASIS Prior Years' Project Expenses 1,416,174 Net Change in Fund Balances 1,217,197 Fund Balances--January 1 6,755,503 Fund Balances--December 31 $ 7,972,700 116 City of Fort Collins Comprehensive Annual Financial Report NATURAL AREAS FUND SCHEDULE OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCES-- ACTUAL AND BUDGET (NON-GAAP BUDGETARY BASIS) FOR THE YEAR ENDED DECEMBER 31, 2017 Final Actual Budget Variance REVENUES Progams Earnings on investments $ 213,232 $ 181,458 $ 31,774 Fees and charges for services 64,877 35,000 29,877 Intergovernmental 5,012,229 4,000,000 1,012,229 Miscellaneous revenue 316,001 165,000 151,001 Proceeds from sale of capital assets 229,283 - 229,283 Transfers 8,705,826 9,287,076 (581,250) Projects Intergovernmental 19,766 20,000 (234) Miscellaneous revenue 10,000 10,000 - Total Revenues 14,571,214 13,698,534 872,680 EXPENDITURES Progams Education 504,448 573,967 69,519 Enforcement 820,338 770,149 (50,189) Facility Operations 415,903 950,923 535,020 Land Conservation 7,360,733 16,819,075 9,458,342 Land Management 652,172 897,173 245,001 Program Management 1,083,735 1,102,821 19,086 Public Improvements 1,173,234 2,065,477 892,243 Resource Management 1,714,446 3,708,168 1,993,722 Projects Education 28,522 30,000 1,478 Total Expenditures 13,753,531 26,917,753 13,164,222 Excess (deficiency) of revenues over (under) expenditures 817,683 $ (13,219,219) $ 14,036,902 RECONCILIATION TO GAAP BASIS Prior Years' Project Expenses 27,493 Prior Years' Project Revenues (19,993) Total Reconciling Items 7,500 Net Change in Fund Balances 825,183 Fund Balances--January 1 16,013,686 Fund Balances--December 31 $ 16,838,869 City of Fort Collins Comprehensive Annual Financial Report 117 CULTURAL SERVICES AND FACILITIES FUND SCHEDULE OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCES-- ACTUAL AND BUDGET (NON-GAAP BUDGETARY BASIS) FOR THE YEAR ENDED DECEMBER 31, 2017 Final Actual Budget Variance REVENUES Programs Earnings on investments $ 43,227 $ 36,381 $ 6,846 Fees and charges for services 3,035,604 2,586,100 449,504 Miscellaneous revenue 47,640 35,000 12,640 Proceeds from issuance of long-term debt 2,100 - 2,100 Transfers 1,139,124 1,145,425 (6,301) Projects Intergovernmental 47,050 5,000 42,050 Miscellaneous revenue 200,008 54,518 145,490 Transfers 787,908 842,449 (54,541) Total Revenues 5,302,661 4,704,873 597,788 EXPENDITURES Programs Art in Public Places 101,827 192,629 90,802 Lincoln Center 3,834,881 3,652,813 (182,068) Projects Art in Public Places 642,725 1,142,515 499,790 Lincoln Center 100,326 85,000 (15,326) Total Expenditures 4,679,759 5,072,957 393,198 Excess (deficiency) of revenues over (under) expenditures 622,902 $ (368,084) $ 990,986 RECONCILIATION TO GAAP BASIS Prior Years' Project Expenses 369,690 Prior Years' Project Revenues (779,371) Total Reconciling Items (409,681) Net Change in Fund Balances 213,221 Fund Balances--January 1 2,396,202 Fund Balances--December 31 $ 2,609,423 118 City of Fort Collins Comprehensive Annual Financial Report RECREATION FUND SCHEDULE OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCES-- ACTUAL AND BUDGET (NON-GAAP BUDGETARY BASIS) FOR THE YEAR ENDED DECEMBER 31, 2017 Final Actual Budget Variance REVENUES Programs Earnings on investments $ 50,663 $ 45,627 $ 5,036 Fees and charges for services 6,021,821 5,954,885 66,936 Miscellaneous revenue 171,451 161,100 10,351 Sale of capital assets 1,950 - 1,950 Transfers 641,344 641,344 - Projects Intergovernmental 369,919 453,634 (83,715) Miscellaneous revenue - 7,500 (7,500) Total Revenues 7,257,148 7,264,090 (6,942) EXPENDITURES Programs Adult Programs & Senior Center 1,617,274 1,632,603 15,329 Child Development 236,943 298,286 61,343 City Park Pool 118,624 141,842 23,218 EPIC 1,761,568 1,809,816 48,248 Farm 319,659 322,803 3,144 NACC 757,158 773,355 16,197 Recreation Administration 1,063,772 1,187,717 123,945 Special Revenue Accounts 52,381 123,677 71,296 Sports 803,478 884,640 81,162 Projects Recreation Grants 955,377 1,086,134 130,757 Total Expenditures 7,686,234 8,260,873 574,639 Excess (deficiency) of revenues over (under) expenditures (429,086) $ (996,783) $ 567,697 RECONCILIATION TO GAAP BASIS Prior Years' Project Expenses 338,954 Prior Years' Project Revenues (347,164) Total Reconciling Items (8,210) Net Change in Fund Balances (437,296) Fund Balances--January 1 2,718,914 Fund Balances--December 31 $ 2,281,618 City of Fort Collins Comprehensive Annual Financial Report 119 CEMETERIES FUND SCHEDULE OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCES-- ACTUAL AND BUDGET (NON-GAAP BUDGETARY BASIS) FOR THE YEAR ENDED DECEMBER 31, 2017 Final Actual Budget Variance REVENUES Programs Earnings on investments $ 8,108 $ 7,335 $ 773 Fees and charges for services 494,428 396,000 98,428 Miscellaneous revenue 15,421 12,500 2,921 Sale of capital asset 6,250 - 6,250 Transfers 184,912 184,419 493 Total Revenues 709,119 600,254 108,865 EXPENDITURES Programs Grandview Cemetery 469,681 505,674 35,993 Roselawn Cemetery 110,324 101,737 (8,587) Dummy for 275 Transfer to 400 16,243 50,000 33,757 Total Expenditures 596,248 657,411 61,163 Excess (deficiency) of revenues over (under) expenditures 112,871 $ (57,157) $ 170,028 Fund Balances--January 1 617,752 Fund Balances--December 31 $ 730,623 120 City of Fort Collins Comprehensive Annual Financial Report PERPETUAL CARE FUND SCHEDULE OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCES-- ACTUAL AND BUDGET (NON-GAAP BUDGETARY BASIS) FOR THE YEAR ENDED DECEMBER 31, 2017 Final Actual Budget Variance REVENUES Programs Earnings on investments $ 23,670 $ 23,645 $ 25 Fees and charges for services 60,865 55,000 5,865 Total Revenues 84,535 78,645 5,890 EXPENDITURES Programs (fund level of budgetary control) Internal Admin Services 182 182 - Transfers to Funds 24,139 23,646 (493) Total Expenditures 24,321 23,828 (493) Excess (deficiency) of revenues over (under) expenditures 60,214 $ 54,817 $ 5,397 Fund Balances--January 1 1,838,651 Fund Balances--December 31 $ 1,898,865 City of Fort Collins Comprehensive Annual Financial Report 121 COMMUNITY DEVELOPMENT BLOCK GRANT FUND SCHEDULE OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCES-- ACTUAL AND BUDGET (NON-GAAP BUDGETARY BASIS) FOR THE YEAR ENDED DECEMBER 31, 2017 Final Actual Budget Variance REVENUES Programs Earnings on investments $ 656 $ - $ 656 Miscellaneous revenue 4,252 - 4,252 Earnings on investments 629 82,596 (81,967) Intergovernmental 7,862,167 9,377,225 (1,515,058) Miscellaneous revenue 1,975,062 2,186,217 (211,155) Total Revenues 9,842,766 11,646,038 (1,803,272) EXPENDITURES Projects CDBG FY 10-11 976,199 1,041,666 65,467 CDBG FY 12-13 1,300,366 1,073,914 (226,452) CDBG FY 13-14 1,434,844 1,296,922 (137,922) CDBG FY 14-15 902,432 940,596 38,164 CDBG FY 15-16 947,437 988,357 40,920 CDBG Grant PI FY13-14 263,718 713,635 449,917 CDBG Grant PI FY14-15 157,865 143,704 (14,161) CDBG Grant PI FY 15-16 233,634 233,634 - CDBG Grant PI FY 10-11 2,881 2,881 - CDBG FY 16-17 806,518 975,901 169,383 CDBG Grant FY 17-18 79,436 1,324,036 1,244,600 Total Expenditures 7,105,330 8,735,246 1,629,916 Excess (deficiency) of revenues over (under) expenditures 2,737,436 $ 2,910,792 $ (173,356) RECONCILIATION TO GAAP BASIS Prior Years' Project Expenses 5,568,592 Prior Years' Project Revenues (8,320,627) Total Reconciling Items (2,752,035) Net Change in Fund Balances (14,599) Fund Balances--January 1 (140,368) Fund Balances--December 31 $ (154,967) 122 City of Fort Collins Comprehensive Annual Financial Report HOME PROGRAM FUND SCHEDULE OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCES-- ACTUAL AND BUDGET (NON-GAAP BUDGETARY BASIS) FOR THE YEAR ENDED DECEMBER 31, 2017 Final Actual Budget Variance REVENUES Programs Earnings on investments $ 694 $ - $ 694 Miscellaneous revenue 339,878 - 339,878 Earnings on investments 40,182 - 40,182 Intergovernmental 4,733,853 5,890,416 (1,156,563) Miscellaneous revenue 2,527,078 2,268,485 258,593 Total Revenues 7,641,685 8,158,901 (517,216) EXPENDITURES Projects HOME FY 11-12 867,964 892,392 24,428 HOME FY 12-13 807,671 834,531 26,860 HOME FY 13-14 737,993 823,958 85,965 HOME FY 14-15 464,783 564,878 100,095 HOME FY 15-16 402,459 550,344 147,885 HOME FY15-16 PI 425,773 277,888 (147,885) HOME Grant PI FY 11-12 24,428 - (24,428) HOME Grant PI FY 12-13 55,318 22,629 (32,689) HOME Grant PI FY13-14 541,280 530,280 (11,000) HOME Grant PI FY14-15 567,809 498,405 (69,404) HOME FY 16-17 449,370 561,870 112,500 HOME Grant FY 17-18 312,334 886,344 574,010 Total Expenditures 5,657,182 6,443,519 786,337 Excess (deficiency) of revenues over (under) expenditures 1,984,503 $ 1,715,382 $ 269,121 RECONCILIATION TO GAAP BASIS Prior Years' Project Expenses 3,952,175 Prior Years' Project Revenues (5,638,481) Total Reconciling Items (1,686,306) Net Change in Fund Balances 298,197 Fund Balances--January 1 388,525 Fund Balances--December 31 $ 686,722 City of Fort Collins Comprehensive Annual Financial Report 123 TRANSIT SERVICES FUND SCHEDULE OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCES-- ACTUAL AND BUDGET (NON-GAAP BUDGETARY BASIS) FOR THE YEAR ENDED DECEMBER 31, 2017 Final Actual Budget Variance REVENUES Projects Earnings on investments $ 584,582 $ 649,048 $ (64,466) Fees and charges for services 12,472,862 11,986,686 486,176 Intergovernmental 79,812,352 83,320,783 (3,508,431) Miscellaneous revenue 1,083,582 937,058 146,524 Sales of capital assets 47,045 - 47,045 Transfers 94,158,415 94,328,920 (170,505) Total Revenues 188,158,838 191,222,495 (3,063,657) EXPENDITURES Projects 5307 Pass-Thru 6,032,003 7,799,881 1,767,878 5309 Capital 19,858,448 22,224,509 2,366,061 Additional Revenue Service 1,962,291 1,091,496 (870,795) CMAQ Capital 5,141,827 5,164,640 22,813 CSU Transit Center 675,558 806,066 130,508 DAR Operations 24,683,404 29,267,189 4,583,785 DAR Overhead 2,192,758 2,350,596 157,838 DAR Revenue 70 - (70) Dispatch Operations 3,826,852 3,792,211 (34,641) Downtown Transit Center 3,647,902 2,936,803 (711,099) Fixed Operations 83,599,653 92,099,690 8,500,037 Fixed Overhead 17,514,156 16,826,469 (687,687) Information Technology 3,484,954 2,803,380 (681,574) Marketing - GF 2,928,624 2,725,728 (202,896) MAX - Start Up & Testing 1,025,381 1,116,004 90,623 Safe Ride Home Program 579,436 543,541 (35,895) Safety/Training 6,171,124 4,275,556 (1,895,568) South Transit Center 108,717 596,475 487,758 Variable Revenue 15,975 - (15,975) Bike N Ride Shelter TAP Grant 4,539 210,000 205,461 Total Expenditures 183,453,672 196,630,234 13,176,562 Excess (deficiency) of revenues over (under) expenditures 4,705,166 $ (5,407,739) $ 10,112,905 RECONCILIATION TO GAAP BASIS Prior Years' Project Expenses 168,024,526 Prior Years' Project Revenues (166,760,681) Total Reconciling Items 1,263,845 Net Change in Fund Balances 5,969,011 Fund Balances--January 1 (1,782,601) Fund Balances--December 31 $ 4,186,410 124 City of Fort Collins Comprehensive Annual Financial Report TRANSPORTATION CAPTIAL EXPANSION FEE FUND SCHEDULE OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCES-- ACTUAL AND BUDGET (NON-GAAP BUDGETARY BASIS) FOR THE YEAR ENDED DECEMBER 31, 2017 Final Actual Budget Variance REVENUES Programs Fees and charges for services $ 7,781,081 $ 4,101,603 $ 3,679,478 Earnings on investments 279,907 248,336 31,571 Miscellaneous revenue 18,894 100,000 (81,106) Transfers 219,919 219,919 - Total Revenues 8,299,801 4,669,858 3,629,943 EXPENDITURES Programs Capital Outlay 2,092,909 4,911,262 2,818,353 Other 27,772 27,773 1 Other Purchased Services 128,182 155,135 26,953 Personnel Costs 163,164 202,094 38,930 Purchased Prof & Tech Services 31,820 93,750 61,930 Purchased Property Services 34,855 77,700 42,845 Supplies 831 5,950 5,119 Transfers 304,052 4,805,328 4,501,276 Total Expenditures 2,783,585 10,278,992 7,495,407 Excess (deficiency) of revenues over (under) expenditures 5,516,216 $ (5,609,134) $ 11,125,350 Fund Balances--January 1 19,612,702 Fund Balances--December 31 $ 25,128,918 City of Fort Collins Comprehensive Annual Financial Report 125 TRANSPORTATION SERVICES FUND STATEMENT OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCES-- ACTUAL AND BUDGET (NON-GAAP BUDGETARY BASIS) FOR THE YEAR ENDED DECEMBER 31, 2017 Final Actual Budget Variance REVENUES Programs Earnings on investments $ 379,807 $ 231,474 $ 148,333 Fees and charges for services 5,184,881 4,096,830 1,088,051 Intergovernmental 8,437,977 8,156,489 281,488 Licenses and permits 312,127 217,500 94,627 Miscellaneous revenue 151,335 52,500 98,835 Proceeds from issuance of long-term debt 231,910 - 231,910 Taxes 8,178,557 8,230,100 (51,543) Transfers 3,594,171 3,594,171 - Projects Intergovernmental 1,240,122 1,280,361 (40,239) Miscellaneous revenue 3,000 3,000 - Total Revenues 27,713,887 25,862,425 1,851,462 EXPENDITURES Programs (fund level of budgetary control) Engineering 2,489,514 2,711,659 222,145 FC Moves 566,099 646,951 80,852 PDT Administration 1,885,663 3,177,586 1,291,923 Streets 19,436,910 18,006,875 (1,430,035) Traffic 4,191,403 4,296,523 105,120 Projects (project level of budgetary control) FC Moves 1,015,003 1,034,991 19,988 Traffic Signal System Software 432,052 528,370 96,318 Total Expenditures 30,016,644 30,402,955 386,311 Excess of revenues over (under) expenditures (2,302,757) $ (4,540,530) $ 2,237,773 RECONCILIATION TO GAAP BASIS Prior Years' Project Expenses 1,143,256 Prior Years' Project Revenues (1,014,717) Total Reconciling Items 128,539 Net Change in Fund Balances (2,174,218) Fund Balances--January 1 17,550,770 Fund Balances--December 31 $ 15,376,552 The notes to the financial statements are an integral part of this statement. 126 City of Fort Collins Comprehensive Annual Financial Report PARKING SERVICES FUND SCHEDULE OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCES-- ACTUAL AND BUDGET (NON-GAAP BUDGETARY BASIS) FOR THE YEAR ENDED DECEMBER 31, 2017 Final Actual Budget Variance REVENUES Programs Earnings on investments $ 19,937 $ 8,014 $ 11,923 Fees and charges for services 2,611,588 2,180,000 431,588 Intergovernmental 22,967 60,000 (37,033) Miscellaneous revenue 42,232 61,000 (18,768) Transfers 58,685 65,000 (6,315) Total Revenues 2,755,409 2,374,014 381,395 EXPENDITURES Programs Parking Services 1,065,341 948,765 (116,576) Civic Center Parking Structure 922,888 1,082,976 160,088 Old Town Parking Structure 465,710 497,448 31,738 On-Street Pay Parking - 10,800 10,800 Harmony Park & Ride 13,793 60,000 46,207 Jefferson St Parking Structure 8,595 151,000 142,405 Total Expenditures 2,476,327 2,750,989 274,662 Excess (deficiency) of revenues over (under) expenditures 279,082 $ (376,975) $ 656,057 Fund Balances--January 1 1,516,953 Fund Balances--December 31 $ 1,796,035 City of Fort Collins Comprehensive Annual Financial Report 127 GENERAL IMPROVEMENT DISTRICT NO. 1 FUND SCHEDULE OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCES-- ACTUAL AND BUDGET (NON-GAAP BUDGETARY BASIS) FOR THE YEAR ENDED DECEMBER 31, 2017 Final Actual Budget Variance REVENUES Programs Earnings on investments $ 7,067 $ 4,693 $ 2,374 Intergovernmental 47,787 36,000 11,787 Miscellaneous revenue 1,615 - 1,615 Taxes 288,646 302,000 (13,354) Total Revenues 345,115 342,693 2,422 EXPENDITURES Programs Construction Services 18,180 25,000 6,820 Internal Admin Services 36 107 71 Other Prof & Tech Services 102 6,000 5,898 Professional & Technical 5,786 11,500 5,714 Rebates & Incentives 28,470 23,000 (5,470) Transfers to Funds 55,000 90,000 35,000 Utility Services 2,372 2,500 128 Total Expenditures 109,946 158,107 48,161 Excess (deficiency) of revenues over (under) expenditures 235,169 $ 184,586 $ 50,583 Fund Balances--January 1 601,584 Fund Balances--December 31 $ 836,753 128 City of Fort Collins Comprehensive Annual Financial Report GENERAL IMPROVEMENT DISTRICT NO. 15 - SKYVIEW FUND SCHEDULE OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCES-- ACTUAL AND BUDGET (NON-GAAP BUDGETARY BASIS) FOR THE YEAR ENDED DECEMBER 31, 2017 Final Actual Budget Variance REVENUES Programs Earnings on investments $ 1,908 $ 1,515 $ 393 Intergovernmental 2,902 2,100 802 Taxes 29,182 29,700 (518) Total Revenues 33,992 33,315 677 EXPENDITURES Programs Professional & Technical 584 1,000 416 Total Expenditures 584 1,000 416 Excess (deficiency) of revenues over (under) expenditures 33,408 $ 32,315 $ 1,093 Fund Balances--January 1 153,259 Fund Balances--December 31 $ 186,667 City of Fort Collins Comprehensive Annual Financial Report 129 TIMBERLINE/PROSPECT SID #94 SCHEDULE OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCES-- ACTUAL AND BUDGET (NON-GAAP BUDGETARY BASIS) FOR THE YEAR ENDED DECEMBER 31, 2017 Final Actual Budget Variance REVENUES Earnings on investments $ 3,158 $ 1,675 $ 1,483 Miscellaneous revenue 7,054 43,500 (36,446) Total Revenues 10,212 45,175 (34,963) EXPENDITURES Programs Other 76,241 42,000 (34,241) Transfers 84,108 74,000 (10,108) Total Expenditures 160,349 116,000 (44,349) Excess (deficiency) of revenues over (under) expenditures (150,137) $ (70,825) $ (79,312) Fund Balances--January 1 150,137 Fund Balances--December 31 $ - 130 City of Fort Collins Comprehensive Annual Financial Report FORT COLLINS LEASING CORPORATION FUND SCHEDULE OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCES-- ACTUAL AND BUDGET (NON-GAAP BUDGETARY BASIS) FOR THE YEAR ENDED DECEMBER 31, 2017 Final Actual Budget Variance REVENUES Programs Miscellaneous revenue $ 59,702 $ - $ 59,702 Transfers 4,570,753 4,629,978 (59,225) Total Revenues 4,630,455 4,629,978 477 EXPENDITURES Programs Debt Service 4,626,155 4,626,478 323 Other Prof & Tech Services 3,300 3,500 200 Professional & Technical 1,000 - (1,000) Total Expenditures 4,630,455 4,629,978 (477) Excess (deficiency) of revenues over (under) expenditures - $ - $ - Fund Balances--January 1 - Fund Balances--December 31 $ - City of Fort Collins Comprehensive Annual Financial Report 131 NEIGHBORHOOD PARKLAND FUND SCHEDULE OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCES-- ACTUAL AND BUDGET (NON-GAAP BUDGETARY BASIS) FOR THE YEAR ENDED DECEMBER 31, 2017 Final Actual Budget Variance REVENUES Programs Fees and charges for services $ 560,655 $ - $ 560,655 Projects Earnings on investments 2,339,622 2,445,915 (106,293) Fees and charges for services 17,059,540 17,833,096 (773,556) Intergovernmental 205,691 237,197 (31,506) Miscellaneous revenue 153,813 144,954 8,859 Transfers 122,707 422,707 (300,000) Total Revenues 20,442,028 21,083,869 (641,841) EXPENDITURES Programs Parkland & Administration Cost 560,653 685,550 124,897 Projects Avery Park Improvements 249,171 270,364 21,193 English Ranch Community Garden 39,566 39,566 - Lake Canal Neighborhood Park 5,286 5,300 14 Lee Martinez Park Addition 466,596 839,462 372,866 Maple Hill Park 1,826,658 2,681,061 854,403 New Park Site Development 2,033,704 2,926,914 893,210 New Site Acquisition 2,832,017 3,050,945 218,928 Romero 5,789 150,000 144,211 Side Hill Neighborhood Park 8,500 416,096 407,596 Trailhead Park 399,546 1,952,000 1,552,454 Radiant Neighborhood Park 2,053,980 2,233,820 179,840 Waters Way Repairs 49,871 56,996 7,125 9-11 Memorial Project 12,718 20,000 7,282 Impact Fee Analysis 41,908 60,532 18,624 Eastridge Park 1,580 10,000 8,420 Maple Hill Water Delivery 744,885 1,400,000 655,115 Streets Facility Park 3,673 500,000 496,327 Whitewater Neighborhood Park 42,814 200,000 157,186 Avery Pk Restroom ADA Upgrade 67,046 69,880 2,834 Total Expenditures 11,445,961 17,568,486 6,122,525 Excess (deficiency) of revenues over (under) expenditures 8,996,067 $ 3,515,383 $ 5,480,684 RECONCILIATION TO GAAP BASIS Prior Years' Project Expenses 8,316,565 Prior Years' Project Revenues (17,803,520) Total Reconciling Items (9,486,955) Net Change in Fund Balances (490,888) Fund Balances--January 1 10,160,268 Fund Balances--December 31 $ 9,669,380 132 City of Fort Collins Comprehensive Annual Financial Report CONSERVATION TRUST FUND SCHEDULE OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCES-- ACTUAL AND BUDGET (NON-GAAP BUDGETARY BASIS) FOR THE YEAR ENDED DECEMBER 31, 2017 Final Actual Budget Variance REVENUES Programs Intergovernmental $ 219,919 $ - $ 219,919 Projects Earnings on investments 348,116 847,878 (499,762) Intergovernmental 18,939,110 18,661,881 277,229 Total Revenues 19,507,145 19,509,759 (2,614) EXPENDITURES Programs Administration 219,918 224,293 4,375 Projects Fossil Creek Trail 5,307,190 5,380,866 73,676 Longview Corridor Trail 164,740 570,000 405,260 Trail Acquisition/Development 9,461,113 9,523,994 62,881 Trees Along the Trails 58,294 125,000 66,706 Fossil Creek Trail Underpass 1,082,212 1,123,253 41,041 Fossil Ck Trl-Shields/College 177,195 1,707,040 1,529,845 Front Range Trail 14,707 80,000 65,293 East Ridge Cost Share - 50,000 50,000 FC Trl/FC Dr to CF Prairie 1,056 - (1,056) Total Expenditures 16,486,425 18,784,446 2,298,021 Excess (deficiency) of revenues over (under) expenditures 3,020,720 $ 725,313 $ 2,295,407 RECONCILIATION TO GAAP BASIS Prior Years' Project Expenses 15,367,770 Prior Years' Project Revenues (17,879,822) Total Reconciling Items (2,512,052) Net Change in Fund Balances 508,668 Fund Balances--January 1 2,504,410 Fund Balances--December 31 $ 3,013,078 City of Fort Collins Comprehensive Annual Financial Report 133 GENERAL FUND COMBINING SCHEDULES General Fund Components General -- this is the government's primary operating fund. It accounts for all financial resources of the general government, except those required to be accounted for in another fund. Museum -- to account for revenues received from Fort Collins Museum of Discovery and General Fund subsidies used to promote cultural activities. Emergency Recovery -- to account for monies, including FEMA assistance, to offset costs associated with the 2013 floods. 134 City of Fort Collins Comprehensive Annual Financial Report GENERAL FUND COMBINING BALANCE SHEET DECEMBER 31, 2017 General Fund Museum Emergency Recovery Eliminations Consolidated ASSETS Cash and cash equivalents $ 11,719,640 $ 137,549 $ - $ - $ 11,857,189 Investments 47,458,984 807,232 - - 48,266,216 Receivables Property taxes 23,837,669 - - - 23,837,669 Sales and use taxes 8,734,644 - - - 8,734,644 Accounts, net 939,121 - - - 939,121 Interest 177,163 2,815 - - 179,978 Due from other funds 786,132 - - - 786,132 Advances to other funds 4,882,399 - - - 4,882,399 Inventory of real property held for resale 1,477,894 - - - 1,477,894 Total Assets 100,013,646 947,596 - - 100,961,242 LIABILITIES Accounts payable, accruals, and other 3,579,839 30,516 - - 3,610,355 Wages payable 2,334,164 31,054 - - 2,365,218 Due to other governments 107,692 - - - 107,692 Deposits held 20,000 - - - 20,000 Total Liabilities 6,041,695 61,570 - - 6,103,265 DEFERRED INFLOWS OF RESOURCES Unavailable revenue - property taxes 23,837,669 - - - 23,837,669 Unavailable revenue - grants 280,391 - - - 280,391 Total Deferred inflows of resources 24,118,060 - - - 24,118,060 FUND BALANCES (DEFICIT) Nonspendable 6,485,293 - - - 6,485,293 Restricted 12,050,803 - - - 12,050,803 Committed 375,452 - - - 375,452 Assigned 17,023,027 886,026 - - 17,909,053 Unassigned 33,919,316 - - - 33,919,316 Total Fund Balances (Deficit) 69,853,891 886,026 - - 70,739,917 Total Liabilities, Deferred Inflows of Resources and Fund Balances (Deficit) $ 100,013,646 $ 947,596 $ - $ - $ 100,961,242 City of Fort Collins Comprehensive Annual Financial Report 135 GENERAL FUND COMBINING SCHEDULE OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCES FOR THE YEAR ENDED DECEMBER 31, 2017 General Fund Museum Emergency Recovery Eliminations Consolidated REVENUES Taxes $ 109,330,572 $ - $ - $ - $ 109,330,572 Licenses and permits 3,809,880 - - - 3,809,880 Intergovernmental 14,052,239 - - - 14,052,239 Fees and charges for services 9,506,463 - - - 9,506,463 Fines and forfeitures 2,033,894 - - - 2,033,894 Earnings on investments 1,147,269 12,659 - - 1,159,928 Miscellaneous revenue 1,424,488 17 - - 1,424,505 Total Revenues 141,304,805 12,676 - - 141,317,481 EXPENDITURES Current operating Police services 36,927,099 - - - 36,927,099 Financial services 4,360,932 - - - 4,360,932 Community and operation 11,463,307 1,022,681 - - 12,485,988 Planning, development and transportation 8,856,489 - - - 8,856,489 Executive, legislative, and judicial 6,815,336 - - - 6,815,336 Employee and communications 17,298,851 - - - 17,298,851 Sustainability services 6,727,816 - - - 6,727,816 Other 1,695,009 - - - 1,695,009 Intergovernmental Fire protection 24,012,449 - - - 24,012,449 Capital outlay 4,022,277 - - - 4,022,277 Debt service Interest and debt service costs 497 - - - 497 Total Expenditures 122,180,062 1,022,681 - - 123,202,743 Excess (Deficiency) of Revenues Over (Under) Expenditures 19,124,743 (1,010,005) - - 18,114,738 OTHER FINANCING SOURCES (USES) Transfers in 1,329,931 1,006,179 476,908 (1,134,607) 1,678,411 Transfers out (27,102,100) - - 1,134,607 (25,967,493) Sale of capital assets 1,539,481 - - - 1,539,481 Total Other Financing Sources (Uses) (24,232,688) 1,006,179 476,908 - (22,749,601) Net Changes in Fund Balances (Deficit) (5,107,945) (3,826) 476,908 - (4,634,863) Fund Balances (Deficit)-January 1 74,961,836 889,852 (476,908) - 75,374,780 Fund Balances (Deficit)-December 31 $ 69,853,891 $ 886,026 $ - $ - $ 70,739,917 136 City of Fort Collins Comprehensive Annual Financial Report GENERAL FUND SCHEDULE OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCES-- ACTUAL AND BUDGET (NON-GAAP BUDGETARY BASIS) FOR THE YEAR ENDED DECEMBER 31, 2017 Original Final Actual Budget Budget Variance REVENUES Programs Taxes $ 109,330,572 $ 114,394,906 $ 110,194,564 $ (863,992) Licenses and permits 3,809,880 3,592,509 3,592,509 217,371 Intergovernmental 13,085,276 13,936,752 13,936,752 (851,476) Fees and charges for services 9,506,463 9,240,938 9,657,610 (151,147) Fines and forfeitures 2,033,894 2,127,000 2,127,000 (93,106) Earnings on investments 1,147,269 1,124,914 1,124,914 22,355 Miscellaneous revenue 1,423,488 1,030,135 1,061,597 361,891 Sale of capital assets 899,312 - 9,779 889,533 Sale of assets held for resale 640,169 - - 640,169 Transfers 1,329,931 627,874 1,354,823 (24,892) Projects Intergovernmental 3,523,578 - 3,885,545 (361,967) Miscellaneous revenue 278,333 - 300,760 (22,427) Total Revenues 147,008,165 146,075,028 147,245,853 (237,688) EXPENDITURES Programs (fund level of budgetary control) Community Services 12,237,847 12,444,538 13,682,179 1,444,332 Employee and communications 23,152,082 24,369,661 25,948,630 2,796,548 Executive, legislative, and judicial 6,739,941 6,579,829 6,948,388 208,447 Financial services 4,360,932 4,652,418 4,734,954 374,022 Fire protection 24,012,449 24,012,449 24,012,449 - Other 23,387,444 23,109,128 23,361,551 (25,893) Planning, development and transportation 9,895,314 10,888,472 11,312,685 1,417,371 Police services 38,207,102 41,194,534 42,603,253 4,396,151 Sustainability services 6,300,022 4,747,561 8,117,312 1,817,290 Projects (project level of budgetary control) Employee and communications - - 20,000 20,000 Executive, legislative, and judicial 373,015 - 438,820 65,805 Planning, development and transportation 392,803 - 477,201 84,398 Police services 2,164,686 - 3,005,709 841,023 Sustainability services 1,141,395 - 1,488,267 346,872 Community Services 289,158 - 295,760 6,602 Total Expenditures 152,654,190 151,998,590 166,447,158 13,792,968 Excess (deficiency) of revenues over (under) expenditures (5,646,025) $ (5,923,562) $ (19,201,305) $ 13,555,280 RECONCILIATION TO GAAP BASIS Prior Years' Project Expenses 3,372,028 Prior Years' Project Revenues (2,833,948) Total Reconciling Items 538,080 Net Change in Fund Balances (5,107,945) Fund Balances--January 1 74,961,836 Fund Balances--December 31 $ 69,853,891 City of Fort Collins Comprehensive Annual Financial Report 137 MUSEUM FUND (A SUB-FUND OF THE GENERAL FUND) SCHEDULE OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCES-- ACTUAL AND BUDGET (NON-GAAP BUDGETARY BASIS) FOR THE YEAR ENDED DECEMBER 31, 2017 Final Actual Budget Variance REVENUES Programs Earnings on investments $ 12,659 $ 12,075 $ 584 Miscellaneous revenue 17 50,000 (49,983) Transfers 1,006,179 1,006,179 - Projects Intergovernmental 127,680 138,933 (11,253) Total Revenues 1,146,535 1,207,187 (60,652) EXPENDITURES Programs (fund level of budgetary control) Capital Outlay - 300,000 300,000 Other - 18,070 18,070 Other Purchased Services 116,079 117,204 1,125 Personnel Costs 780,615 833,793 53,178 Purchased Prof & Tech Services 63,153 10,000 (53,153) Purchased Property Services 12,284 21,635 9,351 Supplies 50,550 78,550 28,000 Projects (project level of budgetary control) IMLS High Park Fire 126,904 138,933 12,029 Total Expenditures 1,149,585 1,518,185 368,600 Excess (deficiency) of revenues over (under) expenditures (3,050) $ (310,998) $ 307,948 RECONCILIATION TO GAAP BASIS Prior Years' Project Expenses 126,904 Prior Years' Project Revenues (127,680) Total Reconciling Items (776) Net Change in Fund Balances (3,826) Fund Balances--January 1 889,852 Fund Balances--December 31 $ 886,026 138 City of Fort Collins Comprehensive Annual Financial Report EMERGENCY RECOVERY FUND (A SUB-FUND OF THE GENERAL FUND) SCHEDULE OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCES-- ACTUAL AND BUDGET (NON-GAAP BUDGETARY BASIS) FOR THE YEAR ENDED DECEMBER 31, 2017 Final Actual Budget Variance REVENUES Programs Transfers $ 476,908 $ - $ 476,908 Projects - Transfers 496,160 2,500,000 (2,003,840) Intergovernmental 135,066 1,497,918 (1,362,852) Miscellaneous 66,339 6,233 60,106 Total Revenues 1,174,473 4,004,151 (2,829,678) EXPENDITURES Projects (project level of budgetary control) Other 1,815,429 5,621,841 3,806,412 Total Expenditures 1,815,429 5,621,841 3,806,412 Excess (deficiency) of revenues over (under) expenditures (640,956) $ (1,617,690) $ 976,734 RECONCILIATION TO GAAP BASIS Prior Years' Project Expenses 1,815,429 Prior Years' Project Revenues (697,565) Total Reconciling Items 1,117,864 Net Change in Fund Balances 476,908 Fund Balances--January 1 (476,908) Fund Balances--December 31 $ - City of Fort Collins Comprehensive Annual Financial Report 139 URBAN RENEWAL AUTHORITY COMBINING SCHEDULES URA Components URA - North College District-- to account for the tax increment financing for the operations and debit services of the Urban Renewal Authority - N. College District. URA - Prospect South TIF District-- to account for the tax increment financing for the operations and debit services of the Urban Renewal Authority - Prospect South TIF District. URA - Foothills Mall -- to account for the tax increment financing for the operations and debit services of the Urban Renewal Authority - Foothills Mall TIF District. 140 City of Fort Collins Comprehensive Annual Financial Report URBAN RENEWAL AUTHORITY FUND COMBINING BALANCE SHEET DECEMBER 31, 2017 North College Prospect South Foothills Mall Consolidated ASSETS Cash and cash equivalents $ 88,741 $ 41,103 $ 75,002 $ 204,846 Investments 509,138 228,706 447,262 1,185,106 Receivables Property taxes 1,835,225 528,599 2,891,707 5,255,531 Interest 1,815 1,642 22 3,479 Restricted - cash and cash equivalents 953,644 - - 953,644 Total Assets 3,388,563 800,050 3,413,993 7,602,606 LIABILITIES Accounts payable, accruals, and other 14,587 - 507,003 521,590 Wages payable 4,859 - - 4,859 Advance from other funds 2,035,211 4,882,399 - 6,917,610 Total Liabilities 2,054,657 4,882,399 507,003 7,444,059 DEFERRED INFLOWS OF RESOURCES Unavailable revenue - property taxes 1,835,225 528,599 2,891,707 5,255,531 Total Deferred inflows of resources 1,835,225 528,599 2,891,707 5,255,531 FUND BALANCES (DEFICIT) Restricted 953,644 - 15,283 968,927 Unassigned (1,454,963) (4,610,948) - (6,065,911) Total Fund Balances (Deficit) (501,319) (4,610,948) 15,283 (5,096,984) Total Liabilities, Deferred Inflows of Resources and Fund Balances (Deficit) $ 3,388,563 $ 800,050 $ 3,413,993 $ 7,602,606 City of Fort Collins Comprehensive Annual Financial Report 141 URBAN RENEWAL AUTHORITY FUND COMBINING SCHEDULE OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCES (DEFICIT) FOR THE YEAR ENDED DECEMBER 31, 2017 North College Prospect South Foothills Mall Consolidated REVENUES Taxes $ 1,689,687 $ 480,883 $ 1,451,478 $ 3,622,048 Earnings (loss) on investments 20,537 3,743 (56) 24,224 Total Revenues 1,710,224 484,626 1,451,422 3,646,272 EXPENDITURES Current operating Sustainability services 3,068,793 21,380 1,433,158 4,523,331 Debt service Principal 575,000 - - 575,000 Interest and debt service costs 455,843 242,476 - 698,319 Total Expenditures 4,099,636 263,856 1,433,158 5,796,650 Excess (Deficiency) of Revenues Over (Under) Expenditures (2,389,412) 220,770 18,264 (2,150,378) Net Changes in Fund Balances (Deficit) (2,389,412) 220,770 18,264 (2,150,378) Fund Balances (Deficit)-January 1 1,888,093 (4,831,718) (2,981) (2,946,606) Fund Balances (Deficit)-December 31 $ (501,319) $ (4,610,948) $ 15,283 $ (5,096,984) 142 City of Fort Collins Comprehensive Annual Financial Report URBAN RENEWAL AUTHORITY - NORTH COLLEGE DISTRICT SCHEDULE OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCES-- ACTUAL AND BUDGET (NON-GAAP BUDGETARY BASIS) FOR THE YEAR ENDED DECEMBER 31, 2017 Original Final Actual Budget Budget Variance REVENUES Programs Taxes $ 1,689,687 $ 1,462,412 $ 1,462,412 $ 227,275 Earnings (loss) on investments 20,537 89,358 89,358 (68,821) Proceeds from issuance of long-term debt - 2,503,939 2,503,939 - Total Revenues 1,710,224 4,055,709 4,055,709 158,454 EXPENDITURES Programs (fund level of budgetary control) Debt & Other Uses 1,030,843 3,580,600 3,580,600 2,549,757 Other Purchased Services 16,010 8,883 8,883 (7,127) Personnel Costs 127,173 110,022 110,022 (17,151) Purchased Prof & Tech Services 125,022 167,598 167,598 42,576 Purchased Property Services 2,800,041 - - (2,800,041) Supplies 547 1,000 1,000 453 Total Expenditures 4,099,636 3,868,103 3,868,103 (231,533) Excess (deficiency) of revenues over (under) expenditures (2,389,412) $ 187,606 $ 187,606 $ (73,079) Fund Balances--January 1 1,888,093 Fund Balances--December 31 $ (501,319) City of Fort Collins Comprehensive Annual Financial Report 143 URBAN RENEWAL AUTHORITY - PROSPECT SOUTH TIF DISTRICT SCHEDULE OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCES-- ACTUAL AND BUDGET (NON-GAAP BUDGETARY BASIS) FOR THE YEAR ENDED DECEMBER 31, 2017 Original Final Actual Budget Budget Variance REVENUES Programs Taxes $ 480,883 $ 449,860 $ 449,860 $ 31,023 Earnings (loss) on investments 3,743 13,453 13,453 (9,710) Total Revenues 484,626 463,313 463,313 21,313 EXPENDITURES Programs (fund level of budgetary control) Debt & Other Uses 395,063 369,551 369,551 (25,512) Purchased Prof & Tech Services 9,618 11,497 11,497 1,879 Purchased Property Services 11,762 11,762 11,762 - Total Expenditures 416,443 392,810 392,810 (23,633) Excess (deficiency) of revenues over (under) expenditures 68,183 $ 70,503 $ 70,503 $ (2,320) RECONCILIATION TO GAAP BASIS Principal Reduction--Advances 152,587 Net Change in Fund Balances 220,770 Fund Balances (Deficit)--January 1 (4,831,718) Fund Balances (Deficit)--December 31 $ (4,610,948) 144 City of Fort Collins Comprehensive Annual Financial Report URBAN RENEWAL AUTHORITY - FOOTHILLS MALL DISTRICT SCHEDULE OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCES-- ACTUAL AND BUDGET (NON-GAAP BUDGETARY BASIS) FOR THE YEAR ENDED DECEMBER 31, 2017 Original Final Actual Budget Budget Variance REVENUES Programs Taxes $ 1,451,478 $ 4,078,120 $ 4,078,120 $ (2,626,642) Earnings (loss) on investments (56) - - (56) Total Revenues 1,451,422 4,078,120 4,078,120 (2,626,698) EXPENDITURES Programs Purchased Prof & Tech Services 24,924 13,979 18,978 (5,946) Purchased Property Services 1,408,234 4,053,867 4,053,867 2,645,633 Total Expenditures 1,433,158 4,067,846 4,072,845 2,639,687 Excess (deficiency) of revenues over (under) expenditures 18,264 $ 10,274 $ 5,275 $ 12,989 Fund Balances (Deficit)--January 1 (2,981) Fund Balances (Deficit)--December 31 $ 15,283 City of Fort Collins Comprehensive Annual Financial Report 145 blank CAPITAL PROJECTS FUND INDIVIDUAL FUND BUDGET SCHEDULE Capital Projects Fund -- to account for financial resources to be used for the acquisition or construction of major capital facilities. Revenues and other financing sources are primarily derived from issuance of debt or transfers from other funds. 146 City of Fort Collins Comprehensive Annual Financial Report THIS PAGE INTENTIONALLY LEFT BLANK City of Fort Collins Comprehensive Annual Financial Report 147 CAPITAL PROJECTS FUND SCHEDULE OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCES-- ACTUAL AND BUDGET (NON-GAAP BUDGETARY BASIS) FOR THE YEAR ENDED DECEMBER 31, 2017 Final Actual Budget Variance REVENUES Programs Miscellaneous revenue $ 791 $ - $ 791 Transfers (3,313,540) - (3,313,540) Projects Earnings on investments 6,168,801 6,389,031 (220,230) Intergovernmental 92,070,156 101,253,683 (9,183,527) Miscellaneous revenue 13,051,479 13,929,829 (878,350) Proceeds from issuance of long-term debt 8,425,000 8,430,000 (5,000) Transfers 84,736,034 102,773,385 (18,037,351) Total Revenues 201,138,721 232,775,928 (31,637,207) EXPENDITURES Programs Transfers 162,000 162,000 - Projects Arthur Ditch M.P/Alt analysis 127,426 185,000 57,574 Block 32 redevelopment 320,579 439,000 118,421 BOB pedestrian plan/ADA improvement 1,083,923 1,083,947 24 BOB-intersection improvement and traffic sign 12,132,155 13,374,590 1,242,435 BOB-senior center expansion 6,796,848 6,802,533 5,685 City bridge program 3,469,618 4,057,144 587,526 Downtown Poudre river improvement 1,424,287 1,482,509 58,222 East community park 1,780,301 2,550,000 769,699 EPIC pool improvements 1,753,087 1,839,000 85,913 Gardens capital project 386,622 2,831,000 2,444,378 I-25 interchange design project 77,556 100,000 22,444 I-25/SH392 interchange 4,488,775 4,639,593 150,818 Integrated recycling facility 1,456,716 1,685,000 228,284 Lemay/Vine railroad crossing 558,684 2,694,723 2,136,039 Linden Street-Walnut/Jefferson 4,133 300,000 295,867 Mason Street transportation corridor 85,158,094 88,853,001 3,694,907 North College improvement-Conifer/Willox 11,700,239 13,997,690 2,297,451 NA office building 1,729,904 1,860,000 130,096 Northeast community park 7,000 2,060,000 2,053,000 Oak Street public restroom replacement 347,583 350,000 2,417 Pickle plant 18,524 75,364 56,840 Prospect/College intersection improvement 2,663,953 2,700,000 36,047 Railroad crossing replacement 614,391 1,119,903 505,512 Remington greenway implementation 435,561 450,000 14,439 Southeast community park 16,080,507 16,221,624 141,117 Traffic calming - capital 237,057 500,000 262,943 Trail acquisition/development-special funds 1,013,808 1,013,808 - Water craft course 57,604 150,000 92,396 (Continued on Next Page) 148 City of Fort Collins Comprehensive Annual Financial Report CAPITAL PROJECTS FUND (Continued) SCHEDULE OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCES-- ACTUAL AND BUDGET (NON-GAAP BUDGETARY BASIS) FOR THE YEAR ENDED DECEMBER 31, 2015 Final Actual Budget Variance Willow Street river district enhancements $ 123,607 $ 372,985 $ 249,378 WW public improvements 6,306,782 6,801,080 494,298 CCIP pedestrian/ADA 1,980,029 2,000,000 19,971 BOB-park improvements 107,157 1,703,622 1,596,465 Fossil Creek trail-College/Shields 1,000,000 1,000,000 - Expansion of shop 187,200 1,620,000 1,432,800 Sharp point connection 66,033 1,250,000 1,183,967 CCIP arterial intersection improvement 421,469 5,700,000 5,278,531 CCIP bike/pedestrian crossing 52,170 1,500,000 1,447,830 Parking structure 8,424,503 8,430,000 5,497 BOB-Timberline Road improvement-Drake/Prospect 4,517,534 5,087,102 569,568 Lincoln Avenue improvement-First/Lemay 6,381,675 7,056,397 674,722 BOB-bicycle plan implementation 352,897 355,498 2,601 CCIP City Park train 3,500 350,000 346,500 CCIP Club Tico renovation 242,014 250,000 7,986 CCIP Poudre river downtown project 154,333 6,332,456 6,178,123 Grandview mausoleum section 2 16,243 50,000 33,757 CCIP nature in the city 154,794 390,111 235,317 CCIP bus stop improvements 173,462 200,000 26,538 CCIP bicycle infrastructure improvement 486,124 650,000 163,876 CCIP Lincoln Avenue bridge 5,153,059 5,541,000 387,941 Suniga Improvements-College/Blondel 102,669 300,000 197,331 Riverside bridge replacement 364,509 2,456,223 2,091,714 Railroad Riverside corridor implementation 584 - (584) Willow Street improvements (1) - 1 Total Expenditures 192,859,281 232,973,903 40,114,622 Excess (deficiency) of revenues over (under) expenditures 8,279,440 $ (197,975) $ 8,477,415 RECONCILIATION TO GAAP BASIS Prior Years' Project Expenses 158,700,811 Prior Years' Project Revenues (169,288,222) Total Reconciling Items (10,587,411) Net Change in Fund Balances (2,307,971) Fund Balances--January 1 19,928,828 Fund Balances--December 31 $ 17,620,857 City of Fort Collins Comprehensive Annual Financial Report 149 THIS PAGE INTENTIONALLY LEFT BLANK 150 City of Fort Collins Comprehensive Annual Financial Report blank ENTERPRISE FUNDS INDIVIDUAL FUND BUDGET SCHEDULES Light and Power -- to account for operation of the City's electric utility. Water -- to account for the operation of the City's water utility. Wastewater -- to account for the operation of the City's wastewater utility. Storm Drainage -- to account for the City's storm drainage utility. Golf -- to account for operations of all City golf courses. City of Fort Collins Comprehensive Annual Financial Report 151 LIGHT AND POWER FUND SCHEDULE OF REVENUES, EXPENSES AND CHANGES IN NET POSITION ACTUAL AND BUDGET (NON-GAAP BUDGETARY BASIS) FOR THE YEAR ENDED DECEMBER 31, 2017 Final Actual Budget Variance REVENUES Programs Earnings on investments $ 522,721 $ 653,323 $ (130,602) Fees and charges for services 128,730,192 129,990,000 (1,259,808) Intergovernmental 225,524 220,000 5,524 Miscellaneous revenue 7,510,766 4,340,000 3,170,766 Sale of Capital Assets 116,551 - 116,551 Projects Intergovernmental 18,101,263 18,101,264 (1) Miscellaneous revenue 594,575 748,982 (154,407) Proceeds from issuance of long-term debt 16,500,000 17,000,000 (500,000) Total Revenues 172,301,592 171,053,569 1,248,023 EXPENSES Programs (fund level of budgetary control) L&P Energy Services 5,126,556 6,534,492 1,407,936 L&P Payments and Transfers 17,259,533 17,917,664 658,131 L&P Purchase of Power 92,892,983 95,340,052 2,447,069 L&P System Additions 6,633,601 6,368,507 (265,094) Light & Power Operations 10,034,801 10,390,802 356,001 Projects (project level of budgetary control) Art in Public Places 520,279 1,029,280 509,001 Service Center-L&P Parent 13,724,010 13,610,372 (113,638) Smart Grid Invest Grant 26,527,241 27,314,576 787,335 Substation Cap Proj 1,631,343 2,569,977 938,634 SW Enclave Sys Purchases 2,810 1,442,688 1,439,878 Underground Conversion 1,345,193 1,707,471 362,278 New Capacity-Duct Banks 4,085,829 4,012,394 (73,435) Substation Cap Prj - Parent - 877,952 877,952 New Capacity - Circuits 1,500,598 2,028,098 527,500 Dist. System Impr. & Replace 896,747 1,767,000 870,253 Operational Technology 235,404 2,490,000 2,254,596 CMMS–Maintenance Management 644,129 644,129 - 800 MHz Radio System 648,325 648,325 - Integrated Util Services Grant 79,887 125,000 45,113 Total Expenses 183,789,269 196,818,779 13,029,510 Excess (deficiency) of revenues over (under) expenses before reconciling items (11,487,677) $ (25,765,210) $ 14,277,533 RECONCILIATION TO GAAP BASIS Prior Years' Project Expenses 42,876,125 Prior Years' Project Revenues (35,195,838) Capital Outlay--Programs 15,458,501 Current Year's Project Expenses 409,065 Principal Reduction--Long-term Debt 1,733,265 Depreciation (10,325,278) Bond Amortization 60,808 Total Reconciling Items 15,016,648 Change in net position 3,528,971 Net Position--January 1 (as restated) 202,950,792 Net Position--December 31 $ 206,479,763 152 City of Fort Collins Comprehensive Annual Financial Report City of Fort Collins Comprehensive Annual Financial Report 153 WASTEWATER FUND SCHEDULE OF REVENUES, EXPENSES AND CHANGES IN NET POSITION ACTUAL AND BUDGET (NON-GAAP BUDGETARY BASIS) FOR THE YEAR ENDED DECEMBER 31, 2017 Final Actual Budget Variance REVENUES Programs Fees and charges for services $ 23,949,484 $ 22,260,000 $ 1,689,484 Fines and forefeitures 800 - 800 Earnings on investments 552,614 520,507 32,107 Miscellaneous revenue 4,027,354 1,670,000 2,357,354 Sale of Capital Assets 10,835 - 10,835 Projects Intergovernmental 1,782,146 1,163,044 619,102 Total Revenues 30,323,233 25,613,551 4,709,682 EXPENSES Programs (fund level of budgetary control) WW Minor Capital 847,451 1,045,135 197,684 WW Payments and Transfers 8,062,819 8,946,688 883,869 WW Trunk and Collection 2,027,771 1,963,347 (64,424) WW Water Quality 1,148,774 1,308,467 159,693 WW Water Reclamation 5,595,347 5,874,920 279,573 Projects (project level of budgetary control) 800MHz Radios 240,920 240,920 - Art in Public Places 280,707 823,545 542,838 CMMS–Maintenance Management 694,136 826,880 132,744 DWRF CIP Summary 1,502,061 5,427,497 3,925,436 MWRF Improvements 487,410 498,664 11,254 North College Sewer 555,778 729,256 173,478 Sludge Disposal Improv 394,139 759,885 365,746 Wtr Reclam Replcmnt Prgm 1,396,446 2,453,653 1,057,207 WW Collection Sys Replcmnt 5,378,844 6,714,488 1,335,644 WW Svc Ctr Improvements 3,314,058 3,668,741 354,683 Hoffman Mill Property Purchase 73,262 75,000 1,738 UV Disinfection System 5,438,404 5,900,000 461,596 2017-Dewatering Improvements 596,133 2,135,000 1,538,867 2017-Polut Control Master Plan 94,006 100,000 5,994 2017-Sludge Strain Press 207,922 720,000 512,078 2017-Inflow/Infiltration Study - 200,000 200,000 2017-Water Rec&Bio Master Plan 360,133 500,000 139,867 Total Expenses 38,696,521 50,912,086 12,215,565 Excess (deficiency) of revenues over (under) expenses before reconciling items (8,373,288) $ (25,298,535) $ 16,925,247 RECONCILIATION TO GAAP BASIS Prior Years' Project Expenses 10,178,475 Prior Years' Project Revenues (1,238,479) Capital Outlay--Programs 433,551 Current Year's Project Expenses 10,835,882 Principal Reduction--Long-term Debt 1,830,000 Depreciation (5,940,856) Bond Amortization 161,103 Total Reconciling Items 16,259,676 Change in net position 7,886,388 Net Position--January 1 (as restated) 170,722,746 Net Position--December 31 $ 178,609,134 154 City of Fort Collins Comprehensive Annual Financial Report STORM DRAINAGE FUND SCHEDULE OF REVENUES, EXPENSES AND CHANGES IN NET POSITION ACTUAL AND BUDGET (NON-GAAP BUDGETARY BASIS) FOR THE YEAR ENDED DECEMBER 31, 2017 Final Actual Budget Variance REVENUES Programs Earnings on investments $ 328,330 $ 350,414 $ (22,084) Fees and charges for services 16,755,272 16,210,000 545,272 Licenses and permits 27,100 - 27,100 Miscellaneous revenue 1,110,325 1,023,262 87,063 Proceeds from issuance of long-term debt 24,326 - 24,326 Transfers 2,556 2,556 - Projects Intergovernmental 4,454,470 5,752,574 (1,298,104) Total Revenues 22,702,379 23,338,806 (636,427) EXPENSES Programs (fund level of budgetary control) Stormwater Minor Capital 284,314 413,912 129,598 Stormwater Operations 3,483,726 3,559,686 75,960 SW Payments and Transfers 7,696,867 8,291,024 594,157 Projects (project level of budgetary control) 800 MHz Radio System 58,810 58,810 - Art in Public Places 203,269 454,249 250,980 CMMS–Maintenance Management 504,901 826,879 321,978 Flood Mapping/Stream Gagin 665,393 700,990 35,597 Hoffman Mill Land Purchase 97,553 100,000 2,447 McGlelland/Mail Crk Basin 5,000 68,267 63,267 Post Fire-Flood Warning Grant 18,184 23,841 5,657 Spring Crk Basin Improv 116,667 119,550 2,883 SW Basin Improvements 21,350,548 28,144,056 6,793,508 SW Developer Repays 608,918 688,944 80,026 SW Master Planning 2,044,836 2,160,208 115,372 Util Ser Cntr Add/Remodel 3,213,001 3,454,538 241,537 Stormwater Basin Improvements - 194,647 194,647 2017-Bucknghm & Lincln Outfall 200,000 200,000 - 2017-Prospect & College SW 709,100 750,000 40,900 2017-Remington St Storm Sewer 71,626 100,000 28,374 2017-Magnolia St Outfall Ph 1 213,411 300,000 86,589 2017-McClelnds Crk @ Twin Silo 442,789 450,000 7,211 Total Expenses 41,988,913 51,059,601 9,070,688 Excess (deficiency) of revenues over (under) expenses before reconciling items (19,286,534) $ (27,720,795) $ 8,434,261 RECONCILIATION TO GAAP BASIS Prior Years' Project Expenses 21,761,313 Prior Years' Project Revenues (4,444,409) Capital Outlay--Programs 223,285 Current Year's Project Expenses 7,744,497 Principal Reduction--Long-term Debt 3,602,726 Depreciation (2,716,948) Bond Amortization (68,315) Total Reconciling Items 26,102,149 Change in net position 6,815,615 Net Position--January 1 (as restated) 128,190,105 Net Position--December 31 $ 135,005,720 City of Fort Collins Comprehensive Annual Financial Report 155 GOLF FUND SCHEDULE OF REVENUES, EXPENSES AND CHANGES IN NET POSITION ACTUAL AND BUDGET (NON-GAAP BUDGETARY BASIS) FOR THE YEAR ENDED DECEMBER 31, 2017 Final Actual Budget Variance REVENUES Programs Fees and charges for services $ 3,435,768 $ 3,489,000 $ (53,232) Earnings (loss) on investments 16,090 16,710 (620) Miscellaneous revenue 44,598 41,000 3,598 Proceeds from lease purchase 3,319 - 3,319 Total Revenues 3,499,775 3,546,710 (46,935) EXPENSES Programs (fund level of budgetary control) Capital Outlay 26,246 26,246 - Debt and Other Uses 656,404 658,789 2,385 Other - 18,450 18,450 Other Purchased Services 203,246 202,329 (917) Personnel Costs 1,365,155 1,378,754 13,599 Purchased Prof and Tech Services 514,288 525,378 11,090 Purchased Property Services 316,060 316,258 198 Supplies 336,539 370,211 33,672 Transfers 61,078 61,078 - Total Expenses 3,479,016 3,557,493 78,477 Excess (deficiency) of revenues over (under) expenses before reconciling items 20,759 $ (10,783) $ 31,542 RECONCILIATION TO GAAP BASIS Current Year's Project Expenses 33,708 Principal Reduction--Long-term Debt 616,067 Depreciation (328,330) Bond Amortization 3,096 Total Reconciling Items 324,541 Change in net position 345,300 Net Position--January 1 5,653,073 Net Position--December 31 $ 5,998,373 156 City of Fort Collins Comprehensive Annual Financial Report INTERNAL SERVICE FUNDS COMBINING AND INDIVIDUAL FUND FINANCIAL STATEMENTS AND SCHEDULES Equipment -- to account for the fleet services provided to other funds of the City. Self-Insurance -- to account for self-insurance of property and liability claims. Data and Communications -- to account for the acquisition, operation, and maintenance of the City's telephone system, office automation system, and network backbone, as well as computer application services. Benefits -- to account for the self-insurance of employee health care benefits and other benefits provided to City employees. Utility Customer Service and Administration -- to account for customer and administrative services provided to the City's utility funds. City of Fort Collins Comprehensive Annual Financial Report 157 INTERNAL SERVICE FUNDS COMBINING STATEMENT OF NET POSITION DECEMBER 31, 2017 Data and Equipment Self Insurance Communications ASSETS Current Assets Cash and cash equivalents $ 684,889 $ 3,727,556 $ 695,753 Investments 4,017,729 2,714,828 4,082,794 Receivables Accounts 171,880 - 14,274 Interest 14,088 9,520 14,210 Prepaid item - 264,442 - Inventories of materials and supplies 644,126 - - Total Current Assets 5,532,712 6,716,346 4,807,031 Non-Current Assets Restricted - cash and cash equivalents 1,600,860 - - Land, water rights, other 30,126 - - Buildings, improvements and equipment 17,929,026 - 4,336,268 Accumulated depreciation (9,119,631) - (3,808,350) Total Non-Current Assets 10,440,381 - 527,918 Total Assets 15,973,093 6,716,346 5,334,949 LIABILITIES Current Liabilities Accounts payable 352,456 24,985 343,904 Interest payable 23,569 - 630 Wages payable 114,972 35,780 194,168 Compensated absences 131,273 34,530 412,239 Claims payable - 1,759,966 - Capital lease obligations 2,864,462 - 178,073 Total Current Liabilities 3,486,732 1,855,261 1,129,014 Non-Current Liabilities Postemployment benefits 464,718 - 259,403 Claims payable - 3,296,101 - Capital lease obligations 5,341,730 - 78,589 Total Non-Current Liabilities 5,806,448 3,296,101 337,992 Total Liabilities 9,293,180 5,151,362 1,467,006 DEFERRED INFLOWS OF RESOURCES Other pension related items 82,109 - 45,833 NET POSITION Net investment in capital assets 3,197,654 - 813,028 Restricted: fiscal agent 1,600,860 - - Unrestricted 1,799,290 1,564,984 3,009,082 Total Net Position $ 6,597,804 $ 1,564,984 $ 3,822,110 158 City of Fort Collins Comprehensive Annual Financial Report Utility Customer Benefits Service and Admin. Total $ 2,180,567 $ 1,042,797 $ 8,331,562 9,270,278 2,387,205 22,472,834 - 19,305 5,188 210,647 36,350 12,056 86,224 - - 264,442 - - 644,126 11,506,500 3,447,246 32,009,835 - - 1,600,860 - - 30,126 - 3,556,565 25,821,859 - (3,340,688) (16,268,669) - 215,877 11,184,176 11,506,500 3,663,123 43,194,011 534,407 164,644 1,420,396 - - 24,199 31,715 353,958 730,593 40,417 353,168 971,627 1,577,069 - 3,337,035 - - 3,042,535 2,183,608 871,770 9,526,385 81,746 1,068,478 1,874,345 - - 3,296,101 - - 5,420,319 81,746 1,068,478 10,590,765 2,265,354 1,940,248 20,117,150 14,443 188,781 331,166 - 215,877 4,226,559 - - 1,600,860 9,226,703 1,318,217 16,918,276 $ 9,226,703 $ 1,534,094 $ 22,745,695 City of Fort Collins Comprehensive Annual Financial Report 159 INTERNAL SERVICE FUNDS COMBINING STATEMENT OF REVENUES, EXPENSES AND CHANGES IN NET POSITION FOR THE YEAR ENDED DECEMBER 31, 2017 Data and Equipment Self Insurance Communications OPERATING REVENUES Charges for services $ 8,785,401 $ 3,382,460 $ 2,136,593 Other revenue 3,104,545 41,575 8,816 Total Operating Revenues 11,889,946 3,424,035 2,145,409 OPERATING EXPENSES Personal services 3,177,083 922,130 5,007,079 Contractual services 2,391,201 3,772,562 3,279,360 Commodities 2,852,477 170,029 1,463,860 Other 903,755 - 90,285 Depreciation 1,562,062 - 147,182 Total Operating Expenses 10,886,578 4,864,721 9,987,766 Operating Income (Loss) 1,003,368 (1,440,686) (7,842,357) NONOPERATING REVENUES (EXPENSES) Earnings on investments 64,962 48,988 63,052 Intergovernmental 136,006 - - Gain (loss) on sale of capital assets 146,794 - 3,550 Interest expense (192,585) - (6,518) Total Nonoperating Revenues (Expenses) 155,177 48,988 60,084 Income (Loss) Before Transfers 1,158,545 (1,391,698) (7,782,273) Capital contributions 190,880 - - Assumption of capital lease (2,414,547) - - Transfers in - 1,602,505 7,490,778 Transfers out (56,088) (202,632) - Change in Net Position (1,121,210) 8,175 (291,495) Net Position--January 1 as restated 7,719,014 1,556,809 4,113,605 Net Position--December 31 $ 6,597,804 $ 1,564,984 $ 3,822,110 160 City of Fort Collins Comprehensive Annual Financial Report Utility Customer Benefits Service and Admin. Total $ 31,131,861 $ 13,801,968 $ 59,238,283 40,412 1,348,694 4,544,042 31,172,273 15,150,662 63,782,325 824,675 9,419,926 19,350,893 26,120,309 3,948,688 39,512,120 34,049 417,131 4,937,546 476 89,940 1,084,456 - 73,146 1,782,390 26,979,509 13,948,831 66,667,405 4,192,764 1,201,831 (2,885,080) 84,880 12,959 274,841 - 6,137 142,143 - 2,500 152,844 - - (199,103) 84,880 21,596 370,725 4,277,644 1,223,427 (2,514,355) - - 190,880 - - (2,414,547) - 202,632 9,295,915 - (2,153,342) (2,412,062) 4,277,644 (727,283) 2,145,831 4,949,059 2,261,377 20,599,864 $ 9,226,703 $ 1,534,094 $ 22,745,695 City of Fort Collins Comprehensive Annual Financial Report 161 INTERNAL SERVICE FUNDS COMBINING STATEMENT OF CASH FLOWS FOR THE YEAR ENDED DECEMBER 31, 2017 Data and Equipment Self Insurance Communications CASH FLOWS FROM OPERATING ACTIVITIES Receipts from interfund services provided $ 8,613,521 $ 3,628,032 $ 2,153,379 Cash paid to employees for services (3,155,574) (908,712) (4,933,061) Cash paid to suppliers of goods and services (6,138,809) (3,431,940) (4,595,948) Other receipts 3,104,545 41,575 8,816 Net cash provided (used) by operating activities 2,423,683 (671,045) (7,366,814) CASH FLOWS FROM NONCAPITAL FINANCING ACTIVITIES Transfers from other funds - 1,602,505 7,490,778 Transfers to other funds (56,088) (202,632) - Net cash provided (used) by noncapital financing activities (56,088) 1,399,873 7,490,778 CASH FLOWS FROM CAPITAL AND RELATED FINANCING ACTIVITIES Proceeds from capital debt 3,396,700 - - Capital contributions 190,880 - - Purchases of capital assets (3,105,814) - (192,885) Principal paid on capital debt (2,772,796) - (253,007) Interest paid on capital debt (181,978) - (9,562) Proceeds from sales of capital assets 21,548 - 3,550 Grant proceeds from federal government 136,006 - - Net cash (used) by capital and related financing activities (2,315,454) - (451,904) CASH FLOWS FROM INVESTING ACTIVITIES Purchase of investments 571,785 (629,015) 627,244 Earnings received on investments 66,416 46,952 64,589 Net cash provided (used) by investing activities 638,201 (582,063) 691,833 Net increase (decrease) in cash and cash equivalents 690,342 146,765 363,893 Cash and cash equivalents, January 1 1,595,407 3,580,791 331,860 Cash and cash equivalents, December 31 $ 2,285,749 $ 3,727,556 $ 695,753 Reconciliation of operating income (loss) to net cash provided (used) by operating activities: Operating income (loss) $ 1,003,368 $ (1,440,686) $ (7,842,357) Adjustments to reconcile operating income (loss) to net cash provided by operating activities: Depreciation expense 1,562,062 - 147,182 (Increase) decrease in accounts receivable (171,880) 245,572 16,786 (Increase) in inventories (11,143) - - (Increase) decrease in prepaid item - 4,615 - (Increase) decrease in pension-related items 169,111 - 94,397 Increase (decrease) in accounts payable 19,767 (15,773) 237,557 Increase (decrease) in compensated absences payable (2,410) 3,893 43,711 Increase (decrease) in post-employment obligation (136,334) - (76,102) Increase in wages payable (8,858) 9,525 12,012 Increase (decrease) in claims payable - 521,809 - Net cash provided (used) by operating activities $ 2,423,683 $ (671,045) $ (7,366,814) Noncash investing, capital, and financing activities: Bond proceeds transferred to escrow agent 2,414,547 - - Reconciliation of cash and cash equivalents to statement of net position: Cash and cash equivalents 684,889 3,727,556 695,753 162 City of Fort Collins Comprehensive Annual Financial Report Utility Customer Benefits Service and Admin. Total $ 31,131,295 $ 13,806,025 $ 59,332,252 (817,428) (9,303,927) (19,118,702) (26,616,666) (4,488,092) (45,271,455) 40,412 1,348,694 4,544,042 3,737,613 1,362,700 (513,863) - 202,632 9,295,915 - (2,153,342) (2,412,062) - (1,950,710) 6,883,853 - - 3,396,700 - - 190,880 - (145,897) (3,444,596) - - (3,025,803) - - (191,540) - 118,102 143,200 - 6,137 142,143 - (21,658) (2,789,016) (2,991,326) 1,471,614 (949,698) 70,277 13,636 261,870 (2,921,049) 1,485,250 (687,828) 816,564 875,582 2,893,146 1,364,003 167,217 7,039,278 $ 2,180,567 $ 1,042,799 $ 9,932,424 $ 4,192,764 $ 1,201,831 $ (2,885,080) - 73,146 1,782,390 (566) 4,057 93,969 - - (11,143) - - 4,615 29,746 388,817 682,071 (263,339) (32,333) (54,121) (6,682) 40,807 79,319 (23,981) (313,458) (549,875) 8,164 (167) 20,676 (198,493) - 323,316 $ 3,737,613 $ 1,362,700 $ (513,863) - 2,414,547 2,180,567 1,042,797 8,331,562 - - 1,600,860 $ 2,180,567 $ 1,042,797 $ 9,932,422 City of Fort Collins Comprehensive Annual Financial Report 163 EQUIPMENT FUND SCHEDULE OF REVENUES, EXPENSES AND CHANGES IN NET POSITION ACTUAL AND BUDGET (NON-GAAP BUDGETARY BASIS) FOR THE YEAR ENDED DECEMBER 31, 2017 Final Actual Budget Variance REVENUES Fees and charges for services $ 8,785,401 $ 10,450,436 $ (1,665,035) Earnings (loss) on investments 64,962 44,321 20,641 Miscellaneous revenue 787,706 3,031,799 (2,244,093) Sale of capital assets - 90,000 (90,000) Projects Intergovernmental 380,622 285,782 94,840 Total Revenues 10,018,691 13,902,338 (3,883,647) EXPENSES Programs (fund level of budgetary control) Compressed natural gas site 514,928 500,000 (14,928) Equipment shop 2,727,957 2,656,120 (71,837) Fleet fuel 2,392,425 3,221,246 828,821 Fleet pool rental 283,580 548,291 264,711 Fleet support services 622,333 620,742 (1,591) Fleet warehouse 76,131 73,132 (2,999) General fund equipment replacement 99,871 78,248 (21,623) Parks, forestry, horticulture vehicle replacement 460,588 513,823 53,235 Police equipment replacement 1,130,316 1,149,202 18,886 Streets shop 828,980 1,103,586 274,606 Transfort shop 2,019,065 2,233,138 214,073 PDT vehicle replacement 1,376,587 1,357,683 (18,904) Projects (project level of budgetary control) - Fleet services energy grants 543,626 305,167 (238,459) Total Expenses 13,076,387 14,360,378 1,283,991 Excess (deficiency) of revenues over (under) expenses before reconciling items (3,057,696) $ (458,040) $ (2,599,656) RECONCILIATION TO GAAP BASIS Prior years' project expenses 401,746 Prior years' project revenues (238,742) Capital outlay--programs 141,880 Current year's project expenses 903,755 Principal reduction--long-term debt 2,772,796 Proceeds from lease purchases (482,887) Depreciation (1,562,062) Total Reconciling Items 1,936,486 Change in net position (1,121,210) Net Position--January 1 (as restated) 7,719,014 Net Position--December 31 $ 6,597,804 164 City of Fort Collins Comprehensive Annual Financial Report SELF INSURANCE FUND SCHEDULE OF REVENUES, EXPENSES AND CHANGES IN NET POSITION ACTUAL AND BUDGET (NON-GAAP BUDGETARY BASIS) FOR THE YEAR ENDED DECEMBER 31, 2017 Final Actual Budget Variance REVENUES Programs Fees and charges for services $ 3,382,460 $ 3,326,751 $ 55,709 Earnings (loss) on investments 48,988 27,532 21,456 Miscellaneous revenue 41,576 - 41,576 Transfers 1,602,505 1,602,505 - Total Revenues 5,075,529 4,956,788 118,741 EXPENSES Programs (fund level of budgetary control) Risk management 4,369,425 4,859,629 490,204 Total Expenses 4,369,425 4,859,629 490,204 Excess (deficiency) of revenues over (under) expenses before reconciling items 706,104 $ 97,159 $ 608,945 RECONCILIATION TO GAAP BASIS Actuarial change (697,929) Change in net position 8,175 Net Position--January 1 1,556,809 Net Position--December 31 $ 1,564,984 City of Fort Collins Comprehensive Annual Financial Report 165 DATA AND COMMUNICATIONS FUND SCHEDULE OF REVENUES, EXPENSES AND CHANGES IN NET POSITION ACTUAL AND BUDGET (NON-GAAP BUDGETARY BASIS) FOR THE YEAR ENDED DECEMBER 31, 2017 Final Actual Budget Variance REVENUES Programs Fees and charges for services $ 2,136,593 $ 1,907,618 $ 228,975 Earnings (loss) on investments 63,052 52,552 10,500 Miscellaneous revenue 8,816 - 8,816 Sale of capital assets 3,550 - 3,550 Transfers 7,490,778 7,490,778 - Total Revenues 9,702,789 9,450,948 251,841 EXPENSES Programs (fund level of budgetary control) Application services 335,538 568,997 233,459 Data management services 1,038,821 996,033 (42,788) Dev tracking system 419,848 304,858 (114,990) E-Government services 462,080 541,389 79,309 E-Mail services 103,641 101,750 (1,891) Enterprise document management services 205,669 1,069,030 863,361 ERP services 1,488,344 1,381,749 (106,595) Geographic informational services 571,910 559,033 (12,877) Infra equipment replacement 1,889,572 2,207,169 317,597 IT administration 561,985 557,904 (4,081) IT client services 1,158,619 1,161,113 2,494 Network services 1,103,075 1,292,240 189,165 Non-enterprise equipment and support 147,200 372,010 224,810 Voice services 806,773 908,585 101,812 Total Expenses 10,293,075 12,021,860 1,728,785 Excess (deficiency) of revenues over (under) expenses before reconciling items (590,286) $ (2,570,912) $ 1,980,626 RECONCILIATION TO GAAP BASIS Current year's project expenses 192,966 Principal reduction--long-term debt 253,007 Depreciation (147,182) Total Reconciling Items 298,791 Change in net position (291,495) Net Position--January 1 (as restated) 4,113,605 Net Position--December 31 $ 3,822,110 166 City of Fort Collins Comprehensive Annual Financial Report BENEFITS FUND SCHEDULE OF REVENUES, EXPENSES AND CHANGES IN NET POSITION ACTUAL AND BUDGET (NON-GAAP BUDGETARY BASIS) FOR THE YEAR ENDED DECEMBER 31, 2017 Final Actual Budget Variance REVENUES Programs Fees and charges for services $ 31,131,385 $ 30,933,650 $ 197,735 Earnings (loss) on investments 84,880 103,378 (18,498) Miscellaneous revenue 40,412 200,000 (159,588) Total Revenues 31,256,677 31,237,028 19,649 EXPENSES Programs (fund level of budgetary control) Benefits 27,208,033 30,002,793 2,794,760 Total Expenses 27,208,033 30,002,793 2,794,760 Excess (deficiency) of revenues over (under) expenses before reconciling items 4,048,644 $ 1,234,235 $ 2,814,409 RECONCILIATION TO GAAP BASIS Actuarial change 229,000 Total Reconciling Items 229,000 Change in net position 4,277,644 Net Position--January 1 (as restated) 4,949,059 Net Position--December 31 $ 9,226,703 City of Fort Collins Comprehensive Annual Financial Report 167 UTILITY CUSTOMER SERVICE AND ADMINISTRATIVE FUND SCHEDULE OF REVENUES, EXPENSES AND CHANGES IN NET POSITION ACTUAL AND BUDGET (NON-GAAP BUDGETARY BASIS) FOR THE YEAR ENDED DECEMBER 31, 2017 Final Actual Budget Variance REVENUES Programs Intergovernmental 6,137 - 6,137 Fees and charges for services $ 13,808,475 $ 15,873,475 $ (2,065,000) Earnings (loss) on investments 12,959 4,639 8,320 Miscellaneous revenue 1,348,694 1,130,000 218,694 Other financing sources 2,500 - 2,500 Transfers 202,632 202,632 - Total Revenues 15,381,397 17,210,746 (1,829,349) EXPENSES Programs (fund level of budgetary control) Electric field services 223,036 316,439 93,403 Safety and security 107,265 142,632 35,367 Utilities electric systems eng div 809,375 815,347 5,972 Utilities enviro regulatory affairs 826,756 879,600 52,844 Utilities standards engineering div 88,148 171,201 83,053 Utilities customer connections 6,056,781 6,556,744 499,963 Utilities management 822,386 1,061,302 238,916 Utilities strategic planning 237,160 415,295 178,135 Utility financial operations 2,407,183 2,710,231 303,048 Utility tech and cust service 4,487,741 4,961,934 474,193 Total Expenses 16,065,831 18,030,725 1,964,894 Excess (deficiency) of revenues over (under) expenses before reconciling items (684,434) $ (819,979) $ 135,545 RECONCILIATION TO GAAP BASIS Current year's project expenses 30,297 Depreciation (73,146) Total Reconciling Items (42,849) Change in net position (727,283) Net Position--January 1 (as restated) 2,261,377 Net Position--December 31 $ 1,534,094 168 City of Fort Collins Comprehensive Annual Financial Report FIDUCIARY FUNDS COMBINING AND INDIVIDUAL FUND FINANCIAL STATEMENTS AND SCHEDULES Trust Funds: General Employees' Retirement Plan -- to account for the general employees' retirement plan. Closed to new hires as of 1/1/1999. Agency Funds: Poudre Fire Authority -- to account for cash and investments held by the City on behalf of Poudre Fire Authority. Poudre River Public Library District -- to account for cash and investments held by the City on behalf of Poudre River Public Library District. City of Fort Collins Comprehensive Annual Financial Report 169 GENERAL EMPLOYEES' RETIREMENT PLAN TRUST FUND SCHEDULE OF CHANGES IN NET POSITION HELD IN TRUST FOR PENSION BENEFITS - ACTUAL AND BUDGET FOR THE YEAR ENDED DECEMBER 31, 2017 Actual Budget Variance ADDITIONS Contributions $ 1,652,786 $ 1,770,000 $ (117,214) Earnings on investments 208,422 175,000 33,422 Change in the fair value of investments 6,824,288 - 6,824,288 Total Additions 8,685,496 1,945,000 6,740,496 DEDUCTIONS Benefit payments 3,720,322 5,200,000 1,479,678 Administration 26,752 27,750 998 Total Deductions 3,747,074 5,227,750 1,480,676 Net Increase (Decrease) in Plan Net Position 4,938,422 $ (3,282,750) $ 8,221,172 Net Position Held in Trust for Pension Benefits--January 1 43,869,310 Net Position Held in Trust for Pension Benefits--December 31 $ 48,807,732 170 City of Fort Collins Comprehensive Annual Financial Report blank AGENCY FUNDS COMBINING STATEMENT OF ASSETS AND LIABILITIES DECEMBER 31, 2017 Poudre River Poudre Public Total Fire Library Agency Authority District Funds ASSETS Cash and cash equivalents $ 2,481,618 $ 1,084,523 $ 3,566,141 Interest Receivable 45,518 21,896 67,414 Investments, at fair value U S Government securities 11,150,446 5,392,023 16,542,469 Corporate bonds 1,847,097 893,201 2,740,298 Total Investments, at fair value 12,997,543 6,285,224 19,282,767 Total Assets 15,524,679 7,391,643 22,916,322 LIABILITIES Amounts held for other governments 15,524,679 7,391,643 22,916,322 Total Liabilities $ 15,524,679 $ 7,391,643 $ 22,916,322 The notes to the financial statements are an integral part of this statement. City of Fort Collins Comprehensive Annual Financial Report 171 AGENCY FUNDS STATEMENT OF CHANGES IN ASSETS AND LIABILITIES FOR THE YEAR ENDED DECEMBER 31, 2017 POUDRE FIRE AUTHORITY Beginning Ending Balance Additions Deductions Balance ASSETS Cash and cash equivalents $ 2,208,451 $ 273,167 $ - $ 2,481,618 Receivables - interest 41,778 3,740 - 45,518 Investments, at fair value US government securities 10,820,897 329,549 - 11,150,446 Corporate bonds 1,607,897 239,200 - 1,847,097 Total Investments, at fair value 12,428,794 568,749 - 12,997,543 Total Assets 14,679,023 845,656 - 15,524,679 LIABILITIES Amounts held for other governments $ 14,679,023 $ 845,656 $ - $ 15,524,679 POUDRE RIVER PUBLIC LIBRARY DISTRICT Beginning Ending Balance Additions Deductions Balance ASSETS Cash and cash equivalents $ 478,274 $ 606,249 $ - $ 1,084,523 Receivables - interest 22,474 - 578 21,896 Investments, at fair value US government securities 5,817,561 - 425,538 5,392,023 Corporate bonds 864,442 28,759 - 893,201 Total Investments, at fair value 6,682,003 28,759 425,538 6,285,224 Total Assets 7,182,751 635,008 426,116 7,391,643 LIABILITIES Amounts held for other governments $ 7,182,751 $ 635,008 $ 426,116 $ 7,391,643 TOTAL - ALL FUNDS Beginning Ending Balance Additions Deductions Balance ASSETS Cash and cash equivalents $ 2,686,725 $ 879,416 $ - $ 3,566,141 Receivables - interest 64,252 3,740 578 67,414 Investments, at fair value US government securities 16,638,458 329,549 425,538 16,542,469 Corporate bonds 2,472,339 267,959 - 2,740,298 Total Investments, at fair value 19,110,797 597,508 425,538 19,282,767 Total Assets 21,861,774 1,480,664 426,116 22,916,322 LIABILITIES Amounts held for other governments $ 21,861,774 $ 1,480,664 $ 426,116 $ 22,916,322 172 City of Fort Collins Comprehensive Annual Financial Report COMPONENT UNIT FUNDS RECONCILIATIONS COMBINING AND INDIVIDUAL FUND FINANCIAL STATEMENTS AND SCHEDULES DOWNTOWN DEVELOPMENT AUTHORITY (DDA) Reconciliations: Reconciliation of the Balance Sheet to the Statement of Net Position Reconciliation of the Statement of Revenues, Expenditures and Changes in Fund Balances to the Statement of Activities Funds: General -- to account for all general operations of the DDA except those required to be accounted for in another fund. Debt Service -- to account for tax increment revenues received from property taxes and used to service the DDA's tax increment bonds. City of Fort Collins Comprehensive Annual Financial Report 173 COMPONENT UNIT RECONCILIATION OF THE BALANCE SHEET TO THE STATEMENT OF NET POSITION DECEMBER 31, 2017 Statement Total Adjustments of Net Position ASSETS Cash and cash equivalents $ 505,701 $ - $ 505,701 Investments 2,939,561 - 2,939,561 Receivables Property taxes 6,389,568 - 6,389,568 Accounts 6,385 - 6,385 Interest 10,497 - 10,497 Inventory of real property held for resale 135,464 - 135,464 Restricted investments 1,250,000 - 1,250,000 Capital assets (non-depreciable) - 2,528,747 1 2,528,747 Capital assets (net of accumulated depreciation) - 2,434,152 1 2,434,152 Total Assets 11,237,176 4,962,899 16,200,075 LIABILITIES Accounts payable 94,776 - 94,776 Interest payable - 17,099 2 17,099 Wages payable 19,164 - 19,164 Compensated absences - 15,424 15,424 Non-Current liabilities Due within one year - 2,053,122 2 2,053,122 Due after one year - 8,025,235 2 8,025,235 Total Liabilities 113,940 10,110,880 10,224,820 DEFERRED INFLOWS OF RESOURCES Unavailable revenue - property taxes 6,389,568 - 6,389,568 FUND BALANCES/NET POSITION Fund balances Nonspendable 135,464 Restricted 1,377,675 Assigned 3,220,529 Total Fund Balances 4,733,668 (5,147,981) (414,313) Total Liabilities, Deferred Inflows of Resources and Fund Balances $ 11,237,176 Net Position: Net investment in capital assets 4,962,899 Restricted for debt service 1,377,675 Unrestricted (deficits) 3 (6,754,887) Total Net Position (Deficit) of Component Unit (page 29) $ (414,313) 1 Capital assets net of accumulated depreciation used in governmental activities are not current financial resources Therefore they are not reported in the funds. 2 Long-term liabilities, including bonds payable, related interest, and compensated absences, are not due and payable in the current period and therefore not reported in the funds. 3 The component unit receives tax increment to service the bonds issued for improvements made within the downtown area. A majority of these improvements relate to building facades intended to preserve the historical architecture in the Old Town area of the City's downtown. Although the component unit may benefit over time from any increase in the assessed value of these properties related to these improvements, no assets are recorded in relation to these activities. As a result, the statement of net position for the component unit reflects a deficit balance for unrestricted net position. 174 City of Fort Collins Comprehensive Annual Financial Report COMPONENT UNIT RECONCILIATION OF THE STATEMENT OF REVENUES, EXPENDITURES, AND CHANGES IN FUND BALANCES TO THE STATEMENT OF ACTIVITIES FOR THE YEAR ENDED DECEMBER 31, 2017 Statement Total Adjustments of Activities Expenditures/Expenses (including transfers): Expenditures/expenses $ 7,041,625 $ (4,209,970) 1 $ 2,831,655 7,041,625 (4,209,970) 2,831,655 Program Revenues Charges for services 73,431 - 73,431 Operating grants and contributions 80,674 - 80,674 Net Program Revenues 154,105 - 154,105 Net Program Expense 6,887,520 (4,209,970) 2,677,550 General Revenues Property taxes 5,282,773 - 5,282,773 Investment earnings 55,686 - 55,686 Miscellaneous 2,386,789 (2,336,168) 2 50,621 Total General Revenues 7,725,248 (2,336,168) 5,389,080 Change in Net Position (pages 30-31) 837,728 1,873,802 2,711,530 Fund Balance/Net Position Beginning of the year 3,895,940 (7,021,783) (3,125,843) End of the year $ 4,733,668 $ (5,147,981) $ (414,313) 1 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 the governmental funds Net decrease in accrued interest related to last debt service payment (7,693) Net increase in compensated absences 1,341 Debt Payment (4,278,516) Fixed asset acquisitions reported as governmental expenditures (21,000) Current year depreciation 95,898 $ (4,209,970) 2 Proceeds from issuance of long term debt are not reported as revenues in the governmental funds. $ (2,336,168) City of Fort Collins Comprehensive Annual Financial Report 175 176 City of Fort Collins Comprehensive Annual Financial Report DOWNTOWN DEVELOPMENT AUTHORITY STATEMENT OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCES FOR THE YEAR ENDED DECEMBER 31, 2017 General Debt Service Total REVENUES Taxes $ 660,858 $ 4,621,915 $ 5,282,773 Licenses and permits 1,800 - 1,800 Intergovernmental 80,674 - 80,674 Fees and charges for services 71,631 - 71,631 Earnings on investments 28,238 27,448 55,686 Miscellaneous revenue 50,621 - 50,621 Total Revenues 893,822 4,649,363 5,543,185 EXPENDITURES Current operating Administrative 2,207,673 146 2,207,819 Debt service Principal - 4,539,125 4,539,125 Interest - 294,681 294,681 Total Expenditures 2,207,673 4,833,952 7,041,625 Excess (Deficiency) of Revenues Over (Under) Expenditures (1,313,851) (184,589) (1,498,440) OTHER FINANCING SOURCES (USES) Proceeds from issuance of long term debt 2,336,168 - 2,336,168 Total Other Financing Sources 2,336,168 - 2,336,168 Net Change in Fund Balances 1,022,317 (184,589) 837,728 Fund Balances-January 1 2,333,676 1,562,264 3,895,940 Fund Balances-December 31 $ 3,355,993 $ 1,377,675 $ 4,733,668 The notes to the financial statements are an integral part of this statement. City of Fort Collins Comprehensive Annual Financial Report 177 DOWNTOWN DEVELOPMENT AUTHORITY GENERAL FUND SCHEDULE OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCES-- ACTUAL AND BUDGET (NON-GAAP BUDGETARY BASIS) FOR THE YEAR ENDED DECEMBER 31, 2017 Final Actual Budget Variance REVENUES Programs Earnings on investments $ 28,238 $ 1,228 $ 27,010 Fees and charges for services 71,631 70,000 1,631 Intergovernmental 80,674 47,385 33,289 Licenses and permits 1,800 1,800 - Miscellaneous revenue 50,621 - 50,621 Proceeds from issuance of long-term debt 2,336,168 2,450,000 (113,832) Taxes 660,858 655,673 5,185 Total Revenues 3,229,990 3,226,086 3,904 EXPENDITURES Programs DDA - financed activities 1,472,507 4,130,308 2,657,801 Operation and maintenance DDA 735,166 835,283 100,117 Total Expenditures 2,207,673 4,965,591 2,757,918 Excess (deficiency) of revenues over (under) expenditures 1,022,317 $ (1,739,505) $ 2,761,822 Fund Balances--January 1 2,333,676 Fund Balances--December 31 $ 3,355,993 178 City of Fort Collins Comprehensive Annual Financial Report DOWNTOWN DEVELOPMENT AUTHORITY DEBT SERVICE FUND SCHEDULE OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCES-- ACTUAL AND BUDGET (NON-GAAP BUDGETARY BASIS) FOR THE YEAR ENDED DECEMBER 31, 2017 Final Actual Budget Variance REVENUES Taxes $ 4,621,915 $ 4,613,287 $ 8,628 Earnings (loss) on investments 27,448 21,495 5,953 Total Revenues 4,649,363 4,634,782 14,581 EXPENDITURES Debt service 4,833,806 4,937,890 104,084 Internal admin services 146 146 - Total Expenditures 4,833,952 4,938,036 104,084 Excess (deficiency) of revenues over (under) expenditures (184,589) $ (303,254) $ 118,665 Fund Balances--January 1 1,562,264 Fund Balances--December 31 $ 1,377,675 City of Fort Collins Comprehensive Annual Financial Report 179 THIS PAGE INTENTIONALLY LEFT BLANK STATISTICAL SECTION 180 City of Fort Collins Comprehensive Annual Financial Report Statistical Section This part of the City of Fort Collins 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 governments overall financial health. Financial Trends - These schedules contain trend information to help the reader understand how the City of Fort Collins’ financial performance and well-being have changed over time. Net Position by Component .............................................. Exh. A-1 ........................................................ 181 Changes in Net Position .................................................... Exh. A-2 ........................................................ 182 Fund Balances, Governmental Funds ............................... Exh. A-3 ........................................................ 183 Changes in Fund Balances, Governmental Funds ............ Exh. A-4 ........................................................ 184 Revenue Capacity - These schedules contain information to help the reader assess the City of Fort Collins’ most significant local revenue sources - Sales and Use taxes. Taxable Sales by Category ............................................... Exh. A-5 ........................................................ 185 Direct and Overlapping Sales Tax Rates .......................... Exh. A-6 ........................................................ 186 Sales Tax Revenue Taxpayers by Industry ....................... Exh. A-7 ........................................................ 187 Debt Capacity - These schedules present information to help the reader assess the affordability of the City of Fort Collins’ current levels of outstanding debt and its ability to issue additional debt in the future. Ratios of Outstanding Debt by Type ................................ Exh. A-8 ........................................................ 188 Ratios of General Bonded Debt Outstanding ................... Exh. A-9 ........................................................ 189 Direct and Overlapping Governmental Act. Debt ............ Exh. A-10 ...................................................... 190 Legal Debt Margin Information ........................................ Exh. A-11 ...................................................... 191 Pledged Revenue Coverage .............................................. Exh. A-12 ...................................................... 192 Demographic and Economic Information - These schedules offer demographics and economic indicators to help the reader understand the environment within which the City of Fort Collins financial activities take place. Demographic and Economic Statistics ............................. Exh. A-13 ...................................................... 194 Principal Employers .......................................................... Exh. A-14 ...................................................... 195 Full-time Equivalent City Emp. By Function/Program .... Exh. A-15 ...................................................... 196 Operating Information - These schedules contain service and infrastructure date to help the reader understand how the information in City of Fort Collins financial report relates to the services government provides and the activities it performs. Operating Indicators by Function/Program ...................... Exh. A-16 ...................................................... 198 Capital Asset Statistics by Function/Program .................. Exh. A-17 ...................................................... 198 Sources: Unless otherwise noted, the information in these schedules is derived from the comprehensive annual financial reports for the relevant year and/or city departments. City of Fort Collins Comprehensive Annual Financial Report 181 Net Position by Component (in thousands) Exhibit A-1 Last Ten Fiscal Years (accrual basis of accounting) 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 Governmental activities Net investment in capital assets $ 551,853 $ 573,887 $ 597,270 $ 628,758 $ 662,461 $ 694,119 $ 718,092 $ 754,652 $ 781,421 $ 829,571 Restricted 5,229 8,960 37,138 43,327 52,466 55,649 76,411 75,207 80,520 81,844 Unrestricted 161,680 146,408 113,086 107,784 119,944 145,207 153,205 161,718 166,301 161,214 Total governmental activities net position 718,762 729,256 747,494 779,869 834,870 894,974 947,708 991,577 1,028,243 1,072,629 Business-type activities Net investment in capital assets 429,392 453,420 466,364 490,511 508,284 531,113 564,294 595,216 646,367 679,667 Restricted 1,642 1,671 1,030 1,025 995 1,032 853 1,027 859 - Unrestricted 168,966 157,998 163,527 160,226 172,528 178,571 182,456 167,931 147,389 148,938 Total business-type activities net position 600,000 613,089 630,922 651,763 681,808 710,716 747,603 764,174 794,615 828,605 Primary government Net investment in capital assets 981,245 1,027,307 1,063,634 1,119,270 1,170,745 1,225,231 1,282,386 1,349,868 1,427,789 1,509,238 Restricted 6,871 10,631 38,168 44,352 53,461 56,681 77,264 76,234 81,379 81,844 Unrestricted 330,646 304,406 276,613 268,010 292,472 323,778 335,661 329,648 313,691 310,152 Total primary government net position $ 1,318,762 $ 1,342,345 $ 1,378,416 $ 1,431,631 $ 1,516,678 $ 1,605,690 $ 1,695,311 $ 1,755,751 $ 1,822,858 $ 1,901,234 Totals may not add due to rounding 182 City of Fort Collins Comprehensive Annual Financial Report Changes in Net Position (in thousands) Exhibit A-2 Last Ten Fiscal Years (accrual basis of accounting) Expenses 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 Governmental activities General government $ 33,535 $ 32,868 $ 29,752 $ 33,674 $ 34,645 $ 40,118 $ 36,434 $ 47,737 $ 46,706 $ 45,431 Public safety 46,521 50,056 48,854 51,313 55,633 56,660 57,686 61,018 64,852 73,945 Culture, parks, recreation and natural areas 35,490 38,515 27,342 29,755 32,448 40,910 37,165 35,423 47,315 44,396 Planning and development 6,585 9,706 14,331 11,053 9,502 13,547 11,160 11,241 13,982 20,594 Transportation 44,659 36,471 34,698 38,540 42,249 43,710 58,021 57,596 51,514 58,290 Interest on long-term debt 3,063 2,632 2,682 2,523 2,148 1,406 1,945 1,317 1,326 1,255 Total governmental activities expenses 169,852 170,247 157,659 166,857 176,625 196,352 202,411 214,332 225,695 243,912 Business-type activities Light and Power 81,620 83,888 91,693 97,057 101,513 116,639 116,911 124,304 131,780 133,285 Water 21,205 20,667 19,671 19,941 22,169 23,312 25,586 27,698 26,383 25,598 Wastewater 13,370 14,668 14,129 14,163 15,872 17,808 18,314 19,492 20,197 20,958 Storm drainage 9,021 9,426 8,307 8,407 8,119 9,428 9,196 9,287 9,913 10,805 Golf 2,507 2,387 2,454 2,547 2,661 2,758 3,306 3,169 3,208 3,142 Total business-type activities expenses 127,723 131,037 136,253 142,115 150,333 169,946 173,313 183,949 191,481 193,789 Total primary government expenses 297,575 301,284 293,911 308,973 326,958 366,298 375,724 398,281 417,177 437,700 Program revenues Governmental activities General government 12,962 8,863 6,782 7,479 6,458 6,944 8,807 15,194 15,980 15,786 Public safety 1,823 1,930 1,862 1,724 1,548 1,688 1,750 1,918 1,598 1,603 Culture, parks, recreation & natural areas 8,065 7,388 7,004 7,491 7,680 8,486 9,165 9,222 9,813 10,673 Planning and development 1,649 994 1,295 1,622 2,579 3,540 5,335 4,409 4,870 4,561 Transportation 12,003 8,577 8,101 6,926 11,147 12,108 13,409 9,833 12,356 16,280 Operating grants and contributions 6,917 7,998 8,240 13,712 9,284 10,075 6,958 8,737 11,277 17,013 Capital grants and contributions 7,775 25,717 16,014 14,784 31,678 49,585 28,040 17,788 14,788 19,379 Total governmental activities program revenues 51,194 61,467 49,298 53,737 70,374 92,426 73,464 67,102 70,683 85,296 Business-type activities Light and Power 83,521 84,253 94,235 100,814 109,776 115,879 115,412 118,780 126,466 130,198 Water 24,499 21,978 24,463 24,308 28,553 26,210 27,044 27,925 29,912 31,106 Wastewater 16,272 17,803 19,275 19,149 20,882 20,430 21,486 22,223 23,460 24,102 Storm drainage 13,576 13,631 13,869 13,946 14,082 14,396 14,835 15,070 15,696 16,807 Golf 2,644 2,608 2,676 2,672 3,096 2,921 3,270 3,499 3,430 3,474 Operating grants and contributions 24 112 220 131 6 30 8 74 260 - Capital grants and contributions 12,233 8,169 9,019 11,661 15,979 24,099 25,772 16,280 23,155 21,828 Total business-type activities program revenues 152,768 148,553 163,757 172,680 192,374 203,963 207,827 203,851 222,379 227,515 Total primary government program revenues 203,963 210,020 213,055 226,417 262,748 296,389 281,291 270,953 293,062 312,811 Net (expenses) revenue Governmental activities (118,658) (108,780) (108,360) (113,120) (106,251) (103,925) (128,947) (147,231) (155,013) (158,616) Business-type activities 25,046 17,517 27,504 30,565 42,042 34,017 34,514 19,902 30,898 33,727 Total primary government net expenses (93,612) (91,263) (80,857) (82,556) (64,210) (69,908) (94,434) (127,329) (124,115) (124,889) General revenues and other changes in net position Governmental activities Taxes: Sales and use taxes 75,865 70,501 74,719 97,589 109,732 111,846 129,088 134,899 136,087 135,621 Property taxes 16,683 17,038 17,833 17,742 18,188 18,485 19,155 19,988 22,822 25,097 Occupational privilege taxes 2,494 2,413 2,327 2,433 2,560 2,653 2,676 2,851 2,757 2,974 Lodging tax 833 736 808 909 1,012 1,103 1,305 1,451 1,453 1,521 Intergovernmental not restricted to programs 10,420 9,277 9,919 10,274 10,681 20,032 21,146 22,436 24,075 25,074 Investment earnings 9,043 3,655 2,367 2,601 1,998 537 3,142 7,497 1,541 3,826 Miscellaneous 14,400 1,394 787 1,019 1,246 2,991 3,211 2,912 708 4,387 Transfers 11,820 10,947 13,636 13,486 15,837 6,383 1,959 1,532 2,236 3,505 Total governmental activities 141,560 115,962 122,395 146,054 161,253 164,029 181,681 193,564 191,679 202,006 Business-type activities Intergovernmental not restricted to programs - - - - - - - - - 226 Investment earnings 9,583 4,727 2,585 2,919 2,227 466 2,330 2,113 890 2,220 City of Fort Collins Comprehensive Annual Financial Report 183 Fund Balances, Governmental Funds (in thousands) Exhibit A-3 Last Ten Fiscal Years (modified accrual basis of accounting) 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 General Fund Non Spendable $ 3,026 $ 16,616 $ 9,546 $ 8,519 $ 8,519 $ 7,897 $ 8,345 $ 7,196 $ 6,998 $ 6,485 Restricted 4,956 4,287 6,400 7,389 9,751 12,161 16,369 13,795 13,540 12,051 Committed 569 700 720 604 589 646 506 529 482 375 Assigned 13,008 5,015 4,929 7,348 12,439 10,403 23,709 20,715 20,963 17,909 Unassigned 23,897 10,977 19,330 16,307 23,956 29,012 25,744 30,708 33,391 33,919 Total general fund 45,456 37,594 40,924 40,167 55,253 60,120 74,674 72,943 75,375 70,740 All Other Governmental Funds Non Spendable - 1 6 7 5,311 5,313 5,317 5,314 5,382 89 Restricted 1,245 4,674 31,816 35,938 42,715 43,718 60,041 63,491 66,973 68,254 Committed 14,652 14,352 27,556 21,540 30,543 37,142 44,237 53,892 51,864 45,125 Assigned 89,859 87,415 30,269 30,978 23,447 31,444 26,902 21,497 22,899 24,397 Unassigned - (9,930) (4,703) (6,842) (14,592) (7,872) (9,397) (9,458) (11,183) 27,665 Total other governmental funds $ 105,755 $ 96,512 $ 84,944 $ 81,622 $ 87,424 $ 109,745 $ 127,099 $ 134,736 $ 135,935 $ 165,529 Totals may not add due to rounding 184 City of Fort Collins Comprehensive Annual Financial Report Changes in Fund Balances, Governmental Funds (in thousands) Exhibit A-4 Last Ten Fiscal Years (modified accrual basis of accounting) 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 Revenues Taxes $ 95,875 $ 90,689 $ 95,687 $ 118,673 $ 131,491 $ 134,086 $ 152,223 $ 159,188 $ 163,119 $ 165,214 Licenses and permits 1,493 1,013 1,236 1,554 2,184 3,040 4,645 3,924 4,001 4,122 Intergovernmental 26,998 29,802 37,520 34,738 53,192 68,696 49,779 45,717 38,362 48,076 Fees and charges for services 30,013 22,918 22,709 22,765 30,742 33,323 37,569 32,611 39,330 39,446 Fines and forfeitures 2,749 2,779 2,737 2,730 2,783 2,803 2,536 2,774 2,152 2,034 Earnings on investments 5,861 3,082 2,064 2,255 1,754 585 2,923 2,558 1,116 3,040 Securities lending income 1,809 103 6 - - - - - - 5,255 Miscellaneous revenue 4,408 2,472 2,684 8,835 4,224 6,275 5,229 4,203 3,767 Total Revenues 169,205 152,858 164,643 191,549 226,370 248,809 254,904 250,975 251,847 267,187 Expenditures Police services 28,424 29,269 30,490 31,231 34,512 34,805 35,617 36,619 38,755 41,822 Financial services 3,013 3,044 2,909 2,874 3,187 3,616 3,798 3,868 3,957 4,361 Community services 21,926 24,794 22,575 24,075 27,497 34,112 30,726 32,356 43,895 38,387 Planning, development and transportation 42,977 37,091 34,475 41,862 45,397 45,830 52,907 59,985 53,449 69,950 Executive, legislative, and judicial 4,945 4,306 4,675 4,390 4,639 5,370 5,945 6,850 6,940 6,832 Information and employee 13,034 10,873 8,749 10,813 10,996 12,627 12,371 14,375 15,773 17,601 Sustainability services 4,579 8,735 12,246 9,643 7,096 12,332 8,421 10,280 12,997 16,458 Other 1,995 1,177 1,717 1,318 1,682 1,753 1,320 2,368 1,314 1,776 Library 346 - - - - - - - - - Securities lending Interest 1,563 53 4 - - - - - - - Agent fees 57 28 1 - - - - - - - Intergovernmental Fire protection 16,383 17,224 17,458 18,994 19,283 20,065 20,753 22,280 24,058 29,006 Capital outlay 27,379 23,944 31,851 40,914 38,356 55,057 42,704 42,221 31,762 45,479 Debt service Principal 4,626 4,731 3,805 4,174 6,968 4,202 5,275 5,819 5,831 4,844 Interest and debt service costs 2,955 2,654 2,693 2,524 2,499 1,517 1,953 1,440 1,370 1,155 Total expenditures 174,201 167,923 173,650 192,811 202,111 231,287 221,790 238,462 240,101 277,670 Excess (deficiency) of revenues over (under) expenditures (4,996) (15,066) (9,007) (1,262) 24,259 17,522 33,115 12,513 11,746 (10,483) Other Financing Sources (Uses) Proceeds from issuance of long term debt 1,198 - - 976 35,092 12,909 3,190 239 - 8,425 Transfers in 114,237 115,086 35,457 39,128 41,781 33,445 40,033 50,047 42,056 46,696 Transfers out (117,769) (117,124) (39,156) (42,958) (46,030) (37,705) (44,496) (57,124) (50,246) (52,796) Sale of capital assets - - 265 37 181 1,018 67 230 75 2,019 Payments to escrow agent - (2) - - (34,395) - - - - - Total other financing sources (uses) (2,334) (2,040) (3,435) (2,817) (3,371) 9,667 (1,206) (6,608) (8,115) 4,344 Net change in fund balances $ (7,330) $ (17,106) $ (12,441) $ (4,079) $ 20,888 $ 27,188 $ 31,909 $ 5,906 $ 3,631 $ (6,139) Debt service as a percentage of noncapital expenditures 6.47% 5.52% 4.33% 4.13% 5.84% 2.96% 4.40% 3.67% 3.73% 2.48% Totals may not add due to rounding City of Fort Collins Comprehensive Annual Financial Report 185 Taxable Sales by Category Exhibit A-5 Last Ten Fiscal Years in millions of dollars 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 Sales Tax Category Grocery, Convenience, Liquor $ 359.8 $ 359.7 $ 363.8 $ 394.1 $ 429.0 $ 458.9 $ 488.3 $ 513.5 $ 530.3 $ 532.4 Restaurants, Caterers and Bars 285.9 285.4 295.6 315.4 337.9 353.1 380.2 408.8 427.7 448.3 General Merchandise 318.3 306.7 299.4 303.0 303.5 313.1 323.2 302.9 300.0 301.3 Building Materials, Garden Equipment & Supplies 138.4 130.2 142.9 154.8 165.9 186.1 221.5 226.4 230.0 241.8 Vehicle Sales, Parts and Repairs 162.9 149.3 160.0 164.5 180.6 193.6 221.4 228.5 227.6 235.3 Miscellaneous Retailers 110.0 103.9 110.4 116.4 121.7 131.0 138.6 146.9 169.8 202.7 Electronics and Appliances 117.7 107.8 111.9 118.2 122.1 126.0 150.7 163.0 156.6 154.4 Sporting, Hobby, Book, Music 126.0 126.1 129.2 134.5 134.9 137.3 140.5 149.2 144.8 137.1 Broadcasting and Telecommunications 113.7 113.0 119.0 116.7 117.2 108.0 111.8 115.2 124.7 121.4 Utilities 103.3 97.5 100.8 107.0 111.2 117.5 122.2 118.1 118.9 124.2 Clothing and Accessories 79.4 74.8 76.9 83.0 88.7 82.9 78.4 78.1 103.1 105.3 Pharmacy, Salon and Laundry 45.4 45.0 54.5 61.1 54.6 56.8 66.6 84.5 101.2 117.9 Other 47.2 43.0 44.3 45.9 51.0 53.7 58.6 63.3 70.3 75.2 Furniture and Home Furnishings 52.3 38.9 41.0 43.7 50.0 56.5 60.7 65.4 68.0 68.2 Rental and Leasing Services 52.1 46.4 43.1 42.7 46.3 44.5 52.0 59.3 66.5 67.6 Wholesale Trade 49.2 41.9 35.6 37.5 42.4 43.6 45.2 54.1 57.1 43.4 Lodging 33.9 29.1 32.2 35.2 40.2 42.1 49.8 54.9 53.5 56.0 Manufacturing 37.3 26.7 30.5 37.1 44.5 44.2 52.2 51.4 51.6 64.5 Total $2,232.8 $2,125.3 $2,191.2 $2,310.9 $2,441.7 $2,548.9 $2,761.9 $2,883.7 $3,001.7 $3,097.0 City direct sales tax rate* 3.00% 3.00% 3.00% 3.00% 3.85% 3.85% 3.85% 3.85% 3.85% 3.85% * Food sales city direct sales tax rate is 2.25% Totals may not add due to rounding 186 City of Fort Collins Comprehensive Annual Financial Report Direct and Overlapping Sales Tax Rates Exhibit A-6 Last Ten Fiscal Years Fiscal Year City Direct Rate* Larimer County State of Colorado 2008 3.00% 0.80% 2.90% 2009 3.00% 0.80% 2.90% 2010 3.00% 0.80% 2.90% 2011 3.85% 0.80% 2.90% 2012 ~ 3.85% 0.80% / 0.60% 2.90% 2013 3.85% 0.60% 2.90% 2014 3.85% 0.60% 2.90% 2015 3.85% 0.65% 2.90% 2016 3.85% 0.65% 2.90% 2017 3.85% 0.65% 2.90% * Food for home consumption sales direct rate is 2.25% ~Larimer County tax rate decreased from 0.8% to 0.6% effective July 1, 2012 City of Fort Collins Comprehensive Annual Financial Report 187 Sales Tax Revenue Taxpayers by Industry Exhibit A-7 Current Year and 2008 tax liability in thousands Fiscal Year 2017 Fiscal Year 2008 Number Percentage Tax Percentage Number Percentage Tax Percentage of Filers of Total Liability of Total of Filers of Total Liability of Total Grocery, convenience, liquor 651 5.31% $ 15,843 15.40% 465 4.42% $ 8,521 13.25% Restaurants, caterers and bars 290 2.37% 13,918 13.53% 189 1.80% 9,024 14.03% General merchandise 21 0.17% 9,320 9.06% 26 0.25% 8,883 13.81% Vehicle sales, parts and repairs 2,407 19.64% 8,588 8.35% 2,104 20.01% 4,143 6.44% Building materials, garden equipment and supplies 429 3.50% 8,337 8.10% 410 3.90% 4,872 7.57% Broadcasting and telecommunications 1,985 16.20% 7,004 6.81% 1,170 11.12% 3,274 5.09% Sporting, hobby, book, and music 392 3.20% 5,279 5.13% 288 2.74% 3,521 5.48% Miscellaneous retailers 356 2.91% 4,877 4.74% 422 4.01% 3,800 5.91% Utilities 13 0.11% 4,408 4.28% 12 0.11% 3,102 4.82% Electronics and appliances 308 2.51% 4,292 4.17% 277 2.63% 3,404 5.29% Pharmacy, salon and laundry 755 6.16% 4,114 4.00% 637 6.06% 1,316 2.05% Clothing and accessories 242 1.97% 3,726 3.62% 254 2.42% 2,370 3.68% Other 2,689 21.94% 2,619 2.55% 2,890 27.48% 1,406 2.19% Furniture and home furnishings 421 3.44% 2,417 2.35% 401 3.81% 1,562 2.43% Rental and leasing services 185 1.51% 2,385 2.32% 212 2.02% 1,558 2.42% Manufacturing 454 3.70% 2,257 2.19% 414 3.94% 1,089 1.69% Wholesale trade 359 2.93% 2,033 1.98% 24 0.23% 1,013 1.58% Lodging 297 2.42% 1,480 1.44% 322 3.06% 1,456 2.26% Total 12,254 100.00% $ 102,896 100.00% 10,517 100.00% $ 64,316 100.00% Note: Due to confidentiality issues, the names of the ten largest revenue payers are not available. The categories presented are intended to provide alternative information regarding the sources of the city's revenue. Totals may not add due to rounding 188 City of Fort Collins Comprehensive Annual Financial Report Ratios of Outstanding Debt by Type Last Ten Fiscal Years Exhibit A-8 in thousands Governmental Activities Business-Type Activities Certificates Assignment General Certificates Assignment Total Percentage Fiscal Revenue of of Lease Capital Obligation Revenue of of Lease Capital Primary of Personal Per Year Bonds Participation Payments Leases Bonds Bonds Participation Payments Leases Government Income Capita * 2008 $ 2,250 $ 55,340 $ 666 $ 2,636 $ 2,535 $ 81,618 $ 1,595 $ 2,117 $ 544 $ 149,301 2.8% 1.09 2009 985 52,225 628 1,736 - 102,440 1,470 1,995 381 161,860 3.1% 1.17 2010 670 49,100 587 1,015 - 109,884 1,360 1,868 227 164,711 3.0% 1.14 2011 340 45,870 545 2,755 - 100,380 1,230 1,734 245 153,098 2.7% 1.06 2012 - 41,845 501 3,719 - 90,007 1,095 1,594 208 138,968 2.3% 0.93 2013 11,085 37,905 455 5,872 - 79,597 950 1,448 271 137,583 2.1% 0.91 2014 10,833 33,815 407 7,790 - 71,514 795 1,295 651 127,100 1.9% 0.82 2015 9,995 29,630 357 8,781 - 60,995 620 1,134 608 112,120 1.5% 0.70 2016 9,435 25,365 304 8,190 - 49,838 425 966 720 95,243 1.2% 0.58 2017 $ 8,860 $ 29,410 $ 249 $ 8,463 - $ 39,960 $ 225 $ 790 $ 749 $ 88,705 N/A 0.53 Totals may not add due to rounding Note: Personal Income provided by the Bureau of Economic Analysis. Information is updated regularly and 2016 data was not available at the time this schedule was prepared. *These numbers are in thousands as rest of the table. In 2016 the 0.59 means $590.00 is the total debt per person City of Fort Collins Comprehensive Annual Financial Report 189 Ratios of General Bonded Debt Outstanding Exhibit A-9 Last Ten Fiscal Years Percentage of General Actual Taxable Fiscal Obligation Value of Per Year Bonds Property Capita 2008 2,535,000 0.02% 18 2009 - 0.00% - 2010 - 0.00% - 2011 - 0.00% - 2012 - 0.00% - 2013 - 0.00% - 2014 - 0.00% - 2015 - 0.00% - 2016 - 0.00% - 2017 - 0.00% - 190 City of Fort Collins Comprehensive Annual Financial Report Direct and Overlapping Governmental Activities Debt Exhibit A-10 As of December 31, 2017 in thousands Percentage Share of Debt Debt Applicable Applicable Outstanding 2 to the City 3 to the City Direct Debt City of Fort Collins 1 46,982 100.00% $ 46,982 Overlapping Debt Harmony Tech Park No. 1 4 - 100.00% - Harmony Tech Park No. 2 4 10,930 100.00% 10,930 Harmony Tech Park No. 3 4 - 100.00% - Mall Metro District 4 72,950 100.00% 72,950 Poudre R-1 School District 4 158,235 100.85% 159,586 Health District of Northern Larimer County - 101.49% - Poudre River Public Library 4 - 104.66% - Total Overlapping Debt 242,115 243,466 Total Direct and Overlapping Debt $ 289,097 $ 290,447 Estimated actual valuation $ 23,119,632 Assessed valuation $ 2,581,037 Net direct debt $ 46,982 Estimated overlapping debt $ 243,466 Net direct and estimated overlapping debt $ 290,447 Ratio of net direct debt to estimated actual valuation 0.2% Ratio of net direct debt to assessed valuation 1.8% Net direct debt per capita 5 $ 280 Ratio of net direct and estimated overlapping debt to estimated actual valuation 1.3% Ratio of net direct and estimated overlapping debt to assessed valuation 11.3% Net direct and estimated overlapping debt per capita 5 $ 1,734 Estimated actual valuation per capita 5 $ 138,028 Assessed valuation per capita 5 $ 15,409 1 2 Includes outstanding debt supported by general property taxes less available debt service monies. 3 4 Source: Governmental entity. 5 Determined by calculating ratio of assessed valuation of taxable property within the City to assessed valuation of the overlapping unit. Source for assessed valuations: Larimer County Assessor's Office. ASSESSED VALUATION, DEBT, AND DEBT RATIO DECEMBER 31, 2017 Includes all governmental activities outstanding debt supported by general property taxes less available debt service monies. Based on 2017 Population estimate per City of Fort Collins Planning Office--167,500. Per capita amounts are presented unrounded and not in thousands. City of Fort Collins Comprehensive Annual Financial Report 191 Legal Debt Margin Information Exhibit A-11 Last Ten Fiscal Years in thousands Assessed Valuation 1 $ 2,308,002 Debt limit - 10% of assessed value 230,800 Amount of debt applicable to limit: Total bonded debt (including special assessments) 50,038 Less: Assets in debt service funds available for payment of general obligation debt - Other deductions allowed by law: Downtown Development Authority tax increment bonds (10,078) Light and Power revenue bonds (5,270) Water revenue bonds (3,735) Storm drainage revenue bonds (9,405) Sewer revenue bonds (21,550) Net amount of debt applicable to debt limit 0 Legal debt margin $ 230,800 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 Debt Limit $ 175,881 $ 182,224 $ 181,595 $ 179,223 $ 179,603 $ 188,469 $ 193 $ 222,960 $ 230,800,217 $ 230,800 Total net debt applicable to limit - - - - - - - - - - Legal debt margin $ 175,881 $ 182,224 $ 181,595 $ 179,223 $ 179,603 $ 188,469 $ 193 $ 222.960 $ 230,800.217 $ 230,800.000 Total net debt applicable to the limit as a percentage of debt limit 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 1Source: Larimer County Assessor's Office. 192 City of Fort Collins Comprehensive Annual Financial Report Pledged Revenue Coverage Exhibit A-12 Last Ten Fiscal Years in thousands Net Revenue Gross Available for Revenues Expenses Debt Service Principal Interest Total Coverage 2008 89,499 79,266 10,232 - - - n/a 2009 88,490 82,132 6,359 - - - n/a 2010 99,951 91,483 8,468 - - - n/a 2011 109,106 96,124 12,982 - 235 235 n/a 2012 119,771 100,664 19,107 1,415 622 2,037 9.38 2013 129,264 108,976 20,287 1,455 580 2,035 9.97 2014 125,953 107,205 18,748 1,490 547 2,037 9.20 2015 125,308 114,156 11,152 1,520 514 2,034 5.48 2016 134,007 122,822 11,186 1,580 453 2,033 5.50 2017 137,106 122,757 14,348 1,757 303 2,059 6.97 WATER REVENUE BONDS Net Revenue Gross Available for Debt Service Requirements Revenues Expenses Debt Service Principal Interest Total Coverage 2008 33,922 15,823 18,098 2,402 1,409 3,810 4.75 2009 25,767 16,358 9,409 2,482 1,173 3,655 2.57 2010 27,289 16,582 10,707 2,633 1,034 3,667 2.92 2011 29,217 16,310 12,907 2,661 943 3,604 3.58 2012 33,061 19,235 13,825 2,755 841 3,596 3.85 2013 32,727 18,109 14,617 2,854 676 3,530 4.14 2014 37,579 18,629 18,950 2,569 510 3,079 6.15 2015 34,521 20,302 14,219 2,759 474 3,233 4.40 2016 37,911 20,004 17,908 2,871 326 3,197 5.60 2017 42,881 18,444 24,437 2,744 222 2,966 8.24 Net Revenue Gross Available for Revenues Expenses Debt Service Principal Interest Total Coverage 2008 21,844 10,434 11,410 4,081 1,005 5,087 2.24 2009 22,875 10,577 12,298 4,237 1,817 6,054 2.03 2010 22,170 12,117 10,053 3,378 1,704 5,081 1.98 2011 20,375 11,134 9,240 2,982 1,496 4,477 2.06 2012 23,520 11,658 11,862 3,099 1,459 4,557 2.60 2013 23,811 11,942 11,870 3,265 1,308 4,573 2.60 2014 26,258 11,586 14,672 1,640 1,217 2,857 5.14 2015 24,360 12,303 12,057 1,695 1,158 2,853 4.23 2016 28,376 14,072 14,305 1,760 328 2,088 6.85 2017 29,085 14,371 14,714 2,123 549 2,672 5.51 LIGHT AND POWER REVENUE BONDS WASTEWATER REVENUE BONDS Debt Service Requirements City of Fort Collins Comprehensive Annual Financial Report 193 Pledged Revenue Coverage Exhibit A-12 Last Ten Fiscal Years (continued) in thousands Net Revenue Gross Available for Revenues Expenses Debt Service Principal Interest Total Coverage 2008 15,139 4,865 10,274 2,610 2,483 5,093 2.02 2009 14,219 5,838 8,381 2,568 2,346 4,914 1.71 2010 14,613 5,052 9,560 2,683 1,606 4,289 2.23 2011 14,669 5,299 9,371 2,238 1,143 3,380 2.77 2012 15,729 5,064 10,664 2,965 1,102 4,067 2.62 2013 15,322 6,510 8,812 3,085 954 4,039 2.18 2014 17,742 5,749 11,993 3,203 840 4,042 2.97 2015 16,129 5,635 10,494 3,335 832 4,167 2.52 2016 20,387 6,771 13,616 3,465 699 4,164 3.27 2017 18,255 7,570 10,685 3,595 475 4,070 2.63 Totals may not add due to rounding Debt Service Requirements STORM DRAINAGE REVENUE BONDS 194 City of Fort Collins Comprehensive Annual Financial Report Demographic and Economic Statistics Exhibit A-13 Last Ten Fiscal Years Personal Per Income Capita Calendar (thousands Personal Unemployment Denver-Aurora Residential Year Population of dollars) Income Rate Lakewood CPI-U Building Permits 2008 136,427 11,378,132 38,848 5.0% 209.90 385 2009 138,100 11,149,957 37,368 6.6% 208.55 227 2010 143,986 11,600,000 38,585 7.4% 212.44 266 2011 144,875 12,149,896 39,767 6.8% 220.29 431 2012 148,700 12,826,581 41,311 6.4% 224.57 508 2013 151,330 13,545,018 42,866 5.4% 230.79 670 2014 155,400 14,126,667 43,584 4.3% 237.20 802 2015 160,935 15,118,879 45,318 3.3% 239.99 558 2016 162,919 16,019,414 47,117 2.8% 246.64 589 2017 167,500 n/a n/a 2.2% 255.00 649 Source: 3) Unemployment rate provided by the United States Department of Labor - Bureau of Labor Statistics. Average/year 4) CPI-U, annual, is provided by the US Bureau of Labor Statistics- Denver-Aurora-Lakewood area is the nearest region CPIU database changed from Denver-Boulder-Greeley to Denver-Aurora-Lakewood in 2017. Note: Information for personal income, per capita, and unemployment rate is based on the Fort Collins/Loveland regional area. 1) Population prior to 2009 provided by the Colorado State Demography Office. 2010 population is from the US Census 2009, 2011-2015 population is estimated by the Colorado State Demography Office; 2016 population is estimated by the City of Fort Collins Planning Department. 2) Personal income, and per capita personal income provided by the Bureau of Economic Analysis. Information is updated regularly and is subject to change. Data for 2017 was not available at the time this schedule was prepared. GeoName states 'Fort Collins, CO (Metropolitan Statistical Area)' 5) Number of residential building permits issued obtained from the City of Fort Collins Neighborhood and Building Services department. Single family detached and attached with the multi family City of Fort Collins Comprehensive Annual Financial Report 195 Principal Employers Exhibit A-14 2017 and Nine Years Ago Fiscal Year 2017 Fiscal Year 2009 * Percentage Percentage of Total City of Total City Employer Employees Rank Employment Employees Rank Employment Colorado State University 7,829 1 8.0% 6,755 1 7.8% Poudre R-1 School District 4,394 2 4.5% 3,929 2 4.5% UC Health: Poudre Valley Hospital 4,288 3 4.4% 2,832 3 3.3% City of Fort Collins 1,992 4 2.0% 1,795 5 2.1% Larimer County 1,855 5 1.9% 1,975 4 2.3% Broadcom (Avago) 1,244 6 1.3% 656 9 0.8% Woodward 1,201 7 1.2% 994 8 1.1% Employment Solutions Personnel 868 8 0.9% Otter Products, LLC 826 9 0.8% Department of Agriculture 789 10 0.8% Hewlett Packard 1,524 6 1.8% Anheuser Busch 609 10 0.7% Center Partners 1,081 7 1.2% Total 25,286 25.8% 22,150 25.4% *2008 data not available Source: United States Bureau of Labor and Statistics 196 City of Fort Collins Comprehensive Annual Financial Report Full-time Equivalent City Employees by Service Area/Department Exhibit A-15 Last Ten Fiscal Years Service Area/ Department 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 Financial Services 37 37 35 35 35 38 38 38 43 47 Executive Services 23 23 23 25 25 25 28 28 29 30 Judicial Services 7 7 7 8 8 7 8 8 9 10 Legal Services 11 11 12 12 12 12 15 17 18 19 Sustainability Services 11 12 13 15 19 25 26 25 32 33 Police Services Investigations 47 46 45 48 55 56 57 55 55 54 Police Information Systems 54 56 55 57 60 61 61 57 57 61 Patrol 134 135 140 144 149 153 159 161 164 167 Office of the Chief 14 14 14 15 16 18 18 18 19 20 Community & Operation Services Operation Services 65 67 63 65 70 72 73 72 78 81 Recreation 130 133 128 128 128 126 128 130 124 127 Cultural Services 44 48 42 46 50 56 55 51 53 56 Parks 130 132 127 132 135 138 139 135 142 148 Natural Areas 43 47 45 46 48 47 48 48 50 49 Library 3 - - - - - - - - - Planning, Development & Transportation Transfort / Parking Services 96 93 91 92 94 96 115 132 140 142 Comm Dev & Neighborhood Svcs 54 48 44 45 51 56 60 61 65 69 FC Moves 7 7 6 6 6 5 6 8 9 8 Streets 55 51 51 57 57 53 55 56 56 57 Traffic 30 29 26 29 30 28 27 26 28 29 Engineering 30 30 30 30 33 35 33 33 35 35 Information & Employee Services Information Technology 41 47 54 52 57 61 67 67 69 71 Comm. & Public Involvement 8 8 9 9 10 11 13 15 16 17 Human Resources 19 20 20 19 20 22 21 22 24 26 Utility Services Light & Power 93 103 104 107 108 107 107 112 110 108 Water 82 77 77 80 80 84 84 87 89 91 Wastewater 60 62 61 61 60 60 59 59 63 63 Storm Drainage 25 29 30 31 29 32 33 32 31 32 Customer Service & Admin. 97 97 91 88 92 93 93 88 93 92 Total City of Fort Collins 1,449 1,469 1,445 1,481 1,537 1,577 1,623 1,642 1,701 1,741 Note: Full time equivalents are based on filled positions using hours worked, excluding overtime, but including vacation, sick and holiday time. The data includes all employees , including exempt, not-exempt, with benefits, and without benefits. Vacancies are not included. Prior years restated due to reorganization, and data was missing compensation time used. Totals may not add due to rounding. City of Fort Collins Comprehensive Annual Financial Report 197 Operating Indicators by Function/Program Exhibit A-16 Last Ten Fiscal Years Function/Program 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 General Government Job applications processed 9,209 5,148 7,112 11,415 10,192 10,760 6,666 19,162 21,052 19,978 Warrants issued 1,010 798 1,231 1,370 1,379 1,146 874 723 952 920 Camera Radar completed cases 21,239 20,414 18,137 17,634 13,954 16,750 13,599 14,003 16,747 18,977 Public Safety Adult arrests 4,373 4,154 4,739 4,792 5,112 4,605 4,827 5,235 5,983 6,237 Juvenile arrests 809 811 849 675 610 553 658 767 587 589 Traffic violations 18,890 15,737 20,792 18,484 21,678 19,399 17,292 17,418 15,293 13,756 Number of fires per 1000 population 2.64 2.22 2.22 2.19 2.12 2.05 1.76 1.91 1.78 1.71 Total inspections per 1000 population 9.83 16.83 16.75 11.91 24.20 21.70 13.39 26.35 26.03 33 Average calls per week 259 266 276 299 306 317 339 367 403 427 Average response time 4:14 4:10 4:39 4:59 5:34 6:55 N/A N/A N/A N/A Minutes fire personnel are on scene 90% of the time N/A N/A N/A N/A N/A N/A 0.359027778 7:45 7:23 7:16 Culture, parks, recreation & natural areas Epic Pool & Ice attendance 373,809 353,161 480,586 385,426 364,459 465,615 361,276 354,486 294,860 323,231 City Park Pool attendance 91,444 77,276 74,821 75,755 66,651 60,138 49,155 52,545 51,311 46,764 Mulberry Pool attendance 98,640 117,033 167,810 202,148 134,358 148,641 57,260 57,149 65,168 71,578 Senior Center Pool attendance 32,980 55,765 21,179 25,775 29,236 32,599 20,213 24,627 24,415 25,461 Youth Activity Center attendance 712 1,090 24,207 31,171 46,202 41,666 11,951 N/A N/A Foothills Activity Center attendance N/A N/A N/A N/A N/A N/A N/A N/A 48,572 55,329 North Aztlan Center attendance 105,362 145,898 177,779 194,315 183,292 164,849 210,766 218,225 170,618 170,837 Farm attendance 79,730 61,166 61,737 61,336 62,736 57,502 60,077 62,326 66,648 66,969 Museum attendance 18,142 33,904 26,852 22,752 23,315 114,292 92,251 99,146 122,549 126,839 Scheduled park events 6,185 5,650 5,630 5,953 6,486 6,122 7,016 5,877 6,061 7,700 Planning and development Construction permits- single family units 254 153 177 258 469 630 743 509 522 583 Construction permits- multi family units 37 4 10 31 39 40 59 49 67 66 Transportation Transfort Passengers 1,884,194 1,994,229 2,034,195 2,156,775 2,271,732 2,296,511 2,611,642 3,266,194 4,089,206 4,306,807 Revenue miles 798,849 791,627 913,682 995,858 1,028,405 1,033,967 1,297,623 1,496,165 1,611,409 1,612,941 Revenue hours 68,356 69,984 75,564 77,356 78,551 78,741 103,232 118,846 126,380 129,438 Dial a Ride Passengers 44,135 41,719 40,385 37,851 37,747 34,121 34,533 35,450 34,005 29,594 Revenue miles 282,257 269,831 252,107 166,893 156,941 205,512 207,782 210,076 200,018 183,355 Revenue hours 25,092 23,456 21,690 20,407 19,429 17,770 17,642 18,229 17,741 16,062 Light & Power Customers 63,913 64,750 65,504 66,220 67,209 68,585 69,619 70,594 71,016 72,523 Electric use- megawatt hours 1,429,797 1,404,529 1,442,741 1,493,417 1,508,735 1,500,215 1,475,103 1,519,377 1,547,459 1,532,219 Peak demand- megawatts 285 264 282 292 302 295 281 291 304 311 Interruption index- minutes/year 10.00 10.99 17.27 21.73 16.84 9.58 25.54 20.60 18.83 15.95 Water Customers 33,082 32,910 32,983 33,074 33,147 33,348 34,290 34,744 35,092 35,279 Treated water delivered- acre feet 25,633 22,683 24,030 23,387 26,875 23,972 23,733 24,263 27,173 26,000 Peak day water use- million gallons/day 44.3 37.1 40.8 39.7 46.8 43.0 40.8 40.2 49.6 45.0 Water main breaks 59 79 139 97 108 92 80 116 111 97 Wastewater Customers 32,847 33,134 33,226 33,305 33,398 33,555 34,203 34,425 34,995 35,195 Average flow wastewater treated- million gallons/day 15.7 14.8 13.9 13.7 12.9 13.9 14.7 15.0 14.6 14.5 Recycled processed wastewater bio solids- dry tons 1,738 1,793 1,747 1,817 1,901 1,890 2,277 2,322 2,321 2,355 Industrial discharge permits 15 14 14 14 15 16 16 13 13 14 Storm Drainage Customers 40,554 40,911 40,813 41,395 42,020 42,589 43,609 44,388 45,008 45,589 Golf Rounds played 78,916 83,751 78,608 77,854 86,865 77,812 81,469 82,349 78,084 78,654 198 City of Fort Collins Comprehensive Annual Financial Report Capital Asset Statistics by Function/Program Exhibit A-17 Last Ten Fiscal Years Function/Program 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 General Government Administrative buildings 3 3 3 3 3 3 3 3 3 3 Municipal court 1 1 1 1 1 1 1 1 1 1 Public Safety Police stations 1 1 1 1 1 1 1 1 1 3 Police cars 224 232 225 281 284 270 257 260 279 259 Fire stations 13 13 13 13 13 13 13 13 13 13 Culture, parks, recreation & natural areas Swimming pools 4 4 4 4 4 4 4 4 4 4 Number of parks 46 46 46 46 48 49 49 49 49 49 Acreage of parks 861 861 861 861 871 878 878 878 879 939 Miles of hard surface trails 28.67 28.67 30.39 31.74 32.44 35.62 35.62 38.55 39.05 39.38 Planning and development Land Bank program- acres* 51 51 51 51 51 49 49 49 49 41 Land Bank program- yield of future affordable housing units* 513 446 510 510 510 490 490 490 490 410 Transportation Transit buses 27 29 44 34 40 34 44 54 56 58 Lane miles 1,796 1,796 1,796 1,796 1,861 1,901 1,901 1,922 1,922 1,957 Light & Power Underground distribution lines- miles 801.4 820.0 837.5 851.8 864.0 874.8 897.1 920.3 946.30 968.71 Overhead distribution lines- miles 6.7 7.0 8.4 10.6 10.7 10.7 10.3 9.5 5.81 4.69 Distribution substations 5 5 5 6 7 7 7 7 7 7 Distribution transformers 8,060 8,082 8,226 8,357 8,453 8,655 8,827 8,882 9,015 9,138 Water Water mains and distribution lines- miles of pipe 540 541 527 528 529 539 544 549 549 542 Hydrants 3,487 3,494 3,510 3,524 3,539 3,617 3,659 3,729 3,763 3,780 Plant capacity- millions gallons/day 87 87 87 87 87 87 87 87 87 87 Raw water storage- acre feet 7,161 7,161 7,161 7,161 7,161 7,161 7,161 7,161 7,161 9,100 Treated water storage- million gallons 35.5 35.5 35.5 35.5 35.5 35.5 35.5 35.5 36 36 Water rights owned- avg yield in acre feet/year 74,120 74,140 74,160 74,420 74,670 74,945 75,245 75,295 75,345 75,795 Wastewater Trunk and collection- miles of pipe 437 436 437 436 437 437 445 445 446 446 Plants- treatment capacity 29 29 29 29 29 29 29 29 29 29 Biosolids facility- acres 26,350 26,582 26,680 26,680 26,680 26,680 26,680 26,680 26,680 26,054 Storm Drainage City owned detention basins 90 90 90 90 90 90 90 105 106 108 City owned detention basins- acres 320 320 320 320 320 320 320 330 321 325 Regional drainage channels 69 69 69 69 69 69 69 69 69 69 Storm sewer manholes 2,968 3,265 2,568 3,524 3,640 3,909 3,909 4,271 4,326 4,372 Storm sewer pipeline- miles** 197.2 219.6 220.0 224.2 232.0 237.0 241.0 247.0 177.0 178.0 Golf Golf courses 3 3 3 3 3 3 3 3 3 3 City Park Nine- acres 56 56 56 56 56 56 56 56 56 56 Collindale- acres 160 160 160 160 160 160 160 160 160 160 SouthRidge-acres 128 128 128 128 128 128 128 128 128 128 * The Land Bank program acquires unimproved sites that are appropriate for affordable housing and holds them long-term (5 years minimum), which will ultimately be sold at discount to non-profit developers to build affordable housing projects. Land Bank code allows up to 12 dwelling units per acre; report has consistently used 10 bu's per acre **Miles for 2015 and prior includes storm drainage systems not maintained by the City. Miles for 2016 includes only City of Fort Collins maintained pipes. ***Unclear definition on police stations. For last 20 years have had 2 stations and added an addition one in 2017 ****Police cars includes 5 motorcycles, 1 bearcat and 1 accident callout vehicle as of 2017 data OTHER SCHEDULES City of Fort Collins Comprehensive Annual Financial Report 199 THIS PAGE INTENTIONALLY LEFT BLANK 200 City of Fort Collins Comprehensive Annual Financial Report ELECTRIC UTILITY ENTERPRISE TAX-EXEMPT REVENUE BONDS SERIES 2010A and 2010B SEC RULE 15c2-12 INFORMATION—CUSTOMER BASE and LARGEST UTILITY CUSTOMERS (UNAUDITED) Customer Base The Electric Utility System serves a customer base which has grown as follows in the years 2008 to 2017: Ten Largest Electric Utility Customers Years Electric Customers % Change 2008 63,913 1.5 2009 64,750 1.3 2010 65,507 1.2 2011 66,223 1.1 2012 67,212 1.5 2013 68,588 2.0 2014 69,621 1.5 2015 70,596 1.4 2016 71,327 1.0 2017 72,523 1.7 Customer Base Customer (NAICS code) Electric Charges for Services % of Total Electric University $ 10,136,594 7.9% Industrial 8,997,409 7.0% Industrial 5,095,370 4.0% Industrial 4,748,675 3.7% City Government 2,431,962 1.9% School District 1,658,976 1.3% Industrial 1,600,931 1.2% Hospitals 1,495,363 1.2% County 873,147 0.7% Industrial 629,760 0.5% Total Ten Largest Customers $ 37,668,188 29.3% (1) State laws prohibit disclosing the identity of the Enterprise's customers (2) Based on the total charges for electric services of $128,730,192 in 2017 2017 Ten Largest Electric Utility Customers City of Fort Collins Comprehensive Annual Financial Report 201 ELECTRIC UTILITY ENTERPRISE TAX-EXEMPT REVENUE BONDS SERIES 2010A and 2010B SEC RULE 15c2-12 INFORMATION—REVENUE BY CUSTOMER CLASS (UNAUDITED) The following table sets forth Electric Utility System’s sales and revenues by customer class for the past five years. 2013 2014 2015 2016 2017 Electric sales in MWH Residential 508,379 482,399 485,337 495,471 485,354 Commercial & Traffic Signals (1) 502,579 498,597 519,802 514,419 506,731 Industrial & Contract (2) 458,414 452,249 463,409 493,830 506,951 Total 1,469,372 1,433,245 1,468,548 1,503,720 1,499,036 Electric Revenues Residential $ 48,353,181 $ 46,813,927 $ 47,083,536 $ 50,029,684 $ 50,959,274 Commercial & Traffic Signals (1) 38,881,484 39,316,511 41,679,100 42,879,865 43,738,751 Industrial & Contract (2) 27,523,024 27,984,895 28,687,555 32,163,442 34,032,167 Total $ 114,757,689 $ 114,115,333 $ 117,450,191 $ 125,072,991 $ 128,730,192 Average Customer Accounts Residential 60,464 61,016 61,738 62,770 63,760 Commercial & Traffic Signals (1) 8,106 8,587 8,843 8,543 8,750 Industrial & Contract (2) 18 18 15 14 13 Total 68,588 69,621 70,596 71,327 72,523 Average Annual Use per Residential Customer 8,408 7,906 7,861 7,893 7,612 Annual Peak Demand (MW) 296 282 291 304 311 (1) Commercial accounts include all non residential customers with average monthly demands less than 750 kW. (2) Industrial accounts include all non residential customers with average monthly demands greater than 750 kW. Statistics by Customer Class 202 City of Fort Collins Comprehensive Annual Financial Report ELECTRIC UTILITY ENTERPRISE TAX-EXEMPT REVENUE BONDS SERIES 2010A and 2010B SEC RULE 15c2-12 INFORMATION—PLEDGED REVENUES AND CHANGES IN WORKING CAPITAL (UNAUDITED) Collections Although the Enterprise has not been required to calculate Gross Pledged Revenues, Operation and Maintenance Expenses and Net Pledged Revenues relating to the Electric Utility System prior to those terms being defined in the Bond Ordinance, the Enterprise has calculated what such amounts would have been for the fiscal years ended December 31, 2012 through 2017 as follows: 2012 2013 2014 2015 2016 2017 Gross Pledged Revenues (1) $ 119,770,757 $ 129,263,898 $ 125,953,186 $ 125,694,580 $ 132,198,698 $ 132,198,698 Operating and Maintenance Expense (2) 100,663,688 108,976,494 107,204,776 114,156,098 122,821,511 122,821,511 Net Pledged Revenues $ 19,107,069 $ 20,287,404 $ 18,748,410 $ 11,538,482 $ 9,377,187 $ 9,377,187 (1) For purposes of comparison with the five-year Comparative Statement of Revenue, Expenditures and Changes in Net Assets herein, Gross Pledged Revenues reflect "Total Revenues" less Transfers In. (2) For purposes of comparison with the five-year Comparative Statement of Revenue, Expenditures and Changes in Net Assets herein, Operating and Maintenance Expenses reflect "Total Expenditures" less Depreciation, Interest Expense and Transfers Out. Historical Net Pledged Revenues 2013 2014 2015 2016 2017 Current Assets $ 68,958,186 $ 70,157,741 $ 65,126,493 $ 52,523,574 $ 47,935,176 Current Liabilities 13,703,695 13,618,178 13,701,093 15,754,103 14,418,380 Working Capital $ 55,254,491 $ 56,539,563 $ 51,425,400 $ 36,769,471 $ 33,516,796 Change in Working Capital $ 3,355,443 $ 1,285,072 $ (5,114,163) $ (14,655,929) $ (3,252,675) Light and Power Fund Changes in Working Capital City of Fort Collins Comprehensive Annual Financial Report 203 ELECTRIC UTILITY ENTERPRISE TAX-EXEMPT REVENUE BONDS SERIES 2010A and 2010B SEC RULE 15c2-12 INFORMATION – OPERATING HISTORY (UNAUDITED) Operating History of the Light and Power Fund The following table sets forth the Comparative Statements of Revenue, Expenditures and Changes in Net Assets for the years ended December 31, 2013 through 2017: 2013 2014 2016 2017 REVENUES Charges for services $ 114,757,689 $ 114,114,704 $ 125,072,991 $ 128,730,192 Earnings on investments 74,170 620,546 249,907 522,721 Interest on security lending income - - - - Intergovernmental 933,688 112,218 337,380 225,524 Other revenue 1,417,461 1,768,063 1,808,474 1,925,171 Transfers In 86,147 87,888 67,000 - Gain on sale of capital assets (873,819) (181,901) 123,422 211,437 Contributed Capital 12,954,709 9,519,556 6,414,998 5,490,709 Total Revenues $ 129,350,045 $ 126,041,074 $ 134,074,172 $ 137,105,754 EXPENDITURES Personal services $ 7,676,785 $ 7,407,796 $ 7,936,963 $ 10,459,859 Contractual services 10,554,688 10,342,768 11,053,742 11,560,054 Commodities 81,723,155 81,711,589 94,439,663 91,471,848 Customer service and admin charges 4,683,584 5,126,811 6,500,603 5,832,953 Interest 483,529 447,728 324,879 258,998 Other 4,338,282 2,615,812 2,890,540 3,432,567 Depreciation 8,032,824 8,332,877 9,209,164 10,325,278 Transfers Out 129,845 16,897 103,715 235,226 Total Expenditures 117,622,692 116,002,278 132,459,269 133,576,783 Change in Net Assets 11,727,353 10,038,796 1,614,903 3,528,971 Net Assets -- January 1 177,687,691 189,415,044 201,087,112 Net Assets -- December 31 $ 189,415,044 $ 199,453,840 $ 202,702,015 206,479,763 (2) Net Assets -- January 1, 2017 beginning balance was adjusted, due to the adoption of GASB Statement No. 75 "Accounting and Financial Reporting for OPEB Liability" resulted in a restatement to recognize the liability expected to be liquidated with expendable available financial resources. 202,950,792 (2) CITY OF FORT COLLINS LIGHT AND POWER FUND 386,728 179,000 144,160 5,731,923 2015 $ 7,510,929 9,496,190 89,287,299 5,268,453 $ 125,873,580 $ 117,450,191 546,738 - 224,799 1,596,769 2,593,227 8,646,806 19,281 123,208,913 2,664,666 198,422,466 (1) 204 City of Fort Collins Comprehensive Annual Financial Report ELECTRIC UTILITY ENTERPRISETAX-EXEMPT REVENUE BONDS SERIES 2010A and 2010B SEC RULE 15c2-12 INFORMATION – COMPARISON AGAINST RECENT BUDGET (UNAUDITED) Budget Summary The following table shows the 2017 budgeted Statement of Net Assets compared against the 207 Actual Statement of Net Asset. Original Final Actual Budget Budget Variance REVENUES Programs Earnings on investments $ 522,721 $ 653,323 $ 653,323 $ (130,602) Fees and charges for services 128,730,192 126,490,000 129,990,000 (1,259,808) Intergovernmental 225,524 220,000 220,000 5,524 Miscellaneous revenue 7,510,766 4,340,000 4,340,000 3,170,766 Sale of Capital Assets 116,551 - - 116,551 Projects Intergovernmental 18,101,263 - 18,101,264 (1) Miscellaneous revenue 594,575 - 748,982 (154,407) Proceeds from issuance of long-term debt 16,500,000 - 17,000,000 (500,000) Total Revenues 172,301,592 131,703,323 171,053,569 1,248,023 EXPENSES Programs (fund level of budgetary control) L&P Energy Services 5,126,556 6,080,264 6,534,492 1,407,936 L&P Payments and Transfers 17,259,533 17,917,664 17,917,664 658,131 L&P Purchase of Power 92,892,983 91,582,500 95,340,052 2,447,069 L&P System Additions 6,633,601 5,666,141 6,368,507 (265,094) Light & Power Operations 10,034,801 10,187,223 10,390,802 356,001 Projects (project level of budgetary control) Art in Public Places 520,279 - 1,029,280 509,001 Maintenance Mgmt 13,724,010 - 13,610,372 (113,638) Electric Vehicle Charging Stn 26,527,241 - 27,314,576 787,335 Radios 1,631,343 - 2,569,977 938,634 Service Center-L&P Parent 2,810 - 1,442,688 1,439,878 Smart Grid Invest Grant 1,345,193 - 1,707,471 362,278 Substation Cap Proj 4,085,829 - 4,012,394 (73,435) SW Enclave Sys Purchases - - 877,952 877,952 Substation Cap Prj - Parent 1,500,598 - 2,028,098 527,500 Genisis64 SCADA Upgrade 896,747 - 1,767,000 870,253 New Capacity - Circuits 235,404 - 2,490,000 2,254,596 Dist. System Impr. & Replace 644,129 - 644,129 - Operational Technology 648,325 - 648,325 - CMMS–Maintenance Management 79,887 - 125,000 45,113 Total Expenses 183,789,269 131,433,792 196,818,779 13,029,510 Excess (deficiency) of revenues over (under) expenses before reconciling items (11,487,677) $ 269,531 $ (25,765,210) $ 14,277,533 RECONCILIATION TO GAAP BASIS Prior Years' Project Expenses 42,876,125 Prior Years' Project Revenues (35,195,838) Capital Outlay--Programs 15,458,501 Current Year's Project Expenses 409,065 Principal Reduction--Long-term Debt 1,733,265 Depreciation (10,325,278) Bond Amortization 60,808 Total Reconciling Items 15,016,648 Change in net position 3,528,971 Net Position--January 1 202,950,792 Net Position--December 31 $ 206,479,763 City of Fort Collins Comprehensive Annual Financial Report 205 WASTEWATER UTILITY ENTERPRISE SEWER REVENUE BONDS SEC RULE 15c2-12 INFORMATION—CUSTOMER BASE, RATE STRUCTURE, AND ENFORCEMENT (UNAUDITED) Customer Base The sewer (wastewater) system serves a customer base which has grown as follows in the years 2008 to 2017: Approximately 94.2% of the wastewater customers are residential, with the remaining 5.8% being industrial and commercial customers. Two customers of the wastewater utility contribute 3% or more of the wastewater utility’s total monthly revenue - a large commercial customer at 4.2% (1,305,236) of total revenue and the university at 4.3% ($1,013.322). Rate Structure User Charges. The following tables show the City’s monthly wastewater user charges in effect on January 1, 2017. Historically, user charges increased 4.5% for residential rates and 7.5% for commercial rates in 1990, 8.6% for residential rates and 11.6% for commercial rates in 1991, 6.0% per year for all customer classes in 1992, 1993, 1994, and 1995, 3.0% in 1996, 0% in 1997, 2.0% in 1998, 1999, 2000, 2001, 2002 and 2003, 5% in 2004, 2005, 2006 and 2007, 12% in 2008, 11% in 2009, 10% in 2010, 9% in 2011, and 8% in 2012. There was no rate increase implemented in 2013. In 2014 Wastewater rates increased 3% in and varied by rate class based on cost of service: +7.5% single family residential, -5.6% duplex, +4.2% multi-family, and -3.6 commercial. Wastewater rates increased 3% in 2015 for all rate classes. In 2016 Wastewater rates increased 3% in and varied by rate class based on cost of service: +2.5% single family residential, duplex, and multi-family, and +4.5% commercial. In 2017 Wastewater rates increased 3% in and varied by rate class based on cost of service: +2.5% single family residential, duplex, and multi-family, and +4.5% commercial. The minimum winter quarter average consumption (WQA) is 3,000 gallons for single family customers (4,000 gallons for duplexes). Large commercial customers who have facility or manufacturing processes that result in a significant difference between the volumes of water delivered and the volume of wastewater discharged had the ability to start metering their flows beginning in 2012. Seven customers qualified for the consumptive credit in 2017, with the credit totaling $196,269. Years Wastewater (at December 31) Customers 2008 32,847 2009 33,134 2010 33,226 2011 33,305 2012 33,398 2013 33,555 2014 34,203 2015 34,425 2016 34,982 2017 35,184 206 City of Fort Collins Comprehensive Annual Financial Report WASTEWATER UTILITY ENTERPRISE SEWER REVENUE BONDS SEC RULE 15c2-12 INFORMATION- RATE STRUCTURE (UNAUDITED) (Continued) Plant Investment Fees. Plant Investment Fees (PIFs) are used to finance growth related capital facility costs for wastewater “backbone” and treatment facilities. They establish equity between existing customers and new customers and shelter existing customers from the cost of growth but must be established and applied in a legal manner (Colorado Senate Bill 15, 2001). This fee is paid at the time a building permit is issued. Proceeds of the plant investment fee are accounted for as contributed capital of the wastewater system, rather than as operating revenue. The City Council adopted the following plant investment fee schedule, which took effect January 1, 2017. Other Fees and Charges. The City also charges additional fees and charges related to the provision of sewer service, including wastewater strength surcharges, industrial wastewater discharge permit application and administration fees, wastewater monitoring and sampling charges, laboratory analysis and support service charges, a private sewage disposal system permit and inspection fee, and a building sewer permit and inspection fee. Residential 2 Fixed Variable Single family $ 17.63 $ 3.426 /kgal of WQA Duplex $ 20.02 $ 3.006 /kgal of WQA Multi-family $ 2.61 per living unit $ 3.319 /kgal of WQA Commercial 3 3/4" metered $ 9.03 $ 3.130 /kgal 1" $ 20.85 $ 3.130 /kgal 1 1/2" $ 41.96 $ 3.130 /kgal 2" $ 71.80 $ 3.130 /kgal 3" $ 114.72 $ 3.130 /kgal 4" $ 181.18 $ 3.130 /kgal 6" $ 794.25 $ 3.130 /kgal 8" $ 917.07 $ 3.130 /kgal Footnotes: 1 2 3 The usage charge of $2.908 multiplied by each increment of 1,000 gallans either (a) metered water or (b) based on WQA, if customer is eligible. Wastewater Rates 2017 Monthly User Charges 1 Excludes payments in lieu of taxes which are included as an additional 6% charge in the wastewater bill and remitted to the general fund. Average monthly amount of water billed during January, February and March. Residential: Single family residence $ 3,500 Duplex and Multi-family residence (per living unit) $ 2,520 Non-Residential: (based on water connection size) 3/4" $ 7,130 1" $ 17,200 1 1/2" $ 33,410 2" $ 59,140 3" ** 4" ** **Calculated on an individual basis, but not less than the 2" charges Plant Investment Fees City of Fort Collins Comprehensive Annual Financial Report 207 WASTEWATER UTILITY ENTERPRISE SEWER REVENUE BONDS SEC RULE 15c2-12 INFORMATION- ENFORCEMENT (UNAUDITED) (Continued) Enforcement The City’s collections of wastewater charges historically have been in excess of 99%. Unpaid charges constitute a perpetual lien on the property to which service was delivered. Customers with delinquent active accounts are sent courtesy notices after 43 days. Wastewater service is not discontinued due to delinquency because of public health regulations. However, the City may discontinue water and electric service on delinquent accounts. Sometimes liens are filed while the delinquent customer is still an active account. Customers who have moved from the address where service was supplied and left the account owing to the City are typically assigned to a collection agency. 208 City of Fort Collins Comprehensive Annual Financial Report WASTEWATER UTILITY ENTERPRISE SEWER REVENUE BONDS SEC RULE 15c2-12 INFORMATION—COLLECTIONS AND OPERATING HISTORY (UNAUDITED) (Continued) Collections (in thousands) The following table sets forth the historical Wastewater System user rates, plant investment fee, other fees and charges, and investment earnings. Operating History of the Wastewater Fund The financial section of this Comprehensive Annual Financial Report contains financial statements of the City and the Wastewater Fund as of and for the year ended December 31, 2016. The following sets forth the operating history of the Wastewater Fund for the years ended December 31, 2013 through 2017. Collections (in thousands) 2013 2014 2015 2016 2017 User rates $ 20,338 $ 21,329 $ 22,064 $ 23,297 $ 23,949 Plant investment fees 3,172 3,674 2,729 4,673 4,411 Other fees and charges 129 404 253 273 172 Investment earnings 172 438 439 133 553 Total Wastewater Revenue $ 23,811 $ 25,846 $ 25,486 $ 28,376 $ 29,085 2013 2014 2015 2016 2017 Operating Revenues Charges for services $ 20,338 $ 21,329 $ 22,064 $ 23,297 $ 23,949 Other revenue 98 783 204 191 160 Total Operating Revenues 20,436 22,113 22,268 23,488 24,109 Operating Expenses Administrative charge 1,724 1,897 2,159 2,679 2,607 Personnel services 4,931 4,852 5,010 5,451 5,612 Contractual services 3,873 3,331 3,026 4,061 3,984 Commodities 1,245 1,186 1,102 1,176 1,302 Other 169 319 1,006 703 866 Depreciation 4,697 5,063 5,474 5,708 5,941 Total Operating Expenses 16,638 16,649 17,776 19,779 20,312 Operating Income 3,798 5,463 4,492 3,708 3,797 Nonoperating Revenues (Expenses) Earnings on investments 172 438 439 133 553 Gain on sale of capital assets 31 33 50 82 12 Interest expense (1,308) (1,217) (1,127) (717) (675) Total Nonoperating Revenues (Expenses) (1,105) (746) (638) (502) (111) Income Before Contributions and Transfers 2,693 4,718 3,854 3,207 3,686 Capital contributed 3,172 3,674 2,729 4,673 4,411 Operating transfers in - - 29 125 - Operating transfers out (10) (36) (38) (72) (211) Income After Contributions and Transfers 3,162 3,638 2,720 4,726 4,200 Change in Net Position 5,855 8,355 6,574 7,933 7,886 Net Position--Jan. 1 143,302 149,158 * 156,029 157,513 ** 170,723 Net Position--Dec. 31 $ 149,157 $ 157,513 $ 162,603 $ 165,446 $ 178,609 Totals may not add due to rounding * Restated 2015 Beginning balance as result of implementing GASB 68. ** Restated 2017 Beginning balance as result of implementing GASB 75. City of Fort Collins Comprehensive Annual Financial Report 209 WASTEWATER UTILITY ENTERPRISE SEWER REVENUE BONDS SEC RULE 15c2-12 INFORMATION—HISTORIC DEBT SERVICE COVERAGE (UNAUDITED) (Continued) The historic debt service coverage on obligations payable from net pledged revenues of the Wastewater Fund for the past ten years is as follows (in thousands): Net Gross Pledged Revenues 2 Expenses 3 Revenues Principal Interest Total Coverage 2008 21,844 10,434 11,410 4,081 1,005 5,087 2.24 2009 22,875 10,577 12,298 4,237 1,817 6,054 2.03 2010 22,170 12,117 10,053 3,378 1,704 5,081 1.98 2011 20,375 11,134 9,240 2,982 1,496 4,477 2.06 2012 23,520 11,658 11,862 3,099 1,459 4,557 2.60 2013 - 11,942 (11,942) 3,265 1,308 4,573 -2.61 2014 26,258 11,586 14,672 1,640 1,217 2,857 5.14 2015 24,360 12,303 12,057 1,695 1,158 2,853 4.23 2016 28,376 14,072 14,305 1,760 328 2,088 6.85 2017 29,085 14,371 14,714 2,123 549 2,672 5.51 1 Includes debt service on all bonds secured by sewer system revenues. 2 Includes all income of the Wastewater Fund pledged for the payment of bonds. 3 Operating expenses less depreciation. Totals may not add due to rounding SEWER REVENUE BONDS--COVERAGE OF DEBT SERVICE REQUIREMENTS BY NET PLEDGED REVENUES OF THE SEWER SYSTEM--2008 TO 2017 1 Debt Service Requirements 210 City of Fort Collins Comprehensive Annual Financial Report WASTEWATER UTILITY ENTERPRISE SEWER REVENUE BONDS SEC RULE 15c2-12 INFORMATION – BALANCES ON DEPOSIT (UNAUDITED) (Continued) The sewer revenue bonds are secured by an irrevocable pledge of a first lien upon net pledged revenues of the Wastewater Fund. The sewer revenue bond ordinances provide that all gross revenues pledged to the sewer revenue bonds will be set aside and credited to the Wastewater Fund and that such revenues will be deposited and applied in the following order of priority: Operation and Maintenance Fund. As a first charge on the Wastewater Fund, the bond ordinances require the City to credit from time to time to the operation and maintenance fund revenue sufficient to pay the necessary and reasonable current expenses of operating, maintaining, and repairing the sewer system. The balance on deposit in this fund as of December 31, 2017 is $3,592,803. In addition to the above, the bond ordinance established the following fund: Sewer Fund. The Sewer Fund, referred to in the bond ordinance, was established by Ordinance No. 67, 1974. Complete financial statements, which reflect all deposits and balances of this fund (herein referred to as the “Wastewater Fund”) are included in the financial section of this report. City of Fort Collins Comprehensive Annual Financial Report 211 STORM DRAINAGE UTILITY ENTERPRISE STORM DRAINAGE REVENUE BONDS SEC RULE 15c2-12 INFORMATION—FEE REVENUES AND OPERATING HISTORY (UNAUDITED) (Continued) Collections (in thousands) The following table sets forth the historical Storm Drainage Fund fee revenues for the years 2013 through 2017. Operating History of the Storm Drainage Fund The financial section of this Comprehensive Annual Financial Report contains financial statement of the City and the Storm Drainage Fund as of and for the year ended December 31, 2017. The following sets forth the operating history of the Storm Drainage for the years ended December 31, 2013 through 2017. 2013 2014 2015 2016 2017 Storm drainage utility fee $ 14,385 $ 14,717 $ 15,035 $ 15,620 $ 16,755 Storm drainage basin fees 842 2,580 1,526 4,530 (2,749) Other Revenues 127 477 342 236 414 Total Storm Drainage Fund Fee Revenues $ 15,354 $ 17,774 $ 16,904 $ 20,387 $ 14,420 2013 2014 2015 2016 2017 Operating Revenues Charges for services $ 14,385 $ 14,717 $ 15,035 $ 15,620 $ 16,755 Other revenue 18 82 47 86 208 Total Operating Revenues 14,403 14,799 15,082 15,707 16,964 Operating Expenses Administrative charge 1,990 2,234 2,276 2,815 2,427 Personnel services 1,908 1,807 1,748 2,401 2,708 Contractual services 2,096 1,239 998 1,081 1,946 Commodities 185 218 316 195 192 Other 331 251 296 278 297 Depreciation 2,134 2,348 2,603 2,633 2,717 Total Operating Expenses 8,644 8,098 8,238 9,404 10,287 Operating Income 5,759 6,701 6,844 6,303 6,677 Nonoperating Revenues (Expenses) Earnings on investments 48 318 295 135 328 Intergovernmental 0 18 1 - - Gain/loss on sale of capital assets 28 27 0 14 (125) Interest expense (1,012) (891) (775) (661) (533) Total Nonoperating Revenues (Expenses) (936) (528) (479) (511) (329) Income Before Contributions and Transfers 4,823 6,173 6,365 5,792 6,347 Capital contributions 842 2,580 1,526 4,530 1,088 Operating transfers In 32 32 - - 3 Operating transfers out (274) (249) (247) (247) (623) Income After Contributions and Transfers 600 2,362 1,279 4,283 468 Change in Net Position 5,423 8,536 7,644 10,075 6,816 Net Position--Jan. 1 96,954 102,377 * 110,471 118,115 128,190 Net Position--December 31 $ 102,377 $ 110,913 $ 118,115 $ 128,190 $ 135,006 Totals may not add due to rounding * Restated 2015 Beginning balance as result of implementing GASB 68. 212 City of Fort Collins Comprehensive Annual Financial Report STORM DRAINAGE UTILITY ENTERPRISE STORM DRAINAGE REVENUE BONDS SEC RULE 15c2-12 INFORMATION – FEE STRUCTURE, PLEDGED REVENUES (UNAUDITED) (Continued) Storm Drainage Utility Fee Structure Storm drainage utility fees are imposed on every developed lot and parcel of land within the City and are payable monthly. The storm drainage utility fee is designed to pay for the operation and maintenance of the City’s storm drainage system. The fee also pays for the design, right-of-way acquisition, and construction or reconstruction of storm drainage facilities throughout the City. The monthly storm drainage utility fee in effect at the end of 2017 for a residential lot of approximately 8,600 square feet is $14.97 and $29.95 for a commercial lot of approximately 8,600 square feet. This storm drainage utility fee did not increase in 2015 or 2016, and increased by 5% in 2017. Storm drainage utility fees are billed through the City’s consolidated monthly billing system, permitting the City to include storm drainage utility fees on a customer’s regular utility bill. If a customer fails to pay any utility fees, the City has the authority to terminate utility service to the delinquent customer and to place a lien on the property for which the fees are delinquent. Approximately 81% of storm drainage utility billing accounts and 44% of storm drainage revenues are attributable to single family residential customers. 19% of accounts and 56% of storm drainage revenues are attributable to multi-family residential, commercial and industrial customers. Two customers of the storm drainage utility contribute 2% or more of the storm drainage utility’s total monthly revenue - the school district with 4.2% ($662,518) of total revenue and the University at 3.9% (601,593). Due to the perpetual lien ordinance, historically, the City collects over 99% of its billed monthly utility charges for storm drainage. Historic Net Pledged Revenues Changes in Storm Drainage Fees Since 1987, the City has increased the overall storm drainage fees sixteen times. The average increase in the total fees is as follows: Prior to November of 1998, storm drainage utility fees varied by basin depending on drainage problems and improvements needed in each basin. Beginning in November of 1988, the fees were assessed uniformly on a city-wide basis and improvements are to be prioritized and constructed based on needs of the City as a whole. Pledged Revenue Coverage Last Ten Fiscal Years in thousands Net Revenue Gross Available for Revenues Expenses Debt Service Principal Interest Total Coverage 2008 15,139 4,865 10,274 2,610 2,483 5,093 2.02 2009 14,219 5,838 8,381 2,568 2,346 4,914 1.71 2010 14,613 5,052 9,560 2,683 1,606 4,289 2.23 2011 14,669 5,299 9,371 2,238 1,143 3,380 2.77 2012 15,729 5,064 10,664 2,965 1,102 4,067 2.62 2013 15,322 6,510 8,812 3,085 954 4,039 2.18 2014 17,742 5,749 11,993 3,203 840 4,042 2.97 2015 16,129 5,635 10,494 3,335 832 4,167 2.52 2016 20,387 6,771 13,616 3,465 699 4,164 3.27 2017 14,420 7,570 6,851 3,595 501 4,096 1.67 STORM DRAINAGE REVENUE BONDS Debt Service Requirements Year Increase Year Increase Year Increase 2003 10% 2008 0% 2013 0% 2004 10% 2009 0% 2014 0% 2005 0% 2010 0% 2015 0% 2006 0% 2011 0% 2016 0% 2007 0% 2012 0% 2017 5% City of Fort Collins Comprehensive Annual Financial Report 213 WATER UTILITY ENTERPRISE WATER REVENUE BONDS SEC RULE 15c2-12 INFORMATION – CUSTOMER BASE AND RATE STRUCTURE (UNAUDITED) Customer Base The water system serves a customer base that has grown as follows in the years 2008-2017: The City classifies its water customers according to several classifications. A breakdown of the accounts based on such classifications being served as of December 31, 2017 is set forth below: The following table sets forth the ten largest customers of the water system, which in the aggregate accounted for approximately 27.7% of total water usage during 2017: Water Rate Structure The City’s water rate structure is administered in substantial compliance with the “cost of service” method endorsed by the American Water Works Association. Under the cost of service method, an effort is made to establish equitable charges which reflect the true costs of serving various classes of customers. Years Water (at December 31) Customers 2008 33,082 2009 32,910 2010 32,983 2011 33,074 2012 33,147 2013 33,348 2014 34,290 2015 34,744 2016 35,085 2017 35,279 Classification Number of Accounts Accounts Residential 32,600 92.4% Commercial & Industrial 2,679 7.6% Total 35,279 100.0% Customer Water Usage Millions of Percent of Total Water Industrial 793,073 11.1% Industrial 394,930 5.5% University 332,234 4.6% City Government 122,645 1.7% School District 98,059 1.4% Industrial 91,354 1.3% Industrial 46,341 0.6% Commercial 40,775 0.6% Hospital 35,613 0.5% Commercial 29,567 0.4% 27.7% 214 City of Fort Collins Comprehensive Annual Financial Report WATER UTILITY ENTERPRISE WATER REVENUE BONDS SEC RULE 15c2-12 INFORMATION – CUSTOMER BASE AND RATE STRUCTURE (UNAUDITED) (Continued) In 2004, City Council directed staff to develop a 4-tier rate that would reduce the severity of cost impacts for larger, single- family, and duplex residential users due to the 2003 5-tier rates. The 4-tier rate structure was adopted by City Council and went into effect May 1, 2004 and remained in effect through April 30, 2006. On March 21, 2006 City Council passed a 3-tier water rate for single family and duplex customers that will be in effect for billings after May 1, 2006 and remain in effect January 1, 2008. A 3% rate increase was implemented for 2009. While a 3% overall revenue increase was implemented for 2010 the resulting cost of service adjustments were +3.8% for residential, 0% for duplex and multi-family and +1.7% for commercial rate classes. A 3% rate increase was implemented for 2011. A 6% across the board rate increase was implemented in 2012 and a 4% across the board rate increase was implemented in 2013 for all rate classes. In January 2014, water rates were increased an average of 4%. The 2014 increase varied by cost of service: +9% single family residential, -1.8% duplex, -16.4 multi-family, 7.7% commercial, and +3.5% high volume industrial. There was no increase in 2015 or 2016. In January 2017, water rates were increased an average of 5% for all rate classes. The following water rates were effective January 1, 2017. In addition to these rates, a 6% payment in lieu of taxes (“PILOT”) is added to all charges and paid to the City’s general fund. Monthly User Charges Effective January 1, 2017 (1) Residential customers with one dwelling unit. a. Base Charges. Residential customers with one dwelling unit shall pay a base monthly charge of $16.18. b. Quantity Charges. Residential customers with one dwelling units shall pay a monthly quantity charge as follows: For the first 7,000 gallons used per month at $2.505 per 1,000 gallons For the next 6,000 gallons used per month at $2.879 per 1,000 gallons For all additional gallons used per month at $3.312 per 1,000 gallons. (2) Residential customers with two dwelling units. a. Base Charges. Residential customers with two dwelling units shall pay a base monthly charge of $17.13. b. Quantity Charges. Residential customers with two dwelling units shall pay a monthly quantity charge as follows: For the next 9,000 gallons used per month at $2.175 per 1,000 gallons For the next 4,000 gallons used per month at $2.499 per 1,000 gallons For all additional gallons used per month at $2.876 per 1,000 gallons. Metered Rates – Nonresidential (1) Base Charges. Nonresidential customers shall pay a base monthly charge based on meter size: (2) Quantity Charges. Nonresidential customers shall pay a monthly quantity charge of $1.992 per 1,000 gallons used in the winter season months of November through April. They shall pay a monthly quantity charge of $2.489 per 1,000 gallons used in the summer season months of May through October. Meter Size (inches) Monthly Base Charge 3/4 $ 14.31 1 $ 39.93 1 1/2 $ 105.58 2 $ 163.64 3 $ 249.59 4 $ 391.83 6 $ 760.11 8 $ 1,342.79 Nonresidential City of Fort Collins Comprehensive Annual Financial Report 215 WATER UTILITY ENTERPRISE WATER REVENUE BONDS SEC RULE 15c2-12 INFORMATION – RATE STRUCTURE AND ENFORCEMENT (UNAUDITED) (Continued) (3) Charges for Excess Use. Monthly water use in excess of the amounts specified in the following table shall be billed at $2.861 per 1,000 gallons used in the winter season months of November through April. Monthly water use in excess of the amounts specified below shall be billed at $3.578 per 1,000 gallons used in the summer season months of May through October. Plant Investment Fees. Plant Investment Fees (PIFs) are used to finance growth related capital facility costs for water “backbone” and treatment facilities. They establish equity between existing customers and new customers and shelter existing customers from the cost of growth but must be established and applied in a legal manner (Colorado Senate Bill 15, 2001). This fee is paid at the time a building permit is issued. Proceeds of the plant investment fee are accounted for as contributed capital of the water system, rather than as operating revenue. The City Council adopted the following plant investment fee schedule, which took effect January 1, 2016. Enforcement The City’s collections of water charges historically have been in excess of 99%. Unpaid water charges constitute a perpetual lien on the property to which service was delivered. Customers with delinquent active accounts are sent delinquency notices after 38 days. The City may discontinue water and electric service on delinquent accounts. Sometimes liens are filed while the delinquent customer is still an active account. Customers who have moved from the address where service was supplied and left the account owing to the City are typically assigned to a collection agency. Meter Size (inches) Specified Amount (gallons per month) 3/4 100,000 1 300,000 1 1/2 625,000 2 1,200,000 3 1,400,000 4 2,500,000 Nonresidential Dwelling Category Plant Investment Fee Single Family $720 plus $0.33 per square foot of lot area 1 Duplex, Multi-Family, Mobile Home $540 per living unit plus $0.24 per square foot of lot area Residential: Water Meter Size (inches) Plant Investment Fee 3/4" $ 7,180 1" $ 19,710 1 1/2" $ 42,220 2" $ 66,680 3" and above Based on peak day demand Non-residential: 216 City of Fort Collins Comprehensive Annual Financial Report WATER UTILITY ENTERPRISE WATER REVENUE BONDS SEC RULE 15c2-12 INFORMATION – CONTRIBUTED CAPITAL AND COLLECTIONS (UNAUDITED) (Continued) Contributed Capital (in thousands) Several significant categories of receipts of the Water Fund which are pledged to the payment of the Bonds are accounted for as contributed capital rather than as revenue. The following table presents, in thousands, receipts of major categories of contributed capital by the Water Fund for the past ten years: Collections (in thousands) The following table sets forth the historical Water System user rates, plant investment fees, other fees and charges, and investment earnings: Year Contributions In Aid of Construction Cash Contributed In Lieu of Water Rights Plant Investment Fees Anheuser- Busch Master Agreement Payments Anheuser- Busch Capacity Payments Total Contributed Capital 2008 50 3,233 1,356 698 30 5,367 2009 13 824 521 725 32 2,116 2010 11 1,006 668 - 35 1,721 2011 16 2,591 969 - 37 3,612 2012 441 1,675 1,293 - 39 3,449 2013 629 3,049 1,791 - 5 5,474 2014 321 3,323 5,832 - - 9,477 2015 275 2,632 3,235 - - 6,141 2016 297 3,504 3,547 - - 7,347 2017 115 7,537 3,185 - - 10,837 2013 2014 2015 2016 2017 User charges for services $ 25,954 $ 26,771 $ 27,705 $ 29,776 $ 30,772 Plant investment fees 5,474 9,477 6,141 7,347 10,838 Other fees & charges 384 418 377 446 484 Investment earnings 164 908 785 343 787 Total Water System Revenue $ 31,976 $ 37,573 $ 35,008 $ 37,911 $ 42,881 City of Fort Collins Comprehensive Annual Financial Report 217 WATER UTILITY ENTERPRISE WATER REVENUE BONDS SEC RULE 15c2-12 INFORMATION – OPERATING HISTORY AND DEBT STRUCTURE OF THE WATER FUND (UNAUDITED) (Continued) Operating History of the Water Fund (in thousands) The financial section of this Comprehensive Annual Financial Report contains financial statements of the City and the Water Fund as of and for the year ended December 31, 2017. The following sets forth the operating history of the Water Fund for the years ended December 31, 2013 through 2017. As of December 31, 2017, the Net Revenue of the Water Fund serviced the following obligations: (in thousands) 2013 2014 2015 2016 2017 Operating Revenues Charges for services $ 25,954 $ 26,771 $ 27,705 $ 29,776 $ 30,772 Other revenue 1,076 338 288 417 389 Total Operating Revenues 27,030 27,109 27,993 30,193 31,161 Operating Expenses Administrative charge 3,209 3,525 2,983 3,666 2,942 Personal services 6,250 6,377 6,819 7,308 7,592 Contractual services 6,251 6,238 6,867 6,287 4,748 Commodities 1,725 1,560 1,675 1,816 1,841 Other 675 930 653 927 1,322 Capital asset impairments - - 1,305 - - Depreciation 5,514 5,816 6,083 6,431 6,955 Total Operating Expense 23,624 24,445 26,385 26,435 25,399 Operating Income 3,406 2,664 1,607 3,758 5,762 Nonoperating Revenues (Expenses) Earnings on investments 164 908 785 343 787 Gain on sale of capital assets 58 85 89 29 95 Interest expense (581) (510) (486) (357) (240) Total Nonoperating Revenues (Expenses) (358) 483 387 14 642 Income Before Contributions and Transfers 3,048 3,146 1,995 3,773 6,404 Capital contributions 5,474 9,477 6,141 7,347 10,838 Operating transfers in (out) (197) (196) 209 (208) (427) Income After Contributions and Transfers 5,277 9,280 6,350 7,139 10,411 Change in Net Position 8,325 12,427 8,345 10,912 16,815 Net Position--Jan. 1 260,333 268,658 * 279,550 287,895 298,806 Net Position--Dec. 31 $ 268,658 $ 281,085 $ 287,895 $ 298,806 $ 315,622 Totals may not add due to rounding * Restated 2015 Beginning balance as result of implementing GASB 68. Originally Outstanding Name of Issue Authorized Principal Water Revenue Bond, Series 1999 $ 4,998 $ 503 Water Subordinate, 2004 2,476 1,211 Water Revenue Refunding Series 2008 9,645 2,020 Total $ 27,245 $ 3,735 Totals may not add due to rounding 218 City of Fort Collins Comprehensive Annual Financial Report FORT COLLINS URBAN RENEWAL AUTHORITY TAX INCREMENT REVENUE REFUNDING BONDS SEC RULE 15c2-12 INFORMATION – ASSESSED VALUATION HISTORY (UNAUDITED) Ad Valorem Property Tax Data The following table sets forth a ten-year history of the total assessed valuation in the Plan Area, the amount of such valuation allocable to the Property Tax Base Amount and the amount allocable to the incremental assessed valuation. Levy Year Collection Year Total Assessed Valuation in Tax Increment Area Valuation Allocable to Base Amount Valuation Allocable to Increment 2008 2009 $ 24,100,310 $ 20,994,374 $ 3,105,936 2009 2010 27,041,580 21,231,611 5,809,969 2010 2011 27,045,790 20,939,619 6,106,171 2011 2012 30,223,310 20,025,954 10,196,356 2012 2013 34,008,140 19,957,399 14,050,741 2013 2014 32,584,550 20,112,768 12,471,782 2014 2015 32,757,840 20,016,051 12,741,789 2015 2016 38,261,030 22,011,398 15,918,112 2016 2017 40,300,349 21,667,359 18,632,990 2017 2018 44,086,170 23,878,464 20,207,706 2015 2016 38,261,030 22,011,398 15,918,112 2016 2017 40,300,349 21,667,359 18,632,990 2017 2018 44,086,170 23,878,464 20,207,706 Source: Larimer County Assessor's Office History of Assessed Valuations in the Plan Area City of Fort Collins Comprehensive Annual Financial Report 219 FORT COLLINS URBAN RENEWAL AUTHORITY TAX INCREMENT REVENUE REFUNDING BONDS SEC RULE 15c2-12 INFORMATION – COLLECTION AND ENFORCEMENT HISTORY (Continued) The following table sets forth the history of the Authority’s ad valorem property tax collections. The following table sets forth the assessed valuation of specific classes of real and personal property within the Authority based upon the Authority’s 2017 certified assessed valuation. As shown below, commercial property accounts for the largest percentage of the Authority’s assessed valuation, and therefore it is anticipated owners of commercial property will pay the largest percentage of ad valorem property taxes levied by the Authority. Levy Year Collection Year Anticipated Tax Increment (1) Current Tax Collections Collection Rate 2008 2009 263,227 263,227 100% 2009 2010 502,669 492,625 98% 2010 2011 547,237 524,486 96% 2011 2012 925,521 918,817 99% 2012 2013 1,309,288 1,284,690 98% 2013 (2) 2014 (2) 1,115,796 (3) 1,115,796 (4) 100% 2014 2015 1,138,877 1,138,877 100% 2015 2016 1,442,005 1,428,674 99% 2016 2017 1,666,784 1,655,585 99% 2017 2018 1,835,225 N/A N/A Source: Larimer County Assessor's Office (3) The County Treasurer's 2% collection fee has been deducted from these amounts. (4) The Larimer County Assessor's Office's current policy regarding collections in the Plan Area is to remit 100% of the property tax increment levied in such Area to the Authority (less the 2% collection fee) regardless of the amount collected. Figures do not include interest, fees and penalties. (2) Beginning with the 2013 Levy Year and 2014 Collection Year and going forward. Property Tax Collections in the Plan Area (1) Increment amounts do not reflect abatements and other adjustments. Class Total Assessed Valuation(1) Residential $ 10,457,655 21.40% Commercial 28,934,428 68.94% Industrial 882,152 2.37% Agricultural 3,222 0.01% Natural Resources 115 0.00% Vacant 3,400,618 6.29% State Assessed 407,980 1.00% TOTAL $ 44,086,170 100.00% (1) Includes real and personal property (2)Assessed Value on Exempt properties are not included in calculation, Source: Larimer County Assessor's Office 2017 Assessed Valuation of Classes of Property in the Plan Area Percent of total Assessed 220 City of Fort Collins Comprehensive Annual Financial Report FORT COLLINS URBAN RENEWAL AUTHORITY TAX INCREMENT REVENUE REFUNDING BONDS SEC RULE 15c2-12 INFORMATION – TAXPAYER BASE (UNAUDITED) (Continued) Based on the most recent information available from Larimer County, the following table represents the ten largest taxpayers within the Authority. A determination of the largest taxpayers can be made only by manually reviewing individual tax records. Therefore, it is possible owners of several small parcels may have an aggregate assessed value in excess of those set forth in the following chart. Furthermore, the taxpayers shown in the chart may own additional parcels within the Authority not included herein. No independent investigation has been made of and consequently there can be no representation as to the financial conditions of the taxpayers listed below or that such taxpayers will continue to maintain their status as major taxpayers in the Authority. Sample Mill Levy Affecting Property Owners Within the Plan Area Individual property owners within the Plan Area are obligated to pay ad valorem property taxes to all taxing jurisdictions in which their property is located. Such levies applied to the property tax increment generate the Pledged Property Tax Revenues. According to the Larimer County Assessor’s Office there are currently seven entities overlapping all or a portion of the Plan Area. As a result, property owners within the Plan Area may be subject to various mill levies depending upon the location of their property. The following table is representative of a sample total 2017 mill levy (for payment in 2018) attributable to taxpayers within the Plan Area and is not intended to portray the mill levied against all properties within the Plan Area. Additional taxing entities may overlap the Plan Area in the future. Taxpayer Name 2017 Assessed Valuation Dillon Companies Inc $ 3,826,666 Ft Collins Borrower LLC 3,711,476 RMI2 Properties LLC 1,465,312 King Soopers 907,042 Jog LLC 898,623 Cole Ab Fort Collins Co LLC 782,391 1415 Blue Spruce LLC 716,503 College Country Club LLC 677,962 Kaufman And Robinson Inc 672,040 North College LLC 626,727 $ 14,284,742 Source: Larimer County Assessor's Office 8.42% 3.32% 2.06% (1) Based on 2017 total assessed valuation of $44,086,170 1.63% 1.54% 1.52% 1.42% 32.40% 2.04% 1.77% Percentage of Total Assessed Valuation(1) 8.68% Largest Taxpayers in the Plan Area - 2017 Taxing Entity 2017 Mill Levy (1) Poudre R-1 School District 52.630 Larimer County 22.092 City 9.797 Health District of Northern Larimer County 2.167 Larimer County Pest Control 0.142 Poudre River Public Library District 3.000 Northern Colorado Water Conservation District 1.000 Source: Larimer County Assessor's Office City of Fort Collins Comprehensive Annual Financial Report 221 FORT COLLINS URBAN RENEWAL AUTHORITY TAX INCREMENT REVENUE REFUNDING BONDS SEC RULE 15c2-12 INFORMATION – OVERLAPPING DEBT (UNAUDITED) (Continued) Estimated Overlapping General Obligation Debt Other taxing entities are authorized to incur general obligation debt within boundaries which overlap or partially overlap the boundaries of the Plan Area. The following table sets forth the estimated overlapping general obligation debt chargeable to property owners within the Plan Area as of the date of this disclosure. Additional taxing entities may overlap with the Authority in the future. 2017 Assessed Entity Valuation(1) Obligation Debt $ 34,261,857 $ 243,466 TOTAL $ 243,466 Sources: Larimer County Assessor's Office; and individual taxing entities Estimated Overlapping General Obligation Debt (in thousands) (2) The percentage of an entity's outstanding debt chargeable to the Authority is calculated by comparing the assessed valuation of the portion overlapping the Authority to the total assessed valuation of the overlapping entity. To the extent the Authority's assessed valuation changes disproportionately with the assessed valuation of an overlapping entity, the percentage of debt for which property owners within the Authority are responsible will also change. (1) Assessed values certified in 2017 are for collection of ad valorem property taxes in 2018. PercentDebt Outstanding General $2,730 $2,730 1.12% Outstanding G.O. Debt Attributable to the Authority(2) Poudre R-1 School District 222 City of Fort Collins Comprehensive Annual Financial Report FORT COLLINS URBAN RENEWAL AUTHORITY TAX INCREMENT REVENUE REFUNDING BONDS SEC RULE 15c2-12 INFORMATION – OUTSTANDING PRINCIPAL AND PLEDGED REVENUE SOURCES (UNAUDITED) (Continued) Urban Renewal Authority Fund – History Revenues, Expenditures, and Changes in Fund Balance General. The Authority’s revenues are provided primarily from the Pledged Property Tax Revenues. The activities of the Authority are recorded in the Urban Renewal Authority Fund, which is included in the City’s audited financial statements. History of Revenues, Expenditures, and Changes in Fund Balance. The following table provides a comparative history of revenues, expenditures and changes in fund balance in the Urban Renewal Authority Fund for fiscal years 2013 through 2017. The information in this table has been derived from the audited financial information presented in the City’s Comprehensive Annual Financial Report (CAFR) for each of those years. 2013 2014 2015 2016 2017 REVENUES Taxes $ 1,284,690 $ 1,220,060 $ 1,501,239 $ 1,903,682 $ 3,622,048 Interest earnings 77,174 114,192 99,439 87,369 24,224 Miscellaneous revenue 233,832 328,301 8,484 4,499 - Total Revenues 1,595,696 1,662,553 1,609,162 1,995,550 3,646,272 EXPENDITURES Sustainability services(1) 4,668,120 1,303,463 257,553 789,592 4,523,331 Debt service Principal - 540,000 550,000 560,000 575,000 Interest 596,493 1,143,267 702,963 747,521 698,319 Total Expenditures 5,264,613 2,986,730 1,510,516 2,097,113 5,796,650 Excess (Deficiency) of Revenues(1) Over (Under) Expenditures (3,668,917) (1,324,177) 98,646 (101,563) (2,150,378) OTHER FINANCING SOURCES (USES) Transfers out - (125,000) - - - Loan Issuance 11,085,000 - - - - Premium on Debt 316,806 - - - - Total Other Financing Sources (Uses) 11,401,806 (125,000) - - - Net change in Fund Balances (Deficit) 7,732,889 (1,449,177) 98,646 (101,563) (2,150,378) Fund Balances (Deficit)-January 1 (9,227,401) (1,494,512) (2,943,689) (2,845,043) (2,946,606) Fund Balances (Deficit)-December 31(1) $ (1,494,512) $ (2,943,689) $ (2,845,043) $ (2,946,606) $ (5,096,984) (1) Excess deficiencies of Revenues Under Expenditures and negative fund balances are reflected because the category "Sustainability Services" includes, among other things, the entire amount of advances payable to the City in each year. The advances are to be repaid by property tax increment revenue to be received through 2029. However, modified accrual accounting standards do not allow the recognition of a taxes receivable assets beyond those due within the year advanced. Year Ended December 31 History of Revenues, Expenditures and Changes in Fund Balances City of Fort Collins Comprehensive Annual Financial Report 223 FORT COLLINS URBAN RENEWAL AUTHORITY TAX INCREMENT REVENUE REFUNDING BONDS SEC RULE 15c2-12 INFORMATION – OUTSTANDING PRINCIPAL AND PLEDGED REVENUE SOURCES (UNAUDITED) (Continued) Outstanding Obligations The following table sets forth the Authority’s outstanding obligations as of December 31, 2017. No additional obligations have been issued by the Authority. According to City officials, the Authority may issue additional debt in the future to finance public improvements in the Plan Area. CITY FINANCIAL INFORMATION AND DEBT STRUCTURE Major Sources of Revenue Property Taxes. The City has the power to levy general (ad valorem) taxes against all taxable property in the City. The right of the City to increase the rate of levy for ad valorem taxes and to collect, retain and spend the revenue derived from such ad valorem taxes may be limited by the State Constitution. Tax levies may be made for general obligation bond principal and interest payments and for the cost of the City’s operations. Under the City Charter, the mill levy is limited to fifteen mills, except for debt service on general obligation bonds. The following table set forth the total assessed value and estimated actual value of property within the City for assessment years 2008 through 2017. Issue Outstanding Principal 2013 URA Revenue Bond $ 8,860,000 City Loan Obligations RMI2 $ 2,035,211 Prospect Station 227,100 Summit/Capstone 4,655,299 Outstanding Revenue Obligations Assessment Total Estimated Year Assessed Value Actual Value (1) 2008 1,758,807,267 13,915,507,484 2009 1,822,241,879 14,345,784,572 2010 1,815,946,000 14,520,314,000 2011 1,792,231,000 14,456,330,000 2012 1,796,031,012 14,531,850,737 2013 1,884,693,625 15,272,734,901 2014 1,934,218,000 15,676,980,000 2015 2,229,600,072 18,146,317,000 2016 2,308,002,168 18,766,287,951 2017 2,581,037,435 23,119,631,947 (1) Actual value is derived form a statutory formula based on manuals and data supplied by the State Property Tax Administrator and differs from market value. Source: Larimer County Assessor's Office (2) Assessed Value and Actual Value on Exempt properties are not included in calculation, 224 City of Fort Collins Comprehensive Annual Financial Report FORT COLLINS URBAN RENEWAL AUTHORITY TAX INCREMENT REVENUE REFUNDING BONDS SEC RULE 15c2-12 INFORMATION – LEVY AND COLLECTION HISTORY (UNAUDITED) (Continued) The following property tax levies and collections have been remitted to the City by the County in the collection years 2008 through 2017. Levy Tax Levy Collection Dollar Amount Dollar Amount Percentage Year (1) (Mills) (2) Year Levied (3) Collected (4) Collected 2008 9.797 2009 16,616,294 16,198,109 97.48 2009 9.797 2010 17,171,540 16,702,488 97.27 2010 9.797 2011 17,113,497 16,696,371 97.56 2011 9.797 2012 16,988,466 16,594,770 97.68 2012 9.797 2013 16,956,775 16,537,511 97.53 2013 9.797 2014 17,812,490 17,304,529 97.15 2014 9.797 2015 18,186,953 17,680,445 97.21 2015 9.797 2016 21,843,126 21,623,883 99.00 2016 9.797 2017 22,611,497 22,520,432 99.60 2017 9.797 2018 25,286,424 10,409,408 41.17 (5) (1) Taxes for the year levied are collected in the following year. (2) One mill generates $1 of property tax revenue per $1,000 of assessed valuation. Source: Larimer County Treasurer's Office Property Tax Levies and Collections (4) The dollar amounts collected in Levy Years 2008-2014 are reduced by the County's 2% collection fees. Accordingly, the maximum possible percentage of property taxes collected in such years was 98% of the property taxes levied. (3) Amounts are net of incremental taxes pledged for the City's tax increment revenue obligations. (5) Collections as of 03/13/2018 City of Fort Collins Comprehensive Annual Financial Report 225 FORT COLLINS URBAN RENEWAL AUTHORITY TAX INCREMENT REVENUE REFUNDING BONDS SEC RULE 15c2-12 INFORMATION – TAXPAYER BASE (UNAUDITED) (Continued) Taxpayer Assessed Valuation (Property in the City) Percentage of Total City Assessed Valuation Avago Technologies Wireless USA Mfg $ 138,020,663 5.98% Anheuser Busch LLC 49,117,245 2.13 Ramco-Gershenson Properties LP 31,691,432 1.37 Walton Foothills Holdings VI LLC 29,222,125 1.27 Woodward Inc 26,540,750 1.15 Anheuser-Busch Commercial 22,910,000 0.99 Qwest Corporation 18,674,400 0.81 Amcap Harmony LLC 15,705,327 0.68 Public Service Company of CO (Xcel) 12,284,235 0.53 Hewlett Packard 11,600,000 0.50 Source: Larimer County Assessor's Office Ten Largest Property Taxpayers of the City 2017 Assessed Valuation for Taxes Due in 2018 (in thousands of dollars) 226 City of Fort Collins Comprehensive Annual Financial Report Governmental Unit Mill Levy City of Fort Collins 9.797 Larimer County 22.092 Larimer County Pest Control 0.142 Poudre School District R-1 52.630 Northern Colorado Water Conservancy District 1.000 Health District of Northern Larimer County 2.167 Poudre River Public Library District 3.000 Governmental Unit Mill Levy Fort Collins General Improvement District No. 1(1) 4.924 Fort Collins-Loveland Water District 1.500 South Fort Collins Sanitation District 0.500 Thompson R2-J School District 36.315 Thompson Valley Health Services District 1.758 Larimer County GID No. 15 Skyview South 10.000 Harmony Technology Park Metro District No. 2 5.000 Foothills Metro District 60.110 5.000 (1) Part of the City's reporting entity Present Tax Levy Applicable to Most Properties Located in the City Fort Collins Downtown Development Authority(1) Source: Larimer County Assessor's Office Portions of the City are subject to additional mill levies due to their location within the following tax districts: For 2017 Taxes Due in 2018 City of Fort Collins Comprehensive Annual Financial Report 227 FORT COLLINS URBAN RENEWAL AUTHORITY TAX INCREMENT REVENUE REFUNDING BONDS SEC RULE 15c2-12 INFORMATION – SALES TAX RATES (UNAUDITED) (Continued) The following table shows the historical breakdown of the total sales tax rate within the City for fiscal years 2008 through 2017. The City’s base 2.25% sales and use tax is comprised of a 1% tax approved by Ordinance No. 58, 1967, a 1% tax approved by Ordinance No. 140, 1979 and 0.25% tax by Ordinance No. 149, 1981. This sales and use base tax has no expiration, no restrictions on how it can be used, and is deposited into the General Fund. Sales and Use Tax Collections - In addition to the sales and use base tax, there are several special sales and use taxes which are restricted to specific purposes and have expiration dates. A street capital maintenance tax of 0.25% is imposed for a renewed period expiring December 31, 2025. A Capital Improvements tax of 0.25% tax is imposed for a renewed period expiring December 31, 2025. Natural Areas and Parks Tax is another 0.25% tax which is imposed through December 31, 2030 and may only be used for preservation and improvement of natural areas and trails and specified capital parks projects. An additional 0.85% of the tax is imposed through December 31, 2020 and referred to as Keep Fort Collins Great. The revenue from such 0.85% tax may only be used for Street Maintenance (33%), Other Transportation Needs (17%), Police Services (17%), Fire Protection (11%), Parks Maintenance and Recreation Services (11%), and Other Community Priorities (11%). The following table shows the sales and use tax revenues collected for such unrestricted and restricted purposes for fiscal years 2008 through 2017. Fiscal Year City Direct Rate(1) Larimer County State of Colorado Total 2008 3.00 0.80 2.90 6.70 2009 3.00 0.80 2.90 6.70 2010 3.00 0.80 2.90 6.70 2011 3.85 0.80 2.90 7.55 2012 3.85 0.80/0.60(2) 2.90 7.55/7.35 2013 3.85 0.6 2.90 7.35 2014 3.85 0.60 2.90 7.35 2015 3.85 0.65 2.90 7.4 2016 3.85 0.65 2.90 7.40 2017 3.85 0.65 2.90 7.40 (1) Food for home consumption sales direct rate is 2.25% (2) Larimer County sales tax rate decreased from 0.8% to 0.6% effective July 1, 2012. Source: City's Finance Department Direct and Overlapping Sales Tax Rates 228 City of Fort Collins Comprehensive Annual Financial Report FORT COLLINS URBAN RENEWAL AUTHORITY TAX INCREMENT REVENUE REFUNDING BONDS SEC RULE 15c2-12 INFORMATION – TAXABLE SALES HISTORY (UNAUDITED) (Continued) 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 Sales Tax Category Grocery, Convenience, Liquor $ 359.8 $ 359.7 $ 363.8 $ 394.1 $ 429.0 $ 458.9 $ 488.3 $ 513.5 $ 530.3 $ 532.4 Restaurants, Caterers and Bars 285.9 285.4 295.6 315.4 337.9 353.1 380.2 408.8 427.7 448.3 General Merchandise 318.3 306.7 299.4 303.0 303.5 313.1 323.2 302.9 300.0 301.3 Building Materials, Garden Equipment & Supplies 138.4 130.2 142.9 154.8 165.9 186.1 221.5 226.4 230.0 241.8 Vehicle Sales, Parts and Repairs 162.9 149.3 160.0 164.5 180.6 193.6 221.4 228.5 227.6 235.3 Miscellaneous Retailers 110.0 103.9 110.4 116.4 121.7 131.0 138.6 146.9 169.8 202.7 Electronics and Appliances 117.7 107.8 111.9 118.2 122.1 126.0 150.7 163.0 156.6 154.4 Sporting, Hobby, Book, Music 126.0 126.1 129.2 134.5 134.9 137.3 140.5 149.2 144.8 137.1 Utilities 103.3 97.5 100.8 107.0 111.2 117.5 122.2 118.1 118.9 124.2 Broadcasting and Telecommunications 113.7 113.0 119.0 116.7 117.2 108.0 111.8 115.2 124.7 121.4 Pharmacy, Salon and Laundry 45.4 45.0 54.5 61.1 54.6 56.8 66.6 84.5 101.2 117.9 Clothing and Accessories 79.4 74.8 76.9 83.0 88.7 82.9 78.4 78.1 103.1 105.3 Other 47.2 43.0 44.3 45.9 51.0 53.7 58.6 63.3 70.3 75.2 Furniture and Home Furnishings 52.3 38.9 41.0 43.7 50.0 56.5 60.7 65.4 68.0 68.2 Rental and Leasing Services 52.1 46.4 43.1 42.7 46.3 44.5 52.0 59.3 66.5 67.6 Manufacturing 37.3 26.7 30.5 37.1 44.5 44.2 52.2 51.4 51.6 64.5 Lodging 33.9 29.1 32.2 35.2 40.2 42.1 49.8 54.9 53.5 56.0 Wholesale Trade 49.2 41.9 35.6 37.5 42.4 43.6 45.2 54.1 57.1 43.4 Total $2,232.8 $2,125.3 $2,191.2 $2,310.9 $2,441.7 $2,548.9 $2,761.9 $2,883.7 $3,001.7 $3,096.8 City direct sales tax rate* 3.00% 3.00% 3.00% 3.00% 3.85% 3.85% 3.85% 3.85% 3.85% 3.85% (1) Food sales city direct sales tax rate is 2.25% Totals may not add due to rounding Source: City's Finance Department Taxable Sales by Category Last Ten Fiscal Years (in millions of dollars) City of Fort Collins Comprehensive Annual Financial Report 229 FORT COLLINS URBAN RENEWAL AUTHORITY TAX INCREMENT REVENUE REFUNDING BONDS SEC RULE 15c2-12 INFORMATION – GENERAL FUND OPERATING HISTORY (UNAUDITED) (Continued) 2013 2014 2015 2016 2017 REVENUES Taxes $ 89,625,619 $ 101,405,160 $ 106,377,268 $ 108,842,908 $ 109,330,572 Licenses and permits 2,776,268 4,366,908 3,635,061 3,740,888 $ 3,809,880 Intergovernmental 10,903,908 11,684,816 12,604,604 12,575,111 14,052,239 Fees and charges for services 8,668,524 9,182,619 9,209,344 10,132,917 9,506,463 Fines and forfeitures 2,803,037 2,536,019 2,774,131 2,151,744 2,033,894 Earnings on investments 113,166 1,334,797 1,007,591 501,851 1,147,269 Miscellaneous revenue 1,490,609 1,319,949 2,014,863 1,796,671 1,424,488 Total Revenues 116,381,131 131,830,268 137,622,862 139,742,090 141,304,805 EXPENDITURES Current operating Police services 31,009,177 31,588,192 32,706,835 34,735,721 36,927,099 Financial services 3,583,699 3,716,210 3,867,954 3,957,133 4,360,932 Community and operation 19,494,541 19,156,348 20,618,636 21,560,882 11,463,307 Planning, development and transportation 4,918,379 6,699,335 6,829,551 7,755,895 8,856,489 Executive, legislative and judicial 5,287,972 5,838,697 6,841,668 6,934,808 6,815,336 Employee and communications 2,708,537 2,812,320 3,541,153 4,651,522 17,298,851 Sustainability services 5,328,328 4,712,753 6,772,316 7,913,103 6,727,816 Other 1,649,314 1,198,085 2,205,191 1,249,843 1,695,009 Intergovernmental Fire protection 17,412,296 17,682,145 19,383,092 20,556,911 24,012,449 Capital outlay 830,728 3,370,494 1,860,349 1,174,048 4,022,277 Debt service Principal 27,725 110,761 235,228 224,223 - Interest 1,903 11,430 21,798 16,534 497 Total Expenditures 92,252,599 96,896,770 104,883,771 110,730,623 122,180,062 Excess (Deficiency) of Revenues Over (Under) Expenditures 24,128,532 34,933,498 32,739,091 29,011,467 19,124,743 OTHER FINANCING SOURCES (USES) Transfers in 2,085,971 3,398,310 619,247 955,314 1,329,931 Transfers out (21,506,120) (25,115,948) (34,192,559) (27,536,157) (27,102,100) Capital leases 158,771 1,321,925 43,800 - - Sale of capital assets - 16,097 118,298 1,249 1,539,481 Impairment of land held for resale - - (1,058,771) - - Total Other Financing Sources (Uses) (19,261,378) (20,379,616) (34,469,985) (26,579,594) (24,232,688) Net Change in Fund Balance 4,867,154 14,553,882 (1,730,894) 2,431,873 (5,107,945) Fund Balances-January 1 55,252,765 60,119,919 74,673,801 72,942,907 Fund Balance-December 31 $60,119,919 $74,673,801 $72,942,907 $75,374,780 69,853,891 Sources: City's Comprehensive Annual Financial Reports. 74,961,836 (1) (1) Restated 2017 Beginning balance as result of implementing GASB 75. City of Fort Collins General Fund Comparative Statement of Revenues and Other Sources, Expenditures and Other Uses and Fund Balance For the Years Ended December 31 230 City of Fort Collins Comprehensive Annual Financial Report Financial Planning 02/01 The public report burden for this information collection is estimated to average 380 hours annually. Form # 350-050-36 City or County: Fort Collins YEAR ENDING : December 2017 This Information From The Records Of (example - City of _ or County of _): Prepared By: Accounting Phone: 970-416-2436 A. Local B. Local C. Receipts from D. Receipts from Motor-Fuel Motor-Vehicle State Highway- Federal Highway Taxes Taxes User Taxes Administration 1. Total receipts available 2. Minus amount used for collection expenses 3. Minus amount used for nonhighway purposes 4. Minus amount used for mass transit 5. Remainder used for highway purposes AMOUNT AMOUNT A. Receipts from local sources: A. Local highway disbursements: 1. Local highway-user taxes 1. Capital outlay (from page 2) 625,017 a. Motor Fuel (from Item I.A.5.) 2. Maintenance: 30,740,966 b. Motor Vehicle (from Item I.B.5.) 3. Road and street services: c. Total (a.+b.) a. Traffic control operations 4,895,773 2. General fund appropriations 3,551,090 b. Snow and ice removal 2,110,851 3. Other local imposts (from page 2) 27,113,171 c. Other 2,489,514 4. Miscellaneous local receipts (from page 2) 6,771,257 d. Total (a. through c.) 9,496,138 5. Transfers from toll facilities 4. General administration & miscellaneous 1,262,253 6. Proceeds of sale of bonds and notes: 5. Highway law enforcement and safety 754,725 a. Bonds - Original Issues 6. Total (1 through 5) 42,879,099 b. Bonds - Refunding Issues B. Debt service on local obligations: c. Notes 1. Bonds: d. Total (a. + b. + c.) a. Interest 7. Total (1 through 6) 37,435,518 b. Redemption B. Private Contributions c. Total (a. + b.) C. Receipts from State government 2. Notes: (from page 2) 5,443,581 a. Interest D. Receipts from Federal Government b. Redemption (from page 2) - c. Total (a. + b.) E. Total receipts (A.7 + B + C + D) 42,879,099 3. Total (1.c + 2.c) C. Payments to State for highways D. Payments to toll facilities E. Total disbursements (A.6 + B.3 + C + D) 42,879,099 Opening Debt Amount Issued Redemptions Closing Debt A. Bonds (Total) 1. Bonds (Refunding Portion) B. Notes (Total) A. Beginning Balance B. Total Receipts C. Total Disbursements D. Ending Balance E. Reconciliation 42,879,099 42,879,099 - Notes and Comments: FORM FHWA-536 (Rev. 1-05) PREVIOUS EDITIONS OBSOLETE (Next Page) ITEM V. LOCAL ROAD AND STREET FUND BALANCE ITEM IV. LOCAL HIGHWAY DEBT STATUS (Show all entries at par) AND STREET PURPOSES LOCAL HIGHWAY FINANCE REPORT I. DISPOSITION OF HIGHWAY-USER REVENUES AVAILABLE FOR LOCAL GOVERNMENT EXPENDITURE ITEM II. RECEIPTS FOR ROAD AND STREET PURPOSES III. DISBURSEMENTS FOR ROAD City of Fort Collins Comprehensive Annual Financial Report 231 STATE: Colorado YEAR ENDING (mm/yy): December 2017 AMOUNT AMOUNT A.3. Other local imposts: A.4. Miscellaneous local receipts: a. Property Taxes and Assessments a. Interest on investments 871,067 b. Other local imposts: b. Traffic Fines & Penalties 1. Sales Taxes 18,475,983 c. Parking Garage Fees 2. Infrastructure & Impact Fees 5,086,230 d. Parking Meter Fees 3. Liens e. Sale of Surplus Property 231,910 4. Licenses 312,127 f. Charges for Services 5,253,947 5. Specific Ownership &/or Other 3,238,831 g. Other Misc. Receipts 151,333 6. Total (1. through 5.) 27,113,171 h. Other 263,000 c. Total (a. + b.) 27,113,171 i. Total (a. through h.) 6,771,257 (Carry forward to page 1) (Carry forward to page 1) AMOUNT AMOUNT C. Receipts from State Government D. Receipts from Federal Government 1. Highway-user taxes 4,683,918 1. FHWA (from Item I.D.5.) 2. State general funds 2. Other Federal agencies: 3. Other State funds: a. Forest Service a. State bond proceeds b. FEMA b. Project Match c. HUD c. Motor Vehicle Registrations 484,315 d. Federal Transit Admin d. Other (Specify) - DOLA Grant e. U.S. Corps of Engineers e. Other (Specify) 275,348 f. Other Federal f. Total (a. through e.) 759,663 g. Total (a. through f.) 4. Total (1. + 2. + 3.f) 5,443,581 3. Total (1. + 2.g) (Carry forward to page 1) ON NATIONAL OFF NATIONAL HIGHWAY HIGHWAY TOTAL SYSTEM SYSTEM (a) (b) (c) A.1. Capital outlay: a. Right-Of-Way Costs 625,017 625,017 b. Engineering Costs 0 c. Construction: (1). New Facilities 0 (2). Capacity Improvements 0 (3). System Preservation 0 (4). System Enhancement & Operation 0 (5). Total Construction (1) + (2) + (3) + (4) 0 d. Total Capital Outlay (Lines 1.a. + 1.b. + 1.c.5) 625,017 625,017 (Carry forward to page 1) Notes and Comments: FORM FHWA-536 (Rev.1-05) PREVIOUS EDITIONS OBSOLETE 2 III. DISBURSEMENTS FOR ROAD AND STREET PURPOSES - DETAIL II. RECEIPTS FOR ROAD AND STREET PURPOSES - DETAIL LOCAL HIGHWAY FINANCE REPORT ITEM ITEM ITEM ITEM 232 City of Fort Collins Comprehensive Annual Financial Report THIS PAGE INTENTIONALLY LEFT BLANK (1) One mill equals one tenth of one cent. Mill levies certified in 2017 are for the collection of ad valorem property taxes in 2018. Sample Total 2017 Mill Levy Valuation $ 201,087,112 (1) Net Assets -- January 1, 2015 beginning balance was adjusted, due to the adoption of GASB Statement No. 68 "Accounting and Financial Reporting for Pensions" resulted in a restatement to recognize the liability expected to be liquidated with expendable available financial resources. Other miscellaneous 1,839 1,792 1,379 1,498 1,613 808 2,003 1,984 890 888 Transfers (11,820) (10,947) (13,636) (13,486) (15,837) (6,383) (1,959) (1,532) (2,236) (3,505) Total business-type activities (398) (4,428) (9,671) (9,069) (11,996) (5,109) 2,374 2,565 (456) (172) Total primary government 141,161 111,533 112,724 136,985 149,257 158,920 184,055 196,129 191,223 201,834 Change in net position Governmental activities 22,902 7,181 14,034 32,934 55,001 60,104 52,734 46,333 36,666 43,390 Business-type activities 24,648 13,088 17,833 21,496 30,045 28,908 36,887 22,467 30,441 33,555 Total primary government $ 47,549 $ 20,270 $ 31,867 $ 54,429 $ 85,047 $ 89,012 $ 89,621 $ 68,800 $ 67,108 $ 76,945 Totals may not add due to rounding Restricted Assets - cash and cash equivalents 1,600,860 - - $ 2,285,749 $ 3,727,556 $ 695,753 Total Assigned 17,909,053 - - - 24,315,991 42,225,044 Unassigned 33,919,316 - - (6,065,911) (154,968) 27,698,437 Total Fund Balances (Deficit) $ 70,739,917 $ 12,731,259 $ 17,620,857 $ (5,096,984) $ 111,637,477 $ 207,632,525 statement of net position: Cash and cash equivalents 4,127,484 9,282,485 6,158,589 3,114,448 Restricted Assets - cash and cash equivalents - - 6,542 - $ 4,127,484 $ 9,282,485 $ 6,165,131 $ 3,114,448 The notes to the financial statements are an integral part of this statement.