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Home My WebLink AboutMemo - Read Before Packet - 9/1/2020 - Memorandum From Blaine Dunn And Kelley Vodden Re: 2019 Peoples Financial Report Financial Services 215 N Mason Street, 2nd Floor PO Box 580 Fort Collins, CO 80522 970.221.6770 970.221.6782 - fax fcgov.com/finance MEMORANDUM DATE: August 28, 2020 TO: Mayor and Councilmembers THRU: Darin Atteberry, City Manager Travis Storin, Interim CFO FROM: Blaine Dunn, Interim Accounting Director Kelley Vodden, Controller RE: 2019 People’s Financial Report CC: ELT Members Attached is a copy of the recently published People’s Annual Financial Report. This Government Finance Officers Association (GFOA) sanctioned report is designed for ease of explanation with the community, specifically for those without a background in public finance per se. The report is submitted for independent evaluation by GFOA under its Popular Financial Reporting Award program, for which the City has been awarded 4 years in a row. A copy of the report can be found online at: https://www.fcgov.com/finance/files/pafr-2019.pdf If you desire to receive copies for a listening session or for distribution to a specific entity or individual, please contact Carolyn Koontz at ckoontz@fcgov.com. DocuSign Envelope ID: D8D59C0F-318A-4744-BB83-0320C204FC73 COLLABORATION FOR COMMUNITY PEOPLE’S ANNUAL FINANCIAL REPORT 2019 FORT COLLINS, COLORADO FISCAL YEAR ENDING DECEMBER 31, 2019 CONTENTS Letter from the City Manager & CFO .....................1 Meet Fort Collins ........................................................2 About the City Government Organization ..........3 Customer-Focused Service ....................................4 2019 Snapshot: Service in Action ..........................6 Fort Collins by the Numbers ...................................7 Fort Collins Financial Results ...........................10-11 Revenues .....................................................................12 Expenses .....................................................................13 Treasury Administration ..........................................15 Capital Assets ...........................................................16 Glossary ......................................................................17 The purpose of this report is to provide an overview of the financial position and operations of the City of Fort Collins, as reported in the City’s Comprehensive Annual Financial Report (CAFR), along with other information of interest. The financial information presented is unaudited and in a summarized and condensed form, and does not substitute for the City’s CAFR. The City’s CAFR is prepared in conformity with generally accepted accounting principles (GAAP). Included in the CAFR is the Independent Auditor’s Report by BKD, LLP on the general purpose financial statements of the City. This report summarizes more than 200 pages of the CAFR’s financial and statistical data. The financial statements condense information of all funds included in the “Total Primary Government.” GAAP requires certain financial presentation and disclosures, which are omitted in this report. As a result, the Balance Sheet and Income Statement presented here are not in strict conformity with GAAP. The City’s CAFR has received awards for outstanding financial reporting from the Government Finance Officers Association. The CAFR and the City Manager’s Budget are available on the City’s website, fcgov.com/finance. ABOUT THIS REPORT Darin Atteberry City Manager Travis Storin Interim Chief Financial Officer Fort Collins Residents, One of the primary roles of government is to use taxpayer dollars to provide the high-quality programs and services the community expects and deserves, and to do so in a thoughtful, transparent manner. This includes providing regular reports on the City’s finances. It is thus our privilege to present to you the City of Fort Collins 2019 People’s Annual Financial Report for the fiscal year. This report is one part of the City's collective focus on accountability, transparency and responsiveness to the community, and we hope this report helps you to learn about and participate in the City’s financial activities in an easy-to-understand, concise manner. This report includes condensed and simplified information from the 2019 Comprehensive Annual Financial Report (CAFR). It is important to note that this report is unaudited and is presented on a non- Generally Accepted Accounting Principles (GAAP) basis. It contains condensed financial information and does not provide all of the necessary financial statements and note disclosures required by GAAP This document includes information on the Fort Collins Urban Renewal Authority, a legally separate, blended component unit of the City, which is therefore included in the City’s governmental activity figures. It excludes discrete component units and fiduciary fund information. The CAFR is a more detailed and complete financial presentation, which is prepared in conformity with GAAP and is audited by the City’s independent auditors. The work of building community is a high value and it is a commitment that the nearly 2,500 City employees take seriously. We also firmly believe that the best innovation, progress and solutions to both challenges and opportunities take place when there are more voices at the table. The City of Fort Collins is fortunate to have many community partners—the school district, area colleges and universities, our vibrant businesses, non-profits, healthcare systems, faith communities and many more—who are equally committed to co-creating the Fort Collins we strive toward. In times of uncertainty, those partnerships and community- developed solutions are even more valuable. The data in this report reflects the City’s 2019 financial position; however, it is being produced in 2020 as the City, the nation and the world are still in the midst of the COVID-19 pandemic and the associated economic impacts. While the full extent of this current crisis is still unknown, as you will see in this document the City of Fort Collins entered 2020 from a strong financial state, which has and will continue to help us weather this storm. We would like to thank the staff of the Accounting and Treasury department for producing this report and the CAFR. Their commitment to accountability and integrity provides a great service to the Fort Collins community. We also invite you to seek more in-depth information online. The CAFR, Biennial Budget, and other detailed reporting are available online at fcgov.com/finance. CITY OF FORT COLLINS 1 LETTER FROM THE CITY MANAGER & CFO 2 PEOPLE’S ANNUAL FINANCIAL REPORT 2019 Fort Collins is recognized by various national organizations and magazines as one of the best places to live in the nation. Incorporated in 1873 and located in Northern Colorado, Fort Collins is home to Colorado State University (CSU) and an outstanding public school system, several large high-tech employers and leading businesses in the craft brewing industry. The community offers exciting recreational opportunities, unique cultural offerings and amenities, and is a regional center for employment and commerce. As with many cities that house a large university, the economy and culture of Fort Collins are closely tied with CSU. Both the university and the city have grown considerably in population in recent history. With 8,400 employees, CSU was the largest employer in Fort Collins in 2019. Despite the vibrancy and general economic stability the community enjoys, the City has several challenges to navigate in coming years. The community has set ambitious climate action goals that will require thoughtful planning in order to achieve while still maintaining economic vitality and social health. Housing affordability and availability is a top priority for the community and City leadership, as is continuing efforts around equity and inclusion, so that all community members feel safe, welcome and valued in Fort Collins. Finally, the longer-term economic impacts from COVID-19 are still unknown and will present challenges for both the municipal organization and the broader local economy. QUICK FACTS • Estimated Population: 174,871 City of Fort Collins, January 2020 • Unemployment Rate: 2.0%% Bureau of Labor Statistics Occupational Employment and Wage Estimates, December 2019 • Median Age: 29.1 American Community Survey 5-Year Estimates, 2014-2018 • Median Household Income: $62,132 American Community Survey 5-Year Estimates, 2014-2018 • Education Level (approximate percentage of population with completion of 4 or more years of college education): 54.5% American Community Survey 5-Year Estimates, 2014-2018 MEET FORT COLLINS TOP TEN EMPLOYERS BY HEADCOUNT Colorado State University 8,400 Educational Services Poudre Valley Hospital 5,400 Health Care & Social Assistance Poudre R-1 School District 4,500 Educational Services City of Fort Collins 2,100 Public Administration Larimer County 2,000 Public Administration Woodward Inc 1,400 Manufacturing Broadcom (Avago Technologies)1,200 Manufacturing Dillon Companies (multiple King Soopers locations)910 Grocery Otter Products 880 Manufacturing Department of Agriculture 750 Public Administration CITY OF FORT COLLINS 3 CITY LEADERSHIP Fort Collins is a home rule city with a Council/ Manager form of government. The Council is made up of six district Councilmembers who are elected on a non-partisan basis for a four-year term and a Mayor who is elected at-large on a non-partisan basis for a two- year term. The Council appoints the City Manager, the City Attorney and the Chief Municipal Judge, who in turn manage the professional municipal organization. CITY SERVICES The Fort Collins municipal organization provides a full range of services, including: • Police • Fire Protection through a local Authority • Five utilities: Light & Power, Water, Wastewater, Stormwater, and Broadband • Streets, Transportation, and Transit infrastructure • Parks, Recreation, Natural Areas, and Cultural facilities • Planning, Engineering, and Community services • Sustainability services, including Economic Health, Environmental Services, and Social Sustainability A full department directory can be found at fcgov.com/cityservices. KEY OUTCOME AREAS The City’s entire strategic planning, budgeting, execution, and performance measurement revolves around seven outcome areas. Our strategic plan is located at fcgov.com/strategicplan; the City budget can be reviewed at fcgov.com/budget. Neighborhood Livability & Social Health Culture & Recreation Economic Health Environmental Health Safe Community Transportation & Mobility High Performing Government VISION, MISSION & VALUES Vision: To provide world-class municipal services through operational excellence and a culture of innovation. Mission: Exceptional service for an exceptional community. Values: • Collaboration • Excellence • Integrity • Outstanding Service • Safety & Well-being • Stewardship ABOUT THE CITY GOVERNMENT ORGANIZATION VISION MISSION VALUES 4 PEOPLE’S ANNUAL FINANCIAL REPORT 2019 CUSTOMER-FOCUSED SERVICE INTERACTING WITH THE CITY People have more avenues than ever to keep up to speed on initiatives, news, programs, or requests for City services: Access Fort Collins - An easy way to reach the City with questions, comments, or service requests. fcgov.com/accessfortcollins FCTV - Regularly updated video content, available on basic cable and streaming online, which provides several programming options designed to inform, educate, and inspire. fcgov.com/fctv Social Media - People can also stay current and provide feedback via social media platforms such as Facebook, Twitter, or Instagram. fcgov.com OpenCity - Designed to take transparency to the next level. The goal of OpenCity is to create a web portal to host data sets, including expense records, that are available to the public in a format that people can easily search, filter, or use in innovative and creative ways. fcgov.com/opencity Our City - This is your chance to get involved in the City’s biggest projects! Engagement and feedback opportunities on this site mirror what is happening on the ground so everyone can join. ourcity.fcgov.com THERE’S AN APP FOR THAT To stay just one tap away from the City, consider downloading these handy applications to your smart phone. • Access Fort Collins • Ride Transfort • FC Parking CITY OF FORT COLLINS 5 DATA-INFORMED DECISION MAKING The City of Fort Collins has deliberately moved from a “trust us” model to being a data- informed organization. We are using data to improve efficiency and accountability. Community Dashboard – An online tool that measures the community’s progress in attaining the City’s Key Outcome Areas. Important metrics such as voluntary code compliance, unemployment rate, community energy use, number of local traffic crashes and transit ridership 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. Climate Dashboard – A snapshot of the community’s progress toward reducing carbon emissions. The City tracks emissions annually using 2005 as a baseline year. The community aims to reduce carbon 20 percent below 2005 levels by 2020 and 80 percent by 2030 with the goal of being carbon neutral by 2050. View the Climate Dashboard at ftcollinscap.clearpointstrategy.com. Financial Reporting – A wide collection of financial and performance reporting is maintained by the Finance department, including quarterly budget variance reporting, seven-year comparative statements, monthly sales tax reporting, and more. Access these reports at fcgov.com/finance. Community Survey – A statistically valid survey is conducted every two years to poll the public on their perceptions and satisfaction with local government. The information gained from this survey is an important step in the Strategic Plan and the Budgeting for Outcomes processes. Learn more at fcgov.com/communitysurvey. Malcolm Baldrige National Quality Award In 2017, U.S. Commerce Secretary Wilbur Ross named the City of Fort Collins a recipient 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, multi- year pursuit for the City of Fort Collins, 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 achieving the highest level from RMPEx in 2014, the City began applying to the national Baldrige program in 2015. Additional information on the Baldrige Performance Excellence Program is located at nist.gov/baldrige. 6 PEOPLE’S ANNUAL FINANCIAL REPORT 2019 2019-2020 Snapshot COLLABORATION FOR COMMUNITY CONNEXION BROADBAND Fort Collins Connexion was born from an idea – to bring fast, affordable and reliable broadband service to the entire community! After voters approved a Utility Charter amendment to add telecommunications services, the City began building out municipal broadband service. Construction began in February 2019 and by August, the first residential customers were accessing the internet in their homes through Connexion. POUDRE RIVER WHITEWATER PARK Many years of visioning, collaboration, creativity and hard work were showcased with the grand opening of the Poudre River Whitewater Park in the fall of 2019. Thanks to a comprehensive blueprint and vision for the river established in the 2014 Poudre River Downtown Master Plan, the whitewater park project accomplished multiple goals including: providing a purposeful and accessible place to recreate on the river, improving the safety and health of the river through floodplain adjustments, and returning the area to a more natural state through habitat and river restoration enhancements. CITY GIVE City Give is an umbrella for the many existing and future fundraising activities across departments and projects within the City of Fort Collins. It is a pioneering operational initiative created to orchestrate and strengthen the City’s philanthropic practices, standards and partnerships. City Give is an investment in new pathways for successful public-private collaboration. GARDENS EXPANSION For well over a decade, the Gardens on Spring Creek has cultivated a world-class botanic garden with roots in education, experience, sustainability and community-building. Now, with more than 89,000 annual visitors, the Gardens on Spring Creek is one of the largest cultural venues in Northern Colorado. Following a two-year, $6 million expansion project, the Gardens on Spring Creek re-opened its doors to the community in November 2019. The cultural facility now showcases 12 acres of beautifully curated display gardens with more than 1,700 plant varieties. In addition, The Gardens offers a permanent Butterfly House, home to more than 300 fluttering North American butterflies. SUSTAINABLE NEIGHBORHOODS The Sustainable Neighborhoods program kicked off in 2019 as a collaborative effort between the City’s Neighborhood Services and Environmental Services offices and is modeled on similar programs in Lakewood and Denver. The goal of the program is to empower residents to make meaningful progress toward climate goals by hosting workshops and completing projects that advance sustainability in their own neighborhoods, inspiring others to also begin making change. CITY OF FORT COLLINS 7 1,532.25 1,633.65 2018 2019 +101.4** FORT COLLINS BY THE NUMBERS OPERATING STATISTICS Net Operating Budget $460.3M STAFFING BUDGETED FULL-TIME EQUIVALENTS* *Does not include seasonal staff ** This increase includes 77.75 FTE that were converted from full-time hourly to classified or contractual NET 2019 OPERATING & CAPITAL BUDGET $495.7M (AS AMENDED) Net Capital Budget $35.4M PUBLIC SAFETY CULTURE, PARKS, RECREATION & NATURAL AREAS 1.3 M Recreation Facility Attendance & Program Participation 966 Parks Acreage 44 Trail Miles 305,053 Cultural Attendance (Museum, Lincoln Center, Gardens) TRANSPORTATION 4.5M Transfort & Dial-a-Ride Passengers 1,974 Street Lane Miles 235 Traffic Signals UTILITIES SUSTAINABILITY $3.8 M Awarded to Human Services & Affordable Housing Agencies 133 Homes Assessed for Indoor Air Quality 110,548 Police Incidents 20,444 Medical Calls 21,939 Fire Calls 45,350 Natural Areas Acreage 204 Bike Lane Centerlane Miles 240 Affordable Housing Units Under Construction CO2 14%% Reduction in Greenhouse Gases (against 2005 levels,) 546 Miles of Water Mains 959.9 Miles of High Voltage Circuits 118,500 Customer Calls Processed 99.99% Electric System Reliability 8 PEOPLE’S ANNUAL FINANCIAL REPORT 2019 The best innovation, progress and solutions to both challenges and opportunities take place when there are more voices at the table. The City of Fort Collins is fortunate to have many community partners who are equally committed to co-creating the Fort Collins we strive toward.” — Darin Atteberry Fort Collins City Manager CITY OF FORT COLLINS 9 10 PEOPLE’S ANNUAL FINANCIAL REPORT 2019 Fort Collins Financial Results NET POSITION The net position, or net worth, of the City at December 31, 2019 was $2.0 billion. Of the net position balance, $343.0 million is unrestricted and is available to meet ongoing obligations in accordance with the City’s fund designations and fiscal policies. The City’s net position increased by $47.1 million (2.4%). The governmental net position increased by $29.3 million (2.6%) and the business-type position increased by $17.8 million (2.0%). The City’s total long-term liabilities increased by $9.8 million (4.0%) during the current year. Within that activity, the City’s governmental long-term liabilities increased by $20.8 million and business-type long-term liabilities decreased by $11.0 million. NET POSITION (at December 31 in thousands) Governmental Business-type Total Primary Government 2018 2019 2018 2019 2018 2019 ASSETS Current and other assets $ 319,266 $ 352,755 $ 317,642 $ 312,087 $ 636,907 $ 664,949 Capital assets 897,181 920,760 741,489 765,832 1,638,670 1,686,592 Total assets 1,216,447 1,273,515 1,059,131 1,077,919 2,275,577 2,351,541 Deferred outflows of resources 2,187 790 2,617 1,188 4,804 1,978 LIABILITIES Long-term liabilities 59,069 79,823 185,614 174,635 244,683 254,459 Other liabilities 30,016 29,343 24,788 33,695 54,804 63,145 Total liabilities 89,085 109,166 210,402 208,330 299,487 317,604 Deferred inflows of resources 30,046 36,332 -1,641 30,046 37,973 NET POSITION Net investment in capital assets 857,873 855,974 710,492 717,336 1,568,365 1,573,311 Restricted 76,746 81,632 --76,746 81,632 Unrestricted 164,885 191,201 140,854 151,799 305,739 343,000 TOTAL NET POSITION $ 1,099,504 $ 1,128,808 $ 851,346 $ 869,135 $ 1,950,849 $ 1,997,943 CITY OF FORT COLLINS 11 Fort Collins Financial Results SUMMARY OF ACTIVITIES Governmental program revenues increased slightly by $2.2 million while expenses increased $2.9 million. This 3.2 percent increase was driven by a combination of increased transportation and cultural services program revenue. On the business-type side, program revenues experienced a net decrease of $7.4 million. This 3.4 percent decrease was driven in part due to weather impacts coupled with water conservation efforts. Expenses are described in greater detail in the following pages. CONDENSED SUMMARY OF ACTIVITIES (at December 31 in thousands) Governmental Business-type Total Primary Government 2018 2019 2018 2019 2018 2019 REVENUES Program revenues, primarily service charges $ 66,194 $ 68,399 $ 227,340 $ 219,960 $ 293,534 $ 288,359 Sales & use taxes 138,560 143,145 - - 138,560 143,145 Other general revenues 76,457 75,418 9,818 11,733 86,275 87,151 TOTAL REVENUES 281,211 286,962 237,158 231,694 518,369 518,655 Expenses 257,609 260,539 211,144 211,023 468,754 471,561 Transfers 3,274 2,881 ( 3,274 )( 2,881)- - CHANGE IN NET POSITION 26,840 29,304 22,740 17,790 49,615 47,094 Net position, beginning of year 1,072,629 1,099,504 828,605 851,346 1,901,234 1,950,849 NET POSITION, END OF YEAR $ 1,099,468 $ 1,128,808 $ 851,346 $ 869,135 $ 1,950,849 $ 1,997,943 12 PEOPLE’S ANNUAL FINANCIAL REPORT 2019 SALES & USE TAX Many City services are funded through service charges, such as our Utility or Recreation services. However, the City assesses a 3.85 percent tax upon sales, purchases, and certain services in order to fund other services that are not charged based on volume or usage. Base Rate 2.25%. Funds government services like police, transportation, and administration. Streets and Transportation 0.25%, EXPIRES DECEMBER 31, 2025 Streets maintenance taxes were first approved in 1984 and were renewed in 1989, 1998, 2006, and 2016. The Street Maintenance Program focuses on extending the lifespan of roadways and minimizing the cost of maintaining a viable road surface. Good roads cost less to maintain than those in poor condition, and this tax allows the City to maintain the current level of service. Community Capital Improvement Program (CCIP) 0.25%, RENEWED APRIL 2015 AND EXPIRES DECEMBER 31, 2025 IS DEDICATED TO COMMUNITY IMPROVEMENTS CCIP taxes were initiated in 1985 and were renewed in 1990, 1998, 2006, and 2016. Project highlights using this funding for 2016-2025 include City Park train and Club Tico renovations, Downtown Poudre River Park, a Visitor's Center at the Gardens on Spring Creek, Willow and Linden Street improvements, Lincoln Avenue bridge, and a Southeast Community Center. Natural Areas 0.25%, EXPIRES DECEMBER 31, 2030 Open Space Yes!, originally passed in 1992 and renewed in 1998 and 2006, is a key component in the conservation and management of natural areas and trails. Expenditures from this tax include land acquisition, resource and land management, public improvements, and educational programming. Keep Fort Collins Great 0.85%, EXPIRES DECEMBER 31, 2020 This tax was passed by Fort Collins voters in November 2010 to fund services and programs that the community values. The tax is used for road improvement projects, increased staffing and facilities for emergency responders, parks maintenance, and other priorities. In April 2019, Fort Collins voters approved a reconfiguration of this tax. Beginning in 2021, instead of a .85% renewable tax, Fort Collins will permanently add .60% to the ongoing Base Rate and add a renewable .25% tax through 2030. REVENUES HOW IS FUNDING RAISED? BASE TAX RATE 2.25% KEEP FORT COLLINS GREAT .85% STREETS AND TRANSPORTATION .25% COMMUNITY CAPITAL IMPROVEMENT PROGRAM .25% NATURAL AREAS .25% $88.6 M $28.9 M $8.5 M $8.5 M $8.5 M SALES & USE TAX Dollar amounts in millions and reflect 2019 revenue CITY OF FORT COLLINS 13 EXPENSES WHERE DOES THE MONEY GO? Every two years, the City Manager submits a budget for City Council’s adoption. The proposed budget cannot include expenditures that exceed estimated reserve balances and anticipated income. The budget represents six months of input from community members, City staff and City management, and serves as the two-year blueprint for advancing results in the seven key outcome areas. Fort Collins uses Budgeting for Outcomes (BFO) for its budget. The process focuses on results and priorities, not on cost. The process shifts from paying for costs to buying results. Service providers, or “sellers," make offers to results teams aligned behind one of the seven outcomes. Teams evaluate effectively purchasing these offers from the seller based on their priority. These purchase decisions put community members and their priorities first. For more information, please visit fcgov.com/bfo. In 2019, governmental expenditures totaled $260.5 million, an increase of $2.9 million, or 1.1 percent, when compared to 2018. Public safety expenses increased $3.9 million largely due to additional compensation resulting from the police collective bargaining agreement. Transportation and Interest on long-term debt increased $1.1 million and $1.0 million respectively while Culture, Parks, Recreation and Natural Areas and General Government decreased $1.7 million and $1.4 million, respectively. Business-type Expenses totaled $211.0 million in 2019, a decrease of $0.1 million compared to 2018. Water increased $1.4 million due to an increase in debt service while Light and Power only increased $0.6 million. On the other hand, Wastewater decreased $1.7 million primarily driven by a reduction in personnel services of $1.4 million, a decrease of 21.2%. BUSINESS-TYPE EXPENSES BY SERVICE 20152016201720182019 $3.2 $9.5 $19.5 $27.7 $124.3 $3.1 $10.8 $21.0 $25.6 $133.3 LIGHT & POWER WATER WASTEWATER STORMWATER GOLF $3.2 $9.9 $20.2 $26.4 $131.8 $3.2 $10.5 $20.5 $31.3 $145.6 $3.3 $10.7 $22.2 $29.9 $145.0 250M 200M 150M 100M 50M 20152016201720182019 $1.3 $57.6 $11.2 $35.4 $61.0 $47.7 $1.3 $51.5 $14.0 $47.3 $64.9 $46.7 GENERAL GOVERNMENT PUBLIC SAFETY CULTURE, PARKS, RECREATION AND NATURAL AREAS PLANNING AND DEVELOPMENT TRANSPORTATION INTEREST ON LONG-TERM DEBT $1.3 $58.3 $20.6 $44.4 $73.9 $45.4 $1.2 $72.0 $17.5 $46.6 $74.9 $45.4 $2.3 $73.0 $17.5 $44.9 $78.8 $44.0 300M 250M 200M 150M 100M 50M GOVERNMENT EXPENSES BY SERVICE 14 PEOPLE’S ANNUAL FINANCIAL REPORT 2019 SERVICE AREA Department General Fund Keep Fort Collins Great Fund Transportation Fund Capital Projects Fund Urban Renewal Authority Other Gov. Funds Grand Total POLICE SERV. TOTAL 44,079 6,107 ----50,186 Investigations 6,307 1,653 7,959 Police Information Serv. 8,613 1,322 9,935 Patrol 17,685 777 18,462 Community & Special Serv.6,163 1,978 8,141 Office of the Chief 5,312 378 5,690 FINANCIAL SERV. TOTAL 4,600 -----4,600 COMMUNITY & OPERATION SERV. TOTAL 25,984 4,454 -8,999 -29,165 68,603 Operation Services 12,375 0 1 12,376 Recreation 1,709 90 7,090 8,889 Community Serv. Admin. 308 51 -359 Park Planning & Dev. 173 6,040 4,135 10,349 Cultural Services 1,599 108 2,159 5,556 9,423 Parks 11,623 2,008 400 647 14,678 Natural Areas 79 405 309 11,737 12,531 PLANNING, DEV. & TRANS. TOTAL 10,317 14,799 23,930 16,877 - 26,176 92,099 PDT Administration 1,140 565 1,704 Transfort / Parking 2,186 199 25,466 27,850 Comm. Dev & Neighborhood Svcs. 9,174 115 9,289 FC Moves 3 726 557 301 1,588 Streets 9,563 16,648 104 26,314 Traffic 699 3,416 4,115 Engineering 1,511 2,744 16,376 607 21,238 EXECUTIVE SERVICES TOTAL 4,078 22 ----4,099 JUDICIAL SERVICES TOTAL 1,070 70 ----1,140 LEGAL SERVICES TOTAL 2,702 -----2,702 INFO. & EMPLOYEE SVCS. TOTAL 5,842 435 ----6,278 SUSTAINABILITY SERVICES TOTAL 5,710 1,479 - 21 10,629 1,265 19,103 Economic Health Office 1,787 152 120 2,059 Social Sustainability 1,859 637 1,145 3,641 Environmental Services 1,615 647 21 2,283 Administration 450 42 492 Urban Renewal Auth. 10,629 10,629 OTHER NON DEPT. TOTAL 1,674 ----6,096 7,770 POUDRE FIRE AUTHORITY TOTAL 26,716 3,109 - - - - 29,824 GRAND TOTAL $132,772 $30,475 $23,930 $25,897 $10,629 $62,703 $286,405 EXPENSES (CONTINUED) – WHERE DOES THE MONEY GO? Many expenditures of the City are segregated from other expenditures by a dedicated revenue source. Below is a breakdown by department of how proceeds from the various dedicated tax components are spent. Dedicated revenues, such as Keep Fort Collins Great, are contained to specified areas of spending by ballot language. Figures are in thousands and on a non-GAAP Budgetary Basis. CITY OF FORT COLLINS 15 TREASURY ADMINISTRATION WHERE’S THE MONEY KEPT? CASH & INVESTMENT MANAGEMENT Investment policies are governed by City Council adopted policy. The principal objective of the City's cash and investment strategy is preservation of investment principal. Thus, the policy allows for only fixed-income investments, such as state or local government debt, U.S. agency obligations, or highly rated U.S. corporate debt. Equity investments, such as common stock or mutual funds, are disallowed under the City’s policy. At Dec. 31, 2019, the fair market value of the City’s cash and investments was $577.9 million. The yield on market for the total assets in the portfolio for 2019 was 2.04 percent and total interest earnings were $16.0 million. BONDED DEBT OBLIGATIONS The City’s credit rating was Aaa by Moody’s Investors Service at Dec. 31, 2019. This highly favorable investment rating, maintained by only 4 percent of governments, allows the City to pay less interest on its debt issuances. At Dec. 31, 2019, the City held total bonded debt of $225.4 million. Of this amount, $58.2 million was related to government activities and $167.2 million was related to business-type activities. The debt service due within one year is $19.9 million. $147.9 M FEDERAL NAT’L MORTGAGE ASSOC. 11% FEDERAL FARM CREDIT BANK 26% CORPORATE BONDS 8% $64.1 M $120 M FEDERAL HOME LOAN BANK 15% $48.6M CASH & DEPOSITS 21% $87M FEDERAL HOME LOAN MORTGAGE CORP. 18%$105.4 M US TREASURIES AND CERTIFICATES OF DEPOSIT 1%$5M 201720182019 $0.5 $43.1 $181.7 REVENUE BONDS CERTIFICATES OF PARTICIPATION ASSIGNMENT OF LEASE PAYMENTS $1.0 $29.6 $52.1 $0.8 $24.1 $181.2 120M 100M 80M 60M 40M CASH & INVESTMENTS December 31, 2019 in millions CITY DEBT OBLIGATIONS December 31, 2019 in millions 16 PEOPLE’S ANNUAL FINANCIAL REPORT 2019 CAPITAL ASSETS WHAT DOES THE CITY OWN? The book value, historical cost less depreciation, of the City’s capital assets totaled $1.7 billion at Dec. 31, 2019. This investment in capital assets includes buildings and improvements, infrastructure and other improvements, including streets, bridges, and the full utility delivery system, land and right-of-way, various equipment and construction in progress. Total investment in capital assets increased $47.9 million compared to 2018. While the City reports its assets at net book value based on acquisition cost and accumulated depreciation, estimated fair market value is 2-3 times higher due to market appreciation of water rights, land and building values. This estimate is based on appraisal value, replacement cost, and/or insured values. INFRASTRUCTURE AND IMPROVEMENTS LAND AND LAND RIGHTS BUILDING AND IMPROVEMENTS MACHINERY AND EQUIPMENT CONSTRUCTION IN PROGRESS8%4 % 51%27%10 % GOVERNMENT CAPITAL ASSETS $921M BUSINESS-TYPE CAPITAL ASSETS $766M 55 %INFRASTRUCTURE AND IMPROVEMENTS BUILDINGS AND IMPROVEMENTS CONSTRUCTION IN PROGRESS MACHINERY AND EQUIPMENT LAND AND LAND RIGHTS 16 %15 %10 %4% CITY OF FORT COLLINS 17 GLOSSARY Assets — what the City of Fort Collins owns. Business-type activities — private sector-type operations, such as Utilities and Golf, where fees for services typically cover all or most of the cost of operations, including depreciation. Capital assets — items such as City or Utility land, construction in progress, equipment, infrastructure and buildings, and improvements net of depreciation. Component Unit — legally separate organizations for which the City is financially accountable. The Urban Renewal Authority, Downtown Development Authority, and General Improvement Districts #1 and #15 are the City’s component units. Current and other assets — items such as pooled cash and investments, cash and investments with fiscal agents, receivables, internal balances, inventories, deposits with others, prepaid items and deferred charges. Deferred inflows — an acquisition of a net asset that is applicable to a future reporting period. Deferred outflows — a consumption of a net asset that is applicable to a future reporting period. Fiduciary fund — accounts for assets held on behalf of outside parties, including other governments. Governmental activities — City basic services, including police, planning, economic development, and culture and recreation. Sales, use, and property taxes finance the majority of these services. Invested in capital assets, net of related debt — amounts invested in capital assets less accumulated depreciation and any outstanding debt used to acquire these assets. Liabilities — what the City of Fort Collins owes. Long-term liabilities — items such as bonds, loans, compensated absences, and other City of Fort Collins obligations. Net book value — represents the acquisition cost less accumulated depreciation for an asset. Net position — the difference between City of Fort Collins assets and liabilities. It is the net worth of the City. Other liabilities — items such as payables, payroll, accrued interest and unearned revenue. PILOT — payment in lieu of taxes, made to compensate the primary government for some or all of the tax revenue lost due to the tax-exempt status of the City’s utilities. Primary government — all of the governmental and business-type activities belonging to the City of Fort Collins excluding the discretely presented component units and fiduciary funds. Restricted — funds that are not available for use because they have been set aside for a specific purpose or project. Unrestricted — one-time funds available to use for operations or capital. 20-22408