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HomeMy WebLinkAbout2015-063-63A81.2Li(g4 is- I 8.3 aoky. b INDIAN RIVER COUNTY, FLORIDA ,0 ig COMPREHENSIVE ANNUAL FINANCIAL REPORT FOR THE FISCAL YEAR OCTOBER 1, 2013 THROUGH SEPTEMBER 30, 2014 Jeffrey R. Smith, CPA, CGFO, CGMA Clerk of the Circuit Court and Comptroller Prepared By: Clerk of the Circuit Court Finance Department Diane Bernardo, CPA Finance Director Indian River County, Florida COMPREHENSIVE ANNUAL FINANCIAL REPORT Fiscal Year Ended September 30, 2014 Board of County Commissioners as of September 30, 2014 Peter D. O'Bryan Joseph E. Flescher Chairman Bob Solari Wesley S. Davis Tim Zorc Vice -Chairman Current Board of County Commissioners (effective November 18, 2014) Wesley S. Davis Joseph E. Flescher Chairman Peter D. O'Bryan Bob Solari Tim Zorc Vice -Chairman Constitutional Officers as of September 30, 2014 Jeffrey R. Smith David C. Nolte Clerk of the Circuit Court and Comptroller Property Appraiser Leslie R. Swan Supervisor of Elections Joseph A. Baird County Administrator Michael Zito Assistant County Administrator Deryl Loar Sheriff County Management Jason Brown • Budget Director Carole Jean Jordan Tax Collector Dylan Reingold County Attorney Chris Mora Director of Public Works Stan Boling John W. King Director of Community Development Director of Emergency Services Vincent Burke Director of Utilities Indian River County, Florida COMPREHENSIVE ANNUAL FINANCIAL REPORT TABLE OF CONTENTS Fiscal Year Ended September 30, 2014 INTRODUCTORY SECTION Page Number LETTER OF TRANSMITTAL i ORGANIZATION CHART vii CERTIFICATE OF ACHIEVEMENT FOR EXCELLENCE IN FINANCIAL REPORTING viii FINANCIAL SECTION INDEPENDENT AUDITORS' REPORT 1 MANAGEMENT'S DISCUSSION AND ANALYSIS 5 BASIC FINANCIAL STATEMENTS: Government -wide Financial Statements: Statement of Net Position 21 Statement of Activities 23 Fund Financial Statements: Balance Sheet - Governmental Funds 24 Reconciliation of Total Governmental Fund Balances to Net Position of Governmental Activities 26 Statement of Revenues, Expenditures, and Changes in Fund Balances - Governmental Funds 28 Reconciliation of the Statement of Revenues, Expenditures, and Changes in Fund Balances of Governmental Funds to the Statement of Activities 30 Statement of Revenues, Expenditures, and Changes in Fund Balances Budget and Actual - General Fund 31 Statement of Revenues, Expenditures, and Changes in Fund Balances Budget and Actual - Impact Fees Fund 32 Statement of Revenues, Expenditures, and Changes in Fund Balances - Budget and Actual - Secondary Roads Construction Fund 33 Statement of Revenues, Expenditures, and Changes in Fund Balances - Budget and Actual -Transportation Fund 34 Statement of Revenues, Expenditures, and Changes in Fund Balances - Budget and Actual - Emergency Services District Fund 35 Statement of Fund Net Position - Proprietary Funds 37 Indian River County, Florida COMPREHENSIVE ANNUAL FINANCIAL REPORT TABLE OF CONTENTS - CONTINUED Fiscal Year Ended September 30, 2014 Page Number Statement of Revenues, Expenses, and Changes in Fund Net Position - Proprietary Funds 38 Statement of Cash Flows - Proprietary Funds 40 Statement of Fiduciary Net Position - Fiduciary Funds 44 Statement of Changes in Fiduciary Net Position - Other Postemployment Benefits Trust Fund • 45 Notes to the Financial Statements 47 REQUIRED SUPPLEMENTARY INFORMATION: Schedule of Funding Progress - Other Postemployment Benefits Plan 101 Schedule of Employer Contributions - Other Postemployment Benefits Plan 101 COMBINING AND INDIVIDUAL FUND STATEMENTS AND SCHEDULES: Combining Balance Sheet - Nonmajor Governmental Funds 108 Combining Statement of Revenues, Expenditures and Changes in Fund Balances - Nonmajor Governmental Funds 116 Budgetary Comparison Schedules 124 Combining Statement of Net Position - Internal Service Funds 156 Combining Statement of Revenues, Expenses, and Changes in Fund Net Position - Internal Service Funds 157 Combining Statement of Cash Flows - Internal Service Funds 158 Combining Statement of Changes in Assets and Liabilities - Agency Fund 162 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 Indian River County, Florida COMPREHENSIVE ANNUAL FINANCIAL REPORT TABLE OF CONTENTS- CONTINUED Fiscal Year Ended September 30, 2014 STATISTICAL SECTION Page Number SCHEDULE 1 Net Position by Component - Last Ten Fiscal Years 164 SCHEDULE 2 Changes in Net Position - Last Ten Fiscal Years 166 SCHEDULE 3 Fund Balances, Governmental Funds - Last, Ten. Fiscal Years 170 SCHEDULE 4 Changes in Fund Balances, Governmental Funds - Last Ten Fiscal Years 172 SCHEDULE 5 Tax Revenues by Source, Governmental Funds - Last Ten Fiscal Years 174 SCHEDULE 6 Assessed Value and Actual Values of Taxable Property - Last Ten Fiscal Years 175 SCHEDULE 7 Property Tax Rates - Direct and Overlapping Tax Rates - Last Ten Fiscal Years 176 SCHEDULE 8 Principal Property Taxpayers - Year 2014 and Year 2005 178 SCHEDULE 9 Property Tax Levies and Collections - Last Ten Fiscal Years 179 SCHEDULE 10 Ratios of Outstanding Debt by Type - Last Ten Fiscal Years 180 SCHEDULE 11 Ratio of Net General Bonded Debt Outstanding to Taxable Value and Net Bonded Debt Per Capita - Last Ten Fiscal Years 182 SCHEDULE 12 Computation of Legal Debt Margin 183 SCHEDULE 13 Direct and Overlapping Governmental Activities Debt 184 SCHEDULE 14 Pledged Revenue Coverage - Water and Sewer Revenue Bonds - Last Ten Fiscal Years 186 SCHEDULE 15 SCHEDULE 16 SCHEDULE 17 SCHEDULE 18 SCHEDULE 19 SCHEDULE 20 SCHEDULE 21 SCHEDULE 22 SCHEDULE 23 SCHEDULE 24 SCHEDULE 25 Indian River County, Florida COMPREHENSIVE ANNUAL FINANCIAL REPORT TABLE OF CONTENTS- CONTINUED Fiscal Year Ended September 30, 2014 Demographic and Economic Statistics - Last Ten Years Principal Employers - Year 2014 and Year 2005 Building Permits - Last Ten Fiscal Years Operating Indicators by Function/Program - Last Ten Fiscal Years Full Time Equivalent County Government Employees by Function/Program - Last Ten Fiscal Years Capital Asset Statistics by Function/Program - Last Ten Fiscal Years Department of Utility Services - Historical Rate Structure - Last Ten Fiscal Years Water and Wastewater Customers - Last Ten Fiscal Years Top 10 High Volume Customers of Utility Services Capacity Charges - Utilities Department - Last Ten Fiscal Years Pledged Revenues for Spring Training Facility Revenue Bonds, Series 2001 - Last Ten Fiscal Years Page Number 188 189 190 192 196 198 202 203 204 205 206 Indian River County, Florida COMPREHENSIVE ANNUAL FINANCIAL REPORT TABLE OF CONTENTS- CONTINUED Fiscal Year Ended September 30, 2014 COMPLIANCE SECTION Page Number Report on Internal Control over Financial Reporting and on Compliance And Other Matters Based on an Audit of Financial Statements Performed In Accordance with Government Auditing Standards 207 County Management Letter 209 Independent Accountants' Report 211 Federal and State Grants: Independent Auditors' Report on the Schedule of Expenditures of Federal Awards and State Projects Required by OMB Circular A-133 and Chapter 10.550, Rules of the Auditor General Schedule of Expenditures of Federal Awards and State Projects Notes to Schedule of Expenditures of Federal Awards and State Projects 212 213 218 Independent Auditors' Report on Compliance with Requirements that Could Have A Direct and Material Effect on Each Major Federal Program and Major State Project and on Internal Control over Compliance in Accordance with OMB Circular A-133 and Chapter 10.550, Rules of the Auditor General 219 Schedule of Findings and Questioned Costs 221 Summary Schedule of Prior Audit Findings 223 Impact Fee Affidavit 224 Indian River County, Florida COMPREHENSIVE ANNUAL FINANCIAL REPORT TABLE OF CONTENTS- CONTINUED Fiscal Year Ended September 30, 2014 AUDITOR GENERAL REPORTS SECTION BOARD OF COUNTY COMMISSIONERS Independent Auditors' Report Fund Financial Statements Report on Internal Control over Financial Reporting and on Compliance And Other Matters Based on an Audit of Financial Statements Performed In Accordance with Government Auditing Standards Management Letter Independent Accountants' Report CLERK OF THE CIRCUIT COURT AND COMPTROLLER Independent Auditors' Report Fund Financial Statements Report on Internal Control over Financial Reporting and on Compliance And Other Matters Based on an Audit of Financial Statements Performed In Accordance with Government Auditing Standards Management Letter Independent Accountants' Report PROPERTY APPRAISER Independent Auditors' Report Fund Financial Statements Report on Internal Control over Financial Reporting and on Compliance And Other Matters Based on an Audit of Financial Statements Performed In Accordance with Government Auditing Standards Management Letter Independent Accountants' Report 1 1 1 Page Number 226 228 1 290 292 294 1 296 298 309 311 313 1 316 318 324 1 326 328 1 1 1 1 1 1 Indian River County, Florida COMPREHENSIVE ANNUAL FINANCIAL REPORT TABLE OF CONTENTS -CONTINUED Fiscal Year Ended September 30, 2014 SHERIFF Page Number Independent Auditors' Report 330 Fund Financial Statements 332 Report on Internal Control over Financial Reporting and on Compliance And Other Matters Based on an Audit of Financial Statements Performed In Accordance with Government Auditing Standards 342 Schedule of Findings and Responses 344 Management Letter 346 SUPERVISOR OF ELECTIONS Independent Auditors' Report 350 Fund Financial Statements 352 Report on Internal Control over Financial Reporting and on Compliance And Other Matters Based on an Audit of Financial Statements Performed In Accordance with Government Auditing Standards 360 Management Letter 362 TAX COLLECTOR Independent Auditors' Report 366 Fund Financial Statements 368 Report on Internal Control over Financial Reporting and on Compliance And Other Matters Based on an Audit of Financial Statements Performed In Accordance with Government Auditing Standards 378 Management Letter 380 Independent Accountants' Report 382 Mill MB§ PM Elle ME ISIN ME MIN ISIN EU We OM EEO ® ME EMI Mil I ME JEFFREY R. SMITH, CPA, CGFO, CGMA Clerk of Circuit Court & Comptroller 1801 27th Street Vero Beach, FL 32960 Telephone: (772) 226-1945 March 6, 2015 To the Citizens of Indian River County: The Comprehensive Annual Financial Report of Indian River County, Florida for the fiscal year ended September 30, 2014, is respectfully submitted. State law requires that every general-purpose government publish a complete set of audited financial statements within nine months of the close of each fiscal year. This report was prepared by the Finance Department under the supervision of the Clerk of the Circuit Court and Comptroller. Responsibility for both the accuracy of the presented data and the completeness and fairness of the presentation, including all disclosures, rests with the Finance Department and is contingent upon the internal control established for this purpose. The County has established a comprehensive internal control framework designed to ensure that the assets of the County are protected from loss, theft or misuse and to certify that the financial records and data used for preparing the financial statements are in conformity with generally accepted accounting principles (GAAP) as applicable to governmental entities. The internal control system is designed to provide reasonable, rather than absolute, assurance that these objectives are met. The idea of reasonable assurance recognizes two aspects: 1) the cost of internal control should not exceed the anticipated benefits; and 2) the valuation of the costs and benefits require estimates and judgment by management. All internal control evaluations take place within this framework. We believe the County's internal controls adequately safeguard its assets and provide reasonable assurance of properly recorded financial transactions. Section 218.39, Florida Statutes, requires an annual audit of local governments. The unqualified opinion of the auditors (Rebmann Robson, Certified Public Accountants) on the County's financial statements for the year ended September 30, 2014 has been included in this report. The independent auditors' report is located at the front of the financial section of this report. The audit was also designed to meet the requirements of Government Auditing Standards, the Florida Single Audit Act, the Federal Single Audit Act of 1984, the Federal Single Audit Act Amendments of 1996, and revised OMB Circular A- 133. Readers of this report are encouraged to read Management's Discussion and Analysis (MD&A), which provides basic financial information about the County and an overview of the County's activities. The MD&A immediately follows the independent auditors' report. i Profile of Indian River County Indian River County, established on June 29, 1925 by an act of the Florida Legislature, is located on the central Atlantic coast of Florida, approximately 100 miles southeast of Orlando and 135 miles north of Miami. The County is bordered by Brevard County to the north, St. Lucie County to the south, and Osceola and Okeechobee Counties on the west. There are approximately 100 miles of waterfront land in the County, including 23 miles of Atlantic beaches. The City of Vero Beach is the seat of County government. Indian River County is a non -charter county established under the Constitution and the Laws of the State of Florida. It is governed by a five member Board of County Commissioners (Board) elected at large from the five districts within the County. A County Administrator is appointed by the Board and is responsible for implementing the policies set forth by the Board. The Administrator is charged with the fiscal control of the resources of the County as well. In addition to the Board, there are five elected Constitutional Officers serving specific governmental functions: Clerk of the Circuit Court and Comptroller, Property Appraiser, Sheriff, Supervisor of Elections and Tax Collector. Although the funding for all Constitutional Offices is part of the County's General Fund, the Board does not have direct responsibility for their operations. Each office is run separately within each of its respective legal guidelines. Indian River County provides a full range of services including, but not limited to: construction and maintenance of roadways, sidewalks and other infrastructure, fire rescue/emergency services, law enforcement, library services, traffic operations and control, parks and recreational services, human services, building inspections, licenses and permits, water/sewer utility services, and refuse collection and disposal. The Clerk of the Circuit Court and Comptroller (Clerk), Sheriff, and Supervisor of Elections submit proposed operating budgets to the Board prior to May 1. The Florida Department of Revenue receives budgets from the Property Appraiser prior to June 1 and from the Tax Collector prior to August 1. Once these budgets are approved, they are forwarded to the Board. The court -related function of the Clerk submits a budget to the Florida Clerks of Court Operations Corporation (CCOC) prior to June 1. These operating budgets include proposed expenditures and the sources to finance them as set forth in Section 28.36, Florida Statutes. Constitutional Officers, all departments controlled by the Board of County Commissioners, and outside State and local agencies submit their proposed budgets to the Office of Management and Budget for assistance, review and compilation. The County Administrator then reviews all the budgets of the County departments, state agencies and nonprofit organizations, and makes his budget recommendations to the Board of County Commissioners on or before July 15 of each year. During September, public hearings are held pursuant to Section 200.065, Florida Statutes, in order for the Board to receive public input on the tentative budget. At the end of the last public hearing, the Board enacts ordinances to legally adopt (at the fund level) the budgets for all governmental fund types. The budgets legally adopted by the Board set forth the anticipated revenues by source and the appropriations by function. Budgets for Enterprise and Internal Service funds are adopted on a basis consistent with generally accepted accounting principles. Management is authorized to transfer budgeted amounts between objects and departments in any fund as long as the total appropriations of a fund are not exceeded. Board approval to amend the budget is required when unanticipated revenues are received that management wishes to have appropriated, thereby increasing the total appropriations of a fund. Appropriations for the County lapse at the close of the fiscal year. ii This Comprehensive Annual Financial Report (CAFR) includes the funds of the primary government (the Board of County Commissioners, the Clerk of the Circuit Court and Comptroller, the Property Appraiser, the Sheriff, the Supervisor of Elections and the Tax Collector), and the blended component units consisting of the Emergency Services District and the Solid Waste Disposal District. These component units were included because generally accepted accounting principles require that organizations which are fiscally dependent on the County and that financially benefit from the relationship with the County be reported with the primary government (the County) as the reporting entity. This CAFR does not include the Indian River County School District, the Indian River County Mosquito Control District or the Indian River Medical Center. Local Economy Indian River County's population of 140,955 was a 1.0% increase over the previous year. While the population of the County has been steadily increasing, so has the median age of residents living here. Nationally, average ages have risen due to the increasing age of the baby boomer generation as well as the increase in life expectancy for all Americans. In addition, Florida continues to be a popular destination for retirees. According to the University of Florida, Bureau of Economic and Business Research, persons aged 45-64 now make up the largest percentage of residents in the County, followed by persons aged 65+, 18-44, 0-17 respectively. The median age of Indian River County is 49.1 which is 20.6% above the State median age of 40.7 and 32.3% above the national median age of 37.1. Historically, Indian River County's economy was made up of agriculture (citrus and cattle) and tourism. Those industries have been now been complimented with an increase in health care and information technology firms, light manufacturing, wholesale and retail trade and service sector jobs. The top three major employers in Indian River County, providing 9% of total County employees, are the School District, Indian River County Government and Indian River Medical Center. The unemployment rate decreased from 8.8% in 2013 to 7.9% in 2014. Piper Aircraft, Inc., whose headquarters for aircraft research, development and manufacturing operations are located in Vero Beach, is the largest manufacturing employer in the area. CVS Pharmacy operates a distribution center which provides the distribution of products to all CVS locations in the southern half of Florida. INEOS New Planet BioEnergy opened a state of the art center in Indian River County. The facility converts low-cost organic materials such as household and vegetative waste into bioethanol for use as a renewable road transport fuel (ethanol) while generating renewable power for export to the local electricity grid. This new technology will reduce greenhouse gas emissions from cars and energy generation in addition to reducing the amount of waste going into our landfills. The Atlantic beaches and the Indian River, along with the comfortable climate, provide the basis for a year-round tourism industry. Residents can enjoy these resources at any of the County parks, the Sebastian Inlet State Park or the Pelican Island National Wildlife Refuge. Indian River County is beginning to experience signs of improvement in the economy. Total property tax values increased slightly from $12.7 billion in 2013 to $12.8 billion in 2014. Construction activity saw a significant increase with 23% more building permits issued for additions and alterations in 2014 over 2013. Please see Statistical Schedules 6 and 17 for more information. Although Indian River County is a major producer of citrus with approximately 32,820 acres dedicated to citrus production, production has decreased by 5.1% from 8.2 million boxes in 2013 to 7.8 million in 2014. iii Long Term Financial Planning and Major Initiatives Chapter 163 Florida Statutes and Florida Administrative Code Rule 9J-5 requires each local government to have a Comprehensive Land Use Plan. An important part of this plan is the Capital Improvements Program (CIP) which evaluates the need for public facilities in support of the Future Land Use Element, to estimate the costs of improvements for which local government has fiscal responsibility, to analyze the fiscal capacity of the local government to finance and construct improvements, and to adopt financial policies to guide the funding and construction of the improvements. The CIP is updated annually and encompasses a period of five years. Listed below are six major capital projects included in the current CIP along with the source of funding and capital costs: • Fire/EMS Station 13 - Construction of an additional station is necessary to serve the expanding south county population. The Emergency Services District reserves will provide $1.7 million with the remaining $850,000 being funded by impact fees. The operating expense will be approximately $2.1 million. • Osprey Marsh - The County is constructing the second algal turf scrubber (ATS) system called the "Osprey Marsh" for the south relief canal. The ATS will remove dissolved nitrogen and phosphorous from the water and return the treated water back to the Indian River lagoon where it will enhance water quality and thereby support the resurgence of sea grasses in the lagoon. This project is a collaborative effort between the Utilities Department and the Stormwater Division. It is being funded through a combination of capacity charges, one cent sales tax and grants at an estimated cost of $8.6 million. • South County Park — Phase III Improvements - The expansion of this park is necessary to provide recreation facilities and programs to the growing population in the southern part of the County. A multi-purpose intergenerational facility will be constructed at a cost of $6.9 million with impact fees and one cent sales tax providing the funding. Ad valorem tax proceeds and user fees as well as partnering agency contributions will fund increased operating costs which are estimated to be about $118,000 per year. • 66th Avenue Widening — The widening of 66th Avenue from State Road 60 in Vero Beach to 49th Street is currently underway. This is one of the few main arterials connecting the north and south county areas and traffic has increased substantially on this road. Construction costs are over $20 million. Funding is from traffic impact fees, gas taxes and grants. In the future, the County plans to expand 66th Avenue from 49th Street to the Sebastian City limits. • CR 510 - 70th Avenue to Indian River — This roadway is scheduled for widening at an estimated cost of $7.1 million for right of way and $21 million for construction. Traffic impact fees, optional sales tax and gas taxes will provide the funding. • Segment II Landfill Closure - Segment II of the landfill will reach capacity in FY 14-15. The County has been accruing the cash on an annual basis to cover the estimated $4.5 million closure costs. State and Federal regulations required that the Solid Waste Disposal District (SWDD) provide funding for the closure and long-term maintenance costs of each segment of the landfill as capacity is used. The SWDD user fees provide the funding source. Operating costs for the new cell should remain about the same as for the current segment. iv Relevant Financial Policies In accordance with Section 218.415, Florida Statutes, the County adopted an investment policy, which guides the investment of County surplus funds. This policy establishes investment objectives, maturity and liquidity requirements, portfolio composition, risk and diversification requirements, and authorized investments. The primary objectives of investment activities are to preserve capital and maintain sufficient liquidity to meet anticipated cash flow needs. The secondary objective is to obtain competitive returns on the investment of County surplus funds. During fiscal year 2014, County investments had yields ranging from 0.05% to 0.70%. The overall annual yield of the portfolio as of September 30, 2014 was 0.30%. On September 23, 2008, the County established the OPEB (Other Post -Employment Benefits) Trust. An OPEB investment policy was approved by the Board of County Commissioners on February 3, 2009 and revised on April 6, 2010. The objective was to establish an advisory committee and to provide short- term and long-term investment guidelines. This policy also outlines the same criteria as noted in the County's investment policy, as well as including performance measures. The change in net position for the OPEB Trust for the fiscal year was $2.5 million. In addition, interest, dividend and mark -to -market adjustments resulted in net investment income of $764,319. The OPEB Trust annual yield was 5.92%. During FY 2014, the County approved a $630,000 interfund loan from the general fund to the golf course fund for construction of a new irrigation system. This mechanism will provide funds at a relatively low interest rate for the golf course (1.0%) as well as provide increased interest earnings for the general fund. The County's goal is to maintain an overall fund balance equal to 30% of the annual budget in all of its taxing funds, which provides a three month cushion for operating expenses. The three month reserve is necessary due to the timing of property tax levies in the State of Florida. Although the fiscal year begins in October, property tax monies are not typically received until mid to late December, which would require the County to operate in a deficit position for the first two months of the fiscal year without this reserve. Reserve funds are needed in order to allow the County to respond to events without facing serious financial burdens. County policy is to maintain fund balance levels and prohibit the use of fund balance to fund recurring expenses. Information 6n the County's fund balance policy can be found in County Note 19. In September 2014, Fitch Rating Service affirmed three ratings on Indian River County: • "AA+" on Spring Training Facility Revenue Bonds, Series 2001 • "A-" on Limited General Obligation Bonds, Series 2006 • "AAA" on implied unlimited tax general obligation In summary, Indian River County completed the year financially strong and well positioned. In a time of a strained world-wide economy and low investment returns, the County stood committed to manage funds and services for its citizens. v Awards and Acknowledzements The Government Finance Officers Association of the United States and Canada (GFOA) awarded a Certificate of Achievement for Excellence in Financial Reporting to Indian River County for its comprehensive annual financial report (CAFR) for the fiscal year ended September 30, 2013. This was the 31st consecutive year that the County has received this prestigious award. In order to be awarded a Certificate of Achievement, a government must publish an easily readable and efficiently organized comprehensive annual financial report. This report must satisfy both generally accepted accounting principles and applicable legal requirements. 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 Certificate of Achievement Program's requirements and we are submitting it to the GFOA to determine its eligibility for another certificate. In addition, Indian River County also received the GFOA's Distinguished Budget Presentation Award for its annual budget document for the 2013-2014 fiscal year. This was the 23rd consecutive year that the County has received this prestigious award. In order to qualify for the Distinguished Budget Presentation Award, the County's budget document had to be judged proficient as a policy document, financial plan, operations guide, and communications device. I would like to thank the entire staff of the Finance Department for their invaluable assistance in the preparation of this report. I would also like to thank the Board of County Commissioners and their staff, and the other Constitutional Officers for their personal interest and support in planning and conducting the financial operations of the County in a responsible and progressive manner. Finally, thanks to the citizens for the trust you continue to place in your County and those who work to serve you. Respectfully submitted, Jeffrey R. Smith, CPA, CGFO, CGMA Clerk of the Circuit Court and Comptroller vi Indian River County BCC Departmental Organization Reside Indian Rivernts County I 1 Clerk of Circuit Sheriff Court Finance I Department Assistant County Administraor/ General Services 1 Supervisor of I Elections 1 Board of Property I Tax I County Appraiser Collector Commissioners County Administrator County Attorney Assistant to Administrator Commission Office Golf Course Parks and Recreation Veterans Services Shooting I Range Libraries • Public Works Utilities Services Geographic Info Systems Office of Management & Budget Engineering Wastewater Treatment Human Resources Mailroom Switchboard Human Services Roads & I Bridges Traffic Fleet I Manaeement Secondary Road Construction Water Production Planning Division Risk Management General & Engineering • Biosolids Operations Fire / Rescue Environmental Planning & Code Enforcement Computer Services Radiological Emergency Preparedness IRCLHAP / SHIP Program Customer Service Emergency Base Grant Stormwater Wastewater Collection Metropolitan Planning Oreanization Animal Control Building Division Coastal Engineerine Facilities 1 Management Osprey Marsh 911 Coordinator Soil & Water Conservation Rental Assistance — Telecommunications Solid Waste Disposal District Aa Extension vii Purchasing. Government Finance Officers Association Certificate of Achievement for Excellence in Financial Reporting Presented to Indian River County Florida For its Comprehensive Annual Financial Report for the Fiscal Year Ended September 30, 2013 de0A07, Executive Director/CEO viii 1 1 N e h m a n n Rehmann Robson R 5070 North Highway MA Suite 250 Vero Beach, FL 32963 Ph 772 234.8484 Fx 772 234 8488 rehmann.com 1 INDEPENDENT AUDITORS' REPORT 1 March 4, 2015 The Honorable Board of County Commissioners and Constitutional Officers Indian River County, Florida Report on the Financial Statements We have audited the accompanying financial statements of the governmental activities, the business- !' type activities, each major fund, and the aggregate remaining fund information of Indian River County, Florida (the "County"), as of and for the year ended September 30, 2014, and the related notes to the financial statements, which collectively comprise the County'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 1 or error. Independent Auditors' 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 of 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 auditors' 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 County'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 County'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. ' Rehmann is an independent member of Nexia International. CPAs & Consultants Wealth Advisors Corporate Investigators 1 INTERNATIONAL. The Honorable Board of County Commissioners and Constitutional Officers March 4, 2015 Page 2 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, each major fund, and the aggregate remaining fund information of Indian River County, Florida as of September 30, 2014, and the respective changes in financial position and, where applicable, cash flows thereof, and the respective budgetary comparison for the general fund and each major special revenue fund, for the year then ended in accordance with accounting principles generally accepted in the United States of America. Restatement of Beginning Net Position of Governmental Activities As described in Note 21B to the financial statements, the beginning net position of the governmental activities was restated (i.e., decreased) by $15,488,462 to record accumulated depreciation not previously reported on capital assets. Our opinion is not modified with respect to this matter. Other Matters Required Supplementary Information Accounting principles generally accepted in the United States of America require that the management's discussion and analysis and the pension and postemployment benefit information as listed in the table of content 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 County's basic financial statements. The combining and individual fund financial statements and schedules, and introductory and statistical sections are presented for purposes of additional analysis and are not a required part of the basic financial statements. The combining and individual fund financial statements and 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, the information is fairly stated, in all material respects, in relation to the basic financial statements as a whole. 2 The Honorable Board of County Commissioners and Constitutional Officers March 4, 2015 Page 3 The.introductory and statistical sections 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 March 4, 2015, on our consideration of Indian River County, Florida'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 the County's internal control over financial reporting and compliance. LLC EMI MEI ® ® Ma ME NMI =I EMI EEO 11112 EMI BIM =I II= MEM ME 0111 MB Indian River County, Florida Management's Discussion and Analysis For the Year Ended September 30, 2014 We offer readers of the County's financial statements this narrative overview and analysis of the financial activities of the County for the fiscal year ended September 30, 2014. We encourage readers to consider the information presented here, in conjunction with additional information that we have furnished in our letter of transmittal, which can be found on pages i -vi of this report. FINANCIAL HIGHLIGHTS • The County's overall financial position improved over 2013. • The assets and deferred outflows of resources of the County exceeded its liabilities by $1,003.9 million (net position). Of this amount, $161.3 million (unrestricted net position) may be used to meet the government's ongoing obligations to citizens and creditors. • The government's total net position increased by $11.7 million. Governmental activities accounted for $11.9 million of this increase while business -type activities accounted for a $0.2 million decrease. Further information can found on page 8. • Governmental activities expenses reflected a 2.6% decrease ($151.6 million in 2013 to $147.6 million in 2014) and business -type activities expenses reflected a 5.6% increase ($48.3 million in 2013 to $51.0 million in 2014). Further information can found on page 10. • Unassigned fund balance for the general fund was $48.3 million, or an 8.8% increase from the prior year general fund unassigned balance of $44.4 million. Contributing to this increase was that in fiscal year 2014, the County no longer appropriated existing fund balance to balance the budget. In addition, there was a reclassification of committed fund balance for economic incentives to unassigned for local jobs grant funds that expired. OVERVIEW OF FINANCIAL STATEMENTS This discussion and analysis is intended to serve as an introduction to the County's basic financial statements. The County's basic financial statements are composed of three elements: 1) government - wide financial statements, 2) fund financial statements, and 3) notes to the financial statements. This report also contains other supplementary information in addition to the basic financial statements themselves. Government -wide financial statements The government -wide financial statements are designed to provide readers with a broad overview of the County's finances, in a manner similar to a private -sector business. The Statement of Net Position presents information on all of the County's assets, liabilities, and deferred inflows/outflows of resources, with the difference reported as net position. Over time, increases or decreases in net position may serve as a useful indicator of whether the financial position of the County is improving or deteriorating. 5 Indian River County, Florida Management's Discussion and Analysis For the Year Ended September 30, 2014 The Statement of Activities presents information showing how the government's net position changed during the most recent fiscal year. All changes in net position are reported as soon as the underlying event giving rise to the change occurs, regardless of the timing of related cash flows. Thus, revenues and expenses are reported in this statement for some items that will only result in cash flows in future fiscal periods (e.g., uncollected grant revenue and earned, but unused, vacation leave). Both of the government -wide financial statements distinguish functions of the County 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 County include general government, public safety, physical environment, transportation, economic environment, human services, culture and recreation, and court related functions. The major business -type activities include a water and sewer utility, a solid waste disposal district, a golf course, and a building department. The government -wide financial statements include not only the Board of County Commissioners (BCC), but also the Clerk of the Circuit Court and Comptroller, Property Appraiser, Sheriff, Supervisor of Elections and Tax Collector. The government -wide financial statements can be found on pages 21 and 23 of this report. Fund financial statements A fund is a grouping of related accounts that is used to maintain control over resources that have been segregated for specific activities or objectives. The County, like other state and local governments, uses fund accounting to ensure and demonstrate compliance with finance -related legal requirements. All of the funds of the County can be divided into three categories: governmental funds, proprietary funds, and fiduciary funds. Governmental funds. Governmental funds are used to account for essentially the same functions reported as governmental activities in the government -wide financial statements. However, unlike the government -wide financial statements, governmental fund financial statements focus on near-term inflows and outflows of spendable resources, as well as on balances of spendable resources available at the end of the fiscal year. Such information may be useful in evaluating a government's near-term financial requirements. Because the focus of governmental funds is narrower than that of the government -wide financial statements, it is useful to compare the information presented for governmental funds with similar information presented for governmental activities in the government -wide financial statements. By doing so, readers may better understand the long-term impact of the government's near-term financial decisions. Both the governmental fund Balance Sheet and the governmental fund Statement of Revenues, Expenditures, and Changes in Fund Balances provide a reconciliation to 'facilitate this comparison between governmental funds and governmental activities. The County maintains 35 individual governmental funds. Information is presented separately in the governmental fund Balance Sheet and in the governmental fund Statement of Revenues, Expenditures, and Changes in Fund Balances for the general fund, four special revenue funds, and one capital project fund. All are considered to be major funds. Data from the other 29 governmental funds are combined into a single, aggregated presentation. 6 1 Indian River County, Florida Management's Discussion and Analysis • For the Year Ended September 30, 2014 Individual fund data for each of these nonmajor governmental funds is provided in the form of combining statements located behind the notes to the financial statements. The combining statements for the nonmajor governmental funds can be found on pages 103-153 of this report. The County adopts an annual appropriated budget for its general fund. A budgetary comparison statement has been provided for the general fund to demonstrate compliance with this budget. The basic governmental fund financial statements can be found on pages 24-35 of this report. Proprietary funds. The County maintains two different types of proprietary funds. Enterprise funds are used to report the same functions presented as business -type activities in the government -wide financial statements. The County uses enterprise funds to account for its water and sewer utility, solid waste disposal district, golf course, and building department. Internal service funds are an accounting device used to accumulate and allocate costs internally among the County's various functions. The County uses internal service funds to account for fleet management, self-insurance, and information technology. Because these services predominantly benefit governmental rather than business -type functions, they have been included within governmental activities in the government -wide financial statements. Proprietary fund financial statements provide the same type of information as the government -wide financial statements, only in more detail. The proprietary fund financial statements provide separate information for the water and sewer utility, solid waste disposal district, golf course, and building department, which are considered to be major funds of the County. Conversely, internal service funds are combined into a single, aggregated presentation in the proprietary fund financial statements. Individual fund data for the internal service funds is provided in the form of combining statements behind the notes to the financial statements on pages 155-159 of this report. The basic proprietary fund financial statements can be found on pages 37-43 of this report. Fiduciary funds. Fiduciary funds are used to account for resources held for the benefit of parties outside the government. The Indian River County OPEB Trust holds the assets of the County's other postemployment benefits. Fiduciary funds are not reflected in the government -wide financial statements because the resources of those funds are not available to support the County's own programs. The accounting used for fiduciary funds is much like that used for proprietary funds. The basic fiduciary fund financial statements can be found on pages 44-45 of this report. Notes to the financial statements The notes provide additional information that is essential to a full understanding of the data provided in the government -wide and fund financial statements. The notes to the financial statements can be found on pages 47-100 of this report. Other Information In addition to the basic financial statements and accompanying notes, this report also contains required supplementary information concerning Indian River County's progress in funding its obligations to provide other postemployment benefits to its employees. Required supplementary information can be found on page 101 of this report. 7 Indian River County, Florida Management's Discussion and Analysis For the Year Ended September 30, 2014 Government -wide Financial Analysis As noted earlier, net position may serve over time as a useful indicator of a government's financial position. In the case of the County, assets and deferred outflows of resources exceeded liabilities by $1,003.9 million at the close of the fiscal year. Current and other assets Capital assets Total assets Indian River County Net Position (In Millions) Governmental Business -type Activities Activities Total 2014 2013 2014 2013 2014 2013 $ 221.0 $ 223.8 $ 107.5 $ 111.1 $ 328.5 $ 334.9 549.1 540.9 248.9 251.3 798.0 792.2 770.1 764.7 356.4 362.4 1,126.5 1,127.1 Deferred outflows of resources - - 2.2 2.5 2.2 2.5 Total deferred outflows - - 2.2 2.5 2.2 2.5 Long-term liabilities 56.3 60.7 51.8 54.9 108.1 115.6 Other liabilities 10.0 12.1 6.7 9.7 16.7 21.8 Total liabilities 66.3 72.8 58.5 64.6 124.8 137.4 Net position: Net investment in capital assets 514.7 502.8 211.7 210.7 726.4 713.5 Restricted 116.2 117.3 20.9 116.2 138.2 Unrestricted 72.9 71.8 88.4 68.7 161.3 140.5 Total net position $ 703.8 $ 691.9 $ 300.1 $ 300.3 $ 1,003.9 $ 992.2 The capital assets and net investment in capital assets for governmental activities for 2013 have been reduced by $15.5 million to reflect the adjustment to beginning net position for accumulated depreciation not previously reported on some County assets. See Note 21B for further information on this restatement. Overall, the County's net position increased $11.7 million or 1%. Governmental activities net position increased by $11.9 million and business -type activities decreased by $0.2 million. Governmental Activities In governmental activities, the increase in unrestricted net position was due to the reduction of economic incentives and appropriation of fund balance from the prior year. The increase in net investment in capital assets and decrease in restricted net position was a result of road construction, recreational, and public safety projects. Business -type Activities In business -type activities, the increase in unrestricted net position and decrease in restricted net position was due to the reclassification of water and sewer capital projects funds previously reported as restricted. The decrease in net investment in capital assets was due to depreciation expense. 8 Indian River County, Florida Management's Discussion and Analysis For the Year Ended September 30, 2014 Indian River County Net Position (In millions) September 30, 2013 and 2014 net investment in capital assets restricted unrestricted 7 0 200 400 600 800 ❑ 2013 ❑ 2014 By far, the largest portion of the County's net position (72% or $726.4 million) reflects its investment in capital assets (e.g., land, buildings, infrastructure, intangibles, machinery, and equipment), less any related outstanding debt used to acquire those assets. The County uses these capital assets to provide services to citizens; consequently, these assets are not available for future spending. Although the County's investment in its capital assets is reported as 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. A portion of the County's net position (12% or $116.2 million) represents resources that are subject to external restrictions on how they may be used. The remaining balance of the unrestricted net position ($161.3 million) may be used to meet the government's ongoing obligations to citizens and creditors. 9 Indian River County, Florida Management's Discussion and Analysis For the Year Ended September 30, 2014 Indian River County Changes in Net Position (In Millions) Revenues: Program revenues: Charges for services Operating grants/contributions Capital grants/contributions General revenues: Property taxes Sales taxes Franchise fees Other Total revenues Expenses: General government Public safety Physical environment Transportation Economic environment Human services Culture/recreation Court related Interest and fiscal charges Water and sewer Solid waste Golf course Building Total expenses Increase (decrease) in net position before transfers Transfers Governmental Business -type Activities Activities Total 2014 2013 2014 2013 2014 2013 $ 23.0 $ 18.2 $ 45.3 $ 43.6 $ 68.3 $ 61.8 22.2 26.9 - - 22.2 26.9 7.5 6.7 5.0 4.7 12.5 11.4 72.7 67.0 - - 72.7 67.0 21.9 21.0 - 21.9 21.0 9.3 8.8 - 9.3 8.8 3.0 3.5 0.4 0.5 3.4 4.0 159.6 152.1 50.7 48.8 210.3 200.9 23.0 20.6 66.9 66.2 1.0 1.9 23.6 26.3 1.1 2.5 7.1 6.8 16.6 19.4 6.4 5.8 1.9 2.1 147.6 151.6 12.0 (0.04) Increase (decrease) in net position 11.9 Net position - October 1, 2013 Adjustments to net position Net position - September 30, 2014 691 9 $ 703.8 10 23.0 20.6 - - 66.9 66.2 - 1.0 1.9 - - 23.6 26.3 - 1.1 2.5 7.1 6.8 16.6 19.4 6.4 5.8 - - 1.9 2.1 35.8 33.8 35.8 33.8 10.8 10.4 10.8 10.4 2.6 2.5 2.6 2.5 1.8 1.6 1.8 1.6 51.0 48.3 198.6 199.9 11 1 1 1 1 1 0.5 (0.3) 0.5 11.7 1 0 8 - 0.04 - - - 0.5 (0.2) 0.5 11.7 1.0 1 706.9 300.3 299.8 992.2 1,006.7 II (15.5) - - - (15.5) $ 691.9 $ 300.1 $ 300.3 $ 1,003.9 $ 992.2 1 Indian River County, Florida Management's Discussion and Analysis For the Year Ended September 30, 2014 80 70 60 50 40 30 20 10 0 Revenues By Source (In Millions) Governmental Activities Fiscal Years 2013 and 2014 I LJ °�� o�� tea+ .a+ Or ` eco Jae c., rac�ey� ������ \�a�0c Qc a\eha�a �ac C. Qeca OaQ 5 O FY 2013 ❑ FY 2014 Governmental Activities • Overall program revenues increased $0.9 million. 1) Charges for services increase of $4.8 million or 26% was offset by a $4.7 million or 17% decrease in operating grants and contributions. In fiscal year 2014, $2.3 million in court revenues distributed to the Clerk were reported as charges for services but had been reported as operating grants and contributions in prior fiscal years. 2) The remaining $2.5 million increase in charges for services was mainly the result of: a) ambulance services revenues recorded as a receivable based on generally accepted accounting principles guidance ($1.0 million) and b) an increase in impact fee collections ($1.1 million). 3) Capital grants and contributions increased $0.8 million due to the reimbursement from FEMA for a hurricane -related beach project. • Overall general revenues increased by $6.6 million mainly due to increased property tax values and tax rates (increase of $5.7 million or 9%) and an increase in sales taxes ($0.9 million or 4%). 11 Indian River County, Florida Management's Discussion and Analysis For the Year Ended September 30, 2014 80 70 60 50 40 30 20 10 0 Expenditures By Function (In Millions) Governmental Activities Fiscal Years 2013 and 2014 EOM rn ❑ c�e�Na,,e, �ec� a�`oo �ec� �• ``eh a``or `��ea 1 c cy oc �` so 5e `ce ce ¢+Q ca\�o�e QJ�\\ a�eo;\` �`a�hQo ``ec,�c o�ac �Jco e `oJ� �e�eh� vete ray�o oos `�� �o Q �5,o D FY 2013 D FY 2014 • The governmental activities expenses were $4.0 million lower in 2014 than in 2013. Major decreases included: $2.7 million in transportation expenses mainly due to the completion of road projects such as 53rd Street and the 66th Avenue road construction project, $2.8 million in culture and recreation due to the prior year write off of a portion of a beach restoration project due to its asset impairment caused by Hurricane Sandy, and $1.4 million in economic environment expenses related to the Neighborhood Stabilization grant programs. These decreases were offset by a $2.4 million increase in general government expenses mainly due to increased commissions to the Property Appraiser and Tax Collector related to the tax roll ($1.1 million) and an increase in the overall allocated internal service funds loss ($0.5 million). Budget reductions resulted in an overall net decrease of $0.5 million in public safety, physical environment, human services, court related, and interest expenses. Business -type Activities Business -type activities net position decreased by $0.2 million. Key elements of this decrease are as follows: • Overall expenses were $2.7 million or 6% higher in 2014 than in 2013. The water and sewer utilities expenses were $2.0 million or 3% higher in 2014 than in 2013 due an increase in renewal and replacement costs. The solid waste expenses were $0.4 million or 4% higher in 2014 than in 2013 due to increased engineering and depreciation costs. The golf course had $0.1 million or 4% higher expenses in 2014 than in 2013 due to maintenance projects completed during the fiscal year. The building department had $0.2 million or 13% higher expenses in 2014 than in 2013 due to staffing increases. 12 Indian River County, Florida Management's Discussion and Analysis For the Year Ended September 30, 2014 ® Overall program revenues increased $2.0 million. 1) Charges for services increased by $1.7 million or 4%. A gradual improvement in the local economy has attributed to the following increases over 2013 revenues: water and sewer charges increased by $1.0 million or 3%, solid waste revenues increased $0.3 million or 3%, and the building revenues increased by $0.4 million or 20%. 2) Capital grants and contributions were $0.3 million higher in 2014 than in 2013, an overall increase of 6% due to water and sewer developer contributions. • Interest earnings decreased by $0.2 million or 28% from the preceding year due to lower interest rates. FINANCIAL ANALYSIS OF THE GOVERNMENT'S FUNDS As noted earlier, the County uses fund accounting to ensure and demonstrate compliance with finance related legal requirements. Governmental funds Unassigned fund balance may serve as a useful measure of the County's net resources available for spending at the end of the fiscal year. Approximately 28% of this total amount ($48.1 million) constitutes unassigned fund balance, which is available for spending at the County's discretion. The remainder of fund balance is presented in classifications that comprise a hierarchy based primarily on the extent to which the County is bound to honor constraints on the specific purposes for which amounts in those funds can be spent. The County had fund balance in 1) a nonspendable category for inventories, prepaid items, and advances to other funds ($1.1 million), 2) a restricted category for resources that are either restricted externally by creditors, grantors, contributors, or laws or regulations of other governments or imposed by law through constitutional provisions or enabling legislation ($113.3 million), 3) a committed category for constraints imposed by approval of ordinances and contracts by Board of County Commissioners ($2.7 million), and 4) an assigned category for constraints by the County's intent to use for specific purposes ($8.2 million). The two largest restricted amounts are in the Impact Fees Fund with a $15.1 million restricted fund balance and the Optional Sales Tax Fund with a $54.0 million restricted fund balance. Fifty-eight percent of the Impact Fees Fund ($8.7 million) and thirty-eight percent ($20.5 million) of the Optional Sales Tax Fund is slated for major road expansions throughout the County. The County's governmental funds reported a combined fund balance of $173.4 million, which is an increase of $0.8 million over the prior year of $172.6 million. Contributing factors to the $0.8 million increase in fund balance are: a Fund balance in the General Fund increased by $1.8 million. This increase was mainly due to the increased property taxes and reduced transfers due to the payoff of a portion of the Spring Training Bonds in the prior year. 13 Indian River County, Florida Management's Discussion and Analysis For the Year Ended September 30, 2014 • In the Impact Fees Fund, fund balance decreased $1.9 million. This was largely due to the $4.3 million in transportation spending for major road construction and right-of-way purchases. • Fund balance in the Optional Sales Tax Fund increased by $1.6 million due to capital transportation grant reimbursements. • Near completion of the CDBG Neighborhood Stabilization Program (nonmajor fund) resulted in a $1.0 million decrease in expenditures. Proprietary funds Unrestricted net position at the end of the year amounted to $12.9 million in the Solid Waste Disposal District (SWDD) Fund, ($1.8) million in the Golf Course Fund, $5.2 million in the County Building Fund, and $72.2 million in the County Utilities Fund. Other factors concerning the finances of these funds have already been addressed in the discussion of the County's business -type activities. GENERAL FUND BUDGETARY HIGHLIGHTS During the year there was a $6.8 million increase in operating appropriations between the original and final amended budget. The main components of the increase are as follows: • $3.2 million grants appropriations and prior year rollovers for the Senior Resource Association (SRA) to provide County -wide public transportation. • $0.8 million public safety vehicles and $0.3 million various operating accounts • $0.4 million in various legal and consulting fees • $0.2 million in local jobs grants and economic development studies • $0.6 million renovations and computers at the three libraries, various parks, the shooting range and the fairgrounds • $0.3 million cost of living increases Actual revenues were $4.5 million higher than the final budget for the following reasons: • $1.0 million refund of prior period expenses • $1.0 million increase in water sewer, electric, gas, and solid waste franchise fees • $1.7 million additional funds received for SRA public transportation • $0.5 million additional sales taxes and state revenue sharing Actual expenditures were $2.7 million lower than anticipated for the following reasons: • $0.5 million lower than expected Department of Juvenile Justice and Medicaid expenses 14 Indian River County, Florida Management's Discussion and Analysis For the Year Ended September 30, 2014 • $0.2 million lower than expected Sheriff expenses • $0.7 million in unspent legal and consulting services expenditures • $0.3 million in unspent libraries, parks, and shooting range renovations The General Fund Statement of Revenues, Expenditures, and Changes in Fund Balances - Budget and Actual is shown on page 31. CAPITAL ASSETS AND DEBT ADMINISTRATION Capital Assets The County's investment in capital assets for its governmental and business -type activities as of September 30, 2014, amounts to $798.0 million (net of accumulated depreciation). This investment in capital assets includes land, right-of-way, buildings and improvements, intangibles, equipment, infrastructure and construction in progress. The overall decrease in the County's investment in capital assets for the current fiscal year was less than 1%. Land Right-of-way Buildings and improvements Equipment Intangibles Infrastructure Construction in progress Total Indian River County Capital Assets (Net of Depreciation, In Millions) Governmental Business -type Activities Activities Total 2014 2013 2014 2013 2014 2013 $ 133.3 $ 140.7 $ 27.5 $ 27.3 $ 160.8 $ 168.0 56.8 55.7 - 56.8 55.7 151.4 143.0 205.8 207.2 357.2 350.2 12.7 12.1 2.4 1.6 15.1 13.7 2.4 1.4 1.9 1.8 4.3 3.2 149.0 150.9 - - 149.0 150.9 43.5 36.9 11.3 13.4 54.8 50.3 $ 549.1 $ 540.7 $ 248.9 $ 251.3 $ 798.0 $ 792.0 Governmental activities had the following major increases during the fiscal year: • An increase in construction in progress primarily due to the following continuing project costs: Osprey Marsh ($2.3 million), the 66th Avenue road expansion project from SR60 to 49th Street ($9.9 million), the 12th Street/ 27th Avenue intersection project ($1.5 million), and the Oslo Road expansion project from 43rd Avenue to 58th Avenue ($1.5 million). The decrease in land was due to the transfer of assets previously reported in the land category to the buildings and improvements category. 15 Indian River County, Florida Management's Discussion and Analysis For the Year Ended September 30, 2014 2% 1% Capital Assets, Net Total Primary Government September 30, 2014 o Land ■ Right of Way ❑ Buildings and Improvements 0 Equipment o Intangibles o Infrastructure ❑ Construction In Progress Additional information on the County's capital assets can be found in Note 6 on pages 70-72 of this report. Debt Administration — Long-term debt At the end of the current fiscal year, the County had total bonded debt outstanding of $73.7 million. Of this amount, $26.6 million is debt backed by the full faith and credit of the government. The revenue bonds represent bonds secured solely by specified revenue sources. Indian River County's Outstanding Debt General Obligation and Revenue Bonds (In Millions) Governmental Business -type Activities Activities Total General Obligation Debt: 2014 2013 2014 2013 2014 2013 Limited General Oblig., Series 2006 $ 26.6 $ 30.0 $ - $ - $ 26.6 $ 30.0 Revenue Bonds: Spring Training Facility, Series 2001 7.7 8.1 - - 7.7 8.1 Water and Sewer Ref. Rev., Series 2005 - 16.3 18.0 16.3 18.0 Water and Sewer Ref. Rev., Series 2009 23.1 25.0 23.1 25.0 Total $ 34.3 $ 38.1 $ 39.4 $ 43.0 $ 73.7 $ 81.1 Additional information on the County's long-term debt can be found in Note 13 on pages 77-85 of this report. 16 Indian River County, Florida Management's Discussion and Analysis For the Year Ended September 30, 2014 ECONOMIC FACTORS AND NEXT YEAR'S BUDGETS AND RATES The County tax roll is increasing by approximately 4.5% from last year. This follows a slight increase last year, after several years of decline in the wake of the "Great Recession". During this time period, many County revenues declined such as: sales taxes, gas taxes, interest earnings, and user fees. Additionally, ad valorem revenues were cut by over $33 million due to a 31% decline in the taxroll. Based upon Board direction, millage rates were essentially flat in an effort to reduce the tax burden on taxpayers already struggling through a difficult economy. In order to achieve the necessary cuts in expenditures, all efforts were made to improve the efficiency of the organization. The County explored and enacted privatizations, re -negotiated existing contracts, paid down debt, and reduced staffing levels by about 27%. These measures resulted in a leaner, more efficient organization that is better prepared to provide services to the public at a reduced cost going forward. In addition to the changes mentioned above, however, some temporary measures were needed to maintain the lower tax levies, such as the moderate use of fund balance and delayed replacement of capital items. As discussed in last year's budget message, the County began a two-year phase-out of fund balance usage. This plan will be completed in the proposed budget, which is fully balanced without the planned usage of fund balance in any taxing funds. The FY 2014/2015 budget also includes a substantial increase in funding for replacement capital items such as vehicles and heavy equipment. During the last few years, capital replacement was delayed wherever feasible. At this time, staff recommends that the County return to a sustainable replacement schedule for necessary capital equipment to provide essential services. These two proposals ensure that the County is adopting a structurally blended budget that will help maintain the long-term financial health of the County. The increase in the tax roll for the next year provides approximately $3.3 million in additional revenues. These funds have allowed for increased capital replacement funding and ending the use of fund balance as mentioned above. Staff recommends funding these changes prior to committing to additional operating expenditures. The total proposed budget for FY 2014/2015 is $260,379,973, a decrease of $42,838,568 or 14.1% from the prior year. This represents a drop of 44.9% from the approved FY 2006/2007 amount of $472,420,328. The General Fund millage rate is increasing slightly primarily due to a funding increase for the Sheriff and the phase-out of fund balance usage. The M.S.T.0 Fund and Emergency Services District millage rates remain the same as the current year and the Land Acquisition Fund millage is decreasing slightly. After accounting for the ad valorem increases proposed, the County's total ad valorem taxes are still down about $24 million since FY 2006/2007 (from $103.3 million to $79.5 million). The single greatest individual expense in the budget is Personnel Services. In total, eight (8) additional full-time (FT) positions are proposed for FY 14/15. BCC departments are increasing by seven (7) full- time positions, while Constitutional Officers show a net increase of one (1) position. This results in an additional cost of $369,130 (BCC only). Many of these positions are being added to keep pace with increasing development. Four (4) out of the seven (7) BCC positions are in non -taxing funds. 17 Indian River County, Florida Management's Discussion and Analysis For the Year Ended September 30, 2014 REQUESTS FOR INFORMATION This financial report is designed to provide a general overview of the County's finances for all those with an interest in the government's finances. Questions concerning any of the information provided in this report or requests for additional financial information should be addressed to: Clerk of the Circuit Court and Comptroller Attention: Finance Department 1801 27th Street Vero Beach, FL 32960 18 19 MSS MS Mg ME ME MS ISM Ea ISIS Min CMS ISIII ME3 O N Indian River County, Florida Statement of Net Position September 30, 2014 Primary Government Governmental Business -type activities activities Total ASSETS Current assets: Cash and cash equivalents $ 198,790,613 S 52,339,853 S 251,130,466 Investments 881,718 - 881,718 Accounts receivable - net 2,176,099 2,506,038 4,682,137 Internal balances 1,652,820 (1,652,820) Due from other govemments 9,165,403 10,800 9,176,203 Interest receivable 257,930 537,209 795,139 Inventories 312,690 954,570 1,267,260 Prepaid expenses 1,323,837 162,204 1,486,041 Current restricted assets: Cash and cash equivalents 5,438,408 46,938,672 52,377,080 Total current assets 219,999,518 101,796,526 321,796,044 Non-current assets: Net other post employment benefits asset 795,367 - 795,367 Capital assets - non -depreciable 238,147,481 40,309,436 278,456,917 Capital assets - depreciable 592,527,772 445,697,937 1,038,225,709 ' Capital assets - accumulated depreciation (281,571,672) (237,159,092) (518,730,764) Non-current restricted assets: Special assessments receivable 236,705 692,133 928,838 Impact fees receivable - 1,098,237 1,098,237 Liens receivable 3,902,046 3,902,046 Total non-current assets 550,135,653 254,540,697 804,676,350 Total assets 770,135,171 356,337,223 1,126,472,394 DEFERRED OUTFLOWS OF RESOURCES Deferred amounts on refundings Total deferred outflows of resources 2,245,798 2,245,798 2,245,798 2,245,798 LIABILITIES Current liabilities (payable from current assets): Accounts payable 7,401,313 2,981,562 10,382,875 Retainage payable - 505,733 505,733 Claims payable 3,181,891 - 3,181,891 Due to other governments 720,428 24,935 745,363 Other deposits held in escrow 69,509 1,000 70,509 Unearned revenues 341,400 32,771 374,171 Accrued compensated absences 5,682,955 586,624 6,269,579 Pollution remediation costs payable 114,480 5,500 119,980 Current liabilities (payable from current restricted assets): Accounts payable - 23,398 23,398 Retainage payable 1,277,230 31,410 1,303,640 Accrued interest payable 301,178 150.288 451,466 Customer deposits - 2,942,511 2,942,511 Bonds payable 3,860,000 3,485,000 7,345,000 Total current liabilities 22,950,384 10,770,732 33,721,116 Non-current liabilities Accrued compensated absences 4,945,665 266,933 5,212,598 Pollution remediation costs payable 2,557,320 6,000 2,563,320 Claims payable 5,044,654 - 5,044,654 Due to other governments 316,173 - 316,173 Closure and maintenance costs payable 11,509,736 11,509,736 Bonds payable, net of premium and discount 30,479,265 35,948,889 66,428,154 Total non-current liabilities 43,343,077 47,731,558 91,074,635 Total liabilities 66,293,461 58,502,290 124.795,751 NET POSITION Net investment in capital assets Restricted for- Transportation/road projects Public safety Court related costs Housing assistance Capital projects Beach renourishment Culture/recreation Debt service Environmental conservation/preservation Special assessment projects Unrestricted Total net position 514 764,316 23,710,353 15,903,712 3,119,193 1,055,724 54,795,400 6.313,199 7,038,407 2,255,094 160,855 1,851,890 72.873,567 211,660,190 726,424,506 88,420,541 23 710,353 15,903,712 3,119,193 1,055,724 54,795,400 6,313,199 7,038,407 2,255 094 160,855 1,851,890 161,294,108 703,841,710 S 300,080,731 S 1.003,922,441 The accompanying notes are an integral part of the financial statements. -1 ME MEP N N Indian River County, Florida Statement of Activities For the Year Ended September 30, 2014 Program Revenues Net (Expense) Revenue and Changes in Net Position Primary Government Operating Capital Charges for Grants and Grants and Governmental Business -type Functions/Programs Expenses Services Contributions Contributions Activities Activities Total Primary government: Governmental activities: General government S 22,968,835 S 5,895,424 $ 12,890,813 $ 21,200 S (4,161,398) S S (4,161,398) Public safety 66,954,956 8,025,849 1,189,325 (57,739,782) (57,739,782) Physical environment 1,031,710 20,970 51,222 162,850 (796,668) (796,668) Transportation 23,577,720 3,365,961 3,378,131 6,346,547 (10,487,081) (10,487,081) Economic environment 1,084,204 - 656,727 (427,477) (427,477) Human services 7,136,042 211,294 3,387,46237,286 (',-5 ) (3,537,286) Culture/recreation 16,610,269 1,883,347 406,798 990,941 (13,329,183) (13,329,183) Court related 6,360,814 3,592,298 268,776 - (2,499,740) (2,499,740) Interest and fiscal charges 1,944,229 - - (1,944,229) (1,944,229) Total governmental activities 147,668,779 22,995,143 22,229,254 7,521,538 (94,922,844) (94,922,844) Business -type activities: Water and sewer 35,821,287 29,565,901 5,014,715 (1,240,671) (1,240,671) Solid waste 10,801,408 10,272,415 17,327 (511,666) (511,666) Golf course 2,588,424 3,080,960 - 492,536 492,536 Building 1,833,528 2,417,724 584,196 584,196 Total business -type activities Total Primary Govemment 51,044,647 45,337,000 5,032,042 (675,605) (675,605) $ 198,713,426 S 68,332,143 S 22,229,254 $ 12,553,580 (94,922,844) (675,605) (95,598,449) General revenues: Property taxes, levied for general purposes 67,985,321 - 67,985,321 Property taxes, levied for debt service 4,730,556 - 4,730,556 Sales and use taxes 21,860,958 21,860,958 Franchise fees, levied on gross receipts 9,310,711 - 9,310,711 Interest earnings 542,542 381,497 924,039 Miscellaneous 2,459,033 331 2,459,364 Transfers (44,000) 44,000 - Total general revenues and transfers 106,845,121 425,828 107,270,949 Change in net position 11,922,277 (249,777) 11,672,500 Net position - beginning, as restated (Note 21B) 691,919,433 300,330,508 992,249,941 Net position - ending $ 703,841,710 S 300.080,731 S 1,003,922,441 The accompanying notes are an integral part of the financial statements. ASSETS Cash and cash equivalents Investments Accounts receivable Special assessments receivable Due from other funds Due from other governments Interest receivable Inventories Prepaid items Advances to other funds Total assets Indian River County, Florida Balance Sheet Governmental Funds September 30, 2014 General Impact Fees $ 50,083,681 $ 881,718 801,924 1,146,551 2,205,776 16,046 103,234 154,375 877,237 Secondary Roads Construction 16,667,610 $ 821,626 4,400 $ 56,270,542 $ 13,876,764 352,425 3,577 17,493,636 $ LIABILITIES Accounts payable $ 3,069,147 $ Retainage payable Due to other funds 384,660 Due to other governments 552,172 Unearned revenues 308,973 Other deposits 29,215 Total liabilities 4,344,167 DEFERRED INFLOWS OF RESOURCES Unavailable revenue - special assessments Unavailable revenue - ambulance services Unavailable revenue - state and federal grants Total deferred inflows ofresources 247,510 247,510 FUND BALANCES Nonspendable: Inventories Prepaid items Advances to other funds Restricted for: Transportation/road improvements Court -related costs and improvements Housing assistance Law enforcement/public safety Fire/emergency services Tourism -related activities Beach renourishment Boating related projects Library services Land acquisition Stormwater, street lighting, and other special assessments Voting/election activities Debt service Capital projects Dodgertown repairs/improvements Solid waste projects Parks/recreational projects Committed to: Economic incentives Environmental conservation/preservation Law Enforcement/public safety Parks/recreational projects Assigned to: Law enforcement/public safety Transportation/road improvements Unassigned Total fund balances Total liabilities, deferred inflows and fund balances $ The accompanying notes are 103,234 154,375 877,237 1,000,000 1,195,907 3,501 23,775 48,320,836 51,678,865 14,232,766 1,327,925 $ 275,248 1,603,173 769,770 769,770 8,708,193 593,856 925,074 880,856 764,673 24,990 3,223,051 15,120,693 56,270,542 $ 543,293 58,951 602,244 13,630,522 13,630,522 17,493,636 $ an integral part of the financial statements. 24 14,232,766 Transportation Emergency Optional Other Total Services Sales Governmental Governmental District Tax Funds Funds $ 8,252,215 $ 9,972,157 $ 50.764,237 $ 22,132;501 $ 171,749,165 - - 881,718 3,440 1,022,872 23,410 1,851,646 236,705 - - 236,705 224,758 12,525 56,313 1,440,147 265,728 12,365 4,824,189 615,016 9,097,125 147,363 2,812 13,714 4,632 192,544 - 19,688 122,922 19,649 174,024 - 877,237 $ 8,905,451 $ 11,234,964 $ 55,614,665 $ 22,871,209 $ 186,623,233 483,924 $ 650,268 $ 452,272 $ 646,395 $ 7,173,224 1,740 838,915 102,376 1,277,230 - - 274,500 659,160 - 10,169 562,341 1,636 14,633 16,158 341,400 - - 40,294 69,509 487,300 664,901 1.291.187 1.089.892 10.082.864 382.066- - 382,066 - 1,022,807 - 1.022.807 317,741 384,915 1,719,936 382,066 1,022,807 317,741 384,915 3,124,809 19,688 122,922 19.649 174.024 877.237 22,338,715 3.107.277 3.107.277 1,055,191 1,055,191 3,305,261 3,899,117 9,547,256 - 10,472,330 333.232 333.232 6,036.795 6,036,795 1,211,506 1.211,506 44,716 925,572 160,855 160,855 1,851,890 1,851,890 2.352 2.352 2.556.272 2,556.272 54,005.737 - 54,770,410 296,766 296,766 24,990 4.223.051 1.195.907 1.132.735 1,132.735 360 194 363,695 23,775 - - 103.610 103,610 8,036,085 - 8,036,085 - (201_587) 48,119,249 8.036.085 9,547,256 54,005,737 21,396,402 173,415,560 $ 8,905,451 $ 11,234,964 $ 55,614,665 $ 22,871.209 $ 186,623,233 25 Indian River County, Florida Reconciliation of Total Governmental Fund Balances to Net Position of Governmental Activities September 30, 2014 Total governmental fund balances: $ 173,415,560 Amounts reported for governmental activities in the statement of net position are different because: Capital assets used in governmental activities are not financial resources and, therefore, are not reported 548,719,042 in the fund. Long-term liabilities, including bonds payable ($34,339,265), accrued compensated absences ($10,523,367), medicaid settlement funds payable ($474,260) and accrued pollution remediation costs ($2,671,800) are not due and payable in the current period and, therefore, are not reported in the fund. (48,008,692) Accrued general long-term debt interest expenses are not financial uses and, therefore, are not reported in (301,178) the fund. Special assessment, ambulance services, and state and federal grant receivables are not available to pay for current period expenditures and, therefore, are reported as unavailable revenue in the funds. 3,124,809 Accrued interest is not recognized in the current period because the resources are not available and, therefore, not reported in the fund. 48,675 Internal service funds are used by management to charge the costs of certain activities, such as insurance, fleet, and information technology services, to individual funds. The assets and liabilities of the internal service funds are included in governmental activities in the statement of net position. 26,048,127 The OPEB asset resulting from contributions in excess of the annual required contribution is not a financial resource and, therefore, is not reported in the funds. 795,367 Net position of governmental activities $ 703,841,710 The accompanying notes are an integral part of the financial statements. 26 IIIIII ® ® ® ® NM 1111111 Mil ® ® WE ® ® ® ® N NMI Mil NMI 1 Indian River County, Florida Statement of Revenues, Expenditures, and Changes in Fund Balances Governmental Funds For the Year Ended September 30, 2014 1 Secondary Impact Roads General Fees Construction REVENUES Taxes $ 49,346,756 $ - $ 3,294,709 Permits, fees and special assessments 9,528,916 4,218,105 100,964 Intergovernmental 16,514,498 13,422 1,122,393 Charges for services 10,940,954 - - Judgments, fines and forfeits 459,812 - Interest 197,947 7,320 31,566 Miscellaneous 2,187,650 190,519 111,612 Total revenues 89,176,533 4,429,366 4,661,244 EXPENDITURES Current: General government 18,686,324 689,176 Public safety 40,455,836 534,699 Physical environment 261,593 Transportation 4,031,930 4,268,358 4,399,329 Economic environment 404,504 - Human services 3,494,670 - Culture/recreation 8,172,881 681,144 - I Court related 5,737,238 - - Debt service Principal Interest and fiscal charges - I Capital projects Total expenditures 81,244,976 6,173,377 4,399,329 Excess of revenues over (under) expenditures 7,931,557 (1,744,011) 261,915 OTHER FINANCING SOURCES (USES) Transfers in 1,704,663 258,613 Transfers out (7,837,943) (151,416) - Total other financing sources (uses) (6,133,280) (151,416) 258,613 Net change in fund balances 1,798,277 (1,895,427) 520,528 I Fund balances at beginning of year 49,880,588 17,016,120 13,109,994 Fund balances at end of year $ 51,678,865 $ 15,120,693 $ 13,630,522 1 1 1 1 1 The accompanying notes are an integral part of the financial statements. 28 Transportation Emergency Optional Other Total Services Sales Governmental Governmental District Tax Funds Funds $ - $ 20,064,393 $ 15,228,304 $ 6,651,183 $ 94,585,345 131,486 50,482 291,436 14,321,389 2,796,760 82,765 3,689,417 6,344,395 30,563,650 102,237 5,480,257 1,553,440 18,076,888 - 11,000 533,562 1,004,374 32,346 37,085 109,649 47,361 463,274 410,768 20,547 63,080 237,372 3,221,548 3,473,597 25,696,047 19,140,932 15,658,749 162,236,468 287,856 - 1,018,214 20,681,570 25,103,305 1,705,827 67,799,667 408,339 - 111,374 781,306 10,375,143 246,488 23,321,248 702,382 1,106,886 3,683,872 7,178,542 2,773,261 11,627,286 - 750,668 6,487,906 3,700.000 3,700,000 - 1,984,616 1,984,616 16.560,991 - 16,560,991 11.071.338 25,103,305 16,560,991 16,676,702 161,230,018 (7,597,741) 592,742 2,579,941 (1,017.953) 1,006,450 7,657,704 471,664 10,092,644 (383,613) (428,081) (1,018,067) (425,860) (10,244,980) 7,274,091 (428,081) (1,018,067) 45,804 (152,336) (323,650) 164,661 1,561,874 (972,149) 854,114 8,359,735 9,382.595 52,443,863 22,368,551 172,561,446 $ 8,036.085 $ 9,547.256 $ 54.005.737 $ 21.396;402 $ 173;415,560 29 Indian River County, Florida Reconciliation of the Statement of Revenues, Expenditures, and Changes in Fund Balances of Governmental Funds to the Statement of Activities For the Year Ended September 30, 2014 Net change in fund balances - total governmental funds Amounts reported for governmental activities in the statement of activities are different because: Governmental funds report capital outlay as expenditures. However, in the statement of activities, the cost of those assets is allocated over their estimated useful lives as depreciation expense. Expenditures for capital assets 27,952,771 Less current year loss on assets (45,603) Less current year depreciation (19,715,820) $ 854,114 8,191,348 Payments of bond principal, pollution remediation, and medicaid settlement costs are expenditures in the governmental funds, but the payment reduces long-term liabilities in the statement of net position. Bond principal payment 3,700,000 Bond premium payment 93,224 Medicaid settlement 158,082 Pollution remediation costs 55,600 4,006,906 Changes in accrued compensated absences do not require the use of current financial resources and, therefore, are not reported as expenditures in governmental funds. 727,555 Governmental funds report interest and OPEB expenditures based on when they are paid. The statement of activities reports these expenses as they are incurred. This is the net number of the prior year and current year accrual. Accrued bond interest expense Accrued OPEB expense Some revenues reported in the governmental funds have been recognized as revenues in the prior fiscal year in the statement of activities. Internal service funds are used by management to charge the costs of insurance, fleet and information technology services to individual funds. The net costs of the internal service funds are reported in governmental activities. Governmental funds report non-exchange transactions when the applicable eligibility requirements have been met and resources are available. However, in the statement of activities, non-exchange transactions are recognized when the eligibility requirements are met. This is the net number of the prior year and current year accrual. Some interest revenues reported in the statement of activities do not provide current financial resources, therefore, are not reported as revenues in governmental funds. This is the net number of the prior year and current year accrual. 40,387 494,761 535,148 (8,510) (1,964,753) (423,777) 4,246 Change in net position of governmental activities $ 11,922,277 The accompanying notes are an integral part of the financial statements. 30 Indian River County, Florida Statement of Revenues, Expenditures, and Changes in Fund Balances - Budget and Actual General Fund For the Year Ended September 30, 2014 REVENUES Taxes Permits, fees and special assessments Intergovernmental Charges for services Judgments, fines and forfeits Interest Miscellaneous Total revenues EXPENDITURES Current: General government Public safety Physical environment Transportation Economic environment Human services Culture/recreation Court related Total expenditures Excess of revenues over (under) expenditures OTHER FINANCING SOURCES (USES) Transfers in Transfers out Total other financing sources (uses) Net change in fund balances Fund balances at beginning of year Fund balances at end of year Budgeted Amounts Original Final Actual Amounts $ 48,473,970 $ 8,468,300 10,969,824 11,940,585 317,300 246,000 946,059 48,473,970 $ 8,468,300 14,359,497 11,605,506 317,300 246,000 1,161,211 49,346,756 $ 9,528,916 16,514,498 10,940,954 459,812 197,947 2,187,650 Variance with Final Budget Positive (Negative) 872,786 1,060,616 2,155,001 (664,552) 142,512 (48,053) 1,026,439 81,362,038 84,631,784 89,176,533 4,544,749 18,338,853 19,461,566 18,686,324 775,242 39,770,445 41,086,202 40,455,836 630,366 242,182 278,441 261,593 16,848 932,311 4,201,571 4,031,930 169,641 372,021 414,756 404,504 10,252 3,830,419 3,930,475 3,494,670 435,805 7,981,284 8,803,952 8,172,881 631,071 5,641,921 5,782,074 5,737,238 44,836 77,109,436 83,959,037 81,244,976 2,714,061 4,252,602 672,747 7,931,557 7,258,810 198,004 1,730,420 1,704,663 (25,757) (7,810,564) (7,843,307) (7,837,943) 5,364 (7,612,560) (6,112,887) (6,133,280) (20,393) (3,359,958) (5,440,140) 1,798,277 $ 7,238,417 3,359,958 5,440,140 49,880,588 $ $ - $ 51,678,865 The accompanying notes are an integral part of the financial statements. 31 Indian River County, Florida Statement of Revenues, Expenditures, and Changes in Fund Balances - Budget and Actual Impact Fees Fund For the Year Ended September 30, 2014 REVENUES Permits, fees and special assessments Intergovernmental Interest Miscellaneous Total revenues EXPENDITURES Current: General government Public safety Physical environment Transportation Culture/recreation Total expenditures Excess of revenues under expenditures OTHER FINANCING SOURCES (USES) Transfers out Total other financing sources (uses) Net change in fund balances Fund balances at beginning of year Fund balances at end of year Budgeted Amounts Original Final Actual Amounts $ 2,162,200 117,750 325 $ 2,162,200 284,338 117,750 325 Variance with Final Budget Positive (Negative) $ 4,218,105 $ 2,055,905 13,422 (270,916) 7,320 (110,430) 190,519 190,194 2,280,275 2,564,613 4,429,366 1,864,753 712,620 190,000 26,000 1,721,220 656,455 860,463 1,754,979 26,000 11,193,103 3,824,396 689,176 534,699 4,268,358 681,144 171,287 1,220,280 26,000 6,924,745 3,143,252 3,306,295 17,658,941 6,173,377 11,485,564 ( 1,026,020) (15,094,328) (151,417) (1,744,011) 13,350,317 (151,416) ( 1,026,020) (151,417) (15,245,745) (151,416) 1 1 (1,895,427) $ 13,350,318 1,026,020 15,245,745 17,016,120 $ - $ - $ 15,120,693 The accompanying notes are an integral part of the financial statements. 32 Indian River County, Florida Statement of Revenues, Expenditures, and Changes in Fund Balances - Budget and Actual Secondary Roads Construction Fund For the Year Ended September 30, 2014 REVENUES Taxes Permits, fees and special assessments Intergovernmental Interest Miscellaneous Total revenues EXPENDITURES Current: Transportation Total expenditures Excess of revenues over (under) expenditures OTHER FINANCING SOURCES (USES) Transfers in Total other financing sources (uses) Budgeted Amounts Original Final Actual Amounts $ 3,151,048 $ 38,000 976 3,151,048 $ 2,263,975 38,000 53,854 3,294,709 $ 100,964 1,122,393 31,566 111,612 Variance with Final Budget Positive (Negative) 143,661 100,964 (1,141,582) (6,434) 57,758 3,190,024 5,506,877 4,661,244 7,994,150 14,464,023 4,399,329 (845,633) 10,064,694 7,994,150 14,464,023 4,399,329 10,064,694 (4,804,126) (8,957,146) 261,915 275,000 258,613 9,219,061 (16,3 87) 275,000 258,613 Net change in fund balances (4,804,126) (8,682,146) 520,528 Fund balances at beginning of year 4,804,126 8,682,146 13,109,994 Fund balances at end of year $ $ - $ 13,630,522 The accompanying notes are an integral part of the financial statements. 33 (16,387) $ 9,202,674 Indian River County, Florida Statement of Revenues, Expenditures, and Changes in Fund Balances - Budget and Actual Transportation Fund For the Year Ended September 30, 2014 REVENUES Permits, fees and special assessments Intergovernmental Charges for services Interest Miscellaneous Total revenues EXPENDITURES Current: General government Physical environment Transportation Total expenditures Excess of revenues under expenditures OTHER FINANCING SOURCES (USES) Transfers in Transfers out Total other financing sources (uses) Net change in fund balances Fund balances at beginning of year Fund balances at end of year Budgeted Amounts Original Final Actual Amounts $ 123,500 $ 2,464,828 96,425 47,500 875,956 123,500 $ 2,464,828 96,425 47,500 879,037 131,486 $ 2,796,760 102,237 32,346 410,768 3,608,209 3,611,290 3,473,597 Variance with Final Budget Positive (Negative) 7,986 331,932 5,812 (15,154) (468,269) (137,693) 271,491 577,851 11,539,797 346,565 596,633 12,825,514 287,856 408,339 10,375,143 58,709 188,294 2,450,371 12,389,139 13,768,712 11,071,338 2,697,374 (8,780,930) (10,157,422) 7,657,704 7,657,704 (400,000) (7,597,741) 2,559,681 7,657,704 (383,613) 16,387 7,657,704 7,257,704 7,274,091 16,387 (1,123,226) (2,899,718) (323,650) $ 2,576,068 1,123,226 2,899,718 8,359,735 $ $ 8,036,085 The accompanying notes are an integral part of the financial statements. 34 Indian River County, Florida Statement of Revenues, Expenditures, and Changes in Fund Balances - Budget and Actual Emergency Services District Fund For the Year Ended September 30, 2014 REVENUES Taxes Intergovernmental Charges for services Judgments, fines and forfeits Interest Miscellaneous Total revenues EXPENDITURES Current: Public safety Total expenditures Excess of revenues over (under) expenditures OTHER FINANCING SOURCES (USES) Transfers out Total other financing sources (uses) Net change in fund balances Fund balances at beginning of year Fund balances at end of year Budgeted Amounts Original Final Actual Amounts $ 19,742,353 $ 42,750 4,666,226 2,850 73,625 122,371 19,742,353 $ 60,189 4,766,226 2,850 73,625 122,371 20,064,393 $ 82,765 5,480,257 11,000 37,085 20,547 24,650,175 24,767,614 25,696,047 Variance with Final Budget Positive (Negative) 322,040 22,576 714,031 8,150 (36,540) (101,824) 928,433 25,245,666 26,139,776 25,103,305 1,036,471 25,245,666 26,139,776 25,103,305 1,036,471 (595,491) (1,372,162) (425,395) (430,819) 592,742 1,964,904 (428,081) 2,738 (425,395) (430,819) (428,081) 2,738 (1,020,886) (1,802,981) 164,661 $ 1,967,642 1,020,886 1,802,981 9,382,595 $ - $ - $ 9,547,256 The accompanying notes are an integral part of the financial statements. 35 NEI mg ram INN Plal MN SIM MEI 1111111 NEI MIMI IMIN INN ME Sal ME Iffil MIN MI Indian River County, Florida Statement of Fund Net Position Proprietary Funds September 30, 2014 Business -type Activities - Enterprise funds Solid Waste Disposal Golf County County District Course Utilities Building Total Governmental Activities Internal Service Funds ASSETS Current assets: Cash and cash equivalents S 10,470,647 S 8,528 5 36,525,585 S 5,335,093 S 52,339,853 S 32,479,856 Accounts receivable - net 122,963 - 2,383,075 - 2,506,038 324,453 Due from other funds 89,468 - - 89,468 1,596 Due from other governments - 10,800 - - 10,800 68,278 Interest receivable 7,927 192 526,182 2,908 537,209 16,711 Inventories 57,791 896,779 - 954,570 189,768 Prepaid items 395 160,838 971 162,204 1,149,813 Current restricted assets: Cash and cash equivalents 14,796,093 32,142,579 46,938,672 Total current assets 25,487,098 77,706 72,635,038 5,338,972 103,538,814 34,230,475 Non-current assets: Capital assets - non -depreciable 13,359,177 7,774,283 19,175,976 - 40,309,436 Capital assets - depreciable 31,304,613 2,346,803 411,680,098 366,423 445,697,937 2,393,687 Capital assets - accumulated depreciation (10,458,217) (1,965,309) (224,405,359) (330,207) (237,159,092) (2,009,148) Non-current restricted assets: Special assessments receivable 692,133 692,133 Impact fees receivable - 1,098,237 1,098,237 Liens receivable 3,902,046 3,902,046 Total non-current assets 34,205,573 8,155,777 212,143,131 36,216 254,540,697 384,539 Total assets 59,692,671 8,233,483 284,778,169 5,375,188 358,079,511 34,615,014 DEFERRED OUTFLOWS OF RESOURCES Deferred amounts on refundings - 2,245,798 - 2,245,798 Total deferred outflows of resources 2,245,798 - 2,245,798 LIABILITIES Current liabilities (payable from current assets): Accounts payable 893,214 13,385 2,010 722 64,241 2,981,562 228,089 Retainage payable 58,400 447,333 505,733 Due to other funds 865,051 865,051 7,000 Claims payable - 3,181,891 Due to other governments 6,145 - 18,790 24,935 Other deposits 1,000 - 1,000 Unearned revenues - 32.771 32.771 Pollution remediation costs payable 5,500 5,500 - Accrued compensated absences 40.365 20,536 467,967 57,756 586,624 54,327 Total current liabilities (payable from current assets) 933,579 997,288 2.931.522 140,787 5,003,176 3,471,307 Current liabilities (payable from restricted assets): Accounts payable - 23,398 23,398 Retainage payable 31,410 31,410 Accrued interest payable 150,288 - 150,288 - Bonds payable 3,485,000 3,485,000 Customer deposits 133,626 2,808,885 2,942,511 Total current liabilities (payable from restricted assets) 133,626 6,498,981 6,632,607 Total current liabilities 1,067,205 997,288 9,430,503 140,787 11,635,783 3 471,307 Non-current liabilities: Accrued compensated absences 8,454 39,394 199 057 20,028 266,933 50,926 Advance from other funds - 877,237 - - 877,237 Claims payable - 5,044,654 Pollution remediation costs payable 6,000 - 6,000 Closure and maintenance costs payable 11,509,736 - - 11,509,736 Bonds payable - net of unamortized discount/premium - 35,948,889 35,948,889 Total non-current liabilities 11,518,190 916,631 36,153,946 20,028 48,608,795 5,095,580 Total liabilities 12,585,395 1.913,919 45,584,449 160,815 60,244,578 8,566,887 NET POSITION Net investment in capital assets 34.205.573 8,155,777 169262,624 36,216 211,660,190 384,539 Unrestricted 12,901,703 (1,836,213) 72,176,894 5,178,157 88,420,541 25,663,588 Total net position S 47 107,276 S 6,319.564 5 241,439.518 S 5.214,373 S 300,080,731 S 26,048.127 The accompanying notes are an integral pan of the financial statements 37 1 Indian River County, Florida Statement of Revenues, Expenses, and Changes in Fund Net Position Proprietary Funds For the Year Ended September 30, 2014 1 Business -type Activities -Ell Solid Waste Disposal Golf District Course OPERATING REVENUES Charges for services $ 10,272,415 $ 3,080,960 Charges for services pledged as security for revenue bonds - Total operating revenues 10,272,415 3,080,960 OPERATING EXPENSES11 Personal services 534,751 501,566 Material, supplies, services and other operating 9,337,279 1,833,079 Depreciation 929,378 208,949 Total operating expenses 10,801,408 2,543,594 Operating income (loss) (528,993) 537,366 NONOPERATING REVENUES (EXPENSES) Interest income 109,251 1,981 Interest income pledged as security for revenue bonds 3 Gain on disposal of equipment 330 Interest expense - (44,830) Bond amortization expense - Loss on disposal of equipment - Total nonoperating revenues (expenses) 109,251 (42,519) Income (loss) before transfers and capital grants and 1 contributions (419,742) 494,847 1 Capital grants Capital contributions 61,327 - Transfers (75,414) I - Change in net position (433,829) 494,847 Total net position - beginning 47,541,105 5,824,717 1 Total net position - ending $ 47,107,276 $ 6,319,564 1 1 a The accompanying notes are an integral part of the financial statements. 38 Enterprise Funds County County Utilities Building $ Total Governmental Activities - Internal Service Funds - $ 2,417,724 $ 15,771,099 $ 29,565,901 - 29,565,901 29,565,901 2,417,724 22,543,318 45,337,000 22,543,318 7,609,569 1,183,025 9,828,911 3,940,425 11,776,672 636,517 23,583,547 20,618,835 14,432,329 13,986 15,584,642 176,169 33,818,570 1,833,528 48,997,100 24,735,429 (4,252,669) 584,196 (3,660,100) (2,192,111) - 11,525 122,757 75,022 258,740 - 258,740 1 331 (1,929,183) (1,974,013) (24,209) (24,209) (49,325) - (49,325) (1,743,977) 11,526 (1,665,719) 75,022 (5,996,646) 595,722 (5,325,819) (2,117,089) 310,239 310,239 - 4,704,476 4,765,803 158,653 75,414 - 152.336 (906,517) 595,722 242,346,035 4,618,651 (249,777) (1,806,100) 300,330,508 27,854,227 $ 241,439,518 $ 5,214,373 $ 300,080,731 $ 26,048,127 Indian River County, Florida Statement of Cash Flows Proprietary Funds For the Year Ended September 30, 2014 Business -type Activities - Solid Waste Disposal District Golf Course 1 CASH FLOWS FROM OPERATING ACTIVITIES Cash received from customers $ 10,320,178 $ 3,083,187 I Cash paid to suppliers for goods and services (9,306,535) (1,865,212) Cash paid to employees for services (524,959) (493,774) Net cash provided by (used in) operating activities 488,684 724,201 CASH FLOWS FROM NONCAPITAL FINANCING ACTIVITIES Transfers - - Payments on advances from other funds (585,000) Net cash provided by (used in) noncapital financing activities (585,000) CASH FLOWS FROM CAPITAL AND RELATED FINANCING ACTIVITIES Principal payments - bonds/notes - Payments on advances from other funds (56,322) Proceeds from advances from other funds 630,000 Interest paid on long-term debt (43,527) Proceeds from sales of capital assets 330 Purchase of capital assets (216,891) (1,120,928) Bond paying agent fees (973) Capital contributed by others - - Net cash flows provided by (used in) capital and related financing activities (216,891) (591,420) CASH FLOWS FROM INVESTING ACTIVITIES Interest and dividends on investments 111,082 2,212 Net cash provided by investing activities 111,082 2,212 Net increase (decrease) in cash and cash equivalents 382,875 (450,007) Cash and cash equivalents at beginning of year 24,883,865 458,535 I Cash and cash equivalents at end of year $ 25,266,740 $ 8,528 Classified as: Current assets $ 10,470,647 $ 8,528 Restricted assets 14,796,093 - Total $ 25,266,740 $ 8,528 I 1 1 The accompanying notes are an integral part of the financial statements 40 1 Enterprise Funds County County Utilities Building Total Governmental Activities - Internal Service Funds $ 29,043,372 $ 2,417,724 $ 44,864,461 $ 22,395,656 (14,244,858) (612,392) (26,028,997) (20,294,226) (7,574,925) (1,196,328) (9,789,986) (3,888,999) 7,223,589 609,004 9,045,478 (1,787,569) (585,000) 152,336 (310,000) (585,000) (157,664) (3,350,000) (3,350,000) (56,322) 630,000 (1,937,449) - (1,980,976) 1 331 (10,031,448) (19,714) (11,388,981) (2,900) (3,873) 3,259,071 3,259,071 (188,656) (12,062,726) (19,713) (12,890,750) (188,656) 287,171 11,772 412,237 80,029 287,171 11,772 412,237 80,029 (4;551,966) 601,063 (4,018,035) (2,053,860) 73,220,130 4,734,030 103,296,560 34,533,716 $ 68,668,164 $ 5,335,093 $ 99,278,525 $ 32,479,856 $ 36,525,585 $ 5,335,093 $ 52,339,853 $ 32,479,856 32,142,579 - 46,938,672 $ 68,668,164 $ 5,335,093 $ 99,278,525 $ 32,479,856 Continued 41 1 Indian River County, Florida Statement of Cash Flows Proprietary Funds For the Year Ended September 30, 2014 Business -type Activities - I Solid Waste Disposal Golf District Course RECONCILIATION OF OPERATING INCOME (LOSS) TO NET CASH PROVIDED BY (USED IN) OPERATING ACTIVITIES: Operating income (loss) $ (528,993) $ 537,366 Adjustments to reconcile operating income to net cash I provided by (used in) operating activities: Depreciation 929,378 208,949 I WIP reclassified as expense (Increase) Decrease in assets. I Accounts receivable 33,694 Due from other funds 11,569 Due from other governments 200 I Inventories (2,708) Impact fees receivable - Special assessments receivable Liens receivable I Prepaid expenses 200 Increase (Decrease) in liabilities. I Accounts payable (467,256) (28,483) Due to other governments (1,142) Retainage payable Customer deposits 2,500 I Closure and maintenance costs payable 498,000 Pollution remediation costs payable Unearned revenues 2,027 I Claims payable Accrued compensated absences 9,792 7,792 Total adjustments 1,017,677 186,835 I Net cash provided by (used in) operating activities $ 488,684 $ 724,201 1 NONCASH CAPITAL AND RELATED FINANCING ACTIVITIES Change in fair value of investments $ 2,259 $ 55 Contributed property, infrastructure, and equipment $ 61,327 $ - Capital assets purchased through accounts payable $ 18,207 $ 1 1 The accompanying notes are an integral part of the financial statements. 1 42 Enterprise Funds County County Utilities Building Total Governmental Activities - Internal Service Funds $ (4,252,669) $ 584,196 $ (3,660,100) $ (2,192,111) 14,432,329 13,986 15,584,642 176,169 170,712 170,712 94,488 128,182 (190,221) 11,569 (1,595) 349,638 349,838 44,154 (47,874) (50,582) (12,808) (322,413) (322,413) 145,635 145,635 (746,494) (746,494) 57,719 (971) 56,948 76,210 129,110 21,610 (345,019) 108,662 (2,827,524) 3,486 (2,825,180) 48,671 48,671 (43,383) (40,883) 498,000 1,000 1,000 2,027 152,545 34,644 (13,303) 38,925 51,426 11,476,258 24,808 12,705,578 404,542 $ 7,223,589 $ 609,004 $ 9,045,478 $ (1,787,569) $ 9,482 $ 829 $ 12,625 $ S 1,755,644 $ - $ 1,816,971 $ $ 752,778 $ - $ 770,985 $ 4,764 158,653 Indian River County, Florida Statement of Fiduciary Net Position Fiduciary Funds September 30, 2014 Other Postemployment Agency Benefits Trust ASSETS Cash and cash equivalents $ 13,484,243 $ Investments, at fair value: Index funds - 6,983,499 U.S. government securities funds 5,860,758 Primary money market fund - 1,194,575 Total assets $ 13,484,243 $ 14,038,832 LIABILITIES Accounts payable $ 419,713 $ Due to other governments 4,644,941 Other deposits held in escrow 8,419,589 Total liabilities $ 13,484,243 NET POSITION Assets held in trust for other postemployment benefits 14,038,832 Total net position $ 14,038,832 The accompanying notes are an integral part of the financial statements. 44 Indian River County, Florida Statement of Changes in Fiduciary Net Position Other Post Employment Benefits Trust Fund For the Year Ended September 30, 2014 ADDITIONS Employer contributions $ 3,426,879 Investment income 765,759 Investment expense (1,440) Total additions 4,191,198 DEDUCTIONS Benefits payments Total deductions 1,724,334 1,724,334 Change in net position 2,466,864 Net position - beginning Net position - ending 11,571,968 $ 14,038,832 The accompanying notes are an integral part of the financial statements. 45 On EIRE MIN gall EMI ® 11111 EIM M ME KM MEI MEI Mal 11111 ME EMI MEI NMI Indian River County, Florida Notes To Financial Statements Year Ended September 30, 2014 Note 1 Summary of Significant Accounting Policies Reporting Entity Measurement Focus and Basis of Accounting Basis of Presentation Assets, Liabilities, Deferred Outflows/ Inflows of Resources, and Net Position or Fund Balances Cash and Cash Equivalents Investments Allowance for Doubtful Accounts Receivables and Payables Inventories Prepaid Items Restricted Net Position Capital Assets Capitalization of Interest Deferred Inflows/Outflows of Resources Unearned Revenues Accrued Compensated Absences Obligation for Bond Arbitrage Rebate Landfill Closure Costs Unamortized Bond Discounts and Premiums Capital Contributions 2 Reconciliation of Government -wide and Fund Financial Statements 3 Stewardship, Compliance and Accountability Budget and Budgetary Accounting 4 Cash and Cash Equivalents Deposits Accrued Interest Investments OPEB Trust Investments 5 Property Tax Revenues Page Note Pan 6 Capital Assets 70 48 7 Restricted Cash and Cash Equivalents 48 and Investments 8 Payable from Restricted Assets 49 9 Interfund Balances 52 10 Interfund Transfers 11 Due from Other Governments 12 Accounts Payable 54 13 Long-term Liabilities 54 Changes in Long-term Liabilities 54 Governmental Activities 55 Annual Debt Service Payments — 55 Governmental Activities 55 Limited General Obligation Bonds 55 Spring Training Facility Revenue 55 Bonds 56 Business -type Activities 57 Annual Debt Service Payments — Business -type Activities 57 Water and Sewer Revenue Refunding 57 Bonds, Series 2005 57 Water and Sewer Revenue Refunding Bonds, Series 2009 58 Compensated Absences 58 14 Provision for Closure Costs 15 Pollution Remediation 58 16 Pension Plans - 58 Florida Retirement System 17 Other Postemployment Benefits Plan 59 18 Operating Leases 19 Fund Balance 63 20 Fund Balance Deficit 63 21 Net Position 64 22 Risk Management 64 23 Commitments and Contingencies 64 Litigation 64 Contracts and Other 68 Commitments 69 Grants 24 Subsequent Events 47 73 73 74 75 76 76 77 77 78 78 79 79 82 82 83 84 85 85 87 88 90 93 95 97 97 98 99 99 99 100 100 Indian River County, Florida Notes To Financial Statements Year Ended September 30, 2014 NOTE 1— SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Indian River County, Florida, (the "County") is a political subdivision of the State pursuant to Article VIII, Section 1(a) of the Constitution of the State of Florida. Created on June 29, 1925 by an act of Legislature, separating it from St. Lucie County, the County encompasses approximately 497 square miles of land with an estimated population of 140,955. The County is governed by the Board of County Commissioners and five elected constitutional officers (Clerk of the Circuit Court and Comptroller, Property Appraiser, Sheriff, Supervisor of Elections, and Tax Collector) in accordance with state statutes and regulations. The constitutional officers maintain separate accounting records and budgets from the Board of County Commissioners. The Constitution of the State of Florida, Article VIII, Section 1(d) created the constitutional officers and Article VIII, Section 1(e), created the Board of County Commissioners. The financial statements of the County have been prepared in accordance with generally accepted accounting principles (GAAP) as applied to governmental units. The Governmental Accounting Standards Board (GASB) is the standard-setting body for governmental accounting and financial reporting. The County applies all GASB Pronouncements in the preparation of the financial statements of the enterprise funds as well as all FASB and AICPA Pronouncements. The GASB periodically updates its codification of the existing Governmental Accounting and Financial Reporting Standards which, along with subsequent GASB pronouncements (Statements and Interpretations), constitutes GAAP for governmental units: A. Reporting Entity The concept underlying the definition of the reporting entity is that elected officials are accountable to their constituents for their actions. The reporting entity's financial statements should allow users to distinguish between the primary government (the County) and its component units. However, some component units, because of the closeness of their relationships with the County, should be blended as though they are part of the County. Otherwise, most component units should be discretely presented. As required by generally accepted accounting principles, the financial reporting entity consists of: (1) the primary government (the County), (2) organizations for which the County is financially accountable, and (3) other organizations for which the nature and significance of their relationship with the County are such that exclusion would cause the reporting entity's financial statements to be misleading or incomplete. The County is financially accountable if it appoints a voting majority of the organization's governing body and (a) it is able to impose its will on that organization or (b) there is a potential for the organization to provide specific financial benefits to, or impose specific financial burdens on, the County. The County may be financially accountable if an organization is fiscally dependent on the County regardless of whether the organization has (a) a separately elected governing board, (b) a governing board appointed by a higher level of government, or. (c) a jointly appointed board. Based on these criteria, management determined that the Solid Waste Disposal District and the Emergency Services District were the only organizations that should be included in the County's financial statements as blended component units. 48 Indian River County, Florida Notes To Financial Statements Year Ended September 30, 2014 NOTE 1— SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES — Continued A. Reporting Entity — Continued Blended Component Units Solid Waste Disposal District (SWDD) — Created pursuant to County Ordinance 87-67, the Board of County Commissioners serves as the governing body for and has operational responsibility over the SWDD. The Board also sets the non ad valorem assessment fees for the SWDD. Although legally separate, the SWDD is appropriately blended as a proprietary fund type (enterprise) component unit into the primary government. Emergency Services District (EMS) — Created pursuant to County Ordinance 90-25, the Board of County Commissioners serves as the governing body for and has operational responsibility over the EMS. The Board also sets the millage rate for the EMS. Although legally separate, the EMS is appropriately blended as a governmental fund type (special revenue) component unit into the primary government. B. Measurement Focus and Basis of Accounting The basic financial statements of the County are composed of the following: • Government -wide financial statements • Fund financial statements e Notes to the financial statements 1. Government -wide Financial Statements Government -wide financial statements display information about the reporting government as a whole, except for its fiduciary activities. These statements include separate columns for the governmental and business -type activities of the primary government (including its blended component units). Governmental activities, which normally are supported by taxes and intergovernmental revenues, are reported separately from business -type activities, which rely, to a significant extent, on fees and charges for support. Government -wide financial statements are reported using the economic resources measurement focus and the accrual basis of accounting, as are the proprietary fund financial statements. Under the accrual basis of accounting, revenues, expenses, gains, losses, assets, deferred outflows/inflows of resources, and liabilities resulting from exchange and exchange -like transactions are recognized when the exchange takes place. Revenues, expenses, gains, losses, assets, and liabilities resulting from nonexchange transactions are recognized in accordance with the requirements of GASB Statement 33 — Accounting and Financial Reporting for Nonexchange Transactions. Program revenues include charges for services, special assessments, and payments made by parties outside of the reporting government's citizenry if that money is restricted to a particular program. Program revenues are netted with program expenses in the statement of activities to present the net expense of each program. 49 Indian River County, Florida Notes To Financial Statements Year Ended September 30, 2014 NOTE 1— SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES — Continued B. Measurement Focus and Basis of Accounting - Continued 1. Government -wide Financial Statements - Continued Amounts paid to acquire capital assets are capitalized as assets in the government -wide financial statements, rather than reported as expenditures. Issuance of long-term debt is recorded as a liability in the government -wide financial statements, rather than as an other financing source. Amounts paid to reduce long-term indebtedness of the reporting government are reported as a reduction of the related liability, rather than as an expenditure. As a general rule, the effect of interfund activity has been eliminated from the government -wide financial statements. The County chooses to eliminate the indirect costs between governmental activities to avoid a "doubling up" effect. However, interfund services provided and used, such as the sale of gas and diesel from Fleet Management to the government, are not eliminated in the statement of activities. 2. Fund Financial Statements The underlying accounting system of the County is organized and operated on the basis of separate funds, each of which is considered to be a separate accounting entity. The operations of each fund are accounted for with a separate set of self -balancing accounts that comprise its assets, deferred outflows of resources, liabilities, deferred inflows of resources, fund balance, revenues and expenditures or expenses, as appropriate. Governmental resources are allocated to and accounted for in individual funds based upon the purposes for which they are to be spent and the means by which spending activities are controlled. Fund financial statements for the primary government's governmental, proprietary, and fiduciary funds are presented after the government -wide financial statements. These statements display information about major funds individually and nonmajor funds in the aggregate for governmental and enterprise funds. Governmental Funds 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 collected within the current period or soon enough thereafter to pay liabilities of the current period. For this purpose, the County considers revenues to be available if they are collected within 45 days of the end of the current fiscal period. Expenditures generally are recorded when a liability is incurred, as under accrual accounting. Franchise fees, sales taxes, gas taxes, operating and capital grants, and interest associated with the current fiscal period are all considered to be susceptible to accrual and so have been recognized as revenues of the current fiscal period. All other revenue items are considered to be measurable only when the County receives cash. 50 1 Indian River County, Florida Notes To Financial Statements Year Ended September 30, 2014 NOTE 1— SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES — Continued B. Measurement Focus and Basis of Accounting - Continued 2. Fund Financial Statements - Continued Governmental Funds - Continued Under the current financial resources measurement focus, only current assets, deferred outflows of resources, current liabilities and deferred inflows of resources are generally included on the balance sheet. The reported fund balance is considered to be a measure of "available spendable resources". Governmental funds operating statements present increases (revenues and other financing sources) and decreases (expenditures and other financing uses) in net fund balance. Accordingly, they are said to present a summary of sources and uses of "available spendable resources" during a period. Non-current portions of special assessments due to governmental funds are reported on their balance sheets in spite of their spending measurement focus. Non-current portions of notes receivable and advances to other funds are offset by fund balance reserve accounts. Because of their spending measurement focus, expenditure recognition for governmental fund types excludes amounts represented by noncurrent liabilities. Since they do not affect fund balances, such long-term amounts are not recognized as governmental fund type expenditures or fund liabilities. Amounts expended to acquire capital assets are recorded as expenditures in the year that resources were expended, rather than as fund assets. The issuance of long-term debt is recorded as an other financing source rather than as a fund liability. However, debt service expenditures, as well as expenditures related to compensated absences and claims and judgments, are recorded only when payment is due. Proprietary Funds The County' s enterprise funds and internal service funds are proprietary funds. In the fund financial statements, proprietary funds are presented using the accrual basis of accounting. Revenues are recognized when they are earned and expenses are recognized when the related goods or services are delivered. In the fund financial statements, proprietary funds are presented using the economic resources measurement focus. This means that all assets, deferred outflows of resources, liabilities and I deferred inflows of resources (whether current or noncurrent) associated with their activity are included on their balance sheets. Proprietary fund type operating statements present increases (revenues) and decreases (expenses) in total net position. Proprietary fund operating revenues result from exchange transactions associated with the principal activity of the fund. Exchange transactions are those in which each party receives and gives up ' essentially equal values. Non-operating revenues result from non-exchange transactions or ancillary activities (for example, interest income). Operating expenses are costs incurred to provide services, whereas non-operating expenses are costs of debt financings, amortization of intangible assets and losses on the sale of assets. 1 Indian River County, Florida Notes To Financial Statements Year Ended September 30, 2014 NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES — Continued B. Measurement Focus and Basis of Accounting - Continued Proprietary Funds - Continued Amounts paid to acquire capital assets are capitalized as assets in the fund financial statements, rather than reported as expenditures. Issuance of long-term debt is recorded as a liability in the fund financial statements, rather than as an other financing source. Amounts paid to reduce long-term indebtedness are reported as a reduction of the related liabilities, rather than as an expense. Fiduciary Funds The fiduciary funds financial statements include financial information for the agency fund and the other postemployment benefit trust fund. The agency fund of the County primarily represents assets held by the County in a custodial capacity for other individuals or governments. The other postemployment benefits trust fund (Trust) accounts for activities of the Trust, which accumulates resources for health insurance benefit payments for current retirees and for current employees upon their retirement. The agency and Trust fund statements are presented using the accrual basis of accounting. r Basis of Presentation GASB Statement 34 sets forth minimum criteria (percentage of the assets, liabilities, deferred outflows/inflows of resources, revenues or expenditures/expenses of either fund category and the governmental and enterprise combined) for the determination of major funds. The County has used GASB 34 minimum criteria for major fund determination and has also electively disclosed funds that either had debt outstanding or specific community focus as major funds. The nonmajor funds are combined in a column in the fund financial statements and detailed in the combining section. 1. Governmental Major Funds General Fund — The General Fund is the general operating fund of the County. It is used to account for all financial resources, except those accounted for and reported in another fund. Impact Fees Fund — The Impact Fees Fund accounts for the receipt of various impact fees. Funds are used for the construction of roads and bridges, correctional, public safety, library, park, public building, and solid waste facilities. Funds are also used for administrative expenditures of monitoring the aforementioned activities. Secondary Roads Construction Fund — The Secondary Roads Construction Fund accounts for the expenditures of road and bridge construction, roadway, bridge and right of way maintenance and drainage, and related administrative costs. Financing is provided by collections of the local option gas tax. Transportation Fund — The Transportation Fund accounts for expenditures incurred for the maintenance and repair of County roads. Financing is provided by the 5th and 6th cent gas taxes, county gas tax and transfers from the General Fund. 52 Indian River County, Florida Notes To Financial Statements Year Ended September 30, 2014 NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES — Continued C. Basis of Presentation - Continued 1. Governmental Major Funds - Continued Emergency Services District Fund — The Emergency Services District Fund accounts for the expenditures of providing fire protection and advanced life support to the County. Financing is provided by ad valorem taxes. Optional Sales Tax Fund — The Optional Sales Tax Fund accounts for revenues generated by the local option one -cent sales tax and some capital grants that use the local option one -cent sales tax as matching funds. Monies are used for various capital projects. 2. Proprietary Major Funds Solid Waste Disposal District Fund — The Solid Waste Disposal District Fund accounts for the revenues, expenses, assets and liabilities associated with the County landfill. Golf Course Fund — The Golf Course Fund accounts for the revenues, expenses, assets and liabilities associated with the Golf Course. County Utilities Fund — The County Utilities Fund accounts for the revenues, expenses, assets and liabilities associated with the County water and sewer system. County Building Fund — The County Building Fund accounts for revenues, expenses, assets and liabilities associated with the County building permit and inspection program. 3. Other Fund Types Internal Service Funds — Internal Service Funds account for Fleet Management, Self Insurance and Information Technology services provided to other departments of the County on a cost reimbursement basis. Agency Fund - The Agency Fund is used to account for assets held in a custodial capacity by the County for other governmental units, other funds, individuals and businesses. Examples include payroll deductions, self insurance premiums, and developer escrow funds. Other Postemployment Benefits Trust Fund — The Other Postemployment Benefits Trust Fund (Trust) accounts for activities of the Trust, which accumulates resources for health insurance benefit payments for current retirees and for current employees upon their retirement. Contributions are recorded when earned and benefit payments and refunds when incurred within each year. 53 Indian River County, Florida Notes To Financial Statements Year Ended September 30, 2014 NOTE 1— SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES — Continued C. Basis of Presentation — Continued 4. Non-current Governmental Assets/Liabilities GASB Statement 34 requires non-current governmental assets, such as land and buildings, and non- current governmental liabilities, such as general obligation bonds and capital leases, be reported in the governmental activities column in the government -wide Statement of Net Position. D. Assets, Liabilities, Deferred Outflows/Inflows of Resources and Net Position or Fund Balances 1. Cash and Cash Equivalents Cash and cash equivalents include deposits and all highly liquid investments with maturities of ninety days or less when purchased. The County maintains a cash and investment pool that is available for use by all funds. Earnings from the pooled investments are allocated to the respective funds based on applicable cash participation by each fund. The investment pool is managed such that all participating funds have the ability to deposit and withdraw cash as if they were demand deposit accounts. Therefore, all balances representing participants' equity in the investment pools are classified as cash and cash equivalents for financial statement purposes. In addition, longer-term investments are held by several of the County's funds and are reported as restricted cash on these statements. Cash and cash equivalents of the constitutional officers are maintained in separate accounts, but have been combined with the Board's cash and cash equivalents for financial statement purposes. When restricted and unrestricted resources are available, expenses are paid first from restricted resources. 2. Investments Investments consist of U.S. Treasury Securities, U.S. Government Agency Securities, money market funds, Florida PRIME Fund (formerly known as the Local Government Surplus Funds Trust Fund Investment (SBA) Fund A), and the Florida Local Government Investment Trust Fund (FLGIT). Investments are reported at fair value based upon the average price obtained from three brokers/dealers. The SBA and FLGIT values are based upon the fair market value per share of the underlying portfolio. Refer to Note 4-C, Investments, for further information on individual investments. 54 Indian River County, Florida Notes To Financial Statements Year Ended September 30, 2014 NOTE 1— SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES — Continued D. Assets, Liabilities, Deferred Outflows/Inflows of Resources and Net Position or Fund Balances - Continued 3. Allowance for Doubtful Accounts The County provides an allowance for water and sewer and ambulance services accounts receivables that may become uncollectible. At September 30, 2014, the allowance for water and sewer services was $424,493 and the allowance for ambulance services was $644,383. No other allowances for doubtful accounts are maintained since other accounts receivable are considered collectible as reported at September 30, 2014. 4. Receivables and Payables Activities between funds that are representative of lending/borrowing arrangements outstanding at the end of the fiscal year are referred to as "due to/from other funds". Any residual balances outstanding between the governmental activities and business -type activities are reported in the government -wide financial statements as "internal balances". All receivables are shown net of allowance for doubtful accounts. Receivables in excess of 120 days comprise the trade accounts receivable allowance for doubtful accounts. 5. Inventories Inventories are valued at cost, which approximates market, using the "first -in, first -out" method of accounting, with the exception of the Golf Course and Fleet Internal Service Fund's inventories which are valued using the average cost method of accounting. Inventories of all funds are recorded as expenditures (expenses) when consumed rather than when purchased. 6. Prepaid Items Prepaid items in the governmental funds represent prepayments for services that will be used in future periods. The County's policy is to record the expenditure for the services when they are used rather than when the cash is disbursed. 7. Restricted Net Position Certain resources of the County are classified as restricted net position on the statement of net position because their use is limited either by law through constitutional provisions or enabling legislation; or by restrictions imposed externally by creditors, grantors, contributors, or laws or regulations of other governments. In a fund with both restricted and unrestricted net position, qualified expenses are considered to be paid first from restricted net position and then from unrestricted net position. Further information on the restrictions can be found in Note 21. 55 Indian River County, Florida Notes To Financial Statements Year Ended September 30, 2014 NOTE 1— SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES — Continued D. Assets, Liabilities, Deferred Outflows/Inflows of Resources and Net Position or Fund Balances - Continued 8. Capital Assets Capital assets, which include property, plant, equipment, infrastructure (e.g., roads, bridges, right-of- ways, water and sewer distribution systems, beach restoration, stormwater systems and similar items), and intangible assets (e.g. software, easements, and rights), are reported in the applicable governmental or business -type activities column in the government -wide financial statements. The County defines capital assets as assets with an initial, individual cost of $1,000 or more and an estimated useful life in excess of one year. Except for roads and bridges constructed prior to October 1, 1981, assets are recorded at historical cost. Roads and bridges constructed prior to October 1, 1981 are reported at estimated historical cost. Donated capital assets are recorded at estimated fair market value at the date of donations. Transfers of capital assets within the County are recorded at their carrying value at the time of the transfer. The costs of normal maintenance and repairs that do not add to the value of the asset nor materially extend its useful life are not capitalized. Major outlays for capital assets and improvements are capitalized as projects are constructed. Interest incurred during the construction phase of capital assets of business -type activities is included as part of the capitalized value of the assets constructed. The Board holds legal title to the capital assets used in the operations of the Board, Clerk of the Circuit Court and Comptroller, Property Appraiser, Supervisor of Elections and Tax Collector, and is accountable for them under Florida Law. The Sheriff is accountable for and thus maintains capital asset records pertaining only to equipment used in his operations. These assets have been combined with the Board's governmental activities capital assets in the statement of net position. Property, plant, equipment, intangible, and infrastructure assets of the primary government, as well as the component units, are depreciated using the straight-line method over the following estimated useful lives: Assets Years Building and improvements 10 — 50 Machinery and equipment 3 — 10 Utility distribution system 25 — 50 Road and bridge infrastructure 20 — 50 Fiberoptics 20 Software 3-5 Beach preservation infrastructure 7 Stormwater infrastructure 30 56 Indian River County, Florida Notes To Financial Statements Year Ended September 30, 2014 NOTE 1— SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES — Continued D. Assets, Liabilities, Deferred Outflows/Inflows of Resources and Net Position or Fund Balances - Continued 9. Capitalization of Interest Interest costs related to bond issues are capitalized during the construction period. These costs are netted against applicable interest earnings on construction fund investments. During the current period, the County did not have any capitalized interest. 10. Deferred Outflows/Inflows of Resources In addition to assets, the statement of financial position will sometimes report a separate section for deferred outflows of resources. Deferred outflows of resources represent 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. The County reports the deferred charge on refundings in the amount of $2,245,798 in this category on the government -wide statement of net position. A deferred charge on refundings results from the difference in the carrying value of refunded debt and its reacquisition price. This amount is deferred and amortized over the shorter of the life of the refunded or refunding debt. In addition to liabilities, the statement of financial position may report a separate section for deferred inflows of resources. Deferred inflows of resources represent 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 County only has one item, unavailable revenue, which arises under the modified accrual basis of accounting and is reported on the governmental funds balance sheet in the total amount of $3,124,809. The sources of the unavailable revenue are a special assessment on road paving, ambulance service billings, and state and federal grants. These amounts are deferred and recognized as an inflow of resources in the period that the amounts become available. 11. Unearned Revenues Unearned revenues represent revenues, which are available but unearned. At September 30, 2014, the total amount of unearned revenues reported on the statement of net position for the governmental activities is $341,400 and for the business -type activities is $32,771. 12. Accrued Compensated Absences The County accrues accumulated unpaid vacation and sick leave when earned by the employee. The current portion is the amount estimated to be used in the following year. The non-current portion is the amount estimated to be used in subsequent fiscal years. Both the current and non-current estimated accrued compensated absences amounts for governmental funds are maintained separately and represent a reconciling item between the fund and government -wide presentations. 57 Indian River County, Florida Notes To Financial Statements Year Ended September 30, 2014 NOTE 1— SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES — Continued D. Assets, Liabilities, Deferred Outflows/Inflows of Resources and Net Position or Fund Balances - Continued 13. Obligation for Bond Arbitrage Rebate Pursuant to Section 148(f) of the U. S. Internal Revenue Code, the County must rebate to the United States Government the excess of interest earned from the investment of certain debt proceeds and pledged revenues over the yield rate of the applicable debt. The County uses the "revenue reduction" approach in accounting for rebatable arbitrage. This approach treats excess earnings as a reduction of revenue. The County has no arbitrage liability outstanding as of September 30, 2014. 14. Landfill Closure Costs Under the terms of current state and federal regulations, the Solid Waste Disposal District (SWDD) is required to place a final cover on closed landfill areas, and to perform certain monitoring and maintenance functions for a period of up to thirty years after closure. The SWDD recognizes these costs of closure and post -closure maintenance over the active life of each landfill area, based on landfill capacity used during the period. Required obligations for closure and post -closure costs are recognized in the Solid Waste Disposal District Enterprise Fund. 15. Unamortized Bond Discounts and Premiums Bond discounts and premiums associated with the issuance of proprietary fund revenue bonds are amortized according to the straight-line method over the remaining life of the bonds. For financial reporting, unamortized bond discounts and premiums are netted against the applicable long-term debt. 16. Capital Contributions The capital contributions accounted for in the proprietary fund types represent contributions from other funds, developers, state and federal grant programs, and impact fees charged to new customers for their anticipated burden on the existing system. The contributions amount is reported after non-operating revenues and expenses on the Statement of Revenues, Expenses, and Changes in Fund Net Position in accordance with GASB Statement 33. Capital contributions for the governmental funds are reported on the Statement of Activities in accordance with GASB Statement 34 and represent contributions of capital assets from developers and state agencies. 58 1 Indian River County, Florida ' Notes To Financial Statements Year Ended September 30, 2014 NOTE 2 - RECONCILIATION OF GOVERNMENT -WIDE AND FUND FINANCIAL STATEMENTS ' A. Explanation of Differences Between the Governmental Fund Balance Sheet and the Government -wide Statement of Net Position I "Total fund balances" of the County's governmental funds, $173,415,560 differs from "net position" of governmental activities, $703,841,710, reported in the statement of net position. This difference primarily results from the long-term economic focus of the statement of net position versus the current I financial resources focus of the governmental funds balance sheet. Capital related items When capital assets (property, plant, equipment, intangibles) that are to be used in governmental activities are purchased or constructed, the costs of those assets are reported as expenditures in 1 governmental funds. However, the statement of net position included those capital assets among the assets of the County as a whole. 1 Cost of capital assets $ 828,281,566 Accumulated depreciation ( 279.562.524) Net Total $ 548,719,042 Long-term debt transactions 1 Long-term liabilities applicable to the County's governmental activities are not due and payable in the current period and accordingly are not reported as fund liabilities. All liabilities (both current and long- term) are reported in the statement of net position. Balances at September 30, 2014 were: 1 Bonds payable: Limited General Obligation Bonds, Series 2006 (26,010,000) ' Spring Training Facility Bonds, Series 2001 (7,700,000) Bond premium payable: Limited General Obligation Bonds, Series 2006 (629,265) Medicaid settlement payable (474,260) Pollution remediation payable (2,671,800) Compensated absences (10,523,367) Total $ (48,008,692) Accrued interest ' Accrued liabilities in the statement of net position differs from the amount reported in governmental funds due to accrued interest on the Limited General Obligation Bonds, Series 2006. 1 Accrued interest $ (301,178) ' 59 Indian River County, Florida Notes To Financial Statements Year Ended September 30, 2014 NOTE 2 - RECONCILIATION OF GOVERNMENT -WIDE AND FUND FINANCIAL STATEMENTS - Continued A. Explanation of Differences Between the Governmental Fund Balance Sheet and the Government -wide Statement of Net Position - Continued Deferred Inflow of Resources — Unavailable Revenue Deferred inflows of resources reported on the statement of net position differ from the amount reported in governmental funds due to special assessments. Governmental fund financial statements report revenues, which are measurable but not available as unavailable revenue, a deferred inflow of resources. However, unavailable revenues in governmental funds are susceptible to full accrual on government -wide financial statements. Unavailable revenues $ 3,124,809 Internal service funds Internal service funds are used by management to charge the costs of fleet management, insurance activities, and information technology services to individual funds. The assets and liabilities of the internal service funds are included in governmental activities in the statement of net position because they primarily serve governmental activities of the County. Internal service funds $ 26,048,127 Accrued interest revenues Some interest revenues are not recognized in the current period because the resources are not available; therefore, these revenues are not reported in the fund. Accrued interest revenues $ 48,675 Net OPEB Obligation The net OPEB obligation asset resulting from contributions in excess of the annual required contribution is not a financial resource; therefore, it is not reported in the fund. OPEB asset $ 795,367 Elimination of interfund receivables/payables Interfund receivables and payables in the amount of $666,160 between governmental funds must be eliminated for the statement of net position. 60 Indian River County, Florida Notes To Financial Statements Year Ended September 30, 2014 NOTE 2 - RECONCILIATION OF GOVERNMENT -WIDE AND FUND FINANCIAL STATEMENTS - Continued B. Explanation of Differences Between Governmental Fund Operating Statements and the Statement of Activities The "net change in fund balances" for governmental funds, $854,114, differs from the "change in net position" for governmental activities, $11,922,277 reported in the statement of activities. The differences arise primarily from the long-term economic focus of the statement of activities versus the current financial resources focus of the governmental funds. The effect of the differences is illustrated below. Capital related items When capital assets that are to be used in governmental activities are purchased or constructed, the resources expended for those assets are reported as expenditures in governmental funds. However, in the statement of activities, the costs of those assets are allocated over their estimated useful lives and reported as depreciation expense. As a result, fund balances decrease by the amount of financial resources expended, whereas net position decreases by the amount of depreciation expense charged for the year. Capital outlay $ 27,952,771 Depreciation expense (19,715,820) Loss on assets (45,603) Difference $ 8,191,348 Long-term debt transactions Payments of bond principal, bond premium, and pollution remediation costs are reported as an expenditure in the governmental funds and, thus, have the effect of reducing fund balance because current financial resources have been used. However, the payments reduce the liabilities in the statement of net position and do not result in an expense in the statement of activities. Bond principal payments made $ 3,700,000 Bond premium payments made 93,224 Medicaid settlement costs 158,082 Pollution remediation costs 55,600 Total $ 4,006,906 Governmental funds report interest and OPEB expenditures based on when they are paid. The statement of activities reports interest expense as it is incurred. This is the net number of the previous year accrual and the current year accrual. Net accrued OPEB expense Net accrued bond interest payable Total 61 $ 494,761 40.387 $ 535.148 Indian River County, Florida Notes To Financial Statements Year Ended September 30, 2014 NOTE 2 - RECONCILIATION OF GOVERNMENT -WIDE AND FUND FINANCIAL STATEMENTS - Continued B. Explanation of Differences Between Governmental Fund Operating Statements and the Statement of Activities - Continued Long-term debt transactions — Continued Some expenses reported in the statement of activities do not require the use of current financial resources; therefore, are not reported as expenditures in governmental funds. Net change in compensated absences $ 727,555 Internal service funds operating loss The assets and liabilities of the internal service funds are included in governmental activities in the statement of net position because they primarily serve governmental activities of the County. The net costs of the internal service funds are reported with governmental activities. Internal service funds operating loss $ (1,964,753) Accrued revenues Some revenues are not recognized in the current period because the resources are not available, or they have been reported in a prior period; therefore, these revenues are not reported in the fund. This number is a net number of prior year accrual and current year accrual. Net accrued revenues $ (432,287) Accrued interest revenues Some interest revenues are not recognized in the current period because the resources are not available; therefore, these revenues are not reported in the fund. This number is a net number of prior year accrual and current year accrual. Net accrued interest revenues $ 4,246 Reclassification and Eliminations The governmental funds recognize revenues in the amount of $2,063,220 for the general administrative charges to the general government, public safety, transportation, economic environment, culture/recreation, and court related functions. These revenues and expenditures must be eliminated to avoid double counting. Transfers in and transfers out in the amount of $10,092,644 between governmental activities should be eliminated. Capital projects costs in the amount of $16,560,991 must be distributed to the related expenditure functions. 62 Indian River County, Florida Notes To Financial Statements Year Ended September 30, 2014 NOTE 3 - STEWARDSHIP, COMPLIANCE, AND ACCOUNTABILITY Budgets and Budgetary Accounting The County uses the following procedures in establishing the budgetary data reflected in the financial statements: (1) The constitutional officers submit, at various times, to the Board and to certain divisions within the Florida Department of Revenue and the Florida Clerks of Court Operations Corporation, a proposed operating budget for the following fiscal year. The operating budget includes proposed expenditures and the means of financing them, as set forth in Chapter 129 of the Florida Statutes. (2) The Department of Revenue, State of Florida, has the final authority on the operating budgets for the Tax Collector and the Property Appraiser included in the General Fund. (3) Constitutional officers, all departments controlled by the Board, and outside state and local agencies submit their proposed budgets to the Office of Management and Budget for assistance, review and compilation. The County Administrator then reviews all County departments, state agencies and nonprofit organization's budgets and makes his budget recommendation to the Board. (4) On or before July 15 of each year, the County Administrator and the Director of the Office of Management and Budget, as the Board's designated budget officer, submit to the Board a tentative budget for the ensuing fiscal year. The tentative budget includes proposed expenditures and the means of financing them. The Board then holds workshops to review the tentative budget by fund on a departmental level. (5) During September, public hearings are held pursuant to Section 200.065 of the Florida Statutes in order for the Board to receive public input on the tentative budget. At the end of the last public hearing, the Board enacts ordinances to legally adopt the budgets at the fund level. The budgets legally adopted by the Board set forth the anticipated revenues by source and the appropriations by function. (6) Formal budgetary integration on an object level is used as a management control device for the governmental and proprietary funds of the County. Management is authorized to transfer budgeted amounts between objects and departments in any fund as long as management does not exceed the total appropriations of a fund. Board approval to amend the budget is only required when unanticipated revenues are received that management wishes to have appropriated, thereby increasing the total appropriations of a fund. (7) Budgets for the governmental and proprietary fund types are adopted on a basis consistent with generally accepted accounting principles. (8) Appropriations for the County lapse at the close of the fiscal year. 63 Indian River County, Florida Notes To Financial Statements Year Ended September 30, 2014 NOTE 4 - CASH AND CASH EQUIVALENTS The County maintains a cash and investment pool that is available for use by all funds except those whose cash and investments must be segregated due to bond covenants or other legal restrictions. A. Deposits At September 30, 2014, the carrying amount of the primary government's deposits was $33,509,195 and the bank balance was $38,108,091. The County's policy requires all deposits with financial institutions to be 100% insured by federal depository insurance or by collateral provided by qualified public depositories to the State Treasurer, in accordance with Chapter 280, Florida Statutes also known as the Florida Security for Public Deposits Act. The Act established a Trust Fund, maintained by the State Treasurer, which is a multiple financial institution pool with the ability to assess its member financial institutions for collateral shortfalls if a member fails. Cash on hand at September 30, 2014 was $26,395. B. Accrued Interest Interest earnings on U.S. Treasury Notes and government agency bonds are recorded in the cash and investment pools and then allocated to each fund based on each fund's average monthly balance. As of September 30, 2014, accrued interest for the County's portfolio totaled $153,990. The remaining accrued interest is reflected in utilities and road paving assessments. C. Investments On July 24, 2014, the Board updated its investment policy to reflect the following change in valuing its portfolio: the portfolio will be marked to market with an average of three brokers evaluations. The Tax Collector adopted a formal investment policy in February 2005, with the latest revision done in June 2014. The Clerk adopted a formal investment policy on April 25, 2013 and updated the policy on April 24, 2014. 64 Indian River County, Florida Notes To Financial Statements Year Ended September 30, 2014 NOTE 4 - CASH AND CASH EQUIVALENTS - Continued C. Investments - Continued As of September 30, 2014, the County had the following investments: Investment Type Fixed Rate Debt Instruments: U.S. Treasuries U.S. Agencies:*** Federal Farm Credit Bureau Federal Home Loan Bank Federal Home Loan Mortgage Federal National Mortgage Assoc. Other Fixed Rate Instruments: Certificate of Deposit-CenterState Certificate of Deposit -Harbor Community Certificate of Deposit -Harbor Community Certificate of Deposit -Harbor Community Other Market Rate Investments: Florida PRIME (Formerly Fund A) Florida Local Government Investment Trust Fund Florida Trust Day to Day Fund Regions Bank Money Market TD Bank Money Market Harbor Community Bank Money Market Florida Community Bank Money Market BankUnited Money Market W&S Sinking Fund Reserve: U.S. Treasuries Fidelity Institutional Money Market Total Fair Value Fair Value $ 120,071,970 29,977,122 26,968,778 15,970,150 6,999,102 252,358 255,857 252,208 3,016,949 Weighted Average Maturity In Years 0.95 0.79 1.16 1.57 0.27 0.74 1.30 0.82 1.35 95,999 0.08 11,448,484 25,296 13,091,698 20,027,524 1,652,263 1,502,500 27,261,551 5,460,324 7,784 $ 284,337,917 0.08 0.08 0.08 0.08 0.08 0.08 0.08 1.03 0.08 Portfolio Credit Percentage Risks* 42.23% N/A 10.54 AA+ 9.48 AA+ 5.62 AA+ 2.46 AA+ 0.09 N/A 0.09 N/A 0.09 N/A 1.06 N/A 0.03 AAAm AAAf and 4.03 S-1** 0.01 AAAm 4.60 N/A 7.04 N/A 0.58 N/A 0.53 N/A 9.59 N/A 1.93 N/A AAAm 100% Weighted Average Maturity of Investments 0.75 * Ratings based upon Standard and Poor's ** AAAf credit quality, S-1 Market Volatility *** The weighted calculation considers the investments are carried until full maturity (i.e. call dates are not considered) 65 Indian River County, Florida Notes To Financial Statements Year Ended September 30, 2014 NOTE 4 - CASH AND CASH EQUIVALENTS - Continued C. Investments - Continued Florida PRIME (formerly known as the Local Government Surplus Funds Trust Investment (SBA) Fund A) is a money market fund classified as a "2a-7 like fund" using the SEC investment requirements for 2a-7 funds. The fund was established by Florida Statute 218.405 and is administered by the Florida State Board of Administration. The Florida Local Government Investment Trust Fund is a pool of various securities with maturities of less than five years. The fund was established by Florida Statute 163.01, is administered by the Florida Association of Court Clerks, and is marked to market daily. Interest Rate Risk The County's investment policy limits interest rate risk by attempting to match investment maturities with known cash needs and anticipated cash flow requirements. All investments must have stated maturities of ten (10) years or less and no more than 25% of the portfolio shall be invested in instruments with stated final maturities greater than five (5) years. The portfolio shall have securities with varying maturity and at least 10% of the portfolio shall be invested in readily available funds. All constitutional officers with the exception of the Tax Collector and Clerk follow this policy. The Tax Collector's policy is to limit maturities to 24 months or less. The Clerk's policy is to limit maturities to three years or less and maintain at least 50% of the portfolio in readily available funds. 66 Indian River County, Florida Notes To Financial Statements Year Ended September 30, 2014 NOTE 4 - CASH AND CASH EQUIVALENTS - Continued C. Investments - Continued Credit Risk Florida Statutes Section 218.415 and the County's investment policy limit investments to the following: 1. Direct obligations of the United States Treasury; 2. Florida PRIME (formerly known as Fund A); 3. Florida Local Government Investment Trust Funds; 4. Interest-bearing time deposits or savings in qualified public depositories as defined in Section 280.02 Florida Statutes; 5. Federal agencies and instrumentalities; 6. Securities of, or other interests in, any open-end or closed-end management -type investment company or investment trust registered under the Investment Company Act of 1940, 15 U.S.C. ss. 80a-1 et seq., as amended from time to time, provided that the portfolio of such investment company or investment trust is limited to obligations of the United States Government or any agency or instrumentality thereof and to repurchase agreements fully collateralized by such United States Government obligations, and provided that such investment company or investment trust takes delivery of such collateral either directly or through an authorized custodian; 7. Securities and Exchange Commission registered money market funds with the highest credit quality rating from a nationally recognized rating agency; 8. Repurchase agreements with a term of one year or less collateralized by direct obligations of the United States Government which have maturities of three (3) years or less and a market value 103% or more of the repurchase amount. Concentration Risk The Indian River County Board of County Commissioners, the Clerk of the Circuit Court and Comptroller, and the Tax Collector follow their own investment policies. The policies have established asset allocation and issuer limits to reduce concentration of credit risk. Their investments are stated at fair value. The Board's investment policy does not allow for more than 20% of the entire portfolio to be invested in any one issuer, with the exception of United States Treasury Obligations and state authorized pools. No more than 10% of the portfolio may be placed in certificates of deposit (CD) and no more than $3 million of the portfolio may be placed in certificates of deposit with any one financial institution. No more than 10% of the portfolio may be placed in any one money market fund, mutual fund, or intergovernmental investment pool. 67 Indian River County, Florida Notes To Financial Statements Year Ended September 30, 2014 NOTE 4 - CASH AND CASH EQUIVALENTS - Continued C. Investments - Continued Concentration Risk - Continued The Tax Collector's cash and investment policy limits portfolio composition to the following maximum guidelines: Local Government Surplus Funds Trust Fund 95% Florida Trust Day to Day Fund 95% Direct Obligations of the U.S. Government 25% Money Market, CD's, and Savings Accounts 95% Securities & Exchange Commission Money Funds 25% Bank Super NOW Accounts 95% Bank Repo Agreements 50% United States Government Agencies 25% The Clerk's cash and investment policy limits portfolio composition to no more than 10% or $1 million in certificates of deposit with a qualified public depository with any one financial institution. The Clerk's cash and investment policy was updated in April 2014 to limit no more than 40% of the portfolio in any money market fund or intergovernmental investment pool. Custodial Credit Risk The Board's investment policy pursuant to Section 218.415 (18), Florida Statutes requires securities to be registered and shall be held with a third party custodian and all securities purchased by, and all collateral obtained by, the Board shall be held in the name of the Board. The securities must be held in an account separate and apart from the assets of the financial institution. As of September 30, 2014, the County's investment portfolio in U.S. Treasuries, U.S. Agencies, and money market funds, was held by The Bank of New York/Mellon. Additional investments include the Florida Local Government Investment Trust (held by the Bank of New York/Mellon) and the Florida Trust Day to Day Fund (held by UMB Bank). D. OPEB Trust Investments Funds are held in the name of the Indian River County OPEB Trust (OPEB Trust), an irrevocable trust, by a third party custodian, Bank of New York/Mellon. The investments are reported at fair value based upon market -close price on the last business day of each month. 68 1 0 1 1 1 0 1 1 1 1 1 1 Indian River County, Florida Notes To Financial Statements Year Ended September 30, 2014 NOTE 4 - CASH AND CASH EQUIVALENTS - Continued D. OPEB Trust Investments - Continued The County approved a separate investment policy for the OPEB Trust assets on February 3, 2009 (last amended on November 5, 2013). The County adopted a broadly diversified portfolio composition consisting of equity, debt, and cash and cash equivalents. Asset allocations are divided between short- term and long-term investments. Short-term asset allocations include cash and cash equivalents with maturities of 180 days or less. Long-term asset allocations range from 0-60% for equities, 0-60% for fixed income securities, and 0-100% for cash and cash equivalents. The contribution of $3,426,879 for the year ended September 30, 2014 was invested in the various funds listed below. As of September 30, 2014, the OPEB Trust had the following investments: Investment Type Short -Term Portion: Weighted Average Maturity Portfolio Credit Fair Value InYears Percentage Risks* Fidelity Treasury Money Market $ 7,263 0.11 Long -Term Portion: 0.05% AAAm Vanguard 500 Index 3,146,175 N/A 22.41 N/A Vanguard All World Ex -US 2,773,589 N/A 19.76 N/A Vanguard Mid Cap Index 717,849 N/A 5.11 N/A Vanguard Small Cap Index 345,886 N/A 2.46 N/A Vanguard Short -Term Treasury 4,238,737 2.60 30.19 AA+ Vanguard Intermediate Treasury 1,409,132 5.90 10.04 AA+ Vanguard Prime Money Market 1,194,575 0.16 8.51 A-1 Vanguard Federal Money Market 205,626 0.16 1.47 A-1 Total Fair Value $ 14,038,832 100.00% * Ratings based upon Standard and Poor's NOTE 5 - PROPERTY TAX REVENUES Taxable values for all property are established as of January 1, which is the date of lien, for the fiscal year starting October 1. Property tax revenues recognized for the 2013-2014 fiscal year were levied in October 2013. All taxes are due and payable on November 1 or as soon as the assessment roll is certified and delivered to the Tax Collector. Discounts are allowed for early payment at the rate of 4% in November, 3% in December, 2% in January, and 1% in February. Taxes paid in March are without discount. All unpaid taxes become delinquent as of April 1. Virtually all unpaid taxes are collected via the sale of tax certificates on or prior to June 1; therefore, there were no material taxes receivable at fiscal year-end. 69 Indian River County, Florida Notes To Financial Statements Year Ended September 30, 2014 NOTE 6 - CAPITAL ASSETS A. Governmental Activities Primary Government Governmental activities: Capital assets, not being depreciated: Land Construction in progress Right-of-way Intangibles Infrastructure Total capital assets, not being depreciated Capital assets, being depreciated: Buildings and improvements Equipment Intangibles Infrastructure Total capital assets, being depreciated Less accumulated depreciation for Buildings and improvements Equipment Intangibles Infrastructure Total accumulated depreciation Total capital assets, being depreciated, net Beginning Balance Additions Deletions $ 140,713,835 $ 194,953 $ 36,893,868 23,582,133 55,679,074 1,281,241 818,627 176,927 3,575,067 - 237,680,471 25,235,254 (24,768,244) (7,633,990) $ (17,013,947) (120,307) 197,350,794 56,757,645 3,076,000 310,442,937 567,627,376 (54,347,848) (44,594,320) (2,470,483) (163,149,329) 13,891,957 4,788,028 1,080,829 8,067,482 (162, 874) (2,680,898) (84,128) 27,828,296 (2,927,900) (5,471,368) (4,264,431) (243,566) (9,912,624) (264,561,980) (19,891,989) 303,065,396 118,851 2,679,318 84,128 Ending Balance 133,274,798 43,462,054 56,840,008 995,554 3,575,067 238,147,481 211,079,877 58,864,775 4,072,701 318,510,419 592,527,772 (59,700,365) (46,179,433) (2,629,921) (173,061,953) 2,882,297 (281,571,672) 7,936,307 (45,603) 310,956,100 Governmental activities capital assets, net $ 540,745,867$ 33,171,561 $ (24,813,847) $ 549,103,581 Beginning balance amounts for construction in progress have been reduced by $0.2 million that is contributed to and reported by a grant sub -recipient. Beginning balance amounts for accumulated depreciation have been reduced to reflect adjustments to beginning net position. See Note 21B for further explanation. 70 j 0 1 1 0 e Indian River County, Florida Notes To Financial Statements Year Ended September 30, 2014 NOTE 6 - CAPITAL ASSETS — Continued A. Governmental Activities - Continued Depreciation expense, which includes amortization expense on intangible assets, was charged to the functions/programs of the primary government's governmental activities as follows: General government $ 2,566,360 Public safety 3,714,575 Physical environment 606,091 Transportation 6,144,714 Economic environment 453 Human service 136,300 Culture/recreation 6,459,471 Court related 87,856 Capital assets held by the government's internal service funds are charged to the various functions based on their usage of the assets 176,169 Total depreciation expense — governmental activities $ 19,891,989 71 Indian River County, Florida Notes To Financial Statements Year Ended September 30, 2014 NOTE 6 - CAPITAL ASSETS — Continued B. Business -type Activities Primary Government Business -type activities: Capital assets, not being depreciated: Land, Improvements to Land Intangibles Construction in progress Total capital assets, not being depreciated Capital assets, being depreciated: Buildings, distribution systems, & improvements Intangibles Equipment Total capital assets, being depreciated Less accumulated depreciation for Buildings, distribution systems, & improvements Intangibles Equipment Total accumulated depreciation Total capital assets, being depreciated, net Beginning Balance $ 27,322,149 $ 1,460,907 13,350,872 42,133,928 416,125,750 907,347 14,322,144 431,355,241 (208,946,932) (563,115) (12,692,380) (222,202,427) 209,152,814 Business -type activities capital assets, net $ 251,286,742 $ Additions 170,753 $ 35,873 Deletions -$ 10,330,452 (12,361,570) 10,537,078 (12,361,570) 13,669,688 (147,988) 177,532 1,172,778 (529,314) 15,019,998 (677,302) (15,077,362) • (85,138) (422,142) 126,170 501,807 (15,584,642) 627,977 (564,644) (49,325) 9,972,434 $ (12,410,895) $ Ending Balance 27,492,902 1,496,780 11,319,754 40,309,436 429,647,450 1,084,879 14,965,608 445,697,937 (223,898,124) (648,253) (12,612,715) (237,159,092) 208,538,845 248,848,281 Depreciation expense, which includes amortization expense on intangible assets, was charged to the functions/programs of the primary government's business -type activities as follows: Solid Waste Disposal District Golf Course County Utilities County Building Total depreciation expense — business -type activities 72 $ 929,378 208,949 14,432,329 13,986 $ 15,584,642 Indian River County, Florida Notes To Financial Statements Year Ended September 30, 2014 NOTE 7 - RESTRICTED CASH AND CASH EQUIVALENTS AND INVESTMENTS Various bond covenants, resolutions, and state regulations require that the County restrict cash and cash equivalents and investments within the business -type activities. Restricted cash and cash equivalents and investments are as follows: Sinking funds Renewal and replacement Customer deposits Capital construction Closure and maintenance costs Total Primary Government $ Solid Waste Disposal District 3,152,731 133,626 11,509,736 County Utilities $ 6,212,648 $ 3,485,928 2,808,885 19,635,118 $ 14,796,093 $ 32,142,579 Total 6,212,648 6,638,659 2,942,511 19,635,118 11,509,736 $ 46,938,672 Cash totaling $5,438,408 is reported as restricted on the Statement of Net Position for governmental activities. These funds are restricted for current liabilities such as retainage payable, accrued interest payable, and the current year portion of bonds payable. NOTE 8 - PAYABLE FROM RESTRICTED ASSETS Liabilities payable from the County's business -type activities restricted assets are as follows: Primary Government Accounts payable Retainage payable Accrued interest payable Customer deposits Bonds payable Closure and maintenance costs payable Total $ Solid Waste Disposal District 133,626 County Utilities $ 23,398 31,410 150,288 2,808,885 3,485,000 Total $ 23,398 31,410 150,288 2,942,511 3,485,000 11,509,736 11,509,736 $ 11,643,362 $ 6,498,981 $ 18,142,343 73 Indian River County, Florida Notes To Financial Statements - Year Ended September 30, 2014 NOTE 9 - INTERFUND BALANCES Interfund balances at September 30, 2014, consisted of the following: Receivable Fund Payable Fund Amount General Fund General Fund General Fund Nonmajor Governmental Funds Golf Course Enterprise Fund Fleet Internal Service Fund $ 274,500 865,051 7,000 $ 1,146,551 In October 2010, the General Fund loaned $333,050 to the Golf Course Fund to purchase new golf carts. In September 2013, the General Fund loaned $1,565,000 to the Golf Course Fund to pay off the Series 2003 Recreational Revenue Refunding Bonds. In September 2014, the General Fund loaned $630,000 to the Golf Course Fund for a new irrigation system. The amount reported as due from the Golf Course Fund is the current portion of the scheduled payments due to the General Fund in fiscal year 2015. The remaining amount due from the Golf Course Fund is reported as an interfund advance. The amounts due from the Fleet Internal Service Fund and the Nonmajor Governmental Funds represent short-term cash loans that will be repaid within the next twelve months. Receivable Fund Major Governmental Funds: Emergency Services District Fund Optional Sales Tax Fund Major Enterprise Fund: Solid Waste Disposal District Fund Payable Fund Amount General Fund General Fund $ 224,758 12,525 $ 237,283 General Fund $ 89,468 Internal Service Fund: Self Insurance Fund General Fund $ 1,596 Nonmajor Governmental Funds: Land Acquisition Bonds Fund Street Lighting Districts Fund Vero Lake Estates Fund East Gifford Stormwater Fund Total Nonmajor Governmental Funds General Fund General Fund General Fund General Fund $ 53,070 2,197 1,036 10 $ 56,313 Total: $ 384,660 Amounts due from the General Fund represent excess fees and payments of the constitutional officers remitted to various funds subsequent to September 30, 2014. 74 Indian River County, Florida ' Notes To Financial Statements Year Ended September 30, 2014 NOTE 9 - INTERFUND BALANCES - Continued Interfund advances at September 30, 2014, consisted of the following: Receivable Fund Payable Fund Amount General Fund Golf Course Fund $ 877,237 This amount is considered a long-term advance between major funds expected to be paid over the course of several years. This amount has been presented as nonspendable on the General Fund balance sheet. NOTE 10 - INTERFUND TRANSFERS 1 Interfund transfers for the year ended September 30, 2014, consisted of the following: I Transfers In: Secondary Roads Nonmajor Internal General Construction Transportation Governmental Utilities Service Transfers Out: Fund Fund Fund Funds Fund Funds Total I General Fund S $ S 7,657,704 S 144,391 S S 35,848 S 7,837,943 Impact Fees Fund 116,586 - - 34,830 - 151,416 I Transportation Fund' 258,613 125,000 383,613 Emergency Services District Fund 428,081 428,081 Optional Sales Tax Fund 834.674 - - 183,393 - 1,018,067 I Nonmajor Governmental Funds 316,810 109,050 425.860 Solid Waste Disposal District - - - 75,414 75,414 I Internal Service Fund 8,512 8.512 Total $ 1,704,663 $ 258,613 $ 7,657,704 S 471,664 S 75,414 S 160,848 S 10,328,906 ITransfers are used for the following purposes: 1) use unrestricted general fund revenues to finance transportation activities which must be accounted for in a special revenue fund, 2) use unrestricted 1 general fund revenues for beach restoration activities which must be accounted for in another fund, 3) provide matching funds for grants, 4) move revenues from the fund that state law requires to collect them to the fund that state law requires to expend them, 5) use transportation fund revenues to offset Ivehicle maintenance costs accounted for in the fleet internal service fund, 6) to account for transfers of capital assets between two enterprise funds, 7) use unrestricted general fund revenues to offset a portion of salaries and benefits expenses for an employee accounted for in the health insurance fund, 8) to use I general fund and capital project fund revenues for improvements to the Historic Dodgertown facility, and 9) to reimburse the general fund from the self-insurance fund for repairs at the shooting range, and I 10) to account for reimbursement of street paving costs between the transportation and secondary roads construction funds. 1 1 75 Indian River County, Florida Notes To Financial Statements Year Ended September 30, 2014 NOTE 11— DUE FROM OTHER GOVERNMENTS Governmental Funds On November 18, 2008, the Board entered into a locally funded agreement with the Florida Department of Transportation (FDOT) to advance the six-laning of State Road 60 from 82nd Avenue to I-95 (Segment Two). The agreement obligated the Board to pay $14,429,754 to the FDOT. Payment was made in November 2008 to the FDOT. Funding was from the Optional Sales Tax Fund. Reimbursement by the FDOT for Segment Two will be in ten quarterly installments over a three-year period which began in July 2011. Repayments to the Board will include principal and any accumulated interest earnings that have not been used for supplemental costs of the project. Optional Sales Tax Fund Segment Two Amount Advance Funded $ 14,429,754 Less: Reimbursements received as of 9/30/2014 (11,714,877) Balance Due from FDOT SR60 Agreement 2,714,877 Additional Funds Due from other governments 2,109,312 Total Due from other governments $ 4,824,189 NOTE 12 — ACCOUNTS PAYABLE Payables Payables at September 30, 2014, were as follows: Governmental Activities: General Impact Fees Secondary Roads Construction Transportation Emergency Services Optional Sales Tax Other governmental Total Governmental Activities Vendors $ 1,319,558 $ 1,325,559 536,329 302,621 129,983 452,272 818,686 $ 4,885,008 $ Salaries and Benefits Total Payables 1,749,589 2,366 6,964 181,303 520,285 55,798 $ 3,069,147 1,327,925 543,293 483,924 650,268 452,272 874,484 2,516,305 $ 7,401,313 Business -Type Activities Payable from current assets. Solid Waste $ 879,039 $ Golf Course 2,756 Utilities 1,819,698 Building 31,805 Payable from restricted assets: Utilities 23,398 Total Business -Type Activities $ 2,756,696 $ 76 14,175 $ 893,214 10,629 13,385 191,024 2,010,722 32,436 64,241 23,398 248,264 $ 3,004,960 Indian River County, Florida Notes To Financial Statements Year Ended September 30, 2014 NOTE 12 — ACCOUNTS PAYABLE - Continued The County has not engaged in any short-term debt activity during fiscal year 2014 other than that listed in Note 9. Due To Other Governments — Governmental Activities On August 21, 2012, the County approved a 5 -year payment plan agreement with the State of Florida to pay back $790,434 in disputed Medicaid billings. Monthly payments began on October 5, 2012. The County recorded the repayment agreement as a liability, Due to Other Governments, in the government - wide Statement of Net Position; and at September 30, 2014, the amount due to the State of Florida is $474,260. NOTE 13 - LONG-TERM LIABILITIES A. Changes in Long -Term Liabilities Long-term liability activity for the year ended September 30, 2014, was as follows: Governmental Activities: Bonds payable. Limited General Obligation Bonds - Series 2006 Spring Training Facility Revenue Bonds - Series 2001 Subtotal Add. Unamortized bonds premium Total bonds payable Other liabilities: Pollution remediation Claims payable Due to other governments -Medicaid Compensated absences Total other liabilities Beginning Balance $ 29,265,000 $ 8,145,000 37,410,000 722,489 38,132.489 Ending Additions Retirements Balance Due Within One Year - $ 3,255,000 $ 26,010,000 $ 3,390,000 445,000 7,700,000 470,000 3,700,000 93,224 33,710,000 3,860,000 629,265 - 3,793,224 34,339,265 3,860,000 2,727,400 - 55,600 2,671,800 8,074,000 16,860,869 16,708,324 8,226,545 632,342 - 158,082 474,260 11,304,749 5.746.903 6,423,032 10,628,620 22,738,491 22,607.772 23.345.038 22.001.225 114,480 3,181,891 158,087 5,682,955 9.137.413 Governmental activities long-term liabilities $ 60.870.980 $ 22,607,772 $ 27,138.262 $ 56.340.490 $ 12,997,413 Business -type Activities: Bonds payable Water & Sewer Refunding Revenue Bonds - Series 2005 V $ 17,480,000 $ Series 2009 23.085.000 Subtotal 40,565,000 Add. Unamortized bonds premium 2,455,793 Total bonds payable 43,020,793 Other liabilities: Landfill closure and maintenance costs 11,011,736 Pollution remediation 10,500 Compensated absences 814,632 Total other liabilities 498,000 1,000 659,389 11,836,868 1,158,389 Business -type activities long-term liabilities $ 54,857,661 $ 1,158,389 $ 77 1.605.000 $ 1,745,000 3,350,000 236,904 3,586.904 620,464 620,464 4,207,368 $ 15,875.000 $ 1,670,000 21,340,000 1,815,000 37,215,000 3,485,000 2.218, 889 - 39,433.889 3.485.000 11,509,736 11,500 5,500 853,557 586,624 12,374,793 592,124 51,808,682 $ 4,077,124 Indian River County, Florida Notes To Financial Statements Year Ended September 30, 2014 NOTE 13 - LONG-TERM LIABILITIES - Continued B. Primary Government Governmental Activities Annual Debt Service Payments - Governmental Activities The annual debt service payments for bonds outstanding at September 30, 2014, are as follows: Fiscal Year Ending September 30 2015 2016 2017 2018 2019 2020-2024 2025-2029 2030-2031 Total Less: Current portion Add: Unamortized bond premium Total Limited General Obligation Bonds Series 2006 Principal $ 3,390,000 3,545,000 3,705,000 3,890,000 4,085,000 7,395,000 26,010,000 3,390,000 629,265 Interest $ 1,204,712 1,035,212 893,413 745,212 550,712 478,426 Spring Training Facility Revenue Bonds Series 2001 Principal Interest $ 470,000 495,000 520,000 550,000 585,000 2,230,000 1,960,000 890,000 $ 394,713 370,037 344,050 316,750 287,875 1,007,787 525,750 66,250 4,907,687 7,700,000 3,313,212 470,000 $ 23,249,265 $ 4,907,687 $ 7,230,000 $ 3,313,212 78 Indian River County, Florida Notes To Financial Statements Year Ended September 30, 2014 NOTE 13 - LONG-TERM LIABILITIES - Continued B. Primary Government - Continued Limited General Obligation Bonds Purpose — On July 6, 2006, the County issued $48,600,000 of Limited General Obligation Bonds, Series 2006. The issuance of the Series 2006 bonds was approved by a majority of votes cast in a bond referendum held on November 2, 2004, by the qualified electors of the County. The referendum authorized a total of $50,000,000 aggregate principal amount of limited general obligation bonds. The proceeds of this issue will provide funds to acquire interest in lands to protect water resources and/or drinking water sources, environmentally sensitive lands, historic sites, and/or agricultural lands together with the necessary preservation, restoration, remediation and reclamation activities to preserve, protect, or enhance such property. Pledge of revenues — The principal and interest on the bonds are payable from ad valorem taxes not exceeding '/2 mil and having a maturity not exceeding fifteen years, which are levied by the County upon the taxable real and personal property of the County. Bonds Issued - At September 30, 2014, Limited General Obligation Bonds consisted of the following: Description Limited General Obligation Bonds, Series 2006 Interest Outstanding at Rates and September 30, Date Maturity Issue 2014 4.00%-5.00% 1/1 and 7/1 2021 $ 48,600,000 $ 26,010,000 Optional Redemption — The Limited General Obligation Bonds, Series 2006, maturing on or after July 1, 2017, are subject to redemption prior to maturity, at the option of the County on and after July 1, 2016, in whole or in part, at any time, on any date at a redemption price of 100% of the principal amount thereof, together with accrued interest thereon to the redemption date. Spring Training Facility Revenue Bonds Purpose - On August 15, 2001, the County issued $16,810,000 of Spring Training Facility Revenue Bonds, Series 2001. The Series 2001 bonds are being issued by the County to provide funds, together with other available funds, to (1) finance a portion of the cost of acquisition and expansion of a spring training facility currently known as "Historic Dodgertown"; (2) pay a premium for a municipal bond insurance policy and a debt service reserve account surety bond, and (3) pay certain costs and expenses incurred in connection with the issuance of the Series 2001 bonds. 79 1 Indian River County, Florida Notes To Financial Statements Year Ended September 30, 2014 NOTE 13 - LONG-TERM LIABILITIES - Continued B. Primary Government - Continued Spring Training Facility Revenue Bonds - Continued Pledge of Revenues - The principal and interest on the Series 2001 bonds will be payable from and secured by a first lien upon and pledge of the following, together with any investment income realized on any funds held under the Resolution, except the Cost of Issuance Account and the Rebate Fund: 1. Payments received by the County from the State of Florida pursuant to Section 212.20, Florida Statutes; and 2. The Fourth Cent Tourist Development Tax levied by the County in Ordinance No. 2000-029, enacted pursuant to Section 125.0104(3)(1), Florida Statutes; and 3. Eighty-six percent (86%) of the Local Government Half -Cent Sales Tax distributed to the County, pursuant to Chapter 218, Part VI, Florida Statutes. The foregoing are collectively referred to herein as the "pledged revenues". These revenue streams are pledged for the remaining term of the bonds and are listed on Schedule 25 in the statistical section. The Fourth Cent Tourist Development Tax and the Local Government Half -Cent Sales Tax pledged to P P g the payment of debt service on the Series 2001 bonds are automatically released as a pledged revenue for the Series 2001 bonds immediately following the April 1, 2021 principal payment on the Series 2001 bonds. The current principal and interest payments of $863,075 represent nine percent of total pledged El revenues. All three revenue sources totaled $9,199,278 for the current fiscal year. The County applied 100% of the state subsidy, 76% of the Fourth -Cent Tourist Tax, and none of the Half -Cent Sales Tax to the debt service payments. The total principal and interest remaining to be paid on the bonds isii $11,013,212. Bonds Issued - At September 30, 2014, Spring Training Facility Revenue Bonds consisted of the following: Interest Outstanding at Rates and September 30, Description Date Maturity Issue 2014 Spring Training Facility Revenue 3.30%-5.25% Bonds, Series 2001 4/1 and 10/1 2031 $ 16,810,000 $ 7,700,000 80 El I Indian River County, Florida Notes To Financial Statements Year Ended September 30, 2014 NOTE 13 - LONG-TERM LIABILITIES - Continued B. Primary Government - Continued Spring Training Facility Revenue Bonds - Continued Optional Redemption - The Series 2001 bonds maturing on or after April 1, 2012, were subject to redemption at the option of the County in whole or in part, on April 1, 2011, or on any date thereafter at par plus accrued interest and plus a premium ranging between 0% to 1% depending on the year of the redemption. Remaining Mandatory Redemption - The Series 2001 Term Bonds are subject to mandatory redemption prior to maturity, by lot, at par plus accrued interest, according to the following schedule: Term Bonds due April 1, 2015 Date Principal Amount April 1, 2015 $ 470,000 Term Bonds due April 1, 2017 Date Principal Amount April 1, 2016 $ 495,000 April 1, 2017 520,000 Term Bonds due April 1, 2021 Date Principal Amount April 1, 2018 $ 550,000 April 1, 2019 585,000 April 1, 2020 615,000 April 1, 2021 650,000 Term Bonds due April 1, 2027 Date Principal Amount April 1, 2022 $ 305,000 April 1, 2023 320,000 April 1, 2024 340,000 April 1, 2025 355,000 April 1, 2026 375,000 April 1, 2027 390,000 Term Bonds due April 1, 2031 Date Principal Amount April 1, 2028 $ 410,000 April 1, 2029 430,000 April 1, 2030 455,000 April 1, 2031 435,000 81 Indian River County, Florida Notes To Financial Statements Year Ended September 30, 2014 NOTE 13 - LONG-TERM LIABILITIES - Continued B. Primary Government - Continued Business -type Activities Annual Debt Service Payments — Business -type Activities The annual debt service payments for bonds outstanding at September 30, 2014 are as follows: Fiscal Year Ending September 30 2015 2016 2017 2018 2019 2020-2024 Total Less: Current portion Add: Unamortized bond premium Total Water and Sewer Revenue Refunding Bonds Series 2005 Principal Interest $ 1,670,000 1,750,000 1,840,000 1,930,000 2,025,000 6,660,000 $ 736,450 652,950 565,450 473,450 376,950 554,850 15,875,000 3,360,100 1,670,000 Water and Sewer Revenue Refunding Bonds Series 2009 Principal $ 1,815,000 1,905,000 2,000,000 2,100,000 2,205,000 11,315,000 21,340,000 Interest $ 1,067,000 976,250 881,000 781,000 676,000 1,612,250 5,993,500 1,815,000 487,304 1,731,585 $ 14,692,304 $ 3,360,100 $ 21,256,585 $ 5,993,500 82 El 1 Indian River County, Florida Notes To Financial Statements Year Ended September 30, 2014 NOTE 13 - LONG-TERM LIABILITIES - Continued B. Primary Government - Continued Water and Sewer Revenue Refunding Bonds, Series 2005 Purpose - The Series 2005 bonds were issued to defease $31,680,000 of the County's outstanding Water and Sewer Revenue Bonds, Series 1996. These bonds were issued by the County to provide funds, together with $5,000,000, to retire 95 percent of the 1996 Series and to pay for all bond issuance costs. The September 1, 2005 and 2006 principal installments were not subject to early call and consequently paid at their respective maturity dates. The 1996 bonds were issued to acquire an existing water and sewer facility, as well as for capital improvements to the existing system. The aggregate difference in debt service between the Series 1996 ($40,585,193) and Series 2005 ($39,619,193) is $966,000. The net economic gain, which included shortening the term of the bonds by four years and lowering average annual debt service by $242,000, was $2,944,661 and is amortized over the life of the bonds. The unamortized balance of the deferred amount on the refunding at September 30, 2014 is $1,344,917 and is reflected as a deferred outflow of resources on the Statement of Net Position. Pledge of Revenues - The revenue bonds are collateralized, for the remaining term of the bonds, by a pledge of all net revenues derived from the operation of the system, certain surcharges, and special assessments. Annual principal and interest payments of $2,405,650 represent approximately seventeen percent of net revenues of $13,924,642 of the utility system. The total principal and interest remaining to be paid on the bonds is $19,235,100. Rate Covenant — Net revenues shall be sufficient to pay 100% of the reserve account requirement and 120% of the current year's principal and interest payment. Bonds Issued - At September 30, 2014, the revenue bonds consisted of the following: Description Interest Outstanding at Rates and September 30, Date Maturity Issue 2014 Water and Sewer 3-5% Revenue Refunding Bonds, 3/1 and 9/1 2022 $ 27,675,000 $ 15,875,000 Series 2005 83 Indian River County, Florida Notes To Financial\Statements Year Ended September 30, 2014 NOTE 13 - LONG-TERM LIABILITIES - Continued B. Primary Government - Continued Water and Sewer Revenue Refunding Bonds, Series 2005 - Continued Outstanding In -Substance Defeased Debt - The proceeds from the refunding were invested in federal securities and were placed in an escrow account with Bank of New York/Mellon. All of the defeased bonds ($31,680,000) were called on September 1, 2006 at 102% of the outstanding principal amount. Optional Redemption - The Series 2005 bonds maturing after September 1, 2015, are subject to redemption by the County on or after September 1, 2015, in whole or in part, at par, plus accrued interest to date of redemption. Water and Sewer Revenue Refunding Bonds, Series 2009 Purpose - The Series 2009 bonds were issued to refund and redeem on September 11, 2009, $28,270,000 of the County's outstanding Water and Sewer Revenue Bonds, Series 1993A. The refunding excluded debt service payments due September 1, 2010 and 2011, which were consequently paid at their respective maturity date. The aggregate difference in debt service between the Series 1993A ($80,434,415) and Series 2009 ($78,755,772) is $1,678,643. The net economic gain, which lowered average annual debt service by $126,000, was $1,368,427 and is amortized over the life of the bonds. The unamortized balance of the deferred amount on the refunding at September 30, 2014 is $900,881 and is reflected as a deferred outflow of resources on the Statement of Net Position. Pledge of Revenues — The revenue bonds are collateralized, for the remaining term of the bonds, by a pledge of all net revenues derived from the operation of the system, certain surcharges, and special assessments. The principal and interest payments of $2,881,800 represent approximately twenty one percent of net revenues of $13,924,642 of the utility system. The total principal and interest remaining to be paid on the bonds is $27,333,500. Rate Covenant — Net revenues shall be sufficient to pay 100% of the reserve account requirement and 120% of the current year's principal and interest payment. 84 Indian River County, Florida Notes To Financial Statements Year Ended September 30, 2014 NOTE 13 - LONG-TERM LIABILITIES - Continued B. Primary Government - Continued Water and Sewer Revenue Refunding Bonds. Series 2009 - Continued Bonds Issued - At September 30, 2014, the revenue bonds consisted of the following: Description Interest Outstanding at Rates and September 30, Date Maturity Issue 2014 Water and Sewer 4-5% Revenue Refunding Bonds, 3/1 and 9/1 2024 $ 26,370,000 $ 21,340,000 Series 2009 Outstanding In -Substance Defeased Debt - The proceeds from the refunding were invested in federal securities and were placed in an escrow account with Bank of New York/Mellon. All of the defeased bonds ($28,270,000) were called on September 1, 2009 at 101% of the outstanding principal amount. Optional Redemption - The Series 2009 bonds maturing on or prior to September 1, 2019, are not subject to redemption prior to their respective dates of maturity. The Series 2009 bonds stated to mature after September 1, 2019, are subject to redemption at the option of the County in whole or, from time to time, in part on September 1, 2019, at the redemption price of the principal amount to be redeemed, plus accrued interest to the date of redemption. C. Compensated Absences For the governmental activities compensated absences liability, the general fund normally liquidates 72 percent, and the Transportation and Emergency Services District funds normally liquidate 7 percent and 20 percent, respectively. The remaining 1 percent is liquidated by other governmental and internal service funds. NOTE 14 - PROVISION FOR CLOSURE COSTS Current regulations of the U.S. Environmental Protection Agency (EPA) and the Florida Department of Environmental Protection (FDEP) require the Solid Waste Disposal District (SWDD) to place a final cover on closed landfill areas, and to maintain those areas for up to thirty years after closure. The SWDD annually obtains updated and revised estimates of total future closure and post -closure costs from its consulting engineers. The SWDD recognizes the expenses associated with the final closure and post -closure maintenance of the landfill areas over the active life of those areas. The provision for closure costs reported in the financial statements as operating expense represents the portion of these estimated future outlays which are allocable to the current year based on the amount of capacity used. 85 Indian River County, Florida Notes To Financial Statements Year Ended September 30, 2014 NOTE 14 - PROVISION FOR CLOSURE COSTS - Continued The total unrecognized closure and post -closure costs are approximately $3.1 million. These costs will be recognized in future periods as the remaining capacity is filled. The County's policy is to fund 100% of the current year's allocation (based upon the consulting engineers' report) of both closure and post - closure care. Required closure and post -closure sub -accounts: Capacity Estimated Used Closing Amount Closure Costs Class I - Segments I and II 61% 2026 $ 7,401,947 Construction and Demolition - Cell I 90% 2026 1,154,866 Post -closure Costs Class I - Segments I and II N/A N/A 2,763,435 Construction and Demolition - Cell I N/A N/A 189,488 Total account balance at 9/30/14: $ 11,509,736 All amounts recognized are based on what it would cost to perform all closure and post -closure functions in current dollars. Actual costs may be different due to inflation, deflation, changes in technology, or changes in laws and regulations. The SWDD is required by FDEP to annually show proof of ability to finance closure and post -closure costs. The SWDD is making annual deposits to a closure and post -closure cost escrow account to provide for the financing of future closure -related expenses. At September 30, 2014, $11,448,484 was on deposit at the Florida Local Government Investment Trust and $61,252 was on deposit in the County's Operating account. A summary of changes in the landfill closure liability account is as follows: Balance Balance 10/1/2013 Deposits Withdrawals 09/30/14 Closure and long-term care costs $ 11,011,736 $ 498,000 $ $ 11,509,736 Of the $11,509,736 liability for closure and long-term care costs, management estimates that no funds will be due and payable within one year. 86 Indian River County, Florida Notes To Financial Statements Year Ended September 30, 2014 NOTE 15 — POLLUTION REMEDIATION In accordance with GASB Statement 49, Accounting and Financial Reporting for Pollution Remediation Obligations, a consultant evaluated four sites to assess pollution remediation liabilities. The consultant calculated for each site an expected value (EV) estimate for pollution remediation based on three plausible mitigation scenarios. An obligating event occurred at each of the following four sites requiring the County (using the consultant's services) to attempt to accrue a liability for pollution remediation. The liability totaled $2,683,300 at September 30, 2014 for all four sites. The pollution remediation obligation is an estimate and subject to changes resulting from price increases and reductions, technology, and changes in applicable laws or regulations. There are no estimated recoveries that would reduce the liability. Governmental Activities: 1) South Gifford Road closed landfill — The nature of the pollution remediation obligation is chlorinated solvent contamination. The consultant will conduct monitoring, bioremediation and reporting with the Florida Department of Environmental Protection (FDEP). The amount of the estimated year end liability is $2,640,000 and will be paid from the Optional Sales Tax Fund. 2) Old Administration Building — The nature of the pollution remediation obligation is closed underground storage tank contamination. The consultant will conduct monitoring and reporting with the FDEP. The amount of the estimated year end liability is $26,800 and will be paid from the General Fund. 3) Cattle dip site — The nature of the pollution remediation obligation is arsenic contamination. The consultant will conduct monitoring and assessment. The amount of the estimated year end liability is $5,000 and will be paid from the Impact Fees Fund. Total Governmental Activities liability: $2.671.800 Business -type Activities: 4) North County Reverse Osmosis plant — The nature of the pollution remediation obligation is groundwater inorganic contamination. The consultant will conduct monitoring and assessment. The amount of the estimated year end liability is $11,500 and will be paid from the County Utilities Fund. Total Business -type Activities liability: $11.500 87 Indian River County, Florida Notes To Financial Statements Year Ended September 30, 2014 NOTE 16 - PENSION PLANS Florida Retirement System Plan Description: The County's employees participate in the Florida Retirement System (FRS), a cost- sharing, multiple -employer public employee retirement system, administered by the Florida Department of Management Services. Effective July 1, 2011, the FRS became a contributory plan for all members, except DROP participants, whereby members contribute 3% and employers pay a rate based upon each member's employment class. Employer rates effective as of July 1, 2014 were as follows: regular class 7.37%, senior class 21.14%, special risk 19.82% and elected official class 43.24%. Employees elect participation in either the defined benefit plan (Pension Plan) or the defined contribution plan (Investment Plan). If the employee enrolled in the FRS prior to July 1, 2011, normal retirement is age 62 with 6 years of service or 30 years of service, regardless of age. If the employee enrolled in the FRS on or after July 1, 2011, normal retirement is age 65 with 8 years of service or 33 years of service, regardless of age. Under the Pension Plan, early retirement is available before reaching normal retirement age and will be subject to an early-retirement reduction of 5% for each year your age at retirement is under your normal retirement age. For those employees who elect participation in the Investment Plan rather than the Pension Plan, vesting occurs after one year of service. Participants have access to the full value of their vested account balance when they leave FRS employment, regardless of age. These participants receive a defined contribution for self-direction in an investment product with a third party administrator selected by the State Board of Administration. Retirement benefits are determined by age, years of service, the average of the highest 5 or 8 fiscal years of pay, membership class and the payment option selected at retirement. In addition to the above benefits, the FRS administers a Deferred Retirement Option Program (DROP). This program allows eligible employees to defer receipt of monthly retirement benefit payments while continuing employment with a FRS employer for , a period not to exceed five years after electing to participate. Deferred monthly benefits are held in the FRS Trust Fund and accrue interest. Florida Statutes Chapter 121, as may be amended from time to time by the state legislature, determines contribution rates for the various membership classes of the FRS. The FRS issues a publicly available financial report that includes financial statements, ten-year historical trend information and other required supplementary information. That report may be obtained by writing to the Florida Department of Management Services, Division of Retirement, Attention: Research and Education Section, P.O. Box 9000, Tallahassee, Florida 32315-9000, or from the website at www.dms.myflorida.com. 88 Indian River County, Florida Notes To Financial Statements Year Ended September 30, 2014 NOTE 16 - PENSION PLANS - Continued Florida Retirement System - Continued Funding Policy• The FRS has six classes of membership with descriptions and contribution rates in effect during the period ended September 30, 2014, as follows (contribution rates are in agreement with the actuarially determined rates): Regular Class - Members not qualifying for other classes. 7/1/2011 7/1/2012 7/1/2013 07/01/14 to 6/30/12. to 6/30/13 to 6/30/14 to 9/30/14 7.91% 8.18% 9.95% 10.37% Senior Management Service Class - Members of senior management who do not elect the optional annuity management program. 9.27% 9.30% 21.31% 24.14% Special Risk Class - Members employed as law enforcement officers, firefighters, or correctional officers and meet the criteria set to qualify for this class. 17.10% 17.90% 22.06% 22.82% Special Risk Administrative Support Class - Special risk members who are transferred or reassigned to non -special risk and meet the criteria. 9.04% 8.91% 38.96% 45.07% Elected County Officer's Class - Certain elected county officials. 14.14% 13.23% 36.03% 46.24% Deferred Retirement Option Program - Members who are eligible for normal retirement that have elected to participate in the deferred retirement option program. 4.42% 5.44% 12.84% 12.28% Contributions to the FRS for the fiscal years ended September 30, 2012, 2013, and 2014, were equal to 8.66%, 9.97%, and 12.70% of the annual covered payroll. Contributions to the FRS for the fiscal years ended September 30, 2012, 2013, and 2014 were $5,857,114, $6,678,184, and $8,597,157 respectively. Employee contributions for the fiscal years ended September 30, 2012, 2013, and 2014 were $1,789,315, $1,735,675, and $1,746,296 respectively. Both employer and employee contributions were equal to 100% of the required contribution for each year. 89 Indian River County, Florida Notes To Financial Statements Year Ended September 30, 2014 NOTE 17 — OTHER POSTEMPLOYMENT BENEFITS PLAN (OPEB) A. Plan Description On September 23, 2008, the Board of County Commissioners approved resolution number 2008-163, establishing an irrevocable trust (OPEB Trust) to separately identify assets accumulated to pay OPEB benefits for eligible retirees. The OPEB Trust includes the Board of County Commissioners and the five constitutional officers (Clerk of the Circuit Court and Comptroller, Property Appraiser, Sheriff, Supervisor of Elections, and Tax Collector). The resolution also established the Board of County Commissioners as trustees of the OPEB Trust and the authority for the trustees to amend the benefit provisions. The OPEB Trust is a single -employer defined benefit plan (OPEB Plan). The OPEB plan subsidizes (see the chart below) the cost of health care for employees hired prior to February 1, 2006 and their eligible dependents according to the provisions of the substantive plan (the plan as understood by the employer and plan members). Employees hired on or after February 1, 2006, will not be eligible for any subsidy, regardless of the years of service or Medicare eligibility. Active participants as well as retirees are subject to the same benefits and rules. Retired employees are permitted to remain covered under the Board's medical and life insurance plans as long as they pay a premium applicable to the coverage elected. This conforms to the minimum required of Florida governmental employers per Florida Statute 112.0801. The retiree has the option to continue with the Board group health plan or elect Medicare Advantage Plan. The implicit rate subsidy applies to health and life insurance coverage since the premiums charged are based upon a blending of younger active employees and older retired employees. Health insurance premiums, effective October 1, 2013 range from $400 for Medicare participants to $715 for family coverage. Life insurance is available to retirees at a flat rate of $.20 per $1000 of coverage (to a maximum of $20,000 until the age of 70). After 70, the maximum amount of life insurance is $10,000. The Board subsidizes the cost of the health premiums for each retiree based upon their years of service and employment date (as mentioned above); a 2% discount is given for each year of service based upon the following table: Retirement Date Years of Service Under Age 65 Medicare Eligible Before 01/01/04 N/A No subsidy 60% subsidy 01/01/04 - 10/01/04 Less than 15 years No subsidy 60% subsidy 01/01/04 - 10/01/04 15 or more years 2%/yr-max 40% 20% in addition to yrs of service - max 60% subsidy 10/01/04 - 01/31/09 Less than 15 years No subsidy 20% subsidy 10/01/04 - 01/31/09 15 or more years 2%/yr-max 40% 20% in addition to yrs of service - max 60% subsidy 02/01/09 and after Less than 15 years No subsidy No subsidy 02/01/09 and after 15 or more years 2%/yr-max 40% No subsidy 90 1 1 1 1 a 1 1 1 1 1 1 1 Indian River County, Florida Notes To Financial Statements Year Ended September 30, 2014 NOTE 17 — OTHER POSTEMPLOYMENT BENEFITS PLAN - Continued A. Plan Description - Continued The OPEB Trust financial statements are reported using the accrual basis of accounting and are included in the Indian River County Comprehensive Annual Financial Report (CAFR). Questions regarding the OPEB plan may be directed to the Finance Director. At October 1, 2013, the date of the latest actuarial valuation, plan participation consisted of: Active participants 1,382 Retired participants 429 1 Total participants 1.811 There are two classes of participants at October 1, 2013: Regular and senior management 1,141 g g Special risk 670 1 Total participants 1,811 The average employer's contribution was $2,051 per employee, approximately 4.6% of current payroll. Financial statements for the OPEB Trust are included in this report and can be found on pages 44-45. A separate, stand-alone financial report is not issued by the County. The OPEB Trust investments can be ' found in Note 4D and the Schedule of Funding Progress can be found on page 101. B. Funding Policy The Board of County Commissioners, in concert with the OPEB Board of Trustees, has the authority to establish and amend the funding policy of the OPEB Plan. The OPEB Trust is advance funded by the ' County. For the year ended September 30, 2014, the County contributed $3.43 million to the qualifying OPEB Trust. Plan members receiving benefits contributed $1.72 million, or approximately 50 percent of the total premiums. We anticipate that the OPEB liability will be liquidated in the following manner: General fund 49 percent, Transportation fund 7 percent, Emergency Services District fund 18 percent, enterprise funds 8 percent, internal service funds 16 percent, and the remaining 2 percent is by the other governmental and internal service funds. It is the County's policy to base future OPEB Trust contributions on the annual required contribution (ARC) in subsequent annual actuarial reports. Custodial and individual fund administrative fees are paid from the portfolio dividend and interest income. C. Annual OPEB Cost and Net OPEB Obligation The employer's contribution (i.e. annual cost or expense) to the County's OPEB Trust is based on the ARC calculation. The ARC is an amount actuarially determined in accordance with the parameters of GASB Statement No. 45. The ARC represents a level of funding that, if paid on an ongoing basis, is ' projected to cover the normal cost each year and amortize any unfunded actuarial liability over a period not to exceed 20 years. The following table shows the components of the County's annual cost for the current and two preceding years, the amount actually contributed, and the changes in the net obligation. 1 91 Indian River County, Florida Notes To Financial Statements Year Ended September 30, 2014 NOTE 17 — OTHER POSTEMPLOYMENT BENEFITS PLAN - Continued C. Annual OPEB Cost and Net OPEB Obligation - Continued Annual Required Contribution Interest on Net OPEB Obligation Adjustment to Annual Required Contribution Annual OPEB Cost (expense) Contributions (net of adjustments)* Change in Net OPEB Obligation Net OPEB Obligation — beginning of year Net OPEB Obligation — end of year Percentage of Annual OPEB Cost Contributed FY 2013/2014 $ 2,835,072 (18,036) 24,230 2,841,266 (3,336,027) (494,761) (300,606) $ (795,367) 117.41% FY 2012/2013 FY 2011/2012 $ 2,965,251 (20,909) 26,830 2,971,172 (2,950,097) 21,075 (321,681) $ (300,606) $ 2,828,452 (12,323) 14,075 2,830,204 (2,962,301) (132,097) (189,584) $ (321,681) 99.29% 104.67% *Retiree adjustments are comprised of the actual amount withdrawn from the Trust plus premiums collected and less claims paid. For fiscal year 2014, these adjustments amounted to ($90,852). For fiscal years 2013 and 2012, these adjustments totaled ($15,154) and $13,640 respectfully. D. Funded Status and Funding Progress As of October 1, 2013 (the most recent actuarial valuation date), the funded status of the plan was as follows: Actuarial accrued liability (AAL) Actuarial value of plan assets Unfunded actuarial accrued liability (UAAL) Funded ratio $ 35,745,213 $ 11,571,968 $ 24,173,245 32.37% Covered payroll (annual payroll of active employees covered by the plan) $ 61,615,728 UAAL as a percentage of covered payroll 39.23% Actuarial valuations of an ongoing plan involve estimates of the value of reported amounts and assumptions about the probability of occurrence of events into the future. Examples include assumptions about future employment, mortality, and the healthcare cost trend. Amounts determined regarding the funded status of the plan and the annual required contributions of the employer are subject to continual revision as actual results are compared with past expectations and new estimates are made about the future. The Schedule of Funding Progress and Schedule of Employer Contributions, presented as required supplementary information immediately following the County Notes to the Financial Statements (on page 101), presents multi-year trend information regarding liabilities, funding, and payroll. The data also reflects whether the actuarial value of the plan assets is increasing or decreasing over time relative to the actuarial accrued liabilities for benefits. This information includes the current (listed above) and past two actuarial valuations as well as six years of funding data. 92 Indian River County, Florida Notes To Financial Statements Year Ended September 30, 2014 NOTE 17 — OTHER POSTEMPLOYMENT BENEFITS PLAN - Continued E. Actuarial Methods and Assumptions Projections of benefits for financial reporting purposes are based on the benefits provided under terms of the substantive plan (the plan as understood by the employer and the plan members) in effect at the time of each valuation and on the pattern of sharing of costs between the employer and plan members to that point. The projection of benefits for financial reporting purposes does not explicitly incorporate the potential effects of legal or contractual funding limitations on the pattern of cost sharing between the employer and plan members in the future. Actuarial calculations reflect a long-term perspective. Consistent with that perspective, actuarial methods and assumptions used include techniques that are designed to reduce the effects of short-term volatility in actuarial accrued liabilities and the actuarial value of assets. The actuarial methods are: Actuarial cost method Amortization method Amortization period (closed) Asset valuation method The actuarial assumptions are: Investment rate of return Projected annual salaries increase Healthcare cost trend rate Inflation rate NOTE 18 - OPERATING LEASES Entry age normal cost method Level percent of payroll projected to grow 4% per year 14 years Market Value 6.0% 4.0%-9.47% 8.5% 3% (net administrative expenses) (dependent on years of service and age) (decreasing 1/2% each year & thereafter to the ultimate value of 5.28%) The County has entered into non -cancelable operating leases, both as lessor and lessee. Lease terms vary from 1 to 99 years. Lease revenues totaled $620,669 and lease expenditures totaled $295,668 for the year ended September 30, 2014. The County also leases other equipment and office facilities as both lessor and lessee on a month-to-month basis. A. Future Minimum Lease Receipts Year Amount 2015 5 626,153 2016 622,429 2017 613,113 2018 602,889 2019 621,023 2020-2024 2,805,324 2025-2029 1,037,328 2030-2034 450,507 2035-2038 108,800 Total future minimum lease receipts. $ 7,487,566 93 Indian River County, Florida Notes To Financial Statements Year Ended September 30, 2014 NOTE 18 - OPERATING LEASES — Continued A. Future Minimum Lease Receipts - Continued The property being leased is included in the statement of net position governmental activities and business -type activities columns and has a cost of $29,219,029 and a carrying value of $19,972,847. Current year depreciation on property being leased was $492,950. B. Future Minimum Lease Payments The following is a schedule of minimum future rentals to be paid by the County for various non- cancelable operating leases of office space, park land, and office equipment as of September 30, 2014: Year Amount 2015 $ 275,207 2016 225,281 2017 126,473 2018 48,909 2019 43,696 2020-2024 7,500 2025-2029 7,500 2030-2034 7,500 2035-2039 5,700 2040-2044 4,500 2045-2049 3,900 2050-2054 3,000 2055-2059 1,800 2060-2064 1,500 2065-2069 1,500 2070-2074 1,500 2075-2076 600 Total future minimum lease payments: $ 766,066 94 Indian River County, Florida Notes To Financial Statements Year Ended September 30, 2014 NOTE 19 - FUND BALANCE GASB Statement 54, Fund Balance Reporting and Governmental Funds Type Definitions, requires the fund balance for governmental funds to be reported in classifications that comprise a hierarchy based primarily on the extent to which the government is bound to honor constraints on the specific purposes for which amounts in those funds can be spent. A. Categories There are five categories of fund balance for governmental funds under Statement 54: Nonspendable — Amounts that cannot be spent because they are not in spendable form or are legally or contractually required to remain intact. Restricted — Use of these resources is based on the constraints imposed externally by creditors, grantors, contributors, or laws and regulations of other governments; or imposed by law through constitutional provisions or enabling legislation. Committed — Amounts whose use is constrained by the approval of a County ordinance by the Board of County Commissioners. This category also includes existing resources on hand to satisfy the obligations that arise from contractual obligations entered into by the Board of County Commissioners. Assigned — The Board of County Commissioners is the governing body authorized to assign fund balance amounts to be used for specific purposes. This assignment is done through the budget approval and amendment process. Amounts appropriated to eliminate a budgetary deficit in a subsequent year are reported in this category as well. Unassigned — Residual amounts in the general fund that do not meet any of the other fund balance classifications. B. Fund Balance Policy On September 21, 2010, the County approved a Fund Balance and Reserve Policy that set forth the following reserves of fund balance in the General, Transportation, and Emergency Services District Funds: Emergency/Disaster Relief Reserve — A balance of no less than 5% of budgeted operating expenditures for the current fiscal year will be reserved only for the purpose of responding to natural and man-made disasters. Disasters include hurricanes, tropical storms, floods, wildfires, or terrorist activities. These funds can only be used to respond and provide relief after such a disaster. Funds will be replenished over a five-year period after the completion of the recovery from the disaster. 95 Indian River County, Florida Notes To Financial Statements Year Ended September 30, 2014 NOTE 19 - FUND BALANCE — Continued B. Fund Balance Policy - Continued Budget Stabilization Reserve — A balance of no less than 5% of budgeted operating expenditures for the current fiscal year will be reserved only for the purpose of revenue declines or unfunded mandates from the state and federal governments. Funds utilized due to revenue declines will be replenished over a five-year period. Funds utilized for unfunded mandates or unanticipated expenditures cannot be used for more than a three-year period and must be replenished within five -years after the three-year period. At September 30, 2014, reserve amounts for those funds were: Budget Disaster Relief Stabilization Total General Fund $ 5,100,000 $ 5,100,000 $ 10,200,000 Transportation Fund 750,000 750,000 1,500,000 Emergency Services District Fund 1,400,000 1,400,000 2,800,000 Total $ 7,250,000 $ 7,250,000 $ 14,500,000 The General Fund reserves are included in the unassigned fund balance on the balance sheet. The Transportation Fund reserves are included in the assigned fund balance and the Emergency Services District Fund reserves are included in the restricted fund balance on the balance sheet. Emergency/Disaster Relief and Budget Stabilization Reserve amounts may only be revised by the Board of County Commissioners. Minimum Fund Balance - The approved fund balance policy dictates the County's attempt to maintain a minimum fund balance in the General, Transportation, and Emergency Services District funds of 20% of budgeted annual operating expenditures. The minimum fund balance level may be revised by the County Administrator or his designee. C. Spending Hierarchy For all governmental funds, when restricted, committed, assigned, and unassigned fund balances are combined in a fund, qualified expenditures are paid first from restricted or committed fund balance, as appropriate, then assigned and finally unassigned fund balances. 96 Indian River County, Florida Notes To Financial Statements Year Ended September 30, 2014 NOTE 20 - FUND BALANCE DEFICIT The following funds had a deficit in fund balance at September 30, 2014: Fund Deficit Nonmajor Governmental Funds: Metropolitan Planning Organization Fund $ 155,018 CDBG NSP3 Grant Fund 39,369 Total Deficit $ 194,387 The deficits for these two funds will be eliminated by grant proceeds in fiscal year 2015. NOTE 21 — NET POSITION A. Net Position Restricted by Enabling Legislation The government -wide statement of net position for the primary government reports $138,192,792 of restricted net position, of which $85,130,111 is restricted by enabling legislation. B. Restatement of Beginning Net Position Beginning net position for the governmental activities was restated due to the recording of accumulated depreciation not previously reported on capital assets. At October 1, 2013, this results in a decrease to beginning net position of $15,488,462. 97 Indian River County, Florida Notes To Financial Statements Year Ended September 30, 2014 NOTE 22 - RISK MANAGEMENT General Liability, Property, Worker's Compensation and Medical The County is exposed to various risks of loss related to torts, theft of, damage to and destruction of assets, errors or omissions, injuries to employees, and natural disasters. The County established a Self Insurance Fund (an internal service fund) to account for and finance its uninsured risk of loss. Under this program, the Self Insurance Fund provides coverage as follows: Worker's Compensation General Liability Auto Liability Property Damage Error or Omissions Annual Aggregate Liquor Liability 10/01/08 to 4/30/2011 $ 350,000 250,000 250,000 250,000 250,000 2,000,000 1,000,000 05/01/11 to 10/01/13 to 9/30/2013 9/30/2014 $ 350,000 200,000 200,000 200,000 200,000 2,000,000 1,000,000 $ 500,000 200,000 200,000 200,000 200,000 2,000,000 1,000,000 The County purchases excess insurance to cover claims in excess of the amounts listed above. There is a 5% deductible per location for property damages arising due to a hurricane under the reinsurance policy. All departments of the County participate in the program. Payments are made by various funds to the Self Insurance Fund based on past experience and actual estimates of the amounts needed to pay current year claims. The County has received three workers compensation reimbursements totaling $125,213 in fiscal year 2014. The County received three workers compensation reimbursements totaling $108,123 in fiscal year 2013 and one in fiscal year 2012 totaling $134,020. The County is also self-insured for medical claims covering employees and their eligible dependents. As required by Section 112.081, Florida Statutes, retirees and their eligible dependents are provided the same health care coverage as is offered to active employees; however, the retirees are responsible for payment of the premiums. Medical claims are paid from premiums contributed by employees, retirees and by the County. Premiums and contributions are determined by projected claims based on historical and actuarial experience. The self insurance plan assumes all risk for claims, other than worker's compensation, up to $250,000 per occurrence. The County has purchased a reinsurance policy to cover claims in excess of these limits. There were six medical claim reimbursements in excess of the $250,000 limit for fiscal year 2014 totaling $335,641. In fiscal year 2013, there were six totaling $285,689 and in fiscal year 2012, there were none. The claims liability of $8,226,545 reported at September 30, 2014, is based on the requirements of generally accepted governmental accounting standards, which require that a liability for claims be reported if information prior to the issuance of the financial statements indicates that it is probable that a liability has been incurred at the date of the financial statements, and the amount of the loss can be reasonably estimated. Estimates for claims incurred but not reported are actuarially determined and recorded. Based on the actuary's report, $3,181,891 will be liquidated over the next twelve months. 98 Indian River County, Florida Notes To Financial Statements Year Ended September 30, 2014 NOTE 22 - RISK MANAGEMENT - Continued General Liability, Property, Worker's Compensation and Medical - Continued Changes in the fund's claim liability amount during the current and prior three fiscal years are as follows: Balance at Claims Balance Fiscal Year and Changes Claim at Fiscal Beginning in Estimates Payments Year End 2010-2011 $ 7,899,000 $ 12,901,425 $ (12,923,425) $ 7,877,000 2011-2012 7,877,000 13,967,831 (13,770,831) 8,074,000 2012-2013 8,074,000 14,396,726 (14,396,726) 8,074,000 2013-2014 8,074,000 16,860,869 (16,708,324) 8,226,545 Included in the charges to other funds is an amount to fund future catastrophic losses not actuarially determined and at September 30, 2014, unrestricted net position of $23,730,587 has been designated for this purpose. The County has elected to accrue the larger of the discounted liability or undiscounted liability. At September 30, 2014, the undiscounted liability was the greater of the two amounts. The discount rate used in the calculation was 2.5 percent. NOTE 23 - COMMITMENTS AND CONTINGENCIES A. Litigation Various suits and claims are currently pending against the County. It is impossible for the County to accurately quantify the exposure involved given the jury's latitude in assessing compensatory and punitive damages, and the court's latitude in awarding attorney's fees. The County intends to vigorously defend against these lawsuits and believes it has a good chance of prevailing on their merits. The County is contingently liable with respect to lawsuits and other claims incidental to the ordinary course of its operations. In the opinion of management and based on the advice of legal counsel, the ultimate disposition of lawsuits will not have a material adverse effect on the financial position of the County. B. Contracts and Other Commitments The County has various contracts and commitments outstanding at September 30, 2014. In the General Fund, contracts are for janitorial services, beach park landscape and custodial maintenance, legislative consulting services and external auditing services. In the Special Revenue Funds, contracts are for the Sector 3 Dune Repair -Post Sandy, Oslo Road Widening from 58th Avenue to 43rd Avenue (Phase III), 66th Avenue Roadway Improvements, Old Dixie Highway Resurfacing, as well as a variety of other and paving and drainage projects. 99 Indian River County, Florida Notes To Financial Statements Year Ended September 30, 2014 NOTE 23 - COMMITMENTS AND CONTINGENCIES - Continued B. Contracts and Other Commitments - Continued In the Capital Projects Fund, contracts are for the South County Regional Park Intergenerational Recreation Facility, PC South Algal Turf Scrubber Nutrient Recovery System, 12th Street and 27th Avenue intersection improvements, and several sidewalk and road improvement projects throughout the County. In the Enterprise Funds, contracts are for the Reverse Osmosis Lime Slurry Injection Project, the West Regional Wastewater Treatment Facility Anaerobic Tanks Odor Control System, Golf Course Dunes irrigation project, South County Brine Disposal project and various other water and sewer projects. A summary of these projects at September 30, 2014, is as follows: General Special Revenue Capital Projects Enterprise Internal Service Total C. Grants Total Contract Price $ 1,022,490 $ 42,450,585 7,055,871 12,779,653 30,000 $ 63,338,599 $ Total Paid as of September 30, 2014 (414,497) $ (27,854,250) (5,965,418) (8,438,093) (42,672,258) $ Remaining Balance at September 30, 2014 607,993 14,596,335 1,090,453 4,341,560 30,000 20,666,341 Amounts received or receivable from grantor agencies are subject to audit and adjustment by grantor agencies. If any expenditures are disallowed as a result of these audits, the claims for reimbursement to the grantor agency would become a liability of the County. In the opinion of management, any such adjustments would not be significant. NOTE 24 — SUBSEQUENT EVENTS On February 17, 2015, the County approved appropriating $2.7 million from General Fund reserves to fund legal action against the All Aboard Florida railway project. Funding is anticipated to be $0.5 million in fiscal year 2015 and $1.1 million in fiscal years 2016 and 2017. 100 Indian River County, Florida Required Supplementary Information For the Year Ended September 30, 2014 Other Postemployment Benefits Plan Schedule of Funding Progress UAAL as a Actuarial Actuarial Accrued Percentage of Value of Liability (AAL)- Unfunded AAL Covered Valuation Assets Entry Age (UAAL) Funded Ratio Covered Payroll Payroll Date (a) (b) (b -a) (a/b) ( c) ((b-a)/c) 10/01/2007* $ - $ 29,098,337 $ 29,098,337 0 00% $ 64,841,779 44 88% 10/01/2009 $ 3,690,592 $ 32,456,186 $ 28,765,594 11.37% $ 70,558,251 40.77% 10/01/2011 $ 6,955,356 $ 33,877,613 $ 26,922,257 20.53% $ 62,739,616 42.91% 10/01/2013 $ 11,571,968 $ 35,745,213 $ 24,173,245 32.37% $ 61,615,728 39.23% * First year of Indian River County Other Postemployment Benefits Trust (IRCOT) Schedule of Employer Contributions Fiscal Year OPEB Annual Amount Percentage Ending Cost Contributed Contributed 9/30/2012 $ 2,830,204 $ 2,962,301 104 67% 9/30/2013 $ 2,971,172 $ 2,950,097 99.29% 9/30/2014 $ 2,841,266 $ 3,336,027 117 41% In the current fiscal year there have not been any factors; such as changes in benefit provisions. the size or composition of the population covered by the plan or the actuarial methods and assumptions used, that would significantly affect the identification of trends in the amounts reported. See Note 17 for more information on the IRCOT 101 En Pen NM NEE EMI MN SIM ME MS EMI MI ME OM Egil EMI Nell WM ME N O COMBINING AND INDIVIDUAL FUND STATEMENTS AND SCHEDULES ia4w.P,:w,sh`3a:��..eC;k11:: 103 NONMAJOR GOVERNMENTAL FUNDS SPECIAL REVENUE FUNDS Court Facilities- To account for the court facility surcharge, additional court costs, the additional recording fee for court technology, and improvements made to court facilities. Section 8 Rental. Assistance- To account for the provision of rental assistance for low income housing. Financing is provided by grants from the U.S. Department of Housing and Urban Development. Special Law Enforcement- To account for the expenditures of providing law enforcement equipment. Financing is provided by confiscation of monies and property in accordance with Section 932.704 of the Florida Statutes. Tree Ordinance Fines- To account for fines assessed against individuals for illegal removal of protected trees. Funds are used for park improvements. Tourist Development- To account for the proceeds from the levy of a local option Tourist Development tax. Funds are used to attract tourism trade and for the benefit of County residents. 911 Surcharge- To account for the receipt of the 911 surcharge on all telephone bills of the County. Monies are used to pay the operating costs of the 911 Emergency Center. Drug Abuse- To account for the collection of fines on criminal drug cases. Monies are used for drug prevention and education programs. State Housing Initiatives Partnership - To account for State funds distributed under the State Housing Initiatives Partnership Act. The purpose of this program is to provide for the creation and preservation of affordable housing. Funds are provided by the documentary stamp taxes. 104 Metropolitan Planning Organization- To account for expenditures incurred for planning community transportation in the County. Financing is provided by grants. Multi -Jurisdictional Law Enforcement- To account for expenditures incurred in connection with the cooperative drug enforcement task force established by the County, the City of Vero Beach and the City of Sebastian. Funds are provided by grants and program generated income. Native Uplands Land Acquisition - Beach Restoration- CDBG Neighborhood Stabilization Program - To account for expenditures related to the acquisition of native habitat preserve areas and for the management of such lands. Funding is provided by developers of property who pay to mitigate native uplands destruction where native upland plant communities will be destroyed. To account for the expenditure of funds to preserve and improve County beaches. Funds are provided by the levy of a local option tourist development tax. To account for the proceeds from the Community Development Block Grant. The purpose of this grant is to provide neighborhood stabilization through resale and rental of housing units purchased by the grant funds. Florida Boating Improvement Program- To account for boat registration fees which may be used for providing recreational channel marking, public launching facilities, and other boating -related activities. Library Bequests - Disabled Access Program- Federal/State Grants - Traffic Education Program - To account for bequests which may be used for improvements to the Indian River County Libraries. To account for fines assessed against individuals for illegal use of handicapped parking spaces. To account for revenues and expenditures of various grants from Federal and State agencies. To account for the proceeds of an additional $3 add-on to traffic fines authorized by County Ordinance. Proceeds must be used for traffic education programs. 105 Land Acquisition - East Gifford Stormwater- Vero Lake Estates- Dodgertown Reserve - Clerk Special Revenue - Sheriff Special Revenue - Supervisor of Elections Special Revenue - Street Lighting Districts- CDBG Neighborhood Stabilization Program 3 Grant - To account for expenditures incurred in the purchase of environmentally sensitive land, preservation of water sources, historic sites and agricultural lands. Financing is provided by bond proceeds and state grants. To account for expenditures of funds for stormwater improvements in the East Gifford Watershed. Funds are provided by non -ad valorem taxes. To account for the expenditure of funds to improve roads in the Vero Lake Estates subdivision. Funds are provided by the levying of special assessments. To provide improvements to the Historic Dodgertown facility per existing lease agreement between the County and current tenant. Funds are provided by the half cent sales tax and transfers from the optional sales tax fund. To account for the proceeds from a special recording fee to be used for computer linkage and modernizing the Clerk of the Circuit Court and Comptroller's public records system. To account for the expenditure of grants, fines, and restricted revenues received by the Sheriff. To account for revenues and expenditures from state grants for voter education and pollworker activities. To account for the costs of providing street lights. Financing is provided by the levying of special assessments. To account for the proceeds from the Community Development Block Neighborhood Stabilization Program 3 Grant. The purpose of this grant is to provide neighborhood stabilization through resale of housing units purchased with the grant funds. 106 Spring Training Facility Bonds - Land Acquisition Bonds - DEBT SERVICE FUNDS To account for the accumulation of State assistance and tourist tax monies pledged to pay the principal, interest, and fiscal charges on the Spring Training Facility Bonds. To account for the accumulation of ad valorem taxes to pay the principal, interest, and fiscal charges related to the Land Acquisition Bonds. MAJOR CAPITAL PROJECTS FUND Optional Sales Tax- To account for revenues generated by the local option one cent sales tax. Monies are used for various capital projects. 107 1 Indian River County, Florida Combining Balance Sheet Nonmajor Governmental Funds September 30, 2014 Special Revenue 1 Court Section 8 Rental Special Law Facilities Assistance Enforcement ASSETS Cash and cash equivalents $ 1,182,853 $ 350,321 $ 305,653 Accounts receivable - - Due from other funds - - - Due from other governments - 3,888 - Interest receivable 294 88 75 I Inventories - - - Prepaid items 533 - Total Assets $ 1,183,147 $ 354,830 $ 305,728 LIABILITIES I Accounts payable $ 103,455 $ 4,569 $ Retainage payable - - I Due to other funds - - Due to other governments 10,169 Unearned revenues - - Other deposits Total Liabilities 103,455 14,738 DEFERRED INFLOWS OF RESOURCES Unavailable revenue - state and federal grants - Total Deferred Inflows of Resources FUND BALANCES Nonspendable: I Inventories - - Prepaid items 533 Restricted for: Court -related costs and improvements 1,079,692 - Housing assistance - 339,559 Law enforcement/public safety - 305,728 Tourism -related activities Beach renourishment Boating related projects Library services - - Land acquisition - Stormwater, street lighting, and other special assessments Voting/election activities - Debt service Dodgertown repairs/improvements - Committed to: Environmental conservation/preservation Law Enforcement/public safety - - Assigned to: Law enforcement/public safety Unassigned Total Fund Balances 1,079,692 340,092 305,728 Total Liabilities and Fund Balances $ 1,183,147 $ 354,830 $ 305,728 1 108 1 Special Revenue State Housing Tree Ordinance Tourist Initiatives Fines Development 911 Surcharge Drug Abuse Partnership $ 303,387 $ 408,492 $ 1,377,401 $ 207,696 $ 717,109 - 58,521 20,865 - 80 98 354 54 194 $ 303,467 $ 408,590 $ 1,436,276 $ 228,615 $ 717,303 $ 2,450 $ 75,358 $ 12,017 $ 2,450 75,358 12,017 301,017 301,017 333,232 1,424,259 333,232 1,424,259 7,814 $ 3,392 7,814 3,392 713,911 220,801 220,801 713,911 $ 303,467 $ 408,590 S 1,436,276 $ 228,615 S 717,303 Continued 109 ASSETS Cash and cash equivalents Accounts receivable Due from other funds Due from other governments Interest receivable Inventories Prepaid items Total Assets Indian River County, Florida Combining Balance Sheet Nonmajor Governmental Funds September 30, 2014 Special Revenue Multi - Metropolitan Jurisdictional Planning Law Native Uplands Organization Enforcement Land Acquisition 1,061 $ 119,004 $ 832,501 239,080 - 28 217 7,200 $ 247,341 $ 119,032 $ 832,718 LIABILITIES Accounts payable $ 26,848 $ $ 1,000 Retainage payable - Due to other funds 267,000 Due to other governments Unearned revenues Other deposits - Total Liabilities 293,848 1,000 DEFERRED INFLOWS OF RESOURCES Unavailable revenue - state and federal grants Total Deferred Inflows of Resources FUND BALANCES Nonspendable: Inventories 108,511 108,511 Prepaid items 7,200 Restricted for: Court -related costs and improvements Housing assistance Law enforcement/public safety 119,032 Tourism -related activities Beach renourishment Boating related projects Library services Land acquisition Stormwater, street lighting, and other special assessments Voting/election activities Debt service Dodgertown repairs/improvements Committed to: Environmental conservation/preservation 831,718 Law Enforcement/public safety Assigned to: Law enforcement/public safety Unassigned (162,218) Total Fund Balances (155,018) 119,032 831,718 Total Liabilities and Fund Balances $ 247,341 $ 119,032 $ 832,718 110 Special Revenue CDBG Neighborhood Florida Boating Beach Stabilization Improvement Restoration Program Program Library Bequests Disabled Access Program $ 6,225,661 $ 49,281 $ 1,211,193 $ 45,333 $ 276,404 1,616 1 313 12 63,074 16 $ 6,503,681 $ 49,282 $ 1,211,506 $ 45,345 $ 63,090 $ 141,101 $ 47,561 $ $ 629 $ 49,381 - - 190,482 47,561 629 276,404 276,404 6,036,795 1,721 63,090 1,211,506 6,036,795 1,721 1,211,506 44,716 44,716 63,090 $ 6,503,681 $ 49,282 $ 1,211,506 $ 45,345 $ 63,090 Continued 111 1 Indian River County, Florida Combining Balance Sheet I Nonmajor Governmental Funds September 30, 2014 Special Revenue 1 Traffic Federal/State Education Grants Program Land Acquisition Il ASSETS Cash and cash equivalents $ 514 $ 9,999 $ 201,801 Accounts receivable - 46 Due from other funds - Due from other governments 5,841 - - Interest receivable - 2 46 Inventories - - Prepaid items Total Assets $ 6,355 $ 10,001 $ 201,893 1 LIABILITIES Accounts payable $ 2,355 $ 2,225 $ 744 Retainage payable - Due to other funds 4,000 Due to other governments - Unearned revenues Other deposits 40,294 Total Liabilities 6,355 2,225 41,038 DEFERRED INFLOWS OF RESOURCES Unavailable revenue - state and federal grants Total Deferred Inflows of Resources FUND BALANCES Nonspendable: Inventories Prepaid items Restricted for: I Court-related costs and improvements Housing assistance - Law enforcement/public safety 7,776 Tourism -related activities - Beach renourishment Boating related projects Library services Land acquisition 160,855111 Stormwater, street lighting, and other special assessments Voting/election activities I Debt service Dodgertown repairs/improvements Committed to: Environmental conservation/preservation Law Enforcement/public safety Assigned to: Law enforcement/public safety Unassigned Total Fund Balances 7,776 160,855 Total Liabilities and Fund Balances $ 6,355 $ 10,001 $ 201,893 1 112 1 Special Revenue East Gifford Vero Lakes Dodgertown Clerk Special Sheriff Special Stormwater Estates Reserve Revenue Revenue 19,095 $ 1,367,454 $ 491,035 $ 2,027,585 $ 1,622,738 - 23,364 10 1,036 - 10,417 5 356 11,916 19,688 $ 19,110 $ 1,368,846 $ 501,452 $ 2,039,501 $ 1,665,790 $ $ 43 $ 151,691 $ - $ 17,723 52,995 - - 19,110 43 204,686 - 17,723 1,368,803 19,110 1,368,803 296,766 19,688 11,916 - 2,027,585 1,164,575 360,194 103,610 296,766 2,039,501 1,648,067 $ 19,110 $ 1,368,846 $ 501,452 $ 2,039,501 $ 1,665,790 Continued 113 1 Indian River County, Florida Combining Balance Sheet Nonmajor Governmental Funds September 30, 2014 Special Revenue Supervisor of Elections Special Street Lighting CDBG NSP3 Revenue Districts Grant ASSETS Cash and cash equivalents $ 18,510 $ 470,810 $ 395 I Accounts receivable - - Due from other funds 2,197 - Due from other governments Interest receivable 126 Inventories - - Prepaid items Total Assets $ 18,510 $ 473,133 $ 395 1 LIABILITIES Accounts payable $ $ 9,156 $ 36,264 Retainage payable - Due to other funds 3,500 Due to other governments - - Unearned revenues 16,158 Other deposits - Total Liabilities 16,158 9,156 39,764 DEFERRED INFLOWS OF RESOURCES Unavailable revenue - state and federal grants Total Deferred Inflows of Resources FUND BALANCES Nonspendable: Inventories Prepaid items Restricted for: Court -related costs and improvements Housing assistance Law enforcement/public safety Tourism -related activities Beach renourishment Boating related projects Library services Land acquisition Stormwater, street lighting, and other special assessments 463,977 Voting/election activities 2,352 Debt service Dodgertown repairs/improvements Committed to: Environmental conservation/preservation Law Enforcement/public safety Assigned to: Law enforcement/public safety Unassigned - (39,369) Total Fund Balances 2,352 463,977 (39,369) Total Liabilities and Fund Balances $ 18,510 $ 473,133 $ 395 1 114 1 Debt Service Total Nonmajor Spring Training Land Acquisition Governmental Facility Bonds Bonds Funds $ 1,723,353 $ 779,192 $ 22,132,501 23,410 53,070 56,313 615,016 455 202 4,632 19,688 19,649 $ 1,723,808 $ 832,464 $ 22,871,209 $ - $ - $ 646,395 102,376 274,500 10,169 16,158 40,294 1,723,808 1,089,892 384,915 384,915 19,688 1n ,V649 11 3,107,277 1,055,191 3,305,261 333,232 6,036,795 1,211,506 44,716 160,855 1,851,890 - 2,352 832,464 2,556,272 296,766 1,132,735 360,194 103,610 (201,587) 1,723,808 832,464 21,396,402 $ 1,723,808 S 832,464 $ 22,871,209 115 Indian River County, Florida Combining Statement of Revenues, Expenditures and Changes in Fund Balances Nonmajor Governmental Funds For the Year Ended September 30, 2014 REVENUES Taxes Permits, fees and special assessments Intergovernmental Charges for services Judgments, fines and forfeits Interest Miscellaneous Total revenues EXPENDITURES Current: General government Public safety Physical environment Transportation Economic environment Human services Culture/recreation Court related Debt service Principal Interest and fiscal charges Total expenditures Special Revenue Court Facilities $ Section 8 Rental Special Law Assistance Enforcement $ 2,043,041 525,702 112,337 2,570 576 - 153 528,272 2,156,107 39,112 518,610 2,211,934 557,722 2,211,934 $ 39,270 55,818 607 95,695 Excess of revenues over (under) expenditures (29,450) (55,827) 95,695 OTHER FINANCING SOURCES (USES) Transfers in - Transfers out - (92,066) Total other financing sources (uses) (92,066) Net changes in fund balances (29,450) (55,827) 3,629 Fund balances at beginning of year 1,109,142 395,919 302,099 Fund balances at end of year $ 1,079,692 $ 340,092 $ 305,728 116 Special Revenue $ State Housing Tree Ordinance Tourist Initiatives Fines Development 911 Surcharge Drug Abuse Partnership $ 719,326 $ $ $ 695,446 72,427 405,815 98,957 40,900 - 9,791 - 640 831 2,879 483 1,559 5,661 41,540 720,157 698,325 82,701 511,992 403,394 61,852 - 10,575 595,184 6,245 743,334 6,245 35,295 743,334 403,394 (23,177) 294,931 (198,004) (198,004) 72,427 595,184 10,274 (83,192) 35,295 (23,177) 96,927 10,274 (83,192) 265,722 356,409 1,327,332 210,527 797,103 $ 301,017 $ 333,232 $ 1,424,259 $ 220,801 $ 713,911 Continued 117 1 Indian River County, Florida Combining Statement of Revenues, Expenditures and Changes in Fund Balances Nonmajor Governmental Funds For the Year Ended September 30, 2014 1 Special Revenue Multi - Metropolitan Jurisdictional Native Uplands Planning Law Land Organization Enforcement Acquisition REVENUES Taxes $ $ $ - Permits, fees and special assessments - Intergovernmental 480,520 - Charges for services - - Judgments, fines and forfeits 32,142 - Interest 250 1,897 I Miscellaneous 91,948 - Total revenues 572,468 32,392 1,897 EXPENDITURES Current: General government 443,462 - Public safety - Physical environment - 7,657II Transportation Economic environment Human services - Culture/recreation - Court related - - Debt service• Principal - - Interest and fiscal charges - Total expenditures 443,462 - 7,657 Excess of revenues over (under) expenditures 129,006 32,392 (5,760) OTHER FINANCING SOURCES (USES) Transfers in Transfers out (16,984)Il Total other financing sources (uses) (16,984) Net changes in fund balances 129,006 15,408 (5,760) Fund balances at beginning of year (284,024) 103,624 837,478 Fund balances at end of year $ (155,018) $ 119,032 $ 831,718 1 1 1 118 1 Special Revenue Beach Restoration CDBG Neighborhood Stabilization Program $ 719,325 $ 285,766 121,094 13,973 1 1,019,064 121,095 107,130 Florida Boating Improvement Program $ 68,270 2,670 Library Bequests 122 70,940 Disabled Access Program $ 81 142 122 223 1,082,583 61 54,574 1,082,583 107,130 61 54,574 (63,519) 13,965 70,879 (54,452) 223 113,403 113,403 49,884 5,986,911 13,965 (12,244) 70,879 1,140,627 $ 6,036,795 $ 1,721 $ (54,452) 223 99,168 62,867 1,211,506 $ 44,716 $ 63,090 Continued 119 Indian River County, Florida Combining Statement of Revenues, Expenditures and Changes in Fund Balances Nonmajor Governmental Funds For the Year Ended September 30, 2014 REVENUES Taxes Permits, fees and special assessments Intergovernmental Charges for services Judgments, fines and forfeits Interest Miscellaneous Total revenues EXPENDITURES Current: General government Public safety Physical environment Transportation Economic environment Human services Culture/recreation Court related Debt service: Principal Interest and fiscal charges Total expenditures Special Revenue Traffic Federal/State Education Land Grants Program Acquisition $ $ $ 867,631 49,500 15 867,631 29 526 2,375 44 52,401 6,675 866,179 866,179 103,717 6,675 103,717 Excess of revenues over (under) expenditures 1,452 (6,631) (51,316) OTHER FINANCING SOURCES (USES) Transfers in Transfers out Total other financing sources (uses) Net changes in fund balances 1,452 (6,631) (51,316) Fund balances at beginning of year (1,452) 14,407 212,171 Fund balances at end of year $ $ 7,776 $ 160,855 120 Special Revenue East Gifford Vero Lakes Dodgertown Clerk Special Sheriff Special Stormwater Estates Reserve Revenue Revenue $ 24 $ 306 $ $ $ 922 93,599 - 125,000 60,318 371,545 405,629 - 195,435 199,380 42 3,128 2,374 - - 114,172 988 97,033 125,000 569,354 779,499 41,800 - 886,464 535,640 1,240,581 219,646 12,412 - 41,800 886,464 755,286 1,252,993 988 55,233 (761,464) (185,932) (473,494) 212,029 143,880 (50) (3,039) - (50) (3,039) 212,029 143,880 938 52,194 (549,435) (185,932) (329,614) 18,172 1,316,609 846,201 2,225,433 1,977,681 $ 19,110 $ 1,368,803 $ 296,766 $ 2,039,501 $ 1,648,067 Continued 121 I Indian River County, Florida Combining Statement of Revenues, Expenditures and Changes in Fund Balances Nonmajor Governmental Funds For the Year Ended September 30, 2014 REVENUES Taxes Permits, fees and special assessments Intergovernmental Charges for services Judgments, fines and forfeits Interest Miscellaneous Total revenues EXPENDITURES Current: General government Public safety Physical environment Special Revenue Supervisor of Elections Special Street Lighting Revenue Districts $ 2,096 $ 196,915 1,187 2,440 202,638 Transportation 198,013 Economic environment Human services Culture/recreation Court related Debt service. Principal Interest and fiscal charges Total expenditures 198,013 Excess of revenues over (under) expenditures 4,625 OTHER FINANCING SOURCES (USES) Transfers in 2,352 Transfers out - (5,766) Total other financing sources (uses) 2,352 (5,766) Net changes in fund balances 2,352 (1,141) Fund balances at beginning of year 465,118 Fund balances at end of year $ 2,352 $ 463,977 $ 1 1 1 CDBG NSP3 1 Grant 1 569,563 1 20,623 590,186 122 1 1 595,252 1 1 595,252 (5,066) (5,066) 1 (34,303) 1 (39,369) 1 1 1 1 Debt Service Total Land Nonmajor Spring Training Acquisition Governmental Facility Bonds Bonds Funds $ 479,550 $ 4,730,556 $ 6,651,183 291,436 500,004 6,344,395 1,553,440 533,562 3,833 7,042 47,361 237,372 983,387 445,000 616,404 1,061,404 (78,017) (78,017) 1,801,825 4,737,598 15,658,749 1,018,214 1,705,827 111,374 246,488 702,382 3,683,872 2,773,261 750,668 3,255,000 3,700,000 1,368,212 1,984,616 4,623,212 16,676,702 114,386 (1,017,953) 471,664 (109,951) (425,860) (109,951) 45,804 4,435 (972,149) 828,029 22,368,551 $ 1,723,808 $ 832,464 $ 21,396,402 123 Indian River County, Florida Budgetary Comparison Schedule Court Facilities For the Year Ended September 30, 2014 REVENUES Charges for services Interest Total revenues EXPENDITURES General government Court related Total expenditures Net change in fund balances Fund balances at beginning of year Fund balances at end of year 124 Final Budget Actual Amounts $ 481,000 $ 2,000 483,000 360,533 616,711 977,244 (494,244) 494,244 $ Variance Positive (Negative) 525,702 $ 44,702 2,570 570 528,272 39,112 518,610 557,722 45,272 321,421 98,101 419,522 (29,450) 464,794 1,109,142 614,898 $ 1,079,692 $ 1,079,692 Indian River County, Florida Budgetary Comparison Schedule Section 8 Rental Assistance For the Year Ended September 30, 2014 REVENUES Intergovernmental Charges for services Interest Miscellaneous Total revenues EXPENDITURES Human services Total expenditures Net change in fund balances Fund balances at beginning of year Fund balances at end of year 125 Final Budget $ 2,467,172 1,369 2,468,541 2,510,875 2,510,875 (42,334) 42,334 Actual Amounts $ 2,043,041 112,337 576 153 2,156,107 Variance Positive (Negative) $ (424,131) 112,337 576 (1,216) (312,434) 2,211,934 298,941 2,211,934 (55,827) 395,919 298,941 (13,493) 353,585 $ - $ 340,092 $ 340,092 Indian River County, Florida Budgetary Comparison Schedule Special Law Enforcement For the Year Ended September 30, 2014 Variance Final Actual Positive Budget Amounts (Negative) REVENUES Charges for services $ - $ 39,270 $ 39,270 Judgments, fines and forfeits 103,287 55,818 (47,469) Interest 607 607 Total revenues 103,287 95,695 (7,592) EXPENDITURES Public safety Total expenditures Excess of revenues over (under) expenditures 103,287 95,695 (7,592) OTHER FINANCING SOURCES (USES) Transfers out (103,287) (92,066) 11,221 Total other financing sources (uses) (103,287) (92,066) 11,221 Net change in fund balances - 3,629 3,629 Fund balances at beginning of year 302,099 302,099 Fund balances at end of year $ $ 305,728 $ 305,728 126 Indian River County, Florida Budgetary Comparison Schedule Tree Ordinance Fines For the Year Ended September 30, 2014 Variance Final Actual Positive Budget Amounts (Negative) REVENUES Judgments, fines and forfeits $ - $ 40,900 $ 40,900 Interest 640 640 Total revenues 41,540 41,540 EXPENDITURES Culture/recreation Total expenditures Net change in fund balances Fund balances at beginning of year Fund balances at end of year 127 50,000 6,245 43,755 50,000 6,245 43,755 (50,000) 35,295 85,295 50,000 265,722 215,722 $ $ 301,017 $ 301,017 Indian River County, Florida Budgetary Comparison Schedule Tourist Development For the Year Ended September 30, 2014 Variance Final Actual Positive Budget Amounts (Negative) REVENUES Taxes $ 638,500 $ 719,326 $ 80,826 Interest 2,375 831 (1,544) Total revenues 640,875 720,157 79,282 EXPENDITURES Culture/recreation 753,318 743,334 9,984 Total expenditures 753,318 743,334 9,984 Net change in fund balances (112,443) (23,177) 89,266 Fund balances at beginning of year 112,443 356,409 243,966 Fund balances at end of year $ $ 333,232 $ 333,232 128 Indian River County, Florida Budgetary Comparison Schedule 911 Surcharge For the Year Ended September 30, 2014 REVENUES Intergovernmental Interest Miscellaneous Total revenues EXPENDITURES Public safety Total expenditures Excess of revenues over (under) expenditures OTHER FINANCING SOURCES (USES) Transfers out Total other financing sources (uses) Net change in fund balances Fund balances at beginning of year Fund balances at end of year 129 Final Budget Actual Amounts $ 722,000 $ 651 722,651 579,436 579,436 143,215 (198,004) (198,004) (54,789) 54,789 $ 695,446 $ 2,879 698,325 403,394 403,394 294,931 (198,004) (198,004) Variance Positive (Negative) (26,554) 2,879 (651) (24,326) 176,042 176,042 151,716 96,927 151,716 1,327,332 1,272,543 - $ 1,424,259 $ 1,424,259 Indian River County, Florida Budgetary Comparison Schedule Drug Abuse For the Year Ended September 30, 2014 Variance Final Actual Positive Budget Amounts (Negative) REVENUES Intergovernmental $ 72,427 $ 72,427 $ - Judgments, fines and forfeits 9,791 9,791 Interest 483 483 Total revenues 72,427 82,701 10,274 EXPENDITURES Public safety 61,852 61,852 Human services 10,575 10,575 Total expenditures 72,427 72,427 Net change in fund balances - 10,274 10,274 Fund balances at beginning of year 210,527 210,527 Fund balances at end of year $ - $ 220,801 $ 220,801 130 Indian River County, Florida Budgetary Comparison Schedule State Housing Initiatives Partnership For the Year Ended September 30, 2014 Variance Final Actual Positive Budget Amounts (Negative) REVENUES Intergovernmental $ 350,000 $ 405,815 $ 55,815 Charges for services - 98,957 98,957 Interest 1,559 1,559 Miscellaneous 685 5,661 4,976 Total revenues 350,685 511,992 161,307 EXPENDITURES Human services 641,056 595,184 45,872 Total expenditures 641,056 595,184 45,872 Net change in fund balances (290,371) (83,192) 207,179 Fund balances at beginning of year 290,371 797,103 506,732 Fund balances at end of year $ - $ 713,911 $ 713,911 131 Indian River County, Florida Budgetary Comparison Schedule Metropolitan Planning Organization For the Year Ended September 30, 2014 REVENUES Intergovernmental Miscellaneous Total revenues EXPENDITURES General government Total expenditures Net change in fund balances Fund balances at beginning of year Fund balances at end of year 132 Final Budget Actual Amounts $ 558,151 $ 1,369 559,520 728,334 728,334 (168,814) 168,814 $ Variance Positive (Negative) 480,520 $ (77,631) 91,948 90,579 572,468 443,462 443,462 12,948 284,872 284,872 129,006 297,820 (284,024) (452,838) $ (155,018) $ (155,018) Indian River County, Florida Budgetary Comparison Schedule Multi -Jurisdictional Law Enforcement For the Year Ended September 30, 2014 REVENUES Charges for services Judgments, fines and forfeits Interest Total revenues EXPENDITURES Public safety Total expenditures Excess of revenues over (under) expenditures OTHER FINANCING SOURCES (USES) Transfers out Total other financing sources (uses) Variance Final Actual Positive Budget Amounts (Negative) $ $ $ 27,342 32,142 4,800 - 250 250 27,342 32,392 5,050 27,342 32,392 5,050 (27,342) (16,984) 10,358 (27,342) (16,984) 10,358 Net change in fund balances - 15,408 15,408 Fund balances at beginning of year 103,624 103,624 Fund balances at end of year $ $ 119,032 $ 119,032 133 Indian River County, Florida Budgetary Comparison Schedule Native Uplands Land Acquisition For the Year Ended September 30, 2014 Variance Final Actual Positive Budget Amounts (Negative) REVENUES - Interest $ $ 1,897 $ 1,897 Total revenues 1,897 1,897 EXPENDITURES Physical environment 55,000 7,657 47,343 Total expenditures 55,000 7,657 47,343 Net change in fund balances (55,000) (5,760) 49,240 Fund balances at beginning of year 55,000 837,478 782,478 Fund balances at end of year $ - $ 831,718 $ 831,718 134 Indian River County, Florida Budgetary Comparison Schedule Beach Restoration For the Year Ended September 30, 2014 REVENUES Taxes Intergovernmental Interest Miscellaneous Total revenues EXPENDITURES Culture/recreation Total expenditures Excess of revenues over (under) expenditures OTHER FINANCING SOURCES (USES) Transfers in Total other financing sources (uses) Net change in fund balances Fund balances at beginning of year Fund balances at end of year 135 Final Budget $ 638,500 2,753,091 23,750 651 3,415,992 6,788,567 6,788,567 (3,372,575) 113,403 113,403 (3,259,172) 3,259,172 $ Actual Amounts $ 719,325 285,766 13,973 1,019,064 1,082,583 1,082,583 (63,519) 113,403 113,403 49,884 5,986,911 - $ 6,036,795 Variance Positive (Negative) $ 80,825 (2,467,325) (9,777) (651) (2,396,928) 5,705,984 5,705,984 3,309,056 3,309,056 2,727,739 $ 6,036,795 REVENUES Intergovernmental Interest Total revenues Indian River County, Florida Budgetary Comparison Schedule CDBG Neighborhood Stabilization Program For the Year Ended September 30, 2014 Variance Final Actual Positive Budget Amounts (Negative) $ $ 121,094 $ 121,094 121,095 121,095 EXPENDITURES Economic environment 114,112 107,130 6,982 Total expenditures 114,112 107,130 6,982 Net change in fund balances (114,112) 13,965 128,077 Fund balances at beginning of year 114,112 (12,244) (126,356) Fund balances at end of year $ $ 1,721 $ 1,721 136 Indian River County, Florida Budgetary Comparison Schedule Florida Boating Improvement Program For the Year Ended September 30, 2014 Variance Final Actual Positive Budget Amounts (Negative) REVENUES Intergovernmental $ 42,500 $ 68,270 $ 25,770 Interest 2,670 2,670 Total revenues 42,500 70,940 28,440 EXPENDITURES Culture/recreation 266,300 61 266,239 Total expenditures 266,300 61 266,239 Net change in fund balances (223,800) 70,879 294,679 Fund balances at beginning of year 223,800 1,140,627 916,827 Fund balances at end of year $ $ 1,211,506 $ 1,211,506 137 REVENUES Interest Total revenues Indian River County, Florida Budgetary Comparison Schedule Library Bequests For the Year Ended September 30, 2014 Variance Final Actual Positive Budget Amounts (NegativeL $ $ 122 $ 122 122 122 EXPENDITURES Culture/recreation 59,904 54,574 5,330 Total expenditures 59,904 54,574 5,330 Net change in fund balances (59,904) (54,452) 5,452 Fund balances at beginning of year 59,904 99,168 39,264 Fund balances at end of year $ - $ 44,716 $ 44,716 138 REVENUES Judgments, fines and forfeits Interest Total revenues Indian River County, Florida Budgetary Comparison Schedule Disabled Access Program For the Year Ended September 30, 2014 Variance Final Actual Positive Budget Amounts (Negative) $ $ 81 $ 81 142 142 223 223 EXPENDITURES Human services 20,000 - 20,000 Total expenditures 20,000 20,000 Net change in fund balances (20,000) 223 20,223 Fund balances at beginning of year 20,000 62,867 42,867 Fund balances at end of year $ - $ 63,090 $ 63,090 139 REVENUES Intergovernmental Total revenues Indian River County, Florida Budgetary Comparison Schedule Federal/State Grants For the Year Ended September 30, 2014 Variance Final Actual Positive Budget Amounts (Negative) $ 967,479 $ 867,631 $ (99,848) 967,479 867,631 (99,848) EXPENDITURES Human services 967,479 866,179 101,300 Total expenditures 967,479 866,179 101,300 Net change in fund balances Fund balances at beginning of year 1,452 1,452 (1,452) (1,452) Fund balances at end of year $ - $ - $ 140 Indian River County, Florida Budgetary Comparison Schedule Traffic Education Program For the Year Ended September 30, 2014 REVENUES Judgments, fines and forfeits Interest Total revenues EXPENDITURES Transportation Total expenditures Net change in fund balances Fund balances at beginning of year Fund balances at end of year 141 Variance Final Actual Positive Budget Amounts (Negative) $ $ 15 $ 15 29 29 44 44 13,593 6,675 6,918 13,593 6,675 6,918 (13,593) (6,631) 6,962 13,593 14,407 814 $ - $ 7,776 $ 7,776 Indian River County, Florida Budgetary Comparison Schedule Land Acquisition For the Year Ended September 30, 2014 Variance Final Actual Positive Budget Amounts (Negative) REVENUES Intergovernmental $ 64,500 $ 49,500 $ (15,000) Interest 526 526 Miscellaneous 42,669 2,375 (40,294) Total revenues 107,169 52,401 (54,768) EXPENDITURES Physical environment 211,669 103,717 107,952 Total expenditures 211,669 103,717 107,952 Net change in fund balances (104,500) (51,316) 53,184 Fund balances at beginning of year 104,500 212,171 107,671 Fund balances at end of year $ $ 160,855 $ 160,855 142 Indian River County, Florida Budgetary Comparison Schedule East Gifford Stormwater For the Year Ended September 30, 2014 REVENUES Taxes Permits, fees and special assessments Interest Total revenues EXPENDITURES Transportation Total expenditures Excess of revenues over (under) expenditures OTHER FINANCING SOURCES (USES) Transfers out Total other financing sources (uses) Net change in fund balances Fund balances at beginning of year Fund balances at end of year 143 Variance Final Actual Positive Budget Amounts (Negative) $ $ 24 $ 24 940 922 (18) - 42 42 940 988 48 883 - 883 883 - 883 57 988 931 (57) (50) 7 (57) (50) 7 938 938 - 18,172 18,172 $ 19,110 $ 19,110 Indian River County, Florida Budgetary Comparison Schedule Vero Lakes Estates For the Year Ended September 30, 2014 Variance Final Actual Positive Budget Amounts (Negative) REVENUES Taxes $ - $ 306 $ 306 Permits, fees and special assessments 91,694 93,599 1,905 Interest 2,850 3,128 278 Total revenues 94,544 97,033 2,489 EXPENDITURES Transportation 965,000 41,800 923,200 Total expenditures 965,000 41,800 923,200 Excess of revenues over (under) expenditures (870,456) 55,233 925,689 OTHER FINANCING SOURCES (USES) Transfers out (4,532) (3,039) 1,493 Total other financing sources (uses) (4,532) (3,039) 1,493 Net change in fund balances (874,988) 52,194 927,182 Fund balances at beginning of year 874,988 1,316,609 441,621 Fund balances at end of year $ - $ 1,368,803 $ 1,368,803 144 Indian River County, Florida Budgetary Comparison Schedule Dodgertown Reserve For the Year Ended September 30, 2014 REVENUES Intergovernmental Total revenues EXPENDITURES Culture/recreation Total expenditures Excess of revenues over (under) expenditures OTHER FINANCING SOURCES (USES) Transfers in Total other financing sources (uses) Net change in fund balances Fund balances at beginning of year Fund balances at end of year 145 Final Budget Actual Amounts $ 125,000 $ 125,000 1,188,594 1,188,594 (1,063,594) 217,393 217,393 (846,201) 846,201 Variance Positive (Negative) 125,000 $ 125,000 886,464 886,464 302,130 302,130 (761,464) 302,130 212,029 (5,364) 212,029 (5,364) (549,435) 296,766 846,201 $ 296,766 $ 296,766 Indian River County, Florida Budgetary Comparison Schedule Clerk Special Revenue For the Year Ended September 30, 2014 Variance Final Actual Positive Budget Amounts (Negative) REVENUES Charges for services $ 503,620 $ 371,545 $ (132,075) Judgments, fines and forfeits 250,900 195,435 (55,465) Interest 766 2,374 1,608 Total revenues 755,286 569,354 (185,932) EXPENDITURES General government 535,640 535,640 Court related 219,646 219,646 Total expenditures 755,286 755,286 Net change in fund balances - (185,932) (185,932) Fund balances at beginning of year - 2,225,433 2,225,433 Fund balances at end of year $ - $ 2,039,501 $ 2,039,501 146 Indian River County, Florida Budgetary Comparison Schedule Sheriff Special Revenue For the Year Ended September 30, 2014 REVENUES Intergovernmental Charges for services Judgments, fines and forfeits Miscellaneous Total revenues EXPENDITURES Public safety Court related Total expenditures Excess of revenues over (under) expenditures OTHER FINANCING SOURCES (USES) Transfers in Total other financing sources (uses) Net change in fund balances Fund balances at beginning of year Fund balances at end of year 147 Final Budget $ 60,318 403,000 205,000 110,000 778,318 1,251,588 12,412 Actual Amounts $ 60,318 $ 405,629 199,380 114,172 779,499 1,240,581 12,412 1,264,000 1,252,993 (485,682) 165,459 165,459 (320,223) 320,223 $ (473,494) 143,880 143,880 Variance Positive (Negative) 2,629 (5,620) 4,172 1,181 11,007 11,007 12,188 (21,579) (21,579) (329,614) (9,391) 1,977,681 1,657,458 - $ 1,648.067 $ 1,648,067 Indian River County, Florida Budgetary Comparison Schedule 1 Supervisor of Elections Special Revenue For the Year Ended September 30, 2014 Variance Final Actual Positive Budget Amounts (Negative) REVENUES Intergovernmental $ $ $ - Total revenues - EXPENDITURES General government 2,352 2,352 Total expenditures 2,352 2,352 Excess of revenues over (under) expenditures (2,352) 2,352 OTHER FINANCING SOURCES (USES) Transfers in 2,352 2,352 Total other financing sources (uses) 2,352 2,352 1 Net change in fund balances - 2,352 2,352 Fund balances at beginning of year - - Fund balances at end of year $ - $ 2,352 $ 2,352 1 1 1 1 9 1 1 1 148 1 Indian River County, Florida Budgetary Comparison Schedule Street Lighting Districts For the Year Ended September 30, 2014 REVENUES Taxes Permits, fees and special assessments Interest Miscellaneous Total revenues EXPENDITURES Transportation Total expenditures Excess of revenues over (under) expenditures OTHER FINANCING SOURCES (USES) Transfers out Total other financing sources (uses) Net change in fund balances Fund balances at beginning of year Fund balances at end of year 149 $ Final Budget 193,918 1,083 3,205 198,206 231,631 231,631 (33,425) (6,485) (6,485) (39,910) 39,910 Actual Amounts $ 2,096 196,915 1,187 2,440 Variance Positive (Negative) $ 2,096 2,997 104 (765) 202,638 4,432 198,013 198,013 4,625 (5,766) (5,766) (1,141) 465,118 33,618 33,618 38,050 719 719 38,769 425,208 $ $ 463,977 $ 463,977 Indian River County, Florida Budgetary Comparison Schedule CDBG NSP3 Grant For the Year Ended September 30, 2014 Variance Final Actual Positive Budget Amounts (Negative) REVENUES Intergovernmental $ 569,563 $ 569,563 $ - Miscellaneous 575,936 20,623 (555,313) Total revenues 1,145,499 590,186 (555,313) EXPENDITURES Economic environment 1,145,499 595,252 550,247 Total expenditures 1,145,499 595,252 550,247 Net change in fund balances (5,066) (5,066) Fund balances at beginning of year - (34,303) (34,303) Fund balances at end of year $ $ (39,369) $ (39,369) 150 Indian River County, Florida Budgetary Comparison Schedule Spring Training Facility Bonds For the Year Ended September 30, 2014 Variance Final Actual Positive Budget Amounts (Negative) REVENUES Taxes $ 399,000 $ 479,550 $ 80,550 Intergovernmental 475,000 500,004 25,004 Interest 3,513 3,833 320 Total revenues 877,513 983,387 105,874 EXPENDITURES Debt service: Principal 445,000 445,000 Interest and fiscal charges 629,870 616,404 13,466 Total expenditures 1,074,870 1,061,404 13,466 Net change in fund balances (197,357) (78,017) 119,340 Fund balances at beginning of year 197,357 1,801,825 1,604,468 Fund balances at end of year $ - $ 1,723,808 $ 1,723,808 151 Indian River County, Florida Budgetary Comparison Schedule Land Acquisition Bonds For the Year Ended September 30, 2014 REVENUES Taxes Interest Total revenues EXPENDITURES Debt service: Principal Interest and fiscal charges Total expenditures Excess of revenues over (under) expenditures OTHER FINANCING SOURCES (USES) Transfers out Total other financing sources (uses) Net change in fund balances Fund balances at beginning of year Fund balances at end of year 152 Final Budget Variance Actual Positive Amounts (Negative) $ 4,634,636 $ 4,730,556 $ 95,920 7,555 7,042 (513) 4,642,191 4,737,598 95,407 3,255,000 1,377,462 4,632,462 9,729 (118,225) (118,225) 3,255,000 1,368,212 4,623,212 114,386 (109,951) (109,951) 9,250 9,250 104,657 8,274 8,274 (108,496) 108,496 $ 4,435 828,029 112,931 719,533 $ 832,464 $ 832,464 Indian River County, Florida Budgetary Comparison Schedule Optional Sales Tax For the Year Ended September 30, 2014 REVENUES Taxes Permits, fees and special assessments Intergovernmental Interest Miscellaneous Total revenues EXPENDITURES Capital projects Total expenditures Excess of revenues over (under) expenditures OTHER FINANCING USES Transfers out Total other financing uses Net change in fund balances Fund balances at beginning of year Fund balances at end of year 153 Final Budget $ 13,000,000 6,013,409 128,250 4,058,306 23,199,965 Actual Amounts $ 15,228,304 50,482 3,689,417 109,649 63,080 19,140,932 Variance Positive (Negative) $ 2,228,304 50,482 (2,323,992) (18,601) (3,995,226) (4,059,033) 38,006,962 16,560,991 21,445,971 38,006,962 16,560,991 21,445,971 (14,806,997) 2,579,941 17,386,938 (1,030,593) (1,018,067) 12,526 (1,030,593) (1,018,067) 12,526 (15,837,590) 1,561,874 17,399,464 15,837,590 52,443,863 36,606,273 $ $ 54,005,737 $ 54,005,737 Elel MIS 11215 MS NM EMI Ele WED NM SE§ OM ME EIS MI SEM ME IME EVII EN INTERNAL SERVICE FUNDS Fleet Management- To account for the expenses incurred to repair and maintain the County's vehicles and equipment. Revenues are generated by charging user departments for maintenance of their vehicles and equipment. Self Insurance- To account for the expenses incurred for worker's compensation claims, general and auto liability and property damage, and employee health insurance claims. Revenues are generated by charges to the various departments and funds based on past experience and actuarial estimates. Information Technology- To account for the expenses incurred for maintaining the County's computer services and geographic information systems. Revenues are generated by charging user departments based on their number of computer equipment and their use of the geographic information system. 155 Indian River County, Florida Combining Statement of Net Position Internal Service Funds September 30, 2014 ASSETS Current assets: Cash and cash equivalents Accounts receivable - net Due from other funds Due from other governments Interest receivable Inventories Prepaid items Total current assets Non-current assets: Capital assets - depreciable Capital assets - accumulated depreciation Total non-current assets Total assets LIABILITIES Current liabilities (payable from current assets): Accounts payable Due to other funds Claims payable Accrued compensated absences Total current liabilities (payable from current assets) Non-current liabilities: Accrued compensated absences Claims payable Total non-current liabilities Total liabilities NET POSITION Net investment in capital assets Unrestricted Total net position Fleet Management Self Insurance $ 1,012 118,784 68,278 189,768 $ 30,713,136 205,669 1,596 15,748 1,114,483 $ Information Technology_ 1,765,708 963 35,330 $ Totals 32,479,856 324,453 1,596 68,278 16,711 189,768 1,149,813 377,842 32,050,632 1,802,001 34,230,475 268,392 16,918 (245,992) (16,195) 2,108,377 (1,746,961) 2,393,687 (2,009,148) 22,400 723 361,416 384,539 400,242 32,051,355 2,163,417 34,615,014 130,834 74,602 22,653 228,089 7,000 - 7,000 3,181,891 3,181,891 17,506 9,086 e 1 1 1 1 o 1 27,735 54,327 1 1 1 1 1 1 1 1 1 1 155,340 3,265,579 50,388 3,471,307 26,553 9,812 14,561 50,926 5,044,654 - 5,044,654 26,553 5,054,466 14,561 5,095,580 181,893 8,320,045 64,949 8,566,887 22,400 195,949 723 23,730,587 218,349 $ 23,731,310 361,416 384,539 1,737,052 25,663,588 $ 2,098,468 $ 26,048,127 156 OPERATING REVENUES Charges for services Total revenues Indian River County, Florida Combining Statement of Revenues, Expenses, and Changes in Fund Net Position Internal Service Funds For the Year Ended September 30, 2014 Fleet Self Information Management Insurance Technology Totals $ 3,653,785 $ 18,113,797 $ 775,736 $ 22,543,318 3,653,785 18,113,797 775,736 22,543,318 OPERATING EXPENSES Personal services 360,171 2,884,081 696,173 3,940,425 Material, supplies, services and other operating 3,217,712 17,110,317 290,806 20,618,835 Depreciation 24,966 217 150,986 176,169 Total operating expenses 3,602,849 19,994,615 1,137,965 24,735,429 Operating income (loss) 50,936 (1,880,818) (362,229) (2,192,111) NONOPERATING REVENUES (EXPENSES) Interest income 24 70,589 4,409 75,022 Total nonoperating revenues (expenses) 24 70,589 4,409 75,022 Income (loss) before transfers 50,960 (1,810,229) (357,820) (2,117,089) Capital contributions 158,653 158,653 Transfers in (out) 125,000 27,336 152,336 Change in net position 175,960 (1,782,893) (199,167) (1,806,100) Total net position - beginning Total net position - ending 42,389 25,514,203 2,297,635 27,854,227 $ 218,349 $ 23,731,310 $ 2,098,468 S 26,048,127 157 Indian River County, Florida Combining Statement of Cash Flows Internal Service Funds For the Year Ended September 30, 2014 CASH FLOWS FROM OPERATING ACTIVITIES Cash received from customers Cash paid to suppliers for goods and services Cash paid to employees for services Net cash provided by (used in) operating activities CASH FLOWS FROM NONCAPITAL FINANCING ACTIVITIES Transfers Payments on advances from other funds Net cash provided by noncapital financing activities CASH FLOWS FROM CAPITAL AND RELATED FINANCING ACTIVITIES Purchase of capital assets Net cash provided by (used in) capital and related financing activities CASH FLOWS FROM INVESTING ACTIVITIES Interest and dividends on investments Net cash provided by investing activities Net increase (decrease) in cash and cash equivalents Cash and cash equivalents at beginning of year Cash and cash equivalents at end of year Classified as: Current assets Fleet Management $ 3,704,402 (3,169,971) (348,366) 186,065 125,000 (310,000) (185,000) Self Insurance $ 17,915,518 $ (16,839,700) (2,881,184) (1,805,366) 27,336 Information Technology Totals 775,736 $ 22,395,656 (284,555) (20,294,226) (659,449) (3,888,999) (168,268) (1,787,569) 27,336 152,336 (310,000) (157,664) (1,167) (187,489) (188,656) (1,167) (187,489) (188,656) 24 75,162 4,843 80,029 24 75,162 _ 4,843 80,029 (78) (1,702,868) (350,914) (2,053,860) 1,090 32,416,004 2,116,622 34,533,716 1,012 $ 30,713,136 $ 1,765,708 $ 32,479,856 1,012 $ 30,713,136 $ 1,765,708 $ 32,479,856 1 1 A 1 1 1 1 1 v 158 1 Indian River County, Florida Combining Statement of Cash Flows Internal Service Funds For the Year Ended September 30, 2014 RECONCILIATION OF OPERATING INCOME (LOSS) TO NET CASH PROVIDED BY OPERATING ACTIVITIES Operating income (loss) Adjustments to reconcile operating income (loss) to net cash provided by operating activities. Depreciation (Increase) Decrease in assets: Accounts receivable Due from other funds Due from other governments Inventories Deposits Increase (Decrease) in liabilities• Accounts payable Claims payable Accrued compensated absences Total adjustments Net cash provided by (used in) operating activities NONCASH CAPITAL AND RELATED FINANCING ACTIVITIES Fleet Management Self Insurance Information Technology Totals 50,936 $ (1,880,818) $ (362,229) $ (2,192,111) 24,966 217 6,463 (196,684) (1,595) 44,154 (12,808) 60,549 11,805 79,257 38,815 152,545 2,897 150,986 176,169 (190,221) (1,595) 44,154 (12,808) (3,047) 76,210 9,298 108,662 152,545 36,724 51,426 135,129 75,452 $ 186,065 $ (1,805,366) $ Change in fair value of investments $ Contributed property, infrastructure and equipment $ 159 4,489 $ -$ 193,961 404,542 (168,268) $ (1,787.569) 275 $ 4,764 158,653 $ 158,653 MEI EMS MEI IROz;EIM FIDUCIARY FUND Agency Fund- To account for the assets held solely in a custodial capacity by the County. 161 Indian River County, Florida Combining Statement of Changes in Assets and Liabilities Agency Fund For the Fiscal Year Ended September 30, 2014 ASSETS Cash and cash equivalents Investments Total assets LIABILITIES Accounts payable Due to other governments Other deposits held in escrow Total liabilities Balance October 1, 2013 Additions Deductions Balance September 30, 2014 $ 13,157,483 $ 339,568,153 $ 339,241,393 $ 13,484,243 43,708 43,708 $ 13,201,191 $ 339,568,153 $ 339,285,101 $ 13,484,243 $ 388,991 $ 61,483,979 $ 61,453,257 $ 4,430,980 295,071,041 294,857,080 8,381,220 36,421,749 36,383,380 $ 13,201,191 $ 392,976,769 $ 392,693,717 $ 162 419,713 4,644,941 8,419,589 13,484,243 1 1 1 1 1 1 i 1 1 1 Statistical Section 1 This part of the Indian River County Comprehensive Annual Financial Report presents detailed I information as a context for understanding what the information in the financial statements, note disclosures and required supplementary information says about the County's overall financial health. 1 Contents Page(s) I Financial Trends (Schedules 1 - 5) 164-174 These schedules contain trend information to help the reader understand how the County's financial performance and well-being have changed over time. IRevenue Capacity (Schedules 6 - 9) 175-179 These schedules contain information to help the reader assess the County's most 1 significant local revenue source, the property tax. Debt Capacity (Schedules 10 - 14) 180-187 1 These schedules present information to help the reader assess the affordability of the County's current levels of outstanding debt and the County's ability to issue additional debt in the future. 1 Demographic and Economic Information(Schedules 15 - 16)188-189 These schedules offer demographic and economic indicators to help the reader 1 understand the environment within which the County's financial activities take place. 1 Operating Information (Schedules 17 - 20) 190-201 These schedules contain service and infrastructure data to help the reader 1 understand how the information in the County's financial report relates to the services the County provides and the activities it performs. I Additional Bond Disclosures (Schedules 21 - 25) 202-206 These schedules provide information for required continuing disclosure for the water and sewer, golf course and spring training bonds. 1 1 Sources Unless otherwise noted, the information in these schedules is derived from the comprehensive annual financial report for the relevant year. 1 1 1 163 Indian River County, Florida Net Position by Component (Unaudited) Last Ten Fiscal Years (accrual basis of accounting) Governmental activities Net investment in capital assets Restricted Unrestricted Total governmental activities net position Business -type activities Net investment in capital assets Restricted Unrestricted 2005 2006 $ 264,193,976 150,019,583 60,737,524 $ 474,951,083 $ 278,213,361 158,046,966 121,561,389 $ 557,821,716 $ 134,402,945 $ 152,168,135 81,084,337 89,071,967 52,553,913 53,751,547 2007 $ 374,501,758 (A) 173,236,941 (B) 60,726,026 (B) 2008 $ 445,541,175 163,119,085 55,081,576 $ 608,464,725 $ 663,741,836 $ 174,540,682 83,840,471 47,338,783 Total business -type activities net position $ 268,041,195 $ 294,991,649 $ 305,719,936 Primary government Net investment in capital assets Restricted Unrestricted $ 398,596,921 $ 430,381,496 $ 549,042,440 231,103,920 247,118,933 257,077,412 113,291,437 175,312,936 108,064,809 Total primary government net position $ 742,992,278 $ 852,813,365 $ 914,184,661 (A) Completed construction and renovations for beach renourishment, County administration buildings, emergency operations center, five fire stations, County park improvements, and the purchase of environmentally sensitive lands. (B) The County reclassified special revenue funds from unrestricted to restricted net position (C) The County reclassified water and sewer funds from restricted to unrestricted net position. 164 $ 206,069,196 75,814,407 24,624,779 $ 306,508,382 $ 651,610,371 238,933,492 79,706,355 $ 970,250,218 Schedule 1 2009 2010 $ 461,709,848 158,306,364• 55,914,407 $ 675,930,619 $ 223,273,040 51,021,928 37,122,462 $ 311,417,430 $ 684,982,888 209,328,292 93,036,869 $ 987,348,049 $ 480,243,738 132,928,838 85,810,359 2011 2012 2013 2014 $ 492,300,301 $ 125,452,516 84,860,897 698,982,935 $ 223,375,337 $ 27,898,292 54,592,201 305,865,830 703,619,075 160,827,130 140,402,560 $ 1,004,848,765 702,613,714 $ 217,876,742 24,230,101 61,041,483 509,076,923 $ 121,189,228 76,523,757 706,789,908 $ $ 211,631,529 $ 17,941,773 70,286,599 303,148,326 $ $ 710,177,043 149,682,617 145,902,380 $ 1,005,762,040 165 299,859,901 $ 720,708,452 139,131,001 146,810,356 $ 1,006,649,809 518,255,719 •$ 117,321,755 71,830,421 707,407,895 $ 210,772,860 $ 20,871,037 68,686,611 $ 300,330,508 $ $ 729,028,579 $ 13 8,192, 792 140,517,032 $ 1,007,738,403 $ 514,764,316 116,203,827 72,873,567 703,841,710 211,660,190 - (C) 88,420,541 300,080,731 726,424,506 116,203,827 161,294,108 1,003,922,441 Indian River County, Florida Changes in Net Position (Unaudited) Last Ten Fiscal Years (accrual basis of accounting) 2005 2006 2007 2008 Expenses Govemmental activities: General government $ 18,165,441 $ 14,642,124 $ 15,506,424 $ 7,416,850 Public safety 54,271,542 58,578,985 42,050,455 (I) 70,973,212 (J) Physical environment 2,850,738 8,490,570 (D) 34,998,512 (D) 27,974,837 Transportation 21,726,741 22,011,006 26,173,989 25,742,974 Economic environment 696,448 1,077,731 950,024 4,583,763 (K) Human service 7,385,726 12,270,899 (E) 13,925,599 12,590,578 Cultural/recreation 10,775,291 11,546,217 31,196,252(G) 9,510,029 Court related 5,704,361 6,014,793 6,870,466 7,265,471 Interest on long-term debt 1,246,237 2,315,372 (F) 3,220,907 (F) 2,764,803 Total governmental activities expenses 122,822,525 136,947,697 174,892,628 168,822,517 Business -type activities. Water and sewer 30,260,577 33,387,825 Solid waste 19,156,896 (B) 11,558,323 Golf course 2,939,321 3,058,307 Other 3,768,301 4,202,588 Total business -type activities expenses 56,125,095 52,207,043 Total primary government expenses $ 178,947,620 $ 189,154,740 37,518,226 41,354,025 (L) 10,331,431 11,355,697 3,084,837 2,775,497 3,703,658 3,010,668 54,638,152 58,495,887 $ 229,530,780 $ 227,318,404 Prom -am Revenues Governmental activities: Charges for services. General government $ 8,779,557 $ 10,437,774 $ 7,957,770 $ 6,943,354 Public safety 4,712,594 7,151,354 5,728,644 5,754,082 Physical environment 631,456 854,219 1,447,553 972,865 Transportation 37,384,003 (C) 16,619,853 5,618,055 5,478,734 Human service 821,811 754,916 545,305 331,856 Cultural/recreation 800,555 5,480,612 2,425,679 1,730,471 Court related 2,294,908 2,466,882 2,800,680 2,971,093 Operating grants and contributions 16,310,024 (B) 13,420,891 25,561,608 (H) 15,227,659 Capital grants and contributions 6,069,586 13,081,116 13,441,915 29,165,641 (M) Total governmental activities program revenues 77,804,494 70,267,617 65,527,209 68,575,755 Business -type activities: Charges for services: Water and sewer 25,579,512 28,029,062 Solid waste 16,874,618 13,741,864 Golf course 3,247,815 3,306,424 Other 4,535,869 4,746,668 Operating grants and contributions 8,518,757 1,235,413 Capital grants and contributions 38,112,182 (A) 26,781,118 (A) Total business -type activities program revenues 96,868,753 77,840,549 Total primary government program revenues $ 174,673,247 $ 148,108,166 27,541,849 27,876,971 11,946, 566 10,758,812 3,374,772 3,313,994 3,250,585 2,726,888 72,828 217,751 9,729,371 10,802,859 55,915,971 55,697,275 $ 121,443,180 $ 124,273,030 Notes: (A) Contributions for water and sewer services by developers due to significant increase in County population. (B) Increase in revenue aid related expenses due to hurricane Frances and Jeanne in 2004, and hurricane Wilma in 2005 (C) Impact fees increased with building boom. (D) Environmentally sensitive lands purchased with bond proceeds. (E) Significant increase in SHIP programs due to population growth and building boom in 2005 (F) Issued new Limited G O.B. debt for $48,600,000 (G) Completed sections of beach renourishment program. (H) Grants received for beach renourishment, environmental sensitive lands, and various road projects. (I) Includes adjustment for prior years' public safety expenses. (J) Includes full year impact of increase in personnel, raises, and the depreciation and operating cost of new jail (K) Piper incentive of $4 million. (L) Increase in operating costs due to maintenance projects. (M) Received $16 million grant reimbursements for physical environment grants including beach restoration and stormwater (N) Increase due to $5 million contribution towards joint use library and increased depreciation for beach restoration projects. (0) Decrease due to reduced impact fees collections (slowdown in construction activity) (P) Received Neighborhood Stabilization Grant of $2.6 million. (Q) Contribution of$4.2 million for Sector 3 beach renourishment from Sebastian Inlet District. (R) State Shared Revenues reclassified to operating grants and contributions. 166 Schedule 2 2009 2010 2011 2012 2013 2014 $ 25,837,007 $ 23,506,576 $ 21,324,680 $ 19,069,181 $ 20,637,750 $ 22,968,835 71,221,082 68;235,492 67,393,943 66,456,674 66,178,467 66,954,956 813,580 1,405,690 1,353,074 2,424,109 1,858,307 1,031,710 23,711,653 20,861,672 22,300,819 23,629,799 26,286,998 23;577,720 661,897 2,525,988 2,056,453 1,986,091 2,550,157 1,084,204 8,453,562 7,370,995 7,762,962 7,749,253 6,818,023 7,136,042 24,559,117 (N) 16,009,122 16,484,242 18,089,432 19,369,326 16,610,269 6,765,203 6,251,773 5,774,032 5,635,245 5,835,184 6,360,814 2,906,802 2,714,422 2,526,114 2,350,241 2,087,204 1,944,229 164,929,903 148,881,730 146;976,319 147,390,025 151,621,416 147,668,779 37,523,097 34,748,276 33,818,640 34,246,967 33,815,749 35,821,287 10,407,437 10,683,984 10,3 70,476 10,659,004 10,405,143 10,801,408 2,937,141 2,715,607 2,537,665 2,451;603 2,537,525 2,588,424 2,168,894 1,858,420 1,623,862 1,487,515 1,547,815 1,833,528 53,036,569 50,006,287 48,350,643 48,845,089 48,306,232 51,044,647 $ 217,966,472 $ 198,888,017 $ 195,326,962 $ 196,235,114 $ 199,927,648 $ 198,713,426 $ 6,028,321 $ 5,889,678 $ 5,845,567 $ 5,304,385 $ 5,482,814 $ 5,895,424 5,884,118 5,267,209 6,076,085 5,852,093 6;625,924 8;025,849 636,219 21,006 24,204 20,923 5,900 20,970 2,157,456(0) 1,514;132(0) 2,090,194 2,345,186 2;768,107 3,365,961 204,299 295,812 346;689 358,279 213,485 211,294 1,322,785 1;328,225 1,340;550 1,397;660 1,765;912 1;883,347 2,375,430 545,967 501,980 414,356 1,301;135 3,592,298 11,077,388 15,772,265 (P) 7,926,832 8,230,411 26,921;514 (R) 22;229,254 15,032,731 7.016;429 (Q) 1,937,488 7,053,494 6,681,421 7,521,538 44,718,747 37;650.723 26,089,589 30,976.787 51,766,212 52,745,935 26,957,649 27,738,920 27,842;092 28,361,246 28,522,667 29,565,901 9,713,883 8,972,136 9,221,396 9,582,955 9,998,410 10,272,415 3,279,135 3,148,029 3,163,062 3;216.471 3,072;332 3,080,960 1,572,693 1,612,870 1,588,934 1;735,713 2,018,104 2;417,724 1,194,994 - 3,748,585 1,713,074 1,923,271 2,545,759 4,700,473 5,032,042 46,466,939 43,185.029 43,738,755 45;442;144 48,311,986 50,369,042 $ 91,185,686 $ 80,835,752 $ 69;828;344 $ 76,418,931 $ 100,078,198 $ 103,114,977 Continued 167 Indian River County, Florida Changes in Net Position (Unaudited) Last Ten Fiscal Years (accrual basis of accounting) 2005 2006 2007 2008 Net (Expense)/Revenue Governmental activities $ (45,018,031) $ (66,680,080) $ (109,365,419) $ (100,246,762) Business -type activities 40,743,658 (A) 25,633,506 1,277,819 (2,798,612) Total primary government net expenses $ (4,274,373) $ (41,046,574) $ (108,087,600) $ (103,045,374) General Revenues and Other Changes in Net Position Governmental activities: Property taxes, levied for Fneral purposes $ 71,698,850 $ 82,448,807 (B) $ 92,592,309 $ 92,483,561 Property taxes, levied for debt service 2,480,497 2,465,462 7,094,485 7,343,180 Sales and use taxes 21,892,558 21,855,885 20,738,502 20,088,899 Franchise fees 7,941,020 9,318,394 9,732,773 9,443,399 State shared revenues 14,022,896 13,043,670 12,368,421 11,596,227 Insurance recoveries 3,666,960 1,104,116 Interest earnings 4,414,772 12,163,993 16,004,890 10,347,019 Miscellaneous 1,235,708 2,089,540 1,583,343 2,170,033 Transfers (193,365) 5,060,846(C) (106,295) 2,051,555 Total governmental activities 127,189,896 149,550, 713 160,008,428 155,523,873 Business -type activities: State shared revenues - - - lnterest earnings 2,861,308 6,335,240 9,209,517 5,553,239 Miscellaneous 52,671 42,554 134,656 85,374 Transfers 193,365 (5,060,846) (C) 106,295 (2,051,555) Total business -type activities 3,107,344 1,316,948 9,450,468 3,587,058 Total primary government $ 130,297,240 $ 150,867,661 $ 169,458,896 $ 159,110,931 Change in Net Position Governmental activities $ 82,171,865 $ 82,870,633 $ 50,643,009 $ 55,277,111 Business -type activities 43,851,002 26,950,454 10,728,287 788,446 Total primary government change in net position $ 126,022,867 $ 109,821,087 $ 61,371,296 $ 56,065,557 Notes: (A) Growth in water and sewer services due to expansion of County population. (B) Taxable values increased by $2 billion. (C) Transfers for proportionate share of new County administration building. (D) Gain on sale of capital assets due to the privatization of the County landfill. (E) State Shared Revenues reclassified to operating grants and contributions. 168 Schedule 2 2009 2010 2011 2012 2013 2014 $ (120,211,156) $ (111,231,007) $ (120,886,730) $ (116,413,238) $ (99,855,204) $ (94,922,844) (6,569,630) (6,821,258) (4,611,888) (3,402,945) 5,754 (675,605) $ (126,780,786) $ (118,052,265) $ (125,498,618) $ (119,816,183) $ (99,849,450) $ (95,598,449) $ 87,265,989 $ 78,670,463 $ 69,856,750 $ 64,753,566 $ 62,305,177 $ 67,985,321 7,131,231 5,933,535 5,600,767 5,574,183 4,664,885 4,730,556 19,292,179 19,022,728 19,261,033 20,144,820 21,035,360 21,860,958 9,670,169 9,254,621 8,730,861 8,620,401 8,818,952 9,310,711 11,227,450 17,487,653 17.328,867 17,908,806 - (E) 5,747,573 2,079,873 1,299,894 668,012 637,099 542,542 2,018,901 2,061,415 3,082,481 3,079,701 2,903,771 2,459,033 (7,452,905) (25,965) (643,144) (32,957) - (44,000) 134,900,587 134,484,323 124,517,509 120, 716,532 100,365,244 106,845,121 417,500 - - - 3,685,805 1,173,512 723,870 600,116 427,041 381,497 7,893 70,181 562,651 (D) 8,400 37,812 331 7,452,905 25,965 643,144 32.957 - 44,000 11.564,103 1,269,658 1,929,665 641,473 464,853 425,828 $ 146,464,690 $ 135,753,981 $ 126,447,174 $ 121,358,005 $ 100,830,097 $ 107,270,949 $ 14.689,431 $ 23.253,316 $ 3,630,779 $ 4,303,294 $ 510,040 $ 11.922,277 4,994.473 (5,551,600) (2,682,223) (2,761,472) 470,607 (249,777) $ 19,683,904 $ 17,701,716 $ 948,556 $ 1,541 822 $ 980,647 $ 11.672,500 169 Indian River County, Florida Fund Balances, Governmental Funds (Unaudited) Last Ten Fiscal Years (modified accrual basis of accounting) 2005 2006 2007 2008 General Fund Reserved $ $ $ $ 8,000,000 Unreserved 30,152,425 45,300,882 50,321,956 44,874,259 Total general fund $ 30,152,425 $ 45,300,882 $ 50,321,956 $ 52,874,259 All other governmental funds Reserved $ 50,257,972 $ 38,075,117 $ 23,047,708 $ 49,667,320 Unreserved, reported in: Special revenue funds 115,822,479 183,318,603 149,564,925 96,950,614 Total all other governmental funds $ 166,080,451 $ 221,393,720 $ 172,612,633 $ 146,617,934 Total governmental funds $ 196,232,876 $ 266,694,602 $ 222,934,589 $ 199,492,193 General Fund Nonspendable Restricted Committed Assigned Unassigned Total general fund All other governmental funds Nonspendable Restricted Committed Assigned Unassigned Total all other governmental funds Total governmental funds Notes. (A) The County implemented GASB Statement 54 in fiscal year 2010 (B) Reclassified emergency/disaster and budget stabilization reserves from Committed to Unassigned fund balance categories. 170 Schedule 3 2009 2010(A) 2011 2012 2013 2014 $ 8,000,000 $ N/A $ N/A $ N/A $ N/A $ N/A 47,616,773 N/A N/A N/A N/A N/A $ 55,616,773 $ N/A $ N/A $ N/A $ N/A $ N/A $ 53,252,040 $ N/A $ N/A $ N/A $ N/A $ N/A N/A N/A N/A N/A N/A 91,600,421 N/A N/A N/A N/A N/A $ 144,852,461 $ N/A $ N/A $ N/A $ N/A $ N/A $ 200,469,234 $ N/A $ N/A $ N/A $ N/A $ N/A $ 162,760 $ 363,619 $ 311,241 $ 1,224,835 $ 1,134,846 18,290 50,015 1,120,087 1,000,000 1,000,000 21,757,565 21,041,045 2,374,790 (B) 2,370,079 1,223,183 1,415,000 1,660,000 1,808,000 900,000 33,160,873 33,694,612 48,722,929 (B) 44,385,674 48,320,836 $ 56,514,488 $ 56,809,291 $ 54,337,047 $ 49,880,588 $ 51,678,865 $ 2,316,373 $ 814,858 $ 557,128 $ 50,788 $ 39,337 130,175,284 125,082,370 1 16,3 79,943 112,523,743 112,266,321 4,691,573 4,661,146 1,483,393 1,481,312 1,492,929 9,471,022 10,013,457 11,288,602 8,964,238 8,139,695 (1,184,722) (354,995) (202,971) (339,223) (201,587) $ 145,469,530 $ 140,216,836 $ 129,506,095 $ 122,680,858 $ 121,736,695 $ 201,984,018 $ 197,026,127 $ 183,843,142 $ 172,561,446 $ 173,415,560 171 Indian River County, Florida Changes in Fund Balances, Governmental Funds (Unaudited) Last Ten Fiscal Years (modified accrual basis of accounting) Revenues Taxes Permits, fees, and special assessments Intergovernmental Charges for services Judgments, fines and forfeits Interest Miscellaneous Total Revenues Expenditures Current: General government Public safety Physical environment Transportation Economic environment Human service Culture/recreation Court related Debt service. Principal Interest and fiscal charges Capital outlay Total Expenditures Excess of revenues over (under) expenditures Other Financing Sources (Uses) Debt issuance Payments from capital leases Transfers out Transfers in Total other financing sources (uses) Net change in fund balances Debt service as a percentage of noncapital expenditures 2005 $ 104,012,925 38,043,246 35,973,818 18,151,546 1,715,875 4,083,164 1,398,166 203,378,740 2006 $ 116,088,548 26,285,557 38,261,489 18,204,600 2,069,593 10,574,489 4,597,369 216,081,645 2007 $ 130,158,069 8,397,437 54,252,074 18,997,529 2,403,093 15,777,318 3,495,610 2007 $ 130,158,069 8,397,437 54,252,074 18,997,529 2,403,093 15,777,318 3,495,610 233,481,130 233,481,130 20,107,020 21,831,839 24,815,255 24,815,255 57,045,359 65,975,870 72,907,822 72,907,822 2,989,117 8,955,262 34,324,331 34,324,331 21,285,597 30,610,413 49,503,680 49,503,680 713,019 1,054,239 968,227 968,227 7,270,391 12,470,222 13,862,463 13,862,463 15,062,134 16,380,438 23,751,173 23,751,173 5,630,734 5,915,727 6,649,724 6,649,724 2,239,663 2,615,659 4,870,876 4,870,876 1,255,837 1,790,431 3,255,767 3,255,767 15,779,577 37,848,475 42,489,997 42,489,997 149,378,448 205,448,575 277,399,315 277,399,315 54,000,292 10,633,070 (43,918,185) (43,918,185) (193,365) (193,365) 49,996,735 (236,067) 10,067,988 59,828,656 $ 53,806,927 $ 70,461,726 3.0% 3 4% (A) Early call of remaining General Obligation Bonds, Series 2001 of $3 6 million. (B) Payoff of portion of Spring Training Bonds, Series 2001 of $2.275 million. 172 264,467 (19,736,023) 19,629,728 158,172 264,467 (19,736,023) 19,629,728 158,172 $ (43,760,013) $ (43,760,013) 4 8% 4 8% Schedule 4 2009 2010 2011 2012 2013 2014 $ 113,689,399 $ 12,433,598 34,305,682 16,852,653 1,792,517 5,721,869 2,489,532 187,285,250 103,626,726 11,322,039 37,687,574 14,665,805 852,012 2,061,385 2,383,493 172,599,034 $ 94,718,550 11,189,3 93 30,453,182 15,030,329 936,995 1,173,103 4,175,614 $ 90,472,569 11,486,235 29,759,832 14,760,125 739,275 613,023 5,237,426 157,677,166 153,068,485 $ 88,005,422 12,769,844 30,086,479 15,887,241 778,575 570,559 3,841,294 151,939,414 $ 94,585,345 14,321,389 30,563,650 18,076,888 1,004,374 463,274 3,221,548 162,236,468 22,566,113 20,894,116 19,271,196 20,477,898 19,056,322 20,681,570 74,813,164 71,489,613 70,432,615 67,761,985 66,908,328 67,799,667 910,213 1,131,173 1,371,734 1,751,623 771,942 781,306 38,111,512 27,497,907 28,432,207 29,058,310 28,223,229 23,321,248 653,547 2,520,339 2,099,698 2,021,184 2,581,401 1,106,886 8,621,760 7,267,406 7,625,369 6,888,883 6,952,460 7,178,542 15,450,688 18,453,642 14, 706,194 13,808,303 11,538,809 11,627,286 6,620,830 6,214,831 5,983,085 5,860,925 6,054,822 6,487,906 5,120,000 5,315,000 4,270,000 8,060,000 (A) 6,050,000 (B) 3,700,000 2,948,758 2,758,138 2,562,374 2,426,083 2,118,704 1,984,616 10,435,212 7,487,068 5,825,287 8,108,370 13,037,552 16,560,991 186,251,797 171,029,233 162,579,759 166,223,564 163,293,569 161,230,018 1,033,453 1,569,801 (4,902,593) (13,155,079) (11,354,155) 1,006,450 (14,366,145) 14,309,733 (56,412) $ 977,041 (17,057,014) 17,001,997 (55,017) 1,514,784 (8,918,267) (11,622,984) 8,862,969 11,595,078 (55,298) (27,906) (12,540,187) 12,504,699 (10,244,980) 10,092,644 (35,488) (152,336) $ (4,957,891) $ (13,182,985) $ (11,389,643) $ 854,114 5 4% 5.6% 5 0% 7.6% 6 0% 4.3% 173 Indian River County, Florida Tax Revenues by Source, Governmental Funds (Unaudited) Last Ten Fiscal Years (modified accrual basis of accounting) Schedule 5 Fiscal Year Property (A) 2005 $ 74,179,347 2006 84,914,269 2007 99,686,794 2008 99,826,741 2009 94,397,220 2010 84,603,998 2011 75,457,517 2012 70,327,749 2013 66,970,062 2014 72,715,877 Sales & Use Tourist Franchise (B) Gasoline Other Total $ 15,582,689 $ 1,675,781 $ 7,941,020 $ 3,573,036 $ 1,061,052 $ 104,012,925 15,736,078 1,517,360 9,318,394 3,526,774 1,075,673 116,088,548 14,549,834 1,449,083 9,732,773 3,482,514 1,257,071 130,158,069 13,714,228 1,584,514 3,218,705 1,571,452 119,915,640 13,023,095 1,294,163 3,369,962 1,604,959 113,689,399 12,660,518 1,324,953 - 3,498,698 1,538,559 103,626,726 12,942,483 1,487,060 3,346,362 1,485,128 94,718,550 13,708,911 1,604,920 3,329,183 1,501,806 90,472,569 14,422,829 1,743,283 3,303,751 1,565,497 88,005,422 15,228,304 1,918,201 3,294,709 1,428,254 94,585,345 (A) The County's primary source of revenue is property taxes, amounting to 77 percent of Governmental Funds tax revenues in 2014 Consequently, supplemental required schedules are provided only for property tax revenues. (B) Effective 10/01/07, the State of Florida changed its uniform accounting manual to remove franchise fees from the taxes designation. 174 1 Indian River County, Florida I Assessed Value and Actual Value of Taxable Property (Unaudited) Last Ten Fiscal Years Schedule 6 Real Personal Less: Total Taxable Total I Fiscal Property Property Total Tax Exempt Assessed Direct Year Actual Value Actual Value Actual Value Property Value Tax Rate I2005 $ 15,716,463,269 $ 699,716,008 $ 16,416,179,277 $ 4,236,183,618 $ 12,179,995,659 5 1563 2006 19,265,033,998 712,011,582 19,977,045,580 5,734,060,645 14,242,984,935 4.9173 1 2007 25,458,676,130 755,187,275 26,213,863,405 8,366,701,791 17,847,161,614 4.3250 2008 25,155,652,635 782,529,196 25,938,181,831 7,357,884,893 18,580,296,938 4.1037 1 2009 24,141,420,963 739,467,578 24,880,888,541 7,431,618,464 17,449,270,077 4.1493 2010 21,272,439,325 761,011,306 22,033,450,631 6,237,291,938 15,796,158,693 41666 1 2011 18,741,543,869 711,180,228 19,452,724,097 5,313,689,267 14,139,034,830 41625 2012 17,291,910,945 644,205,795 17,936,116,740 4,731,112,173 13,205,004,567 41625 I 2013 16,563,604,291 635,119,066 17,198,723,357 4,497,471,382 12701251975 4.1625 II2014 16,832,196,339 697,294,522 17,529,490,861 4,670,052,667 12,859,438,194 4.3353 Source: Indian River County Property Appraiser; values are established as of January 1 of the previous Icalendar year, i e., January 1, 2013 taxable values apply to the fiscal year ending September 30, 2014. The actual value is based upon market values in the area. Property is assessed at the actual values less various exemptions for homestead, age, disability, widows, religious, charitable, educational and Igovernmental situations Total taxable values are also presented on Schedules 8 and 11. 1 11 1 1 1 1 175 1 Indian River County, Florida Property Tax Rates Direct and Overlapping Tax Rates (Unaudited) Last Ten Fiscal Years 2005 2006 2007 2008 County direct rate General fund 3.6233 3 5204 3.1914 3 0202 I Municipal service 1.5330 1.3969 1.1336 1 0835 Total direct rate (A) 5 1563 4.9173 4.3250 4.1037 County -wide district school board rate 8.4990 8.2400 7.4430 7.5380 Other County -wide rates Emergency Management Services District 1 9836 1.9911 1.7639 1.7201 e Land acquisition bond 0.2106 0.1789 0.4108 0 4082 Total other County -wide rates 2.1942 2.1700 2.1747 2.1283 Total County -wide rate (B) 15 8495 15.3273 13.9427 13.7700 City rates Fellsmere 5 7500 5.7500 5.7500 4.4301 Indian River Shores 1 4730 1.4730 1.4730 1.3923 Sebastian 4.5904 3.9325 3.0519 2.9917 Orchid 0.7508 0 6900 0.4525 0 4494 Vero Beach 2.1425 2.2925 2.1425 1.9367 Average of cities rates 2.9413 2.8276 2.5740 2.2400 Other special district rates 1.8923 1.6082 1.4795 1.3817 (A) Per Florida State Statute 200.081, no ad valorem tax millage shall be levied against real property and tangible personal property by counties in excess of 10 mills, except for voted levies. (B) Total County -wide rate is borne by all property owners within the County boundaries. Source. Indian River County Property Appraiser 1 1 1 I 1 1 1 176 1 Schedule 7 2009 2010 2011 2012 2013 2014 3 0689 3 0892 3 0892 3.0892 3.0892 3.2620 1 0804 1 0774 1 0733 1 0733 1 0733 1 0733 4.1493 4 1666 4.1625 4.1625 4 1625 4.3353 7 0400 7.5960 8.2500 8.2440 8.3130 8.1160 1 7148 1.7148 1 7148 1 7148 1.7148 1.9799 0.4220 0.3879 0.4087 0.4364 0.3799 0.3788 2.1368 2.1027 2 1235 2 1512 2.0947 2.3587 13.3261 13.8653 14 5360 14.5577 14.5702 14 8100 4 4300 4 4300 4 4300 5.2455 5 4999 5 6190 1.3923 1.3923 1 4105 1 4731 1 4731 1 4731 3.3456 3.3456 3.3041 3.3041 3.7166 3 7166 0.4550 0.4550 0.4550 0 4550 0.5000 0 4864 1 9367 1 9367 1 9367 2.0336 2.0336 2.0336 2.3119 2.3119 2.3073 2.5023 2.6446 2.6657 1.5362 1 7515 1 7663 1.6856 1 6859 1.7128 177 Indian River County, Florida Principal Property Taxpayers (Unaudited) Year 2014 and Year 2005 Schedule 8 2014 2005 1 Real Percentages Real Percentages Property of Total Property of Total Assessed Assessed Assessed Assessed Taxpayer Valuation Rank Valuation Valuation Rank Valuation Florida Power & Light $ 104,169,885 1 0 81 $ 74,389,385 2 0.61 9 Disney Vacation Dev. Inc. 70,980,390 2 0.55 87,106,518 1 0 72 Windsor Properties 37,435,960 3 0.29 41,680,450 5 0.34 9 BellSouth Telecomm Inc. 36,274,996 4 0.28 57,424,922 3 0 47 111 Adult Community Services Inc. 32,546,340 5 0.25 33,407,820 8 0.27 Beachlen II LLC 31,610,580 6 0.25 John's Island Club Inc. 30,565,160 7 0.24 35,832,632 6 0.29 I.R. Mall Associates Ltd. 28,501,910 8 0.22 53,842,380 4 0 44 Fellsmere Joint Venture 26,024,499 9 0.20 31,059,035 9 0.26 Health Care REIT Inc 24,434,920 10 0 19 Wal-Mart Stores 27,953,002 10 0.23 The New Piper Aircraft 35,086,320 7 0.29 Total Principal Property Taxpayers Real Property Assessed Valuation $ 422,544,640 3.28% $ 477,782,464 3.92% Total County Taxable Valuation $ 12,859,438,194 $ 12,179,995,659 (from schedule 6) 1 1 Source: Indian River County Property Appraiser 1 1 178 1 Indian River County, Florida Property Tax Levies And Collections (Unaudited) Last Ten Fiscal Years Schedule 9 Year Percent of Percent of Total Current Current Tax Delinquent Total Total Tax Tax Tax Collections Tax Tax Collections Levy Collections To Tax Levy Collections (1) Collections To Tax Levy 2005 $ 76,748,078 $ 73,991,702 96 41 $ 111,220 $ 74,102,922 96.55 2006 87,754,823 84,736,835 96.56 34,344 84,771,179 96.60 2007 102,986,045 99,404,127 96.52 61,566 99,465,693 96.58 2008 103,700,766 99,716,496 96.16 48,241 99,764,737 96.20 2009 97,439,623 94,107,423 96.58 273,002 94,380,425 96 86 2010 87,360,868 84,431,741 96.65 171,392 84,603,133 96 84 2011 77,790,733 75,215,452 96 69 290,472 75,505,924 97 06 2012 72,668,518 70,200,922 96.60 133,385 70,334,307 96.79 2013 69,251,173 66,838,348 96 52 111,341 66,949,689 96.68 2014 75,101,883 72,572,593 96 63 149,546 72,722,139 96 83 All taxes are due and payable on November 1 of each year or as soon thereafter as the assessment roll is certified and delivered to the Tax Collector All unpaid taxes become delinquent on April 1 following the year in which they are assessed. Discounts are allowed for early payment at the rate of 4% in the month of November, 3% in the month of December, 2% in the month of January and 1% in the month of February The taxes paid in March are without discount. (1) On or prior to June 1 following the tax year, certificates are sold for all delinquent taxes on real property After the sale; tax certificates bear interest of 18% per year or at any lower rate bid by the buyer Application for a tax deed on any unredeemed tax certificates may be made by the certificate holder after a period of two years Unsold certificates are held by the County Delinquent taxes on personal property bear interest of 18% per year until the tax is satisfied either by seizure and sale of the property or by the seven year statute of limitations The County does not accrue its portion of the County -held certificates due to the immaterial amount. Source: Indian River County Property Appraiser and Tax Collector provided the above information, consequently, the reported collections on this schedule will vary from the actual collections as reported on Schedule 5. The Tax Collector does not report the interest earnings on the collections, however, the Board includes those interest earnings as part of the total tax collection. 179 1 Indian River County, Florida Ratios of Outstanding Debt by Type (Unaudited) Last Ten Fiscal Years Governmental Activities Business -type Activities I General Spring Training Recreational Obligation Capital Facility Bonds Revenue Capital Water & Sewer Year Bonds (A) Leases 2001 Series Bonds (B) Leases Bonds (C) 2005 $ 14,385,000 $ 380,275 $ 15,025,000 $ 5,544,471 $ 263,237 $ 64,809,132 2006 62,630,060 - 14,520,000 5,089,099 193,786 62,416,115 I 2007 58,441,835 8,591 14,000,000 4,618,728 110,025 59,908,097 1 2008 53,958,611 - 13,455,000 4,138,356 28,126 57,285,080 2009 49,305,387 - 12,895,000 3,652,985 - 56,123,413 1 2010 44,482,163 12,310,000 3,147,614 - 53,016,507 2011 40,723,939 - 11,705,000 2,632,243 - 49,789,603 2012 33,200,714 - 11,075,000 2,101,871 46,462,698 1 2013 29,987,489 - 8,145,000 - - 43,020,793 2014 26,639,265 - 7,700,000 - - 39,433,889 1 (A) General Obligation Bonds include Series 2001 and Limited General Obligation Bonds, Series 2006. The remaining balance of the 2001 issue was called early on July 1, 2012. This information is also presented on Schedules 11 and 13. (B) Recreational Revenue Refunding Bonds, Series 2003. The remaining balance was called early on September 30, 2013. (C) Water & Sewer Bonds include Series 1993, Refunding Series 2005, and Series 2009. (D) Information not available. (E) Refer to Schedule 15 for personal income and population information Further information may be found in Note 13. Source of per capita income is University of Florida, Bureau of Economic and Business Research. 1 1 1 1 180 1 1 iSchedule 10 1 Percentage Total of Total Debt Debt Primary to Personal Per 1 Government Income (E) Capita (E) $ 100,407,115 1.57% $ 773 1 144,849,060 2.07 1,071 1 137,087,276 1.76 981 128,865,173 1.68 910 1 121,976,785 1.60 862 I112,956,284 1.69 818 104,850,785 1 48 756 1 92,840,283 1.25 666 81,153,282 1 05 581 1 73,773,154 (D) 523 1 1 0 1 1 1 1 1 1 181 Indian River County, Florida Ratio of Net General Bonded Debt Outstanding to Taxable Value and Net Bonded Debt per Capita (Unaudited) Last Ten Fiscal Years Schedule 11 Ratio Of Gross General Debt Service Net Bonded Net Bonded Fiscal Taxable Obligation Monies Net Bonded Debt To Debt Per Year Population (A) Value (A) Bonded Debt Available (A) Debt Taxable Value Capita 2005 130,043 $ 12,179,995,659 $ 14,385,000 $ 1,106,353 $ 13,278,647 0 0011 $ 102.1097 2006 135,262 14,242,984,935 62,630,060 1,375,837 61,254,223 0 0043 452.8561 2007 139,757 17,847,161,614 58,441,835 1,956,189 56,485,646 0 0032 404 1704 2008 141,667 18,580,296,938 53,958,611 2,530,612 51,427,999 0 0028 363 0203 2009 141,475 17,449,270,077 49,305,387 2,841,769 46,463,618 0 0027 328.4228 2010 138,028 15,796,158,693 44,482,163 1,845,314 42,636,849 0.0027 308.9000 2011 138,694 14,139,034,830 40,723,939 1,743,781 38,980,158 00028 2810515 2012 139,446 13,205,004,567 33,200,714 1,002,540 32,198,174 0 0024 230.9007 2013 139,586 12,701,251,975 29,987,489 828,029 29,159,460 0 0023 208.8996 2014 140,955 12,859,438,194 26,639,265 832,464 25,806,801 0 0020 183 0854 (A) Columns are provided as additional information for General Obligation Bonds (G.O.B.), Series 2001 and Limited G 0 B , Series 2006 The remaining balance of the 2001 issue was called early on July 1, 2012 Total taxable values are also presented in Schedule 6. Gross G 0.B debt is also presented on Schedules 10 and 13 Total taxable assessed values also appear on Schedule 6. Source of population data is the University of Florida, Bureau of Economic and Business Research. 182 Indian River County, Florida Computation of Legal Debt Margin (Unaudited) September 30, 2014 Schedule 12 Computation of the Legal Debt Margin is omitted because the Constitution of the State of Florida (F.S. 200.181) and Indian River County set no legal debt limit. 183 Indian River County, Florida Direct and Overlapping Governmental Activities Debt (Unaudited) September 30, 2014 Schedule 13 Governmental Unit Debt repaid with property taxes. Indian River County Limited General Obligation Bonds, Series 2006 Revenue Bonds - Spring Training Facility - Series 2001 Total direct debt of County: Other debt: Indian River County School District Certificates of Participation Total overlapping debt: Total direct and overlapping debt: Debt Outstanding $ 26,639,265 7,700,000 Percentage Applicable Share of Overlapping Debt 100% $ 26,639,265 100 7,700,000 117,552,599 (A) 100 34,339,265 117,552,599 117,552,599 $ 151,891,864 (A) Indian River County School District, as of June 30, 2014 Source: Information on outstanding debt provided by the Indian River County School District Finance Department. Note. Overlapping debt is borne by all property owners within the County boundaries. 184 00 ell1 — OEM .N ® a® aa® 11111111 UM O ,® Os ® — M — EMI =I Indian River County, Florida Pledged Revenue Coverage (Unaudited) Water and Sewer Revenue Bonds (Series 1993A, 1996, 2005, 2009) Last Ten Fiscal Years Uniform Charges Water sales Wastewater sales Other Total uniform charges Septage/Sludge Surcharges Interest earnings 1989/1990 Special assessments 1996 Special assessments Gross revenues Less. Direct expenses Net revenues available for debt service Annual debt service Principal Interest Total debt service payment Debt service coverage 2005 2006 $ 12,146,416 $ 10,437,091 1,685,502 24,269,009 269,575 242,451 2,264,132 722,922 13,336,623 $ 11,634,181 1,744,486 26,715,290 332,329 244,166 4,554,419 60,229 350,712 2007 2008 13,529,341 $ 12,003,677 1,386,198 26,919,216 290,955 243,919 6,576,873 21,138 268,883 13,435,398 12,128,706 1,460,143 27,024,247 256,785 245,343 3,650,480 112 220,754 27,768,089 32,257,145 34,320,984 31,397,721 12, 853, 872 14,270,414 16,226,651 17,147,444 14,914,217 $ 17,986,731 $ 18,094,333 $ 14,250,277 2,020,000 $ 3,525,573 2,390,000 $ 2,505,000 $ 3,157,260 3,041,150 2,620,000 2,922,950 5,545,573 $ 5,547,260 $ 5,546,150 $ 5,542,950 2.69x 3.24x 3.26x 2.57x Note: In accordance with Water and Sewer Revenue Refunding Bonds, Series 2005 bond covenants, there are items included in the debt service coverage calculation other than normal operating revenues. These items include surcharges and collections on special assessments. Expenses specifically excluded: renewal and replacement, depreciation, amortization and interest expense, and loss on disposal of equipment. Note Water and Sewer debt information can be found in Note 13. 186 1 1 1 1 1 1 1 1 1 i 1 1 1 1 1 1 1 1 Schedule 14 2009 2010 2011 2012 2013 2014 $ 13,001,743 $ 13,570,657 $ 13,565,766 $ 13,621,878 $ 13,667,115 $ 14,059,231 11,954,333 12,375,346 12,203,750 12,515,394 12,546,429 12,879,006 1,285,605 1,430,966 1,639,985 1,727,411 1,763,426 2,025,378 26,241,681 27,376,969 27,409,501 27,864,683 27,976,970 28,963,615 294,459 302,187 314,969 373,616 426,634 478,555 244,619 245,011 245,245 246,298 246,363 242,073 2,110,031 686,776 491,260 315,377 239,270 258,741 413 438 8,718 - 184,272 151,316 93,513 75,037 69,757 22,091 29,075,475 28,762,697 28,563,206 28,875,011 28,958,994 29,965,075 17,057,273 16,007,055 15,404,503 15,657,085 15,217,294 16,040,433 $ 12,018,202 $ 12,755,642 $ 13,158,703 $ 13,217,926 $ 13,741,700 $ 13,924,642 $ 2,745,000 $ 2,870,000 $ 2,990,000 $ 3,090,000 $ 3,205,000 $ 3,350,000 2,047,513 2,510,910 2,324,525 2,193,450 2,080,951 1,937,450 $ 4,792,513 $ 5,380,910 $ 5,314,525 $ 5,283,450 $ 5,285,951 $ 5,287,450 2.51x 2.37x 2 48x 2.50x 2 60x 2.63x 187 Indian River County, Florida Demographic and Economic Statistics (Unaudited) Last Ten Years Schedule 15 Year Total Per Capita Personal Personal Unemployment Population (A) Income (B) Income (B) Rate (C) 2005 130,043 $ 6,386,893,000 $ 50,369 4.7 2006 135,262 7,002,160,000 54,045 4.7 2007 139,757 7,810,408,000 59,419 7.3 2008 141,667 7,669,062,000 57,107 10.1 2009 141,475 7,610,327,000 47,689 15.2 2010 138,028 6,687,691,000 48,378 15.2 2011 138,694 7,090,634,000 51,041 13.7 2012 139,446 7,429,653,000 52,855 11.3 2013 139,586 7,731,263,000 54,448 8.8 2014 140,955 (D) (D) 7.9 Sources: (A) University of Florida, Bureau of Economic and Business Research (B) US Department of Commerce, Bureau of Economic Analysis (C) Florida Agency for Workforce Innovation (D) Information not available The population and personal income information is used in Schedule 10 for calculation of Debt Per Capita and Percentage of Debt to Personal Income. 188 Indian River County, Florida Principal Employers (Unaudited) Year 2014 and Year 2005 Schedule 16 Employer 2014 Percentage Number of of Total County Employees Employment School District of Indian River County 2,113 3.67 % Indian River County * 1,328 2.30 Indian River Medical Center 1,753 3.04 Publix Supermarkets 1,250 2.17 Piper Aircraft Inc. 850 1.47 Sebastian River Medical Center 569 0.99 John's Island 526 0.91 City of Vero Beach 424 0.74 Visiting Nurse Association 399 0.69 Indian River Estates 350 0.61 Total 9,562 16.59 % Total County Employees 57,629 Employer 2005 Percentage Number of of Total County Employees Employment School District of Indian River County 2,106 3.85 % Indian River County* 1,824 3.34 Indian River Medical Center 1,549 2.83 Publix Supermarkets 950 1.74 Piper Aircraft Inc. 974 1.78 City of Vero Beach 600 1.10 Sebastian River Medical Center 525 0.96 John's Island 475 0.87 Hale Groves 470 0.86 Wal-Mart 462 0.85 Total 9,935 18.18 % Total County Employees 54,661 Source: Indian River County, Florida annual budgets for individual employers. Florida Agency for Workforce Innovation - Labor Market Statistics, and Bureau of Economic and Business Research at University of Florida for total County employment figures. * This includes the Board of County Commissioners, Clerk of the Circuit Court, Supervisor of Elections, Property Appraiser, Sheriff, and the Tax Collector 189 Indian River County, Florida Building Permits (Unaudited) Last Ten Fiscal Years Indian River County Munici- Fiscal # of New # of Additions & # of New Year Permits Construction Permits Alterations Permits Construction 2005 4,770 $ 703,972,409 4,409 $ 57,549,895 1,147 $ 262,135,977 2006 3,760 754,817,641 5,630 43,898,675 826 185,556,022 2007 1,404 280,056,839 3,899 38,290,132 269 107,099,115 2008 857 222,191,316 2,686 30,731,235 206 104,188,514 2009 442 97,694,608 1,725 17,102,312 122 41,039,432 2010 394 82,995,613 2,017 20,723,725 122 30,048,727 2011 416 96,301,948 2,288 26,368,020 112 27,812,429 2012 421 95,703,031 2,591 25,060,272 150 37,380,374 2013 562 159,419,936 3,165 32,572,696 278 63,277,504 2014 611 190,750,218 4,290 41,977,079 262 81,288,256 Source Building Departments - Indian River County (including the City of Vero Beach), Town of Orchid, Town of Indian River Shores, City of Sebastian, and City of Fellsmere. 190 Schedule 17 palities Countywide # of Additions & # of New # of Additions & Permits Alterations Permits Construction Permits Alterations 13,062 $ 119,403,505 5,917 $ 966,108,386 17,471 $ 176,953,400 7,072 65,822,951 4,586 940,373,663 12,702 109,721,626 3,712 53,482,334 1,673 387,155,954 7,611 91,772,466 2,850 40,039,893 1,063 326,379,830 5,536 70,771,128 2,188 34,072,491 564 138,734,040 3,913 51,174,803 2,948 32,545,131 516 113,044,340 4,965 53,268,856 2,973 42,087,897 528 124,114,377 5,261 68,455,917 3,271 43,011,051 571 133,083,405 5,862 68,071,323 4,433 45,723,356 840 222,697,440 7,598 78,296,052 5,049 57,293,148 873 272,038,474 9,339 99,270,227 191 Indian River County, Florida Operating Indicators by Function/Program (Unaudited) Last Ten Fiscal Years Function/Program 2005 2006 2007 2008 General Government Purchasing 2,554 2,734 2,753 2,520 Purchase orders issued Public Safety Fire rescue Vehicle rescue response 10,602 6,880 32,488 (A) 33,845 Fire code inspections 2,215 2,420 2,593 3,527 Advanced life support calls 5,623 10,728 7,537 5,862 Basic life support calls (transport only) 4,606 11,105 3,643 5,759 Sheriff Arrests 5,172 5,211 5,012 5,620 Violent crimes 300 652 338 353 Non-violent crimes 3,930 3,462 6,192 6,383 Total calls for service 122,893 131,489 126,490 129,389 Building department Construction permits issued 4,770 3,760 1,404 857 Estimated value of construction (millions) $ 704 0 $ 754.8 $ 280 1 $ 222.2 Physical Environment Solid waste Waste stream tonnage received 529,238 380,109 295,977 239,296 Total recycled material (tons) 129,869 70,919 57,247 42,088 Utilities - water & sewer Number of water customers 34,867 43,477 41,101 42,000 Number of wastewater customers 20,237 25,943 24,666 25,000 Water ERUs 53,032 54,070 61,494 61,558 Wastewater ERUs 38,387 41,351 45,396 45,785 Water consumption (Average Daily Demand) 7,780,000 8,370,000 8,790,000 8,603,000 (A) Effective September 18, 2006, fire and advanced life support combined into fire rescue. Source. Internal reports prepared by the various departments of Indian River County. 192 1 1 Schedule 18 I 2009 2010 2011 2012 2013 2014 2,463 1,970 1,805 1,852 1,740 1,760 1 I 34,480 34,529 37,550 39,316 39,340 41,540 5,917 2,358 2,239 1,874 1,992 1,753 9,085 9,751 10,935 10,904 10,991 11,283 I3,486 3,269 3,077 3,406 3,544 3,851 4,331 5,065 4,464 3,144 3,885 4,262 340 310 394 107 439 552 I 6,099 5,719 6,058 6,063 5,683 5,853 138,998 154,480 162,944 176,170 199,687 216,082 I 442 394 416 421 562 611 $ 97 7 $ 83 0 $ 96.3 $ 95.7 $ 159 4 $ 190 8 1 207,344 201,561 180,434 205,355 211,382 265,278 40,931 45,298 30,424 53,255 50,792 101,444 1 42,972 43,723 44,254 44,571 45,216 46,223 25,192 25,205 25,465 25,773 26,233 26,948 63,147 64,146 64,391 64,820 65,477 66,261 I45,319 45,427 45,863 46,107 46,576 47,027 8,700,000 8;225,000 8,198.000 7,798,000 7,558,000 8,620;000 1 1 1 1 1 1 1 Continued 1 193 Indian River County, Florida Operating Indicators by Function/Program (Unaudited) Last Ten Fiscal Years Function/Program 2005 2006 2007 2008 Transportation Public works Projects under design 4 5 5 6 Projects awarded for construction 4 5 5 Construction projects completed 4 5 5 County engineering Roads designed 6 11 7 8 Miles of roads designed 1.71 6.50 3.50 6 00 Traffic engineering Site plans reviewed 1,274 1,135 520 332 Culture/Recreation Library Circulation (County -wide) 1,079,206 1,140,904 1,188,366 1,250,075 Recreation department Total beach park attendance N/A N/A N/A 415,051 Athletic and event attendance N/A N/A N/A 8,673 Aquatic centers attendance 89,000 93,088 90,503 90,475 Shooting range Safety/Registration cards issued 3,718 6,036 6,784 6,784 Golf course Rounds played 97,465 107,048 100,539 104,716 Court Related Law library Circulation 26,481 26,255 24,759 21,107 (B) Law library circulation is now included in the County -wide Library Circulation. 194 Schedule 18 2009 2010 2011 2012 2013 2014 29 13 26 19 20 43 5 7 7 10 5 7 12 6 8 8 5 20 5 6 4 4 6 8 5.00 6.00 1.00 8.00 6.00 8.35 423 271 218 290 357 387 1,314,372 1,403,367 1,362,857 1,277,253 1,300,764 (B) 1,317,458 437,302 467,434 449,213 420,609 404,287 434,397 14,730 23,750 24,112 23,979 23,841 23,900 89,787 87,107 98,515 97,965 97,183 105,459 9,050 6,471 8,176 8,302 8,462 7,911 101,810 96,593 94,713 96,723 91,770 90,306 18,512 13,079 9,168 9,428 N/A (B) N/A 195 i Indian River County, Florida Full -Time Equivalent County Government Employees by Function/Program (Unaudited) Last Ten Fiscal Years 2005 2006 2007 2008 General Government Board of County Commissioners 10 10 10 11 County Attorney 6 6 7 7 Administration 3 3 3 3 Financial/Administrative Service 23.5 24.5 25.5 26.5 Comprehensive Planning 23 23 23 23 Other 42 50 62 49 Clerk of Circuit Court 108 113 118 116 Property Appraiser 47 49 50 45 Supervisor of Elections 11.5 11.5 12 12 Tax Collector 40 40 40 38 Public Safety Fire Department 144.5 233 232 241 Advanced Life Support 82 - (A) Sheriff - Corrections 130 200 197 197 Sheriff - Court Service 25.5 26 29.5 29.5 Sheriff - Law Enforcement 276 276 301 301 Building Department 45 49 50 33 Other 17.5 11 12 12 Physical Environment Solid Waste 53 53 53 51 Utilities - water and sewer 126 131 139 130 Other 11 13 14 15 Transportation Road and Bridges 100 103 106 100 County Engineering 33 39 42 42 Traffic Engineering 22 24 26 24 Real Estate Acquisition 0 0 0 3 Economic Environment 6 6 6 4.5 Human Services 15 17 15 15 Culture/Recreation Libraries 51 51 52.5 50 Parks 39 43 42 41 Recreation Department 56.5 56 58.5 57.5 Coastal Engineering 3 3 3 3 Shooting Range 6 6 6 5.5 Golf Course 22 21.5 21.5 18 Court Related Law Library 1 1 1 1 Total 1,579 1,692.5 Source. Indian River County, Florida annual budgets Method. Using 1 0 for each full-time employee, and 0.50 for each part-time/seasonal employee. Totals include unfilled positions. (A) The fire and advanced life support departments were consolidated on September 18, 2006 196 1,757 5 1,704.5 1 v 0 0 1 0 1 3 1 1 Schedule 19 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 2009 2010 2011 2012 2013 2014 10 10 10 8.5 9 9 7 6 6 6 6 6 3 2 72 2 35 2 35 2.35 2.35 23 21.5 19.85 19.85 19.35 20 85 19 16 14 32 15 15 14.5 44 5 36 5 34 34 75 33.9 33.4 99.5 98.5 98 96 98 93 40 40 36 35 35 36 9 5 9.5 8 8.5 8.5 9.5 38 38 38 38 44 45 240 246 244 243 243 243 195 198 207 163 163 163 29.5 29.5 29.5 27 5 27.5 27.5 301 301 301 303 303 303 18 17 15 14 15 18.5 10 9 6.68 6 4 4 49 49 10 9 9 9 128 118 112.5 112.5 113.5 116.5 9 9 8 8 7 8 86.5 80 77 77.25 77.1 78 1 33 28 27 26 24 24 21 21 20 20 19 19 2 2.28 1 1 1 1 3.5 3.5 25 25 25 25 14.5 13 13 13 12 12 45.5 47.5 46.5 42 41.5 41 5 39 37 34 28 28 28 46 37.5 33 33.3 32 3 32 8 3 2 2 2 2 2 55 5.5 5 5 5 5 16 5 15.5 15 5 15 13.5 13 5 1,589.5 1,549 0 1,478.0 1,416 0 197 1,415 0 1,422 5 Indian River County, Florida Capital Asset Statistics by Function/Program (Unaudited) Last Ten Fiscal Years Function/Program 2005 2006 2007 2008 General Government Buildings and grounds Total square footage maintained 493,270 493,270 715,215 715,215 Number of facilities and sites maintained 43 43 47 47 Vehicles 18 18 17 17 General government Vehicles 32 36 37 28 Planning Vehicles 6 6 7 7 GIS Vehicles 1 Public Safety Fire department Vehicles 43 49 54 53 Fire stations 11 11 11 I 1 Advanced life support Vehicles 25 24 21 20 E911 Center Vehicles 1 Sheriff Vehicles 252 274 276 295 Building department Vehicles 27 29 22 13 Physical Environment Solid waste Vehicles 32 33 34 32 Telecommunications Vehicles 1 Ag Extension Vehicles 2 2 2 2 Utilities - Water and Sewer Vehicles 84 90 86 82 Water treatment plants 2 2 2 2 Wastewater treatment facilities 7 7 6 6 Water main - miles N/A 737 769 780 Force main - miles N/A 188 217 240 Gravity sewer lines - miles N/A 250 259 261 Transportation Road and bridge Miles maintained (paved & unpaved) 614 614 617 625 Bridges maintained 78 78 78 78 Vehicles 61 66 68 65 Source. Internal reports prepared by the various departments of Indian River County 198 Schedule 20 2009 2010 2011 2012 2013 2014 715,215 715,215 715,215 720,215 720,215 720,215 47 47 47 48 48 48 15 15 15 15 15 16 27 26 31 31 30 30 7 7 7 6 5 54 51 51 51 46 11 12 12 12 12 20 17 18 18 19 1 1 1 1 1 291 288 298 295 274 9 9 9 9 9 6 1 47 12 19 I 293 10 30 30 1 1 1 1 2 1 82 81 81 85 79 80 2 2 2 2 2 2 6 6 6 6 6 6 819 845 839 843 847 852 230 226 229 223 225 225 262 269 271 270 273 269 628 636 636 638 650 650 78 78 75 75 71 72 65 64 67 67 64 64 Continued 199 Indian River County, Florida Capital Asset Statistics by Function/Program (Unaudited) Last Ten Fiscal Years Function/Program 2005 2006 2007 2008 Transportation - continued: Senior Resource Association Vehicles 20 22 25 23 Engineering Vehicles 9 11 12 17 Traffic engineering Traffic signals operated 122 125 132 133 Beacons operated 37 42 42 41 Vehicles 6 6 3 5 Traffic operations Vehicles 10 10 16 16 Human Services Health department Vehicles 17 16 16 16 Animal Control Vehicles 5 6 7 7 Rental Assistance Vehicles 3 3 2 2 Culture/Recreation Libraries Locations 2 2 2 2 Parks Number of neighborhood parks 12 12 12 12 Number of County parks 47 47 47 47 Acreage 3,994 4,004 4,014 4,014 Picnic shelters maintained 64 66 69 69 Boat ramps maintained 8 8 8 8 Vehicles 22 23 25 24 Recreation Vehicles 4 5 5 5 Shooting range Vehicles 1 1 1 Rifle range stations 29 29 29 Pistol range stations 35 35 35 35 Golf Course Holes maintained 36 36 36 36 Vehicles 2 2 2 2 200 Schedule 20 2009 2010 2011 2012 2013 2014 25 32 34 34 38 16 16 16 13 13 35 13 133 137 137 137 150 150 48 48 53 46 45 45 3 1 1 1 1 1 15 16 18 18 19 21 16 15 15 17 17 17 7 7 7 7 7 6 2 2 2 2 2 2 9 3 3 3 3 3 12 12 12 12 10 10 47 47 47 47 40 37 4,014 4,014 4,014 4,014 4,014 3,429 69 69 69 69 69 69 8 8 8 8 8 8 25 24 25 24 22 23 5 5 5 5 5 5 1 1 1 1 1 1 29 29 29 29 29 29 35 35 35 35 35 35 36 36 36 36 36 36 2 2 2 2 2 2 201 Indian River County, Florida Department of Utility Services Historical Rate Structure (Unaudited) Last Ten Fiscal Years Schedule 21 Fiscal Years 2005-2014 * WATER RATES Billing charges $ 1.29 Base facilities charges (per ERU) Single-family or commercial 7.76 Multi -family or manufactured home 6.60 Volume charge - per 1,000 gallons (per ERU) 0-3,000 gallons 2.20 3,000-7,000 gallons 2.42 7,001 gallons and over 3.85 Excess volume surcharge - greater than 13,000 gallons per month (per ERU) 7.70 Base facilities charge where capacity is reserved but lines are not yet available (per ERU) Single-family or commercial 3.88 Multi -family or manufactured home 3.30 SEWER RATES Billing charges Base facility charge (per ERU) Single-family or commercial Multi -family or manufactured home Volume charge - per 1,000 gallons Single-family & manufactured home (1,000-12,000) Multi -family & commercial (0-13,000) Multi -family & commercial (>13,000) Base facilities charge where capacity is reserved but lines are not yet available (per ERU) Single-family or commercial Multi -family or manufactured home *The last change to the County's water and sewer rates occurred on October 1, 1999. 1.29 14.58 12.40 2.86 2.86 4.29 7.29 6.20 Source: Indian River County Utilities Department In addition to the charges shown above, users of the North Beach Water System are subject to a $13 per ERU per month surcharge. 202 Indian River County, Florida I Water and Wastewater Customers (Unaudited) Last Ten Fiscal Years Schedule 22 1 The number of County water and wastewater customers, expressed as the number of equivalent residential Iunits (ERUs), for the years 2005 through 2014 as set forth below: 1 Fiscal Year Water ERUs Wastewater ERUs 1 2005 53,032 38,387 2006 54,070 41,351 1 2007 61,494 45,396 1 2008 61,558 45,785 2009 63,147 45,319 1 2010 64,146 45,427 1 2011 64,391 45,863 2012 64,820 46,107 1 2013 65,477 46,576 1 2014 66,261 47,027 1 I Source: Indian River County Utilities Department 1 1 1 1 203 Indian River County, Florida Top 10 High Volume Customers of Utility Services (Unaudited) Fiscal Year 2014 Schedule 23 Below is a table depicting the ten highest volume customers of the utility system for the fiscal year ended September 30, 2014: Customer Annual Water Annual Wastewater Volume Volume (x 1,000 gals.) (x 1,000 gals.) 1. Vista Royale 31,019 31,019 2. IRC School Board 26,897 20,783 3. City of Fellsmere - 23,842 4. Acts, Inc. 23,745 23,629 5. MHC Village Green LLC 21,457 21,457 6. Disney's Vero Beach Resort 20,382 20,382 7. Encore RV Park 14,118 14,118 8. Palms of Vero Beach LTD 13,322 13,322 9. Vista Gardens 13,276 13,276 10. Lindsey Gardens 13,201 13,113 Source: Indian River County Utilities Department 204 Indian River County, Florida Capacity Charges - Utilities Department (Unaudited) Last Ten Fiscal Years Schedule 24 The County also receives capacity charges in connection with the system. Capacity charges are not pledged as a security for the bonds. While the County may pledge the capacity charges in the future, the County presently has no intention to pledge capacity charges as security for the bonds. Capacity charges for the last ten fiscal years ended September 30 are as follows: Fiscal Year Wastewater Water Capacity Capacity Total Charges Charges Charges 2005 $ 11,036,369 $ 19,109,246 $ 30,145,615 2006 4,758,320 8,287,244 13,045,564 (A) 2007 1,159,803 620,915 1,780,718 (A) 2008 699,054 1,088,279 1,787,333 2009 504,658 367,940 872,598 2010 1,025,700 276,551 1,302,251 2011 485,225 462,114 947,339 2012 585,490 755,838 1,341,328 2013 795,134 1,225,379 2,020,513 2014 1,081,355 1,625,404 2,706,759 (A) Large decrease in capacity charges due to construction slowdown. 205 Indian River County, Florida Pledged Revenues for Spring Training Facility Revenue Bonds, Series 2001 (Unaudited) Last Ten Fiscal Years Schedule 25 Year Professional Total Ended Sports State Tourist One Cent Half Cent September 30 Subsidy Tax Collected Tourist Tax (A) Sales Tax (B) 2005 $ 500,004 $ 1,675,781 $ 418,945 $ 8,746,849 2006 500,004 1,517,360 379,340 8,776,684 2007 500,004 1,449,083 362,271 8,122,976 2008 500,004 1,584,512 396,128 7,587,682 2009 500,004 1,294,163 323,541 7,000,465 2010 500,004 1,324,953 331,238 6,929,458 2011 500,004 1,487,061 363,233 7,075,101 2012 500,004 1,604,919 401,230 7,412,887 2013 500,004 1,743,283 435,821 7,828,550 2014 500,004 1,918,200 479,550 8,219,778 (A) A 4th cent was imposed effective February 1, 2001. (B) This amount represents 100% of the half -cent sales tax received. Eighty-six percent of this amount is pledged to the payment of debt service.on the Series 2001 bonds. Refer to pledged revenue coverage on County Note 13. 206 1 1 Rehmann 1 1 1 1 1 1 1 1 1 ' In planning and performing our audit of the financial statements, we considered the County's internal control over financial reporting (internal control) to determine the audit procedures that are appropriate in the circumstances for the purpose of expressing our opinions on the financial statements, but not for the purpose of expressing an opinion on the effectiveness of the County's internal control. Accordingly, we do not express an opinion on the effectiveness of the County's internal control. Rehmann Robson 5070 North Highway A1A Suite 250 Vero Beach, FL 32963 Ph 772.234 8484 Fx 772.234 8488 rehmann.com INDEPENDENT AUDITORS' REPORT ON INTERNAL CONTROL OVER FINANCIAL REPORTING AND ON COMPLIANCE AND OTHER MATTERS BASED ON AN AUDIT OF FINANCIAL STATEMENTS PERFORMED IN ACCORDANCE WITH GOVERNMENT AUDITING STANDARDS March 4, 2015 The Honorable Board of County Commissioners and Constitutional Officers Indian River County, Florida We have audited, in accordance with the auditing standards generally accepted in the United States of America and the standards applicable to financial audits contained in Government Auditing Standards issued by the Comptroller General of the United States, the financial statements of the governmental activities, the business -type activities, each major fund, and the aggregate remaining fund information of Indian River County, Florida (the "County"), as of and for the year ended September 30, 2014, and the related notes to the financial statements, which collectively comprise the County's basic financial statements, and have issued our report thereon dated March 4, 2015. Internal Control over Financial Reporting 1 A deficiency in internal control exists when the design or operation of a control does not allow t management or employees, in the normal course of performing their assigned functions, to prevent, or detect and correct misstatements on a timely basis. A material weakness is a deficiency, or a combination of deficiencies, in internal control such that there is a reasonable possibility that a ' material misstatement of the entity's financial statements will not be prevented, or detected and corrected on a timely basis. A significant deficiency is a deficiency, or a combination of deficiencies, in internal control that is less severe than a material weakness, yet important enough to merit attention by those charged with governance. 1 1 1 Our consideration of internal control was for the limited purpose described in the preceding paragraph and was not designed to identify all deficiencies in internal control that might be material weaknesses or significant deficiencies. Given these limitations, during our audit we did not identify any deficiencies in internal control that we consider to be material weaknesses. However, material weaknesses may exist that have not been identified. Rehmann is an Independent member of Nexia International CPAs & Consultants Wealth Advisors Corporate Investigators 207 INTERNATIONAL The Honorable Board of County Commissioners Indian River County, Florida March 4, 2015 Page 2 Compliance and Other Matters As part of obtaining reasonable assurance about whether the County's financial statements are free of material misstatement, we performed tests of its compliance with certain provisions of laws, regulations, contracts, and grant agreements, noncompliance with which could have a direct and material effect on the determination of financial statement amounts. However, providing an opinion on compliance with those provisions was not an objective of our audit and, accordingly, we do not express such an opinion. The results of our tests disclosed no instances of noncompliance or other matters that are required to be reported under Government Auditing Standards. Purpose of this Report The purpose of this report is solely to describe the scope of our testing of internal control and compliance and the results of that testing, and not to provide an opinion on the effectiveness of the County's internal control or on compliance. This report is an integral part of an audit performed in accordance with Government Auditing Standards in considering the entity's internal control and compliance. Accordingly, this communication is not suitable for any other purpose. _e4a,„,,ced.,,x. LLC 208 1 1 P4fZehmann 1 1 1 1 1 1 A 1 1 1 1 1 1 1 1 1 1 MANAGEMENT LETTER March 4, 2015 The Honorable Board of County Commissioners and Constitutional Officers Indian River County, Florida Report on the Financial Statements Rehmann Robson 5070 North Highway Al Suite 250 Vero Beach, FL 32963 Ph 772.234 8484 Fx 772.234.8488 rehmann.com We have audited the financial statements of governmental activities, the business -type activities, each major fund and the aggregate remaining fund information of the Indian River County, Florida (the "County"), as of and for the year ended September 30, 2014, and have issued our report thereon dated March 4, 2015. Auditor's Responsibility We conducted our audit in accordance with auditing standards generally accepted in the United States of America; the standards applicable to financial audits contained in Government Auditing Standards, issued by the Comptroller General of the United States; OMB Circular A-133, Audits of States, Local Governments, and Non -Profit Organizations; and Chapter 10.550, Rules of the Florida Auditor General. Other Reports and. Schedule We have issued our Independent Auditors' Report on Internal Control over Financial Reporting and on Compliance and Other Matters Based on an Audit of the Financial Statements Performed in Accordance with Government Auditing Standards; Independent Auditor's Report on Compliance with Each Major Program and State Project and Report on Internal Control over Compliance; Schedule of Findings and Questioned Costs; and Independent Accountants' Report on an examination conducted in accordance with AICPA Professional Standards, Section 601, regarding compliance requirements in accordance with Chapter 10.550, Rules of the Auditor General. Disclosures in those reports and schedule, which are dated March 4, 2015, should be considered in conjunction with this management letter. Prior Audit Findings Section 10.554(1)(i)1., Rules of the Auditor General, requires that we determine whether or not corrective actions have been taken to address findings and recommendations made in the preceding annual financial audit report. There were no findings or recommendations in the preceding annual financial audit report. Official Title and Legal Authority Section 10.554(1)(i)4., Rules of the Auditor General, requires that the name or official title and legal authority for the primary government and each component unit of the reporting entity be disclosed in this management letter, unless disclosed in the notes to the financial statements. This information is disclosed in the notes to the financial statements. Rehmann is an independent member of Nexia International. CPAs & Consultants Wealth Advisors Corporate Investigators 209 \ T E R\ATI05 AL Financial Condition Section 10.554(1)(i)5.a., Rules of the Auditor General, requires that we report the results of our determination as to whether or not the County has met one or more of the conditions described in Section 218.503(1), Florida Statutes, and identification of the specific conditions met. In connection with our audit, we determined that the County did not meet any of the conditions described in Section 218.503(1), Florida Statutes. Pursuant to Sections 10.554(1)(i)5.c. and 10.556(8), Rules of the Auditor General, we applied financial condition assessment procedures. It is management's responsibility to monitor the County's financial condition and our financial condition assessment was based in part on representations made by management and the review of financial information provided by same. Annual Financial Report Section 10.554 (1)(i)5.b., Rules of the Auditor General, requires that we report the results of our determination as to whether the annual financial report for the County for the fiscal year ended September 30, 2014, filed with the Florida Department of Financial Services pursuant to Section 218.32(1)(a), Florida Statutes, is in agreement with the annual financial audit report for the fiscal year ended September 30, 2014. In connection with our audit, we determined that these two reports were in agreement. Other Matters Section 10.554(1)(i)2., Rules of the Auditor General, requires that we address in the management letter any recommendations to improve financial management. In connection with our audit, we did not have any such recommendations. Section 10.554(1)(i)3., Rules of the Auditor General, requires that we address noncompliance with provisions of contracts or grant agreements, or abuse, that have occurred, or are likely to have occurred, that have an effect on the financial statements that is less than material but which warrants the attention of those charged with governance. In connection with our audit, we did not have any such findings. Purpose of this Letter Our management letter is intended solely for the information and use of the Legislative Auditing Committee, members of the Florida Senate and the Florida House of Representatives, the Florida Auditor General, Federal and other granting agencies, the Board of County Commissioners and applicable management and is not intended to be and should not be used by anyone other than these specified parties. -4.'4n, LLC 210 1 1Fkehmann Rehmann Robson P 5070 North Highway A1A Suite 250 Vero Beach, FL 32963 Ph 772.234 8484 Fx 772.234 8488 rehmann.com 1 INDEPENDENT ACCOUNTANTS' REPORT March 4, 2015 The Honorable Board of County Commissioners Indian River County, Florida We have examined the compliance of Indian River County, Florida (the "County") with Section 218.415, 28.35 and 28.36 Florida Statutes, during the year ended September 30, 2014. Management is responsible for compliance with those requirements. Our responsibility is to express an opinion on the County's compliance based on our examination. Our examination was conducted in accordance with attestation standards established by the American Institute of Certified Public Accountants and, accordingly, includes examining, on a test basis, ' evidence about the County's compliance with those requirements and performing such other procedures as we considered necessary in the circumstances. We believe that our examination provides a reasonable basis for our opinion. Our examination does not provide a legal determination on the County's compliance with specified requirements. In our opinion, the County complied, in all material respects, with the aforementioned requirements for the year ended September 30, 2014. ' This report is intended solely for the information and use of management, the Board of County Commissioners and the Florida Auditor General and is not intended to be and should not be used by anyone other than these specified parties. 4I4dLLC Rebmann is an independent member of Nexia International. CPAs & Consultants Wealth Advisors Corporate Investigators 211 INTERN 4TIO.5 AL Rehmann Rehmann Robson 5070 North Highway A1A Suite 250 Vero Beach, FL 32963 Ph 772.234 8484 Fx 772.234.8488 rehmann.com INDEPENDENT AUDITORS' REPORT ON THE SCHEDULE OF EXPENDITURES OF FEDERAL AWARDS AND STATE PROJECTS REQUIRED BY OMB CIRCULAR A-133 AND CHAPTER 10.550, RULES OF THE AUDITOR GENERAL March 4, 2015 The Honorable Board of County Commissioners and Constitutional Officers Indian River County, Florida We have audited the financial statements of the governmental activities, the business -type activities, each major fund, and the aggregate remaining fund information of Indian River County, Florida (the "County") as of and for the year ended September 30, 2014, and the related notes to the financial statements, which collectively comprise the County's basic financial statements. We issued our report thereon dated March 4 2015, which contained unmodified opinions on those financial statements. Our audit was conducted for the purpose of forming opinions on the financial statements that collectively comprise the basic financial statements. The accompanying schedule of expenditures of federal awards and state projects is presented for purposes of additional analysis as required by OMB Circular A-133, Audits of States, Local Governments, and Non-profit Organizations, and Chapter 10.550, Rules of the Auditor General, and is not a required part of the basic financial statements. Such information is the responsibility of management and was derived from and relates directly to the underlying accounting and other records used to prepare the basic financial statements. The information has been subjected to the auditing procedures applied in the audit of the 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, the schedule of expenditure of federal awards and state projects is fairly stated in all material respects in relation to the basic financial statements as a whole. Rehmann is an independent member of Nexia International. CPAs & Consultants Wealth Advisors Corporate Investigators 444(,,ced4-ryt- LLC 212 I NT E55 ATION5L Indian River County, Florida Schedule of Expenditures of Federal Awards and State Projects For the Fiscal Year Ended September 30, 2014 Federal/State Agency Pass-through Entity Federal Program/State Project Department of Housing and Urban Development: Direct Programs: Section 8 Housing Choice Vouchers CFDA/ Contract/ CSFA Grant No. No. Expenditures 14 871 FL -132-V0-014 to 017 $ 1,987,103 Shelter Plus Care 14.238 FL0380C4H091000 58,327 Shelter Plus Care 14.238 FLOI 13CH090800 91,101 Shelter Plus Care 14.238 FL0338CH090900 46,648 Subtotal CFDA - 14.238 196,076 Supportive Housing Program - Homeless Management Information Systems Homeless Management Information Systems Subtotal CFDA 14.235 14.235 14.235 FL0308B4H091204 FL0418B4H091100 25,856 27,917 53,773 Continuum of Care - Rental Assistance 14.267 FL0360L4H091203 69,767 Rental Assistance 14.267 FL0360C4H091304 21,102 Rental Assistance 14.267 FL0440L4H091201 64,423 Rental Assistance 14.267 FL0440L4H091302 41,919 Rental Assistance 14.267 FLOI 14L4H091205 41,475 Rental Assistance 14.267 FL0114L4H091306 27,203 Supportive Services 14.267 FLO115L4H091205 46,709 Homeless Management Information Systems 14.267 FLOI 16L4H091205 34,725 Rental Assistance 14.267 FLOI 19L4H091205 92,771 Rental Assistance 14.267 FLOI 19L4H091306 17,085 Rental Assistance 14.267 FL0120L4H091205 121,602 Rental Assistance 14.267 FL0120L4H091306 37,549 Subtotal CFDA - 14267 616,330 Comm. Dev Block Grant - Neiehborhood Stabilization Pgm 3 CDBG NSP 43 Program Income Expenditures Indirect Programs: Passed through Florida Dept. of Economic Opportunity' Comm. Dev Block Grant - Neighborhood Revitalization Comm. Dev Block Grant - Neighborhood Stabilization Program CDBG NSP Program Income Expenditures Subtotal CFDA - 14.228 Indirect Program. Passed through Florida Housing Finance Corporation. Tenant Based Rental Assistance 14.228 14.228 14.228 14.228 14.228 B -11 -UN -12-0022 Program Income 12DB-OH-10-40-01-NO 1 10DB-4X-10-40-01-F 13 Program Income 535,223 60,028 27,000 96,104 11,027 729,382 14.239 2013-2IOTBRA 224,831 Total Department of Housing and Urban Development 3,807,495 Federal Transit Administration: Direct Programs: Federal Transit Formula Section 5307 Grant Federal Transit Formula Section 5307 Grant Federal Transit Formula Section 5307 Grant Federal Transit Formula Section 5307 Grant Federal Transit Formula Section 5307 Grant Total Federal Transit Administration 20 507 20.507 20.507 20.507 20.507 213 FL -90-X838 FL -90-X828 FL -90-X799 FL -90-X756 FL -90-X739 $ Transfers to Subrecipients 1.571 021 352,448 2,403 26,000 87 717 2,039.589 Indian River County, Florida Schedule of Expenditures of Federal Awards and State Projects For the Fiscal Year Ended September 30, 2014 Federal/State Agency CFDA/ Contract/ Pass-through Entity CSFA Grant Federal Program/State Project No. No. Department of Transportation: Indirect Programs: Passed through Florida Department of Transportation. Old Dixie Highway Sidewalk Florida Safe Routes to School Metropolitan Planning Organization Subtotal CFDA - 20.205 Expenditures 20.205 AQN64 $ 153,151 20.205 BDV23I 13,651 20.205 AA080 353,822 520,624 Transfers to Subrecipients Federal Transit Metropolitan Planning Grant 20.505 AQ212 36,359 Section 5311 Non -Urbanized Public Transit 20.509 APT03 $ 66,195 Safe Routes to School 20 600 AQJ07 24,950 Passed through Florida Department of Environmental Protection. Indian River Lagoon Greenway 20.219 TTI 1037 109,000 Total Department of Transportation 690,933 66,195 Department of Justice: Direct Programs: State Criminal Alien Assistance Program 16 606 2013 -AP -BX -0044 55,721 2013 Local Solicitation Justice Assistance Grant 16 738 2013 -DJ -BX -0298 21,927 Indirect Programs: Passed through Florida Department of Law Enforcement: Bryne Formula Grant Program Multi -Agency Drug Enforcement Unit Drug Testing Program Grant Subtotal CFDA - 16 738 16 738 16 738 2014-JAGC-INRI-2-E5-233 2014-JAGC-1 NRI -1-E5-230 61,852 10,575 94,354 Passed through Office of the Attorney General. Crime Victim Assistance Program 16.575 V13050 38,391 Total Department of Justice 188,466 Department of Health and Human Services, Agency for Children and Families, Office of Child Support Enforcement: Indirect Programs: Passed through Florida Department of Revenue' Sheriff Service of Notices Child Support Enforcement -Title IV D Total Office of Child Support Enforcement 93.563 00331 7,198 93.563 CD331 404,854 214 412,052 Indian River County, Florida Schedule of Expenditures of Federal Awards and State Projects For the Fiscal Year Ended September 30, 2014 Federal/State Agency Pass-through Entity Federal Program/State Project Department of Homeland Security: Indirect Programs: Passed through Division of Emergency Management: Emergency Management Homeland Security Emergency Management Homeland Security Emergency Management Homeland Security Subtotal CFDA - 97 067 Community Emergency Response Team Emergency Management Performance Grant Subtotal CFDA - 97 042 FEMA Hazardous Mitigation Grant CFDA/ Contract/ CSFA Grant No. No. 97.067 97.067 97.067 12 -DS -20-10-40-01-454 $ 13 -DS -97-08-39-01-370 14 -DS -L5-10-40-01-281 97 042 14 -C1 -K1-10-40-02-415 97 042 14 -FG -1M-10-40-01-098 Expenditures 5,700 15,778 7,022 28,500 11,174 74,374 85,548 97 039 07HM-4a-10-04-01-008 51,222 Total Department of Homeland Security 165,270 US Fish and Wildlife Service: Indirect Program. Passed Through Fla Fish and Wildlife Conservation Commission Indian River County Artificial Reef Construction Total US Fish and Wildlife Service Environmental Protection Agency: Indirect Program. Passed through Florida Dept of Environmental Protection. PC South Algal Nutrient Removal Facility Total Environmental Protection Agency 15 605 FWC-13127 41,000 41,000 66.460 G0353 850,000 850,000 Transfers to Subrecipients TOTAL EXPENDITURES OF FEDERAL AWARDS: $ 6,155,216 $ 2,105,784 215 Indian River County, Florida Schedule of Expenditures of Federal Awards and State Projects For the Fiscal Year Ended September 30, 2014 Federal/State Agency CFDA/ Contract/ Pass-through Entity CSFA Grant Transfers to Federal Program/State Project No. No. Expenditures Subrecipients STATE OF FLORIDA Division of Emergency Management: Direct Projects: Hazardous Materials Analysis Grant Emergency Management Programs Emergency Management Preparedness and Assistance Emergency Management Preparedness and Assistance Subtotal CSFA - 31 063 31 067 14 -CP -11-10-40-01-274 $ 5,149 31063 31 063 15 -BG -83-10-40-01-031 14 -BG -83-10-40-01-031 18,600 81,548 100,148 Total Division of Emergency Management 105,297 Department of Economic Opportunity: Direct Project: Community Planning Technical Assistance Total Department of Economic Opportunity Florida Housing Finance Corporation: Direct Projects. State Housing Initiatives Partnership Total Florida Housing Finance Corporation Department of State: Direct Project: Archie Smith Fish House Restoration State Aid to Libraries Total Department of State 40 024 P0039 25,000 25,000 52.901 N/A 595,185 595,185 45 031 S1429 49,500 45 030 14 -ST -23 92,962 Department of Transportation: Direct Projects: Transportation Disadvantaged Planning Grant 55 002 AR258 Transportation Disadvantaged Planning Grant 55 002 ARH80 Subtotal CSFA - 55 002 SCOP - CR512 Eastbound Lanes 55 009 AQ072 SCOP - CEI Services of IR Blvd 55 009 AR548 Subtotal CSFA - 55 009 FI Public Transit Block Grant 55 010 APT70 FDOT Service Development Grant 55 012 AQGO7 Transit Corridor Grant 55 013 ARE86 Transit Corridor Grant 55 013 AP049 Subtotal CSFA - 55 013 TRIP - 66th Avenue from SR60 to 41st Street 55 026 AQN66 Total Department of Transportation 216 142,462 17,668 4,139 21,807 113,926 431,711 545,637 2,859,577 $ 339,000 332,000 13,820 84,719 98,539 3,427,021 769,539 Indian River County, Florida Schedule of Expenditures of Federal Awards and State Projects For the Fiscal Year Ended September 30, 2014 FederaUState Agency CFDA/ Contract/ Pass-through Entity CSFA Grant Transfers to Federal Program/State Project No. No. Expenditures Subrecipients STATE OF FLORIDA - Continued Department of Environmental Protection: Direct Projects: Wabasso Beach Restoration Project 37 003 14IR3 $ 223,386 Hurricane Sandy Beach Project 37 003 14IR2 22,031 Subtotal CSFA - 37 003 245,417 PC South Algal Nutrient Removal Facility Pollution Control South 37 039 G0353 37 039 LP31010 1,376,900 156,000 Subtotal CSFA : 37 039 1,532,900 Total Department of Environmental Protection 1,778,317 Department of Health: Direct Project: County Awards Grant -Emergency Medical Svc Total Department of Health Fla Fish and Wildlife Conservation Commission: Direct Project: Indian River County Artificial Reef Construction Total Fla Fish and Wildlife Conservation Commission Department of Revenue: Direct Project: Facilities for Retained Spring Training Franchise Total Department of Revenue 64 005 C2031 21,726 21,726 77 007 FWC-13127 12.018 12,018 73 016 N/A 500,004 500,004 TOTAL EXPENDITURES OF STATE FINANCIAL ASSISTANCE: $ 6,607,030 $ 769,539 217 Indian River County, Florida Notes to Schedule of Expenditures of Federal Awards and State Projects For the Fiscal Year Ended September 30, 2014 NOTE 1— SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES The accounting policies and presentation of the Single Audit Report of Indian River County, Florida, (the "County") have been designed to conform to generally accepted accounting principles as applicable to governmental units, including the reporting and compliance requirements of the Audits of States, Local Governments, and Non -Profit Organizations and Office of Management and Budget Circular A- 133 A. Reporting Entity The reporting entity consists of Indian River County, the primary government, and each of its component units. The County includes a Schedule of Expenditures of Federal Awards and State Projects in the Compliance Section. B. Basis of Accounting Basis of accounting refers to when revenues and expenditures or expenses are recognized in the accounts and reported in the financial statements. Basis of accounting relates to the timing of the measurements made, regardless of the measurement focus. The Schedule of Expenditures of Federal Awards and State Projects is maintained on a modified accrual basis of accounting for governmental funds and a full accrual basis for proprietary funds, which is explained further in the notes to the financial statements. Such expenditures are recognized following the cost principles contained in OMB A-87 Cost Principles for State, Local, and Indian Tribal Governments, wherein certain types of expenditures are not allowable or are limited as to reimbursement. C. Program Clusters OMB Circular A-133 defines a cluster of programs as a grouping of closely related programs that share common compliance requirements. According to this definition, similar programs deemed to be a cluster of programs are tested accordingly. D. Contingencies Grant revenue amounts received by the County are subject to audit and adjustment by the grantor agencies. Such audits may result in requests for reimbursement by the grantor agency. Any adjustments to grant funding are recorded in the year the adjustment occurs. 218 1 ' 4 h m a Rehmann Robson Fe 5070 North Highway A1A Suite 250 1 Vero Beach, FL 32963 Ph 772.234 8484 Fx 772.234 8488 rehmann.com 1 INDEPENDENT AUDITORS' REPORT ON COMPLIANCE WITH REQUIREMENTS THAT COULD HAVE A DIRECT AND MATERIAL EFFECT ON EACH MAJOR FEDERAL PROGRAM AND MAJOR STATE PROJECT AND ON INTERNAL CONTROL OVER COMPLIANCE IN ACCORDANCE WITH OMB CIRCULAR A-133 AND CHAPTER 10.550, RULES OF THE AUDITOR GENERAL ' March 4, 2015 The Honorable Board of County Commissioners and Constitutional Officers Indian River County, Florida tReport on Compliance for Each Major Federal Program and Major State Project We have audited the compliance of Indian River County, Florida (the "County") with the types of compliance requirements described in the OMB Circular A-133 Compliance Supplement and the requirements described in the Florida Department of Financial Services' State Projects Compliance Supplement that could have a direct and material effect on each of the County's major federal programs or state projects for the year ended September 30, 2014. The County's major federal programs and state projects are identified in the summary of auditors' results section of the accompanying schedule of findings and questioned costs. ' Management's Responsibility Management is responsible for compliance with the requirements of laws, regulations, contracts, and L grants applicable to its federal programs. Independent Auditors' Responsibility Our responsibility is to express an opinion on compliance for each of the County's major federal programs based on our audit of the types of compliance requirements referred to above. We conducted our audit of compliance in accordance with auditing standards generally accepted in the United States of America; the standards applicable to financial audits contained in Government Auditing Standards issued by the Comptroller General of the United States; OMB Circular A-133, Audits of States, Local Governments, and Non -Profit Organizations; and Chapter 10.550, Rules of the Auditor General. Those standards and OMB Circular A-133 require that we plan and perform the audit to obtain reasonable assurance about whether noncompliance with the types of compliance requirements referred to above that could have a direct and material effect on a major federal program or state project occurred. An audit includes examining, on a test basis, evidence about the County's compliance with those requirements and performing such other procedures as we considered necessary in the circumstances. We believe that our audit provides a reasonable basis for our opinion on compliance for each major federal program. However, our audit does not provide a legal determination of the County's compliance. 1 Rehmann is an independent member of Nexia International CPAs & Consultants Wealth Advisors Corporate Investigators 219 INTERN 4TIn\AI The Honorable Board of County Commissioners Indian River County, Florida March 4, 2015 Page 2 Opinion on Each Major Federal Program and State Project In our opinion, the County complied, in all material respects, with the types of compliance requirements referred to above that could have a direct and material effect on each of its major federal programs and state projects for the year ended September 30, 2014. Report on Internal Control Over Compliance Management of the County is responsible for establishing and maintaining effective internal control over compliance with the types of compliance requirements referred to above. In planning and performing our audit of compliance, we considered the County's internal control over compliance with the types of requirements that could have a direct and material effect on each major federal program and state project to determine the auditing procedures that are appropriate in the circumstances for the purpose of expressing an opinion on compliance for each major federal program and state project and to test and report on internal control over compliance in accordance with OMB Circular A-133 and Chapter 10.550, Rules of the Auditor General, but not for the purpose of expressing an opinion on the effectiveness of internal control over compliance. Accordingly, we do not express an opinion on the effectiveness of the County's internal control over compliance. A deficiency in internal control over compliance exists when the design or operation of a control over compliance does not allow management or employees, in the normal course of performing their assigned functions, to prevent, or detect and correct, noncompliance with a type of compliance requirement of a federal program on a timely basis. A material weakness in internal control over compliance is a deficiency, or combination of deficiencies, in internal control over compliance, such that there is a reasonable possibility that material noncompliance with a type of compliance requirement of a federal program or state project will not be prevented, or detected and corrected, on a timely basis. A significant deficiency in internal control over compliance is a deficiency, or a combination of deficiencies, in internal control over compliance with a type of compliance requirement of a federal program or state project that is less severe that a material weakness in internal control over compliance, yet important enough to merit attention by those charged with governance. Our consideration of internal control over compliance was for the limited purpose described in the first paragraph of this section and was not designed to identify all deficiencies in internal control over compliance that might be material weaknesses or significant deficiencies. We did not identify any deficiencies in internal control over compliance that we consider to be material weaknesses. However, material weaknesses may exist that have not been identified. Purpose of this Report The purpose of this report on internal control over compliance is solely to describe the scope of our testing of internal control over compliance and the results of that testing based on the requirements of OMB Circular A-133 and Chapter 10.550, Rules of the Auditor General. Accordingly, this report is not suitable for any other purpose. L LC 220 COUNTY OF INDIAN RIVER, FLORIDA ® Schedule of Findings and Questioned Costs For the Year Ended September 30, 2014 SECTION I - SUMMARY OF AUDITORS' RESULTS Financial Statements Type of auditors' report issued: Unmodified Internal control over financial reporting: Material weakness(es) identified? yes X no Significant deficiency(ies) identified? yes X none reported Noncompliance material to financial statements yes X no noted? Federal Awards and State Projects Internal control over major programs and projects: Material weakness(es) identified? yes X no Significant deficiency(ies) identified? yes X none reported Type of auditors' report issued on compliance for major programs: Unmodified Any audit findings disclosed that are required to be reported in accordance with Circular A-133, Section 510(a)? yes X no Identification of major programs: CFDA Number 14.871 66.460 CSFA Number 37.039 55.026 Name of Federal Program or Cluster Section 8 Housing Choice Vouchers Nonpoint Source Implementation Program Name of State Project Statewide Surface Water Restoration Program Transportation Regional Incentives Program Dollar threshold used to distinguish between Type A and Type B programs: $ Auditee qualified as low-risk auditee? 221 300,000 (Federal and State) X yes no COUNTY OF INDIAN RIVER, FLORIDA MI Schedule of Findings and Questioned Costs For the Year Ended September 30, 2014 SECTION II - FINANCIAL STATEMENT FINDINGS None noted. SECTION III - FEDERAL AWARD FINDINGS AND QUESTIONED COSTS None noted. 222 COUNTY OF INDIAN RIVER, FLORIDA 1 Summary Schedule of Prior Audit Findings For the Year Ended September 30, 2014 None noted. 223 JEFFREY R. SMITH, CPA, CGFO, CDMA Clerk of Circuit Court and Comptroller Finance Department 1801 27th Street, Building A Vero Beach, Florida 32960 , Telephone (772) 226-1945 AFFIDAVIT BEFORE ME, the undersigned authority, personally appeared Jeffrey R. Smith, who being duly sworn, deposes and says on oath that: 1. I am the Chief Financial Officer of Indian River County which is a local governmental entity of the State of Florida; 2. Indian River County adopted Ordinance No. 2005-015 on May 17, 2005 implementing an impact fee. The impact fee was subsequently amended as follows: on March 24, 2009 in Ordinance No. 2009- 003, on September 22, 2009 in Ordinance No. 2009-015, and on March 16, 2010 in Ordinance No. 2010-002. The result of these amendments was suspension of five of the eight original impact fees from April 1, 2009 through March 31, 2011. On March 15, 2011 in Ordinance No. 2011-002, the impact fee was amended to suspend three of the eight original impact fees from April 1, 2011 through March 31, 2012. On March 13, 2012, Ordinance No. 2012-003 continued this suspension from April 1, 2012 through March 31, 2014. On October 14, 2014, Ordinance No. 2014-016 continued this suspension pending further trend evaluation during the next scheduled impact fee methodological update. 3. Indian River County has complied and, as of the date of this Affidavit, remains in compliance with Section 163.31801, Florida Statutes. FURTHER AFFIANT SAYETH NAUGHT. STATE OF FLORIDA COUNTY OF INDIAN RIVER (Chief FinancialjOfi'icer of the Entity) SWORN TO AND SUBSCRIBED before me this �� eco day of , 2015. NOTARY PUBLIC Print Name Lt rNit=ie, Rorn t Personally known ✓ or produced identification Type of identification produced: My Commission Expires: 224 Notary Public . State of Florida My Comm. Expires Mar 16, 2015 ` Commission # EE 74710 ,; 225 Pd Rehm. nn INDEPENDENT AUDITORS' REPORT March 4, 2015 The Honorable Board of County of Commissioners Indian River County, Florida Report on the Financial Statements Rehmann Robson 5070 North Highway A1A Suite 250 Vero Beach, FL 32963 Ph 772.234 8484 Fx 772 234 8488 rehmann.com We have audited the accompanying fund financial statements of each major fund, and the aggregate remaining fund information of the Indian River County, Florida Board of County of Commissioners (the "Board"), as of and for the year ended September 30, 2014, and the related notes to the financial statements, which collectively comprise the Board'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. Independent Auditors' 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 of 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 auditors' 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. Rehmann is an independent member of Nexia International. CPAs & Consultants Wealth Advisors Corporate Investigators 226 INTERNATION..L The Honorable Board of County of Commissioners Indian River County, Florida March 4, 2015 Page 2 Opinions In our opinion, the financial statements referred to above present fairly, in all material respects, the respective financial position of the funds of the Board of County Commissioners as of September 30, 2014, and the respective changes in financial position and the respective budgetary comparison for the general fund for the year then ended in accordance with accounting principles generally accepted in the United States of America. Reporting Entity As discussed in Note 1, the financial statements referred to above present only the Indian River County, Florida Board of County Commissioners and do not purport to, and do not, present fairly the financial position of Indian River County, Florida as of September 30, 2014, and the changes in its financial position for the year then ended, in conformity with accounting principles generally accepted in the United States of America. Other Reporting Required by Government Auditing Standards In accordance with Government Auditing Standards, we have also issued our report dated March 4, 2015, on our consideration of Board of County of Commissioners 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 Board of County of Commissioners internal control over financial reporting and compliance. "e\-eisa.co,tt..��a.M. LLC 227 Indian River County, Florida Board of County Commissioners Balance Sheet Governmental Funds September 30, 2014 ASSETS Cash and cash equivalents Accounts receivable Special assessments receivable Due from other funds Due from other governments Interest receivable Inventories Prepaid items Advances to other funds Total assets LIABILITIES Accounts payable Retainage payable Due to other funds Due to other governments Unearned revenues Other deposits Total liabilities DEFERRED INFLOWS OF RESOURCES Unavailable revenue - special assessments Unavailable revenue - ambulance services Unavailable revenue - state and federal grants Total deferred inflows ofresources FUND BALANCES Nonspendable: Inventories Prepaid items Advances to other funds Restricted for: Transportation/road improvements Court -related costs and improvements Housing assistance Law enforcement/public safety Fire/emergency services Tourism -related activities Beach renourishment Boating related projects Library services Land acquisition Stormwater, street lighting, and other special assessments Debt service Capital projects Dodgertown repairs/improvements Solid waste projects Parks/recreational projects Committed to: Economic incentives Environmental conservation/preservation Law enforcement/public safety Parks/recreational projects Assigned to: Transportation/road improvements Unassigned Total fund balances Total liabilities, deferred inflows aid fund balances General Impact Fees $ 46,896,528 $ 483,098 1,146,551 4,006,385 16,046 53,285 85,457 877,237 Secondary Roads Construction 16,667,610 $ 821,626 4,400 $ 53,564,587 $ 13,876,764 352,425 3,577 17,493,636 $ $ 1,384,374 $ 6,772 223,047 24,019 1,638,212 247,510 247,510 53,285 85,457 877,237 1,000,000 1,195,907 3,501 23,775 48,439,703 51,678,865 14,232,766 1,327,925 $ 275,248 1,603,173 769,770 769,770 8,708,193 593,856 925,074 880,856 764,673 24,990 3,223,051 15,120,693 $ 53,564,587 $ 543,293 58,951 602,244 13,630,522 13,630,522 17,493,636 $ The accompanying notes are an integral part of the financial statements. 228 14,232,766 Emergency Optional Other Total Services Sales Governmental Governmental Transportation District Tax Funds Funds $ 8,252,215 $ 9,968,611 $ 50,764,237 $ 18.253,173 $ 164,679,138 3,440 1,022,872 - 46 1,509,456 236,705 236,705 - - 1,146,551 265,728 240,669 4,836,714 881,824 11.405.371 147,363 2,812 13,714 4,632 192,544 - 53,285 7,733 93,190 877,237 $ 8,905,451 $ 11,234,964 $ 55,614,665 $ 19,147,408 $ 180,193,477 483,924 $ 650,268 $ 452,272 $ 628,672 $ 5,470,728 1,740 838,915 102,376 1,277,230 - - 274,500 274,500 - 10,169 16,941 1,636 14,633 - 239,316 - - 40,294 64,313 487,300 664,901 1,291,187 1,056,011 7,343,028 382,066 382,066 - 1,022,807 - 1,022,807 317,741 384,915 1,719,936 382,066 1,022,807 317,741 384,915 3,124,809 53,285 7,733 93,190 877,237 22,338,715 1,079,692 1,079;692 1,055,191 1,055,191 2,140,686 2,734,542 9,547,256 - 10,472,330 333,232 333,232 6,036,795 6,036,795 1,211,506 1,211,506 44,716 925,572 160,855 160,855 1,851,890 1,851,890 2,556,272 2,556,272 54,005,737 54,770,410 296,766 296,766 24,990 4,223,051 1,195,907 1 132,735 1,132,735 3,501 23,775 8.036_.085 8,036,085 - - (201,587) 48,238,116 8.036.085 9547.256 54.005.737 17,706,482 169,725,640 $ 8,905,451 $ 11,234,964 $ 55.614.665 $ 19.147.408 $ 180.193.477 229 Indian River County, Florida Board of County Commissioners Statement of Revenues, Expenditures, and Changes in Fund Balances Governmental Funds For the Year Ended September 30, 2014 General Secondary Impact Roads Fees Construction REVENUES Taxes $ 49,346,756 $ - $ 3,294,709 Permits, fees and special assessments 9,528,916 4,218,105 100,964 Intergovernmental 16,219,734 13,422 1,122,393 Charges for services 4,525,888 - Judgments, fines and forfeits 459,812 - Interest 185,417 7,320 31,566 Miscellaneous 2,162,055 190,519 111,612 Total revenues 82,428,578 4,429,366 4,661,244 EXPENDITURES Current: General government 9,330,789 689,176 - Public safety 4,015,616 534,699 - Physical environment 261,593 - - Transportation 4,031,930 4,268,358 4,399,329 Economic environment 404,504 - - Human services 3,494,670 - - Culture/recreation 8,172,881 681,144 - Court related 204,964 - - Debt service Principal Interest and fiscal charges Capital projects Total expenditures 29,916,947 6,173,377 4,399,329 Excess of revenues over (under) expenditures 52,511,631 (1,744,011) 261,915 OTHER FINANCING SOURCES (USES) Transfers in 8,512 258,613 Transfers out (7,835,591) - Transfers to constitutional officers (42,886,275) (151,416) - Total other financing sources (uses) (50,713,354) (151,416) 258,613 Net change in fund balances 1,798,277 (1,895,427) 520,528 Fund balances at beginning of year 49,880,588 17,016,120 13,109,994 Fund balances at end of year $ 51,678,865 $ 15,120,693 $ 13,630,522 The accompanying notes are an integral part of the financial statements. 230 Transportation Emergency Optional Other Total Services Sales Governmental Governmental District Tax Funds Funds $ - $ 20,064,393 $ 15,228,304 $ 6,651;183 $ 94,585,345 131,486 50,482 291,436 14,321,389 2,796,760 82,765 3,689,417 6,284,077 30,208,568 102,237 5,480,257 - 776,266 10,884,648 - 11,000 - 138,747 609,559 32,346 37,085 109,649 44,987 448,370 410,768 20,547 63,080 123,200 3,081,781 3,473,597 25,696,047 19,140,932 14,309,896 154,139,660 287,856 408,339 10.375,143 25,103,305 11,071,338 25,103,305 (7,597,741) 592,742 482,574 10, 790,395 465.246 30,118,866 111.374 781.306 246.488 23.321.248 702.382 1,106,886 3,683,872 7,178.542 2,773,261 11,627,286 518.610 723.574 3.700.000 3.700.000 1.984,616 1.984.616 16,560,991 - 16.560,991 16,560,991 14,668,423 107,893,710 2,579,941 (358,527) 46,245.950 7,657,704 325,432 8,250,261 (383.613) (183,393) - (8,402,597) - (428,081) (834,674) (425,860) (44,726,306) 7.274,091 (428,081) (1,018,067) (100,428) (44,878,642) (323;650) 164,661 1,561,874 (458,955) 1,367,308 8.359,735 9.382,595 52,443,863 18,165,437 168,358.332 $ 8.036,085 $ 9.547.256 $ 54,005.737 $ 17.706,482 $ 169,725.640 231 Indian River County, Florida Board of County Commissioners Statement of Revenues, Expenditures, and Changes in Fund Balances - Budget and Actual General Fund For the Year Ended September 30, 2014 REVENUES Taxes Permits, fees and special assessments Intergovernmental Charges for services Judgments, fines and forfeits Interest Miscellaneous Total revenues EXPENDITURES Current: General government Public safety Physical environment Transportation Economic environment Human services Culture/recreation Court related Total expenditures Excess of revenues over (under) expenditures OTHER FINANCING SOURCES (USES) Transfers in Transfers out Transfers to constitutional officers Total other financing sources (uses) Net change in fund balances Fund balances at beginning of year Fund balances at end of year Budgeted Amounts Original Final Actual Amounts Variance with Final Budget Positive (Negative) $ 48,473,970 $ 48,473,970 $ 49,346,756 8,468,300 8,468,300 9,528,916 10,936,336 14,207,449 16,219,734 4,848,228 4,868,728 4,525,888 317,300 317,300 459,812 237,500 237,500 185,417 946,059 1,041,211 2,162,055 74,227,693 77,614,458 82,428,578 $ 872,786 1,060,616 2,012,285 (342,840) 142,512 (52,083) 1,120,844 4,814,120 9,040,811 4,304,991 242,182 932,311 372,021 3,830,419 7,981,284 211,913 9,919,184 4,514,333 278,441 4,201,571 414,756 3,930,475 8,803,952 215,805 9,330,789 4,015,616 261,593 4,031,930 404,504 3,494,670 8,172,881 204,964 588,395 498,717 16,848 169,641 10,252 435,805 631,071 10,841 26,915,932 32,278,517 29,916,947 2,361,570 47,311,761 (7,806,955) (42,864,764) 45,335,941 8,512 (7,840,955) (42,943,638) 52,511,631 8,512 (7,835,591) (42,886,275) 7,175,690 5,364 57,363 (50,671,719) (50,776,081) (50,713,354) 62,727 (3,359,958) (5,440,140) 1,798,277 $ 7,238,417 3,359,958 5,440,140 49,880,588 $ $ - $ 51,678,865 The accompanying notes are an integral part of the financial statements. 232 Indian River County, Florida Board of County Commissioners Statement of Revenues, Expenditures, and Changes in Fund Balances - Budget and Actual Impact Fees Fund For the Year Ended September 30, 2014 REVENUES Permits, fees and special assessments Intergovernmental Interest Miscellaneous Total revenues EXPENDITURES Current: General government Public safety Physical environment Transportation Culture/recreation Total expenditures Excess of revenues under expenditures OTHER FINANCING SOURCES (USES) Transfers to constitutional officers Total other financing sources (uses) Net change in fund balances Fund balances at beginning of year Fund balances at end of year Budgeted Amounts Original Final Actual Amounts $ 2,162,200 $ 117,750 325 Variance with Final Budget Positive (Negative) 2,162,200 $ 4,218,105 $ 2,055,905 284,338 13,422 (270,916) 117,750 7,320 (110,430) 325 190,519 190,194 2,280,275 2,564,613 4,429,366 1,864,753 712,620 190,000 26,000 1,721,220 656,455 860,463 1,754,979 26,000 11,193,103 3,824,396 689,176 534,699 4,268,358 681,144 171,287 1,220,280 26,000 6,924,745 3,143,252 3,306,295 17,658,941 6,173,377 11,485,564 (1,026,020) (15;094,328) (151,417) (151,417) (1,744,011) 13,350,317 (151,416) (151,416) 1 1 (1,026,020) 1,026,020 (15,245,745) 15,245,745 (1,895,427) $ 13,350,318 17,016,120 $ $ 15,120,693 The accompanying notes are an integral part of the financial statements. 233 Indian River County, Florida Board of County Commissioners Statement of Revenues, Expenditures, and Changes in Fund Balances - Budget and Actual Secondary Roads Construction Fund For the Year Ended September 30, 2014 REVENUES Taxes Permits, fees and special assessments Intergovernmental Interest Miscellaneous Total revenues EXPENDITURES Current: Transportation Total expenditures Excess of revenues over (under) expenditures Budgeted Amounts Original Final Actual Amounts Variance with Final Budget Positive (Negative) $ 3,151,048 $ 3,151,048 $ 3,294,709 - 100,964 2,263,975 1,122,393 38,000 38,000 31,566 976 53,854 111,612 $ 143,661 100,964 (1,141,582) (6,434) 57,758 3,190,024 5,506,877 4,661,244 (845,633) 7,994,150 14,464,023 4,399,329 10,064,694 7,994,150 14,464,023 4,399,329 10,064,694 (4,804,126) (8,957,146) 261,915 OTHER FINANCING SOURCES (USES) Transfers in - 275,000 258,613 Total other financing sources (uses) - 275,000 258,613 Net change in fund balances Fund balances at beginning of year Fund balances at end of year 9,219,061 (16,387) (16,387) (4,804,126) (8,682,146) 520,528 4,804,126 8,682,146 13,109,994 $ $ - $ 13,630,522 The accompanying notes are an integral part of the financial statements. 234 $ 9,202,674 Indian River County, Florida Board of County Commissioners Statement of Revenues, Expenditures, and Changes in Fund Balances - Budget and Actual Transportation Fund For the Year Ended September 30, 2014 REVENUES Permits, fees and special assessments Intergovernmental Charges for services Interest Miscellaneous Total revenues EXPENDITURES Current: General government Physical environment Transportation Total expenditures Excess of revenues under expenditures OTHER FINANCING SOURCES (USES) Transfers in Transfers out Total other financing sources (uses) Net change in fund balances Fund balances at beginning of year Fund balances at end of year Budgeted Amounts Original Final Actual Amounts $ 123,500 $ 2,464,828 96,425 47,500 875,956 123,500 $ 2,464, 828 96,425 47,500 879,037 131,486 $ 2,796,760 102,237 32,346 410,768 3,608,209 3,611,290 Variance with Final Budget Positive (Negative) 7,986 331,932 5,812 (15,154) (468,269) 3,473,597 (137,693) 271,491 346,565 577,851 596,633 11,539,797 12,825,514 287,856 58,709 408,339 188,294 10,375,143 2,450,371 12,389,139 13,768,712 11,071,338 2,697,374 (8,780,930) (10,157,422) (7,597,741) 2,559,681 7,657,704 7,657,704 (400,000) 7,657,704 (383,613) 16,387 7,657,704 7,257,704 7,274,091 16,387 (1,123,226) (2,899,718) (323,650) $ 2,576,068 1,123,226 2,899,718 8,359,735 $ - $ 8,036,085 The accompanying notes are an integral part of the financial statements. 235 Indian River County, Florida Board of County Commissioners Statement of Revenues, Expenditures, and Changes in Fund Balances - Budget and Actual Emergency Services District Fund For the Year Ended September 30, 2014 REVENUES Taxes Intergovernmental Charges for services Judgments, fines and forfeits Interest Miscellaneous Total revenues EXPENDITURES Current: Public safety Total expenditures Excess of revenues over (under) expenditures OTHER FINANCING SOURCES (USES) Transfers to constitutional officers Total other financing sources (uses) Net change in fund balances Fund balances at beginning of year Fund balances at end of year Budgeted Amounts Original Final Actual Amounts $ 19,742,353 42,750 4,666,226 2,850 73,625 122,371 $ 19,742,353 60,189 4,766,226 2,850 73,625 122,371 $ 20,064,393 $ 82,765 5,480,257 11,000 37,085 20,547 Variance with Final Budget Positive (Negative) 322,040 22,576 714,031 8,150 (36,540) (101,824) 24,650,175 24,767,614 25,696,047 928,433 25,245,666 26,139,776 25,103,305 1,036,471 25,245,666 26,139,776 25,103,305 1,036,471 (595,491) (1,372,162) (425,395) (430,819) (425,395) (430,819) 592,742 1,964,904 (428,081) (428,081) 2,738 2,738 (1,020,886) (1,802,981) 164,661 $ 1,967,642 1,020,886 1,802,981 9,382,595 $ 9,547,256 The accompanying notes are an integral part of the financial statements. 236 Indian River County, Florida Board of County Commissioners Statement of Fund Net Position Proprietary Funds September 30, 2014 Enterprise Funds Solid Waste Disposal Golf County County District Course Utilities Building Total Internal Service Funds ASSETS Current assets: Cash and cash equivalents $ 10,469,912 $ 8,528 $ 36,525,585 $ 5,335,093 $ 52,339,118 $ 32,479,856 Accounts receivable - net 122,963 - 2,383,075 2,506,038 324,454 Due from other governments 90,203 10,800 - 101,003 69,873 Interest receivable 7,927 192 526,182 2,908 537,209 16,711 Inventories - 57,791 896,779 - 954,570 189,768 Prepaid items 395 160,838 971 162,204 1,149,813 Current restricted assets: Cash and cash equivalents 14,796,093 32,142,579 46,938,672 Total current assets 25,487,098 77,706 72,635,038 5,338,972 103,538,814 34,230,475 Non-current assets: Capital assets - non -depreciable 13,359,177 7,774,283 19,175,976 - 40,309,436 Capital assets - depreciable 31,304,613 2,346,803 411,680,098 366,423 445,697,937 2,393,687 Capital assets - accumulated depreciation (10,458,217) (1,965,309) (224,405,359) (330,207) (237,159,092) (2,009,148) Non-current restricted assets: Special assessments receivable 692,133 692,133 Impact fees receivable 1.098,237 1,098,237 Liens receivable 3,902,046 3,902,046 Total non-current assets 34,205,573 8,155,777 212,143,131 36,216 254,540,697 384,539 Total assets 59,692,671 8,233,483 284,778,169 5,375,188 358,079,511 34,615,014 DEFERRED OUTFLOWS OF RESOURCES Deferred amounts on refundings - 2,245,798 2,245,798 - Total deferred outflows of resources 2,245,798 2,245,798 LIABILITIES Current liabilities (payable from current assets): Accounts payable 893,214 13,385 2,010,722 64,241 2,981,562 228,089 Retainage payable - 58,400 447,333 - 505,733 - Due to other funds 865,051 - 865,051 7 000 Claims payable - - - 3 181.891 Due to other govemments 6,145 18,790 24,935 Other deposits 1,000 - 1,000 Unearned revenues 32,771 - 32.771 - Pollution remediation costs payable - - 5,500 - 5,500 Accrued compensated absences 40,365 20,536 467,967 57,756 586,624 54,327 Total current liabilities (payable from current assets) 933,579 997,288 2,931,522 140,787 5,003.176 3,471,307 Current liabilities (payable from restricted assets): Accounts payable 23,398 23,398 Retainage payable - 31,410 31,410 Accrued interest payable 150,288 150,288 Bonds payable - 3,485,000 3,485,000 Customer deposits 133,626 2,808,885 2,942,511 Total current liabilities (payable from restricted assets) 133,626 6,498,981 6,632,607 Total current liabilities 1,067,205 997,288 9,430,503 140,787 11,635,783 3,471,307 Non-current liabilities: Accrued compensated absences 8,454 39,394 199,057 20,028 266,933 50,926 Advance from other funds - 877,237 - - 877,237 Claims payable - - 5,044.654 Pollution remediation costs payable - 6,000 - 6,000 Closure and maintenance costs payable 11,509 736 - 11,509,736 Bonds payable - net of unamortized discount/premium - 35,948,889 35,948,889 Total non-current liabilities 11,518,190 916,631 36,153,946 20028 48,608,795 5,095.580 Total liabilities 12,585,395 1,913,919 45,584.449 160.815 60.244,578 8,566,887 NET POSITION Net investment in capital assets 34,205,573 8,155,777 169,262.624 36,216 211 660,190 384,539 Unrestricted 12,901,703 (1,836,213) 72,176,894 5178,157 88,420,541 25,663,588 Total net position $ 47,107,276 $ 6,319,564 $ 241,439.518 $ 5,214,373 $ 300,080,731 $ 26,048,127 The accompanyine notes are an integral part of the financial statements. 237 1 Indian River County, Florida Board of County Commissioners Statement of Revenues, Expenses, and Changes in Fund Net Position Proprietary Funds For the Year Ended September 30, 2014 I Enterprise Funds Solid Waste 1 Disposal Golf District Course OPERATING REVENUES 1 Charges for services $ 10,272,415 $ 3,080,960 Charges for services pledged as security for revenue bonds - - Total operating revenues 10,272,415 3,080,960 OPERATING EXPENSES Personal services 534,751 501,566 Material, supplies, services and other operating 9,337,279 1,833,079 Depreciation 929,378 208,949 Total operating expenses 10,801,408 2,543,594 Operating income (loss) (528,993) 537,366 NONOPERATING REVENUES (EXPENSES) Interest income 109,251 1,981 Interest income pledged as security for revenue bonds Gain on disposal of equipment 330 Interest expense (44,830) Bond amortization expense - Loss on disposal of equipment Total nonoperating revenues (expenses) 1 09,251 (42,519) 1 Income (loss) before transfers and capital contributions (419,742) 494,847 I Capital grants and contributions 61,327 Transfers (75,414) Change in net position (433,829) 494,847 Total net position - beginning 47,541,105 5,824,717 Total net position - ending $ 47,107,276 $ 6,319,564 1 1 1 1 1 The accompanying notes are an integral part of the financial statements. $ County County Utilities Building 29,565,901 Total Internal Service Funds $ 2,417,724 $ 15,771,099 $ 22,543,318 29,565,901 2,417,724 29,565,901 45,337,000 22,543,318 7,609,569 1,183,025 9,828,911 3,940,425 11,776,672 636,517 23,583,547 20,618,835 14,432,329 13,986 15,584,642 176,169 33,818,570 1,833,528 (4,252,669) 584,196 258,740 (1,929,183) (24,209) (49,325) 11,525 1 (1,743,977) 11,526 (5,996,646) 5,014,715 75,414 48,997,100 24,735,429 (3,660,100) (2,192,111) 122,757 75,022 258,740 331 (1,974,013) (24,209) (49,325) (1,665,719) 75,022 595,722 (5,325,819) 5,076,042 (2,117,089) 158,653 152,336 (906,517) 595,722 (249,777) (1,806,100) 242,346,035 4,618,651 300,330,508 27,854,227 $ 241,439,518 $ 5,214,373 $ 300,080,731 $ 26,048,127 Indian River County, Florida Board of County Commissioners Statement of Cash Flows Proprietary Funds For the Year Ended September 30, 2014 CASH FLOWS FROM OPERATING ACTIVITIES Cash received from customers Cash paid to suppliers for goods and services Cash paid to employees for services Net cash provided by (used in) operating activities CASH FLOWS FROM NONCAPITAL FINANCING ACTIVITIES Transfers Payments on advances from other funds Net cash provided by (used in) noncapital financing activities CASH FLOWS FROM CAPITAL AND RELATED FINANCING ACTIVITIES Principal payments - bonds/notes Interest paid on long-term debt Proceeds from advances from other funds Payments on advances from other funds Proceeds from sales of capital assets Purchase of capital assets Bond paying agent and arbitrage fees Capital grants and contributions Net cash provided by (used in) capital and related financing activities CASH FLOWS FROM INVESTING ACTIVITIES Interest and dividends on investments Net cash provided by investing activities Net increase (decrease) in cash and cash equivalents Cash and cash equivalents at beginning of year Cash and cash equivalents at end of year Classified as: Current assets Restricted assets Totals Enterprise Funds Solid Waste Disposal District $ 10,320,332 (9,306,535) (524,959) 488,838 (216,891) (216,891) 111,082 111,082 383,029 24,882,976 Golf Course $ 3,083,187 (1,865,212) (493,774) $ 25,266,005 $ $ 10,469,912 $ 14,796,093 $ 25,266,005 $ The accompanying notes are an integral part of the financial statements. 240 724,201 (585,000) (585,000) (43,527) 630,000 (56,322) 330 (1,120,928) (973) (591,420) 2,212 2,212 (450,007) 458,535 8,528 8,528 8,528 v 1 1 1 a e v 1 1 1 1 1 County Utilities $ 29,043,372 (14,244,858) (7,574,925) 7,223,589 (3,350,000) (1,93 7,449) (10,031,448) (2,900) 3,259,071 (12,062,726) 287,171 287,171 (4,551,966) 73,220,130 County Building $ 2,417,724 (612,392) (1,196,328) $ 68,668,164 $ $ 36,525,585 $ 32,142,579 609,004 1 (19,714) (19,713) 11,772 11,772 601,063 Total $ 44,864,615 (26,028,997) (9,789,986) 9,045,632 (585,000) (585,000) (3,350,000) (1,980,976) 630,000 (56,322) 331 (11,388,981) (3,873) 3,259,071 (12,890,750) 412,237 412,237 (4,017,881) Internal Service Funds $ 22,395,656 (20,294,226) (3,888,999) (1,787,569) 152,336 (310,000) (157,664) (188,656) (188,656) 80,029 80,029 (2,053,860) 4,734,030 103,295,671 34,533,716 5,335,093 $ 99,277,790 $ 32,479,856 5,335,093 $ 52,339,118 $ 46,93 8,672 32,479,856 68,668,164 $ 5,335,093 $ 99,277,790 $ 32,479,856 Continued Indian River County, Florida Board of County Commissioners Statement of Cash Flows Proprietary Funds For the Year Ended September 30, 2014 RECONCILIATION OF NET OPERATING INCOME (LOSS) TO NET CASH PROVIDED BY (USED IN) OPERATING ACTIVITIES Operating income (loss) Adjustments to reconcile operating income to net cash provided by operating activities: Enterprise Funds Solid Waste Disposal Golf District Course $ (528,993) $ 537,366 Depreciation 929,378 208,949 Work in progress reclassified as expense - - (Increase) Decrease in assets: Accounts receivable 33,694 Due from other governments 11,723 200 Inventories - (2,708) Liens receivable - - Impact fees receivable - - Special assessments receivable Prepaid items - 200 Increase (Decrease) in liabilities: Accounts payable (467,256) (28,483) Due to other governments (1,142) Retainage payable - - Customer deposits 2,500 Closure and maintenance costs payable 498,000 Pollution remediation costs payable - - Unearned revenues - 2,027 Claims payable Accrued compensated absences 9,792 7,792 Total adjustments Net cash provided by (used in) operating activities NONCASH CAPITAL AND RELATED FINANCING ACTIVITIES 1,017,831 186,835 $ 488,838 $ 724,201 Change in fair value of investments $ 2,259 $ Capital grants and contributions $ 61,327 $ Capital assets purchased through accounts payable $ 18,207 $ The accompanying notes are an integral part of the financial statements 242 55 County County Internal Utilities Building Total Service Funds $ (4,252,669) $ 584,196 $ (3,660,100) $ (2,192,111) 14,432,3 29 13,986 15,5 84,642 176,169 170,712 - 170,712 94,488 128,182 (190,221) 349,638 - 361,561 42,559 (47,874) - (50,582) (12,808) (322,413) - (322,413) 145,635 - 145,635 (746,494) - (746,494) 57,719 (971) 56,948 76,210 129,110 21,610 (345,019) 108,662 (2,827,524) 3,486 (2,825,180) 48,671 - 48,671 (43,383) (40,883) 498,000 1,000 - 1,000 - - 2,027 - - 152,545 34,644 (13,303) 38,925 51,426 11,476,258 24,808 12,705,732 404,542 $ 7,223,589 $ 609,004 $ 9,045,632 $ (1,787,569) $ 9,482 $ 829 $ 12,625 $ 4,764 $ 1,755,644 $ - $ 1,816,971 $ 158,653 $ 752,778 $ - $ 770,985 $ Indian River County, Florida Board of County Commissioners Statement of Fiduciary Net Position Fiduciary Funds September 30, 2014 Other Postemployment Agency Benefits Trust ASSETS Cash and cash equivalents $ 2,887,849 $ Investments, at fair value: Index funds 6,983,499 U.S. government securities funds - 5,860,758 Primary money market fund 1,194,575 Total assets $ 2,887,849 $ 14,038,832 LIABILITIES Accounts payable $ 419,713 $ Other deposits held in escrow 2,468,136 Total liabilities $ 2,887,849 NET POSITION Assets held in trust for other postemployment benefits 14,038,832 Total net position $ 14,038,832 The accompanying notes are an integral part of the financial statements. 244 Indian River County, Florida Board of County Commissioners Statement of Changes in Fiduciary Net Position Other Postemployment Benefits Trust Fund For the Year Ended September 30, 2014 ADDITIONS Employer contributions $ 3,426,879 Investment income 765,759 Investment expense (1,440) Total additions 4,191,198 DEDUCTIONS Benefits payments Total deductions 1,724,334 1,724,334 Change in net position 2,466,864 Net position - beginning Net position - ending 11,571,968 $ 14,038,832 The accompanying notes are an integral part of the financial statements. 245 MD MO WM MEI UM art ON ting 2361 MS CNN NES MEN ME MS d N Indian River County, Florida Board of County Commissioners Notes To Financial Statements Year Ended September 30, 2014 NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES The Board of County Commissioners (the "Board") is a County agency and a local governmental entity pursuant to Article VIII, Section 1(e) of the Constitution of the State of Florida. For financial statement and reporting purposes, the Board does not meet the definition of a legally separate organization and is not considered to be a component unit. The Board is considered to be a part of the primary government of Indian River County. The financial statements contained herein represent the financial transactions of the Board only. The following is a summary of the significant accounting principles and policies used in the preparation of the accompanying financial statements. A. Reporting Entity The concept underlying the definition of the reporting entity is that elected officials are accountable to their constituents for their actions. The reporting entity's financial statements should allow users to distinguish between the primary government (the Board) and its component units. However, some component units, because of the closeness of their relationship with the Board, should be blended as though they are part of the Board. Otherwise, most component units should be discretely presented. As required by generally accepted accounting principles, the financial reporting entity consists of: (1) the primary government (the Board), (2) organizations for which the Board is financially accountable, and (3) other organizations for which the nature and significance of their relationship with the Board are such that exclusion would cause the reporting entity's financial statements to be misleading or incomplete. The Board is financially accountable if it (a) serves as the governing body of the legally separate organization and there is a financial burden/benefit relationship or management has operational responsibility of the organization, (b) the organization provides almost exclusive service or benefit to the primary government, or (c) total debt of the organization is repayable almost entirely from the resources of the primary government. Based on these criteria, management determined that the Solid Waste Disposal District and the Emergency Services District were the only organizations that should be included in the Board's financial statements as blended component units. Blended Component Units Solid Waste Disposal District (SWDD) — Created pursuant to County Ordinance 87-67, the Board of County Commissioners serves as the governing body for and has operational responsibility over the SWDD. The Board also sets the non ad valorem assessment fees for the SWDD. Although legally separate, the SWDD is appropriately blended as a proprietary fund type (enterprise) component unit into the primary government. Emergency Services District (EMS) — Created pursuant to County Ordinance 90-25, the Board of County Commissioners serves as the governing body for and has operational responsibility over the EMS. The Board also sets the millage rate for the EMS. Although legally separate, the EMS is appropriately blended as a governmental fund type (special revenue) component unit into the primary government. 247 Indian River County, Florida Board of County Commissioners Notes To Financial Statements Year Ended September 30, 2014 NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - Continued B. Fund Financial Statements The underlying accounting system of the Board is organized and operated on the basis of separate funds, each of which is considered to be 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, fund balances, revenues and expenditures or expenses, as appropriate. Governmental resources are allocated to and accounted for in individual funds based upon the purposes for which they are to be spent and the means by which spending activities are controlled. Fund financial statements for the Board's governmental, proprietary, and fiduciary funds are presented. Governmental accounting standards set forth minimum criteria (percentage of the assets plus deferred outflows of resources, liabilities plus deferred inflows of resources, revenues or expenditures/expenses of either fund category and the governmental and enterprise combined) for the determination of major funds. These statements display information about major funds individually and nonmajor funds in the aggregate for governmental and enterprise funds. The Statement of Fiduciary Net Position presents assets held by the Board in a custodial capacity for other individuals or organizations. See Note 17 for more information on the spending hierarchy of fund balances in the fund financial statements. Governmental Funds 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 collectable within the current period or soon enough thereafter to pay liabilities of the current period. For this purpose, the Board considers revenues to be available if they are collected within 45 days after the end of the current fiscal period. Expenditures generally are recorded when a liability is incurred, as under accrual accounting. Franchise fees, sales taxes, gas taxes, operating and capital grants, and interest associated with the current fiscal period are all considered to be susceptible to accrual and so have been recognized as revenues of the current fiscal period. All other revenue items are considered to be measurable only when cash is received by the Board. Under the current financial resources measurement focus, only current assets, deferred outflows of resources, current liabilities, and deferred inflows of resources are generally included on the balance sheet. The reported fund balance is considered to be a measure of available spendable resources. Governmental funds operating statements present increases (revenues and other financing sources) and decreases (expenditures and other financing uses) in fund balances. Accordingly, they are said to present a summary of sources and uses of "available spendable resources" during a period. Long-term receivables are reported on their balance sheets in spite of their spending measurement focus. Advances and notes to other funds are offset as nonspendable fund balance. See Note 17 for more information on the categories and descriptions of fund balances in the fund financial statements. 248 Indian River County, Florida Board of County Commissioners Notes To Financial Statements Year Ended September 30, 2014 NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES — Continued B. Fund Financial Statements — Continued Because of their spending measurement focus, expenditure recognition for governmental fund types excludes amounts represented by non-current liabilities. Since they do not affect net current assets, such long-term amounts are not recognized as governmental fund type expenditures or fund liabilities. Amounts expended to acquire capital assets are recorded as expenditures in the year that resources were expended, rather than as fund assets. The proceeds of long-term debt are recorded as an other financing source rather than as a fund liability. Debt service expenditures, as well as expenditures related to compensated absences and claims and judgments, are recorded only when payment is due. Proprietary Funds The Board's enterprise and internal service funds are proprietary funds. In the fund financial statements, proprietary funds are presented using the accrual basis of accounting. Revenues are recognized when they are earned and expenses are recognized when the related goods or services are delivered. In the fund financial statements, proprietary funds are presented using the economic resources measurement focus. This means that all assets, deferred outflows of resources, liabilities, and deferred inflows of resources (whether current or non-current) associated with their activity are included on their balance sheets. Proprietary fund type operating statements present increases (revenues) and decreases (expenses) in total net position. Proprietary fund operating revenues, such as charges for services, result from exchange transactions associated with the principal activity of the fund. Exchange transactions are those in which each party receives and gives up essentially equal values. Non-operating revenues, such as subsidies, taxes, and investment earnings result from nonexchange transactions or ancillary activities. Amounts paid to acquire capital assets are capitalized as assets in the fund financial statements, rather than reported as an expense. Proceeds of long-term debt are recorded as a liability in the fund financial statements, rather than as an other financing source. Amounts paid to reduce long-term indebtedness are reported as a reduction of the related liabilities, rather than as an expense. Fiduciary Funds The fiduciary financial statements include financial information for the agency fund and the other postemployment benefits trust fund. The agency fund of the Board primarily represents assets held by the Board in a custodial capacity for other individuals or governments. The other postemployment benefits trust fund (Trust) accounts for activities of the Trust, which accumulates resources for health insurance benefit payments for current retirees and for current employees upon their retirement. The agency and Trust fund statements are presented using the accrual basis of accounting. 249 Indian River County, Florida Board of County Commissioners Notes To Financial Statements Year Ended September 30, 2014 NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - Continued B. Fund Financial Statements - Continued Governmental Major Funds General Fund — The General Fund is the general operating fund of the Board. It is used to account for all financial resources, except those accounted for and reported in another fund. Impact Fees Fund — The Impact Fees Fund accounts for the receipt of various impact fees. Funds are used for the construction of roads and bridges, correctional, public safety, library, park, public building, and solid waste facilities. Funds are also used for administrative expenditures of monitoring the aforementioned activities. Secondary Roads Construction Fund — The Secondary Roads Construction Fund accounts for the expenditures of road and bridge construction, roadway, bridge and right of way maintenance and drainage, and related administrative expenses. Financing is provided by collections of the local option gas tax. Transportation Fund — The Transportation Fund accounts for expenditures incurred for the maintenance and repair of county roads. Financing is provided by the 5th and 6th cent gas tax, County gas tax and transfers from the General Fund. Emergency Services District Fund — The Emergency Services District Fund accounts for the expenditures of providing fire protection and advanced life support to the County. Ad valorem taxes are the primary source of revenue. Optional Sales Tax Fund — The Optional Sales Tax Fund accounts for revenue generated by the local option one -cent sales tax and some capital grants that use the local option one -cent sales tax as matching funds. Monies are used for various capital projects. Proprietary Major Funds Solid Waste Disposal District — The Solid Waste Disposal District Fund accounts for the revenues, expenses, assets and liabilities associated with the County landfill. Golf Course Fund — The Golf Course Fund accounts for the revenues, expenses, assets and liabilities associated with the County golf course. County Utilities Fund — The County Utilities Fund accounts for the revenues, expenses, assets and liabilities associated with the County water and sewer system. County Building Fund — The County Building Fund accounts for revenues, expenses, assets, and liabilities associated with the County building permit and inspection program. 250 Indian River County, Florida Board of County Commissioners Notes To Financial Statements Year Ended September 30, 2014 NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - Continued B. Fund Financial Statements - Continued Other Fund Types Internal Service Funds — Internal Service Funds account for Fleet Management, Self Insurance and Information Technology services provided to other departments of the Board on a cost reimbursement basis. Agency Fund — The Agency Fund is used to account for assets held in a custodial capacity by the Board for other governmental units, other funds, individuals and businesses. Examples include payroll deductions, self insurance premiums, and developer escrow funds. Other Postemployment Benefits Trust Fund — The Other Postemployment Benefits Trust Fund accounts for activities of the Trust, which accumulates resources for health insurance benefit payments for current retirees and for current employees upon their retirement. Contributions are recorded when earned and benefit payments and refunds when incurred within each year. C. Cash and Cash Equivalents Cash and cash equivalents include deposits and all highly liquid investments with maturities of ninety days or less when purchased. The Board maintains a cash and investment pool that is available for use by all funds. Earnings for the pooled investments are allocated to the respective funds based on applicable cash participation by each fund. The investment pool is managed such that all participating funds have the ability to deposit and withdraw cash as if they were demand deposit accounts. Therefore, all balances representing participants' equity in the investment pools are classified as cash and cash equivalents for financial statement purposes. In addition, longer-term investments are held by several of the Board's funds and are, therefore, reported as current restricted cash and cash equivalents on these statements. D. Investments Investments consist of U.S. Treasury Securities, U.S. Government Agency Securities, money market funds, and the Florida Local Government Investment Trust Fund (FLGIT). Investments are reported at fair value based upon the average price obtained from three brokers/dealers. The FLGIT Fund values are based upon the fair market value per share of the underlying portfolio. Refer to Note 2-C, Investments, for further information on individual investments. E. Allowance for Doubtful Accounts The Board provides an allowance for water and sewer and ambulance service accounts receivables that may become uncollectable. At September 30, 2014, the allowance for water and sewer was $424,493 and for ambulance services was $644,383. No other allowances for doubtful accounts are maintained since other accounts receivable are considered collectable as reported at September 30, 2014. 251 Indian River County, Florida Board of County Commissioners Notes To Financial Statements Year Ended September 30, 2014 NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - Continued F. Inventories Inventories are valued at cost, which approximates market, using the "first -in, first -out" method of accounting, with the exception of the Golf Course and Fleet Internal Service Fund's inventories which are valued using the average cost method of accounting. Inventories of all funds are recorded as expenditures (expenses) when consumed rather than when purchased. G. Prepaid Items This account represents prepayments for services that will be used in future periods. The Board's policy is to record the expenditure for the services when they are used rather than when the cash is disbursed. H. Capital Assets Capital assets, which include property, plant, equipment, infrastructure (e.g., roads, bridges, right-of- ways, water and sewer distribution systems, beach restoration, stormwater systems and similar items), and intangible assets (e.g. software, easements, and rights), are reported in the applicable governmental or business -type activities column in the government -wide financial statements. The Board defines capital assets as assets with an initial, individual cost of $1,000 or more and an estimated useful life in excess of one year. Except for roads and bridges constructed prior to October 1, 1981, assets are recorded at historical cost. Roads and bridges constructed prior to October 1, 1981 are reported at estimated historical cost. Donated capital assets are recorded at estimated fair market value at the date of donations. Transfers of capital assets within the Board are recorded at their carrying value at the time of the transfer. The costs of normal maintenance and repairs that do not add to the value of the asset nor materially extend its useful life are not capitalized. Major outlays for capital assets and improvements are capitalized as projects are constructed. Interest incurred during the construction phase of capital assets of business -type activities is included as part of the capitalized value of the assets constructed. The Board holds legal title to the capital assets used in the operations of the Board, Clerk of the Circuit Court and Comptroller, Property Appraiser, Supervisor of Elections and Tax Collector, and is accountable for them under Florida Law. Capital assets used by the Board's governmental funds are reported in the financial statements of the County. Capital assets of the Board's enterprise and internal service funds are reported in the Proprietary Funds' financial statements. 252 1 1 1 1 1 Indian River County, Florida Board of County Commissioners Notes To Financial Statements Year Ended September 30, 2014 NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES — Continued H. Capital Assets - Continued Property, plant, equipment, intangible, and infrastructure assets of the primary government, as well as the component units, are depreciated, or amortized as in the case of intangible assets, using the straight- line method over the following estimated useful lives: Assets Years Building and improvements 10 — 50 Machinery and equipment 3 — 10 Utility distribution systems 25 — 50 Road and bridge infrastructure 20 — 50 Fiberoptics 20 Software 3-5 Beach preservation infrastructure 7 Stormwater infrastructure 30 I. Capitalization of Interest Interest costs related to bond issues are capitalized during the construction period. These costs are netted against applicable interest earnings on construction fund investments. During the current period, the Board did not have any capitalized interest. J. Deferred Outflows/Inflows of Resources Deferred outflows of resources represent a consumption of net position/fund balance that applies to a future period(s) and so will not be recognized as an outflow of resources (expense/expenditure) until then. The Board only has one item that qualifies for reporting in this category. It is the deferred charge on refunding reported on the Statement of Fund Net Position for the Proprietary funds. A deferred charge on refunding results from the difference in the carrying value of refunded debt and its reacquisition price. This amount is deferred and amortized over the shorter of the life of the refunding debt. Deferred inflows of resources represent an acquisition of net position/fund balance that applies to a future period(s) and so will not be recognized as an inflow of resources (revenue) until then. The Board has only one type of item, which arises under a modified accrual basis of accounting, which qualifies for reporting in this category. Unavailable revenue is reported only in the governmental funds balance sheet. The source of the unavailable revenue is a special assessment on road paving, ambulance service billings, and state and federal grant revenues. These amounts are deferred and recognized as an inflow of resources in the period the amounts become available. 253 Indian River County, Florida Board of County Commissioners Notes To Financial Statements Year Ended September 30, 2014 NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES — Continued K. Unamortized Bond Discounts and Premiums Bond discounts and premiums associated with the issuance of Proprietary Fund revenue bonds are amortized over the life of the bonds according to the straight-line method. For financial reporting, unamortized bond discounts and premiums are netted against the applicable long-term debt. L. Landfill Closure Costs Under the terms of current state and federal regulations, the Solid Waste Disposal District (SWDD) is required to place a final cover on closed landfill areas, and to perform certain monitoring and maintenance functions for a period of up to thirty years after closure. The SWDD recognizes these costs of closure and post -closure maintenance over the active life of each landfill area, based on landfill capacity used during the period. Required obligations for closure and post -closure costs are recognized in the Solid Waste Disposal District Enterprise Fund. M. Unearned Revenues In governmental fund financial statements (in accordance with the modified accrual basis of accounting), unearned revenues represent revenues, which are available but not earned. N. Accrued Compensated Absences The Board does not report compensated absences in the governmental fund statements since they are not current liabilities payable from available spendable resources. They are reported in the financial statements of the County. Proprietary fund types accrue compensated absences in the period they are earned. -O. Obligation for Bond Arbitrage Rebate Pursuant to Section 148(f) of the U.S. Internal Revenue Code, the Board must rebate to the United States Government the excess of interest earned from the investment of certain debt proceeds and pledged revenues over the yield rate of the applicable debt. The Board has no arbitrage liability outstanding as of September 30, 2014. 254 Indian River County, Florida Board of County Commissioners Notes To Financial Statements Year Ended September 30, 2014 NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES — Continued P. Budgets and Budgetary Accounting The Board uses the following procedures in establishing the budgetary data reflected in the financial statements: 1. The constitutional officers submit, at various times, to the Board and to certain divisions within the Florida Department of Revenue and the Florida Clerks of Court Operations Corporation, a proposed operating budget for the following fiscal year. The operating budget includes proposed expenditures and the means of financing them, as set forth in Chapter 129 of the Florida Statutes. 2. The Department of Revenue, State of Florida, has the final authority on the operating budgets for the Tax Collector and the Property Appraiser included in the General Fund. 3. Constitutional officers, all departments controlled by the Board, and outside state and local agencies submit their proposed budgets to the Office of Management and Budget for assistance, review, and compilation. The County Administrator then reviews all County departments, state agencies, and nonprofit organization's budgets and makes his budget recommendation to the Board. 4. On or before July 15 of each year, the County Administrator and the Director of the Office of Management and Budget, as the Board's designated budget officer, submit to the Board a tentative budget for the ensuing fiscal year. The tentative budget includes proposed expenditures and the means of financing them. The Board then holds workshops to review the tentative budget by fund on a departmental level. 5. During September, public hearings are held pursuant to Section 200.065 of the Florida Statutes in order for the Board to receive public input on the tentative budget. At the end of the last public hearing, the Board enacts resolutions to legally adopt the budgets at the fund level for all governmental and proprietary fund types. The budgets legally adopted by the Board set forth the anticipated revenues by source and the appropriations by function. 6. Formal budgetary integration on an object level is used as a management control device for the governmental and proprietary funds of the Board. Management is authorized to transfer budgeted amounts between objects and departments in any fund as long as management does not exceed the total appropriations of a fund. Board approval to amend the budget is only required when unanticipated revenues are received that management wishes to have appropriated, thereby increasing the total appropriations of a fund. 7. Budgets for the governmental and proprietary fund types are adopted on a basis consistent with generally accepted accounting principles. 8. Appropriations for the Board lapse at the close of the fiscal year. 255 Indian River County, )Florida Board of County Commissioners Notes To Financial Statements Year Ended September 30, 2014 NOTE 2 - CASH AND CASH EQUIVALENTS The Board maintains a cash and investment pool that is available for use by all funds except those whose cash and investments must be segregated due to bond covenants or other legal restrictions. A. Deposits At September 30, 2014, the carrying value of the Board's deposits was $20,217,767 and the bank balance was $21,843,381. All the deposits were covered by the FDIC or collateralized in accordance with Chapter 280, Florida Statutes, also known as the "Florida Security for Public Deposits Act". Cash on hand at September 30, 2014 was $8,200. B. Accrued Interest Interest earnings on U.S. Treasury Notes and government agency bonds are recorded in the cash and investment pools and then allocated to each fund based on each fund's average monthly balance. As of September 30, 2014, accrued interest for the Board's portfolio totaled $108,191 and was allocated to the funds based on their average monthly balance for September. The remaining accrued interest is reflected in utilities and road paving assessments. 256 Indian River County, Florida Board of County Commissioners Notes To Financial Statements Year Ended September 30, 2014 NOTE 2 - CASH AND CASH EQUIVALENTS - Continued C. Investments On July 24, 2014, the Board of County Commissioners updated its investment policy to reflect the following change in valuing the portfolio: the portfolio will be marked to market with an average of three brokers' evaluations. As of September 30, 2014, the Board had the following investments: Investment Type Fixed Rate Debt -Instruments: U.S. Treasuries U.S. Agencies:*** Federal Farm Credit Bureau Federal Home Loan Bank Federal Home Loan Mortgage Federal National Mortgage Assoc. Other Fixed Rate Investments: Harbor Community Bank CD Other Market Rate Investments: Regions Bank Money Market TD Bank Money Market BankUnited Money Market Florida Local Government Investment Trust Fund W&S Sinking Fund Reserve: U.S. Treasuries Fidelity Institutional Money Market Total Fair Value Fair Value $ 120,071,970 29,977,122 26,968,778 15,970,150 6,999,102 Weighted Average Maturity Portfolio InYears Percentage Credit Risks* 0.95 43.02 % N/A 0.79 1.16 1.57 0.27 3,016,949 1.35 13,091,698 20,027,524 26,058,781 0.08 0.08 0.08 11,448,484 0.08 5,460,324 7,784 $ 279,098,666 Weighted Average Maturity of Investments 1.03 0.08 0.76 10.74 9.66 5.72 2.51 AA+ AA+ AA+ AA+ 1.08 N/A 4.69 N/A 7.18 N/A 9.34 N/A AAAf and 4.10 S-1** 1.96 N/A 100.00 % * Ratings based upon Standard and Poor's ** AAAf credit quality, S-1 Market Volatility *** The weighted calculation considers the investments are carried until full maturity (i.e. call dates are not considered). 257 AAAm Indian River County, Florida Board of County Commissioners Notes To Financial Statements Year Ended September 30, 2014 NOTE 2 - CASH AND CASH EQUIVALENTS - Continued C. Investments — Continued The Florida Local Government Investment Trust Fund is a pool of various securities with maturities of less than five years. The fund was established by Florida Statute 163.01, is administered by the Florida Association of Court Clerks, and is marked to market daily. Interest Rate Risk The Board's investment policy limits interest rate risk by attempting to match investment maturities with known cash needs and anticipated cash flow requirements. All investments must have stated maturities of ten (10) years or less and no more than 25% of the portfolio shall be invested in instruments with stated final maturities greater than five (5) years. The portfolio shall have securities with varying maturity and at least 10% of the portfolio shall be invested in readily available funds. Credit Risks Florida Statutes, Section 218.415 and the Board's investment policy limit investments to the following: 1. Direct obligations of the United States Treasury; 2. Florida PRIME (formerly known as Fund A); 3. Florida Local Government Investment Trust Fund; 4. Interest-bearing time deposits or savings in qualified public depositories as defined in Section 280.02, Florida Statutes; 5. Federal agencies and instrumentalities; 6. Securities of, or other interests in, any open-end or closed-end management -type investment company or investment trust registered under the Investment Company Act of 1940, 15 U.S.C. ss. 80a-1 et seq., as amended from time to time, provided that the portfolio of such investment company or investment trust is limited to obligations of the United States Government or any agency or instrumentality thereof and to repurchase agreements fully collateralized by such United States Government obligations, and provided that such investment company or investment trust takes delivery of such collateral either directly or through an authorized custodian; 7. Securities and Exchange Commission registered money market funds with the highest credit quality rating from a nationally recognized rating agency; 8. Repurchase agreements with a term of one year or less collateralized by direct obligations of the United States Government which have maturities of three (3) years or less and a market value 103% or more of the repurchase amount. 258 Indian River County, Florida Board of County Commissioners Notes To Financial Statements Year Ended September 30, 2014 NOTE 2 - CASH AND CASH EQUIVALENTS - Continued C. Investments — Continued Concentration Risk The Board's investment policy has established asset allocation and issuer limits to reduce concentration of credit risk in the Board's investment portfolio. The Board's investment policy does not allow for more than 20% of the entire portfolio to be invested in any one issuer, with the exception of United States Treasury Obligations and state authorized pools. No more than 10% of the portfolio may be placed in certificates of deposit and no more than $3 million of the portfolio may be placed in certificates of deposit with any one financial institution. No more than 10% of the portfolio may be placed in any one money market fund, mutual fund, or intergovernmental investment pool. Custodial Credit Risk The Board's investment policy pursuant to Section 218.415 (18), Florida Statutes, requires securities to be registered and held with a third party custodian. All securities purchased, as well as all collateral obtained, by the Board shall be held in the name of the Board. The securities must be held in an account separate and apart from the assets of the financial institution. As of September 30, 2014 the Board's investment portfolio in U.S. Treasuries, U.S. Agencies, and money market funds was held by The Bank of New York/Mellon. Additional investments include the following: Money Markets at Regions Bank, TD Bank, and Bank United, Harbor Community Bank Certificate of Deposit, and the Florida Local Government Investment Trust (held by the Bank of New York/Mellon). D. OPEB Trust Investments Funds are held in the name of the Indian River County OPEB Trust (IRCOT), an irrevocable trust, by a third party custodian, Bank of New York/Mellon. The investments are reported at fair value based upon market -close price on the last business day of each month. The Board approved a separate investment policy for the IRCOT assets on February 3, 2009 (last amended on November 5, 2013). The Board adopted a broadly diversified portfolio composition consisting of equity, debt, and cash and cash equivalents. Asset allocations are divided between short term and long term investments. Short term asset allocations include cash and cash equivalents with maturities of 180 days or less. Long term asset allocations range from 0-60% for equities, 0-60% for fixed income securities, and 0-100% for cash and cash equivalents. 259 Indian River County, Florida Board of County Commissioners Notes To Financial Statements Year Ended September 30, 2014 NOTE 2 - CASH AND CASH EQUIVALENTS - Continued D. OPEB Trust Investments - Continued The contribution of $3.43 million for the year ended September 30, 2014 was invested in the various funds listed below. As of September 30, 2014, the Indian River County OPEB Trust (IRCOT) had the following investments: Investment Type Short -Term Portion: Weighted Average Maturity Portfolio Credit Fair Value InYears Percentage Risks* Fidelity Treasury Money Market $ 7,263 0.11 Long -Term Portion: 0.05% AAAm Vanguard 500 Index 3,146,175 N/A 22.41 N/A Vanguard All World Ex -US 2,773,589 N/A 19.76 N/A Vanguard Mid Cap Index 717,849 N/A 5.11 N/A Vanguard Small Cap Index 345,886 N/A 2.46 N/A Vanguard Short Term Treasury 4,238,737 2.60 30.19 AA+ Vanguard Intermediate Treasury 1,409,132 5.90 10.04 AA+ Vanguard Prime Money Market 1,194,575 0.16 8.51 A-1 Vanguard Federal Money Market 205,626 0.16 1.47 A-1 Total Fair Value $ 14,038,832 100.00% * Ratings based upon Standard and Poor's NOTE 3 - PROPERTY TAX REVENUES Taxable values for all property are established as of January 1, which is the date of lien, for the fiscal year starting October 1. Property tax revenues recognized for the 2013-2014 fiscal year were levied in October 2013. All taxes are due and payable on November 1 or as soon as the assessments roll is certified and delivered to the Tax Collector. Discounts are allowed for early payment at the rate of 4% in November, 3% in December, 2% in January, and 1% in February. Taxes paid in March are without discount. All unpaid taxes become delinquent as of April 1. Virtually all unpaid taxes are collected via the sale of tax certificates on or prior to June 1; therefore, there were no material taxes receivable at fiscal year-end. 260 NOTE 4 — CAPITAL ASSETS A. Indian River County, Florida Board of County Commissioners Notes To Financial Statements Year Ended September 30, 2014 Governmental Fund Type Capital Assets A summary of changes in the Governmental fund type capital assets is as follows: Land Balance 10/1/2013 $ 140,713,835 Additions 194,953 Deletions (7,633,990) Balance 9/30/2014 $ 133,274,798 Buildings And Improvements Equipment Intangibles Infrastructure $ 197,332,642 $ 36,455,470 $ 3,198,932 $ 369,697,078 13,891,957 2,225,799 465,732 9,348,723 (147,559) (1,742,613) (84,128) (120,307) $ 211,077,040 $ 36,938,656 $ 3,580,536 $ 378,925,494 Construction In Progress Total $ 36,893,868 $ 784,291,825 23,582,133 49,709,297 (17,013,947) (26,742,544) $ 43,462,054 $ 807,258,578 Beginning balance amounts have been adjusted for construction in progress that are contributed to and reported by a grant sub -recipient. Depreciation expense, which includes amortization expense on intangible assets, for governmental fund type capital assets is not reported in the financial statements of the Board. Depreciation expense is reported in the financial statements of the County. Please refer to the County Notes for a more detailed explanation of the County's policy on depreciation. B. Proprietary Fund Type Capital Assets Enterprise Funds A summary of changes in the Enterprise fund type capital assets is as follows: Balance 10/1/2013 Additions Deletions Less: Accumulated Depreciation Balance 9/30/2014 Buildings And Land Improvements $ 21,286,010 $ 422,161,889 170,753 13,669,688 (147.988) 21,456,763 435,683,589 $ 21,456,763 Equipment intangibles $ 14,322,144 1,172,778 (529,314) Construction In Progress $ 2,368,254 213,405 (223,898,124) $ 211,785,465 14,965,608 2,581,659 (12,612,715) (648,253) $ 2,352,893 $ 1,933,406 Total $ 13,350,872 $ 473,489,169 10,330.452 25,557,076 (12,361,570) (13,038,872) 11,319,754 486,007,373 (237,159,092) $ 11,319,754 $ 248.848,281 261 Indian River County, Florida Board of County Commissioners Notes To Financial Statements Year Ended September 30, 2014 NOTE 4 — CAPITAL ASSETS - Continued B. Proprietary Fund Type Capital Assets - Continued Internal Service Funds A summary of changes in the Internal Service fund type capital assets is as follows: Balance 10/1/2013 Additions Deletions Less: Accumulated Depreciation Balance 9/30/2014 Buildings And Improvements Equipment Intangibles $ 18,152 (15,315) 2,837 (2,837) $ $ 411,848 581,554 (90,271) 903,131 (744,809) $ 695,695 792,024 1,487,719 (1,261,502) $ 158,322 $ 226,217 Total $ 1,125,695 1,373,578 (105,586) 2,393,687 (2,009,148) $ 384,539 NOTE 5 — RESTRICTED CASH AND CASH EQUIVALENTS AND INVESTMENTS Sinking funds Renewal and replacement Customer deposits Capital construction Closure and maintenance cost Total Solid Waste Disposal District $ 3,152,731 133,626 11,509,736 $ 14,796,093 County Utilities Total $ 6,212,648 $ 3,485,928 2,808,885 19,635,118 $ 32,142,579 262 6,212,648 6,638,659 2,942,511 19,635,118 11,509,736 $ 46,938,672 Indian River County, Florida Board of County Commissioners Notes To Financial Statements Year Ended September 30, 2014 NOTE 6 — PAYABLE FROM RESTRICTED ASSETS Liabilities payable from the Board's Enterprise Funds restricted assets are as follows: Accounts payable Retainage payable Accrued interest payable Bonds payable (current portion) Closure/maint. costs payable Customer deposits Total Solid Waste Disposal District $ 11,509,736 133,626 $ 11,643,362 NOTE 7 - INTERFUND BALANCES County Utilities $ 23,398 31,410 150,288 3,485,000 2,808,885 Total $ 23,398 31,410 150,288 3,485,000 11,509,736 2,942,511 $ 6,498,981 $ 18,142,343 Interfund balances at September 30, 2014, consisted of the following: Receivable Fund General Fund General Fund General Fund Payable Fund Amount Nonmajor Governmental Funds Golf Course Enterprise Fund Fleet Internal Service Fund $ 274,500 865,051 7,000 $ 1,146,551 In October 2010, the General Fund loaned $333,050 to the Golf Course Fund to purchase new golf carts. In September 2013, the General Fund loaned $1,565,000 to the Golf Course Fund for early payoff of the 2003 Recreational Revenue Bonds. In September 2014, the General Fund loaned $630,000 to the Golf Course Fund for a new irrigation system. The amount reported as due from the Golf Course Fund is the current portion of the scheduled payments due to the General Fund in fiscal year 2015. The remaining amount due from the Golf Course Fund is reported as an interfund advance. The amounts due from the Fleet Internal Service Fund and the Nonmajor Governmental Funds represent short-term cash loans that will be repaid within the next twelve months. 263 Indian River County, Florida Board of County Commissioners Notes To Financial Statements Year Ended September 30, 2014 NOTE 7 - INTERFUND BALANCES - Continued Interfund advance at September 30, 2014, consisted of the following: Receivable Fund Payable Fund Amount General Fund Golf Course Fund $ 877,237 This amount is considered a long-term advance between major funds expected to be paid over the course of several years. This amount has been presented as nonspendable on the General Fund Balance Sheet. NOTE 8 - INTERFUND TRANSFERS Interfund transfers for the year ended September 30, 2014, consisted of the following: Transfers In Transfers Out: General Fund Transportation Fund Optional Sales Tax Fund Solid Waste Disposal District Internal Service Fund Secondary Roads Nonmajor Internal General Construction Transportation Governmental Utilities Service Fund Fund Fund Funds Fund Fund Total $ $ - $ 7,657,704 $ 142,039 $ - $ 35,848 $ 7,835,591 258,613 125,000 383,613 8,512 183,393 183,393 75,414 75,414 8,512 Total $ 8,512 $ 258,613 $ 7,657,704 $ 325,432 $ 75,414 $ 160,848 $ 8,486,523 Transfers are used for the following purposes: 1) use unrestricted general fund revenues to finance transportation activities which are accounted for in a special revenue fund, 2) use unrestricted general fund revenues for beach restoration activities which must be accounted for in another fund, 3) use unrestricted general fund revenues to offset a portion of salaries and benefits expenses for an employee accounted for in the health insurance fund, 4) use transportation fund revenues to offset vehicle maintenance costs accounted for in the fleet internal service fund, 5) to account for transfers of capital assets between two enterprise funds, 6) to use general fund and capital project fund revenues for improvements to the Historic Dodgertown facility, 7) to reimburse the general fund from the self insurance fund for repairs at the shooting range, and 8) to account for reimbursement of street paving costs between the transportation and secondary roads construction funds. 264 Indian River County, Florida Board of County Commissioners Notes To Financial Statements Year Ended September 30, 2014 NOTE 9 — DUE FROM OTHER GOVERNMENTS Governmental Funds On November 18, 2008, the Board entered into a locally funded agreement with the Florida Department of Transportation (FDOT) to advance the six-laning of State Road 60 from 82nd Avenue to I-95 (Segment Two). The agreement obligated the Board to pay $14,429,754 to the FDOT. Payment was made in November 2008 to the FDOT. Funding was from the Optional Sales Tax Fund. Reimbursement by the FDOT for Segment Two will be in ten quarterly installments over a three-year period which began in July 2011. Repayments to the Board will include principal and any accumulated interest earnings that have not been used for supplemental costs of the project. Segment Two Amount Advance Funded Less: Reimbursements received as of 9/30/2014 Balance Due from FDOT SR60 Agreement Additional Funds Due from other governments Total Due from other governments Optional Sales Tax Fund 265 $ 14,429,754 (11,714,877) 2,714,877 2,121,837 $ 4,836,714 Indian River County, Florida Board of County Commissioners Notes To Financial Statements Year Ended September 30, 2014 NOTE 10 - ACCOUNTS PAYABLE Accounts Payable at September 30, 2014, were as follows: Governmental Funds: General Impact Fees Secondary Roads Construction Transportation Emergency Services Optional Sales Tax Other Governmental Total Governmental Funds Proprietary Funds: Payable from current assets: Solid Waste Golf Course Utilities Building Other Proprietary Payable from restricted assets: Utilities Total Proprietary Funds Vendors $ 1,094,312 1,325,559 536,329 302,621 129,983 452,272 606,933 $ 4,448,009 Salaries and Benefits $ 290,062 2,366 6,964 181,303 520,285 21,739 $ 1,022,719 $ 879,039 $ 2,756 1,819,698 31,805 194,030 23,398 $ 2,950,726 $ Total Accounts Payable $ 1,384,374 1,327,925 543,293 483,924 650,268 452,272 628,672 $ 5,470,728 14,175 $ 893,214 10,629 13,385 191,024 2,010,722 32,436 64,241 34,059 228,089 23,398 282,323 $ 3,233,049 The Board has not engaged in any short-term debt activity during fiscal year 2014 other than that listed in Note 7. 266 Indian River County, Florida Board of County Commissioners Notes To Financial Statements Year Ended September 30, 2014 NOTE 11 - LONG-TERM LIABILITIES A. Governmental Long -Term Debt Changes in Long -Term Liabilities Balance October 1, 2013 Additions Accrued Compensated Absences: $ 4,178,825 $ Bonds Payable: Limited General Obligation Bonds - 2006 Series 29,265,000 Spring Training Facility Revenue Bonds - 2001 Series 8,145,000 Total Bonds Payable 37,410,000 Grand Total $ 41,588,825 $ Deletions Balance September 30, 2014 2,349,301 $ 2,334,332 $ 4,193,794 3,255,000 26,010,000 445,000 7,700,000 3,700,000 33,710,000 2,349,301 $ 6,034,332 $ 37,903,794 Of the $4,193,794 liability for accrued compensated absences, management estimates that $2,219,260 will be due and payable within one year. The long-term liabilities are not reported in the financial statements of the Board since they are not payable from available spendable resources. They are reported in the financial statements of the County. The General Obligation Bonds and Spring Training Facility Revenue Bonds are not reported in the governmental fund statements since they are not current liabilities payable from available spendable resources. They are reported in the government -wide financial statements of the County. Payments on the above general obligation and revenue bonds are made by debt service funds (refer to the Table of Contents for these debt service funds under the category: Combining Balance Sheet and Combining Statement of Revenues, Expenditures and Changes in Fund Balances of Nonmajor Governmental Funds). 267 Indian River County, Florida Board of County Commissioners Notes To Financial Statements Year Ended September 30, 2014 NOTE 11 - LONG-TERM LIABILITIES — Continued A. Governmental Long -Term Debt - Continued Annual Debt Service Payments The annual debt service payments for bonds outstanding at September 30, 2014, are as follows: Fiscal Year Ending September 30 2015 2016 2017 2018 2019 2020-2024 2025-2029 2030-2031 Total Less: Current portion Add: Unamortized bond premium Total Limited General Obligation Bonds Series 2006 Principal $ 3,390,000 3,545,000 3,705,000 3,890,000 4,085,000 7,395,000 26,010,000 3,390,000 629,265 Interest $ 1,204,712 1,035,212 893,413 745,212 550,712 478,426 4,907,687 Spring Training Facility Revenue Bonds Series 2001 Principal $ 470,000 495,000 520,000 550,000 585,000 2,230,000 1,960,000 890,000 7,700,000 470,000 Interest $ 394,713 370,037 344,050 316,750 287,875 1,007,787 525,750 66,250 3,313,212 $ 23,249,265 $ 4,907,687 $ 7,230,000 $ 3,313,212 Limited General Obligation Bonds Purpose — On July 6, 2006, the Board issued $48,600,000 of Limited General Obligation Bonds, Series 2006. The issuance of the Series 2006 bonds was approved by a majority of votes cast in a bond referendum held on November 2, 2004, by the qualified electors of the County. The referendum authorized a total of $50,000,000 aggregate principal amount of limited general obligation bonds. The proceeds of this issue will provide funds to acquire interest in lands to protect water resources and/or drinking water sources, environmentally sensitive lands, historic sites, and/or agricultural lands together with the necessary preservation, restoration, remediation and reclamation activities to preserve and enhance such property. Pledge of revenues - The principal and interest on the bonds are payable from ad valorem taxes not exceeding '/2 mil and having a maturity not exceeding fifteen years, which are levied by the Board upon the taxable real and personal property of the Board. 268 Indian River County, Florida Board of County Commissioners Notes To Financial Statements Year Ended September 30, 2014 NOTE 11 - LONG-TERM LIABILITIES — Continued A. Governmental Long -Term Debt - Continued Limited General Obligation Bonds - Continued Bonds Issued - At September 30, 2014, Limited General Obligation Bonds consisted of the following: Description Limited General Obligation Bonds, 2006 Series Outstanding at Interest Rates September 30, and Date Maturity Issue 2014 4.00%-5.00% 1/1 and 7/1 2021 $ 48,600,000 $ 26,010,000 Optional Redemption - The Limited General Obligation Bonds, Series 2006, maturing on or after July 1, 2017, are subject to redemption prior to maturity, at the option of the Board on and after July 1, 2016, in whole or in part, at any time, on any date at a redemption price of par, together with accrued interest to the redemption date. Spring Training Facility Revenue Bonds Purpose - On August 15, 2001, the Board issued $16,810,000 of Spring Training Facility Revenue Bonds, Series 2001. The Series 2001 bonds are being issued by the Board to provide funds, together with other available funds, to (1) finance a portion of the cost of acquisition and expansion of a spring training facility currently known as "Historic Dodgertown"; (2) pay a premium for a municipal bond insurance policy and a debt service reserve account surety bond, and (3) pay certain costs and expenses incurred in connection with the issuance of the Series 2001 bonds. Pledge of Revenues - The principal and interest on the Series 2001 bonds will be payable from and secured by a first lien upon and pledge of the following, together with any investment income realized on any funds held under the Resolution, except the Cost of Issuance Account and the Rebate Fund: 1. Payments received by the Board from the State of Florida pursuant to Section 212.20, Florida Statutes; and 2. The Fourth Cent Tourist Development Tax levied by the County in Ordinance No. 2000-029, enacted pursuant to Section 125.0104(3)(1), Florida Statutes; and 3. Eighty-six percent (86%) of the Local Government Half -Cent Sales Tax distributed to the Board, pursuant to Chapter 218, part VI, Florida Statutes. The foregoing is collectively referred to herein as the "pledged revenues". These revenue streams are pledged for the remaining term of the bonds. 269 Indian River County, Florida Board of County Commissioners Notes To Financial Statements Year Ended September 30, 2014 NOTE 11 - LONG-TERM LIABILITIES - Continued A. Governmental Long -Term Debt — Continued Spring Training Facility Revenue Bonds - Continued The Fourth Cent Tourist Development Tax and the Local Government Half -Cent Sales Tax pledged to the payment of debt service on the Series 2001 bonds are automatically released as pledged revenue for the Series 2001 bonds immediately following the April 1, 2021 principal payment on the Series 2001 bonds. The current principal and interest payments of $863,075 represent nine percent of total pledged revenues. All three pledged revenue sources totaled $9,199,278 for the current fiscal year. The Board applied 100% of the state subsidy, 76% of the Fourth -Cent Tourist Tax, and none of the Half -Cent Sales Tax to the debt service payments. The total principal and interest remaining to be paid on the bonds is $11,013,212. Bonds Issued - At September 30, 2014, Spring Training Facility Revenue Bonds consisted of the following: Description Spring Training Facility Revenue Bonds, 2001 Series Outstanding at Interest Rates September 30, and Date Maturity Issue 2014 3.30%-5.25% 4/1 and 10/1 270 2031 $ 16,810,000 $ 7,700,000 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 Indian River County, Florida Board of County Commissioners Notes To Financial Statements Year Ended September 30, 2014 NOTE 11 - LONG-TERM LIABILITIES - Continued A. Governmental Long -Term Debt — Continued Spring Training Facility Revenue Bonds - Continued Remaining Mandatory Redemption - The Series 2001 Term Bonds are subject to mandatory redemption prior to maturity, by lot, at par plus accrued interest, according to the following schedule: Term Bonds due April 1, 2015 Date Principal Amount April 1, 2015 $ 470,000 Term Bonds due April 1, 2017 Date Principal Amount April 1, 2016 $ 495,000 April 1, 2017 520,000 Term Bonds due April 1, 2021 Date Principal Amount April 1, 2018 $ 550,000 April 1, 2019 585,000 April 1, 2020 615,000 April 1, 2021 650,000 Term Bonds due April 1, 2027 Date Principal Amount April 1, 2022 $ 305,000 April 1, 2023 320,000 April 1, 2024 340,000 April 1, 2025 355,000 April 1, 2026 375,000 April 1, 2027 390,000 Term Bonds due April 1, 2031 Date Principal Amount April 1, 2028 $ 410,000 April 1, 2029 430,000 April 1, 2030 455,000 April 1, 2031 435,000 271 Indian River County, Florida Board of County Commissioners Notes To Financial Statements Year Ended September 30, 2014 NOTE 11 - LONG-TERM LIABILITIES - Continued B. Proprietary Funds Long -Term Debt Changes in Long -Term Liabilities Accrued Compensated Absences Bonds Payable: Water & Sewer Revenue Refunding Series 2005 Water & Sewer Revenue Refunding Series 2009 Total Bonds Payable Grand Total Annual Debt Service Payments Balance October 1, 2013 Additions Deletions $ 868,692 $ 730,268 $ 640,150 $ 17,480,000 23,085,000 40,565,000 $ 41,433,692 $ 730,268 Balance September 30, 2014 958,810 1,605,000 15,875,000 1,745,000 21,340,000 3,350,000 37,215,000 $ 3,990,150 $ 38,173,810 The annual debt service payments for bonds outstanding at September 30, 2014 are as follows: Fiscal Year Ending September 30 2015 2016 2017 2018 2019 2020-2024 Total Less: Current portion Add: Unamortized bond premium Total Water and Sewer Revenue Refunding Bonds Series 2005 Principal Interest $ 1,670,000 1,750,000 1,840,000 1,930,000 2,025,000 6,660,000 $ 736,450 652,950 565,450 473,450 376,950 554,850 15,875,000 3,360,100 1,670,000 Water and Sewer Revenue Refunding Bonds Series 2009 Principal Interest $ 1,815,000 1,905,000 2,000,000 2,100,000 2,205,000 11,315,000 $ 1,067,000 976,250 881,000 781,000 676,000 1,612,250 21,340,000 5,993,500 1,815,000 487,304 1,731,585 $ 14,692,304 $ 3,360,100 $ 21,256,585 $ 5,993,500 272 Indian River County, Florida Board of County Commissioners Notes To Financial Statements Year Ended September 30, 2014 NOTE 11— LONG-TERM LIABILITIES - Continued B. Proprietary Funds Long -Term Debt - Continued Water and Sewer Revenue Refunding Bonds, Series 2005 Purpose - The Series 2005 bonds were issued to defease $31,680,000 of the Board's outstanding Water and Sewer Revenue Bonds, Series 1996. These bonds were issued by the Board to provide funds, together with $5,000,000, to retire 95% of the 1996 Series and to pay for all bond issuance costs. The September 1, 2005 and 2006 principal installments were not subject to early call and consequently paid at their respective maturity dates. The 1996 bonds were issued to acquire an existing water and sewer facility, as well as for capital improvements to the existing system. The aggregate difference in debt service between the Series 1996 ($40,585,193) and Series 2005 ($39,619,193) is $966,000. The net economic gain, which included shortening the term of the bonds by four years and lowering average annual debt service by $242,000, was $2,944,661 and is amortized over the life of the bonds. The unamortized balance of the deferred amount on the refunding at September 30, 2014 is $1,344,917 and is reflected as a deferred outflow of resources on the Statement of Net Position. Pledge of Revenues — The revenue bonds are collateralized, for the remaining term of the bonds, by a pledge of all net revenues derived from the operation of the system, certain surcharges, and special assessments. Annual principal and interest payments of $2,405,650 represent approximately seventeen percent of net revenues of $13,924,642 of the utility system. The total principal and interest remaining to be paid on the bonds is $19,235,100. Rate Covenant — Net revenues shall be sufficient to pay 100% of reserve and 120% of current year principal and interest requirements. Bonds Issued - At September 30, 2014, the revenue bonds consisted of the following: Description Water and Sewer Revenue Bonds, Series 2005 Outstanding at Interest Rates September 30, and Date Maturity Issue 2014 3-5% 3/1 and 9/1 2022 $ 27,675,000 $ 15,875,000 Outstanding In -Substance Defeased Debt - The proceeds from the refunding were invested in Federal Securities and placed in an escrow account with Bank of New York/Mellon. All of the defeased bonds ($31,680,000) were called on September 1, 2006 at 102% of the outstanding principal amount. 273 Indian River County, Florida Board of County Commissioners Notes To Financial Statements Year Ended September 30, 2014 NOTE 11— LONG-TERM LIABILITIES - Continued B. Proprietary Funds Long Term Debt - Continued Water and Sewer Revenue Refunding Bonds, Series 2005 - Continued Optional Redemption - The Series 2005 bonds maturing after September 1, 2015, are subject to redemption by the Board on or after September 1, 2015, in whole or in part, at par, plus accrued interest to date of redemption. Water and Sewer Revenue Refunding Bonds, Series 2009 Purpose - The Series 2009 bonds were issued to refund and redeem on September 11, 2009, $28,270,000 of the Board's outstanding Water and Sewer Revenue Bonds, Series 1993A. The refunding excluded debt service payments due September 1, 2010 and 2011. The aggregate difference in debt service between the Series 1993A ($80,434,415) and Series 2009 ($78,755,772) is $1,678,643. The net economic gain, which lowered average annual debt service by $126,000, was $1,368,427 and is amortized over the life of the bonds. The unamortized balance of the deferred amount on the refunding at September 30, 2014 is $900,881 and is reflected as a deferred outflow of resources on the Statement of Net Position. Pledge of Revenues — The revenue bonds are collateralized, for the remaining term of the bonds, by a pledge of all net revenues derived from the operation of the system, certain surcharges, and special assessments. The current principal and interest payments of $2,881,800 represent approximately twenty one percent of net revenues of $13,924,642 of the utility system. The total principal and interest remaining to be paid on the bonds is $27,333,500. Rate Covenant — Net revenues shall be sufficient to pay 100% of reserve and 120% of current year principal and interest requirements. Bonds Issued - At September 30, 2014, the revenue bonds consisted of the following: Outstanding at Interest Rates September 30, Description and Date Maturity Issue 2014 Water and Sewer 4-5% Revenue Bonds, 3/1 and 9/1 2024 $ 26,370,000 $ 21,340,000 Series 2009 274 Indian River County, Florida Board of County Commissioners Notes To Financial Statements Year Ended September 30, 2014 NOTE 11 - LONG-TERM LIABILITIES - Continued B. Proprietary Funds Long Term Debt — Continued Water and Sewer Revenue Refunding Bonds. Series 2009 - Continued Outstanding In -Substance Defeased Debt - The proceeds from the refunding were invested in Federal Securities and placed in an escrow account with Bank of New York/Mellon. All of the defeased bonds ($28,270,000) were called on September 1, 2009 at 101% of the outstanding principal amount. Optional Redemption - The Series 2009 bonds maturing on or prior to September 1, 2019, are not subject to redemption prior to their respective dates of maturity. The Series 2009 bonds stated to mature after September 1, 2019, are subject to redemption at the option of the Board in whole or, from time to time, in part on September 1, 2019, at the redemption price of the principal amount to be redeemed, plus accrued interest to the date of redemption. 275 Indian River County, Florida Board of County Commissioners Notes To Financial Statements Year Ended September 30, 2014 NOTE 12 - PROVISION FOR CLOSURE COSTS Current regulations of the U.S. Environmental Protection Agency (EPA) and the Florida Department of Environmental Protection (FDEP) require the Solid Waste Disposal District (SWDD) to place a final cover on closed landfill areas, and to maintain those areas for up to thirty years after closure. The SWDD annually obtains updated and revised estimates of total future closure and post -closure costs from its consulting engineers. The SWDD recognizes the expenses associated with the final closure and post -closure maintenance of the landfill areas over the active life of those areas. The provision for closure costs reported in the financial statements as operating expense represents the portion of these estimated future outlays which are allocable to the current year based on the amount of capacity used. The total unrecognized closure and post -closure costs are approximately $3.1 million. These costs will be recognized in future periods as the remaining capacity is filled. The Board's policy is to fund 100% of the current year's allocation (based upon the consulting engineers' report) of both closure and post - closure care. Required closure and post -closure sub -accounts: Capacity Estimated Used Closing Amount Closure Costs Class I - Segments I and II 61% 2026 $ 7,401,947 Construction and Demolition - Cell I 90% 2026 1,154,866 Post -closure Costs Class I - Segments 1 and II N/A N/A 2,763,435 Construction and Demolition - Cell I N/A N/A 189,488 Total account balance at 9/30/14 $ 11,509,736 1 1 1 1 1 1 All amounts recognized are based on what it would cost to perform all closure and post -closure functions in current dollars. Actual costs may be different due to inflation, deflation, changes in technology, or changes in laws and regulations. The SWDD is required by FDEP to annually show proof of ability to finance closure and post -closure costs. The SWDD is making annual deposits to a closure3 and post -closure costs account to provide for the financing of future closure -related expenses. At September 30, 2014, $11,448,484 was on deposit at the Florida Local Government Investment Trust and $61,252 was on deposit in the Board's Operating account. A summary of changes in the landfill closure liability account is as follows: Balance Balance 11 10/1/2013 Deposits Withdrawals 09/30/14 Closure and long-term care costs $ 11,011,736 $ 498,000 $ - $ 11,509,736 3 Of the $11,509,736 liability for closure and long-term care costs, management estimates that no funds 3 will be due and payable within one year. 276 Indian River County, Florida Board of County Commissioners Notes To Financial Statements Year Ended September 30, 2014 NOTE 13 — POLLUTION REMEDIATION In accordance with GASB Statement 49, Accounting and Financial Reporting for Pollution Remediation Obligations, a consultant evaluated four sites to assess pollution remediation liabilities. The consultant calculated for each site an expected value (EV) estimate for pollution remediation based on three plausible mitigation scenarios. An obligating event occurred at each of the following four sites requiring the Board (using the consultant's services) to attempt to accrue a liability for pollution remediation. The liability totaled $2,683,300 at September 30, 2014 for all four sites. The pollution remediation obligation is an estimate and subject to changes resulting from price increases and reductions, technology, and changes in applicable laws or regulations. There are no estimated recoveries that would reduce the liability. Governmental Funds: 1. South Gifford Road closed landfill — The nature of the pollution remediation obligation is chlorinated solvent contamination. The consultant will conduct monitoring, bioremediation and reporting with the Florida Department of Environmental Protection (FDEP). The amount of the estimated year end liability is $2,640,000 and will be paid from the Optional Sales Tax Fund. 2. Old Administration Building — The nature of the pollution remediation obligation is closed underground storage tank contamination. The consultant will conduct monitoring and reporting with the FDEP. The amount of the estimated year end liability is $26,800 and will be paid from the General Fund. 3. Cattle dip site — The nature of the pollution remediation obligation is arsenic contamination. The consultant will conduct monitoring and assessment. The amount of the estimated year end liability is $5,000 and will be paid from the Impact Fees Fund. Total governmental funds liability: $2,671,800 Proprietary Funds: 4. North County Reverse Osmosis plant — The nature of the pollution remediation obligation is groundwater inorganic contamination. The consultant will conduct monitoring and assessment. The amount of the estimated year end liability is $11,500 and will be paid from the County Utilities Fund. Total proprietary funds liability: $11.500 277 Indian River County, Florida Board of County Commissioners Notes To Financial Statements Year Ended September 30, 2014 NOTE 14 — PENSION PLANS Florida Retirement System Plan Description: The Board's employees participate in the Florida Retirement System (FRS), a cost- sharing, multiple -employer public employee retirement system, administered by the Florida Department of Management Services. Effective July 1, 2011, the FRS became a contributory plan for all members, except DROP participants, whereby members contribute 3% and employers pay a rate based upon each member's employment class. Employer rates effective as of July 1, 2014 were as follows: regular class 7.37%, senior class 21.14%, special risk 19.82%, and elected official class 43.24%. Employees elect participation in either the defined benefit plan (Pension Plan) or the defined contribution plan (Investment Plan). If the employee enrolled in the FRS prior to July 1, 2011, normal retirement is age 62 with 6 years of service or 30 years of service, regardless of age. If the employee enrolled in the FRS on or after July 1, 2011, normal retirement is age 65 with 8 years of service or 33 years of service, regardless of age. Under the Pension Plan, early retirement is available before reaching normal retirement age and will be subject to an early-retirement reduction of 5% for each year your age at retirement is under your normal retirement age. For those employees who elect participation in the Investment Plan rather than the Pension Plan, vesting occurs after one year of service. Participants have access to the full value of their vested account balance when they leave FRS employment, regardless of age. These participants receive a defined contribution for self-direction in an investment product with a third party administrator selected by the State Board of Administration. Retirement benefits are determined by age, years of service, the average of the highest 5 or 8 fiscal years of pay, membership class and the payment option selected at retirement. In addition to the above benefits, the FRS administers a Deferred Retirement Option Program (DROP). This program allows eligible employees to defer receipt of monthly retirement benefit payments while continuing employment with a FRS employer for a period not to exceed five years after electing to participate. Deferred monthly benefits are held in the FRS Trust Fund and accrue interest. Employer contributions to the FRS for the fiscal years ended September 30, 2012, 2013 and 2014, were equal to 7.7%, 9.1%, and 11.5% of the annual covered payroll. Employer contributions to the FRS for the fiscal years ended September 30, 2012, 2013, and 2014, were $2,905,921, $3,397,021 and $4,308,039 respectively. Employee contributions for the fiscal years ended September 30, 2012, 2013, and 2014 were $956,266, $919,672, and $930,338. Both employer and employee contributions were equal to 100% of the required contribution for each year. Florida Statutes Chapter 121, as may be amended from time to time by the state legislature, determines contribution rates for the various membership classes of the FRS. The FRS issues a publicly available financial report that includes financial statements, ten-year historical trend information and other required supplementary information. That report may be obtained by writing to the Florida Department of Management Services, Division of Retirement, Attention: Research and Education Section, P.O. Box 9000, Tallahassee, Florida 32315-9000, or from the website at www.dms.myflorida.com. The funding policy is described in detail in the Florida Retirement System note in the County -wide financial statements. 278 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 Indian River County, Florida Board of County Commissioners Notes To Financial Statements Year Ended September 30, 2014 NOTE 15 — OTHER POSTEMPLOYMENT BENEFITS PLAN (OPEB) A. Plan Description On September 23, 2008, the Board of County Commissioners approved resolution number 2008-163, establishing an irrevocable trust (OPEB Trust) to separately identify assets accumulated to pay OPEB benefits for eligible retirees. The OPEB Trust includes the Board of County Commissioners and the five constitutional officers (Clerk of the Circuit Court and Comptroller, Property Appraiser, Sheriff, Supervisor of Elections, and Tax Collector). The resolution also established the Board of County Commissioners as trustees of the OPEB Trust and the authority for the trustees to amend the benefit provisions. The OPEB Trust is a single -employer defined benefit plan (OPEB Plan). The OPEB plan subsidizes (see the chart below) the cost of health care for employees hired prior to February 1, 2006 and their eligible dependents according to the provisions of the substantive plan (the plan as understood by the employer and plan members). Employees hired on or after February 1, 2006, will not be eligible for any subsidy, regardless of the years of service or Medicare eligibility. Active participants as well as retirees are subject to the same benefits and rules. Retired employees are permitted to remain covered under the Board's medical and life insurance plans as long as they pay a premium applicable to the coverage elected. This conforms to the minimum required of Florida governmental employers per Florida Statute 112.0801. The retiree has the option to continue with the Board group health plan or elect Medicare Advantage Plan. The implicit rate subsidy applies to health and life insurance coverage since the premiums charged are based upon a blending of younger active employees and older retired employees. Health insurance premiums, effective October 1, 2013 range from $400 for Medicare participants to $715 for family coverage. Life insurance is available to retirees at a flat rate of $.20 per $1000 of coverage (to a maximum of $20,000 until the age of 70). After 70, the maximum amount of life insurance is $10,000. The Board subsidizes the cost of the health premiums for each retiree based upon their years of service and employment date (as mentioned above); a 2% discount is given for each year of service based upon the following table: Retirement Date Years of Service Under Age 65 Medicare Eligible Before 01/01/04 N/A No subsidy 60% subsidy 01/01/04 - 10/01/04 Less than 15 years No subsidy 60% subsidy 01/01/04 - 10/01/04 15 or more years 2%/yr-max 40% 20% in addition to yrs of service -max 60% subsidy 10/01/04 - 01/31/09 Less than 15 years No subsidy 20% subsidy 10/01/04 - 01/31/09 15 or more years 2%/yr-max 40% 20% in addition to yrs of service -max 60% subsidy 02/01/09 and after Less than 15 years No subsidy No subsidy 02/01/09 and after 15 or more years 2%/yr-max 40% No subsidy 279 Indian River County, Florida Board of County Commissioners Notes To Financial Statements Year Ended September 30, 2014 NOTE 15 — OTHER POSTEMPLOYMENT BENEFITS PLAN (OPEB) — Continued A. Plan Description — Continued The OPEB Trust financial statements are reported using the accrual basis of accounting and are included in the Indian River County Comprehensive Annual Financial Report (CAFR). Questions regarding the OPEB plan may be directed to the Finance Director. At October 1, 2013, the date of the latest actuarial valuation, plan participation consisted of: Active participants 1,382 Retired participants 429 Total participants 1,811 There are two classes of participants at October 1, 2013: Regular and senior management 1,141 Special risk 670 Total participants 1,811 The average employer's contribution was $2,051 per employee, approximately 4.6% of current payroll. Financial statements for the OPEB Trust are included in this report and can be found on pages 244-245. A separate, stand-alone financial report is not issued by the Board; however, the OPEB Trust investments can be found in Note 2D and the Schedule of Funding Progress can be found on page 101. B. Funding Policy The Board of County Commissioners, in concert with the OPEB Board of Trustees, has the authority to establish and amend the funding policy of the OPEB Plan. The OPEB Trust is advance funded by the Board. For the year ended September 30, 2014, the County contributed $3.43 million to the qualifying OPEB Trust. Plan members receiving benefits contributed $1.72 million, or approximately 50 percent of the total premiums. It is the Board's policy to base future contributions on the annual required contribution (ARC) in subsequent annual actuarial reports. The contributions are paid by the fund(s) by which the participant is employed. Custodial and individual fund administrative fees are paid from the portfolio dividend and interest income. C. Annual OPEB Cost and Net OPEB Obligation The employer's contribution (i.e. annual cost or expense) to the Board's OPEB Trust is based on the ARC calculation. The ARC is an amount actuarially determined in accordance with the parameters of GASB Statement No. 45. The ARC represents a level of funding that, if paid on an ongoing basis, is projected to cover the normal cost each year and amortize any unfunded actuarial liability over a period not to exceed 20 years. The following table shows the components of the Board's annual cost for the current and two preceding years, the amount actually contributed, and the changes in the net obligation. 280 Indian River County, Florida Board of County Commissioners Notes To Financial Statements Year Ended September 30, 2014 NOTE 15 — OTHER POSTEMPLOYMENT BENEFITS PLAN (OPEB) - Continued C. Annual OPEB Cost and Net OPEB Obligation - Continued FY 2013/2014 Annual Required Contribution $ 2,835,072 $ Interest on Net OPEB Obligation (18,036) Adjustment to Annual Required Contribution 24,230 Annual OPEB Cost (expense) 2,841,266 Contributions (net of adjustments)* (3,336,027) Change in Net OPEB Obligation (494,761) Net OPEB Obligation — beginning of year (300,606) Net OPEB Obligation — end of year $ (795,367) $ Percentage of Annual OPEB Cost Contributed 117.41 % *Retiree adjustments are comprised of the actual FY 2012/2013 FY 2011/2012 2,965,251 $ (20,909) 26,830 2,971,172 (2,950,097) 2,828,452 (12,323) 14,075 2,830,204 (2,962,301) 21,075 (132,097) (321,681) (189,584) (300,606) $ (321,681) 99.29 % 104.67% amount withdrawn from the Trust plus premiums collected and less claims paid. For fiscal year 2014, these adjustments amounted to (590,852). For fiscal years 2013 and 2012, these adjustments totaled ($15,154) and $13,640 respectfully. D. Funded Status and Funding Progress The Schedule of Funding Progress and Schedule of Employer Contributions, presented as required supplementary information immediately following the County Notes to the Financial Statements (on page 101), presents multi-year trend regarding liabilities, funding, and payroll. The data also reflects whether the actuarial value of the plan assets is increasing or decreasing over time relative to the actuarial accrued liabilities for benefits. This information includes the current and past three actuarial valuations and seven years of funding data. Actuarial valuations of an ongoing plan involve estimates of the value of reported amounts and assumptions about the probability of occurrence of events into the future. Examples include assumptions about future employment, mortality, and the healthcare cost trend. Amounts determined regarding the funded status of the plan and the annual required contributions of the employer are subject to continual revision as actual results are compared with past expectations and new estimates are made about the future. E. Actuarial Methods and Assumptions Projections of benefits for financial reporting purposes are based on the benefits provided under terms of the substantive plan (the plan as understood by the employer and the plan members) in effect at the time of each valuation and on the pattern of sharing of costs between the employer and plan members to that point. The projection of benefits for financial reporting purposes does not explicitly incorporate the potential effects of legal or contractual funding limitations on the pattern of cost sharing between the employer and plan members in the future. Actuarial calculations reflect a long-term perspective. Consistent with that perspective, actuarial methods and assumptions used include techniques that are designed to reduce the effects of short-term volatility in actuarial accrued liabilities and the actuarial value of assets. 281 Indian River County, Florida Board of County Commissioners Notes To Financial Statements Year Ended September 30, 2014 NOTE 15 — OTHER POSTEMPLOYMENT BENEFITS PLAN (OPEB) - Continued E. Actuarial Methods and Assumptions - Continued The actuarial methods are: Actuarial cost method Amortization method Amortization period (closed) Asset valuation method The actuarial assumptions are: Investment rate of return Projected annual salaries increase Healthcare cost trend rate Inflation rate NOTE 16 - OPERATING LEASES Entry age normal cost method Level percent of payroll projected to grow 4% per year 14 years Market Value 6.0% 4.0%-9.47% 8.5% 3% (net administrative expenses) (dependent on years of service and age) (decreasing '/2% each year & thereafter to the ultimate value of 5.28%) The Board has entered into noncancelable operating leases, both as lessor and lessee. Lease terms vary from 1 to 99 years. Lease revenues totaled $620,669 and lease expenditures totaled $81,163 for the year ended September 30, 2014. The Board also leases other equipment and office facilities as both lessor and lessee on a month-to-month basis. C. Future Minimum Lease Receipts Year Amount 2015 2016 2017 2018 2019 2020-2024 2025-2029 2030-2034 2035-2038 Total future minimum receipts: $ 626,153 622,429 613,113 602,889 621,023 2,805,324 1,037,328 450,507 108,800 $ 7,487,566 The property being leased is reported in the financial statements of County and has a cost of $29,219,029, and a carrying value of $19,972,847. Current year depreciation on property being leased was $492,950. 282 Indian River County, Florida Board of County Commissioners Notes To Financial Statements Year Ended September 30, 2014 NOTE 16 - OPERATING LEASES - Continued B. Future Minimum Lease Payments The following is a schedule, by years, of minimum future rentals to be paid by the Board for various noncancelable operating leases as of September 30, 2014: Year Amount 2015 $ 83,371 2016 84,809 2017 43,696 2018 43,696 2019 43,696 2020-2024 7,500 2025-2029 7,500 2030-2034 7,500 2035-2039 5,700 2040-2044 4,500 2045-2049 3,900 2050-2054 3,000 2055-2059 1,800 2060-2064 1,500 2065-2069 1,500 2070-2074 1,500 2075-2076 600 Total future minimum lease payments: $ 345,768 283 Indian River County, Florida Board of County Commissioners Notes To Financial Statements Year Ended September 30, 2014 NOTE 17 - FUND BALANCE GASB Statement 54 — Fund Balance Reporting and Governmental Funds Type Definitions requires the fund balance for governmental funds to be reported in classifications that comprise a hierarchy based primarily on the extent to which the government is bound to honor constraints on the specific purposes for which amounts in those funds can be spent. A. Categories There are five categories of fund balance for governmental funds under Statement 54: Nonspendable — Amounts that cannot be spent because they are not in spendable form or are legally or contractually required to remain intact. Restricted — Use of these resources is based on the constraints imposed externally by creditors, grantors, contributors, or laws and regulations of other governments; or imposed by law through constitutional provisions or enabling legislation. Committed — Amounts whose use is constrained by the approval of a County ordinance by the Board of County Commissioners. This category also includes existing resources on hand to satisfy the obligations that arise from contractual obligations entered into by the Board of County Commissioners. Assigned — The Board of County Commissioners is the governing body authorized to assign fund balance amounts to be used for specific purposes. This assignment is done through the budget approval and amendment process. Amounts appropriated to eliminate a budgetary deficit in a subsequent year are reported in this category as well. Unassigned — Residual amounts in the general fund that do not meet any of the other fund balance classifications. B. Fund Balance Policy On September 21, 2010, the Board approved a Fund Balance and Reserve Policy that set forth the following reserves of fund balance in the General, Transportation, and Emergency Services District Funds: Emergency/Disaster Relief Reserve — A balance of no less than 5% of budgeted operating expenditures for the current fiscal year will be reserved only for the purpose of responding to natural and man-made disasters. Disasters include hurricanes, tropical storms, floods, wildfires, or terrorist activities. These funds can only be used to respond and provide relief after such a disaster. Funds will be replenished over a five-year period after the completion of the recovery from the disaster. 284 Indian River County, Florida Board of County Commissioners Notes To Financial Statements Year Ended September 30, 2014 NOTE 17 - FUND BALANCE — Continued B. Fund Balance Policy - Continued Budget Stabilization Reserve — A balance of no less than 5% of budgeted operating expenditures for the current fiscal year will be reserved only for the purpose of revenue declines or unfunded mandates from the state and federal governments. Funds utilized due to revenue declines will be replenished over a five-year period. Funds utilized for unfunded mandates or unanticipated expenditures cannot be used for more than a three-year period and must be replenished within five -years after the three-year period. At September 30, 2014, reserve amounts for those funds were: Disaster Relief Budget Stabilization Total General Fund $ 5,100,000 $ 5,100,000 $ 10,200,000 Transportation Fund 750,000 750,000 1,500,000 Emergency Services District Fund 1,400,000 1,400,000 2,800,000 Total $ 7,250,000 $ 7,250,000 $ 14,500,000 The General Fund reserves are included in the unassigned fund balance on the balance sheet. The Transportation Fund reserves are included in the assigned fund balance and the Emergency Services District Fund reserves are included in the restricted fund balance on the balance sheet. The Emergency/Disaster Relief and Budget Stabilization Reserve amounts may only be revised by the Board of County Commissioners. Minimum Fund Balance - The approved fund balance policy dictates the Board's attempt to maintain a minimum fund balance in the General, Transportation, and Emergency Services District funds of 20% of budgeted annual operating expenditures. The minimum fund balance level may be revised by the County Administrator or his designee. C. Spending Hierarchy For all governmental funds, when restricted, committed, assigned, and unassigned fund balances are combined in a fund, qualified expenditures are paid first from restricted or committed fund balance, as appropriate, then assigned and finally unassigned fund balances. 285 Indian River County, Florida Board of County Commissioners Notes To Financial Statements Year Ended September 30, 2014 NOTE 18 - FUND BALANCE DEFICIT The following funds had a deficit in fund balance at September 30, 2014: Fund Deficit Nonmajor Governmental Funds: Metropolitan Planning Organization Fund $ 155,018 Community Development Block Grant NSP3 Grant Fund 39,369 Total Deficit $ 194,387 The deficits for these two funds will be eliminated by grant proceeds in fiscal year 2015. 1 Indian River County, Florida I Board of County Commissioners Notes To Financial Statements Year Ended September 30, 2014 1 NOTE 19 - RISK MANAGEMENT 1 General Liability, Property, Worker's Compensation and Medical The Board is exposed to various risks of loss related to torts, theft of, damage to and destruction of I assets, errors or omissions, injuries to employees, and natural disasters. The Board established a Self Insurance Fund (an internal service fund) to account for and finance its uninsured risk of loss. Under this program, the Self Insurance Fund provides coverage as follows: I10/01/08 to 05/01/11 to 10/01/13 to 4/30/2011 9/30/2013 9/30/2014 IWorker's Compensation $ 350,000 $ 350,000 $ 500,000 General Liability 250,000 200,000 200,000 1 Auto Liability 250,000 200,000 200,000 Property Damage 250,000 200,000 200,000 Error or Omissions 250,000 200,000 200,000 I Annual Aggregate 2,000,000 2,000,000 2,000,000 Liquor Liability 1,000,000 1,000,000 1,000,000 1 The Board purchases excess insurance to cover claims in excess of the liability coverage listed above. There is a 5% deductible per location for property damages arising due to a hurricane under the I reinsurance policy. All departments of the Board participate in the program. Payments are made by various funds to the Self Insurance Fund based on past experience and actual estimates of the amounts needed to pay current year claims. The Board has received three workers compensation reimbursements I totaling $125,213 in fiscal year 2014. The Board received two workers compensation reimbursements totaling $108,123 in fiscal year 2013 and one in fiscal year 2012 totaling $134,020. I The Board is also self-insured for medical claims covering employees and their eligible dependents. As required by Section 112.081, Florida Statutes, retirees and their eligible dependents are provided the same health care coverage as is offered to active employees; however, the retirees are responsible for I payment of the premiums. Medical claims are paid from premiums contributed by employees, retirees, and by the Board. Premiums and contributions are determined by projected claims based on historical and actuarial experience. The self-insurance medical plan assumes all risk for claims, other than I worker's compensation, up to $250,000 per occurrence. The Board has purchased a reinsurance policy to cover claims in excess of these limits. There were six medical claim reimbursements in excess of the $250,000 limit for fiscal year 2014 totaling $335,641. In fiscal year 2013, there were six totaling I $285,689 and in fiscal year 2012, there were none. 1 1 1 287 Indian River County, Florida Board of County Commissioners Notes To Financial Statements Year Ended September 30, 2014 NOTE 19 - RISK MANAGEMENT - Continued General Liability, Property, Worker's Compensation and Medical — Continued The claims liability of $8,226,545 reported at September 30, 2014, is based on the requirements of generally accepted governmental accounting standards, which require that a liability for claims be reported if information prior to the issuance of the financial statements, and the amount of the loss, can be reasonably estimated. Estimates for claims incurred but not reported are actuarially determined and recorded. Based on the actuary's report, $3,181,891 will be liquidated over the next twelve months. Changes in the fund's claims liability amount during the current and prior three fiscal years are as follows: Balance at Claims Balance Fiscal Year and Changes Claims at Fiscal Beginning in Estimates Payments Year End 2010-2011 $ 7,899,000 $ 12,901,425 $ (12,923,425) $ 7,877,000 2011-2012 7,877,000 13,967,831 (13,770,831) 8,074,000 2012-2013 8,074,000 14,396,726 (14,396,726) 8,074,000 2013-2014 8,074,000 16,860,869 (16,708,324) 8,226,545 Included in the charges to other funds is an amount to fund future catastrophic losses not actuarially determined; and at September 30, 2014, unrestricted net position of $23,730,587 has been designated for this purpose. The Board has elected to accrue the larger of the discounted liability or undiscounted liability. At September 30, 2014, the undiscounted liability was the greater of the two amounts. The discount rate used in the calculation was 2.5 percent. NOTE 20 - COMMITMENTS AND CONTINGENCIES A. Litigation Various suits and claims are currently pending against the Board. It is impossible for the Board to accurately quantify the exposure involved given the jury's latitude in assessing compensatory and punitive damages, and the court's latitude in awarding attorney's fees. The Board intends to vigorously defend against these lawsuits and believes it has a good chance of prevailing on their merits. The Board is contingently liable with respect to lawsuits and other claims incidental to the ordinary course of its operations. In the opinion of management and based on the advice of legal counsel, the ultimate disposition of lawsuits will not have a material adverse effect on the financial position of the Board. 288 Indian River County, Florida Board of County Commissioners Notes To Financial Statements Year Ended September 30, 2014 NOTE 20 - COMMITMENTS AND CONTINGENCIES - Continued B. Contracts and Other Commitments The Board has various contracts and commitments outstanding at September 30, 2014. In the General Fund, contracts are for janitorial services, beach park landscape and custodial maintenance, legislative consulting services and external auditing services. In the Special Revenue Funds, contracts are for the Sector 3 Dune Repair -Post Sandy, Oslo Road Widening from 58th Avenue to 43rd Avenue (Phase III), 66th Avenue Roadway Improvements, Old Dixie Highway resurfacing, as well as a variety of other road paving and drainage projects. In the Capital Projects Fund, contracts are for the South County Regional Park Intergenerational Recreation Facility, PC South Algal Turf Scrubber Nutrient Recovery System, 12th Street and 27th Avenue intersection improvements and several sidewalk and road improvement projects throughout the County. In the Enterprise Funds, contracts are for the Reverse Osmosis Lime Slurry Injection Project, Golf Course Dunes Irrigation project, South County Brine Disposal project and various other water and sewer projects. A summary of these projects at September 30, 2014, is as follows: General Special Revenue Capital Projects Enterprise Internal Service Total C. Grants Total Contract Price $ 1,022,490 $ 42,450,585 7,055,871 12,779,653 30,000 63,338,599 $ Total Paid as of September 30, 2014 (414,497) $ (27,854,250) (5,965,418) (8,438,093) (42,672,258) $ Remaining Balance at September 30, 2014 607,993 14,596,335 1,090,453 4,341,560 30,000 20,666,341 Amountsreceived or receivable from grantor agencies are subject to audit and adjustment by grantor agencies. If any expenditures are disallowed as a result of these audits, the claims for reimbursement to the grantor agency would become a liability of the Board. In the opinion of management, any such adjustments would not be significant. NOTE 21 - SUBSEQUENT EVENTS On February 17, 2015, the Board approved appropriating $2.7 million from General Fund reserves to fund legal action against the All Aboard Florida railway project. Funding is anticipated to be $0.5 million in fiscal year 2015 and $1.1 million in fiscal years 2016 and 2017. 289 Rehmann Rehmann Robson 5070 North Highway A1A Suite 250 Vero Beach, FL 32963 Ph 772.234.8484 Fx 772.234 8488 rehmann.com INDEPENDENT AUDITORS' REPORT ON INTERNAL CONTROL OVER FINANCIAL REPORTING AND ON COMPLIANCE AND OTHER MATTERS BASED ON AN AUDIT OF FINANCIAL STATEMENTS PERFORMED IN ACCORDANCE WITH GOVERNMENT AUDITING STANDARDS March 4, 2015 The Honorable Board of County Commissioners Indian River County, Florida We have audited, in accordance with the auditing standards generally accepted in the United States of America and the standards applicable to financial statements contained in Government Auditing Standards issued by the Comptroller General of the United States, the fund financial statements of the major fund and the aggregate remaining fund information of the Indian River County, Florida Board of County of Commissioners (the "Board"), as of and for the year ended September 30, 2014, which collectively comprise the Board's fund financial statements and have issued our report thereon dated March 4, 2015. Internal Control over Financial Reporting In planning and performing our audit of the financial statements, we considered the Board's internal control over financial reporting (internal control) to determine the audit procedures that are appropriate in the circumstances for the purpose of expressing our opinions on the financial statements, but not for the purpose of expressing an opinion on the effectiveness of the Board's internal control. Accordingly, we do not express an opinion on the effectiveness of the Board's internal control. A deficiency in internal control exists when the design or operation of a control does not allow management or employees, in the normal course of performing their assigned functions, to prevent, or detect and correct misstatements on a timely basis. A material weakness is a deficiency, or a combination of deficiencies, in internal control such that there is a reasonable possibility that a material misstatement of the entity's financial statements will not be prevented, or detected and corrected on a timely basis. A significant deficiency is a deficiency, or a combination of deficiencies, in internal control that is less severe than a material weakness, yet important enough to merit attention by those charged with governance. Our consideration of internal control was for the limited purpose described in the first paragraph of this section and was not designed to identify all deficiencies in internal control that might be material weaknesses or significant deficiencies. Given these limitations, during our audit we did not identify any deficiencies in internal control that we consider to be material weaknesses. However, material weaknesses may exist that have not been identified. Compliance and Other Matters As part of obtaining reasonable assurance about whether the Board's financial statements are free from material misstatement, we performed tests of its compliance with certain provisions of laws, regulations, contracts, and grant agreements, noncompliance with which could have a direct and Rehmann is an independent member of Nexia International CPAs & Consultants Wealth Advisors Corporate Investigators 290 xmota I NT LRNATI()NAI The Honorable Board of County Commissioners Indian River County, Florida March 4, 2015 Page 2 material effect on the determination of financial statement amounts. However, providing an opinion on compliance with those provisions was not an objective of our audit, and accordingly, we do not express such an opinion. The results of our tests disclosed no instances of noncompliance or other matters that are required to be reported under Government Auditing Standards. Purpose of this Report The purpose of this report is solely to describe the scope of our testing of internal control and compliance and the results of that testing, and not to provide an opinion on the effectiveness of the Board's internal control or on compliance. This report is an integral part of an audit performed in accordance with Government Auditing Standards in considering the entity's internal control and compliance. Accordingly, this communication is not suitable for any other purpose. L LC 291 Rehmann MANAGEMENT LETTER March 4, 2015 The Honorable Board of County Commissioners Indian River County, Florida Report on the Financial Statements Rehmann Robson 5070 North Highway A1A Suite 250 Vero Beach, FL 32963 Ph 772.234.8484 Fx 772.234 8488 rehmann.com We have audited the financial statements of each major fund and the aggregate remaining fund information of the Indian River County, Florida Board of County Commissioners (the "Board"), as of and for the year ended September 30, 2014 and have issued our report thereon dated March 4, 2015. Auditor's Responsibility We conducted our audit in accordance with auditing standards generally accepted in the United States of America; the standards applicable to financial audits contained in Government Auditing Standards, issued by the Comptroller General of the United States; OMB Circular A-133, Audits of States, Local Governments, and Non -Profit Organizations; and Chapter 10.550, Rules of the Auditor General. Other Reports and Schedule We have issued our Independent Auditors' Report on Internal Control over Financial Reporting and on Compliance and Other Matters Based on an Audit of the Financial Statements Performed in Accordance with Government Auditing Standards; Independent Auditor's Report on Compliance for Each Major Federal Program and State Project and Report on Internal Control over Compliance; Schedule of Findings and Questioned Costs; and Independent Accountants' Report on an examination conducted in accordance with AICPA Professional Standards, Section 601, regarding compliance requirements in accordance with Chapter 10.550, Rules of the Auditor General. Disclosures in those reports, which are dated March 4, 2015, should be considered in conjunction with this management letter. Prior Audit Findings Section 10.554(1)(i)1., Rules of the Auditor General, requires that we determine whether or not corrective actions have been taken to address findings and recommendations made in the preceding annual financial audit report. There were no findings or recommendations in the preceding annual financial audit report. Official Title and Legal Authority Section 10.554(1)(i)4., Rules of the Auditor General, requires that the name or official title and legal authority for the primary government and each component unit of the reporting entity be disclosed in this management letter, unless disclosed in the notes to the financial statements. This information is disclosed in the notes to the financial statements. Rehmann is an independent member of Nexia International. CPAs & Consultants Wealth Advisors Corporate Investigators 292 INTERN STI ON Al Other Matters Section 10.554(1)(1)2., Rules of the Auditor General, requires that we address in the management letter any recommendations to improve financial management. In connection with our audit, we did not have any such recommendations. Section 10.554(1)(i)3., Rules of the Auditor General, requires that we address noncompliance with provisions of contracts or grant agreements, or abuse, that have occurred, or are likely to have occurred, that have an effect on the financial statements that is less than material but which warrants the attention of those charged with governance. In connection with our audit, we did not have any such findings. Purpose of this Letter Our management letter is intended solely for the information and use of the Legislative Auditing Committee, members of the Florida Senate and the Florida House of Representatives, the Florida Auditor General, Federal and other granting agencies, and applicable management and is not intended to be and should not be used by anyone other than these specified parties. 44.0.44-1-4+'- LLC 293 Rehmann INDEPENDENT ACCOUNTANTS' REPORT March 4, 2015 The Honorable Board of County Commissioners Indian River County, Florida Rehmann Robson 5070 North Highway A1A Suite 250 Vero Beach, FL 32963 Ph 772.234 8484 Fx 772.234 8488 rehmann.com We have examined the compliance of Indian River County, Florida Board of County Commissioners (the "Board") with Section 218.415, Florida Statutes, during the year ended September 30, 2014. Management is responsible for compliance with those requirements. Our responsibility is to express an opinion on the Board's compliance based on our examination. Our examination was conducted in accordance with attestation standards established by the American Institute of Certified Public Accountants and, accordingly, includes examining, on a test basis, evidence about the Board's compliance with those requirements and performing such other procedures as we considered necessary in the circumstances. We believe that our examination provides a reasonable basis for our opinion. Our examination does not provide a legal determination on the Board's compliance with specified requirements. In our opinion, the Board complied, in all material respects, with the aforementioned requirements for the year ended September 30, 2014. This report is intended solely for the information and use of management, the Board of County Commissioners and the Florida Auditor General and is not intended to be and should not be used by anyone other than these specified parties. Rehmann Is an independent member of Nexia International. CPAs & Consultants Wealth Advisors Corporate Investigators 294 LLC IN TGR NATI ON AL CLERK OF THE CIRCUIT COURT AND COMPTROLLER .a�.:Y.u5:.1•.:�lbh_,e�✓'.:...T�..S$8d":-n:�^;r_Scs�¢I,. 295 R,ehmann INDEPENDENT AUDITORS' REPORT March 4, 2015 The Honorable Jeffrey R. Smith Clerk of the Circuit Court and Comptroller Indian River County, Florida Report on the Financial Statements Rehmann Robson 5070 North Highway A1A Suite 250 Vero Beach, FL 32963 Ph 772.234 8484 Fx 772.234 8488 rehmann.com We have audited the accompanying fund financial statements of each major fund and the aggregate remaining fund information of the Indian River County, Florida Clerk of Court (the "Clerk"), as of and for the year ended September 30, 2014, and the related notes to the financial statements, which collectively comprise the Clerk's fund 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. Independent Auditors' 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 of 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 auditors' 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 opinion. Rehmann is an independent member of Nexia International. CPAs & Consultants Wealth Advisors Corporate Investigators 296 I NT ER N AT105 A1. Opinion In our opinion, the financial statements referred to above present fairly, in all material respects, the financial position of the funds of the Clerk as of September 30, 2014, and the respective changes in financial position and the respective budgetary comparison for the general fund for the year then ended in accordance with accounting principles generally accepted in the United States of America. Reporting Entity As discussed in Note 1, the financial statements referred to above present only the Indian River County, Florida Clerk of Court and do not purport to, and do not, present fairly the financial position of Indian River County, Florida as of September 30, 2014, and the changes in its financial position for the year then ended, in conformity with accounting principles generally accepted in the United States of America. Other Reporting Required by Government Auditing Standards In accordance with Government Auditing Standards, we have also issued our report dated March 4, 2015 on our consideration of the Clerk'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 Clerk's internal control over financial reporting and compliance. 4,,,,,,ced....,„ LLC 297 I Indian River County, Florida Clerk of the Circuit Court and Comptroller Balance Sheet Governmental Funds September 30, 2014 Total Nonmajor Fund Governmental General Special Revenue Funds ASSETS Cash and cash equivalents $ 14,952 $ 2,027,585 $ 2,042,537 Accounts receivable 139,336 - 139,336 Prepaid items 43,478 11,916 55,394 Due from other governments 229,101 229,101 Total assets $ 426,867 $ 2,039,501 $ 2,466,368 LIABILITIES AND FUND BALANCES Liabilities: Accounts payable $ 12,163 $ $ 12,163 Due to other governments 352,056 352,056 Unearned revenues 62,648 62,648 Total liabilities 426,867 - 426,867 Fund Balances: Nonspendable: Prepaid items 43,478 11,916 55,394 Restricted for: Court -related costs and improvements 2,027,585 2,027,585 Unassigned (43,478) - (43,478) Total fund balances 2,039,501 2,039,501 Total liabilities fund balances $ 426,867 $ 2,039,501 $ 2,466,368 The accompanying notes are an integral part of the financial statements. 298 Indian River County, Florida Clerk of the Circuit Court and Comptroller Statement of Revenues, Expenditures, and Changes in Fund Balances Governmental Funds For the Year Ended September 30, 2014 Total Nonmajor Fund Governmental General Special Revenue Funds REVENUES Intergovernmental $ 294,764 $ - $ 294,764 Charges for services 4,220,116 371,545 4,591,661 Judgments, fines and forfeits 195,435 195,435 Interest 3,588 2,374 5,962 Total revenues 4,518,468 569,354 5,087,822 EXPENDITURES General government 1,776,738 535,640 2,312,378 Court related 3,592,917 219,646 3,812,563 Total expenditures 5,369,655 755,286 6,124,941 Excess of revenues over (under) expenditures (851,187) (185,932) (1,037,119) OTHER FINANCING SOURCES (USES) Transfers from Board of County Commissioners 902,281 902,281 Transfer to Board of County Commissioners (51,094) (51,094) Total other financing sources (uses) 851,187 - 851,187 Net change in fund balances Fund balances at beginning of year Fund balances at end of year (185,932) (185,932) 2,225,433 2,225,433 $ 2,039,501 $ 2,039,501 The accompanying notes are an integral part of the financial statements. 299 Indian River County, Florida Clerk of the Circuit Court and Comptroller Statement of Revenues, Expenditures, and Changes in Fund Balances - Budget and Actual General Fund For the Year Ended September 30, 2014 Budgeted Amount Original Final Actual Variance with Final Budget Positive (Negative) 1 1 1 1 1 REVENUES Intergovernmental $ 33,488 $ 152,048 $ 294,764 $ 142,716 Charges for services 4,357,299 4,352,074 4,220,116 (131,958) Interest - - 3,588 3,588 1 Total revenues 4,390,787 4,504,122 4,518,468 14,346 EXPENDITURES General government 1,835,587 1,812,661 1,776,738 35,923 Court related 3,457,481 3,593,742 3,592,917 825 Total expenditures 5,293,068 5,406,403 5,369,655 36,748 Excess of revenues over (under) expenditures (902,281) (902,281) (851,187) 51,094 1 1 1 OTHER FINANCING SOURCES (USES) Transfers from Board of County Commissioners 902,281 902,281 902,281 - Transfers to Board of County Commissioners - (51,094) (51,094) Total other financing sources (uses) 902,281 902,281 851,187 (51,094)1 Net change in fund balances Fund balances at beginning of year Fund balances at end of year $ $ The accompanying notes are an integral part of the financial statements. 300 1 1 1 1 Indian River County, Florida Clerk of the Circuit Court and Comptroller Statement of Fiduciary Net Position Agency Fund September 30, 2014 ASSETS Cash and cash equivalents $ 6,668,162 Total assets $ 6,668,162 LIABILITIES Due to other governments $ 746,346 Escrow deposits 5,921,816 Total liabilities $ 6,668,162 The accompanying notes are an integral part of the financial statements. 301 1 Indian River County, Florida Clerk of the Circuit Court and Comptroller Notes To Financial Statements Year Ended September 30, 2014 NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES The Clerk of the Circuit Court and Comptroller (Clerk) is a County agency and a local governmental entity pursuant to Article VIII, Section 1(d) of the Constitution of the State of Florida. For financial statement and reporting purposes, the Clerk does not meet the definition of a legally separate organization and is not considered to be a component unit. The Clerk is considered to be a part of the primary government of Indian River County. Court -related expenditures are funded through filing fees, service charges, court costs and fines assessed to parties using the court system. Under 2013-44, Laws of Florida, revenue collected by the Clerk is retained by the County and remitted to the Florida Department of Revenue based upon various formulas determined by Florida Clerks of Court Corporation. Non -court expenditures are funded by the Board of County Commission for both the finance and recording (board meeting recordings) departments. Additional non -court revenues include various fees assessed for the recording of documents, passports, marriage licenses and court reporter services. Both court and non -court operations are reported in these financial statements. The financial statements contained herein represent the financial transactions of the Clerk of the Circuit Court and Comptroller only. The format of the Clerk's statements has been prepared in accordance with the presentation requirements of GASB 34 for fund financial statements. The following is a summary of the significant accounting principles and policies used in the preparation of the accompanying financial statements. A. Description of Funds For reporting purposes, the accounting records are organized into the following two fund types: governmental funds and a fiduciary fund. Governmental Funds General Fund — The General Fund, which is a governmental fund, is used to account for all revenues and expenditures applicable to the general (both court and non -court) operations of the Clerk which are not accounted for in another fund. All financial resources, which are not accounted for and reported in another fund, are recorded in the General Fund. The governmental fund measurement focus is based upon determination of financial position and changes in financial position (sources, uses and balances of financial resources) rather than upon net income determination. Special Revenue Fund — The Special Revenue Fund accounts for the proceeds from recording fees to be used for modernizing the Clerk's public records systems, subsidizing court -related operational needs and program enhancements, and adding access to public records (by charging a computer usage fee). Fiduciary Fund Agency Fund — The Agency Fund is used to account for assets held by the Clerk in a trustee capacity or as an agent. These funds cannot be used to support the Clerk's own programs. 302 Indian River County, Florida Clerk of the Circuit Court and Comptroller Notes To Financial Statements Year Ended September 30, 2014 NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - Continued B. Basis of Accounting, Measurement Focus and Presentation The accounts of the governmental funds are maintained on the modified accrual basis. Under the modified accrual basis, expenditures are recorded at the time liabilities are incurred. Revenues are recorded when received in cash or when they are considered both measurable and available. The Clerk only considers revenue to be available if collected within the current fiscal year, except for Title IV -D grant revenue. This grant revenue is subject to accrual and has been recognized as revenue of the current fiscal period. Revenues collected in excess of expenditures are not considered earned and are reflected as liabilities. The fiduciary fund is accounted for on the accrual basis. C. Budgetary Requirements State statutes require the Clerk to prepare his budget in two parts: the budget relating to the State court system and the budget relating to the requirements of the Clerk as Clerk to the Board of County Commissioners, County auditor, and custodian of all County funds and other County -related duties. The budget relating to the State court system is prepared by the Clerk and submitted to the Florida Clerks of Court Operations Corporation (CCOC) by June 1 of each year (for consolidation to the Florida Legislative Budget Commission by August 1). The budget relating to the requirements of the Clerk as Clerk to the Board of County Commissioners is prepared prior to May 1 and is reviewed, modified if required, and approved by the Board by October 1. Both budgets are adopted on a basis consistent with generally accepted accounting principles. The budget legally adopted by the Clerk must be balanced; that is, the total of estimated receipts, including funding from the Board, shall equal the total estimated expenditures. Management is authorized to transfer budgeted amounts between objects and departments in any fund as long as management does not exceed the total appropriations of a fund. D. Cash and Cash Equivalents Cash and cash equivalents include deposits and all highly liquid investments with maturities of ninety days or less when purchased. E. Prepaid Items This account represents prepayments for services that will be used in future periods. The Clerk's policy is to record the expenditure for the services when they are used rather than when the cash is disbursed. F. Capital Assets Acquisitions of equipment are recorded as expenditures at the time of purchase for governmental fund financial statements. Tangible personal property used by the Clerk in operations is reported in the financial statements of the County. Refer to the County -wide note on capital assets for capitalization threshold, depreciation methodology and useful lives. 303 Indian River County, Florida Clerk of the Circuit Court and Comptroller Notes To Financial Statements Year Ended September 30, 2014 NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - Continued G. Compensated Absences The Clerk accrues a liability for employees' rights to receive compensation for future absences when certain conditions are met. The Clerk does not, nor is he legally required to, accumulate expendable available financial resources to liquidate this obligation. Accordingly, the liability for compensated absences is not reported in the Clerk's financial statements. Additional information on the liability is reflected in subsequent Note 6. H. Transfer In The non -court operations (finance function and board meeting recordings) were funded by the Board of County Commissioners in the amount of $902,281. I. Transfer Out In accordance with Florida Statutes, all non -court -related revenues in excess of expenditures as of year- end are owed to the Board of County Commissioners before November 1. On October 27, 2014, $51,094 was returned to the Board. This transfer is included in the amount Due to Other Governments on the balance sheet. J. Fund Balance GASB Statement 54 — Fund Balance Reporting and Governmental Funds Type Definitions was implemented as of October 1, 2009. The Statement requires the fund balance for governmental funds to be reported in classifications that comprise a hierarchy based primarily on the extent to which the government is bound to honor constraints on the specific purposes for which amounts in those funds can be spent. Categories for fund balance are as follows: nonspendable, restricted, committed, assigned, and unassigned. For more information, see the County -wide note on fund balance. 304 Indian River County, Florida Clerk of the Circuit Court and Comptroller Notes To Financial Statements Year Ended September 30, 2014 NOTE 2 - CASH AND CASH EQUIVALENTS A. Deposits At September 30, 2014, the carrying value of the Clerk's deposits was $4,351,241 and the bank balance was $5,855,816. All deposits with financial institutions were 100% insured by federal depository insurance or by collateral provided by qualified public depositories to the State Treasurer in accordance with Section 280.01, Florida Statutes, also known as the Florida Security for Public Deposits Act. Cash on hand at September 30, 2014 was $1,925. The Clerk's office follows the above state law (governing custodial credit risk) for cash deposits. Refer to the County -wide note on cash and cash equivalents for the definition of custodial credit risk. B. Investments As of September 30, 2014, the Clerk had the following investments: Investment Type Bank United Public Funds Money Market Florida Community Bank Public Funds Money Market Harbor Community Bank Money Market Total Fair Value Interest Rate Risk Fair Value $ 1,202,770 $ 1,502,500 $ 1,652,263 $ 4,357,533 Weighted Average Maturity (In Years) 0.08 0.08 0.08 Portfolio Percentage 28% 34 38 100 % The Clerk adopted an investment policy on April 25, 2013 with the intent to match maturities with known cash needs and anticipated cash flow requirements. The policy was April 24, 2014 to increase individual money market allocations from 35% to 40%. The policy included the following limits: • All final maturities are three years or less, • At least 50% of the portfolio shall be invested in readily available funds. 305 investment updated on Indian River County, Florida Clerk of the Circuit Court and Comptroller Notes To Financial Statements Year Ended September 30, 2014 NOTE 2 - CASH AND CASH EQUIVALENTS B. Investments - Continued Credit Risk Authorized investments are subject to the restrictions imposed by Section 218.145 of the Florida Statues and are limited to the following securities: • Florida Local Government Investment Trust Funds (FLGIT), • State of Florida Local Government Surplus Funds Trust Funds, for existing fund only, • Interest-bearing time deposits or savings accounts in qualified public depositories (as defined in Section 280.02, FS), • Money market funds registered with the Securities and Exchange Commission (with the highest quality rating from a nationally recognized rating agency), • Derivatives are prohibited. Concentration Risk The following limits on portfolio composition are outlined in the Clerk's investment policy: • No more than 10% or $1 Million of the total portfolio may be placed in certificates of deposit with a Qualified Public Depository with any one financial institution, • No more than 40% of the portfolio may be placed in any money market fund or intergovernmental investment pool. NOTE 3 — PENSION PLAN Florida Retirement System Plan Description: The Clerk's employees participate in the Florida Retirement System (FRS), a cost- sharing, multiple -employer public employee retirement system, administered by the Florida Department of Management Services. Effective July 1, 2011, the FRS became a contributory plan for all members, except DROP participants, whereby members contribute 3% and employers pay a rate based upon each member's employment class. Classes and rates in effect at July 1, 2014 were: regular class 7.37%, senior class 21.14%, DROP class 12.28%, and elected official class 43.24%. Employees elect participation in either the defined benefit plan (Pension Plan) or the defined contribution plan (Investment Plan). If the employee enrolled in the FRS prior to July 1, 2011, normal retirement is age 62 with 6 years of service or 30 years of service, regardless of age. If the employee enrolled in the FRS on or after July 1, 2011, normal retirement is age 65 with 8 years of service or 33 years of service, regardless of age. 306 Indian River County, Florida Clerk of the Circuit Court and Comptroller Notes To Financial Statements Year Ended September 30, 2014 NOTE 3 — PENSION PLAN - Continued Florida Retirement System - Continued Under the Pension Plan, early retirement is available before reaching normal retirement age and will be subject to an early-retirement reduction of 5% for each year your age at retirement is under your normal retirement age. For those employees who elect participation in the Investment Plan rather than the Pension Plan, vesting occurs after one year of service. Participants have access to the full value of their vested account balance when they leave FRS employment, regardless of age. These participants receive a defined contribution for self-direction in an investment product with a third party administrator selected by the State Board of Administration. Retirement benefits are determined by age, years of service, the average of the highest 5 or 8 fiscal years of pay, membership class and the payment option selected at retirement. For further information concerning the Florida Retirement System and contribution rates, please read the County -wide note on pension plans. Employer contributions to the FRS for the fiscal years ended September 30, 2012, 2013 and 2014, were equal to 5.21%, 5.24%, and 9.81% of the annual covered payroll. Employer contributions to the FRS for the fiscal years ended September 30, 2012, 2013 and 2014 were $186,001, $183,360, and $350,544 respectively. Employee contributions for the fiscal years ended September 30, 2012, 2013 and 2014 were $91,895, $93,110 and $97,090 respectively. Both employer and employee contributions were equal to 100% of the required contribution for each year. NOTE 4 — OTHER POSTEMPLOYMENT BENEFITS The Clerk participated in the Indian River County Other Postemployment Benefits Trust (IRCOT). The Clerk's 2014 annual contribution of $166,560 was funded by the Board of County Commissioners in the amount of $24,479; non -court revenue in the amount of $22,671; court -related State expenditures in the amount of $116,303; and the public modernization trust fund in the amount of $3,107. This contribution was considered part of a total contribution determined by the IRCOT actuary. Further information on the IRCOT can be found in the County -wide financial statements and in the County notes. 307 Indian River County, Florida Clerk of the Circuit Court and Comptroller Notes To Financial Statements Year Ended September 30, 2014 NOTE 5 — RISK MANAGEMENT Indian River County maintains a risk management program that provides for coverage of risks of loss related to torts, theft of, damage to and destruction of assets, errors or omissions, injuries to employees, natural disasters, and medical and life insurance coverage for employees and their eligible dependents. Various excess catastrophe insurance policies with a commercial carrier are also in force for claims exceeding the amount chargeable against the Self-insurance Fund. The Clerk participated in the County's self-insurance program during the fiscal year at an annual cost of approximately $670,490. Further details of this self-insurance program are discussed in the County -wide financial statements and County -wide note on risk management. NOTE 6 — LONG-TERM LIABILITIES Changes in Long -Term Liabilities The following is a schedule of changes in long-term liabilities as of September 30, 2014: Beginning Ending Balance Balance 10/01/13 Additions Deletions 9/30/14 Accrued Compensated Absences $ 301,525 $ 324,560 $ 398,099 $ 227,986 Of the $227,986 liability for accrued compensated absences, management estimates that $75,000 will be due and payable within one year. The long-term liabilities are not reported in the financial statements of the Clerk since they are not payable from available spendable resources. They are reported in the financial statements of the County by the fund which normally pays the personnel service costs of the employee. 308 ftehmann Rehmann Robson 5070 North Highway A1A Suite 250 Vero Beach, FL 32963 Ph 772.234 8484 Fx 772.234.8488 rehmann.com INDEPENDENT AUDITORS' REPORT ON INTERNAL CONTROL OVER FINANCIAL REPORTING AND ON COMPLIANCE AND OTHER MATTERS BASED ON AN AUDIT OF FINANCIAL STATEMENTS PERFORMED IN ACCORDANCE WITH GOVERNMENT AUDITING STANDARDS March 4, 2015 The Honorable Jeffrey R. Smith Clerk of the Circuit Court and Comptroller Indian River County, Florida We have audited, in accordance with the auditing standards generally accepted in the United States of America and the standards applicable to financial statements contained in Government Auditing Standards issued by the Comptroller General of the United States, the fund financial statements of the major fund and the aggregate remaining fund information of the Indian River County, Florida Clerk of Court (the "Clerk"), as of and for the year ended September 30, 2014, which collectively comprise the Clerk's fund financial statements and have issued our report thereon dated March 4, 2015. Internal Control over Financial Reporting In planning and performing our audit of the financial statements, we considered the Clerk's internal control over financial reporting (internal control) to determine the audit procedures that are appropriate in the circumstances for the purpose of expressing our opinions on the financial statements, but not for the purpose of expressing an opinion on the effectiveness of the Clerk's internal control. Accordingly, we do not express an opinion on the effectiveness of the Clerk's internal control. A deficiency in internal control exists when the design or operation of a control does not allow management or employees, in the normal course of performing their assigned functions, to prevent, or detect and correct misstatements on a timely basis. A material weakness is a deficiency, or a combination of deficiencies, in internal control such that there is a reasonable possibility that a material misstatement of the entity's financial statements will not be prevented, or detected and corrected on a timely basis. A significant deficiency is a deficiency, or a combination of deficiencies, in internal control that is less severe than a material weakness, yet important enough to merit attention by those charged with governance. Our consideration of internal control was for the limited purpose described in the first paragraph of this section and was not designed to identify all deficiencies in internal control that might be material weaknesses or significant deficiencies. Given these limitations, during our audit we did not identify any deficiencies in internal control that we consider to be material weaknesses. However, material weaknesses may exist that have not been identified. Compliance and Other Matters As part of obtaining reasonable assurance about whether the Clerk's financial statements are free of material misstatement, we performed tests of its compliance with certain provisions of laws, Rehmann is an independent member of Nexia International CPAs & Consultants Wealth Advisors Corporate Investigators 309 INTERNATIONAL The Honorable Jeffrey R. Smith Clerk of the Circuit Court and Comptroller March 4, 2015 Page 2 regulations, contracts, and grant agreements, noncompliance with which could have a direct and material effect on the determination of financial statement amounts. However, providing an opinion on compliance with those provisions was not an objective of our audit and, accordingly, we do not express such an opinion. The results of our tests disclosed no instances of noncompliance or other matters that are required to be reported under Government Auditing Standards. Purpose of this Report The purpose of this report is solely to describe the scope of our testing of internal control and compliance and the results of that testing, and not to provide an opinion on the effectiveness of the Clerk's internal control or on compliance. This report is an integral part of an audit performed in accordance with Government Auditing Standards in considering the entity's internal control and compliance. Accordingly, this communication is not suitable for any other purpose. 44440t-41-4". L LC 310 1 1 P4 Ikehmann 1 1 1 1 The Honorable Jeffrey R. Smith MANAGEMENT LETTER March 4, 2015 Rehmann Robson 5070 North Highway A1A Suite 250 Vero Beach, FL 32963 Ph 772.234.8484 Fx 772.234.8488 rehmann.com Clerk of the Circuit Court and Comptroller 1 Indian River County, Florida Report on the Financial Statements We have audited the fund financial statements of the major fund and the aggregate remaining fund information of the Indian River County, Florida Clerk of Court (the "Clerk"), as of and for the year ended September 30, 2014, which collectively comprise the Clerk's fund financial statements and have 1 issued our report thereon dated March 4, 2015. Auditor's Responsibility We conducted our audit in accordance with auditing standards generally accepted in the United States of America; the standards applicable to financial audits contained in Government Auditing Standards, issued by the Comptroller General of the United States; and Chapter 10.550, Rules of the Florida ' Auditor General. Other Reports and Schedule I We have issued our Independent Auditors' Report on Internal Control over Financial Reporting and on Compliance and Other Matters Based on an Audit of the Financial Statements Performed in Accordance with Government Auditing Standards; and Independent Accountants' Report on an examination conducted in accordance with AICPA Professional Standards, Section 601, regarding compliance I requirements in accordance with Chapter 10.550, Rules of the Auditor General. Disclosures in those reports, which are dated March 4, 2015, should be considered in conjunction with this management letter. 1 Section 10.554(1)(i)1., Rules of the Auditor General, requires that we determine whether or not corrective actions have been taken to address findings and recommendations made in the preceding annual financial audit report. There were no findings or recommendations in the preceding annual financial audit report. Prior Audit Findings 1 Official Title and Legal Authority Section 10.554(1)(i)4., Rules of the Auditor General, requires that the name or official title and legal ' authority for the primary government and each component unit of the reporting entity be disclosed in this management letter, unless disclosed in the notes to the financial statements. This information is disclosed in the notes to the financial statements. Rehmann is an independent member of Nexia International. CPAs & Consultants Wealth Advisors Corporate Investigators 1 311 INTERNATIONAL Other Matters Section 10.554(1)(i)2., Rules of the Auditor General, requires that we address in the management letter any recommendations to improve financial management. In connection with our audit, we did not have any such recommendations. Section 10.554(1)(1)3., Rules of the Auditor General, requires that we address noncompliance with provisions of contracts or grant agreements, or abuse, that have occurred, or are likely to have occurred, that have an effect on the financial statements that is less than material but which warrants the attention of those charged with governance. In connection with our audit, we did not have any such findings. Purpose of this Letter Our management letter is intended solely for the information and use of the Legislative Auditing Committee, members of the Florida Senate and the Florida House of Representatives, the Florida Auditor General, Federal and other granting agencies, and applicable management and is not intended to be and should not be used by anyone other than these specified parties. -4.�`�.a,ri- L LG 312 1 1 NFehmann Rehmann Robson 5070 North Highway AlA Suite 250 ' Vero Beach, FL 32963 Ph 772.234.8484 Fx 772.234 8488 rehmann.com 1 INDEPENDENT ACCOUNTANTS' REPORT March 4, 2015 The Honorable Jeffrey R. Smith Clerk of the Circuit Court and Comptroller Indian River County, Florida We have examined the compliance of Indian River County, Florida Clerk of Court and Comptroller (the "Clerk") with Sections 218.415, 28.35 and 28.36, Florida Statutes, during the year ended September 30, 2014. Management is responsible for compliance with those requirements. Our responsibility is to express an opinion on the Clerk's compliance based on our examination. ' Our examination was conducted in accordance with attestation standards established by the American Institute of Certified Public Accountants and, accordingly, includes examining, on a test basis, evidence about the Clerk's compliance with those requirements and performing such other procedures as we considered necessary in the circumstances. We believe that our examination provides a ' reasonable basis for our opinion. Our examination does not provide a legal determination on the Clerk's compliance with specified requirements. In our opinion, the Clerk complied, in all material respects, with the aforementioned requirements for 1 the year ended September 30, 2014. This report is intended solely for the information and use of management, the Clerk, the Board of County Commissioners and the Florida Auditor General and is not intended to be and should not be used by anyone other than these specified parties. 1 1 1 1 Rehmann is an independent member of Nexia International CPAs & Consultants Wealth Advisors Corporate Investigators 1 313 INTERNATIONAL NW ® EMI MN NM Mal MU 11112 MIN MIEN 1212 PM WU Ira NM NM NW OM IMO 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 315 Rehmann INDEPENDENT AUDITORS' REPORT March 4, 2015 The Honorable David Nolte Property Appraiser Indian River County, Florida Report on the Financial Statements Rehmann Robson 5070 North Highway A1A Suite 250 Vero Beach, FL 32963 Ph 772.234 8484 Fx 772.234 8488 rehmann.com We have audited the accompanying fund financial statements of the major fund information of the Indian River County, Florida Property Appraiser (the "Property Appraiser"), as of and for the year ended September 30, 2014, and the related notes to the financial statements, which collectively comprise the Property Appraiser's fund 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. Independent Auditors' 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 of 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 auditors' 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 opinion. Rehmann is an independent member of Nexia International. CPAs & Consultants Wealth Advisors Corporate Investigators 316 INTERN NT10N 4I, Opinion In our opinion, the financial statements referred to above present fairly, in all material respects, the financial position of the fund of the Property Appraiser as of September 30, 2014, and the respective changes in financial position and the respective budgetary comparison for the general fund for the year then ended in accordance with accounting principles generally accepted in the United States of America. Reporting Entity As discussed in Note 1, the financial statements referred to above present only the Indian River County, Florida Property Appraiser and do not purport to, and do not, present fairly the financial position of Indian River County, Florida as of September 30, 2014, and the changes in its financial position for the year then ended, in conformity with accounting principles generally accepted in the United States of America. Other Reporting Required by Government Auditing Standards In accordance with Government Auditing Standards, we have also issued our report dated March 4, 2015 on our consideration of the Property Appraiser'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 Property Appraiser's internal control over financial reporting and compliance. _e4a.,,oced`rn. LLC 317 Indian River County, Florida Property Appraiser Balance Sheet General Fund September 30, 2014 ASSETS Cash and cash equivalents $ 55,143 Accounts receivable 3,385 Total assets $ 58,528 LIABILITIES AND FUND BALANCES Liabilities: Accounts payable $ 20,547 Due to other governments 32,939 Other deposits 5,042 Total liabilities 58,528 Fund Balances: Unassigned Total fund balances Total liabilities and fund balances $ 58,528 The accompanying notes are an integral part of the financial statements. 318 Indian River County, Florida Property Appraiser Statement of Revenues, Expenditures, and Changes in Fund Balances - Budget and Actual General Fund For the Year Ended September 30, 2014 Variance with Final Budget Budgeted Amount Positive Original Final Actual (Negative) REVENUES Charges for services $ 3,112,273 $ 3,118,234 $ 3,125,718 $ 7,484 Interest - - 762 762 Total revenues 3,112,273 3,118,234 3,126,480 8,246 EXPENDITURES General government Total expenditures Excess of revenues over (under) expenditures 3,112,273 3,118,234 3,096,697 21,537 3,112,273 3,118,234 3,096,697 21,537 29,783 29,783 OTHER FINANCING USES Transfers to Board of County Commissioners - (29,783) (29,783) Total other financing uses - (29,783) (29,783) Net change in fund balances $ $ - - $ Fund balances at beginning of year Fund balances at end of year $ The accompanying notes are an integral part of the financial statements. 319 Indian River County, Florida Property Appraiser Notes To Financial Statements Year Ended September 30, 2014 NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES The Property Appraiser is a County agency and a local governmental entity pursuant to Article VIII, Section 1(d) of the Constitution of the State of Florida. For financial statement and reporting purposes, the Property Appraiser does not meet the definition of a legally separate organization and is not considered to be a component unit. The Property Appraiser is considered to be a part of the primary government of Indian River County. The financial statements contained herein represent the financial transactions of the Property Appraiser only. The format of the Property Appraiser's statements has been prepared in accordance with the presentation requirements of GASB 34 for fund financial statements. The following is a summary of the significant accounting principles and policies used in the preparation of the accompanying financial statements. A. Description of Funds For reporting purposes, the accounting records are organized on the basis of governmental funds. Governmental Fund General Fund — The General Fund, which is a governmental fund, is used to account for all revenues and expenditures applicable to the general operations of the Property Appraiser. All financial resources, which are not accounted for and reported in another fund, are recorded in the General Fund. The governmental fund measurement focus is based upon determination of financial position and changes in financial position (sources, uses and balances of financial resources) rather than upon net income determination. B. Basis of Accounting, Measurement Focus and Presentation The accounts of the governmental funds are maintained on the modified accrual basis. Under the modified accrual basis, expenditures are recorded at the time liabilities are incurred. Revenues are recorded when received in cash or when they are considered both measurable and available. Revenues collected in excess of expenditures are not considered earned and are reflected as liabilities. C. Budgetary Requirements State statutes require the Property Appraiser to prepare an annual budget, which clearly reflects the revenues available to his office and the functions for which money is to be expended. The budgeted revenues and expenditures are subject to the review and approval of the Department of Revenue. Management is authorized to transfer budgeted amounts between objects and departments as long as management does not exceed the total appropriations of a fund. Department of Revenue approval is only required when unanticipated revenues are received that management wishes to have appropriated, thereby increasing the total appropriations. The budget is prepared on a basis consistent with generally accepted accounting principles. 320 1 Indian River County, Florida ' Property Appraiser Notes To Financial Statements Year Ended September 30, 2014 1 NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES — Continued D. Capital Assets Acquisitions of equipment are recorded as expenditures at the time of purchase for governmental fund 1 financial statements. Tangible personal property used by the Property Appraiser in operations is reported in the financial statements of the County. Refer to the County -wide note on capital assets for capitalization threshold, depreciation methodology and useful lives. tE. Compensated Absences The Property Appraiser accrues a liability for employees' rights to receive compensation for future absences when certain conditions are met. The Property Appraiser does not, nor is he legally required to, accumulate expendable available financial resources to liquidate this obligation. Accordingly, the ' liability for compensated absences is not reported on the Property Appraiser's financial statements. Additional information on the liability is reflected in subsequent Note 6. 1 F. Transfer Out In accordance with Florida Statutes, all revenues in excess of expenditures as of year-end are owed to 1 the Board of County Commissioners and other governments. These "excess fees" totaled $32,939 at September 30, 2014 and are included as due to other governments on the balance sheet. Of this amount, $29,783 was owed to the Board of County Commissioners and is reported as Transfers to Board of County Commissioners on the Statement of Revenues, Expenditures and Changes in Fund Balances. G. Fund Balance GASB Statement 54 — Fund Balance Reporting and Governmental Funds Type Definitions was implemented as of October 1, 2009. This Statement requires the fund balance for governmental funds to be reported in classifications that comprise a hierarchy based primarily on the extent to which the government is bound to honor constraints on the specific purposes for which amounts in those funds can be spent. Categories for fund balance are as follows: nonspendable, restricted, committed, assigned, and unassigned. For more information, see the County -wide note on fund balance. NOTE 2 - CASH Deposits At September 30, 2014, the carrying amount of the Property Appraiser's deposits was $55,073 and the bank balance was $129,853. All deposits with financial institutions were 100% insured by federal depository insurance or by collateral provided by qualified public depositories to the State Treasurer in accordance with Section 280.01, Florida Statutes, also known as the Florida Security for Public Deposits Act. The Property Appraiser adopted the Board of County Commissioners' investment policy. This policy requires the Property Appraiser's office to follow the above state law (governing custodial credit risk) for cash deposits. Refer to the County -wide note on cash and cash equivalents for the definition of 111 custodial credit risk. Cash on hand at September 30, 2014 was $70. 321 Indian River County, Florida Property Appraiser Notes To Financial Statements Year Ended September 30, 2014 NOTE 3 — PENSION PLAN Florida Retirement System Plan Description: The Property Appraiser's employees participate in the Florida Retirement System (FRS), a cost-sharing, multiple -employer public employee retirement system, administered by the Florida Department of Management Services. Effective July 1, 2011, the FRS became a contributory plan for all members, except DROP participants, whereby members contribute 3% and employers pay a rate based upon each member's employment class (regular class 7.37%, senior class 21.14%, DROP class 12.28%, and elected official class 43.24%). Employees elect participation in either the defined benefit plan (Pension Plan) or the defined contribution plan (Investment Plan). If the employee enrolled in the FRS prior to July 1, 2011, normal retirement is age 62 with 6 years of service or 30 years of service, regardless of age. If the employee enrolled in the FRS on or after July 1, 2011, normal retirement is age 65 with 8 years of service or 33 years of service, regardless of age. Under the Pension Plan, early retirement is available before reaching normal retirement age and will be subject to an early-retirement reduction of 5% for each year your age at retirement is under your normal retirement age. For those employees who elect participation in the Investment Plan rather than the Pension Plan, vesting occurs after one year of service. Participants have access to the full value of their vested account balance when they leave FRS employment, regardless of age. These participants receive a defined contribution for self-direction in an investment product with a third party administrator selected by the State Board of Administration. Retirement benefits are determined by age, years of service, the average of the highest 5 or 8 fiscal years of pay, membership class and the payment option selected at retirement. For further information concerning the Florida Retirement System and contribution rates, please read the County -wide note on pension plans. Employer contributions to the FRS for the fiscal years ended September 30, 2012, 2013, and 2014, were equal to 5.41%, 6.64%, and 10.13% of the annual covered payroll. Employer contributions to the FRS for the fiscal years ended September 30, 2012, 2013, 2014 were $102,232, $123,913, and $199,217 respectively. Employee contributions for the fiscal years ended September 30, 2012, 2013 and 2014 were $52,696, $51,583, and $52,723 respectively. Both employer and employee contributions were equal to 100% of the required contribution for each year. NOTE 4 — OTHER POSTEMPLOYMENT BENEFITS The Property Appraiser participated in the Indian River County Other Postemployment Benefits Trust (IRCOT). The Property Appraiser's 2014 annual contribution of $67,788 was funded by the Board of County Commissioners as part of a total contribution determined by the IRCOT actuary. Further information on the IRCOT can be found in the County -wide financial statements and in the County notes. 322 1 Indian River County, Florida Property Appraiser Notes To Financial Statements Year Ended September 30, 2014 1 NOTE 5 — RISK MANAGEMENT Indian River County maintains a risk management program that provides for coverage of risks of loss related to torts, theft of, damage to and destruction of assets, errors or omissions, injuries to employees, natural disasters, and medical and life insurance coverage for employees and their eligible dependents. Various excess catastrophe insurance policies with a commercial carrier are also in force for claims exceeding the amount chargeable against the Self Insurance Fund. The Property Appraiser participated in the County's self-insurance program during fiscal year 2014 at an annual cost of approximately 1 $266,282. Further details on the self-insurance program are discussed in the County -wide financial statements and County notes. 1 Beginning Ending g n g NOTE 6 — LONG-TERM LIABILITIES Changes in Long -Term Liabilities A summary of changes in long-term liabilities is as follows: Balance Balance 1 10/01/13 Additions Deletions 09/30/14 IAccrued Compensated Absences $ 21,366 $ 115,372 $ 115,555 $ 21,183 Of the $21,183 liability for accrued compensated absences, management estimates that $10,000 will be I due and payable within one year. The lona-term liabilities are not reported in the financial statements of the Property Appraiser since they are not payable from available spendable resources. They are reported in the financial statements of the County. NOTE 7 — COMMITMENTS AND CONTINGENCIES 1 Litigation ' Various suits and claims are currently pending against the Property Appraiser. It is impossible for the Property Appraiser to accurately quantify the exposure involved given the jury's latitude in assessing compensatory and punitive damages, and the court's latitude in awarding attorney's fees. The Property ' Appraiser intends to vigorously defend against these lawsuits and believes he has a good chance of prevailing on their merits. In the opinion of management and based on the advice of legal counsel, the ultimate disposition of these lawsuits will not have a material adverse effect on the financial position of 1 the Property Appraiser. 1 1 323 Rehmann Rehmann Robson 5070 North Highway A1A Suite 250 Vero Beach, FL 32963 Ph 772.234 8484 Fx 772.234 8488 rehmann,com INDEPENDENT AUDITORS' REPORT ON INTERNAL CONTROL OVER FINANCIAL REPORTING AND ON COMPLIANCE AND OTHER MATTERS BASED ON AN AUDIT OF FINANCIAL STATEMENTS PERFORMED IN ACCORDANCE WITH GOVERNMENT AUDITING STANDARDS March 4, 2015 The Honorable David Nolte Property Appraiser Indian River County, Florida We have audited, in accordance with the auditing standards generally accepted in the United States of America and the standards applicable to financial statements contained in Government Auditing Standards issued by the Comptroller General of the United States, the fund financial statements of the major fund of the Indian River County, Florida Property Appraiser (the "Property Appraiser"), as of and for the year ended September 30, 2014, which comprises the Property Appraiser's fund financial statements and have issued our report thereon dated March 4, 2015. Internal Control over Financial Reporting In planning and performing our audit of the financial statements, we considered the Property Appraiser's internal control over financial reporting (internal control) to determine the audit procedures that are appropriate in the circumstances for the purpose of expressing our opinions on the financial statements, but not for the purpose of expressing an opinion on the effectiveness of the Property Appraiser's internal control. Accordingly, we do not express an opinion on the effectiveness of the Property Appraiser's internal control. A deficiency in internal control exists when the design or operation of a control does not allow management or employees, in the normal course of performing their assigned functions, to prevent, or detect and correct misstatements on a timely basis. A material weakness is a deficiency, or a combination of deficiencies, in internal control such that there is a reasonable possibility that a material misstatement of the entity's financial statements will not be prevented, or detected and corrected on a timely basis. A significant deficiency is a deficiency, or a combination of deficiencies, in internal control that is less severe than a material weakness, yet important enough to merit attention by those charged with governance. Our consideration of internal control was for the limited purpose described in the first paragraph of this section and was not designed to identify all deficiencies in internal control that might be material weaknesses or significant deficiencies. Given these limitations, during our audit we did not identify any deficiencies in internal control that we consider to be material weaknesses. However, material weaknesses may exist that have not been identified. Compliance and Other Matters As part of obtaining reasonable assurance about whether the Property Appraiser's financial statements are free of material misstatement, we performed tests of its compliance with certain provisions of Rehmann is an independent member of Nexia International CPAs & Consultants Wealth Advisors Corporate Investigators 324 l+lel INTERNATIONAL The Honorable David Nolte Property Appraiser March 4, 2015 Page 2 laws, regulations, contracts, and grant agreements, noncompliance with which could have a direct and material effect on the determination of financial statement amounts. However, providing an opinion on compliance with those provisions was not an objective of our audit and, accordingly, we do not express such an opinion. The results of our tests disclosed no instances of noncompliance or other matters that are required to be reported under Government Auditing Standards. Purpose of this Report The purpose of this report is solely to describe the scope of our testing of internal control and compliance and the results of that testing, and not to provide an opinion on the effectiveness of the Property Appraiser' internal control or on compliance. This report is an integral part of an audit performed in accordance with Government Auditing Standards in considering the entity's internal control and compliance. Accordingly, this communication is not suitable for any other purpose. 4444C4(.744-nt• LLC 325 Rehmann INDEPENDENT ACCOUNTANTS' REPORT March 4, 2015 The Honorable David Nolte Property Appraiser Indian River County, Florida Rehmann Robson 5070 North Highway A1A Suite 250 Vero Beach, FL 32963 Ph 772.234 8484 Fx 772.234.8488 rehmann.com We have examined the compliance of Indian River County, Florida Property Appraiser (the "Property Appraiser") with Section 218.415, Florida Statutes, during the year ended September 30, 2014. Management is responsible for compliance with those requirements. Our responsibility is to express an opinion on the Property Appraiser's compliance based on our examination. Our examination was conducted in accordance with attestation standards established by the American Institute of Certified Public Accountants and, accordingly, include examining, on a test basis, evidence about the Property Appraiser's compliance with those requirements and performing such other procedures as we considered necessary in the circumstances. We believe that our examination provides a reasonable basis for our opinion. Our examination does not provide a legal determination on the Property Appraiser's compliance with specified requirements. In our opinion, the Property Appraiser complied, in all material respects, with the aforementioned requirements for the year ended September 30, 2014. This report is intended solely for the information and use of management, the Property Appraiser, the Board of County Commissioners and the Florida Auditor General and is not intended to be and should not be used by anyone other than these specified parties. Rehmann is an independent member of Nexia International CPAs & Consultants Wealth Advisors Corporate Investigators 328 LLC � T INTERN NTI n N AI IN Ica laI SHERIFF 3t. &:.fi.•E':.'-...,.. 'a.F33...y :.�3n!:a,reqs-=.? 'i.trkv.., nZT•E'.ti' F.d �a�.sG'5 .. 3xsaw^"'z-e 421FITZ-447.. CZ" tTr1 1.E.. a_7MW.:. 270FE_LTi?A71'-o birMa T2i 329 Indian River County, Florida Sheriff a Statement of Revenues, Expenditures, and Changes in Fund Balances - Budget and Actual General Fund For the Year Ended September 30, 2014 e Variance with Final Budget Budgeted Amounts Positive Original Final Actual (Negative) REVENUES Miscellaneous $ - $ 66,408 $ 56,738 $ (9,670) Total revenues - 66,408 56,738 (9,670) i EXPENDITURES Public safety 35,465,454 36,571,869 36,440,220 131,649 Court related 1,972,527 1,972,527 1,939,357 33,170 Total expenditures 37,437,981 38,544,396 38,379,577 164,819 NI Excess of revenues over (under) expenditures (37,437,981) (38,477,988) (38,322,839) 155,149 OTHER FINANCING SOURCES (USES) Transfers from Board of County Commissioners 37,437,981 38,477,988 38,477,987 (1) Transfers to Board of County Commissioners - (155,148) (155,148) Total other financing sources 37,437,981 38,477,988 38,322,839 (155,149) SI Net change in fund balances $ - $ - $ Fund balances at beginning of year Fund balances at end of year $ The accompanying notes are an integral part of the financial statements. 334 Indian River County, Florida Sheriff Statement of Fiduciary Net Position Agency Fund September 30, 2014 ASSETS Cash and cash equivalents $ 29,637 Total assets $ 29,637 LIABILITIES Escrow deposits $ 29,637 Total liabilities $ 29,637 The accompanying notes are an integral part of the financial statements. 335 Indian River County, Florida Sheriff Notes To Financial Statements Year Ended September 30, 2014 NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES The Sheriff is a County agency and a local governmental entity pursuant to Article VIII, Section 1(d) of the Constitution of the State of Florida. For financial statement and reporting purposes, the Sheriff does not meet the definition of a legally separate organization and is not considered to be a component unit. The Sheriff is considered to be a part of the primary government of Indian River County. The financial statements contained herein represent the financial transactions of the Sheriff only. The format of the Sheriff's statements has been prepared in accordance with the presentation requirements of GASB 34 for fund financial statements. The following is a summary of the significant accounting principles and policies used in the preparation of the accompanying financial statements. A. Description off Funds For reporting purposes, the accounting records are organized into the following two fund types: governmental funds and a fiduciary fund. Governmental Funds General Fund — The General Fund, which is a governmental fund, is used to account for all revenues and expenditures applicable to the general operations of the Sheriff, which are not accounted for in another fund. All financial resources, which are not accounted for and reported in another fund, are recorded in the General Fund. The governmental fund measurement focus is based upon determination of financial position and changes in financial position (sources, uses and balances of financial resources) rather than upon net income determination. Special Revenue Fund — The Special Revenue Fund accounts for the proceeds of specific revenue sources that are legally restricted, committed or assigned for public safety such as police education, special purpose equipment, jail commissary, and special law enforcement activities. Fiduciary Fund Agency Fund — The Agency Fund is used to account for assets held by the Sheriff in a trustee capacity or as an agent. Funds are for the employee cafeteria plan. B. Basis of Accounting, Measurement Focus and Presentation The accounts of the governmental funds are maintained on the modified accrual basis. The fiduciary fund is reported on an accrual basis. Under the modified accrual basis, expenditures are recorded at the time liabilities are incurred. Revenues are recorded when received in cash or when they are considered both measurable and available. Revenues collected in excess of expenditures are not considered earned and are reflected as liabilities. 336 1 Indian River County, Florida I Sheriff Notes To Financial Statements Year Ended September 30, 2014 1 NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - Continued 1 C. Budgetary Requirements State statutes require the Sheriff to submit a proposed budget to the Board of County Commissioners by I May 1 of each year. The budget reflects the estimated amounts of all proposed expenditures for operating and equipping the Sheriff's office and jail. Capital improvements for these buildings are funded by the Board. The budget is prepared on a basis consistent with generally accepted accounting 1 principles. After review and approval of the budget by the Board, the Sheriff is authorized to transfer budgeted amounts between objects and departments as long as he does not exceed the total appropriations approved by the Board. Increases in the total budget are subject to the review and 1 approval of the Board. The budgeted revenues and expenditures in the accompanying financial statements reflect all amendments approved by the Board of County Commissioners. 1 D. Compensated Absences The Sheriff accrues a liability for employees' rights to receive compensation for future absences when 1 certain conditions are met. The Sheriff does not, nor is he legally required to, accumulate expendable available financial resources to liquidate this obligation. Accordingly, the liability for compensated absences is not reported on the Sheriffs financial statements. Additional information on the liability is 1 reflected in subsequent Note 7. E. Transfer Out 1 In accordance with Florida Statutes, all general fund revenues in excess of expenditures as of year-end 1 are owed to the Board of County Commissioners. The September 30, 2014 amount totaled $155,148 and was reported as a transfer to the Board of County Commissioners at year end. This transfer is also included in the due to other governments amount reported on the balance sheet. 1 F. Fund Balance I GASB Statement 54 — Fund Balance Reporting and Governmental Funds Type Definitions was implemented as of October 1, 2009. This Statement requires the fund balance for governmental funds to be reported in classifications that comprise a hierarchy based primarily on the extent to which the I government is bound to honor constraints on the specific purposes for which amounts in those funds can be spent. Categories for fund balance are as follows: nonspendable, restricted, committed, assigned, and unassigned. For more information, see the County -wide note on fund balance. 1 1 1 1 337 Indian River County, Florida Sheriff Notes To Financial Statements Year Ended September 30, 2014 NOTE 2 - CASH Deposits At September 30, 2014, the carrying amount of the Sheriff's deposits was $3,111,493, and the bank balance was $4,450,360. All deposits with financial institutions were 100% insured by federal depository insurance or by collateral provided by qualified public depositories to the State Treasurer in accordance with Section 280.01, Florida Statutes, also known as the Florida Security for Public Deposits Act. Cash on hand at September 30, 2014 was $675. The Sheriff's office elected not to adopt a formal investment policy and selects the alternative investment guidelines as provided by Florida Statutes 218.415, subsection 17. Refer to the County -wide note on cash and cash equivalents for the definition of custodial credit risk. NOTE 3 — CAPITAL ASSETS Tangible personal property used by the Sheriff in operations is reported in the financial statements of the County. State law requires the Sheriff to account for all tangible property used by the Sheriff. A summary of changes in capital assets is as follows: Beginning Ending Balance Balance 10/01/13 Additions Deletions 09/30/14 Tangible Personal Property $ 19,890,327 $ 1,980,675 $ 848,014 $ 21,022,988 Refer to the County -wide note on capital assets for capitalization threshold, depreciation methodology and useful lives. NOTE 4 - INVENTORIES Inventories are valued at cost, which approximates market, using the "first -in, first -out" method of accounting. The costs of inventory are recorded as an expenditure when consumed rather than when purchased. Inventory of the Sheriff represents law enforcement gear, miscellaneous clothing and store items. 338 Indian River County, Florida Sheriff Notes To Financial Statements Year Ended September 30, 2014 NOTE 5 — PENSION PLAN Florida Retirement System Plan Description: The Sheriffs employees participate in the Florida Retirement System (FRS), a cost- sharing, multiple -employer public employee retirement system, administered by the Florida Department of Management Services. Effective July 1, 2011, the FRS became a contributory plan for all members, except DROP participants, whereby members contribute 3% and employers pay a rate based upon each member's employment class (regular class 7.37%, special risk 19.82%, senior class 21.14%, DROP class 12.28%, and elected official class 43.24%). Employees elect participation in either the defined benefit plan (Pension Plan) or the defined contribution plan (Investment Plan). If the employee enrolled in the FRS prior to July 1, 2011, normal retirement is age 62 with 6 years of service or 30 years of service, regardless of age. If the employee enrolled in the FRS on or after July 1, 2011, normal retirement is age 65 with 8 years of service or 33 years of service, regardless of age. Under the Pension Plan, early retirement is available before reaching normal retirement age and will be subject to an early-retirement reduction of 5% for each year your age at retirement is under your normal retirement age. For those employees who elect participation in the Investment Plan rather than the Pension Plan, vesting occurs after one year of service. Participants have access to the full value of their vested account balance when they leave FRS employment, regardless of age. These participants receive a defined contribution for self-direction in an investment product with a third party administrator selected by the State Board of Administration. Retirement benefits are determined by age, years of service, the average of the highest 5 or 8 fiscal years of pay, membership class and the payment option selected at retirement. For further information concerning the Florida Retirement System and contribution rates, please read the County -wide note on pension plans. Employer contributions to the FRS for the fiscal years ended September 30, 2012, 2013, and 2014 were equal to 11.30%, 12.70%, and 15.35% of the annual covered payroll. Employer contributions to the FRS for the fiscal years ended September 30, 2012, 2013, 2014 were $2,544,542, $2,835,772, and $3,490,547 respectively. Employee contributions for the fiscal years ended September 30, 2012, 2013 and 2014 were $629,659, $615,894, and $606,411 respectively. Both employer and employee contributions were equal to 100% of the required contribution for each year. NOTE 6 — OTHER POSTEMPLOYMENT BENEFITS The Sheriff participated in the Indian River County Other Postemployment Benefits Trust (IRCOT). The Sheriffs 2014 annual contribution of $1,101,833 was funded by the Board of County Commissioners as part of a total contribution determined by the IRCOT actuary. Further information on the IRCOT can be found in the County -wide financial statements and County notes. 339 Indian River County, Florida Sheriff Notes To Financial Statements Year Ended September 30, 2014 NOTE 7 — RISK MANAGEMENT Indian River County maintains a risk management program that provides for coverage of risks of loss related to torts, theft of, damage to and destruction of assets, errors or omissions, injuries to employees, natural disasters, and medical and life insurance coverage for employees and their eligible dependents. Various excess catastrophe insurance policies with a commercial carrier are also in force for claims exceeding the amount chargeable against the Self Insurance Fund. The Sheriff participated in the County's self-insurance program during fiscal year 2014 at an annual cost of approximately $3,688,506. Further details on this self-insurance program are disclosed in the County -wide financial statements and County notes. NOTE 8 — LONG-TERM LIABILITIES Changes in Long -Term Liabilities The following is a schedule of changes in long-term liabilities as of September 30, 2014: Beginning Ending Balance Balance 10/01/13 Additions Deletions 09/30/14 Accrued Compensated Absences $ 6,606,399 $ 2,822,313 $ 3,494,997 $ 5,933,715 Of the $5,933,715 liability for accrued compensated absences, management estimates that $3,301,137 will be due and payable within one year. The long-term liabilities are not reported in the financial statements of the Sheriff since they are not payable from available spendable resources. They are reported in the County -wide financial statements and County notes. NOTE 9 — OPERATING LEASES The Sheriff has entered into noncancelable operating leases as lessee of a building, hangar, mail machine, and copiers. Lease expenditures totaled $105,404 for the year ended September 30, 2014. The following is a schedule by years of minimum future rentals to be paid by the Sheriff for noncancelable operating leases as of September 30: Year Amount 2015 $ 84,943 2016 78,412 2017 75,421 2018 2,861 Total Future Minimum Lease Payments $ 241,637 340 Indian River County, Florida Sheriff Notes To Financial Statements Year Ended September 30, 2014 NOTE 10 — COMMITMENTS AND CONTINGENCIES Various suits and claims are currently pending against the Sheriff. It is impossible for the Sheriff to accurately quantify the exposure involved given the jury's latitude in assessing compensatory and punitive damages, and the court's latitude in awarding attorney's fees. The Sheriff intends to vigorously defend against these lawsuits and believes he has a good chance of prevailing on their merits. In the opinion of management and based on the advice of legal counsel, the ultimate disposition of these lawsuits will not have a material adverse effect on the financial position of the Sheriff. 341 Ikehmann Rehmann Robson 5070 North Highway A1A Suite 250 Vero Beach, FL 32963 Ph 772.234 8484 Fx 772.234.8488 rehmann.com INDEPENDENT AUDITORS' REPORT ON INTERNAL CONTROL OVER FINANCIAL REPORTING AND ON COMPLIANCE AND OTHER MATTERS BASED ON AN AUDIT OF FINANCIAL STATEMENTS PERFORMED IN ACCORDANCE WITH GOVERNMENT AUDITING STANDARDS March 4, 2015 The Honorable Deryl Loar Sheriff Indian River County, Florida We have audited, in accordance with the auditing standards generally accepted in the United States of America and the standards applicable to financial statements contained in Government Auditing Standards issued by the Comptroller General of the United States, the fund financial statements of the major fund and the aggregate remaining fund information of the Indian River County, Florida Sheriff (the "Sheriff"), as of and for the year ended September 30, 2014, which collectively comprise the Sheriff's fund financial statements and have issued our report thereon dated March 4, 2015. Internal Control over Financial Reporting In planning and performing our audit of the financial statements, we considered the Sheriff's internal control over financial reporting (internal control) to determine the audit procedures that are appropriate in the circumstances for the purpose of expressing our opinions on the financial statements, but not for the purpose of expressing an opinion on the effectiveness of the Sheriff's internal control. Accordingly, we do not express an opinion on the effectiveness of the Sheriff's internal control. A deficiency in internal control exists when the design or operation of a control does not allow management or employees, in the normal course of performing their assigned functions, to prevent, or detect and correct misstatements on a timely basis. A material weakness is a deficiency, or a combination of deficiencies, in internal control such that there is a reasonable possibility that a material misstatement of the entity's financial statements will not be prevented, or detected and corrected on a timely basis. We consider the deficiency described in the accompanying schedule of findings and responses as item 2014-001 to be a material weakness. A significant deficiency is a deficiency, or a combination of deficiencies, in internal control that is less severe than a material weakness, yet important enough to merit attention by those charged with governance. We consider the deficiency described in the accompanying schedule of findings and responses as item 2014-002 to be a significant deficiency. Our consideration of internal control was for the limited purpose described in the first paragraph of this section and was not designed to identify all deficiencies in internal control that might be material weaknesses or significant deficiencies. Given these limitations, during our audit we did not identify any deficiencies in internal control that we consider to be material weaknesses. However, material weaknesses may exist that have not been identified. Rehmann Is an independent member of Nexia International. CPAs & Consultants Wealth Advisors Corporate Investigators 342 I NTERNATION 1L The Honorable Deryl Loar Sheriff March 4, 2015 Page 2 Compliance and Other Matters As part of obtaining reasonable assurance about whether the Sheriff's financial statements are free of material misstatement, we performed tests of its compliance with certain provisions of laws, regulations, contracts, and grant agreements, noncompliance with which could have a direct and material effect on the determination of financial statement amounts. However, providing an opinion on compliance with those provisions was not an objective of our audit and, accordingly, we do not express such an opinion. The results of our tests disclosed no instances of noncompliance or other matters that are required to be reported under Government Auditing Standards. Indian River County, Florida Sheriff's Response to Findings The Sheriff's responses to the findings identified in our audit are described in the accompanying schedule of findings and responses. The Sheriff's responses were not subjected to the audit of the financial statements and, accordingly, we express no opinion on them. Purpose of this Report The purpose of this report is solely to describe the scope of our testing of internal control and compliance and the results of that testing, and not to provide an opinion on the effectiveness of the Sheriff's internal control or on compliance. This report is an integral part of an audit performed in accordance with Government Auditing Standards in considering the entity's internal control and compliance. Accordingly, this communication is not suitable for any other purpose. 4/146t4g4t:ed-44-yt- L LC 343 INDIAN RIVER COUNTY, FLORIDA SHERIFF ® Schedule of Findings and Responses For the Year Ended September 30, 2014 2014-001 - Material Audit Adjustments Finding Type. Material Weakness in Internal Control over Financial Reporting. Criteria. Management is responsible for maintaining its accounting records in accordance with generally accepted accounting principles (GAAP). Condition. During our audit, we identified and proposed material adjustments (which were approved and posted by management) to adjust the Sheriff's accounting records. Also, management identified and posted many smaller adjustments to a wide variety of funds and accounts throughout the audit process that collectively had a material effect on the Sheriff's financial reporting process. Cause. During the past year, the Sheriff's finance department has experienced turnover in staff. These changes have placed a significant burden on the year-end close process, and has resulted in adjustments not being posted timely. Effect. As a result of this condition, the Sheriff's financial information was initially misstated by amounts that were deemed to be quantitatively material and numerous account balances were not adjusted timely throughout the year. Correcting entries were subsequently posted by management to the Sheriffs records and the appropriate balances are presented in the audited financial statements. Recommendation. Management has already taken appropriate corrective action by posting correcting journal entries. However, we recommend that the Sheriff critically assess the staffing in its Finance Department to ensure that there are an appropriate number of qualified/trained individuals available throughout the year to maintain the Sheriffs books and records in accordance with GAAP. View of Responsible Officials. I have instituted procedures which include a system of Internal Controls to insure that Sheriffs Office books and records are correctly reported in accordance with GAAP. I continually assess the Finance Section, as I do all departments within the Sheriffs Office, to insure that the staffing is appropriate and training is continually available to the individuals responsible for keeping accurate and timely accounting books and records. As your letter indicates, the case of many of the adjustments not being posted timely was due to unexpected staff turnover. 344 INDIAN RIVER COUNTY, FLORIDA SHERIFF ® Schedule of Findings and Responses For the Year Ended September 30, 2014 2014-002 - Journal Entry Review and Support Finding Type. Significant Deficiency in Internal Control over Financial Reporting. Criteria. Journal entries represent an area of significant risk in the financial statements. They provide a mechanism by which financial statements can be altered outside of standard transaction processes. For this reason, internal control practices require that journal entries be reviewed by someone other than the individual who prepares and posts the entry. Condition. Through the audit process, we identified inconsistency in the review and approval of journal entries. Additionally, source documentation was not consistently housed with the journal entry forms. Cause. During FY14, there was an initiative toward automation and a more paperless environment. While these are worthwhile endeavors, the result was that review and approval of journal entries and maintenance of related documentation were not consistent. Effect. As a result of this condition, the Sheriff experienced an increased risk that misstatements in the accounting records, whether caused by error or fraud, would not be detected and corrected on a timely basis. Recommendation. We recommend that the Sheriff establish a journal entry approval procedure to ensure that every journal entry is reviewed and approved prior to posting, and that impacted accounts are reconciled after posting. Additionally we recommend that the Sheriff create an electronic file where all journal entries and original source documents are housed. View of Responsible Officials. As I indicated above, I have established a system of Internal Controls over Financial Reporting which includes a process to review and approve journal entries prior to posting in the accounting records. As a natural evolution of this procedure, not only accounts affected by journal entries, but all relevant general ledger accounts will be reconciled periodically. 345 Rehmann MANAGEMENT LETTER March 4, 2015 The Honorable Deryl Loar Sheriff Indian River County, Florida Report on the Financial Statements Rehmann Robson 5070 North Highway A1A Suite 250 Vero Beach, FL 32963 Ph 772 234 8484 Fx 772 234 8488 rehmann.com We have audited the fund financial statements of the major fund and the aggregate remaining fund information of the Indian River County, Florida Sheriff (the "Sheriff"), as of and for the year ended September 30, 2014, which collectively comprise the Sheriff's fund financial statements and have issued our report thereon dated March 4, 2015. Auditor's Responsibility We conducted our audit in accordance with auditing standards generally accepted in the United States of America; the standards applicable to financial audits contained in Government Auditing Standards, issued by the Comptroller General of the United States; and Chapter 10.550, Rules of the Florida Auditor General. Other Reports and Schedule We have issued our Independent Auditors' Report on Internal Control over Financial Reporting and on Compliance and Other Matters Based on an Audit of the Financial Statements Performed in Accordance with Government Auditing Standards. Disclosures in that report, which is dated March 4, 2015, should be considered in conjunction with this management letter. Prior Audit Findings Section 10.554(1)(i)1., Rules of the Auditor General, requires that we determine whether or not corrective actions have been taken to address findings and recommendations made in the preceding annual financial audit report. There were no findings or recommendations in the preceding annual financial audit report. Official Title and Legal Authority Section 10.554(1)(i)4., Rules of the Auditor General, requires that the name or official title and legal authority for the primary government and each component unit of the reporting entity be disclosed in this management letter, unless disclosed in the notes to the financial statements. This information is disclosed in the notes to the financial statements. Rehmann is an independent member of Nexia International, CPAs & Consultants Wealth Advisors Corporate Investigators 346 INTER NATIONAL Other Matters Section 10.554(1)(i)2., Rules of the Auditor General, requires that we address in the management letter any recommendations to improve financial management. In connection with our audit, we make the following recommendations: 2014-001 - We recommend that the Sheriff critically assess the staffing in its Finance Department to ensure that there are an appropriate number of qualified/trained individuals available throughout the year to maintain the Sheriffs books and records in accordance with GAAP. 2014-002 - We recommend that the Sheriff establish a journal entry approval procedure to ensure that every journal entry is reviewed and approved prior to posting, and that impacted accounts are reconciled after posting. Additionally we recommend that the Sheriff create an electronic file where alt journal entries and original source documents are housed. Section 10.554(1)(i)3., Rules of the Auditor General, requires that we address noncompliance with provisions of contracts or grant agreements, or abuse, that have occurred, or are likely to have occurred, that have an effect on the financial statements that is less than material but which warrants the attention of those charged with governance. In connection with our audit, we did not have any such findings. Purpose of this Letter Our management letter is intended solely for the information and use of the Legislative Auditing Committee, members of the Florida Senate and the Florida House of Representatives, the Florida Auditor General, Federal and other granting agencies, and applicable management and is not intended to be and should not be used by anyone other than these specified parties. LLC 347 Mg ® ® NMI WEI Me SEM ® NM ® OEM KIM ® MO NMI OM MIMI INE 21 SUPERVISOR OF ELECTIONS 11 349 Rehmann INDEPENDENT AUDITORS' REPORT March 4, 2015 The Honorable Leslie Swan Supervisor of Elections Indian River County, Florida Report on the Financial Statements Rehmann Robson 5070 North Highway A1A Suite 250 Vero Beach, FL 32963 Ph 772.234 8484 Fx 772.234 8488 rehmann.com We have audited the accompanying fund financial statements of the major fund and the aggregate remaining fund information of the Indian River County, Florida Supervisor of Elections (the "Supervisor of Elections"), as of and for the year ended September 30, 2014, and the related notes to the financial statements, which collectively comprise the Supervisor of Elections' fund 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. Independent Auditors' 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 of 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 auditors' 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 opinion. Rehmann is an independent member of Nexia International, CPAs & Consultants Wealth Advisors Corporate Investigators 350 I NT CR NATIO N'L Opinion In our opinion, the financial statements referred to above present fairly, in all material respects, the financial position of the funds of the Supervisor of Elections as of September 30, 2014, and the respective changes in financial position and the respective budgetary comparison for the general fund for the year then ended in accordance with accounting principles generally accepted in the United States of America. Reporting Entity As discussed in Note 1, the financial statements referred to above present only the Indian River County, Florida Supervisor of Elections and do not purport to, and do not, present fairly the financial position of Indian River County, Florida as of September 30, 2014, and the changes in its financial position for the year then ended, in conformity with accounting principles generally accepted in the United States of America. Other Reporting Required by Government Auditing Standards In accordance with Government Auditing Standards, we have also issued our report dated March 4, 2015, on our consideration of the Supervisor of Elections' 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 Supervisor of Elections' internal control over financial reporting and compliance. -4440.4(.4.irt. L LC 351 Indian River County, Florida Supervisor of Elections Balance Sheet Governmental Funds September 30, 2014 Nonmajor Fund Total Special Governmental General Revenue Funds ASSETS Cash and cash equivalents $ 25,490 $ 18,510 $ 44,000 Prepaid items 1,809 - 1,809 Total assets $ 27,299 $ 18,510 $ 45,809 I LIABILITIES AND FUND BALANCES Liabilities: Accounts payable $ 22,042 $ - $ 22,042 Due to other governments 5,257 - 5,257 Unearned revenues - 16,158 16,158 Total liabilities 27,299 16,158 43,457 Fund Balances: Nonspendable: Prepaid items 1,809 1,809 Restricted for: Voting/election activities - 2,352 2,352 Unassigned (1,809) - (1,809) Total fund balances 2,352 2,352 Total liabilities and fund balances $ 27,299 $ 18,510 $ 45,809 e 1 1 1 9 1 1 The accompanying notes are an integral part of the financial statements 1 Indian River County, Florida Supervisor of Elections Statement of Revenues, Expenditures, and Changes in Fund Balances Governmental Funds For the Year Ended September 30, 2014 General Nonmajor Fund Total Special Governmental Revenue Funds REVENUES Charges for services $ 3,494 $ $ 3,494 Miscellaneous 53,592 53,592 Total revenues 57,086 57,086 EXPENDITURES General government Total expenditures Excess of revenues over (under) expenditures OTHER FINANCING SOURCES (USES) Transfers from Board of County Commissioners Transfers from other funds Transfers to Board of County Commissioners Transfers to other funds Total other financing sources (uses) 1,129,013 1,129,013 1,129,013 1,129,013 (1,071,927) 1,079,536 (5,257) (2,352) 1,071,927 2,352 (1,071,927) 1,079,536 2,352 (5,257) (2,352) 2,352 1,074.279 Net change in fund balances 2,352 2,352 Fund balances at beginning of year Fund balances at end of year $ - $ 2,352 $ 2,352 The accompanying notes are an integral part of the financial statements. 353 REVENUES Charges for services Miscellaneous Total revenues EXPENDITURES General government Total expenditures Excess of revenues over (under) expenditures Indian River County, Florida Supervisor of Elections Statement of Revenues, Expenditures, and Changes in Fund Balances - Budget and Actual General Fund For the Year Ended September 30, 2014 Variance with Final Budget Budgeted Amount Positive Original Final Actual (Negative) $ - $ 3,494 $ 3,494 53,592 53,592 - 53,592 57,086 3,494 1,075,927 1,130,776 1,129,013 1,763 1,075,927 1,130,776 1,129,013 1,763 (1,075,927) (1,077,184) (1,071,927) 5,257 OTHER FINANCING SOURCES (USES) Transfers from Board of County Comissioners 1,079,536 1,079,536 1,079,536 Transfers to Board of County Comissioners - - (5,257) (5,257) Transfers to other funds (3,609) (2,352) (2,352) Total other financing sources (uses) 1,075,927 1,077,184 1,071,927 (5,257) Net change in fund balances Fund balances at beginning of year Fund balances at end of year The accompanying notes are an integral part of the financial statements. 354 1 Indian River County, Florida 1 Supervisor of Elections Notes To Financial Statements Year Ended September 30, 2014 1 NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES 1 The Supervisor of Elections is a County agency and a local governmental entity pursuant to Article VIII, Section 1(d) of the Constitution of the State of Florida. For financial statement and reporting purposes, the Supervisor of Elections does not meet the definition of a legally separate organization and is not considered to be a component unit. The Supervisor of Elections is considered to be a part of the primary government of Indian River County. The financial statements contained herein represent the financial transactions of the Supervisor of Elections only. The format of the Supervisor of Elections' statements has been prepared in accordance with the presentation requirements of GASB 34 for fund financial statements. 1 The following is a summary of the significant accounting principles and policies used in the preparation of the accompanying financial statements. 1 A. Description of Funds The accounting records are organized for reporting purposes on the basis of governmental funds. 1 Governmental Funds General Fund — The General Fund, which is a governmental fund, is used to account for all revenues and 1 expenditures applicable to the general operations of the Supervisor of Elections. All financial resources, which are not accounted for and reported in another fund, are recorded in the General Fund. The 1 governmental fund measurement focus is based upon determination of financial position and changes in financial position (sources, uses and balances of financial resources) rather than upon net income determination. 1 Special Revenue Fund — The Special Revenue Fund accounts for the grant proceeds from the State and matching funds from the County. These funds are legally restricted for voter education and poll worker 1 recruitment and training. B. Basis of Accounting, Measurement Focus and Presentation 1 The accounts of the governmental funds are maintained on the modified accrual basis. Under the modified accrual basis, expenditures are recorded at the time liabilities are incurred. Revenues are 1 recorded when received in cash or when they are considered both measurable and available. Revenues collected in excess of expenditures are not considered earned and are reflected as liabilities. C. Budgetary Requirements State statutes require the Supervisor of Elections to submit a proposed budget to the Board of County ' Commissioners by May 1 of each year. After review and approval of the budget by the Board, the Supervisor or Elections is authorized to transfer budgeted amounts between objects and departments as long as she does not exceed the total appropriations approved by the Board. Increases in the total budget ' are subject to the review and approval of the Board. The budgeted revenues and expenditures in the accompanying financial statements reflect all amendments approved by the Board of County Commissioners. The budget is prepared on a basis consistent with generally accepted accounting 1 principles. 355 Indian River County, Florida Supervisor of Elections Notes To Financial Statements Year Ended September 30, 2014 NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - Continued D. Prepaid Items Deposits in the governmental funds represent prepayments for services that will be used in future periods. The Supervisor of Election's policy is to record the expenditure for the services when they are used rather than when the cash is disbursed. E. Capital Assets Acquisitions of equipment are recorded as expenditures at the time of purchase for governmental fund financial statements. Tangible personal property used by the Supervisor of Elections in operations is reported in the financial statements of the County. Refer to the County -wide note on capital assets for the capitalization threshold, depreciation methodology and useful lives. F. Unearned Revenues Unearned revenues reported on the Supervisor of Election's balance sheet represent revenues which are available but not earned. G. Compensated Absences The Supervisor of Elections accrues a liability for employees' rights to receive compensation for future absences when certain conditions are met. The Supervisor of Elections does not, nor is she legally required to, accumulate expendable available financial resources to liquidate this obligation. Accordingly, the liability for compensated absences is not reported on the Supervisor of Elections' financial statements. Additional information on the liability is reflected in subsequent Note 6. H. Transfer Out In accordance with Florida Statutes, all general fund revenues in excess of expenditures as of year-end are owed to the Board of County Commissioners and other governments. This unspent budget totaled $5,257 and was reported as transfers out. These transfers are also reflected as due to other governments on the balance sheet. I. Fund Balance GASB Statement 54 — Fund Balance Reporting and Governmental Funds Type Definitions was implemented as of October 1, 2009. This Statement requires the fund balance for governmental funds to be reported in classifications that comprise a hierarchy based primarily on the extent to which the government is bound to honor constraints on the specific purposes for which amounts in those funds can be spent. Categories for fund balance are as follows: nonspendable, restricted, committed, assigned, and unassigned. For more information, see the County -wide note on fund balance. 356 Indian River County, Florida Supervisor of Elections Notes To Financial Statements Year Ended September 30, 2014 NOTE 2 - CASH Deposits At September 30, 2014, the carrying amount of the Supervisor of Elections' deposits was $43,975, and the bank balance was $176,020. All deposits with financial institutions were 100% insured by federal depository insurance or by collateral provided by qualified public depositories to the State Treasurer in accordance with Section 280.01, Florida Statutes, also known as the Florida Security for Public Deposits Act. Cash on hand at September 30, 2014 was $25. The Supervisor of Elections has adopted the Board of County Commissioners' investment policy. This policy requires the Supervisor of Elections' office to follow the above state law (governing custodial credit risk) for cash deposits. Refer to the County -wide note on cash and cash equivalents for the definition of custodial credit risk. NOTE 3 — PENSION PLAN Florida Retirement System Plan Description: The Supervisor of Elections' employees participate in the Florida Retirement System (FRS), a cost-sharing, multiple -employer public employee retirement system, administered by the Florida Department of Management Services. Effective July 1, 2011, the FRS became a contributory plan for all members, except DROP participants, whereby members contribute 3% and employers pay a rate based upon each member's employment class (regular class 7.37%, senior class 21.14%, DROP class 12.28%, and elected official class 43.24%). Employees elect participation in either the defined benefit plan (Pension Plan) or the defined contribution plan (Investment Plan). If the employee enrolled in the FRS prior to July 1, 2011, normal retirement is age 62 with 6 years of service or 30 years of service, regardless of age. If the employee enrolled in the FRS on or after July 1, 2011, normal retirement is age 65 with 8 years of service or 33 years of service, regardless of age. Under the Pension Plan, early retirement is available before reaching normal retirement age and will be subject to an early- retirement reduction of 5% for each year your age at retirement is under your normal retirement age. For those employees who elect participation in the Investment Plan rather than the Pension Plan, vesting occurs after one year of service. Participants have access to the full value of their vested account balance when they leave FRS employment, regardless of age. These participants receive a defined contribution for self-direction in an investment product with a third party administrator selected by the State Board of Administration. Retirement benefits are determined by age, years of service, the average of the highest 5 or 8 fiscal years of pay, membership class and the payment option selected at retirement. For further information concerning the Florida Retirement System and contribution rates, please read the County -wide note on pension plans. 357 Indian River County, Florida Supervisor of Elections Notes To Financial Statements Year Ended September 30, 2014 NOTE 3 — PENSION PLAN - Continued Florida Retirement System - Continued Employer contributions to the FRS for the fiscal years ended September 30, 2012, 2013, and 2014, were equal to 6.19%, 7.46%, and 13.78% of the annual covered payroll. Employer contributions to the FRS for the fiscal years ended September 30, 2012, 2013, 2014 were $28,013, $33,448 and $64,389 respectively. Employee contributions for the fiscal years ended September 30, 2012, 2013 and 2014 were $13,585, $12,975, and $12,269 respectively. Both employer and employee contributions were equal to 100% of the required contribution for each year. NOTE 4 — OTHER POSTEMPLOYMENT BENEFITS The Supervisor of Elections participated in the Indian River County Other Postemployment Benefits Trust (IRCOT). The Supervisor of Election's 2014 annual contribution of $15,064 was funded by the Board of County Commissioners as part of a total contribution determined by the IRCOT actuary. Further information on the IRCOT can be found in the County -wide financial statements and County notes. NOTE 5 — RISK MANAGEMENT Indian River County maintains a risk management program that provides for coverage of risks of loss related to torts, theft of, damage to and destruction of assets, errors or omissions, injuries to employees, natural disasters, and medical and life insurance coverage for employees and their eligible dependents. Various excess catastrophe insurance policies with a commercial carrier are also in force for claims exceeding the amount chargeable against the Self-insurance Fund. The Supervisor of Elections participated in the County's self-insurance program during fiscal year 2014 at an annual cost of approximately $53,120. NOTE 6 — LONG-TERM LIABILITIES Changes in Long -Term Liabilities The following is a schedule of changes in long-term liabilities as of September 30, 2014: Beginning Ending Balance Balance 10/01/13 Additions Deletions 09/30/14 Accrued Compensated Absences $ 30,010 $ 26,905 $ 30,244 $ 26,671 Of the $26,671 liability for accrued compensated absences, management estimates that $11,018 will be due and payable within one year. The liability for accrued compensated absences is not reported in the financial statements of the Supervisor of Elections since it is not payable from available spendable resources. The liability is reported in the financial statements of the County. 358 . Indian River County, Florida Supervisor of Elections Notes To Financial Statements Year Ended September 30, 2014 NOTE 7 — OPERATING LEASES The Supervisor of Elections has entered into noncancelable operating leases as lessee for a mail machine and letter opener. Lease expenditures totaled $6,672 for the year ended September 30, 2014. The following is a schedule by years of minimum future rentals to be paid by the Supervisor of Elections for the noncancelable operating leases as of September 30: Year Amount 2015 $ 6,672 2016 6,672 2017 5,004 Total Future Minimum Lease Payments $ 18,348 359 Rehmann Rehmann Robson 5070 North Highway Al Suite 250 Vero Beach, FL 32963 Ph 772.234 8484 Fx 772.234 8488 rehmann.com INDEPENDENT AUDITORS' REPORT ON INTERNAL CONTROL OVER FINANCIAL REPORTING AND ON COMPLIANCE AND OTHER MATTERS BASED ON AN AUDIT OF FINANCIAL STATEMENTS PERFORMED IN ACCORDANCE WITH GOVERNMENT AUDITING STANDARDS March 4, 2015 The Honorable Leslie Swan Supervisor of Elections Indian River County, Florida We have audited, in accordance with the auditing standards generally accepted in the United States of America and the standards applicable to financial statements contained in Government Auditing Standards issued by the Comptroller General of the United States, the fund financial statements of the major fund and the aggregate remaining fund information of the Indian River County, Florida Supervisor of Elections (the "Supervisor of Elections"), as of and for the year ended September 30, 2014, which collectively comprise the Supervisor of Elections' fund financial statements and have issued our report thereon dated March 4, 2015. Internal Control over Financial Reporting In planning and performing our audit of the financial statements, we considered the Supervisor of Elections' internal control over financial reporting (internal control) to determine the audit procedures that are appropriate in the circumstances for the purpose of expressing our opinions on the financial statements, but not for the purpose of expressing an opinion on the effectiveness of the Supervisor of Elections' internal control. Accordingly, we do not express an opinion on the effectiveness of the Supervisor of Elections' internal control. A deficiency in internal control exists when the design or operation of a control does not allow management or employees, in the normal course of performing their assigned functions, to prevent, or detect and correct misstatements on a timely basis. A material weakness is a deficiency, or a combination of deficiencies, in internal control such that there is a reasonable possibility that a material misstatement of the entity's financial statements will not be prevented, or detected and corrected on a timely basis. A significant deficiency is a deficiency, or a combination of deficiencies, in internal control that is less severe than a material weakness, yet important enough to merit attention by those charged with governance. Our consideration of internal control was for the limited purpose described in the first paragraph of this section and was not designed to identify all deficiencies in internal control that might be material weaknesses or significant deficiencies. Given these limitations, during our audit we did not identify any deficiencies in internal control that we consider to be material weaknesses., However, material weaknesses may exist that have not been identified. Rehmann is an independent member of Nexia International CPAs & Consultants Wealth Advisors Corporate Investlgators 360 3. NT [RN AT ION 41. The Honorable Leslie Swan Supervisor of Elections March 4, 2015 Page 2 Compliance and Other Matters As part of obtaining reasonable assurance about whether the Supervisor of Elections' financial statements are free of material misstatement, we performed tests of its compliance with certain provisions of laws, regulations, contracts, and grant agreements, noncompliance with which could have a direct and material effect on the determination of financial statement amounts. However, providing an opinion on compliance with those provisions was not an objective of our audit and, accordingly, we do not express such an opinion. The results of our tests disclosed no instances of noncompliance or other matters that are required to be reported under Government Auditing Standards. Purpose of this Report The purpose of this report is solely to describe the scope of our testing of internal control and compliance and the results of that testing, and not to provide an opinion on the effectiveness of the Supervisor of Elections' internal control or on compliance. This report is an integral part of an audit performed in accordance with Government Auditing Standards in considering the entity's internal control and compliance. Accordingly, this communication is not suitable for any other purpose. 4.440C -./A -"'t, LLC 361 Rehmann MANAGEMENT LETTER March 4, 2015 The Honorable Leslie Swan Supervisor of Elections Indian River County, Florida Report on the Financial Statements Rehmann Robson 5070 North Highway A1A Suite 250 Vero Beach, FL 32963 Ph 772 234 8484 Fx 772.234 8488 rehmann.com We have audited the fund financial statements of the major fund and the aggregate remaining fund information of the Indian River County, Florida Supervisor of Elections (the "Supervisor of Elections), as of and for the year ended September 30, 2014, which collectively comprise the Supervisor of Elections' fund financial statements and have issued our report thereon dated March 4, 2015. Auditor's Responsibility We conducted our audit in accordance with auditing standards generally accepted in the United States of America; the standards applicable to financial audits contained in Government Auditing Standards, issued by the Comptroller General of the United States; and Chapter 10.550, Rules of the Florida Auditor General. Other Reports and Schedule We have issued our Independent Auditors' Report on Internal Control over Financial Reporting and on Compliance and Other Matters Based on an Audit of the Financial Statements Performed in Accordance with Government Auditing Standards. Disclosures in that report, which is dated March 4, 2015, should be considered in conjunction with this management letter. Prior Audit Findings Section 10.554(1)(i)1., Rules of the Auditor General, requires that we determine whether or not corrective actions have been taken to address findings and recommendations made in the preceding annual financial audit report. There were no findings or recommendations in the preceding annual financial audit report. Official Title and Legal Authority Section 10.554(1)(i)4., Rules of the Auditor General, requires that the name or official title and legal authority for the primary government and each component unit of the reporting entity be disclosed in this management letter, unless disclosed in the notes to the financial statements. This information is disclosed in the notes to the financial statements. Rehmann is an independent member of Nexia International CPAs & Consultants Wealth Advisors Corporate Investigators 362 INTERNATIONAL Other Matters Section 10.554(1)(i)2., Rules of the Auditor General, requires that we address in the management letter any recommendations to improve financial management. In connection with our audit, we did not have any such recommendations. Section 10.554(1)(i)3., Rules of the Auditor General, requires that we address noncompliance with provisions of contracts or grant agreements, or abuse, that have occurred, or are likely to have occurred, that have an effect on the financial statements that is less than material but which warrants the attention of those charged with governance. In connection with our audit, we did not have any such findings. Purpose of this Letter Our management letter is intended solely for the information and use of the Legislative Auditing Committee, members of the Florida Senate and the Florida House of Representatives, the Florida Auditor General, Federal and other granting agencies, and applicable management and is not intended to be and should not be used by anyone other than these specified parties. -414"4""":=4+w LLC 363 Me NM sem aZa MEI Ma ems mas emai ems sem Mer mem emm elm men mem ems mem VD L s 0 TAX COLLECTOR •eua:cs:�:_.a:.477:- 3c��' ��.+...�:r.w�,.�' v&E:_:?iT!.er'.."'i.['SE.S,�,w":*'�S!L�:a� _.:s�Fl"�L. ,=_�s6'�ti'�:r$a1.3B2k��:s'"7. �7TiP•�s+*av•u _+r,L`•-rry1�.`t�:.t.tfYet: 365 Rehmann INDEPENDENT AUDITORS' REPORT March 4, 2015 The Honorable Carole Jean Jordan Tax Collector Indian River County, Florida Report on the Financial Statements Rehmann Robson 5070 North Highway A1A Suite 250 Vero Beach, FL 32963 Ph 772 234 8484 Fx 772.234.8488 rehmann.com We have audited the accompanying fund financial statements of the major fund and the aggregate remaining fund information of the Indian River County, Florida Tax Collector (the "Tax Collector"), as of and for the year ended September 30, 2014, and the related notes to the financial statements, which collectively comprise the Tax Collector's fund 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. independent Auditors' 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 of 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 auditors' 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 opinion. Rehmann is an independent member of Nexia International. CPAs & Consultants Wealth Advisors Corporate Investigators 366 INTERNATIONAL Opinion In our opinion, the financial statements referred to above present fairly, in all material respects, the financial position of the funds of the Tax Collector as of September 30, 2014, and the respective changes in financial position and the respective budgetary comparison for the general fund for the year then ended in accordance with accounting principles generally accepted in the United States of America. Reporting Entity As discussed in Note 1, the financial statements referred to above present only the Indian River County, Florida Tax Collector and do not purport to, and do not, present fairly the financial position of Indian River County, Florida as of September 30, 2014, and the changes in its financial position for the year then ended, in conformity with accounting principles generally accepted in the United States of America. Other Reporting Required by Government Auditing Standards In accordance with Government Auditing Standards, we have also issued our report dated March 4, 2015, on our consideration of the Tax Collector'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 Tax Collector's internal control over financial reporting and compliance. 4140t441.4CAgri-o-nt- LLC 367 Indian River County, Florida Tax Collector Balance Sheet General Fund September 30, 2014 ASSETS Cash and cash equivalents Investments Accounts receivable Inventories Prepaid items Total assets $ 1,578,217 881,718 102,398 1,561 1,176 $ 2,565,070 LIABILITIES AND FUND BALANCES Liabilities: Accounts payable $ 206,517 Due to other governments 2,335,121 Unearned revenues 23,278 Other deposits 154 Total liabilities 2,565,070 Fund Balances: Nonspendable: Inventories 1,561 Prepaid items 1,176 Unassigned (2,737) Total fund balances Total liabilities and fund balances $ 2,565,070 The accompanying notes are an integral part of the financial statements. 368 Indian River County, Florida Tax Collector Statement of Revenues, Expenditures, and Changes in Fund Balances - Budget and Actual General Fund For the Year Ended September 30, 2014 Variance with Final Budget Budgeted Amount Positive Original Final Actual (Negative) REVENUES Charges for services $ 5,391,700 $ 5,391,700 $ 5,523,481 $ 131,781 Interest 8,500 8,500 8,180 (320) Total revenues 5,400,200 5,400,200 5,531,661 131,461 EXPENDITURES General government Total expenditures Excess of revenues over (under) expenditures 3,274,255 3,480,711 3,437,822 42,889 3,274,255 3,480,711 3,437,822 42,889 2,125,945 1,919,489 2,093,839 174,350 OTHER FINANCING USES Transfers to Board of County Commissioners (2,125,945) (1,919,489) (2,093,839) (174,350) Total other financing uses (2,125,945) (1,919,489) (2,093,839) (174,350) Net change in fund balances $ - $ - $ Fund balances at beginning of year - Fund balances at end of year $ - The accompanying notes are an integral part of the financial statements. 369 Indian River County, Florida Tax Collector Statement of Fiduciary Net Position Agency Fund September 30, 2014 ASSETS Cash and cash equivalents $ 4,166,929 Total assets $ 4,166,929 LIABILITIES Due to other governments $ 4,166,929 Total liabilities $ 4,166,929 The accompanying notes are an integral part of the financial statements. 370 1 Indian River County, Florida I Tax Collector Notes To Financial Statements Year Ended September 30, 2014 1 NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES I The Tax Collector is a County agency and a local governmental entity pursuant to Article VIII, Section 1(d) of the Constitution of the State of Florida. For financial statement and reporting purposes, the Tax Collector does not meet the definition of a legally separate organization and is not considered to be a I component unit. The Tax Collector is considered to be a part of the primary government of Indian River County. The financial statements contained herein represent the financial transactions of the Tax Collector only. The format of the Tax Collector's statements has been prepared in accordance with the I presentation requirements of GASB 34 for fund financial statements. The following is a summary of the significant accounting principles and policies used in the preparation I of the accompanying financial statements. A. Description of Funds IThe accounting records are organized for reporting purposes on the basis of governmental funds and a fiduciary fund. tGovernmental Fund IGeneral Fund — The General Fund, which is a governmental fund, is used to account for all revenues and expenditures applicable to the general operations of the Tax Collector. All financial resources, which are Inot accounted for and reported in another fund, are recorded in the General Fund. The governmental fund measurement focus is based upon determination of financial position and changes in financial position (sources, uses and balances of financial resources) rather than upon net income determination. IFiduciary Fund I Fiduciary Fund — The Fiduciary Fund of the Tax Collector is the Agency Fund, which is used to account for assets held by the Tax Collector as an agent. The Agency Fund is custodial in nature and does not involve measurement of results of operations. These funds cannot be used to support the Tax I Collector's own programs. I B. Basis of Accounting, Measurement Focus and Presentation The accounts of the governmental funds are maintained on the modified accrual basis. The fiduciary I fund is reported on an accrual basis. Under the modified accrual basis, expenditures are recorded at the time liabilities are incurred. Revenues are recorded when received in cash or when they are considered both measurable and available. Revenues collected in excess of expenditures are not considered earned I and are reflected as liabilities. 1 1 371 I Indian River County, Florida Tax Collector Notes To Financial Statements Year Ended September 30, 2014 NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - Continued C. Budgetary Requirements State statutes require the Tax Collector to prepare an annual budget that clearly reflects the revenues available to her office and the functions for which money is to be expended. The budgeted revenues and expenditures are subject to the review and approval of the Department of Revenue. Management is authorized to transfer budgeted amounts between objects and departments as long as management does not exceed the total appropriations of a fund. Department of Revenue approval is only required when unanticipated revenues are received that management wishes to have appropriated, thereby increasing the total appropriations of a fund. The budget is prepared on a basis consistent with generally accepted accounting principles. D. Cash and Cash Equivalents Cash and cash equivalents include deposits and all highly liquid investments with maturities of ninety days or less when purchased. E. Prepaid Items This account represents prepayments for services that will be used in future periods. The Tax Collector's policy is to record the expenditure for the services when they are used rather than when the cash is disbursed. F. Capital Assets Acquisitions of equipment are recorded as expenditures at the time of purchase for governmental fund financial statements. Tangible personal property used by the Tax Collector in operations is reported in the financial statements of the County. Refer to the County -wide note on capital assets for capitalization threshold, depreciation methodology and useful lives. G. Unearned Revenues Unearned revenues represent revenues which are available but not earned. The amount reported on the Tax Collector's balance sheet of $23,278 represents prepaid vehicle registrations. H. Compensated Absences The Tax Collector accrues a liability for employees' rights to receive compensation for future absences when certain conditions are met. The Tax Collector does not, nor is she legally required to, accumulate expendable available financial resources to liquidate this obligation. Accordingly, the liability for compensated absences is not reported on the Tax Collector's financial statements. Additional information on the liability is reflected in subsequent Note 7. 372 1 Indian River County, Florida Tax Collector Notes To Financial Statements Year Ended September 30, 2014 1 NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - Continued 1 I. Transfer Out In accordance with Florida Statutes, all revenues in excess of expenditures as of year-end are owed to 1 the Board of County Commissioners and other governments. These "excess fees" totaled $2,335,121 at September 30, 2014 and are included as due to other governments on the balance sheet.. Of this amount, $2,093,839 was owed to the Board of County Commissioners and is reported as Transfers to Board of County Commissioners on the Statement of Revenues, Expenditures and Changes in Fund Balances. 1 J. Fund Balance GASB Statement 54 — Fund Balance Reporting and Governmental Funds Type Definitions was implemented as of October 1, 2009. This Statement requires the fund balance for governmental funds to be reported in classifications that comprise a hierarchy based primarily on the extent to which the government is bound to honor constraints on the specific purposes for which amounts in those funds can be spent. Categories for fund balance are as follows: nonspendable, restricted, committed, assigned, and unassigned. For more information, see the County -wide note on fund balance. NOTE 2 - CASH AND CASH EQUIVALENTS A. Deposits 1 At September 30, 2014, the carrying amount of the Tax Collector's deposits was $5,729,646 and the bank balance was $5,696,233. All deposits with financial institutions were 100% insured by federal depository insurance or by collateral provided by qualified public depositories to the State Treasurer in 1 accordance with Section 280.01, Florida Statutes, also known as the Florida Security for Public Deposits Act. Cash on hand at September 30, 2014 was $15,500. B. Investments The Tax Collector last modified their investment and deposit policy in June 2014. This policy requires 1 the Tax Collector's office to follow the above state law (governing custodial credit risk) for deposits and Section 218.415, Florida Statutes. Refer to the County -wide note on cash and cash equivalents for the definition of custodial credit risk. 1 1 1 1 373 Indian River County, Florida Tax Collector Notes To Financial Statements Year Ended September 30, 2014 NOTE 2 - CASH AND CASH EQUIVALENTS - Continued B. Investments - Continued At September 30, 2014, the Tax Collector had the following investments: Investment Type Other Market Rate Investments: Florida PRIME (formerly Fund A) Florida Trust Day to Day Fund Other Fixed Rate Investments: Certificate of Deposit — 12 Month Certificate of Deposit — 24 Month Certificate of Deposit — 24 Month Weighted Average Portfolio Credit Fair Value Maturity In Years Percentage Risks Total Fair Value Portfolio weighted average maturity Concentration Risk $ 95,999 25,296 252,208 255,857 252,358 0.08 0.08 0.82 1.30 0.74 10.89% AAAm 2.87 AAAm 28.60 N/A 29.02 N/A 28.62 N/A 881,718 100.00% 0.83 The Tax Collector's cash and investment policy limits portfolio composition to the following maximum guidelines: Local Government Surplus Funds Trust Fund 95% Florida Trust Day to Day Fund Direct Obligations of the U.S. Government 25% Money Market, CD's, and Savings Accounts 95% Securities & Exchange Commission Money Funds 25% Bank Super NOW Accounts 95% Bank Repo Agreements 50% United States Government Agencies 25% 95% The Tax Collector invests surplus funds in an external investment pool, the Local Government Surplus Funds Trust Fund (the "Florida Prime"). The Florida PRIME is administered by the Florida State Board of Administration ("SBA"), who provides regulatory oversight. The Florida PRIME has adopted operating procedures consistent with the requirements for a 2a-7 like fund. The Tax Collector's investment in the Florida PRIME is reported at amortized cost. The fair value of the positionin the pool is equal to the value of the pool shares. At September 30, 2014, the Florida PRIME held a rating of AAAm by Standard and Poor's and had a weighted average days to maturity of 39 days. 374 Indian River County, Florida Tax Collector Notes To Financial Statements Year Ended September 30, 2014 NOTE 2 - CASH AND INVESTMENTS - Continued B. Investments - Continued Interest Rate Risk The Tax Collector will attempt to match investment maturities with known cash needs and anticipated cash flow requirements. Investments of current operating funds shall have maturities of no longer than twelve months and funds in excess of current operating needs may have maturities of no longer than twenty-four months. Credit Risk Florida Statutes authorize investments in certificates of deposit, savings accounts, the Local Government Surplus Funds Trust Fund administered by the Florida State Board of Administration; Securities and Exchange Commission registered money market funds with the highest credit quality rating from a nationally recognized rating agency, and direct obligations of the U.S. Treasury. Custodial Credit Risk All investments are held in the name of the Tax Collector, by the Tax Collector, with the exception of the Florida Trust Day to Day Fund, which was held by UMB Bank, and the Florida PRIME which was held by BNY Mellon. NOTE 3 - INVENTORIES Inventories are valued at cost, which approximates market, using the "first -in, first -out" method of accounting. The costs of general fund inventory are recorded as an expenditure when consumed rather than when purchased. Inventory of the Tax Collector, included in the general fund, represents postage. 375 Indian River County, Florida Tax Collector Notes To Financial Statements Year Ended September 30, 2014 NOTE 4 — PENSION PLAN Florida Retirement System Plan Description: The Tax Collector's employees participate in the Florida Retirement System (FRS), a cost-sharing, multiple -employer public employee retirement system, administered by the Florida Department of Management Services. Effective July 1, 2011, the FRS became a contributory plan for all members, except DROP participants, whereby members contribute 3% and employers pay a rate based upon each member's employment class (regular class 7.37%, senior class 21.14%, DROP class 12.28%, and elected official class 43.24%). Employees elect participation in either the defined benefit plan (Pension Plan) or the defined contribution plan (Investment Plan). If the employee enrolled in the FRS prior to July 1, 2011, normal retirement is age 62 with 6 years of service or 30 years of service, regardless of age. If the employee enrolled in the FRS on or after July 1, 2011, normal retirement is age 65 with 8 years of service or 33 years of service, regardless of age. Under the Pension Plan, early retirement is available before reaching normal retirement age and will be subject to an early-retirement reduction of 5% for each year your age at retirement is under your normal retirement age. For those employees who elect participation in the Investment Plan rather than the Pension Plan, vesting occurs after one year of service. Participants have access to the full value of their vested account balance when they leave FRS employment, regardless of age. These participants receive a defined contribution for self-direction in an investment product with a third party administrator selected by the State Board of Administration. Retirement benefits are determined by age, years of service, the average of the highest 5 or 8 fiscal years of pay, membership class and the payment option selected at retirement. For further information concerning the Florida Retirement System and contribution rates, please read the County -wide note on pension plans. Employer contributions to the FRS for the fiscal year ended September 30, 2012, 2013, and 2014, were equal to 5.63%, 7.01%, and 11.3% of the annual covered payroll. Employer contributions to the FRS for the fiscal years ended September 30, 2012, 2013, and 2014 were $90,405, $104,670, and $184,421 respectively. Employee contributions for the fiscal years 2012, 2013 and 2014 were $45,214, $42,441 and $47,465. Both employer and employee contributions were equal to 100% of the required contribution for each year. NOTE 5 — OTHER POSTEMPLOYMENT BENEFITS The Tax Collector participated in the Indian River County Other Postemployment Benefits Trust (IRCOT). The Tax Collector paid their 2014 annual contribution of $82,852 which was their part of the total contribution determined by the IRCOT actuary. Further information on the IRCOT can be found in the County -wide financial statements and County notes. 376 Indian River County, Florida Tax Collector Notes To Financial Statements Year Ended September 30, 2014 NOTE 6 — RISK MANAGEMENT Indian River County maintains a risk management program that provides for coverage of risks of loss related to torts, theft of, damage to and destruction of assets, errors or omissions, injuries to employees, natural disasters, and medical and life insurance coverage for employees and their eligible dependents. Various excess catastrophe insurance policies with a commercial carrier are also in force for claims exceeding the amount chargeable against the Self Insurance Fund. The Tax Collector participated in the County's self-insurance program during fiscal year 2014 at an annual cost of approximately $257,960. Further details of this self-insurance program are discussed in the risk management note in the County- wide financial statements. NOTE 7 — LONG-TERM LIABILITIES Changes in Long -Term Liabilities The following is a schedule of changes in long-term liabilities as of September 30, 2014: Accrued Compensated Absences Beginning Ending Balance Balance 10/01/13 Additions Deletions 09/30/14 $ 112,797 $ 37,573 $ 30,352 $ 120,018 Of the $120,018 liability for accrued compensated absences, management estimates that $12,213 will be due and payable within one year. The long-term liabilities are not reported in the financial statements of the Tax Collector since they are not payable from available spendable resources. They are reported in the financial statements of the County. NOTE 8 — OPERATING LEASES The Tax Collector has entered into noncancelable operating leases as lessee for office space and office equipment. Lease expenditures totaled $102,429 for the fiscal year ended September 30, 2014. The following is a schedule by years of minimum future rentals to be paid by the Tax Collector for noncancelable operating leases as of September 30: Year Amount 2015 $ 100,221 2016 55,388 2017 2,352 2018 2,352 Total future minimum lease payments $ 160,313 377 Rehmann Rehmann Robson 5070 North Highway A1A Suite 250 Vero Beach, FL 32963 Ph 772.234 8484 Fx 772.234 8488 rehmann.com INDEPENDENT AUDITORS' REPORT ON INTERNAL CONTROL OVER FINANCIAL REPORTING AND ON COMPLIANCE AND OTHER MATTERS BASED ON AN AUDIT OF FINANCIAL STATEMENTS PERFORMED IN ACCORDANCE WITH GOVERNMENT AUDITING STANDARDS March 4, 2015 The Honorable Carole Jean Jordan Tax Collector Indian River County, Florida We have audited, in accordance with the auditing standards generally accepted in the United States of America and the standards applicable to financial statements contained in Government Auditing Standards issued by the Comptroller General of the United States, the fund financial statements of the major fund and the aggregate remaining fund information of the Indian River County, Florida Tax Collector (the "Tax Collector"), as of and for the year ended September 30, 2014, which collectively comprise the Tax Collector' fund financial statements and have issued our report thereon dated March 4, 2015. Internal Control over Financial Reporting In planning and performing our audit of the financial statements, we considered the Tax Collector' internal control over financial reporting (internal control) to determine the audit procedures that are appropriate in the circumstances for the purpose of expressing our opinions on the financial statements, but not for the purpose of expressing an opinion on the effectiveness of the Tax Collector' internal control. Accordingly, we do not express an opinion on the effectiveness of the Tax Collector' internal control. A deficiency in internal control exists when the design or operation of a control does not allow management or employees, in the normal course of performing their assigned functions, to prevent, or detect and correct misstatements on a timely basis. A material weakness is a deficiency, or a combination of deficiencies, in internal control such that there is a reasonable possibility that a material misstatement of the entity's financial statements will not be prevented, or detected and corrected on a timely basis. A significant deficiency is a deficiency, or a combination of deficiencies, in internal control that is less severe than a material weakness, yet important enough to merit attention by those charged with governance. Our consideration of internal control was for the limited purpose described in the first paragraph of this section and was not designed to identify all deficiencies in internal control that might be material weaknesses or significant deficiencies. Given these limitations, during our audit we did not identify any deficiencies in internal control that we consider to be material weaknesses. However, material weaknesses may exist that have not been identified. Compliance and Other Matters As part of obtaining reasonable assurance about whether the Tax Collector's financial statements are free of material misstatement, we performed tests of its compliance with certain provisions of laws, regulations, contracts, and grant agreements, noncompliance with which could have a direct and Rehmann is an independent member of Nexia International. CPAs & Consultants Wealth Advisors Corporate Investigators 378 I NTLRNATI0N 1i The Honorable Carole Jean Jordan Tax Collector March 4, 2015 Page 2 material effect on the determination of financial statement amounts. However, providing an opinion on compliance with those provisions was not an objective of our audit and, accordingly, we do not express such an opinion. The results of our tests disclosed no instances of noncompliance or other matters that are required to be reported under Government Auditing Standards. Purpose of this Report The purpose of this report is solely to describe the scope of our testing of internal control and compliance and the results of that testing, and not to provide an opinion on the effectiveness of the Tax Collector's internal control or on compliance. This report is an integral part of an audit performed in accordance with Government Auditing Standards in considering the entity's internal control and compliance. Accordingly, this communication is not suitable for any other purpose. _e\d14a.114,tt....ed`M. LLC 379 Rehmann MANAGEMENT LETTER March 4, 2015 The Honorable Carole Jean Jordan Tax Collector Indian River County, Florida Report on the Financial Statements Rehmann Robson 5070 North Highway Al Suite 250 Vero Beach, FL 32963 Ph 772.234 8484 Fx 772 234 8488 rehmann.com We have audited the fund financial statements of the major fund and the aggregate remaining fund information of the Indian River County, Florida Tax Collector (the "Tax Collector"), as of and for the year ended September 30, 2014, which collectively comprise the Tax Collector's fund financial statements and have issued our report thereon dated March 4, 2015. Auditor's Responsibility We conducted our audit inaccordance with auditing standards generally accepted in the United States of America; the standards applicable to financial audits contained in Government Auditing Standards, issued by the Comptroller General of the United States; and Chapter 10.550, Rules of the Florida Auditor General. Other Reports and Schedule We have issued our Independent Auditors' Report on Internal Control over Financial Reporting and on Compliance and Other Matters Based on an Audit of the Financial Statements Performed in Accordance with Government Auditing Standards; and Independent Accountants' Report on an examination conducted in accordance with - AICPA Professional Standards, Section 601, regarding compliance requirements in accordance with Chapter 10.550, Rules of the Auditor General. Disclosures in those reports, which are dated March 4, 2015, should be considered in conjunction with this management letter. Prior Audit Findings Section 10.554(1)(i)1., Rules of the Auditor General, requires that we determine whether or not corrective actions have been taken to address findings and recommendations made in the preceding annual financial audit report. There were no findings or recommendations in the preceding annual financial audit report. Official Title and Legal Authority Section 10.554(1)(i)4., Rules of the Auditor General, requires that the name or official title and legal authority for the primary government and each component unit of the reporting entity be disclosed in Rehmann is an independent member of Nexia International CPAs & Consultants Wealth Advisors Corporate Investigators 380 INTERNATIO`AI this management letter, unless disclosed in the notes to the financial statements. This information is disclosed in the notes to the financial statements.' Other Matters Section 10.554(1)(i)2., Rules of the Auditor General, requires that we address in the management letter any recommendations to improve financial management. In connection with our audit, we did not have any such recommendations. Section 10.554(1)(1)3., Rules of the Auditor General, requires that we address noncompliance with provisions of contracts or grant agreements, or abuse, that have occurred, or are likely to have occurred, that have an effect on the financial statements that is less than material but which warrants the attention of those charged with governance. In connection with our audit, we did not have any such findings. Purpose of this Letter Our management letter is intended solely for the information and use of the Legislative Auditing Committee, members of the Florida Senate and the Florida House of Representatives, the Florida Auditor General, Federal and other granting agencies, and applicable management and is not intended to be and should not be used by anyone other than these specified parties. 44.440(..d4.4)t-, LLC 381 Rehmann INDEPENDENT ACCOUNTANTS' REPORT March 4, 2015 The Honorable Carole Jean Jordan Tax Collector Indian River County, Florida Rehmann Robson 5070 North Highway A1A Suite 250 Vero Beach, FL 32963 Ph 772 234 8484 Fx 772 234 8488 rehmann.com We have examined the compliance of Indian River County, Florida Tax Collector -(the "Tax Collector") with Section 218.415, Florida Statutes, during the year ended September 30, 2014. Management is responsible for compliance with those requirements. Our responsibility is to express an opinion on the Tax Collector's compliance based on our examination. Our examination was conducted in accordance with attestation standards established by the American Institute of Certified Public Accountants and, accordingly, include examining, on a test basis, evidence about the Tax Collector's compliance with those requirements and performing such other procedures as we considered necessary in the circumstances. We believe that our examination provides a reasonable basis for our opinion. Our examination does not provide a legal determination on the Tax Collector's compliance with specified requirements. In our opinion, the Tax Collector complied, in all material respects, with the aforementioned requirements for the year ended September 30, 2014. This report is intended solely for the information and use of management, the Tax Collector, the Board of County Commissioners and the Florida Auditor General and is not intended to be and should not be used by anyone other than these specified parties. Rehmann is an independent member of Nexia International CPAs & Consultants Wealth Advisors Corporate Investigators 382 L LC x TA f NT CR NATION AI