AgdaPkt 2016-01-11 Closed and Joint SA PFA

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ATTACHMENT 1 6.1.E. - Page 8 May 2006. In FY 2014-15, operating revenues increased to $2.02 million compared to $1.454 million in FY 2013-14 due to increased traffic downtown as people were drawn to the downtown area by the theater, restaurants, City sponsored events, and new businesses, along with an increase in parking rates in the downtown core area. Expenses increased to $2.9 million from $2.5 million. During FY 2013-14, the City sold Block 2 to a developer resulting in a net increase in cash of $14 million. Out of these proceeds, the parking fund reimbursed the capital outlay fund $2.7 million for the realignment of the Middlefield culvert, repaid the $1.3 million loan from the Capital Outlay Fund, and appropriated $1.5 million for parking capital projects. Therefore, at the close of FY 2014-15, $8.5 million remained in the Parking Fund from the proceeds of the land sale. Port The net position for the Port increased by $1.5 million for the fiscal year ended June 30, 2015. Operating revenues decreased 1 .5% from $6.824 million in FY 2013-14 to $6.722 million in FY 2014-15 while operating expenses increased 3.8% from $4.281 million in FY 2013-14 to $4.445 million in FY 2014-15. Self-Insurance Fund Highlights The self-insurance internal service fund, which includes workers' compensation and general liability, had net cash used by operating activities of $1.011 million as premiums charged to operating departments were not sufficient to cover the increased activity in the self-insurance fund. To offset the beginning deficit balance and to maintain funding at a confidence level of 80%, the general fund transferred $2.2 million to the self- insurance fund in FY 2014-15. Despite this transfer, the self-insurance fund ended up with negative equity of $1.1 million as of June 30, 2015, driven in large part by inclusion of unfunded pension liability as required by the implementation of GASB 68 (described below). New Accounting Standard As discussed with Council at various points over the past years, Governmental Accounting Standards Board Statement 68 (GASB 68) — Accounting and Financial Reporting for Pensions was implemented in the FY 2014-15 CAFR. The implementation of GASB 68 resulted in the reporting of the unfunded pension liability on the entity-wide Statement of Net Position and the Proprietary Funds Statement of Net Position, and provided more detailed information in the Notes and Required Supplementary Information sections. GASB 68 required the restatement of the beginning net position, reducing it by $179 million, and the reporting of a net pension liability of $164 million, resulting in a negative unrestricted balance of $7.9 million on the entity-wide Statement of Net Position. ALTERNATIVES Council could elect not to accept the financial report which would result in additional costs associated with additional field work required to be completed by Badawi & Page 6 of 7