Fort Walton Beach — Comprehensive Annual Financial Report September 30, 2013 — reading text

- Capital Leases 101,696 - - 13,458 101,696 13,458 $ 13,637,632 $ 5,089,940 $ 17,067,110 $ 10,274,642 $ 30,704,742 $ 15,364,582 Additional information on the City of Fort Walton Beach’s long-term debt can be found in Note 13 and 14 of this report on pages 63-68. ECONOMIC FACTORS AND NEXT YEAR’S BUDGET AND RATES Economic indicators and factors that are useful for evaluating the framework within which the City operates are discussed below.  The Consumer Price Index (CPI) is 1.3% higher than a year ago. This indicator translates into a higher cost of providing services to residents.  The Municipal Cost Index is 1.9% higher than a year ago. This index is prepared to show the effects of inflation on the cost of providing municipal services.  The Consumer Confidence Index is at its highest level since 2008. This indicator measures economic conditions by gauging the future spending of consumers. 12   The Leading Economic Index has grown steadily over the last year and is designed to signal turning point patterns in economic data.  The military has a significant presence in our community. These installations are essential to the continued long-term economic vitality of this area. Combined, the military and defense-related industries have a $6.0 billion annual impact on Okaloosa County’s economy, with approximately 73% of our local economy supported by the military. These indicators, as well as others, were taken into account when adopting the City’s budget for fiscal year 2014. The City’s budget for fiscal year 2014 totals $34.7 million, which is $2.7 million higher than the fiscal year 2013 approved budget, due to efforts to return the City to financial stability and programmatic sustainability. The 2014 budget allocates $18.3 million, a 19.3% increase as compared to the fiscal year 2013 budget, to the General fund, $13.2 million to the Enterprise funds, and $3.2 million to other funds. For the fiscal year 2014 budget, the ad valorem rate increased to 5.7697 mills. A 3% increase in water and sewer rates is included in the budget; no other significant changes to the City’s various rate and fees are included in the fiscal year 2014 budget. Personnel expenses account for approximately 50.0% of the City’s budget. The City’s fiscal year 2014 budget remains relatively stable in this category, at 291.02 full time equivalent positions. REQUESTS FOR INFORMATION This financial report is designed to provide citizens, taxpayers, customers, and creditors with a general overview of the City of Fort Walton Beach’s finances and to demonstrate the City’s accountability for the money it receives. Questions concerning any of the information provided in this report, or requests for additional information, should be addressed to the Finance Director, 107 Miracle Strip Parkway S.W., City of Fort Walton Beach, Florida, 32548. This document and other financial information are available on the City’s website at www.fwb.org. Inquiries may also be sent via email to the Finance Department at finance@fwb.org. 13 (THIS PAGE INTENTIONALLY LEFT BLANK.)  EXHIBIT I City of Fort Walton Beach, Florida STATEMENT OF NET POSITION September 30, 2013 Primary Government Governmental Business-Type Activities Activities Total ASSETS Cash and cash equivalents $ 12,769,564 $ 8,468,736 $ 21,238,300 Investments 2,005,963 - 2,005,963 Receivables, net 225,017 795,954 1,020,971 Internal balances 157,846 (157,846) - Due from other governments 97,007 - 97,007 Inventory, at cost 254,229 58,157 312,386 Restricted assets Cash and cash equivalents 7,712,549 1,552,512 9,265,061 Capital assets Non-depreciable/amortizable 10,940,878 16,221,075 27,161,953 Depreciable/amortizable, net 18,536,937 21,612,835 40,149,772 Other assets Bond issue costs, net 26,879 182,649 209,528 Net pension asset 606,629 - 606,629 Other receivables, net - 15,917 15,917 TOTAL ASSETS 53,333,498 48,749,989 102,083,487 LIABILITIES Accounts payable 463,363 2,262,918 2,726,281 Accrued liabilities 585,242 184,071 769,313 Due to other governments - 338,525 338,525 Unearned revenue - 55,708 55,708 Payable from restricted assets Accrued interest 3,783 108,672 112,455 Customer deposits - 164,599 164,599 Non-current liabilities Due within one year Compensated absences 172,537 55,236 227,773 Leases payable 12,042 - 12,042 Notes payable 582,311 18,643 600,954 Revenues bonds payable - 290,000 290,000 Due in more than one year Compensated absences 517,612 165,701 683,313 Leases payable 89,654 - 89,654 Notes payable 12,953,625 54,890 13,008,515 Revenue bonds payable - 9,635,055 9,635,055 State revolving loan payable - 7,068,522 7,068,522 Other post-employment benefits 598,055 268,949 867,004 TOTAL LIABILITIES 15,978,224 20,671,489 36,649,713 NET POSITION Invested in capital assets, net of related debt 23,531,576 20,766,800 44,298,376 Restricted Debt service 21,156 1,087,405 1,108,561 System improvements - 305,508 305,508 Improvement districts 3,833,430 - 3,833,430 Public safety 462,375 - 462,375 Other purposes 177,129 - 177,129 Unrestricted 9,329,608 5,918,787 15,248,395 TOTAL NET POSITION $ 37,355,274 $ 28,078,500 $ 65,433,774 The accompanying notes are an integral part of these financial statements. 14  EXHIBIT II City of Fort Walton Beach, Florida STATEMENT OF ACTIVITIES Year Ended September 30, 2013 Program Revenues Net (Expense) Revenue and Changes in Net Position Primary Government Charges for Operating Grants Capital Grants and Governmental Business-Type Expenses Services and Contributions Contributions Activities Activities Total Function/Program Activities Government activities General government $ 2,662,406 $ 409,983 $ 1,500 $ - $ (2,250,923) $ - $ (2,250,923) Public safety 9,729,228 640,271 410,609 8,427 (8,669,921) - (8,669,921) Physical environment 379,681 404,429 216,930 - 241,678 - 241,678 Transportation 1,631,665 122,275 - 72,509 (1,436,881) - (1,436,881) Economic environment 1,090,025 34,652 55,411 - (999,962) - (999,962) Culture and recreation 2,715,977 374,362 102,202 - (2,239,413) - (2,239,413) Debt service interest 324,405 - - - (324,405) - (324,405) Total government