Comprehensive annual financial report, Yavapai County, Arizona

              Yavapai County, Arizona
Comprehensive Annual Financial Report
Fiscal Year Ended June 30, 2004
YAVAPAI COUNTY
Comprehensive Annual Financial Report
Year Ended June 30, 2004
i
TABLE OF CONTENTS
INTRODUCTORY SECTION
Letter of Transmittal ..................................................................................................................................1
Certificate of Achievement for Excellence in Financial Reporting .............................................................6
Organizational Chart .................................................................................................................................7
Yavapai County Officials ............................................................................................................................8
FINANCIAL SECTION
Independent Auditor's Report.....................................................................................................................9
Management's Discussion and Analysis
(Required Supplementary Information) .................................................................................................11
BASIC FINANCIAL STATEMENTS:
Government-Wide Financial Statements:
Statement of Net Assets.....................................................................................................................21
Statement of Activities.......................................................................................................................22
Fund Financial Statements:
Balance Sheet-Governmental Funds .................................................................................................24
Reconciliation of the Governmental Funds Balance
Sheet to the Statement of Net Assets .............................................................................................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 Net Assets-Proprietary Funds.......................................................................................31
Statement of Revenues, Expenses and Changes in Fund Net Assets
-Proprietary Funds..........................................................................................................................32
Statement of Cash Flows-Proprietary Funds .....................................................................................33
Statement of Fiduciary Net Assets-Fiduciary Funds ..........................................................................34
Statement of Changes in Fiduciary Net Assets-Fiduciary Funds.......................................................35
Notes to the Financial Statements:
Note 1 - Summary of Significant Accounting Policies.....................................................................36
Note 2 - Deposits and Investments.................................................................................................42
Note 3 - Due From Other Governments .........................................................................................43
Note 4 - Capital Assets ...................................................................................................................44
Note 5 - Long-term Liabilities..........................................................................................................46
Note 6 - Special Assessment Debt Payable...................................................................................46
Note 7 - Bonds ...............................................................................................................................47
Note 8 - Notes Payable...................................................................................................................48
Note 9 - Compensated Absences and Claims and Judgments......................................................48
Note 10 - Capital Leases ..................................................................................................................48
Note 11 - Landfill Closure and Postclosure Care Costs ...................................................................49
Note 12 - Insurance Claims ..............................................................................................................50
Note 13 - Risk Management .............................................................................................................50
Note 14 - Line of Credit Arrangement...............................................................................................51
Note 15 - Retirement Plans...............................................................................................................51
Note 16 - Interfund Balances and Activity.........................................................................................53
Note 17 - Condensed Financial Statements of the County Treasurer’s
Investment Pool ................................................................................................................54
YAVAPAI COUNTY
Comprehensive Annual Financial Report
Year Ended June 30, 2004
ii
Required Supplementary Information:
Schedule of Agent Retirement Plans’ Funding Progress......................................................................57
General Fund.....................................................................................................................................58
Jail District Fund................................................................................................................................60
Regional Road Fund ..........................................................................................................................61
HURF Road Fund..............................................................................................................................62
Notes to Budgetary Comparison Schedules .........................................................................................63
Combining and Individual Fund Statements and Schedules:
Combining Balance Sheet-Nonmajor Governmental Funds ..............................................................68
Combining Statement of Revenues, Expenditures and Changes
in Fund Balances-Nonmajor Governmental Funds .........................................................................76
Schedules of Revenues, Expenditures, and Changes in
Fund Balances - Budget and Actual:
Jail Construction .........................................................................................................................84
Capital Projects..........................................................................................................................85
Health Care................................................................................................................................86
Recorder's Surcharge .................................................................................................................87
Assessor's Surcharge .................................................................................................................88
Public Library ..............................................................................................................................89
School ........................................................................................................................................90
Parks & Recreation.....................................................................................................................91
Water Advisory Committee .........................................................................................................92
Landfill / Environment .................................................................................................................93
CDBG.........................................................................................................................................94
Improvement Districts .................................................................................................................95
Clerk of Superior Court ...............................................................................................................96
County Attorney ..........................................................................................................................97
Law Enforcement.......................................................................................................................98
Probation..................................................................................................................................100
Courts ......................................................................................................................................101
Public Defender ........................................................................................................................102
Jail District Debt Service...........................................................................................................103
Coyote Springs .........................................................................................................................104
Prescott East............................................................................................................................105
Granite Gardens .......................................................................................................................106
Pine Valley ...............................................................................................................................107
HELP........................................................................................................................................108
Capital Assets Used in the Operation of Governmental Funds:
Comparative Schedules By Source...............................................................................................109
Schedule By Function and Activity ................................................................................................110
Schedule of Changes By Function and Activity.............................................................................111
YAVAPAI COUNTY
Comprehensive Annual Financial Report
Year Ended June 30, 2004
iii
STATISTICAL SECTION
General History:
General Government Expenditures by Function.................................................................................113
General Government Revenues by Source ........................................................................................114
Assessed and Estimated Actual Value of Taxable Property...............................................................115
Taxes and Assessments:
Property Tax Levies and Collections...................................................................................................116
Property Tax Rates-All Direct and Overlapping Governments ...........................................................117
Special Assessment Billings and Collections......................................................................................118
Long-Term Debt:
Computation of Legal Debt Margin .....................................................................................................119
Computation of Direct and Overlapping Debt .....................................................................................120
Miscellaneous:
Principal Taxpayers............................................................................................................................121
Salaries of Elected County Officials ....................................................................................................122
Schedule of Insurance in Force ..........................................................................................................123
Demographic and Other Statistical Data.............................................................................................124
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INTRODUCTORY SECTION
Yavapai County Finance Department
MICHAEL S. DANOWSKI, CPA FINANCE DIRECTOR
1
November 3, 2004
To the Board of Supervisors, and Citizens of Yavapai county:
State law requires that counties prepare a complete set of financial statements presented in
conformity with generally accepted accounting principles (GAAP) and audited in accordance
with generally accepted auditing standards by the Arizona State Auditor General’s Office or by a
firm of licensed certified public accountants. Pursuant to that requirement, we hereby issue the
comprehensive annual financial report of Yavapai County for the fiscal year ended June 30,
2004.
This report consists of management’s representations concerning the finances of Yavapai
County. Consequently, management assumes full responsibility for the completeness and
reliability of all of the information presented in this report. To provide a reasonable basis for
making these representations, management of the County has established a comprehensive
internal control framework that is designed both to protect the government’s assets from loss,
theft, or misuse and to compile sufficient reliable information for the preparation of the County’s
financial statements in conformity with GAAP. Because the cost of internal controls should not
outweigh their benefits, the County’s Comprehensive framework of internal controls has been
designed to provide reasonable rather than absolute assurance that the financial statements will
be free from material misstatement. As management, we assert that, to the best of our
knowledge and belief, this financial report is complete and reliable in all material respects.
Walker & Armstrong LLP, a firm of licensed certified public accountants, have audited the
County’s financial statements. The goal of the independent audit was to provide reasonable
assurance that the financial statements of the County for the fiscal year ended June 30, 2004,
are free of material misstatement. The independent audit involved examining, on a test basis,
evidence supporting the amounts and disclosures in the financial statements; assessing the
accounting principles used and significant estimates made by management; and evaluating the
overall financial statement presentation. The independent auditor concluded, based upon the
audit; that there was a reasonable basis for rendering an unqualified opinion that the Yavapai
County financial statements for the fiscal year ended June 30, 2004, are fairly presented in
conformity with GAAP. The independent auditor’s report is presented as the first component of
the financial section of this report.
The independent audit of the financial statements of the County was part of a broader, federally
mandated “Single Audit” designed to meet the special needs of federal grantor agencies. The
standards governing Single Audit engagements require the independent auditor to report not
only on the fair presentation of the financial statements, but also on the audited government’s
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internal controls and compliance with legal requirements, with special emphasis on internal
controls and legal requirements involving the administration of federal awards. These reports
are available in the County’s separately issued Single Audit report.
GAAP require that management provide a narrative introduction, overview, and analysis to
accompany the basic financial statements in the form of Management’s Discussion and Analysis
(MD&A). This letter of transmittal is designed to complement MD&A and should be read in
conjunction with it. The County’s MD&A can be found immediately following the report of the
independent auditors.
Profile of the Government
Yavapai County was formed in 1864; one year after the Arizona Territory was established. The
County was named after the Yavapai tribe, whose name means “people of the sun”. The
County is located in the central portion of the state encompassing approximately 8,125 square
miles.
The County is empowered to levy a property tax on both real and personal properties within its
boundaries.
The County operates under the supervisor-administrator form of government. Policy-making
and legislative authority are vested in a board of supervisors (Board) consisting of three
members. The Board appoints an Administrator, who is responsible for overseeing the day-to–
day operations of the government. The Board consists of three members elected to four-year
terms representing three supervisorial districts.
The Board is responsible the financing and administration of County government, has final
approval over County departmental budgets and sets property tax rates. As part of its
administrative duties, the Board is responsible for appointing department heads, and members
of County boards and commissions dealing with planning and zoning, building codes, health,
employees and employee benefits, private industry and agriculture. The Board acts as the
board of directors for special districts within the County such as jail, water, sanitation, lighting,
library and flood control.
The County Administrator develops and presents the County budget, oversees countywide
administrative departments, assists elected officials, and coordinates with other governments in
intergovernmental relations.
In addition to the Board, other elected officers representing the County include the Assessor,
Clerk of the Superior Court, County Attorney, Recorder, School Superintendent and the
Treasurer. There are six elected Superior Court Judges, and five Justices of the Peace.
Yavapai County provides a full range of services, including police protection, courts, health
services, the construction and maintenance of highways, streets, other infrastructure and parks.
The financial reporting entity includes all the funds and account groups of the primary
government (Yavapai County), as well as its’ component units. Component units are legally
separate entities for which the primary government is financially accountable. The Board acts
as the Board of Directors of these component units. Accordingly, the Yavapai County Flood
Control District, Library District and various special assessment districts are reported as a part
3
of the governmental fund types of the primary government.
There are various school districts, special districts, and fire districts within Yavapai County
governed by independently elected boards. The financial statements of such districts are not
included in this report except to reflect amounts held in an agency capacity by the County
Treasurer. The reporting entity is further described in Note 1 to the financial statements.
The annual budget serves as the foundation for the County’s financial planning and control. All
departments of the County are required to submit requests for appropriation to the County
Administrator annually. These requests are used as the starting point for developing a
proposed budget. The County Administrator then presents this proposed budget to the Board of
Supervisors for review on or before the third Monday in July. On or before the seventh day
before the day in August when the Board sets tax levy rates, the Board must hold a public
hearing and a special meeting of the Board, at which time the final budget must be adopted.
The final budget is adopted by fund and department. Transfers of appropriations between funds
or departments require approval of the Board. Budget-to-actual comparisons are provided in
this report for each individual governmental fund for which an appropriated annual budget has
been adopted. For the general fund and major special revenue funds this comparison is
presented beginning on page 58 as part of the required supplemental information. For
governmental funds, other than the general fund and major special revenue funds with
appropriated annual budgets, this comparison is presented in the governmental fund subsection
of this report, which starts on page 84.
Factors Affecting Financial Condition
The information presented in the financial statements is perhaps best understood when it is
considered from the broader perspective of the specific environment within which the County
operates.
Local Economy. Yavapai County has experienced rapid population growth in recent years,
increasing 55% to a total of 167,517, from the 1990 to the 2000 census. This rate makes Yavapai
County one of the fastest growing counties in the State of Arizona. This is exemplified by Yavapai
County’s strong residential construction activity.
The unemployment rate is 3.3% compared to the statewide average of 5.6%. Yavapai County
Government is the single largest employer in Yavapai County.
Retail trade, tourism, utilities, healthcare, warehouse and distribution centers, mining, light
industry and government all contribute to the economy.
Long-term financial planning. In November of 1999, the Yavapai County Jail District was
formed when the citizens approved a dedicated excise tax of up to 1/4 cent for the purpose of
constructing, operating, maintaining and financing County jail facilities. In December of 1999,
the Board adopted Resolution No.1999-1 establishing the initial excise tax of 1/5 cent. On March
26, 2003, the excise tax was raised to the voter approved rate of 1/4 cent.
The excise tax has been used to construct new, efficient jail facilities and to pay for additional
staff and other operating costs of the jail system. The first phase of the jail construction was to
increase the size of the Camp Verde Jail Facility by 480 beds. Construction of this phase began
in January of 2002 and was completed in the fall of 2003. Total cost was approximately $20
4
million. Pledged revenue obligations in the amount of $15,260,000 were issued to finance the
majority of the construction costs. Some of the original detention space in the Camp Verde Jail
Facility has been converted into a remanded juvenile facility. This facility has a capacity of
approximately 44 beds and is both sight and sound separate from the adult facility. Grants from
the State of Arizona in excess of $1.4 million were used to finance the majority of design and
construction costs.
Phase two of the construction program, which would begin within the next five years, anticipates
the construction of a new jail facility in western Yavapai County. Upon its completion, the
current Prescott Facility would be taken out of service and converted to other uses due to its
outmoded design and poor location.
Cash management policies and practices. Cash temporarily idle during the year was
invested in obligations of the U.S. Treasury, the Arizona State Treasurer’s investment pool,
specified state and local government bonds, and interest-earning investments such as savings
accounts, certificates of deposit and repurchase agreements in eligible depositories. The
average yield on investments for the fiscal year ended 2004 was 2.25 percent.
Risk management. The County is covered by three public entity risk pools: the Arizona
Counties Property and Casualty Pool: the Arizona Counties Worker’s Compensation Pool, and
the Yavapai Combined Trust. Additional information on the County’s risk management activity
can be found in Note 13 of the notes to the financial statements.
Pension. The County participates in four retirement plans: The Arizona State Retirement
System, the Public Safety Personnel Retirement System, the Correctional Officer Retirement
Plan and the Elected Officials Retirement Plan. Note 15 of the notes to financial statements
contain Information about the types of employees covered, the County’s liability, and general
information about the individual plans.
Government Finance Officers Association
The Government Finance Officers Association of the United States and Canada (GFOA)
awarded a Certificate of Achievement for Excellence in Financial Reporting to Yavapai County
for its comprehensive annual financial report for the fiscal year ended June 30, 2003. In order
to be awarded a Certificate of Achievement, a government must publish an easily readable and
efficiently organized comprehensive annual 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.
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7
YAVAPAI COUNTY
Organizational Chart
CITIZENS OF YAVAPAI COUNTY
ASSESSOR
CLERK OF SUPERIOR
COURT
ATTORNEY
SUPERIOR
COURT
RECORDER
BOARD OF
SUPERVISORS
SCHOOL
SUPERINTENDENT
JUSTICE
COURTS
TREASURER SHERIFF CONSTABLES
ELECTIONS
CLERK OF
BOARD
COUNTY
ADMINISTRATOR
ADULT
PROBATION
JUVENILE
PROBATION
FINANCE HUMAN
RESOURCES
PUBLIC
WORKS
HEALTH
LIBRARY MEDICAL
ASSISTANCE
DEVELOPMENT
SERVICES
BOARD
COUNSEL
FLEET FACILITIES
MANAGEMENT
INFORMATION SYSTEMS
PUBLIC
DEFENDER
RECORDS PUBLIC FIDUCIARY
MANAGEMENT
8
Yavapai County Officials
BOARD OF SUPERVISORS
Gheral Brownlow, Member, District 1
Lorna Street, Member, District 2
A.G. “Chip” Davis, Chairman, District 3
♦ ♦ ♦
CLERK OF THE BOARD
Bev Staddon
♦ ♦ ♦
COUNTY ADMINISTRATOR
James M. Holst
♦ ♦ ♦
FINANCE DIRECTOR
Michael S. Danowski
FINANCIAL SECTION
Yavapai County
Management’s Discussion and Analysis
11
As management of Yavapai County, we offer readers of Yavapai County’s financial statements this
narrative overview and analysis of the financial activities of Yavapai County for the fiscal year ended June
30, 2004. 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 1 – 5.
Financial Highlights
• The assets of Yavapai County exceeded its liabilities at the close of the most recent fiscal year by
$113,061,122 (net assets). Of this amount, $20,105,196 (unrestricted net assets) may be used to meet
the government’s ongoing obligations to citizens and creditors.
• As of the close of the current fiscal year, Yavapai County’s governmental funds reported combined
ending fund balances of $28,857,806 a decrease of $3,930,210 in comparison with the prior year.
• At the end of the current fiscal year, unreserved fund balance for the general fund was $1,863,405 or
3% of total general fund expenditures.
• Yavapai County’s total long-term liabilities decreased by $3,514,515 during the current fiscal year. The
key factors in this decrease were the scheduled repayment of notes payable and the retirement of
special assessment and jail revenue bond debt.
Overview of the Financial Statements
This discussion and analysis are intended to serve as an introduction to Yavapai County’s basic financial
statements. Yavapai County’s basic financial statements comprise three components: 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 Yavapai County’s finances, in a manner similar to a private sector
business.
The statement of net assets presents information on all of Yavapai County’s assets and liabilities, with the
difference between the two reported as net assets. Over time, increases or decreases in net assets may
serve as a useful indicator of whether the financial position of Yavapai County is improving or deteriorating.
The statement of activities presents information showing how the government’s net assets changed during
the most recent fiscal year. All changes in net assets 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 taxes and earned but unused paid-time-off leave).
Both of the government-wide financial statements distinguish functions of Yavapai 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 Yavapai County include general government, public safety, highways and
streets, health, welfare and sanitation, culture and recreation, and education. The Yavapai Long-Term
Care Division comprises the business-type activities of Yavapai County.
Yavapai County
Management’s Discussion and Analysis
12
The government-wide financial statements not only include Yavapai County itself (known as the primary
government), but also a legally separate Jail District, Flood Control District, Library District and various
Special Assessment Districts. These districts function for all practical purposes as departments of Yavapai
County, and therefore have been included as an integral part of the primary government.
The government-wide financial statements can be found on pages 21 - 22 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. Yavapai 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 Yavapai 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, the governmental funds 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 financing decisions.
Both the governmental funds 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.
Yavapai County maintains numerous individual governmental funds. Information is presented separately in
the governmental funds balance sheet and in the governmental funds statement of revenues, expenditures,
and changes in fund balances for six funds considered to be major funds. Data from the other
governmental funds are combined into a single, aggregated presentation. Individual fund data for each of
these non-major governmental funds is provided in the form of combining statements elsewhere in this
report.
The basic governmental fund financial statements can be found on pages 24 - 30 of this report.
Proprietary funds. Yavapai County maintains one type of proprietary fund. Enterprise funds are used to
report the same functions presented as business-type activities in the government-wide financial
statements. Yavapai County uses an enterprise fund to account for its Arizona Long-Term Health Care
Division.
The basic proprietary fund financial statements can be found on pages 31 - 33 of this report.
Fiduciary Funds. Fiduciary funds are used to account for resources held for the benefit of parties outside
the government. Fiduciary funds are not reflected in the government-wide financial statements because the
resources of those funds are not available to support Yavapai County’s own programs. The accounting
used for fiduciary funds is much like that used for proprietary funds.
The basic fiduciary funds financial statements can be found on pages 34 - 35 of this report.
Yavapai County
Management’s Discussion and Analysis
13
Notes to the financial statements. The notes provide additional information that is essential to the 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 36 - 55 of this report.
Other information. In addition to the basic financial statements and accompanying notes, this report also
presents certain required supplementary information concerning Yavapai County’s progress in funding its
obligation to provide pension benefits to its employees and budgetary comparison schedules for the
general fund and major special revenue funds. Other required supplementary information can be found on
pages 57 - 63 of this report.
The combining statements referred to earlier in connection with non-major governmental funds are
presented immediately following the required supplementary information. Combining and individual fund
statements and schedules can be found on pages 68 - 108 of this report.
Government-wide Financial Analysis
Statement of Net Assets. As noted earlier, net assets may serve over time as a useful indicator of a
government’s financial position. In the case of Yavapai County, assets exceeded liabilities by $113 million
at the close of the most recent fiscal year.
Net Assets
(in millions)
Governmental Business-type
Activities Activities Total
2004 2003,
as
restated
2004 2003 2004 2003,
as
restated
Current and other assets $ 40.0 $ 43.1 $ 6.9 $ 7.8 $ 46.9 $ 50.9
Restricted assets 1.9 1.4 1.9 1.4
Capital assets 110.4 95.5 .1 .1 110.5 95.6
Total assets 152.3 140.0 7.0 7.9 159.3 147.9
Long-term liabilities outstanding 30.0 33.6 30.0 33.6
Other liabilities 12.1 10.7 4.2 3.8 16.3 14.5
Total liabilities 42.1 44.3 4.2 3.8 46.3 48.1
Net assets:
Invest in capital assets, net of related debt 89.6 70.8 .1 .1 89.7 70.9
Restricted .5 .2 2.7 4.0 3.2 4.2
Unrestricted 20.1 24.7 20.1 24.7
Total net assets $ 110.2 $ 95.7 $ 2.8 $ 4.1 $ 113.0 $ 99.8
By far the largest portion of Yavapai County’s net assets (80%) reflects its investment in capital assets (e.g.
land, buildings, machinery and equipment), less any related debt and accumulated depreciation used to
acquire those assets that is still outstanding. Yavapai County uses these capital assets to provide services
to citizens; consequently, these assets are not available for future spending. Although Yavapai County’s
investment in its capital assets is reported net of related debt, it should be noted that the resources needed
to repay this debt must be provided from other sources, since the capital assets themselves cannot be
used to liquidate these liabilities.
Approximately 3% of Yavapai County’s net assets represent resources that are subject to external
Yavapai County
Management’s Discussion and Analysis
14
restrictions on how they may be used. The remaining balance of unrestricted net assets ($20 million) may
be used to meet the government’s ongoing obligations to citizens and creditors.
At the end of the current fiscal year Yavapai County is able to report positive balances in all three
categories of net assets, both for the government as a whole, as well as for its separate governmental and
business-type activities.
The increase in total net assets, related to governmental activities, is primarily due to increases in program
revenues. Restricted net assets decreased by $1 million, primarily due to less than expected revenue
increases in the business-type activities. This is not expected to continue or have any adverse affects on
future operations. The decrease in unrestricted net assets of $4.6 million is due to the completion of a
major road project in the governmental activities.
Statement of Activities. Already noted was the statement of activities purpose in presenting information
in how the government's net assets changed during the most recent fiscal year. A chart of changes in net
assets follows. For the fiscal year, net assets increased $13.1 million, all coming from governmental
activities. The increase in assets in governmental activities is related to the construction of assets, rather
than accumulation of cash or other liquid assets. The basis of accounting used in the government-wide
statement of activities excludes capital expenditures while its revenues include taxes that are used, in part,
for the construction of those assets. Beginning net assets have been restated due to the recording of
previously unrecorded infrastructure. Additional information on this restatement can be found on page 45.
Changes in Net Assets
(in millions)
Governmental Business-type
Activities Activities Total
2004 2003 2004 2003 2004 2003
Revenues
Program revenues:
Charges for services $ 13.8 $ 13.0 $ 31.5 $ 30.4 $ 45.3 $ 43.4
Grants and contributions 26.8 24.5 26.8 24.5
General revenues:
Property taxes 31.9 28.1 31.9 28.1
Sales taxes 35.7 32.8 35.7 32.8
Vehicle license tax 9.5 8.3 9.5 8.3
Miscellaneous 5.1 4.2 5.1 4.2
Total revenues 122.8 110.9 31.5 30.4 154.3 141.3
Expenses
General government 38.0 42.2 38.0 42.2
Public safety 31.7 26.7 31.7 26.7
Highways and streets 18.4 11.0 18.4 11.0
Sanitation 1.6 1.6 1.6 1.6
Health 8.8 5.7 8.8 5.7
Welfare 7.8 8.3 7.8 8.3
Culture and recreation .5 .6 .5 .6
Education 2.6 1.7 2.6 1.7
Long-term care 31.8 28.3 31.8 28.3
Total expenses 109.4 97.8 31.8 28.3 141.2 126.1
Increase (decrease) in net assets before transfers 13.4 13.1 (.3) 2.1 13.1 15.2
Transfers 1.0 2.0 (1.0) (2.0)
Increase (decrease) in net assets 14.4 15.1 (1.3) .1 13.1 15.2
Net assets, beginning restated 95.8 80.7 4.1 4.0 99.9 84.7
Net assets, ending $ 110.2 $ 95.8 $ 2.8 $ 4.1 113.0 $ 99.9
Yavapai County
Management’s Discussion and Analysis
15
Governmental activities.
Governmental activities revenues totaled $122.8 million for fiscal year 2004. The following are highlights of
County revenues:
• Sales taxes are comprised of state shared-sales tax, a 0.5% tax for highways and a 0.25% Jail
District tax. Overall sales tax increased by $2.9 million approximately (9%) in the current fiscal
year due to a general increase in sales activity, fueled by an improving local economy and
continued population growth. In addition, the Jail District tax rate was increased from 0.020% to
0.025%, which resulted in increases of approximately 38% in the Jail District tax revenues. The
highway sales tax increased by $1 million and the state-shared sales tax, the largest component of
sales tax, remained the same at $16.9 million, although actual collections exceeded the prior year
by $1 million, however Arizona law requires this to be recognized in fiscal year 2004/05. Based
upon the Arizona State Department of Revenue projections, it is expected that State-shared sales
tax will show a similar increase in fiscal year 2004/05.
• Property taxes increased by $3.8 million (13.7%) during the year. This increase is attributable to
increased property values, new construction and a 4.5% increase in the property tax rate.
• Charges for services increased by $1.9 million primarily from increases in building and related
permits, County Recorder and Assessor fees, which is indicative of increased building and real
estate sales activity.
Revenues by Source - Governmental Activities
Sales taxes
28%
Vehicle license tax
8%
Charges fo r
services
11%
Operating grants
and co ntributio ns
22%
Transfers
1%
Property taxes
26%
M iscellaneo us
4%
Yavapai County
Management’s Discussion and Analysis
16
Expenses
For the most part, increases in expenses closely paralleled inflation and growth in the demand for services.
The general government function experienced significant growth in the General Services, County Attorney,
Superior Court, Public Defender and Facilities departments. Increases, over the prior year, in public safety
are the result of increasing demands on law enforcement and detention within the Sheriff’s office. The
increase in highways and streets is the result of the completion of a major road project.
Expenses and Program Revenues - Governmental Activities
-
5.0
10.0
15.0
20.0
25.0
30.0
35.0
40.0
General
go vernment
Public safety Highways
and streets
Sanitatio n Health Welfare Culture and
recreatio n
Educatio n
$ In Millions
Expenses Program Revenues
Business-type activities Business-type activities consist solely of the Yavapai County Department of
Medical Assistance, Long-Term Health Care Division (“Division”). The Division operates a prepaid health
program for qualified persons of Yavapai County within the State of Arizona. The Program provides
hospitalization, medical care, managed institutional care, and home and community based long-term care
for physically disabled and elderly persons. The funds used to carry out the Division’s program are
provided by the State of Arizona under its Arizona Long-Term Care System administered by the Arizona
Health Care Cost Containment System (AHCCCS). The funding sources include federal, state and county
monies that are paid to the Division on a capitation basis.
Yavapai County
Management’s Discussion and Analysis
17
Capitation revenues increased by $1.1 million, or 3.6%, for fiscal year 2004 over the prior fiscal year.
Operating expenses increased $3.5 million representing a 12.4% change from the prior year. These
increases are the direct result of an increase in client membership and an increase in provider service
costs.
Expenses and Program Revenues-Business-type Activities
-
5.0
10.0
15.0
20.0
25.0
30.0
35.0
$ In Millions
Expenses Program Revenues
Financial Analysis of the Government’s Funds
As noted earlier, Yavapai County uses fund accounting to ensure and demonstrate compliance with
finance-related legal requirements.
Governmental funds. The focus of Yavapai County’s governmental funds is to provide information on
near-term inflows, outflows, and balances of spendable resources. Such information is useful in assessing
Yavapai County’s financing requirements. In particular, unreserved fund balance may serve as a useful
measure of a government’s net resources available for spending at the end of the fiscal year.
As of the end of the current fiscal year, Yavapai County’s governmental funds reported combined ending
fund balances of 28,857,806, a decrease of $3,930,210 in comparison with the prior year. This change is
primarily attributable to the decrease in the fund balance of the capital projects fund and the HURF road
fund, as the county completed a new Health facility at a cost of $2 million in the capital projects fund and
finished a significant number of projects in the road fund. The fund balance is unreserved other than the
reserves for inventories of $266,377, debt service of $453,070 and capital acquisition of $308,643.
Yavapai County
Management’s Discussion and Analysis
18
The general fund is the chief operating fund of Yavapai County. At the end of the current fiscal year,
unreserved fund balance of the general fund was $1,863,405, which was $78,412 more than the previous
fiscal year. Otherwise both revenues and expenditures for the current fiscal year closely followed
estimates.
Proprietary fund. Yavapai County’s proprietary funds provide the same type of information found in the
government-wide financial statements, but in more detail. Restricted net assets of the Long-Term Care
Division at the end of the year amounted to $2.8 million, a decrease of $1.3 million over the prior fiscal
year. This decrease is primarily due to a fixed capitation amount received from the AHCCCS, which was
less than what was necessary to keep pace with the rise in long-term care expenses. This situation is not
expected to have a lasting effect. Other factors concerning the finances of this fund have already been
addressed in the discussion of Yavapai County’s business-type activities.
General Fund Budgetary Highlights
The general fund expenditure budget of $57,224,517 was reduced by transfers of $165,862 to other funds.
In addition, certain departments received supplemental appropriations as follows:
Public Defender $ 362,918
Superior Courts 79,210
County Attorney 70,422
Records Management 62,720
Juvenile Probation 15,461
Voter Registration 12,435
Clerk of the Court 2,120
These increases in appropriations were transferred from other general fund departments with budget
capacity. Actual general fund expenditures were under budget by $1,372,468.
During the year, actual revenue exceeded estimates by $1,165,568 or 1.9%.
Capital Asset and Debt Administration
Capital Assets. Yavapai County’s investment in capital assets for its governmental and business-type
activities as of June 30, 2004, amounts to $89.7 million (net of accumulated depreciation and related debt).
This investment in capital assets includes land, buildings, machinery and equipment. In addition, roads
and highways constructed in the fiscal year ended June 30, 2004, or in progress at that date, are included
in capital assets. In accordance with GASB Statement No. 34, the County will retroactively value all
infrastructure assets back to fiscal year 1981 by June 30, 2006. The total increase in Yavapai County’s
investment in capital assets for the current fiscal year was 23%, nearly all of which is attributed to
governmental activities.
Major capital asset events during the current fiscal year included the following:
• Construction was completed on the Camp Verde Jail Facility. Total costs incurred to date are less
than projected costs of $20 million, allowing for expansion of the sewage plant if necessary.
Capacity of the facility has increased by 480 beds.
• Construction was completed on Health Building in Prescott. The new facility was opened in April
2004 and is nearly double the size of the old facility.
Yavapai County
Management’s Discussion and Analysis
19
Yavapai County’s Capital Assets
(net of depreciation)
(in millions)
Governmental Business-type
Activities Activities Total
2004 2003 2004 2003 2004 2003
Land $ 11.7 $ 9.5 $ $ $ 11.7 $ 9.5
Buildings 47.2 26.5 47.2 26.5
Machinery and Equipment 10.2 9.1 .2 .1 10.4 9.2
Infrastructure 29.1 10.1 29.1 10.1
Construction in Progress 12.1 34.2 12.1 34.2
Total $ 110.3 $ 89.4 $ .2 $ .1 110.5 $ 89.5
Additional information on Yavapai County’s capital assets can be found in Note 4 on pages 44 - 45 of this
report.
Long-term debt. At the end of the current fiscal year, Yavapai County had total bonded debt outstanding
of $14,310,154. Of this amount, $12,595,000 represents pledged revenue obligations of the Yavapai
County Jail District, which are secured by a dedicated excise tax of ¼ cent, and $1,715,154 represents debt
of various special assessment districts which is secured by pledges of revenues from special assessments
levied against benefiting property owners. Yavapai County also had notes payable of $6,375,000 which
are secured by the County’s highway user revenue. The remainder of Yavapai County’s debt is a long-term
capital lease of $1,753,789 road equipment.
Yavapai County’s Outstanding Debt
(in millions)
2004 2003
Jail District Pledged Revenue Obligations $ 12.6 $ 13.9
Special Assessment Debt Payable 1.7 1.8
Notes Payable 6.4 8.8
Capital Leases 1.7 1.5
Total $ 22.4 $ 26.0
Yavapai County’s debt decreased by a net $3,653,941 during the current fiscal year. The pledged revenue
obligations are being used to construct new jail facilities, also mentioned above. Moody’s Investor Service
and Standard & Poor’s Rating services have assigned the ratings of “Aaa” and “AAA”, respectively, on
these obligations, which are insured for the payment of principal and interest with Ambac Assurance,
Ambac Financial Group, Inc.
State statutes limit the amount of general obligation debt a county may issue to 6 percent of its total
assessed valuation. The current debt limitation for the County is $100,561,772. Since the County has no
general obligation debt, this amount equals the debt capacity. Additional information on long-term debt can
be found in the Notes to the Financial Statements on pages 46-48 of this report.
Yavapai County
Management’s Discussion and Analysis
20
Economic Factors and Next Year’s Budgets and Rates
• The unemployment rate for Yavapai County is currently 3.3 percent, which is a slight decrease from a
rate of 3.4 percent a year ago. This compares favorably to the state’s average unemployment rate of
5.9 percent.
• Inflationary trends in the region compare favorably to national indices.
These factors were considered in preparing Yavapai County’s budget for the 2004/05 fiscal year. The
unreserved ending fund balance in the general fund of $1,863,405 was appropriated for spending in the
2004/05 fiscal year budget. The increased need for detention and court services necessitated a 1%
increase in the general fund property tax rate for the 2004/05 fiscal year.
Requests for Information
This financial report is designed to provide a greater overview of Yavapai 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 the Finance Department,
1015 Fair Street, Prescott, Arizona 86305.
BASIC FINANCIAL STATEMENTS
See accompanying notes to financial statements.
21
Yavapai County
Statement of Net Assets
June 30, 2004
Primary Government
Governmental Business-type
Assets Activities Activities Total
Cash and investments held by treasurer $ 29,783,055 $ 5,479,247 $ 35,262,302
Receivables:
Property taxes 1,501,158 - 1,501,158
Special assessments 1,043,471 - 1,043,471
Accounts 860,967 - 860,967
Due from other governments 6,415,187 1,403,274 7,818,461
Inventories 266,377 - 266,377
Prepaid items 48,364 - 48,364
Deferred charges 150,621 - 150,621
Cash equivalents - restricted 1,916,488 - 1,916,488
Capital assets, not being depreciated 23,816,665 - 23,816,665
Capital assets, being depreciated, net 86,547,442 174,128 86,721,570
Total assets 152,349,795 7,056,649 159,406,444
Liabilities
Accounts payable 5,094,438 325,613 5,420,051
Accrued payroll and employee benefits 2,096,153 216,915 2,313,068
Matured bonds payable 1,350,000 - 1,350,000
Interest payable 257,845 - 257,845
Due to other governments - 92,569 92,569
Medical claims payable - 3,559,014 3,559,014
Deferred revenue 3,282,376 - 3,282,376
Noncurrent liabilities:
Due within one year 11,059,747 - 11,059,747
Due in more than one year 19,010,652 - 19,010,652
Total liabilities 42,151,211 4,194,111 46,345,322
Net Assets
Invested in capital assets, net of related debt 89,640,318 174,128 89,814,446
Restricted for:
Health and welfare - 2,688,410 2,688,410
Debt service 453,070 - 453,070
Unrestricted 20,105,196 - 20,105,196
Total net assets $ 110,198,584 $ 2,862,538 $ 113,061,122
See accompanying notes to financial statements.
22
Yavapai County
Statement of Activities
Year Ended June 30, 2004
Program Revenues Net (Expenses) Revenue & Changes in Net Assets
Charges Operating Capital Primary Government
for Grants & Grants & Governmental Business-type
Functions/Programs Expenses Services Contributions Contributions Activities Activities Total
Primary Government:
Governmental activities:
General government $ 37,084,422 $ 6,123,424 $ 4,288,044 $ - $ (26,672,954) $ - $ (26,672,954)
Public safety 31,704,296 3,104,336 5,090,701 - (23,509,259) - (23,509,259)
Highways and streets 18,457,819 1,500,511 10,448,393 138,290 (6,370,625) - (6,370,625)
Sanitation 1,645,392 447,163 880,410 - (317,819) - (317,819)
Health 8,757,816 2,339,512 4,905,502 - (1,512,802) - (1,512,802)
Welfare 7,844,530 - - - (7,844,530) - (7,844,530)
Culture and recreation 556,472 - 192,878 - (363,594) - (363,594)
Education 2,546,712 263,752 855,140 - (1,427,820) - (1,427,820)
Aid to other governments 146,641 - 25,724 - (120,917) - (120,917)
Interest on long-term debt 923,764 - - - (923,764) - (923,764)
Total governmental activities 109,667,864 13,778,698 26,686,792 138,290 (69,064,084) - (69,064,084)
Business-type activities:
Long term care 31,832,400 31,465,598 - - - (366,802) (366,802)
Total business-type activities 31,832,400 31,465,598 - - - (366,802) (366,802)
Total primary government $ 141,500,264 $ 45,244,296 $ 26,686,792 $ 138,290 (69,064,084) (366,802) (69,430,886)
General revenues:
Property taxes 31,940,611 - 31,940,611
Sales taxes 35,700,324 - 35,700,324
Vehicle license tax 9,495,550 - 9,495,550
Franchise taxes 498,553 - 498,553
State shared lottery 550,035 - 550,035
Interest on investments 252,347 124,413 376,760
Miscellaneous 4,037,390 54,043 4,091,433
Transfers 1,000,000 (1,000,000) -
Total general revenues and transfers 83,474,810 (821,544) 82,653,266
Changes in net assets 14,410,726 (1,188,346) 13,222,380
Net assets – beginning, as restated 95,787,858 4,050,884 99,838,742
Net assets - ending $ 110,198,584 $ 2,862,538 $ 113,061,122
23
This page is left blank intentionally.
See accompanying notes to financial statements.
24
Yavapai County
Balance Sheet
Governmental Funds
June 30, 2004
Jail Jail District
Assets General Jail District Construction Debt Service
Cash and cash equivalents $ 2,341,315 $ 4,156,181 $ - $ 257,845
Receivables:
Property taxes 1,248,875 - - -
Special assessments - - - -
Accounts 272,137 20,207 - -
Due from:
Other funds 373,975 259,839 725 -
Other governments 2,774,795 701,786 - -
Inventories 91,724 - - -
Prepaid items 42,340 - - -
Cash equivalents - restricted - - - 1,607,845
Total assets $ 7,145,161 $ 5,138,013 $ 725 $ 1,865,690
Liabilities and Fund Balances
Liabilities:
Accounts payable $ 995,354 $ 476,187 $ 50,438 $ -
Accrued payroll and employee benefits 1,156,624 254,398 - -
Due to other funds 51,357 438 - 257,845
Interest payable - - - 257,845
Principal payable - - - 1,350,000
Deferred revenue 2,986,697 - - -
Total liabilities 5,190,032 731,023 50,438 1,865,690
Fund balances:
Reserved for:
Debt service - - - -
Capital acquisition - - - -
Inventory 91,724 - - -
Unreserved, reported in
General fund 1,863,405 - - -
Special revenue funds - 4,406,990 - -
Capital project funds - - (49,713) -
Total fund balances 1,955,129 4,406,990 (49,713) -
Total liabilities and fund balances $ 7,145,161 $ 5,138,013 $ 725 $ 1,865,690
25
Other Total
Regional Capital Governmental Governmental
Road HURF Road Projects Funds Funds
$ 7,165,036 $ 708,537 $ 4,778,349 $ 10,375,792 $ 29,783,055
- - - 252,283 1,501,158
- - - 1,043,471 1,043,471
44,767 31,284 4,281 363,111 735,787
1,116 31,371 - 370,452 1,037,478
824,599 1,237,029 - 876,978 6,415,187
- 174,653 - - 266,377
- - - 6,024 48,364
- 308,643 - - 1,916,488
$ 8,035,518 $ 2,491,517 $ 4,782,630 $ 13,288,111 $ 42,747,365
$ 568,689 $ 1,696,416 $ 35,115 $ 1,272,239 $ 5,094,438
5,189 188,634 - 491,308 2,096,153
- 36,554 39,851 526,253 912,298
- - - - 257,845
- - - - 1,350,000
- - - 1,192,128 4,178,825
573,878 1,921,604 74,966 3,481,928 13,889,559
- - - 453,070 453,070
- 308,643 - - 308,643
- 174,653 - - 266,377
- - - - 1,863,405
7,461,640 86,617 - 9,333,136 21,288,382
- - 4,707,664 19,978 4,677,929
7,461,640 569,913 4,707,664 9,806,184 28,857,806
$ 8,035,518 $ 2,491,517 $ 4,782,630 $ 13,288,111 $ 42,747,365
See accompanying notes to financial statements.
26
Yavapai County
Reconciliation of the Governmental Funds Balance Sheet
to the Statement of Net Assets
June 30, 2004
Amounts reported for governmental activities in the statement of net assets
are different because:
Total fund balances - governmental funds $ 28,857,806
Capital assets used in governmental activities are not financial
resources and therefore are not reported in the funds. 110,364,107
Some receivables are not available to pay for current-period
expenditures and, therefore, are deferred in the funds. 896,449
Bond issuance costs are recorded as deferred charges, and are not
reported in the funds. 150,621
Long-term liabilities, including bonds payable, are not due and
payable in the current period and, therefore, are not reported in the
funds. (30,070,399)
Net assets of governmental activities $ 110,198,584
27
This page is left blank intentionally.
See accompanying notes to financial statements.
28
Yavapai County
Statement of Revenues, Expenditures, and Changes in Fund Balances
Governmental Funds
Year Ended June 30, 2004
Jail Jail District
General Jail District Construction Debt Service
Revenues:
Taxes $ 29,895,412 $ 6,201,641 $ - $ -
Special assessments - - - -
Licenses and permits 2,730,437 - - -
Intergovernmental 25,260,228 - - -
Charges for services 1,570,577 220,425 - -
Fines and forfeits 1,978,124 - - -
Investment income 31,743 55,536 840 -
Miscellaneous 1,428,749 300,014 - -
Total Revenues 62,895,270 6,777,616 840 -
Expenditures:
Current:
General government 35,290,224 - - -
Public safety 11,921,571 10,416,842 - -
Highways and streets - - - -
Sanitation - - - -
Health - - - -
Welfare 7,950,410 - - -
Education 523,982 - - -
Culture and recreation - - - -
Capital expenditures - - 3,671,859 -
Debt service:
Principal retirement - - - 1,350,000
Interest and fiscal charges - - - 517,322
Total Expenditures 55,686,187 10,416,842 3,671,859 1,867,322
Excess (deficiency) of revenues
over (under) expenditures 7,209,083 (3,639,226) (3,671,019) (1,867,322)
Other financing sources (uses):
Transfers in 2,399,846 7,407,000 2,709,737 1,811,465
Transfers out (9,530,517) (4,521,202) - -
Capital leases - - - -
Total other financing sources (uses) (7,130,671) 2,885,798 2,709,737 1,811,465
Net changes in fund balances 78,412 (753,428) (961,282) (55,857)
Fund Balances, July 1, 2003 1,784,993 5,160,418 911,569 55,857
Increase in reserve for inventories 91,724 - - -
Fund Balances, June 30, 2004 $ 1,955,129 $ 4,406,990 $ (49,713) $ -
29
Other Total
Regional Capital Governmental Governmental
Road HURF Road Projects Funds Funds
$ 9,447,139 $ - $ - $ 5,582,205 $ 51,126,397
- - - 515,278 515,278
1,500,511 - - 335,566 4,566,514
- 13,816,633 - 14,227,759 53,304,620
- - - 4,631,830 6,422,832
- - - 340,962 2,319,086
43,602 4,215 36,403 80,008 252,347
7,906 433,860 - 2,290,390 4,460,919
10,999,158 14,254,708 36,403 28,003,998 122,967,993
- - - 6,553,650 41,843,874
- - - 8,358,741 30,697,154
9,029,219 15,853,530 - 126,559 25,009,308
- - - 1,514,713 1,514,713
- - - 8,617,007 8,617,007
- - - - 7,950,410
- - - 1,843,871 2,367,853
- - - 444,617 444,617
- - 1,941,642 486,906 6,100,407
- - - 2,560,440 3,910,440
- - - 387,615 904,937
9,029,219 15,853,530 1,941,642 30,894,119 129,360,720
1,969,939 (1,598,822) (1,905,239) (2,890,121) (6,392,727)
- - 274,750 5,063,662 19,666,460
(2,701,735) (600,000) - (1,313,006) (18,666,460)
- 1,300,000 - - 1,300,000
(2,701,735) 700,000 274,750 3,750,656 2,300,000
(731,796) (898,822) (1,630,489) 860,535 (4,092,727)
8,193,436 1,397,942 6,338,153 8,945,648 32,788,016
- 70,793 - - 162,517
$ 7,461,640 $ 569,913 $ 4,707,664 $ 9,806,183 $ 28,857,806
See accompanying notes to financial statements.
30
Yavapai County
Reconciliation of the Statement of Revenues, Expenditures, and Changes
in Fund Balances of Governmental Funds to the Statement of Activities
Year Ended June 30, 2004
Net change in fund balances - total governmental funds $ (4,092,727)
Amounts reported for governmental activities in the statement of
activities are different because:
Governmental funds report capital outlays as expenditures. However, in the
statement of activities the cost of those assets is allocated over their estimated
useful lives and reported as depreciation expense. This is the amount by which
capital outlays exceeded depreciation in the current period.
Capital outlay 19,790,584
Depreciation (4,825,105) 14,965,479
Debt proceeds provide current financial resources to governmental funds, but
issuing debt increases long-term liabilities in the Statement of Net Assets.
Repayment of debt principal is an expenditure in the governmental funds, but the
repayment reduces long-term liabilities in the Statement of Net Assets.
Debt issued or incurred (1,300,000)
Long-term lease principal payments 1,043,501
Principal repaid on bonds and notes 3,910,440 3,653,941
Deferred tax revenues are recognized in the governmental funds only when
available, but are recognized in the Statement of Activities when earned. 110,594
Some expenses reported in the Statement of Activities do not require the use of
current financial resources and, therefore, are not reported as expenditures in
governmental funds. (158,252)
Purchases of inventories are reported as expenditures in the governmental funds
when purchased. However, in the Statement of Activities they are reported as an
expense when consumed. 162,517
In the Statement of Activities, only the gain/loss on the sale or disposal of capital
assets is reported whereas in the governmental funds, the proceeds from the
sale increase financial resources. Thus, the change in net assets differs from the
change in fund balance by the book value of the capital assets sold or disposed
of. (230,826)
Changes in net assets of governmental activities $ 14,410,726
See accompanying notes to financial statements.
31
Yavapai County
Statement of Net Assets
Proprietary Funds
June 30, 2004
Business-type
Activities-
Enterprise Fund
Long-term Care
Assets
Current assets:
Cash and cash equivalents $ 5,479,247
Due from other governments 1,350,744
Due from other funds 52,530
Total current assets 6,882,521
Noncurrent assets:
Capital assets, net of accumulated depreciation 174,128
Total noncurrent assets 174,128
Total Assets 7,056,649
Liabilities
Current liabilities :
Accounts payable 147,903
Accrued payroll and employee benefits 216,915
Medical claims payable 3,559,014
Due to other governments 92,569
Due to other funds 177,710
Total current liabilities 4,194,111
Total Liabilities 4,194,111
Net Assets
Invested in capital assets 174,128
Restricted - health and welfare 2,688,410
Total Net Assets $ 2,862,538
See accompanying notes to financial statements.
32
Yavapai County
Statement of Revenues, Expenses and Changes in Fund Net Assets
Proprietary Funds
Year Ended June 30, 2004
Business-type
Activities-
Enterprise Fund
Long-term Care
Operating revenues:
AHCCCS revenues $ 31,465,598
Miscellaneous 54,043
Total operating revenues 31,519,641
Operating Expenses:
Medical costs 27,778,406
Administrative costs 3,990,613
Depreciation 63,381
Total operating expenses 31,832,400
Operating loss (312,759)
Nonoperating revenues:
Interest income 124,413
Loss before transfers (188,346)
Transfers out (1,000,000)
Decrease in net assets (1,188,346)
Net assets, July 1, 2003 4,050,884
Net assets, June 30, 2004 $ 2,862,538
See accompanying notes to financial statements.
33
Yavapai County
Statement of Cash Flows
Proprietary Funds
Year Ended June 30, 2004
Business-type
Activities-
Enterprise Fund
Long-term Care
Cash flows from operating activities:
Cash received from AHCCCS $ 31,480,110
Cash payments for medical services (26,593,925)
Cash payments for personal services (2,441,386)
Cash payments to other County funds for goods and services (1,151,595)
Cash payments for operating activities (1,329,457)
Net cash used for operating activities (36,253)
Cash flows from noncapital activities:
Cash transferred to general fund (1,000,000)
Cash flows from capital and related financing activities:
Purchase of capital assets (19,426)
Cash flows from investing activities:
Interest on investments 124,413
Net decrease in cash and cash equivalents (931,266)
Cash and cash equivalents, July 1, 2003 6,410,513
Cash and cash equivalents, June 30, 2004 $ 5,479,247
Reconciliation of operating loss to net cash
provided by operating activities:
Operating loss $ (312,759)
Adjustments to reconcile operating loss to net cash used for
operating activities:
Depreciation 63,381
Changes in assets and liabilities:
Increase in due from other governments (39,530)
Increase in accounts payable 186,800
Increase in accrued payroll and employee benefits 32,970
Increase in medical claims payable 32,885
Net cash used for operating activities $ (36,253)
See accompanying notes to financial statements.
34
Yavapai County
Statement of Fiduciary Net Assets
Fiduciary Funds
June 30, 2004
Investment Agency
Trust Fund Fund
Assets
Cash and cash equivalents $ 41,463,716 $ 2,186,697
Total Assets 41,463,716 $ 2,186,697
Liabilities
Deposits held for others - $ 2,186,697
Total Liabilities - $ 2,186,697
Net Assets
Held in trust for investment trust participants $ 41,463,716
See accompanying notes to financial statements.
35
Yavapai County
Statement of Changes in Fiduciary Net Assets
Fiduciary Funds
Year Ended June 30, 2004
Investment
Trust Fund
Additions:
Contributions from participants $ 300,815,940
Investment income 617,931
Total additions 301,433,871
Deductions:
Distributions to participants 304,083,272
Total deductions 304,083,272
Change in net assets (2,649,401)
Net assets, July 1, 2003 44,113,117
Net assets, June 30, 2004 $ 41,463,716
Yavapai County
Notes to Financial Statements
June 30, 2004
36
Note 1 - Summary of Significant Accounting Policies
The accounting policies of Yavapai County conform to generally accepted accounting
principles applicable to governmental units adopted by the Governmental Accounting
Standards Board (GASB).
A. Reporting Entity
The County is a general purpose local government that is governed by a separately
elected board of three county supervisors. The accompanying financial statements
present the activities of the County (the primary government) and its component units.
Component units are legally separate entities for which the County is considered to be
financially accountable. Blended component units, although legally separate entities, are
in substance part of the County’s operations. Therefore, data from these units is
combined with data of the primary government. Discretely presented component units, on
the other hand, are reported in a separate column in the combined financial statements to
emphasize they are legally separate from the County. Each blended component unit
discussed below has a June 30 year-end. The County has no discretely presented
component units.
The following table describes the County’s component units:
Component Unit
Description: Criteria
for Inclusion
Reporting
Method
For Separate
Financial
Statements
Yavapai County
Flood Control
District
A tax-levying district that
provides flood control
systems; County board of
supervisors serves as
board of directors
Blended Not available
Yavapai County
Library District
Provides and maintains
library services for
County’s residents;
County board of
supervisors serves as
board of directors
Blended Not available
Yavapai County
Special
Assessment
District
Constructs or improves
sidewalks, curbs and
gutters, irrigation systems,
and street lighting within
the County; County board
of supervisors serves as
board of directors
Blended Not available
Yavapai County
Notes to Financial Statements
June 30, 2004
37
Yavapai County
Jail District
A tax-levying district that
acquires, constructs,
operates, maintains, and
finances county jails and
jail systems; county board
of supervisors serves as
governing board
Blended Not available
Related Organization - The Sedona-Oak Creek Airport Authority (Authority) was created
for the purpose of developing and promoting transportation and commerce by air in the
State of Arizona, and in particular the development, promotion, and operation of air
transportation facilities and air commerce in and around the Sedona area. In 1971, the
Authority entered into a 60-year lease with Yavapai County to manage and operate the
Sedona Airport facility, which is owned by the County. The Authority is governed by a 13
member Board of Directors approved by the County’s Board of Supervisors. However,
the Authority’s operations are completely separate from the County, and the County is
not financially accountable for the Authority. Therefore, based on the criteria of GASB
Statement No. 14, the financial activities of the Authority have not been included in the
accompanying financial statements.
B. Basis of Presentation
The basic financial statements include both government-wide statements and fund-based
financial statements. The government-wide statements focus on the County as a whole,
while the fund-based financial statements focus on major funds. Each presentation
provides valuable information that can be analyzed and compared between years and
between governments to enhance the usefulness of the information.
Government-wide statements-provide information about the primary government (the
County) and its component units. The statements include a statement of net assets and a
statement of activities. These statements report the financial activities of the overall
government, except for fiduciary activities. They also distinguish between the
governmental and business-type activities of the County. Governmental activities
generally are financed through taxes and intergovernmental revenues. Business-type
activities are financed in whole or in part by fees charged to external parties.
A statement of activities presents a comparison between direct expenses and program
revenues for each function of the County’s governmental activities and segment of its
business-type activities. Direct expenses are those that are specifically associated with a
program or function and, therefore, are clearly identifiable to a particular function. The
County does not allocate indirect expenses to programs or functions. Program revenues
include:
• charges to customers or applicants for good, services, or privileges provided,
• operating grants and contributions, and
• capital grants and contributions, including special assessments.
Yavapai County
Notes to Financial Statements
June 30, 2004
38
Revenues that are not classified as program revenues, including internally dedicated
resources and all taxes, are reported as general revenues.
Generally, the effect of interfund activity has been eliminated from the government-wide
financial statements to minimize the double counting of internal activities. However,
charges for interfund services provided and used are not eliminated if the prices
approximate their external exchange values.
Fund financial statements-provide information about the County’s funds, including
fiduciary funds and blended component units. Separate statements are presented for the
governmental, proprietary, and fiduciary fund categories. The emphasis of fund financial
statements is on major governmental and enterprise funds, each displayed in a separate
column. All remaining governmental and enterprise funds are aggregated and reported
as nonmajor funds. Fiduciary funds are aggregated and reported by fund type.
Proprietary fund revenues are classified as either operating or nonoperating. Operating
revenues and expenses generally result from transactions associated with the fund’s
principal activity. Accordingly, revenues, such as user charges and net patient charges,
in which each party receives and gives up essentially equal values, are operating
revenues. Other revenues such as subsidies and investment income, result from
transactions in which the parties do not exchange equal values. Revenues generated by
ancillary activities are also reported as nonoperating revenues. Operating expenses
include the cost of services, administrative expenses, and depreciation on capital assets.
The County reports the following major governmental funds:
The General Fund is the County’s primary operating fund. It accounts for all financial
resources of the general government, except those required to be accounted for in
another fund.
The Jail District Fund is used to account for County jail operations.
The Jail Construction Fund is used to account for the construction of the new County jail
and the remodel of the existing facility. Although the criteria for classification as a major
fund was not met, the County has elected to disclose this fund as a major fund due to its
importance to financial statement users.
The Jail District Debt Service Fund is used to account for the resources accumulated and
payments made for principal and interest on the revenue bonds issued for the
construction and remodel of the County jail.
The Regional Road Fund is used to account for road construction and maintenance of
major regional roads, and is funded by a ½ cent County sales tax and impact fees.
The HURF Road Fund is used to account for road maintenance and construction of
nonmajor roads, and is funded primarily by highway users revenue.
Yavapai County
Notes to Financial Statements
June 30, 2004
39
The Capital Projects Fund is used to account for major capital projects and is funded by
transfers from the general fund.
The County reports the following major proprietary fund:
The Long-term Care Fund is used to account for the activities of the Yavapai County
Department of Medical Assistance Long-term Care Division. The Long-Term Care
Division operates a prepaid health program for qualified persons of the County.
The County reports the following fund types:
The investment trust fund accounts for pooled assets held and invested by the County
Treasurer on behalf of County departments and other governmental entities.
The agency fund accounts for assets held by the County in a fiduciary capacity for others.
C. Basis of Accounting
The government-wide, proprietary fund and fiduciary fund financial statements are
presented using the economic resources measurement focus and the accrual basis of
accounting. Revenues are recorded when earned and expenses are recorded at the time
liabilities are incurred, regardless of when the related cash flows take place. Property
taxes are recognized as revenue in the year for which they are levied. Grants and
donations are recognized as revenue as soon as all eligibility requirements the provider
imposed have been met.
Governmental funds in the fund-based financial statements are reported using the current
financial resources measurement focus and the modified accrual basis of accounting.
Under this method, revenues are recognized when measurable and available. The
County considers all revenues reported in the governmental funds to be available if the
revenues are collected within 60 days after year-end. Expenditures are recorded when
the related fund liability is incurred, except for principal and interest on general long-term
debt, claims and judgments, compensated absences, and landfill closure and postclosure
care costs, which are recognized as expenditures to the extent they are due and payable.
General capital asset acquisitions are reported as expenditures in governmental funds.
Proceeds of long-term debt and acquisitions under capital lease agreements are reported
as other financing sources.
Under the terms of grant agreements, the County funds certain programs by a
combination of grants and general revenues. Therefore, when program expense is
incurred, there are both restricted and unrestricted net assets available to finance the
program. The County applies grant resources to such programs before using general
revenues.
Yavapai County
Notes to Financial Statements
June 30, 2004
40
The County’s business-type activities and enterprise funds follow FASB Statements and
Interpretations issued on or before November 30, 1989; Accounting Principles Board
Opinions; and Accounting Research Bulletins, unless those pronouncements conflict with
GASB pronouncements. The County has applied the option not to follow those FASB
pronouncements issued after November 30, 1989.
D. Cash and Investments
For purposes of the statement of cash flows, the County considers cash on hand,
demand deposits, cash on deposit with the County Treasurer, and only those highly liquid
investments with a maturity of three months or less when purchased to be cash and cash
equivalents. Money market investments with a remaining maturity of one year or less at
time of purchase are stated at amortized cost. All other investments are stated at fair
value.
E. Inventories and Prepaid Items
Inventories of the governmental funds consist of expendable supplies held for
consumption and are recorded as expenditures at the time of purchase. Amounts on
hand at year-end are shown on the balance sheet as an asset for informational purposes
only and are offset by a fund balance reserve to indicate that they do not constitute
“available spendable resources.” These inventories are stated at cost using the first-in,
first-out method.
Certain payments to vendors reflect costs applicable to future accounting periods and are
recorded as prepaid items.
F. Property Tax Calendar
The County levies real and personal property taxes on or before the third Monday in
August that become due and payable in two equal installments. The first installment is
due on the first day of October and becomes delinquent after the first business day of
November. The second installment is due on the first day of March of the next year and
becomes delinquent after the first business day of May.
A lien assessed against real and personal property attaches on the first day of January
preceding assessment and levy.
G. Restricted Assets
Certain resources set aside for repayment of the jail construction revenue bonds are
classified as restricted assets on the balance sheet because they are maintained in
separate accounts and their use is limited by applicable bond covenants. The “payment
fund” account is used to segregate resources accumulated for debt service payments
over the next twelve months. In addition, certain proceeds of a capital lease financing
are maintained in a separate account for the acquisition of capital assets, and are
classified as restricted.
Yavapai County
Notes to Financial Statements
June 30, 2004
41
H. Capital Assets
Capital assets are reported at actual cost. Donated assets are reported at estimated fair
value at the time received.
Capitalization thresholds (the dollar values above which asset acquisitions are added to
the capital asset accounts), depreciation methods, and estimated useful lives of capital
assets reported in the government-wide statements and proprietary funds are as follows:
Capitalization
Threshold
Land $10,000
Depreciation
Method
Estimated
Useful Life
Buildings $10,000 Straight-line 20-40 years
Machinery and Equipment $5,000 Straight-line 5 -10 years
Infrastructure $10,000 Straight-line 12-40 years
I. Investment Income
Investment income is composed of interest, dividends, and net changes in the fair value
of applicable investments.
J. Compensated Absences
Compensated absences consist of paid time off (PTO) leave earned by employees based
on services already rendered.
Employees may accumulate up to 764 hours of PTO, at various accrual rates, depending
on years of service. PTO hours in excess of the maximum amount are forfeited. Upon
termination of employment, all unused and unforfeited PTO benefits are paid to
employees. Accordingly, PTO benefits are accrued as a liability in the financial
statements.
Employees may also accumulate up to 520 hours of catastrophic time (CAT) leave. CAT
leave may be used in the case of illness or injury suffered by an employee or employee’s
immediate family, but only after using at least forty hours of consecutive PTO leave. CAT
leave benefits are cumulative but are forfeited upon termination of employment, and
therefore are not accrued.
Yavapai County
Notes to Financial Statements
June 30, 2004
42
Note 2 - Deposits and Investments
Arizona Revised Statutes authorize the County to invest public monies in the State
Treasurer’s investment pool; U.S. Treasury obligations; specified state and local
government bonds; and interest-earning investments such as savings accounts,
certificates of deposit, and repurchase agreements in eligible depositories. The statutes
require collateral for demand deposits, certificates of deposit, and repurchase
agreements at 101 percent of all deposits not covered by federal depository insurance.
County Treasurer’s Investment Pool - Arizona Revised Statutes require community
colleges, school districts, and other local governments to deposit certain public monies
with the County Treasurer (see Note 17). Those monies are pooled with County monies
for investment purposes.
Deposits - The investment pool’s deposits at June 30, 2004, were entirely covered by
federal depository insurance or by collateral held by the County’s custodial bank in the
County’s name.
Investments - At June 30, 2004, the investments in the County Treasurer’s investment
pool consisted of the following.
Fair
Value
Investment in State Treasurer’s investment pool $ 41,342,972
U.S. government securities 35,161,163
Total $ 76,504,135
The State Board of Investment provides oversight for the State Treasurer’s pools, and the
Local Government Investment Pool Advisory Committee provides consultation and
advice to the Treasurer. The fair value of a participant’s position in the pool approximates
the value of that participant’s pool shares.
The investment pool’s investments at June 30, 2004, are categorized below to give an
indication of the level of risk assumed by the County at year-end.
Category 1 - insured or registered in the County’s name, or securities held by the County
or its agent in the County’s name.
Category 2 - uninsured and unregistered with securities held by the counterparty’s trust
department or agent in the County’s name.
Category 3 - uninsured and unregistered with securities held by the counterparty, or by its
trust department or agent but not in the County’s name.
Category Fair
1 2 3 Value
U.S. government securities - $ 35,161,163 - $ 35,161,163
- $ 35,161,163 - 35,161,163
Investments not subject to categorization:
Investment in State Treasurer’s investment pool 41,342,972
Total $ 76,504,135
Yavapai County
Notes to Financial Statements
June 30, 2004
43
Other Deposits – The County’s nonpooled deposits at June 30, 2004, were entirely
covered by federal depository insurance or by collateral held by the County’s custodial
banks in the County’s name.
Other Investments – At June 30, 2004, the County’s nonpooled investments consisted
of the following:
Fair Value
Money market funds-U.S. government securities $ 1,916,488
Total cash and cash equivalents $ 1,916,488
The fair value of the investments approximates the reported value. These investments
are categorized as Category 3.
A reconciliation of cash and investments to amounts shown on the Statement of Net
Assets as follows.
Cash and investments:
County Treasurer’s
Investment Pool Other Total
Cash on hand $ 903,539 $ 6,780 $ 910,319
Carrying amount of deposits 965,113 2,596,043 3,561,156
Oustanding warrants (2,062,895) - (2,062,895)
Reported amount of investments 76,504,135 1,916,488 78,420,623
Total cash and cash equivalents $ 76,309,892 $ 4,519,311 $ 80,829,203
Statement of Net Assets: Total Total
Primary Fiduciary
Government Funds Total
Cash and cash equivalents $ 35,262,302 $ 43,650,413 $ 78,912,715
Cash and equivalents - restricted 1,916,488 - 1,916,488
Total cash and cash equivalents $ 37,178,790 $ 43,650,413 $ 80,829,203
Note 3 - Due From Other Governments
Amounts due from other governments at June 30, 2004, include $1,569,903 in state-shared
revenue from sales tax, $254,133 in county excise tax distributions due from the
State Treasurer, $529,392 in state motor vehicle license taxes from the Arizona
Department of Transportation, $248,148 in excess contributions due from the Arizona
Health Care Cost Containment System and $173,219 in other fees from federal, state,
and local governments recorded in the General Fund; $894,261 in state-shared revenue
from highway user taxes, and $333,381 in state motor vehicle license tax and $9,387 in
other fees from federal, state, and local governments recorded in the HURF Road Fund;
$876,978 in grants and other fees from federal, state grants and local governments
recorded in the Other Governmental Funds; $762,399 in county excise tax distributions
due from the State Treasurer and $62,200 in other fees from local governments recorded
in the Regional Road Fund; $544,906 in sales tax collections and $156,880 in other fees
from the federal, state and local governments recorded in the Jail District Fund.
Yavapai County
Notes to Financial Statements
June 30, 2004
44
Note 4 - Capital Assets
Capital assets activity for the year ended June 30, 2004, was as follows:
Balance
July 1 ,2003, Balance
as restated Increases Decreases June 30, 2004
Governmental activities:
Capital assets not being depreciated:
Land $ 11,816,159 $ 7,398 (118,501) $ 11,705,056
Construction in progress (estimated
cost to complete $3,555,801) 34,262,961 14,271,577 (36,422,929) 12,111,609
Total capital assets not being
Depreciated 46,079,120 14,278,975 (36,541,430) 23,816,665
Capital assets being depreciated:
Buildings 35,827,129 22,026,683 (136,082) 57,717,730
Machinery and equipment 25,712,759 2,839,281 (2,393,518) 26,158,522
Infrastructure 14,448,443 17,068,574 - 31,517,017
Total 75,988,331 41,934,538 (2,529,600) 115,393,269
Less accumulated depreciation for:
Buildings (9,351,619) (1,255,132) 76,546 (10,530,205)
Machinery and equipment (15,640,915) (2,639,687) 2,340,729 (15,939,873)
Infrastructure (1,445,463) (930,286) - (2,375,749)
Total (26,437,997) (4,825,105) 2,417,275 (28,845,827)
Total capital assets, being
depreciated, net 49,550,334 37,109,433 (112,325) 86,547,442
Governmental activities capital
assets, net $95,629,454 $ 51,388,408 $(36,653,755) $110,364,107
Business-type activities:
Capital assets being depreciated:
Machinery and equipment $ 443,518 $ 123,993 $ - $ 567,511
Total capital assets being
depreciated 443,518 123,993 - 567,511
Less accumulated depreciation for:
Machinery and equipment (330,002) (63,381) - (393,383)
Total (330,002) (63,381) - (393,383)
Business-type activities capital
Assets, net $ 113,516 $ 60,612 $ - $ 174,128
Yavapai County
Notes to Financial Statements
June 30, 2004
45
Depreciation expense was charged to functions as follows:
Governmental Activities:
General government $ 1,667,123
Public safety 966,217
Highway and streets 1,866,848
Sanitation 86,131
Health 106,126
Welfare 1,482
Education 19,323
Culture and Recreation 111,855
Total governmental activities depreciation expense $ 4,825,105
Business-type activities:
Long-term care $ 63,381
Total business-type activities depreciation expense $ 63,381
Construction Commitments
The County has active construction projects as of June 30, 2004. At June 30, 2004 the
County’s commitments with contractors are as follows:
Project Spent-to-date
Remaining
Commitment
Mingus Avenue $ 8,879,307 $ 1,421,610
Old Black Canyon Highway 304,035 200,942
Dry Creek Crossing 141,205 281,363
Total $ 9,324,547 $ 1,903,915
The road improvement projects are being funded by sales taxes out of the regional road
fund.
Restatement of Beginning Capital Assets
Governmental activities net capital assets of $89,446,116 at June 30, 2003 have been
restated for the recording of certain capital assets on hand as of that date. This
adjustment results in an increase of $6,183,338 in beginning net assets at July 1, 2003.
Yavapai County
Notes to Financial Statements
June 30, 2004
46
Note 5 - Long-term Liabilities
The following schedule details the County’s long-term liability and obligation activity for
the year ended June 30, 2004.
Balance
July 1, 2003 Additions Reductions
Balance
June 30, 2004
Due
within
1 year
Governmental Activities:
Special assessment debt payable $ 1,838,094 $ - $ (122,940) $ 1,715,154 $ 127,287
Revenue bonds 13,945,000 - (1,350,000) 12,595,000 1,395,000
Total special assessment debt payable
and revenue bonds payable 15,783,094 - (1,472,940) 14,310,154 1,522,287
Notes payable 8,812,500 - (2,437,500) 6,375,000 4,312,500
Compensated absences payable 5,782,861 4,477,920 (4,285,099) 5,975,682 4,427,979
Obligations under capital leases 1,497,290 1,300,000 (1,043,501) 1,753,789 723,057
Landfill closure and postclosure care costs payable 1,339,575 43,483 (22,981) 1,360,077 -
Claims and judgments payable 369,594 69,832 (143,729) 295,697 73,924
Governmental activities long-term liabilities $ 33,584,914 $ 5,891,235 $ (9,405,750) $ 30,070,399 $11,059,747
Note 6 - Special Assessment Debt Payable
As described in the “Blended Component Units” section of Note 1, the Yavapai County
Board of Supervisors acts as the Board of Directors of various special districts, therefore
the bonded debt of these districts is included as part of the Yavapai County reporting
entity.
Special assessment bonds are secured by pledges of revenues from special
assessments levied against the benefiting property owners. The proceeds of the bond
issues were used to finance construction in these districts. These bonds are generally
callable with interest payable semiannually. However, in accordance with the bond
indenture for each special assessment bond issue, and in the opinion of the County
Attorney, the County is not legally obligated in any way for the special assessment
bonded indebtedness.
The following special assessment districts had debt outstanding at June 30, 2004.
District
Interest
Rates
Maturity
Ranges
Outstanding
Principal
July 1, 2003 Retirements
Outstanding
Principal
June 30, 2004
Bonds
Granite Gardens 1989 6.13 % 7/1/90-7/1/2007 $ 53,000 $ (10,000) 43,000
Pine Valley Street Imp. 6.45 % 7/1/97-7/1/2007 40,000 (10,000) 30,000
Coyote Springs Road Imp. 6.40 % 1/1/03-1/1/2022 1,480,000 (75,000) 1,405,000
Note Payable
Prescott East Sanitary Dist. 4.82 % 7/1/02-7/1/2010 265,094 (27,940) 237,154
Total $ 1,838,094 $ (122,940) 1,715,154
Yavapai County
Notes to Financial Statements
June 30, 2004
47
Special assessment debt service requirements to maturity are as follows:
Principal Interest
Year ending June 30, 2005 127,287 103,199
2006 130,699 95,546
2007 132,178 87,702
2008 108,730 80,109
2009 110,355 73,683
2010-2014 465,905 273,691
2015-2019 400,000 140,800
2020-2022 240,000 23,040
Total $ 1,715,154 $ 877,770
Note 7 - Bonds
The County’s bonded debt consists of $15,260,000 revenue bonds issued by the Yavapai
County Jail District on February 13, 2002. As described in the “Blended Component
Units” section of Note 1, the Yavapai County Board of Supervisors acts as the Board of
Directors of various special districts, therefore the bonded debt of these districts is
included as part of the Yavapai County reporting entity.
The bond proceeds are being used to construct a new jail and to remodel an existing jail.
The bonds will be repaid from maintenance of effort payments from the County’s general
fund to the District and a voter approved excise tax. The total budgeted and actual
maintenance of effort payments transferred to the District in the fiscal year ended June
30, 2004 was $7,407,000. Excise taxes received for the same period were $6,201,641,
which was 7.3% greater than the budgeted amount of $5,776,000.
Bonds outstanding at June 30, 2004, were as follows:
Jail District
Interest
Rates
Maturity
Ranges
Outstanding
Principal
July 1, 2003 Retirements
Outstanding
Principal
June 30, 2004
Revenue bonds 3-4.3 % 7/1/2004-
7/1/2012 $ 13,945,000 $ (1,350,000) $12,595,000
Total $ 13,945,000 $ (1,350,000) $12,595,000
The following schedule details debt service requirements to maturity for the County’s
revenue bonds payable at June 30, 2004.
Governmental
Activities
Principal Interest
Year ending June 30, 2005 $ 1,395,000 $475,190
2006 1,435,000 433,340
2007 1,480,000 387,420
2008 1,530,000 335,620
2009 1,590,000 279,010
2010-2012 5,165,000 441,590
Total $ 12,595,000 $ 2,352,170
Yavapai County
Notes to Financial Statements
June 30, 2004
48
Note 8 - Notes Payable
Yavapai County entered into two loan agreements with the Arizona State Department of
Transportation, through its Highway Expansion and Extension Loan Program (HELP) for
funds needed to complete the construction of a major road project. The County’s notes
payable at June 30, 2004 are as follows:
The following schedule details debt service requirements to maturity for the County’s
notes payable at June 30, 2004.
Note 9 - Compensated Absences and Claims and Judgments
Compensated absences are paid from various funds in the same proportion that those
funds pay payroll costs. Claims and judgments are generally paid from the fund that
accounts for the activity that gave rise to the claim. During fiscal year 2004, the County
paid for compensated absences as follows: 54 percent from the General Fund, 24
percent from other major funds, and 22 percent from other funds. The County paid for
claims and judgments from the General Fund.
Note 10 - Capital Leases
The County has acquired equipment items under the provisions of various long-term
lease agreements classified as capital leases for accounting purposes because they
provide for a transfer of ownership by the end of the lease term.
HELP loan dated July 1, 2002, principal amount of
$4,500,000, payable monthly over 24 months beginning
July 15, 2003, interest rate of 1.83%, secured by the
County’s highway user revenues. $2,062,500
HELP loan dated July 15, 2002, principal amount of
$4,500,000, payable monthly over 24 months beginning
July 15, 2004, interest rate of 2.25.%, secured by the
County’s highway user revenues. 4,312,500
Total Notes Payable 6,375,000
Less Current Maturities (4,312,500)
Long-term portion of Notes Payable $2,062,500
Governmental
Activities
Principal Interest
Year ending June 30, 2005 $4,312,500 $ 92,700
2006 2,062,500 23,203
Total $6,375,000 $115,903
Yavapai County
Notes to Financial Statements
June 30, 2004
49
The assets acquired through capital leases are as follows:
Governmental
Activities
Machinery and equipment $ 3,224,462
Less: accumulated depreciation (774,061)
Carrying value $ 2,450,401
The following schedule details debt service requirements to maturity for the County’s
capital leases payable at June 30, 2004.
Governmental
Activities
Year ending June 30, 2005 $ 993,207
2006 726,630
2007 74,842
Total minimum lease payments 1,794,679
Less amount representing interest 40,890
Present value of net minimum
capital lease payments $ 1,753,789
Note 11 - Landfill Closure and Postclosure Care Costs
State and federal laws and regulations require the County to place final covers on its 7
landfill sites when they stop accepting waste and to perform certain maintenance and
monitoring functions at the sites for 30 years after closure. Although closure and
postclosure care costs will not be paid until near or after the dates that the landfills stop
accepting waste, the County reports a portion of these closure and postclosure care
costs in each operating period even though actual payouts will not occur until the landfills
are closed. These costs will be paid from the Landfill/Environment special revenue fund.
The amount recognized each year is based on landfill capacity used at the end of each
fiscal year. All 7 landfills stopped accepting waste and were closed prior to June 30,
2004. As of June 30, 2004, the landfill closure and postclosure care liability of
$1,360,377 represents the cumulative amount of cost remaining on these closed landfills,
which is net of expenditures incurred to date. These cumulative amounts are based on
what it would cost to perform all closure and postclosure care in fiscal year 2004 and
have been adjusted for changes in estimates during the fiscal year. The actual cost may
be higher due to inflation, changes in technology, or changes in regulations.
According to state and federal laws and regulations, the County must comply with the
local government financial test requirements that assure the County can meet the costs
of landfill closure, postclosure, and corrective action when needed. The County is in
compliance with these requirements.
Yavapai County
Notes to Financial Statements
June 30, 2004
50
Note 12 - Insurance Claims
The County provides health benefits to its employees and their dependents through the
Yavapai Combined Trust, currently composed of three members. The Trust provides
benefits up to $100,000 per individual per calendar year through a self-funding
agreement with its participants and purchases commercial insurance to cover claims in
excess of this limit. An independent administrator provides the trust with claim and
recordkeeping services. The County is responsible for paying the premiums and requires
its employees to contribute for dependent coverage. The County is not liable for claims in
excess of coverage limits and cannot be assessed retroactive premium adjustments. If it
withdraws from the Trust, the County would be responsible for its proportional share of
any claims run-out costs, which exceed Trust Fund reserves established for the incurred
but not reported claims liability. If the Trust were to terminate, the County would be
responsible for its proportional share of any Trust deficit.
Note 13 - Risk Management
The County is exposed to various risks of loss related to torts; theft of, damage to, and
destruction of assets; errors and omissions; injuries to employees; and natural disasters;
but was unable to obtain insurance at a cost it considered to be economically justifiable.
Therefore, the County joined and is covered by three public entity risk pools: the Arizona
Counties Property and Casualty Pool, and the Arizona Counties Workers' Compensation
Pool which are described below, and the Yavapai Combined Trust, which is described
above.
The Arizona Counties Property and Casualty Pool is a public entity risk pool currently
composed of 11 member counties. The pool provides member counties catastrophic loss
coverage for risks of loss related to torts; theft of, damage to, and destruction of assets;
errors and omissions; and natural disasters; and provides risk management services.
Such coverage includes all defense costs as well as the amount of any judgment or
settlement. The County is responsible for paying a premium, based on its exposure in
relation to the exposure of the other participants, and deductibles of $25,000 per
occurrence for property claims and $50,000 per occurrence for liability claims. The
County is also responsible for any payments in excess of the maximum coverage of $100
million per occurrence for property claims and $10 million per occurrence for liability
claims. A County must participate in the pool at least three years after becoming a
member; however, it may withdraw after the initial three-year period. If the pool were to
become insolvent, the County would be assessed an additional contribution.
The Arizona Counties Workers' Compensation Pool is a public entity risk pool currently
composed of 11 member counties. The pool provides member counties with workers'
compensation coverage, as required by law, and risk management services. The County
is responsible for paying a premium, based on an experience rating formula, that
allocates pool expenditures and liabilities among the members.
Yavapai County
Notes to Financial Statements
June 30, 2004
51
The Arizona Counties Property and Casualty Pool and the Arizona Counties Workers’
Compensation Pool receive independent audits annually and an audit by the Arizona
Department of Insurance triennially. Both pools accrue liabilities for losses that have been
incurred but not reported. These liabilities are determined annually based on an
independent actuarial valuation.
Note 14 - Line of Credit Arrangement
The County has a $6,500,000 line of credit arrangement with a bank. The line of credit
matures on June 30, 2005, and is collateralized by U.S. Government-backed securities.
At June 30, 2004, no portion of this amount was utilized.
Note 15 - Retirement Plans
Plan Descriptions - The County contributes to four plans, three of which are described
below. The Elected Officials Retirement Plan is not described due to its relative
insignificance to the County's financial statements. Benefits are established by state
statute and generally provide retirement, death, long-term disability, survivor, and health
insurance premium benefits.
The Arizona State Retirement System (ASRS) administers a cost-sharing multiple-employer
defined benefit pension plan that covers general employees of the County. The
ASRS is governed by the Arizona State Retirement System Board according to the
provisions of A.R.S. Title 38, Chapter 5, Article 2.
The Public Safety Personnel Retirement System (PSPRS) is an agent multiple-employer
defined benefit pension plan that covers public safety personnel who are regularly
assigned hazardous duty as employees of the State of Arizona or one of its political
subdivisions. The PSPRS, acting as a common investment and administrative agent, is
governed by a five-member board, known as The Fund Manager, and the participating
local boards according to the provisions of A.R.S. Title 38, Chapter 5, Article 4.
The Corrections Officer Retirement Plan (CORP) is an agent multiple-employer defined
benefit pension plan that covers certain employees of the State of Arizona, Departments
of Corrections and Juvenile Corrections, and County employees whose primary duties
require direct inmate contact. The CORP is governed by The Fund Manager of PSPRS
and the participating local boards according to the provisions of A.R.S. Title 38, Chapter
5, Article 6.
Each plan issues a publicly available annual financial report that includes its financial
statements and required supplementary information. A report may be obtained by writing
or calling the applicable plan.
ASRS PSPRS and CORP
3300 N. Central Ave.
P.O. Box 33910
Phoenix, AZ 85067-3910
(602) 240-2000 or (800) 621-3778
1020 E. Missouri Ave.
Phoenix, AZ 85014
(602) 255-5575
Yavapai County
Notes to Financial Statements
June 30, 2004
52
Funding Policy - The Arizona State Legislature establishes and may amend active plan
members' and the County's contribution rates.
Cost-sharing plan - For the year ended June 30, 2004, active ASRS members and the
County were each required by statute to contribute at the actuarially determined rate of
5.70 percent (5.20 percent retirement and 0.50 percent long-term disability) of the
members' annual covered payroll. The County's contributions to ASRS for the years
ended June 30, 2004, 2003, and 2002 were $2,266,529, $960,807 and $857,912
respectively, which were equal to the required contributions for the year.
Agent plans - For the year ended June 30, 2004, active PSPRS members were required
by statute to contribute 7.65 percent of the members' annual covered payroll, and the
County was required to contribute at the actuarially determined rate of 13.04 percent.
Active CORP members were required by statute to contribute 8.5 percent of the
members’ annual covered payroll, and the County was required to contribute at the
actuarially determined rate of 5.38 percent.
Annual Pension Cost - The County's pension cost for the two agent plans for the year
ended June 30, 2004, and related information follow.
PSPRS CORP
Contribution rates:
County 13.04% 5.38%
Plan members 7.65% 8.50%
Annual pension cost $648,780 $288,947
Contributions made $648,780 $288,947
The current-year annual required contributions for both the PSPRS and the CORP were
determined as part of their June 30, 2002, actuarial valuations using the individual entry-age
actuarial cost method. The actuarial assumptions included (a) 9 percent investment
rate of return and (b) projected salary increases ranging from 6.5 percent to 9.5 percent
per year. Both (a) and (b) included an inflation component of 5.5 percent. The
assumptions did not include cost-of-living adjustments. The actuarial value of assets was
determined using techniques that smooth the effects of short-term volatility in the market
value of investments over time. The unfunded actuarial accrued liability is being amortized
as a level percentage of projected payroll on an open basis. The remaining amortization
period at June 30, 2002, was 20 years.
Yavapai County
Notes to Financial Statements
June 30, 2004
53
Trend Information - Annual pension cost information for the current and two preceding
years follows for each of the agent plans.
Contributions Required and Contributions Made
Plan
Year Ended
June 30
Annual Pension
Cost (APC)_
Percentage of
APC
Contributed
Net Pension
Obligation
PSPRS 2004 $648,780 100% $ -0-
2003 465,783 100% -0-
2002 547,661 100% -0-
CORP 2004 288,947 100% -0-
2003 126,031 100% -0-
2002 87,233 100% -0-
Note 16 - Interfund Balances and Activity
Interfund receivables and payables-interfund balances at June 30, 2004, were as follows:
Payable To
General
Fund
Jail
District
Jail
Construction
Regional
Road
Payable from
General Fund $ - $ - $ 15 $ -
Jail District - - 438 -
Jail District Debt Service - 257,845 - -
HURF Road 36,518 - - -
Capital Projects - - 272 -
Nonmajor Governmental Funds 337,457 1,994 - 1,116
Long-term Care - - - -
Total $ 373,975 $ 259,839 $ 725 $ 1,116
Payable To
HURF
Road
Nonmajor
Governmental
Funds Long-term care Total
Payable from
General Fund $ 9,488 $ 41,854 $ - $ 51,357
Jail District - - - 438
Jail District Debt Service - - - 257,845
HURF Road - 36 - 36,554
Capital Projects 2,849 - 36,730 39,851
Nonmajor Governmental Funds 19,034 150,852 15,800 526,253
Long-term Care - 177,710 - 177,710
Total $ 31,371 $ 370,452 $ 52,530 $ 1,090,008
Yavapai County
Notes to Financial Statements
June 30, 2004
54
The interfund balances resulted from time lags between the dates that (1) interfund
goods and services are provided or reimbursable expenditures occur, (2) transactions are
recorded in the accounting system, and (3) payments between funds are made.
Interfund transfers-interfund transfers for the year ended June 30, 2004, were as follows:
Transfer To
General
Fund
Jail
District
Jail
Construction
Jail
Debt Service
Transfer from
General Fund $ - $ 7,407,000 $ - $ -
Jail District - - 2,709,737 1,811,465
HURF Road 600,000 - - -
Regional Road - - - -
Nonmajor Governmental Funds 799,846 - - -
Long-term Care 1,000,000 - - -
Total $ 2,399,846 $ 7,407,000 $ 2,709,737 $ 1,811,465
Transfer To
Capital
Projects
Nonmajor
Governmental
Funds Total
Transfer from
General Fund $ 274,750 $ 1,848,767 $ 9,530,517
Jail District - - 4,521,202
HURF Road - - 600,000
Regional Road - 2,701,735 2,701,735
Nonmajor Governmental Funds - 513,160 1,313,006
Long-term Care - - 1,000,000
Total $ 274,750 $ 5,063,662 $ 19,666,460
Transfers are used to (1) move revenues from the fund that statute or budget requires to
collect them to the fund that statute or budget requires to expend them (2) move receipts
restricted to debt service from the funds collecting the receipts to the debt service fund as
debt service payments become due, (3) use unrestricted revenues collected in the
general fund to finance various programs accounted for in other funds in accordance with
budgetary authorizations, and (4) move amounts in excess of required minimum
balances, as approved by AHCCCS.
Note 17 - Condensed Financial Statements of the County Treasurer’s Investment Pool
Arizona Revised Statutes require community colleges, school districts, and other local
governments to deposit certain public monies with the County Treasurer. The Treasurer
has a fiduciary responsibility to administer those and the County monies under his
stewardship. The Treasurer invests, on a pool basis, all idle monies not specifically
invested for a fund or program. In addition, the Treasurer determines the fair value of
those pooled investments annually at June 30.
Yavapai County
Notes to Financial Statements
June 30, 2004
55
The County Treasurer's investment pool is not registered with the Securities and
Exchange Commission as an investment company and there is no regulatory oversight of
its operations. The pool’s structure does not provide for shares and the County has not
provided or obtained any legally binding guarantees to support the values of the
participants' investments.
Details of each major investment classification follow.
Investment Type Principal
Interest
Rates Maturities
Fair
Value
U.S. government securities $35,000,000 2.0-5.0% 8/13/04-10/29/07 $35,161,163
Investment in State Treasurer’s investment pool 41,342,972 1.0588% None stated 41,342,972
A condensed statement of the investment pool's net assets and changes in net assets
follows.
Statement of Net Assets
Assets $ 76,309,892
Liabilities -
Net assets $ 76,309,892
Net assets held in trust for:
Internal participants $ 34,846,176
External participants 41,463,716
Total net assets held in trust $ 76,309,892
Statement of Changes in Net Assets
Total additions $ 417,977,263
Total deductions (423,618,858)
Net decrease (5,641,595)
Net assets held in trust:
July 1, 2003 81,951,487
June 30, 2004 $ 76,309,892
56
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REQUIRED SUPPLEMENTARY INFORMATION
Yavapai County
Required Supplementary Information
Schedule of Agent Retirement Plans’ Funding Progress
June 30, 2004
57
Public Safety Personnel Retirement System
Unfunded
Liability as
Actuarial Actuarial Funding Annual Percentage
Actuarial Value of Accrued (Liability) Funded Covered Of Covered
Valuation Plan Assets Liability Excess Ratio Payroll Payroll
Date (a) (b) (a-b) (a/b) (c) ([a-b]/c)
6/30/04 $13,692,093 $18,169,579 $ (4,477,486) 75.4% $5,153,004 86.9%
6/30/03 13,059,119 15,833,057 (2,773,938) 82.5% 4,419,330 62.8%
6/30/02 12,560,975 14,232,671 (1,671,696) 88.3% 4,318,078 38.7%
Corrections Officer Retirement Plan
Unfunded
Liability as
Actuarial Actuarial Funding Annual Percentage
Actuarial Value of Accrued (Liability) Funded Covered Of Covered
Valuation Plan Assets Liability Excess Ratio Payroll Payroll
Date (a) (b) (a-b) (a/b) (c) ([a-b]/c)
6/30/04 $6,696,956 $6,813,658 $(116,702) 98.3% $6,030,637 1.9%
6/30/03 6,286,600 5,835,586 451,014 107.7% 4,073,025 -
6/30/02 6,022,539 5,274,883 747,656 114.2% 3,954,989 -
See accompanying notes to budgetary comparison schedules.
58
Yavapai County
Required Supplementary Information
Budgetary Comparison Schedule
General Fund
Year End June 30, 2004
Budgeted Amounts Actual Variance with
Original Final Amounts Final Budget
Revenues:
Taxes $ 29,582,903 $ 29,582,903 $ 29,895,412 $ 312,509
Licenses and Permits 2,440,000 2,440,000 2,730,437 290,437
Intergovernmental 25,414,124 25,414,124 25,260,228 (153,896)
Charges For Services 1,460,000 1,460,000 1,570,577 110,577
Fines and Forfeits 1,775,000 1,775,000 1,978,124 203,124
Investment Income 200,000 200,000 31,743 (168,257)
Miscellaneous 857,675 857,675 1,428,749 571,074
Total Revenues 61,729,702 61,729,702 62,895,270 1,165,568
Expenditures:
Board of Supervisors 618,029 619,051 583,509 35,542
Human Resources 594,969 594,969 554,740 40,229
General Services 5,236,807 4,382,597 4,031,450 351,147
Emergency Management 100,080 100,080 99,986 94
Elections 410,047 410,047 230,751 179,296
Facilities 3,460,413 3,460,413 3,427,778 32,635
Development Services 3,145,045 3,182,585 3,052,021 130,564
Fleet 1,714,883 1,714,883 1,632,776 82,107
Finance 537,775 537,775 534,127 3,648
Assessor 2,916,642 2,916,642 2,831,985 84,657
Attorney 3,217,547 3,332,469 3,332,469 -
Voter Registration 291,356 303,791 303,790 1
Recorder 668,082 668,082 637,495 30,587
Management Information System 4,273,711 4,273,711 3,981,354 292,357
Clerk of the Court 1,678,687 1,680,807 1,680,806 1
Treasurer 629,886 629,886 626,802 3,084
Records Management 267,260 329,980 329,979 1
Superior Courts 2,772,058 2,851,268 2,851,267 1
Public Defender 2,449,452 2,812,370 2,812,367 3
Prescott Justice of the Peace 480,697 480,697 438,805 41,892
Prescott Constable 61,377 61,377 60,678 699
Bagdad/Yarnell Justice of the Peace 250,432 250,432 249,871 561
Verde Valley justice of the Peace 395,093 395,093 390,758 4,335
Mayer Justice of the Peace 321,145 321,145 319,928 1,217
Verde Constable 60,717 60,717 56,240 4,477
Seligman Justice of the Peace 241,824 241,824 238,492 3,332
Total General Government 36,794,014 36,612,691 35,290,224 1,322,467
(Continued)
See accompanying notes to budgetary comparison schedules.
59
Yavapai County
Required Supplementary Information
Budgetary Comparison Schedule
General Fund
Year End June 30, 2004
Budgeted Amounts Actual Variance with
Original Final Amounts Final Budget
Public Safety:
Sheriff 8,936,560 8,936,560 8,936,560 -
Adult Probation 1,286,807 1,286,807 1,249,245 37,562
Juvenile Probation 1,720,306 1,735,767 1,735,766 1
Total Public Safety 11,943,673 11,959,134 11,921,571 37,563
Welfare:
Medical Assistance 7,613,404 7,613,404 7,623,810 (10,406)
Public Fiduciary 349,432 349,432 326,600 22,832
Total Welfare 7,962,836 7,962,836 7,950,410 12,426
Education:
School Superintendent 523,994 523,994 523,982 12
Total Education 523,994 523,994 523,982 12
Total Expenditures 57,224,517 57,058,655 55,686,187 1,372,468
Excess of Revenues Over
(Under) Expenditures 4,505,185 4,671,047 7,209,083 2,538,036
Other Financing Sources (Uses):
Transfer In 3,290,000 3,290,000 2,399,846 (890,154)
Transfer Out (9,367,528) (9,367,528) (9,530,517) (162,989)
Loan Proceeds - - - -
Sale of General Fixed Assets - - - -
Total Other Financing Source (Use) (6,077,528) (6,077,528) (7,130,671) (1,053,143)
Net change in fund balances (1,572,343) (1,406,481) 78,412 1,484,893
Fund Balance, July 1, 2003 1,572,343 1,406,481 1,784,993 378,512
Increase in reserve for inventories - - 91,724 91,724
Fund Balance, June 30, 2004 $ - $ - $ 1,955,129 $ 1,955,129
See accompanying notes to budgetary comparison schedules.
60
Yavapai County
Required Supplementary Information
Budgetary Comparison Schedule
Jail District Fund
Year Ended June 30, 2004
Budgeted Amounts Actual Variance with
Original Final Amounts Final Budget
Revenues:
Taxes $ 5,776,000 $ 5,776,000 $ 6,201,641 $ 425,641
Charges for services - - 220,425 220,425
Investment income - - 55,536 55,536
Miscellaneous 252,000 252,000 300,014 48,014
Total revenues 6,028,000 6,028,000 6,777,616 749,616
Expenditures:
Public safety:
Sheriff 11,374,098 11,374,098 10,416,842 957,256
Total expenditures 11,374,098 11,374,098 10,416,842 957,256
Excess (deficiency) of revenues
over (under) expenditures (5,346,098) (5,346,098) (3,639,226) 1,706,872
Other financing sources (uses):
Transfer in 7,407,000 7,407,000 7,407,000 -
Transfer out (6,865,690) (6,865,690) (4,521,203) 2,344,487
Total other financing sources (uses) 541,310 541,310 2,885,797 2,344,487
Net changes in fund balances (4,804,788) (4,804,788) (753,429) 4,051,359
Fund balances, July 1, 2003 4,804,788 4,804,788 5,160,418 355,630
Fund balances, June 30, 2004 $ - $ - $ 4,406,989 $ 4,406,989
See accompanying notes to budgetary comparison schedules.
61
Yavapai County
Required Supplementary Information
Budgetary Comparison Schedule
Regional Road Fund
Year Ended June 30, 2004
Budgeted Amounts Actual Variance with
Original Final Amounts Final Budget
Revenues:
Taxes $ 9,000,000 $ 9,000,000 $ 9,447,139 $ 447,139
Licenses and permits 1,400,000 1,400,000 1,500,511 100,511
Investment income 120,000 120,000 43,602 (76,398)
Miscellaneous - - 7,906 7,906
Total revenues 10,520,000 10,520,000 10,999,158 479,158
Expenditures:
Highways and streets:
Public works 15,751,909 15,751,909 9,029,219 6,722,690
Total expenditures 15,751,909 15,751,909 9,029,219 6,722,690
Excess (deficiency) of revenues
over (under) expenditures (5,231,909) (5,231,909) 1,969,939 7,201,848
Other financing sources (uses):
Transfer out (2,764,983) (2,764,983) (2,701,735) 63,248
Total other financing sources (uses) (2,764,983) (2,764,983) (2,701,735) 63,248
Net changes in fund balances (7,996,892) (7,996,892) (731,796) 7,265,096
Fund balances, July 1, 2003 7,996,892 7,996,892 8,193,436 196,544
Fund balances, June 30, 2004 $ - $ - $ 7,461,640 $ 7,461,640
See accompanying notes to budgetary comparison schedules.
62
Yavapai County
Required Supplementary Information
Budgetary Comparison Schedule
HURF Road Fund
Year Ended June 30, 2004
Budgeted Amounts Actual Variance with
Original Final Amounts Final Budget
Revenues:
Intergovernmental $ 13,815,358 $ 13,815,358 $ 13,816,633 $ 1,275
Investment income - - 4,215 4,215
Miscellaneous 500,000 500,000 433,860 (66,140)
Total revenues 14,315,358 14,315,358 14,254,708 (60,650)
Expenditues
Highways and streets:
Public works 13,711,823 13,714,685 12,994,195 720,490
Fleet 1,503,534 1,503,534 1,559,335 (55,801)
Total expenditures 15,215,357 15,218,219 14,553,530 664,689
Excess (deficiency) of revenues
over (under) expenditures (899,999) (902,861) (298,822) 604,039
Other financing sources (uses):
Transfer out (600,000) (600,000) (600,000) -
Total other financing sources (uses) (600,000) (600,000) (600,000) -
Net changes in fund balances (1,499,999) (1,502,861) (898,822) 604,039
Fund balances, July 1, 2003 1,499,999 1,502,861 1,397,942 (104,919)
Increase in reserve for inventories - - 70,793 70,793
Fund balances, June 30, 2004 $ -
$
- $ 569,913 $ 569,913
63
Yavapai County
Required Supplementary Information
Notes to Budgetary Comparison Schedules
Year Ended June 30, 2004
Note 1 - Budgetary Basis of Accounting
The County’s adopted budget is prepared on a basis consistent with generally accepted
accounting principles, except that the present value of net minimum capital lease
payments are not budgeted.
The following schedule reconciles the deficiency of revenues over expenditures from
the Statement of Revenues, Expenditures, and Changes in Fund Balances to the
budgetary comparison schedules.
HURF
Road Fund
Deficiency of revenues over expenditures from the Statement of
Revenues, Expenditures, and Changes in Fund Balances $ (1,598,822)
Present value of net minimum capital lease payments 1,300,000
Deficiency of revenues over expenditures from the budgetary
comparison schedules $ (298,822)
64
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65
Nonmajor Governmental Funds
SPECIAL REVENUE FUNDS
Health Care Accounts for a variety of health service programs funded by federal and state
grant funds, appropriations, fees and local government contributions.
Recorder's Surcharge Accounts for the collection of a special recording surcharge, not to exceed four
dollars, to be used to defray the cost of converting the County Recorder’s
document storage and retrieval system to micrographics or computer automation
as established by A.R.S. § 11-475.01.
Assessor’s Surcharge Accounts for the collection of a special recording surcharge, not to exceed four
dollars, to be used to defray the cost of converting the County Assessor’s
document storage and retrieval system to micrographics or computer automation
as established by A.R.S. § 11-269.06.
Public Library Provides and maintains library services for the residents of Yavapai County.
Operations are funded by a secondary tax levy.
School Educational services and programs administered by the County School
Superintendent.
Parks & Recreation Accounts for fees and grants used for construction, maintenance and operation of
parks.
Water Advisory
Committee
Accounts for local government contributions used to assess the current and future
supply of water.
Landfill / Environment Used to fund operations of transfer stations, waste tire operations and closure
costs of County landfills.
Public Works Accounts for highway user fees restricted to construction, repair and maintenance
of County roads.
C.D.B.G. Community Development Block Grant is a federal grant for construction of
facilities and acquisition of equipment for local non-profit and public entities.
Improvement Districts Administration of special districts for Street Lighting, Road and Sewer
improvements.
Clerk of Superior Court Accounts for statutory fees collected and used for document storage and
retrieval. Also fees used for “fill-the gap” purposes.
County Attorney Accounts for various programs administered by the County Attorney including
Anti-Racketeering, Victim Witness and Bad Check.
Law Enforcement Used for various law enforcement services and programs. Funding sources
include federal and state grants.
Emergency
Management
Accounts for programs administered by the Emergency Management department
used to provide services, equipment and supplies for law enforcement or other
agencies dealing with emergency response.
66
Probation Accounts for Adult and Juvenile Probation programs and services provided in
coordination with the Superior Court System.
Courts Accounts for statutory fees and surcharges related to the courts, and is used for
the processing of criminal cases as well as court enhancement and records
improvement.
Public Defender Provides training related seminars, books and materials for staff and attorneys.
Includes a state grant for indigent defense costs.
CAPITAL PROJECTS FUNDS
Juvenile Jail
Improvement
Accounts for state funded improvements for a new remanded juvenile jail facility.
Airport Development Airport enhancement projects for Seligman, Bagdad and Sedona funded by State
grants.
DEBT SERVICE FUNDS
The Debt Service Funds account for the accumulation of resources for the payment of principal and
interest on the revenue bonds issued for special assessment bonds for the Coyote Springs, Granite
Gardens and Pine Valley special assessment districts and the notes payable for the HELP loan and the
Prescott East special assessment district. Funding for the special assessment debt is provided by
assessments made against the benefiting owners.
67
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68
Yavapai County
Combining Balance Sheet
Nonmajor Governmental Funds
June 30, 2004
Special Revenue
Recorder's Assessor's Public
Assets Health Care Surcharge Surcharge Library
Cash and cash equivalents $ 1,541,839 $ 816,868 $ 380,893 $ 221,835
Receivables:
Property taxes - - - 91,278
Special assessments—
- - - -
Accounts 15,980 3,210 2,819 296
Due from:
Other funds 186,384 - - 79
Other governments 1,071 - - -
Prepaid items 3,925 - - -
Total assets $ 1,749,199 $ 820,078 $ 383,712 $ 313,488
Liabilities and Fund Balances
Liabilities:
Accounts payable $ 79,495 $ 27,879 $ - $ 11,844
Accrued payroll and employee benefits 200,010 1,622 8,765 13,970
Due to other funds 25,421 - - 193
Deferred revenue - - - 54,659
Total liabilities 304,926 29,501 8,765 80,666
Fund balances:
Reserved for:
Debt service - - - -
Unreserved, reported in
Special revenue funds 1,444,273 790,577 374,947 232,822
Capital project funds - - - -
Total fund balances 1,444,273 790,577 374,947 232,822
Total liabilities and fund balances $ 1,749,199 $ 820,078 $ 383,712 $ 313,488
69
Parks & Water Advisory Landfill /
School Recreation Committee Environment Public Works CDBG
$ 374,167 $ 973,629 $ 187,653 $ 394,036 $ 120,243 $ -
- - - - - -
- - - - - -
17,043 81,511 178 - 107 -
66,831 8,844 - 16,587 - -
22,360 - - 98,069 - 160,840
325 - - - - -
$ 480,726 $ 1,063,984 $ 187,831 $ 508,692 $ 120,350 $ 160,840
$ 44,595 $ 14,591 $ 80 $ 77,473 $ - $ 160,817
23,193 - 2,564 16,396 - -
68,548 99,587 - 22,873 1,116 -
- - - - - -
136,336 114,178 2,644 116,742 1,116 160,817
- - - - - -
344,390 949,806 185,187 391,950 119,234 23
- - - - - -
344,390 949,806 185,187 391,950 119,234 23
$ 480,726 $ 1,063,984 $ 187,831 $ 508,692 $ 120,350 $ 160,840
70
Yavapai County
Combining Balance Sheet
Nonmajor Governmental Funds
June 30, 2004
(Continued)
Special Revenue
Improvement Clerk of County Law
Assets Districts Superior Court Attorney Enforcement
Cash and cash equivalents $ 2,026,637 $ 337,681 $ 759,369 $ 615,509
Receivables:
Property taxes 160,571 - - -
Special assessments - - - -
Accounts 1,853 28,423 52,692 63,974
Due from:
Other funds - - 46,918 352
Other governments 15,678 - 26,870 74,267
Prepaid items - - 600 -
Total assets $ 2,204,739 $ 366,104 $ 886,449 $ 754,102
Liabilities and Fund Balances
Liabilities:
Accounts payable $ 623,800 $ 36 $ 19,058 $ 30,516
Accrued payroll and employee benefits 15,913 1,121 29,439 18,546
Due to other funds 5,411 - 9,182 59,516
Deferred revenue 93,564 - - -
Total liabilities 738,688 1,157 57,679 108,578
Fund balances:
Reserved for:
Debt service - - - -
Unreserved, reported in
Special revenue funds 1,466,051 364,947 828,770 645,524
Capital project funds - - - -
Total fund balances 1,466,051 364,947 828,770 645,524
Total liabilities and fund balances $ 2,204,739 $ 366,104 $ 886,449 $ 754,102
71
Emergency Public
Management Probation Courts Defender
$ - $ 329,853 $ 656,573 $ 180,406
- - - -
- - - -
44 58,746 34,463 978
- 37,605 6,638 214
282,916 38,577 96,805 33,367
- - 1,174 -
$ 282,960 $ 464,781 $ 795,653 $ 214,965
$ 44,765 $ 100,290 $ 24,513 $ -
673 131,399 26,618 1,079
6,717 47,962 3,823 175,886
- - - -
52,155 279,651 54,954 176,965
- - - -
230,805 185,130 740,699 38,000
- - - -
230,805 185,130 740,699 38,000
$ 282,960 $ 464,781 $ 795,653 $ 214,965
72
Yavapai County
Combining Balance Sheet
Nonmajor Governmental Funds
June 30, 2004
(Continued)
Capital Projects
Juvenile Jail Airport
Assets Improvement Development
Cash and cash equivalents $ 5,981 $ -
Receivables:
Property taxes - -
Special assessments - -
Accounts 2 6
Due from:
Other funds - -
Other governments - 26,158
Prepaid items - -
Total assets $ 5,983 $ 26,164
Liabilities and Fund Balances
Liabilities:
Accounts payable $ - $ 12,169
Accrued payroll and employee benefits - -
Due to other funds - -
Deferred revenue - -
Total liabilities - 12,169
Fund balances:
Reserved for: