The URL can be used to link to this page

CAFR Year End 09-30-2010COLLIER COUNTY, FLORIDA Comprehensive Annual Financial Report Year Ended September 30, 2010 The Comprehensive Annual Financial Report (CAFR) is prepared each year by the Clerk of the Circuit Court on behalf of Collier County government. On the cover: The map of Collier County, located in southwest Florida, with representations of many aspects of what goes into creating a comprehensive financial report. Source: Florida Center for Instructional Technology, Exploring Florida Maps (Tampa, FL: University of South Florida, 2008) Map Credit: Florida Center for Instructional Technology, University of South Florida. COMPREHENSIVE ANNUAL FINANCIAL REPORT FOR FISCAL YEAR ENDED SEPTEMBER 30, 2010 COLLIER COUNTY, FLORIDA BOARD OF COUNTY COMMISSIONERS FRED W. COYLE, CHAIRMAN - DISTRICT 4 FRANK HALAS, VICE - CHAIRMAN — DISTRICT 2 DONNA L. FIALA — DISTRICT 1 THOMAS K. HENNING — DISTRICT 3 JAMES N. COLETTA, Jr. — DISTRICT 5 COUNTY MANAGER LEO E. OCHS, Jr. COUNTY ATTORNEY JEFFREY A. KLATZKOW CLERK OF THE CIRCUIT COURT AND CHIEF FINANCIAL OFFICER DWIGHT E. BROCK DIRECTOR OF FINANCE AND ACCOUNTING CRYSTAL K. KINZEL Prepared by the Finance and Accounting Department THIS PAGE INTENTIONALLY LEFT BLANK 4-2 � � � � � P P � {\ ) {/ /u \ \/ l!/( uk\ .{§ of ) {0 af \ }§ _!3I \ \�) En �b(k f)2? « 2ƒ /�§ 1-2 E LT r; 0 0 Af \_ i /.2 §E §Eo {J ƒ |a E§, §eN ,2k0 _ E t o 0 0 K � » � kI �R|m /a }) ,2 %f� \)/ && 302 72, N qr® £ 0 « 2 'E � 0 \w)\ ) {/ /u \ \/ l!/( uk\ .{§ of ) {0 af \ }§ _!3I \ \�) En �b(k f)2? « 2ƒ /�§ 1-2 E LT r; 0 0 Af \_ i /.2 §E §Eo {J ƒ |a E§, §eN ,2k0 _ E t o 0 0 K � » � kI �R|m /a }) a ! _— \)/ �I ]f!;( |§ 72, �k} qr® £ 0 _ \�} � 0 \w)\ =u < ba -E \)k�a�� N %)k | § } o \ r E:�; !ƒIE � u )(§ E / / \N »!o ) {/ /u \ \/ l!/( uk\ .{§ of ) {0 af \ }§ _!3I \ \�) En �b(k f)2? « 2ƒ /�§ 1-2 E LT r; 0 0 Af \_ i /.2 §E §Eo {J ƒ |a E§, §eN ,2k0 _ E t o 0 0 K � » � kI �R|m /a }) }k§ 2\ a ! _— !0-0ƒ.� �I ]f!;( |§ 72, =o.9 qr® £ 0 }k§ 2\ _— kk § �I ]f!;( |§ 72, r ;B qr® — , _ }2 /\ — k ) 0 Vo ■ �I § 72, r ;B §Jk2kr _ }2 /\ — k ) \w)\ =u < ba -E )f 75 o | o \ \ r= ol E / / \N ] }1 {E z j J � \/ ■� ��. _w .2 & I k)k ! —� A E 75 ■ �I §kk } -kk 72, r ;B §Jk2kr _ £ — k ) =u < -E )f COLLIER COUNTY, FLORIDA COMPREHENSIVE ANNUAL FINANCIAL REPORT YEAR ENDED SEPTEMBER 30, 2010 TABLE OF CONTENTS INTRODUCTORY SECTION Page TransmittalLetter ............................................................................................................................................ ............................... i Certificateof Achievement ............................................................................................................................ ............................... vii FINANCIAL SECTION Report of Independent Certified Public Accountants ................................................................................... ............................... 1 Management's Discussion and Analysis ( Unaudited) ....................................................................... ............................... Basic Financial Statements: Statementof Net Assets .......................................................................................................................... ............................... 14 Statementof Activities ................................................................................................................................ .............................16 BalanceSheet — Governmental Funds ..................................................................................................... ............................... 18 Reconciliation of the Balance Sheet of Governmental Funds to the Statement of Net Assets ............. ............................... 19 Statement of Revenues, Expenditures and Changes in Fund Balances — Governmental Funds ............... .............................20 Reconciliation of the Statement of Revenues, Expenditures and Changes in Fund Balances of Governmental Fundsto the Statement of Activities ................................................................................................. .............................21 General Fund - Statement of Revenues, Expenditures and Changes in Fund Balances — Budget and Actual ( Non- GAAP) ..................................................................................................................................... ............................... 22 Community Redevelopment - Statement of Revenues, Expenditures and Changes in Fund Balances — Budgetand Actual (Non -GAAP) .............................................................................................................. ............................... 25 Statementof Net Assets — Proprietary Funds ............................................................................................ .............................26 Statement of Revenues, Expenses and Changes in Fund Net Assets — Proprietary Funds ....................... .............................28 Statement of Cash Flows — Proprietary Funds ........................................................................................... .............................29 Statement of Fiduciary Assets and Liabilities — Agency Funds ................................................................... .............................31 Notesto the Financial Statements ............................................................................................................. .............................33 RequiredSupplementary Information ........................................................................................................... .............................74 Combining and Individual Fund Financial Statements: Nonmaior Governmental Funds CombiningBalance Sheet ................................................................................................................................ .............................80 Combining Statement of Revenues, Expenditures and Changes in Fund Balances ........................................ .............................90 Combining Schedule of Revenues, Expenditures and Changes in Fund Balances - Budget and Actual (Non- GAAP) ..............100 Nonmaior Enterprise Funds Combining Statement of Net Assets ........................................................................................................... ............................... 124 Combining Statement of Revenues, Expenses and Changes in Fund Net Assets ....................................... ............................... 125 CombiningStatement of Cash Flows ................................................................................ ............................... ............................126 Internal Service Funds CombiningStatement of Net Assets ........................................................................................................... ............................... 130 Combining Statement of Revenues, Expenses and Changes in Fund Net Assets ....................................... ............................... 131 CombiningStatement of Cash Flows ........................................................................................................... ............................... 132 Fiduciary Funds Combining Statement of Fiduciary Assets and Liabilities ........................................................................... ............................... 136 Combining Statement of Changes in Assets and Liabilities ............................................. ............................... ............................137 Component Units CombiningStatement of Net Assets ........................................................................................................... ............................... 140 Combining Statement of Revenues, Expenditures and Changes in Net Assets .............. ............................... ............................141 COLLIER COUNTY, FLORIDA COMPREHENSIVE ANNUAL FINANCIAL REPORT YEAR ENDED SEPTEMBER 30, 2010 TABLE OF CONTENTS - CONTINUED STATISTICAL SECTION (UNAUDITED) NetAssets by Component ................................................................................................ ............................... ............................144 Changein Net Assets ................................................................................................................................... ............................... 145 Governmental Activities Tax Revenues by Source ........................................................... ............................... ............................148 Fund Balances of Governmental Funds ...................................................................................................... ............................... 149 Changes in Fund Balances of Governmental Funds ...........................:........................................................ ............................... 150 Assessed Value and Estimated Actual Value of Taxable Property .............................................................. ............................... 152 Property Tax Rates —All Direct and Overlapping Governments ................................................................. ............................... 153 PrincipalTax Payers County- Wide ............................................................................................................... ............................... 154 PropertyTax Levies and Collections ............................................................................................................ ............................... 155 Ratiosof Outstanding Debt by Type ........................................................................................................... ............................... 156 Ratios of General Bonded Debt Outstanding .............................................................................................. ............................... 157 LegalDebt Margin Information ................................................................................................................... ............................... 158 Direct and Overlapping Governmental Activities Debt ............................................................................... ............................... 158 Pledged- Revenue Coverage ......................................................................................................................... ............................... 159 Demographic and Economic Statistics ........................................................................................................ ............................... 160 PrincipalEmployers ..................................................................................................................................... ............................... 161 Full -Time Equivalent County Employees by Function ................................................................................. ............................... 162 OperatingIndicators by Function ................................................................................................................ ............................... 163 CapitalAsset Statistics by Function ............................................................................................................. ............................... 164 SINGLE AUDIT /SCHEDULE OF EXPENDITURES OF FEDERAL AWARDS AND STATE PROJECTS Report on Internal Control Over Financial Reporting and on Compliance and Other Matters Based on an Audit of the Financial Statements Performed in Accordance with Government Auditing Standards ................167 Report of Independent Certified Public Accountants on Compliance With Requirements Applicable to Each Major Federal Program and State Project and on Internal Control Over Compliance in Accordance With OMB Circular A -133, Section 215.97, Florida Statutes, and Chapter 10.550, Rules of the Auditor General ........ ............................169 Schedule of Expenditures of Federal Awards and State Projects .................................... ............................... ............................172 Notes to the Schedule of Expenditures of Federal Awards and State Projects .............. ............................... ............................178 Schedule of Findings and Questioned Costs .................................................................... ............................... ............................181 Scheduleof Prior Audit Findings ...................................................................................... ............................... ............................197 THIS PAGE INTENTIONALLY LEFT BLANK Coun o Ilier CLERK OF ' COURT COLLIER COUNTY OURT - USE Dwight E. Brock 3299 TAMIAMI TRAIL ST, SL TE #403 Clerk of Courts Clerk of Courts NAPLES, FLO 'A 34112 Accountant \,Y� ) Auditor Custodian of County Funds March 8, 2011 To the Citizens and Members of the Board of County Commissioners, Collier County, Florida It is with extreme pleasure that we present to you, the citizens of Collier County and members of the Board of County Commissioners, the Comprehensive Annual Financial Report (CAFR) for the fiscal year ended September 30, 2010. Responsibility for the accuracy of the data and the completeness and fairness of the presentation, including all disclosures, rests with the Board of County Commissioners and County management. The Clerk of the Circuit Court's Finance and Accounting Department, as well as County management, is responsible for establishing and maintaining internal controls to provide reasonable, but not absolute, assurance regarding the safeguarding of assets against loss from unauthorized use or disposition, the reliability of financial records for preparing financial statements, and maintaining accountability of assets. The concept of reasonable assurance recognizes that the cost of a control should not exceed the benefits likely to be derived, and the evaluation of costs and benefits requires estimates and judgments by management. The Clerk is not capable of representing that the internal controls of the County provide reasonable assurance as his office was precluded from examining those controls as a result of a dispute regarding the role of the Clerk of the Circuit Court as County Auditor. On November 10, 2010 the Florida Supreme Court dismissed the appeal of the Board of County Commissioners of Collier County v. Dwight Brock, and in doing so, reaffirmed the right of Clerk of Courts, Dwight Brock to audit all public funds used in county operations. The Florida Supreme Court upheld an earlier decision by the Florida Second District Court of Appeals issued on September 23, 2009. It is the Clerk's intention to reconstitute its auditing role during the fiscal year 2010 — 2011. Chapter 218.39 of the Florida Statutes requires an independent certified public accountant's financial audit of counties in the State. For the fiscal year ended September 30, 2010, the report of the independent auditor, Ernst and Young LLP, is included in the Financial Section of this report. In addition to meeting the requirements set forth in State statutes, the audit was also designed to meet the requirements of the Federal 1996 Single Audit Act Amendments and the related OMB Circular A -133. Phone (239) 252 -2646 Fax (239) 252 -2755 Website: www.collierclerk.com Email: collierclerk@collierclerk.com The Florida Single Audit is required by Florida Statute 215.97. Information relating to the Single Audits, including the schedule of expenditures of federal awards and state projects and the independent auditors' report on compliance and internal control over compliance with requirements applicable to each major federal and state program, are included in the Federal and State Single Audit Section of this report. Governmental accounting and auditing principles 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 compliment MD &A and the two should be read in concert. Collier County's MD &A can be found in the Financial Section immediately following the independent auditors' report. PROFILE OF THE GOVERNMENT Collier County is a Constitutional form of government and was established in 1923 under the Constitution and the laws of the State of Florida. The Board of County Commissioners is the legislative body for Collier County and is made up of five residents elected by voters. In addition to the County Commissioners, voters elect the following five constitutional officers: the Clerk of the Circuit Court, Property Appraiser, Sheriff, Supervisor of Elections and Tax Collector. Services provided by Collier County include public safety, emergency management, transportation services, water and wastewater services, parks, libraries and solid waste collection and disposal. Budgets are prepared annually. Formal budgetary integration is employed as a management control device during the year. The Board of County Commissioners conducts budget workshops during June of each year. The Board's proposed budget is released by July 15, in accordance with Florida Statutes. The budgets of Constitutional Officers are presented to the appropriate authorizing bodies according to state statute. Public hearings are held in September to allow taxpayer input and to adopt the budget as final. The General Fund ad valorem tax millage for fiscal year 2010 increased by .4176 from 3.1469 the previous fiscal year to 3.5645 in FY -10. The General Fund ad valorem tax millage for fiscal year 2008 was reduced to 9% below the rolled back millage rate, (the rate which generates the same tax revenue as levied in the previous year, exclusive of new construction) in accordance with property tax reform measures adopted during a special legislative session. On January 29, 2008 Florida voters approved statutory revisions that included increases to the homestead exemption, portability of Save Our Homes tax breaks up to $500,000, a 10% cap on future assessment increases for non - homesteaded property starting in 2009 and a new tangible equipment exemption of $25,000. ii ECONOMIC CONDITION AND OUTLOOK Collier County, the state's largest county at 2,026 square miles, is on the southwest coast of Florida, directly west of Miami. With a 2010 population of 331,800 (a 44 percent increase over the 2000 level), the County has been considered to be one of the fastest growing counties in the state over the last ten years. The County's economic base is concentrated in tourism and agriculture, fishing, ranching and forestry with a growing services economy and an emerging high technology sector. Gulf of Mexico beaches and the Everglades National Park are important attractions to this area. Taxable property market valuation for fiscal year 2010 totaled just under $70 billion, or a very high $210,900 per capita. Unemployment levels in recent years approximate, or are slightly above, the statewide average. The 2009 annual County unemployment rate stood at 12.2 %, while the statewide average is 11.6 %. Income levels are high, with a per capita personal income of $62,559. The County's financial operations have been managed with recurring General Fund operating surpluses contributing to historically strong cash and General Fund balance positions. This trend has been negatively impacted by property tax legislation and a general slowing of the economy. The County's millage for General Fund operations in fiscal year 2010 remained at only 35% of the statutory 10 mill limit, or $3.56 per thousand dollars of taxable value. Relevant financial policies include the appropriation of carryforward as revenue in the following year, budgeting revenues with a 5% reserve, recommended General Fund unreserved fund balance of between 10% and 15% of actual expenditures, the maximization of impact fees as allowed by law and the use of gas taxes for the Road Construction Capital Improvement Program. The Collier County debt policy provides for a maximum ratio of total general governmental debt service to bondable revenues from current sources of 13 %. The major focus of the Capital Improvement Plan for FY -11 will be to complete the transportation network, public service and life, health and safety related projects initiated over the past few years. Funding for road construction will be provided by remaining unspent Road Construction Fund monies and road impact fees. Water and wastewater projects will be focused on maintenance and will be funded primarily by water and wastewater user fees. LONG TERM FINANCIAL PLANNING Long term financial planning in Collier County focuses on the provisions of the Local Government Comprehensive Planning and Land Development Regulation Act. The provisions of this Act require that local government comprehensive plans include a Capital Improvement Element (CIE). The CIE is a planning document that identifies public facilities that will be required during the next five or more years. The Capital Improvement Element is the foundation of Collier County's annual Capital Improvement iii Program (CIP). Included in the County's current CIP for fiscal years 2011 -2015 are approximately $140 million for transportation projects and approximately $262 million for water and wastewater facilities and various replacement and rehabilitation projects. Parks and recreation projects of approximately $39 million are planned, as well as $33 million for tourist development and green space projects. Less than one percent of the fiscal year 2011 — 2015 Capital Improvement Program is funded by bond or loan proceeds. In summary, the multi -year implications of tax reform, continuing declines in property tax values, volatile state shared revenues and unstable permitting revenues have changed the priorities of Collier County. The continued decrease in property taxable values was not, however, unanticipated. Reduction of recurring costs, realignment of operations for purposes of efficiency and the reduction or deferral of capital expenditures is now the primary focus. New home construction is hampered by the number of existing homes available and a growing number of foreclosures. The overall housing market remains relatively soft, however there continues to be activity in the high end real estate market. State budget issues are a further concern, with competitive regional tourism coupled with sales tax volatility creating an environment for unstable state revenues. Historically, Collier County's economy has proven to be better insulated from economic downturns than other Florida counties, or the nation. Future years will be challenging, given the current issues in the housing market and the state budget, inflationary concerns, and revenue limitations imposed by tax reform. CASH MANAGEMENT The Finance and Accounting Department monitors the daily cash needs of the County and invests the County's portfolio in accordance with the County's written investment policy. The primary objective of the investment policy is the preservation of capital and the protection of investment principal. Authorized investments include certificates of deposit, the Local Government Funds Surplus Trust Fund, U.S. treasury securities, U.S. agency securities, commercial paper and bankers' acceptances. The weighted average maturity of the total managed portfolio was .39 years, not including overnight deposits, as of September 30, 2010. The average yield for fiscal year 2010 was .87 %, on an accrual basis, which constitutes a significant reduction from historical rates. Changes in the fair value of investments are recorded as part of interest income in the financial statements. OTHER DISCUSSION For the past several years the Clerk of the Circuit Court has been involved in certain litigation with Collier County. All litigation with the County was resolved, through mutual agreement, as of the end of fiscal year 2009 with the exception of case #2D07- 4549: L.T. #04- 941 -CA reaffirming that the Clerk of Courts is accountant, auditor and custodian of all county funds and is entitled to audit the county for purposes of determining legality of payment. The Board of County Commissioners elected to go forward with this case before the Florida Supreme Court. iv On September 2, 2010 the case was presented before the Florida Supreme Court. On November 10, 2010 the Florida Supreme Court dismissed the appeal of the Board of County Commissioners of Collier County v. Dwight Brock and in doing so reaffirmed the right of Clerk of Courts, Dwight Brock to audit all public. funds used in county operations. The Florida Supreme Court let stand the earlier decision by The Florida Second District Court of Appeals issued on September 23, 2009. AWARDS GFOA Certificate of Achievement: The Government Finance Officers Association of the United States and Canada (GFOA) awarded a Certificate of Achievement for Excellence in Financial Reporting to Collier County, Florida for its Comprehensive Annual Financial Report (CAFR) for the fiscal year ended September 30, 2009. The Certificate of Achievement is a prestigious national award, recognizing conformance with the highest standards for preparation of state and local government financial reports. In order to be awarded a Certificate of Achievement, a government unit must publish an easily readable and efficiently organized Comprehensive Annual Financial Report whose contents conform to program standards. The CAFR must satisfy both generally accepted accounting principles and applicable legal requirements. A Certificate of Achievement is valid for a period of one year only. Collier County has received this award for the past twenty -four years, from fiscal year 1986 to 2009. We believe our current report conforms to the Certificate of Achievement program requirements, and we are submitting it to the GFOA for consideration for an award again this year. Distinguished Budget Presentation Awards: The Government Finance Officers Association of the United States and Canada presented an award for Distinguished Presentation to Collier County for its annual budget for the fiscal year beginning October 1, 2009. In order to receive this award, a government unit must publish a budget document that meets program criteria as a policy document, as an operations guide, as a financial plan, and as a communications device. The Distinguished Budget Presentation Award is valid for a period of one year only. Collier County has received this award for the last twenty -one consecutive years. The Government Finance Officers Association of the United States and Canada presented an award for Distinguished Presentation to the Office of the Collier County Clerk of the Circuit Court for its annual budget for the fiscal year beginning October 1, 2009. In order to receive this award, a government unit must publish a budget document that meets program criteria as a policy document, as an operations guide, as a financial plan, and as a communications device. The Distinguished Budget presentation Award is valid for a period of one year only. The Clerk's Office has received this award for the last nine consecutive years. V ACKNOWLEDGEMENTS The preparation and publication of this Comprehensive Annual Financial Report represents a significant effort by the Finance and Accounting Department as well as numerous County personnel who contribute to its production. In particular we would like to express our appreciation to Kelly Jones, CGFO, Edith Manuel, CPA, Precious Corrado, June Wathen, Liz Willis, Suzanne Boothby, Dan Tripaldi, Ashley Pearson and Karen Oberrath, all Accountants, along with Constance Murray, CGFO, General Operations Manager, Raymond Milum, Jr., Clerk's Fiscal Operations Manager and Nancy Fragione, Senior Financial Specialist, and all of the staff of the Finance and Accounting Department. Sincere appreciation is also expressed to Ernst and Young LLP, the Board of County Commissioners, the Constitutional Officers, the County Manager, Division Administrators and the Department Directors for their assistance throughout the year in matters pertaining to the financial affairs of the County. We hope you find this report informative, accurate and easily readable. If you should have any questions related to this report or if additional information is desired, do not hesitate to contact Crystal K. Kinzel, Director of Finance and Accounting, at (239) 252- 6299. *Dwight. uit Court Chief Financial Officer Cry81K. Kinzel Deputy Clerk Directoy,of Fyhance and Accounting er M. Johnssen, CPA eputy Clerk General Accounting Manager V1 Certificate of Achievement for Excellence in Financial Reporting Presented to Collier County Clerk of the Circuit Court Florida For its Comprehensive Annual Financial Report for the Fiscal Year Ended September 30, 2009 A Certificate of Achievement for Excellence in Financial Reporting is presented by the Government Finance Officers Association of the United States and Canada to government units and public employee retirement systems whose comprehensive annual financial reports (CAFRs) achieve the highest standards in government accounting and financial reporting. President "t 0 Executive Director Certificate of Achievement for Excellence in Financial Reporting The Government Finance Officers Association of the United States and Canada (GFOA) awarded a Certificate of Achievement for Excellence in Financial Reporting to Collier County, Florida for its comprehensive annual financial report for the fiscal year ended September 30, 2009. This was the twenty -fourth consecutive year that the government has achieved this prestigious award. In order to be awarded a Certificate of Achievement, a government must publish an easily readable and efficiently organized comprehensive annual financial report. This report must satisfy both generally accepted accounting principles and applicable legal requirements. A Certificate of Achievement is valid for a period of one year only. We believe that our current comprehensive annual financial report continues to meet the Certificate of Achievement Program's requirements and we are submitting it to the GFOA to determine its eligibility for another certificate. FINANCIAL SECTION THIS PAGE INTENTIONALLY LEFT BLANK El FRNST &' 'DUNG Suite OOoung LLP 5100 Town Center Circle Boca Raton, Florida 33486 Tel: +1 561 955 8000 Fax: +1 561 955 8200 www.ey.com Report of Independent Certified Public Accountants Distinguished Members of the Board of County Commissioners Collier County, Florida: We have audited the accompanying financial statements of the governmental activities, the business -type activities, the aggregate discretely presented component units, each major fund, and the aggregate remaining fund information of Collier County, Florida (the County), as of and for the year ended September 30, 2010, which collectively comprise the County's basic financial statements as listed in the table of contents. These financial statements are the responsibility of the County's management. Our responsibility is to express opinions on these financial statements based on our audit. We conducted our audit in accordance with auditing standards generally accepted in the United States and the standards applicable to financial audits contained in Government Auditing Standards, issued by the Comptroller General of the United States. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. We were not engaged to perform an audit of the County's internal control over financial reporting. Our audit included consideration of internal control over financial reporting as a basis for designing audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the County's internal control over financial reporting. Accordingly, we express no such opinion. An audit also includes 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. We believe that our audit provides a reasonable basis for our opinions. In our opinion, the financial statements referred to above present fairly, in all material respects, the respective financial position of the governmental activities, the business -type activities, the aggregate discretely presented component units, each major fund, and the aggregate remaining fund information of the County as of September 30, 2010, and the respective changes in financial position and, where applicable, cash flows thereof, and the respective budgetary comparison information for the general fund and community redevelopment fund for the year then ended in conformity with US generally accepted accounting principles. In accordance with Government Auditing Standards, we have also issued our report dated February 22, 2011 on our consideration of the County's internal control over financial reporting and on our tests of its compliance with certain provisions of laws, regulations, contracts, and 1102 - 1231597 4 m_mber firm of Ern.A 3 Vcjno- -, uNnl Unfia�, iIIIIIIWi� " " "' JExNSrsYOUNc grant agreements and other matters. The purpose of that report is to describe the scope of our testing of internal control over financial reporting and compliance and the results of that testing, and not to provide an opinion on the internal control over financial reporting or on compliance. That report is an integral part of an audit performed in accordance with Government Auditing Standards and should be considered in assessing the results of our audit. The Management's Discussion and Analysis on pages 3 through 13 and schedule of funding progress for the retiree health plan on page 74 are not a required part of the basic financial statements but are supplementary information required by the Governmental Accounting Standards Board. We have applied certain limited procedures, which consisted principally of inquiries of management regarding the methods of measurement and presentation of the required supplementary information. However, we did not audit the information and express no opinion on it. Our audit was conducted for the purpose of forming opinions on the financial statements that collectively comprise the County's basic financial statements. The introductory section, combining and individual nonmajor fund financial statements, and statistical section are presented for purposes of additional analysis and are not a required part of the basic financial statements. The accompanying schedule of expenditures of federal awards and state projects is presented for purposes of additional analysis as required by the U.S. Office of Management and Budget Circular A -133, Section 215.97, Florida Statutes and Chapter 10.550, Rules of the Auditor General, and is not a required part of the basic financial statements. The combining and individual nonmajor fund financial statements and the schedule of expenditures of federal awards and state projects have been subjected to the auditing procedures applied in the audit of the basic financial statements and, in our opinion, are fairly stated in all material respects in relation to the basic financial statements taken as a whole. The introductory section and statistical section have not been subjected to the auditing procedures applied in the audit of the basic financial statements and, accordingly, we express no opinion on them. 16� -f t"7 UP February 22, 2011 1102- 1231597 2 MANAGEMENT'S DISCUSSION AND ANALYSIS (UNAUDITED) As Clerk of the Circuit Court and chief financial officer of Collier County, Florida, I present the readers of the County's financial statements this narrative overview and analysis of the financial activities of Collier County for the fiscal year ended September 30, 2010. Readers are encouraged to consider the information presented in this narrative in conjunction with additional information offered in the letter of transmittal, found on pages i -vi of this report. Financial Highlights - Collier County's assets exceeded its liabilities as of September 30, 2010 by $2,434,545,233. Of this amount, $359,425,041 represents unrestricted net assets and may be used to meet future obligations. - The County's total net assets increased by $36,270,742 over fiscal year 2009, with $22,228,643 of the increase resulting from governmental activities and $9,042,099 resulting from business - type activities. - As of September 30, 2010 Collier County's governmental fund financial statements showed combined ending fund balances of $410,216,427, an increase of $251 over the previous fiscal year. Of the total combined ending fund balance, $267,751,647 remains in the various governmental funds of Collier County as unreserved. - The General Fund reported an unreserved fund balance of $59,705,240 at September 30, 2010, an increase of $20,781,489 compared to September 30, 2009. - Total net bonded debt and outstanding loans owed by Collier County decreased by $39,897,193 during fiscal year 2010, with a decrease in net governmental activities debt of $34,279,834 and a decrease in the net business -type activities debt of $5,617,359. In February of 2010 the County prepaid $6,154,000 in variable rate commercial paper debt. In July of 2010 the remaining commercial paper balance of $59,893,000 was refinanced by the fixed rate Series 2010 Special Obligation Revenue Bonds. The Bayshore /Gateway Community Redevelopment Agency prepaid $1,114,000 of taxable variable rate debt during the period. During fiscal year 2010, the Collier County Water and Sewer District refinanced all outstanding Series 1999B Refunding Revenue Bonds. The Collier County Water and Sewer District also borrowed $6,492,630 from the Florida Department of Environmental Protection's State Revolving Fund Program. Overview of the Financial Statements This discussion and analysis is intended to serve as an introduction and explanation of Collier County's basic financial statements, comprised of government -wide and fund financial statements, as well as notes to the financial statements. There is additional supplementary information following these financial statements that may be of interest to the reader. Government -Wide Financial Statements Government -wide financial statements are designed to provide the reader an overview of the financial position of the County and are similar to private sector financial statements. These statements are 3 comprised of a Statement of Net Assets and a Statement of Activities and are found on pages 14 to 17 of this report. The Statement of Net Assets shows the financial position of Collier County as of September 30, 2010. The statement shows the County's assets less its liabilities, with the difference being reported as net assets. Changes in net assets are useful indicators of financial condition. The Statement of Activities follows the statement of net assets and reports the changes in net assets over the fiscal period. All changes in net assets are reported as soon as the underlying events that gave rise to the change occur, regardless of the timing of the related cash flows. Thus, revenues and expenses are reported for some items, such as accounts receivable, notes receivable or accrued unused vacation and sick leave, that will manifest themselves in cash inflows and outflows, respectively, in future fiscal periods. These statements distinguish Collier County functions that are supported by taxes and intergovernmental revenues (governmental activities), from business -type activities, which are intended to have their costs primarily recovered through user fees and charges. Governmental activities reported in the financial statements are general government, public safety, physical environment, transportation, economic environment, human services and culture and recreation. Business -type activities in Collier County include water and sewer, solid waste collections, airport operations, transit operations and emergency medical services. Fund Financial Statements A fund is a group of related accounts used to maintain control over resources that have been segregated to meet specific objectives. As dictated by generally accepted accounting principles, Collier County uses fund accounting to ensure and demonstrate compliance with financial legal requirements. The funds of the County can be divided into the following three categories: governmental, proprietary and fiduciary. Governmental funds - Governmental funds, presented on pages 18 to 25, account for substantially the same functions as governmental activities reported under the Government -Wide Statement of Net Assets and Statement of Activities. The difference is that the governmental fund financial statements focus on inflows and outflows of expendable resources, as well as balances of expendable resources available at the end of the fiscal year, on a near term basis. As such, these statements present a narrower view of financial condition, but are nonetheless useful in evaluating Collier County's near term financing requirements and available resources. Comparison between the two sets of financial statements allows the reader to better assess the future impact of the government's near term financial decisions. Both the governmental fund balance sheet and the statement of revenues, expenditures and changes in fund balances provide a reconciliation to the respective government -wide financial statements to facilitate comparison. Governmental funds presented individually in Collier County's statements include three major funds, the General Fund, Government Facilities Impact Fee Fund and the Community Redevelopment Fund. While there are many smaller governmental funds under Collier County management, they are aggregated in a total column named "other governmental funds ". Combining statements for these other governmental funds have been presented elsewhere in this report. 4 Proprietary funds - Collier County maintains two different types of proprietary funds, enterprise and internal service, which are reflected on pages 26 to 30 of this report. Enterprise funds report, with more detail, the same functions presented as business -type activities in the government -wide financial statements for water and sewer, Goodland water, solid waste disposal, emergency medical services, transit and the airport authority. The Collier County Water and Sewer District Fund is presented individually as a major fund. Internal service funds are maintained to allocate and accumulate costs internally for Collier County. The County uses internal service funds to account for health insurance, worker's compensation insurance, property and casualty insurance, fleet operations and information technology. The internal service funds are presented in total in the proprietary fund financial statements, but may be viewed on a combining basis elsewhere in the report. Fiduciary funds - Fiduciary funds are used to account for resources held for the benefit of parties outside of Collier County government. These funds are not presented in the government -wide financial statements as they do not represent resources available to support Collier County functions. The fiduciary funds are presented on page 31 of this report. All of the County's fiduciary funds are agency funds. The accounting used for agency funds is based on the concept that assets equal liabilities when the government is acting in a fiduciary capacity. Notes to the Financial Statements The notes provide additional information essential to a full understanding of the data provided in both the government -wide and fund financial statements. The notes appear on pages 34 to 72 of this report. Other Information The combining and individual nonmajor fund financial statements and schedules mentioned above present more detailed views of nonmajor governmental and enterprise funds and begin on page 80. This section contains combining balance sheets and statements of revenues, expenditures and changes in fund balance for governmental funds, including budgetary comparisons, and combining balance sheets and statements of revenues, expenses and changes in fund net assets for enterprise funds. Also included are combining financial statements for internal service and agency funds. Additional information about the County, which may be of interest to the reader, can be found under the Statistical and Single Audit sections of this report. Government -Wide Financial Analysis Changes in net assets over time are a useful indicator in assessing financial condition. Collier County's increase in net assets for the fiscal years ending September 30, 2010 and 2009 amounted to $36,270,742 and $68,887,651, respectively. Collier County's rate of growth continued to decline during fiscal year 2010 and this is an indication that the country's overall economic situation has had an impact on the County. Positive balances were reported in all categories of net assets in the governmental and business -type activities for fiscal year 2010, as well as fiscal year 2009. Collier County's net assets at September 30, 2010 increased $17,561,395 for unrestricted net assets and decreased $1,107,918 for restricted net 5 assets. Restricted net assets are resources subject to external restriction on how they may be used while unrestricted net assets may be used to meet the County's ongoing obligations. Collier County's investment in capital assets such as land, roads, buildings, parks and machinery and equipment, net of depreciation or any outstanding debt related to the asset, amounts to 74.1% of net assets as of September 30, 2010, compared to 74.4% as of September 30, 2009. Capital assets are used to provide services to the citizens and consequently do not represent spendable resources. As such, the capital assets themselves cannot be used to liquidate the debt incurred to purchase or construct the capital assets. Following are Collier County's net assets and changes in net assets for the fiscal years ended September 30, 2009 and 2010, shown in condensed form: 6 Collier County's. Schedule of Net Assets (in millions) Tota I Governmental Business -type Percentage Activities Activities Total Change 2010 2009 2010 2009 2010 2009 2009 -2010 Current and other assets $ 513.4 $ 536.4 $ 226.4 $ 200.0 $ 739.8 $ 736.4 0.5% Capital assets, net 1,651.3 1,644.7 891.6 914.2 2,542.9 2,558.9 (0.6 %) Total assets 2,164.7 2,181.1 1,118.0 1,114.2 3,282.7 3,295.3 (0.4 %) Long -term liabilities 471.7 510.0 246.5 252.8 718.2 762.8 (5.8 %) Current liabilities 101.4 106.8 28.5 27.4 129.9 134.2 (3.2 %) Total liabilities 573.1 616.8 275.0 280.2 848.1 897.0 (5.5 %) Net assets: Invested in capital assets, net of related debt 1,169.1 1,131.6 635.7 653.3 1,804.8 1,784.9 1.1% Restricted 232.6 240.2 37.8 31.3 270.4 271.5 (.4 %) Unrestricted 189.9 192.5 169.5 149.4 359.4 341.9 5.1% Total net assets $1,591.6 $1,564.3 $ 843.0 $ 834.0 $2,434.6 $2,398.3 1.5% 6 Collier County's Schedule of Changes in Net Assets (in millions) 7 Total Governmental Business -type Percentage Activities Activities Total Change 2010 2009 2010 2009 2010 2009 2009 -2010 Revenues Program revenues: Charges for services $ 56.3 $ 58.8 $154.7 $156.7 $ 211.0 $ 215.5 (2.1 %) Operating grants and contributions 31.9 22.0 4.4 3.3 36.3 25.3 43.5% Capital grants and contributions 25.8 24.9 10.4 18.2 36.2 43.1 (16.0 %) General revenues: Property taxes 299.4 313.3 - - 299.4 313.3 (4.4 %) Other taxes and shared revenues 76.1 77.9 - - 76.1 77.9 (2.3 %) Interest income 4.7 11.2 1.6 2.2 6.3 13.4 (53.0 %) Miscellaneous 8.0 12.0 0.1 0.6 8.1 12.6 (35.7 %) Total revenues 502.2 520.1 171.2 - 181.0 673.4 701.1 (4.0 %) Expenses General government 100.5 114.0 - - 100.5 114.0 (11.8 %) Public safety 179.2 182.9 - - 179.2 182.9 (2.0 %) Physical environment 16.8 21.3 - - 16.8 21.3 (21.1 %) Transportation 76.6 64.6 - - 76.6 64.6 18.6% Economic environment 11.1 12.1 - - 11.1 12.1 (8.3 %) Human services 13.0 12.0 - - 13.0 12.0 8.3% Culture and recreation 46.9 45.7 - - 46.9 45.7 2.6% Interest on long -term debt 19.5 20.5 - - 19.5 20.5 (4.9 %) Water and sewer - - 103.3 90.0 103.3 90.0 14.8% Solid waste - - 27.4 30.8 27.4 30.8 (11.0 %) Airport authority - - 4.4 3.9 4.4 3.9 12.8% Emergency medical services - - 28.8 28.7 28.8 28.7 0.3% Mass transit - - 9.6 9.0 9.6 9.0 6.7% Total expenses 463.6 473.1 173.5 162.4 637.1 635.5 0.3% Increase in net assets before nettransfers and special item 38.6 47.0 (2.3) 18.6 36.3 65.6 (44.7 %) Special item - registry bond - 3.3 - - - 3.3 (100.0 %) Transfers, net (11.3) (12.6) 11.3 12.6 - - - Changeinnetassets 27.3 37.7 9.0 31.2 36.3 68.9 (47.3 %) Netassets- beginning, as restated 1,564.3 1,526.6 834.0 802.8 2,398.3 2,329.4 3.0% Netassets -ending $1,591.6 $1,564.3 $843.0 $834.0 $2,434.6 $2,398.3 1.5% 7 Governmental Activities The current year increase for net assets of governmental activities amounted to $27,228,643, an increase of 1.8% over the previous year's net assets. The previous fiscal years' increase was 2.5% and this declining rate of growth is the result of a continued decline in overall governmental activities revenues. Fiscal year 2010 reflects decreases in charges for services, property taxes, other taxes and shared revenues as well as interest and miscellaneous revenues. The total ad valorem tax collections for fiscal year 2010 were down $13,901,502, or 4.4%, primarily due to an 11.0% decrease in taxable assessed value. Decreases in expenses occurred in most areas of governmental activity in fiscal year 2010, with the largest decrease in transportation, followed closely by general government. The decreased spending across the government functions is a result of the County's efforts to manage the basic needs of the citizenry while facing declining property tax revenues. Decreased personnel costs were a major component of the current year savings. Governmental activities interest expense net of amortizations was $19,475,226 for fiscal year 2010, a decrease of 5% compared to fiscal year 2009. Business -type Activities Increases in net assets related to business -type activities amounted to $9,042,099 in the aggregate, representing a 1.1% increase over the previous year's net assets. The majority of the increase, or $7,245,478, can be attributed to the Collier County Water and Sewer District. Total water, wastewater and reuse irrigation operating revenues decreased $3,879,757, or 3.7 %, over the previous fiscal year, while costs of operations, excluding depreciation, increased by 2.3 %. Operating revenues decreased primarily due to decreased usage caused by continued water restrictions, conservation measures and home vacancies. Fiscal year 2010 water and wastewater impact fee collections were $7,259,306, or an increase of 14.9% versus fiscal 2009. County Water and Sewer District charges water and wastewater impact fees on new construction in order to finance growth necessitated capital expansion. Overall, the Water and Sewer District experienced a 45.8% decrease in capital grants and contributions, mainly due to a decrease in developer donations of water and wastewater infrastructure. Operating expenses increased as the Water and Sewer District's focus has shifted from capital expansion to maintenance and optimization of existing facilities. Depreciation expense increased by 5.8% over fiscal year 2009 as over $105M in capital improvements and facilities added in fiscal year 2009 were depreciated for a full year. The County Water and Sewer District also recognized the impairment of the South Reverse Osmosis Raw Water Wellfield in the amount of $9,247,207. For more information, please see the footnotes to these financial statements. Solid waste charges for services increased by 1.7% from fiscal year 2009 while operating costs, including depreciation, decreased by 11.4% over the same period. The increase in solid waste charges for services can be mainly attributed to an 8.0% increase in the commercial tipping fee and a 6.0% increase in the residential tipping fee. Operating costs declined mainly due to a 12.8% decrease in total commercial, residential and construction related tonnage being accepted into the landfills during FY -2010. These factors contributed to an increase in solid waste net assets year on year of $4,614,672. 8 Fund Financial Statement Analysis As mentioned above, Collier County utilizes fund accounting to ensure compliance with finance related legal requirements. Governmental Funds Governmental funds provide information on near term inflows, outflows and balances of spendable resources. Unreserved fund balance is a useful measure of net resources available to be spent at the end of the fiscal year. Governmental funds consist of the General Fund, Special Revenue Funds, Debt Service Funds and Capital Project Funds. As of September 30, 2010 Collier County governmental funds reported combined fund balances of $410,216,427, an increase of $251 when compared to prior year combined fund balances. Governmental funds reserved $74,625,000 of fund balance for encumbrances in the next fiscal year, $17,862,784 for inventory and prepaid items, $4,567,076 for debt service and $45,384,925 for advances made to other funds. The remainder of fund balance is considered unreserved and available for discretionary spending. The following were noteworthy activities and changes relating to the major governmental funds for fiscal year 2010: The General Fund is the primary operating fund of Collier County. At September 30, 2010, total fund balance in the general fund was $71,374,611, of which $59,705,240 was unreserved. As a percentage of total general fund expenditures and net transfers, the unreserved portion is 21.7 %. The total fund balance increased by $23,460,476 or 49.0 %, compared to the September 30, 2009 total fund balance. The increase in total fund balance is primarily due to decreased operating transfers from the General Fund to the Other Governmental Funds. The Government Facilities Impact Fee Fund accounts for the receipt and expenditure of government facilities impact fees collected from qualifying new construction. The impact fees must be used for the acquisition of construction of government facilities. During fiscal year 2010 the Government Facilities Impact Fee Fund spent $1,853,437 on the Property Appraiser's new Radio Road location, $341,448 on the Courthouse Annex, $239,731 on the Emergency Services Complex and $256,058 on other government facilities. The Community Redevelopment Fund accounts for the receipt and expenditure of tax increment revenues for the Bayshore /Gateway Triangle and Immokalee Redevelopment Authorities. During fiscal year 2010 the Bayshore /Gateway Triangle prepaid $1,114,000 on a taxable note due to mature on September 1, 2014. The prepayment was the result of not closing on a parcel of real estate targeted for redevelopment within the Triangle. Proprietary funds Proprietary fund statements provide the same information as the business -type activities in the government -wide financial statements, but in greater detail, and on a fund basis for enterprise funds. At September 30, 2010, total net assets amounted to $843,010,747 for enterprise funds, as compared to $833,968,648 as of September 30, 2009. Net assets change as a result of operations, non - operating revenues and expenses, capital contributions and grants and donations. The Collier County Water and Sewer District's activity represents the vast majority of the increase in net assets. For the year ended September 30, 2010 the Water and Sewer District reported capital grants and contributions of $9,225,164, which includes system development fees of $7,259,306, $1,664,505 in developer infrastructure contributions capital grants from other governmental agencies of $288,000 and other contributions of $13,353. Net Operating Income/( g5 2010 2009 County Water and Sewer $ 16,396,126 $ 23,137,977 Solid Waste Disposal 6,264,619 2,099,676 Non -major enterprise funds (21,584,975) (22,721,725) Total $ 1,075,770 $ 2,515,928 The Collier County Water and Sewer Fund net operating income decreased by $6,741,851. The decrease in net operating income was the result of a decrease in operating revenues of $3,879,757, or 3.7 %, compared to the previous fiscal year, while costs of operations, including depreciation and amortization, were up 3.5% overall. The primary reason for this increase was the addition of $105M in capital assets during the last fiscal year and the related depreciation on those capital assets. County Water and Sewer payments in lieu of taxes paid to the General Fund of $3,459,500 were reclassified from operating expense to operating transfers for financial statement purposes. Personal services expense increased by 2.4 %, when compared to fiscal year 2009, as overtime increased due to an increased occurrence of line breaks and emergencies. Workers compensation expenses increased when compared to 2009 due to rebates applied to 2009. Other operating expenses were held constant over the last two fiscal years. Capital Assets Collier County's financial statements present capital assets in two distinct groups, those that are depreciated and those not subject to depreciation. Buildings and equipment are examples of assets that are depreciated and land and construction in progress are examples of assets not depreciated. Collier County's investment in capital assets for the governmental and business -type activities amounted to $2,542,861,280, net of accumulated depreciation. This investment in capital assets, both purchased and donated, includes land, buildings and improvements, water and wastewater plants, machinery and equipment, parks, roads, beach renourishment and drainage structures. Investment in capital assets for the current fiscal year, net of depreciation, decreased by $15,967,092 when compared to the previous year. There was an increase in the governmental activities of $6,580,153, or .4 %. The proprietary fund capital assets decreased by $22,547,245, or 2.5% as amounts depreciated and impaired exceeded amounts capitalized. The major factors behind these changes are as follows: The County Water and Sewer District experienced an impairment of the South County Wellfield in the amount of $9,247,207. The County Water and Sewer District also capitalized $13,226,952 of work in process related to water and wastewater facilities and improvements. - Capitalization of construction in progress of $52,466,062 for governmental activity related costs, with $36,044,463 of this amount related to transportation projects, $6,962,562 related to water 10 management and the remaining $9,459,037 to parks and recreation, governmental facilities and other projects. Purchases of land and non - depreciable assets were $7,858,168 for fiscal year 2010. Additional information regarding Collier County's capital assets can be found in Note 5 beginning on page 50 of this report. Debt Administration At September 30, 2010, Collier County had bonded revenue debt, net of amortizations, of $584,371,983 outstanding, an increase of $38,275,035 from the previous year. The following table illustrates the balances of all outstanding long -term debt for the fiscal years ended September 30, 2010 and 2009: Outstanding Debt 2010 2009 Limited General Obligation Bonds, net $ 29,854,422 $ 37,700,223 Revenue Bonds, net Florida Local Government Loans State Revolving Fund Loans Miscellaneous Notes Total 584,371,983 114,640,946 546,096,948 66,047,000 116,906,373 11, 557, 675 13, 571, 675 $740,425,026 $ 780,322,219 During fiscal year 2010 Collier County prepaid a total of $7,268,000 in debt. Of this amount, $6,154,000 was related to the Florida Local Government pooled commercial paper program and $1,114,000 was related to the Bayshore /Gateway Triangle Redevelopment Agency. On October 8, 2009 the Collier County Water and Sewer District issued the $11,727,489 Collier County Water -Sewer District Water and Sewer Refunding Revenue Bond, Series 2009 for purposes of refunding all of the outstanding Collier County Water and Sewer District's Series 1999B bonds. On July 23, 2010 Collier County issued the $59,895,000 Series 2010 Special Obligation Bonds. The bonds were issued for the purpose of refunding all outstanding commercial paper in the Florida Local Government Pooled Program. The commercial paper was variable rate and set to mature on December 4, 2012. On November 30, 2010 Collier County issued the Series 2010B Special Obligation Refunding Revenue Bonds in the par amount of $24,620,000. These bonds were issued for the purpose of advance refunding all of the County's outstanding Capital Improvement Revenue Bonds, Series 2002. The refinancing of the Series 2002 Bonds, and their attendant restrictive covenants, caused the required cash reserve surety replacement relating to the Series 2002, 2003 and 2005 bonds to decrease from $19,570,777 to $15,717,300, or $3,853,477. The Constitution of the State of Florida, Florida Statute 200.181 and Collier County set no legal debt limit. Further information regarding Collier County's long -term debt can be found in Note 6 beginning on page 51 of this report. 11 Budgetary Highlights Budgetary comparison statements are provided in the basic financial statements for the General Fund and the Community Redevelopment Fund (CRA). Budget columns are presented for both the original budget and the final budget. These columns are followed by a column for actual revenues and expenditures and a column for differences between final budget and actual revenues and expenditures. Significant period revenue and expenditure budget increases and decreases, over $250,000 within a department, were made and are outlined in the following table: BCC Department/ Budget Agency Increase /(Decrease) Reason forincrease /(Decrease) Intersection Safety $ 990,850 Increase in expenditures for new red light enforcement program. Tax Collector's Agency (448,999) Decrease in operating expenditures to actual. Natural Resources 998,222 Rebudget of lapsed appropriations. Other General Admin. 569,400 Rebudget of lapsed appropriations. Library (503,971) Decrease in capital expenditures. Parks and Recreation (834,900) Decrease expenditure budget to revised revenue forecasts. Sheriff's Agency (1,234,500) Decrease in personal services. Sheriff's Agency (412,821) Decrease in operating expenditures. BCCTransfers In 15,000,000 Increase transfersfrom Self Insurance forpotential shortterm loan. Intersection Safety 841,000 Increase in fines from new red light enforcement program. CRA 317,341 Increase Immokalee Redevelopment expenditures forstorm water. CRA 250,000 increase Immokalee Redevelopment land purchases. CRA Transfers Out 317,341 Increase transfer in from otherfunds for storm water master plan. Sheriff's Agency 1,614,100 Increase in charges forservices- special detail duties. Tax Collector's Agency 834,523 Increase in charges for services to actual. Significant variances between actual results and final budget amounts in the General Fund occurred during fiscal year 2010. Tax revenues were under budget by $10,853,721 primarily due to the early payment discount allowed for property taxes. The discount ranges from a maximum 4% to 1%, depending on the date of payment. General Fund general government expenditures were under budget primarily due to $1,485,764 in unspent budget related to natural resource planning and $1,309,730 of unspent budget in the other general administrative category. The other general administrative category was under budget mainly due to decreased operating expenditures such as property insurance. The Clerk of the Circuit Court's personal services and operating expenditures were under budget by a combined $1,157,137, primarily due to staff vacancies, unpaid furloughs and decreased legal fees. Sheriffs public safety expenditures were a combined $2,780,527 less than anticipated for fiscal year 2010. Human services related expenditures were a combined $1,336,862 under budget due mainly to unspent client assistance budget of $911,884. Economic Factors and Year 2011 Budgets and Rates The following factors were taken into account in preparing the fiscal year 2011 budget: - An 11.6% average reduction in countywide taxable property values. - Forecast ad valorem collections at 95.3% of budget. - Expected increases in sales tax and state shared revenues of 2.2% and 6.0%, respectively. - No new or expanded programs and initiatives; all existing programs to be fund_ ed at 95% of the prior year's level. 12 Continuation of Board Agency hiring freeze within ad valorem funded operations and exception replacement hiring within enterprise operations. Maintain health care program contributions at 80% employer and 20% employee across all agencies (Non- Sheriff). During fiscal year 2010, the General Fund unreserved fund balance increased by $20,781,489 to $59,705,240. As of January 28, 2011, $46,539,399 of the fiscal year 2010 unreserved fund balance has been appropriated as carryforward for fiscal year 2011. Contact Information This financial report is intended to give the user a general overview of Collier County Government's finances. Any questions resulting from review of this information may be addressed to: Collier County Clerk of the Circuit Court Department of Finance and Accounting 3299 Tamiami Trail East, Suite #403 Naples, Florida 34112 -5746 Our office may also be contacted via the internet at www.colliercierk.com. 13 COLLIER COUNTY, FLORIDA STATEMENT OF NET ASSETS SEPTEMBER 30, 2010 ASSETS Current assets: Cash, cash equivalents and investments Trade receivables, net Special assessments receivable Interest receivable Unbilled receivables Notes receivable Due from other governments Internal balances Deposits Inventory Prepaid costs Restricted assets: Cash, cash equivalents and investments Trade receivables, net Interest receivable Due from other governments Total current assets Noncurrent assets: Restricted assets: Cash, cash equivalents and investments Notes receivable Special assessments receivable Notes receivable Deferred charges Capital assets: Land and nondepreciable capital assets Depreciable capital assets, net Total noncurrent assets Total assets Primary Government Governmental Business -type Component Activities Activities Total Units $ 229,638,115 $ 134,593,992 $ 364,232,107 $ 459,432 1,524,668 10,069,354 11,594,022 - 94,259 580,258 674,517 - 287,806 354,419 642,225 - - 5,312,233 5,312,233 - 38,573 - 38,573 - 10,335,437 1,576,092 11,911,529 - (26,040,421) 26,040,421 - - 518,267 9,079 527,346 - 18,699,743 3,573,538 22,273,281 - 48,037 - 48,037 - 14,491,328 3,838,004 18,329,332 - 2,502,311 - 2,502,311 - 303,510 - 303,510 - 4,584,450 - 4,584,450 - 257,026,083 185,947,390 442,973,473 459,432 238,135,379 37,982,409 276,117,788 - 9,477,307 - 9,477,307 - 139,557 61,914 201,471 - 3,232,444 1,066,047 4,298,491 - 5,409,712 1,358,479 6,768,191 - 451,008,495 90,560,733 541,569,228 - 1,200,223,248 801,068,804 2,001,292,052 1,907,626,142 932,098,386 2,839,724,528 - 2,164,652,225 1,118,045,776 3,282,698,001 459,432 The notes to the financial statements are an integral part of this statement. 14 15 Primary Government Governmental Business -type Component Activities Activities Total Units LIABILITIES Current liabilities: Accounts payable $ 16,917,880 $ 8,095,800 $ 25,013,680 $ - Wages payable 6,445,768 2,019,227 8,464,995 - Retainage payable 480,776 109,901 590,677 - Due to other governments 1,847,342 67,841 1,915,183 - Due to individuals 212,863 385,712 598,575 - Self- insurance claims payable 5,547,417 - 5,547,417 - Compensated absences 10,652,217 1,858,961 12,511,178 - Capital lease obligations 170,037 249,535 419,572 - Unearned revenue 3,986,381 - 3,986,381 - Interest payable 8,351,806 2,615,394 10,967,200 - Bonds and loans payable 29,403,527 9,352,464 38,755,991 - Liabilities payable from restricted assets: Accounts payable 7,902,808 264,949 8,167,757 - Wages payable 235,665 - 235,665 - Retainage payable 7,266,415 498,735 7,765,150 - Refundable deposits 1,947,378 233,154 2,180,532 - Notes payable - 71,675 71,675 - Unearned revenue - 260,644 260,644 - Bonds and loans payable 2,500,866 2,500,866 Total current liabilities 101,368,280 28,584,858 129,953,138 - Noncurrent liabilities: Self- insurance claims payable 3,061,583 - 3,061,583 - Compensated absences 11,268,363 796,698 12,065,061 - Capital lease obligations 269,059 386,811 655,870 - Landfill post - closure liability - 1,900,531 1,900,531 - Net OPEB obligation 1,420,091 - 1,420,091 - Bonds and loans payable, net 455,730,363 243,366,131 699,096,494 - Total noncurrent liabilities 471,749,459 246,450,171 718,199,630 - Total liabilities 573,117,739 275,035,029 848,152,768 NET ASSETS Invested in capital assets, net of related debt 1,169,052,341 635,702,055 1,804,754,396 - Restricted for: Growth related capital expansion 101,362,445 23,849,801 125,212,246 - Transportation capital projects 65,303,300 - 65,303,300 - Conservation Collier 23,168,991 - 23,168,991 - Tourist development 38,169,429 - 38,169,429 - Debt service 4,567,076 13,644,754 18,211,830 - Renewal and replacement - 300,000 300,000 - Unrestricted 189,910,904 169,514,137 359,425,041 459,432 Total net assets $1,591,534,486 $ 843,010,747 $ 2,434,545,233 $ 459,432 15 COLLIER COUNTY, FLORIDA STATEMENT OF ACTIVITIES FOR THE FISCAL YEAR ENDED SEPTEMBER 30, 2010 Program Revenues Total governmental activities 463,645,053 Fees, Fines and Operating Capital Business -type Activities: Charges for Grants and Grants and FUNCTIONS /PROGRAMS Expenses Services Contributions Contributions Primary Government: 27,415,599 33,568,288 14,493 33,168 Governmental Activities: 4,382,071 2,518,720 - 80,500 General government $ 100,482,993 $ 29,281,277 $ 1,911,027 $ 4,232,662 Public safety 179,276,496 16,384,980 2,284,052 1,084,632 Physical environment 16,807,929 867,048. 10,648,220 2,842,447 Transportation 76,603,220 828,935 5,074,101 13,453,185 Economic environment 11,141,270 184,512 9,063,173 - Human services 12,987,422 504,885 2,865,519 - Culture and recreation 46,870,497 8,267,287 38,003 4,149,104 Interest and fiscal charges 19,475,226 - - - Total governmental activities 463,645,053 56,318,924 31,884,095 25,762,030 Business -type Activities: Water and Sewer 103,271,857 101,062,479 11,185 9,225,164 Solid Waste 27,415,599 33,568,288 14,493 33,168 Airport Authority 4,382,071 2,518,720 - 80,500 Mass Transit 9,617,411 1,145,338 4,246,994 700,390 Emergency Medical Services 28,767,067 16,452,497 175,514 345,795 Total business -type activities 173,454,005 154,747,322 4,448,186 10,385,017 Total primary government $ 637,099,058 $ 211,066,246 $ 36,332,281 $ 36,147,047 Component Units: Industrial Development Authority $ 194 $ 3,948 $ - $ - Health Facilities Authority - - - - Housing Finance Authority 30,662 - - - Educational Facilities Authority 178 - - - Total component units $ 31,034 $ 3,948 $ - $ - General revenues: Property taxes Gas taxes Sales taxes Tourist taxes Communications services tax State revenue sharing Othertaxes Interest income Miscellaneous Transfers, net Total general revenues and transfers Change in net assets Net assets - beginning Net assets - ending The notes to the financial statements are an integral part of this statement. 16 Net (Expense) Revenue and Changes in Net Assets Primary Government Governmental Business -type Component Activities Activities Total Units $ (65,058,027) $ - $ (65,058,027) (159,522,832) - (159,522,832) (2,450,214) - (2,450,214) (57,246,999) - (57,246,999) (1,893,585) - (1,893,585) - (9,617,018) - (9,617,018) (34,416,103) - (34,416,103) - (19,475,226) - (19,475,226) - (349,680,004) - (349,680,004) - - 7,026,971 7,026,971 - - 6,200,350 6,200,350 - (1,782,851) (1,782,851) - - (3,524,689) (3,524,689) - (11,793,261) (11,793,261) - (3,873,480) (3,873,480) (349,680,004) (3,873,480) (353,553,484) - $ 3,754 (30,662) (178) (27,086) 299,388,943 - 299,388,943 - 18,415,124 - 18,415,124 - 26,926,904 - 26,926,904 - 12,856,489 - 12,856,489 - 5,545,415 - 5,545,415 - 7,854,315 - 7,854,315 - 4,493,384 - 4,493,384 - 4,664,915 1,569,011 6,233,926 371 8,022,325 87,401 8,109,726 - (11,259,167) 11,259,167 - - 376,908,647 12,915,579 389,824,226 371 27,228,643 9,042,099 36,270,742 (26,715) 1,564,305,843 833,968,648 2,398,274,491 486,147 $ 1,591,534,486 $ 843,010,747 $ 2,434,545,233 $ 459,432 17 ASSETS Cash, cash equivalents and investments Receivables: Interest Trade, net Notes Special assessments Due from other funds Due from other, governments Inventory Advances to other funds Prepaid costs Totalassets LIABILITIES AND FUND BALANCES Liabilities: Accounts payable Wages payable Due to other funds Due to other governments Due to individuals Deferred revenue Refundable deposits Retainage payable Advances from other funds Total liabilities COLLIER COUNTY, FLORIDA BALANCE SHEET GOVERNMENTAL FUNDS SEPTEMBER 30, 2010 Government Other Total General Facilities Community Governmental Governmental Fund Impact Fee Redevelopment Funds Funds $70,259,476 $ 7,469,874 $ 3,872,596 $359,294,450 $440,896,396 72,095 11,230 6,530 456,747 546,602 422,772 445 - 3,460,034 3,883,251 1,729,764 300,811 10,717,749 12,748,324 - - - 233,816 233,816 4,159,299 - - 1,120,215 5,279,514 2,127,458 8,555 - 12,782,823 14,918,836 117,186 - 13,662,212 4,352,277 18,131,675 9,317,325 - - 36,067,600 45,384,925 24,995 - 1,947,378 24,995 $88,230,370 $ 7,790,915 $ 17,541,338 $428,485,711 $542,048,334 $ 7,319,991 $ 86,541 $ 346,192 $ 15,846,074 $ 23,598,798 4,239,938 - 36,040 2,108,694 6,384,672 1,782,384 - - 4,185,280 5,967,664 1,156,275 - 2,613 688,454 1,847,342 208,243 - - 4,620 212,863 309,892 300,811 - 14,570,702 15,181,405 1,867,036 - - 80,342 1,947,378 - 72,666 - 7,674,525 7,747,191 - 19,828,091 - 49,116,503 68,944,594 16,883,759 20,288,109 384,845 94,275,194 131,831,907 Fund balances (deficit): Reserved for: Encumbrances 2,181,865 1,364,616 566,845 70,511,674 74,625,000 Inventory 117,186 - 13,662,212 4,083,386 17,862,784 Advances to other funds 9,317,325 - - 36,067,600 45,384,925 Prepaid costs 24,995 - - - 24,995 Debt service - - - 4,567,076 4,567,076 Unreserved, reported in: General fund 59,705,240 - - - 59,705,240 Special revenue funds - - 2,927,436 123,708,909 126,636,345 Debt service funds - - - 2,026,416 2,026,416 Capital project funds - (13,861,810) - 93,245,456 79,383,646 Total fund balances (deficit) 71,346,611 (12,497,194) 17,156,493 334,210,517 410,216,427 Total liabilities and fund balances (deficit) $88,230,370 $ 7,790,915 $ 17,541,338 $428,485,711 $542,048,334 The notes to the financial statements are an integral part of this statement. 18 COLLIER COUNTY, FLORIDA RECONCILIATION OF THE BALANCE SHEET OF GOVERNMENTAL FUNDS TO THE STATEMENT OF NET ASSETS FOR THE FISCAL YEAR ENDED SEPTEMBER 30, 2010 Differences in amounts reported for governmental activities in the statement of net assets on pages 14 -15: Fund balances - total governmental funds Capital assets used in governmental activities are not financial resources and therefore are not reported in the funds. Those assets consist of: Land and other non - depreciable assets Construction in progress Depreciable assets, net of $507,901,337 in accumulated depreciation. Certain long -term assets are not financial resources and therefore are not reported in the governmental funds. Certain revenues will be collected after year -end, but are not available to pay for the current period's expenditures, and therefore are reported as deferred revenue in the funds. Certain liabilities applicable to the County's governmental activities are not due and payable in the current period and accordingly are not reported as fund liabilities. Interest on long -term debt is not accrued in the governmental funds, but is recognized as an expenditure when due. All liabilities are reported in the statement of net assets. Balances at September 30, 2010 are: Accrued interest on bonds Bonds and notes payable Capital lease obligations Compensated absences Unamortized deferred loss Unamortized premium Unamortized discount Internal service funds are used by the County to charge self- insurance, fleet management and information technology services to individual funds. The assets and liabilities of the Internal service funds are included in governmental activities in the statement of net assets. Internal service fund net assets are: Total net assets - governmental activities The notes to the financial statements are an integral part of this statement. 19 $ 410,216,427 $ 378,046,623 72,920,895 1,177,301,982 1,628,269,500 5,409,712 11,195,024 $ (8,351,806) (470,136,399) (439,096) (21,398,346) 188,439 (15,691,991) 506,061 (515,323,138) 51,766,961 $ 1,591,534,486 COLLIER COUNTY, FLORIDA STATEMENT OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCES GOVERNMENTAL FUNDS FOR THE FISCAL YEAR ENDED SEPTEMBER 30, 2010 Expenditures: Government Other Total General Facilities Community Governmental Governmental Public safety Fund Impact Fee Redevelopment Funds Funds Revenues: 9,974,186 Transportation - - - 43,677,170 43,677,170 Taxes $239,089,279 $ - $ 2,453,600 $ 92,011,415 $333,554,294 Licenses, permits and impact fees 350,784 909,400 - 27,660,140 28,920,324 Intergovernmental 35,986,176 - - 50,459,137 86,445,313 Charges for services 18,040,462 Interest 6,070 9,075,397 27,121,929 Fines and forfeitures 2,568,833 - - 3,160,856 5,729,689 Interest income 961,365 80,248 47,241 3,216,722 4,305,576 Special assessments - - - 2,847,764 2,847,764 Miscellaneous 1,872,621 - 383,352 4,124,232 6,380,205 Total revenues 298,869,520 989,648 2,890,263 192,555,663 495,305,094 Expenditures: Current: General government 57,364,440 419,556 - 24,624,438 82,408,434 Public safety 142,488,627 278,246 - 22,250,491 165,017,364 Physical environment 738,866 - - , 9,235,320 9,974,186 Transportation - - - 43,677,170 43,677,170 Economic environment 844,538 - 2,691,564 7,585,760 11,121,862 Human services 9,144,886 - - 2,971,050 12,115,936 Culture and recreation 16,160,019 - - 21,409,255 37,569,274 Debt service: Principal - - 1,114,000 33,160,202 34,274,202 Interest - - - 20,339,711 20,339,711 Fiscal charges - - - 890,591 890,591 Capital outlay 5,536,564 1,992,872 232,518 62,047,002 69,808,956 Total expenditures 232,277,940 2,690,674 4,038,082 248,190,990 487,197,686 Excess (deficiency) of revenues over (under) expenditures 66,591,580 (1,701,026) (1,147,819 (55,635,327) 8,107,408 Other financing sources (uses): Bonds issued - - - 59,895,000 59,895,000 Premiums on bonds issued - - - 844,241 844,241 Payment to refund commercial paper - - - (59,893,000) (59,893,000) Sale of capital assets 175,661 - - 72,392 248,053 Insurance proceeds 64,639 - - 245,587 310,226 Transfers in 9,189,343 - 383,961 95,819,970 105,393,274 Transfers out (52,560,747) (5,440,659) (1,632,944) (55,270,601) (114,904,951) Total other financing sources (uses) (43,131,104) (5,440,659) (1,248,983) 41,713,589 (8,107,157 Net change in fund balances 23,460,476 (7,141,685) (2,396,802) (13,921,738) 251 Fund balances (deficit) at beginning of year 47,886,135 (5,355,509) 19,553,295 348,132,255 410,216,176 Fund balances (deficit) at end of year $ 71,346,611 $ (12,497,194) $ 17,156,493 $ 334,210,517 $410,216,427 The notes to the financial statements are an integral part of this statement. 20 COLLIER COUNTY, FLORIDA RECONCILIATION OF THE STATEMENT OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCES OF GOVERNMENTAL FUNDS TO THE STATEMENT OF ACTIVITIES FOR THE FISCAL YEAR ENDED SEPTEMBER 30, 2010 Differences in amounts reported for governmental activities in the statement of activities on pages 16 -17: Net change in fund balances - total governmental funds $ 251 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. Capital outlay $ 69,808,956 Depreciation expense (69,716,099) 92,857 Donations of capital assets are not financial resources to governmental funds, but receiving donated assets increases net assets in the statement of net assets. 3,396,515 Capital assets transferred to and from proprietary funds are not recorded in the governmental funds as there is no flow of current financial resources. (11,023,404) In the statement of activities, the loss on the sale of capital assets is reported. However, in the governmental funds the proceeds from the sale of capital assets increase financial resources. The change in net assets differs from the change in fund balance by the net book value of assets disposed. (963,235) Expenses related to the reduction of developer capital contributions receivable are not reported as expenditures in the governmental funds. (2,550,000) Certain revenues not considered available are not recognized in the governmental funds but are included in the statement of activities. Deferred revenue $ (1,058,262) Developer contributions (2,550,000) (3,608,262) Debt proceeds provide current financial resources to governmental funds, but issuing debt increases long -term liabilities in the statement of net assets. (60,739,241) Repayment of principal on long -term debt is an expenditure in governmental funds, but a reduction of long -term liabilities in the statement of net assets. Bond and loan principal payments $ 34,114,428 Payments to refund commercial paper 59,893,000 Payments on capital lease obligations 159,774 94,167,202 Certain amounts reported in the statement of activities do not require the use of current financial resources and therefore are not reported as expenditures in the governmental funds. Decrease in compensated absences $ 165,503 Accrued interest on bonds (83,303) Amortization of deferred charges, net (324,062) Amortization of deferred loss (94,220) Amortization of premium 1,134,205 Amortization of discount (28,338) Decrease in arbitrage rebate liability 315,185 1,084,970 Certain amounts reported in the statement of activities as deferred are reported as expenditures in the governmental funds. 835,609 The net revenues of internal service funds are reported with governmental activities. 6,535,381 Change in net assets - governmental activities $ 27,228,643 The notes to the financial statements are an integral part of this statement. 21 COLLIER COUNTY, FLORIDA GENERAL FUND STATEMENT OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCES BUDGET AND ACTUAL (NON -GAAP) FOR THE FISCAL YEAR ENDED SEPTEMBER 30, 2010 Expenditures: Variance with Current: Final Budget General government Original Final Favorable Board of County Commissioners personal services Budget Budget Actual (Unfavorable) Revenues: 47,800 47,800 44,404 3,396 Taxes $ 249,943,000 $ 249,943,000 $ 239,089,279 $ (10,853,721) Licenses, permits and impact fees 164,000 164,000 350,784 186,784 Intergovernmental 33,208,900 33,208,900 35,986,176 2,777,276 Charges for services 16,247,845 18,881,157 18,040,462 (840,695) Fines and forfeitures 458,200 1,299,200 2,568,833 1,269,633 Interest income 2,190,800 2,190,800 886,772 (1,304,028) Miscellaneous 6,859,700 7,113,715 7,802,221 688,506 Total revenues 309,072,445 312,800,772 304,724,527 (8,076,245) Expenditures: Current: General government Board of County Commissioners personal services 955,000 955,000 934,855 20,145 Board of County Commissioners operating 47,800 47,800 44,404 3,396 County manager administrative personal services 931,600 931,600 846,872 84,728 County manager administrative operating 29,300 29,300 16,140 13,160 Budget and management personal services 912,400 912,400 767,905 144,495 Budget and management operating 51,500 51,500 18,218 33,282 Administrative services personal services 1,759,800 1,759,800 1,607,630 152,170 Administrative services operating 105,000 112,488 100,451 12,037 Administrative services capital outlay 7,500 5,929 4,227 1,702 Human resources administration personal services 1,303,200 1,317,200 1,314,997 2,203 Human resources administration operating 351,000 337,000 151,688 185,312 Clerk of the Circuit Court personal services 4,972,050 5,454,750 4,814,113 640,637 Clerk of the Circuit Court operating 2,810,750 2,228,050 1,723,554 504,496 Clerk of the Circuit Court capital outlay 87,900 187,900 175,896 12,004 Property Appraiser personal services 5,128,771 4,954,985 4,847,899 107,086 Property Appraiser operating 1,470,850 1,622,832 1,720,790 (97,958) Property Appraiser capital outlay 50,000 71,804 71,804 - Tax Collector personal services 9,586,604 9,467,219 9,467,219 - Tax Collector operating 3,367,515 3,038,431 2,987,311 51,120 Tax Collector capital outlay 50,242 49,712 49,712 - County attorney personal services 2,522,000 2,522,000 2,421,881 100,119 County attorney operating 445,300 445,300 180,050 265,250 Natural resource planning personal services 229,200 229,355 228,710 645 Natural resource planning operating 1,485,600 2,387,011 901,892 1,485,119 Circuit court costs operating 42,500 42,500 17,736 24,764 Courthouse security operating 1,205,200 1,263,019 1,260,834 2,185 Courthouse security capital outlay 40,000 - 8,836 (8,836) County court cost operating 22,900 22,900 5,303 17,597 State Attorney operating 319,100 319,100 248,253 70,847 Public Defender operating 159,700 201,100 201,100 - Other general administrative personal services 460,100 460,100 331,855 128,245 Other general administrative operating 7,423,200 7,778,150 6,596,665 1,181,485 Facilities management personal services 3,295,500 3,516,343 3,516,343 - Facilities management operating 7,738,900 7,718,541 7,639,208 79,333 Facilities management capital outlay 217,000 149,018 165,084 (16,066) 22 COLLIER COUNTY, FLORIDA GENERAL FUND STATEMENT OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCES BUDGET AND ACTUAL (NON -GAAP) FOR THE FISCAL YEAR ENDED SEPTEMBER 30, 2010 Sheriff personal services Sheriff operating Supervisor of Elections personal services Supervisor of Elections operating Supervisor of Elections capital outlay Real property management personal services Real property management operating Total general government Public safety Sheriff personal services Sheriff operating Sheriff capital outlay Emergency management administration personal service Emergency management administration operating Helicopter operations personal services Helicopter operations operating Intersection safety personal services Intersection safety operating Medical examiner services operating Medical examiner services capital outlay Total public safety Physical environment Conservation and resource management personal service Conservation and resource management operating Immokalee cemetery operating Total physical environment Economic environment Veterans services personal services Veterans services operating Impact fee assistance operating Housing and urban improvement operating Total economic environment Human services Health Care Responsibility Act operating Domestic animal services personal services Domestic animal services operating Domestic animal services capital outlay Health department operating Mental health operating Client assistance personal services Client assistance operating Public services division office personal services Public services division office operating Total human services Variance with Final Budget Original Final Favorable Budget Budget Actual (Unfavorable) 3,744,300 3,412,100 3,529,650 (117,550) 126,200 126,200 132,535 (6,335) 1,978,100 1,978,100 1,846,784 131,316 1,298,400 1,283,613 1,227,044 56,569 14,900 24,270 20,480 3,790 813,900 834,900 825,753 9,147 22,400 22,400 17,857 4,543 67,583,182 68,271,720 62,989,538 5,282,182 118,355,700 1 117,453,400 1 114,349,982 3 3,103,418 26,707,400 2 26,294,579 2 23,289,123 3 3,005,456 1,635,000 1 1,636,240 4 4,964,587 ( (3,328,347) 620,900 633,900 612,990 20,910 162,600 162,600 104,728 57,872 8,200 8,200 2,642 5,558 791,700 804,700 720,360 84,340 271,800 282,800 277,738 5,062 61,600 50,600 29,971 20,629 187,500 187,500 - 187,500 537,000 590,000 515,676 74,324 1,057,900 11110,900 823,385 287,515 50,000 50,000 - 50,000 1,949,800 1,949,800 1,886,123 63,677 741,700 741,700 495,279 246,421 53,500 - - - 1,720,100 1,795,100 1,748,233 46,867 899,300 899,300 899,300 - 446,700 446,700 432,667 14,033 4,040,300 4,040,300 3,142,449 897,851 318,700 318,700 302,956 15,744 11,100 11,100 8,831 2,269 10,231,200 10,252,700 8,915,838 1,336,862 23 271,800 282,800 277,738 5,062 61,600 50,600 29,971 20,629 187,500 187,500 - 187,500 537,000 590,000 515,676 74,324 1,057,900 11110,900 823,385 287,515 50,000 50,000 - 50,000 1,949,800 1,949,800 1,886,123 63,677 741,700 741,700 495,279 246,421 53,500 - - - 1,720,100 1,795,100 1,748,233 46,867 899,300 899,300 899,300 - 446,700 446,700 432,667 14,033 4,040,300 4,040,300 3,142,449 897,851 318,700 318,700 302,956 15,744 11,100 11,100 8,831 2,269 10,231,200 10,252,700 8,915,838 1,336,862 23 50,000 50,000 - 50,000 1,949,800 1,949,800 1,886,123 63,677 741,700 741,700 495,279 246,421 53,500 - - - 1,720,100 1,795,100 1,748,233 46,867 899,300 899,300 899,300 - 446,700 446,700 432,667 14,033 4,040,300 4,040,300 3,142,449 897,851 318,700 318,700 302,956 15,744 11,100 11,100 8,831 2,269 10,231,200 10,252,700 8,915,838 1,336,862 23 23 COLLIER COUNTY, FLORIDA GENERAL FUND STATEMENT OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCES BUDGET AND ACTUAL (NON -GAAP) FOR THE FISCAL YEAR ENDED SEPTEMBER 30, 2010 Variance with Final Budget Original Final Favorable Budget Budget Actual (Unfavorable) Culture and recreation 290,500 175,661 (114,839) - Library administration personal services 5,231,200 5,260,612 5,040,453 220,159 Library administration operating 1,726,300 1,726,300 1,553,870 172,430 Library administration capital outlay 510,400 6,662 6,543 119 Beach and water park operations personal services 5,026,400 4,881,700 4,640,592 241,108 Beach and water park operations operating 5,519,000 4,824,869 4,520,352 304,517 Beach and water park operations capital outlay 71,000 20,877 19,400 1,477 Total culture and recreation 18,084,300 16,721,020 15,781,210 939,810 Total expenditures Excess of revenues over expenditures Other financing sources (uses): Sale of capital assets Insurance proceeds Transfers in Transfers out Total other financing sources (uses) Net change in fund balance Fund balance at beginning of year Fund balance at end of year Reconciliation: Net change in fund balance, budgetary basis Bad debt expense Net change in fair value of investments Advances budgeted as transfers Net change in fund balance, GAAP basis 248,236,782 247,350,608 236,540,178 30,810430 60,835,663 65,450,164 68,184,349 2,734,185 290,500 290,500 175,661 (114,839) - 55,482 64,639 9,157 7,240,937 20,880,884 9,218,923 (11,661,961) (70,192,800) (69,692,855) (57,138,969) 12,553,886 (62,661,363) (48,465,989) (47,679,746) 786,243 (1,825,700) 16,984,175 20,504,603 3,520,428 33,217,700 34,902,337 34,902,337 $ 31,392,000 $ 51,886,512 $ 55,406,940 $ 3,520,428 The notes to the financial statements are an integral part of this statement. 24 $ 20,504,603 (6,220) 74,593 2,887,500 $ 23,460,476 COLLIER COUNTY, FLORIDA COMMUNITY REDEVELOPMENT STATEMENT OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCES BUDGET AND ACTUAL (NON -GAAP) FOR THE FISCAL YEAR ENDED SEPTEMBER 30, 2010 Revenues: Taxes Charges for services Interest income Miscellaneous Total revenues Expenditures: Current: Economic environment Bayshore /Gateway personal services Bayshore /Gateway operating Bayshore /Gateway capital outlay Immokalee redevelopment personal services Immokalee redevelopment operating Immokalee redevelopment capital outlay Debt service: Bayshore /Gateway principal Total expenditures Excess (deficiency) of revenues over (under) expenditures Other financing sources (uses): Transfers in Transfers out Total other financing uses Net change in fund balance Fund balance at beginning of year Fund balance at end of year Reconciliation: Excess of revenues over expenditures, budgetary basis Net change in fair value of investments Net change in fund balance, GAAP basis Variance with Final Budget Original Final Favorable Budget Budget Actual (Unfavorable) $ 2,453,600 $ 2,453,600 $ 2,453,600 $ - - - 6,070 6,070 55,000 55,000 40,980 (14,020) 79,000 383,352 304,352 2,508,600 21587,600 2,884,002 296,402 397,600 509,420 404,692 104,728 1,086,000 1,228,632 866,436 362,196 2,100,000 986,000 - 986,000 264,600 354,600 260,147 94,453 894,000 1,411,341 1,160,289 251,052 200,000 450,000 232,518 217,482 1,114,000 11114,000 4,942,200 61053,993 4,0381082 2,015,911 (2,433,600) (3,466,393) (1,154,080) 2,312,313 33,800 383,961 383,961 - (1,787,300) (1,987,300) (1,632,944) 354,356 (1,753,500) (1,603,339) (1,248,983) 354,356 (4,187,100) (5,069,732) (2,403,063) 2,666,669 6,144,000 6,286,632 6,286,632 $ 1,956,900 $ 1,216,900 $ 3,883,569 $ 2,666,669 The notes to the financial statements are an integral part of this statement. 25 $ (2,403,063) 6,261 $ (2196,802) COLLIER COUNTY, FLORIDA STATEMENT OF NET ASSETS PROPRIETARY FUNDS SEPTEMBER 30, 2010 Noncurrent assets: Restricted assets: Cash, cash equivalents and investments 37,982,409 Business -type Activities Enterprise Funds - Governmental - County Activities - Water Solid Waste Other - Internal Service - and Sewer Disposal Funds Total Funds ASSETS Notes 1,066,047 - - 1,066,047 Current assets: Deferred charges 1,358,479 - - 1,358,479 Cash, cash equivalents and investments $ 110,157,924 $ 19,141,059 $ 5,295,009 $ 134,593,992 $ 41,368,426 Receivables: Land and nondepreciable capital assets 77,000,360 3,259,295 10,301,078 90,560,733 Trade, net 5,868,482 613,783 3,587,089 10,069,354 143,728 Special assessments 580,258 - - 580,258 - Interest 227,082 117,059 10,278 354,419 44,714 Unbilled revenue 4,739,744 - 572,489 5,312,233 - Due from other funds 30,711 44,868 - 75,579 869,997 Due from other governments 44,025 29,748 1,502,319 1,576,092 1,051 Deposits 9,079 - - 9,079 518,267 Inventory 3,429,373 - 144,165 3,573,538 568,068 Prepaid costs - - - - 23,042 Restricted assets: Cash, cash equivalents and investments 3,327,694 255,205 255,105 3,838,004 - Total current assets 128,414,372 20,201,722 11,366,454 159,982,548 43,537,293 Noncurrent assets: Restricted assets: Cash, cash equivalents and investments 37,982,409 - - 37,982,409 - Receivables: Special assessments 61,914 - - 61,914 - Advances 18,550,000 5,009,669 - 23,559,669 - Notes 1,066,047 - - 1,066,047 - Deferred charges 1,358,479 - - 1,358,479 - Capital assets: Land and nondepreciable capital assets 77,000,360 3,259,295 10,301,078 90,560,733 40,977 Depreciable capital assets, net 762,382,058 15,552,075 23,134,671 801,068,804 22,921,266 Total noncurrent assets 898,401,267 23,821,039 33,435,749 955,658,055 22,962243 Total assets 1, 026,815,639 44,022,761 44,802,203 11115,6404603 66,499,536 (Continued) 26 LIABILITIES Current liabilities: Accounts payable Wages payable Retainage payable Due to other funds Due to other governments Due to individuals Self- insurance claims payable Compensated absences Capital lease obligations Interest payable Bonds and loans payable Liabilities payable from restricted assets: Accounts payable Retainage payable Refundable deposits Unearned revenue Notes payable Bonds and loans payable Total current liabilities Noncurrent liabilities: Self- insurance claims payable Compensated absences Capital lease obligations Net OPEB obligation Landfill post - closure liability Bonds and loans payable, net Total noncurrent liabilities Total liabilities COLLIER COUNTY, FLORIDA STATEMENT OF NET ASSETS PROPRIETARY FUNDS SEPTEMBER 30, 2010 Business -type Activities Enterprise Funds Governmental Activities - County Water Solid Waste Other Internal Service and Sewer Disposal Funds Total Funds $ 5,056,130 $ 1,712,481 $ 1,327,189 $ 8,095,800 $ 1,221,890 1,051,535 76,841 890,851 2,019,227 296,761 109,901 - - 109,901 - 277 26,257 226,137 252,671 4,755 23 409 67,409 67,841 - 7,944 - 377,768 385,712 - - - - - 5,547,417 1,166,114 96,939 595,908 1,858,961 365,563 - - 249,535 249,535 - 2,615,394 - - 2,615,394 - 9,352,464 - - 9,352,464 - 264,949 - - 264,949 - 444,221 - 54,514 498,735 - 38,002 176,849 18,303 233,154 - - 78,356 182,288 260,644 - 71,675 - - 71,675 - 2,500,866 - 21500,866 - 22,679,495 2,168,132 3,989,902 28,837,529 7,436,386 - - - - 3,061,583 499,763 41,546 255,389 796,698 156,671 - - 386,811 386,811 - - - - - 1,420,091 - 1,900,531 - 1,900,531 - 243,366,131 - - - 243,366,131 - 243,865,894 1,942,077 642,200 246,450,171 4,638,345 266,545,389 4,110,209 4,632,102 275,287,700 12,074,731 NET ASSETS Invested in capital assets, net of related debt 584,091,282 18,811,370 32,799,403 635,702,055 22,962,243 Restricted for growth related capital expansion 23,849,801 - - 23,849,801 - Restricted for renewal and replacement 300,000 - - 300,000 - Restricted for debt service 13,644,754 - - 13,644,754 - Unrestricted 138,384,413 21,101,182 7,370,698 166,856,293 31,462,562 Total net assets $ 760,270,250 $ 39,912,552 $ 40,170,101 840,352,903 $ 54,424,805 Cumulative consolidation adjustment for internal service fund activities related to enterprise funds Net assets of Business -type Activities The notes to the financial statements are an integral part of this statement. 27 2,657,844 $ 843,010,747 COLLIER COUNTY, FLORIDA STATEMENT OF REVENUES, EXPENSES AND CHANGES IN FUND NET ASSETS PROPRIETARY FUNDS FOR THE FISCAL YEAR ENDED SEPTEMBER 30, 2010 Non - operating revenues (expenses): 9,225,164 33,176 Business -type Activities Enterprise Funds 10,433,963 Governmental Operating grants and contributions County 14,493 4,422,508 4,448,186 - Activities - 1,305,382 Water Solid Waste Other Insurance reimbursement Internal Service 2,296 and Sewer Disposal Funds Total Funds Operating revenues: 993,889 - Interest expense (9,326,347) - (28,875) Charges for services $ 99,880,767 $ 33,368,652 $ 20,439,329 $ 153,688,748 $ 67,137,322 Miscellaneous 778,708 199,636 80,230 1,058,574 19,428 Total operating revenues 100,659,475 33,568,288 20,519,559 154,747,322 67,156,750 Operating expenses: Personal services 23,116,018 1,678,517 19,806,344 44,600,879 6,802,284 Operating 27,777,417 24,925,295 19,530,690 72,233,402 64,628,761 Depreciation and amortization 33,369,914 699,857 2,767,500 36,837,271 2,071,722 Total operating expenses 84,263,349 27,303,669 42,104,534 153,671,552 73,502,767 Operating income (loss) 16,396,126 61264;619 (21,584,975) 1,075,770 (6,346,017) Non - operating revenues (expenses): 9,225,164 33,176 1,175,623 10,433,963 11,067,069 Operating grants and contributions 11,185 14,493 4,422,508 4,448,186 - Interest income 1,305,382 194,565 69,064 1,569,011 359,339 Insurance reimbursement 39,460 2,296 45,645 87,401 1,362,872 Rebatable arbitrage 993,889 - - 993,889 - Interest expense (9,326,347) - (28,875) (9,355,222) - Gain (loss) on disposal of capital assets 21,445 (1,673) (402,279) (382,507) (744) Loss on impairment of capital assets (9,247,207) - (9,247,207) Total non - operating revenues (expenses) (16,202,193) 209,681 41106,063 (11,886,449) 1,721,467 Income (loss) before contributions and transfers 193,933 6,474,300 (17,478,912) (10,810,679) (4,624,550) Capital grants and contributions 9,225,164 33,176 1,175,623 10,433,963 11,067,069 Transfers in 1,539,365 44,868 15,357,300 16,941,533 - Transfers out (3,712,984) (1,937,672) (79,200) (5,729,856) (1,700,000) Change in net assets 7,245,478 4,614,672 (1,025,189) 10,834,961 4,742,519 Net assets - beginning 753,024,772 35,297,880 4111951290_ 49,682,286 Net assets - ending $ 760,270,250 $ 39,912,552 $ 40,170,101 $ 54,424,805 Consolidation adjustment for internal service fund activities related to enterprise funds (1,792,862) Change in net assets of Business -type Activities $ 9,042,099 The notes to the financial statements are an integral part of this statement. 28 COLLIER COUNTY, FLORIDA STATEMENT OF CASH FLOWS PROPRIETARY FUNDS FOR THE FISCAL YEAR ENDED SEPTEMBER 30, 2010 Cash flows from operating activities: Cash received for services Cash received from other funds for services Cash received from employees for services Cash received from other governments for services Cash received from refundable deposits Cash received from retirees for services Cash payments on behalf of retirees Cash payments for goods and services Cash payments to employees Cash payments for interfund services Cash payments on refundable deposits Net cash provided by (used for) operating activities Cash flows from non - capital financing activities: Cash received from operating grants Cash transfers from other funds Cash transfers to other funds Net cash provided by (used for) non - capital financing activities Cash flows from capital and related financing activities: System development charges Special assessment collections Receipts from insurance reimbursements Proceeds from disposal of capital assets Proceeds from capital grants Proceeds from state revolving loans Proceeds from bond issue Payments for capital acquisitions Payments for bond closing costs Principal payments on state revolving loans Principal payments on bonds Principal payments on leases Interest and fiscal agent fees paid Net cash provided by (used for) capital and related financing activities Cash flows from investing activities: Interest on investments Net cash provided by investing activities Net Increase(decrease)in cash, cash equivalents and investments Business -type Activities Enterprise Funds Governmental County Activities - Water Solid Waste Other Internal Service and Sewer Disposal Funds Total Funds $ 101,056,410 $ 33,295,907 $ 14,334,535 $ 148,686,852 $ - - - - - 60,822,685 - 4,624,707 - - - - 386,172 41,000 806,587 - 847,587 - - - - - 1,080,767 (927,494) (24,794,117) (24,279,489) (10,792,797) (59,866,403) (64,331,778) (19,284,230) (1,366,374) (17,714,062) (38,364,666) (5,523,339) (6,581,347) (621,990) (5,050,906) (12,254,243) (933,861) (59,200) (832,518) (4,301) (896,019) 50,378,516 7,002,123 (19,227,531) 38,153,108 (4,802,141) 7,308 56,120 4,441,279 4,504,707 - 1,540,169 2,778,468 20,741,888 25,060,525 - (3,712,984) (4,041,272) (5,618,214) (13,372,470) (1,700,000) (2,165,507) (1,206,684) 19,564,953 16,192,762 (1,700,000) 8,219,945 - - 8,219,945 - 569,441 - - 569,441 - 37,760 2,296 61,785 101,841 1,362,872 51,884 - 12,008 63,892 14,100 288,000 3,420 411,537 702,957 - 6,291,674 - - 6,291,674 41,047 - - 41,047 (14,716,056) (1,439,830) (3,924,623) (20,080,509) (96,918) (103,377) - (103,377) - (6,918,878) - (6,918,878) - (5,274,324) - (5,274,324) - - - (179,042) (179,042) - (9,985,987) (28,875) (10,014,862) (21,498,871) (1,434,114) (3,647,210) (26,580,195) 1,280,054 1,276,484 188,982 71,377 1,536,843 377,623 1,276,484 188,982 71,377 1,536,843 377,623 27,990,622 4,550,307 (3,238,411) 29,302,518 (4,844,464) Cash, cash equivalents and investments, October 1, 2009 123,477,405 14,845,957 8,788,525 147,111,887 46,212,890 Cash, cash equivalents and investments, September 30, 2010 $ 151,468,027 $ 19,396,264 $ 5,550,114 $ 176,414,405 $ 41,368,426 Current cash, cash equivalents and investments $ 110,157,924 $ 19,141,059 $ 5,295,009 $ 134,593,992 $ 41,368,426 Current cash, cash equivalents and investments - restricted 3,327,694 255,205 255,105 3,838,004 - Noncurrent cash, cash equivalents and investments - restricted 37,982,409 37,982,409 Cash, cash equivalents and investments, September 30, 2010 $ 151,468,027 $_19,396,264 $ 5,550,114 $ 176,414,405 $ 41,368,426 (Continued) 29 COLLIER COUNTY, FLORIDA STATEMENT OF CASH FLOWS PROPRIETARY FUNDS (CONTINUED) RECONCILIATION OF OPERATING INCOME (LOSS) TO NET CASH PROVIDED BY (USED FOR) OPERATING ACTIVITIES FOR THE FISCAL YEAR ENDED SEPTEMBER 30, 2010 Operating Income (loss) Adjustments to reconcile operating income (loss) to net cash provided by (used for) operating activities: Depreciation expense Amortization of bond issuance costs Amortization of utility acquisition adjustment Net changes in assets and liabilities: Trade receivable Due from other funds Due from other governments Deposits Prepaid costs Inventory Prepaid costs Accounts payable Wages payable Due to other funds Due to other governments Due to individuals Compensated absences Refundable deposits Unearned revenue Self- insurance claims payable Net OPEB obligation Landfill post closure liability Total adjustments Net cash provided by (used for) operating activities Non -cash investing, capital and financing activities: Business -type Activities Enterprise Funds Governmental County Activities - Water Solid Waste Other Internal Service and Sewer Disposal Funds Total Funds $ 16,396,126 ",264,619 $ (21,584,975) _$ 1,075,770 _ $ (6,346,017) 32,761,066 699,857 2,767,500 36,228,423 2,071,722 548,393 - - 548,393 - 60,455 - - 60,455 - 143,651 88,958 (486,405) (253,796) (103,318) 2,433 368,787 - 371,220 (856,208) 293,113 - 9,141 302,254 37,314 (6,779) - - (6,779) 39,190 26,754 - 32,083 58,837 - (619,736) - (20,627) (640,363) (32,928) - - - (23,042) 451,051 (42,301) 78,158 486,908 631,809 107,418 11,856 73,654 192,928 165,831 (35) (370,178) (16,830) (387,043) (5,571) (274) 201 (29,577) (29,650) - (665) - 313 (352) - 233,745 19,551 (39,402) 213,894 300,456 (18,200) (1,300) (4,301) (23,801) - - (24,631) (6,263) (30,894) - - - - (720,000) 38,621 - (13,296) (13,296) 33,982,390 737,504 2,357,444 37,077,338 1,543,876 $ 50,378,516 $ 7,002,123 $ (19,227,531) _ $ 38,153,108 $ (4,802,141) The enterprise funds experienced a non -cash investing gain due to a change in the fair value of investments as follows: County Water and Sewer $ 185,189 Solid Waste 28,050 Other funds 9,823 Total $ 223,062 There were non -cash developer contributions of $1,664,505 in the County Water and Sewer District fund. There were non -cash capital asset transters out of the County Water and Sewer District tund as capital assets with a historical cost of $1,985 and $529 accumulated depreciation were transferred out to governmental activities. There were non -cash capital asset transfers in of $48,945 in the Nonmajor Business Type funds as capital assets with a historical cost of $466,702 and $417,757 of accumulated depreciation were transferred from governmental activities. The internal service funds experienced a net non -cash investing gain due to a change in the fair value of investments as follows: Internal service funds $ 47,437 There were non -cash capital asset transfers of $11,067,069 in the internal service funds. The notes to the financial statements are an integral part of this statement. 30 COLLIER COUNTY, FLORIDA STATEMENT OF FIDUCIARY ASSETS AND LIABILITIES AGENCY FUNDS SEPTEMBER 30, 2010 Agency Funds ASSETS Cash, cash equivalents and investments $ 32,536,268 Receivables: Interest 5,398 Other 29,757 Total assets $ 32,571,423 LIABILITIES Due to other governments $ 6,636,329 Due to individuals 1,886,327 Refundable deposits 23,127,876 Due to special assessment holders 920,891 Total liabilities $ 32,571,423 The notes to the financial statements are an integral part of this statement. 31 THIS PAGE INTENTIONALLY LEFT BLANK COLLIER COUNTY, FLORIDA NOTES TO THE FINANCIAL STATEMENTS SEPTEMBER 30, 2010 INDEX NOTE PAGE NUMBER 1 Summary of Significant Accounting Policies 34 2 Cash, Cash Equivalents and Investments 45 3 Trade Receivables 48 4 Interfund Payables and Receivables 48 5 Capital Assets 50 6 Long -Term Obligations 51 7 Conduit Debt Obligations 58 8 Defeased Debt 59 9 Pension Plan Obligations 60 10 Transfers 61 11 Net Assets /Fund Balances 62 12 Risk Management 63 13 Other Postemployment Benefits 65 14 Landfill Liability 70 15 Significant Contingencies 70 16 Significant Commitments 71 17 Fund Deficits 71 18 Impairment of Capital Asset 72 19 Subsequent Events 72 33 COLLIER COUNTY, FLORIDA NOTES TO THE FINANCIAL STATEMENTS SEPTEMBER 30, 2010 NOTE 1- SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES THE REPORTING ENTITY The primary government consists of Collier County, a political subdivision of the State of Florida that was established in 1923 by the Florida State Legislature. The County is governed by a Board of County Commissioners which consists of five members elected within single member districts. In addition, there are five separately elected Constitutional Officers: the Tax Collector, Property Appraiser, Sheriff, Clerk of the Circuit Court and Supervisor of Elections. The Constitutional Officers are elected county wide. Under the direction of the Clerk of the Circuit Court, the Collier County Finance and Accounting Department maintains the accounting system for the operations of the Board of County Commissioners, Supervisor of Elections and the Clerk of the Circuit Court. The Tax Collector, Property Appraiser and Sheriff each maintain their own accounting systems. For financial reporting purposes the operations of the Board of County Commissioners and the Constitutional Officers are combined and presented as the primary government. Component units are legally separate agencies that the primary government is financially accountable for or organizations which should be included in the reporting entity because of the nature and significance of their relationship with the primary government. Financial accountability is determined by the primary government's ability to appoint the voting majority of the entity's board, impose its will on the organization, and the existence of a financial benefit /burden relationship or fiscal dependency. The County's blended component units consist of organizations whose respective governing Boards are composed entirely of the Board of County Commissioners serving ex- officio. These entities are legally separate, however financial support has been pledged and financial or operational policies may be significantly influenced by the County. In accordance with Governmental Accounting Standards Board (GASB) Statement No. 14, The Financial Reporting Entity (GASB 14), as amended by GASB Statement No. 39, Determining Whether Certain Organizations are Component Units (GASB 39), these organizations are reported as if they were part of the County's operations. Collier County Water and Sewer District The District was established by Chapter 88 -499, as amended by Chapter 03 -353, Laws of Florida, to provide water, sewer and effluent services to portions of the unincorporated area of Collier County. Goodland Water District The District was established by a Special Referendum Election authorized by Collier County Ordinance 75 -5 and Section 125.01(q), Florida Statutes. The District provides potable water service to the residents of Goodland. Collier County Community Redevelopment Agency (CRA) The CRA was established by Resolution 2000 -82 to benefit blighted areas in both the Immokalee Redevelopment and Bayshore /Gateway Triangle Redevelopment areas. These two redevelopment areas are geographically separate and distinct. 34 COLLIER COUNTY, FLORIDA NOTES TO THE FINANCIAL STATEMENTS SEPTEMBER 30, 2010 NOTE 1— SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES — CONTINUED THE REPORTING ENTITY— CONTINUED Collier County Metropolitan Planning Organization (MPO) The Authority was created in 1981 by Collier County Resolution 81 -222 pursuant to Section 334.215, Florida Statutes, as amended by Section 339.175, Florida Statutes. The purpose of the MPO is to provide for short-term and long -term planning for all modes of travel in order to benefit the citizens of Collier County. The MPO is reported as part of the Grants and Shared Revenue fund. The County's discretely presented component units consist of organizations whose board members are appointed by the Board of County Commissioners. The County is able to impose its will on these entities because of its ability to remove appointed members from the component units' Boards. The Authorities maintain their own financial records, but do not issue separate financial statements. GASB 14, as amended by GASB 39, requires that the financial data of the following organizations be reported in separate columns to emphasize that they are legally separate from the County. Collier County Housing Finance Authority The Authority was formed in 1980 by Collier County Ordinance 80 -66 for the purpose of stimulating the construction of residential housing for low and moderate income families through the use of public financing. Their financial position and results of operations are reported in the accompanying financial statements and the outstanding conduit debt issued by the Authority is disclosed in Note 7, "Conduit Debt Obligations ". Collier County Health Facilities Authority The Authority was established in 1979 by Collier County Ordinance 79 -75 for the purpose of assisting health facilities in the acquisition, construction and financing of projects within the County. Their financial position and results of operations are reported in the accompanying financial statements and the outstanding conduit debt issued by the Authority is disclosed in Note 7, "Conduit Debt Obligations ". Collier County Industrial Development Authority The Authority was created in 1978 by Collier County Resolution 78 -94 to facilitate the financing of projects that promote economic growth and increase opportunities for employment in the County. Their financial position and results of operations are reported in the accompanying financial statements and the outstanding conduit debt issued by the Authority is disclosed in Note 7, "Conduit Debt Obligations ". Collier County Educational Facilities Authority The Authority was created in 1999 by Collier County Resolution 99 -177 to assist institutions for higher education in the construction, financing and refinancing of projects. Their financial position and results of operations are reported in the accompanying financial statements and the outstanding conduit debt issued by the Authority is disclosed in Note 7, "Conduit Debt Obligations ". 35 COLLIER COUNTY, FLORIDA NOTES TO THE FINANCIAL STATEMENTS SEPTEMBER 30, 2010 NOTE 1— SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - CONTINUED THE REPORTING ENTITY— CONTINUED Financial information on the individual component units can be obtained from their respective administrative offices or from the Finance and Accounting Department of the Clerk of the Circuit Court. Administrative Offices: Collier County Water and Sewer District and Goodland Water District 3339 East Tamiami Trail, Suite #214 Naples, Florida 34112 Bayshore Gateway Community Redevelopment Agency 4069 Bayshore Drive Naples, Florida 34112 Immokalee Community Redevelopment Agency 310 Alachua Street Immokalee, Florida 34142 Collier County Health Facilities Authority and Housing Finance Authority 5150 Tamiami Trail North, Suite #502 Naples, Florida 34103 Collier County Industrial Development Authority and Educational Facilities Authority 3050 N. Horseshoe Drive, Suite #120 Naples, Florida 34104 Collier County Metropolitan Planning Organization 2885 South Horseshoe Drive Naples, Florida 34104 GOVERNMENT WIDE AND FUND FINANCIAL STATEMENTS The basic financial statements are made up of the government wide financial statements and fund financial statements. Both of these sets of financial statements distinguish between the governmental and business type activities of Collier County. The government wide financial statements consist of a Statement of Net Assets and a Statement of Activities. These statements report on the financial condition of Collier County, at the reporting entity level. Internal balances represent net amounts due between the governmental and business -type activities. As a general rule, the effect of interfund activity has been eliminated from the government wide financial statements. Fiduciary funds are not included in these presentations as their assets do not represent amounts that are available for Collier County government operations. The Statement of Net Assets reports all financial and capital resources of Collier County's governmental and business -type activities. Net assets equal assets minus liabilities, and is shown in three categories: invested in capital assets, net of related debt; restricted net assets and unrestricted net assets. The Statement of Activities reports results of operations on a functional activity (program) basis and demonstrates to what degree the particular program has been self - supporting. Program revenues are reported in the following three categories: charges for services, operating grants and contributions and capital grants and contributions. Charges for services are amounts charged to customers for a particular service, and are netted against the cost of the relevant program. Internal charges for indirect services are allocated across functions as direct expenses. Grants and contributions refer to revenues restricted for capital or operational use in a particular program. The general revenue category encompasses all other revenue types and represents revenue collected to support all functions of Collier County government. 36 COLLIER COUNTY, FLORIDA NOTES TO THE FINANCIAL STATEMENTS SEPTEMBER 30, 2010 NOTE 1- SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES— CONTINUED GOVERNMENT WIDE AND FUND FINANCIAL STATEMENTS — CONTINUED When both restricted and unrestricted resources are available, restricted resources will be used first for incurred expenditures, and unrestricted as needed. The fund financial statements follow the government wide statements and report more detailed information about operations of major funds on an individual basis and nonmajor funds on an aggregate basis for the governmental and proprietary funds. Following the governmental fund balance sheet and statement of revenues, expenditures and changes in fund balances are reconciliations explaining the differences between the governmental fund presentation and the government wide presentation. BASIS OF PRESENTATION The following are reported as major governmental funds: General Fund — the General fund is the general operating fund of the County. All general tax revenues and other receipts that are not accounted for in other funds are accounted for in the General Fund. The general operating funds of the Clerk of the Circuit Court, Property Appraiser, Sheriff, Supervisor of Elections and Tax Collector are presented together with the Board of County Commissioners' general operating fund in the County's consolidated General Fund. Government Facilities Impact Fee Fund — the Government Facilities Impact Fee fund is used to account for the receipt and expenditure of government facilities impact fees collected from qualifying new construction. The impact fees must be used for the acquisition and construction of government facilities. Community Redevelopment Fund — the Community Redevelopment fund is used to account for the receipt and expenditure of tax increment revenues relating to the Bayshore /Gateway Triangle and Immokalee Community Redevelopment Authorities. The following are reported as major enterprise funds: County Water and Sewer Fund —the County Water and Sewer fund is used to account for the provision of water, wastewater and effluent services to certain portions of the Count's unincorporated area. Solid Waste Disposal Fund — the Solid Waste Disposal fund is used to account for the provision of solid waste disposal services to users throughout the County. 37 COLLIER COUNTY, FLORIDA NOTES TO THE FINANCIAL STATEMENTS SEPTEMBER 30, 2010 NOTE 1- SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES— CONTINUED BASIS OF PRESENTATION — CONTINUED Collier County also maintains the following nonmajor fund types: Special Revenue Funds — Special revenue funds are used to account for the accumulation of resources set aside for a specific purpose. Debt Service Funds — Debt service funds are used to account for the accumulation of resources for the payment of principal, interest and other expenditures on long -term obligations, other than bonds and notes payable from the operations of business -type activities. Capital Project Funds — Capital project funds are used to account for the acquisition and construction of major capital facilities other than those financed by proprietary funds. Enterprise Funds — Enterprise funds are used to account for activities for which a fee is charged to external users for goods or services. Internal Service Funds — Internal service funds are used to account for the provision of goods and services by one department to other departments within the County or to other governmental units on a cost reimbursement basis. Collier County currently operates the following Internal Service Funds: Self Insurance, Sheriffs Self Insurance, Fleet Management and Information Technology. Agency Funds — Agency funds are custodial in nature and do not report the results of operations (assets equal liabilities). Agency funds are clearing accounts for assets held by the government as an agent for individuals, private organizations or other governments. The Board of County Commissioners, Sheriff, Clerk of the Circuit Court and Tax Collector all maintain agency funds. BASIS OF ACCOUNTING AND MEASUREMENT FOCUS Basis of accounting refers to when revenues and expenditures or expenses are recognized in the accounts and reported in the financial statements. Basis of accounting relates to the timing of the measurements made regardless of the measurement focus applied. The government wide financial statements, as well as the fund financial statements for the proprietary funds, are reported using the economic resources measurement focus and the accrual basis of accounting. Revenues are recognized in the period in which they are earned and expenses are recognized in the period incurred. Grant revenues are recognized when eligibility requirements are met. The intent in proprietary operations is that the costs of providing goods or services to the general public be financed primarily through user charges, or where periodic determination of revenues earned, expenses incurred, and /or net income is deemed appropriate. 38 COLLIER COUNTY, FLORIDA NOTES TO THE FINANCIAL STATEMENTS SEPTEMBER 30, 2010 NOTE 1- SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES— CONTINUED BASIS OF ACCOUNTING AND MEASUREMENT FOCUS — CONTINUED Proprietary funds distinguish operating revenues and expenses from non - operating items. Operating revenues and expenses generally result from providing services and producing and delivering goods in connection with a proprietary fund's principal ongoing operations. Operating expenses for enterprise funds and internal service funds include the cost of sales and services, administrative expenses and depreciation on capital assets. All revenues and expenses not meeting this definition are reported as non - operating revenues and expenses. All governmental fund financial statements are reported using a current financial resources measurement focus and the modified accrual basis of accounting. Under the modified accrual basis of accounting, revenues are recognized in the period in which they become both measurable and available to finance expenditures of the current period. Available means collectible within the current period or soon enough thereafter, generally 60 days, to be used to pay liabilities of the current period. Primary revenues including non -grant intergovernmental revenues, charges for services and interest are treated as susceptible to accrual under the modified accrual basis. In applying the susceptibility -to- accrual concept to grant revenues, the legal and contractual requirements of the numerous individual programs are used as guidance. In addition, grant revenues are considered available if they are expected to be collected within one year of the end of the current fiscal period. Property taxes are discussed later in this footnote. Other revenue sources are not considered measurable and available and are not treated as susceptible to accrual. Expenditures are recorded when the related fund liability is incurred. Exceptions to this general rule include accrued compensated absences and principal and interest on long -term debt. BUDGETS AND BUDGETARY DATA The following are the statutory procedures followed by the Board of County Commissioners in establishing the budgets for the County: 1) Within fifteen days after certification of the ad valorem tax roll by the Property Appraiser, the County budget officer prepares and presents to the Board a tentative budget for the ensuing fiscal year. The budget includes all estimated receipts and all estimated expenditures, reserves and balances to be carried forward at the end of the year as specified in Section 129.03, Florida Statutes. 2) Within eighty days of the certification of value, but not earlier than sixty -five days after certification, the Board holds a public hearing on the tentative budget and proposed millage rate. At this hearing the Board amends and adopts the tentative budget, recomputes the proposed millage rate, and announces publicly the percentage, if any, by which the recomputed proposed millage rate exceeds the rolled -back rate. If the millage rate tentatively adopted exceeds that proposed, each taxpayer within the jurisdiction is notified of the increase by first class mail, at the expense of the Board. 39 COLLIER COUNTY, FLORIDA NOTES TO THE FINANCIAL STATEMENTS SEPTEMBER 30, 2010 NOTE 1- SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES— CONTINUED BUDGETS AND BUDGETARY DATA — CONTINUED 3) Within fifteen days of the meeting adopting the tentative budget, the Board advertises the County's intent to adopt a final budget and millage rate. 4) A public hearing is held by the Board to finalize the budget and adopt a millage rate. This hearing is held not less than two days and not more than five days after the day that the advertisement is first published. Prior to September 30, the millage levy is adopted by a separate vote. The millage rate adopted is not allowed to exceed the tentatively adopted millage rate, except as allowed for by emergency provision with strict public notice requirements. This is followed by the approval and ratification of the final budget. 5) The resolution approved at the final hearing is forwarded to the Property Appraiser, Tax Collector and Florida Department of Revenue, not later than thirty days following the adoption of the Resolution, the Board certifies to the State of Florida, Department of Revenue, Division of Ad Valorem Tax, that it has complied with the provisions of Chapter 200, Florida Statutes. 6) The County Manager approves intradepartmental budget changes less than $50,000 that do not alter the total expenditures of the department. All other budgetary changes must be approved by the Board of County Commissioners as a matter of policy. The initial adopted budget was amended in accordance with the Florida Statutes. 7) Florida Statute Section 129.07, as amended in 1978, provides that expenditures in excess of total fund budgets are unlawful. However, because the Board approves all budgetary changes between departments, except those approved by the County Manager, the departmental budget becomes the level of control. Formal budgetary integration is employed as a management control device during the fiscal year for all funds. Budgets have been legally adopted by the Board for all Board funds except for agency funds and the Impact Fees Escrow special revenue fund. The Property Appraiser and the Tax Collector adopt budgets for their general funds independently of the Board. The Clerk of Courts operates as a fee officer, and as such, prepares its budget in accordance with Section 218.35, Florida Statutes. The Sheriff and Supervisor of Elections prepare budgets for their general funds, which are submitted to and approved by the Board. The Clerk of Court's budget for court related functions is prepared according to Section 28.36 Florida Statutes and submitted to the Clerks of Court Operations Corporation for approval by the Florida Department of Revenue. 40 COLLIER COUNTY, FLORIDA NOTES TO THE FINANCIAL STATEMENTS SEPTEMBER 30, 2010 NOTE 1- SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES— CONTINUED BUDGETS AND BUDGETARY DATA — CONTINUED Budgets are adopted for all governmental funds except as described in the previous paragraph. These budgets are adopted on a basis consistent with generally accepted accounting principles (GAAP) except for certain non - budgeted revenues and expenses and mark to market activity on investments. All unencumbered appropriations lapse at the end of the current year. Capital project costs are budgeted in the year they are anticipated to be obligated. In subsequent years, the unused budget is reappropriated until the project is completed. Proprietary funds are budgeted on a basis consistent with generally accepted accounting principles, except that capital related and debt transactions are based upon cash receipts and disbursements. Estimated beginning fund balances are considered in the budgetary process. For purposes of the budgetary presentation, certain transactions that have been accounted for in the governmental funds statements of revenues, expenditures and changes in fund balances have not been reflected in the budgetary financial statements. Specifically, bad debt expense and the net change in fair value of investments are not presented in the budget to actual statements. CASH CASH EQUIVALENTS AND INVESTMENTS The County maintains a cash and investment pool that is available for use by all funds. The Clerk of the Circuit Court administers the investment pool pursuant to an investment policy established by the Board of County Commissioners under Florida Statute, Section 218. Subsequent to the amendment of Florida Statute 28.33, interest is allocated monthly to each fund based on the individual fund's average daily balance in the pool. Pursuant to the provisions of GASB Statement 31, Accounting and Financial Reporting for Certain Investments and for External Investment Pools, all investments are stated at fair value. Cash equivalents are short-term investments with maturities of three months or less from the date purchased. ACCOUNTS RECEIVABLE — UNBILLED REVENUE Unbilled charges for services are accrued in the County Water and Sewer, Emergency Medical Services and Goodland Water funds by prorating subsequent bills. INVENTORIES AND PREPAID COSTS Inventory is valued at cost using the first -in, first -out method. Inventory in the governmental funds consists of supplies held for consumption and land. The cost is recorded as an expenditure at the time inventory items are consumed rather than when purchased. Certain payments to vendors reflect costs applicable to future accounting periods and are recorded as prepaid items. Inventories and prepaid costs reported within governmental funds are offset by a reserve, which indicates that they do not constitute available resources. Inventories and prepaid costs in the government wide and proprietary fund financial statements are reported as an expense when consumed. 41 COLLIER COUNTY, FLORIDA NOTES TO THE FINANCIAL STATEMENTS SEPTEMBER 30, 2010 NOTE 1- SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES— CONTINUED CAPITAL ASSETS Land, buildings, improvements and equipment are stated at cost. Capital contributions are recorded at their fair value on the date donated. Facilities constructed using system development impact fees, collected from developers and customers, are stated at cost. The County capitalizes expenditures with a cost of $1,000 or more and with a useful life in excess of one year. Expenditures for maintenance and repairs are charged to operating expenses. The cost of assets retired or sold, together with the related accumulated depreciation, is removed from the accounts and any gain or loss on disposition is credited or charged to earnings. Depreciation is calculated using the straight -line method. The estimated useful life of the various classes of depreciable capital assets is as follows: Fixed Asset Estimated Useful Life Buildings 20 -45 years Infrastructure 3 -30 years Improvements other than buildings 4 -45 years Machinery and equipment 3 -10 years Costs incurred in the renourishment of beaches are included in the infrastructure class of capital assets and are capitalized and depreciated over three years. Infrastructure acquired prior to fiscal years ended June 30, 1980 is not reported. CAPITAL LEASE OBLIGATIONS In the government -wide financial statements and proprietary fund financial statements capital lease obligations and the related cost of assets acquired are reflected in the Statement of Net Assets. For capital lease obligations originating in governmental funds, an expenditure for the asset and the offsetting amount of the financing source is reflected in the fund financial statements in the year of inception. BOND PREMIUMS, DISCOUNTS AND ISSUANCE COSTS Bond premiums, discounts and issuance costs for the governmental activities and the business -type activities are deferred and amortized over the term of the bonds using the straight -line method. Bond discounts are presented as a reduction of the face amount of bonds payable, premiums as an increase, while issuance costs are recorded as deferred charges, which are shown on the face of the Statement of Net Assets as a component of noncurrent assets. In the governmental fund financials, bond premiums, discounts and issuance costs are recognized in the current period. DEFEASANCE OF DEBT For refundings resulting in the defeasance of debt, generally accepted accounting principles require that the difference between the reacquisition price and the net carrying amount of the old debt be deferred and amortized over the shorter of the life of the new debt or the remaining life of the old debt as a component of interest expense. The straight -line method is used for amortization of the deferred charge. 42 COLLIER COUNTY, FLORIDA NOTES TO THE FINANCIAL STATEMENTS SEPTEMBER 30, 2010 NOTE 1- SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES— CONTINUED INTEREST COST In the proprietary funds, interest costs are expensed or capitalized as required by the interest Topic 835, Subtopic 20, Section 30 "Amount of Interest to be Capitalized" of the FASB Accounting Standards Codification. PROPERTY TAXES Property taxes become due and payable on November 1st of each year and become delinquent on April 1st of the following year. Property taxes receivable and a corresponding allowance for uncollectible property taxes are not included in the financial statements, as delinquent taxes as of September 30, 2010 are not significant. Discounts on property taxes are allowed for payments made prior to the April 1st delinquent date as follows: November - 4%, December - 3 %, January - 2 %, and February - 1 %. Tax certificates for the full amount of any unpaid taxes must be sold not later than June 1st of each year. No accrual for the property tax levy becoming due in November 2010 is included in the accompanying financial statements, since such taxes are collected to finance expenditures of the subsequent period. Key dates in the property tax cycle for the fiscal year ended September 30, 2010 are as follows: Property Tax Cycle Date Assessment roll compiled Assessment roll certified Millage resolution approved Beginning of fiscal year for tax levy Taxes due and payable (levy date) Due date Delinquent (lien date) Tax certificates sold January 1, 2009 July 1, 2009 Within 35 days of the certification of the assessment roll October 1, 2009 November 1, 2009 March 31, 2010 April 1, 2010 Prior to June 1, 2010 APPLICATION OF FASB PRONOUNCEMENTS TO PROPRIETARY FUNDS In accordance with GASB Statement No. 20, Accounting and Financial Reporting for Proprietary Funds and Other Governmental Entities That Use Proprietary Fund Accounting, the County has elected not to apply private sector guidance issued after November 30, 1989. ACCOUNTING ESTIMATES The preparation of financial statements in conformity with generally accepted accounting principles requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results may differ from those estimated. 43 COLLIER COUNTY, FLORIDA NOTES TO THE FINANCIAL STATEMENTS SEPTEMBER 30, 2010 NOTE 1- SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES— CONTINUED UNEARNED REVENUE AND DEFERRED_ REVENUE In instances where assets have been received by the County for services to be rendered in future periods, asset balances are offset by an unearned revenue liability account in the financial statements. Examples of unearned revenues of the County as of September 30, 2010 are unspent State Housing Initiative Partnership (SHIP) monies and cash receipts associated with unspent advance grant agreements. Deferred revenue liabilities are reported in the governmental funds to offset receivables that do not meet the availability criterion under the modified accrual basis of accounting. Primary examples of the Count's deferred revenues are amounts associated with SHIP loans made to qualifying organizations and deferred impact fee agreements made with developers and individuals. ACCRUED COMPENSATED ABSENCES The County follows the provisions of GASB Statement No. 16, Accounting for Compensated Absences. This statement provides for the measurement of accrued vacation leave and other compensated absences using the pay or salary rates in effect at the balance sheet date. It also requires additional amounts to be accrued for certain salary related payments associated with the payment of compensated absences. It is the Board of County Commissioners' policy to allow employees of record on August 2, 1996 a sick leave payment upon termination for any service period earned prior to August 2, 1996 and 100% of allowable vacation hours at the current rate of pay. The Sheriffs policy allows for a percentage of unused sick leave payout based upon years of service, not to exceed 1,000 hours, and up to 400 hours of unused vacation time. Both the Clerk of the Circuit Court's and Tax Collector's policy's allow for a percentage of unused sick leave payout based upon years of service, and up to 240 hours of unused vacation hours. The Property Appraiser's policy allows for a percentage of unused sick leave payout based upon years of service, not to exceed 1,040 hours, and up to 240 hours of unused vacation hours. The Supervisor of Election's policy allows for a percentage of unused sick leave payout based upon years of service, and up to 440 hours of unused vacation. Payments for compensated absences are made by the respective fund. Accrued compensated absences are recorded as liabilities in the government -wide financial statements and the proprietary fund financials. A liability is reported in governmental funds only if they have matured, for example, as a result of employee resignations or retirements, and are considered due and payable as of yearend. IMPLEMENTATION OF NEW GASB PRONOUNCEMENTS Effective October 1, 2009 the County adopted the provisions of GASB Statement No. 51, Accounting and Financial Reporting for Intangible Assets, which establishes accounting and financial reporting standards for intangible assets. As a Phase I government for the purpose of implementing GASB Statement 34, Collier County has applied retroactive reporting for all material intangible assets except for those considered to have indefinite useful lives as of the effective date of the Statement and those considered to be internally generated. 44 COLLIER COUNTY, FLORIDA NOTES TO THE FINANCIAL STATEMENTS SEPTEMBER 30, 2010 NOTE 2 — CASH, CASH EQUIVALENTS AND INVESTMENTS As of September 30, 2010, the County had the following cash, cash equivalents and investments: Investment Cash on hand Demand deposits State Board of Administration Pool: Pool A Pool B FHLB - Multi Step Coupon US Treasury Note FHLMC - Multi Step Coupon FNMA FHLMC - Multi Step Coupon FHLMC- Multi Step Coupon FHLMC - Multi Step Coupon FNMA - Multi Step Coupon FHLMC - Multi Step Coupon FNMA - Multi Step Coupon FNMA - Multi Step Coupon FHLB - Multi Step Coupon FNMA- Multi Step Coupon Total Maturities Fair Value Call Date Call Frequency Rating N/A $ 92,605 N/A N/A N/A N/A 227,147,807 N/A N/A N/A N/A 712,243 N/A N/A AAAm N/A 20,354 N/A N/A N/A 10/5/2011 24,620,000 10/5/2010 one -time AAA 3/31/2012 10,098,800 none N/A AAA 6/7/2012 50,010,000 12/7/2010 one -time AAA 6/22/2012 25,320,250 none N/A AAA 6/29/2012 37,536,000 12/29/2010 continuous AAA 10/12/2012 25,002,000 10/12/2010 continuous AAA 4/26/2013 10,553,481 10/26/2010 continuous AAA 7/28/2014 25,070,250 7/28/2011 continuous AAA 7/28/2015 132,174,240 1/28/2011 continuous AAA 7/28/2015 11,894,095 1/28/2011 continuous AAA 8/12/2015 50,406,500 8/12/2011 continuous AAA 8/25/2015 10,509,870 8/25/2011 continuous AAA 9/1/2015 50,047,000 9/1/2011 continuous AAA $ 691,215,495 The County maintains a cash and investment pool that is available for use by all funds. Each fund's portion of this pool is displayed on the balance sheet under the heading of Cash, Cash Equivalents and Investments. Investment income is allocated monthly to participating funds based on the percentage of each fund's average daily balance in the total pool. CREDIT RISK Credit risk is the risk that an issuer or other counterparty to an investment will not fulfill its obligations. The County's investment practices are governed by Florida Statutes, Chapter 218 and the County's Investment Policy. The County's Investment Policy limits credit risk by restricting authorized investments to the Florida Local Government Surplus Trust Fund (SBA), direct obligations of, or obligations backed by the full faith and credit of the United States Government, U.S. government sponsored Corporation /Instrumentalities (except for Student Loan Marketing Association), certificates of deposit collateralized by U.S. Government Securities or Agencies, fixed income mutual funds collateralized by U.S. Government Securities or Agencies, domestic bankers' acceptances rated "AA" or higher, prime commercial paper rated "A -1" and "13-1 ", tax - exempt obligations rated "AA" or higher and issued by state or local governments, NOW accounts fully collateralized in accordance with Chapter 280, Florida Statutes and qualifying repurchase agreements. 45 COLLIER COUNTY, FLORIDA NOTES TO THE FINANCIAL STATEMENTS SEPTEMBER 30, 2010 NOTE 2 — CASH CASH EQUIVALENTS AND INVESTMENTS - CONTINUED The policy requires that each firm involved in a repurchase agreement must execute the County's master repurchase agreement, a third party custodian must hold collateral for all repurchase agreements with a term of more than one day and the market value of the collateral shall maintain a minimum price of 101 percent on U.S. Government securities and 104 percent on Agencies and Instrumentalities with a term over five (5) years, and must be marked to market at least weekly. The SBA is an investment pool administered by the State Board of Administration, under the regulatory oversight of the State of Florida. The SBA operates two pools, Florida PRIME and Fund B Surplus Trust Fund (Fund B), with the Fund B carrying a AAAm rating from Standard & Poor's. At September 30, 2010, the Sheriff had $732,597 invested in the State Board of Administration's Local Government Surplus Funds Trust Fund Investment Pool. Of this amount, $712,243 is invested in the Florida PRIME and $20,354 in Fund B. The Florida PRIME investment is fully liquid and carries a weighted average days to maturity of 52 days. Fund B is accounted for as a fluctuating net asset value pool and the fair value factor for September 30, 2010 was .70706. Fund B amount has a weighted average life of 7.49 years. Fund B cash holdings continue to be distributed to participants as they become available from maturities, sales and income received. All cash deposits are held in qualified public depositories pursuant to Florida Statutes Chapter 280, "Florida Security for Public Deposits Act ". Under the Act, all qualified public depositories are required to pledge eligible collateral having a market value equal to or greater than the average daily or monthly balance of all public deposits, multiplied by the depository's collateral pledging level. The pledging level may range from 50% to 125% depending upon the depository's financial condition. Any losses to public deposits are covered by applicable deposit insurance, sale of securities pledged as collateral, and if necessary, assessments against other qualified public depositories of the same type as the depository in default. CUSTODIAL CREDIT RISK The policy requires execution of a third -party custodial safekeeping agreement for purchased securities and collateral, and requires that securities be held in the County's name. At September 30, 2010, the County had demand deposits of $227,147,807. These demand deposits do not include discretely presented component unit deposits of $459,432. All balances in excess of the Federal Depository Insurance Corporation insurance for demand deposits are fully collateralized by the multiple financial institutions' collateral pool in accordance with Florida Statutes Section 280. INTEREST RATE RISK Interest rate risk is the risk that changes in market interest rates will adversely affect the fair value of an investment. One of the primary objectives of the investment policy is to match investment cash flow and maturity with known cash needs and anticipated cash flow requirements. The County limits exposure to interest rate risk by structuring the portfolio to meet daily cash flow demands. Investments shall have an average maturity of not more than five years, except for mortgage securities. Mortgage securities will not be used to match liabilities that are reasonably definable as to amount and disbursement date and are used to invest funds associated with reserves or liabilities that are not associated with a specifically identified cash flow schedule. 46 COLLIER COUNTY, FLORIDA NOTES TO THE FINANCIAL STATEMENTS SEPTEMBER 30, 2010 NOTE 2 — CASH, CASH EQUIVALENTS AND INVESTMENTS - CONTINUED CONCENTRATION OF CREDIT RISK The County's investment policy establishes limitations on portfolio composition in order to control credit risk. The policy allows 100 percent of the portfolio to be invested in U.S. Government Securities, Agencies and Instrumentalities (excluding mortgage securities), 50 percent to be invested in SBA, 30 percent to be invested in certificates of deposit, 20 percent to be invested in qualifying repurchase agreements and 10 percent each in the categories of fixed income mutual funds, domestic bankers' acceptances, prime commercial paper and tax - exempt obligations. The portion of the County's portfolio invested in U.S. Government Instrumentalities is detailed as follows, at September 30, 2010: Reconciliation of cash, cash equivalents and investments to the basic financial statements: Primary government: Cash, cash equivalents and investments Restricted cash, cash equivalents and investments - current Restricted cash, cash equivalents and investments - noncurrent Agency funds: Cash, cash equivalents and investments Total 47 $ 364,232,107 18,329,332 276,117,788 32,536,268 $ 691,215,495 Percent of Issuer Portfolio Federal Home Loan Bank 5.08% Federal Home Loan Mortgage Corporation 36.93% Federal National Mortgage Association 23.54% Total U.S. Government Instrumentalities 65.55% Reconciliation of cash, cash equivalents and investments to the basic financial statements: Primary government: Cash, cash equivalents and investments Restricted cash, cash equivalents and investments - current Restricted cash, cash equivalents and investments - noncurrent Agency funds: Cash, cash equivalents and investments Total 47 $ 364,232,107 18,329,332 276,117,788 32,536,268 $ 691,215,495 COLLIER COUNTY, FLORIDA NOTES TO THE FINANCIAL STATEMENTS SEPTEMBER 30, 2010 NOTE 3 - TRADE RECEIVABLES Trade receivables for Governmental and Business -type Activities are net of an allowance for doubtful accounts as follows: County Water and Sewer Solid Waste Disposal Nonmajor Enterprise Funds Total Business -type Activities trade receivables NOTE 4 - INTERFUND PAYABLES AND RECEIVABLES ADVANCES $ 6,231,944 $ 363,462 $ 5,868,482 613,783 - 613,783 3,590,855 3,766 3,587,089 $ 10,436,582 $ 367,228 $ 10,069,354 Advances to and advances from other funds at September 30, 2010 were as follows: Governmental Activities: General Fund Government Facilities Impact Fees Fund Other governmental funds: Community Development Fund Capital Improvement Revenue Bonds Fund Parks Improvement Fund County -Wide Capital Improvements Fund County -Wide Library Impact Fees Fund Correctional Facilities Impact Fees Fund Emergency Medical Services Impact Fees Fund Law Enforcement Impact Fees Fund Total Governmental Activities Business -type Activities: County Water and Sewer Solid Waste Disposal Total Business -type Activities Total Advances Advance Advance To From $ 9,317,325 $ - - 19,828,091 1,400,000 19,570,778 1,400,000 34,667,600 - - 9,715,125 - 2,408,700 - 2,333,900 - 13,688,000 45,384,925 68,944,594 18,550,000 5,009,669 - 23,559,669 $ 68,944,594 $ 68,944,594 Advances are made to various funds for the purposes of capital improvements and the funding of certain surety requirements. Reimbursements will take place over the next several years. 48 Trade Allowance for Net Trade Receivables Doubtful Accounts Receivables General Fund $ 517,597 $ 94,825 $ 422,772 Government Facilities Impact Fee 445 - 445 Nonmajor Governmental Funds 3,532,345 72,311 3,460,034 Total receivables reported in Governmental Funds 4,050,387 167,136 3,883,251 Total receivables reported in Internal Service Funds 154,595 10,867 143,728 Total Governmental Activities trade receivables $ 4,204,982 $ 178,003 $ 4,026,979 County Water and Sewer Solid Waste Disposal Nonmajor Enterprise Funds Total Business -type Activities trade receivables NOTE 4 - INTERFUND PAYABLES AND RECEIVABLES ADVANCES $ 6,231,944 $ 363,462 $ 5,868,482 613,783 - 613,783 3,590,855 3,766 3,587,089 $ 10,436,582 $ 367,228 $ 10,069,354 Advances to and advances from other funds at September 30, 2010 were as follows: Governmental Activities: General Fund Government Facilities Impact Fees Fund Other governmental funds: Community Development Fund Capital Improvement Revenue Bonds Fund Parks Improvement Fund County -Wide Capital Improvements Fund County -Wide Library Impact Fees Fund Correctional Facilities Impact Fees Fund Emergency Medical Services Impact Fees Fund Law Enforcement Impact Fees Fund Total Governmental Activities Business -type Activities: County Water and Sewer Solid Waste Disposal Total Business -type Activities Total Advances Advance Advance To From $ 9,317,325 $ - - 19,828,091 1,400,000 19,570,778 1,400,000 34,667,600 - - 9,715,125 - 2,408,700 - 2,333,900 - 13,688,000 45,384,925 68,944,594 18,550,000 5,009,669 - 23,559,669 $ 68,944,594 $ 68,944,594 Advances are made to various funds for the purposes of capital improvements and the funding of certain surety requirements. Reimbursements will take place over the next several years. 48 COLLIER COUNTY, FLORIDA NOTES TO THE FINANCIAL STATEMENTS SEPTEMBER 30, 2010 NOTE 4 - INTERFUND PAYABLES AND RECEIVABLES— CONTINUED DUE FROM AND DUE TO Interfund receivables and payables generally result from recording the excess fees associated with Tax Collector and Property Appraiser services, as excess fees are allocated from the General Fund back to the funds that paid for the collection services. Excess fees are calculated after year end, and as such are interfund receivables and payables. Other outstanding balances are the result of time delays between the provision and payment of interfund services and to cover temporary cash deficits. Due from and due to other funds at September 30, 2010 were as follows: 49 Due From Due To Governmental Activities: General Fund $ 4,159,299 $ 1,782,384 Other Governmental Funds: Road Districts 4,301 28 Unincorporated Area MSTD 360,494 11,287 Community Development - 8,583 Water Management and Pollution Control 48,997 - Grants and Shared Revenues 28,960 3,920,287 Improvement Districts 38,996 5,044 Fire Control Districts 37,331 - Lighting Districts 7,910 - 911 Enhancement Fee - 135,901 Tourist Development 114,033 915 State Housing Initiative Partnership - 246 State Court Administration 32,224 - Conservation Collier 92,933 - Other Special Revenue Funds - 100,884 Caribbean Gardens Loan 12,569 - Stormwater Improvement Assessment Bonds 1,006 - Limited General Obligation Conservation Collier Bonds 82,960 - Forest Lakes Limited General Obligation Bonds 5,598 - County -Wide Capital Improvements - 161 Parks Improvements 36,374 55 Water Management - 331 Parks Impact Districts 69 Road Impact Districts - 1,489 Road Construction 215,215 - Other Capital Projects 314 - Totalothergovernmentalfunds 1,120,215 4,185,280 Business -type Activities: County Water and Sewer 30,711 277 Solid Waste 44,868 26,257 Other Business -type funds: Emergency Medical Services - 244 Collier Area Transit 225,893 Total other business -type funds 226,137 Internal Service Funds 869,997 4,755 Total All Funds $ 6,225,090 $ 6,225,090 49 COLLIER COUNTY, FLORIDA NOTES TO THE FINANCIAL STATEMENTS SEPTEMBER 30, 2010 NOTE 5 — CAPITAL ASSETS A summary of capital asset activity for the year ended September 30, 2010 is as follows: Capital assets depreciated Buildings October 1, 4,064,268 Deductions/ September 30, Infrastructure 2009 Additions Reclassifications 2010 Governmental Activities: 207,070,537 1,903,632 8,863,321 217,837,490 Capital assets not depreciated: 161,577,834 12,559,856 (9,894,650) 164,243,040 Land and other non - depreciable assets $ 366,860,067 $ 7,813,168 $ 3,373,388 $ 378,046,623 Construction in progress 250,343,771 52,466,062 (229,847,961) 72,961,872 Total capital assets not depreciated 617,203,838 60,279,230 (226,474,573) 451,008,495 Capital assets depreciated Buildings 418,380,224 4,064,268 11,971,340 434,415,832 Infrastructure 692,017,447 1,245,744 202,366,522 895,629,713 Improvements other than buildings 207,070,537 1,903,632 8,863,321 217,837,490 Machinery and equipment 161,577,834 12,559,856 (9,894,650) 164,243,040 Total capital assets depreciated 1,479,046,042 19,773,500 213,306,533 1,712,126,075 Less accumulated depreciation Buildings 81,999,052 13,682,283 (5,130) 95,676,205 Infrastructure 198,209,144 31,423,852 - 229,632,996 Improvements other than buildings 57,709,387 10,123,175 (1,513,334) 66,319,228 Machinery and equipment 113,680,707 16,558,511 (9,964,820) 120,274,398 Total accumulated depreciation 451,598,290 71,787,821 (11,483,284) 511,902,827 Total depreciable capital assets, net 1,027,447,752 (52,014,321) 224,789,817 1,200,223,248 Total Governmental Activities 29,066,196 3,193,553 (1,664,919) 30,594,830 capital assets, net $ 1,644,651,590 $ 8,264,909 $ (1,684,756) $ 1,651,231,743 Business -type Activities: Capital assets not depreciated Land and other non - depreciable assets $ 24,379,578 $ 45,000 $ (123,757) $ 24,300,821 Construction in progress 63,284,419 18,201,606 (15,226,113) 66,259,912 Total capital assets not depreciated 87,663,997 18,246,606 (15,349,870) 90,560,733 Capital assets depreciated: Buildings 135,368,681 233,623 1,019,893 136,622,197 Improvements other than buildings 953,298,818 1,715,390 4,388,248 959,402,456 Machinery and equipment 29,066,196 3,193,553 (1,664,919) 30,594,830 Total capital assets depreciated 1,117,733,695 5,142,566 3,743,222 1,126,619,483 Less accumulated depreciation: Buildings Improvements other than buildings Machinery and equipment Total accumulated depreciation Total depreciable capital assets, net Total Business -type Activities capital assets, net 59,953,152 3,502,567 - 63,455,719 213,123,145 29,577,368 (374,165) 242,326,348 18,144,613 3,148,488 (1,524,489) 19,768,612 291,220,910 36,228,423 (1,898,654) 325,550,679 826,512,785 (31,085,857) 5,641,876 801,068,804 $ 914,176,782 $ (12,839,251) $ (9,707,994) $ 891,629,537 50 COLLIER COUNTY, FLORIDA NOTES TO THE FINANCIAL STATEMENTS SEPTEMBER 30, 2010 NOTE 5 -CAPITAL ASSETS - CONTINUED Schedule of depreciation for fiscal year 2010: General Government $ 8,227,535 Public Safety 14,720,592 Physical Environment 7,024,953 Transportation 30,428,408 Economic Environment 28,924 Human Services Premium or 717,605 Culture and Recreation 8,568,082 Subtotal October 1, 69,716,099 Internal Service Funds 2,071,722 Total Governmental Activities $ 71,787,821 Water and Sewer $ 32,817,396 Solid Waste Additions 699,857 EMS 654,111 Airport Authority one year 888,016 Mass Transit 1,169,043 Total Business-type Activities $ 36,228,423 NOTE 6 - LONG -TERM OBLIGATIONS SUMMARY OF CHANGES IN LONG -TERM OBLIGATIONS The following is a summary of changes in long -term obligations for the year ended September 30, 2010: 51 000's Omitted Premium or October 1, Discount /Loss September 30, Due within 2009 Additions Reductions Amortized, net 2010 one year Governmental Activities: Bonds and Loans Payable $ 519,414 $ 60,739 $ (94,008) $ (1,011) $ 485,134 $ 29,404 Arbitrage Rebate 315 - (315) - - - CapitalLeaseObligations 599 - (160) - 439 170 Self - Insurance Claims 9,329 - (720) - 8,609 5,547 Net OPEB Obligation 1,381 103 - - 1,484 - Compensated Absences 21,786 7,733 (7,598) - 21,921 10,652 Total $ 552,824 $ 68,575 $ (102,801) $ (1,011) $ 517,587 $ 45,773 Business -type Activities: Bonds and Loans Payable $ 260,836 $ 17,846 $ (23,643) $ 180 $ 255,219 $ 11,853 Notes Payable 72 - - - 72 72 Arbitrage Rebate 994 - (994) - - - Capital Lease Obligations 492 323 (179) - 636 250 Landfill Closure Liability 1,914 - (13) - 1,901 - Compensated Absences 2,442 2,237 (2,023) 2,656 1,859 Total $ 266,750 $ 20,406 $ (26,852) $ 180 $ 260,484 $ 14,034 51 COLLIER COUNTY, FLORIDA NOTES TO THE FINANCIAL STATEMENTS SEPTEMBER 30, 2010 NOTE 6 - LONG -TERM DEBT - CONTINUED DESCRIPTIONS OF BONDS, LOANS AND NOTES PAYABLE Bonds, loans and notes payable at September 30, 2010 were composed of the following: GOVERNMENTAL ACTIVITIES Governmental Activities Limited General Obligation Bonds $32,815,000 2005A Limited General Obligation Bonds, Conservation Collier Program, due in annual installments of $3,285,000 to $4,805,000 through January 1, 2013; interest at 3.00'% to 5.00 %. $ 13,735,000 $13,244,204 2008 Limited General Obligation Bonds, Conservation Collier Program, due in annual installments of $3,067,279 to $3,529,181 through January 1, 2013; interest at 4.14 %. 10,176,925 $6,215,000 2007 Limited General Obligation Bonds, Forest Lakes Roadway and Drainage Municipal Service Taxing Unit, due in installments of $300,000 to $540,000 through January 1, 2022; interest at 3.75% to 4.25 %. 5,250,000 Total Governmental Activities Limited General Obligation Bonds $ 29,161,925 Governmental Activities Revenue Bonds $47,430,000 2002 Capital Improvement Revenue Bonds due in annual installments of $1,780,000 to $2,830,000 through October 1, 2016; interest at 1.60% to 5.00 %. $ 27,740,000 $49,360,000 2003 Capital Improvement and Refunding Revenue Bonds due in annual installments of $1,130,000 to $2,570,000 through October 1, 2033; interest at 2.00% to 4.75 %. 36,910,000 $167,200,000 2005 Capital Improvement and Refunding Revenue Bonds due in annual installments of $2,035,000 to $7,240,000 through October 1, 2035; interest at 2.25% to 5.00 %. 143,635,000 $102,125,000 2003 Gas Tax Revenue Bonds, due in annual installments of $1,495,000 to $6,865,000 through June 1, 2023; interest at 2.00% to 5.25 %. 59,340,000 $96,255,000 2005 Gas Tax Revenue Bonds, due in annual installments of $445,000 to $13,985,000 through June 1, 2025; interest at 3.00% to 5.00 %. 93,590,000 $59,895,000 2010 Special Obligation Revenue Bonds, due in annual installments of $1,545,000 to $3,860,000 through July 1, 2034; interest at 3.00% to 4.50 %. 59,895,000 $1,870,000 1997 Naples Park Area Stormwater Improvement Assessment Bonds due in annual installments of $75,000 to $185,000 through September 1, 2012; interest at 6.45% fixed rate. 175,000 Total Governmental Activities Revenue Bonds $ 421,285,000 52 COLLIER COUNTY, FLORIDA NOTES TO THE FINANCIAL STATEMENTS SEPTEMBER 30, 2010 NOTE 6 - LONG -TERM DEBT - CONTINUED DESCRIPTIONS OF BONDS, LOANS AND NOTES PAYABLE - CONTINUED Governmental Activities Loans and Notes Payable $12,000,000 Florida Department of Transportation State Infrastructure Bank Loan, due in annual installments of $1,839,148 to $4,414,096 through October 1, 2012; interest at 2.0 %. $13,500,000 Bayshore Gateway Community Redevelopment Agency Taxable Note, due September 1, 2014; monthly variable interest rate of 30 -Day LIBOR plus 3.75 %. Total Governmental Activities Loans and Notes Payable Total Governmental Activities Obligations Unamortized Bond Discount Unamortized Bond Premium Deferred Loss on Bond Refunding Governmental Activities Obligations, Net Less Current Portion of Governmental Activities Obligations Long -Term Portion of Governmental Activities Obligations, Net BUSINESS -TYPE ACTIVITIES Business -type Activities Revenue Bonds $33,630,000 2003B County Water and Sewer Refunding Revenue Bonds due in annual installments of $1,410,000 to $4,125,000 through July 1, 2021; interest at 4.25% to 5.50 %. $110,165,000 2006 Collier County Water and Sewer Revenue Bonds due in annual installments of $2,310,000 to $8,695,000, commencing July 1, 2017 through July 1, 2036; interest at 4.00% to 5.00 %. $11,727,489 2009 Collier County Water and Sewer Revenue Bonds due in annual installments of $1,569,324 to $1,817,005, commencing July 1, 2010 through July 1, 2016; interest at 2.97 %. Total Business -type Activities Revenue Bonds 53 $ 8,203,474 11,486,000 19,689,474 470,136,399 (506,061) 15,691,991 (188,439) 485,133,890 (29,403,527) $ 455,730,363 $ 28,660,000 110,165,000 10,158,165 $ 148,983,165 COLLIER COUNTY, FLORIDA NOTES TO THE FINANCIAL STATEMENTS SEPTEMBER 30, 2010 NOTE 6 - LONG -TERM DEBT - CONTINUED DESCRIPTIONS OF BONDS, LOANS AND NOTES PAYABLE — CONTINUED Business -Type Activities Loans and Notes Payable $166,580 County Water and Sewer District agreement with private developer payable through use of sewer system development fee credits. Non - interest bearing agreement. $ 71,675 $14,547,667 County Water and Sewer District State Revolving Fund Loan, interest payable at 4.25% payable in 20 semiannual payments commencing October 1, 1992. 1,993,921 $13,292,898 County Water and Sewer District State Revolving Fund Loan, interest payable at 2.65% payable in 40 semiannual payments commencing January 15, 1999. 6,339,179 $22,238,677 County Water and Sewer District State Revolving Fund Loan, interest payable at 3.05% payable in 40 semiannual payments commencing November 15, 2001. 13,577,249 $5,160,675 County Water and Sewer District State Revolving Fund Loan, interest payable at 3.05% payable in 40 semiannual payments commencing October 15, 2004. 3,925,323 $6,560,956 County Water and Sewer District State Revolving Fund Loan, interest payable at 3.05% payable in 40 semiannual payments commencing January 15, 2005. 4,987,042 $29,224,004 County Water and Sewer District State Revolving Fund Loan, interest payable at 2.95% payable in 40 semiannual payments commencing June 15, 2006. 24,049,234 $10,525,509 County Water and Sewer District State Revolving Fund Loan, interest payable at 2.90% payable in 40 semiannual payments commencing September 15, 2006. 8,295,196 $5,445,223 County Water and Sewer District State Revolving Fund Loan, interest payable at 2.92% payable in 40 semiannual payments commencing December 15, 2005. 4,384,830 $5,188,500 County Water and Sewer District State Revolving Fund Loan, interest payable at 2.74% payable in 40 semiannual payments commencing November 15, 2007. 3,602,332 $7,123,496 County Water and Sewer District State Revolving Fund Loan, interest payable at 2.75% and 2.64% payable in 40 semiannual payments commencing April 15, 2008. 4,940,807 $17,577,022 County Water and Sewer District State Revolving Fund Loan, interest payable at 2.64% and 2.79% payable in 40 semiannual payments commencing August 15, 2008. 16,174,642 $11,637,070 County Water and Sewer District State Revolving Fund Loan, interest payable at 2.64% and 2.79% payable in 40 semiannual payments commencing October 15, 2009. 11,373,978 54 COLLIER COUNTY, FLORIDA NOTES TO THE FINANCIAL STATEMENTS SEPTEMBER 30, 2010 NOTE 6 - LONG -TERM DEBT - CONTINUED DESCRIPTIONS OF BONDS LOANS AND NOTES PAYABLE — CONTINUED $3,294,890 County Water and Sewer District State Revolving Fund Loan, interest payable at 2.79% payable in 40 semiannual payments commencing December 15, 2009. 2,793,739 Total Business -type Activities Loans and Notes Payable $ 106,509,147 Total Business -type Activities Obligations $ 255,492,312 Unamortized Bond Premium 4,445,607 Deferred Loss on Bond Refunding (4,646,783) Business -type Activities Obligations, Net $ 255,291,136 Less Current Portion of Business -type Activities Obligations Payable from Unrestricted Assets (9,352,464) Less Current Portion of Business -type Activities Obligations Payable from Restricted Assets (2,572,541) Long -Term Portion of Business -type Activities Obligations, Net $ 243,366,131 SUMMARY OF DEBT SERVICE REQUIREMENTS TO MATURITY The total annual debt service requirements to maturity of long -term debt, excluding compensated absences, capitalized leases, premiums, discounts and arbitrage rebate liability, are as follows: Governmental Activities Fiscal Year Limited General Obligation Bonds Revenue Bonds Loans and Notes Payable Totals Principal Interest Principal Interest Principal Interest 2011 $ 7,962,597 $ 1,137,371 $ 18,665,000 $ 19,250,486 $ 2,775,930 $ 925,281 $ 50,716,665 2012 8,330,147 763,174 19,405,000 18,561,293 2,813,449 825,894 50,698,957 2013 8,714,181 371,544 19,335,000 17,697,993 5,314,095 725,758 52,158,571 2014 390,000 163,475 17,495,000 16,874,426 8,786,000 575,608 44,284,509 2015 410,000 147,475 17,710,000 16,059,296 - - 34,326,771 2016 -20 2,295,000 471,475 101,755,000 66,952,867 - - 171,474,342 2021 -25 1,060,000 45,475 119,375,000 40,524,254 - - 161,004,729 2026 -30 - - 49,435,000 19,444,632 - - 68,879,632 2031 -35 - - 51,575,000 7,603,724 - - 59,178,724 2036 -40 - - 6,535,000 151,121 - - 6,686,121 Totals $ 29,161,925 $ 3,099,989 $ 421,285,000 $ 223,120,092 $ 19,689,474 $ 3,052,541 $ 699,409,021 55 COLLIER COUNTY, FLORIDA NOTES TO THE FINANCIAL STATEMENTS SEPTEMBER 30, 2010 NOTE 6 - LONG -TERM DEBT — CONTINUED SUMMARY OF DEBT SERVICE REQUIREMENTS TO MATURITY— CONTINUED Business -tvoe Activities Fiscal Loans and Year Revenue Bonds Notes Payable Totals Principal Interest Principal Interest 2011 $ 4,969,157 $ 6,710,800 $ 6,955,847 $ 3,027,016 $ 21,662,820 2012 5,188,936 6,494,196 7,103,166 2,814,904 21,601,202 2013 5,422,044 6,267,614 6,261,502 2,595,968 20,547,128 2014 5,630,093 6,058,578 6,442,535 2,414,936 20,546,142 2015 5,885,930 5,792,443 6,628,818 2,228,653 20,535,844 2016 -20 19,867,005 25,942,803 34,323,887 8,190,507 88,324,202 2021 -25 24,265,000 21,150,125 29,729,420 3,485,371 78,629,916 2026 -30 30,790,000 14,623,900 9,063,972 407,747 54,885,619 2031 -35 38,270,000 7,144,977 - - 45,414,977 2036 -40 8,695,000 386,928 - - 9,081,928 Totals $ 148,983,165 $ 100,572,364 $ 106,509,147 $ 25,165,102 $ 381,229,778 LEGAL DEBT MARGIN The Constitution of the State of Florida and the Florida Statutes set no legal debt limit. RESTRICTIVE COVENANTS According to the official statements and County resolutions authorizing the issuance of the Series 2002, 2003 and 2005 Capital Improvement Revenue and Refunding Revenue Bonds, as well as the Series 2003 and 2005 Gas Tax Revenue Bonds, the issues are payable from and secured by liens on the local government half -cent sales tax and gas tax revenues, respectively. During fiscal year 2008 Collier County experienced insurer rating downgrades on its Series 2002, 2003 and 2005 Capital Improvement Revenue Refunding Bonds. The covenants related to these issues require that in the event of an insurer downgrade below "A ", by either Moody's or Standard and Poor's, the County must fund a cash reserve to replace the surety within twelve months. By September 30, 2009 Collier County was required to fund the reserve in the amount of $19,570,777, which represents the maximum remaining annual debt service on the outstanding Capital Improvement Bonds and which is included in non - current restricted cash, cash equivalents and investments in the Statement of Net Assets. The County used internal borrowings to achieve the required reserve funding and the reserve remained funded as of September 30, 2010. Interest earned on the reserve is assigned to the funds from which the advances were made. All required principal and interest payments have been made in a timely manner on these bonds and the County's pledged coverage on these bonds was 1.39 for the fiscal year ended September 30, 2010. For further information please see Note 18, Subsequent Events. During fiscal year 2010, Collier County issued the Series 2010 Special Obligation Revenue Bonds. According to the official statements and County resolutions authorizing the issuance of these bonds, the County has covenanted and agreed, subject to certain restrictions and limitations, to appropriate in its annual budget, by amendment, if necessary, from non -ad valorem revenues amounts sufficient to pay the principal and interest on the Series 2010 Bonds. 56 COLLIER COUNTY, FLORIDA NOTES TO THE FINANCIAL STATEMENTS SEPTEMBER 30, 2010 NOTE 6 - LONG -TERM DEBT — CONTINUED RESTRICTIVE COVENANTS —CONTINUED The 1997 Naples Park Area Stormwater Improvement Assessment Bonds are limited special obligations of the County, payable solely from the proceeds of stormwater improvement assessments. Tax increment revenues and a covenant to budget and appropriate from all legally available CRA non -ad valorem revenues is pledged for the repayment of the Bayshore Gateway Community Redevelopment Agency's taxable note. The average of actual receipts and cash carried forward from the previous year must cover annual debt service requirements by 125 %. The agency was in compliance with this covenant for the year ended September 30, 2010. Water and sewer revenue bonds are payable solely from and secured by a first lien upon and pledge of the net revenues and certain other fees and charges derived from operation of the County's water and sewer system. The pledge of net revenues derived by the County from the operation of the system does not constitute a lien upon the system or any other property of the County. The covenants of the resolutions authorizing the County Water and Sewer District Bonds, Series 2009, Series 2006 and 2003B include an obligation for the County to fix, establish and maintain such rates and collect such fees, rentals or other charges for the services and facilities of the water and sewer system, and to revise the same whenever necessary, so as to provide in each year net revenues, as defined in the resolutions authorizing the revenue bonds, which together with system development fees and special assessment proceeds received shall be adequate to pay at least 125% of the annual debt service requirements for the Water and Sewer Bonds; provided, however, that net revenues in each fiscal year shall be adequate to pay at least 100% of the annual debt service for the bonds. In addition, bond covenants require a renewal and replacement amount equal to $300,000 to be set aside in the County Water and Sewer District Funds. The water and sewer funds were in compliance with these covenants for the year ended September 30, 2010. The Collier County Water and Sewer District has several State Revolving Fund loans outstanding with the Florida Department of Environmental Protection. These loans are collateralized by a lien on pledged revenues consisting of net revenues from the operations of the County Water and Sewer System and system development fees. The lien shall be subordinate in all respects to liens placed upon pledged revenues established by bonded indebtedness. The County Water and Sewer District shall maintain rates and charges for services which together with system development fees sufficient to pay 115% of the annual debt service requirements on the loans, as well as satisfy the coverage requirements of all senior debt obligations. The County Water and Sewer District State Revolving funds were in compliance with these covenants for the year ended September 30, 2010. INTEREST CAPITALIZED Interest costs on the long -term debt of business -type activities, including capitalized leases, incurred and capitalized during the year ended September 30, 2010 were as follows: Business -type Activities Total Interest Cost Incurred $ 9,754,676 Interest Cost Capitalized $ 399,454 Interest expense is shown as a direct expense of the Business -type Activities. 57 Net Interest Expense $ 9,355,222 COLLIER COUNTY, FLORIDA NOTES TO THE FINANCIAL STATEMENTS SEPTEMBER 30, 2010 NOTE 6 - LONG -TERM DEBT — CONTINUED LEASE OBLIGATIONS Capitalized leases payable at September 30, 2010 amounted to $1,075,442. These obligations, which are collateralized by equipment and vehicles, have annual installments ranging from $35,231 to $131,773 including interest ranging from 4.26% to 7.21% and mature through 2015. As of year end, equipment leased under capital leases in the Government Activities had a historical cost of $1,341,358 and accumulated depreciation of $1,238,342. Equipment leased under capital leases in the Business - type Activities had a historical cost of $1,147,591 and accumulated depreciation of $372,339. Future minimum capital lease obligations as of September 30, 2010 were as follows: NOTE 7 - CONDUIT DEBT OBLIGATIONS COMPONENT UNIT CONDUIT DEBT The Industrial Development Authority, Housing Finance Authority, Health Facilities Authority and Educational Facilities Authority, all component units of Collier County, issue debt instruments for the purpose of providing capital financing to independent third parties. Industrial development revenue bonds have been issued to provide financial assistance to public entities for the acquisition and construction of industrial and commercial facilities. Housing revenue bonds have been issued for the purpose of financing the development of multi - family residential rental communities. The health facility revenue bonds were issued to provide financing for the construction of health park facilities. The educational facility revenue bonds were used to provide financing for the construction of educational facilities. These bonds were secured by the financed property, a letter of credit or a corporate guarantee. The primary revenues pledged to pay the debt are those revenues derived from the project or facilities constructed. Neither the issuer, nor the County, is obligated in any manner for repayment of the bonds and as such they are not reported as liabilities in the accompanying financial statements. 58 Governmental Business -type Activities Activities Total 2011 $ 190,660 $ 272,917 $ 463,577 2012 104,821 225,004 329,825 2013 77,920 140,406 218,326 2014 77,920 41,575 119,495 2015 35,231 - 35,231 Total minimum lease payments 486,552 679,902 1,166,454 Less amount representing interest (47,456) (43,556) (91,012) Present value of minimum lease payments $ 439,096 $ 636,346 $ 1,075,442 NOTE 7 - CONDUIT DEBT OBLIGATIONS COMPONENT UNIT CONDUIT DEBT The Industrial Development Authority, Housing Finance Authority, Health Facilities Authority and Educational Facilities Authority, all component units of Collier County, issue debt instruments for the purpose of providing capital financing to independent third parties. Industrial development revenue bonds have been issued to provide financial assistance to public entities for the acquisition and construction of industrial and commercial facilities. Housing revenue bonds have been issued for the purpose of financing the development of multi - family residential rental communities. The health facility revenue bonds were issued to provide financing for the construction of health park facilities. The educational facility revenue bonds were used to provide financing for the construction of educational facilities. These bonds were secured by the financed property, a letter of credit or a corporate guarantee. The primary revenues pledged to pay the debt are those revenues derived from the project or facilities constructed. Neither the issuer, nor the County, is obligated in any manner for repayment of the bonds and as such they are not reported as liabilities in the accompanying financial statements. 58 COLLIER COUNTY, FLORIDA NOTES TO THE FINANCIAL STATEMENTS SEPTEMBER 30, 2010 NOTE 7 - CONDUIT DEBT OBLIGATIONS — CONTINUED COMPONENT UNIT CONDUIT DEBT — CONTINUED As of September 30, 2010 the outstanding principal amount payable on all component unit conduit debt was $301,620,644 and is made up of the following: Industrial development revenue bonds $ 73,525,644 Housing finance revenue bonds 71,270,000 Health facilities revenue bonds 83,870,000 Educational facilities revenue bonds 72,955,000 Total $ 301,620,644 On October 15, 2009, an event of default occurred on $2,615,000 of outstanding industrial development revenue bonds. Pursuant to the terms of the trust indenture the maturity of the bonds was accelerated and a line of credit was drawn upon as of October 20, 2009 to pay all remaining principal and interest on the bonds. All bondholders were paid in full and neither the County nor the issuer is obligated in any manner. NOTE 8 - DEFEASED DEBT The County has defeased certain outstanding bonds by placing the proceeds of new bonds in irrevocable trusts to provide for all future debt service payments on the defeased debt. Accordingly, the trust accounts and the defeased bonds are not included in the County's financial statements. At September 30, 2010 the following issues were considered defeased: Governmental Activities 1986 Capital Improvement Program Revenue Bonds, Sub - Series 5 Mode A 2003 Capital Improvement and Refunding Revenue Bonds Total Governmental Activities Defeased Debt Original Debt Defeased $ 12,245,000 Defeased Bonds Outstanding $ 3,575,000 4,360,000 4,065,000 $ 16,605,000 $ 7,640,000 Original Debt Defeased Bonds Business -type Activities Defeased Outstanding 1983 County Water and Sewer District Refunding Bonds $ 22,000,000 $ 3,670,000 On October 8, 2009 the Collier County Water and Sewer District issued the $11,727,489 Collier County Water -Sewer District Water and Sewer Refunding Revenue Bond, Series 2009 for purposes of currently refunding all of the outstanding Collier County Water and Sewer District's Series 1999B bonds. The bonds were issued on parity with existing County Water and Sewer debt and pay a fixed rate of interest of 2.97% through their maturity on July 1, 2016. The current refunding achieved a net present value savings of 5.32% on the refunded bonds. 59 COLLIER COUNTY, FLORIDA NOTES TO THE FINANCIAL STATEMENTS SEPTEMBER 30, 2010 NOTE 9 — PENSION PLAN OBLIGATIONS RETIREMENT PLAN Substantially all full time and part time employees of the County are eligible to participate in the State of Florida Retirement System (the System), a cost sharing, multiple employer program administered by the State of Florida, Division of Retirement. The System provides two retirement plans from which eligible employees can choose: the Pension Plan (defined benefit) and the Investment Plan (defined contribution). The County follows the provisions of GASB 27, Accounting for Pensions by State and Local Governmental Employers, as described in the following disclosure. PLAN DESCRIPTION Employees who are regular risk members and retire at or after age 62 with 6 years of credited service, or with 30 years of service regardless of age, are entitled to a retirement benefit, payable monthly for life, equal to 1.6 percent of their average final compensation for each year of credited service. Final average compensation is the employee's average of the five highest years of salary earned during credited service. Vested employees may retire before age 62 and receive benefits that are reduced 5 percent for each year prior to normal retirement age or date. The System also provides death and disability benefits as well as annual cost -of- living adjustments to plan participants and beneficiaries. The Florida Legislature established the System under Chapter 121, Florida Statutes and has sole authority to amend benefit provisions. Special Risk Class members qualify for normal retirement with 6 years of special risk service and age 55 or with 25 years of special risk service at any age. The monthly benefit payable is equal to 2 -3 percent of their average final compensation for each year depending on the percent in effect during the service period. Vested employees may retire before age 55 and receive benefits that are reduced 5 percent for each year prior to normal retirement age or date. The Deferred Retirement Option Program (DROP) is a program that provides an alternative method for payment of retirement benefits for a specified and limited period for members of the System, effective July 1, 1998. Under this program, the employee may retire and have their benefits accumulate in the Florida Retirement System Trust Fund, earning interest, while continuing to work for a System employer. The act of participating in the program does not change the individual employee's employment conditions. When the DROP period ends, a maximum of 60 months, employment must be terminated. At the time of termination of employment, the employee will receive payment of the accumulated DROP benefits, and begin receiving their monthly retirement benefit (in the same amount determined at retirement, plus annual cost -of- living increases). The System publishes an annual report that provides ten -year historical trend information regarding progress made in accumulating sufficient assets to pay benefits when due. The report may be obtained by writing the Division of Retirement, Research, Education and Policy Section, 1317 Winewood Boulevard, Tallahassee, Florida 32315 -9000, or by calling (866) 738 -2366, or accessing their internet site at www.dms.mVfiorida.com. m COLLIER COUNTY, FLORIDA NOTES TO THE FINANCIAL STATEMENTS SEPTEMBER 30, 2010 NOTE 9 — PENSION PLAN OBLIGATIONS - CONTINUED FUNDING POLICY The System is non - contributory for employees and the County is required to contribute at an actuarially determined rate. The current rate is 23.25% for special risk employees, 18.64% for county elected officials, 10.77% for regular employees, 14.57% for senior management and 12.25% for DROP employees of annual covered payroll. The contributions of the County are established by the State Legislature and therefore subject to amendment. The County's contributions to the System for the years ending September 30, 2010, 2009 and 2008 are represented in the table below. The Count's contributions were equal to the required contributions for each year. General Fund Community Redevelopment Nonmajor Governmental Funds County Water and Sewer Solid Waste Disposal Nonmajor Enterprise Funds Internal Service Funds Totals NOTE 10— TRANSFERS FY -2010 FY -2009 FY -2008 $ 18,772,784 $ 18,878,678 $ 18,842,653 49,919 48,712 24,511 7,105,137 4,648,503 4,995,385 1,640,191 1,574,521 1,549, 255 119,386 113,447 103,541 2,637,057 2,570,903 2,489,566 487,388 217,901 204,365 $ 30,811,862 $ 28,052,665 $ 28,209,276 Transfers for the year ended September 30, 2010 were as follows: Transfers from Fund Transfers to Fund Amount Governmental Activities: General Fund 532,172 General Fund Nonmajor Governmental Funds $ 38,931,614 Nonmajor Business -type County Water and Sewer 4,965 Solid Waste Disposal 44,868 Internal Service Fund Nonmajor Business -type 13,579,300 Government Facilities Impact Fee Nonmajor Governmental Funds 5,440,659 Community Redevelopment Nonmajor Governmental Funds 1,632,944 Nonmajor Governmental Funds General Fund 3,244,187 Community Redevelopment 383,961 Nonmajor Governmental Funds 49,811,753 County Water and Sewer 52,700 Nonmajor Business -type 1,778,000 Business -type Activities: County Water and Sewer General Fund 3,712,984 Solid Waste Disposal General Fund 532,172 County Water and Sewer 1,405,500 Nonmajor Business -type Nonmajor Governmental Funds 3,000 County Water and Sewer 76,200 Internal Service Fund General Fund 1,700,000 Totals $ 122,334,807 61 COLLIER COUNTY, FLORIDA NOTES TO THE FINANCIAL STATEMENTS SEPTEMBER 30, 2010 NOTE 10 — TRANSFERS — CONTINUED Transfers between funds move unrestricted revenues collected in the General Fund to finance operating and capital programs accounted for in other funds in accordance with budgetary authorizations and to move receipts restricted to debt service from the funds collecting the receipts to the debt service fund as payments become due. NOTE 11— NET ASSETS /FUND BALANCES Net assets represent the difference between total assets and liabilities and are categorized as follows: Invested in capital assets, net of related debt: Total capital assets, net of debt issued in the acquisition of these assets and net of depreciation is reported separately in the net assets section. Restricted for growth related capital expansion: Impact fee and system development charges restricted for growth related capital expansion. Restricted for transportation capital projects: Gas taxes and other revenues restricted for transportation capital improvements. Restricted for Conservation Collier: One quarter mill of ad valorem revenues restricted for the purchase of environmentally sensitive land. Restricted for tourist development: Tourist development tax proceeds are restricted for tourist related activities. Restricted for debt service: Balances are restricted in conjunction with the issuance of bonds and have been funded by operating transfers from the appropriate funds. The use of monies in the sinking fund is restricted to the payment of principal and interest on long -term debt. Restricted for renewal and replacement: Balance is restricted in conjunction with the issuance of County Water and Sewer District Bonds. The use of monies in the renewal and replacement fund is restricted to funding the cost of additions, replacement or major repair of water and wastewater capital assets. Unrestricted: Balances are not restricted for specific purposes. The following categories are used to report governmental fund balances in the fund financial statements. Fund Balances Reserved /Unreserved Reserved for prepaid costs: Balances represent insurance, travel and other expenses paid in advance and which are not considered available and spendable resources. Reserved for inventory: Balances represent items not considered available and spendable resources. 62 COLLIER COUNTY, FLORIDA NOTES TO THE FINANCIAL STATEMENTS SEPTEMBER 30, 2010 NOTE 11— NET ASSETS /FUND BALANCES — CONTINUED Reserved for advances to other funds: Balances represent long -term advances made to other funds which do not constitute expendable and available financial resources. Reserved for encumbrances: Balances are segregated for expenditure upon vendor performance. Reserved for debt service: Balances represent monies legally restricted to the payment of principal and interest on long -term debt. Unreserved, reported in general fund: Balances in the general fund not reserved for specific purposes. Unreserved, reported in special revenue funds: Balances in the special revenue funds not reserved for specific purposes. Unreserved, reported in debt service funds: Balances in the debt service funds not reserved for specific purposes. Unreserved, reported in capital project funds: Balances in the capital project funds not reserved for specific purposes. NOTE 12 - RISK MANAGEMENT The County is exposed to various risks of loss related to tort; theft of, damage to and destruction of assets; errors and omissions; injuries to employees and natural disasters. A self- insurance internal service fund is maintained by the County to administer insurance activities relating to workers' compensation, health and property and casualty, which covers general, property, auto, public official and crime liabilities. The County self insurance program covers operations of the Board and the constitutional officers, except for the Sheriff. Under these programs, the self- insurance fund provides coverage up to a maximum amount for each claim. The County purchases commercial insurance for claims in excess of coverage provided by the self- insurance fund and for all other covered risks of loss. Claim Type County's Coverage Excess Carrier's Coverage Property and casualty claims $50,000 - $500,000 $50,000 - $125,000,000 (5% Named Storm) Auto liability claims $200,000 $200,000 - $1,000,000 Employee health claims $225,000 $225,000 - $2,000,000 Workers' compensation claims $500,000 $500,000 - $25,000,000 Settled claims have not exceeded the insurance provided by third party carriers in any of the past three years. All divisions of the County, excluding the Sheriff, participate in this program. Charges to operating departments are based upon amounts believed by management to meet the required annual payouts during the fiscal year and to pay for the estimated operating costs of the programs. For the fiscal year ended September 30, 2010 the operating departments were charged $31,455,308 for workers' compensation, health and property and casualty self- insurance programs. 63 COLLIER COUNTY, FLORIDA NOTES TO THE FINANCIAL STATEMENTS SEPTEMBER 30, 2010 NOTE 12 - RISK MANAGEMENT - CONTINUED The claims loss reserve for workers' compensation, health and property and casualty of $6,455,000 reported at September 30, 2010 was calculated by third party actuaries based upon GASB Statement 30, Risk Financing Omnibus, which requires that a liability for claims be reported when it is probable that a loss has been incurred and the amount of that loss can be reasonably estimated. The estimated liabilities for unpaid losses related to workers' compensation and property and casualty were discounted at 3.5 %. The estimated liabilities for unpaid losses related to health were not discounted as their turnover period is much shorter. Claims loss reserves of $3,393,417 are recorded as current liabilities. The Sheriff participates in the Statewide Florida Sheriff's Self- Insurance Fund for its professional liability insurance. The fund is managed by representatives of the participating Sheriff offices and provides professional liability insurance to participating Sheriff agencies. The Florida Sheriff's Self- Insurance Fund provides liability insurance coverage subject to the following limitations: $3,100,000 for any claim involving a single individual, $3,200,000 for any incident which involves multiple claims and aggregate, $5,000,000 ultimate net loss per Sheriff during any policy period. The Sheriff also participates in the Statewide Florida Sheriff's Self- Insurance Fund program for workers' compensation coverage. The Florida Sheriff's Association Workers' Compensation Insurance Trust (FSAWIT) is a limited self- insurance fund providing coverage for the first $500,000 of every claim. Re- insurance is provided through a third party insurer for all claims exceeding $500,000 up to $10,000,000 and an aggregate of $500,000 depending on type of bodily injury. Settled claims have not exceeded the insurance provided by third party carriers in any of the past three years. Premiums charged to participating Sheriffs are based upon amounts believed by Fund management to meet the estimated annual payouts during the fiscal year and to pay for the estimated operating costs of the program. All liabilities associated with these self- insured risks are reported in the basic financial statements of the Statewide Florida Sheriff's Self- Insurance Fund. The Sheriff cannot be additionally assessed for claims paid by the program. The Sheriff has also established a self- funded employee health plan. An internal service fund is used to account for the activities of the plan. Excess coverage has been purchased which provides specific claim excess coverage for any one incident exceeding $175,000 up to $2,000,000. Payments to the internal service fund are based on actuarial estimates of amounts needed to pay prior year and current year claims. The claims loss reserve for health of $2,154,000 reported at September 30, 2010 was calculated by third party actuaries based upon GASB Statement 30, Risk Financing Omnibus which requires that a liability for claims be reported when it is probable that a loss has been incurred and the amount of that loss can be reasonably estimated. The entire Sheriffs health claim loss reserve is recorded as a current liability. 64 COLLIER COUNTY, FLORIDA NOTES TO THE FINANCIAL STATEMENTS SEPTEMBER 30, 2010 NOTE 12 - RISK MANAGEMENT - CONTINUED CHANGES IN SELF - INSURANCE CLAIMS PAYABLE Changes in the self- insurance claims payable for fiscal years 2009 and 2010 were as follows for the County and Sheriff self- insurance programs: NOTE 13 —OTHER POSTEMPLOYMENT BENEFITS Plan Description - The Board and the Tax Collector administer a single - employer defined benefit plan (OPEB Plan) and can amend the benefit provisions. The Board offers an OPEB Plan that subsidizes the cost of health care for its retirees who have at least 60% of eligible accrued sick leave remaining at the time of retirement and have completed 15 years of continuous service with the Board. In addition, the retiree must retire from the County, be at least 55 years of age or have completed 30 years of service under the Florida Retirement System (FRS) and be eligible to receive an FRS benefit with no break in time. Such employees are eligible to receive a 50% to 100% subsidy toward the cost of coverage under the active plan. The Tax Collector offers an OPEB plan that subsidizes 100% the cost of health care for employees with 10 years of service, between the ages of 54 and 64 and who exchange 800 hours of sick leave at retirement. Additionally, in accordance with Florida Statute 112.0801, County employees who retire and immediately begin receiving benefits from the FRS have the option of paying premiums to continue in the County's health insurance plan at the same group rate as for active employees. The plan does not issue a publicly available financial report. In 2010 Board employees meeting certain eligibility requirements were offered access to a Voluntary Separation Incentive Program (VSIP). The requirements for eligibility were that the employee had to be eligible to retire without penalty under FRS. Eligible employees had three options under VSIP. Option 1: Medical and dental coverage for a period of three years, with employee enrollment in the plans as of the date the election is made. If the employee has waived coverage, the employee will be enrolled in the $500 deductible medical plan and basic dental plan at the single coverage level. The Board will cover costs including both the employer and employee portions of the medical and dental premiums during the coverage period. 65 Property and Group Workers' Casualty Health Compensation Total Balance at September 30, 2008 $ 2,230,000 $ 5,206,000 $ 2,850,000 $ 10,286,000 Current year claims incurred and changes in estimates 1,226,571 38,918,275 378,061 40,522,907 Claim payments (1,425,571) (38,850,275) (1,204,061) (41,479,907) Balance at September 30, 2009 2,031,000 5,274,000 2,024,000 9,329,000 Current year claims incurred and changes in estimates 303,958 43,710,123 318,880 44,332,961 Claim payments (955,958) (43,583,123) (513,880) (45,052,961) Balance at September 30, 2010 $ 1,379,000 $ 5,401,000 $ 1,829,000 $ 8,609,000 NOTE 13 —OTHER POSTEMPLOYMENT BENEFITS Plan Description - The Board and the Tax Collector administer a single - employer defined benefit plan (OPEB Plan) and can amend the benefit provisions. The Board offers an OPEB Plan that subsidizes the cost of health care for its retirees who have at least 60% of eligible accrued sick leave remaining at the time of retirement and have completed 15 years of continuous service with the Board. In addition, the retiree must retire from the County, be at least 55 years of age or have completed 30 years of service under the Florida Retirement System (FRS) and be eligible to receive an FRS benefit with no break in time. Such employees are eligible to receive a 50% to 100% subsidy toward the cost of coverage under the active plan. The Tax Collector offers an OPEB plan that subsidizes 100% the cost of health care for employees with 10 years of service, between the ages of 54 and 64 and who exchange 800 hours of sick leave at retirement. Additionally, in accordance with Florida Statute 112.0801, County employees who retire and immediately begin receiving benefits from the FRS have the option of paying premiums to continue in the County's health insurance plan at the same group rate as for active employees. The plan does not issue a publicly available financial report. In 2010 Board employees meeting certain eligibility requirements were offered access to a Voluntary Separation Incentive Program (VSIP). The requirements for eligibility were that the employee had to be eligible to retire without penalty under FRS. Eligible employees had three options under VSIP. Option 1: Medical and dental coverage for a period of three years, with employee enrollment in the plans as of the date the election is made. If the employee has waived coverage, the employee will be enrolled in the $500 deductible medical plan and basic dental plan at the single coverage level. The Board will cover costs including both the employer and employee portions of the medical and dental premiums during the coverage period. 65 COLLIER COUNTY, FLORIDA NOTES TO THE FINANCIAL STATEMENTS SEPTEMBER 30, 2010 NOTE 13 — OTHER POSTEMPLOYMENT BENEFITS - CONTINUED Option 2: Employee receives a cash incentive in lieu of three years of medical and dental benefits. The employee will receive a cash payment equivalent to 50% of the average value of three years' medical and dental plan premiums, less applicable payroll taxes. Option 3: Employee receives medical and dental benefits until they reach age 65 with a cash incentive for remaining months under the plan. The employee is enrolled in the plans as of the date the election is made. If the employee has waived coverage, the employee will be enrolled in the $500 deductible medical plan and basic dental plan at the single coverage level. The Board will cover costs including both the employer and employee portions of the medical and dental premiums during the coverage period. As of the first of the month following the date when an employee reaches age 65, the employee will be entitled to receive a one -time cash payment equivalent to 50% of the average monthly value of the medical and dental plan premiums, less applicable payroll taxes, for the remaining months in which the employee is eligible to participate under the plan. At September 30, 2010, the date of the latest actuarial valuation, County plan participation consisted of: OPEB plan participants 2,261 Retirees receiving benefits 118 Funding Policy - The County has the authority to establish and amend funding policy. For the year ended September 30, 2010, the County contributed $719,310 to the OPEB Plan. No trust or agency fund has been established for the plan. Annual OPEB Cost and Net OPEB Obligation - The annual cost of the County's OPEB Plan is calculated based on the Annual Required Contribution (ARC), an amount actuarially determined in accordance with the parameters of GASB Statement No. 45. The ARC represents a level of funding that, if paid on an ongoing basis, is projected to cover the normal cost each year and amortize any unfunded actuarial liability over a period not to exceed 30 years. The following table shows the components of the County's annual OPEB Plan cost for the year, the amount actually contributed, and the changes in the net OPEB Plan obligation. Annual required contribution (ARC) Interest on net OPEB obligation Adjustment to ARC Annual OPEB cost Contributions made Decrease in net OPEB obligation Net OPEB obligation - beginning of year Net OPEB obligation - end of year Fiscal Year Fiscal Year Fiscal Year 2010 2009 2008 $ 661,962 $ 661,962 $ 514,423 10,651 6,839 - (17,585) (11,293) - 655,028 657,508 514,423 (719,310) (658,599) (158,312) (64,282) (1,091) 356,111 355,020 356,111 - $ 290,738 $ 355,020 $ 356,111 66 COLLIER COUNTY, FLORIDA NOTES TO THE FINANCIAL STATEMENTS SEPTEMBER 30, 2010 NOTE 13 — OTHER POSTEMPLOYMENT BENEFITS - CONTINUED Funded Status and Funding Progress - The contributions made for the 2010 fiscal year were 110% of the annual OPEB cost. As of the September 30, 2009 actuarial valuation date the OPEB Plan was 0.0% funded and the actuarial accrued liability for benefits was $5,814,470, and the actuarial value of plan assets was $0, resulting in an unfunded actuarial accrued liability (UAAL) of $5,814,470. As of the September 30, 2010 actuarial valuation date the OPEB Plan was 0.0% funded and the actuarial accrued liability for benefits was $5,825,874, and the actuarial value of plan assets was $0, resulting in a UAAL of $5,825,874. The covered payroll (annual payroll of active employees covered by the OPEB Plan) was $159.3 million, and the ratio of the UAAL to the covered payroll was 3.7 %. Actuarial Methods and Assumptions - Actuarial valuations of an ongoing plan involve estimates of the value of reported amounts and assumptions about the probability of occurrence of events far into the future. Examples include assumptions about future employment, mortality, and the healthcare cost trend. Amounts determined regarding the funded status of the plan and the annual required contributions of the employer are subject to continual revision as actual results are compared with past expectations and new estimates are made about the future. Calculations for financial reporting purposes are based on the benefits provided under terms of the plan as understood by the employer and the plan members in effect at the time of each valuation and on the pattern of sharing of costs between the employer and plan members to that point. The projection of benefits for financial reporting purposes does not explicitly incorporate the potential effects of legal or contractual funding limitations on the pattern of cost sharing between the employer and plan members in the future. Actuarial calculations reflect a long -term perspective. Consistent with that perspective, actuarial methods and assumptions used include techniques that are designed to reduce the effects of short -term volatility in actuarial accrued liabilities and the actuarial value of assets. The actuarial methods and assumptions are: Actuarial cost method Amortization method Amortization period Investment rate of return Discount rate Healthcare cost trend rate Projected Unit Credit Actuarial Cost Level Dollar Amount 30 years, Closed 3% 3% 8% for the 2011 fiscal year grading to an ultimate rate of 5% for the 2017 fiscal year Plan Description - The Sheriff administers a single - employer defined benefit plan (OPEB Plan) and can amend the benefit provisions. The Sheriff offers an OPEB Plan that subsidizes the cost of health care for its retirees who have 6 years of creditable service with the Sheriff and who receive a monthly retirement benefit from the Florida Retirement System. The Sheriff subsidizes approximately 20% for single coverage and 21% for family coverage for qualifying individuals. Additionally, in accordance with Florida Statute 112.0801, Sheriffs employees who retire and immediately begin receiving benefits from the FRS have the option of paying premiums to continue in the Sheriffs health insurance plan at the same group rate as for active employees. The plan does not issue a publicly available financial report. 67 COLLIER COUNTY, FLORIDA NOTES TO THE FINANCIAL STATEMENTS SEPTEMBER 30, 2010 NOTE 13 — OTHER POSTEMPLOYMENT BENEFITS - CONTINUED In 2010, employees meeting certain eligibility requirements were offered an Early Voluntary Separation Program. Eligibility requirements were that the employee had to be eligible to retire without penalty under FRS or have 20 years of service with the Sheriff's Office, have a specified base salary and meet the requirements for retirement in good standing. In addition, employees had to meet the eligibility requirements prior to May 17, 2010 and retire no later than September 30, 2010. Eligible employees had the following options: Option 1: Medical coverage for a period of 30 months at no more than the current coverage level. If the employee had waived coverage, he /she would be eligible for single coverage. Option 2: A one -time payment of 50% of the value of medical coverage in lieu of 30 months of coverage. Option 3: A combination of insurance coverage and a cash payment. Employee could then supplement with the conversion of 100% of accumulated sick leave to additional coverage beyond the 30 month period. At September 30, 2010, the date of the latest actuarial valuation, Sheriff plan participation consisted of: OPEB plan participants 1,188 Retirees receiving benefits 99 Funding Policy - The Sheriff has the authority to establish and amend funding policy. For the year ended September 30, 2010, the Sheriff contributed $985,790 to the OPEB Plan. No trust or agency fund has been established for the plan. Annual OPEB Cost and Net OPEB Obligation - The annual cost of the Sheriff's OPEB Plan is calculated based on the Annual Required Contribution (ARC), an amount actuarially determined in accordance with the parameters of GASB Statement No. 45. The ARC represents a level of funding that, if paid on an ongoing basis, is projected to cover the normal cost each year and amortize any unfunded actuarial liability over a period not to exceed 30 years. The following table shows the components of the Sheriff's annual OPEB Plan cost for the year, the amount actually contributed, and the changes in the net OPEB Plan obligation. Annual required contribution (ARC) Interest on net OPEB obligation Adjustment to ARC Annual OPEB cost Contributions made Increase in net OPEB obligation Net OPEB obligation - beginning of year Net OPEB obligation - end of year Fiscal Year Fiscal Year Fiscal Year 2010 2009 2008 $ 1,108,742 $ 1,363,461 $ 1,019,866 30,794 16,496 - (50,844) (27,236) - 1,088,692 1,352,721 1,019,866 (985,790) (876,138) (469,998) 102,902 476,583 549,868 1,026,451 549,868 - $ 1,129,353 $ 1,026,451 $ 549,868 M. COLLIER COUNTY, FLORIDA NOTES TO THE FINANCIAL STATEMENTS SEPTEMBER 30, 2010 NOTE 13 — OTHER POSTEMPLOYMENT BENEFITS - CONTINUED Funded Status and Funding Progress - The contributions made for the 2010 fiscal year were 91% of the annual OPEB cost. As of the September 30, 2009 actuarial valuation date, the OPEB Plan was 0.0% funded, the actuarial accrued liability for benefits was $14,171,709, and the actuarial value of assets was $0, resulting in an unfunded actuarial accrued liability (UAAL) of $14,171,709. As of the September 30, 2010 actuarial valuation date, the OPEB Plan was 0.0% funded, the actuarial accrued liability for benefits was $12,148,033, and the actuarial value of assets was $0, resulting in a UAAL of $12,148,033. The covered payroll (annual payroll of active employees covered by the OPEB Plan) was $117.9 million, and the ratio of the UAAL to the covered payroll was 10.3 %. Actuarial Methods and Assumptions - Actuarial valuations of an ongoing plan involve estimates of the value of reported amounts and assumptions about the probability of occurrence of events far into the future. Examples include assumptions about future employment, mortality, and the healthcare cost trend. Amounts determined regarding the funded status of the plan and the annual required contributions of the employer are subject to continual revision as actual results are compared with past expectations and new estimates are made about the future. Calculations for financial reporting purposes are based on the benefits provided under terms of the plan as understood by the employer and the plan members in effect at the time of each valuation and on the pattern of sharing of costs between the employer and plan members to that point. The projection of benefits for financial reporting purposes does not explicitly incorporate the potential effects of legal or contractual funding limitations on the pattern of cost sharing between the employer and plan members in the future. Actuarial calculations reflect a long -term perspective. Consistent with that perspective, actuarial methods and assumptions used include techniques that are designed to reduce the effects of short -term volatility in actuarial accrued liabilities and the actuarial value of assets. The actuarial methods and assumptions are: Actuarial cost method Amortization method Amortization period Investment rate of return Discount rate Healthcare cost trend rate Projected Unit Credit Actuarial Cost Level Dollar Amount 30 years, Closed 3% 3% 10% for the 2011 fiscal year grading to an ultimate rate of 5% for the 2021 fiscal year %11 COLLIER COUNTY, FLORIDA NOTES TO THE FINANCIAL STATEMENTS SEPTEMBER 30, 2010 NOTE 14— LANDFILL LIABILITY On May 1, 1995 the County entered into a landfill operating agreement with a third party for the privatization of the County's landfill operations. Under the contract, the third party is responsible for the daily operations, capital improvements, closure, postclosure and financial assurance requirements of the active cells within the Naples and Immokalee landfill sites. Collier County is responsible for the postclosure costs relating to portions of the Naples and Immokalee landfill sites. None of the cells that Collier County is responsible for has accepted waste since December 1989. The County is also responsible for staffing and operating the scale house at each site. In accordance with U.S. Environmental Protection Agency rule Solid Waste Disposal and Facility Criteria and GASB Statement 18, Accounting for Municipal Solid Waste Landfill Closure and Postclosure Care Costs, a liability has been established representing amounts estimated to be spent on postclosure relating to cells for which Collier County is responsible. The County's estimated liability in connection with the landfills is included in the proprietary funds statement of net assets. The landfill liability will be reassessed on an annual basis, and any increase due to inflation, changes in technology or additional postclosure care requirements will be recorded as a current cost. The County has funded an escrow account with Fifth Third Bank in the amount of $11,503, as of September 30, 2010, to comply with Rule 62- 701.630, Florida Administrative Code for the inactive Eustis Avenue Landfill site. These funds bear interest and are restricted for the exclusive use of the Eustis Avenue Landfill site's long -term care. There were no deposits, other than interest, or withdrawals from this account in fiscal year 2010. NOTE 15 - SIGNIFICANT CONTINGENCIES LITIGATION The County is involved as defendant or plaintiff in certain litigation and claims arising in the ordinary course of operations. In the opinion of County legal counsel, the range of potential recoveries or liabilities will not materially affect the financial position of the County. Litigation between the Clerk of the Circuit Court and the Board of County Commissioners regarding the role of the Clerk of the Circuit Court as County Auditor ended on November 10, 2010 when the Florida Supreme Court dismissed the appeal filed by the Board of County Commissioners. STATE AND FEDERAL GRANTS Grant monies received and disbursed by the County are for specific purposes and are subject to review by the grantor agencies. Such audits may result in requests for reimbursement due to disallowed expenditures. Based upon prior experience, the County does not believe that such disallowances, if any, would have a material effect on the financial position of the County. ARBITRAGE REBATE In accordance with the Tax Reform Act of 1986, any interest earnings on borrowed construction funds in excess of the interest costs incurred are required to be rebated to the federal government. There was no arbitrage rebate liability as of September 30, 2010. 70 COLLIER COUNTY, FLORIDA NOTES TO THE FINANCIAL STATEMENTS SEPTEMBER 30, 2010 NOTE 16 - SIGNIFICANT COMMITMENTS CONSTRUCTION COMMITMENTS Collier County has active construction projects as of September 30, 2010. The projects include road construction, governmental facilities and utilities improvements. At year end the County's commitments with contractors includes the following: NOTE 17 —FUND DEFICITS The following funds had fund balance deficits at September 30, 2010: Fund Amount Future $ (12,497,194) Category Commitments Governmental Activities: (807,436) Emergency Medical Service Impact Fee General Fund Natural resource planning $ 1,415,246 Government Facilities Impact Fee Buildings 1,235,946 Community Redevelopment Economic development 480,165 Other Governmental Funds Beach restoration 585,726 Buildings 867,848 Parks 1,469,912 Roads 45,692,222 Stormwater drainage 4,002,373 Business -type Activities: Water and Sewer Utilities 18,847,522 Solid Waste Disposal Landfill expansion 469,659 Nonmajor Enterprise Funds Mass Transit 179,656 Airports 217,104 Total $ 75,463,379 NOTE 17 —FUND DEFICITS The following funds had fund balance deficits at September 30, 2010: Fund Amount Government Facilities Impact Fee $ (12,497,194) County -Wide Library Impact Fee (5,585,777) Correctional Facilities Impact Fee (807,436) Emergency Medical Service Impact Fee (1,254,875) Law Enforcement Impact Fee (10,475,567) Total $ (30,620,849) The fund balance deficits are primarily the result of advances from other funds made prior to September 30, 2010. These advances were recorded to ensure repayment of non - impact fee monies loaned to the impact fee fund for the construction of growth necessitated facilities. County management anticipates that the deficits will be covered by future years' impact fee revenues. 71 COLLIER COUNTY, FLORIDA NOTES TO THE FINANCIAL STATEMENTS SEPTEMBER 30, 2010 NOTE 18 — IMPAIRMENT OF CAPITAL ASSET The Collier County Water -Sewer District has recorded an impairment of the value of its South Reverse Osmosis Raw Water Wellfield due to the failure of a raw water transmission pipeline. The pipeline was less than one year into its service life at the time of the failure. As a result of this pipeline failure, the Water -Sewer District lost the raw water supply from twenty -three wells. The estimated cost of restoring the wellfield was used to calculate the value of the impairment. The resulting loss of $9,247,207 was charged to the Water -Sewer District's Statement of Revenues, Expenses and Changes in Fund Net Assets as a non - operating expense and to the government wide Statement of Activities as a program expense. The remaining net book value of the wellfield as of September 30, 2010 was $46,325,641. The asset is currently idle, but the County Water -Sewer District expects to have the wellfield completely restored during fiscal year 2012. On November 19, 2010, the Water -Sewer District, through outside counsel, filed suit against the project's contractor and surety. Damages sought in this action are currently estimated at $9,000,000. NOTE 19 — SUBSEQUENT EVENTS On November 30, 2010 Collier County issued the Series 2010B Special Obligation Refunding Revenue Bonds in the par amount of $24,620,000. These bonds were issued for the purpose of advance refunding all of the County's outstanding Capital Improvement Revenue Bonds, Series 2002. The final maturity of the bonds is October 1, 2021, with interest rates of 3.00% to 5.00 %. The refunding achieved a net present value savings of 5.41% on the refunded bonds. The refinancing of the Series 2002 Bonds, and their attendant restrictive covenants, caused the required cash reserve surety replacement relating to the Series 2002, 2003 and 2005 bonds to decrease from $19,570,777 to $15,717,300, or $3,853,477. 72 REQUIRED SUPPLEMENTARY INFORMATION Required Supplementary Information Collier County, Florida Schedule of Funding Progress for the Retiree Health Plan 74 Actuarial Accrued UAAL as a Actuarial Actuarial Liability(AAL) - Percentage of Valuation Value of Unit Credit Unfunded Funded Covered Covered Agency Date Assets Actuarial Cost AAL (UAAL) Ratio Payroll Payroll Board and Constitutionals 10/1/2009 - 5,814,470 5,814,470 0.0% 164,923,591 3.5% (Non - Sheriff) Board and Constitutionals 10/1/2010 - 5,825,874 5,825,874 0.0% 159,321,900 3.7% (Non - Sheriff) Sheriff 10/1/2009 - 14,171,709 14,171,709 0.0% 123,296,677 11.5% Sheriff 10/1/2010 - 12,148,033 12,148,033 0.0% 117,879,632 10.3% 74 COMBINING AND INDIVIDUAL FUND FINANCIAL STATEMENTS THIS PAGE INTENTIONALLY LEFT BLANK Nonmajor Governmental Funds Special Revenue Funds ROAD DISTRICTS – To account for taxes levied and expenditures to carry on all work on roads and bridges in the County except that provided for in capital project funds. UNINCORPORATED AREA MUNICIPAL SERVICES TAXING DISTRICT – To account for revenues derived from and expanded for the benefit of the unincorporated areas of the County. COMMUNITY DEVELOPMENT –To account for building permit and development fees to support licensing, permitting and inspection services. WATER MANAGEMENT AND POLLUTION CONTROL – To account for taxes levied County -wide to provide water resource management and water pollution control. GRANTS AND SHARED REVENUES— To account for the revenues received from federal, state and local grants. IMPROVEMENT DISTRICTS – To account for taxes levied within municipal service taxing districts to provide for specified improvements and /or the maintenance of such improvements. control. –To account for taxes levied within municipal service taxing districts for fire prevention and –To account for taxes levied within municipal service taxing district for street lighting. 911 ENHANCEMENT FEE – To account for fees levied on each telephone access line in the County for the enhancement of the 911 emergency telephone system. PUBLIC RECORDS MODERNIZATION – To account for the statutory surcharge on recording documents to be paid to the Clerk of the Circuit Court for the modernization of the Clerk's official records management system. TOURIST DEVELOPMENT –To account for the 4% tourist development tax. STATE HOUSING INITIATIVE PARTNERSHIP – To account for state revenues received to provide affordable residential housing for very low to moderate income persons and those who have special housing needs. 800 MHZ INTERGOVERNMENTAL RADIO COMMUNICATIONS PROGRAM FUND – To account for moving traffic violation surcharges received to fund the County's intergovernmental radio communications program. ATION –To account for County monies used to fund the operation of the court system. – To account for the accumulation and expenditure of proceeds from the sale of property confiscated by the Sheriff. GAC LAND SALES, ROADS AND CANALS – To account for principal and settlement fees received from a 1977 settlement with GAC Properties, Inc., and interest thereon to be expended for the restoration and maintenance of roads, facilities and drainage improvements in the Golden Gate Estates area. UTILITY FEE – To account for fees to be used to effectively and efficiently regulate private water and wastewater utilities operating within the unincorporated areas of Collier County and the City of Marco Island. –To account for the acquisition and management of environmentally sensitive lands. IMPACT FEE ESCROW – To account for impact fees relating to certain projects under construction until permits are issued. COURT INFORMATION TECHNOLOGY – To account for the accumulation of resources to enhance and increase access to court information. COURT SERVICES – To account for the accumulation of revenues associated with the function of the local court system. UNIVERSITY EXTENSION — To account for fund accumulation to meet the educational goals of the Collier County OF /IFAS extension. COURT FACILITIES FEE —To account for the accumulation of resources to improve court facilities. AFFORDABLE HOUSING —To account for fees to be used to provide for affordable housing related projects. OTHER SPECIAL REVENUE FUNDS —To account for the accumulation of resources for the following programs: Miscellaneous Florida Statutes Fee Collections Adoption Awareness Teen Court Animal Control Public Library Law Library Inmate Welfare County Drug Abuse Law Enforcement Training Debt Service Funds Euclid and Lakeland Assessment Legal Aid Society Federal Equitable Sharing Domestic Violence Juvenile Assessment Center Driver Education Crime Prevention Freedom Memorial GAS TAX REVENUE BONDS —To account for the accumulation of resources and payments of interest and principal on the Series 2003 and 2005 Gas Tax Bonds. CAPITAL IMPROVEMENT REVENUE BONDS — To account for the accumulation of resources, surety reserve and payment of interest and principal on the Series 2002, 2003 and 2005 Bonds. POOLED COMMERCIAL PAPER PROGRAM — To account for the accumulation of resources and payment of interest and principal on the variable rate commercial paper loan program. CARIBBEAN GARDENS LOAN — To account for the accumulation of resources and payment of interest and principal on the variable rate commercial paper incurred in the acquisition of Caribbean Gardens. STORMWATER IMPROVEMENT ASSESSMENT BONDS — To account for the accumulation of resources and payment of interest and principal on special assessment debt incurred in the Naples Park area. LIMITED GENERAL OBLIGATION BONDS. CONSERVATION COLLIER — To account for the accumulation of resources and payment of interest and principal on long -term debt incurred for the acquisition of environmentally sensitive lands. COMMUNITY REDEVELOPMENT TAXABLE NOTE — To account for the accumulation of resources and payment of interest and principal on taxable long -term debt incurred for the acquisition of land in the Bayshore /Gateway Community Redevelopment Agency. FOREST LAKES LIMITED GENERAL OBLIGATION BONDS —To account for the accumulation of resources and payment of interest and principal on long -term debt incurred on the Forest Lakes Limited General Obligation Bonds. SPECIAL OBLIGATION REVENUE BONDS — To account for the accumulation of resources and payment of interest and principal on long -term debt incurred in the refinancing of various outstanding variable rate commercial paper loans. Capital Project Funds COUNTY -WIDE CAPITAL IMPROVEMENTS — To account for capital projects, designated by the Board of County Commissioners, to be funded by a County-wide one third mil levy. PARKS IMPROVEMENTS — To account for the expenditure of funds raised specifically for improvements to parks. Projects include land acquisition, design, construction and equipping of certain Community Park sites in the unincorporated areas of the County. Primary funding is ad valorem taxes. COUNTY -WIDE LIBRARY IMPACT FEES — To account for the receipt and expenditure of library impact fees collected from all qualifying new construction. These impact fees must be used for acquisition of County -wide library facilities. CORRECTIONAL FACILITIES IMPACT FEES —To account for the receipt and expenditure of correctional facilities impact fees collected from all qualifying new construction. The impact fee must be used for the acquisition /construction of correctional facilities. EMERGENCY MEDICAL SERVICES IMPACT FEES — To account for the receipt and expenditure of emergency medical service impact fees collected from all qualifying new construction. The impact fees must be used for acquisition /construction of emergency service facilities. WATER MANAGEMENT — To account for the receipt and expenditure of funds raised specifically for water management purposes. Primary funding is ad valorem taxes. PARKS IMPACT DISTRICTS — To account for the receipt and expenditure of parks impact fees collected from all qualifying new construction. The impact fees must be used for the acquisition /construction of park facilities. ROAD IMPACT DISTRICTS — To account for the receipt and expenditure of road impact fees collected from all qualifying new construction. The impact fees must be used for the acquisition /construction of roads. ROAD CONSTRUCTION — To account for the receipt and expenditure of gas taxes. Projects include, but are not limited to, right -of -way acquisition, design and construction of various transportation improvements. LAW ENFORCEMENT IMPACT FEES — To account for the receipt and expenditure of law enforcement impact fees collected from all qualifying new construction. The impact fee must be used for the acquisition /construction of law enforcement related facilities. OTHER CAPITAL PROJECTS — To account for major capital expenditure financed from resources other than proceeds from the issuance of long -term debt and the one third mil levy. COLLIER COUNTY, FLORIDA COMBINING BALANCE SHEET NONMAIOR GOVERNMENTAL FUNDS SEPTEMBER 30, 2010 ASSETS Cash, cash equivalents and investments Receivables: Interest Trade, net Notes Special assessments Due from other funds Due from other governments Inventory Advances to other funds Prepaid costs Total assets LIABILITIES AND FUND BALANCES Liabilities: Accounts payable Wages payable Due to other funds Due to other governments Due to individuals Deferred revenues Refundable deposits Retainage payable Advances from other funds Total liabilities Fund balances (deficits): Reserved for: Encumbrances Inventory Advances to other funds Prepaid costs Debt service Unreserved, reported in: Special revenue funds Debt service funds Capital projects funds Total fund balances (deficits) Total liabilities and fund balances See accompanying independent auditor's report Special Revenue Funds Water Management Road Unincorporated Community and Pollution Districts Area MSTD Development Control $ 2,845,033 $ 11,413,773 $ 5,005,178 $ 3,071,093 6,293 18,254 6,319 4,505 21,279 222,836 74,527 426 4,301 360,494 48,997 175,396 762,552 - 43,023 $ 3,052,302 $ 12,777,909 $ 5,086,024 $ 3,168,044 770,272 1,436,325 22,367 119,867 463,468 566,490 343,219 120,791 28 11,287 8,583 - 73 2,589 682,451 - - - 4,620 - 425 66,785 - 1,400,000 1,233,841 2,017,116 2,528,025 240,658 13,685 373,992 11,335 99,575 1,804,776 10,386,801 2,546,664 2,827,811 1,818,461 10,760,793 2,557,999 2,927,386 $ 3,052,302 $ 12,777,909 $ 5,086,024 $ 3,168,044 01 Funds Grants and Fire 911 Public Shared Improvement Control Lighting Enhancement Records Revenues Districts Districts Districts Fee Modernization $ 5,551,684 $ 27,432,668 $ 1,196,579 $ 355,175 $ 4,018,195 $ 3,783,203 3,861 39,077 1,981 626 5,737 - 212,409 7,938 155 414 - - 225,333 - - - - - 28,960 38,996 37,331 7,910 - - 7,016,714 - 630 - 157,967 12 4,083,386 - - - - - $ 17,122,347 $ 27,518,679 $ 1,236,676 $ 364,125 $ 4,181,899 $ 3,783,215 1,797,271 734,972 9,057 37,740 - 34,043 108,804 21,642 102,425 4,619 - - 3,920,287 5,044 - - 135,901 - 3,221 - - - - - 1,636,301 - - - - - - 62,506 - - - - 7,465,884 824,164 111,482 42,359 135,901 34,043 5,726,957 2,165,686 184,672 4,083,386 - - (353,880) 24,528,829 940,522 321,766 4,045,998 3,749,172 9,656,463 26,694,515 1,125,194 321,766 4,045,998 3,749,172 $ 17,122,347 $ 27,518,679 $ 1,236,676 $ 364,125 $ 4,181,899 $ 3,783,215 (Continued) 81 COLLIER COUNTY, FLORIDA COMBINING BALANCE SHEET NONMAJOR GOVERNMENTAL FUNDS SEPTEMBER 30, 2010 Special Revenue Funds LIABILITIES AND FUND BALANCES Liabilities: Accounts payable Wages payable Due to other funds Due to other governments Due to individuals Deferred revenues Refundable deposits Retainage payable Advancesfrom other funds Total liabilities Fund balances (deficits): Reserved for: Encumbrances Inventory Advances to other funds Prepaid costs Debt service Unreserved, reported in: Special revenue funds Debt service funds Capital projects funds Total fund balances (deficits) Total liabilities and fund balances See accompanying independent auditor's report 1,070,956 13,746 91,677 915 246 3,297,274 14,782 8,780 - 88,027 1,163,548 3,311,266 14,782 96,807 1,208,649 83,255 37,073,898 751,184 110,617 171,116 38,282,547 834,439 110,617 171,116 $ 39,446,095 $ 4,145,705 $ 125,399 $ 267,923 82 State 800 Housing MHZ Tourist Initiative IRCP State Court Development Partnership Fund Administration ASSETS Cash, cash equivalents and investments $ 38,716,535 $ 2,825,749 $ 100,485 $ 119,471 Receivables: Interest 42,629 4,036 210 365 Trade, net 567,335 - 21,675 115,863 Notes - 1,315,920 - - Special assessments - - - Due from other funds 114,033 - - 32,224 Due from other governments 5,563 - 3,029 - Inventory - - - Advances to other funds - - - - Prepaid costs Totalassets $ 39,446,095 $ 4,145,705 $ 125,399 $ 267,923 LIABILITIES AND FUND BALANCES Liabilities: Accounts payable Wages payable Due to other funds Due to other governments Due to individuals Deferred revenues Refundable deposits Retainage payable Advancesfrom other funds Total liabilities Fund balances (deficits): Reserved for: Encumbrances Inventory Advances to other funds Prepaid costs Debt service Unreserved, reported in: Special revenue funds Debt service funds Capital projects funds Total fund balances (deficits) Total liabilities and fund balances See accompanying independent auditor's report 1,070,956 13,746 91,677 915 246 3,297,274 14,782 8,780 - 88,027 1,163,548 3,311,266 14,782 96,807 1,208,649 83,255 37,073,898 751,184 110,617 171,116 38,282,547 834,439 110,617 171,116 $ 39,446,095 $ 4,145,705 $ 125,399 $ 267,923 82 Special Revenue Funds GAC land Court Confiscated Sales, Roads Utility Conservation Impact Fee Information Property and Canals Fee Collier Escrow Technology $ 728,080 $ 1,480,382 $ 616,890 $ 23,155,905 $ 666,954 $ 425,173 1,019 2,054 847 31,374 1,244 788 - - 68,327 2,020 - 53,834 - - - 92,933 - - - 268,891 - - - - 686,064 $ 23,282,232 $ 668,198 $ 479,795 $ 729,099 $ 1,751,327 $ 686,064 $ 23,282,232 $ 668,198 $ 479,795 - 25 6,238 - 107,199 14,490 14,070 - - 268,891 - - - - - - - 13,132 - 268,891 14,515 20,308 13,132 107,199 156,369 729,099 1,482,436 671,549 23,105,555 655,066 372,596 729,099 1,482,436 671,549 23,261,924 655,066 372,596 $ 729,099 $ 1,751,327 $ 686,064 $ 23,282,232 $ 668,198 $ 479,795 (Continued) 83 COLLIER COUNTY, FLORIDA COMBINING BALANCE SHEET NONMAJOR GOVERNMENTAL FUNDS SEPTEMBER 30, 2010 ASSETS Cash, cash equivalents and investments Receivables: Interest Trade, net Notes Special assessments Due from other funds Due from other governments Inventory Advances to other funds Prepaid costs Total assets LIABILITIES AND FUND BALANCES Liabilities: Accounts payable Wages payable Due to other funds Due to other governments Due to individuals Deferred revenues Refundable deposits Retainage payable Advances from other funds Total liabilities Fund balances (deficits): Reserved for: Encumbrances Inventory Advances to other funds Prepaid costs Debt service Unreserved, reported in: Special revenue funds Debt service funds Capital projects funds Total fund balances (deficits) Total liabilities and fund balances See accompanying independent auditor's report Revenue Funds Court Court University Facilities Affordable Services Extension Fee Housing $ 783,629 $ 45,944 $ 2,045,383 $ 603,009 - 64 2,736 833 100 97,130 - 47,605 $ 831,234 $ 46,108 $ 2,145,249 $ 603,842 200,360 200,360 460,187 630,874 46,108 1,685,062 603,842 630,874 46,108 2,145,249 603,842 $ 831,234 $ 46,108 $ 2,145,249 $ 603,842 84 Special Revenue Funds Debt Service Funds Other Total 3,312 Capital Pooled 4,183,175 - 161 - - Special Special Gas Tax Improvement Commercial 5,202,466 - - - - Revenue Revenue Revenue Revenue Paper Caribbean Funds Funds Bonds Bonds Program Gardens Loan $ 4,756,464 $ 141,742,634 $ 3,831,310 $ 19,673,844 $ 206,728 $ 229,454 4,315 179,167 5,371 18 137 317 52,140 1,518,408 - - - 767 - 1,541,253 - - - - - 766,179 - - - 12,569 - 8,212,491 - - - - - 4,352,277 - - - - $ 4,812,919 $ 158,312,409 $ 3,836,681 $ 19,673,862 $ 206,865 $ 243,107 40,987 6,424,987 - - - - 3,312 1,943,034 - - - - 100,884 4,183,175 - 161 - - 120 688,454 - - - - - 4,620 - - - - - 5,202,466 - - - - - 80,342 - - - - - 62,506 - - - - 1,400,000 19,570,778 145,303 19,989,584 19,570,939 46,168 10,530,530 - 4,083,386 4,621,448 123, 708, 909 3,106,076 730,605 102,923 206,865 243,107 4,667,616 138,322,825 3,836,681 102,923 206,865 243,107 $ 4,812,919 $ 158,312,409 $ 3,836,681 $ 19,673,862 $ 206,865 $ 243,107 (Continued) 85 COLLIER COUNTY, FLORIDA COMBINING BALANCE SHEET NONMAJOR GOVERNMENTAL FUNDS SEPTEMBER 30, 2010 Cash, cash equivalents and investments Receivables: Interest Trade, net Notes Special assessments Due from other funds Due from other governments Inventory Advances to other funds Prepaid costs Totalassets LIABILITIES AND FUND BALANCES Liabilities: Accounts payable Wages payable Due to other funds Due to other governments Due to individuals Deferred revenues Refundable deposits Retainage payable Advances from other funds Total liabilities Fund balances (deficits): Reserved for: Encumbrances Inventory Advances to other funds Prepaid costs Debt service Unreserved, reported in: Special revenue funds Debt service funds Capital projects funds Total fund balances (deficits) Total liabilities and fund balances See accompanying independent auditor's report Debt Service Funds Stormwater Limited General 113,397 126,417 Improvement Obligalton Bonds Community Forest lakes Assessment Conservation Redevelopment Limited General Bond Collier Taxable Note Obligation Bonds $ 118,854 $ 284,455 $ 1,572,225 $ 120,652 305 1,654 2,172 167 1,511 193,056 - - - 1,006 82,960 - 5,598 $ 313,221 $ 370,580 $ 1,574,397 $ 126,417 191,740 191,740 1,461,000 - 121,481 370,580 113,397 126,417 121,481 370,580 1,574,397 126,417 $ 313,221 $ 370,580 $ 1,574,397 $ 126,417 86 Debt Service Funds Capital Projects Funds 3,013 3,013 417,426 281,040 14,272 161 55 - 191,740 - - 358,839 142,036 - - 19,805 12,727 - 131,756 19,570,778 9,715,125 2,408,700 3,013 19,765,692 437,231 293,822 10,088,236 2,682,492 - - 4,124,876 1,071,380 235,853 116,472 34,667,600 1,400,000 - - 4,567,076 - - - - 11,041 2,026,416 - - - - 4,447,220 9,925,324 (5,821,630) (923,908) 11,041 6,593,492 43,239,696 12,396,704 (5,585,777) (807,436) $ 14,054 $ 26,359,184 $ 43,676,927 $ 12,690,526 $ 4,502,459 $ 1,875,056 (Continued) 87 Total Special Debt County-Wide County-Wide Correctional Obligation Service Capital Parks Library Facilities Revenue Bonds Funds Improvements Improvements Impact Fees Impact Fees $ 13,849 $ 26,051,371 $ 8,995,109 $ 11,232,512 $ 3,931,705 $ 1,725,444 205 10,346 14,218 15,509 5,339 2,632 - 2,278 - 6,131 1,342 364 - - - - 358,839 142,036 - 193,056 - - - - - 102,133 - 36,374 - - - - - - 205,234 4,580 - - 34,667,600 1,400,000 - - $ 14,054 $ 26,359,184 $ 43,676,927 $ 12,690,526 $ 4,502,459 $ 1,875,056 3,013 3,013 417,426 281,040 14,272 161 55 - 191,740 - - 358,839 142,036 - - 19,805 12,727 - 131,756 19,570,778 9,715,125 2,408,700 3,013 19,765,692 437,231 293,822 10,088,236 2,682,492 - - 4,124,876 1,071,380 235,853 116,472 34,667,600 1,400,000 - - 4,567,076 - - - - 11,041 2,026,416 - - - - 4,447,220 9,925,324 (5,821,630) (923,908) 11,041 6,593,492 43,239,696 12,396,704 (5,585,777) (807,436) $ 14,054 $ 26,359,184 $ 43,676,927 $ 12,690,526 $ 4,502,459 $ 1,875,056 (Continued) 87 COLLIER COUNTY, FLORIDA COMBINING BALANCE SHEET NONMAJOR GOVERNMENTAL FUNDS SEPTEMBER 30, 2010 ASSETS Cash, cash equivalents and investments Receivables: Interest Trade, net Notes Special assessments Due from other funds Due from other governments Inventory Advances to other funds Prepaid costs Total assets LIABILITIES AND FUND BALANCES Liabilities: Accounts payable Wages payable Due to other funds Due to other governments Due to individuals Deferred revenues Refundable deposits Retainage payable Advances from other funds Total liabilities Fund balances (deficits): Reserved for: Encumbrances Inventory Advances to other funds Prepaid costs Debt service Unreserved, reported in: Special revenue funds Debt service funds Capital projects funds Total fund balances (deficits) Total liabilities and fund balances See accompanying independent auditor's report Capital Projects Funds Emergency 3,979,537 13,319,081 30,366,580 Medical 8,949,260 Parks Road Services Water Impact Impact Impact Fees Management Districts Districts $ 1,081,787 $ 11,442,245 S 14,188,169 $ 65,120,524 1,570 15,483 19,822 90,022 278 - 7,443 27,783 128,518 - 2,188,028 6,269,520 1,236 - 145,727 38,238 $ 1,213,389 $ 11,457,728 $ 16,549,189 $ 71,546,087 5,846 2,122,399 280,585 1,386,787 331 69 1,489 128,518 - 2,188,028 6,269,520 385,738 95,013 3,234,643 2,333,900 2,468,264 2,508,468 2,563,695 10,892,439 4,691 4,969,723 666,413 30,287,068 (1,259,566) 3,979,537 13,319,081 30,366,580 (1,254,875) 8,949,260 13,985,494 60,653,648 $ 1,213,389 $ 11,457,728 $ 16,549,189 $ 71,546,087 fI Capital Projects Funds $ 74,198,018 $ 3,315,568 $ 2,789,171 $ 243,814,118 $ 428,485,711 4,817,248 13,580 78,891 9,418,074 Total Total - Law Other Capital Nonmajor Road Enforcement Capital Projects Governmental Construction Impact Fees Projects Funds Funds - 89,555 - 9,176,496 14,570,702 - $ 67,817,914 $ 3,221,584 $ 2,743,452 $ 191,500,445 $ 359,294,450 94,480 4,220 3,939 267,234 456,747 1,895,092 209 706 1,939,348 3,460,034 - 89,555 - 9,176,496 10,717,749 - - 40,760 40,760 233,816 215,215 - 314 251,903 1,120,215 4,175,317 - - 4,570,332 12,782,823 - - - - 4,352,277 - - - 36,067,600 36,067,600 $ 74,198,018 $ 3,315,568 $ 2,789,171 $ 243,814,118 $ 428,485,711 4,817,248 13,580 78,891 9,418,074 15,846,074 129,918 - 35,742 165,660 2,108,694 - - - 1,944 4,185,280 - - - - 688,454 - - 4,620 - 89,555 - 9,176,496 14,570,702 - - - - 80,342 3,732,337 - - 7,612,019 7,674,525 13,688,000 28,145,725 49,116,503 8,679,503 13,791,135 114,633 54,519,918 94,275,194 17,221,904 173,246 1,109,518 59,981,144 70,511,674 - - - - 4,083,386 36,067,600 36,067,600 4,567,076 - - - - 123,708,909 - - - - 2,026,416 48,296,611 (10,648,813) 1,565,020 93,245,456 93,245,456 65,518,515 (10,475,567) 2,674,538 189,294,200 334,210,517 $ 74,198,018 $ 3,315,568 $ 2,789,171 $ 243,814,118 $ 428,485,711 99 COLLIER COUNTY, FLORIDA COMBINING STATEMENT OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCES NONMAIOR GOVERNMENTAL FUNDS FOR THE FISCAL YEAR ENDED SEPTEMBER 30, 2010 Special Revenue Funds Expenditures: Water Current: Management General government Road Unincorporated Community and Pollution Public safety Districts Area MSTD Development Control Revenues: - 915,598 229,661 2,957,293 Taxes $ - $ 36,564,249 $ - $ 1,984,456 Licenses, permits and impact fees 397,325 95,892 8,860,012 585 Intergovernmental 2,028,656 381,015 - 161,303 Charges for services 176,642 2,510,848 2,193,834 496,645 Fines and forfeitures - 343,283 1,000 - Interest income 26,822 164,742 32,235 32,659 Special assessments - 8,509 - 2,570,074 Miscellaneous 40,314 211,442 79,849 4,626 Total revenues 2,669,759 40,279,980 11,166,930 5,250,348 Expenditures: Current: General government - 5,736,351 3,580,100 - Public safety - 4,227,491 6,452,882 - Physical environment - 915,598 229,661 2,957,293 Transportation 19,447,710 10,181,581 - 1,526,846 Economic environment - 148,433 - Human services - - - - Culture and recreation - 10,472,041 - - Debt service: Principal - - - - Interest - - - Fiscal charges - - - - Capital outlay 303,263 1,157,122 7,733 319,297 Total expenditures 19,750,973 32,838,617 10,270,376 4,803,436 Excess (deficiency) of revenues over (under) expenditures (17,081,214) 7,4411363 896,554 446,912 Other financing sources (uses): Bonds issued - - - - Premiums on bonds issued - - - - Payment to refund commercial paper - - - - Sale of capital assets 14,420 - 25,400 13,043 Insurance proceeds 88,093 67,425 - - Transfers in 16,550,941 759,813 717,800 48,997 Transfers out (363,200) 11,734,662) (663,445) (1,122,807) Total other financing sources (uses) 16,290,254 (10,907,424) 79,755 (1,060,767) Net change in fund balances (790,960) (3,466,061) 976,309 (613,855) Fund balances (deficits) at beginning of year 2,609,421 14,226,854 1,581,690 3,541,241 Fund balances (deficits) at end of year $ 1,818,461 $ 10,760,793. _ $ _ 2,557,999 5. -. -_. 2,927,386 See accompanying independent auditor's report eaF Revenue Funds Grants and Fire Shared Improvement Control Revenues Districts Districts _ $ - $ 3,716,075 $ 3,552,225 $ 17,875,798 - - 50,000 164,250 6,098 911 Public Lighting Enhancement Records Districts Fee Modernization 824,785 $ 1,904,341 $ - 808,877 316,450 22,008 930,239 249,710 803,706 16,153 5,426 4,543 34,113 10,590 1,760 18,878,045 4,933,741 3,579,902 831,088 1,938,454 1,135,917 1,099,031 - - - - 1,633,740 2,370,626 - 3,255,308 - 1,861,325 - 68,611 380,793 - - - - 536,418 2,012,929 - 787,821 - - 6,974,085 - - - - - 2,829,005 - - - - - 3,414 884,850 - - - - 60,553 17,367 2,957,579 1,659,981 48,027 6,876 43,480 16,838,769 4,938,553 3,381,255 794,697 1,861,325 1,677,220 2,039,276 (4,812) 198,647 36,391 77,129 (541,303) - 330,776 (45,921) 436 509,820 (310,559) 4,684 280,931 (352,343) - 7,909 (208,340) - - - - 284,855 199,697 (66,728) (200,431( 2,324,131 7,332,332 194,885 26,499,630 131,919 993,275 (164,040) 485,806 77,129 (541,303) 3,968,869 4,290,475 $ 9,656,463 $ 26,694,515 $ 1,125,194 $ 321,766 $ 4,045,998 $ 3,749,172 (Continued) 91 COLLIER COUNTY, FLORIDA COMBINING STATEMENT OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCES NONMAJOR GOVERNMENTAL FUNDS FOR THE FISCAL YEAR ENDED SEPTEMBER 30, 2010 Revenue Expenditures Current: General government - State Public safety - - 1,075,895 1,536,923 Physical environment Housing - - - Transportation - Tourist Initiative 8D0 MHZ State Court Human services Development Partnership ICRP Fund Administration Revenues: Debt service: - - Principal Taxes $ 12,856,489 $ - $ - $ - Licenses,permitsandimpactfees - - - - Intergovernmental 9,736,561 294,879 - - Chargesforservices 5,713 486 444,445 155,395 Fines and forfeitures - - - 1,147,714 Interest income 246,981 26,132 1,143 1,782 Special assessments - - - - Miscellaneous 65,711 155,412 115,329 15,374 Total revenues 22,911,455 476,909 560,917 1,320,265 Expenditures Current: General government - - - 973,698 Public safety - - 1,075,895 1,536,923 Physical environment 1,563,249 - - - Transportation - - - - Economic environment - 463,242 - Human services - - - - Culture and recreation 8,652,133 - - - Debt service: - - Principal - - - - Interest 1,826 - - - Fiscal charges - - - - Capital outlay 211,400 - - 18,200 Total expenditures 10,428,608 463,242 1,075,895 2,528,821 Excess (deficiency) of revenues Total other financing sources (uses) (504,572) over (under) expenditures 12,482,847 13,667 (514,978) (1,208,556) Other financing sources (uses): Bonds issued - - - - Premiums on bonds issued - - - - Payment to refund commercial paper - - - - Sale of capital assets - - - - insurance proceeds 1,549 - 4,372 - Transfers in 114,033 - 473,400 1,315,125 Transfers out (620,154) (62,500) Total other financing sources (uses) (504,572) 477,772 1,252,625 Net change in fund balances 11,978,275 13,667 (37,206) 44,069 Fund balances (deficits) at beginning of year 26,304,272 820,772 147,823 127,047 Fund balances (deficits) at end of year $ 38,282,547_ $ _ 834,439 $ 110,617 $ 171,116 See accompanying independent auditor's report 92 Special Revenue Funds 474,080 69,000 - - - - 1,280 - - 326,162 957,976 - - 2,783 86,387 576,824 44,386 69,000 86,387 326,162 1,534,800 522,529 (17,185) (73,189) 41,393 6,871,499 7,805 111,689 - GAC land - 3,541,361 - - (25,921) Court Confiscated Sales, Roads utility Conservation Impact Fee Information Property and Canals Fee Collier Escrow Technology 630,156 16,572,936 647,261 260,907 $ 729,099 $ 1,482,436 $ 671,549 $ 23,261,924 $ 655,066 $ 372,596 $ - $ - $ 257,874 $ 8,181,652 - - 104,000 8,500 - 630,272 45,173 - - - - - 6,642 13,198 5,461 192,398 7,805 3,946 - - 220 23,749 51,815 13,198 367,555 8,406,299 7,805 634,218 474,080 69,000 - - - - 1,280 - - 326,162 957,976 - - 2,783 86,387 576,824 44,386 69,000 86,387 326,162 1,534,800 522,529 (17,185) (73,189) 41,393 6,871,499 7,805 111,689 - - - 3,541,361 - - (25,921) (3,723,872) (25,921) (182,511) (43,106) (73,189) 41,393 6,688,988 7,805 111,689 772,205 1,555,625 630,156 16,572,936 647,261 260,907 $ 729,099 $ 1,482,436 $ 671,549 $ 23,261,924 $ 655,066 $ 372,596 (Continued) 93 COLLIER COUNTY, FLORIDA COMBINING STATEMENT OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCES NONMAJOR GOVERNMENTAL FUNDS FOR THE FISCAL YEAR ENDED SEPTEMBER 30, 2010 Revenues: Taxes Licenses, permits and impact fees Intergovernmental Charges for services Fines and forfeitures Interest income Special assessments Miscellaneous Total revenues Expenditures: Current: General government Public safety Physical environment Transportation Economic environment Human services Culture and recreation Debt service: Principal Interest Fiscal charges Capital outlay Total expenditures Excess (deficiency) of revenues over (under) expenditures Other financing sources (uses): Bonds issued Premiums on bonds issued Payment to refund commercial paper Sale of capital assets Insurance proceeds Transfersin Transfers out Total other financing sources (uses) Net change in fund balances Fund balances (deficits) at beginning of year Fund balances (deficits) at end of year See accompanying independent auditor's report Special Revenue Funds Court Court University Facilities Affordable Services Extension Fee Housing 8,001,745 2,087 - 1,132,754 - 490 13,669 5,102 18,016 19,261 80001,745 20,593 1,146,423 24,363 7,559,481 - 120,697 15,434 10,633 7,559,481 15,434 131,330 442,264 5,159 1,015,093 24,363 442,264 5,159 1,015,093 24,363 188,610 40,949 1,130,156 579,479 $ 630,874 $ 46,108 $ 2,145,249 $ 603,842 Special Revenue Funds Debt Service Funds Other Total 21,605,181 Pooled Special Special Gas Tax Capital Commercial Revenue Revenue Revenue Improvement Paper Caribbean Funds Funds Bonds Revenue Bonds Program Gardens Loan $ - $ 69,842,146 $ - $ - $ - $ 43,110 8,800 9,362,614 - - - - - 38,479,957 - - - - 1,072,119 8,830,211 - - - - 174,482 3,160,856 - - - - 31,518 1,149,842 17,375 25,019 349 2,048 2,578,583 - - - - 85,987 2,576,421 1,368 1,372,906 135,980,630 17,375 25,019 349 46,526 147,630 21,324,808 - - - - 754,451 21,605,181 - - - - - 7,414,777 - - - - - 34,493,305 - - - - - 7,585,760 - - - - 139,262 2,971,050 - - - - 5,131 20,103,956 - - - - - 60,553 6,935,000 9,450,000 6,154,000 - - 19,193 7,645,243 9,958,063 454,172 - - - 7,549 12,996 11,873 5,502 145,188 7,509,989 1,191,662 123,088,572 14,587,792 19,421,059 6,620,045 5,502 181,244 12,892,058 (14,570,417) (19,396,040) (6,619,696) 41,024 19,529 72,392 - - - - - 166,559 - - - - 65,891 24,716,797 14,633,100 19,409,200 6,620,409 12,569 (45,715) (19,279,439) (90,241) 39,705 5,676,309 14,633,100 19,409,200 6,620,409 (77,672) 220,949 18,568,367 62,683 13,160 713 (36,648) 4,446,667 119,754,458 3,773,998 89,763 206,152 279,755 $ 4,667,616 $ 138,322,825 $ 3,836,681 $ 102,923 $ 206,865 $ 243,107 (Continued) COLLIER COUNTY, FLORIDA COMBINING STATEMENT OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCES NONMAJOR GOVERNMENTAL FUNDS FOR THE FISCAL YEAR ENDED SEPTEMBER 30, 2010 Funds m Stormwater Limited General Improvement Obligation Bonds Community Forest Lakes Assessment Conservation Redevelopment Limited General Bond Collier Taxable Note Obligation Bonds Revenues: Taxes $ - $ 8,744,405 $ - $ 486,454 Licenses, permits and impact fees - - - - Intergovernmental - - - - Chargesforservices - - - - Finesandforfeitures - - - - interest income 1,899 15,302 14,040 1,917 Special assessments 115,169 - - - Miscellaneous Total revenues 117,068 8,759,707 14,040 488,371 Expenditures: Current: General government - - - Public safety - - - - Physical environment - - - - Transportation - - - Economic environment - - - - Human services - - - - Cultureandrecreation - - - - Oebt service: Principal 165,000 7,217,279 900,000 340,000 Interest 21,930 1,275,083 532,944 218,713 Fiscal charges 6,851 6,845 610 2,756 Capital outlay Total expenditures 193,781 8,499,207 1,433,554 561,469 Excess (deficiency) of revenues over (under) expenditures (76,713) 260,500 (1,419,514) (73,098) Other financing sources (uses): Bonds issued - - - - Premiums on bonds issued - - - - Payment to refund commercial paper - - - - Sale of capital assets - - - - Insurance proceeds - - - - Transfersin 1,006 1,023,060 1,432,944 5,598 Transfers out (4,051) (1,154,837) (15,867) Total other financing sources (uses) (3,045) (131,777) 1,432,944 (10,269) Net change in fund balances (79,758) 128,723 13,430 (83,367) Fund balances (deficits) at beginning of year 201,239 241,857 1,560,967 209,784 Fund balances (deficits) at end of year $ 121,481 $ 370,580 $ 1,574,397 $ 126,417 See accompanying independent auditor's report m Debt Service Funds Capital Projects Funds Special State Total County-Wide County -Wide Obligation Infrastructure Debt Service Capital Parks Library Revenue Bonds Bank Loan Funds Improvements Improvements Impact Fees 9,273,969 $ - $ - $ - - - 497,174 668,566 - 2,131 - - 119,716 409 - 78,358 116,550 98,773 35,315 - - 115,169 - - - 1,368 1,039 62,454 409 9,468,864 117,589 780,248 703,881 3,119,678 - 406,738 13,843 727,257 80,354 - 1,839,148 33,000,427 99,222 - - - 200,852 20,307,000 13,518 - - 835,609 - 890,591 - - - - 844,241 5,816,926 1,201,940 623,985 835,609 2,040,000 54,198,018 9,469,925 1,929,197 704,339 (835,200) (2,040,000) (44,729,154) (9,352,336) (1,148,949) (458) 59,895,000 - 59,895,000 - - - 844,241 - 844,241 - - - (59,893,000) - (59,893,000) - - - - - - 78,815 - - - 2,040,000 45,177,886 10,092,100 489,374 - (1,264,996) (150,000) (399,710) (1,436,727) 846,241 2,040,000 44,759,131 10,020,915 89,664 (1,436,727) 11,041 - 29,977 668,579 (1,059,285) (1,437,185) 6,563,515 42,571,117 13,455,989 (4,148,592) $ 11,041 $ $ 6,593,492 $ 43,239,696 $ 12,396,704 $ (5,585,777) (Continued) 97 COLLIER COUNTY, FLORIDA COMBINING STATEMENT OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCES NONMAIOR GOVERNMENTAL FUNDS FOR THE FISCAL YEAR ENDED SEPTEMBER 30, 2010 Capital Projects Funds Expenditures: Current: General government Public safety 41,311 50,032 Emergency - Physical environment - - Correctional Medical Transportation Parks - Facilities Services Water Impact - Impact Fees Impact Fees Management Districts Revenues: - - - 28,809 Debt service: Taxes $ - $ - $ - $ - Licenses, permits and impact fees 446,417 190,524 - 3,684,198 Intergovernmental - - 2,664,656 91,417 Charges for services - - 13 - Fines and forfeitures - - - - Interest income 16,535 11,793 92,846 125,420 Special assessments - - 53,906 - Miscellaneous Total revenues 462,952 202,317 2,811,421 3,901,035 Expenditures: Current: General government Public safety 41,311 50,032 - - Physical environment - - 900,369 - Transportation - - - - Economic environment - - - - Human services - - - - Culture and recreation - - - 28,809 Debt service: Principal - - - - Interest - - - - Fiscal charges - - - - Capital outlay 34,810 7,787,690 3,394,207 Total expenditures 41,311 84,842 8,688,059 3,423,016 Excess (deficiency) of revenues over (under) expenditures 421,641 117,475 (5,876,638) 478,019 Other financing sources (uses): Bonds issued - - - - Premiums on bonds issued - - - - Payment to refund commercial paper - - - - Sale of capital assets - - - insurance proceeds - - - Transfersin - - 8,093,200 Transfers out (1,952,900) (1,270,778) (1,302,486) (3,128,500) Total other financing sources (uses) (1,952,900) (1,270,778) 6,790,714 (3,128,500) Net change in fund balances (1,531,259) (1,153,303) 914,076 (2,650,481) Fund balances (deficits) at beginning of year 723,823 (101,572) 8,035,184 16,635,975 Fund balances (deficits) at end of year $ (807,436) $ (1,254,875) $ 8,949,260 $ 13,985,494 See accompanying independent auditor's report Funds $ - $ 12,895,300 $ Total Total Road law Other Capital Nonmajor Impact Road Enforcement Capital Projects Governmental Districts Construction Impact Fees Projects Funds Funds $ - $ 12,895,300 $ - $ - $ 12,895,300 $ 92,011,415 12,475,246 - 333,341 2,060 18,297,526 27,660,140 - 9,220,976 - - 11,979,180 50,459,137 - 125,457 - - 245,186 9,075,397 - - - - 3,160,856 649,009 781,633 32,355 28,293 1,988,522 3,216,722 - - - 100,106 154,012 2,847,764 4,526 978,424 500,000 1,546,443 4,124,232 13,128,781 24,001,790 365,696 630,459 47,106,169 192,555,663 - - - 179,952 3,299,630 24,624,438 - - 129,318 17,911 645,310 22,250,491 - - - 920,174 1,820,543 9,235,320 1,366,413 7,817,452 - - 9,183,865 43,677,170 - - - - - 7,585,760 - - - - - 2,971,050 - - - 455,036 1,305,299 21,409,255 99,222 33,160,202 - - - 13,518 20,339,711 - - - - - 890,591 19,212,489 15,168,316 407,353 889,297 54,537,013 62,047,002 20,578,902 22,985,768 536,671 2,462,370 70,904,400 248,190,990 (7,450,121) 1,016,022 (170,975) (1,831,911) (23,798,231) (55,635,327) - - - - - 59,895,000 - - - - - 844,241 - - - - - (59,893,000) - - - - - 72,392 - 213 - - 79,028 245,587 - 6,209,399 - 1,041,214 25,925,287 95,819,970 (22,061,125) (3,020,434) (3,506) (34,726,166) (55,270,601) (15,851,513) (3,020,434) 1,037,708 (8,721,851) 41,713,589 (7,450,121) (14,835,491) (3,191,409) (794,203) (32,520,082) (13,921,738) 68,103,769 80,354,006 (7,284,158) 3,468,741 221,814,282 348,132,255 $ 60,653,648 $ 65,518,515 $ (10,475,567) $ 2,674,538 $ 189,294,200 $ 334,210,517 M COLLIER COUNTY, FLORIDA COMBINING SCHEDULE OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCES BUDGET AND ACTUAL (NON -GAAP) MAJOR CAPITAL PROJECT AND NONMAJOR GOVERNMENTAL FUNDS FOR THE FISCAL YEAR ENDED SEPTEMBER 30, 2010 Revenues: Taxes Licenses, permits and impact fees Intergovernmental Charges for services Fines and forfeitures Interest income Special assessments Miscellaneous Total revenues Expenditures: Current: General government Public safety Physical environment Transportation Economic environment Human services Culture and recreation Debt service Capital outlay Total expenditures Excess (deficit) of revenues over (under) expenditures Government Facilftles Impact Fees (Non -GAAP) Road Districts (Non -GAAP) Budget Actual Variance Budget Actual Variance $ - $ - $ - $ - $ - $ - 670,000 909,400 239,400 282,000 397,325 115,325 - - - 2,112,700 2,028,656 (84,044) - - - 13,600 176,642 163,042 - 69,680 69,680 35,100 21,636 (13,464) - - 126,100 40,314 (85,786) 670,000 979,080 309,080 2,569,500 2,664,573 95,073 429,285 419,556 9,729 - - - 300,000 278,246 21,754 - - - 21,215,519 19,446,990 1,768,529 4,662,808 1,992,872 2,669,936 345,727 303,263 42,464 5,392,093 2,690,674 2,701,419 21,561,246 19,750,253 1,810,993 (4,722,093) (1,711,594) 3,010,499 (18,991,746) (17,085,680) 1,906,066 Other financing sources (uses): Bonds issued - - - - - - Premiums on bonds issued - - - - - - Paymenttorefundcommercialpaper - - - - - - Sale of capital assets - - - 3,300 14,420 11,120 Insurance proceeds - - - 98,000 88,093 (9,907) Transfersin 7,524,600 7,524,600 - 16,722,796 16,550,941 (171,855) Transfers out (7,029,700) (6,070,659) 959,041 (363,200) (363,200) Total other financing sources (uses) 494,900 1,453,941 959,041 16,460,896 16,290,254 (170,642) Net change in fund balances (4,227,193) (257,653) 3,969,540 (2,530,850) (795,426) 1,735,424 Fund balances at beginning of year 7,631,480 7,631,480 2,691,550 2,691,550 Fund balances (deficits) at end of year $ 3,404,287 $ 71373,827 $ 3,969,540 $ 160,700 $ 11896,124 $ 11735,424 See accompanying independent auditors' report. Reconciliation: Net change in fund balance, budgetary basis $ (257,653) $ (795,426) Change in fair value of investments 10,568 5,186 Advances budgeted as transfers (6,894,600) - Unbudgetedfunds - (720) Deferred revenues Net change in fund balance, GAAP basis 100 Unincorporated Area MSTD (Non -GAAP) Community Development (Non -GAAP) Budget Actual Variance Budget Actual Variance 649,700 759,813 110,113 1,032,800 717,800 (315,000) $ 32,480,100 $ 36,564,249 $ 4,084,149 $ - $ - $ - 6,005,000 95,892 (5,909,108) 6,387,700 8,860,012 2,472,312 - 381,015 381,015 - - - 2,711,331 2,510,848 (200,483) 3,184,600 2,193,834 (990,766) 284,000 343,283 59,283 - 1,000 1,000 52,000 146,621 94,621 118,000 26,463 (91,537) 9,000 8,509 (491) - - - 169,900 211,442 41,542 98,500 79,849 (18,651) 41,711,331 40,261,859 (1,449,472) 9,788,800 11,161,158 1,372,358 6,038,293 5,636,187 402,106 5,143,020 3,580,100 1,562,920 4,301,937 4,153,674 148,263 6,554,700 6,452,882 101,818 1,094,890 899,610 195,280 330,000 229,661 100,339 12,036,884 10,003,797 2,033,087 - - - 175,800 145,841 29,959 - - - 10,854,700 10,289,186 565,514 - - - 2,074,059 1,157,122 916,937 8,100 7,733 367 36,576,563 32,285,417 4,291,146 12,035,820 10,270,376 1,765,444 5,134,768 7,976,442 2,841,674 (2,247,020) 890,782 3,137,802 25,400 25,400 49,587 67,425 17,838 - - - 649,700 759,813 110,113 1,032,800 717,800 (315,000) (12,711,772) (12,287,862) 423,910 (1,050,300) (663,445) 386,855 (12,012,485) (11,460,624) 551,861 (17,500) 79,755 97,255 (6,877,717) (3,484,182) 3,393,535 (2,264,520) 970,537 3,235,057 13,500,308 13,500,308 3,405,353 3,405,353 $ 6,622,591 $ 10,016,126 $ 3,393,535 $ 1,140,833 $ 4,375,890 $ 3,235,057 $ (3,484,182) $ 970,537 18,121 5,772 $ (3,466,061) $ 976,309 101 COLLIER COUNTY, FLORIDA COMBINING SCHEDULE OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCES BUDGET AND ACTUAL (NON -GAAP) MAJOR CAPITAL PROJECT AND NONMAJOR GOVERNMENTAL FUNDS FOR THE FISCAL YEAR ENDED SEPTEMBER 30, 2010 Revenues: Taxes Licenses, permits and impact fees Intergovernmental Charges for services Fines and forfeitures Interest income Special assessments Miscellaneous Total revenues Expenditures: Current: General government Public safety Physical environment Transportation Economic environment Human services Culture and recreation Debt service Capital outlay Total expenditures Excess (deficit) of revenues over (under) expenditures Water Management and Pollution Control (Non -GAAP) Grants and Shared Revenues (Non -GAAP) Budget Actual Variance Budget Actual Variance $ 2,064,700 $ 1,984,456 $ (80,244) $ - $ - $ - 500 585 85 - - - 158,500 161,303 2,803 23,923,782 16,490,926 (7,432,856) 476,800 496,645 19,845 50,000 50,000 - 40,900 28,334 (12,566) - 6,774 6,774 2,665,000 2,570,074 (94,926) - - - 46,456 4,626 4,626 110,504 929,239 818,735 5,299,312 4,803,436 495,876 48,028,190 14,965,641 32,208,669 5,406,400 5,246,023 (160,377) 24,084,286 17,476,939 (6,607,347) - - - 3,208,329 1,025,327 2,183,002 - - - 2,730,754 1,303,069 1,427,685 3,272,155 2,957,293 314,862 115,067 68,611 46,456 1,664,874 1,526,846 138,028 1,390,298 536,418 - - - - 28,981,569 6,974,085 22,007,484 - - - 5,009,474 2,829,005 2,180,469 - - - 218,193 3,414 214,779 362,283 319,297 42,986 6,374,506 2,225,712 4,148,794 5,299,312 4,803,436 495,876 48,028,190 14,965,641 32,208,669 107,088 442,587 335,499 (23,943,904) 2,511,298 25,601,322 Other financing sources (uses): Bonds issued - - - - - - Premiums on bonds issued - - - - - - Payment to refund commercial paper - - - - - - Sale of capital assets - 13,043 13,043 - - - insurance proceeds - - - - - Transfers in - 48,997 48,997 1,286,165 325,359 (960,806) Transfers out (1,205,800) (1,122,807) 82,993 (146,400) (45,921) 100,479 Total other financing sources (uses) (1,205,800) (1,060,767) 145,033 1,139,765 279,438 (860,327) Net change in fund balances (1,098,712) (618,180) 480,532 (22,804,139) 2,790,736 24,740,995 Fund balances at beginning of year 3,142,012 3,142,012 25,072,819 25,072,819 Fund balances (deficits) at end of year $ 2,043,300 $ 2,523,832 $ 480,532 $ 2,268,680 $ 27,863,555 $ 25,594,875 See accompanying independent auditors' report Reconciliation: Net change in fund balance, budgetary basis $ (618,180) $ 2,790,736 Change in fairvalue of investments 4,325 3,635 Advances budgeted as transfers - - Unbudgetedfunds - (470,240) Deferred revenues Net change in fund balance, GAAP basis $ (613,855) $ 2,324,131 102 Improvement Districts (Non -GAAP) Fire Control Districts (Non -GAAP) Budget Actual Variance Budget Actual Variance 1,263,525 509,820 (753,705) 262,100 280,931 18,831 $ 3,848,600 $ 3,716,075 $ (132,525) $ 3,684,500 5 3,552,225 $ (132,275) 191,300 164,250 (27,050) 8,500 6,098 (2,402) 112,700 213,533 100,833 23,900 14,186 (9,714) 6,000 803,706 797,706 956,257 5,426 5,426 $ 1,236,200 $ 23,714,698 $ 22,478,498 $ 1,024,439 $ 1,086,209 $ 61,770 4,158,600 4,897,564 738,964 3,716,900 3,577,935 (138,965) - - - 3,409,722 3,255,308 154,414 382,200 380,793 1,407 - - - 2,014,187 2,012,929 1,258 - - - 999,700 884,850 114,850 - - - - - - 79,000 77,920 1,080 24,013,908 1,659,981 22,353,927 57,725 48,027 9,698 27,409,995 4,938,553 22,471,442 3,546,447 3,381,255 165,192 (23,251,395) (40,989) 23,210,406 170,453 196,680 26,227 - 436 436 4,600 4,684 84 1,263,525 509,820 (753,705) 262,100 280,931 18,831 (331,920) (310,559) 21,361 (368,971) (352,343) 16,628 931,605 199,697 (731,908) (102,271) (66,728) 35,543 (22,319,790) 158,708 22,478,498 68,182 129,952 61,770 23,555,990 23,555,990 956,257 956,257 $ 1,236,200 $ 23,714,698 $ 22,478,498 $ 1,024,439 $ 1,086,209 $ 61,770 $ 158,708 $ 129,952 36,177 1,967 $ 194,885 $ 131,919 103 COLLIER COUNTY, FLORIDA COMBINING SCHEDULE OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCES BUDGET AND ACTUAL (NON -GAAP) MAJOR CAPITAL PROJECT AND NONMAJOR GOVERNMENTAL FUNDS FOR THE FISCAL YEAR ENDED SEPTEMBER 30, 2010 Revenues: Taxes Licenses, permits and impact fees Intergovernmental Charges for services Fines and forfeitures Interest income Special assessments Miscellaneous Total revenues Expenditures: Current: General government Public safety Physical environment Transportation Economic environment Human services Culture and recreation Debt service Capital outlay Total expenditures Excess (deficit) of revenues over (under) expenditures Other financing sources (uses): Bonds issued Premiums on bonds issued Payment to refund commercial paper Sale of capital assets Insurance proceeds Transfersin Transfers out Lighting Districts (Non -GAAP) 911 Enhancement Fee (Non -GAAP) Budget Actual Variance Budget Actual Variance $ 855,800 $ 824,785 $ (31,015) $ 2,015,900 $ 1,904,341 $ (111,559) 4,600 3,937 (663) 66,900 28,903 (37,997) 1,760 1,760 860,400 830,482 (29,918) 2,082,800 1,933,244 (149,556) 4,360,976 1,861,325 2,499,651 933,662 787,821 145,841 - - - 14,200 6,876 7,324 434,000 434,000 947,862 794,697 153,165 4,794,976 1,861,325 2,933,651 (87,462) 35,785 123,247 (2,712,176) 71,919 2,784,095 7,909 7,909 (220,200) (208,340) 11,860 Total other financing sources (uses) (220,200) (200,431) 19,769 Net change in fund balances (307,662) (164,646) 143,016 (2,712,176) 71,919 2,784,095 Fund balances at beginning of year 445,462 445,462 3,857,676 3,857,676 Fund balances (deficits) at end of year $ 137,800 $ 280,816 $ 143,016 $ 1,145,500 $ 3,929,595 $ 2,784,095 See accompanying Independent auditors' report Reconciliation: Net change in fund balance, budgetary basis $ (164,646) $ 71,919 Change in fair value of investments 606 5,210 Advances budgeted as transfers - - Unbudgetedfunds - - Deferred revenues Net change in fund balance, GAAP basis $ (164,040) $ 77,129 104 Public Records Modernization Tourist Development (Non -GAAP) Budget Actual Variance Budget Actual Variance - - 1,461,000 1,399,833 (61,167) $ - $ - $ - $ 13,050,100 $ 12,856,489 $ (193,611) - - - 175,000 9,736,561 9,561,561 675,000 808,877 133,877 - 5,713 5,713 - 316,450 316,450 - - - - 10,590 10,590 - 207,963 207,963 20,000 65,711 45,711 675,000 1,135,917 460,917 13,245,100 22,872,437 9,627,337 1,913,300 1,633,740 279,560 - - - - - - 6,290,671 1,563,249 4,727,422 - - - 9,501,302 8,648,873 852,429 - - - 2,000 1,826 174 1,287,100 43,480 1,243,620 7,990,378 211,400 7,778,978 3,200,400 1,677,220 1,523,180 23,784,351 10,425,348 13,359,003 (2,525,400) (541,303) 1,984,097 (10,539,251) 12,447,089 22,986,340 - - - - 1,549 1,549 - - - 1,461,000 1,399,833 (61,167) (2,210,600) (1,905,954) 304,646 (749,600) (504,572) 245,028 (2,525,400) (541,303) 1,984,097 (11,288,851) 11,942,517 23,231,368 4,253,663 4,253,663 27,250,365 27,250,365 $ 1,728,263 $ 3,712,360 $ 1,984,097 $ 15,961,514 $ 39,192,882 $ 23,231,368 $ (541,303) $ 11,942,517 39,018 (3,260) $ (541,303) $ 11,978,275 105 COLLIER COUNTY, FLORIDA COMBINING SCHEDULE OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCES BUDGET AND ACTUAL (NON -GAAP) MAJOR CAPITAL PROJECT AND NONMAJOR GOVERNMENTAL FUNDS FOR THE FISCAL YEAR ENDED SEPTEMBER 30, 2010 State Housing Initiativeship Partnership (Non -GAAP) 800 MHZ IRCP Fund (Non -GAAP) Budget Actual Variance Budget Actual Variance Revenues: Taxes $ - 5 - $ - $ - $ - $ - Licenses, permits and impact fees - - - - - - Intergovernmental - 294,879 294,879 - - - Chargesforservices - 486 486 503,500 444,445 (59,055) Fines and forfeitures - - - - - Interest income - 22,387 22,387 4,900 956 (3,944) Special assessments - - - - - - Miscellaneous 155,412 155,412 116,300 115,329 (971) Total revenues 473,164 473,164 624,700 560,730 (63,970) Expenditures: Current: General government - - - - - Public safety - - - 1,088,500 1,078,895 9,605 Physical environment - - - - - - Transportation - - - - - Economic environment 1,263,286 463,242 800,044 - - Human services - - - - - - Cultureandrecreation - - - - - - Debt service - - - - - - Capital outlay - - - - - Total expenditures 1,263,286 463,242 800,044 1,088,500 1,078,895 9,605 Excess (deficit) of revenues over (under) expenditures (1,263,286) 9,922 1,273,208 (463,800) (518,165) (54,365) Other financing sources (uses): Bonds issued - - - - - - Premiums on bonds issued - - - - - - Payment to refund commercial paper - - - - - - Saleofcapitalassets - - - - - - Insurance proceeds - - - - 4,372 4,372 Transfers in - - - 473,400 473,400 - Transfers out Total other financing sources (uses) 473,400 477,772 4,372 Net change in fund balances (1,263,286) 9,922 1,273,208 9,600 (40,393) (49,993) Fund balances at beginning of year 1,263,286 1,263,286 73,900 73,900 Fund balances (deficits) at end of year $ - $ 1,273,208 $ 1,273,208 $ 83,500 $ 33,507 _L __i49,9931 See accompanying Independent auditors' report. Reconciliation: Net change in fund balance, budgetary basis $ 9,922 $ (40,393) Change in fair value of investments 3,745 187 Advances budgeted as transfers - - Unbudgetedfunds - 3,000 Deferred revenues Net change in fund balance, GAAP basis $ 13,667 $ (37,206) State Court Administration (Non -GAAP) Confiscated Property (Non -GAAP) - (519,100) - (25,921) - 493,179 1,258,300 1,252,625 Budget Actual Variance Budget Actual Variance 80,130 (484,600) 690,200 (44,053) 690,200 440,547 $ 193,100 $ 273,230 $ 80,130 $ 205,600 $ 646,147 $ 440,547 120,000 155,395 35,395 - - - 1,344,000 1,147,714 (196,286) 83,300 45,173 (38,127) 7,700 1,443 (6,257) 26,200 5,695 (20,505) 15,374 15,374 1,471,700 1,319,926 (151,774) 109,500 50,868 (58,632) 1,142,300 973,698 168,602 - - - 1,595,100 1,536,923 58,177 75,000 69,000 6,000 29,000 18,200 10,800 2,766,400 2,528,821 237,579 75,000 69,000 6,000 (1,294,700) (1,208,895) 85,805 34,500 (18,132) (52,632) 1,320,800 (62,500) 1,315,125 (62,500) (5,675) - (519,100) - (25,921) - 493,179 1,258,300 1,252,625 (5,675) (519,100) (25,921) 493,179 (36,400) 229,500 43,730 229,500 80,130 (484,600) 690,200 (44,053) 690,200 440,547 $ 193,100 $ 273,230 $ 80,130 $ 205,600 $ 646,147 $ 440,547 $ 43,730 $ (44,053) 339 947 $ 44,069 $ (43,106) 107 COLLIER COUNTY, FLORIDA COMBINING SCHEDULE OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCES BUDGET AND ACTUAL (NON -GAAP) MAJOR CAPITAL PROJECT AND NONMAJOR GOVERNMENTAL FUNDS FOR THE FISCAL YEAR ENDED SEPTEMBER 30, 2010 GAC Land Sales, Roads and Canals (Non -GAAP) Utility Fees (Non -GAAP) Total other financing sources (uses) Net change in fund balances Budget Actual Variance Budget Actual Variance Fund balances at beginning of year 1,427,600 1,427,600 - 616,700 616,700 Revenues: Fund balances (deficits) at end of year $ 1,496,930 $ 1,352,517 $ (144,4131 $ 619,400 $ 657,314 $ Taxes $ - $ - $ - $ 225,000 $ 257,874 $ 32,874 Licenses, permits and impact fees - - - - - - Intergovernmental - - - - - - Chargesforservices - - - 104,000 104,000 - Fines and forfeitures - - - - - - Interest income 46,000 11,304 (34,696) - 4,682 4,682 Special assessments - - - - - - Miscellaneous 151,700 (151,700) 220 220 Total revenues 197,700 11,304 (186,396) 329,000 366,776 37,776 Expenditures: Current: General government - - - - - - Public safety - - - - - - Physical environment - - - 326,300 326,162 138 Transportation - - - - - - Economic environment - - - - - - Human services - - - - - - Culture and recreation 128,370 86,387 41,983 - - Debt service - - - - - - Capital outlay - - - Total expenditures 128,370 86,387 41,983 326,300 326,162 138 Excess (deficit) of revenues over (under) expenditures 69,330 (75,083) (144,413) 2,700 40,614 37,914 Otherfinancing sources (uses): Bonds issued - - - - - - Premiums on bonds issued - - - - - - Payment to refund commercial paper - - - - - - Saleofcapitalassets - - - - - - insurance proceeds - - - - - - Transfersin - - - - - - Transfers out - - - - - - Total other financing sources (uses) Net change in fund balances 69,330 (75,083) (144,413) 2,700 40,614 37,914 Fund balances at beginning of year 1,427,600 1,427,600 - 616,700 616,700 Fund balances (deficits) at end of year $ 1,496,930 $ 1,352,517 $ (144,4131 $ 619,400 $ 657,314 $ 37,914 See accompanying independent audi tors' report Reconciliation: Net change in fund balance, budgetary basis $ (75,083) $ 40,614 Change in fair value of investments 1,894 779 Advances budgeted as transfers - - Unbudgetedfunds - - Deferred revenues Net change in fund balance, GAAP basis $ (73,189) $ 41,393 108 4,240,400 3,541,361 (699,039) - - - Court Information (3,723,872) Conxrvation Collier (Non -GAAP) Technology Fee (Non -GAAP) (182,511( 179,789 4,681,039 6,660,041 Budget Actual Variance Budget Actual Variance $ 21,440,500 $ 23,419,502 $ 1,979,002 $ 72,500 $ 393,078 $ 320,578 $ 8,498,100 $ 8,181,652 $ (316,448) $ - $ - $ - 642,100 8,500 (633,600) 600,000 630,272 30,272 420,100 163,451 (256,649) - 3,235 3,235 2,400 23,749 21,349 9,562,700 8,377,352 (1,185,348) 600,000 633,507 33,507 - - - 580,900 474,080 106,820 - - - 4,500 1,280 3,220 1,301,661 957,976 343,685 - - - - - - 4,500 2,783 1,717 3,217,700 576,824 2,640,876 219,700 44,386 175,314 4,519,361 1,534,800 2,984,561 809,600 522,529 287,071 5,043,339 6,842,552 1,799,213 (209,600) 110,978 320,578 4,240,400 3,541,361 (699,039) - - - (4,602,700) (3,723,872) 878,828 (362,300) (182,511( 179,789 4,681,039 6,660,041 1,979,002 (209,600) 110,978 320,578 16,759,461 16,759,461 282,100 282,100 $ 21,440,500 $ 23,419,502 $ 1,979,002 $ 72,500 $ 393,078 $ 320,578 $ 6,660,041 $ 110,978 28,947 711 $ 6,688,988 $ 111,689 109 COLLIER COUNTY, FLORIDA COMBINING SCHEDULE OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCES BUDGET AND ACTUAL (NON -GAAP) MAJOR CAPITAL PROJECT AND NONMAJOR GOVERNMENTAL FUNDS FOR THE FISCAL YEAR ENDED SEPTEMBER 30, 2010 Court Services University Extension (NOn-GAAP) Budget Actual Variance Budget Actual Variance Revenues: 1,086,657 442,264 (644,393) (3,900) 5,100 9,000 Fund balances at beginning of year Taxes $ - $ 33,100 $ - $ - $ $ ' Licenses, permits and impact fees - - - - - - Intergovernmental 8,878,476 8,001,745 (876,731) - - - Chargesforservices - - - 9,500 2,087 (7,413) Fines and forfeitures - - - - - - Interest income - - - - 431 431 Special assessments - - - - - - Miscellaneous 5,000 18,016 13,016 Total revenues 8,878,476 8,001,745 (876,731) 14,500 20,534 6,034 Expenditures: Current: General government 7,791,819 7,559,481 232,338 - - - Public safety - - - - - - Physical environment - - - 18,400 15,434 2,966 Transportation - - - - - - Economic environment - - - - - Human services - - - - - - Culture and recreation - - - - - Debt service - - - - - Capital outlay - - - - - Total expenditures 7,791,819 7,559,481 232,338 18,400 15,434 2,966 Excess (deficit) of revenues over (under) expenditures 1,086,657 442,264 (644,393) (3,900) 5,100 9,000 Other financing sources (uses): Bonds issued - - - Premiums on bonds issued - - - - - - Payment to refund commercial paper - - - - - - Sale of capital assets - - - - - - insurance proceeds - - - - - Transfers in - - - - - - Transfers out - - - - - - Total other financing sources (uses) Net change In fund balances 1,086,657 442,264 (644,393) (3,900) 5,100 9,000 Fund balances at beginning of year - - 33,100 33,100 - Fund balances (deficits) at end of year $ 1,086,657 $ 442,264 $ (644,393) $ 29,200 $ 38,200 $ 9,000 See accompanying independent auditors' report. Reconciliation: Net change in fund balance, budgetary basis Change in fair value of Investments Advances budgeted as transfers Unbudgeted funds Deferred revenues Net change in fund balance, GAAP basis $ 442,264 $ 442,264 110 $ 5,100 59 $ 5,159 Other Special Court Facilities Fee (Non -GAAP) Revenue Funds (Non Budget Actual Variance Budget Actual Variance - - 113,400 65,891 (47,509) (248,900) (45,715) 203,185 (135,500) - - - 16,000 8,800 (7,200) - - - 103,561 - (103,561) - - - 545,400 494,955 (50,445) 1,000,000 1,132,754 132,754 170,200 174,482 4,282 30,000 11,204 (18,796) 19,500 23,527 4,027 121,800 67,552 (54,248) 1,030,000 1,143,958 113,958 976,461 769,316 (207,145) 122,923 120,697 2,226 203,300 147,630 55,670 - - - 776,665 319,643 457,022 - - - 350,712 139,262 211,450 - - - 24,000 5,131 18,869 1,924,728 10,633 1,914,095 600,465 132,388 468,077 2,047,651 131,330 1,916,321 1,955,142 744,054 1,211,088 (1,017,651) 1,012,628 2,030,279 (978,681) 25,262 1,003,943 - - - - 19,529 19,529 - - - 113,400 65,891 (47,509) (248,900) (45,715) 203,185 (135,500) 39,705 175,205 (1,017,651) 1,012,628 2,030,279 (1,114,181) 64,967 1,179,148 1,052,651 1,052,651 2,713,716 2,713,716 $ 35,000 $ 2,065,279 $ 2,030,279 $ 1,599,535 $ 2,778,683 $ 1,179,148 $ 1,012,628 $ 64,967 2,465 4,004 151,978 $ 1,015,093 $ 220,949 111 COLLIER COUNTY, FLORIDA COMBINING SCHEDULE OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCES BUDGET AND ACTUAL (NON -GAAP) MAJOR CAPITAL PROJECT AND NONMAJOR GOVERNMENTAL FUNDS FOR THE FISCAL YEAR ENDED SEPTEMBER 30, 2010 Capital Improvement Gas Tax Revenue Bonds (Non -GAAP) Revenue Bonds (Non -GAAP) Budget Actual Variance Budget Actual Variance Revenues: Taxes $ - $ - $ - $ - $ - $ - Licenses, permits and impact fees - - - - - - Intergovernmental - - - - - - Chargesforservices - - - - - - Fines and forfeitures - - - - - Interest income 100,000 12,425 (87,575) 1,400 58 (1,342) Special assessments - - - - - - Miscellaneous - - - - - - Total revenues 100,000 12,425 (87,575) 1,400 58 (1,342) Expenditures: Current: General government - - - - - Public safety - - - - - - Physical environment - - - - - - Transportation - - - - Economic environment - - - - - - Human services - - - - - - Cultureandrecreation - - - - - - Debt service 14,594,300 14,587,792 6,508 19,432,300 19,421,059 11,241 Capital outlay Total expenditures 14,594,300 14,587,792 6,508 19,432,300 19,421,059 11,241 Excess (deficit) of revenues over (under) expenditures (14,494,300) (14,575,367 ) (81,067) (19,430,900) (19,421,001) 9,899 Other financing sources (uses): Bonds issued - - - - - - Premiums on bonds issued - - - - - - Payment to refund commercial paper - - - - - - Sale of capital assets - - - - - - Insurance proceeds - - - - - - Transfersin 14,633,100 14,633,100 - 19,409,200 19,409,200 - Transfers out Total other financing sources (uses) 14,633,100 14,633,100 19,409,200 19,409,200 Net change in fund balances 138,800 57,733 (81,067) (21,700) (11,801) 9,899 Fund balances at beginning of year 3,826,600 3,826,600 19,592,500 19,592,500 Fund balances (deficits) at end of year $ 3,965,400 $ 3,884,333 $ (81,067) $ 19,570,800 $ 19,580,699 $ 9,899 See accompanying independent auditors' report. Reconciliation: Net change in fund balance, budgetary basis $ 57,733 Change in fair value of investments 4,950 24,961 Advances budgeted as transfers - - Unbudgetedfunds - Deferred revenues Net change in fund balance, GAAP basis $ 62,683 $ 13,160 112 Pooled Commercial Paper Program (Non -GAAP) Caribbean Gardens Loan (Non -GAAP) Budget Actual Variance Budget Actual Variance $ - $ 20,000 $ 43,110 $ 23,110 500 247 (253) 100 1,755 1,655 1,368 1,368 500 247 (253) 20,100 46,233 26,133 9,498,600 6,620,045 2,878,555 7,000 5,502 1,498 9,498,600 6,620,045 2,878,555 7,000 5,502 1,498 9,498,600 6,620,409 (2,878,191) (9,498,100) (6,619,798) 2,878,302 13,100 40,731 27,631 9,498,600 6,620,409 (2,878,191) - 12,569 12,569 (139,300) (90,241) 49,059 9,498,600 6,620,409 (2,878,191) (139,300) (77,672) 61,628 500 611 111 (126,200) (36,941) 89,259 81,000 81,000 127,200 127,200 $ 81,500 $ 81,611 $ 111 $ 1,000 $ 90,259 $ 89,259 $ 611 $ (36,941) 102 293 $ 713 113 COLLIER COUNTY, FLORIDA COMBINING SCHEDULE OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCES BUDGET AND ACTUAL (NON -GAAP) MAJOR CAPITAL PROJECT AND NONMAJOR GOVERNMENTAL FUNDS FOR THE FISCAL YEAR ENDED SEPTEMBER 30, 2010 Revenues: Taxes Licenses, permits and impact fees Intergovernmental Charges for services Fines and forfeitures Interest income Special assessments Miscellaneous Total revenues Expenditures: Current: General government Public safety Physical environment Transportation Economic environment Human services Culture and recreation Debt service Capital outlay Total expenditures Excess (deficit) of revenues over (under) expenditures Other financing sources (uses): Bonds issued Premiums on bonds issued Payment to refund commercial paper Sale of capital assets insurance proceeds Transfers in Transfers out Total other financing sources (uses) Net change in fund balances Stormwater Improvement Limited General Obligation Bonds, Assessment Bond (Non -GAAP) Conservation Collier Budget Actual Variance Budget Actual Variance $ - $ - $ - $ 9,118,900 $ 8,744,405 $ 10,100 1,594 (8,506) 5,300 13,679 105,200 115,169 9,969 - - (374,495) 8,379 115,300 116,763 1,463 9,124,200 8,758,084 (366,116) 209,600 193,781 15,819 8,499,400 8,499,207 193 209,600 193,781 15,819 8,499,400 8,499,207 193 (94,300) (77,018) 17,282 624,800 258,877 (365,923) - 1,006 1,006 1,600,000 1,023,060 (576,940) (7,500) (4,051) 3,449 (1,888,800) (1,154,837) 733,963 (7,500) (3,045) 4,455 (288,800) (131,777) 157,023 (101,800) (80,063) 21,737 336,000 127,100 (208,900) Fund balances at beginning of year 184,400 184,400 336,000 336,000 Fund balances (deficits) at end of year $ 82,600 $ 104,337 $ 21,737 $ 672,000 $ 463,100 $ (208,900) See accompanying independent auditors' report Reconciliation: Net change in fund balance, budgetary basis $ (80,063) $ 127,100 Change in fair value of investments 305 1,623 Advances budgeted as transfers - - Unbudgetedfunds - - Deferred revenues Net change in fund balance, GAAP basis $ (79,758) $ 128,723 114 Community Redevelopment Taxable Note (Non -GAAP) 1,433,554 Forest Lakes Limited General Obligation Bonds (Non -GAAP) Budget Actual Variance Budget Actual Variance $ - $ - $ - 12,039 - 12,039 $ 505,500 2,000 $ 486,454 $ (19,046) 1,744 (256) 12,039 12,039 507,500 488,198 (19,302) 1,788,200 1,433,554 354,646 563,300 561,469 1,831 1,788,200 1,433,554 354,646 563,300 561,469 1,831 (1,788,200) (1,421,515) 366,685 (55,800) (73,271) (17,471) 1,787,300 1,432,944 (354,356) - 5,598 5,598 (18,600) (15,867) 2,733 1,787,300 1,432,944 (354,356) (18,600) (10,269) 8,331 (900) 11,429 12,329 (74,400) (83,540) (9,140) 1,214,900 1,214,900 155,600 155,600 $ 1,214,000 $ 1,226,329 $ 12,329 $ 81,200 $ 72,060 $ 19,140) $ 11,429 $ (83,540) 2,001 173 $ 13,430 115 COLLIER COUNTY, FLORIDA COMBINING SCHEDULE OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCES BUDGET AND ACTUAL (NON -GAAP) MAJOR CAPITAL PROJECT AND NONMAJOR GOVERNMENTAL FUNDS FOR THE FISCAL YEAR ENDED SEPTEMBER 30, 2010 Special Obligation Revenue Bonds (Non -GAAP) State Infrastructure Bank Loan Budget Actual Variance Budget Actual Variance Revenues: Taxes $ - $ - $ - $ - Licenses, permits and impact fees - - - - - - Intergovernmental - - - - - - Chargesforservices - - - - - - Fines and forfeitures - - - - - Interest income - 264 264 - - - Special assessments Miscellaneous Total revenues 264 264 Expenditures: Current: General government - - - - - Public safety - - - - - Physical environment - - - - - - Transportation - - - - - Economic environment - - - - - - Human services - - - - - - Cultureandrecreation - - - - - Debt service 846,250 835,609 10,641 2,044,600 2,040,000 4,600 Capital outlay Total expenditures 846,250 835,609 10,641 2,044,600 2,040,000 4,600 Excess (deficit) of revenues over (under) expenditures (846,250) (835,345) 10,905 (2,044,600) )2,040,000) 4,600 Other financing sources (uses): Bonds issued 59,895,000 59,895,000 - - - - Premiums on bonds issued 844,250 844,241 (9) - - - Paymenttorefundcommercialpaper (59,893,000) (59,893,000) - - - - Saleofcapitalassets - - - - - - Insurance proceeds - - - - - Transfers in - - - 2,044,600 2,040,000 (4,600) Transfers out Total other financing sources (uses) 846,250 846,241 (9) 2,044,600 2,040,000 (4,600) Net change in fund balances - 10,896 10,896 - - - Fund balances at beginning of year Fund balances (deficits) at end of year $ - $ 10,896 $ 10,896 $ See accompanying independent auditors' report. Reconciliation: Net change in fund balance, budgetary basis $ 10,896 Change in fair value of investments 145 Advances budgeted as transfers - Unbudgetedfunds Deferred revenues Net change in fund balance, GAAP basis $ 11,041 116 I County -Wide Capital Improvements (Non -GAAP) Parks Improvements (Non -GAAP) Budget Actual Variance Budget Actual Variance 10,092,100 10,092,100 - 453,000 489,374 36,374 (13,339,900) (13,339,900) (450,887) (399,710) 51,177 - - - 356,800 497,174 140,374 - - - 18,035 2,131 (15,904) - - - 90,585 119,716 29,131 200,000 102,542 (97,458) - 84,482 84,482 1,039 1,039 300,500 62,454 (238,046) 200,000 103,581 (96,419) 765,920 765,957 37 3,122,309 3,119,678 2,631 - - - 407,000 406,738 262 - - - 327 - 327 - - - 28,373 - 28,373 - - - 15,000 13,843 1,157 1,357,397 727,257 630,140 115,000 112,740 2,260 - - - 18,004,200 5,816,926 12,187,274 11,385,012 1,201,940 10,183,072 21,692,209 9,469,925 12,222,284 12,742,409 1,929,197 10,813,212 (21,492,209) (9,366,344) 12,125,865 (11,976,489) (1,163,240) 10,813,249 77,900 78,815 915 - - - 10,092,100 10,092,100 - 453,000 489,374 36,374 (13,339,900) (13,339,900) (450,887) (399,710) 51,177 (3,169,900) (3,168,985) 915 2,113 89,664 87,551 (24,662,109) (12,535,329) 12,126,780 (11,974,376) (1,073,576) 10,900,800 21,007,799 21,007,799 12,332,080 12,332,080 $ (3,654,310) $ 8,472,470 $ 12,126,780 $ 357,704 $ 11,258,504 $ 10,900,800 $ (12,535,329) $ (1,073,576) 14,008 14,291 13,189,900 - $ 668,579 $ (3,059,285) 117 COLLIER COUNTY, FLORIDA COMBINING SCHEDULE OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCES BUDGET AND ACTUAL (NON -GAAP) MAJOR CAPITAL PROJECT AND NONMAJOR GOVERNMENTAL FUNDS FOR THE FISCAL YEAR ENDED SEPTEMBER 30, 2010 Revenues: Taxes Licenses, permits and impact fees Intergovernmental Charges for services Fines and forfeitures Interest income Special assessments Miscellaneous Total revenues Expenditures: Current: General government Public safety Physical environment Transportation Economic environment Human services Culture and recreation Debt service Capital outlay Total expenditures Excess (deficit) of revenues over (under) expenditures Other financing sources (uses): Bonds issued Premiums on bonds issued Payment to refund commercial paper Sale of capital assets Insurance proceeds Transfers in Transfers out Total other financing sources (uses) Net change in fund balances County-Wide Library Correctional Facilities Impact Fees INcmGAAP) Impact Fees (NonGAAP) Budget Actual Variance Budget Actual Variance 330,000 668,566 338,566 400,000 446,417 46,417 250,000 - (250,000) - - - 30,400 30,400 - 14,132 14,132 580,000 698,966 118,966 400,000 460,549 60,549 83,843 41,311 42,532 89,670 80,354 9,316 2,258,657 623,985 1,634,672 475,060 475,060 2,348,327 704,339 1,643,988 558,903 41,311 517,592 (1,768,327) (5,373) 1,762,954 (158,903) 419,238 578,141 1,171,300 (1,938,800) 1,171,300 (1,436,727) - 502,073 2,355,600 (1,952,900) 2,355,600 - (1,952,900) (767,500) (265,427) 502,073 402,700 402,700 (2,535,827) (270,800) 2,265,027 243,797 821,938 578,141 Fund balances at beginning of year 3,728,027 3,728,027 1,110,003 1,110,003 Fund balances (deficits) at end of year $ 1,192,200 $ 31457,227 $ 2,265,027 $ 1,353,800 5 1,931,941 $ 578,141 See accompanying independent auditors' report Reconciliation: Net change in fund balance, budgetary basis $ (270,800) $ 821,938 Change in fair value of Investments 4,915 2,403 Advances budgeted as transfers (1,171,300) (2,355,600) Unbudgeted funds - - Deferred revenues Net change in fund balance, GAAP basis $ (1,437,185) 118 Emergency Medical Services Impact Fees (Non -GAAP) Water Management (Non -GAAP) Budget Actual Variance Budget Actual Variance $ - $ $ $ - $ - $ - 165,000 190,524 25,524 55,900 - (55,900) - - - 2,000,000 2,664,656 664,656 - 13 13 10,316 10,316 174,100 78,302 (95,798) - - - 53,906 53,906 165,000 200,840 35,840 2,230,000 2,796,877 566,877 96,114 50,032 46,082 2,473,030 900,369 1,572,661 49,817 34,810 15,007 13,772,480 7,787,690 5,984,790 145,931 84,842 61,089 16,245,510 8,688,059 7,557,451 19,069 115,998 96,929 (14,015,510) (5,891,182) 8,124,328 1,174,600 1,174,600 - 8,093,200 8,093,200 - (1,441,800) (1,270,778) 171,022 (1,303,370) (1,302,486) 884 (267,200) (96,178) 171,022 6,789,830 6,790,714 884 (248,131) 19,820 267,951 (7,225,680) 899,532 8,125,212 944,721 944,721 8,361,030 8,361,030 $ 696,590 $ 964,541 $ 267,951 $ 1,135,350 $ 9,260,562 $ 8,125,212 $ 19,820 $ 899,532 1,477 14,544 (1,174,600) - 914,076 119 COLLIER COUNTY, FLORIDA COMBINING SCHEDULE OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCES BUDGET AND ACTUAL (NON -GAAP) MAJOR CAPITAL PROJECT AND NONMAJOR GOVERNMENTAL FUNDS FOR THE FISCAL YEAR ENDED SEPTEMBER 30, 2010 Parks Impact Districts (Non -GAAP) Road Impact Districts (Non -GAAP) Budget Actual Variance Budget Actual Variance Revenues: (13,506,156) (2,668,736) 10,837,420 (60,374,315) (7,533,743) 52,102,091 Fund balances at beginning of year Taxes $ - $ - 65,230,792 - Licenses, permits and impact fees 1,350,000 3,684,198 2,334,198 18,500,000 12,475,246 (6,024,754) Intergovernmental 147,000 91,417 (55,583) - - - Chargesforservices - - - - - - Finesandforfeitures - - - - - Interest income - 107,165 107,165 1,765,300 565,387 (1,199,913) Special assessments - - - - - - Miscellaneous 4,526 4,526 Total revenues 1,497,000 3,882,780 2,385,780 20,265,300 13,045,159 (7,220,141) Expenditures: Current: General government - - - - - Public safety - - - - - - Physical environment - - - - - - Transportation - - - 2,104,894 1,366,413 Economic environment - - - - - - Human services - - - - - - Culture and recreation 339,058 28,809 310,249 - - Debt service - - - - - Capital outlay 11,535,598 3,394,207 8,141,391 78,534,721 19,212,489 59,322,232 Total expenditures 11,874,656 31423,016 8,451,640 80,639,615 20,578,902 59,322,232 Excess (deficit) of revenues over (under) expenditures (10,377,656) 459,764 10,837,420 (60,374,315) (7,533,743) 52,102,091 Other financing sources (uses): Bonds issued - - - - - - Premiums on bonds issued - - - - - - Payment to refund commercial paper - - - - - - Sale of capital assets - - - - - - Insurance proceeds - - - - - - Transfersin - - - - - - Transfers out (3,128,500) (3,128,500) Total other financing sources (uses) (3,128,500) (3,128,500) Net change in fund balances (13,506,156) (2,668,736) 10,837,420 (60,374,315) (7,533,743) 52,102,091 Fund balances at beginning of year 16,101,356 16,101,356 65,230,792 65,230,792 Fund balances (deficits) at end of year $ 2,595,200 $ 13,432,620 $ 10,837,420 $ 4,856,477 $ 57,697,049 $ 52,840,572 See accompanying independent auditors' report Reconciliation: Net change in fund balance, budgetary basis $ (2,668,736) $ (7,533,743) Change in fair value of Investments 18,255 83,622 Advances budgeted as transfers - - Unbudgetedfunds - - Deferred revenues Net change in fund balance, GAAP basis S (2,650,481) $ (7,450,121) 120 - 213 213 - Law Enforcement - Road Construction (Non -GAAP) Impact Fees (Non -GAAP) - 3,293,800 3,293,800 - Budget Actual Variance Budget Actual Variance (15,893,085) (15,851,513) 41,572 (698,500) 273,366 971,866 $ 12,611,600 $ 12,895,300 $ 283,700 $ - $ - $ - - - - 270,000 333,341 63,341 15,097,232 9,220,976 (5,876,256) - - - 62,036 125,457 63,421 - - - 1,921,100 694,455 (1,226,645) - 28,532 28,532 1,404,841 978,424 (426,417) - 31,096,809 23,914,612 (7,182,197) 270,000 361,873 91,873 - - - 134,351 129,318 5,033 7,863,337 7,817,452 45,885 - - - 83,256,322 15,168,316 68,088,006 935,219 407,353 527,866 91,119,659 22,985,768 68,133,891 1,069,570 536,671 532,899 (60,022,850) 928,844 60,951,694 (799,570) (174,798) 624,772 - 213 213 - - - 6,209,399 6,209,399 - 3,293,800 3,293,800 - (22,102,484) (22,061,125) 41,359 (3,992,300) (3,020,434) 971,866 (15,893,085) (15,851,513) 41,572 (698,500) 273,366 971,866 (75,915,935) (14,922,669) 60,993,266 (1,498,070) 98,568 1,596,638 80,697,702 80,697,702 2,473,470 2,473,470 $ 4,781,767 $ 65,775,033 $ 60,993,266 $ 975,400 $ 2,572,038 $ 1,596,638 $ (14,922,669) $ 98,568 87,178 3,823 - (3,293,800) $ (14,835,491) $ (3,191,409) 121 COLLIER COUNTY, FLORIDA COMBINING SCHEDULE OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCES BUDGET AND ACTUAL (NON -GAAP) MAJOR CAPITAL PROJECT AND NONMAJOR GOVERNMENTAL FUNDS FOR THE FISCAL YEAR ENDED SEPTEMBER 30, 2010 Other Capital Projects INon -GAAP) See accompanying Independent audi tors' report Reconciliation: Net change in fund balance, budgetary basis Budget Actual Variance Revenues: - Unbudgetedfunds - Taxes $ - $ - $ - Licenses, permits and Impact fees 5,000 2,060 (2,940) Intergovernmental - - - Chargesforservices - - - Fines and forfeitures - - - Interest income 5,200 24,596 19,396 Special assessments 102,400 100,106 (2,294) Miscellaneous 500,000 500,000 Total revenues 112,600 626,762 514,162 Expenditures: Current: General government 732,144 179,952 552,192 Public safety 24,945 17,911 7,034 Physical environment 1,085,985 920,174 165,811 Transportation - - - Economic environment - - - Human services - - - Cultureandrecreation 680,560 455,036 225,524 Debt service - - - Capital outlay 2,193,233 889,297 1,303,936 Total expenditures 4,716,867 2,462,370 2,254,497 Excess (deficit) of revenues over (under) expenditures (4,604,267) (1,835,608) 2,768,659 Other financing sources (uses): Bonds issued - - - Premiums on bonds issued - - - Payment to refund commercial paper - - - Sale of capital assets - - - insurance proceeds - - - Transfers in 1,040,900 1,041,214 314 Transfers out (5,300) (3,506) 1,794 Total other financing sources (uses) 1,035,600 1,037,708 2,108 Net change in fund balances (3,568,667) (797,900) 2,770,767 Fund balances at beginning of year 4,989,153 4,989,153 Fund balances (deficits) at end of year $ 1,420,486 $ 4,191,253 $ 2,770,767 See accompanying Independent audi tors' report Reconciliation: Net change in fund balance, budgetary basis $ (797,900) Change in fair value of investments 3,697 Advances budgeted as transfers - Unbudgetedfunds - Deferred revenues Net change in fund balance, GAAP basis 122 Nonmajor Enterprise Funds EMERGENCY MEDICAL SERVICES — To account for the provision of emergency ambulance and paramedical services to users throughout the County. GOODLAND WATER — To account for the provision of potable water services to residents of Goodland. AIRPORT AUTHORITY — To account for the provision of landing facilities and the sale of fuel at the airports. COLLIER AREA TRANSIT — To account for the provision of public transportation throughout the County. COLLIER COUNTY, FLORIDA COMBINING STATEMENT OF NET ASSETS NONMAJOR ENTERPRISE FUNDS SEPTEMBER 30, 2010 Current assets: Total Emergency Collier Nonmajor Medical Goodland Airport Area Enterprise Services Water Authority Transit Funds Current assets: 107,918 1,803 240,461 Capital assets: 1,327,189 Cash, cash equivalents and investments $ 2,798,866 $ 375,874 $ 2,018,076 $ 102,193 $ 5,295,009 Receivables: 4,104,811 849,605 10,464,945 7,715,310 23,134,671 Total noncurrent assets 4,104,811 849,605 14,764,605 Trade, net 3,511,946 23,501 27,112 24,530 3,587,089 Interest 5,627 543 3,548 560 10,278 Unbilled revenue 561,442 11,047 - - 572,489 Due from other governments 7,424 - 495,593 999,302 1,502,319 Inventory 25,632 - 118,533 - 144,165 Restricted assets: - - 54,514 - 54,514 Cash, cash equivalents and investments 72,454 - 182,651 - 255,105 Total current assets 6,983,391 410,965 2,845,513 1,126,585 11,366,454 Noncurrent assets: 107,918 1,803 240,461 Capital assets: 1,327,189 Wages payable 835,030 Land and nondepreciable capital assets - - 4,299,660 6,001,418 10,301,078 Depreciable capital assets, net 4,104,811 849,605 10,464,945 7,715,310 23,134,671 Total noncurrent assets 4,104,811 849,605 14,764,605 13,716,728 33,435,749 Total assets 11,088,202 1,260,570 17,610,118 14,843,313 44,802,203 LIABILITIES Current liabilities Accounts payable 107,918 1,803 240,461 977,007 1,327,189 Wages payable 835,030 - 50,460 5,361 890,851 Due to other funds 244 - - 225,893 226,137 Due to other governments - - 1,830 65,579 67,409 Due to individuals 377,768 - - - 377,768 Compensated absences 542,505 - 46,911 6,492 595,908 Capital lease obligations 231,106 - 18,429 - 249,535 Liabilities payable from restricted assets: Retainage payable - - 54,514 - 54,514 Refundable deposits - - 18,303 - 18,303 Unearned revenue 72,454 109,834 182,288 Total current liabilities 2,167,025 1,803 540,742 1,280,332 3,989,902 Noncurrent liabilities: Compensated absences 232,502 - 20,105 2,782 255,389 Capital lease obligations 386,811 - 386,811 Total noncurrent liabilities 619,313 20,105 2,782 642,200 Total liabilities 2,786,338 1,803 560,847 1,283,114 4,632,102 NET ASSETS Invested in capital assets, net of related debt 3,486,894 849,605 14,746,176 13,716,728 32,799,403 Unrestricted 4,814,970 409,162 2,303,095 (156,529) 7,370,698 Total net assets $ 8,301,864 $ 1,258,767 $ 17,049,271 $ 13,560,199 $ 40,170,101 See accompanying independent auditors' report 124 COLLIER COUNTY, FLORIDA COMBINING STATEMENT OF REVENUES, EXPENSES AND CHANGES IN NET ASSETS NONMAIOR ENTERPRISE FUNDS FOR THE FISCAL YEAR ENDED SEPTEMBER 30, 2010 Operating revenues: Charges for services Miscellaneous Total operating revenues Operating expenses: Personal services Operating Depreciation Total operating expenses Operating loss Non - operating revenues (expenses): Operating grants and contributions Interest income Insurance reimbursement Interest expense Gain on disposal of capital assets Total non - operating revenues (expenses) Loss before contributions and transfers Capital grants and contributions Transfersin Transfers out Total transfers and contributions Changes in net assets $ 16,389,305 $ 401,700 $ 2,503,054 $ 1,145,270 $ 20,439,329 63,192 1,304 15,666 68 80,230 16,452,497 403,004 2,518,720 1,145,338 20,519,559 18,679,497 Total Emergency Collier Nonmajor Medical Goodland Airport Area Enterprise Services Water Authority Transit Funds $ 16,389,305 $ 401,700 $ 2,503,054 $ 1,145,270 $ 20,439,329 63,192 1,304 15,666 68 80,230 16,452,497 403,004 2,518,720 1,145,338 20,519,559 18,679,497 - 1,016,464 110,383 19,806,344 8,975,386 355,163 2,105,377 8,094,764 19,530,690 654,111 56,330 888,016 1,169,043 2,767,500 28,308,994 411,493 4,009,857 9,374,190 42,104,534 (11,856,497) (8,489) (1,491,137) (8,228,852) (21,584,975) 175,514 - - 4,246,994 4,422,508 35,991 3,370 25,175 4,528 69,064 23,403 - 6,228 16,014 45,645 (26,664) - (2,211) - (28,875) (44,715) (318,696) (38,868) (402,279) 1631529 3,370 (289,504) 4,228,668 4,106,063 (11,692,968) (5,119) (1,780,641) (4,000,184) (17,478,912) 80,500 - 749,328 345,795 1,175,623 10,716,600 - 557,500 4,083,200 15,357,300 (3,000) (76,200) (79,200) 10,794,100 (76,200) 1,306,828 4,428,995 16,453,723 (898,868) (81,319) (473,813) 428,811 (1,025,189) Net assets- beginning 9,200,732 1,340,086 17,523,084 13,131,388 41,195,290 Net assets - ending $ 8,301,864 $ 1,258,767 $ 17,049,271 $ 13,560,199 $ 40,170,101 See accompanying independent auditors' report. 125 COLLIER COUNTY, FLORIDA COMBINING STATEMENT OF CASH FLOWS NONMAJOR ENTERPRISE FUNDS FOR THE FISCAL YEAR ENDED SEPTEMBER 30, 2010 Cash flows from operating activities: Total Emergency Collier Nonmajor Medical Goodland Airport Area Enterprise Services Water Authority Transit Funds Cash flows from operating activities: 37,843 3,422 25,960 4,152 financing activities: Cash received for services $ 10,281,718 $ 398,829 $ 2,501,108 $ 1,152,880 $ 14,334,535 Cash payments for goods and services (2,233,870) (384,879) (1,969,933) (6,204,115) (10,792,797) Cash payments to employees (16,777,178) - (840,030) (96,854) (17,714,062) Cash payments for interfund services (2,959,847) (11,807) (316,085) (1,763,167) (5,050,906) Cash payments on refundable deposits - - (4,301) (179,042) (4,301) Net cash provided by (used for) operating activities (11,689,177) 2,143 (629,241) (6,911,256) (19,227,531) Cash flows from non - capital financing activities: (1,390,159) (3,647,210) Cash received from operating grants 125,984 - - 4,315,295 4,441,279 Cash transfers from other funds 10,716,600 - 691,350 9,333,938 20,741,888 Cash transfers to other funds (3,000) 76,200 (133,850) (5,405,164) (5,618,214) Net cash provided by (used for) non - capital financing activities 10,839,584 76200 557,500 8,244,069 19,564,953 Cash flows from capital and related 37,843 3,422 25,960 4,152 financing activities: Net cash provided by investing activities 37,843 3,422 25,960 Receipts from insurance reimbursements 23,403 - 6,228 32,154 61,785 Proceeds from disposal of capital assets 12,008 - - - 12,008 Proceeds from capital grants - - 373,017 38,520 411,537 Payments for capital acquisitions (968,565) - (1,495,225) (1,460,833) (3,924,623) Principal payments on leases (161,685) - (17,357) - (179,042) Interest and fiscal agent fees paid (26,664) - (2,211) - (28,875) Net cash used for capital and related financing activities (1,121,503) - (1,135,548) (1,390,159) (3,647,210) Cash flows from investing activities Interest on investments 37,843 3,422 25,960 4,152 71,377 Net cash provided by investing activities 37,843 3,422 25,960 4,152 71,377 Net decrease in cash, cash equivalents and investments (1,933,253) (70,635) (1,181,329) (53,194) (3,238,411) Cash, cash equivalents and investments, October 1, 2009 4,804,573 446,509 3,382,056 155,387 8,788,525 Cash, cash equivalents and Investments, September 30, 2010 $ 2,871,320 $ 375,874 $ 2,200,727 $ 102,193 $ 5,550,114 Cash, cash equivalents and investments $ 2,798,866 $ 375,874 $ 2,018,076 $ 102,193 $ 5,295,009 Cash, cash equivalents and investments - restricted 72,454 - 182,651 - 255,105 Cash, cash equivalents and investments, September 30, 2010 $ 2,871,320 $ 375,874 $ 2,200,727 $ 102,193 $ 5,550,114 See accompanying independent auditors' report. 126 (Continued) COLLIER COUNTY, FLORIDA COMBINING STATEMENT OF CASH FLOWS (CONTINUED) NONMAJOR ENTERPRISE FUNDS RECONCILIATION OF OPERATING LOSS TO NET CASH PROVIDED (USED FOR) OPERATING ACTIVITIES FOR THE FISCAL YEAR ENDED SEPTEMBER 30, 2010 Operating loss Adjustments to reconcile operating loss to net cash provided by (used for) operating activities: Depreciation expense Net changes in assets and liabilities: Trade receivable Due from other governments Prepaid costs Inventory Accounts payable Wages payable Due to other funds Due to other governments Due to individuals Compensated absences Refundable deposits Unearned revenue Total adjustments Net cash provided by (used for) operating activities Non -cash Investing, capital and financing activities: 654,111 56,330 888,016 1,169,043 2,767,500 (472,955) (4,175) Total Emergency Collier Nonmajor Medical Goodland Airport Area Enterprise Services Water Authority Transit Funds $ (11,856,497) $ 8,489 $ (1,491,137) $ (8,228,852) $ (21,584,975) 654,111 56,330 888,016 1,169,043 2,767,500 (472,955) (4,175) (11,379) 2,104 (486,405) 9,141 - - - 9,141 32,083 - - - 32,083 2,127 - (22,754) - (20,627) (81,134) (11,848) 10,879 160,261 78,158 67,126 - 5,870 658 73,654 (43) - - (16,787) (16,830) - (29,675) 98 - (29,577) 313 - - - 313 (43,419) - 1,700 2,317 (39,402) - - (4,301) - (4,301) (30) - (6,233) - (6,263) 167,320 10,632 861,896 1,317,596 2,357,444 5 (11,689,177) $ 2,143 $ (629,241) $ (6,911,256) _1_112,227,5311 The nonmajor enterprise funds experienced a non -cash investing loss due to a change in the fair value of non -cash and cash equivalents as follows: Emergency Medical Services $ 5,570 Goodland Water 501 Airport Authority 3,336 Collier Area Transit 416 Total $ 9,823 There were non -cash capital asset transfers in of $8 in the Collier Area Transit fund as capital assets with a historical cost of $731 and $723 of accumulated depreciation were transferred from governmental activities. There were non -cash capital asset transfers in of $48,937 in the Collier Area Transit fund as capital assets with a historical cost of $465,971 and $417,034 of accumulated depreciation were transferred from governmental activities. See accompanying independent auditors' report. 127 THIS PAGE INTENTIONALLY LEFT BLANK Internal Service Funds SELF - INSURANCE — To account for the self- insurance costs of providing coverage for property, general and vehicle liability. To account for the provisions of health benefits to Board and participating constitutional officer employees and their dependents. To account for payment of workers' compensation claims, in lieu of insurance. SHERIFF'S SELF - INSURANCE — To account for the provisions of health benefits to Sheriff employees and their dependents. To account for payment of workers' compensation claims, in lieu of insurance. FLEET MANAGEMENT — To account for fuel, oil, lubricants, repairs and maintenance of County vehicles and the use of certain County owned vehicles by County employees. INFORMATION TECHNOLOGY — To account for the costs of operating the County data processing facility and telephone communication system. COLLIER COUNTY, FLORIDA COMBINING STATEMENT OF NET ASSETS INTERNAL SERVICE FUNDS SEPTEMBER 30, 2010 Noncurrent assets: Capital assets: Land and nondepreciable capital assets - - - 40,977 40,977 Depreciable capital assets, net 252,371 - 13,097,635 9,571,260 22,921,266 Total noncurrent assets 252,371 13,097,635 91612,237 22,962,243 Total assets 27,329,044 13,677,767 14,880,499 10,612,226 66,499,536 LIABILITIES Current liabilities Accounts payable 149,179 - Sheriffs 574,248 1,221,890 Wages payable 50,514 - Self- Self- Fleet Information 394 - 4,301 Insurance Insurance Management Technology Total ASSETS 5,547,417 Compensated absences 80,627 - 106,831 178,105 Current assets: Total current liabilities 3,674,131 2,154,000 700,969 907,286 7,436 386 Cash, cash equivalents and investments $ 26,375,689 $ 12,812,794 $ 1,186,906 $ 993,037 $ 41,368,426 Receivables: Trade, net 138,022 - 5,706 - 143,728 Interest 41,774 - 988 1,952 44,714 Due from otherfunds - 864,973 24 5,000 869,997 Due from other governments 1,000 - 51 - 1,051 Deposits 518,267 - - - 518,267 Inventory 1,921 - 566,147 - 568,068 Prepaid costs - - 23,042 - 23,042 Total current assets 27,076,673 13,677,767 1,782,864 999,989 43,537,293 Noncurrent assets: Capital assets: Land and nondepreciable capital assets - - - 40,977 40,977 Depreciable capital assets, net 252,371 - 13,097,635 9,571,260 22,921,266 Total noncurrent assets 252,371 13,097,635 91612,237 22,962,243 Total assets 27,329,044 13,677,767 14,880,499 10,612,226 66,499,536 LIABILITIES Current liabilities Accounts payable 149,179 - 498,463 574,248 1,221,890 Wages payable 50,514 - 91,374 154,873 296,761 Due to other funds 394 - 4,301 60 4,755 Self- insurance claims payable 3,393,417 2,154,000 - - 5,547,417 Compensated absences 80,627 - 106,831 178,105 365,563 Total current liabilities 3,674,131 2,154,000 700,969 907,286 7,436 386 Noncurrent liabilities: Self- insurance claims payable 3,061,583 Compensated absences 34,555 Net pension obligation 290,738 Total noncurrent liabilities 3,386,876 Total liabilities 7,061,007 - - - 3,061,583 - 45,785 76,331 156,671 1,129,353 1,420,09] 1,129,353 45,785 76,331 4,638,345 3,283,353 746,754 983,617 12,074,731 NET ASSETS Invested in capital assets, net of related debt 252,371 - 13,097,635 9,612,237 22,962,243 Unrestricted 20,015,666 10,394,414 1,036,110 16,372 31,462,562 Total net assets $ 20,268,037 10,394,414 $ 14,133,745 $ 9,628,609 $ 54,424,805 See accompanying independent auditors' report 130 COLLIER COUNTY, FLORIDA COMBINING STATEMENT OF REVENUES, EXPENSES AND CHANGES IN FUND NET ASSETS INTERNAL SERVICE FUNDS FOR THE FISCAL YEAR ENDED SEPTEMBER 30, 2010 Sheriffs 131 Self- Self- Fleet Information Insurance Insurance Management Technology Total Operating revenues: Charges for services $ 36,547,675 $ 18,132,841 $ 7,267,559 $ 5,189,247 $ 67,137,322 Miscellaneous 6,253 12,836 339 19,428 Total operating revenues 36,553,928 18,132,841 7,280,395 5,189,586 67,156,750 Operating expenses: Personal services 1,126,285 - 1,976,475 3,699,524 6,802,284 Operating 39,867,692 18,018,456 5,301,317 1,441,296 64,628,761 Depreciation 18,655 552,529 1,500,538 2,071,722 Total operating expenses 41,012,632 18,018,456 7,830,321 6,641,358 73,502,767 Operating Income (loss) (4,458,704) 114,385 (549,926) (1,451,772) (6,346,017) Non - operating revenues (expenses): Interest income 251,534 84,135 7,413 16,257 359,339 Insurance reimbursement 1,359,394 - 2,306 1,172 1,362,872 Gain or (loss) on disposal of capital assets (71) - 3,444 (4,117) (744) Total non - operating revenues (expenses) 1,610,857 84,135 13,163 13,312 1,721,467 Income (loss) before contributions (2,847,847) 198,520 (536,763) (1,438,460) (4,624,550) Capital grants and contributions - - - 11,067,069 11,067,069 Transfers out (1,700,000) (1,700,000) Change in net assets (4,547,847) 198,520 (536,763) 9,628,609 4,742,519 Net assets - beginning 24,815,884 10,195,894 14,670,508 - 49,682,286 Net assets - ending $ 20,268,037 $ 10,394,414 $ 14,133,745 $ 9,628,609 $ 54,424,805 See accompanying independent auditors' report. 131 COLLIER COUNTY, FLORIDA COMBINING STATEMENT OF CASH FLOWS INTERNAL SERVICE FUNDS FOR THE FISCAL YEAR ENDED SEPTEMBER 30, 2010 Cash flows from operating activities: Cash received from other funds for services Cash received from employees for services Cash received from other governments for services Cash received from retirees for services Cash payments on behalf of retirees Cash payments for goods and services Cash payments to employees Cash payments for interfund services Net cash provided by (used for) operating activities Cash flows from non - capital financing activities: Cash transfers to other funds Net cash used for noncapital financing ctivities Cash flows from capital and related financing activities: Receipts from insurance reimbursements Proceeds from disposal of capital assets Payments for capital acquisitions Net cash provided by (used for) capital and related financing activities Cash flows from Investing activities: Interest on investments Net cash provided by Investing activities Net increase (decrease) In cash, cash equivalents and Investment Cash, cash equivalents and investments, October 1, 2009 Cash, cash equivalents and Investments, September 30, 2010 See accompanying independent auditors' report. Sheriffs Self- Self- Fleet Information Insurance Insurance Management Technology Total $ 31,906,153 $16,800,000 $ 6,931,886 $ 5,184,646 $ 60,822,685 4,624,707 - - - 4,624,707 - - 386,172 - 386,172 612,899 467,868 - - 1,080,767 (579,405) (348,089) - - (927,494) (40,657,420) (17,516,233) (5,301,212) (856,913) (64,331,778) (974,196) - (1,670,534) (2,878,609) (5,523,339) (197,382) (314,738) (421,741) (933,861) (5,264,644) (596,454) 31,574 1,027,383 (4,802,141) (1,700,000) (1,700,000) (1,700,000( (1,700,000) 1,359,394 - 2,306 1,172 1,362,872 - - 13,460 640 14,100 (5,400) (41,055) (50,463) (96,918) 1,353,994 (25,289) (48,651) 1,280,054 255,614 100,051 71653 14,305 377,623 255,614 100,051 7,653 14,305 377,623 (5,355,036) (496,403) 13,938 993,037 (4,844,464) 31,730,725 13,309,197 1,172,968 46,212,890 $ 26,375,689 $12,812,794 $ 1,186,906 $ 993,037 $ 41,368,426 132 (Continued) COLLIER COUNTY, FLORIDA COMBINING STATEMENT OF CASH FLOWS INTERNAL SERVICE FUNDS (CONTINUED) RECONCILIATION OF OPERATING INCOME (LOSS) TO NET CASH PROVIDED BY (USED FOR) OPERATING ACTIVITIES FOR THE FISCAL YEAR ENDED SEPTEMBER 30, 2010 Operating income (loss) Adjustments to reconcile operating income (loss) to net cash provided (used for) by operating activities: Depreciation expense Net changes in assets and liabilities: Trade receivable Due from other funds Due from other governments Deposits Inventory Prepaid costs Accounts payable Wages payable Due to other funds Compensated absences Self- insurance claims payable Net pension obligation Total adjustments Net cash provided by (used for) operating activities Non -cash investing, capital and financing activities: Sheriffs Self- Self- Fleet Information Insurance Insurance Management Technology Total $ (4,458,704) $ 114,385 $ (549,926) $ (1,451,772) $ (6,346,017) 18,655 - 552,529 1,500,538 2,071,722 (116,621) 18,231 (4,928) - (103,318) 13,789 (864,973) (24) (5,000) (856,208) (1,000) - 38,314 - 37,314 39,190 - - - 39,190 737 - (33,665) - (32,928) - - (23,042) - (23,042) 41,083 - 16,478 574,248 631,809 2,388 - 8,570 154,873 165,831 (9,932) - 4,301 60 (5,571) 23,053 - 22,967 254,436 300,456 (753,000) 33,000 - - (720,000) (64,282) 102,903 38,621 (805,940) (710,839) 581,500 2,479,155 1,543,876 $ (5,264,644) $ (596,454) $ 31,574 $ 1,027,383 $ (4,802,141) The internal service funds experienced a net non -cash investing gain due to a change in the fair value of non -cash and cash equivalents as follows: Self- Insurance $ 38,531 Sheriff's Self- Insurance 6,158 Fleet Management 905 Information Technology 1,843 Total $ 47,437 There were non -cash capital asset transfer sin of $11,067,069 in the Information Technology fund from governmental activities. See accompanying independent auditors' report. 133 THIS PAGE INTENTIONALLY LEFT BLANK Fiduciary Funds CLERK OF COURTS AGENCY FUND —To account for monies held in Trust by the Clerk of the Circuit Court prior to disbursement. SHERIFF AGENCY FUND —To account for monies held in a custodial capacity by the Sheriff. TAX COLLECTOR AGENCY FUND — To account for assets held by the Tax Collector prior to legal disbursement. DEPOSITS AGENCY FUND — To account for monies held by the County for businesses and individuals. PINE RIDGE AND NAPLES PRODUCTION PARK AGENCY FUND — To account for the receipt of special assessments and the payment of principal and interest on behalf of assessment holders. COLLIER COUNTY, FLORIDA COMBINING STATEMENT OF FIDUCIARY ASSETS AND LIABILITIES AGENCY FUNDS SEPTEMBER 30, 2010 Pine Ridge Clerk Tax and Naples of Courts Sheriff Collector Deposits Production Park Agency Fund Agency Fund Agency Fund Agency Fund Agency Fund Total ASSETS Cash, cash equivalents and investments $ 21,474,385 $ 450,824 $ 6,584,222 $ 3,121,028 $ 905,809 $32,536,268 Receivables: Interest - - - 4,099 1,299 5,398 Other - 15,974 - 13,783 29,757 Total assets $ 21,474,385 $ 450,824 $ 6,600,196 $ 3,125,127 $ 920,891 $32,571,423 LIABILITIES Due to other governments $ 1,471,636 $ 66,122 $ 5,098,571 $ - $ - $ 6,636,329 Due to individuals - 384,702 1,501,625 - - 1,886,327 Refundable deposits 20,002,749 - - 3,125,127 - 23,127,876 Due to special assessment holders - - - - 920,891 920,891 Total liabilities $ 21,4J4,385 $ 450,824 $ 6,600,196 $ 3,125,127 $ 920,891 $32,571,423 See accompanying independent auditors' report. 136 COLLIER COUNTY, FLORIDA COMBINING STATEMENT OF CHANGES IN ASSETS AND LIABILITIES AGENCY FUNDS FOR THE FISCAL YEAR ENDED SEPTEMBER 30, 2010 Balance Balance October 1 Additions Deductions September 30 Clerk of Courts Agency Fund Assets: Cash, cash equivalents and investments $ 18,806,440 $ 252,960,641 $ 250,292,696 $ 21,474,385 Total assets $ 18,806,440 $ 252,960,641 $ 250,292,696 $ 21,474,385 Liabilities: Due to other governments Refundable deposits Total liabilities Sheriff Agency Fund Assets: Cash, cash equivalents and investments Receivable: Other Total assets Liabilities: Due to other governments Due to individuals Total liabilities Tax Collector Agency Fund Assets: Cash, cash equivalents and investments Receivable: Other Total assets Liabilities: Due to other governments Due to individuals Total liabilities Deposits Agency Fund Assets: Cash, cash equivalents and investments Receivables: Interest Total assets Liabilities: Refundable deposits Total liabilities $ 1,547,662 $ 11,831,709 $ 11,907,735 $ 1,471,636 17,258,778 241,128,932 238,384,961 20,002,749 $ 18,806,440 $ 252,960,641 $ 250,292,696 $ 21,474,385 $ 437,552 $ 3,743,959 $ 3,730,687 $ 450,824 $ 437,552 $ 3,743,959 $ 3,730,687 $ 450,824 $ 66,814 $ 469,288 $ 469,980 $ 66,122 370,738 735,233 721,269 384,702 $ 437,552 $ 1,204,521 $ 1,191,249 $ 450,824 $ 6,525,291 $ 949,196,344 $ 949,137,413 $ 6,584,222 17,770 2,552,004 2,553,800 15,974 $ 6,543,061 $ 951,748,348 $ 951,691,213 $ 6,600,196 $ 5,049,175 $ 911,220,632 $ 911,171,236 $ 5,098,571 1,493,886 47,934,182 47,926,443 1,501,625 $ 6,543,061 $ 959,154,814 $ 959,097,679 $ 6,600,196 $ 3,198,679 $ 576,155 $ 653,806 $ 3,121,028 4,463 4,099 4,463 4,099 $ 3,203,142 $ 580,254 $ 658,269 $ 3,125,127 $ 3,203,142 $ 399,935 $ 477,950 $ 3,125,127 $ 3,203,142 $ 399,935 1 477,950 $ 3,125,127 (Continued) 137 COLLIER COUNTY, FLORIDA COMBINING STATEMENT OF CHANGES IN ASSETS AND LIABILITIES ALL AGENCY FUNDS FOR THE FISCAL YEAR ENDED SEPTEMBER 30, 2010 Balance Balance October Additions Deductions September 30 Pine Ridge and Naples Production Park Agency Fund Assets: $ 6,663,651 $ 923,521,629 $ 923,548,951 $ 6,636,329 Cash, cash equivalents and investments $ 822,683 $ 891,316 $ 808,190 $ 905,809 Receivables: 20,461,920 241,528,867 238,862,911 23,127,876 Interest 4,207 1,299 4,207 1,299 Other 19,269 13,783 19,269 13,783 Total assets $ 846,159 $ 906,398 $ 831,666 $ 920,891 Liabilities: Due to special assessment holders $ 846,159 $ 906,398 $ 831,666 $ 920,891 Total liabilities $ 846,159 $ 906,398 $ 831,666 $ 920,891 Total - All Agency Funds Assets: $ 6,663,651 $ 923,521,629 $ 923,548,951 $ 6,636,329 Cash, cash equivalents and investments $ 29,790,645 $ 1,207,368,415 $ 1,204,622,792 $ 32,536,268 Receivables: 20,461,920 241,528,867 238,862,911 23,127,876 Interest 8,670 5,398 8,670 5,398 Other 37,039 2,565,787 2,573,069 29,757 Totalassets $ 29,836,354 $ 1,209,939,600 $ 1,207,204,531 $ 32,571,423 Liabilities: Due to other governments $ 6,663,651 $ 923,521,629 $ 923,548,951 $ 6,636,329 Due to individuals 1,864,624 48,669,415 48,647,712 1,886,327 Refundable deposits 20,461,920 241,528,867 238,862,911 23,127,876 Due to special assessment holders 846,159 906,398 831,666 920,891 Total liabilities $ 29,836,354 1,214,626,309 $ 1,211,891,240 $ 32,571,423 See accompanying independent auditors' report 138 Component Units COLLIER COUNTY HOUSING FINANCE AUTHORITY — The authority was established for the purpose of stimulating the construction of residential housing for low and moderate income families through the use of public financing. COLLIER COUNTY HEALTH FACILITIES AUTHORITY — The authority was established for the purpose of assisting health facilities in the acquisition, construction and financing of projects within the County. COLLIER COUNTY INDUSTRIAL DEVELOPMENT AUTHORITY — The authority was established for the purpose of facilitating projects that promote economic growth and opportunities for employment in Collier County. COLLIER COUNTY EDUCATIONAL FACILITIES AUTHORITY — The authority was established for the purpose of assisting institutions of higher education in the construction, financing and refinancing of projects. COLLIER COUNTY, FLORIDA COMPONENT UNITS COMBINING STATEMENT OF NET ASSETS SEPTEMBER 30, 2010 See accompanying independent auditors' report. 140 Housing Health Industrial Educational Finance Facilities Development Facilities Authority Authority Authority Authority Totals ASSETS Cash, cash equivalents and investments $ 283,120 $ 166,609 $ 7,264 $ 2,439 $ 459,432 Total Assets $ 283,120 $ 166,609 $ 7,264 $ 2,439 $ 459,432 NET ASSETS Net assets- unrestricted $ 283,120 $ 166,609 $ 7,264 $ 2,439 $ 459,432 Total Net Assets $ 283,120 $ 166,609 $ 7,264 $ 2,439 $ 459,432 See accompanying independent auditors' report. 140 COLLIER COUNTY, FLORIDA COMPONENT UNITS COMBINING STATEMENT OF ACTIVITIES FOR THE FISCAL YEAR ENDED SEPTEMBER 30, 2010 FUNCTIONS /PROGRAMS Expenses Program Revenues Fees, Fines and Charges for Services Net (Expense) Revenue and Changes in Net Assets Governmental Activities Industrial Development Authority $ 194 $ 3,948 $ 3,754 Health Facilities Authority - - - Housing Finance Authority 30,662 - (30,662) Educational Facilities Authority 178 - (178) Total $ 31,034 $ 3,948 (27,086) General revenues: Interest income 371 Total general revenues 371 Change in net assets (26,715) Net assets - beginning 486,147 Net assets • ending $ 459,432 See accompanying independent auditor's report. 141 THIS PAGE INTENTIONALLY LEFT BLANK STATISTICAL SECTION (UNAUDITED) Statistical schedules differ from financial statements because they usually cover more than one fiscal year and may present non - accounting data. These schedules reflect social and economic data, and financial trends of Collier County, Florida. CONTENTS FINANCIAL TRENDS These schedules contain trend information to help the reader understand how the government's financial performance and wellbeing have changed over time. PAGE Net assets by component 144 Change in net assets 145 Governmental activities tax revenues by source 148 Fund balances of governmental funds 149 Changes in fund balance of governmental funds 150 REVENUE CAPACITY These schedules contain information to help the reader assess the Country's most significant local revenue source, the Property Tax. Assessed value and estimated actual value of taxable property 152 Property Tax Rates —All direct and overlapping governments 153 Principal Taxpayers County -wide 154 Property Tax levies and collections 155 DEBT CAPACITY These schedules present information to help reader assess the affordability of the County's current levels of outstanding debt and the County's ability to issue additional debt in the future. Ratios of outstanding debt by type 156 Ratios of general bonded debt outstanding 157 Legal debt margin information 158 Direct and overlapping governmental activities debt 158 Pledged- revenue coverage 159 DEMOGRAPHIC AND ECONOMIC INFORMATION These schedules offer demographic and economic indicators to help the rear understand the environment within which the County's financial activities take place. Demographic and economic statistics 160 Principal employers 161 OPERATING INFORMATION These schedules contain service and infrastructure data to help the reader understand how the information in the County's financial report relates to the services the County provides and the activities it performs. Full -time equivalent County employees by function 162 Operating indicators by function 163 Capital Asset statistics by function /program 164 Sources: Unless otherwise noted, the information in these schedules is derived from the comprehensive annual financial reports for the relevant year. The County implemented GASS 34 for fiscal year 1001. Schedules presenting government -wide information include information beginning in that fiscal year. N a C C G W N O O J t r O a 0 d N -O Z v W � Z � N o� u Z E m a a a v v v a a a a a a « H N « d q d d N o a o a o d c a c a a c w c y c c c ID y m d t✓, .c y a m . a n ¢ J m K J F 6 C J F 144 of OI �O p� N cl p1 N m lD m 01 O ro t0 �O .Mi N N N m aNp} ry m Vl d ti Vl n N N N V! N N N N N Y1 O O V1 Vf VppI n $ N lD Onp N N N H O M O n O1 m d n gvmi o� e nry-I N �y` N N N N N yN N Ny b N pp M V O O m O Iq 10 In M N IG d m m n Cp 'i N 1f1 m m N n O M N t\ O vl .d9 N m N~ n Omp lD O 0 N d N y Vl N H N N H d n N IO d m m vl m O m 'I 10 m N b n d O Ill m V V1 N N d M M N Ot LO m d m v ni ai �o of g W a n g a ry gi N H V� Vf V� Vf m mp N m N n b 1l1 O p n O d O N n N % C M d d OOd11 N N IO N Vf W IO VI W n rl W m Vf O m 0 N ry n 8 0 php N m N N N M O ei '1 'I IO 'I m Vf IO m O1 IO N 01 n d d ry O 'I d M m n m In o n o CI n In 01 m O an d m88 m ay m m 8 m N M Q m n VI N d� N fl 'i N H V1 V1 N V1 N m N 'I �p of vl 'I rl m n N n I'l'n o o vO1i �iO+ n n d .n-I n m O1 m o n Irryi e ti e m m m ry ry n lc rvll o ry ry � � m m ry d a m n m d m ry M w MN m .i of ti rvi 'i w ro g r ry 1A V1 N N Vl N M I!1 n e1 O rl W I O Y1 N V1 n n I/y C O r n % ll M N d d I/1 p H N VI lmO M em1 m p m N M V N .i fi rl N V1 VI V1 N V1 N a a a v v v a a a a a a « H N « d q d d N o a o a o d c a c a a c w c y c c c ID y m d t✓, .c y a m . a n ¢ J m K J F 6 C J F 144 m O N 0 0 N In w w m w m n b n n 00 N rl N b O N M N b rl N W N N b INII b N � e vi vi < vi ni b e4 M N N n O O O Ill O b N rl 01 01 Q '1 Vf ei rl M M Ill V W 1� w M M N N O rl M -4m"88 N V1 N N O m O ti Q b O1.amam''n o � aG o vi vi m O m Q M M N M ti Q .1 w In O m n N N m m O n O w w ti In Itny n n O m Lll Q Q N Ill N o w o In m b g ry w w m m n N m Q N O N M Vf M m N b b N rl n n N 1l1 T N b r M 0 0 m r c a n N � Q m b m .-I n In In Q ry b w m Q 0 of Io Io o ai I+i II v n x v a w v !' ) Y) q W - qE c o g Y o w w 41 C O w q C 4 m g t q y q d C p N O g q C c n c a• w m c > YY W x O H W 145 e1 rl IY1 Q O M C Ill N 'I O1 tl1 y m c O U N M C N W C In ry .w m n M O t+i M 01 b M b N N O N ti Q N N N M n W Q b w m N at Q m O N m ei Q N n o Q w b m m o In Q b n N !ll b N N Vf n M N Q n m m O N n m m 0 01 N Q n n r1 n .. b m Q N mow N O N w r b w m Vf O of m O O b w m m b M .-I b N Q Vf Q Vf O V1 n m m m m O O m W W N v1 m m N b M e4 lO N l0 N n n Q m N Q m b n Q o ni � v of oo ni � o N ry n M a v �v v a c N w w n � a v c N S yq d V C a 7 C V d q � q Q E2 C C g 3 r 0 m � « v_ on N `w a u q q « « j 3 H Q w 0 0 F- v W Q C o LL � Y p C yJ N ; I N Y 7 Z L - LL 'h v M cc Z W .... W Q Z J S F 7 y C p u U u g E m m O N 0 0 N In w w m w m n b n n 00 N rl N b O N M N b rl N W N N b INII b N � e vi vi < vi ni b e4 M N N n O O O Ill O b N rl 01 01 Q '1 Vf ei rl M M Ill V W 1� w M M N N O rl M -4m"88 N V1 N N O m O ti Q b O1.amam''n o � aG o vi vi m O m Q M M N M ti Q .1 w In O m n N N m m O n O w w ti In Itny n n O m Lll Q Q N Ill N o w o In m b g ry w w m m n N m Q N O N M Vf M m N b b N rl n n N 1l1 T N b r M 0 0 m r c a n N � Q m b m .-I n In In Q ry b w m Q 0 of Io Io o ai I+i II v n x v a w v !' ) Y) q W - qE c o g Y o w w 41 C O w q C 4 m g t q y q d C p N O g q C c n c a• w m c > YY W x O H W 145 e1 rl IY1 Q O M C Ill N 'I O1 tl1 y m c O U N M C N W C In ry .w m n M O t+i M 01 b M b N N O N ti Q N N N M n W Q b w m N at Q m O N m ei Q N n o Q w b m m o In Q b n N !ll b N N Vf n M N Q n m m O N n m m 0 01 N Q n n r1 n .. b m Q N mow N O N w r b w m Vf O of m O O b w m m b M .-I b N Q Vf Q Vf O V1 n m m m m O O m W W N v1 m m N b M e4 lO N l0 N n n Q m N Q m b n Q o ni � v of oo ni � o N ry n M a v �v v a c N w w n � a v c N S yq d V C a 7 C V d q � q Q E2 C C g 3 r 0 m � « v_ on N `w a u q q « « j 3 H Q w 0 0 F- Q D 0 YLL r Z W J O u F W h Q W Z Z_ W z Q x V 0 W Z F Z 0 Z OC W Y Q LL W Z z 'I m C .c 7 O 0 a M u m C IO 0 O L Y C Y � v h � N ry a � x � v C 0 L 146 m m m n W H " 0 0H u ' M 10 w W- n ro m rl O M M l0 M M M V1 N N M ei N Ill W a N rl a N O tD N Ill M O a H a n H a m m N Ol m 0 O Vl M M N N 'i O H H lD rl rl N N O rl N N N a0 H M H lD 0p m ID ill W O N T Vl m Vpf 10 00 W N M O b t W V .Ni 1 O Onl --1 T lm0 Iq O~1 l IO O m IO IO tYi a N O Vl O1 W O N n l0 V1 a a IO n N .... N lA n n N tp a 0 0 m .� 00 00 H O N m a0 M vl tD N Vl '1 r-V \O n e'1 Vf m n' O m a Ill a H N Ol m to 01 a n In al V1 M O m H rl 01 m b N rl M m N O N H m 'i Vf N m N n O Ol VVW l m m Vo lM O Il0 O 1 � Vf l m 00 a Vl N N C l H n m p a H H O B n ry H m o m m� ti h m n m w oo N oo m m m a� oo m a w m e n n a m n m Io Io � oo H vl H ry m o+ m m n a N p H In n au m o a o n O M N N fYl O o n a co m H a o a N m N a m N N n In N N Ol m p m a ry a T N m M m H N m N oHp = N N O m ry a V1 m n101 H a O m m n n Ul Ill n ry 1!1 m m m o m m� o -.1 � n m Op ry m a not ao .1"+ a' a H N O N Ol M H M CO H a N_ N ti h w vl Io m H N m a o In n a n m m m m o H m Ic a m N a o o ry Ci m a n In m M m t0 ul N a vl m a vl N m a o a Ill o H m m o a V vl ao n to ri m oo n o ry H o lu m 'i Ic v ri vi Ic m o p m H N N E O m H N WH M N O 0 N v LT of n o H o o ao n m n N m H H vl n to m .c VI a O m N a 10 10 N N Ill O W M a ID N m m Ol M Vl N O1 H W lD p1 W N Ol M H N N H Cri a 10 W m Ol H pNp IV H IYl N m M H N N O O M H H H N N m M N � H vl Ol n n W Wiwi N l0 H a ✓1 sW w w Qm w n Ill Cl M W N 0 w n O 0 l H a a M I Vl 10 00 Vl l0 o ff '1 V1 H M D a O m m Ol m M O m H H N I H N M m .... N H d > d > N C C d > j � C d d 7 m O O O O A X a 7 2 d O O Om a ¢ 2 P? c v v E iJ d N C = V C C 3 y C O W V V O c i «' H h0 « y °0 r vdi dC .c m d w eo N o 1p it m« d w n¢« c m E a d E m E « a d A= o N 3 C m c E- c m di m m a oa '" y s o. = E d a n a si g y q q G r 3 I0 a f w n 0 o v o�i o a'ID ,°o z(Dm� a` 146 W V m m l yy m. N M' n 0 m m m-- - m m W of m. a0 m" V O am n m O n o maw H n m t0 rl W C( '1 O n V 0 n n m W 'p1 m D N Iz C O C W z '« N N O O Oi N ' =O t LL N W h N ap Y Z z W O v n m M z Y V b J Ov VI V O W ON1 N m rL S N -a ey N N W N t0 n N Vf m V1 N m ro n V1 N N O p n N u -C rl a V Y1 m m m n o m O � � m m vi � w ec ^� z 4 E W O1 O I m O o ry N N M v N W V N d m C N L u u a w w E .NV-. E m Ti y v w G v ai N'-> o N a x EE v L o a m o u x K 'c 0 o E c E v o v Q w x« i m Z c v q= 9 tr v :' �'� c m o v c C C d d( vl F U m e ui n q m C C A N m q N C N 1 H 147 m m l yy m. N M' n m m m m-- - m m of m. a0 m" V O am n m O n o maw n m t0 rl W C( '1 O n V 0 n n m W 'p1 m 00 w O W W n Lr N L6 g '1 N v N N O O Oi N W h N ap pp N n M M t0 I Iii L L - y o umi ul .m. m o m m M w vl h m N m V b C n N N ON1 N N N N N N ey N N V1 N M n M 0 ID M M N' T n N Vf m V1 N m ro n V1 N N O n N -C rl a V Y1 m m m n o m O � � m m vi � w ec ^� O cr N Ili ry N O W O1 O I m O o ry N N M 'I N N V! H N N n pt C� Ot Vf N N' LIl n' rl tD N O N N C LO CO ll1 Ill n Of V M N l0 O l0 lz m m 0 N a Lq 0 .1 n a n m <D � C° w 0 n O N O n W M O O 0 O 0 of O Vl b tD of N N VI Vf Vf O m N m N O w N' Ol O vl CM1 a Q n O n v N n N V' '-I CO tD N a 'i Cl O W b m 1l1 p N O b b ei V M N N m O m Oi Oi � o ni Ill m 00 Clt I+i ri � of o Iq o w l0 o M r Vf to � N v m oo m a ry ri m In ry a o lc N a m$ m Ill Il l0 N Ill N m ll N W t} N N m n n N 0 O Vf " N n m m N M L'i Vl m N O OJ m M W Vl O'J 'i N tD r M N m M CO N n N O O M e-1 m .i a " a ~ N m m O w N O N N N V! N Yl O W .-I W O N w 0p w 0 n W e m w N O m m N N n O m n N m lD n m 'i W C O m O N H N N to O O m of .y n of b m �O N of .i �p N a O o0 a0 m N n Q N l0 M m O m V1 m N r ll Ill y n N m m O O N N Uf 11 m I I n n 'i CO N N N N m VI n n m V Vl N' m m m CO m b Vf m N rl W rl N Yl M Vf b N ll O lU M Yl N N a Cl M a m w o f0 � O N m 1l1 N a m W N O N 0 N N N N N d m C N L u u a w w E .NV-. E m Ti y v w G v ai N'-> o N a x EE v L o a m o u x K 'c 0 o E c E v o v Q w x« i m Z c v q= 9 tr v :' �'� c m o v c C C d d( vl F U m e ui n q m C C A N m q N C N 1 H 147 COLLIER COUNTY, FLORIDA GOVERNMENTAL ACTIVITIES TAX REVENUES BY SOURCE LAST NINE FISCAL YEARS (amounts expressed in thousands) (unaudited) Fiscal Property Gas Sales Tourist Other Year Tax Tax Tax Tax Taxes (1) Total 2002 $ 147,753 $ 17,333 $ 26,611 $ 8,184 $ 4,893 $ 204,774 2003 174,291 17,731 27,846 8,377 5,604 233,849 2004 213,353 19,887 31,323 9,720 5,796 280,079 2005 237,452 20,127 32,949 10,484 7,089 308,101 2006 293,240 20,028 34,671 13,629 9,142 370,710 2007 345,054 19,598 32,568 14,228 8,754 420,202 2008 327,245 18,860 30,004 14,796 4,051 394,956 2009 313,290 18,456 26,779 12,345 12,241 383,111 2010 299,389 18,415 26,927 12,857 10,039 367,627 (1) Pursuant to the Uniform Accounting System direction from the State of Florida, the Communications Services Tax was shown with fees, fines and charges for services for fiscal year 2008, this changed in 2009. 148 o ry ry n a Z m o LL _ � C c m aria n u°i m m m N p rl� oo Q IZ N O is a ni of p N N 0, 7 Vl Lu 0 2 W m c w a E w LL � J uiV O _ ' p Y i N a Z cr W a H W c yl a Z Cc 0 N Q W m t Q V W O v V Z Z a J to N t0 � "O C Q N J QV Z O V LL O N Z E N W z Z a x V N V •i n Y1 N N N tD n N n lU Vf N M M M t0 N H Cl N OD 00 N M N O Vl M N r M C v In In m 01 O O O N rl 1l1 lD O1 N rl p O N l0 M Vf N M Ol N n V N N lD CO N V1 M t0 O rl O w CO N N a O1 lO m ao In m o W< o Q m I .i to co M m In In n m In n ul Il m n a a p a I vl O Vl M a0 b IO V N I 01 CO N W N W lD V M V Ic ai m I I o vi a oo n m In In ry ry N ei .i n n 6 m w `f `" r,: m o m n m N m v°p�o ti m° m m ry L L .'ii u00i l°� .Mi O lD V n t0 'i N n l0 O V1 l0 01 CO lO O1 N W lU O] N O n l0 N N 01 0 w rl N N n R1 m ao In m o W< o Q m to o .i to co M m In In n m In n ul Il m n a a p a of m vl O Vl M a0 b IO V N O 0p N N p Yl N N O N 01 CO N W N W lD V M V Ic ai m I I o vi a oo n m In In ry ry N ei .i n ul 6 m w `f `" r,: m 14 °m rq N m v°p�o ti m° m m ry Oa O yO Vl t(1 O O 01 LO 01 M 01 m m W N m IV1 O 0 l0 V rl V m m Ot M M Y1 rl N Ill N 6 O M Ip 01 n O N ei 0 0 N ill .y rl V1 N O IO Vl Ol M N N b M N V1 M Vf V1 W m V1 N Q a lD 'I M Ol Il1 Ol Ol N n 01 Ot M M N .i N n ID M N O aD N O W Gl n n n 00 .ni 01 Vl Vf H h t0 t+l M O tD N O1 .-i M n Ol M O .i m O N VI G M Ol p M "I O W m e-I N N N N w N v v w m N V C « 6 E c c i c E o v � c v E w � a co « a a y N N E o o .c o v w v y$ N o c w m y w �° w 9 v a ',� m > .moo, .. d E c v Z a o w N o a u o m N y_ `> c in � H W V O V 150 I I I I M Ol tD n N N O n N M N O V1 r'I n Ill W '1 1p CO N W N W lD V M V w N cri M O N N M Vl O t0 n N M rl vl 01 6 m w `f `" r,: m 14 °m rq o m a o m m v°p�o ti m° m m ry N l0 N N O1 tD O N n a W M V M Ol Vl tO O fl 01 W In Vl m w ro lU m 0 0 Iii o a to n In m to R c ao cq cl 0o n m ry Ic oo e o o+ m o n O n O M M N O O IO Vl Ol M N N b M N V1 M V1 Il1 n V M N 00 01 n p N N M V N 00 O M vl .i N n N O O M M ID lO m V O Ol ry ap .-i of n N ul � ti sT CO Ill W N ei N N O n <T W O1 O1 N M M "I O M 01 O n N n r-I W 'i W ID M b H .i N N O b Ill O W V1 Ol Vl Vl ti N 'I rl Vl M O "1 N e-1 n W rl 1p w M V N tD m N ei 'I O1 tp N� 'i N M Cr N n N M v1 .-I N IO N V O U1 N O lU W O N Ol n V n N tO 01 O ei Ol 00 N N N M O ap O O ri n n N N lO n M 0 M Vl O1 N n M M M a O 01 L rl N Vl N N W r-1 fIl D] 1p n Ill y N tp Ll1 m N Ill O1 M M N OD N 01 00 lC O N N M M N IO 00 M N v v w m N V C « 6 E c c i c E o v � c v E w � a co « a a y N N E o o .c o v w v y$ N o c w m y w �° w 9 v a ',� m > .moo, .. d E c v Z a o w N o a u o m N y_ `> c in � H W V O V 150 Z LL J Z W W C yi 7 Z ♦ 'O Q Z om mN C W Z > O u o OJ LL l7 N O c �o°C "- �v W > h O V Z ` a uv W Q m W {L f0 y J -0 C 00 Z Lo o Z E LL H 0 V ?4v N r W z Z a U d Y m S N O N a m ry m m .i n m O N lD Vq o0 Vf �n 1� W n (Yl Oi Vf a m m N O V1 N N l0 n N n �O O N 01 N O O U�1 � Ill O m N voi ,r ,r �n ti .y m m a in m m m N M N N W O m N lD ai � vi ry 'i m h ca{ H o vi n a o N m n Ot .n n m N d o m r v M n N W m ry n o o Iii n m N N VOf V C O O U�1 � Ill O m N voi ,r ,r �n ti .y m m a in m m m N M N N W O m N lD N rl b N 0 N n G �1 r C I c m .ai N ♦i C M m ti N h ca{ O ti M N W of Ot O M n N W � N n N VOf V C C N $ N a° 0 v W m a? ai vi c ro m O � � V � m c r c a N N rl b N 0 N n G �1 r C I c m .ai N ♦i C M m ti 151 N n � V C C V N a° 0 v W m c m O � � V � m c r c a C N Z a n y m w c a c y N a« c m y 3 N o N w '- w w C w 9 .10. O 9 m o w F cc a o. i g q z 151 COLLIER COUNTY, FLORIDA ASSESSED VALUE AND ESTIMATED ACTUAL VALUE OF TAXABLE PROPERTY LAST NINE FISCAL YEARS (amounts expressed in thousands) (unaudited) Property is assessed as of January 1, and taxes based on these assessments are levied and become due on the following November 1. Therefore, assessments and levies applicable to a certain tax year are collected in the fiscal year ending during the next succeeding calendar year. 'The basis of assessed value required by the state is 100% of actual value. Source: Property Appraiser Recapitulation Report 152 Total Estimated Assessed Fiscal Year Centrally Less: Total Taxable Direct Actual Value as Ended Residential Personal Assessed Tax Assessed Tax Taxable Percentage of September 30, Property Property Property Exempt Value Rate Value Actual Value 2002 $ 36,089,299 $ 1,651,435 $ 110 $ 4,345,843 $ 33,395,001 13.0881 $ 37,740,844 100% 2003 42,635,220 1,770,370 113 4,915,279 39,490,424 12.8418 44,405,703 100% 2004 49,712,793 1,802,265 117 5,529,447 45,985,728 12.6800 51,515,175 100% 2005 55,370,248 1,820,777 127 5,928,339 51,262,813 12.3711 57,191,152 100% 2006 66,375,040 1,956,646 143 6,890,007 61,441,822 12.2586 68,331,829 100% 2007 82,909,061 2,156,726 202 8,023,791 77,042,198 11.5139 85,065,989 100% 2008 88,819,491 2,321,048 226 8,575,874 82,564,891 10.7366 91,140,765 100% 2009 86,949,935 2,430,996 202 10,718,166 78,662,967 10.3120 89,381,133 100% 2010 77,359,174 2,444,323 202 9,826,950 69,976,749 10.9869 79,803,699 100% Property is assessed as of January 1, and taxes based on these assessments are levied and become due on the following November 1. Therefore, assessments and levies applicable to a certain tax year are collected in the fiscal year ending during the next succeeding calendar year. 'The basis of assessed value required by the state is 100% of actual value. Source: Property Appraiser Recapitulation Report 152 COLLIER COUNTY, FLORIDA PROPERTY TAX RATES - ALL DIRECT AND OVERLAPPING GOVERNMENTS LAST NINE FISCAL YEARS (unaudited) Basis for property tax rates is 1 mill per $1,000 of assessed value. Property is assessed as of January 1 and taxes based on those assessments are levied according to the tax rate in effect that tax year and become due on November 1. Therefore, assessments and levies applicable to a certain tax year are collected in the fiscal year ending during the following calendar year. Sources: Property Appraiser Recapitulation Report. Collier County 2010 Annual Budget 153 Collier County Other Special Debt County Fiscal General Revenue Service School Independent Year Fund Funds Funds Total District Districts Total 2002 3.8772 0.6670 0.0256 4.5698 7.1370 1.3813 13.0881 2003 3.8772 0.6767 0.0215 4.5754 6.9110 1.3554 12.8418 2004 3.8772 0.9226 0.0000 4.7998 6.5240 1.3562 12.6800 2005 3.8772 0.9177 0.0000 4.7949 6.2200 1.3562 12.3711 2006 3.8772 0.9161 0.1500 4.9433 5.9730 1.3423 12.2586 2007 3.5790 0.8470 0.2226 4.6486 5.5250 1.3403 11.5139 2008 3.1469 0.7362 0.2233 4.1064 5.3510 1.2792 10.7366 2009 3.1469 0.7528 0.2249 4.1246 4.9090 1.2784 10.3120 2010 3.5645 0.7225 0.1366 4.4236 5.2390 1.3243 10.9869 Basis for property tax rates is 1 mill per $1,000 of assessed value. Property is assessed as of January 1 and taxes based on those assessments are levied according to the tax rate in effect that tax year and become due on November 1. Therefore, assessments and levies applicable to a certain tax year are collected in the fiscal year ending during the following calendar year. Sources: Property Appraiser Recapitulation Report. Collier County 2010 Annual Budget 153 COLLIER COUNTY, FLORIDA PRINCIPAL TAXPAYERS COUNTY -WIDE 2010 TAX ROLL (amounts expressed in thousands) (unaudited) Amounts for taxpayers with similar names have not been combined. Source: Property Appraiser's taxpayer listing in order of taxes levied. Property Appraiser Recapitulation Report. ' Century Link was Sprint in 1998 154 2010 2001 Property Percent of Property Percent of Taxes Total Taxes Total Owner/Taxpayer Levied Rank Taxes Levied Levied Rank Taxes Levied Florida Power & Light Company $ 2,537,374 1 0.31% $ 1,712,165 1 0.44% HHR Naples LLC 1,492,811 2 0.18% - - ' Century Link 1,156,394 3 0.14% 1,645,999 2 0.43% City National Bank of Miami 925,737 4 0.11% 1,152,193 4 0.30% Lee County Electric 827,470 5 0.10% - - Naples HMA, Inc. 812,779 6 0.10% - - The Moorings, Inc. 779,467 7 0.10% - - Coastland Center Joint Venture 759,221 8 0.09% 1,117,938 5 0.29% Wal -Mart Stores East LP 757,599 9 0.09% - - Collier HMA Inc 749,390 10 0.09% - - HMC BN LTD Partnership - - 1,538,867 3 0.40% Collier Development Corporation - - 803,532 6 0.21% Marco Island Utilities - - 702,886 7 0.18% Lutgert TR, Raymond L - - 646,527 8 0.17% CC- Naples Inc - - 617,213 9 0.16% Naples Golf & Beach Club Inc - - 575,325 30 0.15% Total $ 10,798,242 1.31% $ 10,512,645 2.73% Total Property Taxes Levied $ 816,058,399 $ 386,654,045 Amounts for taxpayers with similar names have not been combined. Source: Property Appraiser's taxpayer listing in order of taxes levied. Property Appraiser Recapitulation Report. ' Century Link was Sprint in 1998 154 COLLIER COUNTY, FLORIDA PROPERTY TAX LEVIES AND COLLECTIONS LAST NINE FISCAL YEARS (amounts expressed in thousands) (unaudited) Fiscal Year Total Tax Collected within the Ended Levy for Fiscal Year of the Levy Collections in Total Collections to Date September 30 Fiscal Year Amount Percentage of Levy Subsequent Years Amount Percentage of Levy 2002 $ 157,744 $ 146,033 916% $ 136 $ 146,169 92.7% 2003 185,633 174,116 93.8% 325 174,441 94.0% 2004 225,773 213,009 94.3% 240 213,249 94.5% 2005 251,772 237,184 94.2% 98 237,282 94.2% 2006 307,068 293,129 95.5% 109 293,238 95.5% 2007 362,568 344,945 95.1% 1,522 346,467 95.6% 2008 343,906 325,722 94.7% 1,191 326,913 95.1% 2009 329,070 312,096 94.8% 2,546 314,642 95.6% 2010 314,176 297,953 94.8% - 297,953 94.8% Source: Tax Collector Annual Report 155 COLLIER COUNTY, FLORIDA RATIOS OF OUTSTANDING DEBT BY TYPE LAST NINE FISCAL YEARS (amounts expressed in thousands) (unaudited) Governmental Activities Business -type Activities General Loans and Loans and Total Percentage Fiscal Obligation Revenue Notes Capital Revenue Notes Capital Primary of Personal Per Year Bonds Bonds Payable Leases Bonds Payable Leases Government Incomes Capita' 2002 $ 795 $ 85,185 $ 9,256 $ 791 $ 78,725 $ 40,369 $ 327 $ 215,448 2.11% 848 2003 - 176,775 8,486 279 71,505 55,335 165 312,545 2.86% 1,179 2004 - 208,980 51,649 108 66,860 74,545 73 402,215 3.47% 1,458 2005 32,815 444,375 14,030 82 62,515 113,067 25 666,909 5.61% 2,331 2006 29,530 429,735 51,546 1,029 58,060 124,629 - 694,529 5.46% 2,341 2007 25,815 409,620 57,331 897 163,630 106,932 68 764,293 5.02% 2,483 2008 27,830 394,145 103,461 752 158,885 103,903 618 789,594 4.39% 2,521 2009 36,719 377,940 89,590 599 153,980 106,935 492 766,255 3.86% 2,443 2010 29,162 421,285 19,689 439 148,983 106,509 636 726,703 3.68% 2,303 sSee the Schedule of Demographic and Economic Statistics for personal income and population data. 156 COLLIER COUNTY, FLORIDA RATIOS OF GENERAL BONDED DEBT OUTSTANDING LAST NINE FISCAL YEARS (unaudited) Percentage of Estimated Less: Amounts Actual Taxable Available in Debt Value' of Per Service Fund Total Property Capital 76,461 General Fiscal Obligation Year Bonds 0.057% 107 2002 $ 795,000 $ 2003 - 2004 - 2005 32,815,000 2006 29,530,000 2007 25,815,000 2008 27,830,000 2009 36,719,204 2010 29,161,925 Percentage of Estimated Less: Amounts Actual Taxable Available in Debt Value' of Per Service Fund Total Property Capital 76,461 $ 718,539 0.002% 3 21,935 32,793,065 0.057% 107 22,576 29,507,424 0.043% 90 4,312 25,810,688 0.030% 77 374,496 27,455,504 0.030% 82 451,641 36,267,563 0.041% 109 496,997 28,664,928 0.036% 86 'See the Schedule of Assessed Value and Estimated Actual Value of Taxable Property for property value data. 2See the Schedule of Demographic and Economic Statistics population data. 157 COLLIER COUNTY, FLORIDA LEGAL DEBT MARGIN INFORMATION AS OF SEPTEMBER 30, 2010 (unaudited) The Constitution of the State of Florida, Florida Statute 200.181 and Collier County set no legal debt limit. DIRECT AND OVERLAPPING GOVERNMENTAL ACTIVITIES DEBT AS OF SEPTEMBER 30, 2010 (unaudited) Percentage Net Debt Applicable to This Governmental Entity Outstanding (1) Governmental Unit Direct Debt: Debt repaid with property taxes: County $ 28,664,928 100.00% Overlapping: Overlapping debt for governmental entities within Collier County is not presented. (1) Excludes amounts available in Debt Service Funds for payment of interest and principal. 158 W � Q C7 c 29 w O i W 0 -+O T a LL v Q�Q c v N d D z y2j O > W C W CL OC C9 2 w O c g J E a m W Q « E E w d V pC m N � a E g x d m y vni n d N N Q a N h V a 0 O CO. W N1bMb 00000000 N Vf W O N m O N mwnnbvtON N v O O N N s N � fl N M rm1 N(�1 eb�l n N N ri „1 e1 '1 N m m N O p1 N 4!1 .y mnwry mo orvom v mcc cc ocn n mm Si�m� m aame�ie m cmm wNrvm �n .+ o_ m P% w -1 M w v a p m n n mOOm000000 S l b w m$ M w m vi aon MMm rri m ri ,ti 'i 'i r 'i V1 e-I b b O Vl N m M O vt N N O O m ei 'I ei ei rviO NCO pi W OI 0? ,r Mm. w mn e�M�O ubi nm .. C l0 n '+ N y N O t0 l0 y 8 a q F 7u gg�88g8go e m 159 oC m C E a a" a n a a a a a a< a b 2 2 2 2 2 2 2 2 m V d 2 N N c 6 N C tpp ry E O N N N ti Q � N M w m b m O w 0 M w b n O ✓1 b N ri ri M y v o v o v b rl m m M 1p n w M d m o� m w a vrvi M d� p O M N N 1l1 n n lD V 2 - N N a q m$ in b b ui b b< O? o N�� a umi n m ry o e v v d v v c vi Z ry> N N N C m N n N b b O b m A N N rl N VI b n n w J 6 d N m v vni e n m 0 0 0 s V 9 49 it g g g g g g g o L Y N N N N N N N N N C d a n x a v `a ti A > Y � V E C O a � E a a M c v c � m Y l O C_ O U n a Y � O c o c � p d C a r v Y a i o u i m � i o L c m a O � i a n d a i a o o n � � a �O « i m O a x °a a y o N a > i a � o L C V a a C 7 � X d a C O ° > � o w n i w c z 1 COLLIER COUNTY, FLORIDA DEMOGRAPHIC AND ECONOMIC STATISTICS LAST NINE FISCAL YEARS (unaudited) Per Capita Fiscal Personal Personal Median School Unemployment Year Population(1) Income(2) Income(2) Age(3) Enrollment(4) Rate(5) 2002 264,475 $ 10,197,520,000 $ 40,121 40.5 37,110 4.2% 2003 284,918 10,940,352,000 41,269 44.1 38,196 4.7% 2004 292,466 11,601,373,000 42,050 45.2 40,416 3.9% 2005 306,186 11,878,015,000 41,513 45.6 41,232 3.6% 2006 326,658 12,711,343,000 42,846 44.7 43,000 2.7% 2007 333,858 15,236,905,000 49,492 44.5 42,722 3.5% 2008 332,854 17,990,169,000 57,446 44.8 42,711 5.5% 2009 333,032 19,846,737,000 63,276 45.1 42,822 10.0% 2010 331,800 19,739,453,000 62,559 45.2 43,142 12.2% Sources: (1) www.fred.labormarketinfo.com (2) www.fred.labormarketinfo.com (3) Florida Statistical Abstract (Table 1.51) (4) Collier County School Board, based on full time equivalent enrollment (5) www.fred.labormarketinfo.com 160 COLLIER COUNTY, FLORIDA PRINCIPAL EMPLOYERS (Unaudited) Sources: Economic Development Council Collier County, 2010 Collier County Finance Department and Collier County Sheriff Finance Department 2001 Collier County Adopted Budget Florida Department of Labor & Employment; Bureau of Labor Market Information ES -202 report for 2001 and 2009. 161 2010 2001 Percent of Percent of Total County Total County Employer Employees Rank Employment Employees Rank Employment NCH Healthcare System 5,000 1 4.75% 2,200 3 2.01% Collier County Public Schools 4,728 2 4.49% 4,153 1 3.79% Publix Supermarkets 3,246 3 3.09% 1,900 4 1.73% Marriott Corporation 2,328 4 2.21% - - CollierCountyGovernment (excl. Sheriff) 2,200 5 2.09% 2,993 2 2.73% Wal -Mart 1,715 6 1.63% - - CollierCountySheriffsOffice 1,383 7 1.31% 1,076 5 0.98% Winn Dixie Stores, Inc. 1,014 8 0.96% 900 6 0.82% Home Depot 1,012 9 0.96% - - Gargiulo Inc. 800 10 0.76% - - Ritz Carlton Hotel - - 870 7 0.79% Registry Resort - - 750 9 0.68% Bentley Resort - - 400 30 0.37% Marco Island Resort & Golf Club - - 843 8 0.77% Other employers 81,761 77.75% 93,463 85.33% Totals 105,187 100.00% 109,548 100.00% Sources: Economic Development Council Collier County, 2010 Collier County Finance Department and Collier County Sheriff Finance Department 2001 Collier County Adopted Budget Florida Department of Labor & Employment; Bureau of Labor Market Information ES -202 report for 2001 and 2009. 161 COLLIER COUNTY, FLORIDA FULL -TIME EQUIVALENT COUNTY EMPLOYEES BY FUNCTION LAST SEVEN FISCAL YEARS* (unaudited) Function: General government Public safety Physical environment Transportation Economic environment Human services Culture and recreation Water and Sewer Solid Waste Airport Authority Emergency Medical Services Total Fiscal Year 2010 2009 2008 2007 2006 2005 2004 1,163 1,182 1,127 1,300 1,264 1,225 1,126 1,087 1,103 1,118 1,117 1,144 1,000 987 61 64 65 73 67 57 58 206 234 254 268 244 265 253 27 23 22 18 16 15 15 47 44 47 52 53 55 48 306 317 335 397 389 337 335 325 310 309 336 312 297 288 25 22 22 23 27 26 23 15 16 14 15 13 13 14 165 168 168 188 167 158 161 3,427 3,483 3,481 3,787 3,696 3,448 3,308 * Information prior to fiscal year 2004 is not available. Total includes full time employees and temporary employees. 162 Z O O Z N LL O m zoS LL a 0 p z c Z Z W op CL O 163 C N E m E E a Y a a p O � c C O O O Y K n C v � v E E � E B Y 0 0¢ U V m o O o o l l `vu u o u .- ouu c N a c c o u c L o 0 a a v " o co_ z m a m c c u o n n v U m m �t u �i u m m a °ti�'33 0° m m v v e m ' .ti m .�+ e m C v 2i o vi I ri N m a a N 1!1 'i app a0 Ot T w ry O O Q N ry W J1 O W N W N W n G V 'a q N o c n N m A c C ~ `o g N M~ m n p m O] n N b v_m .o-. N VI N D] ebl OJ p �O 1!1 O N 1 p 0 0 N n .y OJ N O N O N CO 8 N O1 N O N ry fV' N b O n CO VI c- a a r ti LL z m u° in N m z b N LL a ry 1p m N O1 ri N Vf lO n O edx n vl ry m o elf �!f m b g O N lc n N Oct orn 01 Ln M 00 8 n ti b N N n M N V N b m Oct C N n n a N a} 01 VI lD n O 41 n W w N C 1p '1 N VI m m l0 V N I M a VI n M O 1!1 01 W b V b 8 VI N CO f1 N N a N rl O N .ti N fn' o n m m p n Lr Lr o N I ry 01 N l0 M N 40 � W N N V m N V T N N OJ D] � V1 N VI M m V 01 Yf m VI V1 g ° a " " ti N b N rtl n m rn m o m m m g m 1 0 n ry o b m b m n m �n .+ n 't m ry a n o ry rn ry ti O ti M � N O M N O V T O 25 O ° rn m N 163 C N E m E E a Y a a p O � c C O O O Y K n C v � v E E � E B Y 0 0¢ U V m o O o o l l `vu u o u .- ouu c N a c c o u c L o 0 a a v " o co_ z m a m c c u o n n v U m m �t u �i u m m a °ti�'33 c o N m a a m o � G V 'a q N o c n N m A c C `o N v_m .o-. c m c v C 3 p o c- a a r ti LL z m u° in m m z m LL a LL F u 3 3 163 C N E m E E a Y a a p O � c C O O O Y K n C v � v E E � E B Y 0 0¢ U V m o O o o l l `vu u o u .- ouu c N a c c o u c L o 0 a a v " o co_ z m a m c c u o n n v U m m �t u �i u m m a °ti�'33 z O Z W cc 99 T W V J � V + z h v 0 a W Q N z OC H z N U a F a a V N R 164 n n ry m m .r e 3 N m w m m m n ry e m r uQi ll m e m Imn .�+ n m e'i N ti 40 W N 8 N Z o � � m n Io N o m m m In ry m In m n � In �� a N N n H N Q Q W N� t0 n M d ti ri .a m o m 8 M m Q N m pN M n m N '1 Ill t0 l0 b N M t0 m V O M m Q rl m N n m m Q Q W Iv n b n .i In n M m n m W N V N V1 M 'I o m t0 N Q N m "I M N a0 Q Q m Q n l0 OO r1 n l0 r1 .4 M e4 fl1 rl l0 I(f 8 E H m a N m Yn i i m z � g a° IZ .n r- ei m vii u° z z N Q Q lIG N IO N ri m Vl Iq .ti w ID n ni n fVl 8 N b N b n m n N n n ID Q a0 '1 IO V1 n N W m n M tlf Q rI n O Ul m IO N rl M n O n 8 ry N m N er rvi Q n ti 01 N M n OI tD W m m n N N C N n W m y n N ON n N yO m Q M Q Q m IO r1 W N N O O T � ri 8 N b m N O m n In m vl m m m ao m ao o ao m Io m .-I m ry � a ry o vl Q � m v m m o Ion m N n m M m m m oo In o0 o In In m ry N N 164 C o a m m E Z o � a d C o E E a w LL m Yn i i z � g a° IZ .n r- vii u° z z 164 SINGLE AUDIT /FEDERAL AND STATE SCHEDULE OF FINANCIAL ASSISTANCE The Single Audit /Federal and State schedule of financial assistance section presents Grants compliance reports filed by Collier County with Federal government and State government, respectively. THIS PAGE INTENTIONALLY LEFT BLANK J ERNST &YOUNG Ernst &VOUngLLP Report of Independent Certified Public Accountants on Internal Control Over Financial Reporting and on Compliance and Other Matters Based on an Audit of the Financial Statements Performed in Accordance with Government Auditing Standards Members of the Board of County Commissioners Collier County, Florida We have audited the financial statements of the governmental activities, the business -type activities, the aggregate discretely presented component units, each major fund, and the aggregate remaining fund information of Collier County, Florida (the County) as of and for the year ended September 30, 2010, which collectively comprise the County's basic financial statements and have issued our report thereon dated February 22, 2011. We conducted our audit in accordance with auditing standards generally accepted in the United States and the standards applicable to financial audits contained in Government Auditing Standards, issued by the Comptroller General of the United States. Internal Control Over Financial Reporting In planning and performing our audit, we considered the County's internal control over financial reporting as a basis for designing our auditing procedures for the purpose of expressing our opinions on the financial statements, but not for the purpose of expressing an opinion on the effectiveness of the County's internal control over financial reporting. Accordingly, we do not express an opinion on the effectiveness of the County's internal control over financial reporting. A deficiency in internal control exists when the design or operation of a control does not allow management or employees, in the normal course of performing their assigned functions, to prevent, or detect and correct misstatements on a timely basis. A material weakness is a deficiency, or combination of deficiencies, in internal control, such that there is a reasonable possibility that a material misstatement of the entity's financial statements will not be prevented, or detected and corrected on a timely basis. Our consideration of internal control over financial reporting was for the limited purpose described in the first paragraph of this section and was not designed to identify all deficiencies in internal control that might be deficiencies, significant deficiencies or material weaknesses. We did not identify any deficiencies in internal control over financial reporting that we consider to be material weaknesses, as defined above. 1102-123 1 a 14 167 JERNST &YOUNG Compliance and Other Matters As part of obtaining reasonable assurance about whether the County's financial statements are free of material misstatement, we performed tests of its compliance with certain provisions of laws, regulations, contracts and grant agreements, noncompliance with which could have a direct and material effect on the determination of financial statement amounts. However, providing an opinion on compliance with those provisions was not an objective of our audit and, accordingly, we do not express such an opinion. The results of our tests disclosed no instances of noncompliance or other matters that are required to be reported under Government Auditing Standards. We noted certain matters that we reported to management of the County in a separate letter dated February 22, 2011. This report is intended solely for the information and use of management, the Board of County Commissioners, others within the entity, the Auditor General of the State of Florida, federal and state awarding agencies and pass - through entities and is not intended to be and should not be used by anyone other than these specified parties. 1�9� f "7 UP February 22, 2011 1102- 1231314 168 JERNST &YOUNG ''I & " °° "P , Report of Independent Certified Public Accountants on Compliance With Requirements That Could Have a Direct and Material Effect on Each Major Federal Program and State Project and on Internal Control Over Compliance in Accordance With OMB Circular A -133, Section 215.97, Florida Statutes, and Chapter 10.550, Rules of the Auditor General Members of the Board of County Commissioners Collier County, Florida Compliance We have audited Collier County, Florida's (the County) compliance with the types of compliance requirements described in the U.S. Office of Management and Budget (OMB) Circular A -133 Compliance Supplement, and the requirements described in the Florida Department of Financial Services State Projects Compliance Supplement, that could have a direct and material effect on each of the County's major federal programs and state projects for the year ended September 30, 2010. The County's major federal programs and state projects are identified in the summary of auditor's results section of the accompanying schedule of findings and questioned costs. Compliance with the requirements of laws, regulations, contracts, and grants applicable to each of its major federal programs and state projects is the responsibility of the County's management. Our responsibility is to express an opinion on the County's compliance based on our audit. We conducted our audit of compliance in accordance with auditing standards generally accepted in the United States; the standards applicable to financial audits contained in Government Auditing Standards, issued by the Comptroller General of the United States; OMB Circular A -133, Audits of States, Local Governments, and Non - Profit Organizations; Section 215.97, Florida Statutes (Section 215.97); and Chapter 10.550, Rules of the Auditor General, State of Florida (Chapter 10.550). Those standards, OMB Circular A -133, Section 215.97 and Chapter 10.550 require that we plan and perform the audit to obtain reasonable assurance about whether noncompliance with the types of compliance requirements referred to above that could have a direct and material effect on a major federal program or state project occurred. An audit includes examining, on a test basis, evidence about the County's compliance with those requirements and performing such other procedures as we considered necessary in the circumstances. We believe that our audit provides a reasonable basis for our opinion. Our audit does not provide a legal determination of the County's compliance with those requirements. 1102-123 13 is 169 J ERNST & YOUNG As described in item 2010 -1 in the accompanying schedule of findings and questioned costs, the County did not comply with requirements regarding reporting that are applicable to its State Housing Initiative Partnership (SHIP) Program. Compliance with such requirements is necessary, in our opinion, for the County to comply with requirements applicable to that program. In our opinion, except for the noncompliance described in the preceding paragraph, the County complied, in all material respects, with the compliance requirements referred to above that could have a direct and material effect on each of its major federal programs and state projects for the year ended September 30, 2010. The results of our auditing procedures also disclosed other instances of noncompliance with those requirements that are required to be reported in accordance with OMB Circular A -133, Section 215.97, or Chapter 10.550, and which are described in the accompanying schedule of findings and questioned costs as items 2010 -2 through 2010 -7. Internal Control Over Compliance The management of the County is responsible for establishing and maintaining effective internal control over compliance with the requirements of laws, regulations, contracts, and grants applicable to federal programs and state projects. In planning and performing our audit, we considered the County's internal control over compliance with the requirements that could have a direct and material effect on a major federal program or state project in order to determine our auditing procedures for the purpose of expressing our opinion on compliance and to test and report on internal control over compliance in accordance with OMB Circular A -133, Section 215.97, or Chapter 10.550, but not for the purpose of expressing an opinion on the effectiveness of internal control over compliance. Accordingly, we do not express an opinion on the effectiveness of the County's internal control over compliance. Our consideration of internal control over compliance was for the limited purpose described in the preceding paragraph and was not designed to identify all deficiencies in internal control over compliance that might be significant deficiencies or material weaknesses and therefore, there can be no assurance that all deficiencies, significant deficiencies, or material weaknesses have been identified. However, as discussed below, we identified certain deficiencies in internal control over compliance that we consider to be material weaknesses and other deficiencies that we consider to be significant deficiencies. 1102- 1231314 170 III JERNST &YOUNG A deficiency in internal control over compliance exists when the design or operation of a control over compliance does not allow management or employees, in the normal course of performing their assigned functions, to prevent, or detect and correct, noncompliance with a type of compliance requirement of a federal program or state project on a timely basis. A material weakness in internal control over compliance is a deficiency, or a combination of deficiencies, in internal control over compliance, such that there is a reasonable possibility that material noncompliance with a type of compliance requirement of a federal program or state project will not be prevented, or detected and corrected, on a timely basis. We consider the deficiency in internal control over compliance described in the accompanying schedule of findings and questioned costs as item 2010 -1 to be a material weakness. A significant deficiency in internal control over compliance is a deficiency, or a combination of deficiencies, in internal control over compliance with a type of compliance requirement of a federal program or state project that is less severe than a material weakness, yet important enough to merit attention by those charged with governance. We consider the deficiencies in internal control over compliance described in the accompanying schedule of findings and questioned costs as items 2010 -2, 2010 -3, 2010 -4, 2010 -6 and 2010 -7 to be significant deficiencies. The County's responses to the findings identified in our audit are described in the accompanying schedule of findings and questioned costs. We did not audit the County's responses and, accordingly, we express no opinion on the responses. This report is intended solely for the information and use of management, the Board of County Commissioners, others within the entity, the Auditor General of the State of Florida, federal and state awarding agencies, and pass - through entities and is not intended to be and should not be used by anyone other than these specified parties. ,&� f "7 UP February 22, 2011 1102- 1231314 171 COLLIER COUNTY, FLORIDA SCHEDULE OF EXPENDITURES OF FEDERAL AWARDS AND STATE PROJECTS FOR THE FISCAL YEAR ENDED SEPTEMBER 30, 3010 CFDi Transfers to Federal or State Grantorderso-Through Grantor Program Tale CSFAIf Grant /Contract Number Expenditures Suhreapients Department of Aerioolwre Indirect Programs Ronda Department of Education: Summer Faced Service Program for Children CO.S59 04 -0804 S 795,363 $ - Florida Department of Agdwltmu and Consumer Services: Cooperatvv Forestry Au6tance 10 664 Isles ad Capri Fire District 2,720 - GoperemeFOrestryASSlstance 10 LEFT odmpee Rre District 4,615 Total CFDA 7,335 TW al Department of Agriculture 802,698 Dnnartmem pl Cam Indirect Programs: Florida Distortions of Community Affairs_ Public Safi nteropeable COmrnunkarimn GrantProgoin I1 -555 09 -0531 -032101- 269 170,775 Total Department of Commerce 170,175 Department of Houi ne and Urban Development Direct Programs: Office of Communiry Planning and Development CDBG - Finalemam Gram,Custer Communiry Development Block Grants/ Entitlement Grants 14.218 107 -UC -12-0016 122,371 121,966 Communil Development Block Grants/ ErARIement Gran, 14.218 B08 TIC - 120016 491,305 439,539 Community Development Block Grants/ Fnttt ement Grants 14.218 1 o9-UC- 120016 1,657,652 1,221,541 Community Development Block Granin/ E ntRlemeni Grants 14.210 BDe- UN- l2UO03 3,373,724 - Communityoeveloprn Part Block Giants/ Entitlement Grants 14.P8 B-ITUC -12006 154890 Total CFDA 5,799,942 1,782,046 ARRA (ournmerly Development Block Grant AREA Ford. nrenIGranb 14253 AREA 1-09 US 120016 78,971 48,000 Total COBG - Entitlement Gmn6 Cluster 5,878,912 1,830,046 Emerli Sheller Grants Program 16231 S09 UO320024 86,94 84,141 Supportive Housing Program 14.235 11.14850 -WOl 45,994 40,977 Support.,. Housing Pragrarn 14235 FL348506pG2 24,016 24,016 Supportive Housing Program 10235 FL34010-6001 92,082 92,.22 Supportive Housing Program 14235 TLOPTIMM060801 104,546 102,155 Supportive Hwsmg Program 14235 H0:95MOOW801 70,002 78,002 Supportive Housing Fragrant 14.235 FLO2B604D060801 21,399 23,399 Supportive Housing Program 14235 110294240060801 3/,533 left IPUB 406,472 361,432 Home Investment Partnerships Program 14.239 M01 UC- 120211 234,626 224,676 Home investment Partnerships Program 14.739 .1.11111.211 17,097 204 Home Investment Partnerships Program 14.239 MhortIR 1) 0217 233,907 117,075 Home ]ne'dol nt Pronershgrs Program 14.739 M- 10 -UC -12 -0217 74,373 rural IFDA 510,798 31 Emnomlc Development Initiative Special Project, Neighborhood aterve and Miscellaneous Granin 14251 B-085P- FLL368 29,400 - ARRA Homelessness Prevention and Bald Be- HOUSIng Toni(HPPP) 14.25/ AREA S09 -UY- 120024 207,221 187,059 Indirect Programs Florida Department of Communiry Affairs_ Community Development Block Grants/ Stale a Pragrarn 14.220 it 092101 -Cal 11g, 694 ""is, Community Development Bluffs Grants/ State's Program 14.228 O1 D3 -09- 21.1 -A03 1,405,016 611,361 CommonRy Development Block Granin/ State' s Program 14.228 10 IR Pa 9 -2101 K09 24,184 111111 CFDA 1,627,894 716,519 Total Department of Housing and Urban DevelopmeLrt Department of the Internal 8,747,271 3,521,612 Direct Programs: Bureau of land Management Payments In then of Taxes 15.226 Collier COnnry 1,229,064 - Fish and W OdbYe service. Partners for Fish and wadnfe 11 631 totaling? ] 1,746 Total Department of the Interior I ]3n,310 (Crain] rued) See acrornpatying notes to the schedule of expenditures of federal awards and state projects COLLIER COUNTY, FLORIDA SCHEDULE OF EXPENDITURES OF FEDERAL AWARDS AND STATE PROJECTS FOR THE FISCAL YEAR ENDED SEPTEMBER 30, 2010 CFDA ID Transfers to Federal or State Grantion/Pars -Through Grantor Program Tiftle CSFAA Gount/Cationat Number E ndit r S br c 1 n[ Department of mstice Direct Programs'. OHlce of Justice Programs: Federal Equitable Sharing 16. unknown Collier County fiedfl $ 6,557 5 - Office oNictTms of Code'. Servlcesfor Dafflcking Victims 16320 2005- VI- BX0002 ID6,045 - V101ence Against women Office Su revised Vlstation, Safe Haver, fo r Cold or 1652) 2009 -CW AX-KO 11 126384 - Office of Community Oriented Policing Services: Public Safety Partnership and COmmunlry Policing Grants 16710 2009COVS0204 320,020 - Indirect Programs: Florida OKce of Attorney General'. C(me Victim A SS6tame 16525 V09129 1186]5 - F land Department of Children and Fn oulll, Violence Again st Warner Fmmu It A a nts 16.588 Us 136,303 - ARRAV IOIence Agsmi Women FOrmu la G ran is 16.588 ARM LN947 05,851 - ARRAVI OIence Against Women Formula Grants 16.580 ARM 8008 8,948 Total CFDA 230,901 Florida Department of Law Eofmarnenr. Public' Safe Nelghlwrboods 15.609 2000- PMAGCOLL -I -116005 19,462 - Edward Byrne Memorial Justice Assistance Grant Poollorn I6. CIS 20111-IAGCIOIL -I 4X -221 111,110 - ARRA Recovery Act- E Award Byrne Memorial Justice Assistance Grant (JAG) Program/ Grants(, States and Territories 16.003 ARRA 2010- ARRC -FORM 7117 -315 288,263 - ARRA Recovery AR- Edward Byrne Memorial Justice Assistance Gant JAG) Program/ Gantsto States and Tenporles 16.803 ARM 2010- ARRC- COP L- 2WE032 432,600 Total CFDA 120,863 _ Taal Department of Justice 1,820,626 Department of Labor Indoect Programs: Employment Training Administration. WIAAdult Program 11258 Fallen County 8,681 Taal Department of Labor 8,601 Department of Transportation Direct Program, III A aliens Admoustrabom Airport Improvement Program 20 -106 3 -11 -0031-0., -1009 FIT ell Airport Improvement Program 20106 3 -12 -0031 -006 -2009 49,158 - Airport lmprovementProgam 20106 A 120142dAdt 2001 5544 - Acorn RnpmvemenlProgram 20 -106 31-0142 -0OS -2008 13,689 Total IHIA 29,312 Federal Transit Administration (FTA) - Federal Transit Closter: Federal TransibCr,dI Investment Grants 10500 FL04 0041 00 86,115 - FederaJrramX Capital Investment Grants 20.500 FL 040264 -CO 48,991 Total CFDA 135,172 ARRA Federal Tan l- Formula Grants 20502 AREA FL- 96X019 -00 1,265,885 - Federalfranstt- Formula Grants 20.501 IL -90- X50800 4985 - FederalTransl {ormula Grants 20.501 FL- "Isr5I To 13,121 - FederalTransit - Formula Franc 20501 FL- 90- X580-00 32005 reveal Transit-Pormnla mod", 10501 FI- 90X145 -00 464 - Fenno' Iranl- Pormnla Grants 2050/ FL- 90- XI,6500 1,016,046 - Federal Transit Formula Gams 20501 FL 91) X699 -00 990,924 TmaI CFDA 3,443,436 Total Fedeal Tamo Cluster s,s/8,6o9 Indirect PrcgraFcS Florida Department W Transportation- Highway Planning and Construction 10205 414534- 1 /APB25 301,015 - HlghwayPlanningandCOnstruction 20.205 416342- 1/A4311 436,151 - HlghwayPlanningandConslruction 10205 420811- 1/A4317 94,163 Highway Planning and I ... F rced 10.205 420885- 1 /APg91 140,328 - HighwayPlamnngandCOnstruction 20.205 423653- 1 /AP900 64,519 - HighwayDancingarrdComionren F. 2.0 423111 /APWI 240,489 - HlghwayPlanningandCOnsnucGml 10.205 423655- 1 /APM21 10,714 T..1CFDA 152/996 c: Formnuedl COLLIER COUNTY, FLORIDA SCHEDULE OF EXPENDITURES OF FEDERAL AWARDS AND STATE PROJECTS FOR THE FISCAL YEAR ENDED SEPTEMBER 30, 2010 CFDA # / Tran51¢Rto Federy or State Grantor /Pass -Than bGrantor Program Title 6FA# Gat /C ntratl Number E enditures 5 beti isms Metropolllan➢- Gracumpon Planning 10.505 104191 -1 /Aci $ 2A465 5 - MctmpOlRanTrarsportatlonPlanning 10505 4 LEE 13- t /ASIDE 11/,102 total CIDA 141,587 FonnuC, Grants for Other Than Urbanized Areas 10509 4101)0- 1 /AOW89 245424 - ARRAPOmmUGrantstorO ther Than Urbanized Areas 20509 ARM4267721 /API39 159,093 - ARRAFOrmulaGran is for 0ther Than Urbanized Area, AREA 4161961 /ADIR 78,681 1ahICIDA 483,198 State and Community Highway Safety 20.600 APT99 89,968 State and Community Highway Spi 20.600 APO 14 31,210 Imml CFDA 121.679 Total Department of Transportation 1,932, 1. DenaNmem of Treasure Direct Programs'. Departmem of If .car,'. Federal Equitable Sharing 21 unknown Collier County Sheriff 35,400 Ta l Department of Treasury 35,400 Environment PrateRlon Aeem'v Indirect Programs: Florida Department of Environmental Protection_ Capitalization Grants For Drinking Water State Revolving FwlM1 66468 DWI 111030 5,839,056 Tgal Environmental Protection Agency 5,839,056 Deoartment of Energy Direct Programs: ARRA Energy Efficiency and Conservation Bloc k Grant Program FEE CBGI A1.128 ARRA DE EE0000783 1,140,045 Total Departmentef Energy 1,140,045 U.S. Election Allegiance Commission Indirect Programs: Florida Department of State_ Help Amend Vole Ali Requlrernents Payments 90.401 Collier (.only FY 200506 6,724 Help America Vote Act Requirements Payments 90 -401 ColkeICOUnry- PV200607 13,935 - HelpAmenreVOteAct RequlrementsPayrnents 90401 Collier County- W2001118 31.825 - HelpAmerlcaVOteActRequlremen is Payments pi 1o111er County -F11. +19 590 - HelpAmericaVOteACtRequhementSPaym .refs 90401 2009- 20100001a 7,406 TW al U.S. Elettion Assistance Commission 611,480 Deoartment of Health and Human Service Direct Programs: Health Resources and Services AdminiAra OOn. Health tare and Other Facilities 93887 17611F15996 95,090 - SpecallV Selected Health Pmlects 93.888 DIED 10769 149,080 - Ind llect program,'. Cards Department of E nor Affairs Area Agency on Aging fm Southwest Florida, Inc Aging Clus[er Special Programs for the Aging Title If Part 0 Grants for Supportive Services and Senior Centers 93044 OAA Art .1 22,980 - Special Programs for DEC Aging -Title 111, Parr 8- Grants for Snpparme Sfri and 5emor Cemer e 93044 OM2OV0 62,200 Total CFDA 85,181 Special Programs for the Aging I Elp III ,Part (Nutrition Serv¢c 93045 CAP 203.09 137,632 - Special Pmgrzmsfor the AgingTRIe II1, Pmt C Nutrition Services 93.045 Cook )03.111 328927 Total CFDA 466,559 Nutrition Services lmenHVe Program 93053 NSIP 203 -10 ]$$A - ARRA Aging Home- Delivered NUO M1 ion Servlres for "are, 93.705 AREA 203 -09 6,640 ARRA Aging Congregate Nutrition Secenes for Stater 93101 ARRA 2O3. 09 19,178 Total Aging Clmter 585,115 N.H.nsl Famil y Caregiver Support, Title ill, Part E 93 W,2 OAA 203 09 52,599 - NationalFamily Caregiver Support Title HE P,rIE 93. D52 CAA 20310 11 Total (FDA .1 Ann lortmencell COLLIER COUNTY, FLORIDA SCHEDULE OF EXPENDITURES OF FEDERAL AWARDS AND STATE PROJECTS FOR THE FISCAL YEAR ENDED SEPTEMBER 30, 2010 CFDAK/ TransFlrS to Federal of State Grantor/Par-Through Grantor Program Fell GFAIs Grant /Conrad Number EVenditures Subedpiems Florida Department of Revenue- Chid Support Enforrement 91563 CIJ3ll $ 230,680 $ - Florida Department of Store Voting Acres(or lndMduakwith Disabilities Grantsto States 93.61] Coll,t(ourny- FY2005 -06 7,538 - Flo ride Departure ut of Transportation Commission forth, Transportation Disadvantaged. MedicalAssetance Program 93778 0161103- 1 /GDMS9 507,266 Taal Department of Health and Human Services 1,660,266 Corporation for National and [ommuNiv d,vU Direct Programs: Retired and Senior Volunteer Program 94002 06HISPD)4 869 - RetiredandSenlorVolun teer Program 94.002 09SRSFL0J7 47,010 Total Corporation for National and Community Service 4],8)9 pe..Sunni of H Omeland SecuNv Indirect Programs: Homeand remnty Cluster Florida Department of Law Enforcement State Domestic Preparedness Equipment SUppnl Program 91004 SLIDE, ElP{gLL- 3N1J13 408,742 - Homeland 5ewnry Granremgmur 9.06] 20TH- SHwrou ds4AA1 11,858 - Tomeland5e,mr- ,1 uem.gram 97.067 SHOP - SIISP -COLL- 154 -010 5000 - Florida Department of Community Affairs: Homeland Security Grant Frngrmn 9 2.061 09009,09 -21 -01 -341 1,203 - Homeland5,me, Form Program 97.067 09CI49 -09 -21 -01 -350 1,300 - Homeland Security Grant Program 97057 0905 - 510921 -01 -322 61,115 TotalCFOA A4,477 Total Homeland security Cluster 493,218 Disaster Grants- Public Assistance PresidentlallY Declared Disasters 9/.035 O6 Sun $X ,0 &21 -01£92 9,731,561 - DisasterGrants - Public ASSistance(Presidentially Declared Disasters 91.036 08- fA- R9- 09- 2100.509 1,634 - ToaslerGiants - PUM., ASSlsta nce Presldenllally Declared Disasters 97.036 OB- IA -SoID )I -00.110 144582 Total I III 9,8)1,771 Hoard Mitigation Grant 91.039 (OHM 88 09 2191 -012 ]9,148 - E me ri Manage me nt Pedormanc e G rants HS ii to -PSG 25 -09 -2101 -102 35,20, Tgal Department of Homeland Security 10435,945 TOTAL EXPENDITURES OF FEDERAL AWARDS $ 37,932,292 $ 3,521,612 COLLIER COUNTY, FLORIDA SCHEDULE OF EXPENDITURES OF FEDERAL AWARDS AND STATE PROJECTS FOR THE FISCAL YEAR ENDED SEPTEMBER 30, 2010 (Continued) CFDA p/ Transfers to Federal Or State Grantor /Pass -Tbeep Granter Program Tale CS FA# Grant /Conrad Number Ery¢nditures Subredpients Florida Department of Environmental Protection Ronda Recreation DevelopmentASS &lance Program t7 017 A9040 $ 2,131 S - Statewide Surface Water Restoration and Watlewater Prolertt 32039 46011002032 39329 - Innovative Waste Reduction and Racyding Parts 31 IT IG8-07 3,229 Innovative Waste Reduction and RegcMg Grants 91 050 166119 11,207 Total CSFA 14,493 Total Florida Department of Environmental PrOte Lion 55,953 FleallDetentions of State and sereary of5tad Stale Aid to Libraries 45.030 07 ST 12 3,850 - fromSudtolNarles 45.030 09ST10 29,153 Total Florida Department of State and Seeled., of State 3J 003 Flplda Department of Community Afti Emergen, Management Programs 52008 10 BG2509 -2101 -102 98,095 Fme"r, Management Pmlects 52.023 1O(1i Pat Ter 21 -01 -146 2,075 Total Florida Department of Community Affairs 105,120 Flrida Header Finance Ca noration State Housing Initiatives Partnership (SIT IP) Puri 52.901 Calker County /Naples 294,829 84,887 Total Florida Housing Financee Corporation 294,879 84,882 Fiat as Broadhead of TransoprtMion Commission for ma Ta respor an ion Dbadva raged Ira DI trip and Equipment Grant Program 55.001 20P.46- 1/2072463 /Al 421 - Commission for the Transportation Disadvantaged ICSDI Trip and Egwpment Grant Program 55.001 202246 - 1/207246 -3 / AP263 146,982 Thal CSFA 575,652 poommurvion for the Transportation Disadvantaged (i Planning Gant Program 55002 207246- 2 /APJ51 15,381 - Commissionf orth, Transportation Disadvantaged CIDI Planning Grant Program x10112 pip 2/AQ034 6,394 Total CSFA 21,775 Avfallon D,velmermll Grants 55004 20M301/A1935 18,383 Aviatloo Development Grants 55004 410788- 1 /ADF09 419,156 - Av7atipn Development Granrs 55.004 4142991/ADR09 216,213 - AviationDevelppmenthand 55004 4141701/ANH17 13,913 - Aviation DeveloPm1111hants 51004 426083- 1 /APNR )351 Total CSFA 610,015 Pu hRC l ansi Block G a nt Program 51010 410139- 1 /ADW93 621,867 - PubLc IT ansR SeMce Development Program 51017 420446- 1/A0111 1W1 - 1 outmost .1 Development P mgra in 51014 420353- 1 /APF60 128,004 - State Infrastructure Bank 55020 421 1,839,148 - Transportation Regional Incentive Program (TRIP) 55026 425477 -1 31085092 Thal Florida Department of Transportation 8,944,593 Florida Department of Children and Families Homeless Challe age Grant 60014 HF2113 92,779 93779 Total FlWlda Department of @ilben and Families 92,779 92,779 Florida Department of Nealth Cou n ty 6 rant A wa rds 'A005 (8011 82,883 - Cpnnty front Assures par Bou 19011 91361 Tool Florida Department of Health 174,244 (Continued) COLLIER COUNTY, FLORIDA SCHEDULE OF EXPENDITURES OF FEDERAL AWARDS AND STATE PROJECTS FOR THE FISCAL YEAR ENDED SEPTEMBER 30, 2010 Florida Fish and Wildlife Conservation Commission Florida one he, Improvement Pmgmm Total Florida Fish and Wildlife Conservation Commission TOTAL EXPENDITURES OF STATE FINANCIAL ASS ISTANCE /]006 0809 61,011 62,011 $ 8,638523 $ 111,666 CFDA p/ Transfers to Federal or State Grantor /Pass Through Grantor Program Title CSFA# Grant /Contract Number EXpenditures Subredpiems Flalda Department of Elder Affairs Area Agen y on Agrog 1m SoutM1west Flpnda, Inv. Home Careforthe Elderly 65-001 HCC203.09 $ 4,661 $ - HomeCarefortheElderN 6;.001 NR 1,1 In 414 Total CSFA 4,935 Alzheimer's 8es{dte Services 65000 ADI 20309 81,345 - AliM1einieYSResppe5ervices 650W ACT 203.10 20,511 Total 6FA 101,862 Community Care for the eaerly(CCE) 6s o10 CCE 20308 100 — Community Care for the Hill l( CE) 61,010 CCE20309 60il - CommrmOyCarefortheElderly(CCE) 65010 CCE 20310 168,695 Total SEA 169,081 Total Florida Department of Elder Affairs 815,983 Florida Fish and Wildlife Conservation Commission Florida one he, Improvement Pmgmm Total Florida Fish and Wildlife Conservation Commission TOTAL EXPENDITURES OF STATE FINANCIAL ASS ISTANCE /]006 0809 61,011 62,011 $ 8,638523 $ 111,666 Collier County, Florida Notes to the Schedule of Expenditures of Federal Awards and State Projects Year Ended September 30, 2010 1. Basis of Presentation The accompanying Schedule of Expenditures of Federal Awards and State Projects (the Schedule) includes the Federal and State grant activity for Collier County, Florida (the County) and is presented on the modified accrual basis of accounting for expenditures accounted for in the governmental funds and the accrual basis of accounting for expenditures in proprietary funds. Under the modified accrual basis, revenue is recognized if it is both measurable and available for use during the fiscal year and expenditures are recognized in the period liabilities are incurred, if measurable. Under the accrual basis, expenditures are recognized in the period liabilities are incurred. The information in the Schedule is presented in accordance with the requirements of U.S. Office of Management and Budget (OMB) Circular A -133, Audits of States, Local Governments, and Non - Profit Organizations, and Section 215.97, Florida Statutes. Therefore, some amounts presented in the Schedule may differ from amounts presented, or used in the preparation of, the basic financial statements for the fiscal year ended September 30, 2010. 2. State Revolving Funds Reconciliation of State Revolving Funds (CFDA# 66.468) expended to cash received during fiscal year 2010: Expenses reported on Single Audit Schedule Reimbursements received for prior year expenses Total State Revolving Fund reimbursements received 1102-123 13 14 178 $ 5,839,056 452,618 $ 6,291,674 Collier County, Florida Notes to the Schedule of Expenditures of Federal Awards and State Projects (continued) 3. State Infrastructure Bank Loan The County received a $12,000,000 State Infrastructure Bank Loan from the Florida Department of Transportation in fiscal year 2008 for construction of the 1- 75 /lmmokalee Road interchange. The Florida Department of Transportation included this project with their concurrent widening of I -75 and retained the loan proceeds to fund the project. Accordingly, the County's expenditures for purposes of reporting on the Schedule consist of principal loan repayments only ($ 1,839,148 for fiscal year 2010) as no proceeds were received under the loan and no project expenditures were incurred or paid directly by the County. The principal balance of the loan as of September 30, 2010 is $ 8,203,475. The repayment schedule for this loan is as follows: Payment Date Principal Interest Total 10/1/2008 $ 1,957,377 $ 82,623 $ 2,040,000 10/1/2009 1,839,148 200,852 2,040,000 10/1/2010 1,875,930 164,070 2,040,000 10/1/2011 1,913,449 126,551 2,040,000 10/1/2012 4,414,096 88,282 4,502,378 $ 12,000,000 $ 662,378 $ 12,662,378 4. Hurricane Wilma FEMA Reimbursement Hurricane Wilma caused significant damage in Collier County on October 24, 2005. At that time, initial beach erosion damage reports indicated that Collier County was eligible for reimbursement of $3,783,907. The related expenditures were reported in the 2006 Schedule of Expenditures of Federal Awards and State Projects. As work progressed over the next few years, it was determined that Collier County had much more significant damage than originally thought. In January of 2010 a Storm Impact Re- assessment Report was completed. The results of this study formed the basis for an appeal to recapture additional reimbursement from FEMA. This appeal was successful and in September 2010, Collier County received an additional $9,731,561. These expenditures are reported in the 2010 Schedule of Expenditures of Federal Awards and State Projects since these expenditures were not determined to be eligible for reimbursement until the current fiscal year. 1102-1231314 179 Collier County, Florida Notes to the Schedule of Expenditures of Federal Awards and State Projects (continued) 5. State Criminal Alien Assistance Program (SCRAP) In January, 2010 Collier County Sheriffs Office returned $622,510 to the US Department of Justice (DOJ) as a result of DOD's audit of the SCAAP 2007 application. In April, 2010 DOJ reduced the SCAAP 2009 award by $791,555 as a result of their audit of the SCAAP 2006 application. 6. Contingency The grant revenue amounts received are subject to audit and adjustment. If any expenditures or expenses are disallowed by the grantor agencies as a result of such an audit, any claim for reimbursement to the grantor agencies would become a liability of the County. In the opinion of management, all grant expenditures are in compliance with the terms of the grant agreements and applicable federal and state laws and regulations. 1102-123 13 14 180 Collier County, Florida Schedule of Findings and Questioned Costs For the Year Ended September 30, 2010 Part I— Summary of Auditor's Results Financial Statements Section Type of auditor's report issued: Internal control over financial reporting: Material weakness(es) identified? Significant deficiency(ies) identified that are not considered to be material weaknesses? Noncompliance material to financial statements noted? Federal Awards and State Projects Section Internal control over major programs: Material weakness(es) identified? Significant deficiency(ies) identified that are not considered to be material weaknesses? Type of auditor's report issued on compliance for major programs: Unqualified Yes X No Yes X None reported Yes X No X Yes No X Yes None reported Qualified for the State Housing Initiatives Partnership Program (CSFA# 52.901); and Unqualified for all other major federal programs and slate projects Any audit findings disclosed that are required to be reported in accordance with section .510(a) of OMB Circular A -133, Section 215.97, Florida Statutes, and Chapter 10.550, Rules of the Auditor General, State of Florida? X Yes 1102-123 13 14 1 8 1 No Collier County, Florida Schedule of Findings and Questioned Costs (continued) Identification of major federal programs: Federal Programs CFDA Number Federal Agency /Name of Federal Pro¢ram U.S. Department of Housing and Urban Development: 14.218, 14.253 CDBG Entitlement Grants Cluster 14.228 Community Development Block Grant /State's Program (DRI) 14.257 Homelessness Prevention and Rapid Re- housing Program (HPRP) (Recovery Act Funded) U.S. Department of the Interior 15.226 Payments in Lieu of Taxes U.S. Department of Justice: 16.803 Recovery Act— Edward Byrne Memorial Justice Assistance Grant (JAG) Program /Grants to States and Territories U.S. Department of Transportation: 20.500, 20.507 Federal Transit Cluster U.S. Department of Energy: 81.128 Energy Efficiency and Conservation Block Grant Program (EECBG) U.S. Department of Homeland Security: 97.036 Disaster Grants — Public Assistance (Presidentially Declared Disasters) 1102- 1231314 182 Collier County, Florida Schedule of Findings and Questioned Costs (continued) Identification of major state projects: State Projects CSFA Number State Aeency /Name of State Project Florida Housing Finance Corporation: 52.901 State Housing Initiatives Partnership Program (SHIP) Florida Department of Transportation: 55.004 Aviation Development Grants 55.020 State Infrastructure Bank Loan Program 55.026 Transportation Regional Incentive Program (TRIP) 65.010 Dollar threshold used to distinguish between Type A and Type B programs: Federal Programs • State Projects Auditee qualified as low -risk auditee? Florida Department of Elder Affairs: Community Care for the Elderly (CCE) $ 1,137,969 300,000 1102-123 13 14 183 Yes X No Collier County, Florida Schedule of Findings and Questioned Costs (continued) Part 11— Financial Statement Findings Section This section identifies the significant deficiencies, material weaknesses, fraud, illegal acts, violations of provisions of contracts and grant agreements, and abuse related to the financial statements for which Government Auditing Standards require reporting. No such matters were identified. Part 111 — Federal Awards and State Projects Findings and Questioned Costs Section This section identifies the audit findings required to be reported by Circular A -133 section .510(a), Section 215.97, Florida Statutes, and Chapter 10.550, Rules of the Auditor General, State of Florida, such as material weaknesses, significant deficiencies, and material instances of noncompliance, including questioned costs, as well as any abuse findings involving federal awards or state projects that are material to a major program. Finding 2010 -1 State Program Information Florida Housing Finance Corporation (the Corporation) State Housing Initiatives Partnership Program (SHIP) CSFA No. 52.901 Criteria Reporting: • In accordance with Section 420.9075(l 0), Florida Statutes, each county or eligible municipality shall submit to the Corporation by September 15 of each year a report of its affordable housing programs and accomplishments through June 30, immediately preceding submittal of the report. • Annual reports for the Closeout Fiscal Year (2007/2008), Interim Fiscal Year 2 (2008/2009), and Interim Fiscal year 3 (2009/2010) (the Annual Report) must be included in the submission to the Corporation. 1102-123 13 14 184 Collier County, Florida Schedule of Findings and Questioned Costs (continued) • The local SHIP administrator's tracking system and annual reports must exactly match the information recorded in the local city or county's general ledger. • SHIP administrators, therefore, are required to regularly reconcile their tracking system with the local finance department's general ledger. They should meet with the director of their finance department to create a process that will ensure compliance with the single audit act. Condition /Context The financial information included in the submitted Annual Report was not reconciled to the County's general ledger. Accordingly, we were unable to validate the amount of expenditures and program income reported in the Annual Report. Questioned Costs M Cause /Effect The financial information submitted in the annual statutory reports did not agree to and was not reconciled with the general ledger. This could result in incorrect and /or inconsistent information between the reports filed and the underlying financial records and indicates that the County may not be in compliance with the provisions of the SHIP Program Manual requiring that amounts reported in the Annual Report match the amounts reported in the general ledger. Internal controls with respect to reporting were not operating effectively. Recommendation The County should implement procedures that require that the statutory reports be reconciled to the general ledger and reviewed and approved prior to being filed with the State. Views of Responsible Qficials and Planned Corrective Action Management concurs with the recommendations of the auditors. On July 1, 2010, Collier County entered into a contract with Florida Housing Coalition, the technical assistance provider for Florida Housing Finance Corporation. The purpose was to receive assistance in reconciling the annual reports to the general ledger and establishing best practices to capture, reconcile, and report data. 1102- 1231314 185 Collier County, Florida Schedule of Findings and Questioned Costs (continued) Further recognizing the importance of compliance, transparency and overall proper management of grants, the County hired two grant accountants who will work under the management of our Grants Management Office. These two employees are being deployed to areas exhibiting the greatest need for assistance and will work with individual departments and existing employees to bring consistent compliance, policies and procedures as they relate to grant activities throughout the county. Currently, one of the Grant Accountants is working with the employees of Housing, Human and Veteran's Services Department on the SHIP report reconciliation. Expenditures have been reconciled to the general ledger and the corresponding journal entries and adjustments are being made. Future reports will also be reconciled and approved by the program administrator prior to being filed with the State. Finding 2010 -2 Federal Program In /ormation U.S. Department of the Interior Payments in Lieu of Taxes (PILT) CFDA No. 15.226 Criteria Reporting: Section 43 CFR Part 44.50 states the following - What are the local governments' responsibilities after receiving payments under this part? (a) The local government may use section 6902 payments for any governmental purpose (b) Within 90 days of receiving sections 6904 and 6905 payments, the local government must distribute the funds to the affected units of general local government and affected school districts. The affected units of general local government and school districts may use sections 6904 and 6905 payments for any governmental purpose. (c) The local government must distribute section 6904 and 6905 payments in proportion to the tax revenues assessed and levied by the affected units of general local government and school districts in the Federal fiscal year before the Federal Government acquired the entitlement lands. The Redwoods Community College District in California is an affected school district for this purpose. 1102-123 13 14 186 Collier County, Florida Schedule of Findings and Questioned Costs (continued) (d) Within 120 days of receiving payments, the local government must certify to the Department that it has made an appropriate distribution of funds. Condition /Context The County was not aware of the requirement noted in (d) above and did not certify to the Department that it had made an appropriate distribution of the funds within 120 days of receiving payments. Questioned Costs N/A Cause /Effect As the County was not aware of the requirement stated in the CFR, internal controls over reporting were not designed or operating effectively. Recommendation The County should implement procedures to identify all types of reporting requirements indicated in the federal regulations and to ensure all such reports or certifications are submitted as required and on a timely basis. Views of Responsible Qficiale and Planned Corrective Action The Clerk's Department of Finance and Accounting (Finance) determined that this program was considered a Federal grant in July 2010. At that time, Finance contacted the Department of Interior and was told that there were no reporting requirements for this program. All funds were properly distributed. Upon reviewing CFR 44.5(d) with the auditors, it was determined that a certification confirming the appropriate distribution of funds was required. The confirmation was sent and this requirement has been added to the PILT procedures for future years. 1102-123 13 14 187 Collier County, Florida Schedule of Findings and Questioned Costs (continued) Finding 2010 -3 Federal Program Inl6rination U.S. Department of Homeland Security Disaster Grants - Public Assistance (Presidentially Declared Disasters) CFDA No. 97.036 Criteria Procurement, Suspension and Debarment: Non - Federal entities are prohibited from contracting with or making subawards under covered transactions to parties that are suspended or debarred or whose principals are suspended or debarred. When a non - federal entity enters into a covered transaction with an entity at a lower tier, the non - federal entity must verify that the entity is not suspended or debarred or otherwise excluded. This verification may be accomplished by checking the Excluded Parties List System (EPLS) maintained by the General Services Administration (GSA), collecting a certification from the entity, or adding a clause or condition to the covered transaction with that entity. Condition /Context We selected the largest vendor included in the population which comprised the majority of the expenditures incurred under the Federal program for testing. The expenditures were incurred during prior years although the Federal reimbursement was sought and received in the current year. We noted no documentation evidencing that the County had checked the EPLS, and a certification from the vendor was not collected or clause or condition included in the contract. We noted that the County's current policy it to document the EPLS check; however, as this vendor contract pertained to prior years, there was no documentation of the EPLS check being performed. Questioned Costs N/A 1102-123 13 14 188 Collier County, Florida Schedule of Findings and Questioned Costs (continued) Cause /Effect Internal controls with respect to suspension and debarment were not operating effectively at the time the expenditures under the Federal program were incurred as no documentation was maintained indicating that the EPLS was checked. Additionally, there was no evidence that the County had obtained a certification from the entity or added a clause or condition to the contract with the entity. Therefore, we could not verify whether the County met its requirement to verify that the entities were not suspended or debarred or otherwise excluded. Recommendation The County should perform the required verification by checking the EPLS (and documenting evidence of the verification, when it was performed and by whom), collecting a certification from the entity, or adding a clause or condition to the contract with that entity in accordance with the Federal requirements. Views of Responsible Officials and Planned Corrective Action Management concurs with and has successfully implemented the procedure of performing EPLS checks on all vendors associated with grant activities. This contract was procured in July of 2005, prior to any damage done to Naples beaches and initial submission to FEMA for reimbursement. This contract bid process was intended for payment under non -grant revenue sources and accordingly, our procurement procedures do not require debarment checks for non - grant related vendors. The bid process did include the following language with regards to Public Entity Crimes: "By its submitting a Bid, Bidder acknowledges and agrees to and represents it is in compliance with the terms of Section 287.133(2)(a) of the Florida Statutes." Said statute prohibits a vendor from bidding on a contract when they have been convicted of a public entity crime. An after - the -fact EPLS check was performed on this vendor for the period of January 1, 2005 through and including September 30, 2010 and was found to be in good standing. At the time the County submits their second request for scope change with FEMA regarding the increased beach costs, all vendors submitted for reimbursement will be checked after - the -fact. 1102-123 13 14 189 Collier County, Florida Schedule of Findings and Questioned Costs (continued) Finding 2010 -4 Federal Program Information U.S. Department of Homeland Security Disaster Grants — Public Assistance (Presidentially Declared Disasters) CFDA No. 97.036 Criteria Reporting: The County received Federal program funds as a subgrantee of the State. Per review of the State's reporting guidelines, subgrantee quarterly financial reporting is required for all large projects to comply with program requirements and to allow the grantee to provide accurate progress reports, as required, to the Federal grantor agency. The compliance supplement requires that financial reports be complete and accurate, which includes a requirement that amounts reported be in agreement with accounting records that support the audited financial statements and the SEFA. Condition /Context For one of the two quarterly reports selected for testing on a large project we noted amounts were not reported accurately for the anticipated final amount and the amount expended to date. The accounting records reflected a total amount of $12.9 million whereas the report reflected $3.1 million. Further, we selected the next quarterly report and noted that the amounts reported were the same and had not been updated to reflect the actual activity based on the County's accounting records. Questioned Costs N/A CauselFf feet The reports submitted were not adequately reviewed to ensure accuracy and completeness. 1 102 - 1231314 190 Collier County, Florida Schedule of Findings and Questioned Costs (continued) Recommendation We recommend that all reports submitted to grantor agencies be subjected to a thorough supervisory review for accuracy and completeness prior to submission. Views of Responsible Officials and Planned Corrective Action The Florida Public Assistance quarterly reporting is done electronically without any intermittent check points for review. Management will work around this by having staff create a spreadsheet prior to quarterly reporting submission and submit to Management for approval. Staff inquired about submitting revised quarterly reports for the periods in question and was advised that there are no options for doing this within the system. Finding 2010 -5 Federal Program Information U.S. Department of Homeland Security Disaster Grants — Public Assistance (Presidentially Declared Disasters) CFDA No. 97.036 Criteria Allowable Activities /Costs: Following a Presidential declaration of a major disaster or an emergency, the Federal Emergency Management Agency (FEMA), Department of Homeland Security (DHS), awards grants for public assistance to States. The State uses the funds to provide subgrants to local governments. Accordingly, the County is the subgrantee. Public Assistance (PA) program awards are made based upon a Project Worksheet (PW) prepared by a project formulation team, which includes representatives of FEMA, the State and the subgrantee. The PW documents the project formulation team's determination of the eligible scope of work and cost estimate. Accordingly, the compliance supplement indicates that the allowed activities for the PA program are for the approved project as described on the PW and supporting documentation. For large projects, the State must make an accounting to FEMA of eligible costs for each approved large project. In submitting the accounting, the State must certify that reported costs were incurred in the performance of eligible work, that the approved work was completed, that the project is in compliance with the FEMA -State Agreement, and that payments for the project 1102- 1271313 191 Collier County, Florida Schedule of Findings and Questioned Costs (continued) have been made in accordance with 44 CFR section 13.21 requirements for payment. The subgrantee is required to make similar accounting and certifications to the State. If actual costs are less than the approved amount, then the FEMA share will be based upon the actual costs. The subgrantee may request additional funding for eligible cost overruns on large projects. For additional funding, these requests must include a written recommendation from the State and approval of the FEMA Regional Administrator (RA) (44 CFR sections 206.204(e) and 206.205). Condition /Context The large project PW that was finalized during fiscal year 2010 and which set forth the allowable activities and costs for the project included approximately $10.5 million for costs associated with one vendor and $2.2 million related to various other vendor related costs. The County was reimbursed under the Federal program for the full amount of the approved PW (approximately $3.1 million was collected in prior years and approximately $9.7 million was collected during fiscal year 2010). For the other vendors included in the PW totaling $2.2 million, we selected three of the largest vendors to test covering over 60% of the other vendor total amount. We noted that for one of the vendors selected, the amount billed by the vendor and paid by the County was less than the amount in the PW by $27,997, which at the Federal reimbursable share per the PW of 55% equates to $15,398. Since this amount is above the OMB Circular A -133 reportable threshold of $10,000, we have reported this amount as a questioned cost. Questioned Costs $15,398 Cause /Effect According to the Federal compliance supplement if actual costs are less than the approved amount, then the FEMA share should be based upon the actual costs. As the County received grant funds for the full amount approved in the PW, it appears that the amount reimbursed was not based upon the actual costs incurred for this particular vendor. Recommendation We recommend that the County implement procedures to ensure that amounts reimbursed are based upon actual expenditures incurred. 1102-123 13 14 192 Collier County, Florida Schedule of Findings and Questioned Costs (continued) Views of Responsible Officials and Planned Corrective Action As discussed in previous meetings, this Project Worksheet 2700 (PW) was the result of a scope change and Collier County was allowed a much larger reimbursement for the damages done to Collier County Beaches. This is an on -going process and involves three Named Events (Tropical Storm Gabrielle on 9/12/2001; Hurricane Katrina on 8/29/2005; and Hurricane Wilma on 10/24/2005). At 9/30/2010, Collier County was halfway through this process. The invoice selected for testing on this project was incorrectly referenced in the written discussion on PW 2700 by State personnel at $682,000, the PO amount. There is a spreadsheet that FEMA, State personnel and Collier personnel are working with for the entire $33.9 million dollar scope change. The actual invoice amount of $654,002.73 is included on the spreadsheet. Finding 2010 -6 Federal Program Information U.S. Department of Housing and Urban Development Community Development Block Grants /Entitlement Grants (CDBG) CFDA No. 14.218 Criteria Program Income: Revenue received by a state, unit of general local government, or subrecipient (as defined at 24 CFR 570.500(c)) that is directly generated from the use of CDBG funds (which term includes NSP grant funds) constitutes CDBG program income. To ensure consistency of treatment of such revenue, the definition of program income at 24 CFR 570.500(a) shall be applied to amounts received by states, units of general local government, and subrecipients. However, Section 2301(d)(4) imposes certain limitations and requirements that necessitate an alternative requirement to govern the use of program income generated by activities carried out pursuant to Section 2301(c). The limitations and requirements are based on the NSP activity that generated the program income and on the date the income is received. In addition, Section 2301(d)(4) requires any revenue from the sale, rental, redevelopment, rehabilitation or any other eligible use of NSP funds to be provided to and used by the state or unit of local general government. This includes revenue received by a private individual or other entity that is not a subrecipient. Program income received before July 30, 2013, may be retained by the state or unit of general local government if it is treated as additional CDBG funds and used in accordance 1102- 1231314 193 Collier County, Florida Schedule of Findings and Questioned Costs (continued) with the requirements of Section 2301. Furthermore, as provided under 24 CFR 85.21 for entitlements, grantees and subrecipients shall disburse program income before requesting additional cash withdrawals from the U.S. Treasury. Condition /Context We noted a total of approximately $732,000 of program income generated during fiscal year 2010 under the Neighborhood Stabilization Program (NSP) which is part of the CDBG program. Per review of the general ledger expenditure detail provided, we noted that the program income had been applied against specific program expenditures in determining the net amount of program expenditures reported in the SEFA. From the detail of program income provided, we selected a sample of specific program income transactions for testing and the first selection of approximately $66,000 was recorded in May 2010. The remaining five selections included in our sample were recorded during September 2010. There were no NSP program cash draws made subsequent to the receipt of the program income recorded in September 2010. We attempted to ascertain whether the amounts received as program income in May 2010 were properly offset against program expenditures in determining the amount of federal funds drawn for the next draw request occurring subsequent to the date the program income was received in order to satisfy the requirement that program income is used before requesting additional cash draws. However, we were informed that the May 2010 program income of $66,000 had not been deducting in subsequent cash draw requests made during fiscal year 2010. Questioned Costs N/A Cause /Effect It appears that NSP program income recorded in May 2010 was not used to offset expenditures prior to requesting additional cash draws. Recommendation We recommend that the County implement procedures to verify that program income received is properly offset against expenditures incurred when making draw requests under the federal program. 1102-1231314 194 Collier County, Florida Schedule of Findings and Questioned Costs (continued) Views of Responsible Officials and Planned Corrective Action Collier County concurs with the recommendation. Prior to making a request to draw new funds under NSP, County fiscal staff will submit evidence to the program administrator that all program income received will be, or has been, offset against expenditures. This requirement will apply regardless of what NSP activity generated the program income or what activity Collier County seeks to draw down against available program funds. Finding 2010 -7 Federal Program Imormation U.S. Department of Housing and Urban Development Community Development Block Grants /Entitlement Grants (CDBG) CFDA No. 14.218 Criteria Reporting: Per the NSP program regulations contained in the Federal Register, each grantee must submit a quarterly performance report, as HUD prescribes, no later than 30 days following the end of each quarter, beginning 30 days after the completion of the first full calendar quarter after grant award and continuing until the end of the 15th month after initial receipt of grant funds. In addition to this quarterly performance reporting, each grantee will report monthly on its NSP obligations and expenditures beginning 30 days after the end of the 15th month following receipt of funds, and continuing until reported total obligations are equal to or greater than the total NSP grant. After HUD has accepted a report from a grantee showing such obligation of funds, the monthly reporting requirement will end and quarterly reports will continue until all NSP funds (including program income) have been expended and those expenditures are included in a report to HUD. The compliance supplement requires that perfonnancc reports are complete and accurate. Condition /Context We selected two quarterly reports for the NSP program to test and noted that amounts reported for expenditures did not agree to the County's general ledger and a reconciliation was not provided. 1102-1231314 195 Collier County, Florida Schedule of Findings and Questioned Costs (continued) Questioned Costs N/A Cause /Effect The reports submitted were not subjected to a thorough supervisory review to ensure accuracy and completeness, including verification that amounts reported agreed to the accounting records or were appropriately reconciled, if necessary. Recommendation The County should implement procedures that require that the NSP reports be reconciled to the general ledger and reviewed and approved prior to being filed with the grantor. Views of Responsible Officials and Planned Corrective Action Collier County concurs with the recommendation. Program staff will ensure expenditures and program income have been reconciled to the general ledger. This item has been corrected and appropriate controls and procedures have been implemented to reconcile to the general ledger betbre submitting future Quarterly Performance Reports (QPR) to the grantor agency. Furthermore, future reports will be approved by the program administrator and appropriate documentation will be maintained prior to being tiled with the grantor agency. 1 102 - 1231314 196 Collier County, Florida Schedule of Prior Audit Findings For the Year Ended September 30, 2010 The current status of findings reported for the years ended September 30, 2009 and 2008 related to major federal programs and state projects is as follows: Finding 2009 -1 Federal /State Program Information Federal Agencies /Programs: U.S. Department of Housing and Urban Development (HUD) Home Investment Partnerships Program (HOME) CFDA No. 14.239 Community Development Block Program (CDBG) -- CFDA No. 14.218 U.S. Department of Health and Human Services Aging Cluster (AC) — CFDA No.'s 93.044, 93.045, 93.053, 93.705, 93.707 State Agencies /Programs: Florida Department of Elder Affairs Community Care for the Elderly (CCE) — CSFA No. 65.010 Florida Housing Finance Corporation State Housing Initiatives Partnership Program (SHIP) — CSFA No. 52.901 Compliance Requirement: Allowable Costs Condition /Context We noted that from the beginning of the fiscal year through January 2009, the County's documentation supporting payroll allocations for employees that work on multiple grants did not meet federal standards as described in OMB Circular A -87 above. The County has used a Personnel Activity Report (PAR) to allocate payroll salaries for employees who work on multiple activities. These reports are prepared annually, at the beginning of each fiscal year, based on an estimate of the time the employees arc expected to work on a grant. The PAR does not show the total activity for which an employee is compensated and does not require the employee's signature. 1 102 -12313 14 197 Collier County, Florida Schedule of Prior Audit Findings (continued) The County's Department of Housing and Human Services initiated a timesheet process in fiscal year 2006 whereby employees in the department indicate the projects to which their time relates each week. These timesheets are signed by the employees and supervisors and kept in the department for internal control purposes. For the first part of fiscal year 2009, these timesheets were not provided to the County's payroll department to adjust the allocation of payroll costs from the estimate as indicated in the annual PAR form to actual time spent. Thus, there is not an "after the fact" accounting based on actual activity. We noted that the HOME program had no payroll expenditures charged to the program during the period noted above (although there should have been), and therefore, no question costs have been reported for this program. The payroll charges related to the HOME program were instead charged to other housing programs as a result of the lack of an after the fact accounting for the period noted above. Recommendation The County should ensure that an effective and consistent process is in place to record payroll charges to grant programs throughout the entire fiscal year. The process should entail providing the timesheets to the payroll department on a periodic basis to match the related payroll allocated to each grant (as based on the PAR), to the actual time spent working on the federal /state grant based on the after - the -fact timesheet, and any adjustments necessary to true -up the estimated payroll charged to the grant (based on the PAR) to the actual amount (based on the timesheets) should be made. Alternatively, the payroll department could charge payroll costs to the grants based on actual timesheets submitted weekly as opposed to using the budgeted PAR percentage as the basis for allocating costs each pay period. PAR reports should be signed by the employee and completed at least semi - annually for those employees who work solely on one grant. Views of Responsible Officials and Planned Corrective Action The finding in question occurred during the I" quarter of FY09. The time was tracked correctly; however, a manual step was missed. Effective January 17, 2009, the Human Resources Department began processing bi- weekly time and effort entries for all Housing and Human Services grant staff. Staff submits timesheets that are signed by the employee and management to fiscal staff for review. The timesheets are forwarded to Human Resources to enter the actual percentage of time and effort into SAP prior to payroll expenses actually posting to SAP. This allows for "real time" charges directly to the appropriate grant in SAP, thereby eliminating the need to process journal entries at all. 1102 - 1231314 198 Collier County, Florida Schedule of Prior Audit Findings (continued) Current Status Currently, all Housing, Human and Veterans staff members who work on grants submit bi- weekly timesheets that are signed by the employee and management for fiscal staff for review. The timesheets are forwarded to Human Resources to enter the actual percentage of time and effort into SAP prior to payroll expenses actually posting to SAP. This allows for "real time" charges directly to the appropriate grant in SAP, thereby eliminating the need to process journal entries at all. Finding 2009 -2 Federal Program Information Federal Agency /Program: U.S. Department of Housing and Urban Development (HUD): Community Development Block Grant / State's Program (DR[) - CFDA No. 14.228 U.S. Department of Agriculture: Summer Food Service Program for Children— CFDA No. 10.559 U.S. Department of Justice: Public Safety Partnership and Community Policing Grants — CFDA No. 16.710 U.S. Department of Homeland Security: Homeland Security Cluster — CFDA No. 97.004, 97.067 U.S. Department of Transportation: Airport Improvement Program— CFDA No. 20.106 Compliance Requirement: Procurement, Suspension and Debarment Condition /Context Although the County indicated that its practice is to check the EPLS system, no documentation evidencing that it had checked the EPLS was maintained, and a certification from the entity was not collected or clause or condition included in the agreements, as applicable, for certain sample transactions selected for testing. 1102 - 1231314 199 Collier County, Florida Schedule of Prior Audit Findings (continued) Recommendation The County should perform the required verification by checking the EPLS (and documenting evidence of the verification, when it was performed and by whom), collecting a certification from the entity, or adding a clause or condition to the contract with that entity in accordance with the Federal requirements. Views of Responsible Officials and Planned Corrective Action Collier County will apply currently enacted controls and measures operating effectively in one division agency -wide to ensure compliance. The Grants Coordinator for the Collier County Sheriffs Office will be responsible for checking EPLS and documenting the verification as recommended above for all Sheriffs grants with this requirement. Current Status At Housing, Human and Veteran Services, debarment certification letters are required for new sub recipients as part of the grant application submission process. A sub recipient folder checklist ensures compliance. Assigned Grant Coordinators or staff members check all sub recipients, vendors and contractors against the EPLS listing. Screen Prints of EPLS listing are made to prove verification and are included in the file. At Parks & Recreation, the Department Operations Manager checks the EPLS and places the verification in the fiscal records associated with the project. Collier County Department of Emergency Management- Administrative Assistant checks EPLS and documents the verification. It has also been our practice to utilize GSA vendor sources where applicable further ensuring appropriate use of federal funds. Airport Authority personnel check the EPLS web site (https: / /www.cpls.gov /epls /search.do) and print documentation as verification for each vendor. This documentation will be initialed, scanned and attached to the requisition electronically within the counties accounting system. The Grants Coordinator for the Collier County Sheriffs Office checks EPLS and documents the verification as required for all Sheriffs grants. 1102-123 1314 200 Collier County, Florida Schedule of Prior Audit Findings (continued) Finding 2009 -3 State Program Information Florida Housing Finance Corporation (the Corporation) State Housing Initiatives Partnership Program (SHIP) CSFA No. 52.901 Criteria: Reporting Condition /Context The financial information included in the submitted Annual Report was not reconciled to the County's general ledger. Accordingly, we were unable to validate the amount of expenditures and program income reported in the Annual Report. Additionally, we noted approximately $192,000 of reversal entries appearing in the detail we were provided of SHIP projects completed during fiscal year 2009 and we were informed that these credits represented prior period corrections dating back as far as 2003. Recommendation The County should implement procedures that require that the statutory reports be reconciled to the general ledger and reviewed and approved prior to being tiled with the State. Additionally, should corrections to prior period expenditures be necessary, a process should be in place to ensure that such items are identified and captured on a timely basis. Views of Responsible Officials and Planned Corrective Action Management concurs with the recommendations. Recognizing that internal attempts at completing this difficult reconciliation have fallen short of the requirement, Housing and Human Services has budgeted SHIP grant funds to receive onsite and offsite technical assistance (TA) from the Florida Housing Coalition (FHC). FHC is the technical advisor designated by the grantor agency, Florida Housing Finance Corporation. The TA will consist of reviewing current reconciliation procedures, reports and data collection and maintenance. Any suggested improvements will be implemented. As of this writing, the contract for TA is being review by Housing and Human Services and the County Attorney's Office for Form and legal sufficiency. 1102 - 1231314 201 Collier County, Florida Schedule of Prior Audit Findings (continued) Current Status Collier County is currently under contract with the Florida Housing Coalition (FHC) to receive the technical assistance (TA) described above; a copy of the contract for TA is available for review. On July 1, 2010, Collier County met with the FHC consultant. The consultant advised Collier County to reconcile the annual reports of three fiscal years: 2008/2009, 2007/2008, 2006/2007 and submit them by June I, 2011. Once the reconciliation is complete and best practices are implemented, financial reports will be adjusted as needed and resubmitted to the Florida Housing Finance Corporation (FHFC). In addition, the County has hired two Grants Accountants whose role will be to act as internal auditors to ensure best practices are being implemented for all of the County's grants. Also see finding 2010 -1 above. Finding 2009 -4 State Program Information Florida Housing Finance Corporation (the Corporation) State Housing Initiatives Partnership Program (SHIP) CSFA No. 52.901 Criteria: Special Tests and Provisions Condition /Context No advertisement was made for fiscal year 2009. Recommendation The County should adhere to the established SHIP rules with respect to advertising SHIP funds. Views of Responsible Officials and Planned Corrective Action The County will adhere to the established SHIP rules. 1102 - 1231314 202 Collier County, Florida Schedule of Prior Audit Findings (continued) Current States The availability of SHIP FY08 -09 funding was published on March 5, 2010. An Affidavit of Publication is available for review. Finding 2009 -5 State Program Information Florida Department of Transportation (FDOT) State Infrastructure Bank (SIB) Loan Program CSFA No. 55.020 Criteria: Reporting Condition /Context The State compliance supplement for this program and the loan agreement require the submission to FDOT of semi - annual progress reports on program and financial activities that occur each year following the award. We noted that reports for December 2008 and June 2009 were not completed or submitted to the FDOT until the time of our testing (September 2009). Recommendation The County should review agreements for reporting requirements and if questions arise as to party responsible for completion, the County should promptly seek written clarification from the grantor agency. Also, the County should ensure that reports are reviewed for accuracy and completeness by someone other than the preparer. Views of Responsible Officials and Planned Corrective Action Originally the SIB agreement was for road construction considered to be a local Collier County project. After the SIB agreement was executed, Federal Highway Administration (FHWA) determined that the project would become a state project due to the procurement for a Design Build Finance of 1 -75 (IROX). Collier's original local project became part of larger state IROX project. 1102-123 13 14 203 Collier County, Florida Schedule of Prior Audit Findings (continued) The Grants Coordinator made a verbal inquiry to Florida Department of Transportation (FDOT) during calendar year 2008 regarding the reporting requirements cited in the SIB agreement and was advised the report was not Collier's responsibility since the project was not let by Collier nor would any portion of the project be managed by Collier as originally anticipated. Subsequently, a report was requested by FDOT for only the most recent six month period. Collier explained to FDOT that if the report was now required, all reports due during the fiscal year 2009 would need to be drafted and submitted as due diligence. All reports submitted were reviewed by the Transportation Administrator though not formally documented as such. Subsequent report reviews by the Transportation Administrator are documented before submission. Collier has no access to FDOT's financial activity or financial system which is needed to complete the report, nor does Collier receive any project status reports on a routine basis. Collier only has access to the data on the amount of loan payback which Collier disburses. This loan payment information can be populated by FDOT as well. Collier must request financial activity and project status information proactively. Requests for data from the grantor on prior year single audit reporting and CAFR data such as loan amortization schedules and project statuses to capture asset valuation has proven to be cumbersome and difficult. Future financial activity requests will be made within 10 business days after the semi - annual report period end to FDOT in order to verify and obtain correct data by the submission date. The Division will prepare the report based on the information provided by FDOT. Prior to submission, the Transportation Administrator will performi a documented review. Current Status The Growth Management Division (formerly Transportation Division) continues to follow the corrective action procedure as outlined above. The Acting Grants Accountant drafts the SIB report in coordination with FDOT and then submits the report for review and approval by the Division Administrator prior to final submission to FDOT by the required deadline. 1102-123 13 14 204 Collier County, Florida Schedule of Prior Audit Findings (continued) Finding 2009 -6 Federal Program Information Federal Agency /Program: U.S. Department of Transportation: Airport Improvement Program - CFDA No. 20.106 Criteria: Davis -Bacon Act Condition /Context We noted a project during fiscal year 2009 that was subject to the Davis -Bacon requirements. We noted that the required prevailing wage clauses were not included in the contract and the weekly certified payrolls had not been submitted as required. We were informed that the County planned to obtain the certified payrolls upon project completion; however, the requirements dictate that weekly certified payrolls are to be submitted during the course of the project. Recommendation The County should ensure that the required prevailing wage clauses are included in all contracts subject to the Davis -Bacon Act and that the required weekly certified payrolls are obtained. Views of Responsible Officials and Planned Corrective Action In order to rectify this deficiency Airport Authority personnel will review payroll submittals and provide documentation to assure compliance with the Davis -Bacon Act. Additionally personnel will work with any consultants and purchasing to include proper language in bids and contracts. In addition our procedure manual will be updated. Current Status The proper contract language regarding Davis -Bacon is now included in bids and contracts. The Airport Authority Consultants will examine the payroll statements provided and certified by the contractor, determine whether such wages comply with the locally prevailing wages as incorporated in and made part of the contract bid, and to document such determination. The Airport will subsequently perform its own examination, determination and documentation by making a notation on each payroll statement stating that the wages paid by the contractor have been reviewed and that they are /are not in compliance. 1102-123 13 14 205 Collier County, Florida Schedule of Prior Audit Findings (continued) Finding 2008 -1 Federal /State Program inf n-mation Federal Agency: US Department of Housing and Urban Development (HUD) Home Investment Partnerships Program (HOME) CFDA No. 14.239 Community Development Block Program (CDBG) — CFDA No. 14.218 State Agency: Florida Housing Finance Corporation State Housing Initiatives Partnership Program (SHIP) - CSFA No. 52.901 Compliance Requirement Allowable Costs Condition /Context We noted that for the majority of fiscal year 2008, the County's documentation supporting payroll allocations for employees that work on multiple grants did not meet federal standards as described in OMB Circular A -87 above. The County has used a Personnel Activity Report (PAR) to allocate payroll salaries for employees who work on multiple activities. These reports are prepared annually, at the beginning of each fiscal year, based on an estimate of the time the employees are expected to work on a grant. The PAR does not show the total activity for which an employee is compensated and does not require the employee's signature. The County's Department of Housing and Human Services (the department responsible for the administration of the HUD grants) initiated a timesheet process in fiscal year 2006 whereby employees in the department indicate the projects (HOME, SHIP, or CDBG) to which their time relates each week. These timesheets are signed by the employees and supervisors and kept in the department for internal control purposes. For the majority of fiscal year 2008, these timesheets were not provided to the County's payroll department to adjust the allocation of payroll costs from the estimate as indicated in the annual PAR form to actual time spent. Thus, there is not an "after the fact" accounting based on actual activity. Recommendation We recommend that the County continue to use the timesheet process implemented during fiscal year 2006 whereby the employees and a supervisor sign each timesheet. In addition, the County should implement a process to provide the timesheets to the payroll department on a periodic basis to match the related payroll allocated to each grant (as based on the PAR), to the actual time spent working on the federal /state grant based on the after- the -fact timesheet, and any 1 102 - 1231314 206 Collier County, Florida Schedule of Prior Audit Findings (continued) adjustments necessary to true -up the estimated payroll charged to the grant (based on the PAR) to the actual amount (based on the timesheets) should be made. Alternatively, the payroll department could charge payroll costs to the grants based on actual timesheets submitted weekly as opposed to using the budgeted PAR percentage as the basis for allocating costs each pay period. PAR reports should be signed by the employee and completed at least semi - annually for those employees who work solely on one grant. Planned Corrective Action Effective July 1, 2008, all grant staff were required to complete bi- weekly timesheets indicating the amount of hours spent on each grant. This timesheet is signed by the employee and the employee's supervisor. Journal entries are then made by fiscal staff to charge actual time and effort worked to the appropriate grant. In an effort to mitigate this finding even further, effective January 1, 2009, the Human Resources department began processing bi- weekly time and effect entries for all Housing and Human Services grant staff. Staff will continue to complete their bi- weekly timesheets. The timesheets will be sent to Human Resources to enter the actual time into SAP prior to the payroll actually posting to SAP. This will allow for actual time spent to be charged directly to the appropriate grant in SAP, thereby eliminating the need to process journal entries at a later date. Current Status Since January 17, 2009, the Human Resources Department began processing bi- weekly time and effort entries for all Housing, Human and Veteran Services grant staff. Staff submits timesheets that are signed by the employee and management to fiscal staff for review. The timesheets are forwarded to Human Resources to enter the actual percentage of time and effort into SAP prior to payroll expenses actually posting to SAP. This allows for "real time" charges directly to the appropriate grant in SAP, thereby eliminating the need to process journal entries at a later date. 1 102 - 1231314 207 Collier County, Florida Schedule of Prior Audit Findings (continued) Finding 2008 -2 Federal Program Information U.S. Department of Justice State Criminal Alien Assistance Program (SCAAP) — CFDA No. 16.606 Compliance Requirement: Reporting Condition /Context In addition to overtime which appears to be allowable based on the information stated in the original finding, the County included wage benefits (i.e. incentives, training costs, retirement, group life and health insurance, and workers compensation) totaling $6.5 million in the calculation of total correctional salaries reported in the SCAAP grant application for the FY 2007 SCAAP grant. Also, the number of certified correctional officers employed during the reporting period reported in the application of 321 was overstated by 65 due to vacant positions being erroneously included in the amount submitted in the application. Recommendation We understand from the Sheriffs personnel that benefits were appropriately excluded from the FY 2008 SCAAP award application. In the future, we recommend that the Sheriff review program guidelines and contact the grantor agency if reporting criteria are not clearly stated or if clarification is needed in interpreting information contained in the program guidelines. Written documentation from the grantor agency should be retained to support any such correspondence. Additionally, a thorough review of future applications should be made in order to detect potential crrors such as with respect to the number of correctional officer positions reported as noted above. Planned Corrective Action As stated in the recommendation, the calculation was changed for the FY2008 application. We concur with this recommendation to contact the grantor agency in writing, if reporting criteria are not clearly stated or if clarification is needed in interpreting information contained in the 1102-1231314 208 Collier County, Florida Schedule of Prior Audit Findings (continued) program guidelines. We do believe, having dealt with this grant for many years, that there have been years in which the criteria for calculation could be interpreted differently by different parties. Documentation has not always been clear in establishing guidelines. Current Status In January, 2010 CCSO returned $622,510 to the US Department of Justice (DOJ) as a result of DOFs audit of the SCAAP 2007 application. In April, 2010 DOJ reduced the SCAAP 2009 award by $791,555 as a result of their audit of the SCAAP 2006 application. Finding 2008 -3 Federal Program Information Federal Agency /Program: U.S. Department of Housing and Urban Development (HUD): Community Development Block Grant / State's Program (DRI) -- CFDA No. 14.228 U.S. Department of Transportation: Highway Planning and Construction Federal Transit Cluster - CFDA No. 20.500 / 20.507 Compliance Requirement: Procurement, Suspension and Debarment Condition /Context Although the County indicated that its practice is to check the EPLS system, no documentation evidencing that it had checked the EPLS was maintained, and a certification from the entity was not collected or clause or condition included in the agreements, as applicable, for certain sample transactions selected for testing. Recommendation The County should perform the required verification by checking the EPLS (and documenting evidence of the verification, when it was performed and by whom), collecting a certification from the entity, or adding a clause or condition to the contract with that entity in accordance with the Federal requirements. Planned Corrective Action Management concurs with this finding. 1102-123 13 14 209 Collier County, Florida Schedule of Prior Audit Findings (continued) While the Department of Housing and Human Services (HHS) has always checked vendors against the EPLS listing; this check did not include non -profit subrecipients. As of December 2008, HHS now requires current audit reports and debarment certification letters for all subrecipients as part of the grant application submission process. Once awards are made, the assigned Grant Coordinator is responsible for checking all subrecipients, vendors and contractors against the EPLS listing. Screen prints of the EPLS listing are made to prove verification and are included in the file. Debarment and audit reports have also been included in the Master File Checklist which is included in the file folder and reviewed by the Grants Manager. The Transportation Division has started a new procedure during FY09 where all grant related purchase orders will be approved by the Grants Coordinator. At the time of review for approval, the Grants Coordinator performs verification that the vendor has not been suspended or debarred or otherwise excluded at the EPLS website. The verification is printed and maintained in the grant procurement tile. In addition, current procedures include federal clause language and a written certification for all federal transit grant procurements over $50,000. Other steps are taken by the Purchasing Department at the time of advertisement of bids and requests for proposals that include review of each project to determine if grant funding is involved and whether there are specific compliance issues related to debarment. Forms are provided to vendors requiring they certify they are not on the Excluded Parties List. Furthermore, departments managing grants have been provided a link on the Purchasing Department website to the EPLS website so they can complete their own verification. Current Status Housing, Human and Veteran Services requires debarment certification letters for new sub recipients as part of the grant application submission process. A sub recipient folder checklist ensures compliance. Assigned Grant Coordinators or staff members check all sub recipients, vendors and contractors against the EPLS listing. Screen Prints of EPLS listing are made to prove verification and are included in the file. Growth Management Division (formerly Transportation Division) continues to conduct EPLS checks as part of the grant requisition process prior to commitment of any federal grant funding. The grant requisition is routed to the Acting Grants Accountant for review and verification the EPLS check is completed and compliant. Also see finding 2009 -2 above. 1 102 - 1231314 210 Collier County, Florida Schedule of Prior Audit Findings (continued) Finding 2008 -4 Federal Program Information U.S. Environmental Protection Agency Capitalization Grants For Drinking Water State Revolving Funds (SRF) - CFDA No. 66.468 Compliance Requirement: Allowable Costs Condition /Context We reviewed all of the invoices supporting the loan expenditures reported and noted two invoices for consulting services dated in August 2008 totaling $12,942 included in the August 28, 2008 disbursement request that had not been reviewed and approved by the related Project Manager prior to seeking reimbursement under the loan program. We did not identify any discrepancies or exceptions in our compliance testing. Recommendation We recommend that all invoices be properly reviewed and approved to ensure that they are allowable costs prior to being charged to the loan program. Planned Corrective Action Public Utilities initiated a procedure for grants in December 2008 that now includes adding the Accounting Technician's name to the SRF transmittal sheet. The Accounting Technician verifies whether all the invoices are properly approved and are paid. After this approval, it goes to the Project Manager, Director and the Administrator for approval of the disbursement request. Current Statics The procedure noted above was implemented in December 2008, and continues to be in effect. 1102 - 1231314 211 Collier County, Florida Schedule of Prior Audit Findings (continued) Finding 2008 -5 State Program Lnformation Florida Housing Finance Corporation (the Corporation) State Housing Initiatives Partnership Program (SHIP) CSFA No. 52.901 Compliance Requirement: Reporting Condition /Context The financial information included in the submitted Annual Report was not reconciled to the County's general ledger. Accordingly, we were unable to validate the amount of expenditures and program income reported in the Annual Report. Recommendation The County should implement procedures that require that the statutory reports be reconciled to the general ledger and reviewed and approved by finance department staff prior to being tiled with the State. Planned Corrective Action The Department of Housing and Human Services recognizes the importance of reconciling statutory reports, internal staff reports, and the general ledger. Procedures were implemented following the FY07 audit. While these procedures greatly improved the accuracy and accountability of the statutory and internal staff reports, they did not account for the point -in- time nature of the statutory reports. To effectively control for, and document, the complete reconciliation of the statutory reports and general ledger, the Department of Housing and Human Services will produce a "screen shot" from within the general ledger software (SAP) to be included with the statutory report. The purpose of this activity is to document the status of funds during the reporting timeframe. Prior to submitting statutory reports, the Department of Housing and Human Services will provide a copy of the report to the Clerk of Courts Finance Department for review. Approval of the statutory report lies with the Board of County Commissioners. 1102- 1231314 212 Collier County, Florida Schedule of Prior Audit Findings (continued) Current Status Collier County is currently under contract with the Florida Housing Coalition (FHC) to receive the technical assistance (TA) described above; a copy of the contract for TA is available for review. On July 1, 2010, Collier County met with the FHC consultant. The consultant advised Collier County to reconcile the annual reports of three fiscal years: 2008/2009, 2007/2008, 2006/2007 and submit them by June 1, 2011. Once the reconciliation is complete and best practices are implemented, financial reports will be adjusted as needed and resubmitted to the Florida Housing Finance Corporation (FHFC). In addition, the County has hired two Grants Accountants whose role will be to act as internal auditors to ensure best practices are being implemented for all of the County's grants. Also see finding 2009 -3 and 2010 -1 above. Finding 2008 -6 Federal Program In /brmation U.S. Department of Housing and Urban Development (HUD) Community Development Block Grant / State's Program (DRI) CFDA No. 14.228 Compliance Requirement: Reporting Condition /Context This federal grant is passed through to the County from the State of Florida, Department of Community Affairs (the Department). The grant agreement between the Department and the County sets forth various reporting requirements. We noted that the County completed the required reports, as applicable, during fiscal year 2008, and we did not note any discrepancies. However, there was no evidence that a review as to accuracy and completeness took place for certain reports submitted to the Department (i.e. Contractual Obligation and MBE Report, Projection of Contract Payments Form and Disaster Quarterly Status Report). 1102-123 13 14 213 Collier County, Florida Schedule of Prior Audit Findings (continued) Recommendation The County should implement procedures whereby review by someone other than the preparer is obtained to help ensure completeness and accuracy of the reports submitted to the Department. Such reviews and approvals should be documented to evidence that the review took place. Planned Corrective Action The Department of Housing and Human Services has implemented procedures to ensure all reports are reviewed for accuracy prior to submission to the Department of Community Affairs. Once prepared, reports are reviewed for errors and /or omissions by the Housing Manager. Once approved as accurate, the Housing Manager signs the report to indicate completed review. Copies of signed reports are maintained by staff of the Department of Housing and Human Services. Current Status The Housing Manager continues to review, sign, and approve all reports prior to submission to the Florida Department of Community Affairs. i 102-123 13 14 214 JERNST &YOUNG I r Ernst & Young LLP i Li; r�f . aH6 Management Letter and State Reporting Requirements Members of the Board of County Commissioners Collier County, Florida: We have audited the financial statements of the governmental activities, the business -type activities, the aggregate discretely presented component units, each major fund, and the aggregate remaining fund information of Collier County, Florida as of and for the year ended September 30, 2010, which collectively comprise Collier County, Florida's basic financial statements and have issued our report thereon dated February 22, 2011. We conducted our audit in accordance with auditing standards generally accepted in the United States of America; the standards applicable to financial audits contained in Government Auditing Standards, issued by the Comptroller General of the United States; and OMB Circular A -133, Audits of States, Local Governments, and Non- Profit Organizations. We have issued our Report of Independent Certified Public Accountants on Internal Control over Financial Reporting and Compliance and Other Matters Based on an Audit of the Financial Statements Performed in Accordance with Government Auditing Standards, Report of Independent Certified Public Accountants on Compliance with Requirements That Could Have a Direct and Material Effect on each Major Federal Program and State Project and on Internal Control over Compliance in Accordance with OMB Circular A -133, Section 215.97, Florida Statutes and Chapter 10.550, Rules of the Auditor General, and Schedule of Findings and Questioned Costs. Disclosures in those reports and schedule, which are dated February 22, 2011, should be considered in conjunction with this management letter. Additionally, our audit was conducted in accordance with the provisions of Chapter 10.550, Rules of the Auditor General, which govern the conduct of local governmental entity audits performed in the State of Florida. We have the following suggestions for improvement in accounting procedures and controls. 1102 - 1231597 11111;Illllli��' "'.... JERNST &YOUNG A. CURRENT YEAR FINDINGS AND RECOMMENDATIONS 2010 -1 Grant Reporting Controls (Sheriff's Office) Observation During our single audit testing over reporting requirements for the "Recovery Act Edward Byme Memorial Justice Assistance Grant (JAG) Program/Grants to States and Territories" federal program, we noted that for one of the quarterly performance reports during fiscal year 2010 sampled that the expenditures were overstated by approximately $2,850. The report covered the three month period ended June 30, 2010 and erroneously included March 2010 expenditures which had been previously reported in the performance report covering the prior three months ended March 31. 2010. We also noted that there was no evidence of reports submitted to the grantor agency being reviewed prior to submission by someone other than the preparer for accuracy and completeness. Recommendation We recommend that all reports submitted to grantor agencies be subjected to a supervisory review for accuracy and completeness prior to submission. The preparer and the reviewer should sign -off on the report and a copy should be retained in the file to provide evidence that the report was properly reviewed. Management's Response The expenditures on the quarterly reports are a compilation of the monthly claims which have been submitted to the grantor. Monthly claims are reviewed and approved by the Finance Director prior to submission. The report for the period ended June 30, 2010 inadvertently included one expenditure from the prior reporting period. It should be noted that all expenditures were accurately reported in the final closeout report for the grant. A spreadsheet is maintained which details expenditures for the grant claims and provides documentation for what is submitted on the quarterly reports. Because all required reports are directly submitted online, the spreadsheet will serve as a review document for the input for the submitted expenditure information. The preparer and the reviewer will sign -off on the spreadsheet. The submitted report will be compared to the spreadsheet to ensure correct information was reported to the grantor. 1102- 1231597 2 JERNST&YOUNG 2010 -2 Subrecipient Agreements — ARRA Requirements Observation OMB Circular A -133 guidelines require that pass - through entities separately identify to each Subrecipient, and document at the time of the subaward and disbursement of funds, the Federal award number, CFDA number, and the amount of American Recovery and Reinvestment Act (ARRA) funds; and require their subrecipients to provide appropriate identification in their Schedule of Expenditures of Federal Awards (SEFA) and Data Collection Form (SF -SAC). For certain ARRA federal programs tested during our single audit (i.e. Community Development Block Grant ARRA Entitlement Grants and Homelessness Prevention and Rapid Re- Housing Program) for which the County made awards to Subrecipient organizations, we noted that the agreements with the subrecipients provided the required information regarding the awards and indicated that "the Subrecipient shall maintain all records required by ARRA." However, they did not explicitly indicate that the subrecipients are to appropriately identify the ARRA funds in their SEFA and SF -SAC. Recommendation We recommend that the County update its standard form of Subrecipient agreement to explicitly state the requirement to provide appropriate identification of ARRA funds in the SEFA and SF -SAC. Management's Response The Collier County Department of Housing, Human & Veteran Services (HHVS) concurs with this audit observation and agrees to amend its American Recovery and Re- Investment Act (ARRA) grants to more specifically outline the Schedule of Expenditures of Federal Awards (SEFA) and the Data Collection Form (SF -SAC) reporting requirement for its subrecipients. The amendment will be made to all Homelessness Prevention and Rapid Re- Housing Program (HPRP) and Community Development Block Grant- Recovery (CDBG -R) subrecipient grant agreements. B. STATUS OF PRIOR YEAR RECOMMENDATIONS 2009 -1 Fixed Assets Observation In previous years, the County capitalized large projects in lump sum amounts instead of specifically identifying each asset and capitalizing separately. As a result, if individual items within a large project, such as waterslides within a total "Park" capital asset balance, are 1102 - 1231597 3 J ERNST &YOUNG replaced, the individual item cannot be identified for proper disposal and replacement. Over time, differences between the carrying value of the replaced asset and the carrying value of the new asset can grow to be significant affecting depreciation expense and gains or losses upon disposition of assets. Recommendation We recommend the County implement a policy requiring all assets be accounted for individually in order to correctly calculate depreciation based on the correct expected life, and to allow for better tracking of all assets. Management's Response and Corrective Action Plan Management strives to capitalize assets in a manner that allows individual identification. However, componentization of certain capital assets is an acceptable practice and supported within the GAAP hierarchy. Subsequent replacement of such a componentized capital asset would then have to be expensed as a repair. Management will clarify this in their policies and procedures. Current year status: Management continues to evaluate capital expenditures to determine the appropriate components to add to the capital assets. 2009 -2 Goods Receipt Observation Certain prior year goods receipts were not reversed in a timely fashion in the County's financial system. As such expenditures and liabilities were overstated as of the end of the prior fiscal year. This can occur when a goods receipt is recorded and the related invoice receipt is not processed to clear the transaction. If this is not corrected at year end, reversal in the subsequent fiscal year results in a system generated entry that reduces the liability and expenditure. Since this entry results in additional budget, a manual entry is concurrently processed to reclassify the reduction in expenditure to an increase in miscellaneous revenue. The net effect on expenditures is zero and miscellaneous revenue is overstated. Recommendation Departments should be held accountable for analyzing outstanding goods receipts at year end to ensure all unapplied goods receipted in SAP are investigated in a timely manner. This should take place as part of the annual year -end close process to ensure accurately reporting these expenses in the year incurred. 1102 - 1291597 4 JERNST&YOUNG Management's Response and Corrective Action Plan Management concurs with this continent. Staff has developed additional reporting tools that have been provided to user departments. These reports will allow users to continually monitor their outstanding goods receipts. This will ensure that expenditures and liabilities are properly stated at the end of the fiscal year. Current year status: The new report has made it easier for departments to identify goods receipts that have not had a corresponding invoice receipt document processed. This report combined with an emphasis from management to resolve issues timely has resulted in a more accurate reporting of expenditures and liabilities throughout the year. 2009 -3 Other Postemployment Benefits Observation The County does not appear to perform due diligence over the actuarial results in which information would be verified between data provided to the actuary by the County's claim processor third -party administrator (Meritain), County Risk Management and the Clerk's Finance Department. The lack of review and verification of the underlying data given to the actuary could result in a material misstatement in the Other Post Employment Benefits liability and other accrued liabilities, such as Voluntary Separation Incentive Program pay -outs. Recommendation The County should perform verification checks between the Valuation Report and underlying data, such as verifying: the pay as you go expense, number of retirees, number of active participants, etc. In addition, County Human Resources, County Risk Management, County Management and the Clerk's Finance Department as well as the third party actuary and claim processor should be involved when discussing underlying assumptions, processes and plans for the valuation. This will enhance communication between the interested parties and reduce the risk of miscommunication and the inefficiencies that may result. Management's Response and Corrective Action Plan Staff will coordinate with the TPA, Finance, FIR and the actuary to assure that the employee's enrollment and claims data that is reported to the actuary in the future is accurately reported according to the proper employee type such as active, COBRA, Retiree, and VSfP to assure greater accuracy in the calculation of OPEB. 1102 - 1231597 5 (III��IIIIIII�� '' JERNST &YOUNG Current year status: County and Clerk's staff coordinated with the actuary and the third party administrator (TPA) to update the OPEB calculations for fiscal year 2010. Staff also performed analytical review of the actuarial estimates, using actual data provided by the TPA, to assess the reasonableness of the net OPEB liability. 2009 -4 Conflict of Interest Policies Observation We became aware of a potential conflict of interest with respect to the HHS director who is also chairman of the board of a non -profit organization to whom HHS makes payments for services. We were informed that this individual, who is ultimately responsible for recommending funding and approving payments as the director of the department, also served as the authorizing party for the sub - recipient claim attestations on a payment request made to the County. Recommendation We recommend that the County review its conflict of interest policies and ensure it has an adequate process in place to either prevent or detect these types of potential conflicts. Additionally, when these types of conflicts are identified, we recommend the County document how it is addressed to ensure conflicts of interest do not actually occur. Management's Response and Corrective Action Plan Management concurs. Staff is conducting a review of existing CMA (County Manager Agency) procedure as directed by the Board of County Commissioners at their meeting on February 9, 2010. Current year status: Management revised and enforced CMA 5311 Code of Ethics and added the following paragraph: "Employees may not serve in a decision- making capacity for any entity that receives funding (either directly or indirectly) from the Board of County Commissioners, including grant funding. Prior to an entity making a request for funding from the Board of County Commissioners, any employee serving the agency in a decision- making capacity must resign from that position. The Board may, with good cause shown, waive this restriction upon a super majority vote." 1102 - 1231597 J ERNST & YOUNG C. OTHER REQUIRED COMMUNICATIONS The Rules of the Auditor General, Section 10.554 (I)(i)(I), require that we address in the management letter whether or not corrective actions have been taken to address significant findings and recommendations made in the preceding annual financial audit report. The status of recommendations made in the preceding annual financial audit is included above. In connection with our audit, we noted no instances of noncompliance with Section 218.415, Florida Statutes regarding the investment of public funds. The Rules of the Auditor General, Section 10.554(1)(i)(3), require that we address in a management letter any recommendations to improve Collier County, Florida's financial management, accounting procedures, and internal controls. Current year recommendations to improve Collier County, Florida's financial management, accounting procedures, or internal controls are included above. The Rules of the Auditor General, Section 10.554(I)(i)(4), require that we address in a management letter any violations of provisions of contracts and grant agreements or abuse that have an effect on the financial statements that is less than material but more than inconsequential. The results of our audit disclosed no violations of provisions or contracts and grant agreement or abuse that would have an effect on the financial statement that is less than material but more than inconsequential. The Rules of the Auditor General, Section 10.554(1)(i)(5), require disclosure in the management letter of the following matters, if not addressed in the auditor's report on internal control over financial reporting and on compliance and other matters or in the schedule of findings and questioned costs, and are not clearly inconsequential: (a) Violations of laws, rules, regulations, and contractual provisions or abuse that have occurred, or are likely to have occurred, would have an immaterial effect on the financial statements, and were discovered within the scope of the audit; (b) Control deficiencies that are not significant deficiencies, including, but not limited to: (1) Improper or inadequate accounting procedures (e.g., the omission of required disclosures from the annual financial statements); (2) Failures to properly record financial transactions; and (3) Other inaccuracies, shortages, defalcations, and instances of fraud discovered by, or that come to the attention of, the auditor. 1102- 1231597 7 II�II��IIIIIIII� " JERNST &YOUNG The results of our audit disclosed no violations of laws, rules, regulations, and contractual provisions or abuse, no improper or illegal expenditures, and no control deficiencies other than the internal control recommendations included above. The Ruler of the Auditor General, Section 10.554(1)(i)(6), also require that the name or official title and legal authority for the primary government and each component unit of the reporting entity be disclosed in the management letter, unless disclosed in the notes to the financial statements. In that regard, Collier County, Florida was established under Chapter 107, Section 1, Florida Statutes. The legal authority for Collier County and its component units are discussed in Note 1 to the financial statements. During the course of our audit of the County, nothing came to our attention that would cause us to believe that the County was in a state of financial emergency, as defined by Section 21 8.503(t), Florida Statutes. As required by the Rules of the Auditor General, Section 10.554(l)(i)(7)(b), the County filedits report pursuant to Section 218.32(1)(a), Florida Statutes. Based on our review of the financial information contained in this report, no material differences were found in comparing this information to that of the basic financial statements. As required by the Rules of the Auditor General, Sections 10.554(1)(i)(7)(c) and 10.556(7), we applied financial condition assessment procedures. It is management's responsibility to monitor the County's financial condition, and our financial condition assessment was based in part on representations made by management and the review of financial information provided by same. This report is intended solely for the information and use of the Board of County Commissioners, management and the Auditor General of the State of Florida, and is not intended to be and should not be used by anyone other than these specified parties. Ox:� -f t7 UP February 22, 2011 1102 - 1231597 8 ANNUAL DEBT REPORT (UNAUDITED) Pursuant to the Collier County Debt Policy the following Tables were prepared for the fiscal year ended September 30, 2010. Table 1. Calculation of Collier County General Governmental Debt Ratio Table 2. Calculation of Collier County Enterprise Debt Ratios THIS PAGE INTENTIONALLY LEFT BLANK TABLE 1 Calculation of Collier County General Governmental Debt Ratio For the Fiscal year Ended September 30, 2010 Bondable revenues, as defined by Collier County Debt Policy: Current Ad Valorem Taxes $ 286,364,739 Governmental Impact Fees 18,709,751 Half Cent Sales Tax 26,926,904 Developmental Fees 10,078,736 State Revenue Sharing 7,507,543 5th Cent Local Option Gas Tax 4,950,902 6th Cent Local Option Gas Tax 6,550,799 Constitutional Gas Tax 3,842,604 Seventh Cent Gas Tax 1,677,220 Ninth Cent Gas Tax 1,393,599 Parks and Recreation Fees 6,350,881 Tourist Development Tax 12,856,489 Court Facilities Fees 1,132,754 Communications Services Tax 5,545,415 Total bondable revenues $ 393,888,336 Fiscal 2010 governmental debt service requirements: Series 2002 Capital Improvement Bonds Principal: $ 2,435,000 Interest: 1,369,938 Series 2003 Capital Improvement Bonds Principal: 1,375,000 Interest: 1,626,256 Series 2005 Capital Improvement Bonds Principal: 5,640,000 Interest: 6,961,869 Series 2003 Gas Tax Bonds Principal: 6,440,000 Interest: 3,053,305 Series 2005 Gas Tax Bonds Principal: 495,000 Interest: 4,591,938 State Infrastructure Bank Loan Principal: 1,839,148 Interest: 200,852 Commercial Paper Program Principal: _ Interest: 454,171 Total fiscal 2010 governmental debt service requirements $ 36,482,477 Governmental debt ratio of fiscal year 2010 debt service requirements to total bondable revenues (13.0% maximum allowed by policy) 9.3% Notes: All revenues are GAAP based accrual and debt service is based upon current amortization tables for the fiscal year indicated. Debt prepayments are not included as debt service requirements. TABLE 2 Calculation of Collier County Enterprise Debt Ratios For the Fiscal Year Ended September 30, 2010 Collier County Water and Sewer District: Total Sales Revenue $ 97,404,893 Allowance for Funds Prudently Invested 965,500 Miscellaneous Revenue 2,289,082 Total Operating Revenue 100,659,475 Non - Operating Revenue 1,170,838 Gross Revenue 101,830,313 Less: Operation and Maintenance Expense (excluding Depreciation and Amortization) 50,893,435 Net Revenue Available for Debt Service (1) $ 50,936,878 Total Fiscal Year 2010 Debt Service on Bonds (2) $ 12,117,246 Net Revenue Debt Service Coverage on Bonded Debt (100% Required) - (1/2) 420% Other Pledged Funds: System Development Fees $ 7,259,306 Special Assessment Proceeds 569,441 Total Pledged Funds Available for Debt Service (3) $ 58,765,625 Total Fiscal Year 2010 Debt Service on Bonds (4) $ 12,117,246 Total Pledged Funds Debt Service Coverage on Bonded Debt (125% Required) - (3/4) 485% Total Pledged Funds Available for Debt Service After Payment of Bonds (5) $ 46,648,379 Total Fiscal Year 2010 Debt Service on Subordinated Indebtedness (6) $ 10,054,531 Calculated Coverage on Subordinated Indebtedness - (5/6) 464% Total Pledged Funds Available for System Purposes $ 36,593,848 Summary Debt Statement for Fiscal Year 2010 General Governmental Debt: The governmental debt ratio remained unchanged from September 30, 2009 at 9.3% for the fiscal year ended September 30, 2010. The governmental debt ratio is the ratio of debt service requirements to total bondable revenues, as defined by Collier County's Debt Policy. Total bondable revenues decreased by 2.0 %, primarily due to a 2.9% decrease in non -debt related current Ad Valorem Tax receipts. Offsetting this decrease was a 21.6% increase in developmental fees, compared to fiscal year 2009. Total governmental debt service requirements decreased by 2.5% from fiscal year 2009 to fiscal year 2010, due to the refinancing of the County's variable rate commercial paper loans in July of 2010, discussed below. Collier County's Debt Policy sets the maximum allowable governmental debt ratio at 13.0 %, and the County continues to operate below this self - imposed maximum. The Constitution of the State of Florida and the Florida Statutes set no legal debt limit. In July of 2010, Collier County refinanced all of its outstanding variable rate commercial paper loans with the Series 2010 Special Obligation Revenue Bonds. The Series 2010 bonds have a fixed interest rate and an all in true interest cost of 4.3 %. There were no other general governmental debt borrowings for fiscal year 2010. Fitch Ratings has currently assigned the following ratings to outstanding County debt, Capital Improvement Revenue bonds at AA -, Gas Tax Revenue bonds at AA- and Special Obligation Revenue bonds at AA. A rating of AA is an indication by Fitch of an investment grade instrument, but one which carries a slightly higher risk than a AAA rated bond. Fitch also uses intermediate +/- modifiers for each AA category. Moody's Investors Services assigned the following ratings to outstanding County debt, Capital Improvement Revenue bonds at Al, Gas Tax Revenue bonds at Al and Special Obligation Revenue bonds at Aa2. A rating of Aa2 is an indication by Moody's of a high quality investment grade instrument, but "their susceptibility to long -term risks appears somewhat greater" than a Aaa rated bond. A rating of Al is an indication by Moody's of an investment grade instrument with low credit risk but the bond has elements "present that suggest a susceptibility to impairment over the long term ". Moody's uses intermediate modifiers of 1 (higher) to 3 (lower) within the Aa and A ranges. Standard and Poor's assigned the following ratings to outstanding County debt, Capital Improvement Revenue bonds at AA- and Special Obligation Revenue bonds at AA. A rating of AA is an indication by Standard and Poor's of an investment grade instrument issued by a "quality borrower" but with slightly more risk than a AAA grade investment. Standard and Poor's also uses intermediate +/- modifiers for each AA category. Specific pledge coverage exceeded 100% in all governmental bond categories. The County's half cent sales tax revenues are pledged for the payment of all the outstanding Capital Improvement Revenue bonds. Fiscal year 2010 sales tax revenues covered the current year debt service payments on all outstanding Capital Improvement Revenue bonds at 139 %. The combined gas tax revenues are pledged for the payment of all the Gas Tax Revenue bonds. Fiscal year 2010 gas tax revenues covered the current year debt service payments on all outstanding Gas Tax Revenue bonds at 126 %. Collier County Enterprise Debt: Currently, the Collier County Water and Sewer District (District) is the only County enterprise activity with bonded debt outstanding. The Collier County Debt Policy does not set a maximum allowable enterprise debt ratio, but coverage requirements are set by bond covenants. Net revenues, defined as operating revenues plus non - operating revenues less operating expenses, excluding depreciation, must cover bonded debt service at 100 %. Total pledged funds, defined as net revenues plus system development fees and special assessments must cover bonded debt at 125 %. Net revenue coverage on bonded debt was 420% and total pledged funds coverage on bonded debt was 485% for fiscal year 2010. Net revenue available for debt service decreased during fiscal year 2010 by 10.9 %, mainly due to a 2.9% decrease in sales revenue coupled with a 2.3% increase in operating expenses, excluding depreciation. Operating expenses increased as the Water and Sewer District's focus has shifted from capital expansion to maintenance and optimization of existing facilities. Total pledged funds coverage on bonded debt decreased during fiscal year 2010 mainly due to the decrease in net revenue available for debt service discussed above. Bonded debt service payments decreased by 1.2% when compared to fiscal year 2009. The District's calculated coverage on subordinated debt, all in the form of State Revolving Fund Loans, is 464 %. The total pledged funds coverage required by the loan agreements varies between 115% and 125 %, depending upon the individual loan agreement. In October of 2009 the Collier County Water and Sewer District issued the $11,727,489 Collier County Water -Sewer District Water and Sewer Refunding Revenue Bond, Series 2009 for purposes of currently refunding all of the outstanding Collier County Water and Sewer District's Series 1999B bonds. The bonds were issued on parity with existing County Water and Sewer debt and pay a fixed rate of interest of 2.97% through their maturity on July 1, 2016. The current refunding achieved a net present value savings of 5.32% on the refunded bonds Fitch Ratings has currently assigned a rating of AA+ to the District's Water and Sewer Revenue bonds. A rating of AA is an indication by Fitch of an investment grade instrument, but one which carries a slightly higher risk than a AAA rated bond. Fitch also uses intermediate +/- modifiers for each AA category. Moody's Investors Services has currently assigned a rating of Aa2 to the District's Water and Sewer Revenue bonds. A rating of Aa2 is an indication by Moody's of a high quality investment grade instrument, but "their susceptibility to long -term risks appears somewhat greater" than a Aaa rated bond. Moody's uses intermediate modifiers of I (higher) to 3 (lower) within the Aa and A ranges. The District maintains a single renewal and replacement reserve for water and sewer, for its capital spending program. The District's continued strategy of revenue - centric, cost - contained, real -time capital program management, and its decisions against measured operational risk, were deliberately designed to manage deferral of capital construction. This, together with the "pay as you go" approach, maintains the District's financial sustainability. The District has also chosen to avoid pre- approved State Revolving Fund loan drawdowns to preserve the "pay as you go" approach, thus avoiding additional outstanding debt. Since FY07, the District, operating in a volatile and uncertain cost and revenue market environment, deferred with measured operational risk significant levels of spending in capital improvement projects. The deferral of significant capital rehabilitation projects since FY07, maintains the District's liquidity and financial flexibility. These decisions protect the District's favorable bond rating; avoids the potential of future user -fee rate spikes, and avoids unplanned and costly borrowing with the associated increases in annual debt service. It also puts the District in the position to sustain financial stability in the face of the uncertainties in the local economy for the next two or three years, and allows for the appropriate response to economic recovery. However, this deferral of capital spending has elevated the risk level of everyday operations within the utility. Through aggressive and proactive operational management, this risk level is currently acceptable in the balance of the overall mission to stay in operational and regulatory compliance, meet customer demand, and posture for a best -value future. These deferrals, however, cannot be considered avoided cost as the deferred projects will need to be completed within the next two to three years. THIS PAGE INTENTIONALLY LEFT BLANK SPECIAL- PURPOSE FINANCIAL STATEMENTS Collier County, Florida Clerk of the Circuit Court Year Ended September 30, 2010 With Report of Independent Certified Public Accountants r , I R /' ,I I l l ' J ERNST & YOUNG Collier County, Florida Clerk of the Circuit Court Special - Purpose Financial Statements Year Ended September 30, 2010 Contents Report of Independent Certified Public Accountants Special - purpose Financial Statements Special- Purpose Balance Sheet - Governmental Funds .... ............................... Special - Purpose Statement of Revenues, Expenditures, and Changes in Fund Balances - Governmental Funds .................................... ............................... .....3 Special - Purpose Statement of Revenues, Expenditures, and Changes in Fund Balance - Budget and Actual - General Fund ................................................ ..............................5 Special - Purpose Statement of Revenues, Expenditures, and Changes in Fund Balance - Budget and Actual - Court Services Fund (Budgetary Basis) ....... ..............................6 Special - Purpose Statement of Revenues, Expenditures, and Changes in Fund Balance - Budget and Actual - Public Records Modernization Fund ............ ..............................7 Special - Purpose Statement of Revenues, Expenditures, and Changes in Fund Balance- Budget and Actual - Juvenile Assessment Fund ........................... ..............................8 Special- Purpose Balance Sheet - Agency Funds ............................................... ..............................9 Notes to Financial Statements ........................................................................... .............................10 Combining Information Combining Balance Sheet -- Agency Funds ...................................................... .............................23 Statement of Changes in Assets and Liabilities - Agency Funds ......... - .......... .............................24 Report of Independent Certified Public Accountants on Internal Control Over Financing Reporting and on Compliance and Other Matters Based on an Audit of Special - Purpose Financial Statements Performed in Accordance With Government AuditingStandards .................................... ............................................................................... ManagementLetter ....................................................................-..................... .............................27 1101- 1219838 JERNST &YOUNG Ern st & Young LLP . oo Report of Independent Certified Public Accountants Honorable Dwight E. Brock, Clerk of the Circuit Court Collier County, Florida We have audited the accompanying special- purpose financial statements of each major fund and the aggregate remaining fund information of the Collier County, Florida Clerk of the Circuit Court (the Clerk of the Circuit Court), as of and for the year ended September 30, 2010, as listed in the table of contents. These special - purpose financial statements are the responsibility of the Clerk of the Circuit Court's management. Our responsibility is to express opinions on these special - purpose financial statements based on our audit. The prior year summarized comparative financial information has been derived from the Clerk's special - purpose financial statements for the year ended September 30, 2009, and in our report dated December 17, 2009, we expressed unqualified opinions on the respective financial statements of each major fund and the aggregate remaining fund information. We conducted our audit in accordance with auditing standards generally accepted in the United States and the standards applicable to financial audits contained in Government Auditing Standards, issued by the Comptroller General of the United States. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the special - purpose financial statements are free of material misstatement. We were not engaged to perform an audit of the Clerk of the Circuit Court's internal control over financial reporting. Our audit included consideration of internal control over financial reporting as a basis for designing audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the Clerk of the Circuit Court's internal control over financial reporting. Accordingly, we express no such opinion. An audit also includes examining, on a test basis, evidence supporting the amounts and disclosures in the special - purpose financial statements, assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall special - purpose financial statement presentation. We believe that our audit provides a reasonable basis for our opinions. As discussed in Note 1, the accompanying special- purpose financial statements referred to above were prepared for the purpose of complying with Section 218.39, Florida Statutes, and Chapter 10.557(3), Rules of the Auditor General for Local Governmental Entity Audits. These special- purpose financial statements are not intended to be a complete presentation of the Clerk of the Circuit Court's financial position and its changes in financial position, where applicable, therefore, for the years then ended, in conformity with accounting principles generally accepted in the United States. Additionally, the special - purpose statements present only the Clerk of the Circuit Court and do not purport to, and do not, present fairly the financial position of Collier 110 1 - 12 19838 I JERNST &YOUNG County, Florida, as of September 30, 2010, and the changes in its financial position, where applicable, for the year then ended, in conformity with accounting principles generally accepted in the United States. In our opinion, the special - purpose financial statements referred to above present fairly, in all material respects, the respective financial position of each major fund and the aggregate remaining fund information of the Clerk of the Circuit Court as of September 30, 2010, and the respective changes in financial position thereof, and the budgetary comparison for the general fund, the court services fund, the public records modernization fund, and thejuvenile assessment fund for the year then ended, in conformity with accounting principles generally accepted in the United States. In accordance with Government Auditing Standards, we have also issued our report dated January 10, 2011 on our consideration of the Clerk of the Circuit Court's internal control over financial reporting and on our tests of its compliance with certain provisions of laws, regulations, contracts, and grant agreements and other matters. The purpose of that report is to describe the scope of our testing of internal control over financial reporting and compliance and the results of that testing and not to provide an opinion on the internal control over financial reporting or on compliance. That report is an integral part of an audit performed in accordance with Government Auditing Standards and should be considered in assessing the results of our audit. This report is intended solely for the information and use of the Clerk of the Circuit Court, management, the Board of County Commissioners of Collier County, Florida, and the Auditor General of the State of Florida, and is not intended to be and should not be used by anyone other than these specified parties. ('.taws f ow7UP January 10, 2011 1101 - 1219838 'b o U U x o � b it W N N U M� W N V1 O a U N 0 0 N o `^ W O v! O OM N � F H N � o U e9 R C E V p I d 7 ' � L a � � Paz f V I 1p f� M Q C'1 iD h l0 S9 M 09 O 1 O T N Or! 06 I O N x z r ^ JG C 11 V N n QA J n x ti 7 O� M M1 O > C 00 T T bri V M 00 O� r -IM � I III S9 I K M M. O a Z9 I f, 9 M a o 3 J � S m f, 9 M , \ G \ .e { j j) ~w / \ \E z[ \\ \\ ){ (/ \\ 2 % ) \ { _ ƒ Collier County, Florida Clerk of the Circuit Court Special Purpose Statement of Revenues, Expenditures, and Changes in Fund Balance — Budget and Actual — General Fund Year Ended September 30, 2010 Variance With Final Budget Budget Punitive Original Final Actual (Nega6ve) Revenues: rrmislers io Collier( odaty, Flouda Board of('ounty Charge; for sc, ices $ 1959.200 $ 1.959.200 S 2,388059 S 429,159 Interest income 175,800 175.800 29,713 (146.087) 1 oral revenues 2,135.000 2.135.000 2,418,072 283,072 Expenditures: rrmislers io Collier( odaty, Flouda Board of('ounty General government: Commissioners appropriations 527 3500 5,273,500 5,273,50(1 - r.nslers ou( personal servic. 4,972,050 5.454.7S(1 4,814,113 640,637 Operating expenditures 2348,550 1765.8511 1,308,020 457.830 ('apical outlay 82900 187,900 175,896 12.004 rotal expenditures 7408,500 7.408,500 6,298,029 1,110,471 Execs,(deficicncy) of revenues ovcr(undcr) expenditures (5.273,500) (5.2 73,500) (3,879,957) 1393543 Other financing sources (uses): rrmislers io Collier( odaty, Flouda Board of('ounty Commissioners appropriations 527 3500 5,273,500 5,273,50(1 - r.nslers ou( Collier( turrity, Florida Board or ('ounty Conunisstoners: Disnibutioa ofcxcess appropmions (1 }93,543) (1391543) l oral other financing sources (uses) 5,273.500 5.273.500 3,879,957 (1393,543) Excess of revenues mud other r aoc a sources over expenditures Fundbalance beginningofycar Fund balance cod of See nccnmpan,mg notcr. 1101 - 1219838 Collier County, Florida Clerk of the Circuit Court Special Purpose Statement of Revenues, Expenditures, and Changes in Fund Balance — Budget and Actual — Court Services Fund (Budgetary Basis) Revenues I ntergovemmentaI Total revenues Expenditures: General govennnenL Persalal services ($crating expenditures Total expenditures Excess ofrevenues over expenditures Other financing sources (uses) I ransfers out Distribution ofexcess court revenuelo the State Total other financing sources (uses) Excess ofrevenues and other financing sources over expenditures Fund balance beginning ofyear Fund balance end ofyear See ,,."'p"q....g "ales. Year Ended September 30, 2010 Varianm With Final Budget Budget Positive Original Final Actual (Negative) S 6,499.156 $ 8,878.476 $ 9.088,482 $ 209,926 6,499.156 8,878.476 9.088,482 209,926 5,972.125 7.353.684 7,190,549 163,115 527.031 418.135 368,932 69103 6,499.156 7- 791,819 7,559,481 232,338 1,086,657 1,528,921 442,264 (1.086,657) (1,086,657) ( 1.086.657) (1,086,657) 442,217 442,264 188,610 188,610 630.874 S 630,874 1101-12 1983 8 6 Collier County, Florida Clerk of the Circuit Court Special Purpose Statement of Revenues, Expenditures, and Changes in Fund Balance Budget and Actual — Public Records Modernization Fund Year Ended September 30, 2010 Iixpeeditures: Variance General govenmt end e With Fund Personal services 1,119300 1,119300 1,104,914 Budget ($crating expenditures Budget 794.000 528,826 Positive ('aPit.l outlay Original Final Actual (Negative) Revenues_ 3200.400 3,200,400 1,677220 1,523.180 Charges f r services $ 675,000 5 675.000 5 1,125327 8 450,327 Interest incmnc 60,000 60.000 10,590 (49,410) Total revenue, 735.000 735.000 1,135,917 400,917 Iixpeeditures: General govenmt end e Personal services 1,119300 1,119300 1,104,914 14.186 ($crating expenditures 794.0011 794.000 528,826 265,174 ('aPit.l outlay 1287.1110 1287,100 43,480 1.243.620 Total expenditures 3200.400 3,200,400 1,677220 1,523.180 Excess (deficiency) of revenues over (wider) expenditure, (1465.400) (2?65,400) (541303) 1,924.097 Other financing sources (uses)- Transfers in hum the collier county, Florida Huard of county ('ounnissloncrs l'runsters out to oilier limds Total other financing sources (uses) Pxcess of revenues and other financing sources (uses) civet (wider) expenditures Fund balance beginning fyear Fund balance cndofycar See nerompmn"ic note'. 1101 - 1219838 (2,466.400) (2,465400) (5413113) L924M97 3.6'_1.500 4.253.663 4,290,475 36,812 S 1,156,100 S 1,788.263 1 3,749,172 S 1,960,909 Collier County, Florida Clerk of the Circuit Court Special Purpose Statement of Revenues, Expenditures, and Changes in Fund Balance — Budget and Actual — Juvenile Assessment Fund Year Ended September 30, 2010 Variance With Vnal Budget Budget Positive Original Final Actual (Negadve) Revenues_ Miscellaneous Interest income I tat revenues Expenditures: General government. Operaling Total expenditures I xcess(dcftcieucy)ofcxpcndimres over (under) revenues Other financing uses: l'ur"fers out to$hcri(f (17.465) (17,465) Dotal odter financing sources (17.465) (17,465) Fxeess (deficiency) of%vevmes and other linancing sources ovcr(Under) cxpcndaures and other uses (17.465) (17,465) Fund balance beginning ufyear 17.465 17,465 Fund balance endofyear $ $ g — $ se" "u, log notes_ 1101 - 1219838 8 Collier County, Florida Clerk of the Circuit Court Balance Sheet — Agency Funds Assets Cash and cash equivalents Total assets Liabilities Due to the Collier County, Florida Board of County Commissioners Due to other governments Deposits Total liabilities See accompanying notes. September 30 2010 2009 $ 21,474,385 $ 18,806,440 $ 21,474,385 $ 18,806,440 $ 408,708 $ 339,184 1,062,928 1,208,478 20,002,749 17,258,778 $ 21,474,385 $ 18,806,440 1101- 1219838 9 Collier County, Florida Clerk of the Circuit Court Notes to Special- purpose Financial Statements Year Ended September 30, 2010 1. Summary of Significant Accounting Policies Reporting Entity The Collier County, Florida Clerk of the Circuit Court (the Clerk) is an elected constitutional officer as provided for by the Constitution of the State of Florida. The Clerk's budget is presented pursuant to Chapter 218, Florida Statutes. Additionally, a budget is submitted to the Florida Clerks of Court Operations Corporation for the court services fund. The Clerk's budget including the public records modernization fund and the juvenile assessment center fund is approved by the Clerk. The special - purpose financial statements presented include the general fund, special revenue funds, and agency funds of the Clerk's office. The accompanying special - purpose financial statements were prepared for the purpose of complying with Section 218.39, Florida Statutes, and Section 10.557(3 ), Rules of the Auditor General for Local Governmental Entity Audits. Section 10.556(4), Rules of the Auditor General for Local Governmental Entity Audits, requires the Clerk to only present fund financial statements. Accordingly, due to the omission of government -wide financial statements and related disclosures including a management's discussion and analysis, these special - purpose financial statements do not constitute a complete presentation of the financial position of the Clerk as of September 30, 2010 and the changes in its financial position for the year then ended in conformity with Governmental Accounting Standards Board (GASB) Statement No. 34, Basic Financial Statements — and Management's Discussion and Analysis — for State and Local Governments, but otherwise constitute special - purpose financial statements prepared in conformity with accounting principles generally accepted in the United States. The financial activities of the Clerk, as a constitutional officer, are included in the Collier County, Florida Comprehensive Annual Financial Report. The general operations of the Clerk are funded by lees from third parties, appropriations from the Collier County, Florida Board of County Commissioners (Board), appropriations from the State of Florida (since July I, 2009) and interest income. Pursuant to Section 218.32(2) Florida Statutes, funds remaining in the general fund, at fiscal year end in excess of amounts expended, are returned to the Board. Excess revenues returned to the Board are reflected as transfers out in the Clerk's general fund. Court- related operations are funded by the State via appropriations from the State of Florida (since July I, 2009) and a small child support grant; any surplus is returned to the State. 1101- 1219838 Collier County, Florida Clerk of the Circuit Court Notes to Special- purpose Financial Statements Year Ended September 30, 2010 1. Summary of Significant Accounting Policies (continued) Measurement Focus, Basis of Accounting, and Basis of Presentation These special- purpose fund financial statements report detailed information about the Clerk. The focus of governmental fund financial statements is on major funds rather than reporting funds by type. Each major fund is reported in a separate column. Governmental Funds Governmental funds are accounted for using the flow of current financial resources measurement focus. Only current assets and current liabilities, generally, are included on the special- purpose balance sheet. Operating statements for these funds present increases (i.e., revenues and other financing sources) and decreases (i.e., expenditures and other financing uses) in net current assets. The Clerk reports the following major governmental funds: General Fund The general fund is used to account for all revenue and expenditures applicable to the general operations of the Clerk, which are not accounted for in another fund. All operating revenue not specifically restricted or designated as to use, is recorded in the general fund. Court Services Fund — This fund was established to account for court- related filing fees, service charges, fines, court costs, appropriations and expenses of the Clerk as mandated by Section 28.35, Florida Statutes. Public Records Modernization Fund — This fund is mandated by Section 28.24(12)(d), Florida Statutes, to be held in trust by the Clerk and used exclusively for equipment and maintenance of equipment, personnel training, and technical assistance in modernizing the public records system of the office. Effective July 1, 2004, an additional amount is collected pursuant to Section 28.24 (12) (e), Florida Statutes, and used exclusively for funding court- related technology needs. Juvenile Assessment Fund — This fund was established to account for revenues and expenditures applicable to juvenile assessments center. This fund was closed during the fiscal year and the remaining balance transferred to the Sheriffs office. 1101 - 1219878 11 Collier County, Florida Clerk of the Circuit Court Notes to Special - purpose Financial Statements Year Ended September 30, 2010 1. Summary of Significant Accounting Policies (continued) With the implementation of Revision 7 to Article V on July 1, 2004, the Clerk's activities are classified as court- related and non - court- related. The Clerk's general fund activity, which is classified as non -court- related, is funded through service charges for recording instruments and documents into the official records, interest income and through transfers in from the Board. Court- related activities were funded by the fees charged by the Clerk as authorized by Florida Statutes, for maintaining the County and Circuit Court records, and collecting the fines and fees assessed by the courts through June 30, 2009. As of July 1, 2009 the Clerk is funded through an appropriation from the State of Florida and a small child support grant. These court fees and appropriations are to be used exclusively for funding court- related operations of the Clerk. The excess of revenues collected over expenditures is returned to the Florida Clerks of Court Operations Corporation. The modified accrual basis of accounting is used by governmental funds. Under the modified accrual basis of accounting, revenues are recognized when susceptible to accrual (i.e., when they become measurable and available to finance current liabilities o£ the fiscal year). For this purpose, the Clerk considers revenues to be available if they are collected within 60 days after year -end. Expenditures are recorded when the related fund liability is incurred, except for certain compensated absences, which are recognized as expenditures to the extent they have matured. Charges for services, interest income, and other revenues are recognized as they are earned and become measurable and available to pay liabilities of the current period. Florida Statutes provide that the amount by which revenues and transfers exceed annual expenditures for the general fund be remitted to the Board immediately following the fiscal year for which the funding was provided or following the fiscal year during which other revenues were recognized. The amount of this distribution is recorded as a liability and as other financing use in the accompanying special - purpose financial statements. Section 28.37, Florida Statutes, provides that all court related revenues are considered State revenue effective July 1, 2009 and are to be remitted monthly to the Department of Revenue. Prior to this law change the Clerk remitted to the Department of Revenue the cumulative excess of all fees, service charges, court costs, and fines retained by the Clerk over the amount needed to meet the approved budget amounts established by Section 28.36, Florida Statutes for the period from October 1, 2008 through June 30, 2009. 1101 - 1219838 12 Collier County, Florida Clerk of the Circuit Court Notes to Special - purpose Financial Statements Year Ended September 30, 2010 L Summary of Significant Accounting Policies (continued) Capital outlays expended in governmental funds are capitalized in the basic financial statements of Collier County, Florida rather than in the governmental funds of the Clerk. Additionally, the Clerk reports the following fund type: Fiduciary Funds — Agenev Funds These funds are used to account for assets held by the Clerk in a trustee capacity or as an agent for individuals, private organizations, other governments, and other funds. The agency funds are custodial in nature (assets equal liabilities), and do not involve measurement of results of operations or have a measurement focus. Agency funds are accounted for using the modified accrual basis of accounting. Cash Equivalents Cash equivalents are defined as highly liquid investments with original maturities of three months or less. The Clerk does not currently hold investments. Compensated Absences Full -time employees of the Clerk are allowed to accumulate an unlimited number of hours of unused sick leave and up to 240 hours of unused vacation leave. Upon termination, employees receive 100% of allowable accumulated vacation hours and a percentage of unused sick leave, depending on years of service. Vacation leave and sick leave are included in operating costs when the payments are made to employees. The Clerk is not legally required to accumulate financial resources for these unmatured obligations. Accordingly, the liability for compensated absences is not reported in the general fund, but rather is reported in the basic financial statements of Collier County, Florida. Prepaid Expenses The Clerk has elected to follow GASB Codification 1600.127 Other Expenditure Recognition Alternatives and expends maintenance costs as they are incurred and does not allocate the cost between periods. 1101- 1219838 13 Collier County, Florida Clerk of the Circuit Court Notes to Special - purpose Financial Statements Year Ended September 30, 2010 1. Summary of Significant Accounting Policies (continued) Use of Estimates The preparation of these special- purpose financial statements requires management of the Clerk to make a number of estimates and assumptions relating to the reported amounts of assets and liabilities and the disclosure of contingent assets and liabilities at the date of the special - purpose financial statements and the reported amounts of revenues and expenditures during that period. Actual results could differ from those estimates. Comparative Data The special - purpose financial statements include certain prior year summarized comparative information in total but not at the level of detail required for a complete presentation in conformity with generally accepted accounting principles. Accordingly, such information should be read in conjunction with the Clerk's special - purpose financial statements for the year ended September 30, 2009, from which the summarized information was derived. 2. Budgetary Process Florida Statutes govern the preparation, adoption, and administration of the Clerk's annual budget. The Clerk prepares and approves the budget for the Clerk's non -court functions, including public records modernization fund and the budget related to the recording function based on anticipated fees. The budget of the Clerk for the general fund transfer from the Board and juvenile assessment funds, is submitted to and approved by the Board. Pursuant to Section 28.36, Florida Statutes, a balanced court- related budget must be prepared on or before October I (for the period starting the next July 1 through June 30) and submitted to the Florida Clerks of Court Operations Corporation (the Corporation). If the Clerk estimates that projected revenues are insufficient to meet anticipated expenditures, the Clerk must report the revenue deficit to the Corporation. Once the Corporation verities the revenue deficit, the Clerk can increase fees up to the maximum amounts specified by law to resolve the deficit. If a revenue deficit is still projected, a request can be submitted to release funds from the Department of Revenue Clerks of the Court Trust Fund. Effective July I, 2009, all revenues in the court fund are now State revenues and remitted monthly to the State. The court functions are funded through a State appropriation based on the budget submittal to the Corporation. 1101- 1219838 14 Collier County, Florida Clerk of the Circuit Court Notes to Special - purpose Financial Statements Year Ended September 30, 2010 2. Budgetary Process (continued) The budget is prepared on a basis consistent with accounting principles generally accepted in the United States, except for the classification and presentation of the distribution of excess court revenue to the State for the Court Services Fund, which is treated as an other financing use (transfer out) lbr budgetary purposes and as an expenditure in the special- purpose statement of revenues, expenditures, and changes in fund balance in the court services fund. The annual budget serves as the legal authorization for expenditures. Any subsequent amendments to the Clerk's transfer budget funded by the Board must be approved by the Board, amendments to the Clerk's fee budget are at the discretion of the Clerk, and any amendments of the court budget must be approved by the Corporation for the court services fund. Expenditures may not legally exceed appropriations at the fund level. Appropriations lapse at year end. Budgetary control is maintained at the departmental major object expenditure level. Budgetary changes within major object expenditure categories are made at the discretion of the Clerk. The original budget is the first complete appropriated budget. The final budget is the original budget adjusted by all reserves, transfers, allocations, supplemental appropriations, and other legally authorized changes applicable to the fiscal year, whenever legally authorized. 3. Cash and Cash Equivalents At September 30, 2010, the carrying value of the Clerk's cash and cash equivalents was as follows: Carrying Type Maturity Value Credit Rating Cash on hand Demand deposits Total cash and cash equivalents N/A $ 7,600 N/A N/A 29,588,858 N/A $ 29,596,458 The Clerk maintains a cash pool for the deposits of all governmental and agency funds. Each fund type's portion of these balances is presented as cash and cash equivalents in the accompanying special - purpose financial statements. Interest income is allocated to each fund based on its proportionate balance in the pool. Cash and cash equivalents as of September 30, 2010 are reported as $8,122,073 and $21,474,385 in the governmental funds and Fiduciary funds, respectively. 1101 - 1219838 15 Collier County, Florida Clerk of the Circuit Court Notes to Special - purpose Financial Statements Year Ended September 30, 2010 3. Cash and Cash Equivalents (continued) Custodial Credit Risk At September 30, 2010, the Clerk's deposits were entirely covered by federal depository insurance or by collateral pledged with the State Treasurer pursuant to Chapter 280, Florida Statutes. Under this Chapter, in the event of default by a participating financial institution (a qualified public depository), all participating institutions are obligated to reimburse the governmental entity for the loss. Credit Risk The Clerk's policy is to follow the guidance in Section 219.075, Florida Statutes, regarding the deposit of funds received and the investment of surplus funds. Sections 219.075 and 218.415, Florida Statutes, authorize the Clerk to invest in Florida Prime (formerly the Local Government Surplus Funds Trust Fund) or any intergovernmental investment pool authorized pursuant to the Florida Inter -local Cooperation Act; Securities and Exchange Commission registered money market funds with the highest credit quality rating from a nationally recognized rating agency; direct obligations of the United States Treasury, federal agencies and instrumentalities, or interest - bearing time deposits or savings accounts in banks organized under the laws of the United States and doing business and situated in the State of Florida, savings and loan associations which are under state supervision, or in federal savings and loan associations located in the State of Florida and organized under federal law and federal supervision, provided that any such deposits are secured by collateral as may be prescribed by law. Additionally, Florida Statutes allow local governments to place public funds with institutions that participate in a collateral pool under the Florida Security for Public Deposits Act. The pool is administered by the State Treasurer, who may make additional assessments to ensure that no public funds will be lost. Interest Rate Risk The Clerk has no specific investment policy regarding interest rate risk and does not currently hold any investments. 110 1 - 12 19838 16 Collier County, Florida Clerk of the Circuit Court Notes to Special - purpose Financial Statements Year Ended September 30, 2010 4. Interest Income and Investment of County Funds Pursuant to Florida Statutes, Section 28.33, the Clerk invests all County funds in excess of those required to meet expenses. Through June 30, 2009 interest revenue from funds invested was recorded as income of the office of the Clerk and any excess interest earnings are returned to the Board at year -end as described in Note 1. Effective July 1, 2009 Florida Statutes, Section 28.33 was amended and interest income became revenue to the Board of County Commissioners. Interest income is allocated to each fund based on its proportionate balance in the pool. Interest income of $29,713 is reported in the general fund for the year ended September 30, 2010 as the portion of interest earned on Clerk funds. 5. Receivables Pursuant to Florida Statutes, Section 28.246, the Clerk shall establish and maintain a system of accounts receivable for court- related fees, charges, and costs. Since July 1, 2004 the accumulated receivables through September 30, 2009 totaled $30,245,177. For the current period October 1, 2009 through September 30, 2010 accumulated additional receivables totaled $7,348,507 for a total cumulative receivable balance of $37,593,684. These funds represent a combination of monies due to the Clerk and the State with the majority due to the State. This receivable is considered uncollectible and is not recorded in the accompanying special - purpose financial statements. This outstanding balance will be monitored and all efforts will be made to collect these and any future balances outstanding due the Clerk. The Clerk currently contracts with two collection agencies in an effort to reduce this outstanding amount. 6. Capital Assets Capital assets used by the governmental fund type operations are capitalized in the basic financial statements of Collier County, Florida rather than in the governmental funds of the Clerk. Upon acquisition, such assets are recorded as expenditures in the governmental funds of the Clerk and capitalized at cost in the basic financial statements of Collier County, Florida. Capital assets are valued at historical cost, or estimated historical cost if actual historical cost is not available. Donated capital assets are valued at their estimated fair value on the date received. The Clerk maintains custodial responsibility for the capital assets used by the office. No depreciation has been provided on capital assets in the accompanying special - purpose financial statements. However, depreciation expense on these assets is recorded in the basic financial statements of Collier County, Florida. 1101 - 1219838 17 Collier County, Florida Clerk of the Circuit Court Notes to Special - purpose Financial Statements Year Ended September 30, 2010 7. Long -Term Liabilities The following is a summary of changes in general long -temi liabilities which are reflected in the basic financial statements of Collier County, Florida: October September 1, 2009 Additions Deletions 30, 2010 Accrued compensated absences $ 1,678,323 $ 719,058 $ 700,998 $ 1,696,383 Of these obligations, approximately $708,579 is expected to be paid during the fiscal year ending September 30, 2011. These long -term liabilities are not reported in the special- purpose financial statements of the Clerk since they have not matured. 8. Employee Retirement Plan Substantially all full -time employees of the Clerk are eligible to participate in the State of Florida Retirement System (System), a cost - sharing multiple - employer defined benefit plan administered by the State of Florida, Division of Retirement. The System is a defined benefit plan for all state and participating county, district board, community college, and university employees (Pension Plan). The System also offers eligible employees participation in an alternative defined contribution plan (Investment Plan). The Clerk participates in the Elected State Officers' Class. The plan is administered by the State of Florida. Contribution rates are established statewide for all participating governmental units. Accordingly, the actuarial information and related disclosures attributable to the Clerk's employees are not determinable. Employees participating in the Pension Plan, who retire at or after age 62 with six years of credited service or with 30 years of service regardless of age, are entitled to a retirement benefit payable monthly for life, equal to 1.6% for regular employees, 2% for senior management and 3% for county elected officials of their average final compensation for each year of credited service. Average final compensation is the employee's average of the five highest fiscal years of salary earned during credited service. Vested employees may retire before age 62 and receive benefits that are reduced 5% for each year prior to normal retirement age or date. Employees participating in the Pension Plan are vested after one year of service with no age requirements. The System also provides death and disability benefits. Benefits are established by Chapter 121, Florida Statutes. 1101- 1219838 18 Collier County, Florida Clerk of the Circuit Court Notes to Special - purpose Financial Statements Year Ended September 30, 2010 8. Employee Retirement Plan (continued) The Deferred Retirement Option Program (DROP) is a program that provides an alternative method for payment of retirement benefits for a specified and limited period for members of the System, effective July 1, 1998. Under this program, the employee may retire and have their benefits accumulate in the Florida Retirement System Trust Fund, earning interest, while continuing to work for a system employer. The participation in the program does not change conditions of employment. When the DROP period ends, a maximum of 60 months, employment must be terminated. At the time of termination of employment, the employee will receive payment of the accumulated DROP benefits, and begin receiving their monthly retirement benefit (in the same amount determined at retirement, plus annual cost -of- living increases). The System publishes an annual report that provides ten -year historical trend information about progress made in accumulating sufficient assets to pay benefits when due. This report may be obtained by writing to Division of Retirement, Department of Management Services, 1317 Winewood Boulevard, Building 8, Tallahassee, Florida 32399, or by calling (850) 488 -5706, or accessing their Internet site at www.firs.state.fl.us. The Clerk is required to contribute an actuarially determined rate. The current rate is 18.64% for county elected officials, 10.77% for regular employees, 14.57% for senior management, and 12.25% for DROP employees. The contribution requirements of the Clerk are established and may be amended by the State of Florida. The Clerk's contributions to the plan for the years September 30, 2010, 2009, and 2008 were $925,351, $1,127,280, and $1,213,623, respectively, equal to the required contributions for each year. 9. Related Party Transactions The Board provided funding for the Clerk in the amount of $5,273,500. The Supervisor of Elections provided funding in the amount of a $37,000 fee for financial services performed by the Clerk. At September 30, 2010, the Clerk had a payable due to the Board of $1,804,324 comprised as follows: Distribution of excess fees Agency funds due Total due to Board of County Commissioners $ 1,395,616 408,708 $ 1,804,324 1101 - 1219838 19 Collier County, Florida Clerk of the Circuit Court Notes to Special - purpose Financial Statements Year Ended September 30, 2010 9. Related Party Transactions At September 30, 2010 the Board had a payable due to the Clerk of $26,280 comprised as follows: Amounts due from various services $ 26,280 Total due from Board of County Commissioners $ 26,280 10. Risk Management Collier County, Florida (the County) is exposed to various risks of loss, including, but not limited to general liability, health and life, property and casualty, auto and physical damage, and workers' compensation. The County is substantially self - insured and accounts for and finances its risk of uninsured losses through an internal service fund. All liabilities associated with these self- insured risks are reported in the basic financial statements of the County. During the year ended September 30, 2009, the Clerk was charged $2,243,646 by the County for participation in the risk management program. The County retains the first $500,000 per claim for workers' compensation, and has purchased outside excess coverage for up to $25 million for employment liability claims and statutory limits for each injury and illness. The County also provides coverage for $100,000 per person /$200,000 per occurrence for general liability and auto liability coverage and has purchased outside excess coverage for up to $2 million per claim. Negligence claims in excess of the statutory limits set in Section 768.28, Florida Statutes, which provide for limited sovereign immunity of $100,000/$200,000 per occurrence can only be recovered through an act of the State Legislature. Property claims are subject to a 5% wind deductible and a $50,000 deductible for all other perils. The County retains the first $100,000 per claim /$200,000 per occurrence for public official errors and omissions and crime coverage and has purchased outside excess coverage for up to $5 million per claim. There have been no significant reductions in insurance coverage in the last year. Settled claims have not exceeded the insurance provided by third party carriers in any of the last three years. The County is self - insured for health claims covering all of its employees and their eligible dependents. The County retains the first $225,000 per covered member and has purchased outside excess coverage for up to $2 million for each claimant. An actuarial valuation is performed each year to estimate the amounts needed to pay prior and future claims and to establish reserves. 1101 - 1219838 20 Collier County, Florida Clerk of the Circuit Court Notes to Special - purpose Financial Statements Year Ended September 30, 2010 11. Other Postemployment Healthcare Benefits (OPEB) Plan During the year ended September 30, 2008, the County adopted GASB Statement 45, Accounting and Financial Reporting by Emplgvers Jbr Postemployment Benefits other than Pensions. Plan Description. The Clerk of the Circuit Court participates in a group health care plan that covers eligible retirees, and their dependents, of the Board of County Commissioners and all Constitutional Officers with the exception of the Sheriff. The Board administers the plan and establishes the benefits. The healthcare plan does not issue a stand -alone financial report, however additional actuarial information regarding the plan as a whole is disclosed in the notes to the financial statements of Collier County. As required by Section 112.081, Florida Statutes, retirees, and their eligible dependents are provided the same health care coverage as is offered to active employees at the same premium cost (borne by the retiree) applicable to active employees. Under Florida Statutes, retirees are eligible to participate in the active medical plan by paying the active rate if they have attained age 62 and have 6 years of service or have at least 30 years of service. Employees eligible for a reduced benefit under the Florida Retirement System prior to age 62 are also eligible to participate in the medical plan. The Clerk provides no subsidy to the retiree, or their dependents, for group health care. Funding Policy. The contribution requirements of the plan members and the employers are established and may be amended by the County. The plans are financed by the participating agencies on a pay as you go basis through the County's self insurance internal service fund. The Clerk contributes an additional amount to the County per each active employee to accumulate resources to fund retiree healthcare. The Clerk contributed $28,885 to the group health plan for OPEB costs during the fiscal year ended September 30, 2010. The Clerk's chare of the County's net OPEB obligation at September 30, 2010 was $21,356, which is recorded in the basic financial statements of the County. The annual other postemployment benefit cost is calculated based on the annual required contribution of the employer (ARC), an amount actuarially determined in accordance with GASB Statement 45. The ARC represents a level of funding that, if paid by on an ongoing basis, is projected to cover normal cost each year and amortize any unfunded actuarial liabilities over a period not to exceed thirty years. An actuarial valuation on the plan as a whole was performed in October 2008. The notes to the financial statements of the County disclose additional information regarding the other post employment benefit plan as a whole. 1101- 1219838 21 Collier County, Florida Clerk of the Circuit Court Notes to Special - purpose Financial Statements Year Ended September 30, 2010 12. Claims and Contingencies Litigation The Clerk of the Circuit Court is routinely involved as defendant, plaintiff and as a "party in interest' in carrying out its statutorily and constitutionally assigned tasks. During the year ended September 30, 2010, the Clerk was involved in approximately 92,692 collection cases. These are court actions designed to collect fees and costs imposed by the courts in criminal cases. The Clerk was involved in approximately 520 bond forfeiture actions. Those cases involve collecting forfeitures of criminal appearance bonds. There is currently one case pending before the Second District Court of Appeal. There are approximately 102 actions for foreclosure of property in which the Clerk has been a named defendant. Collier County Litigation For the past several years the Clerk has been involved in certain litigation with Collier County. All litigation with the County was resolved through mutual agreement at the end of fiscal year 2009 with the lone exception of case #21307 -4549: L.T. #04- 941 -CA reaffirming that the Clerk of Courts is accountant, auditor and custodian of all county funds and is entitled to audit the county for purposes of determining legality of payment. The Board of County Commissioners elected to go forward with this case before the Florida Supreme Court. On September 2, 2010 the case was presented before the Florida Supreme Court. On November 10, 2010 the Florida Supreme Court dismissed the appeal of the Board of County Commissioners of Collier County v. Dwight Brock, and in doing so reaffirmed the right of Clerk of Courts, Dwight Brock to audit all public funds used in county operations. The Florida Supreme Court upheld an earlier decision by The Florida Second District Court of Appeals issued on September 23, 2009. 1101- 1219838 22 Collier County, Florida Clerk of the Circuit Court Combining Balance Sheet — Agency Funds Assets Cash and cash equivalents Total assets Liabilities Due to the Collier County, Florida Board of County Commissioners Due to other governments Deposits Total liabilities September 30, 2010 Jury and Clerk's Court Ordinary Agency Registry Witness Total S 5,812,118 $ 15,647,766 $ 14,501 $ 21,474,385 S 5,812,118 $ 15,647,766 $ 14,501 $ 21,474,385 S 408,708 $ — $ — $ 408308 1,048,427 14,501 1,062,928 4,354,983 15,647,766 — 20,002,749 $ 5,812,118 $ 15,647,766 $ 14501 $ 21,474,385 I Ill I- 1219838 23 Collier County, Florida Clerk of the Circuit Court Statement of Changes in Assets and Liabilities — Agency Funds Year Ended September 30, 2010 1101 - 1219836 24 Balance Balance October 1, September 30, 2009 Additions Deletions 2010 Assets Cash and cash equivalents S 18,806,440 $ 252,960,641 $ 250,292,696 $ 21,474,385 Due from other funds - - Total assets $ 18,806,440 $ 352,960,641 $ 250 292,696 $ 21,474,385 Liabilities Due to the Collier County, Florida Board of County Commissioners $ 339,184 $ 408,708 $ 339,184 408,708 Due to other governments 1,208,478 11,423,001 11,568,551 1,062,928 Deposits 17,258,778 241,128,932 238,384,961 20,002,749 Total liabilities $ 18,806,440 $ 252,960,641 $ 250,292,696 $ 21,474,385 1101 - 1219836 24 Combining Information 1101- 1219838 111IIIIill J ERNST & YOUNC Ernst & Young LLP Report of Independent Certified Public Accountants on Internal Control Over Financial Reporting and on Compliance and Other Matters Based on an Audit of Special- Purpose Financial Statements Performed in Accordance with Government Auditing Standards Honorable Dwight E. Brock, Clerk of the Circuit Court Collier County, Florida We have audited the special - purpose financial statements of each major fund and the aggregate remaining fund information of the Collier County, Florida Clerk of the Circuit Court (the Clerk of the Circuit Court) as of and for the years ended September 30, 2010, and have issued our report thereon dated January 10, 2011, which describes that such special- purpose financial statements have been prepared for the purpose of complying with Section 218.39, Florida Statutes, and Chapter 10.577(3), Rules of the Auditor General fir Local Governmental Entitv Audits. We conducted our audit in accordance with auditing standards generally accepted in the United States and the standards applicable to financial audits contained in Government Auditing Standards, issued by the Comptroller General of the United States. Internal Control Over Financial Reporting In planning and performing our audit, we considered the Clerk of the Circuit Court's internal control over financial reporting as a basis for designing our auditing procedures for the purpose of expressing our opinion on the special - purpose financial statements, but not for the purpose of expressing an opinion on the effectiveness of the Clerk of the Circuit Court's internal control over financial reporting. Accordingly, we do not express an opinion on the effectiveness of the Clerk of the Circuit Court's internal control over financial reporting. A deficiency in internal control exists when the design or operation of a control does not allow management or employees, in the normal course of performing their assigned functions, to prevent or detect and correct misstatements on a timely basis. A material weakness is a deficiency, or combination of deficiencies, in internal control, such that there is a reasonable possibility that a material misstatement of the entity's financial statements will not be prevented, or detected and corrected on a timely basis. Our consideration of internal control over financial reporting was for the limited purpose described in the first paragraph of this section and was not designed to identify all deficiencies in internal control that might be deficiencies, significant deficiencies or material weaknesses. We did not identify any deficiencies in internal control over financial reporting that we consider to be material weaknesses, as defined above. n01- 1219838 25 III��IIIII��' JERNST &YOUNG Compliance and Other Matters As part of obtaining reasonable assurance about whether the Clerk of the Circuit Court's special - purpose financial statements are free of material misstatement, we performed tests of its compliance with certain provisions of laws, regulations, contracts, and grant agreements, noncompliance with which could have a direct and material effect on the determination of special- purpose financial statement amounts. However, providing an opinion on compliance with those provisions was not an objective of our audit and, accordingly, we do not express such an opinion. The results of our tests disclosed no instances of noncompliance or other matters that are required to be reported under Government Auditing Standards. This report is intended solely for the information and use of the Clerk of the Circuit Court, management, others within the entity, the Board of County Commissioners of Collier County, Florida and the Auditor General of the State of Florida, and is not intended to be and should not be used by anyone other than these specified parties. 16� -f IY�7 UP January 10, 2011 1101- 1219938 26 J ERNST & YOUNG Management Letter Honorable Dwight E. Brock, Clerk of the Circuit Court Collier County, Florida Ernst & Young LLP .......... We have audited the special- purpose financial statements of the general fund and the aggregate remaining fund information of the Collier County, Florida Clerk of the Circuit Court (the Clerk of the Circuit Court) as of and for the year ended September 30, 2010, and have issued our report thereon dated January 10, 2011. We conducted our audit in accordance with auditing standards generally accepted in the United States and the standards applicable to financial audits contained in Government Auditing Standards, issued by the Comptroller General of the United States. Additionally, our audit was conducted in accordance with the provisions of Chapter 10.550, Ruler of the Auditor General, which govern the conduct of local governmental audits performed in the state of Florida and require that certain items be addressed in this letter. We have also issued our report dated January 10, 2011, on internal control over financial reporting and on compliance and other matters based on an audit of special - purpose financial statements performed in accordance with Government Auditing Standards. Disclosures in that report should be considered in conjunction with this management letter. We have the following suggestions for improvement in accounting procedures and controls. Current Year Findings and Recommendations There were no findings or recommendations as a result of our current year audit. Prior Year Findings and Recommendations There were no findings or recommendations made in the prior year financial audit. Other Required Communications No matters of noncompliance with Section 218.415, Florida Statutes, regarding the investment of public funds were identified within the scope of our audit. The results of our audit disclosed no violations of laws, rules, regulations or contractual provisions or abuse, no improper or illegal expenditures, and no control deficiencies. 1101 - 1219838 27 J ERNST & YOUNG The Clerk of the Circuit Court was established by the Constitution of the State of Florida, Article VIII, Section 1(d). Section 10.554(l)(i)8., Rules of the Auditor General, requires a statement as to whether or not the Clerk complied with Section 28.35 and 28.36, Florida Statutes, regarding the budget and performance standards certified by the Florida Clerk of Courts Operations Corporation. The results of our audit did not identify any instances of noncompliance that are required to be reported. This management letter is intended solely for the information and use of the Clerk of the Circuit Court, management, the Board of County Commissioners of Collier County, Florida, and the Auditor General of the State of Florida, and is not intended to be and should not be used by anyone other than these specified parties. 16M -f � UP January 10, 2011 1101-12 1983 8 28 Assurance I Tax Transactions I Advisory About EmsT & Young III�II��. SPECIAL- PURPOSE FINANCIAL SIAl LMF.NTS Collier County, Florida Property Appraiser Year Ended September 30. 2010 With Report of Independent Certified Public Accountants Ernst & Young LLP J ERNST & YOUNG Collier County, Florida Property Appraiser Special- Purpose Financial Statements Year Ended September 30, 2010 Contents Report of Independent Certified Public Accountants ......................... Special - Purpose Financial Statements Special- Purpose Balance Sheet — General Fund ................................................ ..............................3 Special- Purpose Statement of Revenues, Expenditures, and Changes in Fund Balance — GeneralFund ................................................................................................... ..............................4 Special - Purpose Statement of Revenues, Expenditures, and Changes in Fund Balance — Budget and Actual — (Budgetary Basis) — General Fund ................................ ..............................5 Notes to Special- Purpose Financial Statements ................................................. ..............................6 Report oflndependentCertified Public Accountants on Internal Control Over Financial Reporting and on Compliance and Other Matters Based on an Audit of Special- Purpose Financial Statements Performed in Accordance with Government AuditingStandards ........................................................................................ .............................16 ManagementLetter ........................................................................................... .............................18 1011- 12I0S02 M ERNS f & YOUNG Ernst & Young LIP Fcr,t ;?48(, T. M, 0 Report of Independent Certified Public Accountants Honorable Abe Skinner, Property Appraiser Collier County, Florida We have audited the accompanying special - purpose financial statements of the general fund of the Collier County, Florida Property Appraiser (the Property Appraiser), as of and for the year ended September 30, 2010. These special- purpose financial statements are the responsibility of the Property Appraiser's management. Our responsibility is to express an opinion on these special - purpose financial statements based on our audit. We conducted our audit in accordance with auditing standards generally accepted in the United States and the standards applicable to financial audits contained in Government Auditing Standards, issued by the Comptroller General of the United States. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the special - purpose financial statements are free ofmaterial misstatement. We were not engaged to perform an audit of the Property Appraiser's internal control over financial reporting. Our audit included consideration of internal control over financial reporting as a basis for designing audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the Property Appraiser's internal control over financial reporting. Accordingly, we express no such opinion. An audit also includes examining, on a test basis, evidence supporting the amounts and disclosures in the special- purpose financial statements, assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall special- purpose financial statement presentation. We believe that our audit provides a reasonable basis for our opinion. As discussed in Note I, the accompanying special - purpose financial statements referred to above were prepared for the purpose of complying with Section 218.39, Florida Statures, Chapter 10.557(3), Rules of the Auditor General for Local Governmental Entity Audits. These special - purpose financial statements are not intended to be a complete presentation ofthe Property Appraiser's financial position and its changes in financial position, where applicable, thereof, for the year then ended in conformity with accounting principles generally accepted in the United States. Additionally, the special - purpose statements present only the Property Appraiser and do not purport to, and do not, present fairly the financial position of Collier County, Florida, as of September 30, 2010, and the changes in its financial position, where applicable, for the year then ended, in conformity with accounting principles generally accepted in the United States. 1011 - 1210502 MERNST&YOUNG In our opinion, the special - purpose financial statements referred to above present fairly, in all material respects, the financial position of the general fund of the Property Appraiser as of September 30, 2010, and the changes in financial position thereof and the budgetary comparison for the general fund for the year then ended in conformity with accounting principles generally accepted in the United States. In accordance with Government Auditing Standards, we have also issued our report dated December 9, 2010 on our consideration of the Property Appraiser's internal control over financial reporting and on our tests of its compliance with certain provisions of laws, regulations, contracts, and grant agreements and other matters. The purpose of that report is to describe the scope of our testing of internal control over financial reporting and compliance and the results of that testing, and not to provide an opinion on the internal control over financial reporting or on compliance. That report is an integral part of an audit performed in accordance with Government Auditing Standards and should be considered in assessing the results of our audit. This report is intended solely for the information and use of the Property Appraiser, management, the Board of County Commissioners of Collier County, Florida, and the Auditor General of the State of Florida, and is not intended to be and should not be used by anyone other than these specified parties. 161 f t"7 LLP December 9, 2010 1011 - 1210502 2 Collier County, Florida Property Appraiser Special - Purpose Balance Sheet — General Fund September 30, 2010 Assets Cash and cash equivalents $ 1,019,542 Total assets $ 1,019,542 Liabilities and fund balance Liabilities: Accrued liabilities $ 106,889 Due to Collier County, Florida Board of County Commissioners 807,341 Due to other taxing districts 105,312 Total liabilities 1,019,542 Fund balance - Total liabilities and fund balance $ 1,019,542 See accompanying notes. 1011 - 1210502 3 Collier County, Florida Property Appraiser Special - Purpose Statement of Revenues, Expenditures, and Changes in Fund Balance — General Fund Year Ended September 30, 2010 Revenues: Commissions and fees $ 6,552,321 Miscellaneous 805,559 Total revenues 7,357,880 Expenditures: General government: Personal services 4,847,899 Operating 1,525,524 Capital outlay 71,804 Distribution of excess fees to other taxing districts 105,312 Total expenditures 6,550,539 Excess of revenues over expenditures 807,341 Other financing uses: Distribution of excess fees to Collier County, Florida Board of County Commissioners 807,341 Total other financing uses 807,341 Excess of revenues over expenditures and other financing uses — Fund balance, beginning of year — Fund balance, end of year $ See accompanying notes. 1011 - 1210502 4 Collier County, Florida Property Appraiser Special - Purpose Statement of Revenues, Expenditures, and Changes in Fund Balance — Budget and Actual — (Budgetary Basis) — General Fund Year Ended September 30, 2010 Revenues: Commissions and fees Miscellaneous Total revenues Expenditures: General government: Personal services Operating Capital outlay Total expenditures Excess of revenues over expenditures Other financing uses: Distribution of excess fees to Collier County, Florida Board of County Commissioners Distribution of excess fees to other taxing districts Total other financing uses Excess of revenues over expenditures and other financing uses Fund balance, beginning of year Fund balance, end of year See accompanying notes. Variance With Final Budget Budget Positive Original Final Actual (Negative) $ 6,552,321 $ 6,552,321 6,552,321 6,552,321 $ 6,552,321 805,559 7,357,880 805,559 805,559 5,128,771 4,954,985 4,847,899 107,086 1,373,550 1,525,532 1,525,524 8 50,000 71,804 71,804 — 6,552,321 6,552,321 6,445,227 107,094 — 912,653 912,653 807,341 807,341 105,312 105,312 912,653 912,653 $ $ - $ 1011 -12 10502 5 Collier County, Florida Property Appraiser Notes to Special - Purpose Financial Statements September 30, 2010 1. Summary of Significant Accounting Policies Reporting Entity The Collier County, Florida Property Appraiser (the Property Appraiser) is an elected constitutional officer as provided for by the Constitution of the State of Florida. Pursuant to Chapter 129, Florida Statutes, the Property Appraiser's budget is submitted to the Florida Department of Revenue for approval, and a copy is forwarded to the Collier County, Florida Board of County Commissioners (Board). The special - purpose financial statements presented include the general fund of the Property Appraiser's office. The accompanying special- purpose financial statements were prepared for the purpose of complying with Section 218.39, Florida Statutes, and Section 10.557(3), Rules of the Auditor General.for Local Governmental Entity, ,4inks. Section 10.556(4), Rules of the Auditor General for Local Governmental Entity Audits, requires the Collier County, Florida Property Appraiser financial statements to only present fund financial statements. Accordingly, due to the omission of government -wide financial statements and related disclosures, including a management's discussion and analysis, these special - purpose financial statements do not constitute a complete presentation ofthe financial position ofthe Collier County, Florida Property Appraiser as of September 30, 2010, and the changes in its financial position for the year then ended, in conformity with Governmental Accounting Standards Board (GASB) Statement No. 34, Basic Financial Statements— and Management's Discussion and Analysis - fir State and Local Governments, but otherwise constitute financial statements prepared in conformity with U.S. generally accepted accounting principles. The financial activities of the Property Appraiser, as a constitutional officer, are included in the Collier County, Florida Comprehensive Annual Financial Report. Measurement Focus, Basis of Accounting, and Basis of Presentation These special - purpose fund financial statements report detailed information about the Property Appraiser. The focus of governmental fund financial statements is on major funds rather than reporting funds by type. Each major fund is reported in a separate column. 1011 -I210502 6 Collier County, Florida Property Appraiser Notes to Special- Purpose Financial Statements (continued) 1. Summary of Significant Accounting Policies (continued) Governmental Funds Governmental funds are accounted for using the flow of current financial resources measurement focus. Only current assets and current liabilities, generally.. are included on the special- purpose balance sheet. Operating statements of these funds present increases (i.e., revenues and other financing sources) and decreases (i.e., expenditures and other financing uses) in net current assets. The Property Appraiser's only governmental fund is the general fund. The general fund is used to account for the general operations of the Property Appraiser. The modified accrual basis of accounting is used by governmental funds. Under the modified accrual basis of accounting, revenues are recognized when susceptible to accrual (i.e., when they become measurable and available to finance current liabilities of the fiscal year). For this purpose, the Property Appraiser considers revenues to be available if they are collected within 60 days after year end. Expenditures are recorded when the related fund liability is incurred, except for compensated absences, which are recognized as expenditures to the extent they have matured. Substantially all of the Property Appraiser's revenue is received from taxing authorities. These moneys are virtually unrestricted and are revocable only for failure to comply with prescribed compliance requirements. These resources are reflected as revenue at the time of receipt; earlier if the "susceptible to accrual" criteria are met. Miscellaneous revenue is recognized as it is earned and becomes measurable and available to pay liabilities of the current period. Florida Statutes provide that the amount by which revenues exceed annual expenditures be remitted to each governmental agency or the Board immediately following the fiscal year for which the funding was provided or following the fiscal year during which other revenue was recognized. 1011- 12 10502 7 Collier County, Florida Property Appraiser Notes to Special - Purpose Financial Statements (continued) 1. Summary of Significant Accounting Policies (continued) Capital outlays expended in the general fund operations are capitalized in the basic financial statements of Collier County, Florida rather than in the governmental funds of the Property Appraiser. Refund of "Excess Fees" Florida Statutes further provide that the excess of revenues over expenditures held by the Property Appraiser be distributed to each governmental agency or the Collier County Board of County Commissioners in the same proportion as the fees paid by each governmental agency bear to total fee revenues. The amount of this distribution is recorded as a liability and as either an expenditure or other financing use - transfer out, respectively. in the accompanying special - purpose financial statements. Cash Equivalents Cash equivalents are defined as highly liquid investments with original maturities of three months or less. Compensated Absences All full -time employees of the Property Appraiser are allowed to accumulate an unlimited number of hours of unused sick time and up to 200 hours of unused vacation leave. Upon termination, employees receive 100% of allowable accumulated vacation hours and a percentage of unused sick leave, depending on years of service. not to exceed 1,040 hours. Vacation time and sick leave are included in operating costs when the payments are made to employees. The Property Appraiser does not, nor is legally required to accumulate financial resources for these unmatured obligations. Accordingly, the liability for compensated absences is not reported in the general fund, but rather is reported in the basic financial statements of Collier County, Florida. Use of Estimates The preparation of the special - purpose financial Appraiser to make a number of estimates and assets and liabilities and the disclosure of co financial statements and the reported amounts Actual results could differ from those estimates. 1011 - 1210502 statements requires management of the Property assumptions relating to the reported amounts of ntingent assets and liabilities at the date of the of revenues and expenditures during the period. Collier County, Florida Property Appraiser Notes to Special - Purpose Financial Statements (continued) 2. Budgetary Process Florida Stalu[es govern the preparation, adoption, and administration of the Property Appraiser's annual budget. The Property Appraiser prepares a budget for the general fund and submits it to the Florida Department of Revenue for approval. A copy of the approved budget is provided to the Board of County Commissioners. Any subsequent amendments to the Property Appraiser's total budget must be approved by the Florida Department of Revenue. The annual budget serves as the legal authorization for expenditures. Expenditures may not legally exceed appropriations at the fund level. Appropriations lapse at year end. Budget control is maintained at the departmental major object expenditure level. Budgetary changes within major object expenditure categories are made at the discretion of the Property Appraiser. The original budget is the first complete appropriated budget. The final budget is the original budget adjusted by all reserves, transfers, allocations, supplemental appropriations, and other legally authorized changes applicable to the fiscal year, whenever legally authorized. The Property Appraiser's budget is prepared under a budgetary basis of accounting that differs from generally accepted accounting principles (GAAP). Certain revenues received from non ad valorem commissions and other sources and expenditures paid for from these revenues are not recognized under the budgetary basis of accounting; however, the revenues and expenditures have been recognized under GAAP. Additionally, there is a difference between the budgetary basis of accounting and GAAP in the treatment of excess fee distributions to entities outside of the County's reporting entity. On a budgetary basis, distributions of excess fees are reported as other financing uses. On a GAAP basis, these distributions are reported as expenditures because there is a reduction in financial resources of the County. The actual results of operations in the statement of revenues, expenditures, and changes in fund balance — budget to actual — general fund are presented on a budgetary basis. Adjustments to convert the results of operations for the year ended September 30, 2010, from the budgetary basis of accounting to the GAAP basis ofaccounting are as follows: Miscellaneous Revenues Budgetary basis $ — Revenues and expenditures not budgeted 805,559 GAAP basis $ 805,559 1011 - 1210502 9 Collier County, Florida Property Appraiser Notes to Special- Purpose Financial Statements (continued) 3. Cash and Cash Equivalents At September 30, 2010, the carrying value of the Property Appraiser's cash and cash equivalents was as follows: Carrying Type Value Cash on hand $ 125 Deposit accounts 827,460 Repurchase agreements 191,957 Total cash and cash equivalents $ 1,019,542 Custodial Credit Risk At September 30, 2010, the Property Appraiser's deposits were entirely covered by federal depository insurance or by collateral pledged with the state treasurer pursuant to Chapter 280, Florida Statutes. Under this chapter, in the event of default by a participating financial institution (a qualified public depository), all participating institutions are obligated to reimburse the governmental entity for the loss. Interest Rate Risk The Property Appraiser has no specific investment policy regarding interest rate risk. Credit Risk The Property Appraiser's policy is to follow the guidance in Section 219.075, Florida Statutes, regarding the deposit of funds received and the investment of surplus funds. Sections 219.075 and 218.415, Florida Statutes, authorize the Property Appraiser to invest in Florida PRIME (formerly the Local Government Surplus Funds Trust Fund) or any intergovernmental investment pool authorized pursuant to the Florida Interlocal Cooperation Act; Securities and Exchange Commission registered money market funds with the highest credit quality rating from a nationally recognized rating agency; direct obligations of the United States Treasury; federal agencies and instrumentalities, or interest - bearing time deposits or savings accounts in banks organized under the laws of the United States and doing business and situated in the State of Florida, savings and loan associations which are under state supervision, or in federal savings and loan associations located in the State of Florida and organized under federal law and federal supervision, provided that any such deposits are secured by collateral as may be prescribed by law. 1011- ❑ 10502 Collier County, Florida Property Appraiser Notes to Special - Purpose Financial Statements (continued) 4. Capital Assets Capital assets used by the Property Appraiser are reported in the basic financial statements of Collier County, Florida rather than in the general fund of the Property Appraiser. Upon acquisition, such assets are recorded as expenditures in the general fund of the Property Appraiser, and are capitalized at cost in the basic financial statements of Collier County, Florida. Capital assets are valued at historical cost or estimated historical cost if actual historical cost is not available. Donated capital assets are valued at their estimated fair value on the date received. The Property Appraiser maintains custodial responsibility for the capital assets used by the office. No depreciation expense has been provided on capital assets in these special - purpose financial statements. However, depreciation expense is recorded in the basic financial statements of Collier County, Florida. 5. Long -Term Liabilities The following is a summary of changes in general long -term liabilities which are reported in the basic financial statements of Collier County, Florida: October 1, Net September 30, 2009 decrease 2010 Accrued compensated absences $ 376,826 $ (7,554) $ 369,272 Of these liabilities, approximately $25,000 is expected to be paid during the fiscal year ending September 30, 2011. These long -term liabilities are not reported in the special - purpose financial statements of the Property Appraiser since they have not matured. 6. Employee Retirement Plan Substantially all full -time employees of the Property Appraiser filling regularly established positions are eligible to participate in the State of Florida Retirement System (System), a cost - sharing multiple - employer public retirement system administered by the State of Florida, Division of Retirement. The System is a defined benefit plan for all state, and participating county, district school board, community college, and university employees (Pension Plan). The System also offers eligible employees participation in an alternative defined contribution plan (Investment Plan). The Property Appraiser participates in the F,lected State Officers' Class. The plan is administered by the State of Florida. Contribution rates are established statewide for all participating governmental units. Accordingly, the actuarial information and related disclosures attributable to the Property Appraisers' employees are not determinable. 1011 - 1210502 Collier County, Florida Property Appraiser Notes to Special- Purpose Financial Statements (continued) 6. Employee Retirement Plan (continued) Employees participating in the Pension Plan who retire at or after age 62 with 6 years of credited service, or with 30 years of service regardless of age, are entitled to a retirement benefit, payable monthly for life, equal to 1.6% for regular employees, 2% for senior management and 3% for county elected officials for each year of credited service times the final average compensation. Final average compensation is the employee's average of the five highest fiscal years of salary earned during credited service. Vested employees may retire before age 62 and receive benefits that are reduced 5°/0 for each year prior to normal retirement age. Employees participating in the Investment Plan are vested after one year of service with no age requirement. The System also provides death and disability benefits. Benefits are established by Chapter 121, Florida Statutes, and Chapter 22B, Florida Administrative Code. The Deferred Retirement Option Program (DROP) is a program that provides an alternative method for payment of retirement benefits for a specified and limited period for members of the System, effective July I, 1998. Under this program, the employee may retire and have their benefits accumulate in the Florida Retirement System Trust Fund, earning interest, while continuing to work for a system employer. The participation in the program does not change conditions of employment. When the DROP period ends, maximum of 60 months, employment must be terminated. At the time of termination of employment, the employee will receive payment of the accumulated DROP benefits, and begin receiving their monthly retirement benefit (in the same amount determined at retirement, plus annual cost -of- living increases). The System publishes an annual report that provides ten -year historical trend information about progress made in accumulating sufficient assets to pay benefits when due. This report may be obtained by writing to the Division of Retirement Research Education and Policy Section 1317 W inewood Boulevard, Building 8, Tallahassee, Florida 32399 -1560, or by calling (850) 488 -5706, or accessing their Internet site at www.dins.MyFlorida.com. The Property Appraiser is required to contribute an actuarially determined rate. The current rate is 18.64% for county elected officials, 14.57% for senior management, 10.77% for regular employees and 12.25% for DROP employees. The contribution requirements of the Property Appraiser are established and may be amended by the State of Florida. The Property Appraiser's contributions to the plan for the years ended September 30, 2010, 2009 and 2008 were 375,663, $377,053 and $374,414 respectively, equal to the required contributions for each year. 1011 -121M' 12 Collier County, Florida Property Appraiser Notes to Special- Purpose Financial Statements (continued) 7. Other Postemployment Healthcare Benefits (OPEB) Plan The County reports its obligations for OPEB pursuant to GASB Statement No. 45, Accounting and Financial Reporting ny Employers for Postemployment Benefits Other Than Pensions. Plan Description. The Property Appraiser participates in a group health care plan that covers eligible retirees, and their dependents, of the Board of County Commissioners and all Constitutional Officers with the exception of the Sheriff. The Board administers the plan and establishes the benefits. The healthcare plan does not issue a stand -alone financial report, however, additional actuarial information regarding the plan as a whole is disclosed in the notes to the financial statements of Collier County. As required by Section 112.081, Florida .Statutes, retirees and their eligible dependents are provided the same health care coverage as is offered to active employees at the same premium cost (borne by the retiree) applicable to active employees. Under Florida Statues, retirees are eligible to participate in the active medical plan by paying the active rate if they have attained age 62 and have 6 years of service or have at least 30 years of service. Employees eligible for a reduced benefit under the Florida Retirement System prior to age 62 are also eligible to participate in the medical plan. The Property Appraiser provides no subsidy to the retiree, or their dependents, for group health care. Funding Policy. The contribution requirements of the plan members and the employers are established and may be amended by the County. The plans are financed by the participating agencies on a pay as you go basis through the County's self insurance internal service fund. The Property Appraiser contributes an additional amount to the County per each active employee to accumulate resources to fund retiree health care. The Property Appraiser contributed $20,844 to the group health plan during the fiscal year ended September 30, 2010. The Property Appraiser's share of the County's net OPEB obligation at September 30, 2010, was $1 1,118, which is recorded in the basic financial statements of the County. The annual other postemployment benefit cost is calculated based on the annual required contribution of the employer (ARC), an amount actuarially determined in accordance with GASB Statement 45. The ARC represents a level of funding that, if paid by on an ongoing basis, is projected to cover normal cost each year and amortize any unfunded actuarial liabilities over a period not to exceed thirty years. An actuarial valuation on the plan as a whole was performed in December 2009. The notes to the financial statements of the County disclose additional information regarding the other post employment benefit plan as a whole. 1011-1210502 13 Collier County, Florida Property Appraiser Notes to Special- Purpose Financial Statements (continued) 8. Related -Party Transactions For the year ended September 30, 2010, the Board paid fees to the Property Appraiser that amounted to $5,796,244. At September 30, 2010, the Property Appraiser had a payable due to the Board of County Commissioners of $807,341 representing the distribution of excess fees. 9. Risk Management Collier County, Florida (the County) is exposed to various risks of loss including, but not limited to general liability, health and life, property and casualty, auto and physical damage, and workers' compensation. The County is substantially self-insured and accounts for and finances its risk of uninsured losses through an internal service fund. All liabilities associated with these self - insured risks are reported in the basic financial statements of the County. During the year ended September 30, 2010. the Property Appraiser was charged $760,323 by the County for participation in the risk management program. The County provides coverage for up to $500,000 per claim for workers' compensation, and has purchased outside excess coverage for up statutory limit for each injury or illness. The County also provides coverage for up to $100,000 per person /$200,000 per occurrence for auto and other liability claims, and has purchased outside excess coverage for up to $1,000,000 per claim. Negligence claims in excess of the statutory limits set in Section 768.20, Florida Sraiules, which provide for limited sovereign immunity of $100,000 per person /$200,000 per occurrence can only be recovered through an act of the State Legislature. The County also provides coverage for up to $100,000 per person /$200,000 per occurrence for public official's errors and omissions claims and has purchased outside excess coverage for up to $5,000,000 per claim. There have been no significant reductions in insurance coverage in the last year. Settled claims have not exceeded the insurance provided by third party carriers in any of the last three years. The County is also self - insured for health claims covering all of its employees and their eligible dependents. The County retains the first $225,000 in losses per calendar year per covered member and purchases excess coverage with a maximum lifetime limit of $2,000,000. As required by Section 112.081, Florida Stalwes, retirees and their eligible dependents are provided the same health care coverage as is offered to active employees at the same premium cost (borne by the retiree) applicable to active employees. An actuarial valuation is performed each year to estimate the amounts needed to pay prior and future claims and to establish reserves. 101 1- 1210502 14 Collier County, Florida Property Appraiser Notes to Special- Purpose Financial Statements (continued) 10. Litigation The Property Appraiser is involved as defendant or plaintiff in certain litigation and claims arising from the ordinary course of operations. In the opinion of the Property Appraiser and legal counsel, the range of potential recoveries or liabilities will not materially affect the financial position of the Property Appraiser. 1011 - 1210502 15 Ernst 8 Young LLP E E1RNsr &YouNC so 1 ,,s> snoo 1 � i .. s Report of Independent Certified Public Accountants on Internal Control Over Financial Reporting and on Compliance and Other Matters Based on an Audit of Special- Purpose Financial Statements Performed in Accordance with Government A uditing Standards Honorable Abe Skinner, Property Appraiser Collier County, Florida We have audited the special - purpose financial statements of the general fund of the Collier County, Florida Property Appraiser (the Property Appraiser) as of and for the year ended September 30, 2010, and have issued our report thereon dated December 9, 2010, which describes that such special - purpose financial statements have been prepared for the purpose of complying with Section 218.39, Florida Statutes, and Chapter 10.577(3), Rules of the Auditor General, far Local Governmental Entity Audits. We conducted our audit in accordance with auditing standards generally accepted in the United States and the standards applicable to financial audits contained in Government Auditing Standards, issued by the Comptroller General ofthe United States. Internal Control Over Financial Reporting In planning and performing our audit, we considered the Property Appraiser's internal control over financial reporting as a basis for designing our auditing procedures for the purpose of expressing our opinion on the special - purpose financial statements, but not for the purpose of expressing an opinion on the effectiveness of the Property Appraiser's internal control over financial reporting. Accordingly, we do not express an opinion on the effectiveness of the Property Appraiser's internal control over financial reporting. A deficiency in internal control exists when the design or operation of a control does not allow management or employees, in the normal course of performing their assigned functions, to prevent or detect misstatements on a timely basis. A material weakness is a deficiency, or combination of deficiencies, in internal control such that there is a reasonable possibility that a material misstatement of the entity's financial statements will not be prevented, or detected and corrected on a timely basis. Our consideration of internal control over financial reporting was for the limited purpose described in the first paragraph of this section and was not designed to identify all deficiencies in internal control that might be deficiencies, significant deficiencies or material weaknesses. We did not identify any deficiencies in internal control over financial reporting that we consider to be material weaknesses, as defined above. 1011- 121Os0' 16 JERNST&YOUNG Compliance and Other Matters As part of obtaining reasonable assurance about whether the Property Appraiser's special - purpose financial statements are free of material misstatement, we performed tests of its compliance with certain provisions of laws, regulations, contracts, and grant agreements, noncompliance with which could have a direct and material effect on the determination of special - purpose financial statement amounts. However, providing an opinion on compliance with those provisions was not an objective of our audit and, accordingly, we do not express such an opinion. The results of our tests disclosed no instances of noncompliance or other matters that are required to be reported under Government Auditing Standards. We noted certain matters that we reported to management of the Property Appraiser in a separate letter dated December 9, 2010. This report is intended solely for the information and use of the Property Appraiser, management, the Board of County Commissioners of Collier County, Florida and the Auditor General of the State of Florida, and is not intended to he and should not be used by anyone other than these specified parties. f6 n f � UP December 9, 2010 1011 - 1210502 17 JERNST &YOUNG Management Letter Honorable Abe Skinner, Property Appraiser Collier County, Florida We have audited the special - purpose financial statements of the general fund of the Collier County, Florida Property Appraiser (the Property Appraiser) as of and for the year ended September 30, 2010, and have issued our report thereon dated December 9, 2010. We conducted our audit in accordance with auditing standards generally accepted in the United States and the standards applicable to financial audits contained in Government Auditing Standards, issued by the Comptroller General of the United States. Additionally, our audit was conducted in accordance with the provisions of Chapter 10.550, Rules of the Auditor General, which govern the conduct of local governmental audits performed in the State of Florida and require that certain items be addressed in this letter. We have also issued our report dated December 9, 2010 on internal control over financial reporting and on compliance and other matters based on an audit of special - purpose financial statements performed in accordance with Government Auditing Standards. Disclosures in that report should be considered in conjunction with this management letter. Current Year Findings and Recommendations 2010 -01 Calculation of Compensated Absences Observation During our audit, we noted that the prior year comment regarding the calculation of compensated absences is still applicable. The Property Appraiser is responsible for calculating the accrual for compensated absences annually. This amount is currently only a financial statement disclosure within the Property Appraiser's financial statement. However, this amount is provided to the Board of Collier County to be recorded and disclosed within the government wide financials. We note that the accrual provided by management was incorrect due to the omission of an accrual for compensated absences earned for the last seven days of fiscal 2010, which were not reflected in the off -time report used to calculate the accrued compensated absences balance, as the off time report was for the pay period ending September 21, 2010. We note that the disclosure was adjusted to reflect the additional accrual. 1011- 1210502 19 III��IIIIIII " JERNST &YOUNG Recommendation We recommend that the Property Appraiser estimate the additional accrued compensated absences amount for the period between the last pay date in the fiscal year to September 30 of the fiscal year, in order to ensure that the amount is accurate as it is reported to the Board of County Commissioners for inclusion in the comprehensive annual financial report. Management's Response The Property Appraiser is aware of the omission of the accrual and agrees with the adjustment to the balance to be reported to the Board of County Commissioners. Further, Ernst & Young has reviewed the calculation process with the Accounting Director, in order to better ensure accurate accruals in future fiscal years. Prior Year Findings and Recommendations 2009 -01 Calculation of Compensated Absences Observation The Property Appraiser is responsible for calculating the accrual for compensated absences annually. This amount is currently only a financial statement disclosure within the Property Appraiser's financial statement. However, this amount is provided to the Board of Collier County to be disclosed within the government wide financials. We note that the accrual provided by management was incorrect due to formula errors. The Property Appraiser policy states that each employee accrual should be based on service years. As such, each person was being accrued at 50% regardless of hire date resulting in an overstated accrual. Status Comment updated and repeated. See comment 2010 -01. Other Required Communications No matters of noncompliance with Section 218.415, Florida Statutes, regarding the investment of public funds were identified within the scope of our audit. The results ofour audit disclosed no violations of Taws, rules, regulations or contractual provisions or abuse, no improper or illegal expenditures, and no control deficiencies other than the internal control recommendations included above. iai1- 1210501 19 JER,vsr &YovNc The Property Appraiser was established by the Constitution of the State of Florida, Article VIII, Section I(d). This management letter is intended solely for the information and use of the Property Appraiser, management, the Board of County Commissioners of Collier County, Florida, and the Auditor General of the State of Florida, and is not intended to be and should not be used by anyone other than these specified parties. �9t f "7 UP December 9, 2010 1011 - 121050] 20 F I ml n Y, it 1_l P Assurance I Tax I Transactions I Advisory About Ernst R Young l . 1 1, 1 li,tl I It ai..;it tLr.I Li I 1 it I r. 1 I i i [1 t I I t II i iY 11 �.�i. 1, '..V 1 1 SPECIAL- PURPOSE FINANCIAL STATEMENTS Collier County, Florida Sheriff Year Ended September 30, 2010 With Report of Independent Certified Public Accountants Ir -,,I .� o i,II[P J ERNST & YOUNG Collier County, Florida Sheriff Special - Purpose Financial Statements Year Ended September 30, 2010 Contents Report of Independent Certified Public Accountants Special - Purpose Financial Statements Special - Purpose Balance Sheet Governmental Funds .................................... ..............................3 Special - Purpose Statement of Revenues, Expenditures, and Changes in Fund Balances — Governmental Funds .................................................................... ..............................4 Special - Purpose Statement of Revenues, Expenditures, and Changes in Fund Balance — Budget and Actual — General Fund ................................................ ..............................5 Special - Purpose Statement of Net Assets - Internal Service Fund ................... ..............................6 Special - Purpose Statement of Revenues, Expenses, and Changes in Net Assets — InternalService Fund ...................................................................................... ..............................7 Special - Purpose Statement of Cash Flows - Internal Service Fund .................. ..............................8 Special - Purpose Balance Sheet Agency Funds ............................................... .............................. 9 Notes to Special - Purpose Financial Statements ................................................ .............................10 Required Supplementary Information Schedule of Funding Progress for the Retiree Health Plan ............................... .............................28 Combining Financial Information Special- Purpose Combining Balance Sheet — Agency Funds ........................... .............................29 Special - Purpose Statement of Changes in Assets and Liabilities Agency Funds .......................30 Report of Independent Certified Public Accountants on Internal Control Over Financial Reporting and on Compliance and Other Matters Based on an Audit of the Special - Purpose Financial Statements Performed in Accordance With GovernmentAuditing Standards .................................................................... .............................31 Report on Agreed -Upon Procedures Applied to Investigative Funds .............. .............................33 ManagementLetter ........................................................................................... .............................35 1007-1176607 JERNST &YOUNG EmstBYaungLLP Report of Independent Certified Public Accountants Honorable Kevin Rambosk, Sheriff Collier County, Florida We have audited the accompanying special - purpose financial statements of each major fund and the aggregate remaining fund information of the Collier County, Florida Sheriff (the Sheriff), as of and for the year ended September 30, 2010, as listed in the table of contents. These special - purpose financial statements are the responsibility of the Sheriffs management. Our responsibility is to express opinions on these special- purpose financial statements based, on our audit. We conducted our audit in accordance with auditing standards generally accepted in the United States and the standards applicable to financial audits contained in Government Auditing Standards, issued by the Comptroller General of the United States. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the special- purpose financial statements are free of material misstatement. We were not engaged to perform an audit of the Sheriffs internal control over financial reporting. Our audit included consideration of internal control over financial reporting as a basis for designing audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the Sheriffs internal control over financial reporting. Accordingly, we express no such opinion. An audit also includes examining, on a test basis, evidence supporting the amounts and disclosures in the special - purpose financial statements, assessing the accounting principles used and significant estimates made by management, and evaluating the overall special - purpose financial statement presentation. We believe that our audit provides a reasonable basis for our opinions. As discussed in Note 1, the accompanying special- purpose financial statements referred to above were prepared for the purpose of complying with Section 218.39, Florida Statutes, and Chapter 10.557, Rules of the Auditor General (or Local Governmental Entitv Audits. These special- purpose financial statements are not intended to be a complete presentation of the Sheriffs financial position as of September 30, 2010, and the changes in its financial position, where applicable, for the year then ended in conformity with accounting principles generally accepted in the United States. Additionally, the special - propose financial statements present only the Sheriff and do not purport to, and do not, present fairly the financial position of Collier County, Florida, as of September 30, 2010, and the changes in its financial position, where applicable, for the year then ended in conformity with accounting principles generally accepted in the United States. 1007-H76607 11111,111 1 I JERNST &YOUNG In our opinion, the special- purpose financial statements referred to above present fairly, in all material respects, the respective financial position of each major fund and the aggregate remaining fund information of the Sheriff as of September 30, 2010, and the respective changes in financial position and, where applicable, cash Flows thereof and the budgetary comparison for the general fund for the year then ended in conformity with accounting principles generally accepted in the United States. In accordance with Government Auditing Standards, we have also issued our report dated December 15, 2010 on our consideration of the Sheriffs internal control over financial reporting and on our tests of its compliance with certain provisions of laws, regulations, contracts and grant agreements and other matters. The purpose of that report is to describe the scope of our testing of internal control over financial reporting and compliance and the results of that testing, and not to provide an opinion on the internal control over financial reporting or on compliance. That report is an integral part of an audit performed in accordance with Government Auditing Standards and should be considered in assessing the results of our audit. The Schedule of Funding Progress for the Retiree Health Plan on page 28 is not a required part of the special - purpose financial statements but is supplementary information required by the Governmental Accounting Standards Board. We have applied certain limited procedures, which consisted principally of inquiries of management regarding the methods of measurement and presentation of the required supplementary information. However, we did not audit the information and express no opinion on it. Our audit was conducted for the purpose of forming opinions on the special- purpose financial statements. The combining financial information is presented for purposes of additional analysis and is not a required part of the special- purpose financial statements. The combining financial information has been subjected to the auditing procedures applied in the audit of the special - purpose financial statements and, in our opinion, is fairly stated in all material respects in relation to the special- purpose financial statements taken as a whole. This report is intended solely for the information and use of the Sheriff, management, the Board of County Commissioners of Collier County, Florida, and the Auditor General of the State of Florida, and is not intended to be and should not be used by anyone other than these specified parties. December 15, 2010 IfD, w 1F f7 k4p 1007-1176607 2 I u v P O ki � � J � V C 'O C u a w ° o U N i V � 0 Q. 1 U U GL v� Kon N N N N a r .c oC K D N !n O I K N n u i i K n, x N N K O h M M N N K G - M � r r - n I K ny a a M Y O T -r in n r r M o x o K a r O .f (n y I � L rA Y r ry vi n Vi O Y � n - Y I i n_ r c - n 9 C � 5 u O J 9 .lf p w C,p n 3 r H r e r c C M C Y Y w w w= c cti v� Kon N N N N a r .c oC K D N !n O I K N n u i i K n, x N N K O h M M N N K G - M � r r - n I K ny a a M Y O T -r in n r r M o x o K a r O .f (n y I � L rA Y r ry vi n Vi O Y � n - Y I i n_ r c - n 9 C � 5 u O J 9 .lf p w C,p n 3 r H r e r c C M r e r c C M cc 'C w w UJ A U LJ M� W w ti U bq U b Vj' N N �w U w N N U � 7 7 U U a U U a C 1 7 O ° C m � S J i V SE Ls a� n Z �3 O �R N O M E R. s .9 U b C Lc7 M U `G r r'n 'n C'n I meson N o 'J N r O h r r r N r N N •T m n N `n C� ax x,c e 60 — N Y Y N m e N e c c 'J N r O h r r r -- C� ax x,c e c- n U o i i ter- i no'n IC z V G V 6 9 C G 6 6 V G � U J ^ p .J- U N C O C 9 V � O d G 711 0 O U h' o a a .° w u 'v U 0 Z Collier County, Florida Sheriff Special - Purpose Statement of Revenues, Expenditures, and Changes in Fund Balance - Budget and Actual — General Fund Year Ended September 30, 2010 Revenues: Charges for services Expenditures: General government: Personal services Operating expenditures Public safety: Personal services Operating expenditures Capital outlay Total expenditures Excess of expenditures over revenues Other financing sources (uses): Transfers in: Collier County, Florida Board of County Commissioners appropriations Transfers out: Distribution of excess appropriations to Collier County, Florida Board of County Commissioners Total other financing sources Excess of revenues and other financing sources over expenditures Fund balance - beginning of year Fund balance - end of year See ticeompanying notes. Variance With Budget Budget Positive Original Final Actual (Negative) $ - $ 1,614,100 $ 1,878373 $ 264,273 3,744,300 3,412,100 3,529,650 (117,550) 126,200 126,200 132,535 (6,335) 118,355,700 117,453,400 114,349,982 3,103,418 22,626,700 22,203,100 21,067,198 1,135,902 1,635,000 1,635,000 4,314,663 (2,679 i�L31 146,487,900 144,829,800 143,394,028 1,435,772 (146.487.900) (143,215,700) (141,515.655) 1,700,045 146.482900 143,215,700 143,215,700 - - (1,700,045) (1,7001045) 146,487,900 143,215,700 141,515,655 (1,700,045) 1007-1176607 5 Collier County, Florida Sheriff Special - Purpose Statement of Net Assets — Internal Service Fund September 30, 2010 Assets Cash, cash equivalents and investments $ 12,812,794 Due from other funds 864,973 Total assets 13,677,767 Liabilities and net assets Liabilities: Self insurance claims payable 2,154,000 Net other postemployment benefit obligation 1,129,353 Total liabilities 3,283,3:53 Net assets: Unrestricted $ 10,394,414 See accompanying notes. 1007- 1176607 6 Collier County, Florida Sheriff Special - Purpose Statement of Revenues, Expenses, and Changes in Net Assets — Internal Service Fund Year Ended September 30, 2010 Operating revenues: Charges for services Operating expenses: Claims and claims expenses Reinsurance premiums Net other post employment benefit expense Administrative and other expenses Total operating expenses Operating income Nonoperating revenues: Interest income Increase in fair value of investments Change in net assets Net assets — beginning of year Net assets — end of year See accompanying notes. $ 18,132,841 16,792,075 775,389 102,903 348,089 18,018,456 114,385 77,977 6,158 198,520 10,195,894 S 101394,414 1007-1176607 7 Collier County, Florida Sheriff Special - Purpose Statement of Cash Flows - Internal Service Fund Year Ended September 30, 2010 Operating activities Cash payments for claims and claims related services Cash payments for reinsurance premiums Cash payments for administrative services and supplies Cash received from other funds for services Cash received from retirees for services Net cash used in operating activities Investing activities Investment earnings Net cash provided by investing activities Net change in cash, cash equivalents, and investments Cash, cash equivalents, and investments — beginning of year Cash, cash equivalents, and investments end of year Reconciliation of operating income to net cash used in operating activities Operating income Adjustments to reconcile operating income to net cash used in operating activities: Decrease in receivables Increase in due from other funds Increase in net other postemployment benefit obligation Increase in self- insurance claims payable Net cash used in operating activities See accompanving notes. 1007- 1176607 $ (16,740,844) (775,389) (348,089) 16,800,000 467,868 (596,454) 100,0:51 100,051 (496,403) 13,309,197 12,812.794 114,385 18,231 (864,973) 102,903 33,000 $ (596,454) Collier County, Florida Sheriff Special- Purpose Balance Sheet — Agency Funds September 30, 2010 Assets Cash and cash equivalents $ 450,824 Total assets $ 450,824 Liabilities Due to other governments $ 14,019 Due to Collier County, Florida Board of County Commissioners 52,103 Due to individuals and businesses 384,702 Total liabilities See accompanying notes. 1007-1176607 Collier County, Florida Sheriff Notes to Special - Purpose Financial Statements September 30, 2010 1. Summary of Significant Accounting Policies Reporting Entity The Collier County, Florida Sheriff (the Sheriff) is an elected constitutional officer as provided for by the Constitution of the State of Florida. Pursuant to Chapter 129, Florida Statutes, the Sheriffs budget is submitted to the Collier County, Florida Board of County Commissioners (Board) for approval. The Sheriff is the chief law enforcement officer of Collier County, Florida (the County) and is responsible for operating the County's corrections facilities. The special - purpose financial statements include the general fund, special revenue funds, internal service fund, and agency fiords of the Sheriffs office. The accompanying special - purpose financial statements were prepared for the purpose of complying with Section 218.39, Florida Statutes, and Section 10.557, Rules of the Auditor General fin- n- Local Governmental Entity Audits, Section 10.556(4), Rules of the Auditor General. /br Local Governmental Entity Audits, requires the Sheriff to only present fund financial statements. Accordingly, due to the omission of government -wide financial statements and related disclosures, including a management's discussion and analysis, these special - purpose financial statements do not constitute a complete presentation of the financial position of the Sheriff as of September 30, 2010 and the changes in its financial position and its cash flows, where applicable, for the year then ended, in conformity with Governmental Accounting Standards Board (GASB) Statement No. 34, Basic Financial Statements - and Management's Discussion and Analysis - for State and Local Governments, but otherwise constitute financial statements prepared in conformity with U.S. generally accepted accounting principles. As a result of the budgetary oversight by the Board and the financial dependency on the Board, the financial activities of the Sheriff are included in the Collier County, Florida Comprehensive Annual Financial Report. Transfers are provided by appropriations from the Board pursuant to law. Estimated receipts and budgeted fund balances must equal appropriations. The Sheriff is required to refund to the Board all excess appropriations annually; therefore, no unappropriated general fund balance is carried forward. 1007 - 1176607 10 Collier County, Florida Sheriff Notes to Special- Purpose Financial Statements (continued) 1. Summary of Significant Accounting Policies (continued) Measurement Focus, Basis of Accounting, and Basis of Presentation The special - purpose fund financial statements report detailed information about the Sheriff. The focus of governmental fund financial statements is on major funds rather than reporting funds by type. Each major fund is reported in a separate column. Governmental Funds Governmental funds are accounted for using the flow of current financial resources measurement focus. Only current assets and current liabilities, generally, are included on the special - purpose balance sheet. Operating statements for these funds present increases (i.e., revenues and other financing sources) and decreases (i.e., expenditures and other financing uses) in net current assets. The modified accrual basis of accounting is used by governmental funds. Under the modified accrual basis of accounting, revenues are recognized when susceptible to accrual (i.e., when they become measurable and available to finance current liabilities of the fiscal year). For this purpose, the Sheriff considers revenues to be available if they are collected within 60 days after year -end with the exception of grants, which have a period of availability of one year. Grants are recognized as revenue as soon as all eligibility requirements have been met. Expenditures are recorded when the related fund liability is incurred, except for compensated absences, which are recognized as expenditures to the extent they have matured. Substantially all of the Sheriff's funding is appropriated by the Board. In applying the susceptible to accrual concept to intergovernmental revenue, there are essentially two types of revenue. In one, moneys must be expended on the specific purpose or project before any amounts will be paid to the Sheriff; therefore, revenue is recognized based upon the expenditures incurred. Most grant revenue is recorded in this manner. In the other, moneys are virtually unrestricted and are revocable only for failure to comply with prescribed compliance requirements. These resources arc reflected as revenue at the time of receipt, or earlier, if the ,.susceptible to accrual" criteria are met. Other revenue is recognized as earned and becomes measurable and available to pay liabilities of the current period. 1007- 1176607 Collier County, Florida Sheriff Notes to Special - Purpose Financial Statements (continued) 1. Summary of Significant Accounting Policies (continued) Florida Statutes provide that the amount by which revenues and transfers exceed annual expenditures be remitted to the Board immediately following the fiscal year for which the funding was provided or following the fiscal year during which other revenue was recognized. The amount of this distribution is recorded as a liability and as an other financing use in the accompanying special- purpose financial statements. Capital outlays expended in governmental fund operations are recorded as capital assets in the basic financial statements of Collier County, Florida rather than in the governmental funds of the Sheriff. The Sheriff has three major governmental funds: General Fund — The general fund is used to account for the general operations of the Sheriff and includes all transactions which are not accounted for in another fund. Grant Special Revenue Fund — This fund is used to account for the proceeds of federal and state grant revenues that are legally restricted to specified purposes. Prisoner Welfare Fund — This fund is used to account for the proceeds of inmate related services and is legally restricted to specified purposes, which benefit the inmate population. The Sheriff also has one non -major fund: Federal Equitable Sharing Fund — The revenue from this fund is the result of joint investigations with federal agencies that result in the equitable sharing of the net proceeds of the forfeiture. Fund balances reported in these funds are to be used for the specified purpose of the respective fund. 1007 - 1176607 12 Collier County, Florida Sheriff Notes to Special - Purpose Financial Statements (continued) 1. Summary of Significant Accounting Policies (continued) Fiduciary Funds Fiduciary Funds — Agency Funds — These funds are used to account for assets held by the Sheriff as an agent for individuals, private organizations, and other governments. Agency funds are custodial in nature (assets equal liabilities), and do not involve measurement of results of operations or have a measurement focus. Agency funds are accounted for using the accrual basis of accounting. Proprietary Fund Internal Service Fund — This fund is used to account for the health and dental insurance services provided to departments and retirees of the Sheriff on a cost- reimbursement basis. Proprietary funds are accounted for using the economic resources measurement focus and the accrual basis of accounting. Revenues are recorded when earned and expenses are recorded when a liability is incurred, regardless of the timing of related cash flows. Cash Equivalents and Investments Cash equivalents are defined as highly liquid investments with original maturities of three months or less. Cash equivalents also include amounts deposited in Florida PRIME (formerly the Local Government Surplus Trust Fund) administered by the State Board of Administration, a Rule 2a -7 like investment pool. Shares of the investment pool are based on the pool's share price, which approximates fair value. All investments are stated at fair value. Compensated Absences All full -time employees of the Sheriff are allowed to accumulate an unlimited number of hours of unused sick time and up to 500 hours of unused vacation leave. Upon termination, employees receive 100% of allowable accumulated vacation hours and a percentage of unused sick leave, depending on years of service, not to exceed 1,000 hours. Vacation time and sick leave are included in operating costs when the payments are made to the employees. The Sheriff does not, nor is it legally required to, accumulate expendable financial resources for these unmatured obligations. Accordingly, the liability for compensated absences is not reported in the governmental funds, but rather is reported in the basic financial statements of Collier County, Florida. 1007 - 1176607 13 Collier County, Florida Sheriff Notes to Special - Purpose Financial Statements (continued) 1. Summary of Significant Accounting Policies (continued) Use of Estimates The preparation of the special - purpose financial statements requires management of the Sheriff to make a number of estimates and assumptions relating to the reported amounts of assets and liabilities and the disclosure of contingent assets and liabilities at the date of the special - purpose financial statements and the reported amounts of revenues and expenditures during that period. Significant items subject to such estimates and assumptions include the self - insurance claims payable and net other postemployment benefit obligation. Actual results could differ from those estimates. 2. Budgetary Process Florida Statutes govern the preparation, adoption, and administration of the Sheriffs annual budget. The Sheriff prepares a budget for the general fund and submits it to the Board of County Commissioners for approval. The budget is prepared on a basis consistent with U.S. generally accepted accounting principles. Any subsequent amendments to the budget must be approved by the Board. The annual budget serves as the legal authorization for expenditures. Expenditures may not legally exceed appropriations at the fund level. Appropriations lapse at year -end. Budgetary control is maintained at the departmental major object expenditure level. Budgetary changes within the major object expenditure categories are made at the discretion of the Sheriff. The Sheriff does not budget for the grant special revenue fund as it is funded by federal and state grants and is governed by those documents. Additionally, the prisoner welfare and federal equitable sharing funds do not have legally adopted budgets. The original budget is the first complete appropriated budget. The final budget is the original budget adjusted by all reserves, transfers, allocations, supplemental appropriations, and other legally authorized changes applicable to the fiscal year, whenever legally authorized. 1007-1176607 14 Collier County, Florida Sheriff Notes to Special - Purpose Financial Statements (continued) 3. Cash, Cash Equivalents and Investments At September 30, 2010, the carrying value of the Sheriffs cash, cash equivalents and investments was as follows: Average Carrying Credit Type Maturity Value Rating Cash on hand Demand deposits Local government surplus funds trust fund: Florida PRIME Fund B Federated Government Obligation Fund Treasury Bill Treasury Bill Treasury Note Treasury Bill Federal Home Loan Mortgage Corp Federal Home Loan Bank Federal National Mortgage Association Federal National Mortgage Association Federal Home Loan Bank Federal Home Loan Bank Federal Home Loan Bank Federal Home Loan Mortgage Corp Federal National Mortgage Association Total cash, cash equivalents and investments N/A $ 18,341 N/A N/A 19,932,980 N/A 52 days 712,243 AAAm 7.49 years 20,354 Unrated N/A 304,744 N/A 11 /18/2010 499,916 AAA 1/27/2011 499,787 AAA 2/28/2011 200,562 AAA 3/10/2011 499,596 AAA 12/10/2012 500,334 AAA 8/26/2013 255,176 AAA 11/26/2012 300,518 AAA 4/15/2013 500,070 AAA 6/24/2013 304,737 AAA 11/26/2014 300,386 AAA 7/27/2015 502,861 AAA 10/29/2015 505,431 AAA 11/17/2015 300,307 AAA $ 26,158,343 1007 - 1176607 15 Collier County, Florida Sheriff Notes to Special- Purpose Financial Statements (continued) 3. Cash, Cash Equivalents and Investments (continued) The total cash, cash equivalent and investments balances at September 30, 2010, were as follows: General fund $ 7,783,346 Grant special revenue fund 3,500,253 Prisoner welfare fund 886,746 Federal equitable sharing fund 724,380 Internal service fund 12,812,794 Agency funds 450,824 $ 26,158,343 Custodial Credit Risk At September 30, 2010, the Sheriff deposits were entirely covered by federal depository insurance or by collateral pledged with the State Treasurer pursuant to Chapter 280, Florida Statutes. Under this Chapter, in the event of default by a participating financial institution (a qualified public depository), all participating institutions are obligated to reimburse the government entity for the loss. Interest Rate Risk The Sheriff has no specific investment policy regarding interest rate risk. Credit Risk The Sheriff's policy is to follow the guidance in Section 219.075, Florida Statutes, regarding; the deposit of funds received and the investment of surplus funds. Sections 219.075 and 218.415, Florida Statutes, authorize the Sheriff to invest in the local government surplus funds trust fund; obligations of the United States Treasury; federal agencies and instrumentalities, or any intergovernmental pool authorized pursuant to the Florida Interlocal Corporation Act; Securities and Exchange Commission registered money market fund with the highest credit quality rating from a nationally recognized rating agency; direct interest - bearing time deposits or savings accounts in banks organized under the laws of the United States and doing business and situated in the State of Florida, savings and loan associations, which are under state supervision, or in 1007-1176607 16 Collier County, Florida Sheriff Notes to Special - Purpose Financial Statements (continued) 3. Cash, Cash Equivalents and Investments (continued) federal savings and loan associations located in the State of Florida and organized under federal law and federal supervision, provided that any such deposits are secured by collateral as may be prescribed by law. Additionally, Florida Statutes allow local governments to place public funds with institutions that participate in a collateral pool under the Florida Security for Public Deposits Act_ The pool is administered by the state treasurer, who may make additional assessments to ensure that no public funds will be lost. Florida PRIME (formerly the Local Government Surplus Funds Trust Fund Investment Pool) (the Pool) is administered by the State Board of Administration. On December 4, 2007, based on recommendations from an outside financial advisor, the State Board of Administration restructured the Pool into two separate pools. Pool A (later renamed LGIP and then Florida PRIME) consisted of all money market appropriate assets, which was approximately $12 billion or 86% of Pool assets. Pool B (later renamed Fund B Surplus Trust Fund) consisted of assets that either defaulted on a payment, paid more slowly than expected, and /or had any significant credit and liquidity risk, which was approximately $2 billion or 14% of Pool assets. In addition, full realization of the principle value of Pool B assets is not readily determinable. At the time of the restructuring, all current pool participants had their existing balances proportionately allocated into Pool A and Pool B. At September 30, 2010, the Sheriff had $732,597 invested in the Pool. Of this amount, 5712,243 is invested in Florida PRIME, which is rated "AAAm" by Standard & Poor's Ratings Services, and $20,354 in the Fund B Surplus Funds Trust Fund, which is not rated by a nationally recognized statistical rating agency. The Florida PRIME investment is fully liquid and carries a weighted average days to maturity of 52 days. Fund B is accounted for as a fluctuating NAV (net asset value) pool and the fair value factor for September 30, 2010, was 0.70706. The Fund B amount has a weighted average life of 7.49 years. Fund B cash holdings continue to be distributed to participants as they become available from maturities, sales and received income. 1007 - 1176607 17 Collier County, Florida Sheriff Notes to Special - Purpose Financial Statements (continued) 3. Cash, Cash Equivalents and Investments (continued) Concentration of Credit Risk The Sheriffs investments are included in the internal service fund which is used to account for the Sheriff s self - insured health plan. The Florida Sheriff s Multiple Employer Trust administers the Sheriffs self- insured health plan and has an investment policy that allows for the investment of funds that exceed one month's required funding by more than $100,000. Investments can be made in government securities. The Sheriffs portfolio managed by the self - insurance trust includes investments in U.S. government instrumentalities, money market funds, and demand deposits, detailed as follows, at September 30, 2010: Percent of Portfolio Federal Home Loan Mortgage Corporation 8% Federal Home Loan Bank 11% Federal National Mortgage Association 9% U.S. Treasury Note 2% U.S. Treasury Bill 12% Money Market Funds- Federated Government Obligation 20/0 Demand Deposits 56% Total 100% 4. Capital Assets Capital assets used by the Sheriff are capitalized in the basic financial statements of Collier County, Florida rather than in the governmental funds of the Sheriff. Upon acquisition, such assets are recorded as expenditures in the governmental funds of the Sheriff, and are capitalized at cost in the basic financial statements of Collier County, Florida. Capital assets are valued at historical cost or estimated historical cost if actual historical cost is not available. Donated capital assets are valued at their estimated fair value on the date received. The Sheriff maintains custodial responsibility for the capital assets used by his office. No depreciation has been provided on capital assets in these special - purpose financial statements. However, depreciation expense on these assets is recorded in the basic financial statements of Collier County, Florida. 1007- II76607 18 Collier County, Florida Sheriff Notes to Special - Purpose Financial Statements (continued) 4. Capital Assets (continued) A summary of changes in capital assets, which are reported in the basic financial statements of Collier County, Florida follows: Balance Balance October 1, September 30, 2009 Additions Retirements 2010 Machinery and equipment $ 61,510,932 $ 5,844,975 $ 3,393,498 $ 63,962,409 Less accumulated depreciation (45,626,300) (7,286,827) (2,994,800) (49,918,327) Machinery and equipment, net $ 15,884,632 $ (1,441,852) $ 398,698 $ 14,044,082 5. Long -Term Liabilities The following is a summary of changes in long -term liabilities, which are reported in the basic financial statements of Collier County, Florida: October 1, September 30, 2009 Increases Retirements 2010 Accrued compensated absences $ 11,941,614 $ 2,949,221 $ (3,160,365) $ 11,730,470 Of these liabilities, approximately $468,000 is expected to be paid during the fiscal year ending September 30, 2010. These long -term liabilities are not reported in the special - purpose financial statements of the Sheriff since they have not matured. 6. Interfund Balances and Transfers Due from and due to other funds at September 30, 2010 were as follows: General Fund Internal Service Fund Prisoner Welfare Fund Due From Due To $ 66,420 $ 864,973 864,973 66,420 $ 931,393 $ 931,393 Interfund receivables and payables generally represent recurring activities between funds. 1007-1176607 19 Collier County, Florida Sheriff Notes to Special - Purpose Financial Statements (continued) 7. Related -Party Transactions The Board of County Commissioners provided funding for the Sheriff for the year of $143,215,700. At September 30, 2010, the Sheriff had a payable due to the Board of County Commissioners of $1,757,595 comprised of the following: General fund Distribution of excess appropriations $ 1,700,045 Distribution of interest collected for September 2010 5,423 Miscellaneous payables 24 Agency funds 52,103 Total $ 1,757,595 Additionally, the Sheriff had a receivable from the Board related to services provided to the County of S 615,191 at September 30, 2010. 8. Employee Retirement Plan Substantially all full -time and part-time employees of the Sheriff are eligible to participate in the State of Florida Retirement System (System), a cost - sharing multiple- employer defined benefit plan administered by the State of Florida, Division of Retirement. The System is a defined benefit plan for all state, and participating county, district school board, community college, and university employees (Pension Plan). The System also offers eligible employees participation in an alternative defined contribution plan (investment Plan). The Sheriff and deputies participate in the Special Risk Class. The plan is administered by the State of Florida. Contribution rates are established statewide for all participating governmental units. Accordingly, the actuarial information and related disclosures attributable to the Sheriff's employees are not determinable. Employees participating in the Pension Plan who retire at or after age 62 with 6 years of credited service for regular risk or with 30 years of service regardless of age, are entitled to a retirement benefit, payable monthly for life, equal to 1.6% for regular employees, 2% for senior management, and 3% for county elected officials of their final average compensation for each year of credited service; and for special risk, after age 55 with 6 years or with 25 years of service regardless of age, are entitled to a retirement benefit payable monthly for life, up to 3% for each year of credited service times their final average compensation. Final average compensation is 1007- 1176607 20 Collier County, Florida Sheriff Notes to Special - Purpose Financial Statements (continued) 8. Employee Retirement Plan (continued) the employee's average of the five highest years of salary earned during credited service. Vested employees may retire before age 62 for regular risk and 55 for special risk and receive retirement benefits that are reduced 5% for each year prior to normal retirement age. Employees participating in the investment plan are vested after one year of service with no age requirement. The System also provides death and disability benefits. Benefits are established by Chapter 121, Florida Statutes and Chapter 22B, Florida Administrative Code. The Deferred Retirement Option Program (DROP) is a program that provides an alternative method for payment of retirement benefits for a specified and limited period for members of the System, effective July 1, 1998. Under this program, the employee may retire and have their benefits accumulate in the Florida retirement system trust fund, earning interest, while continuing to work for a System employer. The participation in the program does not change conditions of employment. When the DROP period ends, maximum of 60 months, employment must be terminated. At the time of termination of employment, the employee will receive payment of the accumulated DROP benefits, and begin receiving their monthly retirement benefit (in the same amount determined at retirement, plus annual cost -of- living increases). The System publishes an annual report that provides ten -year historical trend information about progress made in accumulating sufficient assets to pay benefits when due. That report may be obtained by writing to the Division of Retirement, Department of Management Services, 1317 Winewood Boulevard, Building 8, Tallahassee, Florida 32399, or by calling (850) 488 - 5706, or accessing their Internet site at www.frs.state.tl.us. The Sheriff is required to contribute an actuarially determined rate. The current rate is 23.25% for special risk employees, 18.64% for county elected officials, 10.77% for regular employees, 14.57% for senior management and 12.25% for DROP employees based on covered payroll. The contribution requirements of the Sheriff are established and may be amended by the State of Florida. The Sheriff's contributions to the plan for the years ended September 30, 2010, 2009, and 2008 were $14,482,279, $14,955,868 and 515,179,541, respectively, equal to the required contributions for each year. 1007-1176607 21 Collier County, Florida Sheriff Notes to Special - Purpose Financial Statements (continued) 9. Other Post Employment Benefits Plan Description The Sheriff administers a single - employer defined benefit plan (OPEB Plan) and can amend the benefit provisions. The Sheriff offers an OPEB Plan that subsidizes the cost of health care for its retirees who have 6 years of creditable service with the Sheriff and who receive a monthly retirement benefit from the Florida Retirement System. The Sheriff subsidizes approximately 20% for single coverage and 21 % for family coverage for qualifying individuals. Additionally, in accordance with Florida Statute section 112.0801, Sheriffs employees who retire and immediately begin receiving benefits tiom the FRS have the option of paying premiums to continue in the Sheriffs health insurance plan at the same group rate as for active employees. At September 30, 2010, the date of the latest actuarial valuation, Sheriff plan participation consisted of: OPEB plan participants Retirees receiving benefits Funding Policy 1,188 99 The Sheriff has the authority to establish and amend funding policy. The OPEB Plan is currently being funded on a pay -as- you -go basis. For the year ended September 30, 2010, the Sheriff contributed $ 985,789 to the OPEB Plan. Annual OPEB Cost and Net OPEB Obligation The annual cost (expense) of the Sheriffs OPEB Plan is calculated based on the Annual Required Contribution (ARC), an amount actuarially determined in accordance with the parameters of GASB Statement No. 45. The ARC represents a level of funding that, if paid on an ongoing basis, is projected to cover the normal cost each year and amortize any unfunded 1007-1176607 22 Collier County, Florida Sheriff Notes to Special - Purpose Financial Statements (continued) 9. Other Post Employment Benefits (continued) actuarial liability over a period not to exceed 30 years. The following table shows the components of the Sheriff's annual OPEB Plan cost for the year ended September 30, 2010, the amount actually contributed, and the changes in the net OPEB Plan obligation. Annual required contribution $ 1,1 08,742 Interest on net OPEB obligation 30,794 Adjustment to annual required contribution (50,844) Annual OPEB cost (expense) 1,088,692 Contributions made (985,790) Increase in net OPEB obligation (asset) 102,902 Net OPEB obligation — beginning of year 1,026,451 Net OPEB obligation (asset) — end year $ 1,129,353 No trust fund has been established for the plan. The Sheriff's annual OPEB cost, the percentage of annual OPEB cost contributed to the plan, and the net OPEB obligation for the year ended September 30, 2010 and the two preceding years were as follows: Fiscal Year Ended September 30, 2010 September 30, 2009 September 30, 2008 Funded Status and Funding Progress Percentage of Annual Annual OPEB Net OPEB OPEB Cost Cost Contributed Oblisation 1,088,692 91% $ 1,129,353 1,352,721 650/o $ 1,026,451 1,019,866 46% $ 549,868 As of the September 30, 2010 actuarial valuation date, the OPEB Plan was 0% funded, the actuarial accrued liability for benefits was $12,148,033, and the actuarial value of assets was $0, resulting in an unfunded actuarial accrued liability (UAAL) of $12,148,033. The covered payroll (annual payroll of active employees covered by the OPEB Plan) was $117.9 million, and the ratio of the UAAL to the covered payroll was 10.3 %. 1007-1176607 23 Collier County, Florida Sheriff Notes to Special - Purpose Financial Statements (continued) 9. Other Post Employment Benefits (continued) Actuarial Methods and Assumptions Actuarial valuations of an ongoing plan involve estimates of the value of reported amounts and assumptions about the probability of occurrence of events far into the future. Examples include assumptions about future employment, mortality, and the healthcare cost trend. Amounts determined regarding the funded status of the plan and the annual required contributions of the employer are subject to continual revision as actual results are compared with past expectations and new estimates are made about the future. Calculations for financial reporting purposes are based on the benefits provided under terms of the plan as understood by the employer and the plan members in effect at the time of each valuation and on the pattern of sharing of costs between the employer and plan members to that point. The projection of benefits for financial reporting purposes does not explicitly incorporate the potential effects of legal or contractual funding limitations on the pattern of cost sharing between the employer and plan members in the future. Actuarial calculations reflect a long -term perspective. Consistent with that perspective, actuarial methods and assumptions used include techniques that are designed to reduce the effects of short-term volatility in actuarial accrued liabilities and the actuarial value of assets. The actuarial methods are: Actuarial cost method Amortization method Amortization period The actuarial assumptions are: Projected Unit Credit Method Closed 30 years. Level Dollar Amount Investment rate of return 3% Discount rate 3% Healthcare cost trend rate 10% for the 2011 fiscal year grading to an ultimate: rate of 5% for the 2021 fiscal year 1007-1176607 24 Collier County, Florida Sheriff Notes to Special - Purpose Financial Statements (continued) 9. Other Post Employment Benefits (continued) Early Voluntary Separation Program The Sheriff offered an early voluntary separation program during fiscal year 2010. The program was offered from April 1, 2010 through May 17, 2010, with retirement /resignation taking effect prior to September 30, 2010 for those that elected to participate. Employees had a choice of one of the following basic options: (A) Medical coverage for a period of thirty months for coverage no more than current level (family or single), or (B) An up -front one -time payment of 50% of the value of the medical coverage in lieu of three years of coverage, or (C) A combination of both insurance coverage and a cash payment. Further, employees had a choice of one of the following supplemental options: (D) Extended medical coverage based upon accrued and not expended sick leave, beginning the first day of the month after the expiration of time granted by option A, B, or C. The unpaid sick leave balance available at the separation date, minus any hours paid in accordance with Sheriff policy, were multiplied by the hourly rate at time of separation, and then divided by the monthly projected health insurance rate to determine the number of months to be paid by the Sheriff. (E) Cash in lieu of extended medical coverage based upon accrued and not expended sick leave. This option provided for a one -time cash payment to the member equivalent to 50% of the calculated value of unpaid sick leave (less any applicable payroll taxes) using the balance available at separation date, minus any hours paid in accordance with Sheriff policy, and multiplied by the hourly rate at the date of separation. Twenty six employees elected to participate in the program. Thirteen employees selected option A, one employee selected option C. These two options, as well as supplemental option D, were included in the actuarial accrued liability of the OPEB Plan. The total cash payments made at the tennination date were $203,125 and $236,040 under options B and E, respectively. These amounts were included in fiscal year 2010 payroll expense. 1007-1176607 25 Collier County, Florida Sheriff Notes to Special- Purpose Financial Statements (continued) 10. Self- Insurance Program The Sheriff's Office participates in the Statewide Florida Sheriffs Self- Insurance Fund (the Fund) for its professional liability insurance. The Fund is managed by representatives of the participating Sheriff offices and provides professional liability insurance to participating agencies. The Fund provides liability insurance coverage subject to the following limitations: $3,100,000 for any claim involving a single individual, $3,200,000 for any incident which involves multiple claims and an aggregate of $5,000,000 ultimate net loss per Sheriff during any policy period. The Sheriff also participates in the Florida Sheriffs' Self- Insurance Fund program for workers' compensation coverage. The Florida Sheriffs' Association Workers' Compensation Insurance Trust is a limited self-insurance fund providing coverage for the first $500,000 of every claim. Reinsurance is provided through a third party for all claims exceeding $500,000 up to $10,000,000. Settled claims have not exceeded the insurance provided by third -party carriers in any of the past three years. Premiums charged to participating Sheriffs are based upon amounts believed by the Fund management to meet the estimated annual payout during the fiscal year and to pay for the estimated operating costs of the program. All liabilities associated with these self - insured risks are reported in the basic financial statements of the Statewide Florida Sheriff's Self - Insurance Fund. The Sheriff has also established a self - funded employee health plan for active employees and retirees. An internal service fund is used to account for the activities of the plan. Excess coverage has been purchased which provides specific claim excess coverage for any one incident exceeding $175,000 with a specific maximum of $2,000,000. Payments to the internal service fund are based on actuarial estimates of amounts needed to pay prior year and current year claims including claims incurred but not yet reported. 1007 -1176607 26 Collier County, Florida Sheriff Notes to Special - Purpose Financial Statements (continued) 10. Self- Insurance Program (continued) Changes in the balance of estimated insurance claims payable for the fiscal year ended September 30, 2010, is as follows: Fiscal year ending: 2009 2010 11. Claims and Contingencies Litigation New Claims Balance and Changes Claim Balance October 1 in Estimates Payments September 30 $ 2,094,000 $ 15,479,390 $ (15,452,390) $ 2,121,000 $ 2,121,000 $ 12,450,796 $ (16,725,796) $ 2,154,000 The Sheriff is involved in various claims and legal actions arising in the ordinary course of operations. In the opinion of management, the ultimate disposition of these matters will not have a material adverse effect on the Sheriffs financial statements. Federal and State Grants Grant funds received by the Sheriff are subject to audit by grantor agencies. Audits of these grants may result in disallowed costs, which may constitute a liability of the Sheriff. In the opinion of management, disallowed costs, if any, would be immaterial to the financial position of the Sheriff. 1007 - 1176607 27 Required Supplementary Information 1007-1176607 Collier County, Florida Sheriff Schedule of Funding Progress for the Retiree Health Plan 1007- 1176607 28 Actuarial Accrued UAAL as a Actuarial Actuarial Liability (AAL) — Percentage of Valuation Value of Projected Unfunded Funded Covered Covered Date Assets Unit Credit AAL Ratio Payroll Payroll 10/1/2008 $ $ 9,354,088 $ 9,354,088 0.01X� $ 128,182,544 7.3% 10/1/2009 $ - $ 14,171,709 $ 14,171,709 0.0% $ 123,296,676 11.5'% 10/1/2010 $ — $ 12,148,033 $ 12,148,033 0.0% $ 117,879,632 10.3' %� 1007- 1176607 28 Combining Financial Information 1007- 1176607 r c r Q1 N 7 7 a M N ss v� N N O O >> y W o0 C O O R N 7 o O_ O_ O C aw Y W L a M M M M M M --� T -- d �r o -v, cc C F r r c r Q1 N ss v� ss sa o O_ O_ O C Y W L a M M M M 00 00 00 00 69 A 69 £A �-+ y 00 00 CO 00 U u r cu y 9 cCa o sF, cA sa va �� 0O 0,00 10 O69 EA 69 69 U O a 1 U G � � y cC 'O � c _ r c r Q1 N .d w w o -o U `n U 0 U r e e 0 0 M M V 7 O, M N d' N N O O N L 00 00 O 00 p O O V N 7 0 00 O y N a c!j v� ds c+v vv s r- v o, o 00 00 0o a` 1 OM OM � •« — N U T y M M U Lail 69 6A ;A 69 by L. O, O, Q. � Yf 69 fH 69 O � M O vNi vNi o100 N vNi O d OA M M •-. �/l L� M N V� N t Q � O � b :~ o U w w � o y, s~ a� c� vUi O o � � b a• >v E� C's R r e e 0 0 M Report of Independent Certified Public Accountants on Internal Control Over Financial Reporting and on Compliance and Other Matters Based on an Audit of the Special - Purpose Financial Statements Performed in Accordance With Government Auditing Standards Honorable Kevin Rambosk, Sheriff Collier County, Florida We have audited the special - purpose financial statements of each major fund and the aggregate remaining fund information of the Collier County, Florida Sheriff (the Sheriff) as of and for the year ended September 30, 2010, and have issued our report thereon dated December 15, 2010, which describes that such special - purpose financial statements have been prepared for the purpose of complying with Section 218.39, Florida Statutes, and Chapter 10.557, Rules of the Auditor General for Local Governmental Entity Audits. We conducted our audit in accordance with auditing standards generally accepted in the United States and the standards applicable to financial audits contained in Government Auditing Standards, issued by the Comptroller General of the United States. Internal Control Over Financial Reporting In planning and performing our audit, we considered the Sheriffs internal control over financial reporting as a basis for designing our auditing procedures for the purpose of expressing our opinions on the special - purpose financial statements, but not for the purpose of expressing an opinion on the effectiveness of the Sheriffs internal control over financial reporting. Accordingly, we do not express an opinion on the effectiveness of the Sheriffs internal control over financial reporting. A deficiency in internal control exists when the design or operation of a control does not allow management or employees, in the normal course of performing their assigned functions, to prevent, or detect and correct misstatements on a timely basis. A material weakness is a deficiency, or combination of deficiencies, in internal control, such that there is a reasonable possibility that a material misstatement of the entity's financial statements will not be prevented, or detected and corrected on a timely basis. Our consideration of internal control over financial reporting was for the limited purpose described in the first paragraph of this section and was not designed to identify all deficiencies in internal control that might be deficiencies, significant deficiencies or material weaknesses. We did not identify any deficiencies in internal control over financial reporting that we consider to be material weaknesses, as defined above. 1007 - 1176607 31 I, IIIIIII��IIIIII ' JERNST &YOUNG Compliance and Other Matters As part of obtaining reasonable assurance about whether the Sheriffs special - purpose financial statements are free of material misstatement, we performed tests of its compliance with certain provisions of laws, regulations, contracts and grant agreements, noncompliance with which could have a direct and material effect on the determination of special - purpose financial statement amounts. However, providing an opinion on compliance with those provisions was not an objective of our audit and, accordingly, we do not express such an opinion. The results of our tests disclosed no instances of noncompliance or other matters that are required to be reported under Governrnent Auditing Standards. We noted certain matters that we reported to management of the Sheriff in a separate letter dated December 15, 2010. This report is intended solely for the information and use of the Sheriff; management, others within the entity, the Board of County Commissioners of Collier County, Florida and the Auditor General of the State of Florida, and is not intended to be and should not be used by anyone other than these specified parties. December 15, 2010 1007-1176607 3 2 JERNST &YOUNG Ernst &VOUngLLP Report on Agreed -Upon Procedures Applied to Investigative Funds Honorable Kevin Rambosk, Sheriff Collier County, Florida We have performed the procedures enumerated below, which were agreed to by management of the Collier County, Florida, Sheriff (the Sheriff), solely to assist you in evaluating the procedures and policies as defined by the Sheriff over its investigative funds for the year ended September 30, 2010. The Sheriffs management is responsible for the Sheriffs compliance with those procedures and policies. This agreed -upon procedures engagement was conducted in accordance with attestation standards established by the American Institute of Certified Public Accountants. The sufficiency of these procedures is solely the responsibility of the party specified in this report. Consequently, we make no representation regarding the sufficiency of the procedures described below either for the purpose for which this report has been requested or for any other purpose. The procedures we performed and our findings are summarized as follows: • We randomly selected 25 investigative fund transactions during the fiscal year ended September30, 2010 (the population sampled from was provided by the Sheriffs management and included transactions from October 1, 2009 through June 15, 2010). We performed the following procedures with respect to the Sheriffs policies and procedures over investigative funds for the 25 transactions in our sample. • We obtained the "Disbursement for Investigation" form noting that the form was properly completed and authorized by appropriate personnel. No exceptions were noted. • We obtained the "Purchase of Evidence/ Information Voucher" noting that the form was properly completed to reflect the expenses incurred within the investigation procedures, that the investigative expenditures were properly supported, and that the use of funds was for authorized purposes. No exceptions were noted. • We noted that the un -used funds returned, if applicable, were properly deposited per review of the corresponding deposit and bank statement detail and noted that the amount deposited agreed to the amount returned per the "Receipt for Funds Received" form detail. No exceptions were noted. 1007-1 naem 33 IIIIII��IIII��' JERNST &YOUNG We were not engaged to and did not conduct an examination, the objective of which would be the expression of an opinion on compliance. Accordingly, we do not express such an opinion. Had we performed additional procedures, other matters might have come to our attention that would have been reported to you. This report is intended solely for the information and use of the management of the Sheriff, and is not intended to be and should not be used by anyone other than this specified party. 16� -f "7 UP December 15, 2010 1007-1176607 34 J ERNST & YOUNG Management Letter Honorable Kevin Rambosk, Sheriff Collier County, Florida Ernst & Young LLP WY de 'zJ0 We have audited the special - purpose financial statements of each major fund and the aggregate remaining fund information of the Collier County, Florida Sheriff (the Sheriff) as of and for the year ended September 30, 2010, and have issued our report thereon dated December 15, 2010. We conducted our audit in accordance with auditing standards generally accepted in the United States and the standards applicable to financial audits contained in Government Auditing Standards, issued by the Comptroller General of the United States. Additionally, our audit was conducted in accordance with the provisions of Chapter 10.550, Rules of the Auditor General, which govern the conduct of local governmental audits performed in the State of Florida and require that certain items be addressed in this letter. We have also issued our report dated December 15, 2010, on internal control over financial reporting and on compliance and other matters based on an audit of special - purpose financial statements performed in accordance with Government Auditing Standards. Disclosures in that report should be considered in conjunction with this management letter. We have the following suggestions for improvement in accounting procedures and controls. Current Year Findings and Recommendations 2010 -1 Other Postempioyment Benefits Contribution Observation The Sheriff applies Governmental Accounting Standards Board (GASB) Statement No 45, Accounting and Financial Reporting by Employers ,for Postemployment Benefits Other Than Pensions (OPEB). The GASB defines what constitutes contributions made in relation to the annual required contributions of the employer (ARC) as follows: An employer has made a contribution to the ARC if the employer has (a) made payments of benefits directly to or on behalf of a retiree or beneficiary, (b) made premium payments to an insurer, or (c) irrevocably transferred assets to a trust, or equivalent arrangement, in which plan assets are dedicated to providing benefits to retirees and their beneficiaries in accordance with the terms of the plan and are legally protected from creditors of the cmployer(s) or plan administrator. The Sheriff's contribution for fiscal years 2008 through 2010 related to retiree healthcare claim payments made under the Sheriff's health plan was based on an actuarial estimate as actual retiree claim 1007 - 1176607 35 JERNST &YOUNG data was not obtained separately from active employee claims. The estimated contributions for fiscal year 2010 were deemed to be $985,789. As the number of retirees continues to increase, the amount of the contribution has become more significant and should be based on actual data rather than an estimate. Recommendation We recommend that the Sheriff obtain retiree claim information separately for future years in order to more accurately determine the actual contribution for the year. Management's Response We will work with the actuary to ensure they provide actual claims information regarding the contributions for retirees and active employees versus estimates. Prior Year Findings and Recommendations During the course of our audit we noted that appropriate action had been taken upon certain recommendations and suggested accounting procedures outlined in the prior year's Management Letter. Those comments have not been repeated. Prior year comments that were not implemented or were only partially implemented in the current year have been repeated below: 2008 -1 Cash Receipts Process Observation As part of the cash receipts process, funds received for deposit into the operating account are forwarded to the fiscal clerk (or an alternate /back up clerk) responsible for receipt and bank deposit preparation. The fiscal clerk enters the receipts into the cash management module of general ledger system and generates a Receipt for Funds Received form for each individual cash receipt. A Cash Receipts by Method report is generated to indicate the total of the cash receipts for preparation of the bank deposit. Bank deposits are typically prepared by the fiscal clerk but can be prepared also by the cash supervisor or the manager. Once the deposits are prepared, they are secured in a safe until the courier arrives to take the deposit to the bank. The cash clerk and the other individuals mentioned above all have access to the safe. Typically the cash clerk accesses the safe to retrieve the deposit for the courier. On rare occasions, when the courier is not available, or if there is a large deposit late in the day, either the cash supervisor, the manager, or finance director can make deposits at the bank. 1007-1 ueeu7 36 I'I I�IIIIIIIIIIIIIi "' JERNST &YOUNG At month end, the Cash Receipt Summary Report is generated from the system which provides a query of all cash receipts entered by date to be used in the bank reconciliation process. All cash receipts posted to the general ledger for the month are reviewed against the corresponding bank statement detail by the budget manager as part of the bank reconciliation process to ensure completeness of the funds received. We were informed about an incident that occurred during fiscal year 2009 whereby an immaterial amount of cash that was received and entered for deposit was allegedly misappropriated as it was not deposited according to the bank's records. This was identified through the month end bank reconciliation process. Additionally, we were informed about a similar occurrence whereby a similar amount of cash was allegedly misappropriated from the Sheriff's investigative funds around the same time period. Investigate funds are also secured in the safe and controls are in place surrounding the disbursing and receiving of the cash for investigative purposes. The individuals with access to the investigative cash in order to distribute funds to deputies and replenish the funds include the same individuals with access to the safe as described above. Recommendation We recommend that the Sheriff review its current process and determine if duties can be further segregated surrounding the cash receipts process and access limited further, as appropriate, with respect to cash bank deposits and investigative funds. The basic idea underlying segregation of incompatible duties is that no employee or group should be in a position both to perpetrate and to conceal errors or fraud in the normal course of their duties. In general, the principal incompatible duties to be segregated are: • Custody of assets, • Authorization or approval of related transactions affecting those assets, and • Recording or reporting of related transactions. An essential feature of segregation of incompatible duties /responsibilities within an organization is that no one employee or group of employees has exclusive control over any transaction or group of transactions. In addition, a control over the processing of a transaction should not be performed by the same individual who is responsible for recording or reporting the transaction. The fiscal clerk, or other individuals as noted above, maintains custody of the cash receipts (handles receipts of currency, lists checks and prepares bank deposits) and also records receipts in the general ledger. Although mitigating controls to detect potential improprieties, such as, the bank reconciliation process being performed by an independent individual, are operating effectively, it would be ideal to implement prevention controls by segregating the duties of recording in the general ledger and custody of the cash receipts as well as restricting access to 1007-1176607 37 j I II��IIIII ��IIIIII' JERNST &YOUNG cash deposits and investigative funds to only necessary individuals. If it is not practical to implement all such measures based on staff resource constraints, we recommend that the Sheriff consider implementing additional monitoring controls over the process such as having someone independent of the tasks above (1) review the bank deposit slip for completeness against the general ledger cash receipts report and (2) after the deposit is made, verify that the total agrees to the bank deposit receipt or on -line confirmation on a daily basis. This should be evidenced by a signature or other sign off on the documents. Management's Original Response The entire cash receipts process is being reviewed and documented in detail. Controls will be strengthened where possible given staffing limitations. Current Year Update We understand that certain improvements have been made with respect to the cash receipts process; however, we recommend that management consider whether additional controls can be implemented in this area. Further, due to changes in key positions over the past year, we recommend that processes be reviewed to ensure that segregation of duties, or mitigating controls as appropriate, are designed and operating effectively. Current Year Update- Management's Response Because of recent changes in assignments for a number of personnel, all assignments of duties will be reviewed during FYI l to ensure adequate segregation of duties is in place for all procedures. Any additional procedures and /or necessary changes will be implemented and adopted as standard operating procedures. Other Required Communications No matters of noncompliance with Section 218.415, Florida Statutes, regarding the investment of public funds were identified within the scope of our audit. The results of our audit disclosed no violations of laws, regulations, or contractual provisions or abuse, no improper or illegal expenditures, and no control deficiencies that are not significant deficiencies other than the internal control recommendations included above. The Sheriff was established by the Constitution of the State of Florida, Article VIII, Section 1(d). 1007-1176607 38 JERNST &YOUNG II This management letter is intended solely for the information and use of the Sheriff, management, the Board of County Commissioners of Collier County, Florida, and the Auditor General of the State of Florida, and is not intended to be and should not be used by anyone other than these specified parties. '& � -f "7 UP December 15, 2010 1007-1176607 39 Fnr,l � Y._nnxi I I P Assurance I Tax I Transactions I Advisory AUUOt Ernst k Vaung SPECIAL- PURPOSE FINANCIAL, STATEMENTS AND O1 [IF R RFPORIS Collier County, Florida Supervisor of F,lections Year Folded September 30, 2010 With Report of Independent Certified Public Accountants J ERNST & YOUNG Collier County, Florida Supervisor of Elections Special- Purpose Financial Statements and Other Reports Year Ended September 30, 2010 Contents Report of Independent Certified Public Accountants Special- Purpose Financial Statements BalanceSheet ..................................................................................................... ..............................3 Statement of Revenues, Expenditures, and Changes in Fund Balance .............. ..............................4 Statement of Revenues, Expenditures, and Changes in Fund Balance — Budget and Actual — General Fund ................................................................. ..............................5 Notes to Financial Statements ............................................................................ ..............................6 Other Reports Report of Independent Certified Public Accountants on Internal Control Over Financial Reporting and on Compliance and Other Matters Based on an Audit of the Special- Purpose Financial Statements Perlormed in Accordance With Government Auditing Standards .................................................................... .............................16 ManagementLetter ........................................................................................... .............................18 1011 - 1209950 JERNST &YOUNG Ernst & Young LLP II Report of Independent Certified Public Accountants The Honorable Jennifer J. Edwards, Supervisor of Elections Collier County, Florida We have audited the accompanying special - purpose financial statements of each major fund of the Collier County, Florida Supervisor of Elections (the Supervisor of Elections), as of and for the year ended September 30, 2010 as listed in the table of contents. These financial statements are the responsibility of the Supervisor of Elections' management. Our responsibility is to express opinions on these financial statements based on our audit. We conducted our audit in accordance with auditing standards generally accepted in the United States and the standards applicable to financial audits contained in Government Auditing Standards, issued by the Comptroller General of the United States. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. We were not engaged to perform an audit of the Supervisor of Elections' internal control over financial reporting. Our audit included consideration of internal control over financial reporting as a basis for designing audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the Supervisor of Elections' internal control over financial reporting. Accordingly, we express no such opinion. An audit also includes examining, on a test basis, evidence supporting the amounts and disclosures in the special - purpose financial statements, assessing the accounting principles used and significant estimates made by management and evaluating the overall special - purpose financial statement presentation. We believe that our audit provides a reasonable basis for our opinions. As discussed in Note I, the accompanying special - purpose financial statements referred to above were prepared for the purpose of complying with Section 218.39, Florida Statutes, and Chapter 10.577(3), Rules of the Auditor General for Local Governmental Entity Audits. These special - purpose financial statements are not intended to be a complete presentation of the Supervisor of Elections' financial position and its changes in financial position, where applicable, thereof, for the year then ended in conformity with accounting principles generally accepted in the United States. Additionally, the special- purpose statements present only the Supervisor of Elections and do not purport to, and do not, present fairly the financial position of Collier County, Florida, as of September 30, 2010, and the changes in its financial position, where applicable, for the year then ended, in conformity with accounting principles generally accepted in the United States. 1 01 1- 1209 950 (IIII��IIIII��I'III JERNST &YOUNG In our opinion, the special - purpose financial statements referred to above present fairly, in all material respects, the financial position of each major fund of the Supervisor of Elections as of September 30, 2010, and the changes in financial position thereof and the budgetary comparison for the general fund for the year then ended in conformity with accounting principles generally accepted in the United States. In accordance with Government Auditing Standards, we have also issued our report dated December 1, 2010, on our consideration of the Supervisor of Elections' internal control over financial reporting and on our tests of its compliance with certain provisions of laws, regulations, contracts, and grant agreements and other matters. The purpose of that report is to describe the scope of our testing of internal control over financial reporting and compliance and the results of that testing, and not to provide an opinion on the internal control over financial reporting or on compliance. That report is an integral part of an audit performed in accordance with Government Auditing Standards and should be considered in assessing the results of our audit. This report is intended solely for the information and use of the Supervisor of Elections, management, the Board of County Commissioners of Collier County, Florida, and the Auditor General of the State of Florida, and is not intended to be and should not be used by anyone other than these specified parties. -f 17 kp m Deceber I. 2010 u Q 1011 - 1209850 Collier County, Florida Supervisor of Elections Assets Cash and cash equivalents Due from other funds Total assets Liabilities and fund balance Liabilities: Accounts payable Accrued liabilities Due to Collier County, Florida Board of County Commissioners Due to other funds Deferred revenue Total liabilities Fund balance Total liabilities and fund balance See accompanying notes. Balance Sheet September 30, 2010 Grant General Special Total Fund Revenue 2010 $ 414,664 $ 156,343 $ 571,007 — 337 337 $ 414,664 $ 156,680 $ 571,344 $ 168,263 $ 662 $ 168,925 49,862 — 49,862 196,202 — 196,202 337 — 337 — 131,171 131,171 414,664 131,833 546,497 — 24,847 24,847 $ 414,664 $ 156,680 $ 571,344 1011 - 1209850 3 Collier County, Florida Supervisor of Elections Statement of Revenues, Expenditures and Changes in Fund Balance For the Year Ended September 30, 2010 Revenues: Intergovernmental Interest Miscellaneous Total revenues Expenditures: General government: Personal services Operating expenditures Capital outlay Total expenditures Excess of expenditures over revenues Other financing sources (uses): Transfers in: General Fund Collier County, Florida Board of County Commissioners appropriations Operating transfers out: Special revenue fund Distribution of excess appropriations: Collier County. Florida Board of County Commissioners Total other financing sources Deficiency of revenues and other financing sources under expenditures Fund balance - October I, 2009 Fund balance - September 30, 2010 See accompanying notes. Grant General Special Total Fund Revenue 2010 $ 14,944 $ 53,074 $ 68,018 - 669 669 - 1,000 1,000 14.944 54,743 69,687 1,846,784 - 1,846,784 1,198,303 73,704 1,272,007 20,480 - 20,480 3,065,567 73,704 3,139,271 (3,050,623) (18,961) (3,069,584) 5,417 5,417 3,244,700 - 3,244,700 (5,417) - (5,417) (188,660) - (188,660) 3,050,623 5,417 3,056,040 - (13,544) (13,544) 38,391 38,391 $ - $ 24,847 $ 24,847 1011- 12098so 4 Collier County, Florida Supervisor of Elections Statement of Revenues, Expenditures and Changes in Fund Balance — Budget and Actual — General Fund For the Year Ended September 30, 2010 Revenues Expenditures: General government: Personal services Operating Capital outlay Total expenditures Excess of expenditures over revenues Other financing sources (uses): Operating transfers in: Collier County, Florida Board of County Commissioners appropriations Operating transfers out: Special revenue fund Distribution of excess appropriations: Collier County, Florida Board of County Commissioners Total other financing sources Excess of revenues and other financing sources over expenditures Fund balance — October I, 2009 Fund balance — September 30, 2010 See accompanying nore.s. 1011- 120985u Variance With Final Budget Budget Positive Original Final Actual (Negative) $ 7,600 $ 7,600 $ 14,944 $ 7,344 1,978,100 1,978,100 1,846,784 131,316 1,259,300 1,244,513 1,198,303 46,210 14,900 24,270 20,480 3,790 3,252,300 3,246,883 3,065,567 181,316 (3,244,700) (3,239,283) (3,050,623) 188,660 3,244,700 3,244,700 3,244,700 — (5,417) (5,417) — — (188,660) (188,660) 3,244,700 3,239,283 3,050,623 (188,660) 5 Collier County, Florida Supervisor of Elections Notes to Financial Statements September 30, 2010 1. Summary of Significant Accounting Policies and Practices Reporting Entity The Collier County, Florida Supervisor of Elections (Supervisor of Elections) is an elected constitutional officer as provided for by the Constitution of the State of Florida. Pursuant to Chapter 129, Florida Statutes, the Supervisor of Elections' budget is submitted to the Collier County, Florida Board of County Commissioners (Board) for approval. The financial statements presented include the general fund and grant special revenue fund of the Supervisor of Elections' office. The accompanying financial statements were prepared for the purpose of complying with Section 218.39, Florida Statutes, and Section 10.557(3), Rules ofthe Auditor General for Local Governmental Entity Audits. Section 10.556(4), Rules q/ the Auditor General for Local Governmental Entity Audits, requires the Collier County, Florida Supervisor of Elections financial statements to only present fund financial statements. Accordingly, due to the omission of government -wide financial statements and related disclosures including a management's discussion and analysis, these financial statements do not constitute a complete presentation of the financial position of the Collier County, Florida Supervisor of Elections as of September 30, 2010, and the changes in its financial position for the year then ended, in conformity with Governmental Accounting Standards Board (GASB) Statement No. 34, Basic Financial Statements - and Management's Discussion and Analysis -,for State and Local Governments, but otherwise constitute financial statements prepared in conformity with accounting principles generally accepted in the United States of America. As a result of the budgetary oversight by the Board and financial dependency on the Board, the financial activities of the Supervisor of Elections are included in the Collier County, Florida Comprehensive Annual Financial Report. Transfers are provided by appropriations from the Board pursuant to law. Estimated receipts and budgeted general fund balances must equal appropriations. The Supervisor of Elections is required to refund to the Board all excess appropriations annually; therefore, no unappropriated general find balance is carried forward. 1011- 1209850 6 Collier County, Florida Supervisor of Elections Notes to Financial Statements (continued) 1. Summary of Significant Accounting Policies and Practices (continued) Measurement Focus, Basis of Accounting, and Basis of Presentation Fund financial statements report detailed information about the Supervisor of Elections. The focus of governmental fund financial statements is on a major fund rather than reporting by type. Each major fund is reported in a separate column. Governmental Funds Governmental funds are accounted for using the flow of current financial resources measurement focus. Only current assets and current liabilities, generally, are included on the balance sheet. Operating statements for this fund present increases (i.e., revenues and other financing sources) and decreases (i.e., expenditures and other financing uses) in net current assets. The Supervisor of Elections has the following major governmental funds: General Fund — The general fund is used to account for the general operations of the Supervisor of Elections, and includes all revenues and expenditures which are not accounted for in another fund. Grant Special Revenue Fund The grants fund is used to account for the activities of voter education and poll worker training grants from the State of Florida. The modified accrual basis of accounting is used by governmental funds. Under the modified accrual basis of accounting, revenues are recognized when susceptible to accrual (i.e., when they become measurable and available to finance liabilities of the current fiscal year). For this purpose, the Supervisor of Elections considers revenues to be available if they are collected within 60 days after year end. Expenditures are recorded when the related fund liability is incurred, except for compensated absences, which are recognized as expenditures to the extent they have matured. The appropriations from the Board are the primary source of funds considered to be susceptible to accrual. Intergovernmental revenues are recognized when eligibility requirements are met and related amounts are available from the grantor. 1011 - 1209850 7 Collier County, Florida Supervisor of Elections Notes to Financial Statements (continued) L Summary of Significant Accounting Policies Practices (continued) Interest income and other revenues are recognized as they are earned and become measurable and available to pay liabilities of the current period. Florida Statutes provide that the amount by which revenues and transfers exceed annual expenditures be remitted to the Board immediately following the fiscal year for which the funding was provided or following the fiscal year during which other revenues were recognized. The amount of this distribution is recorded as a liability and as another financing use in the accompanying financial statements. Capital outlays expended in general fund operations are capitalized in the basic financial statements of Collier County, Florida rather than in the governmental funds of the Supervisor of Elections. Cash Equivalents Cash equivalents are defined as highly liquid investments with original maturities of three months or less. Cash equivalents in the Local Government Surplus Funds Trust Fund are administered by the State Board of Administration (SBA), a 2a -7 like investment pool. Shares of the investment pool are based on the pool's share price, which approximates fair value. At September 30, 2010, the Supervisor of Elections had no amounts on deposit in the SBA. Compensated Absences All full -time employees of the Supervisor of Elections are allowed to accumulate an unlimited number of hours of unused sick time and up to 440 hours of unused vacation leave. Effective October I, 2007, the vacation leave limit was increased to 480 hours. Upon termination, employees receive 100% of allowable accumulated vacation hours and a percentage of unused sick leave, depending on years of service. Vacation time and sick leave are included in operating costs when the payments are made to employees. The Supervisor of Elections does not, nor is legally required to accumulate financial resources for these unmatured obligations. Accordingly, the liability for compensated absences is not reported in the general fund, but rather is reported in the basic financial statements of Collier County, Florida. 1011 - 1209850 8 Collier County, Florida Supervisor of Elections Notes to Financial Statements (continued) t. Summary of Significant Accounting Policies and Practices (continued) Use of Estimates The preparation of the financial statements requires management of the Supervisor of Elections to make a number of estimates and assumptions relating to the reporting of assets and liabilities and the disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenditures during the period. Actual results could differ from those estimates. 2. Budgetary Process Florida Statutes govern the preparation, adoption and administration of the Supervisor of Elections' annual budget. The Supervisor of Elections submits a budget for the general fund to the Board of County Commissioners for approval. The budget is prepared on a basis consistent with accounting principles generally accepted in the United States of America. The annual budget serves as the legal authorization for expenditures. Any subsequent amendments to the Supervisor's total budget must be approved by the Board. Expenditures may not legally exceed appropriations at the fund level. Appropriations lapse at year end. Budgetary control is maintained at the departmental major object expenditure level. Budgetary changes within major object expenditure categories are made at the discretion of the Supervisor of Elections. The Supervisor does not budget for the grant special revenue fund as it is funded by State grants and is governed by those documents. The original budget is the first complete appropriated budget. The final budget is the original budget adjusted by all reserves, transfers, allocations. supplemental appropriations and other legally authorized changes applicable to the fiscal year, whenever legally authorized. I0II- 1209850 9 Collier County, Florida Supervisor of Elections Notes to Financial Statements (continued) 3. Cash and Cash Equivalents At September 30, 2010, the carrying value of the Supervisor of Elections' cash and cash equivalents was as follows: Carrying Credit Value Rating Cash on hand $ 200 N/A Demand deposits 570,807 N/A Total cash and cash equivalents $ 571,007 Custodial Credit Risk At September 30, 2010, the Supervisor of Elections' deposits were entirely covered by federal depository insurance or by collateral pledged with the State Treasurer pursuant to Chapter 280, Florida Statutes. Under this chapter, in the event of default by a participating financial institution (a qualified public depository), all participating institutions are obligated to reimburse the governmental entity for the loss. Credit Risk The Supervisor of Elections' policy is to follow the guidance in Section 219.075, Florida Statutes, regarding the deposit of funds received and the investment of surplus funds. Sections 219.075 and 218.415, Florida Statutes, authorize the Supervisor of Elections to invest in the Local Government Surplus Funds Trust Fund or any intergovernmental investment pool authorized pursuant to the Florida Interlocal Cooperation Act: Securities and Exchange Commission registered money market funds with the highest credit quality rating from a nationally recognized rating agency; direct obligations of the United States Treasury; federal agencies and instrumentalities or interest - bearing time deposits or savings accounts in banks organized under the laws of the United States and doing business and situated in the State of Florida, savings and loan associations which are under state supervision, or in federal savings and loan associations located in the State of Florida and organized under federal law and federal supervision, provided that any such deposits are secured by collateral as may be prescribed by law. 1011 - 1209850 10 Collier County, Florida Supervisor of Elections Notes to Financial Statements (continued) 3. Cash and Cash Equivalents (continued) Interest Rate Risk The Supervisor of Elections has no specific investment policy regarding interest rate risk. 4. Capital Assets Capital assets used by the Supervisor of Elections are reported in the basic financial statements of Collier County, Florida rather than in the governmental ftmds of the Supervisor of Elections. Upon acquisition, such assets are recorded as expenditures in the general fund of the Supervisor of Elections, and are capitalized at cost in the basic financial statements of the Board. Capital assets are valued at historical cost or estimated historical cost if actual historical cost is not available. Donated capital assets are valued at their estimated fair value on the date received. The Supervisor of Elections maintains custodial responsibility for the capital assets used by the office. No depreciation expense has been provided on capital assets in these financial statements. However, depreciation expense is recorded in the basic financial statements ofthe Board. 5. Long -Term Liabilities The following is summary of changes in long -term liabilities which are reported in the basic financial statements of Collier County, Florida: October 1, September 30, 2009 Increase Retirement 2010 Accrued compensated absences $ 178,529 $ 95,167 $ 41,741 $ 231,955 Of these liabilities, approximately $42,000 is expected to be paid during the fiscal year ending September 30, 2010. These long -term liabilities are not reported in the financial statements of the Supervisor of Elections since they have not matured. 1011 - 1209850 Collier County, Florida Supervisor of Elections Notes to Financial Statements (continued) 6. Employee Retirement Plans Substantially all full -time employees of the Supervisor of Elections filling regularly established positions are eligible to participate in the State of Florida Retirement System (System), a cost - sharing multiple - employer defined benefit plan administered by the State of Florida, Division of Retirement. The System is a defined benefit plan for all state, and participating county, district school board, community college and university employees (Pension Plan). The System also offers eligible employees participation in an alternative defined contribution plan (Investment Plan). The Supervisor of Elections participates in the Elected State Officers' Class. The plan is administered by the State of Florida. Contribution rates are established statewide for all participating governmental units. Accordingly, the actuarial information and related disclosures attributable to the Supervisor of Elections' employees are not determinable. Employees participating in the Pension Plan who retire at or after age 62 with 6 years of credited service, or with 30 years of service regardless of age, are entitled to a retirement benefit, payable monthly for life, equal to 1.6% for regular employees, 2% for senior management and 3% for county elected officials for each year of credited service times the final average compensation. Final average compensation is the employee's average of the five highest fiscal years of salary earned during credited service. Vested employees may retire before age 62 and receive benefits that are reduced 5% for each year prior to normal retirement age. Employees participating in the Investment Plan are vested after one year of service with no age requirement. The System also provides death and disability benefits. Benefits are established by Chapter 121, Florida Siatides, and Chapter 22B, Florida Adminisirative Code. The Deferred Retirement Option Program (DROP) is a program that provides an alternative method for payment of retirement benefits for a specified and limited period for members of the System, effective July I, 1998. Under this program, the employee may retire and have their benefits accumulate in the Florida Retirement System Trust Fund, earning interest, while continuing to work for a system employer. The participation in the program does not change conditions of employment. When the DROP period ends, maximum of 60 months, employment must be terminated. At the time of termination of employment, the employee will receive payment of the accumulated DROP benefits, and begin receiving their monthly retirement benefit (in the same amount determined at retirement, plus annual cost -of- living increases). 1011 - 1209850 12 Collier County, Florida Supervisor of Elections Notes to Financial Statements (continued) 6. Employee Retirement Plans (continued) The System publishes an annual report that provides ten -year historical trend information about progress made in accumulating sufficient assets to pay benefits when due. This report may be obtained by writing to the Division of Retirement Research Education and Policy Section 1317 Winewood Boulevard, Building 8, Tallahassee, Florida 32399 -1560, or by calling (850) 488 -5706, or accessing their Internet site at www.dms.MyFlorida.com. The Supervisor of Elections is required to contribute an actuarially determined rate. The current rate is 18.64% for county elected officials, 14.57% for senior management, 10.77% for regular employees and 12.25% for DROP employees. The contribution requirements of the Supervisor of Elections are established and may be amended by the State of Florida. The Supervisor of Elections' contributions to the plan for the years ended September 30, 2010, 2009 and 2008, were $135,823, $130,784 and $127,461, respectively, equal to the required contributions for each year. 7. Other Postemployment Healthcare Benefits (OPEB) Plan Plan Description. The Supervisor of Elections participates in a group health care plan that covers eligible retirees, and their dependents, of the Board of County Commissioners and all Constitutional Officers with the exception of the Sheriff. The Board administers the plan and establishes the benefits. The healthcare plan does not issue a stand -alone financial report, however additional actuarial information regarding the plan as a whole is disclosed in the Notes to the Financial statements of Collier County. Under Florida Statutes. retirees are eligible to participate in the active medical plan by paying the active rate if they have attained age 62 and have 6 years of service or have at least 30 years of service. Employees eligible for a reduced benefit under the Florida Retirement System prior to age 62 are also eligible to participate in the medical plan. The Supervisor of Elections provides no subsidy to the retiree, or their dependents, for group health care. Funding Policy. The contribution requirements of the plan members and the employers are established and may be amended by the County. The plans are financed by the participating agencies on a pay as you go basis through the County's self insurance internal service fund. Participating agencies contribute an additional amount per each active employee to fund retiree health care. The Supervisor's agency had an actuarial accrued liability of $5,941 as of September 30, 2010. 1011 - 1209850 13 Collier County, Florida Supervisor of Elections Notes to Financial Statements (continued) 7. Other Postemployment Healthcare Benefits (OPEB) Plan (continued) The annual other postemployment benefit cost is calculated based on the annual required contribution of the employer (ARC), an amount actuarially determined in accordance with GASB Statement 45. The ARC represents a level of funding that, if paid by on an ongoing basis, is projected to cover normal cost each year and amortize any unfunded actuarial liabilities over a period not to exceed thirty years. An actuarial valuation on the plan as a whole was performed in December 2009. The notes to the financial statements of the County disclose additional information regarding the other post employment benefit plan as a whole. 8. Related -Party Transactions For the year ended September 30, 2010, the Board provided funding for the Supervisor of Elections that amounted to $3,244,700. At September 30, 2010, the Supervisor of Elections had a payable due to the Board of $196,202 comprised as follows: Distribution of excess appropriations $ 188,660 Distribution of interest earnings 1,996 Amounts due for various services 5,546 Total due to Board of County Commissioners $ 196,202 9. Risk Management Collier County, Florida (the County) is exposed to various risks of loss including, but not limited to, general liability, health and life, property and casualty, auto and physical damage and workers' compensation. The County is substantially self- insured and accounts for and finances its risk of uninsured losses through an internal service fund. All liabilities associated with these self - insured risks are reported in the basic financial statements of the County. During the year ended September 30, 2010, the Supervisor was charged $234,675 by the County for participation in the risk management program. The County provides coverage for up to $500,000 per claim for workers' compensation, and has purchased outside excess coverage for up statutory limit for each injury or illness. The County also provides coverage for up to $100,000 per person /$200,000 per occurrence for auto and other liability claims, and has purchased outside excess coverage for up to $1,000,000 per claim. Negligence claims in excess of the statutory limits set in Section 768.20, Florida Statzetes, which 101 1- 1209850 14 Collier County, Florida Supervisor of Elections Notes to Financial Statements (continued) 9. Risk Management (continued) provide for limited sovereign immunity of $100,000 per person /$200,000 per occurrence can only be recovered through an act of the State Legislature. The County also provides coverage for up to $100,000 per person /$200,000 per occurrence for public official's errors and omissions claims and has purchased outside excess coverage for up to $5,000,000 per claim. There have been no significant reductions in insurance coverage in the last year. Settled claims have not exceeded the insurance provided by third party carriers in any of the last three years. The County is also self - insured for health claims covering all of its employees and their eligible dependents. The County retains the first $225,000 in losses per calendar year per covered member and purchases excess coverage with a maximum lifetime limit of $2,000,000. As required by Section 112.081, Florida Statutes, retirees and their eligible dependents are provided the same health care coverage as is offered to active employees at the same premium cost (borne by the retiree) applicable to active employees. An actuarial valuation is performed each year to estimate the amounts needed to pay prior and future claims and to establish reserves. 10. Contingencies Grant funds received by the Supervisor of Elections are subject to audit by grantor agencies. Audits of these grants may result in disallowed costs, which may constitute a liability of the office of the Supervisor of Elections. In the opinion of management, disallowed costs, if any, would be immaterial to the financial position of the Supervisor of Elections. 1011 - 1209850 15 Other Reports 1011 - 1'09850 J ERNST &YOUNG Ernst & Young LLP 1 Report of Independent Certified Public Accountants on Internal Control Over Financial Reporting and on Compliance and Other Matters Based on an Audit of the Special- Purpose Financial Statements Performed in Accordance With Government Auditing Standards The Honorable Jennifer J. Edwards, Supervisor of Elections Collier County, Florida We have audited the special - purpose financial statements of each major fund of the Collier County, Florida Supervisor of Elections (the Supervisor of Elections) as of and for the year ended September 30, 2010, and have issued our report thereon dated December I, 2010, which describes that such special - purpose financial statements have been prepared for the purpose of complying with Section 218.39, Florida .Statutes, and Chapter 10.557(3), Rules of the Auditor General for Local Governmental Entity Audits. We conducted our audit in accordance with auditing standards generally accepted in the United States and the standards applicable to financial audits contained in Government Audiling .Standards, issued by the Comptroller General of the United States. Internal control over financial reporting In planning and performing our audit, we considered the Supervisor of Elections' internal control over financial reporting as a basis for designing our auditing procedures for the purpose of expressing our opinion on the special - purpose financial statements, but not for the purpose of expressing an opinion on the effectiveness of the Supervisor of Elections' internal control over financial reporting. Accordingly, we do not express an opinion on the effectiveness of the Supervisor of Elections' internal control over financial reporting. A deficiency in internal control exists when the design or operation of a control does not allow management or employees, in the normal course of performing their assigned functions, to prevent, or detect and correct misstatements on a timely basis. A material weakness is a deficiency, or combination of deficiencies, in internal control, such that there is a reasonable possibility that a material misstatement of the entity's financial statements will not be prevented, or detected and corrected on a timely basis. Our consideration of internal control over financial reporting was for the limited purpose described in the first paragraph of this section and was not designed to identify all deficiencies in internal control that might be deficiencies, significant deficiencies or material weaknesses. We did not identify any deficiencies in internal control over financial reporting that we consider to be material weaknesses, as defined above. 1011 - 1209850 16 III��IIIIIII� �' JERNST &YOUNG Compliance and other matters As part of obtaining reasonable assurance about whether the Supervisor of Elections' special - purpose financial statements are free of material misstatement, we performed tests of its compliance with certain provisions of laws, regulations, contracts and grant agreements, noncompliance with which could have a direct and material effect on the determination of special - purpose financial statement amounts. However, providing an opinion on compliance with those provisions was not an objective of our audit and, accordingly, we do not express such an opinion. The results of our tests disclosed no instances of noncompliance or other matters that are required to be reported under Government Auditing Standards. This report is intended solely for the information and use of the Supervisor of Elections, management, the Board of County Commissioners of Collier County, Florida, and the Auditor General of the State of Florida, and is not intended to be and should not be used by anyone other than these specified parties. f"t LL December 1, 2010 1011- 1309850 17 J ERNST & YOUNG Ernst & Young LLP ,soon Management Letter The Honorable Jennifer J. Edwards, Supervisor of Elections Collier County, Florida We have audited the special - purpose financial statements of each major fund of the Collier County, Florida Supervisor of Elections (the Supervisor) as of' and for the year ended September 30, 2010, and have issued our report thereon dated December I, 2010. We conducted our audit in accordance with auditing standards generally accepted in the United States and the standards applicable to financial audits contained in Government Auditing .Standards, issued by the Comptroller General of the United States. Additionally, our audit was conducted in accordance with the provisions of Chapter 10.550, Rules of the Auditor General, which govern the conduct of local governmental audits performed in the state of Florida and require that certain items be addressed in this letter. We have also issued our report dated December I, 2010 on internal control over financial reporting and on compliance and other matters based on an audit of special - purpose financial statements performed in accordance with Government Auditing Standards. Disclosures in that report should be considered in conjunction with this management letter. We have the following suggestions for improvement in accounting procedures and controls. Current Year Findings and Recommendations There were no findings or recommendations as a result of our current year financial audit. Prior Year Findings and Recommendations There were no findings or recommendations made in the prior year financial audit. Other Required Communications No matters of noncompliance with Section 21 8.415, Florida Statutes, regarding the investment of public funds were identified within the scope of our audit. The results of our audit disclosed no violations of laws, rules, regulations or contractual provisions or abuse, no improper or illegal expenditures, and no control deficiencies. 1011 - 1209850 18 J ERNST & YOUNG The Supervisor of Elections was established by the Constitution of the State of Florida, Article VIII, Section 1(d). This management letter is intended solely for the information and use of the Supervisor of Elections, management, the Board of County Commissioners of Collier County, Florida, and the Auditor General of the State of Florida, and is not intended to be and should not be used by anyone other than these specified parties. December 1, 2010 1011 - 1209850 19 Finn[ N Younq I I P Assurance I Tax I Transactions I Advisory About Ernst R Young SPECIAL- PIIRPOSI: FINANCIAI, STATICMRN "IS Collier County, Florida Tax Collector Years Ended September 30, 2010 and 2009 With Report of Independent Certified Public Accountants Ernst & Young LLP JERNST &YOUNG Collier County, Florida Tax Collector Special- Purpose Financial Statements Years Ended September 30, 2010 and 2009 Contents Report of Independent Certified Public Accountants ........................................ ..............................I Special- Purpose Financial Statements Special- Purpose Balance Sheets — General Fund .............................................. ..............................3 Special - Purpose Statements of Revenues, Expenditures, and Changes in Fund Balance — GeneralFund ................................................................................................... ..............................4 Special- Purpose Statement of Revenues, Expenditures, and Changes in Fund Balance — Budget and Actual — General Fund — Budgetary Basis .................................. ..............................5 Special- Purpose Statements of Fiduciary Assets and Liabilities - Agency Funds ..........................6 Notes to Special - Purpose Financial Statements ................................................. ..............................7 Report of Independent Certified Public Accountants on Internal Control Over Financial Reporting and on Compliance and Other Matters Based on an Audit of Special - Purpose Financial Statements Performed in Accordance with Government AuditingStandards ........................................................................................ .............................19 ManagementLetter ........................................................................................... .............................21 1011- 1210831 J ERNST & YOUNG Ernst 8 Young LLP _ 1 561 T'", RWO ,3700 Report of Independent Certified Public Accountants Honorable Larry H. Ray, Tax Collector Collier County, Florida We have audited the accompanying special- purpose financial statements of the general fund and the aggregate remaining fund information of the Collier County, Florida Tax Collector (the Tax Collector), as of and for the years ended September 30, 2010 and 2009, as listed in the table of contents. 'These special - purpose financial statements are the responsibility of the Tax Collector's management. Our responsibility is to express opinions on these special - purpose financial statements based on our audits. We conducted our audits in accordance with auditing standards generally accepted in the United States and the standards applicable to financial audits contained in Government Auditing Standards, issued by the Comptroller General of the United States. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the special - purpose financial statements are free of material misstatement. We were not engaged to perform an audit of the Tax Collector's internal control over financial reporting. Our audits included consideration of internal control over financial reporting as a basis for designing audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the 'Tax Collector's internal control over financial reporting. Accordingly, we express no such opinion. An audit also includes examining, on a test basis, evidence supporting the amounts and disclosures in the special - purpose financial statements, assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall special - purpose financial statement presentation. We believe that our audits provide a reasonable basis for our opinions. As discussed in Note I, the accompanying special - purpose financial statements referred to above were prepared for the purpose of complying with Section 218.39, Florida Statutes, and Chapter 10.557(3), Rules of the Auditor General. for Local Governmental Entity Audits. These special - purpose financial statements are not intended to be a complete presentation of the Tax Collector's financial position and its changes in financial position, where applicable, therefore, for the years then ended, in conformity with accounting principles generally accepted in the United States. Additionally, the special - purpose statements present only the Tax Collector and do not purport to, and do not, present fairly the financial position of Collier County, Florida, as of September 30, 2010 and 2009, and the changes in its financial position, where applicable, for the years then ended, in conformity with accounting principles generally accepted in the United States. 1011 - 1210831 JERNST &YOUNG In our opinion, the special- purpose financial statements referred to above present fairly, in all material respects, the respective financial position of the general fund and the aggregate remaining fund information of the Tax Collector as of September 30, 2010 and 2009, and the respective changes in financial position, thereof for the years then ended, and the budgetary comparison for the general fund for the year ended September 30, 2010, in conformity with accounting principles generally accepted in the United States. In accordance with Government Auditing Standards, we have also issued our report dated December 9, 2010, on our consideration of the Tax Collector's internal control over financial reporting and on our tests of its compliance with certain provisions of laws, regulations, contracts, and grant agreements and other matters. The purpose of that report is to describe the scope of our testing of internal control over financial reporting and compliance and the results of that testing, and not to provide an opinion on the internal control over financial reporting or on compliance. That report is an integral part of an audit performed in accordance with Government Auditing Standards and should be considered in assessing the results of our audit. This report is intended solely for the information and use of the Tax Collector, management, the Board of County Commissioners of Collier County, Florida, and the Auditor General of the State of Florida, and is not intended to be and should not be used by anyone other than these specified parties. December 9, 2010 1011- 1210831 Collier County, Florida Tax Collector Special - Purpose Balance Sheets — General Fund See accompanying notes. 1011 - 1210831 3 September 30 2010 2009 Assets Cash and cash equivalents $ 8,916,768 $ 9,733,833 Due from other funds 48,581 64,402 Prepaid rent 20,367 20,463 Security deposit 4,628 4,628 Total assets $ 8,990,344 $ 9,823,326 Liabilities and fund balance Liabilities: Accounts payable $ 11,348 $ 35,035 Due to Collier County, Florida Board of County Commissioners 7,935,116 8,645,361 Due to other governmental agencies 1,043,880 1,142,930 Total liabilities 8,990,344 9,823,326 Fund balance — - Total liabilities and fund balance $ 8,990,344 $ 9,823,326 See accompanying notes. 1011 - 1210831 3 Collier County, Florida Tax Collector Special - Purpose Statements of Revenues, Expenditures, and Changes in Fund Balance — General Fund Revenues: Commissions and fees Miscellaneous Total revenues Expenditures: General government: Personal services Operating Capital outlay Distribution of excess commissions and fees to other governmental agencies Total expenditures Excess of revenues over expenditures Other financing uses: Distribution of excess commissions and fees to Collier County, Florida Board of County Commissioners Total other financing uses Excess of revenues over expenditures and other financing uses Fund balance, beginning of year Fund balance, end of year See accompanying nodes. 1011-12 1083 1 Year Ended September 30, 2010 2009 $ 19,792,647 $ 20,753,850 456,531 482,413 20,249,178 21,236,263 9,467,219 9,390,413 1,753,251 1,988,959 49,712 68,600 1,043,880 1,142,930 12,314,062 12,590,902 7,935,116 8,645,361 (7,935,116) (8,645,361) (7,935,116) (8,645,361) 4 Collier County, Florida Tax Collector Special - Purpose Statement of Revenues, Expenditures, and Changes in Fund Balance — Budget and Actual — General Fund (Budgetary Basis) Year Ended September 30, 2010 Variance With Expenditures: Final Budget General government: Budget Positive Personal services Original Final Actual (Negative) Revenues: 2,395,652 1,753,251 1,753,251 - Commissions and fees $ 18,958,124 $ 19,792,647 $19,792,647 $ - Miscellaneous 380,000 456,531 456,531 Total revenues 19,338,124 20,249,178 20,249,178 - Expenditures: General government: Personal services 9,586,604 9,467,219 9,467,219 - Operating 2,395,652 1,753,251 1,753,251 - Capital outlay 50,242 49,712 49,712 - Total expenditures 12,032,498 11,270,182 11,270,182 - Excess of revenues over expenditures 7,305,626 8,978,996 8,978,996 - Other financing uses: Distribution of excess commissions and fees to Collier County, Florida Board of County Commissioners (6,575,063) (7,935,116) (7,935,116) - Distribution of excess commissions and fees to other governmental agencies (730,563) (1,043,880) (1,043,880) - Total other financing uses (7,305,626) (8,978,996) (8,978,996) - Excess of revenues over expenditures and other financing uses - - Fund balance, beginning of year - Fund balance, end of year $ $ - $ $ See accompanving notes. 1011 - 12 1083 1 5 Collier County, Florida Tax Collector Special - Purpose Statements of Fiduciary Assets and Liabilities — Agency Funds September 30 2010 2009 Assets Cash and cash equivalents $ 6,584,222 $ 6,525,291 Accounts receivable 10,572 17,770 Due from other funds 5,402 — Total assets 6,600,196 $ 6,543,061 Liabilities Due to other funds $ 53,983 $ 64,402 Due to Collier County, Florida Board of County Commissioners 744,528 778,433 Due to other governmental agencies 4,300,060 4,206,340 Due to individuals and businesses 1,501,625 1,493,886 Total liabilities $ 6600,196 $ 6,543,061 See accompanying notes, 1011 - 1210831 6 Collier County, Florida Tax Collector Notes to Special- Purpose Financial Statements September 30, 2010 1. Summary of Significant Accounting Policies Reporting Entity The Collier County, Florida Tax Collector (Tax Collector) is an elected constitutional officer as provided for by the Constitution of the State of Florida. Pursuant to Chapter 195.087, Florida Statutes, the Tax Collector's budget is submitted to the Florida Department of Revenue for approval, and a copy is forwarded to the Collier County, Florida Board of County Commissioners (Board). The special - purpose financial statements presented include the general fund and agency funds of the Tax Collector's office. The accompanying special - purpose financial statements were prepared for the purpose of complying with Section 218.39, Florida Statutes, and Section 10.557(3), Rules of the Auditor General_for Local Governmental Entity Audits. Section 10.556(4), Rules gJ the Auditor General fin- Local Governmental Entity Audits, requires the Collier County, Florida Tax Collector to only present fund financial statements. Accordingly, due to the omission of government -wide financial statements and related disclosures, including a management's discussion and analysis, these special- purpose financial statements do not constitute a complete presentation of the financial position of the Collier County, Florida Tax Collector as of September 30, 2010 and 2009, and the changes in its financial position for the years then ended, in conformity with Governmental Accounting Standards Board (GASB) Statement No. 34, Basic Financial Statements and Management's Discussion and Analysis -- fin- State and Local Governments, but otherwise constitute special- purpose financial statements prepared in conformity with U.S. generally accepted accounting principles (GAAP). The financial activities of the Tax Collector, as a constitutional officer, are included in the Collier County, Florida Comprehensive Annual Financial Report. Measurement Focus, Basis of Accounting, and Basis of Presentation These special- purpose fund financial statements report detailed information about the Tax Collector. The focus of governmental fund financial statements is on major funds rather than reporting funds by type. Each major fund is reported in a separate column. 1011 - 1210831 Collier County, Florida Tax Collector Notes to Special- Purpose Financial Statements (continued) 1. Summary of Significant Accounting Policies (continued) Governmental Funds Governmental funds are accounted for using the flow of current financial resources measurement focus. Only current assets and current liabilities, generally, are included on the special - purpose balance sheets. Operating statements for these funds present increases (i.e., revenues and other financing sources) and decreases (i.e., expenditures and other financing uses) in net current assets. The Tax Collector's only governmental fund is the general fund. The general fund is used to account for the general operations of the Tax Collector and includes all transactions not accounted for in another fund. The modified accrual basis of accounting is used by governmental funds. Under the modified accrual basis of accounting, revenues are recognized when susceptible to accrual (i.e., when they become measurable and available to finance current liabilities of the fiscal year). For this purpose, the Tax Collector considers revenues to be available if they are collected within 60 days after the end of the current period. Expenditures are recorded when the related fund liability is incurred, except for certain compensated absences, which are recognized as expenditures to the extent they have matured. Interest income and other revenue are recognized as they are earned and become measurable and available to pay liabilities of the current period. Substantially all of the Tax Collector's revenue is received from taxing authorities. These monies are virtually unrestricted and are revocable only for failure to comply with prescribed compliance requirements. These resources are reflected as revenue at the time of receipt; earlier if the `'susceptible to accrual" criteria are met. Florida Statutes provide that the amount by which revenues exceed annual expenditures be remitted to each governmental agency or the Board immediately following the fiscal year for which the funding was provided or following the fiscal year during which other revenue was recognized. Capital outlays expended in the general fund operations are capitalized in the basic financial statements of Collier County, Florida (the County) rather than in the governmental funds of the Tax Collector. 1011 - 1210831 8 Collier County, Florida Tax Collector Notes to Special - Purpose Financial Statements (continued) 1. Summary of Significant Accounting Policies (continued) Fiduciary Funds Agency Funds— Fiduciary funds are used to account for assets held by the Tax Collector in a trustee capacity or as an agent for individuals, private organizations, and other governments. Agency funds are custodial in nature (assets equal liabilities), and do not involve measurement of results of operations or have a measurement focus. Agency funds are accounted for using the accrual basis ofaccounting. Refund of "Excess Fees" Florida Statutes further provide that the excess of revenues over expenditures held by the Tax Collector be distributed to each governmental agency or the Collier County Board of County Commissioners in the same proportion as the fees paid by each governmental agency bear to total fee revenues. The amount of this distribution is recorded as a liability and as either an expenditure or other financing use- transfer out, respectively, in the accompanying special- purpose financial statements. Cash and Cash Equivalents Cash and cash equivalents are highly liquid investments with original maturities of three months or less. Compensated Absences All full -time employees of the Tax Collector are allowed to accumulate an unlimited number of hours of unused sick time and up to 240 hours of unused vacation leave. Upon termination, employees receive 100% of allowable accumulated vacation hours and a percentage of unused sick leave, depending on years of service. Vacation and sick leave payments are included in operating costs when the payments are made to the employees. The Tax Collector does not, nor is legally required to, accumulate financial resources for these unmatured obligations. Accordingly, the liability for compensated absences is not reported in the general fund, but rather is reported in the basic financial statements of Collier County, Florida. 1011 - 1210831 9 Collier County, Florida Tax Collector Notes to Special - Purpose Financial Statements (continued) 1. Summary of Significant Accounting Policies (continued) Property Taxes Property taxes in Collier County are levied by the Board and other taxing authorities. The millage levies are determined on the basis of estimates of revenue needs and the total taxable valuations within the jurisdiction of the Board and other taxing authorities. No aggregate ad valorem tax millage in excess of 10 mills on the dollar can be levied by the Board of County Commissioners against property in the County as specified in Florida Statutes Section 200.071. Each year the total taxable property valuation is established by the Collier County, Florida Property Appraiser, and the list of property assessments is submitted to the State Department of Revenue for approval. Taxes, assessed as of December I of each year, are due and payable on November I of each year or as soon thereafter as the assessment roll is opened for collection. Pursuant to Florida law, all owners of property have the responsibility of ascertaining the amount due and paying it before April I of the year following the year in which the tax was assessed. Chapter 197, Florida Statutes, governs property tax collections as follows: Current Taxes All property taxes become due and payable on November I, and are delinquent on April 1 of the following year. Discounts are allowed for early payment of 4% in November; 3% in December; 2% in January; and I% for payment in February. Unpaid Taxes — Sale of Tax Certificates The Tax Collector advertises, as required by Florida Statutes, and sells tax certificates on all real property for unpaid taxes. The land is struck off the tax roll to the purchaser of the tax certificate. Certificates not sold are struck off to the County. The Tax Collector must receive payment before the certificates are delivered. Any person owning land upon which a tax certificate has been sold may redeem the tax certificate by paying the Tax Collector the face amount of the tax certificate plus interest and other costs. Tax Deeds Two years after the purchase of a tax certificate the owner may file an application for tax deed sale. The County, as a certificate owner, exercises similar procedures. Tax deeds are issued to the highest bidder for the property which is sold at public auction. The Clerk of the Circuit Court administers these sales. 1011 - 1210831 10 Collier County, Florida Tax Collector Notes to Special - Purpose Financial Statements (continued) 1. Summary of Significant Accounting Policies (continued) Use of Estimates The preparation of these special - purpose financial statements requires management of the Tax Collector to make a number of estimates and assumptions relating to the reported amounts of assets and liabilities and the disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenditures during the period. Actual results could differ from those estimates. 2. Budgetary Process Florida Statutes govern the preparation, adoption, and administration of the Tax Collector's annual budget. The Tax Collector submits a budget for the general fund to the Florida Department of Revenue for approval. A copy of the approved budget is provided to the Board of County Commissioners. Any subsequent amendments to the Tax Collector's total budget must be approved by the Florida Department of Revenue. The budget for the general fund is generally prepared on a basis consistent with U.S. generally accepted accounting principles. The annual budget serves as the legal authorization for expenditures. Fxpenditures may not legally exceed appropriations at the fund level. Appropriations lapse at year end. Budget control is maintained at the departmental major object expenditure level. Budgetary changes within major object expenditure categories are made at the discretion of the Tax Collector. The original budget is the first complete appropriated budget. The final budget is the original budget adjusted by all reserves, transfers, allocations, supplemental appropriations, and other legally authorized changes applicable to the fiscal year, whenever legally authorized. There is a difference between the budgetary basis of accounting and generally accepted accounting principles (GAAP) in the treatment of excess fee distributions to entities outside of the County's reporting entity. On a budgetary basis, distributions ofexcess fees through this fund are reported as other financing uses. On a GAAP basis, these distributions are reported as expenditures because there is a reduction in the financial resources of the County. 1011 - 1210831 Collier County, Florida Tax Collector Notes to Special- Purpose Financial Statements (continued) 3. Cash and Cash Equivalents At September 30, 2010 and 2009, the carrying value of the Tax Collector's cash and cash equivalents were as follows: 2010 2009 Carrying Carrying Credit Type Value Value Rating Cash on hand $ 39,370 $ 39,590 N/A Demand deposits 15,461,620 16,219,534 N/A Total cash and cash equivalents $ 15,500,990 $ 16,259,124 Such amounts are reported as $8,916,768 and $6,584,222 for 2010 and $9,733,833 and $6,525,291 for 2009 in the general and agency funds, respectively. Custodial Credit Risk At September 30, 2010, the Tax Collector's deposits were entirely covered by federal depository insurance or by collateral pledged with the State Treasurer pursuant to Chapter 280, Florida Statutes. Under this Chapter, in the event of default by a participating financial institution (a qualified public depository), all participating institutions are obligated to reimburse the governmental entity for the loss. Interest Rate Risk The Tax Collector has no specific investment policy regarding interest rate risk. Credit Risk The Tax Collector's policy is to follow the guidance in Section 219.075, Florida .Statutes, regarding the deposit of funds received and the investment of surplus funds. Sections 219.075 and 218.415, Florida Statutes, authorize the Tax Collector to invest in Florida PRIME (formerly the Local Government Surplus Funds Trust) or any intergovernmental investment pool authorized pursuant to the Florida Interlocal Cooperation Act: Securities and Exchange Commission registered money market funds with the highest credit quality rating from a 1011- 1210831 12 Collier County, Florida Tax Collector Notes to Special- Purpose Financial Statements (continued) 3. Cash and Cash Equivalents (continued) nationally recognized rating agency; direct obligations of the United States Treasury; federal agencies and instrumentalities or interest- bearing time deposits or savings accounts in banks organized under the laws of the United States and doing business and situated in the state of Florida, savings and loan associations which are under state supervision, or in federal savings and loan associations located in the state of Florida and organized under federal law and federal supervision, provided that any such deposits are secured by collateral as may be prescribed by law. 4. Capital Assets Capital assets used by the Tax Collector are capitalized in the basic financial statements of Collier County, Florida rather than in the governmental funds of the Tax Collector. Upon acquisition, such assets are recorded as expenditures in the general fund of the Tax Collector, and are capitalized at cost in the basic financial statements of the Collier County, Florida. Capital assets are valued at historical cost or estimated historical cost if actual historical cost is not available. Donated capital assets are valued at their estimated fair value on the date received. The Tax Collector maintains custodial responsibility for the capital assets used by the office. No depreciation expense has been provided on capital assets in these special - purpose financial statements. However, depreciation expense on these assets is recorded in the basic financial statements of Collier County, Florida. 5. Long -Term Liabilities The following is a summary of changes in long -term liabilities which are reported in the basic financial statements of Collier County, Florida: October 1 Net September 30 2009 additions 2010 Accrued compensated absences $ 1,150,777 $ (48,927) $ 1,101,850 October 1 Net September 30 2008 additions 2009 Accrued compensated absences $ 1,137,639 $ 13,138 $ 1,150,777 ion - 1210x31 13 Collier County, Florida Tax Collector Notes to Special- Purpose Financial Statements (continued) 5. Long -Term Liabilities (continued) Of these liabilities, approximately $25,000 is expected to be paid during the fiscal year ending September 30, 2010. These long -term liabilities are not reported in the special - purpose financial statements of the Tax Collector since they have not matured. 6. Employee Retirement Plan Substantially all full -time employees of the Tax Collector are eligible to participate in the State of Florida Retirement System (System), a cost - sharing multiple - employer defined benefit plan administered by the State of Florida, Division of Retirement. The System is a defined benefit plan for all state, and participating county, district school board, community college, and university employees (Pension Plan). 'The System also offers eligible employees participation in an alternative defined contribution plan (Investment Plan). The Tax Collector participates in the Elected State Officers' Class. The plan is administered by the State of Florida. Contribution rates are established statewide for all participating governmental units. Accordingly, the actuarial information and related disclosures attributable to the Tax Collectors' employees are not determinable. Employees participating in the Pension Plan who retire at or after age 62 with six years of credited service, or with 30 years of service regardless of age, are entitled to a retirement benefit, payable monthly for life, equal to 1.6% for regular employees, 2% for senior management, and 3% for county elected officials for each year of credited service times their final average compensation. Final average compensation is the employee's average of the five highest fiscal years of salary earned during credited service. Vested employees may retire before age 62 and receive benefits that are reduced 5% for each year prior to normal retirement age. Employees participating in the Investment Plan are vested after one year of service with no age requirement. The System also provides death and disability benefits. Benefits are established by Chapter 121, Florida Statutes, and Chapter 22B, Florida Administrative Code. The Deferred Retirement Option Program (DROP) is a program that provides an alternative method for payment of retirement benefits for a specified and limited period for members of the System, effective July 1, 1998. Under this program, the employee may retire and have their benefits accumulate in the Florida Retirement System Trust Fund, earning interest, while continuing to work for a System employer. The participation in the program does not change conditions of employment. When the DROP period ends, maximum of 60 months, employment must be terminated. At the time of termination of employment, the employee will receive payment of the accumulated DROP benefits, and begin receiving their monthly retirement benefit (in the same amount determined at retirement, plus annual cost -of- living increases). 1011- 1210831 14 Collier County, Florida Tax Collector Notes to Special- Purpose Financial Statements (continued) 6. Employee Retirement Plan (continued) The System publishes an annual report that provides ten -year historical trend information about progress made in accumulating sufficient assets to pay benefits when due. This report may be obtained by writing to the Division of Retirement, Department of Management Services, 1317 W inewood Boulevard, Building 8, Tallahassee, Florida 32399, or by calling (850) 488 -5706, or accessing their Internet site at http: / /www.frs.state.fl.us. The Tax Collector is required to contribute an actuarially determined rate. The current rate is 18.64% for county elected officials, 14.57% for senior management, 10.77% for regular employees, and 12.251/0 for DROP employees ofcovered payroll. The contribution requirements of the Tax Collector are established and may be amended by the State of Florida. The Tax Collector's contributions to the plans for the years ended September 30, 2010, 2009, and 2008 were $661,722, $667,905 and $643,986, respectively, equal to the required contributions for each year. 7. Other Postemployment Healthcare Benefits (OPEB) Plan The County reports its obligations for OPEB pursuant to GASB Statement No. 45, Accounting and Financial Reporting by Employers fin- Postemployment Benefits Other Than Pensions. Plan Description. The Tax Collector participates in a group health care plan that covers eligible retirees, and their dependents, of the Board of County Commissioners and all Constitutional Officers with the exception of the Sheriff. The Board administers the plan and establishes the benefits. The healthcare plan does not issue a stand -alone financial report, however additional actuarial information regarding the plan as a whole is disclosed in the Notes to the financial statements ofCollier County. As required by Section 112.081, Florida Standes, retirees and their eligible dependents are provided the same health care coverage as is offered to active employees at the same premium cost (borne by the retiree) applicable to active employees. Under Florida Statutes, retirees are eligible to participate in the active medical plan by paying the active rate if they have attained age 62 and have six years of service or have at least 30 years of service. Employees eligible for a reduced benefit under the Florida Retirement System prior to age 62 are also eligible to participate in the medical plan. In addition, the Tax Collector provides a 100% subsidy for retirees between the ages of 55 and 65 with more than 10 years of service and 800 hours of accumulated sick leave to remit at the time of retirement. 1011 - 1210931 15 Collier County, Florida Tax Collector Notes to Special - Purpose Financial Statements (continued) 7. Other Postemployment Healthcare Benefits (OPEB) Plan (continued) Funding Policy. The contribution requirements of the plan members and the employers are established and may be amended by the County. The plans are financed by the participating agencies on a pay as you go basis through the County's self insurance internal service fund. The Tax Collector contributes an additional amount to the County per each active employee to accumulate resources to fund retiree health care. The Tax Collector contributed $20,231 to the group health plan during the fiscal year ended September 30, 2010. The Tax Collector's share of the County's net OPGB obligation at September 30, 2010, was $9,863, which is recorded in the basic financial statements of the County. The annual other postemployment benefit cost is calculated based on the annual required contribution of the employer (ARC), an amount actuarially determined in accordance with GASB Statement 45. The ARC represents a level of funding that, if paid on an ongoing basis, is projected to cover normal cost each year and amortize any unfunded actuarial liabilities over a period not to exceed thirty years. An actuarial valuation on the plan as a whole was performed in October 2009. The notes to the financial statements of the County disclose additional information regarding the other post employment benefit plan as a whole. 8. Related -Party Transactions During the fiscal years ended September 30, 2010 and 2009, the Board paid commissions and fees to the Tax Collector that amounted to $17,895,031 and $18,756,609, respectively. At September 30, 2010 and 2009, the Tax Collector had a payable due to the Board of County Commissioners of $8,679,644 and $9,423,794 respectively, comprised as follows: Distribution of excess commissions and fees Agency funds due to the Board 2010 2009 $ 7,935,116 $ 8,645,361 744,528 778,433 $ 8,679,644 $ 9,423,794 IDI I- 1'10831 16 Collier County, Florida Tax Collector Notes to Special- Purpose Financial Statements (continued) 9. Risk Management Collier County, Florida (the County) is exposed to various risks of loss including but not limited to general liability, health and life, property and casualty, auto and physical damage, and workers' compensation. The County is substantially self - insured and accounts for and finances its risk of uninsured losses through an internal service fund. All liabilities associated with these self- insured risks are reported in the basic financial statements of the County. The fax Collector participates in the County's self - insurance program. During the years ended September 30, 2010 and 2009, the Tax Collector was charged $2,251,828 and $1,964,654. respectively, by the County for participation in the risk management program. The County provides coverage for up to $500,000 per claim for workers' compensation, and has purchased outside excess coverage for up statutory limit for each injury or illness. The County also provides coverage for up to $100,000 per person /$200,000 per occurrence for auto and other liability claims, and has purchased outside excess coverage for up to $1,000,000 per claim. Negligence claims in excess of the statutory limits set in Section 768.20, Florida Statutes, which provide for limited sovereign immunity of $100,000 per person /$200,000 per occurrence can only be recovered through an act of the State Legislature. The County also provides coverage for up to $100,000 per person /$200,000 per occurrence for public official's errors and omissions claims and has purchased outside excess coverage for up to $5,000,000 per claim. There have been no significant reductions in insurance coverage in the last year. Settled claims have not exceeded the insurance provided by third party carriers in any of the last three years. The County is also self - insured for health claims covering all of its employees and their eligible dependents. The County retains the first $225,000 in losses per calendar year per covered member and purchases excess coverage with a maximum lifetime limit of $2,000,000. As required by Section 112.081, Florida Slatules, retirees and their eligible dependents are provided the same health care coverage as is offered to active employees at the same premium cost (borne by the retiree) applicable to active employees. An actuarial valuation is performed each year to estimate the amounts needed to pay prior and future claims and to establish reserves. 1011 - 1210 931 17 Collier County, Florida Tax Collector Notes to Special - Purpose Financial Statements (continued) 10. Commitments and Contingencies Leases The Tax Collector has noncance lab le operating leases for certain office facilities that were utilized solely by the Tax Collector for fiscal year 2010. The following is a schedule of future minimum lease payments under the operating leases: Fiscal year ending September 30 2011 $ 266,706 2012 132,928 2013 137,902 2014 77,892 2015 26,652 Rental expense for all operating leases aggregated $325,766 and $316,318 for the years ended September 30, 2010 and 2009, respectively. There were no contingent rentals or sublease rentals associated with leases in effect at September 30, 2010 or 2009. Litigation The Tax Collector is involved as a defendant or plaintiff in certain litigation and claims arising from the ordinary course of operations. In the opinion of the Tax Collector and legal counsel, the range of potential recoveries or liabilities will not materially affect the financial position of the Tax Collector. 1011 - 1210831 18 II (I JERNST &YOUNG Ernst & Young LLP �1,,1y,ssuuo Report of Independent Certified Public Accountants on Internal Control Over Financial Reporting and on Compliance and Other Matters Based on an Audit of Special- Purpose Financial Statements Performed in Accordance with Government Auditing Standards Honorable Larry H. Ray, Tax Collector Collier County, Florida We have audited the special - purpose financial statements of the general fund and the aggregate remaining fund information of the Collier County, Florida Tax Collector (the Tax Collector) as of and for the years ended September 30, 2010 and 2009, and have issued our report thereon dated December 9, 2010, which describes that such special - purpose financial statements have been prepared for the purpose of complying with Section 218.39, Florida Statutes, and Chapter 10.577(3), Rules of the Auditor General for Local Governmental Entity Audits. We conducted our audit in accordance with auditing standards generally accepted in the United States and the standards applicable to financial audits contained in Government Auditing Standards, issued by the Comptroller General of the United States. Internal Control Over Financial Reporting In planning and performing our audit, we considered the Tax Collector's internal control over financial reporting as a basis for designing our auditing procedures for the purpose of expressing our opinion on the special - purpose financial statements, but not for the purpose of expressing an opinion on the effectiveness of the Tax Collector's internal control over financial reporting. Accordingly, we do not express an opinion on the effectiveness of the Tax Collector's internal control over financial reporting. A deficiency in internal control exists when the design or operation of a control does not allow management or employees, in the normal course of performing their assigned functions, to prevent or detect misstatements on a timely basis. A material weakness is a deficiency, or combination of deficiencies, in internal control such that there is a reasonable possibility that a material misstatement of the entity's financial statements will not be prevented, or detected and corrected on a timely basis. Our consideration of internal control over financial reporting was for the limited purpose described in the first paragraph of this section and was not designed to identify all deficiencies in internal control that might be deficiencies, significant deficiencies or material weaknesses. We did not identify any deficiencies in internal control over financial reporting that we consider to be material weaknesses, as defined above. 1011 - 1210831 19 Illll ��Illllllliii�" JERNST &YOUNG Compliance and Other Matters As part of obtaining reasonable assurance about whether the Tax Collector's special - purpose financial statements are free of material misstatement, we performed tests of its compliance with certain provisions of laws, regulations, contracts, and grant agreements, noncompliance with which could have a direct and material effect on the determination of special - purpose financial statement amounts. However, providing an opinion on compliance with those provisions was not an objective of our audit and, accordingly, we do not express such an opinion. The results of our tests disclosed no instances of noncompliance or other matters that are required to be reported under Government Auditing Standards. This report is intended solely for the information and use ofthe Tax Collector, management, others within the entity, the Board of County Commissioners of Collier County, Florida and the Auditor General of the State of Florida, and is not intended to be and should not be used by anyone other than these specified parties. i tir f G "7 UP December 9, 2010 1011- 1210 %31 20 II�IIIIIII��ii��l� JERNST &YOUNG Ernst &YaungLLP L.�u Ra:rn ilgi rta 35a8� Ir I_ � � Stil Sb':, EI000 Management Letter Honorable Larry H. Ray, Tax Collector Collier County, Florida We have audited the special - purpose financial statements of the general fund and the aggregate remaining fund information of the Collier County, Florida Tax Collector (the Tax Collector) as of and for the year ended September 30, 2010, and have issued our report thereon dated December 9, 2010. We conducted our audit in accordance with auditing standards generally accepted in the United States and the standards applicable to financial audits contained in Government Auditing Standards, issued by the Comptroller General of the United States. Additionally, our audit was conducted in accordance with the provisions of Chapter 10.550, Rules of the Auditor General, which govern the conduct of local governmental audits performed in the state of Florida and require that certain items be addressed in this letter. We have also issued our report dated December 9, 2010, on internal control over financial reporting and on compliance and other matters based on an audit of special - purpose financial statements performed in accordance with Government Auditing Standards. Disclosures in that report should be considered in conjunction with this management letter. We have the following suggestions for improvement in accounting procedures and controls. Current Year Findings and Recommendations There were no findings or recommendations as a result of our current year audit. Prior Year Findings and Recommendations There were no findings or recommendations made in the prior year financial audit. Other Required Communications No matters of noncompliance with Section 218.415, Florida Statutes, regarding the investment of public funds were identified within the scope of our audit. The results of our audit disclosed no violations of laws, rules, regulations orcontractual provisions or abuse, no improper or illegal expenditures, and no control deficiencies. 1011- LIOft31 21 J ERNST & YOUNG The Tax Collector was established by the Constitution of the State of Florida, Article VIII, Section I (d). This management letter is intended solely for the information and use of the Tax Collector, management, the Board of County Commissioners of Collier County, Florida, and the Auditor General of the State of Florida, and is not intended to be and should not be used by anyone other than these specified parties. �'D w f "7 UP December 9, 2010 1011 - 1'10831 22 Frmi & Vouny I I P Assurance I Tax I Transactions I Advisory About Ernst & Young t in in�lo h.l b,idri �11 r nnri'ru, "l,� r�.4, dlPi��,..� g,, -,II 'I Din e it II 111 1 ll L — L io,!.h ,r:u,lI� jo ;,, I n i i nbr� In 11i -1 I_iro.l -. iol 'f( "bel Wnl nI!,. ;I,ol I.n W, tl I' niy., , THIS PAGE INTENTIONALLY LEFT BLANK tl J. wW A ,