FY2010 Audit Report City
City of Blair, Nebraska
FINANCIAL STATEMENTS
AND INDEPENDENT AUDITOR’S REPORT
For the year ended September 30, 2010
TABLE OF CONTENTS
Page
INDEPENDENT AUDITOR’S REPORT 3 - 4
MANAGEMENT’S DISCUSSION AND ANALYSIS 5 - 17
BASIC FINANCIAL STATEMENTS
Statement of net assets - Government-wide 18
Statement of activities - Government-wide 19
Balance sheet - Governmental funds 20
Reconciliation of the balance sheet of the governmental funds
to the statement of net assets 21
Statement of revenues, expenditures, and changes in
fund balances - Governmental funds 22
Reconciliation of the statement of revenues, expenditures
and changes in fund balances of the governmental funds
to the statement of activities 23
Statement of net assets - Proprietary funds 24
Statement of revenues, expenses, and changes in
fund net assets - Proprietary funds 25
Statement of cash flows - Proprietary funds 26
Statement of net assets - Fiduciary funds 27
NOTES TO FINANCIAL STATEMENTS 28 - 46
SUPPLEMENTAL INFORMATION
Budgetary comparison schedule - General fund and major special revenue funds 48
Budgetary comparison schedule - General fund revenues 49
Budgetary comparison schedule - Street fund 50
Budgetary comparison schedule - KENO fund 51
TABLE OF CONTENTS – CONTINUED
Page
INDEPENDENT AUDITOR’S REPORT ON INTERNAL CONTROL
OVER FINANCIAL REPORTING AND ON COMPLIANCE AND
OTHER MATTERS BASED ON AN AUDIT OF FINANCIAL
STATEMENTS PERFORMED IN ACCORDANCE WITH GOVERNMENT
AUDITING STANDARDS 52 - 53
SCHEDULE OF FINDINGS AND RESPONSES 54 - 55
SUMMARY SCHEDULE OF PRIOR AUDIT FINDINGS 56
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City of Blair, Nebraska
MANAGEMENT’S DISCUSSION AND ANALYSIS
September 30, 2010
The discussion and analysis of the City of Blair’s financial performance provides an overview
and analysis of the City’s financial activities for the fiscal year ended September 30, 2010. It
should be read in conjunction with the accompanying basic financial statements.
FINANCIAL HIGHLIGHTS
The assets of the City of Blair exceeded its liabilities at the close of the fiscal year
ending September 30, 2010 by $27.0 million (net assets). Of this amount, $4.6 million
(unrestricted net assets) may be used to meet the government’s ongoing obligations to
citizens and creditors.
The City of Blair’s total net assets increased by $2.5 million for the year ended
September 30, 2010. The increase in net assets of $2.5 million can be attributed to
grants, water revenue, and sales tax revenue used to purchase capital assets.
As of September 30, 2010, the City of Blair’s governmental funds reported combined
ending fund balances of $4.1 million, an increase of $1 million in comparison with the
prior fiscal year. This increase is attributed in part to the completion of capital projects
funded by sales tax.
The fund balances for the General Fund did not significantly change for the fiscal year
ended September 30, 2010. The Debt Service Fund increased $900,000 and the Street
Fund increased $85,000 during the same period.
The City’s total debt decreased by $200,000 during the current fiscal year. The City
issued new debt during the current year and continued to make annual debt payments.
OVERVIEW OF FINANCIAL STATEMENTS
The discussion and analysis serves as an introduction to the City of Blair’s basic financial
statements. The City of Blair’s basic financial statements are comprised of three components,
government-wide financial statements, fund financial statements, and notes to the financial
statements. This report also contains other supplementary information in addition to the basic
financial statements themselves.
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City of Blair, Nebraska
MANAGEMENT’S DISCUSSION AND ANALYSIS - CONTINUED
September 30, 2010
Government-wide financial statements. The government-wide financial statements are
designed to provide readers with a broad overview of the City of Blair’s finances in a manner
similar to a private-sector business. The statement of net assets presents information on all of
the City of Blair’s assets and liabilities, with the difference between the two reported as net
assets. Over time, increases or decrease in net assets may serve as a useful indicator of whether
the financial position of the City of Blair is improving or deteriorating. The statement of net
assets combines and consolidates governmental funds’ current financial resources (short-term
spendable resources with capital assets and long-term obligations. Other nonfinancial factors
should also be taken into consideration, such as changes in the City’s property tax base and the
condition of the City’s infrastructure (i.e. roads, drainage improvements, storm and sewer lines,
etc.), to assess the overall health or financial condition of the City. The statement of activities
presents information showing how expenses are taken into account regardless of when cash is
received or paid. Thus, revenues and expenses are reported in this statement for some items that
will only result in cash flows in future fiscal periods (e.g., uncollected taxes). Both the statement
of net assets and the statement of activities are prepared utilizing the accrual basis of accounting
as opposed to the modified accrual basis.
In the statement of net assets and the statement of activities, the City is divided into two kinds of
activities:
Governmental Activities - Most of the City’s basic services are reported here, including
the police, streets, fire, library, planning and development, parks and recreation, and
general administration. Property taxes, sales taxes, and state allocations finance most of
these activities.
Business type Activities - The City charges a fee to customers to help it cover all or
most of the cost of certain services it provides. The City’s water and sewer system are
reported here.
Fiduciary Activities - The City accounts for Agency Funds for TIF District #1 Project
which are held in restriction to pay the costs of the District. TIF District #1 bonds are
held by the developer and do not carry the full faith and credit of the City.
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City of Blair, Nebraska
MANAGEMENT’S DISCUSSION AND ANALYSIS - CONTINUED
September 30, 2010
Reporting the City’s Most Significant Funds
Fund Financial Statements
A fund is a grouping of related accounts that is used to maintain control over resources that have
been segregated for specific activities or objectives. Some funds are required to be established
by state laws and by bond covenants. However, the City also establishes many other funds to
help it control and manage money for particular purposes or to show that it is meeting legal
responsibilities for using certain taxes, grant and other money. The City’s three kinds of fund
financial statements – governmental, proprietary and fiduciary - utilize different accounting
approaches.
Governmental funds - The majority of the City’s basic services are reported in
governmental funds, which focus on how money flows into and out of those funds and
the balances left at year-end that are available for spending. These funds are reported
using an accounting method identified as the modified accrual basis of accounting,
which measures cash and all other financial assets that can readily be converted into
cash. The governmental fund statements provide a detailed short-term view of the City’s
general governmental operations and the basic services it provides. Governmental fund
information helps determine whether there are more or fewer financial resources that can
be spent in the near future to finance the City’s programs. By comparing information
presented for governmental funds with similar information presented for governmental
activities in the government-wide statements, readers may better understand the long-
term effect of the government’s near term financing decisions. The relationships of
differences between governmental activities (reported in the statement of net assets and
the statement of activities) and governmental funds are detailed in a reconciliation
following the fund financial statements.
The City of Blair maintains five individual governmental funds. Information is presented
separately in the governmental funds balance sheet and in the governmental funds
statement of revenues, expenditures, and changes in fund balances for the general fund,
debt service fund, street fund, keno fund and capital projects fund, all of which are
considered to be major funds.
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City of Blair, Nebraska
MANAGEMENT’S DISCUSSION AND ANALYSIS - CONTINUED
September 30, 2010
Fund Financial Statements - Continued
Proprietary funds - The City charges customers for the services it provides, whether to
outside customers or to other units within the City. These services are generally reported
in proprietary funds. Proprietary funds are reported in the same way that all activities are
reported in the statement of net assets and the statement of activities. In fact, the City’s
enterprise funds (a component of proprietary funds) are identical to the business-type
activities that are reported in the government-wide statements but provide more detail
and additional information, such as cash flows, for proprietary funds.
The City of Blair maintains two individual enterprise funds. The City uses enterprise
funds to account for its water and sewer. The funds provide the same type of information
as the government-wide financial statements, only in more detail and include some of
the internal service fund type activity. The proprietary fund financial statements provide
separate information for the water and sewer funds, both of which are considered to be
major funds in the City.
Fiduciary fund - The City accounts for Agency Funds for TIF District #1 Project which
are held in restriction to pay the costs of the District. TIF District #1 bonds are held by
the developer and do not carry the full faith and credit of the City.
Notes to Financial Statements
The notes provide additional information that is essential to a full understanding of the data
provided in the government-wide and fund financial statements. The notes to the financial
statements can be found immediately following the basic financial statements.
THE CITY AS A WHOLE - Government-Wide Financial Analysis
The City’s combined net assets were $27.0 million as of September 30, 2010. Analyzing the net
assets and net expenses of governmental and business-type activities separately, the
governmental activities net assets were $14.3 million and the business type activities net assets
were $12.7 million. This analysis focuses on the net assets (table 1) and changes in general
revenues (table 2) and significant expenses of the City’s governmental and business-type
activities. The comparative government-wide results are provided in the tables for additional
analysis.
By far the largest portion of the City’s net assets (83%) reflects its restricted capital assets (e.g.,
donations, community betterment, debt service, and capital projects).
SEE TABLE 1
2010 2009 2010 2009 2010 2009
ASSETS
Current and other assets 8,027$ 7,464$ 2,736$ 1,870$ 10,763$ 9,334$ Capital assets 16,771 14,525 34,797 35,825 51,568 50,350 Total assets 24,798 21,989 37,533 37,695 62,331 59,684
LIABILITIES
Long-term debt outstanding 6,195 5,515 22,473 22,711 28,668 28,226
Other liabilities 4,341 4,638 2,343 2,384 6,684 7,022
Total liabilities 10,536 10,153 24,816 25,095 35,352 35,248
NET ASSETS Invested in capital assets net of related debt 9,986 8,520 11,125 11,944 21,111 20,464
Restricted 221 251 1,080 267 1,301 518
Unrestricted (deficit)4,055 3,065 512 389 4,567 3,454
Total net assets 14,262$ 11,836$ 12,717$ 12,600$ 26,979$ 24,436$
City of Blair, NebraskaMANAGEMENT'S DISCUSSION AND ANALYSIS - CONTINUEDSUMMARY OF NET ASSETS
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Governmental Activities Business-type Activities Total Primary Government
TABLE 1
Amounts expressed in thousands
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City of Blair, Nebraska
MANAGEMENT’S DISCUSSION AND ANALYSIS - CONTINUED
September 30, 2010
Governmental activities: Governmental activities increased the City’s net assets by $2.4
million.
Key elements of this increase are as follows:
The increase was in part due to the fact that all revenue from taxes in governmental
funding activities was fairly stable. The General Fund and Street Fund were the most
effective at covering their costs due to sales tax, fees charged, operating grants, capital
grants, and contributions, which was generally a positive increase.
Other revenues accounted for an increase of $1.5 million. These revenues consist of
reimbursements, developers’ down payments, other donations, and miscellaneous
revenues.
The comparative financial analysis is provided for additional information. The City’s
governmental revenues increased when compared to the prior year by 22% or $1.6 million. The
primary reason for this increase was the receipt of other funds such as grants and building fees.
The assessed value of the property of the City increased by $9.25 million or 2.1% as compared
to the prior year while the City property tax rate of $.3569 per $100 assessed valuation stayed
the same.
Business-type Activities
Revenues of the City’s business-type activities were $6.5 million for the fiscal year ending
September 30, 2010. Expenses for the City’s business-type activities were $6.1 million for the
year, resulting in net revenues of $367,000. The net revenues are the result of several factors,
including the following:
The City’s water system recorded charges for services of $5.47 million, which exceeded
expenses of $4 million, which included $1.08 million in depreciation, by $1.44 million.
The most significant expenses of the water fund were $957,000 for operating expenses,
$770,000 for salaries and benefits and $1,220,000 for material and supplies.
The sewer fund had a net operating income of $204,982 before depreciation.
SEE TABLE 2
2010 2009 2010 2009 2010 2009REVENUES
Program revenues
Charges for services 601$ 472$ 6,482$ 6,537$ 7,083$ 7,009$
Operating grants and contributions 62 86 - - 62 86 Capital grants and contributions 460 333 - - 460 333
General revenues
Taxes 4,484 4,580 - - 4,484 4,580
Interest income 159 187 4 10 163 197 Other 2,120 606 - - 2,120 606 Total revenues 7,886 6,264 6,486 6,547 14,372 12,811
EXPENSES
Administration 771 687 - - 771 687
Police 1,687 1,699 - - 1,687 1,699 Fire 363 279 - - 363 279 Parks 470 506 - - 470 506 Library 285 277 - - 285 277
Swimming pool 66 54 - - 66 54
Zoning 157 138 - - 157 138
Animal control 91 82 - - 91 82 Donated fund 23 20 - - 23 20 Streets 1,459 1,645 - - 1,459 1,645 Keno 24 46 - - 24 46
Bond issuance costs 18 - - - 18 -
Interest expense 295 282 - - 295 282
Water - - 5,010 4,934 5,010 4,934 Sewer - - 1,109 944 1,109 944 Total expenses 5,709 5,715 6,119 5,878 11,828 11,593
CHANGE IN NET ASSETS
BEFORE TRANSFERS 2,177 549 367 669 2,544 1,218
TRANSFERS 249 (362) (249) 362 - - CHANGE IN NET ASSETS 2,426 187 118 1,031 2,544 1,218
NET ASSETS,
BEGINNING OF YEAR 11,836 11,149 12,599 12,068 24,435 23,217
PRIOR PERIOD ADJUSTMENT - 500 - (500) - - BEGINNING NET ASSETS, RESTATED 11,836 11,649 12,599 11,568 24,435 23,217
NET ASSETS, END OF YEAR 14,262$ 11,836$ 12,717$ 12,599$ 26,979$ 24,435$
City of Blair, Nebraska
MANAGEMENT'S DISCUSSION AND ANALYSIS - CONTINUED
CHANAGES IN NET ASSETS
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TABLE 2
Amounts expressed in thousands
Governmental Activities Business-type Activities Total Primary Government
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City of Blair, Nebraska
MANAGEMENT’S DISCUSSION AND ANALYSIS - CONTINUED
September 30, 2010
CAPITAL ASSET AND DEBT ADMINISTRATION
Capital Assets
At the end of the fiscal year 2010, the City had nearly $72.7 million invested in a broad range of
capital assets, including police and fire equipment, buildings, park facilities, and water and
sewer plants. (See Table 3) This amount represents a net increase (including increases and
decreases) of $3.1 million or 4.4% over the prior fiscal year. Beginning October 1, 2003, the
City began capitalizing general infrastructure assets and depreciating them over their useful
lives as required by GASB 34. The general infrastructure assets capitalized in 2010 were $3.2
million.
SEE TABLE 3
Balance BalanceSeptember 30, 2009 Increases Decreases September 30, 2010
GOVERNMENTAL ACTIVITIESLand 206$ -$ -$ 206$
Street infrastructure 10,032 2,473 - 12,505
Buildings 5,659 44 - 5,703
Equipment 3,721 396 (86) 4,031
Total governmental 19,618 2,913 (86) 22,445
BUSINESS-TYPE ACTIVITIES
Water assets 41,614 234 - 41,848 Sewer assets 8,356 37 (19) 8,374
Total business-type 49,970 271 (19) 50,222
Totals 69,588$ 3,184$ (105)$ 72,667$
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City of Blair, Nebraska
MANAGEMENT'S DISCUSSION AND ANALYSIS - CONTINUED
CHANGES IN CAPITAL ASSETS
Amounts expressed in thousands
TABLE 3
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City of Blair, Nebraska
MANAGEMENT’S DISCUSSION AND ANALYSIS - CONTINUED
September 30, 2010
Debt
At year-end, the City had $7.68 million in General Obligation Bonds and General Registered
Warrants outstanding as compared to $7.68 million at the end of the prior fiscal year, resulting
in no change as shown in Table 4. The Water Revenue Bonds outstanding were decreased by
$339,000. The City has a 25 year take or pay contract with Cargill to secure the debt. The
expanded plant has a 17 million gallons per day (MPD) capacity with 12.5 MPD contracted to
Cargill and was designed to be easily expanded to 20 million gallon per day.
SEE TABLE 4
Balance Balance
September 30, September 30,
2009 Additions Reductions 2010
General Registered Warrants 1,677$ 379$ (1,156)$ 900$
General Obligation Bonds 6,005 1,270 (490) 6,785
Water Revenue Bonds 21,741 7,270 (7,609) 21,402
Sewer Revenue Bonds 2,140 1,645 (1,515) 2,270
Totals 31,563$ 10,564$ (10,770)$ 31,357$
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City of Blair, Nebraska
MANAGEMENT'S DISCUSSION AND ANALYSIS - CONTINUED
CHANGES IN OUTSTANDING DEBT
Amounts expressed in thousands
Description
TABLE 4
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City of Blair, Nebraska
MANAGEMENT’S DISCUSSION AND ANALYSIS - CONTINUED
September 30, 2010
THE CITY’S FUND
At the close of the City’s fiscal year on September 30, 2010, the governmental funds of the City
reported a combined fund balance of $4.1 million. The primary reason for the general fund’s
reduction is the transfer of cash to other funds for the purchase of capital improvements.
General Fund Budgetary Highlights
General Fund had revenues over expenditures of $572,000. This was primarily accomplished
from the fact expenses were below budgeted projections.
Debt Service had expenditures of $176,000 more than revenues. This was primarily result of
special assessments, including interest, were less than what had been budgeted.
Street Fund had an operating loss of $1,044,000. This was offset with the transfer in of
$1,916,000 in sales taxes for capital projects.
Keno and Capital Projects Fund had no major deviations in revenues or expenditures.
Water and Sewer Funds had no major deviation of revenues or expenditures. Water finished the
year with a 1.25 ratio of operating income before depreciation, plus interest income and
operating transfers in divided by Debt Service. Sewer had a net operating income to debt ratio of
1.44.
Internal Service Fund had a fund balance of $357,000. The fund was created to manage the
city’s partially self-funded employee health insurance program. The balance reflects positive
management of the fund and savings over the previous commercial employee health plan. The
fund balance represents a snapshot of the fund on Sept. 30, 2010 and does not include any
accrued liabilities or refunds receivable from reinsurance. It does show the success the City has
had in helping manage the City’s employee health care costs the past four and three quarter
years. The health care program and contracts operate on a calendar year bases. For the first five
years of the insurance program, it is estimated the City will have over $350,000 in cash savings
reserves above the expected medical costs to help hold down future premium costs.
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City of Blair, Nebraska
MANAGEMENT’S DISCUSSION AND ANALYSIS - CONTINUED
September 30, 2010
ECONOMIC FACTORS AND NEXT YEAR’S BUDGETS AND RATES
Current economic conditions point toward a continued growth in the community that will allow
for a stable budget environment. The City did take a slight hit to the community with the closing
of Dana College in June of 2010. Despite the College closing, the City’s sales tax has remained
stable. It appears that the industrial growth of the Bio industries on the Cargill Bio Campus is
providing a solid base for maintaining and growing the City’s tax base. In addition to the
industrial development, Walmart broke ground for a new 100,000 square foot super center in
October of 2010 which should allow for the continued growth to the sales tax base. The City,
Blair Area Chamber of Commerce, and Gateway Development Corporation all continue to work
to help find a prospective buyer for the Dana College property to make the facility an asset to
the City.
The property tax request for fiscal year 2010/2011 was increased by less than 1%, which with
the valuation increase caused the levy per valuation dollar to decrease over the prior year.
The City’s property valuation continues to grow at a 1.75% to 2% annual increase and sales
taxes continue to be stable. The City’s short term (1-5 years) forecast continues to be solid as
the City budgets only $915,000 annually of the estimated $1.6 million in sales tax receipts for
ear-marked projects such as property tax relief, fire bond payment and economic development.
The balance of the sales tax dollars is currently available for discretionary capital projects and
equipment that are important to the citizens of the City. The 6 to 10 year projections also appear
to remain solid with exception that the City currently uses the $481,000 annual payment from
OPPD, from the sale of the City’s electric system in 1984, for property tax relief. This $481,000
asset will go away in 2014. The Council, in annual discussion on the issue at budget preparation
time, is intent on expanding the City’s economic growth in sales and property tax base through
economic development to offset the loss of revenue from the OPPD payment in FY 2015. In
addition, the City’s current sales tax authorization is scheduled to expire on Sept. 30, 2015. The
extension of the sales tax beyond 2015 will be imperative to maintaining a reasonable property
tax levy.
CONTACTING THE CITY’S FINANCIAL MANAGEMENT
This financial report is designed to provide our citizens, taxpayers, customers, and investors and
creditors with a general overview of the City’s finances and to show the City’s accountability
for the money it receives. If you have questions about this report or need additional financial
information, contact the City of Blair, 218 S. 16th Street, Blair, NE 68008.
Governmental Business-type
Activities Activities Total
ASSETS
Cash and cash equivalents 2,645,874$ 356,760$ 3,002,634$
Accounts receivable 287,416 1,089,318 1,376,734
Due from County Treasurer 123,946 - 123,946
Accrued interest receivable 70,243 2,130 72,373
Prepaid expense - 6,862 6,862
Special assessments receivable 2,868,310 - 2,868,310
Interfund balances (77,168) 77,168 -
Contract receivable 1,560,947 - 1,560,947
Restricted cash and cash equivalents 547,576 1,080,173 1,627,749
Bond issue costs - deferred - 123,266 123,266
Capital assets
Land 206,241 423,783 630,024
Street infrastructure 12,505,089 - 12,505,089
Buildings 5,703,022 47,634,141 53,337,163
Equipment 4,030,902 2,163,926 6,194,828
Accumulated depreciation (5,674,263) (15,424,945) (21,099,208)
Total capital assets 16,770,991 34,796,905 51,567,896
Total assets 24,798,135$ 37,532,582$ 62,330,717$
LIABILITIES
Accounts payable 159,723$ 237,361$ 397,084$
Accrued expenses 245,437 162,490 407,927
Accrued interest 60,914 242,430 303,344
Deposits payable 36,350 1,700 38,050
Registered warrants 400,000 500,000 900,000
Deferred revenue 2,848,462 - 2,848,462
Bonds payable
Due within one year 590,000 1,199,438 1,789,438
Due in more than one year 6,195,000 22,472,596 28,667,596
Total liabilities 10,535,886 24,816,015 35,351,901
NET ASSETS
Investment in capital assets,
net of related debt 9,985,991 11,124,871 21,110,862
Restricted:
Donated projects 41,934 - 41,934
Debt service - 1,080,173 1,080,173
Community betterment 110,072 - 110,072
Capital projects 68,792 - 68,792
Unrestricted 4,055,460 511,523 4,566,983
Total net assets 14,262,249 12,716,567 26,978,816
Total liabilities and net assets 24,798,135$ 37,532,582$ 62,330,717$
City of Blair, Nebraska
STATEMENT OF NET ASSETS
September 30, 2010
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See accompanying notes and independent auditor's report.
GOVERNMENT - WIDE
Operating Capital Charges for Grants and Grants and Governmental Business-type
Expenses Services Contributions Contributions Activities Activities TotalFUNCTIONS/PROGRAMS
Governmental activities
Administration 771,006$ 314,226$ -$ 459,529$ 2,749$ -$ 2,749$ Police 1,687,305 17,505 15,080 - (1,654,720) - (1,654,720)
Fire 363,079 139,794 - - (223,285) - (223,285) Parks 470,163 34,309 - - (435,854) - (435,854)
Library 284,630 14,929 3,349 - (266,352) - (266,352)
Swimming pool 65,687 - - - (65,687) - (65,687) Zoning 156,805 - - - (156,805) - (156,805)
Animal control 90,995 - - - (90,995) - (90,995) Donated funds 22,674 - 43,711 - 21,037 - 21,037
Streets 1,459,352 - - - (1,459,352) - (1,459,352)
Keno 24,352 79,953 - - 55,601 - 55,601 Bond issuance costs 17,780 - - - (17,780) - (17,780)
Interest on long-term debt 294,736 - - - (294,736) - (294,736) Total governmental activities 5,708,564 600,716 62,140 459,529 (4,586,179) - (4,586,179)
Business-type activities
Water 5,010,512 5,472,870 - - - 462,358 462,358 Sewer 1,108,749 1,007,869 - - - (100,880) (100,880)
Total business-type activities 6,119,261 6,480,739 - - - 361,478 361,478
Total primary government 11,827,825$ 7,081,455$ 62,140$ 459,529$ (4,586,179) 361,478 (4,224,701)
General revenues
Taxes Property taxes 1,703,497 - 1,703,497
Sales tax 1,707,929 - 1,707,929 Occupation and franchise taxes 250,923 - 250,923
Highway allocation 525,859 - 525,859
Other taxes 295,752 - 295,752 Unrestricted investment earnings 159,057 3,969 163,026
Other income 2,119,897 - 2,119,897 Transfers 248,835 (248,835) -
Total general revenues and transfers 7,011,749 (244,866) 6,766,883
Changes in net assets 2,425,570 116,612 2,542,182
Net assets, beginning of year 11,836,679 12,599,955 24,436,634
Net assets, end of year 14,262,249$ 12,716,567$ 26,978,816$
See accompanying notes and independent auditor's report.
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Changes in Net AssetsNet (Expenses) Revenue and
City of Blair, Nebraska
STATEMENT OF ACTIVITIES
For the year ended September 30, 2010
Program Revenues
GOVERNMENT-WIDE
Capital General Debt Service Street Keno Projects
Fund Fund Fund Fund Fund Total
ASSETSCash and cash equivalents 2,151,646$ -$ 136,727$ -$ -$ 2,288,373$
ReceivablesSpecial assessments 405 2,867,905 - - - 2,868,310
Accrued interest 70,243 - - - - 70,243
Other 284,094 - - 3,322 - 287,416 Due from County Treasurer 95,727 3,038 25,181 - - 123,946
Due from other funds 12,000 - - - - 12,000 Restricted cash and cash equivalents 41,934 314,128 - 122,722 68,792 547,576
Contract receivable - OPPD 1,560,947 - - - - 1,560,947
Total assets 4,216,996$ 3,185,071$ 161,908$ 126,044$ 68,792$ 7,758,811$
LIABILITIESAccounts payable 84,589$ -$ 71,162$ 3,972$ -$ 159,723$
Accrued expenses 59,236 17,055 11,760 - - 88,051
Due to other funds - - - 12,000 12,000 Deposits payable 36,350 - - - - 36,350
Registered warrants - 400,000 - - - 400,000 Deferred revenues 49,291 2,849,612 15,300 - - 2,914,203
Total liabilities 229,466 3,266,667 98,222 15,972 - 3,610,327
FUND BALANCES
Reserved for:Donated funds 41,934 - - - - 41,934
Community betterment - - - 110,072 - 110,072
Capital projects - - - - 68,792 68,792 Unreserved
General funds 3,945,596 (81,596) - - - 3,864,000 Special revenue funds (deficit)- - 63,686 - - 63,686
Total fund balances 3,987,530 (81,596) 63,686 110,072 68,792 4,148,484
Total liabilities and fund balances 4,216,996$ 3,185,071$ 161,908$ 126,044$ 68,792$ 7,758,811$
City of Blair, Nebraska
GOVERNMENTAL FUNDSBALANCE SHEET
September 30, 2010
See accompanying notes and independent auditor's report.
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Fund balances of governmental funds 4,148,484$
Amounts reported for governmental activities in the statement of
net assets are different because
Capital assets, net of depreciation, are not current financial
resources and are not included in the governmental funds. 16,770,991
Bonds payable are not a current financial resource. Therefore,
they are not included in the governmental funds.(6,785,000)
Internal service funds are used by management to charge the
costs of insurance to individual funds. The assets and
liabilities of internal service funds are included in
governmental activities in the statement of net assets. 280,333
Taxes receivable that are not available to pay for current period
expenditures are recorded as deferred revenues in the governmental funds. 65,741
Accrued interest does not require current financial resources and
therefore is not reported in the funds.(43,859)
Accrued compensated absences are not due and payable in the
current period and therefore are not reported in the funds.(174,441)
Net assets of governmental activities 14,262,249$
See accompanying notes and independent auditor's report.
- 21 -
City of Blair, Nebraska
GOVERNMENTAL FUNDS
RECONCILIATION OF THE BALANCE SHEET OF GOVERNMENTAL FUNDS
September 30, 2010
TO THE STATEMENT OF NET ASSETS
Capital
General Debt Service Street Keno Projects
Fund Fund Fund Fund Fund Total
REVENUESTaxes 3,453,862$ 48,110$ 902,024$ -$ 71,617$ 4,475,613$
Keno proceeds - - - 79,953 - 79,953 Charges for services 469,715 - - - - 469,715
Special assessment - 297,013 - - - 297,013
Special assessment interest - 88,894 - - - 88,894 Interest income 158,279 875 23 123 243 159,543
Other revenues 357,105 102,451 65,070 - - 524,626 Total revenues 4,438,961 537,343 967,117 80,076 71,860 6,095,357
EXPENDITURES
Administration 704,770 2,006 - - 714 707,490 Police Department 1,665,439 - - - - 1,665,439
Fire Department 295,471 - - - - 295,471 Parks Department 457,190 - - - - 457,190
Library 293,381 - - - - 293,381
Swimming Pool 55,100 - - - - 55,100 Zoning 289,066 - - - - 289,066
Animal control 83,320 - - - - 83,320 Donated funds 22,674 - - - - 22,674
Keno expense - - - 17,352 - 17,352
Community betterment - - - 7,000 - 7,000 Street expense - - 2,011,808 - - 2,011,808
Debt servicePrinciple - 450,000 - - 40,000 490,000
Interest - 243,823 - - 50,875 294,698
Issuance cost - 17,780 - - - 17,780
Total expenditures 3,866,411 713,609 2,011,808 24,352 91,589 6,707,769
EXCESS (DEFICIENCY) OF REVENUESOVER EXPENDITURES 572,550 (176,266) (1,044,691) 55,724 (19,729) (612,412)
OTHER FINANCING SOURCES (USES)Bond proceeds - 1,270,000 - - - 1,270,000 Operating transfers - in 1,686,749 1,386,363 1,916,817 - - 4,989,929 Operating transfers - out (2,258,301) (1,575,638) (786,775) (75,000) - (4,695,714) Total other financing sources (571,552) 1,080,725 1,130,042 (75,000) - 1,564,215
NET CHANGE IN FUND BALANCES 998 904,459 85,351 (19,276) (19,729) 951,803
FUND BALANCES, BEGINNING OF YEAR 3,986,532 (986,055) (21,665) 129,348 88,521 3,196,681
FUND BALANCES, END OF YEAR 3,987,530$ (81,596)$ 63,686$ 110,072$ 68,792$ 4,148,484$
City of Blair, Nebraska
STATEMENT OF REVENUES, EXPENDITURES, AND CHANGES IN FUND BALANCE - GOVERNMENTAL FUNDS
For the year ended September 30, 2010
See accompanying notes and independent auditor's report.
- 22 -
Net changes in fund balance - total governmental funds 951,803$
Amounts reported for governmental activities in the statement of activities
differ from the amounts reported in the statement of revenues,
expenditures, and changes in fund balances because:
Governmental funds report capital outlays as expenditures. However,
in the statement of activities, the costs of those assets are allocated over
their estimated useful lives as functional expense when the cost is above
the capitalization threshhold. The activity is reconciled as follows:
Cost of assets capitalized 1,183,693
Depreciation expense (667,765)
Bond proceeds provide current financial resources to governmental
funds, but issuing debt increases long-term liabilities in the statement
of net assets. (1,270,000)
Reypayment of bond principal is an expenditure in the govermental funds, but the rpayment reduces long-term liabilities
in the statement of net assets 490,000
Some expenses reported in the statement of activities do not require the use
of current financial resources, and therefore, are not reported as (1,062)
expenditures in governmental funds.
Revenues in the statement of activities that do not provide current
financial resources are not reported as revenue in the funds.9,109
Revenue from donated and sold assets in are not current financial resources
and are therefore not reported as revenues in govermental funds 1,729,792
Change in net assets of governmental activities 2,425,570$
See accompanying notes and independent auditor's report.
- 23 -
City of Blair, Nebraska
GOVERNMENTAL FUNDS
RECONCILIATION OF THE STATEMENT OF REVENUES, EXPENDITURES,
AND CHANGES IN FUND BALANCES OF GOVERNMENTAL FUNDS
For the year ended September 30, 2010
TO THE STATEMENT OF ACTIVITIES
Internal
Water Sewer Total Service Fund
CURRENT ASSETS
Cash -$ 356,760$ 356,760$ 357,501$
Accounts receivable user fees 931,775 157,543 1,089,318 - Accrued interest receivable 1,879 251 2,130 -
Prepaid expense 4,620 2,242 6,862 -
Total current assets 938,274 516,796 1,455,070 357,501
NON-CURRENT ASSETS
Restricted assets
Bond and interest sinking fund cash
and investments 825,673 254,500 1,080,173 -
Bond issuance costs - deferred 123,266 - 123,266 -
Total non-current assets 948,939 254,500 1,203,439 -
CAPITAL ASSETS
Land 373,908 49,875 423,783 -
Buildings 40,404,402 7,229,739 47,634,141 -
Equipment 1,069,508 1,094,418 2,163,926 -
Accumulated depreciation (11,572,648) (3,852,297) (15,424,945) -
Total capital assets 30,275,170 4,521,735 34,796,905 -
Total assets 32,162,383$ 5,293,031$ 37,455,414$ 357,501$
CURRENT LIABILITIES
Accounts payable 224,785$ 12,576$ 237,361$ -$
Accrued expenses 108,918 53,572 162,490 -
Accrued interest 227,364 15,066 242,430 -
Deposits 1,700 - 1,700 - Registered warrants 500,000 - 500,000 -
Bonds payable - current 1,134,438 65,000 1,199,438 -
Total current liabilities 2,197,205 146,214 2,343,419 -
NON-CURRENT LIABILITIES
Bonds payable 20,267,596 2,205,000 22,472,596 -
Total liabilities 22,464,801 2,351,214 24,816,015 -
NET ASSETS
Investment in capital assets net of related debt 8,873,136 2,251,735 11,124,871 -
Restricted for debt service 825,673 254,500 1,080,173 - Unrestricted (1,227) 435,582 434,355 357,501
Total net assets 9,697,582$ 2,941,817$ 12,639,399 357,501$
RECONCILIATION
Eliminating entry between business-type activities and governmental activitie 77,168
12,716,567$
City of Blair, Nebraska
STATEMENT OF NET ASSETS
PROPRIETARY FUNDS
September 30, 2010
See accompanying notes and independent auditor's report
- 24 -
ASSETS
LIABILITIES AND NET ASSETS
Enterprise Funds
Internal
Water Sewer Total Service Fund
OPERATING REVENUES
Charges for services 5,415,217$ 989,733$ 6,404,950$ 1,073,249$
Sale of merchandise 19,129 - 19,129 - Forfeited discounts 14,381 - 14,381 -
Other 24,143 18,136 42,279 -
Total operating revenues 5,472,870 1,007,869 6,480,739 1,073,249
EXPENSES
Personnel 769,420 431,026 1,200,446 -
Operating expenses 957,641 356,609 1,314,250 -
Materials and supplies 1,227,239 12,580 1,239,819 -
Rental expense 6,637 2,672 9,309 -
Insurance claims and expenses - - - 1,030,363
Depreciation 1,075,076 223,953 1,299,029 - Total expenses 4,036,013 1,026,840 5,062,853 1,030,363
OPERATING INCOME 1,436,857 (18,971) 1,417,886 42,886
NONOPERATING REVENUES (EXPENSES)
Interest income 2,192 1,777 3,969 755
Interest expense (927,947) (81,040) (1,008,987) - Bonding costs (44,920) - (44,920) - Total nonoperating revenues (expenses)(970,675) (79,263) (1,049,938) 755 Income(loss) before transfers 466,182 (98,234) 367,948 43,641
Operating transfers - in 4,183 244,266 248,449 - Operating transfers - out (214,013) (283,271) (497,284) (45,380)
CHANGE IN NET ASSETS 256,352 (137,239) 119,113 (1,739)
9,441,230 3,079,056 12,520,286 359,240
NET ASSETS, END OF YEAR 9,697,582$ 2,941,817$ 12,639,399$ 357,501$
RECONCILIATION
Change in net assets 119,113$
Change in eliminating entry between business-type activities
and governmental activities (2,501)
Change in net assets business-type activities 116,612$
- 25 -
City of Blair, Nebraska
STATEMENT OF REVENUES, EXPENSES, AND
CHANGES IN FUND NET ASSETS
PROPRIETARY FUNDS
For the year ended September 30, 2010
See accompanying notes and independent auditor's report
Enterprise Funds
NET ASSETS, BEGINNING OF YEAR
Internal Water Sewer Total Service Fund
Cash received from customers 5,446,586$ 1,012,405$ 6,458,991$ -$ Cash received from interfund services provided - - - 1,073,249 Cash payments to suppliers (2,151,515) (379,076) (2,530,591) - Cash payments to employees (779,887) (421,168) (1,201,055) - Cash paid for interfund services used - - - (1,030,363) Cash paid for judgments and claims - - - - Cash provided from operating activities 2,515,184 212,161 2,727,345 42,886
CASH FLOWS FROM NON-CAPITAL
FINANCIAL ACTIVITIES
Operating transfers - in 4,183 244,266 248,449 -
Operating transfers - out (214,013) (283,271) (497,284) (45,380)
Cash used from non-capital financing
activities (209,830) (39,005) (248,835) (45,380)
CASH FLOWS FROM CAPITAL AND RELATED
FINANCING
Acquisition of capital assets (234,075) (36,732) (270,807) -
Receipt of debt proceeds 7,270,000 1,645,000 8,915,000
Repayment of long-term debt (7,609,339) (1,515,000) (9,124,339) - Interest payment long-term debt (1,004,947) (106,327) (1,111,274) - Bonding costs (168,186) - (168,186) - Cash used from capital and relatedfinancing activities (1,746,547) (13,059) (1,759,606) -
CASH FLOWS FROM INVESTING ACTIVITIES
Proceeds from interest earnings 313 1,729 2,042 755
Disbursements from (to) restricted assets (648,673) (164,500) (813,173) -
Cash provided from investing activities (648,360) (162,771) (811,131) 755
CHANGE IN CASH AND CASH EQUIVALENTS (89,553) (2,674) (92,227) (1,739)
CASH AND CASH EQUIVALENTS,
BEGINNING OF YEAR 89,553 359,434 448,987 359,240
CASH AND CASH EQUIVALENTS,
END OF YEAR -$ 356,760$ 356,760$ 357,501$
Reconciliation of operating income to net cash from operating activitiesOperating income 1,436,857$ (18,971)$ 1,417,886$ 42,886$ Adjustments to reconcile operating incometo net cash from operating activitiesDepreciation 1,075,076 223,953 1,299,029 - Change in receivables (26,284) 4,536 (21,748) - Change in prepaid expenses 81 63 144 - Change in accounts payable 39,921 (7,278) 32,643 - Change in accrued expenses (10,467) 9,858 (609) - Total adjustments 1,078,327 231,132 1,309,459 -
CASH PROVIDED FROM OPERATING ACTIVITIES 2,515,184$ 212,161$ 2,727,345$ 42,886$
See accompanying notes and independent auditor's report.
- 26 -
City of Blair, NebraskaSTATEMENT OF CASH FLOWS
PROPRIETARY FUNDS
September 30, 2010
CASH FLOWS FROM OPERATING ACTIVITIES
Enterprise Funds
TIF
Fund 1
ASSETS
Cash 48,431$
NET ASSETS
Net Assets (Deficit) Held in Trust for Tax Incentive Funds (TIF)48,431$
City of Blair, Nebraska
STATEMENT OF NET ASSETS
September 30, 2010
See accompanying notes and independent auditor's report.
- 27 -
FIDUCIARY FUNDS
City of Blair, Nebraska
NOTES TO FINANCIAL STATEMENTS
September 30, 2010
- 28 -
NOTE A. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
The following is a summary of the significant accounting policies of the City of Blair,
Nebraska:
1. Reporting Entity
The City of Blair, Nebraska (the City) is a Municipal Corporation which was
founded and incorporated in 1869. With a population of 7,612, the City of Blair
functions as a City of the First Class under Nebraska Statutes. The City operates
under a Mayor/Council form of government and provides the following services:
public safety, streets, culture and recreation, public improvements, planning and
zoning, water and sewer services, and general administrative services. This report
includes all funds of the City (the “primary government”).
2. Basis of Accounting/Measurement Focus
The accounts of the City are organized on the basis of funds, each of which is
considered a separate accounting entity. The operations of each fund are
accounted for with a separate set of self-balancing accounts that comprise its
assets, liabilities, fund equity, revenues, and expenditures. Governmental
resources are allocated to and accounted for in individual funds based upon the
purpose for which they are to be spent and the means by which spending activities
are controlled.
Government-Wide Financial Statements
The City’s government-wide financial statements include a statement of net assets
and a statement of activities (including changes in net assets). These statements
are prepared using the standards of the Governmental Accounting Standards
Board (GASB), General Accepted Accounting Principles (GAAP), as well as
FASB pronouncements issued through November 30, 1989. These statements
present summaries of governmental and business-type activities for the City.
Fiduciary activities of the City are not included in these statements. These
statements are presented on an “economic resources” measurement focus and the
accrual basis of accounting.
City of Blair, Nebraska
NOTES TO FINANCIAL STATEMENTS - CONTINUED
September 30, 2010
- 29 -
NOTE A. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - CONTINUED
2. Basis of Accounting/Measurement Focus - Continued
Government-Wide Financial Statements - Continued
Accordingly, all of the City’s assets and liabilities, including capital assets and
infrastructure as well as long-term debt, are included in the statement of net
assets. The statement of activities presents changes in net assets. Under the
accrual basis of accounting, revenues are recognized in the period in which they
are earned while expenses are recognized in the period in which the liability is
incurred.
The statement of activities demonstrates the degree to which the direct expenses
of a given function are offset by program revenues. Direct expenses are those that
are clearly identifiable with a specific function. The types of transactions
reported as program revenues for the City are reported in three categories: 1)
charges for services, 2) operating grants and contributions, and 3) capital grants
and contributions. Charges for services include revenues from customers or
applicants who purchase, use, or directly benefit from goods, services, or
privileges provided by a given function. Grant and contributions include revenues
restricted to meeting the operational or capital requirements of a particular
function. Taxes and other items not properly included among program revenues
are reported instead as general revenues.
All internal balances in the statement of net assets and internal transactions in the
statement of activities have been eliminated. The purpose of transfers between
funds was to record proper allocation of expenses.
Amounts reported as program revenues include (1) charges to customers or
applicants for goods, services, or privileges provided, (2) operating grants and
contributions, and (3) capital grants and contributions, including special
assessments. Internally dedicated resources are reported as general revenues
rather than as program revenues. Likewise, general revenues include all taxes.
City of Blair, Nebraska
NOTES TO FINANCIAL STATEMENTS - CONTINUED
September 30, 2010
- 30 -
NOTE A. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - CONTINUED
2. Basis of Accounting/Measurement Focus - Continued
Governmental Fund Financial Statements
Governmental fund financial statements include a balance sheet and a statement
of revenues, expenditures, and changes in fund balances for all major
governmental funds. An accompanying schedule is presented to reconcile and
explain the differences in fund balances as presented in these statements to the net
assets presented in the government-wide financial statements. The City has
presented all major funds that meet the qualifications of GASB Statement No. 34.
All governmental funds are accounted for on a spending or “current financial
resources” measurement focus and the modified accrual basis of accounting.
Accordingly, capital assets and bonds payable are not included on the balance
sheet. The statement of revenues, expenditures and changes in fund balances
present increases (revenues and other financing sources) and decreases
(expenditures and other financing uses) in fund balances. Under modified accrual
basis of accounting, revenues are recognized in the accounting period in which
they become both measurable and available to finance expenditures of the current
period. Accordingly, revenues are recorded when received in cash, except that
revenues subject to accrual (generally 60-days after year-end are recognized when
due. The primary sources susceptible to accrual are property tax, sales tax,
transient occupancy tax, and grant revenues.
Expenditures are generally recognized under the modified accrual basis of
accounting when the related fund liability is incurred. An exception to this
general rule is principal and interest on general long-term debt which is
recognized when due.
The City reports the following major governmental funds:
The General Fund is the government’s primary operating fund. It accounts for all
financial resources of the City, except those required to be accounted for in
another fund.
The Debt Service Fund is used to account for the payment of principal and
interest on general long-term debt. The primary sources of revenue are property
taxes and special assessments.
City of Blair, Nebraska
NOTES TO FINANCIAL STATEMENTS - CONTINUED
September 30, 2010
- 31 -
NOTE A. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - CONTINUED
2. Basis of Accounting/Measurement Focus - Continued
Governmental Fund Financial Statements - Continued
The Street Fund is used to record transactions in the Street department, as the
State of Nebraska requires an accounting to verify the matching of funds it
provides for this purpose.
The Keno Fund maintains an accounting of Keno gambling activity because the
funds earned are restricted to community betterment projects and require special
state reporting.
The Capital Projects Fund is used to record transactions in the TIF 2 development
area, as the funds are required to be accounted for separately.
Proprietary Fund Financial Statements
Proprietary Fund Financial Statements include a statement of net assets, a
statement of revenues, expenses and changes in fund net assets, and a statement of
cash flows for each major proprietary fund. A column representing internal
service funds is also presented in these statements. However, internal service
balances and activities have been combined with the governmental activities in
the Government-Wide financial statements.
Proprietary funds are accounted for using the “economic resources” measurement
focus and the accrual basis of accounting. Accordingly, all assets and liabilities
(whether current or noncurrent) are included on the statement of net assets. The
statement of revenues, expenses and changes in fund net assets presents increases
(revenues) and decreases (expenses) in total net assets. Under the accrual basis of
accounting, revenues are recognized in the period in which they are earned while
expenses are recognized in the period in which the liability is incurred.
Proprietary funds distinguish operating revenues and expense from non-operating
items. Operating revenues and expense 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 include the
cost of services, administrative expenses, and depreciation on capital assets. All
revenues and expenses not meeting this definition are reported as non-operating
revenues and expenses.
City of Blair, Nebraska
NOTES TO FINANCIAL STATEMENTS - CONTINUED
September 30, 2010
- 32 -
NOTE A. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - CONTINUED
2. Basis of Accounting/Measurement Focus - Continued
Proprietary Fund Financial Statements - Continued
The City reports the following major proprietary funds:
The Water and Sewer Fund accounts for the activities related to the operation of
the City’s water delivery and sewage systems. It operates the water treatment and
sewer treatment plants, water distribution systems, sewer collection systems, and
pump stations.
Internal service funds of the City (which provide services primarily to other funds
of the City) are presented, in summary form, as part of the proprietary fund
financial statements. Since the principal users of the internal services are the
City’s governmental activities, financial activities of the internal service funds are
presented in the governmental activities column when presented at the
government-wide level. The costs of these services are allocated to the
appropriate function/program (public safety, streets, culture and recreation, public
improvements, planning and zoning, water and sewer services, and general
administrative services) in the statement of activities.
Fiduciary Fund Financial Statements
Fiduciary fund financial statements include a statement of net assets. The City’s
Fiduciary fund represents an agency fund, which is custodial in nature (assets
equal liabilities) and does not involve measurement of results of operations.
Accordingly, it presents only a statement of fiduciary net assets and does not
present a statement of changes in fiduciary net assets. Fiduciary funds are not
reflected in the government-wide financial statements because the resources of
those funds are not available to support the City’s own programs. The agency
fund is accounted for on a spending or “economic resources” measurement focus
and the accrual basis of accounting as is the proprietary funds explained above.
The City reports the following fiduciary fund:
The TIF 1 Fund is an agency fund that accounts for the activities related to
redevelopment costs financed by tax incremental finance bonds. The tax
incremental finance bonds are to be paid by the taxes of the redeveloped area.
City of Blair, Nebraska
NOTES TO FINANCIAL STATEMENTS - CONTINUED
September 30, 2010
- 33 -
NOTE A. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - CONTINUED
3. Budgetary Policy and Control
Budgetary Basis of Accounting
The City’s legally adopted budget is not in conformity with accounting principles
generally accepted in the United States of America, but meets the requirements of
the Nebraska Budget Act. The budget is prepared and adopted using the cash
basis of accounting whereby revenues budgeted are expected to be received rather
than earned and expenditures budgeted are expected to be disbursed rather than
incurred. Differences between the budgeted basis of accounting and the generally
accepted basis are reconciled in the budget to actual schedule in the required
supplementary information. The City Council sets the property tax levy needed to
support the coming year’s budget in August of each year and submits its budget as
required by State statute.
Budgetary Control
Each fund’s appropriated budget is prepared on a detailed line item basis.
Revenues are budgeted by source. Expenditures are budgeted by department.
Expenditures at the fund level constitute the legal level of control. Expenditures
may not exceed appropriations at this level. All budget revisions at this level are
subject to final review by the Council. No revisions to the budget were made for
the year ended September 30, 2010.
4. The Use of Estimates
The preparation of financial statements in conformity with generally accepted
accounting principles requires management to make estimates and assumptions
that affect certain reported amounts and disclosures. Accordingly, actual results
could differ from those estimates.
5. Deposits and Investments
The City’s cash and cash equivalents are considered to be cash on hand, demand
deposit and short-term investments with original maturities of three months or
less from the date of acquisition.
Investments are restricted and consist of certificates of deposit shown at cost.
There are no significant differences in cost and fair values at September 30, 2010.
City of Blair, Nebraska
NOTES TO FINANCIAL STATEMENTS - CONTINUED
September 30, 2010
- 34 -
NOTE A. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - CONTINUED
6. Capital Assets
Capital assets, which include land, buildings, and equipment (furniture, vehicles,
etc.) and infrastructure assets (street systems, storm drains, etc.), are reported in
governmental activities column of the government-wide financial statements.
Capital assets are defined by the City as assets with an initial, individual cost of
more than $5,000. Such assets are recorded at historical cost or estimated
historical cost if purchased or constructed. Donated or annexed capital assets are
recorded at estimated market value at the date of donation or annexation.
The costs of normal maintenance or repairs that do not add to the value of the
asset or materially extend assets lives are not capitalized. Major outlays for
capital assets and improvements are capitalized as projects are constructed. The
City qualifies for the exemption under GASB 34 to not retroactively apply the
capitalization requirements of general infrastructure assets. The requirement to
capitalize and depreciate these assets has been applied as of October 1, 2003.
Depreciation is recorded in the government-wide financial statements on a
straight-line basis over the useful life of the assets as follows:
Assets Years
Equipment 10
Vehicles 5
Buildings 40
Street infrastructure 40
7. Property Taxes
Property tax revenue is recognized when collected by the County as the City’s
agent within the current period. There are no property taxes due which are not
delinquent and all delinquent taxes are considered collectible.
The City’s December 31, 2009 valuation was $457,537,882. The levy for the
City for the year ending September 30, 2010 was $0.3569 per $100 of value. The
total tax levy was $1,632,785. Property taxes are collected by the County and are
due December 31 of each year and delinquent in halves at May 1 and September 1
of the following year. In-lieu of tax receipts are equivalent in value to payments
for service provided.
City of Blair, Nebraska
NOTES TO FINANCIAL STATEMENTS - CONTINUED
September 30, 2010
- 35 -
NOTE A. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - CONTINUED
8. Claims and Judgments Payable
The City records a liability for litigation, judgments, and claims when it is
probable that an asset has been impaired or a liability has been incurred prior to
year-end and the probable amount of loss (net of any insurance coverage) can be
reasonably estimated. The liability, if any, is reported in the government-wide
statement of net assets. The portion of the liability, which will be liquidated with
expendable, available financial resources, if any, is reflected as a liability of
applicable governmental funds.
9. Compensated Absences
General leave for the City includes both vacation and sick pay. Vacation leave is
based on an employee’s length of employment. An employee is allowed to carry
forward each year, on their anniversary date, that year’s earned vacation, plus 40
hours. Sick leave is earned at a rate approved by the personnel manual, which is
currently six (6) hours per month. Sick leave can be accumulated to a maximum
of 840 hours and can only be used for illness, medical care, and care of sick
members of the immediate family per the personnel manual.
Upon termination of employment, an employee is entitled to be compensated for
all accumulated unused vacation pay. Unused sick leave is compensated as
follows: (1) Upon death or retirement, 50% (2) Upon resignation in good
standing, 5% after 10 years of employment increasing to a maximum of 50% after
20 years of employment.
10. Restricted Assets
Assets are reported as restricted when limitations on their use change the nature or
normal understanding of the availability of the asset. Such constraints are either
externally imposed by creditors, contributions, grantors, or laws of other
governments, or are imposed by law through constitutional provisions or enabling
legislation. The City’s policy is to first apply restricted resources to an expense
when incurred for purposes for which both restricted and unrestricted net assets
are available. Restricted assets in the governmental funds are related to the
reserved fund balances. Restricted assets in the proprietary funds are related to
the restricted for debt service fund balances.
City of Blair, Nebraska
NOTES TO FINANCIAL STATEMENTS - CONTINUED
September 30, 2010
- 36 -
NOTE A. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - CONTINUED
11. Allowance for doubtful accounts
The City uses the direct write-off for uncollectable accounts. The doubtful
accounts at September 30, 2010 were insignificant.
12. Transfers
Transfers are used to move revenues from the fund that statute or budget requires
to collect them to the fund that statute or budget requires to expend them and to
move unrestricted revenue collected in the general fund to finance various
programs accounted for in other funds in accordance with budgetary
authorizations.
NOTE B. DEPOSITS AND INVESTMENTS
Deposits and investments consist of demand deposits and certificates of deposit. The
City maintains a cash pool that is available for all funds. The carrying amount of the
City’s cash deposits was $4,630,383 at September 30, 2010. The bank balances of the
City’s cash deposits at September 30, 2010 was $3,598,293. The City’s investments
were made up of $1,080,173 of certificates of deposit. The City’s cash deposits and
certificates of deposit were either entirely insured or collateralized with securities held by
the pledging financial institutions in the City’s name.
The City has no formal policy for handling credit risk, interest rate risk, or concentration
risk; however, deposits and investments consist of demand deposits, certificates of
deposits, and United States Treasury Notes. The statutes of the State of Nebraska require
that local governmental units follow the “prudent man” rule with deposits, and that
deposits be secured by collateral valued at market or par whichever is lower less the
amount insured by the Federal Deposit Insurance Corporation. The City has no deposit
and investment policy that would further limit its deposits, but the City administratively
has required all deposits to be collateralized at 105%.
City of Blair, Nebraska
NOTES TO FINANCIAL STATEMENTS - CONTINUED
September 30, 2010
- 37 -
NOTE C. CAPITAL ASSETS
A summary of changes in capital assets is as follows:
Governmental Activities
Balance Balance
September 30,
2009
Increases
Decreases
September 30,
2010
Capital assets not depreciated
Land $ 206,241 $ - $ - - $ 206,241
Other capital assets
Street infrastructure 10,032,570 2,472,519 - 12,505,089
Buildings 5,658,662 44,360 - 5,703,022
Equipment 3,720,389 396,606 (86,093) 4,030,902
Total other capital assets 19,411,621 2,913,485 (86,093) 22,239,013
Less accumulated depreciation
Street infrastructure (797,613) (327,249) - (1,124,862)
Buildings (2,081,626) (143,681) - (2,225,307)
Equipment (2,213,352) (196,835) 86,093 (2,324,094)
Total accumulated
depreciation (5,092,591) (667,765) 86,093 (5,674,263)
Other capital assets, net 14,319,030 2,245,720 - 16,564,750
Governmental activities capital
assets, net $ 14,525,271 $ 2,245,720 $ - $ 16,770,991
Depreciation expense was charged to functions as follows:
Governmental Activities:
Administration $ 57,378
Police 40,942
Fire 113,840
Parks 45,815
Library 4,218
Swimming pool 21,941
Animal control 8,139
Streets 375,492
Total depreciation $ 667,765
City of Blair, Nebraska
NOTES TO FINANCIAL STATEMENTS - CONTINUED
September 30, 2010
- 38 -
NOTE C. CAPITAL ASSETS - CONTINUED
Business-Type Activities
Balance Balance
September 30,
2009
Increases
Decreases
September 30,
2010
Capital assets not depreciated
Land $ 423,783 $ - - $ - - $ 423,783
Other capital assets
Infrastructure 47,539,681 94,460 - 47,634,141
Equipment 2,006,848 176,347 (19,269) 2,163,926
Total other capital assets 49,546,529 270,807 (19,269) 49,798,067
Less accumulated depreciation
Infrastructure (12,513,571) (1,226,154) - (13,739,725)
Equipment (1,631,614) (72,875) 19,269 (1,685,220)
Total accumulated
depreciation (14,145,185) (1,299,029) 19,269 (15,424,945)
Other capital assets, net 35,401,344 (1,028,222) - 34,373,122
Business-type activities capital
assets, net $ 35,825,127 $ (1,028,222) $ - $ 34,796,905
NOTE D. BONDS PAYABLE
A summary of the changes followed by principal and interest schedules and is as follows:
Governmental Activities
Balance Balance
Interest September 30, September 30,
Dated Description Rate 2009 Additions Reductions 2010
12/15/2002 Various purpose 1.60 - 4.25%420,000$ -$ (135,000)$ 285,000$
7/19/2005 Various purpose 2.90 - 4.25%720,000 - (85,000) 635,000
6/15/2006 Various purpose 3.70 - 4.35%505,000 - (65,000) 440,000
9/28/2007 Various purpose 3.70 - 5.00%2,555,000 - (130,000) 2,425,000
12/14/2007
Tax increment
financing bond 4.48% 1,140,000 - (40,000) 1,100,000
2/26/2008
Public safety tax
anticipation bonds 2.75 - 4.25% 665,000 - (35,000) 630,000
5/18/2010 Various purpose 0.85% - 4.25% - 1,270,000 - 1,270,000
Total 6,005,000$ 1,270,000$ (490,000)$ 6,785,000$
Business-type Activities
Balance Balance
Interest September 30, September 30,
Dated Description Rate 2009 Additions Reductions 2010
WATER DEBT
6/15/2000 Refunding Bonds 4.70 - 5.55% 690,000$ -$ (135,000)$ 555,000$
4/29/2002 DEQ Bonds 3.03% 4,655,397 - (658,343) 3,997,054
6/1/2006 NRD Bonds 4.15 - 4.75%1,895,976 - (315,996) 1,579,980
4/24/2007 WA BANS 2007 4.50% 6,500,000 - (6,500,000) -
8/15/2007 WA BANS 2007B 4.65% 8,000,000 - - 8,000,000
9/28/2010
2010B Revenue
Bonds 2.75% - 6,500,000 - 6,500,000
9/28/2010
2010C Revenue
Bonds 3.25% - 770,000 - 770,000
Total water 21,741,373$ 7,270,000$ (7,609,339)$ 21,402,034$
SEWER DEBT
12/15/2004 Revenue Bonds 2.05 - 4.25% 685,000$ -$ (60,000)$ 625,000$
6/26/2007 SE BANS Series 2007 4.05% 1,455,000 - (1,455,000) -
8/17/2010 2010 Revenue Bonds 2.70% - 1,645,000 - 1,645,000
Total sewer 2,140,000$ 1,645,000$ (1,515,000)$ 2,270,000$
City of Blair, Nebraska
NOTES TO FINANCIAL STATEMENTS - CONTINUED
For the year ended September 30, 2010
- 39 -
NOTE D. BONDS PAYABLE - CONTINUED
Governmental Activities
Principal Interest Total
590,000$ 274,609$ 864,609$
620,000 253,882 873,882
505,000 230,772 735,772
470,000 212,483 682,483
495,000 194,548 689,548
2,050,000 708,180 2,758,180
1,685,000 299,013 1,984,013
370,000 28,000 398,000
6,785,000$ 2,201,487$ 8,986,487$
Business-type Activities
Principal Interest Total
1,134,438$ 784,875$ 1,919,313$
9,170,151 819,997 9,990,148
1,196,495 405,241 1,601,736
1,158,492 360,770 1,519,262
1,081,160 318,490 1,399,650
1,981,298 1,281,347 3,262,645
2,290,000 939,124 3,229,124
2,765,000 445,271 3,210,271
625,000 11,594 636,594
21,402,034$ 5,366,709$ 26,768,743$
Principal Interest Total
65,000$ 63,327$ 128,327$
60,000 85,598 145,598
65,000 83,361 148,361
65,000 80,940 145,940
70,000 78,340 148,340
505,000 340,921 845,921
510,000 249,091 759,091
625,000 136,280 761,280
305,000 6,634 311,634
2,270,000$ 1,124,492$ 3,394,492$
Bonds issued for the water and sewer funds are collateralized by a pledge of revenues derived and to be derived from the
operations of the water and sewer fund. Sinking fund requirements for Water and Sewer debt were a total reserve of
$1,071,235 at September 30, 2010.
2021-2025
2026-2030
Total
2013
2014
2015
2016-2020
2021-2025
2026-2029
Total
2014
2015
2016-2020
City of Blair, Nebraska
NOTES TO FINANCIAL STATEMENTS - CONTINUED
For the year ended September 30, 2010
2013
Year ending September 30,
2011
2012
- 40 -
2011
2012
2013
2014
Total
2031
2016-2020
2021-2025
2026-2030
Water Bonds
Sewer Bonds
2011
2012
2031
2015
Year ending September 30,
Year ending September 30,
City of Blair, Nebraska
NOTES TO FINANCIAL STATEMENTS - CONTINUED
September 30, 2010
- 41 -
NOTE E. RISK MANAGEMENT
The City of Blair is exposed to various risks of loss related to torts; theft, damage to and
destruction of assets; errors and omissions; injuries to employees; and natural disasters.
These risks are covered by the purchase of commercial insurance. The City assumes
liability for any deductibles and claims in excess of coverage limitations. Settled claims
from these risks have not exceeded commercial insurance coverage in any of the past
three fiscal years.
NOTE F. NET ASSETS
In the government-wide financial statements net assets are classified in the following
categories:
Invested in Capital Assets - This category groups all capital assets, including
infrastructure, into one component of net assets. Accumulated depreciation on these
assets reduces this category.
Restricted Net Assets - This category presents external restrictions imposed by creditors,
grantors, contributors or laws or regulations of other governments and restrictions
imposed by law through constitutional provisions or enabling legislation.
Unrestricted Net Assets- This category represents the net assets of the City that are not
restricted for any project or other purpose.
In the Fund financial statements, reserves and designations segregate portions of fund
balance that are either not available or have been earmarked for specific purposes. The
various designations are established by actions of the City Council and Management and
can be increased, reduced, or eliminated by similar actions.
Following is a description and summary of reservations of fund balance at September 30,
2010:
Donated Funds - The City has received donations toward specific projects. The
undisbursed funds with specific restrictions are accounted for in the donated fund
balance.
Debt Service - The Water and Sewer restricted cash is a sinking fund required by
conditions of Revenue Bonds. These funds will become unrestricted in the year 2010.
City of Blair, Nebraska
NOTES TO FINANCIAL STATEMENTS - CONTINUED
September 30, 2010
- 42 -
NOTE F. NET ASSETS – CONTINUED
Community Betterment - The City has sponsored a licensed Keno operation and the
restricted funds are the accumulation of net proceeds to be used only for community
betterment projects.
Capital Projects - The TIF 2 fund balance is restricted to development projects within the
TIF 2 area.
NOTE G. PENSION PLANS
The City has three pension plans covering substantially all of its employees. Employees
other than policemen are covered by a defined contribution plan, either a 414(h) or
457(b) plan. Policemen are covered under a defined contribution plan established by the
statutes of the State of Nebraska.
The 414(h) pension plan was established on April 1, 1996 and last restated on August 25,
2008 (effective January 1, 2008). All contributions from a minimum of 3% up to 6% of
gross wages in employee contributions and up to a 6% match of gross wage in
contributions from the City are invested with an investment manager. The employees
must have accumulated six months of service, be at least age 21, and work 40 hours per
week to participate in the plan. Employees are 100% vested in employer contributions
after six years of service. The plan is a single employer plan with the City maintaining
fiduciary responsibility for it. Contributions for the year ended September 30, 2010,
totaled $170,690 which consisted of $85,345 contributed by employees and $85,345
contributed by the City. Contributions are expected to remain relatively level from year
to year. The City may amend, modify, or terminate the 414(h) plan. Funds in the plan
cannot be diverted to any purposes other than for the exclusive benefit of the participants
or their beneficiaries or estates.
The 457(b) pension plan was established on July 1, 2008. The 457(b) plan allows
employees to contribute additional dollars to their pension above the 414(h) requirement
and match. The City will contribute a maximum match of 6% based on a one-to-one
match.
City of Blair, Nebraska
NOTES TO FINANCIAL STATEMENTS - CONTINUED
September 30, 2010
- 43 -
NOTE G. PENSION PLANS - CONTINUED
between the 457(b) and 414(h) plans. An employee can contribute voluntary pre-tax
amounts up to the legal limits as established by IRS code. The plan is a single employer
plan with the City maintaining fiduciary responsibility for it. Contributions for the year
ended September 30, 2010, totaled $65,338 which consisted of $54,115 contributed by
employees and $11,223 contributed by the City. Contributions are expected to remain
relatively level from year to year. The City may amend, modify, or terminate the 457(b)
plan. Funds in the plan cannot be diverted to any purposes other than for the exclusive
benefit of the participants or their beneficiaries or estates.
The policemen are covered under a defined contribution plan established by the statues of
the State of Nebraska. Policemen terminating before retirement age receive payment for
their contributions to date of termination plus interest accrued and the vested portion of
the City’s contributions based on the statues of the State of Nebraska. The City has
fiduciary responsibility for the plan and it is a single employer plan only. Contributions
of $112,270 for 2010, were 12% of gross wages, which complies with statutory
requirements. The City contributed 6% of gross wages and the policemen contributed
6%. The City expects contributions to remain relatively level from year to year. The
contributions are not actuarially determined. All qualifying police payroll was covered in
2010.
NOTE H. CONTRACT RECEIVABLE
In April 1984, the City contracted to sell its electrical transmission and distribution
generating facilities to the Omaha Public Power District. The terms of the agreement
were as follows:
Omaha Public Power District agreed to buy the City facilities for the sum of $5.95
million. The terms of payment shall be $1.0 million payable at the date of the
contract and the balance of $4.95 million amortized over thirty years at nine
percent interest per annum, with annual payments of $481,815 commencing in
April 1985. This contract is unsecured.
This contract also provided for the Omaha Public Power District to supply electrical
service directly to the City and its residents. The transfer of electrical services was
completed on September 30, 1984.
City of Blair, Nebraska
NOTES TO FINANCIAL STATEMENTS - CONTINUED
September 30, 2010
- 44 -
NOTE I. LANDFILL CLOSURE
The City has closed its landfill operations. All material closing and monitoring costs
were accrued over the remaining life of the landfill. The Landfill closed October 31,
1993 and any remaining monitoring costs will be paid from City funds but are not
anticipated to be material to the financial statements.
NOTE J. SPECIAL ASSESSMENTS RECEIVABLE
The City’s special assessments outstanding as of September 30, 2010, are composed of
special assessment principle of $2,868,310.
The delinquent special assessments at September 30, 2010 are 9% of those outstanding.
No special assessments have been pledged to specific debt, although special assessments
principle and interest is reserved for various purpose bonds payments only.
NOTE K. CONCENTRATION OF CREDIT RISK
All of the receivables of the City proprietary funds and special assessments in the debt
service fund are from the local Blair area, thereby creating a concentration of credit risk.
If the Blair area economy was depressed, this could have an adverse effect on the
collection of the outstanding accounts receivable. Cargill, Inc. is a major water customer
for the City. Cargill, Inc. represents 83.5% of water sales for the year ended September
30, 2010. Although Cargill represents 83.5% of water sales, the City has a contract with
the company that secures a minimum monthly revenue stream for payment of the water
debt through June 2032, which minimizes the risk for payment of water bonds.
NOTE L. SELF INSURANCE
The City’s Self Insurance Fund is used to account for employee health, dental, and vision
liability claims and is accounted for as an internal service fund. Claims expense as
reported in the fund was reported based on actual expenses paid during the year fiscal
year ended September 30, 2010. The City has not recorded a liability for insurance
claims expected to be paid in future years, as the amount of these future claims cannot be
reasonably estimated. For the fiscal year ending September 30, 2010, the Self Insurance
Fund received inter-fund premiums of $587,686 from various City departments in
monthly payments. Additionally, the fund received premiums $175,419 from employees
of the City. Claims expense for the year, which totaled $879,963, exceeded the total
premiums of $116,858 received by the fund. This $116,858 was covered in whole or part
by reinsurance and reserves.
City of Blair, Nebraska
NOTES TO FINANCIAL STATEMENTS - CONTINUED
September 30, 2010
- 45 -
NOTE L. SELF INSURANCE - CONTINUED
The City has purchased insurance for claims expenses incurred over a certain dollar
amount each year in order to limit its risk of loss. The cost of this insurance for the fiscal
year was $150,400. For the year ended September 30, 2010, the City received $281,398
in insurance recoveries from claims. These recoveries have been reported as other
operating revenues in the statement of revenues, expenses, and changes in fund net assets,
proprietary funds.
NOTE M. GASBS No. 54
In March 2009, the Governmental Accounting Standards Board (GASB) approved
Statement No. 54, Fund Balance Reporting and Governmental Fund Type Definitions
(Statement). Certain significant changes in the Statement will require the following:
Fund balances for each of the City’s governmental funds (General Fund, Special Revenue
Funds, Capital Projects Fund, and Debt Service Fund) will be displayed in the following
classifications depicting the relative strength of the spending constraints placed on the
purposes for which resources can be used:
Nonspendable fund balance—amounts that cannot be spent because they are
either not in a spendable form (such as inventories and prepaid amounts) or are
legally or contractually required to be maintained intact.
Restricted fund balance—amounts that can be spent only for specific purposes
because of constraints imposed by external providers (such as grantors,
bondholders, and higher levels of government), or imposed by constitutional
provisions or enabling legislation.
Committed fund balance—amounts that can be spent only for specific purposes
determined by a formal action of the government’s highest level of decision-
making authority.
Assigned fund balance—amounts the government intends to use for specific
purposes that do not meet the criteria to be classified as restricted or committed.
Unassigned fund balance—amounts that are available for any purpose; these
amounts can be reported only in the City’s General Fund.
City of Blair, Nebraska
NOTES TO FINANCIAL STATEMENTS - CONTINUED
September 30, 2010
- 46 -
NOTE M. GASBS No. 54 - CONTINUED
The Statement also establishes several new presentation and disclosure requirements,
including requirements related to stabilization arrangements (i.e., “rainy day” amounts).
In addition, the Statement clarifies the definitions of the various types of governmental
funds. Interpretations of certain terms within the new definition of special revenue funds
may affect which activities the City can report in special revenue funds.
The provisions of GASBS No. 54 must be implemented by the City no later than the
fiscal year beginning October 1, 2010. Implementation will require the City to restate
existing fund balances for the governmental funds.
SUPPLEMENTAL INFORMATION
Original and Variance
Final Favorable
Budget Actual (Unfavorable)
REVENUES
Taxes 3,497,000$ 3,455,109$ (41,891)$
Charges for services 407,250 469,715 62,465
Interest income 2,800 3,701 901
Other revenues 1,555,714 884,300 (671,414)
Total revenues 5,462,764 4,812,825 (649,939)
EXPENDITURES
Administration 2,913,070 718,238 2,194,832
Police Department 1,696,506 1,661,614 34,892
Fire Department 242,160 280,883 (38,723)
Parks Department 495,318 438,111 57,207
Library 506,060 293,228 212,832
Swimming Pool 51,200 55,101 (3,901)
Zoning 308,021 288,615 19,406
Animal control 93,797 83,329 10,468
Donated Funds 114,711 29,680 85,031
Total expenditures 6,420,843 3,848,799 2,572,044
REVENUES OVER (UNDER) EXPENDITURES (958,079) 964,026 1,922,105
OTHER FINANCING SOURCES (USES)
Operating transfers - in 1,422,000 1,123,505 (298,495)
Operating transfers - out (2,018,500) (1,749,769) (268,731)
REVENUES AND OTHER FINANCING
SOURCES OVER (UNDER) EXPENDITURES
AND OTHER SOURCES (1,554,579) 337,762 1,354,879$
FUND BALANCE - September 30, 2009 1,277,087 1,277,087
FUND BALANCE - September 30, 2010 (277,492)$ 1,614,849
2,709,445
(845,296)
508,532
3,987,530$
See independent auditor's report.
City of Blair, Nebraska
BUDGETARY COMPARISON SCHEDULE
For the year ended September 30, 2010
GENERAL FUND AND MAJOR SPECIAL REVENUE FUNDS
Accrual adjustments made because the City budgets for revenues and
expenditures on the cash basis, rather than on the modified accrual basis.
- 48 -
An explanation of the differences between budgetary inflows and outflows and
revenues and expenditures determined in accordance with generally accepted
accounting principles follows:
The budget fund balance at the beginning of the year is a based on cash
reserves rather than fund balance.
General Fund Balance
Adjustments for expenses paid out of the general fund that were for other
funds.
Original and Variance
Final Favorable
Budget Actual (Unfavorable)
REVENUES
Taxes
Property tax 1,288,000$ 1,206,302$ (81,698)$
Sales tax 1,700,000 1,708,448 8,448
Motor vehicle tax 134,000 125,922 (8,078)
Occupation and franchise tax 280,000 249,643 (30,357)
Other taxes 95,000 164,794 69,794
Total 3,497,000 3,455,109 (41,891)
Charges for services
Business licenses and permits 181,450 222,049 40,599
Library 14,000 14,929 929
Equipment rental 19,000 21,862 2,862
Cemetery lots 15,000 7,800 (7,200)
Grave openings 22,000 20,900 (1,100)
Towing 21,000 17,505 (3,495)
Rescure Squad 110,000 139,794 29,794
Other fees and charges 4,200 4,267 67
Sales of fireworks 15,000 15,000 -
RV park 5,600 5,609 9
Total 407,250 469,715 62,465
INTEREST INCOME 2,800 3,701 901
OTHER REVENUES
State grants 76,000 79,008 3,008
Federal grants 810,000 9,694 (800,306)
Donations 86,250 38,295 (47,955)
Reimbursements 40,000 178,313 138,313
Other miscellaneous revenue 543,464 578,990 35,526
Total 1,555,714 884,300 (671,414)
Total revenues 5,462,764$ 4,812,825$ (649,939)$
City of Blair, Nebraska
GENERAL FUND REVENUES
For the year ended September 30, 2010
BUDGETARY COMPARISON SCHEDULE
- 49 -
See independent auditor's report.
Original and Variance
Final Favorable
Budget Actual (Unfavorable)
REVENUES
Highway allocation 550,000$ 525,859$ (24,141)$
Property taxes 269,500 256,623 (12,877)
Other taxes 98,500 99,998 1,498
Incentive payment 6,000 6,000 -
State maintenance agreement 22,000 27,248 5,248
In-Lieu of tax 10,000 10,744 744
Homestead exemption - 10,365 10,365
Interest income 750 23 (727)
Other revenue 1,657,000 407,172 (1,249,828)
Total revenues 2,613,750 1,344,032 (1,269,718)
EXPENDITURES
Salaries 354,670 339,307 15,363
FICA 25,000 23,934 1,066
Employee insurance 116,116 96,154 19,962
Retirement 20,400 18,964 1,436
Legal 8,000 3,142 4,858
Auditing 8,600 7,727 873
Engineering 10,000 102,763 (92,763)
Office expense 5,250 3,934 1,316
Utilities 7,000 10,090 (3,090)
Telephone 2,400 2,757 (357)
Travel 5,000 6,393 (1,393)
Training 1,200 2,322 (1,122)
Insurance 19,000 10,837 8,163
Maintenance 44,750 41,548 3,202
Street lighting 158,000 173,556 (15,556)
County fees - 2,798 (2,798)
Car expense 2,000 3,330 (1,330)
Contract mowing 16,000 16,472 (472)
Gas, diesel, and oil 28,000 36,886 (8,886)
Materials and supplies 146,100 163,037 (16,937)
Rental 10,000 4,199 5,801
Capital outlayEquipment 140,000 143,900 (3,900)
Street improvements 1,399,000 728,385 670,615
Total expenditures 2,526,486 1,942,435 584,051
REVENUES OVER (UNDER) EXPENDITURES 87,264 (598,403) (685,667)
OTHER FINANCING SOURCES (USES)
Payment of warrant liabilities (851,000) 769,732 1,620,732
Operating transfers - in 763,500 1,518,996 755,496
REVENUES AND OTHER FINANCING SOURCES
OVER (UNDER) EXPENDITURES AND OTHER SOURCES (236) 1,690,325 1,690,561$
FUND BALANCE - September 30, 2009 95,955 95,955
FUND BALANCE - September 30, 2010 95,719$ 1,786,280
The budget fund balance at the beginning of the year is a based on cash reserves rather than fund balance. (117,620)
(1,604,974)
63,686$
An explanation of the differences between budgetary inflows and outflows and revenues and expenditures
determined in accordance with generally accepted accounting principles follows:
- 50 -
Accrual adjustments made because the City budgets for revenues and expenditures on the cash basis, rather than
on the modified accrual basis.
Street Fund Balance
City of Blair, Nebraska
BUDGETARY COMPARISON SCHEDULE
STREET FUND
For the year ended September 30, 2010
See independent auditor's report.
Original and Variance
Final Favorable
Budget Actual (Unfavorable)
GROSS PROCEEDS -$ 862,624$ 862,624$
PRIZES
Declared prizes - 658,783 658,783
Unclaimed wins - (2,317) (2,317)
Net Prizes paid - 656,466 656,466
NET HOLD - 206,158 206,158
ALLOWABLE EXPENSES PAID
Lottery Operator's Commission - (120,767) (120,767)
NET KENO PROCEEDS 80,000 85,391 5,391
EXPENSES PAID BY CITY
State taxes 17,600 17,252 348
Other expenses 3,200 100 3,100
TOTAL EXPENSES PAID 20,800 17,352 3,448
PROCEEDS AVAILABLE FOR DISTRIBUTION 59,200 68,039 8,839
TRANSFER FROM (TO) PRIZE RESERVES - (5,437) (5,437)
COMMUNITY BETTERMENT - Direct 70,000 7,000 (63,000)
TRANSFER TO GENERAL 61,000 35,000 (26,000)
TRANSFER TO STREET 41,000 30,000 (11,000)
TRANSFER TO DEBT SERVICE 25,000 10,000 (15,000)
NET AFTER TRANSFERS (137,800) (19,398) 118,402
Beginning Keno account
Fund balance 129,348 129,348 -
Interest 100 122 22
Reimbursements - - -
KENO ACCOUNT FUND BALANCE (8,352)$ 110,072$ 118,424$
PRIZE RESERVE FUND RECONCILIATION FOR
THE REPORTING PERIOD
Beginning reserve balance 41,547$
Increase in reserve 21,236
Withdrawals from reserve (15,800)
Ending reserve balance (deficit)46,983$
City of Blair, Nebraska
BUDGETARY COMPARISON SCHEDULE
KENO FUND
For the year ended September 30, 2010
- 51 -
See independent auditor's report.
City of Blair, Nebraska
SCHEDULE OF FINDINGS AND RESPONSES
For the year ended September 30, 2010
- 54 -
Finding 10-01: Financial Statements and Adjustments
Criteria - Many organizations, including the City, rely on their auditor to generate the
annual financial statements including footnotes. We assisted in the proper presentation of
the financials and proposed material adjusting entries to present fairly the financial
statements of the City.
Condition - The City of Blair keeps it books on a cash basis and relies on its auditors to
prepare the financial statements.
Cause - Lack of the required expertise in preparing the basic set of financial statements.
Effect - Material adjusting entries are required to be made during the audit for the proper
presentation of the City’s financial statements.
Recommendation - The City of Blair may consider gathering the necessary expertise to
prepare a required set of financial statements in a format acceptable for GAAP reporting.
Officials Response – The City Treasurer has started a process to develop government
wide and fund financial statements using its accounting software for fund financials and
an excel worksheet for government-wide financials. This process should be in place for
next year’s financial statement preparation.
Finding 10-02: Documentation of Policies and Procedures
Criteria - The City of Blair should have formalized policies and procedures for its key
administrative functions. A standard operating procedure (SOP) can be an effective
catalyst to drive performance improvements and improving overall results. SOP’s will
ensure that City operations are done consistently, approved procedures are being
followed in compliance with City regulations, they will serve as training documents for
teaching users about processes, and they will serve as a historical record of the how,
where, when, and why of City’s operations and information.
Condition - Employees do not have documentation of procedures to support their job
duties.
Cause - Lack of formalized standard operating procedures and controls.
City of Blair, Nebraska
SCHEDULE OF FINDINGS AND RESPONSES - CONTINUED
For the year ended September 30, 2010
- 55 -
Finding 10-02 Continued:
Effect - Reliance on informal information from City Administrator and City Treasurer on
majority of City’s accounting procedures and information.
Recommendation - We recommend that the City formalize and maintain a policy and
procedures manual. This manual should include all key areas of activities, including
administration and operations. A policy and procedures manual will document how the
City operates and will support cross-training and reduce training issues relating to
employee turnover.
Officials Response - The City has drafted up formal policy and procedure documents in the
current fiscal year. These documents are still in draft stage but the City anticipates that they
will be formally adopted during the next fiscal year.
City of Blair, Nebraska
SUMMARY SCHEDULE OF PRIOR AUDIT FINDINGS
For the year ended September 30, 2010
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Finding 09-01:
Condition - The City of Blair keeps it books on a cash basis and relies on its auditors to
prepare the financial statements.
Recommendation - The City of Blair may consider gathering the necessary expertise to
prepare a required set of financial statements in a format acceptable for GAAP reporting.
Current Status – Unresolved, see finding 10-01
Finding 09-02:
Condition - Employees do not have documentation of procedures to support their job duties.
Recommendation - We recommend that the City formalize and maintain a policy and
procedures manual. This manual should include all key areas of activities, including
administration and operations. A policy and procedures manual will document how the City
operates and will support cross-training and reduce training issues relating to employee
turnover.
Current Status – Unresolved, see finding 10-02