HomeMy WebLinkAbout19 COMPREHENSIVE ANNUAL FINANCIAL REPORT FOR THE YRAgenda Item 19
AGENDA REPORT Reviewed:
Finance Director
MEETING DATE: FEBRUARY 1, 2011
TO: HONORABLE MAYOR AND COUNCIL MEMBERS
VIA: DAVID C. BIGGS, CITY MANAGER
FROM: PAMELA ARENDS-KING, FINANCE DIRECTOR
SUBJECT: COMPREHENSIVE ANNUAL FINANCIAL REPORT FOR THE YEAR
ENDED JUNE 30TH 2010
SUMMARY:
The City engages an independent certified public accounting firm to complete an annual
audit of the City's financial records. There are a number of reports such as the
Comprehensive Annual Financial Report (CAFR), produced as a result of the annual
audit and there are actions that are required by the City's governing board (City Council)
to meet the requirements of various auditing standards.
RECOMMENDATION:
1. Receive and file the CAFR for the year ended June 30, 2010.
2. Designate two council members to serve as a Council Audit Committee to
discuss the audit and internal control issues with the auditors to meet auditing
standard requirements.
FISCAL IMPACT:
The independent certified public accounting firm that the City contracted with to
complete the annual audit is Macias Gini & O'Connell LLP. Total cost of the annual
audit is $61,000. Of this amount, 25% or $15,250 is charged to the Redevelopment
Agency (RDA), 15% or $9,150 is charged to the Water Enterprise Fund and 60% or
$36,600 is charged to the General Fund.
BACKGROUND:
The reports that are produced as a result of the annual audit are the Redevelopment
Agency (RDA) audited financial statements that were submitted to council at the
December 6, 2010 Council meeting; the RDA State Controllers report; the City State
Controllers report, the Single Audit report (the audit of the federal grants awarded to the
City); the report of the auditors consideration of the City's internal control over financial
reporting and on their tests of its compliance with certain provisions of laws, regulations,
contracts, grant agreements and other matters; and the CAFR.
COMPREHENSIVE ANNUAL FINANCIAL REPORT FOR THE YEAR ENDED JUNE 30, 2010
February 1, 2011 Page 2 of 3
The auditors are in the process of completing the Single Audit, which is due to the
Federal Government in March 2011. When this report is finalized the auditors will also
complete their report on internal control issues and meet with the Council Audit Committee
to discuss the results of the audit. Usually the CAFR is completed when the RDA audited
financial statements are completed and presented to the Council the first council meeting
in December. With the finance software implementation during the summer and fall of
2010 and the vacancy of the Finance Manager position due to the current economic
situation, staff was unable to complete the schedules and year-end accounting for the
auditors to meet that usual schedule. As such, the CAFR is being submitted at this time.
The CAFR consists of a transmittal letter, independent auditor's report, a management's
discussion and analysis (MD & A); basic financial statements; notes to the financial
statements; supplementary information and a statistical section. The MD & A presents an
overview of the basic financial statements and what each section consists of and
discusses financial highlights for the year ended June 30, 2010.
General Fund financial highlights for the year ended June 30, 2010 are as follows:
• The City's General Fund total expenditures were $48 million, $2 million less than
prior year's expenditures and $3.4 million less than originally budgeted. The
primary reason for the decrease in expenditures is due to cutting expenses, not
filling vacant funded positions, and laying off employees towards the later part of
the June 30, 2010 fiscal year.
• General Fund revenues were $45.4 million. Revenues received were $3.4 million
less than prior fiscal year primarily due to the decrease in sales tax of $4.1 million.
Revenues were $1.3 million higher than what was projected for fiscal year
2009/2010. The increase in revenues from the projected figure despite the
significant decrease in sales tax revenue is primarily due to $1.2 million for the
collection of past due administrative fees for managing the community facility
districts; higher franchise tax and property tax revenues than what was projected;
and $2 million of interest income from the RDA for the agreement between the
Agency and the City for low/moderate housing activities.
• Transfers in for the General Fund were $28.5 million. The transfers in are made up
of a $1 million transfer from the RDA for rental income; the annual payment from
the RDA to the General Fund for the agreement between the Agency and the City
for low/moderate housing activities of $1.9 million; and a onetime additional
payment from the RDA of $23.5 million for the agreement between the General
Fund and the RDA for the low/moderate housing activities. The General Fund used
the $23.5 million for the land acquisition settlement for the property along Edinger
Avenue and the 55 freeway. The transfers in also included a onetime $2 million
transfer from the Capital Projects Fund to help balance fiscal year 2009/2010's
budget. The $2 million were funds that the General Fund transferred into the
Capital Project Funds in prior fiscal years.
COMPREHENSIVE ANNUAL FINANCIAL REPORT FOR THE YEAR ENDED
JUNE 30, 2010
February 1, 2011 Page 3 of 3
• Total revenues and transfers in of $73.9 million exceeded total expenditures of $48
million, by $25.8 million, therefore the General Fund's fund balance of $124.1
million as of June 30, 2009 increased to $150 million as of June 30, 2010. Of the
$150 million, $5.8 million are unreserved funds. Unreserved funds increased $2.3
million from prior fiscal year. The remainder of the fund balance is $144 million
reserved for Land held for resale. Land held for resale increased $23.5 million due
to the land acquisition settlement for the property along Edinger Avenue and the 55
freeway.
Other Financial Highlights for the year ended June 30, 2010 are as follows.-
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ollows:
• The City's assets, which encompass all governmental and business type activities
(i.e. General Fund, Special Revenue Funds, RDA Funds, Capital Projects Funds
and the Water Enterprise Fund) as of June 30, 2010, exceeded its liabilities by
$637.5 million (net assets). The net assets consist of $384.8 million invested in
capital assets, net of related debt, $135.6 million in restricted net assets and $117.1
million in unrestricted net assets. Total net assets increased $1.7 million from the
prior fiscal year.
• Net Long-term liabilities decreased $4.9 million. The net decrease is primarily due
to principal payoffs, a land acquisition settlement of $23.5, and the issuance of
2010 Housing Tax Allocation bonds of $26.1 million.
A more thorough discussion of the financial activities for the year ended June 30, 2010 is
presented in the MD & A.
Pamela Arends-King, Finance Director'
Approved for Forwarding By:
David C. Biggs, City Manager
Attachment: Comprehensive Annual Financial Report for the year ended
June 30, 2010
CITY OF TUSTIN,
i14152011"Mill
Comprehensive Annual Financial Report
For the year ended June 30th, 2010
T USTIN CITY COUNCIL
JERRY AMANTE, MAYOR
JOHN NIELSEN, MAYOR PRO TEM
DEBORAH GAVELLO
JIM PALMER
DOUG DAVERT
CITY OF TUSTIN
Comprehensive Annual Financial Report
For the Year Ended June 30, 2010
CITY OF TUSTIN
Comprehensive Annual Financial Report
June 30, 2010
Table of Contents
Introductory Section:
Page(.$)
Elected and Administrative Officials............................................................................................................. i
Letterof Transmittal.................................................................................................................................... iii
OrganizationChart ...................................................................................................................................... vii
GFOA Certificate of Achievement for Excellence in Financial Reporting ............................................... viii
Financial Section:
IndependentAuditor's Report ....................................................................................................................... 1
Management's Discussion and Analysis (Required Supplementary Information - Unaudited) ................... 3
Basic Financial Statements:
Government -wide Financial Statements:
Statementof Net Assets......................................................................................................................15
Statementof Activities........................................................................................................................16
Fund Financial Statements:
Governmental Funds:
BalanceSheet.............................................................................................................................18
Reconciliation of the Balance Sheet of Governmental Funds to the
Statementof Net Assets.............................................................................................................21
Statement of Revenues, Expenditures and Changes in
FundBalances............................................................................................................................ 22
Reconciliation of the Statement of Revenues, Expenditures and
Changes in Fund Balances of Governmental Funds to the Statement
ofActivities................................................................................................................................24
Proprietary Fund:
Statementof Net Assets.............................................................................................................25
Statement of Revenues, Expenses and Changes in Fund Net Assets........................................26
Statementof Cash Flows............................................................................................................27
Fiduciary Funds:
Statement of Fiduciary Assets and Liabilities.......................................................................... 29
Notes to Financial Statements.................................................................................................................... 31
CITY OF TUSTIN
Comprehensive Annual Financial Report
June 30, 2010
Table of Contents (Continued)
Page(s)
Required Supplementary Information (Unaudited):
Schedule of Funding Progress for PERS and Post—Employment Benefits .............................................. 67
Budgetary Comparison Schedule — General Fund.................................................................................... 68
Note to Required Supplementary Information.......................................................................................... 69
Supplementary Information:
Nonmajor Governmental Funds:
CombiningBalance Sheet.................................................................................................................. 76
Combining Statement of Revenues, Expenditures and Changes in Fund Balances .......................... 80
Budgetary Comparison Schedules — Nonmajor Special Revenue Funds:
GasTax Fund...................................................................................................................................... 84
MeasureM Fund................................................................................................................................. 85
Park Acquisition and Development Fund.......................................................................................... 86
AssetForfeiture Fund......................................................................................................................... 87
AirQuality Fund..................................................................:.............................................................. 88
Supplemental Law Enforcement Fund...............................................................................................89
Agency Funds:
Combining Statement of Assets and Liabilities................................................................................. 91
Combining Statement of Changes in Assets and Liabilities.............................................................. 92
Statistical Section (Unaudited):
Net Assets by Component — Last Six Fiscal Years...................................................................................98
Changes in Net Assets — Last Six Fiscal Years.......................................................................................100
Fund Balances of Governmental Funds — Last Six Fiscal Years............................................................104.
Changes in Fund Balances of Governmental Funds — Last Six Fiscal Years.........................................106
Assessed Value and Estimated Actual Values of Taxable Property — Last Ten Fiscal Years ...............108
Direct and Overlapping Property Tax Rates — Last Six Fiscal Years.....................................................110
Principal Property Tax Payers — Current and Nine Years Ago..............................................................112
Property Tax Levies and Collections — Last Seven Fiscal Years ...........................................................113
Ratios of Outstanding Debt by Type — Last Ten Fiscal Years................................................................114
Ratios of General Bonded Debt Outstanding — Last Ten Fiscal Years ..................................................116
OverlappingDebt Schedule.....................................................................................................................117
Legal Debt Margin Information — Last Ten Fiscal Years.......................................................................118
Pledged Revenue Coverage — Last Ten Fiscal Years..............................................................................122
Demographic and Economic Statistics — Last Ten Calendar Years .......................................................124
Principal Employers — Last Calendar Year.............................................................................................125
CITY OF TUSTIN
Comprehensive Annual Financial Report
June 30, 2010
Table of Contents (Continued)
Page(s)
Statistical Section (Unaudited) (Continued):
Full -Time City Employees by Function — Last Ten Fiscal Years ..........................................................126
Capital Asset Statistics by Function — Last Ten Fiscal Years.................................................................127
Water District Schedules for Revenue Capacity:
Water Consumption by Customer Type — Last Eight Fiscal Years.................................................128
Water Rates — Last Ten Fiscal Years...............................................................................................130
Water Customers — Current Year.....................................................................................................131
CITY OF TUSTIN
Elected and
Administrative Officials
MAYOR
Jerry Amante
CITY COUNCIL
John Nielsen, Mayor Pro Tem
Deborah Gavello
Jim Palmer
Doug Davert
AUDIT COMMISSION
R.Lawrence Friend, Chair
Craig Shimomura, Chair Pro Tem
Richard G. Hilde
Gregory C. Moore
Walter T. Sullens
CITY MANGER
William A. Huston
Douglas C. Holland
City Attorney
George W. Jeffries
City Treasurer
Elizabeth A. Binsack
Director,
Community Development
Pamela Arends-King
Director, Finance
Douglas S. Stack
Director,
Public Works/City Engineer
-i-
Pamela Stoker
City Clerk
Christine A. Shingleton
Assistant City Manager
Scott M. Jordan
Chief of Police
Kristi Recchia
Director, Human Resources
David Wilson
Director,
Parks and Recreation Services
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Finance Department
HONORABLE MAYOR AND MEMBERS OF THE CITY COUNCIL
CITIZENS OF THE CITY OF TUSTIN
City of Tustin
Tustin, California 92780
TUSTIN
BUILDING OUR FUTURE
HONORING OUR PAST
The Comprehensive Annual Financial Report (CAFR) of the City of Tustin for the fiscal year
ended June 30, 2010, is hereby submitted. These statements have been prepared in
conformity with generally accepted accounting principles (GAAP) and audited in accordance
with generally accepted auditing standards by an independent public accounting firm of licensed
certified public accountants.
The report consists of management's representations concerning the finances of the City of
Tustin. Responsibility for both the accuracy of the data, and the completeness and fairness of
the presentation, including all disclosures, rests with management. To provide a reasonable
basis for making these representations, management has established an internal control
framework that is designed both to protect the government's assets from loss, theft, or misuse
and to compile sufficient reliable information for the preparation of the financial statements in
conformity with GAAP. Because the cost of internal controls should not outweigh their benefits,
the City's framework of internal controls has been designed to provide reasonable rather than
absolute assurance that the financial statements will be free from material misstatement.
As management, we assert that, to the best of our knowledge and belief, the enclosed data is
accurate in all material respects and is reported in a manner designed to present fairly the
financial position and results of operations of the various funds and component units of the City
of Tustin. All disclosures necessary to enable the reader to gain an understanding of the City's
financial activities have been included.
The City of Tustin's financial statements for the year ended June 30, 2010, have been audited
by Macias Gini & O'Connell LLP, an independent public accounting firm of licensed certified
public accountants. The independent auditor concluded, based upon the audit, that there was a
reasonable basis for rendering an unqualified opinion that the City of Tustin's financial
statements for the fiscal year ended June 30, 2010, are fairly presented in conformity with
GAAP. The independent auditor's report is presented as the first component of the financial
section of this report.
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300 Centennial Way, Tustin, CA 92780 • P: (714) 573-3060 9 F: (714) 832-0825 0 www.tustinca.org
GAAP requires that management provide a narrative introduction, overview and analysis to
accompany the basic financial statements in the form of Management's Discussion and Analysis
(MD&A). This letter of transmittal is designed to complement the MD&A and should be read in
conjunction with it. The City of Tustin's MD&A can be found immediately following the report of
the independent auditors.
PROFILE OF THE CITY OF TUSTIN
The City of Tustin is located in the central part of Orange County, about forty miles southeast of
Los Angeles and eighty miles north of San Diego, at the intersection of the 5 and 55 Freeways.
Tustin covers over eleven square miles and adjoins the cities of Orange, Santa Ana and Irvine.
The State of California Department of Finance has certified the City's January 1, 2010 population
at 75,773 which represents a one percent increase from 2009.
The City was incorporated under the General Laws of the State of California in 1927 as the "City of
Tustin". Government was by a five member elected City Council. The Council/Administrator form
of city government was adopted in 1965 and was modified to the Council/Manager form in 1981.
Tustin is in the center of Orange County and, while surrounded by much of the County's main
industrial employment, it is essentially a residential community.
Tustin is a full service City. The services provided by the City include police, street and park
maintenance, water, recreation, traffic/transportation, public improvements, planning, zoning,
and general administrative services. The City contracts with the Orange County Fire Authority
for fire suppression services. Also included in the City's overall operations are the Tustin
Community Redevelopment Agency and the Tustin Public Financing Authority. Additional
information is available on these blended component units in the notes to the financial
statements.
The key element of the City's financial management process is the development and approval
of the annual budget. The City Council conducts various open budget workshops as necessary
and adopts the budget at a noticed public meeting. The budget is prepared pursuant to
generally accepted accounting principles (GAAP) and is balanced by fund. The level of
appropriations is controlled by the City Council for each fund. The City Manager is authorized to
transfer appropriations within the fund between the various programs and/or departments.
Budgetary control is maintained by a monthly financial reporting system. Budget to actual
comparisons are provided in this report for each individual governmental fund for which an
appropriated annual budget has been adopted. For the General Fund this comparison is
presented on page 68 as part of the required supplementary information and for nonmajor
governmental funds this comparison is presented on pages 84-89 as part of the other
supplementary information for the governmental funds.
ECONOMIC OUTLOOK
The State of California is still struggling with the economic downturn with a statewide
unemployment rate of 12.4% as of December 2010 and the unemployment rate in Orange
MW
County of 9.5% as of October 2010. The impact of the economic struggles in California and
nationwide has resulted in a decrease in sales tax revenue, which is the General Fund's largest
general fund revenue source. Annual Sales tax revenue went from $20.4 million in fiscal year
2007-2008 to $15.9 million in fiscal year 2009-2010, a 22% decline over three years. Property
tax revenue is the City's second largest revenue source. It has remained flat for the last two
fiscal years and is expected to drop 3% or $0.8 million in fiscal year 2010-2011. Commercial
and residential development has decreased significantly due to the recession. New
development at the Navy helicopter base has been put on hold except for construction that was
already planned. The City's agreement with the proposed development company, Tustin
Legacy Community Partners LLC, for the second large phase of development, ended August
2010 due to the current economic conditions. The City continues to pursue development for the
Navy Helicopter base area and throughout the City with a goal of enhancing diversity of the
economic base.
When it was apparent during fiscal year 2009/2010 that the sales tax revenue was going to be
significantly less than budgeted, Council and staff determined where cuts could be made
without impacting core services. As a result employees were laid off in areas that did not have
the workload to support the employees, many employees took early retirement, and a hiring
freeze was implemented. Taking this proactive position the City was able to maintain healthy
General Fund reserves.
The future economic outlook appears to be slowly changing in a positive direction for 2011. To
maintain General Fund reserves for fiscal year 2010/2011, the City cut expenditures no
employee raises and employees began contributing to their pension plans. City Council will be
reviewing the City's financial condition during the mid -year budget review in February 2011.
ACCOMPLISHMENTS AND FUTURE PROJECTS
During fiscal year 2009-2010, Kohl's department store and Sprouts grocery store located to the
City. The two businesses helped lessen the impact of the decline in sales tax revenue. Major
capital improvement projects completed were the Tustin Library and Citrus Ranch Park.
Despite the economic situation, the City's capital projects for fiscal year 2010-2011 are
budgeted at $32.1 million. Funding sources for the capital projects include revenues from gas
tax, Community Development Block Grant, water revenues, Redevelopment Agency tax
increment, Measure M, Park Development Funds, and Tax Allocation bond proceeds. Major
projects include the expansion of Tustin Ranch Road and the rehabilitation of the Rawlins water
reservoir.
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The Government Finance Officers Association of the United States and Canada (GFOA)
awarded a Certificate of Achievement for Excellence in Financial Reporting to the City of Tustin
for its Comprehensive Annual Financial Report for the fiscal year ended June 30, 2009. This
was the twenty-third 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 GFOA to determine its eligibility for another
certificate.
ACKNOWLEDGMENTS
I wish to express my appreciation to the entire Finance Department staff for their contribution to the
department during the year. Their efforts are reflected in this report and in other documents
resulting from the annual audit process. Special thanks are due to Jennifer Leisz, Accounting
Supervisor, Sean Tran, Senior Management Analyst, and the finance staff. Their significance in
preparing the final financial documents is reflected in the quality of this report.
The Mayor and members of the City Council are to be commended for their interest and support in
conducting the financial operations of the City in a responsible and progressive manner.
Respectfully submitted,
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Pamela Arends-King
Finance Director
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Certificate of
Achievement
for Excellence
in Financial
Reporting
Presented to
City of Tustin
California
For its Comprehensive Annual
Financial Report
for the Fiscal Year Ended
June 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
Executive Director
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The Honorable City Council of
the City of Tustin, California
Independent Auditor's Report
We have audited the accompanying financial statements of the governmental activities, the business -type
activities, each major fund, and the aggregate remaining fund information of the City of Tustin, California
(City), as of and for the year ended June 30, 2010, which collectively comprise the City's basic financial
statements as listed in the table of contents. These financial statements are the responsibility of the City'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 of
America 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. An audit includes 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 City'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, as well as 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, each major fund,
and the aggregate remaining fund information of the City of Tustin, California, as of June 30, 2010, and
the respective changes in financial position and, where applicable, cash flows thereof for the year then
ended in conformity with accounting principles generally accepted in the United States of America.
In accordance with Government Auditing Standards, we have also issued our report dated January 24,
2011 on our consideration of the City'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.
The management's discussion and analysis and other required supplementary information identified in the
accompanying table of contents, are not a required part of the basic financial statements but are
supplementary information required by accounting principles generally accepted in the United States of
America. 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.
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Our audit was conducted for the purpose of forming opinions on the financial statements that collectively
comprise the City's basic financial statements. The accompanying introductory section, the combining
and individual nonmajor fund financial statements and schedules listed as supplementary information in
the table of contents and statistical section are presented for purposes of additional analysis and are not a
required part of the basic financial statements. The combining and individual nonmajor fund financial
statements and schedules 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 and statistical sections 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.
Certified Public Accountants
Newport Beach, California
January 24, 2011
City of Tustin
Management's Discussion and Analysis (Unaudited)
June 30, 2010
As management of the City of Tustin, California (City), we offer readers of the City of Tustin's financial
statements this narrative overview and analysis of the financial activities of the City for the fiscal year
ended June 30, 2010. We encourage readers to consider the information presented here in conjunction
with additional information that we have furnished in our letter of transmittal, which can be found in the
introductory section of this report, and with the City's financial statements.
Financial Highlights
• The assets of the City exceeded its liabilities at June 30, 2010, by $637.5 million (net assets). Net
assets consist of $384.8 million invested in capital assets, net of related debt, $135.6 million in
restricted net assets and $117.1 million in unrestricted net assets.
• The government's total net assets increased by $1.7 million during the fiscal year ended
June 30, 2010. Revenues remained relatively flat from prior year; therefore, the increase in total
net assets is primarily due to cuts in expenses in governmental activities. Total unrestricted net
assets are $11.5 million higher than last fiscal year, an increase of 10%.
• As of June 30, 2010, the City's governmental funds reported combined ending fund balances of
$300.3 million, an increase of $19.4 million in comparison with the prior year. Approximately
29.7 percent of this total amount, $89.5 million, is available for spending at the government's
discretion (unreserved fund balance). This includes $76.1 million for Capital Projects; $14.3
million for Special Revenue funds and $5.9 million for the General Fund, offset by negative fund
balances of Debt Service funds of $6.8 million. The $5.9 million General Fund unreserved fund
balance is equivalent to 12% of total General Fund expenditures.
• The net decrease in the City's total long-term liabilities was $4.9 million. The $4.9 million net
decrease is primarily due to principal payoffs, a land acquisition settlement of $23.5 million, and
the issuance of 2010 Housing Tax Allocation bonds of $26.1 million.
Overview of the Financial Statements
This discussion and analysis is intended to serve as an introduction to the City's basic financial
statements. The City's basic financial statements consist of three components: 1) government -wide
financial statements, 2) fund financial statements, and 3) notes to the basic financial statements. This
report also contains required supplementary and other supplementary information in addition to the basic
financial statements themselves.
CITY OF TUSTIN
Management's Discussion and Analysis (Unaudited)
June 30, 2010
Government -wide financial statements
The government -wide financial statements are designed to provide readers with a broad overview of the
City's finances, in a manner similar to a private -sector business.
The statement of net assets presents information on all of the City's assets and liabilities, with the
difference between the two reported as net assets. Over time, increases in the net assets may serve as a
useful indicator of whether the financial position of the City is improving or deteriorating.
The statement of activities presents information showing how the government's net assets changed during
the most recent fiscal year. All changes in net assets are reported as soon as the underlying event giving
rise to the change occurs, regardless of the timing of related cashflows. Thus, revenues and expenses are
reported in this statement for some items that will only result in cash flows in future fiscal periods (e.g.,
uncollected taxes and earned but unused vacation leave).
Government -wide financial statements distinguish City governmental activities that are principally
supported by taxes and intergovernmental revenues from other business -type activities that are intended
to recover all or a significant portion of their costs through user fees and charges. Governmental activities
of the City, the Tustin Redevelopment Agency, a blended component unit, and the Public Financing
Authority, a blended component unit, include general government, public safety, community services and
public works. Business -type activities of the City include the Water Utility and Tustin Legacy (ceased
operations in fiscal year 2009.)
The government -wide financial statements can be found immediately following this discussion and
analysis.
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. The City, like other state and local governments, uses
fund accounting to ensure and demonstrate compliance with finance -related legal requirements. All of
the funds of the City can be divided into three categories: governmental funds, proprietary funds, and
fiduciary funds.
Governmental funds. Governmental funds are used to account for essentially the same functions reported
as governmental activities in the government -wide financial statements. However, unlike the
government -wide financial statements, governmental fund financial statements focus on near-term
inflows and outflows of spendable resources, as well as on balances of spendable resources available at
the end of the fiscal year. Such information may be useful in evaluating a government's near-term
financing requirements.
Because the focus of governmental funds is narrower than that of the government -wide financial
statements, it is useful to compare the information presented for governmental funds with similar
information presented for governmental activities in the government -wide financial statements. By doing
so, readers may better understand the long-term impact of the government's near-term financing
decisions. Both the Governmental Funds Balance Sheet and the Governmental Funds Statement of
Revenues, Expenditures, and Changes in Fund Balances provide a reconciliation to facilitate this
comparison between governmental funds and governmental activities.
CITY OF TUSTIN
Management's Discussion and Analysis (Unaudited)
June 30, 2010
Fund financial statements (Continued)
The City maintains various individual governmental funds organized by their type (special revenue, debt
service and capital projects funds). Information is presented separately in the Governmental
Funds Balance Sheet, the Governmental Funds Statement of Revenues, Expenditures, and Changes in
Fund Balances. The General Fund, the CFD Construction Capital Projects Fund, the Marine Base Project
Area Debt Service Fund, and the South Central Project Area Debt Service Fund are considered to be
major funds. Data from other governmental funds are combined into a single, aggregated presentation.
Individual fund data for each of these nonmajor governmental funds is provided in the form of combining
statements elsewhere in this report.
The City adopts an annual appropriated budget for its General Fund and the special revenue funds to
demonstrate compliance with the annual budget. Budgetary comparison schedules have been provided to
demonstrate compliance with this budget elsewhere in this report.
The governmental funds financial statements can be found immediately following the government -wide
financial statements.
Proprietary funds. The City of Tustin maintains one type of proprietary (Enterprise) fund. This
enterprise fund is used to report the same functions presented as business -type activities in the
government -wide financial statements. The City uses an enterprise fund to account for its Water Utility.
The proprietary fund financial statements can be found immediately following the governmental funds
financial statements.
Fiduciaryfunds. Fiduciary funds are used to account for resources held for the benefit of parties outside
the government. Fiduciary funds are not reflected in the government -wide financial statement, because
the resources of those funds are not available to support the City's own programs. The fiduciary hinds
financial statements can be found immediately following the proprietary fund financial statements.
Notes to the basic financial statements
The notes to the basic financial statements 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 basic financial statements can be found immediately following the fiduciary funds financial
statements.
Other information
In addition to the basic financial statements and accompanying notes, this report also presents certain
required supplementary information which includes a Budgetary Comparison Schedule for the General
Fund and schedules of funding progress for the City's defined benefit pension plan and other
postemployment healthcare benefits plan. Required supplementary information can be found
immediately following the notes to the basic financial statements.
CITY OF TUSTIN
Management's Discussion and Analysis (Unaudited)
June 30, 2010
The combining statements referred to earlier in connection with nonmajor governmental funds are
presented for all nonmajor Special Revenue Funds, nonmajor Capital Projects Funds, and all nonmajor
Debt Service Funds. These combining and individual fund statements and schedules can be found
immediately following the required supplementary information.
Government -wide Financial Analysis
The government -wide financial statements provide long-term and short-term information about the City's
overall financial condition. This analysis addresses the financial statements of the City as a whole.
The largest portion of the City's net assets (66 percent) reflects its investment in capital assets e.g., land,
buildings, improvements other than buildings, equipment, infrastructure, and construction in progress,
less any related debt used to acquire those assets that is still outstanding. The City uses these capital
assets to provide services to citizens; consequently, these assets are not available for future spending.
Although the City's investment in its capital assets is reported net of related debt, it should be noted that
the resources needed to repay this debt must be provided from other sources, since the capital assets
themselves cannot be used to liquidate these liabilities.
City of Tustin
Summary of Net Assets
As of June 30, 2010
(in millions of dollars)
Governmental
Business -Type
Total
Activities
Activities
Total
% Change
2009
2010
2009
2010
2009
2010
2009-2010
Assets:
Current and other assets
$330.0
$319.9
$5.4
$5.4
$335.4
$325.3
Capital assets
358.6
360.3
36.8
35.1
395.4
395.4
Total Assets
688.6
680.2
42.2
40.5
730.8
720.7
(1.4%)
Liabilities:
Current liabilities
24.1
17.0
2.0
2.2
26.1
19.2
Non -Current liabilities
56.3
52.1
12.5
11.9
68.8
64.0
Total Liabilities
80.4
69.1
14.5
14.1
94.9
83.2
(13%)
Net Assets:
Invested in capital assets,
net of related debt
358.6
360.3
25.8
24.5
384.3
384.9
Restricted
145.7
135.6
-
-
145.7
135.6
Unrestricted
103.9
115.2
1_9
1_9
105.8
117.1
11%
Total Net Assets
$608.2
$611.1
$27.7
$26.4
$635.8
$637.5
0.3%
CITY OF TUSTIN
Management's Discussion and Analysis (Unaudited)
June 30, 2010
Governmental activities. Net assets of the City's governmental activities increased 0.5 % to $611.1
million, of which $360.3 million is invested in capital assets such as equipment, buildings and
infrastructure, net of related debt. Of the remaining total, $135.6 million is restricted to specifically
stipulated spending agreements originated by law, contract or other agreements with external parties.
Government -wide Financial Analysis (Continued)
The remaining $115.2 million is subject to designation for specific purposes as approved by the City
Council, and may be used to meet the
City's ongoing obligations.
City of Tustin
Summary of Changes in Net Assets
For the Year Ended June 30, 2010
(in millions of dollars)
Governmental Business -Type
Total
Activities Activities
Total
% Change
2009 2010 2009 2010
2009
2010
2009-2010
Revenues:
Program revenues:
Charges for services
$8.5 $7.3 $11.3 $10.6
$19.8
$17.9
Operating grants & contributions
4.3 3.4 - -
4.3
3.4
Capital grants and contributions
18.8 6.7 - -
18.8
6.7
General revenues:
Taxes
30.6 30.6 - -
30.6
30.6
Sales taxes shared state revenues
19.8 15.9 - -
19.8
15.9
Motor vehicle taxes
5.9 6.1 - -
5.9
6.1
Earnings on investments
4.9 4.1 0.2 .1
5.1
4.2
Miscellaneous
2.3 1.5 0.1 -
2.4
1.5
Total Revenues
95.1 75.6 11.6 10.7
106.7
86.3
(19%)
Expenses:
General government
8.6 7.8 - -
8.6
7.8
Public safety
29.1 27.3 - -
29.1
27.3
Public works
22.1 20.8 - -
22.1
20.8
Community services
5.1 12.7 - -
5.1
12.7
Interest on long-term debt
3.6 4.1 - -
3.6
4.1
Water
- - 12.5 11.9
12.5
11.9
Tustin Legacy
= - 1_3 -
13
Total Expenses
68.5 72.7 14.4 11.9
82.9
84.6
2.1%
Change in net assets before transfers
26.6 2.9 (2.8) (1.2)
23.8
1.7
Transfers
103.8 -(103.8)
Increase in net assets
130.4 2.9 (106.6) (1.2)
23.8
1.7
Net Assets - Beginning, restated
477.8 608.2 134.2 27.6
612.0
635.8
Net Assets - Ending
$ $611.1 $27.7 $26.4
$635.8
$637.5
0.3%
CITY OF TUSTIN
Management's Discussion and Analysis (Unaudited)
June 30, 2010
Government -wide Financial Analysis (Continued)
Governmental activities increased the net assets by $2.9 million. The primary reason for this increase in
net assets is due to the decrease in city-wide expenses. Due to the recession, revenues were expected to
decrease so expenses were cut to accommodate the forecasted shortfall in revenues.
Overall, revenues decreased $20.4 million from prior year. Capital grants and contributions program
revenues decreased $12.1 from prior year due to the timing of spending funds on Capital Projects that are
reimbursed by grant funds. Those funds will be earned when eligible expenditures are incurred in fiscal
year 2011. Charges for services decreased $1.9 million due to the decrease in water consumption and
decrease in building and development because of current economic conditions. Sales taxes decreased
$3.9 million primarily due to the downturn in the economy. Investment earnings decreased because of
low interest rates. Earnings on the City's investment portfolio averaged less than 1 %. General
government, Public safety, Public works and Interest on long-term debt expenses decreased from prior
year $3.4 million. Those expense cuts were due to employee layoffs, a hiring freeze, and eliminating
and/or delaying other operating costs. Community services expenses increased $7.6 primarily due to the
Redevelopment Agency's California State mandated Education Augmentation Relief Fund contribution of
$6.2 million.
Business -Type activities net assets decrease of $1.2 million is primarily due to the inadequate water rate
structure that does not cover the increase in productions costs, such as purchase of water from third party
agencies and increases in utility costs.
Financial Analysis of the Government's Funds
As noted earlier, the City uses fund accounting to ensure and demonstrate compliance with finance -
related legal requirements.
The focus of the City's governmental funds is to provide information on near-term inflows, outflows, and
balances of spendable resources. Such information may be useful in assessing the City's financing
requirements.
As of the end of the current fiscal year, the City's governmental funds reported total combined ending
fund balances of $300.3 million, an increase of $19.4 million in comparison with the prior year.
Approximately $89.5 million (30%) of this total amount constitutes unreserved fund balance, which is
available for spending at the government's direction. The remainder of fund balance, $210.8 million, is
reserved to indicate that it is not available for new spending, because it has already been committed to:
1) advances to other funds ($21.0 million), 2) prepaid items and deposits ($.1 million), 3) land held for
resale ($170.4 million), and 4) for low income housing ($19.3 million).
The General Fund is the chief operating fund of the City. At the end of the current fiscal year, unreserved
fund balance of the General Fund was $5.8 million, while total fund balance was $150.0 million. As a
measure of the General Fund's liquidity, it may be useful to compare unreserved fund balance to total
fund expenditures. Unreserved fund balance represents 12.2 percent of the total General Fund
expenditures.
CITY OF TUSTIN
Management's Discussion and Analysis (Unaudited)
June 30, 2010
City of Tustin
Summary of Changes in Fund Balances - General Fund
For the Year Ended June 30, 2010
(in millions of dollars)
Expenditures:
General government
6.6
7.1
Total
27.6
26.3
Public works
%Change
10.1
2009
2010
2009-2010
Revenues:
1.7
1.0
Interest and fiscal charges
Taxes
$36.9
$33.9
50.0
Charges for services
4.4
5.7
Intergovernmental
1.8
1.3
Net Transfers
Investment revenue
2.5
2.3
$98.2
Licenses and permits
1.6
0.4
Other
1_6
1_8
Total Revenues
48.8
45.4
(7.0%)
Expenditures:
General government
6.6
7.1
Public safety
27.6
26.3
Public works
11.1
10.1
Community services
3.0
2.7
Capital outlay
1.7
1.0
Interest and fiscal charges
_
.8
Total Expenses
50.0
48.0 (4.0%)
Excess of Revenues Over
(Under) Expenditures
(1.2)
(2.6)
Net Transfers
99.4
28.5
Net Increase in Fund Balance
$98.2
$25.9 (73.6%)
Transactions impacting revenues in the General Fund were as follows:
• Sales tax revenues were $15.7 million reflecting a $4.1 million decrease from prior year due to
the recession that significantly impacted consumer spending.
• Charges for services increased $1.3 million due to collection of past due administrative fees for
managing the community facility districts.
• Licenses and permits revenues decreased approximately $1.2 million due to the slowdown of
construction because of the recession.
CITY OF TUSTIN
Management's Discussion and Analysis (Unaudited)
June 30, 2010
Financial Analysis of the Government's Funds (Continued)
• Net transfers for 2009 were related to a $101 million transfer of Land Held for Resale. Net
transfers for 2010 of $28.5 million are primarily due to a transfer from the Redevelopment
Agency for reimbursement of an agreement between the Agency and the City in relation to
low/moderate housing activities. The $28.5 million net transfer is the primary reason for the
increase in fund balance.
Changes in General Fund expenditures from previous fiscal year, by function, occurred as follows during
the year ended June 30, 2010:
• Public safety and public works expenditures decreased $1.3 million and 1.0 million, respectively,
due to a hiring freeze, employee layoffs during the fiscal year, and cutting operating costs.
• Capital outlay decreased $0.7 million due to the elimination and or delay of capital projects
because of the decrease in revenues.
CFD Construction Capital Projects Fund unreserved fund balance decreased $1.3 million due to
construction of infrastructure in the Tustin Legacy area.
The Marine Base Project Area Debt Service Fund expenditures exceeded revenues $2.9 million due to the
California State mandate Educational Augmentation Fund Relief payment of $2.8 million.
The South Central Project Area Debt Service fund revenues exceeded expenditures $1.2 million.
Community Services expenditures increased $1.6 million due to the California State mandate Educational
Augmentation Fund Relief payment.
General Fund Budgetary Highlights
Differences between the General Fund actual revenues and transfers and amended budgeted revenues and
transfers were $23.1 million primarily due to the transfer of funds from the Agency to the General Fund
for reimbursement of an agreement between the Agency and the City in relation to low/moderate housing
activities. Actual General Fund expenditures were less than the amended budgeted amount of $51.4
million by $3.4 million.
Financial Analysis of the Proprietary Fund
The City has one proprietary fund which is the Water Enterprise Fund. Unrestricted net assets of the
Water Enterprise are $1.9 million. The change in net assets was ($1.2) million. The decrease in net assets
is because the water rate structure has not met the increases in operating costs over the past few years.
New water rates were approved June 15, 2010 that became effective July 1, 2010. The new water rate
structure will eliminate the operating deficit and provide enough revenue to build reserves and provide
funds for outstanding water infrastructure rehabilitation.
CITY OF TUSTIN
Management's Discussion and Analysis (Unaudited)
June 30, 2010
Capital Asset and Debt Administration
Capital Assets
The City's investment in capital assets for its governmental and business -type activities as of
June 30, 2010 amounts to $395.4 million, net of accumulated depreciation. This investment in capital
assets includes land, buildings and system improvements, machinery and equipment, park facilities,
roads, highways, and bridges.
City of Tustin
Summary of Changes in Capital Assets
For the Year Ended June 30, 2010
(in millions of dollars)
The major activity affecting capital assets this year was the completion of the Tustin Library and Citrus
Ranch Park.
Additional information on the City's capital assets can be found in the notes to the basic financial
statements section of this report (beginning on page 48).
Long-term Debt
At the end of the current fiscal year, the City had total long-term liabilities outstanding of $64.0 million.
Of this amount, $56 million are secured solely by specified revenue sources such as property tax
increment and water service charges.
Governmental
Business -Type
Total
Activities
Activities
Total
%Change
2009
2010
2009
2010
2009
2010
2008-2010
Land
$19.3
$19.3
$1.2
$1.2
$20.5
$20.5
Right of way
41.9
42.4
-
-
41.9
42.4
Construction in progress
47.8
31.8
2.5
1.1
50.3
32.9
Buildings and improvements
30.5
52.1
6.2
5.9
36.7
58.0
Machinery and equipment
3.4
2.5
-
-
3.4
2.5
Infrastructure
215.7
212.2
-
-
215.7
212.2
Property, plant and equipment
-
_
26.9
26.9
26.9
26.9
Total Capital Assets, Net
$358.6
$360.3
$36.8
$35.1
$395.4
$395.4
0.0%
The major activity affecting capital assets this year was the completion of the Tustin Library and Citrus
Ranch Park.
Additional information on the City's capital assets can be found in the notes to the basic financial
statements section of this report (beginning on page 48).
Long-term Debt
At the end of the current fiscal year, the City had total long-term liabilities outstanding of $64.0 million.
Of this amount, $56 million are secured solely by specified revenue sources such as property tax
increment and water service charges.
CITY OF TUSTIN
Management's Discussion and Analysis (Unaudited)
June 30, 2010
Capital Asset and Debt Administration (Continued)
City of Tustin
Summary of Changes in Long -Term Liabilities
For the Year Ended June 30, 2010
(in millions of dollars)
Tax allocation bonds
Notes payable
Bonds payable
Land acquisition settlement
Claims and judgments
Postemployment
benefits obligation
Compensated absences
Total Outstanding Debt
Governmental Business -Type
Activities Activities
2009 2010 2009 2010
$10.9 $36.0 $- $-
15.0 8.2 - -
12.4
23.5 - -
1.9 2.2 -
1.7 2.5 -
3.3 3_2 02
11.7
Total
Total % Change
2009 2010 2009-2010
$10.9 $36.0
15.0 8.2
12.4 11.7
23.5 -
1.9 2.2
- 1.7 2.5
0_2 3_5 3_4
$56.3 $52.1 $12.6 $11.968.9 $64.0 (7.1%)
The City's long-term debt decreased $4.9 million from prior year as a result of the following transactions.
Total payments to reduce long-term obligations were $35.2 million, which included the payoff of the land
acquisition settlement of $23.5 million. The City issued 2010 Housing Tax Allocation bonds of $26.1
million in March 2010 to finance low and moderate income housing activities throughout the geographic
boundaries of the City, and to repay a reimbursement obligation from the Agency to the City relating to
affordable housing purposes.
Additional information on the City's long-term debt can be found in the notes to the basic financial
statements section of this report starting on page 50.
Economic Factors and Next Year's Budget and Rates
• The unemployment rate for Orange County, California area was 9.5% as of October 2010. This
is a 0.1 % decrease from October 2009.
• During the recession, the local economy was significantly impacted by the decline in the financial
services and construction sectors. The decline of these industries and the lack for financing being
available to consumers has resulted in a decline in sales tax revenues, hotel tax revenues, property
values and economic development.
• The City's sales tax revenues declined $4.1 million and are expected to remain flat for fiscal year
2010-2011. Property tax revenues remained flat and are expected to decline at least 3% or $0.8
million in fiscal year 2010-2011.
CITY OF TUSTIN
Management's Discussion and Analysis (Unaudited)
June 30, 2010
Economic Factors and Next Year's Budget and Rates (Continued)
The City Council adopted the fiscal year 2010-2011 Budget with total appropriations of $137.9 million.
The General Fund fiscal year 2010-2011 budgeted appropriations are $48.1 million. This reflects a
decrease in appropriations of $3.4 million due to the decline of ongoing revenues such as sales tax and
charges for services as a result of the recession. Due to the critical economic conditions the City Council
will be reviewing the City's financial condition February 2011.
Requests for Information
This financial report is designed to provide a general overview of the City's finances for all those with an
interest in the government's finances. Questions concerning any of the information provided in this
report or requests for additional financial information should be addressed to the Finance Director, City of
Tustin, 300 Centennial Way, Tustin, California, 92780.
This page left blank intentionally.
CITY OF TUSTIN
Statement of Net Assets
June 30, 2010
Assets:
Cash and investments
Receivables:
Accounts receivable
Interest receivable
Loans receivable
Due from other governments
Allowance for uncollectibles
Internal balances
Prepaid expenses and deposits
Land held for resale
Deferred bond issuance costs
Restricted assets:
Cash and investments with fiscal agents
Capital assets:
Not being depreciated
Being depreciated, net
Total assets
Liabilities:
Accounts payable and accrued liabilities
Interest payable
Deposits payable
Unearned revenue
Long-term liabilities:
Due within one year
Due in more than one year
Total liabilities
Net assets:
Invested in capital assets, net of related debt
Restricted for:
Community services
Public safety
Public works
Debt service
Unrestricted
Total net assets
Governmental
Activities
Business -type
Activities Total
$ 94,574,297 $ 4,373,268 $ 98,947,565
5,405,756
297,564
1,094,306
425,660
(720,342)
2,141,191
105,700
170,416,850
889,524
45,351,583
93,514,379
266,768,313
680,264,781
7,234,530
418,467
8,266,469
1,112,274
15,758,199
36,311,626
69,101,565
360,282,692
19,251,025
101,376
104,210,394
12,107,507
115,210,222
$ 611,163,216
See Accompanying Notes to Financial Statements.
1,923,383
13,624
(2,141,191)
1,060
93,509
1,191,691
2,323,373
32,753,856
40,532,573
1,808,982
125,676
270,493
896,152
11,038,491
14,139,794
24,541,113
1,851,666
$ 26,392,779
7,329,139
311,188
1,094,306
425,660
(720,342)
106,760
170,416,850
983,033
46,543,274
95,837,752
299,522,169
720,797,354
9,043,512
544,143
8,536,962
1,112,274
16,654,351
47,350,117
83,241,359
384,823,805
19,251,025
101,376
104,210,394
12,107,507
117,061,888
$ 637,555,995
CITY OF TOSTIN
Statement of Activities
For the Year Ended June 30, 2010
General revenues:
Taxes:
Property taxes
Franchise taxes
Transient occupancy taxes
Business license taxes
Sales taxes shared state revenues
Motor vehicle taxes shared state revenues
Earning on investments
Miscellaneous
Total general revenues
Changes in net assets
Net assets, beginning, as restated
Net assets, ending
See Accompanying Notes to Financial Statements.
Program Revenues
Operating
Charges for
Grants and
Functions/Programs
Expenses
Services
Contributions
Governmental activities:
General government
$ 7,802,579
$ 1,404,925
$ 158,902
Public safety
27,277,141
1,168,348
372,707
Public works
20,816,686
3,761,321
2,224,714
Community services
12,742,391
957,545
647,088
Interest on long-term debt
4,087,839
-
-
Total governmental activities
72,726,636
7,292,139
3,403,411
Business -type activities:
Water
11,938,146
10,594,471
-
Total business -type activities
11,938,146
10,594,471
-
Total
$ 84,664,782
$ 17,886,610
$ 3,403,411
General revenues:
Taxes:
Property taxes
Franchise taxes
Transient occupancy taxes
Business license taxes
Sales taxes shared state revenues
Motor vehicle taxes shared state revenues
Earning on investments
Miscellaneous
Total general revenues
Changes in net assets
Net assets, beginning, as restated
Net assets, ending
See Accompanying Notes to Financial Statements.
Program Net (Expense) and
Revenues Changes in Net Assets
Capital
(1,343,675)
Grants and
Governmental
Contributions
Activities
$ -
$ (6,238,752)
-
(25,736,086)
6,715,593
(8,115,058)
44,811
(11,092,947)
-
(4,087,839)
6,760,404
(55,270,682)
$ 6,760,404
(55,270,682)
Business -type
Activities
Total
$ (6,238,752)
(25,736,086)
(8,115,058)
(11,092,947)
(4,087,839)
(55,270,682)
(1,343,675)
(1,343,675)
(1,343,675)
(1,343,675)
(1,343,675)
(56,614,357)
28,347,659
-
28,347,659
1,720,505
-
1,720,505
141,335
-
141,335
337,867
-
337,867
15,917,332
-
15,917,332
6,122,789
-
6,122,789
4,086,852
86,654
4,173,506
1,520,662
25,340
1,546,002
58,195,001
111,994
58,306,995
2,924,319
(1,231,681)
1,692,638
608,238,897
27,624,460
635,863,357
$ 611,163,216 $ 26,392,779 $ 637,555,995
Assets:
Cash and investments
Cash and investments with fiscal agents
Receivables:
Accounts receivable
Interest receivable
Loans receivable
Due from other governments
Allowance for uncollectibles
Due from other funds
Advances to other funds
Prepaid items and deposits
Land held for resale
Total assets
Liabilities:
Accounts payable and accrued liabilities
Due to other funds
Advances from other funds
Deposits payable
Deferred revenue
Total liabilities
Fund balances:
Reserved for:
Advances to other funds
Prepaid items and deposits
Land held for resale
Low and moderate income housing
Unreserved reported in:
General fund
Special revenue funds
Debt service funds
Capital projects funds
Total fund balances
Total liabilities and fund balances
CITY OF TUSTIN
Balance Sheet
Governmental Funds
June 30, 2010
General
CFD
Construction
Capital Projects
Fund
Marine Base
Project Area
Debt Service
Fund
$ 24,965,465 $ - $ -
- 37,914,325 -
3,092,958 - 193,309
53,657 - -
425,660 - -
9,975,752 - -
- - 6,704,151
67,317 - -
144,071,850 - -
$ 182,652,659 $ 37,914,325 $ 6,897,460
$ 4,213,971 $ 20,802 $ 2,266,581
- 793,233 4,516,411
20,112,456 - -
8,200,141 - -
115,932 - 410,235
32,642,500 814,035 7,193,227
- - 6,293,916
67,317 - -
144,071,850 - -
5,870,992 - -
- (6,589,683)
- 37,100,290 -
150,010,159 37,100,290 (295,767)
$ 182,652,659 $ 37,914,325 $ 6,897,460
See Accompanying Notes to Financial Statements.
South Central
Project Area
Nonmajor
Total
Debt Service
Governmental
Governmental
Fund
Funds
Funds
$
2,636,638
$
66,972,194
$
94,574,297
-
7,437,258
45,351,583
106,932
2,012,557
5,405,756
8,213
235,694
297,564
-
1,094,306
1,094,306
-
-
425,660
-
(720,342)
(720,342)
-
-
9,975,752
6,704,153
8,845,343
22,253,647
-
38,383
105,700
-
26,345,000
170,416,850
$
9,455,936
$
112,260,393
$
349,180,773
$
2,674
$
730,502
$
7,234,530
4,650,000
16,108
9,975,752
-
-
20,112,456
-
66,328
8,266,469
414,737
2,391,539
3,332,443
5,067,411
3,204,477
48,921,650
6,293,918
8,417,355
21,005,189
-
38,383
105,700
-
26,345,000
170,416,850
-
19,220,695
19,220,695
-
-
5,870,992
-
14,277,683
14,277,683
(1,905,393)
1,720,831
(6,774,245)
-
39,035,969
76,136,259
4,388,525
109,055,916
300,259,123
$
9,455,936
$
112,260,393
$
349,180,773
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CITY OF TUSTIN
Reconciliation of the Balance Sheet of Governmental Funds
to the Statement of Net Assets
June 30, 2010
Fund balances for governmental funds $ 300,259,123
Amounts reported for governmental activities in the Statement of Net Assets
are different because:
Capital assets net of depreciation have not been included as financial
resources in governmental funds. 360,282,692
Long-term debt, post employment benefits obligation, and compensated
absences have not been included in the governmental funds.
Tax allocation bonds $ (35,890,000)
Notes payable (8,199,000)
Claims and judgments payable (2,240,963)
Compensated absences (3,175,818)
Postemployment benefits obligation (2,461,016)
Unamortized bond premium (104,205)
Amortization of bond premium 1,177 (52,069,825)
Accrued interest payable for the current portion of interest due on long-
term debt has not been reported in the governmental funds. (418,467)
Bond issuance costs are not deferred and amortized in governmental funds,
but rather are recorded as an expenditure. 889,524
Certain revenues in the governmental funds are deferred because they are
not collected within the prescribed time period after year-end.
Therefore, they are revenue on the accrual basis used in the 2,220,169
government -wide statements.
Net assets of governmental activities
See Accompanying Notes to Financial Statements.
$ 611,163,216
CITY OF TUSTIN
Statement of Revenues, Expenditures and Changes in Fund Balances
Governmental Funds
For the Year Ended June 30, 2010
Revenues:
Taxes
Licenses and permits
Fines and forfeitures
Use of money and property
Intergovernmental revenue
Charges for services
Rental income
Developer contribution
Other revenue
Total revenues
Expenditures:
Current:
General government
Public safety
Public works
Community services
Capital outlay
Debt service:
Principal retirement
Interest and fiscal charges
Total expenditures
Excess of revenues over
(under) expenditures
Other financing sources (uses):
Transfers in
Transfers out
Sale of property
Premium on bonds
Bond proceeds
Total other financing sources (uses)
Net changes in fund balances
Fund balances, beginning
Fund balances (deficits), ending
See Accompanying Notes to Financial Statements.
CFD
Marine Base
Construction
Project Area
Capital Projects
Debt Service
General
Fund
Fund
$ 33,891,993
$ -
$ 7,106,272
397,896
-
-
890,770
-
-
2,278,358
5,881
-
1,274,795
-
-
5,746,442
-
385,358
555,149
-
-
45,420,761
5,881
7,106,2 72
7,152,834
-
-
26,247,277
-
-
10,133,685
-
-
2,680,082
-
3,036,457
1,014,385
1,393,052
-
-
-
6,763,000
828,285
-
219,798
48,056,548
1,3 93,052
10,019,255
(2,635,787)
(1,387,171)
(2,912,983)
28,482,712
-
2,617,216
7,421
-
-
28,490,133
2,617,216
-
25,854,346
(1,387,171)
(295,767)
124,155,813
38,487,461
-
$ 150,010,159
$ 37,100,290
$ (295,767)
South Central
37,207,661
- (37,207,661)
Project Area
Nonmajor
Total
Debt Service
Governmental
Governmental
Fund
Funds
Funds
1,166,963 (5,925,151)
19,413,220
3,221,562 114,981,067
$ 3,496,027
$ 8,085,237
$ 52,579,529
-
-
397,896
-
-
890,770
-
914,245
3,198,484
-
4,576,808
5,851,603
-
102,565
5,849,007
-
484,287
869,645
-
4,051,180
4,051,180
-
473,283
1,028,432
3,496,027
18,687,605
74,716,546
-
44,875
7,197,709
-
112,158
26,359,435
-
-
10,133,685
2,282,799
4,252,141
12,251,479
-
10,718,546
13,125,983
-
1,150,000
7,913,000
46,265
3,509,313
4,603,661
2,329,064
19,787,033
81,584,952
1,166,963 (1,099,428) (6,868,406)
- 6,107,733
37,207,661
- (37,207,661)
(37,207,661)
- -
7,421
- 104,205
104,205
- 26,170,000
26,170,000
- (4,825,723)
26,281,626
1,166,963 (5,925,151)
19,413,220
3,221,562 114,981,067
280,845,903
$ 4,388,525 $ 109,055,916 $ 300,259,123
CITY OF TUSTIN
Reconciliation of the Statement of Revenues, Expenditures and Changes in
Fund Balances of Governmental Funds to the Statement of Activities
For the Year Ended June 30, 2010
Net changes in fund balances - total governmental funds $ 19,413,220
Amounts reported for governmental activities in the Statement of Activities
are different because:
Governmental funds report capital outlays as expenditures. However, in
the Statement of Activities, the cost of those assets is allocated over
the estimated useful lives as depreciation expense. This is the amount
by which capital expenditures exceeded depreciation and disposition
of capital assets in the current period.
Capital expenditures $ 10,825,152
Capital contribution 350,013
Disposition of capital assets (382,315)
Depreciation expense (9,109,262) 1,683,588
The issuance of long-term debt provides current financial resources to
governmental funds, while the repayment of the principal of long -debt
and changes in other long-term liabilities affects the current financial
resources of governmental funds. Neither transaction, however, has
any effect on net assets. This amount is the net effect of these
differences in the treatment of long-term liabilities.
Bond issuance $ (26,170,000)
Unamortized premium (104,205)
Amortization of bond premium 1,177
Principal payments 7,913,000
Land acquisition settlement 23,500,000
Claims and judgments payable (301,043)
Accrued postemployment benefits obligation (761,365)
Compensated absences 150,906
4,228,470
Issuance costs on long-term debt is not deferred and amortized in the
current period and, therefore, is reported as interest expense in the
governmental funds.
889,524
To record land held for resale as a financial resource due to settlement of
claim. This asset was accrued in Statement of Net Assets in the
(23,500,000)
previous year.
Some revenues reported in the Statement of Activities are not considered
to be available to finance current expenditures and therefore are not
reported as revenues in the governmental funds.
Net change in deferred revenues
584,396
Some expenses reported in the Statement of Activities do not require the
use of current financial resources and therefore are not reported as
expenditures in the governmental funds.
Net change in accrued interest payable on long-term liabilities
(374,879)
Change in net assets of governmental activities
$ 2,924,319
See Accompanying Notes to Financial Statements.
CITY OF TUSTIN
Statement of Net Assets
Proprietary Fund
June 30, 2010
Noncurrent assets:
Restricted cash and investments with fiscal agents
Business -type
Deferred bond issuance costs
Activities
Capital assets:
Water
Not being depreciated
Enterprise Fund
Assets:
32,753,856
Current assets:
36,362,429
Cash and investments
$ 4,373,268
Accounts receivable
1,923,383
Interest receivable
13,624
Prepaid expenses
1,060
Total current assets
6,311,335
Noncurrent assets:
Restricted cash and investments with fiscal agents
1,191,691
Deferred bond issuance costs
93,509
Capital assets:
1,808,982
Not being depreciated
2,323,373
Being depreciated, net
32,753,856
Total noncurrent assets
36,362,429
Total assets
42,673,764
Liabilities:
Current liabilities:
Accounts payable and accrued liabilities
1,808,982
Advances from other funds
2,141,191
Deposits payable
270,493
Compensated absences
186,152
Interest payable
125,676
Bonds payable
710,000
Total current liabilities
5,242,494
Noncurrent liabilities:
Compensated absences
20,684
Bonds payable
11,017,807
Total noncurrent liabilities
11,038,491
Total liabilities
16,280,985
Net assets:
Invested in capital assets, net of related debt
24,541,113
Unrestricted
1,851,666
Total net assets
$ 26,392,779
See Accompanying Notes to Financial Statements.
CITY OF TUSTIN
Statement of Revenues, Expenses and Changes in Fund Net Assets
Proprietary Fund
For the Year Ended June 30, 2010
Operating revenues:
Charges for services
Operating expenses:
Personnel services
Purchased water and power
Maintenance and operation
Depreciation and amortization
Total operating expenses
Operating (loss)
Nonoperating revenues (expenses):
Interest income
Other income
Interest expense
Loss on sale of assets
Total nonoperating
revenues (expenses)
Change in net assets
Total net assets, beginning, as restated
Total net assets, ending
See Accompanying Notes to Financial Statements.
Ir
Business -type
Activities
Water
Enterprise Fund
$ 10,594,471
2,538,811
1,812,869
5,576,928
1,435,041
11,363,649
(769,178)
86,654
25,340
(523,255)
(51,242)
(462,503)
(1,231,681)
27,624,460
$ 26,392,779
CITY OF TUSTIN
Statement of Cash Flows
Proprietary Fund
For the Year Ended June 30, 2010
Net cash provided by operating activities 930,682
Cash flows from capital and related
Business -type
financing activities:
Activities
Acquisition of capital assets
Water
Cash paid to other funds for capital assets
Enterprise Fund
Cash flows from operating activities:
2,123,437
Receipts from customers
$ 10,692,907
Payment to suppliers
(6,032,444)
Cash paid to other funds for services
(1,200,000)
Payment to employees
(2,529,781)
Net cash provided by operating activities 930,682
Cash flows from capital and related
financing activities:
Acquisition of capital assets
(31,724)
Cash paid to other funds for capital assets
(348,234)
Cash received from other funds
2,123,437
Principal paid on bonds
(685,000)
Interest paid
(530,105)
Net cash provided by capital and
related financing activities 528,374
Cash flows from investing activities:
Interest on investments 78,867
Net increase in cash and cash equivalents 1,537,923
Cash and cash equivalents, beginning 2,835,345
Cash and cash equivalents, ending $ 4,373,268
See Accompanying Notes to Financial Statements. (Continued)
CITY OF TUSTIN
Statement of Cash Flows
Proprietary Fund (Continued)
For the Year Ended June 30, 2010
Noncash capital and related financing activities:
Capital asset transfer to governmental activities
in exchange for portion of advance payment $ 350,013
See Accompanying Notes to Financial Statements.
Business -type
Activities
Water
Enterprise Fund
Reconciliation of operating (loss) to net cash
provided by operating activities:
Operating (loss)
$ (769,178)
Adjustments to reconcile operating (loss) to net
cash provided by operating activities:
Other nonoperating income
25,340
Depreciation and amortization
11435,041
Changes in assets and liabilities:
Decrease in accounts receivable
7,548
Decrease in prepaid costs
7,362
Increase in accounts payable and accrued liabilities
124,226
(Decrease) in unearned revenue
(962)
Increase in deposits payable
66,510
Increase in compensated absences
34,795
Net cash provided by operating activities
$ 930,682
Noncash capital and related financing activities:
Capital asset transfer to governmental activities
in exchange for portion of advance payment $ 350,013
See Accompanying Notes to Financial Statements.
CITY OF TUSTIN
Statement of Fiduciary Assets and Liabilities
June 30, 2010
Agency
Funds
Assets:
Cash and investments with fiscal agents $ 27,186,051
Taxes receivable 134,864
Total assets $ 27,320,915
Liabilities:
Accounts payable $ 38,484
Payable to the City of Tustin 425,660
Due to bondholders 26,856,771
Total liabilities
See Accompanying Notes to Financial Statements.
?o
$ 27,320,915
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CITY OF TUSTIN
Notes to Financial Statements
June 30, 2010
(1) SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
(a) The Financial Reporting Entity
The City of Tustin (City) was incorporated in 1927 as a "General Law" City governed by an elected
five -member city council. As required by accounting principles generally accepted in the United
States of America, these financial statements present the City of Tustin (the primary government)
and its component units. The component units discussed below are included in the City's reporting
entity because of the significance of their operational or financial relationship with the City. These
entities are legally separate from each other. However, the City of Tustin's elected officials have a
continuing full or partial accountability for fiscal matters of the other entities. The financial
reporting entity consists of (1) the City, (2) organizations for which the City is financially
accountable, and (3) organizations for which the nature and significance of their relationship with
the City are such that exclusion would cause the City's financial statements to be misleading or
incomplete.
An organization is fiscally dependent on the primary govemment if it is unable to adopt its budget,
levy taxes, or set rates or charges, or issues bonded debt without approval by the primary
government. In a blended presentation, a component unit's balances and transactions are reported
in a manner similar to the balances and transactions of the City. Component units are presented on
a blended basis when the component unit's governing body is substantially the same as the City's
or the component unit provides services almost entirely to the City.
1. Blended Component Units
The Tustin Community Redevelopment Agency (Agency) was established October 20, 1976
pursuant to the State of California Health and Safety Code, Section 33000, entitled "Community
Redevelopment Law". Its purpose is to prepare and carry out plans for improvement, rehabilitation,
and redevelopment of blighted areas within the territorial limits of the City of Tustin. The City
provides management assistance to the Agency, and the members of the City Council constitute the
members of the Board of Directors of the Agency. The Agency's financial data and transactions
are included with the debt service fund type and capital projects fund type.
The separate financial statements of the Tustin Community Redevelopment Agency component unit
may be obtained from the City of Tustin Finance Department located in the Tustin Civic Center.
The Tustin Public Financing Authoritv is a joint powers authority organized pursuant to the State of
California Government Code, Section 6500. The Authority exists under a Joint Exercise of Power
Agreement dated May 1, 1995, by and between the City of Tustin and the Tustin Community
Redevelopment Agency. The members of the City Council constitute the members of the Board of
Directors of the Authority. The Authority is authorized to borrow money for the purpose of
financing the acquisition of bonds, notes, and other obligations of, or for the purpose of making
loans to the City and/or to refinance outstanding obligations of the City or Assessment Districts of
the City. Currently, the Authority has only issued debt to purchase the limited obligation bonds of
Assessment Districts 95-1, 95-2, 04-1, 06-1, 07-1 and a promissory note related
CITY OF TUSTIN
Notes to Financial Statements (Continued)
June 30, 2010
to the transfer of the Tustin Marine Base to the City. Separate component unit financial statements
for the Tustin Public Financing Authority are not issued.
2. Orange County Fire Authority
In January 1995, the City of Tustin entered into a joint powers agreement with the Cities of Buena
Park, Cypress, Dana Point, Irvine, Laguna Hills, Laguna Niguel, Lake Forest, La Palma, Los
Alamitos, Mission Viejo, Placentia, San Clemente, San Juan Capistrano, Seal Beach, Stanton, Villa
Park, and Yorba Linda and the County of Orange (County) to create the Orange County Fire
Authority. The purpose of the Authority is to provide for mutual fire protection, prevention, and
suppression services and related and incidental services including, but not limited to, emergency
medical and transport services, as well as providing facilities and personnel for such services.
The effective date of formation was March 1, 1995. The Authority's governing board consists of
one representative from each City and two from the County. The operations of the Authority are
funded with structural fire fees collected by the County through the property tax roll for the
unincorporated area and on behalf of all member cities except for the Cities of Stanton, Tustin, San
Clemente, Buena Park, Placentia, and Seal Beach. The County pays all structural fees it collects to
the Authority. The Cities of Stanton, Tustin, San Clemente, Buena Park, Placentia, and Seal Beach
are considered "cash contract cities" and, accordingly, make cash contributions based on the
Authority's annual budget.
The financial statements of the Orange County Fire Authority are available at 1 Fire Authority
Road, Irvine, California.
(b) Government -wide and Fund Financial Statements
The government -wide financial statements (i.e., the statement of net assets and the statement of
changes in net assets) report information about the reporting government as a whole, except for its
fiduciary activities. Governmental activities, which normally are supported by taxes and
intergovernmental revenues, are reported separately from business -type activities, which rely to a
significant extent on fees and charges for support. Likewise, the primary government (including its
blended component units) is reported separately from discretely presented component units for
which the primary government is financially accountable. The City has no discretely presented
component units. For the most part, the effect of interfund activity has been removed from these
statements.
The statement of activities demonstrates the degree to which the direct expenses of a given function
or segment are offset by program revenues. Direct expenses are those that are clearly identifiable
with a specific function or segment. Program revenues include 1) charges to customers or
applicants who purchase, use, or directly benefit from goods, services, or privileges provided by a
given function or segment and 2) grants and contributions that are restricted to meeting the
operational or capital requirements of a particular function or segment. Taxes and other items not
properly included among program revenues are reported instead as general revenues.
CITY OF TUSTIN
Notes to Financial Statements (Continued)
June 30, 2010
The underlying accounting system of the City is organized and operated on the basis of separate
funds, each of which is considered to be 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 or expenses, as appropriate. Governmental resources are
allocated to and accounted for in individual funds based upon the purposes for which they are to be
spent and the means by which spending activities are controlled.
Separate financial statements for the City's governmental, proprietary, and fiduciary funds are
presented after the government -wide financial statements. These statements display information
about major funds individually and nonmajor funds in the aggregate for governmental funds.
Fiduciary fund statements, even though excluded from the government -wide financial statements,
include financial information that primarily represent assets held by the City in a custodial capacity
for other individuals or organizations.
(c) Measurement Focus, Basis of Accounting and Financial Statement Presentation
The government -wide financial statements are reported using the economic resources measurement
focus and the accrual basis of accounting, as are the proprietary fund and fiduciary fund (fiduciary
funds do not have a measurement focus) financial statements. Under the economic resources
measurement focus, all assets and liabilities (whether current or noncurrent) associated with their
activity are included on their balance sheets/statements of net assets. Operating statements present
increases (revenues) and decreases (expenses) in total net assets. Under 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. Proprietary funds result from providing
services and producing and delivering goods. Nonexchange transactions, in which the City gives
(or receives) value without directly receiving (or giving) equal value in exchange include taxes,
grants, entitlements, and donations. Revenue from grants, entitlements, and donations is recognized
in the fiscal year in which all the eligibility requirements have been satisfied. Property taxes are
recognized as revenue in the year for which they are levied. Operating revenues are those that result
from providing services. Operating expenses for proprietary 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 nonoperating revenues and expenses.
Governmental fund financial statements are reported using the current financial resources
measurement focus and the modified accrual basis of accounting. Under the current financial
resources measurement focus, only current assets and current liabilities are generally included on
their balance sheets. The reported fund balance (net current assets) is considered to be a measure of
"available spendable resources". Governmental fund operating statements present increases
(revenues and other financing sources) and decreases (expenditures and other financing uses) in net
current assets. Accordingly, they are said to present a summary of sources and uses of "available
spendable resources" during a period. Noncurrent portions of long-term receivables due to
governmental funds are reported on their balance sheets in spite of their spending measurement
focus. However, special reporting treatments are used to indicate that they should not be
considered "available spendable resources" since they do not represent net current assets.
Recognition of governmental fund type revenue represented by noncurrent receivables is deferred
CITY OF TUSTIN
Notes to Financial Statements (Continued)
June 30, 2010
until they become current receivables.
Under the modified accrual basis of accounting, revenues are considered to be available when they
are collectible within the current period or soon enough thereafter to pay liabilities of the current
period. For this purpose, the government considers revenues to be available if they are collected
within 60 days of the end of the current fiscal period. Expenditures generally are recorded when a
liability is incurred, except for principal and interest on long-term liabilities, claims and judgments,
and compensated absences, which are recognized as expenditures to the extent they have matured.
Capital asset acquisitions are reported as expenditures in governmental funds. Proceeds of long-
term liabilities are reported as other financing sources.
Property taxes, franchise taxes, licenses, intergovernmental revenue and interest associated with the
current fiscal period are all considered to be susceptible to accrual and so have been recognized as
revenues of the current fiscal period. All other revenue items are considered to be measurable and
available only when cash is received by the government.
All governmental activities, business -type activities and proprietary funds of the City follow
Financial Accounting Standards .Board (FASB) Statements and Interpretations, Accounting
Principles Board Opinions, and Accounting Research Bulletins, issued on or before November 30,
1989, unless those pronouncements conflict with or contradict GASB pronouncements. The City
has elected to not follow subsequent FASB pronouncements issued after November 30, 1989 for
business -type activities or proprietary funds.
When both restricted and unrestricted resources are available for use, it is the City's policy to use
restricted resources first, then unrestricted resources as they are needed.
Fund Classifications:
The funds designated as major funds are determined by a mathematical calculation consistent with
GASB Statement No. 34. The City reports the following major governmental funds:
The General Fund is the primary operating fund of the City and is used to account for all revenues
and expenditures that are not required to be accounted for in another fund.
The CFD Construction Capital Proiects Fund is used to account for construction and improvements
to the Tustin Legacy area.
The Marine Base Project Area Debt Service Fund is used to meet the debt service requirements of
the Marine Base Project Area.
The South Center Project Area Debt Service Fund is used to meet the debt service requirements of
the South Center Project Area.
CITY OF TUSTIN
Notes to Financial Statements (Continued)
June 30, 2010
The City reports the following major proprietary fund:
The Water Enterprise Fund is used to account for the City's water service operations to residents
and businesses.
The City's fund structure also includes the following fund types:
Governmental Funds:
Special Revenue Funds are used to account for the proceeds of specific revenue sources that are
restricted by law or administrative action for a specified purpose.
Debt Service Funds are used to account for the accumulation of resources for, and the payment of,
long-term liabilities, interest, and related fiscal agent costs.
Capital Projects Funds are used to account for financial resources to be used for the acquisition or
construction of major capital facilities, and for the improvement, rehabilitation, and redevelopment
of the Community Redevelopment Agency project areas.
Fiduciary Funds:
Agency Funds are used to account for assets held by the City 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. The agency funds
are used to account for taxes received for special assessments debt for which the City is not
obligated.
(d) Assets, Liabilities and Net Assets or Equity
1. Cash, Cash Equivalents and Investments
Investments are stated at fair value (the value at which a financial instrument would be exchanged
in a current transaction between willing parties other than a forced or liquidation sale), except for
certain investments which have a remaining life of less than one year when purchased and
investment contracts, which are stated at amortized cost.
The City's proprietary fund participates in the pooling of City-wide cash and investments. Amounts
held in the City pool are available to the fund on demand and are considered to be cash and cash
equivalents for statement of cash flow purposes. Investments not held in the City pool that are
short-term investments with original maturities of three months or less from the date of acquisition
are considered cash and cash equivalents.
CITY OF TUSTIN
Notes to Financial Statements (Continued)
June 30, 2010
2. Capital Assets
Capital assets (including infrastructure) are recorded at cost where historical records are available
and at an estimated original cost where no historical records exist. Contributed capital assets are
valued at their estimated fair value at the date of contribution. Capital asset purchases (other than
infrastructure) in excess of $5,000 are capitalized if they have an expected useful life of one year or
more. Infrastructure assets with a cost exceeding $100,000 are capitalized.
Capital assets include additions to public domain (infrastructure), certain improvements including
pavement, curb and gutter, sidewalks, traffic control devices, streetlights, sewers, storm drains,
bridges, and right-of-way corridors within the City.
Capital assets used in operations are depreciated over their estimated useful lives using the straight-
line method in the government -wide financial statements and in the fund financial statements of the
enterprise fund. Depreciation is charged as an expense against operations and accumulated
depreciation is reported on the respective statement of net assets. The lives used for depreciation
purposes of each capital asset class are:
Buildings 5 — 40 years
Improvements other than buildings 5 — 40 years
Property and plant 5 — 40 years
Machinery and equipment 4 —10 years
Infrastructure 25 — 75 years
3. Land Held for Resale
Land held for resale is carried at the lower of cost or estimated realizable value determined only
upon the execution of a disposition and development agreement. Fund balances are reserved in
amounts equal to the carrying value of land held for resale.
4. Property Taxes
Under California law, property taxes are assessed and collected by the counties up to 1% of
assessed value, plus other increases approved by the voters. The property taxes go into a pool, and
are then allocated to the cities based on complex formulas. Accordingly, the City of Tustin accrues
as revenues only those taxes which are received within 60 days after year end in the fund financial
statements.
CITY OF TUSTIN
Notes to Financial Statements (Continued)
June 30, 2010
Property Tax Calendar
Property taxes are assessed and collected each fiscal year according to the following property tax
calendar:
Lien date
Levy period
Levy date
Due date
Collection date
Interest and penalties are assessed after the collection date.
S. Compensated Absences
January 1
July 1 to June 30
On or before 4d' Monday in
September
November 1— I" installment
February 1— 2'Sd installment
December 10 —135 installment
April 10 — 2nd installment
All vested vacation and compensatory leave time is recognized as an expense and as a liability in
the proprietary type fund at the time the liability vests. Governmental fund types recognize the
vested vacation and compensatory time as an expenditure in the current year to the extent it is paid
during the year or is due and payable at year-end. Accrued vacation and compensatory time
relating to governmental funds is included as a liability in the long-term liabilities as those amounts
are payable from future resources, and within the statement of net assets for amounts relating to the
proprietary fund type.
(2) STEWARDSHIP, COMPLIANCE AND ACCOUNTABILITY
(a) Budgetary Data
The City follows these procedures in establishing the budgets.
1. The annual budget is adopted by the City Council after the holding of a hearing and provides
for the general operation of the City. The operating budget includes proposed expenditures
and the means of financing them.
2. The City Council approves total budgeted appropriations and any amendments to
appropriations throughout the year. This "appropriated budget" covers City expenditures in
all governmental funds, except for debt service and capital improvement projects carried
forward from prior years.
The City Manager is authorized to transfer budgeted amounts between departments. Actual
expenditures may not exceed budgeted appropriations at the fund level. Budget figures used
in the accompanying required supplementary information are the original and final adjusted
amounts.
CITY OF TUSTIN
Notes to Financial Statements (Continued)
June 30, 2010
3. Formal budgetary integration is employed as a management control device during the year.
Commitments for materials and services, such as purchase orders and contracts, are recorded
as encumbrances to assist in controlling expenditures. Capital projects appropriations are an
automatic supplemental appropriation for the next year. All others lapse unless they are
encumbered at year-end or re -appropriated through the formal budget process. There were no
outstanding encumbrances at year-end.
4. Annual budgets are adopted for the General and Special Revenue Funds on a basis
substantially consistent with accounting principles generally accepted in the United States of
America. Accordingly, actual revenues and expenditures can be compared with related
budgeted amounts without any significant reconciling items. No budgetary comparisons are
presented for the City's Debt Service, Capital Projects and Proprietary Funds as the City is
not legally required to adopt budgets for these fund types. Budgetary comparisons of other
fund types are primarily "long-term" budgets, which emphasize capital outlay plans
extending over one year. Because of the long-term nature of these budgets, "annual" budget
comparisons are not considered meaningful and accordingly, no budgetary information is
provided.
(b) Deficit Fund Balance
The Marine Base Project Area Debt Service Fund had deficit fund balance of $295,767 at June 30,
2010. This deficit is expected to be relieved from future revenues or transfers.
(c) Expenditures Exceeded Appropriations
Budget
Other Governmental Special Revenue Funds:
Actual Variance
Measure M $ 50,000 $ 342,476 $ (292,476)
Park Acquisition and Development 2,680,281 3,086,453 (406,172)
Supplemental Law Enforcement 184,400 194,520 (10,120)
CITY OF TUSTIN
Notes to Financial Statements (Continued)
June 30, 2010
(3) DETAILED NOTES ON ALL FUNDS
(a) Cash and Investments
Cash and investments as of June 30, 2010 are classified in the accompanying financial statements as
follows:
Statement of net assets:
Cash and investments $ 98,947,565
Cash and investments with fiscal agents 46,543,274
Fiduciary funds:
Cash and investments with fiscal agents 27,186,051
Total cash and investments $ 172,676,890
Cash and investments as of June 30, 2010 consist of the following:
Cash on hand $ 6,200
Deposits with financial institutions 7,076,382
Investments 165,594,308
Total cash and investments $ 172,676,890
Investments Authorized by the California Government Code and the City's Investment Policy
The table below identifies the investment types that are authorized for the City. The table also
identifies certain provisions of the City's investment policy that address interest rate risk and
concentration of credit risk. This table does not address investments of debt proceeds held by fiscal
agents that are governed by the provisions of debt agreements of the City, rather than the general
provisions of the California Government Code or the City's investment policy.
CITY OF TUSTIN
Notes to Financial Statements (Continued)
June 30, 2010
Investments Authorized by Debt Agreements
Investment of debt proceeds held by bond trustee is governed by provisions of the debt agreements,
rather than the general provisions of the California Government Code or the City's investment
policy. The table below identifies the investment types that are authorized for investments held by
bond trustees. The table also identifies certain provisions of these debt agreements that address
interest rate risk and concentration of credit risk.
Authorized
Maximum
Maximum
Maximum
Investment Types
by Investment
Investment
Percentage
Investment
Authorized by State Law
Policy
Maturity
of Portfolio
in One Issuer
None
Local Agency Bonds
Yes
5 years
None
None
U.S. Treasury Obligations
Yes
5 years
None
None
U.S. Agency Securities
Yes
5 years
None
None
Banker's Acceptances
Yes
180 days
40%
30%
Commercial Paper
Yes
90 days
15%
10%
Negotiable Certificates of Deposit
Yes
5 years
30%
None
Repurchase Agreements
Yes
1 year
None
None
Reverse Repurchase Agreements
No
92 days
20% of base value
None
Medium -Term Notes
Yes
5 years
30%
None
Mutual Funds
Yes
N/A
15%
10%
Money Market Mutual Funds
Yes
N/A
20%
10%
Mortgage Pass -Through Securities
Yes
5 years
None
None
County Pooled Investment Funds
Yes
N/A
None
None
Local Agency Investment Fund (LAIF)
Yes
N/A
None
None
JPA Pools (other Investment Pools)
Yes
N/A
None
None
Investments Authorized by Debt Agreements
Investment of debt proceeds held by bond trustee is governed by provisions of the debt agreements,
rather than the general provisions of the California Government Code or the City's investment
policy. The table below identifies the investment types that are authorized for investments held by
bond trustees. The table also identifies certain provisions of these debt agreements that address
interest rate risk and concentration of credit risk.
Maximum
Maximum
Authorized
Maximum
Percentage
Investment
Investment Type
Maturi
Allowed
in One Issuer
U. S. Treasury Obligations
None
None
None
U. S. Agency Securities
None
None
None
Banker's Acceptances
270 days
None
None
Commercial Paper
180 days
None
None
Money Market Mutual Funds
N/A
None
None
Investment Contracts
30 years
None
None
Certificates of Deposit
None
None
None
Corporate Notes
None
None
None
Repurchase Agreements
None
None
None
CITY OF TUSTIN
Notes to Financial Statements (Continued)
June 30, 2010
Disclosures Relating to Interest Rate Risk
Interest rate risk is the risk that changes in market interest rates will adversely affect the fair value
of an investment. Generally, the longer the maturity of an investment, the greater the sensitivity of
its fair value to changes in market interest rates. One of the ways that the City manages its
exposure to interest rate risk is by purchasing a combination of shorter term and longer term
investments and by timing cash flows from maturities so that a portion of the portfolio is maturing
or coming close to maturity evenly over time as necessary to provide the cash flow and liquidity
needed for operations.
As of June 30, 2010, the City had the following investments. Except for the investments in money
market funds and investment contracts, all investments are in the City's internal investment pool.
Investment Type
Federal National Management Association $
Wachovia Corp Global Sr.
Unsecured (Corporate Notes)
Merrill Lynch & Co Global Sr.
Amount
Maturity Date
4,999,000 September 1, 2010
1,985,558 October 15, 2011
Unsecured (Corporate Notes)
2,913,630
June 5, 2012
U. S. Treasury Bill
9,991,280
December 9, 2010
U. S. Treasury Note
3,015,936
January 31, 2012
U. S. Treasury Note
2,026,250
February 15, 2013
State of California Investment Pool (LAIF)
45,736,296
203 days weighted average to maturity
Orange County Investment Pool
10,172,518
58 days weighted average to maturity
Government Reserve Money Market
11,024,515
300 days weighted average to maturity
Total pooled investments 91,864,983
Investments held by fiscal agents:
Money market funds 66,567,379
Investment contracts 7,161,946
Total investments with bond trustee 73,729,325
Total investments $ 165,594,308
Investments with Fair Values Highly Sensitive to Interest Rate Fluctuations
As of June 30, 2010, the City did not have any investments that were highly sensitive to interest
rate fluctuations.
CITY OF TUSTIN
Notes to Financial Statements (Continued)
June 30, 2010
Disclosures Relating to Credit Risk
Generally, credit risk is the risk that an issuer of an investment will not fulfill its obligation to the
holder of the investment. This is measured by the assignment of a rating by a nationally recognized
statistical rating organization. Presented below is the minimum rating required by (where
applicable) the California Government Code, the City's investment policy, or debt agreements, and
the actual rating as of year end for each investment type.
Investment
U. S. Treasury Bills
U.S. Treasury Notes
Federal Agency Securities
State Investment Pool
Orange County
investment pool
Government reserve
money market funds
Corporate Notes
Held by fiscal agents:
Money market funds
Investment contracts
Total
Minimum Exempt Rating as of Year End
Legal From
Amount Rating Disclosure AAA AA- A Not Rated
$ 9,991,280 N/A $ 9,991,280 $ $ $ $
5,042,186 N/A 5,042,186
4,999,000 - 4,999,000
45,736,296 N/A - 45,736,296
10,172,518 N/A 10,172,518
11,024,515 N/A 11,024,515 - -
4,899,188 AA - 1,985,558 2,913,630
66,567,379 N/A 66,567,379 - - -
7,161,946 N/A - - 7,161,946
$ 165,594,308 $ 15,033,466 $ 82,590,894 S 1,985,558 S 2,913,630 $. 63,070,760
Concentration of Credit Risk
The investment policy of the City contains no limitations on the amount that can be invested in any
one issuer beyond that stipulated by the California Government Code. The City does not have
Investments in any one issuer (other than U. S. Treasury securities, mutual funds, and external
investment pools) that represent 5% or more of total City investments.
Custodial Credit Risk
Custodial credit risk for deposits is the risk that, in the event of the failure of a depository financial
institution, a government will not be able to recover its deposits or will not be able to recover
collateral securities that are in the possession of an outside party. The custodial credit risk for
investments is the risk that, in the event of the failure of the counterparty (e.g., broker-dealer) to a
transaction, a government will not be able to recover the value of its investment or collateral
securities that are in the possession of another party. The California Government Code and the
City's investment policy do not contain legal or policy requirements that would limit the exposure
to custodial credit risk for deposits or investments, other than the following provision for deposits:
CITY OF TUSTIN
Notes to Financial Statements (Continued)
June 30, 2010
The California Government Code requires that a financial institution secures deposits made by state
or local governmental units by pledging securities in an undivided collateral pool held by a
depository regulated under state law (unless so waived by the governmental unit). The market
value of the -pledged securities in the collateral pool must equal at least 110% of the total amount
deposited by the public agencies. California law also allows financial institutions to secure City
deposits by pledging first trust deed mortgage notes having a value of 150% of the secured public
deposits.
As of June 30, 2010, none of the City's deposits with financial institutions in excess of federal
depository insurance limits were held in uncollateralized accounts. As of June 30, 2010, the City's
investments in the following investment types were held by the same broker-dealer (counterparty)
that was used by the City to buy the securities:
Investment Type
U. S. Treasuries
Federal Agency Securities
Corporate Notes
Investment in State Investment Pool
Reported Amount
$15,033,466
4,999,000
4,899,188
The City is a voluntary participant in the Local Agency Investment Fund (LAIF) that is regulated
by the California Government Code under the oversight of the Treasurer of the State of California.
The fair value of the City's investment in this pool is reported in the accompanying financial
statements at amounts based upon the City's pro -rata share of the fair value provided by LAIF for
the entire LAIF portfolio (in relation to the amortized cost of that portfolio). The balance available
for withdrawal is based on the accounting records maintained by LAIF, which are recorded on an
amortized cost basis.
The total amount invested by all public agencies in LAIF as of June 30, 2010 was $23.0 billion.
LAW is part of the California Pooled Money Investment Account (PMIA), which at June 30, 2010
had a balance of $69.4 billion, of that amount, 5.42% was invested in medium-term and short-term
structured notes and asset-backed securities. The average maturity of PMIA investments was 203
days as of June 30, 2010.
Investment in County Investment Pool
The Orange County Investment Pool Fund (OCPIF) is a pooled investment fund program governed
by the Orange County Board of Supervisors, and is administered by the Orange County Treasurer
and Tax Collector. Investments in OCPIF are highly liquid as deposits and withdrawal can be made
at any time without penalty. The City's fair value of its share in the pool is the same value of the
pool shares, which amounted to $10,172,518. Information on OCPIF's use of derivative securities
in its investment portfolio and OCPIF's and the City's exposure to credit, market, or legal risk is
not available.
CITY OF TUSTIN
Notes to Financial Statements (Continued)
June 30, 2010
(b) Loans Receivable
Multi -Family Development Loan: The Agency provided a Bridge Loan to Senior Apartment
Developer to assist in the development of 53 affordable rental units. The total outstanding balance
as of June 30, 2010, was $347,510.
Home Improvement Loans: The Agency has provided deferred home improvement loans to low
and moderate income households (rental and ownership). These deferred loans are due upon sale,
refinance, or when the rental units are no longer available as affordable units. Term is 30 years.
The total outstanding balance as of June 30, 2010, was $65,104. An allowance of $65,104 has been
recorded to reflect the amount of the loans not expected to be collectible.
Homebuyer Program Loans: The Agency has provided down payment assistance to qualified first time
homebuyers. The loans provided in the Ambrose Lane Development are due beginning in 2016, or when
the homeowner sells or refinances. The loans provided in the Tustin Grove Development are due when the
homeowner sells or refinances. If the homeowner does not sell or refinance before July 2015, the loan is
forgiven. The total outstanding balance as of June 30, 2010, was $681,692. An allowance of $655,238
has been recorded to reflect the amount of loans not expected to be collectible.
(c) Interfund Receivables, Payables, and Transfers
Due To and Due From
The composition of interfund balances as of June 30, 2010 is as follows:
Due To Due From
General Fund CFD Construction
Capital Projects Fund $ 793,233
Marine Base Project Area
Debt Service Fund 4,516,411
South Central Project Area
Debt Service Fund 4,650,000
Nonmaj or Governmental Funds 16,108
$ 9,975,752
The amounts loaned from General Fund to Marine Base Project Area Debt Service Fund, South
Central Project Area Debt Service Fund, and nonmajor governmental funds, are to provide short-
term loans to fund operations.
CITY OF TUSTIN
Notes to Financial Statements (Continued)
June 30, 2010
Advances To and Advances From
The composition of interfund advances as of June 30, 2010 is as follows:
Advances To
Water
Enterprise
Advances From General Fund Fund Totals
Marine Base Project Area
Debt Service Fund $ 6,704,151 $ $ 6,704,151
South Central Project Area
Debt Service Fund 6,704,153 6,704,153
Nonmajor Governmental Funds 6,704,152 2,141,191 8,845,343
$ 20,112,456 $ 2,141,191 $ 22,253,647
• On April 6, 2010, the City entered into a promissory note with Tustin Water Enterprise
Fund in the amount of $2,123,437 to provide the cash necessary to meet the bond covenant.
The Water Enterprise Fund promised to pay the City on June 1, 2015, the principal amount
of $2,123,437 with interest accrued thereon from April 6, 2010 to the maturity date at the
rate of 3.5% per annum, compounded semiannually on June 1 and December 1 in each
year, commencing June 1, 2010. The total amount receivable from Water Fund as of June
30, 2010 for nonmajor governmental funds is $2,141,191.
• On December 31, 2008, the City entered into a promissory note with the Agency in the
amount of $18,881,750. The City promised to pay the Agency on December 1, 2013, the
principal amount of $18,881,750 with interest accrued thereon from December 30, 2008 to
the maturity date at the rate of 4.25% per annum, compounded semiannually on June 1 and
December 1 in each year, commending June 1, 2009. The total amount receivable from the
General Fund as of June 30, 2010 for the Marine Base Project Area Debt Service Fund,
South Central Project Area Debt Service Fund and non -major governmental funds, is
$6,704,151, $6,704,153, and $6,704,152, respectively.
CITY OF TUSTIN
Notes to Financial Statements (Continued)
June 30, 2010
Interfund Transfers
The composition of interfund transfers for the year ended June 30, 2010 is as follows:
Transfers Out General Fund
Transfers In
Marine Base
Project Area
Debt Service
Fund
Nonmaj or
Governmental
Funds Totals
Nonmajor Governmental
Funds $ 28,482,712 $ 2,617,216 $ 6,107,733 $ 37,207,661
• A transfer from nonmajor governmental funds was made to reimburse the General Fund
per adopted budget for fiscal year 2009-10 and for activities related to the reimbursement
agreement between the City and the Agency.
• A transfer from nonmajor governmental funds was made to Marine Base Project Area
Debt Service Fund to provide funding for operations.
• A transfer from nonmajor governmental funds was made to nonmajor governmental
funds to cover negative fund balance and to cover capital project expenditures.
(e) Land Transfer from the United States Government
On May 13, 2002, the City entered into an agreement with the United States of America (the
Government) wherein the Government agreed to convey to the City a portion of the former Marine
Corps Air Station Tustin (MCAS Tustin). The transfer is pursuant to the authority provided by
Section 2905(b)4 of the Defense Base Closure and Realignment Act of 1990, as amended, and the
implementing regulations of the Department of Defense to convey surplus property at a closing
installation to the local redevelopment authority at no cost for economic development purposes.
The real properties, consisting of approximately 1,153 acres of land located within the bounds of
the former MCAS Tustin, will be conveyed to the City in multiple parcels, by separate
conveyances. Parcel Group I, (consisting of approximately 977 acres), was conveyed to the City on
May 14, 2002. A portion of Parcel Group I (consisting of approximately 23 acres) was conveyed to
the City during fiscal year 2003 and the remainder was conveyed to the City in fiscal year 2004.
Conveyance of Parcel Group II (consisting of a total of 49 acres) was conveyed in September 2006
and May and July 2003. Conveyance of Parcel Group III (consisting of approximately 18 acres) and
Parcel Group IV (consisting of approximately 119 acres) were conveyed in September 2006 and
April 2008, respectively. As part of the agreement, the City also received certain personal property
and utilities on the base.
Subsequent to the conveyance of properties from the Government, the Agreement required the City
to convey approximately 22 acres to Santa Ana Unified School District (SAUSD), 15 acres to
CITY OF TUSTIN
Notes to Financial Statements (Continued)
June 30, 2010
Rancho Santiago Community College District (RSCCD) and 65 acres to South Orange County
Community College District (SOCCCD) subject to certain conditions as detailed in the agreement
with the Government and the terms and conditions of the settlement and release agreements
between the City and SAUSD and the City and the RSCCD.
The SAUSD declined the conveyance of the land from the City and instead of receiving the land,
the SAUSD was paid $60,000,000 under an agreement dated December 20, 2002. The City
conveyed the RSCCD parcel during fiscal year 2003. Conveyance of the SOCCCD parcel happened
in fiscal year 2004.
The value of the remaining parcels that have been conveyed to the City as of June 30, 2010 is
$101,558,282 and is included in the total of the land held for resale reported in the General Fund.
The value was based on an assumption that most of the land will be sold in a bulk sale to a single
developer and the remaining property not sold will be park space or conveyed to other
governmental agencies.
CITY OF TUSTIN
Notes to Financial Statements (Continued)
June 30, 2010
09 Capital Assets
A summary of changes in the Governmental Activities capital assets for the year ended June 30,
2010 is as follows:
Capital assets, not being depreciated:
Land
Right of way
Construction in progress
Total capital assets, not
being depreciated
Capital assets, being depreciated:
Balance at
June 30, 2009
As Restated *
Balance at
Increases Decreases June 30, 2010
$ 19,259,596 $ -
41,899,855 508,345
47,775,949 3,767,832
$ - $ 19,259,596
42,408,200
19,697,198 31,846,583
108,935,400 4,276,177 19,697,198 93,514,379
Buildings
32,199,191
17,650,369
12,536 49,837,024
Improvements other than buildings
8,944,713
5,191,952
- 14,136,665
Machinery and equipment
13,110,535
143,119
490,916 12,762,738
Infrastructure
281,102,818
3,610,746
959,142 283,754,422
Total capital assets,
being depreciated
Less accumulated depreciation for:
Buildings
Improvements other than buildings
Machinery and equipment
Infrastructure
Total accumulated
depreciation
Total capital assets, being
depreciated, net
Total governmental activities
capital assets, net
335,357,257
26,596,186
1,462,594
360,490,849
8,334,256
886,007
12,536
9,207,727
2,276,708
428,223
-
2,704,931
9,716,357
1,029,174
488,079
10,257,452
65,366,232
6,765,858
579,664
71,552,426
85,693,553
9,109,262
1,080,279
93,722,536
249,663,704
17,486,924
382,315
266,768,313
$ 358,599,104 $ 21,763,101 $ 20,079,513 $ 360,282,692
* Capital assets were restated to record the unrecorded land in the amount of $1,300,000 that should
have been recorded in prior years. In addition, a reclassification of $5,260,279 from Construction in
progress to Land was necessary to correct the land that was incorrectly reported under Construction
in progress in prior years.
CITY OF TUSTIN
Notes to Financial Statements (Continued)
June 30, 2010
Depreciation expense was charged to functions/programs of the governmental activities as follows:
General government
Public safety
Public works
Community services
Total
$ 89,571
601,282
7,974,750
443,659
$ 9,109,262
A summary of changes in the Business -type Activities capital assets for the year ended June 30,
2010 is as follows:
Balance at
July 1, 2009 Balance at
As Restated * Increases Decreases June 30, 2010
Capital assets, not being depreciated:
Lard $ 1,177,216 $ - $ - $ 1,177,216
Construction in progress 2,538,136 31,724 1,423,703 1,146,157
Total capital assets, not
being depreciated
Capital assets, being depreciated:
Buildings and improvements
Property, plart, and equipment
Total capital assets,
being depreciated
Less accumulated depreciation for:
Buildings and improvements
Property, plart, and equipment
Total accumulated
depreciation
Total capital assets, being
depreciated, net
Total business -type activities
capital assets, net
3,715,352 31,724 1,423,703 2,323,373
9,546,474 - - 9,546,474
41932,184 1,072,690 173,642 42,831,232
51,478,658 1,072,690 173,642 52,377,706
3,412,844 269,011 - 3,681,855
14,940,332 1,124,063 122,400 15941,995
18,353,176 1,393,074 122,400 19,623,850
33,125,482 (320,384) 51,242 32,753,856
$ 36,840,834 $ (288,660) $ 1,474,945 $ 35,077,229
* Capital assets were restated to reduce the Construction in progress for project expenditures
totaling $513,557 that were incorrectly capitalized in prior years.
CITY OF TUSTIN
Notes to Financial Statements (Continued)
June 30, 2010
(g) Long-term Liabilities
A summary of long-term liability activity for the year ended June 30, 2010 is as follows:
23,500,000
- 23,500,000 - -
Beginning
1,939,920
Ending
Due Within
1,699,651
Balance
Additions Reductions
Balance
One Year
Governmental activities:
Bonds and notes payable:
Tax allocation bonds
$ 10,870,000
$ 26,170,000 $ 1,150,000
$ 35,890,000
$ 2,460,000
Unamortized bond premium
-
104,205 1,177
103,028
-
Notes payable
14,962,000
- 6,763,000
8,199,000
8,199,000
Total bonds and
notes payable
25,832,000 26,274,205 7,914,177 44,192,028 10,659,000
Land acquisition settlement
23,500,000
- 23,500,000 - -
Claims and judgments
1,939,920
1,342,669 1,041,626 2,240,963 2,240,963
Postemployment benefits obligation
1,699,651
897,043 135,678 2,461,016 -
Compensated absences
3,326,724
2,490,977 2,641,883 3,175,818 2,858,236
Total governmental
activities long-term liabilities
Business -type activities:
Water enterprise:
Bond payable:
2003 Refunding
Water revenue bonds
Deferred charges
on refunding
Compensated absences
Total business -type
activities long-term liabilities
Governmental Activities:
Tax Allocation Bonds
$ 56,298,295 $ 31,004,894 $ 35,233,364 $ 52,069,825 $ 15,758,199
$ 12,560,000 $ - $ 685,000 $ 11,875,000 $ 710,000
(170,433) - (23,240) (147,193) -
191,157 199,955 184,276 206,836 186,152
$ 12,580,724 $ 199,955 $ 846,036 $ 11,934,643 $ 896,152
On July 1, 1998, the Agency issued $20,805,000 Tax Allocation Refunding
Bonds to refund the Agency's Town Center Area Redevelopment Project
Tax Allocation Refunding Bonds, Series 1987, in aggregate principal amount
of $5,145,000 and the Agency's Town Center Area Redevelopment Project
Subordinate Tax Allocation Bonds, Series 1991 in aggregate principal
amount of $12,880,000. As of June 30, 2006, the 1987 and 1991 bonds have
been fully redeemed.
CITY OF TUSTIN
Notes to Financial Statements (Continued)
June 30, 2010
Serial bonds are payable in annual installments ranging from $775,000 -
$1,315,000 commencing on December 1, 1998. Interest is payable
semiannually on June 1 and December 1, with rates ranging from 3.5% to
5.0% per annum. The bonds maturing on or after December 1, 2009, are
subject to redemption prior to maturity as a whole or in part, at the option of
the Agency, on any date on or after December 1, 2008 at prices ranging from
100% to 101 % of principal.
On March 1, 2010, the Agency issued $26,170,000 Tax Allocation Housing
Bonds, Series 2010 to refmance low and moderate income housing activities
throughout the geographic boundaries of the City and, in particular, to repay
a reimbursement obligation from the Agency to the City, relating to the
City's write down of land for use for affordable housing purposes. Serial
bonds are payable in annual installments ranging from $550,000 to
$1,300,000 commencing on September 1, 2010. Interest is payable
semiannually on March 1 and September 1, with rates ranging from 2% to
5% per annum.
Total
The annual requirements to amortize the tax allocation refunding bonds are
as follows:
Year Ending
June 30,
Principal
Interest
Total
2011
$ 2,460,000
$ 1,577,955
$ 4,037,955
2012
1,950,000
1,506,798
3,456,798
2013
2,030,000
1,423,952
3,453,952
2014
2,115,000
1,336,504
3,451,504
2015
2,205,000
1,242,244
3,447,244
2016-2020
7,370,000
4,944,200
12,314,200
2021-2025
5,190,000
3,831,534
9,021,534
2026-2030
5,220,000
2,497,125
7,717,125
2031-2035
3,210,000
1,524,663
4,734,663
2036-2040
4,140,000
565,688
4,705,688
Total
$ 35,890,000
$ 20,450,663
$ 56,340,663
$ 9,720,000
26,170,000
CITY OF TUSTIN
Notes to Financial Statements (Continued)
June 30, 2010
Notes Payable
On April 1, 2007, the Agency entered into two related Note Purchase
Agreements in the amounts of $19,900,000 Series B (Tax-exempt) and
$5,100,000 Series A (Taxable) with Citigroup Global Markets, Inc. for the
acquisition of a thirty-seven acre parcel of land adjacent to the Marine Base
Project Area that will provide freeway access to and from the Marine Base
Project Area. Principal is payable in annual payments due in November of
each year. Interest payments are payable monthly during the Initial Note
Period with a fixed interest rate of 4.32% through November 2008. After the
Initial Note Period, variable rate interest payments are payable monthly
based upon the current Securities Industry and Financial Markets Association
Municipal Swap Index (SIFMA) on the 2007 Series A Note and the London
Interbank Offered Rate (LIBOR) for the 2007 Series B Note. Interest
payments after the Initial Note Period have been calculated based upon the
year-end interest rates of 1.03% for Series A and 4.56% for Series B. The
remaining balance of the notes is due in fiscal year 2011.
The Notes are secured by a lien on the aggregate tax increment revenue
generated in the Marine Base Project Area. In addition, any proceeds from
sale of land are pledged to the repayment of the notes. 8 1 000
The annual debt service requirements are as follows:
Year Ending
June 30, Principal Interest Total
2011 $ 8,199,000 $ 145,383 $ 8,344,383
Pledged Revenues
The tax allocation bonds and notes payable are secured and to be serviced
from tax increment revenues and dedicated housing tax increment, through
the fiscal year 2040. Total debt service requirements for tax allocation bonds
through 2040 are $56,340,663 consisting of principal payments of
$35,890,000 and interest payments of $20,450,663, and total debt service
requirements for notes payable through 2011 are $8,344,383 consisting of
principal payments of $8,199,000 and interest payments of $145,383 Pledged
tax increment revenue recognized during the year was $18.7 million against
the total debt service payments of $8.6 million.
Although the incremental property taxes were projected to produce sufficient
revenues to meet the debt service requirements over the life of the bonds,
certain conditions could have a material, adverse impact on revenues
CITY OF TUSTIN
Notes to Financial Statements (Continued)
June 30, 2010
allocated to the Agency. These include future decreases in the assessed
valuation of the project areas, decreases in the applicable tax rates or
collection rates, general decline in the economic condition of the project
areas, or a change in the law reducing the tax increment received by the
Agency.
Business -type Activities:
2003 Refunding Water Revenue Bonds
On September 9, 2003, the City issued $14,355,000, 2003 Refunding Water
Revenue Bonds. The Bonds were issued to provide funds to defease the
Water System Revenue Certificates of Participation, Series 1993 and prepay
certain outstanding notes payable incurred to finance improvements to the
Water Enterprise.
The Bonds are payable in annual installments ranging from $130,000 to
$1,160,000 until maturity on April 1, 2023. Interest is payable semiannually
on April 1 and October 1, with rates ranging from 3.7% to 4.65% per annum.
The defeasance resulted in a difference between the reacquisition price and
the net carrying amount of the old debt of $309,873. The difference reported
in the accompanying statements as a deduction from revenue bonds payable,
is being charged to interest expense through 2023.
The City has pledged net revenues received from the operation of Water
Enterprise to repay the outstanding debt service. The net revenues are the
amount of the gross revenues received less the amount of maintenance and
operation costs, which include management, personnel, services, equipment,
repair and other necessary costs of maintaining and operating the Water
Enterprise. The City has covenanted to fix, prescribe, revise and collect rates,
fees and charges for the services and facility furnished by the Water
Enterprise during each fiscal, year which are sufficient to yield net revenues,
at least equal to 120% of the annual debt service on the bonds. At June 30,
2010, total interest and principal remaining on the bonds is $15,777,065.
During the fiscal year, the total principal paid and interest expense incurred
were $1,208,255, and net revenues were $2,389,039.
11.875.000
CITY OF TUSTIN
Notes to Financial Statements (Continued)
June 30, 2010
The annual requirements to amortize the bonds are as follows:
Year Ending
June 30, Principal Interest
2011
$ 710,000
2012
740,000
2013
770,000
2014
800,000
2015
830,000
2016-2020
4,695,000
2021-2023
3,330,000
11,875,000
Less: deferred charges on refunding
(147,193)
Total
$ 11,727,807
(4) OTHER INFORMATION
(a) Pension Plan
Plan Description
$ 502,705
474,305
444,705
413,905
381,905
1,373,960
310,580
3,902,065
Total
$ 1,212,705
1,214,305
1,214,705
1,213,905
1,211,905
6,068,960
3,640,580
15,777,065
- (147,193)
$ 3,902,065 $ 15,629,872
The City contributes to the California Public Employees' Retirement System (PERS), an agent -
multiple employer public employee defined pension benefit plan for miscellaneous employees and a
cost-sharing multiple -employer public employee defined benefit pension plan for public safety
employees. PERS provides retirement and disability benefits, annual cost -of -living adjustments,
and death benefits to plan members and beneficiaries. PERS acts as a common investment and
administrative agent for participating public entities within the State of California. Benefit
provisions and all other requirements are established by state statute and City ordinance. Copies of
PERS' annual financial report may be obtained from their executive office: 400 P Street,
Sacramento, CA 95814.
Funding Policy
Participants are required to contribute 7% (9% for safety employees) of their annual covered salary.
The City makes the contributions required of City employees on their behalf and for their account.
The City is required to contribute the remaining amount necessary to fund the benefits for its
members, using the actuarial methods recommended by the PERS actuaries and actuarial
consultants and adopted by the Board of Administration.
The required employer contribution rate for year ended June 30, 2010 was 8.775% for
miscellaneous employees. The contribution requirements of the plan members are established by
the state statute and the employer contribution rate is established and may be amended by PERS.
CITY OF TUSTIN
Notes to Financial Statements (Continued)
June 30, 2010
The funded status of the plan based on the June 30, 2009 actuarial valuation is as follows:
Unfunded
Actuarial
Actuarial
Unfunded
Annual
Liability %
Accrued
Value of
Liability Funded
Covered
of Covered
Liability
Assets
(Excess Assets) Ratio
Payroll
Payroll
$ 64,934,473
$ 59,641,991
$ 5,292,482 91.8% $
14,785,480
35.8%
The schedule of funding progress presented as Required Supplementary Information following the
Notes to Financial Statements, presents multi-year trend information about whether the actuarial
value of plan assets is increasing or decreasing over time relative to the actuarial accrued liability
for benefits. The assumptions for the June 30, 2009 actuarial valuation for the funded status were
the same as those of the June 30, 2007 valuation that determined the required contributions.
Annual Pension Cost
For 2010, the City's annual pension cost of $2,254,708 for the Miscellaneous Plan and $3,245,673
for the Safety Plan (based on an actuarially determined basis) was equal to the City's required and
actual contributions. The required contribution for the miscellaneous plan for the year ended June
30, 2010 was determined as part of the June 30, 2007 actuarial valuation using the entry age normal
actuarial cost method. The actuarial assumptions for the Miscellaneous Plan included (a) 7.75%
investment rate of return (net of administrative expenses), (b) projected annual salary increases that
vary by duration of service, and (c) 3.25% per year cost -of -living adjustments. Both (a) and (b)
included an inflation component of 3.0%. The actuarial value of PERS assets was determined using
techniques that smooth the effects of short-term volatility in the market value of investments over a
four-year period (smoothed market value). PERS unfunded actuarial accrued liability is being
amortized as a level percentage of projected payroll on a closed basis. The remaining amortization
period as of the actuarial valuation date was 19 years for the miscellaneous employee plan.
Three -Year Trend Information for PERS
Miscellaneous Plan
Percentage of
APC Contributed
100%
100%
100%
Net Pension
Oblieation
Annual
Fiscal
Pension
Year
Cost (APCI
6/30/08
$2,145,788
6/30/09
2,379,894
6/30/10
2,254,708
Percentage of
APC Contributed
100%
100%
100%
Net Pension
Oblieation
CITY OF TUSTIN
Notes to Financial Statements (Continued)
June 30, 2010
Three -Year Trend Information for PERS
Safety Plan
(b) Postemployment Health Care Benefits
Plan Description
Net Pension
Obligation
The City provides other postemployment benefits (OPEB) to retired employees in the form of a
contribution towards their medical premiums under the PERS health plan, which provides medical
insurance benefits to eligible retirees in accordance with various labor agreements. Survivor
benefits are not provided. The City's OPEB plan does not issue a separate stand-alone report.
Eligibility
Employees are eligible for retiree health benefits if they retire from the City on or after age 50
(unless disabled), with five years of service and are eligible for a PERS pension and are enrolled in
a PERS retiree health plan. The benefits are available only to employees who retire from the City.
Membership of the plan consisted of the following at June 30, 2010:
Police
Police General Mgmt Conf Support Total
Retirees Receiving Benefits 25 21 18 - 3 67
Eligible Active Employees 91 101 41 5 40 278
The above table does not reflect current retirees not enrolled in the PERS health plan who may be
eligible to enroll in the plan at a later date.
Funding Policy
The City's current contribution is based on pay-as-you-go. As of July 1, 2009, the City's monthly
contribution rate was $250 for the Confidential, General, and Police Support groups; $350 for the
Police group and $430 for the Management group. For the year ended June 30, 2010, the City paid
$135,678 directly to retirees towards their postemployment health care benefits. Current active
employees are not required to contribute any portion towards these benefits.
Annual
Fiscal
Pension
Percentage of
Year
Cost (APC)
APC Contributed
6/30/08
$3,031,357
100%
6/30/09
3,323,919
100%
6/30/10
3,245,673
100%
(b) Postemployment Health Care Benefits
Plan Description
Net Pension
Obligation
The City provides other postemployment benefits (OPEB) to retired employees in the form of a
contribution towards their medical premiums under the PERS health plan, which provides medical
insurance benefits to eligible retirees in accordance with various labor agreements. Survivor
benefits are not provided. The City's OPEB plan does not issue a separate stand-alone report.
Eligibility
Employees are eligible for retiree health benefits if they retire from the City on or after age 50
(unless disabled), with five years of service and are eligible for a PERS pension and are enrolled in
a PERS retiree health plan. The benefits are available only to employees who retire from the City.
Membership of the plan consisted of the following at June 30, 2010:
Police
Police General Mgmt Conf Support Total
Retirees Receiving Benefits 25 21 18 - 3 67
Eligible Active Employees 91 101 41 5 40 278
The above table does not reflect current retirees not enrolled in the PERS health plan who may be
eligible to enroll in the plan at a later date.
Funding Policy
The City's current contribution is based on pay-as-you-go. As of July 1, 2009, the City's monthly
contribution rate was $250 for the Confidential, General, and Police Support groups; $350 for the
Police group and $430 for the Management group. For the year ended June 30, 2010, the City paid
$135,678 directly to retirees towards their postemployment health care benefits. Current active
employees are not required to contribute any portion towards these benefits.
CITY OF TUSTIN
Notes to Financial Statements (Continued)
June 30, 2010
Annual OPEB Cost and Net OPEB Obligation. The City's annual (OPEB cost (expense) is
calculated based on the annual required contribution of the employer (ARC), an amount actuarially
determined in accordance with the parameters of 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 (or funding excess) not to exceed thirty years.
The City's ARC for the year ended June 30, 2010 was $960,757. The following table shows the
components of the City's annual OPEB cost for the year, the amount actually contributed to the
plan, and changes in the City's net OPEB obligation:
The City's annual OPEB cost, the percentage of annual OPEB cost contributed to the plan, and the
net OPEB obligation for 2010 and the two preceding years were as follows:
Fiscal
Year Annual
Ended OPEB Cost
6/30/08 $ 993,822
6/30/09 1,090,989
6/30/10 897,043
Funding Status and Progress
Percentage of Net
Annual OPEB OPEB
Cost Contributed Obligation
19.1% $ 803,748
17.9% 1,699,651
15.1% 2,461,016
As of June 30, 2010, the most recent valuation date, the actuarial accrued liability for benefits was
$13.6 million, and the actuarial value of assets was $0, resulting in an unfunded actuarial accrued
liability (UAAL) of $13.6 million and a funded ratio (actuarial value of assets as a percentage of the
actuarial accrued liability) of 0%. The covered payroll (annual payroll of active employees) was
$23.1 million and the ratio of the UAAL to the covered payroll was 58.9%. No estimate of the
actuarial accrued liability at June 30, 2010 has been made. The City is evaluating its options in
developing a funding policy for its OPEB obligations. The City intends on adopting and applying
an appropriate policy during the 2010/11 fiscal year.
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
Police
Total
Police
General
Management
Confidential
Support
June 30, 2010
Annual required contribution (OPEB cost)
$ 310,562
$ 223,385
$ 229,920
$ 117,909
$ 78,981
$ 960,757
Interest on net OPEB obligation
23,505
16,941
17,464
8,908
5,998
72,816
Adjustment to annual required contribution
(44,072)
(31,764)
(32,746)
(16,702)
(11,246)
(136,530)
Annual pension cost (expense)
289,995
208,562
214,638
110,115
73,733
897,043
Contributions made
58,867
28,881
43,200
-
4,730
135,678
Increase in net OPEB obligation
231,128
179,681
171,438
110,115
69,003
761,365
Net OPEB obligation, beginning
502,750
385,985
407,054
250,049
153,813
1,699,651
Net OPEB obligation, ending
$ 733,878
$ 565,666
$ 578,492
$ 360,164
$ 222,816
$ 2,461,016
The City's annual OPEB cost, the percentage of annual OPEB cost contributed to the plan, and the
net OPEB obligation for 2010 and the two preceding years were as follows:
Fiscal
Year Annual
Ended OPEB Cost
6/30/08 $ 993,822
6/30/09 1,090,989
6/30/10 897,043
Funding Status and Progress
Percentage of Net
Annual OPEB OPEB
Cost Contributed Obligation
19.1% $ 803,748
17.9% 1,699,651
15.1% 2,461,016
As of June 30, 2010, the most recent valuation date, the actuarial accrued liability for benefits was
$13.6 million, and the actuarial value of assets was $0, resulting in an unfunded actuarial accrued
liability (UAAL) of $13.6 million and a funded ratio (actuarial value of assets as a percentage of the
actuarial accrued liability) of 0%. The covered payroll (annual payroll of active employees) was
$23.1 million and the ratio of the UAAL to the covered payroll was 58.9%. No estimate of the
actuarial accrued liability at June 30, 2010 has been made. The City is evaluating its options in
developing a funding policy for its OPEB obligations. The City intends on adopting and applying
an appropriate policy during the 2010/11 fiscal year.
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
CITY OF TUSTIN
Notes to Financial Statements (Continued)
June 30, 2010
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. The schedule of funding progress, presented as required
supplementary information following the notes to the financial statements, presents multi-year trend
information about whether the actuarial value of plan assets is increasing or decreasing over time
relative to the actuarial accrued liabilities for the benefits.
Actuarial Methods and Assumptions
Projections of benefits for financial reporting purposes are based on the substantive plan (the plan
as understood by the employer and the plan members) and include the types of benefits provided at
the time of each valuation and the historical pattern of sharing of benefit costs between employer
and plan members to that point. The 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 assets, consistent with the long-term perspective of the calculations.
The actuarial cost method used for determining the benefit obligations is the entry age normal cost
method. The actuarial assumptions included a 5.00% and 4.25% investment rate of return for the
June 1, 2007 and June 30, 2010 valuations, respectively, which is based on assumed long-term
investment return on plan assets and on the City's assets, as appropriate, and an annual healthcare
cost trend rate increases vary by year. The UAAL is being amortized as a level percentage of
projected payroll over 30 years. It is assumed the City's payroll will increase 3.00% and 3.25% per
year for the June 1, 2007 and June 30, 2010 valuations, respectively.
(c) Self -Insurance ProgramlRisk Pool
The City uses a combination of insured and self-insured programs to finance its property and
casualty risk. The City is self-insured for worker's compensation, automotive, and general liability
risks. Excess liability coverage for the City's self-insurance retention of $250,000 per occurrence is
provided through a risk sharing pool, the California Insurance Pool Authority (CIPA). The CIPA
provides excess liability coverage above $2,000,000 per occurrence and $40,000,000 annual
aggregate. The City's self-insurance retention limit is $400,000 per occurrence for worker's
compensation claims. Worker's compensation claims which exceed the self-insurance retention are
insured by CIPA up to the California statutory limit for worker's compensation. Property and
employment practices liability risk are financed through insurance contracts and have various limits
and deductibles.
The City is a member, of CIPA in order to jointly purchase insurance coverage and to share costs for
professional risk management, claim administration, and group purchasing of insurance products
with ten other Orange County cities. Members may be assessed the difference between the funds
available and the $40,000,000 annual aggregate in proportion to their annual premium. CIPA uses
independent actuaries and underwriters to determine premiums and help set insurance limits and
deductible levels.
The pool is managed by an independent general manager and contracted legal advisers. Two
internal subcommittees are made up of City members to provide direction on underwriting and
CITY OF TUSTIN
Notes to Financial Statements (Continued)
June 30, 2010
claims activities. The Governing Board of CIPA is comprised of one member from each
participating City and is responsible for the selection of the independent general manager, legal
counsel, and electing subcommittee members. The financial statements of the CEPA are available at
the administrative office located at 240 Newport Center Drive, Suite 210, Newport Beach,
California.
The government retains a risk of loss, due to the fact that actual losses may exceed estimated claims
or coverage amounts. Settled claims have not exceeded any of the City's coverage amounts in any
of the last three fiscal years, and there were no reductions in the City's coverage during the year
ended June 30, 2010. At June 30, 2010, estimated claims payable of $2,240,963, which includes a
provision for incurred but not reported claims and loss adjustment expenses, are reported as a long-
term liability.
Changes in the balances of claims liabilities for the years ended June 30, 2009 and 2010, including
a provision for incurred but not reported claims and loss adjustment expenses, were as follows:
June 30,
2009
2010
Balance
$ 1,936,188
1,939,920
Estimates Payments Balance
$ 3,148,268 $ 3,144,536 $ 1,939,920
1,342,669 1,041,626 2,240,963
(d) Special Assessment Districts' Bonds
Special assessment districts exist in various parts of the City to provide improvements to properties
located in those districts. Properties are assessed for the cost of improvements; these assessments
are payable over the term of the debt issued to finance the improvements and must be sufficient to
repay this debt. The bonds listed below were issued pursuant to the Refunding Act of 1984 for the
1915 Improvement Act Bonds and the Improvement Bond Act of 1915 and are the liabilities of the
property owners and are secured by liens against the assessed property. The City Treasurer acts as
an agent for collection of principal and interest payments by the property owners and remittance of
such monies to bondholders.
Neither the faith and credit nor the general taxing power of the City have been pledged to the
payment of the bonds. Therefore, none of the following special assessment bonds have been
included in the accompanying financial statements.
CITY OF TUSTIN
Notes to Financial Statements (Continued)
June 30, 2010
Tustin Public Financing Authority
In February 1999, the Tustin Public Financing Authority (PFA) issued $35,705,000 of Revenue
Bonds, Series A, to facilitate the issuance of the $35,705,000 of Assessment District Bonds for
Reassessment District 95-1. The proceeds of the PFA bonds were used to purchase certain limited
obligation bonds of Reassessment District 95-1. At June 30, 2010, the amount of the PFA Revenue
Bonds, Series A, outstanding was $11,050,000.
In February 1996, the PFA issued $41,500,000 of Limited Obligation Improvement Bonds, Series
A. The proceeds from the sale of the Series A Bonds were used to refund outstanding limited
obligation improvement bonds of the City for Assessment District 85-1 and Assessment District 86-
2. At June 30, 2010, the amount of the PFA Limited Obligation Improvement Bonds, Series A,
outstanding was $26,760,000.
In November 1997, the PFA issued $3,300,000 of Revenue Bonds, Series B, to facilitate the
issuance of the $3,300,000 of Assessment District bonds for Reassessment District 95-2.. The
proceeds were used to purchase the entire issue of limited obligation bonds of the Reassessment
District 95-2. The 95-2 Assessment bonds (issued October 1997 and concurrently sold to the PFA)
were issued for the purpose of refunding a portion of the 1996 Assessment bonds 95-2. At June 30,
2010, the amount of the PFA Revenue Bonds, Series B, outstanding was $1,070,000.
In November 1998, the PFA issued $4,185,000 of Revenue Bonds, Series C, to facilitate the
issuance of the $4,185,000 of Assessment District bonds for Reassessment District 95-2. The
proceeds were used to purchase the entire issue of limited obligation bonds of the Reassessment
District 95-2. The 95-2 Assessment bonds (issued December 1998 and concurrently sold to the
PFA) were issued for the purpose of refunding a portion of the 1996 Assessment Bonds 95-2 bonds.
The net proceeds of $4,135,943 were used to refund $3,648,000 of Assessment District 95-2
bonds. As a result, a portion of the Assessment District 95-2 bonds are considered to be defeased.
At June 30, 2010, the amount of the PFA Revenue Bonds, Series C, outstanding was $1,595,000.
Amount
Outstanding
District Bonds
of Issue
June 30, 2010
Assessment District 95-1
$ 35,705,000
$ 11,050,000
Assessment District 95-2, 1996
41,500,000
26,760,000
Assessment District 95-2, 1997
3,300,000
1,070,000
Assessment District 95-2, 1998
4,185,000
1,595,000
Assessment District 95-2, 1999
4,995,000
1,760,000
Assessment District 95-2, 2001
2,245,000
900,000
Community Facilities District 04-1, 2004
11,415,000
10,565,000
Community Facilities District 06-1, 2007
53,570,000
53,530,000
Community Facilities District 07-1, 2007
13,680,000
13,675,000
Total
$ 170,595,000
$ 120,905,000
Tustin Public Financing Authority
In February 1999, the Tustin Public Financing Authority (PFA) issued $35,705,000 of Revenue
Bonds, Series A, to facilitate the issuance of the $35,705,000 of Assessment District Bonds for
Reassessment District 95-1. The proceeds of the PFA bonds were used to purchase certain limited
obligation bonds of Reassessment District 95-1. At June 30, 2010, the amount of the PFA Revenue
Bonds, Series A, outstanding was $11,050,000.
In February 1996, the PFA issued $41,500,000 of Limited Obligation Improvement Bonds, Series
A. The proceeds from the sale of the Series A Bonds were used to refund outstanding limited
obligation improvement bonds of the City for Assessment District 85-1 and Assessment District 86-
2. At June 30, 2010, the amount of the PFA Limited Obligation Improvement Bonds, Series A,
outstanding was $26,760,000.
In November 1997, the PFA issued $3,300,000 of Revenue Bonds, Series B, to facilitate the
issuance of the $3,300,000 of Assessment District bonds for Reassessment District 95-2.. The
proceeds were used to purchase the entire issue of limited obligation bonds of the Reassessment
District 95-2. The 95-2 Assessment bonds (issued October 1997 and concurrently sold to the PFA)
were issued for the purpose of refunding a portion of the 1996 Assessment bonds 95-2. At June 30,
2010, the amount of the PFA Revenue Bonds, Series B, outstanding was $1,070,000.
In November 1998, the PFA issued $4,185,000 of Revenue Bonds, Series C, to facilitate the
issuance of the $4,185,000 of Assessment District bonds for Reassessment District 95-2. The
proceeds were used to purchase the entire issue of limited obligation bonds of the Reassessment
District 95-2. The 95-2 Assessment bonds (issued December 1998 and concurrently sold to the
PFA) were issued for the purpose of refunding a portion of the 1996 Assessment Bonds 95-2 bonds.
The net proceeds of $4,135,943 were used to refund $3,648,000 of Assessment District 95-2
bonds. As a result, a portion of the Assessment District 95-2 bonds are considered to be defeased.
At June 30, 2010, the amount of the PFA Revenue Bonds, Series C, outstanding was $1,595,000.
CITY OF TUSTIN
Notes to Financial Statements (Continued)
June 30, 2010
In November 1999, the PFA issued $4,995,000 of Revenue Bonds, Series D, to facilitate the
issuance of the $4,995,000 of Assessment District bonds for Reassessment District 95-2. The
proceeds were used to purchase the entire issue of limited obligation bonds of the Reassessment
District 95-2. The 95-2 Assessment bonds (issued November 1999 and concurrently sold to the
PFA) were issued for the purpose of refunding a portion of the 1996 Assessment Bonds 95-2. The
net proceeds of $4,937,880 were used to refund $4,323,000 of Assessment District 95-2 bonds. As
a result, a portion of the Assessment District 95-2 bonds are considered to be defeased. At June 30,
2010, the amount of the PFA Revenue Bonds, Series D, outstanding was $1,760,000.
In October 2001, the PFA issued $2,245,000 of Revenue Bonds, Series E, to facilitate the issuance
of the $2,245,000 of Assessment District bonds for Reassessment District 95-2. The proceeds were
used to purchase the entire issue of limited obligation bonds of the Reassessment District 95-2. The
95-2 Assessment bonds (issued October 2001 and concurrently sold to the PFA) were issued for the
purpose of refunding a portion of the 1996 Assessment Bonds 95-2. The net proceeds of
$2,223,063 were used to refund $1,970,000 of Assessment District 95-2 bonds. As a result, a
portion of the Assessment District 95-2 bonds are considered defeased. At June 30, 2010, the
amount of the PFA Revenue Bonds, Series E, outstanding was $900,000.
Community Facilities District
In December 2004, the City issued $11,415,000 of Special Tax Bonds, Series 2004, to facilitate the
new infrastructure construction on the former MCAB being converted into various public, housing,
commercial and educational uses. The proceeds of the bonds will be used to pay the cost and
expense of acquisition and construction of certain public facilities necessary for the development of
the Tustin Legacy District, fund the reserve account, pay capitalized interest on bonds through
September 16, 2005, and pay costs of issuing the Series 2004 Bonds. Serial current interest bonds
will mature from September 1, 2006 to September 1, 2025. Term current interest bonds will mature
on September 1, 2029, with mandatory sinking payments from September 1, 2030 through
September 1, 2034. Interest maturity rates of the current interest bonds range from 2.75% at
September 1, 2006 to 5.35% at September 1, 2025 - and current term interest bonds are 5.375% and
5.50% on their respective maturity dates. At June 30, 2010, the amount of the Special Tax Bonds,
Series 2004 was $10,565,000.
In September 2007, the City issued $53,570,000 of Special Tax Bonds, Series 2007A, to facilitate
the new infrastructure construction on the former MCAB being converted into various public,
housing, commercial and educational uses. The proceeds of the bonds will be used to pay the cost
and expense of acquisition and construction of certain public facilities necessary for the
development of the Tustin Legacy District, fund the reserve account, pay capitalized interest on
bonds through September 1, 2008, and pay costs of issuing the Series 2007A Bonds. Serial current
interest bonds will mature from September 1, 2009 to September 1, 2025. Term current interest
bonds will mature on September 1, 2036, with mandatory sinking payments from September 1,
2026 through September 1, 2036. Interest maturity rates of the current interest bonds range from
4% at September 1, 2009 to 5.375% at September 1, 2025 and current term interest bonds are 6%
on their respective maturity dates. The first principal payment was due on September 1, 2009. At
CITY OF TUSTIN
Notes to Financial Statements (Continued)
June 30, 2010
June 30, 2010, the amount of the Special Tax Bonds, Series 2004 was $53,530,000.
In September 2007, the City issued $13,680,000 of Special Tax Bonds, Series 2007, to facilitate the
new infrastructure construction on the former MCAB being converted into various public, housing,
commercial and educational uses. The proceeds of the bonds will be used to pay the cost and
expense of acquisition and construction of certain public facilities necessary for the development of
the Tustin Legacy District, fund the reserve account, and pay costs of issuing the Series 2007
Bonds. Serial current interest bonds will mature from September 1, 2009 to September 1, 2025.
Term current interest bonds will mature on September 1, 2037, with mandatory sinking payments
from September 1, 2026 through September 1, 2037. Interest maturity rates of the current interest
bonds range from 4% at September 1, 2009 to 5.65% at September 1, 2025 and current term interest
bonds are 6% through their respective maturity dates. The first principal payment was due on
September 1, 2009. At June 30, 2010, the amount of the Special Tax Bonds, Series 2004 was
$13,675,000.
Neither the general taxing power of the City nor the faith or credit of the PFA or the City have been
pledged to the payment of the bonds. Therefore, the bonds have not been included in the
accompanying financial statements.
(e) Commitments and Contingencies
There are certain legal actions pending against the City which have arisen in the normal course of
operations. In the opinion of management and the City Attorney, the ultimate resolution of such
actions is not expected to have a significant impact, if any, on the financial statements or operations
of the City.
The California Health and Safety Code requires redevelopment agencies to set aside 20 percent of
their tax increment from project areas established before 1976 for low and moderate income
housing. Between fiscal years 1985-86 and 1991-92, the Tustin Community Redevelopment
Agency deferred a total of $2,776,042 from its low and moderate -income housing obligation, and is
the amount outstanding as of June 30, 2010.
09 City and Agency Reimbursement Agreement
On June 5, 2007, the City and Agency executed a Reimbursement Agreement for reimbursement to
the City to assist the Agency in meeting obligations to provide affordable housing under the WAS
Redevelopment Plan and the MCAS Tustin Specific Plan. In order to assist the Agency in meeting
its affordable housing obligations, the City entered into an agreement to sell property at a discount
sufficient to permit developers to economically develop the required number of affordable housing
units and has encumbered the sale of the properties and units with covenants, promissory notes and
deeds of trust to ensure maintaining the affordability of those units in accordance with the
California Community Redevelopment Law.
CITY OF TUSTIN
Notes to Financial Statements (Continued)
June 30, 2010
As of June 30, 2010, approximately five hundred sixty-five new units have been constructed in the
MCAS Tustin Project Area, including one hundred eighteen affordable units, which reflect an
average subsidy of $351,000 per unit to secure the long-term affordability covenants. The
affordable units are located at Tustin Fields I and II and are comprised of thirty-three very low,
twenty-three low and sixty-two moderate income units, which are secured by promissory notes and
deeds of trusts by the City that reflect an average of approximately $502,600 for very low-income
units, $485,900 for low-income units and $279,100 for moderate -income units. The City's
promissory notes and deeds of trust reflect the difference between the fair market value of the
dwelling unit at the time of purchase and the affordable housing purchase price of the units. The
total promissory notes value associated with the production of the affordable housing units is
$23,585,726 on Tustin Field I and $22,822,010 on Tustin Field H, for a total of $46,407,736.
Reimbursements are to be paid from tax increment revenues, including but not limited to the
Agency's Low and Moderate -Income Housing Set -Aside deposits from the MCAS Tustin Project
Area, Town Center and South Central Project Areas as determined on an annual basis as part of the
budget process. During the fiscal year 2010, the Agency reimbursed the City $16,597,185 from the
Low Income Housing Fund and $8,841,394 from the Marine Base Low Income Housing Fund. The
reimbursement amounts were recorded as a transfer in the accompanying financial statements.
Interest paid by the Agency during the fiscal year to the City was as follows: $1,087,626 by the
Marine Base Low Income Housing Fund and $1,003,962 by the Low Income Housing Fund. This
obligation is expected to increase in future years. Since the obligation is contingent upon future tax
increment revenues, only actual payments by the Agency to the City are recorded in the
accompanying financial statements.
(g) Restatement of Net Assets
Governmental Activities
Net assets as of June 30, 2009, as originally reported $ 606,938,897
Correct capital assets that were understated in prior years 1,300,000
Net assets as of June 30, 2009, as restated $ 608,238,897
This restatement was necessary to correct capital assets that were understated in prior years (see
Note 3(f).).
Business -type Activities — Water Enterprise Fund
Net assets as of June 30, 2009, as originally reported $ 28,138,017
Correct capital assets that were overstated in prior years (513,557)
Net assets as of June 30, 2009, as restated $ 27,624,460
This restatement was necessary to correct capital assets that were overstated in prior years (see Note
3(f).).
CITY OF TUSTIN
Notes to Financial Statements (Continued)
June 30, 2010
(5) SUBSEQUENT EVENTS
$44,170,000 Tustin Community Redevelopment Agency Tax Allocation Bonds, Series 2010
On October 27, 2010, the Agency issued $44,170,000 Tax Allocation Bonds, Series 2010 for the
purpose of financing redevelopment activities within or for the benefit of the Agency's MCAS -
Tustin Redevelopment Project Area. The bonds are payable in annual installments ranging from
$640,000 to $12,230,000 commencing on September 1, 2011. Interest is payable semiannually on
March 1 and September 1, with rates ranging from 2.0% to 5.0% per annum. The bonds maturing
on or after September 1, 2019, are subject to optional redemption prior to maturity, as a whole or in
part, from any available source of funds, at a redemption price equal to the principal amount
thereof, together with accrued interest to the date fixed for redemption, without premium.
$1,675,000 City of Tustin Community Facilities District No. 06-1 (Tustin Legacy/Columbus
Villages) Special Tax Bonds, Series 2010
In November 2010, the City issued $1,675,000 Special Tax Bonds, Series 2010 to pay the cost and
expense of acquisition and construction of certain public facilities necessary for the development of
the City of Tustin Community Facilities District No. 06-1, to pay certain administrative expenses
relating to the Series 2010 Bonds, and to pay the costs of issuing the Series 2010 Bonds. Serial
bonds will mature from September 1, 2011 to September 1, 2035. Tenn bonds will mature on
September 1, 2039, with mandatory sinking payments from September 1, 2036 through September
1, 2039. Interest maturity rates of the serial bonds range from 1.5% at September 1, 2011 to
5.625% at September 1, 2035 and the interest of the tern bonds are 5.75% on their respective
maturity dates. The first principal payment will be due on September 1, 2011.
REQUIRED SUPPLEMENTARY INFORMATION
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CITY OF TUSTIN
Schedule of Funding Progress for PERS and
Schedule of Funding Progress for Postemployment Benefits
June 30, 2010
Schedule of Funding Progress for PERS
Actuarial Actuarial
Valuation Value of
Date Assets
(A)
Miscellaneous Employees:
6/30/07 $51,219,115
Actuarial
Accrued
UAAL as
Liability
Unfunded
a % of
(AAL)
AAL
Funded Covered
Covered
Entry Age
(UAAL)
Ratio Payroll
Payroll
(B)
(B -A)
(A/B) (C)
[(B-A)/C]
$53,443,514 $ 2,224,399 95.8% $12,613,344
6/30/08 55,906,203 58,955,701 3,049,498 94.8% 14,416,837
17.60%
21.20%
6/30/09 59,641,991 64,934,473 5,292,482 91.8% 14,785,480 35.80%
Schedule of Funding Progress for Postemployment Benefits
Schedule of Funding Progress:
6/1/07 $ - $13,602,031 $13,602,031 0.0% $21,886,909 62.15%
6/30/10 - 13,626,000 13,626,000 0.0% 23,100,000 58.90%
CITY OF TUSTIN
Budgetary Comparison Schedule
General Fund
For the Year Ended June 30, 2010
See Accompanying Note to Required Supplementary Information.
Variance
Budgeted Amounts
Positive
Original
Final
Actual
(Negative)
Revenues:
Taxes
$ 36,380,400
$ 36,380,400
$ 33,891,993
$ (2,488,407)
Licenses and permits
656,100
656,100
397,896
(258,204)
Fines and forfeitures
741,900
741,900
890,770
148,870
Use of money and property
333,000
333,000
2,278,358
1,945,358
Intergovernmental revenue
1,113,492
1,113,492
1,274,795
161,303
Charges for services
3,432,900
3,432,900
5,746,442
2,313,542
Rental income
99,300
99,300
385,358
286,058
Otherrevenues
1,346,900
1,346,900
555,149
(791,751)
Total revenues
44,103,992
44,103,992
45,420,761
1,316,769
Expenditures:
Current:
General government
7,651,402
7,701,402
7,152,834
548,568
Public safety
28,187,300
28,187,300
26,247,277
1,940,023
Public works
11,590,558
11,590,558
10,133,685
1,456,873
Community services
2,914,900
2,914,900
2,680,082
234,818
Capital outlay
893,900
1,091,000
1,014,385
76,615
Debt Service:
Interest and fiscal charges
-
-
828,285
(828,285)
Total expenditures
51,238,060
51,485,160
48,056,548
3,428,612
Excess of revenues over
(under) expenditures
(7,134,068)
(7,381,168)
(2,635,787)
4,745,381
Other financing sources (uses):
Transfers in
6,680,200
6,680,200
28,482,712
21,802,512
Sale of property
17,400
17,400
7,421
(9,979)
Total other financing
sources (uses)
6,697,600
6,697,600
28,490,133
21,792,533
Net change in fund balance
(436,468)
(683,568)
25,854,346
26,537,914
Fund balance, beginning
124,155,813
124,155,813
124,155,813
-
Fund balance, ending
$ 123,719,345
$ 123,472,245
$ 150,010,159
$ 26,537,914
See Accompanying Note to Required Supplementary Information.
CITY OF TUSTIN
Note to Required Supplementary Information
June 30, 2010
(1) BUDGETS AND BUDGETARY ACCOUNTING:
The City follows these procedures in establishing the budgets.
(a) The annual budget is adopted by the City Council after the holding of a hearing and provides for
the general operation of the City. The operating budget includes proposed expenditures and the
means of financing them.
(b) The City Council approves total budgeted appropriations and any amendments to appropriations
throughout the year. The City Manager is authorized to transfer budgeted amounts between
departments. Actual expenditures may not exceed budgeted appropriations at the fund level.
Budget figures used in the accompanying budgetary comparison schedule are the final adjusted
amounts.
(c) Formal budgetary integration is employed as a management control device during the year.
Commitments for materials and services, such as purchase orders and contracts, are recorded as
encumbrances to assist in controlling expenditures. Capital projects appropriations are an
automatic supplemental appropriation for the next year. All others lapse unless they are
encumbered at year-end or re -appropriated through the formal budget process. There were no
outstanding encumbrances at year-end.
(d) Annual budgets are adopted for the General and Special Revenue Funds on a basis substantially
consistent with accounting principles generally accepted in the United States of America.
Accordingly, actual revenues and expenditures can be compared with related budgeted amounts
without any significant reconciling items.
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SUPPLEMENTARY INFORMATION
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NONMAJOR SPECIAL REVENUE FUNDS
Gas Tax - This fund accounts for revenues and expenditures apportioned under the Street and Highways Code
of the State of California. Expenditures may be made for any street -related purpose allowable under the Code.
Measure M — This fund is used to account for monies received from the County for street projects.
Park Acquisition and Development - This fund is used to account for fees received from developers to develop
the City's park system.
Asset Forfeiture - This fund is used to account for monies receivers from the Federal government that are used
for special law enforcement purchases.
Air Ouality - This fund is used to account for funds received from South Coast Air Quality Management
District to be used for reducing pollution.
Supplemental Law Enforcement - This law was established under Government Code Section 30061 enacted
by AB3229, Chapter 134, of the 1996 Statutes and is an appropriation from the State Budget for the "Citizen
Option for Public Safety Program." This fund can only be used for police front line municipal activities that
provide police services to the City in prevention of drug abuse, crime prevention, and community awareness
programs.
NONMAJOR DEBT SERVICE FUNDS
Town Center Project Area - This fund records the accumulation and disbursement of monies to meet the
debt service requirements of the Town Center Redevelopment Project.
NONMAJOR CAPITAL PROJECTS FUNDS
Other Capital Projects — This fund is used to account for capital projects which are not funded by a specific
source.
Construction 95-1 - This fund accounts for infrastructure improvements to the Tustin 95-1 Area.
Town Center Project Area - This fund accounts for acquisition and construction activity in the Town Center
Redevelopment Project Area.
Low Income Hous ine - This fund accounts for acquisition and construction activity for low income housing to
residents of South Central and Town Center Project Areas. As prescribed by the California Health and Safety
Code, 20% of Redevelopment Agency tax increment revenue is set aside in this fund for the purpose of low
income housing development.
Marine Base Proiect Area — This fund accounts for acquisition and construction activity in the Marine Base
Redevelopment Project Area.
South Central Project Area — This fund accounts for acquisition and construction activity in the South Central
Redevelopment Project Area.
Marine Base Low Income Housine - This fund accounts for acquisition and construction activity for low
income housing. As prescribed by the California Health and Safety Code, 20% of Redevelopment Agency tax
increment revenue is set aside in this fund for the purpose of low income housing development.
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CITY OF TUSTIN
Combining Balance Sheet
Nonmajor Governmental Funds
June 30, 2010
Assets:
Cash and investments
Cash and investments with fiscal agents
Receivables:
Accounts receivable
Interest receivable
Loans receivable
Allowance for uncollectibles
Advances to other funds
Prepaid items and deposits
Land held for resale
Total assets
Special Revenue Funds
Park
Acquisition and
Gas Tax Measure M Development
$ 3,346,686 $ 1,522,329 $ 8,873,472
321,014 151,164 20,195
10,427 4,743 27,645
$ 3,678,127 $ 1,678,236 $ 8,921,312
Liabilities and fund balances:
Liabilities:
Accounts payable and accrued liabilities $ 83,398 $ 42,730 $ 14,881
Due to other funds _ _ _
Deposits payable _ _ _
Deferred revenue 5,715 114,875 16,412
Total liabilities
Fund balances:
Reserved for:
Advances to other funds
Prepaid items and deposits
Land held for resale
Low and moderate income housing
Unreserved reported in:
Special revenue funds
Debt service funds
Capital projects funds
89,113 157,605 31,293
3,589,014
1,520,631
8,890,019
Total fund balances
3,589,014
1,520,631
8,890,019
Total liabilities and fixnd balances $
3,678,127 $
1,678,236 $
8,921,312
Debt Capital
Special Revenue Funds Service Fund Projects Funds
Supplemental Town Other
Asset Air Law Center Capital Projects
Forfeiture Quality Enforcement Project Area Fund
$ 152,893 $ 153,674 $ - $ - $ 12,713,472
1 700 253 -
476
22,752
479
$ 153,369 $ 176,905 $
56,278
261
56,539
33,736 21,138 1,359,087
- - 39,610
6,704,152 2,141,191
33,736 $ 8,425,543 $ 16,253,360
- $ 1,430 $ 558 $ 282,837
- 16,108 - -
262 11,652 410,236 1,391,861
262 29,190 410,794 1,674,698
_ 6,293,918 2,123,437
96,830 176,643 4,546 - -
- - - 1,720,831 -
_ - 12,455,225
96,830 176,643 4,546 8,014,749 14,578,662
$ 153,369 $ 176,905 $ 33,736 $ 8,425,543 $ 16,253,360
(Continued)
CITY OF TUSTIN
Combining Balance Sheet (Continued)
Nonmajor Governmental Funds
June 30, 2010
Capital Projects Funds
Town
Low
Construction
Center
Income
95-1
Project Area
Housing
Assets:
Cash and investments
$ 1,371,984
$ 4,830,627
$
14,302,292
Cash and investments with fiscal agents
3,864,504
-
1,248,334
Receivables:
Accounts receivable
-
-
32,646
Interest receivable
-
15,052
75,871
Loans receivable
-
-
1,094,306
Allowance for uncollectibles
-
-
(720,342)
Advances to other funds
-
-
-
Prepaid items and deposits
-
1,416
30,330
Land held for resale
-
-
-
Total assets
$ 5,236,488
$ 4,847,095
$
16,063,437
Liabilities and fund balances:
Liabilities:
Accounts payable and accrued liabilities
$ -
$ 7,789
$
6,895
Due to other funds
-
-
-
Deposits payable
-
-
9,050
Deferred revenue
-
8,249
398,367
Total liabilities
-
16,038
414,312
Fund balances:
Reserved for:
Advances to other fimds
-
-
-
Prepaid items and deposits
-
1,416
30,330
Land held for resale
-
-
-
Low and moderate income housing
-
-
15,618,795
Unreserved reported in:
Special revenue funds
-
-
-
Debt service funds
-
-
-
Capital projects funds
5,236,488
4,829,641
-
Total fund balances
5,236,488
4,831,057
15,649,125
Total liabilities and fund balances
$ 5,236,488
$ 4,847,095
$
16,063,437
Capital Projects Funds
Marine Base
Marine Base South Central Low Income
Project Area Project Area Housing
Total
Nonmajor
Funds
$ 2,555,256 $ 14,211,044 $ 2,938,465 $ 66,972,194
- - 624,167 7,437,258
8,669 1,568 40,588 2,012,557
7,962 44,274 9,155 235,694
- - - 1,094,306
- (720,342)
- 8,845,343
1,581 5,056 - 38,383
25,000,000 1,345,000 - 26,345,000
$ 27,573,468 $ 15,606,942 $ 3,612,375 $ 112,260,393
$ 188,256 $ 96,271 $ 5,457 $ 730,502
- - - 16,108
1,000 - - 66,328
4,363 24,268 5,018 2,391,539
193,619 120,539 10,475 3,204,477
- _ - 8,417,355
1,581 5,056 - 38,383
25,000,000 1,345,000 - 26,345,000
- - 3,601,900 19,220,695
_ 14,277,683
- - - 1,720,831
2,378,268 14,136,347 - 39,035,969
27,379,849 15,486,403 3,601,900 109,055,916
$ 27,573,468 $ 15,606,942 $ 3,612,375 $ 112,260,393
CITY OF TUSTIN
Combining Statement of Revenues, Expenditures and
Changes in Fund Balances - Nonmajor Governmental Funds
For the Year Ended June 30, 2010
Revenues:
Taxes
Use of money and property
Intergovernmental revenue
Charges for services
Rental income
Developer contribution
Otherrevenue
Total revenues
Expenditures:
Current:
General government
Public safety
Community services
Capital outlay
Debt service:
Principal
Interest and fiscal charges
Total expenditures
Excess of revenues over
(under) expenditures
Other financing sources (uses):
Transfers in
Transfers out
Premium on bonds
Bond proceeds
Total other financing sources (uses)
Special Revenue Funds
Park
Acquisition and
Gas Tax Measure M Development
37,445 12,612 86,665
2,249,461 983,372 43,552
- - 15,840
383,963
2,286,906 995,984 530,020
1,633,852 342,476 3,086,453
1,633,852 342,476 3,086,453
653,054 653,508 (2,556,433)
4,732 -
(1,057,569) -
(1,052,837) -
Net changes in fund balance 653,054 (399,329) (2,556,433)
Fund balances (deficits), beginning 2,935,960 1,919,960 11,446,452
Fund balances, ending $ 3,589,014 $ 1,520,631 $ 8,890,019
44,875 - - -
- 112,158 -
_ _ - 1,956,846 -
- 82,362 - 4,318,679
Debt
Capital
Special
Revenue Funds
Service Fund
Projects Funds
-
44,875
Supplemental
Town
Other
Asset
Air
Law
Center
Capital Projects
Forfeiture
Quality
Enforcement
Project Area
Fund
1,057,569
-
$ _
$ _
$ -
$ 3,841,365
$ -
1,237
1,635
4
102,491
152,564
72,454
-
220,601
-
1,007,368
-
86,725
-
-
-
$ 14,578,662
2,806,936
_
-
-
-
367,921
73,691
88,360
220,605
3,943,856
4,334,789
44,875 - - -
- 112,158 -
_ _ - 1,956,846 -
- 82,362 - 4,318,679
1,150,000
-
-
-
-
500,452
-
44,875
-
194,520
3,607,298
4,318,679
28,816
88,360
26,085
336,558
16,110
_
_
-
5,045,432
1,057,569
-
(2,004,733)
-
-
-
5,045,432
(947,164)
28,816
88,360
26,085
5,381,990
(931,054)
68,014
88,283
(21,539)
2,632,759
15,509,716
$ 96,830 $
176,643 $
4,546 $
8,014,749
$ 14,578,662
(Continued)
CITY OF TUSTIN
Combining Statement of Revenues, Expenditures and
Changes in Fund Balances - Nonmajor Governmental Funds (Continued)
For the Year Ended June 30, 2010
Revenues:
Taxes
Use of money and property
Intergovernmental revenue
Charges for services
Rental income
Developer contribution
Otherrevenue
Total revenues
Expenditures:
Current:
General government
Public safety
Community services
Capital outlay
Debt service:
Principal
Interest and fiscal charges
Total expenditures
Excess of revenues over
(under) expenditures
Other financing sources (uses):
Transfers in
Transfers out
Premium on bonds
Bond proceeds
Total other financing sources (uses)
Net changes in fund balance
Fund balances (deficits), beginning
Fund balances, ending
Capital Projects Funds
Town Low
Construction Center Income
95-1 Project Area Housing
$ - $ - $ 1,859,349
4,660 88,704 159,391
- - 85,324
1,244,244 - -
- - 27,203
1,248,904 88,704 2,131,267
- 147,719 404,178
1,618,342
- 147,719 2,022,520
1,248,904 (59,015) 108,747
- (5,045,432) (16,597,184)
69,470
17,446,667
- (5,045,432) 918,953
1,248,904 (5,104,447) 1,027,700
3,987,584 9,935,504 14,621,425
$ 5,236,488 $ 4,831,057 $ 15,649,125
Capital Projects Funds
Marine Base
Marine Base South Central Low Income
Project Area Project Area Housing
Total
Nonmajor
Funds
$ _ $ - $ 2,384,523 $ 8,085,237
49,656 184,207 32,974 914,245
- 4,576,808
102,565
- 15,000 - 484,287
- 4,051,180
78,159 - 473,283
127,815 199,207 2,417,497 18,687,605
44,875
- 112,158
1,216,183 235,780 291,435 4,252,141
- 1,254,724 - 10,718,546
_
_
_
1,150,000
134
-
1,390,385
3,509,313
1,216,317
1,490,504
1,681,820
19,787,033
(1,088,502)
(1,291,297)
735,677
(1,099,428)
-
6,107,733
(3,661,349)
-
(8,841,394)
(37,207,661)
-
-
34,735
104,205
-
-
8,723,333
26,170,000
(3,661,349)
-
(83,326)
(4,825,723)
(4,749,851)
(1,291,297)
652,351
(5,925,151)
32,129,700
16,777,700
2,949,549
114,981,067
$ 27,379,849 $ 15,486,403 $ 3,601,900 $ 109,055,916
Revenues:
Use of money and property
Intergovernmental revenue
Total revenues
Expenditures:
Capital outlay
Excess of revenues over
(under) expenditures
Other financing uses:
Transfers out
Net change in fund balance
Fund balance, beginning
Fund balance, ending
CITY OF TUSTIN
Budgetary Comparison Schedule
Gas Tax Special Revenue Fund
For the Year Ended June 30, 2010
Budgeted Amounts
Original Final
Variance
Positive
Actual (Negative)
$ 18,600 $ 18,600 $ 37,445 $ 18,845
3,384,500 3,384,500 2,249,461 (1,135,039)
3,403,100 3,403,100 2,286,906 (1,116,194)
4,699,411 4,699,411 1,633,852 3,065,559
(1,296,311) (1,296,311)
(590,000) (590,000)
(1,886,311) (1,886,311)
653,054 1,949,365
- 590,000
653,054
2,935,960 2,935,960 2,935,960
2,539,365
$ 1,049,649 $ 1,049,649 $ 3,589,014 $ 2,539,365
Revenues:
Use of money and property
Intergovernmental revenue
Total revenues
Expenditures:
Capital outlay
Excess of revenues over
(under) expenditures
Other financing sources (uses):
Transfers in
Transfers out
Other financing sources (uses)
Net change in fund balance
CITY OF TUSTIN
Budgetary Comparison Schedule
Measure M Special Revenue Fund
For the Year Ended June 30, 2010
Budgeted Amounts
Original Final _
$ 9,000 $ 9,000 $
1,481,000 1,481,000
1,490,000 1,490,000
50,000 50,000 342,476 (292,476)
1,440,000 1,440,000
653,508 (786,492)
_ 4,732
Variance
(1,326,671) (1,326,671) (1,057,569)
Positive
Actual
(Negative)
273,834
$ 1,520,631 $ (512,658)
12,612
$ 3,612
983,372
(497,628)
995,984
(494,016)
50,000 50,000 342,476 (292,476)
1,440,000 1,440,000
653,508 (786,492)
_ 4,732
4,732
(1,326,671) (1,326,671) (1,057,569)
269,102
Fund balance, ending
(1,326,671) (1,326,671) (1,052,837)
273,834
$ 1,520,631 $ (512,658)
113,329 113,329 (399,329)
(512,658)
Fund balance, beginning
1,919,960
1,919,960
1,919,960 -
Fund balance, ending
$ 2,033,289
$ 2,033,289
$ 1,520,631 $ (512,658)
CITY OF TUSTIN
Budgetary Comparison Schedule
Park Acquisition and Development Special Revenue Fund
For the Year Ended June 30, 2010
Revenues:
Use of money and property
Intergovernmental revenue
Charges for services
Rental income
Total revenues
Expenditures:
Capital outlay
Excess of revenues over
(under) expenditures
_ Budgeted Amounts
Original Final
$ 122,000 $ 122,000
13,000 13,000
135,000
135,000
2,680,281 2,680,281
(2,545,281) (2,545,281)
Other financing uses:
Transfers out (650,000) (650,000)
Net change in fund balance (3,195,281) (3,195,281)
3,086,453 (406,172)
(2,556,433) (11,152)
650,000
(2,556,433) 638,848
Fund balance, beginning
Variance
11,446,452
Positive
Actual
(Negative)
$ 8,251,171
$ 86,665
$ (35,335)
43,552
43,552
15,840
2,840
383,963
383,963
530,020
395,020
3,086,453 (406,172)
(2,556,433) (11,152)
650,000
(2,556,433) 638,848
Fund balance, beginning
11,446,452
11,446,452
11,446,452 -
Fund balance, ending
$ 8,251,171
$ 8,251,171
$ 8,890,019 $ 638,848
CITY OF TUSTIN
Budgetary Comparison Schedule
Asset Forfeiture Special Revenue Fund
For the Year Ended June 30, 2010
R7
Variance
Budgeted Amounts
Positive
Original
Final
Actual
(Negative)
Revenues:
Use of money and property
$ 1,300 $
1,300
$ 1,237
$ (63)
Intergovernmental revenue
50,000
50,000
72,454
22,454
Total revenues
51,300
51,300
73,691
22,391
Expenditures:
General government
35,000
50,000
44,875
5,125
Net change in fund balance
16,300
1,300
28,816
27,516
Fund balance, beginning
68,014
68,014
68,014
-
Fund balance, ending
$ 84,314 $
69,314
$ 96,830
$ 27,516
R7
CITY OF TUSTIN
Budgetary Comparison Schedule
Air Quality Special Revenue Fund
For the Year Ended June 30, 2010
Revenues:
Use of money and property
Charges for services
Total revenues
Expenditures:
Capital outlay
Net change in fund balance
Variance
Budgeted Amounts Positive
Original Final Actual (Negative)
$ 100 $ 100 $ 1,635 $ 1,535
86,500 86,500 86,725 225
86,600 86,600 88,360 1,760
- 169,000 - 169,000
86,600 (82,400) 88,360 170,760
Fund balance, beginning
88,283
88,283
88,283 -
Fund balance, ending
$ 174,883 $
5,883 $
176,643 $ 170,760
R 5
CITY OF TUSTIN
Budgetary Comparison Schedule
Supplemental Law Enforcement Special Revenue Fund
For the Year Ended June 30, 2010
Variance
Budgeted Amounts Positive
Original Final Actual (Negative)
Revenues:
Use of money and property $ - $ - $ 4 $ 4
Intergovernmental revenue 220,000 220,000 220,601 601
Total revenues 220,000 220,000 220,605 605
Expenditures:
Public safety
120,000
120,000
112,158
7,842
Capital outlay
-
64,400
82,362
(17,962)
Total expenditures
120,000
184,400
194,520
(10,120)
Net change in fund balance
100,000
35,600
26,085
(9,515)
Fund balance (deficit), beginning
(21,539)
(21,539)
(21,539)
-
Fund balance, ending $
78,461 $
14,061 $
4,546 $
9,515
AGENCY FUNDS
Assessment District 95-1 - This fund records the deposit of monies held to pay the debt service requirements
of the assessment district.
Assessment District 95-2 - This fund records the deposit of monies held to pay the debt service requirements
of the assessment district.
Community Facilities District 04-01 -This fund records the deposit of monies held to pay the debt service
requirements of the community facilities district.
Community Facilities District 06-01 - This fund records the deposit of monies held to pay the debt service
requirements of the community facilities district.
Community Facilities District 07-01 - This fund records the deposit of monies held to pay the debt service
requirements of the community facilities district.
Assets:
Cash and investments
with fiscal agents
Taxes receivable
Total assets
Liabilities:
Accounts payable
Due to the City of Tustin
Due to bondholders
Total liabilities
•.111vr ivaiJul
Combining Statement of Assets and Liabilities
All Agency Funds
June 30, 2010
Community
Community
Community
Assessment Assessment Facilities
Facilities
Facilities
District District District
District
District
95-1 95-2 04-01
06-01
07-01
Total
$ 9,395,603 $ 3,104,668 $ 3,039,780 $ 9,812,090 $ 1,833,910 $ 27,186,051
24,996 9,618 33,179 67,071 - 134,864
$ 9,420,599 $ 3,114,286 $ 3,072,959 $ 9,879,161 $ 1,833,910 $ 27,320,915
$ 26,878 $ 9,642 $ - $ 1,964 $ - $ 38,484
236,940 12,361 143,952 29,152 3,255 425,660
9,156,781 3,092,283 2,929,007 9,848,045 1,830,655 26,856,771
$ 9,420,599 $ 3,114,286 $ 3,072,959 $ 9,879,161 $ 1,833,910 $ 27,320,915
CITY OF TUSTIN
Combining Statement of Changes in Assets and Liabilities
All Agency Funds
For the Year Ended June 30, 2010
Balance Balance
Assessment District 95-1 July 1, 2009 Additions Deletions June 30, 2010
Assets:
Cash and investments
$ 12,187
$ 3,215,641
$ 3,227,828 $ -
Cash and investments
with fiscal agents
9,946,328
12,294,298
12,845,023 9,395,603
Taxes receivable
43,272
24,996
43,272 24,996
Total assets
$ 10,001,787
$ 15,534,935
$ 16,116,123 $ 9,420,599
Liabilities:
Accounts payable $ - $ 26,878 $ - $ 26,878
Due to City of Tustin - 236,940 - 236,940
Due to bondholders 10,001,787 15,271,117 16,116,123 9,156,781
Total liabilities $ 10,001,787 $ 15,534,935 $ 16,116,123 $ 9,420,599
Assessment District 95-2
Assets:
Cash and investments
$ 6,159
$ 1,335,404
$ 1,341,563 $ -
Cash and investments
with fiscal agents
2,764,648
4,163,523
3,823,503 3,104,668
Taxes receivable
35,580
9,618
35,580 9,618
Total assets
$ 2,806,387
$ 5,508,545
$ 5,200,646 $ 3,114,286
Liabilities:
Accounts payable $ - $ 1,332,343 $ 1,322,701 $ 9,642
Due to City of Tustin - 12,361 - 12,361
Due to bondholders 2,806,387 4,163,841 3,877,945 3,092,283
Total liabilities $ 2,806,387 $ 5,508,545 $ 5,200,646 $ 3,114,286
CITY OF TUSTIN
Combining Statement of Changes in Assets and Liabilities (Continued)
All Agency Funds
For the Year Ended June 30, 2010
Balance
Community Facilities District 04-01 July 1, 2009
Assets:
Deletions
Balance
June 30, 2010
Cash and investments $ 341,904 $ 1,842,195 $ 2,184,099 $ -
Cash and investments
with fiscal agents 2,806,524 3,349,982 3,116,726 3,039,780
Taxes receivable 47,906 33,179 47,906 33,179
Total assets $ 3,196,334 $ 5,225,356 $ 5,348,731 $ 3,072,959
Liabilities:
Due to City of Tustin $ - $ 143,952 $ - $ 143,952
Due to bondholders 3,196,334 5,081,404 5,348,731 2,929,007
Total liabilities $ 3,196,334 $ 5,225,356 $ 5,348,731 $ 3,072,959
Community Facilities District 06-01
Assets:
Cash and investments
$
1,228,945
$
5,624,237
$
6,853,182
$
-
Cash and investments
with fiscal agents
8,930,410
13,574,965
12,693,285
9,812,090
Taxes receivable
101,878
67,070
101,877
67,071
Total assets
$
10,261,233
$
19,266,272
$
19,648,344
$
9,879,161
Liabilities:
Accounts Payable
$
2,412
$
4,057,265
$
4,057,713
$
1,964
Due to City of Tustin
-
29,152
-
29,152
Due to bondholders
10,258,821
15,179,855
15,590,631
9,848,045
Total liabilities
$
10,261,233
$
19,266,272
$
19,648,344
$
9,879,161
(Continued)
CITY OF TUSTIN
Combining Statement of Changes in Assets and Liabilities (Continued)
All Agency Funds
For the Year Ended June 30, 2010
Balance
Community Facilities District 07-01 July 1, 2009
Assets:
Cash and investments
Cash and investments
with fiscal agents
Total assets
Liabilities:
Accounts payable
Due to City of Tustin
Due to bondholders
Total liabilities
Total - All Agency Funds
Assets:
Cash and investments
Cash and investments
with fiscal agents
Taxes receivable
Total assets
Liabilities:
Accounts payable
Due to the City of Tustin
Due to bondholders
Total liabilities
Additions
Balance
June 30, 2010
$ 409,713 $ 973,617 $ 1,383,330 $ -
1,463,294 1,914,739 1,544,123 1,833,910
$ 1,873,007 $ 2,888,356 $ 2,927,453 $ 1,833,910
$ 975 $ 1,174,124 $ 1,175,099 $ -
- 3,255. - 3,255
1,872,032 1,710,977 1,752,354 1,830,655
$ 1,873,007 $ 2,888,356 $ 2,927,453 $ 1,833,910
Balance
July 1, 2009 Additions
Deletions
Balance
June 30, 2010
$ 1,998,908 $ 12,991,094 $ 14,990,002 $ -
25,911,204 35,297,507 34,022,660 27,186,051
228,636 134,863 228,635 134,864
$ 28,138,748 $ 48,423,464 $ 49,241,297 $ 27,320,915
$ 3,387 $ 6,590,610 $ 6,555,513 $ 38,484
- 425,660 - 425,660
28,135,361 41,407,194 42,685,784 26,856,771
$ 28,138,748 $ 48,423,464 $ 49,241,297 $ 27,320,915
STATISTICAL SECTION
This page left blank intentionally.
STATISTICAL SECTION
This part of the City of Tustins comprehensive annual financial report presents
detailed information as a context for understanding what the information in the financial
statements, note disclousures, and required supplementaryinformation says about the city's
overall financial health.
Contents
Palle
Financial Trends
These schedules contain trend information to help the reader understand how the 98
city's financial performance and well-being have changed over time.
Revenue Capacity
These schedules contain information to help the reader assess one of the city's 108
most significant local revenue sources, the property tax.
Debt Capacity
These schedules present information to help the reader assess the affordability 114
of the city's current levels of outstanding debt and the city's ability to issue
additional debt in the future.
Demographic and Economic Information
These schedules offer demographic and economic indicators to help the reader 124
understand the environment within which the city's financial activities take place.
Operating Information
These schedules contain service and infrastructure data to help the reader 127
understand how the information in the city's financial report relates to the services
the city provides and the activities it performs.
Sources: Unless otherwise noted, the information in these schedules is derived from the
Comprehensive annual financial reports for the relevent year. The city implemented GASB
Statement 34 in 2005, schedules presenting government -wide information include information
beginning in that year.
CITY OF TUSTIN
Net Assets by Component
Last Six Fiscal Years
(Accrual basis of Accounting)
Total governmental activities net assets $ 300,282,417 $ 331,148,027 $ 359,506,153
Business -type activities:
Invested in capital assets,
net of related debt $ 22,198,864 $ 20,494,561 $ 22,150,723
Restricted _
Unrestricted 207,310,935 206,342,244 199,289,608
Total business -type activities net assets $ 229,509,799 $ 226,836,805 $ 221,440,331
Primary government:
Fiscal Year
Invested in capital assets,
2005
2006
2007
Governmental activities:
$ 260,681,661
$ 281,627,346
$ 307,482,225
Invested in capital assets,
53,511,631
55,021,376
94,111,615
net of related debt
$ 238,482,797
$ 261,132,785
$ 285,331,502
Restricted
53,511,631
55,021,376
94,111,615
Unrestricted
8,287,989
14,993,866
(19,936,964)
Total governmental activities net assets $ 300,282,417 $ 331,148,027 $ 359,506,153
Business -type activities:
Invested in capital assets,
net of related debt $ 22,198,864 $ 20,494,561 $ 22,150,723
Restricted _
Unrestricted 207,310,935 206,342,244 199,289,608
Total business -type activities net assets $ 229,509,799 $ 226,836,805 $ 221,440,331
Primary government:
Invested in capital assets,
net of related debt
$ 260,681,661
$ 281,627,346
$ 307,482,225
Restricted
53,511,631
55,021,376
94,111,615
Unrestricted
215,598,924
221,336,110
179,352,644
Total primary government net assets
$ 529,792,216
$ 557,984,832
$ 580,946,484
OR
Fiscal Year
2008 2009 2010
$ 343,062,465 $ 357,299,104 $ 360,282,692
161,669, 815 145,602,640 135,670,302
(14,320,020) 104,037,153 115,210,222
$ 490,412,260 $ 606,938,897 $ 611,163,216
$ 22,267,386 $ 24,964,824 $ 24,541,113
- 1,191,694 -
172,421,511 1,981,499 1,851,666
$ 194,688,897 $ 28,138,017 $ 26,392,779
$ 365,329,851 $ 382,263,928 $ 384,823,805
161,669,815 146,794,334 135,670,302
158,101,491 106,018,652 117,061,888
$ 685,101,157 $ 635,076,914 $ 637,555,995
CITY OF TUSTIN
Changes in Net Assets
Last Six Fiscal Years
(Accrual basis of Accounting)
Expenses:
Governmental activities
General Government
Public Safety
Public Works
Community Services
Interest on long-term debt
Total governmental activities expense
Business -type activities:
Fiscal Year
2005 2006 2007
$ 9,151,650 $ 10,269,053 $ 7,926,778
21,748,046 23,255,837 25,269,653
14,169,030 14,354,535 19,091,399
3,255,036 3,425,790 3,444,799
8 74, 93 9 1,003,920 1,618,814
$ 49,198,701 $ 52,309,135 $ 57,351,443
Water
$ 9,324,853 $
9,365,401
$ 11,879,958
Tustin Legacy
1,788,633
1,355,822
1,518,560
Total business -type activities expenses
$ 11,113,486 $
10,721,223
$ 13,398,518
Total primary government expenses
$ 60,312,187 $
63,030,358
$ 70,749,961
Program revenues:
Government activities:
Charges for services:
General government
Public Safety
Public Works
Community Services
Operating grants and contributions
Capital grants and contributions
Total governmental activities
program revenues
Business -type activities:
Charges for services:
Water
Tustin Legacy
Operating grants and contributions
Capital grants and contributions
Total business -type activities
program revenues
Net revenues (expenses):
Government activities:
Business -type activities:
Total net revenues (expenses)
$ 1,928,287 $
2,388,279 $
2,540,796
1,180,959
1,364,877
1,476,811
1,631,277
3,230,212
2,987,687
941,297
876,199
916,075
2,377,440
3,655,881
3,677,905
4,484,592
19,470,274
9,652,907
$ 12,543,852 $ 30,985,722 $ 21,252,181
$ 8,478,119 $ 8,858,151 $ 10,418,522
1,328,686 3,660,334 409,693
805,777 - -
$ 10,612,582 $ 12,518,485 $ 10,828,215
$ (36,654,849) $ (21,323,413) $ (36,099,262)
$ (500,904) $ 1,797,262 $ (2,570,303)
$ (37,155,753) $ (19,526,151) $ (38,669,565)
Fiscal Year
2008 2009 2010
$ 8,668,759 $
8,499,303
$ 7,802,579
27,875,230
29,126,019
27,277,141
30,814,898
22,102,002
20,816,686
3,442,833
5,112,770
12,742,391
4,715,026
3,566,782
4,087,839
$ 75,516,746 $ 68,406,876 $ 72,726,636
$ 11,870,706 $ 12,569,331 $ 11,938,146
1,279,802 1,259,093 -
$ 13,150,508 $ 13,828,424 $ 11,938,146
$ 88,667,254 $ 82,235,300 $ 84,664,782
$ 2,716,432 $
1,694,464 $
1,404,925
2,749,660
2,136,772
1,168,348
1,688,753
2,374,308
3,761,321
929,548
897,386
957,545
3,831,037
4,253,442
3,403,411
79,210,370
18,865,776
6,760,404
$ 91,125,800 $ 30,222,148 $ 17,455,954
$ 10,923,061 $ 11,281,679 $ 10,594,471
34,370 22,587 -
28,299,036 - -
$ 39,256,467 $ 11,304,266 $ 10,594,471
$
15,609,054
$
(38,184,728)
$
(55,270,682)
$
26,105,959
$
(2,524,158)
$
(1,343,675)
$
41,715,013
$
(40,708,886)
$
(56,614,357)
CITY OF TUSTIN
Changes in Net Assets
Last Six Fiscal Years
(Accrual basis of Accounting)
General revenues and other changes in net assets:
Governmental activities
Taxes:
Property taxes
Transient occupancy taxes
Business license taxes
Other taxes
Sales Tax
Motor vehicle in lieu, unrestricted
Investment income
Other general revenues
Gain (loss) on disposal of capital assets
Transfers
Total governmental activities
Business -type activities:
Investment income
Gain (loss) on disposal of capital assets
Miscellaneous
Transfers
Total business -type activities
Total primary government
Changes in net assets
Governmental activities
Business -type activities:
Total primary government
Fiscal Year
2005 2006 2007
$ 19,338,392 $ 21,242,797 $ 28,617,969
139,879
155,199
161,105
N/A
N/A
N/A
1,320,209
1,409,696
1,534,720
18,351,207
18,912,722
19,317,135
455,244
433,795
443,222
-
3,202,914
4,842,033
10,846,132
1,323,230
1,598,099
(216,936)
(422,555)
-
1,233,209
5,931,225
7,943,105
$ 51,467,336 $ 52,189,023 $ 64,457,388
$ - $ 1,411,899 $ 1,567,316
8,358,415 - 3,519,618
509,956 49,070 -
(1,233,209) (5,931,225) (7,943,105)
$ 7,635,162 $ (4,470,256) $ (2,856,171)
$ 59,102,498 $ 47,718,767 $ 61,601,217
$ 14,812,487 $ 30,865,610 $ 28,358,126
7,134,258 (2,672,994) (5,426,474)
$ 21,946,745 $ 28,192,616 $ 22,931,652
Fiscal Year
2008 2009 2010
$ 31,070,501 $ 34,022,959 $ 28,347,659
163,831
154,379
141,335
N/A
356,565
337,867
1,665,601
1,689,573
1,720,505
20,428,465
19,858,142
15,917,332
321,918
252,666
6,122,789
7,417,199
4,863,469
4,086,852
1,523,530
2,314,540
1,520,662
(1,366,208)
-
-
53,668,609
103,805,196
-
$ 114,893,446 $ 167,317,489 $ 58,195,001
$ 815,560 $ 164,764 $ 86,654
(681) - -
23,337 82,810 25,340
(53,668,609) (103,805,196) -
$ (52,830,393) $ (103,557,622) $ 111,994
$ 62,063,053 $ 63,759,867 $ 58,306,995
$ 130,502,500 $ 129,132,761 $ 2,924,319
(26,721,434) (106,081,780) (1,231,681)
$ 103,781,066 $ 23,050,981 $ 1,692,638
CITY OF TUSTIN
Fund Balances of Governmental Funds
Last Six Fiscal Years
(Modified accrual basis of Accounting)
General Fund:
Reserved
Unreserved
Total General Fund
All other Governmental Funds:
Reserved
Unreserved, reported in:
Special Revenue Funds
Debt Services Funds
Capital Projects Funds
Total All other Governmental Funds
Fiscal Year
2005 2006 2007
$ 276,989 $ 118,510 $ 248,372
19,931,022 24,124,968 20,454,356
$ 20,208,011 $ 24,243,478 $ 20,702,728
$ 32,804,461 $ 34,612,789 $ 68,724,358
7,592,615 8,550,855 10,639,839
1,936,057 2,510,686 -
17,029,831 11,145,244 12,388,651
$ 59,362,964 $ 56,819,574 $ 91,752,848
Ina
Fiscal Year
2008 2009 2010
$ 116,342 $ 120,632,293 $ 144,139,167
24,471,029 1,971,846 5,870,992
$ 24,587,371 $ 122,604,139 $ 150,010,159
$ 76,696,588 $ 49,777,973 $ 66,609,267
64, 896,223 16,437,130 14,277,683
- - (6,774,245)
17,558,428 90,474,987 76,136,259
$ 159,151,239 $ 156,690,090 $ 150,248,964
1ns
e
CITY OF TUSTIN
Changes of Fund Balances of Governmental Funds
Last Six Fiscal Years
(Modified accrual basis of Accounting)
Revenues:
Taxes
Licenses and Permits
Fines and Forfitures
Use of Money and Property
Intergovernmental Revenues
Charges for Services
Rental Income
Developer contributions
Other Revenue
Total Revenues
Expenditures:
Current:
General Government
Public Safety
Public Works
Community Services
Capital Outlay
Debt Service:
Principal Retirement
Interest and Fiscal Charges
Total Expenditures
Excess (deficiency) of Revenues
over (under) Expenditures
Other Financing Sources (uses):
Proceeds from debt issuance
Transfers in
Transfers out
Contribution to developer
Sale of Property
Total other Financing Sources (uses)
Net Change in Fund Balances
Debt Service as a Percentage of
Noncapital Expenditures
Fiscal Year
2005 2006 2007
$ 39,290,491 $ 40,542,668 $ 48,306,569
1,008,965
2,153,355
2,095,154
895,816
784,966
783,390
1,662,329
2,849,921
4,228,582
7,613,141
15,338,254
20,136,822
1,530,537
2,107,336
2,043,251
208,222
304,733
349,450
12,827,879
8,260,032
3,160,370
$ 65,037,380 $
72,341,265 $
81,103,588
$ 8,429,464 $
10,134,368 $
7,806,916
21,075,766
22,697,122
24,450,803
7,475,332
7,691,894
9,651,745
2,834,472
3,026,890
3,023,648
13,509,215
27,057,889
28,503,673
1,220,000 1,275,000 1,330,000
884,533 1,023,622 1,620, 897
$ 55,428,782 $ 72,906,785 $ 76,387,682
$ 9,608,598 $
5,203,652
(3,970,443)
(565,520) $ 4,715,906
- $ 25,000,000
7,190,511 10,795,694
(5,270,356) (10,795,694)
65,431 137,442 1,676,618
$ 1,298,640 $ 2,057,597 $ 26,676,618
$ 10,907,238 $ 1,492,077 $ 31,392,524
5.29% 5.28% 6.57%
Fiscal Year
2008 2009 2010
$ 51,775,505 $
56,198,002 $
52,579,529
2,710,309
1,692,955
3,538,198
818,868
832,188
890,770
7,529,488
4,429,915
3,198,484
27,394,402
14,626,663
5,851,603
1,583,324
4,497,309
2,708,705
786,438
771,807
869,645
-
-
4,051,180
59,309,772
1,188,200
1,028,433
$ 151,908,106 $
84,237,039 $
74,716,547
$ 8,295,887 $
6,728,236 $
7,197,709
26,561,960
27,759,939
26,359,435
10,136,680
11,311,291
10,133,685
2,886,132
5,005,986
12,251,479
15,080,865
24,772,717
13,125,983
1,055,000 11,143,000 7,913,000
4,718,806 3,570,834 4,603,661
$ 68,735,330 $ 90,292,003 $ 81,584,952
$ 83,172,776 $ (6,054,964) $ (6,868,405)
$ - $ - $ 26,274,205
7,803,274 142,866,218 37,207,661
(7,803,274) (41,295,836) (37,207,661)
(11,934,400) - -
44,658 40,201 7,421
$ (11,889,742) $ 101,610,583 $ 26,281,626
$ 71,283,034 $ 95,555,619 $ 19,413,221
12.06% 28.96% 16.50%
CITY OF TUSTIN
Assessed Value and Estimated Actual Value of Taxable Property
Last Ten Fiscal Years
(In thousands of dollars)
City
Fiscal Year Taxable
Ended Assessed
June 30 Secured Unsecured Value
2001
$ 4,071,186 $
420,731 $
4,491,917
2002
4,360,086
385,783
4,745,869
2003
4,637,831
301,761
4,939,592
2004
4,969,203
314,645
5,283,848
2005
5,306,887
308,339
5,615,226
2006
5,753,518
285,670
6,039,188
2007
6,397,216
301,747
6,698,963
2008
7,109,465
359,631
7,469,096
2009
7,505,735
435,026
7,940,761
2010
7,381,782
371,722
7,753,504
Notes: .
Exemptions are netted directly against individual categories.
In 1978 the voters of the State of California passed proposition 13 which limited property taxes
to a total maximum rate of I% based upon the assessed value of the property being taxed.
Each year, the assessed value of property may be increased by an "inflation factor" (limited to a
maxumum increase of 2%). With few exceptions, property is only reassessed at the time that it
is sold. At that point, the new assessed value is set at the purchase price of the property. The
assessed valuation data shown above represents the only data currently available with respect
to the actual market value of taxable property and is subject to the limitations described above.
MR
inn
Redevelopment Agency
Taxable
Total
Assessed
Direct
Secured
Unsecured
Value
Tax Rate
$ 564,660
$ 66,749 $
631,409
0.190%
598,180
99,367
697,547
0.195%
621,304
67,143
688,447
0.191%
659,266
61,810
721,076
0.190%
927,400
68,767
996,167
0.220%
1,039,506
71,738
1,111,244
0.226%
1,496,217
84,203
1,580,420
0.261%
2,425,555
165,392
2,590,947
0.279%
1,946,378
71,422
2,017,800
0.326%
1,667,398
80,166
1,747,564
0.308%
inn
CITY OF TUSTIN
Direct and Overlapping Property Tax Rates
Last Six Fiscal Years
Source: Hdl, Coren & Cone
IM
2005
2006
2007
Direct Rate:
City of Tustin
$ 0.1272
$
0.1272
$ 0.1272
Tustin Unified School District
0.4397
0.4397
0.4397
South Orange County Community
College District
0.0886
0.0886
0.0886
County of Orange
0.0617
0.0617
0.0617
Orange County Flood
Control District
0.0198
0.0198
0.0198
Orange County Library District
0.0167
0.0167
0.0167
Orange County Department
of Education
0.0161
0.0161
0.0161
Various Special Districts
0.2302
0.2302
0.2302
Total Basic Rate
$ 1.0000
$
1.0000
$ 1.0000
Over Lapping Rates:
Tustin Unified School Dist. Bonds
$ 0.0554
$
0.0311
$ 0.0023
Metropoliton Water District Bonds
0.0058
0.0052
0.0047
Rancho Santiago Community
College District Bonds
0.0273
0.0169
0.0191
Irvine Ranch Water District Bonds
0.0001
0.0477
0.2138
Santa Ana Unified School Dist. Bonds
0.0496
0.0435
0.0392
Total Overlapping Rates
$ 0.1381
$
0.1444
$ 0.2791
Total Direct and Overlapping Rates
$ 1.1381
$
1.1444
$ 1.2791
Source: Hdl, Coren & Cone
IM
2008
2009
2010
$
0.1272
$ 0.1272
$
0.1272
0.4397
0.4397
0.4397
0.0886
0.0886
0.0886
0.0617
0.0617
0.0617
0.0198
0.0198
0.0198
0.0167
0.0167
0.0167
0.0161
0.0161
0.0161
0.2302
0.2302
0.2302
$
1.0000
$ 1.0000
$
1.0000
$
0.0317
$ 0.0310
$
0.0380
0.0045
0.0043
0.0043
0.0237
0.0225
0.0274
0.2143
0.2143
0.2242
0.0359
0.0321
0.0739
$
0.3101
$ 0.3043
$
0.3677
$
1.3101
$ 1.3043
$
1.3677
CITY OF TUSTIN
Principal Property Tax Payers
Current Year and Nine Years Ago
2010 2001
Percent of
Percent of
Total City
Total City
Taxable Taxable Taxable
Taxable
Assessed Assessed Assessed
Assessed
Taxpayer Value Value Value
Value
Irvine Company LLC
Vestar Kimco Tustin LP
Creekside Meadows Development LLC
Tustin Legacy Community Partners
Irvine Apartment Communities LP
American Funding US Investments LP
Borchard Redhill SKB-Tustin LLC
PK H Larwin Square SC LP
Tustin Heights SC LP
Costco Wholesale
Irvine Apartment
Steelcase Inc
Ricoh Electronics Inc
Sanyo Foods Corporation
AIMCO Brookside Tustin
Pairgain Technologies Inc
Texas Instruments Inc
Catellus Finance
$ 217,805,520
2.29% $ 61,524,008 1.23%
$ 150,656,486
1.59%
$ 130,368,443
1.37%
$ 86,699,995
0.91%
$ 84,078,200
0.89% $ 34,245,134 0.68%
$ 57,888,895
0.61%
$ 55,368,358
0.58%
$ 50,121,773
0.53%
$ 47,130,120
0.50%
$ 46,636,264
0.49%
$ 196,061,717 3.91%
$ 72,972,935
1.45%
$ 39,329,286
0.78%
$ 38,592,251
0.77%
$ 35,454,092
0.71%
$ 34,327,869
0.68%
$ 30,474,948
0.61%
$ 25,772,764
0.51%
$ 926,754,054 9.76% $ 568,755,004 11.33%
The amounts shown above include the Combined Tax Rolls & the SBE Non -Unitary Tax Roll
Sources:
Orange County Assessor's Office
HdL, Coren & Cone
CITY OF TUSTIN
Property Tax Levies and Collections
Last Seven Fiscal Years
Collected Within the
Fiscal Taxes Levied Fiscal Year of Levy Collections in Total Collections to Date
Year Ended for the Percent Subsequent Percent
June 30 Fiscal Year Amount of Levy Years Amount of Levy
2004
$ 12,011,332
$ 11,507,171
95.80%
$ 27,851
$ 11,535,022
96.03%
2005
19,706,674
19,338,392
98.13%
42,299
19,380,691
98.35%
2006
21,602,011
21,242,797
98.34%
309,074
21,551,871
99.77%
2007
30,701,393
28,617,969
93.21%
695,793
29,313,762
95.48%
2008
33,554,781
31,070,501
92.60%
325,973
31,396,474
93.57%
2009
38,515,110
34,022,959
88.34%
1,417,067
35,440,026
92.02%
2010
31,739,378
28,347,659
89.31%
917,222
29,264,881
92.20%
Note:
The amounts presented include City property taxes and Redevelopment Agency tax increment.
This schedule also includes amounts collected by the City and Revelopment Agency that were
passed -through to other agencies.
Source: County of Orange Auditor Controller's Office.
CITY OF TUSTIN
Ratios of Outstanding Debt by Type
Last Ten Fiscal Years
Governmental Activities
Fiscal Year
General
Tax
Tax
Lease
Total
Ended
Obligation
Allocation
Allocation
Revenue
Notes Notes Governmental
June 30
Bonds
Bonds (1)
Bonds (7)
Bonds (2)
Payable (3) Payable (4) Activities
2001 $
- $ 18,475,000
$ - $ 1,760,000
$ -
$ - $ 20,235,000
2002
- 17,650,000
- 1,500,000
-
- 19,150,000
2003
- 16,800,000
- 1,230,000
-
- 18,030,000
2004
- 15,910,000
- 945,000
-
- 16,855,000
2005
- 14,990,000
- 645,000
-
- 15,635,000
2006
- 14,030,000
- 330,000
-
- 14,360,000
2007
- 13,020,000
- -
25,000,000
- 38,020,000
2008
- 11,975,000
- -
25,000,000
- 36,975,000
2009
- 10,870,000
- -
14,962,000
19,284,170 45,116,170
2010
- 9,720,000
26,170,000 -
8,199,000
20,112,456 64,201,456
Notes: Details regarding the City's outstanding debt can be found in the notes to the
financial staements.
Per Capita Personal Income is not available for the City of Tustin alone so the
Percentage of Personal Per Capita Income has been left off this schedule.
On July 1, 1998 the City issued $20.8 million of Tax Allocation Refunding Bonds to retire Series 1987 Refunding
(1) Bonds.
2 In June of 1996 the City issued $2.7 million of Lease Revenue Bonds as a member of the Countywide Joint Powers
O Authority. The final maturity was August, 2006.
3 In April of 2007 the Tustin Redevelopment Agency executed a note payable in the amount of $25 million to aquire
O property to carry out the program objectives of the Agency.
In December of 2008 the City executed a note payable to the Tustin Redevelopment Agency in the amount of
(4) $18,881,750 to increase its deposit of probable compensation per court order pending litigation. The balance also
includes accrued interest in the amount of $1,162,188.
(5) In September of 2003 the City issued $14.355 million of Refunding Water Revenue Bonds to defease the
outstanding Certificates of Participation and the Orange County Water District Notes.
(6) In 1998 the City executed a note payable in the amount of $6.8 million with the Orange County Water District.
(7) In March 2010 the Tustin Redevelopment Agency issued $26,170,000 Tax Allocation Housing Bonds, Series 2010
to refinance low and moderate income housing activities throughout the geographic boundaries in the City.
115
Business -type Activities
Water
Total
Total
Debt
Revenue
Certificates of
Notes Business
-type
Primary
Per
Bonds (5)
Participation
Payable (6)
Activities
Government
Capita
$ -
$ 9,050,000
$ 5,840,476 $
14,890,476
$ 36,170,476
$ 529
-
8,600,000
5,248,472
13,848,472
34,083,472
493
-
8,100,000
4,632,456
12,732,456
31,882,456
462
-
7,575,000
3,991,272
11,566,272
29,596,272
424
13,668,367
-
-
13,668,367
30,523,367
434
13,461,607
-
-
13,461,607
29,096,607
411
13,331,607
-
-
13,331,607
27,691,607
386
13,080,000
-
-
13,080,000
51,435,000
709
12,560,000
-
-
12,560,000
57,676,170
782
11,875,000
-
-
11,875,000
76,076,456
1,004
115
CITY OF TUSTIN
Ratio of General Bonded Debt Outstanding
Last Ten Fiscal Years
Outstanding General Bonded Debt
Fiscal Year General Tax Percent of
Ended Obligation Allocation Assessed Per
June 30 Bonds Bonds Total Value* Capita
2001 $
- $ 18,475,000
$ 18,475,000
0.36%
$ 267
2002
- 17,650,000
17,650,000
0.32%
256
2003
- 16,800,000
16,800,000
0.30%
241
2004
- 15,910,000
15,910,000
0.26%
226
2005
- 14,990,000
14,990,000
0.23%
212
2006
- 14,030,000
14,030,000
0.20%
195
2007
- 13,020,000
13,020,000
0.16%
179
2008
- 11,975,000
11,975,000
0.12%
166
2009
- 10,870,000
10,870,000
0.11%
147
2010
- 9,720,000
9,720,000
0.10%
128
General bonded debt is debt payable with governmental fund resources and general
obligation bonds recorded in enterprise funds. The City currently does not have
general bonded debt in either fund.
* Assessed value has been used because the actual value of taxable property is not
readily available in the State of California.
IIA
CITY OF TUSTIN
Overlapping Debt Schedule
As of 6/30/2010
2009-10 Assessed Valuation: $ 9,501,068,800
$ 391,027,000
1.99%
$
Redevelopment Incremental Value: 2,131,087,199
Orange County Pension Obligations
59,333,382
1.986
Adjusted Assessd Value $ 7,369,981,601
1,178,361
Orange County Board of Education Certificates of Participation
19,230,000
1.986
Total Debt
(1)
City's Share of
OVERLAPPING TAX AND ASSESSMENT DEBT:
6/30/2010
% Applicable
Debt @ 6/30/2010
Metropolitan Water District
$ 51,185,529
1.97%
$ 1,006,192
Rancho Santiago Community College District
313,655,747
0.066
207,141
Santa Ana Unified School District
274,053,366
0.12
327,559
Tustin Unified School District School Facilities Improvement District No. 2002-1
87,705,295
46.348 - 47.222
40,979,277
City of Tustin Community Facilities Districts
77,770,000
100
77,770,000
City of Tustin 1915 Act Bonds
43,135,000
100
43,135,000
Irvine Ranch Water District Improvement Districts
271,735,172
2.795 - 85.232
92,214,953
TOTAL OVERLAPPING TAX AND ASSESSMENT DEBT
6,184,933
Orange County Fire Authority
$ 255,640,122
DIRECT AND OVERLAPPING GENERAL FUND DEBT:
Orange County General Fund Obligations
$ 391,027,000
1.99%
$
7,765,796
Orange County Pension Obligations
59,333,382
1.986
1,178,361
Orange County Board of Education Certificates of Participation
19,230,000
1.986
381,908
Municipal Water District of Orange County Water Facilities Corporation
15,965,000
2.356
376,135
South Orange County Community College District Certificates of Participation
18,845,000
4.606
868,001
Orange Unified School District Certificates of Participation
142,660,000
0.034
48,504
Santa Ana Unified School District Certificates of Participation
53,953,747
0.001
540
Tustin Unified School District Certificates of Participation
5,390,000
43.148
2,325,677
City of Tustin
27,483,170
100
27,483,170
Irvine Ranch Water District Certificates of Participation
85,145,000
7.264
6,184,933
Orange County Fire Authority
3,590,000
3.862
138,646
TOTAL GROSS DIRECT AND OVERLAPPING GENERAL FUND DEBT:
46,751,671
Less: MWDOC Water Facilities Corporation (100% self supporting)
416,659
Santa Ana Unified School District QZABs Supported by investment fund
115
TOTAL NET DIRECT AND OVERLAPPING GENERAL FUND DEBT:
$
46,334,897
GROSS COMBINED TOTAL DEBT
$
302,391,793 (2)
NET COMBINED TOTAL DEBT
$
301,975,019
(1) Percentage of overlapping agency's assessed valuation located within boundaries of the city.
(2) Excludes tax and revenue anticipation notes, enterprise revenue, rmrtgage revenue and tax allocation bonds and
non -bonded capital lease obligations.
Ratios to 2009-10 Assessed Valuations:
Total Overlapping Tax and Assessment Debt 3.47%
Ratios to Adiusted Assessed Valuations:
Combined Direct Debt 0.37%
Gross Combined Total Debt 4.10%
Net Combined Total Debt 4.10%
Source: HdL Coren & Cone
Illy
Assessed Valuation
Conversion Percentage
Adjusted Assessed Valuatiuon
Debt Limit Percentage
Debt Limit
Total net debt applicable to limit
General Obligation Bonds
Legal Debt Margin
Total Debt applicable to the limit
as a percentage of debt limit
CITY OF TUSTIN
Legal Debt Margin Information
Last Ten Fiscal Years
Fiscal Year
2001 2002 2003
$ 4,491,917,000 $ 4,745,869,000 $ 4,939,592,000
25% 25% 25%
1,122,979,250
15%
168,446,888
1,186,467,250 1,234,898,000
15%
177,970,088
15%
185,234,700
$ 168,446,888 $ 177,970,088 $ 185,234,700
The Government Code of the State of California provides for a legal debt limit of 15% of gross
assessed valuation. However, this provision was enacted when assessed valuation was based on 25%
of market value. Effective with the 1981-82 fiscal year, each parcel is now assessed at 100% of
market value (as of the most recent change in ownership for that parcel). The computations shown
above reflect a conversion of assessed valuation data for each fiscal year from the current full
valuation perspective to the 25% level that was in effect at the time that the legal debt margin was
enacted by the State.
Source: County Tax Assessor's Office
City Finance Department
11R
Fiscal Year
2004 2005
$ 5,283,848,000 $ 5,615,226,000
25% 25%
1,320,962,000 1,403,806,500
15% 15%
198,144,300 210,570,975
$ 198,144,300 $ 210,570,975
CITY OF TUSTIN
Legal Debt Margin Information
Last Ten Fiscal Years
I)A
Fiscal Year
2006
2007
2008
Assessed Valuation
$ 6,039,188,000
$ 6,698,963,000
$ 7,469,096,000
Conversion Percentage
25%
25%
25%
Adjusted Assessed Valuatiuon
1,509,797,000
1,674,740,750
1,867,274,000
Debt Limit Percentage
15%
15%
15%
Debt Limit
226,469,550
251,211,113
280,091,100
Total net debt applicable to limit
General Obligation Bonds
-
Legal Debt Margin
226,469,550
251,211,113
280,091,100
Total Debt applicable to the limit
as a percentage of debt limit
-
_
_
I)A
Fiscal Year
2009 2010
$ 7,940,761,000 $ 7,753,504,000
25% 25%
1,985,190,250 1,938,376,000
15% 15%
297,778,538 290,756,400
297,778,538 290,756,400
III
CITY OF TUSTIN
Pledged -Revenue Coverage
Last Ten Fiscal Years
Note: Details regarding the city's outstanding debt can be found in the notes to the
financial statements. Operating expenses do not include interest or depreciation
expenses. Water revenues in 2010 include proceeds from an advance from the
City's general fund.
IT)
Refunding Water Revenue Bonds
Fiscal Year
Less
Net
Ended
Water
Operating
Available
Debt Service
June 30
Revenue
Expenses
Revenue
Principal
Interest
Coverage
2001
$ 10,197,034
$ 5,082,119
$ 5,114,915
$ 450,000
$ 496,850
5.40
2002
9,789,933
6,208,470
3,581,463
500,000
459,950
3.73
2003
8,718,072
6,019,880
2,698,192
525,000
421,200
2.85
2004
9,189,579
6,032,117
3,157,462
400,000
311,002
4.44
2005
8,905,221
7,297,101
1,608,120
230,000
583,920
1.98
2006
9,348,715
7,417,023
1,931,692
130,000
575,410
2.74
2007
10,844,515
9,986,251
858,264
180,000
570,470
1.14
2008
11,240,752
10,053,706
1,187,046
335,000
563,450
1.32
2009
11,510,315
10,573,932
936,383
520,000
550,385
0.87
2010
12,829,902
9,928,608
2,901,294
685,000
530,105
2.39
Note: Details regarding the city's outstanding debt can be found in the notes to the
financial statements. Operating expenses do not include interest or depreciation
expenses. Water revenues in 2010 include proceeds from an advance from the
City's general fund.
IT)
Tax Allocation Bonds
Tax
Allocation
Debt Service
Principal Interest
Coverage
$ 2,193,408
$ 795,000
$ 864,929
1.32
2,359,830
825,000
833,537
1.42
2,295,614
850,000
800,450
1.39
2,362,640
890,000
765,205
1.43
2,401,247
920,000
727,640
1.46
2,952,481
960,000
687,680
1.79
3,956,734
1,000,000
642,040
2.41
3,381,188
1,055,000
594,358
2.05
4,460,947
1,105,000
547,365
2.70
3,831,975
1,150,000
497,180
2.33
in
CITY OF TUSTIN
Demographic and Economic Statistics
Last Ten Calendar Years
2001
County of
County of
$ 37,674
4.00%
Orange
Orange
County of
City of
Personal
Per Capita
Orange
Tustin
Income
Personal
Unemployment
Calendar Population
In Millions
Income
Rate
Year (1)
(2)
(2)
(3)
2001
69,199
$ 109,010
$ 37,674
4.00%
2002
69,078
111,750
38,247
5.00%
2003
69,745
117,722
39,944
4.80%
2004
70,339
125,798
42,420
4.30%
2005
71,767
135,071
45,488
3.80%
2006
72,542
150,598
50,997
3.40%
2007
72,348
153,839
52,009
3.90%
2008
73,743
155,118
51,894
5.30%
2009
74,736
Not Available
Not Available
9.00%
2010
75,773
Not Available
Not Available
Not Available
Sources: (1) California Department of Finance
(2) U.S. Department of Commerce - Bureau of Economic Analysis
(Data shown is for the Orange County - There is a 2 -year lag)
(3) State Department of Employment Development Dept.
(Data shown is for the Orange County -There is a 1 -year lag)
i)a
CITY OF TUSTIN
Principal Employers
Last Calendar Year
Sources: HdL Coren & Cone
www.InfoUSA.com
2009
Percent of
Number of
Total
Employer
Employees
Employment
ABM Industries
1,300
3.53%
Tustin Unified School District
1,004
2.73%
Rockwell Collins Filter Products
600
1.63%
Big Lots
500
1.36%
Ricoh Electronics
500
1.36%
Cherokee International
350
0.95%
City of Tustin
307
0.83%
Microvention Inc
300
0.82%
Toshiba America Medical Systems
300
0.82%
Warner Systems Inc
280
0.76%
RAJ Manufacturing Inc
260
0.71%
Balboa Water Group
253
0.69%
Costco
250
0.68%
Kleen Impressions
250
0.68%
Tustin Hospital
245
0.67%
Southern California Pipeline
235
0.64%
Home Depot
203
0.55%
HealthSouth
200
0.54%
Logomark Inc
200
0.54%
Red Robin Gourmet Burgers
200
0.54%
Sources: HdL Coren & Cone
www.InfoUSA.com
CITY OF TUSTIN
Full-time City Employees
by Function
Last Ten Fiscal Years
Total 275 283 288 288 284 286 296 295 297 294
The City contracts with the OC Fire Authority for fire services.
Source: City of Tustin Finance Dept.
Full Time
Employees as of June 30
Function
2001
2002
2003
2004
2005
2006
2007
2008
2009
2010
General Government
29
32
32
32
31
31
31
31
27
27
Community Development
24
24
21
21
22
24
28
29
28
24
Public Works
47
48
47
47
48
48
50
51
50
53
Police
136
139
141
141
141
141
145
144
147
147
Parks and Recreation
16
16
20
20
18
17
17
15
16
15
Redevelopment Agency
3
3
5
5
2
3
5
5
6
6
Water
20
21
22
22
22
22
20
20
23
22
Total 275 283 288 288 284 286 296 295 297 294
The City contracts with the OC Fire Authority for fire services.
Source: City of Tustin Finance Dept.
CITY OF TUSTIN
Capital Asset Statistics
by Function
Last Ten Fiscal Years
Function
2001
2002
2003
2004
2005
2006
2007
2008
2009
I Services
13,500
13,500
13,500
13,500
13,500
13,900
14,080
Public Safety:
14,118
e daily consumption ccf
12,500
12,500
12,500
12,500
12,500
12,514
17,205
nations
1
1
1
1
1
1
1
1
1
itions (1)
2
2
2
2
2
2
2
2
2
Public Works:
13
vlain miles
173
173
173
173
173
173
173
piles
101.8
101.8
101.8
101.8
101.8
101.8
101.8
106.3
127.2 1
fights
2,855
2,855
2,855
2,855
2,855
2,855
2,855
3,285
3,544
Signls
96
97
97
97
97
97
97
113
113
)rain miles
23.7
23.7
23.7
23.7
23.7
23.7
23.7
49.1
49.2
'rees
16,755
16,559
16,689
16,667
16,744
16,638
16,638
15,821
15,853
arks and Recreation:
kcres
12/81.5
12/81.5
12/81.5
12/81.5
12/81.5
12/81.5
12/81.5
12/81.5
12/81.5 L
miry Centers
1
1
1
1
1
1
1
1
1
Centers
1
1
1
1
1
1
1
1
1
Water:
I Services
13,500
13,500
13,500
13,500
13,500
13,900
14,080
14,117
14,118
e daily consumption ccf
12,500
12,500
12,500
12,500
12,500
12,514
17,205
14,970
14,460
)irs
6
6
6
6
6
6
6
6
6
12
12
12
12
12
12
12
12
13
vlain miles
173
173
173
173
173
173
173
173
173
,drants
2200
2200
2200
2200
2200
2200
2,200
2,200
2,201
City contracts with the OC Fire Authority for fire services, and they have full use of City owned stations.
City of Tustin Finance Dept.
CITY OF TUSTIN
Water Consumption by Customer Type
Last Eight Fiscal Years
Type of Customer 2003
Residential
Apartments/Multiple Units
Commercial
Fire Services
Irrigation
Government
Restaurants
Hospitals
Non -Profit
Industrial
Hotels/Motels
All Others
Measured in hundred cubic feet.
Source: City of Tustin Finance Dept.
$ 2,259,295
958,049
270,860
557
118,393
133,120
48,046
15,756
33,287
64,675
10,705
80,312
Fiscal Year
2004 2005 2006
$ 2,522,125
1,042,914
288,347
598
129,127
180,387
59,591
18,333
35,386
57,214
9,806
96,678
$ 2,539,105
1,101,639
285,628
1,100
132,442
170,830
61,706
13,732
37,906
60,262
8,502
112,043
3,993,055 4,440,506 4,524,895
$2,847,140
1,218,770
331,990
306
137,651
179,426
71,356
14,690
43,427
77,425
10,878
103,570
5,036,629
Fiscal Year
2007 2008 2009 2010
$ 3,319,069 $ 3,202,982 $ 3,012,575 $ 2,749,415
1,312,731
1,264,584
1,226,181
1,142,749
360,170
326,987
305,601
287,951
11,453
478
184
217
171,200
174,858
171,382
145,287
265,158
260,688
264,425
238,914
67,378
61,029
54,916
52,761
14,243
14,376
11,222
9,636
48,320
48,922
45,387
43,985
71,065
69,920
67,985
56,360
13,367
12,803
12,890
13,562
100,604
115,246
105,221
171,781
5,754,758 5,552,873 5,277,969 4,912,618
CITY OF TUSTIN
Water Rates
Last Ten Fiscal Years
2001
Consumption Charges
Fiscal Bi -Monthly Up to
From From All
Year Ended Fixed 12
13 to 40 41 to 60 Over 60
June 30 Charge HCF
HCF HCF HCF
2001
$ 16.00
$ 0.35 $
1.12 $
1.20 $
1.32
2002
16.00
0.35
1.12
1.20
1.32
2003
16.00
0.35
1.12
1.20
1.32
2004
16.00
0.35
1.12
1.20
1.32
2005
16.00
0.35
1.12
1.20
1.32
2006
18.16
0.40
1.27
1.36
1.50
2007
20.24
0.44
1.42
1.52
1.67
2008
22.26
0.49
1.56
1.67
1.84
2009
22.26
0.49
1.56
1.67
1.84
2010
22.26
0.49
1.56
1.67
1.84
Notes:
HCF = Hundred Cubic Feet (1HCF = 748 Gallons)
The bi-monthly fixed rate show is based on the standard residential customer meter (5/811).
The City uses the American Water Works Association equivalent meter capacity ratios
from the AWWA Manual M6 to calculate fixed charges for meters ranging from 1 to 6
inches.
Source: City of Tustin Finance Dept.
izn
CITY OF TUSTIN
Water Customers
Current Year
Water Customer
2010
Percent of
Water Total Water
Charges Revenues
TUSTIN UNIFIED SCHOOL DIST
$
380,441.59
3.59%
CITY OF TUSTIN
$
129,089.79
1.22%
SP/PCREEKSIDE VENTURE LLC
$
109,015.38
1.03%
TUSTIN ACRES COMM ASSOC
$
54,958.01
0.52%
AT& T SERVICES, INC.
$
51,711.44
0.49%
V KAY - NNC VALENCIA GARDENS A
$
46,115.59
0.44%
CALTRANS - DISTRICT 12
$
46,017.39
0.43%
SCHROEDER PROP MGMT
$
45,008.94
0.42%
RICOH ELECTRONICS INC
$
43,618.22
0.41%
BRIARWOOD INVESTMENT CO LT
$
43,208.59
0.41%
CARMEL PARTNERS MS#3
$
39,869.77
0.38%
CMC ASSOCIATION MGMT
$
38,374.02
0.36%
CADIGAN COMMUNITIES - MONTEREY PINES
$
37,964.83
0.36%
WESTCHESTER PARK L.P
$
37,052.62
0.35%
VILLA VALENCIA MHP
$
35,942.76
0.34%
SIERRA CORP MGT
$
35,218.98
0.33%
SADDLEBACK MOBILODGE
$
34,439.76
0.33%
ROY E DALY & CO
$
34,198.19
0.32%
REGENCY WEST
$
33,347.60
0.31%
15701 TV WAY PARTNERSHIP
$
32,822.42
0.31%
TUSTIN VILLAGE PROPERTIES
$
31,846.08
0.30%
WATERSTONE GARDENS INVESTMENTS LP
$
30,370.75
0.29%
SKB-TUSTIN LLC
$
30,288.62
0.29%
ALDERS APARTMENT COMPANY
$
29,966.97
0.28%
TUSTIN VILLAGE COM.ASSN
$
29,936.16
0.28%
Total Water Sales $ 1,460,824 13.79%
Source: City of Tustin Finance Dept.
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