2012 CAFRIlie Village of
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COMPREHENSIVE
ANNUAL FINANCIAL REPORT
Fiscal Year Ended September 30, 2012
The Village of
North Palm Beach, Florida
COMPREHENSIVE ANNUAL FINANCIAL REPORT
Fiscal Year Ended September 30, 2012
Prepared by:
Finance Department
Samia Janina
Director of Finance
THE VILLAGE OF NORTH PALM BEACH, FLORIDA
FINANCIAL STATEMENTS
SEPTEMBER 30, 2012
TABLE OF CONTENTS
INTRODUCTORY SECTION
Letterof Transmittal ................................................... ...............................
Principal Village Officials .......................................... ...............................
OrganizationalStructure ............................................. ...............................
GFOA Certificate of Achievement for Excellence in Financial Reporting
FINANCIAL SECTION
Independent Auditors' Report ...............
Management's Discussion and Analysis
BASIC FINANCIAL STATEMENTS:
Government -wide Financial Statements:
Statementof Net Assets ................................................... ...............................
Statement of Activities ..................................................... ...............................
Fund Financial Statements:
Balance Sheet - Governmental Funds .............................. ...............................
Reconciliation of the Balance Sheet — Governmental Funds
to the Statement of Net Assets ................................... ...............................
Statement of Revenues, Expenditures and Changes in
Fund Balances - Governmental Funds ....................... ...............................
Reconciliation of the Statement of Revenues, Expenditures, and Changes in
Fund Balances of the Governmental Funds to the Statement of Activities
Statement of Net Assets - Proprietary Fund ..................... ...............................
Statement of Revenues, Expenses, and Changes in Net
Assets- Proprietary Fund ........................................... ...............................
Statement of Cash Flows - Proprietary Fund ................... ...............................
Statement of Fiduciary Net Assets - Fiduciary Funds ...... ...............................
Statement of Changes in Fiduciary Net Assets — Fiduciary Funds .................
Notes to the Basic Financial Statements ................................. ...............................
REQUIRED SUPPLEMENTARY INFORMATION:
Schedule of Funding Progress- Other Post Employment Benefits ....................
Schedule of Funding Progress — Retirement Funds ........... ...............................
Schedule of Employer and State Contributions ................ ...............................
Notesto the Trend Data .................................................... ...............................
Schedule of Revenues, Expenditures, and Changes in Fund Balance -
Budget and Actual - General Fund .............................. ...............................
Notes to the Budgetary Required Supplementary Information ........................
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THE VILLAGE OF NORTH PALM BEACH, FLORIDA
FINANCIAL STATEMENTS
SEPTEMBER 30, 2012
TABLE OF CONTENTS
(Continued)
OTHER SUPPLEMENTARY INFORMATION:
Schedule of Departmental Expenditures— Budget and Actual — General Fund ..................
Combining Balance Sheet — Nonmaj or Governmental Funds ............. ...............................
Combining Statement of Revenues, Expenditures, and Changes in Fund Balances -
Nonmajor Governmental Funds ....................................................... ...............................
Combining Statement of Net Assets - Fiduciary Funds ...................... ...............................
Combining Statement of Changes in Fiduciary Net Assets - Employee Retirement Funds
Combining Statement of Agency Net Assets ...................................... ...............................
Combining Schedule of Changes in Agency Net Assets and Liabilities .............................
Schedule of Revenues and Departmental Expenses —
Budget and Actual — Country Club Fund — Budgetary Basis ........... ...............................
STATISTICAL SECTION
NetAssets by Component ......................................... ...............................
Changesin Net Assets ............................................... ...............................
Fund Balances, Governmental Funds ........................ ...............................
Changes in Fund Balances, Governmental Funds ..... ...............................
Net Assessed Value and Estimated Actual Value of Taxable Property ...
Property Tax Rates - Direct and Overlapping Governments .....................
Principal Property Taxpayers .................................... ...............................
Property Tax Levies and Collections ........................ ...............................
Ratios of Outstanding Debt by Type .......................... ...............................
Direct and Overlapping Governmental Activities Debt ............................
Pledged- Revenue Coverage ....................................... ...............................
Demographic and Economic Statistics ....................... ...............................
PrincipalEmployers .................................................. ...............................
Full -Time Equivalent Village Government Employees by Function........
Operating Indicators by Function/Program ............... ...............................
Capital Asset Statistics by Function/Program ............ ...............................
REQUIRED REPORTS
Report on Internal Control Over Financial Reporting and on
Compliance and Other Matters Based on an Audit of Financial
Statements Performed in Accordance with Government Auditing Standards.
Management Letter in Accordance with the Rules of the Auditor General of the
Stateof Florida ................................................................. ...............................
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INTRODUCTORY SECTION
THE VILLAGE OF
NORTH PALM BEACH
-- - THE BEST PLACE TO LIVE UNDER THE SUN
March 28, 2013
The Honorable Mayor and Members of the Village Council
Village of North Palm Beach
North Palm Beach, Florida
The Finance Department and Village Manager's Office are pleased to submit the Comprehensive
Annual Financial Report for the Village of North Palm Beach, Florida for the fiscal year ended
September 30, 2012.
This report is published to provide the Village Council, Village staff, our citizens, our lenders, and other
interested parties with detailed information concerning the financial condition and activities of the
Village government. Responsibility for both the accuracy of the presented data and the completeness
and fairness of the presentation, including all disclosures, rests with the Village.
To the best of our knowledge and belief, the enclosed data are accurate in all material respects, and
are organized in a manner designed to fairly present the financial position and results of operations of
the Village as measured by the financial activity of its various funds. We also believe that all disclosures
necessary to enable the reader to gain the maximum understanding of the Village's financial affairs
have been included.
THE REPORT
Nowlen, Holt & Miner, P.A., Certified Public Accountants, have issued an unqualified ( "clean ") opinion
on the Village of North Palm Beach's financial statements for the year ended September 30, 2012. The
independent auditor's report is located at the front of the financial section of this report.
Management's Discussion and Analysis (MD &A) immediately follows the independent auditor's report
and provides a narrative, overview, and analysis of the basic financial statements. MD &A complements
this letter of transmittal and should be read in conjunction with it.
The CAFR's role is to assist in making economic, social and political decisions and to assist in
assessing accountability to the citizenry by:
• comparing actual financial results with the legally adopted budget, where appropriate;
• assessing financial condition and results of operations;
• assisting in determining compliance with finance related laws, rules and regulations;
• assisting in evaluating the efficiency and effectiveness of Village operations.
501 U.S. Highway 1, North Palm Beach, FL 33408 -4902 * (561) 841 -3380 * Fax (561) 848 -3344
VILLAGE PROFILE
The Village
The Village of North Palm Beach is primarily a residential community, having been incorporated as a
political subdivision of the State of Florida in 1956. The registered population of the Village is
approximately 12,177 which increases to approximately 18,000 during the winter months by residents
who list their northern homes as their official place of residence. Residents are generally in the middle
to upper income brackets.
Located in the northeastern quadrant of Palm Beach County, Florida, the Village has an abundant
amount of waterfront property created by a number of lakes, canals, and the Atlantic Ocean.
The governing body of the Village consists of a five member Village Council, each of whom is elected to
two -year overlapping terms. The Mayor is selected by majority vote of the Council and serves for a term
of one year. Day to day affairs of the Village are under the leadership of the Village Manager who is
appointed by the Council.
FINANCIAL DATA
Financial Reporting System and Budgetary Controls
The Village's financial records for its general governmental operations are maintained on the modified
accrual basis, which means that revenues are recorded when available and measurable, and
expenditures are reported when goods and services are received and the related liabilities are incurred.
Financial reporting for its Enterprise Fund (i.e., the Country Club operation) is presented using the full
accrual basis of accounting required by GAAP for its annual financial report. The Country Club annual
budget is adopted using a modified accrual basis of accounting (identical to the general government
operations mentioned above) which is consistent with how general ledger financial records are
maintained throughout the year by the Village administration.
In developing and evaluating the Village's financial and accounting system, consideration is given to the
adequacy of internal accounting controls. Internal accounting controls are designed to provide
reasonable, but not absolute, assurance regarding: (a) the safeguarding of assets against loss from
unauthorized use or disposition; and (b) the reliability of financial records for preparing financial
statements and maintaining accountability for assets. The concept of reasonable assurance recognizes
that: (a) the cost of a control should not exceed the benefits likely to be derived; and (b) the evaluation
of costs and benefits requires estimates and judgments by management.
All internal control evaluations occur within the above framework. We believe that the Village's internal
accounting controls adequately safeguard assets and provide reasonable assurance of proper
recording of financial transactions.
The Village of North Palm Beach maintains budgetary controls through the annual budget public
hearing and approval process for GAAP -based budgets. The formal budget approval for each fiscal
year is accomplished in a manner compliant with Florida State Statute 200.065, commonly referred to
as Truth -in- Millage (TRIM).
Budget amendments require Village Council approval at public meetings. Budgetary control is
maintained at the department level within the fund (changed to fund level in 2013) by the encumbrance
of estimated purchase amounts prior to the release of purchase orders to vendors. Purchase orders,
which result in an overrun of approved departmental appropriations within the fund, are not released
until additional appropriations are made available. Encumbered amounts lapse at year -end; however,
they are re- appropriated as part of the following year's budget.
ECONOMIC OUTLOOK
Property Values
The Village obtains a major portion of its annual General Fund financial resources (56 %) from ad
valorem property taxes. Gross assessed property values increased substantially between the years
2002 through 2006, but slowed significantly in 2007. In years 2008 through 2012, area property values
declined in value, in many instances significantly, as a result of the economic downturn. This
unprecedented decline in property values was exacerbated by the number of properties in various
stages of foreclosure. Both of these real- estate issues have had an adverse impact upon the financial
resources of the Village. However, based on current market trends, it appears that there is new growth
in our community. We are processing a large number of building permits and recently have approved
plans for a very large residential development (Water Club) that will bring jobs to the community and
additional revenues to the Village. In addition, we are beginning to see an influx of new businesses to
our community that include both commercial and corporate entities. There is a delayed effect on
revenues as a result of these new businesses, but near term improvements in building permit revenues
will be realized and approximately three years from now, we will start to see significant increases in our
ad valorem revenues.
Certainly, another area of good news is the turn - around in valuation of homes. Recently, the state has
seen dramatic increases in the value of individual properties and this has been coupled with a decrease
in both foreclosures and the total time a home is on the market. That trend is certainly apparent in
South Florida where we are seeing an increase in the valuation of individual homeowner properties
which will eventually lead to the attendant improvement in our ad valorem revenues.
The Village continues to pursue annexation of surrounding unincorporated areas that complement and
enhance the services and values of our existing community. The focus of Village annexation efforts will
be providing exemplary municipal services that are revenue "neutral" to both the annexed areas and to
the Village.
Investment Revenues
The economic downturn and softening of the money market has had a significant impact on Village
investment revenues over the past few years. In the short -term, the Village made a conscious decision
to modify its investment strategies towards the Treasury market to better protect and ensure the
availability of the Village's investment balances. This move proved successful in safeguarding Village
investments during this market free fall but impacted the interest/dividend revenues to the Village. Four
years ago, with the assistance of the Village's Audit Committee, the Village adopted a "revised"
Investment Policy designed to provide safety and liquidity while maximizing investment return(s). The
newly adopted policy provided numerous investment strategies, parameters, and safeguards. The
policy additionally provided for 1/12 of the annual operating budget to be deposited in a liquid interest
bearing account so as not to impede operations should other funds be temporarily unavailable. The
Audit Committee and staff are currently exploring other investment opportunities that we believe will
improve yields in future years while still ensuring the safety of our investments.
Personnel Costs
The Village will continue to face increased financial challenges in the areas of personnel costs for both
salaries and benefits. In past years, several retirement plan amendments were implemented by the
Village and then followed by significant salary adjustments that magnified the impact and cost of the
retirement changes. The impact of these changes as well as the continuous improvement in the
financial markets has slowly begun to have a positive financial impact on both plans, but continued
Village funding is still required. Due to legislative changes and catastrophic claims losses, the Village
has encountered significant increases in annual health insurance costs during the past few years. In an
attempt to fight the continual rising cost of healthcare, the Village transitioned to a semi self- insured
health program in 2012 which offers the potential for possible savings if claims are minimized. The
Village intends to focus on Employee Wellness in the coming year in order to increase prospects for
savings. Changes mandated by the Patient Protection and Affordable Care Act (PPACA) will continue
to have a heavy financial impact on the cost of healthcare for the Village on an ongoing basis.
In 2012, agreements for all three of the Village's collective bargaining units (police, fire, and public
service workers) were successfully re- bargained in annual contractual re- openers to maintain status
quo for base salaries, with the FPE agreement amended to slightly increase the lump sum payouts for
employees topped out at the maximum salary according to the Village Pay Plan. All Collective
Bargaining Agreements run through September 30, 2013 and negotiations are expected to begin in the
spring of 2013. All wage provisions must be renegotiated during this process.
The impacts of personnel salaries and benefits in the coming years will have a large and continuing
effect on future Village financing and service priorities in the areas of staffing, public services and public
projects.
INITIATIVES AND FUTURE PROJECTS
The FY2012/2013 budget reflects a renewed commitment and predictable funding for community
infrastructure in areas such as roadways, neighborhood sidewalks and lighting, public buildings, and
park facilities.
The Community Development Department continues to meet the demands of our Village's business
and neighborhood redevelopment. Community Development will continue to concentrate staff
resources in areas of construction, permitting, licensing, and community planning while reinforcing
improvements in customer service. The continuing analysis and pursuit of annexation opportunities,
zoning and redevelopment enhancements and improvement of our business and development
regulations is also a function of the Community Development Department. This Department will better
align our Village with statutory development guidelines and help to meet steadily growing expectations
of homeowners and developers. In addition, Community Development will work closely with our newly
formed Business Advisory Board to assist in the growth of our current businesses and to encourage
new businesses to come to our community.
The Parks and Recreation Department continues to enhance programs for all age groups at each of its
six facilities. The newly redeveloped Anchorage Park will host a variety of events in the upcoming year,
to include: movies in the park; organized volleyball leagues; the Village's annual fishing tournament;
and Heritage Day. The parks continue to be maintained by an outside service which has been funded
under the "contractual services" line.
The Village will be exploring the possibility of accomplishing Phase 2 of the Anchorage Park
redevelopment which will improve the dry storage facilities at the park and also create numerous new
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amenities while preserving as much green space as possible. We hope to obtain several grants
associated with this project which will defray as much as half of the cost of these improvements.
Additionally, the Village has applied for a matching grant that will pay for up to half of the proposed cost
for a new "Veterans Memorial" to be located adjacent to the Public Library. We hope to have this
memorial completed by Veterans Day, November 11, 2013.
The Public Works Department is planning to continue oversight and maintenance of Village sanitation,
infrastructure, streets, facilities, equipment, and roadways. This Department will play a major role in
maintaining and expanding our focus on community appearance during the coming year.
Public Works improvements include funding for safety improvements to every Village facility. Public
Works will also accomplish a host of infrastructure projects aimed at improving the condition of our
facilities. Public Works also plans to take steps to improve neighborhood lighting in areas identified as
having acute need throughout the Village. Roadway appearance will also be emphasized with
improved median and swale plantings.
The Police Department has continued improvements in neighborhood outreach, crime suppression, and
crime clearances. In 2008, and again in 2011 and 2012, the Village's Police Department was awarded
the coveted CALEA National Accreditation for law enforcement agencies. The Police budget includes
funding for the purchase /replacement of needed marked patrol vehicles and unmarked detective vehicles.
The Human Resources Department is currently involved in the development of a comprehensive pay
and benefits study and associated pay plan. Earlier this year, HR accomplished the conversion of our
health care coverage to a carrier that provided a more cost effective customer focused plan. We are
also in process of converting our time and attendance documentation from a manual system to a
modern systems based alternative. HR has also spearheaded an organization wide emphasis on
employee safety and will be introducing a wellness program for employees later in the year. Union
related matters were also successfully addressed and all three of the unions agreed to extension of
their agreements through FY 2013.
The Administration continues its ongoing implementation of an optical records storage system for use
by all Village operating departments. Optical record storage systems are now widely used by
governments and meet all State record storage requirements. This allows the Village to transition —
over time — from "paper" records to optically stored records. Optical storage permits digital "look up" of
any optical record "at will" through the convenience of a simple computer search. Optical storage
systems have become commonly used by many local governments, and the cost is relatively modest
when considering the time savings and customer service improvements they offer.
Our Country Club Enterprise Fund continued to show improvement in its bottom line. In 2012, the
Country Club experienced a $172,332 increase in its unrestricted fund balance, from $385,622 to
$557,954. Golf operations were responsible for this improved financial picture, with the driving range
showing a dramatic improvement in overall revenues. However, we also saw dramatic improvement in
the bottom line for our restaurant operations which reduced its annual losses by about $100,000 from
2011 to 2012. The Enterprise Fund is on solid financial footing. We believe there will be steady growth
in fund balance in future years based on improved performance in restaurant operations and based on
the continued steady performance of golf operations.
At the request of Village Council, the leadership team developed a strategic plan for the Village. The
plan developed focuses on identification of critical objectives and the accomplishment of key
improvement projects which help the Village attain those objectives.
Staff developed a total of 19 strategic initiatives which are broken into high, medium, and lower priority
projects. These projects range from infrastructure improvements to the development of new programs.
Some of the near term initiatives we are focusing on for 2013 include:
• Completion of design and construction of a new Veterans Memorial located just north of
the Village Library to honor our veterans who served in all branches of the military.
• Completion of design and construction of the second phase of improvements at our
flagship park, Anchorage Park, to improve boat storage and park amenities while
optimizing the amount of green space available.
• Implementation of a computerized timekeeping system for all employees to improve
accuracy and legal compliance associated with our timekeeping records.
• Conduct of a compensation and benefits study and subsequent development of a pay
plan that aligns with the findings in the compensation study to ensure that we fairly
compensate and retain the talented and committed staff we have.
• Creation of a vigorous safety program driven by staff from throughout the organization to
critically evaluate the safety of our facilities and our work processes.
• Conduct statistically based focus groups which will be used to accurately ascertain the
priorities of our residents and to identify future actions and improvement projects that will
address those resident priorities.
As a part of our strategic focus, we recognize that our planning must be fluid and that we must be able
to adapt to changes as they occur in our community. Because of this, we will regularly calibrate our
strategic initiatives with input from both Council and our residents. The ultimate goal is to sustain the
Village as the "Best Place to Live Under the Sun" by providing superior services, embracing and
supporting timeless traditions of the community, and by ensuring that we continue to integrate modern
amenities throughout the Village to make it a safe, comfortable, and very pleasant place to live.
OTHER INFORMATION
Independent Audit
Article 11, Section 2.18 of the Village Charter requires an annual audit of the books of account, financial
records and transactions of all administrative departments of the Village by independent certified public
accountants selected by the Village Council. This requirement has been complied with and the
independent auditor's report has been included in this report.
Certificate of Achievement
The Government Finance Officers Association of the United States and Canada (GFOA) awarded a
Certificate of Achievement of Excellence in Financial Reporting to the Village of North Palm Beach
for its Comprehensive Annual Financial Report for the fiscal year ended September 30, 2011. The
Certificate of Achievement is a prestigious national award, recognizing conformance with the highest
standards for preparation of state and local government financial reports.
Respectfully submitted,
Samia Janjua �
Director of Finance
N
Ed G -ems
Village Manager
THE VILLAGE OF NORTH PALM BEACH, FLORIDA
Title
Mayor
Vice Mayor
President Pro Tem
Council Member
Council Member
Village Manager
Director of Finance
Village Clerk
PRINCIPAL VILLAGE OFFICIALS
SEPTEMBER 30, 2012
vii
Name
David B. Norris
William L. Manuel
Darryl C. Aubrey
Robert A. Gebbia
Doug Bush
Ed Green
Sarnia Janjua
Melissa Teal
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FINANCIAL SECTION
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INDEPENDENT AUDITORS' REPORT
The Honorable Mayor and Members of the Village Council
The Village of North Palm Beach, Florida
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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
Village of North Palm Beach, Florida as of and for the year ended September 30, 2012, which
collectively comprise the Village's basic financial statements as listed in the table of contents.
These financial statements are the responsibility of the Village of North Palm Beach, Florida's
management. Our responsibility is to express opinions on these financial statements based on our
audit.
We conducted our audit in accordance with U.S. generally accepted auditing standards 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 examining, on a test basis, evidence supporting the amounts and
disclosures in the financial statements. An audit also includes 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 Village of North Palm Beach,
Florida as of September 30, 2012, and the respective changes in financial position, and, where
applicable, cash flow, thereof for the year then ended in conformity with U.S. generally accepted
accounting principles.
In accordance with Government Auditing Standards, we have also issued our report dated
March 19, 2013, on our consideration of the Village of North Palm Beach, Florida's internal
control over financial reporting and on our tests of its compliance with certain provisions of laws,
regulations, contracts, 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
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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 read in conjunction with this report in
considering the results of our audit.
Accounting principles generally accepted in the United States of America require that the
management's discussion and analysis on pages 3 through 12, Pension and Other Post
Employment Benefit trend information on pages 64 through 67, and budgetary comparison
information on pages 68 through 69 be presented to supplement the basic financial statements.
Such information, although not a part of the basic financial statements, is required by the
Governmental Accounting Standards Board, who considers it to be an essential part of financial
reporting for placing the basic financial statements in an appropriate operational, economic, or
historical context. We have applied certain limited procedures to the required supplementary
information in accordance with auditing standards generally accepted in the United States of
America, which consisted of inquiries of management about the methods of preparing the
information and comparing the information for consistency with management's responses to our
inquiries, the basic financial statements, and other knowledge we obtained during our audit of the
basic financial statements. We do not express an opinion or provide any assurance on the
information because the limited procedures do not provide us with sufficient evidence to express
an opinion or provide any assurance.
Our audit was conducted for the purpose of forming opinions on the financial statements that
collectively comprise the Village of North Palm Beach, Florida's financial statements as a whole.
The introductory section, other supplemental information and statistical section, are presented for
purposes of additional analysis and are not a required part of the financial statements. The other
supplemental information are the responsibility of management and were derived from and relate
directly to the underlying accounting and other records used to prepare the financial statements.
The information has been subjected to the auditing procedures applied in the audit of the
financial statements and certain additional procedures, including comparing and reconciling such
information directly to the underlying accounting and other records used to prepare the financial
statements or to the financial statements themselves, and other additional procedures in
accordance with auditing standards generally accepted in the United States of America. In our
opinion, the information is fairly stated in all material respects in relation to the financial
statements 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 do
not express an opinion or provide any assurance on them.
March 19, 2013
West Palm Beach, Florida
2
MANAGEMENT'S DISCUSSION AND ANALYSIS
The Village of North Palm Beach, Florida's (Village) Administration offers readers of the Village's
financial statements this narrative overview and analysis of the financial activities of the Village for the
fiscal year ended September 30 2012. Please read it in conjunction with the accompanying transmittal
letter beginning on page i, and the accompanying basic financial statements.
TABLE 1
FINANCIAL HIGHLIGHTS
(in millions)
Total net assets
Unrestricted net assets available for future use
Governmental net assets
Total revenues from all sources
Governmental revenues
Total cost of all Village programs
Governmental revenues over (under) expenses
General fund revenues over (under) expenses
General fund unassigned fund balance
As a percent of general fund expenditures
Country Club revenues over (under) expenses
Change in total long -term debt for the Village
September 30,
Increase/
Statement
2012
2011
(Decrease)
Page #
$31.25
$32.14
($0.89)
13
$12.40
$12.16
$0.24
13
$28.61
$29.56
($0.95)
13
$21.46
$21.92
($0.46)
14
$17.88
$18.35
($0.47)
14
$22.36
$21.62
$0.74
14
($0.95)
$0.42
($1.37)
15
$1.00
$1.98
($0.98)
18
$11.24
$10.68
$0.56
16
66.01%
64.35%
(0.11)
$0.05
($0.11)
$0.16
21
($0.30)
($0.31)
$0.01
USING THIS ANNUAL REPORT
This annual report consists of a series of financial statements. The three components of the financial
statements are: (1) Government -wide financial statements that include the Statement of Net Assets and
the Statement of Activities. These statements provide information about the activities of the Village as a
whole. (2) Fund financial statements tell how these services were financed in the short term, as well as
what remains for future spending. Fund financial statements also report the Village's operations in more
detail than the government -wide statements by providing information about the Village's most significant
funds. (3) Notes to the basic financial statements expand upon information reported in the government -
wide and governmental fund statements.
REPORTING THE VILLAGE AS A WHOLE
Statement of Net Assets and the Statement of Activities (Government -wide)
A frequently asked question regarding the Village's financial health is whether the year's activities
contributed positively to the overall financial well being. The Statement of Net Assets and the Statement
of Activities report information about the Village as a whole and about its activities in a way that helps
answer this question. These statements include all assets and liabilities using the accrual basis of
accounting, which is similar to the accounting used by most private - sector companies. All of the current
year's revenues and expenses are taken into account, regardless of when cash is received or paid.
J
These two statements report the Village's net assets and changes therein. Net assets, the difference
between assets and liabilities, are one way to measure the Village's financial health, or financial position.
Over time, increases or decreases in net assets are an indicator of whether the financial health is
improving or deteriorating.
The Statement of Net Assets and the Statement of Activities present information about the following:
Governmental activities - All of the Village's basic services are considered to be governmental
activities, including general government, community development, public safety, public services,
library, and recreation. Property taxes, sales taxes, utility taxes, and franchise fees finance most of
these activities.
Proprietary activities /Business type activities - The Village charges a fee to customers to cover all
or most of the cost of the services provided. The Village's Country Club is reported in this
category.
REPORTING THE VILLAGE'S MOST SIGNIFICANT FUNDS
Fund Financial Statements
The fund financial statements provide detailed information about the most significant funds - not the
Village as a whole. Some funds are required to be established by State law. However, management
establishes other funds, which aid in the management of money for particular purposes or meet legal
responsibilities associated with the usage of certain taxes, grants, and other money. The Village's three
kinds of funds - governmental, proprietary, and fiduciary - use different accounting approaches as
explained below.
Governmental Funds
Most of the Village's basic services are reported in governmental funds. Governmental funds
focus on how resources flow in and out, with balances remaining at year -end that are available for
spending. These funds are reported using an accounting method called the modified accrual
accounting method, which measures cash and all other financial assets that can readily be
converted to cash. The governmental fund statements provide a detailed short-term view of the
Village's general government operations and the basic services it provides. Governmental fund
information shows whether there are more or fewer financial resources that can be spent in the
near future to finance the Village's programs.
The Village maintains six individual governmental funds: the General Fund, one Capital Projects
Fund, and four Special Revenue Funds. Information is presented separately in the governmental
fund balance sheet and in the governmental fund statement of revenues, expenditures and changes
in fund balance for the General Fund and the Capital Projects Fund, both of which are considered
major funds (generally accepted accounting principles define a fund as major based on that fund's
size relative to the other funds of the government, or a fund may be reported as major if the
government's officials believe that fund is particularly important to financial statement users).
The remaining funds are considered non -major funds, and data from these governmental funds
are combined into a single column for an aggregated presentation. The basic governmental fund
financial statements can be found on pages 16 -19 of this report.
Proprietary Funds
The Village's only proprietary fund is the Country Club Fund, which charges customers for the
services it provides. These services are generally reported in proprietary funds. Proprietary funds
are reported in the same way that all activities are reported in the Statement of Net Assets and the
Statement of Activities. The basic proprietary fund financial statements can be found on pages
20 -22 of this report.
• Fiduciary Funds
Fiduciary funds are used to account for resources held for the benefit of parties outside the
government. The funds in this category are the Village's Pension Trust Funds and Agency Funds.
Fiduciary funds are not reflected in the government -wide financial statement because the
resources of those funds are not available to support the Village's own programs. The accounting
used for fiduciary funds is much like that used for proprietary funds. The basic fiduciary fund
financial statements can be found on pages 23 -24 of this report.
GOVERNMENT -WIDE FINANCIAL ANALYSIS
As noted earlier, net assets may serve over time as a useful indicator of a government's financial position.
In the case of the Village, assets exceeded liabilities by $31.25 million at the close of the most recent
fiscal year.
A significant portion of the Village's net assets (58.21 %) reflects its investment in capital assets (e.g.,
land, buildings, machinery, and equipment), less any related debt used to acquire those assets that is still
outstanding. The Village uses these capital assets to provide services to citizens; consequently, these
assets are not available for future spending. Although the Village'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.
Liabilities
Current liabilities
1,289
Table 2
346
461
1,635
Village
of North Palm Beach
2,433
1,974
3,778
4,061
Net Assets
6,035
Total liabilities
3,722
3,474
(In Thousands)
4,522
7,846
7,996
Governmental
Business
Activities
Activities
Total
2012 2011
2012 2011
2012
2011
Assets:
16,109
17,237
2,083
2,201
Current and other assets
$ 16,227 $ 15,799
$ 1,001 $ 890 $
17,228 $
16,689
Capital assets
16,109 17,237
5,764 6,219
21,873
23,456
Total assets
32,336 33,036
6,765 7,109
39,101
40,145
Liabilities
Current liabilities
1,289
1,500
346
461
1,635
1,961
Long -term liabilities
2,433
1,974
3,778
4,061
6,211
6,035
Total liabilities
3,722
3,474
4,124
4,522
7,846
7,996
Net assets:
Invested in capital assets,
net ofdebt
16,109
17,237
2,083
2,201
18,192
19,438
Restricted
659
548
659
548
Unrestricted
11,846
11,776
558
386
12,404
12,162
Total net assets
$ 28,614
$ 29,561
$ 2,641
$ 2,587
$ 31,255
$ 32,148
5
Governmental Activities
The cost of all governmental activities this year was $18.82 million. As shown on Table 3, Changes in
Net Assets, those who directly benefited from the programs paid for $2.80 million of this cost and $15.81
million was financed through general revenues. Governmental activities decreased the Village's net
assets by $0.95 million, thereby accounting for 106% of the total decrease in the net assets of the Village.
Kev elements of this decrease are as follows:
• Increase in OPEB expense ($156,403).
• Decrease in Ad- Valorem Taxes ($430,121).
Additional detail is shown in Table 3, which follows on the subsequent page.
Table 3
Village of North Palm Beach
Changes in Net Assets
(In Thousands)
Governmental Business
Activities Activities Total
2012 2011 2012 2011 2012 2011
Revenues:
Program revenues:
Charges for services
$ 2,798
$ 2,857
$ 3,583
$ 3,571
$ 6,381
$ 6,428
Operating grants and contributions
150
127
150
127
Capital grants and contributions
6
5
6
5
General revenues:
Property taxes
10,012
10,442
10,012
10,442
Local option gas taxes
263
260
263
260
Utility service taxes
2,165
2,198
2,165
2,198
Sales and use taxes
1,138
1,141
1,138
1,141
Franchise taxes
1,179
1,191
1,179
1,191
Investment earnings
91
97
7
9
98
106
Miscellaneous
75
31
75
31
Gain on asset disposals
-
Total revenues
17,877
18,349
3,590
3,580
21,467
21,929
Expenses:
Program expenses:
General Government
2,521
2,404
2,521
2.404
Public Safety
7,892
7,233
7,892
7,233
Public Works
4,653
4,734
4,653
4,734
Community Development & Planning
885
811
885
811
Leisure Services
2,873
2,749
2,873
2,749
Interest on long -term debt
-
Country Club
3,536
3,691
3,536
3,691
Total expenses
18,824
17,931
3,536
3,691
22,360
21,622
Increase (decrease) in net assets
(947)
418
54
(111)
(893)
307
Net assets - beginning of year
29,561
29,143
2,587
2,698
32,148
31,841
Net assets - end of year
$ 28,614
$ 29,561
$ 2,641
$ 2,587
$ 31,255
$ 32,148
7
The Village's programs include General Government, Public Safety, Public Works, Community
Development & Planning, and Leisure Services. Each program's net cost (total cost, less revenues
generated by the activities) is presented below. The net cost shows the extent to which the Village's
general taxes support each of the Village's programs.
General government
Public safety
Public works
Community development
and planning
Leisure services
Interest on long -term debt
Table 4
Village of North Palm Beach
Cost of services
(In Thousands)
2012
2011
Total Cost
Net Cost
Total Cost
Net Cost
of Services
of Services
of Services
of Services
$ 2,521
$ (2,370)
$ 2,404
$ (2,266)
7,892
(7,381)
7,233
(6,773)
4,653
(4,219)
4,734
(4,263)
885
(68)
811
50
2,873
(1,832)
2,749
(1,689)
$ 18,824 $ (15,870) $ 17,931 $ (14,941)
At the end of the current year, as compared to the prior year, many of the departments realized an increase
in their overall costs (for example, General Government increased by $0.12 million, Public Safety
increased by $0.66 million, Community Development and Planning increased by $0.07 million, and
Leisure Services increased by $0.12 million). The increase is a result of the increase in the Village's
OPEB expense.
Business Type Activities
Charges for Services (revenues) in the Business Type Activities experienced an overall increase ($0.01
million) from that of the previous year. Also, during this same time period, expenses decreased by $0.16
million. Net assets of the Proprietary Fund (Country Club) at September 30, 2012, were $2.64 million.
Net assets increased by $54,072.
Golf operations were responsible for this improved financial picture, with the driving range showing a
dramatic improvement in overall revenues. However, we also saw dramatic improvement in the bottom
line for our restaurant operations which reduced its annual losses by about $100,000 from 2011 to 2012.
An increase in revenues, while holding the line on operating costs, resulted in a positive impact in the
Village's Business Type Activities.
The Enterprise Fund is on solid financial footing. We believe there will be steady growth in fund balance
in future years based on improved performance in restaurant operations and based on the continued steady
performance of golf operations.
8
FINANCIAL ANALYSIS OF THE VILLAGE'S FUNDS
As noted earlier, the Village uses fund accounting to ensure and demonstrate compliance with finance -
related legal requirements.
Governmental Funds
The focus of the Village's governmental funds is to provide information on near -term inflows, outflows,
and balances of spendable resources. Such information is useful in assessing the Village's financing
requirements. In particular, unrestricted (unassigned /assigned) fund balance may serve as a useful
measure of a government's net resources available for spending at the end of the fiscal year.
At the end of the current fiscal year, the combined fund balance for all Governmental Funds was $14.38
million, a $0.84 increase over the 2011 fund balance of $13.54 million. Approximately 94% of the
combined ending fund balance ($13.55 million) constitutes unrestricted (unassigned /assigned) fund
balance, which is available for spending at the government's discretion. The remainder of fund balance
($0.83 million) is restricted (non - spendable /restricted) to indicate that it is not available for new spending
because it has already been committed for a variety of other restricted purposes.
General Fund
The General Fund is the chief operating fund of the Village. At the end of the current fiscal year,
unassigned fund balance of the General Fund was $11.24 million while the General Fund total fund
balance was $12.20 million. As a measure of the General Fund's liquidity, it may be useful to compare
both unassigned fund balance and total fund balance to total fund expenditures. Unassigned fund balance
is 66% of total general fund expenditures, while total fund balance represents 72% of that same amount.
The general fund unassigned fund balance ($11.24 million) represents an increase of $0.56 million over
the 2011 unassigned general fund balance of $10.68 million. Key elements of this increase are listed
below:
• Franchise Fees, Utility Service Taxes and Sales & Use Tax Revenues were budgeted based on
prior year trends ($3.48 million). For the current year, the Village received $3.61 million.
• Due to discounts for prompt payments, State law requires that only 95% of the gross ad- valorem
taxes be budgeted as revenue ($9.9 million). For the current year, the Village received $10.01
million.
The increase in the above- mentioned revenues, while holding the line on operating costs, resulted in a
positive impact in the Village's General Fund.
General Fund Budgetary Highlights
Differences between the original budget and the final amended budget were $186,594 and can be briefly
summarized as follows:
• Small Business Grant Camlover ($95,000)
• Prior Year Open Purchase Order Carryover ($91,594)
9
General Fund Budget Analysis
As shown on pages 70 -72 of this report, in the Schedule of Departmental Expenditures — Budget and
Actual, there was a favorable budget to actual cost variance of $167,851 in General Fund Departmental
Expenditures. The areas of significant budget to actual variances for the General Fund expenditures are
summarized below:
• The Village realized an overall budgetary savings of $52,883 in its anticipated employee related
costs: during the budgeting process, various assumptions, along with previous year costs, are
used in the development of the current year budget. The actual costs came in well under the
projected budgeted amount.
To counter the decrease in revenue brought about by property tax reform and the economic
downturn, the Village Manager directed Department Directors to reduce spending in a manner
that would minimize the impact on our residents. This required seeking new ways to serve our
customers. The Directors did an admirable job identifying areas to cut costs resulting in
favorable budget variances. The Village saw overall budgetary savings in operating costs of
$106,231. The areas of significant budget to actual variances for the General Fund operating
costs are summarized below:
o The Village saw overall budgetary savings in its utility costs ($29,230): the budgeted amount
included a slight increase for utilities, but the actual costs were well under the budgeted
amount.
o The Village's "Small Business Grant Program" is administered through the Community
Development Department and is structured to provide matching grants of up to $5,000 for
improvements to small business properties. Businesses would be required to match each
dollar of grant funds with one dollar from their own funds. Businesses must complete an
application and will have to meet certain criteria to qualify. In 2012, there were only three
(3) applications approved for the Grant which resulted in a budgetary savings ($84,580) in the
Community Development Department.
Capital Projects Fund
The Village's Capital Projects Fund is project specific and involves multi -year projects. Appropriations in
this fund remain open and cans, over to succeeding years until planned expenditures are made, or until
they are amended or cancelled. At the end of the current fiscal year, the total fund balance was $2.13
million, a $0.33 million increase over the 2011 fund balance of $1.79 million. This is primarily due to
capital activity and a transfer in from the General Fund to fund future capital projects.
CAPITAL ASSET AND DEBT ADMINISTRATION
Capital Assets
The capital assets of the Village are those assets that are used in the performance of Village functions.
Capital assets include equipment, buildings, land, and park facilities etc. The Village has elected to
retroactively apply the capitalization requirements of GASB Statement No 34 to major general
infrastructure assets acquired in fiscal years ending after June 30, 1980, or that were significantly
reconstructed or improved during that multiyear period.
The Village's investment in capital assets for its governmental and business -type activities as of
September 30, 2012 and 2011 amounts to $21.87 million and $23.42 million, respectively (net of
accumulated depreciation).
10
Table 5
Village of North Palm Beach
Capital Assets
(In Thousands)
Governmental Business
Activities Activities
2012
2011
2012
2011
Total
2012 2011
Land
$ 2,151
$ 2,151
$ 1,051
$ 1,051
$ 3,202
$ 3,202
Construction in progress
268
212
Total $
$ $ 3,715
268
212
Buildings and improvements
22,367
22,090
1,405
1,405
23,772
23,495
Improvements other than buildings
272
272
272
272
Improvements - golf course
5,824
5,824
5,824
5,824
Furniture, fixtures and equipment
6,944
6,959
665
678
7,609
7,637
Total assets
3 1, 73 0
31,412
9,217
9,230
40,947
40,642
Less accumulated depreciation
(15,621)
(14,175)
(3,453)
(3,050)
(19,074)
(17,225)
Net assets
$ 16,109
$ 17,237
$ 5,764
$ 6,180
$ 21,873
$ 23,417
Additional information on the Village's capital assets can be found in Note 7 on page 43 of this report.
Debt
Currently, the Village uses debt financing on an as- needed basis each year. At the end of the current fiscal
year, the Village had total long -term debt of $3.72 million, all of which is in business -type activities.
The last outstanding debt instrument in the General Fund was satisfied in 2010; therefore, there is no
long -term debt outstanding in the Village's governmental activities. None of the Village's long -term debt
comprises debt backed by the full faith and credit of the government.
Table 6
Village of North Palm Beach
Outstanding Debt
(In Thousands)
Governmental Business
Activities Activities
2012
2011
2012
2011
Total
2012 2011
Loans payable
$ 3,608
$ 3,845
$ 3,608
$ 3,845
Capital leases
107
173
107
173
Total $
$ $ 3,715
$ 4,018
$ 3,715
$ 4,018
Additional information on the Village's debt can be found in Note 8 on page 45 of this report.
11
NEXT YEAR'S BUDGET AND ECONOMIC FACTORS
The Village's Unassigned Fund Balance is viewed by the Administration as a measurement of Village
financial stability. Unassigned general fund balance increased to $11.24 million during the current 2012
fiscal year. The Village is now ready to address the economic challenges anticipated in the next few
years.
The economic outlook for the primary revenue source for Florida municipalities will be challenging, as
cities are facing state mandated reductions of property taxes. In an effort to provide tax relief and spur the
slumping housing market, the State legislature focused on property tax reform in the 2007 session. House
Bill 1B was enacted to limit the authority of local governments to levN,- ad valorem taxes for the FY 2008
budget year and beyond.
The economic downturn and decline in property values have significantly impacted Village revenues. To
address the impact of the legislation, continuing increases in the cost of employee compensation and
benefits, and the reduction of revenues, the Village will need to continue to prioritize essential services
and desired levels of service to allocate sufficient funding in future budget years.
CONTACTING THE VILLAGE'S FINANCIAL MANAGEMENT
This financial report is designed to provide our citizens, taxpayers, customers, investors, and creditors
with a general overview of the Village's finances and to show the Village's accountability for the money it
receives. If you have questions about this report or need additional financial information, contact the
Village's Finance Department, at the Village of North Palm Beach, 501 U.S. Highway 1, North Palm
Beach, Florida 33408.
12
BASIC FINANCIAL STATEMENTS
THE VILLAGE OF NORTH PALM BEACH, FLORIDA
Statement of Net Assets
September 30, 2012
Assets
Cash and cash equivalents
Investments
Accounts receivable
Inventories
Prepaids
Due from other governments
Restricted assets:
Cash and cash equivalents
Net pension assets
Intangible assets, net of amortization
Capital assets:
Nondepreciable
Depreciable (net of depreciation)
Total assets
Liabilities
Accounts payable
Accrued liabilities
Deposits
Unearned revenue
Noncurrent 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:
Recreation
Streets and roads
Public safety
Library
Other purposes
Unrestricted
Total net assets
Governmental Business -type
Activities Activities Total
$ 5,652,931 $
847,027 $
6,499,958
8,506,703
6,765,201
8,506,703
448,408
16,014
464,422
46,458
76,806
123,264
120,381
27,459
147,840
230,204
230,204
658,194
658,194
562,812
562,812
34,005
34,005
2,418,582
13,691,125
1,051,311
4,712,579
3,469,893
18,403,704
32,335,798
6,765,201
39,100,999
362,683 68,872 431,555
601,701 601,701
2,100 2,100
323,828 275,522 599,350
981,747
1,451,797
368,587
3,409,498
1,350,334
4,861,295
3,721,756
4,124,579
7,846,335
16,109,707 2,082,668 18,192,375
529,939
529,939
59,646
59,646
21,455
21,455
44,441
44,441
2,713
2,713
11,846,141
557,954 12,404,095
$ 28,614,042 $
2,640,622 $ 31,254,664
See notes to the financial statements.
13
THE VILLAGE OF NORTH PALM BEACH, FLORIDA
Statement of Activities
For the Year Ended September 30, 2012
Charges for
Functions /Programs Expenses Activities
Government:
Governmental activities
General government
Public safety
Public works
Community development and planning
Leisure services
Total governmental activities
Business -type activities - country club
Total business -type activities
Total government
14
$ 2,520,815 $
135,372
7,892,561
440,568
4,652,620
386,974
884,773
816,673
2,873,496
1,018,883
18,824,265
2,798,470
3,536,139 3,582,760
3,536,139 3,582,760
$ 22,360,404 $ 6,381,230
Program Revenues Net Expense (Revenue) and
Operating Capital Changes in Net Assets
Grants and Grants and Governmental Business -type
Contributions Contributions Activities Activities Total
$ 15,415 $
71,141
46,737
16,280 5,686
149,573 5,686
$ 149,573 $ 5,686
General Revenues:
Taxes:
Property taxes
Local option gas taxes
Utility service taxes
Franchise taxes
Sales and use taxes
Investment income
Miscellaneous
Total general revenues
Change in net assets
Net assets, beginning of year
Net assets, end of year
$ (2,370,028) $
$ (2,370,028)
(7,380,852)
(7,380,852)
(4,218,909)
(4,218,909)
(68,100)
(68,100)
(1,832,647)
(1,832,647)
(15,870,536)
(15,870,536)
46,621 46,621
46,621 46,621
(15,870,536) 46,621 (15,823,915)
10,011,748
10,011,748
263,369
263,369
2,164,920
2,164,920
1,178,598
1,178,598
1,138,097
1,138,097
90,968
7,451 98,419
75,413
75,413
14,923,113
7,451 14,930,564
(947,423) 54,072 (893,351)
29,561,465 2,586,550 32,148,015
$ 28,614,042 $ 2,640,622 $ 31.254.664
See notes to the financial statements.
15
THE VILLAGE OF NORTH PALM BEACH, FLORIDA
Balance Sheet
Governmental Funds
September 30, 2012
Assets
Cash and cash equivalents
Investments
Accounts receivable
Inventories
Prepaids
Due from other governments
Restricted cash and cash equivalents
Total assets
Liabilities and fund balances
Liabilities
Accounts payable
Accrued liabilities
Deferred revenue
Total liabilities
$ 293.899 $ $ 68.784 $ 362.683
601.701 601.701
317,697 6,131 323,828
1.213297 74.915 1.288212
Fund balances
Capital
Nonmajor
Total
Projects
Governmental
Governmental
General
Fund
Funds
Funds
Recreation
529,939
529.939
Streets and roads
$ 3.468353
$ 1129.831
$ 54.747
$ 5.651931
8.506.703
Library
44A41
8.506.703
448.408
1713
1713
448.408
46A58
Small business grants
46A58
120381
Subsquent year's expenditures
41994
120381
162384
67.820
230.204
658.194
1129.831
Unassigned
658.194
S 13A10.8T7
S 1122831
S 121567
—7-15.663.279
$ 293.899 $ $ 68.784 $ 362.683
601.701 601.701
317,697 6,131 323,828
1.213297 74.915 1.288212
Fund balances
Nonspendable:
Inventories and prepaids
166.839
166.839
Restricted for:
Recreation
529,939
529.939
Streets and roads
59,646
59.646
Public safety
21,455
2L455
Library
44A41
44A41
Other purposes
1713
1713
Assigned for:
Small business grants
84.580
84.580
Subsquent year's expenditures
41994
41994
Special revenue funds
47.652 47.652
Capital project funds
1129.831
1129.831
Unassigned
11.244.977
11.244.977
Total fund balances
11197.584 1129.831
47.652 14375.067
Total liabilities and fund balances
S 13.410.881 S 2.129.831 S
122.567 S 15.663.279
See notes to the financial statements.
16
THE VILLAGE OF NORTH PALM BEACH, FLORIDA
Reconciliation of the Balance Sheet — Governmental Funds
to the Statement of Net Assets
Governmental Funds
September 30, 2012
Fund balances - total governmental funds
Amounts reported for govermnental activities in the statement of net
assets are different because:
Capital assets used in govermnental activities are not financial
resources and therefore are not reported in the govermnental funds:
Governmental capital assets
Less: accumulated depreciation
Net pension assets related to defined benefit pension plans are not
available to pay for current -period expenditures and, therefore, are not
reported as assets in the govermnental funds:
Long -tern liabilities, including notes and bonds payable, are not due and
payable in the current period and therefore are not reported in the
governmental funds. Long term liabilities at year -end consist of:
Claims and settlements
Other posternployernent benefits
Accrued compensated absences
Net assets of governmental activities
See notes to the financial statements.
17
$ 31,730,552
(15,620,845)
(50,000)
(1,160,945)
(1,222,599)
$ 14,375,067
16,109,707
562,812
(2,433,544)
$ 28,614,042
THE VILLAGE OF NORTH PALM BEACH, FLORIDA
Statement of Revenues, Expenditures, and Changes in Fund Balances
Governmental Funds
For the Year Ended September 30, 2012
Revenues
Taxes
Licenses and permits
Intergovernmental
Charges for services
Fines and forfeitures
Investment
Miscellaneous
Total revenues
Expenditures
Current
General government
Public safetv
Public works
Community development and planning
Leisure services - recreation
Capital outla -y
Total expenditures
Excess (deficiency) of revenues
over (under) expenditures
Other financing sources (uses)
Transfers in
Transfers out
Total other financing sources (uses)
Net change in fund balances
Fund balances
Beginning of year
End of year
See notes to the financial statements.
18
Capital
Nonmajor
Total
Projects
Governmental
Governmental
General
Fund
Funds
Funds
$ 13,618,635
$
$
$ 13,618,635
810,390
810,390
1,276,129
315,549
1,591,678
1,966,179
1,966,179
140,610
140,610
90,968
90,968
130,293
130,293
18,033,204
315,549
18,348,753
2,328,568
2,328,568
7,284,206
298,812
7,583,018
3,886,698
3,886,698
844,748
844,748
2,374,748
2,374,748
317,319
161,743
16,192
495,254
17,036,287
161,743
315,004
17,513,034
996,917
(161,743)
545
835,719
500,000
500,000
(500,000)
(500,000)
(500,000)
500,000
496,917
338,257
545
835,719
11,700,667
1,791,574
47,107
13,539,348
$ 12,197,584
$ 2,129,831
$ 47,652
$ 14,375,067
See notes to the financial statements.
18
THE VILLAGE OF NORTH PALM BEACH, FLORIDA
Reconciliation of the Statement of Revenues, Expenditures, and Changes in Fund
Balances of the Governmental Funds to the Statement of Activities
For the Year Ended September 30, 2012
Net change in fund balances - total governmental funds
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 capital
assets is allocated over their estimated useful lives and reported
as depreciation expense:
Expenditures for capital assets
Less: current year depreciation
Gains and losses on disposal of capital assets are reported in the statement
of activities, whereas in the governmental funds the proceeds from the sale
increases financial resources. The difference is the net book value of the
assets retired:
Net book value for retired assets
Governmental funds report revenues when earned and
available. However, in the Statement of Activities, revenues are
recognized when earned, regardless of availability:
Developer fee
Expenses that do not use current financial resources are not
reported on the governmental funds but are included in the
statement of activities:
Change in long -term compensated absences
Change in net pension asset of defined benefit pension plans
Change in other postemployement benefits
Change in insurance liability
Change in net assets
See notes to the financial statements.
19
$ 484,562
(1,611,059)
(27,681)
(21,748)
(399,528)
(31,537)
$ 835,719
(1,126,497)
(1,151)
(175,000)
(480,494)
$ (947,423)
THE VILLAGE OF NORTH PALM BEACH, FLORIDA
Statement of Net Assets
Proprietary Fund
September 30, 2012
Assets
Current assets
Cash and cash equivalents
Accounts receivable
Inventories
Prepaids
Total current assets
Non - current assets
Intangible asset, net
Land, buildings, and equipment, net
Total non - current assets
Total assets
Liabilities
Current liabilities
Accounts payable
Deposits
Deferred revenue
Compensated absences - current portion
Capital leases - current portion
Loans payable - current portion
Total current liabilities
Non - current liabilities
Other postemployement benefits
Compensated absences
Loans payable
Total non - current liabilities
Total liabilities
Net Assets
Invested in capital assets, net of related debt
Unrestricted
Total net assets
Enterprise
$ 847,027
16,014
76,806
27,459
967,306
34,005
5,763,890
5,797,895
6,765,201
68,872
2,100
275,522
11,263
106,933
250,391
715,081
45,168
6,427
3,357,903
3,409,498
4,124,579
2,082,668
557,954
$ 2,640,622
See notes to the financial statements.
20
THE VILLAGE OF NORTH PALM BEACH, FLORIDA
Statement of Revenues, Expenses, and Changes in Net Assets
Proprietary Fund
For the Year Ended September 30, 2012
Operating expenses
Golf course maintenance expenses
Enterprise
Operating revenue
103,210
Greens fee /cart rentals /membership fees
$ 2,389,526
Golf shop revenues
318,305
Driving range revenues
257,123
Restaurant revenues
613,098
Miscellaneous
4,708
Total operating revenues
3,582,760
Operating expenses
Golf course maintenance expenses
1,235,653
Clubhouse grounds expenses
103,210
Golf shop expenses
803,449
Food and beverage expenses
653,512
Administrative and general
97,055
Insurance
3 9,8 64
Depreciation and amortization
436,045
Total operating expenses
3,368,788
Operating income
213,972
Nonoperating revenues (expenses)
Interest revenue
7,451
Interest expense
(167,351)
Total nonoperating revenues (expenses)
(159,900)
Change in net assets 54,072
Net assets - beginning 2,586,550
Net assets - ending $ 2,640,622
See notes to the financial statements.
21
THE VILLAGE OF NORTH PALM BEACH, FLORIDA
Statement of Cash Flows
Proprietary Fund
For the Year Ended September 30, 2012
Cash flows from operating activities:
Receipts from customers
Payments to suppliers for goods or services
Payments to employees for services
Net cash provided by operating activities
Cash flows from capital and related financing activities:
Principal paid on long term debt
Interest paid on debt
Acquisition of capital assets
Net cash provided (used) by capital and related financing activities
Cash flows from investing activities:
Interest and dividends on investments
Net increase (decrease) in cash and cash equivalents
Cash and cash equivalents at beginning of year
Cash and cash equivalents at end of year
Reconciliation of operating income
to net cash provided by operating activities:
Operating income
Adjustments to reconcile operating income
to net cash provided by operating activities:
Depreciation
Change in assets and liabilities
Decrease in accounts receivable
(Increase) in inventory
Decrease in prepaids
(Decrease) in accounts payable
(Decrease) in deposits
Increase in compensated absences payable
(Decrease) in deferred revenue
Increase in other postemployment benefits
Total adjustments
Net cash provided by operating activities
See notes to the financial statements.
22
Enterprise
$ 3,535,934
(2,203,179)
(757,329)
575,426
(302,785)
(167,351)
(15,000)
(485,136)
7,451
97,741
749.286
847.027
213.972
436,045
15,548
(9,585)
14,002
(51,118)
(3,150)
16,734
(59,224)
2,202
361,454
$ 575,426
THE VILLAGE OF NORTH PALM BEACH, FLORIDA
Statement of Fiduciary Net Assets
Fiduciary Funds
September 30, 2012
Assets
Cash and cash equivalents
Investments:
Common equity securities
U.S. Government agencies
Municipal bonds
Corporate bonds
U.S. Treasury bonds
Equity mutual funds
Fixed income mutual funds
Accrued interest and dividends
Accounts receivable
Prepaids
Total assets
Liabilities
Accounts payable
Due to others
Total liabilities
Net Assets
Held in trust for pension benefits
and other purposes
Employee
Retirement
Funds
$ 1,565,717
6,505,349
963,792
148,269
2,583,405
452,856
5,583,405
3,214,473
39,052
128,402
1,506
21,186,226
Agency
Funds
$ 349,412
349,412
96,677
349,412
96,677 349,412
$ 21,089,549 $
See notes to the financial statements.
23
THE VILLAGE OF NORTH PALM BEACH, FLORIDA
Statement of Changes in Fiduciary Net Assets
Fiduciary Funds
For the Year Ended September 30, 2012
Investment earnings
Dividends and interest 520,608
Net increase in fair value
of investments 2,360,855
Total investment gains 2,881,463
Less: investment expenses 114,512
Total net investment gains 2,766,951
Total additions 4,674,203
Deductions
Administrative expense 75,682
Benefits 793,916
Refund of contributions 3,003
Total deductions 872,601
Change in net assets 3,801,602
Net assets - beginning 17,287,947
Net assets - ending $ 21,089,549
See notes to the financial statements.
24
Employee
Retirement
Funds
Additions
Contributions
Employer
$ 1,363,717
Plan members
246,624
State on- behalf payments
296,911
Total contributions
1,907,252
Investment earnings
Dividends and interest 520,608
Net increase in fair value
of investments 2,360,855
Total investment gains 2,881,463
Less: investment expenses 114,512
Total net investment gains 2,766,951
Total additions 4,674,203
Deductions
Administrative expense 75,682
Benefits 793,916
Refund of contributions 3,003
Total deductions 872,601
Change in net assets 3,801,602
Net assets - beginning 17,287,947
Net assets - ending $ 21,089,549
See notes to the financial statements.
24
THE VILLAGE OF NORTH PALM BEACH, FLORIDA
Notes to the Basic Financial Statements
September 30, 2012
NOTE I — SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
A. Reporting Entity
The Village of North Palm Beach, Florida ( "the Village ") was incorporated in 1956 pursuant to
Chapter 31481, Laws of Florida, Extraordinary Session 1956. The Village is located in the
northeast portion of Palm Beach County, Florida. Its municipal area comprises approximately
1,900 acres of land and 1,200 acres of lakes, canals and lagoons. The Village's nonseasonal
population consists of approximately 13,000 residents, which increases during the winter months
to approximately 18,000 people. The Village operates under the Council- Manager form of
government and provides the following services to its residents: public safety, planning and
zoning, sanitation, library, parks, marinas, and a country club. The Village Council (the
"Council ") is responsible for legislative and fiscal control of the Village.
The underlying concept of the governmental financial reporting entity is that governmental
organizations are responsible to elected governing officials; therefore, financial reporting should
report the elected officials' accountability for those organizations. Furthermore, the financial
statements of the reporting entity should allow users to distinguish between the primary
government and its component units, if any, by communicating information about the component
units and their relationships with the primary government. A component unit is a legally
separate organization for which the elected officials of the primary government are financially
accountable. Determining factors of financial accountability includes appointment of a voting
majority, imposition of will, financial benefit or burden on a primary government, or fiscal
dependency. In addition, component units can be other organizations for which the nature and
significance of their relationship with a primary government are such that exclusion would cause
the reporting entity's financial statements to be misleading or incomplete.
Based on the application of these criteria, management has determined that no component units
exist which would require inclusion in this report. Further, the Village is not aware of any entity
that would consider the Village to be a component unit.
B. Government -wide and Fund Financial Statements
The government -wide financial statements (i.e., the statement of net assets and the statement of
activities) report information on all of the non - fiduciary activities of the Village. For the most
part, the effect of interfund activities has been removed from these statements. Governmental
activities, which are normally 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.
25
THE VILLAGE OF NORTH PALM BEACH, FLORIDA
Notes to the Basic Financial Statements
September 30, 2012
NOTE I — SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued)
B. Government -wide and Fund Financial Statements (Continued)
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.
Separate financial statements are provided for governmental funds, proprietary funds, and
fiduciary funds, even though the latter are excluded from the government -wide financial
statements. Major individual governmental funds and the major individual enterprise fund are
reported as separate columns in the fund financial statements.
C. Measurement Focus, Basis of Accounting and Financial Statement Presentation
The government -wide financial statements and proprietary fund financial statements are reported
using the accrual basis of accounting and the economic resources measurement focus. Fiduciary
funds use the accrual basis of accounting and, except for agency funds, the economic resources
measurement focus. Agency funds do not have a measurement focus. Revenues are recorded
when earned and expenses are recorded when a liability is incurred, regardless of the timing of
related cash flows. Property taxes are recognized as revenues in the year for which they are
levied. Grants and similar items are recognized as revenue as soon as all eligibility requirements
imposed by the provider have been met.
Governmental fund financial statements are reported using the current financial resources
measurement focus and the modified accrual basis of accounting. Revenues are recognized as
soon as they are both measurable and available. 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 Village considers revenues 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 Village 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, as under accrual accounting. However, debt service expenditures, as well
as expenditures related to compensated absences and claims and judgments, are recorded only
when payment is due.
Property taxes, sales taxes, franchise taxes, licenses, intergovernmental revenue, investment
income, and charges for services are all considered to be susceptible to accrual and so have been
recognized as revenue of the current fiscal period. All other revenues are considered to be
measurable and available only when received in cash by the Village.
26
THE VILLAGE OF NORTH PALM BEACH, FLORIDA
Notes to the Basic Financial Statements
September 30, 2012
NOTE I — SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued)
C. Measurement Focus, Basis ofAccountm,� and Financial Statement Presentation (Continued)
The Village reports the following major governmental funds:
General Fund
The general fund is the primary operating fund and is used to account for all financial resources
applicable to the general operations of the Village except those required to be accounted for in
another fund.
Capital Projects Fund
The capital projects fund is used to account for the cost of acquiring, constructing, and placing
into service those capital improvements which are associated with activities in the General Fund.
The Village reports the following major (and only) proprietary fund:
Country Club Enterprise Fund
The fund accounts for the activities related to the Country Club.
Additionally, the Village reports the following fund types:
Special Revenue Funds
The Village has four special revenue funds to account for the proceeds of specific revenue
sources that are legally restricted to expenditures for specific sources. The funds are the Public
Safety Fund, Northlake Boulevard Fund, Recreation, and On- Behalf Pension Contributions.
Employee Retirement Funds
The pension trust funds account for the activities of the General Employees Retirement Fund and
the Fire and Police Officers Retirement Fund which accumulate resources for pension benefits to
qualified employees.
27
THE VILLAGE OF NORTH PALM BEACH, FLORIDA
Notes to the Basic Financial Statements
September 30, 2012
NOTE I — SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued)
C. Measurement Focus, Basis of Accounting and Financial Statement Presentation (Continued)
Agency Funds
The Agency Funds account for assets that are held for other parties and cannot be used to finance
the Village's own programs. The two agency funds are the Northlake Boulevard Task Force,
which is for the streetscape improvement of Northlake Boulevard, and the Manatee Protection
Fund, in which the assets are held in trust for the protection of manatees through the enforcement
of boat speed zones on the intracoastal and inland waterways.
Private sector standards of accounting and financial reporting issued prior to December 1, 1989,
generally are followed in both the government -wide and proprietary fund financial statements to
the extent that those standards do not conflict with or contradict guidance of GASB.
Governments also have the option of following subsequent private sector guidance for their
business -type activities and enterprise funds, subject to this same limitation. The Village has
elected not to follow subsequent private sector guidance.
As a general rule, the effect of interfund activity has been eliminated from the government -wide
financial statements. Exceptions to this general rule are charges between the government's
country club and various other functions of the Village. Elimination of these charges would
distort the direct costs and program revenues reported for the various functions concerned.
Proprietary funds distinguish operating revenues and expenses from non - operating items.
Operating revenues and expenses generally result from providing services and producing and
delivering goods in connection with a proprietary fund's principal ongoing operations. The
principal operating revenues of the Village's Country Club Enterprise Fund are charges to
customers for sales and services. Operating expenses for the Enterprise Fund include the cost of
sales and services, administrative expenses and depreciation on capital assets. All revenues and
expenses not meeting this definition are reported as non - operating revenues and expenses.
When both restricted and unrestricted resources are available for use, it is the Village's policy to
use restricted resources first, then unrestricted resources as they are needed.
D. Assets, Liabilities, and Net Assets or Equity
Cash and Cash Equivalents
All short-term investments that are highly liquid are considered to be cash equivalents. Cash
equivalents are readily convertible to a known amount of cash, and at the day of purchase, have a
maturity date no longer than three months.
M.
THE VILLAGE OF NORTH PALM BEACH, FLORIDA
Notes to the Basic Financial Statements
September 30, 2012
NOTE I — SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued)
D. Assets, Liabilities, and Net Assets or Equity (Continued)
Accounts Receivable
Accounts receivable of the General Fund consists of billed and unbilled receivables.
Concentration of Credit Risk
The Village performs ongoing credit evaluations of its customers and does not require collateral.
The Village maintains an allowance for uncollectible accounts at a level which management
believes is sufficient to cover potential credit losses.
Investments
Investments are reported at fair value, which is determined by using various third -party pricing
sources. The Local Government Surplus Funds Trust Fund, administered by the Florida State
Board of Administration, is a "2a -7 like" pool and these investments are valued using the pooled
share price.
Interfund Transactions
Activity between funds that is representative of lending/borrowing arrangements outstanding at
the end of the fiscal year are referred to as either "due td' or "due from other funds ". Any
residual balance outstanding between the governmental activities and business -type activities are
reported in the government -wide financial statements as internal balances.
Transfers and interfund balances totally within governmental activities and those that are totally
within business -type activities are eliminated and not presented in the government wide financial
statements. Transfers and balances between governmental and business -type activities are
presented in the government -wide financial statements.
Inventories and Prepaid Items
Inventories are valued at cost determined on a last -in, first -out basis (LIFO). Inventories in the
General Fund consist of expendable supplies held for consumption. Inventories in the Enterprise
Fund consist of goods for sale to the public. The initial cost is recorded as an asset at the time
the individual inventory items are purchased and are charged against operations in the period
when used.
Certain payments to vendors reflect costs applicable to future accounting periods and are
recorded as prepaid items in both government -wide and fund financial statements.
29
THE VILLAGE OF NORTH PALM BEACH, FLORIDA
Notes to the Basic Financial Statements
September 30, 2012
NOTE I — SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued)
D. Assets, Liabilities, and Net Assets or Equity (Continued)
Capital Assets and Depreciation
Capital assets, which include property, plant, infrastructure, and equipment, are reported in the
applicable governmental or business -type activities column in the government -wide financial
statements. The Village capitalizes all land purchases. The capitalization policy for other assets
are items with an estimated life in excess of one year and an initial individual cost of $250,000
for infrastructure, $25,000 for land improvements, $50,000 for buildings and building
improvements, and $5,000 for equipment and vehicles. The Village has elected to retroactively
apply the capitalization requirements of GASB Statement No. 34 to major general infrastructure
assets acquired in fiscal years ending after June 30, 1980, or that were significantly reconstructed
or improved during that multi -year period. Infrastructure is reported in buildings and
improvements.
The accounting and reporting treatment applied to the capital assets associated with a fund are
determined by its measurement focus. General capital assets are assets of the Village as a whole.
When purchased, such assets are recorded as expenditures in the governmental funds and
capitalized as assets in the government -wide statement of net assets. General capital assets are
carried at historical cost. Where cost cannot be determined from the available records, estimated
historical cost has been used to record the estimated value of the assets. Assets acquired by gifts
or bequests are recorded at their fair value at the date of acquisition.
Capital assets of the Enterprise Fund are capitalized in the fund. The valuation basis for
Enterprise Fund capital assets is the same as those used for General capital assets. Additionally,
net interest cost is capitalized on Enterprise Fund projects during the construction period.
Additions, improvements, and other capital outlay that significantly extend the useful life of an
asset are capitalized. Other costs incurred for repairs and maintenance are expensed as incurred.
Depreciation has been provided over the estimated useful lives using the straight -line method of
depreciation. The estimated lives for each major class of depreciable capital assets are as
follows:
Buildings, improvements and infrastructure 5 -30 years
Golf course improvements 5 -30 years
Machinery and Equipment 3 -15 years
Vehicles 3 -20 years
30
THE VILLAGE OF NORTH PALM BEACH, FLORIDA
Notes to the Basic Financial Statements
September 30, 2012
NOTE 1— SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued)
D. Assets, Liabilities, and Net Assets or Equity (Continued)
Deferred Revenue
The government reports deferred revenue on its government wide statement of net assets,
proprietary statement of net assets, and governmental funds balance sheet. Deferred revenues
arise when potential revenue does not meet both the "measurable" and "available" criteria for
recognition in the current period. Deferred revenues also arise when the government receives
resources before it has a legal claim to them, as when grant monies are received prior to
incurring qualifying expenditures. In subsequent periods, when both revenue recognition criteria
are met, or when the government has a legal claim to the resources, the liability for deferred
revenue is removed and revenue is recognized.
Compensated Absences
The Village's employees are granted compensated absence pay for vacation and sick leave in
varying amounts based on length of service. Unused compensated absences are payable upon
separation from service. Vacation is accrued as a liability when the employee earns benefits.
This means that the employee has rendered services that give rise to a vacation liability and it is
probable that the Village will compensate the employee in some manner, e.g., in cash or paid
time -off, now or upon termination or retirement. The Village uses the vesting method in
accruing sick leave liability. Under the vesting method, the liability for sick leave is accrued for
employees who are eligible to receive termination payments upon separation.
Compensated absences are accrued when incurred in the government -wide and proprietary
financial statements. A liability for these amounts is reported in the governmental funds only if
they have matured, for example, as a result of employee resignations or retirements. For the
governmental funds, compensated absences are liquidated by the General Fund.
Long -Term Obligations
In the government -wide financial statements, and proprietary fund types in the fund financial
statements, long -term debt and other long -term obligations are reported as liabilities in the
applicable governmental activities, business -type activities, or proprietary fund type statement of
net assets. Bond premiums and discounts, as well as issuance costs, are deferred and amortized
over the life of the bonds using the effective interest method. Bonds payable are reported net of
the applicable bond premium or discount. Bond issuance costs are reported as deferred charges
and amortized over the term of the related debt.
31
THE VILLAGE OF NORTH PALM BEACH, FLORIDA
Notes to the Basic Financial Statements
September 30, 2012
NOTE 1— SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued)
D. Assets, Liabilities, and Net Assets or Equity (Continued)
Long -Term Obligations (Continued)
In the fund financial statements, governmental fund types recognize bond premiums and
discounts, as well as bond issuance costs, during the current period. The face amount of debt
issued is reported as other financing sources. Premiums received on debt issuances are reported
as other financing sources, while discounts on debt issuances are reported as other financing
uses. Issuance costs, whether or not withheld from the actual debt proceeds received, are
reported as debt service expenditures.
Net Assets
Equity in the government -wide statement of net assets and the proprietary fund is displayed in
three categories: 1) invested in capital assets net of related debt, 2) restricted, and 3) unrestricted.
Net assets invested in capital assets net of related debt consists of capital assets reduced by
accumulated depreciation and by any outstanding debt incurred to acquire, construct, or improve
those assets. Net assets are reported as restricted when there are legal limitations imposed on
their use by Village legislation or external restrictions by other governments, creditors, or
grantors. Unrestricted net assets consist of all net assets that do not meet the definition of either
of the other three components.
Fund Equity
Fund balance is the difference between assets and liabilities reported in governmental funds. There
are five possible components of fund balance:
• Nonspendable fund balance represents amounts that are not in spendable form or are
legally or contractually required to be maintained intact.
• Restricted fund balance represents amounts that can be spent only for specific purposes
stipulated by external providers (e.g. creditors, grantors, contributor, or laws or regulations
of other governments) or imposed by law through constitutional provisions or enabling
legislation.
• Committed fund balance represents amounts that can be used only for the specific purposes
determined by formal action of the Village Commission. The Village has no committed
funds.
• Assigned fund balance includes spendable fund balance amounts that are intended to be
used for specific purposes, as expressed by the Village Commission or Village Manager,
that are neither considered restricted or committed. The Small Business Grants is a
program the Village Council approved in the prior fiscal year to provide matching grants
of up to $5,000 for improvements to small business properties.
32
THE VILLAGE OF NORTH PALM BEACH, FLORIDA
Notes to the Basic Financial Statements
September 30, 2012
NOTE I — SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued)
D. Assets, Liabilities, and Net Assets or Equity (Continued)
Fund Equity (Continued)
• Unassigned fund balance is the residual fund balance classification for the general fund.
When both restricted and unrestricted resources are available for use, it is the Village's policy to
use restricted resources first, then unrestricted resources as they are needed The Village will first
use committed fund balance, then assigned fund balance, and then unassigned fund balance when
expenditures are incurred for purposes for which any of the unrestricted fund balance
classifications could be used.
Use of Estimates
The financial statements and related disclosures are prepared in conformity with accounting
principles generally accepted in the United States. Management is required to make estimates
and assumptions that affect the reported amounts of assets and liabilities, the disclosure of
contingent assets and liabilities at the date of the financial statements, and revenue and expenses
during the period reported. These estimates include the collectability of accounts receivable, the
use and recoverability of inventory, the useful lives and impairment of tangible assets, and the
realization of net pension assets, among others. Estimates and assumptions are reviewed
periodically and the effects of revisions are reflected in the financial statements in the period
they are determined to be necessary. Actual results could differ from those estimates.
Statement of Cash Flows
For purposes of the statement of cash flows, the Village considers all short -term investments that
are highly liquid to be cash equivalents. Cash equivalents are readily convertible to a known
amount of cash, and at the day of purchase, have a maturity date no longer than three months.
NOTE 2- STEWARDSHIP, COMPLIANCE, AND ACCOUNTABILITY
A. Bud
detary Data
Formal budgetary integration is employed as a management control device during the year for
the General Fund and the Enterprise Fund. The only governmental fund with a legally adopted
annual budget is the General Fund. This budget is adopted on a basis consistent with generally
accepted accounting principles. Except for budgeting capital expenditures and not budgeting for
depreciation, the annual appropriated budgets for the Enterprise Funds are adopted on a basis
consistent with generally accepted accounting principles. For budgeting purposes, current year
encumbrances are not treated as expenditures.
33
THE VILLAGE OF NORTH PALM BEACH, FLORIDA
Notes to the Basic Financial Statements
September 30, 2012
NOTE 2 - STEWARDSHIP, COMPLIANCE, AND ACCOUNTABILITY (Continued)
A. Budgetary Data (Continued)
The procedures for establishing budgetary data are as follows:
• In July of each year, the Village Manager submits a proposed operating budget to the
Council for the next fiscal year commencing the following October 1st. The proposed
budget includes expenditures and the means of financing them.
• During the third week of July, the Council holds public meetings to obtain taxpayer
comments.
• Upon completion of the public hearings and prior to October 1, a final operating budget
is legally enacted through the passage of an ordinance. Estimated beginning fund
balances are considered in the budgetary process.
• The Village Manager is authorized to transfer budgeted amounts up to $10,000 within a
department. Any change to the total departmental expenses must be approved by the
Village Council.
• Appropriations along with encumbrances lapse on September 30th.
Budgeted amounts are as originally adopted, or as amended by appropriate action. During the
year, several supplementary appropriations were necessary.
Encumbrance accounting is employed in governmental funds. Encumbrances (e.g. purchase
orders, contracts) outstanding at year end are reported as reservations of fund balances and do
not constitute expenditures or liabilities because the commitments will be reappropriated and
honored during the subsequent year.
B. Property Taxes
Under Florida law, the assessment of all properties and the collection of all county, municipal
and school board property taxes are consolidated in the offices of the County Property Appraiser
and the County Tax Collector. All property is reassessed according to its fair market value on
January 1 of each year and each assessment roll is submitted to the State Department of Revenue
for review to determine if the assessment rolls meet all of the appropriate requirements of State
law. The laws of the State regulating tax assessment are also designed to assure a consistent
property valuation method statewide. State Statutes permit municipalities to levy property taxes
at a rate of up to 10 mills.
The tax levy of the Village is established by the Council prior to October 1 of each year during
the budget process. The Palm Beach County Property Appraiser incorporates the Village's
millage into the total tax levy, which includes the County, County School Board, and special
district tax requirements. The millage rate assessed by the Village for the year ended
September 30, 2012, was 6.9723 ($6.9723 for each $1,000 of assessed valuation).
34
THE VILLAGE OF NORTH PALM BEACH, FLORIDA
Notes to the Basic Financial Statements
September 30, 2012
NOTE 2- STEWARDSHIP, COMPLIANCE, AND ACCOUNTABILITY (Continued)
B. Property Tees (Continued)
Taxes may be paid less a 4% discount in November or at declining discounts each month through
the month of February. All unpaid taxes become delinquent on April 1 following the year in
which they are assessed. Delinquent taxes on real property bear interest at 18% per year. On or
prior to June 1 following the tax year, certificates are offered for sale for all delinquent taxes on
real property.
After sale, tax certificates bear interest at 18% per year or at any lower rate bid by the buyer.
The certificate holder may make application for a tax deed on any unredeemed tax certificate
after a period of two years. The County holds unsold certificates. Delinquent taxes on personal
property bear interest at 18% per year until the tax is satisfied either by seizure and sale of the
property or by the five -year statute of limitations. At September 30, 2012, unpaid delinquent
taxes are not material and have not been recorded by the Village.
NOTE 3 — DEPOSITS AND INVESTMENTS
Deposits
As of September 30, 2012, the carrying amount of the Village's deposits (including fiduciary
funds) was $7,430,023, and the bank balances totaled $7,579,139. In addition to insurance
provided by the Federal Depository Insurance Corporation, deposits are held in banking
institutions approved by the State Treasurer of the State of Florida to hold public funds. Under
Florida Statutes Chapter 280, Florida Security for Public Deposits Act, the State Treasurer
requires all Florida qualified public depositories to deposit with the Treasurer or other banking
institution eligible collateral. In the event of failure of a qualified public depository, the
remaining public depositories would be responsible for covering any resulting losses. The
Village's deposits at year end are considered insured for custodial credit risk purposes.
The Village pools idle cash from all funds for the purpose of increasing income through
investment activities. Investment income from the pool is allocated back to the respective funds
based on each fund's equity in the pool with the exception of the Capital Projects Fund and the
special revenue funds.
Tn VPQtm Pn to,
The State Board of Administration is part of the Local Governments Surplus Funds Trust Fund
and is governed by Chapter 19 -7 of the Florida Administrative Code. These rules provide
guidance and establish the general operating procedures for the administration of the Local
Governments Surplus Funds Trust Fund. Additionally, the Office of the Auditor General
performs the operational audit of the activities and investments of the State Board of
Administration. The Local Government Surplus Funds Trust Fund is not a registrant with the
Securities and Exchange Commission (SEC); however, the Board has adopted operating
procedures consistent with the requirements for a 2a -7 fund.
35
THE VILLAGE OF NORTH PALM BEACH, FLORIDA
Notes to the Basic Financial Statements
September 30, 2012
NOTE 3 — DEPOSITS AND INVESTMENTS (Continued)
Investments (Continued)
On December 4, 2007, based on recommendations from an outside financial advisor, the State
Board of Administration restructured the Pool into two separate pools. Pool A, (Local
Government Surplus Funds Trust Fund Investment Pool) consisted of all money market
appropriate assets. Pool B, (Surplus Funds Trust Fund) consisted of assets that either defaulted
on a payment, paid more slowly than expected, and /or had any significant credit and liquidity
risk. At the time of the restructuring, all current pool participants had their existing balances
proportionately allocated into Pool A and Pool B. On August 3, 2009, the SBA announced
"Florida PRIME" as the highly enhanced version of the SBA's prior Local Government
Investment Pool.
At September 30, 2012, Florida PRIlVIE was assigned a "AAA(m)" principal stability fund rating
by the Standard and Poor's Ratings. Florida PREVIE is considered a SEC 2a7 -like fund, thus, the
account balance should also be considered its fair value. Fund B is not considered a SEC 2a7-
like fund and is not rated by any nationally recognized rating agency.
Fund B is accounted for as a fluctuating NAV pool. The fair value factor for September 30,
2012, was 0.94896811. The factor should be multiplied by the account balance in order to
calculate the fair value of the investment in Fund B.
The weighted average days to maturity (WAM) of Florida PRIME at September 30, 2012, was
39 days. A portfolio's WAM reflects the average maturity in days based on final maturity or
reset date, in the case of floating rate instruments. WAM measures the sensitivity of Florida
PRIlVIE to interest rate changes.
The weighted average life (WAL) of Fund B at September 30, 2012, was 4.08 years. A
portfolio's WAL is the dollar weighted average length of time until securities held reach
maturity. WAL is based on legal final maturity dates for Fund B as of September 30, 2012.
However, because Fund B consists of restricted or defaulted securities, there is considerable
uncertainty regarding the weighted average life.
As of September 30, 2012, the Village had $279,875 invested in Florida PRIME. The cost basis
of Fund B as of September 30, 2012, was $209,153 and the fair value was $198,479. Additional
information regarding the Local Government Surplus Funds Trust Fund may be obtained from
the State Board of Administration.
36
THE VILLAGE OF NORTH PALM BEACH, FLORIDA
Notes to the Basic Financial Statements
September 30, 2012
NOTE 3 — DEPOSITS AND INVESTMENTS (Continued)
Investments (Continued)
As of September 30, 2012, the Village held the following investments:
(1) Credit rating by Standard & Poor's
Investments are held in the governmental and fiduciary funds.
Interest rate risk — Interest rate risk is the risk that changes in interest rates will adversely affect
the fair value of an investment. Generally, the longer the time to maturity, the greater the
exposure to interest rate risks.
37
Moody' s
Weighted
Credit
Fair
Average
Rating
Value
Maturity
Governmental Funds:
Wells Fargo municipal money
market fund
N/R
$ 150,890
N/A
State Board of Administration
Investment Fund B
N/R
198,479
4.08 yrs. (WAL)
Florida PRIME
(1) AAA(m)
279,875
39 days
Money Market Funds
N/R
42,654
N/A
U.S. Government and Agency
Obligations
Aaa
1,326,863
1.60 yrs.
U.S. Treasury Notes
Aaa
6,938,707
1.87 yrs.
Fiduciary Funds:
Money Market Funds
N/R
1,206,743
N/A
GNMA, FNMA, FHLMC
Pools
N/R
653,043
19.59 yrs.
U.S. Government Agencies
Aaa
310,749
10.71 yrs.
Corporate Bonds
Aaa to A3
2,583,405
6.54 yrs.
U.S. Treasury Obligations
Aaa
452,856
17.05 yrs.
Municipal Bonds
Aaa to Aa2
148,269
21.74 yrs.
Common Equity Securities
N/R
6,505,348
N/A
Equity Mutual Funds
N/R
5,583,405
N/A
Fixed Income Mutual Funds
N/R
3,214,473
N/A
Total investments
$29,595,759
(1) Credit rating by Standard & Poor's
Investments are held in the governmental and fiduciary funds.
Interest rate risk — Interest rate risk is the risk that changes in interest rates will adversely affect
the fair value of an investment. Generally, the longer the time to maturity, the greater the
exposure to interest rate risks.
37
THE VILLAGE OF NORTH PALM BEACH, FLORIDA
Notes to the Basic Financial Statements
September 30, 2012
NOTE 3 — DEPOSITS AND INVESTMENTS (Continued)
Investments (Continued)
Interest rate risk (Continued)
The Village limits its exposure to fair value losses resulting from rising interest rates by
structuring the investment portfolio so that the securities mature to meet cash requirements for
ongoing operations, thereby avoiding the need to sell securities on the open market prior to
maturity; and investing operating funds primarily in short-term securities, money market mutual
funds, or similar investment pools unless it is anticipated that long -term securities can be held to
maturity without jeopardizing the liquidity requirements. The Retirement Funds do not have a
formal investment policy that limits investment maturities as a means of managing exposure to
fair value losses arising from increasing interest rates.
The Village's investment in asset backed securities consist of mortgage pass - through securities
based on pools of residential home mortgage loans which are subject to prepayments and
therefore highly sensitive to changes in interest rates.
Custodial credit risk — For an investment, custodial credit risk is the risk that, in the event of the
failure of the counterparty, the Village will not be able to recover the value of its investments
that are in the possession of an outside party. At September 30, 2012, all investments were
insured or collateralized, except the Village's three pension funds, in which the underlying
securities are held by counterparty, or by its trust department or agent but not in the Village's
name and is uninsured and unregistered. However, all securities are registered in the funds'
names.
Concentrations of credit risk — Concentration of credit risk is defined as the risk of loss attributed
to the magnitude of an investment in a single user. The Village places no limit on the amount
they may invest in any one issuer, except those in the Fire and Police Retirement Fund. Not
more than five (5) percent of the Fund's assets shall be invested in the common stock or capital
stock of any one issuing company.
Authorized Investments —The Village has adopted an investment policy that applies to all the
investment activity except the Employees' Pension Funds, which are organized and administered
separately, as listed below, or for funds related to the issuance of debt where there are other
existing policies or indentures in effect for such funds. The Village is authorized to invest its
funds as follows:
1. Interest- bearing checking, savings and time deposits in banks from the most current top
ten listed "qualified public depositories ", as defined in Chapter 280, Florida Statutes;
with a collateral pledge level of 25% or 50% as established by the State Chief Financial
Officer;
THE VILLAGE OF NORTH PALM BEACH, FLORIDA
Notes to the Basic Financial Statements
September 30, 2012
NOTE 3 — DEPOSITS AND INVESTMENTS (Continued)
Investments (Continued)
Authorized Investments (Continued)
2. Securities and Exchange Commission registered money /market mutual funds with the
highest credit quality rating from S &P and Moody's rating agencies;
3. Insurance companies with a A.M. Best minimum rating of aaa;
4. Corporate interest notes with the highest credit quality rating from S &P and Moody's
rating agencies;
5. The Local Government Surplus Funds Trust Fund or any intergovernmental investment
pool authorized pursuant to the Florida Interlocal Cooperation Act, as provided in
Chapter 163, Florida Statutes; provided all components in each pool must satisfy the
appropriate pre - qualification parameters noted for that institution;
6. Direct obligations of the United States Treasury;
7. Federal agencies and instrumentalities.
The Village General Employees' Retirement Fund is authorized to invest its funds as follows:
1. Interest- bearing checking or savings accounts in qualified public depositories, as defined
in Chapter 280, Florida Statutes;
2. Interest- bearing time deposits in qualified public depositories, as defined in Chapter 280,
Florida Statutes;
3. The Local Government Surplus Funds Trust Fund or any intergovernmental investment
pool authorized pursuant to the Florida Interlocal Cooperation Act, as provided in
Chapter 163, Florida Statutes;
4. Securities and Exchange Commission registered money market funds with the highest
credit quality rating from a nationally recognized rating agency;
5. Direct obligations of the United States Treasury;
6. Federal agencies and instrumentalities;
39
THE VILLAGE OF NORTH PALM BEACH, FLORIDA
Notes to the Basic Financial Statements
September 30, 2012
NOTE 3 — DEPOSITS AND INVESTMENTS (Continued)
Investments (Continued)
Authorized Investments (Continued)
7. Securities of, or interest in, any open -end or closed -end management -type investment
company or investment trust registered under the Investment Company Act of 1940, 15
U.S.C. sections 80a -1 et seq., as amended from time to time, provided that the portfolio
of such investment company or investment trust is limited to obligations of the United
States Government or any agency or instrumentality thereof and to repurchase
agreements fully collateralized by such United States Government obligations, and
provided that such investment company or investment trust takes delivery of such
collateral either directly or through an authorized custodian;
8. Other investments authorized by law or by ordinance by the Village.
Investments of the Fire and Police Retirement Fund can consist of the following:
1. Time or savings accounts of a national bank, a state bank insured by the Federal Deposit
Insurance Corporation, or a savings, building and loan association insured by the Federal
Deposit Insurance Corporation;
2. Obligations of the United States or obligations guaranteed as to principal and interest by
Government of the United States;
3. Bonds, stocks, or any other evidence of indebtedness issued or guaranteed by a
corporation organized under the laws of the United States, any state or organized territory
of the United States, or the District of Columbia, provided:
a. The corporation is listed on any one (1) or more of the recognized national stock
exchanges and holds a rating in one of the three (3) highest classifications by a
major rating service; and
b. The Board shall not invest more than five (5) percent of its assets in the common
stock, capital stock, bonds or indebtedness of any one (1) issuing company, nor
shall the aggregate investment of in any one (1) issuing company exceed five (5)
percent of the outstanding capital stock of that company, nor shall the aggregate
of its investments in equities at cost exceed sixty (60) percent of the pension
funds' assets;
4. Not withstanding any provision of this section to the contrary, the Board is specifically
authorized to invest in foreign securities to the extent authorized by Sections 175.071(1)
and 185.06(1)(b), Florida Statutes.
.e
THE VILLAGE OF NORTH PALM BEACH, FLORIDA
Notes to the Basic Financial Statements
September 30, 2012
NOTE 3 — DEPOSITS AND INVESTMENTS (Continued)
Investments (Continued)
A reconciliation of deposit and investments as shown on the statement of net assets and
statement of fiduciary net assets for the Village is as follows:
By Category:
Deposits
Petty cash
Investments
Total deposits and investments
Presented in the statement of net assets
Governmental activities
Cash and cash equivalents
Restricted cash and cash equivalents
Investments
Business -type activities
Cash and cash equivalents
Total statements of net assets
Presented in the statement of fiduciary net assets
Pension trust funds
Cash and cash equivalents
Investments
Agency funds
Cash and cash equivalents
Total fiduciary funds
Total deposits and investments
41
$ 7,430,023
5,750
29,595,759
$37,031,532
$ 5,652,931
658,194
8,506,703
847,027
15,664,855
1,565,717
19,451,548
349,412
21,366,677
$37,031,532
THE VILLAGE OF NORTH PALM BEACH, FLORIDA
Notes to the Basic Financial Statements
September 30, 2012
NOTE 4 — RECEIVABLES
Receivables at September 30, 2012, were as follows:
Utility franchise fees & taxes
Conroy Drive assessment
Other accounts receivable
Total accounts receivable
NOTE 5 — DEVELOPER FEE RECEIVABLE
General
Country
Fund
Club
Total
$ 413,054
$
$ 413,054
24,972
24,972
10,382
16,014
26,396
$ 448,408
$ 16,014
$ 464,422
The Village entered into an agreement with a developer on February 14, 2008, in which it agreed
to accept payment of $1,175,000 in lieu of the dedication of land for public use. The developer
paid $250,000 upon execution of the agreement. The balance due is to be paid in annual
installments of $250,000 on the anniversary date of the agreement until paid, with a final
payment of $175,000 in 2012. In accordance with Village ordinance Sec. 36 -23, amounts
received shall be utilized for parks and recreational purposes or the construction or expansion of
any public facilities or other improvements designed to mitigate the impacts of the subdivision.
NOTE 6 — INTANGIBLE ASSETS
The intangible asset consists of the right to the availability and use of reclaimed water resulting
from an agreement with Seacoast Utility Authority. The asset had an original value of $50,377
and is being amortized on a straight line basis over the period of the expected benefit of ten
years.
42
THE VILLAGE OF NORTH PALM BEACH, FLORIDA
Notes to the Basic Financial Statements
September 30, 2012
NOTE 7 — CAPITAL ASSETS
Capital Assets activity for the year ended September 30, 2012, was as follows:
Primary Government
Governmental Activities:
Capital assets not being depreciated:
Land
Construction in progress
Capital assets being depreciated:
Buildings
Improvements
Machinery and equipment
Vehicles
Total at historical cost:
Less accumulated depreciation for:
Buildings
Improvements
Machinery and equipment
Vehicles
Total accumulated depreciation
Governmental activities capital
assets, net
Beginning
General government
Ending
Balance
Additions
Deletions Transfers
Balance
Communitv development
12,278
Leisure services
$ 1151.089
$
$ $
$ 1151.089
211.625
109.744
(53,876)
267.493
9304.419
97.815
(5,114)
9397.120
11785.828
184.647
11970.475
3303.531
63.193
(109.747)
3256.977
3,656388
83,039
(51029)
3,687398
31,411880
538,438
(220,766)
31,730,552
(4,507,530)
(294,485)
5.114
(4,796.901)
(4,387,585)
(872,275)
(5,259,860)
(2,562,541)
(197,555)
108.596
(2,651,500)
(2,717,869)
(246,744)
51029
(2,911584)
(14,175,525)
(1,611,059)
165,739
(15,620345)
$ 17.237.355
$ (1.072.621)
$(55.027) $
$ 16.109.707
Depreciation expense was charged to functions /programs of the primary government as follows:
Governmental activities:
General government
$ 110,006
Public safety
353,149
Public works
684,003
Communitv development
12,278
Leisure services
451,623
Total depreciation expense, governmental activities
$1,611,059
43
THE VILLAGE OF NORTH PALM BEACH, FLORIDA
Notes to the Basic Financial Statements
September 30, 2012
NOTE 7 — CAPITAL ASSETS (Continued)
Construction Commitments
Contracts awarded but not yet completed were as follows:
Estimated
Project Description Cost
Governmental activities:
SW Neighborhoods Sidewalks and Streetlights $340,157
Business -type activities
Driving Range Building renovation 73,58I
In addition, subsequent to September 30, 2012, the Village approved purchasing three police
vehicles at a cost of $115,510 and approved the lease /purchase of eighty -two golf carts for
$472,122.
..
Beginning
Ending
Business -type activities:
Balance
Additions
Deletions Transfers
Balance
Capital assets not being depreciated:
Land
$ 1.051311
$
$ $
$ 1.051311
Construction in progress
Capital assets being depreciated:
Buildings
1.405.035
1.405.035
Improvements
6.095.930
6.095.930
Machinery and equipment
386.413
15.000
(6,633)
394.780
Vehicles
291,055
(20,820)
270235
Total at historical cost:
9229,744
15,000
(27,453)
9217291
Less accumulated depreciation for:
Buildings
(957342)
(26.731)
(984.073)
Improvements
(1,635377)
(309260)
(1,944.637)
Machinery and equipment
(320.137)
(20.706)
6.633
(334210)
Vehicles
(136,990)
(74311)
20,820
(190,481)
Total accumulated depreciation
(3,049,846)
(431,008)
27A53
(3,453,401)
Business -type activities capital
assets, net
$ 6.179.898
$ (416,008)
$ $
$ 5.763.890
Construction Commitments
Contracts awarded but not yet completed were as follows:
Estimated
Project Description Cost
Governmental activities:
SW Neighborhoods Sidewalks and Streetlights $340,157
Business -type activities
Driving Range Building renovation 73,58I
In addition, subsequent to September 30, 2012, the Village approved purchasing three police
vehicles at a cost of $115,510 and approved the lease /purchase of eighty -two golf carts for
$472,122.
..
THE VILLAGE OF NORTH PALM BEACH, FLORIDA
Notes to the Basic Financial Statements
September 30, 2012
NOTE 8 — LONG TERM LIABILITIES
Change in Long -Term Liabilities
Lon- term liability activity for the year ended September 30, 2012, was as follows:
Business -type activities
Loans payable
$ 3,844,928 $
$ (236,634)
$ 3,608,294
Amount
Capital leases
Balance
(66,151)
Balance
Due
OPEB (see note 15)
October 1,
September 30,
Within
Compensated absences
2011
Additions
Reductions 2012
One Year
Governmental activities
15,488 11,997
(9,795)
17,690
11,263
Claims and settlements
$ 18,463
$ 31,537
$ $ 50,000
$
OPEB (see note 15)
761,417
399,528
1,160,945
Compensated absences
payable
1,194,918
1,170,860
(1,143,179) 1,222,599
981,747
Total
$ 1,974,798
$ 1,601,926
$ (1,143,179) $ 2,433,544
$ 981,747
Business -type activities
Loans payable
$ 3,844,928 $
$ (236,634)
$ 3,608,294
$ 250,391
Capital leases
173,084
(66,151)
106,933
106,933
OPEB (see note 15)
28,434 16,734
45,168
Compensated absences
payable
15,488 11,997
(9,795)
17,690
11,263
Total
$ 4,061,934 $ 28,731
$ (312,580)
$ 3,778,085
$ 368,587
Governmental activities other post employment benefit obligations and compensated absences
are expected to be paid out of the general fund.
Loans Payable
$4,893,673 Promissory Notes
The Village Council adopted Resolution No. 23 -2006 authorizing the issuance of a note in the
amount of $4,893,673 to finance certain capital expenditures relating to the municipal golf
course and country club. The revenues of the Country Club are pledged to secure the loan.
Principal and interest payments are due semi - annually in the amount of $199,079, with a final
maturity date of April 1, 2024. The interest rate on the loan is 4.11% and is subject to
adjustment in the event of taxability of the interest on this note. As of September 30, 2012, the
principal amount outstanding was $3,608,294 and was for the purpose of business -type activities.
l
THE VILLAGE OF NORTH PALM BEACH, FLORIDA
Notes to the Basic Financial Statements
September 30, 2012
NOTE 8 — LONG TERM LIABILITIES (Continued)
$4,893,673 Promissory Notes (Continued)
Annual debt service requirements to maturity are as follows:
Business -type activities:
Year Ending
Principal
Interest
Total
2013
$ 250,391
$ 147,768
$ 398,159
2014
260,934
137,225
398,159
2015
271,920
126,239
398,159
2016
283,040
115,119
398,159
2017
295,287
102,872
398,159
2018-2022
1,673,531
317,264
1,990,795
2023-2024
573,191
24,048
597,239
$ 3,608,294
$ 970,535
$ 4,578,829
$284,000 Capital Lease
The Village entered into a three year capital lease agreement for the purpose of financing the
lease - purchase of $284,000 of equipment for the Country Club in October 2009. Principal and
interest payments are due monthly, with a final maturity date in December 2013. The final
payment includes a balloon payment of $96,000. As of September 30, 2012, the principal
amount outstanding was $106,933 and the net book value of the equipment was $76,920. The
rate used to impute interest was 6.3 %.
Annual debt service requirements to maturity are as follows:
Year Ending Principal Interest Total
2013 $ 106,933 $ 1,606 $ 108,539
.e
THE VILLAGE OF NORTH PALM BEACH, FLORIDA
Notes to the Basic Financial Statements
September 30, 2012
NOTE 8 — LONG TERM LIABILITIES (Continued)
Claims and Settlements
Effective October 1, 2006, the Village discontinued its participation in the Southeast Risk
Management Association ( SERMA) and joined the Florida Municipal Insurance Trust (FMIT).
However, as a former participant in SERMA, the Village is liable for claims incurred through
September 30, 2006. At September 30, 2012, there is a long -term governmental liability of
$50,000 for pending claims activity for SERMA (see related Note 9.) The liability is an
estimated based on the 2011 valuation; the 2012 valuation is not yet available. The liability is
included in governmental noncurrent liabilities in the Statement of Net Assets.
SERMA, a quasi - governmental agency, was created by an interlocal agreement, as authorized by
Chapter 163, Florida Statutes. Participating members pool their resources so as to provide a
comprehensive risk management program, including insurance coverage, whose cost is less than
the cost of each municipality obtaining insurance separately. The members are subject to
supplemental assessments in the event of deficiencies, except to the extent that deficiencies result
from a specific claim against a member in excess of the reinsurance available, such deficiency is
solely the responsibility of that member. SERMA reinsures for workers compensation and
property claims in excess of $250,000. Activity in the pool is allocated to participating members
based upon the cumulative contributions to the pool. The amount of settlements in SERMA
exceeded insurance coverage in the current fiscal year.
NOTE 9 — RISK MANAGEMENT
The Village is exposed to various risks of loss related to torts: theft of, damage to, and
destruction of assets; errors and omissions; and natural disasters.
The Village currently reports all of its risk management activities in the General Fund. Claims
expenditures and liabilities are reported when it is probable that a loss has occurred and the
amount of the loss can be reasonably estimated. These losses include an estimate of claims that
have been incurred but not reported.
Property and Casualty Group
Effective October 1, 2006, the Village discontinued its participation in the Southeast Risk
Management Association ( SERMA) and joined the Florida Municipal Insurance Trust (FMIT).
However, as a former participant in SERMA, the Village is liable for claims incurred through
September 30, 2006. The governmental liability of $50,000 is for pending claims activity for
SERMA (See related Note 8).
The Village is also covered by Florida Statutes under the Doctrine of Sovereign Immunity which
effectively limits the amount of liability of municipalities to individual claims of
$100,000/$200,000 for all claims relating to the same incident.
47
THE VILLAGE OF NORTH PALM BEACH, FLORIDA
Notes to the Basic Financial Statements
September 30, 2012
NOTE 10 — EMPLOYEE RETIREMENT PLANS
The Village maintains the following two separate single employer defined benefit plans: Village
of North Palm Beach Fire and Police Retirement Fund, covering firefighters and police officers,
and Village of North Palm Beach General Employees Retirement Fund, covering substantially
all other full -time Village employees. Both plans are reported as pension trust funds and
included as part of the Village's reporting entity. The Police and Fire Fund will issue separate
financial statements for the year ended September 30, 2012, the report may be obtained from the
Village Clerk. The General Employees Plan will not issue separate financial statements.
Additional information on these plans can be found beginning on page 65.
Each plan has its own board that acts as plan administrator and trustee: Board of Trustees (for
the Fire and Police Retirement Fund) and General Employees Retirement Board. Each plan's
assets may only be used for the payment of benefits to the members and beneficiaries of the plan
in accordance with the terms of each plan document. The costs of administering each plan are
financed in the appropriate pension trust fund.
SUMMARY OF SIGNIFICANT ACCO UNTING POLICIES
All Retirement Plans
Basis of Accounting. The retirement plans are reported on the accrual basis of accounting. Plan
member and state contributions are recognized as revenues in the period that the contributions
are due. Employer contributions to each plan are recognized when due and the employer has
made a formal commitment to provide the contributions. Benefits and refunds are recognized
when due and payable in accordance with the terms of each plan.
Method Used to Value Investments. Investments are reported at fair value and are managed by
third party money managers. The Village's independent custodians and individual money
managers price each instrument using various third parry pricing sources.
Investments Concentrations. The following investments represent concentrations of 5% or more
of net plan assets in investments that are not issued or guaranteed by the U.S. government.
General Employees Retirement Fund
No nongovernmental investments exceed 5% of net plan assets.
Fire and Police Retirement Fund
No nongovernmental investments exceed 5% of net plan assets.
M.
THE VILLAGE OF NORTH PALM BEACH, FLORIDA
Notes to the Basic Financial Statements
September 30, 2012
NOTE 10 — EMPLOYEE RETIREMENT PLANS (Continued)
PLAN DESCRIPTIONAND CONTRIBUTION INFORMATION
The following schedule is provided for general information purposes only and is derived from
the respective actual reports and Village information for the two retirement plans as of
October 1, 2011, the date of the latest actuarial valuation. Plan participants should refer to the
appropriate source documents for more complete information on the plans.
Plan Description:
Authority
Asset Valuation:
Reporting
Legal Reserves
Long -Term Receivable
Internal/Participant Loans
General Employees' Fire and Police
Village Ordinance Village Ordinance /State
Fair Value Fair Value
None None
None None
None None
Membership of each plan consisted of the following at October 1, 2011, the date of the latest
actuarial valuation:
GERF F &P
Active Participants:
Vested 51 17
Non - vested 11 36
Retirees and Beneficiaries receiving benefits 8 11
Terminated vested members 43 8
Total 113 72
General Employees' Retirement System
Plan Description. The plan is established under Code of Ordinances for the Village of North
Palm Beach, Florida, Part II, Chapter 2, and was most recently amended under Ordinance No.
2010 -07 passed and adopted on May 27, 2010. The Plan is also governed by certain provisions
of Part VII, Chapter 112, Florida Statutes and the Internal Revenue Code. The Plan provides
retirement benefits as well as death benefits. All full time general employees who are not sworn
police officers or firefighters shall become members of the system on October 1st following
completion of 12 months of employment as a condition of employment. For those employees
retired before February 1, 1982, those employees hired after September 30, 2000, or those
employees hired before October 1, 2000, who elect to contribute an extra 2 %, a 3% Cost of
Living increase is paid annually from the Plan. Authority to establish and amend the benefit
provisions of the plan rests with the Village Council.
. •
THE VILLAGE OF NORTH PALM BEACH, FLORIDA
Notes to the Basic Financial Statements
September 30, 2012
NOTE 10 — EMPLOYEE RETIREMENT PLANS (Continued)
General Employees' Retirement System (Continued)
All benefits vest based on the following years of credited service.
Years of
Credited Service
Vested %
Under 5
0%
5 or 6
50%
7 or 8
75%
9 or more
100%
Employees become eligible for normal retirement benefits after attaining the age of 60 and
completing nine years of credited service, or attaining the age of 65 (depending on employee
contribution rate). The normal retirement benefit consists of a life annuity, options available,
(subject to cost of living increases not to exceed 3% a year), of either 2 %, 2.25 %, or 2.5%
(depending on employee contribution rate) of Average Monthly earnings (AME) times credited
service up to 20 years plus 1% of AME times credited service over 20 years. Early retirement
benefits can be received at age 55. The benefit is determined as for normal retirement and
payable at normal retirement date or payable immediately after reduction by 5% for each year by
which the benefit commencement date precedes the normal retirement date. If an active member
dies, his beneficiary receives a refund of member contributions without interest. For a member
who is age 55 and has at least five years of service but who dies before commencement of
retirement benefits, a monthly benefit is payable to the designated beneficiary; the benefit is
calculated as though the member had retired on his date of death and payable according to option
elected by the employee. For an active member who has at least five years of credited service
and dies prior to reaching normal retirement date, a benefit equal to his vested accrued benefit
will be paid to his beneficiary for ten years. If an employee terminates his employment, he is
entitled to the following:
- With less than five years of credited service, a refund of member contributions
without interest and no other benefit.
- With five or more years of credited service, a refund of member contributions, the
vested accrued benefit payable at normal retirement date or at any time after age 55
is attained, with the benefit being subject to the same reduction as for early
retirement benefits. The vesting schedule is listed above.
"Average monthly earnings" is the average during the 5 years within the last 10 years of
employment which produces the highest average.
50
THE VILLAGE OF NORTH PALM BEACH, FLORIDA
Notes to the Basic Financial Statements
September 30, 2012
NOTE 10 — EMPLOYEE RETIREMENT PLANS (Continued)
General Employees' Retirement System (Continued)
"Credited service" consists of the total number of years and fractional parts of years of actual
service with the Village and shall apply to an employee whose employment is terminated with
the Village and who recommences fulltime employment within two years from the date of
termination.
Contributions. General employees may contribute 6 %, 4 %, 2% or 0% of earnings as elected by
the employee, with the retirement benefit received being based on the amount contributed. The
Village is required to contribute the amount necessary to fund the Plan properly according to the
Plan's actuary. Contribution requirements of plan members and the Village are established and
may be amended by the Village Council.
Fire and Police Retirement Svstem
Plan Description. The plan is established under Code of Ordinances for the Village of North
Palm Beach, Florida, Part II, Chapter 2, and was most recently amended under Ordinance No.
2010 -01 passed and adopted on January 14, 2010. The Plan is also governed by certain
provisions of Part VII, Chapter 112, Florida Statutes and the Internal Revenue Code. The plan
provides retirement benefits as well as death and disability benefits. All benefits vest after ten
years of credited service. All fulltime police officers or firefighters are eligible for membership
immediately upon hire. Previously, members were not eligible until October Ist following
completion of 12 months of employment. Cost of living adjustments (COLA) are provided
annually each October 1, to reflect changes in CPI (subject to maximum increases or decreases
of 3% per year). Authority to establish and amend the benefit provisions of the plan rests with
the Village Council. Employees become eligible for normal retirement benefits after attaining
the age of 55, or the date on which the member attains age 52 and 25 credited years of service.
Previously, employees became eligible for normal retirement benefits after attaining the age of
55, only. The normal retirement benefit consists of ten years certain and life thereafter, with
other options available, (subject to cost of living adjustments not to exceed 3% a year), of 2.5%
of AME times the years of credited services, with a maximum benefit of 60% of AME.
Members are eligible for non - service connected disability, after ten years of credited service and
a total and permanent disability. For service connected disability, a total and permanent
disability with no service requirement, the disability benefit consists of a ten year certain and life
annuity that can be provided by the single -sum value of the member's accrued pension benefit,
51
THE VILLAGE OF NORTH PALM BEACH, FLORIDA
Notes to the Basic Financial Statements
September 30, 2012
NOTE 10 — EMPLOYEE RETIREMENT PLANS (Continued)
Fire and Police Retirement System (Continued)
Plan Description (Continued)
but is at least 42% of AME for service connected disability and at least 25% of AME for non -
service connected disability. See the description of the General Employees' Retirement System
for the remainder of the benefits, except that early retirement and termination benefits for vested
members can be received at age 50.
Contributions. Members are required to contribute 2% of their basic compensation to the plan.
The Village is required to contribute the remaining amount to fund the plan using the Entry Age
Actuarial Cost Method. Contribution requirements of plan members and the Village are
established and may be amended by the Village Council.
The Florida Constitution requires local governments to make the actuarially determined
contribution. The Florida Division of Retirement reviews and approves each local government's
actuarial report prior to its being appropriated for use for funding purposes. Additionally, the
State collects locally authorized insurance premium surcharges which can only be distributed
after the State has ascertained that the local government has met its actuarial funding requirement
for the then most recently completed fiscal year. Contributions to the Plan from the State of
Florida totaled $264,570 during the fiscal year ended September 30, 2012.
All Retirement Plans
Annual Pension Cost and Net Pension Obligation. The Village's 2012 annual pension cost and
actual contributions for each plan are shown on the next page. The required contributions were
determined as part of the October 1, 2011, actuarial valuation for each plan. State law allows the
Village to use a portion of the State contribution to offset the Village's pension cost.
Components ofAnnual Pension Cost andNetfension Obligation
General Employees' Retirement Fund
Fire and Police Retirement Fund
Annual
Required
Eligible
Pension
Village
State
Cost
Contribution
Contribution
$638,425
$625,209
N/A
$977,735
$738,250
$230,696
52
THE VILLAGE OF NORTH PALM BEACH, FLORIDA
Notes to the Basic Financial Statements
September 30, 2012
NOTE 10 — EMPLOYEE RETIREMENT PLANS (Continued)
The following schedule was determined as part of the October 1, 2011, actuarial valuation for the
General Employees' and Fire and Police Retirement Plans.
Three -Year Trend Information
General
Annual
Employees'
Fire and Police
Annual required contribution (ARC)
$ 625,209
$ 968,946
Interest on net pension obligation (NPO)
(24,410)
(20,427)
Adjustment to ARC
37,626
29,216
Annual pension cost
638,425
977,735
Actual contributions
625,209
969,203
Decrease in NPO
13,216
8,532
NPO at beginning of year
(326,568)
(257,992)
NPO at end of year
$(313,352)
249 460
Three -Year Trend Information
53
Annual
Percentage
Net Pension
Year
Pension
Annual
of APC
Obligation
Ended
Cost (APC)
Contribution
Contributed
(Asset)
General
Employees'
9/30/10
$ 739,704
$ 759,529
102.7%
$ (185,330)
9/30/11
509,921
651,159
127.7%
(326,568)
9/30/12
638,425
625,209
97.9%
(313,352)
Fire and
Police
9/30/10
$ 893,728
$ 884,076
98.9%
$ (255,334)
9/30/11
869,409
872,067
100.3%
(257,992)
9/30/12
977,735
969,203
99.1%
(249,460)
53
THE VILLAGE OF NORTH PALM BEACH, FLORIDA
Notes to the Basic Financial Statements
September 30, 2012
NOTE 10 — EMPLOYEE RETIREMENT PLANS (Continued)
The following are the actuarial methods and significant actuarial assumptions:
Valuation date
Actuarial Cost Method
Amortized Method
Remaining Amortization
Period
Asset Valuation Method
Actuarial assumptions:
Investment rate of return*
Projected salary increase*
*Includes inflation at
Cost of living adjustments
General Employees' Fire and Police
10/1/2011
Frozen Entry Age
Level percent closed
30 years
Difference between actual
and expected return
recognized over five years.
7.5% up to retirement,
5.25% thereafter.
5.5%
4%
3% for those retired before
2/1/82 or who contribute
an extra 2 %.
10/1/2011
Aggregate
N/A (1)
N/A (1)
Five year smooth market.
8%
6%
4%
3%
(1) The aggregate actuarial cost method does not identify or separately amortize unfunded
actuarial liabilities.
Schedule of Funding Progress
As noted above, the Fire and Police Retirement System utilizes the aggregate actuarial cost
method to determine contributions to the Plan. This method does not identify or separately
amortize unfunded actuarial liabilities. The required schedule of funding progress immediately
following the notes to the financial statements presents multiyear 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 schedule of funding progress was prepared using the
entry age actuarial cost method to provide information that serves as a surrogate for the funding
progress of the Plan.
54
THE VILLAGE OF NORTH PALM BEACH, FLORIDA
Notes to the Basic Financial Statements
September 30, 2012
NOTE 10 — EMPLOYEE RETIREMENT PLANS (Continued)
Fire and Police:
Generally accepted accounting principles (GAAP) requires that financial statements for
individual pension plans be presented in the notes to the financial statements of the primary
government if separate GAAP financial reports have not been issued. The General Employees'
pension fund does not have a separate GAAP report issued, and the financial information
September 30, 2012 is presented below.
STATEMENT OF FIDUCIARY NET ASSETS
General
Employee's
Assets
Cash and cash equivalents
$ 537
Investments:
Unfunded
5,560,676
Fixed income mutual funds
Actuarial
Accounts receivable /accrued interest
and dividends
AAL
Actuarial
Actuarial
Accrued
Accounts payable
8,129
as % of
Valuation
Value of
Liability
Unfunded
Funded
Covered
Covered
Date
Assets
(AAL)
AAL
Ratio
Payroll
Payroll
10 /01 /11
$11,656,106
$14,634,876
$2,978,770
79.65%
$3,852,019
77.33%
General Employees':
Unfunded
Actuarial
AAL
Actuarial
Actuarial
Accrued
as % of
Valuation
Value of
Liability
Unfunded
Funded
Covered
Covered
Date
Assets
(AAL)
AAL
Ratio
Payroll
Payroll
10 /01 /11
$7,771,444
$11,103,522
$3,332,078
69.99%
$3,251,285
102.48%
NOTE 11
— PENSION PLAN FINANCIAL INFORMATION
Generally accepted accounting principles (GAAP) requires that financial statements for
individual pension plans be presented in the notes to the financial statements of the primary
government if separate GAAP financial reports have not been issued. The General Employees'
pension fund does not have a separate GAAP report issued, and the financial information
September 30, 2012 is presented below.
STATEMENT OF FIDUCIARY NET ASSETS
General
Employee's
Assets
Cash and cash equivalents
$ 537
Investments:
Equity mutual funds
5,560,676
Fixed income mutual funds
3,214,473
Accounts receivable /accrued interest
and dividends
30,048
Total assets
8,805,734
Liabilities
Accounts payable
8,129
Net Assets
Held in trust for pension benefits and
other purposes
$ 8797.605
55
THE VILLAGE OF NORTH PALM BEACH, FLORIDA
Notes to the Basic Financial Statements
September 30, 2012
NOTE 11— PENSION PLAN FINANCIAL INFORMATION (Continued)
STATEMENT OF CHANGES IN FIDUCIARY NET ASSETS
Additions
Contributions
Employer
Plan members
Total contributions
Investment earnings
Dividends and interest
Net increase in the fair value
of investments
Less investment expense
Total investment earnings
Total additions
Deductions
Administration
Benefit
Total deductions
Change in net assets
Net assets - beginning
Net assets - ending
NOTE 12 — ON- BEHALF PAYMENTS
General
Employees'
Pension
$ 625,209
169,466
794.675
232,419
1,017,751
(26,738)
1,223,432
2,018,107
18,416
93,868
112,284
1,905,823
6,891,782
$ 8.797.605
The state makes a contribution to the Fire and Police Officers' Retirement System from the
firefighters' and police officers' Insurance Premium Tax. For the fiscal year ended September
30, 2012, $296,911 was recorded as revenues and expenditures in the On- Behalf Pension
Contribution Special Revenue Fund relating to on- behalf payments received from the state.
56
THE VILLAGE OF NORTH PALM BEACH, FLORIDA
Notes to the Basic Financial Statements
September 30, 2012
NOTE 13 — DEFINED CONTRIBUTION PLAN
Effective October 1, 2006, all employees of the Village may participate in one of three Money
Purchase Plans that are qualified Defined Contribution Plans adopted under the provisions of
Internal Revenue Code Section 401(a). The three pension plans include Directors, General
Employees, and Municipal Employees. The defined contribution plans are administered by
International City /County Management Association and Retirement Corporation (ICMA -RC).
The ICMA -RC is a nonprofit corporation organized and existing under the laws of the State of
Delaware. Contribution requirements of employees' and the Village are established and may be
amended by the Village Council.
The vesting period for each defined contribution plan is five years, with a vesting of zero percent
in the first year, and a vesting of twenty -five percent for each year thereafter. While the plans
will not provide for retroactive funding, the vesting period shall run from each employee's
original date of hire. No loans are permitted by the plan. The normal retirement age for the plan
shall be age sixty. There is no waiting period for participation in the plan. The minimum age for
participation is eighteen.
The Village contributes 15% of participant earnings for the plan year. Earnings include regular
and bonus compensation, but do not include overtime or commissions. Employee contributions
are voluntary, after -tax contributions that are not matched by the Village. Employees may
contribute 3 %, 5 %, 10 %, or 15% of earnings to the plan. Contributions are remitted to the trusts
every payroll period.
Because the Village has little administrative involvement and does not perform the investing
function for funds in the plans, the Village's activities do not meet the criteria for inclusion in the
fiduciary funds of a government. Consequently, the plans are not included in the Village's financial
statements.
Plan detail for participating employees at September 30, 2012, is listed below:
Director's
Village contributions $79,045
Employee contributions $32,617
General Municipal
Employees Employees
57
Total
$65,669 $69,241 $213,955
$15,166 $21,815 $69,598
THE VILLAGE OF NORTH PALM BEACH, FLORIDA
Notes to the Basic Financial Statements
September 30, 2012
NOTE 14 — DEFERRED COMPENSATION PLAN ASSETS
Employees of the Village may participate in a deferred compensation plan adopted under the
provisions of Internal Revenue Code Section 457 (Deferred Compensation Plans with Respect to
Service for State and Local Governments).
The deferred compensation plan is available to all employees of the Village. Under the plan,
employees may elect to defer a portion of their salaries and avoid paying taxes on the deferred
portion until the withdrawal date. The deferred compensation amount is not available for
withdrawal by employees until termination, retirement, death, or unforeseeable emergency. A third
parry administers the deferred compensation plan.
In 1998, the Village Adopted GASB -32, Accounting and Financial Reporting for Internal
Revenue Code Section 457 Deferred Compensation Plans. The Village modified its Deferred
Compensation Plan to conform with the changes in the Internal Revenue Code brought about by the
Small Business Job Protection Act of 1996 (the "Act "). The Act requires that eligible deferred
compensation plans established and maintained by governmental employers be amended to provide
that all assets of the plan be held in trust, or under one or more appropriate annuity contracts or
custodial accounts, for the exclusive benefit of plan participants and their beneficiaries. As a result
of this change, these plan assets are not property of the Village and are not subject to the claims of
the Village's general creditors.
Because the Village has little administrative involvement and does not perform the investing
function for funds in the Plan, the Village's activities do not meet the criteria for inclusion in the
fiduciary funds of a government.
NOTE 15 — OTHER POST EMPLOYMENT BENEFITS
The Village implemented Governmental Accounting Standards Board Statement 45 (GASB 45),
Accounting and Financial Reporting by Employers for Postemployment Benefits Other Than
Pensions, effective October 1, 2008. The Village elected to implement prospectively, and the
change in accounting principle had no effect on changes in net assets /fund equity for prior
periods. Retirees of the Village pay an amount equal to the actual premium for health insurance
charged by the carrier, but there is an implied subsidy in the healthcare insurance premium for
retirees because the premium charged for these retirees is the same as the premium charged for
active employees, who are younger than retirees on average. This implied subsidy constitutes
other postemployment benefits (OPEB) under GASB 45.
Plan Description
The Village provides a single employer defined benefit health care plan to all of its employees.
The plan allows its employees and their beneficiaries, to continue to obtain health and dental
benefits upon retirement. The normal retirement age for police and firefighters is 55; the normal
retirement age for all other Village employees is either age 60 or 65, depending on the option
selected by the employee.
THE VILLAGE OF NORTH PALM BEACH, FLORIDA
Notes to the Basic Financial Statements
September 30, 2012
NOTE 15 — OTHER POST EMPLOYMENT BENEFITS (Continued)
Plan Description (Continued)
The benefits of the plan are in accordance with Florida Statutes, which are the legal authority for
the plan. The plan has no assets and does not issue a separate financial report.
Funding Policy
The Village does not directly make a contribution to the plan on behalf of retirees. Retirees and
their beneficiaries pay the same group rates as are charged to the Village for active employees by
its healthcare provider. However, the Village's actuaries, in their actuarial valuation, calculate
an offset to the cost of these benefits as an Employer Contribution, based upon an implicit rate
subsidy. This offset equals the total age- adjusted costs paid by the Village or its active
employees for coverage of the retirees and their dependents for the year net of the retiree's own
payments for the year.
Annual OPEB Cost and Net OPEB Obligation
The annual other post employment benefit (OPEB) cost is calculated based on the annual
required contribution of the employer, an amount actuarially determined in accordance with
GASB Statement No. 45. The annual required contribution represents a level of funding that, if
paid on an ongoing basis, is projected to cover normal cost each year and to amortize any
unfunded actuarial liabilities over a period not to exceed 30 years.
The annual OPEB cost and the net OPEB obligation for the Village for the current year and the
related information is as follows:
Required contribution rates:
Employer
Pay -as- you -go
Plan members
N/A
Normal cost
$ 298,096
Interest on normal cost
11,924
Amortization
190,885
Interest on amortization
7,635
Annual required contribution (ARC)
508,540
Interest on net unfunded OPEB obligation
31,594
Adjustment to ARC
(45,677)
Annual OPEB cost
494,457
Contributions made
(78,195)
Increase in net OPEB obligation
416,262
Net OPEB obligation October 1, 2011
789,851
Net OPEB obligation September 30, 2012
1206.113
59
THE VILLAGE OF NORTH PALM BEACH, FLORIDA
Notes to the Basic Financial Statements
September 30, 2012
NOTE 15 — OTHER POST EMPLOYMENT BENEFITS (Continued)
Trend Information
Three -Year Trend Information
Percentage of
Fiscal
Annual
Annual
Net
Year
OPEB
OPEB Cost
OPEB
End
Cost
Contributed
Obligation
09/30/10
$425,505
43.0%
$537,647
09/30/11
$435,205
42.0%
$789,852
09/30/12
$494,457
15.8%
$1,206,114
Funded Status
The funded status of the plan as of most recent actuarial valuation date was as follows:
Actuarial valuation date
10/01/2011
Actuarial accrued liability
$3,432,815
Actuarial value of plan assets
$
Unfunded actuarial accrued liability (UAAL)
$3,432,815
Funded ratio
0.0%
Covered payroll
$7,103,304
UAAL as a percentage of covered payroll
48.3%
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. 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 comparable 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, will present
multi -year trend information that shows whether the actuarial value of plan assets is increasing or
decreasing over time relative to the actuarial accrued liability for benefits. The Village has not
contributed assets to the plan at this time.
Actuarial Methods and Assumptions
Projections of benefits are based on the substantive plan (the plan as understood by the employer
and plan members) and includes the types of benefits in force at the valuation date and the
pattern of sharing benefit costs between the Village and the plan members to that point.
Actuarial calculations reflect a long -term perspective and employ methods and assumptions that
:1
THE VILLAGE OF NORTH PALM BEACH, FLORIDA
Notes to the Basic Financial Statements
September 30, 2012
NOTE 15 — OTHER POST EMPLOYMENT BENEFITS (Continued)
Actuarial Methods and Assumptions (Continued)
are designed to reduce short-term volatility in actuarial accrued liabilities and the actuarial value
of assets. Significant methods and assumptions were as follows:
Actuarial valuation date
Actuarial cost method
Amortization method
Remaining amortization period
Asset valuation method
Actual assumptions:
Investment rate of return
Healthcare cost trend
10/01/2008
Projected Unit Credit
Level dollar, 30 Years, closed
28 years
Unfunded
4%
6.6% for 2012 decreasing to 4% in 2083
NOTE 16 — JOINTLY GOVERNED ORGANIZATION
The Village, through an interlocal agreement with certain other municipalities and Palm Beach
County, created the Seacoast Utility Authority ( "Seacoast ") which provides water and sewer
service to the citizens of each of the participating municipalities and a portion of Palm Beach
County. Seacoast's governing board consists of one member from each participating entity.
Seacoast is an Independent Authority organized under the laws of the State of Florida, and the
Village has no participating equity ownership in Seacoast. The Village paid $153,968 to
Seacoast during the fiscal year for water and sewer service.
NOTE 17 — TRANSFERS
Interfund transfers during the year ended September 30, 2012, are as follows:
Transfer in:
Capital Projects Fund
Transfer Out:
General Fund
$500,000
The transfers from the General Fund to the other governmental funds were to move restricted
and unrestricted General Fund revenues to finance various programs that the government must
account for in other funds in accordance with budgetary authorizations, including amounts
provided as subsidies or matching funds for various grant programs.
THE VILLAGE OF NORTH PALM BEACH, FLORIDA
Notes to the Basic Financial Statements
September 30, 2012
NOTE 18 — CONTRACTS, COMMITMENTS AND CONTINGENCIES
Contingencies
The Village is involved in various litigations and claims arising in the course of operations. It is
the opinion of legal counsel that the likelihood of unfavorable outcome and the amounts of
potential losses cannot be reasonably determined for all claims at this time.
NOTE 19 — NEW ACCOUNTING STANDARDS
Below is a brief description and effective date of new accounting standards that could have a
significant impact on the Village.
In November 2010, the Governmental Accounting Standards Board (GASB) issued Statement
No. 61, The Financial Reporting Entity: Omnibus an amendment of GASB Statements No. 14
and No. 34. GASB 61 provides additional criteria for classifying entities as component units to
better assess the accountability of elected officials by ensuring that the financial reporting entity
includes organizations for which the elected officials are financially accountable or that are
determined by the government to be misleading to exclude. This statement is effective for the
fiscal year ending September 30, 2013. Management is currently evaluating the impact of the
adoption of this statement on the Village's financial statements.
In December 2010, the Governmental Accounting Standards Board (GASB) issued Statement
No. 62, Codification of Accounting and Financial Reporting Guidance Contained in Pre -
November 30, 1989 FASB and AICPA Pronouncements. GASB 62 directly incorporates the
applicable guidance from FASB and AICPA pronouncements into the state and local government
accounting and financial reporting standards, with provisions modified, as appropriate, to
recognize the effects of the governmental environment and the needs of governmental financial
statement users without affecting the substance of the applicable guidance. This statement is
effective for the fiscal year ending September 30, 2013. Management is currently evaluating the
impact of the adoption of this statement on the Village's financial statements.
In June 2011, the Governmental Accounting Standards Board (GASB) issued Statement No. 63,
Financial Reporting of Deferred Ou flows of Resources, Deferred Inflows of Resources, and Net
Position. GASB 63 will improve financial reporting by standardizing the presentation of
deferred outflows of resources and deferred inflows of resources and their effects on a
government's net position. It alleviates uncertainty about reporting those financial statement
elements by providing guidance where none previously existed. This statement is effective for
the fiscal year ending September 30, 2013. Management is currently evaluating the impact of the
adoption of this statement on the Village's financial statements.
M
THE VILLAGE OF NORTH PALM BEACH, FLORIDA
Notes to the Basic Financial Statements
September 30, 2012
NOTE 19 — NEW ACCOUNTING STANDARDS (Continued)
In March 2012, the GASB issued Statement No. 65, Items Previously Reported as Assets and
Liabilities. GASB 65 establishes accounting and financial reporting standards that reclassify, as
deferred outflows of resources or deferred inflows of resources, certain items that were
previously reported as assets and liabilities. This statement is effective for the fiscal year ending
September 30, 2014. Management is currently evaluating the impact of the adoption of this
statement on the Village's financial statements.
In March 2012, the GASB issued Statement No. 66, Technical Corrections 2012 an
amendment of GASB Statements No. 10 and No. 62. GASB 66 improves accounting and
financial reporting for a governmental reporting entity by resolving conflicting guidance that
resulted from the issuance of two pronouncements, Statement No. 54, Fund Balance Reporting
and Governmental Fund Type Definitions and Statement No. 62, Codification of Accounting and
Financial Reporting Guidance Contained in Pre - November 30, 1989 FASB and AICPA
Pronouncements. This statement is effective for the fiscal year ending September 30, 2014.
Management is currently evaluating the impact of the adoption of this statement on the Village's
financial statements.
In June 2012, the GASB issued Statement No. 67, Financial Reporting for Pension Plans an
amendment of GASB Statement 25. GASB 67 improves financial reporting by state and local
governmental pension plans primarily through enhanced note disclosures and schedules of
required supplementary information. This statement is effective for the fiscal year ending
September 30, 2014. Management is currently evaluating the impact of the adoption of this
statement on the Village's financial statements.
In June 2012, the GASB issued Statement No. 68, Accounting and Financial Reporting for
Pensions — an amendment of GASB Statement 27. GASB 68 improves financial reporting by
state and local governments for pensions. It also improves information provided by state and
local governmental employers about financial support for pensions that is provided by other
entities. This Statement results from a comprehensive review of the effectiveness of existing
standards of accounting and financial reporting for pensions with regard to providing decision -
useful information, supporting assessments of accountability and inter - period equity, and
creating additional transparency This statement is effective for the fiscal year ending September
30, 2015. Management is currently evaluating the impact of the adoption of this statement on the
Village's financial statements.
M
REQUIRED SUPPLEMENTARY INFORMATION OTHER THAN MD &A
FIDUCIARY FUNDS
Pension Trust Funds
General Employees Pension Trust Fund
Fire and Police Officers Pension Trust Fund
THE VILLAGE OF NORTH PALM BEACH, FLORIDA
Required Supplemental Information
September 30, 2012
Schedule of Funding Progress
Other Post Employment Benefits (OPEB)
10/01/08 $ $ 2,741,387 $ 2,741,387 0.0% $ 6,231,104 44.0%
10 /01 /11 $ $ 3,432,815 $ 3,432,815 0.0% $ 7,103,304 48.3%
* These are the only actuarial valuation performed to date.
(1) Projected unit credit
The schedule of funding progress presented above will present multi -year trend information that
shows whether the actuarial value of plan assets is increasing or decreasing over time
relative to the actuarial accrued liability for benefits. Because the fiscal year ended September 30,
2009, was the year of implementation of GASB 45, and the Village elected to apple the statement
prospectively, onlN, two years are presented in the schedule at this time. In future years, required
trend data will be presented. The Village has not contributed assets to the plan at this time.
•A
Actuarial
UAAL as a
Actuarial
Accrued
Unfunded
Percentage
Actuarial Value of
Liabilitv
AAL Funded
Covered of Covered
Valuation Assets
(AAL) (1)
(UAAL) Ratio
Payroll Payroll
Date* (a)
(b)
(b -a) (a/b)
(c) ((b -a) /c)
Other Post Employment Benefits (OPEB)
10/01/08 $ $ 2,741,387 $ 2,741,387 0.0% $ 6,231,104 44.0%
10 /01 /11 $ $ 3,432,815 $ 3,432,815 0.0% $ 7,103,304 48.3%
* These are the only actuarial valuation performed to date.
(1) Projected unit credit
The schedule of funding progress presented above will present multi -year trend information that
shows whether the actuarial value of plan assets is increasing or decreasing over time
relative to the actuarial accrued liability for benefits. Because the fiscal year ended September 30,
2009, was the year of implementation of GASB 45, and the Village elected to apple the statement
prospectively, onlN, two years are presented in the schedule at this time. In future years, required
trend data will be presented. The Village has not contributed assets to the plan at this time.
•A
THE VILLAGE OF NORTH PALM BEACH, FLORIDA
Required Supplemental Information
September 30, 2012
Schedule of Funding Progress
General Employees Retirement Fund (1)
10/1/2006
Actuarial
$10,490,332
$ 5,207,309
50.36%
Accrued
141.47%
UAAL as a
Actuarial
Liability
Unfunded
Percentage
Actuarial Value of
(AAL)-
AAL Funded
Covered of Covered
Valuation Assets
Entry Age(l)
(UAAL) Ratio
Payroll Payroll
Date (a)
(b)
(b -a) (a/b)
(c) ((b -a) /c)
General Employees Retirement Fund (1)
10/1/2006
$ 5,283,023
$10,490,332
$ 5,207,309
50.36%
$ 3,680,960
141.47%
10/1/2007
6,481,382
10,997,783
4,516,401
58.93%
3,238,894
139.44%
10/1/2008
5,824,447
10,138,981
4,314,534
57.45%
2,977,995
144.88%
10/1/2009
6,048,808
8,328,331
2,279,523
72.63%
3,046,421
74.83%
10/1/2010
6,863,057
10,516,549
3,653,492
65.26%
3,424,324
106.69%
10/1/2011
7,771,444
11,103,522
3,332,078
69.99%
3,251,285
102.48%
Fire and Police Retirement Fund (2)
10/1/2006
$ 8,312,363
$10,294,848
$ 1,982,485
80.74%
$ 2,798,919
70.83%
10/1/2007
9,228,537
10,836,562
1,608,025
85.16%
3,110,081
51.70%
10/1/2008
10,376,733
11,719,336
1,342,603
88.54%
3,253,109
41.27%
10/1/2009
10,650,648
12,656,293
2,005,645
84.15%
3,488,338
57.50%
10/1/2010
11,240,540
14,121,958
2,881,418
79.60%
3,922,596
73.46%
10/1/2011
11,656,106
14,634,876
2,978,770
79.65%
3,852,019
77.33%
General Employees Retirement Fund (1)
The General Employees Retirement Fund uses the frozen entry age actuarial cost method.
Fire and Police Retirement Fund (2)
The Fire and Police Retirement Fund uses the aggregate actuarial cost method to
determine contributions to the Plan. This method does not identify or separately amortize unfunded
actuarial liabilities. The schedule of funding progress presented above was prepared using the entry age
actuarial cost method to provide information that serves as a surrogate for the funding progress of the Plan.
65
THE VILLAGE OF NORTH PALM BEACH, FLORIDA
Required Supplemental Information
September 30, 2012
Schedule of Emplover and State Contributions
Fiscal Year
Annual
Ended
Required
September 30
Contribution
General Emnlovees Retirement Fund
2007
$ 866,069
2008
875,126
2009
761,943
2010
734,626
2011
499,954
2012
625,209
Fire and Police Retirement Fund
2007
$ 539,651
2008
715,784
2009
728,729
2010
884,067
2011
869,407
2012
968,946
Actual State Percentage
$ 873,872
N/A
100.9%
876,712
N/A
100.2%
765,381
N/A
100.5%
759,529
N/A
103.4%
646,537
N/A
129.3%
625,209
N/A
100.0%
$ 401,451
$ 138,200
100.0%
577,584
138,200
100.0%
599,505
221,372
112.6%
653,372
230,696
100.0%
641,371
230,696
100.3%
738,507
230,696
100.0%
THE VILLAGE OF NORTH PALM BEACH, FLORIDA
Notes to the Trend Data
September 30, 2012
Actuarial Assumption
Investment rate of return *
General Employees
Police and Fire
5.25% thereafter.
Retirement Fund
Retirement Fund
Contribution rates as of 9/30/12:
4% 4%
Cost of living adjustments
Village
19.57%
24.21%
Plan Members
6.00%(1)
2.00%
Actuarially Determined Contribution
625,209
968,946
Contributions Made
625,209
969,203
Valuation date
10/1/2011
10/1/2011
Actuarial Cost Method
Frozen Entry Age
Aggregate
Amortized Method
Level percent
N/A (2)
closed
Remaining Amortization Period
30 years
N/A (2)
Asset Valuation Method
Difference between
Five year
actual and expected
smooth
return recognized
market
over five years.
Administrative Costs
Expenses paid out of the
Expenses paid out of the
fund other than investment
fund other than investment
related expenses are
related expenses are
assumed to be equal to the
assumed to be equal to the
average of actual expenses
average of actual expenses
over the previous ttvo years.
over the previous ttvo years.
Actuarial Assumption
Investment rate of return *
7.5% up to retirement 8%
5.25% thereafter.
Projected salary increase *
5.5% 6%
*Includes inflation at
4% 4%
Cost of living adjustments
3% for those retired 3%
before 2/1/82 or
who contribute an
extra 2 %.
(1) Except for certain members who have elected not to contribute and for other members who have elected
to contribute only 2% or 4 %.
(2) The aggregate actuarial cost method does not identify or separately amortize unfunded actuarial liabilities.
67
GENERAL FUND
THE VILLAGE OF NORTH PALM BEACH, FLORIDA
Schedule of Revenues, Expenditures, and Changes
in Fund Balance - Budget and Actual
General Fund
For the Year Ended September 30, 2012
Revenues
Taxes
Licenses and penuits
Intergovenunental
Charges for services
Fines and forfeitures
Investment
Miscellaneous
Total revenues
Expenditures
Current
General govenunent
Public safety
Public works
Connnunity development and planning
Leisure services - recreation
Other govenunent
Capital outlay
Total expenditures
Excess of revenues over
expenditures
Other financing sources (uses)
Appropriated fund balance
Transfer out
Total other financing uses
2,495,485
2,329,563
2,293,739
Variance with
7,370,838
7,290,538
7,284,206
Final Budget
Budgeted Amounts
Actual
Positive
Original
Final
Amounts
(Negative)
$ 13,387,331
$ 13,387,331
$ 13,618,635
$ 231,304
741,454
741,454
810,390
68,936
1,203,524
1,203,524
1,276,129
72,605
1,901,895
1,901,895
1,966,179
64,284
109,200
109,200
140,610
31,410
85,740
85,740
90,968
5,228
8,400
8,400
130,293
121,893
17,437,544
17,437,544
18,033,204
595,660
2,495,485
2,329,563
2,293,739
35,824
7,370,838
7,290,538
7,284,206
6,332
4,045,545
3,898,365
3,886,698
11,667
837,613
932,613
844,748
87,865
2,400,784
2,388,459
2,374,748
13,711
108,347
38,544
34,829
3,715
258,932
326,056
317,319
8,737
17,517,544
17,204,138
17,036,287
167,851
(80,000)
233,406
996,917
763,511
80,000
266,594
(266,594)
(500,000)
(500,000)
80,000
(233,406)
(500,000)
(266,594)
Net change in fund balances $
Fund Balances
Beginning of year
End of year
G'I:
$ 496,917 $ 496,917
11,700,667
$ 12,197,584
THE VILLAGE OF NORTH PALM BEACH, FLORIDA
Notes to the Budgetary
Required Supplementary Information (RSI)
General Fund
September 30, 2012
Note 1 - Basis of Accounting
Generally accepted accounting principles (GAAP) serve as the budgetary basis of accounting.
reswu
OTHER SUPPLEMENTARY INFORMATION
GENERAL FUND
THE VILLAGE OF NORTH PALM BEACH, FLORIDA
Schedule of Departmental Expenditures - Budget and Actual
General Fund
For the Year Ended September 30, 2012
Variance with
Final Budget
Original Final Positive Percent
Budget Budget Actual (Negative) Variance
Village Council
Personnel services
$ 50,452 $
50,452 $
49,642
$ 810
1.61
Operating expenses
95,902
95,902
76,236
19,666
20.51
Total Village Council
146,354
146,354
125,878
20,476
13.99
Village Manager
Personnel services
257,853
251,853
250,866
987
0.39
Operating expenses
18,861
28,861
28,721
140
0.49
Total Village Manager
276,714
280,714
279,587
1,127
0.40
Village Finance
Personnel services
482,938
469,938
469,444
494
0.11
Operating expenses
50,770
45,770
45,312
458
1.00
Total Village Finance
533,708
515,708
514,756
952
0.18
Village Attorney
Operating expenses
170,000
150,000
149,700
300
0.20
Village Clerk
Personnel services
261,714
254,639
254,641
(2)
0.00
Operating expenses
26,507
36,385
36,386
(1)
0.00
Total Village Clerk
288,221
291,024
291,027
(3)
0.00
Information Technology
Personnel services
295,378
292,803
286,355
6,448
2.20
Operating expenses
22,661
25,236
25,236
0.00
Total Information Technology
318,039
318,039
311,591
6,448
2.03
Human Resources
Personnel services
214,464
209,138
205,067
4,071
1.95
Operating expenses
26,894
32,220
32,219
1
0.00
Total Human Resources
241,358
241,358
237,286
4,072
1.69
Police
Personnel services
4,333,397
4,162,944
4,133,496
29,448
0.71
Operating expenses
204,220
271,367
295,682
(24,315)
-8.96
Total Police
4,537,617
4,434,311
4,429,178
5,133
0.12
Fire Rescue
Personnel services
2,525,621
2,574,230
2,574,231
(1)
0.00
Operating expenses
176,631
181,428
181,428
0.00
Total Fire Rescue
2,702,252
2,755,658
2,755,659
(1)
0.00
Public Works Streets and Grounds
Personnel services
324,638
324,638
349,643
(25,005)
-7.70
Operating expenses
34,711
34,711
31,259
3,452
9.94
Total Public works
359,349
359,349
380,902
(21,553)
-6.00
(Continued)
70
THE VILLAGE OF NORTH PALM BEACH, FLORIDA
Schedule of Departmental Expenditures - Budget and Actual
General Fund
For the Year Ended September 30, 2012
Vehicle Maintenance
Variance with
Personnel services
190,653
190,653
188,705
Final Budget
1.02
Operating expenses
Original
Final
229,463
Positive
Percent
Total Vehicle Maintenance
Budget
Budget
Actual
(Negative)
Variance
(Continued)
Sanitation
212,131
215,197
214,722
475
0.22
Personnel services
$ 1,296,358
$ 1,270,358
$ 1,246,430
$ 23,928
1.88
Operating expenses
155,150
131,150
126,117
5,033
3.84
Total Sanitation
1,451,508
1,401,508
1,372,547
28,961
2.07
Facility Services
470,721
470,721
487,521
(16,800)
-3.57
Personnel services
291,588
291,588
297,345
(5,757)
-1.97
Operating expenses
339,655
289,475
265,958
23,517
8.12
Total Facility Services
631,243
581,063
563,303
17,760
3.06
Street Maintenance
113,731
113,731
97,406
16,325
14.35
Personnel services
533,206
486,206
480,374
5,832
1.20
Operating expenses
681,261
681,261
671,404
9,857
1.45
Total Street Maintenance
1,214,467
1,167,467
1,151,778
15,689
1.34
Vehicle Maintenance
Personnel services
190,653
190,653
188,705
1,948
1.02
Operating expenses
198,325
198,325
229,463
(31,138)
-15.70
Total Vehicle Maintenance
388,978
388,978
418,168
(29,190)
-7.50
Planning and Engineering
Personnel services
212,131
215,197
214,722
475
0.22
Operating expenses
18,506
110,440
20,556
89,884
81.39
Total Planning and Engineering
230,637
325,637
235,278
90,359
27.75
Building
Personnel services
470,721
470,721
487,521
(16,800)
-3.57
Operating expenses
17,304
17,304
17,849
(545)
-3.15
Total Building
488,025
488,025
505,370
(17,345)
-3.55
Code Enforcement
Personnel services
113,731
113,731
97,406
16,325
14.35
Operating expenses
5,220
5,220
6,694
(1,474)
-28.24
Total Code Enforcement
118,951
118,951
104,100
14,851
12.48
Leisure Services - Recreation
Personnel services
582,888
582,888
577,243
5,645
0.97
Operating expenses
372,732
374,407
348,024
26,383
7.05
Total Leisure Services - Recreation
955,620
957,295
925,267
32,028
3.35
Library
Personnel services
502,094
488,094
487,418
676
0.14
Operating expenses
174,848
174,848
172,856
1,992
1.14
Total Library
676,942
662,942
660,274
2,668
0.40
(Continued)
71
THE VILLAGE OF NORTH PALM BEACH, FLORIDA
Schedule of Departmental Expenditures - Budget and Actual
General Fund
For the Year Ended September 30, 2012
72
Variance with
Final Budget
Original
Final
Positive
Percent
Budget
Budget
Actual
(Negative)
Variance
(Continued)
Tennis
Personnel services
$ 114,375
$ 114,375
$ 101,244
$ 13,131
11.48
Operating expenses
274,061
274,061
284,487
(10,426)
-3.80
Total Tennis
388,436
388,436
385,731
2,705
0.70
Pool
Personnel services
90,973
90,973
100,763
(9,790)
-10.76
Operating expenses
201,813
201,813
213,966
(12,153)
-6.02
Total Pool
292,786
292,786
314,729
(21,943)
-7.49
Special Events
Operating expenses
87,000
87,000
88,747
(1,747)
-2.01
Total Special Events
87,000
87,000
88,747
(1,747)
-2.01
Other
Operating expenses
108,347
38,544
34,829
3,715
9.64
108,347
38,544
34,829
3,715
9.64
Non - Departmental
Operating expenses
652,060
486,935
483,283
3,652
0.75
652,060
486,935
483,283
3,652
0.75
Capital Outlay
Information Technology
18,750
18,750
18,748
2
0.01
Police
57,582
57,582
57,582
0.00
Planning and Engineering
80,899
73,271
7,628
9.43
Sanitation
26,000
26,000
25,457
543
2.09
Leisure Services - Recreation
45,000
45,000
44,446
554
1.23
Non - Departmental
111,600
97,825
97,815
10
Total Capital Outlay
258,932
326,056
317,319
8,737
2.68
Total expenditures
$ 17,517,544
$ 17,204,138
$ 17,036 287
$ 167,851
0.98%
72
COMBINING FINANCIAL STATEMENTS
NONMAJOR GOVERNMENTAL FUNDS
Special Revenue Funds
Public Safety Fund
Northlake Boulevard Fund
Recreation Fund
On -Beha f Pension Contributions
THE VILLAGE OF NORTH PALM BEACH, FLORIDA
Combining Balance Sheet
Nonmajor Governmental Funds
September 30, 2012
73
Special Revenue Funds
Public
Northlake
On- Behalf
Total Nonmajor
Safetv
Boulevard
Pension
Governmental
Fund
Fund
Recreation
Contributions
Funds
Assets
Cash and cash equivalents
$
8.615
$ 1.986
$ 44.146
$
$ 54.747
Due from other Qovernments
67,820
67,820
Total assets
$
8.615
$ 1.986
$ 44.146
$ 67.820
$ 122567
Liabilities
Accounts payable
$
964
$
$
$ 67.820
$ 68.784
Deferred revenue
6.131
6.131
Total liabilities
7.095
67.820
74915
Fund balances
Assianed
1.520
1,986
44,146
47,652
Total fund balances
1.520
1.986
44.146
47.652
Total liabilities and fund balances
$
8.615
$ 1.986
$ 44.146
$ 67.820
$ 122.567
73
THE VILLAGE OF NORTH PALM BEACH, FLORIDA
Combining Statement of Revenues, Expenditures, and Changes in Fund Balances
Nonmajor Governmental Funds
For the Year Ended September 30, 2012
74
Special Revenue Funds
Public
Northlake
On- Behalf
Total Nonmajor
Safety
Boulevard
Pension
Governmental
Fund
Fund Recreation
Contributions
Funds
Revenues
Intergovernmental
$ 18,638
$ $
$ 296,911
$ 315,549
Total revenues
18,638
296,911
315,549
Expenditures
Current
Public safety
1,901
296,911
298,812
Capital outlay
16,192
16,192
Total expenditures
18,093
296,911
315,004
Net changes in fund balances
545
545
Fund balances - Beginning of year
975
1,986 44,146
47,107
Fund balances - End of year
$ 1,520
$ 1,986 $ 44,146
$
$ 47.652
74
FIDUCIARY FUNDS
Pension Trust Funds
General Employees Pension Trust Fund
Fire and Police Officers Pension Trust Fund
THE VILLAGE OF NORTH PALM BEACH, FLORIDA
Combining Statement of Net Assets - Fiduciary Funds
ASSETS
Cash and cash equivalents
Investments:
Common equity securities
U.S. Government agencies
Municipal bonds
Corporate bonds
U.S. Treasury bonds
Equity mutual funds
Fixed income mutual funds
Accrued interest and dividends
Accounts Receivable
Prepaids
Total assets
LIABILITIES
Accounts payable
Total liabilities
Net Assets
Held in trust for pension benefits
and other purposes
September 30, 2012
$ 8,797,605 $ 12,291,944 $ 21,089,549
(1) A schedule of funding progress for the General Employees and Fire and Police Officers plans
is presented on page 65.
75
Fire and
Total
General
Police
Employee
Employees
Officers
Retirement
Pension
Pension
Funds
$ 537
$ 1,565,180
$ 1,565,717
6,505,349
6,505,349
963,792
963,792
148,269
148,269
2,583,405
2,583,405
452,856
452,856
5,560,676
22,729
5,583,405
3,214,473
3,214,473
82
38,970
39,052
29,966
98,436
128,402
1,506
1,506
8,805,734
12,380,492
21,186,226
8,129
88,548
96,677
8,129
88,548
96,677
$ 8,797,605 $ 12,291,944 $ 21,089,549
(1) A schedule of funding progress for the General Employees and Fire and Police Officers plans
is presented on page 65.
75
THE VILLAGE OF NORTH PALM BEACH, FLORIDA
Combining Statement of Changes in Fiduciary Net Assets
Employee Retirement Funds
For the Year Ended September 30, 2012
Additions
Contributions
Employer
Plan members
State on- behalf payments
Total contributions
Investment earnings
Dividends and interest
Net increase in fair value of investments
Investment expense
Total investment gains
Total additions
Deductions
Administration
Benefits
Refund of contributions
Total deductions
Change in net assets
Net assets - beginning
Net assets - ending
Fire and Total
General Police Employee
Employees Officers Retirement
$ 625,209
$ 738,508
$ 1,363,717
169,466
77,158
246,624
296,911
296,911
794,675
1,112,577
1,907,252
232,419
288,189
520,608
1,017,751
1,343,104
2,360,855
(26,738)
(87,774)
(114,512)
1,223,432
1,543,519
2,766,951
2,018,107
2,656,096
4,674,203
18,416
57,266
75,682
93,868
700,048
793,916
3,003
3,003
112,284
760,317
872,601
1,905,823
1,895,779
3,801,602
6,891,782
10,396,165
17,287,947
$ 8,797,605
$ 12,291,944
$ 21,089,549
76
AGENCYFUNDS
Manatee Protection Agency
Northlake Boulevard Task Force
THE VILLAGE OF NORTH PALM BEACH, FLORIDA
Combining Statement of Agency Net Assets
September 30, 2012
Assets
Cash and cash equivalents
Liabilities
Due to others
Manatee
Protection
Agency
Agency Funds
Northlake
Total
Boulevard
Agency
Task Force
Funds
$ 288,150 $ 61,262 $ 349,412
$ 288,150 $ 61,262 $ 349,412
77
THE VILLAGE OF NORTH PALM BEACH, FLORIDA
Combining Schedule of Changes in Agency Net Assets and Liabilities
For the Year Ended September 30, 2012
Manatee Protection Agencv
Assets
Cash and cash equivalents
Liabilities
Due to others
Northlake Boulevard Task Force
Assets
Cash and cash equivalents
Liabilities
Due to others
Total All Agencv Funds
Assets
Cash and cash equivalents
Liabilities
Due to others
October 1, 2011 Additions Deductions September 30, 2012
285,748 $ 2,402 $ $ 288,150
$ 285,748 $ 2,402 $ $ 288,150
$ 60,751 $ 511 $ $ 61,262
60,751 $ 511 $ $ 61,262
$ 346,499 $ 2,913 $ $ 349,412
$ 346,499 $ 2,913 $ $ 349,412
79
PROPRIETARY FUND
(ENTERPRISE FUND)
Country Club Fund
THE VILLAGE OF NORTH PALM BEACH, FLORIDA
Schedule of Revenues and Departmental Expenses - Budget and Actual
Country Club Fund - Budgetary Basis
For the Year Ended September 30, 2012
Golf Maintenance
variance with
Operating expenses
1,240,715
1,240,715
1,233,653
Final Budget
0.57
Total Golf Maintenance
Original
Final
1,233,653
Positive
Percent
Golf Pro Shop and Range
Budget
Budget
Actual
(Negative)
variance
Revenue
511,412
511,412
506,396
5,016
0.98
Greens fee /cart rentalshnembershipfees
$ 2,565,250
$ 2,565,250
$ 2,389,526
$ (175,724)
-6.85
Golf shop revenues
281,500
281,500
318,305
36,805
13.07
Driving range revenues
197,380
197,380
257,123
59,743
30.27
Restaurant revenues
847,710
847,710
613,098
(234,612)
-27.68
Interest revenues
8,855
8,855
7,451
(1,404)
-15.86
Miscellaneous
507,653
507,653
4,708
4,708
29.57
Total revenues
3,900,695
3,900,695
3,590,211
(310,484)
-7.96
Golf Maintenance
Operating expenses
1,240,715
1,240,715
1,233,653
7,062
0.57
Total Golf Maintenance
1,240,715
1,240,715
1,233,653
7,062
0.57
Golf Pro Shop and Range
Personnel services
511,412
511,412
506,396
5,016
0.98
Operating expenses
352,049
352,049
297,053
54,996
15.62
Capital outlay
15,500
15,500
15,000
500
3.23
Total Golf Pro Shop and Range
878,961
878,961
818,449
60,512
6.88
Food and Beverage
Personnel services
338,948
338,948
295,978
42,970
12.68
Operating expenses
507,653
507,653
357,534
150,119
29.57
Total Food and Beverage
846,601
846,601
653,512
193,089
22.81
Administration
Personnel services
61,852
61,852
58,792
3,060
4.95
Operating expenses
36,874
36,874
26,067
10,807
29.31
Total Administration
98,726
98,726
84,859
13,867
14.05
Clubhouse and Grounds
Operating expenses
108,277
108,277
103,210
5,067
4.68
Total Clubhouse and Grounds
108,277
108,277
103,210
5,067
4.68
Insurance and General Liability
Operating expenses
39,864
39,864
39,864
0.00
Reserves
Operating
7,500
12,198
12,196
2
0.02
Contingency
209,850
205,152
2,000
203,152
99.03
Total Reserves
217,350
217,350
14,196
203,154
93.47
Debt service
Debt service
470,201
470,201
470,136
65
0.01
Total expenses on the budgetary basis
3,900,695
3,900,695
3,417,879
482,816
12.38
Revenues over expenses
$
$
$ 172,332 $
172,332
Adjustments to reconcile to the GAAP Basis
Total expenses on the budgetary basis 3,417,879
Less capital outlay costs capitalized (15,000)
Less debt service (470,136)
Add depreciation expense 436,045
Total operating expenses $ 3,368,788
79
STATISTICAL SECTION
STATISTICAL SECTION
This part of the Village of North Palm Beach's comprehensive annual financial report presents detailed unaudited information as
a context for understanding what the information in the financial statement, note disclosures, and required supplementary
information says about the Village's overall financial health.
Contents Paqe
Financial Trends
These schedules contain trend information to help the reader understand how the Village's financial
performance and well -being have changed over time. These schedules include:
Net Assets by Component 80
Changes in Net Assets 81
Fund Balances, Governmental Funds 83
Changes in Fund Balances, Governmental Fund 84
Revenue Capacity
These schedules contain information to help the reader assess the Village's most significant local
revenue source, the property tax.
Net Assessed Value and Estimated Actual Value of Taxable Property 86
Property Tax Rates - Direct and Overlapping Governments 87
Principal Property Taxpayers 88
Property Tax Levies and Collections 89
Debt Capacity
These schedules present information to help the reader assess the affordability of the Village's
current levels of outstanding debt and the Village's ability to issue additional debt in the future.
Ratios of Outstanding Debt by Type 90
Direct and Overlapping Governmental Activities Debt 91
Pledged- Revenue Coverage 92
Demographic and Economic Information
These schedules offer demographic and economic indicators to help the reader understand the
environment within which the Village's financial activities take place.
Demographic and Economic Statistics 93
Principal Employers 94
Operating Information
These schedules contain service and infrastructure data to help understand how the information
in the Village's financial report relates to the services the Village provides and the activities it performs.
Full -Time Equivalent Village Government Employees by Function 95
Operating Indicators by Function /Program 96
Capital Asset Statistics by Function /Program 97
Sources: Unless otherwise noted, the information in these schedules is derived from the comprehensive annual
financial reports for the relevant year.
VILLAGE OF NORTH PALM BEACH
NET ASSETS BY COMPONENT
LAST TEN FISCAL PEARS
(ACCRUAL BASISOFACCOUNTING) Unaudited
Fiscal Year
Business -Type Activities:
Invested in capital assets, net of related debt 2,165,529 2,131,367 1,919,194 1,999,123 2,195,630
Unrestricted (65,937) (5,195) 270,374 415,865 151,005
Total business -type activities net assets 2,099,592 2,126,172 2,189,568 2,414,988 2,346,635
Primary government
Invested in capital assets, net of related debt
2003
2004
2005
2006
2007
Governmental Activities:
613,459
470,155
19,828
154,073
113,269
Invested in capital assets, net of related debt
$ 3,563,142
$ 3,762,961
$ 3,535,596
$ 8,118,773
$ 10,543,788
Restricted
613,459
470,155
19,828
154,073
113,269
Unrestricted
2,350,342
3,527,865
6,654,989
7,143,452
9,281,170
Total governmental activities net assets
6,526,943
7,760,981
10,210,413
15,416,298
19,938,227
Business -Type Activities:
Invested in capital assets, net of related debt 2,165,529 2,131,367 1,919,194 1,999,123 2,195,630
Unrestricted (65,937) (5,195) 270,374 415,865 151,005
Total business -type activities net assets 2,099,592 2,126,172 2,189,568 2,414,988 2,346,635
Primary government
Invested in capital assets, net of related debt
5,728,671
5,894,328
5,454,790
10,117,896
12,739,418
Restricted
613,459
470,155
19,828
154,073
113,269
Unrestricted
1284.405
3.521670
6.925363
7.559317
9.431175
Total primary government net assets
$ 8,626,535
$ 9,887,153
$ 12,399,981
$ 17,831,286
$ 22,284,862
Primary government
Invested in capital assets, net of related debt
2008
2009
2010
2011
2012
Governmental Activities:
979,182
251,088
390,081
548,489
658,194
Invested in capital assets, net of related debt
$ 12,845,093
$ 16,643,241
$ 18,184,508
$ 17,237,355
$ 16,109,707
Restricted
979,182
251,088
390,081
548,489
658,194
Unrestricted
9,836,912
11,016,626
10,568,594
11,775,621
11,846,141
Total governmental activities net assets
23,661,187
27,910,955
29,143,183
29,561,465
28,614,042
Business -Type Activities:
Invested in capital assets, net of related debt
2,492,524
2,364,814
2,295,125
2,200,927
2,082,668
Unrestricted
202,802
434,212
403,261
385,623
557,954
Total business -type activities net assets
2,695,326
2,799,026
2,698,386
2,586,550
2,640,622
Primary government
Invested in capital assets, net of related debt
15,337,617
19,008,055
20,479,633
19,438,282
18,192,375
Restricted
979,182
251,088
390,081
548,489
658,194
Unrestricted
10,039, 714
11,450, 838
10,971, 855
12,161,244
12,404,095
Total primary government net assets
$ 26,356,513
$ 30,709,981
$ 31,841,569
$ 32,148,015
$ 31,254,664
Basic Financial Statements and Management's Discussion andAnalvsis for State and Local Governments.
80
Expenses
Governmental activities:
General government
Public safety
Public works
Community development and planning
Leisure services
Other government
Interest on long -Tenn debt
Total governmental activities expenses
Business -type activities:
Country club
Total business -type activities
Total primary government expenses
Program Revenues
Governmental activities:
Charges for services:
General government
Public safety
Public works
Community development and planning
Leisure services
Other government
Operating grants and contributions
Capital grants and contributions
Total governmental activities program revenues
VILLAGE OF NORTH PALM BEACH
CIANGESIN NET ASSETS
LAST TEN FISCAL YEARS
(ACCRUALBASISOFACCOUNTING) Unaudited
Fiscal Year
2003 2004 2005 2006 2007
$ 2,781,333
$ 3,174,460
$ 2,127,009
$ 1,784,528
$ 2,698,187
5,195,338
5,294,399
6,038,846
7,036,117
6,671,490
3,482,975
3,549,178
5,091,305
4,131,500
3,733.815
-
-
-
657,112
737,165
1,539,771
1,280,483
1,635,784
2,562,627
2,781,658
-
-
842,561
2,049
-
128,507
40,580
151,233
241,995
204,666
13,127,924
13,339,100
15,886.738
16,415,928
16,826,981
2,676,883
2,567,690
2,607,712
2,124,927
3,570.683
2,676,883
2,567,690
2,607,712
2,124,927
3,570.683
$ 15.804.807
$ 15.906.790
$ 18.494.450
$ 18.540.855
$ 20.397,664
$ 342,936
$ 355,118
$ 285,386
$ 158,160
$ 122,455
258,723
273,391
329,081
388,671
345,731
727,016
895,291
1,326,820
140,923
217,975
-
-
-
1,175,252
938,188
174,589
147,773
78,475
528,983
496,679
82,134
89,362
1,392,729
998,573
170,389
102,560
(13,188,200)
General revenues and other changes in net assets:
462,394
1,454,526
1,687,958
1,760,935
3,412,491
3,852,956
3,745,943
Business -type activities:
Charges for services:
Country club
2,510,258
2,548,259
2,658,468
2,167,089
3,463,524
Operating grants and contributions
-
-
-
68,883
-
Capital grants and contributions
10,000
Total business -type activities program revenues
2,520,258
2,548,259
2,658,468
2,235,972
3,463,524
Total primary government program revenues
$ 4,208,216
$ 4,309.194
$ 6.070.959
$
6.088.928
$
7,209,467
Net
Governmental activities
$ (11.439.966)
$ (11,578,165)
$ (12,474,247)
$
(12,562,972)
$
(13,081,041)
Business -type activities
(156.625)
(19.431)
50.756
111.045
(107,159)
Total primary government net expense
$ (11.596.591)
$ (11.597.596)
$ (12.423.491)
$ (12.451.927)
$
(13,188,200)
General revenues and other changes in net assets:
Governmental activities:
Taxes:
Property taxes
$ 6,365,000
$ 8,451,783
$ 10,070,977
$
10,881,501
$
12,076.184
Local option gas taxes
-
-
-
307,043
292,332
Utilitv service taxes
1,755,153
1,830,339
1,955,403
2,001,164
2,001,443
Franchise taxes
890,285
861,708
890,297
1,150,974
1,207,552
Sales and use taxes
1,148,210
1,230,803
1,277.124
1,415,917
1,339,893
Unrestricted grants and contributions
276,302
291,710
421,254
-
-
Investment earnings
75,023
53,600
196,699
477,420
650,022
Miscellaneous
54,875
92,260
111,927
53,264
8,836
Contributions for Support Our Troops
-
-
-
-
15,502
Transfers
36,445
5,111
Total governmental activities
10,564,848
12,812,203
14,923,681
16,323,728
17,596,875
Business -type activities:
Investment income
4,586
3,450
12,640
112,841
43,917
Miscellaneous
99,553
42,560
-
-
-
Transfers
(36,445)
(5,111)
Total business -type activities
104,139
46,010
12,640
76,396
38,806
Total primary government
$ 10.668.987
$ 12,85&213
$ 14.936.331
$
16.400.124
$
17.635.681
Change in net assets
Governmental activities
$ (875,118)
$ 1,234,038
$ 2,449,434
$
3,760,756
$
4,515,834
Business -type activities
(52,486)
26,579
63,396
187,441
(68,353)
Total primary government
$ 927,604)
$ 1,260,617
$ 2,512,830
$
3,948,197
$
4,447,481
Basic Financial Statements and Management's Discussion andAnal sis for State and Local Governments.
81
2008 2009 2010 2011 2012
$ 1,839,228 $ 2,239 511 $ 2,679,192 $ 2,403,681 $ 2,520,815
7,154,578 7.095.043 7,304,233 7,232,748 7,892,561
3,996,711 4,083,441 4,594,738 4,733,913 4,652,620
860,448 826.149 806,536 811,177 884,773
3,244,045 3,174,623 2,830,292 2,749,065 2,873,496
120,549 26,702 4,384
17,215,559 17,445,469 18,219.375 17,93Q584 18,824,265
3.268.562 3,308,535 3,398,206 3,691,528 3,536.139
3,268562 3,308,535 3,398,206 3.691,528 3.536.139
$ 20.484.121 $ 20,754,004 $ 21,617,581 $ 21.621112 $ 22.360.404
$ 123,334 $ 122,569 $ 126,968 $ 130,886 $ 135,372
383,325 378,591 465,263 420,653 440,568
288,994 394,082 411,722 400,662 386,974
888,015 699,130 734,718 861,394 816,673
595,558 912,862 1,063,748 1,043,459 1,018,883
W224 105,080 96,670 126,568 149,573
1,602,465 2,017,158 75,845 5,169 5,686
3,969,915 4,629,472 2,974,934 2,988,791 2,953,729
3,616,509 3,404,859 3,227,580 3,571,199 3,582,760
13,609 - - - -
3,630,118 3,404,859 3,227,580 3,571,199 3,582,760
$ 7,600,033 $ 8,034,331 $ 6,202,514 $ 6.559.990 $ 6536,489
$ (13,245,644) $ (12,815,997) $ (15,244,441) $ (14,941,793) $ (15,870,536)
361.556 96324 (170,626) (120,329) 46.621
$ (12,884.088) _L (I _L (I _L (I $ (15.823915)
$ 11,915,355 $ 11,917,359 $ 11,053.128 $ 10,441,869 $ 10,011,748
278,649 267,557 266.077 259,794 263,369
2,018,071 2,239,002 2,261.375 2,198,148 2,164,920
1,212,562 1,256,831 1,204,328 1,191,155 1,178,598
1,227,341 1,116,107 1,114,945 1,140, 744 1,138,097
194.652 (1,346) 280,217 97,743 90,968
55.719 263,459 213,425 30,622 75,413
16,959 6,796
49 296
16,968,604 17,065,765 16,393,495 15,36775 14,923,113
36,431 7,376 14,686 8,493 7,451
- - 55,300
(49 296)
(11865) 7,376 69,986 8,493 7.451
$ 16,955,739 $ 17.073.141 $ 16.463.481 $ 15.368568 $ 14.930.564
$ 3,722,960 $ 4,249,768 $ 1,149,054 $ 418,282 $ (947,423)
348,691 103,700 (100,640) (111,836) 54.072
$ 4,071,651 $ 4,353,468 $ 1,048,414 $ 306,446 $ (893.351)
8 2
General Fund
Resen ed
Unreserved
Total general fluid
All other Governmental Funds
Resen ed
Unreserved, reported in:
Special revenue funds
Capital projects fluids
Total all other governmental fluids
General Fund
Resen ed
Unreserved
Total general fluid
All other Governmental Funds
Resen ed
Unreserved, reported in:
Special revenue funds
Capital projects fluids
Total all other governmental fluids
General Fund
Nonspendable
Restricted
Assigned
Unassigned
Total general fluid
All other Governmental Funds
Restricted
Assigned
Special revenue funds
Capital projects fluids
Total all other governmental fluids
VILLAGE OF NORTH PALM BEACH
FUND BALANCES, GOVERNMENTAL FUNDS
LAST TEN FISCAL YEARS
(_, IO DIFIED- ?CCRU_,,?LB_,,?SISOF- ?CCOUNTING) Unaudited
2003 2004 2005 2006 2007
$
354,396
$
218,882
$
197,163
$ 308,836
$ 945,891
1,654,593
2,883,8»
5,771,684
7,022,606
8,179,659
$
2,008,989
$
3,102,737
$
5,968,847
$ 7,331,442
$ 9,12i,i50
$
613,459
$
470,155
$
19,828
$
$
-
-
-
400,000
224,937
-
-
397,233
673,232
$
613,459
$
470,155
$
19,828
$ 797,233
$ 898,169
2008
2009
$
775,339
$
563,115
8,265,513
10,058,216
$
9,040,852
$ 10,621,331
$
239,979
$
594,399
(152,861)
713,373
825,778
$
1,547,751
$
672,917
2010
2011
2012
$
167,108
$
276,924
$
166,839
338,457
548,489
658,194
104,245
186,594
127,574
10,443,099
10,688,660
11,244,977
$ 11,052,909
$ 11,700,667
$ 12,197,584
47,379
47,107
47,652
844,742
1,491,574
2,129,831
$
892,121
$
1,538,681
$
2,177,483
Basic Financial Statements and Management's Discussion and- ?nalysis for State and Local Governments.
The Village implemented GASB 54, Fund Balance Reporting and Government Fund Definitions, in 2011 and restated the 2010 amounts.
83
VILLAGE OF NORTH PALM BEACH
CHANGES IN FUND BALANCES, GOVERNMENTAL FUNDS
LAST TEN FISCAL YEARS
( VIODIFIEDACCRUAL BASIS OFACCOUNTING) Unaudited
Revenues:
Taxes
Licenses and Permits
Intergovernmental
Charges for services
Fines and forfeitures
Investment earnings
Miscellaneous
Total revenues
Expenditures:
General government
Public safety
Public works
Community development and planning
Leisure services - recreation
Other government
Capital outlay
Debt service
Principal payments
Interest paid on debt
Total expenditures
Excess of revenues over (under) expenditures
Other financing sources (uses)
Transfers in
Transfers out
Capital lease
Proceeds from debt issuance
Miscellaneous
Total other financing sources (uses)
Net change in fund balances
Debt service as a percentage of noncapital
expenditures
Fiscal Year
2003 2004 2005 2006 2007
$ 9,292,822
$ 11,439,823
$ 13,236,952
$ 14,340,682
$ 15,577,511
686,548
712,184
1,131,903
1,128,658
880,266
1,280,228
1,350,104
2,804,985
2,914,057
2,750,021
665,496
719,589
647,915
1,003,660
1,082,569
113,391
122,407
234,513
165,496
132,158
75,023
53,600
196,699
477,421
650,022
139,354
175,431
83,205
130,515
194,716
12,252,862
14,573,138
18,336,172
20,160,489
21,267,263
1,360,072
1,532,561
2,061,545
1,648,131
2,304,654
4,758,982
5,019,361
5,713,904
6,494,578
6,609,801
3,285,603
3,280,274
5,019,739
4,708,196
3,558,264
651,331
735,155
1,216,156
1,256,066
1,376,950
1,682,030
2,430,403
1,298,492
1,186,730
817,293
2,049
2,542,819
581,938
-
1,917,377
2,737,805
939,396
955,184
903,225
879,527
789,048
136,676
40,580
151,233
199,373
207,088
15,538,196
13,852,694
16,043,889
18,182, 592
19,372,218
(3,285,334)
720,444
2,292,283
1,977,897
1,895,045
1,471,529 593,884
(1,471,529) (593,884)
403,000 230,000 123,500
(56)
402,944 230,000 123,500 - -
$ (2,882,390) $ 950,444 $ 2,415,783 $ 1,977,897 $ 1,895,045
9.0300 8.1100 7.0300 7290o 6.4100
84
2008
2009
2010
2011
2012
$ 15,424,638
$ 15,680,749
$ 14,784,906
$ 14,090,966
$ 13,618,635
1,047,144
880,016
910,997
959,098
810,390
2,459,211
3,315,908
1,768,388
1,557,377
1,591,678
1,268,774
1,684,718
1,944,245
1,934,424
1,966,179
235,965
145,340
142,048
164,366
140,610
194,652
(1,345)
280,218
97,743
90,968
137,447
300,455
278,062
59,462
130,293
20,767,831
22,005,841
20,108,864
18,863,436
18,348,753
2,246,461
1,970,257
2,496,342
2,402,241
2,328,568
7,056,833
6,835,730
7,021,231
7,053,282
7,583,018
3,725,450
3,432,556
3,887,034
4,044,642
3,886,698
840,366
784,486
774,121
790,937
844,748
2,876,840
2,898,252
2,361,388
2,295,959
2,374,748
2,597,065
3,939,455
663,582
682,057
495,254
716,206
1,395,735
2,250,000
143,726
43,725
4,384
20,202,947
21,300,196
19,458,082
17,269,118
17,513,034
564,884
705,645
650,782
1,594,318
835,719
1,254,952
454,111
163,490
1,334,934
500,000
(1,254,952)
(454,111)
(163,490)
(1,334,934)
(500,000)
$ 705,645
$ 835,719
$ 564,884
$ 650,782
$ 1,594,318
4.91'o
8.0700
11.9900
85
VILLAGE OF NORTH PALM BEACH
NET ASSESSED VALUE AND ESTIMATED ACTUAL VALUE OF TAXABLE PROPERTY
LAST TEN FISCAL YEARS
Unaudited
Real Property
Fiscal Year
Ended Tax Role Residential Commercial Personal
Sept 30, Year Property Property Property
Total Net Market - Total Direct
Assessed Value Tax Rate
2003
2002
$ 963,091,506
$ 128,216,552
$ 44,276,499
$ 1,135,584,557
5.8000
2004
2003
1,092,433,722
147,927,933
44,914,124
1,285,275,779
6.8000
2005
2004
1,180,028,585
208,240,338
49,767,286
1,438,036,209
7.2700
2006
2005
1,441,249,707
179,827,665
44,422,817
1,665,500,189
6.8000
2007
2006
1,700,678,282
235,776,768
45,084,335
1,981,539,385
6.3000
2008
2007
1,744,202,888
229,300,592
43,735,861
2,017,239,341
6.1000
2009
2008
1,575,367,916
230,599,951
41,471,282
1,847,439,149
6.6980
2010
2009
1,394,954,867
221,443,121
40,552,276
1,656,950,264
6.9000
2011
2010
1,295,097,223
210,844,220
38,261,607
1,544,203,050
6.9723
2012
2011
1,265,549,795
189,284,601
33,303,512
1,488,137,908
6.9723
Note: Assessed values are established by the Palm Beach Property Appraiser's office as of January 1, each year.
Assessments were increased to 100% of market value as of 1980.
Property in the Village is reassessed each year. Property is assessed at actual value, therefore the assessed
values are equal to actual value. Tax rates are per $1,000 of assessed value.
Source: Palm Beach County Property Appraiser
W
VILLAGE OF NORTH PALM BEACH
PROPERTY TAX RATES - DIRECT AND OVERLAPPING GOVERNMENTS
LAST TEN FISCAL YEARS
Unaudited
Note: All millage rates are based on $1 for every $1,000 of assessed value.
Source: North Palm Beach: Notice of Ad Valorem Taxes and Non -Ad Valorem Assessments
(1) Overlapping rates are those of local and county governments that apply to property owners within the Village
of North Palm Beach. Not all overlapping rates apply to all Village of North Palm Beach property owners
(i.e. The rates for special districts apply only to the proportion of the government's property owners whose
property is located within the geographic boundaries of the special district.)
87
Overlapping Rates (1)
Palm Beach
Total
Count,,
Palm
Direct and
Fiscal
Tax Roll
Village of
School
Beach
Special
Overlapping
Year
Year
N. Palm Beach
District
Count,,
Districts
Rates
2003
2002
5.800
8.78
4.808
2.488
21.876
2004
2003
6.800
8.57
4.791
2.556
22.717
2005
2004
7.270
8.43
4.768
2.526
22.994
2006
2005
6.800
8.11
4.719
2.504
22.133
2007
2006
6.300
7.87
4.480
2.325
20.975
2008
2007
6.100
7.36
3.981
2.131
19.572
2009
2008
6.698
7.25
3.966
2.257
20.171
2010
2009
6.900
7.98
4.561
2.493
21.934
2011
2010
6.9723
8.154
4.996
2.5549
22.6772
2012
2011
6.9723
8.1800
4.9925
2.3433
22.4881
Note: All millage rates are based on $1 for every $1,000 of assessed value.
Source: North Palm Beach: Notice of Ad Valorem Taxes and Non -Ad Valorem Assessments
(1) Overlapping rates are those of local and county governments that apply to property owners within the Village
of North Palm Beach. Not all overlapping rates apply to all Village of North Palm Beach property owners
(i.e. The rates for special districts apply only to the proportion of the government's property owners whose
property is located within the geographic boundaries of the special district.)
87
VILLAGE OF NORTH PALM BEACH
PRINCIPAL PROPERTY TAXPAYERS
CURRENT YEAR AND 2003
Unaudited
2012
Percentage
of Total
Village Net
Taxable Taxable Taxable
Assessed Assessed Assessed
Taxpayers
Value
Rank
Value
Value
Olen Residential Realty
$ 16.779214
1
1.13° %0
$ 17.830332
Old Port Cove Equities, Inc
16.815.716
2
1.13° %0
Florida Power & Liaht
14.776.425
3
0.99010
Sanctuary Bay Trust Corporation
13.509.049
4
0.91° %0
13.491211
New Country Motor Cars
10.658.192
5
0.720%0
Crystal Tree NPB
9.939.914
Wolfchase Associates, LLC
8.600.000
Crystal Tree Property Owners
8.500.000
6
0.57 0'0
CF02 Palm Beach III LP
7.000.000
7
0.470,0
Greater Fla Inv CO
5.840.000
Old Port Cove Holdinas, Inc
6.661012
8
0.450%0
Bozzuto, Michael A
6334.818
9
0.430%0
Village Shoppes at US 1. LLC
5.770298
10
0.390%0
2003
Percentage
of Total
Village Net
Taxable
Assessed
Rank Value
1 1.57 °'0
2 1.19 °'0
3 0.88 °'0
4 0.760,0'
5 0.510,0
Transcontinental Atrium, Inc
4.590.000 6
701 US One, Inc
3,600,000 7
Pavilion Office Center
3240.000 8
Old Port Cove Dev.
3.163.597 9
Developers ofNorthlake. Inc
3,143,442 10
Total
$ 106.805.724 7.190o $ 73.438.496
Source: Palm Beach Country Appraiser
Note: Assessed values are established by the Palm Beach Property Appraiser's offices as of January I. each year.
88
0.400,0'
0.32 °'0
0.29 °'0
0.28 °'0
0.28 °'0
6..480,L
VILLAGE OF NORTH PALM BEACH
PROPERTY TAX LEVIES AND COLLECTIONS
LAST TEN CALENDAR YEARS
Unaudited
Collected within
Source: Palm Beach Country Property Appraiser
* Information presented is preliminary due to county software upgrade problems.
89
the Fiscal Year
Total Collections
Fiscal Year
Total Taxes
of the Lew
Collections in
to Date
Ending
Tax Roll
Levied for
Percent
Subsequent
Percent
Sept 30,
Year
Fiscal Year
Amount
of Levy
Years
Amount
of Lew
2003
2002
$ 6,597,909
$ 6,359,478
96.39%
$ 5,522
$ 6,365,000
96.47%
2004
2003
8,825,061
8,441,383
95.65%
10,401
8,451,784
95.77%
2005
2004
10,463,873
10,059,478
96.14%
9,476
10,068,954
96.23%
2006
2005
11,329,648
10,690,869
94.36%
172,744
10,863,613
95.89%
2007
2006
12,624,307
11,802,457
93.49%
228,352
12,030,809
95.30%
2008
2007
12,360,135
11,546,732
93.42%
333,756
11,880.488
96.12%
2009
2008
12,401,519
11,530,384
92.98%
349,642
11,880,026
95.79%
2010
2009
11,564,281
10,683,829
92.39%
284,004
10,967,833
94.84%
2011
2010
10,793,319
10,097,289
93.55%
298,514
10,395,803
96.32%
2012
2011
10,424,715
9,992,145
95.85%
15,616
10,007,761
96.00%
Source: Palm Beach Country Property Appraiser
* Information presented is preliminary due to county software upgrade problems.
89
VILLAGE OF NORTH PALM BEACH
RATIOS OF OUTSTANDING DEBT BY TYPE
LAST TEN FISCAL YEARS
Unaudited
* 2010 Median Household Income was used for calculation - 2011 Income was not available due to agency software upgrades
** 2010 Population was used for calculation - 2011's Population was not available due to agency software upgrades
(1) See the Schedule of Demographic and Economic Statistics on page 93 for personal income and population data.
N/A Data not available.
90
Business -type
Governmental Activities
Activities
Fiscal Year
Percent of
Ended
Loans
Capital
Loans
Capital
Median Personal
Per
Sept 30,
Pavable
Leases
Pavable
Leases
Total
Income (1)
Capita 1
2003
$ 6,947,633 $
587,792
$ 513,472
$
$ 8,048,897
N/A
$ 660
2004
6,376,387
433,855
411,573
7,221,815
N/A
592.05
2005
5,754,677
275,840
454,131
6,484,648
N/A
513.31
2006
4,941,765
209,224
5,185,978
10,336,967
17.20%
786.20
2007
4,280,842
81,100
5,026,895
9,388,837
14.670o
715.61
2008
3,605,639
40,097
4,662,833
192,892
8,501,461
12.920o
692.64
2009
2,250,000
4,383,033
97,049
6,730,082
10.14° o
583.15
2010
4,090,284
235,176
4,325,460
6.74 °o
371.64
2011
3,844,928
173,084
4,018,012
*6.260 o
**345.22
2012
3,608,294
106,933
3,715,227
5.980o
303.51
Note:
Details regarding the Village's outstanding
debt may be found in the notes to the
financial statements.
* 2010 Median Household Income was used for calculation - 2011 Income was not available due to agency software upgrades
** 2010 Population was used for calculation - 2011's Population was not available due to agency software upgrades
(1) See the Schedule of Demographic and Economic Statistics on page 93 for personal income and population data.
N/A Data not available.
90
VILLAGE OF NORTH PALM BEACH
DIRECT AND OVERLAPPING GOVERNMENTAL ACTIVITIES DEBT
SEPTEMBER 30, 2012
Unaudited
Debt repaid with property taxes:
Palm Beach County
Palm Beach County School Board
Other debt:
Palm Beach County
Palm Beach County School Board
Subtotal, overlapping debt
Village of North Palm Beach Direct Debt
Total direct and overlapping debt
Sources: Palm Beach County Tax Appraiser's Office
Palm Beach County School Board
Palm Beach County Clerk & Comptroller
12,624,637
100% -
$ 12,624,637
Note: Overlapping governments are those that coincide, at least in part, with the geographic boundaries
of the Village. This schedule estimates the portion of the outstanding debt of those overlapping
governments that is borne by the residents and businesses of the Village of North Palm Beach. This
process recognizes that, when considering the Village's ability to issue and repay long -term debt, the
entire debt burden borne by the residents and businesses should be taken into account. However,
this does not imply that every taxpayer is a resident, and therefore responsible for repaying the debt,
of each overlapping government.
(1) For debt repaid with property taxes, the percentage of overlapping debt applicable is estimated using
taxable assessed property values. Value that is within the Village's boundaries and dividing it by the
County's and School Board's total taxable assessed value. This approach was also used for the other
debt.
91
Percentage
Amount
Net
Applicable to
Applicable to
Debt
the Village of
the Village of
Outstanding
North Palm Beach (1)
North Palm Beach
$ 207,340,000
1.20%
$ 2,488,080
1.13%
815,851,000
1.20%
9,790,212
30,650,000
1.13%
346,345
12,624,637
100% -
$ 12,624,637
Note: Overlapping governments are those that coincide, at least in part, with the geographic boundaries
of the Village. This schedule estimates the portion of the outstanding debt of those overlapping
governments that is borne by the residents and businesses of the Village of North Palm Beach. This
process recognizes that, when considering the Village's ability to issue and repay long -term debt, the
entire debt burden borne by the residents and businesses should be taken into account. However,
this does not imply that every taxpayer is a resident, and therefore responsible for repaying the debt,
of each overlapping government.
(1) For debt repaid with property taxes, the percentage of overlapping debt applicable is estimated using
taxable assessed property values. Value that is within the Village's boundaries and dividing it by the
County's and School Board's total taxable assessed value. This approach was also used for the other
debt.
91
Fiscal
Year
(4)
2006
2007
2008
2009
2010
2011
2012
VILLAGE OF NORTH PALM BEACH
Pledged - Revenue Coverage
Country Club Bonds
Last Ten Fiscal Years
Unaudited
Gross Operating
Revenues (1) Expenses (2) Net Revenue
Required
Debt
Service
Coverage (3)
$ 2,348,813
$ 1,910,640
$ 438,173
$ 106,936
4.10
3,507,441
2,991,621
515,820
392,505
1.31
3,652,940
2,558,591
1,094,349
394,900
2.77
3,412,235
2,587,171
825,064
394,900
2.09
3,242,266
2,728,470
513,796
394,900
1.30
3,579,692
3,049,301
530,391
394,900
1.34
3,590,211
2,932,743
657,468
394,900
1.66
(1) Gross revenue includes interest revenue.
(2) Operating expenses excludes depreciation.
(3) Coverage should be not less than 1.00.
(4) 2006 was the first year the debt was outstanding, and was not a complete year.
92
(4)
Calendar
Year
2003
2004
2005
2006 (estimate)
2007 (estimate)
2008 (estimate)
2009 (estimate)
2010 (estimate)
2011 (estimate)
2012 (estimate)
Sources:
Note
VILLAGE OF NORTH PALM BEACH
DEMOGRAPHIC AND ECONOMIC STATISTICS
LAST TEN CALENDAR YEARS
Unaudited
Business Development Board
US Census Bureau
* 2011 Demographic data is not available due to Agency Software upgrade
that is not complete
(1) All information available at the current time is presented.
(2) North Palm Beach is not large enough to track unemployment rates.
Palm Beach Count-,, rates are presented.
9J
Per
Palm Beach
Median
Capita
Count-,,,
Personal
Personal
Unemployment
Population (1)
Income (1)
Income (1)
Rate (2)
12,198
-
-
5.6
12,198
-
-
5.0
12,633
-
-
4.0
13,148
60,101
46,726
3.3
13,120
63,984
42,224
4.1
12,274
65,815
45,563
6.3
11,541
66,401
49,350
10.8
11,639
64,156
49,130
12.0
*
*
*
10.7
12,241
62,121
49,117
* *5.29
Business Development Board
US Census Bureau
* 2011 Demographic data is not available due to Agency Software upgrade
that is not complete
(1) All information available at the current time is presented.
(2) North Palm Beach is not large enough to track unemployment rates.
Palm Beach Count-,, rates are presented.
9J
VILLAGE OF NORTH PALM BEACH
PRINCIPAL EMPLOYERS
CURRENT YEAR AND NINE YEARS AGO
Unaudited
Source: Business Development Board of Palm Beach County
Employer: Palm Beach County
Information is not available for the Village of North Palm Beach.
* * Percentage of total employment is calculated using Palm Beach County's
available labor force in each of the respective years presented.
Notes:
(1) Formerly Columbia Palm Beach Health Care Systems, Inc
(2) Intracoastal Health Systems, Inc - now part of Tenet Healthcare Corp
94
2012 * **
2003
Percentage
Percentage
of Total
of Total
Employer
Employees
Employment
Employees
Employment
Palm Beach Country School Board
21,495
3.47%
18,677
3.19%
Palm Beach County Government
11,381
1.84%
9,000
1.54%
Tenet Health Care Corp (2)
6,100
0.98%
3,040
0.52%
NextEra Energy (Florida Power & Light)
3,635
0.59%
2,800
0.48%
G4S (Wachenhut Corp)
3,000
0.48%
-
Hospital Corporation of America (FICA) (1)
2,714
0.44%
4,000
0.68%
Florida Alantic University
2,706
0.44%
-
Bethesda Memorial Hospital
2,391
0.39%
1,800
0.31%
Office Depot
2,250
0.36%
-
Boca Raton Regional Hospital
2,250
0.36%
-
Boca Raton Resort & Club
2,380
0.41%
U.S. Sugar Corporation
2,200
0.38%
Florida Crystals
2,000
0.34%
The Breakers Hotel
1,800
0.31%
Total
57,922
9.35%
47,697
8.15%
Source: Business Development Board of Palm Beach County
Employer: Palm Beach County
Information is not available for the Village of North Palm Beach.
* * Percentage of total employment is calculated using Palm Beach County's
available labor force in each of the respective years presented.
Notes:
(1) Formerly Columbia Palm Beach Health Care Systems, Inc
(2) Intracoastal Health Systems, Inc - now part of Tenet Healthcare Corp
94
VILLAGE OF NORTH PALM BEACH
Full -Time
Equivalent
Village Government
Employees by Function
LAST TEN FISCAL
YEARS ( *)
Unaudited
2003
2004
2005
2006
2007
2008
2009
2010
2011
2012
Number of Employees:
General Government
Village Manager - Full -Time
1
1
1
1
1
1
1
1
1
1
Assistant Village Manager - Full -Time
1
1
1
0
0
0
0
0
0
0
Systems Specialist
Full -Time
1
1
1
2
2
2
2
2
2
3
Part -Time
0
0
0
0
0
0
1
1
1
0
Executive Secretary_ - Full -Time
1
1
1
1
1
1
1
1
1
1
Human Resources
2
2
2
2
2
2
2
Village Clerk - Full -Time
3
3
3
3
3
3
3
3
3
3
Finance
Full -time
5
5
5
5
5
5
5
5
5
5
Part -Time
0
0
0
0
0
1
1
1
1
1
Public Works
Full -time
61
61
62
54
47
48
38
37
37
37
Part -Time
8
8
6
3
0
0
0
0
0
0
Public Safety
Full -time
66
66
61
66
68
68
67
67
67
0
Part -Time
14
14
15
14
13
12
11
12
12
0
Law Enforcement
Full -time
0
0
0
0
0
0
0
0
0
43
Part -Time
0
0
0
0
0
0
0
0
0
12
Fire Rescue
Full -time
0
0
0
0
0
0
0
0
0
24
Part -Time
0
0
0
0
0
0
0
0
0
0
Community Development and Planning
Full -time
0
0
0
0
9
10
9
9
9
8
Part -Time
0
0
0
0
1
1
2
2
2
2
Leisure Services
Library
Full -time
9
9
8
7
7
7
6
6
6
6
Part -Time
7
7
7
8
8
8
10
10
10
10
Recreation
Full -time
6
6
5
15
15
17
9
7
6
6
Part -Time
14
14
15
31
39
42
42
42
43
43
Other Government - Country_ Club
Full -time
25
25
24
18
19
18
5
5
7
5
Part -Time
27
27
27
24
25
22
21
21
64
56
Total Number of Employees Budgeted FY Ending
249
249
242
254
265
268
236
234
279
268
* Variance exists due to the employment of seasonal and
part
-time employees.
Source: Village of North Patin Beach Budget Report
95
VILLAGE OF NORTH PALM BEACH
OPERATING INDICATORS BY FUNCTION/PROGRAM
LAST TEN FISCAL YEARS
Unaudited
OTHER GOVERNMENT
Country Club
Number of Golf Members
Number of Tennis Members
(1) An accurate number of building permits issued for 2006 is not available - computer systems crash.
Source: Village of North Palrn Beach
U.S. Census Bureau
01
365 579 389 297 354 298 283
136 171 171 180 184 173 162
2003
2004
2005
2006
2007
2008
2009
2010
2011
2012
FUNCTION/PROGRAM
GENERAL GOVERNMENT
Number of Parcels
-
-
-
-
7,411
7,422
7,472
7,466
7,466
7,473
PUBLIC WORKS
Street Maintenance (No. of lane miles maintained)
31.155
31.155
31.155
31.155
31
31
31
31
31
31
Sanitation (Tons of Refuse Collected)
13,136
18,842
14,037
13,203
12,085
11,974
10,667
10,165
9,962
10,065
No. of collection units for solid waste (residential)
7,434
7,470
7,519
7,558
7,152
7,163
7,214
7,070
7,071
7,076
Number of vehicles maintained
95
95
95
95
104
104
110
110
98
98
Number of repair overlays completed (miles)
3.787
5.587
2.462
2.935
2
3
2.5
2.71
-
-
PUBLIC SAFETY
Number of arrests by police officers
320
315
331
410
545
549
448
402
260
211
Number of traffic citations issued
2,564
3,110
5,743
4,272
4,269
5,520
6,305
4,951
2,564
2,566
EMS average response tines (minutes)
2.94
4.42
3.98
4.69
4.73
5.17
5.01
5.12
5.19
5.26
Number of EMS calls
922
1,066
965
1,056
1,034
1,114
1,214
1,146
1,179
1,326
COMMUNITY DEVELOPMENT & PLANNING
Building Department- Number of Permits
224
201
201
(1)
1,875
1,619
1,548
1,744
1,616
1,835
Number of code enforcement violations
-
-
-
1,767
1,617
729
613
391
575
817
Number of code violations brought to board/magistrate
(Calendar Yr End)
120
145
165
144
126
115
73
38
72
100
RECREATION
Number of community events presented
14
15
22
21
24
23
28
28
38
49
Number of registrants in athletic programs
1,750
1,575
1,400
1,520
1,600
1,400
1,125
1,005
1,260
1,311
LIBRARY
Library - Number of Volumes
47,960
47,531
54,074
47,371
42,372
33,122
35,681
39,277
40,658
43,340
OTHER GOVERNMENT
Country Club
Number of Golf Members
Number of Tennis Members
(1) An accurate number of building permits issued for 2006 is not available - computer systems crash.
Source: Village of North Palrn Beach
U.S. Census Bureau
01
365 579 389 297 354 298 283
136 171 171 180 184 173 162
VILLAGE OF NORTH PALM BEACH
CAPITAL ASSET STATISTICS BY FUNCTION/PROGRAAI
LAST TEN FISCAL YEARS
Unaudited
97
2003
2004
2005
2006
2007
2008
2009
2010
2011
2012
Function Program:
General Government
No. of General Government Buildings
11
11
11
11
11
11
23
23
23
23
Public Works
Square Miles
5.18
5.18
5.18
5.18
5.18
5.18
5.18
5.18
5.18
5.18
Miles of Streets
36.00
36.00
36.00
36.00
36.00
36.00
36.00
36.00
36.00
36.00
Number of Street Lights
425
425
425
425
425
513
513
513
513
513
Public Safety
Fire:
Number of Stations
1
1
1
1
1
1
1
1
1
1
Number of Fireman & Officers
8
8
8
0
0
0
0
0
0
0
Number of Firemen Paramedics, EX11's
0
0
0
23
23
23
23
23
23
22
Police; EMS Protection:
0
0
0
0
0
0
0
0
0
1
Number of Stations
Number of Policemen & Officers
1
1
1
1
1
1
1
1
1
1
EMS Protection
35
35
35
33
32
32
31
31
31
28
0
0
0
0
0
0
0
0
0
2
Leisure Services
13
13
13
0
0
0
0
0
0
0
Recreation
Number of Parks
Public Tennis Courts
Swimming Pool
4
4
4
4
4
4
4
4
4
4
Number of Marinas
4
4
4
2
2
2
2
2
2
2
Library
1
1
1
1
1
1
1
1
1
1
Number of Libraries
1
1
1
1
1
1
1
1
1
1
Number of Volumes
1
1
1
1
1
1
1
1
1
1
47,960
47,531
54,074
47,371
42,372
33,122
35,681
39,277
40,658
43,340
Other Government
Country Club
Golf Course
Driving Range
Tennis Courts
1
1
1
1
1
1
1
1
1
1
Restaurant/ Snack Bar
1
1
1
1
1
1
1
1
1
1
10
10
10
10
10
10
10
10
10
10
0
0
0
0
0
0
0
1
1
1
Source: Village of North Palm Beach
0
0
0
0
0
0
0
1
1
1
97
OTHER REPORTS
NOWLEN., HOLT & MINER, P.A.
CERTMECD PUBLIC ACCO NTr' NTTS
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515 ti 1.1, %G1 I N I1121's I• , ,117 17M
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'554 k5.�11'�'a 1'4i'I'�kl
REPORT ON INTERNAL CONTROL OVER
FINANCIAL REPORTING AND ON COMPLIANCE
AND OTHER MATTERS BASED ON AN
AUDIT OF FINANCIAL STATEMENTS
PERFORMED IN ACCORDANCE WITH
GO VERNMENT A UDITING STANDARDS
The Honorable Mayor and Members of the Village Council
North Palm Beach, Florida
EVEFETT 3. WN&EN 1I KC-i DMI• rN
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GCLLE G JADE. nerd DA J24-h -LOA)
TELE'HONE ?5471 M -5312
FAX x;,501) 910 G74.9
We have audited the financial statements of the governmental activities, the business -type
activities, each major fund, and the aggregate remaining fund information of the Village of North
Palm Beach, Florida, as of and for the year ended September 30, 2012, which collectively
comprise the Village of North Palm Beach, Florida's basic financial statements and have issued
our report thereon dated March 19, 2013. We conducted our audit in accordance with U.S.
generally accepted auditing standards and the standards applicable to financial audits contained in
Government Auditing Standards, issued by the Comptroller General of the United States.
Internal Control Over Financial Reporting
Management of the Village of North Palm Beach, Florida, is responsible for establishing and
maintaining effective internal control over financial reporting. In planning and performing our
audit, we considered the Village of North Palm Beach, Florida's internal control over financial
reporting as a basis for designing our auditing procedures for the purpose of expressing our
opinions on the financial statements, but not for the purpose of expressing an opinion on the
effectiveness of the Village of North Palm Beach, Florida's internal control over financial
reporting. Accordingly, we do not express an opinion on the effectiveness of the Village of North
Palm Beach, Florida's internal control over financial reporting.
A deficiency in internal control exists when the design or operation of a control does not allow
management or employees, in the normal course of performing their assigned functions, to
prevent, or detect and correct misstatements on a timely basis. A material weakness is a
deficiency, or a combination of deficiencies, in internal control such that there is a reasonable
possibility that a material misstatement of the entity's financial statements will not be prevented,
or detected and corrected on a timely basis.
AMERICM 1NSMUTE OF CEFMFIED FJBLICA OUNITANTS • FLORCA INSTIT "JI L 03 LH"I IF; LL) PUBLIC ACCOUN IANIS • Cf21APALF11CA IN I LHNAK ICNAL
Our consideration of internal control over financial reporting was for the limited purpose
described in the first paragraph of this section and was not designed to identify all deficiencies in
internal control over financial reporting that might be deficiencies, significant deficiencies, or
material weaknesses. We did not identify any deficiencies in internal control over financial
reporting that we consider to be material weaknesses, as defined above.
Compliance and Other Matters
As part of obtaining reasonable assurance about whether Village of North Palm Beach, Florida's
financial statements are free of material misstatement, we performed tests of its compliance with
certain provisions of laws, regulations, contracts, and grant agreements, noncompliance with
which could have a direct and material effect on the determination of financial statement
amounts. However, providing an opinion on compliance with those provisions was not an
objective of our audit, and accordingly, we do not express such an opinion. The results of our
tests disclosed no instances of noncompliance or other matters that are required to be reported
under Government Auditing Standards.
We noted certain matters that we reported to the management of the Village of North Palm Beach,
Florida in the attached Management Letter dated March 19, 2013.
This report is intended solely for the information and use of management, the audit committee,
Village Council, and federal and state awarding agencies and pass - through entities and is not
intended to be and should not be used by anyone other than these specified parties.
March 19, 2013
West Palm Beach, Florida
99
NOWLEN., HOLT & MINER, P.A.
CERTIMECD PUBLIC AcCO NTr' NTTS
M- w I 11'.."A _S .•u li 01 - CE'i
!.I }y ° ?i w111: il.[ I.xIKL
515 ti 1.1, %G1 I N III21'4I• , ,117 17M
M I° "i PNI.�I N v 11 I L:}klll }::n'•17147
k5,�
MANAGEMENT LETTER IN ACCORDANCE WITH
THE RULES OF THE AUDITOR GENERAL
OF THE STATE OF FLORIDA
The Honorable Mayor and Members of the Village Council
Village of North Palm Beach, Florida
EVEFETT 3. WN&EN JIKC -iDMI. rN
EEWJAAD T. +7_T. '—P6 WLLM 2. WINE?. CN
F.CBEF.T 0. ° ENC FI% J =,. {:rx,
AIMFT R RAFI::FVZH. CN
TERRY'. MDR -i}y J =. CN
h FF%�,,TT. CFA
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333 5.1.'eriv. STREET
Fi }g OFFI{:F �Ix 3%%i
GCLLE G JADE. rl oni DA J24-h -LOA)
TELE'HONE ?5471 M -5372
FAX x;,501) 910 G74.9
We have audited the financial statements of the Village of North Palm Beach, Florida, as of and for
the fiscal year ended September 30, 2012, and have issued our report thereon dated March 19,
2013.
We conducted our audit in accordance with U.S. generally accepted auditing standards, the
standards applicable to financial audits contained in Government Auditing Standards issued by the
Comptroller General of the United States, and Chapter 10.550, Rules of the Florida Auditor
General. We have issued our Independent Auditor's Report on Internal Control over Financial
Reporting and on Compliance and Other Matters Based on an Audit of Financial Statements
Performed in Accordance with Government Auditing Standards. Disclosures in that report, which
is dated March 19, 2013, should be considered in conjunction with this management letter.
Additionally, our audit was conducted in accordance with Chapter 10.550, Rules of the Auditor
General, which governs the conduct of local governmental entity audits performed in the State of
Florida. This letter includes the following information, which is not included in the
aforementioned auditor's reports.
PRIOR YEAR COMMENTS
The Rules of the Auditor General require that we address in the management letter whether or not
recommendations made in the preceding annual financial audit report have been followed. All
prior year recommendations have been implemented.
CURRENT YEAR COMMENTS
The Rules of the Auditor General require that we address in the management letter any
recommendations to improve financial management. In connection with our audit for the fiscal
year ended September 30, 2012, we did not have any such recommendations.
100
AMEJIi ICAN INSTITUTE OF CERTIFIED PIUBLIC AC C,0UNTANTS b FLCH ICDA INS I I � JI L O3 CLH'I IF LL) PUBLIC ACCC'UN I-ANIS • CPAPAEFIICA IN I LHNAK ICNAL
Investment ofPublic Funds
Rules of the Auditor General require our audit to include a review of the Village's
compliance with Section 218.415, Florida Statutes, regarding the investment of public
funds. In connection with our audit for the fiscal year ended September 30, 2012, the
results of our procedures did not disclose any instances of noncompliance with Section
218.415, Florida Statutes.
Violations of Contracts and Grant Provisions or Abuse
Rules of the Auditor General require that we address violations of provisions of contracts
or grant agreements, fraud, illegal acts, or abuse that have occurred, or are likely to have
occurred, that have an effect on the financial statements that is less than material but more
than inconsequential. In connection with our audit for the fiscal year ended September 30,
2012, we did not have any such findings.
Matters Inconsequential to the Financial Statements
Rules of the Auditor General provide that the auditor may, based on professional judgment,
report the following matters that have an inconsequential effect on the financial statements,
considering both quantitative and qualitative factors: (1) violations provisions of contracts
or grant agreements, fraud, illegal acts, or abuse; and (2) deficiencies in internal control that
are not significant deficiencies. In connection with our audit for the fiscal year ended
September 30, 2012, we did not have any such findings.
Oversight Unit and Component Units
The Village of North Palm Beach, Florida, is a municipal corporation incorporated in 1956
pursuant to Chapter 31481, Laws of Florida, Extraordinary Session 1956. Based upon the
application of criteria defined in publications cited in Chapter 10.553, Rules of the Auditor
General, the Village has determined that there are no component units related to the Village.
Consideration of Financial Emefgency Criteria
Rules of the Auditor General require a statement be included as to whether or not the local
government entity has met one or more of the conditions described in Section 218.503(1),
Florida Statutes, and identification of the specific condition(s) met. In connection with our
audit, the results of our procedures did not disclose that the Village of North Palm Beach,
Florida has met any of the conditions described in Section 218.503(1) during the fiscal year
ended September 30, 2012.
Annual Financial Report
Rules of the Auditor General require that we determine whether the annual financial report
for the Village of North Palm Beach, Florida for the fiscal year ended September 30, 2012,
filed with the Florida Department of Financial Services pursuant to Section 218.32(1)(a),
Florida Statutes, is in agreement with the annual financial audit report for the fiscal year
ended September 30, 2012. In connection with our audit, we noted that the two reports
were in substantial agreement.
101
Financial Condition Assessment Procedures
Pursuant to Rules of the Auditor General, we applied financial condition assessment
procedures as of September 30, 2012. It is management's responsibility to monitor the
Village's financial condition, and our financial condition assessment was based in part on
representations made by management and the review of financial information provide by
management. The results of our procedures did not disclose any matters that are required
to be reported.
Excess of Expenditures Over Appropriations
There were no departments that had expenditures in excess of appropriations.
Our management letter is intended solely for the information and use of the Legislative Auditing
Committee, members of the Florida Senate and the Florida House of Representatives, the Florida
Auditor General, management, the audit committee, Village Council, and federal and state
awarding agencies and pass - through, and is not intended to be and should not be used by anyone
other than these specified parties.
March 19, 2013
West Palm Beach, Florida
% Axt. ga 2 4 m6xx, PQ,
102