FY 2017 CAFR
The Village of
North Palm Beach, Florida
COMPREHENSIVE ANNUAL FINANCIAL REPORT
Fiscal Year Ended September 30, 2017
Prepared by:
Finance Department
Samia Janjua
Director of Finance
THE VILLAGE OF NORTH PALM BEACH, FLORIDA
FINANCIAL STATEMENTS
SEPTEMBER 30, 2017
TABLE OF CONTENTS
INTRODUCTORY SECTION
Letter of Transmittal ..................................................................................................................................... i
Principal Village Officials ....................................................................................................................... viii
Organizational Structure .............................................................................................................................. ix
GFOA Certificate of Achievement for Excellence in Financial Reporting .................................................. x
FINANCIAL SECTION
Independent Auditors' Report ....................................................................................................................... 1
Management's Discussion and Analysis ....................................................................................................... 4
BASIC FINANCIAL STATEMENTS:
Government-wide Financial Statements:
Statement of Net Position ..................................................................................................................... 14
Statement of Activities ......................................................................................................................... 15
Fund Financial Statements:
Balance Sheet - Governmental Funds .................................................................................................. 17
Reconciliation of the Balance Sheet – Governmental Funds
to the Statement of Net Position ..................................................................................................... 18
Statement of Revenues, Expenditures and Changes in
Fund Balances - Governmental Funds ........................................................................................... 19
Reconciliation of the Statement of Revenues, Expenditures, and Changes in
Fund Balances of the Governmental Funds to the Statement of Activities .................................... 20
Statement of Net Position - Proprietary Fund ...................................................................................... 21
Statement of Revenues, Expenses, and Changes in Net
Position - Proprietary Fund ............................................................................................................ 22
Statement of Cash Flows - Proprietary Fund ....................................................................................... 23
Statement of Fiduciary Net Position - Fiduciary Funds ....................................................................... 24
Statement of Changes in Fiduciary Net Position – Fiduciary Funds .................................................... 25
Notes to the Basic Financial Statements ..................................................................................................... 26
REQUIRED SUPPLEMENTARY INFORMATION:
Schedule of Funding Progress – Other Postemployment Benefits ........................................................ 74
Schedule of Changes in Net Pension Liability – General Employees Retirement Fund ....................... 75
Schedule of Changes in Net Pension Liability – Fire and Police Retirement Fund .............................. 76
Schedules Contributions and Investment Returns – Retirement Funds ............................................... 77
Notes to the Schedule of Contributions ................................................................................................ 78
Schedule of Revenues, Expenditures, and Changes in Fund Balance -
Budget and Actual - General Fund ................................................................................................. 79
Notes to the Budgetary Required Supplementary Information ............................................................ 80
THE VILLAGE OF NORTH PALM BEACH, FLORIDA
FINANCIAL STATEMENTS
SEPTEMBER 30, 2017
TABLE OF CONTENTS
(Continued)
OTHER SUPPLEMENTARY INFORMATION:
Schedule of Departmental Expenditures– Budget and Actual – General Fund .................................... 81
Combining Balance Sheet – Nonmajor Governmental Funds .............................................................. 84
Combining Statement of Revenues, Expenditures, and Changes in Fund Balances -
Nonmajor Governmental Funds ........................................................................................................ 85
Combining Statement of Net Position – Pension Trust Funds .............................................................. 86
Combining Statement of Changes in Fiduciary Net Position – Pension Trust Funds ........................... 87
Combining Statement of Agency Net Position .................................................................................... 88
Combining Schedule of Changes in Agency Net Position .................................................................... 89
Schedule of Revenues and Departmental Expenses –
Budget and Actual – Country Club Fund – Budgetary Basis ............................................................ 90
STATISTICAL SECTION
Net Position by Component ................................................................................................................. 91
Changes in Net Position ....................................................................................................................... 91
Fund Balances, Governmental Funds ................................................................................................... 94
Changes in Fund Balances, Governmental Funds ................................................................................ 95
Net Assessed Value and Estimated Actual Value of Taxable Property ............................................... 97
Property Tax Rates - Direct and Overlapping Governments................................................................. 98
Principal Property Taxpayers ............................................................................................................... 99
Property Tax Levies and Collections ................................................................................................... 99
Ratios of Outstanding Debt by Type ................................................................................................... 101
Direct and Overlapping Governmental Activities Debt ...................................................................... 102
Pledged-Revenue Coverage ................................................................................................................ 103
Demographic and Economic Statistics ................................................................................................ 104
Principal Employers ........................................................................................................................... 105
Full-Time Equivalent Village Government Employees by Function .................................................. 106
Operating Indicators by Function/Program ........................................................................................ 107
Capital Asset Statistics by Function/Program ..................................................................................... 108
OTHER 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 ................................ 109
Management Letter in Accordance with the Rules of the Auditor General of the
State of Florida ............................................................................................................................... 111
Independent Accountant’s Report on Compliance with
Section 218.415, Florida Statutes .................................................................................................... 114
INTRODUCTORY SECTION
THE VILLAGE OF
NORTH PALM BEACH
“THE BEST PLACE TO LIVE UNDER THE SUN”
501 U.S. Highway 1, North Palm Beach, FL 33408-4902 * (561) 841-3380 * Fax (561) 848-3344
March 22, 2018
The Honorable Mayor, Members of the Village Council and Residents
Village of North Palm Beach, Florida
The Finance Department and Village Manager's Office are pleased to submit the Comprehensive Annual
Financial Report (CAFR) for the Village of North Palm Beach, Florida for the fiscal year ended September
30, 2017.
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 unmodified (“clean”) opinion on
the Village of North Palm Beach’s financial statements for the year ended September 30, 2017. 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. The 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 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;
• determining compliance with finance-related laws, rules and regulations; and
• evaluating the efficiency and effectiveness of Village operations.
ii
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 is known for its
abundance of waterfront property (lakes, canals, and the Atlantic Ocean) as well as other assets: Country
Club with a golf course, driving range, pool, and tennis courts; four parks; marina; library; police and fire
rescue stations; and a public elementary school.
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 Generally Accepted Accounting Principles (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 which 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).
iii
The level of budgetary control (that is, the level at which expenditures cannot legally exceed the
appropriated amount) is established at the fund level. The Village maintains an encumbrance accounting
system as one technique of accomplishing budgetary control. All expenditures, other than personal
services, are controlled by a procurement system which encumbers purchase orders against the budget
prior to issuance to vendors. All appropriations lapse at year end; however, encumbrances specifically
designated to be carried over to the subsequent year are re-appropriated in the following year.
ECONOMIC OUTLOOK
Property Values
The Village obtains a major portion of its annual General Fund financial resources (58%) 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 market trends in 2013 as well as in early 2014, it appears that there is new growth in
our community. Both the State and South Florida, in particular, are enjoying resurgence in real estate
activity, which has translated into annual gains in market prices for area homes.
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 to provide 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 have 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. The
Village, with the assistance of the Village’s Audit Committee, 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, along
with the Village’s Investment Advisor, continue to explore other investment opportunities that 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 have had a very positive financial impact on both plans. 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 2018, the Village introduced a high deductible insurance plan along
with funding health saving accounts, is exploring the use of contractual health clinic services for its
employees and will continue its focus on Employee Wellness as a measure to help control health care
costs and improve our opportunity for additional savings from our providers.
iv
The impact of personnel salaries and benefits in the coming years will have a broad and continuing effect
on future Village financing and service priorities in the areas of staffing, public services, and public
projects. Approximately 64% of the annual budget is allotted for wages and fringe benefits.
INITIATIVES AND FUTURE PROJECTS
The FY2017/2018 budget reflects a renewed commitment and predictable funding for community
infrastructure in areas such as roadways, neighborhood sidewalks, lighting, public buildings, and park
facilities. The use of revenue from a County-wide sales surtax is facilitating the Village’s ability to develop
a financially feasible capital program.
The Community Development Department provides Planning and Zoning, Code Compliance and
Building services. The Department processed over 2,000 permits in FY 2017 including building permits,
special events, zoning verification letters, right-of-way and zoning applications. Staff also performed in
excess of 8,400 building and code compliance inspections. The Department continues to strive to
improve its level of services for plan reviews, building inspections, code enforcement and zoning
compliance. The Department will move ahead with the conversion of paper records to electronic records
storage, resulting in a significant savings of staff’s time and effort in records retrieval.
Upon completion of a design charrette process in which North Palm Beach residents described their
vision for the community’s future, the Village adopted the resulting Master Plan in 2016 that described
the desired character of future development and redevelopment. Having in place a viable Master Plan,
as well as a clear definition of the highest and best use of properties on U.S. 1 and Northlake Boulevard,
will encourage developers to invest in the community creating an enhanced sense of place and
culminating in increased Village revenues. Staff will proceed in actively implementing the Master Plan
strategies as well as undertaking additional planning initiatives to include the Evaluation and Appraisal
Report for the Comprehensive Plan.
The Parks and Recreation Department continues to offer programs for all age groups at each of its six
(6) facilities. Anchorage Park will host diverse events in the upcoming year to include: movies in the park,
food truck nights, 5K races, organized volleyball leagues, the Village’s annual fishing tournament, and
Heritage Day. The North Palm Beach Country Club Pool and Tennis facilities plan to offer a wide variety
of leagues, training opportunities and tournaments as well as the July 4th fireworks program. In addition,
the Department will provide youth sports training and leagues in baseball, soccer, flag football, volleyball,
lacrosse and basketball. The Department will continue to sponsor bus trips throughout the year, ranging
from local day activities to weekend excursions to Key West.
The Public Works Department is tasked with the oversight and management of Village sanitation,
infrastructure, streets, parks, buildings, equipment, and the roadways. This Department’s current focus
is on enhancing infrastructure maintenance standards and meeting the community’s expectation
regarding the appearance of public spaces during the coming year. Department staff will also be
analyzing all critical infrastructure needs throughout the community and in our facilities to determine
future project priorities and identify opportunities to improve performance through the use of best
maintenance practices. Public Works will address currently identified infrastructure projects such as
drainage improvements, road maintenance, and park improvements in the ten (10) year Capital
Improvement Plan (CIP). Finally, Public Works is completing a year-long project to convert its sanitation
vehicles from rear-loading to front loader capability, which is expected to improve overall efficiency and
decrease the number of Workers’ Compensation claims.
v
The Police Department has focused on improvements in community policing/neighborhood outreach by
conducting community meetings and high visibility directed patrols that incorporate a high rate of officer
interaction with Village residents. The Department continues to emphasize the importance of reducing
crime in the Village through the use of advanced technology to analyze crime trends and deter future
crime using predictive policing concept, additional crime suppression and community engagement efforts
through the use of Transitional Neighborhood Teams and the newly created, interdepartmental
Neighborhood Enhancement Team (NET). Two new full-time officers were funded in the FY 2018 budget
in order to create this program, which allows officers and other members of the NET team to concentrate
their efforts in neighborhoods requiring assistance in achieving their quality of life goals. The Department
continues to benchmark itself against the best policing practices by participating in the CALEA
(Commission on Accreditation for Law Enforcement Agencies) accreditation process. The Department
was re-accredited in July, 2017. The Police Department budget includes funding for the
purchase/replacement of needed marked patrol vehicles and unmarked detective vehicles.
The Police Department was ranked #10 of Florida Safest Cities by the National Council for Home Safety
and Security due to a decrease in overall crime as well as an increase in our clearance rate. The Police
Department will seek available Body Worn Camera grant opportunities and participate in a partnership
with The State Attorney’s Office on the Sober Homes Taskforce. Also, the Department will remain
involved in the BVP (Ballistic Vest Program) and FDOT (Florida Department of Transportation) grant
opportunities and will seek to improve and enhance its weapons and tactical training programs for all
sworn law enforcement officers.
Fire Rescue has experienced an annual increase in calls for service since 2011 with the majority (77%)
being medical in nature. The Department continues to support the annual Hands-Only CPR initiative as
a charter provider. The fire inspector provides existing business inspections, fire code enforcement, and
plans review and site inspections of new projects. This proactive approach to fire prevention has resulted
in decreased incidents of commercial responses. In FY2017, a 2010 ambulance was replaced with a
new, state-of-the-art unit. Through the CIP, the Department anticipates replacing older apparatus on a
rolling schedule that will allow it to maintain high quality service to the Village’s residents and guests.
The Human Resources Department is committed to fostering a work environment that attracts quality
applicants and encourages employees to perform at the highest level in support of the Village's goals
and objectives. In accordance with the Council's direction to "continuously improve the way the Village
operates", the Department strives to promulgate policies and procedures that are consistent across all
administrative functions while remaining current, relevant and compliant with local, state and federal labor
and personnel laws. Having implemented a new performance evaluation system for personnel in the Fire
Rescue Department in 2016, Human Resources expanded the pay for performance initiative to
encompass other employee groups in 2017, specifically to include Police Department personnel. The
Department will enhance the initiative’s effectiveness by focusing evaluation criteria on those that best
measure employees’ adherence to the organization’s values, their ability to perform their key functions
and, in some cases, their display of extraordinary effort or innovation to achieve the Village Council’s
goals for the organization or the community. In addition, Human Resources will focus on offering diverse
training programs and related opportunities to staff members in the areas of Business Etiquette and
Professionalism, Cultural Diversity, Conflict Resolution, Office Safety, Progressive Discipline, Drug-
Free/Alcohol-Free Workplace, and Leadership skills.. Lastly, the Department, in its role of managing
Workers' Compensation (W/C) cases in conjunction with the W/C insurance carrier, is working with the
Gehring Group's risk management team, as well as the newly established Employee Safety Committee,
to seek solutions to reduce instances of injury, lower W/C costs and provide a more positive claims
experience for all stakeholders.
vi
The Library is focused on building a strategic relationship with The Conservatory School. To accomplish
this, initial steps include issuing each student a Library card and having classes visit the Library weekly
to checkout materials and listen to stories. The Library is currently streamlining processes and
procedures, upgrading outdated equipment, and reorganizing various departments. Additionally,
renovations within the Library to create a better experience for children and teens were recently
completed.
The Information Technology Department has been involved in numerous projects over the last year:
preparing the Village for Phase Two of the LPR (License Plate Recognition) systems, Police laptop
encryption, Country Club renovation and installations for temporary facilities, Library computer lab
automation, and upgrading the Village’s phone system. The IT Department also implemented
ArchiveSocial to retrieve and archive all of the Village’s social media outlets.
The North Palm Beach Country Club will undergo a multi-million dollar renovation that includes a new
clubhouse and ancillary facilities for members, residents, guests, and non-members alike. The new
facility will have new dining options, a splash park for juniors, updated administrative offices, a new pool
deck with updated shade structures, multipurpose rooms, locker rooms and an updated golf shop sizable
to the demand of a golf course that supports approximately 42,000+ annual rounds. The goal of the Golf
Operations Department is to continue to provide first class service at the Jack Nicklaus Signature
municipal facility and expand upon its broad range of programming to juniors, women, seniors, beginners,
families as well as avid golfers. The Golf Operations Department will also be working with Nicklaus Design
Group to implement a project to renovate the golf course and upgrade the driving range turf and lighting
at a cost of approximately $1.5 million.
The Administration continues its ongoing implementation of an optical records storage system
(Laserfiche) that allows Village departments to transition - over time - from paper records to optically
stored records. These systems are now widely used by governments and meet all State record storage
requirements. Optical storage permits digital “look up” of any optical record “at will” through the
convenience of a simple computer search. It should be noted that the cost is relatively modest when
considering the time savings benefits and customer service improvements.
To improve residents’ access to information about policy and financial decisions, meetings and events,
capital projects and other important community matters, the Village Council approved staff’s
recommendation to fund a Communications Manager position as part of the FY 2018 budget. More
robust and consistent use of social media, newsletters, and community meetings will be used to share
information and receive public feedback.
For Fiscal Year 2017-2018, the Village Council reiterated its primary objective to sustain the Village as
the “Best Place to Live Under the Sun.” As part of that objective, the Council developed the following
goals to guide the budget process:
1. Provide a sustainable financial base for the Village
2. Maintain quality of all recreational facilities of the Village
3. Maintain a high quality of life and improve the overall appearance in the Village
4. Build a new Country Club Clubhouse
5. Implement the Master Plan for business economic development in our commercial corridors and
community development in our neighborhoods
6. Continuously improve the way the Village operates
7. Complete the implementation of the Pay for Performance System
8. Implement and maintain a long-term (10-year) capital improvement plan
9. Establish programs to create a “family-feel” within the organization
vii
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. To substantiate that this requirement has been met, the
independent auditor's report is included in this report.
Awards
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, 2016, the 29th
consecutive year the Village has received this award. The Certificate of Achievement is a prestigious
national award, recognizing conformance with the highest standards for preparation of state and local
government financial reports. In order to be awarded a Certificate of Achievement, the governmental unit
must publish an easily readable and efficiently organized CAFR. This report satisfied both GAAP and
applicable legal requirements.
A Certificate of Achievement is valid for a period of one year only. We expect our current CAFR will meet
the Certificate of Achievement Program’s requirements and we are submitting it to the GFOA to determine
its eligibility for another certificate.
The GFOA also presented a Distinguished Budget Presentation Award to the Village for its annual
budget for the fiscal year beginning October 1, 2016, the 9th consecutive year the Village has received
this award (previously this award had not been received since 1995). The Distinguished Budget
Presentation Award is a prestigious national award that recognizes conformance with the highest
principles of governmental budgeting. In order to qualify for the Distinguished Budget Presentation
Award, a governmental unit must publish a budget document that meets program criteria as a policy
document, as an operations guide, as a financial plan, and as a communication device.
Acknowledgements
The preparation of this report would not have been possible without the efficient and dedicated services
from the entire staff of the Finance Department.
We would like to thank the Mayor and Council for their unfailing support for maintaining the highest
standards of professionalism in the management of the Village of North Palm Beach’s finances.
Respectfully submitted,
Andrew D. Lukasik
Village Manager
viii
THE VILLAGE OF NORTH PALM BEACH, FLORIDA
PRINCIPAL VILLAGE OFFICIALS
SEPTEMBER 30, 2017
Title Name
Mayor Darryl C. Aubrey
Vice Mayor Robert A. Gebbia
President Pro Tem Mark Mullinix
Council Member David B. Norris
Council Member Susan Bickel
Village Manager Andrew D. Lukasik
Director of Finance Samia Janjua
Village Clerk Melissa Teal
ix
x
Government Finance Officers Association
Certificate of
Achievement
for Excellence
in Financial
Reporting
Presented to
Village of North Palm Beach
Florida
For its Comprehensive Annual
Financial Report
for the Fiscal Year Ended
September 30, 2016
Executive Director/CEO
FINANCIAL SECTION
1
INDEPENDENT AUDITOR'S REPORT
The Honorable Mayor and Members of the Village Council
The Village of North Palm Beach, Florida
Report on the Financial Statements
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, 2017, and the
related notes to the financial statements, which collectively comprise the Village of North Palm
Beach, Florida’s basic financial statements as listed in the table of contents.
Management’s Responsibility for the Financial Statements
Management is responsible for the preparation and fair presentation of these financial statements
in accordance with accounting principles generally accepted in the United States of America;
this includes the design, implementation, and maintenance of internal control relevant to the
preparation and fair presentation of financial statements that are free from material misstatement,
whether due to fraud or error.
Auditor’s Responsibility
Our responsibility is to express opinions on these financial statements based on our audit. We
conducted our audit in accordance with auditing standards generally accepted in the United
States of America and the standards applicable to financial audits contained in Government
Auditing Standards, issued by the Comptroller General of the United States. Those standards
require that we plan and perform the audit to obtain reasonable assurance about whether the
financial statements are free from material misstatement.
An audit involves performing procedures to obtain audit evidence about the amounts and
disclosures in the financial statements. The procedures selected depend on the auditor’s
judgment, including the assessment of the risks of material misstatement of the financial
statements, whether due to fraud or error. In making those risk assessments, the auditor considers
internal control relevant to the entity’s preparation and fair presentation of the financial
statements in order to design audit procedures that are appropriate in the circumstances, but not
2
for the purpose of expressing an opinion on the effectiveness of the entity’s internal control.
Accordingly, we express no such opinion. An audit also includes evaluating the appropriateness
of accounting policies used and the reasonableness of significant accounting estimates made by
management, as well as evaluating the overall presentation of the financial statements.
We believe that the audit evidence we have obtained is sufficient and appropriate to provide a
basis for our audit opinions.
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, 2017, and the respective changes in financial position and, where
applicable, cash flows thereof for the year then ended in accordance with accounting principles
generally accepted in the United States of America.
Other Matters
Required Supplementary Information
Accounting principles generally accepted in the United States of America require that the
Management’s Discussion and Analysis on pages 4 through 13, Pension and Other
Postemployment Benefit trend information on pages 74 through 78, and budgetary comparison
information on pages 79 through 80 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.
Other Information
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 basic financial statements. The
introductory section, other supplementary information, and statistical section are presented for
purposes of additional analysis and are not a required part of the basic financial statements.
3
The other supplementary information is the responsibility of management and was derived from
and relate directly to the underlying accounting and other records used to prepare the basic
financial statements. Such information has been subjected to the auditing procedures applied in
the audit of the basic financial statements and certain additional procedures, including comparing
and reconciling such information directly to the underlying accounting and other records used to
prepare the basic financial statements or to the basic financial statements themselves, and other
additional procedures in accordance with auditing standards generally accepted in the United
States of America. In our opinion, the other supplemental information is fairly stated in all
material respects in relation to the basic financial statements as a whole.
The Introductory Section and Statistical Section have not been subjected to the auditing
procedures applied in the audit of the basic financial statements and, accordingly, we do not
express an opinion or provide any assurance on them.
Other Reporting Required by Government Auditing Standards
In accordance with Government Auditing Standards, we have also issued our report dated
March 7, 2018, 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
the results of that testing and not to provide an opinion on internal control over financial
reporting or on compliance. That report is an integral part of an audit performed in accordance
with Government Auditing Standards in considering the Village of North Palm Beach, Florida’s
internal control over financial reporting and compliance.
West Palm Beach, Florida
March 7, 2018
4
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, 2017. 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)
September 30,Increase/Statement
2017 2016 (Decrease)Page #
Total net position $23.36 $23.47 ($0.11)14
Unrestricted net position available for future use $6.90 $7.10 ($0.20)14
Governmental net position $21.01 $21.18 ($0.17)14
Total revenues from all sources $26.25 $25.58 $0.67 15
Governmental revenues $23.29 $21.81 $1.48 15
Total cost of all Village programs $26.36 $25.53 $0.83 15
Governmental revenues over (under) expenses ($0.17)$0.12 ($0.29)16
General fund revenues over (under) expenses $0.76 $1.74 ($0.98)19
General fund unassigned fund balance $11.81 $10.72 $1.09 17
As a percent of general fund expenditures 54.99%54.18%0.81%
Country Club revenues over (under) expenses $0.05 ($0.08)$0.13 22
Change in total long-term debt for the Village $14.56 ($0.29)$14.85
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 Position 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 ON THE VILLAGE AS A WHOLE
Statement of Net Position 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 Position 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, deferred outflows of resources, liabilities and
deferred inflows of resources 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.
5
These two statements report the Village's net position and changes therein. Net position, the difference
between assets plus deferred outflows of resources and liabilities plus deferred inflows of resources, is
one way to measure the Village's financial health, or financial position. Over time, increases or decreases
in net position are an indicator of whether the financial health is improving or deteriorating.
The Statement of Net Position 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
types 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 available for spending remaining at year-
end. These funds are reported using an accounting method called the modified accrual accounting
method, which measures cash and all other financial assets that can be converted to cash readily.
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 seven individual governmental funds: the General Fund, one Capital
Projects Fund, and five 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, the Infrastructure Surtax Fund,
and the Capital Projects Fund all 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; a fund may also 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 is combined into a single column for
an aggregated presentation. The basic governmental fund financial statements can be found on
pages 17-20 of this report.
6
• 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 Position and
the Statement of Activities. The basic proprietary fund financial statements can be found on pages
21-23 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 24-25 of this report.
GOVERNMENT-WIDE FINANCIAL ANALYSIS
As noted earlier, net positon may serve over time as a useful indicator of a government's financial
position. In the case of the Village, the net position was $23.36 million at the close of the most recent
fiscal year.
A significant portion of the Village's net position (66.23%) reflects its investment in capital assets (e.g.,
land, buildings, machinery, and equipment), less any related debt still outstanding, which was used to
acquire those assets. The Village uses these capital assets to provide services to citizens; consequently,
these assets are not available for future spending.
7
Table 2
Village of North Palm Beach
Net Position
(In Thousands)
Governmental Business-type
Activities Activities Total
2017 2016 2017 2016 2017 2016
Assets:
Current and other assets 30,326$ 15,122$ 655$ 858$ 30,981$ 15,980$
Capital assets 14,479 14,102 4,238 4,551 18,717 18,653
Total assets 44,805 29,224 4,893 5,409 49,698 34,633
Deferred outflows of resources:4,044 3,951 4,044 3,951
Liabilities:
Current liabilities 1,248 1,125 149 197 1,397 1,322
Long-term liabilities 24,720 10,305 2,391 2,913 27,111 13,218
Total liabilities 25,968 11,430 2,540 3,110 28,508 14,540
Deferred inflows of resources:1,867 566,166 1,867 566,166
Net positon:
Net investement in capital assets 13,485 14,102 1,991 1,880 15,476 15,982
Restricted 992 399 992 399
Unrestricted 6,536 6,678 362 419 6,898 7,097
Total net position 21,013$ 21,179$ 2,353$ 2,299$ 23,366$ 23,478$
Governmental Activities
The cost of all governmental activities this year was $23.46 million. As shown on Table 3, Changes in
Net Position, those who directly benefited from the programs paid for $3.48 million of this cost and
$19.81 million was financed through general revenues. Governmental activities decreased the Village's
net position by $0.17 million, thereby accounting for 100% of the total decrease in the net position of the
Village.
Additional detail is shown in Table 3, which follows on the subsequent page.
8
Table 3
Village of North Palm Beach
Changes in Net Position
(In Thousands)
Activities Total
2017 2016 2017 2016 2017 2016
Revenues:
Program revenues:
Charges for services 3,484$ 3,530$ 2,946$ 3,721$ 6,430$ 7,251$
Operating grants and contributions 377 366 377 366
Capital grants and contributions 102 229 102 229
General revenues:
Property taxes 13,092 12,254 13,092 12,254
Local option gas taxes 306 288 306 288
Utility service taxes 2,414 2,303 2,414 2,303
Sales and use taxes 1,924 1,364 1,924 1,364
Franchise taxes 1,307 1,264 1,307 1,264
Investment earnings 127 103 10 9 137 112
Miscellaneous 151 60 151 60
Gain on asset disposals 7 48 36 7 84
Total revenues 23,291 21,809 2,956 3,766 26,247 25,575
Expenses:
Program expenses:
General Government 3,206 2,985 3,206 2,985
Public Safety 9,906 9,309 9,906 9,309
Public Works 5,707 5,106 5,707 5,106
Community Development & Planning 1,255 1,382 1,255 1,382
Leisure Services 3,115 2,905 3,115 2,905
Interest on long-term debt 267 267 -
Country Club 2,903 3,845 2,903 3,845
Total expenses 23,456 21,687 2,903 3,845 26,359 25,532
Increase (decrease) in net position (165) 122 53 (79) (112) 43
Net position - beginning of year 21,178 21,056 2,300 2,379 23,478 23,435
Net position - end of year 21,013$ 21,178$ 2,353$ 2,300$ 23,366$ 23,478$
Governmental Business-type
Activities
9
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.
Table 4
Village of North Palm Beach
Cost of services
(In Thousands)
Total Cost Net Cost Total Cost Net Cost
of Services of Services of Services of Services
General government 3,206$ (3,068)$ 2,985$ (2,850)$
Public safety 9,906 (9,013)9,309 (8,345)
Public works 5,707 (5,124)5,106 (4,520)
Community development 1,255 (32)1,382 (169)
Leisure services 3,115 (1,988)2,905 (1,678)
Interest on long-term debt 267 (267)
23,456$ (19,492)$ 21,687$ (17,562)$
2017 2016
At the end of the current year, as compared to the prior year, the total cost of services increased by $1.77
million. This change in cost can be broken down as follows:
• A $0.40 million increase in capital related costs.
• A $0.66 million increase personnel related costs.
• A $0.27 million increase in accrued interest on long-term debt resulting from a $15 million loan
that was secured for the Country Club Clubhouse project.
Business-Type Activities
At the end of the current year, as compared to the prior year, Charges for Services (revenues) for the
Business-type activities decreased by $0.77 million and expenses decreased by $0.94 million. Net
positon of the Proprietary Fund (Country Club) at September 30, 2017, were $2.35 million. Net position
increased by $53,482 in the current year vs. a decrease of $79,351 in the prior year, resulting in a positive
impact of $132,833.
The positive impact in the Village’s Business-type activities was largely due to outsourcing the
Restaurant Operations. The Enterprise Fund is on solid financial footing; however, there are serious
infrastructure issues related to the clubhouse that need to be addressed. The Village is in the process of
the construction of a new clubhouse; therefore, no major repairs to the current building are budgeted in
the upcoming year.
10
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 $29.14
million, a $15.34 million increase over the 2016 fund balance of $13.80 million. Approximately 49% of
the combined ending fund balance ($14.19 million) constitutes unrestricted (unassigned/assigned) fund
balance, which is available for spending at the government's discretion. The remainder of fund balance
($14.95 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 $11.81 million while the General Fund total fund
balance was $13.09 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 55% of total general fund expenditures, while total fund balance represents 61% of that same amount.
The general fund unassigned fund balance ($11.81 million) represents an increase of $1.09 million over
the 2016 unassigned general fund balance of $10.72 million. Key elements of this increase are listed
below:
• Revenues for Franchise Fees and Utility Service Taxes were budgeted on prior year trends ($3.37
million). For the current year, the Village received $3.72 million.
• Due to discounts for prompt payments, State law requires that only 95% of the gross ad-valorem
taxes be budgeted as revenue ($12.87 million). For the current year, the Village received $13.09
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 $15,355,289 and can be
briefly summarized as follows:
• Debt Proceeds ($15,000,000)
• Prior Year Open Purchase Order Carryover ($258,207)
• Use of General Fund Assigned Fund Balance – Streets ($44,000)
• Transfer in from Capital Project Fund ($53,082)
11
General Fund Budget Analysis
As shown on pages 81-83 of this report, in the Schedule of Departmental Expenditures – Budget and
Actual, there was an overall favorable budget to actual cost variance of $842,427 in General Fund
Departmental Expenditures. This is primarily a result of several unfinished projects at fiscal year-end that
were carried over into the following fiscal year ($755,276).
Capital Projects Fund
The Village’s Capital Projects Fund is project specific and involves multi-year projects. Appropriations in
this fund remain open and carry 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 $15.10
million, a $13.45 million increase over the 2016 fund balance of $1.65 million. This is primarily due to a
transfer of loan proceeds to finance the Country Club Clubhouse project.
Infrastructure Surtax Fund
The Village’s Infrastructure Surtax Fund is used to account for surtax proceeds. On November 8, 2016
PBC voters approved a one-cent sales surtax, raising the sales tax from 6% to 7% effective January 1,
2017. The surtax will sunset on December 31, 2026. The use of surtax proceeds are restricted to, among
other things, the financing, planning and construction of infrastructure. Appropriations in this fund
remain open and carry 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 $0.55 million.
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, 2017 and 2016 amounts to $18.72 million and $18.67 million, respectively (net of
accumulated depreciation).
12
Table 5
Village of North Palm Beach
Capital Assets
(In Thousands)
Governmental Business-type
Activities Activities Total
2017 2016 2017 2016 2017 2016
Land 2,056$ 2,056$ 1,051$ 1,051$ 3,107$ 3,107$
Construction in progress 1,171 21 228 228 1,399 249
Buildings and improvements 23,577 23,590 1,405 1,405 24,982 24,995
Improvements other than buildings 322 322 322 322
Improvements - golf course 5,824 5,824 5,824 5,824
Furniture, fixtures and equipment 8,072 7,891 308 308 8,380 8,199
Total assets 34,876 33,558 9,138 9,138 44,014 42,696
Less accumulated depreciation (20,397) (19,455) (4,900)(4,573)(25,297) (24,028)
Net position 14,479$ 14,103$ 4,238$ 4,565$ 18,717$ 18,668$
Additional information on the Village's capital assets can be found in Note 5 on pages 46 through 47 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 $17.25 million; $15 million in the governmental activities
and $2.25 million in business-type activities. A $15 million loan was secured in the fiscal year to finance
the Village’s Country Club Clubhouse project. None of the Village’s long-term debt comprises debt
backed by the full faith and credit of the government.
Table 6
Village of North Palm Beach
Outstanding Debt
(In Thousands)
Governmental Business-type
Activities Activities Total
2017 2016 2017 2016 2017 2016
Loans payable 15,000$ 2,247$ 2,685$ 17,247$ 2,685$
Total 15,000$ $2,247$ 2,685$ 17,247$ 2,685$
Additional information on the Village's debt can be found in Note 6 on pages 48 through 50 of this report.
13
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 $11.81 million during the current 2017
fiscal year. The Village is now ready to address the economic challenges anticipated in the next few
years.
The FY 2017/18 Budget reflects continued improvement to citizen services, public safety, and public
facility maintenance while emphasizing improved community appearance and financial stability. Most
importantly, the budget provides necessary resources for the Village of North Palm Beach to maintain and
further improve services to our residents without increasing the millage rate and without having to use the
General Fund Unassigned Fund Balance (General Fund Reserves).
The Village’s financial plan represents an aggressive approach to adequately maintain infrastructure and
address gaps in the organization in order to deliver services to the community while implementing the
North Palm Beach Country Club clubhouse construction and golf course renovation projects. Upcoming
investments into the clubhouse and golf course will result in increased expenditures and, due to the
closure of both facilities at different times during the projects, reduced Country Club revenues. However,
increasing property valuations and continued state and national economic growth will blunt the impact of
these short-term facility closures to the annual financial plan.
CONTACTING THE VILLAGE'S FINANCIAL MANAGEMENT
This financial report is designed to provide our citizens, taxpayers, customers, investors, and creditors
with a general overview of the Village's finances and to show the Village's accountability for the money it
receives. If you have questions about this report or need additional financial information, contact the
Village's Finance Department, at the Village of North Palm Beach, 501 U.S. Highway 1, North Palm
Beach, Florida 33408.
BASIC FINANCIAL STATEMENTS
Statement of Net Position
September 30, 2017
Governmental Business-type
Activities Activities Total
Assets
Cash and cash equivalents 5,591,637$ 532,451$ 6,124,088$
Investments 9,132,267 9,132,267
Accounts receivable 442,686 11,741 454,427
Accrued interest 26,388 26,388
Inventories 169,369 100,637 270,006
Prepaids 13,851 10,018 23,869
Due from other governments 256,016 256,016
Restricted assets:
Cash and cash equivalents 7,194,447 7,194,447
Investments 7,500,000 7,500,000
Capital assets:
Nondepreciable 3,226,874 1,279,129 4,506,003
Depreciable (net of depreciation)11,251,749 2,959,127 14,210,876
Total assets 44,805,284 4,893,103 49,698,387
Deferred outflows of resources
Pension related items 4,044,030 4,044,030
Total deferred outflows of resources 4,044,030 4,044,030
Liabilities
Accounts payable 558,872 45,580 604,452
Accrued liabilities 298,517 298,517
Unearned revenue 124,258 103,488 227,746
Accrued interest payable 266,892 266,892
Noncurrent liabilities:
Due within one year 1,664,297 325,819 1,990,116
Due in more than one year 23,055,817 2,065,587 25,121,404
Total liabilities 25,968,653 2,540,474 28,509,127
Deferred inflows of resources
Unearned revenue 204,383 204,383
Pension related items 1,662,784 1,662,784
Total deferred inflows of resources 1,867,167 1,867,167
Net position
Net investment in capital assets 13,484,731 1,991,168 15,475,899
Restricted for:
Country club project 66,123 66,123
Recreation 297,695 297,695
Infrastructure 554,604 554,604
Library 49,244 49,244
Other purposes 24,872 24,872
Unrestricted 6,536,225 361,461 6,897,686
Total net position 21,013,494$ 2,352,629$ 23,366,123$
See notes to the financial statements.
THE VILLAGE OF NORTH PALM BEACH, FLORIDA
14
THE VILLAGE OF NORTH PALM BEACH, FLORIDA
Statement of Activities
For the Year Ended September 30, 2017
Charges for
Functions/Programs Expenses Activities
Government:
Governmental activities
General government 3,205,903$ 134,249$
Public safety 9,905,815 557,265
Public works 5,707,570 547,596
Community development and planning 1,255,115 1,222,464
Leisure services 3,114,720 1,022,175
Interest expense 266,892
Total governmental activities 23,456,015 3,483,749
Business-type activities - country club 2,903,224 2,946,432
Total business-type activities 2,903,224 2,946,432
Total government 26,359,239$ 6,430,181$
15
Program Revenues Net Expense (Revenue) and
Operating Capital Changes in Net Position
Grants and Grants and Governmental Business-type
Contributions Contributions Activities Activities Total
3,779$ $ (3,067,875)$ $ (3,067,875)$
316,775 18,992 (9,012,783) (9,012,783)
35,648 (5,124,326) (5,124,326)
(32,651) (32,651)
21,137 83,195 (1,988,213) (1,988,213)
(266,892) (266,892)
377,339 102,187 (19,492,740) (19,492,740)
43,208 43,208
43,208 43,208
377,339$ 102,187$ (19,492,740) 43,208 (19,449,532)
General Revenues:
Taxes:
Property taxes 13,091,985 13,091,985
Local option gas taxes 305,700 305,700
Utility service taxes 2,413,679 2,413,679
Franchise taxes 1,306,997 1,306,997
Sales and use taxes 1,924,490 1,924,490
Investment income - unrestricted 126,926 10,274 137,200
Miscellaneous 150,698 150,698
Gain on disposal of equipment 6,843 6,843
Total general revenues 19,327,318 10,274 19,337,592
Change in net position (165,422) 53,482 (111,940)
Net position, beginning of year 21,178,916 2,299,147 23,478,063
Net position, end of year 21,013,494$ 2,352,629$ 23,366,123$
See notes to the financial statements.
16
THE VILLAGE OF NORTH PALM BEACH, FLORIDA
Balance Sheet
Governmental Funds
September 30, 2017
Infrastructure Capital Nonmajor Total
Surtax Projects Governmental Governmental
General Fund Fund Funds Funds
Assets
Cash and cash equivalents 3,512,360$ $ 1,634,959$ 444,318$ 5,591,637$
Investments 9,132,267 9,132,267
Accounts receivable 442,686 442,686
Accrued interest 26,388 26,388
Inventories 169,369 169,369
Prepaids 13,851 13,851
Due from other funds 44,028 44,028
Due from other governments 177,172 76,053 2,791 256,016
Restricted cash and cash equivalents 781,756 478,551 5,934,140 7,194,447
Restricted investments 7,500,000 7,500,000
Total assets 14,255,849$ 554,604$ 15,113,127$ 447,109$ 30,370,689$
Liabilities, deferred inflows of resources, and fund balances
Liabilities
Accounts payable 535,981$ $ 8,791$ 14,100$ 558,872$
Accrued liabilities 298,517 298,517
Due to other funds 44,028 44,028
Unearned revenue 124,258 124,258
Total liabilities 958,756 8,791 58,128 1,025,675
Deferred inflows of resources
Unearned revenue 204,383 204,383
Total deferred inflows of resources 204,383 204,383
Fund balances
Nonspendable:
Inventories and prepaids 183,220 183,220
Restricted for:
Country club project 455,445 13,388,640 13,844,085
Recreation 252,195 45,500 297,695
Infrastructure 554,604 554,604
Streets and roads 13,185 13,185
Police 8,914 8,914
Library 49,244 49,244
Other purposes 2,773 2,773
Assigned for:
Small business grants 16,435 16,435
Subsequent year's expenditures 299,831 299,831
Special revenue funds 388,981 388,981
Capital project funds 1,670,196 1,670,196
Unassigned 11,811,468 11,811,468
Total fund balances 13,092,710 554,604 15,104,336 388,981 29,140,631
Total liabilities, deferred inflows of
resources, and fund balances 14,255,849$ 554,604$ 15,113,127$ 447,109$ 30,370,689$
See notes to the financial statements.
17
THE VILLAGE OF NORTH PALM BEACH, FLORIDA
Reconciliation of the Balance Sheet – Governmental Funds
to the Statement of Net Position
September 30, 2017
Fund balances - total governmental funds 29,140,631$
Amounts reported for governmental activities in the statement of net
position are different because:
Capital assets used in governmental activities are not financial
resources and therefore are not reported in the governmental funds:
Governmental capital assets 34,875,842$
Less: accumulated depreciation (20,397,219)
14,478,623
Accrued interest payable (266,892)
Revenue notes (15,000,000)
Net pension liability (5,649,589)
Other postemployement benefits (2,734,744)
Accrued compensated absences (1,335,781)
(24,987,006)
Pension related deferred outflows 4,044,030
Pension related deferred inflows (1,662,784)
2,381,246
Net position of governmental activities 21,013,494$
See notes to the financial statements.
Long-term 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:
Deferred outflows and inflows of resources related to pensions are
applicable to future periods and, therefore, are not reported in the
govenmental funds:
18
THE VILLAGE OF NORTH PALM BEACH, FLORIDA
Statement of Revenues, Expenditures, and Changes in Fund Balances
Governmental Funds
For the Year Ended September 30, 2017
Infrastructure Capital Nonmajor Total
Surtax Projects Governmental Governmental
General Fund Fund Funds Funds
Revenues
Taxes 17,118,361$ $ $ $ 17,118,361$
Licenses and permits 997,656 997,656
Intergovernmental 1,459,579 552,600 405,630 2,417,809
Charges for services 2,321,298 2,321,298
Fines and forfeitures 124,395 124,395
Investment 58,799 2,004 66,123 126,926
Miscellaneous 157,063 157,063
Total revenues 22,237,151 554,604 66,123 405,630 23,263,508
Expenditures
Current
General government 2,970,223 2,970,223
Public safety 8,856,922 309,138 9,166,060
Public works 4,882,159 4,882,159
Community development and planning 1,190,759 1,190,759
Leisure services - recreation 2,591,866 2,591,866
Capital outlay 985,885 921,865 215,992 2,123,742
Total expenditures 21,477,814 921,865 525,130 22,924,809
Excess (deficiency) of revenues
over (under) expenditures 759,337 554,604 (855,742) (119,500) 338,699
Other financing sources (uses)
Debt proceeds 15,000,000 15,000,000
Transfers in 53,082 14,363,587 14,416,669
Transfers out (14,363,587) (53,082) (14,416,669)
Total other financing sources (uses)689,495 14,310,505 15,000,000
Net change in fund balances 1,448,832 554,604 13,454,763 (119,500) 15,338,699
Fund balances
Beginning of year 11,643,878 1,649,573 508,481 13,801,932
End of year 13,092,710$ 554,604$ 15,104,336$ 388,981$ 29,140,631$
See notes to the financial statements.
19
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, 2017
Net change in fund balances - total governmental funds 15,338,699$
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 1,906,689$
Less: current year depreciation (1,507,698)
Net book value for retired assets (22,915)
376,076
The issuance of long-term debt provides current financial resources to
governmental funds, while the repayment of long-term debt consumes the
current financial resources of governmental funds. Neither transaction,
however, has any affect on net assets of governmental activities:
Revenue notes issued (15,000,000)
Claims and settlements 50,000 (14,950,000)
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 accrued interest payable (266,892)
Change in long-term compensated absences (139,885)
Change in net pension liability and related deferred amounts (264,970)
Change in other postemployment benefits (258,450)
(930,197)
Change in net position (165,422)$
See notes to the financial statements.
20
THE VILLAGE OF NORTH PALM BEACH, FLORIDA
Statement of Net Position
Proprietary Fund
September 30, 2017
Enterprise
Assets
Current assets
Cash and cash equivalents 532,451$
Accounts receivable 11,741
Inventories 100,637
Prepaids 10,018
Total current assets 654,847
Non-current assets
Capital assets, net 4,238,256
Total non-current assets 4,238,256
Total assets 4,893,103
Liabilities
Current liabilities
Accounts payable 45,580
Unearned revenue 103,488
Compensated absences - current portion 18,100
Loans payable - current portion 307,719
Total current liabilities 474,887
Non-current liabilities
Other postemployement benefits 119,439
Compensated absences 6,779
Loans payable 1,939,369
Total non-current liabilities 2,065,587
Total liabilities 2,540,474
Net position
Net investment in capital assets 1,991,168
Unrestricted 361,461
Total net position 2,352,629$
See notes to the financial statements.
21
THE VILLAGE OF NORTH PALM BEACH, FLORIDA
Statement of Revenues, Expenses, and Changes in Net Position
Proprietary Fund
For the Year Ended September 30, 2017
Enterprise
Operating revenue
Greens fee/cart rentals/membership fees 2,302,645$
Golf shop revenues 296,119
Driving range revenues 303,994
Restaurant revenues 32,595
Miscellaneous 11,079
Total operating revenues 2,946,432
Operating expenses
Golf course maintenance expenses 1,137,008
Clubhouse grounds expenses 120,795
Golf shop expenses 996,499
Food and beverage expenses 65,579
Administrative and general 105,462
Insurance 47,469
Depreciation and amortization 327,078
Total operating expenses 2,799,890
Operating income (loss)146,542
Nonoperating revenues (expenses)
Interest revenue 10,274
Interest expense (103,334)
Total nonoperating revenues (expenses)(93,060)
Change in net position 53,482
Net position - beginning 2,299,147
Net position - ending 2,352,629$
See notes to the financial statements.
22
THE VILLAGE OF NORTH PALM BEACH, FLORIDA
Statement of Cash Flows
Proprietary Fund
For the Year Ended September 30, 2017
Enterprise
Cash flows from operating activities:
Receipts from customers 2,944,444$
Payments to suppliers for goods or services (1,917,902)
Payments to employees for services (606,588)
Net cash provided by operating activities 419,954
Cash flows from capital and related financing activities:
Principal paid on long term debt (437,825)
Interest paid on debt (159,413)
Net cash provided (used) by capital and related financing activities (597,238)
Cash flows from investing activities:
Interest and dividends on investments 10,274
Net increase (decrease) in cash and cash equivalents (167,010)
Cash and cash equivalents at beginning of year 699,461
Cash and cash equivalents at end of year 532,451$
Reconciliation of operating income
to net cash provided by operating activities:
Operating income 146,542$
Adjustments to reconcile operating income
to net cash provided by operating activities:
Depreciation and amortization 327,078
Change in assets and liabilities
Decrease in accounts receivable 6,089
Decrease in inventory 15,437
Decrease in prepaids 581
Decrease in accounts payable (39,456)
Decrease in compensated absences payable (35,658)
Decrease in deferred revenue (8,077)
Increase in other postemployment benefits 7,418
Total adjustments 273,412
Net cash provided by operating activities 419,954$
See notes to the financial statements.
23
THE VILLAGE OF NORTH PALM BEACH, FLORIDA
Statement of Fiduciary Net Position
Fiduciary Funds
September 30, 2017
Employee
Retirement Agency
Funds Funds
Assets
Cash and cash equivalents 587,598$ 367,404$
Investments:
Domestic common equity securities 10,757,817
International common equity securities 2,393,230
U.S. Government and agencies 1,991,487
Municipal bonds 311,950
Corporate bonds 3,477,006
Fixed income exchange traded funds 2,789,819
Equity exchange traded funds 2,944,061
Fixed income mutual funds 2,640,119
Equity mutual funds 6,462,257
Real estate investment fund 2,386,295
Money market mutual funds 1,151,404
Accrued interest and dividends 58,479
Accounts receivable 113,125
Prepaids 2,182
Total assets 38,066,829 367,404
Liabilities
Accounts payable 62,346
Due to others 367,404
Total liabilities 62,346 367,404
Net position restricted for pensions 38,004,483$ $
See notes to the financial statements.
24
THE VILLAGE OF NORTH PALM BEACH, FLORIDA
Statement of Changes in Fiduciary Net Position
Fiduciary Funds
For the Year Ended September 30, 2017
Employee
Retirement
Funds
Additions
Contributions
Employer 1,473,497$
Plan members 329,793
State on-behalf payments 309,138
Total contributions 2,112,428
Investment earnings
Dividends and interest 919,323
Net increase in fair value
of investments 2,975,538
Total investment earnings 3,894,861
Less: investment expenses 208,525
Total net investment earnings 3,686,336
Total additions 5,798,764
Deductions
Administrative expense 99,379
Termination refunds 14,044
Benefits 1,121,200
Total deductions 1,234,623
Change in net position 4,564,141
Net position - beginning 33,440,342
Net position - ending 38,004,483$
See notes to the financial statements.
25
THE VILLAGE OF NORTH PALM BEACH, FLORIDA
Notes to the Basic Financial Statements
September 30, 2017
26
NOTE 1 – 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.
As required by generally accepted accounting principles, these financial statements include the
Village (the primary government) and its component units. Component units are legally separate
entities for which the Village is financially accountable. The Village is financially accountable if:
• it appoints a voting majority of the organization’s governing board and (1) it is able to
impose its will on the organization, or (2) there is a potential for the organization to
provide specific financial benefits to or impose specific financial burdens on the Village,
or
• the organization is fiscally dependent on the Village and (1) there is a potential for the
organization to provide specific financial benefits to the Village or (2) impose specific
financial burdens on the Village.
Organizations for which the Village is not financially accountable are also included when doing
so is necessary in order to prevent the Town’s financial statements from being misleading.
Based upon application of the above criteria, the Village of North Palm Beach has determined
that there are two legally separate entities to consider as potential component units. The Village
of North Palm Beach General Employees’ Retirement Fund and the Village of North Palm Beach
Fire and Police Retirement Fund are component units as they are fiscally dependent on and
impose a specific financial burden on the Village. They are reported in the Village’s financial
statements as pension trust funds in the fiduciary funds financial statements.
B. Government-wide and Fund Financial Statements
The government-wide financial statements (i.e., the statement of net position and the statement
of activities) report information on all 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.
THE VILLAGE OF NORTH PALM BEACH, FLORIDA
Notes to the Basic Financial Statements
September 30, 2017
27
NOTE 1 – 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 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.
THE VILLAGE OF NORTH PALM BEACH, FLORIDA
Notes to the Basic Financial Statements
September 30, 2017
28
NOTE 1 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued)
C. Measurement Focus, Basis of Accounting 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.
Infrastructure Surtax Fund
The Infrastructure Surtax Fund is special revenue fund used to account for the surtax proceeds
which are restricted to, among other things, the financing, planning and construction of
infrastructure.
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.
THE VILLAGE OF NORTH PALM BEACH, FLORIDA
Notes to the Basic Financial Statements
September 30, 2017
29
NOTE 1 – 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.
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 needed.
D. Assets, Liabilities, and Net Position or Equity
Cash and Cash Equivalents
Cash and cash equivalents consist of petty cash, deposits in checking accounts, money market
mutual funds, and investments with Florida Prime managed by the State of Florida, State Board
of Administration. All money market mutual funds are registered as a 2a-7 fund with the SEC
and reported at amortized cost. Deposits in Florida Prime are generally available for withdrawal
by the Village on a next day basis and are therefore considered cash equivalents. Florida Prime
is an external investment pool administered by the State of Florida, which operates as a “2a7-
like” pool under GASB Statement No. 31. As such, the pool uses amortized cost for valuation of
the pool shares and the fair value of the shares in the pool is the same as the Village’s investment
in the pool shares.
For purposes of determining cash equivalents, the Village has defined its policy concerning the
treatment of short-term investments to include investments with a maturity of three months or
less when purchased, as cash equivalents if management does not plan to reinvest the proceeds.
Short-term investments that management intends to rollover into similar investments are
considered part of the investment portfolio and are classified as investments.
THE VILLAGE OF NORTH PALM BEACH, FLORIDA
Notes to the Basic Financial Statements
September 30, 2017
30
NOTE 1 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued)
D. Assets, Liabilities, and Net Position 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 as required by generally accepted accounting principles.
The fair value of an investment is the amount that the Village could reasonably expect to receive
for it in a current sale between a willing buyer and a willing seller, other than in a forced or
liquidation sale. Purchases and sales of investments are recorded on a trade date basis.
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 to” 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). The costs of
governmental fund type inventory are recorded as expenditures when consumed rather than when
purchased. 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.
Payments made to vendors for services that will benefit future periods are reported as prepaid
items using the consumption method by recording an asset for the prepaid amount and reflecting
an expenditure in the year in which the services are consumed.
THE VILLAGE OF NORTH PALM BEACH, FLORIDA
Notes to the Basic Financial Statements
September 30, 2017
31
NOTE 1 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued)
D. Assets, Liabilities, and Net Position 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 is
determined by the fund’s 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 position. 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. Donated
capital assets, donated works of art and similar items, and capital assets received in a service
concession arrangement are recorded at acquisition value.
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
THE VILLAGE OF NORTH PALM BEACH, FLORIDA
Notes to the Basic Financial Statements
September 30, 2017
32
NOTE 1 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued)
D. Assets, Liabilities, and Net Position or Equity (Continued)
Deferred Outflows and Inflows of Resources
The statement of net position includes a separate section for deferred outflows of resources. This
represents the usage of net position applicable to future periods and will not be recognized as
expenditures until the future period to which it applies. The Village reports deferred pension
items in connection with its two Retirement Systems. These deferred pension charges are either
(a) recognized in the subsequent period as a reduction of the net pension liability (which includes
pension contributions made after the measurement date) or (b) amortized in a systematic and
rational method as pension expense in future periods.
The statement of net position also includes a separate section, listed below total liabilities, for
deferred inflows of resources. This represents the acquisition of net position applicable to future
periods and will not be recognized as revenue until the future period to which it applies. The
Village currently has two types of deferred inflows. The first is local business tax revenues
received prior to the period for which the taxes are levied, these are recognized as income in the
period for which they are levied. The second is deferred pension items in connection with its
two Retirement Systems. These items are amortized in a systemic and rational method and
recognized as a reduction of pension expense in future periods.
Unearned Revenue
The Village reports unearned revenue on its statements of net position and governmental funds
balance sheet. Unearned revenue arises when resources are obtained prior to revenue recognition.
In subsequent periods, when revenue recognition criteria are met the unearned 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
the amounts have matured, for example, as a result of employee resignations or retirements. For
the governmental funds, compensated absences are liquidated by the General Fund.
THE VILLAGE OF NORTH PALM BEACH, FLORIDA
Notes to the Basic Financial Statements
September 30, 2017
33
NOTE 1 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued)
D. Assets, Liabilities, and Net Position or Equity (Continued)
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 position. Bond premiums and discounts are deferred and amortized over the life of the bonds
using the effective interest method.
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 Position
Equity in the government-wide statement of net position and the proprietary fund is displayed in
three categories: 1) net investment in capital assets, 2) restricted, and 3) unrestricted. 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. Restricted
net position is reported when there are legal limitations imposed on their use by Village
legislation or external restrictions by other governments, creditors, or grantors. Unrestricted net
position consists of all net position that does not meet the definition of either of the other three
components.
Fund Equity
In the fund financial statements, governmental funds report fund balance classifications that
comprise a hierarchy based primarily on the extent to which the Village is bound to honor
constraints on the specific purposes for which amounts in those funds can be spent. Fund balance is
reported under the following categories:
• 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.
THE VILLAGE OF NORTH PALM BEACH, FLORIDA
Notes to the Basic Financial Statements
September 30, 2017
34
NOTE 1 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued)
D. Assets, Liabilities, and Net Position or Equity (Continued)
Fund Equity (Continued)
• Committed fund balance represents amounts that can be used only for the specific purposes
pursuant to constraints imposed by Village Commission by the adoption of an ordinance,
the Village’s highest level of decision making authority. Those committed amounts cannot
be used for any other purpose unless the Village removes or changes the specified use by
the adoption of an ordinance.
• 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, in
accordance with the Villages fund balance policy, that are neither considered restricted nor
committed. The Small Business Grants is a program the Village Council approved in the
prior fiscal year to provide matching grants of up to $7,500 for improvements to small
business properties.
• Unassigned fund balance is the residual fund balance classification for the general fund. It
is also used to report negative fund balances in other governmental funds.
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, deferred inflows and outflows, 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.
A. Budgetary 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
THE VILLAGE OF NORTH PALM BEACH, FLORIDA
Notes to the Basic Financial Statements
September 30, 2017
35
NOTE 2 – STEWARDSHIP, COMPLIANCE, AND ACCOUNTABILITY
A. Budgetary Data
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.
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 months of July, August and September, the Council holds public meetings to
obtain taxpayer comments.
• Upon completion of the public hearings and prior to October 1st, a final operating budget
is legally enacted through the passage of an ordinance. Estimated beginning fund
balances are considered in the budgetary process.
• Any change to the total fund 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 or contracts) outstanding at year end are reported assigned fund balance and do not
constitute expenditures or liabilities because the commitments will be reappropriated and
honored during the subsequent year. The General Fund had $755,276 and the Capital Projects
Fund had $378,979 in outstanding encumbrances at year-end.
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 1st of
each year during the budget process.
THE VILLAGE OF NORTH PALM BEACH, FLORIDA
Notes to the Basic Financial Statements
September 30, 2017
36
NOTE 2 – STEWARDSHIP, COMPLIANCE, AND ACCOUNTABILITY (Continued)
B. Property Taxes (Continued)
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, 2017, was 7.3300
($7.3300 for each $1,000 of assessed valuation).
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 1st 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, 2017, unpaid delinquent
taxes are not material and have not been recorded by the Village.
NOTE 3 – DEPOSITS AND INVESTMENTS
Deposits
As of September 30, 2017, the carrying amount of the Village’s deposits (including fiduciary
funds) was $5,937,978 and the bank balances totaled $6,260,920. 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 OF NORTH PALM BEACH, FLORIDA
Notes to the Basic Financial Statements
September 30, 2017
37
NOTE 3 – DEPOSITS AND INVESTMENTS (Continued)
A reconciliation of deposit and investments as shown on the statement of net position and
statement of fiduciary net position for the Village is as follows:
By Category:
Deposits $ 5,937,978
Petty cash 6,550
Investments 62,266,721
Total deposits and investments $68,211,249
Presented in the statement of net position
Governmental activities
Cash and cash equivalents $ 5,591,637
Restricted cash and cash equivalents 7,194,447
Investments 9,132,267
Restricted investments 7,500,000
Business-type activities
Cash and cash equivalents 532,451
Total statements of net position 29,950,802
Presented in the statement of fiduciary net
position
Pension trust funds
Cash and cash equivalents 587,598
Investments 37,305,445
Agency funds
Cash and cash equivalents 367,404
Total fiduciary funds 38,260,447
Total deposits and investments $68,211,249
Investments
The Village categorizes its investments according to the fair value hierarchy established GASB
Statement No. 72, Fair Value Measurement and Application. The hierarchy is based on valuation
inputs used to measure the fair value of the asset as follows: Level 1 inputs are quoted prices in
active markets for identical assets; Level 2 inputs are significant other observable inputs to
include quoted prices for similar assets in active and non-active markets; Level 3 inputs are
significant unobservable inputs.
THE VILLAGE OF NORTH PALM BEACH, FLORIDA
Notes to the Basic Financial Statements
September 30, 2017
38
NOTE 3 – DEPOSITS AND INVESTMENTS (Continued)
Investments (Continued)
The money market mutual funds consist of investments with financial institutions in open end,
institutional, money market funds complying with Securities and Exchange Commission (SEC)
Rule 2a7. Rule 2a7 allows SEC registered mutual funds to use amortized cost rather than fair
value to report net assets used to compute share prices if certain conditions are met. Those
conditions include restrictions on the types of investments held, restrictions on the term-to-
maturity of individual investments and the dollar-weighted average of the portfolio, requirements
for portfolio diversification, and requirements for divestiture considerations in the event of
security downgrades and defaults, and required actions if the fair value of the portfolio deviates
from amortized cost by a specified amount.
The Florida Education Investment Trust Fund (FEITF) and Florida PRIME are external
investment pools which meet the requirements with GASB Statement No. 79, Certain External
Investment Pools and Pool Participants, which allows reporting the investments at amortized
cost. For both funds as of September 30, 2017, there were no redemption fees or maximum
transaction amounts, or any other requirements that serve to limit a participant’s daily access to
100 percent of their account value. However, the Trustees of the funds can suspend the right of
withdrawal or postpone the date of payment if the Trustees determine that there is an emergency
that makes the sale of a Portfolio’s securities or determination of its net asset value not
reasonably practical.
Money market mutual funds, FEITF and Florida Prime are exempt from the GASB 72 fair value
hierarchy disclosures.
Equity securities, exchange traded funds, and mutual funds classified in Level 1 of the fair value
hierarchy are valued based on prices quoted in active markets for those securities. Debt
securities classified in level 2 of the fair value hierarchy are valued using a matrix pricing
technique. Matrix pricing values securities based on the securities relationship to benchmark
quoted prices.
The American Core Realty Fund, LLC is a diversified open-end commingled fund that invests
primarily in high quality core income-producing office, industrial, retail, and multi-family
properties. This fund is an alternative investment vehicle valued using the net asset value (NAV)
provided by the investment manager of this fund. The NAV is based on the value of the
underlying assets owned by the fund minus its liabilities and then divided by the number of
shares or percentage of ownership outstanding. The NAV’s unit price is quoted on a private
market that is not active. Investments valued at NAV are excluded from the fair value hierarchy
because the valuation is not based on actual market inputs but rather is quantified using the
fund’s reported NAV.
THE VILLAGE OF NORTH PALM BEACH, FLORIDA
Notes to the Basic Financial Statements
September 30, 2017
39
NOTE 3 – DEPOSITS AND INVESTMENTS (Continued)
Investments (Continued)
Redemptions from the fund may be made quarterly upon ten days’ notice. The units that are
subject to a redemption notice may be redeemed in full or in installments on a pro-rata basis as
funds become available for such redemptions and are subject to the availability of cash flow
arising from investment transactions, sales and other fund operations occurring in the normal
course of business. The fund is not required to liquidate or encumber assets or defer investments
in order to satisfy redemption requests.
The value of this alternative investment is not necessarily indicative of the amount that could be
realized in a current transaction. The fair value may differ significantly from the value that would
have been used had a ready market for the underlying fund existed, and the differences could be
material. Future confirming events will also affect the estimates of fair value and the effect of
such events on the estimated fair value could be material.
The Florida Education Investment Trust Fund – FEITF Term Series invests in highly rated
securities including U.S. Treasury securities, U.S. government agency securities, deposits
including certificates of deposit and commercial paper. Other securities permitted by the term
portfolio’s investment policy may include municipal obligations, repurchase agreements and
government money market funds. Securities are rated at least ‘A/F1’ by Fitch Ratings or
equivalent. The term portfolio is a fixed-rate, fixed-term portfolio with a maximum term of one
year. The term program is designed to meet the cash flow requirements of investors with the cash
flows from the portfolio. The maturity profile of the term portfolio is managed to meet preset
redemptions of the portfolio’s participants. Upon investing in the program, a participant selects a
planned maturity date on which the portfolio seeks to produce a share price of at least $1.00 for
the participant that redeems on said date. Participants may request premature redemption, but the
portfolio may charge significant penalties for any redemption prior to the agreed-upon
redemption date and net asset value may be more or less than $1.00 per share. Redemptions will
be made seven days after the request is received.
The Villages investment in FEITF Term Series matures October 6, 2017 and has a stated rate of
1.16%
This fund is an alternative investment vehicle valued using the net asset value (NAV) provided
by the investment manager of this fund. The NAV is based on the value of the underlying assets
owned by the fund minus its liabilities and then divided by the number of shares or percentage of
ownership outstanding. The NAV’s unit price is quoted on a private market that is not active.
Investments valued at NAV are excluded from the fair value hierarchy because the valuation is
not based on actual market inputs but rather is quantified using the fund’s reported NAV.
THE VILLAGE OF NORTH PALM BEACH, FLORIDA
Notes to the Basic Financial Statements
September 30, 2017
40
NOTE 3 – DEPOSITS AND INVESTMENTS (Continued)
Investments (Continued)
As of September 30, 2017, the Village held the following investments:
Weighted Fair Value Measurement
Average
Maturity Fair Value Level 1 Level 2
Governmental Funds
U.S. Government and Agency 2.05 Years $ 4,102,236 $ $ 4,102,236
Asset Backed Securities 3.47 Years 1,204,318 1,204,318
Municipal Bonds 1.75 Years 180,770 180,770
Domestic Corporate Bonds 1.69 Years 2,044,847 2,044,847
International Corporate Bonds 1.45 Years 1,474,345 1,474,345
Fiduciary Funds
U.S. Government and Agency 11.21Years 1,059,296 1,059,296
Asset Backed Securities 19.01 Years 932,191 932,191
Municipal Bonds 7.53 Years 311,950 311,950
Domestic Corporate Bonds 8.71 Years 2,801,318 2,801,318
International Corporate Bonds 7.15 Years 675,688 675,688
Domestic Common Equity
Securities N/A 10,757,817 10,757,817
International Common Equity
Securities N/A 2,393,230 2,393,230
Fixed Income ETF N/A 2,789,819 2,789,819
Equity ETF N/A 2,944,061 2,944,061
Fixed Income Mutual Funds N/A 2,640,119 2,640,119
Equity Mutual Funds N/A 6,462,257 6,462,257
42,774,262 $ 27,987,303 $ 14,786,959
Investments Reported at NAV
Governmental Funds
FEITF Term Series N/A 7,500,000
Fiduciary Funds
American Core Realty Fund N/A 2,386,295
Investments Reported at
Amortized Cost:
Governmental Funds
Money Market Mutual Funds N/A 125,751
Florida Prime 51 Days 519,961
FEITF 51 Days 7,524,123
Fiduciary Funds
Money Market Mutual Funds N/A 1,436,329
Total Investments $ 62,266,721
THE VILLAGE OF NORTH PALM BEACH, FLORIDA
Notes to the Basic Financial Statements
September 30, 2017
41
NOTE 3 – DEPOSITS AND INVESTMENTS (Continued)
Investments (Continued)
Credit risk – Credit risk is the risk that an issuer or other counter party to an investment will not
fulfill its obligations. The Village’s investment policies limit its investments to high quality
investments to control credit risk. The table below outlines the Village’s credit ratings for
investments with certain investments not specifically rated by both S&P and Moody’s.
S&P Moody’s Fair
Investments: Rating Rating Value
Governmental Funds
U.S. Government and Agency AA+ Aaa $ 4,102,236
Asset Backed Securities AAA Aaa 1,204,318
Municipal Bonds AA- Aa3 180,770
Domestic Corporate Bonds AAA to BBB+ Aaa to A3 2,044,847
International Corporate Bonds AAA to A- Aaa to A1 1,474,345
Money Market Mutual Funds NR NR 125,751
Florida Prime AAAm NR 519,961
FEITF AAAm NR 7,524,123
FEITF Term Series NR* NR 7,500,000
Fiduciary Funds
U.S. Government and Agency AA+ Aaa 1,059,296
Asset Backed Securities NR NR 932,191
Municipal Bonds AAA to AA- Aaa to Aa3 311,950
Domestic Corporate Bonds AAA to BBB- Aaa to Baa3 2,801,318
International Corporate Bonds AAA to A- Aaa to A1 675,688
Common Equity Securities NR NR 13,151,047
Exchange Traded Funds NR NR 5,733,880
Mutual Funds NR NR 9,102,376
American Core Realty Fund NR NR 2,386,295
Money Market Mutual Funds NR NR 1,436,329
Total Investments $ 62,266,721
* Rated AAAf by Fitch.
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.
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
THE VILLAGE OF NORTH PALM BEACH, FLORIDA
Notes to the Basic Financial Statements
September 30, 2017
42
NOTE 3 – DEPOSITS AND INVESTMENTS (Continued)
Investments (Continued)
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.
Custodial credit risk – 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 or collateral
securities that are in the possession of an outside party. The Village’s investments are held by a
third-party custodian, not in the name of the Village. Investments are held in book entry form at
the Federal Reserve by Depository Trust Company (DTC) via the custodian. The custodian
further segregates the Village’s investments in their trust accounting system. The investments in
mutual funds and investment partnerships are considered unclassified pursuant to the custodial
credit risk categories of GASB Statement No. 3, because they are not evidenced by securities
that exist in physical or book-entry form.
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 it
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.
Investing in Foreign Markets – Investing in foreign markets may involve special risks and
considerations not typically associated with investing in companies in the United States of
America. These risks include revaluation of currencies, high rates of inflation, repatriation
restrictions on income and capital, and future adverse political, social, and economic
developments. Moreover, securities of foreign governments may be less liquid, subject to
delayed settlements, taxation on realized or unrealized gains, and their prices are more volatile
than those of comparable securities in U.S. companies.
Investing in Real Estate. – The Village is subject to the risks inherent in the ownership and
operation of real estate. These risks include, among others, those normally associated with
changes in the general economic climate, trends in the industry including creditworthiness of
tenants, competition for tenants, changes in tax laws, interest rate levels, the availability of
financing and potential liability under environmental and other laws.
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 OF NORTH PALM BEACH, FLORIDA
Notes to the Basic Financial Statements
September 30, 2017
43
NOTE 3 – DEPOSITS AND INVESTMENTS (Continued)
Investments (Continued)
Authorized Investments (Continued)
The Village is authorized to invest its funds as follows:
1. Banks, Qualified Public Depositories with a collateral pledge level of twenty-five percent
or fifty percent;
2. U.S Treasury obligations and obligations the principal and interest of which are backed
or guaranteed by the full faith and credit of the U.S Government;
3. Debt obligations, participations or other instruments issued or fully guaranteed by any
U.S. Federal agency, instrumentality or government sponsored enterprise,
4. Supra-Nationals, U.S. dollar denominated debt obligations of a multilateral organization
of governments where the U.S. is a shareholder and voting member with a minimum
credit quality rating of A-1/P-1, AA-/Aa3 or equivalent,
5. U.S. dollar denominated corporate notes, bonds or other debt obligations issued or
guaranteed by a domestic or foreign corporation, financial institution, non-profit or other
entity with a minimum credit quality rating of A-1/P-1, A-/A3 or equivalent,
6. Obligations, including both taxable and tax - exempt, issued or guaranteed by any State,
territory or possession of the United States, political subdivision, public corporation,
authority, agency board, instrumentality or other unit of local government of any State or
territory with a minimum credit quality rating of SP-1/MIG 1, A-/A3 or equivalent,
7. Mortgage- backed securities (MBS), backed by residential, multi-family or commercial
mortgages, that are issued or fully guaranteed as to principal and interest by a U.S.
Federal agency or government sponsored enterprise, including but not limited to pass-
throughs, collateralized mortgage obligations (CMOs) and REMICs,
8. Asset-backed securities (ABS) whose underlying collateral consists of loans, leases or
receivables, including but not limited to auto loans /leases, credit card receivables,
student loans, equipment loans /leases, or home-equity loans with a minimum credit
quality rating of A-1/P-1, AAA/Aaa or equivalent,
9. U.S. dollar denominated commercial paper issued or guaranteed by a domestic or foreign
corporation, company, financial institution, trust or other entity, including both unsecured
debt and asset-backed programs with a minimum credit quality rating of A-1/P-1 or
equivalent,
10. Shares in open-end and no-load money market mutual funds, provided such funds are
registered under the Investment Company Act of 1940 and operate in accordance with
Rule 2a-7 with a minimum credit quality rating of AAAm/Aaa-mf or equivalent,
11. State, local government or privately- sponsored investment pools that are authorized
pursuant to state law with a minimum credit quality rating of AAAm/Aaa-mf or
equivalent.
THE VILLAGE OF NORTH PALM BEACH, FLORIDA
Notes to the Basic Financial Statements
September 30, 2017
44
NOTE 3 – DEPOSITS AND INVESTMENTS (Continued)
Investments (Continued)
Authorized Investments (Continued)
The Village General Employees’ Retirement Fund is authorized to invest its funds as follows:
1. Interest-bearing time deposits in qualified public depositories, as defined in Chapter 280,
Florida Statutes;
2. 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;
3. Securities and Exchange Commission registered money market funds with the highest
credit quality rating from a nationally recognized rating agency minimum credit quality
rating of A-1 from S&P or P-1 from Moody’s;
4. Obligations issued by the U.S. Government or obligations guaranteed by agencies or
instrumentalities of the U.S. Government;
5. Foreign Securities, including convertible bonds, convertible preferred issues and
preferred stock;
6. Equities, including publicly traded REITS, commodities, convertible bonds, convertible
preferred issues and preferred stock. Foreign security convertibles are limited to those
that settle in U.S. dollars and are traded on one or more of the nationally recognized
national exchanges.
7. Bonds 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 the issues are traded on any one (1)
or more of the recognized national stock exchanges or over the counter and holds a
minimum credit rating of BBB from S&P or Baa from Moody’s, except that up to 20% of
the fixed income portfolio may be held in securities that do not meet this criteria. The
weighted average quality rating of the portfolio will be A or better and the effective
duration of the portfolio shall be kept within 20% of Barclays Aggregate Index;
8. Comingled stock, bond or money market funds.
9. 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;
10. Other investments authorized by law or by ordinance by the Village.
THE VILLAGE OF NORTH PALM BEACH, FLORIDA
Notes to the Basic Financial Statements
September 30, 2017
45
NOTE 3 – DEPOSITS AND INVESTMENTS (Continued)
Investments (Continued)
Authorized Investments (Continued)
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 issued by the U.S. Government, or an agency or instrumentality of the U.S.
Government, as well as obligations guaranteed by agencies or instrumentalities of the
U.S. Government, including mortgage-related or asset-backed securities;
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. Notwithstanding 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;
5. Fixed income investments defined as preferred issues and fixed income securities
provided all issues shall meet or exceed S&P’s A or Moody’s A credit rating;
6. Money market funds, defined as fixed income securities having a maturity of less than
one year provided all issues shall meet or exceed S&P’s A1 or Moody’s P1 credit rating;
7. Bonds issued by the State of Israel;
8. Purchases in commingled real estate funds.
THE VILLAGE OF NORTH PALM BEACH, FLORIDA
Notes to the Basic Financial Statements
September 30, 2017
46
NOTE 4 – RECEIVABLES
Receivables at September 30, 2017, were as follows:
General
Fund
Country
Club
Utility franchise fees & taxes $ 387,234 $
Conroy Drive assessment 2,978
Other accounts receivable 52,474 11,741
Total accounts receivable $ 442,686 $ 11,741
NOTE 5 – CAPITAL ASSETS
Capital Assets activity for the year ended September 30, 2017, was as follows:
Primary Government
Governmental Activities:
Beginning
Balance Additions Deletions
Transfers
Ending
Balance
Capital assets not being depreciated:
Land $ 2,055,889 $ $
$
$ 2,055,889
Construction in progress 21,171 1,185,777 (35,963) 1,170,985
Capital assets being depreciated:
Buildings 9,413,835 27,849 (73,920) 9,367,764
Improvements 14,175,980 33,014 14,208,994
Machinery and equipment 3,219,818 25,368 (210,471) 3,034,715
Vehicles 4,671,505 670,644 (304,654) 5,037,495
Total at historical cost: 33,558,198 1,942,652 (625,008) 34,875,842
Less accumulated depreciation for:
Buildings (5,725,801) (259,887) 51,004 (5,934,684)
Improvements (8,646,130) (756,873) (9,403,003)
Machinery and equipment (2,027,824) (182,344) 210,470 (1,999,698)
Vehicles (3,055,896) (308,594) 304,656 (3,059,834)
Total accumulated depreciation (19,455,651) (1,507,698) 566,130 (20,397,219)
Governmental activities capital
assets, net $ 14,102,547 $ 434,954 $ (58,878)
$
$ 14,478,623
THE VILLAGE OF NORTH PALM BEACH, FLORIDA
Notes to the Basic Financial Statements
September 30, 2017
47
NOTE 5 – CAPITAL ASSETS (Continued)
Depreciation expense was charged to functions/programs of the primary government as follows:
Governmental activities:
General government $ 89,020
Public safety 386,727
Public works 558,630
Community development 22,523
Leisure services 450,798
Total depreciation expense, governmental activities $ 1,507,698
Business-type activities:
Beginning
Balance Additions Deletions
Transfers
Ending
Balance
Capital assets not being depreciated:
Land $ 1,051,311 $ $ $ $ 1,051,311
Construction in progress 227,818 227,818
Capital assets being depreciated:
Buildings 1,405,035 1,405,035
Improvements 6,146,307 6,146,307
Machinery and equipment 244,567 244,567
Vehicles 63,700 63,700
Total at historical cost: 9,138,738 9,138,738
Less accumulated depreciation for:
Buildings (1,089,113) (23,883) (1,112,996)
Improvements (3,206,878) (294,210) (3,501,088)
Machinery and equipment (222,197) (4,915) (227,112)
Vehicles (55,216) (4,070) (59,286)
Total accumulated depreciation (4,573,404) (327,078) (4,900,482)
Business-type activities capital
assets, net $ 4,565,334 $ (327,078) $
$
$ 4,238,256
Contract Commitments
Commitments relating to the new country club clubhouse are $207,752 relating to the design and
$300,768 relating to construction of temporary facilities. There also was a contract for $270,000
for the purchase of a new sanitation truck.
THE VILLAGE OF NORTH PALM BEACH, FLORIDA
Notes to the Basic Financial Statements
September 30, 2017
48
NOTE 6 – LONG TERM LIABILITIES
Change in Long-Term Liabilities
Long-term liability activity for the year ended September 30, 2017, was as follows:
Beginning
Balance Additions Reductions
Ending
Balance
Amount
Due
Within
One Year
Governmental activities:
Loans payable $ $ 15,000,000 $ $ 15,000,000 $ 680,000
Claims and settlements 50,000 (50,000)
OPEB (see Note 13) 2,476,294 258,450 2,734,744
Net pension liability
(see Note 8) 6,583,056 (933,467) 5,649,589
Compensated absences
payable 1,195,896 1,094,316 (954,431) 1,335,781 984,297
Total $ 10,305,246 $ 16,352,766 $(1,937,898) $ 24,720,114 $ 1,664,297
Business-type activities:
Loans payable $ 2,684,913 $ $ (437,825) $ 2,247,088 $ 307,719
OPEB (see Note 13) 112,021 7,418 119,439
Compensated absences
payable 60,537 11,112
(46,770) 24,879 18,100
Total $ 2,857,471 $ 18,530 $ (484,595) $ 2,391,406 $ 325,819
Governmental activities other postemployment benefit obligations, compensated absences and
net pension liabilities are expected to be paid out of the general fund.
THE VILLAGE OF NORTH PALM BEACH, FLORIDA
Notes to the Basic Financial Statements
September 30, 2017
49
NOTE 6 – LONG TERM LIABILITIES (Continued)
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, 2017, the
principal amount outstanding was $2,247,088 and was for the purpose of business-type activities.
Annual debt service requirements to maturity are as follows:
Business-type activities:
Year Ending Principal Interest Total
2018 $ 307,719 $ 90,440 $ 398,159
2019 320,677 77,482 398,159
2020 333,990 64,169 398,159
2021 348,241 49,918 398,159
2022 362,904 35,255 398,159
2023 - 2024 573,557 24,048 597,605
$ 2,247,088 $ 341,312 $ 2,588,400
Non-Ad Valorem Revenue Notes, Series 2017
The Village Council adopted Resolution No. 2017-22 authorizing the issuance of Non-Ad
Valorem Revenue Notes, Series 2017, in one or more Series in the aggregate Principal amount
not to exceed $15,000,000 to finance the cost of constructing and equipping a new country club
clubhouse. The Notes are secured by a covenant to budget and appropriate legally available non-
ad valorem revenues of the Village.
Series 2017A
The Series 2017A is a tax-exempt issuance for $8,900,000 with an interest rate of 3.19%, which
is subject to adjustment in the event of taxability of the interest on this note. Interest is payable
on June 1 and December 1 of each year beginning December 1, 2017. Principal payments start
June 1, 2025 with the final payment on June 1, 2032. This note may be prepaid in whole but not
in part at any time after June 1, 2025, at a redemption price equal to 100% of the principal
amount outstanding plus accrued interest through the redemption date. As of September 30,
2017, the principal amount outstanding was $8,900,000 and was for the purpose of
governmental-type activities.
THE VILLAGE OF NORTH PALM BEACH, FLORIDA
Notes to the Basic Financial Statements
September 30, 2017
50
NOTE 6 – LONG TERM LIABILITIES (Continued)
Non-Ad Valorem Revenue Note, Series 2017 (Continued)
Series 2017B
The Series 2017B is a taxable issuance for $6,100,000 with an interest rate of 3.78%. Interest is
payable on June 1 and December 1 of each year beginning December 1, 2017. Principal
payments start June 1, 2018 with the final payment on June 1, 2025. This note may not be
prepaid. As of September 30, 2017, the principal amount outstanding was $6,100,000 and was
for the purpose of governmental-type activities.
Annual debt service requirements to maturity for the Series 2017A and 2017B are as follows:
Year Ending Principal Interest Total
2018 $ 680,000 $ 558,684 $ 1,238,684
2019 805,000 488,786 1,293,786
2020 835,000 458,357 1,293,357
2021 865,000 426,794 1,291,794
2022 900,000 394,097 1,294,097
2023 - 2027 5,020,000 1,450,327 6,470,327
2028 - 2032 5,895,000 576,115 6,471,115
$ 15,000,000 $ 4,353,160 $ 19,353,160
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. In the fiscal year ending September 30, 2014, SERMA was dissolved and
the outstanding claims were transferred to the Village’s current workman’s compensation
administrator. As part of the dissolution, the Village received $61,100 from SERMA as its
portion of the claims reserve balance, this was recorded as an accrued liability in the General
Fund. At this time, the Village believes that the $61,100 recorded in the General Fund is
adequate to cover the outstanding claims. The $50,000 recognized as a long-term claim in prior
years was recognized as income in the current year.
THE VILLAGE OF NORTH PALM BEACH, FLORIDA
Notes to the Basic Financial Statements
September 30, 2017
51
NOTE 7 – 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.
The Village is covered by Florida Statutes under the Doctrine of Sovereign Immunity which
effectively limits the amount of liability of municipalities to individual claims of
$200,000/$300,000 for all claims relating to the same incident. However, under certain
circumstances, a plaintiff can seek to recover damages in excess of statutory limits by
introducing a claims bill to the Florida Legislature. The limits addressed in Florida Statutes do
not apply to claims filed in federal courts.
There have been no significant reductions in insurance coverage in the prior year. No
settlements exceeded insurance coverage for the past three years.
NOTE 8 – 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 (F&P), covering firefighters and police
officers, and Village of North Palm Beach General Employees Retirement Fund (GERF),
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 issued
separate stand-alone financial statements for the year ended September 30, 2017, the report may
be obtained from the Village Clerk, at the Village of North Palm Beach, 501 U.S. Highway 1,
North Palm Beach, Florida 33408. The General Employees Plan does not issue separate
financial statements.
Each plan has its own board that acts as plan administrator and trustee: The Fire and Police
Retirement Fund Board of Trustees consists of five members (5); four (4) of whom were elected
by a majority of the members of the plan. Two (2) of the elected members are certified
firefighters of the Village and two (2) are certified police officers of the Village. The fifth
member of the board is a legal resident of the Village and is appointed by the Village council.
The General Employees Retirement Board consists of five members (5); two (2) of whom were
employees elected by a majority of the members of the plan, two (2) of the members is a legal
resident of the Village and appointed by the Village council, the two (2) council appointed
members of the Board shall appoint a member of the general public who has never been
employed by the Village to serve as the fifth member of the 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.
THE VILLAGE OF NORTH PALM BEACH, FLORIDA
Notes to the Basic Financial Statements
September 30, 2017
52
NOTE 8 – EMPLOYEE RETIREMENT PLANS (Continued)
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
All Retirement Plans
Basis of Accounting. The retirement plans are reported on the accrual basis of accounting. The
plans’ fiduciary net position have been determined on the same basis used by the pension plans.
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.
Investments Concentrations. There were no investments representing concentrations of 5% or
more of net plan assets in investments that are not issued or guaranteed by the U.S. government.
PLAN DESCRIPTION, INVESTMENT AND CONTRIBUTION INFORMATION
The following schedule is provided for general information purposes only and is derived from
the respective actuarial reports and Village information for the two retirement plans. Plan
participants should refer to the appropriate source documents for more complete information on
the plans.
General Employees’ Fire and Police
Plan Description:
Authority Village Ordinance Village Ordinance/State
Asset Valuation:
Reporting Fair Value Fair Value
Legal Reserves None None
Long-Term Receivable None None
Internal/Participant Loans None None
Membership of each plan consisted of the following at October 1, 2016:
GERF F&P
Inactive Plan Members or Beneficiaries
currently receiving benefits 31 25
Inactive Plan Members entitled to but
not yet receiving benefits 39 12
Active Plan Members 36 53
Total 106 90
THE VILLAGE OF NORTH PALM BEACH, FLORIDA
Notes to the Basic Financial Statements
September 30, 2017
53
NOTE 8 – EMPLOYEE RETIREMENT PLANS (Continued)
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. 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.
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 the
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.
THE VILLAGE OF NORTH PALM BEACH, FLORIDA
Notes to the Basic Financial Statements
September 30, 2017
54
NOTE 8 – EMPLOYEE RETIREMENT PLANS (Continued)
General Employees' Retirement System (Continued)
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.
"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.
Asset Allocation. The plan’s adopted asset allocation policy as of September 30, 2017, is as
follows:
Asset Class Target Allocation
Domestic equity 45%
International equity 15
Domestic bonds 40
Total 100%
Rate of Return. For the year ended September 30, 2017, the annual money-weighted rate of
return on Pension Plan investments, net of pension plan investment expense, was 11.32 percent.
The money-weighted rate of return expresses investment performance, net of investment
expense, adjusted for the changing amounts actually invested.
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.
THE VILLAGE OF NORTH PALM BEACH, FLORIDA
Notes to the Basic Financial Statements
September 30, 2017
55
NOTE 8 – EMPLOYEE RETIREMENT PLANS (Continued)
Fire and Police 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.
2015-05. 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 1st 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, 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.
Asset Allocation. The plan’s adopted asset allocation policy as of September 30, 2017, is as
follows:
Asset Class Target Allocation
Domestic equity 50%
International equity 10
Domestic bonds 30
Real estate 10
Total 100%
Rate of Return. For the year ended September 30, 2017, the annual money-weighted rate of
return on Pension Plan investments, net of pension plan investment expense, was 10.92 percent.
The money-weighted rate of return expresses investment performance, net of investment
expense, adjusted for the changing amounts actually invested.
THE VILLAGE OF NORTH PALM BEACH, FLORIDA
Notes to the Basic Financial Statements
September 30, 2017
56
NOTE 8 – EMPLOYEE RETIREMENT PLANS (Continued)
Fire and Police Retirement System
Contributions. Firefighter members are required to contribute 3.50% from April 1, 2015 to
March 31, 2016 and 5.00% thereafter of their basic compensation to the plan. Non-collectively
bargained Police Officer are required to contribute 2% their basic compensation. Collectively
bargained Police Officer members are required to contribute 4.00% 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 approved 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 $310,200 during the fiscal year ended September 30, 2017.
All Retirement Plans
Net Pension Liability. The components of net pension liability of the Village on September 30,
2017 were as follows:
General
Employees
Fire and
Police
Total pension liability $ 17,201,122 $ 24,646,485
Plan fiduciary net position (15,148,684) (22,855,799)
Village's net pension liability $ 2,052,438 $ 1,790,686
Plan fiduciary net position as a
percentage of total pension liability 88.07% 92.73%
The pension liability of the General Employees plan increased by $23,053 due a change in the
mortality rates.
The pension liability of the Fire and Police plan increased by a net of $198,680 due to
assumptions changes in the investment rate of return and mortality rates.
THE VILLAGE OF NORTH PALM BEACH, FLORIDA
Notes to the Basic Financial Statements
September 30, 2017
57
NOTE 8 – EMPLOYEE RETIREMENT PLANS (Continued)
All Retirement Plans
Actuarial Assumptions. The total pension liability was determined by an actuarial valuation as
of October 1, 2016 updated to September 30, 2017 using the following actuarial assumptions
applied to the September 30, 2017 measurement period.
General Employees Fire and Police
Inflation 2.75% 2.50%
Salary increases Service based Service based
Investment rate of return 6.75% 7.80%
Mortality RP2000 Combined
Healthy Participant,
Scale BB.
Female: 100%
Annuitant White
Collar,
Male Annuitant White
Collar/50% Annuitant
Blue Collar
Female: RP2000
Generational,
100%Annuitant White
Collar, Scale BB
Male: RP2000
Generational,
10%Annuitant White
Collar/90% Annuitant
Blue Collar, Scale BB
The long-term expected rate of return on pension plan investments was determined using a
building-block method in which best-estimate ranges of expected future real rates of return
(expected returns, net of pension plan investment expenses and inflation) are developed for each
major asset class. These ranges are combined to produce the long-term expected rate of return
by weighting the expected future real rates of return by the target asset allocation percentage and
by adding expected inflation. Best estimates of arithmetic real rates of return for each major
asset class included the pension plan’s target asset allocation as of September 30, 2017, are
summarized in the following table:
Asset Class
Long-Term Expected Real Rate of
Return
General
Employees
Fire and
Police
Domestic equity 6.50% 7.50%
International equity 6.75% 8.50%
Domestic bonds 2.25% 2.50%
Real estate N/A 4.50%
THE VILLAGE OF NORTH PALM BEACH, FLORIDA
Notes to the Basic Financial Statements
September 30, 2017
58
NOTE 8 – EMPLOYEE RETIREMENT PLANS (Continued)
All Retirement Plans
Discount Rate. The discount rate used to measure the total pension liability was 6.75 percent for
the General Employees Retirement Fund and 7.80 percent for the Fire and Police Retirement
Fund. The projection of cash flows used to determine the discount rates assumed that plan
member contributions will be made at the current contribution rate and that sponsor contributions
will be made at rates equal to the difference between actuarially determined contribution rates
and the member rate. Based on those assumptions, the pension plans’ fiduciary net position was
projected to be available to make all projected future benefit payments of current plan members.
Therefore, the long-term expected rate of return on pension plan investments was applied to all
periods of projected benefit payments to determine the total pension liability.
Sensitivity of the Net Pension Liability to Changes in the Discount Rate. The following
presents the net pension liabilities of the Village, calculated using the discount rates above, as
well as what the Village’s net pension liabilities would be if it were calculated using a discount
rate that is one percentage-point lower or one percentage-point higher than the current rate.
General Employees' Retirement System
Current
Discount
1% Decrease Rate 1% Increase
5.75% 6.75% 7.75%
Village's net pension liability $ 4,561,024 $ 2,052,438 $ (9,258)
Fire and Police Retirement System
Current
Discount
1% Decrease Rate 1% Increase
6.80% 7.80% 8.80%
Village's net pension liability $ 5,352,774 $ 1,790,686 $ (1,125,716)
All Retirement Plans
The Village’s total pension liability, plan fiduciary net position, net pension liability, pension
related deferred outflows and inflows, and pension expense for the fiscal year ended September
30, 2017, are reported using a measurement date of September 30, 2016.
THE VILLAGE OF NORTH PALM BEACH, FLORIDA
Notes to the Basic Financial Statements
September 30, 2017
59
NOTE 8 – EMPLOYEE RETIREMENT PLANS (Continued)
All Retirement Plans
Actuarial Assumptions. The total pension liability was determined by an actuarial valuation as
of October 1, 2015 updated to September 30, 2016 using the following actuarial assumptions
applied to the September 30, 2016, measurement period.
General Employees Fire and Police
Inflation 2.75% 2.50%
Salary increases Service based Service based
Investment rate of return 6.75% 7.85%
Mortality
Female: RP2000,
100%Annuitant White
Collar, Scale BB
Male: RP2000,
50%Annuitant White
Collar/50% Annuitant
Blue Collar, Scale BB
Female: RP2000
Generational,
100%Annuitant White
Collar, Scale BB
Male: RP2000
Generational,
10%Annuitant White
Collar/90% Annuitant
Blue Collar, Scale BB
The long-term expected rate of return on pension plan investments was determined using a
building-block method in which best-estimate ranges of expected future real rates of return
(expected returns, net of pension plan investment expenses and inflation) are developed for each
major asset class. These ranges are combined to produce the long-term expected rate of return
by weighting the expected future real rates of return by the target asset allocation percentage and
by adding expected inflation. Best estimates of arithmetic real rates of return for each major
asset class included the pension plan’s target asset allocation as of September 30, 2016, are
summarized in the following table:
Asset Class
Target
Allocation
Long-Term Expected Real
Rate of Return
General
Employees
Fire and
Police
General
Employees
Fire and
Police
Domestic equity 45% 50% 6.75% 7.50%
International equity 15 10 6.75% 8.50%
Domestic bonds 40 30 2.00% 2.50%
Real estate N/A 10 N/A 4.50%
Total 100% 100%
THE VILLAGE OF NORTH PALM BEACH, FLORIDA
Notes to the Basic Financial Statements
September 30, 2017
60
NOTE 8 – EMPLOYEE RETIREMENT PLANS (Continued)
All Retirement Plans
Discount Rate. The discount rate used to measure the total pension liability was 6.75 percent for
the General Employees Retirement Fund and 7.85 percent for the Fire and Police Retirement
Fund. The projection of cash flows used to determine the discount rates assumed that plan
member contributions will be made at the current contribution rate and that sponsor contributions
will be made at rates equal to the difference between actuarially determined contribution rates
and the member rate. Based on those assumptions, the pension plans’ fiduciary net position was
projected to be available to make all projected future benefit payments of current plan members.
Therefore, the long-term expected rate of return on pension plan investments was applied to all
periods of projected benefit payments to determine the total pension liability.
General Employees' Retirement System
Changes in Net Pension Liability
Using a measurement date of September 30, 2016, the components of the net pension liability
reported by the Village at September 30, 2017, were as follows:
Total Fiduciary Net
Pension Net Pension
Description
Liability
(a)
Position
(b)
Liability
(a)-(b)
Balances at September 30, 2015 $ 14,556,047 $ 12,109,145 $ 2,446,902
Changes due to:
Service cost 357,344 357,344
Interest 1,106,085 1,106,085
Difference between expected
and actual experience (129,381) (129,381)
Changes of Assumptions 928,295 928,295
Employer contributions 458,615 (458,615)
Employee contributions 126,947 (126,947)
Benefit payments and refunds (331,174) (331,174)
Net investment income 1,161,530 (1,161,530)
Administrative expenses (24,794) 24,794
Total changes 1,931,169 1,391,124 540,045
Balances at September 30, 2016 $ 16,487,216 $ 13,500,269 $ 2,986,947
THE VILLAGE OF NORTH PALM BEACH, FLORIDA
Notes to the Basic Financial Statements
September 30, 2017
61
NOTE 8 – EMPLOYEE RETIREMENT PLANS (Continued)
General Employees' Retirement System (Continued)
The pension liability increased by a net of $928,295 due to assumption changes in the discount
rate, investment rate of return, inflation rate, salary scale, and the withdrawal and mortality rates.
Sensitivity of the Net Pension Liability to Changes in the Discount Rate
Current
Discount
1% Decrease Rate 1% Increase
5.75% 6.75% 7.75%
Village's net pension liability $ 5,436,118 $ 2,986,947 $ 972,220
Pension expense and deferred outflows and inflows of resources
For the fiscal year ended September 30, 2017, the Village recognized pension expense of
$777,854. In addition, the Village reported deferred outflows of resources and deferred inflows
of resources related to the Plan from the following sources:
Deferred Deferred
Outflows Inflows
Description of Resources of Resources
Net difference between projected and actual
earnings on plan investments $ 600,710 $ 378,570
Differences between expected and actual
experience 168,479
Assumption changes 596,761
Village plan contributions subsequent
to the measurement date 527,617
Total $ 1,725,088 $ 547,049
THE VILLAGE OF NORTH PALM BEACH, FLORIDA
Notes to the Basic Financial Statements
September 30, 2017
62
NOTE 8 – EMPLOYEE RETIREMENT PLANS (Continued)
General Employees' Retirement System (Continued)
Pension expense and deferred outflows and inflows of resources (Continued)
The deferred outflows of resources totaling $527,617 resulting from Village contributions to the
plan subsequent to the measurement date, will be recognized as a reduction of the net pension
liability in the fiscal year ended September 30, 2017. Other amounts reported as deferred
outflows of resources and deferred inflows of resources related to the plan will be recognized in
pension expense as follows:
Year ended September 30: Amount
2018 $ 278,255
2019 306,496
2020 132,953
2022 (67,282)
2022
Thereafter
$ 650,422
Fire and Police Retirement System
Sensitivity of the Net Pension Liability to Changes in the Discount Rate
Current
Discount
1% Decrease Rate 1% Increase
6.85% 7.85% 8.85%
Village's net pension liability $ 5,938,411 $ 2,662,642 $ (17,797)
THE VILLAGE OF NORTH PALM BEACH, FLORIDA
Notes to the Basic Financial Statements
September 30, 2017
63
NOTE 8 – EMPLOYEE RETIREMENT PLANS (Continued)
Fire and Police Retirement System (Continued)
Changes in Net Pension Liability
Using a measurement date of September 30, 2016, the components of the net pension liability
reported by the Village at September 30, 2017, were as follows:
Total Fiduciary Net
Pension Net Pension
Description
Liability
(a)
Position
(b)
Liability
(a)-(b)
Balances at September 30, 2015 $ 21,852,818 $ 17,716,664 $ 4,136,154
Changes due to:
Service cost 833,909 833,909
Interest 1,738,069 1,738,069
Change in excess state money 79,505 79,505
Differences between expected
and actual experience (31,422) (31,422)
Change of Assumptions (1,223,780) (1,223,780)
Employer contributions 969,836 (969,836)
Employer contributions-state 310,200 (310,200)
Employee contributions 190,989 (190,989)
Employee contributions buy back 7,609 7,609
Benefit payments and refunds (653,993) (653,993)
Net investment income 1,475,735 (1,475,735)
Administrative expenses (76,967) 76,967
Total changes 749,897 2,223,409 (1,473,512)
Balances at September 30, 2016 $ 22,602,715 $ 19,940,073 $ 2,662,642
The pension liability of the Fire and Police plan decreased by a net of $1,223,780 due to
assumptions changes in the salary scale, normal retirement rates, discount rate, investment rate of
return, withdrawal and mortality rates, and the actuarial cost method.
THE VILLAGE OF NORTH PALM BEACH, FLORIDA
Notes to the Basic Financial Statements
September 30, 2017
64
NOTE 8 – EMPLOYEE RETIREMENT PLANS (Continued)
Fire and Police Retirement System (Continued)
Pension expense and deferred outflows and inflows of resources
For the fiscal year ended September 30, 2017, the Village recognized pension expense of
$1,269,751. In addition, the Village reported deferred outflows of resources and deferred
inflows of resources related to the Plan from the following sources:
Deferred Deferred
Outflows Inflows
Description of Resources of Resources
Net difference between projected and actual
earnings on plan investments $ 601,141 $
Differences between expected and actual
experience 322,127 27,930
Change of assumptions 140,656 1,087,805
Village plan contributions subsequent
to the measurement date 1,255,018
Total $ 2,318,942 $ 1,115,735
The deferred outflows of resources totaling $1,255,018 resulting from Village contributions to
the plan subsequent to the measurement date, will be recognized as a reduction of the net pension
liability in the fiscal year ended September 30, 2017. Other amounts reported as deferred
outflows of resources and deferred inflows of resources related to the plan will be recognized in
pension expense as follows:
Year ended September 30: Amount
2018 $ 161,441
2019 161,442
2020 216,262
2021 (33,088)
2022 (139,467)
Thereafter (418,401)
$ (51,811)
THE VILLAGE OF NORTH PALM BEACH, FLORIDA
Notes to the Basic Financial Statements
September 30, 2017
65
NOTE 8 – EMPLOYEE RETIREMENT PLANS (Continued)
All Retirement Plans
Summarized information
The Village’s total pension liability, plan fiduciary net position, net pension liability, pension
related deferred outflows and inflows, and pension expense for the fiscal year ended September
30, 2017, using a measurement date of September 30, 2016, are as follows:
General
Employees
Fire and
Police Total
Total pension liability $ 16,487,216 $ 22,602,715 $ 39,089,931
Plan fiduciary net position 13,500,269 19,940,073 33,440,342
Net pension liability 2,986,947 2,662,642 5,649,589
Deferred outflows of resources 1,725,088 2,318,942 4,044,030
Deferred inflows of resources 547,049 1,115,735 1,662,784
Pension expense 777,854 1,269,751 2,047,605
Accounts Payable 422 15,663 16,085
NOTE 9 – ON-BEHALF PAYMENTS
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, 2017, $309,138 was recorded as revenues and expenditures in the On-Behalf Pension
Contribution Special Revenue Fund relating to on-behalf payments received from the state.
THE VILLAGE OF NORTH PALM BEACH, FLORIDA
Notes to the Basic Financial Statements
September 30, 2017
66
NOTE 10 – 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 as of
September 30, 2017, is presented below.
STATEMENT OF FIDUCIARY NET POSITION
General
Employees’
Pension
Assets
Cash and cash equivalents $ 284,925
Investments:
Fixed income exchange traded funds 2,789,819
Equity exchange traded funds 2,944,061
Fixed income mutual funds 2,640,119
Equity mutual funds 6,462,257
Accrued dividends and interest 5,596
Accounts receivable 45,599
Total assets 15,172,376
Liabilities
Accounts payable 23,692
Net position
Held in trust for pension benefits and
other purposes
$ 15,148,684
THE VILLAGE OF NORTH PALM BEACH, FLORIDA
Notes to the Basic Financial Statements
September 30, 2017
67
NOTE 10 – PENSION PLAN FINANCIAL INFORMATION (Continued)
STATEMENT OF CHANGES IN FIDUCIARY NET POSITION
General
Employees’
Pension
Additions
Contributions
Employer $ 527,617
Plan members 110,417
Total contributions 638,034
Investment earnings
Dividends and interest 374,112
Net (decrease) in the fair value
of investments 1,157,744
Less investment expense (44,543)
Total investment earnings 1,487,313
Total additions 2,125,347
Deductions
Administration 22,361
Termination refunds 13,492
Benefits 441,079
Total deductions 476,932
Change in net position 1,648,415
Net position - beginning 13,500,269
Net position - ending $ 15,148,684
NOTE 11 – DEFINED CONTRIBUTION PLAN
Effective October 1, 2006, all employees of the Village may participate in one of four 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 Village Manger,
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. If an employee terminates before becoming fully vested, forfeited amounts
will be used to reduce future Village contributions. No loans are permitted by the plan.
THE VILLAGE OF NORTH PALM BEACH, FLORIDA
Notes to the Basic Financial Statements
September 30, 2017
68
NOTE 11 – DEFINED CONTRIBUTION PLAN (Continued)
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, 2017, is listed below:
Village
Manager
Directors
General
Employees
Municipal
Employees
Employee contributions $ 4,583 $ 38,321 $ 46,537 $ 55,778
Village pension expense 14,123 86,407 155,467 139,747
Forfeitures - 12,079 14,594 9,825
Payable as of fiscal year end - - - -
NOTE 12 – 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
party 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.
THE VILLAGE OF NORTH PALM BEACH, FLORIDA
Notes to the Basic Financial Statements
September 30, 2017
69
NOTE 12 – DEFERRED COMPENSATION PLAN ASSETS (Continued)
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 13 – OTHER POSTEMPLOYMENT 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 position/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 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 VILLAGE OF NORTH PALM BEACH, FLORIDA
Notes to the Basic Financial Statements
September 30, 2017
70
NOTE 13 – OTHER POST EMPLOYMENT BENEFITS (Continued)
Annual OPEB Cost and Net OPEB Obligation (Continued)
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 $ 234,470
Amortization 166,502
Interest 16,039
Annual required contribution (ARC) 417,011
Interest on net unfunded OPEB obligation 103,533
Adjustment to ARC (149,682)
Annual OPEB cost 370,862
Contributions made (104,994)
Increase in net OPEB obligation 265,868
Net OPEB obligation October 1, 2016 2,588,315
Net OPEB obligation September 30, 2017 $ 2,854,183
Trend Information
Three-Year Trend Information
Percentage of
Fiscal Annual Annual Net
Year OPEB OPEB Cost OPEB
End Cost Contributed Obligation
09/30/15 $329,436 19.3% $2,306,807
09/30/16 $350,729 19.7% $2,588,315
09/30/17 $370,862 28.3% $2,854,183
Funded Status
The funded status of the plan as of most recent actuarial valuation date was as follows:
Actuarial valuation date 10/01/2014
Actuarial accrued liability $2,464,468
Actuarial value of plan assets $
Unfunded actuarial accrued liability (UAAL) $2,464,468
Funded ratio 0.0%
Covered payroll $8,675,270
UAAL as a percentage of covered payroll 28.4%
THE VILLAGE OF NORTH PALM BEACH, FLORIDA
Notes to the Basic Financial Statements
September 30, 2017
71
NOTE 13 – OTHER POST EMPLOYMENT BENEFITS (Continued)
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
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 10/01/2014
Actuarial cost method Projected Unit Credit
Amortization method Level dollar, 30 Years, open
Remaining amortization period 30 years
Asset valuation method Unfunded
Actual assumptions:
Investment rate of return 4%
Inflation rate 3%
Healthcare cost trend 9% for 2017 decreasing to 5% in 2024
NOTE 14 – 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 $192,088 to
Seacoast during the fiscal year for water and sewer service.
THE VILLAGE OF NORTH PALM BEACH, FLORIDA
Notes to the Basic Financial Statements
September 30, 2017
72
NOTE 15 –TRANSFERS
Interfund transfers during the year ended September 30, 2017, are as follows:
The $14,363,587 from the General Fund to the Capital Projects Fund and $53,082 from the
Capital Projects Fund to the General Fund to fund capital projects according to the original
budget and subsequent budget amendments.
NOTE 16 – CONTRACTS, COMMITMENTS AND CONTINGENCIES
Operating Lease
The Village entered into a three-year operating agreement for 80 golf carts, including GPS
systems and software, for the Country Club in December 2015. For the fiscal year ended
September 30, 2017 expenses under the lease were $110,682. Future minimum rental
commitments are as follows:
Year ended September 30: Amount
2018 $ 147,576
2019 36,894
$ 184,470
Commitments
On September 17, 2014, the Village entered into an agreement with the City of Palm Beach
Gardens whereby the City of Palm Beach Gardens will provide the Village public safety dispatch
services. The term of the agreement was for two years beginning on October 1, 2014, and
extending through September 30, 2016. In 2016 the agreement was renewed for an additional
five years extending through September 30, 2021. The fee for each year under the contract will
be based upon the budget of the North County Dispatch (NCDC) center prorated to each
contracting municipality based on that municipalities cost share. If at the end any contract year a
budget shortfall exists, each contracting municipality shall pay its share of the shortfall.
Conversely, if at the end of any contract year a budget surplus exists, such surplus shall represent
a committed fund balance to be utilized specifically for NCDC budgetary purposes. The
Village’s estimated cost for fiscal year ending September 30, 2017 is $381,960.
THE VILLAGE OF NORTH PALM BEACH, FLORIDA
Notes to the Basic Financial Statements
September 30, 2017
73
NOTE 16 – CONTRACTS, COMMITMENTS AND CONTINGENCIES (Continued)
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 17 – SUBSEQUENT EVENTS
Commitments
Subsequent to September 30, 2017, the Village approved the purchase of three sanitation
collection vehicles for $127,665, five vehicles for the police and fire rescue departments for
$206,339, $341,748 for additional architectural and design services for the new country club
clubhouse, $150,000 for consulting services to Land Development Code to implement the
Village Master Plan, $384,688 for roadway milling and resurfacing, $100,000 for the preparation
of a plan, contractor documents, and oversight of the Village’s Golf Course Renovation Project,
$146,600 for Lighthouse Drive bridge repairs, and amended the construction management
contract for the clubhouse adding an additional $286,606 for a total cost of $339,356.
NOTE 18 – 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 June 2015 the GASB issued Statement No. 75, Accounting and Financial Reporting for
Postemployment Benefits Other Than Pensions. This Statement improves accounting and
financial reporting by state and local governments for postemployment benefits other than
pensions. It also improves information provided by state and local governmental employers
about financial support for OPEB that is provided by other entities. This Statement is effective
for the fiscal year ending September 30, 2018.
Management is currently evaluating the impact of the adoption of this statement on the Village’s
financial statements.
REQUIRED SUPPLEMENTARY INFORMATION OTHER THAN MD&A
Actuarial UAAL as a
Actuarial Accrued Unfunded Percentage
Actuarial Value of Liability AAL Funded Covered of Covered
Valuation Assets (AAL) (1)(UAAL)Ratio Payroll Payroll
Date (a)(b)(b-a)(a/b)(c)((b-a)/c)
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%
10/01/14 $ 2,464,468$ 2,464,468$ 0.0%8,675,270$ 28.4%
(1) Projected unit credit
The schedule of funding progress presented above presents 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.
THE VILLAGE OF NORTH PALM BEACH, FLORIDA
Required Supplemental Information
September 30, 2017
Schedule of Funding Progress
Other Postemployment Benefits (OPEB)
74
FIDUCIARY FUNDS
Pension Trust Funds
General Employees Pension Trust Fund
Fire and Police Officers Pension Trust Fund
2014 2015 2016 2017
Total pension liability:
Service cost 374,926$ 317,676$ 357,344$ 275,504$
Interest 972,865 1,048,746 1,106,085 1,116,142
Differences between Expected and
Actual Experience (329,040) (129,381) (246,222)
Assumption changes 928,295 23,053
Benefit payments, including
refunds of employee contributions (263,674) (293,890) (331,174) (454,571)
Net change in total pension liability 1,084,117 743,492 1,931,169 713,906
Total pension liability - beginning 12,728,438 13,812,555 14,556,047 16,487,216
Total pension liability - ending (a)13,812,555$ 14,556,047$ 16,487,216$ 17,201,122$
Plan fiduciary net position
Contributions - employer 562,953$ 464,189$ 458,615$ 527,617$
Contributions - Employees 142,609 125,738 126,947 110,417
Net investment income 1,072,009 (96,116) 1,161,530 1,487,313
Benefit payments, including
refunds of employee contributions (263,674) (293,890) (331,174) (454,571)
Administrative expenses (17,171) (20,655) (24,794) (22,361)
Net change in plan fiduciary net position 1,496,726 179,266 1,391,124 1,648,415
Plan fiduciary net position - beginning 10,433,153 11,929,879 12,109,145 13,500,269
Plan fiduciary net position - ending (b)11,929,879$ 12,109,145$ 13,500,269$ 15,148,684$
Net pension liability (a) - (b)1,882,676$ 2,446,902$ 2,986,947$ 2,052,438$
Plan fiduciary net position as a percentage
of the total pension liability 86.37%83.19%81.88%88.07%
Covered payroll 2,701,771$ 2,375,585$ 2,376,069$ 2,072,121$
Net pension liability as a percentage of
covered payroll 69.68%103.00%125.71%99.05%
Changes of Assumptions
For the 2016 fiscal year the discount rate, investment rate of return, inflation rate, salary scale,
and the withdrawal and mortality rates changed.
For the 2017 fiscal year the mortality rate changed.
NOTE: The Village implemented GASB Statement 67 in 2014; information is presented for those
years in which information is available.
Schedule of Changes in Net Pension Liability and Related Ratios
Last Ten Fiscal Years
THE VILLAGE OF NORTH PALM BEACH, FLORIDA
Required Supplemental Information
September 30, 2017
General Employees Retirement Fund
75
2014 2015 2016 2017
Total pension liability:
Service cost 699,244$ 810,654$ 833,909$ 851,932$
Interest 1,419,425 1,555,518 1,738,069 1,779,947
Changes in excess state money 90,535 67,645 79,505 83,231
Changes of benefit terms 1,682
Differences between Expected and
Actual Experience 483,189 (31,422) (197,249)
Changes of assumptions 246,146 (1,223,780) 198,680
Contributions - Buy Back 65,446 7,609 7,902
Benefit payments, including
refunds of employee contributions (451,574) (611,678) (653,993) (680,673)
Net change in total pension liability 2,003,776 2,372,456 749,897 2,043,770
Total pension liability - beginning 17,476,586 19,480,362 21,852,818 22,602,715
Total pension liability - ending (a)19,480,362$ 21,852,818$ 22,602,715$ 24,646,485$
Plan fiduciary net position
Contributions - employer 943,634$ 975,733$ 969,836$ 945,880$
Contributions - State 321,230 298,340 310,200 309,138
Contributions - Employees 87,010 151,450 190,989 211,474
Contributions - Buy Back 65,446 7,609 7,902
Net investment income 1,468,473 111,884 1,475,735 2,198,298
Benefit payments, including
refunds of employee contributions (451,574) (611,678) (653,993) (680,673)
Administrative expenses (66,748) (76,457) (76,967) (76,293)
Net change in plan fiduciary net position 2,302,025 914,718 2,223,409 2,915,726
Plan fiduciary net position - beginning 14,499,921 16,801,946 17,716,664 19,940,073
Plan fiduciary net position - ending (b)16,801,946$ 17,716,664$ 19,940,073$ 22,855,799$
Net pension liability (a) - (b)2,678,416$ 4,136,154$ 2,662,642$ 1,790,686$
Plan fiduciary net position as a percentage
of the total pension liability 86.25%81.07%88.22%92.73%
Covered employee payroll 4,312,746$ 4,518,020$ 4,601,075$ 4,772,092$
Net pension liability as a percentage of
covered payroll 62.10%91.55%57.87%37.52%
Changes of Assumptions
For the 2014 fiscal year the investment rate of return changed.
For the 2016 fiscal year the salary scale, normal retirement rates, the investment rate of return, discount rate,
withdrawal and mortality rates, and the actuarial cost method all changed.
For the 2017 fiscal year the mortality rate and the investment rate of return changed.
NOTE: The Village implemented GASB Statement 67 in 2014; information is presented for those
years in which information is available.
Schedule of Changes in Net Pension Liability and Related Ratios
Last Ten Fiscal Years
THE VILLAGE OF NORTH PALM BEACH, FLORIDA
Required Supplemental Information
September 30, 2017
Fire and Police Retirement Fund
76
Schedule of Contributions
Fiscal Year Actuarially Contribution Actual Contribution
Ending Determined Actual Deficiency Covered as a Percentage of
September 30 Contribution Contribution (Excess)Payroll Covered Payroll
General Employees Retirement Fund
2014 562,509$ 562,953$ (444)$ 2,701,771$ 20.84%
2015 464,189 464,189 2,375,585 19.54%
2016 449,552 458,615 (9,063) 2,376,069 19.30%
2017 519,821 527,617 (7,796) 2,072,121 25.46%
Fire and Police Retirement Fund
2014 1,173,930$ 1,174,329$ (399)$ 4,312,746$ 27.23%
2015 1,205,408 1,206,428 (1,020) 4,518,020 26.70%
2016 1,193,059 1,200,531 (7,472) 4,601,075 26.09%
2017 1,173,387 1,175,102 (1,715) 4,772,092 24.62%
Schedule of Investment Returns
Fiscal Year
Ending General Fire and Police
September 30 Employees Employees
2014 10.50%10.00%
2015 -0.39%0.66%
2016 9.72%8.25%
2017 11.32%10.92%
NOTE: The Village implemented GASB Statement 67 in 2014; information is presented for those years
in which information is available.
Annual money weighted rate of return
net of investment expense
THE VILLAGE OF NORTH PALM BEACH, FLORIDA
Required Supplemental Information
September 30, 2017
Last Ten Fiscal Years
77
Methods and assumptions used in calculations of determined contributions.
The actuarially determined contribution rates are calculated as of October 1, two years prior to the end of the fiscal year
in which contributions are reported.
General Employees Police and Fire
Retirement Fund Retirement Fund
Actuarial Cost Method Frozen Entry-Age Aggregate
Amortization Method Level Dollar, closed N/A
Remaining Amortization Period 30 years N/A
Asset Valuation Method Five year smoothed market Five year smoothed market
Inflation 2.75%4.00%
Salary increases Service based 6.00%
Between 4% and 10%
Cost of living adjustments 2.5% for those retired before 3.00%
2/1/82 or who contribute
an extra 2%.
Investment Rate of Return 6.75%7.90%
Mortality Female: RP2000, 100%
Annuitant White Collar,
Scale BB Male: RP2000,
50% Annuitant White
Collar/50% Annuitant Blue
Collar, Scale BB
RP-2000 Table with no projection
- (Disabled lives set forward 5
years
THE VILLAGE OF NORTH PALM BEACH, FLORIDA
Notes to the Schedule of Contributions
September 30, 2017
78
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, 2017
Variance with
Final Budget
Budgeted Amounts Actual Positive
Original Final Amounts (Negative)
Revenues
Taxes 16,531,775$ 16,531,775$ 17,118,361$ 586,586$
Licenses and permits 971,800 971,800 997,656 25,856
Intergovernmental 1,451,803 1,451,803 1,459,579 7,776
Charges for services 2,231,365 2,231,365 2,321,298 89,933
Fines and forfeitures 76,175 76,175 124,395 48,220
Investment 52,521 52,521 58,799 6,278
Miscellaneous 13,100 13,100 157,063 143,963
Total revenues 21,328,539 21,328,539 22,237,151 908,612
Expenditures
Current
General government 3,089,825 3,094,925 2,970,223 124,702
Public safety 8,688,912 8,738,912 8,856,922 (118,010)
Public works 4,702,663 4,779,241 4,882,159 (102,918)
Community development and planning 1,510,909 1,628,599 1,190,759 437,840
Leisure services - recreation 2,616,643 2,623,603 2,591,866 31,737
Capital outlay 1,454,961 985,885 469,076
Total expenditures 20,608,952 22,320,241 21,477,814 842,427
Excess of revenues over
expenditures 719,587 (991,702) 759,337 1,751,039
Other financing sources (uses)
Appropriated fund balance 302,207 (302,207)
Debt proceeds 15,000,000 15,000,000
Transfer in 53,082 53,082
Transfer out (719,587) (14,363,587) (14,363,587)
Total other financing uses (719,587) 991,702 689,495 (302,207)
Net change in fund balances $ $ 1,448,832 1,448,832$
Fund Balances
Beginning of year 11,643,878
End of year 13,092,710$
79
THE VILLAGE OF NORTH PALM BEACH, FLORIDA
Notes to the Budgetary
Required Supplementary Information (RSI)
General Fund
Note 1 - Basis of Accounting
Generally accepted accounting principles (GAAP) serve as the budgetary basis of accounting.
Note 2 - Legal Level of Control
The legel level of budgetary control is at the fund level.
September 30, 2017
80
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, 2017
Variance with
Final Budget
Original Final Positive Percent
Budget Budget Actual (Negative)Variance
Village Council
Personnel services 50,466$ 50,466$ 50,477$ (11)$ -0.02
Operating expenses 84,492 84,492 64,879 19,613 23.21
Total Village Council 134,958 134,958 115,356 19,602 14.52
Village Manager
Personnel services 443,670 443,670 382,250 61,420 13.84
Operating expenses 41,670 46,770 88,396 (41,626) -89.00
Total Village Manager 485,340 490,440 470,646 19,794 4.04
Procurement and Purchasing
Personnel services 185,848 185,848 181,576 4,272
Operating expenses 16,910 16,910 12,282 4,628
Total Procurement and Purchasing 202,758 202,758 193,858 8,900
Village Finance
Personnel services 532,781 532,781 533,670 (889) -0.17
Operating expenses 48,150 48,150 95,742 (47,592) -98.84
Total Village Finance 580,931 580,931 629,412 (48,481) -8.35
Village Attorney
Operating expenses 160,000 160,000 179,915 (19,915) -12.45
Village Clerk
Personnel services 324,059 324,059 342,422 (18,363) -5.67
Operating expenses 35,460 35,460 34,288 1,172 3.31
Total Village Clerk 359,519 359,519 376,710 (17,191) -4.78
Information Technology
Personnel services 323,058 323,058 309,673 13,385 4.14
Operating expenses 101,425 101,425 71,148 30,277 29.85
Total Information Technology 424,483 424,483 380,821 43,662 10.29
Human Resources
Personnel services 279,235 279,235 216,625 62,610 22.42
Operating expenses 91,283 91,283 52,200 39,083 42.82
Total Human Resources 370,518 370,518 268,825 101,693 27.45
Police
Personnel services 4,252,008 4,252,008 4,484,837 (232,829) -5.48
Operating expenses 962,429 962,429 788,627 173,802 18.06
Total Police 5,214,437 5,214,437 5,273,464 (59,027) -1.13
Fire Rescue
Personnel services 3,125,565 3,125,565 3,209,567 (84,002) -2.69
Operating expenses 264,185 264,185 211,477 52,708 19.95
Total Fire Rescue 3,389,750 3,389,750 3,421,044 (31,294) -0.92
(Continued)
81
THE VILLAGE OF NORTH PALM BEACH, FLORIDA
Schedule of Departmental Expenditures - Budget and Actual
General Fund
For the Year Ended September 30, 2017
Variance with
Final Budget
Original Final Positive Percent
Budget Budget Actual (Negative)Variance
(Continued)
Public Works Administration
Personnel services 214,875$ 214,875$ 131,936$ 82,939$ 38.60
Operating expenses 128,918 128,918 88,890 40,028 31.05
Total Public Works 343,793 343,793 220,826 122,967 35.77
Sanitation
Personnel services 1,362,433 1,362,433 1,450,918 (88,485) -6.49
Operating expenses 192,500 192,500 228,082 (35,582) -18.48
Total Sanitation 1,554,933 1,554,933 1,679,000 (124,067) -7.98
Facility Services
Personnel services 323,684 323,684 333,039 (9,355) -2.89
Operating expenses 430,350 437,175 249,518 187,657 42.92
Total Facility Services 754,034 760,859 582,557 178,302 23.43
Street Maintenance
Personnel services 465,949 465,949 444,536 21,413 4.60
Operating expenses 1,095,827 1,158,305 992,967 165,338 14.27
Total Street Maintenance 1,561,776 1,624,254 1,437,503 186,751 11.50
Vehicle Maintenance
Personnel services 230,677 230,677 259,868 (29,191) -12.65
Operating expenses 257,450 264,725 221,308 43,417 16.40
Total Vehicle Maintenance 488,127 495,402 481,176 14,226 2.87
Planning and Engineering
Personnel services 269,566 269,566 226,334 43,232 16.04
Operating expenses 141,265 241,238 106,330 134,908 55.92
Total Planning and Engineering 410,831 510,804 332,664 178,140 34.87
Building
Personnel services 815,664 815,664 633,328 182,336 22.35
Operating expenses 140,962 158,679 125,612 33,067 20.84
Total Building 956,626 974,343 758,940 215,403 22.11
Code Enforcement
Personnel services 118,784 118,784 81,038 37,746 31.78
Operating expenses 24,668 24,668 18,117 6,551 26.56
Total Code Enforcement 143,452 143,452 99,155 44,297 30.88
Leisure Services-Recreation
Personnel services 645,394 645,394 694,931 (49,537) -7.68
Operating expenses 401,825 401,825 338,455 63,370 15.77
Total Leisure Services-Recreation 1,047,219 1,047,219 1,033,386 13,833 1.32
(Continued)
82
THE VILLAGE OF NORTH PALM BEACH, FLORIDA
Schedule of Departmental Expenditures - Budget and Actual
General Fund
For the Year Ended September 30, 2017
Variance with
Final Budget
Original Final Positive Percent
Budget Budget Actual (Negative)Variance
(Continued)
Library
Personnel services 658,869$ 658,869$ 619,779$ 39,090$ 5.93
Operating expenses 161,194 161,194 161,445 (251) -0.16
Total Library 820,063 820,063 781,224 38,839 4.74
Tennis
Personnel services 155,643 155,643 129,384 26,259 16.87
Operating expenses 294,354 301,314 313,220 (11,906) -3.95
Total Tennis 449,997 456,957 442,604 14,353 3.14
Pool
Personnel services 95,009 95,009 118,308 (23,299) -24.52
Operating expenses 103,255 103,255 126,250 (22,995) -22.27
Total Pool 198,264 198,264 244,558 (46,294) -23.35
Special Events
Operating expenses 101,000 101,000 90,065 10,935 10.83
Total Special Events 101,000 101,000 90,065 10,935 10.83
Reserves and contingencies
Operating expenses 1,008,183 1,281,527 (273,344)
1,008,183 1,281,527 (273,344)
Non-Departmental
Operating expenses 456,143 506,143 517,123 (10,980) -2.17
456,143 506,143 517,123 (10,980) -2.17
Capital Outlay
Police 29,683 (29,683)
Vehicle Maintenance 5,352 (5,352)
Planning and Engineering 1,879 1,879 100.00
Building 6,295 (6,295)
Reserves and contingencies 444,899 144,125 300,774 67.61
Total Capital Outlay 446,778 185,455 261,323 58.49
Total expenditures 20,608,952$ 22,320,241$ 21,477,814$ 842,427$ 3.77%
83
COMBINING FINANCIAL STATEMENTS
NONMAJOR GOVERNMENTAL FUNDS
Special Revenue Funds
Public Safety Fund
Northlake Boulevard Fund
Recreation Fund
On-Behalf Pension Contributions
THE VILLAGE OF NORTH PALM BEACH, FLORIDA
Combining Balance Sheet
Nonmajor Governmental Funds
Special Revenue Funds
Public Northlake On-Behalf Total Nonmajor
Safety Boulevard Pension Governmental
Fund Fund Recreation Contributions Funds
Assets
Cash and cash equivalents 1,520$ 1,986$ 440,812$ 444,318$
Due from other governments 2,791 2,791
Total assets 1,520$ 1,986$ 440,812$ 2,791$ 447,109$
Liabilities
Accounts payable $ $ 11,309$ 2,791$ 14,100$
Due to other funds 44,028 44,028
Total liabilities 55,337 2,791 58,128
Fund balances
Assigned 1,520 1,986 385,475 388,981
Total fund balances 1,520 1,986 385,475 388,981
Total liabilities and fund balances 1,520$ 1,986$ 440,812$ 2,791$ 447,109$
September 30, 2017
84
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, 2017
Special Revenue Funds
Public Northlake On-Behalf Total Nonmajor
Safety Boulevard Pension Governmental
Fund Fund Recreation Contributions Funds
Revenues
Intergovernmental 18,992$ $ 77,500$ 309,138$ 405,630$
Fines and forfeitures
Total revenues 18,992 77,500 309,138 405,630
Expenditures
Current
Public safety 309,138 309,138
Capital outlay 18,992 197,000 215,992
Total expenditures 18,992 197,000 309,138 525,130
Excess (deficiency) of revenues over
(under) expenditures (119,500) (119,500)
Other financing sources (uses)
Transfers in
Total other financing sources (uses)
Net changes in fund balances (119,500) (119,500)
Fund balances - Beginning of year 1,520 1,986 504,975 508,481
Fund balances - End of year 1,520$ 1,986$ 385,475$ $ 388,981$
85
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 Position - Pension Trust Funds
Fire and Total
General Police Employee
Employees Officers Retirement
Pension Pension Funds
Assets
Cash and cash equivalents 284,925$ 302,673$ 587,598$
Investments:
Domestic common equity securities 10,757,817 10,757,817
International common equity securities 2,393,230 2,393,230
U.S. Government and agencies 1,991,487 1,991,487
Municipal bonds 311,950 311,950
Corporate bonds 3,477,006 3,477,006
Fixed income exchange traded funds 2,789,819 2,789,819
Equity exchange traded funds 2,944,061 2,944,061
Fixed income mutual funds 2,640,119 2,640,119
Equity mutual funds 6,462,257 6,462,257
Real estate investment fund 2,386,295 2,386,295
Money market mutual funds 1,151,404 1,151,404
Accrued interest and dividends 5,596 52,883 58,479
Accounts receivable 45,599 67,526 113,125
Prepaids 2,182 2,182
Total assets 15,172,376 22,894,453 38,066,829
Liabilities
Accounts payable 23,692 38,654 62,346
Total liabilities 23,692 38,654 62,346
Net Position restricted for pensions 15,148,684$ 22,855,799$ 38,004,483$
September 30, 2017
86
Fire and Total
General Police Employee
Employees Officers Retirement
Pension Pension Funds
Additions
Contributions
Employer 527,617$ 945,880$ 1,473,497$
Plan members 110,417 219,376 329,793
State on-behalf payments 309,138 309,138
Total contributions 638,034 1,474,394 2,112,428
Investment earnings
Dividends and interest 374,112 545,211 919,323
Net increase in fair value of investments 1,157,744 1,817,794 2,975,538
Total investment earnings 1,531,856 2,363,005 3,894,861
Less: investment expenses 44,543 163,982 208,525
Total investment earnings 1,487,313 2,199,023 3,686,336
Total additions 2,125,347 3,673,417 5,798,764
Deductions
Administration 22,361 77,018 99,379
Termination refunds 13,492 552 14,044
Benefits 441,079 680,121 1,121,200
Total deductions 476,932 757,691 1,234,623
Change in net position 1,648,415 2,915,726 4,564,141
Net position - beginning 13,500,269 19,940,073 33,440,342
Net position - ending 15,148,684$ 22,855,799$ 38,004,483$
THE VILLAGE OF NORTH PALM BEACH, FLORIDA
Pension Trust Funds
Combining Statement of Changes in Fiduciary Net Position
For the Year Ended September 30, 2017
87
AGENCY FUNDS
Manatee Protection Agency
Northlake Boulevard Task Force
THE VILLAGE OF NORTH PALM BEACH, FLORIDA
Combining Statement of Agency Net Position
Manatee Northlake Total
Protection Boulevard Agency
Agency Task Force Funds
Assets
Cash and cash equivalents 302,987$ 64,417$ 367,404$
Liabilities
Due to others 302,987$ 64,417$ 367,404$
September 30, 2017
88
Combining Schedule of Changes in Agency Net Position
September 30, 2016 Additions Deductions September 30, 2017
Manatee Protection Agency
Assets
Cash and cash equivalents 299,502$ 3,485$ $ 302,987$
Liabilities
Due to others 299,502$ 3,485$ $ 302,987$
Northlake Boulevard Task Force
Assets
Cash and cash equivalents 63,675$ 742$ $ 64,417$
Liabilities
Due to others 63,675$ 742$ $ 64,417$
Total All Agency Funds
Assets
Cash and cash equivalents 363,177$ 4,227$ $ 367,404$
Liabilities
Due to others 363,177$ 4,227$ $ 367,404$
THE VILLAGE OF NORTH PALM BEACH, FLORIDA
For the Year Ended September 30, 2017
89
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, 2017
Variance with
Final Budget
Original Final Positive Percent
Budget Budget Actual (Negative)Variance
Revenue
Greens fee/cart rentals/membership fees 2,359,290$ 2,359,290$ 2,302,645$ (56,645)$ -2.40
Golf shop revenues 367,800 367,800 296,119 (71,681) -19.49
Driving range revenues 315,920 315,920 303,994 (11,926) -3.78
Restaurant revenues 738,445 738,445 32,595 (705,850) -95.59
Interest revenues 10,000 10,000 10,274 274 2.74
Miscellaneous 6,000 6,000 11,079 5,079 84.65
Appropriated net position 45,400 45,400 (45,400) -100.00
Total revenues 3,842,855 3,842,855 2,956,706 (886,149)-23.06
Golf Maintenance
Operating expenses 1,138,162 1,138,162 1,137,008 1,154 0.10
Total Golf Maintenance 1,138,162 1,138,162 1,137,008 1,154 0.10
Golf Pro Shop and Range
Personnel services 654,128 654,128 577,878 76,250 11.66
Operating expenses 509,973 509,973 418,621 91,352 17.91
Total Golf Pro Shop and Range 1,164,101 1,164,101 996,499 167,602 14.40
Food and Beverage
Personnel services 498,754 498,754 1,291 497,463 99.74
Operating expenses 389,017 389,017 64,288 324,729 83.47
Total Food and Beverage 887,771 887,771 65,579 822,192 92.61
Administration
Personnel services 65,424 65,424 70,262 (4,838) -7.39
Operating expenses 28,887 28,887 20,110 8,777 30.38
Total Administration 94,311 94,311 90,372 3,939 4.18
Clubhouse and Grounds
Operating expenses 95,889 95,889 118,379 (22,490) (23.45)
Capital outlay 7,000 7,000 2,416 4,584
Total Clubhouse and Grounds 102,889 102,889 120,795 (17,906) (17.40)
Insurance and General Liability
Operating expenses 47,470 47,470 47,469 1 0.00
Reserves
Operating 10,000 10,000 15,090 (5,090) (50.90)
Total Reserves 10,000 10,000 15,090 (5,090) (50.90)
Debt service
Debt service (1)398,151 398,151 541,159 (143,008) (35.92)
Total expenses on the budgetary basis 3,842,855 3,842,855 3,013,971 828,884 21.57
Revenues over expenses $ $ (57,265)$ (57,265)$
Adjustments to reconcile to the GAAP Basis
Total expenses on the budgetary basis 3,013,971
Less: debt service (541,159)
Add: depreciation expense 327,078
Total operating expenses 2,799,890$
(1)The payment that is due October 1 is typically paid in September, but was paid in October of the current year.
90
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 Page
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 Position by Component 91
Changes in Net Position 92
Fund Balances, Governmental Funds 94
Changes in Fund Balances, Governmental Fund 95
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 97
Property Tax Rates - Direct and Overlapping Governments 98
Principal Property Taxpayers 99
Property Tax Levies and Collections 100
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 101
Direct and Overlapping Governmental Activities Debt 102
Pledged-Revenue Coverage 103
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 104
Principal Employers 105
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 106
Operating Indicators by Function/Program 107
Capital Asset Statistics by Function/Program 108
Sources: Unless otherwise noted, the information in these schedules is derived from the comprehensive annual
financial reports for the relevant year.
STATISTICAL SECTION
THIS PAGE INTENTIONALLY LEFT BLANK
2008 2009 2010 2011 2012
Governmental Activities:
Net investment in capital assets 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 position 23,661,187 27,910,955 29,143,183 29,561,465 28,614,042
Business-Type Activities:
Net investment in capital assets 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 position 2,695,326 2,799,026 2,698,386 2,586,550 2,640,622
Primary government:
Net investment in capital assets 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 position 26,356,513$ 30,709,981$ 31,841,569$ 32,148,015$ 31,254,664$
2013 2014 2015 (1)2016 2017
Governmental Activities:
Net investment in capital assets 15,431,966$ 14,966,927$ 14,711,016$ 14,102,547$ 13,484,731$
Restricted 317,190 180,755 177,431 398,519 992,538
Unrestricted 11,973,715 11,314,096 6,168,366 6,677,850 6,536,225
Total governmental activities net position 27,722,871 26,461,778 21,056,813 21,178,916 21,013,494
Business-Type Activities:
Net investment in capital assets 1,998,974 1,907,746 1,833,975 1,880,421 1,991,168
Unrestricted 668,434 514,167 544,523 418,726 361,461
Total business-type activities net position 2,667,408 2,421,913 2,378,498 2,299,147 2,352,629
Primary government:
Net investment in capital assets 17,430,940 16,874,673 16,544,991 15,982,968 15,475,899
Restricted 317,190 180,755 177,431 398,519 992,538
Unrestricted 12,642,149 11,828,263 6,712,889 7,096,576 6,897,686
Total primary government net position 30,390,279$ 28,883,691$ 23,435,311$ 23,478,063$ 23,366,123$
(1)The Village implemented GASB 68 in 2015 related to pension accounting which significantly reduced unrestricted net position.
Basic Financial Statements and Management's Discussion and Analysis for State and Local Governments.
Fiscal Year
VILLAGE OF NORTH PALM BEACH
NET POSITION BY COMPONENT
LAST TEN FISCAL YEARS
(ACCRUAL BASIS OF ACCOUNTING) Unaudited
91
VILLAGE OF NORTH PALM BEACH
CHANGES IN NET POSITION
LAST TEN FISCAL YEARS
(ACCRUAL BASIS OF ACCOUNTING) Unaudited
Fiscal Year
2008 2009 2010 2011 2012
Expenses
Governmental activities:
General government 1,839,228$ 2,239,511$ 2,679,192$ 2,403,681$ 2,520,815$
Public safety 7,154,578 7,095,043 7,304,233 7,232,748 7,892,561
Public works 3,996,711 4,083,441 4,594,738 4,733,913 4,652,620
Community development and planning 860,448 826,149 806,536 811,177 884,773
Leisure services 3,244,045 3,174,623 2,830,292 2,749,065 2,873,496
Interest on long-term debt 120,549 26,702 4,384
Total governmental activities expenses 17,215,559 17,445,469 18,219,375 17,930,584 18,824,265
Business-type activities:
Country club 3,268,562 3,308,535 3,398,206 3,691,528 3,536,139
Total business-type activities 3,268,562 3,308,535 3,398,206 3,691,528 3,536,139
Total primary government expenses 20,484,121$ 20,754,004$ 21,617,581$ 21,622,112$ 22,360,404$
Program Revenues
Governmental activities:
Charges for services:
General government 123,334$ 122,569$ 126,968$ 130,886$ 135,372$
Public safety 383,325 378,591 465,263 420,653 440,568
Public works 288,994 394,082 411,722 400,662 386,974
Community development and planning 888,015 699,130 734,718 861,394 816,673
Leisure services 595,558 912,862 1,063,748 1,043,459 1,018,883
Other government
Operating grants and contributions 88,224 105,080 96,670 126,568 149,573
Capital grants and contributions 1,602,465 2,017,158 75,845 5,169 5,686
Total governmental activities program revenues 3,969,915 4,629,472 2,974,934 2,988,791 2,953,729
Business-type activities:
Charges for services:
Country club 3,616,509 3,404,859 3,227,580 3,571,199 3,582,760
Operating grants and contributions 13,609
Capital grants and contributions
Total business-type activities program revenues 3,630,118 3,404,859 3,227,580 3,571,199 3,582,760
Total primary government program revenues 7,600,033$ 8,034,331$ 6,202,514$ 6,559,990$ 6,536,489$
Net (Expense)/Revenue
Governmental activities (13,245,644)$ (12,815,997)$ (15,244,441)$ (14,941,793)$ (15,870,536)$
Business-type activities 361,556 96,324 (170,626) (120,329) 46,621
Total primary government net expense (12,884,088)$ (12,719,673)$ (15,415,067)$ (15,062,122)$ (15,823,915)$
General revenues and other changes in net position:
Governmental activities:
Taxes:
Property taxes 11,915,355$ 11,917,359$ 11,053,128$ 10,441,869$ 10,011,748$
Local option gas taxes 278,649 267,557 266,077 259,794 263,369
Utility service taxes 2,018,071 2,239,002 2,261,375 2,198,148 2,164,920
Franchise taxes 1,212,562 1,256,831 1,204,328 1,191,155 1,178,598
Sales and use taxes 1,227,341 1,116,107 1,114,945 1,140,744 1,138,097
Unrestricted grants and contributions
Investment earnings 194,652 (1,346) 280,217 97,743 90,968
Miscellaneous 55,719 263,459 213,425 30,622 75,413
Contributions for Support Our Troops 16,959 6,796
Gain on disposl of equipment
Transfers 49,296
Total governmental activities 16,968,604 17,065,765 16,393,495 15,360,075 14,923,113
Business-type activities:
Investment income 36,431 7,376 14,686 8,493 7,451
Miscellaneous 55,300
Transfers (49,296)
Total business-type activities (12,865) 7,376 69,986 8,493 7,451
Total primary government 16,955,739$ 17,073,141$ 16,463,481$ 15,368,568$ 14,930,564$
Change in net position
Governmental activities 3,722,960$ 4,249,768$ 1,149,054$ 418,282$ (947,423)$
Business-type activities 348,691 103,700 (100,640) (111,836) 54,072
Total primary government 4,071,651$ 4,353,468$ 1,048,414$ 306,446$ (893,351)$
Basic Financial Statements and Management's Discussion and Analysis for State and Local Governments.
92
2013 2014 2015 2016 2017
2,489,488$ 2,696,298$ 3,028,716$ 2,985,185$ 3,205,903$
8,282,062 9,259,442 9,311,441 9,308,778 9,905,815
4,482,973 4,485,246 4,963,704 5,106,651 5,707,570
966,245 1,046,299 1,308,924 1,382,121 1,255,115
2,974,290 3,114,213 2,973,687 2,904,715 3,114,720
266,892
19,195,058 20,601,498 21,586,472 21,687,450 23,456,015
3,629,120 3,902,131 3,842,660 3,845,547 2,903,224
3,629,120 3,902,131 3,842,660 3,845,547 2,903,224
22,824,178$ 24,503,629$ 25,429,132$ 25,532,997$ 26,359,239$
107,976$ 110,694$ 131,445$ 128,459$ 134,249$
522,121 592,644 537,064 628,529 557,265
403,447 402,814 514,354 565,011 547,596
993,059 1,621,471 1,163,875 1,213,032 1,222,464
1,087,182 1,096,021 1,006,382 994,918 1,022,175
91,901 90,520 380,567 365,823 377,339
233,949 16,098 26,548 229,161 102,187
3,439,635 3,930,262 3,760,235 4,124,933 3,963,275
3,577,446 3,645,706 3,788,852 3,720,573 2,946,432
3,577,446 3,645,706 3,788,852 3,720,573 2,946,432
7,017,081$ 7,575,968$ 7,549,087$ 7,845,506$ 6,909,707$
(15,755,423)$ (16,671,236)$ (17,826,237)$ (17,562,517)$ (19,492,740)$
(51,674) (256,425) (53,808) (124,974) 43,208
(15,807,097)$ (16,927,661)$ (17,880,045)$ (17,687,491)$ (19,449,532)$
9,981,391$ 10,154,695$ 11,364,888$ 12,253,917$ 13,091,985$
261,852 266,147 282,549 288,150 305,700
2,197,760 2,277,366 2,267,118 2,303,294 2,413,679
1,160,780 1,232,669 1,253,139 1,263,812 1,306,997
1,187,221 1,260,617 1,332,209 1,363,954 1,924,490
37,029 16,653 108,794 103,353 126,926
38,219 146,360 57,137 60,026 150,698
55,636 30,457 48,114 6,843
14,864,252 15,410,143 16,696,291 17,684,620 19,327,318
8,555 10,930 10,393 9,230 10,274
69,905 36,393
78,460 10,930 10,393 45,623 10,274
14,942,712$ 15,421,073$ 16,706,684$ 17,730,243$ 19,337,592$
(891,171)$ (1,261,093)$ (1,129,946)$ 122,103$ (165,422)$
26,786 (245,495) (43,415) (79,351) 53,482
(864,385)$ (1,506,588)$ (1,173,361)$ 42,752$ (111,940)$
93
2008 2009 2010 2011 2012
Pre GASB 54
General Fund
Reserved 775,339$ 563,115$ $ $ $
Unreserved 8,265,513 10,058,216
Total general fund
Post GASB 54
General Fund
Nonspendable
Restricted 167,108 276,924 166,839
Committed 338,457 548,489 658,194
Assigned
Unassigned 104,245 186,594 127,574
10,443,099 10,688,660 11,244,977
Total general fund 9,040,852$ 10,621,331$ 11,052,909$ 11,700,667$ 12,197,584$
Pre GASB 54
All other Governmental Funds
Reserved 239,979$ $ $ $ $
Unreserved, reported in:
Special revenue funds 594,399 (152,861)
Capital projects funds 713,373 825,778
Total all other governmental funds
Post GASB 54
All other Governmental Funds
Restricted
Assigned
Special revenue funds 47,379 47,107 47,652
Capital projects funds 844,742 1,491,574 2,129,831
Total all other governmental funds 1,547,751$ 672,917$ 892,121$ 1,538,681$ 2,177,483$
Post GASB 54 2013 2014 2015 2016 2017
General Fund
Nonspendable 293,674$ 244,438$ 155,594$ 358,606$ 183,220$
Restricted 317,190 135,255 131,931 353,019 781,756
Committed 442,833
Assigned 200,016 216,808 319,888 208,204 316,266
Unassigned 11,451,668 12,391,362 10,802,623 10,724,049 11,811,468
Total general fund 12,705,381$ 12,987,863$ 11,410,036$ 11,643,878$ 13,092,710$
All other Governmental Funds
Restricted $ 45,500$ 45,500$ 45,500$ 13,988,744$
Assigned
Special revenue funds 47,652 325,152 318,526 508,481 388,981
Capital projects funds 1,799,617 841,850 1,448,620 1,604,073 1,670,196
Total all other governmental funds 1,847,269$ 1,212,502$ 1,812,646$ 2,158,054$ 16,047,921$
Basic Financial Statements and Management's Discussion and Analysis for State and Local Governments.
The Village implemented GASB 54, Fund Balance Reporting and Government Fund Definitions, in 2011 and restated the 2010 amounts.
VILLAGE OF NORTH PALM BEACH
FUND BALANCES, GOVERNMENTAL FUNDS
LAST TEN FISCAL YEARS
(MODIFIED ACCRUAL BASIS OF ACCOUNTING) Unaudited
94
THIS PAGE INTENTIONALLY LEFT BLANK
VILLAGE OF NORTH PALM BEACH
CHANGES IN FUND BALANCES, GOVERNMENTAL FUNDS
LAST TEN FISCAL YEARS
(MODIFIED ACCRUAL BASIS OF ACCOUNTING) Unaudited
Fiscal Year
2008 2009 2010 2011 2012
Revenues:
Taxes 15,424,638$ 15,680,749$ 14,784,906$ 14,090,966$ 13,618,635$
Licenses and Permits 1,047,144 880,016 910,997 959,098 810,390
Intergovernmental 2,459,211 3,315,908 1,768,388 1,557,377 1,591,678
Charges for services 1,268,774 1,684,718 1,944,245 1,934,424 1,966,179
Fines and forfeitures 235,965 145,340 142,048 164,366 140,610
Investment earnings 194,652 (1,345) 280,218 97,743 90,968
Miscellaneous 137,447 300,455 278,062 59,462 130,293
Total revenues 20,767,831 22,005,841 20,108,864 18,863,436 18,348,753
Expenditures:
General government 2,246,461 1,970,257 2,496,342 2,402,241 2,328,568
Public safety 7,056,833 6,835,730 7,021,231 7,053,282 7,583,018
Public works 3,725,450 3,432,556 3,887,034 4,044,642 3,886,698
Community development and planning 840,366 784,486 774,121 790,937 844,748
Leisure services - recreation 2,876,840 2,898,252 2,361,388 2,295,959 2,374,748
Other government
Capital outlay 2,597,065 3,939,455 663,582 682,057 495,254
Debt service
Principal payments 716,206 1,395,735 2,250,000
Interest paid on debt 143,726 43,725 4,384
Total expenditures 20,202,947 21,300,196 19,458,082 17,269,118 17,513,034
Excess of revenues over (under) expenditures 564,884 705,645 650,782 1,594,318 835,719
Other financing sources (uses)
Transfers in 1,254,952 454,111 163,490 1,334,934 500,000
Transfers out (1,254,952) (454,111) (163,490) (1,334,934) (500,000)
Capital lease
Proceeds from debt issuance
Miscellaneous
Total other financing sources (uses)
Net change in fund balances 564,884$ 705,645$ 650,782$ 1,594,318$ 835,719$
Debt service as a percentage of noncapital
expenditures 4.91%8.07%11.99%--
95
2013 2014 2015 2016 2017
13,601,783$ 13,930,877$ 15,167,694$ 16,109,173$ 17,118,361$
803,337 1,344,653 947,158 1,235,782 997,656
1,817,603 1,688,608 1,758,246 1,765,836 2,417,809
2,141,437 2,320,305 2,231,673 2,364,013 2,321,298
131,524 117,869 128,235 91,534 124,395
37,029 16,653 108,794 103,353 126,926
207,076 258,086 122,107 191,250 157,063
18,739,789 19,677,051 20,463,907 21,860,941 23,263,508
2,346,281 2,541,546 2,904,553 2,876,521 2,970,223
7,947,221 8,947,627 8,966,077 9,129,947 9,166,060
3,733,977 3,773,689 4,255,636 4,266,749 4,882,159
933,117 1,004,642 1,270,399 1,351,061 1,190,759
2,491,559 2,644,598 2,514,495 2,448,164 2,591,866
1,110,051 1,117,234 1,530,430 1,209,249 2,123,742
18,562,206 20,029,336 21,441,590 21,281,691 22,924,809
177,583 (352,285) (977,683) 579,250 338,699
265,000 323,000 2,091,246 1,503,750 1,503,750
(265,000) (323,000) (2,091,246) (1,503,750) (1,503,750)
15,000,000
15,000,000
177,583$ (352,285)$ (977,683)$ 579,250$ 15,338,699$
-----
96
Fiscal Year
Ended
Sept 30,
Tax Roll
Year Residential Property
Commercial
Property
Personal
Property
Total Net Market -
Assessed Value
Total Direct
Tax Rate
2008 2007 1,744,202,888$ 229,300,592$ 43,735,861$ 2,017,239,341$ 6.0000
2009 2008 1,575,367,916 230,599,951 41,471,282 1,847,439,149 6.6977
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
2013 2012 1,254,302,880 195,770,816 30,033,151 1,480,106,847 6.9723
2014 2013 1,287,481,785 203,512,929 33,792,851 1,524,787,565 6.8731
2015 2014 1,355,969,888 214,484,701 34,077,944 1,604,532,533 7.3300
2016 2015 1,453,735,176 232,020,936 36,939,006 1,722,695,118 7.3300
2017 2016 1,545,192,840 259,097,141 40,181,846 1,844,471,827 7.3300
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
Real Property
VILLAGE OF NORTH PALM BEACH
NET ASSESSED VALUE AND ESTIMATED ACTUAL VALUE OF TAXABLE PROPERTY
LAST TEN FISCAL YEARS
97
Palm Beach Total
County Palm Direct and
Fiscal Tax Roll Village of School Beach Special Overlapping
Year Year N. Palm Beach District County Districts Rates
2008 2007 6.1000 7.3560 3.9813 2.1308 19.5681
2009 2008 6.6977 7.2500 3.9660 2.2570 20.1707
2010 2009 6.9000 7.9830 4.5614 2.4934 21.9378
2011 2010 6.9723 8.1540 4.9960 2.5549 22.6772
2012 2011 6.9723 8.1800 4.9925 2.3433 22.4881
2013 2012 6.9723 7.7780 4.9902 2.3154 22.0559
2014 2013 6.8731 7.5860 4.9852 2.2280 21.6723
2015 2014 7.3300 7.5940 4.9729 2.1732 22.0701
2016 2015 7.3300 7.5120 4.9277 2.0974 21.8671
2017 2016 7.3300 7.0700 4.9142 1.9453 21.2595
Note:All millage rates are based on $1 for every $1,000 of assessed value.
Source:North Palm Beach: Notice of Ad Valorem Taxes and Non-Ad Valorem Assessments
(1)Overlapping rates are those of local and county governments that apply to property owners within the Village
of North Palm Beach. Not all overlapping rates apply to all Village of North Palm Beach property owners
(i.e. The rates for special districts apply only to the proportion of the government's property owners whose
property is located within the geographic boundaries of the special district.)
VILLAGE OF NORTH PALM BEACH
PROPERTY TAX RATES - DIRECT AND OVERLAPPING GOVERNMENTS
LAST TEN FISCAL YEARS
Overlapping Rates (1)
98
Percentage Percentage
of Total of Total
Village Net Village Net
Taxable Taxable Taxable Taxable
Assessed Assessed Assessed Assessed
Taxpayers Value Rank Value Value Rank Value
Domani Devolopment, LLC 36,000,043 1 1.95%13,720,275 3 0.68%
Olen Residential Realty 30,410,469 2 1.65%16,800,000 2 0.83%
Old Port Cove Equities, Inc 33,053,607 3 1.79%
Sanctuary Bay Trust Corporation 24,073,391 4 1.31%13,200,300 4 0.65%
Florida Power & Light 19,832,057 5 1.08%
JB Shoppes LLLP 16,035,391 6 0.87%
Pearland RJR LLC 13,004,935 7 0.71%
New Country Motor Cars 14,366,560 8 0.78%
Old Port Cove Holdings, Inc 10,514,192 9 0.57% 7,702,923 8 0.38%
Chouest, Gary 9,428,273 10 0.51%
Crystal Tree NPb 18,037,727 1 0.89%
CF02 Palm Beach III LP 13,000,000 5 0.64%
Greater Fla Inv Co& 10,371,407 6 0.51%
Village Shoppers at US 1LLC 9,325,955 7 0.46%
Riverside National Bank of FL 6,363,298 9 0.32%
Northlake Storage, LLC 5,610,908 10 0.28%
Total 206,718,918$ 11.22%114,132,793$ 5.64%
Source: Palm Beach Country Appraiser
VILLAGE OF NORTH PALM BEACH
PRINCIPAL PROPERTY TAXPAYERS
2017 & 2008 Presented
2017 2008
Note: Assessed values are established by the Palm Beach Property Appraiser's offices as of January 1, each year.
99
Fiscal Year Total Taxes Collections in
Ending Tax Roll Levied for Percent Subsequent Percent
Sept 30,Year Fiscal Year Amount of Levy Years Amount of Levy
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%
2013 2012 10,358,172 9,948,550 96.05%36,366 9,984,916 96.40%
2014 2013 10,503,598 10,097,763 96.14%57,493 10,155,256 96.68%
2015 2014 11,761,226 11,350,738 96.51%14,777 11,365,515 96.64%
2016 2015 12,627,355 12,197,736 96.60%57,133 12,254,869 97.05%
2017 2016 13,519,978 13,051,272 96.53%41,267 13,092,539 96.84%
Source:Palm Beach Country Property Appraiser
*Information available from the PBC Tax Collector is presented
of the Levy to Date
Total Collections
Collected within
VILLAGE OF NORTH PALM BEACH
PROPERTY TAX LEVIES AND COLLECTIONS
LAST TEN CALENDAR YEARS
the Fiscal Year
100
VILLAGE OF NORTH PALM BEACH
RATIOS OF OUTSTANDING DEBT BY TYPE
Business-type
Activities
Fiscal Year Percent of
Ended Loans Capital Loans Capital Median Personal Per
Sept 30,Payable Leases Payable Leases Total Income (1)Capita
2008 3,605,639 40,097 4,662,833 192,892 8,501,461 1.01%692.64
2009 2,250,000 - 4,383,033 97,049 6,730,082 0.83%583.15
2010 - - 4,090,284 235,176 4,325,460 0.56%371.64
2011 - - 3,844,928 173,084 4,018,012 *0.54%*345.22
2012 - - 3,608,294 106,933 3,715,227 0.50%303.51
2013 - - 3,357,875 396,055 3,753,930 0.49%305.37
2014 - - 3,096,925 274,471 3,371,396 0.46%266.62
2015 - - 2,824,987 147,767 2,972,754 0.37%234.94
2016 - - 2,684,913 - 2,684,913 0.35%212.20
2017 15,000,000 - 2,247,088 - 17,247,088 1.85%1,292.69
Note:Details regarding the Village's outstanding debt may be found in the notes to the
financial statements.
*Information was not available, the prior year info was used.
(1)See the Schedule of Demographic and Economic Statistics on page 103 for personal inome and population data.
Governmental Activities
LAST TEN FISCAL YEARS
101
Percentage Amount
Net Applicable to Applicable to
Debt the Village of the Village of
Outstanding North Palm Beach (1) North Palm Beach
Debt repaid with property taxes:
Palm Beach County 111,216$ 1.12%1,246$
Palm Beach County School Board 11,396 1.03%117$
Other debt:
Palm Beach County 846,515 1.12%9,481
Palm Beach County School Board 1.03%
Subtotal, overlapping debt 10,844
Village of North Palm Beach Direct Debt -
Total direct and overlapping debt 10,844$
Sources:Palm Beach County Tax Appraiser's Office
Palm Beach County School Board
Palm Beach County Clerk & Comptroller
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.
VILLAGE OF NORTH PALM BEACH
DIRECT AND OVERLAPPING GOVERNMENTAL ACTIVITIES DEBT
SEPTEMBER 30, 2017
Unaudited
Government Unit
102
VILLAGE OF NORTH PALM BEACH
Pledged - Revenue Coverage
Country Club Bonds
Last Ten Fiscal Years
Unaudited
Required
Fiscal Gross Operating Debt
Year Revenues (1) Expenses (2)Net Revenue Service Coverage (3)
2008 3,652,940$ 2,558,591$ 1,094,349$ 394,900 2.77
2009 3,412,235 2,587,171 825,064 394,900 2.09
2010 3,242,266 2,728,470 513,796 394,900 1.30
2011 3,579,692 3,049,301 530,391 394,900 1.34
2012 3,590,211 2,932,743 657,468 394,900 1.66
2013 3,586,001 2,986,080 599,921 394,900 1.52
2014 3,656,636 3,248,284 408,352 394,900 1.03
2015 3,799,245 3,226,907 572,338 394,900 1.45
2016 3,766,196 3,333,395 432,801 394,900 1.10
2017 2,956,706 2,472,812 483,894 394,900 1.23
Note:The Non-Ad Valorem Revenue Notes, Series 2017 do not have any pledged revenues.
(1)Gross revenue includes all revenues derived by the Village from the ownership and operation
of the Country Club.
(2)Operating expenses excludes non-cash expenses
(3)Coverage should be not less than 1.00.
103
Per Palm Beach
Median Capita County
Calendar Personal Personal Unemployment
Year Population (1)Income (1)Income (1)Rate (2)
2008 (estimate)12,274 65,815 45,563 6.3
2009 (estimate)11,541 66,401 49,350 10.8
2010 (estimate)11,639 64,156 49,130 12.0
2011 (estimate)***10.7
2012 (estimate)12,241 ***62,121 ****49,117 **5.29
2013 (estimate)12,293 ***59,778 ****42,830 **4.66
2014 (estimate)12,645 ***63,349 ****43,120 **3.92
2015 (estimate)12,653 ***61,057 ****43,120 **3.15
2016 (estimate)12,817 ***61,653 ****45,110 **2.10
2017 (estimate)13,342 ***69,718 ****46,160 **2.70
Sources:Business Development Board
US Census Bureau
*2011 Demographic data is not available due to Agency Software upgrade
that is not complete
**Village of North Palm Beach Unemployment Rate for 2012-2016 presented
***North Palm Beach Median Personal Income for 2012 - 2016 presented
****West Palm Beach/Ft Lauderdale/Miami Mean Income data presented
Note: (1)All information available at the current time is presented.
(2)North Palm Beach is not large enough to track unemployment rates.
Palm Beach County rates are presented.
VILLAGE OF NORTH PALM BEACH
DEMOGRAPHIC AND ECONOMIC STATISTICS
LAST TEN CALENDAR YEARS
Unaudited
104
Percentage Percentage
of Total of Total
Employer Employees Employment Employees Employment
Palm Beach Country School Board 21,200 2.98%21,707 3.47%
Federal Government 6,265 0.88%6,191 0.99%
Tenet Health Care Corp 6,136 0.86%4,500 0.72%
Palm Beach County Government 5,928 0.83%11,293 1.80%
NextEra Energy (Florida Power & Light) 4,021 0.57%3,250 0.52%
Hospital Corporation of America (HCA) (1)3,550 0.50%3,411 0.54%
Boca Raton Regional Hospital (2)2,800 0.39%1,860 0.30%
Florida Alantic University 2,761 0.39%2,923 0.47%
Veterans Health Administration 2,468 0.35%1,500 0.24%
Bethesda Memorial Hospital 2,200 0.31%1,600 0.26%
Office Depot 2,034 0.29%2,180 0.35%
The Breakers Hotel 2,000 0.28%2,300 0.37%
Florida Crystals (Headquarters)2,000 0.28%1,800 0.29%
Jupiter Medical Center 1,907 0.27%1,400 0.22%
State Government 1,618 0.23%2,287 0.37%
City of Boca Raton 1,499 0.21%1,297 0.21%
City of West Palm Beach 1,420 0.20%1,544 0.25%
69,807 9.82%71,043 11.37%
*** FY 2017 data is not available - FY 2007 & 2016 data presented
VILLAGE OF NORTH PALM BEACH
PRINCIPAL EMPLOYERS
2016**2007**
(1) Formerly Columbia Palm Beach Health Care Systems, Inc
(2) Formerly Boca Raton Community Hospital
Source: Business Development Board of Palm Beach County, floridajobs.org
* 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:
105
2008 2009 2010 2011 2012 2013 2014 2015 2016 2017
Number of Employees:
General Government
Village Manager
Full-Time 2 2 2 2 2 2 2 2 2 4
Part-Time 0 0 0 0 0 0 0 0 0 1
Information Technology
Full-Time 2 2 2 2 3 3 3 3 3 3
Part-Time 0 1 1 1 0 0 0 0 0 0
Human Resources
Full-Time 2 2 2 2 2 2 2 2 2 2
Part-Time 0 0 0 0 0 0 0 1 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 7 7 5
Part-Time 1 1 1 1 1 1 1 0 0 1
Public Works
Full-time 48 38 37 37 37 37 37 35 34 36
Part-Time 0 0 0 0 0 0 0 0 0 0
Police & Fire
Full-time 68 67 67 67 0 0 0 0 0 0
Part-Time 12 11 12 12 0 0 0 0 0 0
Police
Full-time 0 0 0 0 43 43 43 36 36 36
Part-Time 0 0 0 0 12 13 13 13 13 13
Fire Rescue
Full-time 0 0 0 0 24 24 24 24 24 24
Part-Time 0 0 0 0 0 0 0 0 0 0
Community Development and Planning
Full-time 10 9 9 9 8 8 10 11 12 13
Part-Time 1 2 2 2 2 2 1 0 0 1
Leisure Services
Library
Full-time 7 6 6 6 6 6 6 7 7 7
Part-Time 8 10 10 10 10 10 10 9 9 9
Recreation
Full-time 17 9 7 6 6 6 6 6 6 6
Part-Time 42 42 42 43 43 43 43 43 43 43
Other Government - Country Club
Full-time 18 5 5 7 5 6 8 8 8 5
Part-Time 22 21 21 64 56 54 65 65 65 27
268 236 234 279 268 268 282 275 276 241
* Variance exists due to the employment of seasonal and part-time employees.
Source:Village of North Palm Beach Budget Report
VILLAGE OF NORTH PALM BEACH
LAST TEN FISCAL YEARS (*)
Full-Time Equivalent Village Government Employees by Function
Total Number of Employees Budgeted FY Ending
106
2008 2009 2010 2011 2012 2013 2014 2015 2016 2017
FUNCTION/PROGRAM
PUBLIC WORKS
Sanitation (Tons of Refuse Collected)11,974 10,667 10,165 9,962 10,065 10,720 10,720 11,167 12,556 12,980
No. of collection units for solid waste (residential) 7,163 7,214 7,070 7,071 7,076 7,471 7,616 7,618 7,614 7,614
Number of vehicles maintained 104 110 110 98 98 111 98 98 92 85
Number of repair overlays completed (miles)3 2.5 2.71 - - - - - - -
POLICE
Number of arrests by police officers 549 448 402 260 211 216 238 293 247 233
Number of traffic citations issued 5,520 6,305 4,951 2,564 2,566 1,254 2,799 3,407 2,494 1,974
FIRE RESCUE
EMS average response times (minutes)5.17 5.01 5.12 5.19 5.26 5.11 5.10 5.05 5.26 5.21
Number of EMS calls 1,114 1,214 1,146 1,179 1,326 1,296 1,110 1,499 1,601 1,746
COMMUNITY DEVELOPMENT & PLANNING
Building Department - Number of Permits 1,619 1,548 1,744 1,616 1,835 2,480 2,103 3,920 4,242 4,665
Number of code enforcement violations 729 613 391 575 817 790 887 769 680 **516/357
Number of code violations brought to board/magistrate
(Calendar Yr End)115 73 38 72 100 62 28 56 42 98
RECREATION
Number of community events presented 23 28 28 38 49 37 53 57 48 40
Number of registrants in athletic programs 1,400 1,125 1,005 1,260 1,311 2,074 1,439 1,389 1,174 1,109
LIBRARY
Library - Number of Volumes 33,122 35,681 39,277 40,658 43,340 44,966 46,546 47,339 *57,935 41,161
OTHER GOVERNMENT
Country Club
Number of Golf Members 389 297 354 298 283 262 250 255 265 271
Number of Tennis Members 171 180 184 173 162 190 194 193 183 183
Source: Village of North Palm Beach
U.S. Census Bureau
Property Appraiser
*Beginning in FY 2016 Number of Volumes includes not only printed items, but media items as well.
**Includes only the number of violations/cases opened and not a reflection of the total number of open violations as was reported for years prior to 2017
VILLAGE OF NORTH PALM BEACH
OPERATING INDICATORS BY FUNCTION/PROGRAM
LAST TEN FISCAL YEARS
107
2008 2009 2010 2011 2012 2013 2014 2015 2016*2017
Function/Program:
General Government
No. of General Government Buildings 11 23 23 23 23 23 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 32.30**32.30
Number of Street Lights (within corp surroundings)513 513 513 513 513 513 513 513 513 628****
Public Safety
Fire:1
Number of Stations 1 1 1 1 1 1 1 1 1 0
Number of Firemen/Paramedics/EMTs 0 0 0 0 0 0 0 0 0 24
Number of Fire Captains 23 23 23 23 22 22 22 22 23 0
Police/EMS Protection:
Number of Stations 1 1 1 1 1 1 1 1 1 1
Number of Policemen & Officers 32 31 31 31 28 28 28 28 28 28
Number of Police Captains 0 0 0 0 2 2 2 2.5 2.5 2.5
Leisure Services
Recreation
Number of Parks 4 4 4 4 4 4 4 4 4 4
Public Tennis Courts 2 2 2 2 2 2 2 2 2 2
Swimming Pool 1 1 1 1 1 1 1 1 1 1
Number of Marinas 1 1 1 1 1 1 1 1 1 1
Library
Number of Libraries 1 1 1 1 1 1 1 1 1 1
Number of Volumes (Printed items only)33,122 35,681 39,277 40,658 43,340 44,966 46,546 47,339 48,913 33,502
Other Government
Country Club
Golf Course 1 1 1 1 1 1 1 1 1 1
Driving Range 1 1 1 1 1 1 1 1 1 1
Tennis Courts 10 10 10 10 10 10 10 10 10 10
Restaurant 0 0 1 1 1 1 1 1 1 1***
Snack Bar 0 0 1 1 1 1 1 1 1 1***
Source: Village of North Palm Beach
*Preliminary 2016 information is presented
**A Centerline Miles Study was completed during FY 2016 and the number of NPB Village centerline miles from the report is presented.
***Restaurant services closed on 10/01/2016
****173 Village owned/455 FPL owned
VILLAGE OF NORTH PALM BEACH
LAST TEN FISCAL YEARS
CAPITAL ASSET STATISTICS BY FUNCTION/PROGRAM
108
OTHER REPORTS
109
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
The Honorable Mayor and Members of the Village Council
The Village of North Palm Beach, Florida
We have audited, in accordance with the auditing standards generally accepted in the United
States of America and the standards applicable to financial audits contained in Government
Auditing Standards, issued by the Comptroller General of the United States, 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, 2017, and the related notes to the financial statements, which
collectively comprise the Village of North Palm Beach, Florida’s basic financial statements and
have issued our report thereon dated March 7, 2018.
Internal Control Over Financial Reporting
In planning and performing our audit of the financial statements, we considered the Village of
North Palm Beach, Florida’s internal control over financial reporting (internal control) to
determine the audit procedures that are appropriate in the circumstances 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.
Accordingly, we do not express an opinion on the effectiveness of the Village of North Palm
Beach, Florida’s internal control.
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. A significant deficiency is a deficiency, or a
combination of deficiencies, in internal control that is less severe than a material weakness, yet
important enough to merit attention by those charged with governance.
110
Our consideration of internal control was for the limited purpose described in the first paragraph
of this section and was not designed to identify all deficiencies in internal control that might be
material weaknesses or significant deficiencies. Given these limitations, during our audit we did
not identify any deficiencies in internal control that we consider to be material weaknesses.
However, material weaknesses may exist that have not been identified.
Compliance and Other Matters
As part of obtaining reasonable assurance about whether the Village of North Palm Beach,
Florida’s financial statements are free from 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.
Purpose of this Report
The purpose of this report is solely to describe the scope of our testing of internal control and
compliance and the results of that testing, and not to provide an opinion on the effectiveness of
the entity’s internal control or on compliance. This report is an integral part of an audit
performed in accordance with Government Auditing Standards in considering the entity’s
internal control and compliance. Accordingly, this communication is not suitable for any other
purpose.
West Palm Beach, Florida
March 7, 2018
111
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
The Village of North Palm Beach, Florida
Report on the Financial Statements
We have audited the financial statements of the Village of North Palm Beach, Florida, as of and for
the fiscal year ended September 30, 2017, and have issued our report thereon dated March 7, 2018.
Auditor’s Responsibility
We conducted our audit in accordance with auditing standards generally accepted in the United
States of America; the standards applicable to financial audits contained in Government Auditing
Standards, issued by the Comptroller General of the United States, and Chapter 10.550, Rules of
the Florida Auditor General.
Other Reports
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 and Independent Accountant’s Report on an
examination conducted in accordance with AICPA Professional Standards, Section 601, regarding
compliance requirements in accordance with Chapter 10.550, Rules of the Auditor General.
Disclosures in those reports, which are dated March 7, 2018, should be considered in conjunction
with this management letter.
Prior Audit Findings
Section 10.554(1)(i)1., Rules of the Auditor General, requires that we determine whether or not
corrective actions have been taken to address findings and recommendations made in the preceding
annual financial audit report. There were no findings or recommendations in the prior year that
required corrective actions.
112
Official Title and Legal Authority
Section 10.554(1)(i)4., Rules of the Auditor General, requires that the name or official title and
legal authority for the primary government and each component unit of the reporting entity be
disclosed in this Management Letter, unless disclosed in the notes to the financial statements. This
information is disclosed in Note 1 to the financial statements.
Financial Condition
Sections 10.554(1)(i)5.a. and 10.556(7), Rules of the Auditor General, require that we apply
appropriate procedures and report the results of our determination as to whether or not the
Village of North Palm Beach, Florida 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, we determined that the Village of North Palm Beach, Florida did not meet any of the
conditions described in Section 218.503(1), Florida Statutes, during the fiscal year ended
September 30, 2017.
Pursuant to Sections 10.554(1)(i)5.c. and 10.556(8), Rules of the Auditor General, we applied
financial condition assessment procedures. It is management’s responsibility to monitor the
Village of North Palm Beach, Florida’s financial condition, and our financial condition
assessment was based in part on representations made by management and the review of
financial information provided by same. Our assessment was done as of the fiscal year end. The
results of our procedures did not disclose any matters that are required to be reported.
Section 10.554(1)(i)2., Rules of the Auditor General, requires that we communicate any
recommendations to improve financial management. In connection with our audit, we did not have
any such recommendations.
Annual Financial Report
Sections 10.554(1)(i)5.b. and 10.556(7), Rules of the Auditor General, require that we report the
results of our determination as to whether the annual financial report for the Village of North Palm
Beach, Florida for the fiscal year ended September 30, 2017, 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, 2017. In connection with our
audit, we determined that these two reports were in agreement.
Special District Component Units
Section 10.554(1)(i)5.d., Rules of the Auditor General, requires that we determine whether or not
a special district that is a component unit of a county, municipality, or special district, provided the
financial information necessary for proper reporting of the component unit, within the audited
financial statements of the county, municipality, or special district in accordance with Section
218.39(3)(b), Florida Statutes.
113
Based on the application of criteria in publications cited in Section 10.553, Rules of the Auditor
General, there are no special district component units of the Village of North Palm Beach, Florida.
Section 10.554(1)(i)3., Rules of the Auditor General, requires that we address noncompliance with
provisions of contracts or grant agreements, 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 which
warrants the attention of those charged with governance. In connection with our audit, we did not
have any such findings.
Single Audits
The Village expended less than $750,000 of federal awards and less than $750,000 of state
financial assistance for the year ended September 30, 2017, and was not required to have a federal
single audit or a state single audit.
Response to Management Letter
There were no items that required a response by management.
Purpose of this Letter
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 entities, and is not intended to be and should not be used by
anyone other than these specified parties.
March 7 2018
West Palm Beach, Florida
114
INDEPENDENT ACCOUNTANT’S REPORT
ON COMPLIANCE WITH SECTION 218.415,
FLORIDA STATUTES
The Honorable Mayor and Members of the Village Council
The Village of North Palm Beach, Florida
We have examined the Village of North Palm Beach, Florida’s compliance with Section 218.415,
Florida Statutes during the year ended September 30, 2017. Management of the Village of North Palm
Beach, Florida is responsible for the Village of North Palm Beach, Florida’s compliance with the
specified requirements. Our responsibility is to express an opinion on the Village of North Palm Beach,
Florida’s compliance with the specified requirements based on our examination.
Our examination was conducted in accordance with attestation standards established by the American
Institute of Certified Public Accountants. Those standards require that we plan and perform the
examination to obtain reasonable assurance about whether the Village of North Palm Beach, Florida
complied, in all material respects, with the specified requirements referenced above. An examination
involves performing procedures to obtain evidence about whether the Village of North Palm Beach,
Florida complied with the specified requirements. The nature, timing, and extent of the procedures
selected depend on our judgement, including an assessment of the risk of material noncompliance,
whether due to fraud or error. We believe that the evidence we obtained is sufficient and appropriate to
provide a reasonable basis for our opinion.
Our examination does not provide a legal determination on the Village of North Palm Beach, Florida’s
compliance with the specified requirements.
In our opinion, the Village of North Palm Beach, Florida complied, in all material respects, with Section
218.415, Florida Statutes for the year ended September 30, 2017.
This report is intended solely for the information and use of the Legislative Auditing Committee,
members of the Florida Senate and Florida House of Representatives, the Florida Auditor General,
applicable management, and the Village Council, and is not intended to be and should not be used by
anyone other than these specified parties.
West Palm Beach, Florida
March 7, 2018