FY 2018 CAFRVillage of North Palm Beach, FL
Comprehensive Annual
Financial Report
Fiscal year ended September 30, 2018
The Village of
North Palm Beach, Florida
COMPREHENSIVE ANNUAL FINANCIAL REPORT
Fiscal Year Ended September 30, 2018
Prepared by:
Finance Department
Samia Janjua
Director of Finance
THE VILLAGE OF NORTH PALM BEACH, FLORIDA
FINANCIAL STATEMENTS
SEPTEMBER 30, 2018
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 Auditor’s 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 Changes in Total OPEB liability ....................................................................................... 77
Schedule of Changes in Net Pension Liability – General Employees Retirement Fund ....................... 78
Schedule of Changes in Net Pension Liability – Fire and Police Retirement Fund .............................. 79
Schedules Contributions and Investment Returns – Retirement Funds ............................................... 80
Notes to the Schedule of Contributions ................................................................................................ 81
Schedule of Revenues, Expenditures, and Changes in Fund Balance -
Budget and Actual - General Fund ................................................................................................. 82
Notes to the Budgetary Required Supplementary Information ............................................................ 83
THE VILLAGE OF NORTH PALM BEACH, FLORIDA
FINANCIAL STATEMENTS
SEPTEMBER 30, 2018
TABLE OF CONTENTS
(Continued)
OTHER SUPPLEMENTARY INFORMATION:
Schedule of Departmental Expenditures– Budget and Actual – General Fund .................................... 84
Combining Balance Sheet – Nonmajor Governmental Funds .............................................................. 87
Combining Statement of Revenues, Expenditures, and Changes in Fund Balances -
Nonmajor Governmental Funds ........................................................................................................ 88
Combining Statement of Net Position – Pension Trust Funds .............................................................. 89
Combining Statement of Changes in Fiduciary Net Position – Pension Trust Funds ........................... 90
Combining Statement of Agency Net Position .................................................................................... 91
Combining Schedule of Changes in Agency Net Position .................................................................... 92
Schedule of Revenues and Departmental Expenses –
Budget and Actual – Country Club Fund – Budgetary Basis ............................................................ 93
STATISTICAL SECTION
Net Position by Component ................................................................................................................. 94
Changes in Net Position ....................................................................................................................... 95
Fund Balances, Governmental Funds ................................................................................................... 97
Changes in Fund Balances, Governmental Funds ................................................................................ 98
Net Assessed Value and Estimated Actual Value of Taxable Property ............................................. 100
Property Tax Rates - Direct and Overlapping Governments............................................................... 101
Principal Property Taxpayers ............................................................................................................. 102
Property Tax Levies and Collections ................................................................................................. 103
Ratios of Outstanding Debt by Type ................................................................................................... 104
Direct and Overlapping Governmental Activities Debt ...................................................................... 105
Pledged-Revenue Coverage ................................................................................................................ 106
Demographic and Economic Statistics ................................................................................................ 107
Principal Employers ........................................................................................................................... 108
Full-Time Equivalent Village Government Employees by Function .................................................. 109
Operating Indicators by Function/Program ........................................................................................ 110
Capital Asset Statistics by Function/Program ..................................................................................... 111
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 ................................ 112
Management Letter in Accordance with the Rules of the Auditor General of the
State of Florida ............................................................................................................................... 114
Independent Accountant’s Report on Compliance with
Section 218.415, Florida Statutes .................................................................................................... 117
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 28, 2019
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, 2018.
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, 2018. 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).
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The level of budgetary control (that is, the level at which management cannot overspend the budget
without the approval of the Village Council) 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 63% of the annual budget is allotted for wages and fringe benefits.
INITIATIVES AND FUTURE PROJECTS
The FY 2019 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 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. The Village is actively implementing the Master Plan strategies
as well as undertaking additional planning initiatives to include the Evaluation and Appraisal Report for
the Comprehensive Plan. Significant initiatives include the creation of a form-based code to encourage
redevelopment in the Village’s commercial corridors, which will be completed in 2019, the study of the
US1 Corridor to determine if two of the roadway’s six lanes should be repurposed for landscaping and/or
bicycle and pedestrian traffic and the redesign of the US1 and Prosperity Farms Road Bridges to serve
as architectural features signaling the entry into the community.
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 Department will review all of its
programming and facilities as part of a Parks and Recreation Master Plan, which is scheduled to be
completed during the fiscal year.
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 parks improvements in the five (5) year Capital
Improvement Plan (CIP).
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 concepts. 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.
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. 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.
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
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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 is undergoing 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 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 Clubhouse will be opened by October, 2019. The Golf Operations Department also
worked 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 $1.7 million. The driving range opened in
February, 2019. The course opened to members and guests in mid-March and will open to the public on
April 1, 2019.
For Fiscal Year 2018-2019, 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. Financial Sustainability
2. Beautification and Quality of Life
3. All Neighborhoods as Desirable Places to Live
4. Waterways and Recreation
5. Strong Local Economy
6. Improve Mobility
7. Organizational Excellence
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, 2017, the 30th
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.
vii
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, 2017, the 10th 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, 2018
Title Name
Mayor David B. Norris
Vice Mayor Mark Mullinix
President Pro Tem Susan Bickel
Council Member Darryl C. Aubrey
Council Member Deborah Searcy
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, 2017
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, 2018, 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, 2018, 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.
Change in Accounting Principal
As discussed in Note 18 to the financial statements, the Village of North Palm Beach, Florida
implemented Governmental Accounting Standards Board Statement No. 75, Accounting and
Financial Reporting for Postemployment Benefits Other Than Pensions, during the fiscal year
ended September 30, 2018. The beginning net position of the governmental activities, the
business-type activities, and the Enterprise Fund as of October 1, 2017 has been restated. Our
opinions are not modified with respect to this matter.
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 77 through 81, and budgetary comparison
information on pages 82 through 83 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.
3
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.
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 11, 2019, 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 the effectiveness of the Village of
North Palm Beach, Florida’s 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 11, 2019
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, 2018. 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
2018 2017 (Decrease)Page #
Total net position $24.30 $23.36 $0.94 14
Unrestricted net position available for future use $6.71 $6.90 ($0.19)14
Governmental net position $22.57 $21.01 $1.56 14
Total revenues from all sources $28.40 $26.25 $2.15 15
Governmental revenues $26.13 $23.29 $2.84 15
Total cost of all Village programs $27.10 $26.36 $0.74 15
Governmental revenues over (under) expenses $1.94 ($0.17)$2.11 16
General fund revenues over (under) expenses $1.11 $0.76 $0.35 19
General fund unassigned fund balance $7.28 $11.81 ($4.53)17
As a percent of general fund expenditures 30.92%54.99%-24.07%
Country Club revenues over (under) expenses ($0.64)$0.05 ($0.69)22
Change in total long-term debt for the Village ($0.99)$14.56 ($15.55)
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 $24.30 million at the close of the most recent
fiscal year.
A significant portion of the Village's net position (70.42%) reflects its investment in capital assets (e.g.,
land, buildings, machinery, and equipment), less any related debt still outstanding, which was used to
acquire those assets. The Village uses these capital assets to provide services to citizens; consequently,
these assets are not available for future spending.
7
Table 2
Village of North Palm Beach
Net Position
(In Thousands)
Governmental Business-type
Activities Activities Total
2018 2017 2018 2017 2018 2017
Assets:
Current and other assets 28,457$ 30,326$ (1,053)$ 655$ 27,404$ 30,981$
Capital assets 18,361 14,479 4,996 4,238 23,357 18,717
Total assets 46,818 44,805 3,943 4,893 50,761 49,698
Deferred outflows of resources:2,782 4,044 2,782 4,044
Liabilities:
Current liabilities 2,030 1,248 161 149 2,191 1,397
Long-term liabilities 20,973 24,720 1,996 2,391 22,969 27,111
Total liabilities 23,003 25,968 2,157 2,540 25,160 28,508
Deferred inflows of resources:4,025 1,867 54 4,079 1,867
Net positon:
Net investement in capital assets 15,429 13,485 1,685 1,991 17,114 15,476
Restricted 485 992 485 992
Unrestricted 6,659 6,536 46 362 6,705 6,898
Total net position 22,573$ 21,013$ 1,731$ 2,353$ 24,304$ 23,366$
Governmental Activities
The cost of all governmental activities this year was $24.19 million. As shown on Table 3, Changes in
Net Position, those who directly benefited from the programs paid for $3.57 million of this cost and
$22.56 million was financed through general revenues. Governmental activities increased the Village's
net position by $1.94 million, thereby accounting for 100% of the total increase in the net position of the
Village.
Additional detail is shown in Table 3, which follows on the subsequent page.
8
Table 3
Village of North Palm Beach
Changes in Net Position
(In Thousands)
Activities Total
2018 2017 2018 2017 2018 2017
Revenues:
Program revenues:
Charges for services 3,571$ 3,484$ 2,255$ 2,946$ 5,826$ 6,430$
Operating grants and contributions 422 377 422 377
Capital grants and contributions 10 102 10 102
General revenues:
Property taxes 15,003 13,092 15,003 13,092
Local option gas taxes 302 306 302 306
Local option infrastructure surtax 880 553 880 553
Utility service taxes 2,512 2,414 2,512 2,414
Sales and use taxes 1,413 1,371 1,413 1,371
Franchise taxes 1,294 1,307 1,294 1,307
Investment earnings 376 127 14 10 390 137
Miscellaneous 269 151 269 151
Gain on asset disposals 75 7 75 7
Total revenues 26,127 23,291 2,269 2,956 28,396 26,247
Expenses:
Program expenses:
General Government 3,214 3,206 3,214 3,206
Public Safety 10,046 9,906 10,046 9,906
Public Works 5,911 5,707 5,911 5,707
Community Development 1,459 1,255 1,459 1,255
Leisure Services 3,058 3,115 3,058 3,115
Interest on long-term debt 500 267 500 267
Country Club 2,913 2,903 2,913 2,903
Total expenses 24,188 23,456 2,913 2,903 27,101 26,359
Increase (decrease) in net position 1,939 (165) (644) 53 1,295 (112)
Net position - beginning of year (1)20,634 21,178 2,376 2,300 23,010 23,478
Net position - end of year 22,573$ 21,013$ 1,732$ 2,353$ 24,305$ 23,366$
(1) As restated
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 3,214$ (2,997)$ 3,206$ (3,068)$
Public safety 10,046 (9,179)9,906 (9,013)
Public works 5,911 (5,385)5,707 (5,124)
Community development 1,459 37 1,255 (32)
Leisure services 3,058 (2,160)3,115 (1,988)
Interest on long-term debt 500 (500)267 (267)
24,188$ (20,184)$ 23,456$ (19,492)$
2018 2017
At the end of the current year, as compared to the prior year, the total cost of services increased by $0.73
million. This increase is primarily due to increased interest and personnel related costs.
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 $0.69 million and expenses increased by $0.01 million. Net positon
of the Proprietary Fund (Country Club) at September 30, 2018, were $1.73 million. Net position
decreased by $0.64 million.
The negative impact in the Village’s Business-type activities was largely due to the Country Club
clubhouse construction and golf course renovation projects. The closure of both facilities disrupted the
Country Club’s ability to deliver services and resulted in significant revenue loss in the Country Club.
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 $26.36
million, a $2.78 million decrease from the 2017 fund balance of $29.14 million. Approximately 49% of
the combined ending fund balance ($12.97 million) constitutes unrestricted (unassigned/assigned) fund
balance, which is available for spending at the government's discretion. The remainder of fund balance
($13.39 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 $7.28 million while the General Fund total fund
balance was $9.24 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 31% of total general fund expenditures, while total fund balance represents 39% of that same amount.
The general fund unassigned fund balance ($7.28 million) represents a decrease of $4.53 million from the
2017 unassigned general fund balance of $11.81 million. Key elements of this decrease are listed below:
• Use of General Fund Unassigned Fund Balance (General Fund Reserves) to finance a portion of
the following projects:
o Country Club Clubhouse project ($3.92 million)
o Public Safety Roof project ($0.39 million)
• The repayment schedule on the $15 million loan to reconstruct the clubhouse began this fiscal
year. Without revenues from the operation of the Country Club, the General Fund is temporarily
servicing the debt on its own.
11
General Fund Budgetary Highlights
Differences between the original budget and the final amended budget were $5,527,789 and can be briefly
summarized as follows:
• Grant Match ($50,000)
• Prior Year Open Purchase Order Carryover ($755,281)
• Use of Developer Fees ($252,000)
• Transfers out to the Capital Projects Fund to provide funding for the following projects:
o Public Safety Roof project ($547,981)
o Country Club Clubhouse project ($3,922,527)
General Fund Budget Analysis
As shown on pages 84-86 of this report, in the Schedule of Departmental Expenditures – Budget and
Actual, there was an overall favorable budget to actual cost variance of $518,076 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 ($391,427); savings in personnel costs ($77,928) as a
result of several position vacancies; and savings in operating costs ($117,686) as a result of departments
holding the line on operating costs.
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 $17.07
million, a $1.96 million increase over the 2017 fund balance of $15.10 million. This is primarily due to a
transfer in from the General Fund unassigned fund balance 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 is 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 $0.16 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, 2018 and 2017 amounts to $23.36 million and $18.72 million, respectively (net of
accumulated depreciation).
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Table 5
Village of North Palm Beach
Capital Assets
(In Thousands)
Governmental Business-type
Activities Activities Total
2018 2017 2018 2017 2018 2017
Land 2,056$ 2,056$ 1,051$ 1,051$ 3,107$ 3,107$
Construction in progress 5,334 1,171 1,591 228 6,925 1,399
Buildings and improvements 23,973 23,577 6,538 7,551 30,511 31,128
Furniture, fixtures and equipment 8,253 8,072 212 308 8,465 8,380
Total assets 39,616 34,876 9,392 9,138 49,008 44,014
Less accumulated depreciation (21,255) (20,397) (4,396)(4,900)(25,651) (25,297)
Net position 18,361$ 14,479$ 4,996$ 4,238$ 23,357$ 18,717$
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 $16.26 million; $14.32 million in the governmental activities
and $1.94 million in business-type activities. None of the Village’s long-term debt comprises debt
backed by the full faith and credit of the government.
Table 6
Village of North Palm Beach
Outstanding Debt
(In Thousands)
Governmental Business-type
Activities Activities Total
2018 2017 2018 2017 2018 2017
Loans payable 14,320$ 15,000$ 1,939$ 2,247$ 16,259$ 17,247$
Total 14,320$ 15,000$ 1,939$ 2,247$ 16,259$ 17,247$
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 decreased to $7.28 million during the current 2018
fiscal year. The decrease is primarily due to providing additional funds for the Country Club Clubhouse
Project.
The FY 2018/19 Budget reflects continued improvement to citizen services, public safety, and public
facility maintenance while emphasizing improved community appearance and financial stability. The
Village’s operating millage rate was increased from 7.3300 mils to 7.5000 mils. The millage increase
was approved as a means to address potential increases associated with public safety union contracts and
preparation for a significant revenue loss should Amendment 1 be approved by Florida voters.
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 completing the North
Palm Beach Country Club clubhouse construction and golf course renovation projects. Continued work
to build a new clubhouse and renovate the golf course will result in reduced Country Club revenues due to
the closure of both facilities at different times and the need for the General Fund to support debt service
associated with the projects until the Country Club returns to full operation. Increasing property
valuations and continued state and national economic growth, however, 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, 2018
Governmental Business-type
Activities Activities Total
Assets
Cash and cash equivalents 5,148,069$ 229,836$ 5,377,905$
Investments 9,117,772 9,117,772
Accounts receivable 411,407 363 411,770
Accrued interest 33,485 33,485
Inventories 133,878 79,985 213,863
Prepaids 6,408 8,296 14,704
Due from other governments 361,593 361,593
Internal balances 1,371,447 (1,371,447)
Restricted assets:
Cash and cash equivalents 3,926,016 3,926,016
Investments 7,947,338 7,947,338
Capital assets:
Nondepreciable 7,390,123 2,642,793 10,032,916
Depreciable (net of depreciation)10,970,575 2,353,288 13,323,863
Total assets 46,818,111 3,943,114 50,761,225
Deferred outflows of resources
Pension related items 2,782,318 2,782,318
Total deferred outflows of resources 2,782,318 2,782,318
Liabilities
Accounts payable 1,525,527 69,011 1,594,538
Accrued liabilities 213,316 213,316
Unearned revenue 137,417 92,450 229,867
Accrued interest payable 153,720 153,720
Noncurrent liabilities:
Due within one year 1,857,710 333,203 2,190,913
Due in more than one year 19,115,278 1,662,529 20,777,807
Total liabilities 23,002,968 2,157,193 25,160,161
Deferred inflows of resources
Deferred revenue 171,600 171,600
Other postemployement benefits related items 1,751,935 54,184 1,806,119
Pension related items 2,101,130 2,101,130
Total deferred inflows of resources 4,024,665 54,184 4,078,849
Net position
Net investment in capital assets 15,429,484 1,685,268 17,114,752
Restricted for:
Recreation 279,302 279,302
Infrastructure 158,123 158,123
Library 13,778 13,778
Other purposes 33,365 33,365
Unrestricted 6,658,744 46,469 6,705,213
Total net position 22,572,796$ 1,731,737$ 24,304,533$
See notes to the financial statements.
THE VILLAGE OF NORTH PALM BEACH, FLORIDA
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THE VILLAGE OF NORTH PALM BEACH, FLORIDA
Statement of Activities
For the Year Ended September 30, 2018
Charges for
Functions/Programs Expenses Services
Government:
Governmental activities
General government 3,213,886$ 140,998$
Public safety 10,045,757 548,019
Public works 5,911,225 510,732
Community development and planning 1,458,523 1,495,298
Leisure services 3,058,410 876,174
Interest expense 499,929
Total governmental activities 24,187,730 3,571,221
Business-type activities - country club 2,912,523 2,254,638
Total business-type activities 2,912,523 2,254,638
Total government 27,100,253$ 5,825,859$
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
75,654$ $ (2,997,234)$ $ (2,997,234)$
309,600 9,111 (9,179,027) (9,179,027)
15,394 (5,385,099) (5,385,099)
36,775 36,775
21,607 480 (2,160,149) (2,160,149)
(499,929) (499,929)
422,255 9,591 (20,184,663) (20,184,663)
(657,885)(657,885)
(657,885)(657,885)
422,255$ 9,591$ (20,184,663) (657,885) (20,842,548)
General Revenues:
Taxes:
Property taxes 15,003,141 15,003,141
Local option gas taxes 302,208 302,208
Local option infrastruture surtax 879,565 879,565
Utility service taxes 2,511,877 2,511,877
Franchise taxes 1,294,280 1,294,280
Sales and use taxes 1,413,335 1,413,335
Investment income - unrestricted 376,227 13,874 390,101
Miscellaneous 268,471 268,471
Gain on disposal of equipment 74,449 74,449
Total general revenues 22,123,553 13,874 22,137,427
Change in net position 1,938,890 (644,011) 1,294,879
Net position, beginning of year as restated 20,633,906 2,375,748 23,009,654
Net position, end of year 22,572,796$ 1,731,737$ 24,304,533$
See notes to the financial statements.
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THE VILLAGE OF NORTH PALM BEACH, FLORIDA
Balance Sheet
Governmental Funds
September 30, 2018
Infrastructure Capital Nonmajor Total
Surtax Projects Governmental Governmental
General Fund Fund Funds Funds
Assets
Cash and cash equivalents $ 67,151$ 4,744,105$ 336,813$ 5,148,069$
Investments 9,117,772 9,117,772
Accounts receivable 411,407 411,407
Accrued interest 33,485 33,485
Inventories 133,878 133,878
Prepaids 6,408 6,408
Due from other funds 1,144,535 1,144,535
Advances to other funds 1,371,447 1,371,447
Due from other governments 280,081 81,512 361,593
Restricted cash and cash equivalents 158,123 3,767,893 3,926,016
Restricted investments 47,338 7,900,000 7,947,338
Total assets 11,401,816$ 306,786$ 17,556,533$ 336,813$ 29,601,948$
Liabilities, deferred inflows of resources, and fund balances
Liabilities
Accounts payable 482,911$ 148,663$ 490,395$ 403,558$ 1,525,527$
Accrued liabilities 213,316 213,316
Due to other funds 1,100,507 44,028 1,144,535
Unearned revenue 137,417 137,417
Total liabilities 1,934,151 148,663 490,395 447,586 3,020,795
Deferred inflows of resources
Deferred revenue 171,600 171,600
Unavailable revenue 52,657 52,657
Total deferred inflows of resources 224,257 224,257
Fund balances
Nonspendable:
Inventories and prepaids 140,286 140,286
Advances to other funds 1,371,447 1,371,447
Restricted for:
Country club project 11,388,786 11,388,786
Recreation 195 279,107 279,302
Infrastructure 158,123 158,123
Streets and roads 25,645 25,645
Police 4,947 4,947
Library 13,778 13,778
Other purposes 2,773 2,773
Assigned for:
Small business grants 16,435 16,435
Subsequent year's expenditures 391,427 391,427
Special revenue funds 3,506 3,506
Capital project funds 5,398,245 5,398,245
Unassigned 7,276,475 (114,279)7,162,196
Total fund balances 9,243,408 158,123 17,066,138 (110,773)26,356,896
Total liabilities, deferred inflows of
resources, and fund balances 11,401,816$ 306,786$ 17,556,533$ 336,813$ 29,601,948$
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, 2018
Fund balances - total governmental funds 26,356,896$
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 39,615,919$
Less: accumulated depreciation (21,255,221)
18,360,698
Governmental funds report revenues when earned and available.
However, in the Statement of Activities, revenues are recongnized when
earned, regardlesss of availability.
Current year unavailable grant revenue 52,657
Accrued interest payable (153,720)
Revenue notes (14,320,000)
Net pension liability (3,843,124)
Other postemployement benefits (1,399,684)
Accrued compensated absences (1,410,180)
(21,126,708)
Other postemployement benefits deferred inflows (1,751,935)
Pension related deferred outflows 2,782,318
Pension related deferred inflows (2,101,130)
(1,070,747)
Net position of governmental activities 22,572,796$
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, 2018
Infrastructure Capital Nonmajor Total
Surtax Projects Governmental Governmental
General Fund Fund Funds Funds
Revenues
Taxes 19,111,506$ $ $ $ 19,111,506$
Licenses and permits 1,222,594 1,222,594
Intergovernmental 1,482,113 879,565 317,711 2,679,389
Charges for services 2,200,860 2,200,860
Fines and forfeitures 100,140 100,140
Investment 112,809 10,939 252,479 376,227
Miscellaneous 412,513 412,513
Total revenues 24,642,535 890,504 252,479 317,711 26,103,229
Expenditures
Current
General government 3,059,623 3,059,623
Public safety 9,360,761 308,600 9,669,361
Public works 5,313,834 5,313,834
Community development and planning 1,429,764 1,429,764
Leisure services - recreation 2,613,664 2,613,664
Capital outlay 457,783 1,286,985 3,203,984 558,865 5,507,617
Debt service
Principal 680,000 680,000
Interest 613,101 613,101
Total expenditures 23,528,530 1,286,985 3,203,984 867,465 28,886,964
Excess (deficiency) of revenues
over (under) expenditures 1,114,005 (396,481) (2,951,505) (549,754) (2,783,735)
Other financing sources (uses)
Transfers in 4,913,307 50,000 4,963,307
Transfers out (4,963,307) (4,963,307)
Total other financing sources (uses)(4,963,307) 4,913,307 50,000
Net change in fund balances (3,849,302) (396,481) 1,961,802 (499,754) (2,783,735)
Fund balances
Beginning of year 13,092,710 554,604 15,104,336 388,981 29,140,631
End of year 9,243,408$ 158,123$ 17,066,138$ (110,773)$ 26,356,896$
See notes to the financial statements.
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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, 2018
Net change in fund balances - total governmental funds (2,783,735)$
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 5,459,349$
Less: current year depreciation (1,548,008)
Net book value for retired assets (29,266)
3,882,075
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:
Principal payments on debt 680,000
Governmental funds report revenues when earned and
available. However, in the Statement of Activities, revenues are
recognized when earned, regardless of availability:
Current year unavailable grant revenue 52,657
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 113,172
Change in long-term compensated absences (74,399)
Change in net pension liability and related deferred amounts 106,407
Change in other postemployment benefits and deferred amounts (37,287)
107,893
Change in net position 1,938,890$
See notes to the financial statements.
20
THE VILLAGE OF NORTH PALM BEACH, FLORIDA
Statement of Net Position
Proprietary Fund
September 30, 2018
Enterprise
Assets
Current assets
Cash and cash equivalents 229,836$
Accounts receivable 363
Inventories 79,985
Prepaids 8,296
Total current assets 318,480
Non-current assets
Capital assets, net 4,996,081
Total non-current assets 4,996,081
Total assets 5,314,561
Liabilities
Current liabilities
Accounts payable 69,011
Unearned revenue 92,450
Compensated absences - current portion 12,526
Loans payable - current portion 320,677
Total current liabilities 494,664
Non-current liabilities
Other postemployement benefits 43,290
Compensated absences 550
Advances from other funds 1,371,447
Loans payable 1,618,689
Total non-current liabilities 3,033,976
Total liabilities 3,528,640
Deferred inflows of resources
Deferred revenueOther postemployement benefits related items 54,184
Net position
Net investment in capital assets 1,685,268
Unrestricted 46,469
Total net position 1,731,737$
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, 2018
Enterprise
Operating revenue
Greens fee/cart rentals/membership fees 1,743,759$
Golf shop revenues 217,147
Driving range revenues 276,244
Restaurant revenues
Miscellaneous 17,488
Total operating revenues 2,254,638
Operating expenses
Golf course maintenance expenses 1,159,941
Clubhouse grounds expenses 68,349
Golf shop expenses 811,743
Food and beverage expenses 46,201
Administrative and general 98,968
Insurance 42,711
Depreciation and amortization 323,964
Total operating expenses 2,551,877
Operating income (loss)(297,239)
Nonoperating revenues (expenses)
Interest revenue 13,874
Loss on disposal of equipment (262,426)
Interest expense (98,220)
Total nonoperating revenues (expenses)(346,772)
Change in net position (644,011)
Net position - beginning as restated 2,375,748
Net position - ending 1,731,737$
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, 2018
Enterprise
Cash flows from operating activities:
Receipts from customers 2,254,978$
Payments to suppliers for goods or services (1,662,403)
Payments to employees for services (530,354)
Net cash provided by operating activities 62,221
Cash flows from capital and related financing activities:
Advance from the general fund 1,363,664
Proceeds from the sale of capital assets 19,449
Principal paid on long term debt (307,722)
Interest paid on debt (90,437)
Acquisition of capital assets (1,363,664)
Net cash provided (used) by capital and related financing activities (378,710)
Cash flows from investing activities:
Interest and dividends on investments 13,874
Net increase (decrease) in cash and cash equivalents (302,615)
Cash and cash equivalents at beginning of year 532,451
Cash and cash equivalents at end of year 229,836$
Reconciliation of operating income
to net cash provided by operating activities:
Operating income (loss)(297,239)$
Adjustments to reconcile operating income
to net cash provided by operating activities:
Depreciation and amortization 323,964
Change in OPEB liability and related deferred amounts 1,154
Change in assets and liabilities
Decrease in accounts receivable 11,378
Decrease in inventory 20,652
Decrease in prepaids 1,722
Increase in accounts payable 23,431
Decrease in compensated absences payable (11,803)
Decrease in deferred revenue (11,038)
Total adjustments 359,460
Net cash provided by operating activities 62,221$
See notes to the financial statements.
23
THE VILLAGE OF NORTH PALM BEACH, FLORIDA
Statement of Fiduciary Net Position
Fiduciary Funds
September 30, 2018
Employee
Retirement Agency
Funds Funds
Assets
Cash and cash equivalents 771,513$ 373,617$
Investments:
Domestic common equity securities 11,860,443
International common equity securities 2,476,906
U.S. Government and agencies 2,515,737
Municipal bonds 282,652
Corporate bonds 2,973,597
Fixed income exchange traded funds 2,776,601
Equity exchange traded funds 3,378,078
Fixed income mutual funds 2,824,913
Equity mutual funds 7,098,518
Real estate investment fund 2,560,739
Money market mutual funds 1,560,240
Accrued interest and dividends 60,313
Accounts receivable 329,642
Prepaids 6,408
Total assets 41,476,300 373,617
Liabilities
Accounts payable 52,371
Due to others 373,617
Total liabilities 52,371 373,617
Net position restricted for pensions 41,423,929$ $
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, 2018
Employee
Retirement
Funds
Additions
Contributions
Employer 1,274,511$
Plan members 331,073
State on-behalf payments 308,600
Total contributions 1,914,184
Investment earnings
Dividends and interest 1,003,704
Net increase in fair value
of investments 2,049,428
Total investment earnings 3,053,132
Less: investment expenses 224,638
Total net investment earnings 2,828,494
Total additions 4,742,678
Deductions
Administrative expense 99,888
Benefits 1,223,344
Total deductions 1,323,232
Change in net position 3,419,446
Net position - beginning 38,004,483
Net position - ending 41,423,929$
See notes to the financial statements.
25
THE VILLAGE OF NORTH PALM BEACH, FLORIDA
Notes to the Basic Financial Statements
September 30, 2018
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, 2018
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 90 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, 2018
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, 2018
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, investments with Florida Prime managed by the State of Florida, State Board of
Administration and Florida Education Trust Fund (FEITF) sponsored by Florida School Boards
Association and the Florida Association of District School Superintendents
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, 2018
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 first-in, first-out basis (FIFO). 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, 2018
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.
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, 2018
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 three 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. The third is deferred OPEB items in connection to Other Post-
Employment Benefits. These items are amortized in a systemic and rational method and
recognized as a reduction of 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, 2018
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, 2018
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.
THE VILLAGE OF NORTH PALM BEACH, FLORIDA
Notes to the Basic Financial Statements
September 30, 2018
35
NOTE 2 – STEWARDSHIP, COMPLIANCE, AND ACCOUNTABILITY
A. Budgetary Data
Except for budgeting capital expenditures and not budgeting for depreciation, the annual
appropriated budgets for the Enterprise Funds are adopted on a basis consistent with generally
accepted accounting principles. For budgeting purposes, current year encumbrances are not
treated as expenditures.
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 $391,432 and the Capital Projects
Fund had $13,981,802 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, 2018
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, 2018, 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, 2018, unpaid delinquent
taxes are not material and have not been recorded by the Village.
NOTE 3 – DEPOSITS AND INVESTMENTS
Deposits
As of September 30, 2018, the carrying amount of the Village’s deposits (including fiduciary
funds) was $4,255,916 and the bank balances totaled $4,768,721. 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, 2018
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 $ 4,255,916
Petty cash 4,770
Investments 63,561,899
Total deposits and investments $67,822,585
Presented in the statement of net position
Governmental activities
Cash and cash equivalents $ 5,148,069
Restricted cash and cash equivalents 3,926,016
Investments 9,117,772
Restricted investments 7,947,338
Business-type activities
Cash and cash equivalents 229,836
Total statements of net position 26,369,031
Presented in the statement of fiduciary net
position
Pension trust funds
Cash and cash equivalents 771,513
Investments 40,308,424
Agency funds
Cash and cash equivalents 373,617
Total fiduciary funds 41,453,554
Total deposits and investments $67,822,585
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, 2018
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, 2018, 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, 2018
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 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 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 Village’s investments in FEITF Term Series are as follows:
Maturity Interest Rate Amount
12/31/18 2.24% $ 1,500,000
01/13/19 2.35% 1,900,000
02/28/19 2.41% 2,100,000
03/29/19 2.44% 2,400,000
$ 7,900,000
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, 2018
40
NOTE 3 – DEPOSITS AND INVESTMENTS (Continued)
Investments (Continued)
As of September 30, 2018, 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 2.09 Years $ 3,520,535 $ $ 3,520,535
Asset Backed Securities 3.39 Years 1,632,519 1,632,519
Municipal Bonds 1.38 Years 279,056 279,056
Domestic Corporate Bonds 1.77 Years 1,903,068 1,903,068
International Corporate Bonds 1.73 Years 1,810,438 1,810,438
Fiduciary Funds
U.S. Government and Agency 9.24 Years 940,238 940,238
Asset Backed Securities 19.81 Years 1,575,499 1,575,499
Municipal Bonds 11.80 Years 282,652 282,652
Domestic Corporate Bonds 8.13 Years 2,382,594 2,382,594
International Corporate Bonds 5.94 Years 591,003 591,003
Domestic Common Equity
Securities N/A 11,860,443 11,860,443
International Common Equity
Securities N/A 2,476,906 2,476,906
Fixed Income ETF N/A 2,776,601 2,776,601
Equity ETF N/A 3,378,078 3,378,078
Fixed Income Mutual Funds N/A 2,824,913 2,824,913
Equity Mutual Funds N/A 7,098,518 7,098,518
45,333,061 $ 30,415,459 $ 14,917,602
Investments Reported at NAV
Governmental Funds
FEITF Term Series N/A 7,900,000
Fiduciary Funds
American Core Realty Fund N/A 2,560,739
Investments Reported at
Amortized Cost:
Governmental Funds
Money Market Mutual Funds N/A 19,494
Florida Prime 72 Days 695,009
FEITF 37 Days 5,188,054
Fiduciary Funds
Money Market Mutual Funds N/A 1,865,542
Total Investments $ 63,561,899
THE VILLAGE OF NORTH PALM BEACH, FLORIDA
Notes to the Basic Financial Statements
September 30, 2018
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 $ 3,520,535
Asset Backed Securities AAA & NR Aaa & NR 1,632,519
Municipal Bonds AA- Aa3 279,056
Domestic Corporate Bonds AAA to BBB+ Aaa to A3 1,903,068
International Corporate Bonds AAA to A- Aaa to A1 1,810,438
Money Market Mutual Funds NR NR 19,494
Florida Prime AAAm NR 695,009
FEITF AAAm NR 5,188,054
FEITF Term Series NR* NR 7,900,000
Fiduciary Funds
U.S. Government and Agency AA+ Aaa 940,238
Asset Backed Securities NR Aaa 1,575,499
Municipal Bonds AAA to AA- Aaa to Aa3 282,652
Domestic Corporate Bonds AAA to BBB- Aaa to Baa3 2,382,594
International Corporate Bonds AAA to A- Aaa to A1 591,003
Common Equity Securities NR NR 14,337,349
Exchange Traded Funds NR NR 6,154,679
Mutual Funds NR NR 9,923,431
American Core Realty Fund NR NR 2,560,739
Money Market Mutual Funds NR NR 1,865,542
Total Investments $ 63,561,899
* 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, 2018
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, 2018
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, 2018
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, 2018
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, 2018
46
NOTE 4 – RECEIVABLES
Receivables at September 30, 2018, were as follows:
General
Fund
Country
Club
Utility franchise fees & taxes $ 390,472 $
Conroy Drive assessment 2,777
Other accounts receivable 18,158 363
Total accounts receivable $ 411,407 $ 363
NOTE 5 – CAPITAL ASSETS
Capital Assets activity for the year ended September 30, 2018, 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 1,170,985 4,163,249 5,334,234
Capital assets being depreciated:
Buildings 9,367,764 9,367,764
Improvements 14,208,994 456,408 (60,750) 14,604,652
Machinery and equipment 3,034,715 99,352 (266,995) 2,867,072
Vehicles 5,037,495 740,340 (391,527) 5,386,308
Total at historical cost: 34,875,842 5,459,349 (719,272) 39,615,919
Less accumulated depreciation for:
Buildings (5,934,684) (260,280) (6,194,964)
Improvements (9,403,003) (708,266) 55,319 (10,055,950)
Machinery and equipment (1,999,698) (174,499) 250,391 (1,923,806)
Vehicles (3,059,834) (404,963) 384,296 (3,080,501)
Total accumulated depreciation (20,397,219) (1,548,008) 690,006 (21,255,221)
Governmental activities capital
assets, net $ 14,478,623 $ 3,911,341 $ (29,266)
$
$ 18,360,698
THE VILLAGE OF NORTH PALM BEACH, FLORIDA
Notes to the Basic Financial Statements
September 30, 2018
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 423,542
Public works 582,110
Community development 21,648
Leisure services 431,688
Total depreciation expense, governmental activities $ 1,548,008
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 1,363,664 1,591,482
Capital assets being depreciated:
Buildings 1,405,035 (939,913) 465,122
Improvements 6,146,307 (73,228) 6,073,079
Machinery and equipment 244,567 (82,147) 162,420
Vehicles 63,700 (14,546) 49,154
Total at historical cost: 9,138,738 1,363,664 (1,109,834) 9,392,568
Less accumulated depreciation for:
Buildings (1,112,996) (23,840) 671,714 (465,122)
Improvements (3,501,088) (293,433) 61,218 (3,733,303)
Machinery and equipment (227,112) (3,467) 80,482 (150,097)
Vehicles (59,286) (3,224) 14,545 (47,965)
Total accumulated depreciation (4,900,482) (323,964) 827,959 (4,396,487)
Business-type activities capital
assets, net $ 4,238,256 $ 1,039,700 $ (281,875)
$
$ 4,996,081
THE VILLAGE OF NORTH PALM BEACH, FLORIDA
Notes to the Basic Financial Statements
September 30, 2018
48
NOTE 6 – LONG TERM LIABILITIES
Change in Long-Term Liabilities
Long-term liability activity for the year ended September 30, 2018, was as follows:
Beginning
Balance Additions Reductions
Ending
Balance
Amount
Due
Within
One Year
Governmental activities:
Loans payable $ 15,000,000 $ $ (680,000) $ 14,320,000 $ 805,000
OPEB(1) (see Note 13) 3,114,332 (1,714,648) 1,399,684
Net pension liability
(see Note 8) 5,649,589 (1,806,465) 3,843,124
Compensated absences
payable 1,335,781 1,145,773 (1,071,374) 1,410,180 1,052,710
Total $ 25,099,702 $ 1,145,773 $(5,272,487) $ 20,972,988 $ 1,857,710
Business-type activities:
Loans payable $ 2,247,088 $ $ (307,722) $ 1,939,366 $ 320,677
OPEB(1) (see Note 13) 96,320 (53,030) 43,290
Compensated absences
payable 24,879 29,830 (41,633) 13,076 12,526
Total $ 2,368,287 $ 29,830 $ (402,385) $ 1,995,732 $ 333,203
(1) As restated, see note 18
Governmental activities other postemployment benefit obligations, compensated absences and
net pension liabilities are expected to be paid out of the general fund.
Loans Payable
$4,893,673 Promissory Notes
The Village Council adopted Resolution No. 23-2006 authorizing the issuance of a note in the
amount of $4,893,673 to finance certain capital expenditures relating to the municipal golf
course and country club. The revenues of the Country Club are pledged to secure the loan.
Principal and interest payments are due semi-annually in the amount of $199,079, with a final
maturity date of April 1, 2024. The interest rate on the loan is 4.11% and is subject to
adjustment in the event of taxability of the interest on this note. As of September 30, 2018, the
principal amount outstanding was $1,939,366 and was for the purpose of business-type activities.
THE VILLAGE OF NORTH PALM BEACH, FLORIDA
Notes to the Basic Financial Statements
September 30, 2018
49
NOTE 6 – LONG TERM LIABILITIES (Continued)
$4,893,673 Promissory Notes (Continued)
Annual debt service requirements to maturity are as follows:
Business-type activities:
Year Ending Principal Interest Total
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 378,185 19,974 398,159
2024 195,369 4,074 199,443
$ 1,939,366 $ 250,872 $ 2,190,238
The loan agreement requires that pledged revenues cover 100% of the debt service due plus the
expenses, other than non-cash expenses, of owning and operating the Country Club. Due to the
Golf Course and Country Club being closed for part of the year for renovations pledged revenues
were short $357,560.
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,
2018, 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, 2018
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, 2018, the principal amount outstanding was $5,420,000 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
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 935,000 359,981 1,294,981
2024 - 2028 5,190,000 1,278,397 6,468,397
2029 - 2032 4,790,000 388,064 5,178,064
$ 14,320,000 $ 3,794,476 $ 18,114,476
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 $26,004 currently recorded in the General Fund
is adequate to cover the outstanding claims.
THE VILLAGE OF NORTH PALM BEACH, FLORIDA
Notes to the Basic Financial Statements
September 30, 2018
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, 2018, 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, 2018
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, 2017:
GERF F&P
Inactive Plan Members or Beneficiaries
currently receiving benefits 35 27
Inactive Plan Members entitled to but
not yet receiving benefits 36 12
Active Plan Members 33 53
Total 104 92
THE VILLAGE OF NORTH PALM BEACH, FLORIDA
Notes to the Basic Financial Statements
September 30, 2018
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, 2018
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, 2018, 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, 2018, the annual money-weighted rate of
return on Pension Plan investments, net of pension plan investment expense, was 8.26 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, 2018
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, 2018, 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, 2018, the annual money-weighted rate of
return on Pension Plan investments, net of pension plan investment expense, was 7.14 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, 2018
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, 2018.
All Retirement Plans
Net Pension Liability. The components of net pension liability of the Village on September 30,
2018 were as follows:
General
Employees
Fire and
Police
Total pension liability $ 17,833,215 $ 27,159,019
Plan fiduciary net position (16,399,189) (25,024,740)
Village's net pension liability $ 1,434,026 $ 2,134,279
Plan fiduciary net position as a
percentage of total pension liability 91.96% 92.14%
The pension liability of the Fire and Police plan increased by a net of $174,565 due to an
assumption change in the investment rate of return from 7.80% to 7.75%.
THE VILLAGE OF NORTH PALM BEACH, FLORIDA
Notes to the Basic Financial Statements
September 30, 2018
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, 2017 updated to September 30, 2018 using the following actuarial assumptions
applied to the September 30, 2018 measurement period.
General Employees Fire and Police
Inflation 2.75% 2.50%
Salary increases Service based Service based
Investment rate of return 6.75% 7.75%
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, 2018, 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 3.50% 2.50%
Real estate N/A 4.50%
THE VILLAGE OF NORTH PALM BEACH, FLORIDA
Notes to the Basic Financial Statements
September 30, 2018
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 7.75 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 $ 3,951,019 $ 1,434,026 $ (639,648)
Fire and Police Retirement System
Current
Discount
1% Decrease Rate 1% Increase
6.75% 7.75% 8.75%
Village's net pension liability $ 6,026,816 $ 2,134,279 $ (1,055,685)
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, 2018, are reported using a measurement date of September 30, 2017.
THE VILLAGE OF NORTH PALM BEACH, FLORIDA
Notes to the Basic Financial Statements
September 30, 2018
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, 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
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, 2017, 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% 6.50% 7.50%
International equity 15 10 6.75% 8.50%
Domestic bonds 40 30 2.25% 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, 2018
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 7.80 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.
General Employees' Retirement System
Changes in Net Pension Liability
Using a measurement date of September 30, 2017, the components of the net pension liability
reported by the Village at September 30, 2018, were as follows:
Total Fiduciary Net
Pension Net Pension
Description
Liability
(a)
Position
(b)
Liability
(a)-(b)
Balances at September 30, 2016 $ 16,487,216 $ 13,500,269 $ 2,986,947
Changes due to:
Service cost 275,504 275,504
Interest 1,116,142 1,116,142
Difference between expected
and actual experience (246,222) (246,222)
Changes of Assumptions 23,053 23,053
Employer contributions 527,617 (527,617)
Employee contributions 110,417 (110,417)
Benefit payments and refunds (454,571) (454,571)
Net investment income 1,487,313 (1,487,313)
Administrative expenses (22,361) 22,361
Total changes 713,906 1,648,415 (934,509)
Balances at September 30, 2017 $ 17,201,122 $ 15,148,684 $ 2,052,438
THE VILLAGE OF NORTH PALM BEACH, FLORIDA
Notes to the Basic Financial Statements
September 30, 2018
61
NOTE 8 – EMPLOYEE RETIREMENT PLANS (Continued)
General Employees' Retirement System (Continued)
The pension liability of the General Employees plan increased by $23,053 due a change in the
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 $ 4,561,024 $ 2,052,438 $ (9,258)
Pension expense and deferred outflows and inflows of resources
For the fiscal year ended September 30, 2018, the Village recognized pension expense of
$449,578. 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 $ 400,473 $ 713,054
Differences between expected and actual
experience 171,268
Assumption changes 277,801
Village plan contributions subsequent
to the measurement date 451,560
Total $ 1,129,834 $ 884,322
THE VILLAGE OF NORTH PALM BEACH, FLORIDA
Notes to the Basic Financial Statements
September 30, 2018
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 $451,560 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, 2018. 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
2019 $ 90,934
2020 (1,458)
2022 (181,404)
2022 (114,120)
2023
Thereafter
$ (206,048)
Fire and Police Retirement System
Sensitivity of the Net Pension Liability to Changes in the Discount Rate
Current
Discount
1% Decrease Rate 1% Increase
6.80% 7.80% 8.80%
Village's net pension liability $ 5,352,774 $ 1,790,686 $ (1,125,716)
THE VILLAGE OF NORTH PALM BEACH, FLORIDA
Notes to the Basic Financial Statements
September 30, 2018
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, 2017, the components of the net pension liability
reported by the Village at September 30, 2018, were as follows:
Total Fiduciary Net
Pension Net Pension
Description
Liability
(a)
Position
(b)
Liability
(a)-(b)
Balances at September 30, 2016 $ 22,602,715 $ 19,940,073 $ 2,662,642
Changes due to:
Service cost 851,932 851,932
Interest 1,779,947 1,779,947
Change in excess state money 83,231 83,231
Differences between expected
and actual experience (197,249) (197,249)
Change of Assumptions 198,680 198,680
Employer contributions 945,880 (945,880)
Employer contributions-state 309,138 (309,138)
Employee contributions 211,474 (211,474)
Employee contributions buy back 7,902 7,902
Benefit payments and refunds (680,673) (680,673)
Net investment income 2,198,298 (2,198,298)
Administrative expenses (76,293) 76,293
Total changes 2,043,770 2,915,726 (871,956)
Balances at September 30, 2017 $ 24,646,485 $ 22,855,799 $ 1,790,686
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, 2018
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, 2018, the Village recognized pension expense of
$1,027,126. 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 $ $ 67,948
Differences between expected and actual
experience 241,596 197,030
Change of assumptions 279,337 951,830
Village plan contributions subsequent
to the measurement date 1,131,551
Total $ 1,652,484 $ 1,216,808
The deferred outflows of resources totaling $1,131,551 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, 2018. 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
2019 $ 40,652
2020 95,472
2021 (153,878)
2022 (260,257)
2023 (139,288)
Thereafter (278,576)
$ (695,875)
THE VILLAGE OF NORTH PALM BEACH, FLORIDA
Notes to the Basic Financial Statements
September 30, 2018
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, 2018, using a measurement date of September 30, 2017, are as follows:
General
Employees
Fire and
Police Total
Total pension liability $ 17,201,122 $ 24,646,485 $ 41,847,607
Plan fiduciary net position 15,148,684 22,855,799 38,004,483
Net pension liability 2,052,438 1,790,686 3,843,124
Deferred outflows of resources 1,129,834 1,652,484 2,782,318
Deferred inflows of resources 884,322 1,216,808 2,101,130
Pension expense 449,578 1,027,126 1,476,704
Accounts Payable - - -
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, 2018, $308,600 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, 2018
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, 2018, is presented below.
STATEMENT OF FIDUCIARY NET POSITION
General
Employees’
Pension
Assets
Cash and cash equivalents $ 305,302
Investments:
Fixed income exchange traded funds 2,776,601
Equity exchange traded funds 3,378,078
Fixed income mutual funds 2,824,913
Equity mutual funds 7,098,518
Accrued dividends and interest 7,016
Accounts receivable 21,042
Total assets 16,411,470
Liabilities
Accounts payable 12,281
Net position
Held in trust for pension benefits and
other purposes
$ 16,399,189
THE VILLAGE OF NORTH PALM BEACH, FLORIDA
Notes to the Basic Financial Statements
September 30, 2018
67
NOTE 10 – PENSION PLAN FINANCIAL INFORMATION (Continued)
STATEMENT OF CHANGES IN FIDUCIARY NET POSITION
General
Employees’
Pension
Additions
Contributions
Employer $ 451,560
Plan members 101,858
Total contributions 553,418
Investment earnings
Dividends and interest 398,012
Net (decrease) in the fair value
of investments 840,786
Less investment expense (48,195)
Total investment earnings 1,190,603
Total additions 1,744,021
Deductions
Administration 21,489
Benefits 472,027
Total deductions 493,516
Change in net position 1,250,505
Net position - beginning 15,148,684
Net position - ending $ 16,399,189
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 four 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, 2018
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, 2018, is listed below:
Village
Manager
Directors
General
Employees
Municipal
Employees
Employee contributions $ 4,770 $ 56,862 $ 53,306 $ 74,351
Village pension expense 23,850 108,880 169,493 161,767
Forfeitures - 30,157 45,190
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, 2018
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
General Information about the OPEB Plan
Effective October 1, 2016, the Village implemented Governmental Accounting Standards Board
Statement 75 (GASB 75), Accounting and Financial Reporting for Postemployment Benefits
Other Than Pensions, see Note 19. Retirees of the Village pay an amount equal to the actual
premium for health insurance charged by the carrier. The premium charged includes an implied
subsidy, as the amount charged for all participants (active employee or retiree) is the same,
regardless of age. Under GASB 75, an implied subsidy is considered other post-employment
benefits (OPEB).
The following describes the Village’s OPEB Provisions:
Plan Description
The Village provides a single employer defined benefit health care plan to all of its employees
and the plan is administered by the Village. The plan has no assets and does not issue a separate
financial report.
Benefits Provided
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 or 52; ,
depending on the option selected by the employee and 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.
Employees Covered by Benefit Terms
At September 30, 2018, the following employees were covered by benefit terms:
Participants
Active employees 144
Inactive employees currently receiving benefits 4
Inactive employees entitled to but not receiving benefits -
Total 148
THE VILLAGE OF NORTH PALM BEACH, FLORIDA
Notes to the Basic Financial Statements
September 30, 2018
70
NOTE 13 – OTHER POSTEMPLOYMENT BENEFITS (Continued)
Contribution Requirements: The Village does not make direct contributions to the plan on behalf
of retirees. Retirees and their beneficiaries pay the same group health rates as active employees.
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 annual age-adjusted costs paid by the Village, or its active employees, for
coverage of the retirees and their dependents net of the retiree’s own payments for the year.
Total OPEB Liability
The Village’s total OPEB liability of $1,442,974 was measured as of September 30, 2018 and
was determined by the actuarial valuation as of that date.
Actuarial Assumptions and Methods
The total OPEB liability was determined using the following actuarial assumptions and other
methods:
Valuation Date: September 30, 2018
Discount Rate: 4.15% per annum
Source Bond Buyer GO 20-Bond Municipal Index
Salary Increase Rate: Service based between 4% to 12.5% per annum
Health Care Trend Rate: An initial rate of 9.0% decreasing by 0.5%
annually to an ultimate rate of 5.0%.
Inflation Rate: General 2.75% per annum
Fire and Police 2.5% per annum
Census Data: The census was provided by the Village as of
August 2018.
Marriage Rate/Participation: The assumed number of eligible dependents is
based on the current portions of single and family
contracts in the census provided. The spousal
participation assumed at retirement is 75%.
Actuarial Cost Method: Entry Age Normal based on level percentage of
projected salary.
Amortization Method: Experience/Assumptions gains and losses are
amortized over the closed period of 9 years
starting on October 1, 2017, equal to the average
remaining service of active and inactive plan
members (who have no future service).
THE VILLAGE OF NORTH PALM BEACH, FLORIDA
Notes to the Basic Financial Statements
September 30, 2018
71
NOTE 13 – OTHER POSTEMPLOYMENT BENEFITS (Continued)
Actuarial Assumptions and Methods (Continued)
Plan Participation Percentage: The participation percentage is the assumed rate
of future eligible retirees who elect to continue
health coverage at retirement. It is assumed that
40% of employees in the General and the Fire and
Police Pension Plans and 35% in the Defined
Contribution Plan elect coverage. This assumes
that a one-time irrevocable election to participate
is made at retirement.
Mortality Rates: General and Defined Contribution Plans: RPH-
2018 Total Dataset Mortality Table fully
generational using Scale MP-2018.
Police and Fire Plan: RPH-2018 Blue Collar
Mortality Table fully generational using Scale
MP-2018
Discount Rate
The Village does not have a dedicated Trust to pay retiree healthcare benefits. Per GASB 75, the
discount rate is a yield or index rate for 20-year, tax-exempt municipal bonds. As a result, the
calculation used a rate of 4.15%.
Changes in the Total OPEB Liability
Total OPEB
Liability
Balance at September 30, 2017, as restated $ 3,210,652
Changes for the Year:
Service Cost 274,702
Interest Cost 124,097
Changes of Assumptions and Other Inputs (677,494)
Differences Between Expected and
Actual Experience
(1,354,390)
Benefit Payments (134,593)
Net Change in Total OPEB Liability (1,767,678)
Balance at September 30, 2018 $ 1,442,974
THE VILLAGE OF NORTH PALM BEACH, FLORIDA
Notes to the Basic Financial Statements
September 30, 2018
72
NOTE 13 – OTHER POSTEMPLOYMENT BENEFITS (Continued)
Changes in Assumptions
The discount rate was 3.36% at 10/1/17 and 4.15% at 9/30/18, the actuarial cost method changed
from Projected Unit Credit to Entry Age Normal, the mortality table was updated, and the health
care trend rates were increased.
Sensitivity of the Total OPEB Liability to Changes in the Discount Rate
The following presents the total OPEB liability of the Village, as well as what the Village’s total
OPEB liability would be if it were calculated using a discount rate that is 1-percentage-point
lower (3.15%) or 1-percentage-point higher (5.15%) then the current discount rate:
1.0% Decrease Discount Rate 1.0% Increase
(3.15%) (4.15%) (5.15%)
Total OPEB Liability $ 1,574,408 $ 1,442,974 $ 1,324,036
Sensitivity of the Total OPEB Liability to Changes in the Healthcare Trend Rates
The following presents the total OPEB liability of the Village, as well as what the Village’s total
OPEB liability would be if it were calculated using healthcare cost trends that are 1-percentage-
point lower or 1-percentage-point higher (then the current healthcare cost trend rates:
Healthcare cost
1.0% Decrease Trend Rates 1.0% Increase
(8% decreasing (9% decreasing (10% decreasing
to 4%) to 5%) to 6%)
Total OPEB Liability $ 1,286,774 $ 1,442,974 $ 1,626,882
OPEB Expense and Deferred Outflows and Inflows of Resources Related to OPEB
For the year ended September 30, 2018, the Village recognized OPEB expense of $173,034. At
September 30, 2018, the Village reported deferred outflows of resources and deferred inflows of
resources related to OPEB from the following sources:
Deferred
Outflows
Deferred
Inflows
of Resources of Resources
Changes of Assumptions/Inputs $ - $ 602,217
Differences Between Expected and Actual Experience 1,203,902
Total $ - $ 1,806,119
THE VILLAGE OF NORTH PALM BEACH, FLORIDA
Notes to the Basic Financial Statements
September 30, 2018
73
NOTE 13 – OTHER POSTEMPLOYMENT BENEFITS (Continued)
OPEB Expense and Deferred Outflows and Inflows of Resources Related to OPEB (Continued)
Amounts reported as deferred outflows of resources and deferred inflows of resources will be
recognized in OPEB expense as follows:
Fiscal Year Ending:
September 30, 2019 $ (225,765)
September 30, 2020 (225,765)
September 30, 2021 (225,765)
September 30, 2022 (225,765)
September 30, 2023 (225,765)
Thereafter (677,294)
$ (1,806,119)
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 $150,265 to
Seacoast during the fiscal year for water and sewer service.
NOTE 15 –INTERFUND ACTIVITY
Due from/to other funds
The $1,100,507 due to the Capital Projects Fund from the General Fund is due to funds
transferred for capital projects that have not been fully expended and the $44,028 due from the
Recreation Special Revenue Fund (a Non-Major Fund) to the Capital Projects fund is from grant
funds that have been spent but are not yet reimbursed.
Advances to/from other funds
The $1,371,447 advanced from the General Fund to the Country Club Fund was to provide funds
for the renovation of the Golf Course. The Country Club Fund will start paying back the
advance in the fiscal year ending September 30, 2025, which is after the Bank of America loan is
paid off.
THE VILLAGE OF NORTH PALM BEACH, FLORIDA
Notes to the Basic Financial Statements
September 30, 2018
74
NOTE 15 –INTERFUND ACTIVITY (Continued)
Transfers
Interfund transfers during the year ended September 30, 2018, are as follows:
The $4,913,307 from the General Fund to the Capital Projects Fund and $50,000 from the
General Fund to the Recreation Special Revenue Fund (a Non-Major Fund) to fund capital
projects according to the original budget and subsequent budget amendments.
NOTE 16 – DEFICIT FUND BALANCE
Recreation Special Revenue Fund (a Non-Major Fund) has a deficit unassigned fund balance of
$114,279 which is due to incurring grant related expenditures before all the conditions of
reimbursement have been met. These expenditures are expected to be reimbursed in the
subsequent fiscal year.
NOTE 17 – 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, 2018 expenses under the lease were $110,682. Due to the closure of the golf
course for renovations, in May 2018 the lease was cancelled and replaced with a new three year
lease starting in December 2018, at a monthly cost of $13,391.
Contract 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, 2019 is $409,220.
THE VILLAGE OF NORTH PALM BEACH, FLORIDA
Notes to the Basic Financial Statements
September 30, 2018
75
NOTE 17 – CONTRACTS, COMMITMENTS AND CONTINGENCIES (Continued)
Contract Commitments (Continued)
Commitments outstanding at September 30, 2018 are the new country club clubhouse for
$13,523,700, the golf course renovation for $154,400, the new roof for the public safety building
for $518,000, and Anchorage park improvements for $90,393,
Subsequent to September 30, 2018, the Village approved a capital lease for 11 vehicles at a total
cost of $389,675 over five years, $176,600 for conceptual bridge and streetscape designs for
Prosperity Farms Road, US Highway One and Lighthouse Drive, $216,963 for a new sanitation
truck, $518,000 for the capital lease of a new fire truck over seven years, and $114,480 for the
Community Center Trail.
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 18 – CHANGE IN ACCOUNTING PRINCIPLES
Implementation of GASB Statements: The Village implemented the following GASB Statements
during the fiscal year ended September 30, 2018:
GASB Statement No. 89, Accounting for Interest Cost Incurred Before the End of a Construction
Period. This Statement requires that interest cost incurred before the end of a construction period
be recognized as an expense in the period in which the cost is incurred. As a result, interest cost
incurred before the end of a construction period will not be included in the historical cost of a
capital asset. Construction related interest costs of $7,783 were expensed in the current fiscal
year and there was no cumulative restatement.
GASB 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. The cumulative effect of applying this statement is
required to be reported as a restatement of beginning net position.
THE VILLAGE OF NORTH PALM BEACH, FLORIDA
Notes to the Basic Financial Statements
September 30, 2018
76
NOTE 18 – CHANGE IN ACCOUNTING PRINCIPLES (Continued)
A reconciliation of the prior period ending net position to the current period beginning net
position is as follows:
Governmental
Activities
Business-type
Activities/
Enterprise Fund
Balance at September 30, 2017, as reported $ 21,013,494 $ 2,352,629
Adjustment for adoption of GASB 75 (379,588) 23,119
Balance at September 30, 2017, as restated $ 20,633,906 $ 2,375,748
NOTE 19 – NEW ACCOUNTING STANDARDS
Below is a brief description and effective date of new accounting standards that could have a
significant impact on the Village.
• GASB Statement No. 87, Leases. This Statement will increase the usefulness of
governments’ financial statements by requiring recognition of certain lease assets and
liabilities for leases that previously were classified as operating leases and recognized as
inflows of resources or outflows of resources based on the payment provisions of the
contract. It establishes a single model for lease accounting that is based on the
foundational principle that leases are financings of the right to use an underlying asset.
This Statement is effective for the fiscal year ending September 30, 2021.
• GASB Statement No. 88, Certain Disclosures Related to Debt, Including Direct
Borrowings and Direct Placements. The primary objective of this Statement is to
improve the information that is disclosed in notes to government financial statements
related to debt, including direct borrowings and direct placements. It also clarifies which
liabilities governments should include when disclosing information related to debt. This
Statement is effective for the fiscal year ending September 30, 2019.
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
PENSION AND OTHER POSTEMPLOYMENT BENEFIT TREND INFORMATION
2018
Total OPEB liability
Service cost 274,702$
Interest cost 124,097
Difference between expected
and actual experience (1,354,390)
Changes of assuptions and other imputs (677,494)
Benefit payments (134,593)
Other changes -
Net change in total OPEB liability (1,767,678)
Total OPEB liability, beginning of year 3,210,652
Total OPEB liability, end of year 1,442,974$
Changes of Assumptions
For 2018 the discount rate was 3.36% at 10/1/17 and 4.15% at 9/30/18.
NOTE: The Village implemented GASB Statement 75 in 2018; information is presented for those
years in which information is available.
THE VILLAGE OF NORTH PALM BEACH, FLORIDA
Required Supplemental Information
September 30, 2018
Schedule of Changes in Total OPEB Liability
Last Ten Fiscal Years
77
2014 2015 2016 2017 2018
Total pension liability:
Service cost 374,926$ 317,676$ 357,344$ 275,504$ 250,072$
Interest 972,865 1,048,746 1,106,085 1,116,142 1,162,025
Differences between Expected and
Actual Experience (329,040) (129,381) (246,222) (307,977)
Assumption changes 928,295 23,053
Benefit payments, including
refunds of employee contributions (263,674) (293,890) (331,174) (454,571) (472,027)
Net change in total pension liability 1,084,117 743,492 1,931,169 713,906 632,093
Total pension liability - beginning 12,728,438 13,812,555 14,556,047 16,487,216 17,201,122
Total pension liability - ending (a)13,812,555$ 14,556,047$ 16,487,216$ 17,201,122$ 17,833,215$
Plan fiduciary net position
Contributions - employer 562,953$ 464,189$ 458,615$ 527,617$ 451,560$
Contributions - Employees 142,609 125,738 126,947 110,417 101,858
Net investment income 1,072,009 (96,116) 1,161,530 1,487,313 1,190,603
Benefit payments, including
refunds of employee contributions (263,674) (293,890) (331,174) (454,571) (472,027)
Administrative expenses (17,171) (20,655) (24,794) (22,361) (21,489)
Net change in plan fiduciary net position 1,496,726 179,266 1,391,124 1,648,415 1,250,505
Plan fiduciary net position - beginning 10,433,153 11,929,879 12,109,145 13,500,269 15,148,684
Plan fiduciary net position - ending (b)11,929,879$ 12,109,145$ 13,500,269$ 15,148,684$ 16,399,189$
Net pension liability (a) - (b)1,882,676$ 2,446,902$ 2,986,947$ 2,052,438$ 1,434,026$
Plan fiduciary net position as a percentage
of the total pension liability 86.37%83.19%81.88%88.07%91.96%
Covered payroll 2,701,771$ 2,375,585$ 2,376,069$ 2,072,121$ 1,966,566$
Net pension liability as a percentage of
covered payroll 69.68%103.00%125.71%99.05%72.92%
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, 2018
General Employees Retirement Fund
78
2014 2015 2016 2017 2018
Total pension liability:
Service cost 699,244$ 810,654$ 833,909$ 851,932$ 897,280$
Interest 1,419,425 1,555,518 1,738,069 1,779,947 1,922,314
Changes in excess state money 90,535 67,645 79,505 83,231 77,905
Changes of benefit terms 1,682
Differences between Expected and
Actual Experience 483,189 (31,422) (197,249) 187,041
Changes of assumptions 246,146 (1,223,780) 198,680 174,565
Contributions - Buy Back 65,446 7,609 7,902 4,746
Benefit payments, including
refunds of employee contributions (451,574) (611,678) (653,993) (680,673) (751,317)
Net change in total pension liability 2,003,776 2,372,456 749,897 2,043,770 2,512,534
Total pension liability - beginning 17,476,586 19,480,362 21,852,818 22,602,715 24,646,485
Total pension liability - ending (a)19,480,362$ 21,852,818$ 22,602,715$ 24,646,485$ 27,159,019$
Plan fiduciary net position
Contributions - employer 943,634$ 975,733$ 969,836$ 945,880$ 822,951$
Contributions - State 321,230 298,340 310,200 309,138 308,600
Contributions - Employees 87,010 151,450 190,989 211,474 224,469
Contributions - Buy Back 65,446 7,609 7,902 4,746
Net investment income 1,468,473 111,884 1,475,735 2,198,298 1,637,891
Benefit payments, including
refunds of employee contributions (451,574) (611,678) (653,993) (680,673) (751,317)
Administrative expenses (66,748) (76,457) (76,967) (76,293) (78,399)
Net change in plan fiduciary net position 2,302,025 914,718 2,223,409 2,915,726 2,168,941
Plan fiduciary net position - beginning 14,499,921 16,801,946 17,716,664 19,940,073 22,855,799
Plan fiduciary net position - ending (b)16,801,946$ 17,716,664$ 19,940,073$ 22,855,799$ 25,024,740$
Net pension liability (a) - (b)2,678,416$ 4,136,154$ 2,662,642$ 1,790,686$ 2,134,279$
Plan fiduciary net position as a percentage
of the total pension liability 86.25%81.07%88.22%92.73%92.14%
Covered employee payroll 4,312,746$ 4,518,020$ 4,601,075$ 4,772,092$ 5,088,564$
Net pension liability as a percentage of
covered payroll 62.10%91.55%57.87%37.52%41.94%
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.
For the 2018 fiscal year the 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, 2018
Fire and Police Retirement Fund
79
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%
2018 449,477 451,560 (2,083) 1,966,566 22.96%
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 1,175,844 1,171,787 4,057 4,772,092 24.55%
2018 1,038,576 1,053,646 (15,070) 5,088,564 20.71%
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%
2018 8.26%7.14%
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, 2018
Last Ten Fiscal Years
80
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 Entry Age Normal
Amortization Method Level Dollar, closed Level Percentage of Compensation
Remaining Amortization Period 30 years 20 years
Asset Valuation Method Five year smoothed market Five year smoothed market
Inflation 2.75%2.50%
Salary increases Service based Service based
Between 4% and 10%Between 4.5% and 10%
Cost of living adjustments 2.5% for those retired before 2.50%
2/1/82 or who contribute
an extra 2%.
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, 100%
Annuitant White Collar, Scale
BB Male: RP2000, 10%
Annuitant White Collar/90%
Annuitant Blue Collar, Scale BB
THE VILLAGE OF NORTH PALM BEACH, FLORIDA
Notes to the Schedule of Contributions
September 30, 2018
81
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, 2018
Variance with
Final Budget
Budgeted Amounts Actual Positive
Original Final Amounts (Negative)
Revenues
Taxes 18,560,841$ 18,560,841$ 19,111,506$ 550,665$
Licenses and permits 955,200 955,200 1,222,594 267,394
Intergovernmental 1,466,358 1,466,358 1,482,113 15,755
Charges for services 2,328,050 2,328,050 2,200,860 (127,190)
Fines and forfeitures 68,575 68,575 100,140 31,565
Investment 50,300 50,300 112,809 62,509
Miscellaneous 12,800 171,045 412,513 241,468
Total revenues 23,442,124 23,600,369 24,642,535 1,042,166
Expenditures
Current
General government 3,157,283 3,158,684 3,059,623 99,061
Public safety 9,206,587 9,213,820 9,360,761 (146,941)
Public works 5,228,004 5,349,022 5,313,834 35,188
Community development and planning 1,567,934 1,646,458 1,429,764 216,694
Leisure services - recreation 2,838,416 2,875,120 2,613,664 261,456
Capital outlay 510,401 457,783 52,618
Debt service
Principal payments 680,000 680,000 680,000
Interest paid on debt 613,101 613,101 613,101
Total expenditures 23,291,325 24,046,606 23,528,530 518,076
Excess of revenues over
expenditures 150,799 (446,237) 1,114,005 1,560,242
Other financing sources (uses)
Appropriated fund balance 40,000 5,409,544 (5,409,544)
Transfer out (190,799) (4,963,307) (4,963,307)
Total other financing uses (150,799) 446,237 (4,963,307) (5,409,544)
Net change in fund balances $ $ (3,849,302) (3,849,302)$
Fund Balances
Beginning of year 13,092,710
End of year 9,243,408$
82
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, 2018
83
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, 2018
Variance with
Final Budget
Original Final Positive Percent
Budget Budget Actual (Negative)Variance
Village Council
Personnel services 50,466$ 50,466$ 50,463$ 3$ 0.01
Operating expenses 83,065 83,065 73,206 9,859 11.87
Total Village Council 133,531 133,531 123,669 9,862 7.39
Village Manager
Personnel services 529,949 529,949 513,622 16,327 3.08
Operating expenses 35,000 35,000 41,873 (6,873) -19.64
Total Village Manager 564,949 564,949 555,495 9,454 1.67
Procurement and Purchasing
Personnel services 84,091 84,091 78,441 5,650
Operating expenses 10,665 10,665 1,744 8,921
Total Procurement and Purchasing 94,756 94,756 80,185 14,571
Village Finance
Personnel services 588,169 588,169 557,354 30,815 5.24
Operating expenses 59,120 59,120 85,052 (25,932) -43.86
Total Village Finance 647,289 647,289 642,406 4,883 0.75
Village Attorney
Operating expenses 160,000 160,000 185,704 (25,704) -16.07
Village Clerk
Personnel services 344,291 344,291 358,096 (13,805) -4.01
Operating expenses 37,525 37,525 36,270 1,255 3.34
Total Village Clerk 381,816 381,816 394,366 (12,550) -3.29
Information Technology
Personnel services 338,809 338,809 318,181 20,628 6.09
Operating expenses 70,325 71,726 62,049 9,677 13.49
Total Information Technology 409,134 410,535 380,230 30,305 7.38
Human Resources
Personnel services 308,734 308,734 299,025 9,709 3.14
Operating expenses 116,883 116,883 83,387 33,496 28.66
Total Human Resources 425,617 425,617 382,412 43,205 10.15
Police
Personnel services 4,648,909 4,648,909 5,037,873 (388,964) -8.37
Operating expenses 994,467 994,467 839,573 154,894 15.58
Total Police 5,643,376 5,643,376 5,877,446 (234,070) -4.15
Fire Rescue
Personnel services 3,194,184 3,194,184 3,140,454 53,730 1.68
Operating expenses 262,550 269,783 223,913 45,870 17.00
Total Fire Rescue 3,456,734 3,463,967 3,364,367 99,600 2.88
(Continued)
84
THE VILLAGE OF NORTH PALM BEACH, FLORIDA
Schedule of Departmental Expenditures - Budget and Actual
General Fund
For the Year Ended September 30, 2018
Variance with
Final Budget
Original Final Positive Percent
Budget Budget Actual (Negative)Variance
(Continued)
Public Works Administration
Personnel services 317,052$ 317,052$ 329,910$ (12,858)$ -4.06
Operating expenses 67,493 72,201 80,834 (8,633) -11.96
Total Public Works 384,545 389,253 410,744 (21,491) -5.52
Sanitation
Personnel services 1,378,335 1,378,335 1,382,646 (4,311) -0.31
Operating expenses 223,950 223,950 211,449 12,501 5.58
Total Sanitation 1,602,285 1,602,285 1,594,095 8,190 0.51
Facility Services
Personnel services 341,669 341,669 324,248 17,421 5.10
Operating expenses 424,850 503,669 539,385 (35,716) -7.09
Total Facility Services 766,519 845,338 863,633 (18,295) -2.16
Street Maintenance
Personnel services 481,605 481,605 459,613 21,992 4.57
Operating expenses 1,452,438 1,489,929 1,252,136 237,793 15.96
Total Street Maintenance 1,934,043 1,971,534 1,711,749 259,785 13.18
Vehicle Maintenance
Personnel services 267,662 267,662 268,532 (870) -0.33
Operating expenses 272,950 272,950 216,441 56,509 20.70
Total Vehicle Maintenance 540,612 540,612 484,973 55,639 10.29
Planning and Engineering
Personnel services 337,132 337,132 269,496 67,636 20.06
Operating expenses 166,650 219,602 194,799 24,803 11.29
Total Planning and Engineering 503,782 556,734 464,295 92,439 16.60
Building
Personnel services 756,593 756,593 645,618 110,975 14.67
Operating expenses 149,388 164,960 181,274 (16,314) -9.89
Total Building 905,981 921,553 826,892 94,661 10.27
Code Enforcement
Personnel services 129,060 129,060 128,769 291 0.23
Operating expenses 29,111 39,111 15,808 23,303 59.58
Total Code Enforcement 158,171 168,171 144,577 23,594 14.03
Leisure Services-Recreation
Personnel services 729,030 729,030 643,388 85,642 11.75
Operating expenses 374,098 374,098 327,637 46,461 12.42
Total Leisure Services-Recreation 1,103,128 1,103,128 971,025 132,103 11.98
(Continued)
85
THE VILLAGE OF NORTH PALM BEACH, FLORIDA
Schedule of Departmental Expenditures - Budget and Actual
General Fund
For the Year Ended September 30, 2018
Variance with
Final Budget
Original Final Positive Percent
Budget Budget Actual (Negative)Variance
(Continued)
Library
Personnel services 669,017$ 669,017$ 602,931$ 66,086$ 9.88
Operating expenses 204,620 204,620 233,054 (28,434) -13.90
Total Library 873,637 873,637 835,985 37,652 4.31
Tennis
Personnel services 420,132 420,132 416,298 3,834 0.91
Operating expenses 155,723 192,427 120,541 71,886 37.36
Total Tennis 575,855 612,559 536,839 75,720 12.36
Pool
Personnel services 70,072 70,072 82,084 (12,012) -17.14
Operating expenses 114,724 114,724 124,166 (9,442) -8.23
Total Pool 184,796 184,796 206,250 (21,454) -11.61
Special Events
Operating expenses 101,000 101,000 63,565 37,435 37.06
Total Special Events 101,000 101,000 63,565 37,435 37.06
Debt Service 1,293,101 1,293,101 1,293,101 0.00
Reserves and contingencies
Operating expenses 207,753 334,810 (127,057)
207,753 334,810 (127,057)
Non-Departmental
Operating expenses 446,668 446,668 428,104 18,564 4.16
446,668 446,668 428,104 18,564 4.16
Capital Outlay
Police 70,844 (70,844)
Planning and Engineering 1,879 1,879 100.00
Reserves and contingencies 300,769 300,769 0.00
Total Capital Outlay 302,648 371,613 (68,965) -22.79
Total expenditures 23,291,325$ 24,046,606$ 23,528,530$ 518,076$ 2.15%
86
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$ 24,707$ 308,600$ 336,813$
Total assets 1,520$ 1,986$ 24,707$ 308,600$ 336,813$
Liabilities
Accounts payable $ $ 94,958$ 308,600$ 403,558$
Due to other funds 44,028 44,028
Total liabilities 138,986 308,600 447,586
Fund balances
Assigned 1,520 1,986 3,506
Unassigned (114,279)(114,279)
Total fund balances 1,520 1,986 (114,279) (110,773)
Total liabilities and fund balances 1,520$ 1,986$ 24,707$ 308,600$ 336,813$
September 30, 2018
87
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, 2018
Special Revenue Funds
Public Northlake On-Behalf Total Nonmajor
Safety Boulevard Pension Governmental
Fund Fund Recreation Contributions Funds
Revenues
Intergovernmental 9,111$ $ $ 308,600$ 317,711$
Fines and forfeitures
Total revenues 9,111 308,600 317,711
Expenditures
Current
Public safety 308,600 308,600
Capital outlay 9,111 549,754 558,865
Total expenditures 9,111 549,754 308,600 867,465
Excess (deficiency) of revenues over
(under) expenditures (549,754) (549,754)
Other financing sources (uses)
Transfers in 50,000 50,000
Total other financing sources (uses) 50,000 50,000
Net changes in fund balances (499,754) (499,754)
Fund balances - Beginning of year 1,520 1,986 385,475 388,981
Fund balances - End of year 1,520$ 1,986$ (114,279)$ $ (110,773)$
88
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 305,302$ 466,211$ 771,513$
Investments:
Domestic common equity securities 11,860,443 11,860,443
International common equity securities 2,476,906 2,476,906
U.S. Government and agencies 2,515,737 2,515,737
Municipal bonds 282,652 282,652
Corporate bonds 2,973,597 2,973,597
Fixed income exchange traded funds 2,776,601 2,776,601
Equity exchange traded funds 3,378,078 3,378,078
Fixed income mutual funds 2,824,913 2,824,913
Equity mutual funds 7,098,518 7,098,518
Real estate investment fund 2,560,739 2,560,739
Money market mutual funds 1,560,240 1,560,240
Accrued interest and dividends 7,016 53,297 60,313
Accounts receivable 21,042 308,600 329,642
Prepaids 6,408 6,408
Total assets 16,411,470 25,064,830 41,476,300
Liabilities
Accounts payable 12,281 40,090 52,371
Total liabilities 12,281 40,090 52,371
Net Position restricted for pensions 16,399,189$ 25,024,740$ 41,423,929$
September 30, 2018
89
Fire and Total
General Police Employee
Employees Officers Retirement
Pension Pension Funds
Additions
Contributions
Employer 451,560$ 822,951$ 1,274,511$
Plan members 101,858 229,215 331,073
State on-behalf payments 308,600 308,600
Total contributions 553,418 1,360,766 1,914,184
Investment earnings
Dividends and interest 398,012 605,692 1,003,704
Net increase in fair value of investments 840,786 1,208,642 2,049,428
Total investment earnings 1,238,798 1,814,334 3,053,132
Less: investment expenses 48,195 176,443 224,638
Total investment earnings 1,190,603 1,637,891 2,828,494
Total additions 1,744,021 2,998,657 4,742,678
Deductions
Administration 21,489 78,399 99,888
Benefits 472,027 751,317 1,223,344
Total deductions 493,516 829,716 1,323,232
Change in net position 1,250,505 2,168,941 3,419,446
Net position - beginning 15,148,684 22,855,799 38,004,483
Net position - ending 16,399,189$ 25,024,740$ 41,423,929$
THE VILLAGE OF NORTH PALM BEACH, FLORIDA
Pension Trust Funds
Combining Statement of Changes in Fiduciary Net Position
For the Year Ended September 30, 2018
90
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 308,111$ 65,506$ 373,617$
Liabilities
Due to others 308,111$ 65,506$ 373,617$
September 30, 2018
91
Combining Schedule of Changes in Agency Net Position
September 30, 2017 Additions Deductions September 30, 2018
Manatee Protection Agency
Assets
Cash and cash equivalents 302,987$ 5,124$ $ 308,111$
Liabilities
Due to others 302,987$ 5,124$ $ 308,111$
Northlake Boulevard Task Force
Assets
Cash and cash equivalents 64,417$ 1,089$ $ 65,506$
Liabilities
Due to others 64,417$ 1,089$ $ 65,506$
Total All Agency Funds
Assets
Cash and cash equivalents 367,404$ 6,213$ $ 373,617$
Liabilities
Due to others 367,404$ 6,213$ $ 373,617$
THE VILLAGE OF NORTH PALM BEACH, FLORIDA
For the Year Ended September 30, 2018
92
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, 2018
Variance with
Final Budget
Original Final Positive Percent
Budget Budget Actual (Negative)Variance
Revenue
Greens fee/cart rentals/membership fees 1,742,611$ 1,742,611$ 1,743,759$ 1,148$ 0.07
Golf shop revenues 239,500 239,500 217,147 (22,353) -9.33
Driving range revenues 238,524 238,524 276,244 37,720 15.81
Interest revenues 10,000 10,000 13,874 3,874 38.74
Proceeds from sale of assets 19,449 19,449
Miscellaneous 6,000 6,000 17,488 11,488 191.47
Loan from general fund (1)1,700,000 (1,700,000) -100.00
Appropriated net position (1)425,770 425,770 (425,770) -100.00
Total revenues 2,662,405 4,362,405 2,287,961 (2,074,444)-47.55
Golf Maintenance
Operating expenses 1,149,822 1,149,822 1,159,941 (10,119) -0.88
Capital outlay 12,000 1,712,000 1,363,664 348,336 20.35
Total Golf Maintenance 1,161,822 2,861,822 2,523,605 338,217 11.82
Golf Pro Shop and Range
Personnel services 514,323 514,323 500,790 13,533 2.63
Operating expenses 421,939 421,939 310,953 110,986 26.30
Capital outlay 11,000 11,000 11,000 100.00
Total Golf Pro Shop and Range 947,262 947,262 811,743 135,519 14.31
Food and Beverage
Personnel services 4,222 (4,222)
Operating expenses 16,600 16,600 41,979 (25,379) -152.89
Total Food and Beverage 16,600 16,600 46,201 (29,601) (178.32)
Administration
Personnel services 67,438 67,438 68,004 (566) -0.84
Operating expenses 12,200 12,200 17,191 (4,991) -40.91
Total Administration 79,638 79,638 85,195 (5,557) -6.98
Clubhouse and Grounds
Operating expenses 4,886 4,886 68,349 (63,463) (1298.87)
Capital outlay
Total Clubhouse and Grounds 4,886 4,886 68,349 (63,463) (1298.87)
Insurance and General Liability
Operating expenses 44,038 44,038 42,711 1,327 3.01
Reserves
Operating 10,000 10,000 13,773 (3,773) (37.73)
Total Reserves 10,000 10,000 13,773 (3,773) (37.73)
Debt service
Debt service 398,159 398,159 405,942 (7,783) (1.95)
Total expenses on the budgetary basis 2,662,405 4,362,405 3,997,519 364,886 8.36
Revenues under expenses (1) $ $ (1,709,558)$ (1,709,558)$
Adjustments to reconcile to the GAAP Basis
Total expenses on the budgetary basis 3,997,519$
Less: capital outlay costs capitalized (1,363,664)
Less: debt service (405,942)
Add: depreciation expense 323,964
Total operating expenses 2,551,877$
(1)The revenue under expenses was less than the $425,770 budgeted along with the loan.
93
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 94
Changes in Net Position 95
Fund Balances, Governmental Funds 97
Changes in Fund Balances, Governmental Fund 98
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 100
Property Tax Rates - Direct and Overlapping Governments 101
Principal Property Taxpayers 102
Property Tax Levies and Collections 103
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 104
Direct and Overlapping Governmental Activities Debt 105
Pledged-Revenue Coverage 106
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 107
Principal Employers 108
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 109
Operating Indicators by Function/Program 110
Capital Asset Statistics by Function/Program 111
Sources: Unless otherwise noted, the information in these schedules is derived from the comprehensive annual
financial reports for the relevant year.
STATISTICAL SECTION
2009 2010 2011 2012 2013
Governmental Activities:
Net investment in capital assets 16,643,241$ 18,184,508$ 17,237,355$ 16,109,707$ 15,431,966$
Restricted 251,088 390,081 548,489 658,194 317,190
Unrestricted 11,016,626 10,568,594 11,775,621 11,846,141 11,973,715
Total governmental activities net position 27,910,955 29,143,183 29,561,465 28,614,042 27,722,871
Business-Type Activities:
Net investment in capital assets 2,364,814 2,295,125 2,200,927 2,082,668 1,998,974
Unrestricted 434,212 403,261 385,623 557,954 668,434
Total business-type activities net position 2,799,026 2,698,386 2,586,550 2,640,622 2,667,408
Primary government:
Net investment in capital assets 19,008,055 20,479,633 19,438,282 18,192,375 17,430,940
Restricted 251,088 390,081 548,489 658,194 317,190
Unrestricted 11,450,838 10,971,855 12,161,244 12,404,095 12,642,149
Total primary government net position 30,709,981$ 31,841,569$ 32,148,015$ 31,254,664$ 30,390,279$
2014 2015 (1)2016 2017 2018
Governmental Activities:
Net investment in capital assets 14,966,927$ 14,711,016$ 14,102,547$ 13,484,731$ 15,429,484$
Restricted 180,755 177,431 398,519 992,538 484,568
Unrestricted 11,314,096 6,168,366 6,677,850 6,536,225 6,658,744
Total governmental activities net position 26,461,778 21,056,813 21,178,916 21,013,494 22,572,796
Business-Type Activities:
Net investment in capital assets 1,907,746 1,833,975 1,880,421 1,991,168 1,685,268
Unrestricted 514,167 544,523 418,726 361,461 46,469
Total business-type activities net position 2,421,913 2,378,498 2,299,147 2,352,629 1,731,737
Primary government:
Net investment in capital assets 16,874,673 16,544,991 15,982,968 15,475,899 17,114,752
Restricted 180,755 177,431 398,519 992,538 484,568
Unrestricted 11,828,263 6,712,889 7,096,576 6,897,686 6,705,213
Total primary government net position 28,883,691$ 23,435,311$ 23,478,063$ 23,366,123$ 24,304,533$
(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
94
VILLAGE OF NORTH PALM BEACH
CHANGES IN NET POSITION
LAST TEN FISCAL YEARS
(ACCRUAL BASIS OF ACCOUNTING) Unaudited
Fiscal Year
2009 2010 2011 2012 2013
Expenses
Governmental activities:
General government 2,239,511$ 2,679,192$ 2,403,681$ 2,520,815$ 2,489,488$
Public safety 7,095,043 7,304,233 7,232,748 7,892,561 8,282,062
Public works 4,083,441 4,594,738 4,733,913 4,652,620 4,482,973
Community development and planning 826,149 806,536 811,177 884,773 966,245
Leisure services 3,174,623 2,830,292 2,749,065 2,873,496 2,974,290
Interest on long-term debt 26,702 4,384
Total governmental activities expenses 17,445,469 18,219,375 17,930,584 18,824,265 19,195,058
Business-type activities:
Country club 3,308,535 3,398,206 3,691,528 3,536,139 3,629,120
Total business-type activities 3,308,535 3,398,206 3,691,528 3,536,139 3,629,120
Total primary government expenses 20,754,004$ 21,617,581$ 21,622,112$ 22,360,404$ 22,824,178$
Program Revenues
Governmental activities:
Charges for services:
General government 122,569$ 126,968$ 130,886$ 135,372$ 107,976$
Public safety 378,591 465,263 420,653 440,568 522,121
Public works 394,082 411,722 400,662 386,974 403,447
Community development and planning 699,130 734,718 861,394 816,673 993,059
Leisure services 912,862 1,063,748 1,043,459 1,018,883 1,087,182
Other government
Operating grants and contributions 105,080 96,670 126,568 149,573 91,901
Capital grants and contributions 2,017,158 75,845 5,169 5,686 233,949
Total governmental activities program revenues 4,629,472 2,974,934 2,988,791 2,953,729 3,439,635
Business-type activities:
Charges for services:
Country club 3,404,859 3,227,580 3,571,199 3,582,760 3,577,446
Operating grants and contributions
Capital grants and contributions
Total business-type activities program revenues 3,404,859 3,227,580 3,571,199 3,582,760 3,577,446
Total primary government program revenues 8,034,331$ 6,202,514$ 6,559,990$ 6,536,489$ 7,017,081$
Net (Expense)/Revenue
Governmental activities (12,815,997)$ (15,244,441)$ (14,941,793)$ (15,870,536)$ (15,755,423)$
Business-type activities 96,324 (170,626) (120,329) 46,621 (51,674)
Total primary government net expense (12,719,673)$ (15,415,067)$ (15,062,122)$ (15,823,915)$ (15,807,097)$
General revenues and other changes in net position:
Governmental activities:
Taxes:
Property taxes 11,917,359$ 11,053,128$ 10,441,869$ 10,011,748$ 9,981,391$
Local option gas taxes 267,557 266,077 259,794 263,369 261,852
Local option infrastruture surtax
Utility service taxes 2,239,002 2,261,375 2,198,148 2,164,920 2,197,760
Franchise taxes 1,256,831 1,204,328 1,191,155 1,178,598 1,160,780
Sales and use taxes 1,116,107 1,114,945 1,140,744 1,138,097 1,187,221
Unrestricted grants and contributions
Investment earnings (1,346) 280,217 97,743 90,968 37,029
Miscellaneous 263,459 213,425 30,622 75,413 38,219
Contributions for Support Our Troops 6,796
Gain on disposl of equipment
Transfers
Total governmental activities 17,065,765 16,393,495 15,360,075 14,923,113 14,864,252
Business-type activities:
Investment income 7,376 14,686 8,493 7,451 8,555
Miscellaneous 55,300 69,905
Transfers
Total business-type activities 7,376 69,986 8,493 7,451 78,460
Total primary government 17,073,141$ 16,463,481$ 15,368,568$ 14,930,564$ 14,942,712$
Change in net position
Governmental activities 4,249,768$ 1,149,054$ 418,282$ (947,423)$ (891,171)$
Business-type activities 103,700 (100,640) (111,836) 54,072 26,786
Total primary government 4,353,468$ 1,048,414$ 306,446$ (893,351)$ (864,385)$
Basic Financial Statements and Management's Discussion and Analysis for State and Local Governments.
95
2014 2015 2016 2017 2018
2,696,298$ 3,028,716$ 2,985,185$ 3,205,903$ 3,213,886$
9,259,442 9,311,441 9,308,778 9,905,815 10,045,757
4,485,246 4,963,704 5,106,651 5,707,570 5,911,225
1,046,299 1,308,924 1,382,121 1,255,115 1,458,523
3,114,213 2,973,687 2,904,715 3,114,720 3,058,410
266,892 499,929
20,601,498 21,586,472 21,687,450 23,456,015 24,187,730
3,902,131 3,842,660 3,845,547 2,903,224 2,912,523
3,902,131 3,842,660 3,845,547 2,903,224 2,912,523
24,503,629$ 25,429,132$ 25,532,997$ 26,359,239$ 27,100,253$
110,694$ 131,445$ 128,459$ 134,249$ 140,998$
592,644 537,064 628,529 557,265 548,019
402,814 514,354 565,011 547,596 510,732
1,621,471 1,163,875 1,213,032 1,222,464 1,495,298
1,096,021 1,006,382 994,918 1,022,175 876,174
90,520 380,567 365,823 377,339 422,255
16,098 26,548 229,161 102,187 9,591
3,930,262 3,760,235 4,124,933 3,963,275 4,003,067
3,645,706 3,788,852 3,720,573 2,946,432 2,946,432
3,645,706 3,788,852 3,720,573 2,946,432 2,946,432
7,575,968$ 7,549,087$ 7,845,506$ 6,909,707$ 6,949,499$
(16,671,236)$ (17,826,237)$ (17,562,517)$ (19,492,740)$ (20,184,663)$
(256,425) (53,808) (124,974) 43,208 33,909
(16,927,661)$ (17,880,045)$ (17,687,491)$ (19,449,532)$ (20,150,754)$
10,154,695$ 11,364,888$ 12,253,917$ 13,091,985$ 15,003,141$
266,147 282,549 288,150 305,700 302,208
552,600 879,565
2,277,366 2,267,118 2,303,294 2,413,679 2,511,877
1,232,669 1,253,139 1,263,812 1,306,997 1,294,280
1,260,617 1,332,209 1,363,954 1,371,890 1,413,335
16,653 108,794 103,353 126,926 376,227
146,360 57,137 60,026 150,698 268,471
55,636 30,457 48,114 6,843 74,449
15,410,143 16,696,291 17,684,620 19,327,318 22,123,553
10,930 10,393 9,230 10,274 13,874
36,393
10,930 10,393 45,623 10,274 13,874
15,421,073$ 16,706,684$ 17,730,243$ 19,337,592$ 22,137,427$
(1,261,093)$ (1,129,946)$ 122,103$ (165,422)$ 1,938,890$
(245,495) (43,415) (79,351) 53,482 47,783
(1,506,588)$ (1,173,361)$ 42,752$ (111,940)$ 1,986,673$
96
THIS PAGE INTENTIONALLY LEFT BLANK
2009 2010 2011 2012 2013
Pre GASB 54
General Fund
Reserved 563,115$ $ $ $ $
Unreserved 10,058,216
Total general fund
Post GASB 54
General Fund
Nonspendable 167,108 276,924 166,839 293,674
Restricted 338,457 548,489 658,194 317,190
Committed 442,833
Assigned 104,245 186,594 127,574 200,016
Unassigned 10,443,099 10,688,660 11,244,977 11,451,668
Total general fund 10,621,331$ 11,052,909$ 11,700,667$ 12,197,584$ 12,705,381$
Pre GASB 54
All other Governmental Funds
Reserved $ $ $ $ $
Unreserved, reported in:
Special revenue funds (152,861)
Capital projects funds 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 47,652
Capital projects funds 844,742 1,491,574 2,129,831 1,799,617
Total all other governmental funds 672,917$ 892,121$ 1,538,681$ 2,177,483$ 1,847,269$
Post GASB 54 2014 2015 2016 2017 2018
General Fund
Nonspendable 244,438$ 155,594$ 358,606$ 183,220$ 1,511,733$
Restricted 135,255 131,931 353,019 781,756 47,338
Committed
Assigned 216,808 319,888 208,204 316,266 407,862
Unassigned 12,391,362 10,802,623 10,724,049 11,811,468 7,276,475
Total general fund 12,987,863$ 11,410,036$ 11,643,878$ 13,092,710$ 9,243,408$
All other Governmental Funds
Restricted 45,500$ 45,500$ 45,500$ 13,988,744$ 11,826,016$
Assigned
Special revenue funds 325,152 318,526 508,481 388,981 5,398,245
Capital projects funds 841,850 1,448,620 1,604,073 1,670,196 3,506
Unassigned (114,279)
Total all other governmental funds 1,212,502$ 1,812,646$ 2,158,054$ 16,047,921$ 17,113,488$
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
97
VILLAGE OF NORTH PALM BEACH
CHANGES IN FUND BALANCES, GOVERNMENTAL FUNDS
LAST TEN FISCAL YEARS
(MODIFIED ACCRUAL BASIS OF ACCOUNTING) Unaudited
Fiscal Year
2009 2010 2011 2012 2013
Revenues:
Taxes 15,680,749$ 14,784,906$ 14,090,966$ 13,618,635$ 13,601,783$
Licenses and Permits 880,016 910,997 959,098 810,390 803,337
Intergovernmental 3,315,908 1,768,388 1,557,377 1,591,678 1,817,603
Charges for services 1,684,718 1,944,245 1,934,424 1,966,179 2,141,437
Fines and forfeitures 145,340 142,048 164,366 140,610 131,524
Investment earnings (1,345) 280,218 97,743 90,968 37,029
Miscellaneous 300,455 278,062 59,462 130,293 207,076
Total revenues 22,005,841 20,108,864 18,863,436 18,348,753 18,739,789
Expenditures:
General government 1,970,257 2,496,342 2,402,241 2,328,568 2,346,281
Public safety 6,835,730 7,021,231 7,053,282 7,583,018 7,947,221
Public works 3,432,556 3,887,034 4,044,642 3,886,698 3,733,977
Community development and planning 784,486 774,121 790,937 844,748 933,117
Leisure services - recreation 2,898,252 2,361,388 2,295,959 2,374,748 2,491,559
Other government
Capital outlay 3,939,455 663,582 682,057 495,254 1,110,051
Debt service
Principal payments 1,395,735 2,250,000
Interest paid on debt 43,725 4,384
Total expenditures 21,300,196 19,458,082 17,269,118 17,513,034 18,562,206
Excess of revenues over (under) expenditures 705,645 650,782 1,594,318 835,719 177,583
Other financing sources (uses)
Transfers in 454,111 163,490 1,334,934 500,000 265,000
Transfers out (454,111) (163,490) (1,334,934) (500,000) (265,000)
Capital lease
Proceeds from debt issuance
Miscellaneous
Total other financing sources (uses)
Net change in fund balances 705,645$ 650,782$ 1,594,318$ 835,719$ 177,583$
Debt service as a percentage of noncapital
expenditures 8.07%11.99%---
98
2014 2015 2016 2017 2018
13,930,877$ 15,167,694$ 16,109,173$ 17,118,361$ 19,111,506$
1,344,653 947,158 1,235,782 997,656 1,222,594
1,688,608 1,758,246 1,765,836 2,417,809 2,679,389
2,320,305 2,231,673 2,364,013 2,321,298 2,200,860
117,869 128,235 91,534 124,395 100,140
16,653 108,794 103,353 126,926 376,227
258,086 122,107 191,250 157,063 412,513
19,677,051 20,463,907 21,860,941 23,263,508 26,103,229
2,541,546 2,904,553 2,876,521 2,970,223 3,059,623
8,947,627 8,966,077 9,129,947 9,166,060 9,669,361
3,773,689 4,255,636 4,266,749 4,882,159 5,313,834
1,004,642 1,270,399 1,351,061 1,190,759 1,429,764
2,644,598 2,514,495 2,448,164 2,591,866 2,613,664
1,117,234 1,530,430 1,209,249 2,123,742 5,507,617
680,000
613,101
20,029,336 21,441,590 21,281,691 22,924,809 28,886,964
(352,285) (977,683) 579,250 338,699 (2,783,735)
323,000 2,091,246 1,503,750 1,503,750 4,963,307
(323,000) (2,091,246) (1,503,750) (1,503,750) (4,963,307)
15,000,000
15,000,000
(352,285)$ (977,683)$ 579,250$ 15,338,699$ (2,783,735)$
----5.84%
99
Fiscal Year
Ended
Sept 30,
Tax Roll
Year Residential Property
Commercial
Property
Personal
Property
Total Net Market -
Assessed Value
Total Direct
Tax Rate
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
2018 2017 1,804,338,668 279,488,569 35,855,827 2,119,683,064 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
100
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
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
2018 2017 7.3300 6.7690 4.9023 1.7818 20.7831
Note:All millage rates are based on $1 for every $1,000 of assessed value.
Source:North Palm Beach: Notice of Ad Valorem Taxes and Non-Ad Valorem Assessments
(1)Overlapping rates are those of local and county governments that apply to property owners within the Village
of North Palm Beach. Not all overlapping rates apply to all Village of North Palm Beach property owners
(i.e. The rates for special districts apply only to the proportion of the government's property owners whose
property is located within the geographic boundaries of the special district.)
VILLAGE OF NORTH PALM BEACH
PROPERTY TAX RATES - DIRECT AND OVERLAPPING GOVERNMENTS
LAST TEN FISCAL YEARS
Overlapping Rates (1)
101
Percentage Percentage
of Total of Total
Village Net Village Net
Taxable Taxable Taxable Taxable
Assessed Assessed Assessed Assessed
Taxpayers Value Rank Value Value Rank Value
Olen Residential Realty 31,984,561$ 1 1.51%18,000,000$ 1 0.97%
SHM Old Port Cove LLC 30,071,012 2 1.42%
Sanctuary Bay Trust Corporation 25,213,753 3 1.19%14,000,300 3 0.76%
Florida Power & Light 21,769,966 4 1.03%
JB Shoppes LLLP 16,486,443 5 0.78%
Pearland RJR LLC 13,360,328 6 0.63%
New Country Motor Cars 14,810,680 7 0.70%
SHM North Palm Beach LLC 12,074,982 8 0.57%
Palm Beach Autoplex LLC 9,861,030 9 0.47%
Domani Devolopment, LLC 9,510,043 10 0.45% 9,213,927 6 0.50%
Crystal Tree NPB 17,030,531 2 0.92%
Greater Fla Inv Co& 12,911,802 4 0.70%
CF02 Palm Beach III LP 11,000,000 5 0.60%
Village Shoppers at US 1LLC 7,896,575 7 0.43%
Old Port Cove Holding, INC 7,706,522 8 0.42%
Riverside National Bank of FL 6,044,474 9 0.33%
701 US One Inc 5,839,803 10 0.32%
Total 185,142,798$ 8.75%109,643,934$ 5.95%
Source: Palm Beach Country Appraiser
VILLAGE OF NORTH PALM BEACH
PRINCIPAL PROPERTY TAXPAYERS
2018 & 2009 Presented
2018 2009
Note: Assessed values are established by the Palm Beach Property Appraiser's offices as of January 1, each year.
102
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
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%
2018*2017 15,537,277 14,999,572 96.54%3,390 15,002,962 96.56%
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
103
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
2009 2,250,000$ -$ 4,383,033$ 97,049$ 6,730,082$ 0.83%583.20$
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
2018 14,320,000 - 1,939,366 - 16,259,366 1.79%1,229.26
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 income and population data.
Governmental Activities
LAST TEN FISCAL YEARS
104
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 89,669$ 1.20%1,076$
Palm Beach County School Board 9,853 1.12%110
Other debt:
Palm Beach County 791,484 1.20%9,498
Palm Beach County School Board 1.12%
Subtotal, overlapping debt 10,684
Village of North Palm Beach Direct Debt 14,230
Total direct and overlapping debt 24,914$
* In thousands.
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, 2018
Unaudited
Government Unit
105
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)
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 2,932,743 657,468 398,159 1.65
2013 3,586,001 2,986,080 599,921 398,159 1.51
2014 3,656,636 3,248,284 408,352 398,159 1.03
2015 3,799,245 3,226,907 572,338 398,159 1.44
2016 3,766,196 3,333,395 432,801 398,159 1.09
2017 2,956,706 2,472,812 483,894 398,159 1.22
2018 2,268,512 2,227,913 40,599 398,159 0.10
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.
106
Per Palm Beach
Median Capita County
Calendar Personal Personal Unemployment
Year Population (1)Income (1)Income (1)Rate (2)
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
2018 (estimate)13,227 ***68,833 ****46,160 **1.79
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 2012-2018 presented
***North Palm Beach Median Personal Income for 2012 - 2018 presented
****West Palm Beach/Ft Lauderdale/Miami Mean Income data presented
Note: (1)All information available at the current time is presented.
VILLAGE OF NORTH PALM BEACH
DEMOGRAPHIC AND ECONOMIC STATISTICS
LAST TEN CALENDAR YEARS
Unaudited
107
729972 628411
Percentage Percentage
of Total of Total
Employer Employees Employment Employees Employment
Palm Beach Country School Board 21,200 2.90%21,718 3.46%
Federal Government 6,226 0.85%6,191 0.99%
Tenet Health Care Corp 5,939 0.81%4,500 0.72%
Palm Beach County Government 5,952 0.82%11,319 1.80%
NextEra Energy (Florida Power & Light) 4,404 0.60%3,632 0.58%
Hospital Corporation of America (HCA) (1)3,550 0.49%3,395 0.54%
State Government 3,003 0.41%2,198 0.35%
Boca Raton Regional Hospital (2)2,800 0.38%2,100 0.33%
Florida Alantic University 2,644 0.36%2,838 0.45%
Veterans Health Administration 2,468 0.34%2,207 0.35%
Bethesda Memorial Hospital 2,282 0.31%1,496 0.24%
Office Depot 2,055 0.28%2,100 0.33%
The Breakers Hotel 2,000 0.27%1,800 0.29%
Florida Crystals (Headquarters)2,000 0.27%1,800 0.29%
Jupiter Medical Center 1,907 0.26%1,440 0.23%
G4S Secure Solutions 1,501 0.21%- 0.00%
City of West Palm Beach 1,420 0.19%1,800 0.29%
71,351 9.75%70,534 11.24%
*** FY 2017 data is not available - FY 2007 & 2016 data presented
(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:
VILLAGE OF NORTH PALM BEACH
PRINCIPAL EMPLOYERS
2018**2008
108
2009 2010 2011 2012 2013 2014 2015 2016 2017 2018
Number of Employees:
General Government
Village Manager
Full-Time 2 2 2 2 2 2 2 2 4 4
Part-Time 0 0 0 0 0 0 0 0 1 1
Information Technology
Full-Time 2 2 2 3 3 3 3 3 3 3
Part-Time 1 1 1 0 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 1 2 2 2
Village Clerk - Full-Time 3 3 3 3 3 3 3 3 3 3
Finance
Full-time 5 5 5 5 5 5 7 7 5 6
Part-Time 1 1 1 1 1 1 0 0 1 0
Public Works
Full-time 38 37 37 37 37 37 35 34 36 37
Part-Time 0 0 0 0 0 0 0 0 0 0
Police & Fire
Full-time 67 67 67 0 0 0 0 0 0 0
Part-Time 11 12 12 0 0 0 0 0 0 0
Police
Full-time 0 0 0 43 43 43 36 36 36 38
Part-Time 0 0 0 12 13 13 13 13 13 15
Fire Rescue
Full-time 0 0 0 24 24 24 24 24 24 24
Part-Time 0 0 0 0 0 0 0 0 0 0
Community Development and Planning
Full-time 9 9 9 8 8 10 11 12 13 14
Part-Time 2 2 2 2 2 1 0 0 1 1
Leisure Services
Library
Full-time 6 6 6 6 6 6 7 7 7 7
Part-Time 10 10 10 10 10 10 9 9 9 7
Recreation
Full-time 9 7 6 6 6 6 6 6 6 6
Part-Time 42 42 43 43 43 43 43 43 43 42
Other Government - Country Club
Full-time 5 5 7 5 6 8 8 8 5 5
Part-Time 21 21 64 56 54 65 65 65 27 27
236 234 279 268 268 282 275 276 241 244
* 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
109
2009 2010 2011 2012 2013 2014 2015 2016 2017 2018
FUNCTION/PROGRAM
PUBLIC WORKS
Sanitation (Tons of Refuse Collected)10,667 10,165 9,962 10,065 10,720 10,720 11,167 12,556 12,980 12,624
No. of collection units for solid waste (residential) 7,214 7,070 7,071 7,076 7,471 7,616 7,618 7,614 7,614 7,632
Number of vehicles maintained 110 110 98 98 111 98 98 92 85 89.00
Number of repair overlays completed (miles)2.5 2.71 - - - - - - - -
POLICE
Number of arrests by police officers 448 402 260 211 216 238 293 247 233 192
Number of traffic citations issued 6,305 4,951 2,564 2,566 1,254 2,799 3,407 2,494 1,974 2,014
FIRE RESCUE
EMS average response times (minutes)5.01 5.12 5.19 5.26 5.11 5.10 5.05 5.26 5.21 5.37
Number of EMS calls 1,214 1,146 1,179 1,326 1,296 1,110 1,499 1,601 1,746 1,550
COMMUNITY DEVELOPMENT & PLANNING
Bldg Dept - Number of Permits,Subpermits and certificates 1,548 1,744 1,616 1,835 2,480 2,103 3,920 4,242 4,665 2,173
Number of code enforcement violations/cases 613 391 575 817 790 887 769 680 **516/357**726/317
Number of code violations brought to board/magistrate
(Calendar Yr End)73 38 72 100 62 28 56 42 98 246
RECREATION
Number of community events presented 28 28 38 49 37 53 57 48 40 38
Number of registrants in athletic programs 1,125 1,005 1,260 1,311 2,074 1,439 1,389 1,174 1,109 1,174
LIBRARY
Library - Number of Volumes 35,681 39,277 40,658 43,340 44,966 46,546 47,339 *57,935 41,161 43,992
OTHER GOVERNMENT
Country Club
Number of Golf Members 297 354 298 283 262 250 255 265 271 178
Number of Tennis Members 180 184 173 162 190 194 193 183 183 159
Source: Village of North Palm Beach
*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
110
2009 2010 2011 2012 2013 2014 2015 2016*2017 2018
Function/Program:
General Government
No. of General Government Buildings 23 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 32.30**32.30 32.30
Number of Street Lights (within corp surroundings)513 513 513 513 513 513 513 513 628****628****
Public Safety
Fire:
Number of Stations 1 1 1 1 1 1 1 1 1 1
Number of Firemen& Officers 0 0 0 0 0 0 0 0 0 0
Number of Firemen/Paramedics/EMTs 23 23 23 22 22 22 22 23 24 21
Number of Fire Captains 0 0 0 0 0 0 0 0 0 0
Police/EMS Protection:
Number of Stations 1 1 1 1 1 1 1 1 1 1
Number of Policemen & Officers 31 31 31 28 28 28 28 28 28 30
Number of Police Captains 0 0 0 2 2 2 2.5 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)35,681 39,277 40,658 43,340 44,966 46,546 47,339 48,913 33,502 36,009
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 1 1 1 1 1 1 1 1***1***
Snack Bar 0 1 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
111
OTHER REPORTS
112
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, 2018, 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 11, 2019.
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.
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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 over financial
reporting that might be material weaknesses or significant deficiencies. Given these limitations,
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 11, 2019
114
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, 2018, and have issued our report thereon dated
March 11, 2019.
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 Auditor General.
Other Reporting Requirements
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, At-C Section 315,
regarding compliance requirements in accordance with Chapter 10.550, Rules of the Auditor
General. Disclosures in those reports, which are dated March 11, 2019, 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
financial audit report. No findings and recommendations were made in the preceding financial
audit report.
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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 and Management
Sections 10.554(1)(i)5.a. and 10.556(7), Rules of the Auditor General, require us to apply
appropriate procedures and communicate 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 to identify 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, 2018.
Pursuant to Sections 10.554(1)(i)5.b. 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.
Special District Component Units
Section 10.554(1)(i)5.c, Rules of the Auditor General, requires, if appropriate, that we
communicate the failure of a special district that is a component unit of a county, municipality,
or special district, to provide 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.
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.
Additional Matters
Section 10.554(1)(i)3., Rules of the Auditor General, requires that us to communicate
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 warrants the attention of those charged with governance. In connection with our audit, we had
one finding.
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Finding 2018-1
The 2006 loan agreement with Bank of America requires that pledged revenues cover 100% of the
debt service due plus the expenses, other than non-cash expenses, of owning and operating the
Country Club. Due to the Golf Course and Country Club being closed for part of the year for
renovations pledged revenues were short $357,560.
Management Response
Continued work to build a new clubhouse and renovate the golf course will result in reduced
Country Club Revenues due to the closure of both facilities at different times. The golf course will
resume operations in April 2019 and the Clubhouse is anticipated to open in October 2019. All
required debt service payments have been paid on time for the loan
Single Audits
The Village expended less than $750,000 of federal awards and less than $750,000 of state
financial assistance for the fiscal year ended September 30, 2018, and was not required to have a
federal single audit or a state single audit.
Response to Management Letter
The Village of North Palm Beach, Florida’s response to the finding identified in our audit is
described above. The Village of North Palm Beach, Florida’s response was not subjected to the
auditing procedures applied in the audit of the financial statements and, accordingly, we express
no opinion on it.
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, Federal and other granting agencies, the audit committee, the Village Council,
and applicable management, and is not intended to be and should not be used by anyone other than
these specified parties.
March 11, 2019
West Palm Beach, Florida
117
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, 2018. 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, 2018.
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 11, 2019