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2012 12 04 CCt f � City Council agendas and staff reports are now available on the City's web page: wwwda-quinta.org CITY COUNCIL AGENDA CITY HALL COUNCIL CHAMBERS 78-495 Calle Tampico, La Quinta REGULAR MEETING on TUESDAY, DECEMBER 4, 2012 CLOSED SESSION 3:00 P.M., OPEN SESSION 4:00 P.M. Beginning Resolution No. 2012-065 Ordinance No. 506 CALL TO ORDER ROLL CALL: Councilmembers - Evans, Franklin, Henderson, Osborne, Mayor Adolph PUBLIC COMMENT At this time, members of the public may address the City Council on any matter not listed on the agenda. Please complete a "request to speak" form and fimft your comments to three minutes. The City Council values your comments; however in accordance with State law, no action shall be taken on any item not appearing on the agenda unless it is an emergency item authorized by GC 54954.2(b). CLOSED SESSION NOTE: Time permitting the City Council may conduct Closed Session discussions during the dinner recess. Persons identified as negotiating parties are not invited into the Closed Session meeting when acquisition of real property is considered. 1. CONFERENCE WITH LABOR NEGOTIATORS, SKI HARRISON AND TERRY DEERINGER, REGARDING NEGOTIATIONS WITH THE LA QUINTA CITY EMPLOYEES ASSOCIATION PURSUANT TO GOVERNMENT CODE SECTION 54957.6 MEET AND CONFER PROCESS 2. CONFERENCE WITH LEGAL COUNSEL — ANTICIPATED LITIGATION — PURSUANT TO GOVERNMENT CODE SECTION 54956.9 (ONE MATTER) CITY COUNCIL AGENDA 1 DECEMBER 4, 2012 :_: 001 3. CONFERENCE WITH THE CITY'S .REAL PROPERTY NEGOTIATOR, FRANK J. SPEVACEK, PURSUANT TO GOVERNMENT CODE SECTION 54956.8 CONCERNING POTENTIAL TERMS AND CONDITIONS OF ACQUISITION AND/OR DISPOSITION OF REAL PROPERTY LOCATED AT DUNE PALMS ROAD AND HIGHWAY 111 (APN: 600-020-053). PROPERTY OWNERS/ NEGOTIATORS: DIRECT POINT ADVISORS, INC., MICHAEL HASTINGS RECESS TO CLOSED SESSION RECONVENE AT 4:00 P.M. PLEDGE OF ALLEGIANCE BUSINESS SESSION 1. RESOLUTION CERTIFYING THE OFFICIAL CANVASS OF ELECTION RETURNS FOR THE GENERAL MUNICIPAL ELECTION HELD NOVEMBER 6, 2012 A. RESOLUTION ACTION B. ADMINISTER OATH OF OFFICE C. DISTRIBUTE CERTIFICATES OF ELECTION 2. SELECT A MAYOR PRO TEMPORE PUBLIC COMMENT At this time, members of the public may address the City Council on any matter not listed on the agenda. Please complete a "request to speak" form and limit your comments to three minutes. The City Council values your comments; however in accordance with State law, no action shall be taken on any item not appearing on the agenda unless it is an emergency item authorized by GC 54954.2(b). CONFIRMATION OF AGENDA PRESENTATIONS 1. LA QUINTA LIBRARY AND MUSEUM QUARTERLY REPORT FOR JULY THROUGH SEPTEMBER 2012 11 2. PROCLAMATION ON THE RETIREMENT OF FIRE CHIEF PETE BLAKEMORE WRITTEN COMMUNICATIONS — NONE CITY COUNCIL AGENDA 2 DECEMBER 4, 2012 q02 APPROVAL OF MINUTES 1. MINUTES OF NOVEMBER 20, 2012 CONSENT CALENDAR NOTE: Consent Calendar items are routine in nature and can be approved by one motion. 1. RESOLUTION ACCEPTING A DONATION FROM VINTAGE LANDSCAPE 2. EXCUSE CHAIRWOMAN BARROWS' ABSENCE FROM THE NOVEMBER 27, 2012 PLANNING COMMISSION MEETING 3. SECOND READING OF ORDINANCE NO. 505 AMENDING CERTAIN SECTIONS OF TITLE 9 (ZONING) OF THE MUNICIPAL CODE, SPECIFICALLY, SECTIONS RELATING TO: RC DISTRICT DEVELOPMENT STANDARDS; GARAGE AND CARPORT SETBACKS; TABLE 9-11; DISTINGUISHING WHEN TANDEM PARKING IS PERMITTED, AND; AMENDING THE DEVELOPMENT STANDARDS APPLICABLE TO SUCH PARKING. CASE NO: ZOA 2012-109 4. SPECIAL IRRIGATION AND DRAINAGE SYSTEM INSTALLATION AND SERVICE AGREEMENT AMONG THE CITY OF LA QUINTA, CITY OF INDIO AND THE COACHELLA VALLEY WATER DISTRICT 5. ACCEPT PROJECT 2011-12, STABILIZATION OF CITY -OWNED PROPERTIES 6. FISCAL YEAR 201 1 /2012 CITY OF LA QUINTA ART IN PUBLIC PLACES ANNUAL REPORT 7. FISCAL YEAR 2011/2012 CITY OF LA QUINTA DEVELOPMENT PROJECT FEE REPORT 8. EXCUSE INVESTMENT ADVISORY BOARD MEMBER DAVID PARK FROM THE NOVEMBER 14, 2012 INVESTMENT ADVISORY BOARD MEETING 9. DEMAND REGISTER DATED DECEMBER 4, 2012 BUSINESS SESSION 3. COMPREHENSIVE ANNUAL FINANCIAL REPORT FOR THE YEAR ENDED JUNE 30, 2012 4. EXTEND THE EXISTING GOLF COURSE MANAGEMENT AGREEMENT WITH LANDMARK GOLF MANAGEMENT, LLC CITY COUNCIL AGENDA 3 DECEMBER 4, 2012 003 5. AUTHORIZE THE CITY MANAGER AND CITY ATTORNEY TO TAKE ALL STEPS NECESSARY TO ENFORCE THE CITY'S RIGHTS UNDER THE BONDS, INCLUDING THE INITIATION OF LITIGATION AGAINST ARCH INSURANCE COMPANY AND PH RANCH, LLC AS NECESSARY TO COMPLETE IMPROVEMENTS FOR TRACT MAP 31348, ESTATES AT POINT HAPPY STUDY SESSION 1. PUBLIC, EDUCATIONAL AND GOVERNMENT CABLE FRANCHISE FEE OF 1% REPORTS AND INFORMATIONAL ITEMS 1. ANIMAL CAMPUS COMMISSION (FRANKLIN) 2. CITY COUNCIL AD HOC COMMITTEE REPORTS 3. CVAG COMMITTEE REPORTS 4. CHAMBER OF COMMERCE INFO EXCHANGE COMMITTEE (OSBORNE) 5. C.V. CONSERVATION COMMISSION (EVANS) 6. C.V. MOSQUITO AND VECTOR CONTROL DISTRICT (Cox) 7. C.V. MOUNTAINS CONSERVANCY (FRANKLIN) 8. C.V.W.D. JOINT WATER POLICY COMMITTEE (ADOLPH) 9. IID ENERGY CONSUMERS' ADVISORY COMMITTEE (OSBORNE & BLUM) 10. JACQUELINE COCHRAN REGIONAL AIRPORT AUTHORITY (FRANKLIN) 11. LEAGUE OF CALIFORNIA CITIES (HENDERSON) 12. GREATER PALM SPRINGS CONVENTION & VISITORS BUREAU (EVANS) 13. PALM SPRINGS INTERNATIONAL AIRPORT COMMISSION (ROBERT TEAL) 14. RIVERSIDE COUNTY FREE LIBRARY ADVISORY COMMITTEE (GUNN) 15. RIVERSIDE COUNTY TRANSPORTATION COMMISSION (HENDERSON) 16. SUNLINE TRANSIT AGENCY/SUNLINE SERVICES GROUP (ADOLPH) 17. COMMUNITY SERVICES COMMISSION MINUTES DATED SEPTEMBER 10, 2012 DEPARTMENT REPORTS 1. CITY MANAGER A. UPDATE - SERVICE DELIVERY OPTIONS REVIEW B. RESPONSE TO PUBLIC COMMENT MAYOR'S AND COUNCIL MEMBER'S ITEMS - NONE PUBLIC HEARINGS - NONE NO PUBLIC HEARINGS ARE SCHEDULED, THEREFORE, THE CITY COUNCIL WILL ADJOURN AND NOT RECONVENE AT 7:00 PM UNLESS THERE ARE CITY COUNCIL AGENDA 4 DECEMBER 4, 2012 IN ITEMS FROM THE AFTERNOON SESSION THAT HAVE NOT BEEN CONSIDERED. ADJOURNMENT The next regular meeting of the City Council will be held on December 18, 2012, commencing with closed session at 3:00 p.m. and open session at 4:00 p.m. at the City Hall Council Chambers, 78-495 Calle Tampico, La Quinta, CA 92253. DECLARATION OF POSTING I, Susan Maysels, City Clerk, of the City of La Quinta, do hereby declare that the foregoing Agenda for the La Quinta City Council meeting was posted on the bulletin board at City Hall at 78-495 Calle Tampico and also at the bulletin boards at the Stater Brothers Supermarket at 78-630 Highway 1 1 1, and the La Quinta Cove Post Office at 51-321 Avenida Bermudas, on November 30, 2012. DATED: November 29, 2012 SUSAN MAYSELS, City Clerk City of La Quinta, California Public Notices The La Quinta City Council Chamber is handicapped accessible. If special equipment is needed for the hearing impaired, please call the City Clerk's office at 777-7123, twenty- four (24) hours in advance of the meeting and accommodations will be made. If special electronic equipment is needed to make presentations to the City Council, arrangements should be made in advance by contacting the City Clerk's office at 777- 7123. A one (1) week notice is required. If background material is to be presented to the Planning Commission during a City Council meeting, please be advised that eight (8) copies of all documents, exhibits, etc., must be supplied to the City Clerk for distribution. It is requested that this take place prior to the beginning of the meeting. Any writings or documents provided to a majority of the City Council regarding any item(s) on this agenda will be made available for public inspection at the Planning Department's counter at City Hall located at 78-495 Calle Tampico, La Quinta, California, 92253, during normal business hours. CITY COUNCIL AGENDA 5 DECEMBER 4, 2012 O O s PRESENTATION: 1 La Quinta Public Library Quarterly Report July 2012-September 2012 Circulation The La Quinta Public Library circulated 64,734 items in the First Quarter of 2012/2013. This figure is lower than expected due to the loss of some circulation numbers during the change in the automation system. Average hourly circulation during this quarter was 91.7 items per hour open. Comparisons 2007 2008 2009 2010 2011 2012 July 10,599 21,560 22,161 23,328 23,631 20,248 August 10,323 17,900 20,298 21,417 21,612 23,223 September 9,096 16,741 20,272 20,565 22,473 21.850 Door Count This quarter 58,354 people visited the Library to check out materials, read newspapers and magazines, utilize the Internet service, attend programs, do homework, and purchase books from the Friends of the Library Book Store. Comparisons 2008 2009 2010 2011 2012 July 12,268 15,260 19,511 16,636 19,740 August 11,772 15,077 18,368 17,742 19,396 September 13,783 16,967 19,844 18.788 19,218 New Borrowers In the period between July 1 and September 30, staff issued 716 new library cards. The Library had 65,768 registered borrowers as of September 30, 2012. Public Computer Usage During this quarter, 9,743 computer sessions were logged on the Library's 28 public access computers. In addition to people using public computers, many people enjoy the free Wi-Fi service with their personal laptops. Weekly Programming A Preschool Storytime for children three and a half to five years old was held six Tuesday mornings during the quarter. A total of 193 children attended. A weekly On -the -Lap Storytime for parents with babies and toddlers was held prior to the Preschool Storytime. Six programs were attended by 311 participants. Thursday @ Three is a weekly series of free programs featuring professional performers and is sponsored by the Friends of the Library. Eight -hundred eighty- four people enjoyed our four July programs. 11• English as a Second Language classes began in July and ran through September 10, 2012. Ninety-three people attended six sessions. Monthly Programs Family movies are shown on the second Sunday of each month. During the first quarter of 2012/2013 one -hundred six people attended the three movie days. Special Programs On August 3, 2012, the Library held a Stuffed Animal Sleepover. The event began when children brought their stuffed animals to a special program. Following the program the animals stayed behind for a "sleepover." As soon as the library closed, our Library's teen volunteers photographed the animals doing traditional sleepover activities. The pictures were posted for the children to see when they came to pick up their animals the next morning. Volunteers During this quarter 43 volunteers donated 598 hours of time. Volunteers worked in the book store, shelved returned books, helped with programs, and performed a myriad of other tasks. Friends of the Library The La Quinta Friends of the Library continue to offer support in all areas. Library staff was very grateful to the Friends for supporting our Family Movie Days, Reading Rewards, and Thursday @ Three programs. Their support allowed us to bring in quality performers, offer incentives and greatly contributed to the success of these programs. Networking with Other City Agencies The Library provided monthly preschool story time at the Museum during August and September. Each program contains a variety of books, songs, stretches, and a make -it and take -it activity. Three sessions of the Library's Beginner's Beginning Computer Classes were offered in September. These classes help prepare students with no computer experience for the classes being offered at the Senior Center. 007 La Quinta Library Expenditures July 1, 2012 — September 30, 2012 Library Contract Expenditures (LSS1) 7/1/12 to 9/30/12 10/1/12 to 12/31/12 1/1/13 to 3/31/13 4/1/13 to 6/30/13 Total Labor & Benefits $101,966.76 $101,966.76 Materials, Net of Donations 0 0 La Quinta Collection/Books 0 0 Automation & Courier $17,925.91 $17,925.91 Other Direct Costs $1,819.22 $1,819.22 Zone Administration $7,611.06 $7,611.06 Shared Costs $10,607.58 $10,607.58 Library Contract Expenditures $139,930.53 $139,930.53 County Expenditures 7/1/12 to 9/30/12 10/1/12 to 12/31/12 1/1/13 to 3/31/13 4/1/13 to 6/30/13 Total Personnel $6,697.70 $6,697.70 Insurance $10,128.02 $10,128.02 Miscellaneous Expenses $108.24 $108.24 Miscellaneous Maintenance Charges 0 0 Special Program Expenses -.07 -0.07 Accounting Costs $83.29 $83.29 Travel and Conferences 34.73 34.73 Support Services $10,726.02 $10,726.02 County Expenditures $27,777.93 $27,777.93 OTAL EXPENDITURES $167,708.46 $167,708.46 Ili La Quinta Museum Quarterly Report July 2012—September 2012 Visitors 861 people visited the Museum this quarter - 697 adults and 164 children. Exhibits The exhibits continuing on display in the second floor galleries until early September were California Pioneers with an emphasis on the Civil War and Ladies of Lincoln's Era. Panels with text descriptions of 13 women and their photos were rented for a four -month run. Artifacts including civil war era fashion, medical instruments, quilts, ladies' magazines and more were borrowed from other Southern California museums. In September, the exhibit of 34 local artists titled Creativity in La Quinta Cove opened with a crowded and very warm reception for 250 people. Interest has been sustained because of the local nature of the work. The first floor gallery remained dedicated to local history including Cahuilla Indian and native animal dioramas and displays on the early resorts. Programming Preschool Story Time for children ages three to five, held the first Wednesdays of August and September (none in July because the 4`" of July holiday fell on the first Wednesday), was attended by 43 children and their caretakers. These story times and craft programs are collaboration between the La Quinta Museum and the La Quinta Library. The Museum hosted two field trips for adults this quarter. The Pioneer Wednesday's summer camp for children ages nine to eleven was held in July with a total attendance of 39. It ran for three successive Wednesdays and focused on a historical timeline of La Quinta from the Cahuilla Indians to the de Anza Expedition to the Bradshaw Stagecoach Trail. Gift Shop Total gift shop sales this quarter were $725.59 ' 009 La Quinta Museum Expenditures July 1, 2012 - September 30, 2012 Museum Personnel 7/1/12 to 10/1/12 to 1/1/13 to 4/1/13 to Costs 9/30/12 12/31/12 3/31/13 6/30/13 Total Salaries $29,625.00 $29,625.00 Total Personnel Costs $29,625.00 $29,625.00 Museum Programming Costs 7/1112 to 9/30/12 10/1/12 to 12/31/12 1/1/13 to 3/31/13 4/1/13 to 6/30/13 Total Special Speaker $1,521.90 $1,521.90 Printing $108.16 $108.16 Total Programming Costs $1,630.061 $1,630.06 Other Costs 7/1/12 to 9/30/12 10/1/12 to 12/31/12 1/1/13 to 3/31/13 4/1/13 to 6/30/13 Total Travel $18.36 $18.36 Supplies $1,340.69 $1,340.69 Miscellaneous $1,626.35 $1,626.35 otal Other Costs $2,985.40 $2,985.40 OTAL EXPENDITURES $34,240.46 $34,240.46 010 IT SA/HA/FA MEETING DATE: December.4, 2012 ITEM TITLE: Resolution Accepting a Donation from Vintage Landscape RECOMMENDATIONS: AGENDA CATEGORY: BUSINESS SESSION: _ CONSENT CALENDAR: STUDY SESSION: PUBLIC HEARING: Adopt a Resolution accepting a donation from Vintage Landscape to pay for and install a seating area, flagstone walkway, and landscape improvements around the 9/1 1 Memorial at the Civic Center Campus. FISCAL IMPLICATIONS: Vintage is donating $6,540 in labor and materials for a new seating area, walkway, and landscape improvements for viewing of the new 9/1 1 Memorial (Attachment 1). CHARTER CITY IMPLICATIONS: None. BACKGROUND AND OVERVIEW: On February 21, 2012, City Council approved the design, location, and appropriation of $34,750 from Art in Public Places, for a 9/1 1 Memorial at the Civic Center Campus. Boettcher Concrete substantially completed the project in November 2012. Vintage Landscape (Parks Landscape Contactor) has volunteered to donate the materials and labor to install a viewing area in front of the Memorial (Attachment 2). The viewing area will be made from concrete and slate stone with a bench to match the rest of the Civic Center Campus seating areas. Vintage has also volunteered to donate additional plants around the Memorial to improve the landscape. The value of the donation from Vintage is$6,540. oil FINDINGS AND ALTERNATIVES: The only alternative available to the recommended action is to not accept the donation from Vintage Landscape and provide staff with alternative direction. Respectfully submitted, A'Z6 Edie Hylton Community Services Director Attachments: 1. Plan Detail 2. Donation Letter 1 012 RESOLUTION NO. 2012- A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF LA QUINTA, CALIFORNIA, ACCEPTING A DONATION FROM VINTAGE LANDSCAPE WHEREAS, on November 21, 2012, Vintage Landscape offered a donation to pay for an additional seating area and landscape improvements at the Civic Center Campus; and WHEREAS, the donation was offered to the City of La Quinta and was not given to or limited to the use of any particular employee or official; and WHEREAS, it is in the best interest of the City of La Quinta to accept the donation; NOW, THEREFORE, BE IT RESOLVED by the City Council of the City of La Quinta, California, as follows: The City of La Quinta hereby accepts the donation of approximately $6,540 in labor and materials for a seating area and landscape improvements at the Civic Center Campus. PASSED, APPROVED, and ADOPTED at a regular meeting of the La Quinta City Council held on this 41h day of December, 2012, by the following vote: AYES: NOES: ABSENT: ABSTAIN: DON ADOLPH, Mayor City of La Quinta, California Resolution No. 2012- Vintage Donation Adopted: December 4, 2012 Page 2 ATTEST: SUSAN MAYSELS, Interim City Clerk City of La Quinta, California (SEAL) APPROVED AS TO FORM: M. KATHERINE JENSON, City Attorney City of La Quinta, California 014 •- • y + � I � L� � , _. 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ATTACHMENT 2 VINTAGE LANDSCAPE November 21, 2012 Steve Howlett City of La Quinta 78-495 Calle Tampico La Quinta CA 92247-1504 RE: 9/11 Memorial at Civic Center Park Dear Steve, As you know, the City has authorized a new 9/11 memorial to be constructed at the Civic Center Park. Vintage Associates wishes to be involved in this worthy cause and donate certain site improvements to enhance the project. These improvements are outlined on plans provided to the City by Vintage Landscape. The donation consists of labor and materials to construct a concrete pad with flagstone for a bench provided by the City, plant materials added to adjacent existing planter beds, a boulder which will hold a plaque and new irrigation adjustments required for the project. Value of the Donation: install 8x20 Crescent shaded concrete pad with flagstone inspect to match existing. le and sod adjacent lawn as needed. stone around the new monument pedestal out to the band - -- _..,..... _..._ ------- _--- ._ Install a 24" Chamerops Humilis Palm with annuals at the triangle sidewalk planter west of the memorial. Adjust irrigation as needed Install monument boulder and annual color around the base at memorial. Install 6-5 bush bougainvillea to Install 1 24" box Chamerops Humilis Palm and 6 Asparagus Meyer in the oval planter east of the memorial. Ad Total Estimated Cost of Donation: as needed $2,860 Vintage Associates is proud to be associated with this project. My partners and I also applaud the City of La Quinta for offering this prime location in the Civic Center Park for this important piece of art. If any other issues arise during this project, please feel free to contact us. We look forward to the successful completion of the memorial. Sincerely, i 1 Greg Gritters '8-755 Darby Road • Bermuda Dunes, CA 92203 • (760) 772-3673 • Fat (760) 772-3624 • Lic. # 647984 018 r FA MEETING DATE: December 4, 2012 AGENDA CATEGORY: ITEM TITLE: Excuse Absence from the Commission Meeting BUSINESS SESSION: Chairwoman Katie Barrow's CONSENT CALENDAR: 2- November 27 2012, Planning STUDY SESSION: PUBLIC HEARING: RECOMMENDED ACTION: Approve a request from Chairwoman Katie Barrows to be excused from the November 27, 2012, Planning Commission meeting. BACKGROUND/ANALYSIS: Chairwoman Barrows requested to be excused from the November 27, 2012, Planning Commission meeting (Attachment 1). La Quinta Municipal Code Section 2.06.020(B) allows a member to be absent from two consecutive regular meetings or three scheduled meetings within a fiscal year without causing his/her office to become vacant. A request may be made for Council to excuse an absence after - the -fact, for extenuating circumstances, and the absence would then not be counted towards the limitation on absences. Chairwoman Barrows has had no other absences during this fiscal year and staff recommends her absence be excused by Council. ALTERNATIVES: Deny Chairwoman Barrow's request to be excused. Denial of the request would result in the absence being counted towards her limitation on absences as noted above. dig submitted, Planning Director Attachment: 1. Request from Chairwoman Barrows 020 ATTACHMENT 1 a ---Original Message -- From: Katie Barrows (mailto•kbarrowsc✓ewaa oral Sent: Tuesday, November 27, 2012 8:09 AM To: Carolyn Walker Subject: Attendance at Planning Commission meeting Carolyn, As I previously notified you, I will not be able to attend the Planning Commission meeting tonight, Tuesday, November 27, 2012, due to scheduling conflicts this week. Would you please submit the appropriate request to the City Council so that I may be excused. Please let me know if you need any other information from me.. thank you kindly, q Katie 1 021 IT / SA / HA / FA MEETING DATE: December 4, 2012 ITEM TITLE: Second Reading of Ordinance No. 505 Amending Certain Sections of Title 9 (Zoning) of the Municipal Code, Specifically, Sections Relating to: RC District Development Standards; Garage and Carport Setbacks; Table 9-11; Distinguishing When Tandem Parking Is Permitted, and; Amending the Development Standards Applicable to Such Parking. Case No: ZOA 2012-109 RECOMMENDED ACTION: Adopt Ordinance No. 505 on second reading. EXECUTIVE SUMMARY: AGENDA CATEGORY: BUSINESS SESSION: 2 CONSENT CALENDAR: 3 ki til1111W *311410 PUBLIC HEARING: The proposed Zoning Ordinance amendments are intended to clarify when and where tandem parking is allowed. Exhibit A of the recommended Ordinance represents changes to the Municipal Code relevant to tandem parking allowances. These amendments namely consist of: • Incorporation of a tandem parking definition; • Allowance for tandem garage parking designs to satisfy minimum parking requirements for the Cove, and as excess parking in all zoning districts; and, • Clarification of residential garage dimensions for tandem parking design. FISCAL IMPACT: None BACKGROUND/ANALYSIS: On November 20, 2012, the City Council moved to take up Ordinance No. 505 on first reading. The City Council further moved to introduce Ordinance No. 505 on first reading. Both motions were unanimously approved. 022 COMMISSIONS/BOARD/COMMITTEE RECOMMENDATIONS: At their regular meeting of October 23, 2012, the La Quinta Planning Commission did, on a 4-0 vote (Commissioner Wright absent), adopt Planning Commission Resolution 2012-028, recommending to the City Council adoption of the proposed amendments. There was no testimony during the public hearing, and the Commission had no substantive comments and made no revisions to the amendment language. ENVIRONMENTAL REVIEW: The La Quinta Planning Department has determined that the proposed Amendment is exempt from review under the California Environmental Quality Act pursuant to Chapter 2.6, Section 21080 of the Public Resources Code, California Environmental Quality Act Statutes, and Section 15061(B)(3), Review for Exemptions of the CEQA Guidelines. ALTERNATIVES: Alternative actions available to the City Council include denying the amendment request, referring the proposed amendment back to the Planning Commission for further consideration, or discussion and incorporation of any adjustments deemed appropriate in order to approve the proposed amendment request. Respectfully submitted, Susan Maysels City Clerk 023 CITY SA / HA / FA MEETING DATE: December 4, 2012 ITEM TITLE: Special Irrigation System Agreement Among the City of La Quinta, City of Indio and the Coachella Valley Water District RECOMMENDED ACTION: AGENDA CATEGORY: BUSINESS SESSION: CONSENT CALENDAR: 4 STUDY SESSION: PUBLIC HEARING: Approve the Special Irrigation System Agreement Among the City of La Quinta, City of Indio and the Coachella Valley Water District, subject to minor modifications approved by the City Manager and the City Attorney. EXECUTIVE SUMMARY: • The Cities of La Quinta and Indio have partnered to widen and reconstruct Madison Street between Avenue 50 and Avenue 52. The City of Indio is serving as the lead agency for these improvements. • The first phase of this improvement directly impacts three United States Bureau of Reclamation (USBR) irrigation laterals within the existing Madison Street right-of-way. • The USBR irrigation laterals are managed and maintained by Coachella Valley Water District (CVWD). • The attached Special Irrigation Installation Agreement sets forth the agreed upon standards and conditions for the reconstruction of these facilities. FISCAL IMPACT: All of the costs associated with the reconstruction of the USBR irrigation laterals outlined within the Special Irrigation System Installation Agreement are included within the project budget previously approved by the City Council. 024 BACKGROUND/ANALYSIS: The proposed improvements will widen and reconstruct Madison Street from two to four lanes between Avenue 50 and Avenue 52 to include widening the bridge on Avenue 50 just west of Madison Street. This section of Madison Street is within the cities of Indio and La Quinta. The City of La Quinta has jurisdiction over the west side of Madison Street and the City of Indio has jurisdiction over the east side of Madison Street. This project will be built in phases with the first phase being the reconstruction and widening of the existing pavement on Madison Street between Avenue 50 and Avenue 52 to include one travel lane in each direction and a two-way center turn lane. The first phase of this improvement directly impacts three USBR irrigation laterals which are managed by CVWD. The Phase 1 improvement is scheduled to be completed in March 2013. Attached is the Special Irrigation System Installation Agreement (Attachment 1) by and between CVWD, the City of La Quinta, and the City of Indio. Among other things, the agreement outlines the agreed upon standards and conditions for the reconstruction of the three USBR irrigation laterals impacted by the Phase 1 Madison Street Improvements. USBR work for Phases 2 and 3 will be considered under separate agreement(s). ALTERNATIVES: Because Madison Street cannot be widened without relocating these USBR irrigation lines staff does not recommend any alternatives to the recommended action. Respectfully submitted, s� imothy nas o , P.E. Public Works Director/City Engineer Attachment: 1. Special Irrigation System Installation Agreement Q25 ATTACHMENT No Recording Fees Required Per Government Code Section 27383 RECORDING REQUESTED BY AND WHEN RECORDED MAIL TO: COACHELLA VALLEY WATER DISTRICT Post Office Box 1058 Coachella, California 92236 R above this line is for Recorder's Use) SPECIAL IRRIGATION SYSTEM INSTALLATION AGREEMENT THIS SPECIAL IRRIGATION SYSTEM INSTALLATION AGREEMENT ("Agreement") is made on this day of 2012 ("Effective Date") by and between the COACHELLA VALLEY WATER DISTRICT, a public agency of the State of California ("District") and City of Indio a California municipal corporation and City of La Quinta, a California municipal corporation (collectively, "Cities"). RECITALS A. Cities are the owners of Madison Street, Avenue 50, and Avenue 52 roadway rights -of -way located in the Cities and legally described on Exhibit "A" and depicted on Exhibit "B" attached hereto and by this reference incorporated herein ("City Right -of -Way"). B. Cities are proposing street improvements on Madison Street from approximately 600' north of Avenue 50 to Avenue 52, on Avenue 50 from 600' west to 550' east of Madison Street, on Avenue 52 550' west to 600' east of Madison Street. Specifically, Cities desire to remove the existing 26' wide roadway structural section and widen the roadway to 40' wide from Avenue 50 to Avenue 52. These street improvements require replacement of three USBR irrigation laterals (Lat. 118.9, Lat. 119.2, and Lat 119.2A/119.6) within the existing Madison Street right-of-way as is further described herein. In addition to the foregoing, Cities shall provide such protection, in place, to USBR irrigation laterals Nos. 118.7, 118.7A and 118.0- 08Lt-05 as shall be mandated by the District. The replacement of the USBR irrigation laterals as well as the protection of such other irrigation laterals comprise the proposed work that is the subject of this Agreement and is referred to as the "Project." C. Located within the City Right -of -Way is an irrigation system comprised of the Coachella Branch of the All -American Canal ("Coachella Canal"), Flood Protection Dikes & Channels ("Protective Works") and irrigation distribution piping system ("Irrigation Distribution System") (collectively "Irrigation System") which supply Colorado River water to irrigation 12183,0001/1507323.3 11.21.12 (demi) 026 customers of District. The United States Bureau of Reclamation ("USSR") owns the Coachella Canal, Protective Works, and Irrigation Distribution System and pursuant to an agreement, the District operates and maintains the Coachella Canal, Protective Works and Irrigation Distribution System. D. The Project proposed by the Cities impacts portions of the Irrigation System that lie within or adjacent to the City Right -of -Way. In order to construct the Project, the District requires that the parties enter into this Agreement. NOW THEREFORE, THE PARTIES AGREE AS FOLLOWS: 1. Cities General Responsibilities A. Cities shall, at Cities' sole cost and expense, be responsible for compliance with the California Environmental Quality Act ("CEQA') and all other applicable state and federal environmental laws and all requirements of the Federal Endangered Species Act and the California Endangered Species Act arising out of or in connection with the Project to be constructed hereunder and for compliance with all conditions and mitigation measures which must be satisfied in connection with the same. Cities shall cause one of the parties (Indio or La Quinta) to act as lead agency for the purpose of complying with CEQA, or District may elect, but shall have no obligation, to act as lead agency. As part of its obligation to fund the CEQA process, Cities shall prepare or cause to be prepared all instruments, documents, reports and other like or kind writings required to be prepared and/or filed under CEQA. B. If applicable to the Project, Cities shall, upon request by District, and at no cost to District, furnish District with such information as Cities possess or have available to them from any consultants, engineers, contractors or other persons engaged by or under the control of Cities relating to the environmental assessment relative to the removal of the applicable portions of the Irrigation System and installation of the Project. Nothing herein contained shall be construed or interpreted to require District to make or participate in any legal action for the purpose of securing approval for any improvement. C. Cities shall employ, at Cities' sole cost and expense, a qualified professional engineering firm ("Cities' Engineer") to plan, design and prepare detailed construction plans and specifications ("Plans") for the Project in accordance with District's design criteria and standards, including, but not limited to, the District's "Development Design Manual." The Plans prepared by Cities' Engineer shall be submitted to the District and subject to District review and written approval prior to presentation thereof to contractors for bidding purposes. District shall approve or disapprove the Plans within a reasonable amount of time after submittal to District. In the event District disapproves the Plans, Cities shall modify the Plans in accordance with the reasons given for disapproval and shall resubmit the revised Plans to District for approval or disapproval. The foregoing procedure shall continue until the Plans have been approved by the District. Cities hereby acknowledge and understand that District has the sole and absolute discretion to approve or disapprove Cities' Plans. Cities represent that it will or will cause the Cities' Engineer to ensure the Plans conform to all applicable federal, state and local governmental rules, ordinances and regulations. To Cities' knowledge, after due inquiry, the 2 12183.0001 / 15 07323.3 4. 027 Plans are complete, accurate, workable and are in compliance with all governmental requirements with respect thereto. D. Cities shall within thirty (30) days of District's approval of the Plans, submit an application to the USBR to: (i) abandon the applicable portions of the Irrigation System; and (ii) relocate or construct and install the replacement portions of the Irrigation System. The term "relocate" shall mean the removal of the applicable portions of the Irrigation System and the construction of new portions of the same within new easements of fee owned land. The submittal of the application to the USBR by Cities and the process by which Cities satisfy any requirements of the USBR will be coordinated through the District. Cities hereby agree to satisfy the requirements of the USBR, at Cities' sole cost and expense. In the event a requirement of the USBR conflicts with the terms of this Agreement with respect to the abandonment or construction at the applicable portion of the Irrigation System, the requirements of the USBR shall prevail. Notwithstanding anything contained in this Agreement, Cities shall first complete the construction of the replacement portion of the Irrigation System prior to removing or causing the abandonment of the applicable portion of the Irrigation System. Nothing herein shall relieve Cities from complying with any requirements of the USBR or District for receipt of encroachment permits to remove or cause the abandonment of the applicable portion of the Irrigation System. 2. Cities' Responsibilities A. The District hereby permits the Cities to construct the Project, as is further described in Exhibit "C" attached hereto and by this reference incorporated herein, pursuant to the terms set forth in this Agreement. B. The Cities' Project includes replacement of certain USBR irrigation laterals as follows: Phase 1: Replace three USBR irrigation laterals (Lat. 118.9, Lat. 119.2, and Lat. 119.2A/119.6) within the existing Madison Street rights -of -way at such locations as depicted in the Plans approved by the District ("New Lateral Sites"), and to protect, in place, USBR irrigation laterals Nos. 118.7, 118.7A and 118.0-08 Lt-05, as shall be mandated by the District. If it is necessary due to the construction of the New Lateral Sites, the Cities, at Cities' sole cost and expense, shall provide separate utility relocation plans ("Utility Relocation Plans") for the New Lateral Sites. The Utility Relocation Plans shall be subject to review and approval by the District in the same manner as set forth in Section 1(B) of this Agreement. After the Utility Relocation Plans have been approved by District, Cities shall prepare the New Lateral Sites in strict compliance with the approved Utility Relocation Plans. The provisions herein relating to construction and installation of the Project shall apply to the work to be completed with respect to the New Lateral Sites. C. Cities shall do the following for the design.and construction of the facilities described herein only if such work (as set forth below) is applicable to and is required due to the impact of the Project on the Irrigation System: (i) Design and construct, at Cities' sole cost and expense, an irrigation meter facility, including all necessary appurtenances thereto, as determined by District, in its sole and absolute discretion (collectively, "Meter Facility") on the New Lateral Sites at such location set forth in the plans for the Meter Facility ("Meter Facility Plans"). The Meter Facility Plans shall be 3 12183.0001/1507323.3 028 subject to review and approval by the District in the same manner as set forth in Section 1(B) of this Agreement and the provisions relating to construction and installation of the improvements shall apply to the design and construction of the Meter Facility. (iii) Design and construct, at Cities' sole cost and expense, to District specifications, the pipelines or facilities shown on Exhibit "D" attached hereto and by this reference incorporated herein in accordance with the Schedule on Appendix A. The pipelines shall be of the type and material as shall be acceptable to the District in District's sole and absolute discretion. The provisions relating to the design, construction and installation of the improvements shall apply to the design and construction of the pipelines described herein. (iv) Design and remove, at Cities' sole cost and expense, to District specifications, the abandonment of pipelines or facilities shown on Exhibit "D" attached in accordance with the Schedule on Appendix A. The manner in which the irrigation facilities are abandoned shall be in compliance with District and USBR requirements and procedures as set forth in the District's Development Design Manual. Upon completion of the replacement portions of the Irrigation System, Cities shall remove the applicable portions of the Irrigation System in accordance with the Plans. 3. Cities' Pre -Plan Check Requirements A. Prior to submitting the Plans to the District for initial plan check, Cities shall do the following: (i) Concurrently with the execution of this Agreement by Cities, Cities shall deliver to District a current preliminary report ("PR") affecting the Cities' Property dated within thirty (30) days of the delivery thereof to District. The District will notify Cities of any title exceptions within the PR which must be subordinated to the lien of this Agreement. Notwithstanding the foregoing, any monetary liens or liens of any covenants, conditions and restrictions must be subordinated to the lien of this Agreement. Cities shall have a period of thirty (30) days after the receipt of written notice to cause the subordination of the items listed in District's notice, as well as any monetary liens or liens of any covenants, conditions and restrictions. (ii) Pay the District's plan check deposit and any amounts necessary to reimburse District for costs incurred in connection with review of the Plans. (iii) Complete and deliver to District the original Bill of Sale on a form supplied by the District. B. Prior to submitting Plans to the District for the second plan check, Cities shall do the following: If applicable to the Project, Cities, at Cities' sole cost and expense, shall furnish to District recorded grant deeds and/or recorded easement document(s) and/or recorded easements proposed to be dedicated in tract maps and/or public rights -of -way, if applicable, in a form satisfactory to District and USBR (with respect to the replacement portion of the Irrigation System) as to content, , location, and width and which assure District's or USBR's unequivocal right to own, operate, maintain, replace, repair, enlarge, reconstruct, remove and improve the improvements to the District's Irrigation System. Cities shall ensure that all deeds of trust, 4 12183.0001/1507323.3 029 mortgages and covenants, conditions and restrictions are reconveyed as to fee ownership and subordinated to the easement(s) set forth herein. Cities shall also ensure that the grant deeds and easements comply with the requirements of the District's rules and regulations. 4. Cities' Plan Approval/Release Requirements Prior to the approval/release of the Plans by the District for the Project improvements, Cities shall furnish to District the approved Plans in CAD format. 5. Cities' Pre -Construction Requirements Following receipt of District's approval of the design and Plans for the Project improvements and prior to the construction thereof, Cities shall do the following: A. Furnish to District, prior to the pre -construction meeting set forth in subsection (C) below, an irrevocable letter of credit ("LOC") or a certificate of deposit ("CD") from a bank or savings and loan located and doing business in the State of California and acceptable to District, naming District as sole beneficiary with the exclusive right of withdrawal according to the following: in the amount of Five Thousand Dollars ($5,000.00) or five percent (5%) of the amount of the abandonment costs for the Irrigation System and construction costs of the irrigation facilities, whichever is greater, as security for the purpose of guaranteeing the appropriate abandonment of the applicable portions of the Irrigation System and completion of construction of the irrigation facilities. Said security shall provide that District has the absolute right five (5) days after the mailing of a written notification to Cities, by certified mail at Cities' addresses herein, to draw all or a portion of the funds represented by the security as may be necessary to complete construction and/or abandonment of the applicable portions of the Irrigation System and including administrative and all other Project costs or to secure compliance with this Agreement, including the construction of the irrigation facilities. Each LOC or CD shall be issued or delivered on a case -by -case basis, for each contract based on the construction required as outlined herein. Said security, less draws, if any, will be returned to Cities, upon the District declaring that the irrigation facilities are final and complete (including, but not limited to, the paving of the road/street/right-of-way above such facilities) in District's sole and absolute discretion. Cities hereby understand, acknowledge and agree that the deternvnation that the irrigation facilities are complete and final may come after District has accepted such facilities. B. Employ, with written concurrence of District, a qualified contractor or contractors (collectively, "Cities' Contractor") properly licensed by the State of California to construct and complete the improvements. C. Arrange, or cause the Cities' Contractor to arrange, a pre -construction meeting with the District. At such meeting there shall be at least one (1) representative of Cities, Cities' Contractor and District. At such meeting, Cities shall be required to pay to District such deposit for inspection as shall be required by District. District shall deduct from said deposit all reasonable cost and expense of District, including, but not limited to, District's agents, 5 12183.0001/1507323.3 ' 030 employees or independent contractors. District shall handle such deposit consistent with the District's rules, regulations and procedures with respect to such deposits. D. Obtain and maintain in full force and effect during the term of this Agreement, the insurance coverages listed on Exhibit "E" attached hereto and by this reference incorporated herein. 6. Cities' Construction Requirements Following satisfaction of the requirements set forth in Section 5, Cities shall construct the improvements in accordance with the following requirements: A. Cities shall, at their sole cost and expense, apply for and obtain all necessary consents, approvals, permits, authority, licenses or entitlements as shall be required for the construction and installation of each facility or improvement from all appropriate governmental authorities. B. Once construction and/or installation of a Project improvement has commenced, Cities shall diligently prosecute the same to completion at no cost or expense to District in conformance with the laws, rules and regulations of all governmental bodies and agencies, including those of the District. C. Cities shall perform, or cause to be performed, all construction and installation of the Project improvements in good, workmanlike and commercially reasonable manner, with the standard of diligence and care normally employed by duly qualified persons in the performance of comparable work and in accordance with generally accepted practices appropriate to the activities undertaken and in compliance with the construction standards set forth herein. Cities shall employ at all times adequate staff or consultants with the requisite experience necessary to administer and coordinate all work related to the design, engineering, construction and installation of the Project improvements. D. Cities shall cause the Cities' Contractor to comply with the applicable OSHA standards and requirements, including following OSHA safety standards and submitting construction and shoring plans as required. E. District shall be under no obligation to protect any Project improvement to be constructed by or on behalf of Cities, or any material, tool, equipment and facilities until written acceptance thereof by District. Prior to the acceptance, Cities shall bear all risk of loss or damage thereto by whatever cause inflicted. Cities shall rebuild, repair, restore and replace or cause to be rebuilt, repaired, restored or replaced, and make. good all injuries or damages to any portion of the Project improvements before completion and acceptance by District and Cities shall bear the expense thereof. F. Cities shall directly pay all costs associated with the construction of the Project improvements, including, but not limited to, furnishing of materials, and Cities shall keep District free and harmless from such costs. 12183.0001/1507323.3 031 G. Each Project improvement shall be installed in strict compliance with the Plans. Any deviations from the approved Plans must be approved by District, in writing, prior to being made. H. Cities are required by this Agreement to install and construct certain Project improvements which may be dedicated to District upon completion thereof in accordance with the terms of this Agreement. Notwithstanding the foregoing, if Cities do not believe that it is required to perform such work in the same manner and subject to the same requirements as would be applicable to District had the District undertaken construction, including, without limitation, the payment of prevailing wages, and other public works requirements pursuant to the California Labor Code, the California Government Code and the California Public Contracts Code, then Cities undertake such construction at Cities' risk. Should it be determined in the future by a court of competent jurisdiction that Cities were required to comply with some or all of the requirements as would be applicable to District had it undertaken such construction, Cities shall indemnify, defend and hold harmless the District Indemnitees (as defined in Exhibit ' ') from all Costs (as defined in Exhibit "F") to which they may be subjected or put, by reason of or resulting from failure to comply with public works requirements, including, but not limited to, the failure to pay prevailing wages or such other requirements as would be applicable to District had it undertaken such construction. I. Cities hereby irrevocably appoint District to inspect the furnishing and installation of the Project improvements. Cities shall provide District representatives with reasonable access for inspection purposes. It is understood and agreed that District's inspection personnel shall have the authority to enforce the Plans, which authority shall include requiring that all unacceptable materials, workmanship and/or installation be replaced, repaired or corrected by Cities' Contractor. Nothing herein shall be construed to grant District direct control over Cities' Contractor or anyone but Cities or their designee. District's inspection does not include inspection for compliance with safety requirements by Cities' Contractor. Any inspection completed by District shall be for the sole use and benefit of District, and neither Cities nor any third party shall be entitled to rely thereon for any purpose. District does not undertake or assume any responsibility for or owe a duty to select, review or supervise the creation of the improvements. 7. Cities' Project Completion and Acceptance A. (i) Upon completion and testing of a Project improvement and/or abandonment of the applicable portion of the Irrigation System, and after final paving, Cities shall give District notice of the same. District shall make a final inspection and provide written notice to Cities either (A) confirming that such improvement has been completed and/or abandoned in accordance with the requirements of this Agreement, or (B) setting forth a punchlist of items that need to be completed or corrected. If District provides such a punchlist, the above -referenced notice and inspection procedure shall be repeated upon completion of the punchlist items. Nothing herein shall be considered a waiver of any warranty, guarantee or other right in favor of the District. (ii) Upon completion and acceptance of each applicable Project improvement and/or abandonment of the applicable portion of the Irrigation System, Cities shall prepare and execute 12183.0001/1507323.3 032 a certificate of completion and final acceptance as to each applicable improvement and record said notice with the Office of Recorder of the County of Riverside, State of California. (iii) Upon receipt of the certificate of completion and final acceptance, the Bill of Sale provided herein shall convey title to the Project improvements (as applicable) at no cost and expense to the District or to the District as agent for USBR.(whichever is applicable). The improvements shall be transferred to District or to the District as agent for USBR (whichever is applicable) free of all liens and encumbrances. Cities shall provide District with the final construction costs of the improvements. (iv) Cities warrant and represent to District that the Project improvements covered hereby shall be free from construction defects for eighteen (18) months. The Cities shall maintain in force the CD or LOC for the duration of the eighteen (18) month guarantee. (v) District shall repair, at Cities' cost and expense, all failures of any Project improvement which was furnished, installed and/or constructed due to faulty materials or installation during the eighteen (18) month warranty period referred to in subsection (iv) above. Cities shall, within thirty (30) days after written demand therefor, pay or cause Cities' Contractor or surety to pay such cost shown on the invoice. Nothing in this subsection or subsection (iv) above shall limit or abrogate any other claims, demands or actions District may have against Cities or Cities' Contractor on account of damages sustained by reason of such defects, nor shall the provisions of this Section limit, abrogate or affect any warranties in favor of District which are expressed or implied by law or set forth in any construction agreement. B. Cities' Engineer shall provide to District all field engineering surveys associated with the construction of the Project improvements, at Cities' sole cost and expense. Cities shall promptly furnish to District all field notes and grade sheets, together with all location, offset, and attendant data and reports, resulting from Cities' field engineering survey and/or proposed facility design changes, all of which have been prepared in accordance with generally accepted engineering practices, and allow District sufficient time to approve or make any required design changes resulting there from prior to construction as part of the District's obligations to review and approve the Plans. Any inspection or review pursuant to this subsection shall be for the sole use and benefit of District, and neither Cities nor any third party shall be entitled to rely thereon for any purpose. 8. Project Close Out Requirements After receipt of the certificate of completion and final acceptance the following requirements shall apply: A. Upon completion of an improvement, Cities shall notify District in writing, and cause contractors and all subcontractors and material men to provide unconditional lien and material releases. B. Cities shall provide District with a declaration by Cities' Contractor that the Cities' Contractor and all persons and entities who furnished material in the construction of the improvements have been paid in full. 12183.0001/1507323.3 1 033 C. All permits, plans and operating manuals related thereto, shall be delivered to and become the sole property of the District, subject to Cities' warranty work and other obligations required hereunder. On the acceptance of a Project improvement, Cities shall deliver to District, at no cost to the District, all surveys and as -built drawings associated with the construction of the Project improvement. 9. [Intentionally Left Blank] 10. General Provisions A. Cities shall assume the defense of, indemnify and hold harmless District Indemnitees and its consultants, engineers, employees and agents and their respective successors and assigns, and each and every one of them, in accordance with the provisions of Exhibit "F" attached hereto and by this reference incorporated herein solely as it relates to the Project improvements undertaken by the Cities. B. Prior to the acceptance of the improvements to be constructed hereunder, Cities shall furnish to District any and all documents reasonably requested by District within possession of Cities. C. All notices provided for hereunder shall be in writing and mailed (registered or certified, postage prepaid, return receipt requested), or by express carrier (return receipt requested) or hand delivered to the parties at the addresses set forth below or at such other addresses as shall be designated by such party and a written notice to the other party in accordance with the provisions of this Section. All such notices shall, if hand delivered, or delivered by express carrier, be deemed received upon delivery and, if mailed, be deemed received three (3) business days after such mailing. DISTRICT: CITIES: Coachella Valley Water District Attention: Jim Barrett, Acting General Manager Post Office Box 1058 Coachella, California 92236 75-151 Hovley Lane East Pahn Desert CA 92211 City of Indio Attention: Grant Eklund; Public Works Director -City Engineer 100 Civil Center Mall Indio, California 92201 City of La Quinta Attention: Tim Jonasson, Public Works Director -City Engineer 78-495 Calle Tampico La Quinta, California 92253 12183,0001/1507323.3 9 11 034 D. This instrument, together with the exhibits attached hereto and other writings referenced herein, contain the entire agreement between the parties relating to the subject matter hereof and supersede any and all prior agreements between the parties, oral or written, and any and all amendments thereto. Any oral representations or modifications concerning this instrument shall be of no force and effect, excepting a subsequent modification in writing, signed by the parties to be charged. E. In the event of any litigation or other action between the parties arising out of or relating to this Agreement or the breach thereof, the prevailing party shall be entitled, in addition to such other relief as may be granted, to its reasonable costs and attorneys' fees. F. If any provision of this Agreement shall be ruled invalid, illegal or unenforceable, the parties shall: (i) promptly negotiate a substitute for the provision which shall, to the greatest extent legally permissible, effect the intent of the parties in the invalid, illegal or unenforceable provision, and (ii) negotiate such changes in, substitutions for or additions to the remaining provisions of this Agreement as may be necessary in addition to and in conjunction with subsection (i) above to give effect to the intent of the parties without the invalid, illegal or unenforceable provision. To the extent the parties are unable to negotiate such changes, substitutions or additions as set forth in the preceding sentence, and the intent of the parties with respect to the essential terms of the Agreement may be carried out without the invalid, illegal or unenforceable provision, the balance of this Agreement shall not be affected, and this Agreement shall be construed and enforced as if the invalid, illegal or unenforceable provision did not exist. G. Each party hereto agrees to execute and deliver such other documents and perform such other acts as may be necessary to effectuate the purposes of this Agreement. H. This Agreement is entered into within the State of California, and all questions concerning the validity, interpretation and performance of any of its terms or provisions or any of the rights or obligations of the parties hereto shall be governed by and resolved in accordance with the laws of the State of California. I. Subject to the obligations of Cities set forth herein, upon accepting title to the Project improvements (as applicable), District or the District as agent for USBR (as applicable) shall assume all rights and obligations of ownership including, without limitation, the operation of the system and the liability related thereto at no further cost to Cities. J. The provisions of the Agreement shall be construed as to their fair meaning, and not for or against any party based upon any attribution to such party as the source of language in question. K. Time is of the essence of this Agreement and each and every term and provision thereof. L. This Agreement shall be construed as if prepared by all of the parties hereto. Accordingly, any rule of law (including California Civil Code Section 1654) or legal decision that would require interpretation of any ambiguities in this Agreement against the party that has drafted it is not applicable and is waived. 10 12153.0001/1507323.3 0 3 5 M. No delay on the part of any party hereto in exercising any right, power or privilege hereunder shall operate as a waiver thereof, nor shall any waiver on the part of any party hereto of any right, power or privilege hereunder operate as a waiver of any other right, power or privilege hereunder, nor shall any single or partial exercise of any right, power or privilege hereunder, preclude any other or further exercise of any other right, power or privilege hereunder. N. Each individual executing this Agreement hereby represents and warrants that he or she has the full power and authority to execute this Agreement on behalf of the named parties. O. Cities shall maintain and make available for inspection by District during regular office hours, accurate records pertaining to the design, construction and installation of the Project improvements to be constructed by Cities. P. This Agreement may be executed in counterparts, each of which shall be deemed an original, but all of which shall constitute but one instrument. Q. The parties agree that any action or proceeding to enforce or relating to this Agreement shall be brought exclusively in the Federal or State courts located in Riverside County, California, and the parties hereto consent to the exercise of personal jurisdiction over them by any such courts for purposes of any such action or proceeding. IN WITNESS WHEREOF, the parties hereto have executed this Agreement on the date and year hereinabove written. DISTRICT: COACHELLA VALLEY WATER DISTRICT, a public agency of the State of California By Its CITY OF INDIO, a California municipal corporation By Its 11 12183.0001/1507323.3 " 036 4 12 12183.0001/1507323.3 CITY OF LA QUINTA, a California municipal corporation Its 037 EXHIBIT LIST EXHIBIT "A" LOCATION MAP EXHIBIT `B" DEPICTION CITY RIGHT-OF-WAY PROPERTY EXHIBIT "C" DESCRIPTION OF PROJECT EXHIBIT "D" DESCRIPTION/DEPICTION OF FACILITIES AND DESCRIPTION OF ABANDONED FACILITIES EXHIBIT "B" INSURANCE EXHIBIT "F" INDEMNITY APPENDIX A SCHEDULE EXHIBIT "A" LOCATION MAP :a -, 039 EXHIBIT "A" LOCATION MAP TOWNSHIP 5 SOUTH RANGE 7 EAST N AVENUESO Z W w eB E W* SECTION LINE W TOWNSHIP 6 SOUTH S a RANGE 7 EAST 0 U VISTA DEL MAR @0o 7 ors u COMM% 191 (ouw OF DIMP VISTA BONITA TR. AVENUE 51 1/4 SECTION LINE BETH CIRCLE H ILLu w I U) POLO ESTATES CT. SECTION LINE AVENUE 52 TOWNSHIP 6 SOUTH, RANGE 7 EAST g 9® 040 f: 0:113 DEPICTION CITY RIGHT-OF-WAY PROPERTY 041 EXHIBIT "B" DEPICTION CITY RIGHT-OF-WAY PROPERTY 1/16 SECTION LINE N L W WBDB E O U I' CVWD LAT. 118.9 S J VISTA DEL MAR @DVV OF u QMDa4Q VISTA BONITA TR. BETH F Lu W OC Z 0 co) G Q 1/4 SECTION LINE AVENUE 51 CVWD LAT. 119.2 CAD LAT. 119.2A/119.6 1/16 SECTION LINE 042 EXHIBIT "C DESCRIPTION OF PROJECT 043 EXHIBIT "C" DESCRIPTION/DEPICTION OF FACILITIES AND DESCRIPTION OF ABANDONED FACILITIES IX. OVWD 14' RCP IRRIG. LINE g -IX. R/W on Z UT. 118. 7/✓ 119.e 32ROPOSED 12' C900 PJC '"IX. 14' RCP IRRIG LINE - __. TO'BE REMOVED _SECTION LINE. IRRIGATION EASEMEENT : - . u�i •, �EX. R/W REC. 3/19/71, INSTR. /27715, O.R. REC. 10/4/73, INSTR. #129822. O.R. IX. R/W R/W FOR DITCHES AND CANALS VISTA BONITA TR. REC.. 1/9/56, BK. 18", PG 2, O.R. IX. COD 45' RCP IRRIG. LINE ..._ .._ IX. R/W-\ V1 ip 7i LAT. 119.2 `48 EK 45'.. RCP IRRIG. LINE47 TO BE RETAOVFD_.. I- - I PROPOSED 42" C905 PVCC IX FENCE-/ - SECTION LINE IX., R/W AVENUE 51 12' IRRIGATION EASEMENT IWM. 11981-79557, O.R. C INSTR. /1984-243D49, O.R. G IX. CVWD 18" ACP IRRIG. UNEJ INSTR. J1998-105939, O.R. -,--,PROPOSED 18' C905 AC SECTION IRJE 58 iy ,c.... 591 LAT. 118.9 60 ,r'o iLi _ _. ... EZ, -a R/W IX. R/W . EX. -18 ACP IF 10. LINE tY IRRIGATION EASEMENT TO BE REMOVED PER M.B. 112/67-69 044 EXHIBIT "D" DESCRIPTION/DEPICTION OF FACILITIES AND DESCRIPTION OF ABANDONED FACILITIES 045 EXHIBIT "D" COST ESTIMATE IRRIGATION LATERAL IDENTIFICATION DESCRIPTION OF WORK EST. CITY. UNITS UNITCOST AMOUNT REMOVE EXISTING RCP IRRIGATION LINE AND LAT. 119.2A/119.6 INSTALL 12" C900 PVC IRRIGATION LINE WITH 80 LF $ 140.00 $ 11,200.00 RESTRAINED101NTS COMPLETE IN PLACE REMOVE EXISTING ACP IRRIGATION LINE AND LAT. 118.9 INSTALL 18" C905 PVC IRRIGATION LINE WITH 100 LF $ 300.00 $ 30,000.00 RESTRAINED JOINTS COMPLETE IN PLACE REMOVE EXISTING RCP IRRIGATION LINE AND LAT. 119.2 INSTALL 42" C905 PVC IRRIGATION LINE WITH 80 LF $ 1,200.00 $ 96,000.00 RESTRAINED JOINTS COMPLETE IN PLACE TOTAL $ 137,200.00 O EXHIBIT "E" MU ►M 047 EXHIBIT "E" INSURANCE REQUIREMENTS 1. Cities or Cities' Contractor shall carry and maintain, at Cities or Cities' Contractor's sole cost and expense, until all of the improvements and/or facilities have been installed or completed, not less than the following coverage and limits of insurance which shall be maintained with insurers and under forms of policies satisfactory to District: (a) Workers Compensation and Employee's Liability: (i) State Worker's Compensation — coverage as required by law. (ii) Employer's Liability with limits of at least $1,000,000 per occurrence. (b) Automobile Liability for Bodily and Property Damage-$1,000,000 per person,$2,000,000 per occurrence. (c) Commercial General Liability for Bodily and Property Damage- $1,000,000 per person, $2,000,000 per occurrence. The foregoing policies shall include, without limitation, owned, nonowned and hired (vehicle) liability, contractual liability, personal injury, blanket commercial, broad form property damage and product/completed operation liability coverage. These policies may contain an aggregate limit not less than the occurrence limit. The required limits may be satisfied by a combination of a primary policy and an excess or umbrella policy. 2. All insurance required pursuant to the express provisions of this Agreement shall: (a) Provide that coverage shall not be revised, cancelled or reduced until at least thirty (30) days written notice of such cancellation, revision or reduction shall have been given to District. In the event any policies or insurance are revised, cancelled or reduced, Cities or Cities' Contractor shall, prior to the revision, cancellation or reduction date, submit evidence of new insurance to District complying with this Section. (b) Be issued by insurance companies, which are qualified to do business in the State of California and which have a rating satisfactory to District and by such rating service as shall be reasonably acceptable to District. (c) Be reasonably satisfactory to District in all other reasonable respects .,.a.. C48 3. The policies required pursuant to this Agreement or a certificate of the policies, together with evidence of payment of premiums, shall be provided to District prior to the commencement of construction of any improvement hereunder. 4. The insurance to be maintained by Cities or Cities' Contractor pursuant to this Agreement above shall: (a) Name District, its officers, employees and agents as additional insureds; (b) Apply severally to Cities and District, their officers, employees and agents; (c) Cover Cities and District as insureds in the same manner as if separate policies had been issued to each of them. (d) Contain no provisions affecting the rights, which either of them would have as claimants if not so named as insureds; (e) Be primary insurance with any other valid and collectible insurance available to the aforesaid additional insureds constituting excess insurance, and each policy shall be endorsed substantially as follows: "The insurance afforded by this policy to District shall be primary insurance and other valid and collectible insurance available to District shall be excess insurance and, under no circumstances, shall be considered contributory." (f) Have a deductible or deductibles, which are no greater than normally maintained for similar projects in the State of California and shall contain a waiver of subrogation and endorsement in favor of the District. 049 EXHIBIT "F" INDEMNITY 050 EXHIBIT "F" INDEMNITY Cities shall assume the defense of, indemnify and hold harmless District and its officers, directors, administrators, representatives, consultants, engineers, employees and agents, and their respective successors and assigns (collectively, "District Indemnitees") and each and every one of them, from and against all . actions, causes of action, damages, demands, liabilities, costs (including, but not limited to reasonable attorneys' fees), claims, losses and expenses of every type and description (collectively, "Costs") to which they may be subjected or put, by reason of, or resulting from: (A) this Agreement: (B) the design, engineering and construction of the Project improvements; (C) the removal and abandonment of the applicable portions of the Irrigation System; (D) the performance of or failure to perform, the work covered by this Agreement which is caused or occasioned by any act or neglect on the part of Cities or their Representatives (as defined below); (E) any death, injury, property damage, accident or casualty caused or claimed to be caused by Cities or Cities' Contractor or their Representatives related to the performance of their obligations under this Agreement or its or their property covered by this Agreement; (F) any breach by Cities of their obligations under this Agreement; and (G) any enforcement by District of any provision of this Agreement. The foregoing indemnity shall not apply to the extent any such Costs are ultimately established by a court of competent jurisdiction to have been caused by the gross negligence or willful misconduct of the District Indemnitees or any of them. District shall make all decisions with respect to its representation in any legal proceeding concerning this Section. If Cities fail to do so, District shall have the right, but not the obligation, to defend the same and charge all of the direct or incidental costs of such defense, including fees and costs, to Cities and to recover the same from Cities. The term "Representatives" shall mean employees, representatives, agents, contractors, subcontractors or any other persons directly or indirectly employed by any of the foregoing or reasonably under the control of any of the foregoing or for whose acts any of the foregoing may be liable. No provision of this Agreement shall in any way limit the extent of the responsibility of Cities for payment of damages resulting from its operations or the operations of any of its Representatives. Cities further covenants and agrees to pay, or reimburse the District Indemnitees, or any of them for any and all Costs in connection with the investigating, defending against or otherwise in connection with Cities' obligations pursuant to this Agreement, except liability arising through the gross negligence or willful misconduct of District Indemnitees, or any of them. District shall have the right, at Cities' expense, to commence, to appear in, or to defend any action or proceeding arising out of or in connection with this Agreement, and in connection therewith, may pay all necessary expenses if Cities fail upon reasonable notice to so commence, appear in or defend any action or proceeding with counsel reasonably acceptable 12183.0001/1507323.3 051 to District. Cities shall be furnished with copies of bills relating to the forgoing upon request. 12183.0001/1507323.3 052 APPENDIX A SCHEDULE 12183.0001/1507323.3 •n -` 053 STATE OF CALIFORNIA COUNTY OF On ss before me, Notary Public, personally appeared , who proved to me on the basis of satisfactory evidence to be the person(s) whose name(s) is/are subscribed to the within instrument and acknowledged to me that he/she/they executed the same in his/her/their authorized capacity(ies), and that by his/her/their signature(s) on the instrument the person(s), or the entity upon behalf of which the person(s) acted, executed the instrument. I certify under PENALTY OF PERJURY under the laws of the State of California that the foregoing paragraph is true and correct. WITNESS my hand and official seal. STATE OF CALIFORNIA ss COUNTY OF (Seal) On before me, Notary Public, personally appeared who proved to me on the basis of satisfactory evidence to be the person(s) whose name(s) is/are subscribed to the within instrument and acknowledged to me that he/she/they executed the same in his/her/their authorized capacity(ies), and that by his/her/their signature(s) on the instrument the person(s), or the entity upon behalf of which the person(s) acted, executed the instrument. I certify under PENALTY OF PERJURY under the laws of the State of California that the foregoing paragraph is true and correct. WITNESS my hand and official seal. (Seal) 12183.0001/1507323.3 .11 � 054 r AGENDA CATEGORY: CITY SA / HA / FA MEETING DATE: December 4, 2012 BUSINESS SESSION: ITEM TITLE: Accept Project No. 2011-12, Stabilization CONSENT CALENDAR: of City Owned Properties STUDY SESSION: PUBLIC HEARING: RECOMMENDED ACTION: Accept Soil Stabilization of City Owned Properties, Project No. 2011-12, as 100% complete; authorize the City Clerk to file a Notice of Completion with the Office of the County Recorder; authorize staff to,release retention in the amount of $8,660; thirty-five (35) days after the Notice of Completion is recorded. EXECUTIVE SUMMARY: The project included the following improvements to meet South Coast Air Quality Management District standards: • Installation of recycled plastic bollards and cable around the City owned properties in The Village • Placement of gravel on four lots between the La Quinta Library and Old Town • Placement of soil stabilizer on the remaining City owned lots. The City Council must accept the improvements in order to complete the contract and allow final payment to the contractor. FISCAL IMPACT: This project was funded with AB 939 and General Fund money. The La Quinta Arts Foundation also contributed funds per agreement for the placement of the gravel. The project budget was $263,449 while the total costs were $182,322 resulting in a balance of $81,127. The remaining funds will be returned to the 055 AB939 account and to the Arts Foundation. CHARTER CITY IMPLICATIONS None of the funding sources require prevailing wages to be paid. BACKGROUND/ANALYSIS: The City of La Quinta and the La Quinta Housing Authority own several properties in the Village (Attachment 1). The properties were unsecured and posed a dust control problem in windy conditions per South_ Coast Air Quality Management (SCAQMD) and Municipal Code Chapter 6.16 requirements. Staff investigated perimeter control measures to secure the properties in order to protect them after chemical soil stabilizers were applied. On October 2, 2012 the City Council approved an amendment to the Facility Use Agreement with the La Quinta Arts Foundation allowing the installation of gravel on Lots A, B, C, & D to act as temporary parking lots for various Old Town and Village related activities and events. The additional cost of gravel versus chemical stabilizer was paid by the La Quinta Arts Foundation. The Arts Foundation contributed $54,000 to the project, of which $45,903 was spent on gravel placement and compaction. This leaves $8,097 to be returned to the Arts Foundation. On September 11, 2012, a Notice to Proceed was issued with a thirty (30) working day contract completion time starting September 17, 2012 and ending on October 29, 2012. The project was deemed substantially complete on November 2, 2012. Per project specifications, no liquidated damages or early completion incentives are recommended. The project's construction effort is now deemed to be 100% complete and in compliance with the plans and specifications. The project finished within the allowed time and under budget. Prior to filing the Notice of Completion, staff must receive authorization from the City Council to approve this project as 100% complete and authorize the City Clerk to file a Notice of Completion. ALTERNATIVES: Staff does not recommend any alternatives to the recommended action. `' 056 Respectfully submitted, 1mothy Jon Public W rks Director/City Engineer Attachment: 1. Vicinity Map 057 0 !!! N N e O O O Q ` i 13 o ' a iYV LiJ Grit F ' rt ` 058 Oe'ittE9 AGENDA CATEGORY: ITY SAMVFA MEETING DATE: December 4, 2012 BUSINESS SESSION: ITEM TITLE: Fiscal Year 201 1 /201 2 City of La CONSENT CALENDAR: lD Quinta Art in Public Places Annual Report STUDY SESSION: PUBLIC HEARING: RECOMMENDED ACTION: Approve the Fiscal Year 201 1 /2012 City of La Quinta Art in Public Places Annual Report prepared in accordance with Chapter 2.65 of the La Quinta Charter and Municipal Code. EXECUTIVE SUMMARY: The City must expend or commit fees from the Art in Public Places program within two years of their receipt and must account for these fees in a separate fund. In addition, administration expenses are limited to less than $25,000 or less than 5% of total funds in the account as of July 15S of any year. FISCAL IMPACT: None. BACKGROUND/ANALYSIS: The City of La Quinta Art in Public Places fund is governed by Chapter 2.65 of the Municipal Code as amended by Ordinance No. 339. The major financial requirements that must• be measured annually for conformance are found in the following Sections as follows: 2.65.110 (F) Reimbursement. In the event fees have not been committed for a use as specified in subsection B of this section within two years of their collection, the Q;5 9 fees in the art in public places fund shall be distributed by the city to the person or entity who has paid the fees or in any other manner permitted by law. 2.65.110 (B) (7) Administrative expenses to otherwise implement any provision of this chapter, however, in no event shall said administrative expenses exceed five percent of the total funds in the account on July 1" of any year or twenty-five thousand dollars in any fiscal year. Staff has prepared the analysis of the Art in Public Places, which disclosed no reimbursements due to contributors and no excess administrative costs (Attachment 1). During the 201 1 /12 fiscal year, the art pieces purchased were Stan's Vision, the 911 memorial, and the Randy Strong Civic Center Art purchase. Staff provided the report and Attachment 1 to the Desert Valley Builders Association (DVBA) on October 1, 2012 pursuant to their written request. On November 7, 2012, the DVBA provided a written response which is included as Attachment 2. ALTERNATIVES: None. Respectfully submitted, Robbey ird, Finance Director Attachments: 1. Art in Public Places Financial Analysis 2. DVBA Letter October 1, 2012 060 City of La Quinta Art In Public Places ATTACHMENT 1 FY 11/12 The Art in Public Places fund is used to account for fees paid in lieu of acquisition and installation of approved art works at approved sites. The fees are refundable if not expended or committed within two years. July 1, 1999 - March 16,2000 Fee calculation - Residential is 1/4 of 1% of value exceeding $100,000 with a $20 minimum - Commercial is 1/2 of 1% of value (no minimum) March 17,2000 - the present Fee calculation - Residential is 1/4 of 1 % of value exceeding $200,000 with a $20 minimum - Commercial is 1/2 of 1% of value (no minimum) Beginning Ending Account Description Fund Balances FY 11/12 Fund Balances Revenues & Other Sources Developer fees 62,680 Interest income 2,150 Credits Applied Donations Insurance recoveries Total Sources 64,830 Expenditures & Other Uses Transfer Out 0 Art purchases 45,786 Maintenance 14,244 Administration 0 Operating 844 Total Uses 60,874 Total Available 861,539 3,956 865,495 Administration Test Expenses Lesser of $25,000 or Available 5.00% 865,495 Budget Actual Under 25,000 43,275 (25,000) 25,000 25,000 061 0 N J c LL LL C m d 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0Lq tO C M M N Z A'S N N C N Nrnr V tD00�OO ON W aDM 47 a7 a7NO V COr CO CD Er a M�T DNOM OctRI:0OYfqqrqqq:N� (D� V t+1�NN('OINN NC6M0 frO MI�(r0 �OOOD �^.. 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Y Y 0 W 0 m W m m U Llm U m ¢00000000000002MI 22 2222E .r:... 065 2012 BOARD OF DIRECTORS PRESIDENT Maeio Gonsales GHA Companies I` VICE PRESIDENT Mark Benedetti BMC 2v° VICE PRESIDENT - Joseph Hayes Fast Bank SECRETARY?REASURER Eileen Eske Pacific Premier Bad VICE PRESIDENT OF ASSOCIATES Allan Levin Allen Levin & Associates PAST PRESIDENT Phil Smith Sunrise Company CHIEF EXECUTIVE OFFICER Gretchen Gutierrez Wesley Admen The Hemmingway Group Brian Benedetti B A B Comraaing Andy Brakebill Coachella Valley Printing Tom Davis Aa Cah guente Bath ofCahuilla Indians Tom DuBose Development Design & Engineering Margaret Drury Margaret Dmry Constmalmt Tommy Fawlkas Coachella Valley Waa District Dave Lippe. Lippert Consomme., Ira Heather Loutzenhizer Pent. Building Group Bmx Maize Fidelity Title Inm anu Tam Noble Noble & Company, LLC Dan Olivier Mueller/Olivier/WhioA,r LLP Alan Pau Para Gemechnical Marvin Roos MSA Comml ing Inc Greg Smith Smith-Kandal lnswenWReal Estate Purick Swa.hmo Imperial Irrigation District Jeff Wattenbarger Wattenbarger Constmction ATTACHMENT 2 desert valleys builders association 34-360 Gateway Drive, Palm Desert, CA 92211 November 7, 2012 Robbeyn Bird, Finance Director City of La Quinta 78-495 Calle Tampico La Quinta, CA 92255 RE: Fiscal Year 2011-2012 Art in Public Places Report Government Code 66000 Annual Report Dear Ms. Bird, Thank you for providing the Desert Valleys Builders Association the opportunity to review the 2011/12 City of La Quinta Art in Public Places and Government Code 66000 Annual Report. After examination we are satisfied that the City of La Quinta has fulfilled its annual reporting obligations pursuant to the Mitigation Fee Act. �ae 066 ce-dT 4 XP Qumrry IT SAMVFA MEETING DATE: December 4, 2012 ITEM TITLE: Fiscal Year 201 1 /2012 City of La Quinta Development Project Fee Report RECOMMENDED ACTION: AGENDA CATEGORY: BUSINESS SESSION: CONSENT CALENDAR: -7 STUDY SESSION: PUBLIC HEARING: Approve the Fiscal Year 201 1 /2012 City of La Quinta Development Project Fee Report prepared in accordance with Government Code Section 66000 and 65865. EXECUTIVE SUMMARY: Per Government Code Section 66000the City must expend or commit developer fees from Infrastructure, Quimby, and Development Impact Funds within five years of their receipt and must account for these fees in a separate fund and report payments pursuant to development agreements entered into after January 1, 2004. Therefore, the Development Project Fee report is prepared annually to demonstrate compliance with this section of the Government Code. FISCAL IMPACT: The City of La Quinta meets the financial reporting requirements of Government Code Section 66000 and 65865 for Fiscal Year 2011 /2012. BACKGROUND/ANALYSIS: The City of La Quinta has three developer project fees subject to the requirements of Government Code Section 66000 - Infrastructure, Quimby, and Developer Impact fees. . 061 Per this code section, the City shall, within 180 days after the last day of each fiscal year, make available to the public the following information for the fiscal year: (A) A brief description of the type of fee in the account or fund; (B) The amount of the fee; (C) The beginning and ending balance of the account or fund. The amount of fees collected and the interest earned; (E) An identification of each public improvement on which fees were expended and the amount of the expenditures on each improvement, including the total percentage of the cost of the public improvement that was funded with fees; (F) An identification of an approximate date by which the construction of the public improvement will commence if the local agency determines that sufficient funds have been collected to complete financing on an incomplete public improvement, as identified in paragraph (2) of subdivision (a) of Section 66001, and the public improvement remains incomplete; (G) A description of each interfund transfer or loan made from the account or fund, including the public improvement on which the transferred or loaned fees will be expended, and, in the case of an interfund loan, the date on which the loan will be repaid, and the rate of interest that the account or fund will receive on the loan. In accordance with these requirements, staff has prepared: • the report which provides an analysis of the Infrastructure, Quimby, Developer Impact fees and development agreement payments for Fiscal Year 2011 /2012 (Attachment 1); • a schedule of development agreement payments received for Fiscal Year 201 1 /2012 in accordance with Government Code Section 65865 (Attachment 2). Staff did receive a request from the Desert Valleys Builders Association (DVBA) to review Attachments 1 and 2. Staff provided the information to the DVBA on October 22, 2012. ' On November 19, 2012, the DVBA provided a written response which is included as Attachment 3. DVBA's response had no issue of the 1•i mechanics of the report. However, they did not take issue with the increased costs of the proposed signalization improvements. ALTERNATIVES: The are no alternatives to the recommended action. Respectfully submitted, RobbeyrPBird, Finance Director Attachments: 1. Development Project Fee Report 2. Development Agreement Report 3. DVBA Letter dated November 19, 2012 tv 069 A 1 1 AUHIVILN 1 -1 City of La Ouinta Infrastructure fee Government Code 66000 Calculation FY 11112 The infrastructure fee fund is used to account for the accumulation of resources, provided through developer fees for the acquisition, construction or improvement of the Cilys infrastructure as defined in Resolution 89- 39. The fee is based upon the attached formula and data sheet and vanes from project to project. Account Description Beginning Fund Balance FY 11l12 Ending Fund Balance Revenues & Other Sources Developer fees Interest income 0 774 total Sources -0-- 774 Expenditures & Other Uses Transfers out - Capital Improvement Project Fund 140,775 Total Uses 140,775 Total Available 407,802 (140,001) 267,801 Five Year Test Usin First In First Out Method June 30, 2012 Remaining Commitment Unspent Uns nt Funds Re resent Endi Fund Balance Revenues Collected from 2002 72,691 72,691 0 Revenues Collected from 2003 70,822 70,822 0 Revenues Collected from 2004 31,458 31,458 0 Revenues Collected from 2005 16,302 16.302 0 Revenues Collected from 2006 24,204 24.204 0 Revenues Collected from 2007 25,293 25,293 0 Revenues. Collected from 2008 14,373 1,304 13,069 Revenues Collected from 2009 7,083 0 7,083 Revenues Collected from 2010 2.039 0 2,039 Revenues Collected from 2011 2,762 0 2,762 Revenues Collected from 2012 774 0 774 Total Ending Fund Balance 267,801 242,074 25 727 Result : Five Year Spent Test Met in accordance with Government Code 66001_ Capital Improvement Facilities Remaining Ca ital Im rovement Facilities FY 11112 Commitment % Complete °� funded with fee Washington St Storm Drain Improv 140,775 0 100.00% 100.00% Whin LOn Dual Left.Tum Lane. -.. Q 742,074 21.07% 35.69% Tofalff] 140,775 242,074 ° '0 7.0 City of La Quinta Quimby Fees Government Code 66000 Calculation FY 11/12 The City has established the Quimby Special revenue fund. The fund is used to account for the accumulation of developer fees received under the provisions of the Quimby Act for park development and improvements. The fee is based upon the attached formula and data sheet and varies from project to project. Beginning Ending Account Description Fund Balances FY 11/12 Fund Balances Revenues & Other Sources Developer fees $7.123 Interest income 19,499 Contributions from property owners 0 Miscellaneous 0 Transfers in 0 Total sources 26,622 Expenditures & Other Uses 0 Transfers out Capital Projects 159,281 Total Uses 169,281 Total Available $8,422,836 ($132,669) $8.290.177 Five Year Test Using First In First Out Method Remaining Unspent Funds Represent Ending Fund Balance June 30 2012 Commitment Unspent Revenues Collected from 2006 $5,008,492 $5,008,492 $o Revenues Collected from 2007 2,209,954 2.209,954 0 Revenues Collected from 2008 708,461 708,461 0 Revenues Collected from 2009 204,441 181,531 22,910 Revenues Collected from 2010 77,977 0 77,977 Revenues Collected from2011 61,353 0 61,353 Revenues Collected from 2012 19,499 0 19 499 Total Ending Fund Balance $Q290,17 ., $8,108,438 $181 739 Result: Five Year Spent Test Met in accordance with Government Code 66001. Capital Improvement Facilities FY 11112 Remaining Commitment % Complete % funded with fee Fitness Equipment $125,000 $0 100% 100% Fritz Bums Dog Park 20,000 0 100°h 100% Senior Center HVAC Upgrade 14,281 0 100% 10.59% Community Park LWW A -0- 8108 438 0.20% 100% Total $159.281 $8 108 438 °' 671 .r H �k §\\\f%°`§ ! ; )a Vol , | /$$(�[�§| ) e§,�=,�«■ Roo ƒ| ...... | !! m#!&«# B& § ! q #!! ! !|3!§|§| / 072 2_ §§R¥ ILLU nMmaai mN N / ) {/\/°%M. MM } )�°�\ )an N nonC6 vi /\a\\C .6§ §2+ !§! Z'£! ) )2\2f! /k °°}°(°J §(6C6C6 W ■ ,�! /) § 6 C6 C6 {J!!!! ) ))/!/!LD �\\\Ci Cq ' ■ AZ®G�•� � - O "O !@ap.; o»- ■ mZV-gM¥ ®! \t kM On 073 a a 8N888m88$NQaaB m °0,-888O88gm'3zzg33ZZ 3PN N m Elms "88N8�aaam03'0z03a _$g8 c°�oiapp 8�0333�3 l7NN-�N�- N_ qq pp_ mm N O^��ml mN �OPN(O M10 N�- ONN� �O )�00-00 _ NI�QNmI �y m OnN�CfOO�ntp�$Oi mi<Py�j � N N ,`o_ `o_ `o 00 0o� `o_ `o_ `o p`o_ q`o p`o_-m LL f1=FFFt-FFFFF-1-mVV R �$ N N � N N U 2 c N Z y8 m Z N m m q E ocy2 zP-, m E � F p o U dLS� �c^�@E. E-oN$�� � cmowE&W=pU m�cm CC pLO m N C O ii pp a 0 O Opp Q IC-0 W p m 6' 4l � O 4 q$� IL C yQ mESi�CWNpNp$JLL gmv<9 ppm�nc�'rc`m Vy aQicm �" �°�EE'Rp_'RonfnmyEa 1 m '> N M m 1` 0 IQ O U F F� Q i F Q LL G f 6 U K J N LL LL 1W F P n�m$oQfam00 NN9 n�° y°off .f mN Qv �S OI Q 6 aqWq 7_ O�j ¢� ON�ry Q N Omu1 Ym O� jV� fGa J��) ]N W� mlV 7NDV O W 1+1 m tttt N = �C O 3 W i g p W's V y 4W4 m m RWR m 0 pNi $ m$ ya nw Qmm Udom oo T�mpnp y oqP Sim. OEUO $1 n E4O m0� L.�� umV6 �LLli �00 WNi p>g -fib m`m o gg 0 "o m5 cg ti o m c o° U >m n U pm N 3 U mnm aqm mo N,n t,�' Ec� - 20a f�4pTc Nac 8�;8 $mDc LL O LL m m cN a W Ubm agmD o .�L na `� 3 W3 .c .cyLL 0 s N m m LL ° g LL m IE S' s m Z V S g 5 Z W � Z C Z � W� 2 W LL W O 074 ATTACHMENT 2 City of La Quints Developer Agreement Activity FY 11/12 For FY 06/07, the following development agreement payment was received for development agreements entered into after January 1, 2004 in accordance with Government Code Section 65865 Date Project Purpose Amount Interest earned Total 10/9/2006 Plaza Estado Fee In lieu of Old Town Parking Requirement 180,000 20,984 200,984 +r" 075 N I 1 /11ir71Y1L1n 1 J 2012 130ARD OF DIRF.C'l'ORS PRESIDC\'I \lpno fionznlCc cnA crt,rtn.d�<, I° VICP, PRIFS'IDENI ❑AIC Pu VIcr PROSIDF� hnepl, Ilnvee Plrsl llanA SECRIlI'ARyn RIIASUREH liilttn re PG IAsili. rcrt.ia IInn4 VICE PRI6SIIIIiuf OF ASSOCIAT1 S Al Inn I.,,p, All,., Iw,in R Ar,ociwca CAST PREFIDIId I' P011>mi0. 9unnu I'ou.pmry ONO: 17M CUI I VE 0111( 1 It r(el[ne� uvr�errr.. W,OI, ALltuvn The Ilcn Inyuvv frouy 13A Rcnalcvi ❑ ,n C.mueni,.g C., it,ILVII1 Co Dwil \'vllm Vriminc A on,;, Ayua Calico¢ nand uPl uhnllla Intllans Tom Dullose Deral,mmnu ncnNr..c E,.R;vrcdno Morgure, Om.. 1lanarer Dmn' Cunvuuaim, Couclwlla Vullcc li'elcr UI>t.ia D.,,c I:R•i.e.r IJPPert ('unRnadua Inr. HuYlhcr ikl. rnbimr Pcou Nuildh.g Gro,.p (Luce Mulzn PidrJ ATlllc Inzunnre Nanlo M ('o•nyagv. LlC Oli, 0 %1 10 1-m vrt)IPoie,lAA'hinnkcr LLP P,Pn Pclm Geomohnical 1lnrvin Roue MSS Can.vhlnp Inc (i r¢N S-11, SmnhRandal lnsnrm,cN R,vI I%alatc Prve;ck u,ul hnpetlxl Irvin ug on pinirvn W""'11leffWat1b,L]: 6O 6'enenncrx, lo.carva,iun desert valleys builders association 34-360 Gateway Drive, Palm Desert, CA 92211 November 19, 2012 City of La Quinta Frank J. Spevacek, City Manager P.O. Box 1504 La Quinta, CA 92247 Re: Development Impact Fee Study — 2012 Dear Mr. Spevacek: Thank you for providing the Desert Valleys Builders Association the opportunity to examine and comment on the 2012 City of La Quinta Development Impact Fee Study. After our initial examination we did have numerous questions and comments. We asked the City to respond and clarify the study and correct the necessary calculations. Nearly, each response was to our satisfaction. Those that weren't have nothing to do with the mechanics of the DIF study, but, the inclusion of certain improvements as they relate to the Level of Service (LOS) (Service- Facility/Nexus) and their cost per service. Our note here is that the inclusion of a want in the General Plan does not create a Nexus to Need determination. This includes a change in level of service (LOS) as to increasing capacity per unit or the increase in cost per unit for future development without its proposed cost share to the existing population. Madison and Avenue 54 - 100% to New Madison and Avenue 60 - 100% to New Monroe and Avenue 54 - 50% to New Monroe and Avenue 60 - 100% to New Madison and Avenue 58 - 100% to New Monroe and Avenue 52 - 25% to New Monroe and Avenue 58 - 50% to New Monroe and Avenue 62 - 251YR to New Each of these intersections has increased costs from $430,000 each to $846,000 each by changing from proposed signalized intersection improvements to round -a -bouts. This increases the facility costs by $2,080,000 or $125 per SFD/SFA. While there isn't an issue with the need for intersection improvements, there is with the cost increase. Some could liken the increase to Gold Plating signal posts. Page 2 DVBA Comment Letter DIF Nexus Study Next Eisenhower and Montezuma (Signal) Eisenhower and Sinaloa (Round -a -bout) Calle Tampico and Civic Center Way (Signal) Orchard and Avenue 50 What are the factors determining a need for signalization or Round -a -bout? LOS? Number of accidents! The issue is whether or not this section should be included in the DIF study. There should be a traffic study determination that shows the current level of service including: The number of trips; the capacity; and, based on expected future development whether or not the current configuration needs adjustment. These intersections do not meet the requirements of the Mitigation Fee Act as the determination of a basic Need has not been made or supported (Traffic Circulation Study). Again, the Desert Valleys Builders Association appreciates this opportunity to review, comment and question the Development Impact Fee Study. We look forward to the City's response and will of course; continue to work with City staff and Council Members on these topics. Respectfully, Gre[cl� en G ierrcz 've Officer 077 AGENDA CATEGORY: ITY SVHVFA MEETING DATE: December 4, 2012 BUSINESS SESSION: ITEM TITLE: Excuse Investment Advisory Board CONSENT CALENDAR: Member David Park from the November 14, 2012 Investment Advisory Board Meeting STUDY SESSION: PUBLIC HEARING: RECOMMENDATION: Approve a request from Investment Advisory Board Member David Park to be excused from the November 14, 2012 Investment Advisory Board Meeting. EXECUTIVE SUMMARY: The La Quinta Municipal Code, Section 2.06.020(B) limits the absences of Board Members to three (3) absences per fiscal year. However, permission can be granted by the City Council and if granted, the absence shall not be counted toward the above -stated limitations. Board Member David Park has requested permission from the City Council to be excused from the November 14, 2012 Investment Advisory Board meeting (Attachment 1). FISCAL IMPLICATIONS: None. BACKGROUND/ANALYSIS: The La Quinta Municipal Code, Section 2.06.020(B) includes the statement: "A board or commission member may request advance permission from the City Council to be absent at one or more regular meetings due to extenuating circumstances, and/or may request the City Council to excuse an absence after - the -fact where such extenuating circumstances prevented the member from seeking advance permission to be absent." If such permission or excuse is granted by the City Council, the absence shall not be counted toward the above -stated limitations. HE ALTERNATIVES: No recommended alternatives at this time. Respectfully submitted, 6UL'7w AN` Robbeyn Bird, Finance Director Attachment: 1. Request from Investment Board Member Park 079 A l l M%prilvir-Im 1 1 November 15, 2012 Robbeyn Bird CITY OF LA QUINTA 78495 Calle Tampico La Quinta, CA 92253 RE: Request for Excused Absence: Investment Advisory Board Meeting November 14, 2012 Dear Robbeyn: Prior to my immediate departure, I sent an email requesting an excused absence from the November 14, 2012 Investment Advisory Board meeting. Upon my return I noticed I had not received a confirmation of receipt from staff advising of my request. Therefore I would like the City Council to consider excusing me from the November 14, 2012 meeting. Thank you for your consideration in the above request. Sincerely, David Park Investment Advisory Board it IT / SA / HA / FA MEETING DATE: December 4, 2012 ITEM TITLE: Demand Register Dated December 4, 2012 RECOMMENDED ACTION: Approve Demand Register Dated December 4, 2012 EXECUTIVE SUMMARY: None. FISCAL IMPACT: AGENDA CATEGORY: BUSINESS SESSION: _ CONSENT CALENDAR: G1 STUDY SESSION: PUBLIC HEARING: Demand of Cash City $738,934.73 Demand of Cash -Successor Agency of RDA $1,530.00 Demand of Cash - HA $0.00 Demand of Cash - HA Comm $0.00 BACKGROUND/ANALYSIS: Between City Council meetings, there is a need to pay some routine bills in order to avoid late fees being charged to the City, as well as payroll and related payroll taxes. These items are listed below: Prepaid Warrants: 97836 - 97847) $16,225.97 97848 - 978531 $93 795.27 Voids) Wire Transfers) P/R 36713 - 367171 P/R Tax Transfers) $ 0 00.00) $189,802.83 . $194,185.58 $52,535.30 .+. 081 Payable Warrants Con't: 97854 - 97955) $194,019.78 $ 740,464.73 In addition, listed below are the most significant expenditures being paid on the regular demand register. Significant Expenditures: Vendor: La Quinta Farms Tylin International B W Simmons Inc 2011-12 ALTERNATIVES: None Respectfully submitted, Account #: Amount: 101-7006-431.32-15 $22,285.05 401-1762-551.34-04 $75,095.85 401-1877-551.45-01 $80,800.02 Robbe n Bird, Finance Director Purpose: SilverRock PM10 Adams Bridge Proj. Soil Stabilization n 082 CITY OF LA QUINTA BANK TRANSACTIONS 11/14/12 - 11/27/12 11/14/12 WIRE TRANSFER - TASC $1,332.60 11/17/12 WIRE TRANSFER - LANDMARK $119,090.40 11/20/12 WIRE TRANSFER - PERS $2,607.91 11/21/12 WIRE TRANSFER - ICMA $8,673.16 11/21/12 WIRE TRANSFER - LQCEA $370.50 11/23/12 WIRE TRANSFER - PERS $57,728.26 TOTAL WIRE TRANSFER OUT $189,802.83 it 083 1 111 m O ul O M IUQ W W N W U r . O m Ill UI W r > Q m N N a s O I O z 1 M rcr W aO 1 a ww r orl z 1=wl 1 Qy 1 Oe PI/IP NmIn N.+bn MM NPNonmMbnN�tbmmMnlfl b 111 .aMmnPO.+.i 00 O I \ 1' 00 OP�tnOMmM nIn mm �t �tPMP N111n . .-. I[. Y1 Q C U W U I . . . . . . . . . .�. . . . .M . U I UN 1 00 nvrr YIOMVPNP .. 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WLLLO oe a o o f v v In In In In ¢y I Y I m m m m m m d W} W O f Z I W O I P P P P P P MWH¢Ixzl a aUmlU 1 .if 1.086 .n M M OM P v O O N O M v O v O O O O Mi W H v m I[1 n v O lf1 r v b N m b v o 20 v m M o b b M b m m M M O M W N 4' U H 1 .n N N If1 W N U W Q m a m z o1 Wr W oe ao a O W Z 2 Z i 1 jw 1 M 1 AN AN 2 z W 1 1 Qy 1 bMP 10 vv oo OIT q' 00 NO NN eN Ob O 1 \ 1 ow" �1vm o0 NN MNOOr .n .1 If m NN 00 0�T mm NO ee �Tv .nb W U 1 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . („) 1 Uy 1 N.mm NN vm.n .+v 00 mm Nr ITIT Obb Nr mm bb vc o.n Q 1 z" I M.yv PPm In In oN b.1,Tcv bb MM bb mm mom MM MM oN MM PN I Q g 1 ... N N N N .•� M u1 m W N M M If 1 h-LL 1 1 M O 1 I S 1 Wf• 1 1 K W 1 Z 1 1 i i NN nN N M ..-N. It1 o N M M o o M Nm 00 i o0 00 0 �f MMMM Q M �t v o O Q Nm I 1 1 bb V�1 m M bbbb N M b M bb NilN P M bM M y 1 OW vv M M M M .N �T M Itly W S 2 1 .1 IT M M Ifl N NNNN m .1 Ifl If1 N N W v o Ifl .+.+ > > 1 b v IT Z O 1 1 1 1 1 1 U 1 mm MM M NmmN O N mm O N O O M mm Y U 1 OO O mOO r•1 O O O O OO Z Q I NO 00 m O =Iflmm NOON O O 0 O 0 O O M0=0 0 O O N 00 Q I Itl Ill N r .n M Itl W to N M o M M If1Y1 M M o M am } 1 1 00 00 o O OOOo o O O o 0o O O N o NO m 1 .� .n .r .1 v .1 .1 .I .r .•1 .1 Y1 .r .•� .y .y .� .� .� .•� Itl .•1 1 1 W 1 F � y 1 r1 1 U W 1 NN NN N N NNNN N N N N NN N N N N NN NO 00 N O NOON N N O O 00 O o O N ee Y NN NN N N NNNN N N N N NN N N N N NN U 'w \\ \\ \ \ \\\\ \ \ \ \ \\ \ \ \ \ \\ W 1 H NN NN r N NNNN N N N N NN N N r n NN S I Q NN NN N N NNNN N N N N NN N N N N NN .1 .1 .•I .� .4 .M .•1 .1 .-1 .4 .1 .4 .i M M N .-1 .4 .1 W .•I .r .y .� ..1 .•1 .•1 .� .1 .M .r .+ .4 .y .r .•1 .y .� .� .1 .y .q J 1 m Q 1 } .00. Q 1 .= 1 a la 1 1 1 y 1 z Z 1 y' I Po O 0 W Po oN N N OoN .•� �T N o . N N N PO O 1 ZO . m o rm mm m mmmm m m m m mm m 0 m (] 1 1 ON NN N O NNNN N e N N oN o N ."1 o NN U 1n NO o0 0 0 oeoN o o N 0 oe N o C o NN Q 1 0 1 0o ee o o NNNN 0 0 0 0 oe - o o a o 00 > 1 1 1 U � y > a H w w W D W y Q 6 z S IW-1 U U y U OC 1 S z Z O Y. i !2- Q Z ILL-r W WF- 1 1 .•1 W Z > J 1' f Y 1 Q z w m Q' 2 O Q OC UI M1' W a Q o In m z m z o z M z I OWN Q O S LL W 6 Q W Q O J Z w Nazi 3 U O 0 Y J w S J J w b OY 1 ZQ 1 q Z w 2 W U W �T w z l W Z I w rl f9 N Q w z 2 X N > rn Q I> 1 Q W U LL O rl K O Z Y OC J O O S w hl h1 N W H W hl W W U U O Q w w O O Y 0 J m w U0. W N 1- > W W F- Z U O 0 w J y 3 U .•� Q Q 1 O HLL 1 NJZ 1 N o N b b b b m M O IT M M N N \ b 1-1 y 1 p: 1 N Ill ••� P .+ NO nv�J 1 0 1 .n m o N m N M O J 1 00 1 W v b Itl b M b \ S W I Z Z I W Q31W . J 1 > a.. W Z 0 0. �T m b N m P o v N M v I[1 b N m G'.000 I 1 N W to W W N b b b b b b b b b' Q K I Y 1 m m m - m m m m m m m m m m m m.. WOFZ 1 W_O_ 1 P P P P P P P P P P P P P P IfP 087 1LR•MQ 1 1 aaumlu 1 N / M OM b M O Ill O N o O e O M O N O M O M O .•1 O O YI O O O P O l[l M I UQ 1 .n I W f 1 rl P o b o M o 0 1 ZO I .I m e O W N K I U f 1 N m N 0 .n m .•I .+ M N N U W 1 ^ ^ a x OZ I i oz 1 N 1 1 ww W LLQ 1 a UIW 1fZI 2K 1 Zr I r+ I O z pl I n I QK I b MM am Illm am NN ee mm as am OO rIl1N a a O \ I N �v am MM am .n .1 eo oa MM Oe rP.nNO eo owP 00 mm, Oe U I W U 1 U 1 UM 1 rl PP o0 bb as MM am .n .n MM bb Nb " NN �WN e0 .•I ^I Mo Q I Z. 1 '1 mm Oe .n.n am vV nN NN .•1 .•1 bb MPbNN PP wV" am rr mP 1 Qq 1 MN 'NN mm NN MM .n-1 mm NM.•Im.n .n .+ N M NN NN N I f LL 1 - m m .n ti r•I .1 q' I 0 I Im K W I 1 $ I v I I 1 O N b a N r P a N aO N o0 �} N �i a O o .n a camO O O 00m O o . .a 1 I I I 1 1 I 1 1 I I I I I 1. I 1 1 1 1 M M M Ill N .n .n Q NN NN b MM Ill b NN y� �t M �t .+ M �M In111 M M M M Ill In In .•1 Ill M M IN .1 N .n .•1 .+.1 .•I .4 .-1 m .•I M M N N w Ill Ill m .n Ill .n N M .n .-1 � 1 M 1 in M Ill N IT c M v v V w Q v N U 1 O O O a b 0 a a a Illama 0 am o b am Y U I vv a e a O O 0 o 0 O mama O a0 0 O ea Z a 1 a e 0 o 0 0 0 o e o000 0 00 0 0 00 Q 1 O o O O 111 N Itl .I M M MMM N MN a N .n .n m 1 1 I 1 1 1 I 11 I I 11 y I O N o O O O -O O O mOOo O oo O O o0 m I Ill N 1t1 .n .r .M .•1 .•1 .n .•1 .•I .•I .r .n .•1 .•I .a .n .•1 .•I w W F ; N I 1 FI I l9 'W N N N N N N N N N NNNN N NN N N NN 1 0 O O O e O m O O OomO O oo O e o0 Y N N N N N N N N N NNNN N NN N N NN U (W I \ \ \ \ \ \ \ \ \ \\\\ \ \\ \ \ \\ w I r 1 n r r r r n n N r NNNN N rN n N Nr N N N N N N N N N NNNN N NN 'N N NN 1 .4 .-1 .•1 .4 .1 .•1 .-1 N .-1 M .4 .•I .4 .i .4 .•1 .1 .i N J 1 m 1 Q 1 > 1001 Q •Z 1 a �LL 1 1 N 1 I z 2 1 r b O b b b m" O NNNN n 0 w In�t PP 1 W M o .•I .•I .4 M a0O o NNN N 11 MM O 1 ZO I m m m w w 0 m m m mmmm w m mm m mm U 1 UZ 1 a 0 o 0 a Cl O O e oo00 O 00 o a ea 1.1 .0 O a O O O a a e O OOa= O 00 O a Oa Q .0 1 O O O O O O O O Omama O 00 O O OO > I Z W W Q U S w w U Z W' M > o W m Z 1 Y 0 1 C'1 O Q W J O Q 1 m M U_ K 1 U U� a F O H z N J wn 1 r=i J W 41 W U > 2 W O Z Z W W U Q W > W I �- r•1 z W W W 1•+ W z 1 z O W > U' W Z OG N f LL z Q I W Q S H O rI Q 1- W f o z M 1 OW 1 Z U w W Q W W W > Z Y b O I OS 1 O K W Z Y z J rn O a W Y 1 ZQ_ 1 w W w W O H W 0 M tw wo U W J N H f 1-1 �. ILL.1 Q I> 1 O O N N f > O f z ~ J b Jm I 1 G W Q Z M H N rl W W W W W O .n Q I > F- a Z 2 3 Q 6' W W W W W z U O I 3 W z W W 0 0 0 0 M O U 0. O S Fn J O O OC Q W w W W W W U S N ^= 1 U U U U f l U U q q O q a a O W W .n 66 I e LL 1 NJzN .n r Ill N .n �t M Ill M b b M M m m \bl•nM I Z N N �t Ill b r O M M P N O m b P P N pn a J 1 0 1 M I[1 M m r N e N P P IN m Ill m NMOJ 1 q0 I b �? b b Ifl M .+ Ill m N b M \S W I ZZ 1 .•1 0Q 3 1 W I J I > q .• 1 P o W ZLLo 1 m P O .n N MV lIl b N m .r N M zQoo 1 b b r r r r r n N N n r m m m -m QK I Y -m m m m m m m m m m m m m m m m WOFZ I WO I P P P P P P P P P P P P P P P P MMUM-xx U MNM oM O N rl O O o M N O \ I YJ 1 O N .•I O O �i �? O P O O O b b O O O O N N N O m �1 W N K I U Y- 1 M N M b �t N m •+ •+ b ^� N h UI W I ¢ m 1 ^ b N LL S 1 N o o 'L 1 1 w w W0 LL a n1 W I Z I z K IZ I -I I z O1 ISwI O v I Qy. I O NN •-I .i oo Comm Oo p0 Oo NMm o0 00 oo MM NN 00 p 1 NI o NN '1 .'I 00 OOeo JV �1 �1 00 MbP eo 00 Oo vbb o0 00 U IWUI .. . U 1 UN 1 IIIrr bb Oo o1f10N b'1; mm .+•-I PN1t 00 00 00 mm, mm NN 00 ¢ 1 Z" I n MM o0 OM =� Me OM .•I .•I NN vw.•I 00 NN NN NN 00 mm 1 ¢q I M NN MM bb NN NNm .-1.1 NN rn I HLL 1 ti.+ MNb - NN I r01 NN I S I WHI 1 ww I zI v1 I 1 1 1 1 b m O nrr M M M 00 0 M .I N O N r N N O O O o �} I•'I o I I M M o NNN M M M MM o M .•I b M N N NNN M M M � 'T M N N N M M W 1 IT . n1 "+ 'I S 1 Z I .1 N N .-I . I •-1 N N N N N M M .+ M M > > I IT�t N N mm v N �t �t'V �T �? 2 0 1 1 I 1 I I I 1 1 1 01 1 Y I U I O O O 000 O O O 00 O O O O O O O 'L I Q 1 O O O 000 O O O 00 O O O O O O O Q I r1 N O .•1 .r .a M, M M MCI O N r h O h r m 1 1 I I 1 1 1 1 1 1 1 I I 1 I y 1 O O o . 000 e O O 00 O O O O o e O m 1 '1 .'I .•1 .+ .•I .•1 .r ..� .q N N '1 r1 ti r1 N .•I .•I ; 1 w w 1 ; H � N 1 M (7 W 1 N N N NNN N N N NN N N N N N N N 1 o O O o00 O O O Oe O- o O o O O O Y 1 N N N NNN N N N NN N N N N N N N w 1 f• h n n rhn h r n rh r h n n r n r x I Q N N N NNN N N N NN N N N N N N N ' I .4 .-1 M .•1 N '1 .'1 .4 .1 M .-1 I••I .4 .'1 'I .1 W .n .1 .1 M .•1 .1 .n .1 ti .I .•I .1 ^I r1 'I '1 .•� '1 J m Q Y 1001 ¢ •z 1 a �a N 1 Z I I N h o N b b W �i �l �1 v �? •� h m M b m b O I I O 0 a0 eoo N N N N N 0 O M w m0 M N O I x0 1 0 m m mmm m m mm m m m m m U I UZ 1 O O o Ooo o O O oo O O o O O O O U In 1 O O e 000 O O O 00 O O O O O O O Q .0 1 O 000 O O O 00 O O O o O O O I> I Z N aW0 Z N H U a IN•I N > w W w w U U U Y W O Z J N K y W J 1 IOi Z U F LL Q 1>-I N Z F S w a J U x z o LL m M z .0w. Q LL Y > K I O S 1 U V wz I WZ 1 J U Z 6 W OL Y Q O 0. Z W w Q 1> 1 W O W K W N 4 z N M J b Jm 1 I F J N 0! O Z w -Q z K N N J D J Z m a0 p N U01 U U U' W (0 I S 0 m > CO I-1 O W O Z O H a 6 N • w I W W W W LL CO UI x 2 x Ir J J J .•I Q Q 1 O HLLI N J z m M It P P r b M .•I o .s n \ b I-1 N 1 I P P h b P O o. N �1 h •-I n nI P .•I b 10 m N �t Noo-i J 1 OO 1 M N .I b �t �1 N b b b .•I �i M N .r \S WIZZI .•I (0 4 3 1 W J 1> W S LL O I W.Coo 1 m m m m m m m P P P P P P P P P ¢y I Y m m m m m m m m m m m m m m m m LL COYY I U r r r r r r r r r r h r r r r n W OF•ZIWOI OHJQQ wwI-14 I Sz 1 ^' LLaUm IU 1 �1 IlI M 1 O M 1 N O M b o O O �i If1 o r 1!1 O e O .Mi I W F 1. n O m n b o .+ w O �t N Ill b 111 o I SO I Ill r 111 b r n b nl N W b WNW I U r 1 M N N .+ N P - •+ b N UI W Q m 1 w a 2 1 oz 1 1 w 1 wu W �. 1 1 ao 1 1 a W 12 zZ1 2 C I w l w I OQ 1 +1 � * a rt w r z r w w • AN x AN z O I 2 1 S W W 1 1 Q" I MM oo MM Prb op Op Oe ON=, 111%T po rr Ill if1 00 Oo Opp MNN O 1 \ I PP eo Ill lfl wlnr NN 00 00 00 %T �t 00 OO �t �t oO 00 000 PNI/l u 1 WON U 1 Z. I mm rn OO Nbm nn bb oo w.1 ww OO �t �? NN l[1111 bb ONfl mq" Q 1 2w 1 mW rn 1/ 0 MOO rn nr bb ww NN ILl u1 MM MM �t �t ww -,.N 1[I ATM I Qq 1 MM PMN NN w1•+ NN PP .-Iw bb w.rN w I F 1 w O I IS 1 W f 1 I K W I 2 I v I 1 I I w M m P P M O M N w O o P M M mw Nww O m Ill in O M O Ill p IT m b N O O I 1 1 1 11 I 1 1 1 1 1 I 1 1 1 I" 1 1 1 1 I 1 b M M MM M o M b b o M M M M MM bbb p• 1 1 m M w M 111 Ill M %7 V � m lfl W m 1 m z 1 If1 .•I P m o w N n1 m lit m w �+ m 'I P N N .•I S Z I '1 W .+ lIl W W v W W N N w Yl lfl w w N -,-N. � 1 = I 2 1 O I 1 I 1 11 1 I I 1 I 1 1 1 I I 1 1 11 I I ON w N m Ill Ill M O N N b O o lfl N O mill Ow Y UI o O om m O o O O IB- O e o o O Ow O=e mm Z Q I o o O In o 0 o e o e O o o eO 1NN= Q 1 � M 111 MM InM M M Ill O o M M O 111 11 N N m 1 I 1 1 I 1 I I I I 1 1 1 1 I 1 I I 1 w .•1 .1 .� w w .1 nl .1 nl e-I .•I .r .M rl nl .1 N w 00= y 1 O O O 00 o e o o O o O o O o 00 m .•1 '1 w w .1 .-1 w w ..I .1 .•I 1[1 w rl 111 .-I w 1[1 .1 .O W W I F 1 m 1 w 1 (1f 1 W 1 N N N NN N N N N N N N N N N NN NNN Q•• 1 '1 'I rl '1'1 w rl rl '1 '1 .4 M '1 w '1 rl w '1'1 1 O O O 00 O O O O O O O O O O 00 000 Y 1 N N N NN N N N N N N N N N N NN NNN w 1 f.. r n n nr n r n r r r n r r r rr nnr S I Q N N N NN N N N N N N N N N N NN NNN U No \ \ \ \\ \ \ \ \ \ \ \ \ \ \ \\ \\\ 1 w �-1 w rl w rl w e1 •-1 M w '1 '1 '•1 w w N w 11 w W 1 w '1 N w w '1 ^I '•1 '1 w '1 M '1 w '1 w N IY w'1 J m 1 1 a > .00. a •z I a .a m F 1 > I W W O N O o0 N It N O e w N M O Oe awo O 1 SO I m m m NOW m m m m m 0 m m m m m Now fl 1 U2 1 O O O oe O O e O O e O e O e 0o o U 1 0 1 e O o Oe O o O O e O mO o m 0woo O Q 1 0 1 e o 0 00 0 o p o p m o p o o po 000 > 1 u Q 1 M 1-1 I # J W 6 1 2 K 1 M Q UI f O O ~ M z � Izy - Iy w W F• O O 1 1• S � K Z U d f O w U J 1 m W J U U S j l.1 R W J q W 3 Z w Q J W W 2 q Z W W w W m Z K f O w 1 K Q z u w 2 O Z W w J w H O W W O M Z I OWN p. Q w Q W > LL Q > > d• U ql S 6 K I OS 1 O 1 1 J Q Q 1 n O Q W b OY 126 1 Y O O 3 U ^ z N < K O q V H Q I> I 12-I W m N Z Z N d O Q Z ^ m W b J m 1 I I w H w Z N z F- O O O F- u w Q I N J 2 Y F• Q O w W W 2 U w f w w UO I 1 m m (9 K LL nj 1 1 Q W w O Q U W w O O O Q w O LL N ^C 1 1 J J J J S S S S S S S S 2 Z Z O Q Q 1 o I- LL I N J Z I N n P p Ill �t r n Ill .'1 w m P 111 w w \bwm I y m w M m N r �1 M P r o b m b r v n V O J 1 0 w N N �t m lfl P Ill No N M OJ I g 1 N •+ v b W b b \ S W 1 2 Z 2 1 w (pQ3 I W 1 J I > I W SLLO I P O w N MV m b n m P O w N M ^I p: Q O p I P O O O O O O O P O P O P O P rl P "I P •"I P "'I P P Qp• I Y m P P P P r P r P n n n .r r n n n n n 1mYY I U I n r r r P P P P P P P P P P P P P P P P , K Of I~•I 6 1 S 2 1 090 aauaa 1 u 1� III I[I M 1 O M 1 n P O �T b O o O N O Ii1 O O O o \ 1 YJ 1 w m O w I o e I MI P b b M O o m III H M b + H W N O! 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EXECUTIVE SUMMARY: The City Clerk as Elections Official is required to submit the certified results of the election to the governing body within 28 days of the election. Per the Election Code, the City Council shall certify that the person receiving the highest number of votes for each office, and that the person who receives a plurality of the votes cast for any office is elected to that office. The following candidates received the highest number of votes cast: For Mayor: DON ADOLPH For Council: KRISTY FRANKLIN and LEE OSBORNE FISCAL IMPACT: None. BACKGROUND/ANALYSIS: At the June 5, 2012 meeting, the City Council adopted Resolution No. 2012-026 giving notice of a General Municipal Election to be held on Tuesday, November 6, 2012 for the election Mayor and two City Council Members. The election was held on November 6, 2012 and the voters elected Don Adolph as Mayor, and Kristy Franklin and Lee Osborne as Council Members. 096 The Riverside County Registrar of, Voters provided the Certification of Election Results to the La Quinta City Clerk on November 28, 2012. The certified results are attached to the Resolution as Exhibit A. The City Council is now requested to certify the election results. It is further recommended that the City Clerk administer the Oath of Office and deliver a Certificate of Election to each person elected. ALTERNATIVES: There are no alternatives to the recommended action. Respectfully submitted, Susan Maysels, City Clerk 097 RESOLUTION NO. 2012 - A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF LA QUINTA, CALIFORNIA, RECITING THE FACT OF THE GENERAL MUNICIPAL ELECTION HELD ON THE SIXTH DAY OF NOVEMBER, 2012, DECLARING THE RESULTS AND SUCH OTHER MATTERS AS PROVIDED BY LAW WHEREAS, a General Municipal Election was held and conducted in the City of La Quinta, California, on Tuesday, November 6, 2012, as required by law; and WHEREAS, notice of election was given in time, form and manner as provided by law, candidates were nominated to fill the vacancy or vacancies as provided by law; the election was held and conducted and the votes were cast, received and canvassed and the returns made and declared in time, form and manner as required. by the provisions of the laws of the State of California relating to General Law cities and the Charter of the City of La Quinta; and WHEREAS, the Riverside County Registrar of Voters canvassed the returns of the election and has certified the results to the City of La Quinta, and said results are received, attached and made a part hereof as Exhibit "A"; and WHEREAS, said General Municipal election was held for the purpose of electing the following officers of said City as required by the laws relating to cities in the State of California, to wit: • One (1) Mayor of the City Council of said City for the full term of two years; • Two (2) Members of the City Council of said City for the full term of four years; NOW, THEREFORE, BE IT RESOLVED by the City Council of the City of La Quinta, California, as follows: SECTION 1. That the names of persons voted for at said election for Mayor of the City Council of said City is as follows: DON ADOLPH TERRY HENDERSON LAWRENCE V. PONCE ROBERT F. SYLK 098 Resolution No. 2012- November 6, 2012 Election Results Adopted: December 4, 2012 Page 2 SECTION 2. That the names of persons voted for at said election for Members of the City Council are as follows: KRISTY FRANKLIN BRIAN WILLIAM HANRAHAN LEE OSBORNE ROBERT RADI SECTION 3. The City Council does declare and determine that DON ADOLPH was elected as Mayor for the full term of two (2) years; and KRISTY FRANKLIN and LEE OSBORNE were elected as Members of the City Council for the full term of four (4) years. SECTION 4. That the City Clerk shall immediately make and deliver to each of the persons so elected, a Certificate of Election signed by the City Clerk and authenticated; that the City Clerk shall also administer to each person elected, the Oath of Office prescribed in the Constitution of the State of California and shall have them subscribe to it and file it in the Office of the City Clerk. Each and all of the persons so elected shall then be inducted into the respective office to which they have been elected. SECTION 5. That the City Clerk shall certify to the passage and adoption of this resolution and enter it into the book of original resolutions. i PASSED, APPROVED, and ADOPTED at a regular meeting of the La Quinta City Council held on this 41h day of December, 2012, by the following vote: AYES: Councilmembers NOES: ABSENT: ABSTAIN: DON ADOLPH, Mayor City of La Quinta, California 099 Resolution No. 2012- November 6, 2012 Election Results Adopted: December 4, 2012 Page 3 ATTEST: SUSAN MAYSELS, City Clerk City of La Quinta, California (CITY SEAL) APPROVED AS TO FORM: M. KATHERINE JENSON, City Attorney City of La Quinta, California 100 EXHIBIT A 14 Qd 4/Y s * fe u Kai! Verjil Registrar of Voters 44., ,64% REGISTRAR OF VOTERS COUNTY OF RIVERSIDE Rebecca Spencer Assistant Registrar of Voters CERTIFICATE OF REGISTRAR OF VOTERS TO THE RESULTS OF THE CANVASS OF ELECTION RETURNS State of California } ) ss. County of Riverside ) I, KARI VERJIL, Registrar of Voters of said County, do hereby certify that, in pursuance of the provisions of Sections 15301, 15372, and 15374 of the California Elections Code, and the resolution adopted by the City Council, I did canvass the returns of the votes cast on November 6, 2012, as part of the Consolidated Presidential General Election in the CITY OF LA RUINTA and I further certify that the statement of votes cast, to which this certificate is attached, shows the whole number of votes for each candidate for elective office at said election, in said City, and in each precinct therein, and that the totals as shown for each candidate are full, true, and correct. Dated this 261n day of November 2012. lit ;y KA#21 VERJIL f b Registrar of Voters { �., 2724 Gateway Drive. Riverside, CA 92507.0918 - (951) 486.7200 • FAX (951) 486.7272 • TlY (951) 697-8966 www.voteinfo.net 101 1112024:36 PM RIVERSIDE COUNTY Statement of Vote 289 of 830 November 6.21112 CONSOLIDATED PRESIDENTIAL ELECTION 100065 CITY OF LA OUINTA z x w 2 x y m 5 0 J Ago $ O r 5 m V C O Z mSICq ~ m gS 19 5 S� 46002 IAQIIIMA 1947 671 34.46 252 126 in 13 27C 255 171 46002 - Vole by Mal Repablp 1947 871 44.74 37 • ISO 208 14 440 ISO 447 243 46007 L 01JIMA 1997 712 35.65 271 138 154 is 274 118 283 158 46007- VOte by "I Roper" 1907 ON 44.67 An 144 201 IS Ale 1 sa 433 235 45009 LAQUINTA 1585 AM nod 156 85 121 15 173 So 173 120 A6009- Vole by Mail Repollag load 738 4662 306 143 lw 1 a 321 159 337 214 46012 I OUNTA on 262 MAE 84 39 63 9 100 85 w 50 4SO12- Vote by Mein Repoft ago 610 61.52 217 66 134 13 216 Ile 244 126 45018 I (MNTA 1173 325 27.71 130 72 72 10 123 SO 133 et 46016- Vote by Mal Reponm9 1173 673 5737 wa 55 152 11 35e 0 347 101 46018 IACUNTA 1727 528 3057 let 130 125 32 160 111 207 166 46018- Vote by Mal Reporting 1727 673 3597 275 117 161 36 247 165 290 223 46019 IACIANTA 1984 539 27.17 217 at 132 15 205 101 224 131 46019-V.M by Mal Rep=q 1984 977 49.24 437 141 283 18 455 let 498 281 45021 LACUMA low 309 2835 124 85 73 11 127 42 153 95 46021- Vole by Mail Rep=.. low US 59.17 297 132 151 10 334 85 357 190 46024 LACUNA 112C Sol 3134 130 80 78 12 116 75 114 114 46024- Vale by Mel Repmbng 1120 Ala 36 R6 155 76 121 15 154 108 183 Im 46026 IACUMA 1351 443 3279 147 95 Ill 139 114 167 121 46025-Vote by Mal Repo g Iasi 512 37,90 ISO Do ISO 34 too 114 234 173 46)28 UCUMA 1512 03 3525 207 113 123 20 157 122 195 151 48028 - VoM by Mel Reporting 1512 08 4220 339 119 Ill 26 316 132 312 201 48039 IACUMA 1896 532 28.03 278 75 85 9 216 56 241 10e 46039 - VOW by Mal ROPMT19 1598 1085 5717 60 197 165 10 530 101 576 247 45044 UCUMA c 0 000 0 0 0 0 0 0 0 0 46044- VOW by Mail Repming 0 0 0.00 0 0 0 0 0 0 0 0 46046 L CUINTA Ina to 1.44 7 3 4 0 5 4 3 46046- Vele by Mel RepNing 1253 1124 89.70 495 262 249 8 520 143 013 305 P.WTatab 19627 Says 29.01 2194 1107 12M 1N 2064 INS 2243 1471 Vote by Mal Ro"rig TOW. 1N27 V765 4071 M05 1763 2267 no 447a 1676 4871 2750 Clan Total, 1N27 15449 78.71 6599 M70 3551 426 8537 2721 7114 4221 RIVERSIDE CDID 19627 16449 7871 6599 287 not 426 6537 2721 7114 4221 301e Congr wMnel Dowd 19627 15479 76.11 6599 070 Mal 46 6517 2721 7114 4221 Zell Senatorial Delta 1N27 164AW 7&71 6599 070 W51 426 6537 2T21 7114 4221 42n6 Aawmdy District IN27 15449 7871 6599 287 3551 42e 6537 2721 7114 4221 St 60d Egweialron DR 4 19627 15449 7871 6599 2870 3551 AM 8537 2721 7114 4221 41A SUERVISCRIA L DISTRICT 19027 15449 78.71 6599 2870 3551 426 6537 2721 7114 4221 Gly a Le QV08 1 1N27 15449 78 T1 6599 2870 3551 AM 6537 2721 7114 4221 4 102 Titf 4 4 a" CITY SA / HA / FA MEETING DATE: December 4, 2012 ITEM TITLE: Select a Mayor Pro Tempore RECOMMENDED ACTION: AGENDA CATEGORY: BUSINESS SESSION: 2- CONSENT CALENDAR: STUDY SESSION: PUBLIC HEARING: Select a member of the City Council to serve as Mayor Pro Tempore. EXECUTIVE SUMMARY: The selection of Mayor Pro Tempore is governed by State law and City resolution. State law requires the City Council to choose one of its number as mayor pro tempore at the same meeting it declares the results of a general municipal election (even numbered years). The City resolution setting Council Rules of Procedure states that the office of mayor pro tempore shall automatically be reconsidered by the Council at the second regular meeting in November of each odd numbered year. FISCAL IMPACT: None. BACKGROUND/ANALYSIS: Resolution 2006-1 15 prescribes that the selection of a mayor pro tempore shall be by three or more affirmative votes, and a failure to achieve such total of affirmative votes, shall be deemed a selection of the incumbent to remain in office. The Resolution also stipulates that a successor mayor pro tempore may be chosen at any time by three or more affirmative votes. Therefore, the term of mayor pro tempore is from November to November every 4 103 year unless a successor is chosen during the intervening months by three or more affirmative votes. The office has been held by the following officials in recent years: 2000 to 2007 — Mayor Pro Tem Sniff 2008 — Mayor Pro Tem Osborne 2009 — Mayor Pro Tem Henderson 2010 — Mayor Pro Tem Franklin 2011 —Mayor Pro Tem Evans 2012 — Mayor Pro Tem Henderson ALTERNATIVES: There are no alternatives to the recommended action. Respectfully sbbmitted, Susan Maysels, City Clerk 104 Tait 4 4129&M AGENDA CATEGORY: IT A/HA/FA MEETING DATE: December 4, 2012 ITEM TITLE: Comprehensive Annual Financial Report for the Year Ended June 30, 2012 RECOMMENDED ACTION: BUSINESS SESSION: z CONSENT CALENDAR: STUDY SESSION: PUBLIC HEARING: Approve, receive and file the Comprehensive Annual Financial Report (CAFR) for the year ended June 30, 2012. EXECUTIVE SUMMARY: The City is required to obtain an audit of the financial statements annually by an independent auditor. The June 30, 2012 audit has been completed and Lance Soll & Lunghard, LLP, the City's independent auditors, have issued an unqualified opinion on the financial statements. A component of the audit is an evaluation of the internal controls of the City Finance Department and the issuance of a management letter noting material weaknesses in those controls. The auditors did not find any such weaknesses. The CAFR is attached for your review to approve, receive and file. FISCAL IMPACT: None. BACKGROUND/ANALYSIS: At the end of every fiscal year, the financial records of the City are audited by an outside independent audit firm. The City then prepares an audited financial report after recommended audit changes are made (CAFR) (Attachment 1). In addition to the CAFR, two letters addressed to the City Council accompany the CAFR which 105 present a Report on Internal Controls (Attachment 2) and a Management Comment Letter (Attachment 3). If the auditors identified discrepancies regarding internal financial management controls and financial management practices, these discrepancies would be identified in these Letters. No discrepancies were identified. The CAFR presents the following financial highlights for FY 201 1 /2012: CITY-WIDE FINANCIAL AND AUDIT HIGHLIGHTS: • The assets of the City of La Quinta exceeded its liabilities at the close of the most recent fiscal year by $688,166,000 (net assets). Of this amount, $85,087,000 (unrestricted net assets) may be used to meet the government's ongoing obligations to citizens and creditors. • The governmental activities total net assets increased by $169,967,000 and the Business -Type total net assets decreased by $212,000 attributable to SilverRock Golf Course. The primary reason for the increase in net assets in the governmental activities is due to the dissolution of the Redevelopment Agency resulting in an extraordinary gain. • As of the close of the current Fiscal Year, the City of La Quinta's governmental funds reported combined ending fund balances of $107,132,000, a decrease of $86,239,000 in comparison with the prior year. GENERAL FUND FINANCIAL AND AUDIT HIGHLIGHTS: • During the current Fiscal Year, the general fund net loss was $1,205,000. Continuing appropriations of $1,041,000 of General fund balance have been designated. The following is a breakdown of the General Fund Balances for Fiscal Years 201 1 /2012 and 2010/201 1: ".4 106 Nonspendable Deposits Prepaid Costs Land held for resale Advances to other Funds Subtotal Restricted Debt service Committed Emergency reserves Post retirement health benefits Subtotal Assigned Carryover appropriations Unassigned Cash flow reserve Future Operational deficit Operations/projects/transfers Subtotal Total General Fund Reserves 2012 118,516 27.481 8,320,000 15,417,929 23,883,926 173,426 17, 516, 295 1,523,401 19,039,696 2011 9,967 23,260 8,320,000 15,373,104 23, 726, 331 169,631 18, 018, 595 1,258,659 19, 276, 654 Change 108,549 4,221 44,825 157,595 3,795 (502,300) 265,342 (236, 958) 1,041,172 1,768,494 (727,322) 3,185, 984 5,253,355 39, 298, 522 47, 737, 861 91,876,081 3,304,383 7,500,000 37, 336, 061 48,140,444 93, 081, 554 (118,399) (2,246,645) 1,962,461 (402, 583) (1,205,473) The emergency and cash flow reserves are calculated based on a percentage of the operating budget expenditures. Both of these reserves decreased due to reductions in the 2012/2013 budget. The future operational deficit reserve was $7,500,000 at June 30, 2011. This reserve decreased by the net loss of $1,205,473 and the carryover of appropriations by $1,041,172 for fiscal year ended June 30, 2012. ...n 101 OTHER AUDIT HIGHLIGHTS: • The auditors rendered an unqualified opinion which states that the financial statements present fairly, in all material respects, the financial position of the City of La Quinta. • The auditors detected no deficiencies in internal controls. A more detailed discussion of the financial statements is found in the Transmittal Letter and the Management Discussion and Analysis sections contained in the CAFR. Mr. Bryan Gruber, CPA an Audit Partner of Lance Soil & Lunghard, LLP, will be attending the December 4, 2012 Council meeting and will present their findings and will answer questions regarding the CAFR. ALTERNATIVES: There are no alternatives to he recommended action. Respectfully submitted, RobbeynoBird, Finance Director Attachments: 1. Comprehensive Annual Financial Report for the year ended June 30, 2012 2. Report on Internal Control 3. Audit Management Letter 108 ATTACHMENT 1 CITY OF LA QUINTA, CALIFORNIA COMPREHENSIVE ANNUAL FINANCIAL REPORT YEAR ENDED JUNE 30, 2012 109 CITY OF LA QUINTA, CALIFORNIA COMPREHENSIVE ANNUAL FINANCIAL REPORT YEAR ENDED JUNE 30, 2012 Prepared By FINANCE DEPARTMENT w, 110 THIS PAGE INTENTIONALLY LEFT BLANK CITY OF LA QUINTA COMPREHENSIVE ANNUAL FINANCIAL REPORT JUNE 30, 2012 TABLE OF CONTENTS Page Number INTRODUCTORY SECTION Letterof Transmittal................................................................................................................................. i Listof Principal Officials....................................................................................................................... vill OrganizationalChart .............................................................................................................................. ix Certificate of Achievement for Excellence in Financial Reporting(GFOA).............................................x FINANCIAL SECTION Independent Auditor's Report .................................................................................................................1 Management's Discussion and Analysis.................................................................................................3 Basic Financial Statements Government -Wide Financial Statements: Statementof Net Assets.................................................................................................................17 Statementof Activities....................................................................................................................18 Fund Financial Statements: Balance Sheet — Governmental Funds..........................................................................................20 Reconciliation of the Balance Sheet of Governmental Funds to the Statement of Net Assets.......................................................................................................23 Statement of Revenues, Expenditures and Changes in Fund Balances — Governmental Funds...................................................................................................24 Reconciliation of the Statement of Revenues, Expenditures and Changes in Fund Balances of Governmental Funds to the Statement of Activities .......................26 Budgetary Comparison Statement by Department — General Fund..............................................27 Budgetary Comparison Statement — Housing Authority PA No. 2.................................................28 Statement of Net Assets — Proprietary Funds................................................................................29 Statement of Revenues, Expenses and Changes in Fund Net Assets — ProprietaryFunds...........................................................................................................................31 Statement of Cash Flows — Proprietary Funds...............................................................................32 Statement of Fiduciary Net Assets - Fiduciary Funds....................................................................34 112 CITY OF LA QUINTA COMPREHENSIVE ANNUAL FINANCIAL REPORT JUNE 30, 2012 TABLE OF CONTENTS Page Number Statement of Changes in Fiduciary Net Assets - Fiduciary Funds.................................................35 Notesto Financial Statements..............................................................................................................37 COMBINING AND INDIVIDUAL FUND STATEMENTS AND SCHEDULES Combining Balance Sheet - Non -Major Governmental Funds.......................................................82 Combining Statement of Revenues, Expenditures and Changes in Fund Balance - Non -Major Governmental Funds.......................................................................92 Budgetary Comparison Schedules — Special Revenue Funds StateGas Tax.......................................................................................................................101 Library....................................................................................................................................102 FederalAssistance.................................................................................................................103 SLEBG...................................................................................................................................104 IndianGaming........................................................................................................................105 Lightingand Landscaping......................................................................................................106 Quimby...................................................................................................................................107 Congestion Management Air Quality Fund............................................................................108 PublicSafety..........................................................................................................................109 ArtIn Public Places................................................................................................................110 SouthCoast Air Quality ..........................................................................................................111 AB939...................................................................................................................................112 LawEnforcement...................................................................................................................113 Proposition1B Fund...............................................................................................................114 Justice Assistance Grant........................................................................................................115 HousingAuthority PA No. 1...................................................................................................116 Low/Moderate Income Housing PA No. 1..............................................................................117 Low/Moderate Income Housing PA No. 2.............................................................................118 Budgetary Comparison Schedules — Capital Projects Funds CapitalImprovement..............................................................................................................119 CivicCenter............................................................................................................................120 Infrastructure......................................................................................................................... A 21 Transportation........................................................................................................................122 Parksand Recreation.............................................................................................................123 LibraryDevelopment..............................................................................................................124 CommunityCenter.................................................................................................................125 StreetFacility..........................................................................................................................126 ParkFacility ............................................................................................................................127 FireFacility.............................................................................................................................128 2011 Low/Mod Bond..............................................................................................................129 2004 Low/Mod Bond..............................................................................................................130 113 CITY OF LA QUINTA COMPREHENSIVE ANNUAL FINANCIAL REPORT JUNE 30, 2012 TABLE OF CONTENTS Page Number Redevelopment Agency PA No. 1 — Capital Projects............................................................131 Redevelopment Agency PA No. 2 — Capital Projects............................................................132 Budgetary Comparison Schedules — Debt Service Funds Redevelopment Agency PA No. 1 — Debt Service.................................................................133 Redevelopment Agency PA No. 2 — Debt Service.................................................................134 FinancingAuthority................................................................................................................135 Combining Statement of Net Assets — Internal Service Funds....................................................138 Combining Statement of Revenues, Expenses and Changes in Fund Net Assets — Internal Service Funds...............................................................................139 Combining Statement of Cash Flows — Internal Service Funds...................................................140 Combining Balance Sheet —All Agency Funds............................................................................142 Combining Statement of Changes in Assets and Liabilities — All Agency Funds .........................143 STATISTICAL SECTION NetAssets by Component............................................................................................................146 Changesin Net Assets.................................................................................................................148 Changes in Net Assets — Governmental Activities.......................................................................150 Changes in Net Assets — Business -type Activities.......................................................................152 Fund Balances of Governmental Funds.......................................................................................154 Changes in Fund Balances of Governmental Funds....................................................................156 Assessed Value and Estimated Actual Value of Taxable Property ..............................................158 Assessed Value and Estimated Actual Value of Taxable Property - RedevelopmentAgency...............................................................................................................159 Direct and Overlapping Property Tax Rates.................................................................................160 Principal Property Taxpayers.......................................................................................................162 Property Tax Levies and Collections............................................................................................163 Ratios of Outstanding Debt by Type.............................................................................................164 Ratio of General Bonded Debt Outstanding.................................................................................166 Directand Overlapping Debt........................................................................................................167 Legal Debt Margin Information.....................................................................................................168 . 114 CITY OF LA QUINTA COMPREHENSIVE ANNUAL FINANCIAL REPORT JUNE 30, 2012 TABLE OF CONTENTS Page Number Pledged -Revenue Coverage........................................................................................................170 Demographic and Economic Statistics.........................................................................................171 PrincipalEmployers......................................................................................................................172 Full-time City Employees..............................................................................................................173 OperatingIndicators.....................................................................................................................174 Capital Asset Statistics.................................................................................................................175 Schedule of Insurance in Force....................................................................................................176 115 P.O. Box 1504 LA QUINFA, CALIFORNIA 92247-1504 78-495 CALIF. TAMPICO (760) 7 7 7 - 7 0 0 0 LA QCINTA, CALIFORNIA 92253 FAX (760) 777-7101 December 4, 2012 To the Honorable Mayor, Members of the Governing Council, and Citizens of the City of La Quinta, California Government Code Section 26909 (a) requires that the City, as a local agency of the County, contract with a certified public accountant to perform an annual audit of the accounts and records of the City and that the audit conform to generally accepted auditing standards. Furthermore, Government Code Section 26909 (b) states that an audit report shall be filed with the State Controller and with the County Auditor of the County in which the district is located within 12 months of the end of the fiscal year. This report is published to fulfill these requirements foi the fiscal year ended June 30, 2012. In addition, City Ordinance 2.12.040 requires an annual audit be performed by a certified public accountant. Management assumes full responsibility for the completeness and reliability of the information contained in this report, based upon a comprehensive framework of internal control that it has established for this purpose. Because the cost of internal control should not exceed anticipated benefits, 1he objective is to provide reasonable, rather than absolute, assurance that the financial statements are free of any material misstatements. Lance Sall & Lunghard LLP Certified Public Accountants have issued an unqualified ("clean") opinion on the City of La Quinta financial statements for the year ended June 30, 2012. The independent auditor's report i8 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 introduction, overview, and analysis of the basic financial statements. The MD&A complements the letter of transmittal and should be read in conjunction with it. % 116 Profile of the Government The City of La Quinta is located 120 miles east of Los Angeles in the eastern portion of Riverside County known as the Coachella Valley. The City motto is "The Gem of the Desert." The City is governed by a five -member City Council under the Council/Manager form of government. The Mayor is directly elected by the citizens. The Mayor serves a two-year term and the four Council Members serve four-year terms, with two Council Members elected every two years. The Mayor and four Council Members are elected at large. The City was originally incorporated in 1982 as a general law City and it became a charter City in November 1996. The Council appoints the City Manager, who in turn appoints the Assistant City Managers and the heads of the various departments. The City of La Quinta provides a range of services which include: construction and maintenance of streets and other infrastructure; community development and planning; construction and code compliance; various recreational and cultural activities; and general municipal services. Services are also provided to the City and its citizens by contract and by the direct services of other government agencies and organizations. These services include police and fire protection through the County of Riverside, library services through the County of Riverside, visitor and tourist information through Greater Palm Springs Convention and Visitors Bureau, city promotion through the La Quinta Chamber of Commerce, water and sewer service through the Coachella Valley Water District, electricity service through the Imperial Irrigation District, refuse collection through Burrtec Waste Industries, public transit through Sunline Transit Agency, and cable service through Time Warner and Verizon. The City of La Quinta is also financially accountable for a legally separate Successor Agency for the former Redevelopment Agency, Financing Authority, and Housing Authority. Additional information on these legally separate entities can be found in the notes to the financial statements. Pursuant to City Ordinance 2.08.060 and 2.12.030, the City Manager and Finance Director are responsible for the preparation of the annual budget for City Council consideration prior to the start of the fiscal year. The annual budget serves as the foundation for the City of La Quinta's financial planning and control. The budget is prepared by fund, function, department and line item. Department heads may transfer line item resources within a division with the approval of the City Manager. Transfers between divisions and departments also need approval from the City Manager. 117 Local economy According to the State of California Economic Development Department (EDD), as of June 2012, the total workforce for the City of La Quinta was 15,100 of which 14,100 were employed for a 6.62% unemployment rate. This rate is significantly lower than the Riverside County unemployment rate of 12.6% and the statewide unemployment rate of 10.7%. During the last ten years, the City of La Quinta has been in a growth phase with net assessed values increasing from $4.61 billion in Fiscal Year 2002-03 to $10.38 billion in 2011-12. It should be noted; however, that the net taxable values in the past three fiscal years have consistently decreased by 5.31% in 2009-10, 7.48% in 2010-11, and 4.95% in 2011-12. The major increase in assessed values over .the past decade consists primarily of residential development; however, major commercial development has occurred along the Highway 111 corridor during this time. The City of La Quinta has transformed itself from a retirement community known as the "Gem of the Desert" and the western home of golf to a year-round full -service community. Major employers include the La Quinta Resort and Club, Desert Sands Unified School District, Wal-Mart Super Center, Home Depot, Hideaway, Lowe's Home Improvement and Tradition Golf Club. During the past ten years, the City of La Quinta general fund expenditures have increased 209%. Two Departments that have exceeded the average include and Public Safety (239%) and Community Services (258%). In the case of Public Safety, much of the increase is reflected in increased police service personnel. In the case of Community Services, much of the increase can be attributed to adding library and museum services and park maintenance functions to the Department. During the same ten-year period, the City of La Quinta general fund revenues increased 143%. Sources that exceeded the average include intergovernmental (189%), and taxes (184%). In the case of intergovernmental revenues, most of the increase is attributable to the way the fire service contract is accounted for and an increase in motor vehicle fees. In the case of taxes, the increase is due greatly to the increase in sales tax revenues from the commercial development along Highway 111. While the City has experienced record setting growth in the past decade, the recession of Fiscal Year 2008-11 has impacted the City of La Quinta. This downturn has resulted in our residents and businesses experiencing: (1) a higher level of unemployment, (2) lower property values; (3) more commercial store closings and (4) more home foreclosures than in previous years. In addition, the credit crisis has resulted in fewer 118 new home starts and new businesses delaying their plans to open stores in the City. While the City is the home of large and small retailers and hotels, no significant store openings have occurred in Fiscal Year 2011-12 and several large retailers have closed their doors in recent years. The City has experienced a modest increase in sales tax and transient occupancy tax in Fiscal Year 2011-12 versus Fiscal Year 2010-11; however, property tax collections still continue to decline in Fiscal Year 2012-13 from the historic highs of Fiscal Year 2006-07. While economists may state that the recession is over, future revenue declines in Fiscal Year 2011-12 and beyond may be on the horizon given the possible continued decline in property tax assessments. Since Fiscal Year 2008-2009, the City has tightened its fiscal belt at its mid year reviews and will have to continue to monitor and possibly further reduce expenditures in Fiscal Year 2012-13 given the revenue shortfalls that may continue to occur. This is evidenced by the reduction in staff levels from 105 positions budgeted for in Fiscal Year 2008-09 to 101 positions in Fiscal Year 2009-10 and a further reduction to 99 positions in Fiscal Year 2010-11and 89 positions in 2011-12. With the dissolution of the Redevelopment Agency in June 2011, staffing levels will continue to be monitored in the future. Long-term financial planning Each year the City embarks on a strategic planning process which begins in the spring with a discussion of the City Council goals and ends with adoption of the budget in June. The documents that are generated in this strategic planning process include a presentation of the financial achievements for the past fiscal year, a five-year cash flow projection for each City, Housing Authority and Financing Authority fund, and a financial management strategies and recommendation report for the coming fiscal year. Within the financial strategies and recommendation report, a "build out' analysis is included which estimates the annual General Fund revenue (inflows) and expenditures (outflows) in thirty years. This build out analysis is updated every three years based upon future land use designations, existing land use and population projections. This build out report projects that in twenty (20) years, with an estimated population of 81,771 versus the current 38,075, the annual revenues into the General Fund will be $3,276,000 less than expenditures. With this information provided during the mid -year financial review, the City of La Quinta is attempting to attract revenue -producing businesses and hotels consistent with its land use planning, while at the same time providing current and future residents a level of service that makes them proud to call La Quinta their home. iv 119 During Fiscal Year 2011-12, the General Fund balance decreased by $1,205,473 consisting of revenue decreases mainly in the interest income category. The decrease in interest income is due to historically low interest rates and the repayment of the Redevelopment Agency loans in the prior year. The General Fund balance as of June 30, 2012 was $91.9 million of which $23.9 million versus $23.7 million in Fiscal Year 2010-11 was nonspendable, $19.0 million versus $19.3 million in Fiscal Year 2010-11 was committed, $1.7 million versus $1.8 in Fiscal Year 2010-11 was assigned, and $47.1 million versus $48.1 million in Fiscal Year 2010- 11 was unassigned. The unassigned fund balances include a cash flow reserve of 8.25% of the annual budget and a $6.3 million future operational deficit reserve. Additional components of the strategic planning process include the Economic Development Plan, the Capital Improvement Program, the Annual Budget and the Five - Year Resource Allocation Plan. An explanation of each of these documents is provided below. Economic Development Plan This plan outlines a vision and direction for the City's economic development activities. It presents the mission statement, implementation policies, projected resources, and business plan the City will follow to sustain a comprehensive economic development effort. It is goal -oriented in that the economic development efforts specified in the plan are a key to generating the financial resources necessary to support both the Resource Allocation Plan and the Capital Improvement Plan. Capital Improvement Plan This plan is primarily a planning document that establishes five-year funding priorities for capital improvements. This plan also includes a listing of all the other desired capital improvements that cannot, or need not, be funded within the five-year horizon and totaled $123.4 million. Five -Year Resource Allocation Plan This plan is primarily a planning document that provides a five-year horizon for forecasted operational needs of each department, as well as the City as a whole. This plan is a cyclical review of all operations expenditures to reassess funding mechanisms behind personnel responsibilities and the various service levels of all programs. Annual Budget This document is the annual implementation tool for the overall planning process. The budget will encompass each element of the strategic planning effort and will implement: the goals of the Economic Development Plan; the resource and demand allocation outlined in the Five -Year Resource Allocation Plan; and the capital improvement investment for a given year. 120 Relevant Financial Policies On December 29, 2011, the California Supreme Court upheld Assembly Bill 1x26 that provides for the dissolution of all redevelopment agencies in the State of California. This action impacted the reporting entity of the City of La Quinta that previously had reported a redevelopment agency within the reporting entity of the City as a blended component unit. This action also deeply impacted the City's ability to continue an economic development program as the majority of funds used for capital improvements in the City came from funds of the Redevelopment Agency. Major Initiatives Despite the dissolution of the La Quinta Redevelopment Agency, projects that meet certain criteria can continue to completion. The City is currently working on two projects. The Washington Street Apartment Project to rehabilitate a 73-unit affordable rental housing project is underway and is scheduled to be completed by the summer of 2015. In addition, the Agency had purchased land near the southeast corner of Highway 111 and Dune Palms Road prior to the La Quinta Redevelopment Agency dissolution to construct additional affordable Apartment units. Construction on this project known as Coral Mountain will begin in September 2012. The City has begun construction on the Adams Street Bridge which will span the Whitewater Channel and provide an all-weather crossing at this location. The City has acquired a 525-acre parcel at Avenue 52 and Jefferson Street for the development of two golf courses, a clubhouse, and future hotel resort development. The first golf course was dedicated in January 2005. The second course, permanent clubhouse, and infrastructure have not proceeded as planned and remain in the planning stages due to the slow down in the economy. The Agency continues to seek quality development opportunities for future hotel(s) on the property to generate additional General Fund revenues. Awards and Acknowledgements The Government Finance Officers Association of the United States and Canada (GFOA) awarded a Certificate of Achievement for Excellence in Financial Reporting to the City of La Quinta for its comprehensive annual financial report (CAFR) for the fiscal year ended June 30, 2011. This was the sixteenth consecutive year that the City has received this prestigious award. In order to be awarded a Certificate of Achievement, the government had to publish an easily readable and efficiently vi 121 organized comprehensive annual financial report. This report must satisfy both generally accepted accounting principles and applicable legal requirements. A Certificate of Achievement is valid for a period of one year only. We believe that our current CAFR continues to meet the Certificate of Achievement Program's requirements and we are submitting it to the GFOA to determine its eligibility for another certificate. The preparation of this report would not have been possible without the efficient and dedicated service of the finance department staff. Credit also must be given to the Mayor and City Council for their support in maintaining the highest standards of professionalism in the management of the City of la Quinta's finances. Respectfully submitted, Robbeyn Bird, CPA Finance Director Vii 1-2 2 City of La Quinta Directory of Officials June 30, 2012 CITY COUNCIL Don Adolph, Mayor Terry Henderson, Mayor Pro Tern Linda Evans, Council Member Kristy Franklin, Council Member Lee Osborne, Council Member ADMINISTRATION Frank J. Spevacek, City Manager Robbeyn Bird, Finance Director Greg Butler, Building & Safety Director Edie Hylton, Community Services Director Kathy Jenson, City Attorney Les Johnson, Planning Director Tim Jonasson, Public Works Director/City Engineer Susan Maysels, City Clerk Y 123 VIII v }P PAH d§\j/ /§9! t\! . \\\ Sayw!\ _ ., /\\//2/E U § E - \/% !! 4 :j2 _ ! #/ _aGSM \ -MmYw "EmE l; f !|� ! \/\ M ! j !``|||)! / ; G \ /_ / \ §180im.\#hb _. . . ! \s\\§\\/\]/\ 4 . �®, 124 Certificate of Achievement for Excellence in Financial Reporting Presented to City of La Quinta California For its Comprehensive Animal Financial Report for the Fiscal Year Ended June 30, 2011 A Certificate of Achievement for Excellence in Financial Reporting is presented by the Government Finance Officers Association of the United States and Canada to government units and public employee retirement systems whose comprehensive annual financial reports (CAFRs) achieve the highest standards in government accounting and financial reporting. President �Oe 44-5PI Executive Director 12 LSEGoo Goo CERTIFIED PUBLIC ACCOUNTANTS • Brandon W. Burrows, CPA • David E. Hale, CPA, CFP A Professional Corpomnion • Donald G. Slater, CPA • Richard K. Kikuchi, CPA • Susan F. Matz, CPA • Shely K. Jackley, CPA • Bryan S. Gruber, CPA • Deborah A. Harper, CPA INDEPENDENT AUDITORS' REPORT To the Honorable Mayor and Members of City Council City of La Quinta, California We have audited the accompanying financial statements of the governmental activities, the business -type activities, each major fund, and the aggregate remaining fund information of the City of La Quinta, California, as of and for the year ended June 30, 2012, which collectively comprise the City's basic financial statements as listed in the table of contents. These financial statements are the responsibility of City of La Quints, California's management. Our responsibility is to express opinions on these financial statements based on our audit. We conducted our audit in accordance with auditing standards generally accepted in the United States of America and the standards applicable to financial audits contained in Government Auditing Standards, issued by the Comptroller General of the United States. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts .and disclosures in the financial statements. An audit also includes assessing the accounting principles used and the significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audit provides a reasonable basis for our opinion. In our opinion, the financial statements referred to above present fairly, in all material respects, the respective financial position of the governmental activities, the business -type activities, each major fund, and the aggregate remaining fund information of the City of La Quinta, California, as of June 30, 2012, and the respective changes in financial position, and cash flows, where applicable, thereof and the respective budgetary comparison for the General Fund and Housing Authority Project Area No. 2 for the year then ended in conformity with accounting principles generally accepted in the United States of America. In accordance with Government Auditing Standards, we have also issued our report dated November 16, 2012, on our consideration of the City of La Quints, California's internal control over financial reporting and on our tests of its compliance with certain provisions of laws, regulations, contracts, and grant agreements and other matters. The purpose of that report is to describe the scope of our testing of internal control over financial reporting and compliance and the results of that testing, and not to provide an opinion on internal control over financial reporting or on compliance. That report is an integral part of an audit performed in accordance with Government Auditing Standards and should be considered in assessing the results of our audit. We would like to draw the reader's attention to Note 23 — "Successor Agency Trust for Assets of the Former Redevelopment Agency". The note provides information on the dissolution of the Redevelopment Agency and the new formed Successor Agency. Lance, Sell & Lunghard, LLP 203 North Brea Boulevard • Suite 203 • Brea, CA 92821 TEL: 714.672.0022 • Fax: 714.672.0331 www.lsrcpas.com Orange County • Temecula Valley • Silicon Valley 126 ®00 SE Goo 0 0 CERTIFIED YWIIC ACCOYNTANTB To the Honorable Mayor and Members of City Council City of La Quinta, California Accounting principles generally accepted in the United States of America require that the management's discussion and analysis as listed in the table of contents be presented to supplement the basic financial statements. Such information, although not a part of the basic financial statements, is required by the Governmental Accounting Standards Board, who considers it to be an essential part of financial reporting for placing the basic financial statements in an appropriate operational, economic, or historical context. We have applied certain limited procedures to the required supplementary information in accordance with auditing standards generally accepted in the United States of America, which consisted of inquiries of management about the methods of preparing the information and comparing the information for consistency with management's responses to our inquiries, the basic financial statements, and other knowledge we obtained during our audit of the basic financial statements. We do not express an opinion or provide any assurance on the information because the limited procedures do not provide us with sufficient evidence to express an opinion or provide any assurance. Our audit was conducted for the purpose of forming an opinion on the financial statements that collectively comprise the City of La Quinta, California's financial statements as a whole. The introductory section and combining and individual nonmajor fund financial statements, budgetary comparison schedules, and statistical section, are presented for purposes of additional analysis and are not a required part of the financial statements. The combining and individual nonmajor fund financial statements and budgetary comparison schedules are the responsibility of management and were derived from and relate directly to the underlying accounting and other records used to prepare the financial statements. The information has been subjected to the auditing procedures applied in the audit of the financial statements and certain additional procedures, including comparing and reconciling such information directly to the underlying accounting and other records used to prepare the financial statements or to the financial statements themselves, and other additional procedures in accordance with auditing standards generally accepted in the United States of America. In our opinion, the information is fairly stated in all material respects in relation to the financial statements as a whole. The introductory and statistical sections has 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. Brea, California November 16, 2012 127 2 Management's Discussion and Analysis As management of the City of La Quinta, we offer readers of the City of La Quinta's financial statements this narrative, overview and analysis of the financial activities for the fiscal year ended June 30, 2012. We encourage readers to consider the information presented here in conjunction with additional information that we have furnished in our letter of transmittal, which can be found in an earlier section of this report. All amounts, unless otherwise indicated, are rounded to the nearest thousands of dollars. Financial Highlights The assets of the City of La Quinta exceeded its liabilities at the close of the most recent fiscal year by $688,166,000 (net assets). Of this amount, $85,087,000 (unrestricted net assets) may be used to meet the government's ongoing obligations to citizens and creditors. Approximately $576,494,000 or 84 percent was invested in capital assets net of related debt and is not available to meet ongoing obligations. The governmental activities total net assets increased by $169,967,000 and the Business -Type total net assets decreased by $212,000 attributable to the SilverRock Golf Course. Of the $169,755,000, the extraordinary gain on the dissolution of the Redevelopment Agency represented $158,655,000. This extraordinary gain is explained more extensively in this document in Note 23. As of the close of the current fiscal year, the City of La Quinta's governmental funds reported combined ending fund balances of $107,132,000 a decrease of $86,239,000 in comparison with the prior year. The primary reason for this decrease is due to the dissolution of the Redevelopment Agency which resulted in the need to eliminate or postpone capital projects funded with tax increment funds. • At the end of the current fiscal year, the unassigned General Fund Balance comprised $47,738,000 of the total $91,876,000 General Fund Balance or 52 percent of the total Fund Balance and 131 percent of total General Fund budgeted expenditures. • The total debt decreased by $253,429,000 during the current fiscal year from $258,976,000 to $5,547,000. This decrease is mainly due to transfer of the Redevelopment Agency bonded indebtedness to the Successor Agency due to dissolution of the Redevelopment Agency. 128 Overview of the Financial Statements This discussion and analysis is intended to serve as an introduction to the City of La Quinta's basic financial statements. The City of La Quinta's basic financial statements comprise three components: 1) government -wide financial statements, 2) fund financial statements, and 3) notes to the financial statements. This report also contains other supplementary information in addition to the basic financial statements themselves. Government -wide financial statements The government -wide financial statements are designed to provide readers with a broad overview of the City of La Quinta's finances, in a manner similar to a private -sector business. The statement of net assets presents information on all of the City of La Quinta's assets and liabilities, with the difference between the two reported as net assets. Over time, increases or decreases in net assets may serve as a useful indicator of whether the financial position of the City of La Quinta is improving or deteriorating. The statement of activities presents information showing how the government's net assets changed during the most recent fiscal year. All changes in net assets are reported as soon as the underlying event giving rise to the change occurs, regardless of the timing of related cash flows. Thus, revenues and expenses are reported in this statement for some items that will only result in cash flows in future fiscal periods (e.g., earned but unused vacation leave). Both of the government -wide financial statements mentioned above distinguish functions of the City of La Quinta that are principally supported by taxes and intergovernmental revenues (governmental activities) from other functions that are intended to recover all or a significant portion of their costs through user fees and charges (business -type activities). The governmental activities of the City of La Quinta include general government, public safety, community services, planning and development and public works. The business -type activities of the City of La Quinta include the SilverRock Golf course operations. The government -wide financial statements include not only the City of La Quinta itself (known as the primary government), but also the La Quinta Financing Authority and the La Quinta Housing Authority. Although legally separate entities they function for all practical purposes as departments of the City of La Quinta, and therefore have been included as an integral part of the primary government. The government -wide financial statements can be found in the table of contents under the Financial Section of this report. 129 4 Fund financial statements A fund is a grouping of related accounts that is used to maintain control over resources that have been segregated for specific activities or objectives. The City of La Quinta, like other state and local governments, uses fund accounting to ensure and demonstrate compliance with finance -related legal requirements. All of the funds of the City of La Quinta can be divided into three categories: governmental funds, proprietary funds, and fiduciary funds. Governmental funds Governmental funds are used to account for essentially the same functions reported as governmental activities in the government -wide financial statements. However, unlike the government -wide financial statements, governmental fund financial statements focus on near -term inflows and outflows of spendable resources, as well as on balances of spendable resources available at the end of the fiscal year. Such information may be useful in evaluating a government's near -term financing requirements. Because the focus of governmental funds is narrower than that of the government -wide financial statements, it is useful to compare the information presented for governmental funds with similar information presented for governmental activities in the government - wide financial statements. By doing so, readers may better understand the long-term impact of the government's near -term financing decisions. Both the governmental fund balance sheet and the governmental fund statement of revenues, expenditures, and changes in fund balances provide a reconciliation to facilitate this comparison between governmental funds and governmental activities. The City of La Quinta maintains thirty five (35) individual governmental funds, which are distinguished between major and non -major funds. Information is presented separately in the governmental fund balance sheet and in the governmental fund statement of revenues, expenditures, and changes in fund balances for the general fund, two (2) debt service funds and three (3) capital project funds, and one (1) special revenue fund. These seven (7) funds are considered to be major funds. Data from the other twenty-eight (28) governmental funds are combined into a single, aggregated presentation. Individual fund data for each of these non -major governmental funds is provided in the form of combining statements elsewhere in this report. The City of La Quinta adopts an annual appropriated budget for its general fund. A budgetary comparison statement has been provided for the general fund to demonstrate compliance with this budget. The basic governmental fund financial statements can be found in the table of contents under the heading Basic Financial Statements. 130 Proprietary funds Proprietary funds can be broken down into enterprise and internal service funds. The City of La Quinta maintains one (1) enterprise fund. Enterprise funds are used to report the same functions presented as business -type activities in the government -wide financial statements. The City of La Quinta uses an enterprise fund to account for its SilverRock Golf Course operations, which is considered to be a major fund. Internal service funds are an accounting device used to accumulate and allocate costs internally among the City of La Quinta's various functions. The City of La Quinta has three (3) internal service funds to account for its major equipment replacement including vehicles, for its information technology systems, and for its park equipment and facility needs. Because these three services predominantly benefit governmental rather than business - type functions, they have been included within governmental activities in the government -wide financial statements. The internal service funds are combined into a single, aggregated presentation in the proprietary fund financial statements. Individual fund data for the internal service funds is provided in the form of combining statements elsewhere in this report The basic proprietary fund financial statements can be found on the pages listed in the table of contents for Proprietary Funds: Statement of Net Assets, Statement of Revenues, Expenses and Changes in Net Assets, and Statement of Cash Flows. Fiduciary funds Fiduciary funds, also called agency funds, are used to account for resources held for the benefit of parties outside the government. Fiduciary funds are not reflected in the government -wide financial statements because the resources of those funds are not available to support the City of La Quinta'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 the pages listed in the table of contents for Fiduciary Funds: Statement of Fiduciary Assets and Liabilities Agency Funds. Notes to the financial statements The notes to the financial statements provide additional information that is essential to a full understanding of the data provided in the government -wide and fund financial statements. The notes to the financial statements can be found on the pages listed in the table of contents for Notes to the Basic Financial Statements. Other information In addition to the basic financial statements and accompanying notes, presents certain required supplementary information concerning La Quinta's General Fund and its budget appropriations. Required this report also the City of supplementary 131 information can be found in the table of contents under the section Required supplemental Information and includes Notes to the Required Supplementary Information and a General Fund Budgetary Comparison Schedule. The combining statements referred to earlier in connection with non -major governmental funds, internal service funds, and agency funds are presented immediately following the required supplementary information. Combining and individual fund statements and schedules can be found in the table of contents under Supplementary Schedules. Government -wide financial analysis As noted earlier, net assets may serve over time as a useful indicator of a government's financial position. In the case of the City of La Quinta, assets exceeded liabilities by $688,166,000 at the close of the most recent fiscal year, which is $169,755,000 more than the previous year. The largest portion of the City of La Quinta's net assets, which was 84% this year and 61% last year, reflects its investment in capital assets (e.g., land, buildings; machinery, and equipment); less any related debt used to acquire those assets that is still outstanding. The City of La Quinta uses these capital assets to provide services to citizens; consequently, these assets are not available for future spending. Although the City of La Quinta's investment in its capital assets is reported net of related debt, it should be noted that the resources needed to repay this debt must be.provided from other sources, since the capital assets themselves cannot be used to liquidate these liabilities. City of La Quinta Net Assets Governmental activities Business -type activities Total _ 2012 2011 2012 2011 2012 2011 Current and other assets $137,676,930 $224,830,553 $ (4,535,584) $(4,676,580) $133,141,346 $220,153,973 Capital assets 534,388,479 530,713,522 42,274,767 42,777,148 576,663,246 573,490,670 Total assets 672,065,409 755,544,075 37,739,183 38 100,568 709,804,592 793,644,643 Current liabilities 15,880,753 17,142,272 210,308 242,371 16,091,061 17,384,643 Non -current liabilities 5,377,984 257,562,497 169,084 286,097 5,547,068 257,848,594 Total liabilities 21,258,737 274,704,769 379,392 528,468 21,638,129 275,233,237 Net assets: Invested in capital assets, net of related debt 534,388,479 276,787,752 42,105,683 42,491,051 576,494,162 319,278,803 Restricted 26,585,382 107,042,126 26,585,382 107,042,126 Unrestricted 89,832,811 97,009,428 4,745,892 4,918,951 85,086,919 92,090,477 Total net assets $650,806,672 $480,839,306 $ 37,359,791 $37,572,100 $688,166,463 $518,411,406 132 An additional portion of the City of La Quinta's net assets (4 percent versus 21 percent in the prior year) represents resources that are subject to external restrictions on how they may be used. The remaining balance of unrestricted net assets - $85,087,000 (12 percent) may be used to meet the government's ongoing obligations to citizens and creditors. At the end of the current fiscal year, the City of La Quinta is able to report positive balances in all three categories of net assets, both for the government as a whole, as well as for its separate governmental activities; however, the business type unrestricted net assets had a deficit of $4,746,000, which is approximately $200,000 less than the previous year. Governmental activities Governmental activities net assets decreased by $169,967,000 accounting for a 35 percent change in the net assets from the previous year. Key elements of these changes are as follows: City of La Quinta Changes in Net Assets Golemmemal Busines"pe Actidties Acthities Total 2012 2011 Chan 2012 2011 Change 2012 2011 Chance Relenues: Program muenues: Charges for servo. $ 2,504,302 $ 2,463.488 $ 40,814 $ 3,871.898 $ 3,7%,615 $ 115,283 $ 6,376,2M $ 6,220,103 $ 156,M7 operating grants and ..town.. 11,289,6n 13J52.9Al2 (1,863,269) - - - 11,289,673 13,152,942 (1,863,269) Capital grants and cemdbutions 9,9%,793 3,157,828 6,832,%5 - - - 9,990,793 3,157,828 6,832,%5 Generel revenues: Pmperly taxes 21,370.476 5,942,353 15,428,423 - - - 21,370.476 5,942,353 15.428,123 Othertaxes 15,570,619 46,%1,932 (31,391.313) - - - 15.570,619 46,961,932 (31.391,313) Investment intone 1,925,255 4,693.974 (2,768,719) 1,075 2,125 (1,050) 1,926.330 4,6%,099 (2,769,769) Moo vebicle in lieu 3.173.826 3,515,395 (M1,569) - - - 3,173,826 3,515,395 (M1,569) ExtaeNinary gain (loss) on dissolution of Redelelopmenl Agency 158,654,715 - 158,654.715 - - - 158,654,715 - 158,6M,715 Miscellaneous 268,6N 3,211584 2,942,940 268614 3,211,SM 2,942,940 $ 224,748 303 $ B3 o99 4% It 141,648 807 S 3,872,973 S 3.758,740 $ 114 233 5 228.621.276 $ 86.858.2M $ 141 763 NO Total revenues Expenses: Geneal govemment $ G,1W,712 $ 11,283,358 $ (5,099,646) S - $ - $ - $ 6,183,712 $ 11,283,358 $ (5,099,646) Pudic safety 20,815,454 21.070,458 (255,001) - - - 20,815,4M 21,070,458 (255,1XM1) Planning and development 6,378.M2 18.715,283 (12,336,%1) - - - 6,379,352 18,715,283 (12,33Q%1) Community seruces 5,M.402 4,73Q964 357,438 - - 5,093,402 4,735,964 357,4M Pudic woks 13,288,521 10,757,279 2,631.242 - - - 13.288,521 10,757,279 2.531.242 Capital coddbutione Interest on Iong-term debt - 3,021,4% 31,324,064 14,353,359 (31,324.064) (I I'M1,863) - - - - - - - 3,021.4% 31,324,%4 14,3 .Mt) (31,324,064) (11,331.11M) Golf couae 4,085,282 4,202 274 116,992 $ 54,780,07 $ 112M9,765 E 57458828 $ 4',085,282 S 4,202,274 E (116.9921 S 5I.780,%7 $112,239,765 $ 57.450,828 Total expenses Increase in net assets before transfers and contributions $ 169,%7.Mi $ (29,140,269) $ 199,107,635 $ (212,3M) $ (443,5M) E 231.225 $ 173.M.339 $ (25.381,529) $ 199,221,868 Tiansrers - - - - - - - - - Contributions - - - - - - - Rastatements - - - - - - - - Decrease in no assets 169,%7,%6 (29,W,269) 199.107,635 (212,309) (443,SM) 231,225 173,840,339 (25,381,529) 199,221,868 NN assets - 7/1/11 480 838 306 M9.979.575(29,14D,269) 37572,100 38,015 6M 443 5M 518.411,406 547,995,209 29 WI 803 $ 65ge%,672 $ 480 839 3% $ 169 %7,366 $ 37.359.791 $ 37.572.100 5 212,309 5 W8 1% 463 $ 518,411.406 $ 169 755,057 Net assess - 6/3d12 8 133 Revenues increased by $141,763,000 with the largest category increases of $158,655,000 in the extraordinary gain on dissolution of the Redevelopment Agency and property taxes of $15,428,000. The increases in revenues were partially offset by a decrease in other taxes of $31,391,000. The major reason for the net decrease in taxes is due to the loss of tax increment as a result of the dissolution of the redevelopment agency. The overall increase in total revenues is also primarily due to the redevelopment agency dissolution which resulted in an extraordinary gain in the current year. Expenses decreased by $57,459,000 with the two largest category changes being a decrease in the interest on long-term debt category of $11,332,000 and a decrease in the Capital contributions category of $31,324,000. The decrease in the interest on long-term debt category is primarily the result of the repayment of the loans between the City and the former Redevelopment Agency resulting in less interest income in the current year. The decrease in the Capital Contributions costs is primarily the result of the dedication of the Wolff Waters Place Apartments project to the Coachella Valley Housing Coalition ($30,148,000) in the previous fiscal year. • There were no contributions in assets from the governmental activities to the business -type activities. 134 Business -type activities This was the seventh full year of operations for the SilverRock Golf fund since the golf course began early operation in 2005. Net assets decreased by $ (212,000) from the effects of an operating loss. Charges for services primarily consisted of green fees which totaled $3,872,000, and was $113,000 more than the previous year, with golf course expenses of $4,085,000, which was $117,000 less than the previous year. During Fiscal Year 2011-12, no additional advances were required for the golf course operations. The total outstanding advance due to the General Fund from the inception of the Golf Course opening is $5,313,000. It is anticipated that these advances will be repaid from future income from SilverRock activities such as transient occupancy tax, sales tax and golf course net income generated on the site in future years. Financial Analysis of the Government's Funds As noted earlier, the City of La Quinta uses fund accounting to ensure and demonstrate compliance with finance -related legal requirements. Governmental funds - The focus of the City of La Quinta's governmental funds is to provide information on near -term inflows, outflows, and balances of fund balances. Such information is useful in assessing the City of La Quinta's financing requirements. In particular, unreserved fund balance may serve as a useful measure of a government's net resources available for spending at the end of the fiscal year. 10 '.'': 135 As of the end of the current fiscal year, the City of La Quinta's governmental funds reported combined ending fund balances of $107.13 million as follows: Governmental Fund Balances Category General Fund Percent All Other Funds Percen Total Funds Percent Nonspendable $23,883,926 26% $2,092,086 14% $25,976,012 24% Restricted 173,426 0% 26,411,956 173% 26,585,382 25% Committed 19,039,696 21% - 0% 19,039,696 18% Assigned 1,041,172 1% 0% 1,041,172 1% Unassigned 47,737,861 52% (13,248,593) -87% 34,489,268 32% Total $91,876,081 $15,255,449 $107,131,530 Governmental fund balances ended the year totaling $107,132,000, a decrease of $86,239,000 in comparison with the prior years ending balance of $193,371,000. Of this amount $25,976,000 or 24% constitutes nonspendable reserves, which means that these reserves are not available to fund operating expenditures of the organization, $26,585,000 or 25% are restricted fund balances which are the result of external limitations on spending, $19,040,000 or 18% are committed fund balances with has resulted in self-imposed limitations placed upon the funds by the Governing Board responsible for adopting the fund budget, assigned reserves of $1,042,000 consist of carryover appropriations which were budgeted for in Fiscal Year 2011-12, but were unspent and will be budgeted again in the next budget year. The remainder of fund balance or $34,489,000 million represents unassigned fund balances or the residual net resources after taking into consideration the other classifications. General Fund The general fund is the chief operating fund of the City of La Quinta. At the end of the current fiscal year, unassigned fund balance of the general fund was $47,738,000, while total fund balance reached $91,876,000. As a measure of the general fund's liquidity, it may be useful to compare the total general fund balance to budgeted expenditures (including transfers out). The total fund balance represents 255 percent of the total budgeted expenditures. The City of La Quinta's general fund balance decreased by $1,205,000 in Fiscal Year 2011-2012. Key factors for this increase are as follows: Actual expenditures were $2,770,000 less than the final budget. Divisions that were significantly under budget for the year were Police ($804,000), Fire ($463,000), Street Maintenance ($577,000), Legislative ($162,000) and Capital outlay ($97,000). In addition, actual transfers out were $148,000 less than budgeted. Actual revenue collections were $112,000 more than the final adjusted budget. Overall, taxes were $867,000 more than budgeted for in Fiscal Year 2011-12, and the actual taxes collected in Fiscal Year 2011-12 ($21,296,300) was $974,000 more the prior year tax actual collections of $20,322,000. Actual transient occupancy tax collections in Fiscal Year 2011-12 were $5,447,000 or $709,000 more than prior year collections. Actual sales tax collections for Fiscal Year 2011-2012 were $7,714,000 or $390,000 more than the $7,324,000 collected in Fiscal Year 2010-11. Interest income decreased $2,769,000 from the prior year due to a combination of historically low interest rates as well as repayment of the Redevelopment Agency loans. Motor vehicle in lieu taxes decreased from $3,515,000 in fiscal year 2010-11 to $3,174,000 in 2011-12. Housing Authority PA No. 2 Fund The Housing Authority fund is used to account for the housing activities of the Housing Authority in Project Area No. 2. The primary purpose of this fund is to promote and to provide quality housing in the City. The fund balance increased by $618,400 to end the year at $8.1 million. Capital Improvement Fund The fund is primarily used to record the expenditure of funds for capital projects. The fund had thirty nine (39) active Capital Improvement Projects budgeted for during Fiscal Year 2011-12. The three most active projects during the year were the Adams Street Bridge Improvements project ($2,603,000), A Street Extension ($1,461,000) and the Coral Mountain Apartments project ($3,909,000). Other major projects budgeted in the future include the Pavement Management and Slurry Seal Program, the Sports Complex Lighting Rehabilitation and Expansion project, and the Americans with Disabilities Act (ADA) Improvements for City owned properties. Civic Center Fund The fund is primarily used to collect developer impact fees for the construction of the City Hall expansion and the repayment of a portion of the debt service on the original City Hall construction. The City Hall expansion was completed in Fiscal Year 2007-08 and the final repayment of the original City Hall construction bonds is scheduled in Fiscal Year 2018-19. A $7.17 million advance from the General Fund is outstanding at the end of Fiscal Year 2011-12. Redevelopment Agency Project Area 1 & 2 Debt Service Funds The Redevelopment Agency Project Area 1 & 2 Debt Service Funds were used to accumulate resources, primarily property taxes, to pay debt service. With the dissolution of the Redevelopment Agency per Assembly Bill 1x26 effective February 1, 2012, the assets and activities of the dissolved redevelopment agency are reported in a fiduciary fund (private purpose trust fund) in the financial statements of the City. Therefore, the fund balances of these two funds is zero at June,30, 2012. 137 12 Proprietary funds The City of La Quinta's proprietary funds provide the same type of information found in the government -wide financial statements, but in more detail. The financial activities of the City enterprise fund have already been addressed in the discussion of the City of La Quinta's business -type activities. In addition, the City has three (3) internal service funds to accumulate resources for equipment and vehicle replacement, information technology activities, and for park equipment and facility replacement. General Fund Budgetary Highlights During the year there was a $1,390,000 increase in appropriations and transfers out between the original ($34,672,000) and final amended budget ($36,062,000). Following are the main components of the changes: • The FY 2011-12 budget included $1,041,000 in carryover appropriations from FY 2010-11. • The Fiscal Year included an additional $847,000 in appropriations for Capital Projects funded by the General Fund during the year. The budget increases were possible because of additional anticipated revenues and unassigned reserves and the carryover encumbrances and appropriations were possible from available net changes in fund balances. Capital Asset and Debt Administration Capital assets The City of La Quinta's investment in capital assets for its governmental and business - type activities as of June 30, 2012, amounts to $576,663,000 (net of accumulated depreciation). This investment in capital assets includes land, right of way, buildings and improvements, machinery and equipment, streets and bridges, and construction in progress. The investment in capital assets increased this fiscal year from the purchase of properties which exceeded the depreciation expenses. The following chart lists the asset categories for governmental and business like activities net of depreciation. .. 0 138 13 City of La Quinta Capital Assets (net of depreciation) Gmemmental Business -type Description Actiuties ActiNties Total 2012 2011 2012 2011 2012 2011 Land $ 69,628,685 $ 68,139,567 $36,840,832 $36,840,832 $ 106,469,617 $104,980,399 Building and Improvements 50,257,149 52,688,147 4,894,712 5,129,267 55,151,861 57,817,414 Equipment and fumiture 612,134 733,492 539,223 807,049 1,151,357 1,540,541 Vehicles 328,874 423,081 - - 328,874 423,081 software - - - - - - Infrastructure 398,368,091 396,78Z262 - - 398,368,091 396,782,262 Construction in Progress 15,193,546 11,946,973 - - 15,193,546 11,946,973 $ 534,388,479 $530,713,522 $42,274,767 $42,777,148 $ 576,663,246 $573,490,670 Total Major capital asset events during the current fiscal year included the following: Governmental activities Recording infrastructure improvements, including developer dedications of $1,586,000, to street improvements, street right of way, street sidewalks and curbs and gutters, traffic signals, and street medians; • Completed the Washington Street Storm Drain Improvements totaling $179,400; • Completed the La Quinta Sports Complex Rehabilitation in the amount of $919,500; • Completed the Traffic Signal and "A" Street Extension ($1,655,900); • Completed Highway 111 Median Island Landscape Improvements ($1,321,600); • Completed Eisenhower Drive and Calle Tampico Signal Interconnect ($460,000); and, • Purchased land for future development (11,815,000). Business -type activities • The Golf Course capital asset balance at June 30, 2012 was $42,275,000 net of accumulated depreciation. The entire decrease of $502,000 was due to annual depreciation of the assets. Additional information on the City of La Quinta's capital assets can be found in Footnote 6 to the financial statements. 14 139 Long-term debt At the end of the current fiscal year, the City of La Quinta had total bonded debt outstanding of $5,378,000. Of the total amount, $3,895,000 of this debt amount represents bonds secured solely by specified revenue sources (i.e., tax allocation bonds); while, $114,340,000 of the debt represents revenue bonds that will be paid from pledged tax increment property tax housing funds. In addition, $286,000 in capital equipment leases is outstanding in connection with SilverRock Golf Course and $78,000 in a copier lease is outstanding in the governmental funds. City of La Quinta Outstanding Debt Gmemmental Business -type Activities Activities Total 2012 2011 2012 2011 2012 2011 Debt type: Capital leases Compensated absences Post retirement healthcare liability $ 40,088 941,954 459,644 $ 78,252 965,921 337,311 $ 169,084 $ 286,097 $ - - - - 209,172 941,954 459,644 $ 364,349 966,921 337,311 General liability retrospective deposit Pass through agreement Due to government agencies Loans payable Tax allocation bonds 41,298 - - - - - 1,255,242 1,729,383 1,503,433 138,480,000 - - - - - - - - - - 41,298 - - - - - 1,255,242 1,729,383 1,503,433 138,480,000 Revenue bonds 3, 895, 000 114,340,000 - - 3,895,000 114,340,000 $ 5,377, 984 $258,689,542 $ 169,084 $ 286,097 $ 5,547,068 $258,976,639 Total The total outstanding debt decreased by $253,429,000 during Fiscal Year 2011-12. The decreases were almost entirely due to transfers to the Successor Agency of the former Redevelopment Agency of $245,287,000 and repayments of principal in the amount of $7,876,000. Additional information on the City of La Quinta's long-term debt can be found in notes 7, 8, and 22 of the financial statements. Economic Factors and Next Year's Budgets and Rates These factors were considered in preparing the City of La Quinta's budget for Fiscal Year 2012-2013: The City of La Quinta had a 6.6 versus 7.5 percent last year unemployment rate. This rate is significantly lower than the Riverside County and the State-wide unemployment rate. During the last ten years, the City of La Quinta has been in a growth phase with assessed values increasing from $3.77 billion in Fiscal Year 2001-2002 to $10.33 billion or over 274 percent. It is important to note however, that from Fiscal Year 2009-10 to Fiscal Year 2011-2012 assessed values decreased by $1.42 billion or 12.1%. 15 140 During the current fiscal year, the general fund net loss was $1,205,000 and $1,041,000 of General fund balance has been assigned for carry over appropriations. AB1x26 dissolved California Redevelopment Agencies as of January 31, 2012. Due to the loss of Tax Increment, the City's ability to fund future capital projects has been severely curtailed. The Fiscal Year 2012-13 General Fund revenue projections include anticipated increases for the City becoming a Transportation Uniform Mitigation Fee (TUMF) collecting organization ($412,500). The Fiscal Year 2012-13 budget includes Transient Occupancy Tax increases due to more focused and successful enforcement of vacation rentals in the community ($300,000). The City of La Quinta adopted a balanced general fund budget for Fiscal Year 2012-13, after applying $2,188,000 in unassigned reserves. Requests for Information This financial report is designed to provide a general overview of the City of La Quinta's finances for all those with an interest in the government's finances. Questions concerning any of the information provided in this report or requests for additional financial information should be addressed to the City of La Quinta, Robbeyn Bird, Finance Director, P.O. Box 1504, La Quinta, CA, 92247 or by telephone at 760-777-7150. ill CITY OF LA QUINTA STATEMENT OF NET ASSETS JUNE 30, 2012 Primary Government Governmental Business -Type Activities Activities Total Assets: Cash and investments $ 107,764,618 $ 435,601 $ 108,200,219 Receivables: Accounts 387,502 22,242 409,744 Taxes 2,415,712 - 2,415,712 Notes and loans 7,978,361 - 7,978,361 Accrued interest 72,776 128 72,904 Internal balances 5,313,025 (5,313,025) - Prepaid costs - 40,596 1,865 42,461 Deposits 132,116 250,000 382,116 Due from other governments 4,994,339 - 4,994,339 Inventories - 67,605 67,605 Land held for resale 8,320,000 - 8,320,000 Long-term retrospective refund 257,885 - 257,885 Capital assets not being depreciated 369,726,852 36,840,832 406,567,684 Capital assets, net of depreciation 164,661,627 5,433,935 170,095,562 Total Assets 672,065,409 37,739,183 709,804,592 Liabilities: Accounts payable 4,008,184 167,718 4,175,902 Accrued liabilities 651,568 2,217 653,785 Accrued interest 54,043 - 54,043 Unearned revenue 610,233 4,873 615,106 Deposits payable. 7,009,804 35,500 7,045,304 Due to other governments 3,546,921 - 3,546,921 Noncurrent liabilities: Due within one year 1,310,040 125,348 1,435,388 Due in more than one year 4,067,944 43,736 4,111,680 Total Liabilities 21,258,737 379,392 21,638,129 Net Assets: Invested in capital assets, net of related debt 534,388.479 42,105,683 576,494,162 Restricted for: Planning and development projects 10,767,199 - 10,767,199 Public safety 245,187 - 245,187 Public works 145,823 - 145,823 Capital projects 4,089,156 - 4,089,156 Debt service 175,960 - 175,960 Community services 11,162,057 - 11,162,057 Unrestricted 89,832,811 (4,745,892) 85,086,919 Total Net Assets $ 650,806,672 $ 37,359,791 $ 688,166,463 See Notes to Financial Statements 17 �,.^ 142 CITY OF LA OUINTA STATEMENT OF ACTIVITIES YEAR ENDED JUNE 30, 2012 Functions/Programs Primary Government: Governmental Activities: General government Public safety Planning and development Community services Public works Interest on long-term debt Total Governmental Activities Business -Type Activities: Golf Course Total Business -Type Activities Total Primary Government Program Revenues Operating Capital Charges for Contributions Contributions Expenses Services and Grants and Grants $ 6,183,712 $ 86,869 $ 340,375 $ 937,163 20,815,454 1,020,822 5,027,467 9,124 6,378,352 68,470 3,269,650 5,912,750 5,093,402 247,397 62,680 - 13,288,521 1,080,744 2,589,501 3,131,756 3,021,496 - - - 54,780,937 2,504,302 11,289,673 9,990,793 4,085,282 3,871,898 - - 4,085,282 3,871,898 - $ 58,866,219 $ 6,376,200 $ 11,289,673 $ 9,990,793 General Revenues: Taxes: Property taxes, levied for general purpose Transient occupancy taxes Sales taxes Franchise taxes Business licenses taxes Othertaxes Motor vehicle in lieu -unrestricted Use of money and property Other Extraordinary gain/(loss) on dissolution of redevelopment agency (Note 23) Total General Revenues, Contributions, Extraordinary Items and Transfers Change in Net Assets Net Assets at Beginning of Year Net Assets at End of Year See Notes to Financial Statements 18 Net (Expenses) Revenues and Changes in Net Assets Primary Government Governmental Business -Type Activities Activities Total $ (4,819,305) $ (14,758,041) 2,872,518 (4,783,325) (6,486,520) (3,021,496) (30,996,169) $ (4,819,305) (14,758,041) 2,872.518 (4,783,325) (6,486,520) (3,021,496) (30,996,169) (213,384) (213,384) (213,384) (213,384) (30,996,169) (213,384) (31,209,553) 21,370,476 - 21,370,476 5,446,883 - 5,446,883 7,713,741 - 7,713,741 1,687,440 - 1,687,440 293,592 - 293,592 428,963 - 428,963 3,173,826 - 3,173,826 1,925,255 1,075 1,926,330 268,644 - 268,644 158,654,715 158,654,715 200,963,535 1,075 200,964,610 169,967,366 (212,309) 169,755,057 480,839,306 37,572,100 518,411,406 $ 650,806,672 $ 37,359,791 $ 688,166,463 144 See Notes to Financial Statements - 19 CITY OF LA QUINTA BALANCE SHEET GOVERNMENTALFUNDS JUNE 30, 2012 Special Revenue Funds Capital Projects Funds Housing Authority PA No. Capital General 2 Improvement Civic Center Assets: Pooled cash and investments $ 75,834,824 $ 8,039,919 $ 1,161,731 $ Receivables: Accounts 36,121 37,958 - Taxes 2,415,712 - Long-term retrospective refund 257,885 - Notes and loans - 3,867,710 Accrued interest 66,003 - Prepaid costs 27,481 12,875 Deposits 118,516 13,600 - Due from other governments 4,658,301 - 115,632 Due from other funds 14,174 - - Advances to other funds 15,417,929 - Land held for resale 8,320,000 - Total Assets $ 107,166,946 $ 11,972,062 $ 1,277,363 $ Liabilities and Fund Balances: Liabilities: Accounts payable $ 3,616,971 $ 50 $ 371,080 $ Accrued liabilities 639,534 8,086 - Deferred revenues 4,743,978 3,867,710 272,713 Unearned revenues 24,699 - 231,798 Deposits payable 6,265,683 26,782 492,433 Due to other governments - - Due to other funds Advances from other funds - - - 7,169,490 Total Liabilities 15,290,865 3,902,628 1,368,024 7,169,490 Fund Balances: Nonspendable: Prepaid costs 27,481 12,875 - - Land held for resale 8,320,000 - Notes and loans - Advances to other funds 15,417,929 - Deposits 118,516 13,600 Restricted for: Planning and development projects - 8,042,959 Public safety - Community services - - Public works - - - Capital Projects - Debt service 173,426 - Committed to: Emergency reserve 17,516,295 - Post retirement health benefits 1,523,401 Assigned to: Continuing appropriations 1,041,172 47,737,861 - (90,661) (7,169,490) Unassigned Total Fund Balances 91,876,081 8,069,434 (90,661) (7,169,490) Total Liabilities and Fund Balances $ 107,166,946 $ 11,972,062 $ 1,277,363 $ See Notes to Financial Statements 20 Rwti. 14 5 J CITY OF LA QUINTA BALANCE SHEET GOVERNMENTALFUNDS JUNE 30, 2012 Debt Service Funds Other Total Redevelopment Redevelopment Governmental Governmental Agency PA No. 1 Agency PA No. 2 Funds Funds Assets: Pooled cash and investments $ - $ - $ 18,933,523 $ 103,969,997 Receivables: Accounts - 313,423 387,502 Taxes - - - 2,415,712 Long-term retrospective refund - - - 257,885 Notes and loans - - 4,110,651 7,978,361 Accrued interest - - 5,548 71,551 Prepaid costs -. - - 40,356 Deposits - - - 132,116 Due from other governments - - 220,406 4,994,339 Due from other funds - - - 14,174 Advances to other funds - - 15,417,929 Land held for resale - - - 8,320,000 Total Assets $ $ $ 23,583,551 $ 143,999,922 Liabilities and Fund Balances: Liabilities: Accounts payable $ - $ - $ 8,312 $ 3,996,413 Accrued liabilities - - - 647,620 Deferred revenues - - 2,053,922 10,938,323 Unearned revenues - - 353,736 610,233 Deposits payable - - 224,906 7,009,804 Due to other governments - - 3,546,921 3,546,921 Due to other funds - - 14,174 14,174 Advances from other funds - - 2,935,414 10,104,904 Total Liabilities 9,137,385 36,868,392 Fund Balances: Nonspendable: Prepaid costs - 40,356 Land held for resale - - - 8,320,000 Notes and loans - - 2,065,611 2,065,611 Advances to other funds - - - 15,417,929 Deposits - - - 132,116 Restricted for: Planning and development projects - - 2,724,240 10,767,199 Public safety - - 245,187 245,187 Community services - - 11,162,057 11,162,057 Public works - - 145,823 145,823 Capital Projects - - 4,089,156 4,089,156 Debt service - - 2,534 175,960 Committed to: - 1, 295 Emergency reserve - 1,5,523,401 01 Post retirement health benefits Assigned to: 172 Continuing appropriations - (5,988,442) ,, 68 34,489,268 Unassigned Total Fund Balances 14,446,166 107,131,530 Total Liabilities and Fund Balances $ $ $ 23,583,551 $ 143,999,922 See Notes to Financial Statements 21 146 THIS PAGE INTENTIONALLY LEFT BLANK °..� 147 22 CITY OF LA QUINTA RECONCILIATION OF THE BALANCE SHEET OF GOVERNMENTAL FUNDS TO THE STATEMENT OF NET ASSETS JUNE 30, 2012 Fund balances of governmental funds Amounts reported for governmental activities in the statement of net assets are different because: Capital assets net of depreciation have not been included as financial resources in governmental fund activity. Long-term debt and compensated absences that have not been included in the governmental fund activity: Bonds payable Compensated Absences Governmental funds report all OPEB contributions as expenditures, however in the statement of net assets any excess or deficiencies in contributions in relation to the Annual Required Contribution (ARC) are recorded as an asset or liability. Accrued interest payable for the current portion of interest due on Bonds has not been reported in the governmental funds. Revenues reported as deferred revenue in the governmental funds and recognized in the statement of activities. These are included in the intergovernmental revenues in the governmental fund activity. Internal service funds are used by management to charge the costs of certain activities, such as equipment management and self-insurance, to individual funds. The assets and liabilities of the internal service funds must be added to the statement of net assets. Net assets of govemmental activities $ (3,976,386) (932,241) $ 107,131,530 517,190,532 (4,908,627) (459,644) (54,043) 10,938,323 20,968,601 $ 650,806,672 See Notes to Financial Statements 23 '',.c , 148 CITY OF LA QUINTA STATEMENT OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCE GOVERNMENTALFUNDS YEAR ENDED JUNE 30.2012 Revenues: Taxes Assessments Licenses and permits Intergovernmental Charges for services Use of money and property Fines and forfeitures Developer participation Miscellaneous Total Revenues Expenditures: Current: General government Public safety Planning and development Community services Public works Capital outlay Debt service: Principal retirement Interest and fiscal charges Pass -through agreement payments Total Expenditures Special Revenue Funds Capital Projects Funds Housing Authority Capital General PA No. 2 Improvement Civic Center $ 21,296,301 $ $ $ 482,831 8,318,446 489,153 2,425,180 626,004 - _ 575,472 180,348 303,773 - _ _ - - 101,699 82,490 183,912 2,202 - 31,786,739 671,703 '2,526,879 82,490 4,669,060 204,787 19,619,113 - _ _ 1,207,755 331,314 _ 2,566,654 - 3,765,860 - _ 170,558 - 13,119,645 38,164 - _ _ 7,878 - 35,160 32,045,042 331,314 13,119,645 239,947 Excess (Deficiency) of Revenues Over (Under) Expenditures (258,303) 340,389 (10,592,766) (157,457) Other Financing Sources (Uses): Transfers in 411,105 - 9,394,375 Transfers out (1,358,275) (47,130) Proceeds from sale of capital asset Total Other Financing Sources (Uses) (947,170) 9,347,245 Extraordinary gain/(loss) on dissolution of redevelopment agency (Note 23) 7,110,645 - Net Change in Fund Balances (1,205,473) 7,451,034 (1,245,521) (157,457) Fund Balances, Beginning of Year Fund Balances, End of Year 93,081,554 618,400 1,154,860 (7,012,033) $ 91,876,081 $ 8,069,434 See Notes to Financial Statements 24 �_ , 149 CITY OF LA QUINTA STATEMENT OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCE GOVERNMENTAL FUNDS YEAR ENDED JUNE 30.2012 Debt Service Funds Other Total Redevelopment Redevelopment Governmental Governmental Agency PA No. 1 Agency PA No. 2 Funds Funds Revenues: Taxes $ 16,505,087 $ 9,365,929 $ 6,464,706 $ 53,632,023 Assessments - - 950,292 950,292 Licenses and permits - - - 482,831 Intergovernmental - - 4,642,803 15,875,582 Charges for services - - 9,107 635,111 Use of money and property (13,122) (15,571) 1,187,391 1,914,518 Fines and forfeitures - - - 303,773 Developer participation 718,955 903,144 Miscellaneous - - 90,213 276,327 Total Revenues 16,491,965 9,350,358 14,063,467 74,973,601 Expenditures: Current: General government - - 8,075 4,881,922 Public safety - - 50,404 19,669,517 Planning and development 428,522 241,543 2,105,512 4,314,646 Community services - - 1,520,032 4,086,686 Public works - - - 2,426,873 6,192,733 Capital outlay - - 45,786 13,335,989 Debt service: Principal retirement 3,947,652 380,000 2,700,910 7,066,726 Interest and fiscal charges 3,386,073 252,757 3,019,211 6,701,079 Pass -through agreement payments 8,986,409 7,769,032 - 16,755,441 Total Expenditures 16,748,656 8,643,332 11,876,803 83,004,739 Excess (Deficiency) of Revenues Over(Under)Expenditures (256,691) 707,026 2,186,664 (8,031,138) Other Financing Sources (Uses): Transfers in - 2,749,272 12,554,752 Transfers out (488,652) - (10,686,063) (12,580,120) Proceeds from sale of capital asset - - 875,275 875,275 Total Other Financing Sources (Uses) (488,652) Extraordinary gain/(loss) on dissolution of redevelopment agency (Note 23) (7,061,516) 849,907 (1,267,226) (84,901,674) (79,058,255) Net Change in Fund Balances (745,343) (560,200) (89,776,526) (86,239,486) Fund Balances, Beginning of Year Fund Balances, End of Year 745,343 560,200 104,222,692 193,371,016 $ $ - $ 14,446,166 $ 107,131,530 See Notes to Financial Statements 25 150 :, a _ CITY OF LA QUINTA RECONCILIATION OF THE STATEMENT OF REVENUES, EXPENDITURES, AND CHANGES IN FUND BALANCES OF GOVERNMENTAL FUNDS TO THE STATEMENT OF ACTIVITIES YEAR ENDED JUNE 30, 2012 Net change in fund balances - total governmental funds $ (86,239,486) 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 costs of those assets is allocated over their estimated useful lives as depreciation expense. This is the amount by which capital outlays exceeded depreciation in the current period. Capital outlay $13,226,234 Depreciation (8,857,852) Contributed capital assets (2,094,245) Gain/(loss) on sale of capital assets 1,230,857 3,504,994 Repayment of bond principal is an expenditure in the governmental funds, but the repayment reduces long-term liabilities in the statement of net assets. Principal repayments 7,025,428 Amortization of bond premiums/discounts (30,013) 6,995,415 Debt issuance costs are expenditures in governmental funds, but these costs are capitalized on the statement of net assets. (118,506) Accrued interest for long-term liabilities. This is the net change in accrued interest for the current period. 3,828,102 Compensated absences expenses reported in the statement of activities do not require the use of current financial resources and, therefore, are not reported as expenditures in governmental funds. 24,265 Governmental funds report all contributions in relation to the annual required contribution (ARC) as expenditures, however in the statement of activities only the ARC is an expense. (1,374,523) Revenues reported as deferred revenue in the governmental funds and recognized in the statement of activities. These are included in the intergovernmental revenues in the governmental fund activity. 4,833,280 Internal service funds are used by management to charge the costs of certain activities, such as equipment management and self-insurance, to individual funds. The net revenues (expenses) of the internal service funds is reported with governmental activities. 800,855 Extraordinary gains and losses relating to assets and liabilities transferred to the Successor Agency or County are reported in the statement of activities do not require the use of current financial resources and, therefore, are not reported in the governmental funds. Long-term liabilities 244,116,299 Long-term liabilities which have been absorbed by County 1,171,165 Deferred revenue (3,251,160) Unamortized bond issuance costs (4,323,334) 237,712,970 Change in net assets of governmental activities $ 169,967,366 See Notes to Financial Statements 26 151 CITY OF LA QUINTA BUDGETARY COMPARISON STATEMENT BY DEPARTMENT GENERALFUND YEAR ENDED JUNE 30, 2012 Variance with Final Budget Budget Amounts Actual Positive Original Final Amounts (Negative) Budgetary Fund Balance, July 1 $ 93,081,554 $ 93,081,554 $ 93,081,554 $ Resources (Inflows): Taxes 20,041,930 20,428,999 21,296,301 867,302 Licenses and permits 510,265 460,265 482,831 22,566 Intergovernmental 8,625,878 8,942,083 8,318,446 (623,637) Charges for services 527,935 670,575 626,004 (44,571) Use of money and property 1,293,560 718,560 575,472 (143.088) Fines and forfeitures 307,200 287,000 303,773 16,773 Miscellaneous 117,400 166,360 183,912 17,552 Transfers in 135,844 412,508 411,105 (1,403) Amounts Available for Appropriation 124,641,566 125,167,904 125,279,398 111,494 Charges to Appropriation (Outflow): General government Legislative 828,109 829,309 668,113 161,196 City Manager 296,311 341,033 372,657 (31,624) Development Services 1,212,164 1,150,351 1,139,973 10,378 Management Services 1,864,597 1,256,465 1,163,379 93,086 City Clerk 493,771 476,029 385,353 90,676 Fiscal Services 733,728 652,917 723,341 (70,424) Central Services 294,149 246,899 216,244 30,655 Public safety Police 12,712,089 12,874,770 12,071,222 803,548 Building & Safety Admin. 201,208 191,242 221,469 (30,227) Building 534,246 542,144 589,309 (47,165) Code Compliance 1,069,895 1,069,895 1,001,496 68,399 Animal Control 459,697 459,697 429,930 29,767 Civic Center Bldg 556,338 607,383 583,394 23,989 Fire 5,028,178 4,998,647 4,536,097 462,560 Emergency Services 185,392 225,392 186,196 39,196 Planning and development Administration 549,177 896,436 719,678 176,758 Current Planning 509,898 500,890 480,028 20,862 Low/Mod Housing 8,049 8,049 8,049 - Community services Community Services Admin 914,065 1,036,554 952,886 83,668 Senior Center 380,940 414,260 .382,642 31,618 Parks & Recreation 208,357 201,357 191,936 9,421 Park Maintenance 1,077,556 1,077,556 1,039,190 38,366 Public works Administration 474,277 478,012 473,137 4,875 Development Services 574,764 588,722 574,030 14,692 Maintenance/Operations- Street 951,033 1,368,299 791,363 576,936 Maintenance/Operations - Lighting 530,565 530,565 459,461 71,104 Construction Management 1,287,018 1,220,182 1,467,869 (247,687) Capital outlay 55,300 267,330 170,558 96,772 Debt service: Principal retirement 38,164 38,164 38,164 - Interest and fiscal charges 7,878 7,878 7,878 - Transfers out 635,325 1,505,776 1,358,275 147,501 Total Charges to Appropriations 34,672,238 36,062,203 33,403,317 2,658,886 Budgetary Fund Balance, June 30 $ 89,969,328 $ 89,105,701 $ 91,876,081 $ 2,770,380 See Notes to Financial Statements 27 152 CITY OF LA QUINTA BUDGETARY COMPARISON STATEMENT HOUSING AUTHORITY PA NO. 2 YEAR ENDED JUNE 30, 2012 Variance with Final Budget Budget Amounts Actual Positive Original Final Amounts (Negative) Budgetary Fund Balance, July 1 $ 618,400 $ 618,400 $ 618,400 $ Resources (Inflows): Intergovernmental Use of money and property Miscellaneous Transfers in Amounts Available for Appropriation Charges to Appropriation (Outflow): Planning and development Debt service: Principal retirement Interest and fiscal charges Transfers out Extraordinary gain/(loss) on dissolution of redevelopment agency Total Charges to Appropriations Budgetary Fund Balance, June 30 498,200 498,200 489,153 (9,047) 164,390 164,390 180,348 15,958 3,700 3,700 2,202 (1,498) - 7,110,645 (7,110,645) 1,284,690 8,395,335 1,290,103 (7,105,232) 385,222 385,232 331,314 53,918 42,832 42,832 - 42,832 196,925 196,925 196,925 - 7,033,408 7,033,408 - (7,110,645) 7,110,645 624,979 7,658,397 (6,779,331) 14,437,728 $ 659,711 $ 736,938 $ 8,069,434 $ 7,332,496 See Notes to Financial Statements 28 '. 1�.. i 153 CITY OF LA QUINTA STATEMENT OF NET ASSETS PROPRIETARY FUNDS JUNE 30, 2012 Assets: Current: Cash and investments Receivables: Accounts Accrued interest Prepaid costs Deposits Inventories Total Current Assets Noncurrent: Capital assets - net of accumulated depreciation Total Noncurrent Assets Total Assets Liabilities and Net Assets: Liabilities: Current: Accounts payable Accrued liabilities Unearned revenues Deposits payable Accrued compensated absences Bonds, notes, and capital leases Total Current Liabilities Noncurrent: Advances from other funds Accrued compensated absences Bonds, notes, and capital leases Total Noncurrent Liabilities Total Liabilities Net Assets: Invested in capital assets, net of related debt Unrestricted Total Net Assets Total Liabilities and Net Assets See Notes to Financial Statements 29 Business -Type Governmental Activities - Activities - Enterprise Funds Internal Golf Course Service Funds $ 435,601 $ 3,794,621 22,242 - 128 1,225 1,865 240 250,000 - 67,605 777,441 3,796,086 42,274,767 17,197,947 42,274,767 17,197,947 $ 43,052,208 $ 20,994,033 $ 167,718 $ 11,771 2,217 3,948 4,873 - 35,500 - - 4,078 125,348 - 335,656 19,797 5,313,025 - - 5,635 43,736 - 5,356,761 5,635 5,692,417 25,432 42,105,683 17,197,947 (4,745,892) 3,770,654 37,359,791 $ 43,052,208 20,968,601 $ 20,994,033 n 154 THIS PAGE INTENTIONALLY LEFT BLANK 30 � 155 CITY OF LA QUINTA STATEMENT OF REVENUES, EXPENSES AND CHANGES IN FUND NET ASSETS PROPRIETARY FUNDS YEAR ENDED JUNE 30, 2012 Operating Revenues: Sales and service charges Miscellaneous Total Operating Revenues Operating Expenses: Salaries and benefits Fuel and oil Maintenance and parts Contract services Software and supplies Depreciation expense Other Total Operating Expenses Operating Income (Loss) Nonoperating Revenues (Expenses): Interest revenue Interest expense _ Gain (loss) on disposal of capital assets Total Nonoperating Revenues(Expenses) Income (Loss) Before Contributions and Transfers Capital contributions Transfers in Changes in Net Assets Net Assets: Beginning of Year End of Fiscal Year Business -Type Activities - Enterprise Funds Golf Course $ 3,871,898 Governmental Activities - Internal Service Funds $ 1,086,110 29,553 3,871,898 1,115,663 62,751 3,416,655 502,381 68,813 4,050,600 (178,702) 1,075 (34,682) 113,729 91,233 74,179 93,174 105,841 804,420 8,934 1,291,510 (175,847) 10,737 3,434 (33,607) 14,171 (212,309) (161,676) 937,163 25,368 (212,309) 800,855 37,572,100 20,167,746 $ 37,359,791 $ 20,968,601 See Notes to Financial Statements 31 CITY OF LA QUINTA STATEMENT OF CASH FLOWS PROPRIETARY FUNDS YEAR ENDED JUNE 30, 2012 Cash Flows from Operating Activities: Cash received from customers and users Cash received from/(paid to) interfund service provided Cash paid to suppliers for goods and services Cash paid to employees for services Net Cash Provided (Used) by Operating Activities Cash Flows from Non -Capital Financing Activities: Cash transfers in Advance from other funds Net Cash Provided (Used) by Non -Capital Financing Activities Cash Flows from Capital and Related Financing Activities: Acquisition and construction of capital assets Principal paid on capital debt Interest paid on capital debt Proceeds from sales of capital assets Net Cash Provided (Used) by Capital and Related Financing Activities Cash Flows from Investing Activities: Interest received Net Cash Provided (Used) by Investing Activities Net Increase(Decrease)in Cash and Cash Equivalents Cash and Cash Equivalents at Beginning of Year Cash and Cash Equivalents at End of Year Business -Type Governmental Activities - Activities - Enterprise Funds Internal Golf Course Service Funds $ 3,884,814 $ 1,115,423 (6,263) - (3,503,102) (441,476) (62,696) (113,337) 312,753 560,610 25,368 (94,302) (94,302) 25,368 (37,223) (117,013) (34,682) -. 3,434 (151,695) (33,789) 1,180 11,827 11,827 67,936 564,016 367,665 3,230,605 $ 435,601 $ 3,794,621 See Notes to Financial Statements 32 -,,t. 157 CITY OF LA QUINTA STATEMENT OF CASH FLOWS PROPRIETARY FUNDS YEAR ENDED JUNE 30, 2012 Reconciliation of Operating Income to Net Cash Provided (Used) by Operating Activities: Operating income (loss) Adjustments to reconcile operating income (loss) net cash provided (used) by operating activities: Depreciation (Increase) decrease in accounts receivable (Increase) decrease in inventories (Increase) decrease in prepaid expense Increase(decrease)in accounts payable Increase (decrease) in accrued liabilities Increase (decrease) in deposits payable Increase (decrease)in unearned revenue Increase (decrease)in compensated absences Total Adjustments Net Cash Provided (Used) by Operating Activities Non -Cash Investing, Capital, and Financing Activities: Capital assets contributed by other funds Business -Type Governmental Activities - Activities - Enterprise Funds Internal Golf Course Service Funds $ (178,702) $ (175,847) 502,381 9,275 11,862 1,741 55 (37,500) 3,641 804,420 (240) (68,115) 94 298 491,455 736,457 $ 312,753 $ 560,610 937.163 See Notes to Financial Statements 33 15 8 o wJ CITY OF LA QUINTA STATEMENT OF FIDUCIARY NET ASSETS FIDUCIARY FUNDS JUNE 30, 2012 Pension Trust Private -Purpose Fund Trust Fund Successor Agency Supplemental Agency of the Funds Pension Plan former RDA Assets: Pooled cash and investments $ 550,232 $ 187,924 $ 23,193,145 Receivables: Accounts - - 21,000 Taxes 9,041 - Notes and loans - - 3,251,160 Accrued interest 164 63 9,300 Due from other governments - - 3,546,921 Deferred charges 4,238,688 Restricted assets: Cash and investments with fiscal agents - - 57,077,193 Total Assets $ 559,437 $ 187,987 $ 91,337,407 Liabilities: Accounts payable $ - $ - $ 251,039 Accrued interest - 3,778,175 Deposits payable 559,437 - - Long-term liabilities: Due in one year - - 5,876,783 Due in more than one year - - 238,242,606 Total Liabilities $ 559,437 $ $ 248,148,603 Net Assets: Held in trust for pension $ - $ 187,987 $ - Held in trust for other purposes - (156,811,196) Total Net Assets $ - $ 187,987 $ (156,811,196) See Notes to Financial Statements 34 -; 159 CITY OF LA QUINTA STATEMENT OF CHANGES IN FIDUCIARY NET ASSETS FIDUCIARY FUNDS YEAR ENDED JUNE 30, 2012 Additions: Contributions: Employers Taxes Interest and change in fair value of investments Total Additions Deductions: Administrative expenses Interest expense Contributions to other governments Total Deductions Extraordinary gain/(loss) on dissolution of redevelopment agency (Note 23) Changes in Net Assets Net Assets - Beginning of the Year Net Assets - End of the Year Pension Trust Private -Purpose Fund Trust Fund Successor Supplemental Agency of the Pension Plan former RDA $ 200,054 $ - - 13,231,246 766 53,827 200,820 13,285,073 12,833 959,782 - 10,804,220 848,717 12,833 12,612,719 - (157,483,550) 187,987 (156,811,196) $ 187,987 $ (156,811,196) See Notes to Financial Statements 35 p 0Mj 160 THIS PAGE INTENTIONALLY LEFT BLANK 36 �.�1 161 CITY OF LA QUINTA NOTES TO FINANCIAL STATEMENTS JUNE 30, 2012 I. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Note 1: Summary of Significant Accounting Policies a. Reporting Entity The City of La Quinta (City) was incorporated May 1, 1982, under the general laws of the State of California. In November 1996, the City became a charter City. The City operates under the Council — Manager form of government. The City provides many community services including public safety, highway and street maintenance, health and social services, cultural and leisure services, public improvements, planning and zoning services, and community development services. The accounting policies of the City conform to generally accepted accounting principles as applicable to governments. As required by generally accepted accounting principles, these financial statements present the government and its component units, which are entities for which the government is considered to be financially accountable. The City is considered to be financially accountable for an organization if the City appoints a voting majority of that organization's governing body and the City is able to impose its will on that organization or there is a potential for that organization to provide specific financial benefits to or impose specific financial burdens on the City. The City is also considered to be financially accountable if an organization is fiscally dependent (i.e., it is unable to adopt its budget, levy taxes, set rates or charges, or issue bonded debt without approval from the City). In certain cases, other organizations are included as component units if the nature and significance of their relationship with the City are such that their exclusion would cause the City's financial statements to be misleading or incomplete. All of the City's component units are considered to be blended component units. Blended component units, although legally separate entities, are, in substance, part of the government's operations and so data from these units are reported with the interfund data of the primary government. The following organizations are considered to be component units of the City: La Quinta Redevelopment Agency The La Quinta Redevelopment Agency (Agency) has established two redevelopment project areas pursuant to the State of California Health & Safety Code, Section 33000 entitled "Community Redevelopment Law". On November 29, 1983 and May 16, 1989, the City Council approved and adopted the Redevelopment Plans for the La Quinta Redevelopment Project Areas No. 1 and No. 2, respectively. These plans provide for the elimination of blight and deterioration, which was found to exist in the project areas. Although the Agency is legally separate, it is reported as if it were part of the City because the City Council also serves as the governing board of the Agency. The redevelopment agency was dissolved as of January 31, 2012 through the Supreme Court decision on Assembly Bill 1X 26. See Note 21 for' more information on the dissolution." 37 _.. 162 CITY OF LA QUINTA NOTES TO FINANCIAL STATEMENTS (CONTINUED) JUNE 30, 2012 Note 1: Summary of Significant Accounting Policies (Continued) City of La Quinta Public Financing Authority The La Quinta Public Financing Authority (Financing Authority) was established pursuant to a Joint Exercise of Powers Agreement dated November 19, 1991, between the City and the Agency. The purpose of the Financing Authority is to provide financing necessary for the construction of various public improvements through the issuance of debt. Although the Financing Authority is legally separate, it is reported as if it were part of the City because the City Council also serves as the governing board of the Financing Authority. Separate financial statements of the Financing Authority are not prepared. City of La Quinta Housing Authority The La Quinta Housing Authority (Housing Authority) was established pursuant to California Housing Authorities Law (Health and Safety Code Sections 34200 et seq.) on September 15, 2009. The purpose of the Housing Authority is to provide safe and sanitary housing opportunities for La Quinta residents. Although the Housing Authority is legally separate, it is reported as if it were part of the City because the City Council also serves as the governing board of the Housing Authority. Separate financial statements of the Housing Authority are not prepared. b. Government -Wide and Fund Financial Statements The basic financial statements of the City are composed of the following: • Government -wide financial statements • Fund financial statements • Notes to the financial statements Financial reporting is based upon all GASB Statements and Interpretations, APB Opinions, were issued on or before November 30, 1989, GASB pronouncements. Government -wide Financial Statements pronouncements, as well as the FASB and Accounting Research Bulletins that that does not conflict with or contradict The government -wide financial statements (i.e., the statement of net assets and the statement of activities) report information on all of the nonfiduciary activities of the primary government and its component units. All fiduciary activities are reported only in the fund financial statements. Governmental activities, which normally are supported by taxes, intergovernmental revenues, and other nonexchange transactions, are reported separately from business -type activities, which rely to a significant extent on fees and charges to external customers for support. Likewise, the primary government is reported separately from certain legally separate component units for which the primary government is financially accountable. The statement of activities demonstrates the degree to which the direct expenses of a given function or segments are offset by program revenues. Direct expenses are those that are clearly identifiable with a specific function or segment. Program revenues include charges for services, special assessments, and payments made by parties outside of the reporting government's citizenry if that money is restricted to a particular program. Program revenues are netted with program expenses in the 38 .� 163 CITY OF LA QUINTA NOTES TO FINANCIAL STATEMENTS (CONTINUED) JUNE 30, 2012 Note 1: Summary of Significant Accounting Policies (Continued) statement of activities to present the net cost of each program. Taxes and other items not properly included among program revenues are reported instead as general revenues. Amounts paid to acquire capital assets are capitalized as assets in the government -wide financial statements, rather than reported as expenditures. Proceeds of long-term debt are recorded as a liability in the government -wide financial statements, rather than as other financing sources. Amounts paid to reduce long-term indebtedness of the reporting government are reported as a reduction of the related liability, rather than as expenditures. Fund Financial Statements The underlying accounting system of the City is organized and operated on the basis of separate funds, each of which is considered to be a separate accounting entity. The operations of each fund are accounted for with a separate set of self -balancing accounts that comprise its assets, liabilities, fund equity, revenues and expenditures or expenses, as appropriate. Governmental resources are allocated to and accounted for in individual funds based upon the purposes for which they are to be spent and the means by which spending activities are controlled. Fund financial statements for the governmental, proprietary, and fiduciary funds are presented after the government -wide financial statements. These statements display information about major funds individually and nonmajor funds in the aggregate for governmental and enterprise funds. Fiduciary statements include financial information for fiduciary funds and similar component units. Fiduciary funds of the City primarily represent assets held by the City in a custodial capacity for other individuals or organizations. C. Measurement Focus, Basis of Accounting and Financial Statement Presentation Government -wide Financial Statements While separate government -wide and fund financial statements are presented, they are interrelated. The governmental activities column incorporates data from governmental funds and internal service funds, while business -type activities incorporate data from the government's enterprise funds. 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. Governmental Funds In the fund financial statements, governmental funds are presented using the modified -accrual basis of accounting. Their revenues are recognized when they become measurable and available as net current assets. Measurable means that the amounts can be estimated, or otherwise determined. Available means that the amounts were collected during the reporting period or soon enough thereafter to be available to finance the expenditures accrued for the reporting period. The City uses a 60 day availability period. 39 �.- 164 CITY OF IA QUINTA NOTES TO FINANCIAL STATEMENTS (CONTINUED) JUNE 30, 2012 Note 1: Summary of Significant Accounting Policies (Continued) Revenue recognition is subject to the measurable and availability criteria for the governmental funds in the fund financial statements. Exchange transactions are recognized as revenues in the period in which they are earned (i.e., the related goods or services are provided). Locally imposed delivered tax revenues are recognized as revenues in the period in which the underlying exchange transaction on which they are based takes place. Imposed nonexchange transactions are recognized as revenues in the period for which they were imposed. If the period of use is not specified, they are recognized as revenues when an enforceable legal claim to the revenues arises or when they are received, whichever occurs first. Govemment-mandated and voluntary non -exchange transactions are recognized as revenues when all applicable eligibility requirements have been met. Property taxes, franchise taxes, licenses and interest associated with the current fiscal period are all considered to be susceptible to accrual and so have been recognized as revenues of the current fiscal period. All other revenue items are considered to be measurable and available only when cash is received by the government. In the fund financial statements, governmental funds are presented using the current financial resources measurement focus. This means that only current assets and current liabilities are generally included on their balance sheets. The reported fund balance (net current assets) is considered to be a measure of "available spendable resources". Governmental fund operating statements present increases (revenues and other financing sources) and decreases (expenditures and other financing uses) in net current assets. Accordingly, they are said to present a summary of sources and uses of "available spendable resources" during a period. Noncurrent portions of long-term receivables due to governmental funds are reported on their balance sheets in spite of their spending measurement focus. Special reporting treatments are used to indicate, however, that they should not be considered "available spendable resources", since they do not represent net current assets. Recognition of governmental fund type revenues represented by noncurrent receivables are deferred until they become current receivables. Noncurrent portions of other long-term receivables are offset by fund balance reserve accounts. Because of their spending measurement focus, expenditure recognition for governmental fund types excludes amounts represented by noncurrent liabilities. Since they do not affect net current assets, such long-term amounts are not recognized as governmental fund type expenditures or fund liabilities. Amounts expended to acquire capital assets are recorded as expenditures in the year that resources were expended, rather than as fund assets. The proceeds of long-term debt are recorded as other financing sources rather than as a fund liability. Amounts paid to reduce long-term indebtedness are reported as fund expenditures. When both restricted and unrestricted resources are combined in a fund, expenses are considered to be paid first from restricted resources, and then from unrestricted resources. CITY OF LA QUINTA NOTES TO FINANCIAL STATEMENTS (CONTINUED) JUNE 30, 2012 Note 1: Summary of Significant Accounting Policies (Continued) Proprietary Funds The City's enterprise and internal service funds are proprietary funds. In the fund financial statements, proprietary funds are presented using the accrual basis of accounting. Revenues are recognized when they are earned and expenses are recognized when the related goods or services are delivered. In the fund financial statements, proprietary funds are presented using the economic resources measurement focus. This means that all assets and all liabilities (whether current or noncurrent) associated with their activity are included on their balance sheets. Proprietary fund type operating statements present increases (revenues) and decreases (expenses) in total net assets. Amounts paid to acquire capital assets are capitalized as assets in the proprietary fund financial statements, rather than reported as expenditures. Proceeds of long-term debt are recorded as a liability in the proprietary fund financial statements, rather than as another financing source. Amounts paid to reduce long-term indebtedness of the proprietary funds are reported as a reduction of the related liability, rather than as expenditures. Proprietary funds distinguish operating revenues and expenses from nonoperating 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 Enterprise Funds are charges to customers for sales and services. Operating expenses for Enterprises Funds include the cost of sales and services, administrative expenses and depreciation on capital assets. All revenues and expenses not meeting this definition are reported as nonoperating revenues and expenses. Private -sector standards of accounting and financial reporting issued prior to December 1989, generally are followed in both the government -wide and proprietary fund financial statements to the extent that those standards do not conflict with or contradict guidance of the Governmental Accounting Standards Board. Governments also have the option of following subsequent private -sector guidance for their business -type activities and enterprise funds, subject to this same limitation. The government has elected not to follow subsequent private -sector guidance. Fiduciary Funds The pension and private -purpose trust funds are reported using the economic resources measurement focus and the accrual basis of accounting. The agency fund has no measurement focus but utilizes the accrual basis of accounting for reporting its assets and liabilities. d. Major Funds, Internal Service Funds and Fiduciary Fund Types The City's major governmental funds are as follows: General Fund — This fund is the primary fund of the City and is used to account for all revenue and expenditures of the City not legally restricted as to use. A broad range of municipal activities are provided through this fund including City Manager, City Attorney, Finance, City Clerk, Community Development, Police Services, Public Works, Building and Safety, and Community Services. CITY OF LA QUINTA NOTES TO FINANCIAL STATEMENTS (CONTINUED) JUNE 30, 2012 Note 1: Summary of Significant Accounting Policies (Continued) Housing Authority Project Area No 2 — To account for the housing activities of the Housing Authority in Project Area 2 which is to promote and provide for quality housing. Capital Improvement Fund — This capital projects fund is used to account for the planning, design and construction of various capital projects throughout the City and the Agency. Civic Center Fund — To account for the accumulation of resources provided through developer fees for the acquisition, construction, or improvement of the Civic Center. Redevelopment Agency Project Area No 1 - Debt Service Fund — This debt service fund is used to account for the accumulation of resources for the payment of debt service for bond principal and interest and trustee fees for Project Area No. 1. Redevelopment Agency Proiect Area No 2 - Debt Service Fund — This Debt service fund is used to account for the accumulation of resources for the payment of debt service for bond principal, interest and trustee fees for Project Area No. 2. The City's major proprietary fund is as follows: Golf Course — To account for the activities of the SilverRock Golf Resort. Other fund types of the City are as follows: Internal Service Funds: Equipment Replacement Fund — This fund accounts for equipment and vehicle maintenance and replacement services provided to other departments on a cost -reimbursement basis. Information Technology Fund — This fund is used to account for the acquisition for computer equipment, maintenance, and services to support information systems within the City. Costs are reimbursed by the benefiting departments. Park Equipment and Facilities Fund — This fund is used to account for the purchase and replacement of City owned park facility infrastructure. Costs are reimbursed by the benefiting departments. Fiduciary Funds: Agency Fund — This fund accounts for assets held by the City as an agency for assessment district bondholders. Pension Trust Fund — This fund accounts for the activities of the Supplemental Pension Savings Plan, which accumulates resources for pension benefit payments to qualified government employees. Private -Purpose Trust Fund — This fund accounts for the assets and liabilities of the former redevelopment agency and is allocated revenue to pay estimated installment payments of enforceable obligations until obligations of the former redevelopment agency are paid in full and assets have been liquidated. 42 , 167 CITY OF LA QUINTA NOTES TO FINANCIAL STATEMENTS (CONTINUED) JUNE 30, 2012 Note 1: Summary of Significant Accounting Policies (Continued) e. Assets, Liabilities and Net Assets or Equity Investments For financial reporting purposes, investments are adjusted to their fair value. Changes in fair value that occur during a fiscal year are recognized as investment income reported for that fiscal year. Investment income includes interest earnings, changes in fair value, and any gains or losses realized upon the liquidation or sale of investments. Some investments are valued on an unamortized cost basis. For these investments, there is no material difference from fair value. The City pools cash and investments of all funds, except for assets held by fiscal agents. Each fund's share in this pool is displayed in the accompanying financial statements as cash and investments. Investment income earned by the pooled investments is allocated to the various funds based on each fund's average cash and investment balance. Cash and Cash Equivalents For purposes of the statement of cash flows, cash equivalents are defined as short-term, highly liquid investments that are both readily convertible to known amounts of cash or so near their maturity that they present insignificant risk of changes in value because of changes in interest rates. Cash equivalents also represent the proprietary fund's share in the cash and investment pool of the City of La Quinta. Cash equivalents have an original maturity date of three months or less from the date of purchase. For purposes of the statement of cash flows, the entire balance of cash and investments on the combined balance sheet for the proprietary funds is considered cash and cash equivalents. Inventory Inventory is valued at cost using the first in/first out (FIFO) method. The City uses the consumption method of accounting for inventories. Prepaid Items Certain payments to vendors reflect costs applicable to future accounting periods and are recorded as prepaid items in both government -wide and fund financial statements. The City utilizes the consumption method, in which prepaid items are accounted for in the period that the benefit was received. Capital Assets Capital assets (including infrastructure) are recorded at cost where historical records are available and at an estimated historical cost where no historical records exist. Contributed capital assets are valued at their estimated fair market value at the date of the contribution. Generally, capital asset purchases in excess of $5,000 are capitalized if they have an expected useful life of three years or more. Capital Assets include public domain (infrastructure) consisting of certain improvements including roads, streets, sidewalks, medians, and storm drains. 43 1-11'• 168 CITY OF LA QUINTA NOTES TO FINANCIAL STATEMENTS (CONTINUED) JUNE'30, 2012 Note 1: Summary of Significant Accounting Policies (Continued) Capital assets used in operations are depreciated over their estimated useful lives using the straight-line method in the government -wide financial statements and in the fund financial statements of the proprietary funds. Depreciation is charged as an expense against operations and accumulated depreciation is reported on the respective balance sheet. The following schedule summarizes capital asset useful lives: Buildings and improvements 10-30 years Equipment and furniture 3-20 years Vehicles 5-10 years Infrastructure 10-50 years Software 5-10 years Compensated Absences Sick time is vested on a percentage based on number of years employed at the City. Maximum accumulation of sick and vacation is 30 and 40 days, respectively. Upon termination or retirement, permanent employees are entitled to receive compensation at their current base salary for all unused vacation leave. If an employee terminates with a minimum of two years service, the employee is entitled to receive 25% of the value of his unused sick leave. The percentage increases by 25% for each five-year period until the employee is entitled to 75% of the value of his unused sick leave. This will occur upon the completion of ten years of continuous employment Fund Balance In the fund financial statements, governmental funds report the following fund balance classification: Nonsoendable includes amounts that cannot be spent because they are either (a) not in spendable form or (b) legally or contractually required to be maintained intact. Restricted includes amounts that are constrained on the use of resources by either (a) external creditors, grantors, contributors, or laws of regulations of other governments or (b) by law through constitutional provisions or enabling legislation. Committed includes amounts that can only be used for specific purposes pursuant to constraints imposed by formal action of the government's highest authority, the City Council. The formal action that is required to be taken to establish, modify, or rescind a fund balance commitment is by resolution. Assigned includes amounts that are constrained by the government's intent to be used for specific purposes, but are neither restricted nor committed. City Council is authorized to assign amounts to a specific purpose. Unassigned includes the residual amounts that have not been restricted, committed, or assigned to specific purposes. 44 ;r. 169 CITY OF LA QUINTA NOTES TO FINANCIAL STATEMENTS (CONTINUED) JUNE 30, 2012 Note 1: Summary of Significant Accounting Policies (Continued) The City Council adopts and amends committed fund balance amounts through a resolution. The City Council authorizes assigned amounts for specific purposes pursuant to the policy -making powers granted through a resolution. When an expenditure is incurred for purposes for which both restricted and unrestricted fund balance is available, the City considers restricted amounts to be used first, then unrestricted. When an expenditure is incurred for purposes for which amounts in any of the unrestricted fund balance classifications could be used, they are considered to be spent in the following order: committed, assigned and then unassigned. II. STEWARDSHIP Note 2: Stewardship, Compliance and Accountability a. Budgetary Data General Budget Policies The City adopts an annual budget prepared on the modified accrual basis of accounting for its governmental funds and on the accrual basis of accounting for its proprietary funds. The City manager or his designee is authorized to transfer budgeted amounts between the accounts of any department or funds that are approved by City Council. Prior year appropriations lapse unless they are approved for carryover into the following fiscal year. Expenditures may not legally exceed appropriations at the department level. Budgets were not adopted for the Development Agreement funds. Encumbrances Encumbrances are estimations of costs related to unperformed contracts for goods and services. These commitments are recorded for budgetary control purposes in the General, Special Revenue, and similar governmental funds. Encumbrances outstanding at year-end are reported as an unassigned fund balance. They represent the estimated amount of the expenditure ultimately to result if unperformed contracts in process at year end are completed. They do not constitute expenditures or estimated liabilities. Budget Basis of Accounting Budgets for governmental funds are adopted on a basis consistent with generally accepted accounting principles (GAAP). 45 11 170 CITY OF LA QUINTA NOTES TO FINANCIAL STATEMENTS (CONTINUED) JUNE 30, 2012 Note 2: Stewardship, Compliance and Accountability (Continued) b. At June 30, 2012, the following funds had deficit fund balances: Major Capital Projects Funds Capital Improvement $ 90,661 Civic Center 7,169,490 Nonmajor Special Revenue Funds: Federal Assistance " 8,882 Nonmajor Capital Projects Funds: Parks and Recreation 1,183,816 Library Development 1,860,330 Street Facility 2.021,772 Fire Facility 913,642 c. Excess of expenditures over appropriations are as follows: Expenditures for the year ended June 30, 2012, exceeded the appropriations of the General Fund as follows: General Fund: General Government City Manager Fiscal Services Public Safety Building & safety admin Building Public Works Construction management Budget Actual Variance $ 341,033 $ 372,657 $ 31,624 652,917 723,341 70,424 191,242 221,469 30,227 542,144 589,309 47,165 1,220,182 1,467,869 247,687 Ill. DETAILED NOTES ON ALL FUNDS Note 3: Cash and Investments Cash and investments as of June 30, 2012, are classified in the accompanying financial statements as follows: Statement of Net Assets Cash and investments $ 108,200,219 Statement of Fiduciary Net Assets: Cash and investments 23,931,301 Cash with fiscal agent 57,077,193 Total cash and investments $ 189,208,713 46 to " 171 CITY OF LA QUINTA NOTES TO FINANCIAL STATEMENTS (CONTINUED) JUNE 30, 2012 Note 3: Cash and Investments (Continued) Cash and investments as of June 30, 2012, consist of the following: Cash on hand $ 1,905 Deposits with financial institutions 453,410 Investments 188,753,398 Total cash and investments $ 189,208,713 The California Government Code requires California banks and savings and loan associations to secure a City's deposits by pledging government securities with a value of 110% of a City's deposits. California law also allows financial institutions to secure City deposits by pledging first trust deed mortgage notes having a value of 150% of a City's total deposits. The City Treasurer may waive the collateral requirement for deposits which are fully insured up to $250,000 by the FDIC. The collateral for deposits in federal and state chartered banks is held in safekeeping by an authorized Agent of Depository recognized by the State of California Department of Banking. The collateral for deposits with savings and loan associations is generally held in safekeeping by the Federal Home Loan Bank in San Francisco, California as an Agent of Depository. These securities are physically held in an undivided pool for all California public agency depositors. Under Government Code Section 53655, the placement of securities by a bank or savings and loan association with an "Agent of Depository" has the effect of perfecting the security interest in the name of the local governmental agency. Accordingly, all collateral held by California Agents of Depository are considered to be held for, and in the name of, the local governmental agency. A provision of the Dodd -Frank Wall Street Reform and Consumer Protection Act provides temporary unlimited deposit insurance coverage for noninterest-bearing transaction accounts at all FDIC -insured institutions. This provision was effective from December 31, 2010 and will remain effective until December 31, 2012. Noninterest-bearing transaction accounts is defined as an account (1) with respect to which interest is neither accrued nor paid; (2) on which the depositor or account holder is permitted to make withdrawals by negotiable or transferable instrument, payment orders of withdrawal, telephone or other electronic media transfers, or other similar items for the purpose of making payments or transfers to third parties or others; and (3) on which the FDIC -insured depository institutions does not reserve the right to require advance notice of an intended withdrawal. As of June 30, 2012, the City maintains cash deposits that are temporarily covered by this provision. Cash Deposits At June 30, 2012, the carrying amount of the City's deposits was $453,410, and the bank balance was $1,181,777. The $728,367 difference represents outstanding checks and other reconciling items. The table below identifies the investment types that are authorized by the California Government Code and the City's investment policy. The table also identifies certain provisions of the California Government Code (or the City's investment policy, if more restrictive) that address interest rate risk, credit risk, and concentration of credit risk. This table does not address investments of debt proceeds held by bond trustee that are governed by the provisions of debt agreements of the City, rather than the general provisions of the California Government Code or the City's investment policy. 47 112 CITY OF LA QUINTA NOTES TO FINANCIAL STATEMENTS (CONTINUED) JUNE 30, 2012 Note 3: Cash and Investments (Continued) Investment Types Authorized by State Law *Maximum Maturity *Maximum Percentage of Portfolio *Maximum Investment In One Issuer U.S. Treasury Obligations 10 years None $30 million U.S. Agency Securities 3 years None $30 million Local Agency Bonds 10 years None $30 million California Local Agency Obligations 10 years 30% $30 million Commercial Paper 90 days 15% $5 million Certificates of Deposit 3 years 60% $250,000 Medium -Term Notes 3 years 10% $5 million Money Market Mutual Funds 60 days 20% 10% Local Agency Investment Fund (LAIF) N/A 30% $40 million Investment Agreements N/A N/A N/A * Based on state law requirements or investment policy requirements, Disclosures Relating to Interest Rate Risk Interest rate risk is the risk that changes in market interest rates will adversely affect the fair value of an investment. Generally, the longer the maturity of an investment, the greater the sensitivity of its fair value to changes in market interest rates. One of the ways that the City manages its exposure to interest rate risk is by purchasing a combination of short term and long term investments and by timing cash flows from maturities so that a portion of the portfolio is maturing or coming close to maturity evenly over time as necessary to provide the cash flow and liquidity needed for operations. Information about the sensitivity of the fair values of the City's investments (including investments held by bond trustee) to market interest rate fluctuations is provided by the following table that shows the distribution of the City's investments by maturity: Remaining Maturity (in Months) 6 Months 6 Months to 1 Investment Type Total or Less Year 1 to 3 Years U.S. Treasury notes $ 29,986,384 $ 29,986,384 $ - $ - U.S. Treasury bills 1,999,744 1,999,744 - Certificates of Deposit 724,000 484,000 - 240,000 Federal agency securities: Federal Home Loan Bank 8,998,321 8,998,321 - - Commercial paper 11,997,202 11,997,202 - - Rabobank 39,959,692 39,959,692 - - Stateinvestmentpool 38,010,862 38,010,862 - Held by bond trustee: Money market funds 57,077,193 57,077,193 - Total $ 188,753,398 $ 188,513.398 $ - $ 240,000 48 .'a. 173 CITY OF LA QUINTA NOTES TO FINANCIAL STATEMENTS (CONTINUED) JUNE 30, 2012 Note 3: Cash and Investments (Continued) Disclosures Relating to Credit Risk Generally, credit risk is the risk that an issuer of an investment will not fulfill its obligation to the holder of the investment. This is measured by the assignment of a rating by a nationally recognized statistical rating organization. The City's investment policy limits investments in commercial paper to those rated A-1 and P-1 or higher from Standard and Poor's (S&P) and money market mutual funds that are rated "AAA". The quality of U.S. Treasury securities is not analyzed since they are not deemed to have credit risk. As of June 30, 2012, the City had investments with a variety of issuers, all of which were "investment grade" and were legal under state and municipal law. The City's investments in money market mutual funds were all rated "AAA", federal agency securities were all rated AA+, and commercial paper were rated A-1 by S&P and Moody's. As of June 30, 2012, the City's investments in external investment pools were unrated. Concentration of Credit Risk The investment policy of the City contains no limitations on the amount that can be invested in any one issuer beyond that stipulated by the California Government Code, except for U.S. Agency Securities and Commercial Paper. As of June 30, 2012, the City had no, individual investments that represent 5% or more of total investments. Custodial Credit Risk Custodial credit risk for deposits is the risk that, in the event of the failure of a depository financial institution, a government will not be able to recover its deposits or will not be able to recover collateral securities that are in the possession of an outside party. The custodial credit risk for investments is the risk that, in the event of the failure of the counterparty (e.g., broker -dealer) to a transaction, a government will not be able to recover the value of its investment or collateral securities that are in the possession of another party. The California Government Code and the City's investment policy do not contain legal or policy requirements that would limit the exposure to custodial credit risk for deposits or investments, other than the following provision for deposits: The California Government Code requires that a financial institution secure deposits made by state or local governmental units by pledging securities in an undivided collateral pool held by a depository regulated under state law (unless so waived by the governmental unit). The market value of the pledged securities in the collateral pool must equal at least 110% of the total amount deposited by the public agencies. California law also allows financial institutions to secure City deposits by pledging first trust deed mortgage notes having a value of 150% of the secured public deposits. The City has money market accounts (MMA's) with Rabobank, N.A. These Accounts are the financial obligations of the bank, and are collateralized with government securities at 110% of the balance on deposit. As of June 30, 2012, the City's investments of $39,959,692 were collateralized in accordance with the California Government Code. Investment in State Investment Pool The City is a voluntary participant in the Local Agency Investment Fund (LAIF) that is regulated by the California Government Code under the oversight of the Treasurer of the State of California. The fair value of the City's investment in this pool is reported in the accompanying financial statements at amounts based upon the City's pro-rata share of the fair value provided by LAIF for the entire LAW portfolio (in relations to the amortized cost of that portfolio). The balance available for withdrawal is based on the accounting records maintained by LAIF, which are recorded on an amortized cost basis. 49 >. �� 174 CITY OF LA QUINTA NOTES TO FINANCIAL STATEMENTS (CONTINUED) JUNE 30, 2012 Note 3: Cash and Investments (Continued) GASB Statement No. 31 The City adopted GASB Statement No. 31, Accounting and Financial Reporting for Certain Investments and for External Investment Pools, as of July 1, 1997. GASB Statement No. 31 establishes fair value standards (e.g. mark to market) for investments in participating interest earning investment contracts, external investment pools, equity securities, option contracts, stock warrants and stock rights that have readily determinable fair values. Accordingly, the City reports its investments at fair value in the balance sheet. All investment income, including changes in the fair value of investments, is recognized as revenue in the operating statement. Note 4: Property Taxes Under California law, property taxes are assessed and collected by the counties up to 1 % of assessed value, plus other increases approved by the voters. The property taxes are recorded initially in a pool, and are then allocated to the cities based on complex formulas. Accordingly, the City of La Quinta accrues only those taxes that are received from the County within ninety days after year-end. Lien date January 1 Levy date July 1 Due dates November 1 and February 1 Collection dates December 10 and April 10 Note 5: Notes Receivable In September 1994, the Agency sold certain real property to LINC Housing for $2,112,847. The property was used to construct single-family homes and rental units to increase the City's supply of low and moderate income housing. The note bears interest at 6% per annum and is due in full on June 15, 2029. On February 1, 2012, this receivable was transferred to the Housing Authority Project Area No. 1 which took over the housing function of the Agency upon dissolution. The balance at June 30, 2012, including matured, unpaid interest of $2,045,041is $4,080,429. In February 2011, the Agency entered into Disposition and Development Agreement with Coral Mountain Partners L.P. ("Coral Mountain") to fund up to $29,000,000 for the construction of a low and moderate income apartment complex with an estimated completion date of the apartment complex of March 2015. The Agency's $29,000,000 loan is evidenced by a Promissory Note executed by Coral Mountain ("Note"). Interest on the outstanding note amount will bear simple interest of 1%. Principal and interest will be repaid on or before May 1" of each year from annual residual receipts as defined in the Note once the project is completed and may be repaid early if the property is refinanced, or if the property is transferred to another entity. On February 1, 2012 this receivable was transferred to the Housing Authority Project Area No. 2 which took over the housing function of the Agency upon dissolution. As of June 30, 2012, the outstanding principal portion on the Note is $3,852,309 and the outstanding interest portion is $15,401. Other notes receivable as of February 1, 2012 were transferred to the Housing Authority Project Area No. 1 which took over the housing function of the Agency upon dissolution that totaled $30,222 at June 30, 2012. 50 175 CITY OF LA QUINTA NOTES TO FINANCIAL STATEMENTS (CONTINUED) JUNE 30, 2012 Note 6: Capital Assets Capital asset activity for governmental activities for the year ended June 30, 2012, is as follows: Beginning Ending Balance at Balance at July 1, 2011 Additions Deletions Transfers June 30, 2012 Governmental Activities: Capital assets, not being depreciated: Land $ 68,139,567 $ - $ 175,000 $ 1,664,118 $ 69,628,685 Right of way 284,904,621 - - - 284,904,621 Construction -in -progress 11,946,973 13,119,645 1,516,216 (8,356,856) 15,193,546 Total Capital Assets, Not Being Depreciated 364,991,161 13,119,645 1,691,216 (6,692,738) 369,726,852 Capital assets, being depreciated: - Buildings and improvements 69,282,702 - 1,151,129 1,016,140 69,147,713 Equipment and furniture 2,260,348 37,225 18,981 20,000 2,298,592 Vehicles 1,656,948 27,810 86,220 - 1,598,538 Infrastructure 189,478,798 2,135,799 127,007 5,656,598 197,144,188 Total Capital Assets, Being Depreciated 262,678,796 2,200,834 1,383,337 6,692,738 270,189,031 Less accumulated depreciation: Buildings and improvements 16,594,555 2,350,684 54,675 - 18,890,564 Equipment and furniture 1,526,856 178,583 18,981 - 1,686,458 Vehicles ' 1,233,867 122,017 86,220 - 1,269,664 Infrastructure 77,601,157 6,206,568 127,007 - 83,680,718 Total Accumulated Depreciation Total Capital Assets, Being Depreciated, Net Governmental Activities Capital Assets, Net 96,956,435 8,857,852 286,883 - 105,527,404 165,722,361 (6,657,018) 1,096,454 6,692,738 164,661,627 $ 530,713,522 $ 6,462,627 $ 2.787,670 $ - $ 534,388,479 Depreciation expense was charged to the following functions in the Statement of Activities: General government $ 128,315 Public safety 1,178,150 Community services 500,509 Public works 7,050,878 Total governmental activities $ 8,857,852 51 176 CITY OF LA QUINTA NOTES TO FINANCIAL STATEMENTS (CONTINUED) JUNE 30, 2012 Note 6: Capital Assets (Continued) Capital asset activity for business -type activities for the year ended June 30, 2012, is as follows: Beginning Ending Balance at Balance at July 1, 2011 Additions Deletions June 30, 2012 Business -Type Activities: Capital assets, not being depreciated: Land $ 36,840,832 $ - $ - $ 36,840,832 Total Capital Assets, Not Being Depreciated Capital assets, being depreciated: Buildings and improvements Equipment and furniture Vehicles Software Total Capital Assets, Being Depreciated Less accumulated depreciation: Buildings and improvements Equipment and fumiture Vehicles Software Total Accumulated Depreciation Total Capital Assets, Being Depreciated, Net Governmental Activities Capital Assets, Net 36,840,832 6,636,465 2,073,478 20,348 20,255 8,750,546 - 36,840,832 6,636,465 2,073,478 20,348 20,255 8,750,546 1,507,198 234,555 - 1,741,753 1,266,430 267,826 - 1,534,256 20,347 - - 20,347 20,255 - - 20,255 2,814,230 502,381 - 3,316,611 5,936,316 (502,381) - 5,433,935 $ 42,777,148 $ (502,381) $ - $ 42,274,767 Depreciation expense was charged to the following function in the Statement of Activities: Golf Course $ 502,381 52 CITY OF LA QUINTA NOTES TO FINANCIAL STATEMENTS (CONTINUED) JUNE 30, 2012 Note 7: Changes in Long -Term Liabilities — Governmental Activities a. Changes in Long -Term Debt The following is a summary of changes in governmental long-term liabilities of the City for the fiscal year ended June 30, 2012: Transfers to Balance at Successor Balance at Due vdthin July 1, 2011 Additions Deletions Agency' June 30, 2012 one year City: Compensated absences payable $ 965,921 $ 775,985 $ 799,952 $ - $ 941,954 $ 799,952 Copier Lease Payable 78,252 - 38,164 - 40,088 40,088 OPEB Liability 337,311 122,333 - 459,644 - General liability retrospective deposit payable - 41,298 - - 41,298 - Redevelopment Agency RDA Project Area No. 1: Tax allocation bonds 126,925,000 - 3,540,000 (123,385,000) - - Pass -through agreements: Coachella Valley Unified School District 1,255,242 - 1,255,242 - - - RDA Project Area No. 2: Tax allocation bonds 11,555,000 - 130,000 (11,425,000) - - Due to County of Riverside 1,000,000 - 1,000,000 - - - Provident Loan 1,503,433 - 17,148 (1,486,285) - - US Department of Agriculture 729,383 - 7,337 (722,046) - - Financing Authority: Revenue bonds 114,340,000 - 2,250,000 (108,195,000) 3,895,000 470,000 Unamonaed premiums/discounts (1,127,045) 33,293 3,280 1,097,032 - - Total $ 257,562,497 $ 972,909 $ 9,041,123 $ (244,116,299) $ 5,377,984 $1,310,040 ' As a result of the dissolution of the redevelopment agency, indebtedness of the former redevelopment agency was transferred to the Successor Agency. See Note 22 for disclosures for indebtedness. As a result of the dissoullion of the redevelopment agency, amounts due to the County and for pass -through agreements were transferred to the County and therefore the obligation has been included above as a deletion in the amount of $1,171,165. b. A description of individual issues of debt (excluding defeased bonds) outstanding as of June 30, 2012, is as follows: Copier Lease Payable In June 2008, the City entered into a 5-year lease agreement for photocopiers for $182,094 maturing in monthly increments ranging from $2,682 in July 2008 to $3,417 in June 2013, with interest payable monthly at 4.93%. This lease agreement qualifies as a capital lease for accounting purposes and therefore, has been recorded at the present value of the future minimum lease payments at the inception date. 53 1 if 118 CITY OF LA QUINTA NOTES TO FINANCIAL STATEMENTS (CONTINUED) JUNE 30, 2012 Note 7: Changes in Long -Term Liabilities — Governmental Activities (Continued) The minimum future lease obligations and the net present value of the lease payments as of June 30, 2012, are as follows: Year Ending June 30, Total 2013 $ 44,358 Total Payments 44,358 Less amount representing sales tax (3,034) Less amount representing interest (1,236) Outstanding Principal $ 40,088 1996 Lease Revenue Refunding Bonds On November 15, 1996, the Authority issued $8,790,000 of 1996 Lease Revenue Refunding Bonds to defease the remaining 1991 Local Agency Revenue Bonds in the amount of $8,200,000 and to provide funds for construction of remaining improvements to the La Quinta Civic Center site. The bonds consist of $3,630,000 of serial bonds and $5,150,000 of term bonds. The serial bonds will accrue interest at rates between 3.70% and 5.30% and principal amounts mature between October 1, 1997 and October 1, 2008, in amounts ranging from $285,000 to $380,000. The term bonds accrue interest at a rate of 5.55% and mature on October 1, 2018. A surety agreement has been purchased to satisfy the bond reserve requirement. There are certain limitations regarding the issuance of parity debt as further described in the official statement. The amount of principal outstanding at June 30, 2012, is $3,895,000. The minimum annual requirements to amortize the bond payable as of June 30, 2012, are as follows: Principal Interest 2013 $ 470,000 $ 203,130 2014 495,000 176,351 2015 525,000 148,046 2016 555,000 118,076 2017 585,000 86,441 2018-2022 1,265,000 71,179 Totals $ 3,895,000 $ 803,223 54 1 179 CITY OF LA QUINTA NOTES TO FINANCIAL STATEMENTS (CONTINUED) JUNE 30, 2012 Note 7: Changes in Long -Term Liabilities — Governmental Activities (Continued) Pass -through Agreements Payable - Coachella Valley Unified School District An agreement was entered into in 1991 between the former redevelopment agency, the City of La Quints and the Coachella Valley Unified School District (District), which provides for the payment to the District a portion of tax increment revenue associated with properties within District confines. Such payments are subordinate to other indebtedness of the former redevelopment agency incurred in furtherance of the Redevelopment Plan for Project Area No. 1. This tax increment is paid to the District over a payment schedule through August 1, 2012, in amounts ranging from $421,168 to $834,076, for a total amount of $15,284,042. Due to the dissolution of the former redevelopment agency of the City of La Quinta this debt has been transferred to the County of Riverside due to no future Tax increment payments. There is no outstanding balance at June 30, 2012 Due to County of Riverside - Project Area No. 2 Based on an agreement dated July 5, 1989, between the former redevelopment agency and the County of Riverside, until the tax increment reaches $5,000,000 annually in Project Area No. 2, the Agency will pay to the County 50% of the County portion of tax increment. At the County's option, the County's pass -through portion can be retained by the Agency to finance new County facilities or land costs that benefit the County and serve the La Quinta population. Due to the dissolution of the former redevelopment agency of the City of La Quinta this debt has been transferred to the County of Riverside due to no future Tax increment payments. There is no outstanding balance at June 30, 2012 CJPIA Retrospective Deposit Liability Retrospective deposits and refunds are cost allocation adjustments to prior coverage periods. Some claims take many years to resolve and over time their estimated value changes. The retrospective adjustments are calculated annually and take into consideration all the changes in claim values that occurred during the most recent year. The formula is designed to adequately cover the cost of claims brought against members and to ensure the overall financial strength and security of the Authority. The formula was developed to be as equitable as possible by taking into consideration both risk exposure and claims experience of individual members. CJPIA has temporarily deferred the payment on retrospective deposits owed to the Authority by members. The payment deferral period extends until July 1, 2013 for the Liability program and July 1, 2015 for the Workers' Compensation program. Retrospective deposit payments are scheduled to resume on these dates. The October 2011 annual retrospective adjustment is included in these balances Optional Payment Plans When retrospective deposit payments resume as indicated above, members will have the opportunity to select from a variety of optional payment plans. Discounts under the incentive plan are available to members choosing to voluntarily accelerate payment during the deferral period. The City has chosen not to voluntarily accelerate payment at this time. After the deferral period, members choosing from among the optional payment plans will be subject to a moderate annual fee. The fee is intended to provide a means for the Authority to recover otherwise foregone investment earnings and to serve as a minor disincentive for the selection of longer financing terms. 55 1 180 CITY OF LA QUINTA NOTES TO FINANCIAL STATEMENTS (CONTINUED) JUNE 30, 2012 Note 7: Changes in Long -Term Liabilities — Governmental Activities (Continued) Retrospective Balances will Change Annually Retrospective balances will change with each annual computation during the payment deferral period. Member balances may increase or decrease as a result of the most recent year's claim development. Accordingly, some members who chose to pay off their balance in full may be required to pay additional retrospective deposits in the future based on the outcome of actual claim development reflected in subsequent retrospective deposit computations. Conversely, if claim development is favorable then subsequent retrospective adjustments could potentially result in refunds to the member. More information on the CJPIA retrospective balances can be found on the CJPIA website at CJPIA.org. At June 30, 2012 the retrospective amount due was $41,298. Note 8: Changes in Long -Term Liabilities — Business -type Activities Changes in business -type long-term liabilities for the year ended June 30, 2012, were as follows: Balance at Balance at Due within July 1, 2011 Additions Deletions June 30, 2012 one year Golf Course: Capital leases payable $ 286,097 $ - $ 117,013 $ 169,084 $ 125,348 The City of La Quinta entered into several capital lease agreements for the operation of the Silver Rock Golf Resort. These lease agreements qualify as capital leases for accounting purposes and, therefore, have been recorded at the present value of their future minimum lease payments as of the inception date. Obligations under capital leases are as follows: Wells Fargo Financial Leasing, Inc. The present value of the minimum lease payments on golf carts was capitalized using an incremental borrowing rate of 6.90% at the inception of the lease. The lease is payable in 33 monthly installments of $11,166 which began February 1, 2011. $ 169,684 Total capital leases payable as of June 30, 2012 $ 169,084 56 181 CITY OF LA QUINTA NOTES TO FINANCIAL STATEMENTS (CONTINUED) JUNE 30, 2012 Note 8: Changes in Long -Term Liabilities — Business -type Activities (Continued) The following schedule summarizes the debt to maturity payments for capital leases: Year Ending June 30, Total 2013 $ 133,100 . 2014 44,366 Total Payments 177,466 Less Amount Representing Interest (8,382) Outstanding Principal $ 169,084 Note 9: Debt Without Governmental Commitment The City of La Quinta sold Improvement Bonds issued pursuant to the California State Improvement Act of 1915. The Bonds are payable from the annual installments collected on the regular property tax bills sent to owners of property having unpaid assessments levied against land benefited by the projects. The bonds are neither general obligations of the City nor any other political subdivision and the full faith and credit of the City is not pledged for repayment thereof, therefore, they are not included in the long-term liabilities in the accompanying financial statements. The City is not liable for repayment of the debt, but is only acting as agent for the property owners in collecting the assessments and forwarding the collections to bondholders. The following is a summary of Improvement Bonds outstanding at June 30, 2012. Amount Outstanding at Proceeds Maturity Date Interest Rate June 30, 2012 Assessment District No. 97-1 $ 705,262 9/2/2018 4.10%- 5.20% $ 275,000 Assessment District No.2001-1 2,285,000 9/2/2015 5.00%-6.60% 465,000 Note 10: Interfund Receivables and Payables The composition of current interfund receivable and payable as of June 30, 2012, are as follows: Due to Other Funds Non -Major Governmental Total Due From Other Funds General Fund $ 14,174 $ 14,174 Total: $ 14.174 $ 14,174 57 182 CITY OF LA QUINTA NOTES TO FINANCIAL STATEMENTS (CONTINUED) JUNE 30, 2012 Note 10: Interfund Receivables and Payables (Continued) The interfund balances were made to cover negative cash balances and other temporary loans at June 30, 2012. The composition of non -current interfund receivable and payable as of June 30, 2012, are as follows: Advances From Other Funds RDAPA#1 RDA PA#2 Non -Major Civic Center Debt Service Debt Service Golf Course Governmental TOTAL Advances to Other Funds General Fund $ 7,169,490 $ - $ - $ 5,313,025 $ 2,935,414 $ 15,417,929 a) As of June 30, 2012, the General Fund has advanced to the Golf Course fund $5,313,025. The advances accrue interest at the City's investment pool rate and are to be repaid by the golf course out of future profits. b) In September 2006, an advance up to $9,615,094 for the City Hall expansion from the General Fund to the Civic Center Developer Impact Fee Fund was approved. As of June 30, 2012, the Civic Center expansion was completed and the amount of the advance was $7,169,490 outstanding. The advance accrues interest that would have been earned by the Local Agency Investment Fund. c) In October 2009, an advance up to $2,033,687 for the Phase 1 of the Corporate Yard from the General Fund to the Street and Park Maintenance Facility Funds was approved. As of June 30, 2012, the amount of the outstanding advance was $2,021,772. The advance accrues interest at the earnings rate of the City's investment pool fund. d) In February 2003, the Redevelopment Agency Capital Projects PA No. 2 Fund advanced $1,350,131 to the Fire Facility Fund to provide funding for development of the City's north Fire Station. On March 1, 2012 the outstanding advance of $925,192 was transferred from the Redevelopment Agency to the General Fund with the Redevelopment Agency receiving $925,192 in cash for the outstanding balance. The advance accrues interest equal to the earnings rate of the City's Investment Pool Funds. As of June 30, 2012, the remaining balance of the advance is $ 913,642. Note 11: Interfund Transfers Transfers Out Capital RDA PA#1 Non -Major General Fund Improvement Debt Service Governmental Total TransfersIn General Fund $ - $ - $ - $ 411,105 $ 411,105 Capital Improvement 1,356,275 - 488,652 7,549,448 9,394,375 Non -Major Governmental 2,000 47,130 - 2,700,142 2,749,272 Internal Service - - - 25,368 25,368 Total: $ 1,358,275 $ 47,130 $ 488,652 $ 10,686,063 $ 12,580,120 58 ev 183 CITY OF LA QUINTA NOTES TO FINANCIAL STATEMENTS (CONTINUED) JUNE 30, 2012 Note 11: Interfund Transfers (Continued) a) $411,105 was transferred to the General Fund from various non -major funds to fund various program expenses within the City related to operations and grant funded activities. b) $1,356,275 was transferred from the General Fund to the Capital Improvement Fund to transfer various capital projects and sales tax rebate agreements. c) $488,652 was transferred to the Capital Improvement Fund from the RDA Debt Service — PA No. 1 Fund to fund various capital projects within the project area of the former redevelopment agency. d) $7,549,448 was transferred to Capital Improvement Fund from various non -major funds to fund various capital projects within the City. e) A combined $2,749,272 was transferred to various non -major funds from the General Fund, Capital Improvement, and other non -major funds to support various administrative operations, capital project, and debt service expenses within the City. f) $25,368 was transferred to the internal service funds to support City-wide equipment replacement expenses. Note 12: Long-term Receivable Retrospective deposits and refunds are cost allocation adjustments to prior coverage periods. Some claims take many years to resolve and over time their estimated value changes. The retrospective adjustments are calculated annually and take into consideration all the changes in claim values that occurred during the most recent year. The formula is designed to adequately cover the cost of claims brought against members and to ensure the overall financial strength and security of the Authority. The formula was developed to be as equitable as possible by taking into consideration both risk exposure and claims experience of individual members. CJPIA has temporarily deferred the payment on retrospective deposits owed to the Authority by members. The payment deferral period extends until July 1, 2013 for the Liability program and July 1, 2015 for the Workers' Compensation program. Retrospective deposit payments are scheduled to resume on these dates. The October 2011 annual retrospective adjustment is included in these balances. The City at June 30, 2012 had a retrospective refund due to the City in the amount of $257,885. During the payment deferral period, members with a retrospective refund balance will receive a portion of the balance as a credit against other charges on the annual contribution invoice. For the 2011-12 coverage year, the refund amount will be 25%. The percentage to be refunded in future years will be set on an annual basis by the Executive Committee of CJPIA. Once the payment deferral period has concluded in each program, subsequent retrospective refund adjustments will be applied in full (100%) as a credit on the annual contribution invoice. More information on the CJPIA retrospective balances can be found on the CJPIA website at CJPIA.org. 59 " " 184 CITY OF LA QUINTA NOTES TO FINANCIAL STATEMENTS (CONTINUED) JUNE 30, 2012 IV. OTHER INFORMATION Note 13: Defined Benefit Pension Plan Plan Description The City of La Quinta contributes to the California Public Employees Retirement System (PERS), a cost sharing multiple -employer public employee defined benefit pension plan. PERS provides retirement and disability benefits, annual cost -of -living adjustments and death benefits to plan members and beneficiaries. PERS acts as a common investment and administrative agent for participating public entities within the State of California. Benefit provisions and all other requirements are established by State statute and City ordinance. Copies of PERS' annual financial report may be obtained from their executive office: 400 P Street, Sacramento, CA 95814. Fundino Policy Participants are required to contribute 8% of their annual covered salary. The City makes the contributions required of City employees on their behalf and for their account. The City is required to contribute at an actuarially determined rate; the current rate is 10.263% of annual covered payroll. The contribution requirements of plan members and the City are established and may be amended by PERS. The contribution requirement of plan member and the City are established and may be amended by CalPERS. Contributions For the year ended June 30, 2012, the City's contribution of $816,449 was equal to the City's required and actual contribution. The required contribution was determined as part of the June 30, 2009, actuarial valuation using the entry age normal actuarial cost method. The actuarial assumptions included (a) 7.75% investment rate of return (net of administrative expenses) and (b) projected annual salary increases that range from 3.55% to 14.45% depending on age, service, and type of employment. Both (a) and (b) include inflation component of 3%. The actuarial value of PERS assets was determined using techniques that smooth the effects of short-term volatility in the market value of investments over a three- year period. PERS unfunded actuarial accrued liability (or surplus) is being amortized as a level percentage of projected payroll on a closed basis. The remaining amortization period at June 30, 2009 was 19 years. Three -Year Trend Information for PERS Required Percentage Fiscal Year Contribution Contributed 6/30/2010 $ 953,728 100% 6/30/2011 714,598 100% 6/30/2012 816,449 100% rn 185 CITY OF LA QUINTA NOTES TO FINANCIAL STATEMENTS (CONTINUED) JUNE 30, 2012 Note 14: Defined Contribution Plans Plan Description The Supplemental Pension Savings Plan is a defined contribution pension plan established by the City to provide retirement excess benefits to general employees of the City. At June 30, 2012, there was one plan member. There are no required contributions by plan members. At June 30, 2012, the City has contributed $200,054 to fund the Supplemental Pension Savings Plan. Note 15: Post -Employment Health Benefits Plan Description The City of La Quinta provides other postemployment benefits (OPEB) through a single - employer defined benefit healthcare plan by contributing on behalf of all eligible retirees' $108/month for calendar 2011 and $112/month for calendar 2012, increased in all future years according to the rate of medical inflation. These benefits are provided per contract between the City and the employee associations. A separate financial report is not available for the plan. Funding Policy The contribution requirements of plan members and the City are established and may be amended by the City, City Council and/or the employee association. Currently, contributions are not required from plan members. There was no contribution made during the 2011-2012 fiscal year to cover current plan premiums. As a result, the City calculated and recorded a net OPEB obligation, representing the difference between the annual required contribution (ARC) and actual contributions, as presented below: Annual required contribution (ARC) $ 138,992 Interest on net OPEB obligation 3,373 Adjustment to ARC (13,872) Annual OPEB cost 128,493 Contributions made (6,160) (Decrease) increase in net OPEB obligation 122,333 Net OPEB obligation (asset) - beginning of year 337,311 Net OPEB obligation (asset) - end of year $ 459,644 61 "'" 186 CITY OF LA QUINTA NOTES TO FINANCIAL STATEMENTS (CONTINUED) JUNE 30, 2012 Note 15: Post -Employment Health Benefits (Continued) The City's annual OPEB cost, the percentage of annual OPEB cost contributed to the plan and the net OPEB obligation for 2011-2012 and the two preceding years were as follows: Actual Percentage Fiscal Annual Contribution of Annual Net OPEB Year OPEB (Net of OPEB Cost Obligation End Cost Adjustments) Contributed (Asset) 6/3012010 $ 116,821 $ 3,513 3.01% $ 222,466 6/30/2011 119,105 4,260 3.58% 337,311 6/30/2012 128,493 6,160 4.79% 449,145 Funded Status and Funding Progress Actuarial valuations of an ongoing plan involve estimates of the value of reported amounts and assumptions about the probability of occurrence of events far into the future. Examples include assumptions about future employment, mortality, and the healthcare cost trend. Amounts determined regarding the funded status of the plan and the annual required contributions of the City are subject to continual revision as actual results are compared with past expectations and new estimates are made about the future. The schedule of funding progress below presents multiyear trend information about whether the actuarial value of plan assets is increasing or decreasing over time relative to the actuarial accrued liabilities for benefits. The information is as of the latest actuarial valuation information available. Actuarial Actuarial Actuarial Actuarial Percent of Type of Valuation Value of Accrued Accrued Funded Covered Covered Interest Valuation Date Assets Liability Liability Ratio Payroll Payroll Rate Actual 7/1/2008 $ - $ 590,676 $ 590,676 0.0% $ 7,621,474 7.6% 5.00% Actual 7/1/2011 - 428,328 428,328 0.0% 7,459,445 5.7% 5.00% Actuarial Methods and Assumptions Projections of benefits for financial reporting purposes are based on the substantive plan (the plan as understood by the employer and the plan members) and include the types of benefits provided at the time of each valuation and the historical pattern of sharing of benefit costs between the employer and plan members to that point. The required contribution was determined as part of the July 1, 2011, actuarial valuation using the entry age actuarial cost method. The actuarial assumptions included a 5.0% investment rate of return, projected salary increases ranging from 5.0% to 8.0%, a 4.0% per year cost -of -living adjustments. Both include an inflation component of 4%. The actuarial value of assets is set equal to the reported market value of assets. The UAAL is being amortized as a level dollar on an open basis. The remaining amortization period at June 30, 2012, was twenty-seven years. The number of active participants is 12. 62 �- 187 CITY OF LA QUINTA NOTES TO FINANCIAL STATEMENTS (CONTINUED) JUNE 30, 2012 Note 16: Self Insurance The City is a member of the California Joint Powers Insurance Authority (Insurance Authority). The Insurance Authority is composed of 121 California public entities and is organized under a joint powers agreement pursuant to California Government Code §6500 at seq. The purpose of the Insurance Authority is to arrange and administer programs for the pooling of self -insured losses, to purchase excess insurance or reinsurance, and to arrange for group purchased insurance for property and other coverages. The Insurance Authority's pool began covering claims of its members in 1978. Each member government has an elected official as its representative on the Board of Directors. The Board operates through a 9-member Executive Committee. General Liability In the liability program claims are pooled separately between police and non -police exposures. (1) The payroll of each member is evaluated relative to the payroll of other members. A variable credibility factor is determined for each member, which establishes the weight applied to payroll and the weight applied to losses within the formula. (2) The first layer of losses includes incurred costs up to $30,000 for each occurrence and is evaluated as a percentage of the pool's total incurred costs within the first layer. (3) The second layer of losses includes incurred costs from $30,000 to $750,000 for each occurrence and is evaluated as a percentage of the pool's total incurred costs within the second layer. (4) Incurred costs in excess of $750,000 up to the reinsurance attachment point of $5 million are distributed based on the outcome of cost allocation within the first and second loss layers. (5) Costs of covered claims from $5 million to $10 million are paid under a reinsurance contract subject to a $2.5 million annual aggregate deductible. Costs of covered claims from $10 million to $15 million are paid under two reinsurance contracts subject to a combined $3 million annual aggregate deductible. On a cumulative basis for all 2011-2012 reinsurance contracts the annual aggregate deductible is $5.5 million. (6) Costs of covered claims from $15 million up to $50 million are covered through excess insurance policies. The overall coverage limit for each member including all layers of coverage is $50 million per occurrence. Costs of covered claims for subsidence losses are paid by reinsurance and excess insurance with a pooled sub -limit of $35 million per occurrence. This $35 million subsidence sub -limit is composed of (a) $5 million retained within the pool's SIR, (b) $10 million in reinsurance and (c) $20 million in excess insurance. The excess insurance layer has a $20 million annual aggregate. Workers Compensation In the workers' compensation program claims are pooled separately between public safety (police and fire) and non-public safety exposures. (1) The payroll of each member is evaluated relative to the payroll of other members. A variable credibility factor is determined for each member, which establishes the weight applied to payroll and the weight applied to losses within the formula. (2) The first layer of losses includes incurred costs up to $50,000 for each occurrence and is evaluated as a percentage of the pool's total incurred costs within the first layer. (3) The second layer of losses includes incurred costs from $50,000 to $100,000 for each occurrence and is evaluated as a percentage of the pool's total incurred costs within the second layer. (4) Incurred costs in excess of $100,000 up to the reinsurance attachment point of $2 million are distributed based on 63 n. 188 CITY OF LA QUINTA NOTES TO FINANCIAL STATEMENTS (CONTINUED) JUNE 30, 2012 Note 16: Self Insurance (Continued) the outcome of cost allocation within the first and second loss layers. (5) Costs of covered claims from $2 million up to statutory limits are paid under a reinsurance policy. Protection is provided per statutory liability under California Workers' Compensation Law. Employer's Liability losses are pooled among members to $2 million. Coverage from $2 million to $4 million is purchased as part of a reinsurance policy, and Employers Liability losses from $4 million to $10 million are pooled among members. During the past three fiscal years, none of the above programs of protection experienced settlements or judgments that exceeded pooled or insured coverage. There were also no significant reductions in pooled or insured liability coverage in 2011-2012. Additional Coverage In addition to coverage with the Authority, the City also carries additional coverage for earthquake & flood and real and personal property with Pacific Insurance Co. Coverage is $5,000,000 with a 10% deductible subject to a minimum of $25,000. The total insured value of real and personal property is $20,000,000. An excess earthquake & flood and real and personal property policy is held with Endurance American Specialty Insurance Company. Coverage is $2,500,000 in excess of the $5,000,000 covered by the primary policy. Employee dishonesty, forgery and computer fraud insurance is held with Hartford Insurance Company. Coverage is $1,000,000 with a $5,000 deductible. All risk property insurance, including auto physical damage is held with Lexington Insurance Company. Coverage is up to $10,000,000 per occurrence with various sublimits depending on the property. The total insured value of real and personal property is $65,426,900. During the past three fiscal years none of the above programs of protection have had settlements or judgments that exceed pooled or insured coverage. There have been no significant reductions in pooled or insured liability coverage from coverage in the prior year. Note 17: Commitments and Contingencies The following material construction commitments existed at June 30, 2012: Expenditures to date as of Remaining Project Name Contract Amount June 30, 2012 Commitments Washington St Apartments Rehabilitation $ 18,906,474 $ 385,560 $ 18,520,914 Adams Street Bridge Improvements 13,088,121 4,536,166 8,551,955 Note 18: Fund Balances The City has the following committed fund balance shown on the balance sheet: Committed to emergency reserve - the City established the amount of 35% of the Fiscal Year 2011-2012 budget plus $4,000,000 which totals $17,516,295 in the General Fund for the year ended June 30, 2012. The funds would be drawn upon pursuant to the Municipal Code Section 2.20 which defines an emergency or disaster to mean the actual or threatened existence of conditions of disaster or of extreme peril to the safety of 64 n- 189 CITY OF LA QUINTA NOTES TO FINANCIAL STATEMENTS (CONTINUED) JUNE 30, 2012 Note 18: Fund Balances (Continued) persons and property within this city caused by such conditions as air pollution, fire, flood, storm, epidemic, riot, earthquake or other conditions, including conditions resulting from war or imminent threat of war but other than conditions resulting from a labor controversy, which conditions are or are likely to be beyond the control of the services, regular personnel, equipment and facilities of the city and which may require the combined forces of other political jurisdictions to combat. Committed to post retirement health benefits - the City has committed a portion of fund balance for the payment in future years of their Post retirement health benefits. For the year ended June 30, 2012 the City has committed $1,523,401 for this purpose. These committed amounts have been approved by Council based on certain percentages and will be used only in the event of Council approval. Additionally, the City has included the following amounts in the unassigned fund balance amount shown on the balance sheet, Cash Flow Reserve - the City established the amount of 8.25% of the Fiscal Year 2011-2012 budget which totals $3,185,984 in the General Fund for the year ended June 30, 2012. Future Operational Deficit - For the future operational deficit, the City has set aside $3,184,702 for the year ended June 30, 2012. Note 19: Golf Course Management Agreement The City entered into an agreement with Landmark Golf Management LLC (operator) to manage the golf operations at the city -owned SilverRock Golf Course. The Agreement entered into on April 6, 2004, sets forth a five year term commencing upon the completion of the golf course. On January 14, 2005, the golf course was deemed to be complete and management was turned over to the operator. The contract provides that the operator will manage the day to day operations, hire employees, provide golf pro shop and food services, manage all marketing and promotional activities, prepare the annual budget report for Council consideration, and manage accounting and payroll functions. In addition to the annual payment for management services, the City has advanced the operator $250,000 to pay for golf course expenses. Twice a month the operator submits a request for reimbursement to the City to replenish the City's advance. In addition, the agreement sets forth the establishment of a capital reserve fund of 2% of green fees. For the fiscal year ending June 30, 2012, the Golf Course had an operating loss before contributions and transfers of $212,309. Note 20: Reimbursement Agreements The City entered into a transient occupancy tax (TOT) revenue reimbursement agreement on August 31, 2006, with Village Resort LLC, the owner of an Embassy Suites Hotel. The hotel owner is required to remit on a monthly basis any TOT collected to the City, thirty days after each month. Under terms of the agreement, the City shall make quarterly payments of 40% of any TOT generated from the Hotel in an amount not to exceed $1,000,000 over a five year period. The agreement terminates when either the $1,000,000 limit is reached or in 5 years whichever comes first. On January 17, 2012, the City amended the agreement to extend the termination date by an additional one year period, subject to the $1,000,000 maximum reimbursement. In addition, the hotel may not assign or transfer this agreement 65 CITY OF LA QUINTA NOTES TO FINANCIAL STATEMENTS (CONTINUED) JUNE 30, 2012 Note 20: Reimbursement Agreements (Continued) without the City's prior written consent, which it may withhold at its discretion. The hotel opened in November 2006. As of June 30, 2012, the City made $967,744 in reimbursement payments to the owner leaving an outstanding balance of $32,256. The City entered into a sales tax sharing agreement on January 30, 2006, with Costco Wholesale Corporation. Under the terms of the agreement the City shall make quarterly payments of 40% of any sales tax generated from Costco in an amount not to exceed $4,000,000 over a ten year period. Due to the reporting of sales tax information by the State Board of Equalization to the City, the reimbursement payments by the City will lag by one quarter. The agreement terminates when either the $4,000,000 limit is reached or in 10 years whichever comes first. The Costco business opened in November 2006. As of June 30, 2012, the City made $1,709,264 in reimbursement payments to the owner leaving an outstanding balance of $2,290,736. Note 21: California Redevelopment Agency Dissolution On July 18, 2011, the California Redevelopment Association ("CRA") and the League of California Cities ("League") filed a petition for writ of mandate with the California Supreme Court, requesting the Court to declare unconstitutional two bills that were passed as part of the 2011-12 State Budget, AB 1X 26 and 27 (California Redevelopment Association v. Matosantos). AB 1X 26 dissolves redevelopment agencies effective October 1, 2011. AB 1X 27 gave redevelopment agencies an option to avoid dissolution if it commits to making defined payments for the benefit of the State, school districts and certain special districts. In 2011-12, these payments amounted to a state-wide total of $1.7 billion. In 2012-13 and subsequent years, the payments totaled $400 million, annually. Each city or county's share of these payments was determined based on its proportionate share of state-wide tax increment. On August 17, 2011 the Supreme Court issued a stay of the implementation of AB 1X 26 and 27 which allowed a redevelopment agency to continue if it adopted an AB 1X 27 ordinance. However, because of the effect of the stay order, the authority for the Redevelopment Agency to engage in most activities was suspended. The Supreme Court heard oral arguments on November 10, 2011 and on. December 29, 2011 announced its decision in California Redevelopment Association v. Matosantos. The court upheld AB 1X 26 which dissolves redevelopment agencies, but invalidated in its entirety AB 1X 27 which allowed redevelopment agencies to continue as long as they made the required payments. AB X1 26 established deadlines for the process of Redevelopment Agency dissolution and the handling of existing obligations. The full text of AB 1X 26 may be obtained from the California legislative information website maintained by the Legislative Counsel of the State of California at: htto //www leainfo ca gov/bilinfo html. As of January 31, 2012, the Redevelopment Agency has been dissolved and the City of La Quinta has elected to become the Successor Agency. The Successor Agency will be responsible for winding down the remaining activities of the dissolved Redevelopment Agency. Note 22: Subsequent Event Orders from California State Controller On April 20, 2012, pursuant to Health and Safety Code Section 34167.5, the California State Controller issued an order to cities, counties, and agencies, directly or indirectly receiving 191 M CITY OF LA QUINTA NOTES TO FINANCIAL STATEMENTS (CONTINUED) JUNE 30, 2012 Note 22: Subsequent Event (Continued) assets from a redevelopment agency after January 1, 2011, to reverse the transfer and return assets to successor agency. The California State Controller will specifically review and audit cities, counties, and public agencies to ensure that all applicable asset transfers have been reversed. Any reversals of transfers are not reflected in the Agency's financial statements as of January 31, 2012. Upon the Controller's review, any assets, if applicable, would be transferred to the Successor Agency in accordance with the order. On October 2, 2012, the City adopted resolution no. 2012-053 to transfer ownership of ten public/government use, non -housing properties to the successor agency, which were previously transferred to the City during the time period January 1, 2011 and June 30, 2011 for no compensation. Assembly Bill 1484 Assembly Bill 1484 established a requirement for the successor agency to remit to the County auditor -controller three payments as determined by the auditor -controller which consist of a payment to be made in July 2012 for taxing entities' share of December 2011 property tax distribution to redevelopment agency/successor agency, a payment to be made in November 2012 related to Low -Moderate Income Housing Fund, and a payment to be made in April 2013 for unencumbered cash. As of the date of the report no payment in July 2012 was required and the future amounts due have not been determined by the auditor - controller. Note 23: Successor Agency Trust for Assets of Former Redevelopment Agency On December 29, 2011, the California Supreme Court upheld Assembly Bill 1X 26 ("the Bill") that provides for the dissolution of all redevelopment agencies in the State of California. This action impacted the reporting entity of the City of La Quinta that previously had reported a redevelopment agency within the reporting entity of the City as a blended component unit. The Bill provides that upon dissolution of a redevelopment agency, either the city or another unit of local government will agree to serve as the "successor agency" to hold the assets until they are distributed to other units of state and local government. On January 3, 2011, the City Council elected to become the Successor Agency for the former redevelopment agency in accordance with the Bill as part of City resolution number 2012-002. After enactment of the law, which occurred on June 28, 2011, redevelopment agencies in the State of California cannot enter into new projects, obligations or commitments. Subject to the control of a newly established oversight board, remaining assets can only be used to pay enforceable obligations in existence at the date of dissolution (including the completion of any unfinished projects that were subject to legally enforceable contractual commitments). In future fiscal years, successor agencies will only be allocated revenue in the amount that is necessary to pay the estimated annual installment payments on enforceable obligations of the former redevelopment agency until all enforceable obligations of the prior redevelopment agency have been paid in full and all assets have been liquidated. The Bill directs the State Controller of the State of California to review the propriety of any transfers of assets between redevelopment agencies and other public bodies that occurred after January 1, 2011. If the public body that received such transfers is not contractually committed to a third party for the expenditure or encumbrance of those assets, the State Controller is required to order the available assets to be transferred to the public body designated as the successor agency by the Bill. 67 ' e-J 192 CITY OF LA QUINTA NOTES TO FINANCIAL STATEMENTS (CONTINUED) JUNE 30, 2012 Note 23: Successor Agency Trust for Assets of Former Redevelopment Agency (Continued) Management believes, in consultation with legal counsel, that the obligations of the former redevelopment agency due to the City are valid enforceable obligations payable by the successor agency trust under the requirements of the Bill. The City's position on this issue is not a position of settled law and there is considerable legal uncertainty regarding this issue. It is reasonably possible that a legal determination may be made at a later date by an appropriate judicial authority that would resolve this issue unfavorably to the City. In accordance with the timeline set forth in the Bill (as modified by the California Supreme Court on December 29, 2011) all redevelopment agencies in the State of California were dissolved and ceased to operate as a legal entity as of February 1, 2012. Prior to that date, the final seven months of the activity of the redevelopment agency continued to be reported in the governmental funds of the City. After the date of dissolution, the assets and activities of the dissolved redevelopment agency are reported in a fiduciary fund (private -purpose trust fund) in the financial statements of the City. The transfer of the assets and liabilities of the former redevelopment agency as of February 1, 2012 (effectively the same date as January 31, 2012) from governmental funds of the City to fiduciary funds was reported in the governmental funds as an extraordinary loss (or gain) in the governmental fund financial statements. The receipt of these assets and liabilities as of January 31, 2012 was reported in the private -purpose trust fund as an extraordinary gain (or loss). Because of the different measurement focus of the governmental funds (current financial resources measurement focus) and the measurement focus of the trust funds (economic resources measurement focus), the extraordinary loss (gain) recognized in the governmental funds was not the same amount as the extraordinary gain (loss) that was recognized in the fiduciary fund financial statements. The difference between the extraordinary loss recognized in the fund financial statements and the extraordinary gain recognized in the fiduciary fund financial statements is reconciled as follows: Total extraordinary loss reported in the govemmental funds - increase to net assets of the Succesory Agency Trust Fund Deferred revenue reported in the government -wide financial statements - increase in net assets of the Successor Agency Trust Fund Unamortized debt issuance costs reported in government -wide financial statements - increase in net assets of the Successor Agency Trust Fund Long-term debt reported in the government -wide financial statements - decrease to net assets of the Successor Agency Trust Fund Net decrease to net assets of the Successor Agency Trust Fund as a result of initial transfers (equal to amount of extraordinary gain reported in the government -wide financial statements of the City) $ (79,058,255) (3,251,160) (4,323,334) 244,116,299 $ 157,483,550 68 193 CITY OF LA QUINTA NOTES TO FINANCIAL STATEMENTS (CONTINUED) JUNE 30, 2012 Note 23: Successor Agency Trust for Assets of Former Redevelopment Agency (Continued) a. Cash and investments Cash and investments reported in the accompanying financial statements consisted of the following: Cash and investments pooled with the City $ 23,193,145 Cash and investments with fiscal agent 57,077,193 $ 80,270,338 b. Loans Receivable Owner Participation Agreement — Garff Properties, LLC In July 2010, the former redevelopment. agency entered into an Owner Participation Agreement (OPA) with an Garff Properties -La Quinta, LLC ("Garff) that provides for the Agency to provide a rehabilitation loan to Garff of up to $2,300,000 for the construction of a new auto dealership facility and rehabilitation of an existing dealership facility. In connection with the OPA, Garff has executed a promissory note which is secured by a deed of trust, and an operating covenant. The loan will be repaid by crediting future sales and property tax increment taxes generated on the site until the cumulative taxes collected equals the loan amount. At that time, the note will be cancelled and the operating covenant will terminate. If, after ten years of operation, a shortfall exists between the revenues collected and the outstanding loan amount, the note will be cancelled and the operating covenant will terminate. Further, if at any time through no fault of the dealership certain future events outside of the dealership control occur the note will be cancelled and the operating covenant will terminate. The balance at June 30, 2012, is $2,504,809. Owner Participation Agreement — Torre Nissan In June 2011, the former redevelopment agency entered into an Owner Participation Agreement (OPA) with an autodealer, Mega Dealer, LLC ("Torre Nissan") that provides for the Agency to provide a rehabilitation loan to Torre Nissan of up to $1,500,000 for the remodeling of the existing dealership and an expansion of the dealership facility to accommodate a new line of electric and commercial vehicles. The new expansion will also include service and parts sales facilitates. In connection with the OPA, Torre Nissan has executed a promissory note, which is secured by a subordinated deed of trust, and in operation of the term of the note Nissan Motor Company ceases to exist, the note will be cancelled and the operating covenant will terminate. At the end of the ten-year operating covenant, the operating covenant will terminate and the note will be cancelled, and any outstanding loan balance will be forgiven. As of June 30, 2012, construction was in progress and $746,351 of the $1,500,000 had been expanded leaving an available balance of $753,649. c. Due from other Governments La Quinta Community Park In July 2002, an advance of $4,167,912 was made from the former redevelopment agency to provide funding for the development of the publicly owned improvements to the La Quinta Community Park. The advance accrues interest at the earnings rate of the City's investment pool fund. As of June 30, 2012, the remaining balance of the advance for the La Quinta Community Park is $1,183,816. 69 194 CITY OF LA QUINTA NOTES TO FINANCIAL STATEMENTS (CONTINUED) JUNE 30, 2012 Note 23: Successor Agency Trust for Assets of Former Redevelopment Agency (Continued) La Quinta Library In April 2005, another advance of $2,490,273 was made from the former redevelopment agency to provide funding for the construction of the public library. The advance accrues interest at the earnings rate of the City's investment pool fund. The remaining balance of this advance at June 30, 2012, is $1,860,330. Highway 111 Imorovements In June 2012, an advance of $1,276,516 was made from the former redevelopment agency to the City of La Quinta's Transportation Development Fund to provide funding for the Highway 111 median public improvements. The advance accrues interest at 7%. As of June 30, 2012, the remaining balance of the advance is $502,775. d. Long -Tenn Debt The following debt was transferred from the Redevelopment Agency to the Successor Agency as of February 1, 2012 as a result of the dissolution. A description of long-term debt outstanding (excluding defeased debt) of the Successor Agency as of June 30, 2012, follows: Transfers to Balance at Successor Balance at Due within one July 1, 2D11 Agency' Additions Deletions June 30, 2012 year Tax allocation bonds $ - $ 134,810.000 $ - $ - $ 134,810,000 $ 3,940,000 Provident Loan - 1,486,285 - 12,673 1,473,612 32,516 US Department of Agriculture - 722,046 - 5,674 716,372 14,267 Revenue bonds - 108,195,000 - - 108,195,000 1,890,000 Unamortized premiums/discounts - (1,097,032) 23,780 2,343 (1,075,595) - Total $ - $ 244,116,299 $ 23,780 $ 20,690 $ 244,119,389 $ 5,876,783 Tax Allocation Bonds On June 14, 2012, Moody's Investors Service ("Moody's") downgraded all California tax allocation bonds rated 'Baa3' and above. As such, the Bonds' insured rating was downgraded from 'AS to 'Ba1' and underlying rating was downgraded from 'AT to 'Ba1'. According to Moody's, all California tax allocation bond ratings remain on review for possible withdrawal. As of June 30, 2012, the following issuances of Tax Allocation Bonds were outstanding: Series 1994, Project Area No. 1 Tax Allocation Refunding Bonds, Series 1994, were issued by the former redevelopment agency on May 5, 1994, in the amount of $26,665,000 to refund the outstanding aggregate principal amount of the Agency's Tax Allocation Bonds, Series 1989 and 1990. The remaining proceeds were used to finance certain capital improvements within the La Quinta Redevelopment Project Area No. 1. 70 6 195 CITY OF LA QUINTA NOTES TO FINANCIAL STATEMENTS (CONTINUED) JUNE 30, 2012 Note 23: Successor Agency Trust for Assets of Former Redevelopment Agency (Continued) Interest rates on the bonds range from 3.80% to 8% and are payable semi-annually on March 1 and September 1 of each year until maturity. The interest on and principal of the bonds are payable solely from pledged tax increment revenues. The bonds are not just subject to redemption prior to maturity. There are certain limitations regarding the issuance of parity debt as further described in the official statement. A portion of the proceeds was used to obtain a surety agreement to satisfy the bond reserve requirement. The principal balance of outstanding bonds at June 30, 2012, is $2,470,000. The minimum annual requirements to amortize the bond payable as of June 30, 2012, are as follows: Principal Interest 2013 $ 2,470,000 $ 90,155 Totals $ 2,470,000 $ 90,155 Series 1998, Project Area No. 1 Tax allocation refunding bonds, Series 1998, in the amount of $15,760,000 were issued by the Agency to refund the outstanding aggregate principal amount of the former redevelopment agency's Tax Allocation Bonds, Series 1991. The remaining proceeds were used to finance certain capital improvements within the La Quinta Redevelopment Project Area No. 1. Interest rates on the bonds range from 5.20% to 5.25% and are payable semi-annually on March 1 and September 1 of each year until maturity. The interest and principal of the bonds are payable solely from pledged tax increment revenues of Project Area No. 1. Term Bonds maturing September 1, 2028, are subject to mandatory sinking fund redemption, in part by lot, on September 1, 2013, and on each September 1 thereafter, through September 1, 2028, at a price equal to the principal amount thereof plus accrued interest. There are certain limitations regarding the issuance of parity debt as further described in the official statement. A portion of the proceeds was used to obtain a surety agreement to satisfy the bond reserve requirement. The principal balance of outstanding bonds at June 30, 2012 is $15,760,000. The minimum annual requirements to amortize the bond payable as of June 30, 2012, are as follows: Prncipal Interest 2013 $ - $ 819,520 2014 655,000 802,490 2015 690,000 767,520 2016 725,000 730,730 2017 765,000 691,990 2018-2022 4.455,000 2,805,270 2023-2027 5,740,000 1,485,900 2028-2032 2,730,000 143,780 Totals $ 15.760.000 $ 8,247,200 71 196 CITY OF LA QUINTA NOTES TO FINANCIAL STATEMENTS (CONTINUED) JUNE 30, 2012 Note 23: Successor Agency Trust for Assets of Former Redevelopment Agency (Continued) Series 1998, Project Area No. 2 Tax allocation refunding bonds, Series 1998, in the amount of $6,750,000 were issued by the former redevelopment agency to refund the outstanding aggregate principal amount of the Agency's Tax Allocation Bonds, Series 1992. The remaining proceeds were used to finance certain capital improvements within the La Quinta Redevelopment Project Area No. 2. Interest rates on the bonds range from 3.75% to 5.28% and are payable semi-annually on March 1 and September 1 of each year until maturity. The interest and principal of the bonds are payable solely from pledged tax increment revenues of Project Area No. 2. Term Bonds maturing September 1, 2028 and September 1, 2033, are subject to mandatory sinking fund redemption, in part by lot, on September 1, 2009 and September 1, 2019, respectively, and on each September 1 thereafter at a equal to the principal amount thereof plus accrued interest. There are certain limitations regarding the issuance of parity debt as further described in the official statement. A portion of the proceeds was used to obtain a surety agreement to satisfy the bond reserve requirement. The principal balance of outstanding bonds at June 30, 2012 is $5,425,000. The minimum annual requirements to amortize the bond payable as of June 30, 2012, are as follows: Principal Interest 2013 $ 140,000 $ 279,819 2014 145.000 272,516 2015 150,000 264,956 2016 160,000 257,013 2017 170,000 248,556 2018-2022 975,000 1,000,075 2023-2027 1,270,000 807,188 2028-2032 1,635,000 428,006 2033-2037 780.000 41,475 Totals $ 5,425,000 $ 3,599,604 Series 2001, Project Area No. 1 On August 15, 2001, the former redevelopment agency issued tax allocation bonds in the amount of $48,000,000 to finance capital projects benefiting the La Quinta Redevelopment Project Area No. 1. The 2001 tax allocation bonds were issued at a discount of $422,400 and issuance costs of $1,517,325. The bonds consist of $17,280,000 of term bonds that accrue interest at 5.00% and mature on September 1, 2021, and $30,720,000 of term bonds that accrue interest at 5.18% and mature on September 1, 2031. The interest and principal on the bonds are payable from pledged tax increment revenues. A portion of the proceeds were used to obtain a surety agreement to satisfy the bond reserve requirement. The principal balance of outstanding bonds at June 30, 2012, is $48,000,000 with an unamortized discount of $332,065. 72 197 CITY OF LA QUINTA NOTES TO FINANCIAL STATEMENTS (CONTINUED) JUNE 30, 2012 Note 23: Successor Agency Trust for Assets of Former Redevelopment Agency (Continued) The minimum annual requirements to amortize the bond payable as of June 30, 2012, are as follows: Principal Interest 2013 $ - $ 2,430,720 2014 1,565,000 2,391,595 2015 1,645,000 2,311,345 2016 1,730,000 2,226,970 2017 1,815,000 2,138,345 2018-2022 10,525,000 9,200,475 2023-2027 13,455,000 6,186,173 2028-2032 17,265,000 2,288,753 Totals $ 48,000,000 $ 29,174,376 Series 2002, Project Area No. 1 On June 12, 2002, the former redevelopment agency issued tax allocation bonds in the amount of $40,000,000 to finance capital projects benefiting the La Quinta redevelopment Project Area No. 1. The 2002 tax allocation bonds were issued at a discount of $360,000 and issuance costs of $1,250,096. The bonds consist of $6,355,000 of serial bonds and $33,645,000 of term bonds. Interest Rates on serial bonds range from 1.75% and 4.00% and are payable semi-annually on March 1 and September 1 of each year until maturity. Term bonds accrue interest at 5.00% and 5.125% and mature on September 1, 2022 and September 1, 2023. The interest and principal on the bonds are payable from pledged tax increment revenues. A portion of the proceeds were used to obtain a surety agreement to satisfy the bond reserve requirement. The principal balance of outstanding bonds at June 30, 2012 is $34,380,000 with an unamortized discount of $294,744. The minimum annual requirements to amortize the bond payable as of June 30, 2012, are as follows: Principal Interest 2013 $ 735,000 $ 1,727,981 -2014 705,000 1,695,656 2015 735,000 1,659,656 2016 770,000 1,622,031 2017 810,000 1,582,531 2018-2022 4,710,000 7,245J56 2023-2027 6,025,000 5,899,091 2028-2032 12,385,000 3,795,959 2033-2037 7,505,000 192,316 Totals $ 34,380,000 $ 25,420,377 73 CITY OF LA QUINTA NOTES TO FINANCIAL STATEMENTS (CONTINUED) JUNE 30, 2012 Note 23: Successor Agency Trust for Assets of Former Redevelopment Agency (Continued) Series 2003, Project Area No. 1 On September 1, 2003, the former redevelopment agency issued tax allocation bonds in the amount of $26,400,000 to finance capital projects benefiting the La Quinta Redevelopment Project Area No. 1. The 2003 tax allocation bonds were issued at a discount of $277,200 and issuance costs of $629,191. Interest is payable semi-annually on March 1 and September 1 of each year, commencing March 1, 2004. Interest payments range from 4.24% to 6.44% per annum. The interest and principal on the bonds are payable from pledged tax increment revenues. Term bonds maturing on September 1, 2013 through September 1, 2032, are subject to mandatory redemption from minimum sinking fund payments, in part by lot, on September 1, 2004, September 1, 2014, and September 1, 2024, respectively, and on each September 1 thereafter at a redemption price equal to the principal amount thereof plus accrued interest to the redemption date. The principal balance of outstanding bonds at June 30, 2012, is $22,775,000 with an unamortized discount of $193,423. The minimum annual requirements to amortize the bond payable as of June 30, 2012, are as follows: Principal Interest 2013 $ 560,000 $ 1,423,495 2014 590,000 1,392,158 2015 620,000 1,356,736 2016 660,000 1,316,800 2017 700,000 1,274,368 2018-2022 4,220,000 5,636,456 2023-2027 5,730,000 4,085,165 2028-2032 7,815,000 1,926,043 2033-2037 1,880,000 60,536 Totals $ 22,775,000 $ 18,471,757 Series 2011, Project Area No. 2 On June 6, 2011, the former redevelopment agency issued subordinate taxable tax allocation bonds in the amount of $6,000,000 to finance capital projects benefiting the La Quinta Redevelopment Project Area No. 2. The 2001 tax allocation bonds were issued at a discount of $86,207 and issuance costs of $108,500. The bonds consist of $190,000 of term bonds that accrue interest at 5.375% and mature on September 1, 2016, $280,000 of term bonds that accrue interest at 7.125% and mature on September 1, 2021, $380,000 of term bonds that accrue interest at 7.600% and mature on September 1, 2026, and $5,150,000 of term bonds that accrue interest at 8.150% and mature on September 1, 2031. The interest and principal on the bonds are payable from pledged tax increment revenues. A portion of the proceeds were used to fund the bond reserve requirement. The principal balance of outstanding bonds at June 30, 2012, is $6,000,000 with an unamortized discount of $83,024. 74 199 CITY OF LA QUINTA NOTES TO FINANCIAL STATEMENTS (CONTINUED) JUNE 30, 2012 Note 23: Successor Agency Trust for Assets of Former Redevelopment Agency (Continued) The minimum annual requirements to amortize the bond payable as of June 30, 2012, are as follows: Principal Interest 2013 $ 35,000 $ 478,768 2014 35,000 476,886 2015 40,000 475,005 2016 40,000 472,855 2017 40,000 470,705 2018-2022 280,000 2,305,725 2023-2027 380,000 2,189,825 2028-2032 555,000 2,015,497 2033-2037 2,190,000 1,643,449 2038-2042 2,405,000 402,198 Totals $ 6,000,000 $ 10,930,913 Washington Street Apartments In October 2008, the former redevelopment agency acquired the Washington Street Apartments for cash and the assumption of the following debt: Provident Bank Loan This loan was originally entered into with the previous owner of the Washington Street Apartments and Provident Bank for $1,696,000 in August 2001 at an 8.36% interest rate. The loan is amortized on a thirty year basis with the outstanding balance due in twenty years or August 2021. The outstanding principal balance in October 2008 when the property was acquired by the former redevelopment agency was $1,572,031. The loan is secured by a deed of trust on the property and is senior to the United States Department of Agriculture (USDA) loan which is also secured by a deed of trust on the property. Repayment of the monthly loan amount of $12,873 is made from tenant rent receipts. The source for the final principal payment due in August 2021 of $1,050,109 will be determined at a future date. The principal balance of this loan at June 30, 2012 is $1,473,612. The minimum annual requirements to amortize the loan payable as of June 30, 2012, are as follows: Principal Interest 2013 $ 32,517 $ 121,959 2014 35,340 119,134 2015 38,411 116,064 2016 41,748 112,726 2017 45,375 109,099 2018-2022 1,280,221 408,070 Totals $ 1,473,612 $ 987,052 75 200 CITY OF LA QUINTA NOTES TO FINANCIAL STATEMENTS (CONTINUED) JUNE 30, 2012 Note 23: Successor Agency Trust for Assets of Former Redevelopment Agency (Continued) United States Department of Agriculture (USDA) Rural Development Promissory Note This promissory note was originally entered into with the previous owner of the Washington Street Apartments and USDA — Rural Development for $1,500,000 in November 1980 at a 10.00% interest rate. The note is amortized on a fifty year basis with the outstanding balance due in October 2030. The outstanding principal balance, in October 2008, when the property was acquired by the former redevelopment agency was $760,721. The loan is secured by a deed of trust on the property and is subordinated to the Provident loan which is also secured by a deed of trust on the property. Repayment of the monthly loan amount of $7,107 is made from tenant rent receipts and a rental subsidy from the USDA. Rural Development has agreed to a 9% interest rate subsidy on the Promissory Note as long as the Apartment renters meet certain program eligibility requirements. The principal balance of this note at June 30, 2012 is $716,372. Principal Interest 2013 $ 14,267 $ 71,014 2014 15,761 69,520 2015 17,412 67,870 2016 19,235 66,047 2017 21,249 64,033 2018-2022 144,664 281,745 2023-2027 238,017 188,392 2028-2032 245,768 45,420 Totals $ 716,373 $ 854,041 2004 Series A Local Agency Revenue Bonds On June 29, 2004, the La Quinta Financing Authority issued revenue bonds in the amount of $90,000,000 to finance projects benefiting low and moderate income housing in La Quinta Redevelopment Project Area No. 1 and La Quinta Redevelopment Project Area No. 2 and to advance refund the Agency's Redevelopment Project Areas No. 1 and 2, 1995 Housing Tax Allocation Bonds. The 2004 local agency revenue bonds were issued with issuance costs of $2,600,229 and a premium of $476,496. Interest is payable semi-annually on March 1 and September 1 of each year, commencing September 1, 2005. Interest payments range from 3% to 5.25% per annum. The interest and principal on the bonds are payable from pledged tax increment revenues. Term bonds maturing on September 1, 2024, September 1, 2029 and September 1, 2034, are subject to mandatory redemption from minimum sinking fund payments, in part by lot, on September 1, 2017, September 1, 2025, .and September 1, 2030, respectively, and on each September 1 thereafter at a 76 201 CITY OF LA QUINTA NOTES TO FINANCIAL STATEMENTS (CONTINUED) JUNE 30, 2012 Note 23: Successor Agency Trust for Assets of Former Redevelopment Agency (Continued) redemption price equal to the principal amount thereof plus accrued interest to the redemption date. A portion of the proceeds was used to obtain a surety agreement to satisfy the bond reserve requirement. There are certain limitations regarding the issuance of parity debt as further described in the official statement. The principal balance of outstanding bonds at June 30, 2012 is $79,345,000 with an unamortized premium of $123,717. The minimum annual requirements to amortize the bond payable as of June 30, 2012, are as follows: Principal Interest 2013 $ 1,890,000 $ 4,016,581 2014 1,975,000 3,924,681 2015 2,075,000 3,823,431 2016 2,175,000 3,714,463 2017 2,290,000 3,597,256 2018-2022 13,385,000 16,001,125 2023-2027 17, 280, 000 12, 014,144 2028-2032 22,115,000 7,061,797 2033-2037 16,160,000 1,269,975 Totals $ 79,345,000 $ 55,423,453 2011 Series A Local Agency Subordinate Taxable Revenue Bonds On June 9, 2011, the La Quinta Financing Authority issued revenue bonds in the amount of $28,850,000 to finance projects benefiting low and moderate income housing in La Quinta Redevelopment Project Area No. 1 and La Quinta Redevelopment Project Area No. 2. The 2011 local agency subordinate taxable revenue bonds were issued with issuance costs of $323,375 and a discount of $308,839. Interest is payable semi-annually on March 1 and September 1 of each year, commencing September 1, 2011. Interest payments range from 3.750% to 8.185% per annum. The interest and principal on the bonds are payable from pledged tax increment revenues. Term bonds maturing on September 1, 2026, September 1, 2031 and September 1, 2036, are subject to mandatory redemption from minimum sinking fund payments, in part by lot, on September 1, 2022, September 1, 2027, and September 1, 2032, respectively, and on each September 1 thereafter at a redemption price equal to the principal amount thereof plus accrued interest to the redemption date. A portion of the proceeds was used to fund the bond reserve requirement. There are certain limitations regarding the issuance of parity debt as further described in the official statement. The principal balance of outstanding bonds at June 30, 2012 is $28,850,000 with an unamortized discount of $296,056. %1n 202 77 CITY OF LA QUINTA NOTES TO FINANCIAL STATEMENTS (CONTINUED) JUNE 30, 2012 Note 23: Successor Agency Trust for Assets of Former Redevelopment Agency (Continued) The minimum annual requirements to amortize the bond payable as of June 30, 2012, are as follows: 2013 2014 2015 2016 2017 . 2018-2022 2023-2027 2028-2032 2033-2037 Totals e. Pledged Tax Revenues Principal Interest $ - $ 2,171,767 520,000 2,171,767 540,000 2,152,267 565,000 2,127,967 590,000 2,099,717 3,560,000 9,901,856 5,035,000 8,421,225 7,310,000 6,149,320 10,730,000 2,731,696 $ 28,850,000 $ 37,927,582 The City pledged, as security for bonds issued, either directly or through the Financing Authority, a portion of tax increment revenue (including Low and Moderate Income Housing set -aside and pass through allocations) that it receives. The bonds issued were to provide financing for various capital projects, accomplish Low and Moderate Income Housing projects and to defease previously issued bonds. Assembly Bill 1X 26 provided that upon dissolution of the Redevelopment Agency, property taxes allocated to redevelopment agencies no longer are deemed tax increment but rather property tax revenues and will be allocated first to successor agencies to make payments on the indebtedness incurred by the dissolved redevelopment agency. Total principal and interest remaining on the debt is $437,592,660 with annual debt service requirements as indicated below. For the current year, the total property tax revenue recognized by the City and Successor Agency for the payment of indebtedness incurred by the dissolved redevelopment agency was $45,566,968 and the debt service obligation on the bonds was $18,505,972. f. Conduit Debt Financing 2002 Series B Multifamily Housing Revenue Bonds In April 2002, the Agency issued $3,000,000 of 2002 Series B Multifamily Housing Revenue Bonds to provide financing for the acquisition, construction and equipping of a multifamily senior rental housing project known as Miraflores Apartments located in the City of La Quinta. The bonds mature on June 1, 2035, and bear interest at 5.6% per annum. Outstanding bonds at June 30, 2012, are $2,700,000. The bond is secured solely by the credit facility, Fannie Mae, and by a pledge of the trust estate comprised of bond proceeds and property. The bond is not an obligation of the issue, but payable solely from the security. g. Insurance The Successor Agency of the former redevelopment agency is covered under the insurance policy of the City of La Quinta at June 30, 2012. 78 „ - 203 OTHER GOVERNMENTAL FUNDS SPECIAL REVENUE FUNDS Special revenue funds are used to account for specific revenues (other than expendable trusts and major capital projects) and the related expenditures that are legally required to be accounted for in a separate fund. The City of La Quinta has the following Special Revenue Funds: State Gas Tax Fund — To account for gasoline allocations made by the State of California. These revenues are restricted by the State to expenditures for street -related purposes only. Library Fund — To account for revenues from property tax increment dedicated library services. Federal Assistance Fund — To account for revenues from the Community Development Block Grants received from the Federal Government and the expenditures of those resources. State Law Enforcements Block Grant (SLEBG) Fund — To account for state funded "Citizens for Public Safety' (COPS) program activities, as per Assembly Bill 3229, which supplements frontline police services such as anti -gang community crime prevention. Indian Gaming Fund — To account for contributions for public safety activities to reduce crime and increase public safety. Lighting and Landscape Special Assessment District 89-1 Fund — To account for special assessments levied on real property and the expenditure thereof from City-wide lighting and landscape maintenance and improvements. Quimby Fund — To account for the accumulation of developer fees received under the provisions of the Quimby Act for park development and improvements. Capital projects to be funded from this source will be budgeted and expended in a separate capital projects fund. Congestion Management Air Quality Fund — To account for grant funds related to improving air quality La Quinta Public Safety Officer Fund — To account for contributions to be distributed to public safety officers disabled or killed in the line of duty. Arts in Public Places — To account for development fees paid in lieu of acquisition and installation of approved artworks in a development with expenditures restricted to acquisition, installation, maintenance and repair of artworks at approved sites. South Coast Air Quality Fund — To account for contributions from the South Coast Air Quality Management District. Use is limited to reduction and control of airborne pollutants. AB 939 Fund — To account for the State mandated program to reduce waste sent to the landfills through recycling efforts. Development Agreement Fund — To account for the proceeds of development agreement revenues collected and the related expenditures in accordance with State requirements. Law Enforcement — To account for law enforcement grants ..lYr 79 2 0 4 Proposition 1 B - To account for the revenues and expenditures related to Proposition 1 B monies Justice Assistance Grant — To account for Federal Bureau of Justice Block Grant program grant funds, which are used to reduce crime and improve public safety. Housing Authority PA No.1 — To account for the housing activities of the Housing Authority in Project Area 1 which is to promote and provide for quality housing. Low/Moderate Income Housing — Proiect Area No. 1 Fund — This fund is used to account for the required 20% set aside of property tax increments that is legally restricted for increasing and improving housing for low and moderate income households. Low/Moderate Income Housing — Project Area No 2 Fund — This fund is used to account for the required 20% set aside of property tax increments that is legally restricted for increasing and improving housing for low and moderate income households. CAPITAL PROJECT FUNDS Capital projects funds account for the financial resources to be used for the acquisition, construction or improvements of major capital facilities and infrastructure. Infrastructure Fund - To account for the accumulation of resources provided through developer fees for the acquisition, construction or improvement of the City's infrastructure, prior to adoption of the new Developer Impact Fee Structure on August 16, 1999. This fund accounts for all developer resources received prior to this date, and is budgeted by the Council through adoption of the annual capital improvement program budget. Transportation Fund. Parks and Recreations Fund, Library Development Fund Community Center Fund Street Facility Fund, Park Facility Fund Fire Facility Fund — To account for the accumulation of resources provided through developer fees for the acquisition, construction, or improvement of the City's infrastructure. The Developer Impact Fee was adopted by the City Council on August 16, 1999. Eight new funds have been established to account for the specific impact areas of these fees, and are budgeted by the Council through adoption of the annual Capital Improvement Program budget. 2011 Low/Mod Bond Fund — To account for the 2011 Tax Allocation bond proceeds that will be used to benefit low and moderate income housing in La Quinta Redevelopment Project Area No. 1 and Project Area No. 2. 2004 Low/Mod Bond Fund — To account for the 2004 revenue bond proceeds that will be used to finance projects benefiting low and moderate income housing in La Quinta Redevelopment Project Area No. 1 and Project Area No. 2. Redevelopment Agency Proiect Area No. 1 — To account for the bond proceeds, interest and other funding that will be used for development, planning, construction and land acquisition. Redevelopment Agency Proiect Area No. 2 - To account for the bond proceeds, interest and other funding that will be used for development, planning, construction and land acquisition. DEBT SERVICE FUNDS Debt Service Funds are used to account for the accumulation of resources for, and the payment of, governmental long-term debt principal and interest. La Quinta Financing Authority Fund — To account for rental activity for the Civic Center and rental income used to pay the Financing Authority Civic Center and 2004 Local Agency Revenue Bond debt obligations. THIS PAGE INTENTIONALLY LEFT BLANK ,-: 206 81 CITY OF LA QUINTA COMBINING BALANCE SHEET NONMAJOR GOVERNMENTAL FUNDS JUNE 30, 2012 Special Revenue Funds Federal State Gas Tax Library Assistance SLEBG Assets: Pooled cash and investments $ $ 2,006,317 $ $ 1,456 Receivables: Accounts - - Notes and loans - Accrued interest 97 70 - 7 Due from other governments 124,624 - 8,879, 25,000 Total Assets $ 124,721 $ 2,006,387 $ 8,879 $ 26,463 Liabilities and Fund Balances: Liabilities: Accounts payable $ - $ - $ - $ - Deferred revenues 8,882 Unearned revenues - Deposits payable Due to other governments - Due to other funds 8,879 Advances from other funds - Total Liabilities - 17,761 - Fund Balances: Nonspendable: Notes and loans - - - - Restricted for: Planning and development projects - Public safety - 26,463 Community services - 2,006,387 - - Public works 124,721 - Capital Projects - Debt service Unassigned - - (8,882) Total Fund Balances 124,721 2,006,387 (8,882) 26,463 Total Liabilities and Fund Balances $ 124,721 $ 2,006,387 $ 8,879 $ 26,463 ...,.ie,.. 201 CITY OF LA QUINTA COMBINING BALANCE SHEET NONMAJOR GOVERNMENTAL FUNDS JUNE 30, 2012 (Continued) Special Revenue Funds Congestion Lighting and Management Air Indian Gaming Landscaping Quimby Quality Fund Assets: Pooled cash and investments $ 1,184 $ $ 8,287,475 $ Receivables: Accounts - - - - Notes and loans - - Accrued interest - 2,702 Due from other governments - 21,102 - Total Assets $ 1,184 $ 21,102 $ 8,290,177 $ Liabilities and Fund Balances: Liabilities: Accounts payable $ $ $ $ Deferred revenues - - - - Unearned revenues 1,184 Deposits payable - Due to other governments - - - - Due to other funds - - - - Advances from other funds - Total Liabilities 1,184 - - Fund Balances: Nonspendable: Notes and loans - - - - Restricted for: Planning and development projects - Public safety - - Community services - - 8,290,177 Public works - 21,102 - - Capital Projects - - Debt service - Unassigned - - - Total Fund Balances - 21,102 8,290,177 Total Liabilities and Fund Balances $ 1,184 $ 21,102 $ 8,290,177 $ 83 208 CITY OF LA QUINTA COMBINING BALANCE SHEET NONMAJOR GOVERNMENTAL FUNDS JUNE 30, 2012 Assets: Pooled cash and investments Receivables: Accounts Notes and loans Accrued interest Due from other governments Total Assets Liabilities and Fund Balances: Liabilities: Accounts payable Deferred revenues Unearned revenues Deposits payable Due to other governments Due to other funds Advances from other funds Total Liabilities Fund Balances: Nonspendable: Notes and loans Restricted for: Planning and development projects Public safety Community services Public works Capital Projects Debt service Unassigned Special Revenue Funds Art in Public South Coast Public Safety Places Air Quality AB 939 $ 27,112 $ 868,094 $ 78,732 $ 925,548 9 282 26 302 $ 27,121 $ 868,376 $ 78,758 $ 925,850 i $ $ 2,883 $ $ 2,883 - 78,758 925,850 27,121 - - - - 865,493 Total Fund Balances 27,121 865,493 78,758 925,850 Total Liabilities and Fund Balances $ 27,121 $ 868,376 $ 78,758 $ 925,850 84 ,„ 209 CITY OF LA QUINTA COMBINING BALANCE SHEET NONMAJOR GOVERNMENTAL FUNDS JUNE 30, 2012 (Continued) Special Revenue Funds Justice Development Law Proposition Assistance Agreement Enforcement I Grant Assets: Pooled cash and investments $ 200,919 $ 160,275 $ 287,213 $ Receivables: Accounts - - - Notes and loans - - - Accrued interest 65 3 94 - Due from other governments - 35,506 - 5,295 Total Assets $ 200,984 $ 195,784 $ 287,307 $ 5,295 Liabilities and Fund Balances: Liabilities: Accounts payable $ $ 4,181 $ $ Deferred revenues - Unearned revenues 287,307 Deposits payable 200,984 - Due to other governments - - - Due to other funds - - - 5,295 Advances from other funds - - - - Total Liabilities 200,984 4,181 287,307 5,295 Fund Balances: Nonspendable: Notes and loans - - - Restricted for: Planning and development projects - - Public safety - 191,603 Community services - - - Public works - - - Capital Projects - - - Debt service - - - Unassigned - - - Total Fund Balances 191,603 ft Total Liabilities and Fund Balances $ 200,984 $ 195,784 $ 287,307 $ 5,295 10 210 Ai CITY OF LA QUINTA COMBINING BALANCE SHEET NONMAJOR GOVERNMENTAL FUNDS JUNE 30, 2012 Capital Special Revenue Funds Projects Funds Housing Low/Moderate Low/Moderate Authority PA Income Housing Income Housing No. 1 PA No. 1 PA No. 2 Infrastructure Assets: Pooled cash and investments $ 1,496,175 $ - $ - $ 267,719 Receivables: Accounts 248,178 - - - Notes and loans 4,110,651 - - - Accrued interest 449 - - 82 Due from other governments - - - - Total Assets $ 5,855,453 $ $ $ 267,801 Liabilities and Fund Balances Liabilities: Accounts payable $ 1,248 $ $ $ Deferred revenues 2,045,040 Unearned revenues - Deposits payable 23,922 Due to other governments - - - - Due to other funds Advances from other funds Total Liabilities 2,070,210 Fund Balances: Nonspendable: Notes and loans 2,065,611 Restricted for: Planning and development projects 1,719,632 Public safety - - - Community services - - - Public works - - - - Capital Projects - - - 267,801 Debt service - Unassigned - - Total Fund Balances 3,785,243 267,801 Total Liabilities and Fund Balances $ 5,855,453 $ $ $ 267,801 86 M 211 CITY OF LA QUINTA COMBINING BALANCE SHEET NONMAJOR GOVERNMENTAL FUNDS JUNE 30, 2012 (Continued) Assets: Pooled cash and investments Receivables: Accounts Notes and loans Accrued interest Due from other governments Total Assets Liabilities and Fund Balances: Liabilities: Accounts payable Deferred revenues Unearned revenues Deposits payable Due to other governments Due to other funds Advances from other funds Total Liabilities Capital Projects Funds Parks and Library Community Transportation Recreation Development Center $ 3,123,810 $ - $ - $ 1,198,960 65,245 970 390 $ 3,190,025 $ - $ - $ 1,199,350 65,245 502,775 1,183, 816 1,860,330 568,020 1,183, 816 1,860,330 Fund Balances: Nonspendable: Notes and loans - - - - Restricted for: Planning and development projects Public safety Community services Public works Capital Projects 2,622,005 1,199,350 Debt service - - Unassigned - (1,183,816) (1,860,330) - Total Fund Balances 2,622,005 (1,183,816) (1,860,330) 1,199,350 Total Liabilities and Fund Balances $ 3,190,025 $ $ $ 1,199,350 212 87 CITY OF LA QUINTA COMBINING BALANCE SHEET NONMAJOR GOVERNMENTAL FUNDS JUNE 30, 2012 Capital Projects Funds 2011 Low/Mod Street Facility Park Facility Fire Facility Bond Assets: Pooled cash and investments $ - $ - $ - $ - Receivables: Accounts - - - - Notes and loans - - - - Accrued interest - - - - Due from other governments - - - - Total Assets $ $ $ - $ Liabilities and Fund Balances: Liabilities: Accounts payable $ - $ - $ - $ Deferred revenues - - - Unearned revenues - - - Deposits payable - - - Due to other governments - - - Due to other funds - Advances from other funds 2,021,772 - 913,642 Total Liabilities 2,021,772 - 913,642 - Fund Balances: Nonspendable: Notes and loans Restricted for: Planning and development projects Public safety Community services - - - - Public works - - - - Capital Projects - - - - Debt service - - - - Unassigned (2,021,772) (913,642) - Total Fund Balances (2,021,772) - (913,642) Total Liabilities and Fund Balances $ $ $ - $ if 213 Ref CITY OF LA QUINTA COMBINING BALANCE SHEET NONMAJOR GOVERNMENTAL FUNDS JUNE 30 2012 (Continued) Debt Service Ca ital ProjJects Funds Funds Assets: Pooled cash and investments Receivables: Accounts Notes and loans Accrued interest Due from other governments Total Assets Liabilities and Fund Balances: Liabilities: Accounts payable Deferred revenues Unearned revenues Deposits payable Due to other governments Due to other funds Advances from other funds Total Liabilities Fund Balances: Nonspendable: Notes and loans Restricted for: Planning and development projects Public safety Community services Public works Capital Projects Debt service Unassigned p Redevelopment Redevelopment 2004 Low/Mod Agency PA No. Agency PA No. Financing Bond 1 2 Authority $ - $ $ $ 2,534 $ $ $ $ 2,534 2,534 Total Fund Balances 2,534 Total Liabilities and Fund Balances $ $ $ $ 2,534 W. 214 CITY OF LA QUINTA COMBINING BALANCE SHEET NONMAJOR GOVERNMENTAL FUNDS JUNE 30, 2012 Total Governmental Funds Assets: Pooled cash and investments $ 18,933,523 Receivables: 313,423 Accounts 4,110,651 Notes and loans 5,548 Accrued interest 220,406 Due from other governments Total Assets $ 23,583,551 Liabilities and Fund Balances: Liabilities: $ 8,312 Accounts payable 2,053,922 Deferred revenues 353,736 Unearned revenues 224,906 Deposits payable 3,546,921 Due to other governments 14,174 Due to other funds 2,935,414 Advances from other funds Total Liabilities 9,137,385 Fund Balances: Nonspendable: 2,065,61 t Notes and loans Restricted for: 2,724,240 Planning and development projects Public safety 245,187 Community services 11,162,057 145,823 Public works 408 ,2,534 Capital Projects , Debt service (5,988,44242) Unassigned Total Fund Balances 14,446,166 Total Liabilities and Fund Balances $ 23,583,551 90 215 THIS PAGE INTENTIONALLY LEFT BLANK 91 � TM. 216 CITY OF LA QUINTA COMBINING STATEMENT OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCE NONMAJOR GOVERNMENTAL FUNDS YEAREND DJUNE 30 2012 Revenues: Taxes Assessments Intergovernmental Charges for services Use of money and property Developer participation Miscellaneous Total Revenues Expenditures: Current: General government Public safety Planning and development Community services Public works Capital outlay Debt service: Principal retirement Interest and fiscal charges Total Expenditures Excess (Deficiency) of Revenues Over (Under) Expenditures Other Financing Sources (Uses): Transfers in Transfers out Proceeds from sale of capital asset Total Other Financing Sources (Uses) Extraordinary gain/(loss) on dissolution of redevelopment agency (Note 23) Net Change in Fund Balances Fund Balances, Beginning of Year Fund Balances, End of Year Special Revenue Funds Federal State Gas Tax Library Assistance SLEBG 1,224,692 2,546,568 13,540 100,000 1,357 824 177 1,226,049 2,547,392 13,540 100,177 - 1,504,944 1,473,801 - 1,473,801 1,504,944 (247,752) 1,042,448 13,540 100,177 (22,422) (145,029) (22,4221 (145,029) (44,852) (8,882) 1,042,448 (247,752) 372,473 963,939 - 71,315 $ 124,721 $ 2,006,387 $ (8,8821 $ 26,463 92 217 CITY OF LA QUINTA COMBINING STATEMENT OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCE NONMAJOR GOVERNMENTAL FUNDS YEAR ENDED JUNE 30 2012 (Continued) Special Revenue Funds Congestion Lighting and Management Indian Gaming Landscaping Quimby Air Quality Revenues: $ $ - $ $ Taxes Assessments 950,292 - Intergovernmental 105,844 - 272,503 Charges for services Use of money and property 19,499 Developer participation 7,123 Miscellaneous - - Total Revenues 105,844 950,292 26,622 272,503 Expenditures: Current: General government - - Public safety - - Planning and development - - Community services - - Public works - 953,072 Capital outlay - - Debt service: Principal retirement - - - - Interest and fiscal charges Total Expenditures 953,072 Excess (Deficiency) of Revenues Over (Under) Expenditures 105,844 (2,780) 26,622 272,503 Other Financing Sources (Uses): Transfers in - Transfers out (105,844) - (159,281) (272,503) Proceeds from sale of capital asset Total Other Financing Sources (Uses) (105,844) (159,281) (272,503) Extraordinary gain/(loss) on dissolution of redevelopment agency (Note 23) - - - - Net Change in Fund Balances (2,780) (132,659) Fund Balances, Beginning of Year 23,882 8,422,836 Fund Balances, End of Year $ $ 21,102 $ 8:290,177 $ 93 �_�_^ 218 CITY OF LA QUINTA COMBINING STATEMENT OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCE NONMAJOR GOVERNMENTAL FUNDS YEAR ENDED JUNE 30 2012 Revenues: Taxes Assessments Intergovernmental Charges for services Use of money and property Developer participation Miscellaneous Total Revenues Expenditures: Current: General government Public safety Planning and development Community services Public works Capital outlay Debt service: Principal retirement Interest and fiscal charges Total Expenditures Excess (Deficiency) of Revenues Over (Under) Expenditures Other Financing Sources (Uses): Transfers in Transfers out Proceeds from sale of capital asset Special Revenue Funds Art in Public South Coast Public Safety Places Air Quality AB 939 72 2,148 - 62,680 58,674 161 1,968 72 64,828 58,835. 1,968 - 19,005 86,696 15,088 - - 45,786 60,874 19,005 86,696 72 3,954 39,830 (84,728) 2,000 Total Other Financing Sources (Uses) 2,000 Extraordinary gain/(loss) on dissolution of redevelopment agency (Note 23) Net Change in Fund Balances Fund Balances, Beginning of Year Fund Balances, End of Year (25,368) (64,663) (25,3681 (64,663) 2,072 3,954 14,462 (149,391) 25,049 861,539 64,296 1,075,241 $ 27,121 $ 865,493 $ 78,758 $ 925,850 94 -" 219 CITY OF LA QUINTA COMBINING STATEMENT OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCE NONMAJOR GOVERNMENTAL FUNDS YEAR ENDED JUNE 30 2012 (Continued) Revenues: Taxes Assessments Intergovernmental Charges for services Use of money and property Developer participation Miscellaneous Total Revenues Expenditures: Current: General government Public safety Planning and development Community services Public works Capital outlay Debt service: Principal retirement Interest and fiscal charges Total Expenditures Excess (Deficiency) of Revenues Over (Under) Expenditures Other Financing Sources (Uses): Transfers in Transfers out Proceeds from sale of capital asset Total Other Financing Sources (Uses) Extraordinary gain/(loss) on dissolution of redevelopment agency (Note 23) Net Change in Fund Balances Fund Balances, Beginning of Year Fund Balances, End of Year Special Revenue Funds Justice Development Law Proposition Assistance Agreement Enforcement I Grant 241,917 64,316 14,749 90 1,396 242,007 65,712 14,749 50,404 50,404 191,603 65,712 14,749 (65,712) (14,749) (65,712) (14,749) 191,603 $ $ 191,603 $ $ 95 . % " 220 CITY OF LA QUINTA COMBINING STATEMENT OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCE NONMAJOR GOVERNMENTAL FUNDS YEAR ENDED JUNE 30 2012 Capital Projects S ecial Revenue Funds Funds ousm9 Low Moderate LOWImooerate Authority PA Income Housing Income Housing No. 1 PA No. 1 PA No. 2 Infrastructure Revenues: Taxes Assessments Intergovernmental Charges for services Use of money and property Developer participation Miscellaneous Total Revenues Expenditures: Current: General government Public safety Planning and development Community services Public works Capital outlay Debt service: Principal retirement Interest and fiscal charges Total Expenditures $ $ 4,123,224 $ 2,341,482 $ 365,958 13,419 35,160 774 - 1,468 8,745 - 365,958 4,138,111 2,385,387 774 424,186 774,816 391,937 - 1,635,775 620,135 - - 1,746,648 932,376 - 424,186 4,157,239 1,944,448 Excess (Deficiency) of Revenues Over (Under) Expenditures (58,228) (19,128) 440,939 774 Other Financing Sources (Uses): Transfers in Transfers out Proceeds from sale of capital asset Total Other Financing Sources (Uses) Extraordinary gain/(loss) on dissolution of redevelopment agency (Note 23) Net Change in Fund Balances Fund Balances, Beginning of Year Fund Balances, End of Year 2,695,719 (28,321) (1,704,941) (2,112,912) (140,775) 875,275 - - - 846,954 990,778 (2,112,912) (140,775) 2,067,559 (11,464,844) (21,269,373) - 2,856,285 (10,493,194) (22,941,346) (140,001) 928,958 10,493,194 22,941,346 407,802 $ 3,785,243 $ $ $ 267,801 96 v 221 CITY OF LA QUINTA COMBINING STATEMENT OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCE NONMAJOR GOVERNMENTAL FUNDS YEAR ENDED JUNE 30 2012 (Continued) Revenues: Taxes Assessments Intergovernmental Charges for services Use of money and property Developer participation Miscellaneous Total Revenues Expenditures: Current: General government Public safety Planning and development Community services Public works Capital outlay Debt service: Principal retirement Interest and fiscal charges Capital Proiects Funds Parks and Library Community Transportation Recreation Development Center 7,383 - - 3,018 344,593 183,612 72,963 15,290 80,000 - - - 431,976 183,612 72,963 18,308 Total Expenditures Excess (Deficiency) of Revenues Over (Under) Expenditures Other Financing Sources (Uses): Transfers in Transfers out Proceeds from sale of capital asset Total Other Financing Sources (Uses) Extraordinary gain/(loss) on dissolution of redevelopment agency (Note 23) . Net Change in Fund Balances Fund Balances, Beginning of Year Fund Balances, End of Year 72,523 6,586 9,514 - 72,523 6,586 9,514 359,453 177,026 63,449 18,308 (1,230,979) (1,230,979) (871,526) 1771026 63,449 18,308 3,493,531 (1,360,842) (1,923,779) 1,181,042 $ 2,622,005 $ (1,183,816) $ (1,860,330) $ 1,199,350 97 '-N " 222 CITY OF LA QUINTA COMBINING STATEMENT OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCE NONMAJOR GOVERNMENTAL FUNDS YEAR ENDED JUNE 30 2012 Capital Projects Funds 2011 Low/Mod Street Facility Park Facility Fire Facility Bond Revenues: $ - $ - $ $ _ Taxes Assessments - _ Intergovernmental - Charges for services - 1 - 3,134 Use of money and property - Developer participation 12,758 4,422 15,514 Miscellaneous - - - Total Revenues 12,758 4,423 15,514 3,134 Expenditures: Current: General government - - Public safety - - Planning and development - - Community services - - Public works - - Capital outlay - - Debt service: Principal retirement Interest and fiscal charges - - 9,772 - 4,593 8,678 Total Expenditures 9,772 4,593 8,678 Excess (Deficiency) of Revenues Over (Under) Expenditures 2,986 4,423 10,921 (5,544) Other Financing Sources (Uses): Transfers in 4,423 - - Transfers out - (4,423) Proceeds from sale of capital asset - Total Other Financing Sources (Uses) 4,423 (4,423) Extraordinary gain/(loss) on dissolution (25,529,926) of redevelopment agency (Note 23) Net Change in Fund Balances 7,409 10,921 (25,535,470) Fund Balances, Beginning of Year (2,029,181) (924,563) 25,535,470 Fund Balances, End of Year $ (2,021,772) $ $ (913,642) $ 98 .3'. 223 CITY OF LA QUINTA COMBINING STATEMENT OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCE NONMAJOR GOVERNMENTAL FUNDS YEAR ENDED JUNE 30 2012 (Continued) Revenues: Taxes Assessments Intergovernmental Charges for services Use of money and property Developer participation Miscellaneous Total Revenues Expenditures: Current: General government Public safety Planning and development Community services Public works Capital outlay Debt service: Principal retirement Interest and fiscal charges Total Expenditures Excess (Deficiency) of Revenues Over (Under) Expenditures Other Financing Sources (Uses): Transfers in Transfers out Proceeds from sale of capital asset Total Other Financing Sources (Uses) Extraordinary gain/(loss) on dissolution of redevelopment agency (Note 23) Debt Service Capital Projects Funds Funds 2 04 Low/Mod Redevelopment Redevelopment Financing Bond Agency PA No.1 Agency PA No. 2 Authority _ - - 9,107 255 1,106 54,632 674,859 255 1,106 54,632 683,966 8,075 276,642 132,230 - 445,000 - 228,521 276,642 132,230 681,596 255 (275,536) (77,598) 2,370 47,130 (309,461) (1,294,749) (288,212) (2,695,719) (309,461) (1,247,619) (288,212) (2,695,719) (2,997,949) (21,503,166) (4,203,975) - Net Change in Fund Balances (3,307,155) (23,026,321) (4,569,785) (2,693,349) Fund Balances, Beginning of Year 3,307,155 23,026,321 4,569,785 2,695,883 Fund Balances, End of Year $ $ $ $ 2,534 99 224 CITY OF IA QUINTA COMBINING STATEMENT OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCE NONMAJOR GOVERNMENTAL FUNDS YEAR ENDED JUNE 30 2012 Total Governmental Funds Revenues: $ 6,464,706 Taxes 950,292 Assessments 4,642,803 Intergovernmental 9,107 Charges for services 1,187,391 Use of money and property 718,955 Developer participation 90,213 Miscellaneous Total Revenues 14,063,467 Expenditures: Current: 8,075 General government 50,404 Public safety 2,105,512 Planning and development 1,520,032 Community services 2,426,873 Public works 45,786 Capital outlay Debt service: 2,700,910 Principal retirement 3,019,211 Interest and fiscal charges Total Expenditures 11,876,803 Excess (Deficiency) of Revenues Over (Under) Expenditures 2,186,664 Other Financing Sources (Uses): Transfers in 2,749,272 Transfers out (10,686,063) Proceeds from sale of capital asset 875,275 Total Other Financing Sources (Uses) (7,061,516) Extraordinary gain/(loss) on dissolution (84,901,674) of redevelopment agency (Note 23) Net Change in Fund Balances (89,776,526) Fund Balances, Beginning of Year 104,222,692 Fund Balances, End of Year $ 14,446,166 100 1. 225 CITY OF LA QUINTA BUDGETARY COMPARISON SCHEDULE STATE GAS TAX YEAR ENDED JUNE 30, 2012 Variance with Final Budget Budget Amounts Actual Positive Original Final Amounts (Negative) Budgetary Fund Balance, July 1 $ 372,473 $ 372,473 $ 372,473 $ Resources (Inflows): Intergovernmental Use of money and property Amounts Available for Appropriation Charges to Appropriation (Outflow): Public works Total Charges to Appropriations Budgetary Fund Balance, June 30 994,700 994,700 1,224,692 229,992 200 200 1,357 1,157 1,367,373 1,367,373 1,598,522 231,149 994,900 1,367,373 1,473,801 (106,428) 994,900 1,367,373 1,473,801 (106,428) $ 372,473 $ $ 124,721 $ 124,721 101 226 CITY OF LA QUINTA BUDGETARY COMPARISON SCHEDULE LIBRARY YEAR ENDED JUNE 30, 2012 Budgetary Fund Balance, July 1 Resources (Inflows): Intergovernmental Use of money and property Amounts Available for Appropriation Charges to Appropriation (Outflow): Community services Total Charges to Appropriations Budgetary Fund Balance, June 30 Variance with Final Budget Budget Amounts Actual Positive Original Final Amounts (Negative) $ 963,939 $ 963,939 $ 963,939 $ - 2,123,900 2,123,900 2,546,568 422,668 6,400 6,400 824 (5,576) 3,094,239 3,094,239 3,511,331 417,092 1,776,094 1,776,094 1,504,944 271,150 1,776,094 1,776,094 1,504,944 271,150 $ 1,318,145 $ 1,318,145 $ 2,006,387 $ 688,242 102 n., 2 2 7 CITY OF LA QUINTA BUDGETARY COMPARISON SCHEDULE FEDERAL ASSISTANCE YEAR ENDED JUNE 30, 2012 Budgetary Fund Balance, July 1 Resources (Inflows): Intergovernmental Amounts Available for Appropriation Charges to Appropriation (Outflow): Transfers out Total Charges to Appropriations Budget Amounts Original Final Variance with Final Budget Actual Positive Amounts (Negative) 175,000 145,833 13,540 (132,293) 175,000 145,833 13,540 (132,293) 175,000 145,833 22,422 123,411 175,000 145,833 22,422 123,411 Budgetary Fund Balance, June 30 103 228 CITY OF LA QUINTA BUDGETARY COMPARISON SCHEDULE SLEBG YEAR ENDED JUNE 30, 2012 Budgetary Fund Balance, July 1 Resources (Inflows): Intergovernmental Use of money and property Amounts Available for Appropriation Charges to Appropriation (Outflow): Transfers out Total Charges to Appropriations Budgetary Fund Balance, June 30 Budget Amounts Original Final $ 71,315 $ 71,315 100,000 - 300 71,315 171,615 Variance with Final Budget Actual Positive Amounts (Negative) $ 71,315 $ 100,000 - 177 (123) 171,492 (123) 145,029 145,029 145,029 145,029 $ 71,315 $ 26,566 $ 26,463 $ (123) n 229 iGL•1 CITY OF LA QUINTA BUDGETARY COMPARISON SCHEDULE INDIAN GAMING YEAR ENDED JUNE 30, 2012 Budgetary Fund Balance, July 1 Resources (inflows): Intergovernmental Amounts Available for Appropriation Charges to Appropriation (Outflow): Transfers out Total Charges to Appropriations Budgetary Fund Balance, June 30 Variance with Final Budget Budget Amounts Actual Positive Original Final Amounts (Negative) 105,844 105,844 105,844 105,844 105,844 105,844 105,844 105,844 105,844 105,844 105,844 105,844 105 1 230 CITY OF LA OUINTA BUDGETARY COMPARISON SCHEDULE LIGHTING AND LANDSCAPING YEAR ENDED JUNE 30, 2012 Variance with Final Budget Budget Amounts Actual Positive Original Final Amounts (Negative) Budgetary Fund Balance, July 1 $ 23,882 $ 23,882 $ 23,882 $ Resources (Inflows): Assessments 964,219 979,114 950,292 (28,822) Amounts Available for Appropriation 988,101 1,002,996 974,174 (28,822) Charges to Appropriation (Outflow): Public works 1,002,996 1,002,996 953,072 49,924 Total Charges to Appropriations 1,002,996 1,002,996 953,072 49,924 Budgetary Fund Balance, June 30 $ (14,895) $ $ 21,102 $ 21,102 106 231 CITY OF LA QUINTA BUDGETARY COMPARISON SCHEDULE QUIMBY YEAR ENDED JUNE 30, 2012 Budgetary Fund Balance, July 1 Resources (Inflows): Use of money and property Developer participation Amounts Available for Appropriation Charges to Appropriation (Outflow): Community services Transfers out Total Charges to Appropriations Budgetary Fund Balance, June 30 Budget Amounts Original Final $ 8,422,836 $ 8,422,836 Variance with Final Budget Actual Positive Amounts (Negative) $ 8,422,836 $ 20,000 20,000 19,499 (501) 30,000 30,000 7,123 (22,877) 8,472,836 8,472,836 8,449,458 (23,378) - 200,000 - 200,000 325,000 8,269,543 159,281 8,110,262 325,000 8,469,543 159,281 8,310,262 $ 8,147,836 $ 3,293 $ 8,290,177 $ 8,286,884 107 1..If N CITY OF LA QUINTA BUDGETARY COMPARISON SCHEDULE CONGESTION MANAGEMENT AIR QUALITY FUND YEAR ENDED JUNE 30, 2012 Budgetary Fund Balance, July 1 Resources (Inflows): Intergovernmental Amounts Available for Appropriation Charges to Appropriation (Outflow): Transfers out Total Charges to Appropriations Budgetary Fund Balance, June 30 Variance with Final Budget Budget Amounts Actual Positive Original Final Amounts (Negative) 108 416,026 272,503 (143,523) 416,026 272,503 (143,523) 416,026 272,503 143,523 416,026 272,503 143,523 233 CITY OF LA QUINTA BUDGETARY COMPARISON SCHEDULE PUBLIC SAFETY YEAR ENDED JUNE 30, 2012 Budgetary Fund Balance, July 1 Resources (Inflows): Use of money and property Transfers in Amounts Available for Appropriation Charges to Appropriation (Outflow): Public safety Total Charges to Appropriations Budgetary Fund Balance, June 30 Variance with Final Budget Budget Amounts Actual Positive Original Final Amounts (Negative) $ 25,049 $ 25,049 $ 25,049 $ - 100 100 72 (28) 2,000 2,000 2,000 - 27,149 27,149 27,121 (28) 2,000 2,000 - 2,000 2,000 2,000 2,000 $ 25,149 $ 25,149 $ 27,121 $ 1,972 109 234 CITY OF LA QUINTA BUDGETARY COMPARISON SCHEDULE ART IN PUBLIC PLACES YEAR ENDED JUNE 30, 2012 Budgetary Fund Balance, July 1 Resources (Inflows): Use of money and property Developer participation Amounts Available for Appropriation Charges to Appropriation (Outflow): Community services Capital outlay Transfers out Total Charges to Appropriations Budgetary Fund Balance, June 30 Variance with Final Budget Budget Amounts Actual Positive Original Final Amounts (Negative) $ 861,539 $ 861,539 $ 861,539 $ - 2,300 2,300 2,148 (152) 97,500 97,500 62,680 (34,820) 961,339 961,339 926,367 (34,972) 24,700 24,700 15,088 9,612 111,500 111,500 45,786 65,714 200,000 400,000 - 400,000 336,200 536,200 60,874 475,326 $ 625,139 $ 425,139 $ 865,493 $ 440,354 110 1-'i , 235 CITY OF LA QUINTA BUDGETARY COMPARISON SCHEDULE SOUTH COAST AIR QUALITY YEAR ENDED JUNE 30, 2012 Budgetary Fund Balance, July 1 Resources (inflows): Intergovernmental Use of money and property Amounts Available for Appropriation Charges to Appropriation (Outflow): Planning and development Transfers out Total Charges to Appropriations Budgetary Fund Balance, June 30 Variance with Final Budget Budget Amounts Actual Positive Original Final Amounts (Negative) $ 64,296 $ 64,296 $ 64,296 $ 40,000 65,368 58,674 (6,694) 200 200 161 (39) 104,496 129,864 123,131 (6,733) 40,200 16,200 19,005 (2,805) - 25,368 25,368 40,200 41,568 44,373 (2,805) $ 64,296 $ 88,296 $ 78,758 $ (9,538) 111 is . 236 CITY OF LA QUINTA BUDGETARY COMPARISON SCHEDULE AB 939 YEAR ENDED JUNE 30, 2012 Budgetary Fund Balance, July 1 Resources (inflows): Use of money and property Amounts Available for Appropriation Charges to Appropriation (Outflow): Planning and development Transfers out Total Charges to Appropriations Budgetary Fund Balance, June 30 Budget Amounts Original Final $ 1,075,241 $ 1,075,241 Variance with Final Budget Actual Positive Amounts (Negative) $ 1,075,241 $ 4,300 4,300 1,968 (2,332) 1,079,541 1,079,541 1,077,209 (2,332) 114,080 126,305 86,696 39,609 268,146 64,663 203,483 114,080 394,451 151,359 243,092 $ 965,461 $ 685,090 $ 925,850 $ 240,760 237 112 CITY OF LA QUINTA BUDGETARY COMPARISON SCHEDULE LAW ENFORCEMENT YEAR ENDED JUNE 30, 2012 Variance with Final Budget Budget Amounts Actual Positive Original Final Amounts (Negative) Budgetary Fund Balance, July 1 $ - $ - $ $ - Resources (Inflows): Intergovernmental 241,025 241,917 892 Use of money and property - 90 90 Amounts Available for Appropriation 241,025 242,007 982 Charges to Appropriation (Outflow): Public safety 51,808 50,404 1,404 Total Charges to Appropriations 51,808 50,404 1,404 Budgetary Fund Balance, June 30 $ $ 189,217 $ 191,603 $ 2,386 113 r 2,58 D CITY OF LA QUINTA BUDGETARY COMPARISON SCHEDULE PROPOSITION 1B YEAR ENDED JUNE 30, 2012 Variance with Final Budget Budget Amounts Actual Positive Original Final Amounts (Negative) Budgetary Fund Balance, July 1 $ $ $ - $ Resources (Inflows): Intergovernmental 352,382 64,316 (288,066) Use of money and property - 1,396 1,396 Amounts Available for Appropriation 352,382 65,712 (286,670) Charges to Appropriation (Outflow): Transfers out 352,382 65,712 286,670 Total Charges to Appropriations 352,382 65,712 286,670 Budgetary Fund Balance, June 30 $ $ $ $ 0 114 tr. 239 CITY OF LA QUINTA BUDGETARY COMPARISON SCHEDULE JUSTICE ASSISTANCE GRANT YEAR ENDED JUNE 30, 2012 Budgetary Fund Balance, July 1 Resources (inflows): Intergovernmental Amounts Available for Appropriation Charges to Appropriation (Outflow): Transfers out Total Charges to Appropriations Budgetary Fund Balance, June 30 Budget Amounts Original Final Variance with Final Budget Actual Positive Amounts (Negative) 16,152 14,749 (1,403) 16,152 14,749 (1,403) 16,152 14,749 1,403 16,152 14,749 1,403 115 11 240 CITY OF LA QUINTA BUDGETARY COMPARISON SCHEDULE HOUSING AUTHORITY PA NO. 1 YEAR ENDED JUNE 30, 2012 Budgetary Fund Balance, July 1 Resources (Inflows): Use of money and property Transfers in Proceeds from sale of capital asset Amounts Available for Appropriation Charges to Appropriation (Outflow): Planning and development Transfers out Extraordinary gain/(loss) on dissolution of redevelopment agency Total Charges to Appropriations Budgetary Fund Balance, June 30 Variance with Final Budget Budget Amounts Actual Positive Original Final Amounts (Negative) $ 928,958 $ 928,958 $ 928,958 $ - 243,800 243,800 365,958 122,158 - 2,035,388 - (2,035,388) 125,000 590,000 875,275 285,275 1,297,758 3,798,146 2,170,191 (1,627,955) 368,112 1,100,625 424,186 676,439 - 69,497 28,321 41,176 - (2,067,559) 2,067,559 368,112 1,170,122 (1,615,052) 2,785,174 $ 929,646 $ 2,628,024 $ 3,785,243 $ 1,157,219 116 241 CITY OF LA QUINTA BUDGETARY COMPARISON SCHEDULE LOW/MODERATE INCOME HOUSING PA NO. 1 YEAR ENDED JUNE 30, 2012 Budgetary Fund Balance, July 1 Resources (Inflows): Taxes Use of money and property Miscellaneous Transfers in Amounts Available for Appropriation Charges to Appropriation (Outflow): Planning and development Debt service: Principal retirement Interest and fiscal charges Transfers out Extraordinary gain/(loss) on dissolution of redevelopment agency Total Charges to Appropriations Budgetary Fund Balance, June 30 Variance with Final Budget Budget Amounts Actual Positive Original Final Amounts (Negative) $ 10,493,194 $10,493,194 $ 10,493,194 $ - 8,802,400 4,123,224 4,123,224 44,600 44,600 13,419 (31,181) - - 1,468 1,468 6,535,056 2,695,719 (3,839,337) 19,340,194 21,196,074 17,327,024 (3,869,050) 2,868,136 2,604,751 774,816 1,829,935 - 1,635,775 1,635,775 - - 3,850,670 1,746,648 2,104,022 8,357,965 6,101,691. 1,704,941 4,396,750 - 11,464,844 (11,464,844) 11,226,101 14,192,887 17,327,024 (3,134,137) $ 8,114,093 $ 7,003,187 $ 117 242 CITY OF IA QUINTA BUDGETARY COMPARISON STATEMENT LOW/MODERATE INCOME HOUSING PA NO.2 YEAR ENDED JUNE 30, 2012 Budgetary Fund Balance, July 1 Resources (Inflows): Taxes Use of money and property Miscellaneous Transfers in Amounts Available for Appropriation Charges to Appropriation (Outflow): Planning and development Debt service: Principal retirement Interest and fiscal charges Transfers out Extraordinary gain/(loss) on dissolution of redevelopment agency Total Charges to Appropriations Budgetary Fund Balance, June 30 Variance with Final Budget Budget Amounts Actual Positive Original Final Amounts (Negative) $ 22,941,346 $22,941,346 $ 22,941,346 $ 4,800,480 2,341,482 2,341,482 60,800 60,800 35,160 (25,640) - - 8,745 8,745 - 1,651,794 (1,651,794) 27,802,626 26,995,422 25,326,733 (1,668,689) 1,231,960 1,040,010 391,937 648,073 - 595,650 620,135 (24,485) - 1,872,502 932,376 940,126 4,634,386 12,126,274 2,112,912 10,013,362 - 21,269,373 (21,269,373) 5,866,346 15,634,436 25,326,733 (9,692,297) $ 21,936,280 $11,360,986 $ $ (11,360,986) 118 1"M1 243 CITY OF LA QUINTA BUDGETARY COMPARISON SCHEDULE CAPITAL IMPROVEMENT YEAR ENDED JUNE 30, 2012 Budgetary Fund Balance, July 1 Resources (Inflows): Intergovernmental Developer participation Transfers in Amounts Available for Appropriation Charges to Appropriation (Outflow): Capital outlay Transfers out Total Charges to Appropriations Budgetary Fund Balance, June 30 Variance with Final Budget Budget Amounts Actual Positive Original Final Amounts (Negative) $ 1,154,860 $ 1,154,860 $ 1,154,860 $ 12,242,911 23,242,544 2,425,180 (20,817,364) 202,200 509,704 101,699 (408,005) 7,751,183 87,666,834 9,394,375 (78,272,459) 21,351,154 112,573,942 13,076,114 (99,497,828) 20,196,294 111,475,030 13,119,645 98,355,385 - 47,130 (47,130) 20,196,294 111,475,030 13,166,775 98,308,255 $ 1,154,860 $ 1,098,912 $ (90,661) $ (1,189,573) 244 119 CITY OF LA QUINTA BUDGETARY COMPARISON SCHEDULE CIVIC CENTER YEAR ENDED JUNE 30, 2012 Budgetary Fund Balance, July 1 Resources (Inflows): Developer participation Amounts Available for Appropriation Charges to Appropriation (Outflow): General government Debt service: Interest and fiscal charges Total Charges to Appropriations Budgetary Fund Balance, June 30 Variance with Final Budget Budget Amounts Actual Positive Original Final Amounts (Negative) $ (7,012,033) $ (7,012,033) $ (7,012,033) $ 127,600 69,482 82,490 13,008 (6,884,433) (6,942,551) (6,929,543) 13,008 202,056 202,056 204,787 (2,731) 35,000 35,000 35,160 (160) 237,056 237,056 239,947 (2,891) $ (7,121,489) $ (7,179,607) $ (7,169,490) $ 10,117 120 245 CITY OF LA QUINTA BUDGETARY COMPARISON SCHEDULE INFRASTRUCTURE YEAR ENDED JUNE 30, 2012 Budgetary Fund Balance, July 1 Resources (Inflows): Use of money and property Amounts Available for Appropriation Charges to Appropriation (Outflow): Transfers out Total Charges to Appropriations Variance with Final Budget Budget Amounts Actual Positive Original Final Amounts (Negative) $ 407,802 $ 407,802 $ 407,802 $ 100 300 774 474 407,902 408,102 408,576 474 393,074 140,775 252,299 393,074 140,775 252,299 Budgetary Fund Balance, June 30 $ 407,902 $ 15,026 $ 267,801 $ 252,773 121 .if. 246 CITY OF LA QUINTA BUDGETARY COMPARISON SCHEDULE TRANSPORTATION YEAR ENDED JUNE 30, 2012 Budgetary Fund Balance, July 1 Resources (Inflows): Use of money and property Developer participation Miscellaneous Amounts Available for Appropriation Charges to Appropriation (Outflow): Debt service: Interest and fiscal charges Transfers out Total Charges to Appropriations Budgetary Fund Balance, June 30 Variance with Final Budget Budget Amounts Actual Positive Original Final Amounts (Negative) $ 3.493,531 $ 3,493,531 $ 3,493,531 $ - 1,800 1,800 7,383 5,583 441,500 353,410 344,593 (8,817) 80,000 80,000 80,000 4,016,831 3,928,741 3,925,507 (3,234) - 76,802 72,523 4,279 1,163,104 4,078,612 1,230,979 2,847,633 1,163,104 4,155,414 1,303,502 2,851,912 $ 2,853,727 $ (226,673) $ 2,622,005 $ 2,848,678 122 241 CITY OF LA QUINTA BUDGETARY COMPARISON SCHEDULE PARKS AND RECREATION YEAR ENDED JUNE 30, 2012 Budgetary Fund Balance, July 1 Resources (Inflows): Developer participation Amounts Available for Appropriation Charges to Appropriation (Outflow): Debt service: Interest and fiscal charges Total Charges to Appropriations Budgetary Fund Balance, June 30 Variance with Final Budget BudgetAmounts Actual Positive Original Final Amounts (Negative) $ (1,360,842) $ (1,360,842) $ (1,360,842) $ 89,200 167,556 183,612 16,056 (1,271,642) (1,193,286) (1,177,230) 16,056 7,100 7,100 6,586 514 7,100 7,100 6,586 514 $ (1,278,742) $ (1,200,386) $ (1,183,816) $ 16,570 123 10 248 CITY OF LA QUINTA BUDGETARY COMPARISON SCHEDULE LIBRARY DEVELOPMENT YEAR ENDED JUNE 30, 2012 Budgetary Fund Balance, July 1 Resources (Inflows): Developer participation Amounts Available for Appropriation Charges to Appropriation (Outflow): Debt service: Interest and fiscal charges Total Charges to Appropriations Budgetary Fund Balance, June 30 Variance with Final Budget Budget Amounts Actual Positive Original Final Amounts (Negative) $ (1,923,779) $ (1,923,779) $ (1,923,779) $ 35,500 66,573 72,963 6,390 (1,888,279) (1,857,206) (1,850,816) 6,390 9,800 9,800 9,514 286 9,800 9,800 9,514 286 $ (1,898,079) $ (1,867,006) $ (1,860,330) $ 6,676 124 "..It - 249 CITY OF LA QUINTA BUDGETARY COMPARISON SCHEDULE COMMUNITY CENTER YEAR ENDED JUNE 30, 2012 Budgetary Fund Balance, July 1 Resources (Inflows): Use of money and property Developer participation Amounts Available for Appropriation Budgetary Fund Balance, June 30 Variance with Final Budget Budget Amounts Actual - Positive Original Final Amounts (Negative) $1,181,042 $ 1,181,042 $ 1,181,042 $ 5,900 5,900 3,018 (2,882) 7,400 13,958 15,290 1,332 1,194,342 1,200,900 1,199,350 (1,550) $1,194,342 $ 1,200,900 $ 1,199,350 $ (1,550) 250 125 CITY OF LA QUINTA BUDGETARY COMPARISON SCHEDULE STREET FACILITY YEAR ENDED JUNE 30, 2012 Budgetary Fund Balance, July 1 Resources (Inflows): Developer participation Transfers in Amounts Available for Appropriation Charges to Appropriation (Outflow): Debt service: Interest and fiscal charges Total Charges to Appropriations Variance with Final Budget Budget Amounts Actual Positive Original Final Amounts (Negative) $ (2,029,181) $ (2,029,181) $ (2,029,181) $ - 17,800 13,508 12,758 (750) 2,200 2,200 4,423 2,223 (2,009,181) (2,013,473) (2,012,000) 1,473 10,000 10,000 9,772 228 10,000 10,000 9,772 228 Budgetary Fund Balance, June 30 $ (2,0191181) $ (2,023,473) $ (2,021,772) $ 1,701 it 126 251 CITY OF LA QUINTA BUDGETARY COMPARISON SCHEDULE PARK FACILITY YEAR ENDED JUNE 30, 2012 Budgetary Fund Balance, July 1 Use of money and property Developer participation Amounts Available for Appropriation Charges to Appropriation (Outflow): Transfers out Total Charges to Appropriations Budoet Amounts Original Final 2,200 4,026 2,200 4,026 Variance with Final Budget Actual Positive Amounts (Negative) 1 1 4,422 396 4,423 397 2,200 2,200 4,423 (2,223) 2,200 2,200 4,423 (2,223) Budgetary Fund Balance, June 30 $ $ 1,826 $ $ (1,826) 127 M 252 CITY OF LA QUINTA BUDGETARY COMPARISON SCHEDULE FIRE FACILITY YEAR ENDED JUNE 30, 2012 Budgetary Fund Balance, July 1 Resources (Inflows): Developer participation Amounts Available for Appropriation Charges to Appropriation (Outflow): Debt service: Interest and fiscal charges Total Charges to Appropriations Variance with Final Budget Budget Amounts Actual Positive Original Final Amounts (Negative) $ (924,563) $ (924,563) $ (924,563) $ - 29,800 15,731 15,514 (217) (894,763) (908,832) (909,049) (217) 4,700 4,700 4,593 107 4,700 4,700 4,593 107 Budgetary Fund Balance, June 30 $ (899,463) $ (913,532) $ (913,642) $ (110) 128 �, 253 CITY OF LA QUINTA BUDGETARY COMPARISON SCHEDULE 2011 LOW/MOD BOND YEAR ENDED JUNE 30, 2012 Variance with Final Budget Budget Amounts Actual Positive Original Final Amounts (Negative) Budgetary Fund Balance, July 1 $ 25,535,470 $25,535,470 $ 25,535,470 $ Resources (Inflows): Use of money and property - 5,000 3,134 (1,866) Amounts Available for Appropriation 25,535,470 25,540,470 25,538,604 (1,866) Charges to Appropriation (Outflow): Debt service: Interest and fiscal charges - - 8,678 (8,678) Transfers out - 25,526,567 - 25,526,567 Bond Issuance Costs - 11,000 - 11,000 Extraordinary gain/(loss) on dissolution of redevelopment agency - - 25,529,926 (25,529,926) Total Charges to Appropriations 25,537,567 25,538,604 (1,037) Budgetary Fund Balance, June 30 $ 25,535,470 $ 2,903 $ $ (2,903) 129 . n 2 5' U , CITY OF LA QUINTA BUDGETARY COMPARISON SCHEDULE 2004 LOW/MOD BOND YEAR ENDED JUNE 30, 2012 Budgetary Fund Balance, July 1 Resources (Inflows): Use of money and property Amounts Available for Appropriation Charges to Appropriation (Outflow): Transfers out Extraordinary gain/(loss) on dissolution of redevelopment agency Total Charges to Appropriations Variance with Final Budget Budget Amounts Actual Positive Original Final Amounts (Negative) $ 3,307,155 $ 3,307,155 $ 3,307,155 $ 4,815 500 255 (245) 3,311,970 3,307,655 3,307,410 (245) 3,307,155 309,461 2,997,694 - 2,997,949 (2,997,949) 3,307,155 3,307,410 (255) Budgetary Fund Balance, June 30 $ 3,311,970 $ 500 $ $ (500) 130 n. 255 CITY OF LA QUINTA BUDGETARY COMPARISON SCHEDULE REDEVLOPMENT AGENCY PA NO. 1 - CAPITAL PROJECT YEAR ENDED JUNE 30, 2012 Budgetary Fund Balance, July 1 Resources (Inflows): Use of money and property Transfers in Amounts Available for Appropriation Charges to Appropriation (Outflow): Planning and development Transfers out Extraordinary gain/(loss) on dissolution of redevelopment agency Total Charges to Appropriations Budgetary Fund Balance, June 30 Variance with Final Budget Budget Amounts Actual Positive Original Final Amounts (Negative) $ 23,026,321 $23.026,321 $ 23,026,321 $ 44,500 44,500 1,106 (43,394) 5,000,000 5,000,000 47,130 (4,952,870) 28,070,821 28,070,821 23,074,557 (4,996,264) 530,025 477,685 276,642 201,043 - 31,171,576 1,294,749 29,876,827 21,503,166 (21,503,166) 530,025 31,649,261 23,074,557 8,574,704 $ 27,540,796 $ (3,578,440) $ - $ 3,578,440 131 256 CITY OF LA QUINTA BUDGETARY COMPARISON SCHEDULE REDEVLOPMENT AGENCY PA NO. 2 - CAPITAL PROJECT YEAR ENDED JUNE 30, 2012 Budgetary Fund Balance, July 1 Resources (Inflows): Use of money and property Transfers in Amounts Available for Appropriation Charges to Appropriation (Outflow): Planning and development Transfers out Extraordinary gain/(loss) on dissolution of redevelopment agency Total Charges to Appropriations Variance with Final Budget Budget Amounts Actual Positive Original Final Amounts (Negative) $ 4,569,789 $ 4,569,785 $ 4,569,785 $ - 76,802 54,632 (22,170) 1,650,000 1,650,000 (1,650,000) 6,219,785 6,296,587 4,624,417 (1,672,170) 162,232 1,691,437 132,230 1,559,207 247,000 4,219,890 288,212 3,931,678 4,203,975 (4,203,975) 409,232 5,911,327 4,624,417 1,286,910 Budgetary Fund Balance, June 30 $ 5,810,553 $ 385,260 $ $ (385,260) 132 " 257 CITY OF LA QUINTA BUDGETARY COMPARISON SCHEDULE REDEVELOPMENT AGENCY PA NO. 1 - DEBT SERVICE YEAR ENDED JUNE 30, 2012 Budgetary Fund Balance, July 1 Resources (Inflows): Taxes Use of money and property Amounts Available for Appropriation Charges to Appropriation (Outflow): Community development Debt service: Principal retirement Interest and fiscal charges Pass -through agreement payments Transfers out Total Charges to Appropriations Budgetary Fund Balance, June 30 Variance with Final Budget Budget Amounts Actual Positive Original Final Amounts (Negative) $ 745,343 $ 745,343 $ 745,343 $ - 5,486,445 15,084,976 16,505,087 1,420,111 3,000 3,000 (13,122) (16,122) 6,234,788 15, 833,319 17,237,308 1,403,989 411,600 429,212 428,522 690 4,374,077 3,947,652 3,947,652 - 6,724,310 6,675,388 3,386,073 3,289,315 19,377,273 9,150,705 8,986,409 164,296 10,011,098 13,976,264 488,652 13,487,612 40,898,358 34,179,221 17,237,308 16,941,913 $ (34,663,570) $ (18,345,902) $ $ 18,345,902 133 258 CITY OF LA QUINTA BUDGETARY COMPARISON SCHEDULE REDEVELOPMENT AGENCY PA NO. 2 • DEBT SERVICE YEAR ENDED JUNE 30, 2012 Budgetary Fund Balance, July 1 Resources (Inflows): Taxes Use of money and property Transfers in Amounts Available for Appropriation Charges to Appropriation (Outflow): Community development Debt service: Principal retirement Interest and fiscal charges Pass -through agreement payments Transfers out Extraordinary gain/(loss) on dissolution of redevelopment agency Total Charges to Appropriations Budgetary Fund Balance, June 30 Variance with Final Budget Budget Amounts Actual Positive Original Final Amounts (Negative) $ 560,200 $ 560,200 $ 560,200 $ 19,201,924 9,365,929 9,365,929 200 200 (15,571) (15,771) 2,468,152 558,747 - (558,747) 22,230,476 10,485,076 9,910,558 (574,518) 255,100 246,068 241,543 4,525 130,000 380,000 380,000 - 633,843 633,843 252,757 381,086 16,387,298 8,215,043 7,769,032 446,011 4,118,152 2,205,178 - 2,205,178 - - 1,267,226 (1,267,226) 21,524,393 11,680,132 9,910,558 1,769,574 $ 706,083 $ (1,195,056) $ $ 1,195,056 134 z, 259 CITY OF LA QUINTA BUDGETARY COMPARISON SCHEDULE FINANCING AUTHORITY YEAR ENDED JUNE 30, 2012 Variance with Final Budget Budget Amounts Actual Positive Original Final Amounts (Negative) Budgetary Fund Balance, July 1 $ 2,695,883 $ 2,695,883 $ 2,695,883 $ Resources (Inflows): Charges for services 11,600 11,600 9,107 (2,493) Use of money and property _ 673,521 673,521 674,859 1,338 Transfers in 7,479,250 - - - Amounts Available for Appropriation 10,860,254 3,381,004 3,379,849 (1,155) Charges to Appropriation (Outflow): General government 11,600 11,600 8,075 3,525 Debt service: Principal retirement 3,824,531 3,824,531 445,000 3,379,531 Interest and fiscal charges 4,328,240 4,328,240 228,521 4,099,719 Transfers out - 2,695,719 2,695,719 - Total Charges to Appropriations 8,164,371 10,860,090 3,377,315 7,482,775 Budgetary Fund Balance, June 30 $ 2,695,883 $ (7,479,086) $ 2,534 $ 7,481,620 135 1 260 THIS PAGE INTENTIONALLY LEFT BLANK 136 1 261 INTERNAL SERVICE FUNDS Internal service funds are used to account for activities involved in rendering services to departments within the City. Costs of materials and services used are accumulated in this fund and charged to the user departments as such goods are delivered or services rendered. The City of La Quinta has the following Internal Service Funds: Equipment Replacement Fund —used to account for the ultimate replacement of City owned and operated vehicles and equipment Information Technology Fund — used to account for the purchase and replacement of information systems. Park Equipment and Facilities Fund — used to account for the purchase and replacement of City owned park facility infrastructure. 137 is 262 CITY OF LA OUINTA COMBINING STATEMENT OF NET ASSETS INTERNAL SERVICE FUNDS JUNE 30, 2012 Governmental Activities - Internal Service Funds Park Equipment Information Equipment and Replacement Technology Facilities Totals Assets: Current: Cash and investments Receivables: Accrued interest Prepaid costs Total Current Assets Noncurrent: Capital assets - net of accumulated depreciation Total Noncurrent Assets Total Assets Liabilities and Net Assets: Liabilities: Current: Accounts payable Accrued liabilities Accrued compensated absences Total Current Liabilities Noncurrent: Accrued compensated absences Total Noncurrent Liabilities Total Liabilities Net Assets: Invested in capital assets, net of related debt Unrestricted Total Net Assets $ 2,039,419 $ 1,102,164 $ 653.038 $ 3,794,621 653 358 214 1,225 - 240 - 240 2,040,072 1,102,762 653,252 3,796,086 761,257 276,052 16,160,638 17,197,947 761,257 276,052 16,160,638 17,197,947 $ 2,801,329 $ 1,378,814 $ 16,813,890 $ 20,994,033 $ 11,264 $ 507 $ $ 11,771 - 3,948 3,948 - 4,078 4,078 11,264 8,533 19,797 - 5,635 - 5,635 5,635 5,635 11,264 14,168 - 25,432 761,257 276,052 16,160,638 17,197,947 2,028,808 1,088,594 653,252 3,770,654 2,790,065 1,364,646 16,813,890 20,968,601 Total Liabilities and Net Assets $ 2,801,329 $ 1,378,814 $ 16,813,890 $ 20,994,033 138 10263 CITY OF LA QUINTA COMBINING STATEMENT OF REVENUES, EXPENSES AND CHANGES IN FUND NET ASSETS INTERNAL SERVICE FUNDS YEAR ENDED JUNE 30, 2012 Governmental Activities - Internal Service Funds Park Equipment Information Equipment and Replacement Technology Facilities Totals Operating Revenues: Sales and service charges $ 600,588 $ 485,522 $ $ 1,086,110 Miscellaneous 29,553 - - 29,553 Total Operating Revenues 630,141 485,522 1,115,663 Operating Expenses: Salaries and benefits Fuel and oil Maintenance and parts Contract services Software and supplies Depreciation expense Other Total Operating Expenses Operating Income (Loss) Nonoperating Revenues (Expenses): Interest revenue Gain (loss) on disposal of capital assets Total Nonoperating Revenues(Expenses) Income (Loss) Before Contributions and Transfers Capital contributions Transfers in Changes in Net Assets Net Assets: Beginning of Year End of Fiscal Year - 113,729 113,729 91,233 - 91,233 74,179 - - 74,179 16,242 34,622 42,310 93,174 - 105,841 - 105,841 176,647 97,821 529,952 804,420 - 8,934 - 8,934 358,301 360,947 572,262 1,291,510 271,840 124,575 (572,262) (175,847) 5,886 3,272 1,579 10,737 3,434 - - 3,434 9,320 3,272 1,579 14,171 281,160 127,847 (570,683) (161,676) - - 937,163 937,163 25,368 - 25,368 306,528 127,847 366,480 800,855 2,483,537 1,236,799 16,447,410 20,167,746 $ 2,790,065 $ 1,364,646 $ 16,813,890 $ 20,9681601 139 , n 264 CITY OF LA QUINTA COMBINING STATEMENT OF CASH FLOWS INTERNAL SERVICE FUNDS YEAR ENDED JUNE 30, 2012 Governmental Activities - Internal Service Funds Park Equipment Information Equipment Replacement Technology and Facilities Totals Cash Flows from Operating Activities: Cash received from customers and users $ 630,141 $ 485,282 $ - $ 1,115,423 Cash paid to suppliers for goods and services (230,464) (161,733) (49,279) (441,476) Cash paid to employees for services - (113,337) (113,337) Net Cash Provided (Used) by Operating Activities 399,677 210,212 (49,279) 560,610 Cash Flows from Non -Capital Financing Activities: Cash transfers in 25,368 - - 25,368 Net Cash Provided (Used) by Non -Capital Financing Activities Cash Flows from Capital and Related Financing Activities: Acquisition and construction of capital assets Proceeds from sales of capital assets Net Cash Provided (Used) by Capital and Related Financing Activities Cash Flows from Investing Activities: Interest received Net Cash Provided (Used) by Investing Activities Net Increase(Decrease)in Cash and Cash Equivalents Cash and Cash Equivalents at Beginning of Year Cash and Cash Equivalents at End of Year Reconciliation of Operating Income to Net Cash Provided (Used) by Operating Activities: Operating income (loss) Adjustments to reconcile operating income (loss) net cash provided (used) by operating activities: Depreciation (Increase) decrease in prepaid expense Increase (decrease) in accounts payable Increase (decrease) in accrued liabilities Increase(decrease)in compensated absences Total Adjustments Net Cash Provided (Used) by Operating Activities 25,368 (7,530) (29,693) 3,434 (4,096) (29,693) 25,368 (37,223) 3,434 (33,789) 6,384 13,581 1,862 11,827 6,384 3,581 1,862 11,827 427,333 184,100 (47,417) 564,016 1,612,086 918,064 700,455 3,230,605 $ 2,039,419 $ 1,102,164 $ 653,038 $ 3,794,621 $ 271,840 $ 124,575 $ (572,262) $ (175,847) 176,647 97,821 - (240) (48,810) (12,336) 94 298 529,952 804,420 - (240) (6,969) (68,115) 94 298 127,837 85,637 522,983 736,457 $ 399,677 (49,279) $ 560,610 Non -Cash Investing, Capital, and Financing Activities: Capital assets contributed by other funds 1 $ $ - $ 937,163 $ 937,163 140 it 265 AGENGYFUNDS Agency funds are used to account for assets held by the City as an agent for individual, private organizations and other governmental units. The agency funds and their purposes are as follows: The City of La Quinta has the following agency funds: Assessment District No. 97-1 and 2001-1 — To account for assessments paid to the City for debt service payments on bond issues used to finance sewer improvements. 141 266 �Y CITY OF LA QUINTA COMBINING BALANCE SHEET ALL AGENCY FUNDS JUNE 30, 2012 Assessment Assessment District No. District No. 97-1 2001-1 Totals Assets: Pooled cash and investments $ 128,183 $ 422,049 $ 550,232 Receivables: Taxes - 9,041 9,041 Accrued interest 39 125 164 Total Assets $ 128,222 $ 431,215 $ 559,437 Liabilities: Deposits payable $ 128,222 $ 431,215 $ 559,437 Total Liabilities $ 128,222 $ 431,215 $ 559,437 142 it 267 CITY OF LA QUINTA COMBINING STATEMENT OF CHANGES IN ASSETS AND LIABILITIES ALL AGENCY FUNDS YEAR ENDED JUNE 30, 2012 Balance Balance 7/1/2011 Additions Deductions 6/30/2012 Assessment District No. 97.1 Assets: Pooled cash and investments $ 135,326 $ 63,267 $ 70,410 $ 128,183 Receivables: Taxes 1,210 - 1,210 - Accrued interest Total Assets 92 136,628 39 92 39 128,222 71,712 63,306 Liabilities: Deposits payable $ 136,628 $ 61,944 $ 70,350 $ 128,222 Total Liabilities $ 136,628 $ 61,944 $ 70,350 $ 128,222 Assessment District No. 2001-1 Assets: Pooled cash and investments $ 385,866 $ 244,640 $ 208,457 $ 422,049 Receivables: Taxes 12,153 9,041 12,153 9,041 Accrued interest 262 398,281 125 262 125 431,215 220,872 253,806 Total Assets Liabilities: Deposits payable $ 398,281 $ 241,615 $ 208,681 $ 431,215 Total Liabilities $ 398,281 $ 241,615 $ 208,681 $ 431,215 Totals - All Agency Funds Assets: Pooled cash and investments $ 521,192 $ 307,907 $ 278,867 $ 550,232 Receivables: Taxes 13,363 9,041 13,363 9,041 Accrued interest 354 164 354 164 Total Assets $ 534,909 $ 317,112 $ 292,584 $ 559,437 Liabilities: Deposits payable $ 534,909 $ 303,559 $ 279,031 $ 559,437 Total Liabilities $ 534,909 $ 303,559 $ 279,031 $ 559,437 143 268 THIS PAGE INTENTIONALLY LEFT BLANK 144 "n 269 STATISTICAL SECTION This part of the City of La Quinta's comprehensive annual financial report presents detailed information as a context for understanding what the information in the financial statements, note disclosures, and required supplementary information says about the government's overall financial health. Contents Financial Trends Page These schedules contain trend information to help the reader understand how the govemment's financial performance and well-being have changed over time. 146 Revenue Capacity These schedules obtain information to help the reader assess the government's most significant local revenue source, the property tax. 158 Debt Capacity These schedules present information to help the reader assess the ability of the government's current levels of outstanding debt and the government's ability to issue additional debt in the future. 164 Demographic and Economic Information These schedules offer demographic and economic indicators to help the reader understand the environment within which the government's financial activities that take place. 171 Operating Information These schedules contain service and infrastructure data to help the reader understand how the information in the government's financial report relates to the services the government provides and the activities it performs. 174 145 ,4 270 CITY OF LA QUINTA Net Assets by Component Last Ten Fiscal Years (accrual basis of accounting) Fiscal Year 2003 2004 2005 2006 2007 Govemmental activities: Invested in capital assets, net of related debt $ 225,818,022 $ 249,059,500 $ 233,361,129 $ 253,569,117 $ 300,220,033 Restricted 40,038,313 44,415,966 43,421,857 65,159,623 49,277,895 Unrestricted 48,290,000 45,169,328 60,361,071 86,129,376 106,939,577 Total governmental activities net assets $ 314,146,335 $ 338,644,794 $ 337,144,057 $ 404,848,116 $ 456,437,505 Business -type activities: Invested in capital assets, net of related debt $ - $ - $ 41,300,846 $ 42,075,172 $ 42,692,025 Restricted - - - - - Unrestricted - (626,658) (1,665,646) (2,385,462) Total business -type activities net assets $ - $ - $ 40,674,188 $ 40,409,526 $ 40,306,563 Primary government: Invested in capital assets, net of related debt $ 225,818,022 $ 249,059,500 $ 274,661,975 $ 295,634,289 $ 342,912,058 Restricted 40,038,313 44,415,966 43,421,857 65,159,623 49,277,895 Unrestricted 48,290,000 45,169,328 59,734,413 84,463,730 104,554,115 Total primary government net assets $ 314,146,335 $ 338,644,794 $ 377,818,245 $ 445,257,642 $ 496,744,068 Source: City of La Quinta 146 , .271 TABLE 1 2008 2009 2010 2011 2012 $ 343,019,328 $ 323,669,955 $ 336,459,272 $ 276,787,752 $ 534,388,479 86,041,189 105,297,168 96,332,870 107,042,126 26,585,382 79,642,102 96,654,981 77,187,433 97,009,428 89,832,811 $ 508,702,619 $ 525,622,104 $ 509,979,575 $ 480,839,306 $ 650,806,672 $ 42,778,015 $ 42,536,608 $ 42,879,482 $ 42,491,051 $ 42,105,683 (3,109,524) (3,937,454) (4,863,848) (4,918,951) (4,745,892) $ 39,668,491 $ 38,599,154 $ 38,015,634 $ 37,572,100 $ 37,359,791 $ 385,797,343 $ 366,206,563 $ 379,338,754 $ 319,278,803 $ 576,494,162 86,041,189 105,297,168 96,332,870 107,042,126 26,585,382 76,532,578 92,717,527 72,323,585 92,090,477 85,086,919 $ 548,371,110 $ 564,221,258 $ 547,995,209 $ 518,411,406 $ 688,166,463 147 272 CITY OF I -A OUINTA Changes in Net Assets Last Ten Fiscal Years (scCNal bale of acconming) Fiscal Year 2003 2004 2W5 20W 2007 Expenses: Governmental activities: $ 3,203,462 $ 4.319,778 $ 3,595,906 $ 6,229,871 $ 6,284342 General govemment 8,547,005 10,2%,463 8,512875 9,065,2" 12.724.100 Public safety 7321,825 1,446,999 1,157,141 1,426,033 4,299.453 Community services 19.W3,860 7526.977 5,752.239 5,906.915 77W,520 Planning antl development 6,785,759 8,0W,013 9,101,582 10,",335 10,511,874 PublicwnMs Contribution to other agencies 8,555,4u 9,658,779 15265,051 15,494,655 15,163,422 Interest an long-term debt 47,497.312 39,212,W9 43,384,794 46,129,054 56,719711 Total governmental activities eWensm business -type activities: - 1877291 4,523,146 4,520.173 Golf Course - - 1.877,291 4,523,146 4520, 173 Total business -type activities expenses 47.497,312 39,212009 45.262,0W 50,6522W 61239,884 Total primary government expenses Program revenues: - GovemmerM1al activities: Charges for ser4ces: 298,749 337,376 445,663 717849 60,530 General government 2.917,866 4,01M621 4,438,115 4.168,2W 2659,515 Public safety 611278 W2,737 7549W 1,873,676 169,643 painting and developrrx:nt 205,1W 252,677 252,501 428,947 387,W5 Community services 1,594,225 1,813,993 2,815,703 3,021379 2,244156 Public wogs 1,797,031 1,799,503 1,935,578 3,6W,173 3,796,495 Operating grants and contributions 5,1W,405 12,0W,143 18,591,423 33,918.901 17601,131 Capital grants and contributions Total 9ovenrinental activities 1251!5.3W 20,9(31,050 29,233921 47732131 26918,535 program revenues Business -type activities: Charges for services: - - 1,091,BW 3.120728 3,540,748 Goff Course Capital grants and contributions " Total business -type activities - 1091,836 3,120728 3,540,]4B program revenues Total primary government 12,585,360 20,W1p50 30,325,757 50,852859 30.459,283 program revenues (continued) (continued) (continued) (continued) (continued) Net revenues (e)ponses): (39.911952) (18,250.959) (14,750873) 1,402418 (29(979,176) Govemmeral activities - p85.455) (1402,418) 425 (W9425) Business -type activities (34911952) (18250.959) (149W328) 200.659 (30780W1) Total net revenues(expenses) General revenues and otlrer changes in net assets: Governmental adivines'. Taxes 1,aW616 2,198,141 2,579,245 3,679079 4,959,W1 Property taxes 21,191,832 24,450,337 24,443,112 35,168,329 42.5B3,031 Tax increment 4,345,381 5,240.037 6773,566 7,613.075 8,896716 Sales tax 40362W 4,261767 4,831,338 5,437,238 5,446,361 Transient occupancy taxes 693,544 895,810 1185W7 1,044,470 1.259,985 Franchise taxes 186.226 191,062 251618 276,917 307,032 Business license tams 513,934 675,998 1,141177 1049.701 872753 Otherhuda 1,353,836 1,738,505 4,336050 6,319,502 11,854.951 Investment incorrs 1768,091 1,608,151 2,453,642 2,740,233 3,291,055 Motor vehicle in lieu, unmoded - 3,717,470 1967,292 - Gain (loss) on sale of capital assets - 513,876 1489,612 2,397,474 1,943.093 2.052,246 Miscellaneous Damominary gainPoss on dissolution of RDA - " - (41459,6437+ (113], 203)+ (874645 ) Transfers 36,4W,652 42.749,418 12,6501W W,101726 W,6905W Total govemmental activities Business -type activities: - - 553 1,817 Investment incema " Gain (loss) an sale of capital assets _ _ 41 459,643 + 1,137,203 + 874645 Transfers - 41,459,643 1,137,]56 876462 Total business -type activities 364W,652 42.749,418 54109,779 67239,482 8, W.m Total primary government Changes in net assets 1,4W7W 24.498,459 (1,SW737) 67,704W3 W,889,360 Governmental activities 40,674.188 (264,652) (102,963) Business -type activities $ 14W,700 $ 24,496,459 $39.173,451 $ 6],440,141 $ 50,]W,397 Total primary government ' The transfer was for land & golf course arprovements transferred! to Me Enterprise Fund _ Source: City of La Oufnta ,48 P 273 TABLE 2 2008 2009 2010 2011 2012 $ 6,963,073 $ 7,838146 $ 34,287.068 $ 11,20,358 $ 6,183,712 13,472,036 19,736,941 21,274,519 21,070.458 20,815454 6,797,116 14,808,850 15,923,380 6,735,954 5,093.402 35,K3,858 7,317,689 5,173,326 18,715,283 6,378,352 11, 097,526 11,100,833 12,328726 10,757,279 13,288521 - - 31.324.064 - 15,522,441 16,631438 15,330,603 14,353359 3,021.4% 88166,050 76,431,897 104,315,622 112,239,765 54,780.937 4,761581 4,440,546 4, 169,768 4,202,274 4,085,282 4,761,581 4,440,546 4,169,768 4,202,274 4,085282 92,927,631 80,872,443 108,485,390 116,442,039 56,866219 8328 25,053 21439 47,6% 88869 2,050,492 1,373952 1.100,494 1,044399 1,020,822 134211 138,391 69,391 74,471 68470 374,092 275.178 250,557 210.151 247,397 1,900,437 1308702 1.124,647 1,M,771 1,080,744 5,905 664 10,725,280 15,363,650 13,152,942 11,289,673 50,090,419 10,647,270 5,974,311 3,157,828 9,99Q793 60,463643 24,493,826 23.904,486 18774258 23.784768 3,814,233 3.368,135 3,584,996 3,756.615 3,871,898 352,68] 4,168920 3,368135 3,5849% 3,758615 3,871,898 64630,563 27,861961 27,489,482 22,538873 27,656,666 (wMinued) (wMmW) (wMln.d) (wntinwd) (wntinued) (27,702,407) (51,938071) (80.411136) (93,4 ,507) (30,998169) (594,661) (1,072,411) (584,772) (445.659) (213,384) (2827% (53.010,482) (80,995,908) (93911,166) (312 ,553) 6,014305 6,653,583 6.278,470 5,942,353 21,370,476 42,114,893 36702,197 35390,317 32,569,795 - 8,492,213 7,279,513 8927.388 7323,835 7,]13,741 5,327,203 4480,467 4.2 ,438 4,737,968 5,446,883 1,748,082 1,533249 1585427 1,607.829 1 68],440 317.011 285,304 302,223 285,270 293,592 641,705 455089 461,957 437,235 428,953 10,230,489 7,387,244 5,362,684 460,974 1,925,255 3,803,647 3.WW1 3.714,437 3,515,30 3,173.826 57,346 21,542 2,330 - - 1,220,627 118.567 477,935 3,211,584 268544 - - - - 158,654715 79,%7,521 68,857,5% 64,768607 84325,238 200,963,535 4,310 3,074 1.252 2.125 1,075 (47,721) - - - - (43.411) 3,076 1,252 2.125 1,075 79.924,110 68660,630 G4769,859 64327,363 200,9 ,610 52,265.114 16,919,485 (15,642,529) (29.140,269) 169,967,366 (638,072) (1 ON 337) (583,520) (443,534) (212,309) $ 51,627,042 $ 15,650, 148 $ (16,226.049) $ (29,583,803) $ 169,755,057 149 274 Expenses: General government Public safety Community services Planning and development Public vrorks Contribution to other agencies Interest on long-term debt Total governmental activities expenses Program revenues: Charges for services: General government Public safety Community services Planning and development Publicworks Operating grants and contributions Capital grants and contributions Total governmental activities CITY OF LA OUINTA Changes in Net Assets - Governmental Activities Last Ten Fiscal Years (accrual basis of accounting) 2003 2004 2005 2006 2007 $ 3,203,462 $ 4,319,778 $ 3,595,906 $ 4,229,871 $ 6,284,342 8,547,005 10,256,463 8,512,875 9,065,244 12,724,100 1,321,825 1,446,999 1,157,141 1,426,033 4,299,453 19,083,860 7,526,977 5,752,239 5,906,915 7,736,520 6,785,759 6,003,013 9,101,582 10,006,335 10,511,874 8,555,401 9,658,779 15,265,051 15,494,656 15,163,422 47,497,312 39,212,009 43,384,794 46,129,054 56,719,711 298,749 337,376 445,663 717,849 60,530 2,917,866 4,004,621 4,438,115 4,168,206 2,659,515 205,806 252,677 252,501 428,947 387,065 611,278 662,737 754,938 1,873,676 169,643 1,594,225 1,813,993 2,815,703 3,021,379 2,244,156 1,797,031 1,799,503 1,935,578 3,603,173 3,796,495 5,160,405 12,090,143 18,591,423 33,918,901. 17,601,131 program revenues 12,585,360 Net program revenues (expenses) (34 911,952) General revenues and other changes in net assets: Taxes: Property taxes 1,800,616 Tax increment 21,191,832 Sales lax 4,345,381 Transient occupancy taxes_ 4,036,290 Franchise tax 690,544 Business license taxes 186,220 Othertax 513,934 Motor vehicle in lieu, unrestricted 1,768,091 Investment income 1,353,868 Gain (loss) on sale of capital assets - Miscellaneous 513,876 Extraordinary gain/loss on dissolution of RDA - Transfers Total governmental activities 36,400,652 Changes in net assets - governmental activities Source: City of La Ouinta 20,961,050 (18 250,959) 2,198,141 24,450,337 5,240,037 4,261,767 895,810 191,062 675,996 1,608,151 1,738,505 1,489,612 29,233,921 (14,150,873) 2,579,245 24,443,112 6,773,566 4,831,338 1,185,087 251,618 1,141,177 2,453,642 4,336,050 3,717,470 2,397,474 (41,459,643) 42,749,418 12,650,136 $ 1,488,700 $ 24,498,459 47,732,131 1,603,077 3,679,079 35,168,329 7,613,075 5,437,238 1,044,470 276,917 1049701 2740233 6319502 1967292 1943093 0 (1,137,203 66,101,726 26,918,535 (29,801,176) 4,999,051 42,583,031 8,896,716 5,448,361 1,259,985 307,032 872,753 3,291,055 11,854,951 2,052,246 (874,645) 80,690,536 $ (1,500,737) $ 67,704,803 $ 50,889,360 275 150 Table 3 2008 2009 2010 2011 2012 $ 6,953,073 $ 7,836,146 $ 34,287,068 $ 11,283,358 $ 6,183,712 13,472,036 19,736,941 21,274,519 21,070,458 20,815,454 5,797,116 14,808,850- 15,923,380 4,735,964 5,093,402 35,323,858 7,317,689 5,173,326 18,715,283 6,378,352 11,097,526 11,100,833 12,326,726 10,757,279 13,288,521 - - - 31,324,064 - 15,522,441 15,631,438 15,330,603 14,353,359 3,021,496 88,166,050 76,431,897 104,315,622 112,239,765 54,780,937 8,328 25,053 21,439 47,696 86,869 2,050,492 1,373,952 1,100,491 1,044,399 1,020,822 374,092 275,178 250,557 210,151 247,397 134,211 138,391 69,391 74,471 68,470 1,900,437 1,308,702 1,124,647 1,086,771 1,080,744 5,905,664 10,725,280 15,363,650 13,152,942 11,289,673 50,090,419 10,647,270 - 5,974,311 3,157,828 9,990,793 60,463,643 24,493,826 23,904,486 18,774,258 23,784,768 (27,702,407) (51,938,071) (80411,136) (93,465,507) (30,996,169) 6,014,305 6,653,583 6,278,470 5,942,353 21,370,476 42,114,893 36,702,197 35,390,317 32,569,795 - 8,492,213 7,279,513 6,927,388 7,323,835 7,713,741 5,327,203 4,480,467 4,265,438 4,737,968 5,446,883 1,748,082 1,533,249 1,585,427 1,607,829 1,687,440 317,011 285,304 302,223 285,270 293,592 641,705 455,089 461,957 437,235 428,963 3,803,647 3,940,801 3,714,437 3,515,395 3,173,826 10,230,489 7,387,244 5,362,684 4,693,974 1,925,255 57,346 21,542 2,330 - - 1,220,627 118,567 477,936 3,211,584 268,644 - - - - 158,654,715 79,967,521 68,857,556 64,768,607 64,325,238 200,963,535 $ 52,265,114 $ 16,919,485 $ (15,642,529) $ (29,140,269) $ 169,967,366 151 276 CITY OF LA OUINTA TABLE 4 Changes in Net Assets - Business -type Activities Last Eight Fiscal Years (accrual basis of accounting) Fiscal Year 2005 2006 2007 2008 2009 2010 2011 2012 Expenses: Golf Course 1,677,291 4 4,523,146 4,520,173 4,761.581 4,440,546 4,169,768 4,202,274 4,085,282 Total business -type activities expens 1,877,291 4,523,146 4,520,173 4,761,581 4,440,546 4,169,768 4,202,274 4,085,282 Program revenues: Charges for services: Golf Course 1,091,836 Y 3,120,728 3,540,748 3,814,233 3,368,135 3,584,996 3,756,615 3,871,898 Capital grants and contributions 352,687 - - - Total business -type activities program revenues 1,091,836 3,120,728 3,540,748 4,166,920 3,368,135 3,584,996 3,756.615 3,871,898 Net revenues (expenses) (785.455) (1,402,418) (979.425) (594,661) (1,072,411) (584,772) 445.659) (213,384) General revenues and other changes in net assets: Investment income - 553 1,817 4,310 3,074 1,262 2,125 1,075 Gain (loss) on sale of capital asse - - - (47,721) - - - - Transfers - 164,190 874,645 - - - - Capital contributions 41,459,643 973,013 979,425 - - - - Totalbusiness-typeactivities 41.459,643 1,137,766 1,855,887 43,411) 3,074 1,252 2,125 1,075 Changes in net assets - business -type 40,674,188 264,662 876,462 638,072 1,069,337 58( 3.520) 443,534 21( 2,309) activities The City a(La Quinto implemented the business type activities in FY 200412005. The transfer was for land & golf course improvements transferred to the Enterprise Fund. This was the first full year of operations for the Golf Course Source: City of La Quints 152 II 277 THIS PAGE INTENTIONALLY LEFT BLANK -w- 278 153 General fund: Nonspendable: Prepaid costs Land held for resale Notes and loans Advances to other funds Deposits Restricted for: Debt service Committed: Emergency reserve Post retirement health benefits Capital Projects Educational purposes Library Economic development Assigned: Continuing appropriations Unassigned: Total general fund All other governmental funds: Nonspendable: Prepaid costs Land held for resale Notes and loans Advances to other funds Deposits Restricted: Planning and development projects Public safety Community services Public works Capital Projects Debt service - Assigned: Continuing appropriations Unassigned: CITY OF LA QUINTA Fund Balances of Governmental Funds Last Ten Fiscal Years (modified accrual basis of accounting) Fiscal Year 2003 2004 2005 2006 2007 $ 17,515 $ 292,816 $ 507,931 $ 503,642 $ 11,774 21,081,322 28,671,083 31,904,659 22,700,961 27,597,329 1,073 246,858 5,903 10,523,200 11,915,000 15,067,577 16,905,386 18,722,524 - - 589,875 10,877,058 482,718 - - 1,000,000 750,000 500,000 - - 11,981 - - - - 467,072 4,967,072 2,327,430 1,069,667 1,319,787 2,257,200 16,061,573 13,579,479 13,308,205 18,239,315 32,741,545 $ 47,684,683 $ 54,705,236 763,926,967 7 76,2 99,124 $ 84,640,520 $ _ $ - $ _ $ 7,987 $ 7,977 2,117,586 2,123,425 2,117,873 2,112,597 2,081,645 3,811,874 5,336,158 7,061,027 5,365,097 4,823,543 185,000 - 1,110 - - 7,903,406 7,518,862 16,144,465 26,172,191 15,297,481 40,208 8,413 154,115 143,846 153,818 996,814 1,359,723 2,889,245 9,696,885 12,214,375 374,700 409,534 256,881 462,171 104,878 50,673,421 124,658,452 99,186,105 92,112,917 66,225,066 2,273,588 4,093,123 4,605,101 10,288,494 24,309,220 (10,403,485) (20,244,236) (18,801,305) (7,133,230) (7,854,868) Total all other governmental funds $ 57,973,112 $125,263,454 $113,614,617 $ 139,228,955 $117,363,135 The increase was primarily the result of the issuance of the 2004 Financing Authority bonds. In Fiscal Year 2009-2010, the City implemented GASB 54 which changed the reporting requirements for fund balances in the financial statements. This table has been updated to reflect the impact of GASB 54 not only for Fiscal Year 2009-10 but for all prior years. The increase was primarily the result of the issuance of the 2011 Financing Authority bonds. Source: City of La Quinta 154 279 TABLE 5 2008 2009 2010 2011 2012 $ 10,601 $ 12,424 $ 9,030 $ 23,260 $ 27,481 - - 8,320,000 8,320,000 45,264,966 46,137,692 57,897,671 15,373,104 15,417,929 4,825 9,830 9,830 9,967 118,516 - 169,631 173,426 19,651,824 18,201,948 17,774,648 18,018,595 17,516,295 2,100,000 2,144,085 1,258, 059 - 1,258,059 _ 1, 523,401 250,000 _ _ 1,911,131 _ _ - - 2,835,297 3,485,747 1,555,176 1,768,494 1,657,694 20.423.375 22,335,655 13,525,704 48,140,444 47,121,339 $ 92,452,519 $ 92,327,38 1 $ 92,030,118 $ 93,081,554 $ 91,876,081 $ 5,353 $ 19,197 $ 7,740 $ 10,563 $ _ 2,076,063 2,067,028 2,088,709 2,081,614 2,065,611 4,402,213 4,321,119 4,293,166 4,569,188 _ - 4,540 6,400 6,000 _ 21,906,749 25,807,752 31,032,124 34,018,930 2,724,240 198,843 245,468 48,852 96,364 245,187 11,406, 628 11, 387, 631 11, 675,417 10, 248, 314 11,162, 057 309,566 7,539,181 448,731 396,355 145,823 69,626,275 50,556,856 53,123,856 58,111,106 a 4,089,156 5,094,635 5,490,098 3,890 4,001,426 2,534 2,000 _ _ (19,653,179) (19,339,823) (33,626,907) (13,250,398) (5,988,442) $ 95,373,146 $ 88,101,047 $ 69,101,978 $ 100,289,462 $ 14,446,166 155 �., 280 Revenues: Taxes Assessments Licenses and permits Intergovernmental Charges for services Use of money and property Contributions Developer participation Miscellaneous Total revenues Expenditures Current: General government Public safety Planning and development Community services Public works Capital projects Debt service: Principal retirement Interest and fiscal charges Payment to bond escrow Payments under pass -through obligations Total expenditures Excess (deficiency) of revenues over (under) expenditures Other financing sources (uses): Issuance of tax allocation bonds Issuance of revenue bonds Payment to bond escrow Transfers in Transfers out Other debts issued Capital leases Proceeds from sale of capital assets Total other financing sources (uses) Extraordinary gainfloss on dissolution of redevelopment agency Net change in fund balances Debt service as a percentage of noncapital expenditures Source: City of La Quinta CITY OF LA QUINTA Changes in Fund Balances of Governmental Funds Last Ten Fiscal Years (modified accrual basis of accounting) Fiscal Year 2003 2004 2005 2006 2007 $ 50,326,811 $ 58,301,082 $ 68,175,347 $ 89,704,947 $ 100,103,324 780,259 816,045 825,292 818,526 877,191 1,982,127 3,096,145 3,226,167 5,145,430 2,788,882 7,194,521 11,858, 627 10,242,876 18, 585,468 14,803,971 2,302,759 2,619,578 3,402,602 3,367,989 1,821,794 4,463,219 4,854,728 9,798,356 12,671,662 14,804,348 3,021,245 5,718,073 6,091,156 12,473,440 5,310,440 483,777 1,359,539 528,903 637,054 412,353 70,554,718 88,623,817 102,290,699 143,404,516 140,922,303 3,344,407 4,099,376 3,970,921 4,644,954 6,150,699 8,344,428 9,672,708 12,364,583 13,029,187 15,685,493 7,804,294 7,480,421 5,719,373 5,847,563 28,994,177 993,964 1,025,397 1,104,509 1,248,308 4,027,302 3,685,050 4,536,589 6,206,769 6,987,014 6,755,507 16,057,578 43,331,919 40,012,387 25,445,550 36,420,417 2,931,952 3,610,538 3,793,660 4,777,748 5,647,940 9,469,314 13, 961, 721 14,355,577 15, 554, 612 15,059,977 - 1,591,107 - - - 17,561,994 21,448,147 25,756,321 35,958,291 36,498,575 70.192,981 110,757,923 . 113,284,100 113,493,227 155,240,087 361,737 _ (22,134,106) (10,993,401) 29,911,289 _ (14,317,784) - 26,400,000 - 90,000,000 - (19,955,000) 23,887,256 154,613,662 (23,887,256) (154,613,662) 49,248,081 35,828,335 60,954,576 (49,248,081) (35,992,525) (60,954,576) 8,566,295 8,209,396 124,097 96,445,000 8,566,295 8,045,206 124,097 $ 361,737 $ 74,310,894 $ (2,427,106) $ 37,956,495 $ (14,193,687) 43.5"/u 57.9% 62.0% 65.5% 61.0% 156 r 281 TABLE 6 2008 2009 2010 2011 2012 $ 105,870,933 $ 99,816,072 $ 93,831,918 $ 88,498,457 $ 53,632,023 909,229 927,816 966,639 956,048 950,292 2,107,035 871,167 472,409 547,071 482,831 15,382,135 18,679,355 19,473.076 19,005,643 15,875,582 1,334,060 673,779 484,043 501,418 635,111 12.874,926 7,043,646 5,338,679 4,670,732 1,914,516 37,643,190 240,591 395,823 327,751 303,773 6,537,991 2,243,785 273,739 945,805 903,144 629,471 720,185 608,342 319,763 276,327 183,288,970 131,216,396 121,844,668 115,772,688 74,973,601 7,367,144 7,230,436 30,220,882 10,885,519 4,881,922 17,181,775 18,946.866 20,116,936 19,826,372 19,669,517 15,374,160 7,261,835 6,028,492 8,460,420 4,314,646 5,336,757 4,698,985 4,204,626 4.147,758 4,086,686 6,563,494 6,324,055 6,862,887 4,808,060 6,192,733 82,883,317 32,363,859 14,514,910 21,287,775 13.335,989 5,949,311 6,319,580 6,616,412 7,011,261 7,066,726 15,424,708 15,348,598 15,357,968 15,037,919 6,701,079 42,989,023 42,426,670 38,710,894 35,607,089 16,755,441 199,069,689 140,920,884 142,634,007 127,072.173 83,004,739 (15,780,719) (9,704,488) (20,789,339) (11,299,465) . (8,031,138) - - - 6,000,000 - - - - 28,850,000 - 88,604,682 40,502,929 30,386,372 61,657,034 12,554,752 (87,342,608) (40,527,930) (28,893,365) (61,652,479) (12,580,120) - 2,332,752 - - - 182,094 - - - - 158,061 - - 8,683,850 875,275 1,602,229 2,307,751 1,493,007 43,538,405 849,907 (79,05055) $ (14,178,490) $ (7,396,737) $ (19,296,332) $ 32,238,920 $ (86,239,486) 47.1% 59.0% 47.6% 53.0% 43.8% 157 }! 282 CITY OF LA QUINTA TABLE 7 Assessed Value and Estimated Actual Value of Taxable Property Last Ten Fiscal Years (in dollars) Entire Citv (including Redevelopment Aoenc Fiscal Year Ended June 30 Secured Unsecured Less: Exemptions Taxable Assessed Value Direct Rate 2003 $ 3,789,678,041 $ 32,607,713 $ (54,726,303) $ 3,767,559,451 0.83181 2004 5,412,382,710 40,940,877 (95,420,075) 5,357,903,512 0.83002 2005 6,289,493,552 44,014,548 (113,037,003) 6,220,471,097 0.80909 2006 7,856,383,375 72,554,357 (115,071,146) 7,813,866,586 0.77208 2007 9,986,151,525 88,740,840 (99,245,721) 9,975,646,644 0.73007 2008 11,854,669,637 101,433,002 (89,688,505) 11,866,414,134 0.68950 2009 12,410,626,893 113,185,065 (107,777,195) 12,416,034,763 0.67747 2010 11,742,665,902 121,272,880 (110,752,890) 11,753,185,892 0.66997 2011 10,913.083,169 118,972,704 (161,265,140) 10,870,790,733 0.67058 2012 10,400,897,792 107,421,771 (176,887,605) 10,331,431,958 0.67169 NOTE: In 1978 the voters of the State of California passed Proposition 13 which limited, property taxes to a total maximum rate of 1 % based upon the assessed value of the property being taxed. Each year, the assessed value of property may be increased by an "inflation factor" (limited to a maximum increase of 2%). With few exceptions, property is only re -assessed at the time that it is sold to a new owner. At that point, the new assessed value is reassessed at the purchase price of the property sold. The assessed valuation data shown above represents the only data currently available with respect to the actual market value of taxable property and is subject to the limitations described above. Source: County of Riverside Auditor -Controller 158 . 1" 283 CITY OF LA QUINTA TABLE 8 Assessed Value and Estimated Actual Value of Taxable Property - Redevelopment Agency Last Seven Fiscal Years (in dollars) Redevelopment Agency Project Area 1 Fiscal Year Taxable Ended Less: Assessed Base Taxable June 30 Secured Unsecured Exemptions Value Year Increment 2006 $ 3,962,433,928 $ 29,248,534 $ (35,653,495) $ 3,956,028,967 $ 199,398.233 $ 3,756,630,734 2007 4,789,836,901 34,084,343 (36,081,051) 4,787,840,193 199,398,233 4,588,441,960 2008 5,223,508,114 34,250,061 (36,913,004) 5,220,845,171 199,398,233 5,021,446,938 2009 5,259,271,091 31,678,492 (36,844,457) 5,254,105,126 199,398,233 5,054,706,893 2010 4,925,639,242 36,169,030 (36,077,902) 4,925,730,370 199,398,233 4,726,332,137 2011 4,627,126,186 35,335,685 (35,822,516) 4,526,639,355 199,398,233 4,327,241,122 2012 4,261,084,382 31,435,346 (35,246,900) 4,257,272,828 199,398,233 4,057,874,595 Redevelopment Agency Project Area 2 Fiscal Year Taxable Ended Less: Assessed Base Taxable June 30 Secured Unsecured Exemptions Value Year Increment 2006- $ 2,132,426,502 $ 32.999,788 $ (54,125,422) $ 2,111,300,868 $ 95,182,755 $ 2,016,118,113 2007 2,434,082,787 42,914,862 (53,144,959) 2,423,852,690 95,182,755 2,328,669,935 2008 2,764,306,278 50,616,017 (40,774,044) 2,774,148,251 95,182,755 2,678,965,496 2009 2,843,981,136 62,180,440 (57,076,727) 2,849,084,849 95,182,755 2,753,902,094 2010 2,641,339,455 66,270,232 (60,340,787) 2,647,268,900 95,182,755 2,552,086,145 2011 2,522,266,207 60,448,173 (110,797,044) 2,471,917,336 95,182,755 2,376,734,581 2012 2,467,196,690 59,615,560 (127,142,123) 2,399,670,127 95,182,755 2,304,487,372 Source: County of Riverside Auditor -Controller Note: The information was first presented in Fiscal Year 2006. r,• 284 159 CITY OF LA QUINTA Direct and Overlapping Property Tax Rates (Rate per $100 of assessed value) Last Seven Fiscal Years City Redevelopment Nan -Project Area Project Area 1 1 20D8 1 200] 1 2008 1 2009 1 2010 1 2011 1 2012 J 2006 3 2007 4 2008 4 2009 4 2010 4 2011 Direct Rates: City of to Quanta 0.0760 0.0760 0.0760 0.0506 0.0506 0.0734 0.0760 0.0000 0.0000 0.0000 0.0152 0.0036 0.0049 Redevelopment agency Project Area l 0.0000 0.t1000 0.0000 0.0000 0.0000 0.0W 0,0000 0.5830 0.5880 0.5150 0.5245 0.5432 0.5310 Redevelopment agency ProjectArea 2 0.0000 0.DD00 0.0000 0.0000 0.0000 0.0000 0.0000 0.0000 0.0000 0.0000 0.0000 0.0000 0,0000 County of Riverside 0.1%0 0.1960 0.1960 0.2586 0.2586 0.2318 0.1957 0.2639 0.2619 0.2619 0.2325 02501 0.2471 County Free Library, 0.OM 0.0250 0.0250 0.0284 0.0284 0.0280 0.0252 0.0276 0.0276 0.0276 0.0277 0.0276 0.0262 County Structure Fire Protection 0.0540 0.0540 0.0540 0.0610 0.0610 0,0602 0.0544 0.0595 0.0595 0.0595 0.0595 0.0595 0.0607 Coadialla Valley (CV) Unified Shcool 0.0000 0.0000 0.0000 0.0000 0.0000 0.0000 0.4322 0.0170 0.0150 0.0020 0.0149 0.0167 0.0182 Desert Sands United School 0.4320 0.4320 0.4320 0.3765 0.3765 0.3716 0,0000 0.0160 00140 0.0140 0.0695 0.0568 0.0637 Desert Community College 0.0700 0.0700 0.0700 0.0782 0.0782 0.0772 0.06% 0.0030 0.0030 0.0720 0.0177 0.0152 0.0166 Riverside County Office of Education 0.0380 0.0380 0.0380 0.0426 0.0426 0.0420 0.0380 0.0030 0.0030 0.0180 0.0093 0.0027 0.0038 Riverside County Regional Park B Open Space 0.0040 0.0040 0.0040 0.0000 0.0000 0.0000 0.0040 0."0 0.0000 0.0030 0.0000 0.0000 0.0000 CV Public Cemetery 0.0032 0.0032 0.0032 0,0035 0.0035 0.0035 0.0032 0.0000 0.D0D0 0.0000 0.0008 0.0002 0.0003 CV Mosquito 0.0127 0.0127 0.0127 0.0142 0.0142 0.0141 0.0127 0.0120 0.0120 0.0120 0.0112 0.0111 0.0112 Desert Recreabon District 0.0192 0.0192 0.0192 0.0215 0.0215 0.0213 0.0192 0.0010 0.0020 0.0010 0.0044 0.0014 0.0019. CV Water District 0.0250 0.0250 0.0250 00284 0.0264 0.0281 0.0254 0.0130 0.0130 0.0010 0.0127 0.0120 0.0124 CV Resource Conservagou 0.0003 0.D003 0.0003 0.0004 0.0004 0.0004 0.0003 0.0000 0.0000 00130 0.0001 0.0000 0.0000 CVWD District 1 Debt Service 0.0118 0.0118 0.0118 0.0DD0 0.0000 0.0131 0.0118 00000 0,0000 0.0000 0.0000 0.0000 0.0000 CVWD Stoop Water Umt 0.0320 0.0320 0.0320 0.0360 0.0360 0.0355 0.0321 00010 0,0010 0.0000 00000 0.0000 0.01= Total Direct Rate 0.9992 0.9992 0.9992 1.0000 1.0000 1.0000 1.0000 1.0000 1.0000 1.D000 1.0000 1.0000 1.0D00 Tax Rate Area 02(F005 020-005 020.005 020-005 020-005 02 005 020-005 020-015 020015 020-089 020-089 020-089 020-089 Overlapping Rates': City of La Claims County of Riverside Riverside County Office of Education RNelside County Pension Obligaboo Desert Sands Unified 0.0767 0.0761 0.0799 0.0799 0.0811 0.1004 0.0757 0.0767 0.0761 0.07% 0,0799 0.0811 0.1004 Coachella Valley Unified School District Coachella Valley Water District 0.0442 0,0332 0.0462 0.0464 0.0660 0.0860 0.0562 0.0199 0.0208 0.0484 0.0464 0.0660 0.0860 Coachella Valley Re nation 6 Park District Desert Comm College District 0.0199 0.0199 0.0199 0.0199 0.0200 0.0200 0.0079 0.0208 0.0199 0.0199 0.0199 0.0200 0.0200 Total Overtopping Rate 0.1409 0.120 0.1461. 0.1462 0.1671 0.2063 0A698 0.1175 0.1169 0.1440 0.1462 0.1671 0.2063 Total Direct and Overlapping Rate 1.1401 1.1285 1A453 1.1462 1AU1 1.2063 1.1697 1.1175 1.1169 1.1440 1.1463 1.1671 1.2063 NOTE' In 1979, Culifumu calm pesud hapmiuon 13 which axs the prquary tart na at a I Orytt, fixed umwm fa direct axis. Thu Lei o is sbvM by all taxing agenda frt winch the subleet Waterer, mines amha, Source: County of Riverside Auditor Controller's Once Direct rate from Tax Rate Area (TRA) 020-059 provided by Hdi Conn 8 Cone and overlapping debt rates from Califomia Municipal Statul cs Direct rate taken from all non -RDA TRA's provided by the County of Riverside and do not include ERAF deductions and overlapping rates provided by California Municipal Stafisbcs u Direct rate taken from an analysis by the City of La Ouinta Finance Department staff of all TRA's In the Project area and do not include Stale ERAF deductions and overlapping ales provided by Calffomia Municipal Statistics 4 Dared read taken from an analysis of the TRA in the Project area and do not include State ERAF deductions and overlapping rates provided by California Municipal Statlssgcs s Overlapping rates are based upon a single tax rate area only. Note: The information vr4s first presented in Fiscal Year 2D06. 160 " 285 TABLE 9 Re .e Iop t P oje Area 2 20124 20063 20073 20084 20094 20104 20114 20124 0.0524 O.0000 0.0000 0.0000 0.0000 0.0000 0.0018 0.0499 0.0009 0.000o 0.0000 0.0000 0.0000 0.0o00 0.0000 0.0000 0.286D 0.2920 0.2910 0.3193 0.3174 0.3059 0.0000 0.2683 0.2617 0.2617 0.2617 0.2516 0.2537 0.2511 02553 0.0294 0.0280 0.0280 0.0280 0.0280 0.0280 0.0286 0.0280 0.0633 0.0603 0.0603 0.0603 0.0603 0.0603 0.0616 0.0602 0.0000 0.0000 0.0000 0.0020 0.0000 0.0000 0.0000 0.0000 0.3905 0.2000 0.1980 0.1920 0.1860 0.1859 0.1930 0.3716 0.0812 0.0420 0.0410 0.0410 0.0386 0.0386 0.0401 O.M2 0.0442 0.0230 0.0220 0,0220 0.0210 0.0210 0.0218 0.0420 0.0000 0.0000 0.0000 0.0000 0.0000 0.0000 0.0000 0.0037 0.0000 0.0000 0.0000 0.0000 0.0000 0.0001 0.0035 0.0148 0.0150 0.0140 0.0140 0.0141 0.0141 0.0141 0.0140 0.0223 O.OWO MOM 0.0060 0.0053 0.0053 0.0059 0.0212 0.0295 0.0770 0.0760 0.0760 0.0757 0.0757 0.0T40 0.0281 0.0W 0.0000 0.0000 0.0000 0.0000 0.0000 0.0000 0.0004 0.0000 0.0000 0.0000 0.0000 0.0000 0.0000 0.0005 0.0131 0.0000 0.0010 0.0010 0.0010 0.0000 0.0000 0.0014 0.0355 1.000o 1.0000 1.0000 1.0000 1.0000 1.0000 1.0000 1.0000 020-089 020-144 020-144 02 144 O2 144 020 144 O2 144 M2 144 0.0757 0.0767 0.0761 0.07% 0.0799 00811 0.1004 0.0757 0.0862 0.0442 0.0332 0.0484 0.0464 0.0660 0.0860 0.0862 0.0079 0.0199 0.0199 0.01% 0.0199 0.0200 0.0200 0.0079 OAM 0.1409 0.1293 0.1440 0.1462 0.1671 0.2063 0.1698 1.1698 1.1409 1.1293 1.1440 1.1462 1.1671 1.2063 1.1698 161 286 CITY OF LA QUINTA TABLE 10 Principal Property Taxpayers Current Year and Nine Years Ago (in dollars) 2012 2003 Percent of Percent of Total City - Total City Taxable Taxable Taxable Taxable Assessed Assessed Assessed Assessed Taxpayer Value Rank Value Value Rank Value KSL Desert Resort, Inc $ 140,972,125 1 1.30% $ 223,561,771 1 4.85% TO Desert Development 97,885,896 2 0.90% 23,396,068 3 0.51% MSR Resort Golf Course - 55,063,175 3 0.51% East of Madison LLC 43,291,518 4 0.40% - Inland American La Quinta Pavilion 42,548,545 5 0.39% - Coral Option I LLC 42,113,733 6 0.39% - W RM La Quinta 37,973,210 7 0.00% - Gri%in Ranch 35,404,2188 0.33% 13,279,487 10 0.29% Walmart Stores 29,352,870 9 - TO Desert Development LP 25,918,559 10 0.24% 16,452,860 5 0.36% Quarry at La Quinta Inc - 20,310,518 4 0."% Toll California V 33,241,643 2 0.72% Monticello CCC 15,050,496 6 0.33% Spanos Corporation - - 15,048,480 7 0.33% M&H Realty Partners II - 14,824,567 8 0.32% SRHI - - 14,095,924 9 0.31% $ 550,523,849. 4.46% $ 389,261,814 8.46% Source: HdL Coren & Cone 162 287 CITY OF LA QUINTA TABLE 11 Property Tax Levies and Collections Last Seven Fiscal Years ( in dollars) Collected within the Fiscal Taxes Levied Fiscal Year of Levy Collections in Total Collections to Date Year Ended for the Percent Subsequent Percent June 30 Fiscal Year Amount of Levy Years Amount of Levy 2006 $ 61,420,601 $ 73.097,362 119.01% $ 2,092,062 $ 75,189,424 122.42% 2007 74,170,170 83,797,365 112.98% 1,802,076 85,599,441 115.41% 2008 83,018,429 87,804,912 105.77% 3,216,547 91,021,459 109.64% 2009 83,934,188 86,721,572 103.32% 1,471,940 88,193,512 105.07% 2010 78,621,410 80,651,874 102.58% 434,643 81,086,517 103.14% 2011 72,735,079 74,047,640 101.80% 259,209 74,306,849 102.16% 2012 73,462,430 38,125,919 51.90% - 38,125,919 51.90% NOTE: The amounts presented include City property taxes and Redevelopment Agency tax increment. This schedule also includes amounts collected by the City and Redevelopment Agency that were passed -through to other agencies. Effective February 1, 2012, ABlx26 dissolved the Redevelopment Agencies throughout the State of California which resulted in the reduction of amounts collected during Fiscal Year 2011-12. Note: The information was first presented in Fiscal Year 2006. Source: County of Riverside Auditor Controller's Office 163 288 Governmental Activities Reimbursement Agreement Capital lease USDA Loan Provident Savings Loan Due to Coachella Valley Unified School District Due to County of Riverside Developer Agreement Tax Allocation Bonds Project Area 1 Tax Allocation Bonds Project Area 2 2004 Local Agency Revenue Bonds - 2011 Local Agency Revenue Bonds City Hall Lease Revenue Bonds Unamortized Discount and Issuance Costs Total Governmental Business -type Activities Capital Leases Total Business -type activities Total Primary Government CITY OF LA QUINTA Ratios of Outstanding Debt by Type Last Ten Fiscal Years (in dollars) Fiscal Year Ended Fiscal Year Ended Fiscal Year Ended Fiscal Year Ended 2003 2004 2005 2006 $ 478,311 $ 428,311 $ 378,311 $ 328,311 7,365,254 6,653,377 5,927,263 5,186,627 2,150,000 2,050,000 1,950,000 1,850,000 684,688 1,010,688 898,141 776,030 134, 776, 344 142, 507, 628 140,263,659 141, 785, 000 10,801,820 6,325,000 6,230,000 6,130,000 87,924,343 87,947,058 89,265,000 7,190,000 6,890,000 6,575,000 6,245,000 (877,230) 163,446,417 253,789,347 250,169,432 250,688,738 801,417 1,090,602 801,417 1,090,602 $ 163,446,417 $ 253,789,347 $ 250,970,849 $ 251,779,340 Population - State Department of Finance January 1 30,452 32,522 36,145 38,340 Number of Households 14,938 15,942 17,549 18,762 Median Household Income (2) (2) $ (2) $ 65,906 Percentage of Personal Income (2) (2) -200.00% 20.36% Debt Per Capita $ 5,367 $ 7,804 $ 6,943 $ 6,567 'Notes: Details regarding the City's outstanding debt can be found in the notes to the financial statements. 1 The debt service payment for the 2004 Lease Revenue Bonds are made from Redevelopment Project Area 1 & 2 low & moderate income tax increment. 2 Information not collected prior to Fiscal Year 2006 164 289 TABLE 12 Fiscal Year Ended Fiscal Year Ended Fiscal Year Ended Fiscal Year Ended Fiscal Year Ended Fiscal Year Ended 2007 2008 2009 2010 2011 2012 $ 278,311 $ 228,311 $ 178,311 $ 128,311 $ - $ - - - 149,169 114,583 78,253 40,090 - - 751,754 741,171 729,480 716,468 - - 1,556,283 1,530,958 1,503,433 1,473,515 4,431,178 3,675,731 2,874,653 2,072,965 1,255,243 - 1,750,000 1,600,000 1.400,000 1,200,000 1,000,000 - 643,539 511,048 343.814 174,584 - - 139,145,000 136,350,000 133,390,000 130,255,000 126,925,000 123,385,000 6,025,000 5,915,000 5,800,000 5,680,000 11,555,000 11,425,000 87,745,000 86,175,000 84,560,000 82,890,000 81,150,000 79,345,000 - - - - 28,850,000 28,850,000 5,900,000 5,540,000 5,160,000 4,760,000 4,340,000 3,895,000 (877,230) (941,087) (804,944) (768,801) (1,115,799) (1,075,595) 245,040,798 239,154,003 235,359,040 228,778,771 256,270,610 248,054,478 825,848 681048 285,217 54,543 286,097 169,084 825,848 681,048 285,217 54,543 286,097 169,084 $ 245,866,646 $ 239,835,051 $ 235,644,257 $ . 228,833,314 $ 256,556,707 $ 248,223,562 41,092 42,958 43,778 44,421 37,836 38,075 20,176 21,058 21,355 23,489 23,528 23,528 $ 67,754 $ 74,683 $ 76,227 $ 90,124 $ 104,410 $ 104,045 17.99% 15.25% 14.48% 10.81% 10.44% 10.14% $ 5,983 $ 5,583 $ 5,383 $ 5,151 $ 6,781 $ 6,519 165 •110.. , 290 CITY OF LA QUINTA TABLE 13 Ratio of General Bonded Debt Outstanding Last Ten Fiscal Years (In Dollars) Outstanding General Bonded Debt Fiscal Year City Hall Lease Tax Percent of Per Ended Lease Local Agency Allocation Assessed Median June 30 Obligation Revenue BondsBonds Total Value' Household Income 2003 $ 7,190,000 $ - $145,578,164 $152,768,164 4.05% 2 2004 6,890,000 87,924,343 148,832,628 243,646,971 4.55% 2 2005 6,575,000 87,947,058 146,493,659 241,015,717 3.87% 2 2006 6,245,000 89,265,000 147,915,000 243,425,000 3.12% 3,694 2007 5,900,000 87,745,000 145,170,000 238,815,000 2.39% 3,525 2008 5,540,000 86,175,000 142,265,000 233,980,000 1.97% 3,133 2009 5,160,000 84,560,000 139,190,000 228,910,000 1.84% 3,003 2010 4,760,000 82,890,000 135,935,000 223,585,000 1.90% 2,481 2011 4,340,000 110,000,000 138,480,000 252,820,000 2.33% 2,421 2012 3,895,000 108,195,000 134,810,000 246,900,000 2.39% 2,373 General bonded debt is debt payable with governmental fund resources and general obligation bonds recorded in enterprise funds (of which, the City has none). ' Assessed value has been used because the actual value of taxable property is not readily available in the State of California. 2 Information not collected prior to Fiscal Year 2006 Source: City of La Quinta 166 �_ 291 CITY OF LA QUINTA Direct and Overlapping Debt June 30, 2012 City Assessed Valuation $ 3,969,069,991 Redevelopment Agency Incremental Valuation 6,362,361,967 Total Assessed Valuation $ 10,331,431,958 Source: Riverside County Auditor Controller Percentage Outstanding Applicable' Debt 6/30/12 Overlapping Debt Repaid with Property Taxes And Assessments: Desert Community College District 7.937% $ 320,591,264 Coachella Valley Unified School District 34.800% 109,948,827 Desert Sands Unified School District (DSUSD) 7.565% 243,740,852 DSUSD Community Facilities District No. 1 100.000% 1,525,000 City of La Quinta 1915 Act Bonds 100.000% 740,000 Coachella Valley Water District Assessment District No. 68 86.247% 1,895,000 Total overlapping debt repaid with property taxes 678,440,943 Overlapping Other Debt including Certifications of Participation (COP) Riverside County General Fund Obligations 1.714% $ 655,042,180 Riverside County Pension Obligations 1.714% 357,540,000 Riverside County Board of Education COP 1.714% 5,055,000 Coachella Valley Unified School District COP 34.800% 48,850,000 DSUSD COP 7.565% 57,905,000 Coachella Valley County Water District I.D. No. 71 COP 11.522% 1,410,000 Coachella Valley Recreation and Park District COP 13.207 % 2,280,000 Total overlapping other debt 1,128,082,180 Total overlapping debt 1,806,523,123 City direct debt Total direct and overlapping debt TABLE 14, Estimated Share of Overlapping Debt $ 25,445,329 38,262,192 18,438,995 1,525,000 740,000 1.634.381 86,045,897 $ 11,227,423 6,128,236 86,643 16,999,800 4,380,513 162,460 301.120 Notes ' For debt repaid with property taxes, the percentage of overlapping debt applicable is estimated using taxable assessed property values. Applicable percentages were estimated by determining the portion of another governmental units taxable assessed value that is within the city's boundaries and dividing it by each unil's total taxable assessed value. Overlapping governments are those that coincide, at least in part, with the geographic boundaries of the City. This schedule estimates the portion of the outstanding debt of those overlapping governments that is bome by the residents and businesses of the City. This process recognizes that, when considering the City's ability to issue and repay long-term debt, the entire debt burden bome 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. Source: California Municipal Statistics, Inc.- overlapping debt Source: City of La Quinta - City Direct debt 39,286,195 125,332,092 248,223,562 $ 373,555,654 292 167 CITY OF LA QUINTA Legal Debt Margin Information Last Ten Fiscal Years 2003 2004 2005 2006 2007 Assessed valuation $ 3,767.559,451 $ 5,367,903,512 $ 6,220,471,097 $ 7,813,866,586 $ 9,975,646.644 Debt limit percentage 15% 15% 15% 15% 15% Debt limit 565,133,918 803,685,527 933,070,665 1,172,079,988 1,496,346,997 Total net debt applicable to limit: General obligation bonds - Legal debt margin $ 565,133,918 $ 803,685,527 $ 933,070,665 $ 1,172,079,988 $ 1,496,346,997 Total debt applicable to the limit as a percentage of debt limit 0.0% 0.0% 0.0% 0.0% 0.0% Section 43605 of the Government Code of the State of California limits the amount of indebtedness for public improvements to 15% of the assessed valuation of all real and personal property of the City. The City of La Quinta has no general bonded indebtedness. Source: City of La Quints Finance Department based upon the Assessed valuation received from the County of Riverside Auditor Controllers Office 168 t293 TABLE 15 2008 2009 2010 2011. 2012 $ 11.866,414,134 $ 12,416,034,763 $ 11,753,185.892 $ 10,870,790,733 $ 10,331,431,958 15% 15% 15% 15% 15% 1,779,962,120 1,862,405,214 1,762,977,884 1,630,618,610 1,549,714,794 $ 1,779,962,120 $ 1,862,405.214 $ 1,762,977,884 $ 1,630,618,610 $ 1,549,714,794 0.0% 0.0% 0.0% 0.0% 0.0% 294 169 CITY OF LA OUINTR TRBIF 16 Plydw-Min"Min Loma} 1 4Ten F"Yeas (In OUWe) Tax PlbnLM Bans- Pged Me 1 YW T. Ies Otlnt NNTea OeM 3ervry hVemeN DIN NyMMOMa IWMMMI F1,,oO INaeN Coe20e 2003 S 211C38099 f 12.12+,3M E 8,981,755 E 1.2W.WO f 6,W.172 +23 2O14 23y689Es 14.581,305 9.3851819 1,fi60,W3 7,235,893 1.03 2035 27.093.693 16.+85"m 10.m W`1 2,395,000 7.9096fi9 im 2008 385p6.201 20,638.731 15,867,470 2,WO.00O ].805.9]5 1.$4 207 42.029,503 2860.149 21,209,35a 2,W80.0 7,6M.900 2.06 208 43,476,312 25383,713 18092.599 2,795.O30 7.5O3.553 1.78 20D9 40.519,3W 25Da8358 15473.024 2.9W.WO 7,3W,188 1.50 2010 38,511.789 47,006731 a (8,41.,WB) 3,1350W 1.144.062 (083) ptt 35192A7+ 28.+p,M6 ° BX3.OM 3.3W.OW 8.9$iAm O.BB N12 ° 18505.037 9,980.]]9 8,520,309 3.113,575 6.675,357 887 F EWYes EM6 Taz .0. N.T. Debts- Juro.'9) InpxneM Cro[PaYmeMa InaemeM, P6rclpal IMert9 Cmeax� 2003 E 9,9AW2 S 9,212,788 f ]O4J]4 f won, f 330,248 162 Not 12,126,871 11,076.00B 1,OW,883 90.000 327,O80 2.52 2005 140X. +2,894,BCd MQ.159 95,0311 VlA.4 2.73 m 19,&9,893 173M,ill 2,524,482 100,O00 319,158 502 2007 20,7]],156 lO..825 2223283 +S.O3 3140,)85 5.p AN 23N2TW 20.W9,512 2.15.2M 1000 3135 5,14 2O09 22,TW.n4 2ta2au t]40.9W 115,000 M5+81 4,14 200 20.]831W 19,373.On 1.395+OT 12OXW 299,. 331 p11 19,N9,0.Tfi 1T,5B1,]54 1.757$02 125,OO 213.272 020 ill 2012 9,335,9'A 3.465 W 9W,w Mon 633.043 1 W4 T. AsolM ft.n-165X HgMg PMYn Flsral Yes E. Tax 1e1.0. NNTax OM3arnc Jurop Imeniema DaM P.,.M. IrcsemeM Pnrulcel leure9 CMMMe 2W3 E ].]50.765 E - $ 1760,765 E 23J.ID0 f 251]56 1599 2. 8,023.07 - 9,W3407 245,125 235.]]6 1876 2W5 10,282'. - 10,262,654 264.5W 218.6% 2130 2006 14,on. - b"On'024 279.350 201.n5 29M ,007 151O1.06f - 15.701.884 299,700 180pe9 22,73 p00 16,641.016 - 10.841.016 321.900 157401 U,72 2ON 15,825:11 - 15,825.]]3 %5025 1330% 3310 p10 14.820242 - 14,BM.242 3IDpW 31,07 p11 13,635,3]] - 13,635,3]] 396,825 ]B,WO 20OO X12 ° 6A .705 6.464,105 4n,425 48,922 n,N FIs MM EWOM Tax Less, Cos Ne1Tex Oed Sarce Jure3] ImxmeM° CeM Pavmarva IrcremeN PnrclOal INerenl Lmerax 2W5 E 192B2,YM E - 5 1923268a f - f 2,990,049 364 2" t4,0n'. - 14639,024 7.OW 1,4XAl 2,72 2WT 15]Ot1 - 15.701664 1,520,000 4A02.509 2.65 XN 16:" 0'. - 16,641,018 1,5]O,LUO 4.356803 2.61 p09 15025]]3 - 15,825.223 1,fi15.0[O 4.304.fri 28] p10 =:242 - 14,OM.242 lbool]I 4.243.331 2,51 .11 13.8M.377 - 13.835.3]] 1,740.OW 4.175.131 231 2012 - ° 6A64.706 - 6A64,206 1.805,OW 4,099.719 1.dJ Fb it Yea EMM T. Les:gMr N.T. DMSIM- Jsnp ImemM° on, PeM, IrcfemeM FlIM09 IMretl Caerepe N12 ° S 6I64!06 f - $ li 6 jn f - E 1,94,531 4.11 FWh6 W E Le .. Vn, C'. Non Leaae OW 3ervYa ,yyn 3p Reuxmn OeE1 PeNreNi Rc•enm PMrlpel Inmretl LmTNn pN S 6nA35 f - f 679.435 f n5,003 S 394.435 I'm NN 660'a. - fiW630 no OW 3W,630 10) ton 891,220 - fal.. 315.000 3O'. 1.80 Nin 880,5T5 - OW.STS 3nCOO 3W,S75 1N p0] 678,865 - BTOWS 345.000 333,865 1.03 no 6T5.&U° - BTS. °&6 3fA.6N 315,883 103 pW 2.450 - Min 3B0.0.O 2WASO 100 p10 6i5,280 - 615.280 Anon. 275.280 1.00 p11 6]2,525 - 6T2.525 428W0 252.525 160 p12 873,521 613,621 445,W0 226.521 100 Nnm: OMai M9i"'N IM N'.CN&eWIN MGn b bMW M I. Meg ",Mn NarciN N918meM 'TesImemeN naeNil, re]ire0 bi. Mi. '".. wNcn Mbyu mry M. a[araWW m Tax abv anfi Wls °Leav,inir MWdpe)menbt MMI Me Cl, Lemral F.. CN C. o,,,e,MM Im9 Fee Fun aM Me FtWawbp dAOen, Capml PMeMy FUM a Tm IvemeMmnruesf. Wtn Pry Naa1eM Rdetl Nv 2.B MWerNe I- FUMB116n anrualtleM.seMm P Inns. 4.TM Shce d Catlar&aveaaN 1M le ,I,, fleEevabpmeN A9,W, a bb,,mne&edinM WMagmeNsiM mM PaymeN 0 f23$82.367 b FY Nonni w14cn xas vp ,MMR PMa 1 W evemeN reanac TnLL Ire,MMi wv nWea by a$10 MOM ban MOM M,,ny,FUMmby, Ogercy.$10 mil. tmm 0n OeM servle FW ,MM on, MA"Mi Mro t Le9Jlel PMints FUM, BII, MOM.. M.Win ma My nqy a ra83.. Mrs Leen ll]. °TMSpu of CMlmbasLae6a 0n M WFb Fe MMIMMny 41 ab`XO-W WMby W mWi a JmeNa1M NN pcymeN d f4.B55, 1 W In FY 20101p11 w hxea Pat MOM j MatwW-ent Nnimee °TML ,dR.6MM rem80e 2. pcMRy W Ire OMMit.n May 2012 wnM'e on, in.y h, My W.--Mt bbsMan nniMb yvsn OeOl xrvvsl MMMM wme rod .-W,. Mn t. I. 2012. 170 "� 295 CITY OF IA OUINTA TABLE 17 Demographic and Ecommic Statistics Last Ten Calendar Years Calendar Calendar Calendar Calendar Calendar Calendar Calendar Calendar Calendar Calendar Calendar Year Year Year Year Year Year Year Year Year Year Year Sources: = M ice$ 2006 2007 M �. 2010 2011 2= City Land (Sg Miles) (3) 34.8 34.8 35.1 35.1 35.10 35.10 35.31 35.31 35.31 35.31 35.16 Population (1) 28715 30452 32522 36145 38,340 41,092 42,958 43,778 44,421 37,836 38.075 Median Hcuaehold In. (in dollars) (4) (4) (4) (4) (4) S65,906 $67,754 $74,683 $76,227 $90.124 $104,410 $104,045 Number of Dwelling Units (3) 14,127 14,938 15,942 17.649 18,762 20,176 21,058 21,355 23,489 23,528 23,528 Persons per Household (3) 2.841 2.848 2.848 2.878 2,855 2.846 2.851 2.851 2.865 2.549 2.555 Average Income per person per household (6) (6) (6) (6) (6) $23,084 $23.W7 $26,195 $26,737 $31.457 $40,961 $40,722 Labor Force (2) 12500 13000 13700 14300 14,500 15,300 15,200 14,800 14,600 14,400 15.100 Employment (2) 12100 12500 132M 13%0 14,100 14,90D 14,600 13,7W 13,500 13,300 14,100 Unemployment Rate (2) 3.20% 3.85% 3.65% 2.80% 2.76% 2.61% 3.95% 7.43% 7.53% T64% 6.62% Madlan age (4) (4) (4) (4) (4) 36 36A 36.4 36.4 42.2 41.5 42.8 Sources: (1)State of California Department of Finance- January 1 of each Year (2) Some of California Economic Development Department website (3) City of La Ouinta Building 8 Safety and Community Development Departments (4) Desert Wheelers Newsletter City Overview, through 2009: HeLCoren 8 Cane Companies ftreafler- data not available before 2W6 (5) Tim populat mn number was updated based upon the 2010 Un'4ed States Census (6) The information was not collected before 2W6 171 it.. 296 CITY OF LA QUINTA TABLE 18 Principal Employers Current Year and Nine Years Ago 2011-2012 2002-2003 Percent of Number of Total Number of Employer Activity Rank Employees Employment Employees Rank La Quinta Resort & Club Hotel & Golf Resort 1 1,211 9.11% 1,500 1 Desert Sands Unified School Distict Government 2 968 7.28% 550 3 Wal-Mart Super Center Retailer 3 367 2.76% 250 4 Costco Retailer 4 234 1.76% - - Home Depot Retailer 5 165 1.24% 180 6 Rancho La Quinta Golf Resort 6 152 1.14% 200 5 Lowe's Home Improvement Retailer 7 145 1.09% 150 7 Hideaway Golf Resort 8 122 0.92% 1,100 2 Tradition Golf Club Grocery Store 9 101 0.76% 97 12 City of La Quinta Government 10 89 0.67% 76 13 Imperial Irrigation District Utility Company - - 110 9 Stater Brothers Grocery Store - - 126 8 Vons Grocery Store - - 103 10 Total employment listed Total City Employment - July 1 3,554 26.72% 4,442 13,300 12,100 "Total Employment" as used above represents the total employment of all employers located within City limits with over 100 employees Source: City of La Quinta 1, 297 172 CRY OF LA OOIRTA TABLE 19 Full-0ma City Emw ,awe by Funcnan - Iast Ten Fis®I Ymn Fixel Year Fbcel Year Fi.1 Year RwIO Year Fittel Year Fimal Yen Flaw Year Fiscal Yaer F.-I Your Retail Y. End, Ending gn ilg EMi, Exam Ending Ercin9 End'mg 30 Exam June 30 EMi, June 30 June 30 June 30 June 33 June 39 June 30 June June 7o 2M June 2010 2011 2012 FuncYm 20W 2004 no me 2007 2008 800 800 B.Oo 900 1000 1200 1200 13.00 14.00 1200 ACminiebNion 500 5.0) SCO 500 500 6.00 6W 6.00 am 5.00 Ciy CIeA 7.00 800 800 9m 9.00 900 9.00 900 90O 9CO Finance TM ]00 8C0 1025 1025 11.25 1125 10.35 10.35 10.35 Cunmunny Service Buildn and Safety Moo 190J 21.03 22.00 24L0 25.00 2500 25A3 2400 2103 Planning end Oemidenant 900 900 900 1200 12.00 12.00 12.00 4000 9.00 B00 2100 2200 23.50 M25 2625 2825 2925 2725 26.25 24.25 Public Wake 0.50 ow n.w 060 0.50 0.40 oe0 OA0 7B00 91.W 9i D] 10403 105.00 101.00 99.W 8900 Tutal 7600 �8300 Sours: City a Is Oulntta ROTE: The City o1 Le Quin¢ mtts wan the CaunryA Rewind be Pdlw Service end eiM the CNikmle OnvnnreM be F.matry Mmgh a arllradt with be Cwnry N RivnNde for Flre Services. In additim One Cityamed Golf curse IadFawated by ten woad, con, maws au bona have 173 0 298 CITY OF LA OUINTA Operating Indicators by Function Last Seven Fiscal Years TABLE 20 2006 2007 2008 2009 2010 2011 2012 Finance: Number of Active Business Licenses 3,208 3,424 3,690 3,523 3,428 3,183 3,310 Number of Animal Licenses Processed 892 1,022 1,272 1,609 1,768 1,619 1,674 Number of Accounts Payable Checks Processed 4,696 4,722 4,840 4,819 4,393 4,530 3,766 Number of investment purchases 39 73 64 36 32 20 27 $327,417,000 $392,729,000 $424,500,000 $229,969,000 $267,213,000 $186,480,000 $143,685,000 Par value of investments Number of cleared checks 5,081 4,837 5,501 5,269 4,984 4,912 5,103 Number of outgoing bank wires 202 158 136 91 75 87 63 Public Works: Encroachment permits issued 304 218 110 132 78 104 65 Request for services 618 419 1152 1931 1306 746 534 Building & Safety: Permits: Single family Detached 1,044 526 297 129 56 85 39 Single family Attached 227 38 0 6 12 0 11 Residential Pool 866 612 331 207 152 148 127 Wall/Fence 1,502 963 583 299 178 218 149 Other . 1,607 1,404 1,121 908 790 1,033 916 Total Permits 5246 3543 2332 1549 _ 1188 1,484 1,242 Code Compliance: Animal Control Incidents Handled 1,901 687 2,920 3,630 3,984 4,392 4,246 Vehicle abatements 909 296 351 . 346 214 263 139 Garage Sale Permits 1,190 1,444 1,519 1,535 1,663 1,805 1,430 Weed abatements 141 76 117 97 125 143 106 Nuisance abatements 1,611 2,032 2,142 3,130 2,340 2,252 2.433 Community Services: Library activities: Library Volume 42,050 44,981 66,124 81,124 89,060 92,484 109,000 Library books checked out 55,002 99,659 117,738 215,843 259,711 263,064 275,838 Library Cards Issued 5,550 5,325 3,675 3,684 3,547 3,822 4,477 Number of School Children Visiting Library 745 260 941 1,036 772 1,881 962 Library Volunteer Hours 1,891 1,583 1,951 2,342 2,723 4,280 2,720 Senior Center: Number of visits 14,305 12,955 14,013 15,739 20,326 18,403 16,642 Senior Center Volunteer Hours 3,481 4,192 3,332 2,583 3,131 3,099 2,690 Recreation activities: Participants: Leisure Classes 1,373 1,192 990 1,140 1,437 1,512 2,016 Special events 4,668 7,809 8,109 11,053 8,795 8,933 36,305 Adult Sports 3,402 6,827 8,550 10,806 13,364 13,092 5,647 Golf course: Golf rounds played 38,934 40,548 40,516 39,150 43,779 45,269 46,949 Average $ Green fee 71.12 76.97 81.09 76.13 71.59 70.7 70.4 Planning and Development: Number of residential units approved 1.063 534 338 100 255 208 285 Commercial square footage approved 533,726 124,821 342,502 390,097 6,200 27,526 61,662 Source: City of La Ouinta Note: Information not collected before 2006 174 " 299 CITY OF LA OUINTA TABLE 21 Capital Asset Statistics by Function Last Ten Fiscal Years Fiscal Year Fiscal Year Fiscal Year Fiscal Year Fiscal Year Fiscal Year Fiscal Year Fiscal Year Fiscal Year Fiscal Year Ending Ending Ending Ending Ending Ending Ending Ending Ending Ending June 30 June 30 June 30 June 30 June 30 June 30 June 30 June 30 June 30 June 30 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 Public works: Streets (nines) 118.40 118.40 118.40 118.40 122 127 127 127 122 12 Bikepaths(nies) 22 22 22 22 22 22 22 22 22 222 Streetlights' 73 85 85 261 266 265 269 Traffic signals 2 z z 44 45.25 45.25 49 50 50 51 Traffic signs' 2 z 2 2,799 2,845 2,895 2,899 2,909 2,919 2,934 Bridges 2 : 2 12 12 12 12 12 12 12 Parks and recrea0on: 9 12 12 12 12 13 13 13 13 13 Parks Park Acreage 40 207 207 207 207 209 209 218 218 218 Undeveloped Park Acreage' z ' 2 40 40 40 40 40 40 1 40 1 Senicr Center 1 1 1 1 1 1 1 1 1 Museum 1 1 1 1 1 1 1 1 Library 1 1 1 1 1 Gall Course: 1 1 1 1 1 1 Municipal golf courses - - - 1 Sounx: City of La Quanta ' In Fiscal Year ending 2009 street lights at intersections were inckrded for the first tine. ` In Fiscal Year ending 2006 traffic signals , traffic signs, and undeveloped perk acreage were included for the first tinre. 175 4 300 Company Name Policy Number Hartford 72BPEEW0254 Lexington 20412656 Lloyds 750020221-L-00 California Joint Powers Insurance Authority California Joint Powers Insurance Authority Alliant PEC0011896301 CITY OF LA OUINTA Schedule of Insurance in Force June 30, 2012 Coverage Employee Dishonesty, Forgery, Computer Fraud All Risk Property Insurance Including Auto Physical Damage, Terrorism, Boiler & Machinery (Excluding Earthquake) Earthquake/Flood Real & Personal Property Including Contingent Tax Interruption Comprehensive General Liability Worker's Compensation Pollution Liability 176 TABLE 22 Limits Term Premium $1,000,000 12/3111 - 12/3112 $3,224 64,497,900 7/01112 - 7/01/13 59,620 20,000,000 2/07112- 2107/13 122,811 $50 Million 7/01/12 - 7/01113 279,613 Single Limit per Occurrence 10,000,000 7/01/12-7/01113 108.547 10,000,000 7/01/11 - 7/01/14 26,227 is.. > 301 P I aP' luwr Vew• � LSOOOO OOAO OO CERTIFIED PUBLIC ACCOUNTANTS • Brandon W. Burrows, CPA • David E. Hale, CPA, CFP A Professional Corpo2r/on • Donald G. Slater, CPA • Richard K. Kikuchi, CPA • Susan F. Matz, CPA • Shelly K. Jackley, CPA • Bryan S. Gruber, CPA • Deborah A. Harper, CPA 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, To the Honorable Mayor and Members of the City Council City of La Quinta, California We have audited the financial statements of the governmental activities, the business -type activities, each major fund, and the aggregate remaining fund information of the City of La Quinta, California, (the City) as of and for the year ended June 30, 2012, which collectively comprise the City's basic financial statements and have issued our report thereon dated November 16, 2012. 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. internal Control Over Financial Reporting Management of the City of La Quinta, California, is responsible for establishing and maintaining effective internal control over financial reporting. In planning and performing our audit, we considered the City's internal control over financial reporting as a basis for designing our auditing procedures for the purpose of expressing our opinions on the financial statements, but not for the purpose of expressing an opinion on the effectiveness of the City's internal control over financial reporting. Accordingly, we do not express an opinion on the effectiveness of the City's internal control over financial reporting. A deficiency in internal control exists when the design or operation of a control does not allow management or employees, in the normal course of performing their assigned functions, to prevent or detect misstatements on a timely basis. A material weakness is a deficiency, or combination of deficiencies, in internal control such that there is a reasonable possibility that a material misstatement of the City's financial statements will not be prevented, or detected and corrected on a timely basis. Our consideration of internal control over financial reporting was for the limited purpose described in the first paragraph and was not designed to identify all deficiencies in internal control over financial reporting that might be deficiencies, significant deficiencies or material weaknesses. We did not identify any deficiencies in internal control over financial reporting that we consider to be material weaknesses, as defined above. However, we identified the following deficiency in internal control over financial reporting that we consider to be a significant deficiency in internal control over financial reporting. A significant deficiency is a deficiency, or 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. Grant management and reconciliation During our audit procedures of the federal grants, we noted that grants had not been completely reconciled to the general ledger at the end of the fiscal year resulting in audit adjusting entries to accrue receivables for expenditures incurred and eligible for reimbursement. Additionally, during our audit procedures of the Schedule of Expenditures of Federal Awards, we noted that grants had not been properly reconciled to the end of fiscal year balance and that various grants were not on the schedule. We recommend that grant activities be reconciled shortly after fiscal year end to record any receivables and that a review function be established to detect errors when preparing the Schedule of Federal Expenditures. ' `F . 302 Lance, Soil & Longhand, LLP 203 North Brea Boulevard • Suite 203 • Brea, CA 92821 TEL: 714.672.UU22 • Fax: n4.urz.vsai www.rarcPas.cmn - Orange County • Temecula Valley • Silicon Valley 000 000 LSE 00 CERTWED PUBLIC ACCUURtABTR To the Honorable Mayor and Members of the City Council City of La Quinta, California Compliance and Other Matters As part of obtaining reasonable assurance about whether the City's financial statements are free of material misstatement, we performed tests of its compliance with certain provisions of laws, regulations, contracts, and grant agreements, noncompliance with which could have a direct and material effect on the determination of financial statement amounts. However, providing an opinion on compliance with those provisions was not an objective of our audit, and accordingly, we do not express such an opinion. The results of our tests disclosed no instances of noncompliance or other matters that are required to be reported under Government Auditing Standards. This report is intended solely for the information and use of management, the City Council, federal awarding agencies and pass -through entities, and is not intended to be and should not be used by anyone other than these specified parties. , Brea, California November 16, 2012 4r 303 LSE000 e® CERTIFIED PUBLIC ACCOUNTANTS • Brandon W. Burrows, CPA • David E. Hale, CPA, CFP A Professional Corporation • Donald G. Slater, CPA • Richard K. Kikuchi, CPA • Susan F. Matz, CPA • Shelly K. Jacldey, CPA • Bryan S. Gruber, CPA • Deborah A Harper, CPA November 16, 2012 To the Honorable Mayor and Members of the City Council City of La Quinta, California We have audited the financial statements of the governmental activities, the business -type activities, each major fund, and the aggregate remaining fund information of the City of La Quinta (the City) for the year ended June 30, 2012, and have issued our report thereon dated November 16, 2012. Professional standards require that we provide you with the following information about our responsibilities under generally accepted auditing standards and Government Auditing Standards, as well as certain information related to the planned scope and timing of our audit. We have communicated such information in our letter to you dated April 11, 2012. Professional standards also require that we communicate to you the following information related to our audit. Significant Audit Findings Qualitative Aspects of Accounting Practices Management is responsible for the selection and use of appropriate accounting policies. The significant accounting policies used by the City are described in the notes to the financial statements. No new accounting policies were adopted and the application of existing policies was not changed during the year ended June 30, 2012. We noted no transactions entered into by the City during the year for which there is a lack of authoritative guidance or consensus. All significant transactions have been recognized in the financial statements in the proper period. The financial statement disclosures are neutral, consistent, and clear. Difficulties Encountered in Performing the Audit We encountered no significant difficulties in dealing with management in performing and completing our audit. Corrected and Uncorrected Misstatements Professional standards require us to accumulate all known and likely misstatements identified during the audit, other than those that are trivial, and communicate them to the appropriate level of management. Management has corrected all such misstatements. Professional standards require us to accumulate all known and likely misstatements identified during the audit, other than those that are trivial, and communicate them to the appropriate level of management. These differences are described below. In addition, none of the misstatements detected as a result of audit procedures by management were material, either individually or in the aggregate, to the financial statements taken as a whole. 304 Lana, Soil & Longhand, LLP 203 North Brea Boulevard • Suite 203 • Brea, CA 92821 • TEL: 714.672.0022 • Fax: 714.672.0331 www.larcpac.com .Orange County • Temecula valley • Silicon Valley nn� LSE�;; CERTIFIED PUBLIC ACCOUNTANT% Honorable Mayor and Members of City Council City of La Quinta Page 2 Description (Nature) of Audit Difference Amount '� Ius tr Total Effect of Net Unadjusted Audit Difference - prior year 0 Net Audit Differences �.�i. Disagreements with Management For purposes of this letter, a disagreement with management is a financial accounting, reporting, or auditing matter, whether or not resolved to our satisfaction, that could be significant to the financial statements or the auditor's report. We are pleased to report that no such disagreements arose during the course of our audit. Management Representations We have requested certain representations from management that are included in the management representation letter dated November 16, 2012. Management Consultations with Other Independent Accountants In some cases, management may decide to consult with other accountants about auditing and accounting matters, similar to obtaining a "second opinion" on certain situations. If a consultation involves application of an accounting principle to the governmental unit's financial statements or a determination of the type of auditor's opinion that may be expressed on those statements, our professional standards require the consulting accountant to check with us to determine that the consultant has all the relevant facts. To our knowledge, there were no such consultations with other accountants. Other Audit Findings or Issues We generally discuss a variety of matters, including the application of accounting principles and auditing standards, with management each year prior to retention as the governmental unit's auditors. However, these discussions occurred in the normal course of our professional relationship and our responses were not a condition to our retention. With respect to the supplementary information accompanying the financial statements, we made certain inquiries of management and evaluated the form, content, and methods of preparing the information to determine that the information complies with accounting principles generally accepted in the United States of America and Government Auditing Standards, the method of preparing it has not changed from the prior period, and the information is appropriate and complete in relation to our audit of the financial statements. We compared and reconciled the supplementary information to the underlying accounting records used to prepare the financial statements or to the financial statements themselves. The following new Governmental Accounting Standards Board (GASB) pronouncements were effective for fiscal year 2011-2012 audit: GASB Statement No. 57, OPEB Measurements by Agent Employers and Agent Multiple - Employer Plans .X.. 305 000 Goo LSE 00 CERTIFIED ruu¢ ACCOUNTANTS Honorable Mayor and Members of City Council City of La Quinta Page 3 GASB Statement No. 64, Derivative Instruments: Application of Hedge Accounting Termination Provisions -an amendment of GASB Statement No. 53 — The City was not affected by this pronouncement at this time. The following Governmental Accounting Standards Board (GASB) pronouncements are effective in your next fiscal year 2012-2013 audit and should be reviewed for proper implementation by management: GASB Statement No. 60, Accounting and Financial Reporting for Service Concession Arrangements GASB Statement No. 61, The Financial Reporting Entity: Omnibus -an amendment of GASB Statement 14 and 34 GASB Statement No. 62, Codification of Accounting and Financial Reporting Guidance Contained in Pre -November 30, 1989 FASB and AICPA Pronouncements. GASB Statement No. 63, Financial Reporting of Deferred Outflows of Resources, Deferred Inflows of Resources, and Net Position This information is intended solely for the use of the members of the City Council or individual(s) charged with governance and management of the City, and is not intended to be and should not be used by anyone other than these specified parties. Very truly yours, Brea, California 30b I ` I CIT SA/HA/FA MEETING DATE: December 4, 2012 ITEM TITLE: Extend the Existing Golf Course Management Agreement with Landmark Golf Management, LLC RECOMMENDED ACTION: Approve an extension of the existing Golf Landmark Golf Management, LLC until the Water District canal relocation. EXECUTIVE SUMMARY: AGENDA CATEGORY: BUSINESS SESSION: T CONSENT CALENDAR: STUDY SESSION: PUBLIC HEARING: Course Management Agreement with completion of the Coachella Valley The current management contract will expire June 30, 2013. In 2010, the management contract was extended three years due to the pending Coachella Valley Water District (CVWD) canal relocation. The project was delayed and is now scheduled to begin in the summer of 2013. • The CVWD canal relocation will impact the course design, operations as well as the maintenance and irrigation system. • Based on Landmark's experience of the SilverRock Golf Course, staff recommends retaining the management contract until the completion of the canal. • Upon completion of the canal project and Golf Course restoration, staff will prepare an RFP for the golf course management contract that will begin July 1 of the upcoming fiscal year. FISCAL IMPACT: Funding for the referenced services is contained within the City's annual budget. BACKGROUND/ANALYSIS: On January 14, 2005, the City and Landmark Golf Management, LLC (Landmark) entered into a Golf Course Management Agreement for the SilverRock Resort Golf Course that includes; an eighteen -hole golf course, driving range, clubhouse, and maintenance facility. The five-year Golf Course Management Agreement was scheduled to expire at the end of Fiscal Year 2009/2010. 307 On January 5, 2010, City Council extended the golf course management contract with Landmark for an additional three years to accommodate the CVWD canal relocation project. CVWD's intent was to relocate the canal through SilverRock during the calendar years 2010/2012. The rationale for the Landmark extension was to maintain their services because of their working knowledge of the golf course, its construction, irrigation layout, and experience with daily operations. Landmark's knowledge and experience would be necessary for the City's portion of the project such as relocating the irrigation system before the canal work begins and growing the altered course layout after the canal project was completed. Due to delays beyond the City's control, the canal relocation project was not started during Landmark's contract extension period. At this time, CVWD is planning to begin the canal relocation project in the summer of 2013. Their estimated construction time is 45 working days. The City's portion of the canal relocation project will still require infrastructure and golf course modifications on the back nine holes prior to CVWD's portion of the project. The City will also be responsible for landscape changes and grow -in on the back nine holes after CVWD's portion of the project. Staffs recommendation is to extend Landmark's contract until the completion of the Canal Relocation project. Upon completion of the canal relocation and resuming the operations of the back nine holes, staff will prepare a Request for Proposals (RFP) for the Golf Course Management. If CVWD's estimated project timeline is met, the RFP will be advertised in early 2014 with the contract to begin July 1, 2014. This recommendation also provides for unforeseen delays of the relocation project. In the event of project delays, the advertisement of the RFP will be pushed back an additional year with the awarded contract to begin July, 1 2015. ALTERNATIVES 1. Negotiate a new five year agreement with Landmark for management of the SilverRock Golf Resort; 2. Authorize staff to prepare a Request for Proposals for City Council approval that will provide golf course management services beginning July 1, 2013. Respectfully submitted, �dk" Edie Hylton Community 15Zervices Director ,..IN 308 CITY SA / HA / FA MEETING DATE: December 4, 2012 ITEM TITLE: Authorize the City Manager and City Attorney to Enforce the City's Rights Under the Bonds, Including the Initiation of Litigation Against Arch Insurance Company and PH Ranch, LLC as Necessary to Complete Improvements for Tract Map No. 31348, Estates at Point Happy RECOMMENDED ACTION: AGENDA CATEGORY: BUSINESS SESSION: CONSENT CALENDAR: STUDY SESSION: PUBLIC HEARING: Authorize the City Manager and the City Attorney to enforce the City's rights under the bonds, including: 1) the initiation of litigation against Arch Insurance Company and PH Ranch, LLC as necessary to complete improvements for Tract Map No. 31348, and/or 2) the execution of a settlement agreement if a reasonable settlement is reached, and/or 3) The execution of a tolling agreement to suspend the running of the statute of limitations. EXECUTIVE SUMMARY: • The Estates at Point Happy, Tract Map No. 31348, is located south of Highway 1 1 1 and west of Washington Street as shown in Attachment 1. • The developer has not completed, among other things, drainage improvements that should be installed to protect the development from flooding. • City staff issued a sixty (60) day notice of default to PH Ranch, LLC (Developer). The sixty day notice of default has expired and the City has not received any response from the developer. PH Ranch, LLC has lost the property through foreclosure. 1 309 • City staff has spent significant time and resources communicating with Arch Insurance Company (Bond Company) to obtain completion of the remaining improvements. Unfortunately, an agreement has not yet been reached with the Bond Company, and City staff and the City Attorney feel that the Bond Company is not acting in good faith. Therefore, staff recommends that the City Council authorize the above actions in order to protect the City's rights. FISCAL IMPACT: Legal costs for pursuing the bonds will depend upon how long the litigation spans and what type of litigation tactics the Bond Company employs to avoid its legal obligations under the Bonds. The initial estimate is that the City may incur $20,000 in legal fees. The costs could be higher if the litigation becomes protracted. The fees may be recovered in the litigation by the prevailing party. The amount of the outstanding bonds is: Performance Bond Rough Grading $108,150 Offsite Improvements $648,562 Onsite Grading $117,341 Onsite Drainage, Street, Water, & Sewer $473,871 Onsite Utilities $73,800 Monumentation $23,136 BACKGROUND/ANALYSIS: The City Council has previously granted SIA extensions to February 13, 2009 for the off -site improvements and to February 13, 2010 for the on -site improvements. The City's process for addressing delinquent developer required improvements affords the developer generous opportunity to address their shortcomings. Unfortunately in this case the developer and their surety company have not been cooperative and now, as a last resort, litigation is being considered. Staff has been working with and communicating with the developer since March, 2009 to achieve the required improvements. At times, it appeared that the developer was going to comply, but their compliance never came to fruition. The preliminary Notice of Default from the Public Works Director was sent in August, 2011. The final Notice of Default from the City Attorney was sent in November, 2011. Numerous meetings, emails, and conference calls between the City Attorney's Office, City staff and the surety company's consultants and attorneys have not yet resulted in a reasonable settlement. 310 Attachment 2 is a letter from the City Attorney to the counsels for the Bond Company making demand for performance of the bond obligations and responding to the Bond Company's denial of virtually all of the claims. In a response letter (Attachment 3), the Bond Company has offered to pay the City $100,000 in return for full release and exoneration of the bonds by the City except for Bond No. SU5011913, which is for on -site drainage, street, water, and sewer improvements. The Bond Company has requested Bond No. SU501 1913 be reduced from $473,871 to $50,000 so that it only covers the deferred installation of driveways. As an alternative to filing an action, the parties may want to enter into a "tolling agreement" which stops the progression of the statute of limitations and allows for additional time to resolve the claims. This preserves the parties' rights and allows the parties to avoid litigation. Unfortunately, the current position of the Bond Company suggests that attempts to avoid litigation may be unsuccessful. Nonetheless, the City Council is requested to give the City Manager authorization to execute such a tolling agreement if the City Attorney feels it can avoid the need to file an action. In addition, it may be possible for the Bond Company and the City to reach a reasonable agreement regarding the Bond Company's obligations. The City Council is requested to give the City Manager authorization to execute a settlement agreement with the bond company if a reasonable agreement can be negotiated. ALTERNATIVES: Accept the Bond Company's settlement offer or provide staff with alternative direction. Respectfully submitted, imothy F . one s n, P.E. Public Works Director/City Engineer Attachments: 1 . Vicinity Map 2. Letter from City Attorney dated October 17, 2012 3. Letter from Michael Gandee, Esq. dated November 9, 2012 it 311 ATTACHMENT 1 TM 31348 THE ESTATES AT POINT HAPPY STATE Nwy POINT HAPPY WAY PROJECT LOCATION Fly EISENHOWER DRIVE /" INITY NOT TO SCALE WASy SIMON OR. 47th AVE. MA 312 �UT�� ATTACHMENT 2 M. Katherine Jenson .._... _._. __..+__...._.._.._.. RUTAN & TUCKER, LLP Direct Dial: (714) 641-3413 E-mail kjenson@rutan.com October 17, 2012 VIA ELECTRONIC MAIL Michael R. Gandee, Esq. William Pearce, Counsel Watt, Tieder, Hoffar & Fitzgerald, LLP Arch Insurance Company 2040 Main Street 3 Parkway, Suite 1500 Suite 300 Philadelphia, PA 19102 Irvine, CA 92614 (via e-mail also, wpearce@archinsurance.com) Re: Demand for Performance of Bond Obligations - Tract Map No. 31348, The Estates at Point Happy Dear Mr. Gandee and Mr. Pearce: This letter is a follow-up to conversation earlier today. As a starting point, I would like to remind you that each of your performance bonds issued for Tract Map No. 31348, require performance relating to the following: "[P]ublic improvements required by the Conditions of Approval for the subject map" (Bond, Paragraph 1); and "[T]he covenants, conditions and provisions in said [Subdivision Improvement Agreement ("SIA")] and any alteration thereof made as therein provided..." (Bond, Paragraph 5.) Further, the Bond states that no changes or additions to the work to be performed shall, in any manner, affect the bond companies' obligations. The SIAs incorporate by reference all conditions of approval. (SIA, Section 16.) The SIA for the on -site improvements makes it clear that the subdivider must complete all necessary drainage improvements. In Section 2 of the SIA, the subdivider agreed to submit all drainage improvements "required to be constructed or agreed to be constructed under this Agreement as listed in Exhibit `A'." This includes the "SD Channel Flapgate" ("Flapgate") identified as item No. 14 on the On -Site Punch List and marked as a "N" or "No" by Mr. Gordon. The Flapgate is a critical component to the overall drainage program. "Drainage" improvements were clearly part of the anticipated improvements covered by the Bonds. Specifically, drainage is called out as a line item on Exhibit A to the SIA, and $391,210 is identified as the estimated costs. The fact that the Flapgate is not specifically called out as a separate measure is of no import. The SIA has broad categories of improvements. Moreover, when the SIA was prepared, the drainage improvement plans for the tract were not yet completed. For that reason, the "no plans contingency" of 10% was added to the Bond amount. Rutan & Tucker, LLP j 611 Anton Blvd, Suite 1400, Costa Mesa, CA 92626 PO Box 1950, Costa Mesa: CA 92628-1950 1 714-641-5100 1 Fax 714-546-9035 , M Q 119/015610-0035 Orange County I Palo Alto I www.rutan.com J 1 4500207.1.10117/12 RUTAN Michael R. Gandee, Esq. William Pearce, Counsel October 17, 2012 Page 2 When the Storm Drain Improvement Plans were complete in June of 2005, the retention basins were specifically sized such that a portion of the storm water would drain into the Washington Street storm drain, but only with the caveat that a Flapgate would be installed at the outlet. The Drainage Conditions of Approval clearly require that this work be completed to meet the City's drainage standards. (See Conditions of Approval 40 and 42.) As a general rule, all of the storm water from the 100-year storm must be retained on site unless special provisions are made for drainage into channels. Here, if the bond company no longer wishes to utilize the storm drain, it would be necessary to increase the capacity of the retention basins to retain 100% of the storm water in a 100-year storm event. This would require revisions of the drainage plans and a new hydrology analysis. This would certainly be more costly than simply completing the drainage system as approved. Moreover, any argument that the Flapgate should not be covered by the Bond because it was not listed in the more detailed Engineer's Estimate must fail. That Estimate is simply a calculation used to establish the amount of the Bond. It was not part of the SIA, and cannot be relied upon as augmenting the SIA. (See Section 18.1C. of the SIA.) You have also taken issue with On -Site Punch List item No. 6, Retaining Walls. The retaining walls are part of the Rough Grading, and are covered by the Off -Site Improvement Bond. Indeed, the Off -Site Improvement Bond was even altered by the bond company to add the title "Retaining Wall." The retaining wall was one of the recommendations of the Soils Engineer. It was specifically identified as a requirement on the Rough Grading plans. See Note 3, page 1 of 4, and also see Soils Engineer Certificate. Compliance with the Soils Engineers recommendations was an express Condition of Approval in the Conditions of Approval. (See Condition of Approval 32.) These Conditions of Approval are made part of the SIA. (See SIA, Section 16.) The same is true of the Rockfall Wall. That Rockfall wall was included in the Rough Grading Plan per Note 6. It also was a recommendation of the Soils Engineer, and therefore was covered by Condition of Approval 32. These Bonds all reference guaranteeing compliance with the Conditions of Approval. In our view, the Rockfall Wall is covered by the Bonds for the Off - Site Improvements, the Bonds for the On -Site Improvements, and/or the Bonds for the Grading. The fact that the SIAs do not list "Rockfall Wall" is not controlling. The SIAs clearly require compliance with the Conditions of Approval. Moreover, the Rough Grading Plans were completed prior to the issuance of the Grading Bonds, so presumably Arch Insurance was aware of what was being secured by its Bonds. Finally, the Landscaping in the retention basin on Lot H is expressly covered by the Off -Site Improvement Bonds. The item is specifically listed on Exhibit A to the Off -Site SIA. This is an express Condition of Approval for the tract (Condition No. 62.) It is in an area behind the residents' walls, and for that reason, is considered part of the Off -Site Improvements. 119/015610-0035 4500207.1 al0/17112 314 RUTAN Michael R. Gandee, Esq. William Pearce, Counsel October 17, 2012 Page 3 We request that you take a closer look at the language of the subject Bonds, the subject SIAs, and the Conditions of Approval, and that you be prepared on October 26, 2012, to set forth a schedule of construction to meet your obligations under the Bonds, up to the penal sum of the Bonds. We look forward to wrapping this matter up in short order. If we cannot, we will be forced to place this matter on an upcoming Council Agenda to request authorization to file suit on the Bonds. Very truly yours, RUTAN & TUCKER, LLP M. Katherine Jenson City Attorney, City of a Quinta MKJ:lr cc: Timothy R.Jonasson, Public Works Director/City Engineer Ed Wimmer, Principal Engineer ii9mis6m-oo3s 4500207.1 a10/17/12 OR ATTACHMENT 3 WATT, MEDER, HOFFAR & RTZGERALD, L.LP ATTORNEYS AT LAW November 9, 2012 Via Email & First Class Mail M. Katherine Jenson City Attorney, City of La Quinta Rutan & Tucker, LLP 611 Anton Blvd., Suite 1400 Costa Mesa, CA 92626 Re: City of La Quinta's Demand on Performance Bonds; Tract Mao No 31348 The Estates at Point Happy Dear Ms. Jenson: 2040 Main Street Suite 300 Irvine, California 92614 Telephone: 949-852-6700 Facsimile: 949-261-0771 www.wthf.com Michael R. Gandee mgandetaCM .com This letter is in response to your October 17, 2012 letter and is protected under California Evidence Code Section 1152 as an offer to compromise. Set forth below is Arch Insurance Company's ("Arch") response to the 37 items (30 on the on -site punch list and 7 on the off -site punch list) the City of La Quinta ("City") contends are covered by the performance bonds (collectively the "Bonds") that Arch issued to PH Ranch, LLC ("PH Ranch") for the project known as Tract Map No. 31348 — The Estates at Point Happy ("Project"). BOND COVERAGE The Subdivision Improvement Agreement ("SIA") for both the on -site improvements and the off -site improvements provides that PH Ranch "shall construct the public and private street, drainage, utility, landscaping, and other improvements required to be constructed or agreed to be constructed under this Agreement as listed in Exhibit `A"' hereto. Provision 29 of the City's Conditions of Approval provides that PH Ranch is to "submit detailed construction cost estimates for all proposed on -site and off -site improvements." (Emphasis added.) The engineer's Cost Estimate for Subdivision Improvement Bond Purposes ("Engineer's Estimate") submitted to the City provides a detailed estimate of all the improvements to be constructed by PH Ranch and it ties in, dollar -for -dollar, to the penal sum amounts of the Bonds. In other words, the Engineer's Estimate sets forth, in detail, the actual improvements required to be constructed by the SIAS, and correspondingly, covered by the Bonds. McLean, VA San Francisco, CA Les Vegas, NV Seattle, WA Mlaml, FL 316 M. Katherine Jenson City Attorney, City of La Quinta November 9, 2012 Page 2 ANALYSIS OF SPECIFIC PUNCH LIST ITEMS Your letter sets forth the City's position regarding the components of the storm drainage system (on -site punch list item nos. 14, 15 and 16), the rock fall protection barrier (on -site punch list item no. 9) ("RFPB), the landscape improvements (on -site punch list item no. 12), and the retaining walls (on -site punch list item no. 6). Arch's position with respect to these items as well as the other items on the punch lists is as follows. On -Site Punch List Item No. 15 — Construct Manhole on Bradshaw Trail This manhole is located on Bradshaw Trail, a completed street between retention basin no. 2 and lot no. 50. The manhole lid is covered with asphalt, thus making removal difficult for maintenance. This minor issue does not affect the storm drain system's immediate performance. Nevertheless, Arch agrees that removal of the asphalt from the manhole lid is within the scope of the Bonds. On -Site Punch List Item No. 16 — Secure Grate Assemblies at CMP Risers The grates have been installed but are unsecured. This minor issue does not affect the storm drain system's immediate performance. Nevertheless, Arch agrees that securing the grates is within the scope of the Bonds. On -Site Punch List Item No 14 — Install Flapgate at Whitewater Channel This item is not within the scope of the Bonds. It is not identified in the Engineer's Estimate. It is only mentioned on the plans as an item that is "to be installed by separate plan approved by CV WD." In other words, it is work that is contemplated to be performed as part of a separate project and separate set of plans, which were not part of PH Ranch's scope. The flapgate is not part of any of the on -site improvements or off -site improvements and is actually located approximately 400 yards north of the site. In fact, the flapgate is to be installed on the end of an existing 60 inch storm drain line that is already being used by other City projects. On -Site Punch List Item No. 9 — Rock Fall Protection Barriers The RFPB is not identified in the Engineer's Estimate. Hence, it is not covered by the Bonds. Your letter references note 6 of the grading plan as a basis for the City's assertion that the RFPB is covered by the Bonds. This assertion is misplaced for a couple of reasons. First, the note you reference provides "construct high-energy Rock -Fall Protection Barrier by Geobrugg or equal by Separate Permit " (Emphasis added.) In other words, construction of this item is to performed as part of another project involving a separate permit. Moreover, it is clear that such a system was never contemplated by the parties to be covered by the applicable grading bond as a 311 M. Katherine Jenson City Attorney, City of La Quinta November 9, 2012 Page 3 Geobrugg system has a value three to four times that of the original penal sum of the -bond, without even taking into consideration the costs of the specific items identified in the Engineer's Estimate for grading. The City's reliance on provision 32 of the Conditions of Approval and preliminary geotechnical report ("Soils Report") noted therein as a basis for the RFPB being within the scope of the Bonds is equally misplaced. The Soils Report does not require the installation of the Geobrugg system the City identifies in the on -site punch list. Additionally, provision 32 is part of the "Grading" section of the Conditions of Approval. It, like the grading plan the City's relies upon, concern on -site grading. Once again, the Engineer's Estimate addressing grading items does not include a RFPB. However, even for sake of argument if it did, which Arch disputes, the only potential bond it would fall under is the grading bond. The penal sum amount of this bond has been reduced to $117,341 by the City and will be further reduced by on -site punch list item no. 29, which Arch agrees is covered by the grading bond. On Site Punch List Item No 12 — Install Landscape Improvements within Common Area Lots G, Hand K Your letter only references lot H, however, the punch list also includes lots G and K (retention basins nos. 1 and 2). Based on the fact that both retention basins are on -site (verses off -site) and the Engineer's Estimate for on -site work includes no landscaping, Arch concludes the City is withdrawing its demand that Arch landscape these two retention basins. Regarding lot H, Arch does not agree that this area falls under the off -site bond obligation. Per the Engineer's Estimate, 3,600 square feet of off -site landscaping is included as part of the off -site bond (bond no. SU5011916). PH Ranch installed 3,600 square feet of landscaping to the City's satisfaction at the Washington/Point Happy Way entrance and along the Project's boundary with Washington Street. On -Site Punch List Item No 13 — Contact Planning Manager for Landscaping Improvements This item is tied to item 12 discussed above. Accordingly, this item is not with the scope of the Bonds. On -Site Punch List Item No. 6 — Retaining Walls As noted above, the SIA provides that PH Ranch "shall construct the public and private street, drainage, utility, landscaping, and other improvements required to be constructed or agreed to be constructed under this Agreement as listed in Exhibit `A"' hereto. Exhibit "A" to the off -site SIA includes $147,000 for the construction of retaining walls. The Engineer's Estimate for the off -site perimeter improvements, which matches, dollar -for -dollar, with bond no. SU5011916, also includes $147,000 for the construction of 2,450 linear feet of retaining 318 M. Katherine Jenson City Attorney, City of La Quinta November 9, 2012 Page 4 walls on the Project. PH Ranch constructed these walls. Hence, the construction of any additional retaining walls is not covered by the Bonds. On -Site Punch List Item No. 4 — Construct 5' Wide x 6" Thick Concrete Swale This item is not included in the Engineer's Estimate, which maps into the grading bond. On -Site Punch List Item No. 20 — Install Driveways at Vacant Lots This is work is covered within the Bonds but it should be deferred. If the work is performed in the near future, then it will create a source of run-off water and sediment into the storm drain system that will likely trigger SWPPP mitigation measures and future maintenance for the City and follow on developer. Remaining Items on City's Punch Lists Other than the items discussed above and item no. 30, which is a maintenance issue that is beyond the scope of the Bonds, Arch agrees that the other items identified on the punch lists are covered by the Bonds. SETTLEMENT OFFER In light of the above, Arch will pay the City $100,000 to remedy the items that are covered by the Bonds in return for a full release and exoneration of the Bonds by the City except for bond no. SU5011913, which will have its penal sum reduced to $50,000 to cover all potential costs associated with the deferred installation of the driveways identified as punch list item 20. Arch believes this offer is fair and reasonable and should be more than sufficient to complete the items discussed above that are within the scope of the Bonds. If you have any question regarding the above, please feel free to give me a call. Very truly yours, Watt, Tiieeder, Hoffar & Fitzgerald, L.L.P. �v c Michael R. Gandee cc: Will Pearce, Esq. (Via Email only) IRVINE 181027.2 102973.00005 319 FA MEETING DATE: December 4, 2012 AGENDA CATEGORY: BUSINESS SESSION: ITEM TITLE: Public, Educational, and Government Cable CONSENT CALENDAR: Franchise Fee of 1% STUDY SESSION: PUBLIC HEARING: EXECUTIVE SUMMARY: If the City Council desires to start video recording or televising City Council meetings, then City Staff should be directed to request that Time Warner Cable and Verizon California levy a 1% Public, Educational, and Government (PEG) starting January 2013 and begin retrofitting the Council Chambers. The Public, Educational, and Government (PEG) Cable Franchise Fee provides funds to pay only for system/building improvements and equipment to video record City Council meetings. This funding cannot be used for expenses incurred to record and produce said videos. Staff estimates that a PEG fee would generate approximately $165,000 annually ($16,500,000 gross cable revenues x 1% PEG Fee). An initial appraisal of the Council Chambers indicates that it would cost up to $200,000 to upgrade the lighting, sound systems, and equipment. These costs could be initially funded with General Fund Reserves which would then be repaid from the PEG fees. PEG fees may be collected until the system/building improvements and video equipment costs are funded; the PEG fee can be started and stopped at any time. There is approximately a thirty (30) day delay in getting the cable service providers systems set-up to receive the PEG fees. If the City Council elects to start video recording City Council meetings, staff will then further identify the costs and benefits associated with the various options for recording council meetings. These include broadcasting live meetings to recording and archiving the recordings for later viewing. 320 FISCAL IMPACT: Collection of a PEG fee would generate approximately $165,000 ($16,500,000 gross cable revenues x 1% PEG Fee) annually in additional revenue. Staff estimates that it will cost up to $200,000 to improve the Council Chambers, and from $10,000 to $23,400 in annual operating costs. BACKGROUND/ANALYSIS: AB 2987, the "Digital Infrastructure and Video Competition Act", authorized the California Public Utilities Commission (PUC) to issue statewide franchises to communications companies wishing to provide video services. On May 15, 2007, the City Council approved an ordinance implementing AB 2987 — State Video Franchise Fees, Customer Service, and Other Video -Related Matters. Adoption of this ordinance allowed the collection of Franchise Fees (5% of the video provider's gross revenues generated within the City of La Quinta) and "PEG" fees (1% of the video provider's gross revenues generated within the City of La Quinta) from State video franchises with Time Warner Cable (TWC) and Verizon California (Verizon). Franchise Fees may be utilized for general fund purposes, and PEG fees can be used for capital improvement costs and equipment needed for webcasting City Council meetings, educational programs, public safety programs, local interest programs, civic events, etc., consistent with federal and state law, and are treated as a segregated fund with use restrictions. The City currently does not collect PEG fees. On January 4, 2011, the City Council last considered this item and elected to not institute a fee due to limited interest in video recording City Council meetings. This PEG fee would be passed on to the customer and would be listed on their monthly invoice as a separate line item. If a customer of TWC or Verizon receives a monthly bill of $80 to $100 then they can expect to pay an additional $.80 cents to $1.00. Satellite video customers, would not be assessed this PEG fee. City staff contacted the City of Palm Desert to obtain the costs involved to retrofit the Palm Desert council chambers to allow the recording of city council meetings. The Palm Desert council chambers are similar in age and therefore it was prudent to use their costs as an approximate expenditure should the City of La Quinta desire to retrofit its council chambers. The City of Palm Desert incurred costs for upgrading the electrical and audio system, the purchase of cameras, and other equipment. In addition to these costs, the City of La Quinta would have to improve the lighting to the council chambers and purchase additional computer storage and increased internet bandwidth. There are two ways to present the video recording for public viewing: web -streaming and video archiving. Web streaming means a live broadcast feed of City Council meetings using standard definition cameras over the internet or cable television. Video archiving means that City Council meetings are recorded and stored for later viewing. 321 What Other Coachella Valley Cities Are Doing City staff contacted other Coachella Valley cities to determine the methods used for broadcasting city council meetings. The summary below shows the type of broadcasting they are using: Name Type of Video Production Cathedral City Web streaming using standard definition cameras Coachella Video archived Desert Hot Springs Web streaming using standard definition cameras Indian Wells Web streaming using standard definition cameras Indio Video archived Palm Desert Web streaming using standard definition cameras Palm Springs Web streaming using standard definition cameras Rancho Mirage Video archived 322 REPORTS & INFORMATIONAL ITEMS: 1-7 COMMUNITY SERVICES COMMISSION MINUTES September 10, 2012 CALL TO ORDER A regular meeting of the Community Services Commission was called to order at 5:30 p.m. by Commissioner Fitzpatrick. Commissioner Lawrence led the Pledge of Allegiance. PRESENT: Commissioners Blakefey, Fitzpatrick, Lawrence, and Leidner ABSENT: Commissioner Engel STAFF PRESENT: Edie Hylton, Community Services Director; Steve Howlett, Golf & Parks Manager; Tustin Larson, Recreation Supervisor; and Angela Guereque, Senior Secretary PUBLIC COMMENT — None. CONFIRMATION OF AGENDA Motion - It was moved by Commissioners Leidner/Blakefey to confirm the agenda as submitted. Motion carried unanimously. PRESENTATIONS — None. APPROVAL OF MINUTES 1. Approval of July 9, 2012 Minutes Motion — It was moved by Commissioners Leidner/Lawrence to approve the minutes as submitted. Motion carried unanimously. CONSENT CALENDAR - None. BUSINESS SESSION 1. Consideration of Commission Meeting Dates. Director Hylton presented the staff report. 323 Page 1 of 3 Motion -It was moved by Commissioners Blakeley/Lawrence to approve the Community Services Commission meeting dates as submitted. Motion carried unanimously. 2. Consideration of the 2012/2013 Community Services Marketing Plan. Supervisor Larson presented the staff report. Commissioner Blakeley suggested that staff coordinate with the City of Indio on the scheduling of 4`h of July events. Motion -It was moved by Commissioners Blakeley/Leidner to approve the 2012/2013 Community Services Marketing Plan. Motion carried unanimously. STUDY SESSION 1. Discussion of Potential Park and Recreation Collaboration between the City and Desert Recreation District Director Hylton presented the staff report. Commissioner Lawrence asked if there is a downside to this collaboration. Director Hylton will carefully craft what staff duties will be, how logistics are done, and look at doing a one year trial. Commissioner Blakeley asked what portion of funding will DRD contribute. Director Hylton stated that the funding portion needs to be negotiated. Kevin Kalman, General Manager, stated the DRD budgeted approximately $75,000 for the Coordinator position. Chairperson Fitzpatrick asked what will happen to the Indian Wells portion of the Coordinator position. Mr. Kalman stated the needs for Indian wells are very small and could be rolled into the Palm Desert coordinator position. Chairperson Fitzpatrick asked if the City would take over maintenance at Frances Hack Lane Park as well. Director Hylton stated that DRD has hired a Parks Manager to handle the maintenance issues. Commissioner Blakeley suggested staff report back to the Commission on an annual basis as to the collaboration. Commissioners stated their support for the collaboration. DEPARTMENT REPORTS 324 Page 2 of 3 1. July 2012 Department Report Manager Howlett stated October is over -seeding month. Director Hylton stated that the Civic Center Campus, La Quinta Park Rental Space, and Fritz Burns Park will be the only areas over -seeded. COMMISSIONER ITEMS 1. Report from Commissioners Regarding Meetings Attended. 2. Calendar of Monthly Events PUBLIC HEARING - None. OPEN DISCUSSION - None. ADJOURNMENT It was moved by Commissioners Leidner/Blakeley to adjourn the Community Services Commission meeting at 6:16 p.m. Motion carried unanimously. NEXT MEETING INFORMATION: A Regular Meeting of the Community Services Commission to be held on October 8, 2012 commencing at 5:30 p.m. in the City of La Quinta Study Session Room, 78-495 Calle Tampico, La Quinta, CA 92253. Submitted by: WITITTOOMEM1 , Angela Guereque Community Services Senior Secretary M 325 Page 3 of 3 Department Report: iA i w OF TO: The Honorable Mayor and Members of the City Council FROM: Frank J. Spevacek, City Manag� DATE: December 4, 2012 SUBJECT: Project Status Report - November 2012 Activities for Service Delivery Options - Phase 1 The Executive Team was scheduled to present a Services Delivery Options proposal at the December 4, 2012 City Council meeting. However, the City Council requested that this presentation be delayed until the January 2, 2013 City Council meeting (the regular meeting was scheduled for January 1, a holiday). The City Council Members desired time to further consider the staffing proposal and severance package options. In the interim, the Executive Team will be undertaking the following: • Consulting with the La Quinta City Employees Associations and individual City staff. • Assessing the technology needed to support and improve City operations, and evaluating the current capacity to accommodate these needs. • Updating operating revenue and expenditure projections, and comparing these projections to those that support the Fiscal Year 2012/2013 operating budget. • Evaluating the City Hall space utilization to identify physical constraints to accommodating new City operations configurations. • Finalizing the report and support documentation for the January 2, 2013 City Council presentation. '� 326 The report and presentation will be available for public review by December 28, 2012. Concurrent with publishing the report, the Department Directors and the City Manager will meet with City staff to review the proposal. 327 Department Report: 1B a, y OF ram' TO: The Honorable Mayor and Members of the City Council FROM: Frank J. Spevacek, City Manage8 DATE: December 4, 2012 VV��''' SUBJECT: Department Report - Response to Public Comment The following public comments were made at the November 20, 2012 City Council meeting: 1. James J. Stenson, 78875 Avenue 48, Hadley Villas, La Quinta, thanked Council Members for their support in attending ceremonies and invited Council to the upcoming December 7, 2012 flag ceremony at 8:45 a.m. �,:�. 328