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2007-2008 ACFR (July 1 - June 30 Annual Comprehensive Financial Report)CITY OF LA QUINTA, CALIFORNIA COMPREHENSIVE ANNUAL FINANCIAL REPORT YEAR ENDED JUNE 30, 2008 Prepared By FINANCE DEPARTMENT JOHN M. FALCONER Director of Finance THIS PAGE INTENTIONALLY LEFT BLANK CITY OF LA QUINTA COMPREHENSIVE ANNUAL FINANCIAL REPORT JUNE 30, 2008 TABLE OF CONTENTS Page Number INTRODUCTORY SECTION Letter of Transmittal ................... Listof Principal Officials .... .................... ............... ......... ............. .................................. ................ viii OrganizationalChart ................................................................... ix Certificate of Achievement for Excellence in Financial Reporting(GFOA)...................................._....x FINANCIAL SECTION IndependentAuditors' 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.- tatements:Balance BalanceSheet — Governmental Funds ............ ........................................... ............................... .._.20 Reconciliation of the Balance Sheet of Governmental Funds tothe 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 ........ ..... _...... 27 Budgetary Comparison Statement by Department — General Fund.................................:............28 Budgetary Comparison Statement — Low/Moderate Income Housing PA No. 2 ...........................30 Statement of Net Assets — Proprietary Funds...........................................................................31 Statement of Revenues, Expenses and Changes in Fund Net Assets — ProprietaryFunds.........................................................................................................................32 Statement of Cash Flows — Proprietary Funds.............................................................................33 Statement of Fiduciary Net Assets - Fiduciary Funds..................................................................35 CITY OF LA QUINTA COMPREHENSIVE ANNUAL FINANCIAL REPORT JUNE 30, 2008 TABLE OF CONTENTS (Continued) Page Number Notes to Financial Statements....................................:..................................................................37 COMBINING AND INDIVIDUAL FUND STATEMENTS AND SCHEDULES Combining Balance Sheet - Non -Major Governmental Funds..................................................72 Combining Statement of Revenues, Expenditures and Changes in Fund Balance - Non -Major Governmental Funds...........................:......................................80 Budgetary Comparison Schedules — Special Revenue Funds StateGas Tax ..................... ................................................ .............88 Library................................ ................ ......................_.---._. FederalAssistance.......................................................................................................... . .90 SLEBG..................................................... .......... ....-...... ........ ................. ................ ._.-_... .-.... .--91 IndianGaming ............................................... ...........92 Lightingand Landscape.........................................................................................................93 RCTC......................................:......_................:..........,.._...................................,_........-........... 94 Quimby................................ .................................. .................... ................. ....... .....-............... 95 PublicSafety...........................................................................................................................96 ArtsIn Public Places...............................................................................................................97 SouthCoast Air Quality ... .... ....................... ............................. ................................................ 98 AB939.....................................................................................................................................99 14 Low/Moderate Income Housing PA No. 1 .......................... ......-......,......_.......... ........... ..-..... 100 CV Violent Crime Task Force .................................. -..-------- -................................. ................ 101 Justice Assistance Grant................................................................. ....... ............ --..... --.. ...102 Proposition1B Fund.............................................................................................................103 Budgetary Comparison Schedules — Capital Projects Funds CapitalImprovement ....... ..................... _............ .............................. ...............................104 Redevelopment Agency PA No. 1 — Capital Projects ...........................................................105 2004 Low/Mod Bond..........................................................................................._..............---106 Infrastructure.........................................................................................................................107 Transportation, ................................................................. __ .......................... ................. -1108 Parksand Recreation................................................................... 109 CivicCenter..........................................................................................................................110 CommunityCenter .......................... ..................................... _,................. ,...... ,...... ..---..........111 StreetFacility ............... .................. ............................................................................112 ParkFacility............................................................. ...113 FireFacility ................................................ ._A 14 Redevelopment Agency PA No. 2 — Capital Projects ...........................................................115 Budgetary Comparison Schedules — Debt Service Funds Redevelopment Agency PA No. 1 — Debt Service ..................... ............................... ____ 116 Redevelopment Agency PA No. 2 — Debt Service ............................ ............... ........ ....... .... .117 Financing Authority — Debt Service......................................................................................118 Combining Statement of Net Assets — Internal Service Funds ............._............................... -120 CITY OF LA QUINTA COMPREHENSIVE ANNUAL FINANCIAL REPORT JUNE 30, 2008 TABLE OF CONTENTS (Continued) Page Number Combining Statement of Revenues, Expenses and Changes in Fund Net Assets — Internal Service Funds.........................................................................121 Combining Statement of Cash Flows — Internal Service Funds... ............................... .........122 Combining Balance Sheet — All Agency Funds.......................................................................124 Combining Statement of Changes in Assets and Liabilities —All Agency Funds ................ 125 STATISTICAL SECTION NetAssets by Component .................................................. ....... ........................... ........... --......... .128 Changesin Net Assets................................................................................................:..............129 Changes in Net Assets — Governmental Activities ............... ................ ,......... :..................... ........ 130 Changes in Net Assets — Business -type Activities ............. ................. .............. .._..._................... 131 Fund Balances of Governmental Funds ................................. ....... ............. ....... ........................... 132 Changes in Fund Balances of Governmental Funds .............. ............ ._..__._.,..,......... ......... .,......... 133 Assessed Value and Estimated Actual Value of Taxable Property .......... ......._..._._ .....................134 Assessed Value and Estimated Actual Value of Taxable Property - 135 RedevelopmentAgency...................................................................... ................ ....:................... 135 Direct and Overlapping Property Tax Rates ...................................... .................... ....... ....__........ 136 Principal Property Taxpayers.....................................................................................................137 Property Tax Levies and Collections..................................................................._,..............._......138 Ratios of Outstanding Debt by Type... .............................................................. _ .................... __1 39 Ratio of General Bonded Debt Outstanding.................................................................................140 Directand Overlapping Debt.................................................................................._.....,...............141 Legal Debt Margin Information-, ....... ....... ................ _ .................. .............................. ........... 142 Pledged -Revenue Coverage ......................................... _.................................... .......................... 143 Demographic and Economic Statistics ......................... .................. ............... ,............................... 144 PrincipalEmployers..................................................................._...............,..........,.:....,_.............,.145 Full-time City Employees ........................................... ............ ....................... ............................... 146 OperatingIndicators ............................................... ..................... ,..,,................................ ___ ..... 147 CapitalAsset Statistics .......................................... .............................................................. ....... ..148 Schedule of Insurance in Force ............................... _............................................. ...................... 149 THIS PAGE INTENTIONALLY LEFT BLANK •r — --- affil, N P.O. Box 1504 LA QUINTA, CALIFORNIA 92247-1504 78-495 CALLE TAMYICO (760) 777-7000 LA QUINTA, CALIFORNIA 92253 FAX (760) 777-7101 November 18, 2008 To the Honorable Mayor, Members of the Governing Council, and Citizens of the City of La Quinta, California Government Code 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. Further, Government Code 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 for the fiscal year ended June 30, 2008. 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, the objective is to provide reasonable, rather than absolute, assurance that the financial statements are free of any material misstatements. Lance Soll & Lunghard LLP Certified Public Accountants have issued an unqualified opinion on the City of La Quinta financial statements for the year ended June 30, 2008. The independent auditor's report is located at the front of the financial section of this report. Management's discussion and analysis (MD&A) immediately follows the independent auditor's report and provides a narrative 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. 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 Palm Springs Desert Resort Communities Convention and Visitors Authority, 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. The City of La Quinta also is financially accountable for a legally separate Redevelopment Agency and Financing Authority. Additional information on these two 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 need approval from the City Council and the City Manager. Local economy According to the State of California Economic Development Department (EDD), as of July 2008, the total workforce for the City of La Quinta was 15,300 of which 14,600 were employed for a 4.3% unemployment rate. This rate is significantly lower than the Riverside County unemployment rate of 8.4% and the statewide unemployment rate of 7.0%. During the last ten years, the City of La Quinta has been in a growth phase with net assessed values increasing from $2.69 billion in FY 98/99 to $12.52 billion (over 465%). This major increase in assessed value consists primarily of residential development; however, in the last three years major commercial development has occurred along the Highway 1 1 1 corridor. New commercial development includes the recent opening of the following retailers in alphabetical order: Applebee's Restaurant, BevMo, Cost Plus World Market, Homewood Suites, and Mimi's Cafe. These compliment the Costco, Embassy Suites Hotel, Home Depot, Lowes, Sam's Club, Wal-Mart, and Target that have previously located in the City. In addition, the City is anticipating the opening of two Fresh and Easy Grocery Stores, an In and Out Burger, and a LA Fitness Center. The City of La Quinta is also home to many fine restaurants, which include the Hogs Breath Inn, Arnold Palmer Restaurant, LG's and The Falls Prime Steak houses, and the Cliff House. 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 hospitality industry — the La Quinta Resort and Club, PGA West, Home Depot, Wal-Mart, Rancho La Quinta, and Lowe's. During the past ten years, the City of La Quinta general fund expenditures have increased 334%. Two Departments that have exceeded the average include Community Services (397%), and Public Safety (384%). In the case of Community Services, much of the increase can be attributed to adding library services and park maintenance functions to the Department. In the case of Public Safety, much of the increase is reflected in increased police service personnel During the same ten-year period, the City of La Quinta general fund revenues increased 259%. Sources that exceeded the average include intergovernmental (623%), interest earnings (334%), and taxes (281%). 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 interest earnings, the increase is due to greater General Fund reserves and additional advances between the General Fund and the Redevelopment Agency. And finally, the increase in taxes is due greatly to the increase in sales tax revenues from the commercial development along Highway 1 1 1. 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, Redevelopment Agency 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 85,940 versus the current 42,958, the annual revenues into the General Fund will be $30 million less than expenditures. With this information, 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. During Fiscal Year (FY) 07/08, the General Fund balance increased by $7.8 million consisting of revenue increases in the following categories: taxes, license and permit fees, and interest earnings. In addition, expenditures were less than budgeted in the general administration, public safety, including police and fire, community services, planning and development, and public works. The General Fund Balances as of June 30, 2008 was $92.5 million of which $45.5 million versus $28.4 million in FY 2006/2007 was reserved and $47.0 million versus $56.2 million in FY 2006/2007 was unreserved with designations. These designations include an emergency reserve set at 35% of the annual budget plus $4,000,000 and a cash flow reserve of 8.25% of the annual budget. Other designations of the General Fund balances at year end can be found in the Footnotes to the Financial Statements. 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. iv 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 and the La Quinta Redevelopment Agency 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 $68.6 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. Relevant, Financial Policies The State of California has mandated in the past that the City of La Quinta, pursuant to State of California Revenue and Taxation Code Section 97.70, contribute $332,000 from the General Fund in FY 05/06 with a similar amount in FY 04/05 to meet the State budget crisis. Also, since FY 02/03 through FY 05/06, the La Quinta Redevelopment Agency has contributed $7.8 million to the State of California pursuant to State of California Health and Safety Code 33681.12 to meet its budget shortfalls. The $7.8 million of funds that have been diverted to the State will not be refunded and are not be available for use within the City of La Quinta. While no State mandated contributions were required in FY 06/07 and FY 07/08, the State budget crisis of FY 08/09 will result in an additional diversion of $4.9 million from the La Quinta Redevelopment Agency for a total take away of $12.7 million. V Major Initiatives A major initiative is the construction of the Vista Dunes Courtyard Homes ($35.2 million) on a former mobile home park which is utilizing the latest energy saving "Green" technologies in its design and construction. The project was recently awarded a Platinum award from the Leadership in Energy and Environmental Design (LEED) Green Building Rating System". Funding for the project came from a bond issue of$90 million in bonds ($65 million in new funds) to develop low and moderate income housing to meet State mandates. The La Quinta Redevelopment Agency (Agency) will be repaying the debt service of the bond issue with property tax increment funds. The Agency will be spending a considerable amount of effort to acquire sites and facilitate the development of these units in the upcoming years which include a partnership with the Coachella Valley Housing Coalition to break ground on a 218 -unit affordable rental housing project on fifteen acres at the northwest corner of Dune Palms Road and Avenue 48 in the City of La Quinta. The Agency's financial commitment toward this project is $30.1 million. The City has two major public facility expansions that have been completed in 2008 - the City Hall expansion and the City Museum. Both of these facilities will better serve the growing needs of the community. The La Quinta Redevelopment Agency 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 with the second course in the planning stages. The Agency continues to seek quality development opportunities for future hotel(s) on the property. Awards and Acknowledgements The Government Finance Officers Association (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, 2007. This was the eleventh 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 organized CAFR that satisfied 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. Vi 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, 7 Thomas P. Genovese John M. Falconer City Manager Finance Director Vii City of La Quinta Directory of Officials June 30, 2008 CITY COUNCI Don Adolph, Mayor Lee Osborne, Mayor Pro Tem Terry Henderson, Council Member Stanley Sniff, Council Member Toni Kirk, Council Member ADMINISTRATION Thomas P. Genovese, City Manager Bret Plumlee, Assistant City Manager -Management Services Doug Evans, Assistant City Manager — Development Services John M. Falconer, .Finance Director Tom Hartung, Building & Safety Director Les Johnson, Planning Director Kathy Jenson, City Attorney Edie Hylton, Community Services Director Veronica Montecino, City Clerk Tim Jonasson, Public Works Director/City Engineer EI4 U 8 O L n SUN E pp baa a•E�� a a 3 _ saa w B.. u ° o qo ao U0 00 sZ 4 aag w y m d inE E6 `O U' FEU-moo5 40 = o EQW y m U amm m' a �® c yJt �rv'c .N°_Sa ua ma .��v E�.6 $ E E U W a a ,n „ C�jN�CNCyW a n �D6 Qq, .g Q.�.W �5 A e.- A~--�i�Lbfyy E* to' o � ga uN43 Wa¢"Qy�idC�cc i E E y1- F E_L" -2 N` m G A a �c 2-- A o� -02-- A 02-- AEU i.S'ou �N.�yrvQ�foi cJiLL� 33. yU y y 1 a !X Certificate of Achievement for Excellence in Financial Reporting Presented to City of LaQuinta California For its Comprehensive Annual Financial Report for the Fiscal Year Ended June 30, 2007 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. WO 0.CI�S�fA.SfRr t k President SEAL QUO Executive Director Lanee Brandon W. Burrows Donald L. Parker S' 0" & Michael K. Chu L u n g h a rd Ln LLP David E. Hale A Professional Corporation Donald G. Slater Richard K. Kikuchi Certified Public Accountants Retired Robert C. Lance 1914-1994 Richard C. Soil Fred J. Lunghard, Jr. 1928-1999 INDEPENDENT AUDITORS' REPORT To the Honorable Mayor and Members of the 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, 2008, which collectively comprise the City's basic financial statements as listed in the accompanying table of contents. These financial statements are the responsibility of the City of La Quinta's management. Our responsibility is to express an opinion 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 significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audit provides a reasonable basis for our opinions. In our opinion, the financial statements referred to above present fairly, in all material respects, the respective financial position of the governmental activities, the business -type activities, each major fund, and the aggregate remaining fund information of the City of La Quinta as of June 30, 2008, and the respective changes in financial position and cash flows, where applicable, and the respective budgetary comparisons for the General Fund and the Low/Moderate Income Housing PA 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 7, 2008, on our consideration of the City 'of La Quinta's internal control over financial reporting and our tests of its compliance with certain laws, regulations, contracts, grant agreements and other matters. The purpose of that report is to describe the scope of our testing of internal control over financial reporting and compliance and the results of that testing, and not to provide an opinion on the internal control over financial reporting or on compliance. That report is an integral part of an audit performed in accordance with Government Auditing Standards and should be considered in assessing the results of our audit. The management's discussion and analysis is not a required part of the basic financial statements, but is supplementary information required by the Governmental Accounting Standards Board. We have applied certain limited procedures, which consisted principally of inquiries of management regarding the methods of measurement and presentation of the required supplementary information. However, we did not audit the information and express no opinion on it. 75 "EA I?S l 1929 2i1{) 203 N. Brea Blvd., Suite 203 9 Brea, CA 92821-4056 • (714) 672-0022 9 Fax (714) 672-033 t • www.lslcoas.com q=Up=d CMIW*a IVJW.c rcrxrnruwz To the Honorable Mayor and Members of the City Council City of La Quinta, California Our audit was conducted for the purpose of forming opinions on the financial statements that collectively comprise the City's basic financial statements. The accompanying introductory section, the combining and individual fund statements, schedules and statistical tables are presented for purposes of additional analysis and are not a required part of the basic financial statements. The accompanying combining and individual nonmajor fund financial statements and schedules have been subjected to the auditing procedures applied in the audit of the basic financial statements, and, in our opinion, are fairly stated in all material respects in relation to the basic financial statements taken as a whole. The accompanying introductory section and statistical tables have not been subjected to the auditing procedures applied in the audit of the basic financial statements and, accordingly, we express no opinion on them. November 7, 2008 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, 2008. 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 $548,371,000 (net assets). Of this amount, $76,533,000 (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 $52,265,000 and the Business -Type total net assets decreased by $638,000 attributable to SilverRock Golf Course. • As of the close of the current fiscal year, the City of La Quinta's governmental funds reported combined ending fund balances of $187,825,000, a decrease of $14,179,000 in comparison with the prior year. Approximately 70 percent of this total amount, $130,815,000, is available for spending at the government's discretion (unreserved fund balance). At the end of the current fiscal year, the operations/projects/transfers designations comprised $16,734,000 or 42 percent of total general fund budgeted expenditures. The City of La Quinta's total debt decreased by $5,813,000 during the current fiscal year from $247,478,000 to $241,665,000 through normally scheduled debt service payments. 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. 3 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 distinguish functions of the City of La Quinta that are principally supported by taxes and intergovern- mental 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 Redevelopment Agency and the La Quinta Financing 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. 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. 2 Governmental funds Governmental funds are used to account for essentially the same functions reported as governmental activities in the government -wide financial state- ments. 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 govern- ment -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, one (1) special revenue fund, two (2) debt service funds and three (3) capital project funds. 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. 5 Proprietary funds Proprietary funds can be broken down into enterprise and internal service funds. The City of La Quinta maintains one (1) proprietary 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, Expenditures 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 statement 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 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, this report also presents certain required supplementary information concerning the City of La Quinta's General Fund and its budget appropriations. Required supplementary 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. R The combining statements referred to earlier in connection with non -major govern- mental funds, internal service funds, and agency funds are presented immediately following the required supplementary. 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 govern- ment's financial position. In the case of the City of La Quinta, assets exceeded liabilities by $548,371,000 at the close of the most recent fiscal year, which is $51,627,000 greater than the previous year. The largest portion of the City of La Quinta's net assets, which was 70% this year and 69% 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 Current and other assets Governmental activities 2008 2007 5 233,280,016 $ 244,280,997 S Business -type activities 2008 2007 (2,917,790) $ (2,019,993) Total 2008 S 230,362,226 $ 2007 242,261,004 Capital assets 636,929,916 477,813,364 43,459,062 43,517,873 580,388,978 521,331,237 Total assets 770,209,932 722,094,361 40,541,272 41,497,880 810,751,204 763,592,241 Current liabilities 21,364.433 19,882,003 191,734 365,469 21,556,167 20,247,472 Non-current liabilities 240,142,684 245,774,853 681,047 825,848 240,823,927 246,600,701 Total liabilities 261,547,313 265,656,856 872,781 1,191,317 262,380,094 266,848,173 Net assets: Invested in capital assets, net of related debt 343,019,328 300,220,033 42.778.015 42,692,025 385,797,343 342,,912,058 Restricted 86,041,189 49.277,895 - 86,041,189 49,277,895 Unrestricted 79,642,102 106,939,577 {3,109,5241 (2,385,462) 76,532,578 104,554,115 Total net assets 5 508,702,619 5 456,437,505 $ 39,668,491 S 40,306,563 S 548,371,110 $ 496,744,068 7 An additional portion of the City of La Quinta's net assets (16 percent, versus 10 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 - $76,533,000 (14 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 53,1 10,000. Governmental activities Governmental activities increased net assets by $52,265,000 accounting for an 11 percent change in the net assets from the previous year. Key elements of these changes are as follows: City of L a Quinta Changes in Net Assets P rapertY taxesf, l 4, 5 Governmental ausmoss-typo - r, 14, ,,1.5106;v- activrucs aciMtias 0111,1 tile! In xgs Total JJ, ftevanues: 2006 2r10'1 l:1*n 0. 2008 2007 ['1+ iiN,J4 2008 7007 Cdknga poagram Ipuonvesi +tveslnWnl n+cerne .4 1 IMS4.951 t . A,4 :I4,30 - Ctlargeslorservices 4,467.560 5,57.0,009 (1.053,3491 3.814.23$ 3.540,748 273,485 8,281,793 9.061,657 1779.81341 Waits ung grants and 1 -. con9ibullons 5,905.664 3,796,495 21109,169 - 5,905.G64 3,796,495 2,109,169 C.Ipllat grants and , ISce lailrimis contributmns 50.090.419 17,601,131 32,409,288 - - 50,090,419 17.601,131 32,489,286 P rapertY taxesf, l 4, 5 $.016.2U4 - r, 14, ,,1.5106;v- bl . 1, 5, 4 0111,1 tile! In xgs 1,1 JJ, I _ I J ,---77m-r M +tveslnWnl n+cerne .4 1 IMS4.951 t . A,4 :I4,30 -1,a t -;4� I .. 4, 11.814.768 0471-5W) Motor vehicle rrt wn V102,54 1 3, is 1,0!i5 1 -. sin 110111 eR sa OEAPAII asself J , , ISce lailrimis 1, , 5 'M ( , 1, 1', I e14 7e v@1[Wy r4 14B.05,J14 3 1,94 7.44 a 3,818,60.64 .,5 J 144. al g4vcrrtn+em n - I - ., a �'3 r n1ticSAoIY I 1 T7 .,1 R - 1.. 4 7 2.036 12. 4,1DO . 7,17.936 I, i 16 4.2".41a2 i inning and @ aommv1„ !'1 • fi -il 11 F iC werk,a 1 1 ,y„ - 1 5,. 5 - I}IL1011 pll W1g•lel nl e A �, - .J 1 ribil M.Fse - 4• ,1 4,IN 4. , 12,0 ON at axponses WIM.M0t9. 7 t I 3T. i, „I . J.. J 491.239.004 31.135.468 Increase rn net assets Wore trans(ors and restatements 52.205,114 51,764.005 505,10$ {590.75x]1 (rJ7'70013Y !13,1$1) 51,274,3145 00,786,397 487.958 fPfia efa 1874,U51 8 6 c eou, A,tiatls _ lieslalnnmrals J, .. 1 - f lr Incro84e vt n41 as"Is -,} S 7 4 1102,9631 , 1 I SII.524M42 5 1.4 MGM14 , NLI 4slfls• PIW.437.15 5 -Tolmuol SI.588,623 1 4A .4-F1-.TWW Net asscls - 6130120GO 508,M2.099 4513,4 31.505 57,26m 14 39,661,491 ,4 110 ,300,56.1 ,J .I 640.111,110 40.744.000. • Revenues increased by $31,947,000 with the largest category increases in capital grants and contributions $32,489,000). Capital grants and contributions increased as a result of the acquisition of Highway 111 from Caltrans in January 2008 for $37,617,000. D • Expenses increased by $31,446,000 with the two largest category increases in Planning and Development ($27,587,000) and Community Services ($1,498,000). The increase in the Planning and Development costs is a result of completion of the Vista Dunes Courtyard homes and the construction of the Wolff Waters Apartments. The increase in the Community Services costs is a result of the expansion of the library and museum. • A contribution of $353,000 in assets from the governmental activities to the business -type activities which consist of land and improvements for the SilverRock Golf course. Expenses and Program Revenues -Government Activities 60,000,000 50,000,000 40,000,000 35,323,858 30,000,000 20,000,000 13,472,036 11,09 4,942,194 10,000,000 ' 6,953,073 5,797,116 13,130.638 3,814,063 8,328 EJ General Public safety Community services Planning and government development 5,000,000 4,800,000 4,600,000 4,400,000 4,200,000 4,000,000 3,800,000 r 48,568,420 :D Public works Interest expense Expenses and Program Revenues- Business -type Activities 4,809,302 Golf EiExpenses - — q Pr*W nl revenues t3 Expenses o Program revenues Business -type activities "'This was the third full year of operations for the SilverRock Golf fund since the golf course began early operation in 2005. Net assets decreased by $ (638,000) from the net effects of a capital contribution from the governmental activities of $353,000 and an operating loss of $(991,000). Charges for services primarily consisted of green fees and totaled $3,814,000 which was $273,000 greater than the previous year with golf course expenses of $4,809,000, which was $289,000 greater than the previous year. 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 spendable resources. 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. As of the end of the current fiscal year, the City of La Quinta's governmental funds reported combined ending fund balances of $187,825,000, a decrease of $14,179,000 in comparison with the prior year. Of this ($130,815,000) or 70% constitutes unreserved, which is available for spending at the government's discretion. The remainder of fund balance ($57,010,000) is reserved or designated to indicate that it is not available for new spending because it has already been committed to 1) to pay debt service ($5,084,000), 2) to advance funds to other funds ($49,667,000), or 3) for a variety of other restricted purposes ($2,259,000), General Fund The general fund is the chief operating fund of the City of La Quinta. At the end of the current fiscal year, unreserved fund balance of the general fund was $47,010,000, while total fund balance reached $92,452,000. As a measure of the general fund's liquidity, it may be useful to compare the fund balance total budgeted expenditures (including transfers out). The total fund balance represents 231 percent of the total budgeted expenditures. 10 The City of La Quinta's general fund balance increased by $7,811,000 during the current fiscal year. Key factors in this growth are as follows: a Actual expenditures were $6,217,000 less than the final budget. Divisions that were under budget for the year were Street Maintenance ($1,097,000), Police ($814,000), Fire ($580,000), Planning & Development Administration ($920,000), and the Current Planning Division ($446,000). • An increase of $483,000 in licenses and permits over the final budget, which represents increased development and building activity in the Public Works and Building and Safety department. • An increase of $387,000 in interest income over the budget, which is a result of higher than budgeted interest rates and larger amounts under investment. Low/Moderate Income Housing PA No. 2 Fund The Low/Moderate Income Housing No. 2 Fund is used to account for the promotion of low and moderate income capital projects in the La Quinta Redevelopment Project Area 2 from 20% of the tax increment property tax generated in this Project Area. During the previous Fiscal Year 2006-2007, this fund purchased twenty acres (20) for $19,966,000 which represented the major expenditures in this Fund. In the current Fiscal Year 2007-2008, this fund received $9.4 million reimbursement for a portion of this land which will not be used for low/moderate income housing. This land will be used for commercial purposes along Highway 1 1 1 . Capital Improvement Fund The fund is primarily used to record the expenditure of funds for capital projects. Major capital projects funded during Fiscal Year 2007-2008 were Vista Dunes Courtyard Homes, Wolff Waters Apartments, City Hall and Museum expansion, and the Ave 52 median improvements. Redevelopment Agency Project Area 1 Capital Projects Fund The fund is primarily used to account for the construction of projects in this area within the Redevelopment Agency Project Area 1 which is generally south of Ave 50. The major funding for these projects was a $25 million transfer from the Debt Service Fund for capital projects including the permanent SilverRock Clubhouse and SilverRock infrastructure improvements. 11 Civic Center Fund The fund is primarily used to collect developer impact fees for the construction of the City Hall expansion and to record the costs of those improvements. The City Hall expansion was completed in Fiscal Year 2007-2008. Redevelopment Agency Project Area 1 & 2 Debt Service Funds The Redevelopment Agency Project Area 1 & 2 Debt Service Funds are used to accumulate resources, primarily property taxes, to pay debt service. The fund balance decreased by $16.3 during the current fiscal year in the Redevelopment Agency Project Area 1 . The key factor in this decrease was a $25.0 million transfer to the Redevelopment Agency Project Area 1 Capital Project Fund which was offset by an increase in tax increment property tax generated in the project area, and not having to pay to the State of California an Educational Relief Augmentation Fund (ERAF) payment. The fund balance decreased by $7.4 during the current fiscal year in the Redevelopment Agency Project Area 2. The key factor in this decrease was a $9.4 million transfer to the Low/Moderate Income Housing PA No. 2 Fund, which was offset by an increase in tax increment property tax generated in the project area, and not having to pay to the State of California an Educational Relief Augmentation Fund (ERAF) payment. 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 $1,489,000 increase in appropriations and transfers out between the original ($38,448,000) and final amended budget ($39,937,000). Following are the main components of the increase: 12 • $243,000 supplemental appropriation to the General Government City Manager Division for a donation to the Wildlife Conservation Fund for the purchase of land in section 5; and, • $250,000 supplemental appropriation tot eh Community services Administration Division toward construction of the Food In Need of Distribution (FIND) Indio building Fund; and, • $584,000 and $170,000 carry over appropriations to the General Government Planning Administration and Current Planning Divisions, respectively, for professional studies. In addition, the FY 2007-2008 budget included carryover encumbrances of $161,500 and $2,674,000 in carryover appropriations into FY 2008-2009 The budget increases were possible because of additional anticipated revenues 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, 2008, amounts to $580,389,000 (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. City of La Quinta Capital Assets (net of depreciation) Governmental activities Business -type activities Total 2008 2007 2008 2007 2008 2007 Land $ 80,645,874 $ 5,077,785 S 36,840,832 $ 36,458,147 $ 117,486,706 S 111,535,932 dmaings ana improvements 44,355,498 28,033,383 5,832,933 6,021,704 50,188,431 34,055,087 Equipment and furniture 913,530 755,425 773,115 1,017,719 1,686,645 1,773,14T- ,7 3,144Vehicles Vehicles 656,934 522,287 6,105 10,175 662,039 532,462 Software 6,077 10,128 6,077 10,128 Inflaaructure 370,659,873 330,762,340--370,659.873 336,762,370— 3 ,76 ,340onstruction Constructionin progress _ - 39,699.207 42,662,144 Total $ 536,09,916 477,813,364 43, %9,062 S 43,517,873 $ 580,386,978 521,331, 37 13 Major capital asset events during the current fiscal year included the following: Governmental activities • Recording infrastructure improvements totaling $37,617,000 for Highway 111 for street improvements, street right of way, street sidewalks, traffic signals, curbs and gutters, and street medians based upon the transfer of ownership from the State of California to the City of La Quinta in January 2008; • Recording the land, park buildings and equipment in the park equipment and facility internal service fund which totaled $136,400; • Purchasing a new Compressed Natural Gas (CNG) street sweeper for $234,000 in the Equipment Replacement Fund; • Recording infrastructure improvements, including developer dedications of $2,822,000, to street improvements, street right of way, street sidewalks and curbs and gutters, and street median; Completed construction of the City Hall which totaled $13,913,000; • Completed construction of the Museum expansion totaled $3,332,000; • Completed the Phase 2 Library expansion which totaled $525,000; • Recording the transfer of assets, which were improvements made to land from the Redevelopment Agency to the SilverRock Golf Enterprise Fund had a cost basis of $353,000. Business -type activities • Recording improvements to the golf course for the first golf course at SilverRock Resort totaled $353,000. Additional information on the City of La Quinta's capital assets can be found in Footnote 6 to the financial statements. 14 Long-term debt At the end of the current fiscal year, the City of La Quinta had total bonded debt outstanding of $240,984,000, $142,265,000 of this debt amount represents bonds secured solely by specified revenue sources (i.e., tax allocation bonds); while, $91,715,000 of the debt represents revenue bonds that will be paid from pledged tax increment property tax housing funds. In addition, $681,000 in capital equipment leases is outstanding in connection with SilverRock Golf Course. City of La Quinta Outstanding Debt Debttype: Capital leases Governmental activities 2008 2007 $ 182,094 Business -type activities 2008 2007 681,047 Total 2008 2007 863,141825,841T- mpensaled absences 833,155 734.W B33.155 , 4i. 5 Developer agreement 499,786 64J,539 499,186- 9 ,7 6Pass Passthrough agreement 3,rSi�O,(i21 4,431 ,178 31660,621 4,431.178 Due to government agencies 1,828,311 2,028.311 1,828,311 2,026,31.1 ax allocaunn barlas 142.265,000_ _142.265,00 145,170,000 evenue bonds 91,715,000 .13.M,000 91,715,00 3,645,000 otal $ 240,983,R7 5 246,15b2,M3$ 681,047 805,848 5 241,665,014 $ 247147 ,931 The City of La Quinta's total outstanding debt decreased by $5,813,000 during the fiscal year. Additional information on the City of La Quinta's long-term debt can be found in notes 7 and 8 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 the 2009 fiscal year: • The City of La Quinta had a 4.3 percent unemployment rate. This rate is significantly lower than the Riverside County unemployment rate of 8.4 percent and the statewide unemployment rate of 7.0 percent. • During the last ten years, the City of La Quinta has been in a growth phase with net assessed values increasing from $2.69 billion in FY 98/99 to $12.52 billion or over 465 percent. • During the current fiscal year, the general fund net income was $7,812,000. $2,836,000 of this amount has been designated to the general fund for carry over appropriations and encumbrances. 15 • The State of California budget includes a $350 million State-wide diversion of tax increment funding from of which the La Quinta Redevelopment Agency total will be $4.9 million. The City of La Quinta adopted a balanced general fund budget for FY 08/09. 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, John Falconer, Finance Director, P.O. Box 1504, La Quinta, CA, 92247 or by telephone at 760-777-7150. 16 CITY OF LA QUINTA STATEMENT OF NET ASSETS JUNE 30, 2008 Assets: Cash and investments Receivables: Accounts Taxes Loans and notes Accrued interest Internal balances Prepaid costs Inventories Deposits Due from other governments Deferred charges Restricted assets: Cash with fiscal agent Capital assets not being depreciated Capital assets, net of depreciation Total Assets Liabilities: Accounts payable Accrued liabilities Accrued interest Deposits payable Due to other governments Retentions payable Unearned revenue Noncurrent liabilities: Due within one year Due in more than one year Total Liabilities Net Assets: Invested in capital assets, net of related debt Restricted for: Public safety Planning and development Community services Public works Debt service Unrestricted Total Net Assets See Notes to Financial Statements 17 Primary Government Governmental Business -Type A ..4:..:4:.... A—A:..:I:�� T_a_ $ 155,758,886 $ 169,001 $ 155,927,887 71,960 12,090 84,050 3,288,662 - 3,288,662 13,126,460 - 13,126,460 720,498 488 720,986 3,415,275 (3,415,275) 2,351,210 15,954 1,865 17,819 - 64,041 64,041 4,825 250,000 254,825 11,478,359 - 11,478,359 4,567,730 4,567,730 40,831,407 403,021,507 133.908,409 36,840,832 6,618,230 40,541,272 40,831,407 439,862,339 140,526,639 810,751,204 7,605,489 151,711 7,757,200 377,567 1,757 379,324 4,151,161 - 4,151,161 4,400,383 37,000 4,437,383 1,330,038 - 1,330,038 2,351,210 - 2,351,210 1,148,585 1,266 1,149,851 7,128,020 395,831 7,523,851 233,014,860 285,216 233,300,076 261,507,313 872,781 262,380,094 343,019,328 42,778,015 385,797,343 6,868 - 6,868 29,267,560 29,267,560 1,016,336 1,016,336 50,655,135 50,655,135 5,095,290 5,095,290 79,642,102 (3,109,524) 76,532,578 $ 508,702,619 $ 39,668,491 $ 548,371,110 CITY OF LA QUINTA STATEMENT OF ACTIVITIES YEAR ENDED JUNE 30, 2008 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 Program Revenues Operating Capital Charges for Contributions Contributions Expenses $ 6,953,073 $ 8,328 $ $ 13,472,036 2,050,492 1,059,039 21,107 35,323,858 134,211 168,483 3,511,369 5,797,116 374,092 3,661,071 907,031 11,097,526 1,900,437 1,017,071 45,650,912 15,522,441 - - - 88,166,050 4,467,560 5,905,664 50,090,419 Total Business -Type Activities 4,809,302 3,814,233 Total Primary Government $ 92,975,352 $ 8,281,793 General Revenues: Taxes: Property taxes, levied for general purpose Tax increment Sales taxes Transient occupancy taxes Franchise taxes Business licenses taxes Other taxes Use of money and property Motor vehicle in lieu, unrestricted Gain on sale of capital assets Other 352,687 - 352,687 $ 5,905,664 $ 50,443,106 Total General Revenues 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 $ (6,944,745) $ (10,341,398) (31, 509,795) (854,922) 37,470,894 (15,522,441) (27,702,407) $ (6,944,745) (10,341,398) (31, 509, 795) (854,922) 37,470,894 (15,522,441) (27,702,407) - (642,382) (642,382) (642,382) (642,382) (27,702,407) (642,382) (28,344,789) 6,014,305 6,014,305 42,114,893 42,114,893 8,492,213 8,492,213 5,327,203 5,327,203 1,748,082 1,748,082 317,011 317,011 641,705 - 641,705 10,230,489 4,310 10,234,799 3,803,647 - 3,803,647 57,346 57,346 1,220,627 - 1,220,627 79,967,521 4,310 79,971,831 52,265,114 (638,072) 51,627,042 456,437,505 40,306,563 496,744,068 $ 508,702,619 $ 39,668,491 $ 548,371,110 See Notes to Financial Statements 19 CITY OF LA QUINTA BALANCE SHEET GOVERNMENTALFUNDS JUNE 30, 2008 See Notes to Financial Statements 20 Special Revenue Fund Capital Projects Funds Low/Moderate Redevelopment Income Housing Capital Agency General PA No. 2 Improvement PA No. 1 Assets: - — - - Cash and investments $ 51,656,663 $ 10,677,080 $ 5,839,548 $ 22,894,794 Receivables: Accounts 7,930 - 2,274 - Taxes 3,288,662 - - - Notes - 9,443,802 - Accrued interest 325,300 57,177 - 97,051 Prepaid costs 10,601 971 1,170 Deposits 4,825 - - Due from other governments 7,888,347 122,953 645,158 - Due from other funds 19,414 5,684,047 - - Advances to other funds 45,264,966 - - 3,462,579 Restricted assets: Cash and investments with fiscal agents - - 16,703,089 Total Assets $ 108,466,708 $ 25,986,030 $ 6,486,980 $ 43,158,683 Liabilities and Fund Balances: Liabilities: Accounts payable $ 3,989,294 $ 27,053 $ 3,451,787 $ 34,495 Accrued liabilities 375,236 - - - Deposits payable 3,863,315 - 299,826 Due to other governments 268 1,501 - Retentions payable - 2,351,210 Deferred revenues 7,786,576 9,443,802 Unearned revenue - - 384,157 Due to other funds - - Advances from other funds - Total Liabilities 16,014,689 9,472,356 6,486,980 34,495 Fund Balances: Reserved: Reserved for encumbrances 161,504 - Reserved for prepaid costs 10,601 971 - 1,170 Reserved for deposits 4,825 - Reserved for notes receivable - Reserved for advances to other funds 45,264,966 3,462,579 Reserved for debt service - Unreserved: Unreserved, reported in: General Fund 47,010,123 Special revenue funds - 16,512,703 - Capital projects funds - 39,660,439 Debt service funds - - - Total Fund Balances 92,452,019 16,513,674 - 43,124,188 Total Liabilities and Fund Balances $ 108,466,708 $ 25,986,030 $ 6,486,980 $ 43,158,683 See Notes to Financial Statements 20 CITY OF LA QUINTA - $ 16,551,746 $ 14,801,552 $ 28,809,909 BALANCE SHEET Accrued liabilities GOVERNMENTALFUNDS - - - 61,756 JUNE 30, 2008 - 237,242 (Continued) Notes - 434,266 3,682,658 Accrued interest Capital 64,622 106,328 Prepaid costs Projects Funds Debt Service Funds 3,212 Deposits _ _ Redevelopment Redevelopment Other Due from other governments Civic Agency Agency Governmental Due from other funds Center PA No. 1 PA No. 2 Funds Assets: Cash and investments $ - $ 16,551,746 $ 14,801,552 $ 28,809,909 Receivables: Accrued liabilities Accounts - - - 61,756 Taxes - 237,242 Due to other governments Notes - 434,266 3,682,658 Accrued interest 51,531 64,622 106,328 Prepaid costs - - 3,212 Deposits _ -- Due from other governments 1,365,786 491,811 964,304 Due from other funds - - 312,000 Advances to other funds 9,393,000 - 939,634 Restricted assets: Total Liabilities 9,393,000 12,884,566 Cash and investments with fiscal agents - - 24,128,318 Total Assets $ $ 17,969,063 $ 15,357,985 $ 59,008,119 Liabilities and Fund Balances: Liabilities: Accounts payable $ $ $ $ 77,593 Accrued liabilities Deposits payable - 237,242 Due to other governments - 884,566 434,266 9,437 Retentions payable - - - - Deferred revenues - - 1,924,986 Unearned revenue - - 764,428 Due to other funds - 6,015,461 Advances from other funds 9,393,000 12,000,000 19,378,966 5,479,938 Total Liabilities 9,393,000 12,884,566 19,813,232 14,509,085 Fund Balances: Reserved: Reserved for encumbrances - _ _ Reserved for prepaid costs - - - 3,212 Reserved for deposits _ _ - Reserved for notes receivable - - - 2,076,063 Reserved for advances to other funds - - 939,634 Reserved for debt service - 5,084,497 -- Unreserved: Unreserved, reported in: General Fund Special revenue funds - - - 15,906,365 Capital projects funds (9,393,000) - - 25,563,622 Debt service funds - - - (4,455,247) 10,138 Total Fund Balances (9,393,000) 5,084,497 (4,455,247) 44,499,034 Total Liabilities and Fund Balances $ - $ 17,969,063 $ 15,357,985 $ 59,008,119 See Notes to Financial Statements 21 CITY OF LA QUINTA BALANCE SHEET GOVERNMENTAL FUNDS JUNE 30, 2008 Total Assets Liabilities and Fund Balances: Liabilities: Accounts payable Accrued liabilities Deposits payable Due to other governments Retentions payable Deferred revenues Unearned revenue Due to other funds Advances from other funds Total Liabilities Fund Balances: Reserved: Reserved for encumbrances Reserved for prepaid costs Reserved for deposits Reserved for notes receivable Reserved for advances to other funds Reserved for debt service Unreserved: Unreserved, reported in: General Fund Special revenue funds Capital projects funds Debt service funds Total Fund Balances Total Liabilities and Fund Balances See Notes to Financial Statements 22 $ 276,433,568 7,580,222 375,236 4,400,383 1,330,038 2,351,210 19,155,364 1,148, 585 6,015,461 46,251,904 88,608,403 161,504 15,954 4,825 2,076,063 49,667,179 5,084,497 47, 010,123 32,419,068 55,831,061 4,445,109) 187,825,165 $ 276,433,568 Total Governmental Funds Assets: Cash and investments $ 151,231,292 Receivables: Accounts 71,960 Taxes 3,288,662 Notes 13,126,460 Accrued interest 702,009 Prepaid costs 15,954 Deposits 4,825 Due from other governments 11,478,359 Due from other funds 6,015,461 Advances to other funds 49,667,179 Restricted assets: Cash and investments with fiscal agents 40,831,407 Total Assets Liabilities and Fund Balances: Liabilities: Accounts payable Accrued liabilities Deposits payable Due to other governments Retentions payable Deferred revenues Unearned revenue Due to other funds Advances from other funds Total Liabilities Fund Balances: Reserved: Reserved for encumbrances Reserved for prepaid costs Reserved for deposits Reserved for notes receivable Reserved for advances to other funds Reserved for debt service Unreserved: Unreserved, reported in: General Fund Special revenue funds Capital projects funds Debt service funds Total Fund Balances Total Liabilities and Fund Balances See Notes to Financial Statements 22 $ 276,433,568 7,580,222 375,236 4,400,383 1,330,038 2,351,210 19,155,364 1,148, 585 6,015,461 46,251,904 88,608,403 161,504 15,954 4,825 2,076,063 49,667,179 5,084,497 47, 010,123 32,419,068 55,831,061 4,445,109) 187,825,165 $ 276,433,568 CITY OF LA QUINTA GOVERNMENTAL FUNDS RECONCILIATION OF THE BALANCE SHEET OF GOVERNMENTAL FUNDS TO THE STATEMENT OF NET ASSETS JUNE 30, 2008 Fund balances of governmental funds $ 187,825,165 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: Infrastructure and right-of-way 434,497,635 Other capital assets 157,515,002 Accumulated depreciation (71,649,786) Bonds payable (233,980,000) Unamortized bond premium/discount 841,087 Unamortized cost of issuance 4,567,730 Other long-term liabilities (6,170,812) Compensated absences (829,227) Accrued interest payable for the current portion of interest due on long-term debt has not been reported in the governmental funds. (4,151,161) 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. 19,155,364 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. 21,081,622 Net assets of governmental activities $ 508,702,619 See Notes to Financial Statements 23 CITY OF LA QUINTA STATEMENT OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCES GOVERNMENTAL FUNDS YEAR ENDED JUNE 30, 2008 Revenues: Taxes Assessments Licenses and permits Intergovernmental Contribution from property owners Charges for services Use of money and property Fines and forfeitures Contributions Miscellaneous Developer participation Loan repayments 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 Excess (Deficiency) of Revenues Over (Under) Expenditures Other Financing Sources (Uses): Transfers in Transfers out Capital leases Proceeds from sale of capital assets Total Other Financing Sources (Uses) Net Change in Fund Balances Fund Balances, Beginning of Year Fund Balances, End of Year Special Revenue Fund Capital Projects Funds Low/Moderate Redevelopment Income Housing Capital Agency $ 22,665,855 $ 5,771,938 $ $ 2,107,035 9,142,554 1,311,904 - 154,417 - 1,213,519 5,239,552 853,823 1,411,698 359,114 - - 37,616,690 - - 154,940 115,417 - - 3,618,748 201,379 78,653,676 6,741,178 4,930,652 1,613,077 6,566,585 17,142,443 - - 1,209,935 5,302,598 986,428 2,914,422 - - 5,075,195 - 37,616,690 45, 266,627 193,753 54,701 70,525,270 5,302,598 45,515,081 986,428 8,128,406 1,438,580 (40,584,429) 626,649 313,134 9,378,966 (812,135) (4,380,828) 182,094 - 40,624,429 25,180,355 (40,000) (3,623,184) (316,907) 4,998,138 40,584,429 21,557,171 7,811,499 6,436,718 22,183,820 84,640, 520 10,076,956 20,940,368 $ 92,452,019 $ 16,513,674 $ $ 43,124,188 See Notes to Financial Statements 24 CITY OF LA QUINTA STATEMENT OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCES GOVERNMENTAL FUNDS YEAR ENDED JUNE 30, 2008 (Continued) Revenues: Taxes Assessments Licenses and permits Intergovernmental Contribution from property owners Charges for services Use of money and property Fines and forfeitures Contributions Miscellaneous Developer participation Loan repayments 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 Excess (Deficiency) of Revenues Over (Under) Expenditures Other Financing Sources (Uses): Transfers in Transfers out Capital leases Proceeds from sale of capital assets Total Other Financing Sources (Uses) Net Change in Fund Balances Fund Balances, Beginning of Year Fund Balances, End of Year Capital 3,565,558 Projects Funds Debt Service Funds 273,248 Redevelopment Redevelopment Other Civic Agency Agency Governmental Center PA No. 1 PA No. 2 Funds $ $ 43,476,312 $ 23,087,750 $ 10,869,078 - 909,229 4,927,677 - 951,545 - 120,541 698,250 477,355 2,616,475 26,500 357,890 _ - 2,359,974 - 471,811 357,890 44,174,562 23,565,105 23,252,830 202,764 386,073 202,081 9,641 - - 39,332 - 7,875,199 - 2,422,335 2,892 1,485,407 See Notes to Financial Statements 25 3,565,558 260,000 1,930,000 273,248 8,528,282 1,686,050 4,882,427 23, 585,426 19,403, 597 - 478,904 36,065,339 21,551,728 18,644,341 (121,014) 8,109,223 2,013,377 4.608,489 4,557,990 1,955,846 6,593,962 (6,240,662) (28,970,960) (11,334,812) (31,940,027) - - 158,061 (6,240,662) (24,412,970) (9,378,966) (25,188,004) (6,361,676) (16,303,747) (7,365,589) (20,579,515) (3,031,324) 21,388,244 2,910,342 65,078,549 $ (9,393,000) $ 5,084,497 $ (4,455,247) $ 44,499,034 See Notes to Financial Statements 25 CITY OF LA QUINTA STATEMENT OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCES GOVERNMENTAL FUNDS YEAR ENDED JUNE 30, 2008 Revenues: Taxes Assessments Licenses and permits Intergovernmental Contribution from property owners Charges for services Use of money and property Fines and forfeitures Contributions Miscellaneous Developer participation Loan repayments 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 Excess (Deficiency) of Revenues Over (Under) Expenditures Other Financing Sources (Uses): Transfers in Transfers out Capital leases Proceeds from sale of capital assets Total Other Financing Sources (Uses) Net Change in Fund Balances Fund Balances, Beginning of Year Fund Balances, End of Year See Notes to Financial Statements 26 Total Governmental M mA. $ 105,870,933 909,229 2,107, 035 15, 382,135 1,105,962 1,334,060 11,297,153 359,114 37,643,190 270,357 6,537,991 471,811 183,288,970 7,367,144 17,181,775 15, 374,160 5,336,757 6,563,494 82,883,317 5,949,311 15,424,708 42,989,023 199,069,689 (15,780,719) 88,604,682 (87,342,608) 182,094 158,061 1,602,229 (14,178,490) 202,003,655 $ 187,825,165 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. 2008 Net change in fund balances - total governmental funds Amounts reported for governmental activities in the statement of activities are different because: Governmental funds report capital outlays as expenditures. However, in the statement of activities, the 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 Depreciation expense Repayment of principal is an expenditure in the governmental funds, but the repayment reduces long-term liabilities in the statement of net assets. Accrued interest for long-term liabilities. This is the net change in accrued interest for the current period. 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. 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 net revenues (expenses) of the internal service funds is reported with governmental activities. Change in net assets of governmental activities See Notes to Financial Statements 27 $ (14,178,490) 62,309,970 (3,270,169) 5,545,395 87,946 (99, 341) 2,243,154 (373,351) $ 52,265,114 CITY OF LA QUINTA BUDGETARY COMPARISON STATEMENT BY DEPARTMENT GENERALFUND YEAR ENDED JUNE 30, 2008 Public Safety Police 10,183,852 10,221,691 9,407,689 Variance with Building & safety admin 311,089 296,792 338,040 Final Budget Building Budget Amounts Actual Positive (114,643) Original Final Amounts (Negative_ Budgetary Fund Balance, July 1 $ 84,640,520 $ 84,640,520 $ 84,640,520 $ - Resources (Inflows): Civic Center Building 567,704 594,033 475,189 Taxes 22,420,500 22,490,500 22,665,855 175,355 Licenses and permits 1,393,900 1,623,900 2,107,035 483,135 Intergovernmental 8,219,100 9,624,732 9,142,554 (482,178) Contributions from property owners 130,600 130,600 154,417 23,817 Charges for services 1,322,250 1,241,650 1,213,519 (28,131) Use of money and property 4,152,900 4,852,900 5,239,552 386,652 Fines and forfeitures 267,500 267,500 359,114 91,614 Contributions - 37,616,690 37,616,690 Other - 5,600 154,940 149,340 Capital leases - 182,094 182,094 - Transfers from other funds 342,149 348,540 313,134 (35,406) Amounts Available for Appropriation $122,889,419 $125,408,536 $163,789,424 $ 38,380,888 Charges to Appropriation (Outflow): General Government Legislative $ 974,647 $ 974,649 $ 847,310 $ 127,339 City Manager 397,179 610,272 645,374 (35,102) Development services 2,025,465 2,087,850 1,921,939 165,911 Management services 1,549,223 1,607,632 1,208,229 399,403 City Clerk 655,003 659,523 543,909 115,614 Fiscal services 848,129 830,776 849,270 (18,494) Central services 432,564 614,658 550,554 64,104 Total general government 6,882,210 7,385,360 6,566,585 818,775 Public Safety Police 10,183,852 10,221,691 9,407,689 814,002 Building & safety admin 311,089 296,792 338,040 (41,248) Building 1,034,977 1,039,818 1,154,461 (114,643) Code compliance 1,018,060 1,018,840 908,382 110,458 Animal control 387,908 387,908 353,834 34,074 Civic Center Building 567,704 594,033 475,189 118,844 Fire 4,862,052 4,955,724 4,375,301 580,423 Emergency services 137,357 137,357 129,547 7,810 Total public safety 18,502,999 18,652,163 17,142,443 1,509,720 Communitv Services Community services admin 969,242 1,278,042 987,276 290,766 Senior center 442,112 445,112 373,845 71,267 Park & recreation 227,521 228,041 202,137 25,904 Park maintenance 1,371,678 1,398,178 1,351,164 47,014 Total community services 3,010,553 3,349,373 2,914,422 434,951 Planning and Development Administation 1,025,668 1,614,080 694,007 920,073 Current planning 759,094 961,594 515,928 445,666 Total planning and development 1,784,762 2,575,674 1,209,935 1,365,739 See Notes to Financial Statements 28 CITY OF LA QUINTA BUDGETARY COMPARISON STATEMENT BY DEPARTMENT GENERALFUND YEAR ENDED JUNE 30, 2008 Public Works Administration Development services Maintenance/operations - Street Maintenance/operations - Lighting Traffic Construction management Total public works Capital outlay Transfers to other funds Total Charges to Appropriations Budgetary Fund Balance, June 30 Budget Amounts Original Final Actual Amounts Variance with Final Budget Positive (Negative) $ 539,578 $ 569,825 $ 468,308 $ 101,517 1,154,631 1,279,367 1,051,420 227,947 1,824,891 1,939,636 842,383 1,097,253 1,030,307 1,052,873 905,902 146,971 1,035,523 852,644 474,052 378,592 682,978 680,904 1,333,130 (652,226) 6,267,908 6,375,249 5,075,195 1,300,054 - - 37,616,690 (37,616,690) 1,999,460 1,599,532 812,135 787,397 38,447,892 39,937,351 71,337,405 (31,400,054) $ 84,441,527 $ 85,471,185 $ 92,452,019 $__6,980,834 See Notes to Financial Statements 29 CITY OF LA QUINTA BUDGETARY COMPARISON STATEMENT LOW/MODERATE INCOME HOUSING PA NO. 2 YEAR ENDED JUNE 30, 2008 Variance with Final Budget Budget Amounts Actual Positive Original Final Amounts Nealive Budgetary Fund Balance, July 1 $ 10,076,956 $10,076,956 $ 10,076,956 $ Resources (Inflows): Taxes 5,563,900 5,701,660 5,771,938 70,278 Use of money and property 13,436,401 752,687 853,823 101,136 Other - 127,200 115,417 (11,783) Transfers from other funds - 9,378,966 9,378,966 Amounts Available for Appropriation $ 29,077,257 $ 26,037,469 $ 26,197,100 $ 159,631 Charges to Appropriation (Outflow): Planning and development $ 997,669 $ 5,966,854 $ 5,302,598 $ 664,256 Transfers to other funds 1,955,846 6,865,944 4,380,828 2,485,116 Total Charges to Appropriations 2,953,515 12,832,798 9,683,426 3,149,372 Budgetary Fund Balance, June 30 $ 26,123,742 $13,204,671 $ 16,513,674 $ 3,309,003 See Notes to Financial Statements 30 CITY OF LA QUINTA STATEMENT OF NET ASSETS PROPRIETARY FUNDS JUNE 30, 2008 Assets: Current: Cash and investments Receivables: Accounts Accrued interest Prepaid costs Inventories Deposit 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 Deposits payable Unearned revenue Total Current Liabilities Noncurrent: Advances from other funds Compensated absences Capital leases payable 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 31 Business -Type Activities - Enterprise Funds Governmental Activities - Golf Internal Course Service Funds $ 169,001 $ 4,527,594 12,090 488 18,489 1,865 - 64,041 250,000 497,485 4,546,083 43,459,062 16, 567, 065 43,459,062 16, 567,065 $ 43,956,547 $ 21,113,148 $ 151,711 $ 25,267 1,757 2,331 37,000 - 1,266 191,734 27,598 3,415,275 - - 3,928 681,047 - 4,096,322 3,928 42, 778,015 16,567,065 (3,109,524) 4,514,557 39,668,491 21,081,622 $ 43,956,547 $ 21,113,148 CITY OF LA QUINTA STATEMENT OF REVENUES, EXPENSES AND CHANGES IN FUND NET ASSETS PROPRIETARY FUNDS YEAR ENDED JUNE 30, 2008 Operating Revenues: Sales and service charges Total Operating Revenues Operating Expenses: Salaries and benefits Fuel and oil Maintenance and parts Contract services Software and supplies Depreciation Other Total Operating Expenses Operating Income (Loss) Non-operating Revenues (Expenses): Interest revenue Interest expense Gain (loss) on disposal of capital assets Total Non-operating Revenues(Expenses) Income (Loss) Before Contributions and Transfers Capital contributions Transfers out Changes in Net Assets Net Assets: Beginning of Year Changes in Net Assets End of Fiscal Year See Notes to Financial Statements 32 Business -Type Activities - Enterprise Golf Governmental Activities - Internal Service Funds $ 3,814,233 $ 1,507,101 3,814,233 1,507,101 73,845 97,953 - 94,687 126,622 3,797,186 84,679 126,002 698,582 763,791 64,536 61,598 4,634,149 1,355,332 (819,916) 151,769 4,310 213,505 (127,432) - (47,721) 5,985 (170,843) 219,490 (990,759) 371,259 352,687 517,464 - (1,262,074) (638,072) (373,351) 40,306,563 21,454,973 (638,072) (373,351) $ 39,668,491 $ 21,081,622 CITY OF LA QUINTA STATEMENT OF CASH FLOWS PROPRIETARY FUNDS YEAR ENDED JUNE 30, 2008 Cash Flows from Operating Activities: Cash received from customers and users Cash received from/(paid to) interfund service provided Cash paid to supplies for goods and services Cash paid to employees for services Net Cash Provided (Used) by Operating Activities Cash Flows from Non -Capital Financing Activities: Transfers out 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 Insurance proceeds 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 See Notes to Financial Statements 33 Business -Type Activities - Enterprise Golf Governmental Activities - Internal Service Funds $ 3,866,771 $ 1,507,101 (2,260) - (4,065,894) (494,718) (73,499) (97,590) (274,882) 914,793 (1,262,074) 865,985 (1,262,074) (75,031) (404, 574) (44,148) (327,033) 2,100 (523,753) (317,093) 4,074 216,674 4,074 216.674 71,424 (447,700) 97,577 4,975,294 $ 169,001 $ 4,527,594 CITY OF LA QUINTA STATEMENT OF CASH FLOWS PROPRIETARY FUNDS YEAR ENDED JUNE 30, 2008 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 deposits receivable (Increase) decrease in inventories (Increase) decrease in due from other governments 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 Increase of assets/liabilities resulting from the initiation of a capital lease See Notes to Financial Statements 34 Business -Type Activities - Enterprise Funds Golf Course Governmental Activities - Internal Service Funds $ (819,916) $ 151,769 698,582 763,791 18,810 - - 330 1,151 226 - (183,185) (1,461) 345 604 12,000 - (2,895) (240) 545,034 763,024 $ (274,882) $ 914,793 $ 352,687 $ 517,464 259,774 CITY OF LA QUINTA STATEMENT OF FIDUCIARY NET ASSETS FIDUCIARY FUNDS JUNE 30, 2008 Assets: Cash and investments Receivables: Taxes Interest Total Assets Liabilities: Deposits Total Liabilities See Notes to Financial Statements 35 Agency Funds $ 609,164 22,322 2,249 $ 633,735 $ 633.735 $ 633,735 THIS PAGE INTENTIONALLY LEFT BLANK 36 CITY OF LA QUINTA NOTES TO FINANCIAL STATEMENTS JUNE 30, 2008 I. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Note 1: Summary of Significant Accounting Policies a. Reporting Entity The City of La Quinta ("the 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. Separate financial statements of the Agency can be obtained at City Hall. 37 City of La Quinta Notes to Financial Statements (Continued) Note 1: Summary of Significant Accounting Policies (Continued) City of La Quinta Public Financing Authority The La Quinta Public Financing Authority (Authority) was established pursuant to a Joint Exercise of Powers Agreement dated November 19, 1991, between the City of La Quinta and the La Quinta Redevelopment Agency. The purpose of the Authority is to provide financing necessary for the construction of various public improvements through the issuance of debt. Although the 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 Authority. Separate financial statements of the 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 pronouncements, as well as the FASB Statements and Interpretations, APB Opinions, and Accounting Research Bulletins that were issued on or before November 30, 1989, that does not conflict with or contradict GASB pronouncements. Government -wide Financial Statements The government -wide financial statements (i.e., the statement of net assets and the statement of activities) report information on all of the nonfiduciary activities of the primary government and its component units. For the most part, the effect of interfund activity has been removed from these statements. Governmental activities, which normally are supported by taxes and intergovernmental revenues, are reported separately from business -type activities, which rely to a significant extent on fees and charges for support. The statement of activities demonstrates the degree to which the direct expenses of a given function or segment are offset by program revenues. Direct expenses are those that are clearly identifiable with a specific function or segment. Program revenues include 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 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 expenditure. Proceeds of long-term debt are recorded as a liability in the government -wide financial statements, rather than as other financing source. Amounts paid to reduce long-term indebtedness of the reporting government are reported as a reduction of the related liability, rather than as expenditure. 38 City of La quinta Notes to Financial Statements (Continued) Note 1: Summary of Significant Accounting Policies (Continued) 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 The government -wide financial statements are reported using the economic resources measurement focus and the accrual basis of accounting, as are the proprietary fund and fiduciary fund financial statements. Revenues are recorded when earned and expenses are recorded when a liability is incurred, regardless of the timing of related cash flows. Property taxes are recognized as revenues in the year for which they are levied. Grants and similar items are recognized as revenue as soon as all eligibility requirements imposed by the provider have been met. Governmental 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 accured for the reporting period. The City uses a 60 day availability period, except for state gas tax which is 90 days. 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 non-exchange 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. Government -mandated and voluntary non-exchange transactions are recognized as revenues when all applicable eligibility requirements have been met. KE City of La Quinta Notes to Financial Statements (Continued) Note 1: Summary of Significant Accounting Policies (Continued) 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. Non-current 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. 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. 40 City of La Quinta Notes to Financial Statements (Continued) Note 1: Summary of Significant Accounting Policies (Continued) 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 City's fiduciary funds are agency funds. Agency funds are custodial in nature. Assets equal liabilities. Agency funds are presented using the accrual basis of accounting. 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. Low / Moderate Income Housina — Proiect 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 Improvement Fund — This capital projects fund is used to account for the planning, design and construction of various capital projects throughout the City of La Quinta and the La Quinta Redevelopment Agency. Redevelopment Agency Proiect Area No. 1 — Capital Project Fund — To account for the bond proceeds, interest and other funding that will be used for development, planning, construction and land acquisition. 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 Proiect 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. 41 City of La Quinta Notes to Financial Statements (Continued) Note 1: Summary of Significant Accounting Policies (Continued) 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. Agency Funds: These funds account for assets held by the City as an agency for assessment district bondholders. 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. 42 City of La Quinta Notes to Financial Statements (Continued) Note 1: Summary of Significant Accounting Policies (Continued) 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. 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. 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 depreciations 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. 43 City of La Quinta Notes to Financial Statements (Continued) Note 1: Summary of Significant Accounting Policies (Continued) Fund Balance In the fund financial statements, governmental funds report reservations of fund balance for amounts that are not available for appropriation or are legally restricted by outside parties for use for a specific purpose. 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 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. 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 a reservation of 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). b. At June 30, 2008, the following funds had deficit fund balances: Major Capital Projects Funds Civic Center $ (9,393,000) Major Debt Service Funds: Redevelopment Agency PA No. 2 (4,455,247) Nonmajor Capital Projects Funds Library (1,084,327) RCTC (318,391) Parks and Recreation (1,513,574) Library Development (1,949,006) Fire Facility (939,634) 44 City of La Quinta Notes to Financial Statements (Continued) Note 2: Stewardship, Compliance and Accountability (Continued) c. Excess of expenditures over appropriations are as follows: Expenditures for the year ended June 30, 2008, exceeded the appropriations of the General Fund and major special revenue funds as follows: Budget Actual Variance General Fund: $ 155,927,887 Cash with fiscal agent 40,831,407 General Government Cash and investments 609,164 Fiscal services $ 830,776 $ 849,270 $ (18,494) City Manager 610,272 645,374 (35,102) Capital outlay - 37,616,690 (37,616,690) Public Safety Building & safety admin 296,792 338,040 (41,248) Building 1,039,818 1,154,461 (114,643) Public Works Construction management 680,904 1,333,130 (652,226) Variance relates to capital assets related to Highway 111 that were contributed to the City by CalTrans. III. DETAILED NOTES ON ALL FUNDS Note 3: Cash and Investments Cash and investments as of June 30, 2008, are classified in the accompanying financial statements as follows: Statement of Net Assets: Cash and investments $ 155,927,887 Cash with fiscal agent 40,831,407 Statement of Fiduciary Net Assets: Cash and investments 609,164 Total cash and investments $ 197,368,458 Cash and investments as of June 30, 2008, consist of the following. Cash on hand $ 1,250 Deposits with financial institutions (1,533,145) Investments 198,900,353 Total cash and investments $ 197,368,458 45 City of La Quinta Notes to Financial Statements (Continued) Note 3: Cash and Investments (Continued) Investments Authorized by the California Government Code and the Entity's Investment Policy 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. *Maximum *Maximum Investment Investment Types *Maximum Percentage of In One Authorized by State Law Maturity Portfolio Issuer U.S. Treasury Obligations 5 years None None U.S. Agency Securities 3 years None $20 million Commercial Paper 90 days 15% $5 million Certificates of Deposit 3 years 60% None Medium -Term Notes 3 years 10% $5 million Money Market Mutual Funds 60 days 60% 10% Local Agency Investment Fund (LAIF) N/A 25% $40 million Investment Agreements N/A N/A N/A * Based on state law requirements or investment policy requirements, whichever is more restrictive Investments Authorized by Debt Agreements Investments of debt proceeds held by bond trustee are governed by provisions of the debt agreements, rather than the general provisions of the California Government Code or the City's investment policy. The table below identifies the investment types that are authorized for investments held by bond trustee. The table also identifies certain provisions of these debt agreements that address interest rate risk, credit risk, and concentration of credit risk. Maximum Maximum Percentage Authorized Investment Type Maturity Allowed U.S. Treasury Obligations None None U.S. Agency Securities None None Banker's Acceptance 360 days None Commercial Paper 270 days None Money Market Mutual Funds N/A None Negotiable Certificates of Deposit 360 days None 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. 46 City of La Quinta Notes to Financial Statements (Continued) Note 3: Cash and Investments (Continued) 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: Investment Type U.S. Treasury bills Federal agency securities: Federal Home Loan Mortgage Corp Federal Home Loan Bank Federal Farm Credit Bank Commercial paper Medium term notes State investment pool Held by bond trustee: Money market funds U.S. Treasury bills Total $ 198,900,353 $ 122,447,093 $ 64,084,756 $ 10,387,992 $ 1,980,512 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 Moody's, respectively; medium term notes that are rated "AA" or higher by 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, 2008, 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 commercial paper were all rated A-1 and P-1 or higher from S&P and Moody's. The City's investments in medium term notes were all rated AA or better by S&P. The City's investments in money market mutual funds and federal agency securities were all rated "AAA" by S&P and Moody's. As of June 30, 2008, 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 (limited to a face value of $20 million) and Commercial Paper and Medium -Term Notes (limited to a face value of $5 million). As of June 30, 2008, the following are investments in any one issuer (other than U.S. Treasury securities, mutual funds, and external investment pools) that represent 5% or more of total City investments. Federal Home Loan Mortgage Corp. 10.00% Federal Home Loan Bank 10.06% Federal Farm Credit Bank 9.96% 47 Remaimrig Makirit (ire Months) 3 Months 4 to 6 "13 to IB Total or Less Months 7 to 12 Months Months $ 13,958,686 $ 13,958,686 $ - $ - $ 19,883,579 9,982,785 7,428,655 2,472,139 20,016,078 20,016,078 19,812,974 4,996,343 9,905,130 4,911,501 27,900,184 27,900,184 - - 7,971,357 - 2,986,493 3,004,352 1,980,512 48,525,976 48,525,976 - - 12,104,440 12,104,440 - - 28,727,079 4,978,679 23,748,400 - $ 198,900,353 $ 122,447,093 $ 64,084,756 $ 10,387,992 $ 1,980,512 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 Moody's, respectively; medium term notes that are rated "AA" or higher by 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, 2008, 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 commercial paper were all rated A-1 and P-1 or higher from S&P and Moody's. The City's investments in medium term notes were all rated AA or better by S&P. The City's investments in money market mutual funds and federal agency securities were all rated "AAA" by S&P and Moody's. As of June 30, 2008, 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 (limited to a face value of $20 million) and Commercial Paper and Medium -Term Notes (limited to a face value of $5 million). As of June 30, 2008, the following are investments in any one issuer (other than U.S. Treasury securities, mutual funds, and external investment pools) that represent 5% or more of total City investments. Federal Home Loan Mortgage Corp. 10.00% Federal Home Loan Bank 10.06% Federal Farm Credit Bank 9.96% 47 City of La Quinta Notes to Financial Statements (Continued) Note 3: Cash and Investments (Continued) 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. Investment in State Investment Pool The Entity 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 LAW for the entire LAIF 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. 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 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 sixty 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 48 City of La Quinta Notes to Financial Statements (Continued) Note 4: Property Taxes (Continued) The La Quinta Redevelopment Agency's primary source of revenue comes from property taxes. Property taxes allocated to the Agency are computed in the following manner: a) The assessed valuation of all property within the project area is determined on the, date of adoption of the Redevelopment Plan. b) Property taxes related to the incremental increase in assessed values after the adoption of the Redevelopment Plan are allocated to the Agency; all taxes on the "frozen" assessed valuation of the property are allocated to the City and other districts. The Agency has no power to levy and collect taxes and any legislative property tax shift might reduce the amount of tax revenues that would otherwise be available to pay the principal of, and interest on, debt. Broadened property tax exemptions could have a similar effect. Conversely, an increase in the tax rate or assessed valuation, or any reduction or elimination of present exemptions would increase the amount of tax revenues that would be available to pay principal and interest on debt. Note 5: Notes Receivable In September 1994, the Redevelopment 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. In December 2000, the Redevelopment Agency entered into an agreement with LINC Housing to receive $9,500,000 as a reimbursement for Agency costs incurred for the construction of infrastructure related to the development of senior apartments. Payments are due to the Agency based on annual positive cash flow generated by the rental of the units. All unpaid principal and interest on the note are due fifty-five years after the completion of the project. Interest on the note accrues at 3% per annum. Other notes receivable Total notes receivable balance at June 30, 2008 49 Outstanding Balance at June 30, 2008 $ 3,641,983 9,443,802 40,675 $ 13,126,460 City of La Quinta Notes to Financial Statements (Continued) Note 6: Capital Assets Capital asset activity for governmental activities for the year ended June 30, 2008, is as follows: (*) Relates to transfers between Governmental activities and Business -Type activities. Depreciation expense was charged to the following functions in the Statement of Activities. General government $ 87,134 Public safety 826,355 Planning and development 16,666 Community services 845,037 Public works 4,554,252 Total governmental activities $ 6,329,444 Beginning Ending Balance at Balance at July 1, 2007 Additions Deletions Transfers June 30, 2008 Governmental Activities: Capital assets, not being depreciated. Land $ 75,077,785 $ 5,988,776 $ 68,000 $ (352,687) $ 80,645,874 Right of way 260,717,812 21,958,614 - - 282,676,426 Construction -in -progress 42,6('52_,144 45,456,601 26,841,354 (21,578,184) 39,699,207 Total Capital Assets, Not Being Depreciated 378,457,741 73,403,991 26,909,354 (21,9300,871) 403,021,507 Capital assets, being depreciated: Buildings and improvements 37,263,921 158,939 65,082 17,769,935 55,127,713 Equipment and furniture 2,046,095 315,336 377,826 - 1,983,605 Vehicles 1,366,729 302,315 84,326 - 1,584,718 Infrastructure 130,193,911 18,728,146 909,097 3,808,249 151, 821,209 Total Capital Assets, Being Depreciated 170, 870,656 19,504, 736 1,436, 331 21, 578,184 210, 517,245 Less accumulated depredation Buildings and improvements 9,230,538 1,578,325 36,648 - 10,772,215 Equipment and furniture 1,290,670 139,342 359,937 1,070,075 Vehicles 844,442 168,335 83,993 928,784 Infrastructure 60,149,383 4,443,442 755,063 63,837.762 Total Accumulated Depredation 71,515,033 6,329,444 1,235,641 - 76,608,836 Total Capital Assets, Being Depreciated, Net 99,355,623 13,175,292 200,690 21,578,184 133,908,409 Governmental Activities Capital Assets, Net $ 477,813,364 $ 86,579,283 $ 27,110,044 $ (352,687) * $ 536,929,916 (*) Relates to transfers between Governmental activities and Business -Type activities. Depreciation expense was charged to the following functions in the Statement of Activities. General government $ 87,134 Public safety 826,355 Planning and development 16,666 Community services 845,037 Public works 4,554,252 Total governmental activities $ 6,329,444 City of La Quinta Notes to Financial Statements (Continued) Note 6: Capital Assets (Continued) Capital asset activity for business -type activities for the year ended June 30, 2008, is as follows: Business -Type Activities: Capital assets, not being depreciated: Land Total Capital Assets, Not Being Depreciated Capital assets, being depreciated: Buildings and improvements Equipment and furniture Vehicles Software Total Capital Assets, Being Depredated Less accumulated depreciation: Buildings and improvements Equipment and furniture Vehicles Software Total Accumulated Depredation Total Capital Assets, Being Depredated, Net Governmental Activities Capital Assets, Net Beginning Ending Balance at Balance at July 1, 2007 Additions Deletions Transfers June 30, 2008 $ 36,458,147 $ 29,998 $ $ 352,687 $ 36,840,832 36,458,147 29,998 352,687 36,840,832 6,591,432 45,033 6,636,465 1,770,849 259,774 251,475 1,779,148 20,348 - - 20,348 20,255 - 20,255 8,402, 884 304,807 251.475 8,456,216 569,728 233,804 - 803,532 753,130 456,657 203,754 1,006,033 10,173 4,070 - 14,243 10,127 4,051 - 14,178 1,343,158 698,582 203,754 1.837,986 7,059, 726 (393,775) 47,721 6,618,230 $ 43,517, 873 $ (363,777) $ 47,721 $ 352,687 " $ 43,459,062 (") Relates to transfers between Governmental activities and Business -Type activities. Depreciation expense was charged to the following function in the Statement of Activities: Golf Course 51 City of La Quinta Notes to Financial Statements (Continued) 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, 2008: City: Compensated absences payable Due to the Coachella Valley Association of Governments Developer Agreement Payable Copier Lease Payable Redevelopment Agency: RDA Project Area No. 1: Tax allocation bonds Pass-through agreements payable. - Coachella Valley Unified School District RDA Project Area No. 2: Tax allocation bonds Due to County of Riverside Financing Authority: Revenue bonds Tota I Beginning Balance at July 1, 2007 Additions Balance at June Due within one Deletions 30, 2008 year $ 734,054 $ 921,291 $ 822,190 $ 833,155 $ 833,155 278,311 50,000 228,311 50,000 643,539 - 143,753 499,786 155,972 - 182,094 - 182,094 32,925 139,145, 000 4,431,179 6,025,000 1,750,000 2,795,000 136,350,000 2,960,000 770,558 3,660,621 785,968 110,000 5,915,000 115,000 150,000 1,600,000 200,000 93,645,000 1,930,000 91,715,000 1,995,000 $ 246,652,083 $ 1,103,385 $ 6,771,501 240,983,967 $ 7,128,020 Less: Unamortized premiums/discounts (841,087) Net Long -Term Debt $ 240,142,880 For the governmental activities, accrued employee benefits are generally liquidated by the general fund. b. A description of individual issues of debt (excluding defeased bonds) outstanding as of June 30, 2008, is as follows: Due to the Coachella Valley Association of the Governments The City of La Quinta entered into an Interchange Reimbursement Agreement with the Coachella Valley Association of Governments (CVAG) to finance capital improvements at the Washington Street 1-10 interchange. The City has agreed to reimburse CVAG $828,311 over a period of seventeen years beginning July 31, 1996. The annual payments to CVAG range from $28,311 to $50,000. At June 30, 2008, the balance payable was $228,311. 52 City of La Quinta Notes to Financial Statements (Continued) Note 7: Changes in Long -Term Liabilities — Governmental Activities (Continued) The minimum annual requirements to amortize the payable to Coachella Valley Association of Governments as of June 30, 2008, are as follows: Totals $ 228,311 Developer Agreement Payable In December 1998, the City entered into a tax sharing agreement with Stamko Development Co_ in relation to the development of an auto mall located within the City. For a period of ten years, the agreement requires the City to make quarterly payments to the developer in the amount of 33% of the sales and use tax revenues generated by the site up to a maximum amount of $122,250 in any twelve month period. Additionally, if the sales and use tax revenues generated exceed $530,000, adjusted annually by the CPI index, the City is required to pay $76,204 for that year for a maximum of ten years, based upon a $500,000 note at an interest rate of 8.5%. For the year ended June 30, 2008, the City paid the developer $122,250 in sales tax reimbursement and $21,503 since the sales tax generated exceeded the required amount. The balance at June 30, 2008, is $499,786. The minimum annual requirements to amortize the developer agreement payable as of June 30, 2008, are as follows: Principal Interest 2008-2009 $ 155,972 $ 42,482 2009-2010 169,230 29,224 2010-2011 174,584 23,870 Totals $ 499,786 $ 95,576 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 Principal 2008-2009 $ 50,000 2009-2010 50,000 2010-2011 50,000 2011-2012 50,000 2012-2013 28,311 Totals $ 228,311 Developer Agreement Payable In December 1998, the City entered into a tax sharing agreement with Stamko Development Co_ in relation to the development of an auto mall located within the City. For a period of ten years, the agreement requires the City to make quarterly payments to the developer in the amount of 33% of the sales and use tax revenues generated by the site up to a maximum amount of $122,250 in any twelve month period. Additionally, if the sales and use tax revenues generated exceed $530,000, adjusted annually by the CPI index, the City is required to pay $76,204 for that year for a maximum of ten years, based upon a $500,000 note at an interest rate of 8.5%. For the year ended June 30, 2008, the City paid the developer $122,250 in sales tax reimbursement and $21,503 since the sales tax generated exceeded the required amount. The balance at June 30, 2008, is $499,786. The minimum annual requirements to amortize the developer agreement payable as of June 30, 2008, are as follows: Principal Interest 2008-2009 $ 155,972 $ 42,482 2009-2010 169,230 29,224 2010-2011 174,584 23,870 Totals $ 499,786 $ 95,576 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 City of La Quinta Notes to Financial Statements (Continued) 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, 2008 are as follows: Year Ending June 30, Tota I 2009 $ 44,358 2010 44,358 2011 44,358 2012 44,358 2013 44,358 Total Payments $ 221,790 Less Amount Representing Interest (39,696) 264,443 Outstanding Principal $ 182,094 Tax Allocation Bonds As of June 30, 2008, 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 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. 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, 2008, is $10,785,000. The minimum annual requirements to amortize the bond payable as of June 30, 2008, are as follows: $ 10,785,000 $ 2,078,859 54 Principal Interest 2008-2009 $ 1,865,000 $ 719,233 2009-2010 2,000,000 578,160 2010-2011 2,145,000 426,868 2011 -2012 2,305,000 264,443 2012-2013 2,470,000 90,155 $ 10,785,000 $ 2,078,859 54 City of La Quinta Notes to Financial Statements (Continued) Note 7: Changes in Long -Term Liabilities — Governmental Activities (Continued) Series 1998, Proiect 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 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, 2008, is $15,760,000. The minimum annual requirements to amortize the bond payable as of June 30, 2008, are as follows: Totals $ 15,760,000 $ 11,525,280 Series 1998, Proiect Area No. 2 Tax allocation refunding bonds, Series 1998, in the amount of $6,750,000 were issued by the 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 price equal to the principal amount thereof plus accrued interest. 55 Principal Interest 2008-2009 $ _$__816,5_20 2009-2010 819,520 2010-2011 819,520 2011 -2012 819,520 2012-2013 - 819,520 2013-2018 3,635,000 3,644,030 2018-2023 4,690,000 2,567,500 2023-2028 6,035,000 1,179, 750 2028-2033 1,400,000 36,400 Totals $ 15,760,000 $ 11,525,280 Series 1998, Proiect Area No. 2 Tax allocation refunding bonds, Series 1998, in the amount of $6,750,000 were issued by the 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 price equal to the principal amount thereof plus accrued interest. 55 City of La Quinta Notes to Financial Statements (Continued) Note 7: Changes in Long -Term Liabilities — Governmental Activities (Continued) 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 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, 2008, is $86,175,000 with an unamortized premium of $146,211. The minimum annual requirements to amortize the bond payable as of June 30, 2008, are as follows: Totals $ 86,175,000 $ 72,246,629 Note 8: Changes in Long -Term Liabilities — Business -type Activities Changes in business -type long-term liabilities for the year ended June 30, 2008, were as follows: Balance at Balance at Due within July 1, 2007 Additions Deletions July 1, 2008 one year Golf Course: Capital leases payable $ 825,848 $ 259,774 $ 404,575 $ 681,047 $ 395,831 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. .ol Principal Interest 2008-2009 _ $ 1,615,000 $ 4,304,994 2009-2010 1,670,000 4,243,331 2010-2011 1,740,000 4,175,131 2011 -2012 1,805,000 4,099,719 2012-2013 1,890,000 4,016,581 2013-2018 10,925,000 18,533,713 2018-2023 14,090,000 15,279,906 2023-2028 18,165,000 11,107,313 2028-2033 23,235,000 5,912,966 2033-2038 11,040,000 572,975 Totals $ 86,175,000 $ 72,246,629 Note 8: Changes in Long -Term Liabilities — Business -type Activities Changes in business -type long-term liabilities for the year ended June 30, 2008, were as follows: Balance at Balance at Due within July 1, 2007 Additions Deletions July 1, 2008 one year Golf Course: Capital leases payable $ 825,848 $ 259,774 $ 404,575 $ 681,047 $ 395,831 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. .ol City of La Quinta Notes to Financial Statements (Continued) Note 8: Changes in Long -Term Liabilities — Business -type Activities (Continued) Obligations under capital leases are as follows: National City Golf Finance The present value of the minimum lease payment on golf carts was capitalized at using an incremental borrowing rate of 6.50% at the inception of the lease. The lease is payable in 36 monthly installments of $7,962 which began February 1, 2008. $ 226,643 The present value of the minimum lease payment on golf equipment was capitalized at $273,642 using an incremental borrowing interest rate of 9.68% at the inception of the lease. The lease is payable in 60 monthly installments of $5,771, which began May 1, 2005. 96,331 The present value of the minimum lease payment on golf equipment was capitalized at $543,118 using an incremental borrowing interest rate of 9.0% at the inception of the lease. The lease is payable in 60 monthly installments of $9,318, which began January 1, 2005. 166,236 The present value of the minimum lease payment on golf equipment was capitalized at $50,911 using an incremental borrowing interest rate of 8.0% at the inception of the lease. The lease is payable in 48 monthly installments of $1,243, which began November 28, 2004. 4,890 The present value of the minimum lease payment on golf carts was capitalized at $26,674 using an incremental borrowing interest rate of 7.0% at the inception of the lease. The lease is payable in 36 monthly installments of $824, which began February 1, 2006. 5,633 The present value of the minimum lease payment on lawn equipment was capitalized at $90,554 using an incremental borrowing interest rate of 6.99% at the inception of the lease. The lease is payable in 36 monthly installments of $2,796, which began October 1, 2006. 40,043 The present value of the minimum lease payment on golf equipment was capitalized at $21,569 using an incremental borrowing interest rate of 7.5% at the inception of the lease. The lease is payable in 48 monthly installments of $522, which began December 1, 2005. 8,386 VGM Financial Services The present value of the minimum lease payment on software was capitalized at $63,525 using an incremental borrowing interest rate of 10.74% at the inception of the lease. The lease is payable in 60 monthly installments of $1,373, which began April 1, 2005. 22,731 TFG-California, L.P. The present value of the minimum lease payment on a GPS system was capitalized at $284,650 using an incremental borrowing interest rate of 7.3% at the inception of the lease. The lease is payable in 48 monthly installments of $6,840, which began November 11, 2005. 11 n 154 Total capital leases payable as of June 30, 2008 $ 681,047 61 City of La Quinta Notes to Financial Statements (Continued) Note 8: Changes in Long -Term Liabilities — Business -type Activities (Continued) The following schedule summarizes the debt to maturity payments for capital leases: Principal Interest 2008-2009 $ 395,831 $ 30,497 2009-2010 230,674 8,992 2010-2011 54,542 1,188 Total $ 681,047 $ 40,677 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 liabilitys 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, 2008: Amount Outstanding at Proceeds Maturity Date Interest Rate June 30, 2008 Assessment District No. 97-1 $ 705,262 9/2/2018 4.10% - 5.20% $ 460,000 Assessment District No. 2001-1 2,285,000 9/2/2015 5.00% - 6.60% 1,120,000 Note 10: Conduit Debt Financing 2002 Series B Multifamily Housing Revenue Bonds In April 2002, the La Quinta Redevelopment 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 5.5% per annum. Outstanding bonds at June 30, 2008, are $2,880,000. 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. Note 11: Interfund Receivables and Payables The composition of current interfund receivable and payable as of June 30, 2008, are as follows: Due to Other Funds Non -Major Governmental TOTAL Due From Other Funds General Fund $ 19,414 $ 19,414 RDA PA #2 Debt Service 5,684,047 5,684,047 Non -Major 312,000 312,000 Total: $ 6,015,461 $ 6,015,461 62 City of La Quinta Notes to Financial Statements (Continued) Note 11: Interfund Receivables and Payables (Continued) The due to the General Fund and RDA PA#2 Debt Service Fund were the results of routine interfund transactions not cleared prior to year-end. The composition of non-current interfund receivable and payable as of June 30, 2008, are as follows: Advances From Other Funds a) As of June 30, 2008, the amount due to the General Fund from RDA PA No. 1 Debt Service was $12,000,000. This consists of an outstanding advance of $6,000,000 loaned to the Redevelopment Agency with repayment beginning in 2030/31 and accrued interest at 10% per annum. The other outstanding advance of $6,000,000 loaned to the Redevelopment Agency requires repayments beginning in 2030/31 and accrues interest at 7% per annum. b) As of June 30, 2008, the amount due to the General Fund from RDA PA No. 2 Debt Service was $19,378,966. This consists of a $10,000,000 advance loaned to the Redevelopment Agency with repayment beginning in 2035/36 and accrued interest at 10% per annum and a .$9,378,966 advance loaned to the Redevelopment Agency accruing interest at 7% on December 4, 2007, with an anticipated repayment date of 2018/2019. c) As of June 30, 2008, the General Fund has advanced to the Golf Course fund $3,415,275. The advances accrue interest at the City's investment pool rate and are to be repaid by the golf course out of future profits. d) In July 2002, an advance of $4,167,912 was made 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, 2008, the remaining balance of the advance for the La Quinta Community Park is $1,513,574. e) In April 2005, another advance of $2,490,273 was made 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, 2008, is $1,949,005. f) 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 the development of the City's north fire station. The advance accrues interest equal to the earning rate of the City's Investment Pool Funds and is to be repaid by the year 2039. As of June 30, 2008, the remaining balance of the advances is $939,634. 63 RDA PA #1 RDA PA #2 Non -Major Civic Center Debt Service Debt Service Golf Course Governmental TOTAL Advances to Other Funds - General Fund $ 9,393,000 $ 12,000,000 $ 19,378,966 $ 3,415,275 $ 1,077,725 $ 45,264,966 Redevelopment Agency - - - - 3,462,579 3,462,579 PA No. 1 Capital Projects Non -Major Governmental - - - - 939,634 939,634 Total: $ 9,393,000 $ 12,000,000 $ 19,378,966 $ 3,415,275 $ 5,479,938 $ 49,667,179 a) As of June 30, 2008, the amount due to the General Fund from RDA PA No. 1 Debt Service was $12,000,000. This consists of an outstanding advance of $6,000,000 loaned to the Redevelopment Agency with repayment beginning in 2030/31 and accrued interest at 10% per annum. The other outstanding advance of $6,000,000 loaned to the Redevelopment Agency requires repayments beginning in 2030/31 and accrues interest at 7% per annum. b) As of June 30, 2008, the amount due to the General Fund from RDA PA No. 2 Debt Service was $19,378,966. This consists of a $10,000,000 advance loaned to the Redevelopment Agency with repayment beginning in 2035/36 and accrued interest at 10% per annum and a .$9,378,966 advance loaned to the Redevelopment Agency accruing interest at 7% on December 4, 2007, with an anticipated repayment date of 2018/2019. c) As of June 30, 2008, the General Fund has advanced to the Golf Course fund $3,415,275. The advances accrue interest at the City's investment pool rate and are to be repaid by the golf course out of future profits. d) In July 2002, an advance of $4,167,912 was made 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, 2008, the remaining balance of the advance for the La Quinta Community Park is $1,513,574. e) In April 2005, another advance of $2,490,273 was made 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, 2008, is $1,949,005. f) 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 the development of the City's north fire station. The advance accrues interest equal to the earning rate of the City's Investment Pool Funds and is to be repaid by the year 2039. As of June 30, 2008, the remaining balance of the advances is $939,634. 63 City of La Quinta Notes to Financial Statements (Continued) Note 11: Interfund Receivables and Payables (Continued) g) 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, 2008, the Civic Center expansion was completed and the amount of the advance was $9,393,000 outstanding. The advance accrues interest that would have been earned by the Local Agency Investment Fund. Note 12: Interfund Transfers TRANSFERSIN General Fund Low/Moderate Income Housing PA #2 Capital Improvement RDA PA #1 Capital Projects RDA PA #1 Debt Service RDA PA #2 Debt Service Non -Major Governmental Tolat: TRANSFERS OUT LowlModerafe RDA PA #1 General Income Housing Capital Capital RDA PA #1 RDA PA #2 Non -Major Internal Fund PA #2 Improvement Projects Civic Center Debt Service Deb(Service Governmental Service Funds TOTAL $ 313,134 $ - $ 313,134 9,378,966 9,378,966 810,135 2,111,626 3,623,184 6,240,662 - 26,576,548 1,262,074 40,624,429 25,000,000 160,355 25,180,355 - - 4,557,990 4,557,990 1,955,846 - - 1,955,846 2,000 313,156 40,000 3,970,960 1,955,846 312,000 6,593,962 $ 812,135 $ 4,380,828 $ 40,000 $ 3,623,184 $ 6,240,662 $ 28,970,960 $ 11,334,812 3 31,940,027 $ 1,262,074 $ 88,604,682 The following describes the major transfers in and transfers out included in the financial statements: a) $4,557,990 was transferred from the Low/Moderate Housing Project Area No. 1 Fund to the RDA Project Area No.1 Debt Service Fund to pay a portion of the 2004 Series A Local Agency Revenue Bond debt service. b) $2,053,345 was transferred from the Low/Moderate Housing Project Area No. 2 Fund to the Capital Improvement Fund to pay for various capital projects. $1,955,845 was transferred from the Low/Moderate Housing Project Area No. 2 Fund to the RDA Project Area No. 2 Debt Service Fund to pay a portion of the 2004 Series A Local Agency Revenue Bond debt service. c) $3,970,961 and $1,955,845 was transferred from the RDA Project Area No. 1 and 2 Debt Service Funds, respectively, to the Financing Authority Debt Service Fund to pay a portion of the 2004 Series A Local Agency Revenue Bond debt service. $25,000,000 was transferred from RDA Project Area No. 1 Debt Service Funds to the RDA Capital Projects — PA No. 1 Fund to fund various capital projects within the Project Area. d) $3,623,184 was transferred to the Capital Improvement Fund from the RDA Capital Projects — PA No. 1 Fund to fund various capital projects throughout the City. e) $21,294,034 was transferred to the Capital Improvement Fund from the RDA 2004 Low/Mod Bond Fund for various capital projects funded by bond proceeds. f) The Library Fund transferred to the Capital Improvement Fund $2,821,281 to fund Library Phase 2 and museum expansion project costs. g) $6,240,662 was transferred to the Capital Improvement Fund from the Civic Center Fund to pay for the Civic Center expansion project. 64 City of La Quinta Notes to Financial Statements (Continued) 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. Funding 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 12.744% of annual covered payroll. The contribution requirements of plan members and the City are established and may be amended by PERS. Annual Pension Cost For 2008, the City's annual pension cost of $902,098 for PERS was equal to the City's required and actual contributions. Three -Year Trend Information for PERS Required Percentage Fiscal Year Contributions Contributed 6/30/2006 $ 400,631 100% 6/30/2007 763,527 100% 6/30/2008 902,098 100% Note 14: Post -Employment Health Benefits The City provides health care benefits to retired employees in accordance with City MOU's. To be eligible, the employee must be at least 50 years of age and have five years of service. The amount provided by the City includes contributions ranging from $81 to $90 toward the group benefit plan for the employee and is financed on a pay-as-you-go basis. As of June 30, 2008, there were three retired employees receiving benefits. The total cost of post -employment health benefits was $3,330. Note 15: Self Insurance The City is a member of the California Joint Powers Insurance Authority (Insurance Authority). The Insurance Authority is composed of 119 California public entities and is organized under a joint powers agreement pursuant to California Government Code §6500 et 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. 65 City of La Quinta Notes to Financial Statements (Continued) Note 15: Self Insurance (Continued) Self -Insurance Programs of the Authority General Liability Each member government pays a primary deposit to cover estimated losses for a fiscal year (claims year). After the close of a fiscal year, outstanding claims are valued. A retrospective deposit computation is then made for each open claims year. Claims are pooled separately between police and non -police. Costs are spread to members as follows: The first $30,000 of each occurrence is charged directly to the member's primary deposit; costs from $30,000 to $750,000 and the loss development reserves associated with losses up to $750,000 are pooled based on the member's share of losses under $30,000. Losses from $750,000 to $5,000,000 and the associated loss development reserves are pooled based on payroll. Costs of covered claims from $5,000,000 to $50,000,000 are currently paid by excess insurance. Costs of covered claims for subsidence losses from $15,000,000 to $25,000,000 are paid by excess insurance. The protection for each member is $50,000,000 per occurrence and $50,000,000 annual aggregate. Administrative expenses are paid from the Insurance Authority's investment earnings. Workers Compensation The City also participates in the workers' compensation pool administered by the Insurance Authority. Each member pays a primary deposit to cover estimated losses for a fiscal year (claims ydar). After the close of a fiscal year, outstanding claims are valued. A retrospective deposit computation is then made for each open claims year. Claims are pooled separately between public safety and non-public safety. Each member has a retention level of $50,000 for each loss and this is charged directly to the member's primary deposit. Losses from $50,000 to $100,000 and the loss development reserve associated with losses up to $100,000 are pooled based on the member's share of losses under $50,000. Losses from $100,000 to $2,000,000 and employer's liability losses from $5,000,000 to $10,000,000 and loss development reserves associated with those losses are pooled based on payroll. Losses from $2,000,000 to $5,000,000 are pooled with California State Association of Counties — Excess Insurance Authority members. Costs from $2,000,000 to $300,000,000 are transferred to reinsurance carriers. Costs in excess of $300,000,000 are pooled among the Members based on payroll. Protection is provided per statutory liability under California Workers' Compensation law. Administrative expenses are paid from the Insurance Authority's investment earnings. 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 $36,696,000. 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 $50,689,900. 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. X. City of La Quinta Notes to Financial Statements (Continued) Note 16: Contingencies Various claims and suits have been filed against the City in the normal course of operations. Although the outcome of these lawsuits is not presently determinable, in the opinion of management, the resolution of these matters will not have a material adverse effect on the financial position of the City. Vista Dunes Court Yard Homes In October 2007, the La Quinta Redevelopment Agency entered into an agreement pursuant to which it transferred fee title to a parcel generally located at Adams Street and Miles Avenue (the "Site") improved with 80 rental apartment units (the "Housing Development') to National CORE. National CORE, in turn transferred the Site and Housing Development to a limited partnership as a requirement to enter into a 15 year tax credit bond sale. in the future, National CORE is obligated to (1) exercise its option to acquire the Site and Housing Development from the limited partnership at the close of the 15 year tax credit period, as set forth in the partnership agreement, and (2) convey fee title to the Site and Housing Development to the City, as the Agency's successor, on the 55`h anniversary of the permanent loan closing. As of the June 30, 2008, the permanent loan closing has not occurred. Note 17: Construction Commitments The following material construction commitments existed at June 30, 2008: Expenditures Contract to date as of Remaining Project Name Amount June 30, 2008 Commitments Silver Rock Resort Infrastructure $ 26,358,941 $ 954,271 $ 25,404,670 Silver Rock Resort Club House 25,412,010 690,917 24,721,093 Silver Rock Resort Entry Feature & Roads 5,594,224 74,897 5,519,327 Dune Palms Road and Ave 48 Housing 30,153,435 15,604,746 14,548,689 Community Park Land Acquisition 8,000,000 2,569 7,997,431 Adams Street Bridge Improvements 12,408,001 69,270 12,338,731 Note 18: Unreserved Fund Balances Unreserved fund balances at June 30, 2008, consisted of the following: Low/Moderate Income RDA PA No. RDA PA No- Other Housing PA 1 Capital 2 Debt Governmental General Fund No. 2 Projects Civic Center Service Funds TOTAL Designated for: Emergency reserves $19,651,824 $ $ $ $ $ $ 19,651,824 Cash flows 3,689,359 3,689,359 Capital improvements 2,100,000 2,100,000 Educational purposes - CSUSB 250,000 250,000 Economic development 1,911,131 1,911,131 Carryover appropriations 2,673,793 2,673,793 Operations/projects/transfers 16,734,016 16,734,016 Undesignated 16,512,703 39,660,439 (9,393,000) (4,455,247) 41,480,125 83,805,020 Total unreserved fund balances (deficit) $47,010,123 $ 16,512,703 $39,660,439 $(9,393,000) $ (4,455,247) $41,480,125 $ 130,815,143 67 City of La Quinta Notes to Financial Statements (Continued) 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 Gold 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, 2008, the Golf Course had an operating loss before contributions and transfers of $990,759. 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. In addition, the hotel may not assign or transfer this agreement without the City's prior written consent, which it may withhold at its discretion. The hotel opened in November 2006. As of June 30, 2008, the City made $171,679 in reimbursement payments to the owner leaving an outstanding balance of $709,470. 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, 2008, the City made $290,676 in reimbursement payments to the owner leaving an outstanding balance of $3,594,284. 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. Theses 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 serviced 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. Riverside County Transportation Commission (RCTC) Fund - To account for grant funds related to transportation projects. 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. 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. Redevelop meat A enc Low and Moderate Bond fund P.A. No. 1 and No. 2 Funds — To account for the required 20% set aside of property tax increments that is legally restricted for increasing or improving housing for low and moderate income households. Development Agreement Fund — To account for the proceeds of development agreement revenues collected and the related expenditures in accordance with State requirements. Coachella Valley Violent Crime Gang Task Force - To account for the revenues and expenditures of this valley -wide crime prevention program with funding coming from the member agencies and grant revenue. Justice Assistance Grant - To account for the revenues and expenditures of the Justice Assistance Grant Program. Proposition 1 B Fund -_To account for the revenues and expenditures related to Proposition 1 B monies. 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. 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. 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, _ Civic Center 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. Six 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. Redevelopment Agency, Capital Projects Fund Area 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. 70 THIS PAGE INTENTIONALLY LEFT BLANK 71 CITY OF LA QUINTA COMBINING BALANCE SHEET NONMAJOR GOVERNMENTAL FUNDS JUNE 30, 2008 Assets: Pooled cash and investments Receivables: Accounts Notes Accrued interest Prepaid costs Due from other governments Due from other funds Advances to other funds Restricted assets: Cash and investments with fiscal agents Total Assets Liabilities and Fund Balances: Liabilities: Accounts payable Deposits payable Deferred revenues Unearned revenue Due to other governments Due to other funds Advances from other funds Total Liabilities Fund Balances: Fund balances: Reserved: Reserved for prepaid costs Reserved for notes receivable Reserved for advances to other funds Unreserved: Undesignated Total Fund Balances Total Liabilities and Fund Balances Special Revenue Funds State Gas Federal Tax Library Assistance SLEBG $ 30,455 $ $ $ 18,981 258 - 344 247,149 13,023 3,253 $ 277,862 $ - $ 13,023 $ 22,578 6,603 - 13,023 1,077,724 1,084,327 13,023 277,862 (1,084,327) 22,578 277,862 (1,084,327) - 22,578 $ 277,862 $ - $ 13,023 $ 22,578 �a CITY OF LA QUINTA COMBINING BALANCE SHEET NONMAJOR GOVERNMENTAL FUNDS JUNE 30, 2008 (Continued) Assets: Pooled cash and investments Receivables: Accounts Notes Accrued interest Prepaid costs Due from other governments Due from other funds Advances to other funds Restricted assets: Cash and investments with fiscal agents Total Assets Liabilities and Fund Balances: Liabilities: Special Revenue Funds Lighting Indian and Gaming Landscape RCTC Quimby $ 143,288 $ $ - $ 10,300,538 671 39,380 31,704 318,391 $ 143,959 $ 31,704 $ 318,391 $ 10,339,918 Accounts payable $ $ _ $ $ Deposits payable Deferred revenues 318,391 Unearned revenue 143,959 Due to other governments Due to other funds 318,391 Advances from other funds - Total Liabilities 143,959 636,782 Fund Balances: Fund balances: Reserved: Reserved for prepaid costs Reserved for notes receivable Reserved for advances to other funds _ Unreserved: Undesignated 31,704 (318,391) 10,339,918 Total Fund Balances - 31,704 (318,391) 10,339,918 Total Liabilities and Fund Balances $ 143,959 $ 31,704 $ 318,391 $ 10,339,918 73 CITY OF LA QUINTA COMBINING BALANCE SHEET NONMAJOR GOVERNMENTAL FUNDS JUNE 30, 2008 Assets: Pooled cash and investments Receivables: Accounts Notes Accrued interest Prepaid costs Due from other governments Due from other funds Advances to other funds Restricted assets: Cash and investments with fiscal agents Total Assets Special Revenue Funds Arts in Public Public South Coast Safety Places Air Quality AB 939 $ 18,333 $ 1,082,829 $ 252,514 $ 1,426,332 70 4,145 939 5,412 $ 18,403 $ 1,086,974 $ 253,453 $ 1,431,744 Liabilities and Fund Balances: Liabilities: Accounts payable $ - $ 20,264 $ $ Deposits payable - Deferred revenues Unearned revenue Due to other governments Due to other funds Advances from other funds - Total Liabilities 20,264 Fund Balances: Fund balances: Reserved: Reserved for prepaid costs Reserved for notes receivable - Reserved for advances to other funds - Unreserved: Undesignated 18,403 1,066,710 253,453 _ 1,431,744 Total Fund Balances 18,403 1,066,710 253,453 1,431,744 Total Liabilities and Fund Balances $ 18,403 $ 1,086,974 $ 253,453 $ 1,431,744 74 CITY OF LA QUINTA COMBINING BALANCE SHEET NONMAJOR GOVERNMENTAL FUNDS JUNE 30, 2008 (Continued) Assets: Pooled cash and investments Receivables: Accounts Notes Accrued interest Prepaid costs Due from other governments Due from other funds Advances to other funds Restricted assets: Cash and investments with fiscal agents Total Assets Liabilities and Fund Balances: Liabilities: Special Revenue Funds Low/Moderate 45,055 $ CV Violent Justice Income Housing Development Crime Assistance PA No. 1 Agreement Task Force Grant $ 3,411,134 $ 193,935 $ 150,477 $ 11,165 - 191 3,682,658 - - 7,724 740 581 1,949 - - 341,447 Fund Balances: 9,337 $ 7,456,077 $ 194,675 $ 160,586 $ - Accounts payable $ 45,055 $ - $ 2,724 $ Deposits payable 14,732 194,675 - Deferred revenues 1,606,595 - Unearned revenue Due to other governments 2,834 Due to other funds - Advances from other funds _ Total Liabilities 1,669,216 194,675 2,724 Fund Balances: Fund balances: Reserved: Reserved for prepaid costs 1,949 Reserved for notes receivable 2,076,063 Reserved for advances to other funds - Unreserved: Undesignated 3,708,849 157,862 Total Fund Balances 5,786,861 - 157,862 - Total Liabilities and Fund Balances $ 7,456,077 $ 194,675 $ 160,586 $ 75 CITY OF LA QUINTA COMBINING BALANCE SHEET NONMAJOR GOVERNMENTAL FUNDS JUNE 30, 2008 Special Revenue Funds Capital Projects Funds 2004 Proposition 16 Low/Mod Liabilities and Fund Balances: Liabilities: Accounts payable $ Fund Bond Infrastructure Transportation Assets: Unearned revenue 620,469 Pooled cash and investments $ 617,674 $ $ 399,119 $ 7,862,686 Receivables: - Total Liabilities 620,469 5,684,047 - - Accounts - - - Notes - - - Accrued interest 2,795 1,301 30,713 Prepaid costs - Undesignated 18,444,271 400,420 7,893,399 Due from other governments - 18,444,271 400,420 7,893,399 Total Liabilities and Fund Balances $ 620,469 $ 24,128,318 $ 400,420 $ 7,893,399 Due from other funds Advances to other funds Restricted assets: Cash and investments with fiscal agents - 24,128,318 - - Total Assets $ 620,469 $ 24,128,318 $ 400,420 $ 7,893,399 Liabilities and Fund Balances: Liabilities: Accounts payable $ - $ $ $ Deposits payable Deferred revenues Unearned revenue 620,469 Due to other governments - - Due to other funds - 5,684,047 Advances from other funds - Total Liabilities 620,469 5,684,047 - - Fund Balances: Fund balances: Reserved: Reserved for prepaid costs - Reserved for notes receivable - Reserved for advances to other funds - - - Unreserved: Undesignated 18,444,271 400,420 7,893,399 Total Fund Balances - 18,444,271 400,420 7,893,399 Total Liabilities and Fund Balances $ 620,469 $ 24,128,318 $ 400,420 $ 7,893,399 rcl CITY OF LA QUINTA COMBINING BALANCE SHEET NONMAJOR GOVERNMENTAL FUNDS JUNE 30, 2008 Assets: Pooled cash and investments Receivables: Accounts Notes Accrued interest Prepaid costs Due from other governments Due from other funds Advances to other funds Restricted assets: Cash and investments with fiscal agents Total Assets Liabilities and Fund Balances: Liabilities: (Continued) Capital Projects Funds Parks and Library Community Street Recreation Development Center Facility $ $ $ 1,126,621 $ 311,965 4,307 1,207 $ $ $ 1,130,928 $ 313,172 Accounts payable $ $ $ $ Deposits payable - - Deferred revenues - Unearned revenue Due to other governments - Due to other funds - Advances from other funds 1,513,574 1,949,006 Total Liabilities 1,513,574 1,949,006 - Fund Balances: Fund balances: Reserved: Reserved for prepaid costs - Reserved for notes receivable - - Reserved for advances to other funds - - - Unreserved: Undesignated (1,513,574) (1,949,006) 1,130,928 313,172 Total Fund Balances (1,513,574) (1,949,006) 1,130,928 313,172 Total Liabilities and Fund Balances $ - $ - $ 1,130,928 $ 313,172 77 CITY OF LA QUINTA COMBINING BALANCE SHEET NONMAJOR GOVERNMENTAL FUNDS JUNE 30, 2008 Assets: Pooled cash and investments Receivables: Accounts Notes Accrued interest Prepaid costs Due from other governments Due from other funds Advances to other funds Restricted assets: Cash and investments with fiscal agents Total Assets Liabilities and Fund Balances: Liabilities: Capital Projects Fund§ Redevelopment Park Fire Agency Facility Facility PA No. 2 $ 97,291 $ $ 1,355,599 373 50,400 5,368 608 312,000 939,634 Debt Service Funds Financing Authority $ 10,138 655 $ 97,664 $ $ 2,663,609 $ 10,793 Accounts payable $ $ $ 9,550 $ Deposits payable 27,835 - Deferred revenues Unearned revenue _ Due to other governments - Due to other funds - - Advances from other funds 939,634 - Total Liabilities 939,634 37,385 - Fund Balances: Fund balances: Reserved: Reserved for prepaid costs 608 655 Reserved for notes receivable - Reserved for advances to other funds - 939,634 - Unreserved: Undesignated 97,664 (939,634) 1,685,982 10,138 Total Fund Balances 97,664 (939,634) 2,626,224 10,793 Total Liabilities and Fund Balances $ 97,664 $ $ 2,663,609 $ 10,793 78 CITY OF LA QUINTA COMBINING BALANCE SHEET NONMAJOR GOVERNMENTAL FUNDS JUNE 30, 2008 Liabilities and Fund Balances Liabilities: Accounts payable Total Deposits payable Governmental Deferred revenues Funds Assets: 764,428 Pooled cash and investments $ 28,809,909 Receivables: 6,015,461 Accounts 61,756 Notes 3,682,658 Accrued interest 106,328 Prepaid costs 3,212 Due from other governments 964,304 Due from other funds 312,000 Advances to other funds 939,634 Restricted assets: 939,634 Cash and investments with fiscal agents 24,128,318 Total Assets $ 59,008,119 Liabilities and Fund Balances Liabilities: Accounts payable $ 77,593 Deposits payable 237,242 Deferred revenues 1,924,986 Unearned revenue 764,428 Due to other governments 9,437 Due to other funds 6,015,461 Advances from other funds 5,479,938 Total Liabilities 14,509,085 Fund Balances: Fund balances: Reserved: Reserved for prepaid costs 3,212 Reserved for notes receivable 2,076,063 Reserved for advances to other funds 939,634 Unreserved: Undesignated 41,480,125 Total Fund Balances 44,499,034 Total Liabilities and Fund Balances $ 59,008,119 79 CITY OF LA QUINTA COMBINING STATEMENT OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCE NONMAJOR GOVERNMENTAL FUNDS YEAR ENDED JUNE 30, 2008 Revenues: Taxes Assessments Intergovernmental Contribution from property owners Charges for services Use of money and property Contributions Developer participation Loan repayments Total Revenues Expenditures: Current: General government Public safety Planning and development Community services Public works 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 assets Total Other Financing Sources (Uses) Net Change in Fund Balances Fund Balances, Beginning of Year Fund Balances, End of Year Special Revenue Funds State 2,191, 554 - 575,271 Gas 165,617 Federal 715,630 106,154 Tax Library Assistance SLEBG (3,346,142) (715,630) (101,188) 39,978 (3,346,142) 737,567 2,941,954 715,630 103,253 3,321 3,487 1,481,428 2,901 - 26,500 $ - $ 22,578 - 740,888 2,971,941 715,630 106,154 - 2,191,554 575,271 iR 2,191, 554 - 575,271 165,617 780,387 715,630 106,154 40,000 - - - (22) (3,346,142) (715,630) (101,188) 39,978 (3,346,142) (715,630) (101,188) 205,595 (2,565,755) 4,966 72,267 1,481,428 17,612 $ 277,862 $ (1,084,327) $ - $ 22,578 iR CITY OF LA QUINTA COMBINING STATEMENT OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCE NONMAJOR GOVERNMENTAL FUNDS YEAR ENDED JUNE 30, 2008 Revenues: Taxes Assessments Intergovernmental Contribution from property owners Charges for services Use of money and property Contributions Developer participation Loan repayments Total Revenues Expenditures: Current: General government Public safety Planning and development Community services Public works 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 assets Total Other Financing Sources (Uses) Net Change in Fund Balances Fund Balances, Beginning of Year Fund Balances, End of Year Special Revenue Funds Lighting Indian and Gaming Landscape RCTC 909,229 168,155 - 86,559 168,155 909,229 86,559 910,136 910,136 168,155 (907) (Continued) Quimby 4.300 404,835 299.326 32,000 32,000 86,559 676,461 (168,155) - (404,950) (2,569) (168,155) - (404,950) (2,569) (907) (318,391) 673,892 32,611 - 9,666,026 $ - $ 31,704 $ (318,391) $10,339,918 81 CITY OF LA QUINTA COMBINING STATEMENT OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCE NONMAJOR GOVERNMENTAL FUNDS YEAR ENDED JUNE 30, 2008 Revenues: Taxes Assessments Intergovernmental Contribution from property owners Charges for services Use of money and property Contributions Developer participation Loan repayments Total Revenues Expenditures: Current: General government Public safety Planning and development Community services Public works 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 assets Total Other Financing Sources (Uses) Net Change in Fund Balances Fund Balances, Beginning of Year Fund Balances, End of Year Special Revenue Funds Arts in Public Public South Coast Safety Places Air Quality 48,223 710 42,626 9,414 155,944 AB 939 110,900 57,583 710 198,570 57,637 168,483 - 16,119 149,636 198,781 - 198,781 16,119 149,636 710 (211) 41,518 18,847 2,000 2,000 - - 2,710 (211) 41,518 18,847 15,693 1,066,921 211,935 1,412,897 $ 18,403 $ 1,066,710 $ 253,453 $ 1,431,744 82 CITY OF LA QUINTA COMBINING STATEMENT OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCE NONMAJOR GOVERNMENTAL FUNDS YEAR ENDED JUNE 30, 2008 Revenues: Taxes Assessments Intergovernmental Contribution from property owners Charges for services Use of money and property Contributions Developer participation Loan repayments Total Revenues Expenditures: Current: General government Public safety Planning and development Community services Public works Debt service: Principal retirement Interest and fiscal charges Total Expenditures Excess (Deficiency) of Revenues Over (Under) Expenditures Other Financirig Sources (Uses): Transfers in Transfers out Proceeds from sale of capital assets Total Other Financing Sources (Uses) Net Change in Fund Balances Fund Balances, Beginning of Year Fund Balances, End of Year 7,405,006 7,405, 006 4,192, 308 313,156 (4,557,990) 39.332 39,332 'i7 qAQ nued) Justice Assistance Grant 10,607 10,607 10,607 (10,607) (4,086,773) _ (10,607) 105,535 37,349 5,681,326 120,513 $ 5,786,861 $ _ $ 157,862 $ 83 Special Revenue Funds Low/Moderate CV Violent Income Housing Development Crime _ PA No. 1 Agreement Task Force $ 10,869,078 $ $ $ - 70,961 275,665 - (19,240) 5,720 471,811 - 11,597,314 76,681 7,405,006 7,405, 006 4,192, 308 313,156 (4,557,990) 39.332 39,332 'i7 qAQ nued) Justice Assistance Grant 10,607 10,607 10,607 (10,607) (4,086,773) _ (10,607) 105,535 37,349 5,681,326 120,513 $ 5,786,861 $ _ $ 157,862 $ 83 CITY OF LA QUINTA COMBINING STATEMENT OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCE NONMAJOR GOVERNMENTAL FUNDS YEAR ENDED JUNE 30, 2008 Special Revenue Funds Capital Projects Funds 2004 Proposition 1 B Low/Mod Fund Bond Infrastructure Transportation Revenues: -- Taxes $ $ - $ $ Assessments - Intergovernmental 40,468 _ Contribution from property owners - Charges for services - - Use of money and property 12,644 1,602,168 14,372 309,869 Contributions - _ Developer participation 1,189,155 Loan repayments - - - Total Revenues 53,112 1,602,168 14,372 1,499,024 Expenditures: Current: General government - - - Public safety Planning and development 147,200 - - Community services - Public works Debt service: Principal retirement Interest and fiscal charges - Total Expenditures 147,200 - Excess (Deficiency) of Revenues Over (Under) Expenditures 53,112 1,454,968 14,372 1,499,024 Other Financing Sources (Uses): Transfers in - Transfers out (53,112) (21,294,034) (127,645) (779,162) Proceeds from sale of capital assets Total Other Financing Sources (Uses) (53,112) (21,294,034) (127,645) (779,162) Net Change in Fund Balances - (19,839,066) (113,273) 719,862 Fund Balances, Beginning of Year - 38,283,337 513,693 7,173,537 Fund Balances, End of Year $ - $ 18,444,271 $ 400,420 $ 7,893,399 84 CITY OF LA QUINTA COMBINING STATEMENT OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCE NONMAJOR GOVERNMENTAL FUNDS YEAR ENDED JUNE 30, 2008 (Continued) 85 Capital Projects Funds Parks and Library Community Street Recreation Development Center Facility Revenues: Taxes $ $ _ $ $ Assessments _ Intergovernmental Contribution from property owners _ Charges for services Use of money and property - 43,926 12,412 Contributions Developer participation 418,293 164,896 31,619 42,300 Loan repayments Total Revenues 418,293 164,896 75,545 54,712 Expenditures: Current: General government Public safety Planning and development Community services Public works _ Debt service: Principal retirement _ Interest and fiscal charges 78,425 88,471 Total Expenditures 78,425 88,471 _ Excess (Deficiency) of Revenues Over (Under) Expenditures 339,868 76,425 75,545 54,712 Other Financing Sources (Uses): Transfers in Transfers out - (54,029) Proceeds from sale of capital assets _ Total Other Financing Sources (Uses) - - - (54,029) Net Change in Fund Balances 339,868 76,425 75,545 683 Fund Balances, Beginning of Year (1,853,442) (2,025,431) 1,055,383 312,489 Fund Balances, End of Year `$ (1,513,574) $ (1,949,006) $ 1.130,928 $ 313,172 85 CITY OF LA QUINTA COMBINING STATEMENT OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCE NONMAJOR GOVERNMENTAL FUNDS YEAR ENDED JUNE 30, 2008 Debt Service Capital Projects Funds Funds Redevelopment Park Fire Agency Financing Facility Facility PA No. 2 Authority Revenues: Taxes $ - $ $ - $ Assessments - Intergovernmental - Contribution from property owners - 675,880 Charges for services - 9,641 Use of money and property 3,662 105,906 159 Contributions - - - Developer participation 10,559 47,882 Loan repayments - - Total Revenues 14,221 47,882 105,906 685,680 Expenditures: Current: General government - - - 9,641 Public safety - - Planning and development 157,238 Community services - Public works - Debt service: Principal retirement - 1,930,000 Interest and fiscal charges 42,845 4,672,686 Total Expenditures - 42,845 157,238 6,612,327 Excess (Deficiency) of Revenues Over (Under) Expenditures _ 14,221 5,037 (51,332) (5,926,647) Other Financing Sources (Uses): Transfers in - - 312,000 5,926,806 Transfers out (324,792) - Proceeds from sale of capital assets Total Other Financing Sources (Uses) - - (12,792) 5,926,806 Net Change in Fund Balances 14,221 5,037 (64,124) 159 Fund Balances, Beginning of Year 83,443 (944,671) 2,690,348 10,634 Fund Balances, End of Year $ 97,664 $ (939,634) $ 2,626,224 $ 10,793 CITY OF LA QUINTA COMBINING STATEMENT OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCE NONMAJOR GOVERNMENTAL FUNDS YEAR ENDED JUNE 30, 2008 Expenditures: Current: General government Total Public safety Governmental Planning and development Funds Revenues: 2,422,335 Taxes $ 10,869,078 Assessments 909,229 Intergovernmental 4,927,677 Contribution from property owners 951,545 Charges for services 120,541 Use of money and property 2,616,475 Contributions 26,500 Developer participation 2,359,974 Loan repayments 471,811 Total Revenues 23.252.830 Expenditures: Current: General government 9,641 Public safety 39,332 Planning and development 7,875,199 Community services 2,422,335 Public works 1,485,407 Debt service: Principal retirement 1,930,000 Interest and fiscal charges 4,882,427 Total Expenditures 18,644,341 Excess (Deficiency) of Revenues Over (Under) Expenditures 4,608,489 Other Financing Sources (Uses): Transfers in 6,593,962 Transfers out (31,940,027) Proceeds from sale of capital assets 158,061 Total Other Financing Sources (Uses) (25,188,004) Net Change in Fund Balances (20,579,515) Fund Balances, Beginning of Year 65,078,549 Fund Balances, End of Year $ 44,499,034 87 CITY OF LA QUINTA BUDGETARY COMPARISON SCHEDULE STATE GAS TAX YEAR ENDED JUNE 30, 2008 Budgetary Fund Balance, July Resources (Inflows): Intergovernmental Use of money and property Transfers from other funds Amounts Available for Appropriation Charges to Appropriation (Outflow): Public works Transfers to other funds Total Charges to Appropriations Budgetary Fund Balance, June 30 Budget Amounts Original Final $ 72,267 $ 72,267 Variance with Final Budget Actual Positive Amounts (Negative) $ 72,267 $ - 743,100 743,100 737,567 (5,533) 13,100 13,100 3,321 (9,779) - - 40.000 40,000 828,467 828,467 853,155 24,688 575,271 575,271 575,271 - 1,489 22 1,467 575,271 576,760 575,293 1,467 $ 253,196 $ 251,707 $ 277,862 $ 26,155 :: CITY OF LA QUINTA BUDGETARY COMPARISON SCHEDULE LIBRARY YEAR ENDED JUNE 30, 2008 Budgetary Fund Balance, July 1 Resources (Inflows): Intergovernmental Charges for services Use of money and property Contributions Amounts Available for Appropriation Charges to Appropriation (Outflow): Public works Community services Transfers to other funds Total Charges to Appropriations Variance with Budgetary Fund Balance, June 30 $ 930,599 $ (1,889,182) $(1,084,327) $ 804,855 Final Budget Budget Amounts Actual Positive Original Final Amounts (Negative) $ 1,481,428 $ 11481,428 $ 1,481,428 $ 2,000,700 2,000,700 2,941,954 941,254 45,000 45,000 3,487 (41,513) - 26,500 26,500 3,527,128 3,553,628 4,453,369 899,741 2,096,529 2,096,529 2,191,554 (95,025) 500,000 3,346,281 3,346,142 139 2,596,529 5,442,810 5,537,696 u (94,886) Budgetary Fund Balance, June 30 $ 930,599 $ (1,889,182) $(1,084,327) $ 804,855 CITY OF LA QUINTA BUDGETARY COMPARISON SCHEDULES FEDERAL ASSISTANCE YEAR ENDED JUNE 30, 2008 Budgetary Fund Balance, July 1 Resources (Inflows): Intergovernmental Transfers from other funds Amounts Available for Appropriation Charges to Appropriation (Outflow): Transfers to other funds Total Charges to Appropriations Budgetary Fund Balance, June 30 Variance with Final Budget Budget Amounts Actual Positive Original Final Amounts (Negative) 164,800 706,276 715,630 9,354 164,800 706,276 715,630 9,354 190,000 706,276 715,630 (9,35 190,000 706,276 715,630 (9,354) $25,200) $ - $ - $ .0 CITY OF LA QUINTA BUDGETARY COMPARISON SCHEDULE SLEBG YEAR ENDED JUNE 30, 2008 Budgetary Fund Balance, July 1 Resources (Inflows): Intergovernmental Use of money and property Transfers from other funds Amounts Available for Appropriation Charges to Appropriation (Outflow): Transfers to other funds Total Charges to Appropriations Budgetary Fund Balance, June 30 Budget Amounts Original Final $ 17,612 $ 17,612 $ Variance with Final Budget Actual Positive Amounts (Negative) 17,612 $ - 100,000 100,000 103,253 3,253 400 400 2,901 2,501 118,012 118,012 123,766 5,754 100,400 100,400 101,188 (788) 100,400 100,400 101,188 (788) $ 17,612 $ 17,612 $ 22,578 $ 4,966 91 CITY OF LA QUINTA BUDGETARY COMPARISON SCHEDULE INDIAN GAMING YEAR ENDED JUNE 30, 2008 Budgetary Fund Balance, July 1 Resources (Inflows): Intergovernmental Use of money and property Amounts Available for Appropriation Charges to Appropriation (Outflow): Transfers to other funds Total Charges to Appropriations Budget Amounts Original Final Variance with Final Budget Actual Positive Amounts (Negative) 177,250 177,250 168,155 (9,095) 13,500 13,500 13,500 190,750 190,750 168,155 (2 201,142 201,142 168,155 32,987 201,142 201,142 168,155 32,987 Budgetary Fund Balance, June 30 $ (10,392) $ (10,392) $ - $ 10,392 M CITY OF LA QUINTA BUDGETARY COMPARISON SCHEDULE LIGHTING AND LANDSCAPE YEAR ENDED JUNE 30, 2008 Budgetary Fund Balance, July 1 Resources (Inflows): Assessments Amounts Available for Appropriation Charges to Appropriation (Outflow): Public works Total Charges to Appropriations Budgetary Fund Balance, June 30 Variance with 93 Final Budget Budget Amounts Actual Positive Original Final Amounts (Negative) $ 32,611 $ 32,611 $ 32,611 $ - 916,500 916,500 909,229 (7,271 949,111 949,111 941,840 (7,271) 916,500 916,500 910,136 6,364 916,500 916,500 910,136 6,364 $ 32,611 $ 32,611 $ 31,704 $ (907) 93 CITY OF LA QUINTA BUDGETARY COMPARISON SCHEDULE RCTC YEAR ENDED JUNE 30, 2008 Budgetary Fund Balance, July 1 Resources (Inflows): Intergovernmental Transfers from other funds Amounts Available for Appropriation Charges to Appropriation (Outflow): Transfers to other funds Total Charges to Appropriations Budgetary Fund Balance, June 30 $ 2,327,400 $ (1,857,019) $ (318,391) $ 1,538,628 Variance with Final Budget Budget Amounts Actual Positive Original Final Amounts (Negative) 2,327,400 2,292,807 86,559 (2,206,248) 2,327,400 2,292,807 86,559 (2,206,248) - 4,149,826 404,950 3,744,876 4,149,826 404,950 3,744,876 Budgetary Fund Balance, June 30 $ 2,327,400 $ (1,857,019) $ (318,391) $ 1,538,628 CITY OF LA QUINTA BUDGETARY COMPARISON SCHEDULE QUIMBY YEAR ENDED JUNE 30, 2008 Budgetary Fund Balance, July 1 Resources (Inflows): Intergovernmental Use of money and property Developer fees Amounts Available for Appropriation Charges to appropriation (outflow): Community services Transfers to other funds Total Charges to Appropriations Budget Amounts Original Final $ 9,666,026 $ 9,666,026 Actual Amounts $ 9,666,026 Variance with Final Budget Positive (Negative) - 4,300 4,300 422,000 422,000 404,835 (17,165) 1,016,000 1,016,000 299,326 (716,674) 11,104,026 11,104,026 10,374,487 (729_ ,539) - - 32,000 (32,000) 8,540,100 8,572,100 2.569 8,569,531 8,540,100 8,572,100 34,569 8,537,531 Budgetary Fund Balance, June 30 $ 2,563,926 $ 2,531,926 $ 10,339,918 $ 7,807,992 95 CITY OF LA QUINTA BUDGETARY COMPARISON SCHEDULE PUBLIC SAFETY YEAR ENDED JUNE 30, 2008 Budgetary Fund Balance, July 1 Resources (Inflows): Use of money and property Transfers from other funds Amounts Available for Appropriation Charges to Appropriation (Outflow): Public safety Total Charges to Appropriations Budgetary Fund Balance, June 30 Variance with KI Final Budget Budget Amounts Actual Positive Original Final Amounts (Negative) $ 15,693 $ 15,693 $ 15,693 $ 2,000 2,000 710 (1,290) 600 600 2,000 1,400 18,293 18,293 18,403 110 2,000 2,000 - 2,O00 2,000 2,000 - 2,000 $ 16,293 $ 16,293 $ 18,403 $ 2,110 KI CITY OF LA QUINTA BUDGET COMPARISON SCHEDULE ARTS IN PUBLIC PLACES YEAR ENDED JUNE 30, 2008 Budgetary Fund Balance, July 1 Resources (Inflows): Use of money and property Developer fees Amounts available for appropriation Charges to Appropriation (Outflow): Community services Transfers to other funds Total Charges to Appropriations Budgetary Fund Balance, June 30 Variance with I Final Budget Budget Amounts Actual Positive Original Final Amounts (Negative) $ 1,066,921 $ 1,066,921 $ 1,066,921 $ - 16,400 40,000 42,626 2,626 97,500 97,500 155,944 58,444 1,180,821 1,204,421 1,265,491 61,070 488,450 488,450 198,781 289,669 200,000 400,000 - 400,000 688,450 888,450 198,781 689,669 $ 492,371 $ 315,971 $ 1,066,710 $ 750,739 I CITY OF LA QUINTA BUDGETARY COMPARISON SCHEDULE SOUTH COAST AIR QUALITY YEAR ENDED JUNE 30, 2008 Budgetary Fund Balance, July 1 Resources (Inflows): Intergovernmental Use of money and property Amounts Available for Appropriation Charges to Appropriation (Outflow): Planning and development Total Charges to Appropriations Budgetary Fund Balance, June 30 Budget Amounts Original Final $ 211,935 $ 211,935 Variance with Final Budget Actual Positive Amounts (Negative) $ 211,935 $ - 47,700 47,700 48,223 523 9,200 9,200 9,414 214 268,835 268,835 269,572 737 26,600 26,600 16,119 10,481 26,600 26,600 16,119 10,481 $ 242,235 $ 242,235 $ 253,453 $ 11,218 CITY OF LA QUINTA BUDGETARY COMPARISON SCHEDULE AB 939 YEAR ENDED JUNE 30, 2008 Budgetary Fund Balance, July 1 Resources (Inflows): Charges for services Use of money and property Amounts Available for Appropriation Charges to Appropriation (Outflow): Planning and development Total Charges to Appropriations Budgetary Fund Balance, June 30 Variance with Final Budget Budget Amounts Actual Positive Original Final Ambunts (Negative) $ 1,412,897 $ 1,412,897 $ 1,412,897 $ - - 110,900 110,900 - 54,800 54,800 57,583 2,783 1,467,697 1,578,597 1,581,380 2,783 202,500 238,500 149,636 88,864 cuc,auu csa,buu -14y,oso aa,ab4 $ 1,265,197 $ 1,340,097 $ 1,431,744 $ 91,647 M, CITY OF LA QUINTA BUDGETARY COMPARISON SCHEDULE LOW/MODERATE INCOME HOUSING PA NO. 1 YEAR ENDED JUNE 30, 2008 Budgetary Fund Balance, July 1 Resources (Inflows): Taxes Contributions from property owners Use of money and property Proceeds from sale of capital assets Other financing sources Loan repayments Transfers from other funds Amounts Available for Appropriation Charges to Appropriation (Outflow): Planning and development Transfers to other funds Total Charges to Appropriations Budgetary Fund Balance, June 30 Budget Amounts Original Final $ 5,681,326 $ 5,681,326 Actual Amounts $ 5,681,326 Variance with Final Budget Positive (Negative) 10,600,600 11,166,237 10,869,078 (297,159) 252,000 252,000 275,665 23,665 404,800 404,800 (19,240) (424,040) 150,000 150,000 158,061 8,061 - 125,000 - (125,000) 354,000 471,811 117,811 313,156 313,156 17,088,726 18,446,519 17,749,857 (696,662) 1,616,335 12,204,797 7,405,006 4,799,791 4,450,261 4,557,990 4,557,990 6,066,596 16,762,787 11,962,996 4,799,791 $ 11,022,130 $ 1,683,732 $ 5,786,861 $ 4,103,129 100 CITY OF LA QUINTA BUDGETARY COMPARISON SCHEDULE CV VIOLENT CRIME TASK FORCE YEAR ENDED JUNE 30, 2008 101 Variance with Final Budget Budget Amounts Actual Positive Original Final Amounts (Negative) Budgetary fund balance, July 1 $ 120,513 $ 120,513 $ 120,513 $ - Resources (inflows): Intergovernmental 98,500 141,000 70,961 (70,039) Use of money and property 3,000 5,000 5,720 720 Amounts available for appropriation 222,013 266,513 197,194 (69,319) Charges to appropriation (outflow): Public safety 57,100 57,100 39,332 17,768 Total Charges to Appropriations 57,100 57,100 39,332 17,768 Budgetary fund balance, June 30 $ 164,913 $ 209,413 $ 157,862 $ (51,551) 101 CITY OF LA QUINTA BUDGETARY COMPARISON SCHEDULE JUSTICE ASSISTANCE GRANT YEAR ENDED JUNE 30, 2008 Budgetary fund balance, July 1 Resources (inflows): Intergovernmental Amounts available for appropriation Charges to appropriation (outflow): Transfers to other funds Total Charges to Appropriations Budgetary fund balance, June 30 Variance with Final Budget Budget Amounts Actual Positive Original Final Amounts Negative) 10,607 10,607 10,607 10,607 10,607 10,607 102 �v,vvr ��,vvr rv,ovr - CITY OF LA QUINTA BUDGETARY COMPARISON SCHEDULE PROPOSITION 1 B FUND YEAR ENDED JUNE 30, 2008 Budgetary fund balance, July 1 Resources (inflows): Intergovernmental Invest Income Amounts available for appropriation Charges to appropriation (outflow): Transfers to other funds Budgetary fund balance, June 30 Budget Amounts Original Final 103 Variance with Final Budget Actual Positive Amounts (Negative) 660,937 40,468 (620,469) - 12,644 12,644 660,937 53,112 607,825 660,937 53,112 607,825 660,937 53,112 607,825 CITY OF LA QUINTA BUDGETARY COMPARISON SCHEDULE CAPITAL IMPROVEMENT YEAR ENDED JUNE 30, 2008 Budgetary Fund Balance, July 1 Resources (Inflows): Intergovernmental Use of money and property Developer fees Transfers from other funds Amounts Available for Appropriation Charges to Appropriation (Outflow): Capital outlay Debt service: Principal Interest and fiscal charges Total Charges to Appropriations Budgetary Fund Balance, June 30 Variance with 104 Final Budget Budget Amounts Actual Positive Original Final Amounts (Negative) 8,545,600 12,159,595 1,311,904 (10,847,691) 430,000 4,733,867 3,618,748 (1,115,119) 61,298,197 136,966,696 40,624,429 (96,342,267) 70,273,797 153,860,158 45,555,081 (108,305,077) 70,080,044 153,666,405 45,266,627 108,399,778 50,000 50,000 193,753 (143,753) 143,753 143,753 54,701 89,052 70,273,797 153,860,158 45,555,081 108,305,077 104 CITY OF LA QUINTA BUDGETARY COMPARISON SCHEDULE REDEVELOPMENT AGENCY PA NO. 1 - CAPITAL PROJECTS YEAR ENDED JUNE 30, 2008 105 Variance with Final Budget Budget Amounts Actual Positive Original _ Final Amounts (Negative) Budgetary Fund Balance, July 1 $ 20,940,368 $ 20,940,368 $ 20,940,368 $ - Resources (Inflows): Use of money and property 537,900 1,087,900 1,411,698 323,798 Developer fees - 201,379 201,379 Other financing sources 3,894,600 - - - Transfers from other funds 25,000,000 25,180,355 25,180,355 Amounts Available for Appropriation 50,372,868 47,208,623 47,733,800 525,177 Charges to Appropriation (Outflow): Planning and development 1,096,359 1,338,112 986,428 351,684 Transfers to other funds 46,714,237 63,171,468 _ 3,623,184 59,548,284 Total Charges to Appropriations 47,810,596 64,509,580 4,609,612 59,899,968 Budgetary Fund Balance, June 30 $ 2,562,272 $ (17,300,957) $ 43,124,188 $ 60,425,145 105 CITY OF LA QUINTA BUDGETARY COMPARISON SCHEDULE CIVIC CENTER YEAR ENDED JUNE 30. 2008 Budgetary Fund Balance, July 1 Resources (Inflows): Use of money and property Developer fees Amounts Available for Appropriation Charges to Appropriation (Outflow): General government Public works Debt service: Interest and fiscal charges Transfers to other funds Total Charges to Appropriations Budgetary Fund Balance, June 30 Variance with Final Budget Budget Amounts Actual Positive Original Final Amounts (Negative) $ (3,031,324) $ (3,031,324) $(3,031,324) $ - 68,400 - - - 194,700 194,700 357,890 163,190 (2,768,224) (2,836,624) (2,673,434) 163,190 202,764 202,764 202,764 - - - 2,892 (2,892) 200,000 273,248 (73,248) - 6,240,662 6,240,662 - 202,764 6,643,426 6,719,566 (76,140) $ (2,970,988) $ (9,480,050) X393,000) $ 87,050 110 CITY OF LA QUINTA BUDGETARY COMPARISON SCHEDULE COMMUNITY CENTER YEAR ENDED JUNE 30, 2008 Budgetary Fund Balance, July 1 Resources (Inflows): Use of money and property Developer fees Amounts Available for Appropriation Budgetary Fund Balance, June 30 Variance with 111 Final Budget _ Budget Amounts Actual Positive Ordinal Final Amounts (Negative) $1,055,383 $ 1,055,383 $ 1,055,383 $ 46,900 46,900 43,926 (2,974) 28,000 28,000 31,619 3;619 1,130,283 1,130,283 1,130,928 645 $1,130,283 $ 1,130,283 $ 1,130,928 $ 645 111 CITY OF LA QUINTA BUDGETARY COMPARISON SCHEDULE STREET FACILITY YEAR ENDED JUNE 30, 2008 Budgetary Fund Balance, July, 1 Resources (Inflows): Use of money and property Developer fees Transfers from other funds Amounts Available for Appropriation Charges to Appropriation (Outflow): Transfers to other funds Total Charges to Appropriations Budgetary Fund Balance, June 30 Budget Amounts Original Final $ 312,489 $ 312,489 Variance with Final Budget Actual Positive Amounts legative) $ 312,489 $ 11,200 11,200 12,412 1,212 44,100 44,100 42,300 (1,800) 28,886 28,886 - (28,886) 396,675 396,675 367,201 29,474 345,000 385,825 54,029 331,796 345,000 385,825 54,029 331,796 $ 51,675 $ 10,850 $ 313,172 $ 302,322 112 CITY OF LA QUINTA BUDGETARY COMPARISON SCHEDULE PARK FACILITY YEAR ENDED JUNE 30, 2008 Budgetary Fund Balance, July 1 Resources (Inflows): Use of money and property Developer fees Amounts Available for Appropriation Charges to Appropriation (Outflow): Transfers to other funds Total Charges to Appropriations Budgetary Fund Balance, June 30 Variance with 113 Final Budget Budget Amounts Actual Positive Original Final Amounts (Negative) $ 83,443 $ 83,443 $ 83,443 $ - 3,600 3,600 3,662 62 8,000 8,000 10,559 2,559 95,043 95,043 97,664 2,621 28,886 28,886 - 28,886 28,886 28,886 - 28,886 $ 66,157 $ 66,157 $ 97,664 $ 31,507 113 CITY OF LA QUINTA BUDGETARY COMPARISON SCHEDULE FIRE FACILITY YEAR ENDED JUNE 30, 2008 Budgetary Fund Balance, July 1 Resources (Inflows): Developer fees Amounts Available for Appropriation Charges to Appropriation (Outflow): Debt service: Interest and fiscal charges Total Charges to Appropriations Variance with 35,000 42,845 (7,845) 35,000 42,845 (7,845) Budgetary Fund Balance, June 30 _L(917,671.. $ (952,671) $ (939,634) $ 13,037 114 Final Budget Budget Amounts Actual Positive Original Final Amounts (Negative) $ (944,671) $ (944,671) $ (944,671) $ 27,000 27,000 47,882 20,882 (917,671) (917,671) 896,789 20,882 35,000 42,845 (7,845) 35,000 42,845 (7,845) Budgetary Fund Balance, June 30 _L(917,671.. $ (952,671) $ (939,634) $ 13,037 114 CITY OF LA QUINTA BUDGETARY COMPARISON SCHEDULE REDEVELOPMENT AGENCY PA NO. 2 - CAPITAL PROJECTS YEAR ENDED JUNE 30, 2008 Budgetary Fund Balance, July 1 Resources (Inflows): Use of money and property Transfers from other funds Amounts Available for Appropriation Charges to Appropriation (Outflow): Planning and development Transfers to other funds Total Charges to Appropriations Budgetary Fund Balance, June 30 Budget Amounts Original Final $ 2,690,348 $ 2,690,348 Variance with Final Budget Actual Positive Amounts (Negative) $ 2,690,348 $ - 58,900 80,000 105,906 - 312,000 312,000 2,749,248 3,082,348 3,108,254 25,906 25,906 149,632 268,085 157,238 110,847 275,000 473,004 324,792 148,212 424,632 741,089 482,030 259,059 $ 2,324,616 $ 2,341,259 $ 2,626,224 $ 284,965 115 CITY OF LA QUINTA BUDGETARY COMPARISON SCHEDULE REDEVELOPMENT AGENCY PA NO. 1 - DEBT SERVICE YEAR ENDED JUNE 30, 2008 Variance with 116 Final Budget Budget Amounts Actual Positive Original Final Amounts (Negative) Budgetary Fund Balance, July 1 $ 21,388,244 $ 21,388,244 $ 21,388,244 $ Resources (Inflows): Taxes 42,638,700 44,664,949 43,476,312 (1,188,637) Use of money and property 896,100 596,100 698,250 102,150 Transfers from other funds 4,450,261 4,557,990 4,557,990 - Amounts Available for Appropriation 69,373,305 71,207,283 70,120,796 (1,086,487) Charges to Appropriation (Outflow): General government 457,300 457,300 386,073 71,227 Debt service: Principal 3,514,579 3,565,558 3,565,558 - Interest and fiscal charges 8,520,553 8,520,553 8,528,282 (7,729) Pass through agreement payments 22,808,012 23,901,662 23,585,426 316,236 Transfers to other funds 28,970,960 28,970,960 28,970,960 Total Charges to Appropriations 64,271,404 65,416,033 65,036,299 379,734 Budgetary Fund Balance, June 30 $ 5,101,901 $ 5,791,250 $ 5,084,497 $ (706,75_ 116 CITY OF LA QUINTA BUDGETARY COMPARISON SCHEDULE REDEVELOPMENT AGENCY PA NO. 2 - DEBT SERVICE YEAR ENDED JUNE 30, 2008 Variance with 117 Final Budget Budget Amounts Actual Positive Original Final Amounts (Negative) Budgetary Fund Balance, July 1 $ 2,910,342 $ 2,910,342 $ 2,910,342 $ - Resources (Inflows): Taxes 22,923,100 22,806,640 23,087,750 281,110 Use of money and property 573,200 300,000 477,355 177,355 Transfers from other funds 1,955,846 1,955,846 1,955,846 - Amounts Available for Appropriation 28,362,488 27,972,828 28,431,293 458,465 Charges to Appropriation (Outflow): General government 176,100 176,100 202,081 (25,981) Principal 110,000 260,000 260,000 Interest and fiscal charges 1,310,135 1,660,135 1,686,050 (25,915) Pass through agreement payments 18,688,406 18,538,406 19,403,597 (865,191) Transfers to other funds 1,955,846 11,334,812 11,334,812 Total Charges to Appropriations 22,240,487 31,969,453 32,886,540 (917,087) Budgetary Fund Balance, June 30 $ 6,122,001 $ (3,996,625) $ (4,455,247) $ (458,622) 117 CITY OF LA QUINTA BUDGETARY COMPARISON SCHEDULE FINANCING AUTHORITY - DEBT SERVICE YEAR ENDED JUNE 30, 2008 Budgetary Fund Balance, July 1 Resources (Inflows): Contributions from property owners Charges for services Use of money and property Transfers from other funds Amounts Available for Appropriation Charges to Appropriation (Outflow): General government Debt service: Principal Interest and fiscal charges Total Charges to Appropriations Budget Amounts Original Final $ 10,634 ®$ 10,634 Actual Amounts $ 10,634 Variance with Final Budget Positive (Negative) 675,880 675,880 675,880 15,000 15,000 9,641 (5,359) - - 159 159 5,926,806 5,926,806 5,926,806 - 6,628,320 6,628,320 6,623,120 (5,200) 15,800 15,800 9,641 6,159 1,930,000 1,930,000 1,930,000 - 4,672,686 4,672,686 4,672,686 61618,486 6,618,486 6,612,327 6,159 Budgetary Fund Balance, June 30 $ 9,834 $ 9,834 $ 10,793 $ 959 118 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 TE3Ghnolooy 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. 119 CITY OF LA QUINTA COMBINING STATEMENT OF NET ASSETS INTERNAL SERVICE FUNDS JUNE 30, 2008 Assets: Current: Cash and investments Receivables: Interest 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 Total Current Liabilities Long -Term: Compensated absences Total Long -Term Liabilities: Total Liabilities Net Assets: Invested in capital assets, net of related debts Unrestricted Total Net Assets Total Liabilities and Net Assets Park Equipment Information Equipment Replacement Technology and Facility Total $ 2,129,604 $ 1,102,955 $ 1,295,035 $ 4,527,594 9,228 4,250 5,011 18,489 2,138,832 1,107,205 1,300,046 4,546,083 1,282,411 467,368 14,817,286 16,567,065 1,282,411 467,368 14,817,286 16,567,065 $ 3,421,243 $ 1,574,573 $16,117,332 $21,113,148 $ 12,819 $ 12,395 $ 53 $ 25,267 - 2,331 - 2,331 12,819 14,726 53 27,598 3,928 - 3,928 - 3,928 3,928 12,819 18,654 53 31,526 1,282,411 467,368 14,817,286 16,567,065 2,126,013 1,088,551 1,299,993 4,514,557 3,408,424 1,555,919 16,117,279 21,081,622 $ 3,421,243 $ 1,574,573 $ 16,117,332 $ 21,113,148 120 CITY OF LA QUINTA COMBINING STATEMENT OF REVENUES, EXPENSES AND CHANGES IN FUND NET ASSETS INTERNAL SERVICE FUNDS YEAR ENDED JUNE 30, 2008 Operating Revenues: Sales and service charges Total Operating Revenues Operating Expenses: Salaries and benefits Fuel and oil Maintenance and parts Contract services Software and supplies Depreciation Other Total Operating Expenses Operating Income (Loss) Non -Operating Revenues (Expenses): Interest revenue Gain on disposition of assets Total Non -Operating Revenues Income Before Contributions and Transfers Capital contributions Transfers in Transfers out Change in Net Assets Net Assets: Beginning of Year Change in Net Assets End of Fiscal Year 121 Park Equipment Information Equipment Replacement Technology and Facility Totals $ 590,885 $ 525,026 $ 391,190 $ 1,507,101 590,885 525,026 _ 391,190 1,507,101 - 97,953 - 97,953 94,687 94,687 126,622 - - 126,622 7,844 59,390 17,445 84,679 - 126,002 - 126,002 262,598 86,085 415,108 763,791 45,054 16,544 61,598 536,805 385,974 432,553 1,355,332 54,080 139,052 (41,363) 151,769 118,833 44,737 49,935 213,505 5,985 - 5,985 124,818 44,737 49,935 219,490 178,898 183,789 8,572 371,259 306,804 74,247 136,413 517,464 (1,262,074) - (1,262,074) (776,372) 258,036 144,985 (373,351) 4,184,796 1,297,883 15,972,294 21,454,973 (776,372) 258,036 144,985 (373,351) $ 3,408,424 $ 1,555,919 $16,117,279 $21,081,622 121 CITY OF LA QUINTA COMBINING STATEMENT OF CASH FLOWS INTERNAL SERVICE FUNDS YEAR ENDED JUNE 30, 2008 Cash Flows from Operating Activities: Cash received from customers and users Cash paid to supplies for good and services Cash paid to employees for services Net Cash Provided (Used) by Operating Activities Cash Flows from Non -Capital Financing Activities: Cash transfers out Net Cash Provided (Used) by Non -Capital Financing Activities Cash Flows from Capital and Related Financing Activities: Acquisition and construction of capital assets Insurance proceeds 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 due from other governments Increase (decrease) in accounts payable Increase (decrease) in accrued liabilities 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 (1,262,074) (1,262,074) (1,262,074) (1,262,074) (327,033) (327,033) 2,100 2,100 7,840 7,840 (317,093) - (317,093) 123,659 44,268 Park 216,674 Equipment Information Equipment 44,268 Replacement Technology_ - and Facility Totals $ 590,885 $ 525,026 $ 391,190 $ 1,507,1.01 (275,276) (202,050) (17,392) (494,718) - (97,590) $ 1,102,955 X01 315,609 225,386 373,798 914,793 (1,262,074) (1,262,074) (1,262,074) (1,262,074) (327,033) (327,033) 2,100 2,100 7,840 7,840 (317,093) - (317,093) 123,659 44,268 48.747 216,674 123,659 44,268 48,747 216,674 (1,139,899) 269,654 422,545 (447,700) 3,269,503 833,301 872.490 4,975,294 $ 2,129,604 $ 1,102,955 $ 1,295,035 $ 4,527,594 $ 54,080 $ 139,052 $ (41,363) $ 151.769 262,598 86,085 415,108 763,791 - 330 330 (1,069) (445) 53 (1,461) 604 604 (240) - (240) 261,529 86,334 415,161 763,024 $ 315,609 $ 225,386 $ 373,798 $ 914,793 $ 306,804 $ 74,247 $ 136,413 $ 517,464 122 AGENCYFUNDS Agency funds are used to account for assets held by the City as an agent for an 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. 92-1, 97-1 2001-1 — To account for assessments paid to the City for debt service payments on bond issues used to finance sewer improvements. 123 CITY OF LA QUINTA COMBINING BALANCE SHEET ALL AGENCY FUNDS JUNE 30, 2008 Liabilities: Deposits $ $ 153,156 $ 480,579 $ 633,735 Total Liabilities $ - $ 153,156 $ 480,579 $ 633,735 124 Assessment Assessment Assessment District District District No. 92-1 No. 97-1 No. 2001-1 Totals__ Assets: Cash and investments $ - $ 151,035 $ 458,129 $ 609,164 Receivables: Taxes 1,567 20,755 22,322 Interest - 554 1,695 2,249 Total Assets $ $ 153,156 $ 480,579 $ 633,735 Liabilities: Deposits $ $ 153,156 $ 480,579 $ 633,735 Total Liabilities $ - $ 153,156 $ 480,579 $ 633,735 124 CITY OF LA QUINTA COMBINING STATEMENT OF CHANGES IN ASSETS AND LIABILITIES ALL AGENCY FUNDS YEAR ENDED JUNE 30, 2008 Assessment District No. 97-1 Assets: Cash and investments $ Balance $ 67,852 $ 59,389 Balance 151,035 July 1, 2007 Additions Deductions June 30, 2008 Assessment District No. 92-1 Taxes 2,711 Assets: 2,711 1,567 Interest 580 Cash and investments $ 318,318 $ 15,406 $ 333,724 $ - Receivables: $ 69,972 $ 62,679 $ 153,156 Liabilities: Taxes 10,583 - 10,583 Interest $ 1,320 $ - $ 1,320 $ Total Assets $ 330,221 $ 15,406 $ 345,627 $ Liabilities: 153,156 Deposits $ 330,221 $ 5,058 $ 335,279 $ - Total Liabilities $ 330,221 $ 5,058 $ 335,279 $ - Assessment District No. 97-1 Assets: Cash and investments $ 142,572 $ 67,852 $ 59,389 $ 151,035 Receivables: Taxes 2,711 1,567 2,711 1,567 Interest 580 553 579 554 Total Assets $ 145,863 $ 69,972 $ 62,679 $ 153,156 Liabilities: Deposits $ 145,863 $ 66,840 $ 59,547 $ 153,156 Total Liabilities $ 145,863 $ 66,840 $ 59,547 $ 153,156 Assessment District No. 2001-1 Assets: Cash and investments $ 447,592 $ 210,566 $ 200,029 $ 458,129 Receivables: Taxes 10,023 20,755 10,023 20,755 Interest 1.836 1,695 1,836 1,695 Total Assets $ 459,451 $ 233,016 $ 211,888 $ 480,579 Liabilities: Deposits $ 459,451 $ 222,405 $ 201,277 $ 480,579 Total Liabilities $ 459,451 $ 222,405 $ 201,277 $ 480,579 125 CITY OF LA QUINTA COMBINING STATEMENT OF CHANGES IN ASSETS AND LIABILITIES ALL AGENCY FUNDS YEAR ENDED JUNE 30, 2008 Total - All Aaencv Funds Assets: Cash and investments Receivables: Accounts Interest Total Assets Liabilities: Deposits Balance Balance July 1, 2007 Additions Deductions June 30, 2008 $ 908,482 $ 293,824 $ 593,142 $ 609,164 23,317 22,322 23,317 22,322 3,736 2,248 3,735 2,249 $ 935,535 $ 318,394 $ 620,194 $ 633,735 Total Liabilities $ 935,535 $ 294,303 $ 596,103 $ 633,735 126 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 government's financial performance and well-being have changed over time. Revenue Capacity These schedules obtain information to help the reader assess the government's most significant local revenue source, the property tax. 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. 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. 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. 127 TABLE l CITY OF LA QUINTA Net Assets by Component Last Eight Fiscal Years (accrual basis of accounting) The City of La Quinta implemented GASB 34 for the fiscal year ended June 30, 2001. Information prior to the implementation of GASB 34 is not available. Source: Cityof la Quinta 128 Fiscal Year 2001 2002 2003 2004 2005 2006 2007 2008 Governmental activities: Invested in capital assets, net of related debt $ 217,419,724 195,474,945 225,818,022 249,059,500 233,361,129 253,559,117 300,220,033 343,019,328 Restricted 45,438,930 74,156,691 40,038,313 44,415,966 43,421,857 65,159,623 49,277,895 86,041,189 Unrestricted 30,698,622 43,025,999 48,290,000 45,169,328 60,361,071 86,129,376 106,939,577 79,642,102 Total governmental activities net assets $ 293,557,276 312,657,635 314,146,335 338,644,794 337,144,057 404,848,116 456,437,505 508,702,619 Business -type activities: Invested in capital assets, net of related debt $ - 41,300,846 42,075,172 42,692,025 42,778,015 Restricted Unrestricted (626,658) (1,665,646) (2,385,462) (3,109,524) Total business -type activities net assets - 40,674,188 40,409,526 40,306,563 39,668,491 Primary government Invested in capital assets, net of related debt $ 217,419,724 195,474,945 225,818,022 249,059,500 274,661,975 295,634,289 342,912,058 385,797,343 Restricted 45,438,930 74,156,691 40,038,313 44,415,966 43,421,857 65,159,623 49,277,895 86,041,189 Unrestricted 30,698,622 43,025,999 48,290,000 45,169,328 59,734,413 84,463,730 104,554,115 76,532,578 Total primary government net assets $ 293,557,276 312,657,635 314,146,335 338,644,794 377,818,245 445,257,642 496,744,068 548,371,110 The City of La Quinta implemented GASB 34 for the fiscal year ended June 30, 2001. Information prior to the implementation of GASB 34 is not available. Source: Cityof la Quinta 128 2001 CffY OF LA QGINTA Changes in Net Assds Last Eight Fiscal Years (arcual basis of accourdirrgl Fiscal Year 2001 2004 2005 2006 E.pc-. 3,595,906 4,229,871 6,284,342 Goverrurcwl activities: t0,256,463 8,512,875 9,065,244 General gonnnerent S 3,146,699 3,241,576 3,203,462 Public safety 5,776,628 7,522,532 8,547,005 Conurwnily services 940,881 1,411,947 1,321,825 Plamdog and developmem 6,146,998 7,110,125 19,083,860 Public works 5,968,911 6,434,239 6,785,759 Interest on long-term debt 5,861,632 7,791,759 8,555,401 Total governmental aowifes expenses 27,841,749 33,512,174 47,497,312 Bnsimss-type activities: 4,523,146 4,520,173 4,761,581 Golf Course 1,877,291 7,523,146 4,520,173 Total busineecrype activities expenses 39,212,009 45,262,085 50,652,200 Total primarygoverrumem expenses 27,841,749 31,512,174 47,497,312 Program revenues: 5,905,664 Capital panus and contributions 14,375,463 Govemmental activities: 5,160,405 12,090,141 18,591,421 Charges for services: 17,601,111 50,090419 Taal gowrervenlal aldivitim TABLE2 2007 2008 4,319,778 3,595,906 4,229,871 6,284,342 6,953,073 t0,256,463 8,512,875 9,065,244 12,124,100 13,472,036 1,446,999 1,157,141 (,426,033 4,299,453 5,797,116 7,526,977 5,752,239 5,906,915 7,736,520 35,323,858 6,003,013 9,101,582 10,006,335 10,511,874 11,097,526 9,658,779 15,265,051 15,494,656 15,163,422 15,522.441 39,212,009 43,384,794 46,129,054 56,719,711 89,166,050 114,211 1,877,291 4,523,146 4,520,173 4,761,581 1,813,993 1,877,291 7,523,146 4,520,173 4,761,581 39,212,009 45,262,085 50,652,200 61,239,884 92,927,631 General govermnent 214,601 253,891 298,749 337,376 445,663 717,849 60,570 9,328 Public safety 2,860,434 2,544,528 2,917,866 4,004,621 4,438,115 4,168,206 2,659,513 2,050,492 Conmvnity services 123,960 170,865 205,806 252,677 252,501 428,947 387,065 374,092 Planning and develapmem 709,013 565,098 611,278 662,737 754,938 1,873,676 169,641 114,211 Public works 1,429,942 1,316,373 1,594,225 1,813,993 2,815,701 1,021,379 2,244,156 1,900,437 Operating )pants and contributions 1,601,716 1,699,255 1,797,031 1,799,503 1,915,518 1,603,171 3,796795 5,905,664 Capital panus and contributions 14,375,463 11,662,424 5,160,405 12,090,141 18,591,421 37918,901 17,601,111 50,090419 Taal gowrervenlal aldivitim program nevenurs 21,315149 18,212,434 12,585,160 20,961,050 _29,233,921 47,732,131 26,918,535 60,463,643 Business -type activities: - Charges for services: GalfCounse - - 1,091,816 3,120,728 1,540,748 3,814,233 Capital panus aid contributions _. . _ - 152,687 Total business -type activities program-nues _,. _ ._: - 1091,876 1,120,728 1,540,748 4,166,920 Total primary govelmnem programresemnes ^d1,315,149 18,212,414 12,585,360 20,961 050 30,325,757 50,852,859 30,459,283 64,610,363 (continued) (cowinawd) (continued) (continued) (continued) (cominuned) (wnlinued) (cominned) Net reverunm (expcnsm): Govenmental activitlm (6,526,600) (15,299,740) (14,911,952) (18,250,959) (14,150,8731 1,603,077 (29,801,176) (27,702,407) Business- activitlm lYpe - (785,4551 (1,702,418) (979,3251 (597,661) Taal rat nmenues(expensm) (6526,600) (15,299,740) (37911,952) (18,250,959) (14,936,128) 200,659 (10,780,6011 (28,297,0683 General revenues and other changes in nes assess: Gmeronental activides Taxes Property taxes 1,162,634 1,450,196 1,800,616 2,198,141 2,579,245 1,679,079 7999,051 6,014.305 Tax increment 15,324,181 18,899,329 21,191,832 24,450,337 24,441,112 35.168,129 42583,031 42,114,993 Salm tax 1,778,581 3,091,588 4,145,381 5,240,017 6,773,566 7,613,075 8,896,716 8,492,213 Transient occupancy taxes 4,249,753 3,967,003 4,036,290 4,261,767 4,831,338 5,417,218 5,448,161 5,127,203 Franchise taxes 625,790 654,696 690,544 895,810 1,185,087 1,044,470 1,259,985 1,748,082 Business license taxa 156,026 168,798 186,220 191,062 251,618 276,917 307,032 117,011 Othertaxes 359,284 311,024 513,934 675,996 1,141,171 1,049,701 872,751 641,705 Motor aehicle in lieu, umCstricled 1,496,620 1,471,217 1,768,091 1,608,151 2,453,642 2,740,233 1,291,055 1,803,647 Investment income 1,578,206 3,006,097 1,353,868 1,738,505 4,736,050 6,319,502 11,853951 10,230,489 Gain(Ioss) on sale of capital assets (21,397) 3,717,470 1,967,292 - 57,146 Miscellaneous 292,016 692,691 513,876 1,389,612 2,397,374 1.943.093 2,052,246 1,220,627 Transfers - - ' (41,459,643) ' (1,137,2031 (874,645) Total ga emme tal activitlm 31,021,115 31,695,242 36,400,652 42,749,418 12,650,136 66,101,726 80,690,516 79,967,521 Business -type activities: Lwesnancmn'o11C - - 553 1,817 4,310 Gain (loss) on sale of capital assets - .. - - (47,721) Transfers - 713459,643 1 1,137,201 ' 874,645 Total business -type activities 41,459,64) 1,137,756 876,462 (41,4113 Total primary govermrem 11023;115 31,695,242 36,400,652 42,749,418 54,109,779 67,239,492 81,566,998 79,924,110 •• Changes in net assets Goverrmeaal activities 24,496,515 18,195,502 1,488,700 24,498,459 (1,500,737) 67,704,803 50,889,360 52,265,114 Busiress-type activities - 40,674,198 (264,662) (102963) (638,072) Total primary gmernmcm S 24,496,515 18,395,502 1,488,700 24,498,459 39,173,451 67,440,141 50,796,397 51,627042 The City of La Quitter implemented GASB 34 far the fiscal year ended June J0, 2001 Information prior ro the implementation afGASB 34 is not available. 1 The transfer mots for lard & golf course inuprmements uaosfered to the Enterprise Fund Source: Cityof La Quinta 129 The City of ter Quinla implemented GASB 34 for the fiscal year endedJune 30, 2001 Source: Cityof La Quinta 130 TA13LE3 CITY OF LA QUINTA Changes in Net Assets - Governmental Activities Last Eight Fiscal Years (accrual basis of accounting) Fiscal Year _ 2001 2002 2003 2004 2005 2006 2007 2008 Expenses: General government $ 3,146,699 3,241,576 3,203,462 4,319,778 3,595,906 4,229,871 6,284,342 6,953,073 Public safety 5,776,628 7,522,532 8,547,005 10,256,463 8,512,875 9,065,244 12,724,100 13,472,036 Community services 940,881 1,411,943 1,321,825 1,446,999 1,157,141 1,426,033 4,299,453 5,797,116 Planning and development 6,146,998 7,110,125 19,083,860 7,526,977 5,752,239 5,906.915 7,736,520 35,323,858 Public works 5,968,911 6,434,239 6,785,759 6,003,013 9,101,582 10,006,335 10,511,874 11,097,526 Interest on long-term debt 5,861,632 7,791,759 8,555,401 9,658,779 15,265,051 15,494,656 15,163,422 15,522,441 Total governmental activities expenses 27,841,749 33,512,174 47,497,312 39,212,009 43,384,794 46,129,054 56,719,711 88,166,050 Program revenues: Charges for services: General government 214,601 253,891 298,749 337,376 445,663 717,849 60,530 8,328 Public safety 2,860,434 2,544,528 2,917,866 4,004,621 4,438,115 4,168,206 2,659,515 2,050,492 Community services 123,960 170,865 205,806 252,677 252,501 428,947 387,065 374,092 Planning and development 709,033 565,098 611,278 662,737 754,938 1,873,676 169,643 134,211 Public works 1,429,942 1,316,373 1,594,225 1,913,993 2,815,703 3,021,379 2,244,156 1,900,437 Operating grants and contributions 1,601,716 1,699,255 1,797,031 1,799,503 1,935,578 3,603,173 3,796,495 5,905,664 Capital grants and contributions 14,375,463 11,662,424 5,160,405 12,090,143 18,591,423 33,918,901 17,601,131 50,090,419 Total governmental activities program revenues 21,315,149 18,212,434 12,585,360 20,961,050 29,233,921 47,732,131 26,918,535 60,463,643 Net program revenues (expenses) (6,526,600) (15,299,740) (34,911,952) (18,250,959) (14,150,873) 1,603,077 (29,801,176) (27,702,407) General revenues and other changes in net assets: Taxes: Property taxes 1,162,634 1,450,196 1,800,616 2,198,141 2,579,245 3,679,079 4,999,051 6,014,305 Tax increment 15,324,183 18,899,329 21,191,832 24,450,337 24,443,112 35,168,329 42,583,031 42,114,893 Sales lax 3,778,583 3,093,588 4,345,381 5,240,037 6,773,566 7,613,075 8,896,716 8,492,213 Transient occupancy taxes 4,249,753 3,967,003 4,036,290 4,261,767 4,831,338 5,437,238 5,448,361 5,327,203 Franchise tax 625,790 654,696 690,544 895,810 1,185,087 1,044,470 1,259,985 1,748,082 Business license taxes 156,026 168,798 186,220 191,062 251,618 276,917 307,032 317,011 Other lax 359,284 311,024 513,934 675,996 1,141,177 1,049,701 872,753 641,705 Motor'vehicle in lieu, unrestricted 1,496,620 1,473,217 1,768,091 1,608,151 2,453,642 2,740,233 3,291,055 3,803,647 Investment income 3,578,206 3,006.097 1,353,868 1,738,505 4,336,050 6,319,502 11,854,951 10,230,489 Gain (loss) on sale of capital assets - (21,397) - - 3,717,470 1,967,292 57,346 Miscellaneous 292,036 692,691 513,876 1,489,612 2,397,474 1,943,093 2,052,246 1,220,627 Transfers - (41,459,643) (1,137,203) (874,645) Total governmental activities 31,023,115 33,695,242 36,400,652 42,749,418 12,650,136 66,101,726 80,690,536 79,967,521 Changes in net assets - governmental activities S 24,496,515 18,395,502 1,488,700 24,498,459 (1,500,737) 67,704,803 50,889,360 52,265,114 The City of ter Quinla implemented GASB 34 for the fiscal year endedJune 30, 2001 Source: Cityof La Quinta 130 CITY OF LA QUINTA Changes in Net Assets - Business -type Activities Last Four Fiscal Years (accrual basis of accounting) Fiscal Year Expenses: Golf Course 1,877,291 2 4,523,146 Total business -type activities expenses 1,877,291 4,523,146 Program revenues: Charges for services: Golf Course 1,091,836 2 3,120,728 Capital grants and contributions - - Total business -type activities program revenues 1,091,836 3,120,728 Net revenues (expenses) (785,455) (1,402,418) General revenues and other changes in net assets: Investment income 553 Gain (loss) on sale of capital assets Transfers 164,190 Capital contributions 41,459,643 973,013 Total business -type activities 41,459,643 1,137,756 Changes in net assets - business -type activities 40,674,188 264,662) The City of La Quinta implemented the business type activities in FY 2004/2005. r 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 Quinta 131 TABLE 4 4,520,173 4,761,581 4,520,173 4,761,581 3,540,748 3,814,233 352,687 3,540,748 4,166,920 (979,425) (594,661) 1,817 4,310 - (47,721) 874,645 979,425 1,855,887 (43,411) 876,462 (638,072) TABLES CITY OF LA QUINTA Fund Balances ofOovemmental Funds Last Eight Fiscal Years (modified accrual basis ofaccounting) Fiscal Year The increase was primarily the result of the issuance of the 2004 Financing Authority bonds Source: Cityof La Quinta 132 2001 2002 2003 2004 2005 2006 2007 2008 General fund: Reserved S 11,746,211 12,897,893 21,099,910 29,210,757 32,412,590 23,210,506 28,388,633 45,441,896 Unreserved 23,878,259 27,981,710 26,584,773 25,494,479 31,514,377 53,058,618 56,251,887 47,010,123 Total general fund S 35,624,470 79 40,8,603 47,684,687 54,705,276 63,926,967 76,269,124 84,640,520 92,452,019 All other governmental funds: Reserved S 13,480,545 45,508,787 38,404,982 98,476,000 99,751,862 95,515,445 31,211,751 11,568,126 Unreserved, reported in: Special revenue funds 6,352,995 12,107,305 9,382,431 9,286,459 19,267,394 36,475,093 27,770,552 32,419,068 Debt service funds (6,800,030) (5,622,884) (6,182,506) (11,099,245) (7,236,054) 738,590 10,634 55,831,061 Capital projects funds 18,712,013 12,423,247 16,368,205 28,600,240 1,831,415 6,499,827 58,370,198 (4,445,109) Total all other governmental funds S 31,745,523 64,416,455 57,973,112 125,263,454 113,614,617 139,228,955 117,363,135 95,373,146 The City of La Quinta has elected to show only eight years of data for this schedule The increase was primarily the result of the issuance of the 2004 Financing Authority bonds Source: Cityof La Quinta 132 Expenditures 54,546,974 114,913,074 CITY OF LA QUINTA 110,757,923 113,284,100 113,493,227 TABLE 6 199,069,689 Current: Changes in Fund Balances ofGovemmental Funds Last Eight Fiscal Years General government Public safety 3,275,624 3,161,596 3,344,407 4,099,376 3,970,921 (modified accrual basis of accounting) 6,150,699 7,367,144 Community services 5,636,154 817,460 7,610,308 1,067,837 8,344,428 993,964 9,672,708 1,025,397 Fiscal Year 13,029,187 15,685,493 17,181,775 Revenues: 2001 2002 2003 2004 2005 2006 2007 2008 Taxes Licenses and permits $ 36,605,534 2,057,423 43,011,931 1,857,691 50,326,811 58,301,082 1,982,127 68,175,347 89,704,947 100,103,324 105,870,933 Charges for services 1,998,589 1,757,744 3,096,145 2,302,759 2,619,578 3,226,167 3,402,602 5,145,430 3,367,989 2,788,882 1,821,794 2,107,035 Developer fees Intergovernmental 2,592,398 2,298,647 3,021,245 5,718,073 6,091,156 12,473,440 5,310,440 1,334,060 6,537,991 Investment income 9,400,340 4,893,919 9,583,451 4,135,009 7,194,521 11,858,627 3,368,709 3,735,984 10,242,876 18,585,468 14,803,971 15,382,135 Contributions 14,355,577 15,554,612 15,059,977 6,215,291 9,946,212 12,692,350 11,297,153 pce Special assessments Rental income 782,610 757,619 780,259 816,045 825,292 - 818,526 - 877,191 37,643,190 909,229 Loan repayments 1,067,076 - 1,001,389 1,094,510 1,118,744 1,20.1,463 1,103,600 1,064,978 1,105,962 Other 502,717 584,197 483,777 1,359,539 2,381,602 528,903 1,621,850 637,054 1,047,020 412,353 471,811 629,471 Total revenues 59,900,606 64,987,678 70,554,718 88,623,817 102,290,699 143,404,516 140,922,303 183,288,970 Expenditures 54,546,974 114,913,074 70,192,981 110,757,923 113,284,100 113,493,227 155,240,087 199,069,689 Current: General government Public safety 3,275,624 3,161,596 3,344,407 4,099,376 3,970,921 4,644,954 6,150,699 7,367,144 Community services 5,636,154 817,460 7,610,308 1,067,837 8,344,428 993,964 9,672,708 1,025,397 12,364,583 13,029,187 15,685,493 17,181,775 Planning and development 6,344,764 10,693,374 7,804,294 7,480,421 1,104,509 5,719,373 1,248,308 5,847,563 4,027,302 28,994,177 5,336,757 15,374,160 Public works Capital projects 2,613,928 14,456,314 2,897,312 57,342,978 3,685,050 16,057,578 4,536,589 43,331,919 6,206,769 6,987,014 6,755,507 6,563,494 Debt service: 90,000,000 40,012,387 25,445,550 36,420,417 82,883,317 Principal retirement Interest and fiscal charges 4,510,420 5,942,929 11,453,487 7,017,016 2,931,952 3,610,538 3,793,660 4,777,748 5,647,940 5,949,311 Payment to bond escrow 17,911,515 (17,911,515) 64,255,590 (65,255,590) 9,469,314 13,961,721 14,355,577 15,554,612 15,059,977 15,424,708 Payments under pass-through obli - 10,949,381 - 13,669,166 - 17,561,994 1,591,107 21,448,147 25,756,321 35,958,291 36,498,575 42,989,023 Total expenditures 54,546,974 114,913,074 70,192,981 110,757,923 113,284,100 113,493,227 155,240,087 199,069,689 Excess (deficiency) of revenues over (under) expenditures 5,353,632 (49,925,396) 361,737 (22,134,106) (10,993,401) 29,911,289 (14,317,784) IS780,719 Other financing sources (uses): Issuance of tax allocation bonds 88,000,000 - 26,400,000 Issuance of revenue bonds 90,000,000 Payment to bond escrow (19,955,000) Transfers in Transfers out 17,911,515 (17,911,515) 64,255,590 (65,255,590) 23,887,256 (23,887,256) 154,613,662 (154,613,662) 49,248,081 (49,248,081) 35,828,335 (35,992,525) 60,954,576 (60,954,576) 88,604,682 Capital leases - (87,342,608) Proceeds from sale ofcapital assets 146,603 - 8,566,295 8,209,396 124,097 182,094 158,061 Total other financing sources (uses) 87,146,603 96,445,000 8,566,295 8,045,206 124,097 1,602,229 Net change in fund balances $ 5,353,632 37,221,207 361,737 74,310,894 $ 2,427,106 37,956,495 14,193,687 14,178,490 Debt service as a percentage of noncapital expenditures 49.1% 54.2% 43.5% 57.9% 62.0% 65.5% 61.0% 47.1% %he City of La Quinta has elected to show only eight years of data for this schedule Source: Cityof La Quinta 133 TABLE 7 CITY OF LA QUINTA Assessed Value and Estimated Actual Value of Taxable Property Last Ten Fiscal Years (in dollars) NOTE: In 1978 the voters of the State of California passed Proposition 13 which limited property taxes to a total maximum rale 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" (lirnited 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 tlae 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 134 Entire Citv (including Redevelopment Agency) Fiscal Year Taxable Ended Less: Assessed Direct Net June 30 Secured Unsecured Exem tions _ Value Tax Rate Taxable Value 1999 2,674,887,437 18,756,736 (38,580,062) 2,655,064,111 1.0000 2,655,064,111 2000 2,665,520,656 18,712,736 (39,914,784) 2,644,318,608 1.0000 2,644,318,608 2001 3,162,945, 116 30,599,753 (50,149,068) 3,143,395,801 1.0000 3,143,395,801 2002 3,789,678,041 32,607,713 (54,726,303) 3,767,559,451 1.0000 3,767,559,451 2003 5,412,382,710 40,940,877 (95,420,075) 5,357,903,512 1.0000 5,357,903,512 2004 6,289,493,552 44,014,548 (113,037,003) 6,220,471,097 1.0000 6,220,471,097 2005 7,856,383,375 72,554,357 (115,071,146) 7,813,866,586 1.0000 7,813,866,586 2006 9,986,151,525 88,740,840 (99,245,721) 9,975,646,644 1.0000 9,975,646,644 2007 11,854,669,637 101,433,002 (89,688,505) 11,866,414,134 1.0000 10,026,178,844 2008 12,410,626,893 113,185,065 (107,777,195) 12,416,034,763 1.0000 11,918,889,134 NOTE: In 1978 the voters of the State of California passed Proposition 13 which limited property taxes to a total maximum rale 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" (lirnited 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 tlae 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 134 135 TABLE 8 CITY OF LA QUINTA Assessed Value and Estimated Actual Value of Taxable Property - Redevelopment Agency Last Three Fiscal Years (in dollars) Redevelo ment A enc Prn"cet 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 (11,604,295) 3,980,078,167 199,398,233 3,780,679,934 2007 5,223,508,114 34,250,061 (36,913,004) 5,220,845,171 199,398,233 5,021,446,938 2008 5,259,271,091 31,678,492 (36,844,457) 5,254,105,126 199,398,233 5,054,706,893 Redevelopment Agency 1'ra.ji.c! Area 2 Fiscal Year Taxable Ended Less: Assessed Base Taxable June 30 Secured UnsecuredExc nitiocs _ 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 2,764,306,278 50,616,017 (40,774,044) 2,774,148,251 95,182,755 2,678,965,496 2008 2,843,981,136 62,180,440 (57,076,727) 2,849,084,849 95,182,755 2,753,902,094 Source: County of Riverside Auditor -Controller 135 Tax Rate Area Overlapping Rates 5 City of La Quints. County of Riverside Riverside County Office of Education Riverside County Pension Obligation Desert Sands Unified Coachella Valley Unified School District Coachella Valley Water District Coachella Valley Recreation & Park District Desert Comm College District Total Overlapping Rate 020-005 020-005 020-005 020-015 020-015 020-089 020-144 020-144 020-144 0.0767 00761 00799 00767 00761 00756 00767 00761 00756 00442 00332 00462 00199 00208 00484 00442 00332 00484 00199 00199 00199 00208 00199 0 0 7 99 01409 01293 01461 01175 01169 01440 Total Direct and Overlapping Rate 1 1401 1 1285 1 1453 1 1175 NOTE: In 1978. California voters passed Proposition 13 which sets the property tax rate at a 1.001/6 fined amount for direct taxes This 1.00°/1 is shared by a8 taxing agencies for which the subject property resides within Source: County of Riverside Auditor Controllers Office I Direct rate from Tax Rate Area (TRA) 020-059 provided by Hdl Coren & Cone and overlapping debt rates from California Municipal Statistics I 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 Statistics 3 Direct rate taken from an analysis by the City of La Quinta Finance Department staff of all TRA's in the Project area and do not include State ERAF deductions and overlapping rates provided by California Municipal Statistics 4 Direct rate taken from an analysis of thel TRA in the Project area and do not include State ERAF deductions and overlapping rates provided by California Municipal Statistics 5 Overlapping rates are based upon a single tax rate area only 136 00199 00199 00199 01409 01293 01440 1 1 169 l 1440 1 1409 1 1293 1 1440 TABLE 9 CITY OF LA QUINTA Direct and Overlapping Property Tax Rates (Rate per $100 of assessed value) Last Three Fiscal Year City Redevelopment Redevelopment Non -Project Area Project Area 1 Project Area 2 2006 1 2007 1 20081 2006 3 2007 3 2008 4 2006 3 2007 3 20084 Direct Rates: City of La Quints. 0.0760 0.0760 00760 00000 00000 00000 00000 0.0000 00000 Redevelopment agency Project Area I 0:0000 00000 0.0000 05830 05880 05150 0.0000 0.0000 00000 Redevelopment agency Project Area 2 0.0000 0.0000 00000 00000 00000 00000 02860 0.2920 02910 County of Riverside 01960 0 1960 0 1960 0..3470 0.3460 03460 03470 03470 03470 County Free Library 00250 00250 00250 0.0010 00010 00010 00010 0 00 [0 00010 County Structure Fire Protection 0.0540 00540 00540 00030 00020 00020 00020 00020 00020 Coachella Valley (CV) Unified School 0.4320 04320 04320 00170 0 0150 0.0020 00000 00000 00020 Desert Sands Unified School 0.0000 00000 00000 00160 00140 00140 02000 0.1980 0 1970 Desert Community College 00700 00700 00700 00030 0.0030 00720 00420 00410 00410 Riverside County Office of Education 0.0380 0.0380 0.0380 00030 0.0030 00190 00230 00220 0.0220 Riverside County Regional Park & Open Space 0.0040 00040 00040 00000 00000 00030 00000 00000 00000 CV Public Cemetery 00032 00032 00032 00000 00000 00000 00000 00000 00000 CV Mosquito 0.0127 0.0127 00127 0 0120 00120 00120 00150 00140 00140 CV Park & Recreation 00192 00192 00192 0.0010 00020 00010 00060 00060 00060 CV Water District 00250 00250 00250 00130 00130 0.0010 00770 00760 00760 CV Resource Conservation 0.0003 00003 0 0003 0 0000 00000 00130 00000 00000 00000 CVWD District 1 Debt Service 0.0118 0 01 18 0 01 18 00000 00000 00000 00000 00000 00000 CV WD Storm Water Unit 0.0320 00320 0 0320 00010 00010 00000 00010 00010 00010 Total Direct Rate 0.9992 0 9992 09992 1 0000 10000 10000 10000 10000 1 0000 Tax Rate Area Overlapping Rates 5 City of La Quints. County of Riverside Riverside County Office of Education Riverside County Pension Obligation Desert Sands Unified Coachella Valley Unified School District Coachella Valley Water District Coachella Valley Recreation & Park District Desert Comm College District Total Overlapping Rate 020-005 020-005 020-005 020-015 020-015 020-089 020-144 020-144 020-144 0.0767 00761 00799 00767 00761 00756 00767 00761 00756 00442 00332 00462 00199 00208 00484 00442 00332 00484 00199 00199 00199 00208 00199 0 0 7 99 01409 01293 01461 01175 01169 01440 Total Direct and Overlapping Rate 1 1401 1 1285 1 1453 1 1175 NOTE: In 1978. California voters passed Proposition 13 which sets the property tax rate at a 1.001/6 fined amount for direct taxes This 1.00°/1 is shared by a8 taxing agencies for which the subject property resides within Source: County of Riverside Auditor Controllers Office I Direct rate from Tax Rate Area (TRA) 020-059 provided by Hdl Coren & Cone and overlapping debt rates from California Municipal Statistics I 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 Statistics 3 Direct rate taken from an analysis by the City of La Quinta Finance Department staff of all TRA's in the Project area and do not include State ERAF deductions and overlapping rates provided by California Municipal Statistics 4 Direct rate taken from an analysis of thel TRA in the Project area and do not include State ERAF deductions and overlapping rates provided by California Municipal Statistics 5 Overlapping rates are based upon a single tax rate area only 136 00199 00199 00199 01409 01293 01440 1 1 169 l 1440 1 1409 1 1293 1 1440 NOTE :The amounts shown above include assessed value data for both the City and the Redevelopment Agency. Source: HdL Coren & Cone 137 TABLE 10 CITY OF LA QUINTA Principal Property Taxpayers Current Year and Nine Years Ago (in dollars) 2008 1999 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 $ 381,086,929 1 3.07% 174,875, t49 l 6.59% TD Desert Development 47,028,524 2 0.38% 18,313,493 3 0.69% Sams Real Estate Trust/Wal Mart 36,819,850 3 0.30% 12,027,516 6 0.45% Village Resort 33,146,143 4 0.27% - Quarry at La Quinta 31,377,029 5 0.25% CNL Desert Resort 26,665,873 6 0.21% Fourth Quarter Properties XLIII 26,491,514 7 0.21% WKL Canyon Ridge Associates 24,531,000 8 0.20% Aventine Development 22,350,100 9 0.18% Apartment at La Quinta Village II LLP 20,194,087 10 0.16% - - Michael T & Lynn C. Goodlett - 39,035,092 2 1.47% KSL Land Corporation 15,223,994 4 0.57% La Quinta Golf Properties - 12,330,019 5 0.46% KSL Hotel Land - 11,508,294 7 0.43% GMS Realty - 10,914,000 8 0.41% Capital Pacific Holdings - 10,786,447 9 0.41% Eagle Hardware & Garden Inc 9,775,100 10 0.37% $ 649,691,049 5.23% 314,789,104 11.85% NOTE :The amounts shown above include assessed value data for both the City and the Redevelopment Agency. Source: HdL Coren & Cone 137 TABLE 11 CITY OF LA QUINTA Property Tax Levies and Collections Last Three 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 Lever Years Amount ofLevy 2006 60,716,047 73,097,360 120.39% 2,092,065 75,189,425 123.84% 2007 79,752,191 74,533,984 93.46% 1,802,076 76,336,060 95.72% 2008 84,100,395 87,804,912 104.40% 3,216,547 91,021,459 108.23% 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. Source: County of Riverside Auditor Controller's Office 138 TABLE 12 Ratios of Outstanding Debt by Type Last Three Fiscal Years (in dollars) Fiscal Year Ended Fiscal Year Ended Fiscal Year Ended 2006 2007 2008 Governmental Activities Reimbursement Agreement Compensated Absences 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 City Hall Lease Revenue Bonds Unamortized Discount and Issuance Costs Total Governmental Business -type Activities Capital Leases Total Business -type activities Total Primary Government $ 328,311 $ 278,311 $ 228,311 608,266 734,055 829,227 5,186,627 4,431,178 3,675,731 1,850,000 1,75 0,000 1,600,000 776,030 643,539 511,048 141,785,000 139,145,000 136,350,000 6,130,000 6,025,000 5,915,000 89,265,000 87,745,000 86,175,000 6,245,000 5,900,000 5,540,000 (877,230) (877,230) (841,087) 251,297,004 245,774,853 239,983,230 1,090,602 825,848 681,048 1,090,602 825,848 681,048 $ 252,387,606 $ 246,600,701 $ 240,664,278 Population - State Department of Finance January l 38,340 41,092 42,958 Number of Households 18,762 20,176 21,058 Median Household Income $ 65,906 $ 67,754 $ 74,683 Percentage of Personal Income 20.41% 18.04% 15.30% Debt Per Capita $ 6,583 $ 6,001 $ 5,602 Notes: Details regarding the City's outstanding debt can be found in the notes to the financial statements. ' The debt service payment for the 2004 Lease Revenue Bonds are made from Redevelopment Project Area l & 2 low & moderate income tax increment. 139 TABLE 13 CITY OF LA QWNTA Ratio of General Bonded Debt Outstanding Last Three Fiscal Years (In Dollars) Outstanding General Bonded Debt Fiscal Year City Hall Lease 2004 Tax Percent of Ended Lease Local Agency Allocation Assessed Per June 30 Obligation Revenue Bonds I Bonds Total Value I Capita 2006 6,245,000 89,265,000 147,9'15,000 243,425,000 2.44% $ 6,349 2007 5,900,000 87,745,000 145,170,000 238,815,000 2.01% $ 5,812 2008 5,540,000 86,175,000 142,265,000 233,980,000 1.88% $ 5,447 General bonded debt is debt payable with governmental fund resources and general obligation bonds recorded in enterprise funds (of which, the City has none). 1 Assessed value has been used because the actual value of taxable property is not readily available in the State of California. Source: City of La Quinta 140 CITY OF LA QUINTA Direct and Overlapping Debt June 30, 2008 City Assessed Valuation Redevelopment Agency Incremental Valuation Total Assessed Valuation Source: Riverside County Auditor Controller Overlapping Debt Repaid with Property Taxes And Assessments: Desert Community College District Coachella Valley Unified School District Desert Sands Unified School District (DSUSD) DSUSD Lease Tax Obligations Coachella Valley County Water District I.D. No. 55 Coachella Valley County Water District I.D. No. 58 DSUSD Community Facilities District No. 1 City of La Quinta 1915 Act Bonds Coachella Valley Water District Assessment District No. 68 Total overlapping debt repaid with property taxes $ 4,607,425,776 7,808,608,987 $ 12,416,034,763 Percentage Applicable 7.438% $ 29.508% 7.836% 7.836% 83.015% 6.809% 100.000% 100.000% 86.247% Overlapping Other Debt including Certifications of Participation (COP) Riverside County General Fund Obligations 1.516% Riverside County Pension Obligations 1.516% Riverside County Board of Education COP 1.516% Coachella Valley Unified School District COP 29.508% DSUSD COP 7.836% Coachella Valley County Water District I.D. No. 71 COP 10.850% Coachella Valley Recreation and Park District COP 12.511% Total overlapping other debt Total overlapping debt City direct debt Total direct and overlapping debt Outstanding Debt 6/30/08 337,870,330 93,982,458 214,839,044 13,590,000 4,590,000 2,160,000 1,945,000 1,705,000 2,255,000 672,936,832 $ 701,562,556 387,995,000 9,275,000 53,830,000 12,420,000 6,390,000 2,510,000 1,173,982,556 TABLE 14 Estimated Share of Overlapping Debt 25,130,795 27,732,344 16,834,787 1,064,912 3,810,389 147,074 1,945,000 1,705,000 1,944,870 80,315,171 10,635,688 5,882,004 140,609 15,884,156 973,231 693,315 314,026 34,523,029 $ 1,173,982,556 114,838,200 240,664,278 $ 355,502,478 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 unit's taxable assessed value that is within the city's boundaries and dividing it by each unit'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 home 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 borne by the residents and businesses should be taken into account. However, this does not imply that every taxpayer is a resident, and therefore responsible for repaying the debt of each overlapping government. Source: California Municipal Statistics, Inc.- overlapping debt Source: City of La Quinta - City Direct debt 141 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 142 TABLE 15 C[TY OF LA QUINTA Legal Debt Margin Infadmation Last Eight Fiscal Years in dollars) Fiscal Year 2001 2002 ` 2003 2004 2005 2006 2007 2008 Assessed valuation S 3,143,395,801 3,767,559,451 5,357,903,512 6,220,471,097 7,813,866,586 9,975,646,644 11,866,414,134 12,416,034,763 Debt limit percentage 15% 15% l5% 15% 15% 15% 15% [5% Debt limit 471,509,370 565,133,918 803,685,527 933,070,665 1,172,079,988 1,496,346,997 1,779,962,120 1,862,405,214 Total net debt applicable to limit: General obligation bonds Legal debt margin S 471,509,370 565,133,918 803,685,527 933,070,665 1,172,079,988 1,496,346,997 1,779,962,120 1,862,405,214 Total debt applicable to the limit as a percentage of debt limit 0.01% 0.0% 0.10% 0.0% 0.0% 0.0% 0.0% 001% 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 142 3 Tax increment revenues from both Project Area l and Project Area 2 Low & Moderate Income Funds are used to pay the annual debt service payments. 143 TABLE 16 t,f7yGlitgs; � 1.54 2.06 1.76 Coverage 6.02 5.30 5.14 Coverage 2.72 2.65 2.81 Coverage 1.00 1.00 1.00 CITY OF LA QUINTA Pledged -Revenue Coverage Last Three Fiscal Years (In Dollars) Tax Allocation Bonds - Project Area t Fiscal Year Ended Tax Less: Other Net Tax Debt Service June 30 Increment Debt Payments Increment 1 Principal Interest 2006 36,506,201 20,638,731 15,867,470 2,500,000 7,805,905 2007 42,029,503 20,820,149 21,209,354 2,640,000 7,658,900 2008 43,476,312 25,383,713 18,092,599 2,795,000 7,500,553 Tax Allocation Bonds - Project Area 2 Fiscal Year Ended Tax Less: Other Net Tax Debt Service June 30 Increment Debt Payments Increment I Principal Interest 2006 19,849,893 17,325,411 2,524,482 100,000 319,168 2007 20,777,158 18,553,875 2,223,283 105,000 314,785 2008 23,087,750 20,929,512 2,158,238 110,000 310,135 2004 Local Agency Revenue Bonds Fiscal Year Ended Tax Less: Other Net Tax Debt Service June 30 Increment 3 Debt Payments Increment Principal Interest 2006 14,089,024 0 14,089,024 735,000 4,436,981 2007 15,701,664 0 L5,701,664 1,520,000 4,402,909 2008 16,641,016 16,641,016 1,570,000 4,356,806 Local Agency Revenue Bonds (City Hall Project) Fiscal Year Ended Lease Less: Other Net Lease Debt Service June 30 Revenue 2 Debt Payments Revenue Principal Interest 2006 680,575 0 680,575 330,000 350,575 2007 678,865 0 678,865 345,000 333,865 2008 675,880 0 675,880 360,000 315,880 Note: Details regarding the city's outstanding debt can be found in the notes to the financial statements. Tax increment has been reduced by other debt payments, which may or may not be subordinated to Tax Allocation Bonds 2 Lease revenues consist of payments from the City General Fund, Civic Center Development Impact Fee Fund and the Redevelopment Agency Capital Projects Fund 3 Tax increment revenues from both Project Area l and Project Area 2 Low & Moderate Income Funds are used to pay the annual debt service payments. 143 TABLE 16 t,f7yGlitgs; � 1.54 2.06 1.76 Coverage 6.02 5.30 5.14 Coverage 2.72 2.65 2.81 Coverage 1.00 1.00 1.00 TABLE 17 CITY OF LA QUINTA Demographic and Economic Statistics Last Three Calendar Years Sources: (1) State of California Department of Finance - January l of each year (2) State of California Economic Development Department website (3) City of La Quinta Building & Safety and Community Development Departments (4) Desert Wheeler's Newsletter -City Overview 144 Calendar Calendar Calendar Year Year Year 2006 2007 2008 City Land (Sq Miles) (3) 35.1 35.1 35.3 l Population (1) 38,340 41,092 42,958 Median Household Income (in dollars) (4) $65,906 $67,754 $74,683 Number of Dwelling Units (3) 18,762 20,176 21,058 Persons per Household (3) 2.855 2.846 2.851 Average Income per person per household $23,084 $23,807 $26,195 Labor Force (2) 14,500 15,300 15,200 Employment (2) 14,100 14,900 14,600 Unemployment Rate (2) 2.76% 2.61% 3.95% Median age (4) 36 36.4 36.4 Sources: (1) State of California Department of Finance - January l of each year (2) State of California Economic Development Department website (3) City of La Quinta Building & Safety and Community Development Departments (4) Desert Wheeler's Newsletter -City Overview 144 CITY OF LA QUINTA Principal Employers Current Year and Nine Years Ago Employer Activity Rank Desert Sands Unified School Distict Government I La Quinta Resort & Club Hotel & Golf Resort 2 Wal-Mart Super Center Retailer 3 Costco Retailer 4 Rancho La Quinta Golf Resort 5 Imperial Irrigation District Public Utility 6 Target Retailer 7 Lowe's Home Improvement' Retailer 8 Stater Brother's Grocery Store 9 Home Depot Retailer 10 Vons Grocery Store 200 City of La Quinta Government Ralphs Grocery Store Total employment listed Total City Employment - July 1 TABLE 18 2007-2008 1998-19991 Percent of Number of Total Number of Employees Employment Employees Rank 2,398 16.42% 525 2 1,550 10.62% 1,500 1 400 2.74% 280 3 207 1.42% 200 1.37% 150 5 200 1.37% 185 1.27% 150 1.03% 125 7 150 1.03% 150 6 147 1.01% 185 4 - 75 8 72 9 - - 65 10 5,587 38.27% 3,127 14,600 Not Available "Total Employment" as used above represents the total employment of all employers located within City limits with over 100 employees Source: 2007-2008 Muniservices, LLC and 1998-1999 City of La Quinta The total City employment and % applicable for 1999 was not available 145 Function Administration City Clerk Finance Community Services Building and Safety Planning and Development Public Works Golf Course CITY OF LA QUINTA Full-time City Employees by Function Last Four Fiscal Years Fiscal Year Ending June 30 2005 8.00 5.00 8.00 8.00 21.00 9.00 23.50 0.50 Fiscal Year Ending June 30 ,)AAA 9.00 5.00 9.00 10.25 22.00 12.00 26.25 0.50 Fiscal Year Ending June 30 2007 10.00 5.00 9.00 10.25 24.00 12.00 26.25 0.50 TABLE 19 Fiscal Year Ending June 30 2008 12.00 6.00 9.00 11.25 25.00 12.00 28.25 0.50 Total 83.00 94.00 97.00 104.00 Source: City of La Quinta NOTE: The City of La Quinta contracts with the County of Riverside for Police Services and with the California Department of Forestry through a contract with the County of Riverside for Fire Services. In addition the City -owned Golf Course is operated by Landmark Golf. These positions have not been included as these positions are not City employees. 146 TABLE 20 CITY OF LA QUINTA Operating Indicators by Function Last Three Fiscal Years Source: City of La Quinta 147 2006 2007 2008 Finance: Number of Active Business Licenses 3,208 3,424 3,690 Number of Animal Licenses Processed 892 1,022 1,272 Number of Accounts Payable Checks Processed 4,696 4,722 4,840 Number of investment purchases 39 73 64 Par value of investments $327,417,000 $392,729,000 $424,500,000 Number of cleared checks 5,081 4,837 5,501 Number of outgoing bank wires 202 158 136 Public Works: Encroachment permits issued 304 218 Ito Request for services 618 419 1152 Building & Safety: Permits: Single family Detached 1,044 526 297 Single family Attached 227 38 0 Residential Pool 866 612 331 Wall/Fence 1,502 963 583 Other 1,607 1,404 1,121 Total Permits 5,246 3,543 2,332 Code Compliance: Animal Control Incidents Handled 1,901 687 2,920 Vehicle abatements 909 296 351 Garage Sale Permits 1,190 1,444 1,519 Weed abatements 141 76 117 Nuisance abatements 1,611 2,032 2,142 Community Services: Library activities: Library Volume 42,050 44,981 66,124 Library books checked out 55,002 99,659 117,738 Library Cards Issued 5,550 5,325 3,675 Number of School Children Visiting Library 745 260 841 Library Volunteer Hours 1,891 1,583 1,951 Senior Center: Number of visits 14,305 12,955 14,013 Senior Center Volunteer Hours 3,481 4,192 3,332 Recreation activities: Participants: Leisure Classes 1,373 1,192 990 Special events 4,668 7,809 8,109 Adult Sports 3,402 6,827 8,550 Golf course: Golf rounds played 38,934 40,548 40,516 Average $ Green fee 71.12 76.97 81.09 Planning and Development: Number of residential units approved 1,063 534 338 Commercial square footage approved 533,726 124,821 342,502 Source: City of La Quinta 147 THIS PAGE INTENTIONALLY LEFT BLANK 150