HomeMy Public PortalAboutLTC 029 - 2015 - 2014 Comprehensive Annual Financial ReportBAL HARBOUR VILLAGE, FLORIDA
COMPREHENSIVE ANNUAL FINANCIAL REPORT
FOR THE FISCAL YEAR ENDED SEPTEMBER 30, 2014
BAL HARBOUR VILLAGE, FLORIDA
COMPREHENSIVE ANNUAL FINANCIAL REPORT
FOR THE FISCAL YEAR ENDED SEPTEMBER 30, 2014
Prepared by the Finance Department
BAL HARBOUR VILLAGE, FLORIDA
TABLE OF CONTENTS
PAGE
INTRODUCTORY SECTION
Letter of Transmittal i-vii
Village Officials viii
Organization Chart ix
FINANCIAL SECTION
INDEPENDENT AUDITORS’ REPORT 1-3
MANAGEMENT’S DISCUSSION AND ANALYSIS (MD&A)
(Required Supplementary Information)
4-14
BASIC FINANCIAL STATEMENTS
Government-Wide Financial Statements
Statement of Net Position 15
Statement of Activities 16
Fund Financial Statements
Balance Sheet – Governmental Funds 17
Statement of Revenues, Expenditures and Changes in Fund Balances –
Governmental Funds
18
Reconciliation of the Statement of Revenues, Expenditures and Changes in
Fund Balances of Governmental Funds to the Statement of Activities 19
Statement of Net Position – Proprietary Fund 20
Statement of Revenues, Expenses and Changes in Fund Net Position – Proprietary Fund 21
Statement of Cash Flows – Proprietary Fund 22
Statement of Fiduciary Net Position – Fiduciary Funds 23
Statement of Changes in Fiduciary Net Position – Pension Trust Funds 24
Notes to Basic Financial Statements 25-63
REQUIRED SUPPLEMENTARY INFORMATION (OTHER THAN MD&A)
Budgetary Comparison Schedule – General Fund 64
Budgetary Comparison Schedule – Tourism Special Revenue Fund 65
Note to Budgetary Comparison Schedules 66
Schedule of Changes in the Village’s Net Pension Liability and Related Ratios –
Employees’ Pension Trust
67
Schedule of Changes in the Village’s Net Pension Liability and Related Ratios –
Police Officers’ Pension Trust
68
Schedules of Employer Contributions –Employees’ Pension Trust 69
Schedules of Employer Contributions –Police Officers’ Pension Trust 70
Schedule of Investment Returns – Pension Trust Funds 71
Schedule of Funding Progress – Excess Benefits Plan 72
Schedule of Funding Progress – OPEB 73
BAL HARBOUR VILLAGE, FLORIDA
TABLE OF CONTENTS
(Continued)
PAGE
COMBINING FUND FINANCIAL STATEMENTS AND SCHEDULE
Combining Balance Sheet – Non-Major Governmental Funds 74
Combining Statement of Revenues, Expenditures and Changes in Fund Balances –
Non-Major Governmental Funds 75
Budgetary Comparison Schedule – Security District Fund 76
Combining Statement of Fiduciary Net Position - Pension Trust Funds 77
Combining Statement of Changes in Fiduciary Net Position – Pension Trust Funds 78
Statement of Changes in Assets and Liabilities – Pending Forfeitures - Agency Fund 79
STATISTICAL SECTION
Net Position by Component 80
Changes in Net Position 81-82
Fund Balances of Governmental Funds 83
Changes in Fund Balances of Governmental Funds 84
Governmental Activities Tax Revenues by Source 85
General Governmental Revenues by Source 86
Assessed Value and Estimated Actual Value of Taxable Property 87
Principal Property Taxpayers 88
Property Tax Levies and Collections 89
Property Tax Rates – Direct and Overlapping Governments 90
Ratios of Outstanding Debt by Type 91
Ratios of Bonded Debt Outstanding 92
Direct and Overlapping Governmental Activities Debt 93
Legal Debt Margin Information 94
Pledged Revenue Coverage, Capital Improvement Revenue Bonds, Series 2011 95
Demographic and Economic Statistics 96
Principal Employers 97
Operating Indicators by Function/Program 98
Capital Asset Statistics by Function/Program 99
REPORTING SECTION
Independent Auditors’ Report on Internal Control over Financial Reporting and on
Compliance and Other Matters Based on an Audit of Financial Statements
Performed in Accordance with Government Auditing Standards
100-101
Management Letter in Accordance with the Rules of the Auditor General of the State of Florida 102-103
Independent Accountants’ Report on Compliance Pursuant to Section 218.415
Florida Statutes 104
INTRODUCTORY SECTION
-viii-
BAL HARBOUR VILLAGE, FLORIDA
VILLAGE OFFICIALS
As of November 2014
MAYOR Martin Packer
ASSISTANT MAYOR Patricia Cohen
COUNCILMEMBER Gabriel Groisman
COUNCILMEMBER Seth E. Salver
COUNCILMEMBER Jaime M. Sanz
VILLAGE MANAGER Jorge M. Gonzalez
INTERIM VILLAGE CLERK Dolores Mejia
FINANCE DIRECTOR Amber Riviere
VILLAGE ATTORNEY Weiss Serota Helfman Pastoriza Cole &
Boniske, P.A.
INDEPENDENT AUDITORS Marcum LLP
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23 -ix-
FINANCIAL SECTION
INDEPENDENT AUDITORS’ REPORT
Marcum LLP n One Southeast Third Avenue n Suite 1100 n Miami, Florida 33131 n Phone 305-995-9600 n Fax 305-995-9601
marcumllp.com
1
INDEPENDENT AUDITORS’ REPORT
Honorable Mayor, Village Council and Village Manager
Bal Harbour Village, Florida
Report on the Financial Statements
We have audited the accompanying financial statements of the governmental activities, the
business-type activities, each major fund, and the aggregate remaining fund information of Bal
Harbour Village, Florida (the Village), as of and for the fiscal year ended September 30, 2014,
and the related notes to the financial statements, which collectively comprise the Village’s basic
financial statements as listed in the table of contents.
Management’s Responsibility for the Financial Statements
Management is responsible for the preparation and fair presentation of these financial statements
in accordance with accounting principles generally accepted in the United States of America;
this includes the design, implementation, and maintenance of internal control relevant to the
preparation and fair presentation of financial statements that are free from material misstatement,
whether due to fraud or error.
Auditors’ Responsibility
Our responsibility is to express opinions on these financial statements based on our audit. We
conducted our audit in accordance with auditing standards generally accepted in the United
States of America and the standards applicable to financial audits contained in Government
Auditing Standards, issued by the Comptroller General of the United States. Those standards
require that we plan and perform the audit to obtain reasonable assurance about whether the
financial statements are free from material misstatement.
An audit involves performing procedures to obtain audit evidence about the amounts and
disclosures in the financial statements. The procedures selected depend on the auditors’
judgment, including the assessment of the risks of material misstatement of the financial
statements, whether due to fraud or error. In making those risk assessments, the auditor
considers internal control relevant to the entity’s preparation and fair presentation of the
financial statements in order to design audit procedures that are appropriate in the circumstances,
but not for the purpose of expressing an opinion on the effectiveness of the entity’s internal
control. Accordingly, we express no such opinion. An audit also includes evaluating the
appropriateness of accounting policies used and the reasonableness of significant accounting
estimates made by management, as well as evaluating the overall presentation of the financial
statements.
2
We believe that the audit evidence we have obtained is sufficient and appropriate to provide a
basis for our audit opinions.
Opinions
In our opinion, the financial statements referred to above present fairly, in all material respects,
the respective financial position of the governmental activities, the business-type activities, each
major fund, and the aggregate remaining fund information of Bal Harbour Village, Florida, as of
September 30, 2014, and the respective changes in financial position and, where applicable, cash
flows thereof for the fiscal year then ended in accordance with accounting principles generally
accepted in the United States of America.
Emphasis of a Matter
As discussed in Note 1 to the financial statements, the Village implemented Governmental
Accounting Standards Board (GASB) Statement No. 67, Financial Reporting for Pension Plans –
an amendment of GASB Statement No. 25. This Statement was implemented for reporting period
ended September 30, 2014. Our opinion is not modified with respect to this matter.
Other Matters
Required Supplementary Information
Accounting principles generally accepted in the United States of America require that the
Management’s Discussion and Analysis and the Required Supplementary Information on pages 4
through 14 and 64 through 73 be presented to supplement the basic financial statements. Such
information, although not a part of the basic financial statements, is required by the
Governmental Accounting Standards Board who considers it to be an essential part of financial
reporting for placing the basic financial statements in an appropriate operational, economic, or
historical context. We have applied certain limited procedures to the required supplementary
information in accordance with auditing standards generally accepted in the United States of
America, which consisted of inquiries of management about the methods of preparing the
information and comparing the information for consistency with management’s responses to our
inquiries, the basic financial statements, and other knowledge we obtained during our audit of
the basic financial statements. We do not express an opinion or provide any assurance on the
information because the limited procedures do not provide us with sufficient evidence to express
an opinion or provide any assurance.
Supplementary and Other Information
Our audit was conducted for the purpose of forming opinions on the financial statements that
collectively comprise the Village’s basic financial statements. The combining fund financial
statements and schedule and the introductory and statistical sections are presented for purposes
of additional analysis and are not a required part of the basic financial statements.
3
The combining fund financial statements and schedule are the responsibility of management and
were derived from and relate directly to the underlying accounting and other records used to
prepare the basic financial statements. Such information has been subjected to the auditing
procedures applied in the audit of the basic financial statements and certain additional
procedures, including comparing and reconciling such information directly to the underlying
accounting and other records used to prepare the basic financial statements or to the basic
financial statements themselves, and other additional procedures in accordance with auditing
standards generally accepted in the United States of America. In our opinion, the combining
fund financial statements and schedule are fairly stated, in all material respects, in relation to the
basic financial statements as a whole.
The introductory and statistical sections have not been subjected to the auditing procedures
applied in the audit of the basic financial statements, and accordingly, we do not express an
opinion or provide any assurance on them.
Other Reporting Required by Government Auditing Standards
In accordance with Government Auditing Standards, we have also issued our report dated
February 13, 2015 on our consideration of the Village's internal control over financial reporting
and on our tests of its compliance with certain provisions of laws, regulations, contracts, and
grant agreements and other matters. The purpose of that report is to describe the scope of our
testing of internal control over financial reporting and compliance and the results of that testing,
and not to provide an opinion on internal control over financial reporting or on compliance. That
report is an integral part of an audit performed in accordance with Government Auditing
Standards in considering Village’s internal control over financial reporting and compliance.
Miami, FL
February 13, 2015
MANAGEMENT DISCUSSION AND ANALYSIS
MD&A
4
MANAGEMENT’S DISCUSSION AND ANALYSIS
Bal Harbour Village, Florida (the Village) discussion and analysis is designed to (a) assist the
reader in focusing on significant financial issues, (b) provide an overview of the Village’s financial
activity, (c) identify changes in the Village’s financial position (its ability to address the next and
subsequent year challenges), (d) identify any material deviations from the financial plan (the
approved budget), and (e) identify individual fund issues or concerns.
Since the Management's Discussion and Analysis (MD&A) is designed to focus on the current
year's activities, resulting changes and currently known facts, please read it in conjunction with the
Village’s financial statements (beginning on page 15).
Financial Highlights
Bal Harbour Village finished its fiscal year with improvements in all of its budgeted funds. The net
position of the Village improved and, in budgeted funds, revenues exceeded expenditures or
expenses. Property tax values were much improved as the economy improved and demand
increased for properties within the Village. Additions to the property tax base from new
construction again provided additional revenues to the Village without increasing the property tax
rate. The Village continued to undertake infrastructure improvements that will continue into the
foreseeable future. Resort taxes showed continued improvements with year-over-year growth.
Redevelopment of another beachfront property was commenced and we expect to add to the
property tax base once it is completed. Highlights for the year include:
The total net position of the Village at the close of fiscal year 2014 was $38.3 million (net
position), an increase of $4.6 million from the prior year. Governmental activities accounted for
$3.6 million of this increase while the Business-type activities accounted for $965 thousand.
Increases in cash and capital assets accounted for the majority of the increase in the
Governmental Funds. The Tourism fund ended the year with an increase of about $672
thousand. The Security District fund saw a $185 thousand improvement to its bottom line as
assessment revenues were levied to provide working and emergency capital. This fund further
reduced its assessments in FY2015. Overall, the Village’s funds saw noticeable improvements
in all areas except the Law Enforcement Trust Funds, where expenditures of about $60 thousand
were recorded and paid for with revenues collected in prior periods.
Out of the total net position, $19.9 million of unrestricted assets may be used to meet the
government's ongoing obligations to citizens and creditors. Additionally, the Village had $12.4
million in capital assets, net of related debt and accumulated depreciation. These assets are
recorded at historical cost. The Village continues to replace its entire underground
infrastructure and will be using a variety of funding options, including bond proceeds, for these
improvements. The current infrastructure is more than 70 years old in some cases.
The Village had more than $27.3 million in current assets than it had in current liabilities,
demonstrating the Village’s solid ability to meet its current obligations. The Village’s long-
term obligations consist of long- term debt, leave-time owed current employees, an unfunded
excess benefit plan owed employees, other post employment benefits (entirely for retiree health
care) owed employees, and debt issued for the purpose of replacing the Village’s underground
infrastructure. These total long-term liabilities totaled a little over $10.3 million and were about
$856 thousand less than the prior year.
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The Village’s General Fund had $10.9 million in unassigned fund balance, which represents
84% of the General Fund expenditures for the same period, or about 11 months worth of
operating reserves, about 2 months more than the prior year. The increase is largely attributed
to additional revenue collected in the current fiscal year, both from recurring and non-recurring
sources such a developer contributions.
General Fund revenues increased by about $2.3 million from fiscal year FY2013. Most notable
of the recurring revenue increases are $72 thousand in Utility Tax, $160 thousand in Franchise
Fees, $132 thousand in Intergovernmental Revenue including Communications Services Taxes,
State Revenue Sharing, and Sales Taxes, and $605 thousand in Building and Permitting revenue
with $423 thousand for Building Permits, a direct reflection of improvement in our local
economy, and $161 thousand in Local Business Tax collections due to improved collection
efforts. In addition, $183 thousand in police off-duty revenue, $98 thousand in COBRA
insurance payments from retirees; both with an offsetting expense. Developer contributions
comprised the non-recurring portion of revenue growth at $965 thousand.
General Fund total expenditures decreased by over $294 thousand compared to FY2013, largely
due to reductions in capital outlay expenses which occurred in liability accounts in the previous
year, operating expenditures increased by over $313 thousand largely due to revenue generated
expenses such as those for off-duty police requests and the red light camera program.
The Village’s Tourism Fund had revenues in excess of expenditures by $631 thousand, largely
due to reduced tourism related expenditures on hold for the launch of the Village’s new
branding effort and advertising creative.
The Village resolved its financial issues with the U.S. Department of Justice (USDOJ) regarding
its operation of a task force that had brought in several million dollars to the Village in prior
years’, the criminal investigation was concluded without any additional fiscal impact to the
Village. Further, the Village has now been admitted back into the Federal Forfeiture program in
good standing.
Business-type activities (the Village’s Water and Sewer fund) operating revenues decreased
from the prior year by $61 thousand. This reflects one-time credits issued due to
malfunctioning Village meters rather than a reduction in consumption. Operating expenses
decreased by about $155 thousand. This decrease resulted more from one-time repairs and
engineering costs for maintenance on the system than from any permanent change in expense
structure. The fund ended the year with about a $965 thousand increase in the net position.
Village Highlights
The Village’s intergovernmental revenue increased by $141 thousand, licenses and permit
revenue increased by $594 thousand. This is a very positive improvement reflecting the
continued improvement experienced by the ongoing economic recovery.
Planning for comprehensive Utility improvements continued during the year with the
completion of the Utility Master Plan for the Village, and we anticipate construction
commenced in the current fiscal year to continue for the next several years. Virtually all of the
Village’s underground water and sewer infrastructure, as well as its stormwater systems, will be
replaced. Roadway systems will also be improved as the underground work is completed.
6
The Security District added to its contingency reserves and working capital needs for the second
straight year. The annual assessments were once again lowered for FY2015.
The Village continues to study ways to reduce its pension costs and obligations and the Village
expects to make plan changes in the next collective bargaining cycle with the police bargaining
unit.
Overview of the Financial Statements
The financial statements focus is on both the Village as a whole (government-wide) and on the
major individual funds. Both perspectives (government-wide and major fund) allow the user to
address relevant questions, broaden a basis for comparison (year to year or government to
government) and enhance the Village’s accountability.
Government-wide Financial Statements
The Government-wide financial statements (see pages 15 and 16) are designed to be corporate-like
in that all governmental and business-type activities are consolidated into columns that add up to a
total for the Primary Government. The focus of the Statement of Net Position is designed to be
similar to bottom line results for the Village and its governmental and business-type activities. This
statement combines and consolidates government funds' current financial resources (short-term
spendable resources) with capital assets and long-term obligations.
The Statement of Activities (see page 16) is focused on both the gross and net cost of various
activities (including governmental, including component units and business-type) that are supported
by the government's general tax and other revenues. This is intended to summarize and simplify the
user's analysis of the cost of various governmental services and/or subsidy to various business-type
activities and/or components.
The Government Activities reflect the Village’s basic services, including general government,
police, solid waste, roads and streets, parks and recreation, and tourism. Property taxes, franchise
and utility taxes, intergovernmental revenue, special assessments, and tourism revenue finance the
majority of these services. The Business-type Activities reflect private sector type operations
(Water and Sewer) where the fees for service typically cover all or most of the cost of operation,
including depreciation.
Fund Financial Statements
Traditional users of government financial statements will find the Fund Financial Statement
presentations more familiar. The focus is on Major Funds, rather than the previous model's fund
types.
The Government's Major Fund (see pages 17 to 22) presentation is presented on a sources and uses
of liquid resources basis. This is the manner in which the financial plan (the budget) is typically
developed. The flow and availability of liquid resources is a clear and appropriate focus of any
analysis of a government. Funds are established for various purposes and the Fund Financial
Statements allow the demonstration of sources and uses and/or budgeting compliance associated
therewith.
7
The Fund Financial Statements also allow the government to address its Fiduciary (or Trust) and
Agency Funds (see pages 23 and 24) by type (employee retirement funds and pending forfeiture
funds). While these Funds represent trust or agency responsibilities of the government, these assets
are restricted in purpose and do not represent discretionary assets of the government. Therefore,
these assets are not presented as part of the Government-wide Financial Statements and are not
considered generally available to the Village to use for any other purpose.
While the Business-type Activity – Enterprise column on the Business-type Fund Financial
Statements (see pages 20 to 22) is the same as the Business-type Activities column on the
Government-wide Financial Statement, the Government Major Funds Total column requires a
reconciliation because of the different measurement focus (current financial resources versus total
economic resources) which is reflected on the page following each statement (see pages 17 and 19).
The flow of current financial resources will reflect interfund transfers and other financial sources, as
well as capital expenditures. The reconciliation will eliminate these transactions and incorporate
the capital asset and long-term obligations into the Government Activities column (in the
Government-wide statements).
GOVERNMENT-WIDE STATEMENTS
Statement of Net Position
The following table reflects the condensed Statement of Net Position:
Percent
2014 2013 2014 2013 2014 2013 Change
Current and other assets 22,088$ 17,350$ 12,102$ 12,603$ 34,190$ 29,953$ 14.15%
Capital assets 10,486 10,745 6,566 5,858 17,052 16,603 2.70%
Total assets 32,574 28,095 18,668 18,461 51,242 46,556 10.07%
Current and other liabilities 1,108 813 689 958 1,797 1,771 1.47%
Non-current liabilities 2,739 2,613 7,954 8,443 10,693 11,056 -3.28%
Total liabilities 3,847 3,426 8,643 9,401 12,490 12,827 -2.63%
Deferred Inflows of
Resources 492 - - - 492 - 100.00%
Net investment in
capital assets 10,541$ 10,745$ 1,914$ 604$ 12,455$ 11,349$ 9.75%
Restricted 5,830 5,065 - - 5,830 5,065 15.10%
Unrestricted 11,864 8,859 8,110 8,456 19,974 17,315 15.36%
Total net position 28,235$ 24,669$ 10,024$ 9,060$ 38,259$ 33,729$ 13.43%
Activities Activities Total
Governmental Business-type
A large portion of the Village’s net position reflects its investment in capital assets (e.g., land,
buildings, and equipment). The Village uses these capital assets to provide services to the citizens;
consequently, these assets are not available for future spending. An additional, but relatively minor,
portion of the Village’s net position represents resources that are subject to external restrictions on
how they may be used (restricted assets).
8
The Unrestricted balance is intended to be a corporate-style measurement of well being (or a bottom
line) for the Village and its related governmental and business-type activities.
Statement of Activities
The following table reflects the condensed statement of activities:
Percent
2014 2013 2014 2013 2014 2013 Change
Revenues:
Program revenues:
Charges for services 3,991$ 3,357$ 3,547$ 3,351$ 7,538$ 6,708$ 12.4%
Operating grants and contributions 243 - - - 243 - 0.0%
Capital grants and contributions 194 115 - 260 194 375 -48.3%
General revenue:
Taxes 13,628 12,157 - - 13,628 12,157 12.1%
Other 56 113 6 20 62 133 -53.4%
Total revenues 18,112 15,742 3,553 3,631 21,665 19,373 11.8%
Expenses:
General government 4,144 3,859 - - 4,144 3,859 7.4%
Public safety 5,740 5,608 - - 5,740 5,608 2.4%
Solid waste and open space 614 613 - - 614 613 0.2%
Tourism 2,904 3,121 - - 2,904 3,121 -7.0%
Roads, streets and parks 1,196 1,179 - - 1,196 1,179 1.4%
Interest on long-term debt 8 8 - - 8 8 0.0%
Water and sewer - - 2,529 2,800 2,529 2,800 -9.7%
Total expenses 14,606 14,388 2,529 2,800 17,135 17,188 -0.3%
Changes in net position before transfers 3,506 1,354 1,024 831 4,530 2,185 107.3%
Transfers 60 60 (60) (60) - - 0.0%
Changes in net position after transfers 3,566 1,414 964 771 4,530 2,185 107.3%
Net position - beginning 24,669 23,255 9,060 8,289 33,729 31,544 6.9%
Net position - ending 28,235$ 24,669$ 10,024$ 9,060$ 38,259$ 33,729$ 13.4%
Governmental Business-type
Activities Activities Total
Normal Impacts
There are several basic (normal) impacts on revenues and expenses as described below:
Revenues
Overall Economic Condition. This can reflect a declining, stable or growing economic
environment and has a substantial impact on property, tourism, and other tax revenue as well as
redevelopment efforts made by the development community. The Village is exposed to risks
associated with tourism. Declines in tourism can adversely affect dollars available to the
Village for marketing and parks, roads, and streets. Declines in tourism can result in reduced
property values to the Village, which would result in lower property tax dollars. Likewise, a
poor economy can also negatively impact the Village’s property tax base. The Village has a
handful of large properties that could stagnate or decline under certain economic conditions.
The effect on the Village would be disproportionately leveraged. Management believes the
Village can weather most short-term economic scenarios.
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Increase/Decrease in Council Approved or State-Mandated Tax Rates and Assessments.
The Village Council can raise or lower its various tax rates and special assessment levels. These
rates have a direct relationship to the Village’s revenue streams. Volatility in tax rates can be
detrimental to business owners and homeowners, making their properties less attractive to own.
The Village has a stable taxation policy. The FY2014 millage rate of 1.9192 is the second
lowest in Miami-Dade County and well below the statutory cap of 10 mills.
Reliance upon Intergovernmental Revenue. The Village received approximately $814
thousand dollars in recurring revenue from other governments during FY2014. Since the Village
does not directly control the levy or collection of these revenues, it is exposed to the risk that
those revenues will not grow or even be available in future years. The loss of these revenues
would likely require the Village to raise more money through higher local taxing efforts. The
Village has the capacity to raise its tax rates to more than offset the loss of these other
governmental revenues.
Undiversified Tourism Tax Base. The Village receives about 53% of its Tourism funding
from one hotel. The loss of the hotel would significantly and adversely affect the operations of
the Village’s marketing and tourism efforts. The Village’s finances are not totally dependent
upon tourism, but anything that materially affects tourism, such as a severe recession or natural
disaster, could adversely affect the Village’s revenues and put pressure on the Village to levy
higher tax rates. When tourism declines, commercial property values also tend to decline.
Limits on Annual Assessments for Homestead Properties. Florida’s Constitution restricts
residential homestead assessment growth to 3% per year, or less, on each home that has a
homestead exemption. Commercial properties are limited to a maximum 10% annual increase
on their assessment and they are not generally provided any exemptions from assessment. The
Village is overwhelmingly residential in nature, but is fortunate to have a number of residential
units that are not subject to this annual limitation. Further, the value of the homes that are
subject to the annual assessment cap is substantial and the Village does not suffer from a limited
tax base growth to the extent other Florida municipalities might. However, the Village may be
exposed to changes in the manner with which annual assessments are valued or the limit to
which they may be taxed.
Expenses
Public Safety expenses account for about 43% of the Village’s General Fund expenditures.
South Florida municipalities face constant pressure to remain competitive with the salary and
benefits paid to sworn police personnel. The costs of maintaining competitive pay packages
have a growth rate that exceeds that of the revenue growth rate. This will continue to place
pressure on the Village’s budget. Additionally, the Village traditionally affords all employees
benefits similar in nature to those provided to Police employees.
The Village provides water and sewer services to its residents and businesses. The Village buys
water and transmits wastewater for further treatment under large-user agreements with other
units of government. The Village cannot negotiate from a position of strength for these services
and is largely at the mercy of the service provider. Increased operating costs, pass through rate
increases from wholesale service providers, combined with the additional debt service expense
associated with capital improvements, make additional rate increases likely.
10
Solid Waste Disposal. The Village collects money from its property owners through special
assessments to pay for the cost of collection and disposal of solid waste from its residents. On
May 1, 2012, the Village outsourced its solid waste operation, which resulted in a significant
savings that will be reflected in lower assessments for future years. These costs are guaranteed
and fixed for the next five years. Beyond that period of time, additional costs could occur.
Environmental Risks. The Village is located between an intracoastal waterway and the Atlantic
Ocean and is exposed to significant risks caused by weather, particularly hurricanes. In addition
to the potential damage to structures and infrastructure, substantial loss of beach can occur
during hurricanes. Because a significant portion of the Village’s attraction is its beachfront
area, the loss of the beach, even if only temporary, could result in significant loss of revenue to
the Village.
Current Year Impacts
Revenues
Intergovernmental revenues inclusive of sales and service taxes, and those generate from building
and permitting fees increased significantly over the prior year, reflecting the continued economic
recovery. The Village has maintained one of the lowest property tax rates in South Florida.
Resort taxes showed improvement over the prior year and this trend is expected to continue into the
future with the opening of two new venues in the current year, and the additional of the Ritz Carlton
to the Village’s resort lineup. The revenue generated by the resort tax levies helps the Village keep
its property tax rates low.
Security District assessment rates were decreased during FY2014 and the current year. This fund is
on solid financial footing.
Expenses
The Village continued to experience increases in existing retirement costs, but is taking action
through the collective bargaining process to reduce those costs by exploring changes to the
retirement plans of both the police and general employees. Other Post Employment Benefits,
which, for the Village, are limited to healthcare costs, continue to increase. Under state law, the
Village is required to allow its retirees to continue their health care coverage provided the retirees
pay the full premium. This results in an “implied subsidy” to older, and generally sicker,
participants. The Village also allows (through a collective bargaining agreement with its police
officers) police retirees to receive a monthly health insurance stipend of $350. The expense
represents a cost of about 6% of payroll.
Increases in rates from both Miami-Dade County and the City of Miami Beach resulted in increased
expenses in the Water and Sewer fund, and additional pass-through rate increases are anticipated in
future years.
The Village will increase expenditures for Capital projects in the coming years as it begins
construction and implementation of the Utility Master Plan.
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THE VILLAGE FUNDS
Governmental Funds
As of the year-end, the Governmental Funds (as presented on the balance sheet) reported a
combined fund balance of $19.2 million, which was a 23% increase or $3.7 million more than the
previous year. $787 thousand of this increase came from positive results in restricted special
revenue funds while about $2.9 million came from General Fund operations.
The General Fund ended the year with $13.7 million of fund balance that was $2.9 million more
than FY2013, or an increase of 26%.
The Tourism Fund ended the year with an approximate $3.4 million fund balance, an increase of
$631 thousand, which was a 24% improvement over the prior year.
The Village maintains other government funds for forfeitures and security district operations, but
those operations are not considered core to the Village’s financial operations. The State Law
Enforcement Trust Fund had nominal activity in FY2014, and the Federal Law Enforcement Trust
Fund had none.
Enterprise Fund
The Water and Sewer Fund ended the year with about $10.0 million in Net Position, an increase of
$965 thousand. Capital Assets continued to see improvements made to its underground systems and
net position increased by about $707 thousand, up 12% from the prior year.
Budgetary Highlights
The Village did not amend its initially adopted budgets during the year and we note that the
following notable budgetary highlights occurred during FY2014:
The Village’s General Fund finished FY 2013-14 with $1.928 million more in operating revenues
than operating expenditures. Revenue exceeded budget by $1.78 million while total expenses ended
under budget by $.14 million (accounting for increased expenditures resulting from higher revenue,
such as Building Permit fees and Red Light Camera citations).
General Fund operating expense ended $144,000, below FY 2013-14 Adopted Budget levels. It is
worth noting that the expenditures included $468,000 in unbudgeted expenditures driven by higher
corresponding revenues, such as Building Contractual services ($305,000); Off-Duty Police
($89,000); and Red Light Camera Program ($74,000). If netted out, the expenses under direct
management control would have ended $612,000 under budget, or almost 5.5% under the approved
spending levels.
The expenses for the Legislative Department, are $69,000 less than budgeted (-49.60%), largely
due to less than anticipated professional service (-$20,000), and management expenses (-
$33,000).
The Administration Department expenses are $82,000 less than budgeted (-8.52%), largely due
retirement expenses (-$28,000), and election expenses (-$39,000) which were significantly less
than budgeted. Departmental expenditures were less than budgeted in spite of unbudgeted
12
expenses for the retired former Village Manager’s Excess Benefit Plan occurring within the
department ($56,000).
The Finance Department expenses are $188,000 less than budgeted (-26.87%), largely due to
salary savings resulting from a delayed start date and reduced starting salary for the Director (-
$90,000), and retirement expenses which were also less than budgeted (-$65,000).
The expenses for the General Government Department expenses are $146,000 less than
budgeted (-15.28%), largely due to reduced Professional Services expenses (-$55,000), and
maintenance expenses (-$33,000) which are less than budgeted. Overall expenses were less
than budgeted in spite of reflecting unbudgeted COBRA/retiree expenses within the department
for the first time, these expenses are offset by payments made by retirees to the Village.
The actual expenses for the Police Department are $425,000 more than budgeted (8.31%),
largely a result of unbudgeted expenditures for the Red Light Camera Program and Off-Duty
requests, due to increased activity offset by corresponding revenue. Both programs resulted in
net revenue generation for the Village. In addition, the then Vacant Chief of Police position was
funded for only 6 months rather than a full year. Finally, certain personnel actions taken during
the year resulting in extended suspensions with pay pending the outcome of an investigation,
causing the overtime line item to exceed budget this Fiscal Year.
The actual expenses for the Building Department are $315,000 more than budgeted (55.82%),
due to increased building and permitting revenue a percentage of which is paid to the
contractual service provider for the department.
The Public Works Department expenses are $243,000 less than budgeted (-13.12%), largely due
to the proper redirecting of Utility Master Plan development expense to the Utility Fund, and
Resort Tax eligible expenses to the Resort Tax Fund.
The actual expense for the Parks and Recreation Department are $54,000 more than budgeted
(16.11%), largely due to the use of overtime, and increased hours for part-time employees to
meet operational needs.
The expense for General Fund Legal are $209,000 less than budgeted (-54.8%), the FY2014
budget for legal was higher than prior year expense would indicate was needed. When
compared to prior year actual legal FY 2013-14 expenditures are $34,000 less than FY 2012-13
expenses for the same time period.
The Tourism Fund finished the year with $631 thousand more in revenues than expenditures.
Increases in year-over-year sales were seen and the marketing efforts of the Village deserve much
of the credit.
Overall, the Village’s budgetary performance was very positive.
CAPITAL ASSETS AND DEBT ADMINISTRATION
Capital Assets
As of year-end, the City had $17.0 million invested in a variety of capital assets, an increase of $470
thousand from FY2013. Except for $7,000 in historical land costs, the remaining assets are or will
be depreciated over time on the government-wide and proprietary financial statements.
For additional information on the Village’s capital assets, see Note 6 on Pages 38-39.
13
Debt Outstanding
The Village had $10.3 million in outstanding long-term obligations, of which $856 thousand is due
during FY2014 and is comprised of accrued compensated balances and payment of the debt issued
in prior years. Total outstanding long-term obligations decreased by $700 thousand. The current
portion of all debt was budgeted for in the FY2015 operating budgets of the Village. The General
Fund portion of the debt service has been restricted in the Fund Balance on the Balance Sheet of the
Governmental Funds.
For additional information on the Village’s long-term debt, see Note 8 on Pages 39-41
Net Pension Liability
With the implementation of GASB Statement No. 67, a new measure of the accounting liability of
the employer is referred to as the Net Pension Liability and is measured as of the Plan's year end
and is presented in the required supplementary information.
ECONOMIC FACTORS AND NEXT YEAR’S BUDGET
In the conduct of its ordinary operations, various lawsuits, commitments, and contingencies will
arise. Disclosure of these items appear starting on pages 61-62 in the notes to this report.
Florida has many limiting measures on residential property taxes. All affect the Village. The first
$25,000 of assessed values is exempt from taxation on homestead property. Further, homeowners
over age 65 and who have income less than $20,000 are able to avoid taxes on the next $25,000 of
assessed value. Florida’s Constitution also limits the assessed value on homestead property to a
maximum increase of 3% per year, or less if inflation is less. Commercial property is limited to a
maximum 10% increase in assessed value per year.
The Village’s collective bargaining agreement with its police union is expiring and is currently
being renegotiated. The Village’s personnel benefit costs have outpaced its tax base growth,
excluding new construction.
The Village has a very desirable brand and attracts high value tax base investment. Currently, an
ocean front parcel is under redevelopment and the Village expects this project to increase its tax
base by at least $450 million. Much of the condominium market in the Village does not have
homestead exemption and thus enjoys a higher rate of growth. The Bal Harbour Shops is an
international destination-shopping venue and is planning for expansion. It is the Village’s largest
commercial taxpayer and the businesses that locate within the Shops tend to have large retail
inventories that are also taxed by the Village. Construction on the Consultatio has begun and is
expected to be on the tax rolls for FY2016.
The Village’s tax base is very heavily weighted to the residential market and is not very diversified
otherwise. This exposes the Village to the movements of fewer markets that can lead to more
volatility in the tax base of the Village. This has sometimes been mitigated by the property tax base
growth limitations that can “recapture” limited tax base growth in prior years. Also, because Bal
Harbour residential properties tend to be at the high end of the market, recoveries have historically
been faster than for the residential market as a whole.
14
The Village’s adopted FY2015 budget totaled $28.8 million for all funds. The Security District
assessment rate was reduced because it has now built up sufficient reserves and working capital.
Water and sewer rates were increased, to pass through increases from our wholesale service
providers and to eliminate the General Fund subsidy to the Utility, from $4.15/1,000 to $4.55/1,000
gallons of water consumed with a 3,000 gallon minimum monthly charge for Water and from
$6.60/1,000 to $7.30/1,000 gallons of water consumed with a 3,000 gallon minimum monthly
charge for Waste Water.
The Village has completed the update of the Utility Master Plan, and will commence the
replacement of its underground utilities, including water, wastewater, and storm water services.
Because of the extensive amount of work that will be undertaken, residential roadways will also
need to be reconstructed. The expected cost of this work is currently estimated at $28.8 million.
This work is expected to be financed with water and sewer fund reserves, existing debt proceeds,
State Appropriation Funding and County General Obligation Bond Proceeds revenue sources, and
expected future borrowings. Water and sewer rates may also be affected. Potential impact to the
General Fund is still being investigated, but we don’t expect it to affect the Village’s local tax
effort.
The Village was benefitting from a beach renourishment program that will widen the beaches
throughout the Village. The project is expected to be completed in FY2015. This should have a
positive impact on both tourism taxes and property values.
FINANCIAL CONTACT
The Village’s financial statements are designed to present users (citizens, taxpayers, customers,
investors and creditors) with a general overview of the Village’s finances and to demonstrate the
Village’s accountability. If you have any questions about the report or need additional financial
information, contact the Village’s Finance Director at City Hall 655 96th Street, Bal Harbour
Village, Florida 33154, telephone (305) 866-4633.
BASIC FINANCIAL STATEMENTS
Business-
Governmental type
Activities Activities Total
ASSETS
Cash and cash equivalents 19,661,223$ 7,978,319$ 27,639,542$
Receivables, net 763,624 420,457 1,184,081
Prepaids 3,199 - 3,199
Due from other governments 54,441 400,287 454,728
Net pension asset - defined benefit plans 1,245,109 - 1,245,109
Restricted assets:
Cash and cash equivalents 360,775 3,189,244 3,550,019
Restricted for customer deposits - 114,532 114,532
Capital assets not being depreciated 1,710,099 2,731,975 4,442,074
Capital assets being depreciated, net 8,776,235 3,833,305 12,609,540
Total assets 32,574,705 18,668,119 51,242,824
LIABILITIES
Accounts payable and accrued liabilities 1,107,935 688,942 1,796,877
Payable from restricted assets:
Customer deposits - 114,532 114,532
Non-current liabilities:
Due within one year 284,821 611,272 896,093
Due in more than one year 449,010 7,228,447 7,677,457
Net pension obligation - excess benefit plan 1,399,473 - 1,399,473
Other post employment benefits 606,273 - 606,273
Total liabilities 3,847,512 8,643,193 12,490,705
DEFERRED INFLOWS OF RESOURCES
Business taxes 491,978 - 491,978
NET POSITION
Net investment in capital assets 10,540,631 1,914,805 12,455,436
Restricted for:
Debt service 306,477 - 306,477
Tourism development 3,359,847 - 3,359,847
State law enforcement 1,086,638 - 1,086,638
Security district 1,077,254 - 1,077,254
Unrestricted 11,864,368 8,110,121 19,974,489
Total net position 28,235,215$ 10,024,926$ 38,260,141$
BAL HARBOUR VILLAGE, FLORIDA
STATEMENT OF NET POSITION
SEPTEMBER 30, 2014
The accompanying notes are an integral part of these financial statements.
15
BAL HARBOUR VILLAGE, FLORIDACharges Operating Capital Business-for Grants and Grants and Governmental typeFunctions/ProgramsExpensesServicesContributionsContributionsActivitiesActivitiesTotal Governmental activities: General government 4,143,524$ 3,086,654$ 243,000$ -$ (813,870)$ -$ (813,870)$ Public safety 5,739,694 904,073 - - (4,835,621) - (4,835,621) Solid waste 613,773 - - - (613,773) - (613,773) Roads and streets 807,887 - - 193,847 (614,040) - (614,040) Parks and recreation 389,739 - - - (389,739) - (389,739) Tourism development 2,903,643 - - - (2,903,643) - (2,903,643) Interest on long-term debt 7,675 - - - (7,675) - (7,675) Total governmental activities 14,605,935 3,990,727 243,000 193,847 (10,178,361) - (10,178,361) Business-type activities: Water and sewer2,527,403 3,547,076 - - - 1,019,673 1,019,673 Total business-type activities 2,527,403 3,547,076 - - - 1,019,673 1,019,673 Total 17,133,338$ 7,537,803$ 243,000$ 193,847$ (10,178,361) 1,019,673 (9,158,688) General revenues: Property taxes 6,781,637 - 6,781,637 Franchise fees based on gross receipts 810,291 - 810,291 Utility taxes 878,330 - 878,330 Communications services tax 316,580 - 316,580 Unrestricted developer contribution 965,561 - 965,561 Unrestricted intergovernmental revenues 322,226 - 322,226 Tourism tax 3,553,785 - 3,553,785 Unrestricted investment earnings 29,531 5,643 35,174 Miscellaneous 26,447 - 26,447 Transfers 60,000 (60,000) - Total general revenues and transfers 13,744,388 (54,357) 13,690,031 Change in net position 3,566,027 965,316 4,531,343 Net position, beginning 24,669,188 9,059,610 33,728,798 Net position, ending 28,235,215$ 10,024,926$ 38,260,141$ Changes in Net PositionSTATEMENT OF ACTIVITIESFOR THE FISCAL YEAR ENDED SEPTEMBER 30, 2014Net (Expense) Revenue andProgram RevenuesThe accompanying notes are an integral part of these financial statements.16
BAL HARBOUR VILLAGE, FLORIDA
Aggregate Total
Non-major Governmental
General Tourism Funds Funds
ASSETS
Cash and cash equivalents 13,973,406$ 3,495,217$ 2,192,600$ 19,661,223$
Receivables, net 586,512 177,112 - 763,624
Due from other governments 54,441 - - 54,441
Prepaids 3,199 - - 3,199
Restricted cash and cash equivalents 360,775 - - 360,775
Total assets 14,978,333$ 3,672,329$ 2,192,600$ 20,843,262$
LIABILITIES, DEFERRED INFLOWS OF
RESOURCES AND FUND BALANCES
Liabilities:
Accounts payable and accrued liabilities 766,745$ 312,482$ 28,708$ 1,107,935$
Deferred inflows of resources:
Unavailable revenue - business tax license 491,978 - - 491,978
Fund balances:
Non-spendable:
Prepaids 3,199 - - 3,199
Restricted:
Debt service 306,477 - - 306,477
Tourism development - 3,359,847 - 3,359,847
State law enforcement - - 1,086,638 1,086,638
Security district - - 1,077,254 1,077,254
Assigned:
Excess benefits plan 1,399,473 - - 1,399,473
Other post employment benefits and leave time 606,273 - - 606,273
Red light camera claims 500,000 - - 500,000
Unassigned:
General fund 10,904,188 - - 10,904,188
Total fund balances 13,719,610 3,359,847 2,163,892 19,243,349
Total liabilities, deferred inflows of resources and fund balances 14,978,333$ 3,672,329$ 2,192,600$
Amounts reported for governmental activities in the statement of net position are different because:
Capital assets used in governmental activities are not financial resources and,
therefore are not reported in the funds.10,486,334
A net pension asset is not considered to represent a financial asset and therefore
is not reported in the governmental funds 1,245,109
Long-term liabilities are not due and payable in the current period and therefore
are not reported in the funds.
The detail of the difference is as follows:
Revenue bonds (306,477)
Compensated absences (427,354)
Net pension obligation - excess benefit plan (1,399,473)
Other post employment benefits (606,273)
Net position of governmental activities 28,235,215$
GOVERNMENTAL FUNDS
SEPTEMBER 30, 2014
BALANCE SHEET
The accompanying notes are an integral part of these financial statements.
17
Aggregate Total
Non-major Governmental
General Tourism Funds Funds
Revenues:
Taxes:
Property 6,781,637$ -$ -$ 6,781,637$
Other local taxes 2,005,201 - - 2,005,201
Tourism tax - 3,553,785 - 3,553,785
Licenses and permits 1,598,837 - - 1,598,837
Developer contribution 965,561 - - 965,561
Fines and forfeitures 869,783 - - 869,783
Charges for services 827,112 - 46,690 873,802
Special assessments - - 614,015 614,015
Intergovernmental 516,073 - - 516,073
Grants 243,000 - - 243,000
Investment earnings 24,568 3,304 531 28,403
Miscellaneous 26,227 1,502 34,136 61,865
Total revenues 13,857,999 3,558,591 695,372 18,111,962
Expenditures:
Current:
General government 3,438,427 - 509,984 3,948,411
Public safety 5,620,615 - - 5,620,615
Solid waste 613,773 - - 613,773
Road and streets 787,614 - - 787,614
Parks and recreation 389,739 - - 389,739
Tourism development - 2,896,764 - 2,896,764
Capital outlay 208,299 - - 208,299
Debt service:
Principal payments 21,896 - - 21,896
Interest 7,675 - - 7,675
Total expenditures 11,088,038 2,896,764 509,984 14,494,786
Excess of revenues over expenditures 2,769,961 661,827 185,388 3,617,176
Other financing sources (uses):
Transfers in 120,000 - - 120,000
Transfers out - (30,000) (30,000) (60,000)
Total other financing sources (uses) 120,000 (30,000) (30,000) 60,000
Net change in fund balances 2,889,961 631,827 155,388 3,677,176
Fund balances, beginning 10,829,649 2,728,020 2,008,504 15,566,173
Fund balances, ending 13,719,610$ 3,359,847$ 2,163,892$ 19,243,349$
BAL HARBOUR VILLAGE, FLORIDA
GOVERNMENTAL FUNDS
FOR THE FISCAL YEAR ENDED SEPTEMBER 30, 2014
STATEMENT OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCES
The accompanying notes are an integral part of these financial statements.
18
Amounts reported for governmental activities in the statement of activities
(Page 15) are different because:
Net change in fund balances - total governmental funds (Page 17) 3,677,176$
Governmental funds report capital outlays as expenditures. However,
in the statement of activities, the cost of those assets is allocated
over their estimated useful lives and reported as depreciation expense.
This is the amount by which capital outlays exceeded depreciation in
the current period.
The details of the difference are as follows:
Capital outlay 208,299$
Depreciation expense (444,545) (236,246)
Some 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.
The detail of the difference is as follows:
Net pension asset - defined benefit plans 251,466$
Net pension obligation - excess benefit plan (56,965)
Compensated absences (39,914)
Other post employment benefits (51,386) 103,201
The issuance of long-term debt (e.g., bonds, loans and capital leases) provides
current financial resources to governmental funds, while the repayment of the
principal of long-term debt consumes the current financial resources of
governmental funds.
The details of the difference is as follows:
Principal payment on revenue bonds 21,896
Change in net position of governmental activities (Page 15) 3,566,027$
BAL HARBOUR VILLAGE, FLORIDA
RECONCILIATION OF THE STATEMENT OF REVENUES, EXPENDITURES AND CHANGES IN
FUND BALANCES OF GOVERNMENTAL FUNDS TO THE STATEMENT OF ACTIVITIES
FOR THE FISCAL YEAR ENDED SEPTEMBER 30, 2014
The accompanying notes are an integral part of these financial statements.
19
Water &
Sewer
ASSETS
Current assets:
Cash and cash equivalents 7,978,319$
Receivables, net 420,457
Total current assets 8,398,776
Restricted assets:
Cash with fiscal agent 3,189,244
Restricted for customer deposits 114,532
Noncurrent assets:
Due from other government 400,287
Capital assets not being depreciated 2,731,975
Capital assets being depreciated, net 3,833,305
Total assets 18,668,119
LIABILITIES
Current liabilities:
Accounts payable and accrued liabilities 405,498
Due to other governments 283,444
Customer deposits 114,532
Revenue bonds payable 611,272
Total current liabilities 1,414,746
Non-current liabilities:
Revenue bonds payable 7,228,447
Total non-current liabilities 7,228,447
Total liabilities 8,643,193
NET POSITION
Net investment in capital assets 1,914,805
Unrestricted 8,110,121
Total net position 10,024,926$
BAL HARBOUR VILLAGE, FLORIDA
STATEMENT OF NET POSITION
PROPRIETARY FUND
SEPTEMBER 30, 2014
The accompanying notes are an integral part of these financial statements.
20
Water &
Sewer
Operating revenues:
Charges for sales and services:
Water sales 1,822,781$
Sewer sales 1,719,665
Tap fees 1,250
Fines and penalties 3,380
Total operating revenues 3,547,076
Operating expenses:
Materials, supplies and administration 680,822
Wastewater treatment charges 668,789
Water purchases 634,650
Depreciation 226,589
Personal services 104,977
Total operating expenses 2,315,827
Operating income 1,231,249
Non-operating revenues (expenses):
Interest income 5,643
Interest expense (211,576)
Total non-operating revenues (expenses) (205,933)
Income before transfers 1,025,316
Transfers out (60,000)
Change in net position 965,316
Net position, beginning 9,059,610
Net position, ending 10,024,926$
BAL HARBOUR VILLAGE, FLORIDA
STATEMENT OF REVENUES, EXPENSES AND CHANGES IN NET POSITION
PROPRIETARY FUND
FOR THE FISCAL YEAR ENDED SEPTEMBER 30, 2014
The accompanying notes are an integral part of these financial statements.
21
Water &
Sewer
Cash flows from operating activities:
Receipts from customers and users 3,566,597$
Payments to other government 283,444
Payments to suppliers (2,422,939)
Payments to employees (104,977)
Net cash provided by operating activities 1,322,125
Cash flows from non-capital financing activities:
Transfer to other funds
Cash flows from capital and related financing activities: (60,000)
Payment of bond principal (603,728)
Purchase and construction of capital assets (933,783)
Interest paid on capital debt (211,576)
Net cash used by capital and related financing activities (1,749,087)
Cash flows from investing activities:
Interest received 38,495
Net cash provided by investing activities 38,495
Net decrease in cash and cash equivalents (448,467)
Cash and cash equivalents, beginning 11,730,562
Cash and cash equivalents, ending 11,282,095$
Cash and cash equivalents per statement of net position:
Unrestricted 7,978,319$
Restricted 3,303,776
11,282,095$
Reconciliation of operating income to net cash
used by operating activities:
Operating income 1,231,249$
Adjustments to reconcile operating income to net cash
used by operating activities:
Depreciation expense 226,589
Changes in operating assets and liabilities:
(Increase) decrease in:
Receivables 18,731
Increase (decrease) in:
Accounts payable and accrued liabilities (438,678)
Due to other funds 283,444
Customer deposits 790
Total adjustments 90,876
Net cash used by operating activities 1,322,125$
BAL HARBOUR VILLAGE, FLORIDA
STATEMENT OF CASH FLOWS
PROPRIETARY FUND
FOR THE FISCAL YEAR ENDED SEPTEMBER 30, 2014
The accompanying notes are an integral part of these financial statements.
22
Pension
Trust Agency
Funds Fund
ASSETS
Cash -$ 19,123$
Investments, at fair value
Money market mutual funds 1,468,029 -
Stock mutual funds 6,163,787 -
Bond mutual funds 3,709,388 -
U.S. Government obligations 3,004,363 -
Corporate bonds 3,302,135 -
Mortgage backed securities 35,399 -
Large cap equities 10,990,801 -
Total investments 28,673,902 -
Accrued interest receivable 43,023 -
Contributions receivable 46,975 -
Total assets 28,763,900 19,123
LIABILITIES AND NET POSITION
Accounts payable 41,355 -
Other liabilities - 19,123
Total liabilities 41,355 19,123
Net position restricted for pension benefits 28,722,545$ -$
BAL HARBOUR VILLAGE, FLORIDA
FIDUCIARY FUNDS
SEPTEMBER 30, 2014
STATEMENT OF FIDUCIARY NET POSITION
The accompanying notes are an integral part of these financial statements.
23
ADDITIONS
Contributions:
Village 1,644,206$
Employees 223,092
State 44,490
Total contributions 1,911,788
Investment income:
Interest and dividends 466,459
Net appreciation in the fair value of investments 2,426,622
2,893,081
Less investment expenses 128,221
Net investment income 2,764,860
Total additions 4,676,648
DEDUCTIONS
Benefits payments 1,004,885
Administrative expenses 106,068
Lump sum DROP distributions 106,061
Refunds of contributions 61,028
Total deductions 1,278,042
Net increase in net position 3,398,606
Net position restricted for pension benefits:
Beginning, as previously reported 24,024,161
Prior period adjustment - GASB 67 adjustment 1,299,778
Beginning, as restated 25,323,939
End of year 28,722,545$
BAL HARBOUR VILLAGE, FLORIDA
PENSION TRUST FUNDS
FOR THE FISCAL YEAR ENDED SEPTEMBER 30, 2014
STATEMENT OF CHANGES IN FIDUCIARY NET POSITION
The accompanying notes are an integral part of these financial statements.
24
NOTES TO BASIC FINANCIAL STATEMENTS
25
BAL HARBOUR VILLAGE, FLORIDA
NOTES TO BASIC FINANCIAL STATEMENTS
FOR THE FISCAL YEAR ENDED SEPTEMBER 30, 2014
NOTE 1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
This summary of Bal Harbour Village’s (the Village) significant accounting policies is presented
to assist the reader in interpreting the basic financial statements and other data in this report. The
policies are considered essential and should be read in conjunction with the accompanying basic
financial statements.
The financial statements of the Village have been prepared in conformity with accounting
principles generally accepted in the United States (GAAP) as applied to governmental units. The
Governmental Accounting Standards Board (GASB) is the accepted standard-setting body for
establishing governmental accounting and financial reporting principles. The more significant of
the Village’s accounting policies are described below:
1. Financial Reporting Entity
Bal Harbour Village, Florida is a municipal corporation organized under Florida Statutes. The
Village, which was incorporated in August 1946, is located in Miami-Dade County. The Village
operates under a Council-Manager form of government with the Mayor serving as the head of the
government for all purposes and the Village Manager serving as the administrative official. The
Village provides the following services: public safety (police), physical environment (refuse
collection), transportation (maintenance of roads and streets), tourism development, special
security district protection, water and sewer utilities and general administrative services. Fire
protection, education, hospital facilities and welfare services are provided by other units of local
government whose activities are not included in the accompanying financial statements.
In accordance with accounting principles generally accepted in the United States, these financial
statements present the Village and its organizations for which the Village is considered to be
financially accountable. Financial accountability includes (1) the appointment of a voting
majority of the organization's governing body, (2) the ability of the primary government to
impose its will on the organization, or (3) if there is a financial benefit/burden relationship.
Based upon the application of these criteria, there were no organizations that met the criteria
described above.
2. Government-Wide and Fund Financial Statements
The government-wide financial statements (i.e., the statement of net position and the statement of
activities) report information on all of the non-fiduciary activities of the Village. 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 identifiable activity. Program revenues include charges to
customers or applicants who purchase, use, or directly benefit from goods, services, or privileges
BAL HARBOUR VILLAGE, FLORIDA
NOTES TO BASIC FINANCIAL STATEMENTS
(Continued)
26
NOTE 1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued)
2. Government-Wide and Fund Financial Statements (Continued)
provided by a given function or identifiable activity and 2) grants and contributions that are
restricted to meeting the operational or capital requirements of a particular function or segment.
Taxes and other items not properly included among program revenues are reported instead as
general revenues.
Separate financial statements are provided for governmental funds, proprietary funds and
fiduciary funds, even though the latter are excluded from the government-wide financial
statements. Major individual governmental funds and major individual enterprise funds are
reported as separate columns in the fund financial statements. The non-major funds are presented
in one column in the fund financial statements.
3. Measurement Focus, Basis of Accounting and Financial Statement Presentation
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 other than the agency fund which has no measurement focus. Revenues
are recorded when earned and expenses are recorded when a liability is incurred, regardless of the
timing of related cash flows. Property taxes are recognized as revenues in the year for which they
are levied. Grants and similar items are recognized as revenue as soon as all eligibility
requirements imposed by the provider have been met.
Governmental fund financial statements are reported using the current financial resources
measurement focus and the modified accrual basis of accounting. Revenues are recognized as
soon as they are both measurable and available. Revenues are considered available when they are
collectible within the current period or soon enough thereafter to pay liabilities of the current
period. For this purpose the Village considers all revenues available if they are collected within
60 days after year-end. Expenditures generally are recorded when a liability is incurred as
required by accrual accounting, except for debt service expenditures and compensated absences,
which are recorded when payment is due.
Property taxes, franchise taxes, licenses and interest associated with the current fiscal period are
all considered to be susceptible to accrual and so have been recognized as revenues of the current
fiscal period. Only the portion of special assessments receivable due within the current fiscal
period is considered to be susceptible to accrual as revenue of the current period. All other
revenue items are considered to be measurable and available only when cash is received by the
Village.
The Village reports the following major governmental funds:
The general fund is the Village’s primary operating fund. It accounts for all financial
resources of the general government, except those accounted for in another fund.
BAL HARBOUR VILLAGE, FLORIDA
NOTES TO BASIC FINANCIAL STATEMENTS
(Continued)
27
NOTE 1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued)
3. Measurement Focus, Basis of Accounting and Financial Statement Presentation
(Continued)
The tourism special revenue fund is used to account for proceeds of resort tax revenue sources
that are legally restricted to expenditures for tourism development and beach restoration. Resort
taxes are paid monthly by establishments doing business within the Village based on 4% of their
revenues from hotel room rentals and 2% of food and beverage sales.
The Village also reports the following non-major government funds:
The security district fund accounts for the special assessments received from the property
owners residing in the special district maintaining the security and common areas within the
special district.
The state law enforcement trust fund accounts for the receipts of state forfeiture monies
received through the participation in law enforcement cases resulting in the forfeiture of assets
awarded by Florida courts. These funds can only be spent for police related activities,
equipment and training and all expenditures are approved by Council.
The Village also reports the following major proprietary fund:
The water & sewer fund is used to account for water and sewer utility operations, which are
financed and operated in a manner similar to a private business enterprise. The intent of the
Village is that the costs (expenses including depreciation) of providing services to the general
public on a continuing basis be financed or recovered primarily through user charges.
Additionally, the Village reports the following fund types:
The pension trust funds are used to account for assets held by the Bal Harbour Village
Employees’ Pension Trust, the Bal Harbour Police Officers’ Pension Trust and the excess
benefit plan. The assets of the fund are restricted to providing retirement and disability
benefits to Village employees.
The pending forfeitures fund is an agency fund used to account for the receipts of federal and
state forfeiture monies received through the participation in law enforcement cases resulting in
the forfeiture of assets to the federal or state government. Money deposited in this fund and
earnings on those deposits are not considered property of the Village until awarded to the
Village by an order of the court.
BAL HARBOUR VILLAGE, FLORIDA
NOTES TO BASIC FINANCIAL STATEMENTS
(Continued)
28
NOTE 1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued)
3. Measurement Focus, Basis of Accounting and Financial Statement Presentation
(Continued)
The Plan implemented the following GASB Statement during the year ended September 30, 2014
that had an impact on the financial statements:
GASB Statement No. 67, Financial Reporting for Pension Plans – An Amendment to GASB
Statement No. 25
For defined benefit pension plans, this Statement establishes standards of financial reporting for
separately issued financial reports and specifies the required approach to measuring the pension
liability of employers and non-employer contributing entities for benefit provided through the
plan (net pension liability), about which information is required to be presented.
The October 1, 2013 beginning net position restricted for pension benefits for the Bal Harbour
Police Officers’ Pension Plan was restated due to the implementation of GASB 67 to no longer
record the DROP as a liability; it is only disclosed in the notes to the financial statements, as
follows:
Net Position, October 1, 2013, Previously Stated 14,777,697$
Restatement of Net Position Due to the Implementation of GASB 67 1,299,778
Net Position, October 1, 2013, Restated 16,077,475$
As a general rule, the effect of interfund activity has been eliminated from the government-wide
financial statements. Exceptions to this general rule are charges between the Village’s water and
sewer function and various other functions of the Village. Elimination of these charges would
distort the direct costs and program revenues reported for the various functions concerned.
Amounts reported as program revenues include 1) charges to customers or applicants for goods,
services, or privileges provided, 2) operating grants and contributions, and 3) capital grants and
contributions, including special assessments. Internally dedicated resources are reported as
general revenues rather than as program revenues. Likewise, general revenues include all taxes.
Proprietary funds distinguish operating revenues and expenses from non-operating items.
Operating revenues and expenses generally result from providing services and producing and
delivering goods in connection with a proprietary fund’s principal ongoing operations. The
principal operating revenues of the Village’s enterprise fund are charges to customers for sales
and services. Operating expenses for enterprise 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 non-operating revenues and expenses.
BAL HARBOUR VILLAGE, FLORIDA
NOTES TO BASIC FINANCIAL STATEMENTS
(Continued)
29
NOTE 1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued)
4. Deposits and Investments
Cash and cash equivalents are considered to be cash and short-term investments with original
maturities of three months or less. The Village's cash and cash equivalents include cash on hand
and investments with the Florida PRIME administered by the State Board of Administration.
All investments of the Village, except Florida PRIME, are recorded at fair value, which is based
on quoted market prices. Investments in the Florida PRIME are stated at the value of the pool
shares (2a-7 like pool), which is fair value.
5. Receivables
Receivables include amounts due from other governments and others for services provided by the
Village. Receivables are recorded and revenues are recognized as earned or as specific
expenditures/expenses are incurred. Allowances for uncollectible receivables are based upon
historical trends and the periodic aging of receivables.
6. Prepaids
Certain payments to vendors reflect costs applicable to future accounting periods and are
recorded as prepaids in the financial statements.
7. Restricted Assets
The Village reports amounts paid by customers for water and sewer deposits as restricted assets.
Unspent proceeds of the Village’s bond issue are restricted as to use and therefore are recorded as
restricted assets.
8. Capital Assets
Capital assets, which include property, plant, equipment, intangible and infrastructure assets (e.g.,
sidewalks and other similar items), are reported in the applicable governmental or business- type
activities columns in the government-wide financial statements and in the Proprietary Fund. Capital
assets are defined by the government as assets with an initial, individual cost of more than $25,000
and an estimated useful life in excess of three years. Such assets are recorded at historical cost or
estimated historical cost if purchased or constructed. Donated capital assets are recorded at
estimated fair value at the date of donation.
The costs of normal maintenance and repairs that do not add to the value of the asset or materially
extend assets lives are not capitalized. Major outlays for capital assets and improvements are
capitalized as projects are constructed or as they are otherwise acquired. Certain infrastructure
acquired prior to GASB 34 (FYE September 30, 2003) has not been reported.
BAL HARBOUR VILLAGE, FLORIDA
NOTES TO BASIC FINANCIAL STATEMENTS
(Continued)
30
NOTE 1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued)
8. Capital Assets (Continued)
Capital assets of the Village are depreciated using the straight-line method over the following
estimated useful lives:
Assets Years
Buildings 30
Improvements other than buildings 30
Public domain infrastructure 25-60
Water/sewer system 25-60
Furniture, fixtures and equipment and software 3-20
Intangible assets consist of computer software, which was capitalized as an asset in prior years,
rights of way, and easements. The Village elected not to retroactively report intangible assets,
other than computer software.
9. Compensated Absences
It is the Village’s policy to permit employees to accumulate earned, but unused, vacation pay and
comp-time benefits. Both are accrued when incurred in the government-wide and proprietary
funds and reported as a fund liability. Compensated absences are reported in governmental funds
only if they have matured. Benefits that are expected to be liquidated with expendable available
financial resources are reported as expenditures and a fund liability of the general fund. There is
no liability for unpaid accumulated sick leave since the Village does not have the policy to pay
any amounts when employees separate from service and employees do not otherwise accrue sick
leave.
10. Long-Term Obligations
In the government-wide financial statements, and the proprietary fund type in the fund financial
statements, long-term debt and other long-term obligations are reported as liabilities in the
applicable governmental activities, business-type activities, or proprietary fund type statement of
net position. Bond issuance costs are expensed as incurred.
11. Deferred Inflows of Resources
The Statement of Net Position and the Governmental Funds Balance Sheet includes a separate
section, listed below Total Liabilities, for Deferred Inflows of Resources. This represents the
acquisition of net position applicable to future periods and will not be recognized as revenue until
the future period to which it applies. Currently, the only item in this category is Unavailable
Revenue, in the Balance Sheet, and Unearned Revenue, in the Statement of Net Position, which
will be recognized as inflows of resources in the period that the amounts become available. The
sources of the unavailable revenue are local business taxes.
BAL HARBOUR VILLAGE, FLORIDA
NOTES TO BASIC FINANCIAL STATEMENTS
(Continued)
31
NOTE 1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued)
12. Fund Equity
The Village reports the following classifications:
Non-spendable fund balance. Non-spendable fund balances are amounts that are (a) not in
spendable form or (b) legally or contractually required to be maintained intact.
Restricted fund balance. Restricted fund balances are amounts that can be spent only for
specific purposes stipulated by (a) external resource providers such as creditors (by debt
covenants), grantors, contributors, or laws or regulations of other governments; or (b) imposed
by law through constitutional provisions or enabling legislation.
Committed fund balance. These amounts can only be used for the specific purposes
determined by a formal action (Ordinance and Resolution have the same authority) of the
Village Council, the Village’s highest level of decision making authority. Commitments may
be changed or lifted only by the Village Council taking the same formal action (Ordinance and
Resolution) that imposed the constraint originally. Resources accumulated pursuant to
stabilization arrangements sometimes are reported in this category.
Assigned fund balance. Assigned fund balances are amounts that are constrained by the
Village’s intent to be used for specific purposes, but are neither restricted nor committed.
Intent is established by management of the Village to which the Council has delegated the
authority to assign, modify or rescind amounts to be used for specific purposes. This balance
includes (a) all remaining amounts that are reported in governmental funds (other than the
General Fund) that are not classified as non-spendable, restricted, or committed, and (b)
amounts in the General Fund that are intended to be used for a specific purpose.
Specific amounts that are not restricted or committed in a special revenue fund are assigned
for the purposes in accordance with the nature of their fund type. Assignment within the
General Fund conveys that the intended use of those amounts is for a specific purpose that is
narrower than the general purposes of the Village itself.
Unassigned fund balance. This fund balance is the residual classification for the General
Fund. It is also used to report negative fund balances in other governmental funds.
The Village adopted a formal Fund Balance Policy that provided for definitions and
classifications of fund balance. The policy also provides for certain non-spendable fund balance,
restricted, committed, and assigned categories. Of particular note is the restricted fund balance
amount $1 million in the Village's Tourism Fund that is required by Code to be used for beach
renourishment; an estimated $1.4 million in the General Fund assigned for the Village's excess
benefit plan; General Fund balance assigned for OPEB liabilities and accrued leave time, and a
requirement to maintain a minimum unassigned General Fund fund balance of 33% of the
subsequent year's General Fund budgeted expenditures.
BAL HARBOUR VILLAGE, FLORIDA
NOTES TO BASIC FINANCIAL STATEMENTS
(Continued)
32
NOTE 1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued)
13. Net Position
The net position of the government-wide and the proprietary fund are categorized as net
investment in capital assets, restricted or unrestricted. Net investment in capital assets is that
portion of net position that relates to the Village’s capital assets reduced by accumulated
depreciation and any associated debt used to acquire or construct those capital assets.
Restricted net position is that portion of net position that has been restricted for general use by
external parties (creditors, grantors, contributors, or laws or regulations of other governments) or
imposed by law through constitutional provisions or enabling legislation. Unrestricted net
position consists of all net positions that do not meet the definition of either of the other two
components.
14. Flow Assumptions
Net Position Flow Assumption
Sometimes the Village will fund outlays for a particular purpose from both restricted and
unrestricted resources. In order to calculate the amounts to report as restricted - net position and
unrestricted – net position in the government-wide financial statements, a flow assumption must
be made about the order in which the resources are considered to be applied. It is the Village’s
policy to consider restricted – net position to have been depleted before unrestricted – net position
is applied.
Fund Balance Flow Assumption
Sometimes the Village will fund outlays for a particular purpose from both restricted and
unrestricted resources (the total of committed, assigned, and unassigned fund balance). In order
to calculate the amounts to report as restricted, committed, assigned, and unassigned fund balance
in the governmental fund financial statements, a flow assumption must be made about the order in
which the resources are considered to be applied. It is the Village’s policy to consider restricted
fund balance to have been depleted before using any of the components of unrestricted fund
balance. Further, when the components of unrestricted fund balance can be used for the same
purpose, committed fund balance is depleted first, followed by assigned fund balance.
Unassigned fund balance is applied last.
15. Use of Estimates
The financial statements and related disclosures are prepared in conformity with accounting
principles generally accepted in the United States of America. Management is required to make
estimates and assumptions that affect the reported amounts of assets and liabilities, the
disclosures of contingent assets and liabilities as of the date of the financial statements and
revenue and expenses during the period reported. These estimates include assessing the
collectability of receivables, the realization of pension obligations and the useful lives and
impairments of capital assets. Although these estimates are based on management's knowledge of
current events and actions it may undertake in the future, they may ultimately differ from actual
results.
BAL HARBOUR VILLAGE, FLORIDA
NOTES TO BASIC FINANCIAL STATEMENTS
(Continued)
33
NOTE 2. PROPERTY TAXES
Under Florida Law, the assessment of all properties and the collection of all county, municipal
and school board property taxes are consolidated in the offices of the County Property Appraiser
and County Tax Collector. The laws of the State regulating tax assessments are also designed to
assure a consistent property valuation method statewide. State statutes permit municipalities to
levy property taxes at a rate of up to 10.0 mils. The fiscal 2014 millage rate assessed by the
Village was 1.9192 mills.
The tax levy of the Village is established by the Village Council prior to October 1 each year, and
the County Property Appraiser incorporates the millage into the total tax levy, which includes
Miami-Dade County, Miami-Dade County School Board and special taxing districts.
All property is reassessed according to its fair market value as of January 1 each year. Each
assessment roll is submitted to the Executive Director of the State Department of Revenue for
review to determine if the rolls meet all of the appropriate requirements of State statutes.
All real and tangible personal property taxes are due and payable on November 1 each year or as
soon as practicable thereafter as the assessment roll is certified by the County Property Appraiser.
Miami-Dade County mails to each property owner on the assessment roll a notice of the taxes due
and Miami-Dade County also collects the taxes for the Village. Taxes may be paid upon receipt
of such notice from Miami-Dade County, with discounts at the rate of four percent (4%) if paid in
the month of November, three percent (3%) if paid in the month of December, two percent (2%)
if paid in the month of January and one percent (1%) if paid in the month of February. Taxes
paid during the month of March are without discount, and all unpaid taxes on real and tangible
personal property become delinquent and liens are placed on April 1 of the year following the
year in which taxes were assessed. Procedures for the collection of delinquent taxes by Miami-
Dade County are provided for in the laws of Florida. There were no material delinquent property
taxes as of September 30, 2014.
NOTE 3. DEPOSITS AND INVESTMENTS
Deposits
In addition to insurance provided by the Federal Depository Insurance Corporation, all deposits
are held in banking institutions approved by the State Treasurer of the State of Florida to hold
public funds. Under Florida Statutes Chapter 280, Florida Security for Public Deposits Act, the
State Treasurer requires all Florida qualified public depositories to deposit with the Treasurer or
another banking institution eligible collateral. In the event of a failure of a qualified public
depository, the remaining public depositories would be responsible for covering any resulting
losses. Accordingly, all amounts reported as deposits are deemed as insured or collateralized.
Investments - Other Than Pension Funds
Village administration is authorized to invest in those instruments authorized by the Florida
statutes, including the Florida PRIME administered by the Florida State Board of Administration
(State Treasurer’s Investment Pool).
BAL HARBOUR VILLAGE, FLORIDA
NOTES TO BASIC FINANCIAL STATEMENTS
(Continued)
34
NOTE 3. DEPOSITS AND INVESTMENTS (Continued)
Investments - Other Than Pension Funds (Continued)
The State Board of Administration (SBA) administers the Florida PRIME, which is governed by
Chapter 19-7 of the Florida Administrative Code and Chapters 218 and 215 of the Florida
Statutes. These rules provide guidance and establish the policies and general operating
procedures for the administration of the Florida PRIME. The Florida PRIME is not a registrant
with the Securities and Exchange Commission (SEC); however, the SBA has adopted operating
procedures consistent with the requirements for a 2a-7 fund, which permits money market funds
to use amortized cost to maintain a constant net asset value (NAV) of $1 per share. The fair value
of the position in the Florida PRIME is equal to the value of the pool shares. The Florida PRIME
pool is operating in a manner consistent with SEC rules of 2a-7 funds. The investments in
Florida PRIME are not insured by FDIC or any other governmental agency.
As of September 30, 2014, the Village had the following investments:
Fair Value
Florida PRIME 11,192,137$
Note: Florida PRIME is included in cash equivalents in the financial statements.
Maturity and Interest Rate Risk
The weighted average days to maturity (WAM) of the Florida PRIME at September 30, 2014,
was 39 days. Next interest rate reset dates for floating rate securities are used in the calculation
of the WAM. These dates may be different than the ultimate rate reset dates. When the ultimate
maturity date is used, a far different WAM may exist.
Credit Risk
The Florida PRIME is rated by Standard and Poor’s. The current rating is AAAm.
Concentration of Credit Risk
The Village structures its investment mix in a manner to control the risk of loss resulting from
concentration of assets to a specific maturity, instrument, issue, dealer, or bank through which
these securities are bought and sold. As of September 30, 2014, the value of each position held in
any one issuer within the Village’s portfolio is less than 5% of total investments.
Investments –General Employees’ Pension Plan
Policy
The Plan maintains a master custodial agreement whereby the investment securities are held in
the plan’s name by a financial institution acting as the Plan’s agent.
The Board of Trustees of the Bal Harbour Village Employees’ Pension Plan & Trust (Plan)
adopted an amended Investment Policy effective January 1, 2008. Concurrently with this
amended investment policy, the Board of Trustees elected to discontinue active management of a
portfolio of investments, based upon the advice of its investment monitor and advisor. The Board
of Trustees, in keeping with its consultant’s recommendation, has opted to invest in index
BAL HARBOUR VILLAGE, FLORIDA
NOTES TO BASIC FINANCIAL STATEMENTS
(Continued)
35
NOTE 3. DEPOSITS AND INVESTMENTS (Continued)
Investments – General Employees’ Pension Plan (Continued)
Policy (Continued)
funds, as provided for in the investment policy. The policy defines the scope of control of the
Board, the investment objectives, performance measurements, investment and fiduciary
standards, authorized investments, maturity and liquidity requirements, portfolio composition,
risk and diversification, target asset mixes, expected annual rates of return, and other investment
requirements.
Maturity Risk
As of September 30, 2014, the Bal Harbour Village General Employees’ Pension Plan & Trust
had the following fixed income investments and maturities:
Less Than
Fair Value 1 Year
Bond mutual funds 3,709,388$ 3,709,388$
Money market mutual funds 541,123 541,123
4,250,511$ 4,250,511$
The Plan’s investment policy limits investments to index mutual funds. Consequently, the assets
are valued daily and can be redeemed daily.
Interest Rate Risk
Interest rate risk refers to the portfolio's exposure to fair value losses arising from increasing
interest rates. The Plan does not have a formal investment policy that limits investment
maturities as a means managing its exposure to market value losses arising from changing interest
rates. However, the investment policy limits investments in fixed income instruments to index
mutual funds.
Credit Risk
The current investment policy limits investments to index mutual funds. Therefore, the portfolio
bears the credit risk of the aggregated market.
Concentration of Credit Risk
The current investment policy limits investments to index mutual funds. Therefore, the portfolio
represents the total diversification provided in the markets that the index funds mirror.
Risks and Uncertainties
The Plan has investments in mutual funds that are exposed to various risks, such as interest rate,
market and credit risk. Due to the level of risk associated with certain investment securities and
the level of uncertainty related to changes in the value of investment securities, it is at least
reasonably possible that changes in risks in the near term would materially affect balances and the
amounts reported in the statement of fiduciary net position and the statement of changes in net
fiduciary position. The Plan, through its investment advisor, monitors the Plan's investments and
risks associated therewith on a regular basis, which the Plan believes minimizes these risks.
BAL HARBOUR VILLAGE, FLORIDA
NOTES TO BASIC FINANCIAL STATEMENTS
(Continued)
36
NOTE 3. DEPOSITS AND INVESTMENTS (Continued)
Investments – Bal Harbour Police Pension Plan
The Bal Harbour Village Police Officers’ Pension Plan (Police Pension) maintains a Master
Custodian Agreement, whereby the investment securities are held in the Plan's name by a
financial institution acting as the Plan's agent.
Maturity Risk
As of September 30, 2014, the Police Pension had the following fixed income investments and
maturities:
Fair Less More
Value Than 1 1-5 6-10 Than 10
U.S. Government obligations 3,004,363$ 588,277$ 2,406,140$ 9,946$ --$
Mortgage-backed securities 35,399 - 21,691 13,708 -
Corporate bonds 3,302,135 217,712 979,100 2,105,323 -
6,341,897$ 805,989$ 3,406,931$ 2,128,977$ -$
Investment Maturities (In Years)
Interest Rate Risk
Interest rate risk refers to the portfolio's exposure to fair value losses arising from increasing
interest rates. The Police Pension does not have a formal investment policy that limits investment
maturities as a means of managing its exposure to market value losses arising from increasing
interest rates.
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 Police Pension’s investment policy limits fixed
income investments to a rating no lower than Standard & Poor’s BBB or Moody’s Baa. The
Police Pension’s corporate bonds and most of the mortgage-backed securities were all rated
“Baa” or better under Moody’s ratings and at least “BBB“ under Standard & Poor’s ratings,
however certain mortgage-backed securities investments were not rated. The majority of the
Police Pension’s fixed income investments had a rating of at least A– or better under Standard &
Poor’s and at least A or better under Moody’s.
Concentration of Credit Risk
The Police Pension’s investment policy stipulates that not more than 5% of Police Pension assets
can be invested in the common stock of any one issuing company nor can the aggregate
investment in any one issuing company exceed 5% of the outstanding capital stock of any
company.
As of September 30, 2014, the value of each position in any one issuer held by the Police Pension
comprised less than 5% of Police Pension net position and less than 5% of the value of the
outstanding capital stock of any company.
BAL HARBOUR VILLAGE, FLORIDA
NOTES TO BASIC FINANCIAL STATEMENTS
(Continued)
37
NOTE 3. DEPOSITS AND INVESTMENTS (Continued)
Investments – Bal Harbour Police Pension Plan (Continued)
Risks and Uncertainties
The Police Pension has investments in a combination of stocks, bonds, government securities and
other investment securities. Investment securities are exposed to various risks, such as interest
rate, market and credit risk. Due to the level of risk associated with certain investment securities
and the level of uncertainty related to changes in the value of investment securities, it is at least
reasonably possible that changes in risks in the near term could materially affect balances and the
amounts reported in the Statement of Fiduciary Net Position and the Statement of Changes in
Fiduciary Net Position. The Police Pension, through its investment advisors, monitors the Police
Pension’s investments and the risks associated therewith on a regular basis, which the Police
Pension believes minimizes these risks.
NOTE 4. RECEIVABLES
Receivables as of year-end for the government’s individual major funds, non-major funds and
fiduciary funds, including any applicable allowances for uncollectible accounts, are as follows:
General
Fund
Tourism
Fund
Water and
Sewer Fund
Fiduciary
Funds Total
Receivables:
Taxes and assessments 560,212$ 177,112 -$ -$ 737,324$
Accounts - - 420,457 - 420,457
Contributions - - - 43,023 43,023
Interest and other 26,300 - - 46,975 73,275
Gross receivables 586,512 177,112 420,457 89,998 1,274,079
Less allowance for uncollectibles - - - - -
Net total receivables 586,512$ 177,112$ 420,457$ 89,998$ 1,274,079$
NOTE 5. DUE FROM OTHER GOVERNMENTS
The governmental activities due from other governments of approximately $54,000 represent
taxes collected by the state of Florida and remitted to the Village.
In the business-type activities, on August 24, 2011, the Village entered into a memorandum of
understanding with the Town of Surfside for the construction of a sewer force main. When
complete, the Village will retain a 50% ownership in the improvements. The total amount
receivable for this agreement at year end was $400,287 to be paid by the Town of Surfside. The
Village expects to receive this in full prior to September 30, 2015. Subsequent to fiscal year end,
on December 24, 2014, the Village received payment in full from the Town of Surfside.
BAL HARBOUR VILLAGE, FLORIDA
NOTES TO BASIC FINANCIAL STATEMENTS
(Continued)
38
NOTE 6. CAPITAL ASSETS
Capital asset activity for the fiscal year ended September 30, 2014, was as follows:
Beginning Ending
Balance Increases Decrease Balance
Governmental activities:
Capital assets not being depreciated:
Land 277,426$ -$ -$ 277,426$
Infrastructure 1,350,459 - - 1,350,459
Work in progress 901,141 49,572 (868,499) 82,214
Total capital assets not being depreciated 2,529,026 49,572 (868,499) 1,710,099
Capital assets being depreciated:
Buildings 3,282,789 - - 3,282,789
Improvements other than buildings 10,441,014 1,027,226 - 11,468,240
Furniture, fixtures and equipment 3,802,814 - - 3,802,814
Infrastructure 427,615 - - 427,615
Total capital assets being depreciated 17,954,232 1,027,226 - 18,981,458
Less accumulated depreciation for:
Buildings (2,065,556) (137,632) - (2,203,188)
Improvements other than buildings (3,876,565) (189,657) - (4,066,222)
Furniture, fixtures and equipment (3,585,735) (94,906) - (3,680,641)
Infrastructure (232,822) (22,350) - (255,172)
Total accumulated depreciation (9,760,678) (444,545) - (10,205,223)
Total capital assets being depreciated, net 8,193,554 582,681 - 8,776,235
Governmental activities capital assets, net 10,722,580$ 632,253$ (868,499)$ 10,486,334$
Business-type activities:
Capital assets not being depreciated:
Land 7,010$ -$ 7,010$
Work in progress 1,791,183 933,782 - 2,724,965
Total capital assets not being depreciated 1,798,193 933,782 - 2,731,975
Capital assets being depreciated:
Building 23,865 - - 23,865
Furniture, fixtures and equipment 1,151,976 - - 1,151,976
Water/sewer system 5,349,393 - - 5,349,393
Total capital assets being depreciated 6,525,234 - - 6,525,234
Less accumulated depreciation for:
Building (18,711) - - (18,711)
Furniture, fixtures and equipment (654,774) (16,301) - (671,075)
Water/sewer system (1,791,855) (210,288) - (2,002,143)
Total accumulated depreciation (2,465,340) (226,589) - (2,691,929)
Total capital assets being depreciated, net 4,059,894 (226,589) - 3,833,305
Business-type activities capital assets, net 5,858,087$ 707,193$ -$ 6,565,280$
BAL HARBOUR VILLAGE, FLORIDA
NOTES TO BASIC FINANCIAL STATEMENTS
(Continued)
39
NOTE 6. CAPITAL ASSETS (Continued)
Depreciation expense for the fiscal year ended September 30, 2014, was charged to
functions/programs as follows:
Governmental activities:
General government 284,296$
Public safety 133,096
Roads, streets, and parks 20,273
Tourism development 6,880
Total depreciation expense, governmental activities 444,545$
Business-type activities:
Water and sewer 226,589$
NOTE 7. INTERFUND TRANSFERS
Transfers In
Security Water and
General Tourism District Sewer Total
General -$ 30,000$ 30,000$ 60,000$ 120,000$
Transfers Out
Transfers are used to transfer revenues based on the Village ordinance and budget in order to
reimburse the General fund for certain costs.
NOTE 8. LONG-TERM DEBT
On October 18, 2011, the Village issued the Capital Improvement Revenue Bonds, Series 2011
Bonds (Bonds). 96.5% of this debt was allocated to the water and sewer fund and 3.5% was
allocated to the general fund. The Bonds shall bear interest on the outstanding principal balance
from their date of issuance payable semiannually on each March 31, September 30 (the Interest
Payment Dates), commencing March 31, 2012, at an interest rate equal to 63% of the 10-Year H-
15 Swap Index, plus 1.05% (the Fixed Rate). As used herein, "10-Year H-15 Swap Index" means
the most recent rate designated as the 10-year interest rate swap rate under the H.15 Selected
Interest Rates published by the Federal Reserve. The interest rate as of September 30, 2014 on
the Bonds was 2.4995%.
BAL HARBOUR VILLAGE, FLORIDA
NOTES TO BASIC FINANCIAL STATEMENTS
(Continued)
40
NOTE 8. LONG-TERM DEBT (Continued)
The Village pledged, assigned and granted a security interest in the Local Government Half-Cent
Sales Tax Revenues, the Municipal Revenue Sharing Revenues and the Alcoholic Beverage
License Tax Revenues in order to secure the principal of and interest on the Bonds. To the extent
these revenues are insufficient to pay principal of and interest on the Bonds when due, the Village
agrees to appropriate in its annual budget, if necessary, Non-Ad Valorem Revenues lawfully
available in each fiscal year, amounts sufficient to pay the principal and interest due on the Bonds
in accordance with their terms during such fiscal year.
Total pledged revenues to repay the principal and interest of those bonds as of September 30,
2014 are as follows:
Revenue Bonds
Current revenue pledged $465,003
Current debt service $837,057
Total future revenue pledged $9,499,812
Description of debt
Bal Harbour Village, Florida Capital
Improvement Revenue Bonds, Series 2011
Purpose of debt Series 2011 revenue bonds to fund water and
sewer projects
Term of commitment 2011-2026
Percentage of debt service to pledged revenue
(current year) 180%
The bonds outstanding at September 30, 2014 consist of the following:
Maximum
Amount Amount Interest Annual Debt
Purpose of Issue Issued Outstanding Rate Service
Revenue bonds:
Series 2011 Capital Improvement 10,000,000$ 8,146,196$ 2.50% 1,470,501$
Long-term liabilities activity for the fiscal year ended September 30, 2014 for governmental and
business-type activities was the following:
Beginning Ending Due Within
Balance Additions Reductions Balance One Year
Governmental activities:
Revenue bonds 328,373$ -$ (21,896)$ 306,477$ 22,171$
Compensated absences 387,440 45,450 (5,536) 427,354 262,650
Total governmental activities,
long-term liabilities 715,813$ 45,450$ (27,432)$ 733,831$ 284,821$
Business-type activities:
Revenue bonds 8,443,447$ -$ (603,728)$ 7,839,719$ 611,272$
BAL HARBOUR VILLAGE, FLORIDA
NOTES TO BASIC FINANCIAL STATEMENTS
(Continued)
41
NOTE 8. LONG-TERM DEBT (Continued)
The following is the summary of annual debt service requirements:
Fiscal Year Ended
September 30,Principal Interest
2015 633,443$ 203,614$
2016 641,360 187,781
2017 649,375 171,751
2018 657,491 155,519
2019 665,708 139,085
2020-2024 3,455,433 441,638
2025-2026 1,443,386 54,228
8,146,196$ 1,353,616$
Revenue Bonds
NOTE 9. EMPLOYEE RETIREMENT PLANS
The following brief descriptions of the Retirement Plans are provided for general information
purposes only. Participants should refer to the Plan documents for more complete information.
1. Summary of Significant Accounting Policies
Basis of Accounting
Public Employee Retirement Systems (PERS) financial statements are prepared using the accrual
basis of accounting. Plan member contributions are recognized in the period in which the
contributions are due. Employer contributions to each plan, as calculated by each plan’s actuary
are recognized when due and the employer has made a formal commitment to provide the
contributions. Expenses are recognized in the accounting period incurred, if measurable.
Benefits and refunds are recognized when due and payable in accordance with the terms of the
Plans.
Method Used to Value Investments
Investments of the pension trust funds are reported at fair value. Short-term investments are
reported at cost, which approximates fair value. Securities traded on a national or international
exchange are valued at the last reported sales price. Net appreciation (depreciation) in fair value
of investments, realized and unrealized gains (losses) are determined on the basis of specific cost.
Interest and dividend income is recognized on the accrual basis when earned. Purchases and sales
of investments are recorded on a trade date basis.
BAL HARBOUR VILLAGE, FLORIDA
NOTES TO BASIC FINANCIAL STATEMENTS
(Continued)
42
NOTE 9. EMPLOYEE RETIREMENT PLANS (Continued)
2. Plan Descriptions
The Village, as a single employer, maintains two public employee retirement systems defined
benefit pension plans covering substantially all full-time employees and an unfunded excess
benefits plan. On October 1, 1955, the Village established the Bal Harbour Village Employees’
Pension Trust (General Employees’ Pension). During the fiscal year ended September 30, 2000,
the police officers of the Village elected to form their own plan in order to continue receiving
Section 185 monies from the State of Florida. To fund benefits owed by employment contracts
that cannot be funded through either defined benefit plan, the Village established the Bal Harbour
Village Excess Benefit Plan during fiscal year 2009.
The pension plans are considered to be part of the Village’s financial reporting entity and are
included in the Village’s financial statements as pension trust funds. The Bal Harbour Police
Officers’ Pension Trust issues a publicly available financial report that includes the financial
statements and required supplementary information. The report may be obtained by writing to
Joan Wall, Plan Administrator, or calling (954) 723-9521.
As of September 30, 2014, the police pension plan has received a response from the IRS and is
awaiting final approval of its determination letter. Although at this time the plan does not have a
determination from the IRS, the Plan administrator and counsel believe that the Plan is designed
and is currently being operated in compliance with the applicable sections of the Internal Revenue
Code.
The Bal Harbour Village Excess Benefits Plan is a qualified governmental excess benefit plan
established in accordance with Section 415 of the Internal Revenue Code. The purpose of the
Plan is to provide retirement benefits to employees covered by either or both of the Village’s
defined benefit plans whose benefits are otherwise limited by IRC §415.
Plan membership consisted of the following at October 1, 2013, the latest actuarial valuation date
for the Bal Harbour Employees’ Pension Trust, October 1, 2014, the latest actuarial valuation date
for the Bal Harbour Police Officers’ Pension Trust, and at September 30, 2013, the latest actuarial
date for the excess benefits plan:
Excess
Benefits
Retirees and beneficiaries currently receiving benefits
and terminated employees entitled to benefits but not
yet receiving them 1
Current employees:
Vested -
Non-vested -
Total -
BAL HARBOUR VILLAGE, FLORIDA
NOTES TO BASIC FINANCIAL STATEMENTS
(Continued)
43
NOTE 9. EMPLOYEE RETIREMENT PLANS (Continued)
2. Plan Descriptions (Continued)
General
Police
Officers
Inactive plan members and beneficiaries currently receiving benefits 19 22
Inactive plan members entitled but not yet receiving benefits 7 2
Active plan members 24 13
Total members 50 37
While the Village has not expressed any intent to discontinue the Plan, it may do so at any time,
providing that benefits accrued to the date of termination are adequately funded.
Bal Harbour Employees’ Pension Trust
The benefit provisions and all other requirements of the Retirement Plan for General Employees
are established by Ordinance No. 447, as amended, and are summarized as follows:
Vesting
Benefits are fully vested after 10 years of credited service.
Eligibility for Participation
Full time employees, after completing one year of continuous employment from the anniversary
date of the Plan, which is October 1.
Eligibility for Retirement
The Plan provides for normal retirement as follows:
a) Age 57, regardless of service,
b) Age 55, having completed 25 years of continuous employment or
c) 30 years of continuous employment regardless of age.
Annual Retirement Benefit
The monthly retirement benefit is equal to 3% of final average compensation (average of the
highest 36 consecutive months of compensation, as defined, during the 10 years immediately
preceding retirement or termination) times completed years and months of continuous
employment.
Cost of Living Adjustment
Retired participants, except those who elect to take a lump sum distribution, will receive a two
and one half percent compounded annual COLA; commencing on the one year anniversary of the
retirement date and will continue to be paid each year thereafter. To receive the COLA an
employee must be or become an active participant on or after March 21, 2006.
BAL HARBOUR VILLAGE, FLORIDA
NOTES TO BASIC FINANCIAL STATEMENTS
(Continued)
44
NOTE 9. EMPLOYEE RETIREMENT PLANS (Continued)
2. Plan Descriptions (Continued)
Bal Harbour Employees’ Pension Trust (Continued)
Target Asset Mix
The Policy establishes the following Target Asset Mix for the plan:
Target
Asset Class Allocation
Return US Equity - Large Cap 30%
US Equity - Mid Cap 10%
US Equity - Small Cap 10%
International Equity 7%
Emerging Markets Equity 3%
Domestic Fixed Income 35%
Cash and Cash Equivalence 5%
100%
Other Benefits
The system also provides for optional retirement benefits, early retirement, deferred retirement,
disability retirement and death benefits
Contributions and Funding Policy
Employees are required to contribute 8% of their annual compensation, to be deposited each pay
period. The Village is required to contribute the amount in excess of employee contributions to
pay the annual pension cost. The pension board establishes the required employee contribution.
The required employer contribution is actuarially determined as of October 1 of each year.
If any employee leaves covered employment or dies before ten years of credited service,
accumulated employee contributions are refunded to the employee or the designated beneficiary.
Rate of Return
For the year ended September 30, 2014, the annual money-weighted rate of return on pension
investments, net of pension plan investment expense was 8.49%.
The money-weighted rate of return expresses investment performance, net of investment expense,
adjusted for the changing amounts actually invested. Inputs to the dollar-weighted rate of return
calculation are determined on a monthly basis.
BAL HARBOUR VILLAGE, FLORIDA
NOTES TO BASIC FINANCIAL STATEMENTS
(Continued)
45
NOTE 9. EMPLOYEE RETIREMENT PLANS (Continued)
2. Plan Descriptions (Continued)
Bal Harbour Employees’ Pension Trust (Continued)
Deferred Retirement Option Program
The Bal Harbour Employees’ Pension Trust has a Deferred Retirement Option Program (DROP)
for participants who are eligible to receive normal retirement. Eligible members may apply to
participate by applying to the Board. Upon a member’s election to participate in the DROP, that
member shall be considered retired. Monthly retirement benefits that would have been payable
had the member retired without electing the DROP will be paid into the DROP and credited to the
retired member who may not receive any of these amounts until they actually sever employment
with the Village. Upon separation from service with the Village, the entire DROP balance is
made to or for the benefit of the participant as a lump sum distribution. Payments into the DROP
will earn the same return as earned by the remainder of the Plan assets or a fixed rate of 4% at the
option of the participant. This option can be changed every year prior to December 1st for the
following calendar year. If they do not make a choice, the default option is the fixed rate of 4%.
At September 30, 2014, there were 4 members who were enrolled under the DROP. The total
liability for the members DROP account as of September 30, 2014 was $212,085. This amount is
included in the total investment balance and the net position presented on the statement of
fiduciary net position.
BAL HARBOUR VILLAGE, FLORIDA
NOTES TO BASIC FINANCIAL STATEMENTS
(Continued)
46
NOTE 9. EMPLOYEE RETIREMENT PLANS (Continued)
2. Plan Descriptions (Continued)
Bal Harbour Employees’ Pension Trust (Continued)
Deferred Retirement Option Program (Continued)
The Bal Harbour Employees’ Pension Trust does not issue separate stand-alone financial statements;
therefore, included below is the Statement of Fiduciary Net Position and the Statement of Changes
in Fiduciary Net Position as of and for the fiscal year ended September 30, 2014.
ASSETS
Investments:
Cash and money market mutual funds 541,123$
Stock mutual funds 6,163,787
Bond mutual funds 3,709,388
Receivables 3,150
Total assets 10,417,448
NET POSITION
Net position restricted for pension benefits 10,417,448$
ADDITIONS
Village contributions 671,605$
Employee contributions 89,677
Total contributions 761,282
Investment earnings:
Interest and dividends 167,540
Net appreciation in the fair value of investments 662,519
830,059
Less investment expenses 31,847
Net investments income 798,212
Total additions 1,559,494
DEDUCTIONS
Benefits paid 361,172
Administrative expenses 27,338
Total deductions 388,510
Change in net position 1,170,984
Net position restricted for pension benefits:
Beginning of year 9,246,464
End of year 10,417,448$
STATEMENT OF FIDUCIARY NET POSITION
STATEMENT OF CHANGES IN FIDUCIARY NET POSITION
BAL HARBOUR VILLAGE, FLORIDA
NOTES TO BASIC FINANCIAL STATEMENTS
(Continued)
47
NOTE 9. EMPLOYEE RETIREMENT PLANS (Continued)
2. Plan Descriptions (Continued)
Bal Harbour Police Officers’ Pension Trust
The Bal Harbour Village Police Officers’ Pension Plan was established to account for the pension
for the Village’s police officers. The Plan is considered part of the Village’s financial reporting
entity and is included in the Village's financial statements as a pension trust fund. Benefit and
contribution provisions are established by Village ordinance and may be amended only by the
Board of Trustees, subject to approval of the Village Council. The Plan is available to full time
sworn Police Officers from date of employment, including probationary period. Participation is
mandatory as a condition of employment, except for the Police Chief, who may opt out.
The Plan is administered by a Board of Trustees comprised of:
a. Two Village residents appointed by the Village Council.
b. Two Police Officers elected by a majority of Police Officers.
c. A fifth member elected by the Board and appointed (as a ministerial duty) by the Village
Council.
The benefit provisions and all other requirements of the Plan are established by Ordinance No.
474, as amended, and are summarized as follows:
Contributions and Funding Policy
Employees contribute 10% of their compensation. The Village is required to contribute the
amount in excess of employee contributions to pay the annual pension cost. The Village Council,
through establishment or modification of enabling legislation, establishes the required employee
contribution. The required employer contribution, which is a percentage of annual covered
payroll and includes amounts contributed by the State pursuant to Chapter 175, Florida Statutes,
is actuarially determined as of October 1st of each year. The annual required employer
contribution for the fiscal year ended September 30, 2014 was determined based on the
October 1, 2012 actuarial valuation and was 72.9% of non-DROP covered payroll.
If any employee leaves covered employment or dies before ten years of credited service,
accumulated employee contributions are refunded to the employee or the designated beneficiary.
Benefits Provided
The Plan provides retirement, termination, disability and death benefits.
Normal Retirement
Date: Earliest of age 55 and 10 years of Credited Service; age 57, regardless of service; or 20
years of Credited Service, regardless of age.
Benefit: 3.50% of Final Average Compensation times Years of Credited Service.
Minimum Benefit: $25 per month.
BAL HARBOUR VILLAGE, FLORIDA
NOTES TO BASIC FINANCIAL STATEMENTS
(Continued)
48
NOTE 9. EMPLOYEE RETIREMENT PLANS (Continued)
Bal Harbour Police Officers’ Pension Trust (Continued)
2. Plan Descriptions (Continued)
Early Retirement
Eligibility: Age 50 and 10 Years of Credited Service.
Benefit: Accrued benefit reduced 3.0% for each year that Early Retirement precedes Normal
Retirement.
Vesting (Termination of Employment)
Less than 1 year: Refund of Member Contributions, with 5.0% interest.
1-9 Years: 10% of accrued pension for each complete year of service, payable at Normal
Retirement, or a refund of contributions described above.
10 Years or More: 100% of accrued pension payable at Normal Retirement Date.
Disability
Eligibility: Total and permanent; Medical proof required.
Service Connected Benefit: Accrued benefit, but not less than 42% of average monthly
compensation on date of disability.
Non-Service Connected Benefit: Accrued benefit, but not less than 25% of average monthly
compensation on date of disability.
Pre-Retirement Death Benefits
Service Connected: 50% of base rate of pay on date of death, paid for 10 years.
Non-Service Connected: Accrued Benefit, actuarially reduced if early commencement, paid for
10 years.
Minimum Benefit: Greater of actuarial equivalent of accrued benefit, or Member’s contributions.
Cost-of-Living Adjustment
Retirees who were actively employed on or after February 21, 2006 receive 2.5% annually, after
one year of receiving benefits.
Investment Policy
The following was the Board's adopted asset allocation policy target allocation as of September 30,
2014:
Asset Class Target Allocation
Large Cap Equities 60%
Intermediate Fixed Income 40
Total 100%
BAL HARBOUR VILLAGE, FLORIDA
NOTES TO BASIC FINANCIAL STATEMENTS
(Continued)
49
NOTE 9. EMPLOYEE RETIREMENT PLANS (Continued)
2. Plan Descriptions (Continued)
Bal Harbour Police Officers’ Pension Trust (Continued)
Rate of Return
For the year ended September 30, 2014 the annual money-weighted rate of return on pension
investments, net of pension plan investment expense, was 12.04 percent.
The money-weighted rate of return expresses investment performance, net of investment expense,
adjusted for the changing amounts actually invested. Inputs to the dollar-weighted rate of return
calculation are determined on a monthly basis.
Deferred Retirement Option Program
On April 13, 2007, the Bal Harbour Village Police Officers’ Pension Plan amended the Deferred
Retirement Option Program (DROP) for participants who are eligible to receive normal
retirement. Eligible members may apply to participate by applying to the Board.
Upon a member’s election to participate in the DROP, that member shall cease to be a member of
the Bal Harbour Village Police Officers’ Pension Plan and shall be precluded from any additional
benefits under the Plan; accordingly, that member shall be considered retired. Monthly
retirement benefits that would have been payable had the member retired and elected to receive
monthly pension payments will be paid into the DROP and credited to the retired member.
Payments in the DROP are made monthly for the period the retired member participates in the
DROP, up to a maximum of 60 months, an increase from prior maximum of 36 months.
Payments into the DROP will earn the same return as earned by the remainder of the Plan assets.
Employees also now have the option to select from either the rate of return of the fund or a fixed
4%. This can be changed every year prior to December 1 for the following calendar year. If they
do not make a choice, the default is 4%. Upon termination of employment, participants in the
DROP will receive the balance of their account either in a lump sum distribution or in any other
form of payment selected by the participant, approved by the Board and conforming to applicable
laws.
At September 30, 2014, there were 8 participants who were enrolled under the DROP. The
DROP balance as September 30, 2014 is $1,933,306. The DROP investment assets are included
in the total investment balance presented on the Statement of Fiduciary Net Position.
BAL HARBOUR VILLAGE, FLORIDA
NOTES TO BASIC FINANCIAL STATEMENTS
(Continued)
50
NOTE 9. EMPLOYEE RETIREMENT PLANS (Continued)
2. Plan Descriptions (Continued)
Bal Harbour Village Excess Benefits Plan
Vesting
Benefits are fully vested immediately upon entry into the Plan.
Eligibility for Participation
Based upon employment contract language and participation in either or both defined benefit
plans.
Eligibility for Benefits Under the Plan
A participant shall receive a benefit equal to the difference between the retirement allowance
otherwise payable from either or both defined benefit plans prior to any reduction or limitation
required by IRC §415 and the actual retirement allowance payable as limited by IRC §415. The
benefit shall be subject to withholding for applicable state and federal taxes. The benefit shall be
paid in accordance with the retirement payment option selected by the participant or beneficiary
for the retirement otherwise payable by either or both defined benefit plans.
Funding Policy
To be qualified under IRC §415, Excess Benefits Plans, the Village cannot advance fund any
benefit currently payable under the Plan and any assets held by the Plan during any year can only
be used to pay for benefits coming due during the year or for expenses of the Plan during the
year. Contributions by the Village are not allowed to accumulate from year-to-year for purposes
of advance funding of any of the Excess Plans liabilities. Any assets, including all property
rights and beneficial interests of the Plan remain the general, unpledged, and unrestricted assets
of the Plan and the Village. The interests of participants and their beneficiaries of the Plan are not
senior to the claims of unsecured creditors of the Plan or the Village. The Village has recorded a
liability in the amount of $1,399,473 in the government-wide financial statements that represents
the net pension obligation of the Plan as of September 30, 2014. The Village has elected to
present this net benefit obligation separately from the net pension asset of the Village’s two
defined benefit plans because of the nature of the Excess Benefit Plan and the likelihood that
substantially all of the benefits payable under the plan will be distributed within five years. The
Village cannot restrict any assets, including cash, for the purpose of providing funding for these
benefits. However, the Village has designated a portion of its General Fund fund balance for the
purpose of noting its intent to fund the benefits payable under the Plan. The Village believes it
had sufficient financial assets at September 30, 2014, to pay the benefits payable under the Plan.
BAL HARBOUR VILLAGE, FLORIDA
NOTES TO BASIC FINANCIAL STATEMENTS
(Continued)
51
NOTE 9. EMPLOYEE RETIREMENT PLANS (Continued)
2. Plan Descriptions (Continued)
Bal Harbour Village Excess Benefits Plan (Continued)
Funding Policy (Continued)
The funded status of the Plan as of September 30, 2014, the most recent actuarial valuation date,
is as follows:
Actuarial UAAL as a
Actuarial Accrued Unfunded Percentage
Actuarial Value of Liability AAL Funded Covered of Covered
Valuation Assets (AAL) Entry (UAAL) Ratio Payroll Payroll
Date (a)Age (b)(b-a)(a/b)(c)((b-a)¸c)
September 30, 2014 -$ 1,399,473$ 1,399,473$ 0% -$ N/A
To be qualified under IRC §415, the Plan cannot be advance funded. Accordingly, neither the
Village nor the Participant has ever provided any funding to the Plan. The Plan held no assets,
liabilities or net position at September 30, 2014.
3. Funded Status and Funding Progress
Additional information as of the latest actuarial valuation follows:
Actuarial valuation date September 30, 2014
Annual Pension Cost $112,303
Contributions made $55,338
Actuarial cost method Entry Age Normal
Amortization method Immediate Recognition
Amortization period (on gain/loss) 1 year
Asset valuation method Unfunded
Actuarial Assumptions
Investment rate of return * 4.00%
Projected salary increases* N/A
Payroll growth assumptions N/A
*Includes general price inflation at 2.5%
BAL HARBOUR VILLAGE, FLORIDA
NOTES TO BASIC FINANCIAL STATEMENTS
(Continued)
52
NOTE 9. EMPLOYEE RETIREMENT PLANS (Continued)
4. Annual Pension Cost and Net Pension Obligation (Asset)
The annual pension cost and net pension obligation (asset) for the current year was as follows:
General Police Excess
Employees Employees Benefit Total
Annual required contribution 497,853$ 1,004,620$ 55,602$ 1,558,075$
Interest on net pension obligation (28,736) (48,840) 56,701 (20,875)
Adjustment to annual required
contributions 34,961 47,294 - 82,255
Annual pension cost 434,156 1,003,074 112,303 1,549,533
Contributions made 671,605 1,017,091 55,338 1,744,034
Change in net pension obligation (asset) (237,449) (14,017) 56,965 (194,501)
Net pension obligation (asset),
beginning of year (383,140) (610,503) 1,342,508 348,865
Net pension obligation (asset),
end of year (620,589)$ (624,520)$ 1,399,473$ 154,364$
Bal Harbour Employee Pension Trust
The annual pension cost for the current year was $434,156, determined as part of the October 1,
2013, actuarial valuation using the entry age normal cost method.
Annual Pension Amount Percentage of Net Pension
Fiscal Year Ending Cost (APC)Contributed APC Contributed Asset
9/30/2012 365,741$ 432,342$ 118% (347,620)$
9/30/2013 488,764 524,284 107% (383,140)
9/30/2014 434,156 671,605 155% (620,589)
Three-Year Trend Information
Bal Harbour Police Officers’ Pension Trust
The annual pension cost for the current year was $1,003,074, determined as part of the updated
October 1, 2014, actuarial valuation using the aggregate actuarial cost method. The contributions
made were received from the state and were properly recorded as on-behalf payments by the
Village. The aggregate actuarial cost method does not identify and separately amortize unfunded
actuarial liabilities.
BAL HARBOUR VILLAGE, FLORIDA
NOTES TO BASIC FINANCIAL STATEMENTS
(Continued)
53
NOTE 9. EMPLOYEE RETIREMENT PLANS (Continued)
4. Annual Pension Cost and Net Pension Obligation (Asset) (Continued)
Bal Harbour Police Officers’ Pension Trust (Continued)
Annual Pension Percentage of Net Pension
Fiscal Year Ending Cost (APC)APC Contributed Asset
9/30/2012 1,014,632$ 118%(603,933)$
9/30/2013 837,979 101%(610,503)
9/30/2014 1,003,074 101% (624,520)
Three-Year Trend Information
The required supplementary information is presented after the notes to the basic financial
statements.
Bal Harbour Village Excess Benefits Plan
The annual pension cost for the current year was $112,303, determined as of the September 30,
2014 actuarial valuation using the entry age normal cost method.
Fiscal Year Annual Percentage Net Pension
Ending Pension Cost Contributed Obligation
9/30/2012 52,086$ N/A 1,417,521$
9/30/2013 185,945 171% 1,342,508
9/30/2014 112,303 49% 1,399,473
Three-Year Trend Information
NOTE 10. NET PENSION LIABILITY
Bal Harbour Employee Pension Trust
The following are the components of the net pension liability at September 30, 2014 for the
General Employees’ Pension:
Total pension liability 13,044,531$
Plan fiduciary net position (10,417,448)
Net pension liability 2,627,083$
Plan fiduciary net position as a percentage
of the total pension liability 79.86%
BAL HARBOUR VILLAGE, FLORIDA
NOTES TO BASIC FINANCIAL STATEMENTS
(Continued)
54
NOTE 10. NET PENSION LIABILITY
Bal Harbour Employee Pension Trust (Continued)
Significant Actuarial Assumptions
The total pension liability was determined by an actuarial valuation as of October 1, 2013, using
the following significant actuarial assumptions, applied to all periods included in the
measurement:
Investment Rate of Return 7.0% per year compounded annually, net of investment
expenses, including inflation. This assumption was used
beginning with the October 1, 2013 valuation, revised from
7.5% used previously.
Salary Increases 5% per year, including inflation.
Inflation 2.50% per year.
Mortality RP2000 Table (Combined Healthy) as published by the
Society of Actuaries, projected forward 21 years using Scale
AA.
Experience Studies Rates of mortality, turnover, disability and retirement were the
subject of an experience study in 2006.
The Village complies with the State statutes by making contributions to the trust in amounts at
least equal to the Actuarially Determined Contribution. It was assumed that the Village would
continue to comply with the funding requirement imposed by such statutes and the current active
members would continue to make their required member contributions until their expected exit
dates. Based on the current contribution policy, the plan is expected to eliminate unfunded
actuarial accrued liability by 2033 and, consequently, the pension plan’s fiduciary net position
together with the future contributions are expected to be available to finance all projected future
benefit payments of all current plan members. Therefore, the long-term expected rate of return on
pension plan investments was applied to all periods of projected benefit payments to determine
the total pension liability.
Long-Term Expected Rate of Return
The long-term expected rate of return is 7%. This rate is supported by applying a building block
process that begins with the inflation rate of 2.5%. The long-term expected arithmetic means for
gross rates of return for any given single year for each relevant asset class were obtained and
reduced by expected inflation to obtain expected real rates of return. Each one was further
reduced by 0.48 % for investment-related expenses to obtain expected real net returns, with
results multiplied by the plan’s asset allocation percentage for each such asset class, resulting in a
plan composite long-term real net rate of return expected for any given single year; refer to the
table below. Inflation was added back in to the plan’s composite long-term expected real net rate
of return and further reduced by 0.69% for volatility drag to recognize long-term compound
averaging, to obtain 7.19%. These assumptions and methods support the 7% long-term net rate of
return as reasonable.
BAL HARBOUR VILLAGE, FLORIDA
NOTES TO BASIC FINANCIAL STATEMENTS
(Continued)
55
NOTE 10. NET PENSION LIABILITY
Bal Harbour Employee Pension Trust (Continued)
Long-Term Expected Rate of Return (Continued)
Best estimates of arithmetic real rates of return for each major asset class included in the pension
plan's target asset allocation as of September 30, 2014 are summarized in the following table:
Long-term
Expected Real
Rate of
Asset Class Return
Return US Equity - Large Cap 7.4%
US Equity - Mid Cap 7.8%
US Equity - Small Cap 8.3%
International Equity 7.8%
Emerging Markets Equity 9.5%
Domestic Fixed Income 2.2%
Cash and Cash Equivalence -0.9%
Discount Rate
A single discount rate of 7.0% was used to measure the total pension liability as of October 1,
2013 rolled forward to September 30, 2014. This single discount rate was based solely on the
long-term expected rate of return on pension plan investments of 7.0%, without any requirement
to incorporate municipal bond yields.
The projection of cash flows used to determine the discount rate assumed that plan member
contributions will be made at the current contribution rate and that sponsor contributions will be
made at rates equal to the difference between actuarially determined contribution rates and the
member rate.
Sensitivity of the Net Pension Liability to Changes in the Discount Rate
The following table provides the sensitivity of the net pension liability to changes in the discount
rate as of September 30, 2014. In particular, the table presents the plan’s net pension liability, if it
were calculated using a single discount rate that is one-percentage-point lower or one-percentage-
point higher than the single discount rate:
1% Current 1%
Decrease Discount Increase
(6.00%)Rate (7.00%)(8.00%)
Net Pension Liability $ 4,392,879 $ 2,627,083 $ 1,184,676
BAL HARBOUR VILLAGE, FLORIDA
NOTES TO BASIC FINANCIAL STATEMENTS
(Continued)
56
NOTE 10. NET PENSION LIABILITY (Continued)
Bal Harbour Police Officers’ Pension Trust
The following are the components of the net pension liability at September 30, 2014 for the
Police Officers’ Pension Trust:
Total pension liability $ 23,926,041
Plan fiduciary net position (18,305,097)
Net pension liability $ 5,620,944
Plan fiduciary net position as a percentage
of the total pension liability 76.51%
Significant Actuarial Assumptions
The total pension liability was determined by an actuarial valuation as of October 1, 2013
updated to September 30, 2014 using the following actuarial assumptions applied to all
measurement periods.
Inflation 3.00%
Salary increases 7.00%
Investment rate of return 8.00%
RP 2000 Combined Healthy – Sex Distinct. Disabled lives set forward 5 years. Based on a study
of over 650 public safety funds, this table reflects a 10% margin for future mortality
improvements.
The actuarial assumptions used in the September 30, 2014 valuation were based on the results of
an actuarial experience study dated March 19, 2008 for the period from October 1, 2001 through
October 1, 2007.
Long-Term Expected Rate of Return
The long-term expected rate of return on pension plan investments was determined using a
building-block method in which best-estimate ranges of expected future real rates of return
(expected returns, net of pension plan investment expenses and inflation) are developed for each
major asset class.
These ranges are combined to produce the long term expected rate of return by weighting the
expected future real rates of return by the target asset allocation percentage and by adding
expected inflation.
BAL HARBOUR VILLAGE, FLORIDA
NOTES TO BASIC FINANCIAL STATEMENTS
(Continued)
57
NOTE 10. NET PENSION LIABILITY (Continued)
Bal Harbour Police Officers’ Pension Trust (Continued)
Long-Term Expected Rate of Return (Continued)
Best estimates of arithmetic real rates of return for each major asset class included in the pension
plan's target asset allocation as of September 30, 2014 are summarized in the following table:
Long-Term Expected
Asset Class Real Rate of Return
Large Cap Equities 7.75%
Intermediate Fixed Income 1.90%
Discount Rate
The discount rate used to measure the total pension liability was 8.00%.
Based on those assumptions, the pension plan's fiduciary net position was projected to be
available to make all projected future benefit payments of current plan members. The
amortization payments for benefits of current members are based on closed amortization periods.
Therefore, the long-term expected rate of return on pension plan investments was applied to all
periods of projected benefit payments to determine the total pension liability.
Sensitivity of the Net Pension liability to Changes in the Discount Rate
The following presents the net pension liability of the plan sponsor, calculated using the discount
rate of 8.00% percent, as well as what the plan sponsor’s net pension liability would be if it were
calculated using a discount rate that is 1-percentage-point lower (7.00%) or 1-percentage-point
higher (9.00%) than the current rate:
1% Current 1%
Decrease Discount Increase
(7.00%) Rate (8.00%) (9.00%)
Net Pension Liability $ 8,346,328 $ 5,620,944 $ 3,366,877
BAL HARBOUR VILLAGE, FLORIDA
NOTES TO BASIC FINANCIAL STATEMENTS
(Continued)
58
NOTE 11. OTHER POST EMPLOYMENT BENEFITS
Plan Description
Bal Harbour Village provides health insurance benefits to its retired employees through a single-
employer plan administered by the Village. Pursuant to the provisions of Section 112.0801,
Florida Statutes, former employees who retire from the Village and eligible dependents, may
continue to participate in the Village’s fully-insured benefit plan for medical and prescription
drug insurance coverage. The Village subsidizes the premium rates paid by retirees by allowing
them to participate in the plan at reduced or blended group (implicitly subsidized) premium rates
for both active and retired employees. These rates provide an implicit subsidy for retirees
because, on an actuarial basis, their current and future claims are expected to result in higher costs
to the plan on average than those of active employees. The benefits provided under this defined
benefit plan are provided for a retiree’s lifetime (or until such time at which retiree discontinues
coverage under the Village sponsored plans, if earlier). Additionally, and as provided by a
collective bargaining agreement, eligible retired sworn police officers from the Village receive a
health stipend of $350 per month until age of 65 which can be used to pay for health insurance at
the Village or outside. Retirees are required to enroll in the Federal Medicare program for their
primary coverage as soon as they are eligible. The Plan may be amended or terminated by the
Village if Florida law changes or if collective bargaining agreements are amended.
Funding Policy
Currently, the Village’s Other Post-Employment Benefits are unfunded. That is, the Village
Council has not determined if a separate Trust Fund or equivalent arrangement will be established
into which the Village would make contributions to advance-fund the obligation. For fiscal year
2014, 3 retirees received other postemployment benefits (including retirees covered under
Village’s health plan). The Village provided required contributions of $90,942 toward the annual
OPEB cost, in the form of age adjusted premiums paid on behalf of retirees for the fully insured
benefits and health stipend. If the Plan is amended or terminated by the Village because of
Florida law changes, amendments to collective bargaining agreements, or other reasons, the
Village may amend its funding system or its benefits. The funding percentage for each employee
is 100% of the implied subsidy or 100% of the $350 stipend, as applicable.
Annual OPEB Cost and Net OPEB Obligation
The employer has elected to calculate the annual required contribution of the employer (ARC)
and related information using the Alternative Measurement Method permitted by GASB
Statement 45 for employers in plans with fewer than one hundred total plan members. The
Employer's annual other postemployment benefit (OPEB) cost (expense) is calculated based on
the ARC. The ARC represents a level of funding that, if paid on an ongoing basis, is projected to
cover normal cost each year and to amortize any unfunded actuarial liabilities (or funding excess)
over a period not to exceed 20 years.
BAL HARBOUR VILLAGE, FLORIDA
NOTES TO BASIC FINANCIAL STATEMENTS
(Continued)
59
NOTE 11. OTHER POST EMPLOYMENT BENEFITS (Continued)
Annual OPEB Cost and Net OPEB Obligation (Continued)
Annual Required Contribution (ARC) 137,636$
Interest on Net OPEB Obligation (NOO) 27,746
Adjustment to Annual Required Contribution (ARC) (23,054)
Annual OPEB Cost 142,328
Employer Contributions Made 90,942
Increase in Net OPEB Obligation 51,386
Net OPEB Obligation, beginning of year 554,887
Net OPEB Obligation, end of year 606,273$
The Employer's annual OPEB cost, the percentage of annual OPEB cost contributed to the plan,
and the net OPEB obligation were as follows:
Fiscal Annual Percentage of
Year OPEB Annual OPEB Net OPEB
Ending Cost Cost Contributed Obligation
9/30/2012 240,866$ 37% 463,005$
9/30/2013 133,164 31% 554,887
9/30/2014 142,328 64% 606,273
Three-Year Trend Information
Funded Status and Funding Progress
As of the reporting date and based on the most recent actuarial valuation date of September 30,
2013, which is applicable for three fiscal years, the plan assets were $0, the actuarial accrued
liability for benefits was $1,519,896, the total unfunded actuarial liability is $1,519,896, and the
actuarial value of assets as a percentage of the actuarial accrued liability (funded ratio) is 0%.
The covered payroll (annual payroll of active employees covered by the plan) was $4,012,636,
and the ratio of the unfunded actuarial accrued liability to the covered payroll was approximately
38%.
The projection of future benefit payments for an ongoing plan involves estimates of the value of
reported amounts and assumptions about the probability of occurrence of events far into the
future. Examples include assumptions about future employment, mortality, and the healthcare
cost trend. Amounts determined regarding the funded status of the plan and the annual required
contributions of the employer are subject to continual revision as actual results are compared with
past expectations and new estimates are made about the future. The schedule of funding
progress, presented as required supplementary information following the notes to the financial
statements, presents multiyear trend information about whether the actuarial value of plan assets
is increasing or decreasing over time relative to the actuarial accrued liabilities for benefits.
BAL HARBOUR VILLAGE, FLORIDA
NOTES TO BASIC FINANCIAL STATEMENTS
(Continued)
60
NOTE 11. OTHER POST EMPLOYMENT BENEFITS (Continued)
Funded Status and Funding Progress (Continued)
Actuarial UAAL as a
Actuarial Accrued Unfunded Percentage
Actuarial Value of Liability AAL Funded Covered of Covered
Valuation Assets (AAL) Entry (UAAL) Ratio Payroll Payroll
Date (a)Age (b)(b-a)(a/b)(c)((b-a)¸c)
September 30, 2013 -$ 1,519,896$ 1,519,896$ 0.0% 4,012,636$ 37.9%
Methods and Assumptions
Projections of benefits for financial reporting purposes are based on the substantive plan (the plan
as understood by the employer and plan members) and include the types of benefits provided at
the time of each valuation and the historical pattern of sharing of benefit costs between the
employer and plan members to that point. The methods and assumptions used include techniques
that are designed to reduce the effects of short-term volatility in actuarial accrued liabilities and
the actuarial value of assets, consistent with the long-term perspective of the calculations.
Significant methods and assumptions are as follows:
Actuarial valuation date September 30, 2013
Actuarial cost method Entry age normal
Amortization method Level percent, closed
Remaining amortization 20 years
Actuarial assumptions:
Investment rate of return* 5.0%
Projected salary increase* 7.0%
Payroll growth assumptions 6.0%
Initial trend rate 5.0%
*Includes inflation at 5.0%
Health cost trends 5.0%-8.5%
As authorized by GASB 45, The Alternative Measurement Method allows the employer to use
simplifications of certain assumptions in measuring actuarial accrued liabilities and the ARC.
The following simplifying assumptions were made:
Retirement age for active employees – The earliest age eligible for normal retirement was
used.
BAL HARBOUR VILLAGE, FLORIDA
NOTES TO BASIC FINANCIAL STATEMENTS
(Continued)
61
NOTE 11. OTHER POST EMPLOYMENT BENEFITS (Continued)
Methods and Assumptions (Continued)
Active Member Marital status – Assumption of marital status for active employees has been
incorporated in the acceptance probability for spousal coverage. Using this approach, the
percentage of future retired plan members taking spousal coverage was assumed at 30%. For
active employees, spouses’ genders were assumed to be opposite to the members’ genders and
females were assumed 3 years younger than their spouses. Covered spouse data were collected
for current retired plan members as of the valuation date, and were assumed to remain
unchanged until the assumed death of the spouses.
Mortality – Life expectancies were based on the RP2000 Generational Combined Healthy
Male and Female mortality tables.
Turnover – Non-group-specific age-based turnover data provided in GASB Statement 45 were
used as the basis for assigning active members a probability of remaining employed until the
assumed retirement age and for developing an expected future working lifetime assumption
for purposes of allocating to periods the present value of total benefits to be paid.
Health insurance premiums – Health insurance premiums for retirees in effect on the fiscal
year ending date were used as the basis for calculation of the present value of total benefits to
be paid.
NOTE 12. COMMITMENTS AND CONTINGENCIES
Litigation, Claims and Assessments
In the normal course of business, the Village may be involved in pending or threatened litigation,
claims or assessments. The Village’s administration, the Village Council and legal counsel
anticipate that any claims not covered by insurance or limited by state statute would not have a
material adverse effect on the financial position of the Village.
Operating Leases
During fiscal year 2010, the Village entered a 7-year operating lease for office space for the
police department at the Bal Harbour Shops. The lease requires monthly payments of $4,863.62,
or $58,363 annually with no escalation clauses. The lease is subject to annual appropriations.
The Village can cancel the lease at any time but would be subject to paying the remaining costs of
the build out of the office space.
BAL HARBOUR VILLAGE, FLORIDA
NOTES TO BASIC FINANCIAL STATEMENTS
(Continued)
62
NOTE 12. COMMITMENTS AND CONTINGENCIES (Continued)
Grants
Grant monies received and disbursed by the Village for specific purposes may be subject to audit
by the grantor agencies. Such audits may result in requests for reimbursements due to disallowed
expenditures or other actions by grantor agencies. The Village does not believe that such
disallowances or other actions taken by the grantor agencies, if any, would have a material effect
on the financial position of the Village.
NOTE 13. RISK MANAGEMENT
The Village is exposed to various risks of loss related to torts, theft of, damage to and destruction
of assets, errors and omissions, and natural disasters for which the Village carries commercial
insurance. There were no reductions in insurance coverages from coverages in the prior year and
there were no settlements that exceeded insurance coverages for each of the past three years.
NOTE 14. EXCESS OF EXPENDITURES OVER APPROPRIATIONS
General Fund
The actual expenditures for the Police Department was $425,000 more than budgeted (7.6%),
largely a result of unbudgeted expenditures for the Red Light Camera Program and Off-Duty
requests, due to increased activity offset by corresponding revenue, both resulted in net revenue
generation for the Village. In the summer of 2013, the Finance Department assumed the
responsibility of invoicing and payment to Off-Duty police officers from the PBA due to
compliance issues, this resulted in $89,000 in unbudgeted Off-Duty expenditure, which are offset
by payments made by the requesting entity inclusive of an administrative fee; the program
resulted in $43,000 in net revenue to the Village. Red light camera expenditures are $74,000
more than budgeted due to increased revenue, the program generated $206,000 in net revenue for
FY 2013-14; a fund balance reserve of $500,000 still remains in the Village’s financials in the
event of a negative outcome for the program. Retirement expenditure are $82,000 more than
budgeted for the Department, in addition the Chief position was recruited and filled earlier than
anticipated as the position was budgeted for only half the year, and overtime expenditures were
higher than budget as a result of a pending investigation which has since been concluded.
The actual expenditure for the Public Works Department are $231,000 less than budgeted (-
14.2%), largely due to the proper redirecting of Utility Master Plan development expenditure to
the Utility Fund, and Resort Tax eligible expenditures to the Resort Tax Fund.
Roads and Streets were $9,008 over budget due to higher than anticipated contractual
expenditures.
BAL HARBOUR VILLAGE, FLORIDA
NOTES TO BASIC FINANCIAL STATEMENTS
(Continued)
63
NOTE 14. EXCESS OF EXPENDITURES OVER APPROPRIATIONS (Continued)
General Fund (Continued)
The actual expenditure for the Parks and Recreation Department was $54,000 more than budgeted
(13.8%), largely due to the use of overtime, and increased hours for part-time employees to meet
operational needs.
Overall expenditures in the General Fund were $142,248 less than budgeted.
REQUIRED SUPPLEMENTARY INFORMATION
(OTHER THAN MD&A)
Variance
with Final
Original Budget -
and Final Actual Positive
Budget Amounts (Negative)
Revenues:
Taxes:
Property 6,679,900$ 6,781,637$ 101,737$
Other local taxes 1,739,391 2,005,201 265,810
Licenses and permits 1,021,571 1,598,837 577,266
Developer contribution - 965,561 965,561
Fines and forfeitures 451,600 869,783 418,183
Charges for services 747,862 827,112 79,250
Intergovernmental 416,262 516,073 99,811
Grants - 243,000 243,000
Miscellaneous 29,700 26,227 (3,473)
Investment earnings 24,000 24,568 568
Total revenues 11,110,286 13,857,999 2,747,713
Expenditures:
Current:
General government:
Legislative 671,402 379,067 292,335
Executive 965,506 883,364 82,142
Finance and administration 701,812 513,317 188,495
General government 927,773 781,480 146,293
Building department 565,219 881,199 (315,980)
Total general government 3,831,712 3,438,427 393,285
Public safety 5,180,810 5,620,615 (439,805)
Solid waste and open space 614,000 613,773 227
Roads and streets 778,606 787,614 (9,008)
Parks and recreation 335,587 389,739 (54,152)
Debt service:
Principal and interest 29,571 29,571 -
Capital outlay 460,000 208,299 251,701
Total expenditures 11,230,286 11,088,038 142,248
Excess (deficiency) of revenues over expenditures (120,000) 2,769,961 2,889,961
Other financing sources:
Transfers in 120,000 120,000 -
Net change in fund balance -$ 2,889,961$ 2,889,961$
BAL HARBOUR VILLAGE, FLORIDA
GENERAL FUND
FOR THE FISCAL YEAR ENDED SEPTEMBER 30, 2014
BUDGETARY COMPARISON SCHEDULE
See notes to budgetary comparison schedules.
64
Variance
with
Final
Original Budget -
and Final Actual Positive
Budget Amounts (Negative)
Revenues:
Tourism tax 3,547,131$ 3,553,785$ 6,654$
Miscellaneous - 1,502 1,502
Investment earnings - 3,304 3,304
Total revenues 3,547,131 3,558,591 11,460
Expenditures:
Tourism development 3,517,131 2,896,764 620,367
Excess of revenues over expenditures 30,000 661,827 631,827
Other financing uses:
Transfers out (30,000) (30,000) -
Total other financing uses (30,000) (30,000) -
Net change in fund balance -$ 631,827$ 631,827$
FOR THE FISCAL YEAR ENDED SEPTEMBER 30, 2014
BAL HARBOUR VILLAGE, FLORIDA
TOURISM SPECIAL REVENUE FUND
BUDGETARY COMPARISON SCHEDULE
See notes to budgetary comparison schedules.
65
66
BAL HARBOUR VILLAGE, FLORIDA
NOTE TO BUDGETARY COMPARISON SCHEDULES
FOR THE FISCAL YEAR ENDED SEPTEMBER 30, 2014
NOTE 1. BUDGET AND BUDGETARY ACCOUNTING
The Village legally adopts annual budgets for all of its funds, except the State Law Enforcement
Trust Fund and the Federal Law Enforcement Trust Fund. Of the major funds presented in a
budget-to-actual format, only the general and tourism special revenue funds have adopted
budgets. The budgets are prepared on a basis consistent with accounting principles generally
accepted in the United States of America. The Village Manager may make transfers of
appropriations within a department. Transfers of appropriations between departments and
between funds require the approval of the Village Council. Therefore, the legal level of control
for the general fund is at the department level.
The Village follows these procedures in establishing the budgetary data reflected in the financial
statements.
a) During July, the Village Manager submits to the Village Council a proposed operating and
capital budget for the fiscal year beginning the following October 1. The budget includes
proposed revenues and expenditures with an explanation regarding each expenditure that is
not of a routine nature.
b) Two public hearings are conducted to obtain taxpayer and citizen comments.
c) Prior to September 30th, the budget is legally enacted through passage of an ordinance or
resolution.
d) At the request of the Village Manager and within the last three months of the budget year, the
Council may, by resolution, transfer any unencumbered appropriation balance from one
office or department to another. Typically, the Village elects not to retroactively amend its
budget.
e) Budgeted amounts reflected in the accompanying financial statements are as originally
adopted and as amended.
f) There were no amendments to any of the Village’s budgets during the year.
REQUIRED SUPPLEMENTARY INFORMATION
SCHEDULE OF CHANGES IN THE VILLAGE'S NET PENSION LIABILITY AND RELATED RATIOS
BAL HARBOUR EMPLOYEES' PENSION TRUST
2014
Total Pension Liability
Service cost 287,964$
Interest 865,195
Changes in benefit terms -
Difference between actual and expected experience -
Changes of benefit terms differences between expected
and actual experience -
Changes of assumptions -
Benefit payments (361,172)
Net Change in Total Pension Liability 791,987
Total Pension Liability - Beginning 12,252,544
Total Pension Liability - Ending (a)13,044,531$
Plan Fiduciary Net Position
Contributions - employer/state 671,605$
Contributions - member 89,677
Net Investment income 798,212
Benefit payments, including refunds of member contributions (361,172)
Administrative expense (27,338)
Net Change in Plan Fiduciary Net Position 1,170,984
Plan Fiduciary Net Position - Beginning 9,246,464
Plan Fiduciary Net Position - Ending (b)10,417,448$
Net Pension Liability - Ending (a) - (b)2,627,083$
Plan Fiduciary Net Position as a Percentage of the Total Pension Liability 79.86%
Covered Employee Payroll 1,726,458$
Net Pension Liability as a Percentage of Covered-Employee Payroll 152.17%
This schedule is presented to illustrate the requirement to show information for 10 years. However, until a
full 10-year trend is compiled, pension plans should present information for those years for which information
is available.
BAL HARBOUR VILLAGE, FLORIDA
67
REQUIRED SUPPLEMENTARY INFORMATION
SCHEDULE OF CHANGES IN THE VILLAGE'S NET PENSION LIABILITY AND RELATED RATIOS
BAL HARBOUR POLICE OFFICERS' PENSION TRUST
2014
Total Pension Liability
Service cost 346,349$
Interest 1,800,823
Change in excess state money --
Share plan allocation --
Changes of benefit terms differences between expected --
and actual experience
Changes of assumptions --
Benefit payments, including refunds of employee contributions (810,803)
Net Change in Total Pension Liability 1,336,369
Total Pension Liability - Beginning 22,589,672
Total Pension Liability - Ending (a)23,926,041$
Plan Fiduciary Net Position
Contributions - employer 972,601$
Contributions - state 44,490
Contributions - employee 133,415
Net investment income 1,966,648
Benefit payments, including refunds of member contributions (810,802)
Administrative expense (78,730)
Net Change in Plan Fiduciary Net Position 2,227,622
Plan Fiduciary Net Position - Beginning 16,077,475
Plan Fiduciary Net Position - Ending (b)18,305,097$
Net Pension Liability - Ending (a) - (b)5,620,944$
Plan Fiduciary Net Position as a Percentage of the Total Pension Liability 76.51%
Covered Employee Payroll 1,334,157$
Net Pension Liability as a Percentage of Covered-Employee Payroll 421.31%
BAL HARBOUR VILLAGE, FLORIDA
This schedule is presented to illustrate the requirement to show information for 10 years. However, until a full
10-year trend is compiled, pension plans should present information for those years for which information is
available.
68
BAL HARBOUR EMPLOYEES' PENSION TRUST 2014
Actuarially Determined Contribution 671,605$
Contributions in Relation to the Actuarially Determined Contribution 497,853
Contribution Deficiency (Excess) 173,752$
Covered-Employee Payroll 1,726,458$
Contributions as a Percentage or Covered-Employee Payroll 28.84%
Notes to Schedule of Contributions
Timing
Actuarial Cost Method Entry Age Normal Cost Method
Amortization Method Closed, Level % of Pay Method
Remaining Amortization Period 26.1 years
Asset Valuation Method
Inflation 2.50% per year.
Salary Increases 5% per year, including inflation.
Investment Rate of Return
Retirement Age Experience-based table of rates based on year of eligibility.
Post Retirement COLA 2.50% (automatic)
Mortality
7.5% per year compounded annually, net of investment expenses.
RP2000 Table (Combined Healthy) as published by the Society of Actuaries,
projected forward 21 years using Scale AA
BAL HARBOUR VILLAGE, FLORIDA
REQUIRED SUPPLEMENTARY INFORMATION
SCHEDULES OF EMPLOYER CONTRIBUTIONS
This schedule is presented to illustrate the requirement to show information for 10 years. However,until a full 10-
year trend is compiled, pension plans should present information for those years for which information is
available.
Actuarially determined contribution rates are calculated as of October 1, a
beginningof the fiscal year precedingthe year whichcontributionsare reported.
Assumptions and methods below relate to the October 1, 2012 actuarial
valuation with actuarially determinedcontributionapplicable to the year ending
September 30 2014
5-year Smoothed Market Value: Difference between the expected and actual
return on market value of assets phased in over a period of five (5) years (at the
rate of 20% per year), adjusted to be no greater than 120% and no less than
80% of the fair market value.
69
BAL HARBOUR POLICE OFFICERS' PENSION TRUST 2014
Actuarially Determined Contribution 1,004,620$
Contributions in Relation to the Actuarially Determined Contribution 1,017,091
Contribution Deficiency (Excess) (12,471)$
Covered-Employee Payroll 1,334,157$
Contributions as a Percentage or Covered-Employee Payroll 76.23%
Notes to Schedule of Contributions
Valuation Date: 10/1/2012
Actuarial Cost Method Entry Age Normal Cost Method
Amortization Method Level Percentage of Pay, Closed
Remaining Amortization Period 22 Years (as of 10/01/2012).
Asset Valuation Method
Inflation 3.0% per year
Salary Increases 7.0% per year up to the assumed retirement age
Investment Rate of Return
Fund Earnings
Payroll Increase Up to 4.0% per year (2.68% for 10/1/12 valuation).
Cost-of-Living Adjustment 2.5% per year
Retirement Age
7.75%, net of pension plan investment expense, including inflation.
8% per year, compounded annually, net of investment related expenses.
Earlier of age 55 and 10 years of serviceor age 57, regardless of service,
or 20 years of service, regardless of age; Members at the assumed
retirement age are assumed to continue employment for one more year.
BAL HARBOUR VILLAGE, FLORIDA
REQUIRED SUPPLEMENTARY INFORMATION
SCHEDULES OF EMPLOYER CONTRIBUTIONS
Thisschedule is presented to illustrate the requirement to show information for 10 years. However,until a
full 10-year trend is compiled, pension plans should present information for those years for which
information is available.
Methods and assumptions used to determine contribution rates:
Actuarially determined contribution rates are calculated as of October 1, two years prior to the end of the
fiscal year in which contributions are reported.
Each year, the prior Actuarial Value of Assets is brought forward
utilizing the historical geometric five-year average Market Value return
(net of fees). It is possible that over time this techniquewill produce an
insignificant bias above or below Market Value of Assets.
70
REQUIRED SUPPLEMENTARY INFORMATION
SCHEDULES OF INVESTMENT RETURNS
2014
BAL HARBOUR EMPLOYEES' PENSION TRUST
Annual Money-Weighted Rate of Return, Net of Investment Expense 8.49%
BAL HARBOUR POLICE OFFICERS' PENSION TRUST
Annual Money-Weighted Rate of Return, Net of Investment Expense 12.04%
This schedule is presented to illustrate the requirement to show information for 10 years. However,
until a full 10-year trend is compiled, pension plans should present information for those years for
which information is available.
BAL HARBOUR VILLAGE, FLORIDA
71
REQUIRED SUPPLEMENTARY INFORMATION
SCHEDULE OF FUNDING PROGRESS
BAL HARBOUR VILLAGE EXCESS BENEFITS PLAN
UAAL
as a
Actuarial Percentage
Actuarial Accrued Unfunded of
Actuarial Value of Liability AAL Funded Covered Covered
Valuation Assets (AAL) Entry (UAAL) (1) Ratio Payroll Payroll
Date (a)Age (b)(b-a)(ab)(c)((b-a)c)
September 30, 2009 -$ 1,083,934$ 1,083,934$ 0.0% -$ N/A
September 30, 2010 - 1,200,727 1,200,727 0.0% - N/A
September 30, 2011 - 1,312,917 1,312,917 0.0% - N/A
September 30, 2012 - 1,417,521 1,417,521 0.0% - N/A
September 30, 2013 - 1,342,508 1,342,508 0.0% - N/A
September 30, 2014 - 1,399,473 1,399,473 0.0% - N/A
BAL HARBOUR VILLAGE, FLORIDA
72
REQUIRED SUPPLEMENTARY INFORMATION
OTHER POST EMPLOYMENT BENEFITS
SCHEDULE OF FUNDING PROGRESS
UAAL
as a
Actuarial Percentage
Actuarial Accrued Unfunded of
Actuarial Value of Liability AAL Funded Covered Covered
Valuation Assets (AAL) (UAAL) Ratio Payroll Payroll
Date (a)(b)(b-a)(ab)(c)((b-a)c)
September 30, 2010 -$ 1,822,218$ 1,822,218$ 0.0% 3,516,020$ (51.8%)
September 30, 2013 - 1,519,896 1,519,896 0.0% 4,012,636 (37.9%)
BAL HARBOUR VILLAGE, FLORIDA
73
COMBINING FUND FINANCIAL
STATEMENTS AND SCHEDULE
BAL HARBOUR VILLAGE, FLORIDA
State Law Security Total
Enforcement District Non-Major
Special Special Governmental
Revenue Revenue Funds
ASSETS
Total assets 1,086,638$ 1,105,962$ 2,192,600$
LIABILITIES AND FUND BALANCE
Liabilities:
Accounts payable and accrued liabilities -$ 28,708$ 28,708$
Fund balance:
Restricted:
State law enforcement 1,086,638 - 1,086,638
Security district - 1,077,254 1,077,254
Total fund balances 1,086,638 1,077,254 2,163,892
Total liabilities and fund balances 1,086,638$ 1,105,962$ 2,192,600$
COMBINING BALANCE SHEET
NON-MAJOR GOVERNMENTAL FUNDS
SEPTEMBER 30, 2014
74
State Law Security Total
Enforcement District Non-Major
Special Special Governmental
Revenue Revenue Funds
Revenues:
Special assessments -$ 614,015$ 614,015$
Charges for services - 46,690 46,690
Investment earnings 154 377 531
Miscellaneous 29,550 4,586 34,136
Total revenues 29,704 665,668 695,372
Expenditures:
Current:
General government 60,600 449,384 509,984
Total expenditures 60,600 449,384 509,984
Excess (deficiency) of revenues
over expenditures (30,896) 216,284 185,388
Other financing uses:
Transfers out - (30,000) (30,000)
Total other financing uses - (30,000) (30,000)
Net change in Fund balance (30,896) 186,284 155,388
Fund balance, beginning 1,117,534 890,970 2,008,504
Fund balance, ending 1,086,638$ 1,077,254$ 2,163,892$
BAL HARBOUR VILLAGE, FLORIDA
COMBINING STATEMENT OF REVENUES, EXPENDITURES AND
NON-MAJOR GOVERNMENTAL FUNDS
FOR THE FISCAL YEAR ENDED SEPTEMBER 30, 2014
CHANGES IN FUND BALANCES
75
Variance
with
Final
Original Budget -
and Final Actual Positive
Budget Amounts (Negative)
Revenues:
Special assessments 616,826$ 614,015$ (2,811)$
Charges for services 19,400 46,690 27,290
Investment earnings 500 377 (123)
Miscellaneous 2,200 4,586 2,386
Total revenues 638,926 665,668 26,742
Expenditures:
General government 608,926 449,384 159,542
Excess of revenues over expenditures 30,000 216,284 186,284
Transfers out (30,000) (30,000) -
Total other financing uses (30,000) (30,000) -
Net change in fund balance -$ 186,284$ 186,284$
BAL HARBOUR VILLAGE, FLORIDA
BUDGETARY COMPARISON SCHEDULE
SECURITY DISTRICT FUND
FOR THE FISCAL YEAR ENDED SEPTEMBER 30, 2014
76
General Police
Employees Officers
Pension Pension Totals
ASSETS
Investments, at fair value:
Money market mutual funds 541,123$ 926,906$ 1,468,029$
Stock mutual funds 6,163,787 - 6,163,787
Bond mutual funds 3,709,388 - 3,709,388
U.S. Government obligations - 3,004,363 3,004,363
Corporate bonds - 3,302,135 3,302,135
Mortgage-backed securities - 35,399 35,399
Large cap equities - 10,990,801 10,990,801
Total investments 10,414,298 18,259,604 28,673,902
Accrued interest receivable 3,150 39,873 43,023
Contributions receivable - 46,975 46,975
Prepaid expenses - - -
Total assets 10,417,448 18,346,452 28,763,900
LIABILITIES AND NET POSITION
Payables - 41,355 41,355
Net position restricted for pension benefits 10,417,448$ 18,305,097$ 28,722,545$
BAL HARBOUR VILLAGE, FLORIDA
PENSION TRUST FUNDS
SEPTEMBER 30, 2014
COMBINING STATEMENT OF FIDUCIARY NET POSITION
77
General Police
Employees Officers
Pension Pension Totals
ADDITIONS
Contributions:
Village 671,605$ 972,601$ 1,644,206$
Employees 89,677 133,415 223,092
State - 44,490 44,490
Total contributions 761,282 1,150,506 1,911,788
Investment income:
Interest and dividends 167,540 298,919 466,459
Net appreciation in the fair value of investments 662,519 1,764,103 2,426,622
830,059 2,063,022 2,893,081
Less investment expenses 31,847 96,374 128,221
Net investment income 798,212 1,966,648 2,764,860
Total additions 1,559,494 3,117,154 4,676,648
DEDUCTIONS
Benefits payments 361,172 643,713 1,004,885
Administrative expenses 27,338 78,730 106,068
Lump sum DROP distributions - 106,061 106,061
Refunds of contributions - 61,028 61,028
Total deductions 388,510 889,532 1,278,042
Net increase 1,170,984 2,227,622 3,398,606
Net position restricted for pension benefits:
Beginning, as previously reported 9,246,464 14,777,697 24,024,161
Prior period adjustment - GASB 67 adjustment - 1,299,778 1,299,778
Beginning, as restated 9,246,464 16,077,475 25,323,939
End of year 10,417,448$ 18,305,097$ 28,722,545$
BAL HARBOUR VILLAGE, FLORIDA
PENSION TRUST FUNDS
FOR THE FISCAL YEAR ENDED SEPTEMBER 30, 2014
COMBINING STATEMENT OF CHANGES IN FIDUCIARY NET POSITION
78
Balance Balance
October 1, September 30,
2013 Additions Reductions 2014
ASSETS
Cash 19,123$ -$ -$ 19,123$
Total assets 19,123$ -$ -$ 19,123$
LIABILITIES
Other liabilities 19,123$ -$ -$ 19,123$
Total liabilities 19,123$ -$ -$ 19,123$
BAL HARBOUR VILLAGE, FLORIDA
STATEMENT OF CHANGES IN ASSETS AND LIABILITIES
AGENCY FUND
FOR THE FISCAL YEAR ENDED SEPTEMBER 30, 2014
PENDING FORFEITURES
79
STATISTICAL SECTION
This part of Bal Harbour Village'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 Village's overall
financial health.
Contents Page
Financial Trends
These schedules contain trend information to help the reader understand how the Village's
financial performance and well-being have changed over time. These schedules include:80-85
Revenue Capacity
These schedules contain information to help the reader assess the Village's most significant
local revenue source, the property tax. 86-91
Debt Capacity
These schedules present information to help the reader assess the affordability of the
Village's current levels of outstanding debt and the Village's ability to issue additional debt
in the future.92-95
Demographic and Economic Information
These schedules offer demographic and economic indicators to help the reader understand
the environment within which the Village's financial activities take place. 96-97
Operating Information
These schedules contain service and infrastructure data to help the reader understand how
the information in the Village's financial report relates to the services the Village provides
and the activities it performs.98-99
Sources: Unless otherwise noted, the information in these schedules is derived from the
financial statements or comprehensive annual financial reports for the relevant year.
STATISTICAL SECTION
Table 12005200620072008200920102011201220132014Government activities:Net invested in capital assets 11,308,000$ 10,885,624$ 10,716,448$ 10,626,630$ 10,620,527$ 11,220,950$ 10,810,475$ 10,341,047$ 10,745,368$ 10,540,631$ Restricted 1,496,000 1,508,378 1,549,990 1,735,324 5,369,673 3,708,129 6,190,902 4,147,049 5,064,897 5,871,135 Unrestricted 7,934,000 8,455,792 8,746,631 10,824,395 8,283,400 8,651,338 8,222,534 8,766,748 8,858,923 11,864,368 Total governmental activities net position 20,738,000$ 20,849,794$ 21,013,069$ 23,186,349$ 24,273,600$ 23,580,417$ 25,223,911$ 23,254,844$ 24,669,188$ 28,276,134$ Business-type activities:Net invested in capital assets 1,860,000$ 1,837,218$ 2,030,763$ 1,690,543$ 1,716,897$ 2,919,134$ 4,275,935$ 6,243,708$ 603,883$ 1,914,085$ Unrestricted 3,747,000 3,926,297 3,803,228 4,307,292 4,464,828 4,032,506 3,875,947 2,044,968 8,455,727 8,110,121 Total business-type activities net position 5,607,000$ 5,763,515$ 5,833,991$ 5,997,835$ 6,181,725$ 6,951,640$ 8,151,882$ 8,288,676$ 9,059,610$ 10,024,206$ Primary government:Net invested in capital assets 13,168,000$ 12,722,842$ 12,747,211$ 12,317,173$ 12,337,424$ 14,140,084$ 15,086,310$ 16,584,755$ 11,349,251$ 12,455,436$ Restricted 1,496,000 1,508,378 1,549,990 1,735,324 5,369,673 3,708,129 6,190,902 4,147,049 5,064,897 5,871,135 Unrestricted 11,681,000 12,382,089 12,549,859 15,131,687 12,748,228 12,683,844 12,098,481 10,811,716 17,314,650 19,974,489 Total primary governmentnet position 26,345,000$ 26,613,309$ 26,847,060$ 29,184,184$ 30,455,325$ 30,532,057$ 33,375,693$ 31,543,520$ 33,728,798$ 38,301,060$ BAL HARBOUR VILLAGE, FLORIDANET POSITION BY COMPONENTLAST TEN FISCAL YEARS(Accrual Basis of Accounting)80
Table 22005200620072008200920102011201220132014Expenses:Governmental activities:General government 2,489,941$ 3,143,865$ 2,970,072$ 3,991,551$ 5,314,974$ 4,516,478$ 4,628,012$ 3,844,820$ 3,858,620$ 4,143,524$ Public safety 4,366,861 5,126,152 5,285,093 5,586,145 7,210,074 7,853,964 8,909,849 8,887,246 5,607,676 5,739,694 Community services 1,395,816 1,809,409 2,262,036 2,061,272 2,235,037 1,999,180 1,863,944 1,634,541 1,792,239 1,811,359 Tourism development 2,362,641 2,142,072 2,452,636 978,990 1,506,033 2,422,549 2,102,000 3,316,761 3,120,890 2,909,298 Interest on long-term debt - - - - - - - - 8,214 7,675 Total government activities expenses 10,615,259 12,221,498 12,969,837 12,617,958 16,266,118 16,792,171 17,503,805 17,683,368 14,387,639 14,611,550 Business-type activities:Water and sewer 2,297,772 2,103,739 2,190,286 1,969,385 2,333,837 2,073,516 2,244,663 3,509,216 2,800,180 2,527,403 Total business-type activities 2,297,772 2,103,739 2,190,286 1,969,385 2,333,837 2,073,516 2,244,663 3,509,216 2,800,180 2,527,403 Total primary government expenses 12,913,031 14,325,237 15,160,123 14,587,343 18,599,955 18,865,687 19,748,468 21,192,584 17,187,819 17,138,953 Program revenues:Government activities:Charges for services:General government 2,065,901 1,228,044 984,185 1,248,280 1,004,122 2,279,462 6,791,483 2,480,346 2,711,878 3,086,654 Public safety 2,087 921,937 705,182 933,440 3,656,805 705,555 983,943 1,709,421 645,339 904,073 Community services 3,925 - - - - - - - 115,466 193,847 Operating grants and contributions - - - - - - - 534,769 - - Capital grants and contributions 140,835 249,851 175,055 140,279 131,810 - - 120,623 - 243,000 Total governmental activities and program revenues 2,212,748 2,399,832 1,864,422 2,321,999 4,792,737 2,985,017 7,775,426 4,845,159 3,472,683 4,427,574 Business-type activities:Charges for servicesWater and sewer 1,991,042 2,120,780 2,080,225 2,127,072 2,574,012 2,866,202 3,486,412 3,657,474 3,351,332 3,547,076 Capital grants and contributions - - - - - - - - 259,470 - Total business-type activities program revenues 1,991,042 2,120,780 2,080,225 2,127,072 2,574,012 2,866,202 3,486,412 3,657,474 3,610,802 3,547,076 Total primary government program revenues 4,203,790 4,520,612 3,944,647 4,449,071 7,366,749 5,851,219 11,261,838 8,502,633 7,083,485 7,974,650 (Continued)BAL HARBOUR VILLAGE, FLORIDACHANGES IN NET POSITIONLAST TEN FISCAL YEARS(Accrual Basis of Accounting)81
Table 22005200620072008200920102011201220132014Net (expense) revenue:Business type activities (306,730) 17,041 (110,061) 157,687 240,175 792,686 1,241,749 148,258 810,622 1,019,673 Total primary government net expense (306,730) 17,041 (110,061) 157,687 240,175 792,686 1,241,749 148,258 810,622 1,019,673 General revenues and other changes in net assets:Governmental activitiesTaxes:Ad-valorem taxes 4,275,240 5,146,237 6,070,684 5,470,218 5,792,561 5,703,452 5,819,371 5,801,487 6,797,002 6,781,637 Franchise fees based on gross receipts and utility taxes 1,425,667 1,467,269 1,519,205 1,255,883 1,270,011 1,209,905 1,319,539 1,745,365 1,463,181 1,688,621 Unrestricted intergovernmental revenue 267,568 331,003 333,724 554,727 616,943 282,772 301,734 659,868 580,399 638,806 Special assessments 365,504 210,303 232,166 212,513 - - - - - Tourism tax 2,570,155 2,307,901 1,712,220 805,262 848,975 876,700 1,131,882 2,118,487 3,229,946 3,600,359 Unrestricted investment earnings 261,755 537,823 643,888 315,739 43,665 107,731 56,502 65,632 33,000 29,531 Miscellaneous 65,808 143,722 988,969 4,007,410 3,928,477 4,620,851 2,513,442 838,409 165,772 992,008 Transfers 60,000 - - 60,000 60,000 60,000 60,000 60,000 60,000 60,000 Total governmental activities 9,291,697 10,144,258 11,500,856 12,681,752 12,560,632 12,861,411 11,202,470 11,289,248 12,329,300 13,790,962 Business-type activitiesUnrestricted investment earnings 89,698 139,063 177,096 66,157 3,715 37,229 18,393 48,636 20,312 5,643 Miscellaneous - - 3,441 - - - - - - - Transfers (60,000) - - (60,000) (60,000) (60,000) (60,000) (60,000) (60,000) (60,000) Total business-type activities 29,698 139,063 180,537 6,157 (56,285) (22,771) (41,607) (11,364) (39,688) (54,357) Total primary government 9,321,395 10,283,321 11,681,393 12,687,909 12,504,347 12,838,640 11,160,863 11,277,884 12,289,612 13,736,605 Change in net positionGovernmental activities 523,682 112,289 163,275 2,173,280 1,087,251 (693,183) 1,643,494 (1,548,961) 1,414,344 3,606,946 Business-type activities (277,032) 156,104 70,476 163,844 183,890 769,915 1,200,142 136,894 770,934 965,316 Total primary government 246,650$ 268,393$ 233,751$ 2,337,124$ 1,271,141$ 76,732$ 2,843,636$ (1,412,067)$ 2,185,278$ 4,572,262$ LAST TEN FISCAL YEARS(Accrual Basis of Accounting)BAL HARBOUR VILLAGE, FLORIDACHANGES IN NET POSITION(Continued)82
Table 32005200620072008200920102011201220132014General fund:Reserved 2,143,477$ 3,212,537$ 2,776,093$ 2,700,742$ 38,357$ 574$ -$ -$ -$ -$ Unreserved 4,523,367 3,903,988 5,011,338 6,078,747 9,073,308 9,788,636 - - - - Restricted - - - - - - - - 328,373 306,477 Non-spendable - - - - - - 60,569 70,569 5,000 3,199 Assigned - - - - - - 1,268,500 2,350,075 2,147,395 2,505,746 Unassigned - - - - - - 8,400,416 8,158,253 8,348,881 10,904,188 Total general fund 6,666,844$ 7,116,525$ 7,787,431$ 8,779,489$ 9,111,665$ 9,789,210$ 9,729,485$ 10,578,897$ 10,829,649$ 13,719,610$ All other government funds:Reserved, reported in:Law enforcement trust 132,312$ 256,764$ 298,376$ 65,113$ 489,211$ 551,200$ -$ -$ -$ Tourist 1,200,000 1,495,416 1,219,900 1,300,000 1,200,000 1,200,000 - - - Other governmental funds 337,065 168,208 178,417 474,507 1,291,976 85,774 - - - Unreserved, reported in:Tourism fund 936,135 962,608 925,637 2,036,164 2,459,733 1,956,929 - - - Other governmental funds - - - - 43,806 38,896 - - - Restricted - - - - - - 6,190,902 4,147,049 4,736,524 5,564,658 Total all other governmental funds 2,605,512$ 2,882,996$ 2,622,330$ 3,875,784$ 5,484,726$ 3,832,799$ 6,190,902$ 4,147,049$ 4,736,524$ 5,564,658$ BAL HARBOUR VILLAGE, FLORIDAFUND BALANCES OF GOVERNMENTAL FUNDSLAST TEN FISCAL YEARS(Modified Accrual Basis of Accounting)83
Table 42005200620072008200920102011201220132014Revenues:Ad valorem taxes 4,275,240$ 5,146,237$ 6,070,684$ 5,470,218$ 5,792,561$ 5,703,452$ 5,819,371$ 5,801,487$ 6,797,002$ 6,781,637$ Utility taxes and franchise fees 1,425,667 1,467,269 1,519,205 1,536,918 1,616,856 1,556,139 1,625,714 1,745,365 1,784,020 2,005,201 Licenses and permits 1,100,109 833,033 728,216 960,400 748,641 724,981 753,931 934,557 1,004,325 1,598,837 Special assessments 365,504 210,303 232,166 212,513 227,555 230,802 252,517 775,357 932,338 614,015 Intergovernmental 408,403 580,854 508,780 413,971 450,190 421,538 6,146,266 1,315,260 375,026 516,073 Charges for services 109,994 184,708 23,801 75,367 27,926 94,055 88,700 770,432 775,215 873,802 Tourist tax 2,570,155 2,307,901 1,712,220 805,262 848,975 876,700 1,131,882 2,118,487 3,229,946 3,600,359 Fines and forfeitures 496,306 921,937 534,387 750,151 3,510,922 1,905,226 952,229 1,680,847 642,947 869,783 Investment earnings 261,755 537,823 644,222 316,209 43,758 107,846 56,700 86,484 33,157 28,403 Developer contribution - - 615,550 3,927,870 3,853,352 4,199,068 2,134,501 733,730 87,009 965,561 Grants - - - - - 113,794 21,206 - - 243,000 Miscellaneous 65,808 143,722 543,882 262,359 220,915 105,387 104,282 112,401 80,998 61,855 Total revenues 11,078,941 12,333,787 13,133,113 14,731,238 17,341,651 16,038,988 19,087,299 16,074,407 15,741,983 18,158,526 Expenditures:General government 2,399,941 2,905,561 2,727,983 3,797,563 4,273,094 3,954,502 3,885,014 3,389,462 3,766,627 3,948,411 Public safety 4,087,060 4,895,017 5,144,453 5,510,777 7,083,645 7,733,568 8,732,822 8,960,847 5,471,270 5,620,615 Solid waste 699,886 819,910 1,213,386 1,185,033 1,177,483 985,904 965,682 774,206 613,773 613,773 Road and streets 331,042 524,835 496,152 478,889 603,397 608,143 491,071 438,505 819,193 787,614 Parks and recreation 245,912 378,590 483,017 326,092 393,414 364,497 354,706 374,765 331,742 389,739 Tourism development 2,336,037 2,082,623 2,372,955 897,215 1,424,258 2,344,312 2,014,907 3,251,469 3,114,011 2,902,419 Capital outlay 113,913 86 284,927 350,258 505,242 1,082,444 404,719 69,488 815,299 208,299 Debt service payments - - - - - - - - 29,841 29,571 Total expenditures 10,213,791 11,606,622 12,722,873 12,545,827 15,460,533 17,073,370 16,848,921 17,258,742 14,961,756 14,500,441 Excess (deficiency) of revenue over expenditures 865,150 727,165 410,240 2,185,411 1,881,118 (1,034,382) 2,238,378 (1,184,335) 780,227 3,658,095 Other financing sources (uses):Bonds Issued - - - - - - - 350,000 - - Transfers in 120,000 30,000 49,380 686,647 120,000 120,000 283,000 120,000 120,000 120,000 Transfers out (60,000) (30,000) (49,380) (626,647) (60,000) (60,000) (223,000) (60,000) (60,000) (60,000) Total other financing sources (uses) 60,000 - - 60,000 60,000 60,000 60,000 410,000 60,000 60,000 Net change in fund balance 925,150$ 727,165$ 410,240$ 2,245,411$ 1,941,118$ (974,382)$ 2,298,378$ (774,335)$ 840,227$ 3,718,095$ Debt service as a percentage of noncapital expenditures 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.21% 0.21%BAL HARBOUR VILLAGE, FLORIDACHANGES IN FUND BALANCES OF GOVERNMENTAL FUNDSLAST TEN FISCAL YEARS(Modified Accrual Basis of Accounting)84
Table 5
Fiscal Year Tax Ad Franchise
Ended Roll Valorem Fees and Tourism
September 30,Year Taxes Utility Taxes Tax Total
2005 2004 4,275,240$ 1,425,667$ 2,570,155$ 8,271,062$
2006 2005 5,146,237 1,467,269 2,307,901 8,921,407
2007 2006 6,070,684 1,519,205 1,712,220 9,302,109
2008 2007 5,470,218 1,536,918 805,262 7,812,398
2009 2008 5,792,561 1,270,011 848,975 7,911,547
2010 2009 5,703,452 1,556,139 876,700 8,136,291
2011 2010 5,819,371 1,625,714 1,131,882 8,576,967
2012 2011 5,801,487 1,745,365 2,118,487 9,665,339
2013 2012 6,797,002 1,784,020 3,229,946 11,810,968
2014 2013 6,781,637 2,005,201 3,600,359 12,387,197
BAL HARBOUR VILLAGE, FLORIDA
GOVERNMENTAL ACTIVITIES TAX REVENUES BY SOURCE
LAST TEN FISCAL YEARS
(Accrual Basis of Accounting)
85
Table 6Fiscal Year Licenses Charges FinesEnded Inter- and for and Investment DeveloperSeptember 30, TaxesGovernmentalPermitsServiceForfeituresEarningsOtherContributionTotal 2005 8,271,062$ 408,403$ 1,100,109$ 475,498$ 496,306$ 261,755$ 65,808$ -$ 11,078,941$ 2006 8,921,407 580,854 833,033 395,011 921,937 537,823 143,722 - 12,333,787 2007 9,302,109 508,780 728,216 255,967 534,387 644,222 1,159,432 - 13,133,113 2008 7,812,398 413,971 960,400 287,880 750,151 316,209 4,190,229 - 14,731,238 2009 7,409,417 450,190 748,641 27,926 3,510,922 43,758 220,915 3,853,352 16,265,121 2010 7,259,591 535,332 724,981 83,855 639,408 85,430 70,565 3,226,058 12,625,220 2011 7,445,085 471,137 753,931 82,861 874,388 43,710 67,005 1,112,840 10,850,957 2012 7,546,852 780,491 934,557 759,772 507,366 48,525 87,318 93,544 10,758,425 2013 8,581,022 375,026 1,004,325 745,540 642,947 28,546 48,777 87,009 11,513,192 2014 8,786,838 516,073 1,598,837 827,112 869,783 24,568 269,227 965,561 13,857,999 BAL HARBOUR VILLAGE, FLORIDAGENERAL GOVERNMENTAL REVENUES BY SOURCELAST TEN FISCAL YEARS86
Table 7Total Total Net AssessedEstimated Net Direct Value as a PercentageCalendar Residential Commercial Personal Other Actual Assessed Tax of EstimatedYearPropertyPropertyPropertyPropertyValueExemptionsValueRate (a)Actual Value2005 1,671,731,845$ 288,343,637$ 31,170,342$ 93,742,490$ 2,084,988,314$ 243,578,098$ 1,841,410,216$ 2.9020 88.32%2006 1,996,571,375 331,587,932 34,697,709 134,442,006 2,497,299,022 331,848,279 2,165,450,743 2.9020 86.71%2007 2,217,338,562 233,483,875 36,674,464 366,007,730 2,853,504,631 443,041,444 2,410,463,187 2.3195 84.47%2008 2,712,190,035 244,084,477 37,042,751 193,679,959 3,186,997,222 374,853,616 2,812,143,606 2.3085 88.24%2009 2,259,771,171 311,231,422 37,851,072 204,425,521 2,813,279,186 291,373,689 2,521,905,497 2.5265 89.64%2010 2,225,895,282 474,032,012 37,857,036 75,448,210 2,813,232,540 292,917,689 2,520,314,851 2.5567 89.59%2011 2,502,756,122 276,791,876 44,894,243 59,084,285 2,883,526,526 292,917,689 2,590,608,837 2.4468 89.84%2012 2,188,130,203 250,911,836 40,696,631 134,178,126 2,613,916,796 273,296,550 2,343,445,178 2.4468 89.65%2013 2,823,731,833 566,152,958 35,164,780 91,428,428 3,516,477,999 348,237,714 3,168,240,285 2.2678 90.10%2014 2,823,731,833 566,152,958 35,164,780 91,428,428 3,516,477,999 348,237,714 3,168,240,285 1.9192 90.10% (a) Miami Dade Property Appraiser,, Florida Department of RevenueNote: Property taxes are for a calendar year, while tax rates are for fiscal years 2013 data is depicted for 2014.BAL HARBOUR VILLAGE, FLORIDAASSESSED VALUE AND ESTIMATED ACTUAL ASSESSED VALUE OF TAXABLE PROPERTYLAST TEN CALENDAR YEARS87
Table 8Percentage PercentageTaxable of Total Taxable of TotalAssessed Taxable Assessed TaxableValueRankAssessed ValueValueRank2Assessed ValueSt. Regis Hotel and Condominiums 862,642,636$ 1 27.23% 68,275,824$ 4.53%Elcom Condo LLC (One Bal Harbour Complex) 366,127,396 2 11.56% 46,045,900 3.05%The Majestic Complex 194,031,412 3 6.12% NA NABal Harbour Shops Complex 164,779,582 4 5.20% 103,768,608 6.88%Bal Harbour Tower Complex 164,779,582 5 5.20% NA NABal Moral Complex 163,916,380 6 5.17% NA NATRG Harbour House Ltd Complex 134,271,149 7 4.24% NA NACarolton Terrace Complex 134,072,772 8 4.23% NA NAThe Bellini Complex 120,211,536 9 3.79% NA NAThe Palace Complex 115,141,664 10 3.63%NA NA Total 2,419,974,109$ 76.38%218,090,333$ 14.47%Notes:1. Beginning with FY 2013, the Village has aggregated ownerships of parcels within one structure or complex.2. Rankings not provided as information for aggregation was not available at time of publication.NA: FY 2014 and FY 2005 information was not accessible.BAL HARBOUR VILLAGE, FLORIDAPRINCIPAL PROPERTY TAXPAYERSCURRENT YEAR AND NINE YEARS AGOFiscal Year 2013 Fiscal Year 200488
Table 9Collection in SubsequentYearFiscal Percentage PercentageYear Ended Gross Net of ofSeptember 30,LevyDiscountLevyAmountLevyAmountNet Levy2005 4,419,442$ 176,778$ 4,242,664$ 4,221,451$ 99.50% 5,281$ 4,226,732$ 99.62%2006 5,346,751 213,870 5,132,881 5,091,818 99.20% 7,691 5,099,509 99.35%2007 6,286,718 251,469 6,035,249 5,962,826 98.80% 12,696 5,975,522 99.01%2008 5,628,277 225,131 5,403,146 5,316,696 98.40% 14,107 5,330,803 98.66%2009 6,426,294 257,052 6,169,242 6,039,688 97.90% 10,032 6,049,720 98.06%2010 6,367,575 254,703 6,112,872 5,655,373 91.46% 144,789 5,800,162 94.88%2011 6,056,828 242,273 5,814,555 5,766,067 95.20% 118,880 5,884,947 101.21%2012 5,733,942 229,358 5,504,584 5,710,150 99.59% 33,766 5,743,916 104.35%2013 7,194,529 287,781 6,906,748 6,637,686 92.26% NA 6,637,686 96.10%2014 7,009,092 303,842 6,705,250 6,705,250 95.67% NA 6,705,250 100.00%Total Collections to Datethe Fiscal YearTaxes Levied for Fiscal Year of the LevyCollected within the BAL HARBOUR VILLAGE, FLORIDAPROPERTY TAX LEVIES AND COLLECTIONSLAST TEN FISCAL YEARS($ in 000's)89
Table 10Direct RateVillageSouthFlorida Florida Total DirectFiscal Tax Debt Water Inland Debt andYear Ended Roll Operating and Operating Service Everglades Management Navigation Operating Service Children's Fire & Fire OverlappingSeptember 30,YearTotal MillageMillageMillageProjectDistrictDistrictMillageMillageTrustRescueDebtRates2005 2004 2.9020 7.9470 0.4910 0.1000 0.5970 0.0385 5.8350 0.2850 0.4288 2.6090 0.0520 21.28532006 2005 2.9020 7.6910 0.4140 0.1000 0.5970 0.0385 5.6150 0.2850 0.4223 2.6090 0.0420 20.71582007 2006 2.3195 7.5700 0.3780 0.0894 0.5346 0.0345 4.5796 0.2850 0.4223 2.2067 0.0420 18.46162008 2007 2.3085 7.5330 0.2640 0.0894 0.5346 0.0345 4.8379 0.2850 0.4212 2.1851 0.0420 18.53522009 2008 2.5265 7.6980 0.2970 0.0894 0.5346 0.0345 4.8379 0.2850 0.5000 2.1851 0.0420 19.03002010 2009 2.5567 7.8640 0.3850 0.0894 0.5346 0.0345 5.4275 0.4450 0.5000 2.5753 0.0200 20.43202011 2010 2.4468 7.7650 0.2400 0.0624 0.3739 0.0345 4.8050 0.2850 0.5000 2.4496 0.0131 18.97532012 2011 2.4468 7.7650 0.2400 0.0613 0.3676 0.0345 4.7035 0.2850 0.5000 2.4496 0.0131 18.86642013 2012 2.2678 7.765 0.2330 0.0613 0.3676 0.0345 4.7035 0.2850 0.5000 2.4496 0.0131 18.68042014 2013 1.9192 7.644 0.3330 0.0587 0.3523 0.0345 4.7035 0.4220 0.5000 2.4496 0.0124 18.4292Source: Miami-Dade Property Appraiser's OfficeSchool District StateMiami-Dade CountySpecial DistrictsOverlapping RatesBAL HARBOUR VILLAGE, FLORIDAPROPERTY TAX RATESDIRECT AND OVERLAPPING GOVERNMENTS(Per $1,000 of Taxable Value)LAST TEN FISCAL YEARS90
Table 11FiscalPer PercentageYear General Outstanding Total Capita of TotalEnded Obligation Revenue Line of Non-GO Primary Personal Personal Net DebtSeptember 30, (GO) BondsBondsCreditBondsGovernmentIncome (1)IncomePopulation**per Capita2005 -$ -$ -$ 199,811$ 199,811$ 38,259$ 0.16% 3,185 63 2006 - - - 162,884 162,884 41,204 0.13% 2,973 55 2007 - - - 124,498 124,498 54,512 0.07% 3,058 41 2008 - - - 84,596 84,596 54,512 0.05% 3,299 26 2009 - - - - - 54,512 0.00% 3,320 - 2010 - - - - - 54,512 0.00% 3,320 - 2011 - - - - - 54,512 0.00% 2,515 - 2012 - 350,000 - 9,039,725 9,389,725 54,512 5.79% 2,976 3,155 2013 - 328,373 - 8,443,447 8,771,820 63,718 3.98% 3,457 2,537 2014 - 304,953 7,841,243 8,146,196 63,718 3.70% 3,457 2,356 Notes: Details regarding the Village's outstanding debt can be found in the notes to the financial statements.(1) See the Schedule of Demographics and Economic Statistics for personal income and population data.(c) Per Capita Personal Income Restated for Years 2007-2012 for U.S. Census American Community Survey; 2013 uses ESRI dataBAL HARBOUR VILLAGE, FLORIDARATIOS OF OUTSTANDING DEBT BY TYPELAST TEN FISCAL YEARSGovernmental ActivitiesBusiness-typeActivities 91
Table 12Less:Fiscal Amounts Assessed Ratio of NetYear Gross Available in Net Value of Net Bonded BondedEnded Bonded Debt Service Bonded Taxable Debt to Debt perSeptember 30,DebtFundsDebtPropertyAssessed ValuePopulationCapita (1)2005 199,811$ -$ 199,811$ 1,841,410,216$ 0.011% 3,185 63 2006 162,884 - 162,884 2,165,450,743 0.008% 2,973 55 2007 124,498 - 124,498 2,410,463,187 0.005% 3,058 41 2008 84,596 - 84,596 2,812,143,606 0.003% 3,299 26 2009 - - - 2,521,905,497 0.000% 3,320 - 2010 - - - 2,520,314,851 0.000% 2,515 - 2011 - - - 2,590,608,837 0.000% 2,515 - 2012 9,389,725 - 9,389,725 2,613,916,796 0.359% 2,976 3,155 2013 8,771,820 - 8,771,820 3,172,470,734 0.276% 3,457 2,537 2014 8,146,196 - 8,146,196 3,652,782,693 0.223% 3,457 2,356 BAL HARBOUR VILLAGE, FLORIDARATIOS OF BONDED DEBT OUTSTANDINGLAST TEN FISCAL YEARS92
Table 13
Estimated
Percentage Estimated
Applicable to Share of
Town of Bal Direct &
Debt Harbour Overlapping
Jurisdiction Outstanding Village (1)Debt
Direct
Bal Harbour Village 8,146,196$ 100.00% 8,146,196$
Overlapping:
Miami-Dade Board of County Commissioners (2) 16,649,835,000 1.67% 277,279,660
Miami-Dade County School Board (2) 443,784,000 1.54% 6,847,246
Total direct and overlapping 17,101,765,196$ 292,273,102$
Notes:
(1) Based on ratio of assessed taxable value obtained from Miami-Dade County Property Appraiser 2013.
(2) Source: Miami-Dade County, Florida, Finance Department 2013.
The Village Charter does not establish a legal debt limit nor does the Florida Statutes impose a limit.
BAL HARBOUR VILLAGE, FLORIDA
DIRECT AND OVERLAPPING GOVERNMENTAL ACTIVITY DEBT
SEPTEMBER 30, 2014
93
Table 14
Note: Neither the Village Charter nor State Law establish a legal debt margin.
BAL HARBOUR VILLAGE, FLORIDA
LEGAL DEBT MARGIN INFORMATION
LAST TEN FISCAL YEARS
94
Table 15Fiscal Year Ended September 30,Pledged RevenuesAdditional Appropriated Revenues, Not From Ad Valorem, Water and Sewer SystemAdditional Appropriated Revenues, Not From Ad Valorem, General FundTotal Revenue Pledged or AppropriatedTotal Debt Service RequiredCoverageRequired Coverage2012 236,983$ 846,340$ -$ 1,083,323$ 846,340$ 1.28 0.002013 245,818 822,757 - 1,068,575 852,598 1.25 0.002014 303,065 815,305 1,118,370 844,876 1.32 0.001. Pledged Revenues Include State Revenue Sharing, 1/2¢ Sales Tax Sharing, and Alcoholic BeverageLicense Shared Revenues.2. To the extend pledged revenues are insufficient, the Village promises to budget and appropriate anydifference.3. The debt was originally issued for both Water and Sewer capital needs and General Fund capital needs.BAL HARBOUR VILLAGE, FLORIDAPLEDGED REVENUE COVERAGE, CAPITAL IMPROVEMENT REVENUE BONDS, SERIES 2011LAST TEN FISCAL YEARS95
Table 16Calendar School Unemployment PerYearVillageCountyEnrollmentRateTotalCapita2005 3,185 2,412,035 365,784 4.2% 121,854,915$ 38,259$ 2006 2,973 2,426,934 361,550 3.6% 122,499,492 41,204 2007 3,058 2,451,850 353,283 4.1% 166,697,696 54,512 2008 3,299 2,466,827 347,774 5.8% 179,835,088 54,512 2009 3,320 2,472,344 345,150 9.6% 180,979,840 54,512 2010 3,320 2,496,435 345,458 12.4% 180,979,840 54,512 2011 2,515 2,496,435 347,133 12.0% 137,097,680 54,512 2012 2,976 2,541,928 349,945 9.4% 162,227,712 54,512 2013 3,457 2,540,172 353,152 8.4% 220,273,126 63,718 2014 3,457 2,540,172 353,152 8.4% 220,273,126 63,718 Notes:(a) Source: Bureau of Economic and Business Research, University of Florida(c) Source: St. Louis Federal Reserve Bank, Miami - Fort Lauderdale MSA(b) Source: School Board of Broward County (county wide)(d) Source: U.S. Department of Labor - Annual Rate(e) 2007-2012 for U.S. Census American Community Survey(f)ESRI®U.S. Census Bureau, Census 2010 Summary File 1. Esri forecasts for 2013.Esri converted Census 2000 data into 2010 geography.BAL HARBOUR VILLAGE, FLORIDADEMOGRAPHIC AND ECONOMIC STATISTICSLAST TEN CALENDAR (OR FISCAL) YEARSPopulationPersonal Income***(Expressed in Thousands)96
Table 17Percentage of Percentage ofTotal County Total CountyEmployerEmployeesRankEmploymentEmployeesRankEmploymentMiami-Dade County Public Schools 41,988 1 3.28% 46,864 1 4.27%Miami-Dade County 29,000 2 2.27% 32,265 2 2.94%U.S. Federal Government 19,500 3 1.52% 20,100 3 1.83%State of Florida 17,100 4 1.34% 18,900 4 1.72%University of Miami 16,000 5 1.25% 9,367 7 0.85%Baptist Health Systems of South Florida 13,376 6 1.05% 10,300 6 0.94%Jackson Health System 12,571 7 0.98% 11,700 5 1.07%Publix Supermarket 10,800 8 0.84% - - - American Airlines 9,000 9 0.70% 9,000 8 0.82%Florida International University 8,000 10 0.63% 5,000 10 0.46%Miami-Dade College - - - 7,500 9 0.68% Total Labor Force Employment 1,279,047 15.16%1,097,454 14.86%Source: The Beacon Council, Miami, Florida, Miami Business Profile.Note: Principal employer data not available at the Village level, therefore data for Miami-Dade County was used.FY 2005 information was not accessible.2014 2004BAL HARBOUR VILLAGE, FLORIDAPRINCIPAL EMPLOYERSCURRENT AND NINE YEARS AGO97
Table 182005200620072008200920102011201220132014General government:Non-sworn personnel 35 34 34 34 34 31 30 30 38 38Square miles .6 miles .6 miles .6 miles .6 miles .6 miles .6 miles .6 miles .6 miles .6 miles .6 milesElections: 1 1 1 0110000Registered voters 1,578 1,460 Data Unavailable 1,661 1,631 1,631 1,631 1,631 1,631Votes cast in last election 762 503 Data Unavailable 419 2510000Ordinances prepared and adopted 9 10 11 8886699Resolutions prepared and adopted11 14 8 6 14 16 12 17 10 10Commission minutes prepared/approved 15 17 17 17 26 21 26 15 20 20Public safety:PoliceStations 1 1 1 1111111Uniformed employees 31 33 28 26 26 25 25 25 22 22Calls for service handled 3,199 2,639 2,433 2,345 2,553 3,302 3,165 3,644 3,929 4,542Traffic accidents handled 151 148 130 148 129 133 142 135 116 126Traffic citations/warnings issued 9,345 6,823 11,911 10,298 7,915 4,428 4,433 4,438 4,090 3,982Part 1 crimes reported 88 97 72 57 70 85 66 80 75 75Arrests 112 89 91 62 63 55 54 51 50 50Building:Permits issued 897 2484 1718 862 650 1123 1426 1258Value of construction 19,808,669 909,022,971 48,920,059 15,095,972 12,650,022 21,849,415 42,119,493 79,100,703Business tax receipts issued 107 119 115 123 126 124 133 133 106 253Physical environment:Miles of streets 3.03 miles 3.03 miles 3.03 miles 3.03 miles 3.03 miles 3.03 miles 3.03 miles 3.03 miles 3.03 miles 3.03 milesCulture/recreation:Facilities 2 2 2 2222222Park acreage .44 acres .44 acres .44 acres .44 acres .44 acres .44 acres .44 acres .44 acres .44 acres .44 acresSource:Various Village departmentsPart 1 crimes include homicide, sex offenses, robbery, aggravated assault, burglary, larceny, arson and auto theft.Police and Building elements estimated for 2012Data UnavailableFunction/ProgramData UnavailableBAL HARBOUR VILLAGE, FLORIDAOPERATING INDICATORS BY FUNCTION/PROGRAMLAST TEN FISCAL YEARS98
Table 192005200620072008200920102011201220132014Government activities:General government:Miles of streets 3.03 3.03 3.03 3.03 3.03 3.03 3.03 3.03 3.03 3.03Square feet of buildings 21,200 s.f. 21,200 s.f. 21,200 s.f. 21,200 s.f. 21,200 s.f. 21,200 s.f. 21,200 s.f. 21,200 s.f. 21,200 s.f. 21,200 s.f.Public safety:Number of police stations1111111111Acres of parks .44 acres .44 acres .44 acres .44 acres .44 acres .44 acres .44 acres .44 acres .44 acres .44 acresNumber of parks1111111111Acres of beaches 12.73 acres 12.73 acres 12.73 acres 12.73 acres 12.73 acres 12.73 acres 12.73 acres 12.73 acres 12.73 acres 12.73 acresSource: Village of Bal HarbourBAL HARBOUR VILLAGE, FLORIDACAPITAL ASSET STATISTICS BY FUNCTION/PROGRAM99
REPORTING SECTION
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INDEPENDENT AUDITORS’ REPORT ON INTERNAL CONTROL OVER
FINANCIAL REPORTING AND ON COMPLIANCE AND OTHER MATTERS BASED
ON AN AUDIT OF FINANCIAL STATEMENTS PERFORMED IN ACCORDANCE
WITH GOVERNMENT AUDITING STANDARDS
Honorable Mayor, Village Council and Village Manager
Bal Harbour Village, Florida
We have audited, in accordance with the auditing standards generally accepted in the United
States of America and the standards applicable to financial audits contained in Government
Auditing Standards issued by the Comptroller General of the United States, the financial
statements of the governmental activities, the business-type activities, each major fund, and the
aggregate remaining fund information of Bal Harbour Village, Florida (the Village) as of and for
the fiscal year ended September 30, 2014, and the related notes to the financial statements, which
collectively comprise Village’s basic financial statements, and have issued our report thereon
dated February 13, 2015.
Internal Control Over Financial Reporting
In planning and performing our audit of the financial statements, we considered the Village’s
internal control over financial reporting (internal control) to determine the audit procedures that
are appropriate in the circumstances for the purpose of expressing our opinions on the financial
statements, but not for the purpose of expressing an opinion on the effectiveness of the Village’s
internal control. Accordingly, we do not express an opinion on the effectiveness of the Village’s
internal control.
A deficiency in internal control exists when the design or operation of a control does not allow
management or employees, in the normal course of performing their assigned functions, to
prevent, or detect and correct, misstatements on a timely basis. A material weakness is a
deficiency, or a combination of deficiencies, in internal control, such that there is a reasonable
possibility that a material misstatement of the entity’s financial statements will not be prevented,
or detected and corrected on a timely basis. A significant deficiency is a deficiency, or a
combination of deficiencies, in internal control that is less severe than a material weakness, yet
important enough to merit attention by those charged with governance.
Our consideration of internal control was for the limited purpose described in the first paragraph
of this section and was not designed to identify all deficiencies in internal control that might be
material weaknesses or significant deficiencies. Given these limitations, during our audit we did
not identify any deficiencies in internal control that we consider to be material weaknesses.
However, material weaknesses may exist that have not been identified.
101
Compliance and Other Matters
As part of obtaining reasonable assurance about whether the Village’s financial statements are
free from material misstatement, we performed tests of its compliance with certain provisions of
laws, regulations, contracts, and grant agreements, noncompliance with which could have a
direct and material effect on the determination of financial statement amounts. However,
providing an opinion on compliance with those provisions was not an objective of our audit, and
accordingly, we do not express such an opinion. The results of our tests disclosed no instances
of noncompliance or other matters that are required to be reported under Government Auditing
Standards.
Purpose of this Report
The purpose of this report is solely to describe the scope of our testing of internal control and
compliance and the results of that testing, and not to provide an opinion on the effectiveness of
the entity’s internal control or on compliance. This report is an integral part of an audit
performed in accordance with Government Auditing Standards in considering the entity’s
internal control and compliance. Accordingly, this communication is not suitable for any other
purpose.
Miami, FL
February 13, 2015
Marcum LLP n One Southeast Third Avenue n Suite 1100 n Miami, Florida 33131 n Phone 305-995-9600 n Fax 305-995-9601
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102
MANAGEMENT LETTER IN ACCORDANCE WITH THE RULES OF THE
AUDITOR GENERAL OF THE STATE OF FLORIDA
Honorable Mayor, Village Council and Village Manager
Bal Harbour Village, Florida
Report on the Financial Statements
We have audited the financial statements of the Bal Harbour Village, Florida (the Village), as of
and for the fiscal year ended September 30, 2014, and have issued our report thereon dated
February 13, 2015.
Auditors’ Responsibility
We conducted our audit in accordance with auditing standards generally accepted in the United
States of America; the standards applicable to financial audits contained in Government Auditing
Standards, issued by the Comptroller General of the United States; and Chapter 10.550, Rules of
the Auditor General.
Other Reports and Schedule
We have issued our Independent Auditors’ Report on Internal Control over Financial Reporting
and Compliance and Other Matters Based on an Audit of the Financial Statements Performed in
Accordance with Government Auditing Standards; and Independent Accountants’ Report on an
examination conducted in accordance with AICPA Professional Standards, Section 601,
regarding compliance requirements in accordance with Chapter 10.550, Rules of the Auditor
General. Disclosures in those reports and schedule, which are dated February 13, 2015, should
be considered in conjunction with this management letter.
Official Title and Legal Authority
Section 10.554(1)(i)4., Rules of the Auditor General, requires that the name or official title and
legal authority for the primary government and each component unit of the reporting entity be
disclosed in this management letter, unless disclosed in the notes to the financial statements. The
Village has made these disclosures in the notes to the financial statements. The Village did not
have any component units for the fiscal year ended September 30, 2014.
103
Financial Condition
Section 10.554(1)(i)5.a., Rules of the Auditor General, requires that we report the results of our
determination as to whether or not the Village has met one or more of the conditions described in
Section 218.503(1), Florida Statutes, and identification of the specific condition(s) met. In
connection with our audit, we determined that the Village did not meet any of the conditions
described in Section 218.503(1), Florida Statutes. In connection with our audit, we determined that
the Village did not meet any of the conditions described in Section 218.503(1), Florida Statutes.
Pursuant to Sections 10.554(1)(i)5.c. and 10.556(8), Rules of the Auditor General, we applied
financial condition assessment procedures. It is management’s responsibility to monitor the
Village’s financial condition, and our financial condition assessment was based in part on
representations made by management and the review of financial information provided by same.
This assessment was done as of the fiscal year end.
Annual Financial Report
Section 10.554(1)(i)5.b., Rules of the Auditor General, requires that we report the results of our
determination as to whether the annual financial report for the Village for the fiscal year ended
September 30, 2014, filed with the Florida Department of Financial Services pursuant to Section
218.32(1)(a), Florida Statutes, is in agreement with the annual financial audit report for the fiscal
year ended September 30, 2014. In connection with our audit, we determined that these two reports
were in agreement.
Other Matters
Section 10.554(1)(i)2., Rules of the Auditor General, requires that we address in the management
letter any recommendations to improve financial management. In connection with our audit, we did
not have any such recommendations.
Section 10.554(1)(i)3., Rules of the Auditor General, requires that we address noncompliance with
provisions of contracts or grant agreements, or abuse, that have occurred, or are likely to have
occurred, that have an effect on the financial statements that is less than material but which warrants
the attention of those charged with governance. In connection with our audit, we did not have any
such findings.
Purpose of this Letter
Our management letter is intended solely for the information and use of the Legislative Auditing
Committee, members of the Florida Senate and the Florida House of Representatives, the Florida
Auditor General, Federal and other granting agencies, the Village Council, and applicable management,
and is not intended to be and should not be used by anyone other than these specified parties.
Miami, FL
February 13, 2015
Marcum LLP n One Southeast Third Avenue n Suite 1100 n Miami, Florida 33131 n Phone 305-995-9600 n Fax 305-995-9601
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104
INDEPENDENT ACCOUNTANTS’ REPORT ON COMPLIANCE
PURSUANT TO SECTION 218.415 FLORIDA STATUTES
INDEPENDENT ACCOUNTANTS’ REPORT
Honorable Mayor, Village Council and Village Manager
Bal Harbour Village, Florida
We have examined Bal Harbour Village’s compliance with Section 218.415 Florida Statutes for
the year ended September 30, 2014. Management is responsible for Bal Harbour Village’s
compliance with those requirements. Our responsibility is to express an opinion on Bal Harbour
Village’s compliance based on our examination.
Our examination was conducted in accordance with Section 601 of the attestation standards
established by the American Institute of Certified Public Accountants and, accordingly, included
examining, on a test basis, evidence about Bal Harbour Village’s compliance with those
requirements and performing such other procedures as we considered necessary in the
circumstances. We believe that our examination provides a reasonable basis for our opinion.
Our examination does not provide a legal determination on Bal Harbour Village’s compliance
with specified requirements.
In our opinion, Bal Harbour Village complied, in all material respects, with the aforementioned
requirements for the year ended September 30, 2014.
This report is intended solely for the information and use of management, Village Council,
others within the Bal Harbour Village and the Auditor General of the State of Florida and is not
intended to be and should not be used by anyone other than these specified parties.
Miami, FL
February 13, 2015