HomeMy Public PortalAboutCAFR 2003.pdfI
COMPREHENSIVE
ANNUAL
FINANCIAL
REPORT
FOR THE FISCAL YEAR
ENDED SEPTEMBER 30, 2003
VILLAGE OF KEY BISCAYNE, FLORIDA
COMPREHENSIVE ANNUAL FINANCIAL REPORT
FISCAL YEAR ENDED SEPTEMBER 30, 2003
Prepared by
THE FINANCE DEPARTMENT
VILLAGE OF KEY BISCAYNE, FLORIDA
COMPREHENSIVE ANNUAL FINANCIAL REPORT
FISCAL YEAR ENDED SEPTEMBER 30, 2002
TABLE OF CONTENTS
PAGE
L INTRODUCTORY SECTION
Letter of Transmittal
Village Officials vi
Certificate of Achievement for Excellence in Financial Reporting vii
Organization Chart viii
IL FINANCIAL SECTION
REPORT OF INDEPENDENT CERTIFIED PUBLIC ACCOUNTANTS 1-2
MANAGEMENT'S DISCUSSION AND ANALYSIS (Required Supplementary Information) 3-10
BASIC FINANCIAL STATEMENTS:
Government -Wide Financial Statements
Statement of Net Assets
Statement of Activities
11
12
Fund Financial Statements:
Governmental Fund Financial Statements
Balance Sheet 13
Statement of Revenues, Expenditures and Changes in Fund Balances 14
Reconciliation of the Statement of Revenues, Expenditures and Changes in
Fund Balances of Governmental Funds to the Statement of Activities 15
Proprietary Fund Financial Statements:
Statement of Net Assets 16
Statement of Revenues, Expenses and Changes in Net Assets 17
Statement of Cash Flows 18
Fiduciary Fund Financial Statements:
Statement of Fiduciary Net Assets 19
Statement of Changes in Fiduciary Net Assets 20
Notes to Basic Financial Statements 21-39
REQUIRED SUPPLEMENTARY INFORMATION (OTHER THAN MD&A)
Budgetary Comparison Schedule — General Fund 40
Notes to Budgetary Comparison Schedule 41
Schedule of Employer Contributions 43
VILLAGE OF KEY BISCAYNE, FLORIDA
TABLE OF CONTENTS
PAGE
HI. COMBINING FINANCIAL STATEMENTS
Combining Statement of Net Assets — Nonmajor Proprietary Funds 44
Combining Statement of Revenues. Expenses and Changes in Net Assets —
Nonmajor Proprietary Funds 45
Combining Statement of Cash Flows — Nonmajor Proprietary Funds 46
IV. STATISTICAL SECTION
Government -Wide Information:
Government -Wide Expenses by Function 47
Government -Wide Revenues 48
Fund Information:
General Governmental Expenditures by Function 49
General Governmental Revenues by Source 50
Utility Tax Revenue By Source; Franchise Fee Revenue by Source 51
Property Tax Levies and Collection 52
Assessed and Estimated Actual Value of Taxable Property 53
Property Tax Rates Direct and Overlapping Governments 54
Ratio of Annual Debt Service Expenditures for Net Bonded Debt to
General Governmental Expenditures 55
Schedule of Direct and Overlapping Debt - General Obligation Bonds 56
Ratio of Net Bonded Debt to Assessed Value and Per Capita 57
Revenue Bond Coverage 58
Demographic Statistics 59
Property Value, Construction and Bank Deposits 60
Principal Taxpayers 61
Miscellaneous Statistical Data 62
V. COMPLIANCE SECTION
Report of Independent Certified Public Accountants on Compliance and on Internal
Controls over Financial Reporting Based on an Audit of Financial Statements
Performed in Accordance with Government Auditing Standards 63
Management Letter in Accordance with the Rules of the Auditor General of the
State of Florida 65
Report of Independent Certified Public Accountants on Compliance Applicable to each
Major Program and on Internal Control over Compliance in accordance with OMB
Circular A-133 67
Schedule of Expenditures of Federal Awards 69
Note to Schedule of Expenditures of Federal Awards 70
Schedule of Findings and Questioned Costs 71
Summary Schedule of Prior Audit Findings 73
INTRODUCTORY SECTION
VILLAGE OF KEY BISCAYNE
Village Council
Robert Oldakowski, Mayor
Jorge E Mendia, Vice Mayor
Martha Fdez-Leon Broucek
Carol Diaz -Castro
Mortimer Fried
James L Peters
Robert L Vernon
March 5, 2004
To the Honorable Mayor, Members of the Village
Council and Citizens of the Village of Key Biscayne:
The Government Finance Officers Association (GFOA) recommends that all
units of local government publish, within six months of the close of each
fiscal year, a complete set of financial statements presented in conformity with
generally accepted accounting principles (GAAP) in the United States and
audited in accordance with auditing standards generally accepted in the United
States and in accordance with Government Auditing Standards by a fnrti of
licensed certified public accountants. Pursuant to that recommendation, we
hereby issue the comprehensive annual financial report of the Village of Key
Biscayne for the fiscal year ended September 30, 2003.
This report consists of management's representation concerning the finances
of the Village of key Biscayne. Consequently, management assumes full
responsibility for the completeness and reliability of all of the information
presented in this report. To provide a reasonable basis for making these
representations, management of the Village of Key Biscayne has established a
comprehensive internal framework that is designed both to protect the
Village's assets from loss, theft, or misuse and to compile sufficient reliable
information for the preparation of the Village of Key Biscayne's financial
statements in conformity with GAAP. Because the cost of internal controls
should not outweigh their benefits, the Village of Key Biscayne's
comprehensive framework of internal controls has been designed to provide
reasonable, rather than absolute, assurance that the financial statements will be
free from material misstatement. As management, we assert that, to the best
of our knowledge and belief, this financial report is complete and reliable in
all material respects.
The fun of Rachlm Cohen & Holtz LLP, licensed certified public accountants
has audited the Village of Key Biscayne's financial statements. The goal of
the independent audit was to provide reasonable assurance that the basic
financial statements of the Village of Key Biscayne for the fiscal year ended
September 30, 2003, are free of material misstatement. The independent audit
involved examining, on a test basis, evidence supporting the amount and
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88 West McIntyre Street • Key Biscayne, Florida 33149 • (305) 365-5506 • Fax (305) 365-8914
MISSION STATEMENT 'TO PROVIDE A SAFE QUALITY COMMUNITY ENVIRONMENT FOR ALL ISLANDERS THROUGH RESPONSIBLE GOVFRNMFN9
Honorable Mayor, Village Council and Citizens
Village of Key Biscayne
disclosures in the financial statements; assessing the accounting principles used and significant
estimates made by management; and evaluating the overall financial statement presentation. The
independent auditor concluded, based upon the audit, that there was a reasonable basis for
rendering an unqualified opinion that the Village of Key Biscayne's financial statements for the
fiscal year ended September 30, 2003, are fairly presented in conformity with GAAP. The
independent auditor's report is presented as the first component of the financial section of this
report.
GAAP requires that management provide a narrative introduction, overview, and analysis to
accompany the basic financial statements in the form of Management's Discussion and Analysis
(MD&A). This letter of transmittal is designed to complement MD&A and should be read in
conjunction with it. The Village of Key Biscayne's MD&A can be found immediately following
the report of the independent certified public accountants.
Profile of the Government
The Village of Key Biscayne, incorporated in 1991, is located on the southern most barrier island
of the United States, Miami Dade County, Florida approximately 7.5 miles off the coast of
Miami, Florida. The Village of Key Biscayne occupies a land area of 1.25 square miles situated
between Crandon Park and Bill Baggs State Recreation Area. The Village serves a population of
approximately 11,100. The Village of Key Biscayne receives tax levies on real and personal
property located inside its boundaries.
The Village of Key Biscayne has operated under the council-manager form of government since
incorporation. Policymaking and legislative authority are vested in a governing council
consisting of the mayor and six other council members. The Council is responsible among other
things, for passing ordinances and resolutions, adopting the annual budget, appointing the Village
Manager and Village Clerk. The Village Manager is responsible for carrying out the policies and
ordinances of the Council, for overseeing the daily operations of the government, and for
appointing the heads of various departments.
The Village of Key Biscayne offers a wide range of services, including, police protection, fire
and emergency medical service, public works maintenance, a full service building, planning and
zoning department, parks and recreation activities, solid waste collection, and a comprehensive
storm water management system. Certain services are provided through the County School
System and the County Library System through Miami -Dade County.
The annual budget serves as a foundation for the Village of Key Biscayne's financial planning
and control. All departments of the Village are required to submit requests for appropriations to
the Village Manager and these requests are the initiation of developing the proposed budget. The
Honorable Mayor, Village Council and Citizens
Village of Key Biscayne
Village Manager then presents this proposed budget to the Council for review. The Council is
required to hold public hearings on the proposed budget and to adopt a final budget no later than
September 30, the close of the Village's fiscal year. The appropriated budget is prepared by fund
and department. No department may legally expend in excess of the amount appropriated for
that department within an individual fund. The Village Manager may make transfers of
appropriations within a department. Transfers of appropriations between departments or between
funds require the approval of the Village Council. The Village Council approves supplemental
appropriations. Budget to actual comparisons are provided in this report for the general fund for
which an appropriated annual budget has been adopted. The general fund budget to actual report,
is presented in the required supplemental information section of this report.
Factors Affecting Financial Condition
The information presented in the financial statements is best understood when it is considered
from the broader perspective of the specific environment with which the Village of Key Biscayne
operates.
Local Economy
The Village of Key Biscayne enjoys a favorable economic environment and local indicators to
continued future stability. This exclusive community is comprised of well-educated and
involved citizens who take a genuine interest in the social, business, cultural and governing
aspects of their Village. The Village is comprised of affluent exclusive residential housing stock
and three major shopping centers. There is no industrial area in the community.
Long -Term Financial Planning
The Village has recently completed the first two phases of its Civic Center Project with the
completion of a new Village Hall / Police Building and a new Fire Station. The third phase,
presently under construction, will serve as the Village Community Center and is scheduled to
open in the fall of 2004. Recent completion of the Beach Park serves as an outlet to the beach
with a picnic shelter. Several public works projects have recently been completed yielding new
sidewalks, street improvements, park improvements, and a tree replacement program. Several
new capital projects are under way to improve the safety of the major roadway through the
Village, Crandon Boulevard.
The Village utilizes a comprehensive living projection five years into the future to assess revenue
trends and expenditure needs to assure a balanced stable financial program avoiding millage rate
increases while addressing the various goals and objectives of the community.
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Honorable Mayor, Village Council and Citizens
Village of Key Biscayne
Cash Management Policies and Practices
The Village's Cash Management strategy emphasizes immediate funds collection and deposit
into the appropriate fund utilizing ACH debit or wire transfer methods for over 90% of all funds
received. Cash is transferred to a centralized clearing account for all payments at the time of
payment. The clearing account maintains a zero balance exclusive of these transfers. Currently
the Village's investment policy follows Chapter 218, Florida Statutes. Cash in any of the find's
operating accounts are swept into an overnight repurchase agreement, properly collateralized in
accordance with Chapter 280, Florida statutes. Surplus cash is invested in certificates of deposit
held in qualified depositories, and with the State Board of Administration. Investment objectives
are the preservation of principal, liquidity in accordance with planned cash flows, and return on
investment, in that order.
Risk Management
The Village is exposed to various risks of loss related to torts, theft of or damage to and
destruction of assets; errors and omissions; injuries to employees; and natural disasters. The
Village participates in the Florida League of Cities Municipal Insurance Trust for workers'
compensation, liability and property insurance. Flood insurance is provided by the Florida State
Flood Insurance Pool.
Pension and Other Post -Employment Benefits
The Village of Key Biscayne sponsors a 401(a) defined contribution pension plan with the
International City Managers' Association Retirement Corporation (ICMA RC). Each full time
employee can contribute up to six percent (6%) of his or her pay to the plan while the Village
contributes twelve percent (12%). In addition, the Village sponsors a 457 deferred compensation
plan in which the employees may contribute on a voluntary basis.
A defined benefit plan is available to all firefighters and sworn police officers. This plan is under
the direction of a separate board of trustees, two of which are police and fire department
employees. Complete details of this plan can be found in Note 11 of the basic financial
statements.
Awards and Acknowledgements
The Government Finance Officers Association (GFOA) awarded a Certificate of Achievement
for Excellence in Financial Reporting to the Village of key Biscayne for its Comprehensive
Annual Financial Report (CAFR) for the fiscal year ended September 30, 2002. This was the
eleventh consecutive year that the Village received this prestigious award. In order to be
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Honorable Mayor, Village Council and Citizens
Village of Key Biscayne
awarded a Certificate of Achievement, the Village published an easily readable and efficiently
organized CAFR. This report satisfied both GAAP and applicable legal requirements.
The Village of Key Biscayne is presenting its first CAFR in accordance with the Governmental
Accounting Standards Board Statement Number 34, more commonly known as GASB 34, a
major new standard, which has changed the method and content governments must report. This
has been the largest single revision of governmental accounting standards and represented a
major effort on the part of the Village and their auditors to comply with this new standard.
A Certificate of Achievement is valid for a period of one year only. We believe that our current
CAFR continues to meet the Certificate of Achievement Program's requirements and are
submitting it to the GFOA to determine its eligibility for another certificate.
In addition, the Village also received the GFOA's Distinguished Budget presentation Award for
its annual budget document for the 2002-2003 fiscal year. This was the tenth consecutive year
that the Village has received this prestigious award. In order to qualify for the Distinguished
Budget Presentation Award, the Village's budget document was judged to be proficient in several
categories, including as a policy document, a financial plan, an operations guide, and a
communications device.
The preparation of this report would not have been possible without the efficient and dedicated
services of the entire staff of all departments of the Village of Key Biscayne. We would like to
express our appreciation to all members of all of the departments who assisted and contributed to
the preparation of this report. A special note of thanks and appreciation is also extended to the
firm of Rachlm Cohen Sc. Holtz LLP for their assistance in the preparation of this CAFR and for
the professional approach and high standards in conduct of their independent audit of the
Village's financial records and transactions. Appreciation is also extended to the Mayor and the
Village Council for their unfailing support for maintaining the highest standards of
professionalism in the management of the Village of Key Biscayne's finances.
Respectfully submitted,
cqueli R Menendez ✓,
Village Manager
wdk
Randolph G. White
Finance Director
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VILLAGE OF KEY BISCAYNE, FLORIDA
VILLAGE OFFICIALS
SEPTEMBER 30, 2003
VILLAGE COUNCIL
Robert Oldakowski, Mayor
Jorge Mendia, Vice Mayor
Martha Fdez-Leon Broucek
Carol Diaz Castro
Mortimer Fried
James L. Peters
Robert Vernon
VILLAGE MANAGER
Jacqueline R. Menendez
VILLAGE CLERK
Conchita H. Alvarez, CMC
VILLAGE ATTORNEY
Weiss, Serota, Helfman, Pastonza & Guedes, P.A.
FINANCE DIRECTOR
Randolph G. White, P.A.
VILLAGE AUDITORS
Rachlin Cohen & Holtz LLP
Accountants • Advisors
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Certificate of
Achievement
for Excellence
in Financial
Reporting
Presented to
Village of Key Biscayne,
Florida
For its Comprehensive Annual
Financial Report
for the Fiscal Year Ended
September 30, 2002
A Certificate of Achievement for Excellence in Financial
Reporting is presented by the Government Finance Officers
Association of the United States and Canada to
government units and public employee retirement
systems whose comprehensive annual financial
reports (CAFRs) achieve the highest
standards in government accountmg
and financial reporting.
President
/fio.,,,,
Executive Director
— vii —
VOTERS OF
KEY BISCAYNE
Village
Council
Local Planning
Agency
Village Clerk
Special Master
Village Manager
Village Attorney
Assistant
Manager
Police/Fire
Retirement
Board
Department of
Building,
Zoning and
Planning
Building
Zoning
Planning
Code Assistance
Public Safety
Department
Fire Rescue
Police
Department of
Parks and
Recreation
I
Special Events
Sports and
Athletics
Programs
and Tours
Senior
Coordinator
Department of
Public
Works
Village Engineer
Contract
Supervisor
Storm water
Management
Refuse
Collection
and Recycling
Maintenance
Department of
Finance and
Administrative
Services
Finance/
Accounting
Personnel/
Benefits
Risk
Management
FINANCIAL SECTION
REPORT OF INDEPENDENT
CERTIFIED PUBLIC ACCOUNTANTS
Cohen
cQHoltz
Accountants Advisors
REPORT OF INDEPENDENT CERTIFIED PUBLIC ACCOUNTANTS
Honorable Mayor, Village Council and Village Manager
Village of Key Biscayne, Florida
We have audited the accompanying financial statements of the governmental activities, the business -type
activities, each major fund and the aggregate remaining fund information of the Village of Key Biscayne,
Florida (the Village) as of September 30, 2003 and for the year then ended, which collectively comprise
the Village's basic financial statements as listed in the table of contents. These financial statements are
the responsibility of the Village's management. Our responsibility is to express opinions on these
financial statements based on our audit.
We conducted our audit in accordance with auditing standards generally accepted in the United States
and the standards applicable to financial audits contained m Government Auditing Standards, issued by
the Comptroller General of the United States. Those standards require that we plan and perform the audit
to obtain reasonable assurance about whether the financial statements are free of material misstatement.
An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the
financial statements. An audit also includes assessing the accounting principles used and significant
estimates made by management, as well as evaluating the overall financial statement presentation. We
believe that our audit provides a reasonable basis for our opinions.
In our opinions, the financial statements referred to above present fairly, in all material respects, the
respective financial position of the governmental activities, the business -type activities, each major fund
and the aggregate remaining fund information of the Village of Key Biscayne, Florida at September
30, 2003 and the respective changes in the financial position and cash flows, where applicable, thereof
for the year then ended, in conformity with accounting principles generally accepted in the United States.
As described in Note 1 to the basic financial statements, the Village adopted the provisions of
Governmental Accounting Standards Board Statement No. 34, Basic Financial Statements —and
Management's Discussion and Analysis —For State and Local Governments. This results in a change in
the format and content of the basic financial statements.
In accordance with Government Auditing Standards. we have also issued a report dated December 26,
2003 on our consideration of the Village's internal control over financial reporting and our tests of its
compliance with certain provisions of laws, regulations, contracts and grants. That report is an integral
part of an audit performed in accordance with Government Auditing Standards and should be read in
conjunction with this report in considering the results of our audit.
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Rachlin Cohen & Holtz ur
One Southeast Third Avenue • Tenth Floor • Miami, Florida 33131 • Phone 305 377 4228 • Fax 305 377 8331 • www.rachlin.com
An Independent Member of Baker Tilly International
MIAMI • FORT LAIIIIFROAI F ■ WFCT Pal M R F A P R . CTIIIIRT . T e M o e . u r W ICDCCV
Honorable Mayor, Village Council and Village Manager
Village of Key Biscayne, Florida
Page Two
The Management's Discussion and Analysis and the other required supplementary information on pages
3 through 10 and pages 40 through 43, respectively, are not a required part of the basic financial
statements but are supplementary information required by the Governmental Accounting Standards
Board. We have applied certain limited procedures, which consisted principally of inquiries of
management regarding the methods of measurement and presentation of the required supplementary
information. However, we did not audit the information and express no opinion on it.
Our audit was conducted for the purpose of forming opinions on the financial statements that collectively
comprise the Village of Key Biscayne's basic financial statements. The accompanying combining
financial statements listed in the table of contents are presented for purposes of additional analysis and
are not a required part of the basic financial statements of the Village. Similarly, the accompanying
schedule of expenditures of federal awards is presented for purposes of additional analysis as required by
U.S. Office of Management and Budget Circular A-133, Audits of States, Local Governments, and Non -
Profit Organizations and is not a required part of the basic financial statements. Such information has
been subjected to the auditing procedures applied in the audit of the basic financial statements and in our
opinion, is fairly stated, in all matenal respects, in relation to the basic financial statements taken as a
whole.
The information shown in the statistical section listed in the table of contents has not been subjected to
the auditing procedures applied in the audit of the basic financial statements and, accordingly, we express
no opinion thereon.
/gete.,e4;.- hty 4h,
Miami, Florida
December 26, 2003
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Cohen
&Holtz
MANAGEMENT'S DISCUSSION AND ANALYSIS
(MD&A)
Management's Discussion and Analysis
As Management of the Village of Key Biscayne, we offer readers of the Village of Key Biscayne's (the
Village) financial statements this narrative overview and analysis of the financial activities of the
Village of Key Biscayne for the fiscal year ended September 30, 2003.
Financial Highlights
• In the government -wide financial statements, the assets of the Village of Key Biscayne exceeded its
liabilities at the close of the most recent fiscal year by $31,636,099 (net assets).
• In the government -wide financial statements, the Village's total net assets decreased by $2,394,537.
This decrease is attributable to the spending of cash on various construction related projects and the
implementation of Governmental Accounting Standards Board (GASB) Statement No. 34, Basic
Financial Statements — and Management's Discussion and Analysis — for State and Local
Governments.
• At the close of the current fiscal year, the Village of Key Biscayne's governmental funds reported an
ending fund balance of $5,071,733, a decrease of $2,052,786 in comparison with the prior year.
This entire amount is either reserved or designated for spending at the Council's direction.
• The Village incurred $1,660,090 of new long-term debt during the current fiscal year.
Overview of the Financial Statements
This discussion and analysis are intended to serve as an introduction to the Village of Key Biscayne's
basic financial statements. The Village of Key Biscayne's basic financial statements comprise three
components: 1) government -wide financial statements, 2) fund financial statements, and 3) notes to the
financial statements. This report also contains other supplementary information in addition to the basic
financial statements themselves.
Government -wide financial statements. The government -wide financial statements are designed to
provide readers with a broad overview of the Village of Key Biscayne's finances, in a manner similar to
a private sector business.
The statement of net assets presents information on all of the Village of Key Biscayne's assets and
liabilities, with a difference between the two reported as net assets. Over time, increases or decreases in
net assets may serve as a useful indicator of whether the financial position of the Village of Key
Biscayne is improving or deteriorating.
The statement of activities presents information showing how the Village's net assets changed during
the most recent fiscal year. All changes in net assets are reported as soon as the underlying event giving
rise to the change occurs, regardless of the timing of related cash flows. Thus, revenues and expenses
are reported in this statement for some items that will only result in cash flows in future periods (e.g.,
uncollected taxes and earned but unused vacation leave).
Both of the government -wide financial statements distinguish functions of the Village of Key Biscayne
that are principally supported by taxes and intergovernmental revenues (governmental activities) from
other functions that are intended to recover all or a significant portion of their costs through user fees and
charges (business type activities). The governmental activities of the Village of Key Biscayne include
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general government, public safety, public works, building planning & zoning, and parks and recreation.
The government -wide financial statements include only the Village of Key Biscayne itself as the Village
does not have any component units that it is financially accountable for (known as the primary government).
The government -wide financial statements can be found on pages 11 and 12 of this report.
Fund Financial Statements. A fund is a grouping of related accounts that is used to maintain control
over resources that have been segregated for specific activities or objectives. The Village of key
Biscayne, like other state and local governments, uses fund accounting to ensure and demonstrate
compliance with finance -related legal requirements. The Village of Key Biscayne has two fund
categories, the governmental funds and the enterprise funds.
Governmental Funds. Governmental funds are used to account for essentially the same functions reported
as governmental activities in the government -wide financial statements. However, unlike the government -
wide financial statements, governmental fund financial statement focus on near -term inflows and outflows
of spend able resources as well as on balances of spendable resources available at the end of the fiscal
year. Such information may be useful in evaluating a government's near -term financing requirements.
Because the focus of governmental funds is narrower than that of the government -wide financial
statements, it is useful to compare the information presented for the governmental funds with similar
information presented for governmental activities in the government -wide financial statements. By
doing so, readers may better understand the long-term impact of the Village's near -term financing
decisions. Both the governmental fund balance sheet and the governmental fund statement of revenues,
expenditures, and changes in fund balances provide a reconciliation to facilitate this comparison
between governmental funds and governmental activities.
The Village of Key Biscayne maintains four governmental funds, the general fund, a special revenue
fund and two capital projects funds. The Village of Key Biscayne adopts an annual appropriated budget
for its general fund. A budgetary comparison statement has been provided for the general fund to
demonstrate compliance with this budget.
The basic governmental fund financial statements can be found on pages 13 to 15 of this report.
Proprietary Funds. The Village maintains one type of proprietary fund. Enterprise funds are used to
report the same functions presented as business -type activities in the government -wide financial
statements. The Village uses enterprise funds to account for its Stormwater, Solid Waste Collection and
Sanitary Sewer Construction operations.
The basic proprietary fund financial statements can be found on pages 16 to 18 of this report.
Fiduciary Funds. Fiduciary funds are used to account for resources held for the benefit of parties outside
the Village. Fiduciary funds are not reflected in the government -wide financial statements because the
resources of those funds are not available to support the Village's own programs. The accounting used for
fiduciary funds is much like that used for enterprise funds. The Village maintains one fiduciary fund to
account for the enterprise operation of its Police Officers and Firefighters Defined Benefit Pension Plan.
The basic fiduciary fund financial statements can be found on pages 19 and 20 of this report.
Notes to the basic financial statements. The notes provide additional information that is essential to a
full understanding of the data provided in the government -wide and fund financial statements. The
notes to the financial statements can be found on pages 21 to 39 of this report.
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Other Information
In addition to the basic financial statements and accompanying notes, this report also presents certain
required supplementary information concerning the Village's progress in funding its obligation to
provide pension benefits to its employees.
Required supplementary information can be found on pages 40 to 43 of this report.
Government -wide Financial Analysis
As noted earlier, net assets may serve over time as a useful indicator of a government's financial
position. In the case of the Village's, assets exceeded liabilities by $31,636,099 at the close of the most
recent fiscal year.
A portion of the Village's net assets, $25,913,756 or 82.7 %, reflects its investment in capital assets (e.g.,
land and equipment) less any related debt to acquire those assets that is still outstanding. The Village of
Key Biscayne uses these capital assets to provide services to citizens; consequently, these assets are not
available for future spending. Although the Village's investment in capital assets is reported net of related
debt, it should be noted that the resources needed to repay this debt must be provided from other sources,
since the capital assets themselves cannot be used to liquidate these liabilities.
Our analysis of the financial statements of the Village begins below. The statement of net assets and the
statement of activities report information about the Village's activities that will help answer questions
about the position of the Village. As this is the first year that the Village is presenting government -wide
statements, no comparison to the prior year is being shown. A comparative analysis will be provided
when prior year information is available.
Net Assets
A summary of the Village's net assets is presented in Table A-1 and a summary of the changes in
net assets is presented in Table A-2.
Table A-1
Summary of net assets
Governmental Business -type Total
Activities Activities 2003
Current Assets
Capital assets, net
Total assets
$ 7,086,983 $ 1,392,139 $ 8,479,122
46,299,091 8,885,441 55,184,532
53,386,074 10,277,580 63,663,654
Current liabilities 3,495,250 3,164 3,498,414
Noncurrent liabilities 21,994,322 6,843,444 28,837,766
Investment in capital assets, net of related debt 23,889,001 2,024,755 25,913,756
Restricted 171,680 171,680
Unrestricted 3,835,821 1,388,975 5,224,796
Total net assets $ 27,896,502 $ 3,413,730
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31,310,232
Table A-2
Summary of changes in net assets
Revenues:
Program Revenues:
Charges for services
Operating grants and contributions
Capital grants and contributions
General Revenues:
Property taxes
Utility taxes
Franchise taxes
Intergovernmental
Investment income and miscellaneous
Total Revenues
Expenses:
General government
Public safety
Parks and recreation
Public works
Building, zoning and planning
Debt Service
Stormwater
Solid Waste Collection
Sanitary Sewer Construction
Total Expenses
Change in net assets before transfers
Transfers
Change in net assets before transfers
Net Assets, September 30, 2002
Net Assets, September 30, 2003
Governmental Business -type
Activities Activities
Total
2003
$ 1,297,724 $ 844,656 $ 2,142,380
99,830 99,830
421,085 - 421,085
11,317,161
2,251,876
611,502
776,869
282,847
17,058,894
5,825,199
9,608,735
826,695
963,676
1,252,012
1,064,028
19,540,345
(2,481,451)
(9,737)
(2,491,188)
30,387,690
$ 27,896,502
22,163
866,819
634,361
273,076
6,288
913,725
(46,906)
9,737
(37,169)
3,450,899
$ 3,413,730
11,317,161
2,251,876
611,502
776,869
305,010
17,925,713
5,825,199
9,608,735
826,695
963,676
1,252,012
1,064,028
634,361
273,076
6,288
20,454,070
(2,528,357)
(2,528,357)
33,838,589
$ 31,310,232
The Village's net assets decreased by $2,394,537 during the current fiscal year. This decrease
represents the results of operations for a full 12 -month period with no capital contributions from outside
sources. Key elements of this decrease illustrated in the summary above.
-6-
Revenues & Expenses - Governmental Activities
$18,000,000
$16,000,000
$14,000,000
$12,000,000
$10,000,000
$8,000,000
$6,000,000
$4,000,000
$2,000,000
$0
_
r . �. .
Je; .4, ,q , JZS eS , 0
t ' '
��i ¢ ,, J-' OJ O„,b,
C.7
t�O Goo \c'~z ,
eL yro .4.1O 2�
Revenues by Source — Governmental Activities
14%
® Charges for services
■ Capital grants and -contra utions
O General Revenues:
D Property taxes
Utility taxes
■ Franchise taxes
■ Intergovernmental
O Investment income and
miscellaneous
Business -type Activities
Business -type activities decreased the Village's net assets by $37,169, accounting for 1.47 percent of the
total reduction in the Village's net assets.
• In fiscal 2003, two of the three business -type activities reflected operational profits.
• The Stormwater Utility Fund reflected an operating loss of $82,586, due mainly to depreciation
expense in the amount of $273,919.
• The Solid Waste Collection Fund reported a profit of $41,320.
• The Sanitary Sewer Construction Fund was dormant awaiting a resumption of construction activity.
-7-
Financial Analysis of the Government's Funds
As noted earlier, the Village of Key Biscayne uses fund accounting to ensure and demonstrate
compliance with finance -related legal requirements.
Governmental funds. The focus of the Village of key Biscayne's governmental funds is to provide
information on near -term inflows, outflows, and balances of spendable resources. Such information is
useful in assessing the Village's financing requirements.
At the end of the current fiscal year, fund balance of the general fund was $3,967,559, an increase of
$36,851 in comparison with the prior year. All of this is either reserved or designated for specific uses:
(1) emergencies ($2,200,000), (2) building inspection costs ($275,000), (3) compensated absences
($334,644), (4) law enforcement seizures ($462,540), (5) special disaster relief ($135,000), (6) playing
field acquisitions ($200,000), (7) additional fire position ($79,766), (8) working capital reserve
($126,058), and (9) community center equipment ($154,551).
The general fund is the chief operating fund of the Village of Key Biscayne. As a measure of the
general fund's liquidity, it may be useful to compare total fund balance to total fund expenditures. Total
fund balance represents 25.4 percent of total general fund expenditures.
A summary of the general fund's condensed balance sheet and statement of revenues, expenditures and
changes in fund balance is presented in Table B-1 and B-2 for September 30, 2003 and 2002, is shown
as follows:
Summary of condensed balance sheet
2003 2002
Total assets $ 4,789,294 $ 4,403,385
Total liabilities $ 821,735 $ 472,677
Fund balance 3,967,559 3,930,708
Total liabilities and fund balance $ 4,789,294 $ 4,403,385
Table B-2
Summary of condensed statement of revenues, expenditures, and changes in fund balance
2003 2002
Total revenues $ 16,632,613 $ 14,995,454
Total expenditures 15,647,703 14,497,752
Transfers, Net (948,059)
Net change in fund balance $ 36,851 $ 497,702
Governmental funds decreased the Village of Key Biscayne fund balance by approximately $2,052,786.
This net overall decrease was attributable to cash used to construct various components of the Village's
Civic Center capital project. All other governmental activities increased fund balance as follows:
-8-
• Property taxes increased by $1,598,478 (16.7%) during the year. Most of this increase is the
product of additional luxury condominium units completed and on the tax roll for the first time,
along with renovated homes with increased assessed values.
• Most departments increased 7 percent due to the Village's salary step program, which in fiscal
year 2003 reflected a 5 percent increase in salaries and a 2 percent increase for a cost of living
increase.
• Debt service remained fairly level compared to the prior year.
• The amount expended to the village Attorney decreased due to fewer costly lawsuits that were
reflected in the fiscal 2002 statements.
For the most part, increases in expenses closely paralleled inflation and growth in the scope of services.
General Fund Budgetary Highlights
There were no differences between the original and final budgeted amounts, as the budget did not
require any amendments. There were also no supplemental appropriations for the fiscal year ended
September 30, 2003.
Capital Assets
As of September 30, 2003, the Village's investment in capital assets for both governmental activities
and business -type activities amounted to $55,184,532 ($46,299,091 in governmental activities and
$8,885,441 in business -type activities). The total increase in capital assets for the fiscal year was as
follows:
Major capital asset events during the fiscal year for governmental activities included the following:
• Completion of the Fire Station and Village Hall / Police Department Buildings
• Completion of the Beach Park
• Numerous street improvement programs
• Completion of the Village Green Gazebo
See Note 6 on page 30 of the notes to the basic financial statements for a detailed breakdown of capital
assets by classification.
Long-term Debt
At September 30, 2003, the Village had bonded debt outstanding of $29,270,776 ($22,410,090 for
governmental activities and $6,860,686 for business -type activities). Of this amount, $6,430,000
represents bonds secured solely by specified revenue sources (stormwater revenue bonds). The
remainder are special obligation bonds that are secured by non -ad Valorem revenues through covenants
to budget and appropriate.
The Village's governmental activities debt increased by $245,090 from 2002 to 203 due to the additional
borrowing required to construct the new community center facility.
-9-
Additional information on the Village's long-term debt can be found in Note 7 on pages 31 to 35 of this
report.
Economic Factors and Next Years Budgets and Rates
• The unemployment rate for Miami -Dade County is currently 7.3 percent, which is a decrease from
a rate of 7.4 percent a year ago. This compares unfavorably to the state's average unemployment
rate of 5.1 percent and the national average rate of 6.1 percent. The Village's average rate
remained unchanged at 3.2 percent.
• The occupancy rate of the Village's retail rentals and hospitality service industry has remained
stable for the past several years.
• Inflationary trends in the region compare favorably to national indices.
All of these factors were considered in preparing the Village of Key Biscayne's budget for the 2004
fiscal year.
Requests for Information
This financial report is designed to provide a general overview of the Village of Key Biscayne's
finances for all those with an interest in the Village's finances. Questions concerning any of the
information provided in this report or requests for additional financial information should be addressed
to the Office of the Village Manager, 88 West McIntyre Street, Key Biscayne, Florida 33149.
-10-
BASIC FINANCIAL STATEMENTS
VILLAGE OF KEY BISCAYNE, FLORIDA
STATEMENT OF NET ASSETS
SEPTEMBER 30, 2003
ASSETS
Cash and cash equivalents
Investments
Property taxes receivable
Other receivables
Interest receivable
Internal balances
Net pension asset
Capital assets not being depreciated
Capital assets, net of accumulated depreciation
Total assets
LIABILITIES
Accounts payable and accrued liabilities
Retainage payable
Deferred revenue
Noncurrent liabilities:
Due within one year
Due in more than one year
Total liabilities
NET ASSETS
Invested in capital assets, net of related debt
Restricted for law enforcement
Unrestricted
Total net assets
Governmental
Activities
$ 5,977,025
181,094
41,570
868,115
19,179
325,867
23,919,097
22,379,994
53,711,941
1,478,235
502,162
13,134
1,501,719
21,994,322
25,489,572
23,889,001
171,680
4,161,688
Business -
type
Activities
$ 154,574
1,023,927
221,757
11,060
(19,179)
463,915
8,421,526
10,277,580
3,164
17,242
6,843,444
6,863,850
Total
$ 6,131,599
1,205,021
41,570
1,089,872
11,060
325,867
24,383,012
30,801,520
63,989,521
1,481,399
502,162
13,134
1,518,961
28,837,766
32,353,422
2,024,755 25,913,756
171,680
1,388,975 5,550,663
$ 28,222,369 $3,413,730 $31,636,099
See notes to basic financial statements.
11
STATEMENT OF ACTIVITIES
FISCAL YEAR ENDED SEPTEMBER 30, 2003
Functions/Programs
Governmental activities:
General government
Public works
Police
Fire
Parks and recreation
Building, zoning and planning
Interest on long-term debt
Total governmental activities
Business -type activities:
Stormwater
Solid waste
Sanitary sewer
Total business -type activities
Total
Expenses
$ 5,691,379
963,676
4,787,090
4,821,645
826,695
1,252,012
1,064,028
19,406,525
Charges
for
Services
Program Revenues
Operating Capital
Grants and Grants and
Contributions Contributions
$1,034,247 $ 83,830 $ -
421,085
110,215 16,000
5,805
29,752
117,705
1,297,724
634,361 531,164
273,076 313,492
6,288
913,725 844,656
$20,320,250 $2,142,380 $ 99,830 $ 421,085
99,830 421,085
General revenues:
Property taxes
Franchise fees based on gross receipts
Utility taxes
Intergovernmental
Unrestricted investment earnings
Miscellaneous
Transfers
Total general revenues
Change in net assets
Net assets - beginning
Net assets - ending
See notes to basic financial statements.
-12-
Net (Expense)
Changes in
Governmental
Activities
Revenue and
Net Assets
Business -
type
Activities
$ (4,573,302) $
(542,591)
(4,660,875)
(4,815,840)
(796,943)
(1,134,307)
(1,064,028)
(17,587,886)
(17,587,886)
11,317,161
611,502
2,251,876
776,869
82,286
200,561
(9,737)
15,230,518
(2,357,368)
30,579,737
$ 28,222,369
(103,197)
40,416
(6,288)
(69,069)
(69,069)
22,163
9,737
31,900
(37,169)
3,450,899
$ 3,413,730
Total
$ (4,573,302)
(542,591)
(4,660,875)
(4,815,840)
(796,943)
(1,134,307)
(1,064,028)
(17,587,886)
(103,197)
40,416
(6,288)
(69,069)
(17,656,955)
11,317,161
611,502
2,251,876
776,869
104,449
200,561
15,262,418
(2,394,537)
34,030,636
$ 31,636,099
VILLAGE OF KEY BISCAYNE, FLORIDA
BALANCE SHEET
GOVERNMENTAL FUNDS
SEPTEMBER 30, 2003
ASSETS
Cash and cash equivalents
Investments
Property taxes receivable
Other receivables, net
Due from other funds
Total assets
LIABILITIES AND
FUND BALANCES
Liabilities:
Accounts payable and
accrued liabilities
Retamage payable
Due to other funds
Deferred revenue
Compensated absences
Total liabilities
Fund balances:
Reserved
Unreserved reported in:
Civic center fund
General fund - designated
Total fund balances
Total liabilities and
fund balances
Special
Revenue
Capital Civic (a nonmajor
General Improvements Center fund)
$ 4,075,414
181,094
41,570
467,221
23,995
$ 4,789,294
$ 1,803,495 $ 15,195 $
306,876
875,781
82,921
94,018
21,624
2,110,371 $ 890,976 $ 198,563
$ 765,258 $ 31,316 $ 681,662 $
- 502,161
880,597
21,624
13,134
21,719
821,735 911,913 1,183,823
Total
Governmental
Funds
$ 5,977,025
181,094
41,570
868,115
921,400
$ 7,989,204
- $ 1,478,236
502,161
902,221
13,134
21,719
2,967,382 1,198,458 - 198,563
1,000,177
- (292,847)
3,967,559 1,198,458 (292,847) 198,563
$ 4,789,294 $ 2,110,371 $ 890,976 $ 198,563
Amounts reported for governmental activities in the statement of net assets are different because:
Capital assets used in governmental activities are not financial resources and, therefore,
are not reported in the funds.
A negative (NPO) net pension obligation is not considered to represent a financial
asset and therefore is not reported in the governmental funds
Long-term liabilities, including bonds payable, are not due and payable in the current
period and therefore not reported in the funds
Net assets of governmental activities
2,917,471
4,364,403
(292,847)
1,000,177
5,071,733
46,299,091
325,867
(23,474,322)
$ 28,222,369
See notes to basic financial statements
1
VILLAGE OF KEY BISCAYNE, FLORIDA
STATEMENT OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCES
GOVERNMENTAL FUNDS
FISCAL YEAR ENDED SEPTEMBER 30, 2003
Revenues:
Property taxes
Utility taxes
Franchise fees
Licenses and permits
Intergovernmental
Charges for services
Interest
Grants
Other
Total revenues
Expenditures:
Current:
General government
Fire Rescue
Police
Public works
Building, zoning and planning
Parks and recreation
Capital outlay
Debt service:
Principal
Interest and fiscal charges
Total expenditures
Excess (deficiency) of revenues
over expenditures
Other financing sources (uses):
Transfers in
Transfers out
Bonds issued
Total other financing
sources (uses)
Net change in fund balances
Fund balances - beginning
Fund balances - ending
General
$11,317,161
2,251,876
611,502
970,001
999,391
327,723
55,129
99,830
16,632,613
1,829,501
4,046,269
4,305,474
963,247
1,245,119
782,065
1,415,000
1,061,028
15,647,703
984,910
330
(948,389)
Special
Revenue Total
Capital Civic (a nonmajor Governmental
Improvements Center fund) Funds
$ - $ $ $ 11,317,161
2,251,876
611,502
970,001
999,391
327,723
12,031 15,126 - 82,286
99,830
200,000 561 198,563 399,124
212,031 15,687 198,563 17,058,894
461,303 4,647,027
3,000
461,303 4,650,027
1,829,501
4,046,269
4,305,474
963,247
1,245,119
782,065
5,108,330
1,415,000
1,064,028
20,759,033
(249,272) (4,634,340) 198,563 (3,700,139)
938,322
1,657,090
938,652
(948,389)
1,657,090
(948,059) 938,322 1,657,090 1,647,353
36,851 689,050 (2,977,250) 198,563
3,930,708 509,408 2,684,403
$ 3,967,559 $ 1,198,458 $ (292,847) $ 198,563 $ 5,071,733
(2,052,786)
7,124,519
See notes to basic financial statements.
VILLAGE OF KEY BISCAYNE, FLORIDA
RECONCILIATION OF THE STATEMENT OF REVENUES, EXPENDITURES AND CHANGES IN
FUND BALANCES OF GOVERNMENTAL FUNDS TO THE STATEMENT OF ACTIVITIES
FISCAL YEAR ENDED SEPTEMBER 30, 2003
Amounts reported for governmental activities in the statement of activities
(Page 8) are different because.
Net change in fund balances - total governmental funds (Page 14) $ (2,052,786)
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
Depreciation expense
Net adjustment
The issuance of long-term debt 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 detail of the differences are as follows.
Debt payments
2002 revenue bonds issued
Net adjustment
Some expenses reported in the statement of activities do not require current
financial resources and, therefore, are not reported as expenditures in
governmental funds.
$ 1,650,867
(779,947)
1,415,000
$ (1,660,090)
870,920
(245,090)
The details of the difference is•
Compensated absences (1,064,232)
Change in net assets of governmental activities (Page 12) $ (2,491,188)
See notes to basic financial statements
c
VILLAGE OF KEY BISCAYNE, FLORIDA
STATEMENT OF NET ASSETS
PROPRIETARY FUNDS
SEPTEMBER 30, 2003
Business -type Activities -
Enterprise Funds
Stormwater
Utility Nonmaj or
System Funds Totals
ASSETS
Current assets:
Cash and cash equivalents $ 81,116 $ 73,458 $ 154,574
Investments 1,023,927 - 1,023,927
Receivables, net 101,109 120,648 221,757
Interest receivable 11,060 - 11,060
Total current assets 1,217,212 194,106 1,411,318
Noncurrent assets:
Capital assets not being depreciated
Capital assets, net of accumulated depreciation
Total noncurrent assets
Total assets
LIABILITIES
Current liabilities:
Accounts payable and accrued liabilities
Due to other funds
Current portion of revenue bonds payable
Total current liabilities
Noncurrent liabilities:
Revenue bonds
Revolving loan
Total noncurrent liabilities
Total liabilities
- 463,915 463,915
8,421,526 - 8,421,526
8,421,526 463,915 8,885,441
9,638,738 658,021 10,296,759
3,164
19,179
22,343
3,164
- 19,179
17,242 17,242
17,242 39,585
6,430,000 6,430,000
413,444 413,444
6,430,000 413,444 6,843,444
6,452,343 430,686 6,883,029
NET ASSETS
Invested in capital assets, net of related debt 1,991,526 33,229 2,024,755
Unrestricted 1,194, 869 194,106 1,3 88,975
Total net assets $3,186,395 $ 227,335 $3,413,730
See notes to basic financial statements.
1l
VILLAGE OF KEY BISCAYNE, FLORIDA
STATEMENT OF REVENUES, EXPENSES AND CHANGES IN NET ASSETS
PROPRIETARY FUNDS
FISCAL YEAR ENDED SEPTEMBER 30, 2003
Business -type Activities -
Enterprise Funds
Stoll iwater
Utility Nonmajor
System Funds Totals
Operating revenues:
Charges for services $ 531,164 $ 313,492 $ 844,656
Operating expenses:
General and administrative 86,828 273,076 359,904
Depreciation 273,920 - 273,920
Total operating expenses 360,748 273,076 633,824
Operating income 170,416 40,416 210,832
Non -operating revenues (expenses):
Interest income 20,612 1,551 22,163
Interest expense (273,613) (6,288) (279,901)
Total non -operating revenues (expenses) (253,001) (4,737) (257,738)
Income (loss) before transfers (82,585) 35,679 (46,906)
Transfers in 10,067 10,067
Transfers out - (330) (330)
Net income (82,585) 45,416 (37,169)
Net assets, beginning 3,268,980 181,919 3,450,899
Net assets, ending $ 3,186,395 $ 227,335 $ 3,413,730
See notes to basic financial statements.
1 7
VILLAGE OF KEY BISCAYNE, FLORIDA
STATEMENT OF CASH FLOWS
PROPRIETARY FUNDS
FISCAL YEAR ENDED SEPTEMBER 30, 2003
Business -type Activities -
Enterprise Funds
Stormwater
Utility Nonmajor
System Funds Totals
Cash flows from operating activities:
Receipts from customers and users
Payments to suppliers
Net cash provided (used) by operating activities
Cash flows from non -capital financing activities:
Transfers from other funds
Transfers to other funds
Net cash provided by non -capital financing activities
Cash flows from capital and related financmg activities:
Net payments from revolving loan
Principal paid on capital debt
Interest paid on capital debt
Net cash used by capital and related financing activities
Cash flows from investing activities:
Purchase of investments
Interest received
Net cash provided by investing activities
Net increase (decrease) in cash and cash equivalents
Cash and cash equivalents, beginning
Cash and cash equivalents, ending
Reconciliation of operating income to net cash
provided by operating activities:
Operating income
Adjustments to reconcile operating income to net cash
provided (used) by operating activities:
Depreciation
Changes in operating assets and liabilities:
(Increase) decrease in:
Accounts receivable
Interest receivable
Increase (decrease) in:
Accounts payable
Due to other funds
Total adjustments
Net cash provided (used) by operating activities
$ 632,864 $ 261,528 $ 894,392
(86,828) (273,076) (359,904)
546,036 (11,548) 534,488
10,067 10,067
- (330) (330)
9,737 9,737
- (339,780) (339,780)
(195,000) - (195,000)
(273,613) (6,288) (279,901)
(468,613) (346,068) (814,681)
(16,941) - (16,941)
20,611 1,551 22,162
3,670 1,551 5,221
81,093 (346,328) (265,235)
23 419,786 419,809
$ 81,116 $ 73,458 $ 154,574
$ 170,416 $ 40,416 $ 210,832
273,920 273,920
126,035 (72,276) 53,759
(1,948) - (1,948)
3,164 - 3,164
(25,551) 20,312 (5,239)
375,620 (51,964) 323,656
$ 546,036 $ (11,548) $ 534,488
See notes to basic financial statements.
1R
VILLAGE OF KEY BISCAYNE, FLORIDA
STATEMENT OF FIDUCIARY NET ASSETS
PENSION TRUST FUND
SEPTEMBER 30, 2003
ASSETS
Mutual fund investments
Other assets
Total assets
Liabilities
LIABILITIES
NET ASSETS
$ 3,015,954
283,802
3,299,756
Held in trust for pension benefits $ 3,299,756
See notes to basic financial statements
-10-
VILLAGE OF KEY BISCAYNE, FLORIDA
STATEMENT OF CHANGES IN FIDUCIARY NET ASSETS
PENSION TRUST FUND
FISCAL YEAR ENDED SEPTEMBER 30, 2003
ADDITIONS
Contributions:
Plan members $ 830,411
State 199,273
Total contributions 1,029,684
Investment earnings:
Interest and dividends
Net increase in the fair value of investments
Total investments earnings
Total additions
DEDUCTIONS
Distributions
Administrative expenses
Total deductions
Change in net assets
Net assets beginning
Net assets - ending
6,909
307,939
314,848
1,344,532
109,418
43,160
152,578
1,191,954
2,107,802
$ 3,299,756
See notes to basic financial statements.
NOTES TO BASIC FINANCIAL STATEMENTS
VILLAGE OF KEY BISCAYNE, FLORIDA
NOTES TO BASIC FINANCIAL STATEMENTS
FISCAL YEAR ENDED SEPTEMBER 30, 2003
NOTE 1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
The Village of Key Biscayne, Florida (the Village), located in Miami -Dade County, is a political
subdivision of the State of Florida. The Village, which was incorporated in 1991, operates under
a Council -Manager form of government. In addition to the general government function, the
Village provides its residents with public works, public safety (police and fire), parks and
recreation, building, zoning and planning functions, sanitation and stormwater management. The
Village does not provide educational or hospital facilities; those services are provided by the
Miami -Dade County School Board and Miami -Dade County, respectively.
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. For the fiscal year ended
September 30, 2003, the Village adopted the new accounting and financial reporting requirements
of GASB Statement No 34, Basic Financial Statements — and Management's Discussion and
Analysis — for State and Local Governments; Statement No. 37, Basic Financial Statements — and
Management's Discussion and Analysis — for State and Local Governments; Omnibus, an
amendment of GASB Statements No. 21 and 34; Statement No. 38, Certain Financial Statement
Note Disclosures; and Interpretation No 6, Recognition and Measurement of Certain Liabilities
and Expenditures in Governmental Fund Financial Statements. Statement No. 34 (as amended by
Statement No. 37) represents a very significant change in the financial reporting model used by
state and local governments. As a result, an entirely new financial presentation format has been
provided. The more significant of the Village's accounting policies are described below:
A. Financial Reporting Entity
The financial statements were prepared in accordance with GASB Statement No. 14, The
Financial Reporting Entity, which establishes standards for defining and reporting on the
financial reporting entity. The definition of the financial reporting entity is based upon the
concept that elected officials are accountable to their constituents for their actions. One of
the objectives of financial reporting is to provide users of financial statements with a basis for
assessing the accountability of the elected officials. The financial reporting entity consists of
the Village, organizations for which the Village is financially accountable, and other
organizations for which the nature and significance of their relationship with the Village are
such that exclusion would cause the reporting entity's financial statements to be misleading or
incomplete. The Village is financially accountable for a component unit if it appoints a
voting majority of the organization's governing board and it is able to impose its will on that
organization or there is a potential for the organization to provide specific financial benefits
to, or impose specific financial burdens on, the Village. Based upon the application of these
criteria, there were no organizations that met the criteria described above.
B. Government -Wide and Fund Financial Statements
The government -wide financial statements (i.e., the statement of net assets and the statement
of activities) report information on all of the non -fiduciary activities of the Village. For the
most part, the effect of interfund activity has been removed from these statements
-21-
VILLAGE OF KEY BISCAYNE, FLORIDA
NOTES TO BASIC FINANCIAL STATEMENTS
(Continued)
NOTE 1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued)
B. Government -Wide and Fund Financial Statements (Continued)
Governmental activities, which normally are supported by taxes and intergovernmental
revenues, are reported separately from business -type activities, which rely to a significant
extent on fees and charges for support.
The statement of activities demonstrates the degree to which the direct expenses of a given
function or segment are offset by program revenues. Direct expenses are those that are
clearly identifiable with a specific function or segment. Program revenues include 1) charges
to customers or applicants who purchase, use, or directly benefit from goods, services, or
privileges provided by a given function or segment and 2) grants and contributions that are
restricted to meeting the operational or capital requirements of a particular function or
segment. Taxes and other items not properly included among program revenues are reported
instead as general revenues.
Separate financial statements are provided for governmental funds, propnetary 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. All remaining nonmajor
governmental funds are aggregated and reported as other governmental funds. The Village
has only one nonmajor governmental fund (the Special Revenue Fund).
C. 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. Revenues are recorded when earned and expenses are
recorded when a liability is incurred, regardless of the timmg of related cash flows. Property
taxes are recognized as revenues in the year for which they are levied. Grants and similar
items are recognized as revenue as soon as all eligibility requirements imposed by the
provider have been met.
Governmental fund financial statements are reported using the current financial resources
measurement focus and the modified accrual basis of accounting. Revenues are recognized
as soon as they are both measurable and available. Revenues are considered to be available
when they are collectible within the current period or soon enough thereafter to pay liabilities
of the current period. For this purpose, the Village considers revenues to be available if they
are collected within 60 days of the end of the current fiscal period. Expenditures are recorded
when a liability is incurred, as under accrual accounting. However, debt service expenditures,
as well as expenditures related to compensated absences and claims and judgments, are
recorded only when payment is due.
Property taxes, franchise fees and other taxes, licenses, and interest associated with the
current fiscal period are all considered to be susceptible to accrual and so have been
recognized as revenues of the current fiscal period. All other revenue items are considered to
be measurable and available only when cash is received by the Village.
-22-
VILLAGE OF KEY BISCAYNE, FLORIDA
NOTES TO BASIC FINANCIAL STATEMENTS
(Continued)
NOTE 1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued)
C. Measurement Focus, Basis of Accounting, and Financial Statement Presentation
(Continued)
The Village reports the following major governmental funds:
The General Fund is the Village's primary operating fund. It accounts for all financial
resources of the general government, except those required to be accounted for in another
fund.
The Capital Improvement Fund accounts for the acquisition or construction of various
major capital projects.
The Civic Center Fund accounts for the construction of the Village's civic center which
includes administrative offices, fire and police facilities and a community center.
The Village also reports the following nonmajor government fund:
The Special Revenue Fund accounts for the revenues received from the transportation
surtax and expenditures for related transportation costs.
The Village reports the following major proprietary fund in the basic financial statements:
The Stormwater Utility Fund accounts for the construction and maintenance of the
Village's stormwater system.
Additionally, the Village reports the following fund types:
The Pension Trust Fund is used to account for the Village's single -employer defined
benefit pension plan covering substantially all of its police officers and firefighters.
Private -sector standards of accounting and financial reporting issued prior to December 1,
1989, generally are followed in both the government -wide and proprietary fund financial
statements to the extent that those standards do not conflict with or contradict guidance of the
Governmental Accounting Standards Board. The Village has the option of following
subsequent private -sector guidance for their business -type activities and enterprise funds,
subject to this same limitation. The Village has elected not to follow subsequent private -
sector guidance.
As a general rule, the effect of interfund activity has been eliminated from the government -
wide financial statements. Exceptions to this general rule are payments -in -lieu of taxes and
other charges between the Village's various utility functions 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.
-23-
VILLAGE OF KEY BISCAYNE, FLORIDA
NOTES TO BASIC FINANCIAL STATEMENTS
(Continued)
NOTE 1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued)
C. Measurement Focus, Basis of Accounting, and Financial Statement Presentation
(Continued)
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. 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 stormwater utility, solid waste services and
sanitary sewer construction funds are charges to customers for services. Operating expenses
for enterprise funds include the costs of services, administrative expenses, and depreciation
on capital assets. All revenues and expenses not meeting this definition are reported as
nonoperating revenues and expenses.
D. Assets, Liabilities, and Net Assets or Equity
1. Deposits and Investments
The Village's cash and cash equivalents include cash on hand, time and demand deposits,
and short-term investments with original maturities of three months or less from the date
of acquisition and investments with the State Board Investment Pool.
Short-term investments, except the State Board Investment Pool, are reported at cost,
which approximates fair value. The Investment Pool is recorded at its value of the pool
shares (2A-7 Pool) which is fair value.
The nature of investments is governed by the provisions of Florida Statutes Section 218.
Under this statute, authorized investments are limited, unless otherwise authorized by law
or ordinance, to the local government surplus funds trust fund, money market funds, direct
or unconditionally guaranteed obligations of the United States Government, obligations of
certain governmental agencies, interest bearing time deposits or savings accounts.
2. Receivables and Payables
Activity between funds that are representative of lending/borrowing arrangements
outstanding at the end of the fiscal year are referred to as "due to/from other funds". Any
residual balances outstanding between the governmental activities and business -type
activities are reported in the government -wide financial statements as "internal balances."
-24-
VILLAGE OF KEY BISCAYNE, FLORIDA
NOTES TO BASIC FINANCIAL STATEMENTS
(Continued)
NOTE 1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued)
D. Assets, Liabilities, and Net Assets or Equity (Continued)
3. Capital assets
Capital assets, which include property, plant and equipment, and certain infrastructure
assets (e.g., utility plant, roads, bridges, sidewalks, and similar items), are reported in the
applicable governmental or business -type activities columns in the government -wide
financial statements. Capital assets are defined by the Village as assets with an initial,
individual cost of more than $750 and an estimated useful life in excess of one year. Such
assets are recorded at historical cost or estimated historical cost if purchased or
constructed. Donated capital assets are recorded at estimated fair market 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. Interest incurred during the construction phase of capital assets of business -
type activities is included as part of the capitalized value of the asset constructed. No such
costs were capitalized in 2003.
Capital assets of the Village are depreciated using the straight line method over the
following estimated useful lives:
Assets Years
Buildings 25-50
Improvements other than buildings 10-50
Equipment 10
Furniture and fixtures 10
4. Compensated absences
It is the Village's policy to permit employees to accumulate within certain limits, earned
but unused vacation time and sick leave, which will be paid to employees upon separation
from Village service. All vacation and sick leave pay is accrued when incurred in the
government -wide, and proprietary fund financial statements. In the governmental funds, a
liability is recorded only for vacation and sick leave payouts for employee separations
occurring within 60 days subsequent to the year-end.
-25-
VILLAGE OF KEY BISCAYNE, FLORIDA
NOTES TO BASIC FINANCIAL STATEMENTS
(Continued)
NOTE 1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued)
D. Assets, Liabilities, and Net Assets or Equity (Continued)
5. Long-term obligations
In the government -wide financial statements, and proprietary fund types in the fund
financial statements, long-term debt and other long-term obligations are reported as
liabilities in the applicable governmental activities, business -type activities, or proprietary
fund type statement of net assets. Bond premiums and discounts, as well as issuance costs,
are deferred and amortized over the life of the bonds using the straight-line amortization
method. The results of using this method do not differ significantly from the effective
interest method. Bonds payable are reported net of the applicable bond premium or
discount.
In the fund financial statements, governmental fund types recognize bond premiums and
discounts, as well as bond issuance costs, during the current period. The face amount of
debt issued is reported as other financing sources. Premiums received on debt issuances
are reported as other financing sources while discounts on debt issuances are reported as
other financing uses. Issuance costs, whether or not withheld from the actual debt
proceeds received, are reported as debt service expenditures.
6. Use of Estimates
The preparation of financial statements in conformity with accounting principles generally
accepted in the United States requires management to make estimates and assumptions that
affect the amounts of assets, liabilities, disclosures of contingent liabilities, revenues and
expenditures/expenses reported in the financial statements and accompanying notes.
These estimates include assessing the collectibility of receivables, the realization of
pension obligations and the useful lives of capital assets. Although these estimates as well
as all estimates are based on management's knowledge of current events and actions it
inay undertake in the future, they may ultimately differ from actual results.
7. Fund Equity
In the fund financial statements, governmental funds report reservations of fund balance
for amounts that are not available for appropriation or are legally restricted by outside
parties for use for a specific purpose. Designations of fund balance, where noted,
represent tentative management plans that are subject to change.
-26-
VILLAGE OF KEY BISCAYNE, FLORIDA
NOTES TO BASIC FINANCIAL STATEMENTS
(Continued)
NOTE 2. 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 insured or
collateralized with securities held by the entity or its agent in the entity's name.
Investments
The Village is authorized to invest in obligations of the U.S. Treasury, its agencies,
instrumentalities and the Local Government Surplus Funds Trust Fund administered by the
State Board of Administration. The investments follow the investment rules defined in
Florida Statutes Chapter 215 The investment policy defined in the statutes attempts to
promote, through state assistance, the maximization of net interest earnings on invested
surplus funds of local units of governments while limiting the risk to which the funds are
exposed.
The Local Government Surplus Funds Trust Fund is governed by Ch. 19-7 of the Florida
Administrative Code, which identifies the Rules of the State Board of Administration. These
rules provide guidance and establish the general operating procedures for the administration
of the Local Government Surplus Funds Trust Fund. Additionally, the Office of the Auditor
General performs the operational audit of the activities and investments of the State Board of
Administration. The Local Government Surplus Funds Trust Fund is not a registrant with the
Securities sand Exchange Commission (SEC); however, the Board has adopted operating
procedures consistent with the requirements for a 2a-7 fund.
The Village's investment balances, which are earned at fair value, are classified as credit risk
category 1; insured or registered, or securities held by the entity or its agent in the entity's
name, were as follows:
Category 1
Repurchase agreements
Investments not subject to categorization.
Mutual funds
State Board of Administration investment pool
$ 2,724,484
3,015,954
173,608
$ 5,914,046
-27-
VILLAGE OF KEY BISCAYNE, FLORIDA
NOTES TO BASIC FINANCIAL STATEMENTS
(Continued)
NOTE 2. DEPOSITS AND INVESTMENTS (Continued)
Investments (Continued)
A reconciliation of cash and investments as shown on the statement of net assets is as follows:
Deposits (including cash and certificates of deposit)
Investments
Total deposits and investments
Cash and cash equivalents, primary government
Investments, primary government
Total, primary government
Investments, fiduciary funds
Grand total
NOTE 3. RECEIVABLES
$ 4,438,528
5,914,046
$10,352,574
$ 6,131,599
1,205,021
7,336,620
3,015,954
$10,352,574
Receivables as of September 30, 2003 for the Village's individual major funds, nonmajor funds,
internal service funds and fiduciary funds m the aggregate, including the allowances for
uncollectible accounts, are as follows:
Capital Storm -
General Improvements water
Nonmaj or
and Other
Funds Total
Customers billed $ - $ 101,109 140,535 $ 241,644
Property taxes 41,570 - 41,570
Intergovernmental 467,221 306,876 94,018 868,115
Gross receivables 508,791 306,876 101,109 234,553 1,151,329
Less allowance for
uncollectibles 19,887 19,887
Net total receivables $ 508,791 $ 306,876 $ 101,109 $ 214,666 $ 1,131,442
-2R-
VILLAGE OF KEY BISCAYNE, FLORIDA
NOTES TO BASIC FINANCIAL STATEMENTS
(Continued)
NOTE 4. PROPERTY TAXES
Property values are assessed on a county -wide basis by the Miami -Dade County Property
Appraiser as of January 1, the lien date, of each year and are due the following November 1.
Taxable value of property within the Village is certified by the Property Appraiser and the
Village levies a tax millage rate upon the taxable value, which will provide revenue required for
the fiscal year beginning October 1
Property taxes levied each November 1, by the Village and all other taxing authorities within the
County, are centrally billed and collected by Miami -Dade County, with remittances to the
Village of their proportionate share of collected taxes. Taxes for the fiscal year beginning
October 1 are billed in the month of November, subject to a 1% per month discount for the
period November through February, and are due no later than March 31. On April 1, unpaid
amounts become delinquent with interest and penalties added thereafter. Beginning June 1, tax
certificates representing delinquent taxes with interest and penalties are sold by Miami -Dade
County, with remittance to the Village for its share of those receipts. At September 30, 2003,
there were no material delinquent taxes.
NOTE 5. INTERFUND RECEIVABLES, PAYABLES, AND TRANSFERS
The composition of interfund balances as of September 30, 2002 is as follows:
Receivable Fund Payable Fund Amount
Due from/to other funds:
General $ 19,179
4,816
Civic Center 875,781
Nonmajor governmental 21,624
Interfund transfers•
Transfers out.
General fund
Nonmajor funds
Total transfers out
Storm water utility
Capital Improvement
Capital Improvement
General Fund
$ 921,400
Transfers In
General Capital
Fund Improvement Nonmaior Total
$ - $ 938,322 $ 10,067 $ 948,389
330
330
$ 330 $ 938,322 $ 10,067 $ 948,719
-29-
VILLAGE OF KEY BISCAYNE, FLORIDA
NOTES TO BASIC FINANCIAL STATEMENTS
(Continued)
NOTE 6. CAPITAL ASSETS
Capital asset activity for the year ended September 30, 2003 was as follows:
Governmental activities:
Capital assets, not being depreciated:
Land
Construction in progress
Total capital assets, not being depreciated
Capital assets, being depreciated:
Buildings
Improvements other than buildings
Furniture, fixtures and equipment
Total capital assets, being depreciated
Less accumulated depreciation for:
Buildings
Improvements
Furniture, fixtures and equipment
Total accumulated depreciation
Total capital assets, being depreciated, net
Governmental activities capital assets, net
Business -type activities:
Capital assets, not being depreciated:
Construction in progress
Total capital assets, not being depreciated
Capital assets, being depreciated:
Storinwater utility system
Total capital assets, being depreciated
Less accumulated depreciation for:
Stormwater utility system
Total accumulated depreciation
Total capital assets, being depreciated, net
Business -type activities capital assets, net
Beginning
Balance
Ending
Increases Decreases Balance
$21,833,837 $ - $ - $21,833,837
12,266,787 2,085,260 12,266,787 2,085,260
34,100,624 2,085,260 12,266,787 23,919,097
814,668 12,266,787 627,500 12,453,955
10,994,376 - 10,994,376
2,788,522 1,165,009 971,902 2,981,629
14,597,566 13,431,796 1,599,402 26,429,960
29,946 224,058
1,972,186 227,074
1,267,887 328,815
3,270,019 779,947
- 254,004
- 2,199,260
- 1,596,702
- 4,049,966
11,327,547 12,651,849 1,599,402 22,379,994
$ 45,428,171 $14,737,109 $13,866,189 $ 46,299,091
$ 373,249 $ 90,666 $
373,249 90,666
10,056,660
10,056,660
$ 463,915
463,915
- 10,056,660
- 10,056,660
1,361,214 273,920
1,361,214 273,920
8,695,446 (273,920)
$ 9,068,695 $ (183,254) $
1,635,134
1,635,134
8,421,526
$ 8,885,441
-30-
VILLAGE OF KEY BISCAYNE, FLORIDA
NOTES TO BASIC FINANCIAL STATEMENTS
(Continued)
NOTE 6. CAPITAL ASSETS (Continued)
Depreciation expense was charged as functions/programs of the primary government as follows:
Governmental activities:
General government $ 296,927
Police 176,888
Fire 254,180
Public works 429
Building, zoning and planning 6,893
Parks 44,630
Total depreciation expenses - governmental activities $ 779,947
Business -type activities:
Stormwater
Sanitary sewer
NOTE 7. LONG-TERM DEBT
$ 273,920
$ 273,920
The following is a summary of changes in long-term liabilities of the Village for governmental
activities for the year ended September 30, 2003
Beginning Ending Due Within
Balance Additions Reductions Balance One Year
Governmental Activities
Bonds payable
Land acquisition revenue bonds, Series 1993 $ 2,165,000 $ - $ 1,060,000 $ 1,105,000 $ 1,105,000
Land acquisition and capital improvement
revenue bonds, Senes 1999 10,000,000 - 355,000 9,645,000 375,000
Land acquisition and capital improvement
revenue bonds, Series 2000 10,000,000 - - 10,000,000 -
Capital improvement bonds, Series 2002 - 1,660,090 - 1,660,090
Total bonds payable 22,165,000 1,660,090 1,415,000 22,410,090 1,480,000
Other liabilities
Compensated absences 1,312,108 - 226,157 1,085,951 21,719
Total other liabilities 1,312,108 - 226,157 1,085,951 21,719
Governmental activities long-term liabilities $23,477,108 $1,660,090 $ 1,641,157 $23,496,041 $ 1,501,719
-31-
VILLAGE OF KEY BISCAYNE, FLORIDA
NOTES TO BASIC FINANCIAL STATEMENTS
(Continued)
NOTE 7. LONG-TERM DEBT (Continued)
Revenue Bonds
Land Acquisition Revenue Bonds
On December 14, 1993, the Village issued $9,200,000 Land Acquisition Revenue Bonds,
Series 1993, the proceeds of which were used for the acquisition of the Village Green
property. The bonds matured on December 15, 2003. The Village has pledged public
service tax revenues to secure payment of the principal and interest on the bonds. The
bonds are due in annual principal installments. Interest accrues at 4.36% per annum.
Debt service requirements to maturity are as follows:
Principal Interest Total
Fiscal year ending September 30:
2004 $1,105,000 $ 24,089 $1,129,089
Land Acquisition and Capital Improvement Revenue Bonds
On July 23, 1999, the Village issued $10,000,000 Land Acquisition and Capital
Improvement Revenue Bonds, Series 1999, the proceeds of which were used for the
acquisition of property and financing of the construction of the Civic Center project. The
bonds mature on July 23, 2019. The Village has pledged non -ad valorem revenues to
secure payment of the principal and interest on the bonds. The bonds are due in annual
principal installments ranging from $355,000 in fiscal year 2004 to $815,000 in fiscal year
2020. Interest accrues at 4.715% per annum.
Debt service requirements to maturity are as follows:
Principal Interest Total
Fiscal year ending September 30:
2004 $ 375,000 $ 445,921 $ 820,921
2005 390,000 427,886 817,886
2006 410,000 409,026 819,026
2007 430,000 389,223 819,223
2008 455,000 368,359 823,359
2009-2013 2,630,000 1,490,412 4,120,412
2014-2018 3,365,000 786,816 4,151,816
2019-2020 1,590,000 75,912 1,665,912
$ 9,645,000 $4,393,556 $14,038,556
-32-
VILLAGE OF KEY BISCAYNE, FLORIDA
NOTES TO BASIC FINANCIAL STATEMENTS
(Continued)
NOTE 7. LONG-TERM DEBT (Continued)
Revenue Bonds (Continued)
Capital Improvement Revenue Bonds
On July 11, 2000, the Village issued a second series of $10,000,000 Capital Improvement
Revenue Bonds, Series 2000, the proceeds of which were used for the acquisition of
property and financing of the construction of the Civic Center project. The bonds mature
on July 11, 2020. The Village has pledged non -ad valorem revenues to secure payment of
the principal and interest on the bonds. The bonds are due in annual principal installments
ranging from $380,000 in fiscal year 2005 to $860,000 in fiscal year 2021. Interest
accrues at 5.24% per annum.
Debt service requirements to maturity are as follows:
Principal Interest Total
Fiscal year ending September 30:
2004 $ $ 524,000 $ 524,000
2005 380,000 514,044 894,044
2006 400,000 493,608 893,608
2007 420,000 472,124 892,124
2008 440,000 449,592 889,592
2009-2013 2,580,000 1,865,964 4,445,964
2014-2018 3,330,000 1,095,946 4,425,946
2019-2021 2,450,000 197,024 2,647,024
$10,000,000 $ 5,612,302 $15,612,302
Capital Improvement Revenue Bonds
On November 1, 2002, the Village issued Capital Improvement Revenue Bonds, Series
2002. The issuance was established similar to bond anticipation notes where the principal
amount is the lesser of $9,987,551 or the advances made under the bond. Only the amount
advanced becomes an obligation of the Village. The entire $9,987,551 is expected to be
advanced by May 1, 2004 as the civic center project will be near completion. As of
September 30, 2003, $1,660,090 had been drawn. As of issuance of these financial
statements, $4.152,993 had been drawn down. Therefore, we have presented the debt
service amortization schedule for the entire amount of the bonds as this provides relevant
data on the Village's obligation. The bonds mature on November 1, 2022. Interest is due
quarterly at a rate of 3.95% up to November 1, 2012. From November 1, 2012 to maturity,
the interest rate will become a variable rate based on certain indices.
-33-
VILLAGE OF KEY BISCAYNE, FLORIDA
NOTES TO BASIC FINANCIAL STATEMENTS
(Continued)
NOTE 7. LONG-TERM DEBT (Continued)
Revenue Bonds (Continued)
Capital Improvement Revenue Bonds (Continued)
Debt service to maturity is as follows:
Fiscal year ending September 30:
2004
2005
2006
2007
2008
2009-2013
2014-2018
2019-2022
Principal Interest
$ 95,659
391,298
405,536
420,292
435,584
2,427,514
2,902,484
2,909,484
$ 152,226
349,901
335,663
320,907
305,615
1,278,480
803,510
240,611
$ 9,987,851 $3,786,913
Total
$ 247,885
741,199
741,199
741,199
741,199
3,705,994
3,705,994
3,150,095
$13,774,764
The following is a summary of changes in long-term liabilities of the Village for business -type
activities for the year ended September 30, 2003:
Due
Beginning Ending Within
Balance Additions Reductions Balance One Year
Business -type Activities
Bonds and loan payable:
Stormwater utility revenue bonds $ 6,625,000 $ - $ 195,000 $ 6,430,000 $
Revolving loan 770,466 - 339,780 430,686 17,242
Total bonds and loan payable 7,395,466 - 534,780 6,860,686 17,242
Business -type activities:
Long-term liabilities $ 7,395,466 $ - $ 534,780 $ 6,860,686 $ 17,242
Stormwater Utility Revenue Bonds
On January 26, 1999, the Village issued $7,200,000 Stormwater Utility Revenue Bonds,
Series 1999, the proceeds of which were used to pay the principal of the $7,200,000 Bond
Anticipation Notes, Series 1995. The bonds mature on January 26, 2019. The Village has
pledged stormwater utility fees to secure payment of the principal and interest on the
bonds. The bonds are due in annual principal installments on October 1st, ranging from
$195,000 in fiscal year 2004 to $595,000 in fiscal year 2020. The payment due on
October 1, 2003 of $185,000 was paid on September 30, 2002. Interest accrues at 4.13%
per annum.
-34-
VILLAGE OF KEY BISCAYNE, FLORIDA
NOTES TO BASIC FINANCIAL STATEMENTS
(Continued)
NOTE 7. LONG-TERM DEBT (Continued)
Revenue Bonds (Continued)
Stormwater Utility Revenue Bonds (Continued)
Debt service requirements to maturity are as follows:
Principal Interest Total
Fiscal year ending September 30:
2004 $ $ 273,613 $ 273,613
2005 205,000 265,558 470,558
2006 215,000 257,093 472.093
2007 225,000 248,213 473,213
2008 235,000 238,921 473,921
2009-2013 1,930,000 994,504 2,924,504
2014-2018 2,455,000 554,659 3,009,659
2019-2020 1,165,000 72,688 1,237,688
$ 6,430,000 $ 2,905,248 $ 9,335,248
Revolving Loan
In June 1996, the Village entered into a loan agreement in the amount of $887,983 for the
financing of the planning and engineering of the proposed sanitary sewer construction
project under a State Revolving Fund Loan. The proceeds were received in fiscal year
1998. The loan is payable in semi-annual payments over 20 years beginning on April 15,
2003 at an interest rate of 2.56% per annum. The loan matures on October 15, 2022.
Principal outstanding as of September 30, 2002 is $770,466. In November 2002, the
Village prepaid approximately $373,000 of its revolving loan with the State of Florida for
its sanitary sewer construction project, which brought the outstanding balance to $437,548
prior to the first required payment on Apnl 15, 2003.
Principal Interest Total
Fiscal year ending September 30:
2004 $ 17,242 $ 10,892 $ 28,134
2005 17,686 10,448 28,134
2006 18,142 9,993 28,135
2007 18,609 9,525 28,134
2008 19,088 9,046 28,134
2009-2013 103,077 37,593 140,670
2014-2018 117,058 23,613 140,671
2019-2022 119,784 7,736 127,520
$ 430,686 $118,846 $ 549,532
-35-
VILLAGE OF KEY BISCAYNE, FLORIDA
NOTES TO BASIC FINANCIAL STATEMENTS
(Continued)
NOTE 8. COMMITMENTS AND CONTINGENCIES
Construction Commitments
As of September 30, 2003, the Village had outstanding construction commitments of
approximately $11,579,270 to complete the civic center project.
Litigation
The Village is involved in several lawsuits incidental to its operations, the outcome of which,
in the opinion of management and legal counsel, would not have a material adverse effect on
the financial condition of the Village.
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 was no reduction in insurance coverage from coverages m the
prior year and there were no settlements that exceeded insurance coverage for each of the past
three years.
Grants Contingency
Federal and State programs in which the Village participates were audited in accordance with
the provision of regulatory requirements and grantor agencies. Pursuant to those provisions,
certain programs were tested for compliance with applicable grant requirements. While no
matters of noncompliance were disclosed by the audit, government agencies may subject
grant programs to additional compliance tests that may result in disallowed costs. In the
opinion of management, future disallowances of grant expenditures, if any, would not have a
material adverse effect on the financial condition of the Village.
NOTE 9. RESERVED/DESIGNATED FUND BALANCES
As of September 30, 2003, fund balances in the governmental funds have been reserved or
designated for the following purposes:
Reserved Fund Balances
General fund:
Special disaster relief $ 135,000
Law enforcement services 171,680
Compensated absences 334,644
Emergencies 2,200,000
Working capital 126,058
$ 2,967,382
-36-
VILLAGE OF KEY BISCAYNE, FLORIDA
NOTES TO BASIC FINANCIAL STATEMENTS
(Continued)
NOTE 9. RESERVED/DESIGNATED FUND BALANCES (Continued)
Designated Fund Balances
General fund:
Inspector fees
Recreation center equipment
Playing fields
Additioal fire position
Law enforcement activities
NOTE 10. DEFINED CONTRIBUTION PLANS
$ 275,000
154,551
200,000
79,766
290,860
$1,000,177
The Village as a single -employer contributes to the Village of Key Biscayne Money Purchase
Plans, which are defined contribution plans created in accordance with Internal Revenue Code
Section 401(a). Under one Plan, which is available to Village employees, the Village contributes
12% and the employees contribute 6%. Under the second plan, which is available only to sworn
or certified police officers and firefighters, the Village contributes 12% and there is no employee
contribution. Beginning October 1, 1997, the police officers and firefighters, which elected to
participate in the defined benefit pension plan (see Note 10), were no longer eligible to
contribute to the 401(a) plan. Employer contributions for the fiscal year ended September 30,
2003 were approximately $209,000 while the employee contributions were approximately
$103,600. Amendments to the Plan must be authorized by the Village Council.
NOTE 11. DEFINED BENEFIT PENSION PLAN
Plan Description
Effective October 1, 1997, the Village established a single -employer Public Employee
Retirement System (PERS) to provide pension benefits for its police officers and firefighters.
The PERS is considered to be part of the Village's financial reporting entity and is included in
the Village's financial reports as a pension trust fund. The Plan was created under Village
Ordinance 97-21. The latest available actuarial valuation is as of October 1, 2001. The PERS
does not issue a separate audited financial report for the Plan.
Under this plan, all full-time police officers and firefighters employed by the Village are
eligible to participate The monthly retirement benefit is equal to 3% (changed from 2% in
the prior year) of the average final compensation for each year of service. The calculation for
the average final compensation is computed as one -twelfth of the average salary of the five
highest years within the last ten years of credited service. Credited service is determined by
the total number of years employed by the Village since August 1, 1993. Amendments to the
Plan must be authorized by the Village Council.
-37-
VILLAGE OF KEY BISCAYNE, FLORIDA
NOTES TO BASIC FINANCIAL STATEMENTS
(Continued)
NOTE 11. DEFINED BENEFIT PENSION PLAN (Continued)
Plan Description (Continued)
Members are vested after 5 years of service. Vested employees may retire at the earlier of age
55 and the completion of five years of credited service or the age of 52 and the completion of
25 years of credited service.
Administrative costs of the plan are financed through investment earnings. Benefits are
recorded when paid.
At October 1, 2002 (date of the latest actuarial valuation), Plan membership consisted of the
following:
Retirees and beneficiaries currently receiving benefits and terminated employees
entitled to benefits but not yet receiving them 4
Current employees:
Vested 40
Non -vested 17
Total 57
Funding Policy
From the effective date of the Plan, October 1, 1997 through September 30, 2000, the
contnbution rate by each member of the Plan is 14%. The rate will be adjusted each year
thereafter to an amount equal to the total cost for the year, as determined by the most recent
actuarial valuation, less the amount of revenue received from the State of Florida pursuant to
Chapters 175 and 185 of the Flonda Statutes. The participant contnbution rate for the year
ended September 20, 2002 was 14%. The minimum member contnbution rate is 9% of base
salary. This funding policy is designed to limit the Village's exposure to contnbute to the Plan.
Annual Pension Cost and Net Pension Obligation
The annual pension cost and net pension obligation (asset) as of October 1, 2002 was as
follows:
Annual required contribution
Interest on net pension obligation
Adjustment to annual required contribution
Annual pension cost
Contributions made
Increase in net pension obligation
Net pension obligation, beginning of year
Net pension obligation, end of year
$ 465,562
(8,633)
11,068
467,997
601,817
(133,820)
(192,047)
$ (325,867)
-38-
VILLAGE OF KEY BISCAYNE, FLORIDA
NOTES TO BASIC FINANCIAL STATEMENTS
(Continued)
NOTE 11. DEFINED BENEFIT PENSION PLAN (Continued)
Annual Pension Cost and Net Pension Obligation (Continued)
The annual required contribution for the current year was determined as part of the October 1,
2002 actuarial valuation using the aggregate actuarial cost method This method does not
identify and separately amortize unfunded actuarial liabilities. When a plan uses the
aggregate actuarial cost method, a schedule of funding progress is not required to be
presented. The actuarial assumptions included (a) 9% investment rate of return (net of
investment related expenses) and (b) projected salary increases of 6% per year. Both (a) and
(b) included an inflation component of 4%. The actuarial value of assets was determined
using the difference between actual and expected return recognized over five years.
Trend Info' illation
Annual Percentage Net Pension
Fiscal Year Pension of APC Obligation
Ended Cost (APC) Contributed (Asset)
9/30/2001 $ 46,934 284.6% $ (144,611)
9/30/2002 381,591 112.4% (192,047)
9/30/2003 467,997 129.0% (325,867)
-39-
REQUIRED SUPPLEMENTARY INFORMATION
VILLAGE OF KEY BISCAYNE, FLORIDA
REQUIRED SUPPLEMENTARY INFORMATION
BUDGETARY COMPARISON SCHEDULE
GENERAL FUND
FISCAL YEAR ENDED SEPTEMBER 30, 2003
Revenues
Property taxes
Utility taxes
Franchise fees
Licenses and permits
Intergovernmental
Charges for services
Grants
Interest
Total revenues
Expenditures:
Current:
General government:
Elected officials
Village Clerk
Administration
Village Attorney
Total general government
Public safety:
Police
Fire
Total public safety
Public works
Building, zoning and planning
Parks and recreation
Debt service:
Principal
Interest and fiscal charges
Total expenditures
Excess of revenues over expenditures
Other financing sources (uses).
Transfers in
Transfers out
Total other financing sources and uses
Net change in fund balances
Budgeted Amounts Actual
Original Final Amounts
$11,167,508
2,255,000
690,000
954,185
964,900
129,780
128,300
111,400
16,401,073
$ 11,167,508
2,255,000
690,000
954,185
964,900
129,780
128,300
111,400
16,401,073
$ 11,317,161
2,251,876
611,502
970,001
999,391
327,723
99,830
55,129
16,632,613
Variance
with
Final
Budget -
Positive
(Negative)
$ 149,653
(3,124)
(78,498)
15,816
34,491
197,943
(28,470)
(56,271)
231,540
321,306 321,306 267,225 54,081
305,643 305,643 303,469 2,174
964,751 964,751 942,728 22,023
333,000 333,000 302,038 30,962
1,924,700 1,924,700 1,815,460 109,240
3,645,134 3,645,134 3,638,285 6,849
4,051,685 4,051,685 4,046,269 5,416
7,696,819 7,696,819 7,684,554 12,265
913,301 913,301 963,247 (49,946)
1,250,330 1,250,330 1,245,119 5,211
732,604 732,604 782,065 (49,461)
1,410,000 1,410,000 1,415,000 (5,000)
1,534,997 1,534,997 1,075,069 459,928
15,462,751 15,462,751 14,980,514 482,237
938,322 938,322 1,652,099 713,777
330 330
(938,322) (938,322) (948,389) (10,067)
(938,322) (938,322) (948,059) (9,737)
- $ - $ 704,040 $ 704,040
See notes to budgetary comparison schedule.
VILLAGE OF KEY BISCAYNE, FLORIDA
REQUIRED SUPPLEMENTARY INFORMATION
NOTES TO BUDGETARY COMPARISON SCHEDULE
FISCAL YEAR ENDED SEPTEMBER 30, 2003
NOTE 1. BUDGETS AND BUDGETARY ACCOUNTING
An annual appropriated budget is prepared for the general fund.
The Village follows these procedures in establishing the budgetary data reflected in the financial
statements:
(a) The Village Manager submits to the Council a proposed operating budget for the ensuing
fiscal year. The operating budget includes appropriations and the means of financing them
with an explanation regarding each expenditure that is not of a routine nature.
(b) Public hearings are conducted to obtain taxpayer comments.
(c) Prior to October 1, the budget is legally enacted through passage of an ordinance.
(d) The Village Council, by motion, may make supplemental appropriations for the year up to
the amount of revenues in excess of those estimated. During fiscal year ended September
30, 2003, there were no supplemental appropriations.
(e) Formal budgetary integration is employed as a management control device for the general
fund.
(f) The budget for the general fund is adopted on a basis consistent with generally accepted
accounting principles (GAAP), except for certain unbudgeted expenditures of prior year
reserves.
(g)
The Village Manager is authorized to transfer part or all of an encumbered appropriation
balance within departments within a fund; however, any revisions that alter the total
appropriations of any department or fund must be approved by the Village Council. The
classification detail at which expenditures may not legally exceed appropriations is at the
department level. For the year ended September 30, 2003, expenditures exceeded
appropriations in public works by $49,946, in parks and recreation by $49,461 and in debt
service principal by $5,000 as presented in the budgetary comparison schedule on the preceding
page. It is the policy of the Village that all related revenues generated by each department be
applied to that department in determining if any department exceeds its appropriations in total.
In applying all related revenues to each department for fiscal year 2003, it was determined that
no department resulted in a deficit situation.
(h) Budget amendments were not significant in relation to the original appropriations.
_41_
VILLAGE OF KEY BISCAYNE, FLORIDA
REQUIRED SUPPLEMENTARY INFORMATION
NOTES TO BUDGETARY COMPARISON SCHEDULE
(Continued)
NOTE 2. RECONCILIATION OF BUDGETED AND ACTUAL RESULTS
The following adjustments were necessary to reconcile the budgetary comparison schedule
prepared on the budgetary basis to the statement of revenues, expenditures and changes in fund
balances prepared in accordance with generally accepted accounting principles.
General
Fund
Net change in fund balance (GAAP)
Federal expenditures not budgeted in 2003
Compensated absences not budgeted in 2003
State grant revenue not budgeted in 2003
State grant expenditures not budgeted in 2003
Net change in fund balance (budgetary basis)
$ 36,851
498,216
168,973
(73,456)
73,456
$ 704,040
-42-
VILLAGE OF KEY BISCAYNE, FLORIDA
REQUIRED SUPPLEMENTARY INFORMATION
PENSION TRUST FUND
SCHEDULE OF EMPLOYER CONTRIBUTIONS
Year Annual
Ended Required Percentage
September 30, Contribution Contributed
1998 $ - 0%
1999 1,497 2173%
2000 2,636 4199%
2001 45,199 296%
2002 377,777 114%
2003 465,562 129%
The mfoiination presented in the required supplemental schedule was determined as part of
the actuarial valuation at the date indicated. Additional information as of the latest actuarial
valuation follows. Since the Plan uses the aggregate actuarial cost method, a schedule of
funding progress is not required and has not been provided.
Valuation date 10/1/02
Actuarial cost method Aggregate
Amortization method N/A
Remaining amortization N/A
Asset valuation method Market value
Actuarial assumptions:
Investment rate of return* 9% per year compounded annually,
net of investment related expenses
Projected salary increases* 6%
Cost of living adjustments N/A
*Includes inflation at 4%
COMBINING STATEMENTS
NONMAJOR ENTERPRISE FUNDS
Enterprise funds are used to account for operations that are financed and operated in a manner
similar to private business enterprises where the intent is that the costs of providing goods or
services be financed or recovered primarily through user charges.
• Solid Waste Fund - The solid waste fund provides collection service for trash removal.
Solid waste expenses are primarily for curbside collections.
• Sanitary Sewer Construction Fund - The sanitary sewer construction fund accounts for the
development and construction of a sanitary sewer system to the unsewered areas of the
community.
VILLAGE OF KEY BISCAYNE, FLORIDA
COMBINING BALANCE SHEET
NONMAJOR ENTERPRISE FUNDS
SEPTEMBER 30, 2003
Total
Sanitary Nonmaj or
Solid Sewer Enterprise
Waste Construction Funds
ASSETS
Current assets:
Cash and cash equivalents
Receivables, net
Total current assets
Noncurrent assets:
Capital assets not being depreciated
$ 73,458 $
120,648
194,106
- $ 73,458
- 120,648
- 194,106
463,915 463,915
Total noncurrent assets 463,915 463,915
Total assets 194,106 463,915 658,021
LIABILITIES
Current liabilities:
Current portion of revolving loan
Noncurrent liabilities:
Revolving loan
Total liabilities
17,242 17,242
413,444 413,444
430,686 430,686
NET ASSETS
Invested in capital assets, net of related debt 33,229 33,229
Unrestricted 194,106 194,106
Total net assets $ 194,106 $ 33,229 $227,335
sa
VILLAGE OF KEY BISCAYNE, FLORIDA
COMBINING STATEMENTS OF REVENUES, EXPENSES AND CHANGES IN NET ASSETS
NONMAJOR ENTERPRISE FUNDS
FISCAL YEAR ENDED SEPTEMBER 30, 2003
Total
Sanitary Nonmaj or
Solid Sewer Enterprise
Waste Construction Funds
Operating revenues:
Charges for services
Operating expenses:
General and administrative
Total operating expenses
Operating income
$ 313,492 $ - $ 313,492
273,076
273,076
273,076
273,076
40,416 40,416
Non -operating revenues (expense):
Interest income 903 648 1,551
Interest expense - (6,288) (6,288)
Total non -operating revenues
(expenses) 903 (5,640) (4,737)
Income (loss) before transfers
41,319 (5,640) 35,679
Transfers in 10,067 10,067
Transfers out - (330) (330)
Net income
Net assets, beginning
Net assets, ending
41,319 4,097 45,416
152,787 29,132 181,919
$194,106 $ 33,229 $ 227,335
A
VILLAGE OF KEY BISCAYNE, FLORIDA
COMBINING STATEMENTS OF CASH FLOWS
NONMAJOR ENTERPRISE FUNDS
FISCAL YEAR ENDED SEPTEMBER 30, 2003
Total
Sanitary Nonmajor
Solid Sewer Enterprise
Waste Construction Funds
Cash flows from operating activities:
Receipts from customers and users $ 261,528 $ - $ 261,528
Payments to suppliers (273,076) - (273,076)
Net cash used by operating activities (11,548) - (11,548)
Cash flows from non -capital financing activities
Transfers from other funds 10,067 10,067
Transfers to other funds (330) (330)
Net cash provided by non -capital financing activities 9,737 9,737
Cash flows from capital and relating financing activities:
Net payments from revolving loan (339,780) (339,780)
Interest paid - (6,288) (6,288)
Net cash used by capital and related
financingactivities - (346,068) (346,068)
Cash flows from investing activities:
Interest received 903 648 1,551
Net cash provided by investing activities 903 648 1,551
Net decrease in cash and cash equivalents (10,645) (335,683) (346,328)
Cash and cash equivalents, beginning
Cash and cash equivalents, ending
Reconciliation of operating income to net cash
provided by operating activities:
Operating income
Adjustments to reconcile operating income to
net cash used by operating activities:
Changes in operating assets and liabilities:
(Increase) decrease in:
Accounts receivable
Increase (decrease) in:
Due to other funds
Total adjustments
Net cash used by operating activities
84,103 335,683 419,786
$ 73,458 $ - $ 73,458
$ 40,416 $ - $ 40,416
(72,276)
20,312
(51,964)
$ (11,548) $
- (72,276)
20,312
(51,964)
S (11,548)
sr,
STATISTICAL SECTION
VILLAGE OF KEY BISCAYNE, FLORIDA
GOVERNMENT -WIDE EXPENSES BY FUNCTION
LAST TEN FISCAL YEARS
Governmental Activities Business -type Activities
Building, Interest
Parks Zoning on
Fiscal General Public and and Long -Term Solid Sanitary
Year Government Works Police Fire Recreation Planning Debt Stormwater Waste Sewer
Total
2003 S 5,691,379 S 963,676 $ 4,787,090 $4,821,645 $ 826,695 $ 1,252,012 $ 1,064,028 $ 634,361 $ 273,076 $ 6,288 $ 20,320,250
(1) Information for fiscal year end 1994 - 2002 is unavailable in this format.
-47-
GOVERNMENT -WIDE REVENUES
LAST TEN FISCAL YEARS (1)
Fiscal
Year
2003
Program Revenues
Charges Operating Capital
for Grants and Grants and
Services Contributions Contributions
General Revenues
Taxes
(2)
Unrestricted
Investment
Earnings
$ 2,142,380 $ 99,830 $ 421,085 $ 14,180,539 $ 104,449
(1) Information for fiscal year end 1994 - 2002 is unavailable in this format.
(2) Includes property taxes, utility taxes, franchise fees and intergovernmental.
-48-
Miscellaneous
Total
$ 977,430 $ 17,925,713
VILLAGE OF KEY BISCAYNE, FLORIDA
GENERAL GOVERNMENTAL EXPENDITURES BY FUNCTION
LAST TEN FISCAL YEARS
Fiscal General Public Parks and Public
Year Government Safety Recreation Works Total
1994 S4,126,094 S 4,453,539 $ 9,601,922 (1) $782,001 $ 18,963,556
1995 5,524,305 4,294,606 211,159 573,844 10,603,914
1996 3,124,384 4,634,385 234,154 753,823 8,746,746
1997 3,577,170 5,017,882 239,029 660,780 9,494,861
1998 3,671,970 5,278,315 255,704 828,287 10,034,276
1999 4,173,995 5,644,903 293,664 730,521 10,843,083
2000 4,795,894 6,068,147 380,502 830,360 12,074,903
2001 5,015,845 6,172,932 452,804 933,096 12,574,677
2002 6,230,222 6,926,254 539,058 802,218 14,497,752
2003 5,550,648 8,351,743 782,065 963,247 15,647,703
Note: Includes general fund only (GAAP basis).
Note General government includes economic development, building, zoning and planning, debt service,
capital outlay and non -departmental expenditures.
(1) Includes acquisition of land for $9,238,317 for the Village Green.
n
VILLAGE OF KEY BISCAYNE, FLORIDA
GENERAL GOVERNMENTAL REVENUES BY SOURCE
LAST TEN FISCAL YEARS
Fiscal Property
Year Taxes
Licenses
and
Permits
Inter- Utility
Governmental Taxes
Franchise
Fees Other (1) Interest Total
1994 $ 6,640,045 $ 629,246 $ 997,501 $ L268,428 $ 668,020 $ 115,664 $ 288,978 $ 10,607,882
1995 6,820,807 351,152
1996 6.486,019 430,208
1997 6.495,465 531,401
1998 6.963.900 1,003.768
1999 7,012,714 668,672
2000 7,799.633 1,316,641
2001 8,738.608 1,308,229
2002 9,569.030 859,435
2003 11;317.161 970,001
788,062
791,403
766.638
843,812
807,924
889.704
930,169
1,257,179
1,294,486
1.555.812
1,514.697
1,621,473
1,723.902
1,772.208
971.136 2,258.931
999,391 2.251.876
Note. Includes general fund only (GAAP basis)
(1) Includes charges for services, grants, contributions and other
652.844 665,086 369,540
638,096 1,495,521 280,570
667,815 463,171 248,646
709,067 392,975 233,654
740,031 1,295,001 231,820
729,998 348,552 315,959
738,513 736,881 291.408
639,072 608.012 89.838
611,502 427,553 55.129
10, 904, 670
11,416,303
10,728,948
11,661,873
12,377,635
13,124,389
14,516,016
14.995.454
16,632.613
cn
VILLAGE OF KEY BISCAYNE, FLORIDA
UTILITY TAX REVENUE BY SOURCE
LAST TEN FISCAL YEARS
Fiscal Telecom- Fuel
Year Electricity mtuncations Gas Oil Water Total
1994 $ 888,752 $ 202,702 $ 26,925 $ 4,331 $ 145,719 $ 1,268,429
1995 875,704 186,780 38,130 3,920 152,645 1,257,179
1996 888,651 199,746 37,034 3,885 165,169 1,294,485
1997 1,032,445 274,768 42,066 3,616 202,918 1,555,813
1998 989,535 288,581 36,427 3,883 196,271 1,514,697
1999 992,319 380,934 35,121 4,262 208,837 1,621,473
2000 1,000,553 454,101 52,016 2,169 215,063 1,723,902
2001 1,018,973 492,442 62,833 245 197,715 1,772,208
2002 1,097,566 904,475 n) 52,360 318 203,612 2,258,331
2003 1,162,030 825,739 61,137 486 202,394 2,251,786
FRANCHISE FEE REVENUE BY SOURCE
LAST TEN FISCAL YEARS
Fiscal Cable
Year Electricity Television Telephone Total
1994 $ 603,638 $ 43,877 $ 20,505 $668,020
1995 589,031 43,899 19,914 652,844
1996 571,093 46,824 20,179 638,096
1997 578,195 62,342 27,277 667,814
1998 631,323 53,728 24,016 709,067
1999 653,799 56,997 29,235 740,031
2000 646,000 59,548 24,450 729,998
2001 678,316 67,855 37,342 783,513
2002 639,072 - (ii (i) 639,072
2003 611,502 - - 611,502
(1) Simplified communications tax effective October 1, 2001 replaced the utility tax and franchise fees
on telecommunications and cable television
VILLAGE OF KEY BISCAYNE, FLORIDA
PROPERTY TAX LEVIES AND COLLECTIONS
LAST TEN FISCAL YEARS
Tax Fiscal Assessed Tax Total Percent
Year(1) Year Value Levy Collected') Collected
1994 1995 $ 1,741,921,584 $ 7,143,620 $ 6,820,807 95.5%
1995 1996 1,767,457,005 6,716,337 6,418,864 95.6%
1996 1997 1,861,243,132 6,711,642 6,495,465 96.8%
1997 1998 2,003,049,232 7,222,995 6,948,521 96.2%
1998 1999 2,028,174,208 7,313,596 7,012,714 95.9%
1999 2000 2,232,457,904 8,050,243 7,799,633 96.9%
2000 2001 2,499,049,161 9,011,571 8,738,608 97.0%
2001 2002 2,731,833,645 9,850,992 9,515,138 96.6%
2002 2003 3,259,919,981 11,755,271 11,317,160 96.3%
(1) Assessments as of January 1 of the year listed; bills mailed in October of that year; taxes become
delinquent at the end of April of the subsequent year. Initial property tax levy by the Village
October, 1992.
(2) Collections reflect timely payment discounts of up to 4% and other adjustments.
VILLAGE OF KEY BISCAYNE, FLORIDA
ASSESSED AND ESTIMATED ACTUAL VALUE OF TAXABLE PROPERTY
LAST TEN FISCAL YEARS
Net
Assessed
Tax Real Personal Property
Year Property Property Value
1994 S1,715,626,471 S 26,295,1 13 S 1,741,921,584
1995 1,744,363,535 23,093,470 1,767,457,005
1996 1,837,939,078 23,304,054 1,861,243,132
1997 1,978,219,125 24,830,107 2,003,049,232
1998 2,004.007,700 24,166,508 2,028,174,208
1999 2,205,371,189 27,086,715 2,232,457,904
2000 2,470,115,075 28,934,086 2,499,049,161
2001 2,701,084,167 30,749,478 2,731,833,645
2002 3,227,971,184 31,948,797 3,259,919,981
2003 3,617.880,990 43,233,556 3,661,114,546
Source: Miami -Dade County Property Appraiser's Office
Note. Assessed values equal the estimated actual 1/alue
-53-
PROPERTY TAX RATES
DIRECT AND OVERLAPPING GOVERNMENTS
LAST TEN FISCAL YEARS
Village of
Key Biscayne
Miami -Dade County
State School District
Debt Total Total Debt Total
Fiscal Village Operating Service County SFWMD FIND State Operating Service School
Year Millage Millage Millage Millage Millage Millage Millage Millage Millage Millage Other Total
1994 4 101 7 253 0 817 8 070 0 497 0 049 0.546 9 503 0 842 10 345 0 443 23 505
1995 3 800 6 828 0 789 7 617 0 547 0 040 0 587 9 373 1 016 10 389 0 429 22 822
1996 3 606 6 469 0 774 7 243 0.572 0 038 0.610 9 356 1 010 10 366 0 439 22.264
1997 3 606 6 023 0 929 6 952 0 597 0 050 0 647 9 356 1 106 10 462 0 416 22 083
1998 3 606 6 023 0 837 6 860 0 597 0 047 0 644 9 182 0 978 10 160 0 434 21 704
1999 3 606 5 809 0 816 6 625 0 597 0 044 0 641 8 654 0 990 9 644 0.421 20 937
2000 3 606 5 751 0 652 6 403 0.597 0 041 0 638 8 702 0 915 9.617 0 451 20 715
2001 3 606 5 713 0 552 6 265 0 697 0 039 0 736 8 528 0 848 9 376 0 451 20 434
2002 3.606 5 889 0 390 6 279 0 697 0 039 0 736 8.482 0 770 9 252 0 451 20 324
2003 3 606 5 969 0 285 6 254 0 597 0 039 0 636 8 418 0 682 9 100 1 086 20 682
(1) Village established its own fire district effective October 1, 1993
Source Miami -Dade County Property Appraiser's Office
-54-
VILLAGE OF KEY BISCAYNE, FLORIDA
RATIO OF ANNUAL DEBT SERVICE EXPENDITURES FOR NET
BONDED DEBT TO GENERAL GOVERNMENTAL EXPENDITURES
LAST TEN FISCAL YEARS
Ratio of Debt
Total Service to
Total General General
Fiscal Debt Governmental Governmental
Year Principal Interest (1) Service (2) Expenditures Expenditures
1994 S $ 194,989 $ 194,989 $ 19,053,562 01.0%
1995 755,000 384,661 1,139,661 10,603,914 10.7%
1996 785,000 351,089 1,136,089 8,746,746 13.0%
1997 820,000 315,901 1,135,901 9,494,861 12.0%
1998 855,000 277,825 1,132,825 10,034,276 11.3%
1999 895,000 241,329 1,136,329 10,843,083 10.5%
2000 935,000 595,767 1,530,767 12,074,903 12.7%
2001 975,000 631,875 1,606,875 12,574,677 12.8%
2002 1,015,000 1,420,845 2,435,845 14,497,752 16.8%
2003 1,415,000 590,737 2,005,737 15,647,703 12,8%
Note: Includes general fund only. No debt prior to 1994.
(1) Excludes bond issuance and other costs
(2) Debt service on revenue bonds
VILLAGE OF KEY BISCAYNE, FLORIDA
SCHEDULE OF DIRECT AND OVERLAPPING BONDED DEBT
GENERAL OBLIGATION BONDS
(IN THOUSANDS)
SEPTEMBER 30, 2003
Jurisdiction
Net
General Percentage Amount
Obligation Applicable Applicable
Taxable Bonded to to
Property Debt Key Key
Value (1) Outstanding Biscayne Biscayne
Direct:
Village of Key Biscayne $ 3,661,115 $ 28,840
Overlapping:
Miami -Dade County
Miami -Dade County Schools
130,106,101 247,541 (2)
131,120,085 790,200 (2)
$ 1,037,741
100.00% $ 28,840
2.81% (3)
2.79% (3)
6,966
22,064
$ 29,030
(1) Source: Miami -Dade County Property Appraiser's Office - Taxable Property Value reflects
January 1, 2003 amounts.
(2) Source: Miami -Dade County Finance Department - Net General Obligation Bonded Debt
outstanding figures are as of September 30, 2003.
(3) Based on the percentage of the County's and School Board's tax roll valuation comprised of real
and personal property situated in the Village of Key Biscayne.
VILLAGE OF KEY BISCAYNE, FLORIDA
RATIO OF NET BONDED DEBT
TO ASSESSED VALUE AND PER CAPITA
LAST TEN FISCAL YEARS
Ratio
of Net
Bonded
Net Debt to
Fiscal Assessed Bonded Assessed
Year Population Value (1) Debt (2) Value
1994 8,887 $1,560,057,130 $9,200,000 0 59%
1995 8,894 1,741,921,584 8,445,000 0.48%
1996 8,886 1,767,457,005 7,660,000 0.43%
1997 8,937 1,861,243,132 6,840,000 0.37%
1998 9,471 2,003,049,232 5,985,000 0.30%
1999 9,689 2,028,174,208 22,290,000 1 10%
2000 10,507 2,223,956,5 15 21,220,000 0 95%
2001 10,607 2,499,049,161 30,120,000 1 21%
2002 10,698 2,731,833,645 29,935,000 1.10%
2003 11,100 3,259,919,981 29,271,000 0.90%
Note. Village had no debt prior to 1994
(1) Net bonded assessed actual value of taxable property
(2) Net bonded debt represents revenue bonds
Net
Bonded
Debt
Per
Capita
$ 1,035
949
862
765
632
2,300
2,190
2,823
2,798
2,637
VILLAGE OF KEY BISCAYNE, FLORIDA
REVENUE BOND COVERAGE
STORMWATER REVENUE BONDS (SERIES 1999) (1)
LAST TEN FISCAL YEARS
Net
Revenue
Gross Available
Stormwater for Debt Service Requirements
Fiscal Fee Operating Debt
Year Revenue Expenses Service Principal Interest Total Coverage
1999 $ 480,586 $ 42,773 $437,813 $ - $ 335,412 $ 335,412 130.53%
2000 494,955 33,453 461,502 135,000 281,875 416,875 110.71%
2001 518,961 79,708 439,253 125,000 291,622 416,622 105.43%
2002 559,239 85,091 474,148 130,000 336,253 466,253 101.69%
2003 551,774 86,829 464,945 195,000 273,613 468,613 99.22%
VILLAGE OF KEY BISCAYNE, FLORIDA
DEMOGRAPHICS STATISTICS
POPULATION
Estimates of Population by Age
Year
2000
Estimates of Population by Race
2000
INCOME*
Per Capita Income
Under 20 Years 20 to 64 Years 65 Years or Older
Number Percent Number Percent Number Percent Total
2,697 26 6,176 59 1,634 15 10,507
Anglo Black Hispanic Total
5,228 48 5,231 10,507
Average
Per
Anglo Black Hispanic Capita
2000 $ 62,542 $ 13,417 $ 46,682 $ 54,612
UNEMPLOYMENT RATES (Percent)
Miami -Dade County*
Village of Key Biscayne
* Source: U.S. Bureau of Labor Statistics
1994 1995 1996 1997 1998 1999 2000 2001 2002 2003
7.9 6.8 7.8 7.1 6.7 5.9 5.6 5.7 7.4 7 3
3.6 3 1 3 6 3.3 3.1 2.7 2.6 2.8 3 2 3 2
-59
VILLAGE OF KEY BISCAYNE, F LORIDA
PROPERTY VALUE, CONSTRUCTION AND BANK DEPOSITS
LAST TEN FISCAL YEARS
Residential Commercial (000s Omitted)
Total Total County Village
Fiscal Permits # of # of of Bank Bank
Year Issued Permits Valuation Permits Valuation Construction Deposits (1) (2) Deposits (2)
1994 2,205 2,081 $25,410,312 124 $45,567,390 $70,977,702 $ 17,524,140 (1) $
1995 2,857 2,568 33,820,503 289 2,099,661 35,920,164 17,938,762 (1)
1996 3,171 3,060 65,318,655 111 1,231,097 66,549,752 14,561,654 (1) -
1997 3,570 3,402 82,481,700 168 667,328 83,149,028 34,664,829 (1)
1998 3,002 2,879 129,200,900 106 3,176,031 132,376,931 36,659,805 347,178
1999 2,711 2,416 94,287,095 295 56,792,994 151,080,089 39,633,149 377,060
2000 1,793 1,641 85,244,371 152 9,359,770 94,604,141 38,539,107 364,973
2001 749 667 59,607,528 82 10,485,477 70,093,005 45,064,000 328,602
2002 856 769 23,206,296 87 1,101,721 24,308,017 51,297,000 311,837
2003 1,324 1,178 22,695,672 146 12,454,140 35,149,812 56,263,926 328,303
(1) State of Florida, Division of Financial Services, as of June 30 of each respective year through fiscal
year 2002 Information is for Miami -Dade County, which the Village of Key Biscayne was apart of.
(2) Deposits within Village of Key Biscayne limits Information for all years presented was not available
from Federal Deposit Insurance Corporation, from fiscal year 2003 and forward.
VILLAGE OF KEY BISCAYNE, FLORIDA
PRINCIPAL TAXPAYERS
SEPTEMBER 30, 2003
Taxpayer
Sonesta Beach Resort, LP
GB Hotel Partners, Ltd.
Key Biscayne Ocean Club Ltd. Partners
Ocean Club Community Association
PITU, Inc.
Galleria of Key Biscayne, Inc.
Claudio Alvarez
Red Dragon Sands, LTD.
John Dasburg
Yoyot Realty, Inc.
Source: Miami -Dade County Appraiser's Office
% of
Total
Taxable Assessed
Valuation Valuation
$ 39,921,710 1.22%
26,929,342 0 83%
17,486,700 0 54%
12,500,000 0.38%
9,657,016 0 30%
8,741,107 0.27%
8,505,544 0.26%
8,470,400 0.26%
6,828,983 0.21%
5,849,394 0 18%
$ 144,890,196 4.45%
_AI-
VILLAGE OF KEY BISCAYNE, FLORIDA
MISCELLANEOUS STATISTICAL DATA
SEPTEMBER 30, 2003
Date of Incorporation 1991
Form of Government Council -Manager
Area 1.25 Square Miles
Miles of Street 22.4 Linear Miles
Fire Protection:
Number of Stations 1
Police Protection:
Number of Stations 1
Education:
Attendance Centers 2
Number of Students 1,480
Number of Teachers 90
Miami -Dade County Water & Sewer Authority
Number of Customers
Average Daily Consumption
1,957
12,434,314 gallons
Sewers:
Number of Customers 926
Fire Hydrants 249
Building Permits Issued 856
Recreation and Culture:
Number of Parks 3
Number of Libraries I (Operated by Miami -Dade County)
Number of Tennis Centers 1
Number of Recreational Centers 1
Employees:
Full Time
96
COMPLIANCE SECTION
Cohen
&Holtz
Accountants Advisors
Report of Independent Certified Public Accountants on Compliance and on
Internal Control over Financial Reporting Based on an Audit of Financial Statements
Performed in Accordance with Government Auditing Standards
Honorable Mayor, Village Council and Village Manager
Village of Key Biscayne, Florida
We have audited the financial statements of the governmental activities, the business -type activities, each
major fund, and the aggregate remaining fund information of the Village of Key Biscayne, Florida (the
Village) as of September 30, 2003 and for the year then ended which collectively comprise the Village's
basic financial statements, and have issued our report dated December 26, 2003. We conducted our audit
in accordance with auditing standards generally accepted in the United States and the standards
applicable to financial audits contained in Government Auditing Standards, issued by the Comptroller
General of the. United States.
Compliance
As part of obtaining reasonable assurance about whether the Village's basic financial statements are free
of material misstatement, we performed tests of its compliance with certain provisions of laws,
regulations, contracts and grants, non-compliance with which could have a direct and material effect on
the detennmation 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 non-compliance that are required to be reported under
Government Auditing Standards.
Internal Control over Financial Reporting
In planning and performing our audit, we considered the Village's internal control over financial
reporting in order to determine our auditing procedures for the purpose of expressing our opinion on the
basic financial statements and not to provide assurance on the internal control over financial reporting.
Our consideration of the internal control over financial reporting would not necessarily disclose all
matters in the internal control over financial reporting that might be material weaknesses. A material
weakness is a condition in which the design or operation of one or more of the internal control
components does not reduce to a relatively low level the risk that misstatements in amounts that would be
material in relation to the financial statements being audited may occur and not be detected within a
timely period by employees in the normal course of performing their assigned functions. We noted no
matters involving the internal control over financial reporting and its operation that we consider to be
material weaknesses.
-63-
Rachlin Cohen & Holtz LLP
One Southeast Third Avenue • Tenth Floor • Miami, Florida 33131 • Phone 305.377 4228 • Fax 305 377.8331 • www.rachlin.com
An Independent Member of Baker Tilly International
MIAMI • FORT LAUDERDALE ■ WEST P A IL M RFAPH • STUART ■ TAMPA • HEW I F R C F Y
Honorable Mayor, Village Council and Village Manager
Village of Key Biscayne, Florida
Page Two
However, we noted one matter that we have reported to management in the schedule of findings and
questioned costs accompanying this report.
This report is intended solely for the information and use of the Mayor, Village Council, management
and regulatory agencies, and is not intended to be and should not be used by anyone other than these
specified parties.
d'ig..t • 4tei
Miami, Florida
December 26, 2003
-64-
Cohen
cfHoltz
Cohen
&Holtz
Accountants Advisors
Management Letter in Accordance with the Rules of the
Auditor General of the State of Florida
Honorable Mayor, Village Council and Village Manager
Village of Key Biscayne, Florida
We have audited the financial statements of the governmental activities, the business -type activities, each
major fund, and the aggregate remaining fund information of the Village of Key Biscayne, Florida (the
Village) as of and for the year ended September 30, 2003 which collectively comprise the Village's basic
financial statements, and have issued our report thereon dated December 26, 2003. We conducted our
audit in accordance with auditing standards generally accepted in the United States and the standards
applicable to financial audits contained in Government Auditing Standards, issued by the Comptroller
General of the United States, and OMB Circular A-133, Audits of States, Local Governments, and Non -
Profit Organizations. We have issued our Report of Independent Certified Public Accountants on
Compliance and on Internal Control over Financial Reporting, a Report of Independent Certified Public
Accountants on Compliance Applicable to Each Major Program and Internal Control over Compliance in
Accordance with OMB Circular A-133 and a Schedule of Findings and Questioned Costs. Disclosures in
those reports, which are dated December 26, 2003, should be considered in conjunction with this
management letter.
In connection with our audit of basic financial statements of the Village for the year ended September 30,
2003, we report the following in accordance with Chapter 10.550 Rules of the Auditor General, Local
Government Entity Audits, which requires that this report specifically address but not be limited to the
matters outlined in Rule 10.554(1)(g).
1. No inaccuracies, shortages, defalcations, fraud and/or violations of laws, rules, regulations and
contractual provisions were reported in the preceding annual financial audit.
2. Recommendations made in the preceding annual financial audit have been addressed.
3. The Village, during fiscal year 2003, was not in a state of financial emergency as defined by
Florida Statutes 218.503(1). The Village has no deficit fund balances for two consecutive years.
4 Recommendations to improve the Village's present financial management and accounting
procedures are accompanying this report in the schedule of findings and questioned costs.
5. The Village was in compliance with Section 218.415, Florida Statutes, regarding the investment
of public funds.
-65-
Rachlin Cohen & Holtz LLP
One Southeast Third Avenue • Tenth Floor • Miami, Florida 33131 • Phone 305 377.4228 • Fax 305 377 8331 • www.rachlin.com
An Independent Member of Baker Tilly International
MIAMI • FORT LAIIOFROAI F • WFST PA1 M RFAPR • STIIeRT • TeMPe • NFW 1 FRCFV
Honorable Mayor, Village Council and Village Manager
Village of Key Biscayne, Florida
Page Two
6. During the course of our audit, nothing came to our attention that caused us to believe that the
Village:
a. Was in violation of any laws, rules or regulations and contractual provisions.
b. Made any illegal or improper expenditures.
c. Had improper or inadequate accounting procedures.
d. Failed to record financial transactions.
e. Had other inaccuracies, shortages, defalcations or instances of fraud.
7. The annual financial report for the year ended September 30, 2003 has been filed with the
Department of Financial Services pursuant to Section 218.32(1)(a), Florida Statutes and is in
agreement with the audited financial statements for the fiscal year ended September 30, 2003.
8. The Village was incorporated by Laws of Florida 90-142. There were no component units
related to the Village.
9. During the course of our audit, we applied financial condition assessment procedures pursuant to
Rule 10.566(8). It is management's responsibility to monitor the Village's financial condition,
and our financial condition assessment, which was performed as of the Village's fiscal year end,
was based on representations made by management and the review of financial information
provided by the Village. There were no findings that identified deteriorating financial conditions.
This report is intended solely for the information and use of the Mayor, Village Council, management,
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.
Aeieg,•-d. s „gr/ w
Miami, Florida
December 26, 2003
-66-
Cohen
&Holtz
Accountants Advisors
Report of Independent Certified Public Accountants on Compliance
Applicable to Each Major Program and Internal Control over
Compliance in Accordance with OMB Circular A-133
Honorable Mayor, Village Council and Village Manager
Village of Key Biscayne, Florida
Compliance
We have audited the compliance of the Village of Key Biscayne, Florida (the Village) with the types of
compliance requirements described in the US Office of Management and Budget (OMB) Circular A-133
Compliance Supplement, that are applicable to its major federal awards program for the fiscal year ended
September 30, 2003. The Village's major federal awards program is identified in the summary of
auditor's results section of the accompanying schedule of findings and questioned costs. Compliance
with the requirements of laws, regulations, contracts and grants applicable to its major federal awards
program is the responsibility of the Village's management. Our responsibility is to express an opinion on
the Village's compliance based on our audit.
We conducted our audit of compliance in accordance with auditing standards generally accepted in the
United States; the standards applicable to financial audits contained in Government Auditing Standards,
issued by the Comptroller General of the United States; OMB Circular A-133, Audits of States, Local
Governments, and Non -Profit Organizations, Those standards and OMB Circular A-133, requires that
we plan and perform the audit to obtain reasonable assurance about whether non-compliance with the
types of compliance requirements referred to above that could have direct and material effect on a major
federal awards program occurred. An audit includes examining, on a test basis, evidence about the
Village's compliance with those requirements and performing such other procedures as we considered
necessary in the circumstances. We believe that our audit provides a reasonable basis for our opinion.
Our audit does not provide a legal determination on the Village's compliance with those requirements.
In our opinion, the Village complied, in all material aspects, with the requirements referred to above that
are applicable its major federal awards program and state financial assistance project for the year ended
September 30, 2003.
Internal Control over Compliance
The management of the Village is responsible for establishing and maintaining effective internal control
over compliance with requirements of laws, regulations, contracts and grants applicable to federal awards
programs. In planning and performing our audit, we considered the Village's internal control over
compliance with requirements that could have a direct and material effect on each major federal awards
programs in order to determine our auditing procedures for the purpose of expressing our opinion on
compliance and to test and report on internal control over compliance in accordance with OMB Circular
A-133.
-67-
Rachlin Cohen & Holtz LLP
One Southeast Third Avenue • Tenth Floor • Miami, Florida 33131 • Phone 305.377.4228 • Fax 305.377.8331 • www.rachlin.com
An Independent Member of Baker Tilly International
MIAMI • FORT LAUDERDALE • WEST PALM BEACH • STUART • TAMPA • NEW JERSEY
Honorable Mayor, Village Council and Village Manager
Village of Key Biscayne, Florida
Page Two
Our consideration of the internal control over compliance would not necessarily disclose all matters in
the internal control that might be material weaknesses. A material weakness is a condition in which the
design or operation of one or more of the internal control components does not reduce to a relatively low
level the risk that non-compliance with applicable requirements of laws, regulations, contracts and grants
that would be material in relation to a major federal awards program being audited may occur and not be
detected within a timely period by employees in the normal course of performing their assigned
functions. We noted no matters involving the internal control over compliance and its operation that we
consider to be material weaknesses.
This report is intended solely for the information and use of the Mayor, Village Council, management
and specific legislative or regulatory bodies and is not intended to be and should not be used by anyone
other than these specified parties.
/444, z4.,
Miami, Florida
December 26, 2003
-68-
Cohen
&Holtz
VILLAGE OF KEY B ISCAYNE, FLORIDA
SCHEDULE OF EXPENDITURES OF FEDERAL AWARDS
FISCAL YEAR ENDED SEPTEMBER 30, 2003
Federal Grantor/Pass Through Grantor Programs
Federal
Federal Grant/
CFDA Contract Federal
Number Number Expenditures
U.S. Department of Treasury
Federal Equitable Sharing Program N/A N/A $ 498,216
U.S. Department of Justice
Pass through Miami -Dade County.
Byrne Grant
Pass through the Florida Department of Law Enforcement
Law Enforcement Block Grant
Total U.S. Department of Justice
16 579 HSB423 86
16 592 03-C.f-2Q-11-12-02-094 10,000
10,086
Total Expenditures of Federal Awards $ 508,302
N/A - Not available
See note to schedule of expenditures of federal awards
-69-
VILLAGE OF KEY BISCAYNE, FLORIDA
NOTE TO SCHEDULE OF EXPENDITURES OF FEDERAL AWARDS
FISCAL YEAR ENDED SEPTEMBER 30, 2003
NOTE 1. BASIS OF PRESENTATION
The accompanying schedule of expenditures of federal awards includes the federal grant activity
of the Village of Key Biscayne and is presented on the modified accrual basis of accounting.
The information in this schedule is presented in accordance with the requirements of OMB
Circular A-133, Audits of States, Local Governments, and Non -Profit Organizations. Therefore,
some amounts presented in this schedule may differ from amounts presented in, or used in the
preparation of, the basic financial statements.
-70-
VILLAGE OF KEY BISCAYNE, FLORIDA
SCHEDULE OF FINDINGS AND QUESTIONED COSTS
FISCAL YEAR ENDED SEPTEMBER 30, 2003
SECTION I - SUMMARY OF AUDITOR'S RESULTS
Financial Statements
Type of auditor's report issued: Unqualified Opinion
Internal control over financial reporting:
Material wealmess(es) identified? yes X no
Reportable condition(s) identified not considered to be
material weakness? yes X none reported
Non-compliance material to financial statements noted?
Federal Awards Pro,'rams
yes X no
Internal control over major awards programs:
Material weakness(es) identified? yes X no
Reportable condition(s) identified not considered to be
material weakness? yes X none reported
Type of auditor's report issued on compliance for major
federal awards program: Unqualified Opinion
Any audit findings disclosed that are required to be reported
in accordance with Circular A-133, Section .510(a)? yes X no
Identification of federal major awards program:
Federal Program Federal CFDA No.
Federal Equitable Sharing Program N/A
Dollar threshold used to distinguish between Type A and
Type B programs: $300,000
Auditee qualified as low risk auditee for audit of federal awards
program? yes X no
-71-
VILLAGE OF KEY BISCAYNE, FLORIDA
SCHEDULE OF FINDINGS AND QUESTIONED COSTS
(Continued)
SECTION II - FINANCIAL STATEMENT FINDINGS
Other Matter
03-1. Accounting Treatment, for Expenditures
At the end of each fiscal year, Village Council and Management establish reservations of fund balance
that are presented in the financial statements. In the ensuing year, expenditures are generally made
against those reserves. We noted that the Village has on occasion charged the expenditure directly
against the reserve rather than presenting the expenditure as such m the financial statements which has
the effect of flowing into and reducing the established reserves. Without this methodology, all
expenditures of the Village would not be properly accounted for and presented in accordance with
generally accepted accounting principles.
Recommendation
We recommend, as it relates to reservations of fund balance, that in order to properly reflect revenues
and expenditures of the Village in the financial statements, and in accordance with generally accepted
accounting principles, charges against reserves should first be presented as an expenditure which will
then have the effect of reducing the related reserve,
Management Response
The Village will continue to record items previously reserved and designated in the manner established in
prior years, directly against those reserves/designations. A reconciliation process to preserve the proper
methodology of flowing such items into and out of respective departments will be reviewed annually.
SECTION III - FEDERAL AWARD FINDINGS AND QUESTIONED COSTS
None
-72-
VILLAGE OF KEY BISCAYNE, FLORIDA
SUMMARY SCHEDULE OF PRIOR AUDIT FINDINGS
FISCAL YEAR ENDED SEPTEMBER 30, 2003
PRIOR YEAR COMMENTS AND STATUS
None
-73-
9
Village Seal Description
One of the oldest and most recognizable landmarks in South Florida, the lighthouse was
first constructed in 1825. It has a colorful, well -documented history. It stands in the Bill Baggs
Cape Florida State Recreation Area. Like all lighthouses, it is a symbol of familiar homecoming
to sailors, fishermen, and landlubbers alike. It also represents man-made structures of lasting
quality, strength and safety in an uncertain world.
The coconut palm, threatened by disease in Florida in recent years, has been a popular
symbol of peaceful nature for many tropical areas around the world. Key Biscayne was once a
plantation for this versatile tree.
The two sea birds, against the backdrop of the moon, stand for the animals with whom we
share our environment.
The sun, sustainer of life, which figures prominently in many municipal emblems around
the state, usually depicted at high noon, has just disappeared below the horizon, creating
one of those sunsets that occur every once in a while. This kind of mood and feeling evoke a
universal human reaction — a powerful visual reminder of the potential beauty and transitory
nature of all things.
The moon is shown on our seal not just to be different from other communities, not only for
its magical qualities, but also because we have been told that one of the earliest local Indian
dialects contained a word -picture phrase, "Bischiyano," meaning, simply — "Favorite Path of
the Rising Moon."
Adoption of the Village Seal took place on June 8, 1993 and adoption of the description of
the Village Seal took place on August 10, 1993.