HomeMy Public PortalAboutCAFR 2010.pdfVILLAGE OF KEY BISCAYNE, FLORIDA
COMPREHENSIVE ANNUAL FINANCIAL REPORT
FISCAL YEAR ENDED SEPTEMBER 30, 2010
Prepared by:
THE FINANCE DEPARTMENT
VILLAGE OF KEY BISCAYNE, FLORIDA
COMPREHENSIVE ANNUAL FINANCIAL REPORT
FISCAL YEAR ENDED SEPTEMBER 30, 2010
TABLE OF CONTENTS
Introductory Section
Letter of Transmittal ..................................................................................................................... i
Village Officials ............................................................................................................................v
Certificate of Achievement for Excellence in Financial Reporting ............................................ vi
Organization Chart ..................................................................................................................... vii
Financial Section
Independent Auditors’ Report .................................................................................................. 1-2
Management’s Discussion and Analysis (Required Supplementary Information) ................. 3-10
Basic Financial Statements
Government-Wide Financial Statements:
Statement of Net Assets ........................................................................................................11
Statement of Activities ..........................................................................................................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 .................................................................................. 21-51
Required Supplementary Information (Other Than MD&A)
Budgetary Comparison Schedule – General Fund ......................................................................52
Note to Budgetary Comparison Schedule ...................................................................................53
Schedule of Funding Progress – Pension Trust Fund .................................................................54
Schedule of Employer Contributions – Pension Trust Fund ......................................................55
Schedule of Funding Progress – Other Post Employment Benefits ...........................................56
VILLAGE OF KEY BISCAYNE, FLORIDA
COMPREHENSIVE ANNUAL FINANCIAL REPORT
FISCAL YEAR ENDED SEPTEMBER 30, 2010
TABLE OF CONTENTS
Statistical Section
Net Assets by Component ...........................................................................................................57
Changes in Net Assets .......................................................................................................... 58-59
Fund Balances of Governmental Funds ......................................................................................60
Changes in Fund Balances of Governmental Funds ...................................................................61
General Governmental Tax Revenues by Source .......................................................................62
Net Assessed Value and Estimated Actual Value of Taxable Property .....................................63
Property Tax Rates – Direct and Overlapping Governments .....................................................64
Principal Property Taxpayers ......................................................................................................65
Property Tax Levies and Collections ..........................................................................................66
Ratios of Outstanding Debt by Type ..........................................................................................67
Ratios of General Bonded Debt Outstanding .............................................................................68
Direct and Overlapping Governmental Activities Debt .............................................................69
Pledged Revenue Coverage ........................................................................................................70
Demographic and Economic Statistics .......................................................................................71
Principal Employers ....................................................................................................................72
Full-Time Equivalent Village Government Employees by Function .........................................73
Operating Indicators by Function/Program ................................................................................74
Capital Asset Statistics by Function/Program ............................................................................75
Compliance Section
Independent Auditors’ Report on Internal Control over Financial Reporting
and on Compliance and Other Matters Based on an Audit of Financial
Statements Performed in Accordance with Government Auditing Standards ................... 76-77
Management Letter in Accordance with the Rules of the Auditor General of the
State of Florida ................................................................................................................... 78-80
Independent Auditors’ Report on Compliance With Requirements That Could
Have a Direct and Material Effect on Each Major Program and on Internal
Control over Compliance in Accordance With OMB Circular A-133 .............................. 81-82
Schedule of Expenditures of Federal Awards ................................................................................83
Note to Schedule of Expenditures of Federal Awards ...................................................................84
Summary Schedule of Prior Audit Findings ..................................................................................85
Schedule of Findings and Questioned Costs ............................................................................ 86-88
INTRODUCTORY SECTION
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Genaru "(:hip" Iglesias
VILLAGE
March 23, 2011
OF KEY BISCAYNE
Office of the Village Manager
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 firm 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, 2010.
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 firm of Marcum 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, 2010 are free of
material misstatement. The independent audit involved examining, on a test
basis,
88 West McIntyre Street • Suite 210 • Key Biscayne, Florida 33149 • (305) 365-5500 • Fax (305) 365-8936
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evidence supporting the amount and 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, 2010, 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 independent auditors' report.
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 12,344. 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 for, among other things, 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 5chool 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 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 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.
ii
Local Economy
The Village of Key Biscayne enjoys a favorable economic environment and local indicators point 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 shopping centers. There is no
industrial area in the community.
Property values were once again lower during the past year following nationwide trends. Continuing
weakness in the national and state economy will constrain the growth of property tax revenues and will
likely have an unfavorable impact on many of the Village's intergovernmental revenues such as sales tax
and state revenue sharing. The Village continues to monitor operating expenses closely while seeking
additional cost-cutting measures to mitigate any future loss of revenue.
Long -Term Financial Planning
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. Additionally, the Village has
modified its 5 -Year Capital Plan by prioritizing needs based on its expected available resources
determined by its 5 -Year financial forecast. This effort is also identifying capital purchases that will be
needed to continue its critical core public safety services, as well as other departmental needs.
Pension Benefits
The Village of Key Biscayne sponsors a defined contribution 401(a) pension plan with the International
City Managers' Association, Retirement Corporation (ICMA). Each full time employee can contribute up
to six percent (6%) of his or her pay to the plan; 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 pension 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 13 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, 2009. This was the eighteenth consecutive year
that the Village received this prestigious award. In order to be awarded a Certificate of Achievement,
the government published an easily readable and efficiently organized CAFR. This report satisfied both
GAAP and applicable legal requirements.
iii
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.
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. We would also like to express our appreciation to Marcum LLP, our independent auditors,
for their assistance and efforts in helping the Village prepare the CAFR. 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.
Resp tfully submitted,
Genaro "Chip" Iglesia
Village Manager
iv
v
VILLAGE OF KEY BISCAYNE, FLORIDA
VILLAGE OFFICIALS
SEPTEMBER 30, 2010
VILLAGE COUNCIL
Robert Vernon, Mayor
Enrique Garcia, Vice-Mayor
Michael Davey
Robert Gusman
Michael E. Kelly
Jorge E. Media
Thomas Thornton
VILLAGE MANAGER
Genaro “Chip” Iglesias
VILLAGE CLERK
Conchita H. Alvarez, MMC
VILLAGE ATTORNEY
Weiss Serota Helfman Pastoriza Cole & Boniske, P.A.
FINANCE DIRECTOR
Beatrice Galeano, P.A.
VILLAGE AUDITORS
Marcum LLP
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, 2009
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 retirernent
systems whose comprehensive annual financial
reports (CAFRs) achieve the highest
standards in government accounting
and financial reporting.
Executive Director
VOTERS OF
KEY BISCAYNE
Village
Council Local Planning
Agency
Village Clerk Special Master Village Manager Village Attorney
Police/Fire
Retirement
Board
Executive Asst
to the
Manager
Department of
Building,
Zoning and
Planning
Department of
Parks and
Recreation
Public Safety
Department
Department of
Public
Works
Department of
Finance and
Administrative
Services
Building
Zoning
Fire Rescue
Police
Special Events
Sports and
Athletics
Programs
Village Engineer
Contract
Supervisor
Stormwater
Finance/
Accounting
Personnel/
Benefits
RiskPlanning
Code Assistance
Programs
and Tours
Stormwater
Management
Refuse
Collection
and Recycling
Maintenance
Risk
Management
Senior
Coordinator
Maintenance
FINANCIAL SECTION
INDEPENDENT AUDITORS’ REPORT
1
INDEPENDENT AUDITORS’ REPORT
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, 2010 and for the fiscal 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 of America and the standards applicable to financial audits contained in Government
Auditing Standards, issued by the Comptroller General of the United States. Those standards
require that we plan and perform the audit to obtain reasonable assurance about whether the
financial statements are free of material misstatement. An audit includes consideration of
internal control over financial reporting as a basis for designing audit procedures that are
appropriate in the circumstances, but not for the purposes of expressing an opinion on the
effectiveness of the Village’s internal control over financial reporting. Accordingly, we express
no such opinion. An audit also includes examining, on a test basis, evidence supporting the
amounts and disclosures in the financial statements, assessing the accounting principles used and
significant estimates made by management, as well as evaluating the overall financial statement
presentation. We believe that our audit provides a reasonable basis for our opinions.
In our opinion, the financial statements referred to above present fairly, in all material respects,
the respective financial position of the governmental activities, the business-type activities, each
major fund and the aggregate remaining fund information of the Village of Key Biscayne, Florida
as of September 30, 2010 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 of America.
2
In accordance with Government Auditing Standards, we have also issued a report dated March
24, 2011 on our consideration of the Village's internal control over financial reporting and on our
tests of its compliance with certain provisions of laws, regulations, contracts and grant
agreements and other matters. The purpose of that report is to describe the scope of our testing
of internal control over financial reporting and compliance and the results of that testing, and not
to provide an opinion on the internal control over financial reporting or on compliance. That
report is an integral part of an audit performed in accordance with Government Auditing
Standards and should be considered in assessing the results of our audit.
Management’s Discussion and Analysis and the required supplementary information on pages 3
through 10 and pages 52 through 56, respectively, are not a required part of the basic financial
statements but are supplementary information required by accounting principles generally
accepted in the United States of America. 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 introductory
section and statistical tables are presented for purposes of additional analysis and are not a
required part of the basic financial statements. Similarly, the accompanying schedule of
expenditures of federal awards is presented for purposes of additional analysis as required by
OMB Circular A-133 and is not a required part of the basic financial statements. The schedule
of expenditures of federal awards 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 material respects,
in relation to the basic financial statements taken as a whole. The information included in the
introductory and statistical sections has not been subjected to the auditing procedures applied by
us in the audit of the basic financial statements and, accordingly, we express no opinion on them.
Miami, FL
March 24, 2011
MANAGEMENT’S DISCUSSION AND ANALYSIS
(MD&A)
3
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, 2010. We encourage readers to consider
information presented here in conjunction with additional information that we have furnished in our letter
of transmittal which can be found on pages i-v of this report.
Financial Highlights
The assets of the Village of Key Biscayne exceeded its liabilities at the close of the most recent fiscal
year by $75,714,823 (net assets).
The Village’s total net assets increased by $6,831,723. This is attributable to an increase in revenues
from the Key Biscayne Community Center programs and capital grants for construction.
At the close of the current fiscal year, the Village of Key Biscayne’s governmental funds reported an
ending fund balance of $19,182,814, an increase of $1,490,302 in comparison with the prior year. The
total amount of fund balance is either reserved or designated for spending at the Council’s direction.
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 required 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
general government, public works, police, fire, parks and recreation and building planning and zoning.
The government-wide financial statements include only the Village of Key Biscayne itself (known as the
primary government).
The government-wide financial statements can be found on pages 11 and 12 of this report.
4
Fund Financial Statements. A fund is a grouping of related accounts that is used to maintain control
over resources that have been segregated for specific activities or objectives. The 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 proprietary 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 spendable resources as well as on balances of spend able 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 government’s near-term financing
decisions. Both the governmental fund balance sheet and the governmental fund statement of revenues,
expenditures, and changes in fund balances provide a reconciliation to facilitate this comparison between
governmental funds and governmental activities.
The Village of Key Biscayne maintains three governmental funds, the general fund, a special revenue
fund and a capital projects fund.
The Village of Key Biscayne adopts an annual appropriated budget for its general fund. A budgetary
comparison schedule 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 16-18 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 proprietary funds.
The basic fiduciary fund financial statements can be found on pages 19-20 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 51 of this report.
Other Information
In addition to the basic financial statements and accompanying notes, this report also presents certain
required supplementary information including budgetary comparisons and the Village’s progress in
funding its obligation to provide pension benefits and other post-employment benefits to its employees.
5
Required supplementary information can be found on pages 52 to 56 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 of Key Biscayne, assets exceeded liabilities by $75,714,823 at the close of the
most recent fiscal year.
A portion of the Village’s assets, $97,291,562 or 81%, reflects its investment in capital assets (e.g., land
and equipment). The Village of Key Biscayne uses these capital assets to provide services to citizens;
consequently, these assets are not available for future spending.
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. A comparative analysis is provided.
Governmental Activities. Governmental activities increased the Village of Key Biscayne net assets by
approximately $4,071,945. This increase is attributable to the increase in revenues from the Key
Biscayne Community Center programs and increased licensing and permitting activities. All other
governmental activities increased net assets as follows:
Property taxes decreased by $1,937,102 (9.8%) during the year. This decrease is the product of a
substantial decline in the countywide taxable value of existing properties in Miami-Dade County.
Capital grants decreased due to the anticipated completion of the Sanitary Sewer Project.
Department salaries increased 5% due to the Village’s salary step program.
For the most part, increases in expenses closely paralleled inflation and growth in the scope of services.
Net Assets
A summary of the Village’s net assets is presented in Table A-1 and a summary of the changes in net
assets is presented in Table A-2.
2010 2009 2010 2009 2010 2009
Current assets 21,037,985$ 19,648,439$ 1,226,700$ 811,128$ 22,264,685$ 20,459,567$
Capital assets, net 71,465,039 70,628,369 25,826,523 22,606,106 97,291,562 93,234,475
Total assets 92,503,024 90,276,808 27,053,223 23,417,234 119,556,247 113,694,042
Current liabilities 4,423,980 4,542,106 729,229 1,599,476 5,153,209 6,141,582
Noncurrent liabilities 30,161,043 31,888,646 8,527,172 6,780,714 38,688,215 38,669,360
Total Liabilities 34,585,023 36,430,752 9,256,401 8,380,190 43,841,424 44,810,942
Investment in capital assets,
net of related debt 41,377,118 38,482,242 16,680,711 15,383,765 58,057,829 53,866,007
Restricted -- 308,813 -- -- -- 308,813
Unrestricted 16,540,883 15,055,000 1,116,111 (346,721) 17,656,994 14,708,279
Total Net Assets 57,918,001$ 53,846,055$ 17,796,822$ 15,037,044$ 75,714,823$ 68,883,099$
Governmental Activities Business-type Activities Total
Table A - 1
Summary of Net Assets
6
2010 2009 2010 2009 2010 2009
Revenues
Program revenues:
Charges for services 3,694,600$ 3,543,116$ 1,100,412$ 1,126,894$ 4,795,012$ 4,670,010$
Operating grants and contributions 163,752 157,912 -- -- 163,752 157,912
Capital grants and contributions 959,360 1,709,481 2,673,451 7,302,630 3,632,811 9,012,111
General revenues:
Property taxes 17,832,874 19,769,976 -- -- 17,832,874 19,769,976
Utility taxes 2,684,119 2,647,482 -- -- 2,684,119 2,647,482
Franchise fees 1,006,415 992,997 -- -- 1,006,415 992,997
Unrestricted intergovernmental revenue 1,391,242 1,348,324 -- -- 1,391,242 1,348,324
Investment income and miscellaneous 153,193 135,969 1,974 21,303 155,167 157,272
Total Revenues 27,885,555 30,305,257 3,775,837 8,450,827 31,661,392 38,756,084
Expenses
General government 2,751,697 2,868,728 -- -- 2,751,697 2,868,728
Public Safety 12,122,776 11,781,996 -- -- 12,122,776 11,781,996
Parks and Recreation 4,134,830 4,090,555 -- -- 4,134,830 4,090,555
Public Works 1,614,443 1,914,119 -- -- 1,614,443 1,914,119
Building, Zoning and Planning 1,611,119 1,540,507 -- -- 1,611,119 1,540,507
Interest on long-term debt 1,366,437 1,447,387 -- -- 1,366,437 1,447,387
Stormwater -- -- 603,262 779,856 603,262 779,856
Solid waste collection -- -- 585,927 618,155 585,927 618,155
Sanitary sewer construction -- -- 39,178 144,922 39,178 144,922
Total Expenses 23,601,302 23,643,292 1,228,367 1,542,933 24,829,669 25,186,225
Changes in net assets before transfers 4,284,253 6,661,965 2,547,470 6,907,894 6,831,723 13,569,859
Transfers (212,308) (164,502) 212,308 164,502 -- --
Changes in net assets after transfers 4,071,945 6,497,463 2,759,778 7,072,396 6,831,723 13,569,859
Net Assets - Beginning, as Restated 53,846,056 47,348,593 15,037,044 7,964,648 68,883,100 55,313,241
Net Assets - Ending 57,918,001$ 53,846,056$ 17,796,822$ 15,037,044$ 75,714,823$ 68,883,100$
Table A - 2
Summary of Changes in Net Assets
Governmental Activities Business-type Activities Total
The Village’s net assets increased by $6,831,723 during the current fiscal year. This increase is
attributable to $3,632,811 of capital contributions primarily for the Village’s sanitary sewer system and
Stormwater well rehabilitation projects.
Business-type Activities
Business-type activities increased the Village’s net assets by $2,759,778.
In fiscal 2010, all three business-type activities reflected profits.
The Stormwater Utility Fund reflected a net income of $54,294, due mainly to reduced operational
expenses.
The Solid Waste Collection Fund reported net income of $29,716, due to increased collection of old
debt and lowered operational costs.
The Sanitary Sewer Construction Fund construction activity is near completion. The net income of
$2,675,768 is a result of a capital grant.
7
Governmental Activities
Ad Valorem Taxes,
$17,832,874 , 64%
Franchise Fees,
$1,006,415 , 4%
Utility Taxes,
$2,684,119 , 10%
Intergovernmental,
$1,391,242 , 5%
Charges for Services,
$3,694,600 , 13%
Operating and
Capital Grants and
Contributions,
$1,123,112 , 4%
Investment Earnings,
$21,346 , 0%
Other, $131,847 , 0%
Revenues by Sources ‐Governmental Activities
8
Business-type Activities
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 spend able 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 $15,286,689, an increase of
$2,968,156 in comparison with the prior year. The increase was primarily caused by an increase in
revenues. All of this is reserved for specific uses: (1) emergencies ($4,000,001), (2) Building Inspection
Costs ($580,215), (3) Compensated Absences ($484,769), (4) Law Enforcement Seizures ($300,274), (5)
Fire Rescue Transport Fees ($449,134), (6) Working Capital Reserves ($3,826,016), (7) Prepaid Items
($309,253), (8) Labor Negotiations ($90,000), (9) Fire Grant Revenue - Urban Area Security Initiative
9
($42,920), (10) Capital Improvement Plan ($2,485,967), (11) Playing Field Acquisitions ($300,514), (12)
Police/Administration Building Reserve ($13,632), (13) Fire Station Building Reserve ($13,632), (14)
Community Center Equipment Reserve ($10,774), (15) Fire Vehicles Replacement Reserve ($50,000),
(16) Master Plan Initiatives ($1,864,222), (17) Capital Lease ($64,204), (18) Roadway Improvements
($175,000) and (19) Recreation Facilities ($226,162).
The general fund is the chief operating fund of the Village of Key Biscayne. As a measure of the general
fund’s liquidity, it may be useful to compare total fund balance to total fund expenditures. Total fund
balance represents 64% of total general fund expenditures.
A summary of the general fund’s condensed balance sheet and statement of revenues, expenditures and
changes in fund balance is presented in Table B-1 and B-2 for September 30, 2010 and 2009, is shown as
follows:
2010 2009
Total Assets 16,903,287$ 13,969,626$
Total Liabilities 1,616,598$ 1,651,093$
Reserved fund balance 15,286,689 12,318,533
Total Liabilities and Fund Balance 16,903,287$ 13,969,626$
2010 2009
Total Revenues 26,785,459$ 28,492,608$
Total Expenditures 23,817,303 27,472,253
Excess of Revenues over Expenditures 2,968,156$ 1,020,355$
Table B-1
Summary of Condensed Balance Sheet
Table B-2
Expenditures and Changes in Fund Balances
Summary of Condensed Statement of Revenues,
The Transportation Special Revenue Fund was established to account for the construction and future
maintenance of the Village’s roadways. County bridge toll revenues are the source of funding for
construction of roadways, while the local option gas tax funds maintenance and the transportation surtax
funds debt service.
At present, the fund shows a negative fund balance due to phase three of the Crandon Boulevard
Improvement Project. The majority of the negative fund balance will be eliminated in fiscal year 2011
with receipts from an existing FDOT grant.
The Capital Improvement Fund historically receives an annual budgeted transfer from the general fund
to fund capital construction of infrastructure throughout the island. Due to the downward trend of
revenues the ability to fund unlimited capital projects has decreased. At management’s recommendation
surplus funds generated by the general fund during the recent fiscal year were reserved as working capital
in order to mitigate future economic challenges.
General Fund Budgetary Highlights
There were three departments with significant budget to actual variances: Village Attorney, Fire and,
Parks and Recreation. These variances were cause by the following:
10
Attorney - excess code enforcement litigation in addition to negotiations with employee unions
Building, Planning & Zoning – payout of compensated absences
Parks and Recreation – additional field maintenance due the addition of sports lighting on Village
Green
Capital Assets
As of September 30, 2010, the Village’s capital assets net of accumulated depreciation amounted to
$97,291,562. Major capital asset events during the fiscal year included the following:
Enhancements to the Emergency Management Services within the Fire Rescue department
Resurfacing of Cape Florida and Harbor Drive
Re-sodding of the Village Green and St. Agnes Church playing fields
Installation of sports lighting on Village Green
Relocation of the Public Works yard
Continuation of the Beach Renourishment program
Continuation of the Sanitary Sewer Project
Additional information on the Village’s capital assets can be found in Note 7 on pages 34-35 of this
report.
Debt Administration
At September 30, 2010, the Village had bonded debt outstanding of $39,096,490. Of this amount,
$11,441,228 represents bonds secured solely by specified revenue sources (Transportation Tax Revenue
Bonds, Road Improvement Revenue Bonds and State Revolving Fund Loans). The remainder is special
obligation bonds that are secured by non-ad Valorem revenues through covenants to budget and appropriate.
Additional information on the Village’s long-term debt can be found in Note 8 on pages 35-42 of this
report.
Economic Factors and Next Year’s Budgets and Rates
Taxable values declined steeply for the third straight year across Miami-Dade County. Property values
fell 13.4 percent compared to last year. Taxable property values in Miami-Dade County stemming from
new construction reached $2.6 billion, down from $8.4 billion the year before. The Village of Key
Biscayne continues to manage a budget that is responsive to the needs of its community while lowering
operating expenditures and continuing to seeking cost-cutting measures. Additionally, prior year
surpluses have been reserved as working capital to offset any future loss of revenue.
The unemployment rate for Miami-Dade County is currently 13.20%, which is an increase from a rate of
11.50% percent a year ago. This is unfavorable to the state’s average unemployment rate of 12% as well
as the national average rate of 9.6%.
All of these factors were considered during preparation of the Village of Key Biscayne’s budget for the
2011 fiscal year.
Requests for Information
This financial report is designed to provide a general overview of the Village of Key Biscayne’s finances
for all those with an interest in the government’s finances. Questions concerning any of the information
provided in this report or requests for additional financial information should be addressed to the Office of
the Village Manager, 88 West McIntyre Street, Key Biscayne, Florida 33149.
BASIC FINANCIAL STATEMENTS
Business-
Governmental type
Activities Activities Total
Assets
Cash and cash equivalents 17,670,696$ 1,184,371$ 18,855,067$
Receivables, net 962,846 693,700 1,656,546
Due from other governments 1,000,000 -- 1,000,000
Prepaids 309,253 -- 309,253
Internal balances 651,371 (651,371) --
Negative net pension obligation 111,389 -- 111,389
Other assets 18,001 -- 18,001
Restricted assets:
Cash and cash equivalents 14,155 -- 14,155
Investments 300,274 -- 300,274
Capital assets not being depreciated 35,767,838 19,322,430 55,090,268
Capital assets being depreciated, net 35,697,201 6,504,093 42,201,294
Total Assets 92,503,024 27,053,223 119,556,247
Liabilities
Accounts payable and accrued liabilities 814,710 110,589 925,299
Accrued interest payable 301,574 -- 301,574
Unearned revenue 836,481 -- 836,481
Noncurrent liabilities:
Due within one year 2,350,723 618,640 2,969,363
Due in more than one year 30,161,043 8,527,172 38,688,215
Net OPEB obligation 120,492 -- 120,492
Total Liabilities 34,585,023 9,256,401 43,841,424
Net Assets
Invested in capital assets, net of related debt 41,377,118 16,680,711 58,057,829
Unrestricted 16,540,883 1,116,111 17,656,994
Total Net Assets 57,918,001$ 17,796,822$ 75,714,823$
VILLAGE OF KEY BISCAYNE, FLORIDA
STATEMENT OF NET ASSETS
SEPTEMBER 30, 2010
The accompanying notes are an integral part of these financial statements.
11
Charges Operating Capital Business-
for Grants and Grants and Governmental type
Functions/Programs Expenses Services Contributions Contributions Activities Activities Total
Governmental activities
General government 2,751,697$ 181,992$ --$ --$ (2,569,705)$ --$ (2,569,705)$
Police 5,360,548 (1,479) -- (5,362,027) -- (5,362,027)
Fire 6,762,228 158,975 38,709 -- (6,564,544) -- (6,564,544)
Public works 1,614,443 -- 114,889 959,360 (540,194) -- (540,194)
Building, zoning and planning 1,611,119 1,247,715 -- -- (363,404) -- (363,404)
Parks and recreation 4,134,830 2,107,397 10,154 -- (2,017,279) -- (2,017,279)
Interest on long-term debt 1,366,437 -- -- -- (1,366,437) -- (1,366,437)
Total governmental activities 23,601,302 3,694,600 163,752 959,360 (18,783,590) -- (18,783,590)
Business-type activities
Stormwater 603,262 484,932 -- 172,164 -- 53,834 53,834
Sanitary sewer 39,178 -- -- 2,501,287 -- 2,462,109 2,462,109
Solid waste 585,927 615,480 -- -- -- 29,553 29,553
Total business-type activities 1,228,367 1,100,412 -- 2,673,451 -- 2,545,496 2,545,496
Total 24,829,669$ 4,795,012$ 163,752$ 3,632,811$ (18,783,590) 2,545,496 (16,238,094)
General Revenues
Property taxes 17,832,874 -- 17,832,874
Franchise fees based on gross receipts 1,006,415 -- 1,006,415
Utility taxes 1,655,032 -- 1,655,032
Communications services tax 1,029,087 -- 1,029,087
Unrestricted intergovernmental revenue 1,391,242 -- 1,391,242
Unrestricted investment earnings 21,346 1,974 23,320
Miscellaneous income 131,847 -- 131,847
Transfers (212,308) 212,308 --
Total General Revenues 22,855,535 214,282 23,069,817
Change in Net Assets 4,071,945 2,759,778 6,831,723
Net Assets - Beginning 53,846,056 15,037,044 68,883,100
Net Assets - Ending 57,918,001$ 17,796,822$ 75,714,823$
Changes in Net AssetsProgram Revenues
VILLAGE OF KEY BISCAYNE, FLORIDA
STATEMENT OF ACTIVITIES
FISCAL YEAR ENDED SEPTEMBER 30, 2010
Net (Expense) Revenue and
The accompanying notes are an integral part of these financial statements.
12
Transportation Total
Special Capital Governmental
General Revenue Improvements Funds
Assets
Cash and cash equivalents 12,521,433$ --$ 5,149,263$ 17,670,696$
Receivables, net 714,215 93,154 155,477 962,846
Due from other governments -- 1,000,000 -- 1,000,000
Due from other funds 3,058,112 -- 112,831 3,170,943
Prepaid items 309,253 -- -- 309,253
Restricted cash and cash equivalents -- 14,155 -- 14,155
Restricted investments 300,274 -- -- 300,274
Total Assets 16,903,287$ 1,107,309$ 5,417,571$ 23,428,167$
Liabilities and Fund Balances
Liabilities
Accounts payable and accrued liabilities 592,696$ --$ 222,014$ 814,710$
Due to other funds 112,831 2,406,741 -- 2,519,572
Deferred revenue 911,071 -- -- 911,071
Total Liabilities 1,616,598 2,406,741 222,014 4,245,353
Fund Balances
Reserved (Note 11)15,286,689 -- -- 15,286,689
Unreserved, undesignated reported in:
Special revenue fund (deficit)-- (1,299,432) -- (1,299,432)
Capital improvements -- -- 5,195,557 5,195,557
Total Fund Balances (Deficit)15,286,689 (1,299,432) 5,195,557 19,182,814
Total Liabilities and Fund Balances 16,903,287$ 1,107,309$ 5,417,571$
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 71,465,039
A negative net pension obligation (NPO) is not considered to represent a financial
asset and therefore is not reported in the governmental funds 111,389
Long-term receivables are not available to pay for current period
expenditures and, therefore, are not reported in the funds 74,590
Long-term liabilities, including bonds payable, are not due and payable in the current
period and therefore not reported in the funds (32,915,831)
Net Assets of Governmental Activities 57,918,001$
VILLAGE OF KEY BISCAYNE, FLORIDA
BALANCE SHEET
GOVERNMENTAL FUNDS
SEPTEMBER 30, 2010
The accompanying notes are an integral part of these financial statements.
13
Transportation Total
Special Capital Governmental
General Revenue Improvements Funds
Revenues
Property taxes 17,832,874$ --$ --$ 17,832,874$
Utility taxes 1,655,032 -- -- 1,655,032
Communications services tax 1,076,734 -- -- 1,076,734
Franchise fees 1,006,415 -- -- 1,006,415
Licenses and permits 1,329,823 -- -- 1,329,823
Intergovernmental 1,203,221 885,794 -- 2,089,015
Charges for services 2,364,777 -- -- 2,364,777
Interest 20,983 261 102 21,346
Grants 163,752 -- 261,587 425,339
Miscellaneous income 131,848 -- -- 131,848
Total Revenues 26,785,459 886,055 261,689 27,933,203
Expenditures
Current:
General government 1,934,341 -- -- 1,934,341
Fire 6,584,784 -- -- 6,584,784
Police 5,093,601 -- -- 5,093,601
Public works 1,608,193 -- -- 1,608,193
Building, zoning and planning 1,602,651 -- -- 1,602,651
Parks and recreation 3,717,935 -- 3,717,935
Capital outlay 408,442 -- 1,941,493 2,349,935
Debt service:
Principal 1,721,460 419,224 -- 2,140,684
Interest and fiscal charges 1,122,032 264,881 -- 1,386,913
Total Expenditures 23,793,439 684,105 1,941,493 26,419,037
Excess (deficiency) of revenues
over expenditures 2,992,020 201,950 (1,679,804) 1,514,166
Other Financing Sources (Uses)
Capital Lease 188,444 -- -- 188,444
Transfers out (212,308) -- -- (212,308)
Total Other Financing Sources (Uses)(23,864) -- -- (23,864)
Net Change in Fund Balances 2,968,156 201,950 (1,679,804) 1,490,302
Fund Balances (Deficit) - Beginning 12,318,533 (1,501,382) 6,875,361 17,692,512
Fund Balances (Deficit) - Ending 15,286,689$ (1,299,432)$ 5,195,557$ 19,182,814$
VILLAGE OF KEY BISCAYNE, FLORIDA
STATEMENT OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCES
GOVERNMENTAL FUNDS
FISCAL YEAR ENDED SEPTEMBER 30, 2010
The accompanying notes are an integral part of these financial statements.
14
Amounts reported for governmental activities in the statement of activities
(Page 12) are different because:
Net change in fund balances - total governmental funds (Page 14) 1,490,302$
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:
Cost of assets 2,358,407$
Depreciation expense (1,508,339)
Net effect of miscellaneous transactions related to capital assets (4,926)
Net adjustment 845,142
Under the modified accrual basis of accounting used in the governmental funds,
revenues are not recognized until funds are measurable and available to
finance current expenditures. In the statement of activities, however, which
is presented on the accrual basis, revenues are reported when earned.
The detail of the difference is as follows:
Communications services tax proceeds (47,646)
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 2,089,482
Capital lease payments 157,167
Capital lease proceeds (188,444) 2,058,205
Some expenses reported in the statement of activities do not require current
financial resources and, therefore, are not reported as expenditures in
governmental funds.
The details of the difference is:
Compensated absences (169,090)
Accrued interest expense 21,860
Debt issuance costs (1,384)
Net OPEB obligation (120,492)
Negative net pension obligation (4,952) (274,058)
Change in net assets of governmental activities (Page 12) 4,071,945$
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, 2010
The accompanying notes are an integral part of these financial statements.
15
Stormwater Sanitary
Utility Sewer Solid
System Construction Waste Totals
Assets
Current Assets
Cash and cash equivalents 184,652$ 908,978$ 90,741$ 1,184,371$
Accounts receivables, net 166,434 322,320 204,946 693,700
Total Current Assets 351,086 1,231,298 295,687 1,878,071
Noncurrent Assets
Capital assets not being depreciated 558,731 18,763,699 -- 19,322,430
Capital assets being depreciated, net 6,504,093 -- -- 6,504,093
Total Noncurrent Assets 7,062,824 18,763,699 -- 25,826,523
Total Assets 7,413,910 19,994,997 295,687 27,704,594
Liabilities
Current Liabilities
Accounts payable and accrued liabilities 37,722 28,651 44,216 110,589
Due to other funds 650,872 -- 499 651,371
Current portion of revolving loans -- 213,640 -- 213,640
Current portion of revenue bonds payable 405,000 -- -- 405,000
Total Current Liabilities 1,093,594 242,291 44,715 1,380,600
Noncurrent Liabilities
Revenue bonds 4,045,000 -- -- 4,045,000
Revolving loans -- 4,482,172 -- 4,482,172
Total Noncurrent Liabilities 4,045,000 4,482,172 -- 8,527,172
Total Liabilities 5,138,594 4,724,463 44,715 9,907,772
Net Assets
Invested in capital assets, net of related debt 2,612,824 14,067,887 -- 16,680,711
Unrestricted (deficit) (337,508) 1,202,647 250,972 1,116,111
Total Net Assets 2,275,316$ 15,270,534$ 250,972$ 17,796,822$
Business-type Activities -
Enterprise Funds
VILLAGE OF KEY BISCAYNE, FLORIDA
STATEMENT OF NET ASSETS
PROPRIETARY FUNDS
SEPTEMBER 30, 2010
The accompanying notes are an integral part of these financial statements.
16
Stormwater Sanitary
Utility Sewer Solid
System Construction Waste Totals
Operating Revenues
Charges for services 484,932$ --$ 615,480$ 1,100,412$
Operating Expenses
General and administrative 129,781 -- 583,248 713,029
Depreciation 273,919 -- -- 273,919
Total Operating Expenses 403,700 -- 583,248 986,948
Operating Income 81,232 -- 32,232 113,464
Non-Operating Revenues (Expenses)
Interest income 460 1,351 163 1,974
Other expense -- -- (2,679) (2,679)
Interest expense (199,562) (39,178) -- (238,740)
Total Non-Operating
Revenues (Expenses)(199,102) (37,827) (2,516) (239,445)
Income (Loss) before Contributions
and Transfers (117,870) (37,827) 29,716 (125,981)
Capital contributions 172,164 2,501,287 -- 2,673,451
Transfers in -- 212,308 -- 212,308
Total Contributions and Transfers 172,164 2,713,595 -- 2,885,759
Change in Net Assets 54,294 2,675,768 29,716 2,759,778
Net Assets - Beginning 2,221,022 12,594,766 221,256 15,037,044
Net Assets - Ending 2,275,316$ 15,270,534$ 250,972$ 17,796,822$
Business-type Activities -
Enterprise Funds
VILLAGE OF KEY BISCAYNE, FLORIDA
STATEMENT OF REVENUES, EXPENSES AND CHANGES IN NET ASSETS
PROPRIETARY FUNDS
FISCAL YEAR ENDED SEPTEMBER 30, 2010
The accompanying notes are an integral part of these financial statements.
17
Stormwater Sanitary
Utility Sewer Solid
System Construction Waste Totals
Cash Flows from Operating Activities
Receipts from customers and users 412,840$ --$ 867,608$ 1,280,448$
Receipts from interfund services provided 739,616 -- -- 739,616
Payments to suppliers (106,743) -- (640,536) (747,279)
Payments for interfund services -- -- (798,137) (798,137)
Net Cash Provided by (Used in) Operating Activities 1,045,713 -- (571,065) 474,648
Cash Flows from Non-Capital Financing Activities
Transfers from other funds -- 212,308 -- 212,308
Net Cash Provided by Non-Capital
Financing Activities -- 212,308 -- 212,308
Cash Flows from Capital and Related Financing Activities
Capital contributions 172,164 2,335,477 -- 2,507,641
Proceeds from revolving loan -- 2,328,051 -- 2,328,051
Payments for construction of capital assets (558,731) (4,717,842) -- (5,276,573)
Payments on revenue bonds (385,000) -- -- (385,000)
Payments on revolving loans -- (19,580) -- (19,580)
Interest paid (199,562) (39,178) -- (238,740)
Net Cash Used by Capital
and Related Financing Activities (971,129) (113,072) -- (1,084,201)
Cash Flows from Investing Activities
Interest received 460 1,351 (2,516) (705)
Net Cash Provided by (Used in) Investing Activities 460 1,351 (2,516) (705)
Net Increase (Decrease) in Cash and Cash Equivalents 75,044 100,587 (573,581) (397,950)
Cash and Cash Equivalents - Beginning 109,608 808,391 664,322 1,582,321
Cash and Cash Equivalents - Ending 184,652$ 908,978$ 90,741$ 1,184,371$
Reconciliation of Operating Income to Net Cash
Provided by (Used in) Operating Activities
Operating income 81,232$ --$ 32,232$ 113,464$
Adjustments to reconcile operating income to net
cash provided by operating activities:
Depreciation 273,919 -- -- 273,919
Changes in operating assets and liabilities:
Increase (decrease) in:
Accounts receivable (72,092) -- 250,880 178,788
Due from other funds 88,744 -- -- 88,744
Increase (decrease) in:
Accounts payable and accrued liabilities 23,038 -- (57,288) (34,250)
Deferred revenue -- -- 749 749
Due to other funds 650,872 -- (797,638) (146,766)
Total adjustments 964,481 -- (603,297) 361,184
Net Cash Provided by (Used in) Operating Activities 1,045,713$ --$ (571,065)$ 474,648$
Business-type Activities -
Enterprise Funds
VILLAGE OF KEY BISCAYNE, FLORIDA
STATEMENT OF CASH FLOWS
PROPRIETARY FUNDS
FISCAL YEAR ENDED SEPTEMBER 30, 2010
The accompanying notes are an integral part of these financial statements.
18
Assets
Investments
Money market funds 292,257$
Common stocks 3,106,207
Mutual funds 10,480,892
Total Investments 13,879,356
Contributions Receivable
Village (including State) 109,330
Total Assets 13,988,686
Liabilities --
Net Assets
Net Assets Held in Trust for Pension Benefits 13,988,686$
VILLAGE OF KEY BISCAYNE, FLORIDA
STATEMENT OF FIDUCIARY NET ASSETS
PENSION TRUST FUND
SEPTEMBER 30, 2010
The accompanying notes are an integral part of these financial statements.
19
NOTES TO BASIC FINANCIAL STATEMENTS
VILLAGE OF KEY BISCAYNE, FLORIDA
NOTES TO BASIC FINANCIAL STATEMENTS
FISCAL YEAR ENDED SEPTEMBER 30, 2010
21
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 of America (GAAP) as applied to
governmental units. The Governmental Accounting Standards Board (GASB) is the
accepted standard-setting body for establishing governmental accounting and financial
reporting principles. The more significant of the Village’s accounting policies are
described below:
A. FINANCIAL REPORTING ENTITY
The financial statements were prepared in accordance with GASB Statements related to 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.
NOTE 1 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
VILLAGE OF KEY BISCAYNE, FLORIDA
NOTES TO BASIC FINANCIAL STATEMENTS
FISCAL YEAR ENDED SEPTEMBER 30, 2010
22
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, proprietary funds, and
fiduciary funds, even though the latter are excluded from the government-wide financial
statements. Major individual governmental funds and major individual enterprise funds are
reported as separate columns in the fund financial statements.
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 timing of related cash flows.
Property taxes are recognized as revenues in the year for which they are levied. Grants and
similar items are recognized as revenue as soon as all eligibility requirements imposed by
the provider have been met.
Governmental fund financial statements are reported using the current financial resources
measurement focus and the modified accrual basis of accounting. Revenues are recognized
as soon as they are both measurable and available. Revenues are considered to be available
when they are collectible within the current period or soon enough thereafter to pay
liabilities of the current period. For this purpose, the Village considers revenues to be
available if they are collected within 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.
NOTE 1 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
VILLAGE OF KEY BISCAYNE, FLORIDA
NOTES TO BASIC FINANCIAL STATEMENTS
FISCAL YEAR ENDED SEPTEMBER 30, 2010
23
C. MEASUREMENT FOCUS, BASIS OF ACCOUNTING, AND FINANCIAL STATEMENT
PRESENTATION (CONTINUED)
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. Revenues for expenditure driven grants
are recognized when the qualifying expenditures are incurred. All other revenue items are
considered to be measurable and available only when cash is received by the Village.
The Village reports the following major governmental funds:
The General Fund is the Village’s primary operating fund. It accounts for all financial
resources of the general government, except those required to be accounted for in
another fund.
The Transportation Special Revenue Fund accounts for the revenues received from the
transportation surtax and expenditures for related transportation costs.
The Capital Improvement Fund accounts for the acquisition or construction of various
major capital projects.
The Village reports the following major proprietary funds in the basic financial statements:
The Stormwater Utility Fund accounts for the construction and maintenance of the
Village’s stormwater system.
The Sanitary Sewer Fund accounts for the development and construction of a municipal
sanitary sewer system to the unsewered areas of the community.
The Solid Waste Fund accounts for the provision of solid waste disposal services to
Village residents and businesses.
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.
VILLAGE OF KEY BISCAYNE, FLORIDA
NOTES TO BASIC FINANCIAL STATEMENTS
FISCAL YEAR ENDED SEPTEMBER 30, 2010
24
NOTE 1 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
C. MEASUREMENT FOCUS, BASIS OF ACCOUNTING, AND FINANCIAL STATEMENT
PRESENTATION (CONTINUED)
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.
Elimination of these charges would distort the direct costs and program revenues reported
for the various functions concerned.
Amounts reported as program revenues include 1) charges to customers or applicants for
goods, services, or privileges provided, 2) operating grants and contributions, and 3) capital
grants and contributions. 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 nonoperating items.
Operating revenues and expenses generally result from providing services and producing
and delivering goods in connection with a proprietary fund’s principal ongoing operations.
The principal operating revenues of the 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.
When both restricted and unrestricted resources are available for use, it is the Village’s
policy to use restricted resources first, then unrestricted resources as they are needed.
VILLAGE OF KEY BISCAYNE, FLORIDA
NOTES TO BASIC FINANCIAL STATEMENTS
FISCAL YEAR ENDED SEPTEMBER 30, 2010
25
NOTE 1 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
D. ASSETS, LIABILITIES, AND NET ASSETS OR EQUITY
1. Deposits and Investments
The Village’s cash and cash equivalents include cash on hand, certificates of deposit
with original maturities of three months or less from the date of acquisition and a
repurchase agreement. All other investments, including pension investments, are
recorded at fair value. Fair value is determined by quoted market prices.
2. Interfund Receivables and Payables
Activities 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”.
3. Receivables
Receivables include amounts due from other governments and others for services
provided by the Village. Receivables are recorded and revenues are recognized as
earned or as specific program expenditures/expenses are incurred. Allowances, if any,
for uncollectible receivables are based upon historical trends and the periodic aging of
receivables.
4. Capital Assets
Capital assets, which include property, plant and equipment, and 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. Tangible and intangible 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. All infrastructure assets have been capitalized
since inception of the Village.
VILLAGE OF KEY BISCAYNE, FLORIDA
NOTES TO BASIC FINANCIAL STATEMENTS
FISCAL YEAR ENDED SEPTEMBER 30, 2010
26
NOTE 1 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
D. ASSETS, LIABILITIES, AND NET ASSETS OR EQUITY (CONTINUED)
The costs of normal maintenance and repairs that do not add to the value of the asset or
materially extend asset 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. During the year ended September 30, 2010,
total interest expense incurred by business-type activities was $302,395. Of this
amount, $63,655 was included as part of the cost of capital assets under construction in
connection with the sanitary sewer project.
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
Furniture, fixtures and equipment 10
Stormwater utility system 50
During the fiscal year ended September 30, 2010, the Village implemented GASB
Statement No. 51, Accounting and Financial Reporting for Intangible Assets. There
was an immaterial effect on the Village’s financial statements. Intangible assets consist
of computer software, which was capitalized as an asset n prior years, and rights of
way. The Village elected not to retroactively report all intangible assets.
5. Unearned/Deferred Revenue
Inflows that do not yet meet the criteria for revenue recognition are recorded as
unearned revenue in the government-wide statements and as deferred revenue in the
fund financial statements. Unearned/deferred revenue consists primarily of
occupational licenses and community center membership dues.
6. 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
NOTE 1 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
VILLAGE OF KEY BISCAYNE, FLORIDA
NOTES TO BASIC FINANCIAL STATEMENTS
FISCAL YEAR ENDED SEPTEMBER 30, 2010
27
D. ASSETS, LIABILITIES, AND NET ASSETS OR EQUITY (CONTINUED)
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 that occurred prior to September 30, 2010 and were subsequently
paid with current available financial resources. The general fund typically is used to
liquidate the liability for compensated absences.
7. 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.
8. Use of Estimates
The preparation of financial statements in conformity with accounting principles
generally accepted in the United States of America 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
collectability 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 may undertake in the future,
they may ultimately differ from actual results.
VILLAGE OF KEY BISCAYNE, FLORIDA
NOTES TO BASIC FINANCIAL STATEMENTS
FISCAL YEAR ENDED SEPTEMBER 30, 2010
28
NOTE 1 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
D. ASSETS, LIABILITIES, AND NET ASSETS OR EQUITY (CONTINUED)
9. 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.
10. Net Assets
Net assets of the government-wide and proprietary funds are categorized as invested in
capital assets, net of related debt; restricted or unrestricted. Invested in capital assets,
net of related debt, is that portion of net assets that relates to the Village’s capital assets
reduced by accumulated depreciation and by any outstanding debt incurred to acquire,
construct or improve those assets, excluding unexpended proceeds.
Restricted net assets is that portion of net assets that has been restricted for general use
by external parties (creditors, grantors, contributors, or laws or regulations of other
governments) or imposed by law through constitutional provisions or enabling
legislation. Unrestricted net assets consist of all net assets that do not meet the
definition of either of the other two components.
NOTE 2 – EXPLANATION OF CERTAIN DIFFERENCES BETWEEN THE GOVERNMENTAL FUND
BALANCE SHEET AND THE GOVERNMENT-WIDE STATEMENT OF NET ASSETS
The governmental fund balance sheet includes a reconciliation between fund balance – total
governmental funds and net assets – governmental activities as reported in the government-
wide statement of net assets. One element of that reconciliation explains that long-term
liabilities, including bonds payable, are not due and payable in the current period and
therefore are not reported in the funds. The details of this $32,915,831 difference is as
follows:
VILLAGE OF KEY BISCAYNE, FLORIDA
NOTES TO BASIC FINANCIAL STATEMENTS
FISCAL YEAR ENDED SEPTEMBER 30, 2010
29
Bonds Payable 29,950,678$
Debt Issuance Costs (18,001)
Capital Leases Payable 137,243
Compensated Absences 2,423,845
Accrued Interest Payable 301,574
Net OPEB Obligation 120,492
32,915,831$
NOTE 3 – DEPOSITS AND INVESTMENTS
DEPOSITS
In addition to insurance provided by the Federal Depository Insurance Corporation, all
deposits are held in banking institutions approved by the State Treasurer of the State of
Florida to hold public funds. Under Florida Statutes Chapter 280, Florida Security for
Public Deposits Act, the State Treasurer requires all Florida qualified public depositories to
deposit with the Treasurer or another banking institution eligible collateral. In the event of
a failure of a qualified public depository, the remaining public depositories would be
responsible for covering any resulting losses. Accordingly, all amounts reported as
deposits are deemed as insured or collateralized.
INVESTMENTS
The Village is authorized to invest in obligations of the U.S. Treasury, its agencies,
instrumentalities and the Florida PRIME (formerly known as the Local Government
Surplus Funds Trust Fund (LGIP)) administered by the State Board of Administration. The
investments follow the investment rules defined in Florida Statutes Chapter 218.415. 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.
INVESTMENTS – VILLAGE
As of September 30, 2010, the Village had the following investments with its
corresponding maturities in its portfolio:
Fair Less
Investments Value Than 1
Repurchase Agreements 5,821,843$ 5,821,843$
(In Years)
Investment Maturities
VILLAGE OF KEY BISCAYNE, FLORIDA
NOTES TO BASIC FINANCIAL STATEMENTS
FISCAL YEAR ENDED SEPTEMBER 30, 2010
30
Interest Rate Risk
Interest rate risk refers to the portfolio's exposure to fair value losses arising from
increasing interest rates. The Village does not have a formal investment policy that limits
investment maturities as a means of managing its exposure to market value losses arising
from increasing interest rates.
VILLAGE OF KEY BISCAYNE, FLORIDA
NOTES TO BASIC FINANCIAL STATEMENTS
FISCAL YEAR ENDED SEPTEMBER 30, 2010
31
NOTE 3 – DEPOSITS AND INVESTMENTS (CONTINUED)
INVESTMENTS – VILLAGE (CONTINUED)
Custodial Credit Risk
For an investment, custodial credit risk is the risk that, in the event of the failure of the
counterparty, the Village will not be able to recover the value of its investments or
collateral securities that are in the possession of an outside party. The Village’s $5.8
million investment in repurchase agreements is held by the investment’s counterparty, not
in the name of the Village. The Village’s investment policy does not have a limit on
holding of securities by counterparties.
INVESTMENTS – PENSION PLAN
As of September 30, 2010, the Village’s Defined Benefit Pension Plan had the following
investments with its corresponding maturities in its portfolio:
Fair Less
Investments Value Than 1 1-5 6-10 10+
Bond Mutual Funds 5,199,584$ 1,157,852$ 1,909,473$ 1,377,624$ 754,635$
Investment Maturities (In Years)
Interest Rate Risk
Interest rate risk refers to the portfolio's exposure to fair value losses arising from
increasing interest rates. The Plan does not have a formal investment policy that limits
investment maturities as a means of managing its exposure to market value losses arising
from increasing interest rates.
Credit Risk
State law and the Plan’s investment policy limits investments in bonds, stocks, or other
evidences of indebtedness issued or guaranteed by a corporation organized under the laws
of the United States, any state or organized territory of the United States, or the District of
Columbia, provided the corporation is listed on any one or more of the recognized national
stock exchanges or on the National Market System of the NASDAQ Stock Market and in
the case of bonds only, holds a rating in one of the three highest classifications by a major
rating service. The Plan’s investment policy limits fixed income securities to a rating no
lower than Standard & Poor's BBB or Moody’s BAA.
The Plan's bond mutual funds were all rated "A" or better under Standard & Poor's ratings.
VILLAGE OF KEY BISCAYNE, FLORIDA
NOTES TO BASIC FINANCIAL STATEMENTS
FISCAL YEAR ENDED SEPTEMBER 30, 2010
32
NOTE 3 – DEPOSITS AND INVESTMENTS (CONTINUED)
INVESTMENTS – PENSION PLAN (CONTINUED)
Concentration of Credit Risk
The Plan's investment policy prohibits equity and fixed income securities concentrations
greater than 5% and 10%, respectively, in any one issuer with the exception of U.S.
government or agency issues. As of September 30, 2010, the value of each position held in
the Plan’s portfolio comprised less than 5% of Plan investment assets.
RISKS AND UNCERTAINTIES
The Village and the Plan invest in various investment securities. Investment securities are
exposed to various risks such as interest rate, market, and credit risks. Due to the level of
risk associated with certain investment securities, it is at least reasonably possible that
changes in the values of investment securities will occur in the near term and that such
changes could materially affect the amounts reported in the financial statements. The
Village and the Plan, through its investment advisor, monitors the investments and the risks
associated therewith on a regular basis which the Village and the Plan believes minimizes
these risks.
Plan contributions are made and the actuarial present value of accumulated plan benefits are
reported based on certain assumptions pertaining to interest rates, inflation rates and
employee demographics, all of which are subject to change. Due to uncertainties inherent
in the estimations and assumptions process, it is at least reasonably possible that changes in
these estimates and assumptions in the near term would be material to the financial
statements.
VILLAGE OF KEY BISCAYNE, FLORIDA
NOTES TO BASIC FINANCIAL STATEMENTS
FISCAL YEAR ENDED SEPTEMBER 30, 2010
33
NOTE 4 – RECEIVABLES
Receivables as of September 30, 2010 for the Village’s individual major funds, non-major
funds and fiduciary fund in the aggregate, including the allowances for uncollectible
accounts, are as follows:
Special Capital Storm- Sanitary Solid Pension
General Revenue Improvements water Sewer Waste Trust Fund Total
Customers Billed --$ --$ --$ 94,819$ --$ 226,585$ --$ 321,404$
Contributions -- -- -- -- -- -- 109,330 109,330
Property Taxes 197,199 -- -- -- -- -- -- 197,199
Intergovernmental 334,483 93,154 155,477 71,615 322,320 -- -- 977,049
Other 182,533 -- -- -- -- -- -- 182,533
Due from Other Governments -- 1,000,000 -- -- -- -- -- 1,000,000
Gross Receivables 714,215 1,093,154 155,477 166,434 322,320 226,585 109,330 2,787,515
Less Allowance for
Uncollectibles -- -- -- -- -- (21,639) -- (21,639)
Net Total Receivables 714,215$ 1,093,154$ 155,477$ 166,434$ 322,320$ 204,946$ 109,330$ 2,765,876$
NOTE 5 – 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. The millage rate assessed by the Village
for the year ended September 30, 2010 was 3.200.
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, 2010, there were no material delinquent taxes.
VILLAGE OF KEY BISCAYNE, FLORIDA
NOTES TO BASIC FINANCIAL STATEMENTS
FISCAL YEAR ENDED SEPTEMBER 30, 2010
34
NOTE 6 – INTERFUND RECEIVABLES, PAYABLES AND TRANSFERS
The composition of interfund balances as of September 30, 2010 is as follows:
Due from/to other funds:
Receivable Fund Payable Fund Amount
General Special Revenue 2,406,741$
Stormwater 650,872
Solid Waste 499
Capital Improvement General 112,831
3,170,943$
The outstanding balances between funds result mainly from the time lag between the dates
that (1) interfund goods and services are provided or reimbursable expenditures occur, (2)
transactions are recorded in the accounting system, and (3) payments between funds are
made.
Interfund transfers:
Transfers In
Sanitary
Sewer
Transfers Out
General fund 212,308$
Transfers are used to move unrestricted general fund revenues to finance various capital
projects in accordance with budgetary authorizations.
VILLAGE OF KEY BISCAYNE, FLORIDA
NOTES TO BASIC FINANCIAL STATEMENTS
FISCAL YEAR ENDED SEPTEMBER 30, 2010
35
NOTE 7 – CAPITAL ASSETS
Capital asset activity for the year ended September 30, 2010 was as follows:
Beginning Ending
Balance Increases Decreases Balance
Governmental Activities
Capital Assets, Not Being Depreciated
Land 21,833,837$ --$ --$ 21,833,837$
Construction in progress 13,276,260 657,741 -- 13,934,001
Total Capital Assets, Not Being Depreciated 35,110,097 657,741 -- 35,767,838
Capital Assets, Being Depreciated
Buildings 24,566,802 24,180 -- 24,590,982
Improvements other than buildings 16,462,264 775,402 -- 17,237,666
Furniture, fixtures and equipment 5,911,503 892,612 (44,616) 6,759,499
Total Capital Assets, Being Depreciated 46,940,569 1,692,194 (44,616) 48,588,147
Less Accumulated Depreciation for
Buildings (3,393,617) (496,959) -- (3,890,576)
Improvements other than buildings (4,026,946) (401,305) -- (4,428,251)
Furniture, fixtures and equipment (4,001,734) (610,074) 39,690 (4,572,118)
Total Accumulated Depreciation (11,422,297) (1,508,339) 39,690 (12,890,946)
Total Capital Assets, Being Depreciated, Net 35,518,272 183,855 (4,926) 35,697,201
Governmental Activities Capital Assets, Net 70,628,369$ 841,596$ (4,926)$ 71,465,039$
Business-type Activities
Capital Assets, Not Being Depreciated
Construction in progress 15,828,094$ 3,494,336$ --$ 19,322,430$
Total Capital Assets, Not Being Depreciated 15,828,094 3,494,336 -- 19,322,430
Capital Assets, Being Depreciated
Stormwater utility system 10,056,660 -- -- 10,056,660
Total Capital Assets, Being Depreciated 10,056,660 -- -- 10,056,660
Less Accumulated Depreciation for
Stormwater utility system (3,278,648) (273,919) -- (3,552,567)
Total Accumulated Depreciation (3,278,648) (273,919) -- (3,552,567)
Total Capital Assets, Being Depreciated, Net 6,778,012 (273,919) -- 6,504,093
Business-type Activities Capital Assets, Net 22,606,106$ 3,220,417$ --$ 25,826,523$
VILLAGE OF KEY BISCAYNE, FLORIDA
NOTES TO BASIC FINANCIAL STATEMENTS
FISCAL YEAR ENDED SEPTEMBER 30, 2010
36
NOTE 7 – CAPITAL ASSETS (CONTINUED)
Depreciation expense was charged as functions/programs of the primary government as
follows:
Governmental Activities
General government 517,896$
Police 266,948
Fire 283,409
Public works 6,250
Building, zoning and planning 8,468
Parks 425,367
Total Depreciation Expense - Governmental Activities 1,508,339$
Business-type Activities
Stormwater 273,919$
NOTE 8 – LONG-TERM DEBT
The following is a summary of changes in long-term liabilities of the Village for
governmental activities for the year ended September 30, 2010:
Beginning Ending Due Within
Balance Additions Reductions Balance One Year
Governmental Activities
Bonds Payable
Land acquisition and capital improvement
revenue bonds, Series 1999 7,110,000$ --$ (500,000)$ 6,610,000$ 525,000$
Land acquisition and capital improvement
revenue bonds, Series 2000 7,895,000 -- (465,000) 7,430,000 515,000
Capital improvement bonds, Series 2002 7,955,589 -- (414,676) 7,540,913 484,883
Land acquisition and capital improvement
revenue bonds, Series 2004 2,443,595 -- (290,583) 2,153,012 140,107
Transportation tax revenue bonds,
Series 2005 3,206,683 -- (198,854) 3,007,829 212,474
Road improvement revenue bonds,
Series 2006 3,429,293 -- (220,369) 3,208,924 230,425
Total Bonds Payable 32,040,160 -- (2,089,482) 29,950,678 2,107,889
Other Liabilities
Capital leases 105,966 188,444 (157,167) 137,243 --
Compensated absences 2,254,755 635,505 (466,415) 2,423,845 242,834
Total Other Liabilities 2,360,721 823,949 (623,582) 2,561,088 242,834
Governmental Activities Long-Term Liabilities 34,400,881$ 823,949$ (2,713,064)$ 32,511,766$ 2,350,723$
NOTE 8 – LONG-TERM DEBT (CONTINUED)
VILLAGE OF KEY BISCAYNE, FLORIDA
NOTES TO BASIC FINANCIAL STATEMENTS
FISCAL YEAR ENDED SEPTEMBER 30, 2010
37
LAND ACQUISITION AND CAPITAL IMPROVEMENT REVENUE BONDS, SERIES 1999
On July 23, 1999, the Village issued $10,000,000 Land Acquisition and Capital
Improvement Revenue Bonds, Series 1999, the proceeds of which were used for the
acquisition of property and financing of the construction of the Civic Center project. The
bonds mature on July 23, 2019 with final payment due on December 1, 2019. The Village
has pledged non-ad valorem revenues to secure payment of the principal and interest on the
bonds. The bonds are due in annual principal installments. Interest accrues at 4.715% per
annum.
Debt service requirements to maturity are as follows:
Principal Interest Total
Fiscal Year Ending September 30
2011 525,000$ 299,285$ 824,285$
2012 550,000 273,942 823,942
2013 580,000 247,302 827,302
2014 610,000 219,247 829,247
2015 640,000 189,779 829,779
2016-2020 3,705,000 453,701 4,158,701
6,610,000$ 1,683,256$ 8,293,256$
LAND ACQUISITION AND CAPITAL IMPROVEMENT REVENUE BONDS, SERIES 2000
On July 11, 2000, the Village issued a second series of $10,000,000 Capital Improvement
Revenue Bonds, Series 2000, the proceeds of which were used for the acquisition of
property and financing of the construction of the Civic Center project. The bonds mature
on July 11, 2020. The Village has pledged non-ad valorem revenues to secure payment of
the principal and interest on the bonds. The bonds are due in annual principal installments.
Interest accrues at 5.24% per annum.
VILLAGE OF KEY BISCAYNE, FLORIDA
NOTES TO BASIC FINANCIAL STATEMENTS
FISCAL YEAR ENDED SEPTEMBER 30, 2010
38
NOTE 8 – LONG-TERM DEBT (CONTINUED)
LAND ACQUISITION AND CAPITAL IMPROVEMENT REVENUE BONDS, SERIES 2000
(CONTINUED)
Debt service requirements to maturity are as follows:
Principal Interest Total
Fiscal Year Ending September 30
2011 515,000$ 374,529$ 889,529$
2012 540,000 346,888 886,888
2013 570,000 317,806 887,806
2014 600,000 287,152 887,152
2015 630,000 254,926 884,926
2016-2020 4,575,000 750,892 5,325,892
7,430,000$ 2,332,193$ 9,762,193$
CAPITAL IMPROVEMENT REVENUE BONDS, SERIES 2002
On November 1, 2002, the Village issued Capital Improvement Revenue Bonds, Series
2002 for the purpose of financing a portion of the cost of construction and equipping of a
community center including a parking garage and swimming pool. The bonds mature on
November 1, 2022. The Village has pledged non-ad valorem revenues to secure payment
of the principal and interest on the bonds. 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.
Debt service to maturity is as follows:
Principal Interest Total
Fiscal Year Ending September 30
2011 484,883$ 256,316$ 741,199$
2012 502,526 238,673 741,199
2013 520,811 220,388 741,199
2014 539,762 201,437 741,199
2015 559,402 181,797 741,199
2016-2020 3,117,548 588,447 3,705,995
2021-2023 1,815,981 72,440 1,888,421
7,540,913$ 1,759,498$ 9,300,411$
NOTE 8 – LONG-TERM DEBT (CONTINUED)
VILLAGE OF KEY BISCAYNE, FLORIDA
NOTES TO BASIC FINANCIAL STATEMENTS
FISCAL YEAR ENDED SEPTEMBER 30, 2010
39
LAND ACQUISITION AND CAPITAL IMPROVEMENT REVENUE BONDS, SERIES 2004
On December 12, 2004, the Village issued $2,800,000 of capital improvement and land
acquisition revenue bonds, Series 2004 for the purpose of completing the road construction
associated with the new administration, fire and community center buildings. The bonds
mature on November 1, 2022. The Village has pledged non-ad valorem revenues to secure
payment of the principal and interest on the bonds. The bonds are due in quarterly
principal installments. Interest accrues at 3.83% per annum.
Debt service requirements to maturity are as follows:
Principal Interest Total
Fiscal Year Ending September 30
2011 140,107$ 80,195$ 220,302$
2012 145,551 74,751 220,302
2013 151,206 69,096 220,302
2014 157,081 63,221 220,302
2015 163,184 57,118 220,302
2016-2020 916,099 185,414 1,101,513
2021-2023 479,784 22,920 502,704
2,153,012$ 552,715$ 2,705,727$
TRANSPORTATION TAX REVENUE BONDS, SERIES 2005
On July 15, 2005, the Village issued Transportation Tax Revenue Bonds, Series 2005, for
the purpose of financing a portion of the costs of road improvements within the Village
(Crandon Boulevard Improvements – Phase II). The issuance was established similar to
bond anticipation notes where the principal amount is the lesser of $3,500,000 or the
advances made under the bond. Only the amount advanced becomes an obligation of the
Village. The Village has pledged Transportation Surtax Revenues and legally available
non-ad valorem revenues to secure payment of the principal and interest on the bonds. The
bonds mature on July 1, 2025 and are due in quarterly principal installments. Interest
accrues at 4.09% per annum.
VILLAGE OF KEY BISCAYNE, FLORIDA
NOTES TO BASIC FINANCIAL STATEMENTS
FISCAL YEAR ENDED SEPTEMBER 30, 2010
40
NOTE 8 – LONG-TERM DEBT (CONTINUED)
TRANSPORTATION TAX REVENUE BONDS, SERIES 2005 (CONTINUED)
Debt service requirements to maturity are as follows:
Principal Interest Total
Fiscal Year Ending September 30
2011 212,474$ 121,612$ 334,086$
2012 169,602 113,313 282,915
2013 160,687 105,161 265,848
2014 165,667 100,191 265,858
2015 174,312 91,547 265,859
2016-2020 773,720 353,522 1,127,242
2021-2025 1,351,367 135,413 1,486,780
3,007,829$ 1,020,759$ 4,028,588$
ROAD IMPROVEMENT REVENUE BONDS, SERIES 2006
On December 14, 2006, the Village issued $4,000,000 Road Improvement Revenue Bonds,
Series 2006, for the purpose of financing a portion of the costs of road improvements within
the Village (Crandon Boulevard Improvements – Phase III), financing architectural,
engineering, environmental, legal, and other planning costs. The bonds mature on December
1, 2021. The Village has pledged toll revenues to secure payment of the principal and interest
on the bonds. Total principal and interest remaining on the bonds is $4,007,173. For the
current year, debt service and pledged revenues were $357,125 and $365,000, respectively.
The bonds are due in quarterly principal installments. Interest accrues at 4.05% per annum.
Debt service requirements to maturity are as follows:
Principal Interest Total
Fiscal Year Ending September 30
2011 230,425$ 126,700$ 357,125$
2012 239,900 117,224 357,124
2013 249,765 107,360 357,125
2014 260,035 97,090 357,125
2015 270,727 86,398 357,125
2016-2020 1,530,060 255,565 1,785,625
2021-2022 428,012 7,912 435,924
3,208,924$ 798,249$ 4,007,173$
NOTE 8 – LONG-TERM DEBT (CONTINUED)
VILLAGE OF KEY BISCAYNE, FLORIDA
NOTES TO BASIC FINANCIAL STATEMENTS
FISCAL YEAR ENDED SEPTEMBER 30, 2010
41
CAPITAL LEASES
On June 22, 2010, the Village entered into a lease agreement to purchase seven (7) police
vehicles with an approximate market value of $190,000. The lease payments are due on
June 25 each year through maturity of June 25, 2013 at an annual financial cost of 5.85%.
Subsequent to year end, this lease was refinanced at an annual financing cost of 2% and
was combined into a fiscal year 2011 capital lease. At September 30, 2010, the lease
obligation was $137,243.
The following is a summary of changes in long-term liabilities of the Village for business-
type activities for the year ended September 30, 2010:
Beginning Ending Due Within
Balance Additions Reductions Balance One Year
Business-type Activities
Bonds and Loans Payable
Stormwater utility revenue bonds,
Series 1999 4,835,000$ --$ (385,000)$ 4,450,000$ 405,000$
Revolving loan, 1996 320,339 -- (19,957) 300,382 20,602
Revolving loan, 2009 2,067,002 2,448,947 (120,519) 4,395,430 192,858
Water and sewer bonds, Series 2009 -- 1,200,000 (1,200,000) -- --
Total Bonds and Loans Payable 7,222,341 3,648,947 (1,725,476) 9,145,812 618,460
Business-type Activities
Long-Term Liabilities 7,222,341$ 3,648,947$ (1,725,476)$ 9,145,812$ 618,460$
STORMWATER UTILITY REVENUE BONDS, SERIES 1999
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 $7,200,000 Bond
Anticipation Notes, Series 1995. The bonds mature on January 26, 2019. The Village has
pledged stormwater utility fees and non-ad valorem revenues to secure payment of the
principal and interest on the bonds. The bonds are due in annual principal installments on
October 1st. Interest accrues at 4.13% per annum.
VILLAGE OF KEY BISCAYNE, FLORIDA
NOTES TO BASIC FINANCIAL STATEMENTS
FISCAL YEAR ENDED SEPTEMBER 30, 2010
42
NOTE 8 – LONG-TERM DEBT (CONTINUED)
Debt service requirements to maturity are as follows:
Principal Interest Total
Fiscal Year Ending September 30
2011 405,000$ 183,785$ 588,785$
2012 425,000 167,058 592,058
2013 445,000 149,506 594,506
2014 465,000 131,128 596,128
2015 490,000 111,923 601,923
2016-2019 2,220,000 234,791 2,454,791
4,450,000$ 978,191$ 5,428,191$
STATE REVOLVING FUND LOAN, 1996
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 loan is secured by the state revenue
sharing funds. Debt service for fiscal year 2010 was $28,135 and state revenue sharing
was $195,844. The loan is payable in semi-annual payments over 20 years beginning on
April 15, 2003 at an interest rate of 2.56% per annum. The loan matures on October 15,
2022.
Debt service requirements to maturity are as follows:
Principal Interest Total
Fiscal Year Ending September 30
2011 20,602$ 7,532$ 28,134$
2012 21,133 7,001 28,134
2013 21,677 6,457 28,134
2014 22,236 5,898 28,134
2015 22,809 5,325 28,134
2016-2020 124,084 17,504 141,588
2021-2023 67,841 2,622 70,463
300,382$ 52,339$ 352,721$
VILLAGE OF KEY BISCAYNE, FLORIDA
NOTES TO BASIC FINANCIAL STATEMENTS
FISCAL YEAR ENDED SEPTEMBER 30, 2010
43
NOTE 8 – LONG-TERM DEBT (CONTINUED)
STATE REVOLVING FUND LOAN, 2009
In June 2009, the Village entered into a revolving loan agreement with the State of Florida
Department of Environmental Protection in an amount up to $5,150,000 plus $65,500 for a
total of $5,215,500 for the financing of the sanitary sewer construction project. Total
principal due under the loan was $5,318,500 which included loan servicing fees. The
principal total outstanding at September 30, 2010 is $4,395,430. The amortization
schedule herein represents the total debt service to be paid under this loan agreement once
all amounts are borrowed. Proceeds in the amount of $2,067,002 were received during the
2009 fiscal year and $2,448,947 was received during the 2010 fiscal year. The loan is
secured by the communications service tax. Debt service for fiscal year 2010 was
$223,352 and the pledged revenue was $1,076,734. The loan is payable in semi-annual
payments over 20 years beginning on August 15, 2010 and is payable each August 15 and
February 15 at an interest rate of 3.39% per annum. The loan matures on February 15,
2030.
Debt service requirements to maturity are as follows:
Principal Interest Total
Fiscal Year Ending September 30
2011 192,858$ 175,489$ 368,347$
2012 199,451 168,896 368,347
2013 206,270 162,077 368,347
2014 213,322 155,025 368,347
2015 220,615 147,732 368,347
2016-2020 1,221,499 620,237 1,841,736
2021-2025 1,445,071 396,665 1,841,736
2026-2030 1,525,389 132,173 1,657,562
5,224,475$ 1,958,294$ 7,182,769$
WATER AND SEWER REVENUE BONDS, SERIES 2009
On November 10, 2009, the Village issued water and sewer revenue bonds, Series 2009 in
the amount of $1.2 million for the purpose of financing a portion of the costs of water and
sewer improvements within the Village. Interest is at 4.80% per annum and interest was
due quarterly. The bonds mature November 1, 2024; however, the bonds were paid in full
on May 28, 2010 from funds received from a developer.
VILLAGE OF KEY BISCAYNE, FLORIDA
NOTES TO BASIC FINANCIAL STATEMENTS
FISCAL YEAR ENDED SEPTEMBER 30, 2010
44
NOTE 9 – COMMITMENTS AND CONTINGENCIES
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.
GRANTS CONTINGENCY
Federal and State programs in which the Village participates are subject to audit by grantor
agencies. Any disallowed claims, including amounts already collected, may constitute a
liability of the applicable funds. 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.
CONSTRUCTION COMMITMENT
The Village has outstanding construction commitments of approximately $40,000 for its
sanitary sewer project.
NOTE 10 – DEFICIT FUND BALANCE
The Transportation Special Revenue Fund has a deficit fund balance of $1,299,432 which is
being funded from the General Fund and from revenues derived from an interlocal
agreement with Miami-Dade County over a period of approximately 11 years.
NOTE 11 – RESERVED FUND BALANCES
As of September 30, 2010, fund balances in the general fund have been reserved for the
following purposes. The Village, by its charter, cannot have any unreserved fund balance,
therefore, many of the reserves are established to fund current operations, such as working
capital.
VILLAGE OF KEY BISCAYNE, FLORIDA
NOTES TO BASIC FINANCIAL STATEMENTS
FISCAL YEAR ENDED SEPTEMBER 30, 2010
45
NOTE 11 – RESERVED FUND BALANCES (CONTINUED)
Emergencies 4,000,001$
Working Capital 3,826,016
Compensated Absences 484,769
Building Inspections 580,215
Law Enforcement Seizures 300,274
Prepaids 309,253
Police Labor 90,000
Fire Grant Revenue (UASI)42,920
Fire Rescue Transport Fees 449,134
Capital Improvement Plan 2,485,967
Playing Fields 300,514
Police/Admin. Bldg. Reserve 13,632
Fire Station Bldg. Reserve 13,632
Community Center Equip Resv.10,774
Fire Vehicle Replacements 50,000
Master Plan Initiatives 1,864,222
Capital Lease 64,204
Roadway Improvements 175,000
Recreation Facilities 226,162
15,286,689$
NOTE 12 – DEFINED CONTRIBUTION PLANS
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). The plans are administered by a third party administrator.
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 13), were no
longer eligible to contribute to the 401(a) plan. Employer contributions for the fiscal year
ended September 30, 2010 were $518,151 while the employee contributions were
$162,868. Amendments to the Plan must be authorized by the Village Council.
VILLAGE OF KEY BISCAYNE, FLORIDA
NOTES TO BASIC FINANCIAL STATEMENTS
FISCAL YEAR ENDED SEPTEMBER 30, 2010
46
NOTE 12 – DEFINED CONTRIBUTION PLANS (CONTINUED)
SHARE PLAN
In fiscal year 2009, the Village created a SHARE Plan for firefighters. The Plan is a
defined contribution plan and is funded by premium tax revenues from the State of Florida
in excess of the amounts used to satisfy funding requirements of the defined benefit plan of
the firefighters (see Note 13).
During fiscal year 2010, to initially fund the Plan, the Village transferred from their defined
benefit pension plan $797,909. The Plan is administered by ICMA Retirement
Corporation. Benefits are paid to vested participants in a single lump sum or in equal
installments. The balance of the SHARE Plan at September 30, 2010 is $760,060.
NOTE 13 – 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, 2009. The PERS does not issue a stand-alone 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% 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.
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, or at age 50 with 5 years of service with the
benefit discounted 3% for each year under age 55.
VILLAGE OF KEY BISCAYNE, FLORIDA
NOTES TO BASIC FINANCIAL STATEMENTS
FISCAL YEAR ENDED SEPTEMBER 30, 2010
47
NOTE 13 – DEFINED BENEFIT PENSION PLAN (CONTINUED)
PLAN DESCRIPTION (CONTINUED)
Administrative costs of the plan are financed through investment earnings. Benefits and
refunds are recognized when due and payable in accordance with the terms of the plan.
Benefits and funds are recorded when paid.
At October 1, 2009 (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 16
Current Employees
Vested 45
Non-vested 22
Total 67
FUNDING POLICY
The Village’s contribution rate is adjusted each year to an amount equal to the total pension
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 Florida
Statutes. The Village’s (including the State) contribution rate was 15.32% of covered
payroll for the year ended September 30, 2010 which was determined by the October 1,
2008 actuarial valuation. The Village’s (including the State) contribution rate is 15.97% of
covered payroll for the year ended September 30, 2011 which was determined by the
October 1, 2009 actuarial valuation. The participant contribution rate which is fixed by
ordinance is 10.5%. This funding policy is designed to limit the Village’s exposure to
contribute to the Plan. State contributions are recognized as a revenue and expenditure in
the general fund.
VILLAGE OF KEY BISCAYNE, FLORIDA
NOTES TO BASIC FINANCIAL STATEMENTS
FISCAL YEAR ENDED SEPTEMBER 30, 2010
48
NOTE 13 – DEFINED BENEFIT PENSION PLAN (CONTINUED)
FUNDED STATUS AND FUNDING PROGRESS
The funded status of the plan as of October 1, 2009, the most recent actuarial valuation
date, is as follows:
Actuarial
Accrued UAAL
Actuarial Liability Unfunded As % of
Actual Value of (AAL) - AAL Funded Covered Covered
Valuation Assets Entry Age (UAAL) Ratio Payroll Payroll
Date (a) (b) (b) - (a) (a) / (b) (c) (b - a) / c
10/1/09 12,548,462$ 18,495,824$ 5,947,362$ 67.8% 6,808,421$ 87.4%
The schedule of funding progress, presented as required supplementary information (RSI)
following the notes to the financial statements, presents multiyear trend information about
whether the actuarial value of plan assets are increasing or decreasing over time relative to
the AAL for benefits.
Additional information as of the latest actuarial valuation follows:
Valuation Date 10/1/09
Contribution Rates
Employer (and State)15.97%
Plan members 10.50%
Actuarial Cost Method Entry age normal
Amortization Method Level percent of pay, closed
Remaining Amortization 30 years
Asset Valuation Method 5 year Smoothed Market value
Actuarial Assumptions
Investment rate of return*8.5% per year compounded annually,
net of investment related expenses
Projected salary increases*9.4% to 3.5% variable
Cost of living adjustments Not Applicable
*Includes inflation and other general increases at 4%
VILLAGE OF KEY BISCAYNE, FLORIDA
NOTES TO BASIC FINANCIAL STATEMENTS
FISCAL YEAR ENDED SEPTEMBER 30, 2010
49
NOTE 13 – DEFINED BENEFIT PENSION PLAN (CONTINUED)
ANNUAL PENSION COST AND NET PENSION ASSET
The annual pension cost and net pension obligation (asset) for the current year was as
follows:
Annual Required Contribution 1,033,665$
Interest on Net Pension Asset (9,889)
Adjustment to Annual Required Contribution 14,841
Annual Pension Cost 1,038,617
Contributions Made 1,033,665
Decrease in Net Pension Asset 4,952
Net Pension Asset - Beginning of Year (116,341)
Net Pension Asset - End of Year (111,389)$
The annual required contribution for the current year was determined as part of the October
1, 2008 actuarial valuation using the entry age normal funding method.
Annual Percentage Net Pension
Fiscal Year Pension of APC Obligation
Ended Cost (APC)Contributed (Asset)
9/30/2008 843,538$ 99.5% $ (121,512)
9/30/2009 925,291 99.5%(116,341)
9/30/2010 1,038,617 99.5%(111,389)
Trend Information
DROP PLAN
In fiscal year 2009, the Village created a deferred retirement option plan (DROP) for the
benefit of the firefighters that have reached their normal retirement date. Election in the
DROP is voluntary. The maximum period of participation is five years. The DROP is
funded by the participants’ retirement benefit that would be received if the participant had
retired on the election date plus earnings thereon. Retirement benefits can be paid in a
single lump sum payment; equal monthly installments or an annuity. The Plan is
administered by ICMA Retirement Corporation. As of September 30, 2010, there were two
(2) participants in the Plan. The balance in the Plan at September 30, 2010 is $32,484.
VILLAGE OF KEY BISCAYNE, FLORIDA
NOTES TO BASIC FINANCIAL STATEMENTS
FISCAL YEAR ENDED SEPTEMBER 30, 2010
50
NOTE 14 – OTHER POST EMPLOYMENT BENEFITS
PLAN DESCRIPTION
The Village provides an optional single employer defined benefit post-employment
healthcare plan to eligible individuals. The plan allows its employees and their beneficiaries,
at their own cost, to continue to obtain health, dental and other insurance benefits upon
retirement. The benefits of the plan conform to Florida Statutes, which are the legal
authority for the plan. The plan has no assets and does not issue a separate financial report.
FUNDING POLICY AND ANNUAL OPEB COST
The Village does not directly make a contribution to the plan on behalf of retirees.
Retirees and their beneficiaries pay the same group rates as are charged to the Village for
active employees by its healthcare provider. However, the Village’s actuaries, in their
actuarial valuation, calculate an offset to the cost of these benefits as an Employer
Contribution, based upon an implicit rate subsidy. This offset equals the total age-
adjusted costs paid by the Village or its active employees for coverage of the retirees and
their dependents for the year net of the retiree’s own payments for the year.
The annual other post employment benefit (OPEB) cost is calculated based on the annual
required contribution of the employer, an amount actuarially determined in accordance
with GASB Statement No. 45. The annual required contribution represents a level of
funding that, if paid on an ongoing basis, is projected to cover normal cost each year and
to amortize any unfunded actuarial liabilities over a period not to exceed thirty years.
The annual OPEB cost for the Village for the current year and the related information is
as follows:
Required Contribution Rates
Employer Pay-as-you-go
Plan members N/A
Normal Cost 113,504$
Interest on Normal Cost 4,362
Amortization 11,125
Annual OPEB Cost 128,991
Contributions Made (8,499)
Increase in Net OPEB Obligation 120,492
Net OPEB Obligation, Beginning of Year --
Net OPEB Obligation, End of Year 120,492$
VILLAGE OF KEY BISCAYNE, FLORIDA
NOTES TO BASIC FINANCIAL STATEMENTS
FISCAL YEAR ENDED SEPTEMBER 30, 2010
51
NOTE 14 – OTHER POST EMPLOYMENT BENEFITS (CONTINUED)
FUNDING POLICY AND ANNUAL OPEB COST (CONTINUED)
The annual OPEB cost, the percentage of annual OPEB cost contributed to the plan and
the net OPEB obligation was:
Fiscal Year Ended 9/30/2010
Annual OPEB Cost 128,991$
Percentage of OPEB Cost Contributed 6.59%
Net OPEB Obligation 120,492$
FUNDED STATUS AND FUNDING PROGRESS
The funded status of the plan as of October 1, 2008 was as follows:
Actuarial UAAL
Actuarial Accrued Unfunded as a % of
Value of Liability AAL Funded Covered Covered
Assets (AAL) - (UAAL) Ratio Payroll Payroll
(a) (b) (b) - (a) (a) / (b) (c) (b - a) / c
--$ 352,120$ 352,120$ 0.0% 7,612,399$ 4.63%
The actuarial valuation for the calculation of OPEB involves estimates of the value of
reported amounts and assumptions about the probability of events in the future. Amounts
determined regarding the funded status of the plan and the annual required contributions
of the employer are subject to continual revision as actual results are compared to past
expectations and new estimates are made about the future. The required schedule of
funding progress presented as required supplementary information is designed to provide
multi-year trend information to show whether the actuarial value of plan assets is
increasing or decreasing over time relative to the actuarial accrued liability for benefits.
However, the Village has not contributed assets to the plan at this time.
ACTUARIAL METHODS AND ASSUMPTIONS
Projections of benefits are based on the substantive plan (the plan as understood by the
employer and plan members) and include the types of benefits in force at the valuation date
and the pattern of sharing benefit costs between the Village and the plan members to that
point. Actuarial calculations reflect a long-term perspective and employ methods and
assumptions that are designed to reduce short-term volatility in actuarial accrued liabilities
and the actuarial value of assets. Significant methods and assumptions were as follows:
VILLAGE OF KEY BISCAYNE, FLORIDA
NOTES TO BASIC FINANCIAL STATEMENTS
FISCAL YEAR ENDED SEPTEMBER 30, 2010
52
NOTE 14 – OTHER POST EMPLOYMENT BENEFITS (CONTINUED)
ACTUARIAL METHODS AND ASSUMPTIONS (CONTINUED)
Valuation date October 1, 2008
Actuarial cost method Entry Age
Amortization method Level % closed (Remaining amortization 30 years)
Actuarial assumptions:
Investment rate of return* 3.0% compounded annually
Projected salary increases* 6.0% - 9.4%
Payroll growth assumptions 4.0%
*Includes inflation at 3% per year
Healthcare cost trend rate(s):
Insurance Premiums
Select Rates 1.0% for 2009 graded to 5.0% for 2019
Ultimate rate 5.0%
NOTE 15 – 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 in the prior year and there were no settlements that exceeded insurance coverage
for each of the past three years.
REQUIRED SUPPLEMENTARY INFORMATION
Adjusted Variance
Actual Amounts with Final
Amounts Prior on a Budget -
on a Budgetary Year Budgetary Positive
Original Final Basis Reserves Basis (Negative)
Revenues
Property taxes 18,046,097$ 18,046,097$ 17,832,874$ --$ 17,832,874$ (213,223)$
Utility taxes 2,512,095 2,512,095 2,731,766 -- 2,731,766 219,671
Franchise fees 995,000 995,000 1,006,415 -- 1,006,415 11,415
Licenses and permits 1,075,000 1,075,000 1,329,823 -- 1,329,823 254,823
Intergovernmental 834,751 834,751 841,026 -- 841,026 6,275
Charges for services 2,180,556 2,567,460 2,364,777 -- 2,364,777 (202,683)
Interest 25,000 25,000 20,986 -- 20,986 (4,014)
Miscellaneous income 74,920 74,920 133,048 -- 133,048 58,128
Total Revenues 25,743,419 26,130,323 26,260,715 -- 26,260,715 130,392
Expenditures
Current:
General government:
Elected officials 338,622 338,622 297,459 -- 297,459 41,163
Village Clerk 395,389 397,431 345,595 -- 345,595 51,836
Administration 871,994 878,571 856,080 -- 856,080 22,491
Village Attorney 490,000 490,000 506,557 (16,557) 490,000 --
Total general government 2,096,005 2,104,624 2,005,691 (16,557) 1,989,134 115,490
Public safety:
Police 5,163,955 5,173,562 5,115,778 5,115,778 57,784
Fire 6,407,036 6,407,036 6,365,251 -- 6,365,251 41,785
Total public safety 11,570,991 11,580,598 11,481,030 -- 11,481,030 99,568
Public works 1,876,475 1,884,331 1,617,852 -- 1,617,852 266,479
Building, zoning and planning 1,566,150 1,591,761 1,609,737 (17,976) 1,591,761 --
Parks and recreation:
Parks 1,003,506 1,006,895 1,025,125 (18,230) 1,006,895 --
Community center 1,753,425 2,147,970 2,147,970 -- 2,147,970 --
Athletic division 624,418 626,869 564,304 -- 564,304 62,565
Total parks and recreation 3,381,349 3,781,734 3,737,399 (18,230) 3,719,169 62,565
Debt service:
Principal 2,041,459 2,041,459 1,721,460 -- 1,721,460 319,999
Interest and fiscal charges 1,337,474 1,337,474 1,122,032 -- 1,122,032 215,442
Total Expenditures 23,869,903 24,321,981 23,295,201 (52,763) 23,242,438 1,079,543
Excess (Deficiency) of
Revenues over Expenditures 1,873,516 1,808,342 2,965,514 (52,763) 3,018,277 1,157,172
Other Financing Uses
Appropriation of prior years':
Reserves - working capital (1,873,516) (1,833,952) -- 52,763 -- 1,833,952
Reserves - building division -- 25,610 -- -- -- (25,610)
Transfers out -- -- (212,308) -- (212,308) (212,308)
Total Other Financing Uses (1,873,516) (1,808,342) (212,308) 52,763 (212,308) (237,918)
Net Change in Fund Balances --$ --$ 2,753,206$ --$ 2,805,969$ 919,254$
Budgeted Amounts
VILLAGE OF KEY BISCAYNE, FLORIDA
BUDGETARY COMPARISON SCHEDULE
GENERAL FUND
FISCAL YEAR ENDED SEPTEMBER 30, 2010
REQUIRED SUPPLEMENTARY INFORMATION
See note to budgetary comparison schedule.
52
VILLAGE OF KEY BISCAYNE, FLORIDA
REQUIRED SUPPLEMENTARY INFORMATION
NOTE TO BUDGETARY COMPARISON SCHEDULE
FISCAL YEAR ENDED SEPTEMBER 30, 2010
53
NOTE 1 – BUDGETS AND BUDGETARY ACCOUNTING
An annual appropriated budget is prepared for the general fund. The Village prepares a
budget for its special revenue fund and its capital projects fund; however, these budgets are
prepared as project budgets and not as annually appropriated budgets.
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, 2010, there were no supplemental appropriations of $452,078
substantially all related to the additional revenue collected from the community center
due to its expansion of programs.
(e) Formal budgetary integration is employed as a management control device for the
general fund.
(f) The budget for the general fund is adopted on a basis consistent with generally
accepted accounting principles (GAAP), except for certain unbudgeted expenditures of
prior year reserves.
(g) The Village Manager is authorized to transfer part or all of an encumbered
appropriation balance within departments within a fund; however, any revisions that
alter the total appropriations of any department or fund must be approved by the
Village Council. The classification detail at which expenditures may not legally
exceed appropriations is at the department level.
(h) There were no significant budget amendments during fiscal year ended September 30,
2010.
NOTE 2 – RECONCILIATION OF BUDGETARY BASIS TO GAAP BASIS
Expenditures on a Budgetary Basis 23,242,438$
Use of Prior Year Reserves 52,763
State Pension Contributions not Budgeted 362,195
Other Items not Budgeted 136,043
Expenditures on a GAAP Basis 23,793,439$
Actuarial
Accrued UAAL
Actuarial Liability Unfunded As % of
Actual Value of (AAL) - AAL Funded Covered Covered
Valuation Assets Entry Age (UAAL) Ration Payroll Payroll
Date (a) (b) (b) - (a) (a) / (b) (c) (b - a) / c
10/1/04 4,400,914$ 8,021,413$ 3,620,499$ 54.9% 4,960,542$ 73.0%
10/1/05 5,703,772 9,379,732 3,675,960 60.8% 5,320,018 69.1%
10/1/06 7,255,221 10,782,826 3,527,605 67.3% 5,355,088 65.9%
10/1/07 9,017,393 12,335,707 3,318,314 73.1% 5,740,991 57.8%
10/1/08 10,682,895 16,049,481 5,366,586 66.6% 6,365,246 84.3%
10/1/09 12,548,462 18,495,824 5,947,362 67.8% 6,808,421 87.4%
VILLAGE OF KEY BISCAYNE, FLORIDA
PENSION TRUST FUND
REQUIRED SUPPLEMENTARY INFORMATION
SCHEDULE OF FUNDING PROGRESS
54
Year Annual
Ended Required Percentage
September 30, Contribution Contributed
2005 764,420$ 100%
2006 729,857 100%
2007 773,701 100%
2008 839,400 100%
2009 958,925 100%
2010 1,033,665 100%
REQUIRED SUPPLEMENTARY INFORMATION
VILLAGE OF KEY BISCAYNE, FLORIDA
PENSION TRUST FUND
SCHEDULE OF EMPLOYER CONTRIBUTIONS
55
Actuarial UAAL
Actuarial Accrued Unfunded As % of
Actual Value of Liability AAL Funded Covered Covered
Valuation Assets (AAL) - (UAAL) Ration Payroll Payroll
Date (a) (b) (b) - (a) (a) / (b) (c) (b - a) / c
10/1/08 --$ 352,120$ 352,120$ 0.0% 7,612,399$ 4.63%
VILLAGE OF KEY BISCAYNE, FLORIDA
REQUIRED SUPPLEMENTARY INFORMATION
OTHER POST EMPLOYMENT BENEFITS
SCHEDULE OF FUNDING PROGRESS*
*GASB Statement No. 45 was implemented for the fiscal year ended September 30, 2010. The
October 1, 2008 actuarial valuation was the first valuation prepared for the OPEB Plan.
56
STATISTICAL SECTION
Contents Page
Financial Trends
These schedules contain trend information to help the reader understand how the
Village's financial performance and well-being have changed over time. These
schedules include:
57-61
Revenue Capacity
These schedules contain information to help the reader assess the Village's most
significant local revenue source, the property tax.
62-66
Debt Capacity
These schedules present information to help the reader assess the affordability of the
Village's current levels of outstanding debt and the Village's ability to issue
additional debt in the future.
67-70
Demographic and Economic Information
These schedules offer demographic and economic indicators to help the reader
understand the environment within which the Village's financial activities take place.
71-73
Operating Information
These schedules contain service and infrastructure data to help the reader understand
how the information in the Village's financial report relates to the services the Village
provides and the activities it performs.
74-75
STATISTICAL SECTION
This part of the Village of Key Biscayne's comprehensive annual financial report presents
detailed information as a context for understanding what the information in the financial
statements, note disclosures, and required supplementary information says about the Village's
Sources: Unless otherwise noted, the information in these schedules is derived from the
comprehensive annual financial reports for the relevant year.
2003 2004 2005 2006 2007 2008 2009 2010
Governmental activities
Invested in capital assets, net of related debt 23,889,001$ 26,149,714$ 26,284,600$ 28,676,266$ 31,422,358$ 36,139,953$ 38,482,243$ 41,377,118$
Restricted 171,680 283,180 326,826 359,899 261,813 284,639 308,813 --
Unrestricted 4,161,688 2,809,659 4,302,680 4,926,634 8,453,390 10,924,001 15,055,000 16,540,883
Total governmental activities net assets 28,222,369 29,242,553 30,914,106 33,962,799 40,137,561 47,348,593 53,846,056 57,918,001
Business-type activities
Invested in capital assets, net of related debt 2,024,755 1,768,078 1,931,844 2,326,089 2,505,881 10,174,333 15,383,765 16,680,711
Restricted -- -- -- -- -- -- -- --
Unrestricted 1,388,975 1,254,664 1,281,141 778,320 432,133 (2,209,685) (346,721) 1,116,111
Total business-type activities net assets 3,413,730 3,022,742 3,212,985 3,104,409 2,938,014 7,964,648 15,037,044 17,796,822
Total government
Invested in capital assets, net of related debt 25,913,756 27,917,792 28,216,444 31,002,355 33,928,239 46,314,286 53,866,008 58,057,829
Restricted 171,680 283,180 326,826 359,899 261,813 284,639 308,813 --
Unrestricted 5,550,663 4,064,323 5,583,821 5,704,954 8,885,523 8,714,316 14,708,279 17,656,994
Total government net assets 31,636,099$ 32,265,295$ 34,127,091$ 37,067,208$ 43,075,575$ 55,313,241$ 68,883,100$ 75,714,823$
Note: The Village implemented GASB Statement No. 34 for the fiscal year ended September 30, 2003.
Fiscal Year
VILLAGE OF KEY BISCAYNE, FLORIDA
NET ASSETS BY COMPONENT
LAST EIGHT FISCAL YEARS
(ACCRUAL BASIS OF ACCOUNTING)
57
2003 2004 2005 2006 2007 2008 2009 2010
Expenses
Governmental activities:
General government 5,691,379$ 3,614,636$ 2,914,734$ 4,252,037$ 3,781,396$ 3,213,273$ 2,868,728$ 2,751,697$
Fire 4,821,645 4,738,402 4,867,525 4,947,149 5,257,789 6,399,665 6,523,753 6,762,228
Police 4,787,090 4,311,449 4,373,145 4,275,617 4,651,660 5,272,383 5,258,243 5,360,548
Building, zoning and planning 1,252,012 1,220,180 1,235,175 1,547,042 1,447,968 1,529,272 1,540,507 1,611,119
Public works 963,676 1,103,940 2,189,673 4,004,651 1,589,444 2,046,776 1,914,119 1,614,443
Parks and recreation 826,695 1,013,741 2,614,785 2,849,434 3,077,624 3,633,233 4,090,555 4,134,830
Interest on long-term debt 1,064,028 1,487,245 1,305,383 1,413,272 1,505,253 1,436,481 1,447,387 1,366,437
Total governmental activities 19,406,525 17,489,593 19,500,420 23,289,202 21,311,134 23,531,083 23,643,292 23,601,302
Business-type activities:
Stormwater system 634,361 971,081 454,963 720,158 693,135 911,500 779,856 603,262
Solid waste collection 273,076 259,173 466,162 501,417 571,246 619,823 618,155 585,927
Sanitary sewer 6,288 15,732 10,261 9,993 9,454 9,046 144,922 39,178
Total business-type activities 913,725 1,245,986 931,386 1,231,568 1,273,835 1,540,369 1,542,933 1,228,367
Total government expenses 20,320,250$ 18,735,579$ 20,431,806$ 24,520,770$ 22,584,969$ 25,071,452$ 25,186,225$ 24,829,669$
Program revenues
Governmental activities:
Charges for services:
General government 1,034,247$ 961,100$ 1,257,895$ 1,466,186$ 1,389,163$ 1,320,004$ 237,315$ 181,992$
Police 110,215 197,244 212,121 40,719 21,385 14,203 38,181 (1,479)
Fire 5,805 6,505 7,120 50,392 40,144 146,588 136,433 158,975
Parks and recreation 29,752 35,787 1,287,806 1,512,923 1,416,707 1,620,787 1,957,747 2,107,397
Building, zoning and planning 117,705 86,455 142,550 167,802 193,391 133,104 1,173,440 1,247,715
Operating grants and contributions 99,830 -- 650,679 3,559,753 799,493 251,180 157,912 163,752
Capital grants and contributions 421,085 524,736 517,643 -- -- -- 1,709,481 959,360
Total governmental activities program revenues 1,818,639 1,811,827 4,075,814 6,797,775 3,860,283 3,485,866 5,410,509 4,817,712
Business-type activities:
Charges for services:
Stormwater system 531,164 520,729 518,812 517,365 509,571 499,101 491,314 484,932
Solid waste collection 313,492 284,900 533,632 531,967 520,650 530,803 635,580 615,480
Capital grants and contributions:
Stormwater system -- -- -- -- -- -- 331,319 172,164
Sanitary sewer -- -- -- -- -- 5,460,763 6,971,311 2,501,287
Total business-type activities program revenues 844,656 805,629 1,052,444 1,049,332 1,030,221 6,490,667 8,429,524 3,773,863
Total program revenues 2,663,295$ 2,617,456$ 5,128,258$ 7,847,107$ 4,890,504$ 9,976,533$ 13,840,033$ 8,591,575$
(Continued)
Fiscal Year
VILLAGE OF KEY BISCAYNE, FLORIDA
CHANGES IN NET ASSETS
LAST EIGHT FISCAL YEARS
(ACCRUAL BASIS OF ACCOUNTING)
58
2003 2004 2005 2006 2007 2008 2009 2010
Net (expense) revenue
Governmental activities (17,587,886)$ (15,677,766)$ (15,424,606)$ (16,491,427)$ (17,450,851)$ (20,045,217)$ (18,232,783)$ (18,783,590)$
Business-type activities (69,069) (440,357) 121,058 (182,236) (243,614) 4,950,298 6,886,591 2,545,496
Total net expense (17,656,955)$ (16,118,123)$ (15,303,548)$ (16,673,663)$ (17,694,465)$ (15,094,919)$ (11,346,192)$ (16,238,094)$
General revenues
Governmental activities:
Taxes:
Property taxes 11,317,161$ 12,770,711$ 13,360,251$ 14,830,238$ 18,667,979$ 20,051,239$ 19,769,976$ 17,832,874$
Utility taxes 2,251,876 2,219,118 1,488,002 1,549,601 1,467,392 1,534,379 1,555,748 1,655,032
Franchise fees 611,502 677,203 705,810 1,088,929 1,113,194 1,064,666 992,997 1,006,415
Communications services tax -- -- 746,400 797,054 763,801 1,226,423 1,091,734 1,029,087
Intergovernmental 776,869 821,883 978,304 996,092 1,000,265 2,265,243 1,348,324 1,391,242
Investment earnings 82,286 110,562 255,611 306,339 641,115 346,531 44,737 21,346
Miscellaneous 200,561 126,607 281,657 -- -- -- 91,232 131,847
Transfers (9,737) (28,134) (28,135) (28,133) (28,133) (28,134) (164,502) (212,308)
Total governmental activities 15,230,518 16,697,950 17,787,900 19,540,120 23,625,613 26,460,347 24,730,246 22,855,535
Business-type activities:
Investment earnings 22,163 21,235 41,050 45,527 49,086 48,202 21,303 1,974
Transfers 9,737 28,134 28,135 28,133 28,133 28,134 164,502 212,308
Total business-type activities 31,900 49,369 69,185 73,660 77,219 76,336 185,805 214,282
Total general revenues 15,262,418$ 16,747,319$ 17,857,085$ 19,613,780$ 23,702,832$ 26,536,683$ 24,916,051$ 23,069,817$
Change in net assets
Governmental activities (2,357,368)$ 1,020,184$ 2,363,294$ 3,048,693$ 6,174,762$ 6,415,130$ 6,497,463$ 4,071,945$
Business-type activities (37,169) (390,988) 190,243 (108,576) (166,395) 5,026,634 7,072,396 2,759,778
Total change in net assets (2,394,537)$ 629,196$ 2,553,537$ 2,940,117$ 6,008,367$ 11,441,764$ 13,569,859$ 6,831,723$
Note: The Village implemented GASB Statement No. 34 for the fiscal year ended September 30, 2003.
Fiscal Year
VILLAGE OF KEY BISCAYNE, FLORIDA
CHANGES IN NET ASSETS
(Continued)
LAST SEVEN FISCAL YEARS
(ACCRUAL BASIS OF ACCOUNTING)
59
2003 2004 2005 2006 2007 2008 2009 2010
General fund
Reserved 2,967,382$ 4,677,188$ 5,754,277$ 6,874,310$ 9,875,416$ 11,298,178$ 12,318,533$ 15,286,689$
Unreserved 1,000,177 275,000 -- -- -- -- -- --
Total general fund 3,967,559 4,952,188 5,754,277 6,874,310 9,875,416 11,298,178 12,318,533 15,286,689
All other governmental funds
Reserved -- -- -- -- -- -- -- --
Unreserved, reported in:
Special revenue fund 198,563 513,862 (638,221) (1,496,749) (2,482,196) (2,701,623) (1,501,382) (1,299,432)
Capital projects funds 905,611 (489,979) 881,595 1,421,014 2,954,753 4,783,222 6,875,361 5,195,557
Total all other governmental funds 1,104,174 23,883 243,374 (75,735) 472,557 2,081,599 5,373,979 3,896,125
Total governmental funds 5,071,733$ 4,976,071$ 5,997,651$ 6,798,575$ 10,347,973$ 13,379,777$ 17,692,512$ 19,182,814$
Note: The Village implemented GASB Statement No. 34 for the fiscal year ended September 30, 2003.
Fiscal Year
VILLAGE OF KEY BISCAYNE, FLORIDA
FUND BALANCES OF GOVERNMENTAL FUNDS
LAST EIGHT FISCAL YEARS
(MODIFIED ACCRUAL BASIS OF ACCOUNTING)
60
2003 2004 2005 2006 2007 2008 2009 2010
Revenues
Ad valorem taxes 11,317,161$ 12,770,711$ 13,360,251$ 14,830,238$ 18,667,979$ 20,051,239$ 19,769,976$ 17,832,874$
Franchise fees 611,502 677,203 1,452,210 1,885,983 1,113,194 1,064,666 992,997 1,006,415
Utility taxes 2,251,876 2,219,118 1,488,002 1,549,601 2,231,193 1,534,379 2,834,749 2,731,766
Licenses and permits 970,001 961,100 1,040,130 1,196,853 1,298,133 1,240,290 1,188,297 1,329,823
Intergovernmental revenue 999,391 1,031,805 1,495,947 1,756,083 1,593,718 3,189,251 3,047,844 1,203,221
Charges for services 327,723 325,651 1,867,362 2,041,169 1,762,657 1,994,396 2,354,819 2,364,777
Grants 99,830 -- 650,679 2,799,762 206,040 251,180 167,873 163,752
Investment income 82,286 110,562 255,611 306,339 632,355 338,528 44,737 20,983
Miscellaneous 399,124 441,761 281,657 -- 8,762 8,003 26,232 131,848
Total revenues 17,058,894 18,537,911 21,891,849 26,366,028 27,514,031 29,671,932 30,427,524 26,785,459
Expenditures
Current:
General government 1,829,501 1,712,899 2,136,375 2,239,052 2,543,134 2,329,647 2,266,763 1,934,341
Fire 4,046,269 4,462,601 4,749,407 5,117,176 5,122,699 5,744,775 6,407,770 6,584,784
Police 4,305,474 4,113,946 4,605,148 4,388,362 4,590,962 4,863,765 5,116,158 5,093,601
Public works 963,247 1,098,250 2,183,774 4,002,609 1,587,460 1,720,689 1,914,119 1,608,193
Building, planning and zoning 1,245,119 1,212,290 1,238,376 1,544,696 1,455,193 1,513,019 1,540,507 1,602,651
Parks and recreation 782,065 952,261 2,193,633 2,634,887 2,830,020 3,367,638 3,730,084 3,717,935
Capital outlay 5,108,330 10,664,348 4,527,998 6,432,271 6,830,844 4,743,796 1,537,930 408,442
Debt service:
Principal retirement 1,415,000 1,583,924 1,161,298 1,214,646 1,418,401 1,679,991 2,051,307 1,721,460
Interest and other fiscal charges 1,064,028 1,135,384 1,300,596 1,413,272 1,556,396 1,444,576 1,450,649 1,122,032
Total expenditures 20,759,033 26,935,903 24,096,605 28,986,971 27,935,109 27,407,896 26,015,287 23,793,439
Excess (deficiency) of revenues over expenditures (3,700,139) (8,397,992) (2,204,756) (2,620,943) (421,078) 2,264,036 4,412,237 2,992,020
Other financing sources (uses)
Transfers in 938,652 819,251 1,245,653 1,731,583 6,697,854 4,533,094 3,236,194 --
Transfers out (948,389) (847,385) (1,273,788) (1,759,716) (6,725,988) (4,561,228) (3,400,696) (212,308)
Bonds issued 1,657,090 8,330,462 2,850,000 3,450,000 4,000,000 -- -- --
Proceeds from sale of capital assets -- -- -- -- -- -- 65,000 --
Capital lease proceeds -- -- 404,471 -- -- -- -- 188,444
Total other financing sources (uses)1,647,353 8,302,328 3,226,336 3,421,867 3,971,866 (28,134) (99,502) (23,864)
Net change in fund balances (2,052,786)$ (95,664)$ 1,021,580$ 800,924$ 3,550,788$ 2,235,902$ 4,312,735$ 2,968,156$
Debt service as a percentage
of non-capital expenditures 11.94% 10.10% 10.22% 9.07% 10.65% 16% 17% 14%
Note: The Village implemented GASB Statement No. 34 for the fiscal year ended September 30, 2003.
VILLAGE OF KEY BISCAYNE, FLORIDA
CHANGES IN FUND BALANCES OF GOVERNMENTAL FUNDS
LAST EIGHT FISCAL YEARS
(MODIFIED ACCRUAL BASIS OF ACCOUNTING)
Fiscal Year
61
Fiscal Ad Valorem Franchise Utility Inter- Communications
Year Taxes Taxes Taxes governmental* Services Tax** Total
2001 8,737,608$ 738,513$ 1,772,208$ 930,169$ --$ 12,178,498$
2002 9,569,030 639,072 2,258,931 971,136 904,475 14,342,644
2003 11,317,161 611,502 2,251,876 999,391 825,739 16,005,669
2004 12,770,711 677,203 2,219,118 1,031,805 770,637 17,469,474
2005 13,360,125 705,810 2,234,402 1,140,599 746,400 18,187,336
2006 14,830,238 1,088,929 1,549,601 1,756,083 797,054 20,021,905
2007 18,667,979 1,113,194 1,467,392 1,593,718 763,801 23,606,084
2008 20,051,239 1,064,666 610,371 3,189,251 1,226,423 26,141,950
2009 19,769,976 992,997 1,555,748 3,047,844 1,091,734 26,458,299
2010 17,832,874 1,006,415 2,731,766 1,203,221 1,029,087 23,803,363
**Communications services tax became effective 10/01/01, replacing utility taxes and franchise fees on
telephone and cable TV.
VILLAGE OF KEY BISCAYNE, FLORIDA
GENERAL GOVERNMENTAL TAX REVENUES BY SOURCE
LAST TEN FISCAL YEARS
(MODIFIED ACCRUAL BASIS OF ACCOUNTING)
Source: Village of Key Biscayne Finance Department.
*Includes half-cent sales tax and state revenue sharing.
62
Total
Fiscal Year Total Net Direct
Ended Residential Commercial Personal Assessed Tax
September 30, Property Property Property Value Rate
2001 2,618,160,883$ 82,923,284$ 30,749,478$ 2,731,833,645$ 3.606
2002 3,128,872,469 99,098,715 31,948,797 3,259,919,981 3.606
2003 3,506,812,044 111,068,946 43,233,556 3,661,114,546 3.606
2004 3,713,841,630 117,626,058 43,867,688 3,875,335,376 3.606
2005 4,115,175,292 130,346,736 41,852,920 4,287,374,948 3.606
2006 5,421,393,923 166,638,240 47,020,078 5,635,052,241 3.606
2007 6,173,257,097 294,540,559 46,315,146 6,514,112,802 3.450
2008 6,040,318,378 326,676,816 38,432,567 6,405,427,760 3.200
2009 5,463,859,789 295,500,370 34,764,749 5,794,124,909 3.200
2010 5,107,861,469 276,247,015 32,499,649 5,416,608,133 3.200
Source: Miami-Dade County Property Appraiser's Office.
Note: Property in the Village is reassessed each year. Property is assessed at actual value,
therefore, the assessed values are equal to actual value. Tax rates are per $1,000 of assessed
value.
Real Property
VILLAGE OF KEY BISCAYNE, FLORIDA
ET ASSESSED VALUE AND ESTIMATED ACTUAL VALUE OF TAXABLE PROPERT
LAST TEN FISCAL YEARS
63
Florida South Total
Debt Total Debt Total Inland Florida Direct and
Fiscal Tax Roll General Debt Total Operating Service County Operating Service School Navigation Water Overlapping
Year Year Operations Service Village Millage Millage Millage Millage Millage Millage District Management Other Rates
2001 2000 3.606 - 3.606 5.751 0.652 6.403 8.702 0.915 9.617 0.041 0.597 0.451 20.715
2002 2001 3.606 - 3.606 5.713 0.552 6.265 8.528 0.848 9.376 0.039 0.697 0.451 20.434
2003 2002 3.606 - 3.606 5.889 0.390 6.279 8.482 0.770 9.252 0.039 0.697 0.451 20.324
2004 2003 3.606 - 3.606 5.969 0.285 6.254 8.418 0.682 9.100 0.039 0.597 1.086 20.682
2005 2004 3.606 - 3.606 5.935 0.285 6.220 8.090 0.597 8.687 0.039 0.597 1.030 20.179
2006 2005 3.606 - 3.606 5.835 0.285 6.120 7.947 0.491 8.438 0.039 0.597 1.014 19.814
2007 2006 3.450 - 3.450 5.615 0.285 5.900 7.691 0.414 8.105 0.039 0.597 1.008 19.099
2008 2007 3.200 - 3.200 5.220 0.285 5.505 7.533 0.264 7.797 0.035 0.535 0.511 17.582
2009 2008 3.200 - 3.200 4.838 0.285 5.123 7.698 0.297 7.995 0.035 0.535 0.972 17.859
2010 2009 3.200 - 3.200 5.428 0.445 5.873 7.864 0.385 8.249 0.035 0.535 0.873 18.764
(1) Overlapping rates are those of local and county governments that apply to property owners within the Village of Key Biscayne. Not all overlapping
rates apply to all Village of Key Biscayne property owners (i.e. the rates for special districts apply only to the proportion of the government's property
owners whose property is located within the geographic boundaries of the special district).
VILLAGE OF KEY BISCAYNE, FLORIDA
PROPERTY TAX RATES - DIRECT AND OVERLAPPING GOVERNMENTS
LAST TEN FISCAL YEARS
Miami-Dade County
Overlapping Rates (1)Village of Key Biscayne
Miami-Dade Schools
Note: All millage rates are based on $1 for every $1,000 of assessed value.
Sources: Village of Key Biscayne Finance Department and Miami-Dade County Property Appraiser's Office.
64
Percent of Percent of
Total Total
Net Village Net Net Village Net
Assessed Assessed Assessed Assessed
Taxpayer Value Rank Value Taxpayer Value Rank Value
GB Hotel Partners LTD 46,000,000$ 1 0.85% Sonesta Beach Resort, LP 40,447,828$ 1 1.48%
SBR Fortune Associates 44,568,400 2 0.82% Grand Bay Tower Associates 26,192,000 2 0.96%
EDW A McCarthy-Archbishop 23,527,994 3 0.43% GB Hotel Partners LTD 23,341,830 3 0.85%
Galleria of Key Biscayne Inc 19,300,000 4 0.36% Key Biscayne Shopping Center 8,672,526 4 0.32%
Key Biscayne Properties LLC 15,134,130 5 0.28% Galleria of Key Biscayne Inc 7,467,541 5 0.27%
Red Dragon's Sands LTD 14,568,368 6 0.27% Florida Power & Light 6,503,744 6 0.24%
United Real Estate Ventures Inc 13,010,965 6 0.24% Ocean Club 5,920,230 7 0.22%
260 Cape FLA LLC 12,995,950 7 0.24% Bellsouth 5,917,426 8 0.22%
Tesaurus Holdings Inc 12,851,673 8 0.24% Pitu, Inc. 5,798,964 9 0.21%
Key Biscayne Presbyterian Churc 12,704,963 9 0.23%Charles G. Rebozo, Trust 5,701,062 10 0.21%
214,662,443$ 3.96%135,963,151$ 4.98%
Source: Tax roll provided by Miami-Dade County Property Appraiser.
2010 2001
VILLAGE OF KEY BISCAYNE, FLORIDA
PRINCIPAL PROPERTY TAXPAYERS
CURRENT YEAR AND NINE YEARS AGO
65
Total Taxes
Fiscal Year Levied for Collections in
Ended Fiscal Percent Subsequent Percent
September 30, Year Amount of Levy Year's Amount of Levy
2001 9,011,571$ 8,738,608$ 96.97% 13,108$ 8,751,716$ 97.12%
2002 9,850,992 9,515,138 96.59% 14,273 9,529,411 96.74%
2003 11,755,271 11,317,160 96.27% 16,976 11,334,136 96.42%
2004 13,201,979 12,869,711 97.48% 19,305 12,889,016 97.63%
2005 13,974,460 13,360,251 95.60% 20,040 13,380,291 95.75%
2006 15,461,356 14,830,238 95.92% 22,245 14,852,483 96.06%
2007 19,423,659 18,667,979 96.11% 28,002 18,695,981 96.25%
2008 19,802,903 19,272,664 97.32% 273,302 19,545,966 98.70%
2009 19,561,571 19,157,014 97.93% 367,746 19,524,760 99.81%
2010 18,046,097 17,832,874 98.82% 197,199 18,030,073 99.91%
VILLAGE OF KEY BISCAYNE, FLORIDA
PROPERTY TAX LEVIES AND COLLECTIONS
LAST TEN FISCAL YEARS
the Fiscal Year
Source: Village of Key Biscayne Finance Department and Miami-Dade County Tax Collector's Office.
of the Levy to Date
Total Collections
Collected within
66
Business-Type
Activities
Fiscal Year General Percent of
Ended Obligation Revenue Loans Revenue Personal Per
September 30, Bonds Bonds Payable Bonds Total Income (1) Capita (1)
2001 --$ 30,120,000$ --$ 6,940,000$ 37,060,000$ 0.00% 3,592
2002 -- 29,935,000 -- 6,810,000 36,745,000 0.00% 3,562
2003 -- 29,271,000 -- 6,625,000 35,896,000 0.00% 3,479
2004 -- 29,164,892 -- 6,430,000 35,594,892 0.00% 3,450
2005 -- 30,850,606 -- 6,010,000 36,860,606 0.00% 3,573
2006 -- 33,085,960 -- 5,785,000 38,870,960 0.00% 3,768
2007 -- 31,695,102 -- 5,200,000 36,895,102 0.00% 3,576
2008 -- 33,987,811 5,000,000 5,539,919 44,527,731 0.00% 4,238
2009 -- 32,040,160 -- 7,222,341 39,262,501 0.00% 3,737
2010 -- 29,950,678 -- 9,145,812 39,096,490 0.00% 3,167
Governmental Activities
VILLAGE OF KEY BISCAYNE, FLORIDA
RATIOS OF OUTSTANDING DEBT BY TYPE
LAST TEN FISCAL YEARS
Note: Details regarding the Village's outstanding debt can be found in the notes to the financial statements.
67
VILLAGE OF KEY BISCAYNE, FLORIDA
RATIOS OF GENERAL BONDED DEBT OUTSTANDING
LAST TEN FISCAL YEARS
The Village does not have general obligation debt.
68
Percentage Amount
Net Applicable to Applicable to
Debt the Village of the Village of
Government Unit Outstanding Key Biscayne (1)Key Biscayne
Direct:
Village of Key Biscayne 39,096,490$ 100.00% 39,096,490$
Overlapping debt:
Miami-Dade County 843,961,000 5.87%49,565,830
Miami-Dade County School Board 405,070,000 8.25%33,414,224
Subtotal, Overlapping Debt 82,980,054
Village of Key Biscayne Direct Debt 39,096,490
Total Direct and Overlapping Debt 122,076,544$
(1) For debt repaid with property taxes, the percentage of overlapping debt applicable is
estimated using taxable assessed property values. Value that is within the Village's boundaries
and dividing it by the County's and School Board's total taxable assessed value. This approach
was also used for the other debt.
2010
VILLAGE OF KEY BISCAYNE, FLORIDA
DIRECT AND OVERLAPPING GOVERNMENTAL ACTIVITIES DEBT
SEPTEMBER 30, 2010
Note: Overlapping governments are those that coincide, at least in part, with the geographic
boundaries of the Village. This schedule estimates the portion of the outstanding debt of those
overlapping governments that is borne by the residents and businesses of the Village of Key
Biscayne. This process recognizes that, when considering the Village's ability to issue and
repay long-term debt, the entire debt burden borne by the residents and businesses should be
taken into account. However, this does not imply that every taxpayer is a resident, and therefore
responsible for repaying the debt, of each overlapping government.
Sources: Data provided by the Miami-Dade County Finance Department and the Miami-Dade
County School Board.
69
Fiscal Year Non-
Ended Ad Valorem
September 30,Revenues Principal Interest Coverage
2001 5,777,408$ 975,000$ 631,875$ 3.60
2002 5,426,424 1,015,000 1,420,845 2.23
2003 5,741,733 1,415,000 1,064,028 2.86
2004 5,767,200 1,583,924 1,135,384 2.14
2005 8,531,598 1,161,298 1,300,596 3.47
2006 11,535,790 1,214,646 1,413,272 4.27
2007 8,846,052 1,418,401 1,556,396 3.42
2008 9,620,693 1,679,991 1,444,576 3.08
2009 10,657,548 2,051,307 1,450,649 3.04
2010 8,952,585 1,721,460 1,122,032 3.15
VILLAGE OF KEY BISCAYNE, FLORIDA
PLEDGED REVENUE COVERAGE
LAST TEN FISCAL YEARS
Debt Service
Source: Village of Key Biscayne Finance Department.
70
Median Per Capita
Household Personal Unemployment
Year Population (1) Income (3) Income (3) Rate (4)
2001 10,507 86,599$ 54,214$ 6.1%
2002 10,507 86,599 54,214 6.0%
2003 10,507 86,599 54,214 5.8%
2004 10,507 86,599 54,214 5.1%
2005 10,507 86,599 54,214 4.2%
2006 10,507 86,599 54,214 3.9%
2007 10,507 86,599 54,214 4.6%
2008 10,507 86,599 54,214 6.9%
2009 10,507 86,599 54,214 11.0%
2010 12,344 N/A N/A 12.1%
Sources:
(1) United States Census Bureau, 2010 Census data.
(3) United States Census Bureau, 2000 Census data, current data not yet available.
(4) U.S. Department of Labor. Rates are for Miami-Dade County.
VILLAGE OF KEY BISCAYNE, FLORIDA
DEMOGRAPHIC AND ECONOMIC STATISTICS
LAST TEN FISCAL YEARS
Note: Unemployment rate shown is based on fiscal year end.
71
Percentage of Percentage of
Total Village Total Village
Employer Employees (1) Rank Employment Employees Rank Employment
Ritz Carlton Key Biscayne 1,500 1 not known
Winn Dixie Stores, Inc. 250 3 not known
Village of Key Biscayne 114 3 not known
All remaining employers are of an extremely small number
Total 1,864
Notes: (1) All amounts are estimated for timely inclusion in report. Requests for information received no response.
VILLAGE OF KEY BISCAYNE, FLORIDA
PRINCIPAL EMPLOYERS
Information not available
2010 2001
CURRENT YEAR AND NINE YEARS AGO
72
2001 2002 2003 2004 2005 2006 2007 2008 2009 2010
Number of employees:
General government 7 7 5 6 7 6 6 6 8 7
Public safety 72 72 74 76 79 79 79 78 81 80
Building, planning and zoning 16 16 12 12 13 13 14 13 13 13
Public works 3 3 5 5 5 5 4 4 4 4
Parks and recreation 3 4 4 4 6 6 7 7 10 10
Total number of employees 101 102 100 103 110 109 110 108 116 114
Source: Village of Key Biscayne Finance Department budget.
LAST TEN FISCAL YEARS
FULL-TIME EQUIVALENT VILLAGE GOVERNMENT EMPLOYEES BY FUNCTION
VILLAGE OF KEY BISCAYNE, FLORIDA
73
Function/Program 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010
Public safety:
Police:
Police personnel and officers 40 40 40 41 40 40 40 39 42 41
Police calls for service 20,659 21,127 20,660 19,004 16,510 13,006 35,412 36,190 37,002 34,935
Parking violations 639 789 639 628 682 801 996 776 824 523
Traffic violations 2,433 2,875 2,433 3,035 1,397 1,468 1,104 946 975 1,425
Fire:
Fire personnel 33 33 34 35 39 39 39 39 39 39
Fire incidents 485 1,050 1,114 1,148 1,403 1,103 998 1,006 1,012 1,556
Fire inspections performed 470 476 840 307 332 269 220 305 229 267
Planning and development:
Business permits issued 1,803 2,313 2,581 3,061 3,045 3,000 3,504 3,620 2,451 2,794
Business tax receipts issued 625 729 668 428 433 475 914 1,224 1,324 1,142
Culture and recreation:
Number of building users -- -- -- -- 6,373 6,461 5,778 4,673 4,268 3,990
Solid waste:
Residential accounts 1,200 1,200 1,200 1,200 1,200 1,200 1,200 1,299 1,298 1,302
Sources: Various Village Departments.
LAST TEN FISCAL YEARS
OPERATING INDICATORS BY FUNCTION/PROGRAM
VILLAGE OF KEY BISCAYNE, FLORIDA
74
Function/Program 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010
General government:
Number of general government buildings 1 1 1 1 1 1 1 1 1 1
Public safety:
Police:
Police stations 1 1 1 1 1 1 1 1 1 1
Patrol units 3 3 3 3 3 3 3 3 3 3
Fire:
Fire stations 1 1 1 1 1 1 1 1 1 1
Transportation:
Miles of streets 22 22 22 22 22 22 22 22 22 22
Number of street lights 250 300 300 300 300 300 300 300 300 300
Number of traffic signals 4 4 4 4 4 4 4 4 4 4
Culture and recreation:
Parks 3 3 3 3 3 3 3 3 3 3
Parks acreage 9 9 9 9 9 9 9 9 9 9
Community center -- -- -- -- 1 1 1 1 1 1
Swimming pools -- -- -- -- 1 1 1 1 1 1
Sources: Various Village Departments.
VILLAGE OF KEY BISCAYNE, FLORIDA
CAPITAL ASSET STATISTICS BY FUNCTION/PROGRAM
LAST TEN FISCAL YEARS
75
COMPLIANCE SECTION
76
Independent Auditors’ Report on Internal Control over Financial Reporting and on
Compliance and Other Matters Based on an Audit of Financial Statements
Performed in Accordance with Government Auditing Standards
Honorable Mayor, Village Council and Village Manager
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 fiscal year ended September 30, 2010, and
have issued our report thereon dated March 24, 2011. We conducted our audit in accordance
with auditing standards generally accepted in the United States of America and the standards
applicable to financial audits contained in Government Auditing Standards, issued by the
Comptroller General of the United States.
Internal Control Over Financial Reporting
In planning and performing our audit, we considered the Village’s internal control over financial
reporting as a basis for designing our auditing procedures for the purpose of expressing our
opinion on the basic financial statements, but not for the purpose of expressing an opinion on the
effectiveness of the Village’s internal control over financial reporting. Accordingly, we do not
express an opinion on the effectiveness of the Village’s internal control over financial reporting.
A deficiency in internal control exists when the design or operation of a control does not allow
management or employees, in the normal course of performing their assigned functions, to
prevent, or detect and correct misstatements on a timely basis. A material weakness is a
deficiency, or combination of deficiencies, in internal control such that there is a reasonable
possibility that a material misstatement of the entity’s financial statements will not be prevented,
or detected and corrected on a timely basis.
Our consideration of internal control over financial reporting was for the limited purpose
described in the first paragraph of this section and was not designed to identify all deficiencies in
internal control over financial reporting that might be deficiencies, significant deficiencies or
material weaknesses. We did not identify any deficiencies in internal control over financial
reporting that we consider to be material weaknesses, as defined above.
77
Compliance and Other Matters
As part of obtaining reasonable assurance about whether the Village of Key Biscayne’s financial
statements are free of material misstatement, we performed tests of its compliance with certain
provisions of laws, regulations, contracts and grant agreements, noncompliance with which
could have a direct and material effect on the determination of financial statement amounts.
However, providing an opinion on compliance with those provisions was not an objective of our
audit and, accordingly, we do not express such an opinion. The results of our tests disclosed no
instances of noncompliance or other matters that are required to be reported under Government
Auditing Standards.
This report is intended solely for the information and use of the Mayor, Village Council, Village
Manager and regulatory agencies, and is not intended to be and should not be used by anyone
other than these specified parties.
Miami, FL
March 24, 2011
78
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 Village of Key Biscayne, Florida (the Village) as
of and for the fiscal year ended September 30, 2010, and have issued our report thereon dated
March 24, 2011.
We conducted our audit in accordance with auditing standards generally accepted in the United
States of America; the standards applicable to financial audits contained in Government Auditing
Standards, issued by the Comptroller General of the United States; and OMB Circular A-133,
Audits of States, Local Governments, and Non-Profit Organizations. We have issued our
Independent Auditors’ Report on Internal Control over Financial Reporting and on Compliance
and Other Matters based on an audit of financial statements, Independent Auditor’s Report on
Compliance With Requirements Applicable to Each Major Program and on Internal Control
Over Compliance in Accordance With OMB Circular A-133 and Schedule of Findings and
Questioned Costs. Disclosures in those reports and schedule, which are dated March 24, 2011,
should be considered in conjunction with this management letter.
Additionally, our audit was conducted in accordance with Chapter 10.550, Rules of the Auditor
General, which governs the conduct of local governmental entity audits performed in the State of
Florida. This letter includes the following information, which is not included in the
aforementioned auditors’ report or schedule:
Section 10.554(1)(i)1., Rules of the Auditor General, requires that we determine whether
or not corrective actions have been taken to address findings and recommendations made
in the preceding annual financial audit report. There were no recommendations made in
the preceding annual financial audit report.
Section 10.554(1)(i)2., Rules of the Auditor General, requires our audit to include a
review of the provisions of Section 218.415, Florida Statutes, regarding the investment of
public funds. In connection with our audit, we determined that the Village complied with
Section 218.415, Florida Statutes.
Section 10.554(1)(i)3., Rules of the Auditor General, requires that we address in the
management letter any recommendations to improve financial management. In
connection with our audit, we did not have any such recommendations.
79
Section 10.554(l)(i)4., Rules of the Auditor General, requires that we address violations
of provisions of contracts or grant agreements, or abuses that have occurred, or are likely
to have occurred, that have an effect on the financial statements that is less than material
but more than inconsequential. In connection with our audit, we did not have any such
findings.
Section 10.554(l)(i)5., Rules of the Auditor General, provides that the auditor may, based
on professional judgment, report the following matters that have an inconsequential
effect on financial statements, considering both quantitative and qualitative factors: (1)
violations of provisions of contracts or grant agreements, fraud, illegal acts, or abuse, and
(2) deficiencies in internal control that are not significant deficiencies. In connection
with our audit, we did not have any such findings.
Section 10.554(1)(i)6., Rules of the Auditor General, requires that the name or official
title and legal authority for the primary government and each component unit of the
reporting entity be disclosed in this management letter, unless disclosed in the notes to
the financial statements. Village of Key Biscayne was incorporated by the Laws of
Florida, Act of 1955. There are no component units related to the Village.
Section 10.554(1)(i)7.a., Rules of the Auditor General, requires a statement to be
included as to whether or not the local governmental entity has met one or more of the
conditions described in Section 218.503(1), Florida Statutes, and identification of the
specific condition(s) met. In connection with our audit, we determined that the Village
did not meet any of the conditions described in Section 218.503(1), Florida Statutes.
Section 10.554(1)(i)7.b., Rules of the Auditor General, requires that we determine
whether the annual financial report for the Village for the fiscal year ended September
30, 2010, filed with the Florida Department of Financial Services pursuant to Section
218.32(1)(a), Florida Statutes, is in agreement with the annual financial report for the
fiscal year ended September 30, 2010. In connection with our audit, we determined that
these two reports were in agreement.
Pursuant to Sections 10.554(l)(i)7.c. and 10.556(7), Rules of the Auditor General, we
applied financial condition assessment procedures. It is management's responsibility to
monitor the Village's financial condition, and our financial condition assessment was
based in part on representations made by management and the review of financial
information provided by same. This assessment was done as of the fiscal year end.
80
Pursuant to Chapter 119, Florida Statutes, this management letter is a public record and its
distribution is not limited. Auditing standards generally accepted in the United States of America
require us to indicate that this letter is intended solely for the information and use of the Village
Council, management, and the Florida Auditor General, and is not intended to be and should not
be used by anyone other than these specified parties.
Miami, FL
March 24, 2011
81
Independent Auditors’ Report on Compliance with Requirements That Could Have a
Direct and Material Effect on Each Major Program and on 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 Village of key Biscayne, Florida’s (the Village) compliance with the types of
compliance requirements described in the OMB Circular A-133 Compliance Supplement that
could have a direct and material effect on each of the Village’s major federal programs for the
year ended September 30, 2010. The Village’s major federal programs are 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
each of its major federal programs 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 of America; 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.
Those standards and OMB Circular A-133 require that we plan and perform the audit to obtain
reasonable assurance about whether noncompliance with the types of compliance requirements
referred to above that could have a direct and material effect on a major federal 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 of the Village’s compliance with those requirements.
In our opinion, the Village, complied, in all material respects, with the compliance requirements
referred to above that could have a direct and material effect on each of its major federal
programs for the year ended September 30, 2010. However, the results of our auditing
procedures disclosed one instance of noncompliance with those requirements, which is required
to be reported in accordance with OMB Circular A-133 and which is described in the
accompanying schedule of findings and questioned costs as item 2010-1.
82
Internal Control Over Compliance
Management of the Village, is responsible for establishing and maintaining effective internal
control over compliance with the requirements of laws, regulations, contracts, and grants
applicable to federal programs. In planning and performing our audit, we considered the
Village’s internal control over compliance with the requirements that could have a direct and
material effect on a major federal program to determine the 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, but not for the purpose of expressing an
opinion on the effectiveness of internal control over compliance. Accordingly, we do not
express an opinion on the effectiveness of the Village’s internal control over compliance.
A deficiency in internal control over compliance exists when the design or operation of a control
over compliance does not allow management or employees, in the normal course of performing
their assigned functions, to prevent, or detect and correct, noncompliance with a type of
compliance requirement of a federal program on a timely basis. A material weakness in internal
control over compliance is a deficiency, or combination of deficiencies, in internal control over
compliance, such that there is a reasonable possibility that material noncompliance with a type of
compliance requirement of a federal program will not be prevented, or detected and corrected, on
a timely basis.
Our consideration of internal control over compliance was for the limited purpose described in
the first paragraph of this section and was not designed to identify all deficiencies in internal
control over compliance that might be deficiencies, significant deficiencies, or material
weaknesses. We did not identify any deficiencies in internal control over compliance that we
consider to be material weaknesses, as defined above.
The Village’s response to the finding identified in our audit is described in the accompanying
schedule of findings and questioned costs. We did not audit the Village’s responses and,
accordingly, we express no opinion on the response.
This report is intended solely for the information and use of management, Village Council,
others within the entity, federal awarding agencies, and pass-through entities and is not intended
to be and should not be used by anyone other than these specified parties.
Miami, FL
March 24, 2011
Federal Pass-Through
CFDA Entity Identifying Federal
Federal Grantor/Pass-Through Grantor/Program Title Number Number Expenditures
U.S. Department of Homeland Security
Urban Area Security Initiative 97.067 N/A 38,709$
U.S. Environmental Protection Agency
Pass-Through Program from:
State of Florida Department of Environmental
Protection - State Revolving Loan Fund 66.458 CS120001-090 1,959,158
U.S. Department of Justice
Pass-Through Program from:
State of Florida Department of Law
Enforcement - Criminal Justice Grant (ARRA) 16.803
2010-ARRD-DADE-
2-W8-036 7,733
U.S. Department of Transportation - Federal
Highway Administration
Pass-Through Program from:
State of Florida Department of Transportation -
Harbor Drive Resurfacing (ARRA)20.205 426185-1 261,587
Total Expenditures of Federal Awards 2,267,187$
VILLAGE OF KEY BISCAYNE, FLORIDA
SCHEDULE OF EXPENDITURES OF FEDERAL AWARDS
FISCAL YEAR ENDED SEPTEMBER 30, 2010
See note to schedule of expenditures of federal awards.
83
84
VILLAGE OF KEY BISCAYNE, FLORIDA
NOTE TO THE SCHEDULE OF EXPENDITURES OF FEDERAL AWARDS
FISCAL YEAR ENDED SEPTEMBER 30, 2010
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 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.
85
VILLAGE OF KEY BISCAYNE, FLORIDA
SUMMARY SCHEDULE OF PRIOR AUDIT FINDINGS
FISCAL YEAR ENDED SEPTEMBER 30, 2010
PRIOR YEAR FINANCIAL STATEMENT FINDINGS
There were no findings for the year ended September 30, 2009.
PRIOR YEAR FEDERAL AWARDS FINDINGS AND QUESTIONED COSTS
There were no findings for the year ended September 30, 2009.
PRIOR YEAR STATE FINANCIAL ASSISTANCE FINDINGS AND QUESTIONED
COSTS
There were no findings for the year ended September 30, 2009.
86
VILLAGE OF KEY BISCAYNE, FLORIDA
SCHEDULE OF FINDINGS AND QUESTIONED COSTS
FISCAL YEAR ENDED SEPTEMBER 30, 2010
SECTION I - SUMMARY OF AUDITOR’S RESULTS
Financial Statements
Type of auditor’s report issued: Unqualified Opinion
Internal control over financial reporting:
Material weakness(es) identified? yes X no
Significant deficiency(ies) identified not considered to be
material weakness(es)?
yes
X
none reported
Noncompliance material to financial statements noted? yes X no
Federal Awards Programs
Internal control over major programs:
Material weakness(es) identified? yes X no
Significant deficiency(ies) identified not considered to be
material weakness(es)?
yes
X
none reported
Type of auditor’s report issued on compliance for
major programs:
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 major programs:
Federal Program CFDA No.
State Revolving Loan Fund 66.458
Highway Planning and Construction 20.205
Dollar threshold used to distinguish between Type A and
Type B programs:
$300,000
Auditee qualified as low-risk auditee for federal
awards programs?
yes
X
no
87
VILLAGE OF KEY BISCAYNE, FLORIDA
SCHEDULE OF FINDINGS AND QUESTIONED COSTS
FISCAL YEAR ENDED SEPTEMBER 30, 2010
SECTION II – FINANCIAL STATEMENT FINDINGS
None.
SECTION III – FEDERAL AWARD FINDINGS AND QUESTIONED COSTS
2010-01 Noncompliance Finding on Grant Compliance Requirement - State Revolving Loan
Criteria
Article III – Loan Repayment Account of the Clean Water State Revolving Loan Agreement
(Contract #WW850050), requires the Village of Key Biscayne (Village) to establish a Loan Debt
Service Account with a Depository and make monthly loan deposits no later than February 15,
2010. In addition beginning six months prior to each semiannual loan payment, the Village is
required to make six monthly loan deposits. The first five deposits each shall be equal to one-
sixth of the Semiannual Loan Payment. The sixth monthly loan deposit shall be at least equal to
the amount required to make the total on deposit in the Loan Debt Service Account equal to the
semiannual loan payment amount. Any month, in which the Village fails to make the required
monthly loan deposits, the Village’s Chief Financial Officer is required to notify the State of
Florida Department of Environmental Protection of such failure. The funds in this account
should not be comingled with any other of the Village’s funds other than the debt service
requirements under this loan agreement.
Condition
During audit procedures performed, auditor noted the Village had not established a separate
Loan Repayment Account as required per the Clean Water State Revolving Loan Agreement
(Contract #WW850050). The Village had opened a bank account but did not exclusively use
that account for loan repayments.
Cause
The Village Did not interpret the requirement to have a separate loan repayment account but had
a separate bank account to be used solely for the sanitary sewer project.
Effect
This caused the Village to not be in compliance with grant requirements.
88
VILLAGE OF KEY BISCAYNE, FLORIDA
SCHEDULE OF FINDINGS AND QUESTIONED COSTS
FISCAL YEAR ENDED SEPTEMBER 30, 2010
Recommendation
We recommend the Village establish a separate Loan Debt Service account with a depository
institution in order to comply with requirements of the loan agreement. If not, the Village must
contact the Florida Department of Environmental Protection as instructed in the loan agreement
in order to communicate such failure.
View of Responsible Officials and Planned Corrective Actions
In August 2008, the Village opened a public funds checking account in anticipation of the State
Revolving Loan Fund (SRLF) proceeds. The account was titled “Village of Key Biscayne Sewer
Enterprise Fund” and is used exclusively to report and monitor the activity within the Sanitary
Sewer Project. Currently, the project is in the final close out stage and the only future
transactions will be the semi-annual SRLF payments. In light of this compliance finding, and in
order to meet the specific requirements of the contract, the Village will formally rename the
account “Village of Key Biscayne Loan Debt Service Account”.