HomeMy Public PortalAboutBrewster 2005 Report on the Examination of the Basic Financial Statements
TOWN OF BREWSTER, MASSACHUSETTS
REPORT ON EXAMINATION OF
BASIC FINANCIAL STATEMENTS
JUNE 30, 2005
TOWN OF BREWSTER, MASSACHUSETTS
REPORT ON EXAMINATION OF
BASIC FINANCIAL STATEMENTS
JUNE 30, 2005
TABLE OF CONTENTS
PAGE
Independent Auditor’s Report 1
Management’s Discussion and Analysis 2 – 8
Basic Financial Statements
Statement of Net Assets 9
Statement of Activities 10– 11
Governmental Funds – Balance Sheet 12
Governmental Funds – Statement of Revenues, Expenditures, and
Changes in Fund Balances
13
Reconciliation of the Governmental Funds Balance Sheet Total
Fund Balances to the Statement of Net Assets
14
Reconciliation of the Statements of Revenues, Expenditures, and
Changes in Fund Balances of Governmental Funds to the
Statement of Activities
15
General Fund – Statement of Revenues, Expenditures, and
Changes in Fund Balance – Budget and Actual
16
Proprietary Funds – Statement of Net Assets 17
Proprietary Funds – Statement of Revenues, Expenses, and
Changes in Fund Net Assets
18
Proprietary Funds – Statement of Cash Flows 19
Fiduciary Funds – Statement of Fiduciary Net Assets 20
Fiduciary Funds – Statement of Changes in Fiduciary Net Assets 21
Notes to Basic Financial Statements 22 – 48
R. E. BROWN & COMPANY
CERTIFIED PUBLIC ACCOUNTANTS
25 CEMETERY STREET – P. O. BOX 230
Mendon, Massachusetts 01756
Phone: (508) 478-3941 Fax: (508) 478-1779
INDEPENDENT AUDITOR’S REPORT
To the Honorable Board of Selectmen
Town of Brewster, Massachusetts
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 Town of Brewster,
Massachusetts, as of and for the year ended June 30, 2005, which collectively comprise the Town of Brewster,
Massachusetts’ basic financial statements as listed in the table of contents. These financial statements are the
responsibility of Town of Brewster, Massachusetts’ 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. Those standards require that we plan and perform the audit to obtain reasonable assurance about
whether the financial statements are free of material misstatement. An audit includes examining, on a test basis,
evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the
accounting principles used and significant estimates made by management, as well as evaluating the overall
financial statement presentation. We believe that our audit provides a reasonable basis for our opinions.
In our opinion, the financial statements referred to above present fairly, in all material respects, the respective
financial position of the governmental activities, the business-type activities, each major fund, and the aggregate
remaining fund information of the Town of Brewster, Massachusetts as of June 30, 2005, and the respective
changes in 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.
The management’s discussion and analysis on pages 2 through 8 is not a required part of the basic financial
statements but is 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.
R. E. Brown & Company
April 21, 2006
Management’s Discussion and Analysis
As management of the Town of Brewster (the “Town”), we offer readers of these basic financial statements this
narrative overview and analysis of the financial activities for the fiscal year ended June 30, 2005. This is the
second year our financial statements have been prepared under the Governmental Accounting Standards Board
Statement Number 34 – Basic Financial Statements and Management’s Discussion and Analysis for State and
Local Governments. We encourage readers to consider the information presented in this report.
Financial Highlights
• The assets of the Town exceeded its liabilities at the close of the fiscal year by $68.1 million (net assets). Of
this amount, $15.7 million is considered unrestricted (unrestricted net assets).
• The unrestricted net assets of the Town’s governmental activities are $11.8 million and may be used to meet
the government’s ongoing obligations to citizens and creditors. The unrestricted net assets of the Town’s
business-type activities are $3.9 million and may be used to meet the ongoing obligations of the Town’s water
and golf department business-type activities.
• The government’s total net assets increased by $884 thousand, or 1.32%, in fiscal 2005. Within this total, net
assets of governmental activities increased by $399 thousand, a .71% increase from fiscal 2004. Also, net
assets of business-type activities increased by $485 thousand or 4.54% from 2004.
• At June 30, 2005, the Town’s governmental funds had a combined ending fund balance of $8.8 million. The
combined governmental funds balance decreased by $464 thousand a 5% decrease from the prior year’s
ending fund balance.
• The Town’s general fund reported a fund balance of $4.15 million at the end of fiscal 2005. The unreserved
fund balance for the general fund was $2.88 million or 10.9% of total general fund expenditures. There was a
$291 thousand decrease in total general fund balance for the year. A total of $413 thousand of the unreserved
fund balance was designated for funding the fiscal year 2006 budget.
• The total cost of all Town services for fiscal 2005 was $32.2 million, $27.9 million of which was for
governmental activities, and $4.3 million of which was for business-type activities.
• The Town issued bond anticipation notes for two land acquisition purchases totaling $1.270 million, two
water projects totaling $235 thousand, and $800,000 for a golf course irrigation project.
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Overview of the Financial Statements
This discussion and analysis is intended to serve as an introduction to the Town’s basic financial statements.
These basic financial statements are comprised of three components:
1. Government-wide Financial Statements
2. Fund Financial Statements
3. Notes to the Basic Financial Statements
Government-wide Financial Statements – The government-wide financial statements are designed to provide
readers with a broad overview of finances, in a manner similar to private-sector business.
The statement of net assets presents information on all assets and liabilities, with the difference between the two
reported as net assets. Over time, increases or decreases in net assets may serve as a useful indicator of whether
the financial position is improving or deteriorating.
The statement of activities presents information showing how the government’s net assets changed during the
most recent fiscal year. All changes in net assets are reported as soon as the underlying event giving rise to the
change occurs, regardless of the timing of related cash flows. Thus, revenues and expenses are reported in this
statement for some items that will only result in cash flows in future periods, (e.g., uncollected taxes and earned
but unused vacation/sick leave).
Both of the government-wide financial statements distinguish functions 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 or charges (business-type activities). The governmental
activities include general government, public safety, education, public works, human services, culture and
recreation, employee benefits, debt service, and state and county assessments. The business-type activities
include water and golf department services.
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. Fund accounting is used to ensure and
demonstrate compliance with finance related legal requirements. All of the funds can be divided into three main
categories: governmental funds, proprietary funds and fiduciary funds.
Governmental Funds – governmental funds are used to account for essentially the same functions reported as
governmental activities in the government-wide financial statements. However, unlike the government-wide
financial statements, governmental fund statements focus on near-term inflows and outflows of spendable
resources, as well as on balances of spendable resources available at the end of the fiscal year. Such information
may be useful in evaluating a government’s near-term financing requirements.
Because the focus of governmental funds is narrower than that of the government-wide financial statements, it is
useful to compare the information presented for governmental funds with similar information presented for
governmental activities in the government-wide financial statements. By doing so, readers may better understand
the long-term impact of the government’s near-term financing decisions. Both, the Governmental Funds Balance
Sheet and the Governmental Funds Statement of Revenues, Expenditures and Changes in Fund Balances provide
a reconciliation to facilitate this comparison between governmental funds and governmental activities.
The Town of Brewster adopts an annual appropriated budget for its general fund. A budgetary comparison
statement has been provided for the general fund to demonstrate compliance with this budget.
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Proprietary Funds – Enterprise funds are used to report the same functions presented as business-type activities
in the government-wide financial statements. The Town has two enterprise funds:
¾ Water Enterprise Fund accounts for the water activity of the Town.
¾ Golf Enterprise Fund accounts for the golf activity of the Town.
Fiduciary Funds – Fiduciary funds are used to account for resources held for the benefit of parties outside the
government. Fiduciary funds are not reflected in the government-wide financial statement, as the resources of
those funds are not available to support the Town’s own programs. The accounting used for fiduciary funds is
much like that used for proprietary funds.
Private-purpose trust funds and agency funds are each reported and combined into a single, aggregate presentation
in the fiduciary fund financial statements under the captions “private purpose trust funds” and “agency funds”,
respectively.
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.
Government-wide Financial Analysis:
The chart on the following page summarizes key financial components of the Town’s financial statements.
As noted earlier, assets exceed liabilities by $68,104,804 at the close of fiscal year 2005. The Town is able to
report positive balances in all categories of net assets, both for the government as a whole, and for its separate
governmental and business-type activities.
The largest component of the Town’s net assets are its investment in capital assets (e.g., land, buildings,
machinery, and equipment), less any related outstanding debt used to acquire those assets, is $49,690,502, or
72.96% of total net assets. The Town uses these capital assets to provide services to citizens; consequently, these
assets are not available for future spending. Although the investment in the Town’s capital assets is reported net
of its related debt, it should be noted that the resources needed to repay this debt must be provided from other
sources, since the capital assets themselves cannot be used to liquidate these liabilities.
The second largest component of the Town’s net assets are its unrestricted net assets totaling $15,708,995
(23.07%), which may be used to meet the government’s ongoing obligations to its citizens and creditors.
The Town’s total liabilities decreased by $48,440 over fiscal 2004, while total net assets increased by $4,684,246,
or 7.39%. Net assets of governmental activities increased by $4,199,239, a 7.96% increase from fiscal 2004.
These increases are primarily the result of a prior period adjustment of $3,800,178 to beginning balance of the
governmental activities fixed assets. Net assets of business-type activities increased by $485,007 or 4.54% from
2004. There was an increase of $228,734 in net assets reported in connection with the water business-type
activities, and an increase of $256,273 in net assets in connection with the golf department business-type activity,
respectively.
An additional portion of the net assets totaling $2,705,307 (3.97%) represents resources that are subject to
external restrictions on how they may be used.
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Increase Increase Increase
FY 2005 FY 2004 (Decrease) FY 2005 FY 2004 (Decrease) FY 2005 FY 2004 (Decrease)
Assets:
Current Assets 13,173,995$ 12,578,181$ 595,814$ 4,316,529$ 4,089,020$ 227,509$ 17,490,524$ 16,667,201$ 823,323$
Noncurrent Assets (excluding capital)6,693,246 7,099,950 (406,704) 73,206 63,315 9,891 6,766,452 7,163,265 (396,813)
Capital Assets 49,482,743 45,817,505 3,665,238 19,780,498 19,236,440 544,058 69,263,241 65,053,945 4,209,296
Total Assets 69,349,984 65,495,636 3,854,348 24,170,233 23,388,775 781,458 93,520,217 88,884,411 4,635,806
Liabilities:
Current Liabilities (excluding debt)1,539,753 1,328,744 211,009 157,204 130,753 26,451 1,696,957 1,459,497 237,460
Noncurrent Liabilities (excluding debt)625,000 1,300,000 (675,000) - - - 625,000 1,300,000 (675,000)
Current Debt 2,060,425 1,150,900 909,525 1,745,000 765,000 980,000 3,805,425 1,915,900 1,889,525
Noncurrent Debt 8,178,031 8,968,456 (790,425) 11,110,000 11,820,000 (710,000) 19,288,031 20,788,456 (1,500,425)
Total Liabilities 12,403,209 12,748,100 (344,891) 13,012,204 12,715,753 296,451 25,415,413 25,463,853 (48,440)
Net Assets:
Capital Assets Net of Related Debt 42,432,619 38,677,623 3,754,996 7,257,883 6,365,073 892,810 49,690,502 45,042,696 4,647,806
Restricted 2,705,307 2,187,441 517,866 - - - 2,705,307 2,187,441 517,866
Unrestricted 11,808,849 11,882,472 (73,623) 3,900,146 4,307,949 (407,803) 15,708,995 16,190,421 (481,426)
Total Net Assets 56,946,775$ 52,747,536$ 4,199,239$ 11,158,029$ 10,673,022$ 485,007$ 68,104,804$ 63,420,558$ 4,684,246$
Revenues
Program Revenues:
Charges for Services 1,709,252$ 1,643,218$ 66,034$ 5,476,243$ 5,348,506$ 127,737$ 7,185,495$ 6,991,724$ 193,771$
Operating Grants and Contributions 2,660,059 2,676,835 (16,776) 70,496 73,283 (2,787) 2,730,555 2,750,118 (19,563)
Capital Grants and Contributions 999,720 1,057,258 (57,538) - - - 999,720 1,057,258 (57,538)
General Revenues:
Real Estate and Personal Property Taxes 19,183,312 18,625,159 558,153 - - - 19,183,312 18,625,159 558,153
Tax Liens 42,114 81,146 (39,032) - - - 42,114 81,146.00 (39,032)
Motor Vehicle and Other Excise Taxes 1,412,291 1,158,136 254,155 - - - 1,412,291 1,158,136 254,155
Hotel/Motel Tax 499,942 495,506 4,436 - - - 499,942 495,506 4,436
Penalties and Interest on Taxes 96,858 107,134 (10,276) - - - 96,858 107,134 (10,276)
Payments in Lieu of Taxes 6,800 6,841 (41) - - - 6,800 6,841 (41)
Nonrestricted Grants and Contributions 608,614 488,969 119,645 - - - 608,614 488,969 119,645
Unrestricted Investment Income 204,346 157,465 46,881 - - - 204,346 157,465 46,881
Other Revenues 54,537 9,642 44,895 - - - 54,537 9,642 44,895
Total Revenues 27,477,845 26,507,309 970,536 5,546,739 5,421,789 124,950 33,024,584 31,929,098 1,095,486
Expenses:
General Government 3,109,646 2,306,125 803,521 - - - 3,109,646 2,306,125 803,521
Public Safety 3,878,292 3,565,708 312,584 - - - 3,878,292 3,565,708 312,584
Education 14,853,060 13,813,786 1,039,274 - - - 14,853,060 13,813,786 1,039,274
Public Works 1,131,011 2,375,538 (1,244,527) - - - 1,131,011 2,375,538 (1,244,527)
Human Services 456,648 507,190 (50,542) - - - 456,648 507,190 (50,542)
Culture and Recreation 635,844 671,451 (35,607) - - - 635,844 671,451 (35,607)
Employee Benefits 2,926,385 2,676,506 249,879 - - - 2,926,385 2,676,506 249,879
State and County Assessments 401,778 432,076 (30,298) - - - 401,778 432,076 (30,298)
Interest 472,547 507,471 (34,924) - - - 472,547 507,471 (34,924)
Golf - - - 2,767,761 2,754,417 13,344 2,767,761 2,754,417 13,344
Water - - - 1,507,544 1,342,360 165,184 1,507,544 1,342,360 165,184
Total Expenses 27,865,211 26,855,851 1,009,360 4,275,305 4,096,777 178,528 32,140,516 30,952,628 1,187,888
Transfers 786,427 885,036 (98,609) (786,427) (885,036) 98,609 - - -
Change in Net Assets 399,061 536,494 (137,433) 485,007 439,976 45,031 884,068 976,470 (92,402)
Net Assets - Beginning 56,547,714 52,211,042 4,336,672 10,673,022 10,233,046 439,976 67,220,736 62,444,088 4,776,648
Net Assets - Ending 56,946,775$ 52,747,536$ 4,199,239$ 11,158,029$ 10,673,022$ 485,007$ 68,104,804$ 63,420,558$ 4,684,246$
TOWN of BREWSTER - FINANCIAL HIGHLIGHTS
Governmental
Activities
Business-type
Activities
Total
Primary Government
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Financial analysis of the Government’s Funds
As noted earlier, the Town uses fund accounting to ensure and demonstrate compliance with finance-related legal
requirements.
Governmental funds – The focus of governmental funds is to provide information on near-term inflows, outflows,
and balances of spendable resources. Such information is useful in assessing financing requirements. In
particular, unreserved fund balance may serve as a useful measure of a government’s net resources available for
spending at the end of the fiscal year.
As of the end of the current fiscal year, governmental funds reported combined ending fund balances of
$8,776,450 a $464 thousand decrease from the prior year’s ending fund balances.
The general fund is the primary operating fund. At the end of the current fiscal year, unreserved fund balance of
the general fund was $2,884,231, while total fund balance stood at $4,152,811. As a measure of the general
fund’s liquidity, it may be useful to compare both unreserved fund balance and total fund balance to total fund
expenditures. Unreserved fund balance represents 10.85% of total general fund expenditures, while total fund
balance represents 15.62% of that same amount.
The stabilization fund has accumulated a fund balance of $1,899,453, which represents 7.15% of general fund
expenditures. These funds can be used for general or capital purposes upon Town Meeting approval.
General Fund Budget Highlights
During the fiscal year the operating budget was amended by $939,137 at two Special Town Meetings to fund
wage settlements, land acquisition, capital equipment purchases for education, public safety and public works,
and road maintenance and drainage projects. The Town budgeted $24.1 million in revenues and $27.8 in
expenditures, drawing on transfers and prior year’s surplus to finance the difference. At year end, $379,986 of
unexpended appropriation balances was closed out to undesignated fund balance.
Capital Asset and Debt Administration
Capital Assets - In conjunction with the operating budget, the Town annually prepares capital budgets for the
upcoming fiscal year.
The Town’s investment in capital assets for governmental and business-type activities, as summarized below, as
of June 30, 2005, amounts to $69,263,241, net of accumulated depreciation. The investment in capital assets
includes land, buildings, machinery and equipment, vehicles, infrastructure, and construction in progress.
The governmental activities capital assets (net of accumulated depreciation) decreased by $134,940 during the
current fiscal year while the business-type activities capital assets (net of accumulated depreciation) increased by
$544,059. Total depreciation was $1.89 million, resulting in a total government-wide increase to capital assets
(net of accumulated depreciation) of $409,119.
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Increase Increase Increase
FY 2005 FY 2004 (Decrease) FY 2005 FY 2004 (Decrease) FY 2005 FY 2004 (Decrease)
Land 28,037,512$ 28,037,512$ -$ 2,874,212$ 2,874,212$ -$ 30,911,724$ 30,911,724$ -$
Buildings and improvements 17,364,578 17,937,757 (573,179) 2,064,352 2,125,932 (61,580) 19,428,930 20,063,689 (634,759)
Improvements (other than buildings) 613,662 22,944 590,718 - - - 613,662 22,944 590,718
Machinery, Equipment, and Vehicles 1,498,541 1,447,804 50,737 692,743 784,615 (91,872) 2,191,284 2,232,419 (41,135)
Infrastructure 1,968,450 2,171,666 (203,216) 13,970,333 13,451,681 518,652 15,938,783 15,623,347 315,436
Construction in Progress - - - 178,858 - 178,858 178,858 - 178,858
Total Capital Assets 49,482,743$ 49,617,683$ (134,940)$ 19,780,498$ 19,236,440$ 544,058$ 69,263,241$ 68,854,123$ 409,118$
Capital Assets
(Net of Depreciation)
Governmental
Activities
Business-type
Activities
Total
Primary
Government
Long Term Debt - The Town’s debt burden is reasonable in relation to other communities its size. Outstanding
long-term debt, as of June 30, 2005, totaled $20,788,456. Within this total, business-type activities have debt of
$11,820,000 that is fully supported by their respective program revenues, and governmental activities debt is
$8,968,456. Total debt consists of the following:
Outstanding Outstanding
Governmental Activities June 30, 2005 June 30, 2004
School Construction 4,650,000$ 5,075,000$
Library Construction 550,000 600,000
MWPAT Title V - Sewer 166,202 176,602
Road Betterments - Blueberry Rd 62,000 77,500
Road Betterments - Beach Plum Rd 75,000 90,000
Police Station 2,550,000 2,720,000
Road Betterments - Highlands Rd 70,000 85,000
Road Betterments - Millstone Rd 225,000 255,000
Road Betterments - Commons Way Rd 180,000 205,000
Road Betterments - Meetinghouse Rd 255,000 280,000
MWPAT #97-1156 Title V - Sewer 185,254 185,254
Total Governmental Activities 8,968,456$ 9,749,356$
Outstanding Outstanding
Business-type Activities June 30, 2005 June 30, 2004
Golf Course 8,260,000$ 8,615,000$
Water Mains 2,275,000 2,430,000
Telemetry System 95,000 120,000
Water Betterments - Sears Road 10,000 15,000
Water Betterments - Williams Drive 30,000 35,000
Standpipe #2 500,000 575,000
Standpipe Rehabilitation 650,000 725,000
Total Business-type Activities 11,820,000$ 12,515,000$
Grand Total - All long-term debt 20,788,456$ 22,264,356$
Outstanding Debt at Year End
Please refer to Notes 5 and 8 for further discussion of the major capital and debt activity.
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Economic Factors and Next Year’s Budgets and Rates
• Increased funding of State Aid in the areas of Chapter 70, State Owned Land and Lottery Aid increased
by 10% in total, or $135,600 in FY06.
• The Town Meeting voted to institute the Modified Community Preservation Act from the former Land
Bank in FY2006, resulting in a first year surcharge match of $571,000.
• Brewster’s allocation of CPA revenues are 50% for Open Space, 10% for Community Housing and 10%
for Historic Preservation.
• The Fiscal Year 2006 Tax Rate was set at $5.58, a decrease of $.48 cents and resulted in approximately
the same level of services without the need for a general override under Proposition 2 ½.
• The Board of Selectmen voted during their classification hearing to maintain the same tax rate for all
classes of property.
• Over one million dollars was spent on Improvements to both Private and Town Owned Roads.
• Health Care and Pension Costs continue to rise, although for FY06 the increase was manageable.
• GASB 45 required the public to be educated on Post Retirement Benefits and the funding requirements
that will be imposed on the Town, ultimately being funded with tax dollars.
• In FY06 the Town received MSBA reimbursement for an elementary school roof renovation project.
These funds, or a portion thereof, may be used to initially fund requirements under GASB45.
Request for Information
This financial report is designed to provide a general overview of the Town of Brewster’s finances for all those
with an interest in the government’s finances. Questions concerning any of the information provided in this
report or request for additional financial information should be addressed to the Finance Director, 2198 Main
Street, Brewster, MA 02631.
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GOVERNMENTAL BUSINESS-TYPE
ACTIVITIES ACTIVITIES TOTAL
ASSETS
CURRENT:
CASH AND SHORT-TERM INVESTMENTS 11,427,491$ 4,255,688$ 15,683,179$
RECEIVABLES, NET OF ALLOWANCE FOR UNCOLLECTIBLES:
REAL ESTATE AND PERSONAL PROPERTY TAXES 226,808 - 226,808
TAX LIENS 385,441 - 385,441
MOTOR VEHICLE EXCISE TAXES 106,395 - 106,395
USER FEES - 55,173 55,173
DEPARTMENTAL AND OTHER 476,500 - 476,500
INTERGOVERNMENTAL 464,110 - 464,110
SPECIAL ASSESSMENTS 87,250 5,668 92,918
NONCURRENT:
RECEIVABLES, NET OF ALLOWANCE FOR UNCOLLECTIBLES:
INTERGOVERNMENTAL 6,258,390 - 6,258,390
SPECIAL ASSESSMENTS 434,856 73,206 508,062
CAPITAL ASSETS, NET OF ACCUMULATED DEPRECIATION 49,482,743 19,780,498 69,263,241
TOTAL ASSETS 69,349,984 24,170,233 93,520,217
LIABILITIES
CURRENT:
WARRANTS PAYABLE 1,412,099 58,083 1,470,182
OTHER LIABILITIES 8,460 13,259 21,719
ACCRUED INTEREST 94,194 85,862 180,056
BONDS AND NOTES PAYABLE 2,060,425 1,745,000 3,805,425
LANDFILL POSTCLOSURE CARE COSTS 25,000 - 25,000
NONCURRENT:
BONDS AND NOTES PAYABLE 8,178,031 11,110,000 19,288,031
LANDFILL POSTCLOSURE CARE COSTS 625,000 - 625,000
TOTAL LIABILITIES 12,403,209 13,012,204 25,415,413
NET ASSETS
INVESTED IN CAPITAL ASSETS, NET OF RELATED DEBT 42,432,619 7,257,883 49,690,502
RESTRICTED FOR:
STREETS 459,593 - 459,593
PERMANENT FUNDS:
EXPENDABLE 84,045 - 84,045
NONEXPENDABLE 94,738 - 94,738
OTHER PURPOSES 2,066,931 - 2,066,931
UNRESTRICTED 11,808,849 3,900,146 15,708,995
TOTAL NET ASSETS 56,946,775$ 11,158,029$ 68,104,804$
See accompanying notes to the basic financial statements
TOWN OF BREWSTER, MASSACHUSETTS
STATEMENT OF NET ASSETS
JUNE 30, 2005
PRIMARY GOVERNMENT
- 9 -
OPERATING CAPITALCHARGES FOR GRANTS AND GRANTS AND NET (EXPENSE)FUNCTIONS/PROGRAMSEXPENSES SERVICES CONTRIBUTIONS CONTRIBUTIONS REVENUEPRIMARY GOVERNMENT:GOVERNMENTAL ACTIVITIES:GENERAL GOVERNMENT 3,109,646$ 212,576$ 43,868$ 611,022$ (2,242,180)$ PUBLIC SAFETY 3,878,292 360,626 853,960 - (2,663,706) EDUCATION 14,853,060 112,504 1,139,738 - (13,600,818) PUBLIC WORKS 1,131,011 722,098 129,200 378,103 98,390 HUMAN SERVICES 456,648 86,322 103,283 10,595 (256,448) CULTURE & RECREATION 635,844 215,126 81,696 - (339,022) EMPLOYEE BENEFITS 2,926,385 - 308,314 - (2,618,071) STATE & COUNTY ASSESSMENTS 401,778 - - - (401,778) INTEREST 472,547 - - - (472,547) TOTAL GOVERNMENTAL ACTIVITIES 27,865,211 1,709,252 2,660,059 999,720 (22,496,180) BUSINESS-TYPE ACTIVITIES:GOLF 2,767,761 3,628,654 2,135 - 863,028 WATER 1,507,544 1,847,589 68,361 - 408,406 TOTAL BUSINESS-TYPE ACTIVITIES 4,275,305 5,476,243 70,496 - 1,271,434 TOTAL PRIMARY GOVERNMENT 32,140,516$ 7,185,495$ 2,730,555$ 999,720$ (21,224,746)$ (continued)See accompanying notes to the basic financial statements TOWN OF BREWSTER, MASSACHUSETTSSTATEMENT OF ACTIVITIESFISCAL YEAR ENDED JUNE 30, 2005PROGRAM REVENUES- 10 -
GOVERNMENTAL BUSINESS-TYPEACTIVITIESACTIVITIES TOTALCHANGES IN NET ASSETS:NET (EXPENSE) REVENUE FROM PREVIOUS PAGE (22,496,180)$ 1,271,434$ (21,224,746)$ GENERAL REVENUES:REAL ESTATE AND PERSONAL PROPERTY TAXES,NET OF TAX REFUNDS PAYABLE 19,183,312 - 19,183,312 TAX LIENS 42,114 - 42,114 MOTOR VEHICLE AND OTHER EXCISE TAXES 1,412,291 - 1,412,291 HOTEL/MOTEL TAX 499,942 - 499,942 PENALTIES AND INTEREST ON TAXES 96,858 - 96,858 PAYMENTS IN LIEU OF TAXES 6,800 - 6,800 GRANTS AND CONTRIBUTIONS NOT RESTRICTEDTO SPECIFIC PROGRAMS 608,614 - 608,614 UNRESTRICTED INVESTMENT INCOME 204,346 - 204,346 MISCELLANEOUS 54,537 - 54,537 TRANSFERS, NET 786,427 (786,427) - TOTAL GENERAL REVENUES AND TRANSFERS 22,895,241 (786,427) 22,108,814 CHANGE IN NET ASSETS 399,061 485,007 884,068 NET ASSETS:BEGINNING OF YEAR56,547,714 10,673,022 67,220,736 END OF YEAR56,946,775$ 11,158,029$ 68,104,804$ (concluded)See accompanying notes to the basic financial statements TOWN OF BREWSTER, MASSACHUSETTSSTATEMENT OF ACTIVITIESFISCAL YEAR ENDED JUNE 30, 2005PRIMARY GOVERNMENT- 11 -
TOWN OF BREWSTER, MASSACHUSETTSGOVERNMENTAL FUNDSBALANCE SHEETJUNE 30, 2005 NONMAJORTOTALLAND STABILIZATION GOVERNMENTAL GOVERNMENTALASSETSGENERALBANKFUND FUNDS FUNDSCASH AND SHORT-TERM INVESTMENTS 5,478,337$ 551,329$ 1,899,453$ 3,498,372$ 11,427,491$ RECEIVABLES, NET OF ALLOWANCE FOR UNCOLLECTIBLES:REAL ESTATE AND PERSONAL PROPERTY TAXES 226,808 - - - 226,808 TAX LIENS 385,441 - - - 385,441 MOTOR VEHICLE EXCISE TAXES 106,395 - - - 106,395 DEPARTMENTAL AND OTHER - 12,236 - 464,264 476,500 INTERGOVERNMENTAL 6,258,390 - - 464,110 6,722,500 SPECIAL ASSESSMENTS - - - 522,106 522,106 TOTAL ASSETS12,455,371$ 563,565$ 1,899,453$ 4,948,852$ 19,867,241$ LIABILITIES AND FUND BALANCESLIABILITIES:WARRANTS PAYABLE 1,352,067$ -$ -$ 60,032$ 1,412,099$ OTHER LIABILITIES 8,460 - - - 8,460 DEFERRED REVENUES 6,942,033 12,236 - 1,445,963 8,400,232 NOTES PAYABLE - 1,270,000 - - 1,270,000 TOTAL LIABILITIES8,302,560 1,282,236 - 1,505,995 11,090,791 FUND BALANCES:RESERVED FOR:ENCUMBRANCES AND CONTINUING APPROPRIATIONS 1,268,580 - - - 1,268,580 PERPETUAL PERMANENT FUNDS - - - 94,738 94,738 UNRESERVEDDESIGNATED FOR SUBSEQUENT YEARS' EXPENDITURES 412,810 - - - 412,810 UNDESIGNATED REPORTED IN:GENERAL FUND 2,471,421 - - - 2,471,421 SPECIAL REVENUE FUNDS - - 1,899,453 2,526,524 4,425,977 CAPITAL PROJECTS FUNDS - (718,671) - 737,550 18,879 PERMANENT FUNDS - - - 84,045 84,045 TOTAL FUND BALANCES4,152,811 (718,671) 1,899,453 3,442,857 8,776,450 TOTAL LIABILITIES AND FUND BALANCES12,455,371$ 563,565$ 1,899,453$ 4,948,852$ 19,867,241$ See accompanying notes to the basic financial statements - 12 -
NONMAJOR TOTALLAND STABILIZATION GOVERNMENTAL GOVERNMENTALGENERAL BANK FUND FUNDS FUNDSREVENUES:REAL ESTATE AND PERSONAL PROPERTY TAXES,NET OF TAX REFUNDS 19,199,077$ -$ -$ -$ 19,199,077$ MOTOR VEHICLE AND OTHER EXCISE TAXES 1,357,662 - - - 1,357,662 INTERGOVERNMENTAL 2,517,690 - - 361,739 2,879,429 PAYMENTS IN LIEU OF TAXES 6,800 - - - 6,800 PENALTIES & INTEREST 75,158 - - - 75,158 FINES & FORFEITS 39,927 - - - 39,927 CHARGES FOR SERVICES 739,526 - - 1,282,618 2,022,144 HOTEL/MOTEL TAX 499,942 - - - 499,942 INVESTMENT INCOME 146,272 35,624 43,539 20,186 245,621 CONTRIBUTIONS AND DONATIONS - - - 50,364 50,364 DEPARTMENTAL AND OTHER 878,709 573,599 - 139,912 1,592,220 TOTAL REVENUES 25,460,763 609,223 43,539 1,854,819 27,968,344 EXPENDITURES:CURRENT:GENERAL GOVERNMENT 1,874,506 1,270,000 - 55,349 3,199,855 PUBLIC SAFETY 3,948,771 - - 91,678 4,040,449 EDUCATION 13,853,081 - - 918,018 14,771,099 PUBLIC WORKS 1,386,332 - - 168,973 1,555,305 HUMAN SERVICES 398,132 - - 58,516 456,648 CULTURE & RECREATION 528,770 - - 77,435 606,205 EMPLOYEE BENEFITS 2,926,385 - - - 2,926,385 STATE & COUNTY ASSESSMENTS 401,778 - - - 401,778 DEBT SERVICE 1,261,406 - - - 1,261,406 TOTAL EXPENDITURES 26,579,161 1,270,000 - 1,369,969 29,219,130 EXCESS (DEFICIENCY) OF REVENUES OVER EXPENDITURES(1,118,398) (660,777) 43,539 484,850 (1,250,786) OTHER FINANCING SOURCES (USES)OPERATING TRANSFERS IN 1,697,315 - 600,000 720,000 3,017,315 OPERATING TRANSFERS OUT (870,000) - (450,000) (910,888) (2,230,888) TOTAL OTHER FINANCING SOURCES (USES) 827,315 - 150,000 (190,888) 786,427 NET CHANGE IN FUND BALANCES(291,083) (660,777) 193,539 293,962 (464,359) FUND BALANCES AT BEGINNING OF YEAR4,443,894 (57,894) 1,705,914 3,148,895 9,240,809 FUND BALANCES AT END OF YEAR4,152,811$ (718,671)$ 1,899,453$ 3,442,857$ 8,776,450$ See accompanying notes to the basic financial statements TOWN OF BREWSTER, MASSACHUSETTSGOVERNMENTAL FUNDSSTATEMENT OF REVENUES, EXPENDITURES, AND CHANGES IN FUND BALANCESFISCAL YEAR ENDED JUNE 30, 2005- 13 -
TOTAL GOVERNMENTAL FUND BALANCES 8,776,450$
CAPITAL ASSETS (NET) USED IN GOVERNMENTAL ACTIVITIES ARE NOT FINANCIAL RESOURCES
AND, THEREFORE, ARE NOT REPORTED IN THE FUNDS 49,482,743
ACCOUNTS RECEIVABLE ARE NOT AVAILABLE TO PAY FOR CURRENT-PERIOD
EXPENDITURES AND, THEREFORE, ARE DEFERRED IN THE FUNDS 8,400,232
IN THE STATEMENT OF ACTIVITIES, INTEREST IS ACCRUED ON OUTSTANDING LONG-TERM DEBT,
WHEREAS IN GOVERNMENTAL FUNDS INTEREST IS NOT REPORTED UNTIL DUE (94,194)
LONG-TERM LIABILITIES ARE NOT DUE AND PAYABLE IN THE CURRENT PERIOD AND, THEREFORE,
ARE NOT REPORTED IN THE GOVERNMENTAL FUNDS
BONDS AND NOTES PAYABLE (8,968,456)
LANDFILL CLOSURE AND POSTCLOSURE CARE COSTS (650,000)
NET EFFECT OF REPORTING LONG-TERM LIABILITIES (9,618,456)
NET ASSETS OF GOVERNMENTAL ACTIVITIES 56,946,775$
See accompanying notes to the basic financial statements
TOWN OF BREWSTER, MASSACHUSETTS
RECONCILIATION OF THE GOVERNMENTAL FUNDS BALANCE SHEET
FISCAL YEAR ENDED JUNE 30, 2005
TOTAL FUND BALANCES TO THE STATEMENT OF NET ASSETS
- 14 -
NET CHANGE IN FUND BALANCES - TOTAL GOVERNMENTAL FUND (464,359)$
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.
CAPITAL OUTLAY 1,024,004
DEPRECIATION EXPENSE (1,158,944)
NET EFFECT OF REPORTING CAPITAL ASSETS (134,940)
REVENUES IN THE STATEMENT OF ACTIVITIES THAT DO NOT PROVIDE CURRENT FINANCIAL
RESOURCES ARE FULLY DEFERRED IN THE STATEMENT OF REVENUES, EXPENDITURES AND
CHANGES IN FUND BALANCES. THEREFORE, THE RECOGNITION OF REVENUE FOR VARIOUS
TYPES OF ACCOUNTS RECEIVABLE (I.E. REAL ESTATE AND PERSONAL PROPERTY, MOTOR
VEHICLE EXCISE, ETC.) DIFFER BETWEEN THE TWO STATEMENTS. THIS AMOUNT REPRESENTS
THE NET CHANGE IN DEFERRED REVENUE (490,499)
THE ISSUANCE OF LONG-TERM DEBT (E.G., BONDS) PROVIDES CURRENT FINANCIAL
RESOURCES TO GOVERNMENTAL FUNDS, WHILE THE REPAYMENT OF THE PRINCIPAL OF LONG-
TERM DEBT CONSUMES THE FINANCIAL RESOURCES OF GOVERNMENTAL FUNDS. NEITHER
TRANSACTION, HOWEVER, HAS ANY EFFECT ON NET ASSETS. ALSO, GOVERNMENTAL FUNDS
REPORT THE EFFECT OF ISSUANCE COSTS, PREMIUMS, DISCOUNTS, AND SIMILAR ITEMS WHEN
DEBT IS FIRST ISSUED, WHEREAS THESE AMOUNTS ARE DEFERRED AND AMORTIZED IN THE
STATEMENT OF ACTIVITIES.
DEBT SERVICE PRINCIPAL PAYMENTS 780,900
NET EFFECT OF REPORTING LONG-TEM DEBT 780,900
SOME EXPENSES REPORTED IN THE STATEMENT OF ACTIVITIES DO NOT REQUIRE THE USE OF
CURRENT FINANCIAL RESOURCES AND, THEREFORE, ARE NOT REPORTED AS EXPENDITURES
IN THE GOVERNMENTAL FUNDS.
NET CHANGE IN LANDFILL CLOSURE AND POSTCLOSURE CARE ACCRUAL 700,000
NET CHANGE IN ACCRUED INTEREST ON LONG-TERM DEBT 7,959
NET EFFECT OF RECORDING LONG-TERM LIABILITIES 707,959
CHANGE IN NET ASSETS OF GOVERNMENTAL ACTIVITIES 399,061$
See accompanying notes to the basic financial statements
TOWN OF BREWSTER, MASSACHUSETTS
RECONCILIATION OF THE STATEMENT OF REVENUES, EXPENDITURES, AND
CHANGES IN FUND BALANCES OF THE GOVERNMENTAL FUNDS TO THE STATEMENT OF ACTIVITIES
FISCAL YEAR ENDED JUNE 30, 2005
- 15 -
ACTUAL
ORIGINAL FINAL BUDGETARY VARIANCE
BUDGET BUDGET AMOUNTS OVER(UNDER)
REVENUES:
REAL ESTATE AND PERSONAL PROPERTY TAXES,
NET OF TAX REFUNDS 19,170,656$ 19,170,656$ 19,199,077$ 28,421$
MOTOR VEHICLE AND OTHER EXCISE TAXES 1,125,000 1,125,000 1,357,661 232,661
INTERGOVERNMENTAL 2,097,694 2,097,694 2,198,781 101,087
PAYMENTS IN LIEU OF TAXES 6,700 6,700 6,800 100
PENALTIES & INTEREST 46,000 46,000 75,158 29,158
FINES & FORFEITS 8,000 8,000 39,927 31,927
HOTEL/MOTEL TAX 420,000 420,000 499,942 79,942
INVESTMENT INCOME 50,000 50,000 146,272 96,272
DEPARTMENTAL AND OTHER 1,214,800 1,214,800 1,618,235 403,435
TOTAL REVENUES 24,138,850 24,138,850 25,141,853 1,003,003
EXPENDITURES:
CURRENT:
GENERAL GOVERNMENT 2,051,977 2,287,853 2,205,361 82,492
PUBLIC SAFETY 4,119,105 4,342,366 4,310,816 31,550
EDUCATION 14,019,452 14,034,452 13,963,413 71,039
PUBLIC WORKS 1,451,767 1,857,069 1,714,987 142,082
HUMAN SERVICES 398,125 443,173 434,936 8,237
CULTURE & RECREATION 535,826 540,326 537,017 3,309
EMPLOYEE BENEFITS 2,626,904 2,627,054 2,620,543 6,511
STATE & COUNTY ASSESSMENTS 437,396 437,396 401,778 35,618
DEBT SERVICE 1,278,216 1,288,216 1,273,400 14,816
TOTAL EXPENDITURES 26,918,768 27,857,905 27,462,251 395,654
EXCESS (DEFICIENCY) OF REVENUES OVER EXPENDITURES (2,779,918) (3,719,055) (2,320,398) 1,398,657
OTHER FINANCING SOURCES (USES):
OPERATING TRANSFERS IN 1,258,057 1,381,708 1,697,315 315,607
OPERATING TRANSFERS OUT (220,000) (870,000) (870,000) -
TOTAL OTHER FINANCING SOURCES (USES) 1,038,057 511,708 827,315 315,607
NET CHANGE IN FUND BALANCE (1,741,861) (3,207,347) (1,493,083) 1,714,264
BUDGETARY FUND BALANCE, BEGINNING OF YEAR 4,443,894 4,443,894 4,443,894 -
BUDGETARY FUND BALANCE, END OF YEAR 2,702,033$ 1,236,547$ 2,950,811$ 1,714,264$
See accompanying notes to the basic financial statements
BUDGETED AMOUNTS
TOWN OF BREWSTER, MASSACHUSETTS
GENERAL FUND
STATEMENT OF REVENUES, EXPENDITURES, AND CHANGES IN FUND BALANCE - BUDGET AND ACTUAL
YEAR ENDED JUNE 30, 2005
- 16 -
ASSETS GOLF WATER TOTAL
CURRENT:
CASH AND SHORT-TERM INVESTMENTS 903,182$ 3,352,506$ 4,255,688$
USER FEES, NET OF ALLOWANCE FOR UNCOLLECTIBLES: - 55,173 55,173
SPECIAL ASSESSMENTS - 5,668 5,668
TOTAL CURRENT ASSETS 903,182 3,413,347 4,316,529
NONCURRENT:
SPECIAL ASSESSMENTS - 73,206 73,206
CAPITAL ASSETS, NET OF ACCUMULATED DEPRECIATION 11,247,682 8,532,816 19,780,498
TOTAL NONCURRENT ASSETS 11,247,682 8,606,022 19,853,704
TOTAL ASSETS 12,150,864 12,019,369 24,170,233
LIABILITIES
CURRENT:
WARRANTS PAYABLE - 58,083 58,083
OTHER LIABILITIES - 13,259 13,259
ACCRUED INTEREST 17,760 68,102 85,862
BONDS AND NOTES PAYABLE 1,175,000 570,000 1,745,000
TOTAL CURRENT LIABILITIES 1,192,760 709,444 1,902,204
NONCURRENT:
BONDS AND NOTES PAYABLE 7,885,000 3,225,000 11,110,000
TOTAL LIABILITIES 9,077,760 3,934,444 13,012,204
NET ASSETS
INVESTED IN CAPITAL ASSETS, NET OF RELATED DEBT 2,187,682 5,070,201 7,257,883
UNRESTRICTED 885,422 3,014,724 3,900,146
TOTAL NET ASSETS 3,073,104$ 8,084,925$ 11,158,029$
See accompanying notes to the basic financial statements
BUSINESS-TYPE ACTIVITIES - ENTERPRISE FUNDS
TOWN OF BREWSTER, MASSACHUSETTS
PROPRIETARY FUNDS
STATEMENT OF NET ASSETS
JUNE 30, 2005
- 17 -
GOLF WATER TOTAL
OPERATING REVENUES:
CHARGES FOR SERVICES 3,628,654$ 1,847,589$ 5,476,243$
DEPARTMENTALAND OTHER 2,135 68,361 70,496
TOTAL OPERATING REVENUES 3,630,789 1,915,950 5,546,739
OPERATING EXPENSES:
GENERAL SERVICES 1,995,060 987,511 2,982,571
DEPRECIATION 365,237 334,036 699,273
TOTAL OPERATING EXPENSES 2,360,297 1,321,547 3,681,844
OPERATING INCOME (LOSS) 1,270,492 594,403 1,864,895
NON-OPERATING REVENUES (EXPENSES):
INTEREST EXPENSE (407,464) (185,997) (593,461)
TOTAL NON-OPERATING REVENUES (EXPENSES), NET (407,464) (185,997) (593,461)
INCOME (LOSS) BEFORE OPERATING TRANSFERS 863,028 408,406 1,271,434
OPERATING TRANSFERS:
OPERATING TRANSFERS OUT (606,755) (179,672) (786,427)
CHANGE IN NET ASSETS 256,273 228,734 485,007
NET ASSETS AT BEGINNING OF YEAR 2,816,831 7,856,191 10,673,022
NET ASSETS AT END OF YEAR 3,073,104$ 8,084,925$ 11,158,029$
See accompanying notes to the basic financial statements
BUSINESS TYPE ACTIVITIES - ENTERPRISE FUND
TOWN OF BREWSTER, MASSACHUSETTS
STATEMENT OF REVENUES, EXPENSES, AND CHANGES IN FUND NET ASSETS
FISCAl YEAR ENDED JUNE 30, 2005
PROPRIETARY FUNDS
- 18 -
TOWN OF BREWSTER, MASSACHUSETTS
PROPRIETARY FUNDS
STATEMENT OF CASH FLOWS
FISCAL YEAR ENDED JUNE 30, 2005
GOLF WATER TOTAL
CASH FLOWS FROM OPERATING ACTIVITIES:
RECEIPTS FROM CUSTOMERS AND USERS 3,630,789$ 1,907,749$ 5,538,538$
PAYMENTS TO SUPPLIERS (985,855) (451,167) (1,437,022)
PAYMENTS TO EMPLOYEES (1,009,205) (510,429) (1,519,634)
NET CASH PROVIDED (USED) BY OPERATING ACTIVITIES 1,635,729 946,153 2,581,882
CASH FLOWS FROM NONCAPITAL FINANCING ACTIVITIES:
OPERATING TRANSFERS OUT (606,755) (179,671) (786,426)
NET CASH PROVIDED (USED) BY NONCAPITAL FINANCING ACTIVITIES (606,755) (179,671) (786,426)
CASH FLOWS FROM CAPITAL AND RELATED FINANCING ACTIVITIES:
PROCEEDS FROM THE ISSUANCE OF BONDS AND NOTES 800,000 165,000 965,000
PRINCIPAL PAYMENTS ON BONDS AND NOTES (355,000) (340,000) (695,000)
ACQUISITION AND CONSTRUCTION OF CAPITAL ASSETS (1,078,101) (165,230) (1,243,331)
INTEREST EXPENSE (406,648) (186,278) (592,926)
NET CASH PROVIDED (USED) BY CAPITAL AND RELATED FINANCING ACTIVITIES (1,039,749) (526,508) (1,566,257)
NET INCREASE (DECREASE) IN CASH AND SHORT TERM INVESTMENTS (10,775) 239,974 229,199
CASH AND SHORT TERM INVESTMENTS - BEGINNING OF YEAR 913,957 3,112,532 4,026,489
CASH AND SHORT TERM INVESTMENTS- END OF YEAR 903,182$ 3,352,506$ 4,255,688$
RECONCILIATION OF OPERATING INCOME (LOSS)
TO NET CASH PROVIDED (USED) BY OPERATING ACTIVITIES:
OPERATING INCOME (LOSS)1,270,492$ 594,403$ 1,864,895$
ADJUSTMENTS TO RECONCILE OPERATING INCOME (LOSS)
TO NET CASH PROVIDED (USED) BY OPERATING ACTIVITIES:
DEPRECIATION 365,237 334,036 699,273
(INCREASE) DECREASE IN ACCOUNTS RECEIVABLE - (8,201) (8,201)
INCREASE (DECREASE) IN ACCOUNTS PAYABLE - 26,282 26,282
INCREASE (DECREASE) IN OTHER LIABILITIES - (367) (367)
TOTAL ADJUSTMENTS 365,237 351,750 716,987
NET CASH PROVIDED (USED) BY OPERATING ACTIVITIES 1,635,729$ 946,153$ 2,581,882$
BUSINESS TYPE ACTIVITIES - ENTERPRISE FUND
See accompanying notes to the basic financial statements
- 19 -
TOWN OF BREWSTER, MASSACHUSETTS
FIDUCIARY FUNDS
STATEMENT OF FIDUCIARY NET ASSETS
JUNE 30, 2005
PRIVATE
PURPOSE AGENCY
TRUST FUNDS FUNDS
ASSETS
CASH AND SHORT-TERM INVESTMENTS 62,227$ 75,321$
DEPARTMENTAL - 4,991
TOTAL ASSETS 62,227 80,312
LIABILITIES
WARRANTS PAYABLE - 7,313
OTHER LIABILITIES - 72,999
TOTAL LIABILITIES - 80,312
NET ASSETS
HELD IN TRUST FOR OTHER PURPOSES 62,227$ -$
See accompanying notes to the basic financial statements
- 20 -
PRIVATE
PURPOSE
TRUST FUNDS
ADDITIONS:
INVESTMENT INCOME: 935$
DEDUCTIONS:
EDUCATIONAL SCHOLARSHIPS 1,000
CHANGE IN NET ASSETS (65)
NET ASSETS AT BEGINNING OF YEAR 62,292
NET ASSETS AT END OF YEAR 62,227$
See accompanying notes to the basic financial statements
TOWN OF BREWSTER, MASSACHUSETTS
STATEMENT OF CHANGES IN FIDUCIARY NET ASSETS
FISCAL YEAR ENDED JUNE 30, 2005
FIDUCIARY FUNDS
- 21 -
TOWN OF BREWSTER, MASSACHUSETTS
NOTES TO BASIC FINANCIAL STATEMENTS
JUNE 30, 2005
NOTE 1 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
The accompanying basic financial statements of the Town of Brewster, Massachusetts (the Town) have
been prepared in accordance with accounting principles generally accepted in the United States of
America (GAAP). The Governmental Accounting Standards Board (GASB) is the recognized standard-
setting body for establishing governmental accounting and financial reporting principles. The following is
a summary of the more significant Town accounting policies:
A. Reporting Entity
Primary Government
The Town is a municipal corporation that is governed by an elected five member Board of Selectmen (the
Board). The Board is responsible for appointing a Town Administrator whose responsibility is to manage
the day to day operations. For financial reporting purposes, the Town has included all funds,
organizations, account groups, agencies, boards, commissions and institutions. The Town has also
considered all potential component units, blended or discretely presented, for which it is financially
accountable as well as other organizations for which the nature and significance of their relationship with
the Town are such that exclusion would cause the basic financial statements to be misleading or
incomplete. Blended component units, although legally separate entities, are, in substance, part of the
government’s operations and discretely presented component units are reported in a separate column in
the government-wide financial statements to emphasize that they are legally separate from the
government. It has been determined that there are no component units (blended or discretely presented)
for inclusion in the primary government’s financial reporting entity.
Joint Ventures
Municipal joint ventures pool resources to share the costs, risks and rewards of providing services to their
participants, the general public or others. The Town is a participant in the following joint ventures:
Name Purpose Address
Annual
Assessment
Nauset Regional To provide education services 78 Eldredge Parkway $ 7,850,089
School District Orleans, MA 02653
Cape Cod Regional
Technical High
School
To provide vocational education 351 Pleasant Lake Ave
Harwich, MA 02645
$ 769,359
The Nauset Regional School District (the District) is governed by an eleven (11) member school
committee consisting of three (3) elected representatives from the Town of Brewster. The Town is
indirectly liable for debt and other expenditures of the District and is assessed annually for its share of the
operating and capital costs. Separate financial statements may be obtained by writing to the Treasurer of
the District at the above address. The Town has an approximately 48.69% equity interest in the joint
venture.
- 22 -
TOWN OF BREWSTER, MASSACHUSETTS
NOTES TO BASIC FINANCIAL STATEMENTS
JUNE 30, 2005
- 23 -
The Cape Cod Regional Technical High School is governed by a twenty-one (21) member school
committee consisting of two (2) elected representatives from the Town of Brewster. The Town is
indirectly liable for debt and other expenditures of the District and is assessed annually for its share of the
operating and capital costs. Separate financial statements may be obtained by writing to the Treasurer of
the District at the above address. The Town has no equity interest in the joint venture.
Pursuant to an inter-municipal agreement authorized by state statutes, the Town joined the Town of
Orleans, and the Town of Eastham to provide for sharing of the capital, operating and maintenance and
other costs of a Septic Treatment Facility (Tri-Town Septage Facility) for the mutual advantage of the
Towns. A three member Board of Managers for the joint venture is appointed for oversight purposes, such
Board consisting of the chairman of each Town’s Board of Selectmen. An annual budget for the operation
and management of the facility is prepared by the facility superintendent and submitted to the Board of
Managers.
B. Government-Wide and Fund Financial Statements
Government-Wide Financial Statements
The government-wide financial statements (i.e., statement of net assets and the statement of changes in
net assets) report information on all of the non-fiduciary activities of the primary government.
Governmental activities, which are primarily supported by taxes and intergovernmental revenues, are
reported separately from business-type activities, which are supported primarily by user fees and charges.
Fund Financial Statements
Separate financial statements are provided for governmental funds, proprietary funds, and fiduciary funds,
even though fiduciary funds 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. Nonmajor funds are aggregated and displayed in a single column.
Major Fund Criteria
A fund is considered major if it is the primary operating fund of the Town or it meets the
following criteria:
a. If the total assets, liabilities, revenues, or expenditures/expenses of an individual
governmental or enterprise fund are at least 10 percent of the corresponding element (assets,
liabilities, etc.) for all funds of that category or type (total governmental or total enterprise
funds), and
b. If the total assets, liabilities, revenues, or expenditures/expenses of the individual
governmental fund or enterprise fund are at least 5 percent of the corresponding element for
all governmental and enterprise funds combined.
Additionally, any other governmental or enterprise fund that management believes is particularly
significant to the basic financial statements may be reported as a major fund.
Fiduciary funds are reported by fund type.
TOWN OF BREWSTER, MASSACHUSETTS
NOTES TO BASIC FINANCIAL STATEMENTS
JUNE 30, 2005
- 24 -
C. Measurement Focus, Basis of Accounting and Financial Statement Presentation
Government-Wide Financial Statements
The government-wide financial statements are reported using the economic resources measurement focus
and the accrual basis of accounting. Under this method, revenues are recorded when earned and expenses
are recorded when the liabilities are incurred. Real estate and personal property taxes are recognized as
revenues in the fiscal 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.
The statement of activities demonstrates the degree to which the direct expenses of a particular 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 the following:
a. Charges to customers or applicants who purchase, use, or directly benefit from goods, services,
or privileges provided by a given function or segment.
b. Grants and contributions that are restricted to meeting the operational requirements of a
particular function or segment.
c. Grants and contributions that are restricted to meeting the capital requirements of a particular
function or segment.
Taxes and other items not identifiable as program revenues are reported as general revenues.
For the most part, the effect of interfund activity has been removed from the government-wide financial
statements. Exceptions are charges between the general fund and the various enterprise funds. Elimination
of these charges would distort the direct costs and program revenues reported for the functions affected.
Fund Financial Statements
Governmental Fund Financial Statements
Governmental fund financial statements are reported using the current financial resources measurement
focus and the modified accrual basis of accounting. Under the modified accrual basis of accounting,
revenues are recognized when susceptible to accrual (i.e., when they become both measurable and
available). Measurable means the amount of the transaction can be determined and available means
collectible within the current period or soon enough thereafter to pay liabilities of the current period.
Expenditures are recorded when the related fund liability is incurred, except for interest on general long-
term debt which is recognized when due, and the landfill post closure care costs, which is recognized
when the obligation is expected to be liquidated with current expendable available resources.
TOWN OF BREWSTER, MASSACHUSETTS
NOTES TO BASIC FINANCIAL STATEMENTS
JUNE 30, 2005
- 25 -
In applying the susceptible to accrual concept to intergovernmental revenues, there are essentially two
types of revenues. In one, moneys must be expended on the specific purpose or project before any
amounts will be paid to the Town; therefore, revenues are recognized based upon the expenditures
incurred. In the other, moneys are virtually unrestricted and are usually revocable only for failure to
comply with prescribed compliance requirements. These resources are reflected as revenues at the time of
receipt or earlier if the susceptible to accrual criteria are met.
The Town considers property taxes as available if they are due and collected within 60 days after fiscal
year-end. Licenses and permits, user charges, fines and forfeitures, and miscellaneous revenues are
recorded as revenues when received. Investment earnings are recorded as earned.
The Town reports the following major governmental funds:
¾ The General fund is the primary operating fund of the Town. It is used to account for all financial
resources, except those that are required to be accounted for in another fund.
¾ The Stabilization fund is a special revenue fund used to account for the accumulation of resources
to provide general and/or capital reserves.
¾ The Land Bank fund is a special revenue fund used to account for the accumulation of resources
to purchase open space or preservation of certain property.
¾ The Nonmajor Governmental funds consist of other special revenue, capital projects and
permanent funds that are aggregated and presented in the nonmajor governmental funds column
on the governmental funds financial statements. The following describes the general use of these
fund types:
• The Special Revenue fund is used to account for the proceeds of specific revenue sources
(other than permanent funds or capital projects funds) that are restricted by law or
administrative action to expenditures for specified purposes.
• The Capital Projects fund is used to account for financial resources to be used for the
acquisition or construction of major capital facilities (other than those financed by enterprise
and trust funds).
• The Permanent fund is used to account for financial resources that are legally restricted to the
extent that only earnings, not principal, may be used for purposes that support the
governmental programs.
Proprietary Fund Financial Statements
Proprietary fund financial statements are reported using the flow of economic resources measurement
focus and use the accrual basis of accounting. Under this method, revenues are recorded when earned and
expenses are recorded when the liabilities are incurred.
TOWN OF BREWSTER, MASSACHUSETTS
NOTES TO BASIC FINANCIAL STATEMENTS
JUNE 30, 2005
- 26 -
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 the proprietary funds principal ongoing operations. All revenues and expenses not
meeting this definition are reported as nonoperating revenues and expenses.
The following major proprietary funds are reported:
¾ The Water Enterprise fund is used to account for water activities.
¾ The Golf Enterprise fund is used to account for golf activities.
Fiduciary Fund Financial Statements
Fiduciary fund financial statements are reported using the flow of economic resources measurement focus
and use the accrual basis of accounting. Fiduciary funds are used to account for assets held by the Town
in a trustee capacity for others that cannot be used to support the governmental programs.
The following fiduciary fund types are reported:
¾ The Private-Purpose Trust fund is used to account for trust arrangements, other than those
properly reported in the permanent fund (nonmajor governmental funds), under which principal
and investment income exclusively benefit individuals, private organizations, or other
governments.
¾ The Agency fund is used to account for assets held in a purely custodial capacity.
Government-Wide and Fund Financial Statements
For the government-wide financial statements, and proprietary and fiduciary fund accounting, all
applicable Financial Accounting Standards Board (FASB) pronouncements issued on or prior to
November 30, 1989, are applied, unless those pronouncements conflict with or contradict GASB
pronouncements.
D. Cash and Investments
Government-Wide and Fund Financial Statements
Cash and short term investments are considered to be cash on hand, demand deposits and short-term
investments with original maturities of three months or less from the date of acquisition. Investments are
reported at fair value.
E. Accounts Receivable
Government-Wide and Fund Financial Statements
The recognition of revenue related to accounts receivable reported in the government-wide financial
statements and proprietary and fiduciary funds financial statements are reported under the accrual basis of
accounting. The recognition of revenue related to accounts receivable reported in the governmental funds
financial statements are reported under the modified accrual basis of accounting.
TOWN OF BREWSTER, MASSACHUSETTS
NOTES TO BASIC FINANCIAL STATEMENTS
JUNE 30, 2005
- 27 -
Real Estate, Personal Property Taxes and Tax Liens
Real estate and personal property taxes are based on values assessed as of each January 1 and are
normally due on the subsequent November 1 and May 1. Property taxes that remain unpaid after the
respective due dates are subject to penalties and interest charges. By law, all taxable property in the
Commonwealth must be assessed at 100% of fair market value. Once levied, which is required to be at
least 30 days prior to the due date, these taxes are recorded as receivables in the fiscal year of levy.
Based on the Town’s experience, most property taxes are collected during the year in which they are
assessed. Liening of properties on which taxes remain unpaid occurs annually. The Town ultimately has
the right to foreclose on all properties where the taxes remain unpaid.
A statewide property tax limitation statute known as “Proposition 2 ½” limits the amount of increase in
property tax levy in any fiscal year. Generally, Proposition 2 ½ limits the total levy to an amount not
greater than 2 ½ % of the total assessed value of all taxable property within the Town. Secondly, the tax
levy cannot increase by more than 2 ½ % of the prior year’s levy plus the taxes on property newly added
to the tax rolls. Certain provisions of Proposition 2 ½ can be overridden by a Town-wide referendum.
Real estate receivables are secured via the tax lien process and are considered 100% collectible.
Accordingly, an allowance for uncollectibles is not reported.
Personal property taxes cannot be secured through the lien process. The allowance of uncollectibles is
estimated based on historical trends and specific account analysis.
Motor Vehicle Excise
Motor vehicle excise taxes are assessed annually for each vehicle registered in the Town and are recorded
as receivables in the fiscal year of the levy. The Commonwealth is responsible for reporting the number
of vehicles registered and the fair values of those vehicles. The tax calculation is the fair value of the
vehicle multiplied by $25 per $1,000 of value.
The allowance for uncollectibles is estimated based on historical trends and specific account analysis.
Water
User fees are levied semi-annually based on meter readings and are subject to penalties if they are not
paid by the respective due date. Water liens are processed in December of every year and included as a
lien on the property owner's tax bill. Water charges and related liens are recorded as receivables in the
fiscal year of the levy.
Since the receivables are secured via the lien process, these accounts are considered 100% collectible and
therefore do not report an allowance for uncollectibles.
Departmental and Other
Departmental and other receivables consist primarily of Title V and ambulance receivables and are
recorded as receivables in the fiscal year accrued. The allowance for uncollectibles is estimated based on
historical trends and specific account analysis.
TOWN OF BREWSTER, MASSACHUSETTS
NOTES TO BASIC FINANCIAL STATEMENTS
JUNE 30, 2005
Intergovernmental
Various federal and state grants for operating and capital purposes are applied for and received annually.
For non-expenditure driven grants, receivables are recognized as soon as all eligibility requirements
imposed by the provider have been met. For expenditure driven grants, receivables are recognized when
the qualifying expenditures are incurred and all other grant requirements are met.
These receivables are considered 100% collectible and therefore do not report an allowance for
uncollectibles.
F. Inventories
Government-Wide and Fund Financial Statements
Inventories of the governmental funds and the water and golf enterprise funds are recorded as
expenditures at the time of purchase. Such inventories are not material in total to the basic financial
statements, and therefore are not reported.
G. Capital Assets
Government-Wide and Proprietary Fund Financial Statements
Capital assets, which include land, vehicles, buildings and improvements, capital improvements,
machinery and equipment, and infrastructure (e.g., water mains, roadways, and similar items), are
reported in the applicable governmental or business-type activities column of the government-wide
financial statements, and the proprietary fund financial statements. Capital assets are recorded at historical
cost, or at estimated historical cost, if actual historical cost is not available. Donated capital assets are
recorded at the estimated fair market value at the date of donation. Except for the capital assets of the
governmental activities column in the government-wide financial statements, construction period interest
is capitalized on constructed capital assets if material.
All purchases and construction costs in excess of $15,000, and all land costs, are capitalized at the date of
acquisition or construction, respectively, with expected useful lives of five years or greater.
Capital assets (excluding land and construction in progress) are depreciated on a straight-line basis. The
estimated useful lives of capital assets are as follows:
Asset Class
Estimated
Useful Life
(in years)
Buildings and Improvements 20-40
Capital Improvements (other than buildings) 20
Machinery, Equipment and Vehicles 5-15
Infrastructure 40
- 28 -
TOWN OF BREWSTER, MASSACHUSETTS
NOTES TO BASIC FINANCIAL STATEMENTS
JUNE 30, 2005
- 29 -
The cost of normal maintenance and repairs that do not add to the value of the assets or materially extend
asset lives are not capitalized and are treated as expenses when incurred. Improvements are capitalized.
Governmental Fund Financial Statements
Capital asset costs are recorded as expenditures in the fiscal year of purchase for the various funds.
H. Interfund Receivables and Payables
During the course of its operations, transactions occur between and within individual funds that may
result in amounts owed between funds.
Government-Wide Financial Statements
Transactions of a buyer/seller nature between and within governmental funds are eliminated from the
governmental activities in the statement of net assets. Any residual balances outstanding between the
governmental activities and business-type activities are reported in the statement of net assets as "internal
balances".
Fund Financial Statements
Transactions of a buyer/seller nature between and within funds are not eliminated from the individual
fund statements. Receivables and payables resulting from these transactions are classified as "Due from
other funds" or "Due to other funds" on the balance sheet.
I. Interfund Transfers
During the course of its operations, resources are permanently reallocated between and within funds.
These transactions are reported as operating transfers in and operating transfers out.
Government-Wide Financial Statements
Operating transfers between and within governmental funds are eliminated from the governmental
activities in the statement of net assets. Any residual balances outstanding between the governmental
activities and business-type activities are reported in the statement of activities as "Transfers, net".
Fund Financial Statements
Operating transfers between and within funds are not eliminated from the individual fund statements and
are reported as operating transfers in and operating transfers out.
J. Deferred Revenue
Deferred revenue at the governmental fund financial statement level represents billed receivables that do
not meet the available criterion in accordance with the current financial resources measurement focus and
the modified accrual basis of accounting. Deferred revenue is recognized as revenue in the conversion to
the government-wide (full accrual) financial statements.
TOWN OF BREWSTER, MASSACHUSETTS
NOTES TO BASIC FINANCIAL STATEMENTS
JUNE 30, 2005
- 30 -
K. Net Assets and Fund Equity
Government-Wide Financial Statements (Net Assets)
Net assets are classified into three components:
a. Invested in capital assets, net of related debt – consists of capital assets including restricted
capital assets, net of accumulated depreciation and reduced by the outstanding balances of any
bonds, mortgages, notes, or other borrowings that are attributable to the acquisition, construction,
or improvement of those assets.
b. Restricted net assets – Consists of net assets with constraints placed on the use either by (1)
external groups such as creditors, grantors, contributors, or laws or regulations of other
governments; or (2) law through constitutional provisions or enabling legislation.
Net assets have been “restricted” for the following:
• Streets represent amounts committed by the Commonwealth for the repair and/or construction
of streets.
• Permanent funds -expendable represents amounts held in trust for which the expenditures are
restricted by various trust agreements.
• Permanent funds -nonexpendable represents amounts held in trust for which only investment
earnings may be expended.
• Other specific purpose represents restrictions placed on assets from outside parties.
c. Unrestricted net assets – All other net assets that do not meet the definition of “restricted” or
“invested in capital assets, net of related debt.”
Fund Financial Statements (Fund Balances)
a. Fund balances consist of funds that are reserved for amounts, that are not available for
appropriation, that are legally restricted by outside parties for a specific future use, and
designations of fund balances that represent tentative management plans that are subject to
change.
Fund balances have been reserved for the following:
• Encumbrances and continuing appropriations represents amounts obligated under purchase
orders, contracts and other commitments for expenditures that are being carried over to the
ensuing fiscal year.
• Perpetual permanent funds represent amounts held in trust for which only investment
earnings may be expended.
TOWN OF BREWSTER, MASSACHUSETTS
NOTES TO BASIC FINANCIAL STATEMENTS
JUNE 30, 2005
- 31 -
Fund balances have been designated for the following:
• Subsequent year's expenditures represents amounts appropriated for the fiscal year 2006
operating budget.
b. Undesignated fund balances – all other fund balances that do not meet the definition of
“reserved” or “designated.”
L. Long-term debt
Government-Wide and Proprietary Fund Financial Statements
Long-term debt is reported as liabilities in the government-wide and proprietary fund statement of net
assets. Material bond premiums and discounts are deferred and amortized over the life of the bonds using
the effective interest method. Bonds payable are reported net of the applicable bond premium or discount.
Governmental Fund Financial Statements
The face amount of governmental funds long-term debt is reported as other financing sources. Bond
premiums and discounts, as well as issuance costs, are recognized in the current period. Bond premiums
are reported as other financing sources and bond discounts are reported as other financing uses. Issuance
costs, whether or not withheld from the actual bond proceeds received, are reported as general
government expenditures.
M. Investment Income
Excluding the permanent funds, investment income derived from major and nonmajor governmental
funds is legally assigned to the general fund unless otherwise directed by Massachusetts General Laws
(MGL).
N. Compensated Absences
Employees are granted sick and vacation leave in varying amounts. Upon retirement, termination or
death, certain employees are compensated for unused sick and vacation leave (subject to certain
limitations) at their then current rates of pay. The total amount of sick and vacation costs to be paid in
future years is not material to the basic financial statements and has not been recorded on the basic
financial statements.
TOWN OF BREWSTER, MASSACHUSETTS
NOTES TO BASIC FINANCIAL STATEMENTS
JUNE 30, 2005
- 32 -
O. Post Retirement Benefits
Government-Wide and Fund Financial Statements
In addition to providing pension benefits, health and life insurance coverage is provided for retired
employees and their survivors in accordance with Chapter 32B, of Massachusetts General Laws, under
various contributory plans. The cost of providing health and life insurance is recognized by recording the
employer's 50% share of insurance premiums in the general fund in the fiscal year paid. All benefits are
provided through third-party insurance carriers and health maintenance organizations that administer,
assume, and pay all claims. For the fiscal year ended June 30, 2005, this expense/expenditure totaled
approximately $160,032. There were approximately 58 participants eligible to receive benefits at
June 30, 2005.
P. Use of Estimates
Government-Wide and Fund Financial Statements
The preparation of the accompanying 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 reported amounts of assets and liabilities and disclosure of contingent assets
and liabilities at the date of the financial statements and the reported amounts of revenues and
expenditures/expenses during the reporting period. Actual results could vary from estimates that were
used.
Q. Total Column
Government-Wide Financial Statements
The total column presented on the government-wide financial statements represents consolidated financial
information.
Fund Financial Statements
The total column on the fund financial statements is presented only to facilitate financial analysis. Data in
this column is not comparable to the consolidated financial information.
TOWN OF BREWSTER, MASSACHUSETTS
NOTES TO BASIC FINANCIAL STATEMENTS
JUNE 30, 2005
NOTE 2 – STEWARDSHIP, COMPLIANCE AND ACCOUNTABILITY
A. Budgetary Basis of Accounting
Pursuant to Chapter 44, Section 32 of the Massachusetts General Laws, the Town adopts an annual
budget for the general fund as well as for those special revenue funds for which the provisions of Chapter
44,Section 53fl1/2 have been adopted. The budgets for all departments and operations of the Town,
except that of the public schools, are prepared under the direction of the Town Administrator. The School
Department budget is prepared under the direction of the School Committee. The level of expenditures
may not legally exceed appropriations for each department or undertaking in the following categories: (1)
salaries and wages; (2) ordinary maintenance; and (3) capital outlays.
The majority of appropriations are non-continuing which lapse at the end of each fiscal year. Others are
continuing appropriations for which the governing body has authorized that an unspent balance from a
prior fiscal year be carried forward and made available for spending in the current fiscal year. Carryover
articles, not encumbrances, are included as part of the subsequent fiscal year's original budget.
Original and supplemental appropriations are enacted upon by a Town Meeting vote. Management may
not amend the budget without seeking the approval of the governing body. The Town’s Finance
Committee can legally transfer funds from its reserve fund to other appropriations within the budget
without seeking Town Meeting approvals. The original fiscal year 2005 approved budget authorized
$25,697,610 in current year appropriations and other amounts to be raised and $1,221,158 in carryover
articles carried over from previous fiscal years. Supplemental appropriations of $939,137 were approved
at two Special Town Meetings for fiscal year 2005.
The Finance Director has the responsibility to ensure that budgetary controls are maintained and
monitored through the accounting system.
B. Budgetary – GAAP Reconciliation
For budgetary financial reporting purposes, the Uniform Municipal Accounting System basis of
accounting (established by the Commonwealth) is followed, which differs from the GAAP basis of
accounting. A reconciliation of budgetary-basis to GAAP-basis results for the general fund for the fiscal
year ended June 30, 2005, is presented below:
Net change in fund balance - budgetary basis (1,493,083)$
Basis of accounting differences:
Increase in revenue for on-behalf payments - MTRS 308,314
Increase in expenditures for on-behalf payments - MTRS (308,314)
Increase in revenue for the MWPAT subsidy 10,595
Increase in expenditures for the MWPAT subsidy (10,595)
Adjustment for current year articles 1,137,134
Adjustment for current year encumbrances 192,901
Adjustment for expenditures from prior year encumbrances (128,035)
Net change in fund balance - GAAP basis (291,083)$
- 33 -
TOWN OF BREWSTER, MASSACHUSETTS
NOTES TO BASIC FINANCIAL STATEMENTS
JUNE 30, 2005
- 34 -
C. Deficit Fund Balances
Several individual fund deficits exist within the special revenue funds. These individual deficits will be
eliminated through subsequent fiscal year budget transfers and grants during fiscal year 2006.
NOTE 3 – DEPOSITS AND INVESTMENTS
In fiscal 2005, the Town adopted Government Accounting Standards Board (GASB) Statement No. 40,
Deposit and Investment Risk Disclosures.
a. Deposits
State and local statutes place certain limitations on the nature of deposits and investments
available to the Town. Deposits (including demand deposits, term deposits and certificates of
deposit) in any one financial institution may not exceed certain levels unless collateralized by the
financial institutions involved.
i. Custodial Credit Risk
Custodial credit risk is the risk that in the event of bank failure, the Town’s deposits may not
be returned. The Town carries deposits that are fully insured by FDIC insurance, DIF
insurance or collateralized with securities held by the Town or the Town’s agent in the
Town’s name. The Town also carries deposits that are not collateralized and are uninsured.
As of June 30, 2005, the bank balances of uninsured and uncollateralized deposits are
$12,436,226.
b. Investments
Investments can also be made in securities issued by or unconditionally guaranteed by the U.S.
government or agencies that have a maturity of less than one year from the date of purchase,
repurchase agreement guaranteed by the U.S. government or agencies that have a maturity of less
than one year from the date of purchase, repurchase agreements guaranteed by such securities
with maturity dates of no more than 90 days from the date of purchase, and units in the
Massachusetts Municipal Depository Trust (MMDT). The Treasurer of the Commonwealth of
Massachusetts oversees the financial management of the MMDT, a local investment pool for
cities, towns, and other state and local agencies within the Commonwealth. The Town’s fair
value of its investment in MMDT represents their value of the pool’s shares. The Town’s Trust
Funds have expanded investment powers including the ability to invest in equity securities,
corporate bonds, annuities and other specified investments.
The composition of the Town’s bank recorded deposits and investments fluctuates depending
primarily on the timing of property tax receipts, proceeds from borrowings, collections of state
and federal aid, and capital outlays throughout the year.
TOWN OF BREWSTER, MASSACHUSETTS
NOTES TO BASIC FINANCIAL STATEMENTS
JUNE 30, 2005
i) Interest Rate Risk
The following is a listing of the primary government’s fixed income investments and related
maturity schedule (in years) as of June 30, 2005:
Investment type Fair value
Less
than 1
MMDT 2,450,479$ 2,450,479$
Money Markets 7,040,399 7,040,399
Total 9,490,878$ 9,490,878$
The Town’s guidelines do not specifically address limits on maturities as a means of
managing its exposure to fair value losses arising from increasing interest rates.
ii) Credit Risk
The Town’s fixed income investments as of June 30, 2005 were rated by Moody’s and/or
equivalent national rating organization and the ratings are presented below using the Moody’s
rating scale:
Investment Type Fair Value
Not
rated
MMDT 2,450,479$ 2,450,479$
Money Markets 7,040,399 7,040,399
Total 9,490,878$ 9,490,878$
- 35 -
TOWN OF BREWSTER, MASSACHUSETTS
NOTES TO BASIC FINANCIAL STATEMENTS
JUNE 30, 2005
NOTE 4 – RECEIVABLES
The receivables at June 30, 2005 for the Town’s individual major and nonmajor governmental funds, and
fiduciary funds in the aggregate, including the applicable allowances for uncollectible accounts, are as
follows:
Allowance
Gross for Net
Receivables:Amount Uncollectibles Amount
Real estate and personal property taxes 228,208$ (1,400)$ 226,808$
Tax liens 385,441 - 385,441
Motor vehicle and other excise taxes 120,395 (14,000) 106,395
Departmental and other 621,491 (140,000) 481,491
Intergovernmental 6,722,500 - 6,722,500
Special assessments 522,106 - 522,106
Total 8,600,141$ (155,400)$ 8,444,741$
The receivables at June 30, 2005, for the enterprise funds consist of the following:
Allowance
Gross for Net
Receivables:Amount Uncollectibles Amount
Water
User fees 55,173$ -$ 55,173$
Special Assessments 78,874 - 78,874
Total 134,047$ -$ 134,047$
- 36 -
TOWN OF BREWSTER, MASSACHUSETTS
NOTES TO BASIC FINANCIAL STATEMENTS
JUNE 30, 2005
Governmental funds report deferred revenue in connection with receivables for revenues that are not
considered to be available to liquidate liabilities of the current period. Governmental funds also defer
revenue recognition in connection with revenues that have been received, but not yet earned. At the end
of the current fiscal year, the various components of deferred revenue reported in the governmental funds
were as follows:
Nonmajor
General Land Governmental
Receivable Type:Fund Bank Funds Total
Property Taxes 191,807$ -$ -$ 191,807$
Tax Liens 385,441 - - 385,441
Motor vehicle excise taxes 106,395 - - 106,395
Departmental and other - 12,236 464,264 476,500
Intergovernmental 6,258,390 - 459,593 6,717,983
Special assessments - - 522,106 522,106
Total 6,942,033$ 12,236$ 1,445,963$ 8,400,232$
Deferred Revenue Analysis
- 37 -
TOWN OF BREWSTER, MASSACHUSETTS
NOTES TO BASIC FINANCIAL STATEMENTS
JUNE 30, 2005
NOTE 5 – CAPITAL ASSETS
Capital asset activity for the fiscal year ended June 30, 2005, was as follows:
Beginning Ending
Governmental Activities:Balance Increases Decreases Balance
Capital assets not being depreciated:
Land 28,037,512$ -$ -$ 28,037,512$
Total capital assets not being depreciated 28,037,512 - - 28,037,512
Capital assets being depreciated:
Building and improvements 23,011,549 - - 23,011,549
Capital improvement (other than buildings)97,397 609,435 - 706,832
Machinery, equipment, and vehicles 5,944,943 437,910 (23,341) 6,359,512
Infrastructure 4,351,425 - - 4,351,425
Total capital assets being depreciated 33,405,314 1,047,345 (23,341) 34,429,318
Less accumulated depreciation for:
Building and improvements (5,073,792) (573,179) - (5,646,971)
Capital improvement (other than buildings)(74,453) (18,717) - (93,170)
Machinery, equipment, and vehicles (4,497,139) (387,173) 23,341 (4,860,971)
Infrastructure (2,179,759) (203,216) - (2,382,975)
Total accumulated depreciation (11,825,143) (1,182,285) 23,341 (12,984,087)
Total capital assets being depreciated, net 21,580,171 (134,940) - 21,445,231
Total governmental activities capital assets, net 49,617,683$ (134,940)$ -$ 49,482,743$
- 38 -
TOWN OF BREWSTER, MASSACHUSETTS
NOTES TO BASIC FINANCIAL STATEMENTS
JUNE 30, 2005
Beginning Ending
Business-Type Activities:Balance Increases Decreases Balance
Capital assets not being depreciated:
Land 2,874,212$ -$ -$ 2,874,212$
Construction in progress - 178,858 - 178,858
Total capital assets not being depreciated 2,874,212 178,858 - 3,053,070
Capital assets being depreciated:
Buildings and improvements 2,476,050 - - 2,476,050
Machinery, equipment, and vehicles 1,836,034 72,051 (30,600) 1,877,485
Infrastructure 17,958,332 992,422 - 18,950,754
Total capital assets being depreciated 22,270,416 1,064,473 (30,600) 23,304,289
Less accumulated depreciation for:
Buildings and improvements (350,118) (61,581) - (411,699)
Machinery, equipment, and vehicles (1,051,419) (163,923) 30,600 (1,184,742)
Infrastructure (4,506,651) (473,769) - (4,980,420)
Total accumulated depreciation (5,908,188) (699,273) 30,600 (6,576,861)
Total capital assets being depreciated, net 16,362,228 365,200 - 16,727,428
Total business-type activites capital assets, net 19,236,440$ 544,058$ -$ 19,780,498$
Depreciation expense was charged to functions/programs of the primary government as follows:
General government 519,226$
Public safety 275,753
Education 81,961
Public works 275,706
Human services -
Culture and recreation 29,639
Total depreciation expense - governmental activities 1,182,285$
Water 334,036$
Golf 365,237
Total depreciation expense - business-type activities 699,273$
Governmental Activities:
Business-Type Activities:
- 39 -
TOWN OF BREWSTER, MASSACHUSETTS
NOTES TO BASIC FINANCIAL STATEMENTS
JUNE 30, 2005
NOTE 6 – INTERFUND TRANSFERS
Interfund transfers for the fiscal year ended June 30, 2005, are summarized as follows:
Nonmajor
General Governmental Stabilization
Operating Transfers Out: Fund Funds Fund Total
Nonmajor Governmental Funds 910,888$ -$ -$ 910,888$ (1)
Water Enterprise Fund 179,672 - - 179,672 (2)
Golf Enterprise Fund 606,755 - - 606,755 (2)
Stabilization Fund 450,000 - 450,000 (3)
General Fund - 270,000 600,000 870,000 (1)
Total 1,697,315$ 720,000$ 600,000$ 3,017,315$
Operating Transfers In:
(1) Represents budgeted transfer to supplement the operating budget.
(2) Represents budgeted transfers from the various enterprise funds to the general fund.
(3) Represents operating transfer from the Stabilization Fund to the Stony Brook Phase IV Building
Improvement Capital Project Fund.
NOTE 7 – SHORT-TERM FINANCING
Under state law, and with the appropriate authorization, the Town is authorized to borrow funds on a
temporary basis as follows:
• To fund current operations prior to the collection of revenues by issuing revenue anticipation notes
(RANS).
• To fund grants prior to reimbursement by issuing grant anticipation notes (GANS).
• To fund Capital project costs incurred prior to selling permanent debt by issuing bond anticipation
notes (BANS).
• To fund current project costs and other approved expenditures incurred, that are anticipated to be
reimbursed by the Commonwealth through the issuance of State Aid anticipation notes (SAANS).
Short-term loans are general obligations of the Town and maturity dates are governed by statute. Interest
expenditures and expenses for short-term borrowings are accounted for in the general fund and enterprise
funds respectively.
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TOWN OF BREWSTER, MASSACHUSETTS
NOTES TO BASIC FINANCIAL STATEMENTS
JUNE 30, 2005
The following is a summary of changes in short-term debt for the year ended June 30, 2005:
Type Purpose
Rate
(%)
Due
Date
Balance at
June 30, 2004
Renewed/
Issued
Retired/
Redeemed
Balance at
June 30, 2005
BAN Land Acquisition 1.35 1/5/2005 370,000$ -$ (370,000)$ -$
BAN Land Acquisition 2.60 8/15/2005 - 325,000 - 325,000
BAN Land Acquisition 2.39 8/31/2005 - 945,000 - 945,000
Total Governmental Funds 370,000 1,270,000 (370,000) 1,270,000
BAN Water Main - Slough Road 1.30 1/21/2005 70,000 - (70,000) -
BAN Water Main - Slough Road 2.45 8/31/2005 - 70,000 - 70,000
BAN Well #5 Rehabilitation 2.45 8/31/2005 - 165,000 - 165,000
BAN Golf Course Irrigation 2.39 8/31/2005 - 355,000 - 355,000
BAN Golf Course Irrigation 2.75 8/31/2005 - 445,000 - 445,000
Total Enterprise Funds 70,000 1,035,000 (70,000) 1,035,000
Total 440,000$ 2,305,000$ (440,000)$ 2,305,000$
NOTE 8 – LONG-TERM DEBT
The Town is subject to a dual-level, general debt limit: the normal debt limit and the double debt limit.
Such limits are equal to 5% and 10%, respectively, of the valuation of taxable property in the Town as
last equalized by the Commonwealth’s Department of Revenue. Debt may be authorized up to the normal
debt limit without state approval. Authorizations under the double debt limit however require the approval
of the Commonwealth’s Emergency Finance Board. Additionally, there are many categories of general
long-term debt which are exempt from the debt limit but are subject to other limitations.
The following is a summary of the changes in long-term debt for the year ended June 30, 2005:
Bonds and Notes Payable Schedule -Governmental Funds
Project
Interest
Rate (%)
Outstanding at
June 30, 2004 Issued Redeemed
Outstanding at
June 30, 2005
School 5.15 5,075,000$ -$ 425,000$ 4,650,000$
Library 5.15 600,000 - 50,000 550,000
MWPAT Title V Septic Var 176,602 - 10,400 166,202
Road Betterments 4.20 77,500 - 15,500 62,000
Road Betterments 4.80 90,000 - 15,000 75,000
Police Station 5.51 2,720,000 - 170,000 2,550,000
Road Betterments 3.80 85,000 - 15,000 70,000
Road Betterments 3.59 255,000 - 30,000 225,000
Road Betterments 3.62 205,000 - 25,000 180,000
Road Betterments 280,000 - 25,000 255,000
MWPAT Title V Septic 3.59 185,254 - - 185,254
Total 9,749,356$ -$ 780,900$ 8,968,456$
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TOWN OF BREWSTER, MASSACHUSETTS
NOTES TO BASIC FINANCIAL STATEMENTS
JUNE 30, 2005
The annual debt service requirements for principal and interest for Governmental bonds and notes
outstanding at June 30, 2005 are as follows:
Fiscal Year Principal Interest Total
2006 790,425$ 446,093$ 1,236,518$
2007 790,430 408,927 1,199,357
2008 785,425 371,391 1,156,816
2009 785,425 333,388 1,118,813
2010 769,925 294,668 1,064,593
2011-2015 3,594,626 898,792 4,493,418
2016-2020 1,402,000 184,837 1,586,837
2021-2025 50,200 4,518 54,718
Total 8,968,456$ 2,942,614$ 11,911,070$
Bonds and Notes Payable Schedule -Water and Golf Enterprise Fund
Project
Interest
Rate (%)
Outstanding at
June 30, 2004 Issued Redeemed
Outstanding at
June 30, 2005
Golf Course 4.75 8,615,000$ -$ 355,000$ 8,260,000$
Water Mains 5.51 2,430,000 - 155,000 2,275,000
Telemetry 5.51 120,000 - 25,000 95,000
Water Betterments - Sears Rd 3.80 15,000 - 5,000 10,000
Water Betterments - Williams Dr 3.80 35,000 - 5,000 30,000
Standpipe #2 3.80 575,000 - 75,000 500,000
Standpipe Rehabilitation 3.62 725,000 - 75,000 650,000
Total 12,515,000$ -$ 695,000$ 11,820,000$
The annual debt service requirements for principal and interest for water and golf enterprise fund bonds
and notes outstanding at June 30, 2005 are as follows:
Fiscal Year Principal Interest Total
2006 710,000$ 560,753$ 1,270,753$
2007 730,000 529,128 1,259,128
2008 745,000 497,003 1,242,003
2009 765,000 463,778 1,228,778
2010 775,000 429,393 1,204,393
2011-2015 3,865,000 1,603,148 5,468,148
2016-2020 4,230,000 656,330 4,886,330
Total 11,820,000$ 4,739,533$ 16,559,533$
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TOWN OF BREWSTER, MASSACHUSETTS
NOTES TO BASIC FINANCIAL STATEMENTS
JUNE 30, 2005
Loans Authorized and Unissued
As of June 30, 2005, the Town has loans authorized and unissued as follows:
Date
Description Authorized Amount
Water Mains - Slough Road 5/8/2001 750,000$
Septic Loans Title V 11/19/2001 14,746
Elementary School - Septic 11/20/1995 120,000
Septage Betterments 5/6/1996 28,600
Septage Betterments 5/4/1998 2,597
New Water Supply Well No. 5 5/5/2003 165,000
Land Acquisition -Jolly Whaler 11/1/2003 945,000
Irrigation System - Captains Golf Course 5/3/2004 800,000
Land Acquisition - Krawitz 11/15/2004 325,000
Kings Grant Road Betterments 5/2/2005 307,000
Barons Way Road Betterments 5/2/2005 170,000
Total 3,627,943$
School Building Assistance Bureau Reimbursements
Chapter 645 of the Act of 1948 as amended (“Chapter 645”) created a statewide school building
assistance program. Pursuant to this program, cities and towns issued bonds for eligible school building
projects and were reimbursed over a period of years by the Commonwealth according to a statutory
percentage for such city or town.
Legislation enacted as part of the Commonwealth’s Fiscal 2001 budget repealed 645 and created a new
school building assistance program codified as Chapter 70B of the Massachusetts General Laws. Among
other changes, the new program includes grants for alternatives to construction and calculates grants for
each project based on a number of factors. The new legislation does not affect the reimbursement
percentages for bonds previously issued under Chapter 645, and the grants for certain “grandfathered”
projects will be based on the statutory percentages provided for in Chapter 645.
The Town has been approved for a 65% percent state school construction grant through the School
Construction Assistance Bureau (SBAB) to cover eligible project costs, including debt service associated
with the financing of these projects, subject to annual appropriation by the state legislature. The Town
received $660,666 in FY 2005 from the SBAB for completed school construction projects.
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TOWN OF BREWSTER, MASSACHUSETTS
NOTES TO BASIC FINANCIAL STATEMENTS
JUNE 30, 2005
Changes in Long-term Liabilities
The following is a summary of changes in long-term liabilities for the year ended June 30, 2005:
Beginning Ending Current
Governmental Activities: Balance Additions Reductions Balance Portion
Bonds and notes payable 9,749,356$ -$ (780,900)$ 8,968,456$ 790,425$
Landfill postclosure care costs 1,350,000 - (700,000) 650,000 25,000
Total governmental activity
long-term liabilities 11,099,356$ -$ (1,480,900)$ 9,618,456$ 815,425$
Beginning Ending Current
Business-Type Activities: Balance Additions Reductions Balance Portion
Bonds and notes payable 12,515,000$ -$ (695,000)$ 11,820,000$ 710,000$
Total business-type activity
long-term liabilities 12,515,000$ -$ (695,000)$ 11,820,000$ 710,000$
The governmental activities long-term liabilities are generally liquidated by the general fund.
Overlapping Debt
The Town pays assessments under formulas which include debt service payments to other governmental
agencies providing services to the Town, (commonly referred to as overlapping debt). The following
summary sets forth the long-term debt of such governmental agencies and the estimated share being
financed by the Town as of June 30, 2005:
Total Long- Town's Town's
Term Debt Estimated Indirect
Agency Outstanding Share Debt
Barnstable County 460,000$ 4.25% 19,550$
Nauset Regional School District 12,502,356 48.69% 6,087,397
12,962,356$ 6,106,947$
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TOWN OF BREWSTER, MASSACHUSETTS
NOTES TO BASIC FINANCIAL STATEMENTS
JUNE 30, 2005
- 45 -
NOTE 9 – STABILIZATION FUND
At June 30, 2005, $1,899,453 has been set aside in the stabilization fund, which is classified as a major
fund in the governmental funds financial statements. The stabilization fund balance can be used for
general and/or capital purposes as approved by Town Meeting vote.
NOTE 10 – RISK FINANCING
The Town is exposed to various risks of loss related to torts; theft of, damage to or destruction of assets;
errors and omissions; injuries to employees; employee’s health and life; and natural disasters.
Buildings are fully insured against fire, theft, and natural disaster to the extent that losses exceed $1,000
per incident. The fully insurable value of Town buildings is $39,147,313.
The Town is insured for general liability; however, Chapter 258 of the Massachusetts General Laws limits
the Town’s liability to a maximum of $100,000 per claim in all matters except in actions relating to
federal civil rights, eminent domain and breach of contract. Such claims are charged to the general fund.
There were no such claims in 2005.
The Town is a member of the Cape Cod Municipal Health Group, (CCMHG) which is a Massachusetts
Municipal Health Insurance Joint purchase group. The Group includes thirteen Towns, six school
districts, five fire districts, seven water districts, one recreation authority, and one education collaborative
as participants. Health benefits consist of a traditional medical indemnity program and a Medex program
with Blue Cross Blue Shield of Massachusetts. The traditional medical indemnity program consists of
Master Health Plus and Master Health, Master Medical, and Master Medical Carveout plans. In addition,
the Group adopted an Exclusive Provider Organization plan with Harvard Pilgrim Health Care and a self
funded medi-wrap plan, Pilgrim Preferred 65, effective July 1, 1992. All of these plans are self-funded.
The Group adopted two Medicare Choice plans: Blue Care 65 and Tufts Secure Horizons (fully insured).
Beginning July 1, 1996, the group adopted Blue Cross Blue Shield Network Blue, a comprehensive, self-
funded exclusive provider organization plan. Also, beginning July 1, 1996, the Group adopted a
contributory dental insurance plan (self funded) and a voluntary (employee-pay-all/fully insured
premium) dental plan. Effective July 1, 2001, the Group adopted two Preferred Provider Organization
(PPO) plans. Blue Care Elect Preferred PP is administered by BCBS, and Harvard Pilgrim PPO is
administered by HPHC. Both PPO plans are self-funded.
The traditional medical indemnity plans, Blue Care Elect Preferred PPO plan, Network Blue EPO plan,
and Medex programs are on a claims-paid basis, and are administered by Blue Cross Blue Shield of
Massachusetts for a monthly administration fee based on the number of individual, single parent/single
child, and family plan subscribers for that particular month.
The Harvard Pilgrim EPO Plan, Harvard Pilgrim PPO plan, and Pilgrim Preferred 65 plan are on a
claims-paid basis, and are administered by Harvard Pilgrim health care for a monthly administration fee
based on a number of individual and family plan subscribers for that particular month.
The contributory dental insurance plan is on a claims-paid basis for subscribers whose employers pay a
portion (50% or more) of the monthly cost. The voluntary dental plan is on a fixed premium basis for all
other subscribers (an employee pay-all plan). The contributory dental plan is administered by Delta
Dental Plan of Massachusetts for a monthly administration fee based on the number of subscribers. The
voluntary dental plan is fully insured by Delta Dental Plan of Massachusetts.
TOWN OF BREWSTER, MASSACHUSETTS
NOTES TO BASIC FINANCIAL STATEMENTS
JUNE 30, 2005
- 46 -
The Group has a specific excess medical and prescription drug claims reinsurance contract with an
insurance carrier covering claims paid in excess of $150,000, and $150,000 per individual, to a lifetime
maximum amount payable of $2,000,000, and $2,000,000 at June 30, 2005 and 2004 respectively, for the
traditional medical indemnity, preferred provider organization (PPO), and exclusive provider organization
(EPO) plan contracts. The Group reinsures its Carveout A plan with a policy with a $50,000 specific
deductible. The Group no longer reinsures its Medex, Carveout A and B Plans, and Pilgrim Preferred 65
plans. The policy period covers claims incurred within twelve months and paid within twenty-four
months.
All refunds, surplus, and deficits are dealt with on a proportional and collective basis. In the case of a
certified surplus, the Board determines whether the excess funds will remain in the Board’s trust fund for
the purpose of reducing the participants’ future premium cost, or be distributed to the Participating
Governmental Units in proportion to the number of Participating Governmental Unit’s employees and
retirees covered under the contract purchased at the time the surplus was incurred. In the case of a
certified deficit, additional revenue will be raised and paid by the Participating Governmental Unit’s
employees and retirees covered under the contract, purchased at the time the deficit was incurred. Each
participant has to be part of the Group for two years before sharing surpluses.
The Group provides health care coverage for employees that qualify for and select health care coverage as
an employee benefit as well as retired employees. There are 209 Town of Brewster employees and 56
retirees who participate in the Group’s health care programs. The Town contributes 75% of the premium
cost for employees and 50% of the premium cost for retirees and surviving spouses.
As of June 30, 2005, the Cape Cod Municipal Health Group had total assets of $26,367,383 total
liabilities of $11,514,480 (including $11,133,280 in estimated benefits obligations) and a total surplus of
$14,852,903.
NOTE 11 – PENSION PLAN
A. Plan Descriptions
The Town contributes to the Barnstable County Contributory Retirement System (the “System”), a cost
sharing, multiple-employer, defined benefit pension plan administered by the Barnstable County
Retirement Board. Substantially all employees are members of the “System” except for public school
teachers and certain school administrators who are members of the Massachusetts Teachers’ Retirement
System (MTRS) to which the Town does not contribute.
The “System” and the MTRS are contributory defined benefit plans and membership in both the
“System” and the MTRS is mandatory upon commencement of employment for all permanent, full-time
employees. The “System” and the MTRS provide retirement, disability and death benefits to plan
members and beneficiaries.
Chapter 32 of the Massachusetts General Laws assigns authority to establish and amend benefit
provisions of the plan, and grant cost-of-living increases, to the State legislature. The “System” issues a
publicly available financial report, which can be obtained through the Commonwealth of Massachusetts,
Public Employee Retirement Administration Commission (“PERAC”), One Ashburton Place, Boston,
Massachusetts 02108.
TOWN OF BREWSTER, MASSACHUSETTS
NOTES TO BASIC FINANCIAL STATEMENTS
JUNE 30, 2005
- 47 -
B. Funding Policies
Barnstable County Contributory Retirement System
Plan members are required to contribute to the “System” at rates ranging from 5% to 11% of annual
covered compensation. The Town is required to pay into the “System”, its share of the remaining system-
wide, actuarially determined, contribution plus administration costs, which are apportioned among the
employers, based on active covered payroll. The Commonwealth of Massachusetts reimburses the
“system” for a portion of the benefit payments for the cost of living increases. The contributions to the
“System” for years ended June 30, 2005, 2004, and 2004 were $852,570, $767,494, and $641,378
respectively, which were equal to its required contributions for each of these years.
Massachusetts Teachers’ Retirement System
Plan members (at varying rates of annual covered compensation) and the Commonwealth of
Massachusetts fund contributions to the MTRS. The Commonwealth of Massachusetts contributed “on-
behalf” payments to the MTRS totaling $308,314 for fiscal year 2005. In accordance with GASB
Statement No. 24, these on-behalf” payments have been recorded in the general fund as
intergovernmental revenues and pension expenditures.
NOTE 12 – COMMITMENTS AND CONTINGENCIES
The Town participates in a number of federal award programs. Although the grant programs have not
been audited in accordance with the provisions of the Single Audit Act Amendments of 1996 through
June 30, 2005, however, these programs may still be subject to financial and compliance audits in future
years. The amount, if any, of expenditures which may be disallowed by the granting agencies cannot be
determined at this time, although it is believed the amount, if any, would not be material.
The Town’s landfill was capped in 2000 by order of the Department of Environmental Protection (DEP).
The Town is responsible for post-closure monitoring of the site for thirty years (26 years remaining), and
the estimated liability has been recorded in the Statement of Net Assets, Governmental Activities. The
$650,000 reported as landfill post-closure liability at June 30, 2005 is based on what it would cost to
perform all post-closure care at June 30, 2005. Actual costs may be higher due to inflation, changes in
technology or changes in regulations.
Various legal actions and claims are pending. Litigation is subject to many uncertainties, and the outcome
of individual litigated matters is not always predictable. Although the amount of liability, if any, at June
30, 2005, cannot be ascertained, management believes any resulting liability should not materially affect
the financial position at June 30, 2005.
NOTE 13 – SUBSEQUENT EVENT
On September 8, 2005, the Town issued a general obligation bond of $2,972,000 for the purpose of
financing a land acquisition, road betterments, an irrigation system for the Town-owned golf course, and a
water main project. Principal is payable annually in variable amounts beginning on September 1, 2006
through September 1, 2025. Interest is payable semi-annually on March 1st and September 1st,
commencing March 1, 2006. The true interest cost rate is 3.64% for the term of the loan.
TOWN OF BREWSTER, MASSACHUSETTS
NOTES TO BASIC FINANCIAL STATEMENTS
JUNE 30, 2005
NOTE 14 – PRIOR PERIOD ADJUSTMENT
The governmental activities net assets balance has been restated to reflect the recognition of the Police
Station and the related accumulated depreciation not previously recorded.
Total
Governemental
Activities
Description Net Assets
Balance at June 30, 2004
as previously reported 52,747,536$
To record the value of the Police
Station at historical cost 3,948,237
To record accumulated depreciation
associated with the Police Station (148,059)
Balance at June 30, 2004
as restated 56,547,714$
NOTE 15 – PRIOR PERIOD RECLASSIFICATION
The following governmental funds have been restated to reflect the reclassification of the major Land
Bank Governmental Fund from the Nonmajor Governmental Funds, and the reclassification of the major
Stony Brook School Fund to the Nonmajor Governmental Funds at June 30, 2004.
Land Stony Nonmajor
Bank Brook Governmental
Description Fund School Fund Funds
Governmental fund balances at June 30, 2004,
as previously reported -$ 808,462$ 2,282,539$
To reclass funds from the Nonmajor Governmental funds
to the major Land Bank fund (57,894) - 57,894
To reclass the major Stony Brook School fund to the
Nonmajor Governmental funds - (808,462) 808,462
Governmental fund balances at June 30, 2004, as restated (57,894)$ -$ 3,148,895$
- 48 -