HomeMy Public PortalAboutBrewster 2007 Report on the Examination of the Basic Financial Statements
TOWN OF BREWSTER, MASSACHUSETTS
REPORT ON EXAMINATION OF
BASIC FINANCIAL STATEMENTS
JUNE 30, 2007
TOWN OF BREWSTER, MASSACHUSETTS
REPORT ON EXAMINATION OF
BASIC FINANCIAL STATEMENTS
JUNE 30, 2007
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 Statement 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 – 49
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 Town of Brewster,
Massachusetts as of and for the year ended June 30, 2007, which collectively comprise the Town’s 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 the 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,
2007, and the respective changes in financial position, and, where applicable, cash flow 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 10, 2008
Management’s Discussion and Analysis
As management of the Town of Brewster (the Town), we offer readers of the Town’s financial statements this
narrative overview and analysis of the financial activities of the Town for the fiscal year ended June 30, 2007.
We encourage readers to consider this information in addition to the statements and notes.
The Town complies with financial reporting requirements issued by the Governmental Accounting Standards
Board (GASB). GASB is the authoritative standard setting body that provides guidance on how to prepare
financial statements in conformity with accounting principles generally accepted in the United States of America
(GAAP). Users of these financial statements, such as investors and rating agencies, rely on the GASB to establish
consistent reporting standards for all governments in the United States. This consistent application is the only
way users can assess the financial condition of one government compared to others.
Financial Highlights
• The assets of the Town exceeded its liabilities at the close of the fiscal year by $75 million (net assets). Of
this amount, $15.4 million is considered unrestricted (unrestricted net assets).
• The unrestricted net assets of the Town’s governmental activities are $11.5 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 $3.9 million, or 5.49%, from fiscal 2006. Within this total, net
assets of governmental activities increased by $3.6 million, a 6% increase from fiscal 2006. Also, net assets
of business-type activities increased by $303 thousand or 2.71% from 2006.
• At June 30, 2007, the Town’s governmental funds had a combined ending fund balance of $14.2 million. The
combined governmental funds balance increased by $3.58 million, a 34% increase over the prior year’s
ending fund balance.
• The Town’s general fund reported a fund balance of $5.58 million at the end of fiscal 2007. The unreserved
fund balance for the general fund was $4.54 million or 16% of total general fund expenditures. A total of
$1.17 million of the unreserved fund balance was designated for funding the fiscal year 2008 budget.
• The total cost of all Town services for fiscal 2007 was $34.2 million, $29.3 million of which was for
governmental activities, and $4.9 million of which was for business-type activities.
• The Town refinanced bonds in fiscal 2007 resulting in a savings of $220 thousand for the current year.
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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).
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.
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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.
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 statements, 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 funds 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 $75,095,507 at the close of fiscal year 2007. 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 $56,615,788, or
75.39% 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 $15,491,890
(20.63%), which may be used to meet the government’s ongoing obligations to its citizens and creditors.
The Town reduced its total liabilities by $18,381 over fiscal 2006, while total net assets increased by $3,891,369,
or 3.96%. Net assets of governmental activities increased by $3,606,659, a 6.01% increase from fiscal 2006. Net
assets of business-type activities increased by $303,091 or 2.71% from 2006. There was an increase of $59,330 in
net assets reported in connection with the water business-type activities, and an increase of $243,761 in net assets
in connection with the golf department business-type activity, respectively.
An additional portion of the net assets totaling $2,987,829 or 3.98%, represents resources that are subject to
external restrictions on how they may be used.
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Increase Increase Increase
FY 2007 FY 2006 (Decrease) FY 2007 FY 2006 (Decrease) FY 2007 FY 2006 (Decrease)
Assets:
Current assets 19,163,521$ 15,645,731$ 3,517,790$ 4,177,673$ 4,046,293$ 131,380$ 23,341,194$ 19,692,024$ 3,649,170$
Noncurrent assets (excluding capital)4,589,676 6,085,229 (1,495,553) 27,116 20,688 6,428 4,616,792 6,105,917 (1,489,125)
Capital assets 54,853,599 52,633,950 2,219,649 19,466,929 19,955,254 (488,325) 74,320,528 72,589,204 1,731,324
Total assets 78,606,796 74,364,910 4,241,886 23,671,718 24,022,235 (350,517) 102,278,514 98,387,145 3,891,369
Liabilities:
Current liabilities (excluding debt)1,838,200 1,470,547 367,653 268,202 157,810 110,392 2,106,402 1,628,357 478,045
Noncurrent liabilities (excluding debt)723,000 1,188,000 (465,000) - - - 723,000 1,188,000 (465,000)
Current debt 1,980,429 3,037,429 (1,057,000) 906,000 870,000 36,000 2,886,429 3,907,429 (1,021,000)
Noncurrent debt 10,477,176 8,687,602 1,789,574 10,990,000 11,790,000 (800,000) 21,467,176 20,477,602 989,574
Total liabilities 15,018,805 14,383,578 635,227 12,164,202 12,817,810 (653,608) 27,183,007 27,201,388 (18,381)
Net Assets:
Capital assets net of related debt 49,024,255 43,507,912 5,516,343 7,591,533 7,319,194 272,339 56,615,788 50,827,106 5,788,682
Restricted 2,987,829 4,529,657 (1,541,828) - - - 2,987,829 4,529,657 (1,541,828)
Unrestricted 11,575,907 11,943,763 (367,856) 3,915,983 3,885,231 30,752 15,491,890 15,828,994 (337,104)
Total net assets 63,587,991$ 59,981,332$ 3,606,659$ 11,507,516$ 11,204,425$ 303,091$ 75,095,507$ 71,185,757$ 3,909,750$
Revenues
Program Revenues:
Charges for services 1,885,053$ 1,681,299$ 203,754$ 5,965,511$ 5,608,241$ 357,270$ 7,850,564$ 7,289,540$ 561,024$
Operating grants and contributions 3,274,503 2,606,241 668,262 84,492 71,902 12,590 3,358,995 2,678,143 680,852
Capital grants and contributions 2,493,473 3,321,767 (828,294) - - - 2,493,473 3,321,767 (828,294)
General Revenues:
Real Estate and personal property taxes 20,904,576 20,162,546 742,030 - - - 20,904,576 20,162,546 742,030
Tax Liens 25,881 132,141 (106,260) - - - 25,881 132,141 (106,260)
Motor vehicle and other excise taxes 1,197,764 1,306,954 (109,190) - - - 1,197,764 1,306,954 (109,190)
Hotel/Motel Tax 485,057 474,344 10,713 - - - 485,057 474,344 10,713
Penalties and interest on taxes 85,066 104,018 (18,952) - - - 85,066 104,018 (18,952)
Payments in Lieu of Taxes 6,781 6,784 (3) - - - 6,781 6,784 (3)
Nonrestricted grants and contributions 1,069,211 704,035 365,176 - - - 1,069,211 704,035 365,176
Unrestricted investment income 680,426 489,894 190,532 - - - 680,426 489,894 190,532
Other revenues 49,699 12,061 37,638 - - - 49,699 12,061 37,638
Total Revenues 32,157,490 31,002,084 1,155,406 6,050,003 5,680,143 369,860 38,207,493 36,682,227 1,525,266
Expenses:
General Government 2,439,906 2,468,687 (28,781) - - - 2,439,906 2,468,687 (28,781)
Public Safety 4,310,882 4,045,173 265,709 - - - 4,310,882 4,045,173 265,709
Education 15,358,192 14,421,539 936,653 - - - 15,358,192 14,421,539 936,653
Public Works 1,704,438 2,544,630 (840,192) - - - 1,704,438 2,544,630 (840,192)
Human Services 472,880 513,411 (40,531) - - - 472,880 513,411 (40,531)
Culture and Recreation 676,103 599,541 76,562 - - - 676,103 599,541 76,562
Employee Benefits 3,652,933 3,283,397 369,536 - - - 3,652,933 3,283,397 369,536
State and County Assessments 432,568 469,867 (37,299) - - - 432,568 469,867 (37,299)
Interest 314,205 506,232 (192,027) - - - 314,205 506,232 (192,027)
Golf - - - 3,330,443 3,135,704 194,739 3,330,443 3,135,704 194,739
Water - - - 1,605,193 1,613,093 (7,900) 1,605,193 1,613,093 (7,900)
Total Expenses 29,362,107 28,852,477 509,630 4,935,636 4,748,797 186,839 34,297,743 33,601,274 696,469
Change in Net Assets before Transfers 2,795,383 2,149,607 645,776 1,114,367 931,346 183,021 3,909,750 3,080,953 828,797
Transfers 811,276 884,950 (73,674) (811,276) (884,950) 73,674 - - -
Change in Net Assets 3,606,659 3,034,557 572,102 303,091 46,396 256,695 3,909,750 3,080,953 828,797
Net Assets - beginning 59,981,332 56,946,775 3,034,557 11,204,425 11,158,029 46,396 71,185,757 68,104,804 3,080,953
Net Assets - ending 63,587,991$ 59,981,332$ 3,606,659 11,507,516$ 11,204,425$ 303,091 75,095,507$ 71,185,757$ 3,909,750
Total
Primary
Government
TOWN OF BREWSTER - FINANCIAL HIGHLIGHTS
Governmental
Activities
Business-type
Activities
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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
$14,237,912, a $3.58 million increase from the prior year’s ending fund balance.
The general fund is the primary operating fund. At the end of the current fiscal year, unreserved fund balance of
the general fund was $4,547,129, while total fund balance stood at $5,586,822. 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 15.67% of total general fund expenditures, while total fund
balance represents 19.25% of that same amount.
The stabilization fund has accumulated a fund balance of $3,040,998, which represents 10.5% of general fund
expenditures: $1.0 million of the total fund balance has been committed for compliance with the requirements of
GASB Statement No. 45. 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 $995,909 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 $26 million in revenues and $30 in
expenditures, drawing on transfers and prior year’s surplus to finance the difference. At year end, $760,822 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, 2007, amounts to $74,320,528, net of accumulated depreciation. The investment in capital assets
includes land, buildings and improvements, improvements (other than buildings), machinery,equipment and
vehicles, infrastructure, and construction in progress.
The governmental activities capital assets (net of accumulated depreciation) were increased by $2,219,649 during
the current fiscal year while the business-type activities capital assets (net of accumulated depreciation) decreased
by $488,325. Total depreciation was $2.0 million, resulting in a total government-wide increase to capital assets
(net of accumulated depreciation) of $1,731,324.
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Increase Increase Increase
FY 2007 FY 2006 (Decrease) FY 2007 FY 2006 (Decrease) FY 2007 FY 2006 (Decrease)
Land 32,287,512$ 30,162,512$ 2,125,000$ 2,874,212$ 2,874,212$ -$ 35,161,724$ 33,036,724$ 2,125,000$
Construction in Progress 10,349 177,118 (166,769) 32,240 769,134 (736,894) 42,589 946,252 (903,663)
Buildings and improvements 17,294,841 17,521,660 (226,819) 2,050,123 2,109,788 (59,665) 19,344,964 19,631,448 (286,484)
Improvements (other than buildings)562,951 579,709 (16,758) 662,607 622,724 39,883 1,225,558 1,202,433 23,125
Machinery, Equipment, and Vehicles 3,040,810 2,335,636 705,174 - - - 3,040,810 2,335,636 705,174
Infrastructure 1,657,136 1,857,315 (200,179) 13,847,747 13,579,396 268,351 15,504,883 15,436,711 68,172
Total Capital Assets 54,853,599$ 52,633,950$ 2,219,649$ 19,466,929$ 19,955,254$ (488,325)$ 74,320,528$ 72,589,204$ 1,731,324$
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, 2007, totaled $23,478,605. Within this total, business-type activities have debt of
$11,896,000 that is fully supported by their respective program revenues, and governmental activities debt is
$11,582,605. Total debt consists of the following:
Outstanding Outstanding
Governmental Activities June 30, 2007 June 30, 2006
School Construction 3,870,000$ 4,225,000$
Library Construction 460,000 500,000
MWPAT Title V - Sewer 166,204 175,729
Road Betterments - Blueberry Rd 31,000 46,500
Road Betterments - Beach Plum Rd 45,000 60,000
Police Station 2,220,000 2,380,000
Road Betterments - Highlands Rd 40,000 55,000
Road Betterments - Millstone Rd 165,000 195,000
Road Betterments - Commons Way Rd 140,000 160,000
Road Betterments - Meetinghouse Rd 195,000 225,000
MWPAT #97-1156 Title V - Sewer 145,401 155,802
Land Purchase 880,000 945,000.00
Road Betterments - Kings Grant Road 270,000 307,000.00
Road Betterments - Barons Way Road 150,000 170,000.00
Land Purchase 2,500,000 -
Road Betterments - Fiddler's Lane 180,000 -
Road Betterments - Herringbrook Lane 125,000 -
Total Governmental Activities 11,582,605$ 9,600,031$
Outstanding Outstanding
Business-type Activities June 30, 2007 June 30, 2006
Golf Course 7,490,000$ 7,885,000$
Golf Course Irrigation 700,000 800,000.00
Water Mains 1,975,000 2,120,000
Telemetry System 55,000 75,000
Water Betterments - Sears Road - 5,000
Water Betterments - Williams Drive 20,000 25,000
Standpipe #2 350,000 425,000
Standpipe Rehabilitation 500,000 575,000
Slough Road 710,000 750,000
Water Betterments - Fiddler's Lane 96,000 -
Total Business-type Activities 11,896,000$ 12,660,000$
Grand Total - All long-term debt 23,478,605$ 22,260,031$
Outstanding Debt at Year End
Please refer to Notes 5 and 8 for further discussion of the major capital asset and debt activity.
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Economic Factors and Next Year’s Budgets & Rates
The Town’s leadership (elected and appointed officials) considered many factors when setting the fiscal 2008
budget and tax rates including the following:
• The debt obligation of the Town was lessened by a refunding issue which produced a savings of over $700
thousand over the life of the associated bonds. In Fiscal 2007, the recognized savings were $220 thousand.
• The Board of Water Commissioners received an affirmative vote in fiscal 2007 to bond $2.475 million for the
relocation of the Water Department operations. Bonds will be issued in June of 2008 in the amount of $2.475
million for this project. The associated debt will be paid through Water Rates. Completion of this
construction is expected by the end of calendar 2008.
• The fiscal 2008 tax rate was set at $5.55, a .02 cent increase over fiscal 2007. The excess levy capacity was
$232,757.
• The Board of Selectmen voted during their classification hearing to maintain the same tax rate for all classes
of property.
• Massachusetts School Building Authority finalized the Eddy School audit. The Eddy School grant payments
from the state have increased by $78 thousand per year while shortening the payment period by three years.
Final payment from the Authority will be in fiscal 2016.
• The Town purchased Open Space properties in fiscal 2006 and 2007 with funds from the Community
Preservation Act, Grants from the State, and the Dennis Water District. This was a joint venture, ultimately
insuring the protection of both Town’s watershed areas. The total purchase price was $4,250,000, however,
after applying the grant funds and $1 million from the Dennis Water District, permanent bonding is
$2,500,000. Community Preservation is the funding source for the total debt obligation..
• CPA/Open Space funds also purchased two (2) parcels in FY08. After receiving Self Help Grant funds,
Conservation Restrictions and contributions from the Museum of Natural History, the net purchase price
totals $770,000 for approximately 16 acres of protected land.
• Fiscal 2008 budget constraints are the increase in Health Care Costs, Pension obligations and anticipation of
State Aid. The Town has instituted a change in the Union Contracts to reduce the Town’s contribution to the
Indemnity Health Plans from 75% to 65%. MSBA reimbursement for a school roof allowed the Town to set
aside $1 million towards GASB45/OPEB funding.
Request for Information
This financial report is designed to provide a general overview of the Town of Brewster’s finances for all those
with an interest in the government’s finances. Questions concerning any of the information provided in this
report or request for additional financial information should be addressed to the Finance Director, 2198 Main
Street, Brewster, MA 02631.
GOVERNMENTAL BUSINESS-TYPE
ACTIVITIES ACTIVITIES TOTAL
ASSETS
CURRENT:
CASH AND SHORT-TERM INVESTMENTS 16,710,731$ 4,111,386$ 20,822,117$
RECEIVABLES, NET OF ALLOWANCE FOR UNCOLLECTIBLES:
REAL ESTATE AND PERSONAL PROPERTY TAXES 272,841 - 272,841
TAX LIENS 378,611 - 378,611
MOTOR VEHICLE EXCISE TAXES 84,680 - 84,680
USER FEES - 62,799 62,799
DEPARTMENTAL AND OTHER 133,031 - 133,031
INTERGOVERNMENTAL 1,492,902 - 1,492,902
SPECIAL ASSESSMENTS 81,067 2,719 83,786
DEFERRED AMOUNT ON REFUNDING 9,658 769 10,427
NONCURRENT:
RECEIVABLES, NET OF ALLOWANCE FOR UNCOLLECTIBLES:
INTERGOVERNMENTAL 3,812,872 - 3,812,872
SPECIAL ASSESSMENTS 696,462 17,885 714,347
DEFERRED AMOUNT ON REFUNDING 80,342 9,231 89,573
CAPITAL ASSETS, NET OF ACCUMULATED DEPRECIATION 54,853,599 19,466,929 74,320,528
TOTAL ASSETS 78,606,796 23,671,718 102,278,514
LIABILITIES
CURRENT:
ACCOUNTS PAYABLE 1,642,918 118,230 1,761,148
OTHER LIABILITIES 250 - 250
ACCRUED INTEREST 138,032 149,972 288,004
BONDS AND NOTES PAYABLE 1,980,429 906,000 2,886,429
LANDFILL POSTCLOSURE CARE COSTS 57,000 - 57,000
NONCURRENT:
BONDS AND NOTES PAYABLE 10,477,176 10,990,000 21,467,176
LANDFILL POSTCLOSURE CARE COSTS 723,000 - 723,000
TOTAL LIABILITIES 15,018,805 12,164,202 27,183,007
NET ASSETS
INVESTED IN CAPITAL ASSETS, NET OF RELATED DEBT 49,024,255 7,591,533 56,615,788
RESTRICTED FOR:
STREETS 937,857 - 937,857
PERMANENT FUNDS:
EXPENDABLE 101,298 - 101,298
NONEXPENDABLE 107,763 - 107,763
OTHER PURPOSES 1,840,911 - 1,840,911
UNRESTRICTED 11,575,907 3,915,983 15,491,890
TOTAL NET ASSETS 63,587,991$ 11,507,516$ 75,095,507$
See accompanying notes to the basic financial statements
PRIMARY GOVERNMENT
TOWN OF BREWSTER, MASSACHUSETTS
STATEMENT OF NET ASSETS
JUNE 30, 2007
- 9 -
OPERATING CAPITALCHARGES FORGRANTS AND GRANTS AND NET (EXPENSE)FUNCTIONS/PROGRAMSEXPENSES SERVICES CONTRIBUTIONS CONTRIBUTIONS REVENUEPRIMARY GOVERNMENT:GOVERNMENTAL ACTIVITIES:GENERAL GOVERNMENT 2,439,906$ 268,878$ 181,466$ 2,223,309$ 233,747$ PUBLIC SAFETY 4,310,882 387,248 1,294,111 - (2,629,523) EDUCATION 15,358,192 113,427 1,039,650 (773,679) (14,978,794) PUBLIC WORKS 1,704,438 719,835 38,928 787,638 (158,037) HUMAN SERVICES 472,880 86,719 32,450 16,205 (337,506) CULTURE & RECREATION 676,103 308,946 95,841 240,000 (31,316) EMPLOYEE BENEFITS 3,652,933 - 592,057 - (3,060,876) STATE & COUNTY ASSESSMENTS 432,568 - - - (432,568) INTEREST 314,205 - - - (314,205) TOTAL GOVERNMENTAL ACTIVITIES 29,362,107 1,885,053 3,274,503 2,493,473 (21,709,078) BUSINESS-TYPE ACTIVITIES:GOLF 3,330,443 4,161,461 14,060 - 845,078 WATER 1,605,193 1,804,050 70,432 - 269,289 TOTAL BUSINESS-TYPE ACTIVITIES 4,935,636 5,965,511 84,492 - 1,114,367 TOTAL PRIMARY GOVERNMENT34,297,743$ 7,850,564$ 3,358,995$ 2,493,473$ (20,594,711)$ (continued)See accompanying notes to the basic financial statements PROGRAM REVENUESTOWN OF BREWSTER, MASSACHUSETTSSTATEMENT OF ACTIVITIESFISCAL YEAR ENDED JUNE 30, 2007- 10 -
GOVERNMENTAL BUSINESS-TYPEACTIVITIESACTIVITIES TOTALCHANGES IN NET ASSETS:NET (EXPENSE) REVENUE FROM PREVIOUS PAGE (21,709,078)$ 1,114,367$ (20,594,711)$ GENERAL REVENUES:REAL ESTATE AND PERSONAL PROPERTY TAXES,NET OF TAX REFUNDS PAYABLE 20,904,576 - 20,904,576 TAX LIENS 25,881 - 25,881 MOTOR VEHICLE AND OTHER EXCISE TAXES 1,197,764 - 1,197,764 HOTEL/MOTEL TAX 485,057 - 485,057 PENALTIES AND INTEREST ON TAXES 85,066 - 85,066 PAYMENTS IN LIEU OF TAXES 6,781 - 6,781 GRANTS AND CONTRIBUTIONS NOT RESTRICTEDTO SPECIFIC PROGRAMS 1,069,211 - 1,069,211 UNRESTRICTED INVESTMENT INCOME 680,426 - 680,426 MISCELLANEOUS 49,699 - 49,699 TRANSFERS, NET 811,276 (811,276) - TOTAL GENERAL REVENUES AND TRANSFERS 25,315,737 (811,276) 24,504,461 CHANGE IN NET ASSETS 3,606,659 303,091 3,909,750 NET ASSETS:BEGINNING OF YEAR59,981,332 11,204,425 71,185,757 END OF YEAR63,587,991$ 11,507,516$ 75,095,507$ (concluded)See accompanying notes to the basic financial statements PRIMARY GOVERNMENTTOWN OF BREWSTER, MASSACHUSETTSSTATEMENT OF ACTIVITIESFISCAL YEAR ENDED JUNE 30, 2007- 11 -
TOWN OF BREWSTER, MASSACHUSETTSGOVERNMENTAL FUNDSBALANCE SHEETJUNE 30, 2007 NONMAJOR TOTALCOMMUNITY STABILIZATION GOVERNMENTAL GOVERNMENTALASSETSGENERAL PRESERVATION FUND FUNDS FUNDSCASH AND SHORT-TERM INVESTMENTS 6,940,373$ 3,424,502$ 3,040,998$ 3,304,858$ 16,710,731$ RECEIVABLES, NET OF ALLOWANCE FOR UNCOLLECTIBLES:REAL ESTATE AND PERSONAL PROPERTY TAXES 272,841 - - - 272,841 TAX LIENS 378,611 - - - 378,611 MOTOR VEHICLE EXCISE TAXES 84,680 - - - 84,680 DEPARTMENTAL AND OTHER - 14,572 - 118,459 133,031 INTERGOVERNMENTAL 4,357,568 - - 948,206 5,305,774 SPECIAL ASSESSMENTS - - - 777,529 777,529 TOTAL ASSETS12,034,073$ 3,439,074$ 3,040,998$ 5,149,052$ 23,663,197$ LIABILITIES AND FUND BALANCESLIABILITIES:ACCOUNTS PAYABLE 1,388,301$ 8,737$ -$ 245,880$ 1,642,918$ OTHER LIABILITIES 250 - - - 250 DEFERRED REVENUES 5,058,700 14,572 - 1,833,845 6,907,117 NOTES PAYABLE - 875,000 - - 875,000 TOTAL LIABILITIES6,447,251 898,309 - 2,079,725 9,425,285 FUND BALANCES:RESERVED FOR:ENCUMBRANCES AND CONTINUING APPROPRIATIONS 1,039,693 - - - 1,039,693 PERPETUAL PERMANENT FUNDS - - - 107,763 107,763 UNRESERVEDDESIGNATED FOR SUBSEQUENT YEARS' EXPENDITURES 1,173,257 - - - 1,173,257 UNDESIGNATED REPORTED IN:GENERAL FUND 3,373,872 - - - 3,373,872 SPECIAL REVENUE FUNDS - - 3,040,998 2,778,768 5,819,766 CAPITAL PROJECTS FUNDS - 2,540,765 - 81,498 2,622,263 PERMANENT FUNDS - - - 101,298 101,298 TOTAL FUND BALANCES5,586,822 2,540,765 3,040,998 3,069,327 14,237,912 TOTAL LIABILITIES AND FUND BALANCES12,034,073$ 3,439,074$ 3,040,998$ 5,149,052$ 23,663,197$ See accompanying notes to the basic financial statements - 12 -
NONMAJOR TOTALCOMMUNITY STABILIZATION GOVERNMENTAL GOVERNMENTALGENERAL PRESERVATION FUND FUNDS FUNDSREVENUES:REAL ESTATE AND PERSONAL PROPERTY TAXES,NET OF TAX REFUNDS 20,885,607$ -$ -$ -$ 20,885,607$ MOTOR VEHICLE AND OTHER EXCISE TAXES 1,218,699 - - - 1,218,699 INTERGOVERNMENTAL 3,089,455 1,597,364 - 853,731 5,540,550 PAYMENTS IN LIEU OF TAXES 6,781 - - - 6,781 PENALTIES & INTEREST ON TAXES 65,315 - - - 65,315 FINES & FORFEITS 45,918 - - - 45,918 CHARGES FOR SERVICES 743,328 - - 1,277,950 2,021,278 HOTEL/MOTEL TAX 485,057 - - - 485,057 INVESTMENT INCOME 502,996 139,723 138,127 52,714 833,560 CONTRIBUTIONS AND DONATIONS - - - 45,830 45,830 DEPARTMENTAL AND OTHER 990,444 623,775 - 129,322 1,743,541 TOTAL REVENUES 28,033,600 2,360,862 138,127 2,359,547 32,892,136 EXPENDITURES:CURRENT:GENERAL GOVERNMENT 2,281,189 2,277,431 - 30,573 4,589,193 PUBLIC SAFETY 4,007,118 - - 472,900 4,480,018 EDUCATION 14,759,400 - - 559,091 15,318,491 PUBLIC WORKS 1,651,384 - - 398,425 2,049,809 HUMAN SERVICES 487,951 - - 34,732 522,683 CULTURE & RECREATION 592,602 - - 86,754 679,356 EMPLOYEE BENEFITS 3,652,933 - - - 3,652,933 STATE & COUNTY ASSESSMENTS 432,568 - - - 432,568 DEBT SERVICE 1,150,089 - - 49,372 1,199,461 TOTAL EXPENDITURES 29,015,234 2,277,431 - 1,631,847 32,924,512 EXCESS (DEFICIENCY) OF REVENUES OVER EXPENDITURES(981,634) 83,431 138,127 727,700 (32,376) OTHER FINANCING SOURCES (USES)PROCEEDS FROM BONDS AND NOTES - 2,500,000 - 305,000 2,805,000 PROCEEDS FROM REFUNDING BONDS 12,920,000 - - - 12,920,000 BOND REFUNDING PREMIUM NET OF COSTS 488,156 - - - 488,156 PAYMENTSTO REFUNDED BOND ESCROW AGENT (13,408,156) - - - (13,408,156) OPERATING TRANSFERS IN 1,960,158 - 1,000,000 42,064 3,002,222 OPERATING TRANSFERS OUT (1,042,064) (98,174) - (1,050,708) (2,190,946) TOTAL OTHER FINANCING SOURCES (USES) 918,094 2,401,826 1,000,000 (703,644) 3,616,276 NET CHANGE IN FUND BALANCES(63,540) 2,485,257 1,138,127 24,056 3,583,900 FUND BALANCES AT BEGINNING OF YEAR5,650,362 55,508 1,902,871 3,045,271 10,654,012 FUND BALANCES AT END OF YEAR5,586,822$ 2,540,765$ 3,040,998$ 3,069,327$ 14,237,912$ 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, 2007- 13 -
TOTAL GOVERNMENTAL FUND BALANCES 14,237,912$
CAPITAL ASSETS (NET) USED IN GOVERNMENTAL ACTIVITIES ARE NOT FINANCIAL RESOURCES
AND, THEREFORE, ARE NOT REPORTED IN THE FUNDS 54,853,599
ACCOUNTS RECEIVABLE ARE NOT AVAILABLE TO PAY FOR CURRENT-PERIOD
EXPENDITURES AND, THEREFORE, ARE DEFERRED IN THE FUNDS 6,907,117
IN THE STATEMENT OF ACTIVITIES, INTEREST IS ACCRUED ON OUTSTANDING LONG-TERM DEBT,
WHEREAS IN GOVERNMENTAL FUNDS INTEREST IS NOT REPORTED UNTIL DUE (138,032)
BONDS AND NOTES PAYABLE (11,582,605)
DEFERRED AMOUNT ON REFUNDING 90,000
LANDFILL POSTCLOSURE CARE COSTS (780,000)
NET EFFECT OF REPORTING LONG-TERM LIABILITIES (12,272,605)
NET ASSETS OF GOVERNMENTAL ACTIVITIES 63,587,991$
See accompanying notes to the basic financial statements
TOWN OF BREWSTER, MASSACHUSETTS
RECONCILIATION OF THE GOVERNMENTAL FUNDS BALANCE SHEET
TOTAL FUND BALANCES TO THE STATEMENT OF NET ASSETS
FISCAL YEAR ENDED JUNE 30, 2007
- 14 -
NET CHANGE IN FUND BALANCES - TOTAL GOVERNMENTAL FUNDS 3,583,900$
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 1,315,381
DEPRECIATION EXPENSE 904,268
NET EFFECT OF REPORTING CAPITAL ASSETS 2,219,649
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 (734,646)
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.
PROCEEDS FROM BONDS AND NOTES (2,895,000)
PROCEEDS FROM REFUNDING 13,408,156
PAYMENTS TO REFUND BOND ESCROW AGENT (13,408,156)
DEBT SERVICE PRINCIPAL PAYMENTS 912,426
DEFERRED AMOUNT ON REFUNDING 90,000
NET EFFECT OF REPORTING LONG-TEM DEBT (1,892,574)
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 POSTCLOSURE CARE ACCRUAL 457,500
NET CHANGE IN ACCRUED INTEREST ON LONG-TERM DEBT (27,170)
NET EFFECT OF RECORDING LONG-TERM LIABILITIES 430,330
CHANGE IN NET ASSETS OF GOVERNMENTAL ACTIVITIES 3,606,659$
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, 2007
- 15 -
ACTUAL
ORIGINAL FINAL BUDGETARY VARIANCE
BUDGET BUDGET AMOUNTS OVER(UNDER)
REVENUES:
REAL ESTATE AND PERSONAL PROPERTY TAXES,
NET OF TAX REFUNDS 20,698,900$ 20,698,900$ 20,885,607$ 186,707$
MOTOR VEHICLE AND OTHER EXCISE TAXES 1,128,000 1,128,000 1,218,699 90,699
INTERGOVERNMENTAL 2,455,877 2,455,877 2,481,192 25,315
PAYMENTS IN LIEU OF TAXES 6,800 6,800 6,781 (19)
PENALTIES & INTEREST ON TAXES 47,000 47,000 65,315 18,315
FINES & FORFEITS 24,000 24,000 45,918 21,918
HOTEL/MOTEL TAX 420,000 420,000 485,057 65,057
INVESTMENT INCOME 80,000 80,000 502,996 422,996
DEPARTMENTAL AND OTHER 1,358,500 1,358,500 1,733,772 375,272
TOTAL REVENUES 26,219,077 26,219,077 27,425,337 1,206,260
EXPENDITURES:
CURRENT:
GENERAL GOVERNMENT 2,652,033 2,841,310 2,743,217 98,093
PUBLIC SAFETY 4,050,241 4,292,828 4,161,144 131,684
EDUCATION 14,692,748 14,801,433 14,790,619 10,814
PUBLIC WORKS 1,704,188 2,068,559 1,854,804 213,755
HUMAN SERVICES 504,186 516,175 496,725 19,450
CULTURE & RECREATION 598,363 638,763 627,099 11,664
EMPLOYEE BENEFITS 3,023,899 3,062,499 3,060,876 1,623
STATE & COUNTY ASSESSMENTS 486,187 486,187 432,568 53,619
DEBT SERVICE 1,354,553 1,354,553 1,134,433 220,120
TOTAL EXPENDITURES 29,066,398 30,062,307 29,301,485 760,822
EXCESS (DEFICIENCY) OF REVENUES OVER EXPENDITURES (2,847,321) (3,843,230) (1,876,148) 1,967,082
OTHER FINANCING SOURCES (USES):
OPERATING TRANSFERS IN 1,157,414 1,353,717 1,960,158 606,441
OPERATING TRANSFERS OUT (111,783) (1,131,450) (1,042,064) 89,386
TOTAL OTHER FINANCING SOURCES (USES) 1,045,631 222,267 918,094 695,827
NET CHANGE IN FUND BALANCE (1,801,690) (3,620,963) (958,054) 2,662,909
BUDGETARY FUND BALANCE, BEGINNING OF YEAR 5,480,920 5,480,920 5,480,920 -
BUDGETARY FUND BALANCE, END OF YEAR 3,679,230$ 1,859,957$ 4,522,866$ 2,662,909$
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
FISCAL YEAR ENDED JUNE 30, 2007
- 16 -
ASSETS GOLF WATER TOTAL
CURRENT:
CASH AND SHORT-TERM INVESTMENTS 883,638$ 3,227,748$ 4,111,386$
USER FEES, NET OF ALLOWANCE FOR UNCOLLECTIBLES: - 62,799 62,799
SPECIAL ASSESSMENTS - 2,719 2,719
DEFERRED AMOUNT ON REFUNDING - 769 769
TOTAL CURRENT ASSETS 883,638 3,294,035 4,177,673
NONCURRENT:
SPECIAL ASSESSMENTS - 17,885 17,885
DEFERRED AMOUNT ON REFUNDING - 9,231 9,231
CAPITAL ASSETS, NET OF ACCUMULATED DEPRECIATION 10,896,918 8,570,011 19,466,929
TOTAL NONCURRENT ASSETS 10,896,918 8,597,127 19,494,045
TOTAL ASSETS 11,780,556 11,891,162 23,671,718
LIABILITIES
CURRENT:
ACCOUNTS PAYABLE 94,371 23,859 118,230
ACCRUED INTEREST 94,336 55,636 149,972
BONDS AND NOTES PAYABLE 520,000 386,000 906,000
TOTAL CURRENT LIABILITIES 708,707 465,495 1,174,202
NONCURRENT:
BONDS AND NOTES PAYABLE 7,670,000 3,320,000 10,990,000
TOTAL LIABILITIES 8,378,707 3,785,495 12,164,202
NET ASSETS
INVESTED IN CAPITAL ASSETS, NET OF RELATED DEBT 2,706,918 4,884,615 7,591,533
UNRESTRICTED 694,931 3,221,052 3,915,983
TOTAL NET ASSETS 3,401,849$ 8,105,667$ 11,507,516$
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, 2007
- 17 -
GOLF WATER TOTAL
OPERATING REVENUES:
CHARGES FOR SERVICES 4,161,461$ 1,804,050$ 5,965,511$
DEPARTMENTAL AND OTHER 14,060 70,432 84,492
TOTAL OPERATING REVENUES 4,175,521 1,874,482 6,050,003
OPERATING EXPENSES:
GENERAL SERVICES 2,428,756 1,097,233 3,525,989
DEPRECIATION 432,453 335,966 768,419
TOTAL OPERATING EXPENSES 2,861,209 1,433,199 4,294,408
OPERATING INCOME (LOSS) 1,314,312 441,283 1,755,595
NON-OPERATING REVENUES (EXPENSES):
INTEREST EXPENSE (469,234) (171,994) (641,228)
INCOME (LOSS) BEFORE OPERATING TRANSFERS 845,078 269,289 1,114,367
OPERATING TRANSFERS:
OPERATING TRANSFERS OUT (601,317) (209,959) (811,276)
CHANGE IN NET ASSETS 243,761 59,330 303,091
NET ASSETS AT BEGINNING OF YEAR 3,158,088 8,046,337 11,204,425
NET ASSETS AT END OF YEAR 3,401,849$ 8,105,667$ 11,507,516$
See accompanying notes to the basic financial statements
BUSINESS TYPE ACTIVITIES - ENTERPRISE FUNDS
TOWN OF BREWSTER, MASSACHUSETTS
PROPRIETARY FUNDS
STATEMENT OF REVENUES, EXPENSES, AND CHANGES IN FUND NET ASSETS
FISCAL YEAR ENDED JUNE 30, 2007
- 18 -
GOLF WATER TOTAL
CASH FLOWS FROM OPERATING ACTIVITIES:
RECEIPTS FROM CUSTOMERS AND USERS 4,175,521$ 1,875,494$ 6,051,015$
PAYMENTS TO SUPPLIERS (1,257,157) (555,165) (1,812,322)
PAYMENTS TO EMPLOYEES (1,077,228) (584,922) (1,662,150)
NET CASH PROVIDED (USED) BY OPERATING ACTIVITIES 1,841,136 735,407 2,576,543
CASH FLOWS FROM NONCAPITAL FINANCING ACTIVITIES:
OPERATING TRANSFERS OUT (601,317) (209,959) (811,276)
NET CASH PROVIDED (USED) BY NONCAPITAL FINANCING ACTIVITIES (601,317) (209,959) (811,276)
CASH FLOWS FROM CAPITAL AND RELATED FINANCING ACTIVITIES:
PROCEEDS FROM THE ISSUANCE OF BONDS AND NOTES - 96,000 96,000
PRINCIPAL PAYMENTS ON BONDS AND NOTES (495,000) (375,000) (870,000)
ACQUISITION AND CONSTRUCTION OF CAPITAL ASSETS (169,989) (110,105) (280,094)
INTEREST EXPENSE (399,623) (182,730) (582,353)
NET CASH PROVIDED (USED) BY CAPITAL AND RELATED FINANCING ACTIVITIES (1,064,612) (571,835) (1,636,447)
NET INCREASE (DECREASE) IN CASH AND SHORT TERM INVESTMENTS 175,207 (46,387) 128,820
CASH AND SHORT TERM INVESTMENTS - BEGINNING OF YEAR 708,431 3,274,135 3,982,566
CASH AND SHORT TERM INVESTMENTS- END OF YEAR 883,638$ 3,227,748$ 4,111,386$
RECONCILIATION OF OPERATING INCOME (LOSS)
TO NET CASH PROVIDED (USED) BY OPERATING ACTIVITIES:
OPERATING INCOME (LOSS)1,314,312$ 441,283$ 1,755,595$
ADJUSTMENTS TO RECONCILE OPERATING INCOME (LOSS)
TO NET CASH PROVIDED (USED) BY OPERATING ACTIVITIES:
DEPRECIATION 432,453 335,966 768,419
(INCREASE) DECREASE IN ACCOUNTS RECEIVABLE - 1,012 1,012
INCREASE (DECREASE) IN ACCOUNTS PAYABLE 94,371 (42,529) 51,842
INCREASE (DECREASE) IN OTHER LIABILITIES - (325) (325)
TOTAL ADJUSTMENTS 526,824 294,124 820,948
NET CASH PROVIDED (USED) BY OPERATING ACTIVITIES 1,841,136$ 735,407$ 2,576,543$
See accompanying notes to the basic financial statements
BUSINESS TYPE ACTIVITIES - ENTERPRISE FUNDS
TOWN OF BREWSTER, MASSACHUSETTS
PROPRIETARY FUNDS
STATEMENT OF CASH FLOWS
FISCAL YEAR ENDED JUNE 30, 2007
- 19 -
PRIVATE
PURPOSE AGENCY
TRUST FUNDS FUNDS
ASSETS
CASH AND SHORT-TERM INVESTMENTS 65,232$ 201,642$
DEPARTMENTAL RECEIVABLE - 16,337
TOTAL ASSETS 65,232 217,979
LIABILITIES
ACCOUNTS PAYABLE - 10,478
OTHER LIABILITIES - 207,501
TOTAL LIABILITIES - 217,979
NET ASSETS
HELD IN TRUST FOR OTHER PURPOSES 65,232$ -$
See accompanying notes to the basic financial statements
TOWN OF BREWSTER, MASSACHUSETTS
FIDUCIARY FUNDS
STATEMENT OF FIDUCIARY NET ASSETS
JUNE 30, 2007
- 20 -
PRIVATE
PURPOSE
TRUST FUNDS
ADDITIONS:
INVESTMENT INCOME: 2,195$
DEDUCTIONS:-
CHANGE IN NET ASSETS 2,195
NET ASSETS AT BEGINNING OF YEAR 63,037
NET ASSETS AT END OF YEAR 65,232$
See accompanying notes to the basic financial statements
TOWN OF BREWSTER, MASSACHUSETTS
FIDUCIARY FUNDS
STATEMENT OF CHANGES IN FIDUCIARY NET ASSETS
FISCAL YEAR ENDED JUNE 30, 2007
- 21 -
TOWN OF BREWSTER, MASSACHUSETTS
NOTES TO BASIC FINANCIAL STATEMENTS
JUNE 30, 2007
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 $ 8,120,965
School District Orleans, MA 02653
Cape Cod Regional
Technical High
School
To provide vocational education 351 Pleasant Lake Ave
Harwich, MA 02645
$ 717,052
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 49.22% equity interest in the joint
venture.
- 22 -
TOWN OF BREWSTER, MASSACHUSETTS
NOTES TO BASIC FINANCIAL STATEMENTS
JUNE 30, 2007
- 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 activities)
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, 2007
- 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, 2007
- 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 Community Preservation fund is a special revenue fund used to account for the accumulation
of resources to purchase open space, assist in development of affordable housing, and
preservation of historic property.
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 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, 2007
- 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, 2007
- 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 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, 2007
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) and
construction in progress, 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, 2007
- 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, 2007
- 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, 2007
- 31 -
Fund balances have been designated for the following:
• Subsequent year's expenditures represents amounts appropriated for the fiscal year 2008
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, 2007
- 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, 2007, this expense/expenditure totaled
approximately $226,683. There were approximately 68 participants eligible to receive benefits at
June 30, 2007.
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, 2007
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 2007 approved budget authorized
$27,847,372 in current year appropriations and other amounts to be raised and $1,219,026 in carryover
articles carried over from previous fiscal years. Supplemental appropriations of $995,909 were approved
at two Special Town Meetings for fiscal year 2007.
The Finance Director has the responsibility to ensure that budgetary controls are maintained and
monitored through the accounting system.
B. Budgetary – GAAP Reconciliation
For budgetary financial reporting purposes, the Uniform Municipal Accounting System basis of
accounting (established by the Commonwealth) is followed, which differs from the GAAP basis of
accounting. A reconciliation of budgetary-basis to GAAP-basis results for the general fund for the fiscal
year ended June 30, 2007, is presented below:
Net change in fund balance - budgetary basis (958,054)$
Basis of accounting differences:
Increase in revenue for on-behalf payments - MTRS 592,057
Increase in expenditures for on-behalf payments - MTRS (592,057)
Increase in revenue for the MWPAT subsidy 16,205
Increase in expenditures for the MWPAT subsidy (16,205)
Adjustment for current year articles 929,485
Adjustment for current year encumbrances 110,019
Adjustment for expenditures from prior year encumbrances (144,990)
Net change in fund balance - GAAP basis (63,540)$
- 33 -
TOWN OF BREWSTER, MASSACHUSETTS
NOTES TO BASIC FINANCIAL STATEMENTS
JUNE 30, 2007
- 34 -
C. Deficit Fund Balances
Several individual fund deficits exist within the special revenue and capital project funds. These
individual deficits will be eliminated through subsequent fiscal year budget transfers, grants, and/or
proceeds from long-term debt during fiscal year 2008.
NOTE 3 – DEPOSITS AND INVESTMENTS
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.
Custodial Credit Risk - Deposits
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, 2007, the bank balances of uninsured and
uncollateralized deposits are $1,533,461.
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.
The Town did not hold or own any fixed income securities as of June 30, 2007.
Custodial Credit Risk – Investments
For an investment, this is the risk that, in the event of a failure by the counterparty, the Town will not be
able to recover the value of its investments or collateral security that are in possession of an outside party.
The Town does not have an investment policy for custodial credit risk.
Credit Risk
The Town has not adopted a formal policy related to Credit Risk.
TOWN OF BREWSTER, MASSACHUSETTS
NOTES TO BASIC FINANCIAL STATEMENTS
JUNE 30, 2007
NOTE 4 – RECEIVABLES
The receivables at June 30, 2007 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 275,541$ (2,700)$ 272,841$
Tax liens 378,611 - 378,611
Motor vehicle and other excise taxes 116,151 (31,471) 84,680
Departmental and other 250,895 (101,527) 149,368
Intergovernmental 5,305,774 - 5,305,774
Special assessments 777,529 - 777,529
Total 7,104,501$ (135,698)$ 6,968,803$
The receivables at June 30, 2007, for the enterprise funds consist of the following:
Allowance
Gross for Net
Receivables:Amount Uncollectibles Amount
Water
User fees 62,799$ -$ 62,799$
Special Assessments 20,604 - 20,604
Total 83,403$ -$ 83,403$
- 35 -
TOWN OF BREWSTER, MASSACHUSETTS
NOTES TO BASIC FINANCIAL STATEMENTS
JUNE 30, 2007
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 Community Governmental
Receivable Type:Fund Preservation Funds Total
Property Taxes 237,841$ -$ -$ 237,841$
Tax Liens 378,611 - - 378,611
Motor vehicle & other excise taxes 84,680 - - 84,680
Departmental and other - 14,572 118,459 133,031
Intergovernmental 4,357,568 - 937,857 5,295,425
Special assessments - - 777,529 777,529
Total 5,058,700$ 14,572$ 1,833,845$ 6,907,117$
Deferred Revenue Analysis
- 36 -
TOWN OF BREWSTER, MASSACHUSETTS
NOTES TO BASIC FINANCIAL STATEMENTS
JUNE 30, 2007
NOTE 5 – CAPITAL ASSETS
Capital asset activity for the fiscal year ended June 30, 2007, was as follows:
Beginning Ending
Governmental Activities:Balance Increases Decreases Balance
Capital assets not being depreciated:
Land 30,162,512$ 2,125,000$ -$ 32,287,512$
Construction in progress 177,118 10,349 (177,118) 10,349
Total capital assets not being depreciated 30,339,630 2,135,349 (177,118) 32,297,861
Capital assets being depreciated:
Building and improvements 23,780,354 372,770 - 24,153,124
Capital improvement (other than buildings)706,832 19,106 - 725,938
Machinery, equipment, and vehicles 7,169,212 942,639 (1,997,365) 6,114,486
Infrastructure 4,435,760 20,000 - 4,455,760
Total capital assets being depreciated 36,092,158 1,354,515 (1,997,365) 35,449,308
Less accumulated depreciation for:
Building and improvements (6,258,694) (599,589) - (6,858,283)
Capital improvement (other than buildings)(127,123) (35,864) - (162,987)
Machinery, equipment, and vehicles (4,833,576) (414,583) 2,174,483 (3,073,676)
Infrastructure (2,578,445) (220,179) - (2,798,624)
Total accumulated depreciation (13,797,838) (1,270,215) 2,174,483 (12,893,570)
Total capital assets being depreciated, net 22,294,320 84,300 177,118 22,555,738
Total governmental activities capital assets, net 52,633,950$ 2,219,649$-$ 54,853,599$
- 37 -
TOWN OF BREWSTER, MASSACHUSETTS
NOTES TO BASIC FINANCIAL STATEMENTS
JUNE 30, 2007
Beginning Ending
Business-Type Activities:Balance Increases Decreases Balance
Capital assets not being depreciated:
Land 2,874,212$ -$ -$ 2,874,212$
Construction in progress 769,134 32,240 (170,247) 631,127
Total capital assets not being depreciated 3,643,346 32,240 (170,247) 3,505,339
Capital assets being depreciated:
Buildings and improvements 2,588,908 4,764 - 2,593,672
Machinery, equipment, and vehicles 1,926,175 230,357 (369,167) 1,787,365
Infrastructure 19,061,259 12,733 170,247 19,244,239
Total capital assets being depreciated 23,576,342 247,854 (198,920) 23,625,276
Less accumulated depreciation for:
Buildings and improvements (479,121) (64,429) - (543,550)
Machinery, equipment, and vehicles (1,303,451) (190,474) 369,167 (1,124,758)
Infrastructure (5,481,862) (513,516) - (5,995,378)
Total accumulated depreciation (7,264,434) (768,419) 369,167 (7,663,686)
Total capital assets being depreciated, net 16,311,908 (520,565) 170,247 15,961,590
Total business-type activites capital assets, net 19,955,254$ (488,325)$ -$ 19,466,929$
Depreciation expense was charged to functions/programs of the primary government as follows:
General government 38,983$
Public safety 473,087
Education 369,201
Public works 316,584
Human services 11,543
Culture and recreation 60,817
Total depreciation expense - governmental activities 1,270,215$
Water 335,966$
Golf 432,453
Total depreciation expense - business-type activities 768,419$
Governmental Activities:
Business-Type Activities:
- 38 -
TOWN OF BREWSTER, MASSACHUSETTS
NOTES TO BASIC FINANCIAL STATEMENTS
JUNE 30, 2007
NOTE 6 – INTERFUND TRANSFERS
Interfund transfers for the fiscal year ended June 30, 2007, are summarized as follows:
Nonmajor
General Stabilization Governmental
Operating Transfers Out:Fund Fund Funds Total
Nonmajor Governmental Funds 1,043,392$ -$ -$ 1,043,392$ (1)
Nonmajor Governmental Funds 7,316 - - 7,316 (3)
Water Enterprise Fund 209,959 - - 209,959 (1)
Golf Enterprise Fund 601,317 - - 601,317 (3)
Community Preservation Fund 98,174 - - 98,174 (1)
General Fund - 1,000,000 40,000 1,040,000 (2)
General Fund - - 2,064 2,064 (3)
Total 1,960,158$ 1,000,000$ 42,064$ 3,002,222$
Operating Transfers In:
(1) Represents budgeted transfers from the various funds to the general fund.
(2) Represents budgeted transfers from the general fund.
(3) Represents other transfers.
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 for short-term borrowings are accounted for in the general fund.
- 39 -
TOWN OF BREWSTER, MASSACHUSETTS
NOTES TO BASIC FINANCIAL STATEMENTS
JUNE 30, 2007
- 40 -
he following is a summary of changes in short-term debt for the year ended June 30, 2007:
es of general
ng-term debt which are exempt from the debt limit but are subject to other limitations.
he following is a summary of the changes in long-term debt for the year ended June 30, 2007:
onds and Notes Payable Schedule -Governmental Funds
Type Purpose
Rate
(%)
Due
Date
Balance at
June 30, 2006
Renewed/
Issued
Retired/
Redeemed
Balance at
June 30, 2007
BAN Land Acquisition 4.00 1/16/2007 2,125,000$ -$ (2,125,000)$ -$
BAN Land Acquisition 3.80 7/25/2007 - 875,000 - 875,000
Total Governmental Funds 2,125,000$ 875,000$ (2,125,000)$ 875,000$
T
NOTE 8 – LONG-TERM DEBT
al
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 approv
of the Commonwealth’s Emergency Finance Board. Additionally, there are many categori
lo
T
B
Project
Interest
Rate (%)
Outstanding at
June 30, 2006 Issued
Redeemed/
Refunded
Outstanding at
June 30, 2007
School 5.15 4,225,000$ -$ 4,225,000$ -$
School 3.74 - 3,870,000 - 3,870,000
Library 5.15 500,000 - 500,000 -
Library 3.74 - 460,000 - 460,000
MWPAT Title V Septic Var 155,802 - 10,401 145,401
Road Betterments 4.20 46,500 - 15,500 31,000
Road Betterments 4.80 60,000 - 15,000 45,000
Police Station 5.51 2,380,000 - 1,700,000 680,000
Police Station 3.89 - 1,540,000 - 1,540,000
Road Betterments 3.80 55,000 - 15,000 40,000
Road Betterments 3.59 195,000 - 30,000 165,000
Road Betterments 3.62 160,000 - 20,000 140,000
Road Betterments 3.62 225,000 - 30,000 195,000
MWPAT Title V Septic 3.59 175,729 - 9,525 166,204
Land Acquisition 3.64 945,000 - 65,000 880,000
Road Betterments 3.64 307,000 - 37,000 270,000
Road Betterments 3.64 170,000 - 20,000 150,000
Land Acquisition 4.49 - 875,000 - 875,000
Land Acquisition 4.49 - 1,625,000 - 1,625,000
Road Betterments 4.49 - 180,000 - 180,000
Road Betterments 4.49 - 125,000 - 125,000
Total 9,600,031$ 8,675,000$ 6,692,426$ 11,582,605$
TOWN OF BREWSTER, MASSACHUSETTS
NOTES TO BASIC FINANCIAL STATEMENTS
JUNE 30, 2007
- 41 -
cipal and interest for Governmental bonds and notes
utstanding at June 30, 2007 are as follows:
Bonds and Notes Payable Schedule -Water and Golf Enterprise Funds
onds
nd notes outstanding at June 30, 2007 are as follows:
The annual debt service requirements for prin
o
Fiscal Year Principal Interest Total
2008 1,105,429$ 481,735$ 1,587,164$
2009 1,105,426 437,205 1,542,631
2010 1,079,925 391,498 1,471,423
2011 1,049,925 347,466 1,397,391
2012 1,024,925 303,840 1,328,765
2013-2017 4,190,575 901,782 5,092,357
2018-2022 1,471,400 280,532 1,751,932
2023-2027 555,000 67,400 622,400
Total 11,582,605$ 3,211,458$ 14,794,063$
Project
Interest
Rate (%)
Outstanding at
June 30, 2006 Issued
Redeemed/
Refunded
Outstanding at
June 30, 2007
Golf Course 4.75 7,885,000$ -$ 6,085,000$ 1,800,000$
Golf Course 3.92 - 5,690,000 - 5,690,000
Golf Course 3.64 800,000 - 100,000 700,000
Water Mains 5.51 2,120,000 - 1,505,000 615,000
Water Mains 3.89 - 1,360,000 - 1,360,000
Telemetry 5.51 75,000 - 20,000 55,000
Water Betterments - Sears Rd 3.80 5,000 - 5,000 -
Water Betterments - Williams Dr 3.80 25,000 - 5,000 20,000
Standpipe #2 3.80 425,000 - 75,000 350,000
Standpipe Rehabilitation 3.62 575,000 - 75,000 500,000
Water Betterments - Slough Rd 3.64 750,000 - 40,000 710,000
Water Betterments - Slough Rd 4.49 - 96,000 - 96,000
Total 12,660,000$ 7,146,000$ 7,910,000$ 11,896,000$
The annual debt service requirements for principal and interest for water and golf enterprise funds b
a
Fiscal Year Principal Interest Total
2008 906,000$ 523,629$ 1,429,629$
2009 920,000 497,990 1,417,990
2010 930,000 458,080 1,388,080
2011 935,000 416,670 1,351,670
2012 935,000 375,025 1,310,025
2013-2017 4,285,000 1,249,869 5,534,869
2018-2022 2,845,000 272,684 3,117,684
2023-2026 140,000 11,830 151,830
Total 11,896,000$ 3,805,777$ 15,701,777$
TOWN OF BREWSTER, MASSACHUSETTS
NOTES TO BASIC FINANCIAL STATEMENTS
JUNE 30, 2007
- 42 -
es
portion of the 1998 and 2000 series bonds is
onsidered defeased, and the Town has removed the liability from its accounts. The outstanding principal
l debt service payments over the next 15 years by nearly $571,971.
his results in an economic gain (difference between the present values of the debt service payments on
e old and new debt) of $598,967.
, cities and towns issued bonds for eligible school building
rojects and were reimbursed over a period of years by the Commonwealth according to a statutory
mong
reimbursement
ercentages for bonds previously issued under Chapter 645, and the grants for certain “grandfathered”
iated with
rojects, subject to annual appropriation by the state legislature. The Town received
466,477 from scheduled annual payments in FY 2007 from the MSBA for completed school
onstruction projects.
Advanced Refunding – Debt Defeasance
On March 15, 2007, the Town issued $12,920,000 in general obligation refunding bonds with interest
rates ranging between 3.74% and 3.92%. The Town issued the bonds to advance refund $12,820,000 of
the general obligation bonds issued November 15, 1995, June 15, 1998 and March 1, 2000. The Town
used the net proceeds along with other resources to purchase U.S. government securities. These securiti
were deposited in an irrevocable trust to provide for all future debt service on the 1995 series bonds, on
the refunded portion of the 1998 series bonds, and the refunded portion of the 2000 series bonds. As a
result, the 1995 series bonds is considered defeased, that
c
of the defeased bonds is $12,820,000 at June 30, 2007.
The advance refunding reduced tota
T
th
Massachusetts School Building Authority Reimbursements
Chapter 645 of the Act of 1948 as amended (“Chapter 645”) created a statewide school building
assistance program. Pursuant to this program
p
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. A
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
p
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 Massachusetts
School Building Authority (MSBA) to cover eligible project costs, including debt service assoc
the financing of these p
$
c
TOWN OF BREWSTER, MASSACHUSETTS
NOTES TO BASIC FINANCIAL STATEMENTS
JUNE 30, 2007
Loans Authorized and Unissued
- 43 -
s of June 30, 2007, the Town has loans authorized and unissued as follows:
he governmental activities long-term liabilities are generally liquidated by the general fund.
long-term liabilities 12,660,000$ 7,146,000$ (7,910,000)$ 11,896,000$ 906,000$
A
Date
Description Authorized Amount
Septage Betterments 5/6/1996 28,600$
Changes in Long-term Liabilities
The following is a summary of changes in long-term liabilities for the year ended June 30, 2007:
Beginning Ending Current
Governmental Activities: Balance Additions Reductions Balance Portion
Bonds and notes payable 9,600,031$ 8,675,000$ (6,692,426)$ 11,582,605$ 1,105,429$
Landfill postclosure care costs 1,237,500 - (457,500) 780,000 57,000
Total governmental activities
long-term liabilities 10,837,531$ 8,675,000$ (7,149,926)$ 12,362,605$ 1,162,429$
Beginning Ending Current
Business-Type Activities: Balance Additions Reductions Balance Portion
Bonds and notes payable 12,660,000$ 7,146,000$ (7,910,000)$ 11,896,000$ 906,000$
Total business-type activities
T
TOWN OF BREWSTER, MASSACHUSETTS
NOTES TO BASIC FINANCIAL STATEMENTS
JUNE 30, 2007
- 44 -
mmonly referred to as overlapping debt). The following
ummary sets forth the long-term debt of such governmental agencies and the estimated share being
financed b
he Town is exposed to various risks of loss related to torts; theft of, damage to or destruction of assets;
uildings are fully insured against fire, theft, and natural disaster to the extent that losses exceed $1,000
s
f $100,000 per claim in all matters except in actions relating to
deral civil rights, eminent domain and breach of contract. Such claims are charged to the general fund.
tts
l
are
for
BS,
inistered by HPHC. Both PPO plans are self-funded. Also, the Group has
dopted a contributory dental insurance plan (self-funded) and a voluntary (employee-pay-all/fully
sured premium) dental plan.
7,945,000$ 3,861,216$
Overlapping Debt
The Town pays assessments under formulas which include debt service payments to other governmental
agencies providing services to the Town, (co
s
y the Town as of June 30, 2007:
Total Long- Town's Town's
Term Debt Estimated Indirect
Agency Outstanding Share Debt
Barnstable County 110,000$ 4.39% 4,829$
Nauset Regional School District 7,835,000 49.22% 3,856,387
NOTE 9 – RISK FINANCING
T
errors and omissions; injuries to employees; employee’s health and life; and natural disasters.
B
per incident. The fully insurable value of Town buildings is $39,914,177.
The Town is insured for general liability; however, Chapter 258 of the Massachusetts General Laws limit
the Town’s liability to a maximum o
fe
There were no such claims in 2007.
The Town is a member of the Cape Cod Municipal Health Group, (CCMHG) which is a Massachuse
Municipal Health Insurance Joint purchase group. The Group includes thirteen Towns, five schoo
districts, five fire districts, six water districts, one recreation authority, one education collaborative,
Veterans Services of Cape Cod, Barnstable County and Cape Cod Regional Transit Authority 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 (HPHC)
and a self funded medi-wrap plan, Harvard Pilgrim Health Care Enhance Medicare. All of these plans
self-funded. The Group adopted three Medicare Choice plans: Medicare HMO Blue, Managed Blue
Seniors and Tufts Medicare Preferred (fully insured). The Group has adopted Blue Cross/Blue Shield
(BC/BS) Network Blue, a self-funded, Exclusive Provider Organization (EPO) plan as well as two
Preferred Provider Organization (PPO) plans. Blue Care Elect Preferred PPO is administered by BC
and Harvard Pilgrim PPO is adm
a
in
TOWN OF BREWSTER, MASSACHUSETTS
NOTES TO BASIC FINANCIAL STATEMENTS
JUNE 30, 2007
- 45 -
red by Blue Cross Blue Shield of
assachusetts for a monthly administration fee based on the number of individual, single parent/single
e plan are on a claims-paid basis, and are administered by Harvard Pilgrim health care for a
onthly administration fee based on a number of individual and family plan subscribers for that particular
y a
dministered by Delta
ental Plan of Massachusetts for a monthly administration fee based on the number of subscribers. The
the
$50,000 specific
eductible. The Group does not reinsure it Medex and HPHC Medicare Enhance plans. The policy period
this
Group may deal with certified surpluses and deficits by making
irect distributions to members in the case of a certified surplus or may require direct payments from
mployees and 68
tirees who participate in the Group’s health care programs. The Town contributes 75% of the premium
7, the Cape Cod Municipal Health Group had total assets of $31,716,792, total
abilities of $12,193,670 (including $11,898,106 in estimated benefits obligations), and a total surplus of
19,523,122.
The traditional medical indemnity plans, Blue Care Elect Preferred PPO plan, Network Blue EPO plan,
and Medex plan are on a claims-paid basis, and are administe
M
child, and family plan subscribers for that particular month.
The Harvard Pilgrim EPO Plan, Harvard Pilgrim PPO plan, and Harvard Pilgrim Health Care Enhance
Medicar
m
month.
The contributory dental insurance plan is on a claims-paid basis for subscribers whose employers pa
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 a
D
voluntary dental plan is fully insured by Delta Dental Plan of Massachusetts.
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, 2007 and 2006 respectively, for
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
d
covers claims incurred within twelve months and paid within twenty-four months.
The Group’s Board may deal with certified surpluses and deficits through the rate setting process and
is the preferred method. Alternatively, the
d
members in the case of a certified deficit.
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 188 Town of Brewster e
re
cost for employees and 50% of the premium cost for retirees and surviving spouses.
As of June 30, 200
li
$
TOWN OF BREWSTER, MASSACHUSETTS
NOTES TO BASIC FINANCIAL STATEMENTS
JUNE 30, 2007
- 46 -
PLAN
t
stem” except for public school
achers and certain school administrators who are members of the Massachusetts Teachers’ Retirement
andatory upon commencement of employment for all permanent, full-time
mployees. The “System” and the MTRS provide retirement, disability and death benefits to plan
cial report, which can be obtained through the Commonwealth of Massachusetts,
ublic Employee Retirement Administration Commission (“PERAC”), One Ashburton Place, Boston,
NOTE 10 – PENSION
A. Plan Descriptions
The Town contributes to the Barnstable County Contributory Retirement System (the “System”), a cos
sharing, multiple-employer, defined benefit pension plan administered by the Barnstable County
Retirement Board. Substantially all employees are members of the “Sy
te
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 m
e
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 finan
P
Massachusetts 02108.
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 sy
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 c
stem-
ontributions to the
System” for years ended June 30, 2007, 2006, and 2005 were $952,138, $910,000, and $852,570
contributions for each of these years.
“
respectively, which were equal to its required
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 co
behalf” payments to the MTRS totaling $592,057 for fis
ntributed “on-
cal year 2007. In accordance with GASB
tatement No. 24, these on-behalf” payments have been recorded in the general fund as
tergovernmental revenues and pension expenditures.
S
in
TOWN OF BREWSTER, MASSACHUSETTS
NOTES TO BASIC FINANCIAL STATEMENTS
JUNE 30, 2007
- 47 -
pliance audits. Accordingly, the amount of expenditures which may be disallowed by
e granting agencies cannot be determined at this time, although it is believed the amount, if any, would
ot be material.
).
and
ure liability at June 30, 2007 is based on what it would cost to
erform all post-closure care at June 30, 2007. Actual costs may be higher due to inflation, changes in
ys predictable. Although the amount of liability, if any, at June
0, 2007, cannot be ascertained, management believes any resulting liability should not materially affect
e financial position at June 30, 2007.
NOTE 11 – COMMITMENTS AND CONTINGENCIES
The Town participates in a number of federal award programs. However the Town is not subject to the
provisions of the Single Audit Act Amendments of 1996, since the Town did not expend more than
$500,000 of federal awards during the period ended June 30, 2007.These programs may still be subject to
financial and com
th
n
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 (24 years remaining),
the estimated liability has been recorded in the Statement of Net Assets, Governmental Activities. The
$780,000 reported as landfill post-clos
p
technology or changes in regulations.
Various legal actions and claims are pending. Litigation is subject to many uncertainties, and the outcome
of individual litigated matters is not alwa
3
th
TOWN OF BREWSTER, MASSACHUSETTS
NOTES TO BASIC FINANCIAL STATEMENTS
JUNE 30, 2007
- 48 -
he governmental activities net assets balance has been restated to reflect the recognition of land
cquisition not previously recorded.
NOTE 12 – PRIOR PERIOD ADJUSTMENT
T
a
Total
Governemental
Activities
Description Net Assets
Balance at June 30, 2006 as previously reported 57,856,332$
To record the value of the prior year land acquisitions 2,125,000
Balance at June 30, 2006 as restated 59,981,332$
NOTE 13 – PRIOR PERIOD RECLASSIFICATION
The following governmental fund has been restated to reflect the reclassification of the Stabilization Fund
as a major fund from the Nonmajor Governmental Funds at June 30, 2006.
Nonmajor
Stabilization Governmental
Description Fund Funds
Govermental fund balances at June 30, 2006,
as previously reported -$ 4,948,142$
To reclass the major Stabilization fund from the
Nonmajor Governmental funds 1,902,871 (1,902,871)
Govermental fund balances at June 30, 2006 as restated 1,902,871$ 3,045,271$
TOWN OF BREWSTER, MASSACHUSETTS
NOTES TO BASIC FINANCIAL STATEMENTS
JUNE 30, 2007
- 49 -
NOTE 14 – IMPLEMENTATION OF NEW GASB PRONOUNCMENTS
During fiscal year 2007, the following GASB pronouncements were implemented:
The GASB issued Statement #47, Accounting for Termination Benefits, which is required to be
mplemented in Fiscal 2007. The Town has a very limiteid termination benefits program that is budgeted
c financial statements. for and is not material to the basi
Future GASB Pronouncements:
The GASB issued Statement #43, Financial Reporting for Postemployment Benefit Plans Other Than
Pension Plans, which is required to be implemented in Fiscal 2008. Since there is no legally established
eparate trusst for the postemployment benefit plan this pronouncement will not impact the basic financial
statements.
The GASB issued Statement #45, Accounting and Financial Reporting by Employers for
Postemployment Benefits Other Than Pensions, which is required to be implemented in Fiscal 2009.
anagement M believes this pronouncement will require additional disclosure and impact the basic financial
statements.
The GASB issued Statement #48, Sales and Pledges of Receivables and Future Revenues and Intra-
Entity Transfers of Assets and Future Revenues which is required to be implemented in FY2008. Since
e Town does not sell or plthedge receivable or future revenues, this pronouncement will not impact the
basic financial statements.
The GASB issued Statement #49, Accounting and Financial Reporting for Pollution Remediation
Obligations which is required to be implemented in FY2009. Management does not believe that there are
ny pollution remediation obligations thata will require disclosure and this pronouncement will not have an
impact on the basic financial statements.
The GASB issued Statement #50, Pension Disclosures – an amendment of GASB Statements No. 2
o. 27. which is required to be implemented in FY2008. Since the Town does no
5 and
t operate its’ own N
pension plan, this pronouncement will not impact the basic financial statements.
The GASB issued Statement #51, Accounting and Financial Reporting for Intangible Assets which is
required to be implemented in FY2010. Management believes this pronouncement will require additional
disclosure, but will not have a material impact on the basic financial statements.