HomeMy Public PortalAbout2020 Issued financial statements - Moab CityANNUAL FINANCIAL REPORT
Moab City Corporation
For the Year Ended June 30, 2020
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INDEPENDENT AUDITOR'S REPORT 1
MANAGEMENT DISCUSSION AND ANALYSIS 3
BASIC FINANCIAL STATEMENTS 13
Government-wide Financial Statements:
Statement of Net Position 15
Statement of Activities 16
Fund Financial Statements:
Balance Sheet - Governmental Funds 18
Statement of Revenues, Expenditures, and Changes
in Fund Balances - Governmental Funds 19
Reconciliation of the Balance Sheet of Governmental
Funds to the Statement of Net Position 20
Reconciliation of the Statement of Revenues, Expenditures,
and Changes in Fund Balances of Governmental Funds
to the Statement of Activities 21
Statement of Net Position - Proprietary Funds 22
Statement of Revenues, Expenses and Changes in Fund
Net Position - Proprietary Funds 23
Statement of Cash Flows - Proprietary Funds 24
Notes to Financial Statements 26
REQUIRED SUPPLEMENTARY INFORMATION 47
Notes to Required Supplementary Information 49
Schedule of Revenues, Expenditures, and Changes
in Fund Balances - Budget and Actual - General Fund 50
Schedule of the Proportionate Share of the Net Pension Liability51
Schedule of Contributions 52
COMBINING STATEMENTS
Combining Balance Sheet - Governmental Funds 53
Combining Statement of Revenues, Expenditures, and Changes
in Fund Balances - Governmental Funds 54
OTHER REPORTS
Report on Internal Control over Financial Reporting and on
Compliance and Other Matters Based on an Audit of
Financial Statements Performed in Accordance with
Government Auditing Standards 55
Independent Auditor's Report on Compliance and Report
on Internal Control over Compliance as Required by
the State Compliance Audit Guide 57
Moab City Corporation
TABLE OF CONTENTS
June 30, 2020
1
INDEPENDENT AUDITOR’S REPORT
Honorable Mayor
Members of the City Council
Moab, Utah
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 Moab City, Utah (herein
referred to as the “City”), as of and for the year ended June 30, 2020, and the related notes to the
financial statements, which collectively comprise the City’s basic financial statements as listed in the table
of contents.
Management’s Responsibility for the Financial Statements
Management is responsible for the preparation and fair presentation of these financial statements in
accordance with accounting principles generally accepted in the United States of America; this includes
the design, implementation, and maintenance of internal control relevant to the preparation and fair
presentation of financial statements that are free from material misstatement, whether due to fraud or
error.
Auditor’s Responsibility
Our responsibility is to express opinions on these financial statements based on our audit. We conducted
our audit in accordance with auditing standards generally accepted in the United States of America and
the standards applicable to financial audits contained in Government Auditing Standards, issued by the
Comptroller General of the United States. Those standards require that we plan and perform the audit to
obtain reasonable assurance about whether the financial statements are free from material misstatement.
An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in
the financial statements. The procedures selected depend on the auditor’s judgment, including the
assessment of the risks of material misstatement of the financial statements, whether due to fraud or
error. In making those risk assessments, the auditor considers internal control relevant to the entity’s
preparation and fair presentation of the financial statements in order to design audit procedures that are
appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of
the entity’s internal control. Accordingly, we express no such opinion. An audit also includes evaluating
the appropriateness of accounting policies used and the reasonableness of significant accounting
estimates made by management, as well as evaluating the overall presentation of the financial
statements.
We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for
our audit opinions.
Opinions
In our opinion, the financial statements referred to above present fairly, in all material respects, the
respective financial position of the governmental activities, the business-type activities, each major fund,
and the aggregate remaining fund information of Moab City, as of June 30, 2020, and the respective
changes in financial position and, where applicable, cash flows thereof for the year then ended in
accordance with accounting principles generally accepted in the United States of America.
2
Other Matters
Required Supplementary Information
Accounting principles generally accepted in the United States of America require that the management’s
discussion and analysis and other required supplementary information as listed in the table of contents,
be presented to supplement the basic financial statements. Such information, although not a part of the
basic financial statements, is required by the Governmental Accounting Standards Board, who considers
it to be an essential part of financial reporting for placing the basic financial statements in an appropriate
operational, economic, or historical context. We have applied certain limited procedures to the required
supplementary information in accordance with auditing standards generally accepted in the United States
of America, which consisted of inquiries of management about the methods of preparing the information
and comparing the information for consistency with management’s responses to our inquiries, the basic
financial statements, and other knowledge we obtained during our audit of the basic financial statements.
We do not express an opinion or provide any assurance on the information because the limited
procedures do not provide us with sufficient evidence to express an opinion or provide any assurance.
Other Information
Our audit was conducted for the purpose of forming opinions on the financial statements that collectively
comprise Moab City’s basic financial statements. The combining and individual nonmajor fund financial
statements are presented for purposes of additional analysis and are not a required part of the basic
financial statements.
The combining and individual nonmajor fund financial are the responsibility of management and were
derived from and relate directly to the underlying accounting and other records used to prepare the basic
financial statements. Such information has been subjected to the auditing procedures applied in the audit
of the basic financial statements and certain additional procedures, including comparing and reconciling
such information directly to the underlying accounting and other records used to prepare the basic
financial statements or to the basic financial statements themselves, and other additional procedures in
accordance with auditing standards generally accepted in the United States of America. In our opinion,
the combining and individual nonmajor fund financial statements are fairly stated in all material respects
in relation to the basic financial statements as a whole.
Other Reporting Required by Government Auditing Standards
In accordance with Government Auditing Standards, we have also issued a report dated November 30,
2020 on our consideration of Moab City’s internal control over financial reporting and on our tests of its
compliance with certain provisions of laws, regulations, contracts, and grant agreements and other
matters. The purpose of that report is to describe the scope of our testing of internal control over financial
reporting and compliance and the results of that testing, and not to provide an opinion on the
effectiveness of the City’s internal control over financial reporting or on compliance. That report is an
integral part of an audit performed in accordance with Government Auditing Standards in considering
Moab City’s internal control over financial reporting and compliance.
Larson & Company, PC
Spanish Fork, Utah
November 30, 2020
MANAGEMENT'S DISCUSSION AND ANALYSIS
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*Total unrestricted net position for the City as a whole increased by $1,545,846
*Total net position for governmental activities increased by $774,487
*Total net position for business-type activities increased by $1,602,521
FINANCIAL HIGHLIGHTS
*Total net position for the City as a whole increased by $2,377,009
Moab City Corporation
Management's Discussion and Analysis
June 30, 2020
BASIC FINANCIAL STATEMENTS
This discussion and analysis is intended to serve as an introduction to the basic financial statements of Moab
City Corporation. The basic financial statements comprise three components: (1) government wide financial
statements, (2) fund financial statements, and (3) notes to the financial statements.
Government-wide financial statements. The government-wide financial statements are designed to provide
readers with a broad overview of the City's finances, in a manner similar to a private-sector business.
The statement of net position presents information on all of the City's assets, deferred outflows, liabilities, and
deferred inflows, with the difference between the two reported as net position. Over time, increases or decreases
in net position may serve as a useful indicator of whether the financial position of the City is improving or
deteriorating.
The statement of activities presents information showing how the City's net position changed during the fiscal
year reported. All changes in net position 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 fiscal periods.
Both of the government-wide financial statements distinguish functions of the City that are principally supported
by taxes and intergovernmental revenues (governmental activities) from other functions that are intended to
recover all or a significant portion of their costs through user fees and charges (business-type activities). The
statement of activities is presented on two pages. The first page reports the extent to which each function or
program is self-supporting through fees and intergovernmental aid. The second page identifies the general
revenues of the City available to cover any remaining costs of the functions or programs.
As management of Moab City Corporation (the City), we offer readers of the City's financial statements this
narrative overview and analysis of financial activities of the City for the fiscal year ended June 30, 2020.
5
Moab City Corporation
Management's Discussion and Analysis
June 30, 2020
Fund financial statements. A fund is a grouping of related accounts that is used to maintain control over
resources that have been segregated for specific activities or objectives. The City also uses fund accounting to
ensure and demonstrate compliance with finance-related legal requirements. All of the funds of the City can be
divided into two categories: governmental funds and proprietary funds.
Governmental funds . These funds are used to account for the same functions reported as governmental activities
in the government-wide financial statements. Governmental fund financial 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.
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 government 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 government fund balance sheet
and the government fund statement of the revenues, expenditures, and changes in fund balances provide
reconciliation to facilitate this comparison between governmental funds and governmental activities.
The City maintains two major governmental funds, the general fund and the capital projects fund.
The City adopts an annual appropriated budget for all its funds. A budgetary comparison schedule has been
provided to demonstrate legal compliance with the adopted budget for the general fund.
The basic governmental fund financial statements can be found later in this report; see Table of Contents.
Proprietary funds . The City maintains one type of proprietary fund. Enterprise funds are used to report the same
functions presented as business-type activities in the government-wide financial statements. The City uses three
enterprise funds to account for the operations of the water, sewer, and storm drain utilities.
Proprietary funds provide the same type of information as the government-wide financial statements, only in
more detail. The enterprise funds are considered major funds of the City.
The proprietary fund financial statements can be found later in this report; see Table of Contents.
Notes to the financial statements. The notes provide additional information that is essential to a full
understanding of the data provided in the government-wide and fund financial statements. The notes to the
financial statements are reported later in this report; see Table of Contents.
Other information. In addition to the basic financial statements and accompanying notes, this report also
presents certain required supplementary information concerning the City.
6
FINANCIAL ANALYSIS
Moab City Corporation's Net Position
Total Total
Current Previous Current Previous Current Previous
Year Year Year Year Year Year
Current and other assets 6,086,461$ 5,667,707 5,072,349 7,151,047 11,158,809 13,135,857
Net capital assets 18,796,341 18,625,023 28,864,431 25,976,108 47,660,771 44,601,131
Deferred outflows of resources 940,248 1,798,750 91,854 175,725 1,032,102 1,974,475
Total assets and deferred
outflows 25,823,050$ 26,091,481 34,028,633 33,302,880 59,851,683 59,394,361
Long-term debt outstanding 6,471,000$ 6,835,000 15,833,000 16,578,000 22,304,000 23,413,000
Other liabilities 2,613,615 4,007,497 521,875 723,491 3,135,490 4,730,988
Deferred inflows of resources 841,414 126,451 82,199 12,351 923,613 138,802
Total liabilities and
deferred inflows 9,926,029 10,968,948 16,437,074 17,313,842 26,363,103 28,282,790
Net position:
Net investment in
capital assets 12,325,341 11,790,023 13,808,431 10,163,108 26,133,771 21,953,131
Restricted 1,192,659 2,198,533 1,854,574 4,198,177 3,047,233 6,396,710
Unrestricted 2,379,021 1,133,976 1,928,554 1,627,753 4,307,575 2,761,729
Total net position 15,897,020$ 15,122,533 17,591,559 15,989,038 33,488,580 31,111,571
As noted earlier, net position may serve over time as a useful indicator of financial position. Total assets and
deferred outflows of resources exceeded total liabilities and deferred inflow of resources at the close of the year by
$33,488,580, an increase of $2,377,009 from the previous year. This change is equivalent to the net income for the
year, in private sector terms.
Total unrestricted net position at the end of the year is $4,307,575 which represents an increase of $1,545,846 from
the previous year. Unrestricted net position are those resources available to finance day-to-day operations without
constraints established by debt covenants, enabling legislation, or other legal requirements.
The amount of current and other assets represent the amounts of cash and receivables on hand at the end of each
year. Other liabilities are the amounts of current and other liabilities due, at year end, for goods and services
acquired.
Changes in capital assets are the result of the difference, in the current year, of the cost of acquisition of capital
assets and any depreciation charges on capital assets. Change in long-term debt is the difference in the amount of
debt issued and that which has been paid during the year.
Moab City Corporation
Management's Discussion and Analysis
June 30, 2020
Governmental
Activities
Business-type
Activities
7
Moab City Corporation's Change in Net Position
Total Total
Current Previous Current Previous Current Previous
Year Year Year Year Year Year
Program revenues:
Charges for services 3,905,257$ 2,879,700 3,483,377 3,282,318 7,388,634 6,162,018
Operating grants 885,099 497,444 - - 885,099 497,444
Capital grants 1,540,582 1,565,847 1,267,451 972,194 2,808,033 2,538,041
General revenues:
Sales tax 2,085,964 2,192,932 - - 2,085,964 2,192,932
Other taxes 6,441,920 7,049,679 - - 6,441,920 7,049,679
Other revenues 201,751 370,732 148,851 157,525 350,602 528,257
Total revenues 15,060,574 14,556,334 4,899,679 4,412,037 19,960,253 18,968,371
Expenses:
General government 3,568,509 3,443,522 - - 3,568,509 3,443,522
Public safety 3,601,731 3,542,724 - - 3,601,731 3,542,724
Highways and improvements 3,857,017 3,829,402 - - 3,857,017 3,829,402
Parks and recreation 4,016,841 5,199,692 - - 4,016,841 5,199,692
Interest on long-term debt 96,757 90,018 - - 96,757 90,018
Water - - 950,058 885,276 950,058 885,276
Sewer - - 1,473,223 1,432,425 1,473,223 1,432,425
Storm drain - - 19,108 7,747 19,108 7,747
Total expenses 15,140,855 16,105,358 2,442,389 2,325,448 17,583,244 18,430,806
Transfers in (out)854,770 697,470 (854,770) (697,470) - -
Change in net position 774,488$ (851,554) 1,602,521 1,389,119 2,377,009 537,563
Activities
For the City as a whole, total revenues increased by $991,882 compared to the previous year, while total
expenses decreased by $847,562 The total net change of $2,377,009 is, in private sector terms, the net income
for the year which is $1,839,446 more than the previous year.
Governmental activities revenues of $15,060,574 is an increase of $504,240 from the previous year. Charges for
service increased by $933,252. Governmental activities expenses of $15,140,855 is a decrease of $964,503 from
the previous year. While parks and recreation expenses decreased, all other department expenses increased.
Business-type activities revenue of $4,899,679 is an increase of $487,642 from the previous year. Service
revenues increased by $201,059 while capital grants increased by $295,257. Business-type activities expenses
of $2,442,389 is an increase of $116,941 from the previous year. This is due to an overall increase in operation
expenses.
Moab City Corporation
Management's Discussion and Analysis
June 30, 2020
Governmental Business-type
FINANCIAL ANALYSIS (continued)
Activities
8
Moab City Corporation
Management's Discussion and Analysis
June 30, 2020
Expenditures for the current year, excluding transfers, were originally budgeted in the amount of $12,636,633.
This amount was amended in the final budget to $12,636,633. Actual expenditures amounted to $11,632,971.
Transfers in were oringnally budgeted for $854,770, which was equal to the final budgeted amount and to actual
transfers in. Transfers out were originally budgeted in the amount of $1,502,524 and amended to $1,502,524 in
the final budget. Actual transfers out amounted to $974,589.
GENERAL FUND BUDGETARY HIGHLIGHTS
BALANCES AND TRANSACTIONS OF INDIVIDUAL FUNDS
Some of the more significant changes in fund balances and fund net position and any restrictions on those
amounts is described below:
General Fund
Revenues for the current year, exclusive of transfers and fund balance appropriations, were originally budgeted
in the amount of $12,265,809. This amount was amended in the final budget to $12,265,809. Actual revenues,
excluding transfers, amounted to $11,108,512.
Storm Drain Fund
Water Fund
The fund balance of $1,426,043 reflects a decrease of $644,279 from the previous year. Total revenues
increased by $299,155. Tax revenues decrease by $408,602. All other revenues increased by a total of $707,757.
Transfers in were made during the year amounting to $697,470.
Total expenditures increased by $1,756,727. General government expenditures increased by $548,414; public
safety expenditures increased by $582,836; streets and highways expenditures increased by $104,627; and parks
and recreation expenditures increased by $520,850. Total transfers out amounted to $974,589.
Sewer Fund
The change in net position (net income) was $1,311,187, which included capital contributions of $102,207 and
was after transfers out of $378,837. The amounts of $36,759 and $1,016,413 are restricted for debt service and
construction, respectively. Unrestricted net position amounts to $1,487,728.
The fund balance restricted for Class C roads is $508,299. The unassigned fund balance amounts to $917,744.
The change in net position (net income) was $72,804, which was after transfers out of $391,747. The amount of
$801,403 is restricted for construction. Unrestricted net position amounts to $18,814.
The change in net position (net income) was $218,529. Unrestricted net position amounts to $422,011.
9
Moab City Corporation's Capital Assets (net of depreciation)
Total Total
Current Previous Current Previous Current Previous
Year Year Year Year Year Year
Net Capital Assets:
Land and water rights 2,276,884$ 2,276,884 262,935 262,935 2,539,819 2,539,819
Buildings 8,724,261 9,034,185 - - 8,724,261 9,034,185
Improvements other than
buildings 1,464,055 1,673,677 - - 1,464,055 1,673,677
Automobiles & Trucks 284,769 320,697 16,392 21,372 301,162 342,070
Machinery and equipment 618,470 749,092 597,564 682,935 1,216,033 1,432,028
Office equipment 87,535 59,769 - - 87,535 59,769
Infrastructure 2,449,721 2,035,885 - - 2,449,721 2,035,885
Water system - - 2,576,231 2,606,022 2,576,231 2,606,022
Sewer system - - 2,886,057 3,006,391 2,886,057 3,006,391
Work in progress 2,890,646 2,474,847 22,525,251 19,396,451 25,415,897 21,871,298
Totals 18,796,341$ 18,625,035 28,864,431 25,976,108 47,660,771 44,601,143
The total amount of capital assets, net of depreciation, of $47,660,771 is an increase of $3,059,628 from the
previous year.
Governmental activities capital assets, net of depreciation, of $18,796,341 is an increase of $171,305 from the
previous year.
Business-type activities capital assets, net of depreciation, of $28,864,431 is an increase of $2,888,323 from the
previous year.
Additional information regarding capital assets may be found in the notes to financial statements.
CAPITAL ASSETS AND DEBT ADMINISTRATION
Governmental Business-type
Activities Activities
Moab City Corporation
Management's Discussion and Analysis
June 30, 2020
10
Moab City Corporation's Outstanding Debt - Revenue Bonds
Current Previous
Year Year
Governmental activities:
2003 Sales Tax Revenue 972,000$ 1,057,000
2009 Sales Tax Revenue 3,045,000 3,236,000
2018 CIB Bond 699,000 727,000
2019 Walnut Lease 1,755,000 1,815,000
Total governmental 6,471,000 6,835,000
Business-type activities:
2017 Wastewater Revenue 13,485,000 14,120,000
2018 Water and Sewer Bond 2,348,000 2,478,000
Total business-type 15,833,000 16,598,000
Total outstanding debt 22,304,000$ 23,433,000
Additional information regarding the long-term liabilities may be found in the notes to financial statements.
ECONOMIC FACTORS AND NEXT YEAR'S BUDGETS AND RATES
No significant economic changes that would affect the City are expected for the next year. Budgets have been
set on essentially the same factors as the current year being reported.
REQUESTS FOR INFORMATION
This financial report is designed to provide a general overview of the Moab City Corporation's finances for all
those with an interest in the City's finances. Questions concerning any information provided in this report or
requests for additional financial information should be addressed to: City Recorder, 217 East Center Street,
Moab, UT 84532.
CAPITAL ASSETS AND DEBT ADMINISTRATION (continued)
Moab City Corporation
Management's Discussion and Analysis
June 30, 2020
11
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12
BASIC FINANCIAL STATEMENTS
13
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14
Governmental Business-type
Activities Activities Total
ASSETS AND DEFERRED OUTFLOWS OF RESOURCES:
Assets:
Current assets:
Cash and cash equivalents 3,875,506$ 2,688,705 6,564,211
Accounts receivable, net 955,416 529,070 1,484,486
Other current assets 12,941 - 12,941
Total current assets 4,843,863 3,217,774 8,061,637
Non-current assets:
Restricted cash and cash equivalents 1,242,598 1,854,574 3,097,172
Capital assets:
Not being depreciated 5,167,530 22,788,186 27,955,716
Net of accumulated depreciation 13,628,811 6,076,244 19,705,055
Total non-current assets 20,038,938 30,719,005 50,757,943
Total assets 24,882,801 33,936,779 58,819,581
Deferred outflows of resources - pensions 940,248 91,854 1,032,102
Total assets and deferred outflows of resources 25,823,050$ 34,028,633 59,851,683
LIABILITIES AND DEFERRED INFLOWS OF RESOURCES:
Liabilities:
Current liabilities:
Accounts payable 180,761$ 115,957 296,719
Accrued liabilities 162,280 - 162,280
Customer deposits - 17,375 17,375
Accrued interest payable 79,061 143,531 222,592
Long-term debt outstanding, current portion 369,000 777,000 1,146,000
Total current liabilities 791,103 1,053,863 1,844,966
Non-current liabilities:
Compensated absences 515,263 81,268 596,530
Long-term debt outstanding, non-current portion 6,102,000 15,056,000 21,158,000
Net pension liability 1,676,250 163,744 1,839,994
Total non-current liabilities 8,293,512 15,301,012 23,594,524
Total liabilities 9,084,615 16,354,875 25,439,490
Deferred inflows of resources - pensions 841,414 82,199 923,613
Total liabilities and deferred inflows of resources 9,926,029 16,437,074 26,363,103
NET POSITION:
Net investment in capital assets 12,325,341 13,808,431 26,133,771
Restricted for:
Class C roads 508,299 - 508,299
Debt service 398,490 36,759 435,249
Construction 285,869 1,817,815 2,103,685
Unrestricted 2,379,021 1,928,554 4,307,575
Total net position 15,897,020 17,591,559 33,488,580
Total liabilities, deferred inflows of resources
and net position 25,823,050$ 34,028,633 59,851,683
Moab City Corporation
STATEMENT OF NET POSITION
June 30, 2020
15
The notes to the financial statements are an integral part of this statement.
Net
(Expense)
Charges Operating Capital Revenue
for Grants and Grants and (To Next
Expenses Services Contributions Contributions Page)
FUNCTIONS/PROGRAMS:
Primary government:
Governmental activities:
General government 3,568,509$ 704,617 - - (2,863,891)
Public safety 3,601,731 86,335 232,612 - (3,282,785)
Streets and public improvements 3,857,017 1,383,634 249,891 1,502,083 (721,408)
Parks, recreation and public property 4,016,841 1,730,671 402,596 38,499 (1,845,075)
Interest on long-term debt 96,757 - - - (96,757)
Total governmental activities 15,140,855 3,905,257 885,099 1,540,582 (8,809,916)
Business-type activities:
Water utility 950,058 1,250,966 - 149,849 450,757
Sewer utility 1,473,223 1,910,589 - 1,117,602 1,554,968
Storm drain utility 19,108 321,822 - - 302,715
Total business-type activities 2,442,389 3,483,377 - 1,267,451 2,308,440
Total primary government 17,583,244$ 7,388,634 885,099 2,808,033 (6,501,477)
(continued on next page)
Moab City Corporation
STATEMENT OF ACTIVITIES
For the Year Ended June 30, 2020
16
The notes to the financial statements are an integral part of this statement.
Governmental Business-type
Activities Activities Total
CHANGES IN NET POSITION:
Net (expense) revenue
(from previous page)(8,809,916)$ 2,308,440 (6,501,477)
General revenues:
Sales tax 2,085,964 - 2,085,964
Other taxes 6,441,920 - 6,441,920
Unrestricted investment earnings 123,433 98,851 222,284
Miscellaneous 78,318 50,000 128,318
Total general revenues 8,729,635 148,851 8,878,486
Transfers in (out)854,770 (854,770) -
Change in net position 774,488 1,602,521 2,377,009
Net position - beginning 15,122,533 15,989,038 31,111,571
Net position - ending 15,897,020$ 17,591,559 33,488,580
Moab City Corporation
STATEMENT OF ACTIVITIES (continued)
For the Year Ended June 30, 2020
17
The notes to the financial statements are an integral part of this statement.
Capital Non-Major Total
General Projects Governmental Governmental
Fund Fund Funds Funds
ASSETS
Cash and cash equivalents 48,073$ 1,506,229 1,920,297 3,474,599
Accounts receivable, net of allowances 927,356 1,731 26,329 955,416
Other current assets 12,941 - - 12,941
Restricted cash and cash equivalents 508,299 667,611 66,688 1,242,598
TOTAL ASSETS 1,496,669$ 2,175,570 2,013,314 5,685,553
LIABILITIES
Accounts payable 33,233$ 8,683 13,887 55,802
Accrued liabilities 37,393 124,887 - 162,280
TOTAL LIABILITIES 70,626 133,570 13,887 218,083
FUND BALANCES:
Restricted for:
Class C roads 508,299 - - 508,299
Capital projects - 285,869 - 285,869
Debt service - 319,321 79,169 398,490
Assigned for:
Capital projects - 1,436,810 - 1,436,810
Recreation - - 23,644 23,644
Housing - - 1,893,287 1,893,287
Youth city council - - 3,327 3,327
Unassigned 917,744 - - 917,744
TOTAL FUND BALANCES 1,426,043 2,042,001 1,999,427 5,467,471
TOTAL LIABILITIES AND FUND BALANCES 1,496,669$ 2,175,570 2,013,314 5,685,553
Moab City Corporation
BALANCE SHEET - GOVERNMENTAL FUNDS
June 30, 2020
18
The notes to the financial statements are an integral part of this statement.
Capital Non-Major Total
General Projects Governmental Governmental
Fund Fund Funds Funds
Revenues:
Taxes:
Sales 2,085,964$ - - 2,085,964
Other taxes 6,441,920 - - 6,441,920
License and permits 342,683 - - 342,683
Intergovernmental revenues 580,099 1,537,500 305,000 2,422,599
Charges for services 1,469,828 132,090 1,730,463 3,332,381
Fines and forfeitures 53,370 - - 53,370
Interest 63,114 38,088 22,231 123,433
Miscellaneous revenue 71,533 3,378 3,407 78,318
Total revenues 11,108,512 1,711,055 2,061,102 14,880,668
Expenditures:
General government 3,199,802 109,646 - 3,309,448
Public safety 3,399,446 62,482 - 3,461,928
Streets and public improvements 3,256,223 1,364,833 - 4,621,056
Parks, recreation and public property 1,777,500 298,951 1,540,035 3,616,486
Debt service:
Principal - - 364,000 364,000
Interest - - 100,589 100,589
Total expenditures 11,632,971 1,835,912 2,004,624 15,473,507
Excess (deficiency) of revenues over
(under) expenditures (524,460) (124,857) 56,478 (592,839)
Other financing sources and (uses):
Transfers in 854,770 - 1,002,589 1,857,359
Transfers (out) (974,589) (28,000) - (1,002,589)
Total other financing sources and (uses)(119,819) (28,000) 1,002,589 854,770
Net change in fund balances (644,279) (152,857) 1,059,067 261,931
Fund balances - beginning of year 2,070,322 2,194,858 940,360 5,205,540
Fund balance - end of year 1,426,043$ 2,042,001 1,999,427 5,467,471
Moab City Corporation
STATEMENT OF REVENUES, EXPENDITURES AND
CHANGES IN FUND BALANCES - GOVERNMENTAL FUNDS
For the Year Ended June 30, 2020
19
The notes to the financial statements are an integral part of this statement.
Total Fund Balance for Governmental Funds 5,467,471$
Total net position reported for governmental activities in the statement of net position
is different because:
Capital assets used in governmental funds are not financial resources and
therefore are not reported in the funds:
Capital assets, at cost 32,367,768
Less accumulated depreciation (13,571,428)
Net capital assets 18,796,341
Deferred outflows of resources - pensions, a consumption of net position that
applies to future periods, is not shown in the funds statements.940,248
Long-term liabilities, for funds other than enterprise funds, are recorded
in the government-wide statements but not in the fund statements.
General long-term debt (6,471,000)
Interest accrued but not yet paid on long-term debt (79,061)
Compensated absences (515,263)
Net pension liability (1,676,250)
Deferred inflows of resources - pensions (841,414)
Internal service funds are used by management to charge costs of certain
activities to individual funds. This amount represents the assets and
liabilities of the internal service fund reported as governmental activities.275,948
Total Net Position of Governmental Activities 15,897,020$
Moab City Corporation
RECONCILIATION OF THE BALANCE SHEET OF GOVERNMENTAL FUNDS
TO THE STATEMENT OF NET POSITION
June 30, 2020
20
The notes to the financial statements are an integral part of this statement.
Net Change in Fund Balances - Total Governmental Funds 261,931$
Amounts reported for governmental activities in the statement of
activities are different because:
Governmental funds report capital outlays as expenditures. However, in the
statement of activities, assets with a material cost are capitalized and the
cost is allocated over their estimated useful lives and reported as
depreciation expenses.
Capital outlays 1,173,038
Depreciation expense (1,001,721)
Net 171,317
The statement of activities show pension benefits, pension expenses, and non-employer
contributions related to GASB 68 that are not shown in the fund statements.(201,975)
Repayment of debt principal is an expenditure in the governmental funds, but
the repayment reduces long-term liabilities in the statement of net position.
Long-term debt principal repayments 364,000
Accrued interest for long-term debt is not reported as expenditure for
the current period, while it is recorded in the statement of activities.
Change in accrued interest 3,832
Compensated absences expenses reported in the statement of activities do
not require the use of current financial resources and are not reported as
expenditures in governmental funds.
Change in compensated absence liability (4,522)
The net revenue of certain activities of the internal service fund is reported
with governmental activities.179,905
Change in Net Position of Governmental Activities 774,488$
Moab City Corporation
RECONCILIATION OF THE STATEMENT OF REVENUES, EXPENDITURES,
AND CHANGES IN FUND BALANCES OF GOVERNMENTAL FUNDS
For the Year Ended June 30, 2020
TO THE STATEMENT OF ACTIVITIES
21
The notes to the financial statements are an integral part of this statement.
Governmental
Activities
Total Internal Service
Water Sewer Storm Drain Proprietary Health
Fund Fund Fund Funds Insurance
ASSETS AND DEFERRED OUTFLOWS
OF RESOURCES:
Assets:
Current assets:
Cash and cash equivalents -$ 2,299,003 389,702 2,688,705 400,907
Accounts receivable, net 180,066 316,295 32,708 529,070 -
Total current assets 180,066 2,615,298 422,410 3,217,774 400,907
Non-current assets:
Restricted cash and cash equivalents 801,403 1,053,172 - 1,854,574 -
Capital assets:
Not being depreciated 830,798 20,372,777 1,584,611 22,788,186 -
Net of accumulated depreciation 2,839,686 3,163,099 73,459 6,076,244 -
Total non-current assets 4,471,887 24,589,048 1,658,070 30,719,005 -
Total assets 4,651,953 27,204,346 2,080,480 33,936,779 400,907
Deferred outflows of resources - pensions 45,927 45,927 - 91,854 -
Total assets and deferred outflows of resources 4,697,880$ 27,250,273 2,080,480 34,028,633 400,907
LIABILITIES AND DEFERRED INFLOWS
OF RESOURCES:
Liabilities:
Current liabilities:
Accounts payable 9,282$ 106,277 399 115,957 124,959
Customer security deposits 17,375 - - 17,375 -
Accrued interest payable 4,818 138,713 - 143,531 -
Debt outstanding, current portion 24,334 752,666 - 777,000 -
Total current liabilities 55,809 997,655 399 1,053,863 124,959
Non-current liabilities:
Compensated absences 28,398 52,870 - 81,268 -
Debt outstanding, non-current portion 402,058 14,653,942 - 15,056,000 -
Net pension liability 81,872 81,872 - 163,744 -
Total non-current liabilities 512,328 14,788,684 - 15,301,012 -
Total liabilities 568,137 15,786,339 399 16,354,875 124,959
Deferred inflows of resources - pensions 41,100 41,100 - 82,199 -
Total liabilities and deferred inflows of resources 609,237 15,827,439 399 16,437,074 124,959
NET POSITION:
Net investment in capital assets 3,268,426 8,881,935 1,658,070 13,808,431 -
Restricted for:
Debt service - 36,759 - 36,759 -
Construction 801,403 1,016,413 - 1,817,815 -
Unrestricted 18,814 1,487,728 422,011 1,928,554 275,948
Total net position 4,088,643 11,422,835 2,080,081 17,591,559 275,948
Total liabilities, deferred inflows of resources
and net position 4,697,880$ 27,250,273 2,080,480 34,028,633 400,907
Business-type Activities - Proprietary Funds
Moab City Corporation
STATEMENT OF NET POSITION - PROPRIETARY FUNDS
June 30, 2020
22
The notes to the financial statements are an integral part of this statement.
Governmental
Activities
Total Internal Service
Water Sewer Storm Drain Proprietary Health
Fund Fund Fund Funds Insurance
Operating income:
Charges for sales and service 1,144,860$ 1,904,879 321,822 3,371,562 -
Connection fees 47,198 5,710 - 52,908 -
Premiums - - - - 2,043,390
Other operating income 58,908 - - 58,908 -
Total operating income 1,250,966 1,910,589 321,822 3,483,377 2,043,390
Operating expenses:
Personnel services 525,863 585,062 - 1,110,924 1,863,485
Utilities 58,016 138,446 - 196,462 -
Repair and maintenance 97,467 130,047 - 227,514 -
Professional and technical 42,617 176,636 4,000 223,254 -
Other supplies and expenses 8,384 21,275 4,732 34,391 -
Insurance expense 1,560 - - 1,560 -
Depreciation expense 216,151 201,560 10,376 428,088 -
Total operating expense 950,058 1,253,026 19,108 2,222,192 1,863,485
Net operating income (loss)300,908 657,563 302,715 1,261,185 179,905
Non-operating income (expense):
Impact fees 149,849 1,015,395 - 1,165,244 -
Sale of materials - 50,000 - 50,000 -
Interest income 13,794 85,057 - 98,851 -
Interest expense (220,336) - (220,336) -
Total non-operating income (expense)163,644 930,116 - 1,093,759 -
Income (loss) before transfers
and capital contributions 464,551 1,587,678 302,715 2,354,945 179,905
Capital contributions - 102,207 - 102,207 -
Transfers out (391,747) (378,837) (84,186) (854,770) -
Change in net position 72,804 1,311,048 218,529 1,602,382 179,905
Net position - beginning 4,015,839 10,111,786 1,861,552 15,989,177 96,044
Net position - ending 4,088,643$ 11,422,835 2,080,081 17,591,559 275,948
Moab City Corporation
STATEMENT OF REVENUES, EXPENSES, AND CHANGES
IN NET POSITION - PROPRIETARY FUNDS
For the Year Ended June 30, 2019
Business-type Activities - Proprietary Funds
23
The notes to the financial statements are an integral part of this statement.
Governmental
Activities
Total Internal Service
Water Sewer Storm Drain Proprietary Health
Fund Fund Fund Funds Insurance
Cash flows from operating activities:
Cash received from customers - service 1,164,061$ 1,715,754 316,774 3,196,589 -
Cash received for premiums - - - - 2,043,390
Cash paid to suppliers (226,988) (489,166) (9,108) (725,262) (1,728,215)
Cash paid to employees (531,240) (587,914) - (1,119,155) -
Net cash provided (used) in operating activities 405,833 638,674 307,666 1,352,173 315,175
Cash flows from noncapital financing activities:
Transfers in (out) (391,747) (378,837) (84,186) (854,770) -
Change in customer deposits 9,500 - - 9,500 -
Net cash provided (used) in
noncapital financing activities (382,247) (378,837) (84,186) (845,270) -
Cash flows from capital and related
financing activities:
Cash received from capital contributions - 102,207 - 102,207 -
Cash received from impact fees 149,849 1,015,395 - 1,165,244 -
Cash received from sale of materials 50,000 50,000 -
Cash received from bond proceeds - 20,000 - 20,000 -
Cash payments for capital assets (323,269) (1,918,141) (1,075,000) (3,316,411) -
Cash payments for long-term debt principal (23,608) (741,392) - (765,000) -
Cash payments for long-term debt interest (267) (227,014) - (227,281) -
Net cash provided (used) in capital
and related financing activities (197,294) (1,698,946) (1,075,000) (2,971,240) -
Cash flows from investing activities:
Cash received from interest earned 13,794 85,057 - 98,851 -
Net cash provided (used) in investing activities 13,794 85,057 - 98,851 -
Net increase (decrease) in cash (159,915) (1,354,052) (851,520) (2,365,487) 315,175
Cash balance, beginning 961,317 4,706,227 1,241,222 6,908,766 85,733
Cash balance, ending 801,403$ 3,352,174 389,702 4,543,279 400,907
Cash reported on the statement of net position:
Cash and cash equivalents -$ 2,299,003 389,702 2,688,705 400,907
Non-current restricted cash 801,403 1,053,172 - 1,854,574 -
Total cash and cash equivalents 801,403$ 3,352,174 389,702 4,543,279 400,907
Business-type Activities - Proprietary Funds
Moab City Corporation
STATEMENT OF CASH FLOWS
For the Year Ended June 30, 2020
24
The notes to the financial statements are an integral part of this statement.
Reconciliation of Operating Income to Net Cash Governmental
Provided (Used) in Operating Activities:Activities
Total Internal Service
Water Sewer Storm Drain Proprietary Health
Fund Fund Fund Funds Insurance
Net operating income (expense)300,908$ 657,563 302,715 1,261,185 179,905
Adjustments to reconcile operating income or (loss)
to net cash provided (used)in operating activities:
Depreciation and amortization 216,151 201,560 10,376 428,088 -
Changes in assets and liabilities:
(Increase) decrease in receivables (86,905) (194,835) (5,049) (286,788) -
(Increase) decrease in deferred outflows 41,936 41,936 - 83,871 -
Increase (decrease) in payables (18,945) (22,762) (376) (42,082) 135,270
Increase (decrease) in compensated absences (15,244) (12,719) - (27,962) -
Increase (decrease) in net pension liabilities (66,994) (66,994) - (133,987) -
Increase (decrease) in deferred inflows 34,924 34,924 - 69,848 -
Net cash provided (used) in operating activities 405,833$ 638,674 307,666 1,352,173 315,175
Business-type Activities - Proprietary Funds
Moab City Corporation
STATEMENT OF CASH FLOWS (continued)
For the Year Ended June 30, 2020
25
The notes to the financial statements are an integral part of this statement.
Moab City Corporation
NOTES TO FINANCIAL STATEMENTS
June 30, 2020
NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
1-A. Reporting entity
Moab City Corporation (the City), is a municipal corporation located in Grand County, Utah. The City
operates under Mayor-Council form of government.
The accompanying financial statements present the City and its component units, entities for which the
City is considered to be financially accountable. The financial statements of the City have been prepared
in conformity with Generally Accepted Accounting Principles (GAAP) as applied to government units.
The Governmental Accounting Standards Board is the accepted standard setting body for establishing
governmental accounting and financial reporting principles. The more significant of the government’s
accounting policies are described below.
1-B. Government-wide and fund financial statements
Government-wide Financial Statements
The government-wide financial statements, consisting of the statement of net assets and the statement of
changes in net assets report information on all of the non-fiduciary activities of the primary government
and its component units. For the most part, the effect of inter-fund activity has been removed from these
statements. Governmental activities , which normally are supported by taxes and intergovernmental
revenues, are reported separately from business-type activities , which rely to a significant extent on fees
and charges for support.
The statement of activities reports the expenses of a given function offset by program revenues directly
connected with the functional program. A function is an assembly of similar activities and may include
portions of a fund or summarize more than one fund to capture the expenses and program revenues
associated with a distinct functional activity. Direct expenses are those that are clearly identifiable with a
specific function or segment. Indirect expenses are not allocated. All expenses are included in the
applicable function. Program revenues include (1) charges to customers or applicants who purchase, use,
or directly benefit from goods, services, or privilege provided by a given function or segment and (2)
grants and contributions that are restricted to meeting the operational or capital requirements of a
particular function or segment. Taxes and other items not properly included among program revenues are
reported instead as general revenues .
Fund Financial Statements
Separate financial statements are provided for governmental funds, proprietary funds, and fiduciary funds,
if any, even though the latter are excluded from the government-wide financial statements. Major
individual governmental funds and major individual enterprise funds are reported as separate columns in
the fund financial statement.
26
Moab City Corporation
NOTES TO FINANCIAL STATEMENTS
June 30, 2020
1-C. Measurement focus, basis of accounting and financial statement presentation
The financial statements of the City are prepared in accordance with generally accepted accounting
principles (GAAP).
The government-wide statements are reported using the economic resources measurement focus and the
accrual basis of accounting, generally including the reclassification of internal activity (between or within
funds). However, internal eliminations do not include utility services provided to City departments or
payments to the general fund by other funds for providing administrative and billing services for such
funds. Reimbursements are reported as reductions to expenses. Proprietary and any fiduciary fund
financial statements are also reported using this same focus and basis of accounting although internal
activity is not eliminated in these statements. Revenues are recorded when earned and expenses are
recorded when a liability is incurred, regardless of the timing of related cash flows. Property tax revenues
are recognized in the year for which they are levied while grants are recognized when the grantor
eligibility requirements are met.
Governmental fund financial statements are reported using the current financial resources measurement
focus and the modified accrual basis of accounting. Revenues are recognized as soon as they are both
measurable and available. Revenues are considered to be available when they are collectible within the
current period or soon enough thereafter to pay liabilities of the current period. The City considers
revenues to be available if they are collected within 60 days of the end of the current fiscal period.
Expenditures generally are recorded when a liability is incurred, as under accrual accounting. However,
debt service expenditures, as well as expenditures related to compensated absences and claims and
judgments, are recorded only when payment is due.
Property taxes, sales taxes, intergovernmental revenues, and interest associated with the current fiscal
period are all considered to be susceptible to accrual and so have been recognized as revenues of the
current fiscal period. Only the portion of special assessments, if any, receivable within the current fiscal
period is considered to be susceptible to accrual as revenue of the current period. All other revenue items
are considered to be measurable and available only when cash is received by the government.
Proprietary funds distinguish operating revenues and expenses from non-operating items. Operating
income and expense reported in proprietary fund financial statements include those revenues and expenses
related to the primary, continuing operations of the fund. Principal operating revenues for proprietary
funds are charges to customers for sales or services. Principal operating expenses are the costs of
providing goods or services, including administrative expenses and depreciation of capital assets. Other
revenues and expenses are classified as non-operating in the financial statements.
Policy regarding use of restricted resources
When both restricted and unrestricted resources are available for use, it is the City's policy to use
restricted resources first, then unrestricted resources as needed. Restricted assets and liabilities payable
from restricted assets current in nature are reported with current assets and current liabilities. Restricted
assets, non-current reports assets restricted for acquisition or construction of non-current assets, or are
restricted for liquidation of long-term debt.
27
Moab City Corporation
NOTES TO FINANCIAL STATEMENTS
June 30, 2020
1-D. Fund types and major funds
Governmental funds
The City reports the following major governmental funds:
The general fund is the government's primary operating fund. It accounts for all financial resources of the
general government, except those required to be accounted for in another fund.
The capital projects fund accounts for financial resources used for the acquisition or construction of the
capital facilities of the City (other than those of the enterprise funds).
The City reports the following as non-major governmental funds:
The recreation fund accounts for the revenues and expenditures for the activities in relation to recreation.
The housing fund accounts for the revenues and expenditures for the activities of community housing.
The debt service fund accounts for the payment of governmental long-term debt.
The youth city council fund accounts for activities with the youth city council.
Proprietary funds
The City reports the following major proprietary funds:
The water fund is used to account for the activities of the water utility.
The sewer fund is used to account for the activities of the sewer utlitiy.
The storm drain fund is used to account for the revenues and expenses of the storm drain utility.
The governmental internal service fund is used to account for health insurance activities.
1-E. Assets, Liabilities, and Net Position or Equity
1-E-1. Deposit and Investments
Investments are reported at fair value. Deposits are reported at cost, which approximates fair value.
Investments of the City are accounts at the Utah Public Treasurers Investments Fund. Additional
information is contained in Note 3.
1-E-2. Cash and Cash Equivalents
The City's cash and cash equivalents 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.
1-E-3. Receivables and Payables
Accounts receivable other than intergovernmental receivables are from customers primarily for utility
services. Intergovernmental receivables are considered collectible. Customer accounts are reported net of
an allowance for uncollectible accounts. The allowance amount is estimated using accounts receivable
past due more than 90 days.
28
Moab City Corporation
NOTES TO FINANCIAL STATEMENTS
June 30, 2020
1-E-3. Receivables and Payables (continued)
During the course of operations, there may be transactions occur between funds that are representative of
lending/borrowing arrangements outstanding at year-end. These are reported as either due to or due from
other funds .
1-E-4. Restricted Assets
In accordance with certain revenue bond covenants, resources may be required to be set aside for the
repayment of such bonds, and, on occasion, for the repair and maintenance of the assets acquired with the
bond proceeds. These resources are classified as restricted assets on the balance sheet because of their
limited use. Most capital grant agreements mandate that grant proceeds be spent only on capital assets.
Unspent resources of this nature are also classified as restricted. The limited use resources described
above involve a reported restriction of both cash and net assets.
Unspent proceeds of bonds issued to finance capital assets are also reported as restricted cash.
1-E-5. Inventories and Prepaid items
Inventories, which mainly consist of immaterial amounts of expendable supplies for consumption, are not
reported. Such supplies are acquired as needed. Proprietary fund inventories, where material, are stated at
the lower of cost or market, using the first-in, first-out basis.
Prepaid items record payments to vendors that benefit future reporting and are reported on the
consumption basis. Both inventories and prepayments are similarly reported in government-wide and fund
financial statements.
1-E-6. Capital Assets
Capital assets includes property, plant, equipment, and infrastructure assets (e.g., roads, bridges,
sidewalks, and similar items), and are reported in the applicable governmental or business-type activities
columns in the government-wide financial statements. Capital assets are defined by the government as
assets with an initial, individual cost of $5,000 or more and an estimated useful life in excess of two years.
Such assets are recorded at historical cost or at estimated historical cost if purchased or constructed.
Donated capital assets are recorded at estimated fair market value at the date of donation. Infrastructure is
depreciated.
The cost of normal maintenance and repairs that does not add to the value of an asset or materially extend
the assets' life is not capitalized. Major outlays for capital assets and improvements are capitalized as
projects are constructed. Interest incurred during the construction phase of capital assets of business-type
activities is included as part of the capitalized value of the assets constructed.
29
Assets Years
Buildings and structures 30-45
Infrastructure 30
Vehicles and equipment 5-15
Moab City Corporation
NOTES TO FINANCIAL STATEMENTS
June 30, 2020
1-E-6. Capital Assets (continued)
Upon retirement or disposition of capital assets, the cost and related accumulated depreciation are
removed from the respective accounts. Depreciation of capital assets is computed using the straight-line
method over their estimated useful lives.
Property, plant, and equipment of the primary government, as well as the component units if any, is
depreciated using the straight line method over the following estimated useful lives:
1-E-7. Long-term Obligations
In the government-wide and proprietary fund financial statements, long-term debt and obligations are
reported as liabilities in the applicable governmental activities, business-type activities, or proprietary
fund statement of net assets.
The governmental fund financial statements recognize the proceeds of debt and premiums as other
financing sources of the current period. Issuance costs (if any) are reported as expenditures.
1-E-8. Deferred Outflows/Inflows of Resources
In addition to assets, the statement of net position will sometimes include a separate section for deferred
outflows of resources. This separate financial statement element, deferred outflows of resources,
represents a consumption of net position that applies to a future period(s) and so will not be recognized as
an outflow of resources (expense/expenditure) until then. The City reports deferred outflows of resources
related to pensions as required by GASB 68.
In addition to liabilities, the statement of net position will sometimes include a separate section for
deferred inflows of resources. This separate financial statement element, deferred inflows of resources,
represents an acquisition of net position that applies to a future period(s) and so will not be recognized as
an inflow of resources (revenue) until then. The City also reports deferred inflows of resources related to
pensions as required by GASB 68.
1-E-9. Pensions
For purposes of measuring the net pension liability, deferred outflows of resources and deferred inflows of
resources related to pensions, and pension expense, information about the fiduciary net position of the
Utah Retirement Systems Pension Plan (URS) and additions to/deductions from URS's fiduciary net
position have been determined on the same basis as they are reported by URS. For this purpose, benefit
payments (including refunds of employee contributions) are recognized when due and payable in
accordance with the benefit terms. Investments are reported at fair value.
30
1-E-10. Fund Equity
Proprietary fund equity is classified the same as in the government-wide statements.
Unrestricted net position - All other net position that does not meet the definition of "restricted" or "net
investment in capital assets."
Net investment in capital assets - 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.
Fund Financial Statements
In the fund financial statements governmental fund equity is classified as fund balance. Governmental fund
balance is further classified as Nonspendable, Restricted, Committed, Assigned or Unassigned.
Descriptions of each follow:
Moab City Corporation
NOTES TO FINANCIAL STATEMENTS
June 30, 2020
Government-wide Financial Statements
Equity is classified in the government-wide financial statements as net position and is displayed in three
components:
Restricted net position - Net position 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.
Unassigned fund balance - Residual classification of the General Fund. This classification represents
fund balance that has not been assigned to other funds and that has not been restricted, committed, or
assigned to specific purposes within the General Fund.
Nonspendable fund balance - Amounts that cannot be spent because they are either (a) not in
spendable form, or (b) legally or contractually required to be maintained intact.
Assigned fund balance - Amounts that the City intends to be used for a specific purpose but are neither
restricted nor committed. The City Recorder is authorized to assign amounts to a specific purpose in
accordance with the City's budget policy.
Committed fund balance - Amounts that can only be used for specific purposes established by formal
action of the City Council, with is the City's highest level of decision making authority. Fund balance
commitments can only be removed or changed by the same type of action (for example resolution) of the
City Council. This classification also includes contractual obligations to the extent that existing
resources have been specifically committed for use in satisfying those contractual requirements.
Restricted fund balance - Net fund resources that are subject to external constraints that have been
placed on the use of the resources either a) imposed by creditors (such as through a debt covenant),
grantors, contributors, or laws or regulations of the government or b) imposed by law through
constitutional provisions or enabling legislation.
31
Moab City Corporation
NOTES TO FINANCIAL STATEMENTS
June 30, 2020
1-F. Estimates
The preparation of financial statements in conformity with GAAP requires management to make estimates
and assumptions that affect the amounts reported in the financial statements and the accompanying notes.
Actual results may differ from those estimates.
NOTE 2 - STEWARDSHIP, COMPLIANCE AND ACCOUNTABILITY
2-A. Budgetary data
Annual budgets are prepared and adopted by ordinance by total for each department, in accordance with
State law, by the Mayor and City Council on or before June 22 for the following fiscal year beginning
July 1. Estimated revenues and appropriations may be increased or decreased by resolution of the City
Council at any time during the year. A public hearing must be held prior to any proposed increase in a
fund's appropriations. Budgets include activities in the General Fund. The level of the City's budgetary
control (the level at which the City's expenditures cannot legally exceed appropriations) is established at
the department level. Each department head is responsible for operating within the budget for their
department. All annual budgets lapse at fiscal year end.
Utah State law prohibits the appropriation of unreserved General Fund balance to an amount less than 5%
of the General Fund revenues. The 5% reserve that cannot be budgeted is used to provide working capital
until tax revenue is received, to meet emergency expenditures, and to cover unanticipated deficits. Any
unreserved General Fund balance greater than 25% of the current year's actual revenues. The general fund
balance was under the legal allowable limit for the year ended June 30, 2020.
Once adopted, the budget may be amended by the City Council without hearing provided the budgeted
expenditures do not exceed budgeted revenues and appropriated fund balance. A public hearing must be
held if the budgeted expenditures will exceed budgeted revenues and any fund balance which is available
for budgeting. With the consent of the Mayor, department heads may reallocate unexpended appropriated
balances from one expenditure account to another within that department during the budget year. Budgets
for the General Fund are prepared on the modified accrual basis of accounting. Encumbrances are not
used.
2-B. Deficit fund balance or net position
None of the City's funds have deficit fund balances or net position.
32
Fair Value
Cash on hand 901$
Demand deposits - checking 552,255
Deposits - PTIF 9,108,227
Total cash $ 9,661,383
Cash and cash equivalents (current)6,564,211$
Restricted cash and cash equivalents (non-current)3,097,172
Total cash and cash equivalents 9,661,383$
Cash equivalents and investments are carried at fair value in accordance with GASB Statement No. 72.
The Utah Money Management Act (UMMA) establishes specific requirements regarding deposits of public
funds by public treasurers. UMMA requires that city funds be deposited with a qualified depository which
includes any depository institution which has been certified by the Utah State Commissioner of Financial
Institutions as having met the requirements specified in UMMA Section 51, Chapter 7. UMMA provides
the formula for determining the amount of public funds which a qualified depository may hold in order to
minimize risk of loss and also defines capital requirements which an Institution must maintain to be eligible
to accept public funds. UMMA lists the criteria for investments and specifies the assets which are eligible
to be invested in, and for some investments, the amount of time to maturity.
UMMA enables the State Treasurer to operate the Public Treasurer's Investment Pool (PTIF). PTIF is
managed by the Utah State Treasurer's investment staff and comes under the regulatory authority of the
Utah Money Management Council. This council is comprised of a select group of financial professionals
from units of local and state government and financial institutions doing business in the state. PTIF
operations and portfolio composition is monitored at least semi-annually by the Utah Money Management
Council. PTIF is unrated by any nationally recognized statistical rating organizations. Deposits in PTIF are
not insured or otherwise guaranteed by the State of Utah. Participants share proportionally in any realized
gains or losses on investments which are recorded on an amortized cost basis. The balance available for
withdrawal is based on the accounting records maintained by PTIF. The fair value of the investment pool is
approximately equal to the value of the pool shares. The City maintains monies not immediately needed for
expenditure in PTIF accounts.
Deposit and Investment Risk
The City maintains no investment policy containing any specific provisions intended to limit the City's
exposure to interest rate risk, credit risk, and concentration of credit risk other than that imposed by
UMMA. The City's compliance with the provisions of UMMA addresses each of these risks.
Cash and investments listed above are classified in the accompanying government-wide statement of net
position as follows:
Moab City Corporation
NOTES TO FINANCIAL STATEMENTS
June 30, 2020
NOTE 3 - DETAILED NOTES
3-A. Deposits and investments
Cash and investments as of June 30, 2020 consist of the following:
33
Other Water and
General Governmental Sewer Storm Drain
Fund Funds Funds Fund Total
Customers 162,849$ - 510,796 32,708 706,353
Intergovernmental receivables 752,642 - - - 752,642
Other receivables 11,865 28,060 - - 39,925
Total receivables 927,356 28,060 510,796 32,708 1,498,920
Allowance for uncollectibles - - (14,434) - (14,434)
Total receivables, net of allowances 927,356$ 28,060 496,361 32,708 1,484,486
Moab City Corporation
NOTES TO FINANCIAL STATEMENTS
June 30, 2020
3-A. Deposits and investments (continued)
Fair Value of Investments
The City measures and records its investments using fair value measurement guidelines established by
generally accepted accounting principles. These guidelines recognize a three-tiered fair value hierarchy, as
follows: Level 1--Quoted prices for identical investments in active markets; Level 2-- Observable inputs
other than quoted market prices; and, Level 3--Unobservable inputs. At June 30, 2020 the City had
$9,108,227 invested in the PTIF, which uses a Level 2 fair value measurement.
Interest rate risk
Interest rate risk is the risk that changes in market interest rates will adversely affect the fair value of an
investment. All deposits and investments of the City are available immediately.
Credit risk
Generally, credit risk is the risk that an issuer of an investment will not fulfill its obligations. Custodial
credit risk for deposits is the risk that, in the event of the failure of a depository financial institution, a
government will not be able to recover its deposits. At June 30, 2020, the City's bank balance of demand
and bank trust deposits total $452,288 and the book balance is $552,255. Of these deposits, $250,000 is
covered by FDIC insurance; $202,288 is uninsured and uncollateralized.
Custodial credit risk for investments is the risk that, in the event of the failure of the counterparty (e.g.,
broker-dealer) to a transaction, a government will not be able to recover the value of its investment or
collateral securities that are in the possession of another party. This risk is addressed through the policy of
investing excess monies only in PTIF.
Concentration of credit risk
Concentration of credit risk is the risk of loss attributed to the magnitude of a government's investment in a
single issuer. PTIF falls under the constraints of UMMA in limiting concentrations of investments.
3-B. Receivables
The allowance policy is described in Note 1-E-3. Receivables as of year end for the City's funds are shown
below:
34
Beginning Ending
Governmental activities Balance Additions Retirements Balance
Capital assets, not being depreciated:
Land and rights 2,276,884$ - - 2,276,884
Construction in progress 2,474,847 415,799 - 2,890,646
Total capital assets, not being depreciated 4,751,731 415,799 - 5,167,530
Capital assets, being depreciated:
Buildings 12,339,644 - - 12,339,644
Improvements other than buildings 4,527,322 17,869 - 4,545,191
Autos and trucks 2,418,452 45,092 - 2,463,544
Machinery and equipment 2,599,973 52,767 - 2,652,740
Office equipment 606,397 45,340 - 651,737
Infrastructure 3,951,223 596,160 - 4,547,383
Total capital assets, being depreciated 26,443,012 757,227 - 27,200,239
Less accumulated depreciation for:
Buildings 3,305,459 309,924 - 3,615,383
Improvements other than buildings 2,853,646 227,490 - 3,081,136
Autos and trucks 2,097,754 81,020 - 2,178,774
Machinery and equipment 1,850,880 183,390 - 2,034,270
Office equipment 546,629 17,573 - 564,202
Infrastructure 1,915,339 182,323 - 2,097,662
Total accumulated depreciation 12,569,707 1,001,721 - 13,571,428
Total capital assets being depreciated, net 13,873,305 (244,494) - 13,628,811
Governmental activities capital assets, net 18,625,035$ 171,305 - 18,796,341
Governmental activities:
General government 252,037$
Public safety 91,351
Highways and public improvements 253,111
Parks, recreation and public property 405,222
Total 1,001,721$
Moab City Corporation
NOTES TO FINANCIAL STATEMENTS
June 30, 2020
3-C. Capital Assets
Capital asset activity for the governmental activities was as follows:
Depreciation expense was charged to functions/programs of the primary government governmental
activities was follows:
35
Beginning Ending
Business-type activities Balance Additions Retirements Balance
Capital assets, not being depreciated:
Land and water shares 262,935$ - - 262,935
Construction in progress 19,396,451 3,128,800 - 22,525,251
Total capital assets, not being depreciated 19,659,387 3,128,800 - 22,788,186
Capital assets, being depreciated:
Water system 6,533,062 140,391 - 6,673,453
Sewer system 7,400,481 11,488 - 7,411,969
Machinery and equipment 1,746,113 35,732 - 1,781,845
Autos and trucks 260,032 - - 260,032
Total capital assets, being depreciated 15,939,688 187,611 - 16,127,299
Less accumulated depreciation for:
Water system 3,927,040 170,182 - 4,097,222
Sewer system 4,394,090 131,822 - 4,525,912
Machinery and equipment 1,063,177 121,104 - 1,184,281
Autos and trucks 238,659 4,980 - 243,639
Total accumulated depreciation 9,622,967 428,088 - 10,051,055
Total capital assets being depreciated, net 6,316,721 (240,477) - 6,076,244
Business-type activities capital assets, net 25,976,108$ 2,888,323 - 28,864,431
Business-type activities:
Water 216,151$
Wastewater 201,560
Storm water 10,376
Total 428,088$
Moab City Corporation
NOTES TO FINANCIAL STATEMENTS
June 30, 2020
3-C. Capital Assets (continued)
Capital asset activity for the business-type activities was as follows:
Depreciation expense was charged to functions/programs of the primary government business-type
activities was follows:
36
Due
Original % Beginning Ending Within
Principal Rate Balance Additions Reductions Balance One Year
Bonds:
2003 Sales Tax Revenue
Matures 2030 2,050,000$ 2.50 1,057,000$ - 85,000 972,000 87,000
2009 Sales Tax Revenue
Matures 2036 4,764,000 0.00 3,236,000 - 191,000 3,045,000 191,000
2018 CIB Bond
Matures 2039 727,000 2.50 727,000 - 28,000 699,000 29,000
Direct Borrowings:
2019 Walnut Lease
Matures 2039 1,815,000 4.26 1,815,000 - 60,000 1,755,000 62,000
Total governmental activity
long-term liabilities 6,835,000$ - 364,000 6,471,000 369,000
Principal Interest Total
2021 369,000 113,371 482,371
2022 375,000 102,826 477,826
2023 381,000 116,084 497,084
2024 388,000 96,146 484,146
2025 394,000 89,986 483,986
2026-2030 2,062,000 349,432 2,411,432
2031-2035 1,660,000 195,862 1,855,862
2036-2039 842,000 54,109 896,109
Total 6,471,000$ 1,117,817 7,588,817
Long-term debt activity for the business-type activities was as follows:
Due
Original % Beginning Ending Within
Principal Rate Balance Additions Reductions Balance One Year
Bonds:
2017 Wastewater Revenue
Matures 2039 14,200,000$ 1.15 14,120,000$ - 635,000 13,485,000 643,000
2018 Water and Sewer Bond
Matures 2034 2,478,000 3.39 2,478,000 - 130,000 2,348,000 134,000
Total business-type activity
long-term liabilities 16,598,000$ - 765,000 15,833,000 777,000
Moab City Corporation
NOTES TO FINANCIAL STATEMENTS
June 30, 2020
3-D. Long-term debt
Long-term debt activity for the governmental activities was as follows:
Bond debt service requirements to maturity for governmental activities are as follows:
37
3-D. Long-term debt (continued)
Principal Interest Total
2021 777,000 233,324 1,010,324
2022 788,000 221,319 1,009,319
2023 800,000 209,081 1,009,081
2024 813,000 196,593 1,009,593
2025 826,000 183,843 1,009,843
2026-2030 4,326,000 718,702 5,044,702
2031-2035 4,476,000 361,300 4,837,300
2036-2039 3,027,000 89,828 3,116,828
Total 15,833,000$ 2,213,988 18,046,988
Other long-term liabilities:
Increase
Compensated absences:Beginning (Decrease) Ending
Governmental 510,740$ 4,523 515,263
Business-type 109,230 (27,962) 81,268
Total 619,970$ (23,440) 596,530
Net pension liability:
Governmental 3,047,739$ (1,371,489) 1,676,250
Business-type 297,731 (133,987) 163,744
Total 3,345,470$ (1,505,476) 1,839,994
3-E. Interfund transfers
Transfers In Transfers Out
General fund 854,770$ 974,589
Capital projects fund - 28,000
Recreation fund 700,000 -
Debt service fund 302,589 -
Water fund - 391,747
Sewer fund - 378,837
Storm drain fund - 84,186
Total 1,857,359$ 1,857,359
Transfers are used to move unrestricted general fund revenues to finance various programs that the
government must account for in other funds in accordance with budgetary authorizations, including
amounts provided as subsidies or matching funds for various grant programs.
Bond debt service requirements to maturity for business-type activities are as follows:
Moab City Corporation
NOTES TO FINANCIAL STATEMENTS
June 30, 2020
The City has outstanding bonds and other direct borrowings related to governmental activities totaling
$6,471,000, and related to business-type activities totaling $15,833,000. The outstanding bonds and other
direct borrowings are all secured with their respective revenues and/or property and equipment as
collateral.
38
NOTE 4 - OTHER INFORMATION
4-A. Risk management
4-B. Landfill agreement
4-C. Rounding Convention
4-D. Subsequent Events
Moab City entered into an agreement with the Grand County Solid Waste Management Special Service
District No. 1 and Grand County in which the City agreed to guarantee the performance of closure and
post-closure care at the Klondike and Moab Landfills. Should the escrow moneys set aside by the District
not cover all costs associated with the closure and post-closure of the landfill, Moab would be liable for
one half of the uncovered costs. Total closure and post-closure costs are currently estimated to be no more
than $175,400 for the Klondike Landfill and for the Moab Landfill.
A rounding convention to the nearest whole dollar has been applied throughout this report, therefore the
precision displayed in any monetary amount is plus or minus $1. These financial statements are computer
generated and the rounding convention is applied to each amount displayed in a column, whether detail
item or total. As a result, without the overhead cost of manually balancing each column, the sum of
displayed amounts in a column may not equal the total displayed. The maximum difference between any
displayed number or total and its actual value will not be more than $1.
In preparing these financial statements, the City has evaluated events and transactions for potential
recognition or disclosure through the date of the audit report, which is the date the financial statements
were available to be used.
Moab City Corporation
NOTES TO FINANCIAL STATEMENTS
June 30, 2020
The City is exposed to various risks of loss related to torts; theft of, damage to, and destruction of assets;
errors and omissions; and natural disasters. The City participates in the Utah Local Government Trust, a
public agency insurance mutual, which provides coverage for property damage and general liability. The
City is subject to a minimal deductible for claims. There have been no significant reductions in insurance
coverage from coverage in the prior year. Amounts of settlements have not exceeded insurance coverage
in any of the past three fiscal years.
The City provides health insurance through an agreement with CIGNA, using a self-funded plan with an
individual stop loss limit of $25,000 per employee. All claims are processed and paid by CIGNA. The
City is required to submit monthly payments to CIGNA, from which all claims are paid. At the end of
each monthly period during the policy year, the City is either reimbursed for excess contributions over
claims, or billed for deficient contributions in regards to claims. Therefore, under the current policy there
are no provisions for runout beyond each monthly reporting period, and as such the City has not accrued
additional liability in the financial statements as presented.
39
4-E. Pension Plans
General Information about the Pension Plan
Plan description:
Moab City Corporation
NOTES TO FINANCIAL STATEMENTS
June 30, 2020
The Utah Retirement Systems (Systems) are established and governed by the respective sections of Title
49 of the Utah Code Annotated 1953, as amended. The Systems’ defined benefit plans are amended
statutorily by the State Legislature. The Utah State Retirement Office Act in Title 49 provides for the
administration of the Systems under the direction of the Board, whose members are appointed by the
Governor. The Systems are fiduciary funds defined as pension (and other employee benefit) trust funds.
URS is a component unit of the State of Utah. Title 49 of the Utah Code grants the authority to establish
and amend the benefit terms.
URS issues a publicly available financial report that can be obtained by writing Utah Retirement Systems,
560 E. 200 S., Salt Lake City, Utah 84102 or visiting the website: www.urs.org.
Eligible plan participants are provided with pensions through the Utah Retirement Systems. The Utah
Retirement Systems are comprised of the following Pension Trust funds:
Public Employees Noncontributory Retirement System (Noncontributory System) is a multiple
employer, cost sharing, public employee retirement system;
The Public Safety Retirement System (Public Safety System) is a mixed agent and cost-sharing,
multiple-employer public retirement system;
Tier 2 Public Employees Contributory Retirement System (Tier 2 Public Employees System) is a
multiple employer cost sharing public employer retirement system;
Tier 2 Public Safety and Firefighter Contributory Retirement System (Tier 2 Public Safety and
Firefighters System) is a multiple employer, cost sharing, public employee retirement system.
The Tier 2 Public Employees System became effective July 1, 2011. All eligible employees beginning on
or after July 1, 2011, who have no previous service credit with any of the Utah Retirement Systems, are
members of the Tier 2 Retirement System.
40
4-E. Pension Plans (continued)
Years of service required
Final Average and/or age eligible for Benefit percentage
System Salary benefit per year of service Cola **
Noncontributory System Highest 3 Years 30 years any age
25 years any age*
20 years age 60*
10 years age 62*
4 years age 65
2.0% per year all years Up to 4%
Public Safety System Highest 3 Years 20 years an age
10 years age 60
4 years age 65
2.5% per year up to 20
years; 2.0% per year over
20 years
Up to 2.5 % to
4% depending
on employer
Tier 2 Public
Employees System
Highest 5 Years 35 years any age
20 years any age 60*
10 years age 62*
4 years age 65
1.5% per year all years Up to 2.5%
Tier 2 Public Safety
and Firefighter System
Highest 5 Years 35 years any age
20 years any age 60*
10 years age 62*
4 years age 65
1.5% per year all years Up to 2.5%
* with actuarial reductions
Moab City Corporation
NOTES TO FINANCIAL STATEMENTS
June 30, 2020
** All past-retirement cost-of-living adjustments are non-compounding and are based on the original benefit except
for Judges, which is a compounding benefit. The cost-of-living adjustments are also limited to the actual Consumer
Price Index (CPI) increase for the year, although unused CPI increases not met may be carried forward to subsequent
years.
Contributions:
As a condition of participation in the Systems, employers and/or employees are required to contribute
certain percentages of salary and wages as authorized by statute and specified by the URS Board.
Contributions are actuarially determined as an amount that, when combined with employee contributions
(where applicable) is expected to finance the costs of benefits earned by employees during the year, with
an additional amount to finance any unfunded actuarial accrued liability.
Benefits provided:
URS provides retirement, disability, and death benefits. Retirement benefits are as follows:
41
4-E. Pension Plans (continued)
Employer Employer
Employee Contribution Rate for
Utah Retirement Systems Paid Rate 401(k) Plan
Contributory System
111 - Local Government Div - Tier 2 N/A 15.66 1.03
Noncontributory System
15 - Local Government Div - Tier 1 N/A 18.47 N/A
Public Safety System
Contributory
122 - Tier 2 DB Hybrid Public Safety N/A 23.13 0.70
Noncontributory
43 - Other Div A with 2.5% COLA N/A 34.04 N/A
Tier 2 DC Only
211 - Local Government N/A 6.69 10.00
222 - Public Safety N/A 11.83 12.00
Employer Employee
System Contributions Contributions
Noncontributory System 430,148$ N/A
Public Safety System 112,463 -
Tier 2 Public Employees System 266,241 -
Tier 2 Public Safety and Firefighter 125,234 -
Tier 2 DC Only System 43,805 N/A
Tier 2 DC Public Safety and Firefighter 4,544 N/A
Total Contributions $ 982,435 -
For the fiscal year ended June 30, 2020, the employer and employee contributions to the Systems were as
follows:
Contributions reported are the URS Board approved required contributions by System. Contributions in the
Tier 2 Systems are used to finance the unfunded liabilities in the Tier 1 Systems.
Pension Assets, Liabilities, Expense, and Deferred Outflows of Resources and Deferred Inflows of
Resources Related to Pensions
At June 30, 2020, we reported a net pension asset of $0 and a net pension liability of $1,839,993.
Moab City Corporation
NOTES TO FINANCIAL STATEMENTS
June 30, 2020
Contribution rates are as of June 30, 2020 are as follows:
Tier 2 rates include a statutory required contribution to finance the unfunded actuarial accrued liability of
the Tier 1 plans.
42
4-E. Pension Plans (continued)
Proportionate
Net Pension Net Pension Proportionate Share Change
Asset Liability Share 12/31/2018 (Decrease)
Noncontributory System -$ 1,185,178$ 0.3144653% 0.3020442% 0.0124211%
Public Safety System - 604,610 0.3765594% 0.4153505% -0.0387911%
Tier 2 Public Employees System - 22,723 0.1010323% 0.1098332% -0.0088009%
Tier 2 Public Safety and Firefighter - 27,482 0.2921612% 0.2289598% 0.0632014%
Total -$ 1,839,993$
For the year ended June 30, 2020, we recognize pension expense of $1,198,996.
Deferred Deferred
Outflows Inflows
of Resources of Resources
Difference between expected and actual experience 132,894$ 37,741$
Changes in assumptions 162,384 901
- 830,032
240,066 54,940
Contributions subsequent to the measurement date 496,757 -
Total 1,032,101$ 923,614$
Net Deferred
Outflows (Inflows)
Year Ended December 31,of Resources
2020 30,203$
2021 (160,724)
2022 27,624
2023 (312,653)
2024 3,305
Thereafter 23,975
$496,757 reported as deferred outflows of resources related to pensions results from contributions made by
us prior to our fiscal year end, but subsequent to the measurement date of December 31, 2019. These
contributions will be recognized as a reduction of the net pension liability in the upcoming fiscal year.
Other amounts reported as deferred outflows of resources and deferred inflows of resources related to
pensions will be recognized in pension expense as follows:
Net difference between projected and actual earnings on pension
plan investments
Changes in proportion and differences between contributions
and proportionate share of contributions
Moab City Corporation
NOTES TO FINANCIAL STATEMENTS
June 30, 2020
(Measurement Date): December 31, 2019
The net pension asset and liability was measured as of December 31, 2019, and the total pension liability
used to calculate the net pension asset and liability was determined by an actuarial valuation as of January
1, 2019 and rolled-forward using generally accepted actuarial procedures. The proportion of the net pension
asset and liability is equal to the ratio of the employer's actual contributions to the Systems during the plan
year over the total of all employer contributions to the System during the plan year.
At June 30, 2020, we reported deferred outflows of resources and deferred inflows of resources relating to
pensions from the following sources:
43
4-E. Pension Plans (continued)
Inflation 2.50 Percent
Salary increases 3.25 - 9.75 percent, average, including inflation
Investment rate of return 6.95 percent, net of pension plan investment
expense, including inflation
Real Return Long Term expected
Target Asset Arithmetic portfolio real
Assets class Allocation Basis rate of return
Equity securities 40% 6.15% 2.46%
Debt securities 20% 0.40% 0.08%
Real assets 15% 5.75% 0.86%
Private equity 9% 9.95% 0.89%
Absolute return 16% 2.85% 0.46%
Cash and cash equivalents 0% 0.00% 0.00%
Totals 100.00% 4.75%
Inflation 2.50%
Expected arithmetic nominal return 7.25%
The 6.95% assumed investment rate of return is comprised of an inflation rate of 2.50%, a real return of
4.45% that is net of investment expense.
Actuarial assumptions:
The total pension liability in the December 31, 2019, actuarial valuation was determined using the
following actuarial assumptions, applied to all periods included in the measurement:
Mortality rates were developed from actual experience and mortality tables, based on gender, occupation
and age, as appropriate, with adjustments for future improvement in mortality based on Scale AA, a model
developed by the Society of Actuaries.
The actuarial assumptions used in the January 1, 2019, valuation were based on the results of an actuarial
experience study for the five year period ending December, 31, 2016.
The long-term expected rate of return on pension plan investments was determined using a building-block
method in which best- estimate ranges of expected future real rates of return (expected returns, net of
pension plan investment expense and inflation) are developed for each major asset class. These ranges are
combined to produce the long-term expected rate of return by weighting the expected future real rates of
return by the target asset allocation percentage and by adding expected inflation.
The target allocation and best estimates of arithmetic real rates of return for each major asset class are
summarized in the following table:
Expected Return Arithmetic Basis
Moab City Corporation
NOTES TO FINANCIAL STATEMENTS
June 30, 2020
44
4-E. Pension Plans (continued)
1% Decrease Discount Rate 1% Increase
System (5.95%) (6.95%) (7.95%)
Noncontributory System $ 3,701,725 $ 1,185,178 $ (913,595)
Public Safety System 1,566,176 604,610 (176,847)
Tier 2 Public Employees System 195,950 22,723 (111,150)
Tier 2 Public Safety and Firefighter 97,083 27,482 (24,186)
Total 5,560,934$ 1,839,993$ (1,225,778)$
- 401(k) Plan
- 457(b) Plan
- Roth IRA Plan
- Traditional IRA Plan
Defined Contribution Savings Plan:
The Defined Contribution Savings Plans are administered by the Utah Retirement Systems Board and are
generally supplemental plans to the basic retirement benefits of the Retirement Systems, but may also be
used as a primary retirement plan. These plans are voluntary tax-advantaged retirement savings programs
authorized under sections 401(k), 457(b) and 408 of the Internal Revenue code. Detailed information
regarding plan provisions is available in the separately issued URS financial report.
The City participates in the following Defined Contribution Savings Plans with the Utah Retirement
Systems:
Discount rate:
The discount rate used to measure the total pension liability was 6.95 percent. The projection of cash flows
used to determine the discount rate assumed that employee contributions will be made at the current
contribution rate and that contributions from all participating employers will be made at contractually
required rates that are actuarially determined and certified by the URS Board. Based on those assumptions,
the pension plan's fiduciary net position was projected to be available to make all projected future benefit
payments of current active and inactive employees. Therefore, the long-term expected rate of return on
pension plan investments was applied to all periods of projected benefit payments to determine the total
pension liability. The discount rate does not use the Municupal Bond Index Rate. The discount rate
remained unchaged at 6.95 percent.
Sensitivity of the proportionate share of the net pension asset and liability to changes in the discount
rate:
The following presents the proportionate share of the net pension liability calculated using the discount
rate of 6.95 percent, as well as what the proportionate share of the net pension liability would be if it were
calculated using a discount rate that is 1-percentage-point lower (5.95 percent) or 1-percentage-point
higher (7.95 percent) than the current rate:
Pension plan fiduciary net position:
Detailed information about the pension plan's fiduciary net position is available in the separately issued
URS financial report.
Moab City Corporation
NOTES TO FINANCIAL STATEMENTS
June 30, 2020
45
4-E. Pension Plans (continued)
2020 2019 2018
401(k) Plan
Employer Contributions 91,390$ 80,042$ 58,700$
Employee Contributions 73,403 76,425 62,027
457 Plan
Employer Contributions - - -
Employee Contributions 46,523 42,178 26,153
Roth IRA Plan
Employer Contributions N/A N/A N/A
Employee Contributions 11,555 9,800 4,980
Traditional IRA Plan
Employer Contributions N/A N/A N/A
Employee Contributions 6,400 3,500 650
Employee and employer contributions to the Utah Retirement Contribution Savings Plans for fiscal year
ended June 30, were as follows:
Moab City Corporation
NOTES TO FINANCIAL STATEMENTS
June 30, 2020
46
REQUIRED SUPPLEMENTARY INFORMATION
(Unaudited)
47
This page intentionally left blank.
48
Moab City Corporation
Notes to Required Supplementary Information
June 30, 2020
Budgetary Comparison Schedules
The Budgetary Comparison Schedule presented in this section of the report is for the City's General Fund.
Budgeting and Budgetary Control
The budget for the General Fund is legally required and is prepared and adopted on the modified accrual
basis of accounting.
Original budgets represent the revenue estimates and spending authority authorized by the City Council
prior to the beginning of the year. Final budgets represent the original budget amounts plus any
amendments made to the budget during the year by the Council through formal resolution. Final budgets
do not include unexpended balances from the prior year because such balances automatically lapse to
unreserved fund balance at the end of each year.
Current Year Excess of Expenditures over Appropriations
For the year ended June 30, 2020, expenditures within all departments were under the appropriated
budget.
Changes in Assumptions Related to Pensions
As a result of the passage of SB 129, the retirement rates for members in the Tier 2 Public Safety and
Firefighter Hybrid System have been modified to be the same as the assumption used to model the
retirement pattern in the Tier 1 Public Safety and Firefighter Systems, except for a 10% load at first
eligibility for unreduced retirement prior to age 65.
49
Budgeted Budgeted Variance with
Original Final Actual Final Budget
Revenues:
Taxes:
Sales 2,285,880$ 2,285,880$ 2,085,964$ (199,916)$
Other taxes 7,470,017 7,470,017 6,441,920 (1,028,097)
License and permits 431,000 431,000 342,683 (88,317)
Intergovernmental revenues 459,512 459,512 580,099 120,587
Charges for services 1,313,100 1,313,100 1,469,828 156,728
Fines and forfeitures 55,000 55,000 53,370 (1,630)
Interest 115,000 115,000 63,114 (51,886)
Miscellaneous revenue 136,300 136,300 71,533 (64,767)
Total revenues 12,265,809 12,265,809 11,108,512 (1,157,297)
Expenditures:
General government 3,354,334 3,199,834 3,199,802 32
Public safety 3,773,031 3,772,031 3,399,446 372,585
Streets and public improvements 3,480,383 3,480,383 3,256,223 224,160
Parks, recreation and public property 2,028,885 2,184,385 1,777,500 406,885
Total expenditures 12,636,633 12,636,633 11,632,971 1,003,662
Excess (deficiency) of revenues over
(under) expenditures (370,824) (370,824) (524,460) (153,636)
Other financing sources and (uses):
Transfers in 854,770 854,770 854,770 -
Transfers (out) (1,502,524) (1,502,524) (974,589) 527,935
Total other financing sources and (uses)(647,754) (647,754) (119,819) 527,935
Net change in fund balances (1,018,578) (1,018,578) (644,279) 374,299
Fund balances - beginning of year 2,070,322 2,070,322 2,070,322 -
Fund balance - end of year 1,051,744$ 1,051,744$ 1,426,043$ 374,299$
For the Year Ended June 30, 2020
Moab City Corporation
SCHEDULE OF REVENUES, EXPENDITURES, AND
CHANGES IN FUND BALANCES - BUDGET AND ACTUAL - GENERAL FUND
50
2019 2018 2017 2016 2015 2014
Noncontributory Retirement System
Proportion of the net pension liability (asset) 0.3144653% 0.3020442% 0.2720231% 0.2051978% 0.2179161% 0.2429667%
1,185,178$ 2,224,170$ 1,191,815$ 1,317,621$ 1,233,075$ 1,055,019$
Covered employee payroll 2,374,861$ 328,933$ 2,116,310$ 1,658,246$ 1,878,267$ 2,145,537$
49.91% 95.50% 56.32% 79.46% 65.65% 49.20%
93.70% 87.00% 91.90% 87.30% 87.80% 90.20%
Public Safety System
Proportion of the net pension liability (asset) 0.3765594% 0.4153505% 0.3546422% 0.3205798% 0.3147178% 0.3437599%
604,610$ 1,068,524$ 556,312$ 650,545$ 563,739$ 432,307$
Covered employee payroll 459,476$ 545,965$ 464,620$ 485,395$ 518,613$ 567,252$
131.59% 195.71% 119.73% 134.02% 108.70% 76.20%
90.90% 84.70% 90.20% 86.50% 87.10% 90.50%
Tier 2 Public Employees Retirement System
Proportion of the net pension liability (asset) 0.1010323% 0.1098332% 0.1060867% 0.0734958% 0.0396361% 0.0260780%
22,723$ 47,039$ 9,353$ 8,198$ (87)$ (790)$
Covered employee payroll 1,403,213$ 1,285,740$ 1,036,381$ 602,722$ 256,204$ 128,012$
1.62% 3.66% 0.90% 1.36% -0.03% -0.06%
96.50% 90.80% 97.40% 95.10% 100.20% 103.50%
Tier 2 Public Safety and Firefighters Retirement
Proportion of the net pension liability (asset) 2.9216120% 0.2895980% 0.2448621% 0.2801501% 0.2137309% 0.1428958%
27,482$ 5,737$ (2,833)$ (2,432)$ (3,123)$ (2,114)$
Covered employee payroll 481,552$ 306,330$ 258,591$ 231,468$ 127,224$ 59,035$
5.71% 1.87% -1.10% -1.05% -2.45% -3.60%
89.60% 95.60% 103.00% 103.60% 110.70% 120.50%
Proportionate share of the net pension
liability (asset)
Proportionate share of the net pension
liability (asset)
Last 10 Fiscal Years*
* In accordance with paragraph 81.a of GASB 68, employers will need to disclose a 10-year history of their proportionate share of
the Net Pension Liability (Asset) in their RSI. The 10-year schedule will need to be built prospectively. The schedule above is only
for the last six years.
Moab City Corporation
SCHEDULE OF THE PROPORTIONATE SHARE OF THE NET PENSION LIABILITY
June 30, 2020
Proportionate share of the net pension
liability (asset) as a percentage of its
covered-employee payroll
Proportionate share of the net pension
liability (asset) as a percentage of its
covered-employee payroll
Proportionate share of the net pension
liability (asset) as a percentage of its
covered-employee payroll
Proportionate share of the net pension
liability (asset) as a percentage of its
covered-employee payroll
Plan fiduciary net position as a percentage
of the total pension liability
Plan fiduciary net position as a percentage
of the total pension liability
Plan fiduciary net position as a percentage
of the total pension liability
Plan fiduciary net position as a percentage
of the total pension liability
Proportionate share of the net pension
liability (asset)
Proportionate share of the net pension
liability (asset)
51
As of
fiscal
year
ended
June 30,
Actuarial
Determined
Contributions
Contributions in
relation to the
contractually
required
contribution
Contribution
deficiency
(excess)
Covered
employee
payroll
Contributions
as a percentage
of covered
employee
payroll
2014 373,502$ 373,502$ -$ 2,218,242$ 16.84%
2015 366,950 366,950 - 2,031,635 18.06%
2016 311,453 311,453 - 1,712,251 18.19%
2017 349,063 349,063 - 1,888,219 18.49%
2018 402,915 402,915 - 2,197,705 18.33%
2019 461,209 461,209 - 2,504,252 18.42%
2020 430,148 430,148 - 2,354,525 18.27%
Public Safety System 2014 171,445 171,445 - 617,222 27.78%
2015 144,696 144,696 - 506,159 28.59%
2016 131,264 131,264 - 481,965 27.24%
2017 150,874 150,874 - 467,586 32.27%
2018 170,152 170,152 - 499,858 34.04%
2019 184,630 184,630 - 544,546 33.91%
2020 112,463 112,463 - 367,840 30.57%
2014 14,676 14,676 - 104,905 13.99%
2015 24,084 24,084 - 161,205 14.94%
2016 71,331 71,331 - 480,471 14.85%
2017 107,879 107,879 - 723,538 14.91%
2018 198,725 198,725 - 1,315,187 15.11%
2019 192,220 192,220 - 1,235,347 15.56%
2020 266,241 266,241 - 1,700,133 15.66%
2014 9,427 9,427 - 45,213 20.85%
2015 17,359 17,359 - 76,979 22.55%
2016 42,971 42,971 - 190,912 22.51%
2017 57,774 57,774 - 256,776 22.50%
2018 59,366 59,366 - 263,029 22.57%
2019 90,664 90,664 - 393,145 23.06%
2020 125,234 125,234 - 541,436 23.13%
2014 - - - - 0.00%
2015 1,378 1,378 - 20,512 6.72%
2016 2,915 2,915 - 43,531 6.70%
2017 5,495 5,495 - 77,713 7.07%
2018 9,367 9,367 - 140,012 6.69%
2019 32,163 32,163 - 480,764 6.69%
2020 43,805 43,805 - 654,783 6.69%
2014 3,336 3,336 - 33,558 9.94%
2015 3,700 3,700 - 31,279 11.83%
2016 950 950 - 8,030 11.83%
2017 - - - - 0.00%
2018 - - - - 0.00%
2019 - - - - 0.00%
2020 4,544 4,544 - 38,414 11.83%
* Paragraph 81.b of GASB 68 requires employers to disclose a 10-year history of contributions in RSI. The 10-year
schedule will need to be built prospectively. The schedule above is only for the past seven years.
** Contributions as a percentage of covered-payroll may be different than the board certified rate due to rounding and
other administrative issues.
Tier 2 Public Safety and
Firefighter DC Only
System**
Moab City Corporation
SCHEDULE OF CONTRIBUTIONS
June 30, 2020
Last 10 Fiscal Years*
Noncontributory Retirement
System
Tier 2 Public Employees
Retirement System**
Tier 2 Public Safety and
Firefighter System**
Tier 2 Public Employees DC
Only System**
52
Youth Total
Debt City Non-Major
Recreation Housing Service Council Governmental
Fund Fund Fund Fund Funds
ASSETS
Cash and cash equivalents 15,502$ 1,901,467 - 3,327 1,920,297
Accounts receivable 13,848 - 12,481 - 26,329
Restricted cash and cash equivalents - - 66,688 - 66,688
TOTAL ASSETS 29,350$ 1,901,467 79,169 3,327 2,013,314
LIABILITIES
Accounts payable 5,706$ 8,180 - - 13,887
TOTAL LIABILITIES 5,706 8,180 - - 13,887
FUND BALANCES:
Restricted for:
Debt service - - 79,169 - 79,169
Assigned for:
Recreation 23,644 - - - 23,644
Housing - 1,893,287 - - 1,893,287
Yout City Council - - - 3,327 3,327
TOTAL FUND BALANCES 23,644 1,893,287 79,169 3,327 1,999,427
TOTAL LIABILITIES AND FUND BALANCES 29,350$ 1,901,467 79,169 3,327 2,013,314
Moab City Corporation
COMBINING BALANCE SHEET
NONMAJOR GOVERNMENTAL FUNDS
June 30, 2020
53
Youth Total
Debt City Non-Major
Recreation Housing Service Council Governmental
Fund Fund Fund Fund Funds
Revenues:
Intergovernmental revenues 115,000$ - 190,000 - 305,000
Charges for services 359,317 1,319,978 51,169 - 1,730,463
Interest 2,954 19,241 - 35 22,231
Miscellaneous revenue 3,407 - - 3,407
Total revenues 480,678 1,339,220 241,169 35 2,061,102
Expenditures:
Parks, recreation and public property 1,416,042 123,993 - - 1,540,035
Debt service:
Principal - - 364,000 - 364,000
Interest - - 100,589 - 100,589
Total expenditures 1,416,042 123,993 464,589 - 2,004,624
Excess (deficiency) of revenues over
(under) expenditures (935,364) 1,215,227 (223,420) 35 56,478
Other financing sources and (uses):
Transfers in 700,000 - 302,589 - 1,002,589
Total other financing sources and (uses)700,000 - 302,589 - 1,002,589
Net change in fund balances (235,364) 1,215,227 79,169 35 1,059,067
Fund balances - beginning of year 259,008 678,060 - 3,292 940,360
Fund balance - end of year 23,644$ 1,893,287 79,169 3,327 1,999,427
Moab City Corporation
COMBINING STATEMENT OF REVENUES, EXPENDITURES AND
NONMAJOR GOVERNMENTAL FUNDS
CHANGES IN FUND BALANCES
For the Year Ended June 30, 2020
54
55
INDEPENDENT AUDITOR’S REPORT ON INTERNAL CONTROL OVER FINANCIAL
REPORTING AND ON COMPLIANCE AND OTHER MATTERS BASED ON AN AUDIT OF
FINANCIAL STATEMENTS PERFORMED IN ACCORDANCE WITH GOVERNMENT AUDITING
STANDARDS
The Honorable Mayor, and
Members of the City Council
Moab City, Utah
We have audited, in accordance with the auditing standards generally accepted in the United States of
America and the standards applicable to financial audits contained in Government Auditing Standards
issued by the Comptroller General of the United States, the financial statements of the governmental
activities, the business-type activities, each major fund, and the aggregate remaining fund information of
Moab City, Utah (herein referred to as the “City”), as of and for the year ended June 30, 2020, and the
related notes to the financial statements, which collectively comprise the City’s basic financial statements
and have issued our report thereon dated November 30, 2020.
Internal Control over Financial Reporting
In planning and performing our audit of the financial statements, we considered the City’s internal control
over financial reporting (internal control) to determine the audit procedures that are appropriate in the
circumstances for the purpose of expressing our opinions on the financial statements, but not for the
purpose of expressing an opinion on the effectiveness of the City’s internal control. Accordingly, we do
not express an opinion on the effectiveness of the City’s internal control.
A deficiency in internal control exists when the design or operation of a control does not allow
management or employees, in the normal course of performing their assigned functions, to prevent, or
detect and correct, misstatements on a timely basis. A material weakness is a deficiency, or a
combination of deficiencies, in internal control such that there is a reasonable possibility that a material
misstatement of the entity’s financial statements will not be prevented or detected and corrected on a
timely basis. A significant deficiency is a deficiency, or a combination of deficiencies, in internal control
that is less severe than a material weakness, yet important enough to merit attention by those charged
with governance.
Our consideration of internal control was for the limited purpose described in the first paragraph of this
section and was not designed to identify all deficiencies in internal control that might be material
weaknesses or significant deficiencies. Given these limitations, during our audit we did not identify any
deficiencies in internal control that we consider to be material weaknesses. However, material
weaknesses may exist that have not been identified.
Compliance and Other Matters
As part of obtaining reasonable assurance about whether the City ’s financial statements are free from
material misstatement, we performed tests of its compliance with certain provisions of laws, regulations,
contracts, and grant agreements, noncompliance with which could have a direct and material effect on
the determination of financial statement amounts. However, providing an opinion on compliance with
those provisions was not an objective of our audit, and accordingly, we do not express such an opinion.
The results of our tests disclosed no instances of noncompliance or other matters that are required to be
reported under Government Auditing Standards.
56
Purpose of this Report
The purpose of this report is solely to describe the scope of our testing of internal control and compliance
and the results of that testing, and not to provide an opinion on the effectiveness of the entity’s internal
control or on compliance. This report is an integral part of an audit performed in accordance with
Government Auditing Standards in considering the entity’s internal control and compliance. Accordingly,
this communication is not suitable for any other purpose.
Larson & Company, PC
Spanish Fork, Utah
November 30, 2020
57
INDEPENDENT AUDITOR’S REPORT ON COMPLIANCE AND ON
INTERNAL CONTROL OVER COMPLIANCE AS REQUIRED BY THE
STATE COMPLIANCE AUDIT GUIDE
The Honorable Mayor, and
Members of the City Council
Moab City, Utah
Report on Compliance with General State Compliance Requirements
We have audited Moab City’s (herein referred to as the “City”) compliance with the applicable general
state compliance requirements described in the State Compliance Audit Guide, issued by the Office of the
Utah State Auditor, that could have a direct and material effect on the City for the year ended June 30,
2020.
General state compliance requirements were tested for the year ended June 30, 2020 in the following
areas:
Budgetary Compliance Open and Public Meetings Act
Fund Balance Fraud Risk Assessment
Utah Retirement Systems
Restricted Taxes and Related Revenues
Management’s Responsibility
Management is responsible for compliance with the general state requirements referred to above.
Auditor’s Responsibility
Our responsibility is to express an opinion on the City’s compliance based on our audit of the compliance
requirements referred to above. We conducted our audit of compliance in accordance with auditing
standards generally accepted in the United States of America; the standards applicable to financial audits
contained in Government Auditing Standards issued by the Comptroller General of the United States; and
the State Compliance Audit Guide. Those standards and the State Compliance Audit Guide require that
we plan and perform the audit to obtain reasonable assurance about whether noncompliance with the
compliance requirements referred to above that could have a direct and material effect on the City
occurred. An audit includes examining, on a test basis, evidence about the City’s compliance with those
requirements and performing such other procedures as we considered necessary in the circumstances.
We believe that our audit provides a reasonable basis for our opinion on compliance with general state
compliance requirements. However, our audit does not provide a legal determination of the City’s
compliance.
Opinion on General State Compliance Requirements
In our opinion, Moab City, complied, in all material respects, with the compliance requirements referred to
above that could have a direct and material effect on the City for the year ended June 30, 2020.
58
Other Matters
The results of our auditing procedures disclosed instances of noncompliance, which are required to be
reported in accordance with the State Compliance Audit Guide and which are described in our letter to
management dated November 30, 2020. Our opinion is on compliance is not modified with respect to
these matters.
The City’s response to the noncompliance findings identified in our audit is described in our letter to
management. The City’s response was not subjected to the auditing procedures applied in the audit of
compliance and, accordingly, we express no opinion on the response.
Report on Internal Control Over Compliance
Management of the City is responsible for establishing and maintaining effective internal control over
compliance with the compliance requirements referred to above. In planning and performing our audit of
compliance, we considered the City’s internal control over compliance with the compliance requirements
that could have a direct and material effect on the City to determine the auditing procedures that are
appropriate in the circumstances for the purpose of expressing an opinion on compliance with general
state compliance requirements and to test and report on internal control over compliance in accordance
with the State Compliance Audit Guide, but not for the purpose of expressing an opinion on the
effectiveness of the internal control over compliance. Accordingly, we do not express an opinion on the
effectiveness of the City’s internal control over compliance.
A deficiency in internal control over compliance exists when the design or operation of a control over
compliance does not allow management or employees, in the normal course of performing their assigned
functions, to prevent, or detect and correct, noncompliance with a general state compliance requirement
on a timely basis. A material weakness in internal control over compliance is a deficiency, or combination
of deficiencies, in internal control over compliance, such that there is a reasonable possibility that material
noncompliance with a general state compliance requirement will not be prevented, or detected and
corrected, on a timely basis. A significant deficiency in internal control over compliance is a deficiency, or
a combination of deficiencies, in internal control over compliance with a general state compliance
requirement that is less severe than a material weakness in internal control over compliance, yet
important enough to merit attention by those charged with governance.
Our consideration of internal control over compliance was for the limited purpose described in the first
paragraph of this section and was not designed to identify all deficiencies in internal control over
compliance that might be material weaknesses or significant deficiencies. We did not identify any
deficiencies in internal control over compliance that we consider to be material weaknesses. However,
material weaknesses may exist that have not been identified.
The purpose of this report on internal control over compliance is solely to describe the scope of our
testing of internal control and compliance and the results of that testing based on the requirements of the
State Compliance Audit Guide. Accordingly, this report is not suitable for any other purpose.
Larson & Company, PC
Spanish Fork, Utah
November 30, 2020