HomeMy WebLinkAboutAudited Comprehensive Annual Financial Report (CAFR) FYE 06/30/2016 CITY OF PALM DESERT
PALM DESERT HOUSING AUTHORITY
Finance Department
Staff Report
Request: Receive and file the City of Palm Desert audited financial reports for the
fiscal year ended June 30, 2016
Submitted by: Jose Luis Espinoza, CPA, Assistant Finance Director
Date: February 9, 2017
Contents: 1. City of Palm Desert audited financial report for fiscal year ended
June 30, 2016
2. Auditor's letter to City Council
3. Independent Auditors' Report on Internal Control over Financial
Reporting and on Compliance and Other Matters based on an
Audit of Financial Statements Performed in Accordance with
Government Auditing Standards
4. Appropriations Limit Worksheet no. 6
Recommendation
By Minute Motion, that the City Council receive and file the audited
Comprehensive Annual Financial Report (CAFR) for the City of Palm Desert and
Palm Desert Housing Authority for the fiscal year ended June 30, 2016.
Strategic Plan Objective
Not applicable.
Committee Recommendation
The Audit, Investment and Finance Committee received the City of Palm Desert audited reports
at their January 24, 2017 meeting, and recommended that the report be received and filed by
the City Council.
Background
White Nelson Diehl Evans LLP performed and completed the annual independent audit for the
fiscal year ended June 30, 2016, for the City of Palm Desert, in accordance with generally
accepted auditing standards. In the auditor's opinion, the basic financial statements present
fairly, in all material respects, the financial position of the City of Palm Desert as of June 30,
2016, and the results of its operations and the cash flows of its proprietary funds for the year
then ended in conformity with accounting principles generally accepted in the United States of
America.
G:\Finance\Niamh Ortega\Staff Reports'Audit staff reports\Audit Staff Reports 2016\SR-Council audit 2016 CAFR.docx
Staff Report
Receive and file CAFR for Fiscal Year ended June 30, 2016
January 24, 2017
Page 2 of 2
In conducting their audit, the auditors test the City's internal controls. Attached is the Report on
Internal Controls over Financial Reporting and on compliance and other matters based on an
audit of Financial Statements performed in accordance with Government Auditing Standards.
The CAFR was submitted for the Certificate of Achievement for Excellence in Financial
Reporting from the Government Finance Officers Association. In order to be awarded a
Certificate of Achievement, a government must publish an easily readable and efficiently
organized comprehensive annual financial report. This report must satisfy both generally
accepted accounting principles and applicable legal requirements. We believe that our current
comprehensive annual financial report continues to meet the Certificate of Achievement
Program's requirements, as it has for the past 19 years.
For the City's General Fund, the actual ending revenues of $54.83 million were $0.48 million
more than the final budgeted revenues of $54.35 million. Sales and transient occupancy taxes
continue to be the top two revenue generators for the City totaling $30.25 million, or 55.17
percent of the total General Fund actual revenues. The General Fund actual ending
expenditures of$52.28 million were $3.44 million less than the final budget of$55.72 million.
Staff requests that the City Council receive and file the audited financial statements for the fiscal
year ended June 30, 2016.
Submitted b Approved by:
Jose is spinoza, CP Lauri Aylaian
Assi ant inance Director City Manager
Jan oore
erector of Finance/ City Treasurer
JLE:nmo
G:\Finance\Niamh Ortega\Staff Reports\Audit staff reports\Audit Staff Reports 2016\SR-Council audit 2016 CAFR.docx
WHITE NELSON 1)IEHL -EVANS LLP
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To the Honorable City Council
of the City of Palm Desert
Palm Desert, California
We have audited the financial statements of the governmental activities, the business-type activities,
the discretely presented component unit, each major fund, and the aggregate remaining fund
information of the City of Palm Desert (the City) for the year ended June 30, 2016. Professional
standards require that we provide you with information about our responsibilities under generally
accepted auditing standards, as well as certain information related to the planned scope and timing of
our audit. We have communicated such information in our engagement letter to you dated
November 10, 2015, and in our letter on planning matters to you dated August 17, 2016. Professional
standards also require that we communicate to you the following information related to our audit.
Significant Audit Findings
Qualitative Aspects of Accounting Practices
Management is responsible for the selection and use of appropriate accounting policies. The significant
accounting policies used by the City are described in Note 1 to the financial statements As discussed in
Note 1 to the financial statements, in fiscal year 2015-2016, the City implemented Governmental
Accounting Standards Board (GASB) Statement No. 72, "Fair Value Measurement and Application".
GASB Statement No. 72 requires the City to use valuation techniques which are appropriate under the
circumstances and are either a market approach, a cost approach or income approach. GASB Statement
No. 72 establishes a hierarchy of inputs used to measure fair value consisting of three levels. Level 1
inputs are quoted prices in active markets for identical assets or liabilities. Level 2 inputs are inputs,
other than quoted prices included within Level 1, which are observable for the asset or liability, either
directly or indirectly. Level 3 inputs are unobservable inputs, and typically reflect management's
estimates of assumptions that market participants would use in pricing the asset or liability. GASB
Statement No. 72 also contains note disclosure requirements regarding the hierarchy of valuation
inputs and valuation techniques that were used for the fair value measurements. There was no material
impact on the City's financial statements as a result of the implementation of GASB Statement No. 72.
No other accounting policies were adopted and the application of other existing policies was not
changed during the year ended June 30, 2016. We noted no transactions entered into by the City during
the year for which there is a lack of authoritative guidance or consensus. All significant transactions
have been recognized in the financial statements in the proper period.
Accounting estimates are an integral part of the financial statements prepared by management and are
based on management's knowledge and experience about past and current events and assumptions
about future events. Certain accounting estimates are particularly sensitive because of their
significance to the financial statements and because of the possibility that future events affecting them
may differ significantly from those expected.
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2873 Michelle Drive, Suite 300, Irvine, CA 92606 • Tel: 714.978.1300 • Fax: 714.978.7893
O(%ice.n Ioca/ed in Orange and San Diego Conntier
Significant Audit Findings (Continued)
Qualitative Aspects of Accounting Practices (Continued)
The most sensitive estimates affecting the City's financial statements were:
a. Management's estimate of the fair value of investments is based on market values
provided by outside sources.
b. Management's estimate of the value of capital assets (infrastructure) is based on
industry standards.
c. The estimated useful lives of capital assets used for depreciation purposes are based
on industry standards.
d. The annual required contributions, pension expense, net pension liability and
corresponding deferred outflows of resources and deferred inflows of resources for
the City's public defined benefit plans with CalPERS are based on actuarial
valuations provided by CalPERS.
e. The estimated net other post-employment benefit asset which is based on an
actuarial valuation provided by an outside consultant.
f. The claims liability for workers' compensation and general liabilities are based on
estimates by the claims administrators.
We evaluated the key factors and assumptions used to develop these estimates in determining that they
were reasonable in relation to the financial statements taken as a whole.
Certain financial statement disclosures are particularly sensitive because of their significance to
financial statement users. The most sensitive disclosure affecting the financial statements were
reported in Notes 6 and 10 regarding claims payable and risk management, Note 8 regarding the
defined benefit pension plan, Note 12 regarding other post-employment benefits, Note 17 regarding
recent changes in legislation effecting the dissolution of redevelopment agencies, and Note 18
regarding the Successor Agency disclosures.
The financial statement disclosures are neutral, consistent, and clear.
Difficulties Encountered in Performing the Audit
We encountered no significant difficulties in dealing with management in performing and completing
our audit.
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•
Significant Audit Findings (Continued)
Corrected and Uncorrected Misstatements
Professional standards require us to accumulate all known and likely misstatements identified during
the audit, other than those that are trivial, and communicate them to the appropriate level of
management. Management has corrected all such misstatements. In addition, none of the
misstatements detected as a result of audit procedures and corrected by management were material,
either individually or in the aggregate, to each opinion unit's financial statements taken as a whole.
Disagreements with Management
For purposes of this letter, a disagreement with management as a financial accounting, reporting, or
auditing matter, whether or not resolved to our satisfaction that could be significant to the financial
statements or the auditor's report. We are pleased to report that no such disagreements arose during the
course of our audit.
Management Representations
We have requested certain representations from management that are included in the management
representation letter dated December 16, 2016.
Management Consultations with Other Independent Accountants
In some cases, management may decide to consult with other accountants about auditing and
accounting matters, similar to obtaining a "second opinion" on certain situations. If a consultation
involves application of an accounting principle to the governmental unit's financial statements or a
determination of the type of auditor's opinion that may be expressed on those statements, our
professional standards require the consulting accountant to check with us to determine that the
consultant has all the relevant facts. To our knowledge, there were no such consultations with other
accountants.
Other Audit Findings or Issues
We generally discuss a variety of matters, including the application of accounting principles and
auditing standards, with management each year prior to retention as the governmental unit's auditors.
However, these discussions occurred in the normal course of our professional relationship and our
responses were not a condition to our retention.
Other Matters
We applied certain limited procedures the management's discussion and analysis, the schedule of
changes in the net pension liability and related ratios, the schedule of contributions - defined benefit
pension plan, the schedule of funding progress - other post-employment benefit plan, and the
budgetary comparison schedules, which are required supplementary information (RSI) that
supplements the financial statements. Our procedures consisted of inquiries of management regarding
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 did not audit the RSI and do not
express an opinion or provide any assurance on the RSI.
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•
Other Matters (Continued)
We were engaged to report on the General Fund budgetary comparison by department, and combining
and individual non-major fund financial statements and schedules (supplementary information), which
accompany the financial statements but are not RSI. With respect to this supplementary information,
we made certain inquiries of management and evaluated the form, content, and methods of preparing
the information to determine that the information complies with accounting principles generally
accepted in the United States of America, the method of preparing it has not changed from the prior
period, and the information is appropriate and complete in relation to our audit of the financial
statements. We compared and reconciled the supplementary information to the underlying accounting
records used to prepare the basic financial statements or to the basic financial statements themselves.
We were not engaged to report on the introductory and statistical sections, which accompany the
financial statements but are not RSI. We did not audit or perform other procedures on this other
information and we do not express an opinion or provide any assurance on them.
Restriction on Use
This information is intended solely for the use of City Council and management of the City of Palm
Desert and is not intended to be, and should not be, used by anyone other than these specified parties.
Irvine, California
December 16, 2016
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•
WHITE NELSON DIEHL EVANS LLI
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INDEPENDENT AUDITORS' REPORT ON INTERNAL CONTROL OVER
FINANCIAL REPORTING AND ON COMPLIANCE AND OTHER MATTERS
BASED ON AN AUDIT OF FINANCIAL STATEMENTS PERFORMED
IN ACCORDANCE WITH GOVERNMENT AUDITING STANDARDS
City Council
City of Palm Desert
Palm Desert, California
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, the discretely presented component unit, each major fund, and
the aggregate remaining fund information of the City of Palm Desert (the City), as of and for the year
ended June 30, 2016, and the related notes to the financial statements, which collectively comprise the
City's basic financial statements, and have issued our report thereon dated December 16, 2016.
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 opinion 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 City'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.
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2875 Michelle Drive,suite 300, Irvine, CA 92606 • 'Fe1: 714.978.1300 • Fax: 714.978.7893
Om located in Orange and San Diego Counties
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.
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
City'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 City's internal control and
compliance. Accordingly, this communication is not suitable for any other purpose.
Irvine, California
December 16, 2016
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CITY OF PALM DESERT
APPROPRIATIONS LIMIT WORKSHEET NO. 6
WITH INDEPENDENT ACCOUNTANTS'REPORT
ON AGREED-UPON PROCEDURES
APPLIED TO APPROPRIATIONS LIMIT WORKSHEET
FOR THE YEAR ENDED JUNE 30,2016
i •
WHITE NELSON IDI EHL EVANS LLB'
tiilt_C. �'Ll�t�3i ttt�FIlll;i_I ti\ i.�iYCI`+ilLW',
INDEPENDENT ACCOUNTANTS' REPORT
ON AGREED-UPON PROCEDURES APPLIED
TO APPROPRIATIONS LIMIT WORKSHEET
To the Honorable Mayor
and Members of City Council
City of Palm Desert
Palm Desert, California
We have performed the procedures enumerated below to the accompanying Appropriations Limit
Worksheet No. 6 of the City of Palm Desert, California for the year ended June 30, 2016. These
procedures, which were agreed to by the City of Palm Desert, California and the League of California
Cities (as presented in the League publication entitled "Article XIII-B Appropriations Limit Uniform
Guidelines") were performed solely to assist the City of Palm Desert, California in meeting the
requirements of Section 1.5 of Article XIIIB of the California Constitution. The City of Palm Desert's
management is responsible for the Appropriations Limit Worksheet No. 6.
This agreed-upon procedures engagement was conducted in accordance with attestation standards
established by the American Institute of Certified Public Accountants. The sufficiency of the
procedures is solely the responsibility of those parties specified in this report. Consequently, we make
no representation regarding the sufficiency of the procedures described below either for the purpose for
which this report has been requested or for any other purpose.
The procedures performed and our findings were as follows:
1. We obtained the completed Worksheet No. 6 for the year ended June 30, 2016, and compared the
limit and annual adjustment factors included in that worksheet to the limit and annual adjustment
factors that were adopted by resolution of the City Council. We also compared the population and
inflation options included in the aforementioned worksheet to those that were selected by a
recorded vote of the City Council.
No exceptions were noted as a result of this procedure.
2. For the accompanying Appropriations Limit Worksheet No. 6, we added last year's limit to the
total adjustments, and compared the resulting amount to this year's limit. We also recalculated the
adjustment factor and the adjustment for inflation and population, and compared the results to the
amounts on Worksheet No. 6.
No exceptions were noted as a result of this procedure.
- 1 -
2873 Michelle Drive, Suite 300,In-isle, CA 92606 • Tel: 714.978.1300 • Fax: 714.978.7893
O/ices loee'a/ed in Orange and San Diego Countier
• w
3. We compared the prior year appropriations limit presented in the accompanying Appropriations
Limit Worksheet No. 6 to the prior year appropriations limit adopted by the City Council for the
prior year.
No exceptions were noted as a result of our performing this procedure.
We were not engaged to, and did not, perform an audit, the objective of which would be the expression
of an opinion on the accompanying Appropriations Limit Worksheet No. 6. Accordingly, we do not
express such an opinion. Had we performed additional procedures, other matters might have come to
our attention that would have been reported to you. No procedures have been performed with respect
to the determination of the appropriation limit for the base year, as defined by the League publication
entitled "Article XIII-B Appropriations Limit Uniform Guidelines".
This report is intended solely for the information and use of the City Council and management of the
City of Palm Desert, California and is not intended to be, and should not be, used by anyone other than
these specified parties.
`7&1,
Irvine, California
December 16, 2016
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CITY OF PALM DESERT
APPROPRIATIONS LIMIT WORKSHEET NO. 6
For the year ended June 30, 2016
Appropriations limit for fiscal year ended June 30, 2015 (see Note 2) $ 106,102,286
Adjustment factors for the fiscal year ended June 30, 2016 (see Note 2):
Inflation Population
Factor Factor Combined
(Note 3) (Note 4) Factor
1.0382 1.0129 1.05159278 x 0.05159278
Adjustment for inflation and population 5,474,112
Other adjustments (Note 5) -
Total adjustments 5,474,112
Appropriations limit for fiscal year ended June 30, 2016 $ 111,576,398
See accompanying notes to Appropriations Limit Worksheet No. 6.
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CITY OF PALM DESERT
NOTES TO APPROPRIATIONS LIMIT WORKSHEET NO. 6
For the year ended June 30, 2016
1. PURPOSE OF LIMITED PROCEDURES REVIEW:
Under Article XIIIB of the California Constitution (the Gann Spending Limitation Initiative),
California governmental agencies are restricted as to the amount of annual appropriations from
proceeds of taxes. Effective for years beginning on or after July 1, 1990, under Section 1.5 of
Article XIIIB, the annual calculation of the appropriations limit is subject to a limited procedures
review in connection with the annual audit.
2. METHOD OF CALCULATION:
Under Section 10.5 of Article XIIIB, for fiscal years beginning on or after July 1, 1990, the
appropriations limit is required to be calculated based on the limit for the fiscal year 1986-87,
adjusted for the inflation and population factors discussed at Notes 3 and 4 below.
3. INFLATION FACTORS:
A California governmental agency may adjust its appropriations limit by either the annual
percentage change in the 4th quarter per capita personal income (which percentages are supplied by
the State Department of Finance), or the percentage change in the local assessment roll from the
preceding year due to the change of local nonresidential construction. The factor adopted by the
City of Palm Desert for the fiscal year 2015-2016 represents the annual percentage change in the
4th quarter per capita personal income.
4. POPULATION FACTORS:
A California governmental agency may adjust its appropriations limit by either the annual
percentage change of the jurisdiction's own population, or the annual percentage change in
population in the County where the jurisdiction is located. The factor adopted by the City of Palm
Desert for fiscal year 2015-2016 represents the annual percentage change in population for the
County in which the City of Palm Desert is located.
5. OTHER ADJUSTMENTS:
A California government agency may be required to adjust its appropriations limit when certain
events occur, such as the transfer of responsibility for municipal services to, or from, another
government agency or private entity. The City of Palm Desert had no such adjustments for the year
ended June 30, 2016.
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COMPREHENSIVE ANNUAL FINANCIAL REPORT
of the
CITY OF PALM DESERT, CALIFORNIA
For the Fiscal Year ended
June 30, 2016
Prepared by the Finance Department
City Treasurer/Director of Finance
Janet M. Moore
Assistant Finance Director
Jose Luis Espinoza, CPA
Finance Staff
(in alphabetical order by positions and last names)
ACCOUNTING TECHNICIAN II
James Bounds
ACCOUNTING TECHNICIAN II
Horacio Celaya
ACCOUNTING TECHNICIAN II
Sharon Christiansen
ACCOUNTING TECHNICIAN II
Diana Leal
ADMINISTRATIVE SECRETARY
Niamh Ortega
DEPUTY CITY TREASURER
Thomas Metz
G.I.S. TECHNICIAN
John Urkov
INFORMATION SYSTEMS MANAGER
Clayton von Helf
INFORMATION SYSTEMS TECHNICIAN
Troy Kulas
INFORMATION SYSTEMS TECHNICIAN
Ray Santos
MANAGEMENT ANALYST II
Jenny Weill
SENIOR FINANCIAL ANALYST
Anthony Hernandez
i
CITY OF PALM DESERT
TABLE OF CONTENTS
JUNE 30, 2016
Page
Number
INTRODUCTORY SECTION
Table of Contents i
Letter of Transmittal vii
GFOA Certificate of Achievement for Excellence in Financial Reporting xi
List of Principal Officials xiii
Organization Chart xiv
FINANCIAL SECTION
AUDITORS’ REPORT
Independent Auditors’ Report 1
MANAGEMENT’S DISCUSSION AND ANALYSIS 5
BASIC FINANCIAL STATEMENTS
Exhibit A - Statement of Net Position 17
Exhibit B - Statement of Activities 18
Exhibit C - Balance Sheet - Governmental Funds 22
Exhibit D - Reconciliation of the Balance Sheet of Governmental Funds
to the Statement of Net Position 25
Exhibit E - Statement of Revenues, Expenditures and Changes in Fund
Balances - Governmental Funds 26
Exhibit F - Reconciliation of the Statement of Revenues, Expenditures and
Changes in Fund Balances of Governmental Funds to the
Statement of Activities 28
Exhibit G - Statement of Net Position - Proprietary Funds 29
Exhibit H - Statement of Revenues, Expenses and Changes in Fund
Net Position - Proprietary Funds 30
ii
CITY OF PALM DESERT
TABLE OF CONTENTS
(CONTINUED)
JUNE 30, 2016
Page
Number
BASIC FINANCIAL STATEMENTS (CONTINUED):
Exhibit I - Statement of Cash Flows - Proprietary Funds 31
Exhibit J - Statement of Net Position - Fiduciary Funds 33
Exhibit K - Statement of Changes in Net Position - Fiduciary Funds 34
Notes to Basic Financial Statements 35
REQUIRED SUPPLEMENTARY INFORMATION
Schedule 1 - Schedule of Changes in the Net Pension Liability and Related Ratios 132
Schedule 2 - Schedule of Contributions - Defined Benefit Pension Plan 133
Schedule 3 - Schedule of Funding Progress:
Other Post-Employment Benefits Plan 134
Schedule 4 - Budgetary Comparison Schedule - General Fund 135
Schedule 5 - Budgetary Comparison Schedule - Prop A Fire Tax
Special Revenue Fund 136
Note to Required Supplementary Information 137
SUPPLEMENTARY SCHEDULES
General Fund: 139
Schedule 6 - Budgetary Comparison Schedule by Department - General Fund 140
Other Governmental Funds - Combining Statements: 145
Schedule 7 - Combining Balance Sheet - Other Governmental Funds 146
Schedule 8 - Combining Statement of Revenues, Expenditures and Changes
in Fund Balances - Other Governmental Funds 147
iii
CITY OF PALM DESERT
TABLE OF CONTENTS
(CONTINUED)
JUNE 30, 2016
Page
Number
SUPPLEMENTARY SCHEDULES (CONTINUED)
Other Governmental Funds - Other Special Revenue: 149
Schedule 9 - Combining Balance Sheet - Other Special Revenue Funds 152
Schedule 10 - Combining Statement of Revenues, Expenditures and Changes
in Fund Balances - Other Special Revenue Funds 156
Schedule 11 - Schedules of Revenues, Expenditures and Changes in Fund
Balance - Budget and Actual - Special Revenue Funds:
A. Traffic Safety 160
B. Gas Tax 161
C. Housing Mitigation Fees 162
D. Community Development Block Grant 163
E. Public Safety Police Grants 164
F. El Paseo Assessment District 165
G. Landscape and Lighting Districts No. 1-17 166
Other Governmental Funds - Other Debt Service: 167
Schedule 12 - Balance Sheet - Other Debt Service Fund 168
Schedule 13 - Statement of Revenues, Expenditures and Changes
in Fund Balances - Other Debt Service Fund 169
Other Governmental Funds - Other Capital Projects: 171
Schedule 14 - Combining Balance Sheet - Other Capital Projects Funds 172
Schedule 15 - Combining Statement of Revenues, Expenditures and Changes
in Fund Balances - Other Capital Projects Funds 176
Internal Service Funds: 181
Schedule 16 - Combining Statement of Net Position 182
Schedule 17 - Combining Statement of Revenues, Expenditures and Changes
in Fund Net Position 183
Schedule 18 - Combining Statement of Cash Flows 184
Agency Funds: 187
Schedule 19 - Combining Statement of Assets and Liabilities - All Agency Funds 188
Schedule 20 - Combining Statement of Changes in Assets and
Liabilities - All Agency Funds 189
iv
CITY OF PALM DESERT
TABLE OF CONTENTS
(CONTINUED)
JUNE 30, 2016
Page
Number
STATISTICAL SECTION
Description of Statistical Section 191
Financial Trends
Net Position by Component 192
Changes in Net Position 193
Fund Balances of Governmental Funds 195
Changes in Fund Balances of Governmental Funds 196
Graphs - Changes in Fund Balances of Governmental Funds 197
Supplemental Historical General Fund Revenues 198
Supplemental Graph - Historical General Fund Revenues 199
Supplemental Historical General Fund Expenditures 200
Supplemental Graph - Historical General Fund Expenditures 201
Supplemental Historical General Revenue and Expenditures Per Capita 202
Revenue Capacity
Assessed Value and Estimated Actual Value of Taxable Property 204
Historical Net Assessed Taxable Values Citywide and
Graph - Assessed Valuation Growth 205
Supplemental FY 2016 and 2015 Breakdown of Basic 1% Property
Tax Rate Not in Redevelopment Project Area 206
Property Tax Rates Direct and Overlapping Property Tax Rates 207
Principal Property Taxpayers 208
Property Tax Levies and Collections 209
Supplemental Top 25 Sales Tax Generators and
Graph - Historical Sales Tax Trends 210
Supplemental Taxable Sales by Category 211
Supplemental Principal Sales Tax Remitters 212
Debt Capacity
Ratios of Outstanding Debt by Type 213
Ratios of General Bonded Debt Outstanding 214
Supplemental Special Assessment Information 215
Direct and Overlapping Government Activities Debt 216
Legal Debt Margin Information 217
Pledged-Revenue Coverage 218
v
CITY OF PALM DESERT
TABLE OF CONTENTS
(CONTINUED)
JUNE 30, 2016
Page
Number
STATISTICAL SECTION
(CONTINUED)
Demographic and Economic Information
Demographic and Economic Statistics 219
Principal Employers 220
Supplemental Miscellaneous Statistics 221
Operating Information
Full-time Equivalent City Government Employees by Function/Program 222
Operating Indicators by Function/Program 223
Capital Asset Statistics by Function/Program 224
SUPPLEMENTAL REDEVELOPMENT AGENCY
STATISTICAL SECTION
Redevelopment Agency Project Areas Map 227
Project Area Statistics 229
Tax Allocation Bond Issue Information 230
FY 2015/2016 Breakdown of Basic 1% Property Tax Levy Rates 231
Historical Net Assessed Taxable Values:
Redevelopment Project Area No. 1 - Original 232
Change in Taxable Values:
Redevelopment Project Area No. 1 - Original 233
Historical Net Assessed Taxable Values:
Redevelopment Project Area No. 1 - Amended 234
Change in Taxable Values:
Redevelopment Project Area No. 1 - Amended 235
Historical Net Assessed Taxable Values:
Redevelopment Project Area No. 2 236
Change in Taxable Values:
Redevelopment Project Area No. 2 237
Historical Net Assessed Taxable Values:
Redevelopment Project Area No. 3 238
Change in Taxable Values:
Redevelopment Project Area No. 3 239
Historical Net Assessed Taxable Values:
Redevelopment Project Area No. 4 240
Change in Taxable Values:
Redevelopment Project Area No. 4 241
Historical Tax Increment - Redevelopment Property
Tax Trust Fund Summary 242
vi
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ciTY oF ���� a��E�r
December 16, 2096
73-5�0 �RED WARING Dit1VE
PALM ❑E5ERT, Cn�IFORNin gzz6o�z578
TEL: ��O 34b—ob�i
Fnx:7bo 34�-4564
info�palm-dcser�.vrg
Residents of Palm Des�rt,
Honorable Mayor and Members of the City Council
The Finance Department is pleased to present the Comprehensi�e Annual Financial Repart {CAFR} o�
the City of Palm Desert for the fiscal year ended June 30, 2096.
The financial statements are prepared in accordance with generally accepted accounting �ri�ciples
(GAAP) and the Go�ernmental Accounting Standards Board (GASB).We believe the data, as
presentecf, is accurate in a�l material res�ects and is presented in a manner that fairly repr�sents tF�e
�nancial position anc! changes in financial position of the City as measured by the financial activity of
each of its funds. We also believ� that a�{ disclosures necessary to enable the �eader to fully
understand the City's financial activikies have been presented, Responsibility for the accuracy,
completeness and reliability of the information contained in this repart rests with the City.
The City of Palm Desert conducts an annual audit, wF�ich is performed by an independent certified
pui�lic accountant. The independent audit of ihe City's financial statemenks for fiscal year ended June
3D, 2016, was conducted by White Nelson Diehl Evans, LLP. The auditor's unmodifed ("clean")
o�inion on the basic financial statements is included in the Financial S�ctian of this repor�.
As �art af the City's annual audit engagement, the auditors reviewed the City's internal control structure
as well as compliance wit� appficable laws anc� regulations, The results of the City's annual audit for
fiscal year ended June 30, 2016, pro�ided no instances o� material weaknesses in connection wikF� i�e
internal control structure or signi�cant violations of applicable laws and regulations.
As recfpients of federal, state and county financial resources, the City of PaEm Des�rt is required to
undergo an annual single audit. When applicable, infarmation related ta this single audit, including #he
scheduls of exp�nditures of federal awards, findings and recommendations, and auditor's reports on
the internal control siruct�re and compliance with appficable laws and regulations, is included in a
separately issued repor#. For the fscal y�ar ended June 30, 2016, the City is not required to have a
single auclit perFormed.
Management's discussion and analysis {MD&A) immediately follows the independent auditor's report
and �rovides a narrative introduction, averview, and analysis of the basic fi�ancial statements. MD&A
camplements this letter of transmitta! and should be read in conjunction with it.
�a������� �'ii
Resrdents of the City af Palm Desert, Honorable Mayor and Members of the City Coiincil
December 16, Z016
PRO�ILE OF THE CITY OF PALM DESERT
Located in Riverside County in tF�e geographical cen#�r of the Coachella Valley, Palm Desert was
incorporated on November 26, 1973, as a General Law City. On November 4, 9997, voters
overwhelmingly approved Measure LL adopting a city char�er.
Under the provisions of the charter, the City of Palm Desert has full authority over its own municipal
affairs including: bidding and contracking procedures; regulation of parks, Iibrariss, and other faci[itiss;
certain faes; imposition of taxes; municipal zoning; salaries of officials and employees; municipal
utilities; and m�nicipal eleckion procedures.
The City of Palm Desert operates under a Council-Manager form o� govetnment. The City Council
consists of five members efected by the residents of the City. Council terms are four years, and
electians occur in Novemb�r during even-nurr�ber�d years. Each December, the City Councif selects
the Mayor from among its members for a one-year isrm. The City Counci! appoir�ts the City Manager
and the City Attorney.
The City aperates as a"contract ciky," primarily utilizing agreements with other governmental entities,
pr�vate firms, and individuals to pravide many services. Contracied services includ�: police �rotection
througF� the County of Riverside; ftre protection tF�rough Cal-Fre; animal control; road maintenance and
construction services; legal services; landscape maintenance; ar�d r�creation program services. The
City is a member of the Califarnia Joint Powers Insurance Auihority that provides insurance coverage
for the City. Waste and recycling services are provided under a franchise agreement with Burrtec
Waste and Recyciing Services. The City provides traditior�af municipal, public enterprise, and housing
services as follows:
Municipal Services
Public improvements, infrastructure and maintenance
Public art and community promotion
Planning, zaning, building and engineeri�g
Housing and community develapment
Code enforcement and inspections
Econamic development, business support and energy
conservation
Legislative, city clerk, visitor's services, pubfic
information, general administration, fiscal senrices,
�uman resaurces, and risk management
Building inspectior�s ancf services
P�tblic Enterprise Services
Golf course
Office complex
internal service
Blended & Discrete Component Units
PD Housing Authority
PD Financing Authority
PD Recreational Facilities Carp.
The City mai�tains budgetary controls to ensure compliance with lega4 provisions embodied in ihe
annual ap�ropriated budge# approved by the City Council. Activities of the General, 5pecial Revenue,
Debk Service, a�d Capital Project Funds are included in the annuaf appropriated budget. Budgetary
amounts for Debt Service, CaPital Projects, and certain Special Revenue Funds are adopted annc�aily;
however, these budgets are considered to be long-term in nature.
viii
Residerrts of the City of Palm �esert, Honorable Mayor and Members of the City Council
December 16, 201 G
The City also maintains an encumbra�ce accounting system of purchase orders and contracts at the
fund level as a means af accomplishing budgetary control. Open encumbrances are reported as a
reservation of fund balance at the end af each �isca! year. Purchase orders are reviewed to �nsure that
funds are availabls and that requests are praperly authorized priflr to being released ta vendors.
The adopted budgek for fiscal year 2D15-20'i6 was prepared in accordance with accounting principlas
generally accept�d in th� United States o# Amarica. As reflecked in the statements and schedules
includad in the financiai section of this report, the City continues to meet its responsibility for sound
financial managemeni.
L.00AL ECONOMY
The City comprises an area of approximately 26 square miles and, as of January 1, 20�6, �as a
population of 49,335 according to da#a provided by the California Department of �ir�ance. In addition to
permanent residents, approximately 20,DOD seasonal residents make Palm Desert their home far ihree
to six months each year.
The City of Palm Deseri has cultivated a saund fou�dation of general fund r�venues including sales
tax, transient occupancy tax, licenses and permits, proper#y tax, and investment earnings. Tourism and
saEes tax are the City's main revenue sources. Due to the timing of Palm Desert's incorporation in 1973,
the City of Palm Desert receives less than 7 percent af #he post-Prop 93 property taxes; therefore the
City relies heavily on sales tax and tra�sient occupancy tax.
As a comm�nity wF�ere economic, environmental, social, and cuitural deve�opment flourishes, Paim
Desert is a much sought-after place to visit and reside. As the first city in Riverside County to create a
public art program, Palm Desert is hame to numerous cultural attractions including: the McCa�lum
Theatre far the Perfarming Arts, a 1,127-seat theater wnich hosts a wide variety of A-fist entertainers,
touring theatrical productions, and aris-related educatior�a! programs; The Living Desert wildlife and
botanica[ park, a 1,200-acre facility containing a wida array of plants and animals from desert regions
around the wor[d; and the Palm Desert Art in Public Places program, a museum without walls, featuring
mare than 150 works of a� on permanent display throughout the city.
Palm Desert's active, �ve-star accredited Chamber of Commerce has more than 1,125 members who
work to pramote, suppo�t, and enhance business prosperi#y, civic vitality, and the quality of life within
their community. Noted for its extensive array of retaif options, including the world-famous upscale
s�opping destination of EI Paseo, Palm Desert is home to a variety of maNs and retail centers including
Westfield Palm Desert, Desert Crossing, The Gardens on EI Paseo, and Ef Paseo Village.
The intemationally acclaimed Deser� Willow Golf Resort, one af the nation's premier municipal courses,
boasts 36 hol�s of champ�onshi� golf and stunning scenery in close proximity to first-class �o#el
accommodations and �ne dining_
In addition to being the home of the Coachella Valley's only community callege, Colfege of the Desert,
Palm Desert is the locatian o# saiellite campuses for both the University of California, Riverside, and
California State University, San Bernardina, the region's only public, fflur-year university.
CIYY �f pBIM DESERI
��
�, r�
Resrdents af the Ciry of Palm Desert, Horror•able Mayor and Members of the City Council
December 1 G, 1016
The State of California Employment Development Departm�nt Labar Market �nformation Division
reporteci that the City of Palm Desert had an unemployment rate of 4.2% compared to Riverside
Caunty, w�ich had a rate nf 6.7%. The City's balanced foundation of kaurism, culture, and education
has strengthened the City's labor force,
LONG-TERM FINANCIAL PLANNING
In June 201fi the City Council approved a total of $12.77 millifln in funding for various capital
improvement prajects for the fiscal year of 20'Efi-2017. Projects include traffic signals, sidewalk repairs
and construction, accessibility improvements, street widening, improving drainage areas, park
improvements, and improvements at Desert Willow Golf Resort.
Certificates of Awards for Outstandinq Financial Reuortinq
The Government Fir�ance Offic�rs Association of the United States and Canada (GFOA) awarded a
Certificate of Achievement for Excellence in Financial Reporting ta the City of Palm Desert for fts
comprei�ensive annua! financial report fflr tF�e fiscal y�ar ended June 30, 2015. This was the 19th
consecutive year that the City has ac�iev�d this prestigious award. In order to foe awarded a Certifcate
of Achievement, a government must publish an easify readabl� and efficiently organized
compr�hensive annual financial report. This report must satisfy both generaf accepked accounti�►g
princi�les and app�icah�e fegaE requirements.
A Certificate of Achievement is va�id for a period of one year only. We befieve that our current
comprehensive annual financial report continues ta meet t�e Certi�cate of Ac�ievem�nt Program's
requirements and we are submitting ik to the GFOA to determine its eligibility for another certi�cate.
Acknowledqments
The �reparation 0� ti1E5 report is attributabl� to the efficient and dedicated staff in th� Finance
Department individually recogniz�d on the title page. The Mayor and the City Co�ncil are credited for
their support in planning and canducting the operations of our Ciiy €n a conservative, respansib�e and
pragressive manner. Recognition is also given to all employees of the City of Palm Desert who conkinue
to serve our community with commitment and dedication throughout the year. And perhaps our greatest
appreciation goes to you the residents of Palm Desert, for your cflntinued support, input, and g�idance
in helping us seroe yo� bett�r, t�us preserving our City's qualfty of iife and repu#ation for innovation and
leadership.
Respectiully submitted,
`�auri Aylaian
City Manager
JLE:jIe
� I- - .� .��`�y--��
W J�n�Moore .
Director of Finance
x
Go�ernment Finance Officers Associatior�
Certificate of
Achievement
for Excellence
in Financial
Reporting
Presented to
City of Palm Desert
Ca�ifornia
For its Comprehensive Annual
Financial Report
for the Fiscal Year Ended
June 30, 2415
���
Executive Director/CE0
xii
THIS PAGE INTENTIONALLY LEFT BLANK
xiii
CITY OF PALM DESERT
List of Principal Officials
as of June 30, 2016
City Council - Manager Form of Government
CITY COUNCIL
ROBERT A. SPIEGEL
Mayor
JAN C. HARNIK
Mayor Pro-Tempore
SABBY JONATHAN
Council Member
VAN G. TANNER
Council Member
SUSAN MARIE WEBER
Council Member
CITY ADMINISTRATION
LAURI AYLAIAN
City Manager
City Attorney - Best, Best & Krieger, LLP Robert W. Hargreaves
Director of Finance/City Treasurer Janet M. Moore
SUCCESSOR AGENCY TO THE PALM DESERT REDEVELOPMENT AGENCY
LAURI AYLAIAN
Executive Director
Residents of the City of Palm Desert
Mayor and City Council
City Attorney City Manager
Administrative
Services
City Clerk Human
Resources
Information
Systems
Risk
Management
Finance / City
Treasurer
General Services
Accounting
Treasury & Cash
Management
Public Works
Administration
Engineering
Streets & Facility
Maintenance
Fleet
Maintenance
Landscape
Services
Transportation /
Traffic Signals
Parks &
Recreation
Community
Development
Planning
Code Compliance
Art in Public
Places
Building & Safety Police & Fire
Departments
Police
Department /
Traffic Patrol
Fire Department
/ Fire Marshal
Economic
Development
Promotions /
Advertising
Community
Services / Special
Events
Tourism
Affordable
Housing Successor Agency to
the Palm Desert
Redevelopment Agency
Commissions and Committees
xiv
2875 Michelle Drive, Suite 300, Irvine, CA 92606 • Tel: 714.978.1300 • Fax: 714.978.7893
Offices located in Orange and San Diego Counties
- 1 -
INDEPENDENT A UDITORS’ REPORT
To the Honorable Mayor and
Members of the City Council
City of Palm Desert, California
Report on Financial Statements
We have audited the accompanying financial statements of the governmental activities,the
business-type activities, the discretely presented component unit, each major fund and the aggregate
remaining fund information of the City of Palm Desert, California, (the City) as of and for the year
ended June 30, 2016, and the related notes to the basic 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.
Auditors’ Responsibility
Our responsibility is to express opinions on these basic 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 basic financial statements are free
from material misstatement.
An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in
the basic financial statements.The procedures selected depend on the auditors’ 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 auditors consider internal control relevant to the City’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 City’s internal control. Accordingl y, 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.
-2 -
Opinions
In our opinion, the basic financial statements referred to above present fairly, in all material respects,
the respective financial position of the governmental activities,the business-type activities, the
discretely presented component unit,each major fund, and the aggregate remaining fund information
of the City, as of June 30,2016, 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.
Other Matters
Required Supplementary Information
Accounting principles generally accepted in the United States of America require that the
management’s discussion and analysis,the schedule of changes in the net pension liability and related
ratios, the schedule of contributions -defined benefit pension plan,the schedule of funding progress -
other post-employment benefits plan,and the budgetary comparison schedules for the General Fund
and the Prop A Fire Ta x Special Revenue Fund, identified as Required Supplementary Information
(RSI) in the accompanying 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 RSI 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 the audit of the basic financial statements. We do not express an
opinion or provide any assurance on the RSI 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 the City’s basic financial statements. The introductory section, supplementary
schedules and statistical section are presented for purposes of additional analysis and are not a required
part of the basic financial statements.
The supplementary schedules 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 supplementary schedules are fairly stated in all material respects in relation to the basic
financial statements as a whole.
-3 -
Other Matters (Continued)
Other Information (Continued)
The introductory and statistical sections have not been subjected to the auditing procedures applied in
the audit of the basic financial statements and, accordingly, we do not express an opinion or provide
any assurance on them.
Other Reporting Required by Government Auditing Standards
In accordance with Government Auditing Standards, we have also issued our report dated
December 16,2016,on our consideration of the 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
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 the City’s internal
control over financial reporting and compliance.
Irvine, California
December 16, 2016
-4 -
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-5 -
CITY OF PALM DESERT
MANAGEMENT’S DISCUSSION AND ANALYSIS
Our discussion and analysis of the City of Palm Desert’s financial performance for the fiscal year ended
June 30, 2016 provides:a comparison of current year to prior year ending results based on the
government-wide financial statements; an analysis of the City’s overall financial position and results of
operations to assist users in evaluating the City’s financial position; a discussion of significant changes
that occurred in the funds; and significant budget variances. In addition, it describes the activities during
the year for capital assets and long-term debt. We end our discussion and analysis with a description of
known facts, decisions, and conditions that are expected to have a significant effect on the financial
position or results of operations. Please read it in conjunction with the transmittal letter and the City’s
financial statements.
FINANCIAL HIGHLIGHTS
The City’s total assets exceeded its liabilities by $806.43 million (net position).
The City’s governmental activities net position increased by $50.60 million,and the net position of
the business-type activities decreased $0.75 million.
During the year,the City’s revenues were $91.78 million and expenses were $113.56 million in its
governmental activities, excluding transfers and extraordinary gain,compared to fiscal year 2015,
where revenues were $93.62 million and expenses were $88.12 million.
In the City’s business-type activities, expenses were $0.51 million more than the $8.66 million
generated in golf course green fees, merchandise sales, rental income and other revenues
compared to the prior year, where business-type activities revenues were $0.06 million less than
its expenses.
The City’s governmental activities program revenues and general revenues decreased by $1.84
million, or 1.97 percent from prior year, while program expenses increased $25.44 million, or
28.87 percent from prior year.
Business-type activities revenues decreased $0.65 million,from $9.31 million to $8.66 million.
Expenses decreased from the $9.37 million to $9.17 million.
The revenues available for expenditures were $0.48 million more than budgeted in the General
Fund.The City kept its General Fund expenditures within spending limits by $3.44 million.
USING THIS ANNUAL REPORT
This annual report consists of a series of financial statements. The Statement of Net Position and
Statement of Activities (on pages 17, 18 and 19) provide information about the activities of the City as a
whole and present a long-term view of the City’s finances. The fund financial statements start on Page
22.For governmental activities, these fund statements tell how these services were financed in the short
term as well as what remains for future spending. The fund financial statements also report the City’s
operation in more detail than the government-wide statements by providing information about the City’s
most significant funds and other funds. The remaining fiduciary fund statement provides financial
information about activities for which the City acts solely as a trustee or agent for the benefit of those
outside of the government.
-6 -
REPORTING THE CITY AS A WHOLE
The Statement of Net Position and the Statement of Activities:
Our analysis of the City as a whole begins on page 17. One of the most important questions asked about
the City’s finances is, “Is the City as a whole better off or worse off as a result of the year’s activities?”
The Statement of Net Position and the Statement of Activities report information about the City as a whole
and about its activities in a way that answers this question. These statements include all assets and
liabilities of the City using the accrual basis of accounting, which is similar to the accounting used by most
private-sector companies. All of the current year’s revenues and expenses are taken into account
regardless of when cash is received or paid.
These two statements report the City’s net position and changes in them.Net position is the difference
between total assets and deferred outflows of resources less liabilities, which is one way to measure the
City’s financial health, or financial position.Over time, increases or decreases in the City’s net position
are an indication of whether its financial health is improving or deteriorating.Other non-financial factors
should be considered, however, such as changes in the economy that could cause a decrease in
consumer spending.
In the Statement of Net Position and the Statement of Activities, we separate City activities as follows:
Governmental activities –Most of the City’s basic services are reported in this category, including
general administration (city manager, city clerk, finance, etc.),housing and redevelopment, public safety
(police and fire protection), public works, parks &recreation,and culture departments. Property taxes,
sales tax, transient occupancy tax, user fees, interest income, franchise fees, state and federal grants,
contributions from other agencies, and other revenues finance these activities.
Business-type activities –The City charges a fee to customers to cover all or most of the cost of certain
services it provides. The City’s municipal golf course, Desert Willow, and the City’s Parkview Office
Complex activities are reported in this category.
Component unit activities –The City includes one separate legal entity in its report –the Palm Desert
Recreation Facilities Corporation. Although legally separate, this “component unit” is important because
the City is financially accountable for it.
REPORTING THE CITY’S MOST SIGNIFICANT FUNDS
Fund Financial Statements:
The fund financial statements provide detailed information about the most significant funds and other
funds, not the City as a whole.Some funds are required to be established by State law and by bond
covenants.However, management established many other funds to help it control and manage money for
particular purposes or to show that it is meeting legal responsibilities for using certain taxes, grants, and
other resources.The City has three types of funds: governmental,proprietary and fiduciary.
Governmental funds –Most of the City’s basic services are reported in governmental funds, which focus
on how money flows in and out of those funds and the balances left at year-end that are available for
spending. These funds are reported using an accounting method called modified accrual accounting,
which measures cash and all other financial assets that can readily be converted to cash. The
governmental fund statements provide a detailed short-term view of the City’s general government
operations and the basic services it provides. Governmental fund information helps determine whether
there are more or fewer financial resources that can be spent in the near future to finance the City’s
programs. The differences of results in the Governmental Fund financial statements to those in the
Government-wide financial statements are explained in a reconciliation following each Governmental
Fund financial statement.
-7 -
Proprietary funds –When the City charges customers for the services it provides, these services are
generally reported in proprietary funds.Proprietary funds are reported in the same way that all activities
are reported in the Statement of Net Position and the Statement of Activities.The City’s enterprise funds
are the same as the business-type activities we report in the government-wide statements,but provide
more detail and information such as a statement of cash flows.
Fiduciary funds –Fiduciary funds are used to account for resources held for the benefit of parties
outside the government. Fiduciary funds are not reflected in the government-wide financial statement
because the resources of those funds are not available to support the City of Palm Desert operations.
The accounting used for fiduciary funds is much like that used for proprietary funds.
THE CITY AS TRUSTEE
Reporting the City’s Fiduciary Responsibilities:
The City is the trustee, or fiduciary, for the Successor Agency to the Palm Desert Redevelopment
Agency’s (Successor Agency) private-purpose trust fund and for certain agency funds held on behalf of
developers and its employees’retiree service stipend fund. The City’s fiduciary activities are reported in
separate Statements of Net Position, Statement of Changes in Net Position, Statement of Assets and
Liabilities, and Statement of Changes in Assets and Liabilities.We exclude these activities from the City’s
other financial statements because the City cannot use these assets to finance its operations. The City is
responsible for ensuring that the assets reported in these funds are used for their intended purposes.
THE CITY AS A WHOLE
During the fiscal year ending June 30, 2016, the City’s combined net position increased $49.85 million
from $756.58 million to $806.43 million. A separate review of the net change in the governmental and
business-type activities is provided for the reader. Our analysis focuses on the net assets (Table 1) and
changes in net assets (Table 2) of the City’s governmental and business-type activities.
-8 -
2016 2015 2016 2015 2016 2015
Current and restricted assets 340.25$ 279.69$ 5.57$ 5.25$ 345.82$ 284.94$
Capital assets 459.64 473.72 71.13 72.56 530.77 546.28
TOTAL ASSETS 799.89 753.41 76.70 77.81 876.59 831.22
Deferred outflows of resources 4.26$ 3.39$ -$ -$ 4.26$ 3.39$
Long-term liabilities
outstanding 42.71 43.87 0.93 1.44 43.64 45.31
Other liabilities 26.03 26.62 1.09 0.94 27.12 27.56
TOTAL LIABILITIES 68.74 70.49 2.02 2.38 70.76 72.87
Deferred inflows of resources 3.66$ 5.16$ -$ -$ 3.66$ 5.16$
Net position:
Net investment in capital
assets 459.64 473.72 70.20 71.13 529.84 544.85
Restricted 193.30 135.90 - - 193.30 135.90
Unrestricted 78.81 71.53 4.48 4.30 83.29 75.83
TOTAL NET
POSITION 731.75$ 681.15$ 74.68$ 75.43$ 806.43$ 756.58$
TABLE 1
NET POSITION
As of June 30, 2016 and 2015
TotalActivities
Business-TypeGovernmental
Activities
(IN MILLIONS)
-
200
400
600
800
1,000
1,200
2016 2015 2016 2015 2016 2015
Governmental
Activities
Business-Type
Activities
TotalDollars in MillionsTa ble 1 -Graph
To tal Assets & Liabilities
Total Assets
Total Liabilities
-9 -
The City’s governmental activities net position increased by 7.43 percent, or $50.60 million. The City’s net
position is made up of three components: Net investment in capital assets;restricted net position;and
unrestricted net position. For governmental activities, unrestricted net position, which represents the part
of net position that can be used to finance day-to-day operations, accounted for 10.77 percent of the
overall total net position. Unrestricted net position increased $7.28 million from $71.53 million in 2015 to
$78.81 million in 2016. The increase can be contributed to three areas; first,there was an increase in
sales tax, property taxes and transient occupancy tax totaling $2.82 million. Second, the City was allowed
to account for interest earned that totaled $2.27 million on advances that the City has with the Successor
Agency, and third, there was a net effect of $3.03 million decrease in the reporting of the City’s pension
liability that increased the unrestricted net position.
The increase of $57.40 million in restricted net position was due to the following:restricted capital projects
increased by $48.79 million from $55.61 million in 2015 to $104.40 million in 2016. On April 15, 2015 the
Department of Finance approved Oversight Board Resolution OB-115 and OB-116 authorizing approval
of a Non-Housing and a Housing Bond Proceeds Funding Agreements,and transfer of the remaining
bond proceeds to the City in the amount of $65.57 million and the Low and Moderate Housing Income
Asset Fund in the amount of $6.57 million from the Successor Agency, respectively. The transferred bond
proceeds are to be used to complete the projects identified in each of the respective agreements, or other
projects that are consistent with the bond covenant and of benefit to the project areas. Along with the
increase of the $65.57 million in bond proceeds to the City, property owners agreed to use unspent
capital bond funds to call outstanding debt that decreased restricted capital projects by $19.58 million.
Restricted special projects increased by $8.60 million,the majority of which is attributable to the bond
proceeds transferred to the Low and Moderate Housing Income Asset Fund in the amount of $6.57 million
and interest earned totaling $0.75 million on advances that the City has with the Successor Agency.
Investment in capital assets decreased $14.08 million.The calculation of investment in capital assets
includes outstanding debt used to purchase or construct the City’s capital assets.During the year the City
completed the improvement on the Monterey interchange improvements totaling $10.40 million and, upon
completion,transferred the asset to Caltrans, which accounted for the majority of the decrease.
The net position of the business-type activities saw a decrease of $0.75 million, from $75.43 million to
$74.68 million. The main factors for the decrease in net position were the transfer out and depreciation
expense. Total liabilities decreased $0.36 million from $2.38 million in 2015 to $2.02 million in 2016.The
decrease is due to the debt payments on the golf course golf cart leases (see Note 6).
The City’s governmental activities total assets and deferred outflow of resources combined, increased
$47.35 million from $756.80 million in 2015 to $804.15 million in 2016. The increase is attributable to the
transfer of restricted bond proceeds described above totaling $72.14 million from the Successor Agency.
Other major changes that affected total assets and deferred outflow combined, were the capital assets
decrease of $14.08 million which included the transfer to Caltrans and the use of unspent capital bonds to
recall outstanding debt which caused restricted assets to decrease.
Total liabilities and deferred inflows combined, decreased by $3.25 million from $75.65 in 2015 to $72.40
million in 2016. The decrease is due to debt payments made during the year and a net decrease in the
deferred inflows of resources of $1.50 million.
-10 -
2016 2015 2016 2015 2016 2015
REVENUES:
Program Revenues:
Charges for services 22.78$ 22.65$ 8.52$ 9.20$ 31.30$ 31.85$
Operating grants and
contributions 9.50 7.51 - - 9.50 7.51
Capital grants and
contributions 10.84 19.30 0.11 0.05 10.95 19.35
General Revenues:
Property taxes 11.02 10.29 - - 11.02 10.29
Transient occupancy tax 11.43 10.93 - - 11.43 10.93
Sales tax 19.20 17.61 - - 19.20 17.61
Other taxes 3.10 3.10 - - 3.10 3.10
Investment earnings 2.07 0.49 0.03 0.01 2.10 0.50
Gain on sale of capital assets 0.02 0.01 - 0.05 0.02 0.06
Other revenues 1.82 1.73 - - 1.82 1.73
TOTAL REVENUES 91.78 93.62 8.66 9.31 100.44 102.93
EXPENSES:
General government 14.84 16.34 - - 14.84 16.34
Housing and redevelopment 8.16 11.67 - - 8.16 11.67
Public safety 34.01 32.08 - - 34.01 32.08
Parks, recreation and culture 9.22 8.60 - - 9.22 8.60
Public works 47.04 19.14 - - 47.04 19.14
Interest on long-term debt 0.29 0.29 - - 0.29 0.29
Golf Course-Desert Willow - - 8.16 8.43 8.16 8.43
Office Complex-Parkview - - 1.01 0.94 1.01 0.94
TOTAL EXPENSES 113.56 88.12 9.17 9.37 122.73 97.49
INCREASE (DECREASE ) IN NET
POSITION BEFORE TRANSFERS (21.78) 5.50 (0.51) (0.06) (22.29) 5.44
Transfers 0.24 0.44 (0.24) (0.44) - -
Extraordinary Gain 72.14 - - - 72.14 -
INCREASE (DECREASE) IN NET POSITION 50.60 5.94 (0.75) (0.50) 49.85 5.44
BEGINNING NET POSITION, AS RESTATED 681.15 675.21 75.43 75.93 756.58 751.14
ENDING NET POSITION 731.75$ 681.15$ 74.68$ 75.43$ 806.43$ 756.58$
TABLE 2
CHANGES IN NET POSITION
As of June 30, 2016 and 2015
TotalActivities
Business-TypeGovernmental
Activities
(IN MILLIONS)
-11 -
Table 2-Graph
Changes in Net Position
Governmental Activities
Total revenue (excluding transfers and extraordinary gain)decreased from $93.62 million to $91.78
million, a 1.97 percent decrease. The decrease is partially the result of the capital grants and
contributions decrease of $8.46 million.Other factors that contributed to the changes in revenues are as
follows:
The Housing Authority received proceeds from bonds issued by the former redevelopment
agency for the construction of the Carlos Ortega Villas apartment complex totaling $11.61 million
in 2015. As the project was completed in 2016, that amount decreased to $5.42 million resulting
in a total decrease of $6.19 million.
In the prior year, the City recognized deferred revenue from the Monterey Interchange project
totaling $4.58 million. In the current year, that amount decreased by $3.45 million to $1.13 million.
SB 107 allows cities to accrue interest at a rate of 3 percent annually on outstanding advances to
the Successor Agency. The City had not accrued interest since January of 2011 because of the
uncertainty of collecting the interest. As a result of the City’s total advance of $22.65 million to the
Successor Agency, the City recognized $3.74 million in interest revenue for all funds that have
advances to the Successor Agency.
The City’s combined general property taxes, transient occupancy tax and sales tax increased by
$2.82 million from $38.83 million in 2015 to $41.65 million in 2016.
Total expenses increased from $88.12 million to $113.56 million, a 28.87 percent increase. The primary
reason for the increase was in the public work function that increased 27.90 million. The increase was
attributed to the capital assets transfer to Caltrans of the Monterey interchange and the use of unspent
capital bond funds to defease a portion of the debt for the University Park Community Facilities District.
Additional factors in the change in amount of expenses for the ye ar include:general government
decreased $1.50 million;Housing and Redevelopment decreased $3.51 million;and public safety
increased $1.93 million which was attributed to the increase in police costs from $18.31 million to $19.67
million and the increase in fire protection services from $10.89 million to $11.41 million; and parks,
recreation and culture increased $0.62 million.
-
100
200
300
400
500
600
700
800
2016 2015
Governmental ActivitiesDollars in millions -
10
20
30
40
50
60
70
80
2016 2015
Business-Type Activities
Beginning Net
Position
Total Revenues
Ending Net
Position
Total Expenses
-12 -
The following schedule represents the net cost of providing services:
Governmental Activities
Net (Expense) Revenue
(In Millions)
Business-type Activities
In the business-type activities,total revenues decreased by 6.98 percent from $9.31 million to $8.66
million, a $0.65 million decrease. The overall decrease was related to the closure of the Firecliff Golf
Course for the bunker renovation, as well as a softer market demand for golf. The closure and downturn
in demand for golf reduced overall green fees and merchandise sales revenues by $0.65 million. Desert
Willow Golf Resort management continued to utilize a strategic pricing structure which allowed the golf
resort to retain the course utilization with minimal impact to the overall average green fee. The overall
rounds mix and play remained consistent with the previous years.
The Parkview Office Complex revenues decreased minimally. During the last quarter of the fiscal year two
tenants at Parkview decided not to continue their leases,which accounted for the reduced rent revenue.
During the month of June 2016 a new tenant began occupying one of the vacant suites, which will
mitigate the impact of the lost revenue associated with the loss of two tenants.
Operating expenses for business-type activities decreased by $0.20 million from $9.37 million to $9.17
million. Both Desert Willow and the City continued to implement effective and efficient methods to control
costs without impacting service.
2016 2015
General government ($10.44)($11.96)
Housing and redevelopment 5.47 8.58
Public safety (23.05)(21.71)
Parks, recreation and culture (5.16)(5.96)
Public works (36.98)(7.31)
Interest on long term debt (0.29)(0.29)
Total ($70.45)($38.65)
13%
-6%
29%
6%
46%
0%
2016
Governmental Activities
Net (Expense) Revenue
21%
-16%
39%
11%12%1%
2015
Governmental Activities
Net (Expense) Revenue General government
Housing and
redevelopment
Public safety
Parks, recreation &
culture
Public works
Interest on long
term debt
-13 -
THE CITY’S FUNDS
On Page 22, the governmental funds balance sheet is shown. The combined fund balance of $288.43
million increased from $227.20 million, or 26.95 percent. This total includes the General Fund balance of
$82.36 million, which increased by $2.55 million from prior year. The City’s General Fund balance has a
non-spendable balance of $9.53 million that includes advances, loans and notes, and prepaid costs,plus
$0.99 million in assigned fund balance,and $71.84 million of unassigned fund balance. The change in the
General Fund’s balance was due to growth in sales taxes, property taxes and transient occupancy tax.
Other major fund balance changes are noted below:
The Prop A Fire Tax Special Revenue Fund: The fund balance increased from $1.81 million to
$2.30 million, a $0.49 million increase.The City transferred $3.00 million to cover the shortage
and increase the Prop A Fire reserve.An increase in contract costs has caused the City to budget
additional funds from its General Fund.
The Low and Moderate Housing Income Asset Fund:The fund balance had an increase of $6.66
million. The low and moderate income housing asset fund received bond proceeds from the
Successor Agency in the amount of $6.57 million as previously discussed.
Measure A Special Revenue Fund: the fund balance increased from $14.78 million to $19.25
million, a 30.24 percent increase. The increase in the fund balance is due to the increase in
intergovernmental revenue of $3.21 from the prior year. This was the receipt from federal and
state grants for the Monterey Interchange project.
Housing Authority Fund: This fund had a minor increase of $0.03 million from $20.71 million to
$20.74 million.
CFD University Capital Project Fund:The fund balance decreased from $21.35 million to $1.81
million due to the transferring of unspent capital bond funds to call outstanding debt.
Capital Properties Fund: The fund balance increased $65.70 million from $0.01 million to $65.71
million. The increase was due to the bond proceeds from the Successor Agency as described
previously.
More detailed information about the combined fund balance reserves is presented in Note 9 to the
financial statements.
General Fund Budgetary Highlights
Based upon recommendations from the staff, the City Council revised the budget several times during the
year. Adjustments were made on a monthly basis as City staff requested additional appropriations to
cover the cost of projects that either had change orders for additional work, or were underestimated. At
mid-year, adjustments were made as department heads requested adjustments to their budgets to meet
current demands. At year-end, budgets were adjusted for unanticipated approved expenditures. All
amendments that either increase or decrease appropriations are approved by the City Council.
For the City’s General Fund, the actual ending revenues of $54.83 million were $0.48 million more than
the final budgeted revenues of $54.35 million.Sales and transient occupancy taxes continue to be the top
two revenue generators for the City totaling $30.25 million,or 55.17 percent of the total General Fund
actual revenues.
The General Fund actual ending expenditures of $52.28 million were $3.44 million less than the final
budget of $55.72 million.There were changes in the original budget compared to the final budget during
the year. The original expenditure budget was $51.71 million compared to the final budget of $55.72
million, a $4.01 million increase. The major change was due to the appropriations of an additional $0.76
million in transfers out to other funds for compensated absences and retiree health stipends.In addition to
the transfers, the street resurfacing budget increased $0.88 million.
-14 -
CAPITAL ASSETS AND DEBT ADMINISTRATION
Capital Assets
At the end of 2016, the City had $530.77 million invested in a broad range of capital assets, including
land, streets, bridges, drainage systems, traffic lights, parks, buildings, art work, vehicles, golf courses
and equipment (See Table 3).This amount represents a net decrease (including additions and
deductions) of $15.51 million over the prior year due mainly to the transfer of the Monterey interchange
improvements to Caltrans.
2016 2015 2016 2015 2016 2015
Land 79.63$ 79.25$ 52.74$ 52.74$ 132.37$ 131.99$
Construction-in-progress 2.83 26.14 - - 2.83 26.14
Buildings and improvements
other than buildings 111.66 99.56 17.26 18.11 128.92 117.67
Machinery and equipment 2.40 2.18 1.13 1.71 3.53 3.89
Infrastructure & right-of-way 263.12 266.59 - - 263.12 266.59
TOTALS 459.64$ 473.72$ 71.13$ 72.56$ 530.77$ 546.28$
TABLE 3
CAPITAL ASSETS AT YEAR-END
For the years ended June 30, 2016 and 2015
TotalActivities
Business-TypeGovernmental
Activities
(NET OF DEPRECIATION, IN MILLIONS)
-
100
200
300
400
500
600
700
2016 2015 2016 2015 2016 2015
Governmental
Activities
Business-Type
Activities
TotalDollars in millionsTable 3 -Graph
Capital Assets at Year-End
(Net of Depreciation in Millions)
Land
Construction in Progress
Buildings and Improvements
Equipment
Infrastructure
Totals
-15 -
This year’s major additions included (in millions):
Affordable housing apartment complex $ 5.17
Street improvements 1.24
Equipment and software purchases 0.39
Land acquisitions 0.59
$ 7.39
The City’s fiscal year 2016 adopted capital budget calls for an additional $12.77 million to be spent plus
continuing capital projects of $37.19 million from prior year,with the majority being spent on street,
infrastructure and golf course improvements. Projects will be funded with existing bond proceeds or funds
that have been designated by an outside party for specific use. More detailed information about the City’s
capital assets is presented in Note 1g and Note 5 to the financial statements.
Debt
At year-end, the City’s governmental activities had $42.71 million in bonds, claims,compensated
absences and pension liability versus $43.87 million last year, a decrease of $1.16 million as shown in
Table 4. The major decrease was the City’s pension liability that went from $37.60 million to $36.93
million.
2016 2015 2016 2015 2016 2015
Compensated absences payable 2.41$ 2.67$ -$ -$ 2.41$ 2.67$
Capital leases - - 0.93 1.44 0.93 1.44
Claims and judgements payable 0.32 0.30 - - 0.32 0.30
Special assessments debt with
government commitment 1.45 1.49 - - 1.45 1.49
Limited Obligation Improvement
bonds 1.60 1.81 - - 1.60 1.81
Lease revenue bond - - - - - -
Pension liability 36.93 37.60 - - 36.93 37.60
TOTALS 42.71$ 43.87$ 0.93$ 1.44$ 43.64$ 45.31$
TABLE 4
OUTSTANDING DEBT, AT YEAR-END
For the years ended June 30, 2016 and 2015
TotalActivities
Business-TypeGovernmental
Activities
(IN MILLIONS)
-16 -
The City was able to meet its current year debt obligation in a timely manner.Bonds that were issued in
prior years have been used to finance various capital projects.
The City’s business-type activities debt decreased $0.51 million from $1.44 million to $0.93 million. Debt
in the business-type activities is for capital leasing of equipment. The City’s golf course uses leasing as
an alternative to purchasing golf carts and maintenance equipment to maintain a cash flow to operate the
day-to-day activities. The decrease in the City’s business-type activities debt was directly related to the
principal payments made towards the equipment leases. The City’s business-type activities were able to
meet its current year debt obligation in a timely manner. More detailed information about the City’s long-
term liabilities is presented in Note 6 to the financial statements.
ECONOMIC FACTORS AND NEXT YEAR’S BUDGETS
In preparing the budget for fiscal ye ar 2017, management focused on two core principles:1) minimize the
impact of budget cuts to key services and maintain the level of service expected by residents,
businesses, and visitors;and 2) review standards of infrastructure maintenance and operation and adjust
standards to provide quality City facilities in line with budget considerations, including but not limited to
parks, roads, and buildings. The following economic factors were considered by management:
In the five-year Capital Improvement Program, all restricted capital funds have been allocated to
various projects.As a result, any additional projects would require a transfer from the general
fund, which would mean a decrease to the City’s unobligated general fund reserve.A detailed
analysis will be performed and a cost benefit approach will be employed before the general fund
reserves are decreased for capital improvements.
Increase in healthcare and retirement costs.
Increase in police and fire protection services.
The 2017 budget is a reflection of the City’s commitment to the residents of Palm Desert. The City’s
conservative approach has provided for a consistently high level of services. The City has made a
commitment to allocate resources for public safety, cultural/social programs, and necessary infrastructure
improvements. Copies of the City’s 2016-2017 Financial Plan can be obtained by contacting the City’s
Finance Department or by visiting the City’s website at www.cityofpalmdesert.org.
CONTAC TING THE CITY’S FINANCIAL MAN AGEMENT
This financial report is designed to provide our residents, taxpayers, customers, investors,and creditors
with a general overview of the City’s finances and to show the City’s accountability for the money it
receives. If you have questions about this report or need additional financial information, contact the
Finance Department at the City of Palm Desert, 73-510 Fred Waring Drive, Palm Desert, California
92260-2578, or (760) 346-0611.
Exhibit A
Component
Unit
Palm Desert
Recreational
Governmental Business-type Facilities
Activities Activities Total Corporation
Cash and investments 167,422,130$ 4,500,933$ 171,923,063$ 157,958$
Receivables:
Accounts 2,233,498 62,723 2,296,221 15,827
Notes 1,452,200 - 1,452,200 -
Interest 4,470,539 - 4,470,539 -
Loans 11,083,148 - 11,083,148 -
Internal balances 500,000 (500,000) - -
Prepaid costs 409,076 74,817 483,893 9,135
Inventories 4,431 258,346 262,777 41,190
Deposits 15,052,983 - 15,052,983
Due from other governments 10,899,837 - 10,899,837 -
Property held for resale 61,516 - 61,516 -
Due from component unit 285,000 1,170,647 1,455,647 -
Advances to Successor Agency 36,723,138 - 36,723,138 -
Restricted assets:
Cash with fiscal agent 80,929,557 - 80,929,557 -
Net OPEB asset 8,724,737 - 8,724,737 -
Capital assets, not being depreciated 203,514,311 52,736,087 256,250,398 -
Capital assets, being depreciated 256,130,409 18,396,260 274,526,669 -
TOTAL ASSETS 799,896,510 76,699,813 876,596,323 224,110
DEFERRED OUTFLOWS OF RESOURCES:
Deferred outflows from pensions 4,260,098 - 4,260,098 -
Accounts payable 9,504,915 867,034 10,371,949 32,896
Accrued liabilities 530,775 75,576 606,351 13,817
Interest payable 92,171 - 92,171 -
Unearned revenues 15,212,777 119,631 15,332,408 68,311
Deposits payable 689,420 25,650 715,070 -
Due to primary government - - - 1,455,647
Long-term liabilities:
Due within one year 457,000 429,980 886,980 -
Due in more than one year 5,325,997 499,880 5,825,877 -
Pension liability 36,931,625 - 36,931,625 -
TOTAL LIABILITIES 68,744,680 2,017,751 70,762,431 1,570,671
DEFERRED INFLOWS OF RESOURCES:
Deferred inflows from pensions 3,656,711 - 3,656,711 -
NET POSITION:
Net investment in capital assets 459,644,720 70,202,487 529,847,207 -
Restricted for:
Special projects 88,897,168 - 88,897,168 -
Capital projects 104,401,263 - 104,401,263 -
Unrestricted (deficit)78,812,066 4,479,575 83,291,641 (1,346,561)
TOTAL NET POSITION 731,755,217$ 74,682,062$ 806,437,279$ (1,346,561)$
See accompanying notes to basic financial statements.
CITY OF PALM DESERT
- 17 -
Primary Government
STATEMENT OF NET POSITION
June 30, 2016
ASSETS:
LIABILITIES:
Charges Operating Capital
for Grants and Grants and
Expenses Services Contributions Contributions
Primary Government:
Governmental activities:
General government 14,836,881$ 2,185,123$ 875,756$ 1,335,683$
Housing and redevelopment 8,162,859 7,029,595 - 6,604,303
Public safety 34,009,984 10,606,464 300,299 53,281
Parks, recreation and culture 9,223,126 772,801 2,222,173 1,070,223
Public works 47,044,197 2,186,153 6,098,292 1,776,225
Interest on long term debt 289,000 - - -
Total governmental activities 113,566,047 22,780,136 9,496,520 10,839,715
Business-type activities:
Desert Willow Golf Course 8,165,183 7,240,866 - 111,942
Office Complex - Parkview 1,005,918 1,280,230 - -
Total business-type activities 9,171,101 8,521,096 - 111,942
Total primary government 122,737,148$31,301,232$ 9,496,520$ 10,951,657$
Component Unit:
Palm Desert Recreational Facilities Corp.2,450,406$ 2,599,831$ -$ -$
General revenues:
Taxes:
Property taxes, levied for general purpose
Transient occupancy taxes
Sales taxes
Franchise taxes
Investment earnings
Gain on sale of capital assets
Miscellaneous
Transfers
Total general revenues and transfers
Change in net position, before
extraordinary gain
Extraordinary gain
Change in net position
Net position - beginning of year
Net position - end of year
See accompanying notes to basic financial statements.
CITY OF PALM DESERT
- 18 -
STATEMENT OF ACTIVITIES
For the year ended June 30, 2016
Functions/Programs
Program Revenue
Exhibit B
Component
Unit
Palm Desert
Recreational
Governmental Business-type Facilities
Activities Activities Total Corporation
(10,440,319)$ -$ (10,440,319)$ -$
5,471,039 - 5,471,039 -
(23,049,940) - (23,049,940) -
(5,157,929) - (5,157,929) -
(36,983,527) - (36,983,527) -
(289,000) - (289,000) -
(70,449,676) - (70,449,676) -
- (812,375) (812,375) -
- 274,312 274,312 -
- (538,063) (538,063) -
(70,449,676) (538,063) (70,987,739) -
- - - 149,425
11,019,927 - 11,019,927 -
11,434,671 - 11,434,671 -
19,196,680 - 19,196,680 -
3,095,873 - 3,095,873 -
2,074,934 24,924 2,099,858 -
24,292 - 24,292 -
1,828,677 - 1,828,677 -
237,500 (237,500) - -
48,912,554 (212,576) 48,699,978 -
(21,537,122) (750,639) (22,287,761) 149,425
72,138,669 - 72,138,669 -
50,601,547 (750,639) 49,850,908 149,425
681,153,670 75,432,701 756,586,371 (1,495,986)
731,755,217$ 74,682,062$ 806,437,279$ (1,346,561)$
- 19 -
Primary Government
Net (Expenses) Revenues and Changes in Net Position
-20 -
THIS PAGE INTENTIONALLY LEFT BLANK
-21 -
FUND FINANCIAL STATEMENTS
Low and
Moderate Income
Prop A Housing
General Fire Tax Asset
ASSETS:
Pooled cash and investments 70,885,455$ 2,178,877$ 16,318,056$
Receivables:
Accounts 1,762,407 - 51,003
Assessments - - -
Notes 1,451,000 - 1,200
Interest 1,597,777 - 804,395
Loans 39,806 - 6,748,785
Prepaid costs 406,024 - -
Due from other governments 6,890,716 769,563 -
Due from other funds 2,298,000 - 4,531,000
Deposits - - -
Advances to Successor Agency 9,236,000 - 14,068,138
Inventories - - -
Property held for resale - - 61,516
Due from component unit 285,000 - -
Restricted assets:
Cash and investments with fiscal agent - - 6,856,779
TOTAL ASSETS 94,852,185$ 2,948,440$ 49,440,872$
LIABILITIES:
Accounts payable 5,996,671$ 646,140$ 280,818$
Accrued liabilities 391,212 - -
Due to other funds 1,847,200 - -
Unearned revenues 18,264 - -
Deposits payable - - -
TOTAL LIABILITIES 8,253,347 646,140 280,818
DEFERRED INFLOWS OF RESOURCES:
Unavailable revenue 4,236,183 - 781,329
FUND BALANCES:
Nonspendable 9,528,630 - -
Restricted - 2,302,300 48,378,725
Committed - - -
Assigned 991,853 - -
Unassigned 71,842,172 - -
TOTAL FUND BALANCES 82,362,655 2,302,300 48,378,725
TOTAL LIABILITIES, DEFERRED INFLOWS
OF RESOURCES AND FUND BALANCES 94,852,185$ 2,948,440$ 49,440,872$
See accompanying notes to basic financial statements.
CITY OF PALM DESERT
BALANCE SHEET - GOVERNMENTAL FUNDS
June 30, 2016
Special Revenue Funds
- 22 -
RESOURCES AND FUND BALANCES
LIABILITIES, DEFERRED INFLOWS OF
Exhibit C
CFD University
Special Other Total
Housing Assessment Capital Governmental Governmental
Measure A Authority District Properties Funds Funds
19,131,717$ 15,981,730$ -$ 14,541$ 33,859,106$ 158,369,482$
- 6,098 - - 409,430 2,228,938
- - - - 1,309,422 1,309,422
- - - - - 1,452,200
- 22,482 2,455 89,487 1,953,943 4,470,539
- - - - 4,294,557 11,083,148
- - - - 3,052 409,076
1,946,386 283,618 - - 1,009,554 10,899,837
- - - - 500,000 7,329,000
15,052,983 - - - - 15,052,983
- - - - 13,419,000 36,723,138
- - - - 4,431 4,431
- - - - - 61,516
- - - - - 285,000
- 5,324,770 1,809,609 66,759,124 179,275 80,929,557
36,131,086$ 21,618,698$ 1,812,064$ 66,863,152$ 56,941,770$ 330,608,267$
697,863$ 236,545$ -$ 1,151,423$ 495,455$ 9,504,915$
- 125,763 - - 13,800 530,775
- - - - 4,981,800 6,829,000
15,052,983 14,948 - - 126,582 15,212,777
- 502,311 - - 187,109 689,420
15,750,846 879,567 - 1,151,423 5,804,746 32,766,887
1,133,769 - - - 3,262,546 9,413,827
- - - - 3,052 9,531,682
19,246,471 8,863,643 1,812,064 65,697,188 19,111,153 165,411,544
- 11,875,488 - - 4,998,346 16,873,834
- - - 14,541 23,761,927 24,768,321
- - - - - 71,842,172
19,246,471 20,739,131 1,812,064 65,711,729 47,874,478 288,427,553
36,131,086$ 21,618,698$ 1,812,064$ 66,863,152$ 56,941,770$ 330,608,267$
- 23 -
Funds (Continued)
Special Revenue
Capital Projects Funds
-24 -
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Exhibit D
Total fund balance for governmental funds 288,427,553$
Amounts reported for governmental activities in the Statement of Net Position are
different because:
When capital assets (land, buildings, equipment, etc.) that are to be used in
governmental activities are purchased or constructed, the costs of those assets
are reported as expenditures in governmental funds. However, the Statement
of Net Position includes those capital assets and contribution among the assets
of the City as a whole:
Beginning Balance, net depreciation 472,264,339$
Current year additions 7,071,738
Current year deletions (496,993)
Current year depreciation (11,633,215)
Contributions to other governmental agency (10,399,384)
Contributions of property from Successor Agency 908,289
Ending Balance, net depreciation 457,714,774
Long-term debt activities have not been included in the governmental fund
statements:
Long-term debt (3,369,332)
Interest on long-term debt is not accrued in governmental funds, but rather is
recognized as an expenditure when due.(92,171)
Because the focus of governmental funds is on short-term financing, some assets
will not be available to pay for current-period expenditures. Those assets (for
example, receivables) are offset by deferred inflows of resources in the governmental
funds and, thus, are not included in fund balance:
Palm Desert Recreational Facilities Corporation - relates to the amount of rent
owed by component unit to City's General Fund 285,000
Measure A Special Revenue Fund grants not received in available period 1,133,769
Investment income that was not paid at year-end 362,805
Sales tax 493,897
Other receivables 35,859
Successor Agency (former Redevelopment Agency) land purchase from City 2,055,000
Interest receivable that was not paid from advances to the Successor Agency 3,738,075
8,104,405
Pension related debt applicable to the City's governmental activities are not due and
payable in the current period and accordingly are not reported as fund liabilities.
Deferred outflows of resources and deferred inflows of resources related to pensions
are only reported in the Statement of Net Position as the changes in these amounts
effects only the government-wide statements for governmental activities:
Deferred outflows of resources 4,260,098
Deferred inflows of resources (3,656,711)
Pension liability (36,931,625)
(36,328,238)
Other post employment benefit asset is not available to fund current expenditures
for governmental funds and therefore is not reported as an asset in the
governmental funds.8,724,737
Internal service fund are used by management to charge the costs of certain activities,
such as equipment and compensated absences to individual funds. The assets and
liabilities of the internal service fund must be added to the Statement of Net Position.8,573,489
Net position of governmental activities 731,755,217$
See accompanying notes to basic financial statements.
CITY OF PALM DESERT
June 30, 2016
- 25 -
RECONCILIATION OF THE BALANCE SHEET OF GOVERNMENTAL FUNDS
TO THE STATEMENT OF NET POSITION
Low and
Moderate Income
Prop A Housing
General Fire Tax Asset
REVENUES:
Taxes 47,154,025$ 5,762,095$ -$
Special assessments collected - 2,114,877 -
Licenses and permits 1,366,784 - -
Intergovernmental revenues 1,991,678 996,598 -
Rental income 154,675 - -
Charges for services 1,317,540 - -
Investment earnings 725,015 12,556 169,773
Fines and forfeitures 142,645 - -
Contributions from property owners - - -
Miscellaneous 585,546 23,692 71,174
TOTAL REVENUES 53,437,908 8,909,818 240,947
EXPENDITURES:
Current:
General government 14,197,748 - -
Housing and redevelopment - - 346,727
Public safety 22,039,527 11,412,855 -
Parks, recreation and culture 4,018,383 - -
Public works 7,463,107 - -
Contributions to property owners - - -
Capital outlay 415,487 1,601 27,000
Debt service:
Principal retirement - - -
Interest and fiscal charges - - -
TOTAL EXPENDITURES 48,134,252 11,414,456 373,727
EXCESS OF REVENUES OVER
(UNDER) EXPENDITURES 5,303,656 (2,504,638) (132,780)
OTHER FINANCING SOURCES (USES):
Sale of property - - 225,000
Transfers in 1,390,258 3,000,000 -
Transfers out (4,141,928) - -
TOTAL OTHER FINANCING
SOURCES (USES)(2,751,670) 3,000,000 225,000
NET CHANGE IN FUND BALANCES,
BEFORE EXTRAORDINARY GAIN 2,551,986 495,362 92,220
EXTRAORDINARY GAIN - - 6,571,706
NET CHANGE IN FUND BALANCES 2,551,986 495,362 6,663,926
FUND BALANCES - BEGINNING OF YEAR 79,810,669 1,806,938 41,714,799
FUND BALANCES - END OF YEAR 82,362,655$ 2,302,300$ 48,378,725$
See accompanying notes to basic financial statements.
CITY OF PALM DESERT
STATEMENT OF REVENUES, EXPENDITURES AND
CHANGES IN FUND BALANCES - GOVERNMENTAL FUNDS
For the year ended June 30, 2016
Special Revenue Funds
- 26 -
Exhibit E
CFD University
Special Other Total
Housing Assessment Capital Governmental Governmental
Measure A Authority District Properties Funds Funds
2,576,443$ -$ -$ -$ 1,242,940$ 56,735,503$
- - - - 1,181,828 3,296,705
- - - - 691,059 2,057,843
4,198,770 5,422,597 - - 2,819,595 15,429,238
- 5,741,805 - - - 5,896,480
- - - - 765,303 2,082,843
110,078 74,117 39,974 130,316 575,490 1,837,319
- - - - 152,624 295,269
- - 7,868 - - 7,868
- 336 - - 1,636,751 2,317,499
6,885,291 11,238,855 47,842 130,316 9,065,590 89,956,567
- - - - 1,586,207 15,783,955
- 5,359,540 - - 732,582 6,438,849
- - - - 297,965 33,750,347
- - - - 2,813,151 6,831,534
1,934,989 - - - 1,633,488 11,031,584
- - 19,584,487 - - 19,584,487
483,829 5,120,019 - - 1,023,802 7,071,738
- - - - 257,000 257,000
- - - - 296,336 296,336
2,418,818 10,479,559 19,584,487 - 8,640,531 101,045,830
4,466,473 759,296 (19,536,645) 130,316 425,059 (11,089,263)
- - - - - 225,000
- - - - 1,640,448 6,030,706
- (733,708) - - (1,199,570) (6,075,206)
- (733,708) - - 440,878 180,500
4,466,473 25,588 (19,536,645) 130,316 865,937 (10,908,763)
- - - 65,566,963 72,138,669
4,466,473 25,588 (19,536,645) 65,697,279 865,937 61,229,906
14,779,998 20,713,543 21,348,709 14,450 47,008,541 227,197,647
19,246,471$ 20,739,131$ 1,812,064$ 65,711,729$ 47,874,478$ 288,427,553$
- 27 -
Funds (Continued)
Special Revenue
Capital Projects Funds
Exhibit F
Net change in fund balances - total governmental funds 61,229,906$
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, the costs of those assets are allocated over their
estimated useful lives as a depreciation expense. This is the amount by which
capital outlays exceeded depreciation and deletions in the current period:
Current year additions 7,071,738$
Current year deletions (496,993)
Current year depreciation (11,633,215)
Contributions to other governmental agency (10,399,384)
Contributions of property from Successor Agency 908,289
(14,549,565)
Repayment of debt principal is an expenditure in the governmental funds, but
the repayment reduces long-term liabilities in the Statement of Net Position.257,000
Some expenses reported in the Statement of Activities do not require the use of
current financial resources and, therefore, are not reported as expenditures in
governmental funds:
Net change in accrued interest for the current period 7,336
Net change in claims and judgments for the current period (24,869)
(17,533)
Unavailable revenues are not reported as revenues in governmental funds
and thus has the effect of decreasing fund balances. For the City as a whole,
however, the collection of these receipts increases the net position in the Statement
of Net Position and results in revenues in the Statement of Activities:
Grants (3,442,501)
Interest on note issued by the City 59,202
Interest on advance to Successor Agency 3,738,075
Sales tax true-up from the State 201,901
Other reimbursements 21,677
578,354
Current year change for other post employment benefit asset.231,102
Pension expense reported in the governmental funds includes the annual required
contributions. In the Statement of Activities, pension expense includes the change
in the net pension liability, and related change in pension amounts for deferred
outflows of resources and deferred inflows of resources 3,030,133
Internal service funds are used by management to charge the costs of certain activities,
such as equipment and compensated absences. The net revenues (expenses) of the
internal service funds are reported with governmental activities.(157,850)
Change in net position of governmental activities 50,601,547$
See accompanying notes to basic financial statements.
CITY OF PALM DESERT
TO THE STATEMENT OF ACTIVITIES
For the year ended June 30, 2016
- 28 -
RECONCILIATION OF THE STATEMENT OF REVENUES, EXPENDITURES AND
CHANGES IN FUND BALANCES OF GOVERNMENTAL FUNDS
Exhibit G
Major Other
Fund Fund Governmental
Desert Parkview Total Activities-
Willow Office Enterprise Internal
Golf Course Complex Funds Service Funds
ASSETS:
CURRENT ASSETS:
Cash and investments 611,974$ 3,888,959$ 4,500,933$ 9,052,648$
Receivables:
Accounts 14,681 48,042 62,723 4,560
Prepaid costs 73,168 1,649 74,817 -
Inventories 258,346 - 258,346 -
Due from component unit (PDRFC)1,170,647 - 1,170,647 -
TOTAL CURRENT ASSETS 2,128,816 3,938,650 6,067,466 9,057,208
CAPITAL ASSETS:
Nondepreciable 52,736,087 - 52,736,087 536,607
Depreciable, net 11,114,633 7,281,627 18,396,260 1,393,339
CAPITAL ASSETS, NET 63,850,720 7,281,627 71,132,347 1,929,946
TOTAL ASSETS 65,979,536 11,220,277 77,199,813 10,987,154
LIABILITIES:
CURRENT LIABILITIES:
Accounts payable 828,775 38,259 867,034 -
Accrued liabilities 75,576 - 75,576 -
Deposits payable - 25,650 25,650 -
Unearned revenues 108,271 11,360 119,631 -
Due to other funds 500,000 - 500,000 -
Compensated absences - - - 300,000
Capital leases 429,980 - 429,980 -
TOTAL CURRENT LIABILITIES 1,942,602 75,269 2,017,871 300,000
NONCURRENT LIABILITIES:
Compensated absences - - - 2,113,665
Capital leases 499,880 - 499,880 -
TOTAL NONCURRENT LIABILITIES 499,880 - 499,880 2,113,665
TOTAL LIABILITIES 2,442,482 75,269 2,517,751 2,413,665
NET POSITION:
Net investment in capital assets 62,920,860 7,281,627 70,202,487 1,929,946
Unrestricted 616,194 3,863,381 4,479,575 6,643,543
TOTAL NET POSITION 63,537,054$ 11,145,008$ 74,682,062$ 8,573,489$
See accompanying notes to basic financial statements.
CITY OF PALM DESERT
STATEMENT OF NET POSITION
PROPRIETARY FUNDS
June 30, 2016
- 29 -
Enterprise Funds
Business-type Activities-
Exhibit H
Major Other
Fund Fund Governmental
Desert Parkview Total Activities-
Willow Office Enterprise Internal
Golf Course Complex Funds Service Funds
OPERATING REVENUES:
Fees and rentals 6,163,569$ 1,269,655$ 7,433,224$ -$
Merchandise sales 1,035,711 - 1,035,711 -
Miscellaneous 41,586 10,575 52,161 32,000
TOTAL OPERATING REVENUES 7,240,866 1,280,230 8,521,096 32,000
OPERATING EXPENSES:
Maintenance and operations 4,268,730 355,539 4,624,269 2,708
Cost of merchandise 434,261 - 434,261 -
General and administrative 2,160,459 200,286 2,360,745 292,876
Depreciation and amortization 1,195,366 450,093 1,645,459 267,481
TOTAL OPERATING EXPENSES 8,058,816 1,005,918 9,064,734 563,065
OPERATING INCOME (LOSS)(817,950) 274,312 (543,638) (531,065)
NONOPERATING REVENUES (EXPENSES):
Interest revenue 459 24,465 24,924 55,232
Interest expense (106,367) - (106,367) -
Gain on sale of capital assets - - - 24,292
TOTAL NONOPERATING
REVENUES (EXPENSES)(105,908) 24,465 (81,443) 79,524
INCOME (LOSS) BEFORE
CAPITAL CONTRIBUTIONS
AND TRANSFERS (923,858) 298,777 (625,081) (451,541)
CAPITAL CONTRIBUTIONS 111,942 - 111,942 11,691
TRANSFERS IN - - - 282,000
TRANSFERS OUT - (237,500) (237,500) -
CHANGE IN NET POSITION (811,916) 61,277 (750,639) (157,850)
NET POSITION - BEGINNING OF YEAR 64,348,970 11,083,731 75,432,701 8,731,339
NET POSITION - END OF YEAR 63,537,054$ 11,145,008$ 74,682,062$ 8,573,489$
See accompanying notes to basic financial statements.
For the year ended June 30, 2016
- 30 -
CITY OF PALM DESERT
STATEMENT OF REVENUES, EXPENSES AND CHANGES IN FUND NET POSITION
PROPRIETARY FUNDS
Enterprise Funds
Business-type Activities-
Exhibit I
Major Other
Fund Fund Governmental
Desert Parkview Total Activities-
Willow Office Enterprise Internal
Golf Course Complex Funds Service Funds
CASH FLOWS FROM OPERATING ACTIVITIES:
Receipts from customers 7,231,017$ 1,325,774$ 8,556,791$ 32,000$
Payments to employees - - - (552,353)
Payments to suppliers (6,741,112) (554,356) (7,295,468) (2,708)
NET CASH PROVIDED (USED)
BY OPERATING ACTIVITIES 489,905 771,418 1,261,323 (523,061)
CASH FLOWS FROM NONCAPITAL AND
RELATED FINANCING ACTIVITIES:
Interest paid on loan (20,000) - (20,000) -
Cash received from other funds - - - 282,000
Cash paid to other funds - (237,500) (237,500) -
NET CASH PROVIDED (USED) BY
NONCAPITAL AND RELATED
FINANCING ACTIVITIES (20,000) (237,500) (257,500) 282,000
CASH FLOWS FROM CAPITAL AND
RELATED FINANCING ACTIVITIES:
Purchases of capital assets (63,624) (37,451) (101,075) (795,839)
Proceeds on sale of assets - - - 35,940
Principal paid on leases (505,186) - (505,186) -
Interest paid on leases (86,367) - (86,367) -
NET CASH USED BY CAPITAL AND
RELATED FINANCING ACTIVITIES (655,177) (37,451) (692,628) (759,899)
CASH FLOWS FROM INVESTING ACTIVITIES:
Interest and dividends 459 24,465 24,924 55,232
NET INCREASE (DECREASE) IN
CASH AND CASH EQUIVALENTS (184,813) 520,932 336,119 (945,728)
CASH AND CASH EQUIVALENTS -
BEGINNING OF YEAR 796,787 3,368,027 4,164,814 9,998,376
CASH AND CASH EQUIVALENTS -
END OF YEAR 611,974$ 3,888,959$ 4,500,933$ 9,052,648$
See accompanying notes to basic financial statements.(Continued)
CITY OF PALM DESERT
STATEMENT OF CASH FLOWS
PROPRIETARY FUNDS
For the year ended June 30, 2016
Enterprise Funds
- 31 -
Exhibit I
Major Other
Fund Fund Governmental
Desert Parkview Total Activities-
Willow Office Enterprise Internal
Golf Course Complex Funds Service Funds
RECONCILIATION OF OPERATING INCOME
(LOSS) TO NET CASH PROVIDED (USED) BY
OPERATING ACTIVITIES:
Operating income (loss)(817,950)$ 274,312$ (543,638)$ (531,065)$
Adjustments to reconcile operating
income (loss) to net cash provided
(used) by operating activities:
Depreciation and amortization 1,195,366 450,093 1,645,459 267,481
Changes in assets and liabilities:
(Increase) decrease in receivables, net 10,036 34,370 44,406 -
(Increase) decrease in prepaid costs (40,373) 387 (39,986) -
(Increase) decrease in inventories (7,780) - (7,780) -
(Increase) decrease in due
from component unit 15,323 - 15,323 -
Increase (decrease) in accounts payable
and accrued liabilities 170,491 3,582 174,073 -
Increase (decrease) in deposits payable - (2,500) (2,500) -
Increase (decrease) in unearned revenues (35,208) 11,174 (24,034) -
Increase (decrease) in compensated absences - - - (259,477)
NET CASH PROVIDED (USED)
BY OPERATING ACTIVITIES 489,905$ 771,418$ 1,261,323$ (523,061)$
NONCASH ITEMS:
See accompanying notes to basic financial statements.
- 32 -
CITY OF PALM DESERT
Noncash items include $111,942 and $11,691 (net value) of capital assets contributed by the City of Palm Desert to Desert Willow Golf Course and
Equipment Replacement Fund, respectively.
Enterprise Funds
(CONTINUED)
STATEMENT OF CASH FLOWS
PROPRIETARY FUNDS
For the year ended June 30, 2016
Business-type Activities-
Exhibit J
Successor
Agency to the
Palm Desert
Redevelopment
Agency
Private-Purpose Agency
Trust Fund Funds
ASSETS:
Cash and investments 23,833,426$ 14,820,750$
Receivables (net of allowance for uncollectibles):
Accounts 10,000 -
Assessments - 60,437,964
Interest 30,658 4,114
Due from other governments 19,445 59,982
Prepaid costs 63,220 812
Restricted assets:
Cash with fiscal agent 18,227,645 5,466,224
Capital assets, not being depreciated 35,501,118 -
Capital assets, being depreciated 961,396 -
TOTAL ASSETS 78,646,908 80,789,846$
DEFERRED OUTFLOWS OF RESOURCES:
Deferred amount on refunding 641,434
LIABILITIES:
Accounts payable 447,443 -$
Interest payable 7,315,655 -
Advances from City of Palm Desert 22,655,000 -
Advances from Housing Authority 14,068,138 -
Deposits - 80,789,846
Bonds payable - due within one year 16,255,000 -
Bonds payable - due in more than one year 272,370,381 -
TOTAL LIABILITIES 333,111,617 80,789,846$
NET POSITION:
Held in trust (253,823,275)$
See accompanying notes to basic financial statements
CITY OF PALM DESERT
- 33 -
STATEMENT OF NET POSITION
FIDUCIARY FUNDS
June 30, 2016
Exhibit K
Successor
Agency to the
Palm Desert
Redevelopment
Agency
Private-Purpose
Trust Fund
ADDITIONS:
Taxes 33,977,981$
Investment income 365,893
Other 704,145
TOTAL ADDITIONS 35,048,019
DEDUCTIONS:
Housing and development 13,041,717
Interest 17,964,693
Depreciation 279,796
Loss on disposition and transfer of property 2,641,425
TOTAL DEDUCTIONS 33,927,631
CHANGE IN NET POSITION, BEFORE
EXTRAORDINARY LOSS 1,120,388
EXTRAORDINARY LOSS (72,138,669)
CHANGE IN NET POSITION (71,018,281)
NET POSITION - BEGINNING OF YEAR (182,804,994)
NET POSITION - END OF YEAR (253,823,275)$
See accompanying notes to basic financial statements
CITY OF PALM DESERT
STATEMENT OF CHANGES IN NET POSITION
FIDUCIARY FUNDS
For the year ended June 30, 2016
- 34 -
- 35 -
CITY OF PALM DESERT
NOTES TO BASIC FINANCIAL STATEMENTS
June 30, 2016
1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES:
a. Description of the Reporting Entity:
The City of Palm Desert was originally incorporated on November 26, 1973, as a General Law
City. In December 1997, Measure LL was enacted following a vote by Palm Desert residents,
which adopted a City Charter. The City operates under a Council-Manager form of government
and provides the following services: public safety (police and fire), highways and streets,
public improvements, community development (planning, building and zoning) and general
administrative services.
The City has defined its reporting entity in accordance with accounting principles generally
accepted in the United States of America which provides guidance for determining which
governmental activities, organizations and functions should be included in the reporting entity.
The Basic Financial Statements present information on the activities of the reporting entity,
which include the City of Palm Desert (the primary government) and its component units,
entities for which the government is considered financially accountable.
Accounting principles generally accepted in the United States of America require that the
component units be separated into blended or discretely presented units for reporting purposes.
The following criteria were used in determination of blended component units: appointment of
the governing board and fiscal dependence. Although legally separate entities, blended
component units are, in substance, part of the City’s operations. Therefore, they are reported as
part of the primary government. Discretely presented component units are reported in a
separate column in the basic financial statements to emphasize that they are legally separate
from the City.
Blended Component Units
Following are descriptions of legally separate component units for which the City is financially
accountable that are blended with the Primary Government. The governing bodies of these
component units are substantially the same as the City and provides a financial benefit.
The Palm Desert Housing Authority (Housing Authority) was established by the City Council
in January 1998, and is responsible for the administration of providing affordable housing in
the City. The Housing Authority transactions are reported in the governmental funds balance
sheet as a major fund.
CITY OF PALM DESERT
NOTES TO BASIC FINANCIAL STATEMENTS
(CONTINUED)
June 30, 2016
- 36 -
1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED):
a. Description of the Reporting Entity (Continued):
Blended Component Units (Continued)
The Palm Desert Financing Authority (Financing Authority) was formed on January 26, 1989.
The purpose of the Financing Authority is to issue debt and loan the proceeds to the City and
Agency. The Financing Authority’s capital related transactions are reported in the
governmental fund financial statements in the capital projects funds, and the collection of
assessments and payments of debt service is recorded in the fiduciary funds.
The City Council of Palm Desert is the governing body for the Housing Authority and
Financing Authority.
Separate financial statements are not issued for the Housing Authority and Financing
Authority.
Discretely Presented Component Unit
The Palm Desert Recreational Facilities Corporation (Corporation) was incorporated on
February 25, 1997. The purpose of the Corporation is to lease, operate and manage a restaurant
and bar in the Desert Willow Golf Course in Palm Desert, California. The Board of Directors of
the Corporation appoints an executive director to administer operations.
The Corporation is in a separate column to emphasize that it is legally separate from the City
and is financially accountable to the City. The two-member board governing the Corporation is
appointed by the City Council, the City has authority to approve the Corporation’s budget, and
the City must approve any debt issued.
Complete financial statements of the Component Unit can be obtained from the City’s
administrative offices.
CITY OF PALM DESERT
NOTES TO BASIC FINANCIAL STATEMENTS
(CONTINUED)
June 30, 2016
- 37 -
1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED):
b. Basis of Presentation:
Government-Wide Financial Statements
The government-wide financial statements (i.e., the statement of net position and the statement
of activities) report information on all of the nonfiduciary activities of the primary government
and its component units. For the most part, the effect of interfund 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. Likewise, the primary government is
reported separately from certain legally separate component units for which the primary
government is financially accountable.
The statement of activities demonstrates the degree to which the direct and indirect expenses of
a given function or segment are offset by program revenues. Direct expenses are those that are
clearly identifiable with a specific function or segment. Program revenues include: 1) charges
to customers or applicants who purchase, use or directly benefit from goods, services or
privileges provided by a given function or segment, and 2) grants and contributions that are
restricted to meeting the operational or capital requirements of a particular function or segment.
Taxes and other items not properly included among program revenues are reported instead as
general revenues. Expenses reported for functional activities include allocated indirect
expenses.
Separate financial statements are provided for governmental funds, proprietary funds and
fiduciary funds, even though the latter are excluded from the government-wide financial
statements. Major individual governmental funds and major individual enterprise funds are
reported as separate columns in the fund financial statements.
Fund Financial Statements
The accounting system of the City is organized and operated on the basis of separate funds,
each of which is considered to be a separate accounting entity. Each fund is accounted for by
providing a separate set of self-balancing accounts that constitute its assets, liabilities, deferred
inflows of resources, fund equity, revenues and expenditures/expenses. Funds are organized
into three major categories: governmental, proprietary and fiduciary. An emphasis is placed on
major funds within the governmental and proprietary categories.
CITY OF PALM DESERT
NOTES TO BASIC FINANCIAL STATEMENTS
(CONTINUED)
June 30, 2016
- 38 -
1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED):
b. Basis of Presentation (Continued):
Fund Financial Statements (Continued)
A fund is considered major if it is the primary operation fund of the City or meets the following
criteria:
a. Total assets plus deferred outflows of resources, liabilities plus deferred inflows of
resources, revenues or expenditures/expenses of that individual governmental or enterprise
fund are at least 10% of the corresponding total for all funds of that category or type; and
b. Total assets plus deferred outflows of resources, liabilities plus deferred inflows of
resources, revenues or expenditures/expenses of the individual governmental fund or
enterprise fund are at least 5% of the corresponding total for all governmental and
enterprise funds combined.
c. The government has determined that a fund is important to the financial statement user.
The funds of the financial reporting entity are described below:
Governmental Fund Types
General Fund - The General Fund is the general operating fund of the City. It is used to account
for all financial resources except those required to be accounted for in another fund.
Special Revenue Funds - Special Revenue Funds are used to account for the proceeds of
specific revenue resources (other than major capital projects) that are legally restricted to
expenditures for specified purposes.
Debt Service Funds - Debt Service Funds are used to account for the accumulation of resources
for, and the payment of, general long-term obligation principal, interest and related costs.
Capital Projects Funds - Capital Projects Funds are used to account for financial resources to be
used for the acquisition or construction of major capital facilities.
CITY OF PALM DESERT
NOTES TO BASIC FINANCIAL STATEMENTS
(CONTINUED)
June 30, 2016
- 39 -
1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED):
b. Basis of Presentation (Continued):
Fund Financial Statements (Continued)
The funds of the financial reporting entity are described below (Continued):
Proprietary Fund Types
Enterprise Funds - The Enterprise Funds account for operations that are financed and operated
in a manner similar to private business enterprises, where the intent of the City Council is that
the costs (expenses including depreciation) of providing goods and services to the general
public on a continuing basis be financed or recovered primarily through user charges.
The Primary Government’s Enterprise funds consist of the Parkview Office Complex and the
Desert Willow Golf Course. Desert Willow Golf Course is operated by a management
company. The Discrete Component Unit’s Enterprise fund consists of the Palm Desert
Recreational Facilities Corporation, also operated by a management company.
Internal Service Funds - The Internal Service Funds account for financial transactions related to
replacement of City-owned vehicles and equipment and to fund compensated absences. These
services are provided to other departments or agencies of the City on a cost reimbursement
basis.
Fiduciary Fund Types
Private-Purpose Trust Fund
The Successor Agency to the Palm Desert Redevelopment Agency Private Purpose Trust Fund
is used to account for the activities of the Successor Agency to the Palm Desert Redevelopment
Agency.
Agency Funds
The Agency, Special Assessment and Treasurers 1911 Bond Act Funds are used to account for
assets held by the City in a custodial capacity as a trustee or as an agent. These assets include
deposits placed with the City by developers, individuals and groups to obtain future services, as
well as deposits from assessment district’s property owners. These deposits are reduced by
payments and/or refunds to individuals or entities at some future time. Agency funds are
custodial in nature and do not involve measurement of results of operations.
The City’s Retiree Service Stipend Fund is used to account for assets held to pay for the retiree
service stipend.
CITY OF PALM DESERT
NOTES TO BASIC FINANCIAL STATEMENTS
(CONTINUED)
June 30, 2016
- 40 -
1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED):
b. Basis of Presentation (Continued):
Fund Financial Statements (Continued)
The major funds are as follows:
Governmental Funds
The General Fund is the general operating fund of the City. It is used to account for all
financial resources except those required to be accounted for in another fund.
The Prop A Fire Tax Special Revenue Fund is used to account for all revenues derived from tax
collected within the City for upgrading fire protection and prevention. Its use is restricted to
obtaining, furnishing, operating and maintaining fire protection and prevention services
(currently under contract with Riverside County Fire Department) equipment or apparatus. This
fund is reported as a major fund because the tax collected is a voter approved measure.
The Low and Moderate Income Housing Asset Special Revenue Fund is used to account for
any funds generated from housing assets of the former Redevelopment Agency to be used for
projects that benefit low and moderate income families.
The Measure A Special Revenue Fund - In 1988, Riverside County voters approved a half-cent
sales tax, known as Measure A, to fund a variety of highway improvements, local street and
road maintenance, commuter assistance and specialized transit projects. This fund is used to
collect this tax, and pursuant to the provision of Measure A (Ordinance No. 88-1 and
Ordinance No. 02-001 of the County of Riverside) it is restricted for local street and road
expenditures only.
The Housing Authority Special Revenue Fund is used to account for revenues and expenditures
related to rental units owned by the Housing Authority, established in January, 1998.
The CFD University Special Assessment District Capital Projects Fund is used to account for
the construction of public improvements from proceeds resulting from the creation of the CFD
University Assessment District.
The Capital Properties Capital Projects Fund is used to account for the cost of city owned
properties that will either be sold or for the construction of public facilities, and the proceeds of
bond funds for capital related properties.
Proprietary Fund
The Desert Willow Golf Course Fund is used to account for the fees collected and expenses
incurred in connection with operating the municipal golf course in the City of Palm Desert.
CITY OF PALM DESERT
NOTES TO BASIC FINANCIAL STATEMENTS
(CONTINUED)
June 30, 2016
- 41 -
1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED):
c. Measurement Focus and Basis of Accounting:
Measurement focus is a term used to describe which transactions are recorded within the
various financial statements. Basis of accounting refers to when transactions are recorded
regardless of the measurement focus applied.
Measurement Focus
On the government-wide Statement of Net Position and the Statement of Activities, both
governmental and business-like activities are presented using the economic resources
measurement focus. The accounting objectives of the economic measurement focus are the
determination of operating income, changes in net position (or cost recovery), financial
position and cash flows. All assets, deferred outflows of resources, liabilities and deferred
inflows of resources (whether current or noncurrent) associated with their activities are
reported.
In the fund financial statements, the “current financial resources” measurement focus or the
“economic resources” measurement focus is used as appropriate:
1. All governmental funds utilize a “current financial resources” measurement focus. Only
current financial assets, deferred outflows of resources, current liabilities and deferred
inflows of resources are generally included on their balance sheets. Their operating
statements present sources and uses of available spendable financial resources during a
given period. These funds use fund balance as their measure of available spendable
financial resources at the end of the period.
2. The proprietary fund and private purpose trust fund utilize an “economic resources”
measurement focus. Proprietary fund and private purpose trust fund equity are classified as
net position.
3. Agency funds are not involved in the measurement of results of operations; therefore,
measurement focus is not applicable to them.
CITY OF PALM DESERT
NOTES TO BASIC FINANCIAL STATEMENTS
(CONTINUED)
June 30, 2016
- 42 -
1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED):
c. Measurement Focus and Basis of Accounting (Continued):
Basis of Accounting
In the government-wide Statement of Net Position and Statement of Activities, both
governmental and business-like activities are presented using the accrual basis of accounting.
Under the accrual basis of accounting, revenues are recognized when earned and expenses are
recorded when the liability is incurred or economic asset used. Revenues, expenses, gains,
losses, assets and liabilities resulting from exchange and exchange-like transactions are
recognized when the exchange takes place.
In the fund financial statements, governmental funds are presented on the modified accrual
basis of accounting. Under this modified accrual basis of accounting, revenues are recognized
when “measurable and available”. Measurable means knowing or being able to reasonably
estimate the amount. Available means collectible within the current period or soon enough
thereafter to pay current liabilities.
Revenues that are susceptible to accrual include property taxes and special assessments that are
levied for and due for the fiscal year and collected within 60 days after year-end. Licenses,
permits, fines, forfeits, charges for services and miscellaneous revenues are recorded as
governmental fund type revenues when received in cash because they are not generally
measurable until actually received. Revenue from taxpayer assessed taxes, such as sales taxes,
are recognized in the accounting period in which they became both measurable and available to
pay liabilities of the current period. Grants and similar items are recognized as soon as all
eligibility requirements imposed by the provider have been met. 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.
Interfund activity has been eliminated from the general government function for the
government-wide financial statements except for charges between the government’s Desert
Willow Golf Course and Parkview Office Complex funds and various other functions of the
government. Elimination of these charges would distort the direct costs and program revenues
for the various functions considered.
The accrual basis of accounting is followed by the proprietary fund and private purpose trust
fund. Under the accrual basis of accounting, revenues are recognized when earned and
expenses are recorded when the liability is incurred or economic assets are used.
CITY OF PALM DESERT
NOTES TO BASIC FINANCIAL STATEMENTS
(CONTINUED)
June 30, 2016
- 43 -
1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED):
c. Measurement Focus and Basis of Accounting (Continued):
Basis of Accounting (Continued)
Proprietary funds distinguish operating revenues and expenses from nonoperating items.
Operating revenues and expenses generally result from providing goods and services in
connection with a proprietary fund’s principal ongoing operations. The principal revenue of the
Desert Willow Golf Course and Parkview Office Complex Enterprise Funds are charges to
customers for use of the golf course and rental fees. Operating expenses for enterprise funds
include the cost of sales and services, administrative expenses and depreciation on capital
assets. All revenues and expenses not meeting this definition are reported as nonoperating
revenues and expenses.
d. New Accounting Pronouncements:
Current Year Standards
In fiscal year 2015-2016, the City implemented Governmental Accounting Standards Board
(GASB) Statement No. 72, “Fair Value Measurement and Application”. GASB Statement
No. 72 requires the City to use valuation techniques which are appropriate under the
circumstances and are either a market approach, a cost approach or income approach. GASB
Statement No. 72 establishes a hierarchy of inputs used to measure fair value consisting of
three levels. Level 1 inputs are quoted prices in active markets for identical assets or liabilities.
Level 2 inputs are inputs, other than quoted prices included within Level 1, which are
observable for the asset or liability, either directly or indirectly. Level 3 inputs are
unobservable inputs, and typically reflect management’s estimates of assumptions that market
participants would use in pricing the asset or liability. GASB Statement No. 72 also contains
note disclosure requirements regarding the hierarchy of valuation inputs and valuation
techniques that were used for the fair value measurements. There was no material impact on
the City’s financial statements as a result of the implementation of GASB Statement No. 72.
GASB Statement No. 73, “Accounting and Financial Reporting for Pensions and Related
Assets That Are Not within the Scope of GASB Statement 68, and Amendments to Certain
Provisions of GASB Statements 67 and 68”, was required to be implemented in the current
fiscal year, except for those provisions that address employer and governmental nonemployer
contributing entities for pensions that are not within the scope of GASB Statement No. 68, and
is effective for periods beginning after June 15, 2016, and did not impact the City.
CITY OF PALM DESERT
NOTES TO BASIC FINANCIAL STATEMENTS
(CONTINUED)
June 30, 2016
- 44 -
1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED):
d. New Accounting Pronouncements (Continued):
Current Year Standards (Continued)
GASB Statement No. 76, “The Hierarchy of Generally Accepted Accounting Principles for
State and Local Governments”, was required to be implemented in the current fiscal year, and
did not impact the City.
GASB Statement No. 79, “Certain External Investment Pools and Pool Participants”, was
required to be implemented in the current fiscal year, except for certain provisions on portfolio
quality, custodial credit risk, and shadow pricing, which are effective for periods beginning
after December 15, 2015, and did not impact the City.
GASB Statement No. 82, “Pension Issues an Amendment of GASB Statement No. 67, No. 68
and No. 73”, changed the measurement of covered payroll reported in required supplementary
information and has been early implemented.
Pending Accounting Standards
GASB has issued the following statements, which may impact the City’s financial reporting
requirements in the future:
GASB 73 - “Accounting and Financial Reporting for Pensions and Related Assets That
Are Not within the Scope of GASB Statement 68, and Amendments to Certain Provisions of
GASB Statements 67 and 68”, contains provisions that address employer and governmental
nonemployer contributing entities for pensions that are not within the scope of GASB 68,
effective for periods beginning after June 15, 2016.
GASB 74 - “Financial Reporting for Postemployment Benefit Plans Other Than Pension
Plans”, effective for periods beginning after June 15, 2016.
GASB 75 - “Accounting and Financial Reporting for Postemployment Benefits Other Than
Pensions”, effective for periods beginning after June 15, 2017.
GASB 77 - “Tax Abatement Disclosure”, effective for periods beginning after
December 15, 2015.
GASB 78 - “Pensions Provided through Certain Multiple-Employer Defined Benefit
Pension Plans”, effective for periods beginning after December 15, 2015.
CITY OF PALM DESERT
NOTES TO BASIC FINANCIAL STATEMENTS
(CONTINUED)
June 30, 2016
- 45 -
1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED):
d. New Accounting Pronouncements (Continued):
Pending Accounting Standards (Continued)
GASB 79 - “Certain External Investment Pools and Pool Participants”, contains certain
provisions on portfolio quality, custodial credit risk, and shadow pricing, effective for
periods beginning after December 15, 2015.
GASB 80 - “Blending Requirements for Certain Component Units”, effective for periods
beginning after June 15, 2016.
GASB 81 - “Irrevocable Split-Interest Agreements”, effective for periods beginning after
December 15, 2016.
GASB 82 - “Pension Issues”, effective for periods beginning after June 15, 2016, except
for certain provisions on selection of assumptions, which are effective in the first reporting
period in which the measurement date of the pension liability is on or after June 15, 2017.
e. Deferred Outflows/Inflows of Resources:
In addition to assets, the statement of net position and the governmental funds balance sheet
will sometimes report 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 future periods and so will not be recognized as an outflow of resources
(expense/expenditure) until that time. The City has the following items that qualify for
reporting in this category:
Deferred amount on refunding. A deferred amount on refunding results from the
difference in the carrying value of the refunded debt and its reacquisition price. This
amount is deferred and amortized over the shorter of the life of the refunded or
refunding debt.
Deferred outflows related to pensions. This amount is equal to employer contributions
made after the measurement date of the net pension liability.
CITY OF PALM DESERT
NOTES TO BASIC FINANCIAL STATEMENTS
(CONTINUED)
June 30, 2016
- 46 -
1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED):
e. Deferred Outflows/Inflows of Resources (Continued):
In addition to liabilities, the statement of net position and the governmental funds balance sheet
will sometimes report 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 future periods and will not be recognized as an inflow of resources
(revenue) until that time. The City has the following items that qualify for reporting in this
category:
Deferred inflows from unavailable revenue, which arises under a modified accrual
basis of accounting is reported only in the governmental fund balance sheet. The
governmental funds report unavailable revenues from the following sources: sales
taxes, investment income, grants, notes receivables collections and capital
reimbursements from developers. These amounts are unavailable and recognized as an
inflow of resources in the period that the amounts become available.
Deferred inflows related to pensions for differences between expected and actual
experience. These amounts are amortized over a closed period equal to the average of
the expected remaining service lives of all employees that are provided with pensions
through the plan, which is 3.2 years.
Deferred inflows from pensions resulting from changes in assumptions. These amounts
are amortized over a closed period equal to the average expected remaining service
lives of all employees that are provided with pensions through the plan, which is 3.2
years.
Deferred inflows related to pensions resulting from the difference in projected and
actual earnings on investments of the pension plan fiduciary net position. These
amounts are amortized over five years.
f. Net Position Flow Assumption:
Sometimes the City will fund outlays for a particular purpose from both restricted
(e.g., restricted bond or grant proceeds) and unrestricted resources. In order to calculate the
amounts to report as restricted - net position and unrestricted - net position, a flow assumption
must be made about the order in which the resources are considered to be applied.
It is the City’s practice to consider restricted - net position to have been depleted before
unrestricted - net position is applied.
CITY OF PALM DESERT
NOTES TO BASIC FINANCIAL STATEMENTS
(CONTINUED)
June 30, 2016
- 47 -
1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED):
g. Capital Assets and Depreciation:
Capital assets, which include property, plant, equipment and infrastructure assets (e.g., roads,
traffic signals, drainage systems and similar items), are reported in the applicable governmental
or business-type activities column in the government-wide financial statements. Capital assets
are defined by the City as assets with an initial cost of more than $500 and an estimated life in
excess of one year. Such assets are recorded at historical cost or estimated historical cost if
purchased or constructed. Donated capital assets are recorded at acquisition value at the date of
donation.
The City has reported general infrastructure assets acquired in prior and current years.
The cost of normal maintenance and repairs that do not add to the value of the asset or
materially extend asset lives are not capitalized.
Property, plant and equipment of the primary government, as well as the component units, are
depreciated using the straight-line method over the following estimated useful lives:
Buildings 40 years
Improvements other than buildings 20 years
Machinery and equipment 5 to 8 years
Infrastructure 20 to 75 years
h. Appropriations Limit:
Under Article XIII-B of the California Constitution (the Gann Spending Limitation Initiative),
the City is restricted as to the amount of annual appropriations from the proceeds of taxes, and
if proceeds of taxes exceed allowed appropriations, the excess must either be refunded to the
State Controller or returned to the taxpayers through revised tax rates, revised fee schedules or
other refund arrangements. For the fiscal year ended June 30, 2016, proceeds of taxes did not
exceed appropriations.
i. Investments:
Investments are reported in the accompanying financial statements at fair value. Fair value is
the price that would be received to sell an asset or paid to transfer a liability in an orderly
transaction between market participants at the measurement date. Changes in fair value that
occur during a fiscal year are recognized as investment income reported for that fiscal year.
Investment income includes interest earnings, changes in fair value, and any gains or losses
realized upon the liquidation, maturity, or sale of investments.
CITY OF PALM DESERT
NOTES TO BASIC FINANCIAL STATEMENTS
(CONTINUED)
June 30, 2016
- 48 -
1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED):
j. Cash and Investments:
For purposes of the statement of cash flows, the City has defined cash and investments to
include cash on hand, demand deposits, investments held in various instruments, and
investments held in the California Local Agency Investment Fund (LAIF), California Asset
Management Program (CAMP) and Riverside County Treasurer’s Pooled Investment Fund.
k. Employee Compensated Absences:
It is the government’s policy to permit employees to accumulate earned but unused vacation
and sick leave (compensated absences). Vacation pay and sick leave, which are expected to be
liquidated with expendable available resources, are reported as expenditure and liability of the
governmental fund that will pay it only if they have matured, for example, as a result of
employee resignations or retirements. Compensated absences in the amount of $2,413,665, are
reported in the Compensation Benefits Internal Service Fund.
l. Property Held for Resale:
The land held for resale is recorded in the Low and Moderate Income Housing Asset Special
Revenue Fund as property held for resale at the lower of acquisition cost or net realizable
value. At June 30, 2016, the cost of the property held for resale for various housing properties
in Palm Desert totaled $61,516.
m. Inventories, Prepaid Costs and Deposits:
Inventory in the amount of $258,346 and $41,190, for the Desert Willow Golf Course
Enterprise Fund (Primary Government) and Palm Desert Recreational Facilities Corporation
(Component Unit), respectively, are stated at lower of cost or market with cost determined
using the weighted average cost method. Inventory in the amount of $4,431 in the Other
Governmental Funds are stated at cost. Inventory and prepaid costs are recorded as an
expenditure when consumed rather than purchased.
Certain payments to vendors that reflect costs applicable to future accounting periods are
recorded as prepaid costs in the government-wide and fund financial statements.
The Measure A Special Revenue Fund has a deposit in the amount of $15,052,983 with another
governmental agency to pay for future construction of a City project.
CITY OF PALM DESERT
NOTES TO BASIC FINANCIAL STATEMENTS
(CONTINUED)
June 30, 2016
- 49 -
1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED):
n. Property Tax Calendar:
Property taxes are assessed and collected each fiscal year according to the following property
tax calendar:
Lien date: January 1
Levy date: July 1 to June 30
Due date: November 1 - 1st Installment
March 1 - 2nd Installment
Delinquent date: December 10 - 1st Installment
April 10 - 2nd Installment
Under California law, property taxes are assessed and collected by the counties up to 1% of
assessed value, plus other increases approved by the voters. The property taxes go into a pool
and are then allocated to the cities based on complex formulas prescribed by state statutes. The
City accrues only those taxes, which are received within 60 days after the year-end. The City is
a participant in the Teeter Plan under the California Revenue and Taxation Code. The County
of Riverside has responsibility for the collection of delinquent taxes and the City receives
100% of the levy.
o. Restricted Assets:
Certain proceeds of debt issues, as well as certain resources set aside for their repayment, are
classified as restricted assets on the balance sheet because they are maintained in separate
trustee bank accounts and their use is limited to applicable bond covenants. In addition, funds
have been restricted for future capital improvements by City resolution.
p. Pensions:
For purposes of measuring the net pension liability and deferred outflows/inflows of resources
related to pensions, and pension expense, information about the fiduciary net position of the
District’s California Public Employees’ Retirement System (CalPERS) plans (Plans) and
additions to/deductions from the Plans’ fiduciary net position have been determined on the
same basis as they are reported by CalPERS. 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.
CITY OF PALM DESERT
NOTES TO BASIC FINANCIAL STATEMENTS
(CONTINUED)
June 30, 2016
- 50 -
1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED):
q. Use of Estimates:
The financial statements are prepared in accordance with accounting principles generally
accepted in the United States of America and, accordingly, include amounts that are based on
management’s best estimates and judgments. The financial statements include estimates for
the value of the capital assets (infrastructure), depreciation expense, the fair value of
investments, the amounts reported for the pension liability and related items (Note 8), the
actuarial accrued liability for the other post-employment benefits (Note 12), and claims
payable (Note 6). Accordingly, actual results could differ from the estimates.
2. CASH AND INVESTMENTS:
Cash and Investments
As of June 30, 2016, cash and investments were reported in the accompanying financial statements
as follows:
Governmental activities $ 248,351,687
Business-type activities 4,500,933
Component unit 157,958
Fiduciary funds 62,348,045
Total Cash and Investments $ 315,358,623
Cash and investments at June 30, 2016, consisted of the following:
Primary Government
Demand accounts $ (3,845,516)
Petty cash 21,800
Investments 256,676,336
Total Cash and Investments - Primary Government $ 252,852,620
Component Unit
Demand accounts $ 157,958
Fiduciary Funds
Demand accounts $ 661,327
Pooled with primary government 14,820,750
Investments 46,865,968
Total Cash and Investments - Fiduciary Funds $ 62,348,045
CITY OF PALM DESERT
NOTES TO BASIC FINANCIAL STATEMENTS
(CONTINUED)
June 30, 2016
- 51 -
2. CASH AND INVESTMENTS (CONTINUED):
Cash and Investments (Continued)
The City of Palm Desert maintains a cash and investment pool that is available for use for all
funds. Each fund type’s position in the pool is reported on the combined balance sheet as cash and
investments. The City has adopted an investment policy, which authorizes it to invest in various
investments.
Deposits
At June 30, 2016, the carrying amount of the deposits was $11,794,519, and the bank balance was
$12,301,476. The $506,957 difference represents outstanding checks, deposits in transit and other
reconciling items.
The California Government Code requires California banks and savings and loan associations to
secure an Entity’s deposits by pledging government securities with a value of 110% of an Entity’s
deposits. California law also allows financial institutions to secure deposits by pledging first trust
deed mortgage notes having a value of 150% of total deposits. The City Treasurer may waive the
collateral requirement for deposits that are fully insured up to $250,000 by the FDIC. The
collateral for deposits in federal and state chartered banks is held in safekeeping by an authorized
Agent of Depository recognized by the State of California Department of Banking. The collateral
for deposits with savings and loan associations is generally held in safekeeping by the Federal
Home Loan Bank in San Francisco, California as an Agent of Depository. These securities are
physically held in an undivided pool for all California public agency depositors.
Under Government Code Section 53655, the placement of securities by a bank or savings and loan
association with an Agent of Depository has the effect of perfecting the security interest in the
name of the local governmental agency. Accordingly, all collateral held by California Agents of
Depository are considered to be held for, and in the name of, the local governmental agency.
CITY OF PALM DESERT
NOTES TO BASIC FINANCIAL STATEMENTS
(CONTINUED)
June 30, 2016
- 52 -
2. CASH AND INVESTMENTS (CONTINUED):
Investments
Under provision of the City’s investment policy and in accordance with the California Government
Code, the following investments are authorized:
United States Treasury bills, notes, bonds or certificates of indebtedness
United States government-sponsored agency obligations, participations or other instruments
Banker’s Acceptances issued by commercial banks
Commercial Paper issued by general corporations
Negotiable Certificates of Deposits, issued by a nationally or state-chartered bank, a savings
association, a federal association or by a state-licensed branch of a foreign bank
Time Certificates of Deposit issued by qualified public depositories.
Repurchase Agreements sold by authorized brokers
Medium-term Notes issued by corporations organized and operating in the United States, or by
depository institutions operating in the United States and licensed by the United States or by
any state
Money Market Mutual Funds that are registered with the SEC under the Investment Act
of 1940
State of California Local Agency Investment Fund (LAIF) that is managed by the State
Treasurer’s Office
Structured Notes in the form of callable securities or “STRIPS” issued by the United States
Treasury, Federal Agencies or government-sponsored enterprises
Local Government Investment Pools
GASB Statement No. 31
The City adopted GASB Statement No. 31, Accounting and Financial Reporting for Certain
Investments and for External Investment Pools, as of July 1, 1997. GASB Statement No. 31
establishes fair value standards for investments in participating interest earning investment
contracts, external investment pools, equity securities, option contracts, stock warrants and stock
rights that have readily determinable fair values.
CITY OF PALM DESERT
NOTES TO BASIC FINANCIAL STATEMENTS
(CONTINUED)
June 30, 2016
- 53 -
2. CASH AND INVESTMENTS (CONTINUED):
Credit Risk
The City Treasurer is authorized under state and municipal law to invest in various types of
securities that meet specified credit quality standards, based upon credit risk ratings assigned by
Standard and Poors (S&P), Fitch, or by Moody’s Investor Services (Moody’s). Permissible City
investments include medium-term notes that are rated “A” or higher at time of purchase;
commercial paper that is rated “A-1” or the equivalent; money market mutual funds that are rated
“AAA”; and United States Government and Federal Agency securities (the quality of United States
Treasury securities is not analyzed since they are not deemed to have credit risk).
Generally, credit risk is the risk that an issuer of an investment will not fulfill its obligation to the
holder of the investment. This is measured by the assignment of a rating by a nationally
recognized statistical rating organization. Presented below is the minimum rating required, when
applicable, by the California Government Code, the City’s investment policy, or debt agreements,
and the rating by Standard and Poor’s, Fitch and Moody’s as of year-end for each investment type.
Primary Government
Minimum
Total as of Legal
Investment Type June 30, 2016 Rating AAAm A Other Unrated
California Local Agency
Investment Fund 32,643,833$ N/A -$ -$ -$ 32,643,833$
California Asset
Management Program 152,421 N/A 152,421 - - -
Riverside County Treasurer's
Pooled Investment Fund 97,235,687 N/A - - 97,235,687 -
US. Govenrment Sponsored
Agency Securities 12,020,443 N/A - - 12,020,443 -
Medium-Term Corporate Notes 25,034,615 A - 9,445,312 15,589,303 -
Commercial Paper 13,984,550 A1/P1 - - 13,984,550 -
Held by Fiscal Agent:
Money Market Mutual Funds 1,327,521 AAA/Aaa - - 1,327,521 -
California Local Agency
Investment Fund 74,277,266 N/A - - - 74,277,266
Total 256,676,336$ 152,421$ 9,445,312$ 140,157,504$ 106,921,099$
The ratings for the “Other” category above are as follows:
Investment Type AA- AA AAA AA+/Aaa- A1+/P1 A1/P1 Aaa Total
Riverside County Treasurer’s Pooled
Investment Fund $ - $ - $ $ $ $ $ 97,235,687 $ 97,235,687
U.S Government Sponsored Agency
Securities - - - 12,020,443 - - - 12,020,443
Medium-Term Corporate Notes 12,839,533 1,250,804 1,498,966 - - - - 15,589,303
Commercial Paper - - - - 1,996,520 11,988,030 - 13,984,550
Held by Fiscal Agent:
Money Market Mutual Fund - - 1,327,521 - - - - 1,327,521
$ 12,839,533 $ 1,250,804 $ 2,826,487 $ 12,020,443 $ 1,996,520 $ 11,988,030 $ 97,235,687 $ 140,157,504
CITY OF PALM DESERT
NOTES TO BASIC FINANCIAL STATEMENTS
(CONTINUED)
June 30, 2016
- 54 -
2. CASH AND INVESTMENTS (CONTINUED):
Credit Risk (Continued)
Fiduciary Funds
Minimum
Total as of Legal
Investment Type June 30, 2016 Rating AAAm Aaa AAA Unrated
California Asset
Management Program 5,547,000$ N/A 5,547,000$ -$ -$ -$
Riverside County Treasurer's
Pooled Investment Fund 16,031,098 N/A - 16,031,098 - -
Investment in City Bonds -
Successor Agency RDA 1,594,000 N/A - - - 1,594,000
Held by Fiscal Agent:
Money Market Mutual Funds -
Successor Agency RDA 16,529,003 AAA - - 16,529,003 -
California Local Agency
Investment Fund -
Successor Agency RDA 1,698,643 N/A - - - 1,698,643
Money Market Mutual Funds -
Assessment District 2,951,237 AAA - - 2,951,237 -
California Local Agency
Investment Fund -
Assessment District 2,514,987 N/A - - - 2,514,987
Total 46,865,968$ 5,547,000$ 16,031,098$ 19,480,240$ 5,807,630$
Custodial Credit Risk
The 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 deposits or will not be able to recover
collateral securities that are in the possession of an outside party. The custodial credit risk for the
investments is the risk that, in the event of the failure of the counterparty to a transaction, a
government will not be able to recover the value of investment or collateral securities that are in
the possession of an outside party.
As of June 30, 2016, none of the City’s deposits or investments were exposed to custodial credit
risk.
CITY OF PALM DESERT
NOTES TO BASIC FINANCIAL STATEMENTS
(CONTINUED)
June 30, 2016
- 55 -
2. CASH AND INVESTMENTS (CONTINUED):
Concentration of Credit Risk
The City’s investment policy imposes restrictions on the percentage the City can invest in certain
types of investments, which the City is in compliance. As of June 30, 2016, in accordance with
GASB Statement no. 40, if the City has invested more than 5% of its total investments in any one
issuer then they are exposed to concentration of credit risk. The City is not invested in any one
issuer that is more than 5% of its total investments.
The City’s Investment policy imposes the following restrictions on the maximum percentage it can
invest in a single type of investment.
Portfolio Single Issuer
Issuer Maximum Maximum
United States Treasury Bills, Notes, Bonds 100% N/A
United States Government-Sponsored
Agency Securities 100% 30%
Banker’s Acceptances 40% 30%
Commercial Paper 25% 10%
Negotiable Certificates of Deposit 30% N/A
Time Certificates of Deposit 15% N/A
Repurchase Agreements 20% N/A
Medium-Term Corporate Notes 30% 5%
Money Market Mutual Funds 20% N/A
Local Agency Investment Fund (LAIF) $50M/Acct N/A
Structured Notes (STRIPS) 20% N/A
Local Government Investment Pools 50% N/A
N/A - Not Applicable
The City’s policy is more conservative than state law, which has no issuer concentration limits on
federal agency debt.
Interest Rate Risk
The City’s investment policy limits investment maturities as a means of managing its exposure to
fair value losses arising from increasing interest rates. The City’s investment policy states that the
City shall not invest in securities with maturities exceeding five years and the weighted-average
maturity of the City portfolio shall not exceed 540 days. The City has elected to use the segmented
time distribution method of disclosure for its interest rate risk.
CITY OF PALM DESERT
NOTES TO BASIC FINANCIAL STATEMENTS
(CONTINUED)
June 30, 2016
- 56 -
2. CASH AND INVESTMENTS (CONTINUED):
Interest Rate Risk (Continued)
As of June 30, 2016, the City had the following investments and maturities:
Primary Government
Less Than 6 months - 1 year - Over Fair
Investment Type 6 months 1 year 3 years 3 years Value
California Local Agency
Investment Fund 32,643,833$ -$ -$ -$ 32,643,833$
California Asset
Management Program 152,421 - - - 152,421
Riverside County Treasurer's
Pooled Investment Fund 97,235,687 - - - 97,235,687
U.S. Government Sponsored
Agency Securities - 3,002,337 9,018,106 12,020,443
Medium-Term Corporate Notes 2,924,824 4,254,873 17,854,918 25,034,615
Commercial Paper 13,984,550 - - - 13,984,550
Held by Fiscal Agent:
Money Market Mutual Funds 1,327,521 - - - 1,327,521
California Local Agency
Investment Fund 74,277,266 - - - 74,277,266
Total 222,546,102$ 7,257,210$ 26,873,024$ -$ 256,676,336$
Fiduciary Funds
Less Than 6 months - 1 year - Over Fair
Investment Type 6 months 1 year 3 years 3 years Value
California Asset
Management Program 5,547,000$ -$ -$ -$ 5,547,000$
Riverside County Treasurer's
Pooled Investment Fund 16,031,098 - - - 16,031,098
Investment in City Bonds -
Successor Agency RDA 116,000 - 341,000 1,137,000 1,594,000
Held by Fiscal Agent:
Money Market Mutual Funds -
Successor Agency RDA 16,529,003 - - - 16,529,003
LAIF - Successor Agency RDA 1,698,643 - - - 1,698,643
Money Market Mutual Funds -
Assessment District 2,951,237 - - - 2,951,237
LAIF - Assessment District 2,514,987 - - - 2,514,987
Total 45,387,968$ -$ 341,000$ 1,137,000$ 46,865,968$
CITY OF PALM DESERT
NOTES TO BASIC FINANCIAL STATEMENTS
(CONTINUED)
June 30, 2016
- 57 -
2. CASH AND INVESTMENTS (CONTINUED):
Investment in State Investment Pool
The City is a voluntary participant in the Local Agency Investment Fund (LAIF) that is regulated
by California Government Code Section 16429 under the oversight of the Treasurer of the State of
California. The fair value of the City’s investment in this pool is reported in the accompanying
financial statements at amounts based upon the City’s pro-rata share of the fair value provided by
LAIF for the entire LAIF portfolio (in relation to the amortized cost of that portfolio). The balance
available for withdrawal is based on the accounting records maintained by LAIF, which are
recorded on an amortized cost basis.
Investment in California Asset Management Program
The California Asset Management Program (CAMP) is a public joint powers authority which
provides California Public Agencies with investment management services for surplus funds and
comprehensive investment management, accounting and arbitrage rebate calculation services for
proceeds of tax-exempt financings. The CAMP currently offers the Cash Reserve Portfolio, a
short-term investment portfolio, as a means for Public Agencies to invest these funds. Public
Agencies that invest in the Pool (Participants) purchase shares of beneficial interest. Participants
may also establish individual, professionally managed investment accounts (Individual Portfolios)
by separate agreement with the Investment Advisor.
Investments in the Pools and Individual Portfolios are made only in investments in which Public
Agencies generally are permitted by California statute. The CAMP may reject any investment and
may limit the size of a Participant’s account. The Pool seeks to maintain, but does not guarantee, a
constant net asset value of $1.00 per share. A Participant may withdraw funds from its Pool
accounts at any time by check or wire transfers. Requests for same-day wire transfers must be
made by 11:00 a.m. that day. Fair value of the Pool is determined by the fair value per share of the
Pool’s underlying portfolio.
Investment in Riverside County Treasurer’s Pooled Investment Fund
The City is a voluntary participant in the Riverside County Treasurer’s Pooled Investment Fund
(Pooled Fund). The fair value of the City’s investment in this pool is reported in the accompanying
financial statements at amounts based upon the City’s pro-rata share of the fair value that the
Riverside County Treasurer’s Office has provided for the entire Pooled Fund (in relation to the
amortized cost of that portfolio). The balance available for withdrawal is based upon the
accounting records that the Riverside County Treasurer’s Office maintains, which are recorded on
an amortized cost basis.
CITY OF PALM DESERT
NOTES TO BASIC FINANCIAL STATEMENTS
(CONTINUED)
June 30, 2016
- 58 -
2. CASH AND INVESTMENTS (CONTINUED):
Fair Value Measurements
The City categorizes its fair value measurement within the fair value hierarchy established by
generally accepted accounting principles. The hierarchy is based on the relative inputs used to
measure the fair value of the investments. The hierarchy gives the highest priority to unadjusted
quoted prices in active markets for identical assets (Level 1 measurements) and the lowest priority
to unobservable inputs (Level 3 measurements).
The three levels of the fair value hierarchy are described as follows:
Level 1: Inputs to the valuation methodology are unadjusted quoted prices for identical
assets in active markets that the City has the ability to access.
Level 2: Inputs to the valuation methodology include:
Quoted prices for similar assets in active markets;
Quoted prices for identical or similar assets in inactive markets;
Inputs other than quoted prices that are observable for the asset;
Inputs that are derived principally from or corroborated by observable
market data by correlation or other means.
Level 3: Inputs to the valuation methodology are unobservable and significant to the fair
value measurement. Unobservable inputs reflect the City’s own assumptions
about the inputs market participants would use in pricing the asset (including
assumptions about risk). Unobservable inputs are developed based on the best
information available in the circumstances and may include the City’s own data.
The asset’s level within the hierarchy is based on the lowest level of input that is significant to the
fair value measurement. Valuation techniques used need to maximize the use of observable inputs
and minimize the use of unobservable inputs.
The determination of what constitutes observable requires judgment by the City’s management.
City management considers observable data to be that market data which is readily available,
regularly distributed or updated, reliable, and verifiable, not proprietary, and provided by multiple
independent sources that are actively involved in the relevant market.
The categorization of an investment within the hierarchy is based upon the relative observability of
the inputs to its fair value measurement and does not necessarily correspond to City management’s
perceived risk of that investment.
CITY OF PALM DESERT
NOTES TO BASIC FINANCIAL STATEMENTS
(CONTINUED)
June 30, 2016
- 59 -
2. CASH AND INVESTMENTS (CONTINUED):
Fair Value Measurements (Continued)
The methods described may produce a fair value calculation that may not be indicative of net
realizable value or reflective of future fair values. The use of different methodologies or
assumptions to determine the fair value of certain financial instruments could result in a different
fair value measurement at the reporting date.
When available, quoted prices are used to determine fair value. When quoted prices in active
markets are available, investments are classified within Level 1 of the fair value hierarchy. When
quoted prices in active markets are not available, fair values are based on evaluated prices received
by City’s asset manager from third party service provider.
The following is a description of the recurring valuation methods and assumptions used by the City
to estimate the fair value of its investments.
For a large portion of the City’s portfolio, the City’s custodian applies their leveling methodology
across all securities in a specific sector (i.e. U.S. Government Sponsored Agency Securities).
Inputs to their pricing models are based on observable market inputs in active markets.
The Successor Agency RDA’s investment in City bonds is not tradable and is categorized in
Level 3. When valuing Level 3 securities, the inputs or methodology are not necessarily an
indication of the risks associated with investing in those securities. Changes in valuation
techniques may result in transfers into or out of an assigned level within the disclosure hierarchy.
CITY OF PALM DESERT
NOTES TO BASIC FINANCIAL STATEMENTS
(CONTINUED)
June 30, 2016
- 60 -
2. CASH AND INVESTMENTS (CONTINUED):
Fair Value Measurements (Continued)
Primary Government
Quoted Observable Unobservable
Prices Inputs Inputs
Level 1 Level 2 Level 3 Total
U.S. Government Sponsored Agency Securities -$ 12,020,443$ -$ 12,020,443$
Medium-Term Corporate Notes - 25,034,615 - 25,034,615
Commercial Paper - 13,984,550 - 13,984,550
Total Leveled Investments -$ 51,039,608$ -$ 51,039,608
California Local Agency Investment Fund* 32,643,833
California Asset Management Program*152,421
Riverside County Treasurer's
Pooled Investment Fund*97,235,687
Held by Fiscal Agent:
Money Market Mutual Funds*1,327,521
California Local Agency Investment Fund* 74,277,266
Total Investment Portfolio 256,676,336$
* Not subject to fair value measurements
Investment Type
Fiduciary Funds
Quoted Observable Unobservable
Prices Inputs Inputs
Level 1 Level 2 Level 3 Total
Investment in City Bonds -
Successor Agency RDA -$ -$ 1,594,000$ 1,594,000$
Total Leveled Investments -$ -$ 1,594,000$ 1,594,000
California Asset Management Program*5,547,000
Riverside County Treasurer's
Pooled Investment Fund*16,031,098
Held by Fiscal Agent:
Money Market Mutual Funds* -
Successor Agency RDA 16,529,003
LAIF* - Successor Agency RDA 1,698,643
Money Market Mutual Funds* -
Assessment District 2,951,237
LAIF* - Assessment District 2,514,987
Total Investment Portfolio 46,865,968$
* Not subject to fair value measurements
Investment Type
CITY OF PALM DESERT
NOTES TO BASIC FINANCIAL STATEMENTS
(CONTINUED)
June 30, 2016
- 61 -
3. RECEIVABLES:
Primary Government’s Governmental Funds
Notes and Loans Receivable:
On August 8, 2006, the City Palm Desert issued $3,165,000 of Limited Obligation Bonds. The
proceeds of the Bonds were used to finance the construction of the utility undergrounding and pay
the cost of issuance. The debt service on the bonds is to be paid by assessments secured on the
property tax rolls of those properties benefiting from the improvements. Bond maturities began
September 2, 2007, and continue annually through 2036. The interest rates of the bonds range from
3.85% to 5.15%. The City of Palm Desert is the only bondholder on record for the bonds and
reports a receivable in the general fund that corresponds to the outstanding principal on the bonds.
As of June 30, 2016, the receivable balance was $1,451,000.
The City entered into several individual loan agreements with residents of the Highlands Utility
Undergrounding Assessment District No. 04-01. The loans were issued by the City to pay off the
principal of the respective properties assessment. In turn, the residents agreed to pay to the City the
full cost of the loan amount plus any accrued interest at a rate of 5.35%. The full amount of the
loan along with all accrued interest is due and payable at the earliest of September 2, 2036 or any
change in ownership of the property. As of June 30, 2016, the total receivable from the Highlands
Deferral Loan Program was $39,806.
Pursuant to Health and Safety Code 34176(b), the housing assets of the former RDA have been
transferred to the Low and Moderate Income Housing Asset Special Revenue Fund as the
successor housing entity. The Low and Moderate Income Housing Asset Special Revenue Fund
has a loan receivable for the construction of a multi-family affordable housing development dated
June 14, 2001, with a balance of $6,742,721 is due from the Palm Desert Development Company.
The loan is secured by a Deed of Trust with assignment to property, rent and fixtures on the
housing development located in Palm Desert. Interest is earned and due annually at a rate of 1%
per annum from the date on which the final certificate of occupancy is issued. Principal on the loan
is based on the applicable agency’s percentage of positive net cash flow derived from the
operations of the Development.
The Low and Moderate Income Housing Asset Special Revenue Fund has $6,064 in home
improvement loans and an additional notes receivable of $1,200. Payments of interest and principal
are due monthly on these loans.
The Community Development Block Grant Special Revenue Fund has $14,182 in a home
improvement loan.
CITY OF PALM DESERT
NOTES TO BASIC FINANCIAL STATEMENTS
(CONTINUED)
June 30, 2016
- 62 -
3. RECEIVABLES (CONTINUED):
Primary Government’s Governmental Funds (Continued)
Notes and Loans Receivable (Continued):
On August 28, 2008 the City Council approved through resolution the Energy Independence
Program (EIP), which is supported by Assembly Bill AB811. The EIP program allowed the City to
create the funding mechanism to assist the residents and businesses entering into a loan agreement
with the City and providing the money for the borrowers to acquire and install energy efficient
improvements. Assembly Bill AB811 allows the City to lien the properties through annual property
tax assessments for a period not to exceed 20 years. To date, 279 residents and business owners
entered into loan agreements with the City and have completed their improvements through the
EIP program, as of June 30, 2016, 75 loans have been repaid. The loans are payable in two annual
installments for a period of 5 years to 20 years at an interest rate of 7% annually. On June 30, 2016,
the outstanding loans receivable through the EIP Program was $4,280,375.
Pursuant to Health and Safety Code 34176(b), the housing assets of the former RDA have been
transferred to the Palm Desert Housing Authority as the successor housing entity. The Housing
Authority has loans for several other projects, all of which are secured by a deed of trust. A
valuation allowance equal to the loan balance has been recognized since there is a significant
possibility that these loans will either become uncollectible or forgiven by the Housing Authority
at a future date if all the terms of the loans have been met.
Detailed information for these loans is as follows:
Loan
Balance Interest Maturity Special Provisions
Project Name Outstanding Rate Date Secured By of Loan
Self-Help 429,000$ 7.25% 30 years Deed of Trust
Housing Program or 2024
Home Improvement
Loans
380,076 N/A N/A Deed of Trust
Loan balance and interest due
upon maturity, unpaid balance
of loan or interest will bear an
interest rate of 12%.
Loan is payable upon change
or transfer of title, refinancing
or upon the death of the
borrower. Restrictive
covenants are placed against
property to maintain
affordability for up to 45 years
in exchange for favorable loan
terms.
CITY OF PALM DESERT
NOTES TO BASIC FINANCIAL STATEMENTS
(CONTINUED)
June 30, 2016
- 63 -
3. RECEIVABLES (CONTINUED):
Primary Government’s Governmental Funds (Continued)
Notes and Loans Receivable (Continued):
Detailed information for these loans (Continued):
Loan
Balance Interest Maturity Special Provisions
Project Name Outstanding Rate Date Secured By of Loan
Portola Palms 110,715$ 3.00% 30 years Deed of Trust
Mobilehome Park from date
of loan
Desert Rose 2,406,687 3.00% 30 - 45 years* Deed of Trust
from date
of loan
Falcon Crest 5,646,439 3.00% 30 - 45 Deed of Trust
years
from date
of loan
Acquisition,
Rehabilitation,
190,510 3.00% 30 - 45
years
Deed of Trust
Assignment
Resale from date
of loan
of Rent
* All properties acquired from the former Redevelopment Agency after June 2009 will have a 45 year restrictive
covenant.
Loan is payable upon change
or transfer of title, refinancing
or upon the death of the
borrower. Restrictive
covenants are placed against
property to maintain
affordability for up to 45 years
in exchange for favorable loan
terms.
Loan is payable upon change
or transfer of title, refinancing
or upon the death of the
borrower.
Loan balance and interest will
be forgiven at maturity if
debtor does not breach the
terms and conditions of either
the unit regulatory agreement
or note.
Loan will be forgiven at
maturity unless the debtor is in
violation of the unit regulatory
agreement or the deed of trust.
CITY OF PALM DESERT
NOTES TO BASIC FINANCIAL STATEMENTS
(CONTINUED)
June 30, 2016
- 64 -
4. INTERFUND RECEIVABLES, PAYABLES AND TRANSFERS:
Due To/From Other Funds
The composition of interfund balances as of June 30, 2016, was as follows:
Due To Due From Amount
General Fund Other Governmental Funds $ 2,298,000
Low and Moderate Income Housing
Asset Special Revenue Fund General Fund 1,847,200
Other Governmental Funds 2,683,800
Other Governmental Funds Desert Willow Golf Course 500,000
$ 7,329,000
The General Fund advanced $2,298,000 to the Energy Independence Special Revenue Fund to
payoff the bonds used to fund energy efficiency.
The Low and Moderate Income Housing Asset Special Revenue Fund amounts are related to the
advances due from the Successor Agency (former Redevelopment Agency) per AB 1484.
The Golf Capital Projects Fund advanced $500,000 to Desert Willow Golf Course for operations
during the construction phase of the clubhouse and kitchen expansion.
Due To/From Component Unit
Due From
Component
Unit
Major Funds:
General Fund $ 285,000
Desert Willow Golf Course 1,170,647
$ 1,455,647
The receivable by the General Fund is for rent owed by the Palm Desert Recreational Facilities
Corporation (PDRFC), and the receivable by the Desert Willow Golf Course represents funds
loaned to PDRFC for operation.
CITY OF PALM DESERT
NOTES TO BASIC FINANCIAL STATEMENTS
(CONTINUED)
June 30, 2016
- 65 -
4. INTERFUND RECEIVABLES, PAYABLES AND TRANSFERS (CONTINUED):
Interfund Transfers
The composition of interfund transfers as of June 30, 2016, was as follows:
Prop A
Fire Tax
Special Other Internal
General Revenue Governmental Service
Transfers Out: Fund Fund Funds Total Fund Totals
General Fund -$ 3,000,000$ 859,928$ 3,859,928$ 282,000$ 4,141,928$
Housing Authority
Special Revenue
Fund - - 733,708 733,708 - 733,708
Other
Governmental
Funds 1,152,758 - 46,812 1,199,570 - 1,199,570
Office Complex
Parkview
Enterprise Fund 237,500 - - 237,500 - 237,500
Totals 1,390,258$ 3,000,000$ 1,640,448$ 6,030,706$ 282,000$ 6,312,706$
Transfers In
Transfers are used to:
1. Transfer revenues to provide for capital projects,
2. Transfer revenues to provide for additional resources to pay for expenditures,
3. Transfer to cover future cost of assets, and
4. Transfer to provide resources to pay for compensated absences.
CITY OF PALM DESERT
NOTES TO BASIC FINANCIAL STATEMENTS
(CONTINUED)
June 30, 2016
- 66 -
5. CAPITAL ASSETS:
A summary of changes in capital assets at June 30, 2016, was as follows:
Primary Government - Governmental Activities
Balance at Balance at
July 1, 2015 Transfers Additions Deletions June 30, 2016
Capital assets, not
being depreciated:
Land 79,251,006$ 178,035$ 415,161$ (210,000)$ 79,634,202$
Right-of-way 121,048,118 - - - 121,048,118
Construction-in-progress 25,728,897 (13,259,548) 225,419 (10,399,384) 2,295,384
Internal service fund -
Construction-in-progress 421,272 - 115,335 - 536,607
Total capital assets, not
being depreciated 226,449,293 (13,081,513) 755,915 (10,609,384) 203,514,311
Capital assets, being
depreciated:
Buildings 127,307,066 12,273,377 4,974,985 (380,453) 144,174,975
Improvements other
than buildings 54,598,817 5,102,246 92,944 - 59,794,007
Machinery and equipment 10,057,147 (6,722) 277,416 (15,287) 10,312,554
Infrastructure 238,456,026 859,911 1,085,813 - 240,401,750
Equipment - Internal
service fund 5,142,750 11,691 628,254 (449,222) 5,333,473
Total capital assets,
being depreciated 435,561,806 18,240,503 7,059,412 (844,962) 460,016,759
Less accumulated
depreciation for:
Buildings (54,089,004) - (3,079,285) 105,151 (57,063,138)
Improvements other
than buildings (28,265,451) (4,250,701) (2,731,077) - (35,247,229)
Machinery and equipment (8,907,402) - (417,889) 15,287 (9,310,004)
Infrastructure (92,920,881) - (5,404,964) - (98,325,845)
Equipment - Internal
service fund (4,105,667) - (267,481) 433,014 (3,940,134)
Total accumulated
depreciation (188,288,405) (4,250,701) (11,900,696) 553,452 (203,886,350)
Capital assets, being
depreciated, net 247,273,401 13,989,802 (4,841,284) (291,510) 256,130,409
Capital assets, net -
Governmental Activities 473,722,694$ 908,289$ (4,085,369)$ (10,900,894)$ 459,644,720$
CITY OF PALM DESERT
NOTES TO BASIC FINANCIAL STATEMENTS
(CONTINUED)
June 30, 2016
- 67 -
5. CAPITAL ASSETS (CONTINUED):
A summary of changes in capital assets at June 30, 2016, was as follows:
Primary Government - Business-type Activities
Balance at Balance at
July 1, 2015 Additions Deletions June 30, 2016
Capital assets, not
being depreciated:
Land 52,736,087$ -$ -$ 52,736,087$
Total capital assets,
not being depreciated 52,736,087 - - 52,736,087
Capital assets, being
being depreciated:
Buildings and
improvements 27,181,837 123,303 - 27,305,140
Machinery and equipment 6,496,698 89,714 - 6,586,412
Total capital assets,
being depreciated 33,678,535 213,017 - 33,891,552
Less accumulated
depreciation for:
Buildings and
improvements (9,072,622) (967,771) - (10,040,393)
Machinery and equipment (4,777,211) (677,688) - (5,454,899)
Total accumulated
depreciation (13,849,833) (1,645,459) - (15,495,292)
Capital assets, being
depreciated, net 19,828,702 (1,432,442) - 18,396,260
Capital assets, net -
Business-type Activities 72,564,789$ (1,432,442)$ -$ 71,132,347$
CITY OF PALM DESERT
NOTES TO BASIC FINANCIAL STATEMENTS
(CONTINUED)
June 30, 2016
- 68 -
5. CAPITAL ASSETS (CONTINUED):
Depreciation expense was charged to functions/programs of the primary government as follows:
Governmental Activities:
General government $ 1,956,233
Housing and redevelopment 1,242,495
Public safety 113,285
Public works 5,942,818
Parks, recreation and culture 2,378,384
Depreciation expenses for internal service funds is charged
to various functions based on usage of capital assets 267,481
Total depreciation expense - governmental activities $ 11,900,696
Business-type Activities:
Desert Willow Golf Course $ 1,195,366
Parkview Office complex 450,093
Total depreciation expense - business-type activities $ 1,645,459
CITY OF PALM DESERT
NOTES TO BASIC FINANCIAL STATEMENTS
(CONTINUED)
June 30, 2016
- 69 -
6. LONG-TERM LIABILITIES:
The following is a summary of long-term liability transactions of the City for the year ended
June 30, 2016:
Primary Government - Governmental Activities
Balance Balance Due Within
July 1, 2015 Additions Reductions June 30, 2016 One Year
Special assessment debt
with government
commitment 1,489,000$ -$ (38,000)$ 1,451,000$ 41,000$
Limited obligation
improvement bonds 1,813,000 - (219,000) 1,594,000 116,000
Claims and judgments
payable 299,463 194,111 (169,242) 324,332 -
Compensated absences
payable 2,673,142 1,745,895 (2,005,372) 2,413,665 300,000
Total 6,274,605$ 1,940,006$ (2,431,614)$ 5,782,997$ 457,000$
Debt service payments for the special assessment debt with government commitment, tax
allocation bonds and notes payable are made from debt service funds and a special revenue fund.
Primary Government -Business-type Activities:
Balance Balance Due Within
July 1, 2015 Additions Reductions June 30, 2016 One Year
Capital leases 1,435,046$ -$ (505,186)$ 929,860$ 429,980$
CITY OF PALM DESERT
NOTES TO BASIC FINANCIAL STATEMENTS
(CONTINUED)
June 30, 2016
- 70 -
6. LONG-TERM LIABILITIES (CONTINUED):
Special Assessment Debt with Government Commitment
Highlands Undergrounding Assessment District No. 04-01, Limited Obligation Improvement
Bonds, Series 2006
On August 8, 2006, the City Palm Desert issued $3,165,000 of Limited Obligation Bonds. The
proceeds of the Bonds were used to finance the construction of the utility undergrounding and pay
the cost of issuance. The debt service on the bonds is to be paid by assessments secured on the
property tax rolls of those properties benefiting from the improvements. In the event that
assessment collections are insufficient to pay the debt service, the City has a potential obligation to
provide additional funds to pay the debt service, therefore these bonds are reported as special
assessment debt with government commitment. Bond maturities begin September 2, 2007, and
continue annually through 2036. The interest rates of the bonds range from 3.85% to 5.15%. The
City of Palm Desert is the only bondholder on record of the bonds and the City does not own the
constructed assets.
The future debt service requirements on the Highlands Undergrounding Assessment District
No. 04-01, Limited Obligation Improvement Bonds, Series 2006 are as follows:
Year Ending
June 30, Principal Interest Total
2017 41,000$ 72,994$ 113,994$
2018 42,000 70,991 112,991
2019 44,000 68,895 112,895
2020 47,000 66,653 113,653
2021 49,000 64,265 113,265
2022 - 2026 286,000 280,280 566,280
2027 - 2031 365,000 197,460 562,460
2032 - 2036 468,000 90,640 558,640
2037 109,000 2,807 111,807
1,451,000$ 914,985$ 2,365,985$
CITY OF PALM DESERT
NOTES TO BASIC FINANCIAL STATEMENTS
(CONTINUED)
June 30, 2016
- 71 -
6. LONG-TERM LIABILITIES (CONTINUED):
Limited Obligation Bonds
Limited Obligation Improvement Bonds Series 2009A (Taxable)
On January 29, 2009, the City issued $2,015,000 Limited Obligation Improvement Bonds
Series 2009A (Taxable). The proceeds of the Bonds were used to fund the City’s Energy
Independence Program. Concurrent with the issuance of the Bonds, the City entered into a bond
purchase agreement with the Agency whereby the Agency agreed to purchase the Bonds equal to
par value.
The Series 2009A (Taxable) bonds consist of $2,015,000 Serial Bonds with interest at 3% payable
semiannually on September 2 and March 2. Bond maturities commenced September 2, 2010, and
continue annually through September 2, 2029.
The future debt service requirements on the Limited Obligation Improvement Bonds Series 2009A
(Taxable) are as follows:
Year Ending
June 30, Principal Interest Total
2017 70,000$ 26,970$ 96,970$
2018 66,000 24,930 90,930
2019 65,000 22,965 87,965
2020 68,000 20,970 88,970
2021 62,000 19,020 81,020
2022 - 2026 328,000 66,120 394,120
2027 - 2030 275,000 16,785 291,785
934,000$ 197,760$ 1,131,760$
CITY OF PALM DESERT
NOTES TO BASIC FINANCIAL STATEMENTS
(CONTINUED)
June 30, 2016
- 72 -
6. LONG-TERM LIABILITIES (CONTINUED):
Limited Obligation Bonds (Continued)
Limited Obligation Improvement Bonds Series 2009B (Taxable)
On September 2, 2009, the City issued $1,136,000 Limited Obligation Improvement Bonds
Series 2009B (Taxable). The proceeds of the Bonds were used to fund the City’s Energy
Independence Program. Concurrent with the issuance of the Bonds, the City entered into a bond
purchase agreement with the Agency whereby the Agency agreed to purchase the Bonds equal to
par value.
The Series 2009B (Taxable) bonds consist of $1,136,000 Serial Bonds with interest at 3% payable
semiannually on September 2 and March 2. Bond maturities commenced September 2, 2010, and
continue annually through September 2, 2029.
The future debt service requirements on the Limited Obligation Improvement Bonds Series 2009B
(Taxable) are as follows:
Year Ending
June 30, Principal Interest Total
2017 46,000$ 19,110$ 65,110$
2018 47,000 17,715 64,715
2019 47,000 16,305 63,305
2020 48,000 14,880 62,880
2021 46,000 13,470 59,470
2022 - 2026 242,000 45,540 287,540
2027 - 2030 184,000 11,280 195,280
660,000$ 138,300$ 798,300$
CITY OF PALM DESERT
NOTES TO BASIC FINANCIAL STATEMENTS
(CONTINUED)
June 30, 2016
- 73 -
6. LONG-TERM LIABILITIES (CONTINUED):
Claims and Judgments Payable
Estimates for all workers’ compensation and general liabilities up to the self-insured levels have
been recorded as long-term liabilities. At June 30, 2016, total estimated workers’ compensation
and general liability claims payable, including a provision for incurred but not reported claims,
were $213,676 and $110,656, respectively, for a total claims and judgments payable of $324,332.
Changes in claims liabilities during the past two years are as follows:
June 30, 2015 June 30, 2016
Claims payable - Beginning of Year 1,021,332$ 299,463$
Incurred claims (including IBNR)
and changes in estimates (341,659) 194,111
Claims payments (380,210) (169,242)
Claims payable - End of Year 299,463$ 324,332$
CITY OF PALM DESERT
NOTES TO BASIC FINANCIAL STATEMENTS
(CONTINUED)
June 30, 2016
- 74 -
6. LONG-TERM LIABILITIES (CONTINUED):
Business-type Activities - Capital Leases
Obligations under capital leases are as follows:
De Lage Lande Public Finance LLC - The present value of the
minimum lease payment on the Club Car cart fleet equipment was
capitalized at $976,366 using an interest rate of 2.99%. The lease term
is 48 months with payments schedule in 24 periods during the months
of February through July of each year of the lease. Payments are
$33,671. There are no payments scheduled from August to January of
each year. Interest accrues each month. $ 648,067
GPSI Leasing, LLC - The present value of the minimum lease
payment on the GPSI Visage Golf Cart GPS System was capitalized at
$303,530 using an interest rate of 16.66%. On December 27, 2013 the
GPSI lease was amended to extend the agreement for an additional
31 months and lower the payment to $7,044. The amended lease is
payable in 48 monthly installments of $7,044 beginning
January 1, 2014. 83,557
Wells Fargo Financial Leasing, Inc. - The present value of the
minimum lease payment on the Toro golf course maintenance
equipment was capitalized at $1,547,296 using an interest rate of
2.63%. Lease is payable in 60 monthly installments of $27,489
beginning February, 28, 2012. 190,747
Wells Fargo Financial Leasing, Inc. - The present value of the
minimum lease payment on the TruTurf roller and Lely spreader were
capitalized at $41,440 using an interest rate of 2.63%. Lease is
payable in 60 monthly installments of $736 beginning
March 28, 2012. 5,832
Wells Fargo Financial Leasing Inc. - The present value of the
minimum lease payment on the JCB grapple bucket was capitalized at
$10,481 using an interest rate of 2.63%. Lease is payable in
60 monthly installments of $186 beginning April 28, 2012. 1,657
Present value of net minimum lease payments 929,860
Less: current portion (429,980)
$ 499,880
CITY OF PALM DESERT
NOTES TO BASIC FINANCIAL STATEMENTS
(CONTINUED)
June 30, 2016
- 75 -
6. LONG-TERM LIABILITIES (CONTINUED):
Business-type Activities - Capital Leases (Continued)
The following is a schedule, by year, of future minimum lease payments and present value of the
net minimum lease payments for capital leases as of June 30, 2016:
Minimum
Year Ending Lease
June 30, Payments
2017 486,541$
2018 244,289
2019 277,271
1,008,101
Less: amounts representing interest (78,241)
Present value of net minimum lease
payments 929,860$
The assets acquired through capital lease are as follows:
Machinery and equipment $ 3,026,023
Less: accumulated depreciation (2,321,007)
$ 705,016
7. DEFERRED COMPENSATION PLAN:
The City offers its employees a deferred compensation plan created in accordance with Internal
Revenue Code Section 457. The plan, available to all City employees, permits them to defer a
portion of their salary until future years. The deferred compensation is not available to employees
until termination, retirement, death or unforeseeable emergency. Pursuant to changes in
August 1996, of IRC Section 457, in January 1997, the City established a trust in which all assets
held by Nationwide Retirement Solutions, Inc. (NRS) and ICMA Retirement Corporation (ICMA)
were placed. The City does not have fiduciary responsibility for the plan assets held by NRS and
ICMA. The assets, all property and rights purchased with such amounts and all income attributable
to such amounts are held in trust for the exclusive benefit of the participants and the beneficiaries.
The assets are no longer the property of the City, and as such, are no longer subject to the claims of
the City’s general creditors. As a result, the assets in the amount of $12,350,415 held by NRS and
ICMA of the 457 Plan are not reflected in the City’s financial statements.
CITY OF PALM DESERT
NOTES TO BASIC FINANCIAL STATEMENTS
(CONTINUED)
June 30, 2016
- 76 -
8. PENSION PLAN:
a. General Information about the Pension Plan:
Plan Description
All qualified permanent and probationary employees are eligible to participate in the City’s
Miscellaneous Plan, agent multiple-employer defined benefit pension plans administered by the
California Public Employees’ Retirement System (CalPERS), which acts as a common
investment and administrative agent for its participating member employers. Benefit provisions
under the Plan are established by State statute and City resolution. CalPERS issues publicly
available reports that include a full description of the pension plan regarding benefit provisions,
assumptions and membership information that can be found on the CalPERS website.
Benefits Provided
CalPERS provides service retirement and disability benefits, annual cost of living adjustments
and death benefits to plan members, who must be public employees and beneficiaries. Benefits
are based on years of credited service, equal to one year of full time employment. Members
with five years of total service are eligible to retire at age 50 with statutorily reduced benefits.
All members are eligible for non-duty disability benefits after 10 years of service. The death
benefit is one of the following: the Basic Death Benefit, the 1957 Survivor Benefit, or the
Optional Settlement 2W Death Benefit. The cost of living adjustments for each plan are applied
as specified by the Public Employees’ Retirement Law.
CITY OF PALM DESERT
NOTES TO BASIC FINANCIAL STATEMENTS
(CONTINUED)
June 30, 2016
- 77 -
8. PENSION PLAN (CONTINUED):
a. General Information about the Pension Plan (Continued):
Benefits Provided (Continued)
The Plan’s provisions and benefits in effect at June 30, 2016, are summarized as follows:
Prior to On or After
Hire date January 1, 2013 January 1, 2013
Benefit formula 2.7%@55 2%@62
Benefit vesting schedule 5 years of service 5 years of service
Benefit payments monthly for life monthly for life
Retirement age 50 - 67 52 - 67
Monthly benefits, as a % of eligible compensation 2.0% to 2.7% 1.0% to 2.5%
Required employee contribution rates 7% - 8% 6.25%
Required employer contribution rates 32.663% 32.663%
Miscellaneous
Employees Covered
At June 30, 2016, the following employees were covered by the benefit terms for all Plans:
Inactive employees or beneficiaries
currently receiving benefits 140
Inactive employees entitled to but
not yet receiving benefits 76
Active employees 118
Total 334
Contributions
Section 20814(c) of the California Public Employees’ Retirement Law requires that the
employer contribution rates for all public employers be determined on an annual basis by the
actuary and shall be effective on the July 1 following notice of a change in the rate. Funding
contributions for both Plans are determined annually on an actuarial basis as of June 30 by
CalPERS. The actuarially determined rate is the estimated amount necessary to finance the
costs of benefits earned by employees during the year, with an additional amount to finance
any unfunded accrued liability. The City is required to contribute the difference between the
actuarially determined rate and the contribution rate of employees.
CITY OF PALM DESERT
NOTES TO BASIC FINANCIAL STATEMENTS
(CONTINUED)
June 30, 2016
- 78 -
8. PENSION PLAN (CONTINUED):
b. Net Pension Liability:
The City’s net pension liability for each Plan is measured as the total pension liability, less the
pension plan’s fiduciary net position. The net pension liability of each of the Plans is measured
as of June 30, 2015, using an annual actuarial valuation as of June 30, 2014 rolled forward to
June 30, 2015 using standard update procedures. A summary of principal assumptions and
methods used to determine the net pension liability is shown below.
Actuarial Assumptions
The total pension liabilities in the June 30, 2014 actuarial valuations were determined using the
following actuarial assumptions:
Valuation Date June 30, 2014
Measurement Date June 30, 2015
Actuarial Cost Method Entry-Age Normal
Cost Method
Actuarial Assumptions:
Discount Rate 7.65%
Inflation 2.75%
Payroll Growth 3.00%
Projected Salary Increase (1)
Investment Rate of Return 7.5% (2)
Mortality (3)
(1) Depending on age, service and type of employment
(2) Net of pension plan investment expenses, including inflation
(3) The probabilities of mortality are derived using CalPERS' membership data for all funds.
The mortality table used was developed based on CalPERS' specific data. The table
includes 20 years of mortality improvements using Society of Actuaries Scale BB. For
more details on this table, please refer to the 2014 experience study report.
All other actuarial assumptions used in the June 30, 2014 valuation were based on the results of
an actuarial experience study for the period from 1997 to 2011, including updates to salary
increase, mortality and retirement rates. The Experience Study report can be obtained at the
CalPERS website under Forms and Publications.
CITY OF PALM DESERT
NOTES TO BASIC FINANCIAL STATEMENTS
(CONTINUED)
June 30, 2016
- 79 -
8. PENSION PLAN (CONTINUED):
b. Net Pension Liability (Continued):
Change of Assumptions
GASB 68, paragraph 68 states that the long-term expected rate of return should be determined
net of pension plan investment expense but without reduction for pension plan administrative
expense. The discount rate of 7.50% used for the June 30, 2014 measurement date was net of
administrative expenses. The discount rate of 7.65% used for the June 30, 2015 measurement
date is without reduction of pension plan administrative expense.
Discount Rate
The discount rate used to measure the total pension liability was 7.65% for each Plan. To
determine whether the municipal bond rate should be used in the calculation of a discount rate
for each plan, CalPERS stress tested plans that would most likely result in a discount rate that
would be different from the actuarially assumed discount rate. Based on the testing of the
Plans, the tests revealed the assets would not run out. Therefore, the current 7.65% discount
rate is appropriate and the use of the municipal bond rate calculation is not deemed necessary.
The long term expected discount rate of 7.65% is applied to all plans in the Public Employees
Retirement Fund (PERF). The stress test results are presented in a detailed report called
“GASB Crossover Testing Report” that can be obtained from the CalPERS website under the
GASB 68 section.
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.
In determining the long-term expected rate of return, CalPERS took into account both
short-term and long-term market return expectations as well as the expected pension fund cash
flows. Such cash flows were developed assuming that both members and employers will make
their required contributions on time and as scheduled in all future years. Using historical
returns of all the funds’ asset classes, expected compound (geometric) returns were calculated
over the short-term (first 10 years) and the long-term (11-60 years) using a building-block
approach. Using the expected nominal returns for both short-term and long-term, the present
value of benefits was calculated for each fund. The expected rate of return was set by
calculating the single equivalent expected return that arrived at the same present value of
benefits for cash flows as the one calculated using both short-term and long-term returns. The
expected rate of return was then set equivalent to the single equivalent rate calculated above
and rounded down to the nearest one quarter of one percent.
CITY OF PALM DESERT
NOTES TO BASIC FINANCIAL STATEMENTS
(CONTINUED)
June 30, 2016
- 80 -
8. PENSION PLAN (CONTINUED):
b. Net Pension Liability (Continued):
Discount Rate (Continued)
The table below reflects the long-term expected real rate of return by asset class. The rate of
return was calculated using the capital market assumptions applied to determine the discount
rate and asset allocation. The target allocation shown was adopted by the CalPERS Board
effective on July 1, 2014.
New Real Return Real Return
Strategic Years Years
Allocation 1 - 10 (a) 11+ (b)
Global Equity 51.00% 5.25% 5.71%
Global Fixed Income 19.00% 0.99% 2.43%
Inflation Sensitive 6.00% 0.45% 3.36%
Private Equity 10.00% 6.83% 6.95%
Real Estate 10.00% 4.50% 5.13%
Infrastructure and Forestland 2.00% 4.50% 5.09%
Liquidity 2.00% -0.55% -1.05%
Total 100.00%
(a) An expected inflation of 2.5% used for this period
(b) An expected inflation of 3.0% used for this period
Asset Class
CITY OF PALM DESERT
NOTES TO BASIC FINANCIAL STATEMENTS
(CONTINUED)
June 30, 2016
- 81 -
8. PENSION PLAN (CONTINUED):
c. Changes in the Net Pension Liability:
The changes in the net pension liability for the year ended June 30, 2016, with a measurement
date of June 30 2015, for the Miscellaneous Plan are as follows:
Total Plan Net Pension
Pension Fiduciary Liability
Liability Net Position (Asset)
Balance at June 30, 2014 113,199,769$ 75,608,498$ 37,591,271$
Changes in the Year:
Service cost 2,125,437 - 2,125,437
Interest on the total pension liability 8,223,320 - 8,223,320
Differences between expected
and actual experience (2,378,254) - (2,378,254)
Changes in assumptions (2,091,348) - (2,091,348)
Changes in benefit terms - - -
Contributions - employer - 4,065,411 (4,065,411)
Contributions - employee - 878,171 (878,171)
Net investment income - 1,682,498 (1,682,498)
Benefit payments, including refunds
of employee contributions (4,597,025) (4,597,025) -
Administrative expense - (87,279) 87,279
Net Changes 1,282,130 1,941,776 (659,646)
Balance at June 30, 2015
(Measurement Date)114,481,899$ 77,550,274$ 36,931,625$
Increase (Decrease)
CITY OF PALM DESERT
NOTES TO BASIC FINANCIAL STATEMENTS
(CONTINUED)
June 30, 2016
- 82 -
8. PENSION PLAN (CONTINUED):
c. Changes in the Net Pension Liability (Continued):
Sensitivity of the Net Pension Liability to Changes in the Discount Rate
The following presents the net pension liability of the City for each Plan, calculated using the
discount rate for each Plan, as well as what the City’s net pension liability would be if it were
calculated using a discount rate that is 1-percentage point lower or 1-percentage point higher
than the current rate:
1% Decrease 6.65%
Net Pension Liability 52,921,216$
Current Discount Rate 7.65%
Net Pension Liability 36,931,625$
1% Increase 8.65%
Net Pension Liability 23,762,711$
Pension Plan Fiduciary Net Position
Detailed information about each pension plan’s fiduciary net position is available in the
separately issued CalPERS financial reports.
d. Pension Expenses and Deferred Outflows/Inflows of Resources Related to Pensions:
For the year ended June 30, 2016, the City recognized pension expense of $1,902,336. At
June 30, 2016, the City reported deferred outflows of resources and deferred inflows of
resources related to pensions from the following sources:
Deferred Deferred
Outflows Inflows
of Resources of Resources
Pension contributions subsequent to measurement date 4,260,098$ -$
Differences between actual and expected experience - (1,635,050)
Change in assumptions - (1,437,802)
Net differences between projected and actual
earnings on plan investments - (583,859)
Total 4,260,098$ (3,656,711)$
CITY OF PALM DESERT
NOTES TO BASIC FINANCIAL STATEMENTS
(CONTINUED)
June 30, 2016
- 83 -
8. PENSION PLAN (CONTINUED):
d. Pension Expenses and Deferred Outflows/Inflows of Resources Related to Pensions
(Continued):
$4,260,098 reported as deferred outflows of resources related to contributions subsequent to the
measurement date will be recognized as a reduction of the net pension liability in the year
ending June 30, 2017. Other amounts reported as deferred inflows of resources related to
pensions will be recognized as pension expense as follows:
Year
Ending
June 30, Amount
2017 (1,865,223)$
2018 (1,865,223)
2019 (747,826)
2020 821,561
2021 -
Thereafter -
e. Payable to the Pension Plan:
At June 30, 2016, the City had no outstanding amount of contributions to the pension plan
required for the year ended June 30, 2016.
9. FUND BALANCES:
Fund Balances
In the fund financial statements, reserves segregate portions of fund balances that are either not
available or have been earmarked for specific purposes. The various reserves established as of
June 30, 2016, were as follows:
CITY OF PALM DESERT
NOTES TO BASIC FINANCIAL STATEMENTS
(CONTINUED)
June 30, 2016
- 84 -
9. FUND BALANCES (CONTINUED):
Low Moderate CFD University Other
General Prop A Housing Housing Special Assessment Capital Governmental
Fund Fire Tax Asset Measure A Authority District Properties Funds Total
Nonspendable:
Advances 7,631,800$ -$ -$ -$ -$ -$ -$ -$ 7,631,800$
Loans and notes
receivables 1,490,806 - - - - - - - 1,490,806
Prepaid costs 406,024 - - - - - - 3,052 409,076
Total Nonspendable 9,528,630 - - - - - - 3,052 9,531,682
Restricted for:
Capital projects:
Assessment districts
improvements - - - - - 1,812,064 - 180,574 1,992,638
Capital bond projects - - 6,585,289 - - - 65,697,188 - 72,282,477
Total capital projects - - 6,585,289 - - 1,812,064 65,697,188 180,574 74,275,115
Debt service - - - - - - - 90,074 90,074
Low income housing:
Projects and programs - - 41,793,436 - - - - 2,530,186 44,323,622
Apartments - - - - 8,863,643 - - 8,863,643
Total low income housing - - 41,793,436 - 8,863,643 - - 2,530,186 53,187,265
Public facilities:
City facilities - - - - - - - 133,997 133,997
Childcare facilities - - - - - - - 1,196,989 1,196,989
Public facilities - - - - - - - 2,490,005 2,490,005
Total public facilities - - - - - - - 3,820,991 3,820,991
Public safety:
Fire facilities - - - - - - - 1,032,024 1,032,024
Fire operations - 2,302,300 - - - - - - 2,302,300
Police programs & equipment - - - - - - - 7,026 7,026
Total public safety - 2,302,300 - - - - - 1,039,050 3,341,350
Special programs:
Community projects - - - - - - - 19,181 19,181
Recycling projects - - - - - - - 3,047,138 3,047,138
Special district advertising - - - - - - - 59,682 59,682
Air quality projects - - - - - - - 103,940 103,940
Landscaping and lighting - - - - - - - 2,695,488 2,695,488
Art construction - - - - - - - 1,694,212 1,694,212
Total special programs - - - - - - - 7,619,641 7,619,641
Street related purposes:
Construction & improvements - - - 18,983,951 - - - 1,399,656 20,383,607
Drainage projects - - - - - - - 2,079,961 2,079,961
Traffic signals projects - - - 262,520 - - - 351,020 613,540
Total street related purposes - - - 19,246,471 - - - 3,830,637 23,077,108
Total Restricted - 2,302,300 48,378,725 19,246,471 8,863,643 1,812,064 65,697,188 19,111,153 165,411,544
Committed to:
Aquatic center - - - - - - - 2,133,281 2,133,281
Capital asset replacement - - - - 11,875,488 - - - 11,875,488
Energy loan program - - - - - - - 2,865,065 2,865,065
Total Committed - - - - 11,875,488 - - 4,998,346 16,873,834
Assigned to:
Capital projects:
City capital outlay projects 96,080 - - - - - - 6,427,470 6,523,550
Property acquisition - - - - - - - 420,387 420,387
Community contingency 454,000 - - - - - - - 454,000
Public facilities:
City facilities - - - - - - 14,541 3,366,684 3,381,225
Parks facilities - - - - - - - 3,895,862 3,895,862
Golf facilities - - - - - - - 3,104,539 3,104,539
Total public facilities - - - - - - 14,541 10,367,085 10,381,626
Special programs:
Library - - - - - - - 667,255 667,255
General plan - - - - - - - 63,870 63,870
Professional services 174,533 - - - - - - 857,786 1,032,319
Total special programs 174,533 - - - - - - 1,588,911 1,763,444
Street related purposes:
Construction and improvements - - - - - - - 2,788,663 2,788,663
Street resurfacing 217,462 - - - - - - - 217,462
Street maintenance 49,778 - - - - - - - 49,778
Drainage projects - - - - - - - 2,042,645 2,042,645
Traffic signals projects - - - - - - - 126,766 126,766
Total street related purposes 267,240 - - - - - - 4,958,074 5,225,314
Total Assigned 991,853 - - - - - 14,541 23,761,927 24,768,321
Unassigned 71,842,172 - - - - - - - 71,842,172
Totals 82,362,655$ 2,302,300$ 48,378,725$ 19,246,471$ 20,739,131$ 1,812,064$ 65,711,729$ 47,874,478$ 288,427,553$
Special Revenue Funds Capital Projects Funds
CITY OF PALM DESERT
NOTES TO BASIC FINANCIAL STATEMENTS
(CONTINUED)
June 30, 2016
- 85 -
9. FUND BALANCES (CONTINUED):
Fund Balances (Continued)
The fund balances reported on the fund statements now consist of the following categories:
Nonspendable - This classification includes amounts that cannot be spent because they are either
(a) not in spendable form or (b) legally or contractually required to be maintained intact.
Restricted - This classification includes amounts that can be spent only for specific purposes
stipulated by constitution, external resource providers or through enabling legislation.
Committed - This classification includes amounts that can be used only for the specific purposes
determined by a formal action of the City Council. The City considers the adoption of a resolution
to institute a formal action of City Council for the purpose of establishing, modifying or rescinding
committed fund balances.
Assigned - This classification includes amounts to be used by the government for specific purposes
but do not meet the criteria to be classified as restricted or committed. This includes amounts that
are assigned through adoption of a resolution by City Council. The Council may delegate the
ability of an employee or committee to assign uses of specific funds, for specific purposes. Such
delegation of authority has not yet been granted to persons or bodies other than the City Council.
Unassigned - This classification includes the residual balance for the government’s general fund
and includes all spendable amounts not contained in other classifications. In other funds, the
unassigned classification is used only to report a deficit balance resulting from overspending for
specific purposes for which amounts had been restricted, committed or assigned.
When an expenditure is incurred for purposes for which both restricted and unrestricted fund
balances are available, the City’s policy is to apply restricted fund balance first.
When an expenditure is incurred for purposes for which committed, assigned or unassigned fund
balances are available, the City’s policy is to apply committed fund balance first, then assigned
fund balance, and finally unassigned fund balance.
CITY OF PALM DESERT
NOTES TO BASIC FINANCIAL STATEMENTS
(CONTINUED)
June 30, 2016
- 86 -
10. RISK MANAGEMENT:
a. Description of Self-Insurance Pool Pursuant to Joint Powers Agreement:
The City of Palm Desert is a member of the California Joint Powers Insurance Authority
(Authority). The Authority is composed of 116 California public entities and is organized
under a joint powers agreement pursuant to California Government Code §6500 et seq. The
purpose of the Authority is to arrange and administer programs for the pooling of self-insured
losses, to purchase excess insurance or reinsurance, and to arrange for group purchased
insurance for property and other lines of coverage. The Authority began covering claims of its
members in 1978. Each member government has an elected official as its representative on the
Board of Directors which operates through a nine-member Executive Committee.
b. Self-Insurance Programs of the Authority:
Each member pays an annual contribution to cover estimated losses for the coverage period. A
retrospective adjustment is then conducted annually thereafter, for coverage years 2012-13 and
prior. Retrospective adjustments are scheduled to continue indefinitely on coverage
years 2012-13 and prior, until all claims incurred during those coverage years are closed, on a
pool-wide basis. This subsequent cost re-allocation among members, based on actual claim
development, can result in adjustments of either refunds or additional deposits required.
Coverage years 2013-14 and forward are not subject to routine annual retrospective adjustment.
The total funding requirement for self-insurance programs is estimated using actuarial models
and pre-funded through the annual contribution. Costs are allocated to individual agencies
based on exposure (payroll) and experience (claims) relative to other members of the
risk-sharing pool. Additional information regarding the cost allocation methodology is
provided below.
Liability
In the liability program, claims are pooled separately between police and general government
exposures. (1) The payroll of each member is evaluated relative to the payroll of other members. A
variable credibility factor is determined for each member, which establishes the weight applied to
payroll and the weight applied to losses within the formula. (2) The first layer of losses includes
incurred costs up to $30,000 for each occurrence and is evaluated as a percentage of the pool’s
total incurred costs within the first layer. (3) The second layer of losses includes incurred costs
from $30,000 to $750,000 for each occurrence and is evaluated as a percentage of the pool’s total
incurred costs within the second layer. (4) Incurred costs from $750,000 to $50 million, are
distributed based on the outcome of cost allocation within the first and second loss layers.
CITY OF PALM DESERT
NOTES TO BASIC FINANCIAL STATEMENTS
(CONTINUED)
June 30, 2016
- 87 -
10. RISK MANAGEMENT (CONTINUED):
b. Self-Insurance Programs of the Authority (Continued):
Liability (Continued)
For 2015-16, the Authority’s pooled retention is $2 million per occurrence, with reinsurance to
$20 million, and excess insurance to $50 million. The Authority’s reinsurance contracts are
subject to the following additional pooled retentions: (a) $2.5 million annual aggregate
deductible in the $3 million x/s $2 million layer, and (b) $3 million annual aggregate
deductible in the $5 million x/s $10 million layer. There is a third annual aggregate deductible
in the amount of $2.5 million in the $5 million x/s $5 million layer, however it is fully covered
under a separate policy and therefore not retained by the Authority.
The overall coverage limit for each member, including all layers of coverage, is $50 million
per occurrence. Costs of covered claim for subsidence losses have a sub-limit of $30 million
per occurrence.
Workers’ Compensation
The City of Palm Desert also participates in the workers’ compensation pool administered by
the Authority. In the workers’ compensation program claims are pooled separately between
public safety (police and fire) and general government exposures. (1) The payroll of each
member is evaluated relative to the payroll of other members. A variable credibility factor is
determined for each member, which establishes the weight applied to payroll and the weight
applied to losses within the formula. (2) The first layer of losses includes incurred costs up to
$50,000 for each occurrence and is evaluated as a percentage of the pool’s total incurred costs
within the first layer. (3) The second of losses includes incurred costs from $50,000 to
$100,000 for each occurrence and is evaluated as a percentage of the pool’s total incurred costs
within the second layer. (4) Incurred costs in excess from $100,000 to statutory limits are
distributed based on the outcome of cost allocation within the first and second loss layers.
For 2015-16, the Authority’s pooled retention is $2 million per occurrence, with reinsurance to
statutory limits under California Workers’ Compensation Law.
Employer’s Liability losses are pooled among members to $2 million. Coverage from
$2 million to $5 million is purchased as part of a reinsurance policy, and Employer’s Liability
losses from $5 million to $10 million are pooled among members.
CITY OF PALM DESERT
NOTES TO BASIC FINANCIAL STATEMENTS
(CONTINUED)
June 30, 2016
- 88 -
10. RISK MANAGEMENT (CONTINUED):
c. Purchased Insurance:
Property Insurance
The City of Palm Desert participates in the all-risk property protection program of the
Authority. This insurance protection is underwritten by several insurance companies. The City
of Palm Desert’s property is currently insured according to a schedule of covered property
submitted by the City of Palm Desert to the Authority. The City of Palm Desert’s property
currently has all-risk property insurance protection in the amount of $216,848,665. There is a
$5,000 deductible per occurrence except for non-emergency vehicle insurance, which has a
$1,000 deductible. Premiums for the coverage are paid annually and are not subject to
retrospective adjustments.
Crime Insurance
The City of Palm Desert purchases crime insurance coverage in the amount of $10,000,000
with a $2,500 deductible. The fidelity coverage is provided through the Authority. Premiums
are paid annually and are not subject to retroactive adjustments.
Special Event Tenant User Liability Insurance
The City of Palm Desert further protects against liability damages by requiring tenant users of
certain property to purchase low-cost tenant user liability insurance for certain activities on
City property. The insurance premium is paid by the tenant user and is paid to the City of Palm
Desert according to a schedule. The City of Palm Desert then pays for the insurance. The
insurance is arranged by the Authority.
d. Adequacy of Protection:
During the past three fiscal years, none of the above programs of protection experienced
settlements or judgments that exceeded pooled or insured coverage. There were no significant
reductions in pooled or insured liability coverage in the fiscal year 2015-16.
CITY OF PALM DESERT
NOTES TO BASIC FINANCIAL STATEMENTS
(CONTINUED)
June 30, 2016
- 89 -
11. UNEARNED REVENUES AND DEFERRED INFLOWS OF RESOURCES:
Unearned Revenues
Major Governmental Funds
General Fund has received $16,976 in unearned revenues from the Successor Agency that are
deemed unearned until expenditures are incurred related to park improvements and $1,288 in
advance rent payments.
Measure A Special Revenue Fund has $15,052,983 in funds received from the Successor Agency
that are deemed unearned until expenditures are incurred related to construction of interchange.
Housing Authority Special Revenue Fund has other amounts reported as unearned revenues
include $14,948 for prepaid rents.
Other Governmental Funds
Special Revenue Funds
$6,860 of grant funds are deemed unearned until expenditures are incurred in the Recycling Fund.
$30,626 of grant funds are deemed unearned until expenditures are incurred in the Public Safety
Police Grants Fund.
$17,500 represents the unused portions of prepaid aquatic fees in the Aquatic Center Fund.
Capital Projects Fund
Capital Projects Reserve fund has $71,596 of unearned revenue represents deposits for street
improvements and public facilities, as the funds have not been spent as of June 30, 2016.
Business-type Activities
The balance of $119,631 represents the unused portions of prepaid golf fees, value of unredeemed
gift certificates and unearned rent.
Component Unit
The balance of $68,311 represents the unused portions of prepaid banquets.
CITY OF PALM DESERT
NOTES TO BASIC FINANCIAL STATEMENTS
(CONTINUED)
June 30, 2016
- 90 -
11. UNEARNED REVENUES AND DEFERRED INFLOWS OF RESOURCES (CONTINUED):
Deferred Inflows of Resources
Major Governmental Funds
General Fund
On March 13, 1997, the former Redevelopment Agency (Agency) purchased land from the City for
the purpose of developing a second golf course financed by a note in the amount of $2,055,000.
The note has no specific due date. Recognition of the revenue from the sale has been reported as
deferred inflows of resources until it becomes available.
On March 13, 1997, the City entered into an agreement with subsequent amendments on
June 4, 1997, May 18, 2004, and May 12, 2009, with the Palm Desert Recreational Facilities
Corporation (Corporation) for the use of property at the City’s Golf Resort (Desert Willow).
Payment is due when the Corporation’s revenues exceed its expenses. At June 30, 2016, the
Corporation owed the City rent totaling $285,000, which will be recognized as revenue by the City
when the rent is paid by the Corporation.
The State of California collects taxes and fees for the City and makes payments to the City at
various times. Due to the City’s policy of recognizing revenue, the amount of $493,897 for sales
tax has been reported as unavailable.
The City entered into several individual loan agreements with residents of the Highlands Utility
Undergrounding Assessment District No. 04-01. The residents agreed to pay to the City the full
cost of the loan amount plus any accrued interest at a rate of 5.35%. The full amount of the loan
along with all accrued interest is due and payable at the earliest of September 2, 2036, or any
change in ownership of the property. As of June 30, 2016, $29,030 in interest has been accrued.
Recognition of the interest revenue has been reported as unavailable until it becomes due.
Interest receivable in the amount of $52,455 on the advance from the General Fund to the Energy
Independence Special Revenue Fund, and $79,972 on investments purchased, and $1,219,152 on
advances to the Successor Agency is reported as unavailable revenue.
Other accounts receivable for reimbursement of court fees in the amount of $21,677 is not
available at year end.
CITY OF PALM DESERT
NOTES TO BASIC FINANCIAL STATEMENTS
(CONTINUED)
June 30, 2016
- 91 -
11. UNEARNED REVENUES AND DEFERRED INFLOWS OF RESOURCES (CONTINUED):
Deferred Inflows of Resources (Continued)
Major Governmental Funds (Continued)
Low and Moderate Housing Asset Special Revenue Fund
Uncollected interest on notes receivable of $33,714 due from the Palm Desert Development
Company has been reported as unavailable.
Interest in the amount of $747,615 on advances to the Successor Agency is reported as unavailable
revenue.
Measure A Special Revenue Fund
Unavailable revenue of $1,133,769 is related to expenditures incurred through June 30, 2016,
which are to be reimbursed from other governments, but have not been received within the
availability period.
Other Governmental Funds
Special Revenue Funds
Interest accrued on loans of $167,634 on loans receivable through the City’s EIP Program is
reported as unavailable (see Note 3).
The Community Development Block Grant Special Revenue Fund has $14,182 in a home
improvement loan as unavailable.
The New Construction Tax Special Revenue Fund has $86,328 in interest on advances to the
Successor Agency is reported as unavailable.
Debt Service Fund
Assessment receivables in the amount of $1,309,422 represent future assessments to be received
from property owners in Highlands Undergrounding Assessment Districts 04-1 to pay for long-
term obligations incurred in making capital improvements in the Assessment District. Recognition
of the revenue from the assessments has been deferred until it becomes available. Once received,
the monies will be used to make annual debt service payments.
CITY OF PALM DESERT
NOTES TO BASIC FINANCIAL STATEMENTS
(CONTINUED)
June 30, 2016
- 92 -
11. UNEARNED REVENUES AND DEFERRED INFLOWS OF RESOURCES (CONTINUED):
Deferred Inflows of Resources (Continued)
Other Governmental Funds (Continued)
Capital Projects Funds
The Parks and Recreation Facilities Capital Projects Fund has $628,980 in interest on advances to
the Successor Agency is reported as unavailable.
The Capital Projects Reserve Capital Projects Fund has $1,056,000 in interest on advances to the
Successor Agency is reported as unavailable.
12. OTHER POST-EMPLOYMENT BENEFITS:
a. Plan Description:
In addition to the pension benefits described in Note 8, the City provides other
post-employment benefits (OPEB) through the California Employers’ Retiree Benefit Trust
Fund (CERBT), an agent multiple-employer defined benefit healthcare plan administered by
the California Public Employees’ Retirement System (CalPERS).
All full-time or part-time employees who meet the eligibility requirements for this program
may continue their medical coverage through the CalPERS Health Plan and receive
reimbursement from the City for a portion of the costs for the coverage. Separate financial
statements for the CERBT may be obtained by writing to CalPERS at Lincoln Plaza North, 400
Q Street, Sacramento, CA 95811, or by visiting the CalPERS website at www.calpers.ca.gov.
Employees Hired Prior to January 1, 2008
Eligibility for the stipend requires retirement simultaneously from the City and CalPERS on or
after age 50 with at least 10 consecutive years of service with the City. Eligible employees
must be covered under the CalPERS Health Plan at the time of retirement and elect to
participate in the stipend program within 30 days of retirement.
CITY OF PALM DESERT
NOTES TO BASIC FINANCIAL STATEMENTS
(CONTINUED)
June 30, 2016
- 93 -
12. OTHER POST-EMPLOYMENT BENEFITS (CONTINUED):
a. Plan Description (Continued):
Employees Hired Prior to January 1, 2008 (Continued)
The City’s contribution towards the coverage is based on years of service as follows:
Consecutive Years of Service City’s Contribution
With the City at Retirement Percentage
10 years of service 50%
11 years of service 55%
12 years of service 60%
13 years of service 65%
14 years of service 70%
15 or more years of service 75%
Employees Hired On or After January 1, 2008
Eligibility for the stipend requires retirement simultaneously from the City and CalPERS on or
after age 50 with at least 15 consecutive years of service with the City. Eligible employees
must be covered under the CalPERS Health Plan at the time of retirement and elect to
participate in the stipend program within 30 days of retirement. The stipend is discontinued
when the retiree reaches Medicare eligibility age. The City’s contribution towards the
coverage will be applied to the lowest cost plan and is based on age at retirement and
consecutive years of service with the City as outlined in the following table:
Age1516171819202122232425+
50 0% 5% 10% 15% 20% 25% 30% 35% 40% 45% 50%
51 10% 15% 20% 25% 30% 35% 40% 45% 50% 50% 50%
52 20% 25% 30% 35% 40% 45% 50% 50% 50% 50% 50%
53 30% 35% 40% 45% 50% 50% 50% 50% 50% 50% 50%
54 40% 45% 50% 50% 50% 50% 50% 50% 50% 50% 50%
55+ 50% 50% 50% 50% 50% 50% 50% 50% 50% 50% 50%
Consecutive Years of Service at Retirement
Employees with at least 5 years of service, not meeting the eligibility requirements for the
stipend program, who retire simultaneously from the City and CalPERS are eligible to continue
medical coverage through the CalPERS Health Plan. The City is required to pay the CalPERS
minimum employer contribution ($122 in 2015 and $125 in 2016) for these employees.
CITY OF PALM DESERT
NOTES TO BASIC FINANCIAL STATEMENTS
(CONTINUED)
June 30, 2016
- 94 -
12. OTHER POST-EMPLOYMENT BENEFITS (CONTINUED):
a. Plan Description (Continued):
Employees Hired On or After January 1, 2015
Employees are not eligible for either of the defined retiree health benefits plan, but are instead
enrolled in the City’s ICMA Retirement Health Savings Account. Employees have a
mandatory 1% contribution to the Retirement Health Savings Plan and the City matches the 1%
contribution. In addition, an employee can participate in the ICMA 401A Governmental
Money Purchase Plan with a maximum pre-tax dollar contribution of 10%, with the City
maximum match of 2%.
b. Funding Policy:
The contribution requirements of plan members and the City are established and may be
amended by the City, City Council, and/or the employee associations. Currently, contributions
are not required from plan members. During the fiscal year ended June 30, 2016, the City
contributed $828,371 to the plan. The City’s funding policy is to fund 100% of the annual
required contribution as determined under GASB 45 through the California Employer’s Retiree
Benefit Trust (CERBT). As a result, the City calculated and recorded a Net OPEB Asset,
representing the difference between the Annual Required Contribution (ARC) and actual
contributions, as presented below:
Annual required contribution (ARC) 585,217$
Interest on Net OPEB obligation (asset) (571,622)
Adjustment to ARC 583,674
Annual OPEB cost 597,269
Contribution made (828,371)
Increase in Net OPEB obligation (asset) (231,102)
Net OPEB obligation (asset) at June 30, 2015 (8,493,635)
Net OPEB obligation (asset) at June 30, 2016 (8,724,737)$
The contribution is based on the ARC of $585,217, an amount actuarially determined in
accordance with the parameters of GASB Statement No. 45. The ARC represents a level of
funding that, if paid on an ongoing basis is projected to cover the annual normal cost and the
amortization of unfunded actuarial accrued liabilities (or funding excess) over a twenty-two
year period.
CITY OF PALM DESERT
NOTES TO BASIC FINANCIAL STATEMENTS
(CONTINUED)
June 30, 2016
- 95 -
12. OTHER POST-EMPLOYMENT BENEFITS (CONTINUED):
c. Annual OPEB Cost and Net OPEB Obligation (Asset):
For fiscal year 2016, the City’s annual OPEB cost (expense) was $597,269. Information on the
annual OPEB cost, percentage of Annual OPEB cost contributed, and Net OPEB Obligation
(Asset) is available for June 30, 2016 and the two previous fiscal years, are presented below:
Actual Percentage of
Fiscal Annual Contribution Annual Net OPEB
Year OPEB (Net of OPEB Cost Obligation
Ended Cost Adjustments) Contributed (Asset)
6/30/2014 $ 296,678 $ 776,318 262% $ (8,448,611)
6/30/2015 313,752 358,776 114% (8,493,635)
6/30/2016 597,269 828,371 139% (8,724,737)
d. Funded Status and Funding Progress:
As of June 30, 2015, the most recent actuarial valuation date, the plan was 76% funded. The
actuarial accrued liability for benefits was $14.77 million, and the actuarial value of assets was
$11.26 million, resulting in an unfunded actuarial accrued liability (UAAL) of $3.51 million.
The covered payroll (annual payroll of active employees covered by the plan) was
$10.97 million, and the ratio of the UAAL to the covered payroll was 32%.
Actuarial valuations of an ongoing plan involve estimates of the value of reported amounts and
assumptions about the probability of occurrence of events far into the future. Examples include
assumptions about future employment, mortality, and the healthcare cost trend. Amounts
determined regarding the funded status of the plan and the annual required contributions of the
City are subject to continual revision as actual results are compared with past expectations and
new estimates are made about the future. The schedule of funding progress, presented as
required supplementary information following the notes to basic financial statements, presents
multi-year trend information about whether the actuarial value of plan assets is increasing or
decreasing over time relative to the actuarial accrued liability for benefits.
e. Actuarial Methods and Assumptions:
Projections of benefits for financial reporting purposes are based on the substantive plan and
include the types of benefits provided at the time of each valuation. The actuarial methods and
assumptions used include techniques that are designed to reduce the effects of short-term
volatility in actuarial accrued liabilities and the actuarial value of assets consistent with the
long-term perspective of the calculations.
CITY OF PALM DESERT
NOTES TO BASIC FINANCIAL STATEMENTS
(CONTINUED)
June 30, 2016
- 96 -
12. OTHER POST-EMPLOYMENT BENEFITS (CONTINUED):
e. Actuarial Methods and Assumptions (Continued):
In the June 30, 2015 actuarial valuation, the entry age normal actuarial cost method was used.
The actuarial assumptions included a 6.73% investment rate of return (net of administrative
expenses) and an actual healthcare cost trend rate in 2015, decreased to 7% in 2016 and then
reduced by decrements to an ultimate rate of 5% in 2020. A 3.0% per annum in aggregate in
future salaries is also assumed in the valuation. The City’s unfunded actuarial accrued liability
will be amortized as a level percentage of projected covered payroll on a closed basis. The
remaining amortization period at June 30, 2016, was 22 years.
13. SPECIAL ASSESSMENT DEBT:
Below is a summary of the changes in the special assessment bonds payable:
Balance at Payments and Balance at Due Within
July 1, 2015 Additions Reductions June 30, 2016 One Year
2003 Assessment
Revenue Bonds 2,015,000$ -$ (155,000)$ 1,860,000$ 160,000$
AD 98-1 Limited Obligation
Refunding Bonds 290,000 - (95,000) 195,000 60,000
CFD 2005-1 Special Tax
Bonds Series 2006A 53,360,000 - (22,230,000) 31,130,000 1,045,000
AD 2004-2 Limited Obligation
Improvement Bonds 23,775,000 - (590,000) 23,185,000 610,000
2008 Special Tax
Refunding Bonds 3,730,000 - (1,030,000) 2,700,000 1,070,000
83,170,000$ -$ (24,100,000)$ 59,070,000$ 2,945,000$
The City has Special Assessment Bonds Payable issued under the 1911 and 1915, Special
Improvement Acts and the 1982 Mello-Roos Community Facilities Act (1982 Bonds). The City has
no liability to 1911 Act bondholders until assessments have been collected from the property
owner. Such liability is then recorded in the Agency Funds. Therefore, the 1911 Bonds are not
recorded as liabilities in the accompanying financial statements.
The City also has no liability to the 1915 Act bondholders or the bondholders of bonds issued
under the 1982 Mello-Roos Community Facilities Act until assessments are collected on the tax
rolls. However, the City may take certain actions to assume secondary liability for all or part of
1915 Act Bonds and the 1982 Bonds until such time as foreclosure proceedings are consummated.
Special assessment bonds payable, as described below, and are not recorded as long-term
liabilities, as these obligations do not constitute a debt or obligation of the City.
CITY OF PALM DESERT
NOTES TO BASIC FINANCIAL STATEMENTS
(CONTINUED)
June 30, 2016
- 97 -
13. SPECIAL ASSESSMENT DEBT (CONTINUED):
2003 Assessment Revenue Bonds
In June 2003, the Palm Desert Financing Authority issued $4,423,000 in 2003 Assessment
Revenue Bonds. The proceeds were used to purchase three series of limited obligation
improvement bonds issued by the City in connection with the financing and refinancing of certain
improvements of benefit to property within the City’s Assessment District No. 94-2 (Sunterrace),
Assessment District No. 94-3 (Merano) and Silver Spur Ranch Utility Undergrounding Assessment
District No. 01-01. These bonds were issued under the 1915 Improvement Bond Act to provide
funds for public improvements in the respective assessment districts.
Debt service requirements to maturity are as follows:
Year Ending
June 30, Principal Interest Total
2017 160,000$ 93,489$ 253,489$
2018 170,000 85,154 255,154
2019 175,000 76,356 251,356
2020 175,000 67,344 242,344
2021 180,000 58,069 238,069
2022 - 2026 570,000 194,753 764,753
2027 - 2029 430,000 35,475 465,475
1,860,000$ 610,640$ 2,470,640$
As of June 30, 2016, the principal amounts to be repaid by each assessment district to pay off the
loans from the Financing Authority are as follows:
Assessment District 94-3 435,000$
Assessment District 01-1 1,435,000
1,870,000$
CITY OF PALM DESERT
NOTES TO BASIC FINANCIAL STATEMENTS
(CONTINUED)
June 30, 2016
- 98 -
13. SPECIAL ASSESSMENT DEBT (CONTINUED):
Assessment District 98-1 Limited Obligation Refunding Improvement Bonds
The bonds were issued in an original amount of $2,955,000 in February 2004, to redeem and
defease the outstanding limited obligation improvement bonds of Assessment District No. 98-1,
which were issued in 1998. The bonds are secured by unpaid assessments on parcels within the
District.
Under the 1915 Act, annual assessments on the unpaid assessments sufficient to meet the
scheduled debt service requirements are to be included on the regular county tax bills for the
assessed parcels for which there are unpaid assessments. Interest rates vary from 1.5% to 5.1%
with interest payable semi-annually on March 2 and September 2, with principal maturing annually
on September 2.
Debt service requirements to maturity are as follows:
Year Ending
June 30, Principal Interest Total
2017 60,000$ 8,283$ 68,283$
2018 65,000 5,195 70,195
2019 70,000 1,785 71,785
195,000$ 15,263$ 210,263$
Community Facilities District No. 2005-1
The bonds were issued in an original amount of $50,000,000 in May 2006, to construct and acquire
certain public facilities of benefit to the District, provide for the establishment of a reserve account,
provide capitalized interest, and pay the costs of issuance of the bonds. The bonds are secured by
and payable from a pledge of net taxes derived from special taxes to be levied by the District on
real properties within the boundaries of the District from the net proceeds of any foreclosure
actions brought following delinquency in the payment of the special taxes, and from amounts held
in certain funds under the indenture. Interest rates vary from 4.0% to 5.5% with interest payable
semi-annually on March 1 and September 1, with principal maturing annually on September 1.
CITY OF PALM DESERT
NOTES TO BASIC FINANCIAL STATEMENTS
(CONTINUED)
June 30, 2016
- 99 -
13. SPECIAL ASSESSMENT DEBT (CONTINUED):
Community Facilities District No. 2005-1 (Continued)
In May 2007, the 2007 Bonds were issued in the amount of $17,915,000 pursuant to the Bond
Indenture in May 2006, as supplemented by a First supplemental Indenture in May 2007, to
provide construct and acquire certain public facilities of benefit to the District, provide capitalized
interest, and pay the costs of issuance of the 2007 Bonds. The bonds are secured by and payable,
on parity with the bonds issued in May 2006 for $50,000,000, from a pledge of net taxes derived
from special taxes to be levied by the District on real properties within the boundaries of the
District from the net proceeds of any foreclosure actions brought following delinquency in the
payment of the special taxes, and from amounts held in certain funds under the indenture. On
March 1, 2016, a combined total of $20,885,000 of the outstanding bonds were called. Interest
rates vary from 3.875% to 5.20% with interest payable semi-annually on March 1 and September
1, with principal maturing annually on September 1.
Debt service requirements to maturity are as follows:
Year Ending
June 30, Principal Interest Total
2017 1,045,000$ 1,626,716$ 2,671,716$
2018 890,000 1,579,125 2,469,125
2019 935,000 1,533,500 2,468,500
2020 980,000 1,485,625 2,465,625
2021 1,030,000 1,435,375 2,465,375
2022 - 2026 5,990,000 6,305,325 12,295,325
2027 - 2031 7,805,000 4,494,840 12,299,840
2032 - 2036 10,100,000 2,087,908 12,187,908
2037 - 2038 2,355,000 64,763 2,419,763
31,130,000$ 20,613,177$ 51,743,177$
CITY OF PALM DESERT
NOTES TO BASIC FINANCIAL STATEMENTS
(CONTINUED)
June 30, 2016
- 100 -
13. SPECIAL ASSESSMENT DEBT (CONTINUED):
Section 29 Assessment District (No 2004-02), Limited Obligation Improvement Bonds,
Series 2007
In March 2007, the City of Palm Desert issued $29,430,000 Limited Obligation Improvement
Bonds. The proceeds of the Bonds will be used to finance certain infrastructure improvements
within the City’s Section 29 Assessment District (No. 2004-02). The debt service on the bonds is
to be paid by assessments secured on the property tax rolls of those properties benefiting from the
improvements. The bonds consist of Serial Bonds in the amount of $6,870,000 with interest
ranging from 4.00% to 4.70% payable semiannually on March 2 and September 2. Bond maturities
begin September 2, 2009, and continue annually through 2019. Term bonds in the amount of
$2,525,000 carry an interest rate of 4.75% and mature September 2, 2022. Term bonds in the
amount of $5,110,000 carry an interest rate of 5.05% and mature September 2, 2027. Term bonds
in the amount of $14,925,000 carry an interest rate of 5.10% and mature September 2, 2037.
Debt service requirements to maturity are as follows:
Year Ending
June 30, Principal Interest Total
2017 610,000$ 1,145,655$ 1,755,655$
2018 640,000 1,117,210 1,757,210
2019 670,000 1,086,913 1,756,913
2020 700,000 1,054,885 1,754,885
2021 735,000 1,020,979 1,755,979
2022 - 2026 4,225,000 4,523,891 8,748,891
2027 - 2031 5,395,000 3,317,685 8,712,685
2032 - 2036 6,920,000 1,756,185 8,676,185
2037 - 2038 3,290,000 169,830 3,459,830
23,185,000$ 15,193,233$ 38,378,233$
CITY OF PALM DESERT
NOTES TO BASIC FINANCIAL STATEMENTS
(CONTINUED)
June 30, 2016
- 101 -
13. SPECIAL ASSESSMENT DEBT (CONTINUED):
2008 Special Tax Refunding Bonds
In December 2007, the City of Palm Desert Communities Facilities District No. 91-1 (Indian Ridge
Public Improvements) issued $10,935,000 of Special Tax Refunding Bonds, Series 2008 to refund
and defease all the outstanding $16,260,000 principal amount of the Palm Desert Financing
Authority 1997 Revenue Bonds. These bonds were issued pursuant to the provisions of the
Mello-Roos Community Facilities Act of 1982, as amended, being Chapter 2.5, Part 1, Division 2,
Title 5, of the Government Code of the State of California.
Debt service requirements to maturity are as follows:
Year Ending
June 30, Principal Interest Total
2017 1,070,000$ 81,698$ 1,151,698$
2018 1,105,000 41,719 1,146,719
2019 170,000 17,600 187,600
2020 175,000 10,700 185,700
2021 180,000 3,600 183,600
2,700,000$ 155,317$ 2,855,317$
Bond Reserve Requirements
At June 30, 2016, the fund balance reserve requirements and actual reserve balances were as
follows:
Requirement Actual
Assessment District 98-1 19,500$ 73,570$
2003 Financing Authority Revenue Bonds 237,561 368,796
CFD 2005-1 Special Tax Bonds 2,671,716 2,513,426
Assessment District 29 1,757,210 1,778,478
2008 Special Tax Refunding Bonds 713,829 849,260
CITY OF PALM DESERT
NOTES TO BASIC FINANCIAL STATEMENTS
(CONTINUED)
June 30, 2016
- 102 -
14. CONDUIT DEBT OBLIGATIONS:
2003 Series A - $22,310,000 Lease Revenue Bonds
In December 2003, the Palm Desert Financing Authority (Authority) issued $22,310,000 in Lease
Revenue Bonds. The proceeds of the Bonds were used to: a) finance the construction of a County
animal shelter and related facilities located in the unincorporated area of Thousand Palms,
California; b) finance construction of certain County medical clinic facilities located in Mecca,
California; c) refund the Palm Desert Financing Authority Lease Revenue Bonds Series 1996;
d) acquire a debt service reserve insurance policy; e) fund capitalized interest on the bonds; and
f) pay costs of issuance of the bonds. The Authority will lease sites relating to each project from
the County of Riverside (County) pursuant to a Site Lease dated as of December 1, 2003, and will
lease back to the County the Sites and the Facilities pursuant to a Facilities Lease dated
December 1, 2003. Under the Lease, the County will pay to the Trustee Base Rental Payments in
the amount equal to the scheduled debt service of the Bonds. The Authority will assign its right to
receive the Base Rental Payments to the Trustee for the benefit of the owners of the bonds. The
debt service on the bonds is to be paid solely from lease payments made by the County. The
Authority has no obligation to make the debt service payments in the event that the County is not
able to make the required base rental payments. As of June 30, 2016, the outstanding amount was
$15,150,000.
2008 Series A - $72,445,000 Lease Revenue Bonds
In November 2008, the Palm Desert Financing Authority (Authority) issued $72,445,000 in Lease
Revenue Bonds. The proceeds of the Bonds were used to: a) finance the construction, installation,
acquisition, development and rehabilitation of certain public capital improvements within the
County, including the Palm Desert Sheriff’s Station Facilities (as described herein), community
centers, a multi-service center, park improvements and other various infrastructure improvements;
b) fund capitalized interest on the 2008 Series A Bonds related to the Palm Desert Sheriff Station
Facilities through August 31, 2010 and with respect to the Multi-Service Center Facilities (as
described herein) through December 31, 2009; c) fund a deposit into the Reserve Account as
additional security for the 2008 Series A Bonds; and d) pay certain costs associated with the
issuance and delivery of the 2008 Series A Bonds. Under the Lease, the County will pay to the
Trustee Base Rental Payments in the amount equal to the scheduled debt service of the Bonds. The
Authority will assign its right to receive the Base Rental Payments to the Trustee for the benefit of
the owners of the bonds. The debt service on the bonds is to be paid solely from lease payments
made by the County. The Authority has no obligation to make the debt service payments in the
event that the County is not able to make the required base rental payments. As of June 30, 2016,
the outstanding amount was $40,680,000.
CITY OF PALM DESERT
NOTES TO BASIC FINANCIAL STATEMENTS
(CONTINUED)
June 30, 2016
- 103 -
15 OTHER DISCLOSURES:
The Palm Desert Recreational Facilities Corporation has a deficit o $1,346,561, which will be
eliminated by increasing revenues through banquet reservations and outings directly related to the
expansion of the outside dining terrace and the kitchen.
The Fiduciary Private-Purpose Trust Fund has a deficit of $253,823,275, which will be funded
through future property taxes collected by the County under the direction of the State. The State of
California is the responsible body for the elimination of this deficit.
16. CONSTRUCTION AND OTHER SIGNIFICANT COMMITMENTS:
Construction Commitments
Primary Government
Current Prior
Year Year Remaining
Spent Spent Commitment
Parks and recreation 44,564$ -$ 95,209$
Low income housing - - 164,935
Street resurfacing 671,275 - 515,219
Street improvements 1,200 - 90,150
Freeway on-ramp improvements 10,285 - 9,158
Desert Willow capital improvements 5,778 - 14,222
Office complex building improvements 9,108 - 5,752
Recycle projects 15,225 - 69,775
Community development planning 247,331 - 102,947
CDBG 98,059 - 92,362
Façade enhancement - - 75,000
Governmental software implementation 130,543 - 41,672
Promotional advertising/rebranding 28,267 - 90,232
Alessandro West improvement project 103,217 22,912 50,082
Drainage improvements 10,073 - 323,845
Property sales / transfers 232,173 30,790 67,238
1,607,098 53,702 1,807,798
Miscellaneous nonconstruction 99,970 20,625 188,905
1,707,068$ 74,327$ 1,996,703$
Project
CITY OF PALM DESERT
NOTES TO BASIC FINANCIAL STATEMENTS
(CONTINUED)
June 30, 2016
- 104 -
16. CONSTRUCTION AND OTHER SIGNIFICANT COMMITMENTS (CONTINUED):
Construction Commitments (Continued)
Fiduciary Funds
Current Prior
Year Year Remaining
Spent Spent Commitment
Parks and recreation -$ -$ 357$
Low income housing 21,349 - 7,740
Desert Willow capital improvements - - 667,246
21,349 - 675,343
Miscellaneous nonconstruction 153,174 - 133,569
174,523$ -$ 808,912$
Project
17. DISSOLUTION OF CALIFORNIA REDEVELOPMENT AGENCIES:AND WIND-DOWN BY
SUCCESSOR AGENCIES:
The California Legislature adopted AB X1 26 in June 2011, adding Part 1.8 (commencing with
Section 34161) and Part 1.85 (commencing with Section 34170) to Division 24 of the California
Health and Safety Code. Part 1.8 immediately suspended the power of California redevelopment
agencies to engage in most activities, except to implement existing contracts, meet already-
incurred obligations, preserve existing assets and prepare for impending dissolution. Pursuant to
Part 1.85, all redevelopment agencies in the State (each a “Dissolved RDA”) were dissolved as of
February 1, 2012, and a successor agency (“SARDA”) was established for each former
redevelopment agency to wind-down the affairs of its former redevelopment agency.
Since AB X1 26, there have been several amendments and additions the provisions of Parts 1.8
and 1.85, including among others, AB 1484 adopted in June 2012, and SB 107 adopted in
September 2015. Parts 1.8 and 1.85, as amended and supplemented, are referred to below as the
“Dissolution Act.”
Pursuant to the Dissolution Act, the city which formed a redevelopment agency would serve as the
SARDA unless the city elects to do otherwise. On August 25, 2011, the City Council adopted
Resolution No. 2011-76, electing for the City to serve as the SARDA.
CITY OF PALM DESERT
NOTES TO BASIC FINANCIAL STATEMENTS
(CONTINUED)
June 30, 2016
- 105 -
17. DISSOLUTION OF CALIFORNIA REDEVELOPMENT AGENCIES AND WIND-DOWN BY
SUCCESSOR AGENCIES (CONTINUED):
On February 9, 2012, the City Council of the City, acting as the governing body of the SARDA,
established rules and regulations for the operations of the SARDA to assume these successor
functions pursuant to Resolution No. SA-RDA001. Although the Board of Directors of the
SARDA is comprised of the same individuals as the City Council of the City, subdivision (g) of
Section 34173 of the Dissolution Act, expressly affirms that the SARDA is a separate public entity
from the City, that the two entities shall not merge, and that the liabilities of the Dissolved RDA
will not be transferred to the City nor will the assets of the Dissolved RDA become assets of the
City.
The Dissolution Act requires the establishment of an oversight board for each SARDA. Under the
Dissolution Act, certain SARDA actions must first be approved by the oversight board, and the
oversight board is also required to direct the SARDA to take certain actions in connection with the
wind down of the affairs of the Dissolved RDA. The role of a SARDA is to administer the wind
down of its Dissolved RDA which includes making payments due on enforceable obligations,
disposing of the assets (other than housing assets) and pursuant to due diligence reviews described
below, remitting the unencumbered balances of the Dissolved RDAs to the County Auditor-
Controller for distribution to the affected taxing entities.
The Dissolution Act allowed the sponsoring community that formed the Dissolved RDA to elect to
assume the housing functions and take over the housing assets of the Dissolved RDA. If the
sponsoring community does not elect to become the Housing Successor and assume the Dissolved
RDA’s housing functions, such housing functions and all related housing assets will be transferred
to the local housing authority in the jurisdiction. The City of Palm Desert elected on
February 9, 2012 to transfer the responsibility to serve as the Housing Successor to the Palm
Desert Housing Authority. As required by the Dissolution Act, the Housing Authority, as the
Housing Successor, submitted to the State Department of Finance (“DOF”) of a list of housing
assets to be transferred by the SARDA to the Housing Successor. On August 31, 2012, the DOF
issued a letter indicating that the DOF did not have any objection to such housing asset list.
After the date of dissolution, the housing assets, obligations, and activities of the Dissolved RDA
were transferred to the Housing Successor and are reported in the Low and Moderate Income
Housing Asset Special Revenue Fund beginning in fiscal year 2011-2012. Outstanding bonds
(“Housing Bonds”), secured by a pledge of moneys which would have been deposited into the
Dissolved RDA’s low and moderate income housing fund (known as the “Housing Set Aside”),
remain as the SARDA’s enforceable obligations. See also “Stipulated Judgment” below. All other
assets, obligations, and activities of the Dissolved RDA have been transferred and are reported in a
fiduciary fund (private-purpose trust fund) in the financial statements of the City.
CITY OF PALM DESERT
NOTES TO BASIC FINANCIAL STATEMENTS
(CONTINUED)
June 30, 2016
- 106 -
17. DISSOLUTION OF CALIFORNIA REDEVELOPMENT AGENCIES:AND WIND-DOWN BY
SUCCESSOR AGENCIES (CONTINUED):
The Dissolution Act also established roles for the County Auditor-Controller (the “CAC”), the
DOF, and the California State Controller’s office in the dissolution process and the satisfaction of
enforceable obligations of the Dissolved RDAs.
The CAC is charged with establishing a Redevelopment Property Tax Trust Fund (the “RPTTF”)
for each SARDA and depositing into the RPTTF the amount of property taxes that would have
been redevelopment property tax increment had the Dissolved RDA not been dissolved.
The SARDA is required to prepare a recognized obligation payment schedule (the “ROPS”)
approved by the oversight board setting forth the amounts due for each enforceable obligation
during each ROPS period. The ROPS is submitted to the CAC and the DOF for consideration. The
CAC will only make payments to the SARDA from the RPTTF fund based on the ROPS amount
approved by the DOF.
As part of the dissolution process, AB1484 required the SARDA to have due diligence reviews of
both the low and moderate income housing funds and all other funds completed by
October 15, 2012 and January 15, 2013, respectively, to compute the funds (cash) which were not
needed by the SARDA to be retained to pay for existing enforceable obligations or were otherwise
restricted. These funds were to be remitted to the CAC after the DOF completed its review of the
due diligence reviews. The SARDA paid a total amount of $40,988,399 to the CAC based on the
final determination by the DOF.
The DOF issued a Finding of Completion on May 15, 2013 in which DOF concurred that the
SARDA has made full payments of any payments required as a result of the due diligence reviews.
The Finding of Completion allows the placement of loan agreements between the Dissolved RDA
and the City (which were previously voided by operation of the Dissolution Act) on the ROPS. On
February 23, 2015, the Oversight Board approved Resolution OB-114, making the finding to re-
establish the City loans as enforceable obligations of the SARDA. DOF subsequently approved
this action on April 10, 2015. When the repayments begin, 20% of each repayment amount will be
allocated to the Low and Moderate Income Housing Asset Special Revenue Fund. At
June 30, 2016, the long-term advances totaled $22,655,000 (the “Advances”). In the financial
statements $9,236,000 is reported in the General Fund and $13,419,000 is reported in Other
Governmental Funds. An offset of 20% has been reported as due to other funds in the respective
funds totaling $4,531,000, which is based on principal only. See further discussion under Note 18.
CITY OF PALM DESERT
NOTES TO BASIC FINANCIAL STATEMENTS
(CONTINUED)
June 30, 2016
- 107 -
17. DISSOLUTION OF CALIFORNIA REDEVELOPMENT AGENCIES:AND WIND-DOWN BY
SUCCESSOR AGENCIES (CONTINUED):
Pursuant to SB 107, adopted in September 2015, unpaid interest on the remaining principal amount
of the Advances shall be calculated at a simple rate of 3%. No interest on the Advances has been
paid since December 31, 2010. Based on the 3% simple rate, the unpaid accrued interest on the
Advances as of June 30, 2016 totaled $3,738,075.
The State Controller of the State of California was directed to review the propriety of any transfers
of assets between Dissolved RDA and other public bodies that occurred after January 1, 2011. If
the public body that received such transfers is not contractually committed to a third party for the
expenditure or encumbrance of those assets, the State Controller is required to order the available
assets to be transferred to the public body designated as the SARDA. The State Controller
completed its review on March 14, 2013 and did not identify any unallowable transfers of assets
that occurred during the audit between the Dissolved RDA, the City and or other public agencies.
The SARDA’s use and disposition of all properties held (Long Range Property Management Plan
(“LRPMP”), was approved by the DOF on June 2, 2014. The LRPMP allowed the SARDA to
transfer property used for government purposes with a cost basis of $6,390,263 to the City.
Stipulated Judgment
On May 15, 1991, the Riverside County Superior Court entered a final judgment incorporating the
terms of a Stipulation for Entry of Judgment (“Original Stipulation”) in Case No. 51124 and a
Stipulation for Entry of Judgment pursuant to Settlement Agreement and Mutual Release
(“Settlement Agreement”) in Case No. 51124, among the Dissolved RDA, the City, the Western
Center on Law and Poverty, Inc., California Rural Legal Assistance, and others. On June 18, 1997
and on September 20, 2002, the Riverside County Superior Court amended the judgment,
incorporating Stipulations Amending Stipulation for Entry of Judgment.
The judgment, as amended (the “Judgment”), generally required the Dissolved RDA to use 20% of
its tax increment revenues, and additional tax increment revenues if necessary, to develop,
rehabilitate, or otherwise financially assist affordable housing units and to meet certain housing
needs of the City. Before dissolution, the Dissolved RDA used its Low and Moderate Housing
Set-Aside to fulfill its obligations under the Judgment (including the payment of debt service on
the Housing Bonds issued to finance and refinance affordable housing projects that satisfied the
requirements of both the Judgment and the relevant Redevelopment Law provisions).
CITY OF PALM DESERT
NOTES TO BASIC FINANCIAL STATEMENTS
(CONTINUED)
June 30, 2016
- 108 -
17. DISSOLUTION OF CALIFORNIA REDEVELOPMENT AGENCIES:AND WIND-DOWN BY
SUCCESSOR AGENCIES (CONTINUED):
Stipulated Judgment (Continued)
While the Dissolution Act has eliminated the low and moderate income housing fund and the
requirement to deposit the Housing Set-Aside into such fund, the SARDA continues to recognize
the Judgment as its enforceable obligation. On its ROPS, the SARDA has included line items
designated as “Stipulation Judgment Case No. 51124,” listing the amounts necessary to fulfill its
obligations under the Judgment (after taking into account the amounts already listed for the
repayment of the Housing Bonds). While the DOF originally approved such line items, the DOF
changed its position beginning with ROPS 14-15A (i.e., covering the period commencing July 1,
2014).
On August 14, 2014, the SARDA filed an action, SARDA to the Palm Desert Redevelopment
Agency v. Michael Cohen, Sacramento Superior Court Case No. 34-2014-00167698 (the
“Successor Agency Lawsuit”), seeking to compel the DOF to permit payment of the affordable
housing obligations mandated by the Judgment. Subsequently, in view of the fact that there were
similar cases pending in the California Third District Court of Appeal, the SARDA took action to
have the Successor Agency Lawsuit dismissed without prejudice, pending resolution of those
similar cases.
18. SUCCESSOR AGENCY DISCLOSURES:
The assets and liabilities of the Dissolved RDA were transferred to the SARDA on
February 1, 2012 as a result of the dissolution of the former Redevelopment Agency. The SARDA
is acting in a fiduciary capacity for the assets and liabilities. Disclosures related to these
transactions are as follows:
Advances To/From the City of Palm Desert
The composition of advances as of June 30, 2016, was as follows:
Advances From Advances To Amount
General Fund Successor Agency $ 9,236,000
Other Governmental Funds Successor Agency 13,419,000
Subtotal 22,655,000
Low and Moderate Income Housing
Asset Special Revenue Fund Successor Agency 14,068,138
Total $ 36,723,138
CITY OF PALM DESERT
NOTES TO BASIC FINANCIAL STATEMENTS
(CONTINUED)
June 30, 2016
- 109 -
18. SUCCESSOR AGENCY DISCLOSURES (CONTINUED):
Advances To/From the City of Palm Desert (Continued)
The advances from the General Fund and Other Governmental Funds were made to the Dissolved
RDA for capital improvements. The Dissolved RDA’s Low and Moderate Income Housing Fund
made advances to the Dissolved RDA for the purpose of covering the SERAF payment.
The Dissolution Act specifies the actions to be taken and the method of repayment by the SARDA
to the various funds of the City for such loans. Upon application and approval by the SARDA and
approval by the oversight board, loan agreements entered into by Dissolved RDA and the city shall
be deemed to be enforceable obligations provided that the oversight board makes a finding that the
advances were for legitimate redevelopment purposes. The accumulated interest on the remaining
amount of advances will be recalculated pursuant to the provisions of SB 107.
The advances repayable to City Funds are to be repaid with a defined schedule over a reasonable
term of years, are subject to a formula distribution, and have a lower priority for repayment relative
to the repayment of SERAF loans.
The advances related to the borrowing for the SERAF payment have a priority over repayment of
the other advances. 20% of the repayment of the other advances not related to the SERAF advances
shall be deducted and transferred to the Low and Moderate Income Housing Asset Fund (Housing
Authority, as Housing Successor). Both SERAF and City Loans were approved by both the
Oversight Board and DOF as enforceable obligations of the SARDA. The initial repayments of the
SERAF loan have been included and approved with the 15-16A ROPS period.
CITY OF PALM DESERT
NOTES TO BASIC FINANCIAL STATEMENTS
(CONTINUED)
June 30, 2016
- 110 -
18. SUCCESSOR AGENCY DISCLOSURES (CONTINUED):
Capital Assets
Balance at Balance at
July 1, 2015 Transfers Additions Deletions June 30, 2016
Capital assets, not
being depreciated:
Land 41,768,297$ -$ 210,000$ (6,477,179)$ 35,501,118$
Construction-in-progress - (158,165) 158,165 - -
Total capital assets, not
being depreciated 41,768,297 (158,165) 368,165 (6,477,179) 35,501,118
Capital assets, being
depreciated:
Buildings 949,776 - 321,753 (6,650) 1,264,879
Improvements other
than buildings 5,048,117 (5,000,825) - (47,292) -
Total capital assets,
being depreciated 5,997,893 (5,000,825) 321,753 (53,942) 1,264,879
Less accumulated
depreciation for:
Buildings (213,339) - (91,280) 1,136 (303,483)
Improvements other
than buildings (4,072,825) 4,250,701 (188,516) 10,640 -
Total accumulated
depreciation (4,286,164) 4,250,701 (279,796) 11,776 (303,483)
Capital assets, being
depreciated, net 1,711,729 (750,124) 41,957 (42,166) 961,396
Capital assets, net -
Governmental Activities 43,480,026$ (908,289)$ 410,122$ (6,519,345)$ 36,462,514$
CITY OF PALM DESERT
NOTES TO BASIC FINANCIAL STATEMENTS
(CONTINUED)
June 30, 2016
- 111 -
18. SUCCESSOR AGENCY DISCLOSURES (CONTINUED):
Tax Allocation Bonds
A summary of changes in tax allocation bonds at June 30, 2016, was as follows:
Balance Additions/ Repayments/ Balance Due Within
July 1, 2015 Accretion Reductions June 30, 2016 One Year
Project Area No. 1
2002A TARRBs, $22,070,000 22,070,000$ -$ -$ 22,070,000$ -$
2003 TARBs, $19,000,000 12,660,000 - - 12,660,000 -
2004A TARRBs, $24,945,000 14,050,000 - (1,280,000) 12,770,000 1,335,000
2006 A & B TARBs, $62,320,000 40,855,000 - (3,075,000) 37,780,000 1,000,000
2007A TARRBs, $32,600,000 10,640,000 - (3,390,000) 7,250,000 3,570,000
Project Area No. 2
2002A TARRBs, $17,310,000 8,680,000 - (910,000) 7,770,000 955,000
2003 TARBs, $15,745,000 15,745,000 - - 15,745,000 -
2006 A-D TARBs, $67,618,213 54,744,520 973,442 (1,320,000) 54,397,962 1,500,000
Project Area No. 3
2003 TARBs, $4,745,000 3,450,000 - (125,000) 3,325,000 130,000
2006 A-C TABs, $15,059,526 15,660,598 281,132 (370,000) 15,571,730 415,000
Project Area No. 4
1998 TARBs, $11,020,000 7,445,000 - (375,000) 7,070,000 400,000
2001 TARBs, $15,695,000 12,165,000 - (390,000) 11,775,000 400,000
2006A TARBs, $19,243,089 18,099,223 376,147 (690,000) 17,785,370 105,000
Combined Low and
Moderate Housing
2002 TARBs, $12,100,000 8,800,000 - (345,000) 8,455,000 360,000
2007 TARBs, $86,155,000 55,940,000 - (5,785,000) 50,155,000 6,085,000
Subtotal 301,004,341 1,630,721 (18,055,000) 284,580,062 16,255,000
Add: Unamortized
bond premium 4,521,022 - (475,703) 4,045,319 -
Total 305,525,363$ 1,630,721$ (18,530,703)$ 288,625,381$ 16,255,000$
Tax Allocation bonds used for capital improvements are special obligations of the Agency and the
Financing Authority (a component unit of the Agency) and are secured by an irrevocable pledge of tax
revenues and other funds as provided under the Bond Resolution. The bonds and any interest thereon
are not a debt of the City, the State of California or any of its political subdivisions, and neither the
City, the State of California nor any of its political subdivisions is liable on the bonds, nor in any event
shall the bonds and interest thereon be payable out of any funds or properties other than those provided
under the Bond Resolution. The Agency purchased insurance from Ambac Assurance Corporation
(Ambac) and MBIA Insurance Corporation (MBIA) for the purpose of enhancing the creditworthiness
of the bonds.
CITY OF PALM DESERT
NOTES TO BASIC FINANCIAL STATEMENTS
(CONTINUED)
June 30, 2016
- 112 -
18. SUCCESSOR AGENCY DISCLOSURES (CONTINUED):
Tax Allocation Bonds (Continued)
There are unspent bond proceeds remaining with respect to each of the following series of tax
allocation bonds:
Project Area No. 1 Series 2006 A
Project Area No. 1 Series 2007
Project Area No. 2 Series 2006 A, B & D
Project Area No. 3 Series 2003
Project Area No. 3 Series 2006 A B & C
Project Area No. 4 Series 2001
Project Area No. 4 Series 2006 A & B
Housing Set Aside Series 2007
California Health and Safety Code Section 34177(i) requires SARDA’s to use bond proceeds for
the purposes for which bonds were sold unless the purposes can no longer be achieved, in which
case the proceeds may be used to defease the bonds. Pursuant to Section 34191.4, if the SARDA
receives a finding of completion from the DOF, which is predicated upon completion of a number
of required payments and transfer in furtherance of the wind down process under the Dissolution
Act, notwithstanding any other provision of law, bond proceeds derived from bonds issued on or
before December 31, 2010 that are in excess of the amounts needed to satisfy approved enforceable
obligations must thereafter be expended in a manner consistent with the original bond covenants
and may include the expenditure of funds to complete the projects that are the subject of the
enforceable obligations or the creation of reserves therefor. The SARDA received a finding of
completion in a letter dated May 15, 2013 from the DOF which allowed the SARDA to utilize
proceeds from bonds issued prior to January 1, 2011 in a manner consistent with the original bond
covenants.
CITY OF PALM DESERT
NOTES TO BASIC FINANCIAL STATEMENTS
(CONTINUED)
June 30, 2016
- 113 -
18. SUCCESSOR AGENCY DISCLOSURES (CONTINUED):
Tax Allocation Bonds (Continued)
On November 8, 2010, Ambac Financial Group, Inc. (“Ambac Group”), whose principal operating
subsidiary, Ambac Assurance Corporation, is a guarantor of public finance and structured finance
obligations, announced that it filed for a voluntary petition for relief under Chapter 11 of the United
States Bankruptcy Code (“Bankruptcy Code”) in the United States Bankruptcy Court for the Southern
District of New York (“Bankruptcy Court”). Ambac Group will continue to operate in the ordinary
course of business as “debtor-in-possession” under the jurisdiction of the Bankruptcy Court and in
accordance with the applicable provisions of the Bankruptcy Code and the orders of the Bankruptcy
Court. On May 1, 2013, Ambac Group completed its financial restructuring and emerged from
Chapter 11 bankruptcy.
On February 18, 2009, MBIA announced the restructuring of its financial guaranty insurance
operations into two separately capitalized sister companies, with one entity (MBIA Illinois) assuming
the risk associated with its US municipal exposures, and the other (MBIA Corp) insuring the remainder
of the portfolio. Effective March 19, 2009, MBIA Illinois was renamed National Public Finance
Guarantee Corporation (“NPFGC”).
The Redevelopment Plans for the Dissolved RDA’s project areas set forth certain limitations on the
maximum aggregate amount of tax increment that the Dissolved RDA could have received with
respect to each project area, or if applicable, each component area of the project area (each, a “TI
Cap”). Upon reaching the TI Cap, the Dissolved RDA would not be able to receive any additional
tax increment derived from the project area (or component area, as the case may be) to pay
outstanding debt. Based on projections done before the enactment of the Dissolution Act, the
Dissolved RDA expected that the TI Cap for the Amended Territory of Project Area No. 1 would
be reached around fiscal year 2021-22, before the final maturity date of the bonds issued for
Project Area No. 1. The Dissolved RDA had planned and expected to use excess tax increment
from Project Area No. 1 to call bonds before reaching the TI Cap to avoid any bond defaults.
Pursuant to SB 107 (adopted in September 2015), Section 34189(a) of the Dissolution Act has been
amended, clarifying that the SARDA is not subject to the TI Cap for the purposes of the payments
of bonds or any other enforceable obligations (except where the contract for the enforceable
obligation specifies that the funding for such project would cease once such limitation was
realized).
CITY OF PALM DESERT
NOTES TO BASIC FINANCIAL STATEMENTS
(CONTINUED)
June 30, 2016
- 114 -
18. SUCCESSOR AGENCY DISCLOSURES (CONTINUED):
Tax Allocation Bonds (Continued)
2002 Series A Tax Allocation Refunding Revenue Bonds (Project Area No. 1, as amended)
On March 13, 2002, the Palm Desert Financing Authority issued $22,070,000 of Tax Allocation
Refunding Revenue Bonds (Project Area No. 1, as amended) 2002 Series A. The proceeds from the
bonds were loaned to the Dissolved RDA. A portion of the proceeds of the loan was used to prepay
the prior loan, which affected the current refunding of a like portion of the prior bonds. The
remainder was used to fund various redevelopment capital projects of the Agency in Project Area
No. 1. The bonds consist of $10,905,000 term bonds at 5.00% due April 1, 2025, and $11,165,000
term bonds at 5.10% due April 1, 2030. Interest is payable semi-annually on April 1 and October 1.
Mandatory sinking fund redemptions begin April 1, 2024.
The future debt service requirements on the 2002 Series A Tax Allocation Refunding Revenue
Bonds (Project Area No. 1, as amended) are as follows:
Year Ending
June 30, Principal Interest Total
2017 -$ 1,114,665$ 1,114,665$
2018 - 1,114,665 1,114,665
2019 - 1,114,665 1,114,665
2020 - 1,114,665 1,114,665
2021 - 1,114,665 1,114,665
2022 - 2026 12,920,000 4,789,075 17,709,075
2027 - 2030 9,150,000 1,195,440 10,345,440
22,070,000$ 11,557,840$ 33,627,840$
CITY OF PALM DESERT
NOTES TO BASIC FINANCIAL STATEMENTS
(CONTINUED)
June 30, 2016
- 115 -
18. SUCCESSOR AGENCY DISCLOSURES (CONTINUED):
Tax Allocation Bonds (Continued)
2003 Series Tax Allocation Revenue Bonds (Project Area No. 1)
On August 5, 2003, the Financing Authority issued $19,000,000 Tax Allocation Revenue Bonds
(Project Area No. 1, as amended) 2003 Series. The proceeds of the bonds were disbursed to make a
loan to the Dissolved RDA. The proceeds from the bonds were loaned to fund various
redevelopment capital projects and to finance costs of issuance of the bonds. The bonds bear
interest at 5.0%. They consist of $7,050,000 serial bonds with principal payments due in 2026 and
2027, and $11,950,000 term bonds due in 2030. Interest will be payable on April 1 and October 1
of each year beginning April 1, 2004. Principal payments will be on April 1 of the years stated
above.
The future debt service requirements on the 2003 Series Tax Allocation Revenue Bonds (Project
Area No. 1) are as follows:
Year Ending
June 30, Principal Interest Total
2017 -$ 633,000$ 633,000$
2018 - 633,000 633,000
2019 - 633,000 633,000
2020 - 633,000 633,000
2021 - 633,000 633,000
2022 - 2026 2,295,000 3,165,000 5,460,000
2027 - 2030 10,365,000 1,327,250 11,692,250
12,660,000$ 7,657,250$ 20,317,250$
CITY OF PALM DESERT
NOTES TO BASIC FINANCIAL STATEMENTS
(CONTINUED)
June 30, 2016
- 116 -
18. SUCCESSOR AGENCY DISCLOSURES (CONTINUED):
Tax Allocation Bonds (Continued)
2004 Series A Tax Allocation Refunding Revenue Bonds (Project Area No. 1, as amended)
On June 24, 2004, the Palm Desert Financing Authority issued $24,945,000 of Tax Allocation
Refunding Revenue Bonds (Project Area No. 1, as amended) 2004 Series A. The proceeds from the
bonds were loaned to the Dissolved RDA to refinance a portion of the Agency’s obligations from
1995, and to fund various redevelopment capital projects within or of benefit to the project area.
Interest rates on the bonds vary from 3.0% to 5.0% per annum payable semi-annually on April 1
and October 1. Principal payments will be made annually beginning April 1, 2005.
The future debt service requirements on the 2004 Series A Tax Allocation Revenue Bonds (Project
Area No. 1, as amended) are as follows:
Year Ending
June 30, Principal Interest Total
2017 1,335,000$ 618,500$ 1,953,500$
2018 1,460,000 558,425 2,018,425
2019 1,420,000 490,900 1,910,900
2020 1,520,000 419,900 1,939,900
2021 1,620,000 347,700 1,967,700
2022 - 2025 5,415,000 695,500 6,110,500
12,770,000$ 3,130,925$ 15,900,925$
CITY OF PALM DESERT
NOTES TO BASIC FINANCIAL STATEMENTS
(CONTINUED)
June 30, 2016
- 117 -
18. SUCCESSOR AGENCY DISCLOSURES (CONTINUED):
Tax Allocation Bonds (Continued)
Tax Allocation Revenue Bonds (Project Area No. 1, as Amended) 2006 Series A and Series B
(Taxable)
On July 6, 2006, the Palm Desert Financing Authority issued $37,780,000 of Tax Allocation
Revenue Bonds (Project Area No. 1, as Amended) 2006 Series A and $24,540,000 of Tax
Allocation Refunding Revenue Bonds (Project Area No. 1, as Amended) 2006 Series B (Taxable).
The Palm Desert Financing Authority loaned the bond proceeds to the Dissolved RDA. The
proceeds of the Series A were loaned to assist the Agency to fund various redevelopment capital
projects within or of benefit to Project Area No. 1, as Amended, pay costs of issuance and pay the
premium on a Reserve Fund surety bond. The proceeds of the Series B were loaned to refinance
the Agency’s obligations incurred under a loan agreement entered into in 1997, pay costs of
issuance and pay the premium on a Reserve Fund surety bond. The Series A bonds consist of
$26,415,000 Serial Bonds with interest rates ranging from 4.70% to 5.25% payable semiannually
on October 1 and April 1. Bond maturities begin April 1, 2017, and continue annually
through 2030. Term bonds in the amount of $11,365,000 carry an interest rate of 5.00% and
mature April 1, 2022. The Series B bonds consist of $13,220,000 Serial Bonds with interest rates
ranging from 5.56% to 5.77% payable semiannually on October 1 and April 1. Bond maturities
began April 1, 2007, and continue annually through 2012. Term bonds in the amount of
$11,320,000 carry an interest rate of 5.82% and matured on April 1, 2016.
The future debt service requirements on the 2006 Series A and Series B Tax Allocation Revenue
Bonds (Project Area No. 1, as amended) are as follows:
Year Ending
June 30, Principal Interest Total
2017 1,000,000$ 1,914,445$ 2,914,445$
2018 1,005,000 1,864,445 2,869,445
2019 5,065,000 1,811,683 6,876,683
2020 5,285,000 1,545,770 6,830,770
2021 5,540,000 1,268,308 6,808,308
2022 - 2026 18,810,000 2,492,038 21,302,038
2027 - 2030 1,075,000 130,478 1,205,478
37,780,000$ 11,027,167$ 48,807,167$
CITY OF PALM DESERT
NOTES TO BASIC FINANCIAL STATEMENTS
(CONTINUED)
June 30, 2016
- 118 -
18. SUCCESSOR AGENCY DISCLOSURES (CONTINUED):
Tax Allocation Bonds (Continued)
Tax Allocation Refunding Revenue Bonds (Project Area No. 1, as amended) 2007 Series A
On January 9, 2007, the Palm Desert Financing Authority issued $32,600,000 Tax Allocation
Refunding Revenue Bonds (Project Area No. 1, as amended) 2007 Series A. The Palm Desert
Financing Authority loaned the bond proceeds to the Dissolved RDA. The proceeds of the bond
were loaned to refinance a portion of the outstanding obligations of the Dissolved RDA, fund
various redevelopment capital projects within Project Area No. 1, as amended, and pay the costs
associated with the issuance of the bonds. The Series A bonds consist of $32,600,000 Serial Bonds
with interest rates ranging from 3.50% to 5.00% payable semiannually on October 1 and April 1.
Bond maturities began April 1, 2008, and continue annually through 2018.
The future debt service requirements on the 2007 Series A Tax Allocation Refunding Revenue
Bonds (Project Area No. 1, as amended) are as follows:
Year Ending
June 30, Principal Interest Total
2017 3,570,000$ 362,500$ 3,932,500$
2018 3,680,000 184,000 3,864,000
7,250,000$ 546,500$ 7,796,500$
CITY OF PALM DESERT
NOTES TO BASIC FINANCIAL STATEMENTS
(CONTINUED)
June 30, 2016
- 119 -
18. SUCCESSOR AGENCY DISCLOSURES (CONTINUED):
Tax Allocation Bonds (Continued)
2002 Series A Tax Allocation Refunding Revenue Bonds (Project Area No. 2)
On July 11, 2002, the Palm Desert Financing Authority issued $17,310,000 of Tax Allocation
Refunding Revenue Bonds (Project Area No. 2) 2002 Series A. The Palm Desert Financing
Authority loaned the bond proceeds to the Dissolved RDA to prepay outstanding indebtedness and
to fund various redevelopment capital projects within or of benefit to the project area. Interest rates
on the bonds vary from 3.0% to 5.0% per annum payable semi-annually on February 1 and
August 1.
The future debt service requirements on the 2002 Series A Tax Allocation Refunding Revenue
Bonds (Project Area No. 2) are as follows:
Year Ending
June 30, Principal Interest Total
2017 955,000$ 355,403$ 1,310,403$
2018 995,000 309,806 1,304,806
2019 1,050,000 261,238 1,311,238
2020 1,100,000 209,900 1,309,900
2021 1,160,000 154,500 1,314,500
2022 - 2023 2,510,000 126,750 2,636,750
7,770,000$ 1,417,597$ 9,187,597$
CITY OF PALM DESERT
NOTES TO BASIC FINANCIAL STATEMENTS
(CONTINUED)
June 30, 2016
- 120 -
18. SUCCESSOR AGENCY DISCLOSURES (CONTINUED):
Tax Allocation Bonds (Continued)
2003 Series Tax Allocation Revenue Bonds (Project Area No. 2)
On March 26, 2003, the Palm Desert Financing Authority issued $15,745,000 of Tax Allocation
Revenue Bonds (Project Area No. 2) 2003 Series. The Palm Desert Financing Authority loaned the
bond proceeds to the Dissolved RDA to fund various redevelopment capital projects in Project
Area No. 2. Interest rates on the bonds vary from 4.5% to 5.0% per annum payable semi-annually
on February 1 and August 1, with principal maturing as follows:
$ 875,000 Serial Bonds August 1, 2023
910,000 Serial Bonds August 1, 2024
2,485,000 Term Bonds August 1, 2026
11,475,000 Term Bonds August 1, 2033
The future debt service requirements on the 2003 Series Tax Allocation Revenue Bonds (Project
Area No. 2) are as follows:
Year Ending
June 30, Principal Interest Total
2017 -$ 769,006$ 769,006$
2018 - 769,006 769,006
2019 - 769,006 769,006
2020 - 769,006 769,006
2021 - 769,006 769,006
2022 - 2026 2,930,000 3,658,691 6,588,691
2027 - 2031 7,400,000 2,312,488 9,712,488
2022 - 2034 5,415,000 415,125 5,830,125
15,745,000$ 10,231,334$ 25,976,334$
CITY OF PALM DESERT
NOTES TO BASIC FINANCIAL STATEMENTS
(CONTINUED)
June 30, 2016
- 121 -
18. SUCCESSOR AGENCY DISCLOSURES (CONTINUED):
Tax Allocation Bonds (Continued)
Project Area No. 2 Tax Allocation Refunding Revenue Bonds 2006 Series A, Tax Allocation
Revenue Capital Appreciation Bonds 2006 Series B, Revenue Bonds 2006 Series C and
Subordinate Tax Allocation Revenue Capital Appreciation Bonds 2006 Series D
On July 25, 2006, the Palm Desert Financing Authority issued its Project Area No. 2 $41,340,000
Tax Allocation Refunding Revenue Bonds 2006 Series A, $1,567,118 Tax Allocation Revenue
Capital Appreciation Bonds 2006 Series B, $7,775,000 Tax Allocation Revenue Bonds 2006
Series C and $16,936,095 Subordinate Tax Allocation Revenue Capital Appreciation Bonds 2006
Series D. The Palm Desert Financing Authority loaned the bond proceeds to the Dissolved RDA.
The proceeds of the Series A, B and C Bonds were loaned to refinance the Agency’s obligations
incurred under a loan agreement entered into in 1995, fund various redevelopment capital projects
within or of benefit to its Project Area No. 2 Reserve Fund surety and pay costs of issuance of the
bonds. The proceeds of the Series D Bonds were loaned to fund various redevelopment capital
projects within or of benefit to the Project Area, fund a debt service reserve fund and pay cost of
issuance of the bonds.
The Series A bonds consist of $16,250,000 Serial Bonds with interest rates ranging from 4.00% to
5.00% payable semiannually on August 1 and February 1. Bond maturities begin August 1, 2007,
and continue annually through 2026. Term bonds in the amount of $8,225,000 carry an interest
rate of 4.90% and mature August 1, 2031. Term bonds in the amount of $16,865,000 carry an
interest rate of 5.125% and mature August 1, 2036. The Series B bonds consist of $1,567,118
Capital Appreciation Bonds with a reoffering yield ranging from 3.85% to 4.08%. Bond maturities
begin April 1, 2007, and continue annually through 2010. The Series C bonds have been paid off..
The Series D bonds consist of $16,936,095 Capital Appreciation Bonds with a reoffering yield
ranging from 4.65% to 6.10%. Bond maturities began August 1, 2007, and continue annually
through 2035. Each year the outstanding balance is increased for the accretion of interest
associated with the bonds. The accreted interest at June 30, 2016 is $7,532,851.
CITY OF PALM DESERT
NOTES TO BASIC FINANCIAL STATEMENTS
(CONTINUED)
June 30, 2016
- 122 -
18. SUCCESSOR AGENCY DISCLOSURES (CONTINUED):
Tax Allocation Bonds (Continued)
Project Area No. 2 Tax Allocation Refunding Revenue Bonds 2006 Series A, Tax Allocation
Revenue Capital Appreciation Bonds 2006 Series B, Revenue Bonds 2006 Series C and
Subordinate Tax Allocation Revenue Capital Appreciation Bonds 2006 Series D (Continued)
The debt service requirements schedules on the 2006 Series A Tax Allocation Refunding Revenue
Bonds, Series B Tax Allocation Revenue Capital Appreciation Bonds, Series C Revenue Bonds
and Series D Subordinate Tax Allocation Revenue Capital Appreciation Bonds (Project Area
No. 2) do not agree to the liability for those bonds shown in the schedule of changes. These bond
issues include capital appreciation bonds, which are issued at a discount. The carrying amount of
these bonds accretes, or increases each year. The amount shown in the schedule of changes
include the accreted value to date. The future debt service requirements are as follows:
Year Ending
June 30, Principal Interest Total
2017 1,208,650$ 2,104,238$ 3,312,888$
2018 1,299,414 2,172,011 3,471,425
2019 1,362,179 2,238,134 3,600,313
2020 1,436,998 2,309,614 3,746,612
2021 1,498,801 2,387,423 3,886,224
2022 - 2026 9,749,415 13,123,694 22,873,109
2027 - 2031 9,974,569 11,466,626 21,441,195
2032 - 2036 15,790,085 10,142,454 25,932,539
2037 4,545,000 116,466 4,661,466
46,865,111$ 46,060,660$ 92,925,771$
2003 Series Tax Allocation Revenue Bonds (Project Area No. 3)
On August 5, 2003, the Financing Authority issued $4,745,000 of Tax Allocation Revenue Bonds
(Project Area No. 3) 2003 Series. The proceeds of the bonds were disbursed to make a loan to the
Dissolved RDA. The proceeds of the bond were loaned to fund various redevelopment capital
projects within or of benefit to the project area and to finance costs of issuance of the bonds. The
bonds bear interest at rates ranging from 3.000% to 5.125%. Principal maturities for the serial
bonds of $2,475,000 began April 1, 2004, and continue through October 1, 2031. The term bonds
in the amount of $2,270,000 are due in 2033.
CITY OF PALM DESERT
NOTES TO BASIC FINANCIAL STATEMENTS
(CONTINUED)
June 30, 2016
- 123 -
18. SUCCESSOR AGENCY DISCLOSURES (CONTINUED):
Tax Allocation Bonds (Continued)
2003 Series Tax Allocation Revenue Bonds (Project Area No. 3) (Continued)
The future debt service requirements on the 2003 Series Tax Allocation Revenue Bonds (Project
Area No. 3) are as follows:
Year Ending
June 30, Principal Interest Total
2017 130,000$ 163,348$ 293,348$
2018 140,000 157,888 297,888
2019 145,000 151,868 296,868
2020 150,000 145,560 295,560
2021 155,000 138,885 293,885
2022 - 2026 905,000 576,900 1,481,900
2027 - 2031 1,155,000 322,875 1,477,875
2032 - 2033 545,000 42,281 587,281
3,325,000$ 1,699,605$ 5,024,605$
Project Area No. 3 Tax Allocation Revenue Bonds 2006 Series A, Tax Allocation Revenue Capital
Appreciation Bonds 2006 Series B and Subordinate Tax Allocation Revenue Capital Appreciation
Bonds 2006 Series C
On July 25, 2006, the Palm Desert Financing Authority issued its Project Area No. 3 $11,915,000
Tax Allocation Revenue Bonds 2006 Series A, $383,660 Tax Allocation Revenue Capital
Appreciation Bonds 2006 Series B and $2,760,866 Subordinate Tax Allocation Revenue Capital
Appreciation Bonds 2006 Series C. The Palm Desert Financing Authority loaned the bond
proceeds to the Dissolved RDA. The proceeds of the Series A and B Bonds were loaned to fund
various redevelopment capital projects within or of benefit to its Project Area No. 3, purchase a
Reserve Fund surety policy and pay the costs of issuance of the bonds. The proceeds of the
Series C Bonds were loaned to fund various redevelopment capital projects within or of benefit to
the Project Area, fund a debt service reserve fund and pay the costs of issuance of the bonds.
CITY OF PALM DESERT
NOTES TO BASIC FINANCIAL STATEMENTS
(CONTINUED)
June 30, 2016
- 124 -
18. SUCCESSOR AGENCY DISCLOSURES (CONTINUED):
Tax Allocation Bonds (Continued)
Project Area No. 3 Tax Allocation Revenue Bonds 2006 Series A, Tax Allocation Revenue Capital
Appreciation Bonds 2006 Series B and Subordinate Tax Allocation Revenue Capital Appreciation
Bonds 2006 Series C (Continued)
The Series A bonds consist of $2,980,000 Serial Bonds with interest rates ranging from 4.00% to
4.75% payable semiannually on April 1 and October 1. Bond maturities begin April 1, 2007, and
continue annually through 2025. Term bonds in the amount of $4,465,000 carry an interest rate of
4.75% and mature April 1, 2036. Term bonds in the amount of $4,470,000 carry an interest rate of
5.00% and mature April 1, 2041. The Series B bonds consist of $383,660 Capital Appreciation
Bonds with a yield ranging from 5.31% to 5.54%. Bond maturities are April 1, 2020, 2021, 2027
and 2028. The Series C bonds consist of $2,760,866 Capital Appreciation Bonds with a yield
ranging from 4.80% to 6.10%. Bond maturities began April 1, 2009, and continue annually
through 2034. Each year the outstanding balance is increased for the accretion of interest
associated with the bonds. The accreted interest at June 30, 2016 is $2,138,467.
The future debt service requirements on the 2006 Series A Tax Allocation Revenue Bonds,
Series B Tax Allocation Revenue Capital Appreciation Bonds and Series C Subordinate Tax
Allocation Revenue Capital Appreciation Bonds (Project Area No. 3) are as follows:
Year Ending
June 30, Principal Interest Total
2017 329,787$ 601,495$ 931,282$
2018 344,954 616,977 961,931
2019 369,116 632,690 1,001,806
2020 260,602 780,405 1,041,007
2021 258,889 817,117 1,076,006
2022 - 2026 2,095,724 3,646,626 5,742,350
2027 - 2031 1,981,030 4,209,408 6,190,438
2032 - 2036 3,323,161 2,977,188 6,300,349
2037 - 2041 4,470,000 692,250 5,162,250
13,433,263$ 14,974,156$ 28,407,419$
CITY OF PALM DESERT
NOTES TO BASIC FINANCIAL STATEMENTS
(CONTINUED)
June 30, 2016
- 125 -
18. SUCCESSOR AGENCY DISCLOSURES (CONTINUED):
Tax Allocation Bonds (Continued)
1998 Series Tax Allocation Revenue Bonds (Project Area No. 4)
On March 1, 1998, the Palm Desert Financing Authority issued $11,020,000 of Tax Allocation
Revenue Bonds (Project Area No. 4) 1998 Series. The proceeds from the bonds were loaned to the
Dissolved RDA to fund various redevelopment capital projects in Project Area No. 4. Interest rates
on the bonds vary from 4.0% to 5.2% per annum payable semi-annually on April 1 and October 1,
with principal maturing annually on October 1. In July 2006, $1,785,000 of the outstanding
balance was advance refunded by the issuance of Tax Allocation Refunding Revenue Bonds
(Project Area No. 4) 2006 Series A.
The future debt service requirements on the 1998 Series Tax Allocation Revenue Bonds (Project
Area No. 4) (after defeasance) are as follows:
Year Ending
June 30, Principal Interest Total
2017 400,000$ 356,678$ 756,678$
2018 410,000 336,005 746,005
2019 430,000 314,340 744,340
2020 455,000 291,330 746,330
2021 480,000 267,020 747,020
2022 - 2026 2,825,000 920,010 3,745,010
2027 - 2029 2,070,000 165,100 2,235,100
7,070,000$ 2,650,483$ 9,720,483$
CITY OF PALM DESERT
NOTES TO BASIC FINANCIAL STATEMENTS
(CONTINUED)
June 30, 2016
- 126 -
18. SUCCESSOR AGENCY DISCLOSURES (CONTINUED):
Tax Allocation Bonds (Continued)
2001 Series Tax Allocation Revenue Bonds (Project Area No. 4)
On November 28, 2001, the Palm Desert Financing Authority issued $15,695,000 of Tax
Allocation Revenue Bonds (Project Area No. 4) 2001 Series. The proceeds from the bonds were
loaned to the Dissolved RDA to fund various redevelopment capital projects in Project Area No. 4.
Interest rates on the bonds vary from 3.5% to 4.8% per annum payable semi-annually on April 1
and October 1, with principal maturing annually on October 1.
The future debt service requirements on the 2001 Series Tax Allocation Revenue Bonds (Project
Area No. 4) are as follows:
Year Ending
June 30, Principal Interest Total
2017 400,000$ 549,825$ 949,825$
2018 435,000 531,073 966,073
2019 450,000 510,940 960,940
2020 475,000 489,691 964,691
2021 490,000 467,375 957,375
2022 - 2026 2,785,000 1,962,194 4,747,194
2027 - 2031 5,090,000 1,136,160 6,226,160
2032 1,650,000 39,600 1,689,600
11,775,000$ 5,686,858$ 17,461,858$
CITY OF PALM DESERT
NOTES TO BASIC FINANCIAL STATEMENTS
(CONTINUED)
June 30, 2016
- 127 -
18. SUCCESSOR AGENCY DISCLOSURES (CONTINUED):
Tax Allocation Bonds (Continued)
Tax Allocation Refunding Revenue Bonds (Project Area No. 4) 2006 Series A and Tax Allocation
Revenue Capital Appreciation Bonds (Project Area No. 4) Series B
On July 25, 2006, the Palm Desert Financing Authority issued $14,610,000 of Tax Allocation
Refunding Revenue Bonds (Project Area No. 4) 2006 Series A and $4,633,089 of Tax Allocation
Revenue Capital Appreciation Bonds (Project Area No. 4) 2006 Series B. The Palm Desert
Financing Authority loaned the bond proceeds to the Dissolved RDA. The proceeds of the Series A
and B Bonds were loaned to refinance a portion of the outstanding obligations under a loan
agreement dated March 1, 1998, fund various redevelopment capital projects within or of benefit to
its Project Area No. 4, purchase a Reserve Fund surety policy and pay the costs of issuance of the
bonds. The Series A bonds consist of $8,155,000 Serial Bonds with interest rates ranging from
4.40% to 5.00% payable semiannually on October 1 and April 1. Bond maturities began
October 1, 2008, and continue annually through 2026. Term bonds in the amount of $2,200,000
carry an interest rate of 5.00% and mature October 1, 2029. Term bonds in the amount of
$4,255,000 carry an interest rate of 5.00% and mature October 1, 2034. The Series B bonds consist
of $4,663,089 Capital Appreciation Bonds with a yield ranging from 4.14% to 5.56%. Bond
maturities begin October 1, 2009, and continue annually through 2034. Each year the outstanding
balance is increased for the accretion of interest associated with the bonds. The accreted interest at
June 30, 2016 is $2,968,030.
The future debt service requirements on the 2006 Series A Tax Allocation Refunding Bonds and
Series B Tax Allocation Revenue Capital Appreciation Bonds (Project Area No. 4) are as follows:
Year Ending
June 30, Principal Interest Total
2017 65,619$ 549,951$ 615,570$
2018 106,490 589,080 695,570
2019 270,000 504,630 774,630
2020 338,168 528,923 867,091
2021 293,053 664,656 957,709
2022 - 2026 3,290,861 2,901,973 6,192,834
2027 - 2031 4,339,749 4,177,361 8,517,110
2032 - 2035 6,113,400 7,572,348 13,685,748
14,817,340$ 17,488,922$ 32,306,262$
CITY OF PALM DESERT
NOTES TO BASIC FINANCIAL STATEMENTS
(CONTINUED)
June 30, 2016
- 128 -
18. SUCCESSOR AGENCY DISCLOSURES (CONTINUED):
Tax Allocation Bonds (Continued)
2002 Series Tax Allocation (Housing Set-Aside) Revenue Bonds
On September 5, 2002, the Palm Desert Financing Authority issued $12,100,000 of Tax Allocation
(Housing Set-Aside) Revenue Bonds 2002 Series. The Palm Desert Financing Authority loaned the
bond proceeds to the Dissolved RDA to fund various low and moderate housing capital projects of
the Agency and to finance costs of issuance of the bonds. Interest rates on the $6,555,000 serial
bonds vary from 2.0% to 4.9% per annum payable semi-annually on March 1 and October 1.
Annual principal payments began October 1, 2003. The $5,545,000 term bonds bear an interest rate
of 5.0% per annum and mature October 1, 2031.
The future debt service requirements on the 2002 Series Tax Allocation (Housing Set-Aside)
Revenue Bonds are as follows:
Year Ending
June 30, Principal Interest Total
2017 360,000$ 404,019$ 764,019$
2018 375,000 388,029 763,029
2019 395,000 370,891 765,891
2020 415,000 352,407 767,407
2021 435,000 332,588 767,588
2022 - 2026 2,510,000 1,316,333 3,826,333
2027 - 2031 3,220,000 605,000 3,825,000
2032 745,000 18,625 763,625
8,455,000$ 3,787,892$ 12,242,892$
CITY OF PALM DESERT
NOTES TO BASIC FINANCIAL STATEMENTS
(CONTINUED)
June 30, 2016
- 129 -
18. SUCCESSOR AGENCY DISCLOSURES (CONTINUED):
Tax Allocation Bonds (Continued)
Tax Allocation (Housing Set-Aside) Refunding Revenue Bonds Series 2007
On February 7, 2007, the Palm Desert Financing Authority issued $86,155,000 Tax Allocation
(Housing Set-Aside) Refunding Revenue Bonds Series 2007. The Palm Desert Financing
Authority loaned the proceeds to the Dissolved RDA. The proceeds of the bonds were loaned to
finance the development of low and moderate income housing of the Agency, refinance a portion
of the outstanding obligations of the Dissolved RDA, purchase a debt service surety bond for
deposit in the Reserve Fund, and pay certain costs associated with the issuance of the bonds. The
Series 2007 bonds consist of $86,155,000 Serial Bonds with interest ranging from 4.00% to 5.00%
payable semiannually on October 1 and April 1. Bond maturities began October 1, 2007, and
continue annually through 2027.
The future debt service requirements on the Tax Allocation (Housing Set-Aside) Refunding
Revenue Bonds Series 2007 are as follows:
Year Ending
June 30, Principal Interest Total
2017 6,085,000$ 2,234,563$ 8,319,563$
2018 6,395,000 1,922,563 8,317,563
2019 6,720,000 1,594,688 8,314,688
2020 7,065,000 1,250,063 8,315,063
2021 2,525,000 1,010,313 3,535,313
2022 - 2026 14,560,000 3,135,363 17,695,363
2027 - 2028 6,805,000 292,294 7,097,294
50,155,000$ 11,439,847$ 61,594,847$
CITY OF PALM DESERT
NOTES TO BASIC FINANCIAL STATEMENTS
(CONTINUED)
June 30, 2016
- 130 -
19. EXTRAORDINARY ITEM:
The Successor Agency transferred $72,138,669 in bond proceeds to the City’s Capital Properties
Capital Projects Fund in the amount of $65,566,963 and to the Low and Moderate Income Housing
Assets Special Revenue Fund in the amount of $6,571,706 after receiving approval as required by
the dissolution process from the Oversight Board of the Successor Agency and the California
Department of Finance. These amounts are reported as an extraordinary loss in the Successor
Agency’s and an extraordinary gain in the City’s financial statements.
20. SUBSEQUENT EVENTS:
Events occurring after June 30, 2016, have been evaluated for possible adjustments to the financial
statements or disclosure as of December 16, 2016, which is the date these financial statements were
available to be issued.
-131 -
REQUIRED SUPPLEMENTARY INFORMATION
Schedule 1
Fiscal Year Ended June 30, 2016 June 30, 2015
Measurement Date June 30, 2015 June 30, 2014
Total Pension Liability:
Service cost 2,125,437$ 2,156,598$
Interest on total pension liability 8,223,320 7,991,591
Differences between expected and actual experience (2,378,254) -
Changes in assumptions (2,091,348) -
Changes in benefits - -
Benefit payments, including refunds of employee contributions (4,597,025) (4,849,320)
Net Change in Total Pension Liability 1,282,130 5,298,869
Total Pension Liability - Beginning of Year 113,199,769 107,900,900
Total Pension Liability - End of Year (a)114,481,899$ 113,199,769$
Plan Fiduciary Net Position:
Contributions - employer 4,065,411$ 3,320,450$
Contributions - employee 878,171 995,504
Net investment income 1,682,498 11,290,314
Administrative expense (87,279) -
Benefit payments (4,597,025) (4,849,320)
Net Change in Plan Fiduciary Net Position 1,941,776 10,756,948
Plan Fiduciary Net Position - Beginning of Year 75,608,498 64,851,550
Plan Fiduciary Net Position - End of Year (b)77,550,274$ 75,608,498$
Net Pension Liability - Ending (a)-(b)36,931,625$ 37,591,271$
Plan fiduciary net position as a percentage of the
total pension liability 67.74%66.79%
Covered - employee payroll 11,021,835$ 11,110,759$
Net pension liability as percentage of
covered- employee payroll 335.08%338.33%
Notes to Schedule:
Benefit Changes:
There were no changes in benefits.
Changes in Assumptions:
* - Fiscal year 2015 was the 1st year of implementation, therefore only two years are shown.
CITY OF PALM DESERT
SCHEDULE OF CHANGES IN THE NET PENSION LIABILITY AND RELATED RATIOS
Last Ten Fiscal Years*
- 132 -
GASB 68,paragraph 68 states that the long-term expected rate of return should be determined net of pension plan
investment expense but without reduction for pension plan administrative expense.The discount rate of 7.50%used for
the June 30,2014 measurement date was net of administrative expenses.The discount rate of 7.65%used for the June 30,
2015 measurement date is without reduction of pension plan administrative expense.
Schedule 2
Fiscal Year Ended June 30, 2016 June 30, 2015
Actuarially determined contribution 3,587,858$ 3,393,041$
Contributions in relation to the actuarially determined contributions (4,260,098) (4,065,281)
Contribution deficiency (excess)(672,240)$ (672,240)$
Covered - employee payroll 11,024,255$ 11,021,835$
Contributions as a percentage of covered - employee payroll 38.64%36.88%
Notes to Schedule:
Valuation Date June 30, 2013 June 30, 2012
Methods and Assumptions Used to Determine Contribution Rates:
Single and agent employers Entry age**
Amortization method Level percentage of payroll, closed**
Asset valuation method 15 year smoothed market***
Inflation 2.75%**
Salary increases Depending on age, service and type of employment**
Investment rate of return 7.50%, net of pension plan investment expense, including inflation**
Retirement age 50 years 2.7%@55 and 52 years 2%@62**
Mortality
* - Fiscal year 2015 was the 1st year of implementation, therefore only two years are shown.
** - The valuation for June 30, 2012 (applicable to fiscal year ended June 30, 2015) included the same actuarial assumptions.
*** - The valuation for June 30, 2012 (applicable to fiscal year ended June 30, 2015) valued assets using a 15 Year
Smoothed Market method.
CITY OF PALM DESERT
SCHEDULE OF CONTRIBUTIONS - DEFINED BENEFIT PENSION PLAN
Last Ten Fiscal Years*
- 133 -
Morality assumptions are based on mortality rates resulting from the most recent
CalPERS Experience Study adopted by the CalPERS Board,first used in the
June 30,2009 valuation.For purposes of the post-retirement mortality rates,
those revised rates include 5 years of projected on-going mortality improvement
using Scale AA published by the Society of Actuaries until June 30,2010.There
is no margin for future mortality improvement beyond the valuation date.**
Schedule 3
Actuarial Actuarial
Accrued Value Unfunded UAAL as a
Actuarial Liability of Assets AAL Funded Covered % of Covered
Valuation (AAL) (AVA) (UAAL) Ratio Payroll Payroll
Date (a) (b) (a) - (b) (b)/(a) (c) [(a)-(b)]/(c)
07/01/07 6,481,631$ -$ 6,481,631$ 0.00% 13,800,864$ 46.97%
07/01/09 8,230,029 6,916,360 1,313,669 84.04% 12,449,000 10.55%
06/30/11 9,854,151 8,986,749 867,402 91.20% 11,416,000 7.60%
06/30/13 11,234,217 9,709,457 1,524,760 86.43% 9,667,000 15.77%
06/30/15 14,772,913 11,263,676 3,509,237 76.25% 10,974,000 31.98%
For the year ended June 30, 2016
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OTHER POST-EMPLOYMENT BENEFITS PLAN
CITY OF PALM DESERT
SCHEDULE OF FUNDING PROGRESS -
Schedule 4
Variance with
Final Budget
Actual Positive
Original Final Amounts (Negative)
Fund balance, July 1 79,810,669$ 79,810,669$ 79,810,669$ -$
Resources (inflows):
Taxes 44,790,000 47,046,000 47,154,025 108,025
Licenses and permits 1,512,000 1,512,000 1,366,784 (145,216)
Intergovernmental revenues 1,688,000 1,688,000 1,991,678 303,678
Rental income 170,000 170,000 154,675 (15,325)
Charges of services 1,164,000 1,164,000 1,317,540 153,540
Fines and forfeitures 135,000 135,000 142,645 7,645
Investment earnings 330,000 697,500 725,015 27,515
Miscellaneous 536,000 536,000 585,546 49,546
Transfers from other funds 1,400,000 1,400,000 1,390,258 (9,742)
Total resources 51,725,000 54,348,500 54,828,166 479,666
Charges to appropriations (outflows):
Current:
General government 13,957,144 15,552,460 14,197,748 1,354,712
Public safety 22,574,825 22,602,848 22,039,527 563,321
Public works 7,287,921 8,508,681 7,463,107 1,045,574
Parks, recreation and culture 3,993,739 4,461,947 4,018,383 443,564
Capital outlay - 415,500 415,487 13
Transfers to other funds 3,900,000 4,182,000 4,141,928 40,072
Total charges to appropriations 51,713,629 55,723,436 52,276,180 3,447,256
Excess of resources over (under)
charges to appropriations 11,371 (1,374,936) 2,551,986 3,926,922
Fund balance, June 30 79,822,040$ 78,435,733$ 82,362,655$ 3,926,922$
See accompanying note to required supplementary information.
CITY OF PALM DESERT
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For the year ended June 30, 2016
Budgeted Amounts
BUDGETARY COMPARISON SCHEDULE
GENERAL FUND
Schedule 5
Variance with
Final Budget
Actual Positive
Original Final Amounts (Negative)
Fund balance, July 1 1,806,938$ 1,806,938$ 1,806,938$ -$
Resources (inflows):
Taxes 5,300,000 5,300,000 5,762,095 462,095
Special assessments collected 2,200,000 2,200,000 2,114,877 (85,123)
Intergovernmental revenues 940,000 940,000 996,598 56,598
Investment earnings 4,000 4,000 12,556 8,556
Miscellaneous 10,000 10,000 23,692 13,692
Transfers in 3,000,000 3,000,000 3,000,000 -
Total resources 11,454,000 11,454,000 11,909,818 455,818
Charges to appropriations (outflows):
Current:
Public safety 11,830,405 11,845,405 11,412,855 432,550
Capital outlay 51,300 51,300 1,601 49,699
Total charges to appropriations 11,881,705 11,896,705 11,414,456 482,249
Excess of resources over (under)
charges to appropriations (427,705) (442,705) 495,362 938,067
Fund balance, June 30 1,379,233$ 1,364,233$ 2,302,300$ 938,067$
See accompanying note to required supplementary information.
CITY OF PALM DESERT
- 136 -
For the year ended June 30, 2016
Budgeted Amounts
BUDGETARY COMPARISON SCHEDULE
PROP A FIRE TAX SPECIAL REVENUE FUND
-137 -
CITY OF PALM DESERT
NOTE TO REQUIRED SUPPLEMENTARY INFORMATION
June 30, 2016
BUDGETS AND BUDGETARY ACCOUNTING:
The City used the following procedures in establishing the budgetary data reported in the financial
statements:
1.Before the beginning of the fiscal year, the City Manager submits to the City Council a
proposed budget for the year commencing the following July 1.
2.Public hearings are conducted to obtain taxpayer comments.
3.The budget is subsequently adopted through passage of a resolution.
4.Expenditures for the General Fund cannot exceed amounts budgeted at the departmental level,
which is the legal level of control.
For other funds, expenditures cannot exceed the total amount budgeted for each fund, which is
the legal level of control. The City Manager is authorized to transfer appropriations (without
council approval) between an object of a General Fund Department. The City Council
approves all other changes. Annual appropriation amounts lapse at year-end.
5.Encumbrances and continuing appropriations are rebudgeted as of July 1, by Council action.
6.Annual budgets are adopted on a basis consistent with accounting principles generally accepted
in the United States of America for all governmental funds except for certain special revenue
funds and capital projects funds, which adopt project length budgets and debt service funds that
are not budgeted as effectively budgetary control is achieved through debt indenture provisions.
The following special revenue funds had legally adopted budgets during the current fiscal year:
Major Fund
Prop A Fire Tax
Other Governmental Funds
Traffic Safety
Gas Tax
Housing Mitigation Fees
Community Development Block Grant
Public Safety Police Grants
El Paseo Assessment District
Landscape and Lighting District No.1-17
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-139 -
GENERAL FUND
The General Fund is used to account for all financial resources traditionally associated with
government, except those required to be accounted for in another fund. It is the primary operating fund
that includes the operating budgets for all the departments and the majority of the City’s tax revenues.
Schedule 6
Variance with
Final Budget
Actual Positive
Original Final Amounts (Negative)
Fund balance, July 1 79,810,669$ 79,810,669$ 79,810,669$ -$
Resources (inflows):
Taxes:
Property taxes 5,575,000 6,611,000 6,611,118 118
Property transfer tax 550,000 550,000 491,060 (58,940)
Property tax in lieu 3,705,000 3,705,000 3,850,477 145,477
Timeshare mitigation fee 1,450,000 1,450,000 1,500,683 50,683
Sales tax 18,800,000 18,995,000 18,994,779 (221)
Business license tax 1,250,000 1,250,000 1,269,082 19,082
Job valuation fees 30,000 30,000 44,625 14,625
Transient occupancy tax 10,200,000 11,225,000 11,252,997 27,997
Franchises 3,200,000 3,200,000 3,095,873 (104,127)
Penalties and interest on taxes 30,000 30,000 43,331 13,331
Total Taxes 44,790,000 47,046,000 47,154,025 108,025
Licenses and Permits:
Building permits 1,350,000 1,350,000 1,203,141 (146,859)
Grading permits 10,000 10,000 12,974 2,974
Encroachment permits 100,000 100,000 114,554 14,554
Miscellaneous permits 1,500 1,500 1,445 (55)
Business regulatory permits 50,000 50,000 34,070 (15,930)
Valet parking permits 500 500 600 100
Total Licenses and Permits 1,512,000 1,512,000 1,366,784 (145,216)
Intergovernmental Revenues:
Grants - - 335,505 335,505
State mandate cost - - 38,718 38,718
Motor vehicle in-lieu fees 30,000 30,000 20,599 (9,401)
Monthly parking ball 15,000 15,000 7,345 (7,655)
Reimbursement RDA costs 943,000 943,000 915,150 (27,850)
Other reimbursements 700,000 700,000 674,361 (25,639)
Total Intergovernmental Revenues 1,688,000 1,688,000 1,991,678 303,678
(Continued)
- 140 -
CITY OF PALM DESERT
BUDGETARY COMPARISON SCHEDULE BY DEPARTMENT
GENERAL FUND
For the year ended June 30, 2016
Budgeted Amounts
Schedule 6
Variance with
Final Budget
Actual Positive
Original Final Amounts (Negative)
Resources (inflows) (Continued):
Rental income 170,000$ 170,000$ 154,675$ (15,325)$
Charges for Services:
Subdivision fees 250,000 250,000 365,806 115,806
Zoning fees 138,000 138,000 131,639 (6,361)
Plan check fees 650,000 650,000 592,818 (57,182)
Sale of maps and publications 15,000 15,000 11,308 (3,692)
Microfilm fees 15,000 15,000 8,558 (6,442)
Other fees 96,000 96,000 207,411 111,411
Total Charges for Services 1,164,000 1,164,000 1,317,540 153,540
Fines and Forfeitures:
Vehicle code fines 20,000 20,000 19,769 (231)
Municipal court fines 15,000 15,000 47,566 32,566
VICR fees 100,000 100,000 75,310 (24,690)
Total Fines and Forfeitures 135,000 135,000 142,645 7,645
Investment Earnings:
Interest income 230,000 480,000 480,802 802
Interest on notes receivable 100,000 217,500 244,213 26,713
Total Investment Earnings 330,000 697,500 725,015 27,515
Miscellaneous Revenues:
Code compliance 5,000 5,000 13,118 8,118
Strong motion instrument fee 10,000 10,000 34,759 24,759
Special investigation fee 5,000 5,000 3,591 (1,409)
Certificate of compliance fee 1,000 1,000 1,675 675
Nuisance abatement tax 30,000 30,000 44,482 14,482
Abandoned vehicle abatement 55,000 55,000 53,695 (1,305)
Fire inspection service 200,000 200,000 227,029 27,029
Other revenue 230,000 230,000 207,197 (22,803)
Total Miscellaneous Revenues 536,000 536,000 585,546 49,546
Transfers from other funds 1,400,000 1,400,000 1,390,258 (9,742)
Amounts Available for Appropriation 51,725,000 54,348,500 54,828,166 479,666
(Continued)
For the year ended June 30, 2016
Budgeted Amounts
- 141 -
CITY OF PALM DESERT
BUDGETARY COMPARISON SCHEDULE BY DEPARTMENT
GENERAL FUND
(CONTINUED)
Schedule 6
Variance with
Final Budget
Actual Positive
Original Final Amounts (Negative)
Charges to appropriations (outflows):
General Government - Departmental:
City council 246,632$ 272,632$ 265,747$ 6,885$
City clerk 935,900 949,242 949,164 78
Legislative advocacy 36,500 36,500 36,180 320
City attorney 249,600 249,600 241,956 7,644
Legal special services 265,000 265,000 186,959 78,041
City manager 1,066,709 1,195,909 1,195,892 17
Community services 455,400 455,900 454,868 1,032
Finance 1,911,893 1,911,893 1,880,488 31,405
Auditing 80,000 80,000 62,227 17,773
Human resources 593,780 623,780 531,484 92,296
General services 577,400 1,064,655 1,025,256 39,399
Information technology 915,600 994,515 878,075 116,440
Unemployment insurance - 7,020 7,020 -
Insurance 518,700 518,700 256,390 262,310
Community promotions 731,000 810,500 791,565 18,935
Community development 2,297,450 2,305,684 2,187,637 118,047
Economic development center 1,080,750 1,221,850 1,132,540 89,310
Marketing 1,314,830 1,397,880 1,075,569 322,311
Total General Government - Departmental 13,277,144 14,361,260 13,159,017 1,202,243
General Government - Nondepartmental:
Retiree funding - 480,000 480,000 -
Contributions to other agencies 680,000 711,200 558,731 152,469
Total General Government - Non departmental 680,000 1,191,200 1,038,731 152,469
Total General Government 13,957,144 15,552,460 14,197,748 1,354,712
Public Safety:
Police services 20,179,250 20,200,373 19,668,942 531,431
Animal regulation 245,000 245,000 233,467 11,533
Traffic safety 242,000 248,900 248,828 72
Building and safety 1,908,575 1,908,575 1,888,290 20,285
Total Public Safety 22,574,825 22,602,848 22,039,527 563,321
(Continued)
GENERAL FUND
(CONTINUED)
For the year ended June 30, 2016
Budgeted Amounts
- 142 -
CITY OF PALM DESERT
BUDGETARY COMPARISON SCHEDULE BY DEPARTMENT
Schedule 6
Variance with
Final Budget
Actual Positive
Original Final Amounts (Negative)
Charges to appropriations (outflows) (Continued):
Public Works:
Administration 2,831,150$ 3,004,189$ 2,664,871$ 339,318$
Street maintenance 2,768,621 2,826,217 2,709,328 116,889
Street resurfacing 500,000 1,377,327 1,083,919 293,408
Corporate yard 65,500 65,500 51,083 14,417
Building maintenance 526,900 624,521 587,079 37,442
Portola community center 65,750 65,750 63,083 2,667
Auto equipment 440,000 455,177 264,132 191,045
Storm water permit 90,000 90,000 39,612 50,388
Total Public Works 7,287,921 8,508,681 7,463,107 1,045,574
Parks, Recreation and Culture:
Park maintenance 1,057,350 849,125 842,673 6,452
Civic center park 789,150 1,101,901 1,059,535 42,366
Landscape service 1,783,689 2,147,371 1,874,803 272,568
Visitors center 363,550 363,550 241,372 122,178
Total Parks, Recreation and Culture 3,993,739 4,461,947 4,018,383 443,564
Capital Outlay - Departmental - 415,500 415,487 13
Transfers to other funds 3,900,000 4,182,000 4,141,928 40,072
Amounts Charged to Appropriation 51,713,629 55,723,436 52,276,180 3,447,256
Excess of resources over (under)
charges to appropriations 11,371 (1,374,936) 2,551,986 3,926,922
Fund balance, June 30 79,822,040$ 78,435,733$ 82,362,655$ 3,926,922$
- 143 -
BUDGETARY COMPARISON SCHEDULE BY DEPARTMENT
GENERAL FUND
(CONTINUED)
For the year ended June 30, 2016
Budgeted Amounts
CITY OF PALM DESERT
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-145 -
OTHER GOVERNMENTAL FUNDS
COMBINING STATEMENTS
Schedule 7
Total
Special Debt Capital Other
Revenue Service Projects Governmental
ASSETS:Funds Fund Funds Funds
Pooled cash and investments 19,399,902$ 197,317$ 14,261,887$ 33,859,106$
Receivables:
Accounts 405,362 - 4,068 409,430
Assessments - 1,309,422 - 1,309,422
Interest 253,962 - 1,699,981 1,953,943
Loans 4,294,557 - - 4,294,557
Prepaid costs 1,155 - 1,897 3,052
Inventories 4,431 - - 4,431
Due from other governments 245,227 3,895 760,432 1,009,554
Due from other funds - - 500,000 500,000
Advances to Successor Agency 654,000 - 12,765,000 13,419,000
Restricted assets:
Cash and investments with fiscal agent - - 179,275 179,275
TOTAL ASSETS 25,258,596$ 1,510,634$ 30,172,540$ 56,941,770$
LIABILITIES:
Accounts payable 351,182$ 1,612$ 142,661$ 495,455$
Accrued liabilities 9,690 - 4,110 13,800
Due to other funds 2,428,800 - 2,553,000 4,981,800
Unearned revenues 54,986 - 71,596 126,582
Deposits payable - 109,526 77,583 187,109
TOTAL LIABILITIES 2,844,658 111,138 2,848,950 5,804,746
DEFERRED INFLOWS OF RESOURCES:
Unavailable revenue 268,144 1,309,422 1,684,980 3,262,546
FUND BALANCES:
Nonspendable:
Prepaid costs 1,155 - 1,897 3,052
Restricted for:
Capital projects - - 180,574 180,574
Debt service - 90,074 - 90,074
Low income housing 2,530,186 - - 2,530,186
Public facilities 3,820,991 - - 3,820,991
Public safety 1,039,050 - - 1,039,050
Special programs 5,925,429 - 1,694,212 7,619,641
Street related purposes 3,830,637 - - 3,830,637
Committed to:
Aquatic center 2,133,281 - - 2,133,281
Energy loan program 2,865,065 - - 2,865,065
Assigned to:
Capital projects - - 9,372,241 9,372,241
Property acquisition - - 420,387 420,387
Public facilities - - 11,157,633 11,157,633
Special programs - - 667,255 667,255
Street related purposes - - 2,144,411 2,144,411
TOTAL FUND BALANCES 22,145,794 90,074 25,638,610 47,874,478
TOTAL LIABILITIES, DEFERRED
INFLOWS OF RESOURCES
AND FUND BALANCES 25,258,596$ 1,510,634$ 30,172,540$ 56,941,770$
RESOURCES AND FUND BALANCES
- 146 -
CITY OF PALM DESERT
COMBINING BALANCE SHEET
OTHER GOVERNMENTAL FUNDS
June 30, 2016
LIABILITIES, DEFERRED INFLOWS OF
Schedule 8
Total
Special Debt Capital Other
Revenue Service Projects Governmental
Funds Fund Funds Funds
REVENUES:
Taxes 1,242,940$ -$ -$ 1,242,940$
Special assessments collected 1,060,290 121,538 - 1,181,828
Licenses and permits - - 691,059 691,059
Intergovernmental revenues 1,727,566 - 1,092,029 2,819,595
Charges for services 765,303 - - 765,303
Investment earnings 469,228 717 105,545 575,490
Fines and forfeitures 152,624 - - 152,624
Miscellaneous 2,208 - 1,634,543 1,636,751
TOTAL REVENUES 5,420,159 122,255 3,523,176 9,065,590
EXPENDITURES:
Current:
General government 921,848 19,421 644,938 1,586,207
Housing and redevelopment 732,582 - - 732,582
Public safety 297,965 - - 297,965
Parks, recreation and culture 1,650,795 - 1,162,356 2,813,151
Public works 1,537,136 - 96,352 1,633,488
Capital outlay 11,131 - 1,012,671 1,023,802
Debt service:
Principal retirement 219,000 38,000 - 257,000
Interest and fiscal charges 221,465 74,871 - 296,336
TOTAL EXPENDITURES 5,591,922 132,292 2,916,317 8,640,531
EXCESS OF REVENUES OVER
(UNDER) EXPENDITURES (171,763) (10,037) 606,859 425,059
OTHER FINANCING SOURCES (USES):
Transfers in 1,494,868 - 145,580 1,640,448
Transfers out (423,570) - (776,000) (1,199,570)
TOTAL OTHER FINANCING
SOURCES (USES)1,071,298 - (630,420) 440,878
NET CHANGE IN FUND BALANCES 899,535 (10,037) (23,561) 865,937
FUND BALANCES - BEGINNING OF YEAR 21,246,259 100,111 25,662,171 47,008,541
FUND BALANCES - END OF YEAR 22,145,794$ 90,074$ 25,638,610$ 47,874,478$
- 147 -
CITY OF PALM DESERT
COMBINING STATEMENT OF REVENUES, EXPENDITURES
AND CHANGES IN FUND BALANCES
OTHER GOVERNMENTAL FUNDS
For the year ended June 30, 2016
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-149 -
OTHER GOVERNMENTAL FUNDS -SPECIAL REVENUE
Special Revenue Funds are used to account for proceeds of specific revenue sources other than
expendable trust that are legally restricted to expenditures for specific purposes.
Traffic Safety Fund -Traffic and court fines are collected in these funds. A transfer from this Fund to
the General Fund is made at the end of the fiscal year by council action to be applied toward the
eligible expenditures permitted by law.
Gas Tax Fund -Portions of the tax rate per gallon levied by the State of California on all gasoline
purchases are allocated to cities throughout the State. These funds are restricted to expenditure for
transit and street-related purposes.
Housing Mitigation Fee Fund -This fund is used to account for fees collected from construction of
commercial and office buildings for low and moderate income mitigation purposes to be used strictly
for projects and programs that benefit the low and moderate income households.
Community Development Block Grant Fund -This fund is used to account for the receipts and
expenditures of CDBG funds received from the U.S. Department of Housing and Urban Development.
New Construction Tax Fund -This fund is used to account for tax collected upon application to the
City for a building permit from every person/entity for the construction of any new building, addition
or trailer space in the city according to a fee schedule. Its use is restricted for the acquisition and
development of public facilities such as parks, playgrounds and public structures.
Planned Drainage Fund -This fund is used to account for off-site drainage fees based on an established
fee schedule collected prior to approval of the final map in the case of land being subdivided or prior to
the issuance of a building permit in the case of construction or improvement of subdivided land.
Park and Recreation Facilities Fund -This fund is used to account for fees collected for residential and
subdivision developments collected either at the time grading permits are paid or prior to the approval
of the final map. Its use is restricted for expenditures related to park development, maintenance and
equipment.
Traffic Signals Fund -This fund is used to account for fees collected for residential, commercial and
industrial developments either at the time grading permits are paid or prior to the approval of the final
map. Its use is restricted for expenditures related to the acquisition and maintenance of traffic signals.
Recycling Fund -This fund is used to account for resources resulting from lower landfill tipping fees
which have been reduced to zero in 2013, and State grant funds. Funds will be utilized for purposes of
promoting recycling and recycling related activities.
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OTHER GOVERNMENTAL FUNDS -SPECIAL REVENUE
(CONTINUED)
Public Safety Police Grants Fund -This fund is used to account for grants received from the U.S.
Department of Justice under the Local Law Enforcement Block Grants Program for the purpose of
purchasing equipment related to public safety.
El Paseo Assessment District Fund -This fund is used to collect assessments on all business
establishments located within the boundaries set for the El Paseo parking and business improvement
area based on a fee schedule established for the various types of businesses. Proceeds from all charges
are used for the promotion of business activities in the area.
Air Quality Management Fund -This fund accounts for receipts from South Coast Air Quality
Management District, sixty percent of which is disbursed to the Coachella Valley Association of
Governments.
Various Landscape and Lighting District Funds -These funds are used to account for expenditures and
receipts of property taxes and service fees levied to the property owners in the various landscaping and
lighting districts, which were formed to provide landscaping and street lighting maintenance.
Individual landscaping and lighting funds are set up for Districts No. 1 through 17.
Child Care Program Fund -This fund is used to collect funds from developers for the purpose of
providing child care programs.
Fire Facilities Restoration Fund -This fund is used to collect funds from developers for the purpose of
construction, restoration and purchase of equipment for fire stations within the City.
Energy Independence Loan Fund -This fund is used to provide funding for the AB811 Energy Loans
and collect assessments from those AB811 loans through property tax collections. The assessments
collected will be used to service debt issued and to provide additional funding for the AB811 loans.
Aquatic Center Fund -This fund is used to account for revenues and expenditures of the City’s aquatic
facility.
RDA Low Income Housing Fund -This fund is used to account for the management and operation of
the City’s housing assets.
Housing
Traffic Mitigation
Safety Gas Tax Fee
ASSETS:
Pooled cash and investments -$ 1,308,074$ 2,530,186$
Receivables:
Accounts - - -
Interest - - -
Loans - - -
Prepaid costs - - -
Inventories - - -
Due from other governments 13,749 77,833 -
Advances to Successor Agency - - -
TOTAL ASSETS 13,749$ 1,385,907$ 2,530,186$
LIABILITIES:
Accounts payable -$ -$ -$
Accrued liabilities - - -
Due to other funds - - -
Unearned revenues - - -
TOTAL LIABILITIES - - -
DEFERRED INFLOWS OF RESOURCES:
Unavailable revenue - - -
FUND BALANCES:
Nonspendable:
Prepaid costs - - -
Restricted for:
Low income housing - - 2,530,186
Public facilities - - -
Public safety - - -
Special programs - - -
Street related purposes 13,749 1,385,907 -
Committed to:
Aquatic center - - -
Energy loan program - - -
TOTAL FUND BALANCES 13,749 1,385,907 2,530,186
TOTAL LIABILITIES, DEFERRED INFLOWS
OF RESOURCES AND FUND BALANCES 13,749$ 1,385,907$ 2,530,186$
June 30, 2016
RESOURCES AND FUND BALANCES
- 152 -
LIABILITIES, DEFERRED INFLOWS OF
CITY OF PALM DESERT
OTHER SPECIAL REVENUE FUNDS
COMBINING BALANCE SHEET
Schedule 9
Community New Park and Public El Paseo
Development Construction Planned Recreation Traffic Safety Police Assessment
Block Grant Tax Drainage Facilities Signals Recycling Grants District
19,181$ 797,414$ 2,079,961$ 1,308,522$ 351,020$ 3,085,219$ 35,141$ 72,048$
- - - - - - - -
- 86,328 - - - - - -
14,182 - - - - - - -
- - - - - - - -
- - - - - - - -
72,937 - - - - 11,785 33,669 -
- 654,000 - - - - - -
106,300$ 1,537,742$ 2,079,961$ 1,308,522$ 351,020$ 3,097,004$ 68,810$ 72,048$
72,937$ 1,967$ -$ 3,167$ -$ 40,455$ 31,158$ 12,366$
- - - - - 2,551 - -
- 130,800 - - - - - -
- - - - - 6,860 30,626 -
72,937 132,767 - 3,167 - 49,866 61,784 12,366
14,182 86,328 - - - - - -
- - - - - - - -
- - - - - - - -
- 1,318,647 - 1,305,355 - - - -
- - - - - - 7,026 -
19,181 - - - - 3,047,138 - 59,682
- - 2,079,961 - 351,020 - - -
- - - - - - - -
- - - - - - - -
19,181 1,318,647 2,079,961 1,305,355 351,020 3,047,138 7,026 59,682
106,300$ 1,537,742$ 2,079,961$ 1,308,522$ 351,020$ 3,097,004$ 68,810$ 72,048$
(Continued)
- 153 -
Landscape
Air and Lighting Fire
Quality Districts Child Care Facilities
Management Nos. 1 - 17 Program Restoration
ASSETS:
Pooled cash and investments 96,954$ 2,701,013$ 1,196,989$ 1,032,024$
Receivables:
Accounts - - - -
Interest - - - -
Loans - - - -
Prepaid costs - - - -
Inventories - - - -
Due from other governments 17,467 17,787 - -
Advances to Successor Agency - - - -
TOTAL ASSETS 114,421$ 2,718,800$ 1,196,989$ 1,032,024$
LIABILITIES:
Accounts payable 10,481$ 23,312$ -$ -$
Accrued liabilities - - - -
Due to other funds - - - -
Unearned revenues - - - -
TOTAL LIABILITIES 10,481 23,312 - -
DEFERRED INFLOWS OF RESOURCES:
Unavailable revenue - - - -
FUND BALANCES:
Nonspendable:
Prepaid costs - - - -
Restricted for:
Low income housing - - - -
Public facilities - - 1,196,989 -
Public safety - - - 1,032,024
Special programs 103,940 2,695,488 - -
Street related purposes - - - -
Committed to:
Aquatic center - - - -
Energy loan program - - - -
TOTAL FUND BALANCES 103,940 2,695,488 1,196,989 1,032,024
TOTAL LIABILITIES, DEFERRED INFLOWS
OF RESOURCES AND FUND BALANCES 114,421$ 2,718,800$ 1,196,989$ 1,032,024$
June 30, 2016
- 154 -
RESOURCES AND FUND BALANCES
LIABILITIES, DEFERRED INFLOWS OF
CITY OF PALM DESERT
COMBINING BALANCE SHEET
OTHER SPECIAL REVENUE FUNDS
(CONTINUED)
Schedule 9
Total
Energy RDA Other
Independence Aquatic Low Income Special Revenue
Loan Center Housing Funds
868,942$ 1,910,075$ 7,139$ 19,399,902$
14,991 390,371 - 405,362
167,634 - - 253,962
4,280,375 - - 4,294,557
- 1,155 - 1,155
- 4,431 - 4,431
- - - 245,227
- - - 654,000
5,331,942$ 2,306,032$ 7,139$ 25,258,596$
1,243$ 154,096$ -$ 351,182$
- - 7,139 9,690
2,298,000 - - 2,428,800
- 17,500 - 54,986
2,299,243 171,596 7,139 2,844,658
167,634 - - 268,144
- 1,155 - 1,155
- - - 2,530,186
- - - 3,820,991
- - - 1,039,050
- - - 5,925,429
- - - 3,830,637
- 2,133,281 - 2,133,281
2,865,065 - - 2,865,065
2,865,065 2,134,436 - 22,145,794
5,331,942$ 2,306,032$ 7,139$ 25,258,596$
- 155 -
Housing
Traffic Mitigation
Safety Gas Tax Fee
REVENUES:
Taxes -$ -$ 258,339$
Special assessments collected - - -
Intergovernmental revenues - 1,050,361 -
Charges for services - - -
Investment earnings 314 4,747 15,078
Fines and forfeitures 152,624 - -
Miscellaneous - - -
TOTAL REVENUES 152,938 1,055,108 273,417
EXPENDITURES:
Current:
General government - - -
Housing and redevelopment - - -
Public safety - - -
Parks, recreation and culture - - -
Public works - 500,000 -
Capital outlay - - -
Debt service:
Principal retirement - - -
Interest and fiscal charges - - -
TOTAL EXPENDITURES - 500,000 -
EXCESS OF REVENUES OVER
(UNDER) EXPENDITURES 152,938 555,108 273,417
OTHER FINANCING SOURCES (USES):
Transfers in - - -
Transfers out (150,258) (226,500) -
TOTAL OTHER FINANCING
SOURCES (USES)(150,258) (226,500) -
NET CHANGE IN FUND BALANCES 2,680 328,608 273,417
FUND BALANCES -
BEGINNING OF YEAR 11,069 1,057,299 2,256,769
FUND BALANCES - END OF YEAR 13,749$ 1,385,907$ 2,530,186$
OTHER SPECIAL REVENUE FUNDS
COMBINING STATEMENT OF REVENUES, EXPENDITURES
CITY OF PALM DESERT
AND CHANGES IN FUND BALANCES
For the year ended June 30, 2016
- 156 -
Schedule 10
Community New Park and Public El Paseo
Development Construction Planned Recreation Traffic Safety Police Assessment
Block Grant Tax Drainage Facilities Signals Recycling Grants District
-$ 221,946$ 143,080$ 302,145$ 101,711$ -$ -$ -$
- - - - - - - 253,736
249,548 - - - - 36,572 300,299 -
- - - - - - - -
37 4,755 12,757 7,781 1,999 20,663 - -
- - - - - - - -
160 1,797 - - - 251 - -
249,745 228,498 155,837 309,926 103,710 57,486 300,299 253,736
249,548 60,183 - - - 319,152 - 242,563
- - - - - - - -
- - - - - - 297,965 -
- - - 106,663 - 72,982 - -
- 136,334 - - - 242,995 - -
- - - 1,800 - - 2,334 -
- - - - - - - -
- - - - - - - -
249,548 196,517 - 108,463 - 635,129 300,299 242,563
197 31,981 155,837 201,463 103,710 (577,643) - 11,173
- - - - - - - -
- - - - - (46,812) - -
- - - - - (46,812) - -
197 31,981 155,837 201,463 103,710 (624,455) - 11,173
18,984 1,286,666 1,924,124 1,103,892 247,310 3,671,593 7,026 48,509
19,181$ 1,318,647$ 2,079,961$ 1,305,355$ 351,020$ 3,047,138$ 7,026$ 59,682$
(Continued)
- 157 -
Landscape
Air and Lighting Fire
Quality Districts Child Care Facilities
Management Nos. 1 - 17 Program Restoration
REVENUES:
Taxes -$ -$ 168,940$ 46,779$
Special assessments collected - 806,554 - -
Intergovernmental revenues 90,786 - - -
Charges for services - - - -
Investment earnings 547 9,830 6,984 6,389
Fines and forfeitures - - - -
Miscellaneous - - - -
TOTAL REVENUES 91,333 816,384 175,924 53,168
EXPENDITURES:
Current:
General government 42,804 - - -
Housing and redevelopment - - - -
Public safety - - - -
Parks, recreation and culture 20,880 - - -
Public works - 657,807 - -
Capital outlay - - - -
Debt service:
Principal retirement - - - -
Interest and fiscal charges - - - -
TOTAL EXPENDITURES 63,684 657,807 - -
EXCESS OF REVENUES OVER
(UNDER) EXPENDITURES 27,649 158,577 175,924 53,168
OTHER FINANCING SOURCES (USES):
Transfers in - 77,819 - -
Transfers out - - - -
TOTAL OTHER FINANCING
SOURCES (USES)- 77,819 - -
NET CHANGE IN FUND BALANCES 27,649 236,396 175,924 53,168
FUND BALANCES -
BEGINNING OF YEAR 76,291 2,459,092 1,021,065 978,856
FUND BALANCES - END OF YEAR 103,940$ 2,695,488$ 1,196,989$ 1,032,024$
- 158 -
COMBINING STATEMENT OF REVENUES, EXPENDITURES
AND CHANGES IN FUND BALANCES
OTHER SPECIAL REVENUE FUNDS
(CONTINUED)
For the year ended June 30, 2016
CITY OF PALM DESERT
Schedule 10
Total
Energy RDA Other
Independence Aquatic Low Income Special Revenue
Loan Center Housing Funds
-$ -$ -$ 1,242,940$
- - - 1,060,290
- - - 1,727,566
- 765,303 - 765,303
369,850 7,497 - 469,228
- - - 152,624
- - - 2,208
369,850 772,800 - 5,420,159
7,598 - - 921,848
- - 732,582 732,582
- - - 297,965
- 1,450,270 - 1,650,795
- - - 1,537,136
- 5,871 1,126 11,131
219,000 - - 219,000
221,465 - - 221,465
448,063 1,456,141 733,708 5,591,922
(78,213) (683,341) (733,708) (171,763)
- 683,341 733,708 1,494,868
- - - (423,570)
- 683,341 733,708 1,071,298
(78,213) - - 899,535
2,943,278 2,134,436 - 21,246,259
2,865,065$ 2,134,436$ -$ 22,145,794$
- 159 -
Schedule 11-A
Variance with
Final Budget
Actual Positive
Original Final Amounts (Negative)
Fund balance, July 1 11,069$ 11,069$ 11,069$ -$
Resources (inflows):
Investment earnings 500 500 314 (186)
Fines and forfeitures 119,500 152,500 152,624 124
Total resources 120,000 153,000 152,938 (62)
Charges to appropriations (outflows):
Transfers out 120,000 150,300 150,258 42
Total charges to appropriations 120,000 150,300 150,258 42
Excess of resources over (under)
charges to appropriations - 2,700 2,680 (20)
Fund balance, June 30 11,069$ 13,769$ 13,749$ (20)$
CITY OF PALM DESERT
- 160 -
For the year ended June 30, 2016
Budgeted Amounts
SCHEDULE OF REVENUES, EXPENDITURES AND
CHANGES IN FUND BALANCE - BUDGET AND ACTUAL
TRAFFIC SAFETY
Schedule 11-B
Variance with
Final Budget
Actual Positive
Original Final Amounts (Negative)
Fund balance, July 1 1,057,299$ 1,057,299$ 1,057,299$ -$
Resources (inflows):
Intergovernmental revenues 1,105,500 1,105,500 1,050,361 (55,139)
Investment earnings 1,500 1,500 4,747 3,247
Total resources 1,107,000 1,107,000 1,055,108 (51,892)
Charges to appropriations (outflows):
Current:
Public works 500,000 500,000 500,000 -
Transfers out 226,500 226,500 226,500 -
Total charges to appropriations 726,500 726,500 726,500 -
Excess of resources over (under)
charges to appropriations 380,500 380,500 328,608 (51,892)
Fund balance, June 30 1,437,799$ 1,437,799$ 1,385,907$ (51,892)$
CITY OF PALM DESERT
- 161 -
For the year ended June 30, 2016
Budgeted Amounts
SCHEDULE OF REVENUES, EXPENDITURES AND
CHANGES IN FUND BALANCE - BUDGET AND ACTUAL
GAS TAX
Schedule 11-C
Variance with
Final Budget
Actual Positive
Original Final Amounts (Negative)
Fund balance, July 1 2,256,769$ 2,256,769$ 2,256,769$ -$
Resources (inflows):
Taxes 94,000 94,000 258,339 164,339
Investment earnings 9,500 9,500 15,078 5,578
Miscellaneous 50,000 50,000 - (50,000)
Total resources 153,500 153,500 273,417 119,917
Charges to appropriations (outflows):
Current:
Housing and redevelopment 450,000 700,000 - 700,000
Total charges to appropriations 450,000 700,000 - 700,000
Excess of resources over (under)
charges to appropriations (296,500) (546,500) 273,417 819,917
Fund balance, June 30 1,960,269$ 1,710,269$ 2,530,186$ 819,917$
CITY OF PALM DESERT
- 162 -
For the year ended June 30, 2016
Budgeted Amounts
SCHEDULE OF REVENUES, EXPENDITURES AND
CHANGES IN FUND BALANCE - BUDGET AND ACTUAL
HOUSING MITIGATION FEES
Schedule 11-D
Variance with
Final Budget
Actual Positive
Original Final Amounts (Negative)
Fund balance, July 1 18,984$ 18,984$ 18,984$ -$
Resources (inflows):
Intergovernmental revenues 294,000 294,000 249,548 (44,452)
Investment earnings - - 37 37
Miscellaneous - - 160 160
Total resources 294,000 294,000 249,745 (44,255)
Charges to appropriations (outflows):
Current:
General government 294,000 294,000 249,548 44,452
Total charges to appropriations 294,000 294,000 249,548 44,452
Excess of resources over (under)
charges to appropriations - - 197 197
Fund balance, June 30 18,984$ 18,984$ 19,181$ 197$
CITY OF PALM DESERT
- 163 -
For the year ended June 30, 2016
Budgeted Amounts
SCHEDULE OF REVENUES, EXPENDITURES AND
CHANGES IN FUND BALANCE - BUDGET AND ACTUAL
COMMUNITY DEVELOPMENT BLOCK GRANT
Schedule 11-E
Variance with
Final Budget
Actual Positive
Original Final Amounts (Negative)
Fund balance, July 1 7,026$ 7,026$ 7,026$ -$
Resources (inflows):
Intergovernmental revenues 100,000 300,300 300,299 (1)
Total resources 100,000 300,300 300,299 (1)
Charges to appropriations (outflows):
Current:
Public safety 100,000 297,965 297,965 -
Capital outlay - 2,335 2,334 1
Total charges to appropriations 100,000 300,300 300,299 1
Excess of resources over (under)
charges to appropriations - - - -
Fund balance, June 30 7,026$ 7,026$ 7,026$ -$
Budgeted Amounts
- 164 -
CITY OF PALM DESERT
SCHEDULE OF REVENUES, EXPENDITURES AND
CHANGES IN FUND BALANCE - BUDGET AND ACTUAL
PUBLIC SAFETY POLICE GRANTS
For the year ended June 30, 2016
Schedule 11-F
Variance with
Final Budget
Actual Positive
Original Final Amounts (Negative)
Fund balance, July 1 48,509$ 48,509$ 48,509$ -$
Resources (inflows):
Special assessments collected 250,000 250,000 253,736 3,736
Total resources 250,000 250,000 253,736 3,736
Charges to appropriations (outflows):
Current:
General government 250,000 250,000 242,563 7,437
Total charges to appropriations 250,000 250,000 242,563 7,437
Excess of resources over (under)
charges to appropriations - - 11,173 11,173
Fund balance, June 30 48,509$ 48,509$ 59,682$ 11,173$
CITY OF PALM DESERT
- 165 -
For the year ended June 30, 2016
Budgeted Amounts
SCHEDULE OF REVENUES, EXPENDITURES AND
CHANGES IN FUND BALANCE - BUDGET AND ACTUAL
EL PASEO ASSESSMENT DISTRICT
Schedule 11-G
Variance with
Final Budget
Actual Positive
Original Final Amounts (Negative)
Fund balance, July 1 2,459,092$ 2,459,092$ 2,459,092$ -$
Resources (inflows):
Special assessments collected 614,107 614,107 806,554 192,447
Investment earnings - - 9,830 9,830
Transfers in 75,000 75,000 77,819 2,819
Total resources 689,107 689,107 894,203 205,096
Charges to appropriations (outflows):
Current:
Public works 579,727 845,136 657,807 187,329
Total charges to appropriations 579,727 845,136 657,807 187,329
Excess of resources over (under)
charges to appropriations 109,380 (156,029) 236,396 392,425
Fund balance, June 30 2,568,472$ 2,303,063$ 2,695,488$ 392,425$
CITY OF PALM DESERT
- 166 -
For the year ended June 30, 2016
Budgeted Amounts
SCHEDULE OF REVENUES, EXPENDITURES AND
CHANGES IN FUND BALANCE - BUDGET AND ACTUAL
LANDSCAPE AND LIGHTING DISTRICTS NOS. 1 - 17
-167 -
OTHER GOVERNMENTAL FUNDS -DEBT SERVICE FUND
City Highlands Undergrounding Fund -This fund is used to account for the resources and payment for
debt related to Highlands Undergrounding.
Schedule 12
Total
City Other
Highlands Debt Service
Undergrounding Fund
ASSETS:
Pooled cash and investments 197,317$ 197,317$
Receivables:
Assessments 1,309,422 1,309,422
Due from other governments 3,895 3,895
TOTAL ASSETS 1,510,634$ 1,510,634$
LIABILITIES:
Accounts payable 1,612$ 1,612$
Deposits payable 109,526 109,526
TOTAL LIABILITIES 111,138 111,138
DEFERRED INFLOWS OF RESOURCES:
Unavailable revenue 1,309,422 1,309,422
TOTAL DEFERRED INFLOWS
OF RESOURCES 1,309,422 1,309,422
FUND BALANCE:
Restricted for:
Debt service 90,074 90,074
TOTAL FUND BALANCE 90,074 90,074
TOTAL LIABILITIES, DEFERRED
INFLOWS OF RESOURCES AND
FUND BALANCE 1,510,634$ 1,510,634$
RESOURCESAND FUND BALANCES
- 168 -
CITY OF PALM DESERT
BALANCE SHEET
OTHER DEBT SERVICE FUND
June 30, 2016
LIABILITIES, DEFERRED INFLOWS OF
Schedule 13
Total
City Other
Highlands Debt Service
Undergrounding Fund
REVENUES:
Special assessments collected 121,538$ 121,538$
Investment earnings 717 717
TOTAL REVENUES 122,255 122,255
EXPENDITURES:
Current:
General government 19,421 19,421
Debt service:
Principal retirement 38,000 38,000
Interest and fiscal charges 74,871 74,871
TOTAL EXPENDITURES 132,292 132,292
EXCESS OF REVENUES OVER
(UNDER) EXPENDITURES (10,037) (10,037)
FUND BALANCE - BEGINNING OF YEAR 100,111 100,111
FUND BALANCE - END OF YEAR 90,074$ 90,074$
- 169 -
CITY OF PALM DESERT
STATEMENT OF REVENUES, EXPENDITURES
AND CHANGES IN FUND BALANCE
OTHER DEBT SERVICE FUND
For the year ended June 30, 2016
-170 -
THIS PAGE INTENTIONALLY LEFT BLANK
-171 -
OTHER GOVERNMENTAL FUNDS -CAPITAL PROJECTS
Capital Projects Funds are used to account for the acquisition and construction of major capital
facilities, except for those financed by certain Special Revenue and Enterprise funds.
Arts in Public Places Fund -This fund is used to account for fees collected from residential,
commercial and public facilities development except for street and drainage projects. Its use is
restricted for acquisition, installation, improvement and maintenance of artwork to be displayed in the
City, the administration of the program and community public art education programs.
Drainage Facilities Fund -This fund is used to account for resources and expenditures for planned
capital improvement projects that are under the Master Drainage Plan.
Parks and Recreation Facilities Fund -This fund is used to account for resources and expenditures for
capital improvement projects that are related to park development, maintenance and equipment.
Signalization Fund -This fund is used to account for resources and expenditures for capital
improvement projects that are related to the acquisition and maintenance of traffic signals.
Buildings Fund -This fund is used to account for resources and expenditures for capital improvement
projects that are related to the improvement and maintenance of public facilities and structures.
Library Fund -This fund is used to account for resources and expenditures for capital improvement
projects that are related to the purchase of library resources for the Multi-Agency Library.
Special Assessment District Funds -This fund is used to account for the construction of public
improvements from proceeds resulting from the creation of various assessment Districts.
Assessment District No. 94-3 Merano
Silver Spur Ranch
Highlands Undergrounding
Assessment 29
Capital Golf Fund -This fund is used to offset the cost of capital improvements, equipment purchases,
perimeter maintenance, pay off assessments and other nonrecurring costs that will arise as a result of
Desert Willow Golf Course Resort. Funding sources for the Golf Course Maintenance Fund are
collections from the IROC and Standard Vacation Ownership, Inc.time-share project.
Capital Projects Reserve -This fund is used to account for resources and expenditures for capital
improvement projects that are related to the acquisition and development of public facilities,
infrastructure and equipment.
Economic Development -This fund is used to account for façade enhancement projects for Palm
Desert businesses utilizing funds from the sales of certain City-owned properties.
Arts in Drainage
Public Places Facilities
ASSETS:
Pooled cash and investments 1,780,381$ 2,042,645$
Receivables:
Accounts - -
Interest - -
Prepaid costs - -
Due from other governments - -
Due from other funds - -
Advances to Successor Agency - -
Restricted assets:
Cash and investments with fiscal agent - -
TOTAL ASSETS 1,780,381$ 2,042,645$
LIABILITIES:
Accounts payable 4,476$ -$
Accrued liabilities 4,110 -
Due to other funds - -
Unearned revenues - -
Deposits payable 77,583 -
TOTAL LIABILITIES 86,169 -
DEFERRED INFLOWS OF RESOURCES:
Unavailable revenue - -
FUND BALANCES:
Nonspendable:
Prepaid costs - -
Restricted for:
Capital projects - -
Special programs 1,694,212 -
Assigned to:
Capital projects - -
Property acquisition - -
Public facilities - -
Special programs - -
Street related purposes - 2,042,645
TOTAL FUND BALANCES 1,694,212 2,042,645
TOTAL LIABILITIES, DEFERRED INFLOWS
OF RESOURCES AND FUND BALANCES 1,780,381$ 2,042,645$
CITY OF PALM DESERT
OTHER CAPITAL PROJECTS FUNDS
- 172 -
COMBINING BALANCE SHEET
June 30, 2016
LIABILITIES, DEFERRED INFLOWS OF
RESOURCES AND FUND BALANCES
Schedule 14
Parks and Assessment
Recreation District No. 94-3 Silver Spur
Facilities Signalization Buildings Library Merano Ranch
88,392$ 101,766$ 3,370,614$ 667,255$ -$ 593$
- - - - - -
628,980 - - - 42 -
- - - - - -
- - - - - -
- - - - - -
4,765,000 - - - - -
- - - - 179,275 -
5,482,372$ 101,766$ 3,370,614$ 667,255$ 179,317$ 593$
4,530$ -$ 3,930$ -$ -$ -$
- - - - - -
953,000 - - - - -
- - - - - -
- - - - - -
957,530 - 3,930 - - -
628,980 - - - - -
- - - - - -
- - - - 179,317 593
- - - - - -
- - - - - -
- - - - - -
3,895,862 - 3,366,684 - - -
- - - 667,255 - -
- 101,766 - - - -
3,895,862 101,766 3,366,684 667,255 179,317 593
5,482,372$ 101,766$ 3,370,614$ 667,255$ 179,317$ 593$
(Continued)
- 173 -
Highlands Assessment
Undergrounding 29
ASSETS:
Pooled cash and investments 21$ 643$
Receivables:
Accounts - -
Interest - -
Prepaid costs - -
Due from other governments - -
Due from other funds - -
Advances to Successor Agency - -
Restricted assets:
Cash and investments with fiscal agent - -
TOTAL ASSETS 21$ 643$
LIABILITIES:
Accounts payable -$ -$
Accrued liabilities - -
Due to other funds - -
Unearned revenues - -
Deposits payable - -
TOTAL LIABILITIES - -
DEFERRED INFLOWS OF RESOURCES:
Unavailable revenue - -
FUND BALANCES:
Nonspendable:
Prepaid costs - -
Restricted for:
Capital projects 21 643
Special programs - -
Assigned to:
Capital projects - -
Property acquisition - -
Public facilities - -
Special programs - -
Street related purposes - -
TOTAL FUND BALANCES 21 643
TOTAL LIABILITIES, DEFERRED INFLOWS
OF RESOURCES AND FUND BALANCES 21$ 643$
CITY OF PALM DESERT
- 174 -
COMBINING BALANCE SHEET
OTHER CAPITAL PROJECTS FUNDS
(CONTINUED)
June 30, 2016
LIABILITIES, DEFERRED INFLOWS OF
RESOURCES AND FUND BALANCES
Schedule 14
Total
Capital Other
Capital Projects Economic Capital Projects
Golf Reserve Development Funds
2,697,598$ 2,721,431$ 790,548$ 14,261,887$
4,068 - - 4,068
14,959 1,056,000 - 1,699,981
1,897 - - 1,897
- 760,432 - 760,432
500,000 - - 500,000
- 8,000,000 - 12,765,000
- - - 179,275
3,218,522$ 12,537,863$ 790,548$ 30,172,540$
112,086$ 17,639$ -$ 142,661$
- - - 4,110
- 1,600,000 - 2,553,000
- 71,596 - 71,596
- - - 77,583
112,086 1,689,235 - 2,848,950
- 1,056,000 - 1,684,980
1,897 - - 1,897
- - - 180,574
- - - 1,694,212
- 9,372,241 - 9,372,241
- 420,387 - 420,387
3,104,539 - 790,548 11,157,633
- - - 667,255
- - - 2,144,411
3,106,436 9,792,628 790,548 25,638,610
3,218,522$ 12,537,863$ 790,548$ 30,172,540$
- 175 -
Arts in Drainage
Public Places Facilities
REVENUES:
Licenses and permits 691,059$ -$
Intergovernmental revenues - -
Investment earnings 9,238 13,031
Miscellaneous 60,000 -
TOTAL REVENUES 760,297 13,031
EXPENDITURES:
Current:
General government - -
Parks, recreation and culture 385,534 -
Public works - 95,650
Capital outlay 85,031 -
TOTAL EXPENDITURES 470,565 95,650
EXCESS OF REVENUES OVER
(UNDER) EXPENDITURES 289,732 (82,619)
OTHER FINANCING SOURCES (USES):
Transfers in 80,580 -
Transfers out - -
TOTAL OTHER FINANCING
SOURCES (USES)80,580 -
NET CHANGE IN FUND BALANCES 370,312 (82,619)
FUND BALANCES - BEGINNING OF YEAR 1,323,900 2,125,264
FUND BALANCES - END OF YEAR 1,694,212$ 2,042,645$
COMBINING STATEMENT OF REVENUES, EXPENDITURES
CITY OF PALM DESERT
AND CHANGES IN FUND BALANCES
For the year ended June 30, 2016
- 176 -
OTHER CAPITAL PROJECTS FUNDS
Schedule 15
Parks and Assessment
Recreation District No. 94-3 Silver Spur
Facilities Signalization Buildings Library Merano Ranch
-$ -$ -$ -$ -$ -$
- - - - - -
853 638 21,101 - 375 4
- - - - - -
853 638 21,101 - 375 4
- - 27,710 - - -
73,148 - - - - -
- - - - - -
- - - - - -
73,148 - 27,710 - - -
(72,295) 638 (6,609) - 375 4
- - 65,000 - - -
- - - - - -
- - 65,000 - - -
(72,295) 638 58,391 - 375 4
3,968,157 101,128 3,308,293 667,255 178,942 589
3,895,862$ 101,766$ 3,366,684$ 667,255$ 179,317$ 593$
(Continued)
- 177 -
Highlands Assessment
Undergrounding 29
REVENUES:
Licenses and permits -$ -$
Intergovernmental revenues - -
Investment earnings 1 4
Miscellaneous - -
TOTAL REVENUES 1 4
EXPENDITURES:
Current:
General government - -
Parks, recreation and culture - -
Public works - -
Capital outlay - -
TOTAL EXPENDITURES - -
EXCESS OF REVENUES OVER
(UNDER) EXPENDITURES 1 4
OTHER FINANCING SOURCES (USES):
Transfers in - -
Transfers out - -
TOTAL OTHER FINANCING
SOURCES (USES)- -
NET CHANGE IN FUND BALANCES 1 4
FUND BALANCES - BEGINNING OF YEAR 20 639
FUND BALANCES - END OF YEAR 21$ 643$
- 178 -
CITY OF PALM DESERT
COMBINING STATEMENT OF REVENUES, EXPENDITURES
AND CHANGES IN FUND BALANCES
OTHER CAPITAL PROJECTS FUNDS
(CONTINUED)
For the year ended June 30, 2016
Schedule 15
Total
Capital Other
Capital Projects Economic Capital Projects
Golf Reserve Development Funds
-$ -$ -$ 691,059$
- 1,024,757 67,272 1,092,029
36,486 19,000 4,814 105,545
1,555,855 18,688 - 1,634,543
1,592,341 1,062,445 72,086 3,523,176
- 567,229 49,999 644,938
591,917 111,757 - 1,162,356
- 702 - 96,352
- 921,259 6,381 1,012,671
591,917 1,600,947 56,380 2,916,317
1,000,424 (538,502) 15,706 606,859
- - - 145,580
(776,000) - - (776,000)
(776,000) - - (630,420)
224,424 (538,502) 15,706 (23,561)
2,882,012 10,331,130 774,842 25,662,171
3,106,436$ 9,792,628$ 790,548$ 25,638,610$
- 179 -
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THIS PAGE INTENTIONALLY LEFT BLANK
-181 -
INTERNAL SERVICE FUNDS
Internal Service Funds are used to account for services are provided to other departments or agencies
of the City on a cost reimbursement basis.
Equipment Replacement -This fund is used to account for financial transactions related to replacement
of City-owned vehicles and equipment.
Compensation Benefits Fund -This fund is used to account for funding of compensated absences.
Schedule 16
Equipment Compensation
Replacement Benefits Total
ASSETS:
CURRENT ASSETS:
Cash and investments 6,637,855$ 2,414,793$ 9,052,648$
Receivables:
Accounts 4,560 - 4,560
TOTAL CURRENT ASSETS 6,642,415 2,414,793 9,057,208
CAPITAL ASSETS:
Nondepreciable 536,607 - 536,607
Depreciable, net 1,393,339 - 1,393,339
CAPITAL ASSETS, NET 1,929,946 - 1,929,946
TOTAL ASSETS 8,572,361 2,414,793 10,987,154
LIABILITIES:
CURRENT LIABILITIES:
Compensated absences - 300,000 300,000
TOTAL CURRENT LIABILITIES - 300,000 300,000
NONCURRENT LIABILITIES:
Compensated absences - 2,113,665 2,113,665
TOTAL NONCURRENT LIABILITIES - 2,113,665 2,113,665
TOTAL LIABILITIES - 2,413,665 2,413,665
NET POSITION:
Net investment in capital assets 1,929,946 - 1,929,946
Unrestricted 6,642,415 1,128 6,643,543
TOTAL NET POSITION 8,572,361$ 1,128$ 8,573,489$
CITY OF PALM DESERT
COMBINING STATEMENT OF NET POSITION
INTERNAL SERVICE FUNDS
June 30, 2016
- 182 -
Schedule 17
Equipment Compensation
Replacement Benefits Total
OPERATING REVENUES:
Miscellaneous 32,000$ -$ 32,000$
TOTAL OPERATING REVENUES 32,000 - 32,000
OPERATING EXPENSES:
Maintenance and operations 2,708 - 2,708
General and administrative - 292,876 292,876
Depreciation and amortization 267,481 - 267,481
TOTAL OPERATING EXPENSES 270,189 292,876 563,065
OPERATING LOSS (238,189) (292,876) (531,065)
NONOPERATING REVENUES:
Interest revenue 43,684 11,548 55,232
Gain on disposal of capital assets 24,292 - 24,292
TOTAL NONOPERATING REVENUES 67,976 11,548 79,524
LOSS BEFORE CAPITAL
CONTRIBUTIONS AND TRANSFERS (170,213) (281,328) (451,541)
CAPITAL CONTRIBUTIONS 11,691 - 11,691
TRANSFERS IN - 282,000 282,000
CHANGE IN NET POSITION (158,522) 672 (157,850)
NET POSITION - BEGINNING OF YEAR 8,730,883 456 8,731,339
NET POSITION - END OF YEAR 8,572,361$ 1,128$ 8,573,489$
For the year ended June 30, 2016
- 183 -
CITY OF PALM DESERT
COMBINING STATEMENT OF REVENUES, EXPENSES AND CHANGES IN FUND NET POSITION
INTERNAL SERVICE FUNDS
Schedule 18
Equipment Compensation
Replacement Benefits Total
CASH FLOWS FROM OPERATING ACTIVITIES:
Receipts from customers 32,000$ -$ 32,000$
Payments to employees - (552,353) (552,353)
Payments to suppliers (2,708) - (2,708)
NET CASH PROVIDED (USED)
BY OPERATING ACTIVITIES 29,292 (552,353) (523,061)
CASH FLOWS FROM NONCAPITAL AND
RELATED FINANCING ACTIVITIES:
Cash received from other funds - 282,000 282,000
NET CASH PROVIDED BY NONCAPITAL
AND RELATED ACTIVITIES - 282,000 282,000
CASH FLOWS FROM CAPITAL AND
RELATED FINANCING ACTIVITIES:
Purchases of capital assets (795,839) - (795,839)
Proceeds on sale of assets 35,940 - 35,940
NET CASH PROVIDED (USED) BY CAPITAL
AND RELATED FINANCING ACTIVITIES (759,899) - (759,899)
CASH FLOWS FROM INVESTING ACTIVITIES:
Interest and dividends 43,684 11,548 55,232
NET DECREASE IN CASH
AND CASH EQUIVALENTS (686,923) (258,805) (945,728)
CASH AND CASH EQUIVALENTS -
BEGINNING OF YEAR 7,324,778 2,673,598 9,998,376
CASH AND CASH EQUIVALENTS -
END OF YEAR 6,637,855$ 2,414,793$ 9,052,648$
(Continued)
CITY OF PALM DESERT
COMBINING STATEMENT OF CASH FLOWS
INTERNAL SERVICE FUNDS
For the year ended June 30, 2016
- 184 -
Schedule 18
Equipment Compensation
Replacement Benefits Total
RECONCILIATION OF OPERATING LOSS TO NET
CASH PROVIDED (USED) BY OPERATING ACTIVITIES:
Operating loss (238,189)$ (292,876)$ (531,065)$
Adjustments to reconcile operating loss to net
cash provided (used) by operating activities:
Depreciation and amortization 267,481 - 267,481
Changes in assets and liabilities:
Increase (decrease) in compensated absences - (259,477) (259,477)
NET CASH PROVIDED (USED)
BY OPERATING ACTIVITIES 29,292$ (552,353)$ (523,061)$
- 185 -
CITY OF PALM DESERT
(CONTINUED)
COMBINING STATEMENT OF CASH FLOWS
INTERNAL SERVICE FUNDS
For the year ended June 30, 2016
-186 -
THIS PAGE INTENTIONALLY LEFT BLANK
-187 -
AGENCY FUNDS
Agency Funds are used to account for assets held by the city as an agent for individuals, private
organizations, other governments and/or funds.
Agency Fund -This fund is used to account for deposits placed with the City by developers,
individuals and groups to obtain future services. Deposits are reduced by disbursements and/or refunds
to the depositors when the cost of services is determined.
Treasurers 1911 Bond Act -This fund is used to account for the assets held on behalf of the assessment
district’s property owners until they are remitted to the bondholders.
Retiree Service Stipend Fund -This fund is used to account for assets held to pay for the retiree service
stipend.
Special Assessment Funds -These funds are used to account for the collection of special assessments
and the future payment of debt service related to bonds issued.
Schedule 19
Special
Treasurers Retiree Service Assessment
Agency 1991 Bond Act Stipend Fund Funds Totals
Cash and investments 2,853,204$ 270,664$ 2,186,748$ 9,510,134$ 14,820,750$
Receivables (net of allowance
for uncollectibles):
Assessments - - - 60,437,964 60,437,964
Interest - - - 4,114 4,114
Due from other governments - - - 59,982 59,982
Prepaid costs - - - 812 812
Restricted assets:
Cash with fiscal agent - - - 5,466,224 5,466,224
TOTAL ASSETS 2,853,204$ 270,664$ 2,186,748$ 75,479,230$ 80,789,846$
Deposits 2,853,204$ 270,664$ 2,186,748$ 75,479,230$ 80,789,846$
TOTAL LIABILITIES 2,853,204$ 270,664$ 2,186,748$ 75,479,230$ 80,789,846$
COMBINING STATEMENT OF ASSETS AND LIABILITIES
ALL AGENCY FUNDS
June 30, 2016
CITY OF PALM DESERT
- 188 -
ASSETS
LIABILITIES
Schedule 20
Balance Balance
July 1, June 30,
2015 Additions Deletions 2016
ASSETS:
Cash and investments 1,772,907$ 3,693,353$ 2,613,056$ 2,853,204$
TOTAL ASSETS 1,772,907$ 3,693,353$ 2,613,056$ 2,853,204$
LIABILITIES:
Deposits 1,772,907$ 3,693,353$ 2,613,056$ 2,853,204$
TOTAL LIABILITIES 1,772,907$ 3,693,353$ 2,613,056$ 2,853,204$
ASSETS:
Cash and investments 270,664$ -$ -$ 270,664$
TOTAL ASSETS 270,664$ -$ -$ 270,664$
LIABILITIES:
Deposits 270,664$ -$ -$ 270,664$
TOTAL LIABILITIES 270,664$ -$ -$ 270,664$
ASSETS:
Cash and investments 2,344,796$ 914,197$ 1,072,245$ 2,186,748$
Due from other governments 420,471 - 420,471 -
TOTAL ASSETS 2,765,267$ 914,197$ 1,492,716$ 2,186,748$
LIABILITIES:
Deposits 2,765,267$ 914,197$ 1,492,716$ 2,186,748$
TOTAL LIABILITIES 2,765,267$ 914,197$ 1,492,716$ 2,186,748$
(Continued)
COMBINING STATEMENT OF CHANGES IN ASSETS AND LIABILITIES
ALL AGENCY FUNDS
For the year ended June 30, 2016
CITY OF PALM DESERT
RETIREE SERVICES STIPEND FUND
AGENCY
TREASURERS 1911 BOND ACT
- 189 -
Schedule 20
Balance Balance
July 1, June 30,
2015 Additions Deletions 2016
ASSETS:
Cash and investments 9,007,844$ 7,782,392$ 7,280,102$ 9,510,134$
Receivables (net of allowance for uncollectibles):
Assessements 84,632,764 - 24,194,800 60,437,964
Interest 3,053 4,114 3,053 4,114
Due from other governments 143,995 59,982 143,995 59,982
Prepaid costs 4,208 812 4,208 812
Restricted assets:
Cash with fiscal agent 7,363,290 19,611,610 21,508,676 5,466,224
TOTAL ASSETS 101,155,154$ 27,458,910$ 53,134,834$ 75,479,230$
LIABILITIES:
Deposits 101,155,154$ 27,458,910$ 53,134,834$ 75,479,230$
TOTAL LIABILTIES 101,155,154$ 27,458,910$ 53,134,834$ 75,479,230$
ASSETS:
Cash and investments 13,396,211$ 12,389,942$ 10,965,403$ 14,820,750$
Receivables (net of allowance for uncollectibles):
Accounts 84,632,764 - 24,194,800 60,437,964
Interest 3,053 4,114 3,053 4,114
Due from other governmets 564,466 59,982 564,466 59,982
Prepaid costs 4,208 812 4,208 812
Restricted assets:
Cash with fiscal agent 7,363,290 19,611,610 21,508,676 5,466,224
TOTAL ASSETS 105,963,992$ 32,066,460$ 57,240,606$ 80,789,846$
LIABILITIES:
Deposits 105,963,992$ 32,066,460$ 57,240,606$ 80,789,846$
TOTAL LIABILITIES 105,963,992$ 32,066,460$ 57,240,606$ 80,789,846$
- 190 -
TOTAL - ALL AGENCY FUNDS
SPECIAL ASSESSMENT FUNDS
CITY OF PALM DESERT
ALL AGENCY FUNDS
COMBINING STATEMENT OF CHANGES IN ASSETS AND LIABILITIES
For the year ended June 30, 2016
(CONTINUED)
-191 -
DESCRIPTION OF STAT ISTICAL SECTION CONTENTS
June 30, 2016
This part of the City of Palm Desert’s comprehensive annual financial report presents detailed
information as a context for understanding what the information in the financial statements, note
disclosures, and required supplementary information say about the City’s overall financial health.
Contents
Financial Trends
Theses schedules contain trend information to help the reader understand how the City’s
financial performance and well-being have changed over time.
Revenue Capacity
These schedules contain information to help the reader assess the City’s most significant
local revenue source, the property tax.
Debt Capacity
These schedules present information to help the reader assess the affordability of the
City’s current levels of outstanding debt and the City’s ability to issue additional debt in
the future.
Demographic and Economic Information
These schedules offer demographic and economic indicators to help the reader
understand the environment within which the City’s financial activities take place.
Operating Information
These schedules contain service and infrastructure data to help the reader understand
how the information in the City’s financial report relates to the services the City
provides and the activities it performs.
Sources:Unless otherwise noted, the information in these schedules is derived from the
comprehensive annual financial reports for the relevant year. The City implemented
GASB Statement 34 in 2001; schedules presenting government-wide information include information
beginning in that year.
City of Palm Desert
Net Position by Component
Last Ten Fiscal Years
(Accrual Basis of Accounting)
Governmental Activities 2016 2015 2014 2013 2012
Net Investment in capital assets 459,644,720 473,722,694 466,246,732 465,756,172 475,457,375
Restricted 193,298,431 135,900,520 140,460,575 132,741,798 119,736,419
Unrestricted 78,812,066 71,530,456 105,537,785 103,603,715 107,622,257
Total Governmental Activities Net Position 731,755,217 (5) 681,153,670 (4) 712,245,092 702,101,685 702,816,051 (3)
Business-Type Activities
Net Investment in capital assets 70,202,487 71,129,743 72,009,184 72,892,200 73,375,634
Restricted - - - - -
Unrestricted 4,479,575 4,302,958 3,920,382 3,682,061 3,901,816
Total Business-type Activities Net Position 74,682,062 75,432,701 75,929,566 76,574,261 77,277,450
Primary Government
Net Investment in capital assets 529,847,207 544,852,437 538,255,916 538,648,372 548,833,009
Restricted 193,298,431 135,900,520 140,460,575 132,741,798 119,736,419
Unrestricted 83,291,641 75,833,414 109,458,167 107,285,776 111,524,073
Total Primary Government Net Position 806,437,279 756,586,371 788,174,658 778,675,946 780,093,501
Governmental Activities 2011 2010 2009 2008 2007
Net Investment in capital assets 302,757,128 304,702,414 302,507,877 287,536,477 213,685,471
Restricted 147,648,424 143,394,780 159,157,317 161,360,654 173,335,615
Unrestricted 107,314,002 110,918,145 113,883,303 120,089,399 111,386,996
Total Governmental Activities Net Position 557,719,554 559,015,339 575,548,497 568,986,530 (2) 498,408,082 (1)
Business-Type Activities
Net Investment in capital assets 74,043,419 67,902,786 68,263,719 62,814,656 62,956,911
Restricted - - - - -
Unrestricted 4,068,623 4,391,160 4,686,899 5,211,985 5,294,980
Total Business-type Activities Net Position 78,112,042 72,293,946 72,950,618 68,026,641 68,251,891
Primary Government
Net Investment in capital assets 376,800,547 372,605,200 370,771,596 350,351,133 276,642,382
Restricted 147,648,424 143,394,780 159,157,317 161,360,654 173,335,615
Unrestricted 111,382,625 115,309,305 118,570,202 125,301,384 116,681,976
Total Primary Government Net Position 635,831,596 631,309,285 648,499,115 637,013,171 566,659,973
(1)The increase for FY 2007 is due to issuance of District Bond, see Note 13.
(2) The increase for FY 2008 is due to Capital Contribution of Hwy 111 & Hwy 74 infrastructure totaling $30.19 million from the State of California.
(3) On February 1, 2012 the State of California dissolved the City of Palm Desert Redevelopment Agency as part of the Statewide dissolution of all
City Redevelopment Agencies, which in turn created the Successor Agency to the Redevelopment Agency of the City of Palm Desert.
(4) The implementation of GASB Statement No. 68 and Statement No. 71 resulted in a prior year restatement decrease of $37.73 million in the
governmental activities net positons.
(5) The City's Capital Properties Capital Project Fund received $65,566,963 and the Low and Moderate Income Housing Asset Special Revenue Fund
received $6,571,706 for a combined total of $72,138,669 of capital bond proceeds transferred from the Successor Agency, See Note 19.
192
City of Palm Desert
Changes in Net Position
Last Ten Fiscal Years
(Accrual Basis of Accounting)
Governmental Activities:
General government 14,836,881 16,337,393 19,194,343 16,375,295 17,387,080
Public safety 34,009,984 32,077,635 29,339,106 28,614,153 28,037,453
Housing & Redevelopment (1) 8,162,859 11,666,724 7,852,611 6,944,033 10,519,663
Parks, recreation and culture 9,223,126 8,598,242 8,327,402 8,752,623 6,033,019
Public works 47,044,197 19,144,213 21,123,197 16,316,237 17,407,751
Payments to other agencies - - - - 16,994,265
Interest on long term debt 289,000 294,258 237,053 253,381 10,971,707
Total Governmental activities Expenses 113,566,047 88,118,465 86,073,712 77,255,722 107,350,938
Business-Type Activities:
Desert Willow Golf Course 8,165,183 8,433,267 8,452,001 8,655,754 8,471,567
Office Complex - Parkview 1,005,918 934,296 922,341 984,811 1,031,178
Total Business-Type Activities 9,171,101 9,367,563 9,374,342 9,640,565 9,502,745
Total primary government expenses 122,737,148 97,486,028 95,448,054 86,896,287 116,853,683
Program Revenues
Governmental Activities
Charges for services
General government 2,185,123 2,088,393 2,152,280 1,833,823 1,805,442
Housing & Redevelopment 7,029,595 7,971,265 6,851,603 5,308,858 5,034,002
Public safety 10,606,464 9,987,891 10,239,886 11,147,297 9,041,801
Parks, recreation and culture 772,801 772,728 729,076 898,222 728,721
Public works 2,186,153 1,832,241 2,180,877 768,775 826,251
Operating grants & contributions 9,496,520 7,512,894 9,745,609 5,876,028 7,411,902
Capital grants & contributions 10,839,715 19,297,015 21,086,051 7,733,439 2,309,678
Total Governmental Activities Program Revenues 43,116,371 49,462,427 52,985,382 33,566,442 27,157,797
Business-Type Activities
Charges for Service:
Desert Willow Golf Course 7,240,866 7,894,676 7,804,904 7,494,819 7,635,352
Office Complex - Parkview 1,280,230 1,306,042 1,254,521 1,215,860 1,222,971
Capital grants & contributions 111,942 47,768 94,076 660,685 236,419
Total Business-type activities program revenue 8,633,038 9,248,486 9,153,501 9,371,364 9,094,742
Total Primary Government program revenue 51,749,409 58,710,913 62,138,883 42,937,806 36,252,539
Net (Expense) / Revenue
Governmental activities (70,449,676) (38,656,038) (33,088,330) (43,689,280) (80,193,141)
Business-type activities (538,063) (119,077) (220,841) (269,201) (408,003)
Total Primary Government Net Expense (70,987,739) (38,775,115) (33,309,171) (43,958,481) (80,601,144)
General Revenues & Other Changes in Net Position
Governmental Activities:
Taxes: (Combined/Net Pass-through) 44,747,151 41,931,997 39,952,738 38,742,060 73,105,614
Investment Earnings 2,074,934 494,452 358,674 318,996 1,102,309
Contributions not restricted for specific purpose - - - - 791,256
Gain(loss) on sales of capital assets 24,292 11,720 488,319 - -
Miscellaneous 1,828,677 1,726,007 1,994,506 3,894,203 5,838,881
Refunding of special assessment debt - - - - -
Transfers In / (Out) 237,500 437,500 437,500 437,500 440,000
Gain on Transfer to Successor Agency/ Extraordinary Gain (4)72,138,669 - - - 144,011,578
Total Governmental activities Net Revenues 121,051,223 44,601,676 43,231,737 43,392,759 225,289,638
Business-Type Activities:
Investment Earnings 24,924 11,774 13,646 3,512 13,411
Gain(loss) on sales of capital assets - 47,938 - - -
Transfers Out (237,500) (437,500) (437,500) (437,500) (440,000)
Total Business-type activities (212,576) (377,788) (423,854) (433,988) (426,589)
Total primary government 120,838,647 44,223,888 42,807,883 42,958,771 224,863,049
Change in Net Position
Governmental Activities: 50,601,547 5,945,638 10,143,407 (296,521) 145,096,497
Business-Type Activities: (750,639) (496,865) (644,695) (703,189) (834,592)
Total primary government 49,850,908 5,448,773 9,498,712 (999,710) 144,261,905
(1)City has changed the manner in which it reports RDA expenditures. RDA and Housing expenditures are being reported under "Housing & Redevelopment".
(2) Required payment made to the State of California. For FY 2010 was $25,526,215 and FY 2011 was $5,255,397.
(3) On February 1, 2012 the State of California dissolved the City of Palm Desert Redevelopment Agency as part of the Statewide dissolution of all
City Redevelopment Agencies, which in turn created the Successor Agency to the Redevelopment Agency of the City of Palm Desert.
(4) The City's Capital Properties Capital Project Fund received $65,566,963 and the Low and Moderate Income Housing Asset Special Revenue Fund
received $6,571,706 for a combined total of $72,138,669 of capital bond proceeds transferred from the Successor Agency, See Note 19.
Expenses 2015 2014 2013 2012 (3)2016
193
City of Palm Desert
Changes in Net Position
Continued
Last Ten Fiscal Years
(Accrual Basis of Accounting)
Governmental Activities:
General government 17,182,987 16,701,292 17,328,291 21,953,229 11,659,965
Public safety 26,601,668 27,027,643 27,670,237 26,855,060 24,674,424
Housing & Redevelopment (1) 15,976,383 16,220,066 16,760,877 24,095,414 28,296,802
Parks, recreation and culture 7,337,403 7,312,679 7,210,706 8,013,211 4,996,692
Public works 16,984,334 19,900,937 22,036,017 27,245,937 37,091,512
Payments to other agencies 39,418,936 63,320,650 39,085,940 38,993,445 35,719,075
Interest on long term debt 18,989,167 20,069,813 20,128,441 20,706,514 20,097,198
Total Governmental Activities Expenses 142,490,878 170,553,080 150,220,509 167,862,810 162,535,668
Business-Type Activities:
Desert Willow Golf Course 7,946,063 7,832,690 7,804,265 8,167,682 7,989,321
Office Complex - Parkview 861,786 875,394 852,746 649,548 716,592
Total Business-Type Activities 8,807,849 8,708,084 8,657,011 8,817,230 8,705,913
Total primary government expenses 151,298,727 179,261,164 158,877,520 176,680,040 171,241,581
Program Revenues
Governmental Activities
Charges for services
General government 1,921,573 2,127,138 7,574,059 8,454,683 8,225,112
Housing & Redevelopment 4,935,422 4,986,066 - - -
Public safety 9,825,352 9,431,478 9,396,435 8,808,300 9,078,214
Parks, recreation and culture 768,786 618,440 803,218 1,190,725 1,822,685
Public works 762,015 706,374 701,125 762,440 514,838
Operating grants & contributions 5,675,777 6,558,892 5,582,470 5,843,010 7,951,650
Capital grants & contributions 2,255,393 2,722,312 5,048,666 42,545,033 57,132,742
Total Governmental Activities Program Revenues 26,144,318 27,150,700 29,105,973 67,604,191 84,725,241
Business-Type Activities
Charges for Service:
Desert Willow Golf Course 7,338,640 7,054,263 6,872,935 8,182,741 7,830,863
Office Complex - Parkview 1,217,985 988,056 958,942 934,833 915,975
Capital grants & contributions - - - 206,609 278,757
Total Business-type activities program revenue 8,556,625 8,042,319 7,831,877 9,324,183 9,025,595
Total Primary Government program revenue 34,700,943 35,193,019 36,937,850 76,928,374 93,750,836
Net (Expense) / Revenue
Governmental Activities (116,346,560) (143,402,380) (121,114,536) (100,258,619) (77,810,427)
Business-type activities (251,224) (665,765) (825,134) 506,953 319,682
Total Primary Government Net Expense (116,597,784) (144,068,145) (121,939,670) (99,751,666) (77,490,745)
General Revenues & Other Changes in Net Position
Governmental Activities:
Taxes: (Combined/Net Pass-through) 114,880,586 120,872,421 123,650,887 129,521,410 122,485,939
Investment Earnings 2,158,556 2,916,753 6,161,309 15,309,271 17,521,600
Contributions not restricted for specific purpose 762,588 644,603 613,648 7,240,770 -
Gain(loss) on sales of assets - - - - -
Miscellaneous 3,169,977 2,382,208 2,912,180 6,369,028 10,790,417
Refunding of special assessment debt - - - - -
Transfers In / (Out) (6,046,761) 53,237 (5,661,521) 1,000,000 -
Gain on Transfer to Successor Agency/Extraordinary Gain (4) - - - - -
Total Governmental Activities Net Revenues 114,924,946 126,869,222 127,676,503 159,440,479 150,797,956
Business-Type Activities:
Investment Earnings 22,559 62,330 87,590 267,797 239,290
Transfers Out 6,046,761 (53,237) 5,661,521 (1,000,000) -
Total Business-type activities 6,069,320 9,093 5,749,111 (732,203) 239,290
Total primary government 120,994,266 126,878,315 133,425,614 158,708,276 151,037,246
Change in Net Position
Governmental Activities: (1,421,614) (16,533,158) 6,561,967 59,181,860 72,987,529
Business-Type Activities: 5,818,096 (656,672) 4,923,977 (225,250) 558,972
Total primary government 4,396,482 (17,189,830) 11,485,944 58,956,610 73,546,501
(1)City has changed the manner in which it reports RDA expenditures. RDA and Housing expenditures are being reported under "Housing & Redevelopment".
(2) Required payment made to the State of California. For FY 2010 was $25,526,215 and FY 2011 was $5,255,397.
(3) On February 1, 2012 the State of California dissolved the City of Palm Desert Redevelopment Agency as part of the Statewide dissolution of all
City Redevelopment Agencies, which in turn created the Successor Agency to the Redevelopment Agency of the City of Palm Desert.
(4) The City's Capital Properties Capital Project Fund received $65,566,963 and the Low and Moderate Income Housing Asset Special Revenue Fund
received $6,571,706 for a combined total of $72,138,669 of capital bond proceeds transferred from the Successor Agency, See Note 19.
Expenses 2010 (2)2009 2008 20072011 (2)
194
City of Palm Desert
Fund Balances of Governmental Funds
Last Ten Fiscal Years
(Modified Accrual Basis of Accounting)
General Fund: 2016 2015 2014 2013 2012
Nonspendable 9,528,630 10,312,261 7,745,320 7,678,250 2,926,739
Restricted - - - - -
Committed - - - - -
Assigned 991,853 1,771,278 4,425,423 3,224,761 3,297,152
Unassigned 71,842,172 67,727,130 66,203,203 65,311,919 69,438,971
Total General Fund 82,362,655 79,810,669 78,373,946 76,214,930 75,662,862
All other Governmental Funds:
Nonspendable 3,052 348 6,713 (5) 49,319,200 39,525,247
Restricted 165,411,544 (6) 106,261,212 114,194,435 (5) 76,725,388 69,065,451
Committed 16,873,834 16,952,887 21,644,068 15,649,703 20,289,309
Assigned 23,776,468 24,172,531 24,429,824 14,144,969 17,552,726
Unassigned - - - - -
Total all other Governmental Funds 206,064,898 147,386,978 160,275,040 155,839,260 146,432,733 (4)
General Fund: 2011 2010 2009 2008 2007
Nonspendable 2,939,850 (1) 9,676,961 (1) 11,629,384 11,897,843 22,199,914
Restricted - - - - -
Committed - - - - -
Assigned 4,501,159 4,044,421 3,654,300 4,406,391 2,998,204
Unassigned 66,776,414 63,847,586 59,066,988 63,515,054 50,916,281
Total General Fund 74,217,423 77,568,968 74,350,672 79,819,288 76,114,399
All other Governmental Funds:
Nonspendable 40,925,918 41,050,481 23,361,744 23,141,729 35,511,735
Restricted 230,623,054 260,163,043 296,323,735 299,960,611 318,529,973
Committed 17,285,733 (3) 8,871,910 (3) 4,559,739 (2) 18,487 (2) 9,000
Assigned 19,375,999 16,432,292 23,812,325 26,512,084 27,344,381
Unassigned - - (2,392) - (55,684)
Total all other Governmental Funds 308,210,704 (4) 326,517,726 (4) 348,055,151 349,632,911 381,339,405
(1) RDA made payment on advances from the city.
(2) Start of new Energy program that loaned residents funds for energy efficiency.
(3) RDA Low Income Housing fund transfer for Capital Asset replacement to the Housing Authority.
(4) On February 1, 2012 the State of California dissolved the City of Palm Desert Redevelopment Agency as part of the Statewide dissolution of all
City Redevelopment Agencies, which in turn created the Successor Agency to the Redevelopment Agency of the City of Palm Desert.
(5) Advances to the Successor Agency reclassified from Nonspendable to Restricted for Special Revenue Funds.
(6) The City's Capital Properties Capital Project Fund received $65,566,963 and the Low and Moderate Income Housing Asset Special Revenue Fund
received $6,571,706 for a combined total of $72,138,669 of capital bond proceeds transferred from the Successor Agency, See Note 19.
195
City of Palm Desert
Changes in Fund Balances of Governmental Funds
Last Ten Fiscal Years
(Modified Accrual Basis of Accounting)
Revenues: 2016 2015 2014 2013 2012 (1)
Taxes 56,735,503 52,571,369 50,464,511 50,768,200 82,901,921
Special assessments collected 3,296,705 3,058,766 3,486,220 3,654,337 3,232,923
Licenses & permits 2,057,843 1,757,250 2,262,907 1,586,796 1,041,834
Intergovernmental revenues 15,429,238 18,981,304 7,380,744 5,097,892 6,637,426
Rental income 5,896,480 5,660,762 5,626,850 5,367,630 5,146,499
Charges for services 2,082,843 1,819,464 2,165,020 898,222 728,721
Investment Earnings 1,837,319 1,242,662 864,853 373,012 1,469,142
Fines & forfeitures 295,269 224,612 231,768 242,568 276,452
Miscellaneous 2,317,499 2,377,923 3,539,552 9,028,698 6,814,924
Contributions from other government - 9,168 10,749,218 - -
Contributions from property owners 7,868 - 420,590 - -
Total Revenues 89,956,567 87,703,280 87,192,233 77,017,355 108,249,842
Expenditures:
General government 15,783,955 15,467,746 17,070,816 14,028,252 15,851,883
Housing & redevelopment 6,438,849 9,349,021 6,650,178 5,650,666 8,942,097
Pass-through-agreement - - - - 16,994,265
Public safety 33,750,347 31,819,214 29,139,735 28,299,876 27,551,113
Parks, recreation & culture 6,831,534 6,236,717 5,802,941 6,162,449 3,685,334
Public works 11,031,584 13,082,388 12,741,764 9,819,591 11,306,021
Contributions to property owners 19,584,487 49 2,350,187 - -
Capital outlay 7,071,738 19,339,987 6,273,822 2,788,676 9,575,227
Debt service:
Principal retirement 257,000 4,944,000 674,000 318,000 9,032,707
Interest and fiscal charges 296,336 240,219 242,495 255,239 10,187,765
Total Expenditures 101,045,830 100,479,341 80,945,938 67,322,749 113,126,412
Excess(deficiency of Revenues
over(under) expenditures (11,089,263) (12,776,061) 6,246,295 9,694,606 (4,876,570)
Other financing sources (uses)
Transfers in 6,030,706 6,132,859 4,861,551 11,274,539 24,453,724
Transfers out (6,075,206) (6,971,359) (5,424,051) (11,010,550) (24,013,724)
Bond Premiums - - - - -
Bonds issued/Capital Accreation on bonds - - - - -
Payment refunded bond escrow agent - - - - -
Extraordinary Gain / (Loss) (2) 72,138,669 - - - (155,895,962)
Sale of property 225,000 2,163,222 911,001 - -
Total Other financing sources (uses)72,319,169 1,324,722 348,501 263,989 (155,455,962)
Net Change In Fund Balance 61,229,906 (11,451,339) 6,594,796 9,958,595 (160,332,532)
Revenues: 2011 2010 2009 2008 2007
Taxes 124,672,062 130,655,949 134,060,681 140,331,466 138,272,454
Special assessments collected 3,262,163 3,182,549 2,759,444 2,060,791 929,348
Licenses & permits 1,089,543 782,271 1,383,778 1,453,177 2,691,486
Intergovernmental revenues 7,605,282 8,700,234 9,543,551 18,996,692 23,499,937
Rental income 5,011,205 5,023,770 5,050,479 4,789,421 4,513,146
Charges for services 701,481 618,440 803,218 1,190,725 1,822,685
Investment Earnings 3,102,649 4,681,243 8,322,808 22,592,392 23,985,001
Fines & forfeitures 310,840 343,054 315,284 254,857 274,365
Miscellaneous 3,095,689 3,374,309 3,479,370 20,164,099 2,847,802
Contributions from other government - - - - -
Contributions from property owners - - - - 46,006,292
Total Revenues 148,850,914 157,361,819 165,718,613 211,833,620 244,842,516
Expenditures:
General government 15,273,085 19,294,744 18,950,675 24,776,785 18,231,351
Housing & redevelopment 18,033,576 13,612,720 14,359,340 38,018,819 26,356,634
Pass-through-agreement 39,418,936 63,320,650 39,085,941 38,993,445 35,719,075
Public safety 26,824,434 26,882,787 26,906,123 26,677,743 24,550,431
Parks, recreation & culture 3,845,901 4,534,505 5,122,900 4,572,695 3,921,063
Public works 11,256,499 13,971,797 16,241,963 22,936,721 33,925,623
Contributions to property owners - - - - -
Capital outlay 14,205,889 6,333,521 22,348,953 52,256,552 85,604,515
Debt service:
Principal retirement 22,914,707 15,250,707 12,778,707 10,767,707 8,209,707
Interest and fiscal charges 18,176,454 19,280,517 19,424,623 23,376,564 25,814,526
Total Expenditures 169,949,481 182,481,948 175,219,225 242,377,031 262,332,925
Excess(deficiency of Revenues
over(under) expenditures (21,098,567) (25,120,129) (9,500,612) (30,543,411) (17,490,409)
Other financing sources (uses)
Transfers in 69,995,597 59,960,402 68,088,670 59,723,636 249,249,847
Transfers out (70,555,597) (59,520,402) (67,649,434) (58,723,636) (249,249,847)
Bond Premiums - - - - 7,785,375
Bonds issued/Capital Accreation on bonds 6,361,000 - - 287,534,894
Payment refunded bond escrow agent - - 2,015,000 1,484,806 (101,656,501)
Extraordinary Gain / (Loss) (2) - - - - -
Sale of property - - - 47,000 5,230,000
Total Other financing sources (uses)(560,000) 6,801,000 2,454,236 2,531,806 198,893,768
Net Change In Fund Balance (21,658,567) (18,319,129) (7,046,376) (28,011,605) 181,403,359
26.4% 19.6% 21.1% 18.0% 19.3%
(1) On February 1, 2012 the State of California dissolved the City of Palm Desert Redevelopment Agency as part of the Statewide dissolution of all
City Redevelopment Agencies, which in turn created the Successor Agency to the Redevelopment Agency of the City of Palm Desert.
For more information on the dissolution of the RDA please see Note 17 and 18.
(2) The City's Capital Properties Capital Project Fund received $65,566,963 and the Low and Moderate Income Housing Asset Special Revenue Fund
received $6,571,706 for a combined total of $72,138,669 of capital bond proceeds transferred from the Successor Agency, See Note 19.
0.9% 18.6%
Debt service as a percentage of noncapital
expenditures
Debt service as a percentage of noncapital
expenditures 6.4% 1.2%0.6%
196
City of Palm Desert
Graphs - Changes in Fund Balances of Governmentals Funds
Last Ten Fiscal Years
(Modified Accrual Basis of Accounting)
(1) Combined Other is a combination of rental income, investment earnings, and charges for services.
(2) Miscellaneous Other is a combination of fines and forefeitures, miscellaneous, contributions from other governments, and contributions from property owners.
(3) Debt Expenditures is a combination of interest/fiscal charges and principal retirement .
(4) Public works is a combination of public works and contributions to property owners.
Note: Graphs excludes Other financing sources and uses.
$0
$50,000,000
$100,000,000
$150,000,000
$200,000,000
$250,000,000
$300,000,000
FY 2016FY 2015FY 2014FY 2013FY 2012FY 2011FY 2010FY 2009FY 2008FY 2007Total Revenues
Combined other (1)
Miscellaneous other (2)
Intergovernmental revenues
Licenses & permits
Taxes & Special Assessments
$0
$50,000,000
$100,000,000
$150,000,000
$200,000,000
$250,000,000
$300,000,000
FY 2016FY 2015FY 2014FY 2013FY 2012FY 2011FY 2010FY 2009FY 2008FY 2007Total Expenditures
Parks, recreation & culture
Pass-through-agreement
Debt Expenditures (3)
Capital outlay
Public works (4)
Public safety
Housing & Redevelopment
General Government
197
City of Palm Desert
Supplemental - Historical General Fund Revenues
(Including Transfers In)
Last Ten Fiscal Years
FY 2016 2015 2014 2013 2012
Revenue Type:
Sales Tax 18,994,779$ 17,565,134$ 17,258,958$ 16,764,808$ 15,836,953$
Transient Occupancy Tax 11,252,997 10,799,680 9,855,509 9,188,981 8,085,225
Property Tax (3)10,461,595 9,710,990 9,041,428 9,529,018 7,976,494
Investment Earnings 725,015 416,656 405,456 126,206 408,661
Transfer In 1,390,258 2,179,472 1,373,786 2,127,655 2,240,703
Franchises 3,095,873 3,102,431 3,007,215 2,892,805 2,856,679
State Subventions (1) (3)59,317 155,049 22,089 26,691 25,759
Building & Grading Permits 1,216,115 1,279,706 1,695,303 1,206,935 750,442
Reimbursments (4)1,589,511 1,604,707 1,809,323 1,868,804 2,535,977
Business License Tax 1,269,082 1,160,207 1,169,316 1,149,551 1,076,541
Timeshare Mitigation Fee 1,500,683 1,483,158 1,333,586 1,292,859 1,110,227
Plan Check Fees 592,818 505,370 662,893 500,698 275,728
Property Transfer Tax 491,060 558,965 530,556 520,393 485,040
Other Revenues (2)2,189,063 1,713,758 1,932,009 1,961,314 1,398,669
Total General Revenue 54,828,166$ 52,235,283$ 50,097,427$ 49,156,718$ 45,063,098$
FY 2011 2010 2009 2008 2007
Revenue Type:
Sales Tax 14,680,578$ 13,273,793$ 14,474,933$ 17,195,743$ 17,918,375$
Transient Occupancy Tax 7,421,769 6,848,132 7,030,048 8,605,714 8,627,221
Property Tax (3)8,341,728 8,707,567 8,776,917 9,333,842 8,714,568
Investment Earnings 793,461 1,766,868 2,142,915 4,571,147 4,890,891
Transfer In 2,691,634 4,747,672 2,684,568 1,101,610 1,122,224
Franchises 2,771,594 2,705,902 2,818,729 2,887,727 2,907,062
State Subventions (1) (3)236,211 151,489 173,448 220,785 267,595
Building & Grading Permits 783,031 575,852 950,805 975,296 1,476,290
Reimbursments (4)1,971,505 2,488,378 3,263,247 4,933,807 2,465,685
Business License Tax 1,085,411 1,071,997 1,258,688 1,311,090 1,231,587
Timeshare Mitigation Fee 1,192,490 1,483,220 949,871 881,350 782,739
Plan Check Fees 317,332 224,325 389,770 562,930 617,999
Property Transfer Tax 399,280 455,580 324,817 604,236 671,806
Other Revenues (2)1,475,154 1,567,651 1,601,947 1,900,529 2,436,664
Total General Revenue 44,161,178$ 46,068,426$ 46,840,703$ 55,085,806$ 54,130,706$
(1) State Subventions is any combination of motor vehicle and off-highway in-lieus, and subventions from state.
(2) Other Revenues is any combination of miscellaneous penalties and interest, permits, grants, parking bails, fees,
sales of maps and publications, vehicle and court fines, rental income and other revenues.
(3) The State of California reprogramed motor vehicle fees, the City now receives this as property taxes.
(4) Reimbursements is a combination of RDA costs and other reimbursements, due to dissolution in February 2012 the RDA reimbursement
is limited and applies to existing projects.
198
City of Palm Desert
Supplemental Graph - Historical General Fund Revenues
(Including Transfers In)
Last Ten Fiscal Years
(1) Combined Other is any combination of transfers, franchises, state subventions*, building and grading
permits, reimbursements, business license taxes, timeshare mitigation fees, plan check fees, property
transfer taxes. It also may include any combination of miscellaneous bails, fees, fines, grants,
incomes, penalties, permits, sales and taxes.
*State Subventions is any combination of motor vehicle and off-highway in-lieus, and
subventions from state.
$0
$10,000,000
$20,000,000
$30,000,000
$40,000,000
$50,000,000
$60,000,000
$70,000,000
FY 2016 FY 2015 FY 2014 FY 2013 FY 2012 FY 2011 FY 2010 FY 2009 FY 2008 FY 2007Combined Other (1)
Interest
Property Tax
Transient Occupancy Tax
Sales Tax
199
City of Palm Desert
Supplemental - Historical General Fund Expenditures
(Including Transfers Out)
Last Ten Fiscal Years
FY 2016 2015 2014 2013 2012
Expenditure:
Public Safety (1)20,151,237$ 18,784,117$ 17,306,342$ 17,002,291$ 16,532,894$
City Administration (2)7,971,706 7,561,255 7,413,578 7,180,519 7,670,377
Public Works Administration 2,664,871 2,645,443 2,556,967 2,528,131 2,527,817
Community Promotions 791,565 749,631 618,138 575,119 526,804
Street Maintenance 2,709,328 2,631,590 2,806,168 2,353,655 2,446,854
Building Safety 1,888,290 1,847,798 1,783,918 1,517,937 1,538,506
Street Resurfacing 1,083,919 998,463 4,466 1,179,743 2,332,968
Public Works (4)1,004,989 1,067,837 1,018,435 1,505,018 1,056,998
Other Expenditures (3)14,010,275 14,512,426 14,430,399 14,762,237 8,984,441
Total Expenditures 52,276,180$ 50,798,560$ 47,938,411$ 48,604,650$ 43,617,659$
FY 2011 2010 2009 2008 2007
Expenditure:
Public Safety (1)16,047,991$ 15,671,095$ 16,266,052$ 14,413,196$ 13,404,056$
City Administration (2)8,023,314 8,556,627 10,076,543 9,861,106 8,588,341
Public Works Administration 2,380,255 3,021,319 3,720,106 3,329,792 3,014,583
Community Promotions 497,366 990,505 1,798,860 2,532,637 2,402,435
Street Maintenance 2,522,117 2,565,567 2,183,445 2,133,448 1,968,849
Building Safety 1,523,748 1,756,589 2,082,996 3,260,855 3,084,015
Street Resurfacing 2,268,901 708,006 1,115,721 3,342,542 1,192,629
Public Works (4)1,354,255 1,278,983 1,552,242 1,348,012 1,204,079
Other Expenditures (3)12,894,776 8,301,439 13,513,354 11,159,329 17,989,005
Total Expenditures 47,512,723$ 42,850,130$ 52,309,319$ 51,380,917$ 52,847,992$
(1) Public Safety is any combination of animal regulation, police services, and traffic safety expenditures, this does not include the cost
for Fire Services. Fire Services are reported in a different fund.
(2) City Administration is any combination of community services, auditing, City attorney, City clerk, City council and
City manager, information technology, elections, finance, general services, human resources, insurance, legal special services,
legislative advocacy, retiree health and unemployment insurance expenditures.
(3) Other Expenditures is any combination of acquisitions, committees, contributions, community
development, marketing, interfund transfers, parks, recreation and culture, extraordinary loss and visitor center,
included in the transfer out is transfer to the Fire fund for its shortfall.
(4) Public Works is a combination of curb & gutter, parking lot, storm drain, stripping, corporate yard
equipment, building maintenance, Portola Community center, storm water permit.
200
City of Palm Desert
Supplemental Graph - Historical General Fund Expenditures
(Including Transfers Out)
Last Ten Fiscal Years
(1) "Combined Other" is any combination of street maintenance, building safety, street resurfacing and public
works. It may also be aquisitions, centers, committees, contributions, community development,
marketing, interfund transfers, parks, recreation and culture, visitor center.
(2) City Administration is any combination of community services, auditing, City attorney, City clerk, City council and
City manager, information technology, elections, finance, general services, human resources, insurance, legal special services,
legistlative advocacy, retiree health and unemployment insurance expenditures.
(3) Other Expenditures is any combination of aquisitions, committees, contributions, community
development, marketing, interfund transfers, parks, recreation and culture, extraordinary loss and visitor center.
(4) Public Works is a combination of curb & gutter,parking lot, storm drain, stripping,corporate yard
equipment, building maintenance, Portola Community center, storm water permit.
$0
$10,000,000
$20,000,000
$30,000,000
$40,000,000
$50,000,000
$60,000,000
FY 2016 FY 2015 FY 2014 FY 2013 FY 2012 FY 2011 FY 2010 FY 2009 FY 2008 FY 2007Combined Other (1)
Community Promotions
Public Works Administration
City Administration (2)
Public Safety (3)
201
City of Palm Desert
Supplemental Historical General Revenue and Expenditures Per Capita
Last Ten Fiscal Years
FY 2016 2015 2014 2013 2012
Total General Revenue (2)53,437,908$ 50,055,811$ 48,723,641$ 47,029,063$ 42,822,395$
Population (1)49,335 51,053 50,417 49,949 49,471
General Revenue Per Capita 1,083 980$ 966$ 942$ 866$
FY 2011 2010 2009 2008 2007
Total General Revenue (2)41,469,544$ 41,320,754$ 44,156,135$ 53,984,196$ 53,008,482$
Population (1)49,111 52,067 51,509 50,907 49,752
General Revenue Per Capita 844$ 794$ 857$ 1,060$ 1,065$
FY 2016 2015 2014 2013 2012
Total General Expenditures (2)48,134,252$ 46,302,187$ 44,183,659$ 42,155,428$ 42,099,903$
Population (1)49,335 51,053 50,417 49,949 49,471
General Expenditures Per
Capita 976 907$ 876$ 844$ 851$
FY 2011 2010 2009 2008 2007
Total General Expenditures (2)41,833,291$ 42,499,812$ 48,696,321$ 49,238,257$ 43,565,108$
Population (1)49,111 52,067 51,509 50,907 49,752
General Expenditures Per
Capita 852$ 816$ 945$ 967$ 876$
(1) Population figures are as of January start of fiscal year.
(2) Interfund Transfers In/Out and extraordinary loss (gain) are not included in total.
Sources: Population figures from State Department of Finance, City of Palm Desert Finance Departmen
202
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203
City of Palm Desert
Assessed Value and Estimated Actual Value of Taxable Property
Last Ten Fiscal Years
Fiscal Year
Ended June 30
Residential
Property
Commercial
Industrial
Property
Institutional
Property Vacant Land Less: Tax
Exempt
Total Taxable
Assessed Value
Total Direct
Tax Rate
Estimated Actual
Taxable Value (1)
2016 10,174,360,142 2,358,860,033 56,840,001 412,090,006 (312,620,004) 14,210,000,198 1.00000 13,743,682,041
2015 9,636,181,445 2,290,456,630 54,211,991 420,142,932 (298,165,952) 13,552,997,813 1.00000 13,086,962,905
2014 9,043,372,632 2,247,924,054 64,595,519 426,330,424 (297,139,386) 12,919,103,760 1.00000 12,453,921,285
2013 8,621,493,305 2,239,836,432 62,565,263 462,982,950 (300,313,265) 12,513,052,693 1.00000 12,064,845,537
2012 8,694,403,021 2,198,729,088 50,256,665 452,309,984 (288,975,823) 12,564,166,215 1.00000 12,123,771,853
2011 8,982,403,643 2,179,940,065 52,528,676 564,683,270 (288,907,720) 13,132,169,069 1.00000 12,707,884,566
2010 9,210,638,643 2,419,511,046 54,988,887 426,163,878 (274,944,437) 13,747,221,855 1.00000 13,334,233,975
2009 9,376,213,348 2,130,957,579 127,857,455 667,700,041 (255,714,909) 14,206,383,860 1.00000 13,808,181,235
2008 9,160,443,514 1,929,224,481 134,910,803 688,045,095 (242,839,445) 13,491,080,286 1.00000 13,114,105,220
2007 8,931,447,910 1,684,439,737 143,634,396 639,825,947 (248,095,775) 13,057,672,383 1.00000 11,853,797,089
(1) Estimated Actual Taxable Value = Net Taxable Value
Notes: Property Taxes in Riverside County are subject to the State of California's Proposition 13, Jarvis-Gann Initiative which allows reappraisals of real property only
when there is a change in ownership or new construction takes place. Further, the proposition limits property assessment increase to no more than two(2%) percent
annually. Property is assessed at one hundred percent (100%) of its fair market value at the time of new construction or change in ownership.
The tax rate is one (1%) percent of the assessed value.
Source: Riverside County Assessor thru HDL Coren & Cone
204
City of Palm Desert
Historical Net Assessed Taxable Values Citywide
Graph - Assessed Valuation Growth
Last Ten Fiscal Years
Historical Major Additions
Annexations FY Retail Centers FY
Cook Street Area 88/89 Town Center Mall 83/84
Country Club #28 93/94 Desert Springs Marriott 86/87
Price Club/Costco 93/94 One Eleven Town Ctr 88/89
Palm Desert CC #29 94/95 Mervyn's Center 92/93
Palm Desert Greens 04/05 Desert Crossing 95/96
Suncrest 04/05 Lucky's/Albertson Deep Canyon 96/97
Remodel 111 Town Ctr (Best Buy) 97/98
Gardens on El Paseo 98/99
Remodel Westfield Mall (Sears, Barnes & Noble) 04/05
Sears Automotive 04/05
Lowes Home Improvement 05/06
Walmart / Sams Supercenters 05/06
Kohls 07/08
Golfsmith Extreme 08/09
El Paseo Village 09/10
Best Buy & Ulta 11/12
Remodel Westfield Mall (Dick's/H&M/Restaurants) 12/13
PGA Tour Superstore 12/13
Total Wine & More 13/14
Tesla Motors 15/16
Source: Riverside County Assessor thru HDL Coren & Cone
12.86%
10.63%
5.29%
-3.43%
-4.70%-4.60%
-0.49%
3.22%5.08%5.02%
-5.00%
0.00%
5.00%
10.00%
15.00%
20.00%
2007 2008 2009 2010 2011 2012 2013 2014 2015 2016
Percent Increase in Assessed Valuation
FY 2007 to FY 2016
$-
$5,000
$10,000
$15,000
$20,000
2007 2008 2009 2010 2011 2012 2013 2014 2015 2016
Value in Millions
Net Assessed Valuation - Historical Comparison
FY 2007 to FY 2016
205
City of Palm Desert
Supplemental FY 2016 and 2015 Breakdown of Basic 1% Property Tax Rate
Not In Redevelopment Project Area
Taxing Agency FY 2016 Rate FY 2015 Rate
County General 28.177327% 28.177327%
County Free Library 2.728242% 2.728242%
County Structure Fire Protection 5.873086% 5.873086%
City of Palm Desert (1) 0.000000% 0.000000%
Desert Sands Unified School District 36.221587% 36.221587%
Desert Community College 7.526714% 7.526714%
Riverside County Reg. Park & Open Space 0.426231% 0.426231%
Riverside County Office of Education 4.094919% 4.094919%
Desert Hospital 1.996808% 1.996808%
Coachella Valley Public Cemetary 0.339927% 0.339927%
Coachella Valley Recreation & Park 2.071624% 2.071624%
Coachella Valley Mosquito & Vector Control 1.369698% 1.369698%
Coachella Valley County Water 2.736607% 2.736607%
Coachella Valley County Water Imp. District 80 2.972906% 2.972906%
Coachella Valley County Water Storm Water Unit 3.464324% 3.464324%
General Purpose Basic 1% 100.000000% 100.000000%
(1) City of Palm Desert is a No-Low Property Tax City and the 7% represents what the state allocates to No-Low Property
Tax Cities.
Source: County of Riverside, Property Tax Allocation Percentages, TRA 018-041.
206
City of Palm Desert
Property Tax Rates
Direct and Overlapping Property Tax Rates
Last Ten Fiscal Years
Fiscal
Year
Basic
County-wide
Levy
Total
Direct Tax
Rate
Desert Sands
Unified School
District
Desert
Community
College Dist.
Coachella
Valley Water
District
Coachella
Valley Water
District I.D. 58
2016 1.00000 1.00000 0.08599 0.02036 0.10000 0.00000
2015 1.00000 1.00000 0.10984 0.02325 0.10000 0.00000
2014 1.00000 1.00000 0.10954 0.01995 0.10000 0.00000
2013 1.00000 1.00000 0.11156 0.01995 0.08000 0.00000
2012 1.00000 1.00000 0.11467 0.01995 0.08000 0.00000
2011 1.00000 1.00000 0.10036 0.01995 0.08000 0.00000
2010 1.00000 1.00000 0.08112 0.01995 0.06000 0.00000
2009 1.00000 1.00000 0.07990 0.01995 0.04000 0.00000
2008 1.00000 1.00000 0.07561 0.01995 0.04000 0.00230
2007 1.00000 1.00000 0.07613 0.01995 0.02080 0.01560
Notes:Proposition 13 limits the ability of the city to raise the property tax rate.
Source: CalMuni Statistics Inc
City Direct Overlapping Rates
207
City of Palm Desert
Principal Property Taxpayers
Current Year and Ten Years Ago
2016 2007
Taxpayer Taxable
Assessed Value
Percentage of Total
City Tax Assessed
Value
Taxpayer Taxable
Assessed Value
Percentage of Total
City Tax Assessed
Value
WEA Palm Desert 147,691,936$ 1.07% Marriott Desert Springs $214,170,129 1.80%
Marriott Desert Springs 144,345,789 1.05% WEA Palm Desert 117,028,673 0.98%
WVC Rancho Mirage 103,564,856 0.75% Elisabeth E. Stewart 87,435,938 0.73%
Gardens on El Paseo LLC 103,104,377 0.75% Desert Crossing II 83,199,845 0.70%
Pru Desert Crossing II
LLC 88,086,771 0.64% Gardens SPE II 74,205,979 0.62%
Monarch Sevilla Venture 68,545,957 0.50%Marriott Ownership
Resorts-Timeshares 51,595,356 0.43%
Walmart Real Estate
Business Trust 59,504,429 0.43% J H Palm Desert 41,726,931 0.35%
Marrakesh Comm Assoc 54,218,195 0.39% Big Horn Development 35,681,330 0.30%
Segovia Operations 48,872,670 0.35% NGP Realty Sub 32,779,637 0.28%
Sunrise Spectrum 47,990,406 0.35% PR XIV 31,584,699 0.27%
Total 865,925,386$ 6.28%Total 769,408,517$ 6.46%
Note:The estimated property tax revenue stated above is based upon net taxable values, tax ratios and base year values that impact the revenue
calculation. As a result, parcels with the same assessed value that are assigned to different tax rate areas may contribute dissimilar amounts
of total revenue to the City and Redevelopment Agency.
Source: HdL Coren & Cone thru Riverside County Assessor 15/16 and HdL Coren & Cone thru Riverside County Assessor 06/07
208
City of Palm Desert
Property Tax Levies and Collections
Last Ten Fiscal Years
Fiscal
Year Taxes Levied Collections
Ended for the Percentage in Subsequent Percentage
June 30, Fiscal Year Amount of Levy Years
(4)Amount (4)(5)of Levy
2007 4,820,583 4,575,158 94.91% 245,425 4,820,583$ 100.00%
2008 5,206,384 4,734,970 90.95% 471,414 5,206,384$ 100.00%
2009 5,697,181 4,760,806 83.56% 135,057 4,895,863$ 85.93%
2010 5,372,247 4,686,541 87.24% 282,866 4,969,407$ 92.50%
2011 5,312,856 4,560,417 87.24% 486,495 4,776,795$ 89.91%
2012 5,478,345 4,366,451 79.70% 1,111,894 5,478,345$ 100.00%
2013 5,398,524 4,913,780 91.02% 484,744 5,398,524$ 100.00%
2014 5,623,740 5,048,787 89.78% 574,953 5,623,740$ 100.00%
2015 5,911,501 5,523,658 93.44% 387,843 5,911,501$ 100.00%
2016 6,212,993 5,943,252 95.66% 269,741 6,212,993$ 100.00%
(1) City of Palm Desert is on the "Teeter Plan" with the County of Riverside. The first payment was
received in the fiscal year 1993/94.
(2) City of Palm Desert is a "No-Low Property Tax City". Proposition 13 rolled the tax rates back to 1973
which is when the City of Palm Desert incorporated and the Property Tax rates were zero.
Based on current state law the County allocates 7% of the 1% assessed values within the City less the
Redevelopment Agency tax increment. Fiscal Year 1992/93 was the first year to receive the No/Low taxes.
(3) Fiscal Year 1996/97 final total collected includes adjustments for No-Low property
tax collections from prior years modified by the County of Riverside. The County adjusted the payment to
the City of Palm Desert (FY 1995/96) for the annexation of Palm Desert Country Club.
(4) Includes tax collections accrued as of June 30, 2016.
(5) Includes amounts receivable for tax year 2015-2016 along with prior receivables due for prior tax years.
Source: Riverside County Auditor Controller Office and City of Palm Desert
Collected within the
Fiscal Year of the Levy (1) (2) (3)
Total Collections to Date
209
City of Palm Desert
Supplemental Top 25 Sales Tax Generators
Graph - Historical Sales Tax Trends
June 30, 2016
Top 25 Sales Tax Generators (1) Primary Economic Category
ALBERTSON'S FOOD CENTERS SUPERMARKETS
APPLE STORES SPECIALTY STORES
ARCO AM/PM MINI MARTS SERVICE STATIONS
BEST BUY STORES LP APPLIANCE / ELECTRONICS
CIRCLE K FOOD STORES SERVICE STATIONS
CONSOLIDATED ELECTRICAL DISTRIBUTORS SPECIALTY WHOLESALE STORES
COSTCO WHOLESALE COMPANY GENERAL STORES
GUTHY RENKER NON-STORE RETAIL
J.C.PENNY COMPANY INC DEPARTMENT STORES
JW MARRIOTT DESERT SPRINGS HOTEL / FOOD & BEVERAGE
KOHLS DEPARTMENT STORES DEPARTMENT STORES
LOWE'S HOME CENTERS BLDG.MATLS-WHSLE
MACY'S DEPARTMENT STORES DEPARTMENT STORES
MARSHALL'S STORES APPAREL STORES
NORDSTROM RACK DEPARTMENT STORES
RALPHS GROCERY SUPERMARKETS
SAKS FIFTH AVENUE SPORTING GOODS
SAM'S CLUB DEPARTMENT STORES
SIMPLOT PARTNERS DEPARTMENT STORES
STONELEDGE FURNITURE HOME FURNISHINGS
SUPERIOR POOL PRODUCTS SPECIALTY WHOLESALE STORES
TARGET STORES DEPARTMENT STORES
TOMMY BAHAMA APPAREL STORES/RESTAURANT
TOTAL WINE & MORE SUPERMARKETS
WAL-MART SUPERCENTER DEPARTMENT STORES
(1) Listed in Alphabetical Order
Note : Current California law prohibits production of individual tax information as an effort not to infringe on proprietary
information, therefore confidential information which is protected by law is not disclosed.
* The State of California exchanged Sales Tax Revenue with Property taxes, this amount represents the portion of sales tax that were exchanged.
Source: SBOE Data, MuniServices LLC. In Lieu given to city from State ERAF Property Taxes, City of Palm Desert
$7.0
$9.0
$11.0
$13.0
$15.0
$17.0
$19.0
$21.0
2007200820092010201120122013201420152016Millions
Sales and Use Tax Trends FY 2007 - 2016
0.8%-4.0%
-15.8%
-8.3%
7.9%5.9%
Amounts
% = % Change from Prior Year
1.8%
8.1%
17.918 17.195 14.474 13.273 14.680 15.836 16.764 17.258 17.56 4 18.994
10.6%
-In Lieu *
2.9%
210
City of Palm Desert
Supplemental Taxable Sales by Category
Last Ten Calendar Years
Sector 2015 2014 2013 2012 2011 2010 2009 2008 2007 2006
Apparel Stores 2,054,232$ 2,080,342$ 1,956,390$ 1,884,720$ 1,738,840$ 1,682,350$ 1,341,860$ 1,424,880$ 1,592,070$ 1,558,590$
General Merchandise 3,678,239 3,786,704 3,809,305 3,783,700 3,667,800 3,210,230 3,043,960 3,266,730 3,885,830 3,927,380
Food Markets 757,334 799,835 807,438 767,770 507,340 468,900 405,730 448,800 493,980 538,700
Restaurants 2,820,500 2,725,634 2,561,784 2,377,780 2,276,530 1,520,430 1,374,750 1,459,070 1,817,310 1,849,540
Furniture/Appliance 1,099,638 1,048,971 988,716 996,960 973,270 971,710 974,150 1,061,660 1,357,750 1,619,970
Bldg.Matls-Wholesale 1,200,141 1,128,350 1,113,345 984,810 882,170 730,230 582,410 865,640 956,330 697,730
Automotive 256,144 221,758 201,898 198,570 182,640 150,940 113,140 103,010 85,960 61,210
Service Stations 508,861 597,432 624,849 638,490 866,370 607,640 664,160 649,120 639,690 594,010
Other Retail 1,879,937 1,869,242 1,769,914 1,586,330 1,489,210 1,414,080 1,857,220 2,180,050 2,829,730 2,958,300
Non-Retail (1)1,859,439 1,681,430 1,498,793 1,455,190 1,262,170 1,822,270 1,856,550 1,822,230 2,194,110 2,221,770
Totals 16,114,465$ 15,939,698$ 15,332,432$ 14,674,320$ 13,846,340$ 12,578,780$ 12,213,930$ 13,281,190$ 15,852,760$ 16,027,200$
City direct sales tax rate 1.00% 1.00% 1.00% 1.00% 1.00% 1.00% 1.00% 1.00% 1.00% 1.00%
(1) Non-retail are a mix of manufacturers, distributors, builders and professionals selling direct to consumers.
Note: The combined sales tax rate for the City of Palm Desert is 8.00%, which represents the State of California mandated tax rate
of 7.5% and 0.5% additional sales tax imposed by the County of Riverside.
The City of Palm Desert receives 1% of all sales tax generated within the city limits.
Source: Muniservices LLC via California State Board of Equalization
211
City of Palm Desert
Supplemental Principal Sales Tax Remitters
Current and Ten Calendar Years Ago
Tax Amount Percentage Tax Amount Percentage
General Merchandise 3,678,239 22.83% 3,927,380$ 24.50%
Other Retail 1,879,937 11.67% 2,958,300$ 18.46%
Non-Retail (1) 1,859,439 11.54% 2,221,770$ 13.86%
Restaurants 2,820,500 17.50% 1,849,540$ 11.54%
Apparel Stores 2,054,232 12.75% 1,558,590$ 9.72%
Furniture/Appliance 1,099,638 6.82% 1,619,970$ 10.11%
Service Stations 508,861 3.16% 594,010$ 3.71%
Bldg.Matls-Wholesale 1,200,141 7.45% 697,730$ 4.35%
Food Markets 757,334 4.70% 538,700$ 3.36%
Automotive 256,144 1.59% 61,210$ 0.38%
Totals 16,114,465$ 16,027,200$
(1) Non-retail are a mix of manufacturers, distributors, builders and professionals selling direct to consumers.
Note: Current California law prohibits production of individual tax information as an effort not to infringe on proprietary
information, therefore confidential information which is protected by law is not disclosed.
Source: Muniservices LLC via California State Board of Equalization
2015 2006Industry
212
City of Palm Desert
Ratios of Outstanding Debt by Type
Last Ten Fiscal Years
Business
Type
Activities
Special Assessment/ Total
Fiscal Local Obligation Note Capital Primary
Year Bonds Payable Leases Government
2007 2,783,000 c 613,535 2,181,546 5,578,081
2008 2,748,000 490,828 1,582,782 4,821,610
2009 4,717,000 d 368,121 955,141 6,040,262
2010 10,095,000 e,f 245,414 328,273 10,668,687
2011 9,543,000 122,707 1,035,721 10,701,428
2012 9,238,000 - 2,291,358 11,529,358
2013 8,920,000 - 1,751,083 10,671,083
2014 8,246,000 - 1,222,915 9,468,915
2015 3,302,000 f - 1,435,046 4,737,046
2016 3,045,000 - 929,860 3,974,860
Special Percentage
Fiscal Redevelopment Assessment of Personal Per
Year Bonds Bonds
Income b,g Capita b,g
2007 421,819,894 119,610,000 a 25.65% 12,761 a
2008 412,694,700 112,615,000 21.73% 11,063
2009 401,601,475 109,880,000 20.90% 10,766
2010 388,972,156 107,070,000 20.16% 10,498
2011 368,261,367 104,170,000 18.94% 9,302
2012 354,527,796 101,155,000 18.05% 8,927
2013 339,786,269 98,035,000 17.07% 8,524
2014 317,717,317 86,385,000 15.50% 7,817
2015 301,004,341 83,170,000 14.36% 7,334
2016 284,580,062 59,070,000 h 12.84% 7,046
a - The city issued $50.51 million of special assessment bonds in fiscal year end 2007 allocated to three separate assessment districts. In addition the City's
Redevelopment Agency issued $284.37 in bonds of which $183.15 was new debt.
b - Personal income, population and per capita information provided by California Department of Finance,
and U.S Census Bureau and/or estimated by City Finance using 1.5% growth rate.
c - Special Assessment Government Activities includes Highlands Undergrounding AD No# 04-01. As of June 30, 2016 the outstanding balance was $1.451M.
d - Fiscal Year End 2009 the City issued the Energy Independence Program Limited Obligation Improvement Bonds Series 2009A (Taxable) $2.5 million to fund the
Energy Independence Loan Program. The actual Bond Issuance was for $2.015M. At June 30, 2016 the outstanding balance was $0.934M.
e - The City issued $1.136 million dollars of the Energy Independence Program (AB811 Assessments) Limited Obligation Improvement Bonds (Taxable)
The special assessment collection will commence during the fiscal year 2010-2011. At June 30, 2016 the outstanding balance was $0.660M.
f - In addition the Palm Desert Financing Authority issued $5.225 million dollars of the Energy Independence Program Variable Rate Demand Lease
Revenue Bonds, Series 2009(Federally Taxable). On September 2, 2014 the bonds were called in full.
g - Personal income and Per Capita statistic includes government, business, and fiduciary activities combined.
h - During the fiscal year 2015-16 the Communities Facilities District 2005-1 (University Park Series, Special tax Bonds Series 2006A and Series 2007
called $20.885M of the original issued $67.715M. At June 30, 2016 the outstanding balance was $31.130M.
Notes: Details regarding the city's outstanding debt can be found in the notes to the financial statements.
Primary Government
Fiduciary Activities
Governmental Activities
213
City of Palm Desert
Ratios of General Bonded Debt Outstanding
Last Ten Fiscal Years
General Bonded Debt Outstanding
Successor Agency Percentage of Actual
Fiscal Redevelopment Special Assessment Taxable Value of Per
Year Bonds Bonds Property Capita
Note: There is no General Obligation Bonds from FY 2007 to FY 2016
214
City of Palm Desert
Supplemental Special Assesment Information
June 30, 2016
District Name\Description 2003 01-01 Revenue
Bonds 94-3 Merano 5
2003 01-01
Revenue Bonds
Silver Spur Ranch
Utility
Undergrounding 5
2004 R-Bonds
98-1
Canyons @ Bighorn
Community Facilities District
No. 2005-1 (University Park)
Special Tax Bonds Series 2006A
2004-2 Section 29
Assessment District
Limited Obligation
Improvement Bonds
Bond Issue Date 06/25/03 06/25/03 02/19/04 05/09/06 3/29/2007
Final Maturity Date 09/02/20 09/02/28 09/02/18 09/01/37 9/2/2037
Highest Interest Rate 5.25% 5.375% 5.100% 5.424% 5.100%
Bond Issue Amount 1,153,000$ 2,340,000$ 2,955,000$ 67,915,000$ 29,430,000$
Matured Principal 713,000$ 745,000$ 1,425,000$ 9,770,000$ 3,940,000$
Called Principal 5,000$ 160,000$ 1,335,000$ 27,015,000$ 2,305,000$
Outstanding Bonds (4)435,000$ 1,435,000$ 195,000$ 31,130,000$ 23,185,000$
Redemption Premium 3.00% 3.00% 3.00% 3.00% 3.00%
Original Parcels 121 201 97 78 748
Active Parcels 118 193 3 67 666
Reserve Requirement 69,000$ 160,000$ 19,500$ 2,671,716$ 1,757,210$
Reserve Balance 15/16 159,968$ 208,828$ 73,570$ 2,513,426$ 1,778,478$
Principal Due 16/17 (2)85,000$ 85,000$ 65,000$ 1,410,000$ 640,000$
Principal Levied 15/16 (3)83,270$ 84,555$ 58,938$ 890,000$ 699,420$
Interest Due 16/17 (2)16,163$ 69,514$ 5,195$ 1,579,125$ 1,117,210$
Interest Levied 15/16 (3)18,212$ 73,049$ 6,099$ 1,601,375$ 1,240,707$
15/16 Delinquency Rate 1.15% 2.02% 0.00% 0.00% 1.80%
Arbitrage Installment Computation Date:
90% Rebate Due 06/25/18 06/25/18 09/02/18 05/08/21 04/11/17
Arbitrage Yield Rate 4.913% 4.9129% 4.4994% 5.3599% 5.0134%
Arbitrage-Amount Owed - - - - -
Continuing Disclosure Last Report
Issued:12/15/2015 12/15/2015 12/15/2015 12/15/2015 12/15/2015
District Name\Description
Series 2008
Community Facilities
District No. 91-1 Special
Tax Refunding Bonds
Bond Issue Date 12/19/2007
Final Maturity Date 10/1/2020
Highest Interest Rate 4.000%
Bond Issue Amount 10,935,000$
Matured Principal 8,235,000$
Called Principal -$
Outstanding Bonds (4)2,700,000$
Redemption Premium 3.00%
Original Parcels (Parcels in District)1,153
Active Parcels 1,060
Reserve Requirement 713,829$
Reserve Balance 15/16 (1)849,260$
Principal Due 16/17 (2)1,105,000$
Principal Levied 15/16 (3)1,105,000$
Interest Due 16/17 (2)41,719$
Interest Levied 15/16 (3)62,438$
15/16 Delinquency Rate 0.49%
Arbitrage Installment Computation Date:
90% Rebate Due 01/15/18
Arbitrage Yield Rate 3.8681%
Arbitrage-Amount Owed -
Continuing Disclosure Last Report
Issued:12/15/2015
(1) Reserve Balances on June 30, 2016.
(2) Amount represents principal and interest collected suring the FY 15/16 tax roll for Debt Service Payment due in FY 16/17.
(3) Levied amounts reflect adjustments for construction funds, reserve funds, redemption funds and other adjustments.
(4) Outstanding bond balance on June 30, 2016.
(5) The schedule presents the information for each individual local obligation bonded district. Assessment Districts
94-3 Merano and 01-01 Silver Spur were refunded and obligated to pay Debt Service to Series 2003 Assessment Revenue Bonds
see note 13 for additional information.
Source: Wildan Financial Annual Report
215
City of Palm Desert
Direct and Overlapping Government Activities Debt
June 30, 2016
2015/16 Assessed Valuation: 13,732,100,799$
City's Share of
DIRECT AND OVERLAPPING TAX ASSESSEMENT DEBT Total Debt 6/30/16 % Applicable (1) Debt 6/30/16
Desert Community College District 283,391,384$ 19.204% 54,422,481$
Desert Sands Unified School District 329,215,000 34.364% 113,131,443
Palm Springs Unified School District 340,580,707 4.699% 16,003,887
City of Palm Desert 1915 Act Bonds 26,691,000 100.000% 26,691,000
City of Palm Desert Community Facilities District No. 91-1 2,700,000 100.000% 2,700,000
City of Palm Desert Community Facilities District No. 2005-1 31,130,000 100.000% 31,130,000
TOTAL DIRECT AND OVERLAPPING TAX AND ASSESSMENT DEBT 244,078,811$
OVERLAPPING GENERAL FUND OBLIGATION DEBT
Riverside County General Fund Obligations 889,831,745$ 5.764% 51,289,902$
Riverside County Pensions Obligations 304,520,000 5.764% 17,552,533
Riverside County Board of Education Certificate of Participation 935,000 5.764% 53,893
Desert Sands Unified School District Certificates of Participation 55,780,000 34.664% 19,168,239
City of Palm Desert General Fund Obligations 3,045,000 100.000% 3,045,000 (3)
Coachella Valley Recreation and Park District Certificates of Participation 1,368,228 27.084% 370,571
TOTAL GROSS OVERLAPPING GENERAL FUND OBLIGATION DEBT 91,480,138$
Less: Riverside County Supported Obligations 359,497
TOTAL NET OVERLAPPING GENERAL FUND OBLIGATION DEBT 91,120,641$
OVERLAPPING TAX INCREMENT DEBT:(SUCCESSOR AGENCIES)565,398,742$ 0.278-100%273,230,973$
TOTAL CITY DIRECT DEBT -$
TOTAL GROSS OVERLAPPING DEBT 605,744,922$
TOTAL NET OVERLAPPING DEBT 605,385,425$
GROSS COMBINED TOTAL DEBT 605,744,922$ (2)
NET COMBINED TOTAL DEBT 605,385,425$
(1) The percentage of overlapping debt applicable to the city is estimated using taxable assessed property value.
Applicable percentages were estimated by determining the portion of the overlapping district's assessed value that is within the boundaries of the city divided
by the district's total taxable assessed value.
(2) Excludes tax revenue anticipation notes, enterprise revenue, mortgage revenue and tax allocation bonds and non-bonded
capital lease obligations that are not related to the City of Palm Desert.
(3) Includes special assessment debt with government commitment, limited obligation improvement bonds, and lease revenue bonds; if applicable.
Ratios to 2015-16 Adjusted Assessed Valuation:
Total Overlapping Tax and Assessment Debt 1.78%
Total Direct Debt 0.00%
Gross Combined Total Debt 4.41%
Net Combined Total Debt 4.41%
Ratios to Successor Agencies Redevelopment Incremental Valuation (8,801,169,619)$
Total Overlapping Tax Increment Debt 3.10%
Source: California Municipal Statistics, Inc., City of Palm Desert Finance Department
216
City of Palm Desert
Legal Debt Margin Information
Last Ten Fiscal Years
Assessed Value 13,732,100,799$
Debt Limit (15% of Assessed Value) (1) 2,059,815,120
Debt Applicable to Limit:
General Obligation Bonds 1,451,000
Less: Amount set aside for
repayment of general obligation
debt -
Total Debt Applicable to Limit -
Legal debt margin 2,058,364,120$
2007 2008 2009 2010 2011 2012 2013 2014 2015 2016
Debt Limit 1,783,572,979 1,971,408,152 2,076,172,690 1,999,731,410 1,969,825,360 1,884,624,932 1,811,620,824 1,869,699,132 1,963,741,235 2,059,815,120
Total Net debt applicable to limit 2,783,000 2,748,000 2,702,000 1,719,000 1,658,000 1,624,000 1,589,000 1,526,000 1,489,000 1,451,000
Legal debt margin 1,780,789,979 1,968,660,152 2,073,470,690 1,998,012,410 1,968,167,360 1,883,000,932 1,810,031,824 1,868,173,132 1,962,252,235 2,058,364,120
Total net debt applicable to the limit
as a percentage of debt limit 0.16% 0.14% 0.13% 0.09% 0.08% 0.09% 0.09% 0.08% 0.08% 0.07%
(1) Section 43605 of the California Government Code.
Source: California Municipal Statistic, Inc. San Francisco
Legal Debt Margin Calculation for Fiscal Year 2016
FISCAL YEAR
217
City of Palm Desert
Pledged-Revenue Coverage
Last Ten Fiscal Years
Fiscal
Year Collections Principal Interest Coverage Collections Principal Interest Coverage
2007 a 4,444,967 1,972,000 3,464,355 0.8176 28,675,094 7,704,000 16,434,841 1.188
2008 6,245,888 1,635,000 c 5,414,793 0.8860 41,978,187 10,610,000 21,402,246 1.311
2009 d 8,486,467 2,816,000 5,666,827 1.0004 33,095,785 12,610,000 20,043,623 1.013
2010 e 6,304,563 3,793,000 5,515,677 0.6773 33,292,785 14,145,000 19,516,455 0.989
2011 9,695,868 3,452,000 5,595,543 1.0717 39,400,572 22,240,000 18,767,205 0.961
2012 8,822,163 3,332,000 4,897,651 1.0720 32,941,958 g 15,290,000 17,651,958 1.000
2013 9,524,786 3,786,896 5,255,558 1.0533 33,473,418 g 16,315,000 17,158,418 1.000
2014 f 14,895,214 12,324,000 f 4,954,432 0.8621 38,444,447 g 23,650,000 14,794,447 1.000
2015 13,003,129 h,I 8,159,000 h 4,543,692 1.0237 32,294,255 g 18,295,000 13,999,255 1.000
2016 8,537,227 h,I 25,401,000 h,j 4,463,786 0.2859 34,810,024 g 18,055,000 16,755,024 1.000
a - The city issued $50.51 million of special assessment bonds in fiscal year end 2007, and an additional $17.915 in fiscal year end 2008 from the same district.
The RDA issued $284.37 million of debt of which $183.15 was new debt.
b - Tax increment bonds are backed by property tax increment based on calculation provided by the Riverside County tax assessor office.
Additional information on tax increment can be found in the notes to the financial statements.
c - The 1997 91-1 Bonds was refunded in full on April 1, 2008, with Communities Facilities District no. 91-1 Improvement Special Tax Refunding Bonds
Additional principal on note 13 reflects the total principal paid along with the refunded portion.
d - The City issued $2.015 million dollars of the Energy Independence Program (AB811 Assessments) Limited Obligation Improvement Bonds (Taxable)
The special assessment collection will commence during the fiscal year 2009-2010 with the first interest payment paid on March 2, 2010.
e - The City issued $1.136 million dollars of the Energy Independence Program (AB811 Assessments) Limited Obligation Improvement Bonds (Taxable)
The special assessment collection will commence during the fiscal year 2010-2011
In addition the Palm Desert Financing Authority issued $5.225 million dollars of the Energy Independence Program Variable Rate Demand Lease
Revenue Bonds, Series 2009(Federally Taxable). Interest is paid monthly commencing August 2009 and Principal is paid annually on September 2
The first principal payment was paid on September 2, 2010.
f - A portion of the $50.51 (2007) and $17.915 (2008) million CFD 2005-1 (University Park) was prepaid in the amount of $6.269 Million. The prepaid
$6.269M and $2.280 (2004-1) were called during on September 2, 2014.
g- The total amount payable for the bonded obligations is disbursed by the State of California Department of Finance to the City of Palm Desert Successor Agency.
The annual collection equal the annual obligations.
h- The City called the $5.225 Million Energy Independence Program Variable Rate Demand Lease Revenue Bonds, Series 2009 (Federally Taxable) in
full on September 2, 2014 in the amount of $4.485 Million. The Energy Fund used the remaining $5.225 Bond Funds in the amount of $2.155 Million
in addition to the $2.5 Million loan from the City General Fund as proceeds to call the bonds. The $2.155 million is included as collections.
i- The City of Palm Desert loaned the Energy Fund $2.5 Million to call the $5.225 Million Energy Independence Program Lease Revenue Bonds,
Series 2009 (Federally Taxable). The $2.5 Million is included as Special Assessment Collection.
j - During the Fiscal Year 2015-16 the Communities Facilities District 2005-1 (University Park Series, Special Tax Bonds Series 2006A and Series 2007
defeased $20.885M of the original issued $67.715M. Unspent project proceeds were used to call the bonds.
Notes: Details regarding the outstanding debt can be found in the notes to the financial statements.
Special Assessment Bonds Tax Increment b
Debt Service Debt Service
218
Last Ten Calendar Years
Calendar Percentage Per Capita City Riverside Percentage County
Year City Increase Personal Personal Unemployment County Increase Unemployment
End Population (Decrease)Income CY a Income CY Rate b Population (Decrease)Rate b
2016 49,335 -3.4% 2,747,988,894$ 55,701$ 4.20% 2,347,828 1.71% 6.70%
2015 51,053 1.3% 2,707,378,221$ 53,031$ 4.60% 2,308,441 1.25% 6.50%
2014 50,417 0.9% 2,667,367,705$ 52,906$ 4.90% 2,279,967 1.10% 8.40%
2013 49,949 1.0% 2,627,948,478$ 52,613$ 6.00% 2,255,059 1.23% 10.20%
2012 49,471 0.7% 2,589,111,801$ 52,336$ 7.74% 2,227,577 0.44% 11.99%
2011 49,111 -5.7% 2,550,849,065$ 51,940$ 8.67% 2,217,778 3.66% 14.44%
2010 52,067 1.1% 2,513,151,788$ 48,268$ 8.8% 2,139,535 1.51% 14.65%
2009 51,509 1.2% 2,476,011,613$ 48,069$ 6.8% 2,107,653 0.93% 11.46%
2008 50,907 2.3% 2,439,420,309$ 47,919$ 4.1% 2,088,322 6.91% 8.6%
2007 49,752 0.4% 2,132,710,348$ 42,867$ 3.6% 2,031,625 4.01% 6.0%
a - Personal Income estimated based on average growth rate of previous four years. The growth rate factor used was 1.5%. Income data will be
updated once the actual data is available.
b - Unemployment rate for fiscal year 15/16 is based on annual information from State of California Employment Development Department
Labor Market Information Division (not seasonally adjusted)
Sources: State Department of Finance, U.S. Dept of Labor, State Employment Development Department
City of Palm Desert
Demographic & Economic Statistics
219
City of Palm Desert
Principal Employers
Current and Ten Years Ago
Employer Employees Rank
Percentage of
Total City
Employment
Employer Employees Rank
Percentage of
Total City
Employment
JW Marriot-Desert Springs
Resort & DS Villas 2,304 1 10.33%
JW Marriot-Desert Springs
Resort 1300 1 4.09%
Universal Protection Services 1,500 2 6.73%
Securitas-Security Service USA 700 2 2.20%
Securitas-Security Service
USA 700 3 3.14%
College of the Desert 630 3 1.98%
Sunshine Landscape 500 4 2.24%
Marriott Desert Springs Villas 500 4 1.57%
Riverside County Sheriff 368 5 1.65%
Sunshine Landscaping 500 5 1.57%
Bighorn Golf Club 250 6 1.12%
Desert Valley Industries 400 6 1.26%
Costco 250 7 1.12%
Marriott Ownership Resorts 300 7 0.94%
Desert Arc 250 8 1.12%
Sunrise Colony Co.250 8 0.79%
Westin Desert Willow 248 9 1.11%
Desert ARC 236 9 0.74%
Timer Warner Cable 236 10 1.06%
Time Warner Cable 220 10 0.69%
Totals 6,606 30% Totals 5,036 16%
Sources: InfoUSA.com, CA Employment Development Department - Federal and State Government not included
2016 2007
220
City of Palm Desert
Supplemental Miscellaneous Statistics
1-Jun June 30, 2016
City/ Municipal Government
Form of Government: Council - City Manager/Charter City
Date of Incorporation: November 26, 1973
Number of Employees: 113 Full-time Employees
Size of City: 25.5 Square Miles
Geographic Location: Located 117 miles east of Los Angeles and 515 miles
south of San Francisco.
Streets: 170 paved street miles
Number of Business Licenses: 10,470 active business licenses
Number of Hotels & Rooms: 15 hotels, 2,298 rooms
CONTRACT SERVICES:
Police Department Contract with Riverside County Sheriff - 74 positions plus 31 support staff
Fire Department Contract with Riverside County/State Fire 50 positions plus 7 Fire Prevention staff
Animal Control Riverside County Animal Services
Water & Sewer Coachella Valley Water District
Trash Collection Burrtec - Waste Management
Electric Southern California Edison
Gas Southern California Gas
Telephone Verizon
Airport Palm Springs International Airport
Public Education
Elementary School (grades K - 5) 4
Middle School (grades 6 - 8) 1
High School (grades 9 - 12) 1
Community College - College of the Desert 1
CSUSB - Palm Desert Campus 1
UCR - Palm Desert Graduate Center 1
Insurance Coverage
General Liability Coverage Calif. Joint Powers Insurance Authority $50 Million/Event
(Excludes Earthquake & Flood)Excess Coverage: from $2 Million up to $50 Million limit
Special Events Calif. Joint Powers Insurance Authority $1 Million
Worker's Compensation Calif. Joint Powers Insurance $10 Million
Property Insurance Calif. Joint Powers Insurance Based on Prop. Value
Health Insurance
Medical California PERS; choice of PPO, HMO, Kaiser, Blue Shield
Dental Delta Dental
Vision Vision Service Plan
Disability Insurance Disability - Standard Insurance Company
Life Standard Insurance Company
Retirement California PERS - Public Employees' Retirement System
Source: City of Palm Desert
221
City of Palm Desert
Full-time Equivalent City Government Employees by Function / Program
Last Ten Fiscal Years
Function / Program 2016 2015 2014 2013*
2012* #2011* 2010 2009 2008 2007
General Government
City 32 34 34 33 26 31 31 49 49 51
Economic Dev & Housing # 13 13 13 12 17 24 25 19 19 19
Public Safety 28 26 25 24 24 25 26 35 35 35
Police & Fire (1) 163 169 173 157 162 155 151 148 146 143
Public Works 40 40 40 38 40 47 49 53 52 44
Totals 276 282 285 264 271 284 284 318 315 310
(1) The City operates as a "contract city" utilizing, primarily, agreement with other governmental entities, private firms and individuals
to provide services.
Contracted services include: Police and Fire protection through the County of Riverside, Cal-Fire, animal control, health services,
legal services and landscape maintenance.
* As of June 2011 realignments were made due to budget cuts, retirements and layoffs, these continued to FY 2013.
# On February 1, 2012 the State of California dissolved the City of Palm Desert Redevelopment Agency as part of the Statewide dissolution of all
City Redevelopment Agencies, which in turn created the Successor Agency to the Redevelopment Agency of the City of Palm Desert.
Source: City of Palm Desert Financial Plan, California Department of Forestry and Fire Protection, Riverside County Sheriff's Department
222
City of Palm Desert
Operating Indicators by Function / Program
Last Ten Fiscal Years
Function / Program 2016 2015 2014 2013 2012 2011 2010 2009 2008 2007
General Government
Business License Inspections *24 33 196 477 515 473 617 489 447
Contracted Services - Burrtec Waste (1)
Refuse Collected (tons)52,772 54,865 57,935 52,131 49,205 53,108 51,483 58,198 67,940 73,467
Recyclables Collected 23,818 24,611 26,424 24,862 23,588 22,867 20,591 22,155 23,798 24,089
Public Safety
Physical Arrests 1,284 1,946 1,348 986 1,012 1,134 1,342 1,446 1,550 1,430
Parking Violations 712 794 386 198 569 332 933 1,278 770 694
Traffic Violations 6,223 5,525 5,284 5,080 6,216 8,360 10,200 9,162 5,929 6,875
Emergency Responses-Fire Department 9,285 8,628 8,235 7,907 7,151 7,720 7,772 7,149 6,908 6,785
Fires Extinguished 103 88 106 104 101 107 104 119 154 241
Fire Inspections 2,118 2,989 2,552 3,048 5,235 4,651 4,825 8,248 4,267 5,934
Building Permits Issued 4,704 4,909 5,552 4,548 3,448 3,711 3,230 3,637 4,012 5,813
Building Inspections Conducted 24,756 24,057 24,830 19,107 14,749 14,069 14,080 18,040 26,401 33,215
Public Works
Street Resurfacing (miles) (3)2.98 342360 5 8 13179
Parks, recreation & culture
Athletic Field Permits Issued 2,997 4,430 6,548 2,635 3,682 6,050 6,281 6,149 5,949 4,510
Amphitheater / Pavilions Permits Issued 104 283 247 128 266 286 226 133 133 84
Community Center Admissions 64,493 53,426 50,204 53,062 69,240 30,298 59,986 55,954 112,540 97,339
Aquatic Center Admissions (2)60,359 64,103 43,545 48,663 45,909 4,329 - - - -
(1) The City operates as a "contract city" utilizing, primarily, agreement with other governmental entities, private firms and individuals
to provide services.
Contracted services include: Police and Fire protection through the County of Riverside, animal control, health services,
legal services and landscape maintenance.
(2) Aquatic Center operations began in June 2011, managed by the YMCA.
(3) New methods of street resurfacing have improved efficiency, therefore equaling more miles resurfaced.
(*)Per Building & Safety Department inspections no longer done.
Sources: Riverside County Sheriff's Dept., California State Department of Forestry & Fire Protection,
City of Palm Desert, Coachella Valley Recreation & Park District, Burrtec Waste and The YMCA.
223
City of Palm Desert
Capital Asset Statistics by Function / Program
Last Ten Fiscal Years
Function / Program 2016 2015 2014 2013 2012 2011 2010 2009 2008 2007
General Government
Contracted Services (1)
Collection trucks 35 30 30 36 36 51 51 54 69 61
Public Safety - Police & Fire
Police Stations 1 1 1 1 111111
Police Sub Stations 1 1 1 1 002222
Patrol Units-Cars 29 29 26 28 31 31 26 30 29 29
Patrol Units-Motorcycles 11 10 10 10 10 10 10 10 7 5
Fire Stations 3 3 3 3 333333
Fire Trucks 4 plus 1 Reserve 4 plus 1 Rsrvd 4 plus 1 Rsrvd 4 plus 2 Rsrvd 4 plus 2 Rsrvd 4 plus 2 Rsrvd 4 plus 2 Rsrvd 4 plus 2 Rsrvd 4 plus 2 Rsrvd 4 plus 2 Rsrvd
Ambulance 4 plus 3 Reserve 4 plus 3 Rsrvd 4 plus 3 Rsrvd 4 plus 1 Rsrvd 4 plus 1 Rsrvd 3 plus 1 Spprt 3 plus 1 Spprt 3 plus 1 Spprt 3 plus 1 Spprt 3 plus 1 Spprt
Fire Prevention Pick-ups 3 3 3 3 333333
Public Works
Streets (miles)170 170 170 170 174 159 159 159 159 154.11
Traffic Signals 98 98 98 98 98 97 99 99 99 87
Parks, recreation & culture
Acreage 201 201 201 201 201 201 201 212 200 200
Total Parks 13 13 13 13 13 13 13 14 13 13
Playgrounds 16 16 16 16 16 16 16 16 9 8
Baseball/softball diamonds 8 8 8888891111
Soccer/football fields 9 9 9 9 999977
Basketball Courts 11 11 11 11 11 11 11 11 9 9
Tennis Courts 10 10 10 10 10 10 10 10 10 10
Volleyball Courts 8 8 8888881010
Community Centers 2 2 2 2 222222
Skateboard Parks 2 2 2 2 222222
Aquatic Center (2)1 1 1111
Commercial Office Space
(Parkview Office Complex)
Leaseable Space (square feet)50,322 50,322 50,322 50,322 50,322 50,322 50,322 50,322 50,322 50,322
Occupancy Rate 90% 90% 86% 88% 83% 90% 97% 98% 100% 100%
Number of Tenants by Type
Government (State, local regional)9 8 9 8 10 10 10 11 11 10
Non-Profit 4 3 4 4 577576
Private 1 1 4 5 346768
Square Footage lease by tenant
Government (State, local regional)33,127 30,907 31,921 31,321 32,021 32,696 34,617 34,617 34,402 33,298
Non-Profit 3,561 6,269 3,294 4,467 5,215 5,663 4,735 4,735 6,188 5,708
Private 8,688 8,025 8,025 8,513 4,310 7,350 10,212 10,212 9,732 11,316
Vacant 4,946 5,121 7,082 6,021 8,776 4,613 758 758 0 0
Municipal Golf Course
(Desert Willow Golf Resort)
Courses - Fire Cliff and Mountain View 2 2 2 2 222222
Holes 36 36 36 36 36 36 36 36 36 36
Golf Carts 172 172 172 172 172 172 160 160 160 160
Clubhouse square footage 39,000 39,000 39,000 39,000 39,000 39,000 33,000 33,000 33,000 33,000
Rounds per Course
Fire Cliff 39,366 44,845 45,841 45,645 45,005 44,745 45,988 46,041 46,688 47,263
Mountain View 40,910 42,407 43,160 38,669 41,666 39,178 37,146 34,899 43,898 41,182
Total Annual Rounds 80,276 87,252 89,001 84,314 86,671 83,923 83,134 80,940 90,586 88,445
(1) The City operates as a "contract city" utilizing, primarily, agreement with other governmental entities, private firms and individuals
to provide services.
Contracted services include: Police and Fire protection through the County of Riverside, animal control, health services,
legal services and landscape maintenance.
(2) Aquatic Center operations began in June 2011
Sources: Riverside County Sheriff's Dept., California State Department of Forestry & Fire Protection,
City of Palm Desert, Coachella Valley Recreation & Park District, Burrtec Waste
224
Note: This section is not required by GASB No. 44, however, City believes that statistical
information is beneficial to the reader.
On February 1, 2012 the State of California dissolved the City of Palm Desert Redevelopment Agency
as part of the Statewide dissolution of all City Redevelopment Agencies, which in turn created
the Successor Agency to the Redevelopment Agency of the City of Palm Desert.
For more information on the dissolution of the RDA please see note 17 and note 18.
Supplemental Redevelopment Agency Statistical Section
City of Palm Desert, California
225
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226
Redevelopment
Agency
Project Areas
COOK STMONTEREY AVEFRED WARING DR
PORTOLA AVEHOVLEY LN E
STATE HWY 111
STATE HWY 74FRANK SINATRA DR
EL PASEO
GERALD FORD DR
WASHINGTON STELDORADO DRWARNER TRLHOVLEY LN W
OASIS CLUB DRTAMARISK ROW D
RCALIFO R N IA AVESAN PABLO AVEPARK VIEW DR
MESA VIEW DR DEEP CANYON RDMAGNESIA FALLS DR
DINAH SH OR E D R
COOK STHAYSTACK RDTOWNCENTERWAYMONTEREY AVEP O R TO L A AVEPORTOLA AVEGRAPEVINE STSHADOW M OUN TAIN DR
FAIRWAY DR
HOVLEY LN EPORTOLA AVEFRED WARING DR
COUNTRY CLUB DR
FRANK SINATRA DRPORTOLA AVECOUNTRY CLUB DR
MONTEREY AVECOOK STINTERSTATE HWY 10
INTERSTATE HWY 10
Project Area No. 1Original1975
Project Area No. 1Added Territory1982
Project Area No. 31991
Project Area No. 21987
Project Area No. 41993
0 1 20.5
Miles
Project Area No. 1 - Original (1975)
Project Area No. 1 - Added Territory (1982)
Project Area No. 2 (1987)
Project Area No. 3 (1991)
Project Area No. 4 (1993)
City Limits
City of Palm Desert
July, 2004
THIS PAGE INTENTIONALLY LEFT BLANK
228
City of Palm Desert
Project Area Statistics
June 30, 2016
Description RDA 1
Original
RDA 1
Annex RDA 2 RDA 3 RDA 4
Date Project Area was Established July 16, 1975 November 25, 1981 July 15, 1987 July 17, 1991 July 19, 1993
Most Recent Amendment Date December 9, 2004 December 9, 2004 December 9, 2004 December 9, 2004 December 9, 2004
Effectiveness of Plan
(Project Duration)July 16, 2016 November 25, 2022 July 15, 2028 July 17, 2032 July 19, 2034
Repayment of Indebtedness (2) July 16, 2026 November 25, 2032 July 15, 2038 July 17, 2042 July 19, 2044
Last Date to incur indebtedness Eliminated Eliminated Eliminated Eliminated Eliminated
Eminent Domain July 16, 1987 November 25, 1993 July 15, 1999 July 17, 2003 July 19, 2005
800,000,000$
1,702,142,245$
150,000,000$
319,151,671$
Types of Area in Project R, C, P R, C, P R, C, P, O R, I, C, P R, I, C, P
Acreage Size of Project Area 580 5,240 2,927 764 2,260
R = Residential, C= Commercial, P= Public Facilities, I= Industrial, O= Other
(1) Top figures are unadjusted limits and bottom figures are adjusted limits per Consumers Price Index set by the Bureau of Labor Statistics for RDA 2.
Source: Successor Agency to the Palm Desert Redevelopment Agency
(2) “Solely for the purposes of the payment of enforceable obligations defined by [Section 34171(d)(1)(A) to (G) and Section 34191.4(b) of the Dissolution Act],
and for no other purpose whatsoever, a successor agency is not subject to the limitations relating to time, number of tax dollars, or any other matters set forth in
[Health and Safety Code] Sections 33333.2, 33333.4, and 33333.6. Notwithstanding any other provision in this section, this subdivision shall not result in the
restoration or continuation of funding for projects whose contractual terms specified that project funding would cease once the limitations specified in any of
Section 33333.2, 33333.4, or 33333.6 were realized.”
Redevelopment Plan Limitations:
Tax Increment Limit (1,2) 758,000,000$ 500,000,000$ 360,000,000$ 600,000,000$
Bonded Debt Limits (1) none 200,000,000$ 100,000,000$ 135,000,000$
229
City of Palm Desert
Redevelopment Agency
Tax Allocation Bond Issue Information
June 30, 2016
DESCRIPTION $22,070,000
Tax Allocation Bonds
$19,000,000
Tax Allocation Bonds
$24,945,000
Tax Allocation Bonds
$62,320,000
Tax Allocation
Revenue
$32,600,000
Tax Allocation
Revenue
Bond
Years 28 27 21 24 11
Bond Issue Date 03/13/02 08/05/03 06/24/04 07/06/06 01/09/07
Final Maturity Date 04/01/30 04/01/30 04/01/25 04/01/30 04/01/18
Highest Interest Rate 5.100% 5.000% 5.000% 5.820% 5.000%
Bond Issue Amount 22,070,000$ 19,000,000$ 24,945,000$ 62,320,000$ 32,600,000$
Outstanding Bond Amount 22,070,000$ 12,660,000$ 12,770,000$ 37,780,000$ 7,250,000$
Call Premium 0 - 2.00% 0.00% 0.00% 0.00% 0.00%
Bond Insurer MBIA MBIA AMBAC MBIA MBIA
Reserve Requirement (1) 2,804,344 950,000 2,430,750 13,117,662 13,116,979
Reserve Balance (1) (1) (1) (1) (1) (1)
Called Bonds -$ -$ -$ -$ -$
Principle due 16/17 - - 1,335,000 1,000,000 3,570,000
Interest Due 16/17 1,114,665 633,000 618,500 1,914,445 362,500
Arbritage Yield Rate 5.2939% 4.8571% 4.7961% 4.7182% 3.8374%
Arbritage-Amount Owed - - - - -
Arbritage Five Year Due Date: 04/13/17 08/05/18 06/24/19 07/06/16 01/09/17
DESCRIPTION
$17,310,000
Tax Allocation Revenue
Bonds
$15,745,000
Tax Allocation Revenue
Bonds
$67,618,213
Tax Allocation Revenue
Bonds
$4,745,000
Tax Allocation Bonds
$15,059,526
Tax Allocation
Revenue
Years 20 30 30 30 35
Bond Issue Date 07/17/02 03/26/03 07/25/06 08/05/03 07/25/06
Final Maturity Date 08/01/22 08/01/33 08/01/36 04/01/33 04/01/41
Highest Interest Rate 5.000% 5.00% 6.10% 5.13% 6.10%
Bond Issue Amount 17,310,000$ 15,745,000$ 67,618,213$ 4,745,000$ 15,059,526$
Outstanding Bond Amount 7,770,000$ 15,745,000$ 54,397,962$ 3,325,000$ 15,571,730$
Call Premium 0 - 2.00% 1 - 2.00% 0.00% 2.00% 0.00%
Bond Insurer MBIA MBIA AMBAC MBIA MBIA
Reserve Requirement (1) 1,324,750 769,006 5,309,825 297,953 1,034,250
Reserve Balance (1) (1) (1) (1) (1) (1)
Called Bonds 955,000$ -$ 1,208,650$ 130,000$ 329,787$
Principle due 16/17 355,403 769,006 2,104,238 163,348 601,494
Interest Due 16/17 397,388 769,006 2,059,088 168,473 585,687
Arbritage Yield Rate 4.7043% 4.9502% 5.2580% 4.9358% 5.3626%
Arbritage-Amount Owed - - - - -
Arbritage Five Year Due Date: 07/17/17 03/26/18 07/25/16 08/05/18 07/25/16
DESCRIPTION
$11,020,000
Tax Allocation Revenue
Bonds
$15,695,000
Tax Allocation
Revenue Bonds
$19,243,089
Tax Allocation
Revenue
$12,100,000
Tax Allocation Revenue
Bonds
$86,155,000
Tax Allocation
Revenue
Years 30 30 28 30 20
Bond Issue Date 03/01/98 11/28/01 07/25/06 09/05/02 02/07/07
Final Maturity Date 10/01/28 10/01/31 10/01/34 10/01/31 10/01/27
Highest Interest Rate 5.00% 4.80% 5.56% 4.90% 5.00%
Bond Issue Amount 11,020,000$ 15,695,000$ 19,273,089$ 12,100,000$ 86,155,000$
Outstanding Bond Amount 7,070,000$ 11,775,000$ 17,785,370$ 8,455,000$ 50,155,000$
Call Premium 0 - 2.00% 0 - 2.00% 0.00% 1 - 2.00% 0.00%
Bond Insurer MBIA MBIA MBIA MBIA MBIA
Reserve Requirement (1)768,020 482,890 3,740,843 767,625 7,887,224
Reserve Balance (1)(1) (1) (1) (1) (1)
Called Bonds -$ -$ -$ -$ -$
Principle due 16/17 400,000 400,000 65,619 360,000 6,085,000
Interest Due 16/17 356,678 549,825 549,951 404,019 2,234,563
Arbritage Yield Rate 5.2271% 4.9464% 5.1111% 4.8290% 4.1830%
Arbritage-Amount Owed - - - - -
Arbritage Five Year Due Date: 10/01/17 11/28/16 07/25/16 09/05/17 02/07/17
(1) A surety bond was issued by MBIA Insurance, future reserve balance's will be zero.
Source: City of Palm Desert and Successor Agency to the Palm Desert Redevelopment Agency
PROJECT AREA #1
PROJECT AREA #2 PROJECT AREA #3
PROJECT AREA #4 HOUSING FUND
230
City of Palm Desert
FY 2015/2016
Breakdown of Basic 1% Property Tax Levy Rates
Redevelopment Project Areas
Rate
Taxing Agency PA 1 Original PA 1 Annex PA 2 PA 3 PA 4
County General 28.40077965% 28.34261378% 25.96648709% 25.2617655% 21.90874683%
County Library 2.74987517% 2.88933327% 2.97602702% 2.8156786% 2.82813998%
County Fire 5.91965592% 6.21986749% 6.40649348% 6.0613143% 6.08813682%
City of Indian Wells Annex 0.00000000% 0.00000000% 0.00000000% 0.00000000% 0.00000000%
Supervisor Road District 4 0.00000000% -0.00025740% 0.00000000% 0.00000000% 0.00000000%
City of Palm Desert 0.00000000% 2.15930591% 5.88996632% 4.61835638% 8.71151373%
Rancho Mirage Library 0.00000000% 0.01337722% 0.00000000% 0.00000000% 0.00000000%
Rancho Mirage Fire Asmt.0.00000000% 0.02879715% 0.00000000% 0.00000000% 0.00000000%
Desert Sands Unified School District 36.50880372% 37.03039911% 19.99738774% 37.38247201% 37.54789131%
Palm Springs Unified School District 0.00000000% 0.00000000% 14.20625551% 0.00000000% 0.00000000%
Desert Community College 7.58639663% 8.03890070% 8.21030867% 7.76794032% 7.80231517%
County Superintendent of Schools 4.12738889% 4.37357468% 4.46682894% 4.22615914% 4.24486160%
Riverside County Reg Park & Open
Space 0.42959392% 0.42857189% 0.39278725% 0.38212167% 0.44183713%
Coachella Valley Public Cemetary 0.34262195% 0.30591941% 0.18766780% 0.35081885% 0.35237266%
Palm Springs Public Cemetary 0.00000000%0.000262844 0.08424246% 0.00000000% 0.00000000%
Desert Hospital 2.01264097% 1.24584516% 1.77535632% 1.08274262% 0.00000000%
Coachella Valley Mosquito & Vector
Control 1.38055852% 1.46290375% 1.49409627% 1.41359368% 1.41985010%
Coachella Valley Recreation & Park 2.08805044% 1.86437554% 1.14371172% 2.13801608% 2.14747852%
Coachella Valley Water District 2.75830644% 2.92341836% 2.98515150% 2.82431137% 2.87733702%
Coachella Valley Resource Cons.0.00000000% 0.02147933% 0.03827055% 0.03053179% 0.03636756%
Coachella Valley Imp District 80 2.20353397% 0.99621798% 0.00000000% 0.06882609% 0.00197747%
Coachella Valley Water District Storm
Water Unit 3.49179382% 1.62907228% 3.77896135% 3.57535160% 3.59117409%
ERAF RDV 0.00000000% 0.00000000% 0.00000000% 0.00000000% 0.00000000%
General Purpose Basic 1% Rate 100.00000000% 100.00000000% 100.00000000% 100.00000000% 100.00000000%
Source: County of Riverside Auditor-Controller Tax Increment Summary
231
City of Palm Desert
Historical Net Assessed Taxable Values
Redevelopment Project Area # 1 - Original
Last Ten Fiscal Years
FY 2016 2015 2014 2013 2012
Secured: (1)
Land 260,669,755$ 252,708,144$ 248,856,920$ 249,394,404$ 244,450,814$
Improvements 652,350,864 629,461,646 616,377,829 627,764,488 626,574,093
Personal Property 3,548,054 3,118,529 4,011,017 3,908,602 2,933,226
Penalty 0 0 0 0 0
Less Other Exempt (3,760,408) (3,686,754) (2,880,165) (1,999,569) (1,960,491)
Less Home Owner Value (54,600) (49,000) (42,000) (42,000) (56,000)
Less B Inv. Value 0
Total Net Assessed Taxable Secured Value 912,753,665 881,552,565 866,323,601 879,025,925 871,941,642
Unsecured:
Land 99 1,386 1,386 99 99
Improvements 65,852,678 62,710,661 65,066,506 63,729,112 60,147,367
Personal Property 51,161,676 47,247,286 56,574,308 43,573,580 48,331,227
Penalty 0 0 0 0 0
Less Other Exempt (234,702) (350,545) (210,855) (223,222) (64,730)
Total Net Assessed Taxable Unsecured Value 116,779,751 109,608,788 121,431,345 107,079,569 108,413,963
Total Net Assessed Taxable Value 1,029,533,416$ 991,161,353$ 987,754,946$ 986,105,494$ 980,355,605$
FY 2011 2010 2009 2008 2007
Secured: (1)
Land 246,861,736$ 249,715,896$ 241,759,729$ 233,208,647$ 216,759,847$
Improvements 610,067,877 613,769,221 610,061,698 584,395,005 552,604,613
Personal Property 3,127,559 3,399,575 5,000,717 4,856,393 6,825,265
Penalty 0 0 0 0 0
Less Other Exempt (895,957) (898,089) (455,200) (1,570,949) (760,295)
Less Home Owner Value (61,600) (49,000) (70,000) (63,000) (70,000)
Less B Inv. Value 0 0 0 0 0
Total Net Assessed Taxable Secured Value 859,099,615 865,937,603 856,296,944 820,826,096 775,359,430
Unsecured:
Land 99 99 1,267 1,245 1,220
Improvements 57,617,429 63,627,182 69,008,584 60,185,535 56,536,963
Personal Property 48,607,315 53,892,307 60,792,341 57,684,012 57,404,440
Penalty 0 0 0 0 0
Less Other Exempt (63,954) (68,471) (66,749) (56,785) (32,652)
Total Net Assessed Taxable Unsecured Value 106,160,889 117,451,117 129,735,443 117,814,007 113,909,971
Total Net Assessed Taxable Value 965,260,504$ 983,388,720$ 986,032,387$ 938,640,103$ 889,269,401$
(1) Secured values include State assessed data.
Source: County of Riverside, County Auditor Controller, Assessed Valuations
232
City of Palm Desert
Change in Taxable Values
Redevelopment Project Area # 1 - Original
2016 versus 2015
FY 2016 2015 % Change
Secured: (1)
Land 260,669,755$ 252,708,144$ 3.2%
Improvements 652,350,864$ 629,461,646$ 3.6%
Personal Property 3,548,054$ 3,118,529$ 13.8%
Penalty 0$ 0$ 0.0%
Less Other Exempt (3,760,408)$ (3,686,754)$ 2.0%
Less Home Owner Value (54,600)$ (49,000)$ 11.4%
Total Net Assessed Taxable Secured Value 912,753,665$ 881,552,565$ 3.5%
Unsecured:
Land 99$ 1,386$ -92.9%
Improvements 65,852,678$ 62,710,661$ 5.0%
Personal Property 51,161,676$ 47,247,286$ 8.3%
Penalty 0$ 0$ 0.0%
Less Other Exempt (234,702)$ (350,545)$ -33.0%
Total Net Assessed Taxable Unsecured Value 116,779,751$ 109,608,788$ 6.5%
Total Net Assessed Taxable Value 1,029,533,416$ 991,161,353$ 3.9%
(1) Secured values include State assessed data.
Source: County of Riverside, County Auditor Controller, Assessed Valuations
233
City of Palm Desert
Historical Net Assessed Taxable Values
Redevelopment Project Area # 1 - Amended
Last Ten Fiscal Years
FY 2016 2015 2014 2013 2012
Secured: (1)
Land 1,672,935,655$ 1,604,125,337$ 1,541,217,133$ 1,498,607,642$ 1,485,119,173$
Improvements 3,490,703,142 3,325,472,649 3,162,274,409 2,993,556,770 2,972,294,294
Personal Property 5,030,372 7,076,746 2,716,205 2,686,088 2,902,053
Penalty 0 0 0 0 0
Less Other Exempt (102,687,268) (102,129,288) (103,135,553) (93,807,367) (92,647,477)
Less Home Owner Value (25,901,471) (26,242,138) (26,742,256) (27,231,015) (28,318,713)
Less B Inv. Value
Total Net Assessed Taxable Secured Value 5,040,080,430 4,808,303,306 4,576,329,938 4,373,812,118 4,339,349,330
Unsecured:
Land 96,063 171,444 0 266,702 547
Improvements 27,636,252 29,097,463 32,637,340 20,144,944 30,038,023
Personal Property 42,445,139 46,347,614 53,241,720 50,154,674 56,942,231
Penalty 0 0 0 0 0
Less Other Exempt (4,501,661) (5,274,099) (8,199,594) (8,262,749) (4,756,840)
Total Net Assessed Taxable Unsecured Value 65,675,793 70,342,422 77,679,466 62,303,571 82,223,961
Total Net Assessed Taxable Value 5,105,756,223$ 4,878,645,728$ 4,654,009,404$ 4,436,115,689$ 4,421,573,291$
2011 2010 2009 2008 2007
Secured: (1)
Land 1,520,035,284$ 1,556,322,273$ 1,646,837,956$ 1,548,363,317$ 1,404,883,142$
Improvements 3,064,294,006 3,138,650,280 3,216,329,372 3,098,549,660 2,848,708,294
Personal Property 3,304,016 2,462,676 4,295,752 4,850,231 5,159,912
Penalty 0 0 0 0 0
Less Other Exempt (89,778,462) (86,825,212) (86,439,305) (84,042,297) (71,117,424)
Less Home Owner Value (29,088,641) (29,699,188) (30,414,878) (30,606,235) (30,941,142)
Less B Inv. Value 0 0 0
Total Net Assessed Taxable Secured Value 4,468,766,203 4,580,910,829 4,750,608,897 4,537,114,676 4,156,692,782
Unsecured:
Land 262,619 623 56,456 714 781
Improvements 31,662,152 33,207,261 37,501,662 36,438,840 38,277,529
Personal Property 64,035,933 59,544,019 67,485,677 62,971,014 57,326,123
Penalty 0 0 0 0 0
Less Other Exempt (3,119,713) (7,874,926) (11,366,822) (7,990,591) (3,164,410)
Total Net Assessed Taxable Unsecured Value 92,840,991 84,876,977 93,676,973 91,419,977 92,440,023
Total Net Assessed Taxable Value 4,561,607,194$ 4,665,787,806$ 4,844,285,870$ 4,628,534,653$ 4,249,132,805$
(1) Secured values include State assessed data.
Source: County of Riverside, County Auditor Controller, Assessed Valuations
234
City of Palm Desert
Change in Taxable Value
Redevelopment Project Area # 1 - Amended
2016 versus 2015
FY 2016 2015 % Change
Secured: (1)
Land 1,672,935,655$ 1,604,125,337$ 4.3%
Improvements 3,490,703,142$ 3,325,472,649$ 5.0%
Personal Property 5,030,372$ 7,076,746$ -28.9%
Penalty 0$ 0$ 0.0%
Less Other Exempt (102,687,268)$ (102,129,288)$ 0.5%
Less Home Owner Value (25,901,471)$ (26,242,138)$ -1.3%
Total Net Assessed Taxable Secured Value 5,040,080,430$ 4,808,303,306$ 4.8%
Unsecured:
Land 96,063$ 171,444$ 0.0%
Improvements 27,636,252$ 29,097,463$ -5.0%
Personal Property 42,445,139$ 46,347,614$ -8.4%
Penalty 0$ 0$ 0.0%
Less Other Exempt (4,501,661)$ (5,274,099)$ -14.6%
Total Net Assessed Taxable Unsecured Value 65,675,793$ 70,342,422$ -6.6%
Total Net Assessed Taxable Value 5,105,756,223$ 4,878,645,728$ 4.7%
(1) Secured values include State assessed data.
Source: County of Riverside, County Auditor Controller, Assessed Valuations
235
City of Palm Desert
Historical Net Assessed Taxable Values
Redevelopment Project Area # 2
Last Ten Fiscal Years
FY 2016 2015 2014 2013 2012
Secured: (1)
Land 464,414,126$ 438,787,533$ 395,513,442$ 403,779,647$ 404,539,856$
Improvements 1,181,502,707 1,101,270,082 999,188,490 1,012,458,943 1,031,878,423
Personal Property 1,771,529 1,804,453 1,753,772 2,127,081 580,087
Penalty (2)0 0 0 0 0
Less Other Exempt (8,068,336) (10,337,993) (4,985,384) (11,014,472) (11,276,866)
Less Home Owner Value (4,116,000) (3,946,600) (3,733,800) (3,662,400) (3,697,400)
Less B Inv. Value
Total Net Assessed Taxable Secured Value 1,635,504,026 1,527,577,475 1,387,736,520 1,403,688,799 1,422,024,100
Unsecured:
Land 0 7,777 4,719
Improvements 13,360,140 14,688,768 15,098,894 11,308,677 18,513,172
Personal Property 27,474,531 27,758,561 28,706,626 26,904,564 38,744,588
Other Exemptions (15,881) (20,400) (20,639) (20,089) 0
Total Net Assessed Taxable Unsecured Value 40,818,790 42,426,929 43,784,881 38,200,929 57,262,479
Total Net Assessed Taxable Value 1,676,322,816$ 1,570,004,404$ 1,431,521,401$ 1,441,889,728$ 1,479,286,579$
FY 2011 2010 2009 2008 2007
Secured: (1)
Land 516,275,626$ 566,073,734$ 633,335,921$ 587,058,715$ 521,340,003$
Improvements 1,075,692,278 1,268,066,132 1,367,855,491 1,276,315,674 1,137,488,315
Personal Property 2,702,362 670,711 866,004 590,836 6,592,802
Penalty (2)0 0 0 0 0
Less Other Exempt (10,401,200) (8,919,361) (7,964,045) (9,550,463) (7,655,384)
Less Home Owner Value (3,750,600) (3,673,600) (3,724,000) (3,735,200) (3,752,000)
Less B Inv. Value 0 0 0
Total Net Assessed Taxable Secured Value 1,580,518,466 1,822,217,616 1,990,369,371 1,850,679,562 1,654,013,736
Unsecured:
Land 0 0 2,542 0 0
Improvements 9,474,802 14,071,375 18,201,638 5,343,621 6,215,099
Personal Property 28,314,673 34,842,003 29,865,376 20,391,298 19,806,418
Penalty 0 0 0 0 0
Total Net Assessed Taxable Unsecured Value 37,789,475 48,913,378 48,069,556 25,734,919 26,021,517
Total Net Assessed Taxable Value 1,618,307,941$ 1,871,130,994$ 2,038,438,927$ 1,876,414,481$ 1,680,035,253$
(1) Secured values include State assessed data.
Source: County of Riverside, County Auditor Controller, Assessed Valuations
236
City of Palm Desert
Change in Taxable Value
Redevelopment Project Area # 2
2016 versus 2015
FY 2016 2015 % Change
Secured: (1)
Land 464,414,126$ 438,787,533$ 5.8%
Improvements 1,181,502,707$ 1,101,270,082$ 7.3%
Personal Property 1,771,529$ 1,804,453$ -1.8%
Penalty 0$ 0$ 0.0%
Less Other Exempt (8,068,336)$ (10,337,993)$ -22.0%
Less Home Owner Value (4,116,000)$ (3,946,600)$ 4.3%
Less B Inv. Value 0$ 0$ 0.0%
Total Net Assessed Taxable Secured Value 1,635,504,026 1,527,577,475 7.1%
Unsecured:
Land 0$ 0$ 0.0%
Improvements 13,360,140$ 14,688,768$ -9.0%
Personal Property 27,474,531$ 27,758,561$ -1.0%
Other Exemptions (15,881)$ (20,400)$ -22.2%
Total Net Assessed Taxable Unsecured Value 40,818,790 42,426,929 -3.8%
Total Net Assessed Taxable Value 1,676,322,816$ 1,570,004,404$ 6.8%
(1) Secured values include State assessed data.
Source: County of Riverside, County Auditor Controller, Assessed Valuations
237
City of Palm Desert
Historical Net Assessed Taxable Values
Redevelopment Project Area # 3
Last Ten Fiscal Years
FY 2016 2015 2014 2013 2012
Secured: (1)
Land 129,471,321$ 123,846,318$ 121,112,327$ 117,624,411$ 119,303,599$
Improvements 401,446,602 388,823,244 376,571,063 367,800,719 379,322,839
Personal Property 3,729,726 3,670,712 3,866,036 3,626,212 3,461,707
Penalty 0 0 0 0 0
Less Other Exempt (22,445,566) (23,209,128) (22,949,942) (22,250,710) (19,890,920)
Less Home Owner Value (1,946,000) (1,941,800) (2,009,000) (2,041,200) (2,170,000)
Total Net Assessed Taxable Secured Value 510,256,083 491,189,346 476,590,484 464,759,432 480,027,225
Unsecured:
Land 0 0 0 0 0
Improvements 6,039,175 7,676,597 15,830,833 7,241,041 7,844,983
Personal Property 27,595,339 23,241,633 27,963,384 31,467,777 45,527,343
Penalty 0 0 0 0 0
Less Other Exempt (345,740) (423,511) (683,569) (721,058) (753,726)
Total Net Assessed Taxable Unsecured Value 33,288,774 30,494,719 43,110,648 37,987,760 52,618,600
Total Net Assessed Taxable Value 543,544,857$ 521,684,065$ 519,701,132$ 502,747,192$ 532,645,825$
FY 2011 2010 2009 2008 2007
Secured: (1)
Land 123,088,378$ 125,790,120$ 134,147,217$ 119,422,958$ 114,253,170$
Improvements 392,221,646 424,745,043 418,977,238 375,240,496 333,347,161
Personal Property 3,523,812 5,011,721 3,308,454 3,629,771 3,893,071
Penalty 0 0 0 0 0
Less Other Exempt (20,749,611) (20,847,823) (20,782,445) (19,251,214) (19,311,510)
Less Home Owner Value (2,303,000) (2,371,600) (2,331,000) (2,203,600) (2,206,400)
Total Net Assessed Taxable Secured Value 495,781,225 532,327,461 533,319,464 476,838,411 429,975,492
Unsecured:
Land 0 0 0 0 0
Improvements 8,768,007 14,220,568 18,796,505 17,795,034 13,109,332
Personal Property 70,315,349 54,874,036 45,622,109 45,542,975 44,899,884
Penalty 0 0 0 0 0
Less Other Exempt (419,433) (534,431) (549,632) (402,531) (437,726)
Total Net Assessed Taxable Unsecured Value 78,663,923 68,560,173 63,868,982 62,935,478 57,571,490
Total Net Assessed Taxable Value 574,445,148$ 600,887,634$ 597,188,446$ 539,773,889$ 487,546,982$
(1) Secured values include State assessed data.
Source: County of Riverside, County Auditor Controller, Assessed Valuations
238
City of Palm Desert
Change in Taxable Values
Redevelopment Project Area # 3
2016 versus 2015
FY 2016 2015 % Change
Secured: (1)
Land 129,471,321$ 123,846,318$ 4.5%
Improvements 401,446,602$ 388,823,244$ 3.2%
Personal Property 3,729,726$ 3,670,712$ 1.6%
Penalty 0$ 0$ 0.0%
Less Other Exempt (22,445,566)$ (23,209,128)$ -3.3%
Less Home Owner Value (1,946,000)$ (1,941,800)$ 0.2%
Total Net Assessed Taxable Secured Value 510,256,083 491,189,346 3.9%
Unsecured:
Land 0$ 0$ 0.0%
Improvements 6,039,175$ 7,676,597$ -21.3%
Personal Property 27,595,339$ 23,241,633$ 18.7%
Penalty 0$ 0$ 0.0%
Less Other Exempt (345,740)$ (423,511)$ -18.4%
Total Net Assessed Taxable Unsecured Value 33,288,774 30,494,719 9.2%
Total Net Assessed Taxable Value 543,544,857$ 521,684,065$ 4.2%
(1) Secured values include State assessed data.
Source: County of Riverside, County Auditor Controller, Assessed Valuations
239
City of Palm Desert
Historical Net Assessed Taxable Values
Redevelopment Project Area # 4
Last Ten Fiscal Years
FY 2016 2015 2014 2013 2012
Secured: (1)
Land 588,703,434$ 560,713,113$ 527,295,299$ 505,988,799$ 506,713,567$
Improvements 1,352,806,187 1,296,687,161 1,223,955,322 1,179,416,036 1,199,159,939
Personal Property 3,400,281 3,468,686 3,546,358 3,507,587 3,132,280
Penalty (2)0 0 0 0 0
Less Other Exempt (4,535,496) (4,172,455) (3,893,679) (3,542,096) (3,098,791)
Less Home Owner Value (12,909,400) (13,126,400) (13,491,800) (13,911,800) (14,345,800)
Less B Inv. Value
Total Net Assessed Taxable Secured Value 1,927,465,006 1,843,570,105 1,737,411,500 1,671,458,526 1,691,561,195
Unsecured:
Land 127,926 0 0 26,524 34,446
Improvements 1,248,156 948,724 1,037,216 803,594 948,280
Personal Property 3,648,299 4,024,300 4,670,967 2,594,779 2,347,964
Penalty (2)0 0 0 0 0
Total Net Assessed Taxable Unsecured Value 5,024,381 4,973,024 5,708,183 3,424,897 3,330,690
Total Net Assessed Taxable Value 1,932,489,387$ 1,848,543,129$ 1,743,119,683$ 1,674,883,423$ 1,694,891,885$
FY 2011 2010 2009 2008 2007
Secured: (1)
Land 535,851,149$ 571,851,472$ 612,342,380$ 589,549,492$ 538,079,392$
Improvements 1,239,148,331 1,299,807,730 1,338,202,248 1,340,102,309 1,253,230,590
Personal Property 3,145,190 3,272,357 3,221,691 4,306,781 895,558
Penalty (2)0 0 0 0 0
Less Other Exempt (3,156,884) (3,073,279) (3,034,308) (3,046,149) (2,814,993)
Less Home Owner Value (14,840,000) (14,991,200) (15,250,200) (15,577,800) (15,797,600)
Less B Inv. Value
Total Net Assessed Taxable Secured Value 1,760,147,786 1,856,867,080 1,935,481,811 1,915,334,633 1,773,592,947
Unsecured:
Land 0 0 0 0 0
Improvements 971,923 1,383,594 1,404,311 1,372,786 1,581,231
Personal Property 3,219,710 6,284,727 6,296,641 6,712,170 7,973,923
Penalty (2)0 0 0 0 0
Total Net Assessed Taxable Unsecured Value 4,191,633 7,668,321 7,700,952 8,084,956 9,555,154
Total Net Assessed Taxable Value 1,764,339,419$ 1,864,535,401$ 1,943,182,763$ 1,923,419,589$ 1,783,148,101$
(1) Secured values include State assessed data.
Source: County of Riverside, County Auditor Controller, Assessed Valuations
240
City of Palm Desert
Change in Taxable Values
Redevelopment Project Area # 4
2016 versus 2015
FY 2016 2015 % Change
Secured: (1)
Land 588,703,434$ 560,713,113$ 5.0%
Improvements 1,352,806,187$ 1,296,687,161$ 4.3%
Personal Property 3,400,281$ 3,468,686$ -2.0%
Penalty 0$ 0$ 0.0%
Less Other Exempt (4,535,496)$ (4,172,455)$ 8.7%
Less Home Owner Value (12,909,400)$ (13,126,400)$ -1.7%
Less B Inv. Value 0$ 0$ 0.0%
Total Net Assessed Taxable Secured Value 1,927,465,006 1,843,570,105 4.6%
Unsecured:
Land 127,926$ 0$ 100.0%
Improvements 1,248,156$ 948,724$ 31.6%
Personal Property 3,648,299$ 4,024,300$ -9.3%
Penalty 0$ 0$ 0.0%
Total Net Assessed Taxable Unsecured Value 5,024,381 4,973,024 1.0%
Total Net Assessed Taxable Value 1,932,489,387$ 1,848,543,129$ 4.5%
(1) Secured values include State assessed data.
Source: County of Riverside, County Auditor Controller, Assessed Valuations
241
City of Palm Desert
Historical Tax Increment/
Redevelopment Property Tax Trust Fund Summary
All Project Areas
Project Area No. 1 FY 2011/12 FY 2012/13 FY 2013/14 FY 2014/15 FY 2015/16
Gross Tax Increment 48,562,361 48,767,884 49,849,977 53,437,088 56,610,029
Less:
Housing Set-Aside* 9,712,472 9,753,577 9,969,995 10,687,418 11,322,006
SB 2557 610,071 714,717 673,261 686,944 629,449
Gross Pass-Throughs 18,843,301 18,642,892 20,111,377 21,241,903 22,961,604
Net Tax Increment 19,396,517 19,656,698 19,095,344 20,820,823 21,696,970
RPTTF Amount Deposited 29,927,559 26,848,203 25,090,381 26,530,801 24,696,424
Project Area No. 2 FY 2011/12 FY 2012/13 FY 2013/14 FY 2014/15 FY 2015/16
Gross Tax Increment 14,335,941 13,700,701 13,330,978 15,232,096 16,232,329
Less:
Housing Set-Aside* 2,867,188 2,740,140 2,666,196 3,046,419 3,246,466
SB 2557 176,347 200,429 179,214 192,900 180,457
Gross Pass-Throughs 5,381,108 4,983,714 4,967,602 5,665,961 6,078,194
Net Tax Increment 5,911,298 5,776,418 5,517,967 6,326,816 6,727,213
RPTTF Amount Deposited 7,503,009 7,568,241 7,017,531 5,441,721 5,547,427
Project Area No. 3 FY 2011/12 FY 2012/13 FY 2013/14 FY 2014/15 FY 2015/16
Gross Tax Increment 3,847,543 3,575,242 3,721,868 3,754,999 4,039,902
Less:
Housing Set-Aside* 769,509 715,048 744,374 751,000 807,980
SB 2557 49,034 52,858 49,871 48,901 45,175
Gross Pass-Throughs 1,671,676 1,277,864 1,377,700 1,371,786 1,510,219
Net Tax Increment 1,357,325 1,529,472 1,549,923 1,583,312 1,676,528
RPTTF Amount Deposited 2,088,587 1,491,532 1,357,678 1,237,930 1,290,623
Project Area No. 4 FY 2011/12 FY 2012/13 FY 2013/14 FY 2014/15 FY 2015/16
Gross Tax Increment 11,342,081 11,153,422 11,694,192 13,057,891 13,889,272
Less:
Housing Set-Aside* 2,268,416 2,230,684 2,338,838 2,611,578 2,777,854
SB 2557 143,002 164,046 156,818 166,634 154,976
Gross Pass-Throughs 6,730,420 7,530,089 7,901,830 8,381,422 8,866,804
Net Tax Increment 2,200,243 1,228,603 1,296,706 1,898,257 2,089,637
RPTTF Amount Deposited 3,910,755 4,064,105 3,675,440 3,071,966 2,443,507
*For calculation purposes only - No requirement to deposit Housing Set Aside post Redevelopment Dissolution.
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