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Home My WebLink AboutCUFR for RDA - FY Ending 6/30/07E CITY OF PALM DESERT FINANCE DEPARTMENT Staff Report REQUEST: RECEIVE AND FILE THE AUDITED FINANCIAL REPORTS FOR THE PALM DESERT REDEVELOPMENT AGENCY FOR THE FISCAL YEAR ENDED JUNE 30, 2007 DATE: JANUARY 24, 2008 CONTENTS: PALM DESERT REDEVELOPMENT AGENCY AUDITED FINANCIAL REPORT FOR THE FISCAL YEAR ENDED JUNE 30, 2007 Recommendation: By Minute Motion, that the City Council receive and file the audited Component Unit Financial Report for the Palm Desert Redevelopment Agency for fiscal year ending June 30, 2007. Background: Lance, Soll & Lunghard, LLP, performed and completed the annual independent audit for the fiscal year ended June 30, 2007, for the Redevelopment Agency in November 2007, 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 Redevelopment Agency as of June 30, 2007, and the results of its operations of the year then ended are in conformity with accounting principles generally accepted in the United States of America. In conducting their audit, the auditors test the City's internal controls. Page 3 shows 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. In connection with the above -mentioned report, a new auditing standard, Statement on Auditing Standard No. 112 (SAS No. 112), "Communicating Control -Related Matters Identified in an Internal Audit", is now in effect. Our auditors issued the following statement relative to SAS No. 112 in a letter dated November 27, 2007: "This pronouncement has the effect of increasing the likelihood that a government's independent auditors may be required to comment on internal control matters as either a significant deficiency or a material weakness in conjunction with the financial statement audit." We have provided our responses to the Internal Control comments in that letter. The Audit, Investment and Finance Committee received the audited financial statements for the Palm Desert Redevelopment Agency at their January 22, 2008 meeting, and it was recommended that the statements for the fiscal year ended June 30, 2007 be received and filed by the City Council. Submi 1 by: Approved by: u S. Gib son, bson, Finance Director/City Treasurer Carlos L. Ortega, City Manager G:\Finance\Niamh Ortega\Staff Reports\Audit staff reports 2007\audit 2007 RDA CUFR.rtf CONSENT CALENDAR X-E. AUDITED FINANCIAL REPORTS for the Palm Desert Redevelopment Agency for the Fiscal Year Ended June 30, 2007. CITY COUNCIL ACTION: APPROVED DENIED RECEIVED F, I,o OTHER MEETING DATE 1-aL4-O* AYES : Ferguson/ Fi neriy1 4)9,,// Aelson NOES: I(), , ABSENT: % e/,y ABSTAIN: 0-15/ C VERIFIED BY: ODOret Original on File with)City Clerk's Office PALM DESERT REDEVELOPMENT AGENCY PALM DESEf2T, CALIFORNIA FfNANCIAL S7ATEMENTS JUNE 30, 2007 PALM DESERT REDEVELOPMENT AGENCY JUNE 30, 2007 TABLE OF CONTENTS Page Number INDEPENDENT AUDITORS'REPORT Financial Audit 1 Compliance Audit 3 MANAGEMENT DISCUSSION AND ANALYSIS 7 BASIC FINANCIAL STATEMENTS Government-Wide Financial Statements: Exhibit A - Statement of Net Assets 14 Exhibit B - Statement of Activities 15 Fund Financial Statements: Exhibit C - Balance Sheet-Governmental Funds 16 Exhibit D - Reconciliation of Governmental Funds Balance Sheet to the Statement of Net Assets 18 Exhibit E - Statement of Revenues, Expenditures and Changes in Fund Balances-Governmental Fund Types 20 Exhibit F - Reconciliation of the Statement of Revenues, Expenditures and Changes in Fund Balances of Governmental Funds to the Statement of Activities 22 Notes to Basic Financial Statements 23 SUPPLEMENTARY INFORMATION Schedule 1 - Combining Balance Sheet-Other Governmental Funds 48 Schedule 2 - Combining Statement of Revenues, Expenditures and Changes in Fund Balances-Other Governmental Funds 49 Schedule 3 - Combining Balance Sheet-Other Governmental Funds- Debt Service 50 Schedule 4- Combining Statement of Revenues, Expenditures and Changes in Fund Balances-Other Governmental Funds—Debt Service 51 PALM DESERT REDEVELOPMENT AGENCY JUNE 30, 2007 TABLE OF CONTENTS Page Number SUPPLEMENTARY INFORMATION (Continued) Schedule 5- Combining Balance Sheet—Other Governmental Funds—Capital Projects 52 Schedule 6- Combining Statement of Revenues, Expenditures and Changes in Fund Balances—Other Governmental Funds—Capital Projects 53 Schedule 7- Combining Balance Sheet—Housing Authoriry Special Revenue Fund 54 Schedule 8- Combining Statement of Revenues, Expenditures and Changes in Fund Balances—Housing Authoriry Special Revenue Fund 56 Schedule 9 - Computation of Low and Moderate Housing Excess Surplus Funds 58 Lance Krandon W.Burrnws Donald I..Parker SO" Q 1lichael K.('hu (J[ David F..Hale Lu n g h a rd A Projeseional C�npnrafinn Donald G.Slater LLP Richard K.Kikuchi Certified Publir.lcc'OUi11l111t.� Re6red Robert C.Lance 19141994 Richard C.tiull fred J.I.unghard,Jr. 192&1999 INDEPENDENT AUDITORS' REPORT To the Honorable Mayor and Members of the City Council Palm Desert Redevelopment Agency We have audited the accompanying financial statements of the governmental activities, each major fund, and the aggregate remaining fund information of the Palm Desert Redevelopment Agency, a component unit of the City of Palm Desert, California, as of and for the year ended June 30, 2007, which collectively comprise the Agency's basic financial statements as listed in the table of contents. These financial statements are the responsibility of the Palm Desert Redevelopment Agency's mana�ement. Our responsibility is to express opinions on these financial statements based on our audit. We conducted our audit in accordance with auditing standards generally accepted in the United States of America and the standards applicable to financial audits contained in Government Auditing Standards issued by the Comptroller General of the United States. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audit provides a reasonable basis for our opinions. In our opinion, the financial statements referred to above present fairly, in all material respects, the respective financia� position of the governmental activities, each major fund and the aggregate remaining fund information of the Palm Desert Redevelopment Agency, as of June 30, 2007, and the respective changes in financial position thereof for the year then ended in conformity with accounting principles generally accepted in the United States of America. In accordance with Gouernment Auditing Standards, issued by the Comptroller General of the United States, we have also issued our report dated November 20, 2007, on our consideration of the Palm Desert Redevelopment Agency's internal control over financial reporting and on our tests of its compliance with certain provisions of laws, regulations, contracts and grants. The accompanying managemenYs discussion and analysis on pages 6 through 12 is not a required part of the basic financial statements but is supplementary information required by the Governmental Accounting Standards Board. We have applied certain limited procedures, which consisted principally of inquiries of management regarding the methods of ineasurement and presentation of the required supplementary information. However,we did not audit the information and express no opinion on it. i� Y�ARS 1929 2�04 QO F��'� 203 N.Brea I�Ivd..Suite 203� Brea,CA 92821-4056�(714)672-0022. Fax(714)672-0331 ♦«ww.lslcoas.com Lance Soll s Lunghard LLP CER71flED PUBL/C ACCWN�AN�S To the Honorable Mayor and Members of the City Council City of Palm Desert Redevelopment Agency Our audit was conducted for the purpose of forming opinions on the financial statements that collectively comprise the Agency's basic financial statements. The combining and individual nonmajor fund financial statements and Computation of Low and Moderate Housing Excess/Surplus Funds are presented for purposes of additional analysis and are not a required part of the basic financial statements. Such information has been subjected to the auditing procedures applied in the audit of the basic financial statements and, in our opinion, is fairly stated in all material respects in relation to the basic financial statements taken as a whole. �, �� November 20,2007 2 Rrandon W.Burrows Lance Donald 1,.Parkcr SO'� � �4ichael K.Chu David E.Hale �u n g h a rd A Aojessional Cw/xna�ion Donald G.Slater LLP Richard K.Kikuchi t'c�r•tified Prrhlir ,�Iccoutrta�rts Redred Robert C.Lance ivia-i�a Richard C.Sull Fred.1.I,unghard,.Ir. �vz��v99 REPORT ON INTERNAL CONTROL OVER FINANCIAL REPORTING AND ON COMPLIANCE BASED ON AN AUDIT OF FINANCIAL STATEMENTS PERFORMED IN ACCORDANCE WITH GOVERNMENT AUD177NG STANDARDS To the Honorable Mayor and Members of the City Council Palm Desert Redevelopment Agency We have audited the financial statements of the Palm Desert Redevelopment Agency as of and for the year ended June 30, 2007, and have issued our report thereon dated November 20, 2007. We conducted our audit in accordance with auditing standards generally accepted in the United States of America and the standards applicable to financial audits contained in Government Auditing Standards issued by the Comptroller General of the United States. Internal Control Over Financial Reporting In planning and performing our audit, we considered the Palm Desert Redevelopment Agency's internal control over financial reporting in order to determine our auditing procedures for the purpose of expressing our opinion on the financial statements and not to provide an opinion on the internal control over financial reporting. Accordingly, we do not express an opinion on the effectiveness of the Palm Desert Redevelopment Agency's internal control over financial reporting. Our consideration of internal control over financial reporting was for the limited purpose described in the preceding paragraph and would not necessarily identify all deficiencies in internal control over financial reporting that might be significant deficiencies or material weaknesses. However, as discussed below, we identified certain deficiencies in intemal control over financial reporting that we consider to be significant deficiencies. A control deficiency 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 misstatements on a timely basis. A significant deficiency is a control deficiency, or combination of control deficiencies, that adversely affects the Palm Desert Redevelopment Agency's ability to initiate, authorize, record, process, or report financial data reliably in accordance with generally accepted accounting principles such that there is more than a remote likelihood that a misstatement of the Palm Desert Redevelopment Agency's financial statements that is more than inconsequential will not be prevented or detected by the Palm Desert Redevelopment Agency's internal control. We consider the following deficiencies described to be significant deficiencies in internal control: 7i Y�:ARS .,,.,,_ 1929 2004 06 FJ�:I'.P�Plf� 203 N.I3rca Blvd.,Suite 203. I3rea.CA 92821-4056• (7l4)672-0022• Fax(714)G72-0331 •www�.lslcoas.com lance Shc s Lunghard LLP CERTIFIEO M1BUC ACCOVNTANTS To the Honorable Mayor and Members of the City Council City of Palm Desert Redevelopment Agency Page 2 Restatements of Prior Period Financial Statements A restatement was made to capital assets to recognize prior period additions related to improvement costs incurred at the Housing Authority's apartment complexes. A restatement was made to capital assets to reflect the removal of capitalized site improvement costs, relating to the Hovley Gardens Apartment project, which were provided to benefit very low and low income households. Design and operation of the system of internal control is the responsibility of the agency's management and the externai auditors cannot be considered part of this system of controls. Manas�ement Responses: Comment(11: A restatement was made to capital assets to recognize prior period additions related to improvement costs incurred at the Housing Authority apartment complexes. Causes and Implementation: Cause: During the first two years of Lance, Soll, and Lunghard's tenure as auditors for the City, these capital assets in the housing fund were non-existent; however, during the last three years capital assets were either purchased or constructed in the housing fund. Additionally, the account numbers for the apartment complexes were created to separate the different apartment complexes. This account structure was contrary to the norm in creating accounts, which caused them to be omitted when a capital asset account report was run, resulting in an oversight when reviewing the account balance for proper recording. In reviewing this year's draft financial statements, the Finance staff noted that the current year expenditures were not classified as capital assets. As a result, the Finance staff reviewed the prior year's expenditures and discovered that those expenditures were not classified as capital assets. The Finance staff notified the auditors of this matter, and provided fhem wifh the entry fo correct the account. Implementation: The Finance Department has modified the capital assef account report to include the apartment complex accounts. Comment 12): A restatement was made to capital assets to reflect the removal of capitalized site improvement costs related to Hovley Gardens Apartment Project, which were provided for the benefit of very low and low income households. Causes and Implementation: Cause: During the years in which the costs were capitalized and included in work-in-progress, the best information available was that the Agency would retain ownership of all improvements. However, later it was leamed that these improvements were provided for the benefit of very low and low income households. 4 Lance Soll s tunghard LLP CER�fFlEO oUBi/C ACCO:/N'ANr$ To the Honorable Mayor and Members of the City Council City of Palm Desert Redevelopment Agency Page 3 Implementation: The Finance Department will annually ask the various departments to determine if an asset meets the City's capitalization policy. A material weakness is a significant deficiency, or combination of significant deficiencies, that results in more than a remote likelihood that a material misstatement of the financial statements will not be prevented or detected by the Palm Desert Redevelopment Agency's interna( controi. Our consideration of the internal control over financial reporting was for the limited purpose described in the first paragraph of this section and would not necessarily identify all deficiencies in the internal control that might be significant deficiencies and, accordingly, would not necessarily disclose all significant deficiencies that are also considered to be material weaknesses. However, we believe that none of the significant deficiencies described above is a material weakness. Compliance and Other Matters As part of obtaining reasonable assurance about whether the financial statements of the Palm Desert Redevelopment Agency are free of material misstatements, 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. Such provisions included those provisions of laws and regulations identified in the Guidelines for Compliance Audits of California Redevelopment Agencies, issued by the State Controller and as interpreted in the Suggested Auditing Procedures for Accomplishing Compliance Audits of California Redevelopment Agencies, issued by the Governmental Accounting and Auditing Committee of the California Society of Certified Public Accountants. 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 disciosed no instances of noncompliance that are required to be reported under GoUernment Auditing Standards issued by the Comptroller General of the United States. This report is intended solely for the information of the governing board, management and the State Controller. However, this report is a matter of public record and its distribution is not limited. �, .�� '�°� �� November 20, 2007 5 THIS PAGE INTENTIONALLY LEFT BLANK 6 PALM DESERT REDEVELOPMENT AGENCY MANAGEMENT'S DISCUSSION AND ANALYSIS Our discussion and analysis of the Palm Desert Redevelopment Agency's (Agency) financial performance for the fiscal year ended June 30, 2007, provides a comparison of current year to prior year ending results based on the government-wide statements, an analysis of the Agency's overall financial position and results of operations to assist users in evaluating the Agency's financial position, and a discussion of significant changes that occurred in funds. 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 currently 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 Agency's financial statements. FINANCIAL HIGHLIGHTS • The Agency's governmental activities net assets deficit decreased$9.22 million, or 27.Q7 percent. • During the year, the Agency had revenues that were $9.84 million more than the$92.85 million in expenses recorded by the Agency in its governmental activities. • The Agency's governmental activities program revenues and general revenues increased $15.54 million, or 17.83 percent from the prior year, and program expenses increased $20.68 million, or 28.65 percent. USING THIS ANNUAL REPORT This annual report consists of a series of financia( statements. The Statement of Net Assets and Statement of Activities (on pages 14 and 15) provide information about the activities of the Agency as a whole and present a long-term view of the Agency's finances. Fund financial statements start on page 16. For governmental activities, these fund statements tell how these services were financed in the short term as well as what remains for future spending. Fund financial statements also report the Agency's operation in more detail than the government-wide statements by providing information about the Agency's most significant funds as well as the other funds. REPORTING THE AGENCY AS A WHOLE The Statement of Net Assets and the Statement of Activities: Our analysis of the Agency as a whole begins on page 14. One of the most important questions asked about the Agency's finances is, "Is the Agency as a whole better off or worse off as a result of the year's activities?" The Statement of Net Assets and the Statement of Activities report information about the Agency as a whole and about its activities in a way to answer this question. These statements include all assets and liabilities of the Agency using the accrua! 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 Agency's net assets and changes in them. Net assets are the difference between assets and liabilities, which is one way to measure the Agency's financial health, or financia! position. Over time, increases or decreases in the Agency's net assets are an indication of whether its financial health is improving or deteriorating. In the Statement of Net Assets and the Statement of Activities, we separate the Agency into general government, apartment complexes, public works, payments to other agencies and interest on long-term debt. 7 REPORTING THE AGENCY`S MOST SIGNIFICANT FUNDS Fund Financial Statements: The fund financial statements provide detailed information about the most significant funds and other funds - not the Agency 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 Agency only has governmental type funds. Governmental Funds - Most of the Agency'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 the modified accrua!basis of 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 Agency'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 Agency'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. THE AGENCY AS A WHOLE The Agency's net assets deficit decreased $9.22 million from $(34.06) million to $(24.84) miliion. Our analysis below focuses on the net deficit (Table 1) and changes in net deficit (Table 2) of the Agency's governmental activities. TABLE 1 NET ASSETS (IN MILLIONS) As of June 30, 2007 and 2006 Governmental Activities 2007 2006 Current and restricted assets $ 327.67 $ 167.82 Capital assets 164.78 125.63 TOTAL ASSETS 492.45 293.45 Long-term liabilities outstanding 461.82 279.34 Other liabilities 55.47 48.17 TOTAL LIABILITIES 517.29 327.51 Net assets (deficit): Invested in capita(assets, net of related debt 152.04 - Restricted 38.03 34.07 Unrestricted (214.91) (68.13) TOTAL NET ASSETS (DEFICIT) $ (24.84) $ (34.06) 8 Compared to the prior year, net assets deficit of the Agency's governmental activities decreased by$9.22 million. The Agency's Net Assets is made up of three components: Investment in Capital Assets, Net of Related Debt; Restricted Net Assets and Unrestricted Net Deficit. Unrestricted deficit, the part of net deficit that can be used to finance day-to-day operations, increased from $(68.13) million to $(214.91) miflion, or 215 percent. The Agency currently has an unrestricted net deficit because of the debt it has issued. Proceeds from the debt will be used for capital improvements on behalf of the City or contributed to developers. The major change in the Agency's governmental activities total assets was from current and restricted assets,which increased due to the issuance of long-term debt for the purposes of capital improvements. Total liabilities increased by S189.78 million, the major contributor to the increase is the issuance of long-term debt. TABLE 2 CHANGES IN NET ASSETS (IN MILLIONS) As of June 30, 2007 and 2006 Governmental Activities 2007 2006 REVENUES: Program Revenues: Charges for services $ 4.79 $ 4.97 General Revenues: Tax increment 82.87 77.02 Other income 2.35 1.45 Investment earnings 12.68 3.71 TOTAL REVENUES 102.69 87.15 EXPENSES: General government 15.71 7.49 Apartment complexes 5.97 6.90 Public works 13.42 6.75 Payments to other agencies 35.72 36.84 Interest on long-term debt 22.03 14.19 TOTAL EXPENSES 92.85 72.17 INCREASE (DECREASE) IN NET ASSETS 9.84 14.98 BEGINNING NET ASSETS (34.06) (49.17) RESTATEMENT OF NET ASSETS (0.62) 0.13 ENDING NET ASSETS $ (24.84) $ (34.06) 9 Governmental Activities Total revenues increased from $87.15 million to $102.69 million, a 17.83 percent increase. The major factors that contributed to the increase were the following: • Increase in property values provided additional tax increment. • New bond issuance provided additional interest earnings. Total expenses increased from $72.17 million to $92.85 million, an increase of 28.65 percent. The major factors that contributed to the increase were the following: • Cost of Falcon Crest Single-Family Homes • Reimbursement of public works projects such as Portola Bridge, Freedom Park, and the Fred Waring Sound Wall • New long-term debt issuance Although there appears to be a decrease to Payments to Other Agencies, there actually was an increase to the tax sharing entities; however last year caAed for an additional payment to be made to the State's Educational Revenue Augmentation Fund in the amount of$3.99 million. As a result, Payments to Other Agencies reflects an overall decrease of$1.12 million. The following schedu(e represents the net cost of providing services: 2007 2006 General Government $ (15.71) $ (7.49) Apartment Complexes (1.18) (1.93) Public Works (13.42} (6.75) Payment to Other Agencies (35.72) (36.84) Interest on Long-Term Debt (22.03) (14.19) TOTAL $ (88.06) $ (67.20) THE AGENCY'S FUNDS On pages 15 and 16, the governmental funds balance sheet is shown. The combined fund balance of $266.98 million increased from $117.91 million, or 126.43 percent. The Agency has reserved $83.82 million for encumbrances, continuing appropriations, loans and notes, debt service, etc. More detailed information about the combined fund balance reserves is presented in Note 11 to the financial statements. Major funds balance changes are noted below: • For the Low and Moderate Income Housing fund, fund balance increased due to the issuance of new long-term debt. • For the Housing Authority fund, fund balance increased due to the interfund transfer in from the Low and Moderate fund for improvement of the apartment complexes. • For the Redevelopment Agency Financing Authority Debt Service fund, fund balance increased due to the issuance of new debt. • The Redevelopment Agency Project Areas 1, 2, and 4 Debt Service funds, fund balance increased as a result of an increase in tax increment. 10 . The Redevelopment Agency Capital Project Areas 1 and 2 funds, fund balance increased due to the issuance of new debt. In addition to the major funds, fund balances of other governmental funds had the following changes; Capital Project Areas 3 and 4 fund balances increased due to the issuance of new debt for capital projects and Debt Service Area 3 had a minimal increase, More detailed information on the fund financial statements balances is presented in the notes to the financial statements. Budgetary Highlights During the year, with the recommendation from the Agency's staff, the Agency's Board revised the Agency budget several times. Adjustments were made on a monthly basis as the Agency's staff requested additional appropriations to cover the cost of projects that either had change orders for additional work, or the estimated cost at the beginning of the project was underestimated. At mid-year, adjustments were made as department heads requested increases or decreases to their budgets to maintain their current level of services. At year-end, budgets were adjusted for unanticipated expenditures. The Agency's Board approves all amendments that either increase or decrease appropriations. Formal budgetary integration is employed as a management control device during the year for the special revenue and capital project funds. Budgetary data for the special revenue and capitai projects funds are not presented herein, as the budgets for these funds are long-term in nature. More detailed information about the Agency's budget is presented in Note 1 (g)to the financial statements. CAPITAL ASSET AND DEBT ADMINISTRATION Capital Assets At the end of 2007, the Agency had $164.78 million invested in a broad range of capital assets, including land, buildings and improvements, apartment complexes, vehicles and equipment (See Table 3). This amount represents a net increase (including additions and deductions) of$39.15 million, or 31.16 percent over last year. TABLE 3 CAPITAL ASSETS AT YEAR-END (NET OF DEPRECIATION, IN MIILIONS) For the Years Ended June 30, 2007 and 2006 Govemmental Activities 2007 2006 Land $ 77.16 $ 50.68 Construction in progress 39.68 26.65 Buildings and improvements 47.81 48.27 Equipment 0.13 0.03 TOTAL $ 164.78 $ 125.63 11 This year's major additions included (in millions): Property acqusitions $ 24.40 Consiruction in progess for Faicon Gest/La Rax;a Villas 11.89 $ 36.29 The Agency's fiscal year 2008 capital budget calls for it to spend $45.23 million plus continuing projects of $53.05 million, the majority being the reimbursement to other governments for capital projects, land development, construction of a regional park, construction of low-income family housing, and the undergrounding of utilities. More detailed information about the Agency's capital assets is presented in Note 1(d)and Note 6 to the financial statements. Debt At year-end, the Agency's governmental activities had $461.82 million in bonds and notes versus $279.34 million last year, an increase of$182.48 million,or 65.32 percent as shown in Table 4. TABLE 4 OUTSTANDING DEBT AT YEAR END (IN MILLIONS) For the Years Ended June 30, 2007 and 2006 Governmental Activities 2007 2006 Notes payable $ 0.69 $ 0.74 Advances 32.79 32.79 Revenue bonds and notes(backed by specific tax and fee revenues) 428.42 245.81 TOTA�.S � 461.82 $ 279.34 The Agency was able to meet its current year debt obligation in a timely manner. Debts issued in the prior year have been used to finance various capital projects. An example of this would be the purchase of land, and construction of the City's golf course. ECONOMIC FACTORS AND NEXT YEAR'S BUDGETS In preparing the budget for 2008, management looked at the following economic factors: • In prior years, the City had unallocated reserves in its capital projects and special revenue funds that could be used to start and complete Agency's projects in an effort to maximize the Agency's cash flow. In the five-year capital improvement program, all restricted capital funds for the City have been allocated to various projects. Any additional projects would require that the Agency fund their own projects. • Issue of new bonds for capital projects. 12 The City continues to grow with new hotels, commercial and residential development, construction of a four-year university, street improvements, park construction, and various other improvement projects. The 2008 capital improvement project budget is a reflection of the Agency's commitment to the residents of Palm Desert. A copy of the City's 2007-2008 financial plan can be obtained by contacting the City Finance Department(See below). CONTACTING THE AGENCY'S FINANCIAL MANAGEMENT This financial report is designed to provide our citizens, taxpayers, customers, and investors and creditors with a general overview of the Agency's finances and to show the Agency's accountability for the money it receives. If you have questions about this report or need additional financial information, contact the City's Finance Department at the City of Palm Desert, 73-510 Fred Waring Drive, Palm Desert, California 92260-2578, or(760) 346-0611. 13 PALM DESERT REDEVELOPMENT AGENCY Exhibit A STATEMENT OF NET ASSETS JUNE 30,2007 Governmental Activities Assets: Cash and investments $ 112,359,089 Receivables 13,940,385 Property held for resale 11,799,806 Prepaid items and deposits 593,273 Deferred charges 11,216,795 Restricted assets: Cash with fiscal agent 177,760,271 Capital assets (net of accumulated depreciation) 164,778,115 Total Assets $ 492,447,734 Liabilities: Accounts payable $ 8,709,293 Accrued liabilities 160,083 Interest payabte 6,285,493 Deposits payable 336,371 Unearned revenue 20,241 Amounts due under pass-through agreements 39,963,660 Noncurrent liabilities: Due within one year 10,700,145 Due in more than one year 451,116,445 Total Liabilities $ 517,291,731 Net Assets: Invested in capital assets, net of related debt $ 152,040,269 Restricted for: Special Projects 38,027,686 Unrestricted (deficit) (214,911,952� Total Net Assets $ (24,843,997) See Notes to Financial Statements 14 PALM DESERT REDEVELOPMENT AGENCY Exhibit B STATEMENT OF ACTIVITIES FOR THE YEAR ENDED JUNE 30,2007 Net(Expense) Revenue and Changes in Program Revenues Net Assets Operating Capital Charges for Grants and Grants and Governmental Functions/Programs Expenses Services Contributions Contributions Activities Primary Government: Governmental Activities: General administration $ 15,705,471 $ - $ - $ - $(95,705,471) Apartment complexes 5,972,572 4,788,974 - - (1,183,598) Public works 13,418,438 - - - (13,418,438) Payments to other agencies 35,719,075 - - - (35,719,075) Interest on long-term debt $22,036,844 - - - (22,036,844) Total Primary Government $92,852,400 $ 4,788,974 $ - $ - 3(88,063,426) General Revenues: Taxes: Tax increment $ 82,867,337 Rental income 4,020 Gain (loss)on sale of land 601,556 Other revenues 1,748,852 Investment earnings 12,680,013 Total General Revenues 97,901,778 Change in Net Assets $ 9,838,352 Net Assets-Beginning of Year, as originally reported $ (34,060,655) Restatement (621,694) Net Assets -Beginning of Year, as restated (34,682,349) Change in Net Assets 9,838,352 Net Assets -End of Year $(24,843,997) See Notes to Financial Statements 15 PALM DESERT REDEVELOPMENT AGENCY BALANCE SHEET-GOVERNMENTALFUNDS JUNE 30,2007 Special Revenue Funds Debt Service Funds Low and Moderate income Housing Project Project Housing Authority Area 1 Area 2 Assets: Cash and investments $ 11,072,175 $ 10,345,546 $ 53,327,195 $ 1Q,713,652 Cash with fiscal agent-restricted 42,608,268 320,871 5,742 - Receivables 8,530,691 64,242 892,456 182,061 Due from other governmental agencies 10,000 - - - Property held for resale 11,799,806 - - - Prepaid costs and deposits 3,557 - - - Due from other apartment - 4,309,751 - - Total Assets $ 74,024,497 S 15,040,410 $ 54,225,393 $ 10,895,713 Liabilities and Fund Balances: Liabilities: Accounts payable $ 2,835,973 $ 808,962 $ - $ - Accrued liabilities 13,077 119,578 - - Deposits payable 500 320,871 - - Deferred revenue 281,721 - - Unearned revenue 2,368 17,873 - - Due to other apaRment - 4,309,751 - - Amounts due-pass-through agreement - 24,128,637 1,697,302 Total Liabilities 3,133,639 5,577,035 24,128,637 1,697,302 Fund Balances: Reserved 38,877,935 9,463,375 - - Unreserved 32,012,923 - 30,096,756 9,198,411 Total Fund Balances 70,890,858 9,463,375 30,096,756 9,198,411 Total Liabilities and Fund Balances $ 74,024,497 � 15,040,410 3 54,225,393 b 10,895,713 See Notes to Financial Statments 16 Exhibit C Debt Service Funds Capital Project Funds Other Total Project Financing Project Project Governmental Governmental Area 4 Authority Area 1 Area 2 Funds Funds $ 15,091,196 $ - $ 4,710,431 $ - $ 7,098,894 $112,359,089 - 12,215,862 34,037,303 45,447,458 43,124,767 177,760,271 243,416 51,473 1,576,008 201,425 2,188,613 13,930,385 - - - - - 10,000 - - - - - 11,799,806 - - 589,716 - - 593,273 - - - - - 4,309,751 5 15,334,612 $ 12,267,335 $ 40,913,458 $ 45,648,883 $ 52,412,274 $320,762,575 $ - $ - $ 2,723,642 $ 281,637 $ 2,059,079 $ 8,709,293 - 27,428 - - 160,083 - - - - 15,000 336,371 - - - - - 281,721 - - - - - 20,241 - - - - - 4,309,751 12,773,322 - - - 1,364,399 39,963,660 12,773,322 - 2,751,070 281,637 3,438,478 53,781,120 - 123,500 16,086,272 3,345,834 15,924,223 83,821,139 2,561,290 12,143,835 22,076,116 42,021,412 33,049,573 183,160,316 2,561,290 12,267,335 38,162,388 45,367,246 48,973,796 266,981,455 $ 15,334,612 $ 12,267,335 $ 40,913,458 $ 45,648,883 $ 52,412,274 $320,762,575 See Notes to Financial Statments 17 PALM DESERT REDEVELOPMENT AGENCY Exhibit D RECONCILIATION OF GOVERNMENTAL FUNDS BALANCE SHEET TO THE STATEMENT OF NET ASSETS June 30, 2007 Total fund balance for governmental funds $ 266,981,455 Amounts reported for governmental activities in the statement of net assets are different because: When capita!assets (land, buildings, equipment)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 assets includes those capital asseis among the assets of the Agency as a whole: Beginning Balance, net depreciation $ 125,628,852 Prior Period Adjustment (1,102,860) Current year additions 53,531,968 Current year deletions (11,339,677) Current year depreciation {1,940,168) Ending Balance, net depreciation $ 164,778,115 164,778,115 Long-term liabilities applicable to the Agency's governmental activities are not due and payable in (461,816,590) the current period and, accordingly, are not reported as fund liabilities. All liabilities, both current and long-term, are reported in the statement of net assets. Interest on long-term debt is not accrued in governmental funds, but rather is recognized as an (6,285,493) expenditure when due. Interest earned but not received within the availability period 281,721 The cost of issuing bonds is recognized as an expenditure in the period paid, however, in the statement of net assets, it is amortized over the life of the bonds. 11,216,795 Net assets of governmental activities $ (24,843,997) See Notes to Financial Statements 18 THIS PAGE INTENTIONALLY LEFT BLANK 19 PALM DESERT REDEVELOPMENT AGENCY STATEMENT OF REVENUES,EXPENDITURES AND CHANGES IN FUND BALANCES GOYERNMENTAL FUND TYPES FOR THE YEAR ENDED JUNE 30,2007 Special Revenue Fund Debt Service Funds Low and Moderate Income Housing Project Project Housing Authority Area 1 Area 2 Revenues: Taxes $ - $ - $ 48,895,277 $17,072,105 Investment eamings 1,697,593 279,848 2,223,025 472,203 Rental earnings 4,020 4,509,126 - - Other revenues 181,896 - 506,990 - Total Revenues 1,883,509 4,788,974 51,625,292 17,544,308 Expenditures: Current: General govemment 3,945,115 5,972,572 15,319 7,959 Payments to other agencies - - 19,638,157 6,848,216 Public works - - - _ Capital outlay 10,276,057 6,018,318 - - Debt service: Interest and fiscal charges - - 913,090 1,074,760 Principai retirement _ - _ �22,7p7 Total Expenditures 14,221,172 11,990,890 20,566,566 8,053,642 Excess of Revenues Over(Under)Expenditures (12,337,663) (7,201,916) 31,058,726 9,490,666 Other Financing Sources(Usesj: Sale of property 4,480,000 - - - Long-term debt issued - - _ _ Bond premiums _ _ _ _ Payment to refunding bond escrow agent - - _ _ Transfers in 65,805,007 12,540,701 - - Transfersout (16,275,606) (1,000,000) (30,850,921) (8,496,879) Total OtherFlnancing Sources(Uses) 54,009,401 11,540,701 (30,850,921) (8,496,879) Excess of Revenues and Other Financing Sources Over(Under)Expenditures and Other Financing Uses $ 41,671,738 $ 4,338,785 $ 207,805 $ 993,787 Fund Balances,Beginning of Year $ 28,737,954 $ 5,124,590 $ 29,888,951 $ 8,204,624 Restatements 481,166 - - - Fund Balances,Beginning of Year 29,219,120 5,124,590 29,888,951 8,204,624 Excess of Revenues and Other Financing Sources Over(Under)Expenditures and Other Financing Uses 41,671,738 4,338,785 207,805 993,787 Fund Balances-End of Year S 70,890,858 3 9,463,375 S 30,096,756 E 9,198,411 See Notes to Fianancial Statements 20 Exhibit E Debt Service Funds Capital Project Funds Other Total Project Financing Project Project Govemmental Govemmental Area 4 Authority Area 1 Area 2 Funds Funds $ 13,336,924 $ - $ - $ - $ 3,563,031 $ 82,867,337 156,358 618,618 2,394,758 2,558,744 2,482,120 12,883,267 _ _ _ - - 4,513,146 - 292,858 692,750 20 74,338 1,748,852 13,493,282 911,476 3,087,508 2,558,764 6,119,489 102,012,602 7,201 - 2,273,566 414,206 390,704 13,026,642 7,426,336 - - - 1,806,366 35,719,075 - - 7,591,422 3,354,818 2,472,198 13,418,438 - - 13,764,323 16,902,018 6,571,252 53,531,968 292,738 23,253,205 - - 91,269 25,625,062 - 7,T05,000 - - - 7,827,707 7,726,275 30,958,205 23,629,311 20,671,042 11,331,789 149,148,892 5,767,007 (30,046,729) (20,541,803) (18,112,278) (5,212,300) (47,136,290) - - 750,000 - - 5,230,000 - 284,369,894 - - - 284,369,894 - 7,785,375 - - - 7,785,375 - (101,656,501) - - - (101,656,501) - 22,683,605 49,632,640 52,952,957 32,163,642 235,778,552 (4,932,009) (172,028,119) (231,113) (274,022) (1,689,883) (235,778,552) (4,932,009) 41,154,254 50,151,527 52,678,935 30,473,759 195,728,768 $ 834,998 $ 11,107,525 $29,609,724 $34,566,657 $ 25,261,459 $ 148,592,478 $ 1,726,292 $ 1,159,810 $ 8,552,664 $ 10,800,589 $ 23,712,337 $ 117,907,811 - - - - - 481,166 1,726,292 1,159,810 8,552,664 10,800,589 23,712,337 118,388,977 834,998 11,107,525 29,609,724 34,566,657 25,261,459 148,592,478 S 2,561,290 S 12,267,335 5 38,162,388 5 45,367,246 S 48,973,796 3 266,981,455 See Notes to Fianancial Statements 21 PALM DESERT REDEVELOPMENT AGENCY Exhibit F RECONCILIATION OF THE STATEMENT OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCES OF GOVERNMENTAL FUNDS TO THE STATEMENT OF ACTIVITIES June 30,2007 Net change in fund balances -total governmental funds $ 148,592,478 Amounts reported for govemmental 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 depreciation expense. This is the amount by which capital additions/deletions($42,192,291) exceeded depreciation ($1,940,168) in the current period. 40,252,123 Repayment of long-term debt is reported as expenditures in governmental funds and, thus, has the effect of reducing fund balance because current financial resources have been used. For the Agency as a whole, however, the principal payments reduce the liabilities in the statement of net assets and do not result in an expense in the statement of activities. 109,401,672 Proceeds of long-tern debt are reported as revenue in governmental funds, however, the receipts of long-term debt increase liabilities in the statement of net assets and do not result in revenues in the statement of activities. (284,369,894) 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. (2,990,217) The cost of issuing bonds is recognized as an expenditure in the period paid, however, in the statement of net assets, it is amortized over the life of the bonds. 6,382,935 Premium on bonds is recognized as an expenditure in the period paid; however, in the statement of net assets it is amortized over the life of the bond. (7,507,339) Revenue will not be collected within 60 days of the Agency's fiscal year end and, therefore, are not considered available in the governmental funds: Interest not received on development disposition agreement 76,594 Change in net assets of governmental activities $ 9,838,352 See Notes to Financial Statements 22 PALM DESERT REDEVELOPMENT AGENCY NOTES TO BASIC FINANCIAL STATEMENTS JUNE 30, 2007 I. SIGNIFICANT ACCOUNTING POLICIES Note 1: Summary of Signiflcant Accounting Policies a. Basis of Presentation Government-Wide Financial Statements The government-wide financial statements (i.e., the statement of net assets and the statement of activities) report information on all of the activities of the Agency. 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. The Palm Desert Redevelopment Agency has no business-type activities. The statement of activities demonstrates the degree to which the direct expenses of a given function or segment are offset by program revenues. Direct expenses are those that are clearly identitiable with a specific function or segment. Program revenues include: 1) charges to customers or applicants who purchase, use or directly benefit from goods, services or privileges provided by a given function or segment, and 2)grants and contributions that are restricted to meeting the operational or capital requirements of a particular function or segment. Taxes and other items not properly included among program revenues are reported instead as general revenues. Separate financial statements are provided for the governmental funds. Major individual governmental funds are reported as separate columns in the fund financial statements. Fund Financial Statements The accounting system of the Agency 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, fund equify, revenues and expenditures. An emphasis is placed on major funds within the governmental category. A fund is considered major if total assets, liabilities, revenues or expenditures of that individual governmental fund are at least 10% of the corresponding total for all funds of that category or type. The funds of the Agency are described below: Governmental Fund Types 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. 23 Palm Desert Redevelopment Agency Notes to Financial Statements(Continued) Note 1: Summary of Significant Accounting Policies(Continued) 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 Proiects Funds - Capital Projects Funds are used to account far financial resources to be used for the acquisition or construction of major capital facilities. The Agency's major governmental funds are as follows: The Low and Moderate Income Housinq Saecial Revenue Fund is used to account for the tax increment set-aside to be spent on projects that benefit low and moderate-income families. The Housinq Authoritv Fund is used to account for financial resources to be used for the leasing of agency-owned properties. Proiect Area 1 Debt Service Fund is used to account for the tax increment revenues and expenditures of Project Area 1. Proiect Area 2 Debt Service Fund is used to account for tax increment revenues and expenditures of Project Area 2. Proiect Area 4 Debt Service Fund is used to account for tax increment revenues and expenditures of Project Area 4. The Financinq Authoritv Debt Service Fund is used to account for the resources and payment of the debt issued by the Palm Desert Financing Authority and loaned to the Redevelopment Agency. Proiect Area 1 Capital Proiect Fund is used to account for financial resources to be used for the acquisition or construction of major capital facilities in Project Area 1. Proiect Area 2 Capital Proiect Fund is used to account for financial resources to be used for the acquisition or construction of major capital facilities in Project Area 2. b. Measurement Focus and Basis of Accounting Measurement Focus 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. On the government-wide statement of net assets and the statement of activities, activities are presented using the economic resources measurement focus. Under the economic resources measurement focus, all (both current and long-term) economic resources and obligations of the government are reported. In the fund financial statements, all governmental funds are accounted for on a spending or "financial flow" measurement focus. This means that only current assets and current liabilities are general�y included on their balance sheets. Their reported fund balances (net current assets)are considered a measure of"available spendable 24 P�rn D��t Ric�iElcpn�rt Agency Ilat�st� Fi�xui�ISlalerre�t� ��tn�ed� Ilat� 1: Sumnar1 �fSgnilicant.4ccauntlrgPo6cies(Continued) res�u-ae�." Go✓erine-��I firnd operating statements present increases (revenues and atl�r fn�r�cing sorr��)aid decreases (expenditures and other financing uses) in reta�na�tac�G. I�bicunentp�rrim� ofirng-�irn receivables due to governmental funds are reported on the� b�ta-��e �F�eets, in spite of their spending measurement focus. Special rep�►irg U�tnerts arE �sed to indicate, however, that they should not be c>rside�ed"avai�hle �pendable resources" since they do not represent net current ac�1s. nrn a..irenl p o-b�s of longterm receivables are offset by fund balance resene�a�irts Bassc�l Ac�aiitng I n he gwe rn rn ai�uiGe ��e�ent of net assets and statement of activities, the go�einneryal acf�ities a-e presented using the accrual basis of accounting. Under the accr�� b�ss ef accaintng, revenues are recognized when earned and e��ns�s �re recorded vten the liability is incurred or economic asset used. F�ven�e�, e��ises, c��ins, bsses, assets and liabilities resulting from exchange �idecd�ir�t-Ike Ya�c�ions are recognized when the exchange takes place. I n U e fu rd fi�aici� s te te n�Fs, govemmental funds are presented on the modified acaual 6acia of a�a�n�q. Under this modified accrual basis of accounting, rev�rues a-e �ecag�itEti v�en "measurable and available." Measurable means kiovng oi being �be b reasonably estirnate the amount. Available means calledi4le nAFin he curieet period or soon enough thereafter to pay current liablibec.6cpendtires �ieallr are recorded when a liability is incurred, as under acaual �aoo rtiig Houeve-, debt service expenditures are recorded only when p�ymert 's due. Re�,ei�� t�ataiesusce�ible b accrual include property taxes that are levied for aid d�e (or t�e fisc�l yta a�d cdlected within 60 days after year-end. Property taces, r�rtsaiE int�re� �ssac'�ted with the current fiscal period are all considered to be �i.s��tble lo �cr�al ar�c1 so have been recognized as revenues of the current Fisc�f p�rbd. AI athei ie�enue items are considered to be measurable and available �ely uF�en ca�his reae'vedbr �e government. 25 Palm Desert Redevelopment Agency Notes to Financial Statements(Continued) Note 1: Summary of Significant Accounting Policies(Continued) c. Differences between Government-Wide Financial Statements and Fund Financial Statements: Explanation of differences befinreen Governmental Funds Balance Sheets and the Statement of Net Assets: Long-Term Debt Redassifi- Total Capihal Transactions/ cations Statement Govemmental Related Interest and of Net Funds Items Payable Elirrinatioris /�ssets Assets: Cash and investrnents $ 112,359,089 $ - $ - $ - $ 112,359,089 Cash withfisqf agent 177,760,271 - - - 177,760.271 Receivables 13,940,385 - - - 13,940,385 Property held for resale 11,799,806 - - - 11,799,806 Duefromotherapartmerrt 4,309,751 - - (4,309,751) - Prepaid items and deposiCs 593,273 - - - 593,273 Deferred charges - - 11,216,795 - 11,216,795 Capital assets - 164,778,115 - - 164,778,115 Total Assets 320,762,575 164,778,115 11,216,795 (4,309,751) 492,447,734 Liabil ities: Aco�unts payable 8,709,293 - - - 8,709293 Acaued liabilities 160,083 - - - 160,083 Interest payable - - 6,285,493 - 6,285,493 Deposits payable 336,371 - - - 336,371 Deferred re�nenue 281,721 - - (281,721) - Uneamed revenue 20,241 - - - 20,241 Due to other apartment 4,309,751 - - (4,3o9,751) - Amounis due under pass-through agreemenls 39,963,660 - - - 39,963,660 Long-term liabilities-cuRent - - 10,700,145 - 10,700,145 Long-te�m liabilities- noncurrent - - 451,116,445 - 451,116,445 Tohal Liabilities 53,781,120 - 468,102,083 (4,591,472) 517,291,731 Net Assets (Defidt) $ 266,981,455 $ 164,778,115 $ (456,885,288) $ 281,721 $ (24,843,997) 26 Palm Desert Redevelopment Agency Notes to Financial Statements(Continued) Note 1: Summary of Significant Accounting Policies(Continued) Explanation of differences between Governmental Funds Operating Statements and the Statement of Activities: Rec�ss- Total Capifaf l.ong-Tertn Costof ifica6ms Staterrerd Goverrmenhal Related Debt Acaued Issuancd ard of Funds 16ems Transactims Inteiast pamanount Efminatims Activities Reaenues: Ta�es $ 82867,337 S - S - $ - $ - $ - S 82,867,337 Investrrent�mings 12,883,267 - - - (273,254} 12,680,013 Rental ncorne 4,513,146 - - - - (4,509,12fi) 4,0� Apertrnent comple�s - - - - - 4,788,974 4,788,974 Otherincome 1,748,852 - - - - - 1,748,852 Tdal Revenues 102012,802 - - - - 78,594 102,089,196 E�endtwes: Cirrent GeneralgDverrxnent 13,026,642 8,651,401 - - - (5,972,572) 15.7U5,471 Payment to other apencies 35,719,075 - - - - 35,719,075 Apartment arnpe�es - - - - - 5,972572 5,972572 PuWicwarks 13,418,438 - - - - 13,418.438 Capital outiay 53,531,966 (53,531,968) - - - - - Debt senice: _ Intaestardfiscal cFc�rges 25,625,062 - (195,500) 2990,217 (6,382,93� - 71,036,844 Rincipal ret'remer� 7.827.707 - (7.871,7C1� - - - - Total E�endiWies 149,148,892 (44.880,567) (B4Ozi.20� 2990,217 (6,382,9Ci� - 92,852400 OtherFinanmg Sou�es(Uses): Sa�e d properry 5,23�,000 (4,628,444) - - - - s0i.556 Borcf proCeeds 284.368,894 - (2b4,3�,894) - - - - Borcl p2mums 7,785,375 - (7.785,375) - - - - Faymentcorefu,dingrondaga,t (to�,s5s,9o1) - tol,sss,5o� - - _ _ Trans(ers in 235,778,552 - - - - (235,Tl8,552) - Transfers out (235�778,55� 236,778,552 Total Other Fnancng 195,728.768 (4,628,444) (190,498.768) - - - 601.556 Net Ch2nge in Fund Balance $ 148,592,478 $ 40,252123 $ (182.475.581) $ (2990.21� $ 6.382.905 $ 76.594 $ 9,838.352 d. Capitai Assets and Depreciation Capital assets are reported in the government-wide financial statements. Capital assets are defined by the Agency 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 estimated fair market value at the date of donation. The Agency had no infrastructure assets. 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. 27 Palm Desert Redevelopment Agency Notes to Financial Statements(Continued) Note 1: Summary of Significant Accounting Policies(Continued) Property, plant and equipment are depreciated using the straight-line method over the following estimated useful lives: Assets Years Buildings 40 Improvements other than buildings 20 Machinery and equipment 5-8 e. Long-Term Obligations In the government-wide financial statements, long-term debt and other long-term obligations are reported as liabilities. Bond premiums and discounts, as well as issuance costs, are deferred and amortized over the life of the bonds using the effective interest method. Bonds payable are reported net of the applicable bond premium or discount. Bond issuance costs are reported as deferred charges and amortized over the term of the related debt. In the fund financial statements, governmental fund types recognize bond premiums and discounts, as well as bond issuance costs, during the current period. The face amount of debt issued is reported as other financing sources. Premiums received on debt issuances are reported as other financing sources while discounts on debt issuances are reported as other �nancing uses. Issuance costs, whether or not withheld from the actual debt proceeds received, are reported as debt service expenditures. f. Fund Equity In the fund financial statements, governmental funds report reservations of fund balance for amounts that are not available for appropriation or are legally restricted by outside parties for use for a specific purpose. Designations of fund balance represent tentative management plans that are subject to change. g. Budgetary Accounting The Agency uses the following procedures in establishing its budgetary data reported in the financial statements: 1. Before the beginning of the fiscal year, the Executive Director submits to the Board of Directors 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. Original appropriations are modified by supplementary appropriations and transfers among budget categories. The Board approves all significant changes. Annual appropriations lapse at year-end. 5. Encumbrances and Continuing Appropriations are rebudgeted as of July 1 by Board action. They are reported as reservations of fund balance in the fund-level financial statements. 28 Palm Desert Redevelopment Agency Notes to Financial Statements(Continued) Note 1: Summary of Significant Accounting Policies{Continued) 6. Formal budgetary integration is employed as a management control device during the year for the Special Revenue and Capital Projects Funds. Formal budgetary integration is not employed for Debt Service Funds because effective budgetary control is alternatively achieved through debt indenture provisions. 7. Budgets are adopted on a basis consistent with accounting principles generally accepted in the United States of America. Budgetary data for the Special Revenue Funds and Capital Projects Funds are not presented herein, as the budgets for these funds are long-term in nature. h. Investments Investments are stated at fair value (quoted market price or fhe best available estimate thereof). i. Property Held for Resale The Agency purchased land within the Agency's project area. The land held for resale is recorded in the Redevelopment Agency Special Revenue Fund as property held for resale, at the lower of acquisition cost or net realizable value. At June 30, 2007, the cost of the property held for resale for various housing properties in Palm Desert totaled S11,799,806. j. Prepaid Items and Deposits Certain payments to vendors reflect costs applicable to future accounting periods are recorded as prepaid items in the government-wide and fund financial statements. The Agency has deposited $571,281 with Coachella Valley Water District for future sewer connection charges at the Indian Springs Mobile Home Park and $2,609 in escrow to purchase various properties. An additional �19,383 of miscellaneous prepaid items is included in this account. k. Property Tax Calendar Property taxes are assessed and collected each fiscal year according to the following property tax calendar: Lien Date January 1 Levy Date July 1 to June 30 Due Date November 1 - 1 st Installment March 1 -2nd Installment Delinquent Date December 10- 1st Installment April 10 -2nd Installment Under California law, property taxes are assessed and collected by the counties up to 1% of assessed value, plus other increases approved by the voters. The property taxes go into a pool, and are then allocated to the agencies based on complex formulas prescribed by the state statutes. 29 F�M Oe�a-t Fiei eve I��rren t�e ncj Nblec IoRra�dai Stit�ne�is(Cminu�d� Pbte'1; S�x�rrayol Si�rifc�rt Aacoarti�g Pdicies (Continuedj L R�ai�nshiptatle6tr efPaMOesert TheP�1n De�k RedevebprrentAgency is an integral part of the reporting entity of the C it,i�i PaFn �ea�t, Caif�n i�_ Th e fu nds and account groups ot the Agency have been nd�.dad�niriii h� ecaped he Dasicfinancial statements of the City because the City Ca.�idl afthedt� af P�(m Dese�t exercises oversight responsibility over the operations afihe A9e�ry.4rlythef�ndsand account groups of the Agency are included herein and hes� iraid�al ��e�riert$ harefore,do not purport to represent the financial position or iesutsd aperafo�sd i�e CiQ� ofPalm Desert. Nole2: Org�rizition a�dTaa hcr�n�antFirrancing lhe Age-i�y i� a separate gav�rnrnenlal entity as prescribed in the Cafifomia Community Reiavelpp-r�atl�vaidas s� b�th ie Ihe Health and Safety Code of the State of California. lhe P.gencycansi�ts aF Pr�jed Area 1, ProjectArea 2, Project Area 3 and Project Area 4. In addti�r� t�e Aye�cyanG h� Ciy aF Palm Desert (the City) have established the Palm D�ertFnanci�q �.ctb�ty asajdrt pov�er ofauthority between the Agency and the City for p�ip�sea uffnan�iig a�l fun�rpcapital improvements. Transactions related to the joint poNarfcr he Ac��q� �re iecorc�E in a debf service fund. lF� Palm D�sed ka.i�irgAut�a-itywas established in January 1998, as a component unit of the A�nc� �rdisparlly r��arisille br E-ie administration of providing affordable housing in the Cityd Palrn Deset. -The a�a�tmer-� cornplexes owned by the Housing Authority are q�e re ted ta�a rrra��rren tco n��y. rhe transactions related to the Housing Authority are reportedina�tdal Rere�ieFuad A�nc� e�perses incl.�le c-apital impro�,ement projects and operating costs which include rEqu�edstaA supp�t �rd cros�ttanl services_ �1f-ie Age��ys Erin�r� �a.�cd �f revenue cornes from property taxes, referred to in the �ccxrpa�ri�gfina-�cial itaternentc as'Yax increment revenue." The assessed valuation of all p-q�erlyv�lin�ct-ipio�ct area v�determined on the date of adoption of the Project Area. Ex��i br aeRan arno�rts {rwcied by specific ag�eement (see Note 7), property taxes rel�ted to t�� nrerne�til ir�rEase n assessed values after the adoption of the Project Area t�Te leen albcaled ta t�e Ape�cy, whie all property taxes on the "frozen" assessed �al,at i�n�ofthead�ion d�e F��e been allocated to the City and other districts. Nr�te3: Casi ar�ilrv�stnei� C�h aM irve.st-rt��t� re�Qted iR f-ie accompanying financial statements consisted of the f�lbviig C�� nl n�,e�redsp�o�C With ihe City � 112,359,089 C�� ird n�e�reRswthfitcalagent 177,760,271 $ 290,119,360 lf�e Agen cy's lu��aie paded niih the C ity of Palm DeserYs cash and investments in order te ge�erate �ptir�in n�iest in�mie. The City has irnplemented GASB Statement No. 40, aePast �rGlrvesf�reitF?'si Drido�u�es. GASB No. 40 establishes and modifies disclosure req,��erertts ie��d b depotit and investment risks. The information required by GASB St�e�e�tN�.41 ie��d m a�tbi�d 'nveslments, credit risk, etc., is available in the annual repcak oftF�Cty. 34 Palm Desert Redevelopment Agency Notes to Financial Statements(Continued) Note 4: Loans, Notes Receivable and Due from Other Governmental Agencies Receivables consisted of the following at June 30, 2007: Lnw and aner Modaate Debt Service Gwan Total Incane Housing Projed Prqect P�ojed Fnancng Project Project mental Govemme�tal Housing Authaity A�ea 1 Area 2 Area 4 Authorty Area 1 Area 2 Funds ReceNades Accaints $ 369,252 S 4,115 S 892,456 3 182,061 $ 243,416 $ - $ 81,786 $ 477 $ 37,607 S 1,811,170 Interest 461,833 60,127 - - - 51,473 1,494,222 200,948 151,006 2,4t3,609 Loans 40,1� - - - - - - - - 40,169 Due from Other Govemmenis 10.000 - - - - - - - - 10,000 Nol� 7,659,437 - - - - - - - 2,000,000 9,659,437 5 8,540,691 $ 64,242 $ 892456 $ 182,061 $ 243,416 $ 51,473 $ 1,576,008 $ 201.425 S 2188,613 $ 13,940,385 Loans Receivable a. The Agency has loaned $18,862 in below market loans, secured by deeds of trust, to eligible low-income households. Monthly payments of interest and principal are due over a period of 30 years unless the homes are sold, in which case the entire loan balance is due and payable. b. The Agency has $21,307 in home improvement loans. Payments of interest and principal are due monthly on these loans. c. The Agency has issued 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 where there is a significant possibility that these loans either become uncollectible or forgiven by the Agency at a future date if afl the terms of the loans have been met. 31 PaMOesetF�le✓�I�p�eitAg�r�� f�biec bFninc'ral Strt�n�ls(Coniru�c� Nble4: ln�ns, 11ot�R�aeiv+deanl Duef�mOtherGovernrnental Agencies(Continued) Odal�liriorn�limfQ hese birsisasfollows: I�� Bdace Irteest I✓laturity Pin�d ('�irt�e U.ibtaidr� Rate Date Secured B}r Special Provisions of Loan Sef-Heb S �2l,m0 7.�i% 30years Deed of Trust Loan balance and i�erest F��siigPmgan or2024 due upon maturity, unpaid balarx:e of loan or interest will bear an interest rate of 12%. Hrn-M In�ro�er�nl 7�,�5 NW WA Deed of Trust Loan is payable upon L�ais change or transfer of title, • refinanang or upon the death of the borrower. Potc!-aPans 21],�5 3_ODYo 30years Deed ofTrust Loan balance and interest I�,bbl�m�s P�Ic from date will be forgiven at maturity of loan 'rf debtor does not breach the temis and conditions of either the unit regulatory aareement or note. Dc�ert Rcse t,T7fi�0 S.�Yo 30years Deed of Trust Loan will be forgive� at fr�m date maturiry unless the debtor ofloan is in violation of the unit regulatory agreernent or the deed of trust. FaCrn Cns1 �2?�9 l_O�Yo 45years DeedofTrust Loan is payable upon from d�e change or transfer of tiUe, ofloan refinanang or upon the death of the borrower. Aqia'sibi, $ 'BQ510 1.mYo 30years DeedofTrust Loan balance and interest Relabiltafa, from date Assignment will be forgiven at maturiry Rc�� ofloan of Rent if debtor does not breach the temis and oonditions of either the unit regulatory aareement or note. I�b�� Receival(e A I�a-irec�i�able la he crnstruction ofa multi-family affordable housing development c��d Ju�t 't 4, �41, nith a balance of $7,659,437 is due from the Palm Desert DerdoPme�t Cv�rp�nyr. �e ban is secured by a Deed of Trust, with assignment to proper-�r,renl a�i i�duiec e n tie Fbusng development iocated in Palm Desert. Interest is mmed ail d�an ru�ll� at a rate of 1`Yo per annum from the date on which the final cerlifcate �f �tupa�ty i� isc�d. Prncipal on the loan is based on the applicable age-�cys peicert�� of �csif�,e nel cash flow derived from the operations of the L�rdop rn�l 32 Paln Daserl R�I��,eb�ne�t Ar„�iqi Ilct�sta F�na� 5t3�n�rts(C�rti��l) Mde4 laan� IJ�t�slieca�alle �rdDue �arn Other Governmental Agencies(Continued) DueFranathe� Gare-nrne�til Ay�cies Di P.pri 1`I, iCQ�, tF�Ap e�cy e�fered into a loan agreement with The Regents of the Uiiveistyd C�ibmia,on b��lf oF its Riverside Campus, to loan various amounts over a �e�iodd in� not to ��eeL �n aggregate amount of$2,000,000. Proceeds of the loan are to le ased br caPit�l anPr�vements at the University's Riverside Campus. The o�t�a�Eirg princPaf b�lan�e and irrterest on the note is due in five annual payments begnoing m a futurE dote r� to be determined. As of June 30, 2007, the amount o�t�aidirgoi n� ba-,�as SZpoq000. Nate5 Ftite�f�rtlF�aeividQ Payifieanl rransfers f hec�n p�si tbi af n�f u�l lalan�s as of J une 30, 2007, is as follows: h�rfuid lrarsfers Transfers To S��I Capital leieiue PrajecLs L.>v�aid n�r� Other Uarrt I-in,isn' Brnrxirg Capilal Projed Capital Project Govemrrental Fbiai� Aii-iriQ A�.hvity Area 1 Area 2 Funds Total T�rsfrsFr�n Lorvartl Mdeah I r�ar�e F-puirg $ - S 1 1�0,101 � 42�,496 S 484,407 $ - $ - $ 16,275,606 Fbta i�A�hQit� - 1,OQ�,101 - - - - 1,000,000 DiblSatioe P/A 1 1.7T�S5 • I?�579,342 8,492.524 - - 30,850,921 Dib1Sa'�ioe P;A 2 !.41 g4�1 • 32�,6.`� - 1,789,799 - 8,496.879 Dd�tSe-�ce P/A 4 I.�7,385 • '1�.129 - - 418,495 4,932,009 DbtSr�ceFnaid�g A�FiQir 41.�ZT • - 4p.139,104 51,163,158 31,725,430 172,028,119 C}�it-►IPnj�ttf P./A 1 B 1,1 t3 • - - - - 231,113 C;��i�IPn�e�� P/A 2 - • - 274,022 - - 274,022 Ohe GJ�err�Er�l 71�03 l'14,971 242,583 - 19,717 1,689,883 io91s $ F�1,��W7 � 12�5�.171 $ i26ffi,605 S 49,632,640 $ 52,952,957 S 32,163,642 $ 235,778,552 � � Palm Desert Redevelopment Agency Notes to Financial Statements(Continued) Note 5: Interfund Receivable, Payable and Transfers(Continued) Transfers are used to: 1. move receipts restricted to debt service from the funds collecting the receipts to the debt service funds as debt service payments become due, 2. transfer 20% of tax increments received by RDA Debt Service Funds to the Low and Moderate Income Housing Special Revenue Fund, 3. transfer allocation of administrative expenses, and 4. transfer revenues to provide for capital projects. Note 6: Capital Assets A summary of changes in capital assets for the year ended June 30, 2007, is as follows: Bafance at Adjustments/ Deletions/ Balance at Primary Government: July 1,2006 Additions Transfers June 30,2007 Capital assets,not being depreciated Land S 50,677,284 $ 26,861,592 $ 375,715 � 77,163,161 Construction-in-progress 26,648,949 23,242,465 10,218,506 39,672,908 Total Capital Assets Not Being Depreciated 77,326,233 50,104,057 10,594,221 116,836,069 Capital assets,being depreciated: Buildings 64,663,641 2,204,744 1,029,477 65,838,908 Improvements other than buildings 7,232,558 - - 7,232,558 Machinery and equipment 144,253 120,307 591 263,969 Total Capital Assets Being Depreciated 72,040,452 2,325,051 1,030,068 73,335,435 Less accumulated depreciation for: Buildings (21,268,696) (1,557,708) 284,287 (22,542,117) Improvements other than buildings (2,357,383) (361,628) - (2,719,011) Machinery and equipment (111,754) (20,832) 325 (132,261) Total Accumulated Depreciation (23.737,833) (1,940,168) 284,612 (25,393,389) Net Capital Assets Being Depreciated 48,302,619 384,883 745,456 47,942,046 Net Capital Assets Governmental Activities $ 125,628,852 $ 50,488,940 $ 11,339,677 $ 164,778,115 Depreciation expense of $1,940,168 is reported with general administration expense in the Statement of Activities. 34 Palm Desert Redevelopment Agency Notes to Financial Statements (Continued) Note 7: Amounts Due Under Pass-Through Agreements Property taxes related to the incremental increase in assessed values after the adoption of the Redevelopment Plan are, except where otherwise provided by specific agreement, allocated to the Agency. The Agency has entered into various pass-through agreements with other agencies to ailocate its tax increment revenue. At June 30, 2007, the Agency has an obligation of$39,963,660 to other agencies and entities related to specific pass-through agreements as follows: Balance at Balance at Entity July 1,2006 Additions Payments June 30,2007 Riverside County- Capital Improvement $ 16,782,118 ; $ 15,126,564 $ 17,321,383 $ 14,587,299 Riverside Counry-Schools 662,312 733,097 662,311 733,098 Riverside County-Library 3,872,795 ' 1,811,887 5,684,682 Riverside County-Fire 2,767,317 2,990,357 2,767,317 2,990,357 Coachella Valley Mosquito Abatement District 538,456 596,686 538,456 596,686 Coachella Valley Water District 5,303,147 1,382,674 36,571 6,649,250 Dese�t Gommunity College District 1,134,708 * 1,263,533 1,134,708 1,263,533 Desert Sands Un'rfied School District 4,935,073 "' 5,584,906 5,109,897 5,410,082 Coachella Valley Recreation and Park District 427,435 467,479 427,435 467,479 Coachella Valley Resources District 4,133 4,474 4,132 4,475 Palm Springs Unified School District 187,429 270.470 187,428 270,471 County Juvenile Heaith District 556,727 1,350,905 1,180,618 727,014 Other Deposits 6i0,829 173,136 204,731 579,234 $ 37,782,479 $ 31,756,168 � 29,574,987 $ 39,963,660 'The Redevelopment Agency has used bond proceeds for the construction of capital improvements, which benefit these entities. These entities have agreements with the Redevelopment Agency, which wili allow it to use a portion of these amounts to offset debt service costs. Note 8: Long-Term Liabilities A description of long-term liabilities outstanding (excluding defeased debt) of the Agency as of June 30, 2007, follows: a. Tax Allocatlon Bonds Tax Allocation bonds 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. 35 Palm Desert Redevelopment Agency Notes to Financial Statements (Continued) Note 8: Long-Term Liabilities(Continued) 1995 Series Tax Allocation Revenue Bonds (Proiect Area No. 2) In June 1995, the Palm Desert Financing Authority issued $4,090,000 of Tax Allocation Bonds (Project Area No. 2) Series 1995. The Palm Desert Financing Authority loaned the bond proceeds to the Palm Desert Redevelopment Agency to fund various redevelopment capital projects of the Agency in Project Area No. 2. Interest rates on the bonds vary from 4.40% to 5.95% per annum payable semi-annually on February 1 and August 1 with principaf maturing annually on August 1. In July 2006 the remaining outstanding balance was advance refunded by the issuance of Project Area No. 2 Tax Allocation Refunding Revenue Bonds 2006 Series A. See Note 10 for more information. 1995 Series A-Tax Allocation Revenue Refundinq Bonds In August 1995, the Palm Desert Financing Authority issued $6,305,000 in Tax Allocation Revenue Refunding Bonds 1995 Series A. The proceeds from the bonds were loaned to the Palm Desert Redevelopment Agency to provide funds to refund in advance $6,430,000 of the 1988 Tax Allocation Bonds. Interest rates on the bonds vary from 3.80% to 5.55% with interest payable semi-annually on March 1 and September 1, with principa!maturing annually on September 1. 1997 Series Tax Allocation Refunding Revenue Bonds On July 24, 1997, the Palm Desert Financing Authority issued $71,955,000 in Tax Allocation Refunding Revenue Bonds (Project Area No. 1, as Amended) 1997 Series. The proceeds from the bonds were loaned to the Palm Desert Redevelopment Agency to provide funds to refund in advance a portion of the 1992 Series A Tax Allocation Revenue Bonds. Interest rates on the bonds vary from 4.100% to 5.625% with interest payable semi-annually on April 1 and October 1 with principal maturing annually on April 1. In July 2006 $23,595,000 of the outstanding balance was advance refunded by the issuance of Tax Allocation Refunding Revenue Bonds (Project Area No. 1, as Amended) 2006 Series B (Taxable) and in January 2007 $31,855,000 was advance refunded by the issuance of Tax Allocation Refunding Revenue Bonds (Project Area No. 1, as amended)2007 Series A. The total advance refunded amount was $55,450,000. As of June 30, 2Q07, all these bonds are redeemed or defeased. See Note 10 for more information. 1998 Series Tax Allocation (HousinQ Set-Aside) Revenue Bonds In January 1998, the Palm Desert Financing Authority issued $48,760,000 in Tax Allocation (Housing Set-Aside) Revenue Bonds. The proceeds from the bonds were loaned to the Palm Desert Redevelopment Agency to finance the acquisition of seven apartment complexes consisting of 725 rental units from the Housing Authority of the County of Riverside. Interest rates on the bonds vary from 4.0% to 5.1% per annum payable semi-ann�ally on Apri! 1 and October 1 with principa! maturing annually on October 1. In February 2007 S38,740,000 of the outstanding balance was advance refunded by the issuance of Tax Allocation (Housing Set-Aside) Refunding Revenue Bonds Series 2007. See Note 10 for more information. 36 Paim Desert Redevelopment Agency Notes to Financial Statements(Continued) Note 8: Long-Term Liabilities(Continued) 1998 Series Tax Allocation Revenue Bonds(Proiect 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) Series 1998. The proceeds from the bonds were loaned to the Palm Desert Redevelopment Agency to fund various redevelopment capital projects of the Agency 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. See Note 10 for more information. 2001 Series Tax Allocation Revenue Bonds (Project Area No. 4) In November 2001, the Palm Desert Financing Authority issued $15,695,000 of Tax Allocation Revenue Bonds (Project Area No. 4) Series 2001. The proceeds from the bonds were loaned to the Palm Desert Redevelopment Agency to fund various redevelopment capital projects of the Agency in Project Area No. 4. Interest rates on the bonds vary from 3.5% to 4.9% per annum payable semi-annuaNy on April 1 and October 1, with principal maturing annually on October 1. 2002 Series A Tax Allocation Refundinq Revenue Bonds (Proiect Area No. 1 as Amended In March 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 Palm Desert Redevelopment Agency. A portion of the proceeds of the loan was used to prepay the prior loan, which effected 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. 4. The bonds consist of serial bonds of $10,905,000 at 5.00°/a due April 1, 2025, and $11,165,000 in 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. 2002 Series A Tax Allocation Refundinq Revenue Bonds (Proiect Area No. 2) In July 2002, the Palm Desert Financing Authority issued $17,310,000 of Tax Allocation Refunding Revenue Bonds (Project Area No. 2). The Palm Desert Financing Authority loaned the bond proceeds to the Palm Qesert Redevelopment Agency 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. Principal payments wiil be made annually beginning August 1, 2003. Series 2002 Tax Allocation (Housinq Set-Aside) Revenue Bonds In August 2002, the Palm Desert Financing Authority issued $12,100,000 of Tax Allocation (Housing Set-Aside) Revenue Bonds Series 2002. The Palm Desert Financing Authority loaned the bond proceeds to the Palm Desert Redevelopment Agency 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 begin October 1, 2003. The $5,545,000 term bonds bear an interest rate of 5.0% per annum and mature October 1, 2031. 37 Palm Desert Redevelopment Agency Notes to Financial Statements(Continued) Note 8: Long-Term Liabilities(Continued) Series 2003 Tax Allocation Revenue Bonds (Proiect Area No. 2) In March 2003, the Palm Desert Financing Authority issued $15,745,000 of Tax A�location Revenue Bonds (Project Area No. 2) Series 2003. The Palm Desert Financing Authority loaned the bond proceeds to the Palm Desert Redevelopment Agency to fund various redevelopment capital projects of the Agency 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 Series 2003 Tax Allocation Revenue Bonds(Proiect Area No. 1� In July 2003, the Financing Authority issued �19,000,000 Tax Allocation Revenue Bonds (Project Area No. 1 as Amended) Series 2003. The proceeds of the bonds were disbursed to make a loan to the Redevelopment Agency. The Agency will use the proceeds of the loan to fund various redevelopment capital projects of the Agency 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 payabfe 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. Series 2003 Tax Allocation Revenue Bonds(Proiect Area No. 3) In July 2003, the Financing Authority issued Tax Allocation Revenue Bonds (Project Area No. 3) Series 2003 in the amount of $4,745,000. The proceeds of the bonds were disbursed to make a loan to the Redevelopment Agency. The Agency will use the proceeds of the loan 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. 2004 Series A Tax Allocation Refundinq Revenue Bonds (Proiect Area No. 1 as Amended In June 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 Palm Desert Redevelopment Agency 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. 38 P�!n C��atF�der el apirB�t Ag er�� t�b�� bFn�ncalg�a�en��Contru�c� Pb�B: in��lern li�t�lti�s(Carti�ue�d) Za� P.Ibc�iv-� Rere�ie Brnds (Prr�iect Area No. 1, as Amendedl 2006 Series A and Sei�B(�a��l�) 4n J...ily 6, 20D6, tYe Palm Ueserf Financing Authority issued $37,780,000 of Tax AI1��ti�� Re�ei� ��c� (Project Area No. 1, as Amended) 2006 Series A and ��.S4D,D00 � T�xAllecation Reiunding Revenue Bonds (Project Area No. 1, as Arne��l)21�Ser�t B �Taiable). rhe Palm Desert Financing Authority loaned the kz�id {rac��ft lo tle P�n Desert Redevelopment Agency. The proceeds of the Se6�Al�i vil heusedta assistthe Agency to fund various redevelopment capital �rqe�h ►✓il�noi aF le-�efi b P�ojectArea No. 1, as Amended, pay costs of issuance a�l p� Ihe prem i�n on a Reserve Fund surety bond. The proceeds of the Series B I�a� vrll le �sed b ieirrance the Agency's obligations incurred under a loan �ie�n�t e��iel nb in 1JBT, pay costs of issuance and pay the premium on a fie�e��,eFirdsirtt� danG. r�e Series A bonds consist of$26,415,000 Serial Bonds �nitt n��t r��ra�y iig fion 4.7�%to 5.25% payable semiannually on October 1 a�l P.pri I . Bard rnataetes begin April 1, 2017, and continue annually through �JO. rtmberda n Ihe amaunt of$11,365,000 carry an interest rate of 5.00% and n�ueApnl'1, 2�322 �The Series B bonds consist of $13,220,000 Serial Bonds with iateresl ra�s raag�g Irarr S_S6°/a to 5.77% payable semiannually on October 1 and �pil '1. B�nd n�uitiei begn April 1, 2007, and continue annually through 2012. ?ern ho�c� ntheariocntaF j 11,320,000 carry art interest rate of 5.82% and mature �pi I 1 ,?�16. ?aa Abc�ian R�u�liecq REvcrue Bonds {Proiect Area No. 1, as amended) 2007 �i� A 4n.lam�ary �, �17, Fie P�Irt� Desert Financing Authority issued $32,600,000 Tax Alacatbi Refindi�g Heve�ue Bonds (Project Area No. 1, as amended) 2007 Series A lt�e Paln Deae-t Firaedng Authority loaned the bond proceeds to the Palm Detet Relc��lapment Age�cy. The proceeds of the 2007 Loan will be used to r�fnan�e a En�ti�nd rie auls4nding obligations of the Redevelopment Agency, fund varrro�s iedevelaRriertt capital projects within the Palm Desert Redevelopment /�ptr�y Prvjed Aiet N�. 1, as amended, and pay the costs associated with the issiaiced t�e tnE�. TI�Series Abonds consist of$32,600,000 Serial Bonds with i�rte-es1 rates rangn� t-o� 3.50% t�5.00% payable semiannually on October 1 and .�il 1 . Brnd matu-ii�begnApril 1, 2008 and continue annually through 2018. f�cieet Area M a 2 l� W ocot�n Refundin9 Revenue Bonds 2006 Series A, Tax �Iloc�t�n Raverue Caqt�l Apureciation Bonds 2006 Series B. Revenue Bonds 2006 �net C a�d Su bo�cintte T-�x Albcation Revenue Capital Aapreciation Bonds 2006 �nec D �Jil� 25, 2UD6, It-ie P�Im Desert Financing Authority issued its Project Area No. 2, �1,3�11,Im Ta� /�lbcaim F�efunding Revenue Bonds 2006 Series A, $1,567,118 �'a� Albcaim F�ve�e�C�piial Appreciation Bonds 2006 Series B, $7,775,000 Tax .WIUCiLDA F�venue Bmis 2006 Series C and $16,936,095 Subordinate Tax �Ilac�tbn Re�enue C:apital,Qppreciation Bonds 2006 Series D. The Palm Desert F�a r�n g Aut han t� be red Ihe bond proceeds to the Palm Desert Redevelopment �ger�y f�Roceeds af lhe Senes A, B and C Bonds will be used to make three I��s t� �iriance he Agency�s obfigations incurred under a loan agreement entered irto in 1 996, fiRivirbis rsdevelopment capital projects within or of benefit to its Rqect.4�a f�b. 2 Resene f�nd surety and pay costs of issuance of the bonds. The Ape-icy Ni Lse lhe proceeds of the Series D Bonds to fund various rede�ebprnent capita!piojects within or of benefit to the Project Area, fund a debt stnic�resenefird andpay o�stof issuance of the bonds. 39 Palm Desert Redevelopment Agency Notes to Financial Statements (Continued) Note 8: �ong-Term Liabilities(Contirtued) The Series A bonds consist of $16,250,000 Serial Bonds with interest rates ranging from 4.00°/a 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 consist of $3,950,000 Serial Bonds with interest rates ranging from 3.90% to 4.90% payable semiannually on August 1 and February 1. Bond maturities begin August 1, 2010, and continue annually through 2026. Term bonds in the amount of $1,910,000 carry an interest rate of 4.90% and mature August 1, 2031. Term bonds in the amount of $1,915,000 carry an interest rate of 5.00% and mature August 1, 2035. 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 begin 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 30,2007, is$936,067. Prolect Area No. 3 Tax Allocation Revenue Bonds 2006 Series A. Tax Allocation Revenue Capital Appreciation Bonds 2006 Series 6 and Subordinate Tax Allocation Revenue Capital Aporeciation 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 AAocation 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 Palm Desert Redevelopment Agency. The proceeds of the Series A and B Bonds will be used to make two loans 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 Agency will loan the proceeds of the Series C Bonds 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. 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 begin 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, 2007, is $172,082. Tax Allocation Refundinq Revenue Bonds (Proiect Area No. 4) 2006 Series A and Tax Allocation Revenue Capital Appreciation Bonds (Proiect Area No.4)Series B On July 25, 2006, the Palm Desert Financing Authoriry issued $14,610,000 of Tax Allocation Refunding Revenue Bonds (Project Area No. 4) 2006 Series A and �4,663,089 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 Palm Desert Redevelopment Agency. 40 P�lin D�s e-t Fi�1 e✓e t�Frrie�tAg�nc� fV��s bFrianc�al Stat�ne-�Is(Cmin�.ed) I�bi�6: Lan�-Te-m Li�4iHtes (C►ntn�ed) TYe pioceeds af the Seiies A and B Bonds will be used to make two loans to eSnance a po�ian aF the autstanding obligations of the Redevelopment Agency and er a I�n agra�r�ent d�ted March 1, 1998, fund various redevelopment capital pr�jec�wtYinQ ofberefit bits ProjectArea No. 3, purchase a Reserve Fund surety pafv/aid �� i�e e�t�oi ics.iance of the bonds. The Series A bonds consist of �8,�55,d�p Seral Bondsv�itl inlerest rates ranging from 4,40% to 5.00% payable senairuallr on Odoberl a�d April 1. Bond rnaturities begin October 1, 2008, and contn�e a�icaFytfraugh 1026. Term bonds in the amount of$2,200,000 carry an in te r�� ale � 5.D 0% �rzi rnature October 1,2029. Term bonds in the amount of �,25�ooe car� an iitere� a{eoF 5.00% and mature October 1, 2034. The Series B dmiscans'st� (4,652,O�Capital Appreciation Bonds with a yield ranging from 4.14'/o to 55i�,4. Barid rnalurities begin October 1, 2009 and continue annually fi�ugh 2a34. Each y�i fie outstanding balance is increased for the accretion of intere� aas�dat�l vtitl lhe bonds. The accreted interest at June 30, 2007, is 923 5,911. laK Albcalim(Ha.�sirr�Set•/�side)Refundinq Revenue Bonds Series 2007 On FeDnlary 1, 20CP, tle PaM Desert Financing Authority issued $86,155,000 Tax All�cafrn (Housir��Asde) Refunding Revenue Bonds Series 2007. The Palm Dc�ert Fira��g P.�thori� baned the proceeds to the Palm Desert Redevelopment A�nq�_ lhe pmceedsoi the 20D7 Loan will be used to finance the development of I�u a�d maderate inc�ne lousing by the Redevelopment Agency, refinance a portion cf tFt�outstard'n9 �bligations of the Redevelopment Agency , purchase a d�t seniice suiely t�id fir deposit in the Reserve Fund, and pay certain costs assc�iat�d vif� the 's�.aar�e oi lhe bonds. The Series 2007 bonds consist of $86,1 �p10 Seiial Bards vih interest rates ranging from 4.00% to 5.00% payable �n�eriva117 on Odobe-1 a�d April 1. Bond maturities begin October 1, 2007 and w�tn uean nua li�IF�ou gh2DZ7. la AcL�rz�sf�nCat� lF�e Ciyof Palrr D�seri fa� n��advances to the Agency to finance capital projects in tle felb�riigar��ris: P�ctPdea#1 $10,011,857, Project Area #2 $20,991,060, and Praj�t Are�#+(i $1,1�,563, br a i�tal of$32,785,480. These advances do not have a fic edrepa y��t s d�e d..��. c naes P,�a►1� lhe Ager�y ente-ed 'nb a ca�perati�n agreement with the County of Riverside (t-�e Cau�t�)oi Decernbe� 15, 1967, regarding the adoption of the Agency's Project Area ►Vo. 2 T"heagreerrents�� h�ttheAgency was to retain 50% of the County's share of toxinc�enert.Thie vasba�l on the Caunty's share of tax increment being what would he �lacated b ile Caunt� in he absence of a redevelopment project area being ai i pled. -fis ayreeir�ent ��IedfortheApe�cy to retain 50% of the County's share until the gross ina�r�ert iead�ed $3�IqC04. The agreement further states that when gross increment reacheG �1q�d,aOD ttai he Ayency would repay the 50% of the retained County's share aF ncren�tin equ� pa,rmerYsovera 10-year period. �� ro� irxrerne�l reaclecftF�$3,5U0,000 limit in fiscal year 1991-1992. The Agency re�hed ff-� $I Qm1,1�lini n fitcal year 2002-2003. The total amount owed to the Co�rty � J u�e 30, 21(5, v� $136242_ Annual payments on the note are $122,707. �e edeisr�ni-i�►��est beanrg. 4} Palm Desert Redevelopment Agency Notes to Financial Statements(Continued) Note 8: Long-Term Liabilities(Continued) Future debf service payments are as follows: Year Ending June 30, Principal Interest Total 2008 $ 122,707 S - $ 122,707 2009 122,707 - 122,707 2010 122,707 - 122,707 2011 122,707 - 122,707 2012 122,707 - 122,707 $ 613,535 $ - S 613,535 d. Schedule of Changes The following is a schedule of changes in long-term liabilities of the Agency for the fiscai year ended June 30, 2007: Balance Repayments/ Balance DueWithin July 1.2006 Defeased Additions Reductions June 30,2007 One Year Project Area No 1 Pdvances from City $ 10,011,857 S - $ - $ - $ 10,011,857 5 - 2002 TARRBs,522.070,000 22,070,000 - - - 22.070,000 - 1997 TARRBs,$71,955,000 57,515,000 55,450,000 - 2,065,000 - - 2003A TAfZBs,$19,000,000 19,000,000 - - - 19,000,000 - 2004ATARRBs.$24,945,000 23,595,000 - - 940,000 22,655,000 850,000 2006 A&B TARRBs,$62,320,000 - - 62,320,000 2,215,000 60,105,000 1,965,000 2007ATARR85,532,600,000 - - 32.600,000 - 32,600.000 2,130.000 Total $ 132,191,857 $ 55,450,000 $ 94,920,000 $ 5,220,000 $ 166,441,857 $ 4,945,000 Project Area No.2 Pdvances from Ciry $ 20,991,060 $ - $ - $ - $ 20,991,060 $ - Counry Note Payable 736,242 - - 122,707 813,535 122,707 1995 TARBs,$4,090,000 3,870,000 3,870,000 - - - - 2002ATARRBS,$17,310,000 15,310,000 - - 630,000 14,680,000 650,000 2003 TARBs,$15,745,000 15,745,000 - - - 15,745,000 - 2006 A-D TARBS,567,618,213 - - 68,554,280 - 68,554,280 907,438 Total $ 56,652,302 S 3,870,000 $ 68,554,280 $ 752,707 $ 120,583,875 $ 1,680,145 Proi�t Area No.3 Advances from City S 1,782,563 $ - $ - $ - S 1.782.563 $ - 2003 TARBs,$4,745,000 4,410,000 - - 95.000 4,315,000 95,000 2006 A-C TABs,515,059,528 - - 15,231,608 40,000 15,191,608 - Total � 6,192,563 $ - $ 15.231,608 $ 135,000 $ 21,289,171 $ 95,000 Proiect Area No.4 1998 TARBs.$11,020,000 $ 10,140.000 $ 1,785,000 $ - $ - S 8,355.000 $ - 2001 TARBs,$15,695,000 15,065,000 - - 270,000 14,795,000 285,Q00 2006ATAR85,519,273,089 - - 19,509,006 - 19,509,008 - Total � 25,205,000 $ 1,785,000 $ 19,509,006 $ 270,000 $ 42,659,006 $ 285,000 Combined Low and Moderate Housinq 1998 TARBs,548,760,000 $ 45,080,000 $ 38,740,000 $ - $ 615,000 S 5.725,000 $ 655,000 2002TARBs,$17,310,000 11,380,000 - - 250,000 11,130,000 255,000 1995 Series TARRBs,$6,305,000 1,820,000 - - 585,000 1,235,000 600,000 2007TAR85,586,155,000 - - 86,155,000 - 86,155,000 2,185,000 Tolal $ 58,280,000 $ 38,740,000 $ 86.155,000 $ 1,450,000 $ 104,245.000 $ 3,695,000 Total-All Project Areas City Loans-Principal $ 32.785,480 $ - $ - $ - $ 32,785,480 $ - Loans- Other Governments 736,242 - - 122,707 613,535 122,707 Bonds Payable 245.000,000 99,845.000 284,369,894 7,705,000 421,819,894 10,577,438 Subtotal 278,521,722 99,845,000 284,369,894 7,827,707 455,218,909 10,700,145 Pdd' Unamort¢ed bond premium 819,307 - 7,785,375 278,036 8,328,646 - Less: Unamortized gain/loss on defeasance - - 1,811,501 82,536 1,728,965 - Totat S 279,341,029 S 99,845,000 S 290.343,788 S 8.023,207 S 461.818,590 E 10,700,145 42 Palm Desert Redevelopment Agency Notes to Financial Statements(Continued) Note 8: Long-Term Liabilities (Continued) e. The following schedule illustrates the debt service requirements to maturity for bonds outstanding as of June 30, 2007. The debt service requirements schedules for the 200fi issues of project areas 2,3, and 4 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 is the accreted value to date. The amount in the repayment schedule is the fully accounted value (future value) of the bonds. Area No.1-TaxAllocation Refunding Bonds,2002 Series A- Prea No.1-TaxAllocation Reeenue Area No.t-TaxAllocation Refunding $22.07M Bonds,Series 2003-$19M Bonds,2004 Series A-$24.945M Principai Interest Principal Interest Principal Interest 2007-2008 $ - $ 1,114,664 5 - $ 950,001 $ 850,000 3 1,059,813 2008-2009 - 1,114,665 • 950,001 1,030,000 1,025,813 2009-2010 - 1,114,665 - 950,001 945,000 974,313 2010-2011 - 1,114,665 - 950,001 1,130,000 927,063 2011-2012 - 1,114,665 - 950,001 1,050,000 878,213 2013-2017 - 5,5)3,324 - 4,750,005 6,215,000 3,629,138 2018-2022 - 5,573,326 - 4,750,005 7,715,000 2,087,675 2023-2027 15,040,000 4,141,059 7,050,000 4,578,005 3,720,000 424,750 2028-2032 7,030,000 728,790 11,950,000 1,214,501 - - 2033-2037 - - - - - - Totais S 22,070,000 S 21,589,823 $ 19,000,000 S 20,042,521 $ 22,655,000 3 11,004,778 Area No.t-TaxAliocation Prea No.1-TaxPllocaGon Bonds, Refunding Bonds,2007 Series A- Area No.2-TaxAllocation Refunding 20Q6 Series Aand 8-$62.320M S32.6M Bonds,2002 Series A-$17.31 M Principal Interest Principal Interest Principal Interest 2007-2008 $ 1,965,000 $ 3,203,349 $ 2,130,000 S �,844,154 $ 650,000 S 653,078 2008-2009 2,075,000 3,092.327 2,410,000 1,416,826 675,000 631,853 2009-2010 2,195,000 2,974,259 2,640,000 1,320,425 695,000 607,868 2010-2011 2,320,000 2,848,266 2,625,000 1,201,625 720,000 581,498 2011-2012 2,450,000 2,714,634 2,870,000 1,083,500 760,000 548,638 2013-2017 12,320,000 11,265,845 16,245,000 3,375,003 4,365,000 2,171,020 2018-2022 22,720,000 7,481,513 3,680,000 184,001 5,535,000 1,030,196 2023-2027 13,235,000 1,551,538 - - 1,280,000 32,000 2028-2032 825,000 79,670 - - - - 2033-2037 - - - - . . Totals $ 60,105,000 $ 35,211,401 $ 32,600,000 $ 10,365,534 3 14,680,000 $ 6,256,151 �� Area No.2-TaxAllocation Bonds, Area No.2-TaxAJlocation Re�.anue 2006 Series Athrough D- Area No.3-TaxAllocaUon Revenue Bonds,Series 2003-$15.745M 567.618M Bonds,Series 2003-$4.745M Principal Interest Princ�pal Interest Principal Interest 2007-2008 S - $ 769,006 $ 907,438 $ 2,404,240 $ 95,000 $ 198,748 2008-2009 - 769,006 1,221,594 2,463,783 100,000 195,898 2009-2010 - 769,006 1,777,789 2,595,139 100,000 193,048 2010-2011 - 769,006 1,547,001 2,589,956 105,�00 189,848 2011-2012 - 769,006 1,647,818 2,561,720 110,d00 186,225 2013-2017 - 3,845,030 8,355,11 1 12,861,088 810,000 865,310 2018-2022 - 3,845,030 8,328,548 13,033,747 755,000 726,033 2023-2027 4,270,000 3,494,421 11,792,431 14,650,037 950,000 532,193 2028-2032 7,775,000 1,935,625 11,933,707 11,401,991 1,210,000 263,681 2033-2037 3,700,000 187,250 20,106,776 8,385,929 280,000 14,350 Totals $ 15,745,000 S 17,152,386 $ 67,618,213 $ 72,947,630 S 4,315,000 L 3,365,334 43 ��n D�se rt R�ed�vebP m er-i A ge�cy latesta fi�a�cial Sfaienenta (C►ntn�ed) Iate 8: L�r�TrrtnU�lites�Canlrucd) 2 CD6SZ re sAF�o ig hC- FVe af�b.4-TaxAllocaUon Bonds, Area No.4-TaxAllocation Bonds, $15D�fV �riee 1998-$11.02M Series2001 -$15.695M Ri�i�al Ytaett Rir'ici�al Interest Principal Interest ip 7- aDli3 � • $ lti�.TT S S - S 429,590 $ 285,000 $ 673,013 1018- X�19 71,I'11 !61,�J - 429.590 310,000 662,313 t q 9- X�10 1�.101 !7!,i7 S - 429,589 305,000 651,251 !l�l O- I011 1�,171 !71,2» I 30,OOD 426,665 320,000 639,910 101 1- X)12 1�,l31 i6t,141 135,OOD 420,635 325,000 628,012 t O(3- K7 f7 '1,�B,131 2,IOt.FJ� } ,l2D,OOD 1,949,773 1,875,000 2,915,904 IOI 8- lDI2 1 6�,!�I 3,l61.&i 1 2,185,OOD 1,449,975 2,360,000 2,443,182 tOt3- lOr7 19�,131 3,191,64� 2,f7D,000 769,340 2,915,000 1,826,259 t 02 8- ID� 21�,121 4,151,�31 1 ,1�5,000 74,490 6,100,000 867,600 lOf3- lOT7 36�,1�1 2.19l.S31 - - - - lc7l8- 10�2 3b�,K71 16t.75U - - - - Tit2s � 15D�,f2f � D,11t,�1� S B,155,QOD S 6,379,647 $ 14,795,000 S 11,307,444 �-� � � � Rei Ilo.4• Tx xAlb�tb nE3�nl s, I�o�a i�gSet-Pside Re�enue Housing Set-Aside Re�enue Bonds, IOIF�S�ids A til B- �91.713N t�ct,Series 1998-348.76M Series 2002-$12.1M R-ici�al Yte�t P1i�i�al Interest Principal Interest 2 m 7-1018 $ - $ 1�31,�4 5 S ISS,OOD S 262,281 $ 255,000 $ 508,449 2 m8-1019 2�,101 191,411 1£35.000 233,806 265,000 500,573 2m9-1010 4�i,1531 Iti�,94i 1 .1�D,OOD 184,500 275,000 491,454 2 01 0-!OI'1 4�,ICJI IE�I,�1 1 ,16D.000 113,250 285,000 481,298 2011--1012 554,131 1.5i,@12 1 ,l35,OOD 38,375 295.000 470,201 2 01 3-IUI7 2S�,131 2 J71.9�7 - - 1,660,000 2.180,069 2O18-I(]i2 '14�,151 2,1't1,811 - - 2,075,000 1,755,359 2@3-1017 372�,141 2,131.�i1 - - 2,635,000 1,188638 2�8-1012 4a �,IE�I 4,141,ffi 1 - - 3,385,000 439,875 283-1017 5�4Q,151 6J4f,119 - - - - To tll s .S 1�:3z 73,I£31 S Z3,121,�7 S 5.125.000 $ 832,212 5 1 1,'I 30,000 S 7,995,916 - � Hausing Sel-Aside Retunding Nc�sngS�t�sCeF3�,tr�eBa��, F��en�e Bonds,Series 2007- t�S.Sir its A•$1.�9,/I 586.155M TOt21 Prtidpd Ita�i Pri�cpal Interest Principal Interest 1017• �B $ 101,m0 I � .J�J� S 1,185,000 $ 4,564,307 $ 10,577,438 $ 19,950,006 IOIS• �� I`3f,ma Y,�LI 2,860,OD0 3,861,963 12,508,606 18,628,245 1019• �A - 9,�S,OOU 3,736,750 13,893,386 18,252,391 1010• �11 - 3,�35,OD0 3,606,438 14,372,872 17,672,350 1011• �12 - 7,?B5,OD0 3,478,438 15,195,985 17,060,016 t013� �17 - 21,615,000 13,974,538 84.980,882 75,158,787 1018• �71 - • 26,355,OD0 6,670,156 83,874,820 57,503,857 1013• �� - 15,Z40,000 2.461,281 86.755,T10 42,477,916 1018• �� - • 3,475,000 73,844 61,488,797 25,979,639 10l3• �3 - 33,167,932 17,228,785 T�tAs $ 1 ,1:3f,�0 1 �.111 S E38,�55,OD0 $ 42,427,715 $ 420,475,828 $ 310,380,742 44 Palm Desert Redevelopment Agency Notes to Financial Statements(Continued) Note 9: Bond Reserve Requirements At June 30, 2007, the reserve balance requirements and actual balances were as follows: Issue Requirement Actual 1995 Refunding Tax Allocation Bonds $ 123,500 $ 641,207 These actual amounts are included in the Fund Balance reserved or designated for Debt Service (see Note 11). Note 10: Defeased Obligations In July 2006, the Agency issued $24,540,000 Tax Allocation Refunding Revenue Bonds (Project Area No. 1, as amended) 2006 Series B (Taxable) and in January 2007, the Agency issued $32,600,000 Tax Allocation Refunding Revenue Bonds (Project Area No. 1, as amended) 2007 Series A to advance refund $55,450,000 of outstanding Tax Allocation Revenue Bonds 1997 Series. The net proceeds of$56,098,000 (after paying certain issuance costs and depositing moneys in the project fund) were used to purchase U.S. government securities. Those securities were deposited in an irrevocable trust with an escrow agent to provide for al! future debt service payments on the 1997 bonds. As a result, $55,450,000 of the 1997 bonds are considered to be defeased and the liability for these bonds has been removed from the statement of net assets. The Agency advance refunded the 1997 bonds to reduce its total debt service payments over the next 16 years by $12,140,000 and to obtain an economic gain (difference between the present values of the debt service payments on the old and new debt)of$482,757. In July 2006, the Agency issued $41,340,000 Tax Allocation Refunding Revenue Bonds (Project Area No. 2) 2006 Series A. A portion of the proceeds were used to advance refund $3,870,000 of outstanding Tax Allocation Revenue 8or�ds 1995 Series A. The net proceeds of$4,021,993 (after paying certain issuance costs and depositing moneys in the project fund) were used fo purchase U.S. government securities. Those securities were deposited in an irrevocable trust with an escrow agent to provide for all future debt service payments on the 1995 bonds. As a result, $3,870,000 of the 1995 bonds are considered to be defeased and the liability for these bonds has been removed from the statement of net assets. 7he Agency advance refunded the 1995 bonds to reduce its total debt service payments over the next 20 years by$232,698 and to obtain an economic gain (difference between the present values of the debt service payments on the old and new debt)of$232,274. In July 2006, the Agency issued $14,610,000 Tax Allocation Refunding Revenue Bonds (Project Area No. 4) 2006 Series A. A portion of the proceeds were used to advance refund $1,785,000 of outstanding Tax Allocation Revenue Bonds 1998 Series. The net proceeds of �1,829,693 (after paying certain issuance costs and depositing moneys in the project fund) were used to purchase U.S. government securities. Those securities were deposited in an irrevocable trust with an escrow agent to provide for all future debt service payments on the 1998 bonds. As a result, $1,785,000 of the 1998 bonds are considered to be defeased and the liability for these bonds has been removed from the statement of net assets. The Agency advanced refunded the 1998 bonds to reduce its total debt service payments over the next 6 years by $36,508 and to obtain an economic loss (difference between the present values of the debt service payments on the old and new debt) of$28,088. In February 2007, the Agency issued $86,155,000 Tax Allocation (Housing Set-Aside) Refunding Revenue Bonds Series 2007. A portion of the proceeds were used to advance refund $38,740,000 of outstanding Tax Allocation (Housing Set-Aside) Revenue Bonds 1998 Series. The net proceeds of$39,706,946 (after paying certain issuance costs and depositing moneys in the project fund)were used to purchase U.S. government securities. 45 Palrt� D�sa�tR�der�q�n�rt A�ency fJ�t�st► Finar�islS3er�itc �b�ti��ed� IJ�te IQ D�leased 041i0atro�s(Cv-itia�l) Thas� sec�rifes nnr� d�astedinan irrevocable trust with an escrow agent to provide for all fctve c�ltser�i�paymerts mtft�'l998bonds. As a resuit, $38,74�,000 of the 1998 bonds a�c>rsila�edta 6ec��as�d and ttie liability for these bonds has been removed from the st��menl af net asstt�. �7ht Agencyadvanced refunded the 1998 bonds to reduce its total dekt �ervice �a,ime��o�er he n�ct2D years by $2,222,075 and to obtain an economic gain (�f�ei�b�tvee� Ihe pie�ent �ues of the debt service payments on the old and new det�)of$I �)4,S�Q H�tt 1't: F�serve a af F��i Be It nce s S1e6al Rtvei� Capital Project fuid Funds lrn aid Delt Sevice No�nte F�nd Other hia�rte !-buirg Fnaidng Projed Projed Govemmenta! Nosng �tf�rly A.itlaity Area 1 Area 2 Funds Total Lk��s�ni �tt�: e�i�alt� $ 7��.06 $ - 6 - $ - S - $ 2.000,000 $ 9.699,606 Ro�.A,i letl ir�.s�l� I'1T�.d�6 - - - - - 11,799,806 F��il itrr>iril�psls 3,�7 - - 589,716 - - 593,273 6arrbra��.s 55�.�4 i,�9p� - 4,904,584 812,785 19,462 18,099,137 C�rlrnirO ��rc�riRicis I3B71,Y12 195z� - 10,591,972 2,533,049 13,904,761 43,496,817 Fas��e tc�uienat • 9Dm - - - - 9,000 ':'�hl:3rrc,a • - �13�dD - - - 123,500 $ 1867f,�5 $ i4{3375 � '11350D $ 16,086,272 $ 3,345,834 $ 15,924,223 $ 83,821,139 R��nied fir l,��rs and lJ�tes Receirables - These reserves are set up to reflect the nar��rrert pa�t�i iecei✓�kles totl� hey will not be considered as current funds available. Re�niedf�-Pple�tr Hddfar Re�a�- rhis reserve for property held for resale has been set aa�toind'cate fiat t vil �d hecorsctered as currentfunds available. Re�nied i�r P r�m�d 1�m s a nd D et�si ts - These reserves are set up to reflect the narx�r2rt p�r1rn ol h� d�p��tt so thal they will not be considered as current funds a�alable. Resenitd i�r Ericu�b��s • f hese reserves represent the portion of purchase orders ava�l fa nilid� tle g�ds � serrices had not yet been received at June 30, 2007. Alt-nugb all��r�priatiars I�seal 7�r-end, even if encumbered, the City intends either to hm�rthecortr�dsin {rag�ss a- locancel thern. Encumbrances are rebudgeted on July 1, b y Boa M a d i ar�. ResENedfa- Carlirung A�c�lraions -Zhis reserve is for appropriations for capital projects F-ie t ar� ue ec�en ded �s � Ju ne 3 o, 2007, and are carried forward as continuing aq�ioPrafrns to leecpen�l n2C07-2008. Reserved fcr R�s-ve Aep ui r�rn e-il — Zhese reserves are set up for the maintenance requrtnei� la the bis-ig a��trnents, 46 F�Fn Oes er1 Fied�vr I�pnen!��ncr nt�lec �oFra�d� st�trme�ls(cv,6Ni.e�) I�ble�l : Resenesoi Fa.r�l 6�a�«(Crnfrued) Rc�ened f�r Debl SeNice • -Ihese reserves for Debt Service represent reserves accimibted ly the Agen�rthal are legally restricted to the payment of long-term debt prindpalaod iiter�sl a-nourtstl� mature nfutureyears. f�bte'tt: F�nl gala�ce a-�d N�tAcselsF�rtztement lhe k�e�innin0 fund haFance Yras bee� ncreased by $481,166 due to a prior year caPi�fe�t�n ardthe k�e�inni-np balance of net assets has decrease by $621,694 due to adj�stnarl aFc�lal ��els. f�bie�i: Ca�duitDeltmipim ,U13Seri�sA-$t2311,OOD Leaae RevenueBonds h Deaenle im1,thePalnOesgtFiriancing Authority (Authority} issued �22,310,000 in L��a Re�enue B�r�i�. -Tha Praceeds of the Bonds were used to: a) finance the con�r�dianol a County a�inafshdterand related facilfties iocated in the unincorporated area � T'laus�a�d Palrros, C�iinm's; b)finance construction of certain County medical cl ii ic faal iic�lo��e3 inNc�ca,Caiifomia; c)refund the Palm Desert Financing Authority L��F��enue�ncl� Ser'e� 1996; d� acquire a debt service reserve insurance policy; e)fu�l cap i�iztd iittrtsl an tle bonds; and f) pay costs of issuance of the bonds. The Avb�y Wil �ase si�� ie�tng to each project from the County of Riverside (County) pursua�t b a Ste Leace d� as of December 1, 2003, and will lease back to the Caiit� he Sies a�d Ue f�ifties pursuant to a Facilities Lease dated December 1, 10D3. Uir�rtleLBase,theCocrty�ri� payto theTrustee Base Rental Payments in the arrou rt eyua 1 ta 1h e ech edr l�d debt service of the Bonds. The Authority will assign its n_yhtta �eaeve rie 8�e Re�4!Payrnenls to the Trustee for the benefit of the owners of the bo��.�lt�� debtserricern Ihe bonds isto be paid solely from lease payments made 4ytt�Cbunly. �Fie Autbiitr I�no �bligation to make the debt service payments in the evert Fi�ttheC�u�yisr�table brrake the required base rental payments. As of June 30, �17, h� aulsta�dng amauntv�es 520,940,000. f�b�11: l�s.irance �e Ageno,iisc4�.eie1 arriertFeCtycf Palm Desert's insurance. For additional information, �� he Ciy't inancalsta�nerts r�� i: c«�,,;t��rt9 �11-�e Ag�ryf�as rariau� di�p��tpi and developrnent agreements and owner participation �ietn�is ��tsta-iliig f�ll liak�iifes incurred to date have been accrued in the financial ��c�r�ents Cbnsrucirn mn�lrnenls are reported as fund balances reserved for �curib ra nce s a�G a-e delaled 'n f�btr 1 1. 47 PALM DESERT REDEVEL�PMENT AGENCY Schedule 1 COMBINING BALANCE SHEET-OTHER GOVERNMENTAL FUNDS JUNE 30,2007 Debt Capital Service Projects Fund Funds Totals Assets: Cash and investments $ 4,270,319 $ 2,828,575 $ 7,098,894 Cash with fiscal agent-restricted - 43,124,767 43,124,767 Accounts receivable 37,607 - 37,607 Interest receivable - 151,006 151,006 Notes receivable - 2,000,000 2,000,000 Total Assets $ 4,307,926 S 48,104,348 S 52,412,2T4 Liabflfties and Fund Balances: Liabilities: Accounts payable $ - $ 2,059,079 $ 2,059,079 Deposits payable - 15,000 15,000 Amount due-pass-through agreements 1,364,399 - 1,364,399 Total Liabilities 1,364,399 2,074,079 3,438,478 Fund Balances: Reserved: Encumbrances - 19,462 19,462 Notes receivabie - 2,000,000 2,000,000 Continuing appropriations - 13,904,761 13,904,761 Unreserved: Debt service 2,943,527 - 2,943,527 Capital outlay - 30,106,046 30,106,046 Total Fund Balances 2,943,527 46,030,269 48,973,796 Tota! Liabflities and Fund Balances � 4,307,926 5 48,104,348 S 52,412,274 48 IAWI�ESB�RE OE/ELOPINENTAGENCY Schedule 2 t.DMBNPGSfA"IEV1E Ifi'�REVBdU ES, EJIPEND�TURES AND CHANGES IN FUND BALANCES DTHBtGDNENIVVENT'AL FUNDS FQ�THE 1'f�RBdDED JUNE 30, 2007 Debt Capital Service Project Fu nd Funds Totals F�arenuec: Ta�ea $ 3,563,031 $ - $ 3,563,031 QYerreverue - 74,338 74,338 In✓esF�eitea-drga 155,455 2,326,665 2,482,120 Zo�ll�rei�� 3,718,486 2,401,003 6,119,489 Ec pe�a tr�e�: Cunent C��eial ��errrr�e rt 4,215 386,489 390,704 F='utlic vQl� - 2,472,198 2,472,198 C:aptal �utl�y - 6,571,252 6,571,252 PaXrent bot�erage�des 1,8d6,366 - 1,806,366 De ti �ervica: Irteatandfscalcla�� 91,269 - 91,269 T��16c�endiLie� 1,901,850 9,429,939 11,331,789 6ccets� Raveruesaver (Uie�d E�perdtir� 1,816,636 (7,028,936) (5,212,300) OI!-erFrs�cJng S�vae� Q.lses� T'raislesin - 32,163,642 32,163,642 T'��sle�so�t (1,446,961) (242,922) (1,689,883) T��IQ tiei Are�drgS�vaea �.J«) ('1,446,961) 31,920,720 30,473,759 E��ss of reve ru e sa�d ot��rfinandng ta.i�es oT a U�de r� exo ei di ti re s ai d dhe rfii a-�d rg u�t 369,675 24,891,784 25,261,459 FundBat�r�es- Begnnir��fYea- 2,573,852 21,138,485 23,712,337 F�rd B�lor��s-E�dd Tear $ 2,943,527 $ 46,030,269 $ 48,973,796 49 PALM DESERT REDEVELOPMENT AGENCY Schedule 3 COMBINING BALANCE SHEET-OTHER GOVERNMENTAL FUNDS DEBT SERVICE JUNE 30,2007 Project Area 3 Totals Assets: Cash and investments $ 4,270,399 $ 4,270,319 Accounts receivable 37,607 37,607 Total Assets $ 4,307,926 $ 4,307,926 Liabilities and Fund Balances: Liabilities: Amount due-pass-through agreemenis $ 1,364,399 $ 1,364,399 7otal Liabilities 1,364,399 1,364,399 Fund Balances: Unreserved: Debt service 2,943,527 2,943,527 Total Fund Balances 2,943,527 2,943,527 Total Liabilities and Fund Balances $ 4,307,926 a 4,307,926 50 PALM DESERT REDEVELOPMENT AGENCY Schedule 4 COMBINING STATEMENT OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCES OTHER GOVERNMENTAL FUNDS-DEBT SERVICE FOR THE YEAR ENDED JUNE 30, 2007 Project Area 3 Totals Revenues: Taxes $ 3,563,031 $ 3,563,031 Investment earnings 155,455 155,455 Total Revenues 3,718,486 3,718,486 Expenditures: General government 4,215 4,215 Payment to other agencies 1,806,366 1,806,366 Debt seroice: Interest and fiscal charges 91,269 91,269 Total Expenditures 1,901,850 1,901,850 Excess of Revenues Over (Under) Expenditures 1,896,636 1,816,636 Other Financing Sources(Uses): Transfers out (1,446,961) (1,446,961) Excess of revenues and Other financing sources over(under) Expenditures and other financing uses 369,675 369,675 Fund Balances- Beginning of Year 2,573,852 1,999,867 Fund Balances-End of Year $ 2,943,527 $ 2,943,527 51 PALM DESERT REDEVELOPMENT AGENCY Schedule 5 COMBINING BALANCE SHEET-07HER GOVERNMENTAL FUNDS CAPiTAL PROJECTS JUNE 30, 2007 Project Project Area 3 Area 4 Totals ASSETS Cash and investments $ 2,828,575 $ - $ 2,828,575 Cash with fiscai agent 17,736,225 25,388,542 43,124,767 Receivables: Interest receivable 74,734 76,272 151,006 Notes receivabie - 2,000,000 2,000,000 TOTAL ASSETS S 20,639,534 $ 27,464,814 $ 48,104,348 LIABILITIES AND FUND BALANCES LIABILITIES: Accounts payable $ 194,186 $ 1,864,893 $ 2,059,079 Deposits payabfe - 15,000 15,000 TOTAL LIABILITIES 194,186 1,879,893 2,074,079 FUND BALANCES: Reserved: Notes receivable - 2,000,000 2,000,000 Encumbrances - 19,462 19,462 Continuing appropriations 3,056,251 10,848,510 13,904,761 Unreserved: Designated for capital outlay 17,389,097 12,716,949 30,106,046 TOTAL FUND BALANCES 20,445,348 25,584,921 46,030,269 TOTQL LIASILITIES AND FUND BALANCES S 20,639,534 $ 27,464,814 5 48,104,348 52 Schedule 6 PALN OE�EffiTF�DEVELOPMENTAGENCY C01161 A 11 G S'TAf ENBJr 0 F RE/E M UES, E3(PENDfTURES AND CHANGES NRJIiD tAlA1C6- 41FER GDVB�AIYIEi�1ALFUNDS -CAPITAL PROJECTS KRTH E T EAR E II D ED JUNE 30,2007 Project Project Area 3 Area 4 Totals REVE7J1 ES Inr�tn�ri eann9s $ 991,271 $ 1,335,394 $ 2,326,665 �h�rrc�a��es - 74,338 74,338 rOlAL.REVB�IU ES 991,271 1,409,732 2,401,003 EiFENp11tF�i: Gereralg�vernne�t 109,946 276,543 386,489 P�bicvedcs 193,749 2,278,449 2,472,198 C�pt� aul� - 6,571,252 6,571,252 T'OlAL EIPEIJDIrUF�6 303,695 9,126,244 9,429,939 ELC6i �F REVEIISDVER (tI�DER)EI�IDIi'ilF�6 687,576 (7,716,512) (7,028,936) Or HB2FNA Aa(rG 9CURC E5(U�6� T'rans��s r'n 13,923,580 18,240,062 32,163,642 frarts�s o�t (47,118) (195,804) (242,922) rOlAL DTHF32FNf�IC111G SDIRCES �JSE� 13,876,462 18,044,258 31,920,720 Eice� �freve�o�a►tioheriraicn� S�ucesae� �...ii�� e�e-idihrrs A�doherfinandng u�s 14,564,038 10,327,746 24,891,784 Fu-il B��s -Beym�g cf T�r 5,881,310 15,257,175 21,138,485 F�nd B�fa�c�• Erd�iYeor ;20,445,348 5z5,584,921 $ 46,030,2&9 53 PAUADESFI�t�EVELDN1lEMTAGENCY C011BNIIIC B4lAlIC�SH�1 HDISIJG �ifFD11�Y6fEC1/LREVENUEFUND .L rs 10,2101 Complexea L�guna Catalina Desert Las C�it�l Palrns C3erdens Polnte Serenes Neighbors A S6 E7"�: Ca� �cic,tk�g U,131,6i4 - 56,923 - 155,279 - �ifi •tn sl - - 24,194 22,397 48,482 8,478 Cafi •p�tq - 200 150 150 350 50 Acm ui U ncivtb► - - 5 2,078 436 - �efnnohr �atn�t - - - - 621,398 - IttaeA ecsi�tle 61,127 - . . . _ T'OTALA6�15 S 'D,191,7r1 $ 200 S 81,272 S 24,625 S 825,945 5 8,528 LlA81JTESl�1J0 RJIOBAIJ�tL'ES U/BLIIi�: .4outap+yib! $ f71,�3 $ 3,209 $ 9,072 $ 9,310 S 9,895 $ 2,696 �etaohe �ainaR - 824,200 77,423 28,357 �a ry l e�a�U - - 24,194 22,397 48,482 8,478 .acau�cinri�7rnnlf�s - 1,584 2,376 2,079 4,917 792 �ccx�e�p�rdl - 5,491 5,880 3,457 9,985 1,381 �ertoohe finls - - - - - lh�nc�l nv�n� - - 102 1,190 1,365 2 rUTA�LA81UTE9 f110i3 834,484 41,624 115,856 74,644 41,706 RJIDF3AtA1(�3 F�s rs t Eic�ra��a 6.6q0{2 - - - - - Gnlriur� .IpF�ntun 2.�f�J3 - - - - - R�sv�,e Re�ui�neitFind Larvinoonepvp�sis 63353 �8342841 39,648 (91,231) 751,301 (33,1T8) fQTALFIPO t/�dVt� 1,l17,718 �834284! 39,648 (9'1,231) 751,301 (33,178) f QTILLAB LffE S A PO F W I BAIL�FJ CEt $ �{,B'�7f 1 $ 200 S 81,272 S 24,625 j 825,945 S 8,528 � � 54 Schedule 7 Con{loica� (Crnthued) Dis Q�IIonY Cott�try Palm Total ComMned 4uil P�U a VII a la�s V Ilsg� Villege Cendlewood Complexes Tat�l _ . - - - • $ - 212,202 S 10,343,846 159,55'1 4 j31 3Q813 S51 I 5,125 - 8,440 320,871 320,871 ,:,� • 2I0 SO 15D - - 1,700 1,700 J� . - 6!O - - 4,115 4,115 �,g a3� . - - - - - 4,:i09,751 4,309,751 - • - - - • - - 60,127 � 7,�9,'f 0 S 4�31 I 31'113 � $21't $ 5,275 $ • S 8,440 $ 4,848,639 S 15,040,410 � � t3�Y $ 3,{6! � 531T3 $ 1118 $ 13T $ 3,914 $ 14,725 5 134,399 $ R08,962 1E3,f7{ 1.7445�3 9��I.S 1�,�41 51,441 158,293 4,309,751 4,309,751 159�51 4,131 34f313 �511 5,125 - 8,440 320,871 320,871 12�TL 19! -�653 58 3,133 4,320 990 , 3R,539 3A,539 S37 Y 1,!11 QSkl 7D 3,099 2,566 1,905 81,039 81,039 I-1�.� 91 7A d� i - 13 17,873 17,k73 2�87� 1?t,171 1.ffiQ4i3 'Uf2X3 178,142 62,241 184,366 4,902,972 5,577,035 - • - - • - - - 6,859,082 - • - - - - - - 2,595,293 9,000 9,000 Y,000 a�O��l n�,l-N) (1.�937D� �7,d92) (172.E67) (71,241) (175,926) (63,333) - �610�7�i n�.141) (1,�$31D) 07p42) �72,16i) (62,241) (175,926j (54,333) , 9,A63,375 -ir== S a819a� � 4,�31 3 S�,'1 Ii $ 9241 $ S,I7S $ - $ 8,440 S 4,84N,639 S 15,040,410 �-s-��.- � 55 PALM DESERT REDEVELOPMENT AGENCY COMBINING STATEMENT OF REVENUES,EXPENDITURES AND CHANGES IN FUND BALANCES-HOUSING AUTHORITY SPECIAL REVENUE FUND For the year endad June 30,2007 Complexas Leguna Catalina Desert Les Capita! Palms Gardens Polnte Serones Neighbors REVENUES; Rental income $ - S 14,774 S 268,117 $ 270,212 $ 659,328 $ 119,872 Investment earnings 279,848 - - - - - TOTAL REVENUES 279,848 14,774 268,117 270,212 659,328 119,872 EXPENDITURES: Current: Payroll - 88,989 94,312 42,189 122,346 23,151 Administrative 69,163 79,763 178,168 233,120 393,385 116,695 Management - 19,008 28,512 104,053 169,582 9,471 Maintenance 69,959 53,522 162 500 - 965 Capital outlay 6,018,318 - - - - - TOTAL EXPENDITURES 6,157,440 241,282 301,134 379,862 683,313 150,282 EXCESS OF REVENUES OVER (UNDER)EXPENDITURES (5,877,592) (226,308) (33,037) (109,630) (25,985) (30,410) OTHER FINANCING SOURCESfUSES: Transfers in 11,540,701 - - - - - Transfers out (1,000,000) - - - - - TOTAL OTHER FINANCING SOURCESlUSES 10,540,701 - - - - - EXCESS OF REVENUES AND OTHER FINANCING SOURCES OVER(UNDER)EXPENDITURES AND OTHER FINANCING USES 4,663,109 (226,508) (33,037) (109,650) (25,985) (30,410) FUND BALANCES-BEGINNING OF YEAR 4,854,599 (607,776) 72,685 18,419 777,286 (2,768) FUND BALANCES-END OF YEAR E 9,517,708 S �834,284) $ 39,648 S (91,231) S 751,301 S (33,178� 56 Schedule 8 Complexes(Continued) One California Country Palm Total Comb(ned Quail Pueblos Villas Taos Village Village Candlewood Complexes Total $ 2,429,051 5 55,279 $ 391,770 $ 92,561 $ 106,806 $ - $ 1Q1,356 $4,509,126 $ 4,509,126 - - - - - - - - 279,848 2,429,051 55,279 391,770 92,561 106,806 - 101,356 4,509,126 4,788,9T4 239,594 20,650 170,685 20,728 50,707 29,521 38,305 941,177 941,177 1,221,673 87,960 286,163 75,359 168,552 17,i09 100,136 2,958,�83 3,027,246 701,849 5,641 55,836 6,204 30,633 4,320 10,725 1,146,034 1,146,034 4,391 - 589,209 - - 11,291 128,116 788,156 858,115 - - - - - - - - 6,018,318 2,167,507 114,451 1,101,893 102,291 249,892 62,241 277,282 5,833,450 11,990,890 261,544 (59,172) (710,123) (9,730) (143,086) (62,241j (1T5,926) (1,324,324) (7,201,916) 1,000,000 - - - - - - 1,000,000 12,540,701 _ _ - - - - - - {1,000,000) 1,000,000 - - - - - - 1,000,000 11,540,701 1,261,544 (59,172) (710,123) (9,730) (143,086) (62,241) (175,926) (324,324) 4,338,785 2,338,830 (110,375) (2,099,207) (87,322) (29,781) - - 269,991 5,124,590 S 3,600,374 S (169,547) S (2,809,330) b (97,052) 5 (172,867) S (62,241) E (175,926) E (54,333) S 9,463,375 57 PALM DESERT REDEVELOPMENT AGENCY Schedule 9 COMPUTATION OF LOW AND MODERATE HOUSING EXCESS SURPLUS FUNDS AS OF JUNE 30,2007 Excess Surplus in the Low and Moderate Income Housing Fund is any unexpended or unencumbered amount that exceeds the greater of either $1,000,000 or the aggregate amount deposited in the Low and Moderate Income Housing Fund during the preceding four fiscal years. It is computed at the beginning of the fiscal year to which it relates. Tax Increment Fiscal Deposits to Year Housing Fund 2002-2003 $ 10,049,970 2003-2004 11,198,956 2004-2005 12,402,800 2005-2006 . 15,404,798 Total $ 49,056,524 Base Limitation $ 1,000,000 Greater Amount $ 49,056,524 Fund Balance of the Low and Moderate Income Housing Fund-July 1, 2006 33,862,544 Less: Unavailable amounts Encumbrances 3,910,018 Loans and notes receivable 7,737,247 Property held for resale 25,000 Prepaid items and deposits 4,009 Available Fund Balance of the Low and Moderate Income Housing Fund -July 1, 2006 $ 22,186,270 Computed Excess Surplus-July 1, 2006 $ - 58