HomeMy WebLinkAboutItem 01 FY19 Comprehensive Annual Financial Report AGENDA ITEM SUMMARY Meeting Date: 1/6/2020
Meeting Type: Work Session/Reg. Mtg Staff Contact/Dept.: Meg Allocco/Finance Staff Phone No: 541-726-3690
Estimated Time: 15 Minutes/Consent S P R I N G F I E L D C I T Y C O U N C I L Council Goals: Financially Responsible and Stable Government Services ITEM TITLE: FISCAL YEAR 2019 COMPREHENSIVE ANNUAL FINANCIAL REPORT (CAFR)
ACTION REQUESTED:
Work Session: Review the City’s Fiscal Year 2019 Comprehensive Annual Financial Report Regular Session: Motion to Formally Accept the City’s Fiscal Year 2019 Comprehensive Annual Financial Report
ISSUE STATEMENT:
In accordance with Oregon Statues and the City’s charter, the City is required to
complete an annual audit and financial statement. The report will be presented to the City Council at the January 6th work session. The Council will be asked to formally accept the report at their regular meeting that same night.
ATTACHMENTS: Attachment 1: City’s Fiscal Year 2019 Comprehensive Annual Financial Report Attachment 2: Communication with Governance at Audit Conclusion
DISCUSSION/ FINANCIAL IMPACT:
Grove, Mueller & Swank, the City’s independent auditors, have completed their audit of the City’s Fiscal Year 2019 CAFR and have issued their opinion thereon. Ryan Pasquarella, of Grove, Mueller & Swank, will review the audit process, the
Independent Auditor’s Report, and the City’s CAFR during the work session. As a preliminary summary for the Council’s information, you may note that the auditor’s found no material weaknesses in the City’s internal financial controls and they issued an “unmodified opinion” on the City’s financial statements. This means that the City is properly accounting for its resources and using adequate financial
controls to help prevent the improper use of those resources.
Comprehensive Annual Financial Report
Fiscal Year Ended June 30, 2019
City of Springfield, Oregon
springfield-or.govAttachment 1, Page 1 of 218
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CITY OF SPRINGFIELD, OREGON
COMPREHENSIVE ANNUAL
FINANCIAL REPORT
Fiscal Year Ended June 30, 2019 Prepared by: Finance Department
Accounting Division
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City of Springfield, Oregon
COMPREHENSIVE ANNUAL FINANCIAL REPORT Year Ended June 30, 2019
TABLE OF CONTENTS Page
INTRODUCTORY SECTION Letter of Transmittal 11-27
Organization Chart 29 Principal City Officials 30 Certificate of Achievement for Excellence in Financial Reporting 31 FINANCIAL SECTION Independent Auditor’s Report 37-39 Management’s Discussion and Analysis 43-57
Basic Financial Statements: Government-wide Financial Statements:
Statement of Net Position 61 Statement of Activities 62 Fund Financial Statements:
Balance Sheet – Governmental Funds 63 Statement of Revenues, Expenditures and Changes in Fund Balances – Governmental Funds 64 Reconciliation of the Statement of Revenues, Expenditures and Changes in Fund Balances of Governmental Funds to the Statement of Activities 65 Statement of Fund Net Position – Proprietary Funds 66 Statement of Revenues, Expenses and Changes in Fund Net Position – Proprietary Funds 67 Statement of Cash Flows – Proprietary Funds 68 Statement of Fiduciary Net Position – Agency Fund 69 Notes to Basic Financial Statements 71-117
Required Supplementary Information: Schedule of Revenues, Expenditures and Changes in Fund Balance – Budget and Actual:
General Fund 121 Street Fund 122 Police Local Option Levy Fund 123 SEDA Glenwood Fund 124 Required Supplementary Information Schedules for OPEB, CRP, and OPERS 125-129
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City of Springfield, Oregon
COMPREHENSIVE ANNUAL FINANCIAL REPORT Year Ended June 30, 2019
Other Supplementary Information: Non-major Governmental Funds Combining Statements: Combining Balance Sheet – Nonmajor Governmental Funds 135 Combining Statement of Revenues, Expenditures and Changes in Fund
Balance – Nonmajor Governmental Funds 136 Special Revenue Funds: Combining Balance Sheet – Nonmajor Special Revenue Funds 139 Combining Statement of Revenues, Expenditures and Changes in Fund Balances – Nonmajor Special Revenue Funds 140 Schedules of Revenues, Expenditures and Changes in Fund Balance – Budget and Actual: Special Revenue Fund 141 Transient Room Tax Fund 142
Community Development Fund 143 Building Code Fund 144 SEDA Downtown General Fund 145 Fire Local Option Levy Fund 146 Debt Service Funds: Combining Balance Sheet – Nonmajor Debt Service Funds 149 Combining Statement of Revenues, Expenditures and Changes in Fund
Balances – Nonmajor Debt Service Funds 150 Schedules of Revenues, Expenditures and Changes in Fund Balance – Budget and Actual:
General Obligation Debt Service Fund 151 Bancroft Redemption Fund 152 Capital Projects Funds: Combining Balance Sheet – Nonmajor Capital Project Funds 155
Combining Statement of Revenues, Expenditures and Changes in Fund Balances – Nonmajor Capital Project Funds 156 Schedules of Revenues, Expenditures and Changes in Fund Balance – Budget and Actual: Development Assessments Capital Projects Fund 157 Development Capital Projects Fund 158 SEDA Glenwood Capital Projects Fund 159 Street Capital Projects Fund 160
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City of Springfield, Oregon
COMPREHENSIVE ANNUAL FINANCIAL REPORT Year Ended June 30, 2019
Enterprise Funds:
Schedules of Revenues, Expenses and Changes in Fund Net Position – Budget and Actual: Sewer Fund 163
Storm Drainage Fund 164 Ambulance Fund 165 Booth Kelly Fund 166
Internal Service Funds: Combining Statement of Fund Net Position – Internal Service Funds 169 Combining Statement of Revenues, Expenses, and Changes in Fund Net Position – Internal Service Funds 170 Combining Statement of Cash Flows – Internal Service Funds 171 Schedule of Revenues, Expenses and Changes in Fund Net Position – Budget and Actual: Vehicle and Equipment Fund 172 Insurance Fund 173 SDC Administration Fund 174
Fiduciary Fund: Statement of Changes in Assets and Liabilities – Agency Fund 177
STATISTICAL SECTION 175
Financial Trend Information Net position by component 183 Changes in net position, last ten fiscal years 184-185 Fund balances, governmental funds, last ten fiscal years 186 Changes in fund balances, governmental funds, last ten fiscal years 187 Revenue Capacity Information Assessed value and actual value of taxable property, last ten fiscal years 191 Direct and overlapping property tax rates, last ten fiscal years 192 Principal property tax payers, current year and nine years ago 193
Property tax levies and collections, last ten fiscal years 194 Debt Capacity Information Ratios of outstanding debt by type, last ten fiscal years 197 Ratios of general bonded debt outstanding, last ten fiscal years 198 Direct and overlapping governmental activities debt 199
Legal debt margin information, last ten fiscal years 200 Pledged revenue coverage, last ten fiscal years 201
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City of Springfield, Oregon
COMPREHENSIVE ANNUAL FINANCIAL REPORT Year Ended June 30, 2019
Demographic and Economic Information Demographic and economic statistics, last ten calendar years 205 Principal employers, current year and nine years ago 206
Operating Information Full-time equivalent city government employees by function/program, last ten fiscal years 209
Operating indicators by function/program, last ten fiscal years 210 Capital asset statistics by function/program, last ten fiscal years 211 COMPLIANCE SECTION Audit Comments: Independent Auditor’s Report Required by Oregon State Regulators 217-218
Attachment 1, Page 8 of 218
Introductory Section
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CITY OF SPRINGFIELD, OREGON
FINANCE DEPARTMENT
ACCOUNTING / REPORTING ACCOUNTS RECEIVABLE / PAYABLE ASSESSMENTS
BUDGETING / TREASURY PAYROLL PURCHASING
225 FIFTH STREET
SPRINGFIELD, OR 97477 (541) 726-3705 FAX (541) 726-3782
www.ci.springfield.or.us
December 31, 2019
To the Citizens of Springfield, Oregon: Local ordinances and state statutes require that the City of Springfield issue a report on its
financial position and activity within six months of the close of each fiscal year. In addition, this
report must be audited in accordance with auditing standards generally accepted in the United States of America by an independent firm of certified public accountants. Pursuant to that requirement, we hereby issue the Comprehensive Annual Financial Report of the City of Springfield for the fiscal year ended June 30, 2019.
This report consists of management’s representations of the City’s finances. Consequently, responsibility for the accuracy of the data and for the completeness and fairness of the presentation, including all disclosures, rests with management. To provide a reasonable basis for making these representations, management has established a comprehensive internal control
framework that is designed both to protect the government’s assets from loss, theft, or misuse,
and to compile sufficient reliable information for the preparation of the City’s financial statements in conformity with Generally Accepted Accounting Principles (GAAP). Because the cost of internal controls should not outweigh their benefits, the City’s comprehensive framework of internal controls is designed to provide reasonable, rather than absolute, assurance that the
financial statements will be free from material misstatement. As management, we assert that, to
the best of our knowledge and belief, this financial report is complete and reliable in all material respects. The City of Springfield’s financial statements have been audited by Grove, Mueller & Swank,
P.C., a firm of licensed certified public accountants. The goal of the independent audit was to
provide reasonable assurance that the financial statements of the City of Springfield for the fiscal year ended June 30, 2019, are free of material misstatement. The independent audit involved examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements; assessing the accounting principles used and significant estimates made by
management; and evaluating the overall financial statement presentation. The independent
auditor concluded, based upon the audit, that there was a reasonable basis for rendering an unmodified opinion that the City of Springfield’s financial statements for the fiscal year ended June 30, 2019, are fairly presented in conformity with GAAP. The independent auditor’s report is presented as the first component of the financial section of this report.
GAAP requires that management provide a narrative introduction, overview, and analysis to accompany the basic financial statements in the form of Management’s Discussion and Analysis (MD&A). This letter of transmittal is designed to complement the MD&A and should be read in conjunction with it. The City of Springfield’s MD&A can be found immediately following the
report of the independent auditors.
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Profile of the Government The City of Springfield was incorporated on February 25, 1885. The City has a council-manager form of government. The six-member City Council sets overall city policy and goals. The City Council also makes laws, or ordinances, which govern the City. Councilors are nominated from
one of six wards and are elected at large for four-year staggered terms. The Mayor, elected at
large to a four-year term, is the chief elected officer of the City and is responsible for providing political and policy leadership for the community. The Mayor has no executive power, but presides at City Council meetings and serves as the ceremonial head of the City.
Home to approximately 61,355 people, Springfield is bordered north and south by the McKenzie
and Willamette Rivers, covering approximately 15 square miles in Lane County. The Springfield community has rich cultural assets, such as the Springfield Museum and Historic Interpretive Center, Washburne Historic District, Springfield Railroad Depot, Oregon Trail Mural, and Dorris Ranch Living History Farm.
The City provides a full range of municipal services. These services include police, fire, emergency medical services, municipal court, community planning and development, library, wastewater management, stormwater management, general public works, central service administration, and other functions associated with a full-service city.
For financial reporting purposes, the City includes all funds subject to appropriation by the City Council. In addition, the City includes all governmental organizations and activities for which the City Council is financially accountable. Therefore, the financial statements of the Urban Renewal Agency of the City of Springfield, although legally separate, have been blended with
those of the City by including them in the appropriate statements and schedules in this report.
Other potential component units have been evaluated and determined not to be component units of the City according to the criteria provided by the Governmental Accounting Standards Board. For financial planning and control, the City prepares and adopts an annual budget in accordance
with Oregon law. The law establishes standard procedures for preparing, presenting, and
administering the budget. It requires citizen involvement in the preparation of the budget and public disclosure of the budget before final adoption. The activities of all the funds of the City (except the Agency Fund, which accounts only for non-budgeted pass-through monies) are included in the annual budget, as required by state law. The City prepares its budget, as allowed
under Oregon law, using the modified accrual basis method of accounting. The legally adopted
budget is presented at the departmental level for current expenditures, with separate appropriations established for capital projects, debt service, inter-fund transfers, miscellaneous fiscal transactions, statutory payments, contingencies, unappropriated fund balances, and reserves.
Under the changes made by Measure 50, Oregon’s municipalities now levy their annual property taxes on a partial rate-based levy system. Springfield has been assigned a permanent tax rate of $4.7403 per thousand dollars of assessed valuation for its annual property tax operating levy. This amount can be temporarily overridden through the use of voter-approved serial levies. In
November 2012, Springfield voters renewed a special purpose five-year property tax levy for
police, municipal court, and jail services at a rate of $1.28 per thousand for five years beginning July 1, 2013. Subsequently, in November 2017, Springfield voters re-authorized that levy for another five years at an increased rate of $1.40 per thousand. In November 2015, voters re-
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authorized the levy for fire and life-safety services at a rate of $0.36 per thousand beginning July
1, 2016. Springfield still has the authority to levy an additional dollar value property tax levy for the retirement of its voter-approved general obligation bond debt. For the fiscal year ended June 30, 2019, the amount of the tax levy for general obligation debt was $0.40 per thousand. Local Economy July 2018-June 2019 The City of Springfield, Oregon continues to see gradual, positive, impacts of the long economic recovery, with continued patterns of investments in local manufacturing and traded sector
activities, increased values in property, momentum in private and public projects, and decreases
in city-wide residential inventory and commercial and industrial vacancy rates. Area businesses and local partners continue to play a role in this recovery, investing in existing Springfield facilities and Springfield employees, partnering with one another to improve the business ‘climate’ through sourcing relationships, events, and peer-to-peer support. These investments can
be seen clearly in increased interest and use of the Springfield Community Enterprise Zone, a
mechanism which incentivizes taxable investment and growth of workforce. With an emphasis on removing policy barriers, investment in infrastructure and support of existing industry retention and expansion, the City Council continues to champion projects and
initiatives which prioritize the economic vitality of the community, improving the lives of
Springfield citizens. The economic vitality of Springfield and the financial health of the City government is linked to healthy population growth and the number of quality jobs available in our community (Springfield Economic Look, 2017). Property Values Total assessed property values have steadily increased for the last five fiscal years, increasing
by 5% between FY 18 and
FY19. This reflects an increase in growth from past years which remained consistent at 3% year over last. In total, FY19
assessed property values in the
City of Springfield totaled nearly $4.9 billion, an increase of $233 million over FY 18.
$3,400,000,000
$3,600,000,000
$3,800,000,000
$4,000,000,000
$4,200,000,000
$4,400,000,000
$4,600,000,000
$4,800,000,000
$5,000,000,000
2013 2014 2015 2016 2017 2018 2019
Assessed Property Values
Springfield, OR
Source: Lane County, OR Assessment & Taxation Department
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Population Growth Springfield population trends have traditionally lagged behind those of the region, with estimated growth
over the last 10 years ranging
between 0% and 1%. Between 2016 and 2019, the City of Springfield saw a nearly 1% growth, similar to that of Eugene and Lane County,
both at 1%. It is notable that while
the region saw continued population growth in all areas between FY18 and FY19, Springfield saw a greater increase year over last, bringing the
City of Springfield population to
61,355, a difference of 490 community members from 2018. In general, Springfield’s population trends are attributable to a number of variables, including
population estimation methodology used by the Portland State University Population Research
Center, but also impacts of existing limited housing supply and land, rising costs of construction, trends in new single and multi-family housing starts, faster aging and lower fertility rates, and lower in-migration to the region. While slower than other regions across the state, population growth for the City of Springfield from 2018 through 2019 showed greater rates of growth than
years prior. 2019 reflected the second largest population jump for Springfield within the past 10
years, second only to the 2017 population growth of 515 community members. Similarly, the number of residential units constructed continue to grow, with 131 new units developed in FY19.
59,990 60,065 60,135 60,140
60,655
60,865
61,355
2013 2014 2015 2016 2017 2018 2019
Springfield OR Population
Source: Portland State University; Population Research Center. https://www.pdx.edu/prc/population-reports-estimates
78
37
96
114
88
125 131
2013 2014 2015 2016 2017 2018 2019
Springfield OR Residential Units
New Construction
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Eugene-Springfield, OR MSA
(Seasonally Adjusted)
Job Growth Job growth continues to increase in Lane County with unemployment in Springfield maintaining all time lows. While Springfield
saw a slight increase from 4.4% in FY18 to
4.5% in FY19, unemployment levels remain lower than historic averages over the last decade. While slightly higher than the State-wide average of 4.2%, trending remains
consistent with state averages over time, and
most importantly, on a generally flat trend. Overall, the City of Springfield and Lane County unemployment rates maintain similar trends to those captured state-wide and
nationally.
While the steady low levels of unemployment within the City of Springfield and greater Lane County is both significant and
promising, other regional indicators continue
to indicate slower overall growth than state averages. Per capita personal income in the region increased in 2018 by 4%, reaching $46K,
while the statewide figure grew by 5%. This
local growth trend remains consistent with the positive trends seen within Oregon on average. Additionally, Springfield employees saw increases in average wages of almost 20%
over the last 8 years, with the average annual
pay at a Springfield company exceeding $49K in 2018. This is higher than the Lane County average of $43.7K (qualityinfo.org).
Ultimately, the relationship between
unemployment rates, personal income, and wage growth emphasize the need for continued focus of City partnerships with employers and investments in resourcing projects which support increases in the number of accessible family wage jobs. For this reason, the City continued to
lead and resource significant initiatives within the community during FY19, focusing on support
of key target industries and projects. Springfield Target Industries
Springfield continues to see industry growth and opportunity in a wide range of nationally projected high output industries through 2024, including the highest projected industry: software publishers. This competitive advantage is of note for Springfield with the significant FY18 and
Source: State of Oregon Employment Department Qualityinfo.org; LAUS Reflected as Seasonally Adjusted Average of Year beginning July through June. Typical LAUS Reporting Reflects Calendar Year.
5.8% 5.5%
4.6% 4.4% 4.5%
2015 2016 2017 2018 2019
Unemployment Rate
Springfield, OR MSA
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FY19 impacts of the Springfield Symantec Site closure, creating brief opportunity for local talent
to be made available for new company expansions. In FY18, the City of Springfield participated in the successful recruitment of two significant technology firms specializing in software publishing and customer service. Both of these firms opened ‘doors’ in FY19 and hired substantial Symantec
talent, contributing to significant job growth and
allowing community members to stay and grow in new opportunities in Springfield and Eugene. These changes in employer presence also created opportunities for nearby existing Springfield employers, like
PacificSource Health Plans, IEQ Technologies and
Royal Caribbean Cruises Ltd., to hire much desired and well-trained talent. In FY19, Royal Caribbean was estimated to employ 800 people and PacificSource was moving into a substantial growth phase.
In FY19, the City of Springfield maintained a focus on local industry trends, prioritizing target industries for economic development with large footprints from a physical, economic, and employment standpoint.
Springfield, OR target industries include; advanced timber
manufacturing, technology, craft food and beverage, and medical technology. Springfield Significant Industry The Springfield traded sector target industries are
reflective of both future goals and also existing significant economic footprints. Industry location quotients (LQ) quantify the relative “concentration” of an industry compared to other areas within the United States. A LQ of
zero indicates that a particular region is no more or less
likely to host an industry than any other region. Where an area has a concentration of industries at a higher LQ, the area is demonstrating an area of industry density, or specialty.
The Springfield target industries are, primarily, reflective of industries with high local LQs, illustrating that Springfield already offers existing infrastructure, workforce, supply chains, and opportunities to facilitate successful operation and growth within these industries.
Springfield Industry Employer Sampling and Growth Trends The City of Springfield’s positive relationships with existing employers is a hard-earned and critical resource in fostering trust and facilitating opportunities to support growth and expansion of those industries and, specifically, employers. Employment data specific to an individual private employer is highly sensitive and considered protected information by the State
Employment Department. Any provision of listed private employers with directly attributed
private employment numbers would be speculative and at the risk of compromising established long-term relationship. A sample list of significant employers and estimated employment
Source: IMPLAN ES202 data, Bureau of Labor Statistics Employment 2015
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numbers is provided below based on information voluntarily and knowingly provided by
Springfield employers.
Industry Employer 2019 Estimated
Average Annual Employees
+ / -
Over 2018
2018 Estimated
Average Annual Employees
2017 Estimated
Average Annual Employees
Public Sector Springfield Public Schools 1560 + 1380 1241 Public Sector City of Springfield 402 + 400 410 Public Sector Willamalane 362 + 360 381 Public Sector State Government 320 + 310 308 Public Sector Federal Government 204 - 207 171 Medical Services Peace Health Corporation 3,760 + 3500 5500 Medical Services McKenzie-Willamette Medical Center 850 - 940 880 Wood Products Top 3 Wood Products Employers 820 + 780 522 Technology Top 3 Technology Employers 1180 - 1200 1800 Food & Beverage Top 3 Food Beverage Employers 490 + 410 400
Source: Public Sector employer estimates provided by the State of Oregon Employment Department. All other private employer estimates are considered protected information by the State Employment Department and reflective of estimates gathered through standard business retention efforts.
In FY19, the Springfield economy continued to experience overall growth across sectors, boasting nearly 2,200 businesses and over 34,000 jobs. From
2011 to 2018, the Springfield business community
grew by 20% with the addition of 370 new businesses and over 3,300 new jobs. Additionally, between 2011 and 2018, Springfield companies increased their annual wages paid to employees by
over $400M, bringing total wages paid by all
Springfield businesses in 2018 to almost $1.7 billion (does not account for inflation).
Source: State of Oregon Employment Department and City of Springfield, Oregon – Does not account for inflation.
Source: State of Oregon Employment Department and City of Springfield, Oregon 17Attachment 1, Page 17 of 218
Springfield Significant Event Sampling Manufacturing; Wood Products, Food and Beverage, and General Manufacturing
Swanson Lumber Mill Rebuild. The Swanson’s Group mill rebuild continues to be an example of Springfield’s incredible will and innovation. The rebuild, following a
devastating 2014 fire, was completed and back in production by 2016. The mill made final additions and installations of state of the art equipment and jobs, showcasing one of the highest technology manufacturing facilities on the west coast. The site includes a new 330,000 sf veneer plywood layup operation, and nearly
250 employees, and an investment estimated at over $55 million in facility and equipment. The site is a beneficiary of the Springfield
Community Enterprise Zone which provided a 5-year extended property tax abatement. The first non-exempted property tax year
will be 2022.
Glenwood Redevelopment. The Glenwood Riverfront project area and site infrastructure
to connect the community to the river continued as a priority initiative for the City of Springfield. The marketing of the site and recruitment of development partners kicked off in FY19 and saw traction with development partnerships and concepts for review by the Council and Urban Renewal Board.
Franz Bakery. Franz Bakery (owned by United States Bakery) completed construction in FY19 of their $20 million Glenwood facility expansion. The project was supported by the City with the use the Springfield Community Enterprise Zone extended abatement. The project increased their existing facility to over 200,000 square feet from the original
150,000 square feet. The project added 45 new full time employees operating a new
organic breadline. Franz now employs approximately 220 full-time employees in Springfield. Healthcare
McKenzie-Willamette Medical Center. The Mckenzie-Willamette Medical Center, located at 1460 G Street, completed construction of their major additions and renovations to hospital facilities in Springfield Mohawk area. The expansion project cost $115 million and added nearly 153,000 square feet of new space and an additional 56,000 square feet of
renovations to the existing structure. The project created private patient rooms for all
patients, added private exam and trauma rooms in the Emergency Room, constructed a new patient tower with new entrance, lobby and housing a new neonatal NICU (4-bed level II neonatal intensive care unit), expanded surgical and cardiovascular units, and beds for medical and surgical patients. The cardiovascular program and chest pain center has
doubled in size from eight to 16 total beds.
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Oregon Medical Labs & PeaceHealth. In late FY17, PeaceHealth sold a significant portion of their laboratory business to Quest Diagnostics, a New Jersey based for-profit. As part of this sale, services, employees, and local resources were maintained in the region but shifted to Quest Diagnostic ownership during FY18. During FY19, employment shifts were seen onsite at the PeaceHealth Annex site where Oregon Medical Labs operation
previously existed, but the building remains active with over 200 employees and under assessment for repurposing plans. Technology & Office Sector
Symantec. A substantial employer in the Springfield area for over 25 years, Symantec Corporation underwent substantial downsizing during FY19 with full site closure anticipated in Q2 of FY20. The City of Springfield worked closely with the firm during the timeframe to strategically position the building and employees for future success through
the transition and into targeted opportunities. In FY19, Symantec completed sale of the
property to PacificSource Health Plans.
PacificSource Health Plans. In FY19, locally owned and operated PacificSource Health Plans acquired 555 International Way. The 400,000 square foot building, previously
constructed, owned and occupied by Symantec, began substantial renovations and is planned as the future PacificSource regional headquarter. The project is anticipated for completion in FY20 and will allow the company to grow by an estimated 200 employees, bringing total regional employment to over 600 people.
Wayfair. In FY19, Wayfair opened their first west coast customer service center in Springfield. The firm, located in 555 International Way, is a tenant to PacificSource Health Plans, and has been a key employer in retaining local talent previously employed by
Symantec. The company began early hiring in late FY19 and is anticipated to reach over
400 employees by early FY20.
Office Space. The office sector in Springfield remained stable and tight in FY19, even with
the spike in space vacancy at the 555 International Way site. Office vacancy remained
historically low at 3%, lower than the national average of 11%. This low level of vacancy and the fact of little available sublet space to offer indicated a stable FY19 office sector and a market that could see additional product added in FY20 and on. In FY19, office rent averaged at $20.38 triple net.
Leisure, Hospitality and Mixed-Use
Transient Room Tax Collections. Transient Room
Tax (TRT) revenues have
steadily climbed over the past 10 years with a slight dip in FY18. FY19 saw a small rebound from FY18, reaching nearly $1.4M in
annual TRT revenues to the City.
FY19 was a milder wildfire season, generating less negative
Source: City of Eugene Central Services/Finance Division 19Attachment 1, Page 19 of 218
impact to the tourism industry over the summer and fall months. One large event venue,
Hayward Field, remained under construction in preparation for the 2020 Olympic Track and Field Trials and the 2021 IAAF World Track and Field Championships. Overall, Springfield hotel occupancies in FY19 were slightly down from FY18, averaging
63% across the year. The average daily rate (ADR) fell by just over 3.6% resulting in a
FY19 ADR of $92. These are likely reflections of a decrease in regionally held large sporting events and continued new hotel room inventory added in nearby City of Eugene.
Glenwood Tru Hotel. As part of a City and Urban Renewal Agency land assembly
project, several key properties in Glenwood were identified, assembled, prepped and sold to Alko Investments, LLC. Following the 2015 opening of a Candlewood Suites and 2018 opening of the Fairfield Inn and Suites, Alko Investments began construction of the third hotel product, Tru by Hilton. The Tru Hotel will add an additional 86 rooms to the site, bringing to total rooms available on the 2+ acre site to 175 rooms. The property will open
in FY20. Urban Growth Boundary Acknowledgement. Late in FY19, the Springfield urban growth boundary expansion area was acknowledged by the state and added over 250 suitable acres of employment land in the north Gateway area. While substantial planning
and infrastructure investments will be required to see the areas move into active use, the formal acknowledgement of the area is a critical early step towards future employment and property opportunities for the community. Street Bond Passing. In 2019, the Springfield voters approved a five year $10 million
general obligation bond to fund repairs for a list of proposed city streets. Streets identified for improvement serve both residential and commercial neighborhoods, and projects will begin in FY20.
Community Placemaking
Incenting Housing Development Through Springfield’s Affordable Housing Strategy. Beginning in FY18 and extending through FY19,
the City of Springfield offered Systems
Development Charge payments on behalf of developers building the newly permitted Accessory Dwelling Units (ADUs). This waiver is intended to reduce the cost to construct much needed housing
while incenting the use of the newly Council
approved smaller housing type. To support this goal, planning staff worked tirelessly with the community and City Council to
revise and amend the Springfield Development
Code, making it easier to build ADUs within the City. These amendments took effect in FY18 and impacts were seen. During FY19, the City received applications for 24 ADUs, 12 of which obtained land use approvals and proceeded to building permit phase.
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Long-term Financial Planning The City’s long range financial planning efforts mirror many other cities by producing trend line projections for both revenue and expenditures based upon individual analysis of both primary revenue and expenditures. The annual budget and five-year forecasts for the City’s more
significant funds serve as the foundation for the City’s financial planning.
Financial policies are central to a strategic, long-term approach to financial management. Currently, the City of Springfield has a three-page document representing the Financial Management Policies and recently initiated a project to review the fiscal health of our
organization starting with a review and revision of outdated policies. The current City policies
have three different update characteristics; these are: (1) policies that conflict with current practices; (2) policies that are simply out-of-date; and (3) policies that require clarification. Additionally, there are important policies that are not currently addressed, as well as policies that are better left to administrative process.
The Finance Department identified nine policies for potential revision with six completed to date. Our objective is to update other financial policies in order to develop a strategic, long-term approach to: (1) minimize the cost of government and reduce financial risk; (2) maintain appropriate financial capacity for present and future needs; and (3) ensure the legal use of
financial resources through an effective system of internal controls.
Another objective of the policy reviews was to better understand how budget decisions impact the long-term stability of the City’s financial position. A critical component is the make-up of the different accounting funds and how each has its own unique external forces that can impact
its financial stability. The last recession did not treat all funds equally and lessons can be learned
about the early identification of stress signs and what can be done to be able to respond in a timely manner. A part of this exercise is to ensure that staff is providing adequate guidance for the Council and Budget Committee in these matters.
The City’s major operating funds for General, Street, Building, Sewer, and Stormwater purposes
all meet current Council adopted policies for maintaining adequate contingency and working capital. The City’s Ambulance Fund is not currently meeting the guidelines for maintaining adequate contingency and working capital at this time; however, City staff are making this fund a top priority in its fiscal health exercise.
With a focus on fiscal health, the City is attempting to expand its window of planned financial stability from the 1-3-5-year window to a 5-10-15-year window. During fiscal year 2018, staff worked with the City Council to update its three-to-five-year strategic outcomes that are in response to the longer term Council goals.
In October 2018, staff scheduled a budget workshop with the City Council to discuss and receive direction on the next 5-year financial strategy that would begin with FY20. To prepare this workshop, projections and analytic data was updated to provide Council with the clear understanding of what strategies could best accomplish the goal of a sustainable financial future
in FY24. The accompanying data indicated that many of the City services requiring additional
resources through taxes are not seeing a growth in projected resources that is able to support the expected cost increases due to labor contracts and inflationary pressures. Using historical trends, expenditure growth is estimated to outpace revenue growth by about 2%. For local
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governments in Oregon, such as Springfield, there is a dependency on the health of the housing
and construction segment of the economy to support sustained growth. Recent planning and building activity for the City is indicating that there is a renewed confidence that housing activity for the community may allow for improved numbers.
Utility enterprise operations such as sanitary sewer and stormwater, where there is the ability for
the Council to make choices about raising monthly fees, have been better able to increase revenues to meet expenditure needs. Throughout this period, the combination of tempering expenditures with modest rate increases has allowed these enterprises to continue their vital maintenance needs.
The City updates it Capital Improvement Program (CIP) every two years and will be embarking on the latest update soon. Capital projects for the sanitary and stormwater programs are continuing to occur on schedule and have secure funding for the next CIP cycle. After borrowing funds in the early 2000’s to catch up on capital needs, these utilities have been able to
establish adequate reserves to meet current needs.
The City’s capital resources for street improvements have not been able to match capital needs and the City asked voters for the approval of a general obligation bond in November of 2018, which passed with 55% voter approval, to address the most immediate needs. The bond
proceeds will fund street improvement projects spanning the next five years.
Public Safety Services: The City continues to have two special-purpose taxing levies approved by the voters. Both
levies were initially approved in 2002 and have been re-authorized by citizens several times.
The levy for fire services allows the City to operate a fifth engine company for first response and fire services and was last approved for an additional five years beginning in FY17. The levy for police services funds additional services for patrol, dispatch, records, and our municipal jail. The citizens recently renewed the police levy for an additional five years beginning in FY19.
Urban Renewal: Within the past fifteen years, the City has initiated the formation of two urban renewal districts within our community. One is for the core downtown area and the other is for the Glenwood
area, located immediately adjacent to downtown and across the river. The formation of the two
urban renewal districts is important to the City’s strategy for attracting new or additional commercial and industrial businesses to our area. In the recent past, the City has adopted both a Glenwood Refinement Plan and a Downtown Revitalization Plan. For the Glenwood District, the City was awarded a $6 million transportation grant from the State which was be matched by
$3.6 million from the City to complete Phase I of the planned improvement for Franklin
Boulevard. Construction began in June 2017 and was completed in FY18. Phase II is in the early design stage with funding yet to be identified. For the Downtown District, the City has completed the second phase of the Improved Pedestrian
Lighting Project as well as transportation project improvements for the core Downtown area.
Also, in response to requests by Downtown merchants, the City has redesigned its parking program to include free on-street timed parking and available paid parking permits for City-owned lots. Both of these projects are a subset of the larger Main Street Visioning Project. The
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Urban Renewal District Board has no immediate plans for either the Glenwood or Downtown
District to borrow additional resources at this time. Capital Improvements:
The City of Springfield’s Capital Improvement Program (CIP) is a five‐year Community
Reinvestment Plan which describes the funding and construction of City public facilities. The Council biennially approves a list of public projects, such as transportation and streets, wastewater, stormwater, and buildings and properties, which are programmed for planning, design, and construction in the next five years. Programming in the CIP is based upon the most-current estimates of available funding. Actual funding decisions are made during the City’s
annual budgeting process. These projects are aimed at improving neighborhoods, providing for economic growth, improving traffic safety, and maintaining the existing City infrastructure and facilities. Some of the major projects in each of these program areas include the following: Transportation and Streets:
Street Preservation Program – In November 2018 Springfield voters passed a $10 million general obligation bond to be dedicated to preservation of several arterial and collector streets throughout the City. It is anticipated that the bond proceeds will allow the for an overlay preservation treatment to be completed on approximately 4.7 miles. Two projects
were completed in 2019 and the remaining projects are in various stages of design. All construction is anticipated to be completed by 2022. In addition to preserving the identified segments, American with Disabilities Act (ADA) facilities will be updated as required. Following is the list of projects identified in the Bond documents:
Street Length (feet) Estimated Cost Completion Date Olympic Street 3,700 $1,650.000 2020
Centennial Boulevard 2,600 $700,000 2020
Commercial Street 450 $85,000 2019 42nd Street 2,750 $855,000 2021
Thurston Road 5,800 $2,500,000 2021
High Banks Road/58th
St.
4,400 $1,700,000 2021
14th Street 1,250 $305,000 2019
Mohawk Boulevard 3,800 $2,100,000 2020
Virginia-Daisy Bicycle Boulevard/Virginia-Daisy Preservation – The City of Springfield partnered with the University of Oregon's 2011-2012 Sustainable City Year Program to plan Virginia/Daisy corridor bike boulevard improvements. Safety treatments along the entirety
of the corridor may include: increased signage to slow vehicles and identify the space as a
bicycle boulevard, striping of bicycle lanes, sharrows, traffic calming infrastructure (e.g., bulb-outs), and intersection treatments (e.g., mini-roundabouts). In 2015, the City received a $0.7 million State grant to implement this project. Additionally, the City has received $0.5 million in Surface Transportation Preservation – Urban (STP-U) funds to facilitate a surface
preservation project on the corridor that will be completed in advance of the bicycle
boulevard project. Due to funding constraints, the project has been split into three phases, with the first phase (43rd Street east to 51st Street) currently in design and planned for
23Attachment 1, Page 23 of 218
construction in FY 2020. Federal funding for Phase 2 (the 42nd Street Roundabout) has been
allocated to the City, and the City has begun the obligation process with the state. The City will continue to seek funding to complete the final phase of the project (32nd Street to 42nd Street and 51st Street to Bob Straub).
South 28th Street Paving – The City of Springfield received Congestion Mitigation Air Quality funding to be utilized for paving the gravel portion of S. 28th St. from South F St. to the city limits (approximately .25 miles). In addition to paving, the project will include extension of the existing gravity wastewater pipeline from F Street south to the City limits, and new stormwater features to manage and improve stormwater quality. Due to Oregon
Department of Transportation and Federal Highway Administration requirements, the City must utilize a certified agency to deliver the project. For this project the City is working with Lane County and the intergovernmental agreement is nearly complete, allowing project planning and design to begin shortly.
Wastewater:
CMOM Planning and Implementation – The City continues to make the repair, rehabilitation, or replacement of older wastewater pipes throughout the City a high priority in the Capital Improvement Program in an effort to reduce leakage of ground water into the
system. As part of this program, the City plans to rehabilitate approximately 4,500 feet of 27 inch sanitary trunk in 2020. The City continues to work on implementation of its Capacity, Management, Operations, and Maintenance (CMOM) program to remain in line with both State and Federal regulations. A flow monitoring plan and update of the collection system and the hydraulic model has been updated and the City is beginning the process of micro-
basin monitoring and modeling. The City will begin the process of updating the 2008 Wastewater Master Plan in the upcoming year. Stormwater:
42nd Street Levee Study – An initial study has been completed which identified several existing deficiencies. It also identified areas for further study and investigation of the condition of the High Banks Road (42nd Street) Levee to identify any structural or non-structural deficiencies and to evaluate the potential for obtaining federal accreditation of this dike as a flood control facility under the National Flood Insurance Program and for
compliance with the National Levee Safety Program. In October 1983, the City entered into an Agreement with the Soil Conservation Service for the operations and maintenance of the High Banks Road Dike that was constructed by Lane County in the 1950's adjacent to what is now known as 42nd Street. This dike provides flood control protection for areas of Springfield north of Highway 126 and west of 42nd Street from McKenzie River flooding.
The Federal Emergency Management Agency (FEMA) has developed an accreditation program for levees that are relied upon under the National Flood Insurance Program (NFIP) and the National Levee Safety Committee has developed recommendations to Congress for a National Levee Safety Program.
Channel 6 Flood Insurance Rate Map (FIRM) Update / Channel 6 Phase II – The Master Plan and an evaluation and update to the Flood Insurance Rate Map (FIRM) have been completed. Phase II will implement the Council approved Master Plan.
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Implementation will begin with an upgrade of several culverts to improve water flow and
mitigate potential flooding.
In addition to the above major projects, several other projects are also already budgeted and are currently in process or scheduled, including: Glenwood Stormwater Master Plan, Stormwater Channel Improvement, 5th Street/EWEB Path Storm Pipe, Mill Street
Reconstruction, and Franklin Boulevard Phase II design. Major Initiatives
The City Council goals for this year, along with some of the more significant activities and projects addressing those goals, are as follows: Provide Financially Responsible and Innovative Government Services
Urban growth boundary expansion to meet industrial zone employment needs
Infrastructure enterprise funds meet operating and capital requirements
Information technology infrastructure is available
Enhancements and customizations to existing applications will meet customer expectations Encourage Economic Development and Revitalization through Community
Partnerships
There is growth in the level of Glenwood Urban Renewal investment
There is growth in the level of Downtown Urban Renewal investment
Room tax receipts are meeting their set outcome measure
The infrastructure needed for growth is identified and planned
Target areas are planned and zoned for redevelopment to attract new business and attractions and/or eliminate blighted areas
Opportunities for affordable and decent housing are increased through partnerships with non-profit housing developers and providing assistance to low
and very low-income citizens throughout the community
Foster an Environment that Values Diversity and Inclusion
Percent of proposers on Public Works formal solicitations that self-identify as
minority, women, or emerging small businesses (MWESB)
City supports and encourages inclusion in advertisements for open positions, procurement and budgetary objectives
Effective and appropriate language services are provided while at the Springfield
Municipal Court
Percent of qualified applicants who meet City’s workforce diversity goals
25Attachment 1, Page 25 of 218
Strengthen Public Safety by Leveraging Partnerships and Resources
High priority calls are dispatched within 60 seconds of receipt
Medium priority calls are dispatched within five minutes of receipt
Low priority calls are dispatched within 10 minutes of receipt
Crime rate for property crimes is decreasing
Emergency ambulance responses are within eight minutes
Fire responses are within five minutes Maintain and Improve Infrastructure and Facilities
Planned infrastructure maintenance is performed
Preservation projects are completed on schedule
Out-of-service signalized intersection repaired within 48 hours of reporting
Capital projects are constructed to meet expanding needs Promote and Enhance Our Hometown Feel While Focusing on Livability and Environmental Quality
Student success and community literacy is supported
The quality of information services is improved
Access to Library services and collections is improved
Trash is reduced and community recycling is increased
Increase percent of current Stormwater Management Plan activities in compliance with the six minimum measures
Wastewater infrastructure systems meet regulatory performance requirements
Revitalization of low‐income neighborhoods is supported
Citizen requests and inquiries are given timely attention
Technology is used to make it easier for citizens to do business in Springfield through e-permitting and on-line access to information
Residents perception of Springfield is positive
Neighborhoods are healthy and active
Awards and Acknowledgements Awards
The Government Finance Officers Association of the United States and Canada (GFOA)
awarded a Certificate of Achievement for Excellence in Financial Reporting to the City for its Comprehensive Annual Financial Report (CAFR) for the fiscal year ended June 30, 2018. This was the thirty-eighth consecutive year that the government has achieved this prestigious award. In order to be awarded a Certificate of Achievement, a government must publish an easily
readable and efficiently organized Comprehensive Annual Financial Report. This report must
satisfy both generally accepted accounting principles and applicable legal requirements. A Certificate of Achievement is valid for a period of one year only. We believe our current comprehensive annual financial report continues to meet the Certificate of Achievement
26Attachment 1, Page 26 of 218
27Attachment 1, Page 27 of 218
28Attachment 1, Page 28 of 218
CITY OF SPRINGFIELD
Organization Chart
Citizens of Springfield
Mayor and City Council
City Attorney City Manager Municipal Judge
City Manager’s Office Development and Public
Works
Finance Fire and Life Safety
Human Resources Information Technology
Library Police
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City of Springfield, Oregon
Principal City Officials June 30, 2019
Elected Officials
Mayor
Term Expiration
Christine Lundberg
2031 2nd Street
Springfield, OR 97477
Council Members
December 31, 2020
Sean VanGordon 2327 Clear Vue Lane Springfield, OR 97477
Ward 1 December 31, 2022
Steve Moe 664 Sunset Drive Springfield, OR 97477
Ward 2
December 31, 2022
Sheri Moore 1955 16th Street Springfield, OR 97477
Ward 3
December 31, 2020
Leonard Stoehr 1005 S 41st Street
Springfield, OR 97477
Ward 4
December 31, 2020
Marilee Woodrow
1009 South 59th Street
Springfield, OR 97477
Ward 5
December 31, 2022
Joe Pishioneri
961 South 70th Street
Springfield, OR 97478
Ward 6
December 31, 2020
Administrative Officials Mary Bridget Smith City Manager Pro Tem Nathan Bell Finance Director
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31Attachment 1, Page 31 of 218
32Attachment 1, Page 32 of 218
Financial Section
33Attachment 1, Page 33 of 218
34Attachment 1, Page 34 of 218
Independent Auditor’s Report
35Attachment 1, Page 35 of 218
36Attachment 1, Page 36 of 218
475 Cottage Street NE, Suite 200, Salem, Oregon 97301
(503) 581-7788
INDEPENDENT AUDITOR’S REPORT
To the Honorable Mayor, Members of the
City Council and the City Manager
City of Springfield
225 5th Street
Springfield, Oregon 97477
Report on Financial Statements
We have audited the accompanying financial statements of the governmental activities, the business-type
activities, each major fund, and the aggregate remaining fund information of the City of Springfield,
Oregon (the City) as of and for the year ended June 30, 2019, and the related notes to the financial
statements, which collectively comprise the City’s basic financial statements as listed in the table of
contents.
Management’s Responsibility for the Financial Statements
Management is responsible for the preparation and fair presentation of these financial statements in
accordance with accounting principles generally accepted in the United States of America; this includes the
design, implementation, and maintenance of internal control relevant to the preparation and fair presentation
of financial statements that are free from material misstatement, whether due to fraud or error.
Auditor’s Responsibility
Our responsibility is to express opinions on these financial statements based on our audit. We conducted our
audit in accordance with auditing standards generally accepted in the United States of America and the
standards applicable to financial audits contained in Government Auditing Standards issued by the
Comptroller General of the United States. Those standards require that we plan and perform the audit to
obtain reasonable assurance about whether the financial statements are free from material misstatement.
An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the
financial statements. The procedures selected depend on the auditor’s judgment, including the assessment of
the risks of material misstatement of the financial statements, whether due to fraud or error. In making those
risk assessments, the auditor considers internal control relevant to the City’s preparation and fair
presentation of the financial statements in order to design audit procedures that are appropriate in the
circumstances, but not for the purpose of expressing an opinion on the effectiveness of the City’s internal
control. Accordingly, we express no such opinion. An audit also includes evaluating the appropriateness of
accounting policies used and the reasonableness of significant accounting estimates made by management,
as well as evaluating the overall presentation of the financial statements.
We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our
audit opinions.
37Attachment 1, Page 37 of 218
Opinions
In our opinion, the financial statements referred to above present fairly, in all material respects, the
respective financial position of the governmental activities, the business-type activities, each major fund,
and the aggregate remaining fund information of the City of Springfield, Oregon, as of June 30, 2019, and
the respective changes in financial position and, where applicable, cash flows thereof for the year then
ended in accordance with accounting principles generally accepted in the United States of America.
Other Matters
Required Supplementary Information
Accounting principles generally accepted in the United States of America require that the management’s
discussion and analysis (MD&A), schedule of revenues, expenditures, and changes in fund balance –
budget to actual for the General Fund, Street Fund, Police Levy Fund, and SEDA Glenwood Fund and the
required supplementary information schedules for OPEB, CRP, and OPERS as listed in the table of contents
be presented to supplement the basic financial statements. Such information, although not a part of the basic
financial statements, is required by the Governmental Accounting Standards Board, who considers it to be
an essential part of financial reporting for placing the basic financial statements in an appropriate
operational, economic, or historical context. We have applied certain limited procedures to the MD&A and
the required supplementary information schedules for OPEB, CRP, and OPERS in accordance with auditing
standards generally accepted in the United States of America, which consisted of inquiries of management
about the methods of preparing the information and comparing the information for consistency with
management’s responses to our inquiries, the basic financial statements, and other knowledge we obtained
during our audit of the basic financial statements. We do not express an opinion or provide any assurance
on the information because the limited procedures do not provide us with sufficient evidence to express an
opinion or provide any assurance.
The schedules of revenues, expenditures, and changes in fund balance – budget to actual (as described
above) are the responsibility of management and were derived from and relate directly to the underlying
accounting and other records used to prepare the basic financial statements. Such information has been
subjected to the auditing procedures applied in the audit of the basis financial statements and certain
additional procedures, including comparing and reconciling such information directly to the underlying
accounting and other records used to prepare the basic financial statements or the basic financial statements
themselves, and other additional procedures in accordance with auditing standards generally accepted in the
United States of America. In our opinion, the budgetary comparison information is fairly stated in all
material respects in relation to the basic financial statements as a whole.
Other Supplementary Information
Our audit was conducted for the purpose of forming opinions on the financial statements that collectively
comprise the City’s basic financial statements. The other supplementary information, introductory section,
and statistical section are presented for purposes of additional analysis and are not a required part of the
basic financial statements.
The other supplementary information is the responsibility of management and was derived from and relates
directly to the underlying accounting and other records used to prepare the basic financial statements. Such
information has been subjected to the auditing procedures applied in the audit of the basic financial
statements and certain additional procedures, including comparing and reconciling such information
directly to the underlying accounting and other records used to prepare the basic financial statements or to
the basic financial statements themselves, and other additional procedures in accordance with auditing
standards generally accepted in the United States of America. In our opinion, the other supplementary
information is fairly stated, in all material respects, in relation to the basic financial statements as a whole.
38Attachment 1, Page 38 of 218
The introductory and statistical sections have not been subjected to the auditing procedures applied in the
audit of the basic financial statements and, accordingly, we do not express an opinion or provide any
assurance on them.
Reporting Required by Legal and Regulatory Requirements
Reporting Required by Government Auditing Standards
In accordance with Government Auditing Standards, we have also issued our report dated December 27,
2019 on our consideration of the City’s internal control over financial reporting and on our tests of its
compliance with certain provisions of laws, regulations, contracts and grant agreements, and other matters.
The purpose of that report is solely to describe the scope of our testing of internal control over financial
reporting and compliance and the results of that testing, and not to provide an opinion on the effectiveness
of internal control over financial reporting or on compliance. That report is an integral part of an audit
performed in accordance with Government Auditing Standards in considering the City’s internal control
over financial reporting and compliance
Reporting Required by Oregon Minimum Standards
In accordance with Minimum Standards for Audits of Oregon Municipal Corporations, we have issued our
report dated December 27, 2019, on our consideration of the City's compliance with certain provisions of
laws and regulations, including the provisions of Oregon Revised Statutes as specified in Oregon
Administrative Rules. The purpose of that report is to describe the scope of our testing of compliance and
the results of that testing and not to provide an opinion on compliance.
GROVE, MUELLER & SWANK, P.C. CERTIFIED PUBLIC ACCOUNTANTS
By:
Ryan T. Pasquarella, A Shareholder
December 27, 2019
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40Attachment 1, Page 40 of 218
Management’s Discussion and Analysis
41Attachment 1, Page 41 of 218
42Attachment 1, Page 42 of 218
MANAGEMENT’S DISCUSSION AND ANALYSIS
This section of the City of Springfield’s annual financial report presents our discussion and analysis of the City’s financial performance during the fiscal year ended June 30, 2019. Please read it in conjunction with the City’s financial statements, which follow this section.
FINANCIAL HIGHLIGHTS
The City’s total assets and deferred outflows of resources at June 30, 2019 increased $19.5 million from $336.8 million to $356.3 million, or 5.8% from the prior year. This increase in total assets and deferred outflows of resources was primarily due to $9 million increase in the carrying value of capital assets and a $3.1 million increase in deferred pension outflows, a $6.3 million increase in cash and investments, a $.4 million increase in receivables and a $0.3 million increase in prepaid items.
The City’s total liabilities and deferred inflows of resources increased by $3.4 million from $115.9 million to $119.3 million, or 2.9% from the prior year. This increase was primarily due to a $4.3 million increase in net pension liability, and a $3.5 million increase in deferred pension and OPEB inflows, offset by a $3.6 million decrease in bonded debt and a $0.6 million decrease in the City’s net OPEB liability.
The assets and deferred outflows of resources of the City exceeded its liabilities and deferred inflows of resources by $236.9 million at the close of fiscal year 2019. Unrestricted net position totaled $23 million with the remainder of the City’s net position invested in capital assets ($186.7
million) and restricted for capital projects, public safety, transportation, community development, debt service, and other purposes ($27.2 million).
At June 30, 2019, the City’s governmental funds reported a combined ending fund balance of $31.6 million, a decrease of $.4 million (1.25%) from the prior year. Of this total amount, $9.2 million
(29.1%) constitutes unassigned fund balance which is available for spending at the government’s discretion, $21.8 million (68.9%) constitutes either restricted, committed, or assigned fund balance which is not available for new spending because it has already been committed to another purpose,
and the remainder of the fund balance, $0.6 million (2.0%) is in a nonspendable form.
At the end of fiscal year 2019, the unassigned fund balance in the General Fund was $9.2 million which was 24.7 % of total General Fund expenditures. OVERVIEW OF THE FINANCIAL STATEMENTS This discussion and analysis is intended to serve as an introduction to the City of Springfield’s basic financial statements. The City’s basic financial statements comprise three components:
Government-wide financial statements
Fund financial statements
Notes to the basic financial statements Government-wide Financial Statements The government-wide financial statements report information about the City as a whole using accounting methods similar to those used by private-sector companies. The statement of net position presents information on all of the City’s assets, deferred outflows of resources, liabilities, and deferred inflows of
43Attachment 1, Page 43 of 218
resources with the difference reported as net position. Over time, increases or decreases in net position
may serve as a useful indicator of whether the financial position of the City is improving or deteriorating. The statement of activities presents information showing how the City’s net position changed during the most recent fiscal year. All changes in net position are reported as soon as the underlying event giving
rise to the change occurs, regardless of the timing of related cash flows. Thus, revenues and expenses are reported in this statement for some items that will only result in cash flows in future fiscal periods (e.g. uncollected taxes).
Both of the government-wide financial statements distinguish functions of the City that are principally supported by taxes and intergovernmental revenues (governmental activities) from other functions that are intended to recover all or a significant portion of their costs through user fees and charges (business-type activities). The governmental activities of the City include:
General Government
Fire and Life Safety
Police
Library
Development and Public Works The business-type activities of the City include:
Sewer
Storm Drainage
Booth Kelly (operation of the Booth Kelly Center – a large commercial building and other similar activities)
Ambulance Service The government-wide financial statements include not only the City itself (known as the primary
government), but also a legally separate Urban Renewal Agency for which the City is financially accountable. The Urban Renewal Agency, called the Springfield Economic Development Agency (SEDA), has a governing body that is substantively the same as the City’s and City management is responsible for the
Agency’s operations. For these reasons, the SEDA special revenue and capital project funds are included as an integral part of the City. The government-wide financial statements can be found on pages 61-62 of the basic financial statements. Fund Financial Statements The fund is a grouping of related accounts that is used to maintain control over resources that have been segregated for specific activities or objectives. The City uses fund accounting to ensure and demonstrate compliance with finance-related legal requirements. All of the funds of the City can be divided into three
categories: governmental funds, proprietary funds, and fiduciary funds. Governmental funds. Governmental funds are used to account for essentially the same functions reported as governmental activities in the government-wide financial statements. However, unlike the government-wide financial statements, governmental fund financial statements focus on the acquisition and use of current spendable resources, as well as on balances of spendable resources available at the end of the fiscal year. Such information may be useful in evaluating a government’s near-term financing requirements.
44Attachment 1, Page 44 of 218
Because the focus of governmental funds is narrower than that of the government-wide financial
statements, it is useful to compare the information presented for governmental funds with similar information presented for governmental activities in the government-wide financial statements. By doing so, readers may better understand the long-term impact of the government’s near-term financing
decisions. Both the governmental fund balance sheet and the governmental fund statement of revenues, expenditures, and changes in fund balances provide a reconciliation to facilitate this comparison between governmental funds and government activities. The reconciliations can be found on pages 63 and 65 in
the basic financial statements. The City maintains 16 individual governmental funds. Information is presented separately in the governmental funds balance sheet and in the governmental fund statement of revenues, expenditures, and changes in fund balances for those funds that are considered significant (major) to the City taken as a
whole. These financial statements report four funds: General Fund, Street Fund, Glenwood General, and Police Local Option Levy Fund. Data from the other governmental funds are combined into a single, aggregated presentation. Individual fund data for each of these nonmajor governmental funds is provided
in the form of combining statements elsewhere in this report. The City adopts an annual appropriated budget for all governmental funds. To demonstrate compliance with the budget, budgetary comparison statements have been provided for the General Fund and the major special revenue funds as required supplementary information on pages 121-124. Budgetary comparisons for all other governmental funds have been provided elsewhere in this report. The governmental funds financial statements can be found at pages 63-65 in the basic financial statements. Proprietary funds. The City maintains two different types of proprietary funds. Enterprise funds are used to report the same functions presented as business-type activities in government-wide financial statements. The City uses enterprise funds to account for its Sewer operations, Storm Drainage
operations, Ambulance Service, and Booth-Kelly operations. Internal service funds are an accounting device used to accumulate and allocate costs internally among the City’s various functions. The City uses internal service funds to account for its equipment, including its fleet of vehicles and its computer and telecommunication equipment, for employee benefits and risk management activities, and for administrative activities related to the System Development Charge program. Because all three of these services predominantly benefit government rather than business-type functions, they have been included within governmental activities in the government-wide financial statements. Proprietary fund statements provide the same type of information as the government-wide financial statements, only in more detail. The proprietary funds financial statements provide separate information for the Sewer Fund, the Storm Drainage Fund, and the Ambulance Fund, which are all considered to be
major funds of the City. Conversely, the internal service funds are combined into a single, aggregated presentation in the proprietary funds financial statements. Individual fund data for the internal service funds is provided in the form of combining statements elsewhere in this report.
The proprietary fund financial statements can be found on pages 66-68 in the basic financial statements.
Fiduciary funds. The City is the trustee, or fiduciary, for certain funds. The City is responsible for ensuring that the assets reported in a fiduciary fund are used for their intended purposes. The City has
one fiduciary fund, the Agency Fund. All of the City’s fiduciary activities are reported in a separate statement of fiduciary net position and a statement of changes in assets and liabilities. We exclude these activities from the City’s government-wide financial statements because the City cannot use these assets
to finance its operations.
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The fiduciary fund financial statement of net position can be found on page 69 in the basic financial
statements. Notes to the financial statements. The notes provide additional information that is essential to a full understanding of the data provided in the government-wide and fund financial statements. The notes to the financial statements can be found on pages 71-117 of this report.
Required supplementary information. This report also presents certain required supplementary information concerning budgetary comparisons for the general and major special revenue funds as well as
information about the City’s progress in funding its obligation to provide pension and other post employment benefits to its employees. Required supplementary information can be found on pages 121-129 of this report.
Other supplementary information. The combining statements referred to earlier in connection with
nonmajor governmental funds and internal service funds, budgetary comparisons for proprietary funds, and the statement of changes in assets and liabilities of the agency fund are included in this report and can be found on pages 135-177.
Government-wide Financial Analysis As noted earlier, net position may serve over time as a useful indicator of a government’s financial position. In the case of the City, assets and deferred outflows exceeded liabilities and deferred inflows by $236.9 million at the close of the most recent fiscal year. The largest portion of the City’s net position, $190.2 million (80.3%) reflects its net investment in capital assets (e.g., land and right-of-way, buildings, improvements, equipment, and infrastructure, net of accumulated depreciation), less any related debt used to acquire those assets that is still outstanding. The
City uses these capital assets to provide services to citizens. Consequently, these assets are not available for future spending. Although the City’s investment in its capital assets is reported net of related debt, it should be noted that the resources needed to repay this debt must be provided from other sources, since
the capital assets themselves cannot be used to liquidate these liabilities.
2019 2018 2019 2018 2019 2018
Current and other assets 60,376,431$ 59,382,150$ 53,733,764$ 47,291,494$ 114,110,195$ 106,673,644$
Capital assets, net, where applicable,
of accumulated depreciation 146,340,540 135,465,267 76,005,342 77,831,489 222,345,882 213,296,756
Total assets 206,716,971 194,847,417 129,739,106 125,122,983 336,456,077 319,970,400
Deferred outflows of resources 14,976,943 12,290,529 4,829,530 4,496,367 19,806,473 16,786,896
Noncurrent liabilities 71,838,332 71,414,264 32,317,721 34,170,111 104,156,053 105,584,375
Other liabilities 6,092,161 5,262,418 2,093,862 1,539,247 8,186,023 6,801,665
Total liabilities 77,930,493 76,676,682 34,411,583 35,709,358 112,342,076 112,386,040
Deferred inflows of resources 5,739,645 2,980,877 1,256,307 523,867 6,995,952 3,504,744
Net position:
Net investment in capital assets 129,324,764 120,175,702 57,366,837 55,901,549 186,691,601 176,077,251
Restricted 20,647,784 22,674,644 6,575,305 5,457,331 27,223,089 28,131,975
Unrestricted (11,948,772) (15,369,959) 34,958,604 32,027,245 23,009,832 16,657,286
Total net position 138,023,776$ 127,480,387$ 98,900,746$ 93,386,125$ 236,924,522$ 220,866,512$
City of Springfield's Statement of Net Position
Governmental Business-type
Activities Activities Total
46Attachment 1, Page 46 of 218
A portion of the City’s net position, $27.2 million (11.5%), represents resources that are subject to
external restrictions on how they may be used. The remaining balance of unrestricted net position, $19.5 million (8.2%) may be used to meet the government’s ongoing obligations to citizens and creditors.
2019 2018 2019 2018 2019 2018
Revenues:
Program revenues:
Charges for services 10,247,021$ 9,624,408$ 23,522,767$ 21,918,787$ 33,769,788$ 31,543,195$
Operating grants and contributions 5,626,172 5,135,869 - - 5,626,172 5,135,869
Capital grants and contributions 4,181,484 2,177,260 2,540,505 1,164,761 6,721,989 3,342,021
General revenues:
Taxes 38,102,613 36,032,025 - - 38,102,613 36,032,025
Payment in lieu of taxes 2,403,565 2,414,018 - - 2,403,565 2,414,018
Shared revenue 2,026,255 1,743,533 - - 2,026,255 1,743,533 Investment earnings 1,557,790 783,330 1,176,791 528,250 2,734,581 1,311,580
Licenses permits and fees - - 78,860 - 78,860 -
Miscellaneous receipts 1,351,036 1,345,586 48,355 209,703 1,399,391 1,555,289
Total revenues 65,495,936 59,256,029 27,367,278 23,821,501 92,863,214 83,077,530
Expenses:
General government 8,570,530 7,450,495 - - 8,570,530 7,450,495
Fire and life safety 14,187,421 13,890,821 - - 14,187,421 13,890,821
Police 23,962,665 22,233,956 - - 23,962,665 22,233,956
Library 2,065,860 1,727,501 - - 2,065,860 1,727,501
Development & public works 13,921,361 12,687,939 - - 13,921,361 12,687,939
Unallocated depreciation and amortization 207,852 250,435 - - 207,852 250,435
Interest on debt 488,109 457,480 - - 488,109 457,480 Sewer - - 7,304,346 7,269,835 7,304,346 7,269,835
Drainage - - 5,968,181 6,316,516 5,968,181 6,316,516
Booth Kelly - - 1,300,368 1,410,609 1,300,368 1,410,609
Ambulance - - 7,212,214 6,515,453 7,212,214 6,515,453
Total expenses 63,403,798 58,698,627 21,785,109 21,512,413 85,188,907 80,211,040
Increase (decrease) in net position
before transfers 2,092,138 557,402 5,582,169 2,309,088 7,674,307 2,866,490
Transfers 67,548 63,000 (67,548) (63,000) - -
Increase (decrease) in net position 2,159,686 620,402 5,514,621 2,246,088 7,674,307 2,866,490
Net position - beginning, previously reported 127,480,387 126,859,985 93,386,125 91,140,037 220,866,512 218,000,022
Prior period adjustment - Note Q 8,383,703 - - - 8,383,703 -
Net position - beginning, as restated 135,864,090 126,859,985 93,386,125 91,140,037 229,250,215 218,000,022
Net position - ending 138,023,776$ 127,480,387$ 98,900,746$ 93,386,125$ 236,924,522$ 220,866,512$
Governmental Business-type
City of Springfield's Statement of Activities
Activities Activities Total
Entity-wide change in net position: Entity-wide net position increased by $7.7 million in the current fiscal year compared to an increase of $2.9 million in the prior year. This $4.8 million year-to-year increase in the change in entity-wide net position can be attributed to some one-time events in both the previous and current year, the details of which are provided below. Governmental Activities. The governmental activities during the fiscal year increased the City’s net position by $2.1 million, an increase from a prior year surplus of $.6 million, explained by the following highlights:
47Attachment 1, Page 47 of 218
Capital grants and contributions increased by $2.0 million (92.1%) from the prior year and can be primarily attributed to an increase in the transfer of infrastructure and right of way from developers to the City. While these transfers can be an indicator on the strength of development
occurring within the City, they can also fluctuate from year-to-year based on factors unrelated to the level of development occurring such as the timing of completion of single large projects and when the transfer occurs. This decrease is most likely the result of such timing fluctuations and the City is continuing to experience a healthy level of development activity within the City.
Operating grants and contributions increased by $0.5 million (9.8%) from the prior year. This is primarily attributed to an increase in highway apportionment funding.
Taxes increased by $2.1 million (5.8%) from the prior year and can be partially attributed to a $2.4 million increase in property tax receipts resulting from a continuation of appreciation of property values in the City and a one time property tax settlement. This continued appreciation in property values is a strong indicator of a healthy local economy and a strong housing market. Additionally there was a $0.2 million decrease in transient room taxes and $0.2 million decrease in local fuel tax.
Shared revenue increased by $0.3 million (16.2%) from the prior year. This increase from the prior year can be primarily attributed to the City’s receipts from the State of Oregon for state tax revenue from the sale of recreational marijuana.
Investment earnings in total increased by $0.8 million (98.9%) from the prior year and can be attributed to a full year of increases in the interest earned on its investments.
Primary government expenses as a whole increased 8%, while charges for services saw an
increase of $622,613 (6.5%) from the prior year.
Interest on long-term debt increased by $30,629 (6.7%) from the prior year and can be attributed the reduction in principal on the bonds, therefore lower interest and a newer note payable for SEDA that has its first full year of payments.
The net position increased in governmental activities by $2.2 million due to increased property tax collections and capital contributions. Additionally, a prior period adjustment was recognized for $8.4
million that represents a contribution to the total cost of major improvements to street infrastructure made by the Oregon Department of Transportation in prior years as explained in Note Q in the Notes to Financial Statements.
48Attachment 1, Page 48 of 218
0.0
5.0
10.0
15.0
20.0
25.0
30.0
Governmental Activities Expense and Program Revenues(in millions of dollars)
Expenses
Revenue
Chart 1
Chart 1 compares program revenues and expenses for the individual governmental activities for the current year. As the chart reflects, most governmental activities relied on general revenues to support the
function.
15.6%
6.4%
8.5%2.4%
58.2%
2.1%
3.7%
3.1%
Governmental Activities
Revenues by Source
Charges for services Miscellaneous
Capital grants and contributions Unrestricted investment earnings
Operating grants and contributions Contributions in lieu of taxes
Taxes Shared revenues Chart 2 Chart 2 shows the percent of the total for each source of revenue supporting governmental activities. The chart demonstrates that the City depends on taxes as its major source of revenue. The City is making a deliberate effort to increase revenues generated by charges for services both by implementing new fees and by increasing the cost recovery percentage on existing fees.
49Attachment 1, Page 49 of 218
Business-type Activities. The change in business-type activities increased from a $2.2 million surplus in
the prior year to $5.5 million in the current year. This increase of $3.3 million can be explained by the following highlights: Total operating expenses for all business-type activities increased by $0.1 million (0.6%) from
the prior year, which is relatively flat. This is due to inflationary pressures offset by vacant positions.
Total program revenues increased by $3.0 million (13%) from the prior year and can be primarily attributed to 34.5% increase ($1.9 million) increase in net ambulance billings as well as a 2.5%
rate increase in sewer fees, and a 2.5% rate increase in stormwater rates. Additionally, capital contributions doubled by increasing $1.4 million.
The change in net position for the Sanitary Sewer fund is an increase of $1,473,171. This is an increase of 7.9% over the prior year change in net position of $1,364,554. Program expenses
remained nearly flat with a .4% inflationary increase and charges for services dropped by 2% due to a decrease in billable flow; however this was offset by a 33% increase in capital contributions.
The change in net position for the Storm Drainage fund is an increase of $2,596,265. This is an increase of 132% compared to the prior year change in net position of $1,118,119. Program
expense decreased by 5% and charges for services revenue increased by 1%; however this was offset by a 444% increase in capital contributions from $240,008 in the prior year to $1,304,738 in the current fiscal year. It should be noted that capital contributions are normally volatile.
Ambulance expenses increased $.6 million from the prior year, although the revenue related to charges for services increased significantly by 34% due to new Ground Emergency Medical
Transportation (GEMT) revenue of $1.2 million as well as increased collections on past due accounts.
0.0
1.0
2.0
3.0
4.0
5.0
6.0
7.0
8.0
9.0
10.0
in millions of dollarsExpenses and Program Revenues -Business-type Activities
Program Revenues
Expenses
Chart 3
Chart 3 compares program revenues and expenses for the individual business-type activities for the current year.
50Attachment 1, Page 50 of 218
The Sewer, Storm Drainage, Ambulance, and Booth Kelly Funds all relied on program revenue to fund operating expenses.
85.9%
9.3%
4.3%0.5%
Revenues by Source -Business-type Activities
Charges for services
Capital grants andcontributionsUnrestricted investmentearningsMiscellaneous
Chart 4 Chart 4 shows the percent of the total for each source of revenue supporting business-type activities. The
largest component of business-type fund revenue comes from charges for services. Financial Analysis of the Government’s Funds As noted earlier, the City uses fund accounting to ensure and demonstrate compliance with finance-related legal requirements. Governmental funds. The focus of the City’s governmental funds is to provide information on near-term inflows, outflows, and balances of spendable resources. Such information is useful in assessing the
City’s financing requirements. In particular, fund balance may serve as a useful measure of a government’s net resources available for spending at the end of the fiscal year. As of the end of the current fiscal year, the City’s governmental funds reported combined ending fund balances of $31.6 million. Of this total amount, $9.2 million (29.1%) constitutes unassigned fund balance which is available for spending at the government’s discretion, $21.8 million (69%) constitutes either
restricted, committed, or assigned fund balance which is not available for new spending because it has already been committed to another purpose, and the remainder of the fund balance, $0.6 million (1.9%) is in a nonspendable form. The General Fund is the chief operating fund of the City of Springfield. At the end of the current fiscal year, unassigned fund balance of the General Fund was $9.2 million, while the total fund balance was
$10.8 million. As measure of the General Fund’s liquidity, it may be useful to compare both unassigned fund balance and total fund balance to total fund expenditures. Unassigned fund balance represents 24.7% of total General Fund expenditures, while total fund balance represents 29% of that same amount.
51Attachment 1, Page 51 of 218
The fund balance of the City’s General Fund increased by $1.0 million during the current fiscal year which is comparable to the $1.0 million increase in the prior year. While the increase is similar, there are still some highlights worth mentioning:
Property taxes increased by $1.5 million (7.1%) from the prior year and can be attributed to
normal growth resulting from the strengthening of property values in the City, as well as a property tax settlement received for $0.5 million.
Licenses, permits, and fees decreased slightly (2.1%) from the prior year and can be attributed to a leveling out the last two years after a spike in all City license, permit, and fee revenue in fiscal
year 2017.
General government expenditures increased by $0.6 million (9.5%) from the prior year and can be primarily attributed to a dip in the prior year and staffing vacancies being filled that had been open. Additionally, staffing and other costs increased in Information Technology as tighter cyber security controls are implemented.
Fire and Life Safety expenditures increased by $0.1 million (1.2%) from the prior year and can be primarily attributed normal inflationary pressures. Police expenditures experienced an increase of $.6 million (4.3%) remaining relatively flat with the exception of inflationary factors and radio purchases.
Debt service in the General Fund decreased by $0.5 million to zero in the current year as a result of the early payoff of the loan used to construct Fire Station 16.
The Street Fund balance increased by $0.5 million in the current fiscal year compared to a prior year increase of $0.7 million. This year-to-year decrease of $0.2 million can be primarily attributed to the ramp up of staff for street projects that were started in this fiscal year and the leveling out of highway apportionment revenue.
The Police Local Option Levy Fund balance increased by $0.6 million in the current year compared to a decrease of $0.3 million in the prior year. This year-to-year increase of $0.9 million can be primarily attributed to a $0.8 million increase in property tax revenues, a portion of which was part of the one time property tax settlement also experienced in the General Fund. An increase in charges for services was also a factor as more jail beds were rented out in FY19 than the prior year. The Glenwood General Fund is a major fund this year for the first time. This is driven by the large capital project expense of a land purchase that happened in the current year which spiked the expenses for the
SEDA Glenwood Fund.
Proprietary funds. The City’s proprietary funds provide the same type of information found in the government-wide financial statements, but in more detail.
52Attachment 1, Page 52 of 218
As of the end of the current fiscal year, the City’s proprietary funds reported a combined ending net
position of $98.9 million. Of this amount, $34.9 million (35.3%) constitutes unrestricted net position. Proprietary fund highlights are as follows:
The Sewer Fund reported a $2.3 million increase in net position. The sewer rates are set to provide for sufficient net operating revenue to fund capital projects in the sewer system, as well as comply with bond covenants. The user rate increase for FY19 was 2.5% however net operating income declined by $192K.
Sewer user fee revenue is a function of billable flow and rates. During FY19, the system experienced a 2% decline in billable flow. The change in net position of was driven mainly by increased interest income totaling $614K and increased capital contributions totaling $1.2M. The Storm Drainage Fund reported a $3.1 million increase in net position. The storm rate increase of 2.5% was a factor in the increase, and helps produce sufficient net revenue to fund capital projects and satisfy bond requirements. The most significant differences between the 2018 net position increase ($1.6 million) and the 2019 net position increase ($3.1 million) was an increase in capital contributions of $1.5 million and an increase in interest income of $265K. The Ambulance Fund reported a $.1 million increase in net position. This increase was primarily due to a
significant increase in charges for services with the receipt of $1.0 million of new Ground Emergency Medical Transportation (GEMT) payments for the current fiscal year and retroactive to the prior year. This new revenue source helps offset some of the losses from Medicaid emergency transports. This
revenue, along with increased collection efforts on bad debts, has put the ambulance fund in an improved position over the prior year. The fund is still challenged by the competitive market for ambulance billing services as it endeavors to maintain its customer base.
General Fund Budgetary Highlights The difference between the original budget and the final amended budget was a net increase of $1,056,822. Details of this increase are as follows: $ 429,267 increase to General Government
25,367 increase to Library
81,544 increase to Development Services
238,313 increase in Fire & Life Safety
12,777 increase to City Attorney
9,848 increase in transfers
259,706 increase in the City reserves For actual expenditures, the City General Fund under spent the amended budget by $798,762. The continuation of the impacts of the economic recession is still noticeable in the trending of two significant revenue sources for the City: charges for service and licenses, permits, and fees. Improvement is being seen in both of these categories although they remain below the pre-recession levels. Property tax revenues trending for this same period indicate that while most residential property has moved back to or beyond pre-recession levels. These differences in actual revenue received compared to the amended budget are as follows:
53Attachment 1, Page 53 of 218
$ 1,072,800 increase in taxes
11,627 decrease in licenses, permits and fees
259,549 increase in intergovernmental revenues
350,015 increase in interest and investment earnings
352,418 decrease in charges for service
51,986 decrease in fines and forfeitures
51,534 increase in miscellaneous revenues
277,340 decrease in internal transfers
871,730 increase in beginning cash (amended over adopted budget) For the year ended June 30, 2019, the total variance between the final amended budgeted revenue and the actual budget-basis revenue amounts in the General Fund (both less beginning cash) was 2.77%, where actual revenues were more than budgeted revenues. The combined actual current and delinquent property
tax revenues exceeded the budgeted amounts by 5.07% due in large part by a delinquent tax payment from a large commercial payer. Licenses and permits continue to grow as the economy improves, but the City is still experiencing a reduction from previous strong economy levels. Fines and forfeitures were lower as municipal court revenue continues to experience delinquent accounts combined with efforts to offer alternative sentencing options. Beginning fund balance on July 1, 2018 was $871,730 greater than budgeted (9.8%) while ending fund balance on June 30, 2019 was $1,442,166 (15.5%) greater than was projected in the FY20 adopted budget. Capital Asset and Debt Administration Capital Assets. The City’s investment in capital assets for its governmental and business-type activities as of June 30, 2019, amounts to $222.3 million (net of accumulated depreciation). This investment in capital assets includes land, buildings, sewer pipes, improvements, machinery and equipment and roads.
Major capital asset events and improvements during the current fiscal year include the following:
ODOT donated a portion of the Franklin Boulevard Phase I project, which the City completed last year. This was added to the capital assets as a prior period adjustment of $8.3 million.
Other donated streets and right-of-way were recorded at an estimated cost of $2.8 million.
Two Street Lighting projects were completed at a combined cost of $.5 million.
The Main Street Pedestrian crossing project was completed at a cost of $.6 million.
$5.7 million was added to the Land category, representing a property purchase by the SEDA - Glenwood.
Donated Sewer and Storm sewer lines were recorded at an estimated cost of $1.3 million.
Sanitary Sewer Rehab A was completed and capitalized for $.7 million.
54Attachment 1, Page 54 of 218
City of Springfield’s Capital Assets (net of depreciation)
2019 2018 2019 2018 2019 2018
Land 74,084,561$ 67,615,125$ 6,375,436$ 6,375,436$ 80,459,997$ 73,990,561$
Land improvements - - 19,073 20,316 19,073 20,316
Work in progress 1,149,649 2,499,103 875,262 638,802 2,024,911 3,137,905
Buildings 18,632,669 21,034,465 68,001,102 69,749,665 86,633,771 90,784,130
Infrastructure 44,903,942 37,010,483 - - 44,903,942 37,010,483
Machinery & equipment 7,182,454 6,869,125 266,599 446,084 7,449,053 7,315,209
Studies 387,265 436,966 467,870 601,186 855,135 1,038,152
Total 146,340,540$ 135,465,267$ 76,005,342$ 77,831,489$ 222,345,882$ 213,296,756$
Governmental Activities Business-type Activities Total
Additional information on the City’s capital assets can be found in Note F in the Basic Financial Statement section of this report.
Debt Administration. At the end of the current fiscal year, the City had total bonded debt outstanding of $29.4 million. Of this amount, $11.6 million comprises debt backed by the full faith and credit of the City. The remainder of the City’s debt represents bonds secured solely by specified revenue sources.
City of Springfield’s Outstanding Debt General Obligation and Revenue Bonds
2019 2018 2019 2018 2019 2018
General obligation
bonds - 2016 11,630,000$ 13,075,000$ -$ -$ 11,630,000$ 13,075,000$
Revenue bonds
series 2010 - - 6,765,000 7,215,000 6,765,000 7,215,000
Revenue bonds
series 2017 - - 11,045,000 12,290,000 11,045,000 12,290,000
Total 11,630,000$ 13,075,000$ 17,810,000$ 19,505,000$ 29,440,000$ 32,580,000$
Governmental Activities Business-type Activities Total
The City’s total bonded debt decreased by $3.1 million during the current fiscal year. For additional information on the City’s long-term debt, see Note I in the Basic Financial Statement section of this report. Economic Factors and Next Year’s Budgets and Rates During the preparation of the budget for the ensuing fiscal year, the long-term impacts of the local economy were examined in conjunction with business decisions made by the City. The following are the major assumptions used in developing the FY20 budget:
Assessed (taxable) value for the City is projected to increase by 3.25%. Residential should receive an increase of 3.0% under the guidelines established by Measures 49 and 50, industrial is likely to remain flat and expectations are for a slight increase in commercial property values. A major mill fire
55Attachment 1, Page 55 of 218
in the community in July 2014 will continue to have an impact on the City’s real market and assessed
valuation for several more years.
Earnings on investments, primarily government and corporate bonds, may reach 3.0% with the overall market possibly viable for debt refinancing. Inflation will not be a major factor during the next fiscal year as it appears that Federal Reserve is following its intent to start slowly raising rates on a quarterly basis.
AFSCME employees, the City’s smallest employee group, will receive a 2.5% cost of living adjustment on July 1, 2019. SEIU employees received market pay adjustments July 1, 2018 as a result of a market survey completed in the spring of 2018 that resulted in an average increase of approximately 3%. No additional increases were implemented in FY19. Non-union employees received their first increase in 3 years on July 1, 2018, also a result of a completed market study.
Springfield Police Association (SPA) employee’s current contract covers the 3 year period from July
1, 2017 through June 30, 2020 and provided for a 3% cost of living increase effective for the years beginning July 1, 2018 and July 1, 2019.
The International Association of Fire Fighters (IAFF) now has two contracts with the City as the battalion chiefs are now a separate represented unit. The main contract has been negotiated with a three year contract that will expire on June 30, 2021. Members represented by this contact will receive a cost of living increase on July 1, 2018 of 2.5%, July 1, 2019 of 2.5%, and July 2, 2020 equal to CPI-U. The battalion chief’s contract will expire on June 30, 2021 and calls for a cost of living increase on July 1, 2018 and July 1, 2019 of 2.5%, another increase of 1% on January 1, 2019 and January 1, 2020 plus a final adjustment on July 1, 2020 equal to CPI-U. Both adjustments for the main contract and battalion chiefs on July 1, 2020 that follow CPI-U will not be less than 2% and not greater than 3%.
The plan year for health insurance is the calendar year. Beginning January 2013, the City initiated a self-funded insurance program with the administration of the program contracted out to a private provider. The City’s experience factors since becoming self-insured have been very positive. For January 1, 2019, the City held rates flat. For the plan year beginning January 1, 2020, the City is not projecting an increase.
Oregon PERS rates are bi-annual and rates were adjusted on July 1, 2017 and in effect until June 30, 2019. No rate change occurred on July 1, 2018. In FY19, the City had three separate PERS retirement rates for its employees with the lowest % rate increase being 8.31% and the highest at 16.85% with an estimated dollar impact over the two year period of $2.9 million. For FY20 the City experienced a rate hike of about 35%. Based on rate projection figures provided by Oregon PERS, this relative impact is expected to be seen in at least for the next biennium (FY22-23) but may begin to level off after that.
The City schedules an updated actuarial study of its City Retirement Plan every two years. The next update is as of July 1, 2020 and will be completed in the fall of 2021 and implemented on July 1, 2020. The percentage of payroll contribution for members of this plan has stayed constant at 30% since July 1, 2017 and will continue at this rate through June 30, 2020.
The economic response towards building and construction activity is expected to increase at a consistent pace for the next year. Growth in building permit revenue is expected to slow as several major commercial rebuilds have been completed but residential is expected to continue to show
56Attachment 1, Page 56 of 218
improvement. Larger multi-house subdivisions appear to be in the planning stages with smaller
clusters of new housing still being built. The recently re-built lumber mill destroyed by fire is back in operation but will remain below pre-shutdown levels.
Monthly rates for both the City’s sewer and storm water drainage programs increased on July 1, 2019 as a result of increased costs. The local storm water increase was 2% and the local wastewater increase was 2% for the fiscal year July 1, 2019 through June 30, 2020. Requests for Information This financial report is designed to provide a general overview of the City’s finances for those with an interest in the government’s finances. Questions concerning any of the information provided in this report or requests for additional financial information should be addressed to: Accounting Manager
City of Springfield 225 Fifth Street Springfield, OR 97477
57Attachment 1, Page 57 of 218
58Attachment 1, Page 58 of 218
City of Springfield, Oregon
Basic Financial Statements
59Attachment 1, Page 59 of 218
60Attachment 1, Page 60 of 218
Governmental Business-type
Activities Activities Total
ASSETS
Cash and investments 53,876,916$ 46,920,275$ 100,797,191$
Receivables, net of allowance for
uncollectable receivables 5,805,343 4,349,319 10,154,662
Internal balances (659,990) 659,990 -
Inventory 298,264 - 298,264
Investment in foreclosed properties 1,970 - 1,970
Prepaid items 416,396 36,478 452,874
Deposits 200,000 - 200,000
Accrued interest 188,991 144,887 333,878
Net OPEB asset - RHIA 248,541 73,540 322,081
Due from other governments - 1,549,275 1,549,275
Capital assets:
Land and work in progress 75,234,210 7,250,698 82,484,908
Other capital assets, net of accumulated depreciation 71,106,330 68,754,644 139,860,974
Total assets 206,716,971 129,739,106 336,456,077
DEFERRED OUTFLOWS OF RESOURCES
Deferred pension outflow 14,293,384 4,006,220 18,299,604
Deferred OPEB outflow 438,321 144,248 582,569
Deferred charge for debt refunding 245,238 679,062 924,300
Total deferred outflows of resources 14,976,943 4,829,530 19,806,473
LIABILITIES
Current liabilities:
Accounts payable 2,854,796 1,063,854 3,918,650
Accrued payroll and other liabilities 2,935,643 584,233 3,519,876
Unearned revenue 179,500 228,996 408,496
Accrued interest payable 40,214 170,075 210,289
Deposits 59,861 46,704 106,565
Due to other governments 22,147 - 22,147
Noncurrent liabilities:
Due within one year:
Accrued claims liabilities 413,701 - 413,701
General obligation long-term debt 1,505,000 - 1,505,000
Revenue bonds payable - 1,740,000 1,740,000
Notes payable 567,965 - 567,965
Capital leases 146,970 - 146,970
Due in more than one year:
Accrued absence payable 3,245,652 570,930 3,816,582
Accrued claims liabilities 301,299 - 301,299
General obligation long-term debt (net of unamortized premium)11,738,366 - 11,738,366
Revenue bonds payable (net of unamortized discount)- 17,577,564 17,577,564
Notes and contracts payable 3,362,328 505,833 3,868,161
Capital leases 150,385 - 150,385
Net pension liability 44,998,348 10,672,017 55,670,365
Net OPEB liability - City Plan 5,408,318 1,251,377 6,659,695
Total liabilities 77,930,493 34,411,583 112,342,076
DEFERRED INFLOWS OF RESOURCESDeferred pension inflow 4,607,976 825,031 5,433,007
Deferred OPEB inflow 1,131,669 431,276 1,562,945 Total deferred inflows of resources 5,739,645 1,256,307 6,995,952
NET POSITIONNet investment in capital assets 129,324,764 57,366,837 186,691,601 Restricted for:
Capital projects 1,574,516 6,575,305 8,149,821 Public safety 3,226,314 - 3,226,314
Transportation 7,698,978 - 7,698,978 Urban renewal 1,607,275 - 1,607,275 Community development 5,368,061 - 5,368,061
Debt service 554,274 - 554,274 Other purposes 618,366 - 618,366
Unrestricted (11,948,772) 34,958,604 23,009,832
Total net position 138,023,776$ 98,900,746$ 236,924,522$
The accompanying notes are an integral part of this statement.
City of Springfield, Oregon
STATEMENT OF NET POSITION
June 30, 2019
61Attachment 1, Page 61 of 218
Functions/Programs
Charges Operating Capital Grants Total Total
for Grants and and Governmental Business-type
Expenses Services Contributions Contributions Activites Activities Total
Primary government:
Governmental activities:General government 8,570,530$ 4,194,777$ 210,016$ (31,500) (4,197,237)$ -$ (4,197,237)$
Fire and life safety 14,187,421 2,012,641 96,656 345,455 (11,732,669) - (11,732,669)
Police 23,962,665 1,041,123 285,467 - (22,636,075) - (22,636,075)
Library 2,065,860 118,372 123,139 - (1,824,349) - (1,824,349)
Development and public works 13,921,361 2,880,108 4,910,894 3,867,529 (2,262,830) - (2,262,830)
Depreciation, unallocated 207,852 - - - (207,852) - (207,852) Interest on long-term debt 488,109 - - - (488,109) - (488,109)
Total governmental activities 63,403,798 10,247,021 5,626,172 4,181,484 (43,349,121) - (43,349,121)
Business-type activities:Sanitary sewer 7,304,346 7,541,750 - 1,235,767 - 1,473,171 1,473,171
Storm drainage 5,968,181 7,259,708 - 1,304,738 - 2,596,265 2,596,265
Booth Kelly 1,300,368 1,481,538 - - - 181,170 181,170
Ambulance 7,212,214 7,239,771 - - - 27,557 27,557
Total business-type activities 21,785,109 23,522,767 - 2,540,505 - 4,278,163 4,278,163
Total primary government 85,188,907$ 33,769,788$ 5,626,172$ 6,721,989$ (43,349,121) 4,278,163 (39,070,958)
General revenues:Property taxes 33,272,981 - 33,272,981
Payment in lieu of taxes 2,403,565 - 2,403,565
Franchise & utility taxes 2,463,232 - 2,463,232
Local fuel tax 1,010,245 - 1,010,245
Transient room tax 1,356,155 - 1,356,155
Shared revenue 2,026,255 - 2,026,255
Investment earnings 1,557,790 1,176,791 2,734,581
Miscellaneous 1,351,036 48,355 1,399,391 Licenses permits and fees - 78,860 78,860
Transfers 67,548 (67,548) -
Total general revenues and transfers 45,508,807 1,236,458 46,745,265
Change in net position 2,159,686 5,514,621 7,674,307
Net position, beginning 127,480,387 93,386,125 220,866,512
Prior period adjustments (Note Q)8,383,703 - 8,383,703
Net position, beginning (as restated)135,864,090 93,386,125 229,250,215
Net position, ending 138,023,776$ 98,900,746$ 236,924,522$
The accompanying notes are an integral part of this statement.
Primary GovernmentProgram Revenues
Net (Expense) Revenue and Changes in Net Position
City of Springfield, Oregon
STATEMENT OF ACTIVITIES
For the Year Ended June 30, 2019
62Attachment 1, Page 62 of 218
SEDA Nonmajor Total
General Street Police Levy Glenwood Governmental Governmental
ASSETS
Cash and investments 12,137,623$ 1,782,088$ 1,997,096$ 772,242$ 15,523,437$ 32,212,486$
Receivables:
Accounts 1,480,542 1,041,815 66,935 650 345,901 2,935,843
Taxes 736,954 - 238,859 35,048 244,984 1,255,845
Grants - 22,632 - - 129,367 151,999
Accrued interest 56,325 5,072 8,032 6,759 46,809 122,997
Assessments and liens - - - - 61,697 61,697
Notes - - - - 1,340,772 1,340,772
Deferred system development charges 1,233 - - - 928,941 930,174
Inventory 1,974 261,081 - - - 263,055
Investment in foreclosed property 1,970 - - - - 1,970 Prepaid items 114,399 - 3,021 - 256,462 373,882
Total assets 14,531,020$ 3,112,688$ 2,313,943$ 814,699$ 18,878,370$ 39,650,720$
LIABILITIES, DEFERRED INFLOWS OF
RESOURCES, AND FUND BALANCES
Liabilities:
Accounts payable 783,923$ 140,008$ 119,191$ 9,825$ 243,870$ 1,296,817$
Accrued payroll and other liabilities 805,907 100,471 127,287 - 67,186 1,100,851
Unearned revenue 149,588 - - - - 149,588
Deposits - - - - 54,575 54,575
Total liabilities 1,739,418 240,479 246,478 9,825 365,631 2,601,831
Deferred inflows of resources:
Unavailable revenue 2,024,602 440,335 247,807 33,626 2,721,963 5,468,333
Fund balances:
Nonspendable 118,343 261,081 3,021 - 256,462 638,907
Restricted - 2,170,793 1,816,637 771,248 11,702,435 16,461,113
Committed 472,153 - - - 2,569,918 3,042,071
Assigned 1,000,000 - - - 1,261,961 2,261,961
Unassigned 9,176,504 - - - - 9,176,504
Total fund balances 10,767,000 2,431,874 1,819,658 771,248 15,790,776 31,580,556
Total liabilities, deferred inflows of
resources, and fund balances 14,531,020$ 3,112,688$ 2,313,943$ 814,699$ 18,878,370$
Reconciliation to the statement of net position
The statement of net position reports receivables at their net realizable value. However, receivables not available to pay for current period expenditures are deferred in governmental funds.5,468,333
Capital assets are not financial resources in governmental funds, but are reported in the statement of net
position at their net depreciable value.140,968,951
All liabilities are reported in the statement of net position. However, if they are not due and payable in the
current period, they are not recorded in the governmental funds.(64,059,237)
Internal service funds are proprietary-type funds and not reported with governmental funds. However,because internal service funds primarily benefit governmental activities, their assets, liabilities, and net
position are reported along with governmental activities in the statement of net position.24,065,173
Net position of governmental activities 138,023,776$
The accompanying notes are an integral part of this statement.
June 30, 2019
City of Springfield, Oregon
GOVERNMENTAL FUNDS
BALANCE SHEET
63Attachment 1, Page 63 of 218
City of Springfield, Oregon
GOVERNMENTAL FUNDS
Year Ended June 30, 2019
SEDA Nonmajor Total
General Street Police Levy Glenwood Governmental Governmental
Revenues:
Taxes 22,441,340$ 997,491$ 6,398,223$ 1,037,693$ 5,759,334$ 36,634,081$
Licenses, permits and fees 2,878,872 153,956 100,191 - 51,528 3,184,547
Intergovernmental 4,835,063 4,701,541 - 113,453 738,856 10,388,913
Charges for services 5,271,005 109,777 758,834 25,800 2,090,099 8,255,515
Fines and forfeitures 1,607,014 - - - 212,415 1,819,429
Investment earnings 459,938 41,519 65,348 54,418 396,465 1,017,688
Special assessments - - - - 17,098 17,098
Miscellaneous revenues 370,893 11,177 45,420 - 778,175 1,205,665
Total revenues 37,864,125 6,015,461 7,368,016 1,231,364 10,043,970 62,522,936
Expenditures:
Current operating:
General government 6,908,514 269,840 694,637 93,617 604,593 8,571,201
Fire and life safety 11,543,035 - - - 1,571,090 13,114,125
Police 14,609,663 - 6,040,244 - 465,802 21,115,709
Library 1,654,619 - - - 249,516 1,904,135
Development and public works 2,450,079 5,537,734 - - 1,640,565 9,628,378
Capital projects 477 - - 5,610,657 484,313 6,095,447
Debt service:
Principal - - - 576,673 1,445,000 2,021,673
Interest - - - 151,222 523,000 674,222
Total expenditures 37,166,387 5,807,574 6,734,881 6,432,169 6,983,879 63,124,890
Excess of revenues over
(under) expenditures 697,738 207,887 633,135 (5,200,805) 3,060,091 (601,954)
Other financing sources (uses):
Transfers in 759,803 436,006 - - 263,029 1,458,838
Transfers out (436,006) (150,000) - - (692,255) (1,278,261)
Total other financing sources (uses)323,797 286,006 - - (429,226) 180,577
Net change in fund balance 1,021,535 493,893 633,135 (5,200,805) 2,630,865 (421,377)
Fund balances, beginning 9,745,465 1,919,882 1,186,523 5,972,053 13,159,911 31,983,834
Change in reserve for inventories - 18,099 - - - 18,099
Fund balances, ending 10,767,000$ 2,431,874$ 1,819,658$ 771,248$ 15,790,776$ 31,580,556$
The accompanying notes are an integral part of this statement.
STATEMENT OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCES
64Attachment 1, Page 64 of 218
Net change in fund balances - total governmental funds (421,377)$
Amounts reported for governmental activities in the statement of activities are different
because:
Internal service funds are used by management to charge the costs of certain activities,
such as insurance, vehicle and equipment replacement, and SDC administration to
individual funds. The net revenue (expense) of certain internal service funds is reported
with governmental activities.971,359
Governmental funds defer revenues that do not provide current financial resources.
However, the Statement of Activities recognizes such revenues at their net realizable
value when earned, regardless of when received.(303,551)
Capital outlay is reported as expenditures in governmental funds. However, the
Statement of Activities allocates the cost of capital outlays over their esimated useful
lives as depreciation expense.2,982,693
Governmental funds do not report expenditures for unpaid compensated absences,
pension liability, or other post employment benefits since they do not require the use of
current financial resources. However, the statement of activities reports such expenses
when incurred, regardless of when settlement ultimately occurs. (2,807,850)
Proceeds from the issuance of long-term debt provide current financial resources to
governmental funds and are reported as revenues. In the same way, repayments of long-
term debt use current financial resources and are reported as expenditures in
governmental funds. However, neither the receipt of debt proceeds nor the payment of
debt principal affect the Statement of Activities, but are reported as increases and
decreases in noncurrent liabilities in the Statement of Net Position. Also, governmental
funds report the effect of premiums, discounts, and similar items when debt is first
issued, whereas these amounts are deferred and amortized in the statement of activities.
This amount is the net effect of these differences in the treatment of long-term debt and
related items.1,720,313
Decreases in inventory in governmental funds increase expenses.18,099
Change in net position of governmental activities 2,159,686$
The accompanying notes are are an integral part of this statement.
For the Year Ended June 30, 2019
City of Springfield, Oregon
Reconciliation of Statement of Revenues, Expenditures and
Changes in Fund Balances of Governmental Funds to the
Statement of Activities
65Attachment 1, Page 65 of 218
GovernmentalActivities
Nonmajor InternalStormServiceSewerDrainageAmbulanceBooth Kelly Total FundsASSETSCurrent assets:Cash and investments 24,337,030$ 19,604,818$ 1,447,082$ 1,531,345$ 46,920,275$ 21,664,430$ Accounts receivable, net of allowancefor estimated uncollectibles 1,218,534 1,196,759 1,924,039 9,987 4,349,319 59,187 Prepaids - - 36,478 - 36,478 42,514 Deposits - - - - - 200,000 Accrued interest 75,393 59,766 5,357 4,371 144,887 65,994 Deferred system development fees 599,528 48,541 - - 648,069 84,798 Inventory - - - - - 35,209
Total current assets 26,230,485 20,909,884 3,412,956 1,545,703 52,099,028 22,152,132 Noncurrent assets:Capital assets - net 55,500,075 11,855,201 22,183 1,377,185 68,754,644 5,371,589 Construction in progress 532,335 342,927 - - 875,262 - Land and land rights 2,048,070 1,685,809 - 2,641,557 6,375,436 - Due from other governments 1,549,275 - - - 1,549,275 -
Total noncurrent assets 59,629,755 13,883,937 22,183 4,018,742 77,554,617 5,371,589
Total assets 85,860,240 34,793,821 3,435,139 5,564,445 129,653,645 27,523,721
DEFERRED OUTFLOWS OF RESOURCESDeferred pension outflow 1,400,048 1,168,575 1,402,965 34,632 4,006,220 245,454 Deferred OPEB outflows 48,585 44,575 49,444 1,644 144,248 8,398 Deferred charge for debt refunding 679,062 - - - 679,062 -
Total deferred outflows of resources 2,127,695 1,213,150 1,452,409 36,276 4,829,530 253,852
LIABILITIESCurrent liabilities:Accounts payable 107,934 58,533 897,167 220 1,063,854 1,557,979 Accrued payroll and other liabilities 199,065 121,019 262,501 1,648 584,233 270,174 Accrued claims liabilities, current portion - - - - - 413,701 Accrued interest payable 107,250 62,825 - - 170,075 1,447 Deposits - - 65 46,639 46,704 5,286 Capital lease payable - current maturity - - - - - 146,970 Unearned revenues - 21 225,167 3,808 228,996 29,912 Revenue bonds payable - current maturity 1,280,000 460,000 - - 1,740,000 -
Total current liabilities 1,694,249 702,398 1,384,900 52,315 3,833,862 2,425,469
Noncurrent liabilities:Accrued absence payable 332,925 76,542 161,463 - 570,930 10,250 Accrued claims liabilities - - - - - 301,299 Revenue bonds payable (net of unamortized premium)10,978,983 6,598,581 - - 17,577,564 - Notes payable 505,833 - - - 505,833 - Net pension liability 3,703,366 3,165,467 3,705,493 97,691 10,672,017 653,430 Net OPEB obligation payable 308,286 290,664 567,488 11,399 1,177,837 58,219 Capital lease obligation - - - - - 150,385
Total noncurrent liabilities 15,829,393 10,131,254 4,434,444 109,090 30,504,181 1,173,583
Total liabilities 17,523,642 10,833,652 5,819,344 161,405 34,338,043 3,599,052
DEFERRED INFLOWS OF RESOURCESDeferred pension inflow 290,181 236,954 291,179 6,717 825,031 50,532 Deferred OPEB inflow 162,000 150,417 113,128 5,731 431,276 28,748
Total deferred inflows of resources 452,181 387,371 404,307 12,448 1,256,307 79,280
NET POSITIONNet investment in capital assets 46,500,558 6,825,355 22,183 4,018,741 57,366,837 5,074,234 Restricted for capital projects 4,822,072 1,753,233 - - 6,575,305 - Unrestricted 18,689,482 16,207,360 (1,358,286) 1,408,127 34,946,683 19,025,007
Total net position 70,012,112$ 24,785,948$ (1,336,103)$ 5,426,868$ 98,888,825 24,099,241$
Adjustment to reflect consolidation of internal service fund activities related to enterprise funds.11,921
Net position of business-type activities 98,900,746$
The accompanying notes are an integral part of this statement.
City of Springfield, Oregon
PROPRIETARY FUNDSSTATEMENT OF FUND NET POSITION
June 30, 2019
Business-type Activities - Enterprise Funds
66Attachment 1, Page 66 of 218
GovernmentalActivities
Nonmajor
Sewer Storm Drainage Ambulance Booth Kelly Total Internal Service Funds OPERATING REVENUESCharges for services 7,541,750$ 7,259,708$ 19,783,831$ 1,481,538$ 36,066,827$ 345,455$ Less: Contractual adjustments - - (12,780,341) - (12,780,341) - Licenses, permits and fees - - 78,860.00 - 78,860 12,365,190 Intergovernmental revenues - - 236,281 - 236,281 128,399 Miscellaneous revenue 628 36,942 10,785 - 48,355 220,676
Total operating revenues 7,542,378 7,296,650 7,329,416 1,481,538 23,649,982 13,059,720
Operating expenses:Human resources - - - - - 9,936,506 Finance 14,833 14,672 - - 29,505 22,551 Information technology 257,142 198,296 - - 455,438 203,435 Library - - - - - 7,261 Fire and life safety - - 7,249,819 - 7,249,819 58,555 Police - - - - - 289,227 Development and public works 3,561,957 5,070,889 - 450,920 9,083,766 889,942 Depreciation 2,917,992 433,590 8,390 828,698 4,188,670 1,210,143
Total operating expenses 6,751,924 5,717,447 7,258,209 1,279,618 21,007,198 12,617,620
Operating income (loss)790,454 1,579,203 71,207 201,920 2,642,784 442,100
Nonoperating revenues (expenses):Investment earnings 614,069 483,973 43,177 35,572 1,176,791 535,419 Interest expense (390,079) (228,622) - (21,732) (640,433) (9,547) Gain on disposal of equipment - - - - - (2,994)
Total nonoperating revenues (expenses)223,990 255,351 43,177 13,840 536,358 522,878
Income (loss) before contributions and transfers 1,014,444 1,834,554 114,384 215,760 3,179,142 964,978
Transfers out 32,022 (32,022) - (67,548) (67,548) - Capital contributions 1,235,767 1,304,738 - - 2,540,505 (113,029)
Change in net position 2,282,233 3,107,270 114,384 148,212 5,652,099 851,949
Net position, beginning of year 67,729,879 21,678,678 (1,450,487) 5,278,656 23,247,292
Net position, end of year 70,012,112$ 24,785,948$ (1,336,103)$ 5,426,868$ 24,099,241$
Adjustment to reflect the consolidation of internal service fund activities related to enterprise funds.(137,478)
Change in net position of business-type activities 5,514,621$
The accompanying notes are an integral part of this statement.
Business-type Activities - Enterprise Funds
City of Springfield, Oregon
PROPRIETARY FUNDS
STATEMENT OF REVENUES, EXPENSES AND CHANGES IN FUND NET POSITION
Year Ended June 30, 2019
67Attachment 1, Page 67 of 218
GovernmentalActivities
Nonmajor InternalStormServiceSewerDrainageAmbulanceBooth Kelly Total Funds
7,481,643$ 7,663,615$ 5,762,853$ 1,536,318$ 22,444,429$ 12,344,563$ (2,208,870) (3,339,666) (4,555,303) (76,286) (10,180,125) (633,308) (1,486,563) (2,123,592) (1,595,661) (368,181) (5,573,997) (10,158,862) 628 33,422 247,131 - 281,181 694,530
3,786,838 2,233,779 (140,980) 1,091,851 6,971,488 2,246,923
32,022 (32,022) - (67,548) (67,548) (113,029)
32,022 (32,022) - (67,548) (67,548) (113,029)
919,390 275,047 - - 1,194,437 - (861,988) (163,187) - - (1,025,175) (707,352) - - - - - (14,663) Contributed capital 0 7,988 - - 7,988 - (1,245,000) (450,001) - (739,418) (2,434,419) (143,635) (551,321) (258,050) - (26,027) (835,398) (10,246)
(1,738,919) (588,203) - (765,445) (3,092,567) (875,895)
609,916 482,881 45,225 34,925 1,172,947 536,397
2,689,857 2,096,435 (95,755) 293,783 4,984,320 1,794,396
21,647,173 17,508,383 1,542,837 1,237,562 41,935,955 19,870,034
24,337,030$ 19,604,818$ 1,447,082$ 1,531,345$ 46,920,275$ 21,664,430$
790,454$ 1,579,203$ 71,207$ 201,920$ 2,642,784$ 442,100$
2,917,992 433,590 8,390 828,698 4,188,670 1,210,143
(60,107) 127,414 (1,306,122) 59,850 (1,178,965) (20,627) Due from other governments (327,811) (3,520) - - (331,331) - Prepaid expenses - - (7,748) - (7,748) 53,925 11,810 (230,105) 781,005 (3,574) 559,136 443,723 (16,140) (6,613) (18,053) (538) (41,344) 15,534 - - - - - 7,000 549,598 405,073 424,173 13,152 1,391,996 70,313 (78,958) (71,284) (80,522) (2,587) (233,351) 29,912 - - 65 - 65 5,286 - 21 (13,375) (5,070) (18,424) - Inventory - - - - - (8,598)
3,786,838$ 2,233,779$ (140,980)$ 1,091,851$ 6,971,488$ 2,248,711$
315,643$ 1,021,703$ -$ -$ 1,337,346$ (113,029)$
System development chargesAcquisition and construction of capital assets Disposition of capital assets
Net OPEB obligation and related deferrals
Accounts payable
net cash provided by (used in) operating activities:
Net pension liability and related deferrals
Transfers to/from other funds
Net cash provided (used) by noncapital
Net cash used in capital and related
Accounts receivable
financing activities
financing activities
Changes in assets and liabilities: Depreciation
Principal paid on long-term debt
Deposits
Cash and investments, end of year
Reconciliation of operating income (loss) to
Operating income (loss) Adjustments to reconcile operating income (loss) to
Accrued payroll and other liabilities Accrued claims liabilities
Net cash provided by (used in) operating activities
Cash paid to suppliers for goods and services Other operating receipts
The accompanying notes are an integral part of this statement.
Unearned revenue
Net cash provided by (used in) operating activities
Contributed capital assets Noncash capital and related financing activities:
Cash flows from noncapital financing activities:
Cash flows from capital and related financing activities:
Cash flows from investing activities:
Net change in cash and investments
Cash and investments, beginning of year
Interest paid on long-term debt
Interest received
net cash provided by (used in) operating activities:
City of Springfield, Oregon
PROPRIETARY FUNDSSTATEMENT OF CASH FLOWS
Year Ended June 30, 2019
Business type activities - Enterprise Funds
Cash paid for employee services Cash received from customers Cash flows from operating activities: 68Attachment 1, Page 68 of 218
City of Springfield, Oregon
STATEMENT OF FIDUCIARY NET POSITION
AGENCY FUND
June 30, 2019
ASSETS
Cash and investments 85,969,318$
LIABILITIES
Amounts held for other parties 85,969,318$
The accompanying notes are an integral part of this statement.
69Attachment 1, Page 69 of 218
70Attachment 1, Page 70 of 218
City of Springfield, Oregon
NOTES TO FINANCIAL STATEMENTS Year Ended June 30, 2019
NOTE A – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES The financial statements of the City of Springfield (City) have been prepared in conformity with accounting principles generally accepted in the United States of America (GAAP) as applied to government units. The Governmental Accounting Standards Board (GASB) is the accepted standard-setting body for establishing
governmental accounting and financial reporting standards. The more significant accounting policies of the City are described below.
1. Financial Reporting Entity
The accompanying financial statements present the City of Springfield and its component unit. BLENDED COMPONENT UNIT The Springfield Economic Development Agency (SEDA) is a legally separate body, acting as the Urban Renewal Agency of the City of Springfield. Because the SEDA governing body is substantively the same as the City’s, and because City management is responsible for the Agency’s operations, the funds of the Agency are blended with those of the City by including them in the appropriate statements and schedules of this Comprehensive Annual Financial Report. Separate financial statements for the Agency can be obtained from the Finance Department of the City of Springfield or viewed on the City’s website at www.springfield-or.gov. 2. Government-wide and Fund Financial Statements The government-wide financial statements (i.e., the statement of net position and the statement of activities) report
information on all of the nonfiduciary activities of the City and its component units. For the most part, the effect of interfund activity has been removed from these statements. Governmental activities, which normally are supported by taxes and intergovernmental revenues, are reported separately from business-type activities, which rely to a
significant extent on charges for services for support. Likewise, the primary government is reported separately from certain legally separate component units for which the primary government is financially accountable.
The statement of activities demonstrates the degree to which the direct expenses of a given function or segment are offset by program revenues. Direct expenses are those that are clearly identifiable with a specific function or segment. Program revenues include 1) charges to customers or applicants who purchase, use, or directly benefit from goods, services, or privileges provided by a given function or segment and 2) grants and contributions that are restricted to meeting the operational or capital requirements of a particular function or segment. Taxes and other items not properly included among program revenues are reported instead as general revenues. Separate financial statements are provided for governmental funds, proprietary funds, and fiduciary funds, even though the latter are excluded from the government-wide financial statements. Major individual governmental funds and major individual enterprise funds are reported as separate columns in the fund financial statements.
3. Measurement Focus, Basis of Accounting and Financial Statement Presentation Measurement focus refers to what is being measured by a fund. Basis of accounting refers to when revenues and
expenditures or expenses are recognized in the accounts and reported in the financial statements.
71Attachment 1, Page 71 of 218
City of Springfield, Oregon
NOTES TO FINANCIAL STATEMENTS Year Ended June 30, 2019
NOTE A – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES – Continued The government-wide and proprietary fund financial statements are reported using the economic resources measurement focus and the accrual basis of accounting. Revenues are recorded when earned and expenses are recorded when a liability is incurred, regardless of the timing of related cash flows. Property taxes are recognized as revenues in the year for which they are levied. Grants and similar items are recognized as revenue as soon as all eligibility requirements imposed by the provider have been met. Governmental fund financial statements are reported using the current financial resources measurement focus and the modified accrual basis of accounting. Revenues are recognized as soon as they are both measurable and available. Revenues are considered to be available when they are collected within the current period or soon enough thereafter to pay liabilities of the current period. For this purpose, the government considers revenues to be available if they are collected within 30 days of the end of the year being reported. Expenditures generally are
recorded when a liability is incurred, as under accrual accounting. However, debt service expenditures, as well as expenditures related to compensated absences and claims and judgments, are recorded only when payment is due.
Property taxes, franchise fees, transient room taxes, and state shared revenues associated with the current fiscal period are all considered to be susceptible to accrual and so have been recognized as revenues of the current period when collected within 30 days following the year end. Expenditure-driven grants are recognized as revenue when the qualifying expenditures have been incurred and all other grant requirements have been met. All other revenue items are considered to be measurable and available only when cash is received. The fiduciary fund reported by the City, the Agency Fund, has no measurement focus and is reported on the full accrual basis of accounting. The financial transactions of the City are recorded in individual funds. Each fund is accounted for by providing a separate set of self-balancing accounts that comprise its assets, deferred outflows, liabilities, deferred inflows, fund equity, revenues, and expenditures/expenses. The various funds are reported by generic classification within the financial statements.
There are stated minimum criteria for the determination of major funds: percentage of the assets plus deferred outflows, liabilities plus deferred inflows, revenues or expenditures/expenses of either fund category, or the governmental and enterprise funds combined. The City electively added funds as major funds, those funds which
either had debt outstanding or specific community focus. Non-major funds are combined in a column in the fund financial statements and detailed in the combining section. The City reports the following major governmental funds: The General Fund is the City’s primary operating fund. It accounts for all financial resources of the general government, except those required to be accounted for in another fund. The Street Fund accounts for revenues from state gasoline taxes apportioned from the State of Oregon and expenditures as specified under Article IX, Section 3 of the constitution of the State of Oregon.
72Attachment 1, Page 72 of 218
City of Springfield, Oregon
NOTES TO FINANCIAL STATEMENTS Year Ended June 30, 2019
NOTE A – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES – Continued The Police Levy Fund accounts for revenue received from a five-year Police Local Option Levy to enhance public safety services by adding staff to the Police and Court Departments as well as funding jail operations. The SEDA Glenwood Fund accounts for revenue and expenses related to the redevelopment of the property located in the Glenwood Urban Renewal District. The City reports the following major proprietary funds: The Ambulance Fund accounts for the City’s ambulance operations. Revenue is derived mainly from ambulance fees. The fund also performs billing and collection of ambulance operations for other Oregon
cities. This service is provided for a fee. The Sewer Fund accounts for the operation, construction, and maintenance of the wastewater collection
system. Revenue is derived from sewer user fees and system development charges. The Storm Drainage Fund accounts for operation, construction, and maintenance of the stormwater drainage system. Revenue is derived from storm drainage fees and system development charges. Additionally, the government reports the following fund types: Internal Service funds account for the ownership and use of rolling stock and computer equipment, the City’s risk and employee benefit program, and costs related to the administration of system development charges. Resources are provided by charges to other funds, including component units. The Agency Fund is a fiduciary fund used to account for funds received and held by the City in a custodial capacity. The majority of the activity in this fund is made up of transactions related to being the fiscal agent for the Metropolitan Wastewater Management Commission and Regional Fiber Consortium,
Ambulance billing fees collected for other agencies, Health Reimbursement Accounts held on behalf of City employees, and fees collected by the municipal court that are passed on to other entities and government agencies.
As a general rule, the effect of interfund activity has been eliminated from the government-wide financial statements. Exceptions to this general rule include interfund services provided and/or used. Interfund services provided and/or used are accounted for as revenues and expenses since the elimination of such revenues and expenses would distort the direct costs and program revenues reported for the various functions. Accounts recorded as program revenues include charges to customers, operating grants and contributions, and capital grants and contributions. Internally dedicated resources are reported as general revenues rather than as program revenues. Likewise, general revenues include all taxes. Proprietary funds distinguish operating revenues and expenses from non-operating items. Operating revenues and
expenses generally result from providing services and producing and delivering goods in connection with a proprietary fund’s principal ongoing operations. The principal operating revenues of the Ambulance Fund are
73Attachment 1, Page 73 of 218
City of Springfield, Oregon
NOTES TO FINANCIAL STATEMENTS Year Ended June 30, 2019
NOTE A – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES – Continued ambulance fees and billing and collection charges. The principal operating revenues of the Sewer Fund are sewer user fees. The principal operating revenues of the Storm Drainage Fund are drainage fees. The principal operating revenues of the internal service funds are charges to other funds for depreciation on equipment and for services provided. Operating expenses for the enterprise funds and internal service funds include administrative expenses, depreciation on capital assets and the cost of providing services. All revenues and expenses not meeting this definition are reported as non-operating revenues and expenses. When both restricted and unrestricted resources are available for use, it is the City’s practice to use restricted resources first, then unrestricted resources as they are needed. 4. Assets, Liabilities, and Net Position or Equity
a. Cash and Investments
State statutes authorize the City to invest in obligations of the U.S. Treasury and its agencies, bankers’ acceptances, high grade commercial paper, the State of Oregon Local Government Investment Pool and repurchase agreements.
Investments are reported at fair value. For purposes of the statement of cash flows for proprietary fund types, cash and investments in the City-wide investment pool (including restricted cash and investments) are considered cash and cash equivalents. The pool has the general characteristics of a demand deposit account in that funds may deposit additional cash at any time and may withdraw cash at any time without prior notice or penalty. b. Receivables and Payables Activity between funds that are representative of lending/borrowing arrangements outstanding at the end of the
fiscal year are referred to as either “due to/from other funds (i.e., the current portion of interfund loans) or “advances to/from other funds” (i.e., the non-current portion of interfund loans). All other outstanding balances between funds are reported as “due to/from other funds.” Any residual balances outstanding between the
governmental activities and business-type activities are reported in the government-wide financial statements as “internal balances.”
Advances between funds, as reported in the fund financial statements, are offset by a nonspendable fund balance in applicable governmental funds to indicate that they are not available for appropriation and are not expendable available financial resources. Real and personal property taxes attach as an enforceable lien on property as of July 1st. All taxes are levied as of July 1st and are payable in three installments on November 15th, February 15th, and May 15th. All property taxes are billed and collected by Lane County, Oregon and then turned over to the City. For the year ended June 30, 2019, the City’s tax levy did not exceed the Oregon constitutional limitation. The total property tax levy was $34,341,345. This includes general property taxes to support general obligation bond debt service of $1,913,704.
74Attachment 1, Page 74 of 218
City of Springfield, Oregon
NOTES TO FINANCIAL STATEMENTS Year Ended June 30, 2019
NOTE A – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES – Continued The City has foreclosed on properties, collateralizing assessments receivable over the past twenty years. The properties collateralizing the assessments receivable, where the right to redemption still exists by the benefited property owner, are recorded as liens receivable, which include the cost of the original assessment, foreclosure costs and interest to the date of foreclosure, as provided by Oregon Statutes. Once the right to redeem these properties no longer exists (after one year), the properties are deeded to the City and then become investment in foreclosed property. Liens receivable and investment in foreclosed property are offset by unavailable revenue and, accordingly, have not been recorded as revenue in the governmental funds. The value of these properties, both liens and investment in foreclosed property, has been adjusted to the lower of net realizable value or cost. Net realizable value for the City has been determined by reviewing the true cash value of these properties as recorded by the Lane County assessor, less the underlying property taxes that must be paid
upon the sale of the property by the City. c. Inventory
Inventories of materials and supplies are valued at cost or average cost using the first-in/first-out method and are shown on the balance sheet as an asset with a corresponding nonspendable fund balance. Inventories are charged to
operations as consumed in both the government-wide and fund financial statements. d. Prepaid Items Payments made to vendors for services that will benefit periods beyond June 30, 2019 are recorded as prepaid items. These prepaid amounts are recorded in the balance sheet as an asset with a corresponding nonspendable fund balance and are shown as expenditures in the periods that the service is provided, consistent with the “consumption method” of accounting for prepaids. e. Restricted Assets
Assets whose use is restricted for construction, debt service or other purposes by provisions of grants, bond indentures or other agreements are segregated on the statement of net position.
f. Capital Assets Capital assets, which include property, plant, equipment and infrastructure assets (e.g., roads, multi-use paths and
traffic control devices), are reported in the applicable governmental or business-type activities columns in the government-wide financial statements. Capital assets are defined by the City as assets with an initial, individual cost of more than $5,000 and an estimated useful life greater than one year. Such assets are recorded at historical cost, or estimated historical cost if actual historical cost is not available. Donated capital assets, donated works of art and similar items, and capital assets received in a service concession arrangement are reported at acquisition value.
75Attachment 1, Page 75 of 218
City of Springfield, Oregon
NOTES TO FINANCIAL STATEMENTS Year Ended June 30, 2019
NOTE A – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES – Continued As permitted by GAAP, the City has limited the retroactive capitalization of governmental fund infrastructure to fiscal years ending after June 30, 1980. Although the majority of such infrastructure was placed in service before that date, it has not been included in these financial statements since it has been substantially depreciated. The costs of normal maintenance and repairs that do not add to the value of the asset or materially extend asset lives are not capitalized. Depreciation and amortization of capital assets are computed on the straight-line method over the estimated useful lives of the related assets. Upon disposal of such assets, the accounts are relieved of the related historical costs and accumulated depreciation, and resulting gains or losses are reflected in income. The estimated useful lives of the various categories of assets are as follows:
g. Compensated Absences It is the City’s policy to permit employees to accumulate earned but unused vacation leave within limits set by collective bargaining agreements. All employees with accrued vacation leave are paid the outstanding vacation accrual balance, within limits, at separation at the employees current pay rate. Employees with sick leave accruals and meeting longevity requirements are paid the outstanding sick leave accrual balance, within limits, upon retirement at the employees current pay rate. All vacation and sick leave pay is accrued when incurred in the government-wide and proprietary fund statements. The governmental fund financial statements do not report liabilities for compensated absences unless they are due for payment. The General Fund is the governmental fund that will be primarily used to liquidate compensated absences based on the high level of staffing that is funded from
this fund. h. Long-term Liabilities
In the government-wide financial statements and proprietary fund types in the fund financial statements, long-term debt and other long-term obligations are reported as liabilities in the applicable governmental activities, business-
type activities, or proprietary fund type statement of net position. Bond premiums and discounts are deferred and amortized over the life of the bonds. Bonds payable are reported net of the applicable bond premium or discount. Bond issuance costs are recognized in the year incurred. Deferred charges for refunding are amortized straight-line over the life of the new 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 while discounts on debt issuances are reported as other financing uses. Issuance costs, whether or not withheld from the actual debt proceeds received, are reported as debt service expenditures.
Category Estimated Useful Life
Buildings 10-50 years Equipment 3-20 years Infrastructure 20-50 years
Studies 20 years
76Attachment 1, Page 76 of 218
City of Springfield, Oregon
NOTES TO FINANCIAL STATEMENTS Year Ended June 30, 2019
NOTE A – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES – Continued i. Deferred Outflows/Inflows of Resources In addition to assets, the statement of financial position will sometimes report a separate section for deferred outflows of resources. This separate financial statement element, deferred outflows of resources, represents a consumption of net position that applies to a future period(s) and so will not be recognized as an outflow of resources (expense/expenditure) until then. In addition to liabilities, the statement of financial position will sometimes report a separate section for deferred inflows of resources. This separate financial statement element, deferred inflows of resources, represents an acquisition of net position that applies to a future period(s) and so will not be recognized as an inflow of resources (revenue) until that time.
The other instance of deferred inflows arises only under a modified accrual basis of accounting. Accordingly, unavailable revenue is reported only in the governmental funds balance sheet. These amounts are deferred and
recognized as an inflow of resources in the period that the amounts become available. j. Pensions
Oregon Public Employees Retirement System (OPERS) – For purposes of measuring the net pension liability, deferred outflows of resources and deferred inflows of resources related to pensions, and pension expense, information about the fiduciary net position of the OPERS and additions to/deductions from OPERS’s fiduciary net position have been determined on the same basis as they are reported by OPERS. For this purpose, benefit payments (including refunds of employee contributions) are recognized when due and payable in accordance with the benefit terms. Investments are reported at fair value. City Retirement Plan (CRP) – For purposes of measuring the net pension liability and pension expense, information about the fiduciary net position of CRP and additions to/deductions from CRP fiduciary net position have been determined on the same basis as they are reported by the City’s actuary. For this purpose, benefit payments are
recognized when due and payable in accordance with the benefit terms. Investments are reported at fair value. k. Fund Balance
In the fund financial statements, the fund balance for governmental funds is reported in classifications that comprise a hierarchy based primarily on the extent to which the City is bound to honor constraints on the specific purposes
for which amounts in those funds can be spent. Fund balance is reported as nonspendable when the resources cannot be spent because they are either in a nonspendable form or legally or contractually required to be maintained intact. Resources in nonspendable form include inventories, prepaids, and assets held for resale. Fund balance is reported as restricted when the constraints placed on the use of resources are either (a) externally imposed by creditors (such as through debt covenants), grantors, contributors, or laws or regulations of other governments; or (b) imposed by law through constitutional provisions or enabling legislation.
77Attachment 1, Page 77 of 218
City of Springfield, Oregon
NOTES TO FINANCIAL STATEMENTS Year Ended June 30, 2019
NOTE A – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES – Continued Fund balance is reported as committed when the City Council passes a resolution that places specific constraints on how the resources may be used. The City Council can modify or rescind the commitment at any time through passage of an additional resolution. Resources that are constrained by the City’s intent to use them for a specific purpose, but are neither restricted nor committed, are reported as assigned fund balance. Intent is expressed when the City Council approves which resources should be “reserved” during adoption of the annual budget. The City’s Finance Director uses that information to determine whether those resources should be classified as assigned or unassigned for presentation in the City’s Annual Financial Report. Unassigned fund balance is the residual classification for the General Fund. This classification represents fund
balance that has not been restricted, committed, or assigned within the General Fund. This classification is also used to report any negative fund balance amounts in other governmental funds.
When both restricted and unrestricted (committed, assigned, or unassigned) resources are available for use, it is the City’s practice to use restricted resources first, then unrestricted resources as needed. When an expenditure is incurred where an unrestricted fund balance classification could be used, the City’s practice is to use committed resources first, assigned resources second, and then unassigned amounts as they are needed. Fund balances by classification for the year ended June 30, 2019 were as follows:
Total
Police Glenwood Nonmajor Governmental
Fund Balances General Street Levy General Governmental Funds
Nonspendable:
Inventories 1,974$ 261,081$ -$ -$ -$ 263,055$
Prepaids 114,399 - 3,021 - 256,462 373,882
Investment in foreclosed property 1,970 - - - - 1,970
Restricted:
Debt service - - - - 400,482 400,482
Urban renewal - - - 771,248 893,089 1,664,337 Capital projects - - - - 1,574,749 1,574,749
Street repairs and maintenance - 2,170,793 - - - 2,170,793
Street improvements - - - - 3,841,302 3,841,302
Public Safety - Fire - - - - 654,870 654,870
Public Safety - Police general - - 1,816,637 - 78,749 1,895,386
Public Safety - Police forfeitures - - - - 279,118 279,118
Building code - - - - 2,290,690 2,290,690
Economic development - - - - 1,673,932 1,673,932
Library services - - - - 15,454 15,454
Committed:
Development assessment - - - - 523,663 523,663
Capital projects - - - - 2,046,255 2,046,255
Technology fee reserve 472,153 - - - - 472,153
Assigned:
Capital projects - - - - 762,227 762,227
Contigency reserve 1,000,000 - - - - 1,000,000
Public Safety - Police K9 - - - - 79,743 79,743
Public Saftey - Police general - - - - 256,317 256,317
Other purposes - - - - 163,674 163,674
Unassigned 9,176,504 - - - - 9,176,504
Total fund balances 10,767,000$ 2,431,874$ 1,819,658$ 771,248$ 15,790,776$ 31,580,556$
78Attachment 1, Page 78 of 218
City of Springfield, Oregon
NOTES TO FINANCIAL STATEMENTS Year Ended June 30, 2019
NOTE A – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES – Continued l. Indirect Expenses Allocation In the government-wide statement of activities, program costs include incidental indirect costs. m. Contingency and Working Capital Policy The City will maintain adequate cash reserves for both contingencies and working capital. Each fund will maintain adequate cash reserves, borrow internally from another City fund, or as a last resort, borrow externally to provide for cash flow and contingency requirements. 5. New Accounting Pronouncements
During the fiscal year ended June 30, 2019, the City implemented the following GASB pronouncements:
• GASB Statement No. 83 – Certain Asset Retirement Obligations. This statement addresses accounting and financial reporting for certain asset retirement obligations (AROs). An ARO is a legally enforceable liability associated with the retirement of a tangible capital asset. The adoption of Statement No. 83 resulted in the City
recognizing and disclosing its contractual obligation to remove a small building from a parcel of land that was traded to another local government entity. • GASB Statement No. 88 - Certain Disclosures Related to Debt, Including Direct Borrowings and Direct Placements. The objective of this Statement is to improve consistency in the information that is disclosed in notes to government financial statements related to debt, including direct borrowings and direct placements, and to provide financial statement users with additional essential information about debt. The adoption of Statement 88 resulted in the City providing additional disclosure about the portions of long term debt that were issued as direct placements. • GASB Statements No. 84, 87, 90 and 91 – These are other pronouncements that have been issued by the GASB
but not yet implemented by the City.
NOTE B – RECONCILIATION OF GOVERNMENT-WIDE AND FUND FINANCIAL STATEMENTS 1. Explanation of certain differences between the governmental fund balance sheet and the government-wide statement of net position. The governmental fund balance sheet includes a reconciliation between fund balance – total governmental funds and net position – governmental activities as reported in the government-wide statement of net position. One element of that reconciliation explains that “all liabilities are reported in the statement of net position, however if
they are not due and payable in the current period, they are not recorded in the governmental funds.” The details of this $64,059,237 difference are as follows:
79Attachment 1, Page 79 of 218
City of Springfield, Oregon
NOTES TO FINANCIAL STATEMENTS Year Ended June 30, 2019
NOTE B – RECONCILIATION OF GOVERNMENT-WIDE AND FUND FINANCIAL STATEMENTS – Continued
Another element of that reconciliation states that “capital assets are not financial resources in governmental funds, but are reported in the statement of net position at their net depreciable value.” The details of this $140,968,951 are as follows:
2. Explanation of certain differences between the governmental fund statement of revenues, expenditures, and changes in fund balances and the government-wide statement of activities. The governmental fund statement of revenues, expenditures, and changes in fund balances includes reconciliation between net changes in fund balances – total governmental funds and changes in net position of government activities as reported in the government-wide statement of activities. One element of that reconciliation explains that “Governmental funds report capital outlays as expenditures. However, in the statement of activities, the cost of
those assets is allocated over their estimated useful lives and reported as depreciation expense.” The details of this $2,982,693 difference are as follows:
Bonds payable, net of original issue premium and deferred charges 12,998,128$ Notes payable 3,720,292
Interfund loan payable 1,663,040 Due to developer 210,000
Accrued interest payable 38,767 Compensated absences 4,800,022 Net pension liability and related deferrals 34,854,432 Net OPEB obligation 5,774,556
Total 64,059,237$
Capital assets (net of accumulated depreciation) reported in the Statement of
Net Position - governmental activities column: Land and work in progress 75,234,210$ Other capital assets (net of accumulated depreciation)71,106,330
Total capital assets reported in internal service funds included in the Statement ofNet Position - governmental activities column (net of accumulated depreciation)(5,371,589)
140,968,951$
Capital outlay 5,946,355$
Donated capital assets 2,782,168 Depreciation (5,745,830)
Net adjustment to increase net changes in fund balances - total governmental funds to arrive at changes in net position of governmental activities 2,982,693$
80Attachment 1, Page 80 of 218
City of Springfield, Oregon
NOTES TO FINANCIAL STATEMENTS Year Ended June 30, 2019
NOTE B – RECONCILIATION OF GOVERNMENT-WIDE AND FUND FINANCIAL STATEMENTS – Continued Another element of that reconciliation states that “the issuance of long-term debt (e.g., bonds, leases) provides current financial resources to governmental funds, while the repayment of the principal of long-term debt consumes the current financial resources of governmental funds. Neither transaction, however, has any effect on net position. Also, governmental funds report the effect of premiums, discounts, and similar items when debt is first issued, whereas these amounts are deferred and amortized in the statement of activities.” The details of this $1,720,313 difference are as follows:
Another element of the reconciliation states that “governmental funds do not report expenditures for unpaid compensated absences or other post-employment benefits since they do not use current financial resources.” The details of this $(2,807,850) difference are as follows:
NOTE C – STEWARDSHIP, COMPLIANCE AND ACCOUNTABILITY The City follows these procedures in establishing the budgetary data reflected in the financial statements. In April of each year, the City Manager submits a recommended budget to the Budget Committee (which consists
of the City Council and an equal number of citizens of the City). The City’s budget is prepared for each fund on the modified accrual basis of accounting. Estimated receipts and expenditures are budgeted for by fund, program and object. Information on the past two year’s actual receipts and expenditures and current-year amended budgets are included in the budget document. The Budget Committee conducts public hearings for the purpose of obtaining citizens’ comments.
The Budget Committee then presents an approved budget to the City Council for final adoption. The adopted expenditures for each fund may not be increased by more than 10% during the year without a special public hearing
Principal repayment of general obligation debt 1,445,000$
Principal repayment of note payable 576,672 Amortization of deferred charges (35,034) Amortization of bond premiums 230,481
Increase in interfund loan payable (497,019) Decrease in accrued interest payable 213 Net adjustment to increase net changes in fund balances - total governmental funds to arrive at changes in net position of governmental activities 1,720,313$
Increase in accrued compensated absences (287,934)$ Increase in net pension liability and related deferrals (2,531,595)
Decrease in net OPEB obligation 11,679 Net adjust to increase net changes in fund balances - total governmental funds to arrive at changes in net position of governmental activities (2,807,850)$
81Attachment 1, Page 81 of 218
City of Springfield, Oregon
NOTES TO FINANCIAL STATEMENTS Year Ended June 30, 2019
NOTE C – STEWARDSHIP, COMPLIANCE AND ACCOUNTABILITY – Continued of the governing body with notice to the citizens published 5 to 30 days in advance. After the Council adopts the budget and certifies the total of ad valorem taxes to be levied, no additional tax levy may be made for that fiscal year. The City Council legally adopts the budget before July 1, by resolution. The resolution authorizes fund appropriations as current annual departmental requirements, debt service, capital projects, interfund transfers, interfund loans, statutory payments, contingencies, unappropriated fund balances and reserves. Expenditures cannot legally exceed appropriations at these control levels. Appropriations lapse as of the end of the year. The City Council may change the budget throughout the year by transferring appropriations between levels of control and by adopting supplemental budgets as authorized by Oregon Revised statutes. Management may
administratively transfer budget amounts between individual line items within the control level, but cannot make changes between the legal levels of control. During the fiscal year ended June 30, 2019, the City Council approved several transfer resolutions and supplemental budgets increasing appropriations by $9,585,813.
The Ambulance Fund reported a negative fund balance of $1,336,103. This negative fund balance was the result of the Fund not receiving the anticipated ambulance billing revenue in the current and prior fiscal year.
NOTE D – CASH AND INVESTMENTS The City of Springfield maintains a common cash and investment pool that is available for use by all funds. At June 30, 2019, cash and investments are comprised of the following: Cash on Hand $ 5,646 Cash with Fiscal Agent 5,500 Deposits 3,750,199
Local Government Investment Pool Accounts 90,415,362 Investments 92,589,802
$ 186,766,509
Each fund’s portion of this pool is displayed in the Statement of Net Position.
Governmental Funds $ 53,876,916 Business-type Funds 46,920,275 Not Appearing on Statement of Net Position Fiduciary Fund 85,969,318 $ 186,766,509
82Attachment 1, Page 82 of 218
City of Springfield, Oregon
NOTES TO FINANCIAL STATEMENTS Year Ended June 30, 2019
NOTE D – CASH AND INVESTMENTS - Continued Deposits Deposits with financial institutions are comprised of checking and money market accounts. As of June 30, 2019, the City of Springfield had a book balance of $3,750,199 and a bank balance of $4,281,664. The difference is due to transactions in process. Of this amount, $500,000 was covered by federal depository insurance, and the remainder was collateralized by the statewide pool. Effective July 1, 2008, the State of Oregon formed the Oregon Public Funds Collateralization Program under ORS 295. The collateralization program creates a statewide pool of qualified bank depositories for local governments, providing collateralization for bank balances that exceed the limits of federal depository insurance, and eliminating the need for certificates of participation. The legislation creates a shared liability structure for
depository banks, but does not guarantee that public funds are 100% protected. The City is also required to verify that amounts in excess of FDIC insurance limits are deposited only in qualified depository banks listed by the Office of the State Treasurer.
Local Government Investment Pool The City participates in the State of Oregon Local Investment Pool (LGIP or Pool) which is an open-ended, load diversified portfolio created under ORS 294.805 to 294.895 and is not registered with the U.S. Securities and Exchange Commission as an investment company. Fair value of the LGIP is calculated at the same value as the number of shares owned. The unit of account is each share held, and the value of the position would be the fair value of the pool’s share price multiplied by the number of shares held. The State Treasurer is the investment officer for the Pool and is responsible for all funds in the Pool. These funds must be invested and managed, like that of a prudent investor, exercising reasonable care, skill, and caution. Investments in the funds are further governed by portfolio guidelines issued by the Oregon short-term Funds Board, which establish diversification percentages and specify the types of maturities of investments. The Oregon Audits Division of the Secretary of State’s Office audits the Pool annually. The Division’s report on
the Pool as of and for the year ended June 30, 2019 was unmodified and may be obtained at the Oregon State Treasury, 350 Winter St. NE, Ste 100, Salem, OR 97310 or at www.ost.state.or.us. At June 30, 2019, the fair value of the City’s deposits with the LGIP approximates cost.
Cash and Investments On June 30, 2019, the City of Springfield held $92,589,802 of investments; corporate indebtedness of $33,497,980, and government agency securities totaling $59,091,822. The City’s investment policy requires that the City diversify investments across maturities, security type, and institution to avoid incurring unreasonable risks. Specifically, except for the Local Government Investment Pool, no more than 25% of the City’s total investment portfolio will be invested with a single financial institution, no more than 20% of the total portfolio will be invested with any one security, and lastly, no more than 5% of the total portfolio will be invested with any one corporate entity. The City was in compliance with all of the above stated City investment policy guidelines.
83Attachment 1, Page 83 of 218
City of Springfield, Oregon
NOTES TO FINANCIAL STATEMENTS Year Ended June 30, 2019
NOTE D – CASH AND INVESTMENTS - Continued The City’s policy for custodial credit risk is outlined in the City’s Investment and Portfolio Policies, adopted by the City Council. This investment policy applies to all cash-related assets included within the scope of the City of Springfield’s audited financial statements and held directly by the City. Funds will be invested in compliance with the provisions of, but not necessarily limited to the Oregon Revised Statutes (ORS), Chapter 295, other applicable statutes and this policy. Investment of any tax exempt borrowings proceeds and any related debt service funds will comply with the arbitrage restrictions in all applicable Internal Revenue Service codes. The City will limit investment activities in order to ensure safety, legality, liquidity, diversity, and yield. The standard of prudence used by the City’s investment officer in the context of managing the overall portfolio shall be the prudent investor rule. The scope of the City’s investment policy includes not only investments, but all cash-related assets included within
the scope of the City of Springfield’s financial statements and held directly by the City. The investment policy establishes the City’s permitted investments and provides guidelines for managing the various types of risk associated with these investments. The different risks will be discussed below.
A. Interest rate risk Interest rate risk is the risk that changes in interest rates will adversely affect the fair value of an investment. City staff manages this risk by limiting the maturity of the investments held by the City. The investment policy requires that all short-term investments mature in less than 18 months. The investment policy defines short-term investments as those not reserved for specific capital projects or debt payments. Long-term investments are required to have maturities less than 3 years. Commercial paper is required to have a maturity which does not exceed 270 days. On June 30, 2019, 100% of the total investments were considered short-term and had maturities less than 18 months and none were considered long-term with maturities of more than 18 months but less than 3 years. The table below displays the liquidity requirements of the investment policy and the liquidity characteristics of the City’s cash and investments on June 30, 2019. Short-Term Investments:
B. Credit risk Credit risk is the risk that an issuer or other counterparty to an investment will not fulfill its obligation. The City’s investment policy provides that all corporate debt securities be rated at a minimum of A1 or AA by Standard and Poor’s rating service or P1 or Aa by Moody’s rating service, or for an Oregon issuer, a minimum of A1 or A or better by S & P; or P1 or Aa by Moody’s. At June 30, 2019, all of the corporate debt in the City’s portfolio is in compliance with the investment policy. The Local Government Investment Pool is not rated and is not registered with the U.S. Securities and Exchange Commission.
Maturity Amount Actual % Investment Policy % Under 30 days $ 100,672,707 54% 10 % minimum Under 90 days 124,661,582 67% 25 % minimum Under 270 days 171,259,512 92% 50 % minimum Under one year 179,745,194 96% 80 % minimum Under 18 months 186,766,509 100% 100 % minimum
84Attachment 1, Page 84 of 218
City of Springfield, Oregon
NOTES TO FINANCIAL STATEMENTS Year Ended June 30, 2019
NOTE D – CASH AND INVESTMENTS - Continued C. Custodial credit risk Custodial credit risk is the risk that, in the event of the failure of the counterparty to a transaction, the City will not be able to recover the value of an investment or collateral securities in the possession of an outside party. The City’s investment policy requires that broker/dealers meet certain qualifications and that purchased investment securities will be delivered by FED book entry, DTC, or physical delivery, and held in third party safekeeping - registered to the City of Springfield - with a designated custodian. All of the City’s investments at June 30, 2019 were delivered by book entry to the account of BNY Western Trust Company, who held the securities for the benefit of the City. D. Concentration of credit risk
Concentration of credit risk is the risk of loss attributed to the magnitude of a government’s investment in a single issuer. The City’s investment policy provides concentration guidelines by both institution and by type of
investment. The City diversifies investments across maturities, security type and institution to avoid incurring unreasonable risks. In particular, except for the Local Government Investment Pool, no more than 25% of the City’s total investment portfolio will be invested with a single financial institution. In addition, no more than 20% of the total portfolio will be invested with any one security and no more than 5% of the total portfolio will be invested with any one corporate entity. As of June 30, 2019, the City was in compliance with the City’s investment policy. Diversification by Financial Instrument:
E. Fair Value Measurements Fair value is defined as the price that would be received at the sale of an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. The City categorizes fair value measurements within the hierarchy established by GASB Statement 72. This hierarchy defines three levels of inputs used to assess fair value which allows financial statement users to identify the level of reliability and determine variance risk between actual amounts received during a sale of assets or transfer of liabilities to that which is reported in the financial statements for the measurement date.
Maximum %
Instrument Amount % Invested of Portfolio
State of Oregon Investment Pool 90,415,362$ 48% 100%
Interest Bearing Checking Account 343,376 0% 50%
Money Market Account 3,406,823 2% 50%
Corporate Bonds 33,497,980 18% 25%
Municipal Bonds 59,091,822 32% 50%
Other 11,146 0% 0%
Totals 186,766,509$ 100%
85Attachment 1, Page 85 of 218
City of Springfield, Oregon
NOTES TO FINANCIAL STATEMENTS Year Ended June 30, 2019
NOTE D – CASH AND INVESTMENTS - Continued The classification of securities within this fair value hierarchy is based on activity level in the market for the security type, and the inputs used to determine their fair value as follows:
Level 1 – Unadjusted quoted prices for identical instruments in active markets.
Level 2 – Quoted prices for similar instruments in active markets; quoted prices for identical or similar instruments in markets that are not active; and model-derived valuations in which all
significant inputs are observable based on market data obtained from sources independent of the reporting entity.
Level 3 – Valuations derived from valuation techniques in which significant inputs are unobservable (based on the best information available regarding assumptions market participants would
use in pricing the asset). As of June 30, 2019, the City’s investments in corporate and municipal bonds are classified as level 2.
F. Foreign currency The City of Springfield has not made any investments that are not in US dollar denominations therefore the City is not exposed to this risk. NOTE E – RECEIVABLES AND UNAVAILABLE REVENUE
Assessments, liens, and mortgage notes are collateralized by real estate.
Receivables at June 30, 2019 consist of the following:
Property
Taxes and Assessments Accrued Mortgage SDC Deferred Total Net
Fund Other Accounts and Liens Grants Interest Notes Receivable Receivable
General 736,954$ 1,480,542$ -$ -$ 56,325$ -$ 1,233$ 2,275,054$
Street - 1,041,815 - 22,632 5,072 - - 1,069,519
Glenwood General 35,048 650 - - 6,759 - - 42,457
Police Levy 238,859 66,935 - - 8,032 - - 313,826
Sewer - 1,218,534 *- - 75,393 - 599,528 1,893,455
Storm Drainage - 1,196,759 *- - 59,766 - 48,541 1,305,066
Ambulance - 1,924,039 *- - 5,357 - - 1,929,396
Nonmajor governmental 244,984 345,901 61,697 129,367 46,809 1,340,772 928,941 3,098,471
Nonmajor enterprise - 9,987 - - 4,371 - - 14,358 Internal Service - 59,187 - - 65,994 - 84,798 209,979
1,255,845$ 7,344,349$ 61,697$ 151,999$ 333,878$ 1,340,772$ 1,663,041$ 12,151,581$
*Net of allowances for uncollectible accounts totalling $1,124,858
86Attachment 1, Page 86 of 218
City of Springfield, Oregon
NOTES TO FINANCIAL STATEMENTS Year Ended June 30, 2019
NOTE E – RECEIVABLES AND UNAVAILABLE REVENUE - Continued Mortgage notes within the Community Development fund are a result of loans made under the CDBG federal program. Repayment is dependent on the type of mortgage note. Deferred payment loans, housing improvement loans, and SHOP loans are due and payable at the time of sale or transfer of title. Most loans are interest free. In all cases, loans become immediately due and payable if the client fails to meet any contract requirements. Governmental funds report unavailable revenue in connection with receivables for revenues that are not considered to be available to liquidate liabilities of the current period. At June 30, 2019, the various components of unavailable revenue (deferred inflows) consist of the following:
Property Mortgage Total
taxes Fees and notes unavailable
FUND BY TYPE receivable charges receivable Assessments Other revenue
General 705,674$ 1,318,928$ -$ -$ -$ 2,024,602$
Street - 440,335 - - - 440,335
Police Levy 230,127 15,119 - - 2,561 247,807
Glenwood General 33,626 - - - - 33,626
Nonmajor governmental 238,878 1,157,582 1,176,280 61,698 87,525 2,721,963
Total unavailable revenue 1,208,305$ 2,931,964$ 1,176,280$ 61,698$ 90,086$ 5,468,333$
87Attachment 1, Page 87 of 218
City of Springfield, Oregon
NOTES TO FINANCIAL STATEMENTS Year Ended June 30, 2019
NOTE F – CAPITAL ASSETS
Governmental activities:
Beginning Ending
Balance Increases Decreases Balance
Capital assets, not being depreciated:
Land 67,615,125$ 6,469,436$ -$ 74,084,561$
Work in progress 2,499,103 5,793,687 (7,143,141) 1,149,649
Total capital assets, not being depreciated 70,114,228 12,263,123 (7,143,141) 75,234,210
Capital assets, being depreciated:
Buildings 48,545,552 16,669 (693,304) 47,868,917
Infrastructure 76,969,594 11,096,507 - 88,066,101
Machinery & equipment 23,702,305 1,782,726 (1,197,666) 24,287,365
Library books 1,998,269 - (1,998,269) -
Studies 1,078,154 16,083 - 1,094,237
Total capital assets, being depreciated 152,293,874 12,911,985 (3,889,239) 161,316,620
Less accumulated depreciation for:
Buildings (27,511,087) (2,282,241) 557,080 (29,236,248)
Infrastructure (39,959,111) (3,203,048) - (43,162,159)
Machinery & equipment (16,833,180) (1,404,901) 1,133,170 (17,104,911)
Library books (1,998,269) - 1,998,269 -
Studies (641,188) (65,784) - (706,972)
Total depreciation (86,942,835) (6,955,974) 3,688,519 (90,210,290)
Total capital assets, being depreciated, net 65,351,039 5,956,011 (200,720) 71,106,330
Governmental activities capital assets, net 135,465,267$ 18,219,134$ (7,343,861)$ 146,340,540$
Business-type activities:
Beginning Ending
Balance Increases Decreases Balance
Capital assets, not being depreciated:
Land 6,375,436$ -$ -$ 6,375,436$
Work in progress 638,802 1,007,967 (771,507) 875,262
Total capital assets, not being depreciated 7,014,238 1,007,967 (771,507) 7,250,698
Capital assets, being depreciated:
Buildings & infrastructure 111,473,516 2,108,853 (2,761) 113,579,608
Land improvements 532,806 - - 532,806
Equipment 2,118,325 19,970 (294,977) 1,843,318
Studies 1,872,456 - - 1,872,456
Total capital assets, being depreciated 115,997,103 2,128,823 (297,738) 117,828,188
Less accumulated depreciation for:
Land improvements (512,490) (1,243) - (513,733)
Buildings & infrastructure (41,723,851) (3,854,655) - (45,578,506)
Equipment (1,672,241) (199,456) 294,978 (1,576,719)
Studies (1,271,270) (133,316) - (1,404,586)
Total depreciation (45,179,852) (4,188,670) 294,978 (49,073,544)
Total capital assets, being depreciated, net 70,817,251 (2,059,847) (2,760) 68,754,644
Business-type activities capital assets, net 77,831,489$ (1,051,880)$ (774,267)$ 76,005,342$
88Attachment 1, Page 88 of 218
City of Springfield, Oregon
NOTES TO FINANCIAL STATEMENTS Year Ended June 30, 2019
NOTE F – CAPITAL ASSETS – Continued
Depreciation expense was charged to functions of the City as follows: Governmental activities: General government $ 177,675 Police 1,966,074 Fire and life safety 684,654 Development and public works 3,899,390 Library 20,329 Unallocated 207,852 Total depreciation expense – governmental activities 6,955,974
Business-type activities:
Sewer $ 2,917,992 Storm 433,590 Booth-Kelly 828,698
Ambulance 8,390
Total depreciation expense – business type activities $ 4,188,670
NOTE G - RISK MANAGEMENT
The City is exposed to various risks of loss related to torts, errors and omissions, loss or damage to assets, employee injury or illness, and natural disasters. The City maintains professional risk management and health and wellness programs. Various loss-control
techniques are used to minimize or prevent losses. These techniques and programs include but are not limited to: contracting for risk and benefit broker services, contracting for legal services, operation of a wellness clinic, accident investigation and training, fleet management, verification of employee qualifications, and employee and
supervisory training. The City has established an internal service fund to account for and finance its risks of loss. The City maintains a
self-insured health benefit program that provides medical, dental, and vision coverage to all regular full and part-time employees and their dependents as well as non-Medicare eligible retirees and their dependents. The City has established a self-insurance reserve to pay medical, dental, and vision claims up to the self-insurance retention limit
of $150,000 per covered individual.
89Attachment 1, Page 89 of 218
City of Springfield, Oregon
NOTES TO FINANCIAL STATEMENTS Year Ended June 30, 2019
NOTE G - RISK MANAGEMENT – Continued The following changes occurred in the health and dental claims liability in the current and previous fiscal years:
The City of Springfield is self-insured for workers’ compensation. The City estimates liability for incurred losses for reported and unreported claims for worker’s compensation. Workers’ compensation estimates are primarily based on individual case estimates for reported claims and through historical data for unreported claims as determined by the City’s Risk Management Services and independent actuarial studies. Liabilities are based on estimated ultimate cost of settling claims, including effects of inflation and other societal and economic factors.
The City purchases third-party coverage or is part of the City County Insurance Services Insurance Pool for all lines of coverage. These include but are not limited to personal injury, public officials’ errors and omissions, automobile, employer’s liability, and property. Settled claims have not exceeded insurance coverage in any of the past five fiscal years.
Liability Current year
Fiscal balance at claims and Liability
year ended beginning changes in Claim balance at
June 30 of year estimates Payments end of year
2013 -$ 2,256,826$ (1,791,735)$ 465,091$
2014 465,091 4,894,984 (4,960,500) 399,575
2015 399,575 6,007,389 (5,359,049) 1,047,915
2016 1,047,915 5,343,218 (5,895,677) 495,456
2017 495,456 5,771,608 (5,531,337) 735,727
2018 735,727 6,293,791 (6,292,611) 736,907
2019 736,907 6,417,464 (6,040,112) 1,114,259
IBNR &Net
Case IBNR Outstanding Closeout LCF after Outstanding
Year Reserves Reserves LCF Risk Adj.Closeout Liabilities
Prior 21,382$ -$ -$ -$ -$ 21,382$
2014-15 - - - - - -
2015-16 - 30,452 6,090 3,661 - 40,203
2016-17 58,722 33,829 18,510 7,634 - 118,695
2017-18 28,424 109,893 27,664 7,770 - 173,751
2018-19 187,916 117,167 61,016 7,660 - 373,759
Total 296,444$ 291,341$ 113,280$ 26,725$ -$ 727,790
Less investment income offset (12,790)
Net accrued claims liability 715,000$
Self-Insured Workers' Compensation Program
Estimated Liability for Unpaid Loss and LAE at June 30, 2019
90Attachment 1, Page 90 of 218
City of Springfield, Oregon
NOTES TO FINANCIAL STATEMENTS Year Ended June 30, 2019
NOTE H - CAPITAL LEASES The City purchased equipment in the fiscal year ending June 30, 2013 for $977,780 with no down payment and annual payments over 5 years. The City purchased equipment in the fiscal year ending June 30, 2016 for $125,452 with no down payment and annual payments over 5 years. The City purchased equipment in the fiscal year ending June 30, 2017 for $593,108 with no down payment and annual payments over 5 years. These lease agreements qualify as capital leases for accounting purposes and, therefore, have been recorded at the present value of their future minimum lease payments as of the inception date. These capital leases are classified as direct placements related to governmental activities (GASB statement No. 88). These leases contain a provision that in an event of default, all outstanding amounts become immediately due if the City is unable to make a payment and the equipment is held as collateral for the secured obligation.
NOTE I - LONG-TERM DEBT General Obligation Bonds
The City issues general obligation bonds to provide funds for the acquisition and construction of major capital facilities. General obligation bonds are backed by the full faith and credit of the City and are serviced by general property tax revenues. The original amount of general obligation bonds issued in prior years was $14,690,000. General obligation bonds payable transactions for the year ended June 30, 2019 are as follows:
The assets acquired through capital leases are as follows:
Machinery and equipment 1,696,340$
Less: Accumulated depreciation (632,233)
Total 1,064,107$
The future minimum lease obligations as of June 30, 2019, are as follows:
Fiscal Year Ending June 30, Principal Interest
2020 146,970$ 6,912$
2021 150,385 3,496
Totals 297,355$ 10,408$
Final Effective Outstanding Outstanding
Issue Maturity Interest July 1,Issued Retired June 30, Due Within
Date Date Rate 2018 During year During Year 2019 One Year
Series 2016 6/29/2016 2026 1.36% 13,075,000$ -$ (1,445,000)$ 11,630,000$ 1,505,000$
Unamortized premium 1,613,366
Due in current year (1,505,000)
Total general obligation long-term debt 11,738,366$
91Attachment 1, Page 91 of 218
City of Springfield, Oregon
NOTES TO FINANCIAL STATEMENTS Year Ended June 30, 2019
NOTE I - LONG-TERM DEBT – Continued Revenue Bonds The City issues revenue bonds to finance major construction projects in business-type activities. Revenue bonds are secured and serviced by system revenues. The original amount of revenue bonds issued in prior years was $23,610,000. The City has committed to establish utility user charges sufficient to pay principal and interest when due. If user charges are not sufficient, the City is required by covenant to raise utility rates sufficient to pay maturing principal and interest. Debt service on the revenue bonds is paid solely from user fees. Revenue obligation bonds payable transactions for the year ended June 30, 2019 are as follows:
Maturities of bond principal and interest are as follows:
`Final Effective Outstanding Outstanding
Issue Maturity Interest July 1,Issued Retired June 30, Due Within
Date Date Rate 2018 During year During Year 2019 One Year
Series 2010 10/6/2010 2030 3.149% 7,215,000$ -$ (450,000)$ 6,765,000$ 460,000$
Series 2017 6/27/2017 2027 1.725% 12,290,000 - (1,245,000) 11,045,000 1,280,000
Unamortized premium 1,507,564
Due in current year (1,740,000)
Total revenue bonds payable 17,577,564$
Year Principal Interest Principal Interest Principal Interest
2019-20 1,505,000$ 465,200$ 1,740,000$ 673,400$ 3,245,000$ 1,138,600$
2020-21 1,570,000 405,000 1,795,000 620,975 3,365,000 1,025,975
2021-22 1,625,000 342,200 1,860,000 553,700 3,485,000 895,900
2022-23 1,695,000 277,200 1,930,000 483,975 3,625,000 761,175
2023-24 1,765,000 209,400 2,005,000 408,900 3,770,000 618,300
2025-29 3,470,000 204,400 7,125,000 889,100 10,595,000 1,093,500
2030-31 - - 1,355,000 54,700 1,355,000 54,700
Total 11,630,000$ 1,903,400$ 17,810,000$ 3,684,750$ 29,440,000$ 5,588,150$
General Obligation Bonds Revenue Bonds Total
92Attachment 1, Page 92 of 218
City of Springfield, Oregon
NOTES TO FINANCIAL STATEMENTS Year Ended June 30, 2019
NOTE I - LONG-TERM DEBT – Continued The City issues debt backed solely by future fees received for certain services. At June 30, 2019, future pledged revenues are as follows:
The Springfield Economic Development Agency (SEDA) entered into two direct placement Notes Payable, one in 2016 and one in 2018. The Notes are not subject to any acceleration clauses and are not subject to finance related
consequences due to events of default. Both Notes are subject to covenants regarding continuing disclosure, prepayment fees and a variable interest rate which will reset in October 2021 based on the 3 year FHLB Des Moines Fixed-Rate Advances symmetrical index, plus 1.40 basis points. Both Notes also require that the SEDA
maintain an unrestricted net position of at least $125,000.
Approx %
Future pledged of future revenues Revenue, net of
Year end of revenue debt pledged to related expenses Debt payments 2019
Purpose Revenue Stream final payments outstanding gross revenues Y/E 6/30/2019 Y/E 6/30/2019 Gross Revenues
Revenue bonds:
Sewer System series 2017 Sewer system fees 2027 13,024,400$ 10.7%7,890,375$ *1,711,350$ 15,937,071
Revenue bonds:
Storm System series 2010 Sewer system fees 2030 8,470,350 4.4%7,890,375 *708,050
Business -type activities 21,494,750$ 2,419,400$
* same revenue source pledged for two purposes
Notes Payable
At June 30, 2019 notes payable are as follows:
Governmental activites:
Bank of Cascades (SEDA), payable in monthly installments including interest at 3.08%, due 2024 1,389,460$
Bank of Cascades (SEDA), payable in monthly installments
including interest at 4.15%, due 2025 2,330,833
Total governmental activities 3,720,293$
93Attachment 1, Page 93 of 218
City of Springfield, Oregon
NOTES TO FINANCIAL STATEMENTS Year Ended June 30, 2019
NOTE I - LONG-TERM DEBT – Continued Principal amounts due on these notes payable in each of the next five years and thereafter are as follows:
The contract payable included in governmental activities represents an amount due to Sycan B Corporation for a land purchase, with a due date to be established by mutual agreement of both parties. The contract payable included in business-type activities represents an amount due to Peacehealth. City gave Peacehealth a credit against future System Development Charges in return for Peacehealth constructing infrastructure that exceeded capacity requirements at the time the Riverbend Hospital was built, in anticipation of future development’s demand for that infrastructure.
Changes in Long-term Liabilities
Long-term liability activity for the year ended June 30, 2019 was as follows:
Governmental
Fiscal Year Activities
2019-20 567,965$
2020-21 619,807
2021-22 643,247
2022-23 667,592
2023-24 692,811
Thereafter 528,871
3,720,293$
94Attachment 1, Page 94 of 218
City of Springfield, Oregon
NOTES TO FINANCIAL STATEMENTS Year Ended June 30, 2019
NOTE I - LONG-TERM DEBT – Continued
Beginning Ending Due Within
Balance Additions Reductions Balance One Year
Governmental activities
General obligation bonds 13,075,000$ -$ (1,445,000)$ 11,630,000$ 1,505,000$
Less deferred amounts
for issuance premiums 1,843,847 - (230,481) 1,613,366 -
Total bonds payable 14,918,847 - (1,675,481) 13,243,366 1,505,000
Notes payable 4,296,965 - (576,672) 3,720,293 567,965
Deferred system development fees 1,166,022 497,018 - 1,663,040 -
Contracts payable 210,000 - - 210,000 -
Capital leases 440,990 - (143,635) 297,355 146,970
Accrued claims liability 708,000 7,000 - 715,000 413,701
Compensated absences 4,529,134 1,667,911 (1,450,292) 4,746,754 1,549,550
Net OPEB liability 5,876,476 - (468,158) 5,408,318 -
Net pension liability 41,730,526 3,267,821 - 44,998,347 -
Governmental activity
long-term liabilities 73,876,960$ 5,439,750$ (4,314,238)$ 75,002,473$ 4,183,186$
Business-type activities:
Bonds payable:
Revenue bonds 19,505,000$ -$ (1,695,000)$ 17,810,000$ 1,740,000$
Less deferred amounts
for issuance premiums 1,685,522 - (177,958) 1,507,564 -
Total bonds payable 21,190,522 - (1,872,958) 19,317,564 1,740,000
Notes payable 739,418 - (739,418) - -
Contracts payable 506,567 - (734) 505,833 -
Compensated absences 963,756 287,145 (363,025) 887,877 329,130
Net OPEB liability 1,411,189 - (159,812) 1,251,377 -
Net pension liability 9,679,297 992,720 - 10,672,017 -
Business-type activities
long-term liabilities 34,490,749$ 1,279,865$ (3,135,947)$ 32,634,668$ 2,069,130$
95Attachment 1, Page 95 of 218
City of Springfield, Oregon
NOTES TO FINANCIAL STATEMENTS Year Ended June 30, 2019
NOTE J – RECEIVABLES AND PAYABLES WITHIN THE REPORTING ENTITY Interfund Payables & Receivables
The balances shown above are for services rendered and are generally paid within 30 days. In an effort to encourage development within the two urban renewal districts, the Springfield Economic Development Agency (SEDA) implemented a program to pay the system development fees on any new commercial
or industrial development within the boundaries of the two districts. Additionally, the City has agreed to defer payment from SEDA up to the date the Agency sunsets. That date is not defined and is dependent on the Agency accomplishing its stated goals. The earliest it would reasonably sunset is late 2024. Being a noncash transaction and due to the uncertainty and timing of the payments, authoritative accounting standards indicate that no transaction would need to be recorded (GASB statement No. 34, paragraph 112a(1)). However, due to the size of these deferred payments and impact they would have on affected funds, the City has chosen to recognize a
receivable and deferred revenue in the governmental funds statements and a receivable and revenue in the government-wide and proprietary fund statements. For the offsetting liability, a corresponding expense and liability has been recognized in the government-wide statements, however, no expenditure or corresponding liability has been recognized in the governmental funds statements. The details of theses deferred fees are as follows:
Receivable Fund Payable Fund Amount Sewer SEDA Glenwood $ 470,826
Sewer SEDA Downtown 128,702 Storm Drainage SEDA Glenwood 48,219 Storm Drainage SEDA Downtown 322 Total advance to/from other funds (different fund types) $ 648,069
Receivable Fund Payable Fund Amount
General SEDA Glenwood $ 1,234 Building Code SEDA Glenwood 25
Street Capital SEDA Glenwood 626,306 Street Capital SEDA Glenwood 302,608
Internal Service Funds SEDA Glenwood 63,216 Internal Service Funds SEDA Downtown 21,582
Total due to/from other funds (similar fund types) $ 1,014,971
Receivable Fund Payable Fund Amount
Sewer Internal service funds (120,107)$
Storm Drainage Internal service funds 9,924
Booth Kelly Internal service funds 23,197
Ambulance Internal service funds 98,907
Total due to/from other funds (different fund types)11,921$
96Attachment 1, Page 96 of 218
City of Springfield, Oregon
NOTES TO FINANCIAL STATEMENTS Year Ended June 30, 2019
NOTE J – RECEIVABLES AND PAYABLES WITHIN THE REPORTING ENTITY - Continued Interfund Transfers
Transfers are routinely made for the following purposes: To move unrestricted revenues collected in the General Fund to finance various programs and activities accounted for in other funds in accordance with budgetary authorizations.
To move unrestricted revenues collected in other funds to the General Fund to finance government programs.
To move revenues appropriated for debt service from the funds collecting the receipts to the debt service fund as debt service payments become due.
To move revenues from the fund the statute or budget requires to collect them in to the fund the statute or budget requires to expend them.
NOTE K – REBATABLE ARBITRAGE The City has one general obligation bond payable. The Series 2016 bond, originally issued for $14,690,000, has no arbitrage liability as of June 30, 2019.
The City has two revenue bonds payable. The Sewer Series 2017 bond, originally issued for $13,610,000 and the Storm System Series 2010 bond, originally issued for $10,000,000 have no arbitrage liability as of June 30, 2019. NOTE L – CITY DEFINED BENEFIT PENSION PLAN Plan Description – The City sponsors a pension plan for Springfield Police Association employees hired before April 1, 1996 (City of Springfield, Oregon Retirement Plan – CRP). CRP is a governmental single-employer plan maintained and operated by the City of Springfield. The plan is closed to new entrants and all participants are fully vested. The CRP covers full-time regular employees covered by the Springfield Police Association, Fire management, and all Police management employees hired before April 1, 1996, and all disability retirees formerly in the Money Purchase Pension Plan. As of June 30, 2019, there were 25 participants in the plan, of which 14 are active employees and 11 are inactive employees or their beneficiaries. The CRP is subject to Oregon PERS “equal
Nonmajor Total
Governmental Sanitary Transfers
Fund description General Street Funds Sewer Out
General -$ 436,006$ -$ -$ 436,006$
Street - - 150,000 - 150,000
Nonmajor Governmental 692,255 - - - 692,255
Storm Drainage - - - 32,022 32,022
Nonmajor Enterprise 67,548 - 113,029 - 180,577
Total Transfers In 759,803$ 436,006$ 263,029$ 32,022$ 1,490,860$
97Attachment 1, Page 97 of 218
City of Springfield, Oregon
NOTES TO FINANCIAL STATEMENTS Year Ended June 30, 2019
NOTE L – CITY DEFINED BENEFIT PENSION PLAN – Continued to or better than” statutory requirements. PERS completed its latest “equal to or better than” testing in July of 2005. The most recent testing prior to July 2005 was in 1995. The plan does not issue a separate stand-alone report. City Retirement Plan Benefits
Pension Benefits – The City will contribute, as an employer’s contribution to an individual’s retirement account, a percentage of pay for all annual covered salary. The current percentage is 12.8% for sworn public safety employees, 10% for police dispatchers and 7% for other union employees. In addition, the City contributes 6% of salaries as employee contributions. The annual interest earnings to be credited to plan participants’ accounts remains at a guarantee of 9% for emergency service employees while employed with the City, but includes
additional provisions on the withdrawal of individual retirement funds once employment is terminated. Police management employees accepted the same terms and conditions for their participation in the CRP.
Distribution of Benefits – Upon severance of employment of a participant other than by death, a participant’s vested account balances shall be distributed to the participant as soon as administratively feasible. Participants who retired prior to June 30, 2006 could elect to leave their account balances in the plan up until the age of 70-1/2 with a 9%
interest guarantee. Participants that terminate employment with the City subsequent to June 30, 2006 and have reached the age of 50 may elect to leave their account balances in the plan up until the age of 70-1/2 with a 9% interest guarantee the 1st year, 6% for years 2 and 3, 4% for years 4 and 5, and 0% thereafter. For participants who terminate employment with the City after June 30, 2006 and before the age of 50, the interest guarantee is 9% for the 1st year and 0% thereafter. All distributions must be lump sum.
Death Benefits – Upon the death of a participant, the participant’s vested account balances shall be distributed to the participant’s beneficiary no later than one year after the date of death.
Disability Benefits – A participant who becomes permanently disabled while employed by the City so that the participant is unable to perform all essential duties will continue to earn credits for service up through the earlier of
age 60, death, or the date the participant is no longer disabled. Participant accounts will be distributed at the earlier of age 65 or death. Contributions – The CRP is funded through a tax-exempt trust that holds assets and funds benefits for the plan. The assets of the CRP are held for the exclusive benefit of participants and beneficiaries under the terms of the plan and cannot be used to pay any benefits or expenses of any other retirement plan or trust. The benefits are funded by
employer contributions and earnings from plan investments. The City’s Council adopted a formal CRP Funding Policy in 2015 that established a policy to systematically fund the liabilities of the plan on a sound actuarial basis, taking into account the closed status of the plan. The funding policy may be amended by the City Council at any time for any reason.
98Attachment 1, Page 98 of 218
City of Springfield, Oregon
NOTES TO FINANCIAL STATEMENTS Year Ended June 30, 2019
NOTE L – CITY DEFINED BENEFIT PENSION PLAN – Continued The City completes an actuarial study of the CRP as of June 30 every two years. In part, because of the closed membership nature of the plan, the City has implemented a new funding strategy for the CRP. The City now contributes annually to the plan a consistent percentage for all covered salary across all employee groups and an annual single lump sum in each year of the bi-annual cycle. The percentage contribution for all covered salary is now 30.0%. The annual lump sum contribution for the current bi-annual period is $991,000. Employer contributions for the year ended June 30, 2019 were $1,842,671. The General Fund is the governmental fund that will be used to liquidate the net CRP pension liability. Pension Assets, Liabilities, Pension Expense, and Deferred Outflows of Resources and Deferred Inflows of Resources Related to Pensions – At June 30, 2019, the City reported a net pension liability of $10,084,394. The
net pension liability and fiduciary net position were measured as of June 30, 2019. The total pension liability was determined using actuarial valuation results as of July 1, 2018 rolled forward to June 30, 2019. The following table presents the changes in the net pension liability for the fiscal year ended June 30, 2019:
Changes in Net Pension Liability Total Pension
Liability
Plan Fiduciary
Net Position
Net Pension
Liability
Balances as of June 30, 2018 30,694,901$ 20,438,552$ 10,256,349$
Changes for the year:
Service cost 409,467 - 409,467
Interest on total pension liability 1,942,409 - 1,942,409
Effect of plan changes - - -
Effect of economic/demographic (gains) or losses (606,741) - (606,741)
Effect of assumptions changes or inputs 1,241,053 - 1,241,053
Benefit payments (2,442,290) (2,442,290) -
Administrative expenses - (71,812) 71,812
Net investment income - 1,387,284 (1,387,284)
Employer contributions - 1,842,671 (1,842,671)
Net changes 543,898 715,853 (171,955)
Balances as of June 30, 2019 31,238,799$ 21,154,405$ 10,084,394$
99Attachment 1, Page 99 of 218
City of Springfield, Oregon
NOTES TO FINANCIAL STATEMENTS Year Ended June 30, 2019
NOTE L – CITY DEFINED BENEFIT PENSION PLAN – Continued For the year ended June 30, 2019, the City recognized pension expense of $1,081,072, the details of which are presented in the following table:
At June 30, 2019, the City reported deferred outflows of resources related to pensions from the following sources:
The $849,806 net deferred inflows/outflows of resources related to pensions will be recognized as pension expense as follows:
Pension Expense
July 1, 2018 to
June 30, 2019
Service cost 409,467$
Interest on total pension liability 1,942,409
Administrative expenses 71,812
Expected investment return net of investment expenses (1,105,656)
Recognition of Deferred (Inflows)/Outflows of Resources:
Recognition of economic/demographic (gains) losses (506,190)
Recognition of assumption changes or inputs 304,369
Recognition of investment (gains) losses (35,139)
Pension Expense 1,081,072$
Deferred Inflows/Outflows of Resources
Differences between expected and actual experience (1,013,269)$ -$ Changes of assumptions or inputs - 976,065
Net difference between projected and actual earnings (812,602) -
Total (1,825,871)$ 976,065$
Deferred Inflows
of Resources
Deferred Outflows
of Resources
Year Ending
June 30, Amount
2020 (362,049)$
2021 (456,301)
2022 (19,388)
2023 (12,068) 2024 -
Thereafter - Total (849,806)$
100Attachment 1, Page 100 of 218
City of Springfield, Oregon
NOTES TO FINANCIAL STATEMENTS Year Ended June 30, 2019
NOTE L – CITY DEFINED BENEFIT PENSION PLAN – Continued Actuarial Valuations – The total pension liability in the July 1, 2018 actuarial valuation rolled forward to June 30, 2019 was determined using the following actuarial assumptions:
Discount Rate – The Plan’s fiduciary net position plus anticipated future contributions in adherence with the funding policy is projected to be available to make all projected future benefit payments of current active and inactive employees. Therefore, the discount rate for calculating the total pension liability is equal to the long-term expected rate of return of 5.5%. Sensitivity of the City's proportionate share of the net pension liability to changes in the discount rate – The following presents the City's proportionate share of the net pension liability calculated using the discount rate of 5.5%, as well as what the City's proportionate share of the net pension liability would be if it were calculated using a discount rate that is 1-percentage-point lower (4.5%) or 1-percentage-point higher (6.5%) than the current rate:
Long-Term Expected Rate of Return – To help select the long-term expected rate of return assumption, the plan’s actuary, Milliman Inc, reviewed the plan’s asset allocation as of the most recent July 1, 2018 valuation date. The table below shows Milliman’s assumptions for the general asset classes in which the plan was invested at that
Actuarial Valuation Assumptions
Valuation date June 30, 2018 rolled forward to June 30, 2019.
Actuarial cost method Individual entry age normal, level percentage of base salary
Amortization method Fixed amortization period of 18 years starting July 1, 2018, with
payments calculated in level dollar installments.
Asset valuation method Five-year smoothing of market value investment gains and
losses, with the resulting smoothed asset value within 10% of
market value.
Actuarial assumptions:
Investment rate of return 5.50%
Projected salary increases 3.0% per year for wage inflation with merit increases
Administrative expenses $50,000 per year
Mortality None assumed
Sensitivity Current 1% Decrease Discount Rate 1% Increase
(4.50%)(5.50%)(6.50%)
Total pension liability 32,681,177$ 31,238,799$ 29,875,216$
Fiduciary net position 21,154,405 21,154,405 21,154,405
Net pension liability 11,526,772$ 10,084,394$ 8,720,811$
101Attachment 1, Page 101 of 218
City of Springfield, Oregon
NOTES TO FINANCIAL STATEMENTS Year Ended June 30, 2019
NOTE L – CITY DEFINED BENEFIT PENSION PLAN – Continued time. Each asset class return assumption is based on a consistent set of underlying assumptions, and includes adjustment for the inflation assumption. These assumptions are not based on historical returns, but instead are based on a forward-looking capital market economic model.
Asset Class
Allocation
Compound Annual
Return (20-Year
Geometric)
Cash 2.0% 2.53%
Core Fixed Income 38.5% 4.00%
Broad US Equities 18.7% 5.39%
Large Cap US Equities 18.3% 5.35%
Small Cap US Equities 7.5% 5.67%
Developed Economy Foreign Equities 12.0% 5.76%
Emerging Markets Equity 3.0% 6.43%
Assumed Inflation – Mean 2.30%
NOTE M – PERS DEFINED BENEFIT PENSION PLAN Plan Description – Qualifying employees of the city, consisting of police public safety personnel – covered by the
Springfield Police Association (SPA) – and fire public safety personnel, hired on or after April 1, 1996, as well as all general service personnel beginning April 1, 2002, are provided pensions through the Oregon Public Employees Retirement System (OPERS). These pensions are part of a cost-sharing multiple-employer defined benefit plan
administered and managed by the Public Employees Retirement System Board. All related benefits were established by the legislature pursuant to ORS Chapters 238 and 238A. OPERS issues a publicly available Comprehensive Annual Financial Report and Actuarial Valuation that can be obtained at
http://www.oregon.gov/pers/Pages/Financials/Actuarial-Financial-Information.aspx, or by calling (888) 320-7377, or by writing the Oregon Public Employees Retirement System at PO Box 23700, Tigard, Oregon 97281-3700.
Tier One/Tier Two Plan Benefits Pension Benefits – This pension program (ORS Chapter 238A) is closed to new members hired on or after
August 29, 2003. The PERS retirement allowance is payable monthly for life. It may be selected from 13 retirement benefit options. These options include survivorship benefits and lump-sum refunds. The basic benefit is based on years of service and final average salary. A percentage (2% for police and fire employees, 1.67% for general service employees) is multiplied by the number of years of service and the final average salary. A member is considered vested and will be eligible at minimum retirement age for a service retirement allowance if he or she has had a contribution in each of five calendar years or has reached at least 50 years of age before ceasing employment with a participating employer (age 45 for police and fire). General Service members may retire after
102Attachment 1, Page 102 of 218
City of Springfield, Oregon
NOTES TO FINANCIAL STATEMENTS Year Ended June 30, 2019
NOTE M – PERS DEFINED BENEFIT PENSION PLAN – Continued reaching age 55. Police and fire members are eligible after reaching age 50. Tier One general service member benefits are reduced if retirement occurs prior to age 58 with fewer than 30 years of service. Police and fire member benefits are reduced if retirement occurs prior to age 55 with fewer than 25 years of service. Tier Two members are eligible for full benefits at age 60. Death Benefits – Upon the death of a non-retired member, the beneficiary receives a lump-sum refund of the member’s account balance (accumulated contributions and interest). In addition, the beneficiary will receive a lump-sum payment from employer funds equal to the account balance, provided one or more of the following conditions are met:
the member was employed by a PERS employer at the time of death,
the member died within 120 days after termination of PERS-covered employment,
the member died as a result of injury sustained while employed in a PERS-covered job, or
the member was on an official leave of absence from a PERS-covered job at the time of death.
Disability Benefits – A member with 10 or more years of creditable service who becomes disabled from other than duty-connected causes may receive a non-duty disability benefit. A disability resulting from a job-incurred injury
or illness qualifies a member (including PERS judge members) for disability benefits regardless of the length of PERS-covered service. Upon qualifying for either a non-duty or duty disability, service time is computed to age 58 (55 for police and fire members) when determining the monthly benefit.
Benefit Changes After Retirement – Members may choose to continue participation in a variable equities investment account after retiring and may experience annual benefit fluctuations due to changes in the market value of equity
investments. Under ORS 238.360 monthly benefits may change annually through cost-of-living adjustments. Under current law, the cap on the COLA in fiscal year 2014 and beyond will vary based on 1.25% on the first $60,000 of annual benefit and 0.15% on annual benefits above $60,000. OPSRP Plan Benefits Pension Benefits – This Pension Program (ORS Chapter 238A) provides benefits to members hired on or after August 29, 2003. This portion of OPSRP provides a life pension funded by employer contributions. Benefits are calculated with a formula for members who attain normal retirement age; for Police and Fire, age 60 or 53 with 25 years of retirement credit, 1.8% is multiplied by the number of years of service and the final average salary; for General Service, age 65 or 58 with 30 years of retirement credit, 1.5% is multiplied by the number of years of service and the final average salary. To be classified as a police and fire member, the individual must have been employed continuously as a police and
fire member for at least five years immediately preceding retirement. A member of the OPSRP Pension Program becomes vested on the earliest of the following dates: the date the member completes 600 hours of service in each of five calendar years, the date the member reaches normal retirement age, and, if the pension program is
terminated, the date on which termination becomes effective.
103Attachment 1, Page 103 of 218
City of Springfield, Oregon
NOTES TO FINANCIAL STATEMENTS Year Ended June 30, 2019
NOTE M – PERS DEFINED BENEFIT PENSION PLAN – Continued
Death Benefits – Upon the death of a non-retired member, the spouse – or other person who is constitutionally required to be treated in the same manner as the spouse – receives, for life, 50% of the pension that would otherwise have been paid to the deceased member. The surviving spouse, or other person may elect to delay payment of the death benefit, but payment must commence no later than December 31 of the calendar year in which the member would have reached 70 ½ years.
Disability Benefits – A member who has accrued 10 or more years of retirement credits before the member becomes disabled, or a member who becomes disabled due to job-related injury, shall receive a disability benefit of 45% of the member’s salary determined by the last full month of employment before the disability occurred.
Benefit Changes After Retirement – Under ORS 238A.210, post retirement monthly benefits will change annually
through cost-of-living adjustments. Under current law, the cap on the COLA in fiscal year 2018 and beyond will vary based on 1.25% on the first $60,000 of annual benefit and 0.15% on annual benefits above $60,000. Contributions – PERS funding policy provides for monthly employer contributions at actuarially determined rates. These contributions, expressed as a percentage of covered payroll, are intended to accumulate sufficient assets to pay benefits when due. This funding policy applies to the PERS Defined Benefit Plan and Other Postemployment Benefit Plans. Employer contribution rates during the period were based on the December 31, 2016 actuarial valuation. The City contribution rates in effect for the fiscal year ended June 30, 2019 were 16.85% for Tier One/Tier Two covered members, 13.08% for OPSRP Pension Program Police and Fire Members, and 8.31% for OPSRP Pension Program General Service Members. Employer contributions for the year ended June 30, 2019 were $4,190,470. The General Fund is the governmental fund that will be primarily used to liquidate the net PERS pension liability based on the high level of staffing that is funded from this fund. Pension Assets, Liabilities, Pension Expense, and Deferred Outflows of Resources and Deferred Inflows of Resources Related to Pensions – At June 30, 2019, the City reported a liability of $45,585,971 for its proportionate share of the net pension liability. The net pension liability was measured as of June 30, 2018, and the
total pension liability used to calculate the net pension liability was determined by an actuarial valuation as of December 31, 2016 rolled forward to June 30, 2018. The City's proportion of the net pension liability was based on a projection of the City's long-term share of contributions to the pension plan relative to the projected contributions of all participating entities, actuarially determined. At June 30, 2018, the City's proportion was 0.3009%, which was changed from 0.3053% measured as of June 30, 2017. For the year ended June 30, 2019, the City recognized pension expense of $8,886,124. At June 30, 2019, the City reported deferred outflows of resources and deferred inflows of resources related to pensions from the following sources:
104Attachment 1, Page 104 of 218
City of Springfield, Oregon
NOTES TO FINANCIAL STATEMENTS Year Ended June 30, 2019
NOTE M – PERS DEFINED BENEFIT PENSION PLAN – Continued
Deferred Outflows of Resources
Deferred Inflows of Resources
Differences between expected and actual experience $ 1,550,698 $ -
Changes of assumptions 10,598,652 -
Net difference between projected and actual earnings of pension plan investments - ( 2,024,275 )
Changes in proportion and differences between employer contributions and proportionate share of contributions
983,719 ( 921,892)
Differences between employer contributions and employer’s
proportionate share of system contributions - ( 660,967)
Total (prior to post measurement date contributions) 13,133,069 ( 3,607,134)
Contributions subsequent to the measurement date 4,190,470 -
Total Deferred Outflow/Inflow of Resources $ 17,323,539 $ ( 3,307,134)
The $4,190,470 reported as deferred outflows of resources related to pensions resulting from City contributions subsequent to the measurement date will be recognized as a reduction of the net pension liability in the year ended June 30, 2020. Other amounts reported as deferred outflows of resources and deferred inflows of resources related
to pensions will be recognized in pension expense as follows:
Actuarial Valuations – The employer contribution rates effective July 1, 2017, through June 30, 2019, were set using the entry age normal actuarial cost method. Under this cost method, each active member’s entry age present value of projected benefits is allocated over the member’s service from their date of entry until their assumed date of exit, taking into consideration expected future compensation increases. The total pension liability in the December 31, 2016 actuarial valuation was determined using the following actuarial assumptions:
Year Ending June 30,
2020 5,435,548$
2021 3,816,630 2022 (455,225)
2023 488,671
2024 240,312
Total 9,525,936$
105Attachment 1, Page 105 of 218
City of Springfield, Oregon
NOTES TO FINANCIAL STATEMENTS Year Ended June 30, 2019
NOTE M – PERS DEFINED BENEFIT PENSION PLAN – Continued
The actuarial valuation calculations are based on the benefit provided under the terms of the plan in effect at the time of each valuation and on the pattern of sharing of costs between the employer and plan members. Experience studies are performed as of December 31 of even numbered years. The methods and assumptions shown above are based on the 2016 Experience Study which reviewed experience for the four-year period ending on December 31,
2016. Discount Rate – The discount rate used to measure the total pension liability was 7.20% for the Defined Benefit
Pension Plan. The projection of cash flows used to determine the discount rate assumed that contributions from plan members and those of the contributing employers are made at the contractually required rates, as actuarially determined. Based on those assumptions, the pension plan’s fiduciary net position was projected to be available to
make all projected future benefit payments of current plan members. Therefore, the long-term expected rate of return on pension plan investments for the Defined Benefit Pension Plan was applied to all periods of projected benefit payments to determine the total pension liability.
Actuarial Assumptions
Valuation Date December 31, 2016
Measurement Date June 30, 2018
Experience Study Report 2016, published July 26, 2017
Actuarial cost method Entry Age Normal
Actuarial assumptions:
Inflation rate 2.50 percent
Long-term expected rate of return 7.20 percent
Discount rate 7.20 percent
Projected salary increases 3.50 percent
Cost of living adjustments (COLA)Blend of 2.00% COLA and graded COLA
(1.25%/0.15%) in accordance with Moro decision:
Blend based on service.
Mortality Healthy retirees and beneficiaries:
RP-2014 Healthy annuitant, sex-distinct, generational
with Unisex, Social Security Data Scale, with collar
adjustments and set-backs as described in the valuation.
Active members:
RP-2014 Employees, sex-distinct, generational with
Unisex, Social Security Data Scale, with collar
adjustments and set-backs as described in the valuation.
Disabled Retirees:
RP-2014 Disabled retirees, sex-distinct, generational
with Unisex, Social Security Data Scale.
106Attachment 1, Page 106 of 218
City of Springfield, Oregon
NOTES TO FINANCIAL STATEMENTS Year Ended June 30, 2019
NOTE M – PERS DEFINED BENEFIT PENSION PLAN – Continued Depletion Date Projection – GASB Statement No. 68 generally requires that a blended discount rate be used to measure the Total Pension Liability (the Actuarial Accrued Liability calculated using the Individual Entry Age Normal Cost Method). The long-term expected return on plan investments may be used to discount liabilities to the extent that the plan’s Fiduciary Net Position (fair market value of assets) is projected to cover benefit payments and administrative expenses. A 20-year high quality (AA/Aa or higher) municipal bond rate must be used for periods where the Fiduciary Net Position is not projected to cover benefit payments and administrative expenses. Sensitivity of the City's proportionate share of the net pension liability to changes in the discount rate – The following presents the City's proportionate share of the net pension liability (asset) calculated using the discount rate of 7.20%, as well as what the City's proportionate share of the net pension liability (asset) would be if it were calculated using a discount rate that is 1-percentage-point lower (6.20%) or 1-percentage-point higher (8.20%) than
the current rate:
1 % Decrease (6.20%)
Current
Discount Rate (7.20%)
1 % Increase (8.20%) City’s proportionate share of the net pension liability (asset) $76,182,769 $45,585,971 $20,330,818
Long-Term Expected Rate of Return – To develop an analytical basis for the selection of the long-term expected
rate of return assumption, in July 2015 the PERS Board reviewed long-term assumptions developed by both Milliman’s capital market assumptions team and the Oregon Investment Council’s (OIC) investment advisors. The following table shows Milliman’s assumptions for each of the asset classes in which the plan was invested at that
time based on the OIC long-term target asset allocation. The OIC’s description of each asset class was used to map the target allocation to the asset classes shown below. Each asset class assumption is based on a consistent set of underlying assumptions, and includes adjustment for the inflation assumption. These assumptions are not based on historical returns, but instead are based on a forward-looking capital market economic model.
107Attachment 1, Page 107 of 218
City of Springfield, Oregon
NOTES TO FINANCIAL STATEMENTS Year Ended June 30, 2019
NOTE M – PERS DEFINED BENEFIT PENSION PLAN – Continued
Pension plan fiduciary net position – Detailed information about the pension plan's fiduciary net position is available in the separately issued OPERS financial report. The effect of OPERS on the City’s net position has been determined on the same basis used by OPERS.
NOTE N – PERS DEFINED CONTRIBUTION PENSION PLAN Plan Description – OPSRP Individual Account Program (IAP) is a defined contribution pension plan for Tier One/Tier Two and OPSRP plan members. All benefits of the system are established by the legislature pursuant to ORS Chapters 238 and 238A.
Plan Benefits – An IAP member becomes vested on the date the employee account is established or on the date the rollover account was established. If the employer makes optional employer contributions for a member, the member becomes vested on the earliest of the following dates: the date the member completes 600 hours of service in each
Compound
Annual Return
Asset Class Target (Geometric)
Core Fixed Income 8.00 %3.49 %
Short-Term Bonds 8.00 3.38
Bank/Leveraged Loans 3.00 5.09
High Yield Bonds 1.00 6.45
Large/Mid Cap US Equities 15.75 6.30
Small Cap US Equities 1.31 6.69
Micro Cap US Equities 1.31 6.80
Developed Foreign Equities 13.13 6.71
Emerging Market Equities 4.13 7.45
Non-US Small Cap Equities 1.88 7.01
Private Equity 17.50 7.82
Real Estate (Property)10.00 5.51
Real Estate (REITS)2.50 6.37
Hedge Fund of Funds - Diversified 2.50 4.09
Hedge Fund - Event-driven 0.63 5.86
Timber 1.88 5.62
Farmland 1.88 6.15
Infrastructure 3.75 6.60
Commodities 1.88 3.84
Assumed Inflation - Mean - 2.50
108Attachment 1, Page 108 of 218
City of Springfield, Oregon
NOTES TO FINANCIAL STATEMENTS Year Ended June 30, 2019
NOTE N – PERS DEFINED CONTRIBUTION PENSION PLAN – Continued of five calendar five calendar years, the date the member reaches normal retirement age, the date the IAP is terminated, the date the active member becomes disabled, or the date the active member dies. Upon retirement, a member of the OPSRP IAP may receive the amounts in his or her employee account, rollover account, and vested employer account as a lump-sum payment or in equal installments over a 5-, 10-, 15-, or 20-year period or anticipated life span option. Each distribution option has a $200 minimum distribution limit.
Death Benefits – Upon the death of a non-retired member, the beneficiary receives in a lump sum the member’s account balance, rollover account balance, and vested employer optional contribution account balance. If a retired member dies before the installment payments are completed, the beneficiary may receive the remaining installment payments or choose a lump-sum payment.
Recordkeeping – PERS contracts with VOYA Financial to maintain IAP participant records. Contributions – State statute requires that covered employees contribute 6% of their covered salary to the IAP plan effective January 1, 2004. Statute allows that the employer may elect to pay any or all of the employee’s required IAP contributions. The City has elected to pay all of the employees’ required IAP contribution, except for employees who are members of the City’s International Association of Fire Fighters (IAFF) union, which elected to pay the required employee contribution. For the fiscal year ending June 30, 2019, the City’s contribution to the IAP plan was $1,917,920. NOTE O – OTHER POSTEMPLOYMENT BENEFITS The other postemployment benefits (OPEB) for the City combines two separate plans. The City provides an
implicit rate subsidy for retiree medical insurance premiums, and a contribution to the State of Oregon’s PERS cost-sharing multiple-employer defined health insurance benefit plan.
Financial Statement Presentation The City’s two OPEB plans are presented in the aggregate on the Statement of Net Position. The amounts on the
financial statements relate to the plans as follows:
109Attachment 1, Page 109 of 218
City of Springfield, Oregon
NOTES TO FINANCIAL STATEMENTS Year Ended June 30, 2019
NOTE O – OTHER POSTEMPLOYMENT BENEFITS – Continued
IMPLICIT RATE SUBSIDY PLAN Plan Description Plan Description - The City administers a single-employer defined benefit healthcare plan as established through negotiations between the City and collective bargaining units. The healthcare plan provides post-retirement medical, dental, and vision coverage for eligible retirees, spouses, and dependents. The following groups are eligible: Non-Medicare eligible regular retirees, disability retirees, Non-Medicare eligible early retirees eligible for pension under a City Plan or OPERS with at least 5 years of benefited service at the City, and Non-Medicare
eligible early retirees whose age plus years of service equal 70 or greater at their time of retirement. At June 30, 2019, 23 qualified retirees are eligible to receive this benefit. The retiree is responsible for the full premium as established by the City for all participants of the plan less a subsidy of $115 per month provided by the City. The
City treats this subsidy as a single-employer, defined benefit OPEB plan administered by the City only to satisfy the accounting and financial reporting requirements of GASB 75, and a separate financial report is not issued. The total cost of providing this subsidy for the fiscal year ended June 30, 2019 was $31,754.
The City also provides disability retirement contributions for employees who cease working because of a permanent disability. The following groups are eligible: employees, who at the time of disability retirement were covered under the City Retirement Plan, and employees, who at the time of disability retirement were covered under the Money Purchase Pension Plan. The authority for this coverage is in the pension plan documents. All of the disability retirees are members of the City Retirement Plan. For these employees, the amount of the pension contribution is either 7%, 8%, or 9% of the employee’s last monthly salary, depending on what the employee’s contribution rate was before retirement. At June 30, 2019, there was one employee receiving this benefit.
Implicit Rate RHIA Total
Subsidy Plan Cost Sharing Plan Reported
OPEB Asset/(Liability)(6,659,696)$ 322,081$ (6,337,615)$
Deferred Outflows of Resources
Difference in expected and actual experience 142,296 142,296
Benefit payments 300,212 300,212
Changes in proportionate share 1,572 1,572
Contributions after the measurement date 138,490 138,490
Deferred Inflows of Resources
Difference in expected and actual experience - (18,253) (18,253)
Changes of assumptions (1,473,818) (1,022) (1,474,840)
Difference in earnings - (69,440) (69,440)
Change in proportionate share - (412) (412)
OPEB Expense 500,524 (29,788) 470,736
110Attachment 1, Page 110 of 218
City of Springfield, Oregon
NOTES TO FINANCIAL STATEMENTS Year Ended June 30, 2019
NOTE O – OTHER POSTEMPLOYMENT BENEFITS – Continued Total OPEB Liability, OPEB Expense, and Deferred Outflows of Resources and Deferred Inflows of Resources Related to OPEB - The City’s total OPEB liability of $6,659,696 was measured as of June 30, 2019, and was determined by an actuarial valuation as of July 1, 2018. For the fiscal year ended June 30, 2019, the City recognized OPEB expense from this plan of $500,524. At June 30, 2019, the City reported deferred outflows of resources and deferred inflows of resources related to this OPEB plan from the following sources:
Deferred outflows of resources related to OPEB of $300,212 resulting from the City’s contributions subsequent to the measurement date will be recognized as a reduction of the total OPEB liability in the year ending June 30, 2020. Other amounts reported as deferred inflows of resources related to OPEB will be recognized in OPEB expense as
follows:
Actuarial Assumptions and Other Inputs - The total OPEB liability in the July 1, 2018 valuation was determined using the following actuarial assumptions and other inputs, applied to all periods included in the measurement, unless otherwise specified:
Net Deferred
Deferred Inflows Deferred Outflows (Inflows)/Outflows
of Resources of Resources of Resources
Difference in expected and actual experience -$ 142,296$ 142,296$
Changes of assumptions or inputs (1,473,818) - (1,473,818)
Contributions made subsequent to measurement date - 300,212 300,212
(1,473,818)$ 442,508$ (1,031,310)$
Year Ended Annual
June 30:Recognition
2020 (168,464)$
2021 (168,464)
2022 (168,464)
2023 (168,464)
2024 (168,464)
Thereafter (489,202)
Total (1,331,522)$
111Attachment 1, Page 111 of 218
City of Springfield, Oregon
NOTES TO FINANCIAL STATEMENTS Year Ended June 30, 2019
NOTE O – OTHER POSTEMPLOYMENT BENEFITS – Continued
Changes in the Total OPEB Liability (Implicit Rate Subsidy Plan)
Sensitivity of the Total OPEB Liability - The following presents the total OPEB liability of the Plan, calculated using the discount rate of 3.87%, as well as what the Plan’s total OPEB liability would be if it were calculated using
a discount rate that is 1 percentage point lower (2.87%) or 1 percentage point higher (4.87%) than the current rate. A similar sensitivity analysis is then presented for changes in the healthcare cost trend assumption.
Valuation date July 1, 2018
Measurement Date June 30, 2018
Discount rate 3.87%
Inflation 2.50%
Salary Increases 3.50%
Withdrawal, retirement, and mortality rates December 31, 2017 Oregon PERS valuation and
July 1, 2018 Springfield Retirement Plan valuation
Election and Lapse Rates 60% of members eligible for the explicit
employer-paid benefit. 35% of other eligible
employees. 60% of male members and 35%
of female members will elect spouse coverage.
5% annual lapse rate
Actuarial cost method Entry Age Normal
Balance as of June 30, 2018 7,412,283$
Changes for the year:
Service Cost 395,930
Interest on total OPEB liability 273,058
Effect of changes to benefit terms -
Effect of economic/demographic gains or losses 159,236
Effect of assumptions changes or inputs (1,219,048)
Benefit payments (361,763)
Balance as of June 30, 2019 6,659,696$
112Attachment 1, Page 112 of 218
City of Springfield, Oregon
NOTES TO FINANCIAL STATEMENTS Year Ended June 30, 2019
NOTE O – OTHER POSTEMPLOYMENT BENEFITS – Continued
PERS RETIREMENT HEALTH INSURANCE ACCOUNT (RHIA) Plan Description - The City contributes to the Oregon Public Employees Retirement System’ (PERS) Retiree Health Insurance Account (RHIA), a cost-sharing multiple-employer defined benefit post-employment healthcare plan administered by the Public Employees Retirement Board (PERB). The authority to establish and amend the
benefit provisions of the plan rests with the Oregon Legislature. The plan, which was established under ORS 238.420, provides a payment of up to $60 per month towards the costs of health insurance for eligible PERS retirees. RHIA post-employment benefits are set by state statue. A comprehensive annual financial report of the funds administered by the PERB may be obtained by writing to Oregon Public Employees Retirement System at PO Box 23700, Tigard, Oregon 97281-3700, by calling (888) 320-7377, or by accessing the PERS website at http://www.oregon.gov/PERS/. Funding Policy and contributions - Participating employers are contractually required to contribute at a rate assessed bi-annually by the PERB, currently 0.50% of annual covered payroll for PERS Plan members, and 0.43% for OPSRP Plan members. The PERB sets the employer contribution rate based on an amount actuarially determined in accordance with the parameters of GASB Statement No. 75. The level of funding that, if paid on an ongoing basis, is projected to cover the normal cost each year and amortize any actuarial liabilities of the plan over a period not to exceed five years. The City’s total for the year ended June 30, 2019 contributions was $138,490.
OPEB Liabilities, OPEB Expense, and Deferred Outflows of Resources and Deferred Inflow of Resources Related to OPEB - For the employer cost-sharing plan, the OPEB liability was based on the employer’s share of covered payroll in the OPEB plan relative to the covered payroll of all participating OPEB employers. At June 30,
2019, the City’s proportion was 0.2885%, which was a decrease from its proportion of 0.2986% at the prior measurement date.
For the year ended June 30, 2019, the City recognized deferred outflows of resources and deferred inflows of resources in the amount of $140,062 and $89,127. For the year ended June 30, 2019, the City recognized OPEB income of $29,788 for this plan.
Current
1% Decrease Discount Rate 1% Increase
Total OPEB liability 7,257,484$ 6,659,696$ 6,108,400$
Current
1% Decrease Trend Rate 1% Increase
Total OPEB liability 5,935,947$ 6,659,696$ 7,514,982$
113Attachment 1, Page 113 of 218
City of Springfield, Oregon
NOTES TO FINANCIAL STATEMENTS Year Ended June 30, 2019
NOTE O – OTHER POSTEMPLOYMENT BENEFITS – Continued
Other amounts reported as deferred inflows related to the Oregon’s PERS cost-sharing plan will be recognized in OPEB expense as follows:
Change in Net OPEB Liability (RHIA)
Net Deferred
Deferred Inflows Deferred Outflows (Inflows)/Outflows
of Resources of Resources of Resources
Differences in expected and actual experience (18,253)$ -$ (18,253)$
Changes of assumptions (1,022) - (1,022)
Net difference between projected and actual earnings (69,440) - (69,440)
Changes in proportionate share (412) 1,572 1,160
Subtotal (89,127) 1,572 (87,555)
Contributions subsequent to the measurement date - 138,490 138,490
Total (89,127)$ 140,062$ 50,935$
Year Ended Annual
June 30:Recognition
2020 (28,784)$
2021 (28,712)
2022 (23,156)
2023 (6,903)
2024 -
Thereafter -
Total (87,555)$
Oregon Public Employees Retirement System Cost-sharing Plan 2019
Net OPEB Liability:
Difference between expected and actual experience (18,253)$
Changes in assumptions (1,022)
Net difference between projected and actual earnings (11,724)
Change in proportionate share 1,814
OPEB income (29,788) Benefit payments (138,490)
Net changes in OPEB liability (197,463)
Net OPEB liability (asset) - beginning (124,618)
Net OPEB liability (asset) - ending (322,081)$
City's proportionate share at measurement date 0.28853281%
City's covered employee payroll 31,987,774$
City's proportionate share of the net OPEB liability (asset) as a
percentage of its covered payroll -1.0%
114Attachment 1, Page 114 of 218
City of Springfield, Oregon
NOTES TO FINANCIAL STATEMENTS Year Ended June 30, 2019
NOTE O – OTHER POSTEMPLOYMENT BENEFITS – Continued Discount Rate - The discount rate used to measure the net OPEB liability for the RHIA Plan was 7.20%. The projection of cash flows used to determine the discount rate assumed that the contributions from plan members and those contributing employers are made at the contractually required rates, as actuarially determined. Based on those assumptions, the RHIA plan’s fiduciary net position was projected to be available to make all projected future benefit payments. Therefore, the long term expected rate of return on pension plan investments for the RHIA Plan was applied to all periods of projected benefit payments to determine the net OPEB liability. Sensitivity of the Net OPEB Liability to Changes in the Discount Rate - The following presents the City’s proportionate share of the net OPEB liability (asset) calculated using the discount rate of 7.20%, as well as what the City’s proportionate share of the net OPEB liability (asset) would be if it were calculated using a discount rate that
is 1-percentage-point lower (6.20%) or 1-percentage-point higher (8.20%) than the current rate:
Actuarial Methods and Assumptions - All actuarial methods and assumptions are consistent with those disclosed for the OPERS Pension Plan. See Note M for additional information on assumptions and methods, the Long-Term Expected Rate of Return, and the Discount Rate. NOTE P – COMMITMENTS AND CONTINGENCIES At June 30, 2019, the City was obligated under incomplete construction contracts in the amount of $515,908. The Sick Leave Reserve Program was substantially revised effective July 1, 2004. The plan allows employees to join by contributing hours from their sick leave bank. The number of hours required to join depends on the
employee’s status (full time vs. part time) and regular weekly schedule (40 hours vs. 56 hours). Employees may draw from the reserve bank under certain circumstances. Prior to drawing, employees must exhaust all their own leave accruals first. At June 30, 2019, the Sick Leave Reserve Program bank contained 7,545 hours. The value of these hours is not included in the liability for compensated absences because there is no estimate of the number of hours that will be used. NOTE Q –PRIOR PERIOD ADJUSTMENT A prior period adjustment to the government-wide net position was recorded in the amount of $8,383,703. This represents a contribution to the total cost of major improvements to Springfield infrastructure made by the Oregon
Department of Transportation in prior years.
Current
1% Decrease Discount Rate 1% Increase
(6.20%)(7.20%)(8.20%)
Net OPEB Liability (Asset)(187,531)$ (322,081)$ (436,610)$
115Attachment 1, Page 115 of 218
City of Springfield, Oregon
NOTES TO FINANCIAL STATEMENTS Year Ended June 30, 2019
NOTE R – CONSTITUTIONAL PROPERTY TAX LIMITATION The State of Oregon has a constitutional limit on property taxes for governmental operations. The limitation specifies a maximum rate for local government operations of $10.00 per $1,000 of assessed value. In May 1997, the voters approved a citizen initiative (Measure 50) that rolls back assessed property values to 90 percent of their 1995-96 real market value amount and limits future increases to 3 percent per year, except for major improvements. Under Measure 50, voters may approve new local initiatives provided a majority approves at either a general election in an even numbered year, or at any other election in which at least 50 percent of registered voters cast a ballot. This double majority requirement for local initiatives is no longer required as a result of the passage of statewide measure 56, passed on November 4, 2008.
NOTE S – TAX ABATEMENT
As of June 30, 2019, the City of Springfield provided tax abatements through the Enterprise Zone Program. In previous years, tax abatements were also provided under the Vertical Housing Program (ORS 307.841 – 307.867), however these abatements/exemptions expired in the 2017-2018 tax year. Enterprise Zone (ORS 285C.175) The purpose of the Enterprise Zone program is to stimulate and protect economic success by providing tax incentives for employment, business, industry and commerce and by providing adequate levels of complementary assistance to community strategies for such interrelated goals as environmental protection, growth management and efficient infrastructure. To be an eligible business firm, a business firm must be engaged, or proposing to engage, within the enterprise zone, in the business of providing goods, products or services to businesses or other organizations through activities including, but not limited to, manufacturing, assembly, fabrication, processing, shipping or storage. Qualified real and personal property owned or leased and newly placed into service by a qualified business in an enterprise zone is exempt from property tax for three years. The exemption period may be
increased to a total of four or five consecutive years. For the basic, three-year enterprise zone exemption period, the business needs to:
• Increase full-time, permanent employment of the firm inside the enterprise zone by the greater of one new job or 10% (or less with special-case local sponsor waivers); • Generally have no concurrent job losses outside the zone boundary inside Oregon;
• Maintain minimum employment level during the exemption period; • Enter into a first-source agreement with local job training providers; and • Satisfy any additional local condition that has been established (only) in an urban zone. For the fiscal year ended June 30, 2019, the City of Springfield abated taxes totaling $1,201,181 under the Enterprise Zone program.
116Attachment 1, Page 116 of 218
City of Springfield, Oregon
NOTES TO FINANCIAL STATEMENTS Year Ended June 30, 2019
NOTE T – SUBSEQUENT EVENTS In November of 2018, the voters of the City of Springfield approved measure 20-296 authorizing the City to issue general obligation bonds to fund the first phase of necessary street repairs. This bond closed on August 6, 2019 in the amount of $10 million dollars, and will be repaid over a five year period ending June 1, 2024.
117Attachment 1, Page 117 of 218
118Attachment 1, Page 118 of 218
Required Supplementary
Information
119Attachment 1, Page 119 of 218
120Attachment 1, Page 120 of 218
City of Springfield, Oregon
GENERAL FUND
SCHEDULE OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCE
(NONGAAP BUDGETARY BASIS) - BUDGET AND ACTUAL
Year Ended June 30, 2019
Adjustmentsto Budget GAAPOriginal Revised Basis BasisBudgetBudgetActualVarianceActualActual
Revenues:
Taxes 21,368,540$ 21,368,540$ 22,441,340$ 1,072,800$ -$ 22,441,340$
Licenses, permits and fees 2,890,500 2,890,500 2,878,872 (11,628) - 2,878,872
Intergovernmental revenue 4,390,421 4,575,513 4,835,063 259,550 - 4,835,063
Charges for services 5,623,436 5,623,436 5,271,005 (352,431) - 5,271,005
Fines and forfeitures 1,659,000 1,659,000 1,607,014 (51,986) - 1,607,014
Investment earnings 107,000 107,000 457,015 350,015 2,923 459,938
Miscellaneous revenue 319,359 319,359 370,893 51,534 - 370,893
Total revenues 36,358,256 36,543,348 37,861,202 1,317,854 2,923 37,864,125
Expenditures:
Current operating:
City manager's office 1,460,685 1,574,235 1,425,108 149,127 - 1,425,108
Legal and judicial services 713,376 726,153 646,480 79,673 - 646,480
Human resources 581,260 685,933 644,447 41,486 - 644,447
Finance 2,237,163 2,349,403 2,238,365 111,038 (627) 2,237,738
Information technology 1,980,484 2,079,287 1,954,741 124,546 - 1,954,741
Fire and life safety 11,381,801 11,620,113 11,543,035 77,078 - 11,543,035
Police 14,632,274 14,632,275 14,626,389 5,886 (16,726) 14,609,663
Library 1,677,286 1,702,654 1,654,619 48,035 - 1,654,619
Development and public works 2,530,203 2,586,746 2,449,377 137,369 702 2,450,079
Contingency 1,000,000 1,000,000 - 1,000,000 - -
Capital projects - 25,000 477 24,523 - 477
Total expenditures 38,194,532 38,981,799 37,183,038 1,798,761 (16,651) 37,166,387
Excess of revenues over
(under) expenditures (1,836,276) (2,438,451) 678,164 3,116,615 19,574 697,738
Other financing sources (uses):
Transfers in 1,037,129 1,037,129 759,803 (277,326) - 759,803
Transfers out (437,100) (446,948) (436,006) 10,942 - (436,006)
Total other financing sources (uses)600,029 590,181 323,797 (266,384) - 323,797
Net change in fund balances (1,236,247) (1,848,270) 1,001,961 2,850,231 19,574 1,021,535
Fund balance, beginning of year 8,863,301 9,735,031 9,735,031 - 10,434 9,745,465
Fund balance, end of year 7,627,054$ 7,886,761$ 10,736,992$ 2,850,231$ 30,008$ 10,767,000$
121Attachment 1, Page 121 of 218
City of Springfield, Oregon
STREET FUND
SCHEDULE OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCE
(NONGAAP BUDGETARY BASIS) - BUDGET AND ACTUAL
Year Ended June 30, 2019
Adjustments
to Budget GAAP
Original Revised Basis Basis
Budget Budget Actual Variance Actual Actual
Revenues:
Taxes 1,120,000$ 1,120,000$ 997,491$ (122,509)$ -$ 997,491$
Licenses, permits and fees 145,000 145,000 153,956 8,956 - 153,956
Intergovernmental revenue 4,462,500 4,557,500 4,678,909 121,409 22,632 4,701,541
Charges for services 92,500 92,500 109,777 17,277 - 109,777
Investment earnings 3,000 3,000 40,106 37,106 1,413 41,519
Miscellaneous revenue 4,000 4,000 11,177 7,177 - 11,177
Total revenues 5,827,000 5,922,000 5,991,416 69,416 24,045 6,015,461
Expenditures:
Current operating:
Information technology 355,483 355,482 269,840 85,642 - 269,840
Development and public works 5,481,106 5,576,105 5,536,364 39,741 1,370 5,537,734
Total expenditures 5,836,589 5,931,587 5,806,204 125,383 1,370 5,807,574
Excess of revenues over
(under) expenditures (9,589) (9,587) 185,212 194,799 22,675 207,887
Other financing sources (uses):
Transfers in 427,000 427,000 436,006 9,006 - 436,006
Transfers out (150,000) (150,000) (150,000) - - (150,000)
Total other financing sources (uses)277,000 277,000 286,006 9,006 - 286,006
Net change in fund balances 267,411 267,413 471,218 203,805 22,675 493,893
Fund balance, beginning of year 1,047,881 1,673,414 1,673,414 - 246,468 1,919,882
Change in reserve for inventory - - - - 18,099 18,099
Fund balance, end of year 1,315,292$ 1,940,827$ 2,144,632$ 203,805$ 287,242$ 2,431,874$
122Attachment 1, Page 122 of 218
City of Springfield, Oregon
POLICE LOCAL OPTION LEVY
SCHEDULE OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCE
(NONGAAP BUDGETARY BASIS) - BUDGET AND ACTUAL
Year Ended June 30, 2019
Adjustments
to Budget GAAP
Original Revised Basis Basis
Budget Budget Actual Variance Actual Actual
Revenues:
Taxes 6,240,075$ 6,240,075$ 6,398,223$ 158,148$ -$ 6,398,223$
Licenses, permits, and fees 169,500 169,500 100,191 (69,309) - 100,191
Charge for services 317,600 317,600 758,834 441,234 - 758,834
Investment earnings 12,000 12,000 64,764 52,764 584 65,348
Miscellaneous receipts - - 45,420 45,420 - 45,420
Total revenues 6,739,175 6,739,175 7,367,432 628,257 584 7,368,016
Expenditures:
Current operating:
Finance 663,894 663,894 620,688 43,206 - 620,688
Legal services 76,083 76,083 73,949 2,134 - 73,949
Police 5,984,034 6,077,034 6,042,944 34,090 (2,700) 6,040,244
Total expenditures 6,724,011 6,817,011 6,737,581 79,430 (2,700) 6,734,881
Net change in fund balances 15,164 (77,836) 629,851 707,687 3,284 633,135
Fund balance, beginning of year 899,723 1,184,220 1,184,220 - 2,303 1,186,523
Fund balance, end of year 914,887$ 1,106,384$ 1,814,071$ 707,687$ 5,587$ 1,819,658$
123Attachment 1, Page 123 of 218
City of Springfield, Oregon
SEDA GLENWOOD FUND
SCHEDULE OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCE
(NONGAAP BUDGETARY BASIS) - BUDGET AND ACTUAL
Year Ended June 30, 2019
Adjustments
to Budget GAAP
Original Revised Basis Basis
Budget Budget Actual Variance Actual Actual
Revenues:
Taxes 919,844$ 919,844$ 1,037,693$ 117,849$ -$ 1,037,693$
Intergovernmental revenue - - 113,453 113,453 - 113,453
Charges for services 25,800 25,800 25,800 - - 25,800
Investment earnings 4,800 4,800 58,144 53,344 (3,726) 54,418
Total revenues 950,444 950,444 1,235,090 284,646 (3,726) 1,231,364
Expenditures:
Current operating:
City manager's office 92,784 457,784 76,575 381,209 2,722 79,297
Finance 68,425 21,350 14,320 7,030 - 14,320
Capital projects 5,902,500 5,902,500 5,610,657 291,843 - 5,610,657
Debt service:
Principal 585,485 595,430 594,863 567 (18,190) 576,673
Interest 177,360 156,670 156,602 68 (5,380) 151,222
Total expenditures 6,826,554 7,133,734 6,453,017 680,717 (20,848) 6,432,169
Excess of revenues over (under)
expenditures (5,876,110) (6,183,290) (5,217,927) 965,363 17,122 (5,200,805)
Other financing sources (uses):
Issuance of debt 3,647,000 400,000 - (400,000) - -
Net change in fund balances (2,229,110) (5,783,290) (5,217,927) 565,363 17,122 (5,200,805)
Fund balance, beginning of year 3,062,220 6,024,284 6,024,283 1 (52,230) 5,972,053
Fund balance, end of year 833,110$ 240,994$ 806,356$ 565,362$ (35,108)$ 771,248$
124Attachment 1, Page 124 of 218
City of Springfield, Oregon REQUIRED SUPPLEMENTARY INFORMATION
Year Ended June 30, 2019 Schedule of CRP Employer Contributions
2019 2018 2017 2016 2015 2014 2013 2012 2011 2010
Actuarially determined contribution 1,463$ 1,823$ 1,874$ 1,875$ 1,936$ 2,088$ 1,790$ 1,810$ 1,209$ 1,303$
Actual employer contribution 1,843 1,950 1,916 1,954 1,965 2,088 1,790 1,810 1,209 1,303
Contribution deficiency (Excess)(380) (127) (42) (79) (29) - - - - -
Covered payroll 1,574 2,208 2,027 2,034 2,101 2,426 2,498 2,535 2,738 2,944
Contribution as a % of covered payroll 117.09% 88.32% 94.52% 96.07% 93.53% 86.07% 71.66% 71.40% 44.16% 44.26%
Valuation Date 7/1/2018 7/1/2016 7/1/2016 7/1/2014 7/1/2014 7/1/2012 7/1/2012 7/1/2010 7/1/2010 7/1/2008
Investment Rate of Return Assumption 5.50% 6.50% 6.50% 6.50% 6.50% 6.50% 7.50% 7.50% 7.50% 7.50%
Fiscal Year Ending June 30,
(Dollar Amounts in Thousands)
125Attachment 1, Page 125 of 218
City of Springfield, Oregon REQUIRED SUPPLEMENTARY INFORMATION
Year Ended June 30, 2019 CITY RETIREMENT PLAN PENSION BENEFITS – Continued
Schedule of Changes in Total Pension Liability, Fiduciary Net Position, and Related Ratios
2019 2018 2017 2016 2015
Total Pension Liability
Service cost 409,467$ 576,750$ 596,684$ 608,191$ 611,102$
Interest on total pension liability 1,942,409 2,137,457 2,333,205 2,199,860 2,186,388
Effect of economic/demographic (gains) or losses (606,741) - (1,642,892) - -
Effect of assumptions changes or inputs 1,241,053 - 70,885 - -
Benefit payments (2,442,290) (8,653,011) (45,910) (1,444,246) (3,730,383)
Net change in total pension liability 543,898 (5,938,804) 1,311,972 1,363,805 (932,893)
Total pension liability, beginning 30,694,901 36,633,705 35,321,733 33,957,928 34,890,821
Total pension liability, ending (a)31,238,799 30,694,901 36,633,705 35,321,733 33,957,928
Fiduciary Net Position
Employer contributions 1,842,671 1,949,686 1,916,262 1,953,954 1,964,977
Investment income net of investment expenses 1,387,284 1,973,759 2,717,812 (12,259) 708,524
Benefit payments (2,442,290) (8,653,011) (45,910) (1,444,246) (3,730,383)
Administrative expenses (71,812) (86,436) (76,423) (68,077) (70,078)
Net change in plan net position 715,853 (4,816,002) 4,511,741 429,372 (1,126,960)
Fiduciary net position, beginning 20,438,552 25,254,554 20,742,813 20,313,441 21,440,401
Fiduciary net position, ending (b)21,154,405 20,438,552 25,254,554 20,742,813 20,313,441
Net pension liability, ending (a) - (b)10,084,394$ 10,256,349$ 11,379,151$ 14,578,920$ 13,644,487$
Fiduciary net position as a % of total pension liability 68%67%69%59%60%
Covered payroll 1,573,655$ 2,207,506$ 2,027,175$ 2,034,238$ 2,100,871$
Net pension liability as a % of covered payroll 641%465%561% 717% 649%
*This schedule is intended to show a 10-year trend of contributions. However, until a full 10-year trend is compiled, information will only be
presented for those years in which it is available.
126Attachment 1, Page 126 of 218
City of Springfield, Oregon REQUIRED SUPPLEMENTARY INFORMATION
Year Ended June 30, 2019 OPERS RETIREMENT PLAN PENSION BENEFITS Schedule of Proportionate Share of Net Pension Liability
Schedule of Contributions
2019 2018 2017 2016 2015 2014
Proportion of the net pension liability (asset)0.3009% 0.3053% 0.2894% 0.3089% 0.2801% 0.2801%
Proportionate share of the net pension liability (asset)45,585,971$ 41,153,474$ 43,443,622$ 17,733,343$ (6,349,764)$ 14,295,480$
Covered payroll 29,957,604 29,371,018 28,785,414 27,340,088 26,270,045 26,151,761
Proportionate share of the pension liability (asset) as a
percentage of its covered payroll 152.17% 140.12% 150.92% 64.86% -24.17% 54.42%
Plan net position as a percentage of the total pension liability 82.1%83.1% 80.5% 91.9% 103.6% 92.0%
*This schedule is intended to show a 10-year trend of changes in the net pension liability. However, until a full 10-year trend is compiled,
information will only be presented for those years in which it is available.
**Amounts presented are as of the measurement date, which is one year in arrears
Fiscal Year Ending June 30,
2019 2018 2017 2016 2015 2014
Contractually required contribution 4,190,470$ 3,930,696$ 2,875,247$ 2,718,458$ 2,393,904$ 2,371,838$
Contributions in relation to the contractually required contribution 4,190,470 3,930,696 2,875,247 2,718,458 2,393,904 2,371,838
Contribution deficiency (excess)-$ -$ -$ -$ -$ -$
Covered payroll 31,987,774$ 29,957,604$ 29,371,018$ 27,340,088$ 27,340,088$ 26,270,045$
Contributions as a percentage of covered payroll 13.10% 13.12% 9.79% 9.94% 8.76% 9.03%
*This schedule is intended to show a 10-year trend of contributions. However, until a full 10-year trend is compiled, information will only be
presented for those years in which it is available.
Fiscal Year Ending June 30,
127Attachment 1, Page 127 of 218
City of Springfield, Oregon REQUIRED SUPPLEMENTARY INFORMATION
Year Ended June 30, 2019 OPEB RETIREMENT PLAN PENSION BENEFITS Schedule of Proportionate Share of Net OPEB Liability
Implicit Rate Subsidy Plan 2019 2018
Total OPEB Liability:
Services cost 395,930$ 453,737$
Interest on total OPEB liability 273,058 223,423
Difference between expected and actual experience
Effect of economic/demographic (gains) or losses 159,236
Effect of assumptions, changes or inputs (1,219,048) (495,892)
Benefit payments (361,763) (309,306)
Net change in total OPEB liability (752,587)$ (128,038)$
Total OPEB liability - beginning 7,412,283 6,559,960
Restatement for GASB 75 Implementation 980,361
Total OPEB liability - beginning as restated 7,412,283 7,540,321
Total OPEB liability - ending 6,659,696$ 7,412,283$
City's covered payroll 29,957,604$ 29,371,018$
Total OPEB liability as a percentage of covered payroll 22.2%25.2%
*This schedule is intended to show a 10-year trend of changes in the net pension liability. However, until a full 10-year trend is
compiled, information will only be presented for those years in which it is available.
**Amounts presented are as of the measurement date, which is one year in arrears
Fiscal Year Ending June 30,
128Attachment 1, Page 128 of 218
City of Springfield, Oregon REQUIRED SUPPLEMENTARY INFORMATION
Year Ended June 30, 2019 OPEB RETIREMENT PLAN PENSION BENEFITS – Continued Schedule of Proportionate Share of Net OPEB Liability
Schedule of Contributions
RHIA Cost Sharing Plan 2019 2018
Net OPEB Liability:
Proportion of the net pension liability (asset)0.2885% 0.2986%
Proportionate share of the net pension liability (asset)(322,081)$ (124,618)$
Covered payroll 29,957,604 29,371,018
Proportionate share of the pension liability (asset) as a
percentage of its covered payroll -1.1%-0.4%
Plan net position as a percentage of the total pension liability 124.0% 108.9%
*This schedule is intended to show a 10-year trend of changes in the net pension liability. However, until a full 10-year trend is
compiled, information will only be presented for those years in which it is available.
**Amounts presented are as of the measurement date, which is one year in arrears
Fiscal Year Ending June 30,
2019 2018
Contractually required contribution 147,942$ 139,708$
Contributions in relation to the contractually required contribution 138,490 148,660
Contribution deficiency (excess)9,452$ (8,952)$
Covered payroll 31,987,774$ 29,957,604$
Contributions as a percentage of covered payroll 0.46%0.47%
*This schedule is intended to show a 10-year trend of contributions. However, until a full 10-year trend is compiled, information
will only be presented for those years in which it is available.
Fiscal Year Ending June 30,
129Attachment 1, Page 129 of 218
130Attachment 1, Page 130 of 218
Other Supplementary
Information
131Attachment 1, Page 131 of 218
132Attachment 1, Page 132 of 218
Nonmajor Governmental Funds
Combining Statements
133Attachment 1, Page 133 of 218
134Attachment 1, Page 134 of 218
City of Springfield, Oregon
NONMAJOR GOVERNMENTAL FUNDS
COMBINING BALANCE SHEET
June 30, 2019
Total
Nonmajor
Special Capital Debt Governmental
Revenue Funds Projects Funds Service Funds Funds
ASSETS
Cash and investments 6,260,423$ 8,863,788$ 399,226$ 15,523,437$
Receivables:
Accounts 326,533 19,368 - 345,901
Taxes 88,329 - 156,655 244,984
Grants 129,367 - - 129,367
Accrued interest 16,648 26,387 3,774 46,809
Assessments and liens - 61,697 - 61,697
Notes 1,340,772 - - 1,340,772
Deferred system development fees 26 928,915 - 928,941
Prepaid items 256,462 - - 256,462
Total assets 8,418,560$ 9,900,155$ 559,655$ 18,878,370$
LIABILITIES, DEFERRED INFLOWS OF
RESOURCES, AND FUND BALANCES
Liabilities:
Accounts payable 155,338$ 88,532$ -$ 243,870$
Accrued payroll and other liabilities 66,815 371 - 67,186
Deposits 1,500 53,075 - 54,575
Total liabilities 223,653 141,978 - 365,631
Deferred inflows of resources:
Unavailable revenue 1,558,190 1,009,981 153,792 2,721,963
Fund Balances:
Nonspendable 256,462 - - 256,462
Restricted 5,885,902 5,416,051 400,482 11,702,435
Committed - 2,569,918 - 2,569,918
Assigned 494,353 762,227 5,381 1,261,961
Total fund balances 6,636,717 8,748,196 405,863 15,790,776
Total liabilities, deferred inflows of
resources, and fund balances 8,418,560$ 9,900,155$ 559,655$ 18,878,370$
135Attachment 1, Page 135 of 218
Total
Nonmajor
Special Capital Debt Governmental
Revenue Funds Project Funds Service Funds Funds
Revenues:
Taxes 3,803,672$ -$ 1,955,662$ 5,759,334$
Licenses, permits and fees 51,528 - - 51,528
Intergovernmental revenue 616,580 122,276 - 738,856
Charges for services 1,127,194 962,905 - 2,090,099
Fines and forfeitures 212,415 - - 212,415
Investment earnings 143,496 222,412 30,557 396,465
Special assessments - 17,098 - 17,098
Miscellaneous revenue 288,209 489,966 - 778,175
Total revenues 6,243,094 1,814,657 1,986,219 10,043,970
Expenditures:
Current operating:
General government 563,383 41,210 - 604,593
Fire and life safety 1,571,090 - - 1,571,090
Police 465,802 - - 465,802
Library 249,516 - - 249,516
Development and public works 1,640,565 - - 1,640,565
Capital projects - 484,313 - 484,313
Debt service:
Principal - - 1,445,000 1,445,000
Interest - - 523,000 523,000
Total expenditures 4,490,356 525,523 1,968,000 6,983,879
Excess of revenues over
(under) expenditures 1,752,738 1,289,134 18,219 3,060,091
Other financing sources (uses):
Transfers in - 263,029 - 263,029
Transfers out (610,452) (81,803) - (692,255)
Total other financing sources (uses)(610,452) 181,226 - (429,226)
1,142,286 1,470,360 18,219 2,630,865
Fund balance, beginning of year 5,494,431 7,277,836 387,644 13,159,911
Fund balance, end of year 6,636,717$ 8,748,196$ 405,863$ 15,790,776$
Net change in fund balances
Year ended June 30, 2019
COMBINING STATEMENT OF REVENUES, EXPENDITURES, AND CHANGES IN FUND BALANCE
NONMAJOR GOVERNMENTAL FUNDS
City of Springfield, Oregon
136Attachment 1, Page 136 of 218
Special Revenue Funds
Combining statements for all individual nonmajor special revenue funds are reported here. The combined totals are reported in the combining nonmajor governmental fund statements. Fund statements for major special revenue funds are reported in the basic financial statements.
Schedules of revenues, expenses, and changes in fund balance – budget and actual are presented here for each individual nonmajor special revenue fund. Budget and actual comparisons for major special revenue funds are reported as required supplementary information. Major Special Revenue Funds: Street Fund – This fund accounts for revenues from state gasoline taxes apportioned from the State of Oregon and expenditures as specified under Article IX, Section 3 of the Constitution of the State of Oregon. Police Local Option Levy – This fund accounts for revenue received from a five-year Police Local Option Levy to enhance public safety services by adding staff to the Police and Court Departments as well as funding jail operations.
SEDA Glenwood Fund – This fund accounts for the general fund of the Springfield Economic Development Agency Glenwood Urban Renewal District. Nonmajor Special Revenue Funds: Special Revenue Fund – This fund accounts for the receipt of 911 taxes collected to provide an emergency communications system and the receipt and expenditure of grant monies from various state and federal government agencies. Transient Room Tax Fund – This fund accounts for revenues from hotel and motel taxes and expenditures related and restricted to the economic development of the area. Community Development Fund – This fund accounts for the receipt and expenditure of monies received from the United States Government under the Community Development Block Grant Program. Building Code Fund – This fund accounts for the dedicated revenues generated in providing building permit and inspection services. SEDA Downtown Fund – This fund accounts for the general fund of the Springfield Economic Development Agency Downtown Urban Renewal District. Fire Local Option Levy – This fund accounts for revenue received from a five-year Fire Local Option Levy to restore staffing to Fire Station #3.
137Attachment 1, Page 137 of 218
138Attachment 1, Page 138 of 218
Special Transient Community SEDA
Revenue Room Tax Development Building Downtown Fire Levy Total
ASSETS
Cash and investments 870,503$ 1,522,317$ 16,968$ 2,308,100$ 842,445$ 700,090$ 6,260,423$
Receivables:
Accounts 25,275 262,648 - - - 38,610 326,533
Taxes - - - - 21,968 66,361 88,329
Grants 54,235 - 75,132 - - - 129,367
Prepaid expenses 255,806 - 656 - - - 256,462
Accrued interest - 4,322 - 7,492 2,159 2,675 16,648
Notes - - 1,228,799 - 111,973 - 1,340,772
Deferred system development fees - - - 26 - - 26
Total assets 1,205,819$ 1,789,287$ 1,321,555$ 2,315,618$ 978,545$ 807,736$ 8,418,560$
LIABILITIES, DEFERRED INFLOWS OF
RESOURCES, AND FUND BALANCES
Liabilities:
Accounts payable 50,305$ 8,244$ 12,024$ 3,903$ 62,904$ 17,958$ 155,338$
Accrued payroll and other
liabilities - 6,995 5,557 20,999 - 33,264 66,815
Deposits - - - - 1,500 - 1,500
Total liabilities 50,305 15,239 17,581 24,902 64,404 51,222 223,653
Deferred inflows of resources:
Unavailable revenue 25,206 149,333 1,259,929 26 21,052 102,644 1,558,190
Fund balances:
Nonspendable 255,806 - 656 - - - 256,462
Restricted 380,149 1,624,715 43,389 2,290,690 893,089 653,870 5,885,902
Assigned 494,353 - - - - - 494,353
Total fund balances 1,130,308 1,624,715 44,045 2,290,690 893,089 653,870 6,636,717
Total liabilities, deferred inflows of
resources, and fund balances 1,205,819$ 1,789,287$ 1,321,555$ 2,315,618$ 978,545$ 807,736$ 8,418,560$
City of Springfield, Oregon
NONMAJOR SPECIAL REVENUE FUNDS
COMBINING BALANCE SHEET
June 30, 2019
139Attachment 1, Page 139 of 218
Special Transient Community SEDA
Revenue Room Tax Development Building Downtown Fire Levy Total
Revenues:
Taxes -$ 1,382,885$ -$ -$ 765,063$ 1,655,724$ 3,803,672$
Licenses, permits and fees - - - - 51,528 - 51,528
Intergovernmental revenue 360,685 - 204,562 - 350 50,983 616,580
Charges for services - - - 1,127,194 - - 1,127,194
Fines and forfeitures 167,980 - - - 44,435 - 212,415
Investment earnings 7,573 35,184 - 60,796 18,180 21,763 143,496
Miscellaneous revenue 134,126 1,706 152,252 - 125 - 288,209
Total revenues 670,364 1,419,775 356,814 1,187,990 879,681 1,728,470 6,243,094
Expenditures:
Current operating:
City manager's office 130,267 136,508 - - 269,809 - 536,584
Finance - - 19,894 - 6,905 - 26,799
Fire and life safety - - - 57,915 - 1,513,175 1,571,090
Police 465,802 - - - - - 465,802
Library 92,228 157,288 - - - - 249,516
Development and public works 3,793 102,643 404,755 1,129,374 - - 1,640,565
Total expenditures 692,090 396,439 424,649 1,187,289 276,714 1,513,175 4,490,356
Excess of revenues over
(under) expenditures (21,726) 1,023,336 (67,835) 701 602,967 215,295 1,752,738
Other financing sources (uses):
Transfers out - (610,452) - - - - (610,452)
Total other financing sources (uses)- (610,452) - - - - (610,452)
Net change in fund balances (21,726) 412,884 (67,835) 701 602,967 215,295 1,142,286
Fund balances, beginning of year 1,152,034 1,211,831 111,880 2,289,989 290,122 438,575 5,494,431
Fund balances, end of year 1,130,308$ 1,624,715$ 44,045$ 2,290,690$ 893,089$ 653,870$ 6,636,717$
Year ended June 30, 2019
COMBINING STATEMENT OF REVENUES, EXPENDITURES, AND CHANGES IN FUND BALANCE
NONMAJOR SPECIAL REVENUE FUNDS
City of Springfield, Oregon
140Attachment 1, Page 140 of 218
City of Springfield, Oregon
SPECIAL REVENUE FUND
SCHEDULE OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCE
(NONGAAP BUDGETARY BASIS) - BUDGET AND ACTUAL
Year Ended June 30, 2019
Adjustments
to Budget GAAP
Original Revised Basis Basis
Budget Budget Actual Variance Actual Actual
Revenues:
Intergovernmental revenue 115,000$ 366,102$ 360,685$ (5,417)$ -$ 360,685$
Fines and forfeitures - 45,000 167,980 122,980 - 167,980
Investment earnings - - 7,573 7,573 - 7,573
Miscellaneous revenue 127,630 157,883 134,126 (23,757) - 134,126
Total revenues 242,630 568,985 670,364 101,379 - 670,364
Expenditures:
Current operating:
City manager's office 30,730 157,604 130,267 27,337 - 130,267
Police 320,000 746,228 465,802 280,426 - 465,802
Library 74,992 132,209 97,034 35,175 (4,806) 92,228
Development and public works 12,000 12,000 3,793 8,207 - 3,793
Capital projects - 98,000 - 98,000 - -
Total expenditures 437,722 1,146,041 696,896 449,145 (4,806) 692,090
Net change in fund balances (195,092) (577,056) (26,532) 550,524 4,806 (21,726)
Fund balance, beginning of year 1,003,670 1,152,035 1,152,034 (1) - 1,152,034
Fund balance, end of year 808,578$ 574,979$ 1,125,502$ 550,523$ 4,806$ 1,130,308$
141Attachment 1, Page 141 of 218
City of Springfield, Oregon
TRANSIENT ROOM TAX FUND
SCHEDULE OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCE
(NONGAAP BUDGETARY BASIS) - BUDGET AND ACTUAL
Year Ended June 30, 2019
Adjustments
to Budget GAAP
Original Revised Basis Basis
Budget Budget Actual Variance Actual Actual
Revenues:
Taxes 1,435,000$ 1,435,000$ 1,382,885$ (52,115)$ -$ 1,382,885$
Investment earnings 24,000 24,000 34,778 10,778 406 35,184
Miscellaneous revenue - - 1,706 1,706 - 1,706
Total revenues 1,459,000 1,459,000 1,419,369 (39,631) 406 1,419,775
Expenditures:
Current operating:
City manager's office 188,034 228,034 136,508 91,526 - 136,508
Library 174,523 243,712 157,288 86,424 - 157,288
Development and public works 115,405 115,405 102,643 12,762 - 102,643
Total expenditures 477,962 587,151 396,439 190,712 - 396,439
Excess of revenues over
(under) expenditures 981,038 871,849 1,022,930 151,081 406 1,023,336
Other financing sources (uses):
Transfers out (637,778) (637,778) (610,452) 27,326 - (610,452)
Net change in fund balances 343,260 234,071 412,478 178,407 406 412,884
Fund balance, beginning of year 1,137,474 1,209,230 1,209,230 - 2,601 1,211,831
Fund balance, end of year 1,480,734$ 1,443,301$ 1,621,708$ 178,407$ 3,007$ 1,624,715$
142Attachment 1, Page 142 of 218
City of Springfield, Oregon
COMMUNITY DEVELOPMENT FUND
SCHEDULE OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCE
(NONGAAP BUDGETARY BASIS) - BUDGET AND ACTUAL
Year Ended June 30, 2019
Adjustments
to Budget GAAP
Original Revised Basis Basis
Budget Budget Actual Variance Actual Actual
Revenues:
Intergovernmental revenue 879,371$ 1,307,679$ 204,562$ (1,103,117)$ -$ 204,562$
Miscellaneous receipts 106,749 106,749 152,252 45,503 - 152,252
Total revenues 986,120 1,414,428 356,814 (1,057,614) - 356,814
Expenditures:
Current operating:
Finance 20,890 20,890 19,894 996 - 19,894
Development and public works 900,786 1,329,095 404,755 924,340 - 404,755
Total expenditures 921,676 1,349,985 424,649 925,336 - 424,649
Net change in fund balances 64,444 64,443 (67,835) (132,278) - (67,835)
Fund balance, beginning of year 117,794 111,879 111,880 1 - 111,880
Fund balance, end of year 182,238$ 176,322$ 44,045$ (132,277)$ -$ 44,045$
143Attachment 1, Page 143 of 218
City of Springfield, Oregon
BUILDING CODE FUND
SCHEDULE OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCE
(NONGAAP BUDGETARY BASIS) - BUDGET AND ACTUAL
Year Ended June 30, 2019
Adjustments
to Budget GAAP
Original Revised Basis Basis
Budget Budget Actual Variance Actual Actual
Revenues:
Charges for services 1,434,500$ 1,434,500$ 1,127,194$ (307,306)$ -$ 1,127,194$
Investment earnings 41,000 41,000 61,018 20,018 (222) 60,796
Total revenues 1,475,500 1,475,500 1,188,212 (287,288) (222) 1,187,990
Expenditures:
Current operating:
Fire and life safety 61,069 61,069 57,915 3,154 - 57,915
Development and public works 1,158,463 1,158,463 1,129,374 29,089 - 1,129,374
Total expenditures 1,219,532 1,219,532 1,187,289 32,243 - 1,187,289
Net change in fund balances 255,968 255,968 923 (255,045) (222) 701
Fund balance, beginning of year 2,112,075 2,284,554 2,284,554 - 5,435 2,289,989
Fund balance, end of year 2,368,043$ 2,540,522$ 2,285,477$ (255,045)$ 5,213$ 2,290,690$
144Attachment 1, Page 144 of 218
City of Springfield, Oregon
SEDA DOWNTOWN FUND
SCHEDULE OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCE
(NONGAAP BUDGETARY BASIS) - BUDGET AND ACTUAL
Year Ended June 30, 2019
Adjustments
to Budget GAAP
Original Revised Basis Basis
Budget Budget Actual Variance Actual Actual
Revenues:
Taxes 662,748$ 662,748$ 765,063$ 102,315$ -$ 765,063$
Licenses, permits and fees 50,000 50,000 51,528 1,528 - 51,528
Intergovernmental revenue - - 350 350 - 350
Fines and forfeitures 30,000 30,000 44,435 14,435 - 44,435
Investment earnings 700 700 17,001 16,301 1,179 18,180
Miscellaneous revenue - - 125 125 - 125
Total revenues 743,448 743,448 878,502 135,054 1,179 879,681
Expenditures:
Current operating:
City manager's office 497,910 497,910 381,782 116,128 (111,973) 269,809
Finance 7,225 7,225 6,905 320 - 6,905
Total expenditures 505,135 505,135 388,687 116,448 (111,973) 276,714
Excess of revenues over (under)
expenditures 238,313 238,313 489,815 251,502 113,152 602,967
Fund balance, beginning of year 32,336 296,971 289,799 (7,172) 323 290,122
Fund balance, end of year 270,649$ 535,284$ 779,614$ 244,330$ 113,475$ 893,089$
145Attachment 1, Page 145 of 218
City of Springfield, Oregon
SCHEDULE OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCE
(NONGAAP BUDGETARY BASIS) - BUDGET AND ACTUAL
Year Ended June 30, 2019
Adjustments
to Budget GAAP
Original Revised Basis Basis
Budget Budget Actual Variance Actual Actual
Revenues:
Taxes 1,605,020$ 1,605,020$ 1,655,724$ 50,704$ -$ 1,655,724$
Investment earnings 8,870 8,870 21,533 12,663 230 21,763
Intergovernmental revenue - 89,593 50,983 (38,610) - 50,983
Total revenues 1,613,890 1,703,483 1,728,240 24,757 230 1,728,470
Expenditures:
Current operating:
Fire and life safety 1,480,925 1,570,518 1,513,175 57,343 - 1,513,175
Net change in fund balances 132,965 132,965 215,065 82,100 230 215,295
Fund balance, beginning of year 417,443 436,944 436,944 - 1,631 438,575
Fund balance, end of year 550,408$ 569,909$ 652,009$ 82,100$ 1,861$ 653,870$
FIRE LOCAL OPTION LEVY
146Attachment 1, Page 146 of 218
Debt Service Funds
Combining statements for all individual nonmajor debt service funds are reported here. The combined totals are reported in the combining nonmajor governmental fund statements. The City has no major debt service funds. Schedules of revenues, expenses, and changes in fund balance – budget and actual are presented here for each individual debt service fund.
Nonmajor Debt Service Funds:
General Obligation Debt Service Fund – This fund is used to account for payments on all general obligation debt, except for debt secured by assessment liens. Ad valorem property taxes are levied to make the debt service payments.
Bancroft Redemption Fund – This fund is used to account for all assessments financed at the election of property owners under the State Bancroft Bonding Act.
147Attachment 1, Page 147 of 218
148Attachment 1, Page 148 of 218
City of Springfield, Oregon
NONMAJOR DEBT SERVICE FUNDS
COMBINING BALANCE SHEET
June 30, 2019
GeneralObligation BancroftDebt Service Redemption TotalASSETSCash and investments 393,862$ 5,364$ 399,226$ Receivables:Property taxes 156,655 - 156,655 Accrued interest 3,757 17 3,774
Total assets 554,274$ 5,381$ 559,655$
LIABILITIES, DEFERRED INFLOWS OFRESOURCES, AND FUND BALANCESLiabilities:Accounts and refunds payable -$ -$ -$
Deferred inflows of resources:Unavailable revenue 153,792 - 153,792
Fund balances:Restricted 400,482 - 400,482 Assigned - 5,381 5,381
Total fund balances 400,482 5,381 405,863
Total liabilities, deferred inflows ofresources, and fund balances 554,274$ 5,381$ 559,655$
149Attachment 1, Page 149 of 218
City of Springfield, Oregon
NONMAJOR DEBT SERVICE FUNDS
COMBINING STATEMENT OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCES
Year Ended June 30, 2019
General
Obligation Bancroft
Debt Service Redemption Total
Revenues:
Taxes 1,955,533$ 129$ 1,955,662$
Investment earnings 30,437 120 30,557
Total revenues 1,985,970 249 1,986,219
Expenditures:
Debt service:
Principal 1,445,000 - 1,445,000
Interest 523,000 - 523,000
Total expenditures 1,968,000 - 1,968,000
Net change in fund balances 17,970 249 18,219
Fund balances, beginning of year 382,512 5,132 387,644
Fund balances, end of year 400,482$ 5,381$ 405,863$
150Attachment 1, Page 150 of 218
City of Springfield, Oregon
GENERAL OBLIGATION DEBT SERVICE FUND
SCHEDULE OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCE
(NONGAAP BUDGETARY BASIS) - BUDGET AND ACTUAL
Year Ended June 30, 2019
AdjustmentsBudgetto Budget GAAPOriginalRevisedBasisBasisBasisBudgetBudgetActualVarianceActualActualRevenues:Taxes 1,848,741$ 1,848,741$ 1,955,533$ 106,792$ -$ 1,955,533$ Investment earnings 4,000 4,000 30,740 26,740 (303) 30,437
Total revenues 1,852,741 1,852,741 1,986,273 133,532 (303) 1,985,970
Expenditures:Debt service:Principal 1,445,000 1,445,000 1,445,000 - - 1,445,000 Interest 523,005 523,005 523,000 5 - 523,000
Total expenditures 1,968,005 1,968,005 1,968,000 5 - 1,968,000
Net change in fund balances (115,264) (115,264) 18,273 133,537 (303) 17,970
Fund balance, beginning of year 350,264 379,595 379,595 - 2,917 382,512
Fund balance, end of year 235,000$ 264,331$ 397,868$ 133,537$ 2,614$ 400,482$
151Attachment 1, Page 151 of 218
City of Springfield, Oregon
BANCROFT REDEMPTION FUND
SCHEDULE OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCE
(NONGAAP BUDGETARY BASIS) - BUDGET AND ACTUAL
Year Ended June 30, 2019
AdjustmentsBudgetto Budget GAAPOriginalRevisedBasisBasisBasisBudgetBudgetActualVarianceActualActualRevenues:Taxes -$ -$ 129$ 129$ -$ 129$ Investment earnings 600 600 196 (404) (76) 120
Total revenues 600 600 325 (275) (76) 249
Expenditures:Current operating:Finance - - - - - -
Excess of revenues over(under) expenditures 600 600 325 (275) (76) 249
Net change in fund balances 600 600 325 (275) (76) 249
Fund balance, beginning of year 33,020 5,045 5,045 - 87 5,132
Fund balance, end of year 33,620$ 5,645$ 5,370$ (275)$ 11$ 5,381$
152Attachment 1, Page 152 of 218
Capital Projects Funds
The City has four nonmajor capital projects funds. The combining Balance Sheet and the combining Statement of Revenues, Expenditures and Changes in Fund Balance for these funds are presented here. The combined totals are reported on the combining nonmajor governmental fund statements. Schedules of revenues, expenses, and changes in fund balance – budget and actual are presented here for each individual capital projects fund. Nonmajor Capital Projects Funds: Development Assessments Capital Projects Fund – This fund is used to account for costs of constructing public improvements. Financing is provided by assessing benefiting property owners. Development Capital Projects Fund – This fund is used to account for costs of constructing and improving City-owned buildings and for infrastructure projects with shared funding. Financing is provided by grants, contracts, intergovernmental revenues, and other non-recurring revenues. SEDA Glenwood Capital Projects Fund – This fund is used to account for capital projects undertaken by the Springfield Economic Development Agency in Glenwood. Tax increment financing is in place. Street Capital Projects Fund – This fund accounts for public transportation capital improvement costs and local capacity-increasing public transportation improvements. Financing is provided by transfers from the Street Fund, interest on investments, and system development charges.
153Attachment 1, Page 153 of 218
154Attachment 1, Page 154 of 218
Development SEDA
Assessments Development Glenwood Street
Capital Capital Capital Capital
Projects Projects Projects Projects Total
ASSETS
Cash and investments 522,321$ 4,377,922$ 233$ 3,963,312$ 8,863,788$
Receivables:
Accounts - - - 19,368 19,368
Accrued interest 1,713 13,606 - 11,068 26,387
Assessments and liens 61,697 - - - 61,697
Deferred system development fees - - - 928,915 928,915
Total assets 585,731$ 4,391,528$ 233$ 4,922,663$ 9,900,155$
LIABILITIES, DEFERRED INFLOWS OF
RESOURCES, AND FUND BALANCES
Liabilities:
Accounts payable -$ 8,530$ -$ 80,002$ 88,532$
Accrued payroll and other liabilities 371 - - - 371
Deposits - - - 53,075 53,075
Total liabilities 371 8,530 - 133,077 141,978
Deferred inflows of resources:
Unavailable revenue 61,697 - - 948,284 1,009,981
Fund balances:
Restricted - 1,574,516 233 3,841,302 5,416,051
Committed 523,663 2,046,255 - - 2,569,918
Assigned - 762,227 - - 762,227
Total fund balances 523,663 4,382,998 233 3,841,302 8,748,196
Total liabilities, deferred inflows of
resources, and fund balances 585,731$ 4,391,528$ 233$ 4,922,663$ 9,900,155$
City of Springfield, Oregon
NONMAJOR CAPITAL PROJECTS FUNDS
BALANCE SHEET
June 30, 2019
155Attachment 1, Page 155 of 218
Development SEDAAssessmentsDevelopmentGlenwood Street
Capital Capital Capital Capital
Projects Projects Projects Projects TotalRevenues:Intergovernmental revenues -$ -$ -$ 122,276$ 122,276$
Charges for services - 300,257 - 662,648 962,905 Investment earnings 15,206 116,963 - 90,243 222,412
Special assessments 17,098 - - - 17,098
Miscellaneous revenue - 374,090 - 115,876 489,966
Total revenues 32,304 791,310 - 991,043 1,814,657
Expenditures:
Current operating:General government 41,210 - - - 41,210 Capital projects - 188,311 - 296,002 484,313
Total expenditures 41,210 188,311 - 296,002 525,523
Excess of revenues over(under) expenditures (8,906) 602,999 - 695,041 1,289,134
Other financing sources (uses):Transfer in - 113,029 - 150,000 263,029
Transfer out - (81,803) - - (81,803)
Total other financing sources (uses)- 31,226 - 150,000 181,226
Net change in fund balances (8,906) 634,225 - 845,041 1,470,360
Fund balance, beginning of year 532,569 3,748,773 233 2,996,261 7,277,836
Fund balance, end of year 523,663$ 4,382,998$ 233$ 3,841,302$ 8,748,196$
Year Ended June 30, 2019
NONMAJOR CAPITAL PROJECTS FUNDS
City of Springfield, Oregon
STATEMENT OF REVENUES, EXPENDITURES, AND CHANGES IN FUND BALANCES
156Attachment 1, Page 156 of 218
City of Springfield, Oregon
DEVELOPMENT ASSESSMENTS CAPITAL PROJECTS FUND
SCHEDULE OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCE
(NONGAAP BUDGETARY BASIS) - BUDGET AND ACTUAL
Year Ended June 30, 2019
AdjustmentsBudgetto Budget GAAPOriginalRevisedBasisBasisBasisBudgetBudgetActualVarianceActualActualRevenues:Investment earnings 11,200$ 11,200$ 15,356$ 4,156$ (150)$ 15,206$ Special assessments 20,200 20,200 17,098 (3,102) - 17,098
Total revenues 31,400 31,400 32,454 1,054 (150) 32,304
Expenditures:Current operating:Finance 58,357 58,357 41,210 17,147 - 41,210
Net change in fund balance (26,957) (26,957) (8,756) 18,201 (150) (8,906)
Fund balance, beginning of year 539,611 531,227 531,227 - 1,342 532,569
Fund balance, end of year 512,654$ 504,270$ 522,471$ 18,201$ 1,192$ 523,663$
157Attachment 1, Page 157 of 218
City of Springfield, Oregon
DEVELOPMENT CAPITAL PROJECTS FUND
SCHEDULE OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCE
(NONGAAP BUDGETARY BASIS) - BUDGET AND ACTUAL
Year Ended June 30, 2019
AdjustmentsBudgetto Budget GAAPOriginalRevisedBasisBasisBasisBudgetBudgetActualVarianceActualActualRevenues:Charges for services 300,276$ 300,276$ 300,257$ (19)$ -$ 300,257$ Investment earnings 76,693 76,693 116,969 40,276 (6) 116,963 Miscellaneous revenue 119,895 123,403 374,090 250,687 - 374,090
Total revenues 496,864 500,372 791,316 290,944 (6) 791,310
Expenditures:Capital projects 253,473 385,010 192,148 192,862 (3,837) 188,311
Excess of revenues over(under) expenditures 243,391 115,362 599,168 483,806 3,831 602,999
Other financing sources (uses):Interfund loans issued (847,000) (847,000) - 847,000 - - Transfer in 35,000 113,029 113,029 - - 113,029 Transfer out (81,803) (81,803) (81,803) - - (81,803)
Total other financing sources (uses)(893,803) (815,774) 31,226 847,000 - 31,226
Net change in fund balances (650,412) (700,412) 630,394 1,330,806 3,831 634,225
Fund balance, beginning of year 3,479,075 3,743,138 3,743,139 1 5,634 3,748,773
Fund balance, end of year 2,828,663$ 3,042,726$ 4,373,533$ 1,330,807$ 9,465$ 4,382,998$
158Attachment 1, Page 158 of 218
City of Springfield, Oregon
SEDA GLENWOOD CAPITAL PROJECTS
SCHEDULE OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCE
(NONGAAP BUDGETARY BASIS) - BUDGET AND ACTUAL
Year Ended June 30, 2019
AdjustmentsBudgetto Budget GAAPOriginalRevisedBasisBasisBasisBudgetBudgetActualVarianceActualActual
Fund balance, beginning of year -$ -$ 233$ 233$ -$ 233$
Fund balance, end of year -$ -$ 233$ 233$ -$ 233$
159Attachment 1, Page 159 of 218
City of Springfield, Oregon
STREET CAPITAL PROJECTS FUND
SCHEDULE OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCE
(NONGAAP BUDGETARY BASIS) - BUDGET AND ACTUAL
Year Ended June 30, 2019
AdjustmentsBudgetto Budget GAAP
Original Revised Basis Basis Basis
Budget Budget Actual Variance Actual ActualRevenues:
19,000$ 19,000$ 89,164$ 70,164$ 1,079$ 90,243$ Charges for services 450,000 450,000 662,648 212,648 - 662,648 Miscellaneous revenue - 168,951 115,876 (53,075) - 115,876
- 99,125 122,276 23,151 - 122,276
Total revenues 469,000 737,076 989,964 252,888 1,079 991,043
Expenditures:
Current operating
Development and public works 97,543 97,543 - 97,543 - - Capital projects 1,831,364 4,599,440 296,002 4,303,438 - 296,002
Total expenditures 1,928,907 4,696,983 296,002 4,400,981 - 296,002
(under) expenditures (1,459,907) (3,959,907) 693,962 4,653,869 1,079 695,041
Other financing sources (uses):Transfer in 150,000 2,650,000 150,000 (2,500,000) - 150,000
Net change in fund balance (1,309,907) (1,309,907) 843,962 2,153,869 1,079 845,041
2,770,604 2,989,642 2,989,642 - 6,619 2,996,261
1,460,697$ 1,679,735$ 3,833,604$ 2,153,869$ 7,698$ 3,841,302$
Investment earnings
Intergovernmental revenue
Excess of revenues over
Fund balance, beginning of year
Fund balance, end of year
160Attachment 1, Page 160 of 218
Enterprise Funds
Combining statements for all individual nonmajor enterprise funds are reported in this section. Fund statements for major enterprise funds are reported in the basic financial statements.
Schedules of revenues, expenses, and changes in fund net position – budget and actual are presented here for each individual enterprise fund.
Major Enterprise Funds: Sewer Fund – This fund accounts for the operation, construction, and maintenance of the wastewater collection system. Primary revenues are sewer user fees and system development charges. Storm Drainage Fund – This fund accounts for the operation, construction, and maintenance of the stormwater drainage system. Primary revenues are storm drainage fees and system development charges. Ambulance Fund – This fund accounts for the City’s ambulance operations. Revenue sources include ambulance transport fees, ambulance billing services fees, and FireMed program memberships.
Nonmajor Enterprise Funds: Booth-Kelly Fund – This fund accounts for the cost of managing and maintaining City-owned
income properties. The primary revenue source is rental income.
161Attachment 1, Page 161 of 218
162Attachment 1, Page 162 of 218
City of Springfield, Oregon
SEWER FUND
SCHEDULE OF REVENUES, EXPENSES AND CHANGES IN FUND NET POSITION
(NONGAAP BUDGETARY BASIS) - BUDGET AND ACTUAL
Year Ended June 30, 2019
AdjustmentsBudgetto Budget GAAPOriginalRevisedBasisBasisBasisBudgetBudgetActualVarianceActualActualRevenues:
Charges for services 7,631,000$ 7,631,000$ 7,513,298$ (117,702)$ 28,452$ 7,541,750$ Investment earnings 225,000 225,000 612,724 387,724 1,346 614,070 Miscellaneous revenue - - 628 628 - 628
Total revenues 7,856,000 7,856,000 8,126,650 270,650 29,798 8,156,448
Expenses:Current operating:Information technology 340,427 360,426 257,142 103,284 - 257,142 Development and public works 3,691,181 3,691,181 3,316,341 374,840 245,616 3,561,957 Finance 15,748 15,747 14,833 914 - 14,833 Debt service:Principal 1,245,000 1,245,000 1,245,000 - (1,245,000) - Interest 466,355 466,355 466,350 5 (76,271) 390,079 Capital projects 4,683,513 4,683,513 847,810 3,835,703 (847,810) - Depreciation - - - - 2,917,992 2,917,992
Total expenses 10,442,224 10,462,222 6,147,476 4,314,746 994,527 7,142,003
Excess of revenues over(under) expenses (2,586,224) (2,606,222) 1,979,174 4,585,396 (964,729) 1,014,445
Other financing sources (uses):Capital contributions 970,000 970,000 734,608 (235,392) 501,159 1,235,767 Transfers in - - - - 32,022 32,022
Total other financing sources (uses) 970,000 970,000 734,608 (235,392) 533,181 1,267,789 Excess of revenues and other financing sources over (under) Change in net position (1,616,224) (1,636,222) 2,713,782 4,350,004 (431,548) 2,282,234
Net position, beginning of year 21,707,250 22,084,550 22,084,550 - 45,645,328 67,729,878
Net position, end of year 20,091,026$ 20,448,328$ 24,798,332$ 4,350,004$ 45,213,780$ 70,012,112$
163Attachment 1, Page 163 of 218
City of Springfield, Oregon
STORM DRAINAGE FUND
SCHEDULE OF REVENUES, EXPENSES AND CHANGES IN FUND NET POSITION
(NONGAAP BUDGETARY BASIS) - BUDGET AND ACTUAL
Year Ended June 30, 2019
AdjustmentsBudgetto Budget GAAPOriginalRevisedBasisBasisBasisBudgetBudgetActualVarianceActualActualRevenues:
Charges for services 7,308,000$ 7,308,000$ 7,220,843$ (87,157)$ 38,865$ 7,259,708$ Investment earnings 298,000 298,000 484,481 186,481 (509) 483,972 Miscellaneous revenue 33,300 33,300 211,457 178,157 (174,515) 36,942
Total revenues 7,639,300 7,639,300 7,916,781 277,481 (136,159) 7,780,622
Expenses:Current operating:Information technology 264,539 284,539 198,296 86,243 - 198,296 Development and public works 5,312,048 5,316,048 4,743,231 572,817 327,658 5,070,889 Finance 15,758 15,759 14,672 1,087 - 14,672 Debt service:Principal 450,000 450,000 450,000 - (450,000) - Interest 258,052 258,052 258,050 2 (29,428) 228,622 Capital projects 4,968,907 4,968,907 194,499 4,774,408 (194,499) - Depreciation - - - - 433,590 433,590
Total expenses 11,269,304 11,293,305 5,858,748 5,434,557 87,321 5,946,069
Excess of revenues over(under) expenses (3,630,004) (3,654,005) 2,058,033 5,712,038 (223,480) 1,834,553
Other financing sources (uses):Capital contributions 310,000 310,000 273,600 (36,400) 1,031,138 1,304,738 Transfers out - - - - (32,022) (32,022)
Total other financing sources/(uses) 310,000 310,000 273,600 (36,400) 999,116 1,272,716
Change in net position (3,320,004) (3,344,005) 2,331,633 5,675,638 775,636 3,107,269
Net position, beginning of year 17,598,627 17,744,503 17,744,503 - 3,934,176 21,678,679
Net position, end of year 14,278,623$ 14,400,498$ 20,076,136$ 5,675,638$ 4,709,812$ 24,785,948$
164Attachment 1, Page 164 of 218
City of Springfield, Oregon
AMBULANCE FUND
SCHEDULE OF REVENUES, EXPENSES AND CHANGES IN FUND NET POSITION
(NONGAAP BUDGETARY BASIS) - BUDGET AND ACTUAL
Year Ended June 30, 2019
AdjustmentsBudgetto Budget GAAPOriginalRevisedBasisBasisBasisBudgetBudgetActualVarianceActualActualRevenues:Licenses, permits and fees -$ -$ 257,464$ 257,464$ (178,604)$ 78,860$ Charges for services 5,705,000 5,770,400 5,862,188 91,788 13,921,643 19,783,831 Less: Contractual adjustments - - - - (12,780,341) (12,780,341) Intergovernmental revenue 204,000 261,070 44,168 (216,902) 192,113 236,281 Investment earnings 15,000 15,000 44,762 29,762 (1,585) 43,177 Miscellaneous revenue 7,000 7,000 10,785 3,785 - 10,785
Total revenues 5,931,000 6,053,470 6,219,367 165,897 1,153,226 7,372,593
Expenses:Current operating:Fire and life safety 6,645,435 6,767,905 6,542,731 225,174 707,088 7,249,819 Depreciation - - - - 8,390 8,390
Total expenses 6,645,435 6,767,905 6,542,731 225,174 715,478 7,258,209
Excess of revenues over(under) expenses (714,435) (714,435) (323,364) 391,071 437,748 114,384
Other financing sources (uses):Transfer out (250,000) (250,000) - 250,000 - -
Change in net position (964,435) (964,435) (323,364) 641,071 437,748 114,384
Net position, beginning of year 1,111,447 1,711,246 1,711,246 - (3,161,733) (1,450,487)
Net position, end of year 147,012$ 746,811$ 1,387,882$ 641,071$ (2,723,985)$ (1,336,103)$
165Attachment 1, Page 165 of 218
City of Springfield, Oregon
BOOTH-KELLY FUND
SCHEDULE OF REVENUES, EXPENSES AND CHANGES IN FUND NET POSITION
(NONGAAP BUDGETARY BASIS) - BUDGET AND ACTUAL
Year Ended June 30, 2019
AdjustmentsBudgetto Budget GAAPOriginalRevisedBasisBasisBasisBudgetBudgetActualVarianceActualActualRevenues:Charges for services 1,572,032$ 1,572,032$ 1,481,729$ (90,303)$ (191)$ 1,481,538$ Investment earnings 10,000 10,000 35,203 25,203 369 35,572
Total revenues 1,582,032 1,582,032 1,516,932 (65,100) 178 1,517,110
Expenses:Current operating:Development and public works 546,569 546,569 440,355 106,214 10,565 450,920 Capital projects 226,000 226,000 - 226,000 - - Debt service:Principal 739,420 739,420 739,418 2 (739,418) - Interest 26,025 26,025 26,027 (2) (4,295) 21,732 Depreciation - - - - 828,698 828,698
Total expenses 1,538,014 1,538,014 1,205,800 332,214 95,550 1,301,350
Excess of revenues over(under) expenses 44,018 44,018 311,132 267,114 (95,372) 215,760
Other financing sources (uses):Transfers out (67,548) (67,548) (67,548) - - (67,548)
Change in net position (23,530) (23,530) 243,584 267,114 (95,372) 148,212
Net position, beginning of year 1,061,131 1,246,704 1,246,704 - 4,031,952 5,278,656
Net position, end of year 1,037,601$ 1,223,174$ 1,490,288$ 267,114$ 3,936,580$ 5,426,868$
166Attachment 1, Page 166 of 218
Internal Service Funds
Combining statements for all internal service funds are reported here. The combined totals are reported alongside the individual enterprise funds in the basic financial statements. Schedules of revenues, expenses, and changes in fund net position – budget and actual are presented here for each individual internal service fund. Vehicle and Equipment Fund – This fund accounts for the ownership and use of major
equipment. Resources are provided by charges to other City funds. Insurance Fund – This fund accounts for the accumulation of resources to provide for the City’s
insurance, the worker’s compensation program, and the employee benefits programs. Resources are provided by charges to other City funds.
SDC Administration Fund – This fund accounts for the activities required to administer the City’s various system development charges. Resources are provided primarily by charges to other City funds.
167Attachment 1, Page 167 of 218
168Attachment 1, Page 168 of 218
City of Springfield, Oregon
INTERNAL SERVICE FUNDS
COMBINING STATEMENT OF FUND NET POSITION
Vehicleand SDCEquipmentInsuranceAdministration TotalASSETSCurrent assets:Cash and investments 9,350,049$ 11,757,683$ 556,698$ 21,664,430$ Prepaids 39,817 2,697 - 42,514 Deposits - 200,000 - 200,000 Accounts receivable 28,431 15,493 15,263 59,187 Accrued interest receivable 29,226 34,419 2,349 65,994 Deferred system development fees - - 84,798 84,798 Inventory 35,209 - - 35,209
Total current assets 9,482,732 12,010,292 659,108 22,152,132
Noncurrent assetsCapital assetsMachinery and equipment 18,713,214 - - 18,713,214 Less accumulated depreciation (13,341,625) - - (13,341,625)
Total noncurrent assets 5,371,589 - - 5,371,589
Total assets 14,854,321 12,010,292 659,108 27,523,721
DEFERRED OUTFLOWS OF RESOURCESDeferred pension outflow - 121,309 124,145 245,454 Deferred OPEB outflow - 4,180 4,218 8,398
Total deferred outflows - 125,489 128,363 253,852
LIABILITIESCurrent liabilities:Accounts payable 94,499 1,461,809 1,671 1,557,979 Accrued interest payable 1,447 - - 1,447 Capital lease obligation, current portion 146,970 - - 146,970 Accrued claims liabilities, current portion - 413,701 - 413,701 Accrued payroll and otherrelated liabilities - 262,221 7,953 270,174 Deposits 5,286 - - 5,286 Unearned revenue - 29,912 - 29,912
Total current liabilities 248,202 2,167,643 9,624 2,425,469
Noncurrent liabilities:Accrued absence payable - 10,250 - 10,250 Capital lease obligation, less current portion 150,385 - - 150,385 Accrued claims liabilities, less current portion - 301,299 - 301,299 Net pension liability - 319,125 334,305 653,430 Net OPEB obligation - 32,223 25,996 58,219
Total noncurrent liabilities 150,385 662,897 360,301 1,173,583
Total liabilities 398,587 2,830,540 369,925 3,599,052
DEFERRED INFLOWS OF RESOURCESDeferred pension inflow - 25,261 25,271 50,532 Deferred OPEB Inflow - 14,929 13,819 28,748
Total deferred inflows - 40,190 39,090 79,280
NET POSITIONNet investment in capital assets 5,074,234 - - 5,074,234 Unrestricted 9,381,500 9,265,051 378,456 19,025,007
Total net position 14,455,734$ 9,265,051$ 378,456$ 24,099,241$
June 30, 2019
169Attachment 1, Page 169 of 218
City of Springfield, Oregon
INTERNAL SERVICE FUNDSCOMBINING STATEMENT OF REVENUES, EXPENSES AND
CHANGES IN FUND NET POSITION
Year ended June 30, 2019
Vehicleand SDCEquipmentInsuranceAdministration TotalOperating revenues: Intergovernmental revenue 345,455$ -$ -$ 345,455$ Charges for services 2,228,499 10,128,853 7,838 12,365,190Licenses and permits - - 128,399 128,399 Miscellaneous revenue 28,000 192,676 - 220,676 Total operating revenues 2,601,954 10,321,529 136,237 13,059,720
Operating expenses:Current operating:Human resources - 9,936,506 - 9,936,506 Finance 4,132 - 18,419 22,551 Information technology 149,728 - 53,707 203,435 Library 7,261 - - 7,261 Fire and life safety 58,555 - - 58,555 Police 289,227 - - 289,227 Development and public works 505,606 - 384,336 889,942 Depreciation 1,210,143 - - 1,210,143
Total operating expenses 2,224,652 9,936,506 456,462 12,617,620
Operating income 377,302 385,023 (320,225) 442,100
Nonoperating revenues (expenses):Interest income 237,300 279,105 19,014 535,419 Interest expense (9,547) - - (9,547) Gain/(loss) on disposition of equipment (2,994) - - (2,994)
Total nonoperating revenues (expenses)224,759 279,105 19,014 522,878
Income before capital contributions and transfers 602,061 664,128 (301,211) 964,978
Transfers out - (113,029) - (113,029)
Change in net position 602,061 551,099 (301,211) 851,949
Net position, beginning of year 13,853,673 8,713,952 679,667 23,247,292
Net position, end of year 14,455,734$ 9,265,051$ 378,456$ 24,099,241$
170Attachment 1, Page 170 of 218
City of Springfield, Oregon
COMBINING STATEMENT OF CASH FLOWS
Year ended June 30, 2019
Vehicleand SDCEquipmentInsuranceAdministration TotalCash flows from operating activities: Cash received from interfund services provided 2,243,494$ 10,124,085$ (23,016)$ 12,344,563$ Cash paid for employee services - (310,221) (323,087) (633,308) Cash paid to suppliers for goods and services (1,143,429) (8,917,238) (98,195) (10,158,862) Other operating receipts 373,455 192,676 128,399 694,530
Net cash provided by operating activities 1,473,520 1,089,302 (315,899) 2,246,923
Cash flows from noncapital financing activities: Transfers to other funds - (113,029) - (113,029)
Cash flows from capital and related financing activities: Acquisition of capital assets (707,352) - - (707,352) Disposition of capital assets (14,663) - - (14,663) Principal paid on long-term debt (143,635) - - (143,635) Interest paid (10,246) - - (10,246)
Net cash used in capital and related financing activities (875,895) - - (875,895)
Cash flows from investing activities: Interest received 236,521 280,425 19,451 536,397
Net change in cash and investments 834,146 1,256,698 (296,448) 1,794,396 Cash and investments, beginning of year 8,515,903 10,500,985 853,146 19,870,034
Cash and investments, end of year 9,350,049$ 11,757,683$ 556,698$ 21,664,430$
Reconciliation of operating loss to net cash provided by (used in) operating activities:
Operating income 377,302$ 385,023$ (320,225)$ 442,100$ Adjustments to reconcile operating income to net cash provided by operating activities: Depreciation 1,210,143 - - 1,210,143 Changes in assets and liabilities: Prepaids (19,005) 72,930 - 53,925 Accounts receivable 14,995 (4,768) (30,854) (20,627) Deposits 5,286 - - 5,286 Inventory (8,598) - - (8,598) Net pension liability and related deferrals - 30,661 39,652 70,313 Accounts payable (106,603) 549,714 612 443,723 Accrued payroll and other liabilities - 15,493 41 15,534 Accrued claims liabilities - 7,000 - 7,000 Unearned revenue - 29,912 - 29,912 Net OPEB obligation and related deferrals - 3,337 (5,125) (1,788)
Net cash provided by operating activities 1,473,520$ 1,089,302$ (315,899)$ 2,246,923$
INTERNAL SERVICE FUNDS
171Attachment 1, Page 171 of 218
City of Springfield, Oregon
VEHICLE AND EQUIPMENT FUND
SCHEDULE OF REVENUES, EXPENSES AND CHANGES IN FUND NET POSITION
(NONGAAP BUDGETARY BASIS) - BUDGET AND ACTUAL
Year ended June 30, 2019
AdjustmentsBudgetto Budget GAAPOriginalRevisedBasisBasisBasisBudgetBudgetActualVarianceActualActualRevenues:Intergovernmental revenue -$ 345,455$ 345,455$ -$ -$ 345,455$ Charges for services 2,153,812 2,153,812 2,227,935 74,123 564 2,228,499 Investment earnings 113,524 113,524 237,372 123,848 (72) 237,300 Miscellaneous revenue - - 43,337 43,337 (15,337) 28,000
Total revenues 2,267,336 2,612,791 2,854,099 241,308 (14,845) 2,839,254
Expenses:Current operating:Finance 8,400 8,400 4,132 4,268 - 4,132 Information technology 258,831 258,831 176,727 82,104 (26,999) 149,728 Library 8,000 8,000 7,261 739 - 7,261 Fire and life safety 408,200 801,213 413,703 387,510 (355,148) 58,555 Police 400,000 552,000 542,458 9,542 (253,231) 289,227 Development and public works 479,491 1,231,674 577,580 654,094 (71,974) 505,606 Debt service:Principal 143,635 143,635 143,634 1 (143,634) - Interest 10,248 10,248 10,247 1 (700) 9,547 Depreciation - - - - 1,210,143 1,210,143
Total expenses 1,716,805 3,014,001 1,875,742 1,138,259 358,457 2,234,199
Excess of revenues over(under) expenses 550,531 (401,210) 978,357 1,379,567 (373,302) 605,055
Other financing sources (uses):Gain on disposal of assets - - - - (2,994) (2,994)
Change in net position 550,531 (401,210) 978,357 1,379,567 (376,296) 602,061
Net position, beginning of year 8,382,476 - 5,471,197 13,853,673
Net position, end of year 8,551,843$ 7,981,266$ 9,360,833$ 1,379,567$ 5,094,901$ 14,455,734$
172Attachment 1, Page 172 of 218
City of Springfield, Oregon
INSURANCE FUNDSCHEDULE OF REVENUES, EXPENSES AND CHANGES IN FUND NET POSITION(NONGAAP BUDGETARY BASIS) - BUDGET AND ACTUAL
Year ended June 30, 2019
AdjustmentsBudgetto Budget GAAPOriginalRevisedBasisBasisBasisBudgetBudgetActualVarianceActualActualRevenues:Charges for services 20,895,331$ 20,895,331$ 20,365,813$ (529,518)$ (10,236,960)$ 10,128,853$ Investment earnings 65,000 65,000 280,795 215,795 (1,690) 279,105 Miscellaneous revenue 65,000 65,000 196,286 131,286 (3,610) 192,676
Total revenues 21,025,331 21,025,331 20,842,894 (182,437) (10,242,260) 10,600,634
Expenses:Current operating:Human resources 1,369,541 1,386,341 1,127,073 259,268 1,095,038 2,222,111 Health insurance 8,586,936 8,586,936 7,339,467 1,247,469 374,928 7,714,395 Statutory payments 11,528,110 11,528,110 11,218,473 309,637 (11,218,473) -
Total expenses 21,484,587 21,501,387 19,685,013 1,816,374 (9,748,507) 9,936,506
Excess of revenues over(under) expenses (459,256) (476,056) 1,157,881 1,633,937 (493,753) 664,128
Other financing sources (uses):Transfers out (35,000) (113,029) (113,029) - - (113,029)
Change in net position (494,256) (589,085) 1,044,852 1,633,937 (493,753) 551,099
Net position, beginning of year 10,100,055 10,016,792 10,016,792 - (1,302,840) 8,713,952
Net position, end of year 9,605,799$ 9,427,707$ 11,061,644$ 1,633,937$ (1,796,593)$ 9,265,051$
173Attachment 1, Page 173 of 218
City of Springfield, Oregon
SDC ADMINISTRATION FUND
SCHEDULE OF REVENUES, EXPENSES AND CHANGES IN FUND NET POSITION
(NONGAAP BUDGETARY BASIS) - BUDGET AND ACTUAL
Year ended June 30, 2019
AdjustmentsBudgetto Budget GAAPOriginalRevisedBasisBasisBasisBudgetBudgetActualVarianceActualActualRevenues:Charges for services 375,000$ 375,000$ 549$ (374,451)$ 7,289$ 7,838$ Licenses and permits 100,000 100,000 104,834 4,834 23,565 128,399 Investment earnings 7,000 7,000 19,378 12,378 (364) 19,014
Total revenues 482,000 482,000 124,761 (357,239) 30,490 155,251
Expenses:Current operating:Information services 66,954 66,954 53,707 13,247 - 53,707 Finance 22,856 22,856 18,419 4,437 - 18,419 Development and public works 434,859 434,859 349,808 85,051 34,528 384,336
Total expenses 524,669 524,669 421,934 102,735 34,528 456,462
Change in net position (42,669) (42,669) (297,173) (254,504) (4,038) (301,211)
Net position, beginning of year 716,259 844,961 844,961 - (165,294) 679,667
Net position, end of year 673,590$ 802,292$ 547,788$ (254,504)$ (169,332)$ 378,456$
174Attachment 1, Page 174 of 218
Fiduciary Funds
Agency funds are used to account for assets held by the government as an agent for individuals, private organizations, and other governments. Statement of changes in assets and liabilities of the Agency Fund is presented here. Agency Fund – The Agency Fund is a non-budgeted fund which accounts for resources received
and held by the City in a fiduciary capacity. Disbursements from this fund are made in accordance with the applicable agreements for each type of transaction. This fund is custodial in nature (assets equal liabilities) and does not involve measurement of the results of operations.
175Attachment 1, Page 175 of 218
176Attachment 1, Page 176 of 218
Beginning EndingBalanceAdditionsReductionsBalance
ASSETSCash and investments 89,741,230$ 71,579,906$ (75,351,818)$ 85,969,318$
LIABILITIESAccounts payable 504,069$ 7,403,608$ (7,528,415)$ 379,262$ Health reimbursement account deposits 1,408,904 889,879 (830,167) 1,468,616 Ambulance billing deposits 1,241,412 13,735,126 (13,801,967) 1,174,571 Bail deposits 520,123 1,107,659 (1,342,606) 285,176 Miscellaneous deposits 572,328 1,749,801 (1,620,767) 701,362 Regional Fiber Consortium deposits 234,520 679,569 (644,916) 269,173 Metropolitan Wastewater Management Commission deposits 85,259,874 248,943,571 (252,512,287) 81,691,158
Total liabilities 89,741,230$ 274,509,213$ (278,281,125)$ 85,969,318$
STATEMENT OF CHANGES IN ASSETS AND LIABILITIES
AGENCY FUND
Year Ended June 30, 2019
City of Springfield, Oregon
177Attachment 1, Page 177 of 218
178Attachment 1, Page 178 of 218
Statistical Section
This part of the City of Springfield’s comprehensive annual financial report presents detailed information as a context for understanding what the information in the financial statements, note disclosures, and required supplementary information says about the City’s overall financial
health.
Contents Page Financial Trends 183-187
These schedules contain trend information to help the reader understand how the City’s financial performance and well-being have changed over time. Revenue Capacity 191-194 These schedules contain information to help the reader assess the City’s most significant local revenue source, the property tax. Debt Capacity 197-201 These schedules present information to help the reader assess the affordability of the City’s current levels of outstanding debt and the City’s ability to issue additional debt in the future. Demographic and Economic Information 205-206 These schedules offer demographic and economic indicators to help the reader
understand the environment within which the City’s financial activities take place.
Operating Information 209-211 These schedules contain service and infrastructure data to help the reader understand how the information in the City’s financial report relates to the services the City provides and the activities it performs. Sources: Unless otherwise noted, the information in these schedules is derived from the comprehensive annual financial reports for the relevant year.
179Attachment 1, Page 179 of 218
180Attachment 1, Page 180 of 218
Financial Trend Information
181Attachment 1, Page 181 of 218
182Attachment 1, Page 182 of 218
2010 2011 2012 2013 2014 2015 2016 2017 2018 2019
Governmental activities
Net investment in capital assets 107,712,593$ 109,751,002$ 108,631,529$ 108,731,315$ 107,219,252$ 112,632,832$ 115,176,581$ 122,230,625$ 120,175,702$ 129,324,764$
Restricted 5,268,152 12,102,762 11,424,559 13,171,125 14,144,006 18,977,155 17,357,721 17,295,648 22,674,644 20,647,784
Unrestricted 29,581,397 20,196,736 21,514,015 19,835,794 20,240,783 4,394,678 (5,988,448) (11,706,242) (15,369,959) (11,948,772)
Total governmental activities net position 142,562,142$ 142,050,500$ 141,570,103$ 141,738,234$ 141,604,041$ 136,004,665$ 126,545,854$ 127,820,031$ 127,480,387$ 138,023,776$
Business-type activities
Net investment in capital assets 48,338,342$ 51,248,289$ 57,872,702$ 51,972,745$ 54,491,005$ 52,836,347$ 54,212,835$ 54,802,364$ 55,901,549$ 57,366,837$
Restricted 2,989,453 3,091,423 3,236,454 3,273,179 3,072,205 3,348,526 3,976,909 4,733,337 5,457,331 6,575,305
Unrestricted 12,562,982 15,019,532 13,474,770 22,668,331 23,137,298 27,590,908 28,145,472 31,242,641 32,027,245 34,958,604
Total business-type activities net position 63,890,777$ 69,359,244$ 74,583,926$ 77,914,255$ 80,700,508$ 83,775,781$ 86,335,216$ 90,778,342$ 93,386,125$ 98,900,746$
Primary government
Net investment in capital assets 156,050,935$ 165,468,108$ 166,504,231$ 160,704,060$ 161,710,257$ 165,469,179$ 169,389,416$ 177,032,989$ 176,077,251$ 186,691,601$
Restricted 8,257,605 15,194,185 14,661,013 16,444,304 17,216,211 22,325,681 21,334,630 22,028,985 28,131,975 27,223,089
Unrestricted 42,144,379 35,216,268 34,988,785 42,504,125 43,378,081 31,985,586 22,157,024 19,536,399 16,657,286 23,009,832
Total primary government net position 206,452,919$ 215,878,561$ 216,154,029$ 219,652,489$ 222,304,549$ 219,780,446$ 212,881,070$ 218,598,373$ 220,866,512$ 236,924,522$
Source: Financial Statements
City of Springfield, Oregon
Net Position by Component
Last Ten Fiscal Years
(accrual basis of accounting)
Fiscal Year
183Attachment 1, Page 183 of 218
Continued
2010 2011 2012 2013 2014 2015 2016 2017 2018 2019
ExpensesGovernmental activities:General government 3,560,757$ 5,386,231$ 4,724,454$ 5,932,778$ 4,928,452$ 5,194,119$ 8,055,900$ 8,105,716$ 7,450,495$ 8,570,530$
Fire and life safety 10,691,161 11,760,498 11,847,128 11,340,166 11,736,970 9,905,694 14,789,977 13,351,001 13,890,821 14,187,421 Police 17,259,569 18,444,853 19,694,617 19,561,178 20,708,780 18,007,975 26,060,501 22,068,423 22,233,956 23,962,665 Library 1,382,782 1,513,148 1,519,866 1,515,697 1,508,178 1,477,854 2,131,183 1,981,508 1,727,501 2,065,860 Development and public works 13,560,283 12,804,723 11,384,695 11,658,254 11,925,811 10,605,607 15,857,538 12,483,443 12,687,939 13,921,361
Depreciation, unallocated 283,227 283,227 284,439 297,774 270,618 270,619 250,942 207,852 250,435 207,852 Interest on long-term debt 1,373,371 1,301,309 1,220,457 1,143,393 1,027,212 909,122 744,674 518,495 457,480 488,109 Total governmental activities expense 48,111,150 51,493,989 50,675,656 51,449,240 52,106,021 46,370,990 67,890,715 58,716,438 58,698,627 63,403,798
Business-type activities:
Sanitary sewer 4,803,431 4,886,099 5,190,475 6,155,571 6,848,708 6,340,495 7,523,149 7,158,008 7,269,835 7,304,346 Storm drainage 3,956,135 4,031,641 3,843,225 3,984,400 4,407,437 4,259,913 5,982,172 5,559,128 6,316,516 5,968,181 Booth Kelly 1,433,965 1,334,099 1,430,803 1,463,621 1,611,902 1,649,088 1,507,253 1,424,527 1,410,609 1,300,368
Ambulance 5,000,748 5,202,146 5,184,271 4,948,503 5,525,464 5,082,272 7,073,633 6,574,936 6,515,453 7,212,214 Business-type activities expenses 15,194,279 15,453,985 15,648,774 16,552,095 18,393,511 17,331,768 22,086,207 20,716,599 21,512,413 21,785,109 Total primary government expenses 63,305,429$ 66,947,974$ 66,324,430$ 68,001,335$ 70,499,532$ 63,702,758$ 89,976,922$ 79,433,037$ 80,211,040$ 85,188,907
Program Revenue
Govermental activities:Charges for services:General government 1,940,273$ 3,360,519$ 3,759,347$ 3,874,817$ 3,766,791$ 3,868,870$ 3,888,018$ 4,078,095$ 4,248,830$ 4,194,777$
Fire and life safety 1,716,417 1,725,642 1,764,798 1,769,064 1,874,473 1,809,091 1,921,748 1,984,859 1,916,552 2,012,641 Police 246,682 513,759 529,998 493,254 429,497 408,750 346,629 422,625 715,863 1,041,123 Library 103,475 97,718 99,186 105,329 102,737 125,482 106,200 120,912 117,114 118,372 Development and public works 2,168,001 1,544,638 1,749,513 2,263,872 2,054,066 2,710,606 3,420,717 2,884,311 2,626,049 2,880,108
Operating grants and contributions 6,436,204 5,616,572 5,514,649 4,428,156 5,039,850 4,444,185 4,184,978 4,954,592 5,135,869 5,626,172 Capital grants and contributions 3,994,233 3,661,254 1,109,866 2,192,135 481,598 9,934,788 4,841,296 4,085,842 2,177,260 4,181,484 Total governmental activities program revenues 16,605,285 16,520,102 14,527,357 15,126,627 13,749,012 23,301,772 18,709,586 18,531,236 16,937,537 20,054,677
Business-type activities:Charges for services:Sanitary sewer 6,325,689 6,927,642 7,261,314 7,324,173 7,536,486 7,738,487 7,224,927 8,798,173 7,709,636 7,541,750 Storm drainage 4,984,732 5,694,208 5,789,080 6,032,530 6,347,901 6,613,264 6,892,114 7,408,192 7,194,627 7,259,708
Booth Kelly 1,381,649 1,443,802 1,412,841 1,348,308 1,355,337 1,412,722 1,532,687 1,537,293 1,630,764 1,481,538 Ambulance 4,834,330 5,173,527 4,849,894 5,255,068 5,612,386 6,119,908 6,599,690 6,046,048 5,383,760 7,239,771 Capital grants and contributions 1,001,635 1,129,770 1,448,360 16,729 16,848 199,269 2,088,254 1,033,069 1,164,761 2,540,505
Total business-type activities program revenues 18,528,035 20,368,949 20,761,489 19,976,808 20,868,958 22,083,650 24,337,672 24,822,775 23,083,548 26,063,272 Total primary government program revenues 35,133,320$ 36,889,051$ 35,288,846$ 35,103,435$ 34,617,970$ 45,385,422$ 43,047,258$ 43,354,011$ 40,021,085$ 46,117,949$
Net (Expense) RevenueGovernmental activities (31,505,865)$ (34,973,887)$ (36,148,299)$ (36,322,613)$ (38,357,009)$ (23,069,218)$ (49,181,129)$ (40,227,785)$ (41,761,090)$ (43,349,121)$ Business-type activities 3,333,756 4,914,964 5,112,715 3,424,713 2,475,447 4,751,882 2,251,465 4,106,176 1,571,135 4,278,163Total primary government net expense (28,172,109)$ (30,058,923)$ (31,035,584)$ (32,897,900)$ (35,881,562)$ (18,317,336)$ (46,929,664)$ (36,121,609)$ (40,189,955)$ (39,070,958)$
Fiscal Year
City of Springfield, OregonChanges in Net Position, Last Ten Fiscal years(accrual basis of accounting) 184Attachment 1, Page 184 of 218
Continued
2010 2011 2012 2013 2014 2015 2016 2017 2018 2019General Revenues and Other Changes in Net Position
Governmental activities:Taxes:Property taxes 26,616,211$ 25,890,066$ 27,056,405$ 27,891,748$ 28,735,713$ 30,497,567$ 29,449,109$ 30,691,286$ 30,910,303$ 33,272,981$ Room tax 679,566 777,085 901,665 973,830 1,070,722 1,219,497 1,373,464 1,445,031 1,553,872 1,356,155
Other taxes 3,088,825 3,018,549 2,744,424 2,754,883 3,158,101 3,288,462 3,387,888 3,446,975 3,567,850 3,473,477 Payment in lieu of taxes 2,346,889 2,373,660 2,358,273 2,375,949 2,390,734 2,404,859 2,392,729 2,353,365 2,414,018 2,403,565 Investment earnings 664,423 421,956 337,514 333,178 361,323 305,267 416,909 573,280 783,330 1,557,790
Miscellaneous 201,184 486,358 727,049 985,770 908,413 857,657 867,789 972,473 1,345,586 1,351,036 Gain (loss) on disposition of capital assets (57,355) - - - - - 149,687 - - - Shared revenue 1,247,546 1,387,527 1,400,459 1,460,463 1,533,466 1,579,978 1,584,743 2,019,553 1,743,533 2,026,255 Transfers (30,673) 107,047 142,115 71,894 64,344 71,311 100,000 - 63,000 67,548
Total governmental activities 34,756,616 34,462,248 35,667,904 36,847,715 38,222,816 40,224,598 39,722,318 41,501,963 42,381,492 45,508,807 Business-type activities:Investment earnings 409,360 292,416 237,091 211,730 282,238 162,671 227,641 317,398 528,250 1,176,791
Miscellaneous 186,763 368,134 16,990 78,204 92,912 446,106 180,329 19,552 209,703 127,215
Transfers 30,673 (107,047) (142,115) (71,894) (64,344) (71,311) (100,000) - (63,000) (67,548) Total business-type activities 626,796 553,503 111,966 218,040 310,806 537,466 307,970 336,950 674,953 1,236,458 Total primary government 35,383,412$ 35,015,751$ 35,779,870$ 37,065,755$ 38,533,622$ 40,762,064$ 40,030,288$ 41,838,913$ 43,056,445$ 46,745,265$
Change In Net PositionGovernmental activities (217,271)$ (1,686,051)$ (654,709)$ (1,509,294)$ (134,193)$ 17,155,380$ (9,458,811)$ 1,316,761$ 620,402$ 2,159,686$ Business-type activities 5,541,760 5,666,218 3,536,679 2,693,487 2,786,253 5,289,348 2,559,435 4,443,126 2,246,088 5,514,621 Total primary government 5,324,489$ 3,980,167$ 2,881,970$ 1,184,193$ 2,652,060$ 22,444,728$ (6,899,376)$ 5,759,887$ 2,866,490$ 7,674,307$
Fiscal Year
185Attachment 1, Page 185 of 218
2010 2011 2012 2013 2014 2015 2016 2017 2018 2019
General FundReserved 10,546$ -$ -$ -$ -$ -$ -$ -$ -$ -$
Unreserved 7,843,269 - - - - - - - - - Nonspendable - 5,420 5,589 49,644 22,109 86,584 98,292 83,602 64,408 118,343
Restricted - 600,000 632 - - - - - - - Committed - 65,721 37,863 12,764 25,902 83,224 172,840 293,004 293,004 472,153
Assigned - 39,224 600,000 600,000 600,000 600,000 600,000 1,000,000 1,000,000 1,000,000 Unassigned - 6,872,613 7,134,387 7,538,441 7,698,382 8,553,497 7,999,863 7,387,428 8,388,052 9,176,504
Total general fund 7,853,815$ 7,582,978$ 7,778,471$ 8,200,849$ 8,346,393$ 9,323,305$ 8,870,995$ 8,764,034$ 9,745,464$ 10,767,000$
All Other Governmental FundsReserved 4,492,479$ -$ -$ -$ -$ -$ -$ -$ -$ -$
Unreserved. reported in:Special revenue funds 4,459,760 - - - - - - - - -
Capital projects funds 4,030,636 - - - - - - - - - Debt service funds 1,257,621 - - - - - - - - -
Nonspendable - 179,198 160,531 151,297 147,593 205,477 223,261 219,897 243,998 520,564 Restricted - 7,022,919 8,020,323 8,535,571 9,060,917 13,642,430 14,194,470 13,672,194 18,873,553 16,461,113
Committed - 4,546,915 4,024,188 3,130,187 2,460,530 2,617,234 1,980,130 2,036,262 2,200,742 2,569,918 Assigned - 1,009,473 426,016 410,941 443,945 644,492 1,493,031 808,377 920,076 1,261,961
Unassigned - - - (26,365) (64,907) (23,321) (37,306) (142,091) - -
Total all other governmental funds 14,240,496$ 12,758,505$ 12,631,058$ 12,201,631$ 12,048,078$ 17,086,312$ 17,853,586$ 16,594,639$ 22,238,369$ 20,813,556$
Fiscal Year
City of SpringfieldFund Balances, Governmental FundsLast Ten Fiscal Years(modified accrual basis of accounting) 186Attachment 1, Page 186 of 218
2010 2011 2012 2013 2014 2015 2016 2017 2018 2019
Revenue:Taxes 28,121,897$ 28,169,922$ 28,838,941$ 30,059,119$ 31,087,716$ 33,065,500$ 31,862,305$ 33,098,818$ 33,794,986$ 36,634,081$
Licenses and permits 2,583,181 2,538,309 2,300,827 2,463,338 2,700,850 2,783,280 3,122,149 3,325,162 3,251,909 3,184,547
Intergovernmental 9,857,571 9,405,123 8,974,691 8,475,485 8,576,500 12,172,857 8,484,882 9,224,182 9,515,619 10,388,913
Charges for services 7,041,256 7,417,478 6,958,019 7,022,389 7,142,048 7,670,658 9,247,507 8,410,972 8,740,655 8,255,515
Fines & forfeitures 1,437,612 1,807,580 1,736,722 1,497,458 1,673,933 1,688,251 1,652,415 1,655,009 1,813,942 1,819,429
Use of money & property 452,130 263,317 170,279 191,559 141,996 109,373 170,631 276,286 427,571 1,017,688
Special assessments 10,856 25,625 48,934 42,569 31,651 45,618 25,265 18,989 13,082 17,098
Miscellaneous revenue 267,380 664,045 648,988 306,085 570,176 708,847 775,308 743,777 785,899 1,205,665
Total Revenues 49,771,883 50,291,399 49,677,401 50,058,002 51,924,870 58,244,384 55,340,462 56,753,195 58,343,663 62,522,936
Expenditures:
Current Operating:
General government 5,536,753 5,825,159 6,083,214 6,306,579 6,042,155 6,643,279 8,240,463 8,509,994 7,901,804 8,571,201
Fire and life safety 10,651,586 11,373,445 11,514,553 11,242,700 11,515,444 11,237,818 11,848,268 12,380,622 12,894,682 13,114,125 Police 16,185,060 16,757,981 17,744,329 18,318,088 19,118,811 18,997,316 20,231,011 19,388,013 19,748,479 21,115,709
Library 1,360,464 1,375,033 1,426,083 1,457,714 1,440,438 1,610,330 1,706,475 1,848,510 1,646,799 1,904,135
Development and public works 12,085,092 10,925,370 9,283,821 9,041,272 9,427,305 9,233,725 9,063,061 9,285,822 9,036,058 9,628,378
Capital Projects 12,119,784 2,845,047 1,001,890 789,407 1,232,663 1,354,801 2,187,974 6,204,622 967,170 6,095,447
Debt service:
Principal 2,173,240 2,251,618 2,330,192 2,418,973 2,507,974 2,602,206 1,630,000 2,156,706 1,695,530 2,021,673
Interest 1,364,942 1,283,376 1,197,635 1,108,223 1,011,446 913,103 807,469 650,730 653,657 674,222
Bond issue costs - - - - - - 131,205 - - -
Arbitrage 49,406 - - - - - - - - -
Total expenditures 61,526,327 52,637,029 50,581,717 50,682,956 52,296,236 52,592,578 55,845,926 60,425,019 54,544,179 63,124,890
Excess of revenues over
(under) expenditures (11,754,444) (2,345,630) (904,316) (624,954) (371,366) 5,651,806 (505,464) (3,671,824) 3,799,484 (601,954)
Other financing sources (uses):
Transfers in 4,647,041 4,050,527 5,079,050 5,073,111 4,754,376 4,874,912 6,369,454 1,775,328 2,729,248 1,458,838 Transfers out (4,146,202) (3,458,750) (4,120,498) (4,458,815) (4,409,317) (4,506,705) (5,801,301) (1,459,296) 1,229,455 (1,278,261)
Issuance of debt - - - - - - 16,994,808 2,000,000 (1,166,455) -
Payment to refunded bond escrow agent - - - - - - (16,863,603) - - -
Total other financing sources (uses)500,839 591,777 958,552 614,296 345,059 368,207 699,358 2,316,032 2,792,248 180,577
Net changes in fund balances (11,253,605)$ (1,753,853)$ 54,236$ (10,658)$ (26,307)$ 6,020,013$ 193,894$ (1,355,792)$ 6,591,732$ (421,377)$
Debt services as a percentage of non-capital expenditures *7.14%7.03%7.09%7.05%6.83%6.84%4.59%5.21%4.39%4.71%
(modified accrual basis of accounting)
Fiscal Year
City of Springfield
Changes in Fund Balances, Governmental Funds
Last ten fiscal years
187Attachment 1, Page 187 of 218
188Attachment 1, Page 188 of 218
Revenue Capacity Information
189Attachment 1, Page 189 of 218
190Attachment 1, Page 190 of 218
Fiscal year
ended June 30, Real Property
Manufactured
Structures
Personal
Property Utilities
Total Taxable
Assessed Value
Including Urban Renewal and
Exempt Property
Total City Direct Tax
Rate
Total
Urban Renewal
Tax Rate
Estimated Actual
Taxable Value
2010 ****3,726,631,985$ 7.13 0.11 7,309,497,628$
2011 ****3,747,745,557 7.06 0.09 6,750,427,991
2012 ****3,883,712,564 6.99 0.09 6,716,253,056
2013 ****3,998,513,269 6.94 0.15 6,399,350,681
2014 ****4,043,528,204 7.15 0.18 6,450,348,959
2015 ****4,253,901,084 7.03 0.22 6,782,631,808
2016 ****4,339,850,283 6.78 0.21 6,939,893,310
2017 ****4,471,924,355 6.79 0.21 7,145,332,593
2018 ****4,624,303,479 6.68 0.24 7,841,457,283
2019 4,541,773,087 29,429,233 197,693,142 88,220,300 4,857,115,762 6.77 0.30 8,492,723,597
Source: Lane County Department of Assessment and Taxation
* Breakdown of assessed value into categories is not available
City of Springfield, Oregon
ASSESSED VALUE AND ACTUAL VALUE OF TAXABLE PROPERTY
Last Ten Fiscal Years
191Attachment 1, Page 191 of 218
Fiscal
Year
Basic
Rate
General
Obligation
Debt
Service
Police
Operating
Levy
Fire
Operating
Levy
Total
Direct
School
District
No. 19
Lane
County
Lane
Community
College
Lane
County
I.E.D.
(E.S.D.)
Willamalane
Park District
Springfield
Economic
Development
Agency
2010 4.70 0.94 1.09 0.40 7.13 5.59 1.38 0.85 0.22 1.99 0.11
2011 4.71 0.86 1.09 0.40 7.06 5.60 1.38 0.85 0.22 1.99 0.09
2012 4.71 0.84 1.09 0.36 6.99 5.63 1.38 0.87 0.22 1.99 0.09
2013 4.68 0.82 1.09 0.36 6.94 5.63 1.37 0.85 0.22 1.98 0.15
2014 4.67 0.84 1.28 0.36 7.15 5.61 1.91 0.85 0.22 2.42 0.18 2015 4.65 0.74 1.28 0.36 7.03 5.61 1.91 0.85 0.22 2.33 0.22 2016 4.65 0.49 1.28 0.36 6.78 5.79 1.80 0.81 0.22 2.30 0.21 2017 4.65 0.50 1.28 0.36 6.79 5.88 1.65 0.83 0.22 2.31 0.21 2018 4.64 0.40 1.28 0.36 6.68 5.84 1.64 0.83 0.22 2.28 0.24 2019 4.62 0.39 1.40 0.36 6.77 5.78 1.77 0.83 0.22 2.25 0.30
Source: Lane County Department of Assessment & Taxation
Overlapping RatesCity Direct Rates
City of Springfield, Oregon
PROPERTY TAX RATES - DIRECT AND OVERLAPPING GOVERNMENTS
Last Ten Fiscal Years
192Attachment 1, Page 192 of 218
Percentage PercentageTaxableof Total City Taxable of Total City
Assessed Taxable Assessed Taxable
Taxpayer Value Rank *Assessed Value Value Rank *Assessed Value
IP Eat Three LLC (Weyerhauser)307,230,254$ 1 6.33%196,148,058$ 1 5.26%PeaceHealth 473,085,851 2 9.74%293,157,502 3 7.87%Gateway Mall Partners 75,125,501 3 1.55%57,854,704 4 1.55%McKenzie Willamette Hospital 63,108,805 4 1.30%21,669,902 9 0.58%PacificSource Properties LLC 42,839,994 5 0.88%- -Rosboro LLC 37,849,980 6 0.78%31,085,137 5 0.83%
Borden Chemical Inc 29,941,115 7 0.62%- -
HSRE NW Spec Clinics Mob LLC 29,542,738 8 0.61%- -
United States Bakery 29,386,258 9 0.61%- -RC Springfield 2007 LLC 27,042,740 10 0.56%22,086,216 7 0.59%Symantec Corporation - -77,524,843 2 2.08%Kingsford Manufacturing - -25,104,328 8 0.67%Comcast Corporation - -27,229,200 6 0.73%Brentwood Estates LLC - -18,375,885 10 0.49%
Total 1,115,153,236$ 22.96%770,235,775$ 20.67%
Source: Lane County Department of Assessment and Taxation
City of Springfield, Oregon
PRINCIPAL PROPERTY TAX PAYERS
Current Year and Nine Years Ago
2019 2010
193Attachment 1, Page 193 of 218
Amount
Percentage
of Levy Amount
Percentage
of Levy
2010 27,170,891$ 25,473,655$ 93.8%1,578,792$ 27,052,447$ 99.56%
2011 26,956,427 25,339,490 94.0%1,493,287 26,832,777 99.54%
2012 27,667,002 26,127,844 94.4%1,411,491 27,539,335 99.54%
2013 28,646,245 26,967,621 94.1%1,528,148 28,495,769 99.47%
2014 29,539,586 27,866,138 94.3%1,508,620 29,374,758 99.44%2015 31,427,683 29,665,353 94.4%1,544,561 31,209,914 99.31%
2016 30,360,092 28,616,502 94.3%1,503,897 30,120,399 99.21%
2017 31,525,757 29,852,562 94.7%1,304,237 31,156,799 98.83%
2018 32,210,580 30,617,910 95.1%1,029,269 31,647,179 98.25%
2019 34,341,345 32,759,524 95.4%976,702 33,736,226 98.24%
Sources:Lane County Department of Assessments and
Taxation; Annual Financial Reports
City of Springfield, Oregon
PROPERTY TAX LEVIES AND COLLECTIONS
Last Ten Fiscal Years
Collected within the Fiscal Year
of the Levy
Total Collections and
Adjustments to Date
Collections &
Adjustments
Fiscal
Year
Ended
June 30,
Taxes Levied
for the Fiscal
Year
194Attachment 1, Page 194 of 218
Debt Capacity Information
195Attachment 1, Page 195 of 218
196Attachment 1, Page 196 of 218
Fiscal Year
General
Obligation
Bonds Capital Leases Notes Payable
Contracts
Payable
Revenue
Bonds Notes Payable
Total Primary
Government
Percentage
of Personal
Income Per Capita
2010 29,464,188$ 1,382,311$ 1,920,962$ 210,000$ 23,463,735$ 6,697,965$ 63,139,161$ 0.54%1,063
2011 27,217,526 1,108,535 1,699,344 210,000 32,916,000 5,834,566 68,985,971 0.56%1,156
2012 25,130,137 1,114,360 1,469,152 210,000 31,445,204 5,068,098 64,436,951 0.50%1,077
2013 22,964,771 1,756,347 1,230,179 210,000 29,929,407 4,404,011 60,494,715 0.46%1,008
2014 20,597,007 1,227,516 977,206 210,000 28,363,611 3,695,017 55,070,357 0.41%917
2015 18,400,955 676,209 715,000 210,000 26,752,681 3,011,742 49,766,587 0.34%828
2016 17,194,064 535,062 520,000 210,000 25,318,704 2,198,125 45,975,955 0.30%764
2017 15,717,891 789,049 1,873,246 210,000 23,123,478 1,494,105 43,207,769 0.27%712
2018 13,992,095 440,990 4,296,965 210,000 21,190,522 739,418 40,869,990 *674
2019 13,243,365 297,355 3,720,293 210,000 19,317,564 505,833 37,294,410 *608
Source: Annual Financial Reports
* not yet available
City of Springfield, Oregon
RATIO OF OUTSTANDING DEBT, BY TYPE
Last Ten Fiscal Years
Business-Type ActivitiesGovernmental Activities
197Attachment 1, Page 197 of 218
Fiscal
Year
General Obligation
Bonds
Percentage of
Actual Taxable
Value of Property Per Capita
2010 29,464,188$ 0.79%503
2011 27,217,526 0.73%458
2012 25,130,137 0.65%421
2013 22,964,771 0.57%383
2014 20,597,007 0.51%343
2015 18,400,955 0.43%306
2016 17,194,064 0.40%286
2017 15,717,891 0.35%260
2018 13,992,095 0.30%230
2019 13,243,365 0.27%216
Source:Annual Financial Statements, Lane County Department of Assessment & Taxation
Population Research Center Portland State University
City of Springfield, Oregon
RATIO OF GENERAL BONDED DEBT OUTSTANDING
Last Ten Fiscal Years
198Attachment 1, Page 198 of 218
Governmental Unit Debt Outstanding
City of Springfield - general obligation bonds 13,243,366$ 100.00%13,243,366$
City of Springfield - notes payable 3,720,292 100.00%3,720,292
City of Springfield - contracts payable 210,000 100.00%210,000
City of Springfield - capital leases 297,355 100.00%297,355
Total Direct debt 17,471,013$ 17,471,013$
Overlapping Debt
Lane Community College 100,900,000$ 14.71%14,841,886$
Lane County 71,928,282 14.92%10,730,117
School District 19 156,993,582 75.81%118,032,014
School District 4J 430,439,572 4.87%20,977,473
Lane Education Service District 6,140,000 14.96%918,243
Willamalane Park & Recreation District 15,789,483 94.02%14,844,782
Goshen RFPD 286,075 0.52%1,484
Lane County Housing Authority 9,200,000 14.92%1,372,438
Total overlapping debt 791,676,994 181,718,437
Total direct and overlapping debt 199,189,450$
Source:Oregon State Treasury
Notes:
a. Overlapping governments are those that coincide, at least in part, with the geographic boundaries of the City. This
schedule estimates the portion of the outstanding debt of those overlapping governments that is borne by the residents and businesses of the City. The State of Oregon, Debt Management Division, provides overlapping debt data based on
real market valuation of properties for each jurisdiction.
b. Total direct debt and overlapping debt is total direct debt plus gross overlapping debt.
City of Springfield, Oregon
COMPUTATION OF DIRECT AND OVERLAPPING DEBT
June 30, 2019
Percentage applicable City's share of
199Attachment 1, Page 199 of 218
June 30, 2019
Real market value 8,492,723,597$
Debt limit 3% of real market value 254,781,708$
Amount of debt applicable to debt limit:11,630,000
Total debt margin 243,151,708$
2010 2011 2012 2013 2014 2015 2016 2017 2018 2019
Debt Limit 219,284,929$ 202,512,840$ 201,487,592$ 191,980,520$ 193,510,469$ 203,478,954$ 208,196,799$ 214,359,978$ 235,243,718$ 254,781,708$
Total net debt applicable to limit 29,210,296 27,242,807 25,845,000 23,665,000 21,410,000 19,070,000 15,975,000 14,465,000 13,075,000 11,630,000
Legal debt margin 190,074,633$ 175,270,033$ 175,642,592$ 168,315,520$ 172,100,469$ 184,408,954$ 192,221,799$ 199,894,978$ 222,168,718$ 243,151,708$
Total net debt applicable to the limit 13.32%13.45%12.83%12.33%11.06%9.37%7.67%6.75%5.56%4.56%
as a percentage of debt limit
Source: Lane County Assessment & TaxationCity of Springfield Financials
City of Springfield, Oregon
LEGAL DEBT MARGIN INFORMATION
LAST TEN FISCAL YEARS
Fiscal Year
200Attachment 1, Page 200 of 218
Fiscal
Year System Revenues
Less:
Operating
Expenses
Net Available
Revenue Principal Interest Coverage
2010 11,893,479$ 6,947,301$ 4,946,178$ 860,000$ 1,094,244$ 2.53
2011 13,149,688 7,299,130 5,850,558 1,025,000 1,088,793 2.77
2012 13,275,335 7,010,679 6,264,656 1,420,000 1,231,306 2.36
2013 13,602,039 7,715,412 5,886,627 1,465,000 1,188,956 2.22
2014 14,102,581 7,954,941 6,147,640 1,515,000 1,144,050 2.31
2015 14,819,959 7,270,726 7,549,233 1,560,000 1,097,325 2.84
2016 15,814,960 9,925,186 5,889,774 1,380,000 1,039,531 2.43
2017 17,544,930 8,584,216 8,960,714 1,425,000 988,281 3.71
2018 16,755,001 9,117,789 7,637,212 1,755,000 656,409 3.17
2019 17,132,240 9,117,789 8,014,451 1,740,000 673,400 3.32
Source:Annual Financial Reports
System revenues include user fees, system development charges and miscellaneous revenue.
Operating expenses do not include depreciation or interest expense.
City of Springfield, Oregon
Pledged-Revenue Coverage
Last Ten Fiscal Years
Debt Service
Local Sewer Revenue Bonds
201Attachment 1, Page 201 of 218
202Attachment 1, Page 202 of 218
Demographic and Economic Information
203Attachment 1, Page 203 of 218
204Attachment 1, Page 204 of 218
Personal Per
Income Capita
(thousands Personal School Unemployment
Year Population of dollars)Income Enrollment Rate
2010 59,425 11,669,824$ 33,160$ 10,622 11.0%
2011 59,695 12,235,553 34,614 10,565 9.9%
2012 59,840 12,784,129 36,062 10,494 8.9%
2013 59,990 13,047,961 36,630 10,479 8.0%
2014 60,065 13,392,647 37,374 10,384 6.9%
2015 60,135 14,597,955 40,259 10,249 5.9%
2016 60,140 15,160,278 41,027 10,315 5.3%
2017 60,655 16,275,200 43,430 10,366 4.6%
2018 60,865 *47,710 10,133 3.8%
2019 61,355 ***4.5%
Sources: Population information provided by the Population Research Center, Portland State University.
Personal income and Per Capita income provided by Bureau of Economic Analysis and represents
all of Lane County; for FY2018, Per Capica Income is from the U.S. Census: data.census.gov
Beginning with FY2018, Per Capita Personal Income becoming unavailable, we are reporting Lane County
Median Household Income derived from the U.S. Census: data.census.gov
School enrollment data provided by Springfield School District No. 19.
Unemployment data provided by Bureau of Labor Statistics, United States Department of Labor and
represents the adjusted yearly average for the entire Eugene-Springfield Metropolitan area
* Not yet available
City of Springfield, Oregon
Demographic and Economic Statistics
Last Ten Calendar Years
205Attachment 1, Page 205 of 218
Percentage
Estimated average of Total City
Employer**Employees Rank Employment
Peace Health Oregon Region 3,000 1 10.72%
Springfield School District #19 1,560 2 5.58%
Top 3 Technology employers 1,180 3 4.22%
McKenzie Willamette Hospital 850 4 3.04%
Top 3 Wood product employers 820 5 2.93%
Top 3 Food and beverage employers 490 6 1.75%
City of Springfield 402 7 1.44%
Willamalane Park and Recreational District 362 8 1.29%
State Government 320 9 1.14%
Federal Government 204 10 0.73%
Total 9,188 32.84%
Percentage
Estimated average of Total City
Employer Employees Rank Employment
Peace Health Oregon Region 3,350 1 13.75%
Springfield School District #19 1,403 2 5.76%
Symantic 1,253 3 5.14%
McKenzie Willamette Hospital 780 4 3.20%
City of Springfield 454 5 1.86%
Wal-Mart 425 6 1.74%
Willamalane Park and Recreation District 329 7 1.35%
Rosboro Lumber Company 320 8 1.31%
Royal Caribbean Cruise Lines 307 9 1.26%
Lane Transit District 304 10 1.25%
Total 8,925 36.62%
Source: City Economic Development Division
** Due to confidentiality - the department of labor no longer discloses
employee numbers for private companies.
City of Springfield, Oregon
Principal Employers
Current Year and Nine Years Ago
2019
2010
206Attachment 1, Page 206 of 218
Operating Information
207Attachment 1, Page 207 of 218
208Attachment 1, Page 208 of 218
2010 2011 2012 2013 2014 2015 2016 2017 2018 2019
Function/Program
General government
City management 8.00 8.00 7.00 7.00 7.00 7.50 7.50 7.50 7.00 7.00
Finance 10.30 10.30 9.80 9.50 9.50 9.50 11.70 11.70 9.70 9.70
Human resources 6.00 6.00 6.00 6.00 6.00 6.00 6.00 8.00 8.00 7.00
Information technology 10.00 10.00 10.00 10.00 10.00 10.00 15.00 15.00 14.80 15.80
Legal/Judicial services 8.55 8.55 8.85 8.84 8.84 8.84 8.84 8.84 8.84 11.84
Police 123.00 126.00 124.16 122.99 122.99 123.00 123.00 124.00 123.00 123.00
Fire and Life Safety 108.00 106.00 103.00 101.00 100.00 99.00 99.00 97.50 95.75 101.65
Development and public works 155.75 149.25 140.75 130.56 129.75 130.00 123.00 123.00 126.38 126.55
Library 13.20 13.40 12.40 12.60 12.60 13.10 13.50 13.50 14.13 15.06
Total 442.80 437.50 421.96 408.49 406.68 406.94 407.54 409.04 407.60 417.60
Source: City Budget Office- Based on published Budgeted FTE as of July 1, preceding year
City of Springfield, Oregon
Full-time Equivalent City Government Employees by Function/Program
Last Ten Fiscal Years
209Attachment 1, Page 209 of 218
2010 2011 2012 2013 2014 2015 2016 2017 2018 2019Function/Program
PoliceCriminal arrests (charges)7,107 7,527 7,148 8,577 9,221 7,672 8,506 9,348 9,367 8,462
Parking violations 354 ***237 185 360 209 244 607 558 818Traffic violations 9,423 10,299 10,122 10,648 7,517 7,775 8,219 8,087 7,997 7,644
Fire and life safetyNumber of fire stations 5 5 5 5 5 5 5 5 5 5Incident responses ****8,076 8,651 8,626 8,625 8,714 9,283
Fire incidents ****206 177 185 167 162 180Inspections ****121 138 123 214 262 257
Library Number of public computer log-ins 60,335 59,994 46,797 64,065 70,756 56,666 53,733 25,683 21,958 22,220Total volumes loaned 344,809 344,586 354,120 354,538 354,503 365,497 364,823 355,848 365,763 376,622
Development and public worksCrack sealing (in miles)12 9 3 40 28 11 12 0.14 2 4
Potholes repaired 1,569 1,062 1,364 1,124 1,047 775 ******1,103 1,634Storm lines high velocity cleaning (in feet)7,810 9,452 3,835 1,909 1,811 2,200 1,500 2,000 4,661 20,000Sanitary lines high velocity cleaning (in feet)965,853 653,641 652,069 587,954 363,748 426,466 601,920 786,000 646,635 510,000
Number of building permits **491 400 428 382 433 466 224 427 1,541 2,236Building valuation (in thousands)$ 48,150 $ 38,067 $ 40,698 $ 44,388 $ 44,621 $ 51,818 $ 77,150 91,011$ 71,631$ 88,928$
Sources: Various city departments*City of Eugene provides Fire and life safety statistics - between 2011 and 2014, the Cities of Eugene and Springfield were working through a merger of the departments.
From 2014 on, the statics represent Incident Responses, Fire Incidents and Inspections done inside the City of Springfield by employees who may be Springfield employeesor Eugene employees. Prior to 2014, comparable data is unavailable.
**New constructions permits
***Data not available
City of Springfield, Oregon
Operating Indicators by Function/Program
Last Ten Fiscal Years
210Attachment 1, Page 210 of 218
2010 2011 2012 2013 2014 2015 2016 2017 2018 2019Function/Program
Police Stations 1 1 1 1 1 1 1 1 1 1
Patrol units 20 20 20 20 20 20 20 24 24 26Fire stations 5 5 5 5 5 5 5 5 5 5
Public worksStreets (lane miles)412 420 423 423 423 444 442 443 447 447
Street lights 4,160 4,208 4,350 4,530 4,300 4,362 4,338 4,227 4,431 4,518Traffic signals 69 68 73 83 68 83 93 78 72 44 *
Sources: Various city departments*Number of traffic signals for 2019 includes only those owned by Springfield. Prior years include signals installed within Springfield but owned by ODOT(Oregon Department of Transportation)
City of Springfield, Oregon
Capital Asset Statistics by Function/Program
Last Ten Fiscal Years
211Attachment 1, Page 211 of 218
212Attachment 1, Page 212 of 218
Compliance Section
213Attachment 1, Page 213 of 218
214Attachment 1, Page 214 of 218
Audit Comments
215Attachment 1, Page 215 of 218
216Attachment 1, Page 216 of 218
475 Cottage Street NE, Suite 200, Salem, Oregon 97301
(503) 581-7788
INDEPENDENT AUDITOR’S REPORT
REQUIRED BY OREGON STATE REGULATIONS
To the Honorable Mayor, Members of the
City Council and the City Manager
City of Springfield
225 5th Street
Springfield, Oregon 97477
We have audited, 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, the basic financial statements of the City of Springfield, Oregon
as of and for the year ended June 30, 2019, and have issued our report thereon dated December 27, 2019.
Compliance and Order Matters
As part of obtaining reasonable assurance about whether the City's financial statements are free of material
misstatement, we performed tests of its compliance with certain provisions of laws, regulations, contracts,
and grants, including the provisions of Oregon Revised Statutes as specified in Oregon Administrative
Rules 162-10-000 through 162-10-320 of the Minimum Standards for Audits of Oregon Municipal
Corporations, noncompliance with which could have a direct and material effect on the determination of
financial statements amounts. However, providing an opinion on compliance with those provisions was not
an objective of our audit, and accordingly, we do not express such an opinion.
We performed procedures to the extent we considered necessary to address the required comments and
disclosures which included, but were not limited to the following:
Deposit of public funds with financial institutions (ORS Chapter 295).
Indebtedness limitations, restrictions and repayment.
Budgets legally required (ORS Chapter 294).
Insurance and fidelity bonds in force or required by law.
Programs funded from outside sources.
Highway revenues used for public highways, roads, and streets.
Authorized investment of surplus funds (ORS Chapter 294).
Public contracts and purchasing (ORS Chapters 279A, 279B, 279C).
Accountability for collecting or receiving money by elected officials - no money was collected
or received by elected officials.
In connection with our testing nothing came to our attention that caused us to believe the City was not in
substantial compliance with certain provisions of laws, regulations, contracts, and grants, including the
provisions of Oregon Revised Statutes as specified in Oregon Administrative Rules 162-10-000 through
162-10-320 of the Minimum Standards for Audits of Oregon Municipal.
217Attachment 1, Page 217 of 218
Internal Control Over Financial Reporting
In planning and performing our audit of the financial statements, we considered the City's internal control
over financial reporting to determine the audit procedures that are appropriate in the circumstances for the
purpose of expressing our opinion on the financial statements, but not for the purpose of expressing an
opinion on the effectiveness of the City's internal control over financial reporting. Accordingly, we do not
express an opinion on the effectiveness of the City's internal control.
Restriction on Use
This report is intended solely for the information and use of the Honorable Mayor, City Council and
management of the City of Springfield, Oregon and the Oregon Secretary of State and is not intended to be
and should not be used by anyone other than these parties.
GROVE, MUELLER & SWANK, P.C.
CERTIFIED PUBLIC ACCOUNTANTS
By:
Ryan T. Pasquarella, A Shareholder
December 27, 2019
218Attachment 1, Page 218 of 218
475 Cottage Street NE, Suite 200, Salem, Oregon 97301
(503) 581-7788
December 27, 2019
To the Honorable Mayor, Members of the
City Council and the City Manager
City of Springfield
225 5th Street
Springfield, Oregon 97477
We have audited the financial statements of the City of Springfield and the Springfield Economic Development
Agency (collectively known as the City) as of and for the year ended June 30, 2019, and have issued our report
thereon dated December 27, 2019. Professional standards require that we advise you of the following matters relating
to our audit.
Our Responsibility in Relation to the Financial Statement Audit
As communicated in our engagement letter dated May 31, 2019, our responsibility, as described by professional
standards, is to form and express opinions about whether the financial statements that have been prepared by
management with your oversight are presented fairly, in all material respects, in accordance with accounting
principles generally accepted in the United States of America. Our audit of the financial statements does not relieve
you or management of your respective responsibilities.
Our responsibility, as prescribed by professional standards, is to plan and perform our audit to obtain reasonable,
rather than absolute, assurance about whether the financial statements are free of material misstatement. An audit of
financial statements includes consideration of internal control over financial reporting as a basis for designing audit
procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the
effectiveness of the City’s internal control over financial reporting. Accordingly, as part of our audit, we considered
the internal control of the City solely for the purpose of determining our audit procedures and not to provide any
assurance concerning such internal control.
We are also responsible for communicating significant matters related to the audit that are, in our professional
judgment, relevant to your responsibilities in overseeing the financial reporting process. However, we are not
required to design procedures for the purpose of identifying other matters to communicate to you.
Compliance with All Ethics Requirements Regarding Independence
The engagement team, others in our firm, as appropriate, and our firm have complied with all relevant ethical
requirements regarding independence.
Attachment 2, Page 1 of 11
Qualitative Aspects of the City’s Significant Accounting Practices
Significant Accounting Policies
Management has the responsibility to select and use appropriate accounting policies. A summary of the significant
accounting policies adopted by the City is included in the notes to the financial statements. The City implemented
one new pronouncement:
GASB Statement No. 88, “Certain Disclosures Related to Debt, including Direct Borrowings and Direct
Placements,” addresses inconsistencies in the information disclosed in the notes to governmental financial
statements related to debt, including direct borrowings and direct placements, and provides financial statement
users with additional essential information about debt.
No matters have come to our attention that would require us, under professional standards, to inform you about (1)
the methods used to account for significant unusual transactions and (2) the effect of significant accounting policies
in controversial or emerging areas for which there is a lack of authoritative guidance or consensus.
Significant Accounting Estimates
Accounting estimates are an integral part of the financial statements prepared by management and are based on
management’s current judgments. Those judgments are normally based on knowledge and experience about past and
current events and assumptions about future events. Certain accounting estimates are particularly sensitive because
of their significance to the financial statements and because of the possibility that future events affecting them may
differ markedly from management’s current judgments.
The most sensitive accounting estimates affecting the financial statements are:
Management’s estimate of other post-employment benefits, based on calculations from an independent third-
party actuary.
Management’s estimate of the net pension liability related to OPERS and the City Retirement Plan, based
on calculations from an independent third-party actuary.
Management’s estimate of the carrying value of capital assets, based on management's determination of the
useful lives and future economic benefit of the assets.
Management’s estimate of the allowance for doubtful accounts, based on past experience with uncollected
accounts.
Management’s estimate of the fair market value of investments, based on third-party brokerage information.
Management’s estimate of the self-insured health insurance liability, based on claims actually paid following
year-end.
Management’s estimate of the self-insured workers compensation liability, based on calculations from an
independent third-party actuary.
We evaluated the key factors and assumptions used to develop the estimates and determined that they are reasonable
in relation to the basic financial statements taken as a whole and in relation to the applicable opinion units.
Significant Difficulties Encountered during the Audit
We encountered no significant difficulties in dealing with management relating to the performance of the audit.
Attachment 2, Page 2 of 11
Uncorrected and Corrected Misstatements
For purposes of this communication, professional standards require us to accumulate all known and likely
misstatements identified during the audit, other than those that we believe are trivial, and communicate them to the
appropriate level of management. Further, professional standards require us to also communicate the effect of
uncorrected misstatements related to prior periods on the relevant classes of transactions, account balances or
disclosures, and the financial statements as a whole and each applicable opinion unit. The attached schedule
summarizes uncorrected financial statement misstatements whose effects in the current period, as detertmined by
management, are immaterial, both individually and in the aggregate, to the financial statements taken as a whole.
In addition, professional standards require us to communicate to you all material, corrected misstatements that were
brought to the attention of management as a result of our audit procedures. None of the City of Springfield
misstatements identified by us as a result of our audit procedures and corrected by management were material, either
individually or in the aggregate, to the financial statements taken as a whole or applicable opinion units. There was
a Springfield Economic Development Agency misstatement identified by us as a result of our audit procedures
related to the understatement of principal and interest payments over the Glenwood note, corrected by management
and was material in the amount of $66,126, to the financial statements taken as a whole or applicable opinion units.
Disagreements with Management
For purposes of this letter, professional standards define a disagreement with management as a matter, whether or
not resolved to our satisfaction, concerning a financial accounting, reporting, or auditing matter, which could be
significant to the City’s financial statements or the auditor’s report. No such disagreements arose during the course
of the audit.
Representations Requested from Management
We have requested certain written representations from management, which are included in the attached letter dated
December 27, 2019.
Management’s Consultations with Other Accountants
In some cases, management may decide to consult with other accountants about auditing and accounting matters.
Management informed us that, and to our knowledge, there were no consultations with other accountants regarding
auditing and accounting matters.
Other Significant Matters, Findings, or Issues
In the normal course of our professional association with the City, we generally discuss a variety of matters, including
the application of accounting principles and auditing standards, operating and regulatory conditions affecting the
entity, and operational plans and strategies that may affect the risks of material misstatement. None of the matters
discussed resulted in a condition to our retention as the City’s auditors.
We applied certain limited procedures to management’s discussion and analysis and required supplementary
information schedules for OPEB, CRP, and PERS, which are required supplementary information (RSI) that
supplements the basic financial statements. Our procedures consisted of inquiries of management regarding the
methods of preparing the information and comparing the information for consistency with management’s responses
to our inquiries, the basic financial statements, and other knowledge we obtained during our audit of the basic
financial statements. We did not audit the RSI and do not express an opinion or provide any assurance on the RSI.
We were engaged to report on the supplemental information, which accompanies the financial statements, but is not
RSI. With respect to this supplemental information, we made certain inquiries of management and evaluated the
Attachment 2, Page 3 of 11
form, content, and methods of preparing the information to determine that the information complies with accounting
principles generally accepted in the United States of America, the method of preparing it has not changed from the
prior period, and the information is appropriate and complete in relation to our audit of the financial statements. We
compared and reconciled the supplemental information to the underlying accounting records used to prepare the
financial statements or to the financial statements themselves.
We were not engaged to report on the introductory and statistical sections, which accompany the financial statements
but are not RSI. Such information has not been subjected to the auditing procedures applied in the audit of the basic
financial statements, and accordingly, we do not express an opinion or provide any assurance on it.
This report is intended solely for the information and use of the City Council and management of the City and is not
intended to be and should not be used by anyone other than these specified parties.
Very truly yours,
CERTIFIED PUBLIC ACCOUNTANTS
Attachment 2, Page 4 of 11
Client: City of Springfield
Engagement:Financial Statement Audit
Period Ending:6/30/2019
Account Description Debit Credit
661-139998 Accumulated Depreciation 21,455.00
667-07600-695008 Depreciation Expense 21,455.00
661-07600-695008 Depreciation Expense 21,455.00
667-139998 Accumulated Depreciation 21,455.00
Total 42,910.00 42,910.00
932-160002 To be Provided-Comp & Vac 50,526.28
932-260000 Accrued Comp & Vacation P 50,526.28
Total 50,526.28 50,526.28
Total Proposed Journal Entries 93,436.28 93,436.28
Total All Journal Entries 93,436.28 93,436.28
Proposed Journal Entries JE # 30
To reclass depreciation expense and accumulated depreciation recorded to fund 661
which should have been recorded to fund 667.
Proposed Journal Entries JE # 31
To increase accrued liability balance for miscalculation of sick payout related to
PERS fire employee members
Attachment 2, Page 5 of 11
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Attachment 2, Page 11 of 11