HomeMy WebLinkAbout2015 CAFRCityofSeward, Alaska
Comprehensive Annual Financial Report
For the Year Ended December 31, 2015
Prepared by City of Seward Finance Department
The report accompanying these financial statements was issued by
BDO USA, LLP, a Delaware limited liability partnership and the U.S. member of
BDO International Limited, a UK company limited by guarantee.
Comprehensive AnnualFinancial Report
ofthe
CityofSeward, Alaska
FortheFiscalYearEnded
December 31, 2015
Jean Bardarson
MAYOR
Jim Hunt
CITYMANAGER
Prepared bythe Finance Department
Kristin M. Erchinger, CGFM, MPA
FINANCE DIRECTOR
City of Seward, Alaska
Contents
Exhibit Page
INTRODUCTORY SECTION
Table ofContents I-V
Letter of Transmittal VI-XIV
Certificate ofAchievement forExcellence inFinancial Reporting XV
List of Principal Officials XVI
Seward Citizens ÏOrganizational Chart XVII
FINANCIAL SECTION
Independent Auditor's Report 1-4
Management’sDiscussion and Analysis 5-18
BasicFinancial Statements
Government-wide Financial Statements:
Statement of Net Position A-1 20
Statement of Activities A-2 21
Fund Financial Statements:
Governmental Funds:
Balance Sheet B-1 22
Reconciliation ofGovernmental Funds
Balance Sheet toStatement ofNet Position B-223
Statement ofRevenues, Expenditures andChanges in
Fund Balances B-3 24
Reconciliation oftheChanges inFund Balances of
Governmental Funds toStatement ofActivities B-425
Statement ofRevenues, Expenditures andChange inFund
Balance - Budget and Actual - General Fund B-526
Proprietary Funds:
Statement of Net Position C-127
Statement ofRevenues, Expenses andChanges
in Net Position C-2 28
Statement of Cash Flows C-329-30
Statement ofFiduciary Net Position D-131
Notes to Basic Financial Statements 32-64
Required Supplementary Information
Public Employees Retirement System:
Schedule ofthe City'sInformation ontheNet Pension Liability E-166
Schedule of City Contributions E-267
International Brotherhood ofElectrical Workers (IBEW) - E-368
Schedule of CityContributions
Notes toRequired Supplementary Information 69
I
City of Seward, Alaska
Contents
Exhibit Page
FINANCIAL SECTION, continued
Supplementary Information
Combining andIndividual Fund Financial Statements andSchedules:
Nonmajor Governmental Funds:
Combining Balance Sheet F-1 72
Combining Statement ofRevenues, Expenditures and
Change in Fund Balances F-2 73
Nonmajor Enterprise Funds:
Combining Statement of Net Position G-174
Combining Statement ofRevenues, Expenses and
Change in Net Position G-2 75
Combining Statement of Cash Flows G-3 76-77
Internal Service Funds:
Combining Statement of Net Position H-178
Combining Statement ofRevenues, Expenses and
Change in Net Position H-2 79
Combining Statement ofCash Flows H-380
General Fund:
Balance Sheet I-1 82-83
Schedule of Revenues, Expenditures and
Change inFund Balance - Budget and Actual I-284-90
Nonmajor Special Revenue Funds:
Combining Balance Sheet J-1 92
Combining Statement ofRevenues, Expenditures and
Change in Fund Balances J-2 93
Nonmajor Capital Project Funds:
Combining Balance Sheet K-1 96
Combining Statement ofRevenues, Expenditures and
Change in Fund Balances K-2 97
Enterprise Funds:
Electric:
Statement ofNet Position L-1 100-101
Statement of Revenues, Expenses andChange inNetPosition L-2102
Statement of Cash Flows L-3103-104
Schedule of Operating Expenses L-4105
Schedule ofComposition ofNet Position L-5106
Schedule of Electric Capital Projects L-6107
II
City of Seward, Alaska
Contents
Exhibit Page
FINANCIAL SECTION, continued
Supplementary Information, continued
Combining andIndividual Fund Financial Statements andSchedules, continued:
Enterprise Funds, continued:
Water:
Statement of Net Position L-7108
Statement of Revenues, Expenses andChange inNetPosition L-8109
Statement of Cash Flows L-9 110
Schedule of Composition ofNet Position L-10 111
Wastewater:
Statement of Net Position L-11 112
Statement ofRevenues, Expenses and Change inNetPosition L-12113
Statement of Cash Flows L-13 114
Schedule of Composition ofNet Position L-14 115
Harbor:
Statement of Net Position L-15 116-117
Statement ofRevenues, Expenses and Change inNetPosition L-16118
Statement of Cash Flows L-17 119-120
Schedule of Composition ofNet Position L-18 121
Schedule of Harbor Capital Projects L-19 122
Seward Marine Industrial Center:
Statement of Net Position L-20 123
Statement ofRevenues, Expenses and Change inNetPosition L-21124
Statement of Cash Flows L-22 125
Schedule of Composition ofNet Position L-23 126
Parking:
Statement of Net Position L-24 127
Statement ofRevenues, Expenses and Change inNetPosition L-25128
Statement of Cash Flows L-26 129
Schedule of Composition ofNet Position L-27 130
Healthcare Facilities:
Statement of Net Position L-28 131
Statement ofRevenues, Expenses and Change inNetPosition L-29132
Statement of Cash Flows L-30 133
Internal Service Funds:
Motor Pool:
Statement of Net Position M-1136
Statement ofRevenues, Expenses and Change inNet Position M-2137
Statement ofCash Flows M-3138
Schedule of Composition of Net Position M-4139
III
City of Seward, Alaska
Contents
Exhibit Page
FINANCIAL SECTION, continued
Supplementary Information, continued
Combining andIndividual Fund Financial Statements andSchedules, continued:
Internal Service Funds, continued:
Compensated Annual Leave:
Statement of Net Position M-5140
Statement ofRevenues, Expenses and Change inNet Position M-6141
Statement ofCash Flows M-7142
TeenCouncil Agency Fund
Statement ofChanges inAssets and Liabilities N-1143
Capital Assets:
Schedule ofGovernmental Capital Assets O-1144
Schedule ofChanges inGovernmental Capital Assets O-2145
Schedule ofGovernmental Capital Assets byFunction and Activity O-3146
Schedule ofChanges inGovernmental Capital Assets byFunction
and Activity O-4 147
Schedule ofExpendituresof Federal Awards P-1148-149
Schedule of State Financial Assistance P-2150
Notes toSchedule ofExpenditures ofFederal Awards
and Schedule ofState Financial Assistance 151-152
IV
City of Seward, Alaska
Contents
Exhibit Page
STATISTICAL SECTION (Unaudited)
Net Position by Component 1 154
Changes in Net Position 2 155-156
Fund Balances of Governmental Funds 3 157
Changes in Fund Balances ofGovernmental Funds 4158
General Fund Revenues by Source 5159
General Fund Tax Revenues by Source 6160
Property Tax Rates 7 161
Property Tax Levies and Collections 8162
Assessed and Estimated Actual Value ofTaxable Property 9163
Principal Property Taxpayers 10 164
Principal Taxable Sales by Line ofBusiness 11 165
Ratios of Outstanding Debt by Type 12166
Ratio ofGeneral Obligation Bonded Debt toAssessed Value
and General Obligation Bonded Debt per Capita 13 167
Computation ofDirect and Overlapping Bonded Debt 14168
Legal Debt Margin 15 169
Revenue Bond Coverage ÏElectric Enterprise Fund 16170
Revenue Bond Coverage ÏHarbor Enterprise Fund 17 171
Demographic and Economic Statistics 18 172
Principal Employers 19 173
Full-Time Equivalent Employees by Fund 20174
Operating Indicators by Function 21 175
Capital Asset Statistics By Function 22 176
Property Value, Construction, and Bank Deposits 23 177
Miscellaneous Statistics 24 178
SINGLE AUDIT SECTION
Single AuditReports
Independent AuditorÔs Report onInternal Control OverFinancial
Reporting andonCompliance andOther Matters Based onan
Audit ofFinancial Statements Performed inAccordance with
Government Auditing Standards 179-180
Independent AuditorÔs Report onCompliance forEach Major
Federal Program andReportonInternal Control Over Compliance
Required by the Uniform Guidance 181-182
Independent AuditorÔs Report onCompliance forEach Major
StateProgram andReport onInternal Control Over Compliance
StateofAlaska AuditGuide andComplianceRequiredbythe
Supplement forStateSingle Audits 183-184
Schedule ofFindings and Questioned Costs 185-186
CityofSeward Single AuditResponses (Unaudited)
Summary Schedule of Prior Audit Findings 188
V
November 11, 2016
Honorable Members oftheSeward CityCouncil
Citizens ofthecityofSeward:
TheCityofSeward (City) Comprehensive Annual Financial Report (CAFR) fortheyear ended
December 31, 2015isherebysubmitted inaccordance with Alaska Statutes 29.35.120andtheSeward
CityCode. Thisreport satisfies the requirement thattheCityissue anannual report onitsfinancial
position andactivities, andthatthereportisaudited byanindependent firm ofcertified public
accountants.
Management isresponsible toensure theaccuracy, completeness, andfairness ofthepresentation of
thisinformation, including alldisclosures. To provide areasonable basisfor making these
representations, management hasestablished acomprehensive framework ofinternal controls which
isdesigned toprotect thegovernment’sassets fromloss, theft, ormisuse, andtoprovidesufficiently
reliable information uponwhich toprepare theCity’sfinancial statements inaccordance with
accounting principles generally accepted intheUnited States ofAmerica (GAAP). Because thecost
ofinternalcontrols should notoutweigh thebenefits, theCity’scomprehensive framework of
internal controls hasbeendesigned toprovidereasonable rather thanabsolute assurance thatthe
financial statements willbefreefrommaterial misstatement. Asmanagement weassert that, tothe
bestofourknowledge, thisfinancial report iscomplete andreliable inallmaterial respects.
TheCity’sfinancial statements havebeen audited byBDO USA, LLP, afirmofindependent certified
public accountants. Thegoaloftheindependent auditistoprovide reasonable assurance that the
financial statements oftheCityarefreeofmaterial misstatement. Theindependent auditinvolved
examining, onatestbasis, evidence supporting the amounts anddisclosures inthe financial
statements; assessing theaccounting principles usedandthesignificant estimates made by
management; andevaluating theoverall presentation ofthe financial statements. Theindependent
auditor concluded, basedontheaudit, thattherewasareasonable basisforrendering anunmodified
opinion thattheCity’sfinancial statements forthefiscalyearended December 31, 2015, arefairly
presented inconformity withGAAP. Theindependent auditor’sreport ispresented inthefinancial
section ofthisreport.
Generally accepted accounting principles require management toprovide anarrative introduction,
overview, andanalysis toaccompany thebasicfinancial statements, intheformofaManagement’s
Discussion andAnalysis (MD&A). Thisletteroftransmittal isdesigned tocomplement theMD&Aand
should bereadinconjunction withit. TheCity’sMD&Acanbe found immediately following the
report oftheindependent auditors.
Asarecipient offederal grantfunds, theCityisrequiredtoundergo anauditinaccordance withthe
provisions oftheU.S. Office ofManagement andBudget’s (OMB) Circular A-133, AuditsofStates,
LocalGovernments, and Non-ProfitOrganizations andassociated Compliance Supplement. A
schedule ofexpenditures offederalawards, theindependent auditor’sreport oninternal controls
andcompliance withapplicable lawsandregulations, andaschedule offindings andquestioned costs
ifany) areprepared aspart oftheauditinaccordance withOMBCircular A-133.
Asarecipient ofstate grantfunds, theCityisalsorequired toundergo anauditinaccordance with
the provisions ofAlaska StateRegulation 2AAC45.010andAuditGuideand Compliance Supplement
forStateSingle Audits. Astatefinancialassistance schedule, theindependent auditor’sreports on
internal controls andcompliance withapplicable lawsandregulations, andaschedule offindings and
questioned costs (ifany) areprepared aspartoftheauditinaccordance withtheStateofAlaska
Audit GuideandCompliance Supplement for StateSingle Audits.
Theindependent auditofthefinancial statements oftheCitywaspartofabroader, federally
mandated “SingleAudit” designed tomeetthespecial needs offederal andstategranting agencies.
Thestandards governing Single Auditengagements require theauditor toreport not onlyonthefair
presentation ofthefinancial statements, butalsooninternal controls andcompliance withcertain
legalrequirements, withspecial emphasis oninternal controlsandlegalrequirements involving the
administration offederal andstateawards. Thesefindings arepresented intheSingle AuditSection
ofthisreport.
Profile ofthe CityofSeward
TheCitywasincorporated onJune1, 1912, andbecame afirstclassCityunderAlaska Statute'shome
ruleprovisions (AS29.04.010) uponadoption oftheCityCharterbyareferendum vote onJanuary 5,
1960. The community islocated ontheeastern sideoftheKenaiPeninsula inSouthcentral Alaska,
125highway miles southofAnchorage. Year-roundaccess isavailable byroad, rail, water andtwo
small-aircraftrunways. TheCityhasanarea of22square milesandapopulation of2,740. Theform
ofgovernment established bytheCharteristheCouncil-Manager plan. TheCouncil exercises
legislative powerand determines allmatters ofpolicyfor theCity. TheCouncil iscomposed ofa
Mayor andsixcouncilmembers whoareelected at-large onanon-partisan basis. Councilmembers
andthe Mayor eachserve atermoftwoyears.
TheCityManager istheadministrative headoftheCitygovernment, isappointed bytheCouncil, and
isresponsible totheCouncil fortheproper handling ofallCity affairs. TheCity Clerk isalso
appointed bytheCouncil. TheClerk’sprimary responsibilities involve thesafekeeping ofpublic
records andtheadministration ofCityelections. TheCityAttorney isappointed bytheCouncil. All
otherofficers andemployees oftheCityareappointed bytheCityManager. Appointments tothe
following positionsaremade bytheCityManager withapproval oftheCouncil: Manager ofElectric
Utility; ChiefofPolice; FinanceDirector; andFireChief.
TheCity isempowered tolevyaproperty tax onbothrealandpersonal property locatedwithits
boundaries. Theproperty taxisanadvalorem tax. FundingfortheGeneral Fund, byorder of
significance, isprovided bysalestax, payments inlieuoftaxassessed toenterprise funds,
intergovernmental revenues, property tax, recreation andcamping fees, hotel/motel tax, landrent
andleases, andotherrevenues. TheCityprovides thefollowing services toitscitizens: police, fire,
public works, motor vehicletesting andlicensing, jail, animal control, building inspection,
community development, libraryandmuseum, parksandrecreation, electric, water, wastewater,
portandharbor, library, healthcare (primary careclinic, hospital, emergency room, long-termcare
facility), roadmaintenance, parking, andgeneral administrative services.
Budgetary Control
TheCity’sbudget serves asthefoundation for financial planning andcontrol. TheCityCouncil
adopts abiennial budget whichrepresents atwo-year period oftime. Adjustments tothebudget are
madethroughout theyear, asauthorized bytheCity Council. Inthesecond yearofthebiennial
budget, aninterimreview isconducted andmodifications mayberecommended totheCity Council.
Alldepartments submitbudget requests totheCityManager onorbefore September 1everyodd-
numbered year. TheCityManager utilizes theserequests toformulate aproposed budget and
submits theproposed budget totheCityCouncil ataregular meetinginOctober. TheCouncil holds
public hearings onthe proposed budget and generally adopts thebudget inNovember. TheCity
Manager isauthorized tomaketransfers between departments andlineitems within aFundfor
amounts upto $50,000. Council actionisrequired fortransfers between funds, forallsingle-item
purchases exceeding $50,000 (andallpurchases ofnewmotor vehiclesregardless ofcost), andforall
newappropriations. Budget-to-actual comparisons areprovided inthisreport fortheGeneralFund.
Factors Affecting Financial Condition Economy
Thenatural beauty ofSeward, itsyear-around deep-waterport, access byroadsystem andrail, and
itsrelatively mildclimate combine tomakeSeward attractive tomarine andtourism-related
businesses, andadestination ofchoicefortensofthousands ofvisitors. ThecostoflivinginSeward
isalsorelatively low forAlaska, andtaxes arelowandstable. Thecostofutilities isrelatively high
inSeward asinmostofAlaska, buttherecent dropinoilprices hasbrought relieftoresidents and
businesses struggling withhigh winter energy costs. Seward continues toseekrenewable energy
opportunities following theAlaska Sealife Center’ssuccessful project converting abundant seawater
for heating, andrecent temperature studies onboreholes alongthewaterfront whichdemonstrate
thefeasibility ofutilizing geothermal technology toheatCity-owned buildings inthedowntown
corridor.
Seward hasafairlydiversified economy relative tomany other placesinthestate, although it
remains fairlydependent onthe visitor industry forjobsandtaxrevenues. Thecommunity’sstrong
tourism, commercial andrecreational fishing, boat toursandamazing outdoor recreational
opportunities, bringoutside money intoSeward’seconomy, resulting instrong visitor-related sales.
Retail tradeinSeward represents 37.7% ofalltaxable sales, followed byguided watersales (19.1%),
restaurant andbar (12%), hotels andbedsandbreakfast (11.4%), public administration (6.6%),
wholesale trade (4.1%), andothers (7.1%). TheBorough unemployment rateisat7.8%, which is
lowerthanten-yearaverage rateof8.6%, buthigher thanthestatewide average of6.8%, whichisto
beexpected, givenSeward’slargely seasonaltourism andfishing economy. Borough-wide, percapita
personal income hasrisen nearly 47% inthe lasttenyears, from $34,536in2006to $50,760in2015,
whileduring thatsame timeperiod, Seward’spopulation rose5.1% from2,606in2006 to2,740in
2015. TheCityhasa4% salestaxwhichisapplied onlytothefirst $500ofeachseparate sale. One-
quarter ofthesalestax, equaltoa1% tax, issetasideforhealthcare purposes, serving capital and
operating needsofthehospital, long-termcarefacility, andfederally qualified health center (clinic).
Taxable salesactivity inSeward hasincreased 39% overthepasttenyears, averaging 3.9% annual
growth, reaching $124,818,252intaxable salesin2015. Sincesales taxrepresents thesinglelargest
revenuesource fortheCity’sGeneralFund (41%), thegrowth intaxable salesisanimportant
measure oftheabilityoftheCitytopayforgeneral government services.
There isgrowing interest inexpansion ofmarine transportation, shiprepair, commercial fishing
moorage, land development and relatedbusiness activity, andtheCity ismid-waythrough a $20
Million project toexpand theSeward Marine Industrial Center toenclose the basintoaccommodate
largermarine vessels. Thisproject isgenerating significant interest fromcommercial fishing fleets,
transportation companies, marine scientists, andotherlarge marine vessel operators withinterest in
expanded commercial harbor facilities. The AlaskaRailroad hasunveiled future plans toexpand dock
facilities inSeward, demonstrating apositive andgrowing economic climate fortransportation and
freight handling. However, cutstostateandfederal budgets mayimpact thedegree andpace at
which expansion occurs, withspending levels having adirect impact onthelocalconstruction and
trades industry. Overall, Seward saw30commercial construction building permits issuedatavalue
of $16.8million, and11residential construction building permits issued atavalueof $760,000in
2015.
Seward’sdowntown corridor hasseenrecent revitalization fromnewbusiness activity (two
restaurants, onehealth foodstore, afitness center, andasporting goods storeopenedinthepast
threeyears), reflecting optimism inthelocal business climate. Increased economic activityhas
encouraged newbusiness activity andgenerated increased tax revenues, withsales taxrevenues
increasing 30.5% from2010to2015 ($3.7million in2010to $4.9million in2015), property tax
revenues increasing 5.1% ($954,687in2010to $1,003,665in2015), hotel/motel taxrevenues
increasing 39.7% ($328,396in2010to $458,605in2015), andcampground revenues increasing 34.7%
479,343in2010to $645,617in2015). Whilethebusiness outlookappears positive, localbusinesses
aresensitive tohighcostsofutilitiesandheatingfuel, withthosecostsdetermining factors in
whether businesses closeinthewinter toavoidhigherwinter operating costs. Toaddress that
challenge, theCityimplemented seasonal electric ratesforresidential andsmallbusiness customers,
toreduce ratesinthe winter months andincrease ratesinthesummer. Seward’sstrong economic
activity continues torely, inlargepart, onvisitornumbers, butexpanded fisheries processing,
marine transportation, marine repair, scientific research and related industries inject adesired
degree ofdiversity inSeward’seconomic base.
Incomparison withothercommunities intheKenaiPeninsula Borough, Seward’sgrowth outpaced in
2011, 2012and 2013, slowed in2014, andoutperformed allbutSeldovia in2015. In2015, Seward’s
taxable salesrose (7.9%), asdidSeldovia (9.9%), Homer (0.2%) and Kenai (0.4%), whilethe Borough’s
taxable salesfell (-1.2%) followed bySoldotna at (-5.8%). The bulkofSeward’ssalestax (49%) is
generated during theperiod June, July andAugust, withtheinflux ofsummer visitors. In2014,
Seward’staxable sales growthwasthesecond-lowestintheborough at0.38%, outpacing Seldovia’s
negative 4.06% growth, butlowerthanSoldotna (1.5%), theBorough (1.9%), Homer (2.9%) andKenai
5.9%). In2013, Seward’staxablesalesgrowth wasthehighest intheborough at6.35%, followed by
Homer (3.55%) andSoldotna (2.15%). In2012, Seward’staxable salesgrowth wasthehighestat
4.47%, followed bySoldotna (3.38%) andKenai (2.19%). In2011, Seward’staxable salesgrewby
6.84% followed byHomer (5.57%) andKenai (5.05%).
TheCity’stopten property taxpayers havebecome morediverse overthepastfewyears, butstill
leantoward anover-dependence ontourism-related businesses andthevisitor industry. Thetop-ten
taxpayers represent various industries includingtourism, seafood processing, grocery, hotel/motel,
communications, petroleum products, and marine, andaccount forapproximately 22.9% ofall
taxable property inthe community. With thebulkoftheseentities beingvisitor-related, theCityis
vulnerable tochanges that affect thetourism industry, since salestaxandproperty taxaretwoof
theCity’stoprevenue sources, andcombined, accountfor49% ofallGeneral Fundrevenue.
StateStatutes wererecently amended toeliminate thereporting ofemployment figures for
individual employers. Assuch, theCitydoesnothaveprecise dataregarding thesizeofitslargest
employers. However, employment byindustry figures showthat 983resident workers in2014iswere
employed in trade/transportation andutilities (232), leisure andhospitality (154), education and
healthservices (121), localgovernment (109), state government (107), professional andbusiness
services (90), manufacturing (50), construction (35) andothers (85). Sewardmaintains asignificant
government presence (22% government employees), withmorethanhalfofthetoptenemployers
beinggovernment ornon-profitentities, including the state-owned prisonand vocational technical
center, theCity, theBoroughschool district, andthreenon-profitorganizations. Providence Seward
Medical andCare Center (thehospital andlong-term-care facility), Seward Community Health Center
clinic, andtheAlaska Sealife CenterareCity-ownedfacilities runontheCity’sbehalf bynon-profit
organizations, andtheyround outthelistoftopemployers. Thelargest privatesector employers
include Safeway, CIRI Alaska tourism, theBreeze Inn, andRay’sWaterfront.
Long-termFinancial planning
TheCity ofSewardprepares abiennial (two-year) budget attheendofevery odd year, forthe
upcoming two years. Intheoff-budgetyear, moreattention isgiventolonger-termfinancial
planning initiatives suchasutility ratereviews, capital infrastructure, andreviews ofbudget policies.
Capital Improvement Planswererecentlyupdated formajor infrastructure innearly everyenterprise
fundbasedonafive-yearreplacement plan, andidentifying criticalrisk (likelytofail inthe nextfive
years), highrisk (likelytofailwithin thenext5-10years), andmoderate risk (continuously increasing
costtooperateand maintain) infrastructure needs. Toaddressthereplacement ofinfrastructure,
enterprise funds haveautomatic tariffincreases mirroring thefive-yearaverage riseintheconsumer
priceindex, resulting inpositive improvement inenterprise fundphysical plantcondition and
stronger financial position.
Thefocus onlong-termfinancial planning hasresulted inanumber oftangible financial
improvements intheshort-term. Specifically, General Fundreserves haverisentowithin thepolicy
bandofbetween three andsixmonths’ worth ofexpenditures andtransfers-out. Reserve levelshave
reached theirhighest levelsinmorethanadecade (representing 4.2months’ worth ofexpenditures
andtransfers-out); theCapitalAcquisition Fundhasreceived periodic contributions toward future
general government infrastructure needs; theWater Enterprise Fundhas beenrepaid $1.97Million
loaned tothelong-termcarefacility tofinancebondreserves, which enabled theFundtocomplete
construction onanew600,000gallonwater storage tankinNorthForest Acres; allState revenue
sharingfunds areusedforone-time, non-recurring capital needs; major capital infrastructure
improvements arebeingaddressed intheHarbor (including completion ofnewA,B,C, DandS-Floats
andfishcleaning station); ElectricFundhasseencompletion ofanew electric warehouse andbackup
generators, andupcoming major repairstothe transmission lineatSnowRiver; andWastewater Fund
hascompleted dredging Seward’smainsewerinfrastructure assets, theLowell Point andSMICsewage
lagoons; andmonies arebeingsetasidetocreate ahealthcare facilities expansion Fund. The City
Council approved aplanforuseofthe1% salestaxdedicated tohealthcare, withthepriority being
toensure repayment ofthelong-termcarefacility bonds, thencapital repairs andreplacement of
existing infrastructure, andfinally, creation ofanewfundtofacilitate expansion orrelocation ofthe
hospital and clinic.
Financial Condition
TheCityhasstruggled formanyyears tobringitsGeneralFundunassigned fundbalancetoalevel
thatmeets itsownpolicy bandofbetween threeandsix months’ reserves. TheCity’sunassigned
fundbalance rose in2015by $19,547to $4,718,517, representing 4.2months’ reserves. This isup
from3.8months’ attheendof2014. Thisisamajor accomplishment, giventhattheCityhasnot
hadamajorsource ofrevenues forgeneral government capital needsinmorethantwenty years.
The GeneralFundreserves arestill amongthehighest levelinmore thantwodecades. Theincrease
inreserves islargely dueto $2.0million inone-timeEXXON Valdez oilspillsettlement payments in
2009and2010, atransfer ofold hospital PERSliabilities ($1,312,335) outofthe General Fundin
2012, andconsistent effortbystafftoeliminate unnecessary spending. There remains however,
significant unmet needforcapital repairand replacement funding toaddresserosion issues,
replacement oftheCityShopandparksandrecreation warehouse, torepay a $1.2million Army
Corps ofEngineers loan forthebreakwater, tocovertheCity’sshareofmatching fundsforasolution
tomajorflooding attheLowellCanyon tunnel outflow, tomatch grants, andtoaddress building and
infrastructure deferred maintenance. TheCity’sreserve levels maybecalled ontomitigate
potential health system financial shortfalls, Alaska Sealife Center funding uncertainty, enterprise
fundcritical needs, unforeseen emergencies andnaturaldisasters, andothersimilar risks. Anyof
theseriskscanhaveasignificant adverse impact ontheCity’sfinancial condition, enhancing the
need forahealthy levelofunassigned reserves.
Inrecent years, municipalities inAlaska havereceived fromthe StateofAlaska, financial assistance
inthe formofrevenue sharing andpension contribution raterelief. Thisfunding hasmitigated the
needtoreduce services orincrease localproperty taxes andhas enabled theCitytorebuild its
General Fundreserves. TheStateofAlaska isexperiencing asignificant budgetary shortfall inexcess
of $3Billion, threatening revenue sharingandotherStatefunding. Thestrength ofSeward’sretail
saleshasenabled theCitytoabsorb mostStatefunding reductions inyearswhenrevenue sharing
funding levels werereduced, and theCitycurrently programs those funds entirely forcapital
spending, soanylossoffuture revenue sharingwillnotimpact operating budgets. However, theCity
sawareduction instatefunding for jails, dispatching, andspace leaseofmorethan $400,000 in
2015. These revenue reductions andothers required asignificant cutofmorethan13.5% ofthe
General Fundbudget for2016. Whilethe Cityhasreduceditsdependence ongrantfunds for
replacement ofinfrastructure byincreasing enterprise fundrates, andhasmadesubstantial budget
cutstoabsorb lossesinfundingtotheGeneral Fund, the fullimpact oftheState’sbudgetchallenges
arelikelytohavecontinued impacts totheCity andtothecommunity, into thefuture.
TheCity’senterprise fundscontinue torefine theassessment ofcapital infrastructure condition and
toimplement themostcritical andhigh-riskrepair andreplacement projects asfunding allows. This
hasbeenaccomplished through incremental rateincreases overthepastfewyears, aswellas
successful grant-writing efforts. TheWater andWastewater Fundsstillhaveinsufficient resources to
meetcapital needs, although thebulk oftheirmajor capital infrastructure needs havebeen
addressed overthepast twoyears. Withreductions instate andfederal grant opportunities, itwill
bemoredifficultforenterprise fundstomitigate riskstotheirfinancial condition, socontinued
diligence andfocusonfinancial condition willbeapriority.
Major Projects
The Citycompleted anumber ofmajor projects thisyearincluding 1) replacement ofthenortheast
harbor fishcleaning station; 2) replacement offloatsintheHarbor; 3) replacement ofpolice radios;
4) ADAsidewalk improvements; and5) repairsandsludge removal inboththeLowell PointandSMIC
sewerlagoons. Thereareanumber ofmajor capital projects intheworks, including: 1) major road
improvements; 2) $20million toexpand theSeward MarineIndustrial Centerbreakwater; 3) upgrades
tothetransmission lineatSnowRiver; and 4) beacherosion repair. Future capital initiatives which
require funding andattention include refurbishment ofexisting waterstorage tanks, replacement of
theparkswarehouse, transmission line upgrades toSMIC; installation ofadditional utility sitesinthe
campgrounds, construction ofanewwaterfront shower house andrestroom, andanumber ofother
capital initiatives.
Cash Management Policies andPractices
Theinvestment andcollateralization ofCityfundsisgoverned bySection5.15oftheSewardCity
Code. The ordinance clearly identifies safety astheprimary concern intheselection and
management oftheCity’sinvestments. TheSewardCity Codeauthorizes investment inobligations of
theU.S. Treasury, itsagencies andinstrumentalities, repurchase agreements, fullycollateralized
certificates ofdeposit, highrated commercial paper, bankers’ acceptances, andtheAlaskaMunicipal
League Investment Pool. TheCitycombines allcashintoaCentral Treasury, facilitating the
investment ofcombined funds tomaximize investment earnings. Earnings ontheseinvestments are
allocated monthly toparticipating fundsbased onending cashbalances. The CityCodeplaces
limitations onmaturity ofinvestments andinvestment guidelines arecontained inaninvestment
policyestablished bythefinance director andapproved bythecitymanager.
RiskManagement
The Cityisamember oftheAlaska Municipal LeagueJointInsurance Association (JIA), agovernment
insurance poolestablished bytheAlaska Municipal League. The JIAprovides theCity’sinsurance
coverage forproperty, general liability, publicofficials andemployees’ liability, lawenforcement
professional liability, andworkers' compensation. TheCityalsomaintains special marine insurance
coverage andboiler andmachinery insurance coverage withotherinsurance companies. This
specialized insurance isplaced through JIA. TheJIA provideslosscontrol services andconducts
periodic inspections toensure safeoperations. TheCitymaintains asafety committee charged with
reviewing andrecommending safety policies andprocedures foralldepartments. TheCityCouncil
designates aportion ofthe General Fundreservestomeetpotential insurance-related losses, andto
support higher deductibles tominimize insurance premiums.
Pension andOther Post-employment Benefits
TheCityprovides pension benefits for alleligible employees through theStateofAlaskaPublic
Employees Retirement System (PERS). Thissystem consists offourdefined benefit (DB) Tiersandone
defined contribution (DC) Tier. TheCityhasnoobligations inconnection withemployee benefits
offered through theseplansbeyond itsannual required payments totheplans. TheCityhas always
paiditsannual required contribution ratesontime. TheCityanticipates near-termannual
contribution ratestobecapped at22% ofcovered payroll forboththeDBand DCPlans, based on
Statestatutes requiring theStateofAlaska tocover costsinexcess of22%. However, recent
proposed legislation aimsateliminating theState’scontributions inexcess of22%. Atthesametime,
theFY2015 StateLegislature enactedHB385 andSB119, changing theamortization methodology of
PERStoalevelpercent ofpay, andextending theamortization periodfor theunfunded pension and
health liabilities, bynineyears. These changes result inreducing annual payments bypushing
required employer contributions intothefuture. This substantially increases overall pension coststo
employers, asinvestment earnings arelostasameans toreduce future required employer
contributions. Thepractical resultofthislegislation isthatlowerannual employer contributions are
required (butoveralonger period), which significantly reduces theState’spayment ofcostson-
behalf oflocalgovernment employers. Forexample, theState’son-behalf contribution ratedropped
from42.41% fortheState’sfiscalyear ended6/30/15, to5.19% forperiod ending 6/30/16. TheState
ofAlaska paidatotalof $1,357,781towardthe CityofSeward’sPERSliabilityin2015due, inpart, to
aone-time $1Billion contribution bytheState, toreduce thePERSunfunded pension liability. New
thisyear, governmental accounting standards require that entities report within theirfinancial
statements, theirpro-ratashareofthenet pension liability ofthePERSsystem. Thetotalnet
pension liability attributed totheCityofSeward is $11.4million, with $2.4million considered tobe
theState’sproportionate shareoftheCity’sliability based onpresentlegislation. Thisnetpension
liability reflects onlytheliabilities associated withpensions, butdoesnotinclude liabilities
associated withretiree healthcare. Inthefuture, theCity willberequired toreport additional
liabilities associated withhealthcare liabilities ofPERS.
Financial Reporting Award
TheGovernment Finance Officers Association oftheUnitedStates andCanada (GFOA) awarded a
Certificate ofAchievement forExcellence inFinancial Reporting totheCityofSewardforits
comprehensive annual financial report (CAFR) fortheyearended December 31, 2014. Thisisthe
21stconsecutive yearthattheCityofSeward hasreceived thisprestigious award. Inordertobe
awarded aCertificate ofAchievement, agovernment mustpublish aneasilyreadable andefficiently
organized comprehensive annual financial report. Thisreport mustsatisfy both generally accepted
accounting principles andapplicable legalrequirements. ACertificate ofAchievement isvalidfora
periodofoneyearonly. Webelieve thatourcurrent comprehensive annual financial report
continues tomeetthe Certificate ofAchievement Program’srequirements andwearesubmitting it
totheGFOAtodetermine itseligibility for another certificate.
Acknowledgments
Wewould liketotakethisopportunity tothankthemembers oftheSeward CityCouncil fortheir
proactive efforts toprotect andenhance thephysical andfinancial assets ofthe City, forpromoting
Sewardasaworld-classdestination, forpromoting abusiness-friendly climateandencouraging
entrepreneurship, andforsetting Seward onapathofpositive andsustainable economic growth.
Thanks arealsoduetothededicated staffofthefinance department forpreparation ofthis
comprehensive annual financial report.
Respectfully submitted,
James Hunt, CityManager Kristin Erchinger, Finance Director
City of Seward, Alaska
GFOA Certificate
XV
City of Seward, Alaska
ListofPrincipalOfficials
Term Expires
JeanBardarson Mayor 2017
Marianna Keil Vice Mayor 2016
David Squires Council Member 2017
Ristine Casagranda Council Member 2016
Sue McClure Council Member 2017
Dale Butts Council Member 2016
Deborah Altermatt Council Member 2017
ADMINISTRATION
James Hunt City Manager
Ron Long Assistant City Manager
Kristin Erchinger Finance Director
John Foutz Manager ofElectric Utility
W.C. Casey Public Works Director
Norm Regis Harbormaster
Tom Clemons Chief of Police
Eddie Athey Fire Chief
Karin Sturdy Parks & Recreation Director
Valarie Kingsland Library Director
CITYCLERK
Johanna Kinney CityClerk
ATTORNEY
Will Earnhart City Attorney, Birch, Horton, Bittner
TheCity ofSeward isahome-rulecitywith acouncil-manager form of
government. Legislative powers oftheCity ofSeward arevested ina
council consisting of amayor andsixcouncil members. Themayor and
each council member areelected from thecityatlarge. Theterm ofoffice
istwoyears. Theappointed officers ofthecity include thecitymanager,
cityclerk, andthecityattorney. Thecitycouncil generally meets onthe
second andfourth Mondays ofeach month intheCity Council Chambers
located intheCityHallBuilding at410Adams Street inSeward, Alaska.
XVI
City of Seward, Alaska
Organizational Chart
XVII
Thispageintentionally leftblank.
XVIII
Tel:907-278-88783601 CStreet, Suite600
Fax: 907-278-5779 Anchorage, AK99503
www.bdo.com
Independent Auditor'sReport
Honorable Mayor andCityCouncil
CityofSeward, Alaska
Report ontheFinancial Statements
Wehave audited theaccompanying financial statements ofthegovernmental activities, the
business-typeactivities, each major fund, andtheaggregate remaining fund information of Cityof
Seward, Alaska, asofandfortheyearended December 31, 2015, andtherelated notes tothe
financial statements, which collectively comprise CityofSewardÔs basic financial statements as
listed inthetable ofcontents.
Management’sResponsibility for theFinancial Statements
Management isresponsible forthepreparation andfairpresentation ofthese financial statements
inaccordance withaccounting principles generally accepted intheUnited States ofAmerica; this
includes thedesign, implementation, andmaintenance ofinternal control relevant tothe
preparation andfairpresentation offinancial statements that arefreefrom material
misstatement, whether duetofraud orerror.
Auditor’sResponsibility
Ourresponsibility istoexpress opinions onthesefinancial statements based onouraudit. Wedid
notaudit the financial statements of theProvidence Seward Medical and Care Center (PSMCC)
whichrepresent 18% and100% respectively, oftheassets andrevenues oftheHealthcare Facilities
Enterprise Fund, and3% and35% respectively, of theassets, andrevenues ofthebusiness-type
activities. Those statements were audited byother auditors whose report hasbeenfurnished to
us, andouropinion, insofar asitrelates tothe amounts included forthe financial statements of
theProvidence Seward Medical andCare Center isbased solely onthe report oftheother auditors.
Weconducted ouraudit inaccordance with auditing standards generally accepted intheUnited
GovernmentStatesofAmericaandthestandardsapplicabletofinancialauditscontainedin
Auditing Standardsissued bytheComptroller General ofthe United States. Those standards
require thatweplan andperform theaudittoobtain reasonable assurance about whether the
financial statements arefreefrom material misstatement. Thefinancial statements ofthe PSMCC
Government Auditing Standardswerenotauditedinaccordancewith .
BDO USA, LLP, a Delaware limited liability partnership, is the U.S. member of BDO International Limited, a UK company limited by guarantee, and forms part of the
international BDO network of independent member firms.
BDO is the brand name for the BDO network and for each of the BDO Member Firms.
1
Anaudit involves performing procedures toobtain audit evidence about theamounts and
disclosures inthefinancial statements. The procedures selected depend ontheauditorÔs
judgment, including theassessment oftherisks ofmaterial misstatement ofthefinancial
statements, whether duetofraud orerror. Inmaking those riskassessments, the auditor
considers internal control relevant totheentityÔs preparation andfairpresentation ofthe
financial statements inorder todesign audit procedures that areappropriate inthe
circumstances, butnotforthepurpose ofexpressing anopinion ontheeffectiveness ofthe
entityÔs internal control. Accordingly, we express nosuch opinion. Anauditalsoincludes
evaluating theappropriateness ofaccounting policies used andthereasonableness ofsignificant
accounting estimates made bymanagement, aswellasevaluating theoverall presentation ofthe
financial statements.
We believe thattheaudit evidence wehave obtained issufficient andappropriate toprovide a
basis forouraudit opinions.
Opinions
Inouropinion, based onouraudit and thereport ofother auditors, thefinancial statements
referred to abovepresent fairly, inallmaterial respects, therespective financial position ofthe
governmental activities, thebusiness-type activities, each major fund, andtheaggregate
remaining fundinformation ofCityofSeward, Alaska asofDecember 31, 2015, andtherespective
changes infinancial position and, where applicable, cash flows thereof andtherespective
budgetary comparison fortheGeneral Fund fortheyear then ended in accordance with
accounting principles generally accepted intheUnited States ofAmerica.
Emphasis ofMatter – Change inAccounting Principle
Asdiscussed inNote 17tothefinancial statements, in2015 theCityadopted theprovisions of
Accounting andFinancialGovernmentalAccountingStandardsBoard (GASB) Statement 68,
Reporting forPensions. Ouropinion isnot modified withtherespect tothismatter.
Other Matters
Required Supplementary Information
Accounting principles generally accepted intheUnited States ofAmerica require thatthe
managementÔs discussion andanalysis onpages 5-18bepresented tosupplement thebasic
financial statements. Such information, although notapartofthebasic financial statements, is
required bytheGovernmental Accounting Standards Board whoconsiders ittobeanessential part
offinancial reporting forplacing thebasic financial statements inanappropriate operational,
economic, orhistorical context. We have applied certain limited procedures totherequired
supplementary information inaccordance withauditing standards generally accepted intheUnited
States ofAmerica, which consisted ofinquiries of management about themethods ofpreparing the
information andcomparing theinformation for consistency withmanagementÔs responses toour
inquiries, thebasic financial statements, andother knowledge weobtained during ouraudit ofthe
basicfinancial statements. Wedo notexpress anopinion orprovide anyassurance onthe
information because thelimited procedures do notprovide uswithsufficient evidence toexpress
anopinion orprovide anyassurance.
2
Supplementary andOther Information
Ouraudit fortheyear ended December 31, 2015 wasconducted forthepurpose offorming
opinions onthe financial statements thatcollectively comprise Cityof SewardÔs basic financial
statements. Theaccompanying Schedule ofExpenditures ofFederal Awards, theSchedule ofState
Financial Assistance, thecombining andindividual fund financial statements andschedules, and
theintroductory andstatistical sections fortheyear ended December 31, 2015 arepresented for
purposes ofadditional analysis andarenotarequired partofthebasicfinancial statements. The
Schedule ofExpenditures of Federal Awards andtheSchedule of State Financial Assistance are
Uniform AdministrativerequiredbyTitle2U.S. Code ofFederal Regulations Part 200,
Requirements, CostPrinciples, andAuditRequirements forFederal Awards State ofandthe
Alaska AuditGuideandCompliance Supplement forStateSingleAudits, respectively.
The accompanying Schedule ofExpenditures ofFederal Awards, theSchedule ofState Financial
Assistance andthecombining andindividual fund financial statements andschedules arethe
responsibility ofmanagement andwere derived fromand relate directly tothe underlying
accounting andotherrecords usedtoprepare thebasic financial statements. Such information has
been subjected to theauditing procedures applied intheaudit ofthebasic financial statements for
theyear ended December 31, 2015 andcertain additional procedures, including comparing and
reconciling such information directly totheunderlying accounting andother records used to
prepare thebasic financial statements ortothebasicfinancial statements themselves, andother
additional procedures inaccordance with auditing standards generally accepted intheUnited
StatesofAmerica. Inouropinion, theaccompanying supplementary information isfairly stated, in
allmaterial respects, inrelation tothebasic financial statements asawhole fortheyear ended
December 31, 2015.
Wealsopreviously audited, inaccordance withauditing standards generally accepted intheUnited
States ofAmerica, thebasic financial statements ofCityofSeward asofandfortheyear ended
December 31, 2014 (notpresented herein) andhave issued ourreport thereon dated September
21, 2014, which contained unmodified opinions ontherespective financial statements ofthe
governmental activities, thebusiness-type activities, each major fund, andtheaggregate
remaining fund information. Theindividual fundfinancial statements andschedules forthe year
ended December 31, 2014 arepresented forpurposes ofadditional analysis andarenotarequired
partofthebasic financial statements. Such information istheresponsibility ofmanagement and
wasderived from andrelates directly totheunderlying accounting andotherrecords used to
prepare the2014 financial statements. Theindividual fund financial statements andschedules
have been subjected totheauditing procedures applied intheaudit ofthe2014 basic financial
statements andcertain additional procedures, including comparing andreconciling such
information directly totheunderlying accounting andother records used toprepare those financial
statements ortothose financial statements themselves, andother additional procedures in
accordance with auditing standards generally accepted intheUnited States ofAmerica. In our
opinion, the supplementary information isfairlystated inallmaterial respects inrelation tothe
basic financial statements asawhole forthe yearended December 31, 2014.
Theintroductory andstatistical sections have notbeen subjected totheauditing procedures
applied intheaudit ofthebasic financial statements, andaccordingly, we donot express an
opinion orprovide anyassurance onthem.
3
Other Reporting Required byGovernment Auditing Standards
Government AuditingStandardsInaccordancewith , wehave alsoissued ourreport dated
November 11, 2016 onour consideration ofCity ofSewardÔs internal control over financial
reporting andonourtests ofitscompliance with certain provisions of laws, regulations,
contracts, andgrant agreements andothermatters. Thepurpose of thatreport istodescribe the
scope ofourtesting ofinternal control overfinancial reporting andcompliance andtheresults of
thattesting, andnottoprovide anopinion oninternal control over financial reporting oron
Governmentcompliance. That report isanintegral partofanaudit performed inaccordance with
Auditing Standardsinconsidering CityofSewardÔs internal control overfinancial reporting and
compliance.
Anchorage, Alaska
November 11, 2016
4
unassigned fund balance)
governmental activities
business-type activities)
Fund financial statements
fund
Governmental Fundsgovernmental
activities
governmental funds
governmental activities
combining statements
required
supplementary information
unassigned fund balance
nonspendable
restricted committed
assigned
unassigned
nonspendable)
restricted)
committed
assignedrestricted committed
unassigned
unassigned fund balance
Budgetary
Actual
BasicFinancialStatements - Overview
These financial statements provide asummary overview ofthefinancial position andresults of
operations ofallfunds oftheCity, aggregated at thegovernment-wideandthemajor fund level.
Thefollowing statements areincluded inthissection:
Statement ofNetPosition
Statement ofActivities
Governmental Funds - Balance Sheet
Reconciliation ofGovernmental Funds Balance Sheet toStatement ofNetPosition
Governmental Funds - Statement ofRevenues, Expenditures andChange inFund Balances
Reconciliation oftheChanges inFund Balances ofGovernmental Funds toStatement of
Activities
General Fund - Statement ofRevenues, Expenditures andChange inFund Balance -
Budget andActual
Proprietary Funds - Statement ofNetPosition
Proprietary Funds - Statement ofRevenues, Expenses andChange inNetPosition
Proprietary Funds - Statement ofCash Flows
Statement ofFiduciary NetPosition
NotestoBasic Financial Statements
19
Exhibit A-1
City of Seward, Alaska
Statement ofNet Position
GovernmentalBusiness-type
December 31, 2015ActivitiesActivitiesTotal
Assets
Cash and investments$ 13,116,91210,056,188$ 23,173,100$
Receivables, net of allowance for doubtful accounts:
Taxes -489,182 489,182
Accounts 3,977,635210,666 4,188,301
Grants, shared revenues, and loans626,450 8,281,308 8,907,758
Accrued interest 15,550106,974 122,524
Other 119,390709,669 829,059
Prepaid items 3,600601,273 604,873
Inventories 1,072,9178,711 1,081,628
Restricted cash and investments 8,529,850- 8,529,850
Other assets 789,589- 789,589
Internal balances (196,640)196,640 -
Capital assets not being depreciated 47,816,7616,012,428 53,829,189
Capital assets being depreciated, net of depreciation55,699,511 79,175,800 134,875,311
Total Assets 162,702,67274,717,692 237,420,364
Deferred Outflows of Resources
Pension related 520,2511,233,763 1,754,014
Unamortized deferred loss on refunding 216,637- 216,637
Total Deferred Outflows of Resources 736,8881,233,763 1,970,651
Total Assets and Deferred Outflows of Resources$ 163,439,56075,951,455$ 239,391,015$
Liabilities
Accounts payable$ 2,565,037423,666$ 2,988,703$
Payable to Providence Health and Services - Washington- 4,868,000 4,868,000
Due to contractual agencies 27,000- 27,000
Accrued payroll and related liabilities 809,378386,245 1,195,623
Accrued interest 410,70850,517 461,225
Other accrued liabilities -33,078 33,078
Customer deposits 459,19299,069 558,261
Unearned revenue 2,202,66030,760 2,233,420
Noncurrent liabilities:
Due within one year:
Annual leave 58,377116,215 174,592
Notes payable 190,168- 190,168
Bonds payable 1,465,00095,000 1,560,000
Due in more than one year:
Annual leave 122,096389,139 511,235
Notes payable 4,085,777- 4,085,777
Bonds payable, including bond premium3,426,546 32,745,046 36,171,592
Net pension liability 2,665,2666,320,627 8,985,893
Total Liabilities 52,673,70511,370,862 64,044,567
Deferred Inflows of Resources - pension related111,901 47,186 159,087
Net Position
Net investment in capital assets 91,782,80158,190,393 149,973,194
Restricted for capital projects, bond retirement, & commercial passenger vessel tax- 1,354,473 1,354,473
Unrestricted 17,581,3956,278,299 23,859,694
Total Net Position 110,718,66964,468,692 175,187,361
Total Liabilities, Deferred Inflows of Resources, and Net Position$ 163,439,56075,951,455$ 239,391,015$
See accompanying notes to basic financial statements.
20
Exhibit A-2
CityofSeward, Alaska
Statement of Activities
Year Ended December 31, 2015
Net (Expense) Revenue and
Program RevenuesChanges in Net Position
Fees,
Fines &OperatingCapitalBusiness-
Charges forGrants &Grants &Governmentaltype
Functions/ProgramExpenses ServicesContributionsContributionsActivitiesActivitiesTotal
Governmental Activities
General government3,517,517$ 294,499$ 74,086$ -$ (3,148,932)$ -$ (3,148,932)$
Public safety3,563,666 817,995 - 65,462 (2,680,209) - (2,680,209)
Public works1,791,967 22,278 37,019 - (1,732,670) - (1,732,670)
Parks and recreation1,463,364 778,350 - - (685,014) - (685,014)
Library785,299 33,762 19,358 - (732,179) - (732,179)
Clinic1,682,532 75,085 1,026,292 - (581,155) - (581,155)
Sea Life Center1,457,308 - - 556,250 (901,058) - (901,058)
Interest expense153,950 - - - (153,950) - (153,950)
Total Governmental
Activities 2,021,96914,415,603 1,156,755 621,712 (10,615,167) - (10,615,167)
Business-type Activities
Electric10,599,641 11,482,077 52,010 3,518,402 - 4,452,848 4,452,848
Water1,241,671 1,283,986 12,462 4,305,736 - 4,360,513 4,360,513
1,480,006 1,480,006Wastewater1,097,494 1,096,290 10,980 1,470,230 -
Harbor3,858,440 3,359,455 34,987 2,911,132 - 2,447,134 2,447,134
SMIC1,260,159 593,307 - 1,244,350 - 577,498 577,498
Healthcare Facilities19,589,784 18,330,000 3,000 109,300 - (1,147,484) (1,147,484)
Parking178,886 318,223 - - - 139,337 139,337
Total Business-type
Activities 36,463,33837,826,075 113,439 13,559,150 - 12,309,852 12,309,852
Total Primary
Government$ 38,485,30752,241,678$ 1,270,194$ 14,180,862$ (10,615,167) 12,309,852 1,694,685
General Revenues
Taxes:
Sales taxes4,883,996 - 4,883,996
Property taxes1,013,370 - 1,013,370
Other taxes458,605 - 458,605
Payment in lieu of taxes88,331 - 88,331
Grants and entitlements not
restricted to a specific purpose850,297 1,242,072 2,092,369
Insurance recovery- 522 522
Investment income125,636 278,688 404,324
Transfers (1,181,852)1,181,852 -
Total General Revenues and Transfers 339,4308,602,087 8,941,517
Change in Net Position 12,649,282(2,013,080) 10,636,202
Net Position, beginning, as restated (Note 17)66,481,772 98,069,387 164,551,159
Net Position, ending64,468,692$ 110,718,669$ 175,187,361$
See accompanying notes to basic financial statements.
21
Exhibit B-1
City of Seward, Alaska
Governmental Funds
Balance Sheet
Major FundTotal
NonmajorGovernmental
December 31, 2015GeneralFundsFunds
Assets
Cash and investments$ 2,433,9505,889,694$ 8,323,644$
Receivables, net of allowance for doubtful accounts:
Taxes -489,182 489,182
Accounts -210,666 210,666
Grants and shared revenues8,711 617,739 626,450
Accrued interest -63,022 63,022
Other 709,669- 709,669
Prepaid items 9,676591,597 601,273
Inventory -8,711 8,711
Due from other funds -1,406,131 1,406,131
Total Assets$ 3,771,0348,667,714$ 12,438,748$
Liabilities
Accounts payable$ 56,924366,742$ 423,666$
Accrued payroll and related liabilities347,694 38,551 386,245
Accrued liabilities -33,078 33,078
Deposits -99,069 99,069
Due to other funds 1,158,142- 1,158,142
Unearned revenue -30,760 30,760
Total Liabilities 1,253,617877,343 2,130,960
Deferred Inflows of Resources
Delinquent property taxes20,663 - 20,663
Total Liabilities and Deferred Inflows of Resources 1,253,617898,006 2,151,623
Fund Balances
Nonspendable:
Inventory -8,711 8,711
Prepaid items 9,676591,597 601,273
Committed:
Working capital -1,500,000 1,500,000
Insurance -126,418 126,418
Hospital line of credit -500,000 500,000
Assigned:
Parks and recreation 2,498- 2,498
Public works 4,259- 4,259
General government 5,641- 5,641
Clinic 102,538- 102,538
Capital projects 2,392,805- 2,392,805
Insurance -224,465 224,465
Other assignments -100,000 100,000
Unassigned -4,718,517 4,718,517
Total Fund Balances 2,517,4177,769,708 10,287,125
Total Liabilities, Deferred Inflows of Resources, and Fund Balances$ 3,771,0348,667,714$ 12,438,748$
See accompanying notes to basic financial statements.
22
Exhibit B-2
City of Seward, Alaska
Reconciliation of Governmental Funds Balance Sheet
to Statementof NetPosition
December31, 2015
Total fund balances for governmental funds10,287,125$
Total netposition reported forgovernmental activities inthe
Statement ofNetPosition isdifferent because:
Capital assets used ingovernmental activities are not
financial resources and therefore arenotreported
in the funds. These assets, net ofaccumulated Internal
depreciation consist of:GovernmentalService
Land5,509,589$ -$
Construction in progress502,839 -
Buildings70,253,752 -
Improvements other than buildings22,388,669 -
Machinery and equipment9,254,678 6,563,057
Accumulated depreciation(48,315,853) (4,444,792)
Total capital assets59,593,674$ 2,118,265$ 61,711,939
Other long-term assets arenotavailable topay forcurrent
period expenditures and therefore are deferred inthe funds.20,663
Aninternal service fund isused bytheCitytocharge thecost
ofvehicles and heavy equipment toindividual funds. The
netposition oftheinternal service fund attributable to
governmental activities is included inthegovernmental
column on theStatement of NetPosition.
Net position related togovernmental activities3,338,058$
Less amount reported with capital assets(2,118,265)
Plus amount reported with long-term liabilities505,354
1,725,147
Long-term liabilities, including bonds payable, therelated
accrued interest andaccrued leave are not due and
payable inthe current period and are therefore not Internal
reported asfund liabilities. These liabilities consist of:GovernmentalService
General obligation bonds payable (3,305,000)$ -$
Accrued interest on bonds(50,517) -
Accrued leave- (505,354)
Unamortized bond premium(216,546) -
Net pension liability (6,320,627) -
Total long-term liabilities(9,892,690)$ (505,354)$ (10,398,044)
Certain changes connected with thenet pension liability are
deferred rather than recognized immediately. These items are
amortized over time:
Deferred outflows ofresources related topensions1,233,763$
Deferred inflows of resources related topensions(111,901)
Total deferred pension items 1,121,862
Total Net Position ofGovernmental Activities$ 64,468,692
See accompanying notes tobasic financial statements.
23
ExhibitB-3
City of Seward, Alaska
Governmental Funds
Statement of Revenues, Expenditures and Changes in Fund Balances
Total
Major FundGovern-
Nonmajormental
Year Ended December 31, 2015GeneralFundsFunds
Revenues
Taxes6,438,604$ -$ 6,438,604$
Licenses and permits206,365 - 206,365
Intergovernmental2,280,061 1,121,273 3,401,334
Charges for services2,757,831 - 2,757,831
Fines and bails17,993 - 17,993
Investment income78,716 - 78,716
Other 82,585125,812 208,397
TotalRevenues 1,203,85811,905,382 13,109,240
Expenditures
Current:
General government3,043,539 236,433 3,279,972
Public safety3,366,320 - 3,366,320
Public works1,498,297 25,260 1,523,557
Parks and recreation1,365,408 8,985 1,374,393
Library553,272 - 553,272
Clinic 1,682,532- 1,682,532
Debtservice:
Principal payments90,000 - 90,000
Retirement benefits1,401,165 - 1,401,165
Interest and other costs155,150 - 155,150
Capitaloutlay:
General government- 98,430 98,430
Public works- 402,611 402,611
Public safety5,566 102,656 108,222
Parks and recreation- 38,595 38,595
TotalExpenditures 2,595,50211,478,717 14,074,219
Excessof RevenuesOver
Under) Expenditures (1,391,644)426,665 (964,979)
OtherFinancingSources (Uses)
Transfers in1,980,280 1,441,479 3,421,759
Transfers out(2,085,636) (301,283) (2,386,919)
NetOtherFinancingSources (Uses) 1,140,196(105,356) 1,034,840
NetChangeinFundBalances (251,448)321,309 69,861
FundBalances, beginning7,448,399 2,768,865 10,217,264
FundBalances, ending7,769,708$ 2,517,417$ 10,287,125$
Seeaccompanyingnotestobasicfinancialstatements.
24
Exhibit B-4
City of Seward, Alaska
Reconciliation oftheChange inFund Balances ofGovernmental Funds
toStatement ofActivities
YearEnded December 31, 2015
Net change in fund balances - total governmental funds69,861$
The change in net position reported for governmental activities in the
Statement of Activities is different because:
Governmental funds report capital outlays as expenditures. However
on the Statement of Activities, depreciation expense is recognized to
allocate the cost of these items over their estimated useful lives.
This is the amount by which depreciation of $2,487,774 exceeded
capital outlays of $1,204,108.(1,283,666)
Revenues in the Statement of Activities that do not provide current
financial resources are not reported as revenues in the funds. This
is the increase in other long-term assets.5,698
Issuance of long-term debt provides current financial resources to
governmental funds, while the repayment of the principal of the
long-term debt consumes financial resources in governmental funds.
In addition, interest on long-term debt is not recognized under the
modified accrual basis of accounting until due, rather than as it accrues.
This adjustment combines the net change in these balances:
Accrued interest payable1,200$
Amortization of bond premium10,827
Principal payments on long-term debt90,000
102,027
Certain changes connected with the net pension liability are deferred and
amortized over time. This is the overall change inthe net pension liability and
related deferred outflows of resources and deferred inflows of resources.(1,115,488)
An internal service fund is used by the City to charge the cost of
vehicles and heavy equipment to individual funds. A portion of the
net revenue of these activities is reported with governmental activities.208,488
Change inNet Position of Governmental Activities$(2,013,080)
See accompanying notes to basic financial statements.
25
Exhibit B-5
City of Seward, Alaska
General Fund
Statement ofRevenues, Expenditures
andChange inFund Balance - Budget andActual
OriginalFinal
Year Ended December 31, 2015BudgetBudgetActualVariance
Revenues
Taxes5,883,957$ 6,411,601$ 6,438,604$ 27,003$
Licenses and permits163,350 163,350 206,365 43,015
Intergovernmental1,636,610 2,203,532 2,280,061 76,529
Charges for services2,619,110 2,601,410 2,757,831 156,421
Fines and bails10,000 10,000 17,993 7,993
Investment income53,000 53,000 78,716 25,716
Other22,700 40,400 125,812 85,412
Total Revenues 11,483,29310,388,727 11,905,382 422,089
Expenditures
Current:
General government2,857,169 3,300,820 3,043,539 257,281
Public safety3,388,369 3,720,999 3,371,886 349,113
Public works1,587,077 1,710,765 1,498,297 212,468
Parks and recreation1,257,046 1,338,914 1,365,408 (26,494)
Library545,761 580,006 553,272 26,734
Debt service:
Principal payments200,784 200,784 90,000 110,784
Retirement benefits739,499 1,456,298 1,401,165 55,133
Interest and other costs155,150 155,150 155,150 -
Total Expenditures 12,463,73610,730,855 11,478,717 985,019
Excess of Revenues Over
Under) Expenditures (980,443)(342,128) 426,665 1,407,108
Other Financing Sources (Uses)
Transfers in1,972,148 1,972,148 1,980,280 8,132
Transfers out(1,630,020) (2,187,808) (2,085,636) 102,172
Net Other Financing Sources (Uses) (215,660)342,128 (105,356) 110,304
Net Change in Fund Balance$ (1,196,103)-$ 321,309 1,517,412$
Fund Balance, beginning7,448,399
Fund Balance, ending7,769,708$
See accompanying notes to basic financial statements.
26
Exhibit C-1
CityofSeward, Alaska
Proprietary Funds
Statement of Net Position
Enterprise Funds
Major Funds TotalInternal
HealthcareNonmajorEnterpriseService
December 31, 2015ElectricWaterHarborSMICFacilitiesFundsFundsFunds
Assets
Current Assets
Cash and investments4,507,017$ 1,034,762$ 313,275$ -$ 6,426,831$ 835,027$ 13,116,912$ 1,732,544$
Receivables:-
Accounts1,000,085 174,777 226,191 55,545 4,270,000 95,630 5,822,228 -
Accrued interest15,550 - - - - - 15,550 43,952
Interfund loans20,578 - - - - - 20,578 181,854
Grants and loans1,037,210 1,054,071 3,509,291 1,146,534 - 1,534,202 8,281,308 -
Other receivables9,640 750 - - 109,000 - 119,390 -
Less allowance for doubtful accounts(45,004) (7,851) (33,435) - (1,754,000) (4,303) (1,844,593) -
Prepaid expenses3,600 - - - - - 3,600 -
Inventory978,626 94,291 - - - - 1,072,917 -
Other assets- - - - 76,589 - 76,589 -
2,350,800 4,015,322 1,202,079 9,128,420 2,460,556 26,684,479 1,958,350TotalCurrentAssets7,527,302
Noncurrent Assets
Restricted cash and investments1,952,705 943,636 3,660,149 - 1,973,360 - 8,529,850 -
Other assets- - - - 713,000 - 713,000 -
Interfund loans, net of current portion275,617 - - - - - 275,617 1,536,090
Property, plant and equipment:
Total capital assets not being depreciated5,853,857 4,881,733 21,066,081 15,768,339 135,740 111,011 47,816,761 -
Total capital assets being depreciated57,700,908 8,803,849 34,007,913 42,577,981 36,714,295 15,804,274 195,609,220 6,563,057
Less accumulated depreciation(38,876,118) (4,923,659) (16,349,436) (29,422,321) (18,058,080) (8,803,806) (116,433,420) (4,444,792)
Total Noncurrent Assets 9,705,55926,906,969 42,384,707 28,923,999 21,478,315 7,111,479 136,511,028 3,654,355
Total Assets 12,056,35934,434,271 46,400,029 30,126,078 30,606,735 9,572,035 163,195,507 5,612,705
Deferred Outflows of Resources
Related to pensions245,004 58,707 164,817 - - 51,723 520,251 -
Unamortized deferred loss on refunding- - 216,637 - - - 216,637 -
Total Deferred Outflows of Resources 58,707245,004 381,454 - - 51,723 736,888 -
Total Assets and Deferred Outflows of Resources$ 12,115,06634,679,275$ 46,781,483$ 30,126,078$ 30,606,735$ 9,623,758$ 163,932,395$ 5,612,705$
Liabilities
Current Liabilities
Accounts payable736,850$ 15,639$ 434,613$ 1,123,402$ 250,000$ 4,533$ 2,565,037$ -$
Payable to Providence Health and Services - Washington- - - - 4,868,000 - 4,868,000
Due to contractual agencies- - - - 27,000 - 27,000 -
Accrued payroll and related liabilities21,362 5,997 13,460 1,093 763,000 4,466 809,378 -
Accrued interest21,991 19,334 32,842 - 336,541 - 410,708 -
Current portion:
Accrued annual leave24,323 8,847 18,784 - - 6,423 58,377 116,215
Bonds payable130,000 - 470,000 - 865,000 - 1,465,000 -
Notes payable- 131,182 - - - 58,986 190,168 -
202,432 - Interfund loans - - 27,698 98,008 76,726
Deposits254,239 - 42,753 12,200 150,000 - 459,192 -
Unearned revenue- - 554,560 63,100 1,585,000 - 2,202,660 -
Due to other funds- - - 185,768 - 62,221 247,989 -
Total Current Liabilities 180,9991,188,765 1,594,710 1,483,571 8,921,267 136,629 13,505,941 116,215
Noncurrent Liabilities, net of current portion
Accrued annual leave31,725 24,149 44,274 - - 21,948 122,096 389,139
Bonds payable, including unamortized premium5,140,054 - 4,915,433 - 22,689,559 - 32,745,046 -
Notes payable- 1,579,595 1,201,196 - - 1,304,986 4,085,777 -
Net pension liability1,255,168 300,758 844,363 - - 264,977 2,665,266 -
Interfund loans - - - 784,066 1,027,641 - 1,811,707 -
Total Noncurrent Liabilities 1,904,5026,426,947 7,005,266 784,066 23,717,200 1,591,911 41,429,892 389,139
8,599,976 2,267,637 32,638,467 1,728,540 54,935,833 505,354TotalLiabilities2,085,5017,615,712
Deferred Inflows of Resources - related to pensions22,222 5,324 14,949 - - 4,691 47,186 -
Net Position
Net investment in capital assets19,804,629 7,051,146 33,044,764 28,923,999 (2,789,244) 5,747,507 91,782,801 2,118,265
Restricted for commercial passenger vessel tax- - 1,354,473 - - - 1,354,473 -
Unrestricted (deficit)7,236,712 2,973,095 3,767,321 (1,065,558) 757,512 2,143,020 15,812,102 2,989,086
Total Net Position 10,024,24127,041,341 38,166,558 27,858,441 (2,031,732) 7,890,527 108,949,376 5,107,351
Total Liabilities, Deferred Inflows of Resources and Net Position$ 12,115,06634,679,275$ 46,781,483$ 30,126,078$ 30,606,735$ 9,623,758$ 5,612,705$
Adjustment to reflect the consolidation of internal service fund activities related to enterprise funds1,769,293
Net Position of Business-type Activities$110,718,669
See accompanying notes to basic financial statements.
27
Exhibit C-2
City of Seward, Alaska
Proprietary Funds
Statement ofRevenues, Expenses and Change inNet Position
Enterprise Funds
Major Funds TotalInternal
HealthcareNonmajorEnterpriseService
Year Ended December 31, 2015ElectricWaterHarborSMICFacilitiesFundsFundsFunds
Operating Revenues
Charges for services11,270,980$ 1,283,986$ 3,359,455$ 593,307$ 18,330,000$ 1,414,274$ 36,252,002$ -$
Vehicle rental and interfund
charges- - - - - - - 944,089
Total Operating Revenues 1,283,98611,270,980 3,359,455 593,307 18,330,000 1,414,274 36,252,002 944,089
Operating Expenses
Salaries and employee benefits1,538,016 439,097 1,178,441 116,769 12,001,000 469,023 15,742,346 473,650
Services and supplies5,931,223 315,941 733,123 231,952 3,597,000 363,543 11,172,782 3,900
Administration869,585 261,466 377,916 177,808 880,639 185,049 2,752,463 -
Depreciation1,724,295 199,645 1,367,544 733,630 1,946,744 259,945 6,231,803 434,783
Total Operating Expenses 1,216,14910,063,119 3,657,024 1,260,159 18,425,383 1,277,560 35,899,394 912,333
Earnings (Loss) from Operations 67,8371,207,861 (297,569) (666,852) (95,383) 136,714 352,608 31,756
Nonoperating Revenues (Expenses)
Intergovernmental - PERS on-behalf52,010 12,462 34,987 - - 10,980 110,439 -
Investment income (loss)192,151 47,774 36,758 (1,582) 13 3,574 278,688 46,920
Salary credits - work orders100,577 - - - - - 100,577 -
Supply credits - work orders110,520 - - - - - 110,520 -
Insurance recovery- - - 522 - - 522 -
Interest expense(271,699) (25,826) (205,318) - (1,164,401) - (1,667,244) -
Commercial passenger vessel tax- - 1,242,072 - - - 1,242,072 -
Nonoperating grant revenue- - - - 3,000 - 3,000 -
Other revenue (expenses)(276,637) - - - - 239 (276,398) -
Net Nonoperating Revenues (Expenses) 34,410(93,078) 1,108,499 (1,060) (1,161,388) 14,793 (97,824) 46,920
Earnings (Loss) Before Contributions
and Transfers 102,2471,114,783 810,930 (667,912) (1,256,771) 151,507 254,784 78,676
Capital contributions3,518,402 4,305,736 2,911,132 1,244,350 109,300 1,470,230 13,559,150 -
Transfers in110,784 - 243,861 27,520 1,129,829 30,826 1,542,820 147,012
Transfers out (1,238,455) (142,954) (410,352) (312,858) (500,000) (120,053) (2,724,672) -
Change in Net Position 4,265,0293,505,514 3,555,571 291,100 (517,642) 1,532,510 12,632,082 225,688
Net Position, beginning, as restated (Note 17)23,535,827 5,759,212 34,610,987 27,567,341 (1,514,090) 6,358,017 4,881,663
Net Position, ending27,041,341$ 10,024,241$ 38,166,558$ 27,858,441$ (2,031,732)$ 7,890,527$ 5,107,351$
Adjustment to reflect the consolidation of internal
service fund activities related to enterprise funds 17,200
Change in Net Position of Business-type Activities$12,649,282
See accompanying notes to basic financial statements.
28
Exhibit C-3
City of Seward, Alaska
ProprietaryFunds
StatementofCashFlows
Enterprise Funds
Major Funds TotalInternal
HealthcareNonmajorEnterpriseService
Year Ended December 31, 2015ElectricWaterHarborSMICFacilitiesFundsFundsFunds
Cash Flows from (for) Operating Activities
Receipts from customers and users11,282,909$ 1,266,130$ 3,291,919$ 602,346$ 21,785,795$ 1,407,442$ 39,636,541$ -$
Payments to suppliers(6,075,150) (303,471) (388,919) (236,492) (4,756,589) (380,051) (12,140,672) (3,900)
Payments to employees(1,202,996) (364,799) (1,040,451) (115,947) (12,228,000) (414,188) (15,366,381) (443,366)
Payments for interfund services used(869,585) (261,466) (377,916) (177,278) (880,639) (172,049) (2,738,933) -
Receipts from vehicle rentals and interfund charges- - - - - - - 944,089
Net cash flows from operating activities3,135,178 336,394 1,484,633 72,629 3,920,567 441,154 9,390,555 496,823
Cash Flows from (for) Noncapital Financing Activities
Transfers in110,784 - 243,861 27,520 1,129,829 30,826 1,542,820 147,012
Transfers out(1,238,455) (142,954) (410,352) (312,858) (500,000) (120,053) (2,724,672) -
Net cash flows from (for) noncapital financing activities(1,127,671) (142,954) (166,491) (285,338) 629,829 (89,227) (1,181,852) 147,012
Cash Flows from (for) Capital and Related
Financing Activities
Principal payments onlong-term debt(400,000) (129,244) (460,000) - (825,000) - (1,814,244) -
Interest payments on long-term debt(276,722) (27,287) (229,197) - (1,194,868) - (1,728,074) -
Acquisition ofproperty, plant and
equipment(3,639,991) (4,318,269) (3,129,018) (324,790) (225,300) (2,865,040) (14,502,408) (400,189)
Capital contributions received2,949,650 3,255,199 325,665 1,404,930 112,300 1,300,000 9,347,744 -
Insurance recovery - - - 522 - - 522 -
Increase (decrease) indue to other funds- - - (719,358) - 62,221 (657,137) -
Interfund loan payments- - (26,254) (147,013) (72,898) - (246,165) -
Commercial passenger vessel tax receipts- - 695,465 - - - 695,465 -
Increase in due to contractual agencies- - - - 27,000 - 27,000 -
Net cash flows from (for) capital and related
financing activities(1,367,063) (1,219,601) (2,823,339) 214,291 (2,178,766) (1,502,819) (8,877,297) (400,189)
Cash Flows from (for) Investing Activities
Investment income (loss)193,215 47,774 36,758 (1,582) 13 3,574 279,752 51,165
Interfund loan receipts19,552 - - - - - 19,552 226,613
Net cash flows from (for) investing activities212,767 47,774 36,758 (1,582) 13 3,574 299,304 277,778
Net Increase (Decrease) inCash
and Investments (978,387)853,211 (1,468,439) - 2,371,643 (1,147,318) (369,290) 521,424
Cash and Investments, beginning5,606,511 2,956,785 5,441,863 - 6,028,548 1,982,345 22,016,052 1,211,120
Cash and Investments, ending6,459,722$ 1,978,398$ 3,973,424$ -$ 8,400,191$ 835,027$ 21,646,762$ 1,732,544$
Reconciliation of Cash and Investments
toStatement ofNet Position
Current assets4,507,017$ 1,034,762$ 313,275$ -$ 6,426,831$ 835,027$ 13,116,912$ 1,732,544$
Restricted assets1,952,705 943,636 3,660,149 - 1,973,360 - 8,529,850 -
Total Cash and Investments$ 1,978,3986,459,722$ 3,973,424$ -$ 8,400,191$ 835,027$ 21,646,762$ 1,732,544$
See accompanying notes tobasic financial statements.
29
Exhibit C-3, continued
Cityof Seward, Alaska
Proprietary Funds
Statement of Cash Flows, continued
Enterprise Funds
Major Funds TotalInternal
HealthcareNonmajorEnterpriseService
Year Ended December 31, 2015ElectricWaterHarborSMICFacilitiesFundsFundsFunds
Reconciliation ofEarnings (Loss) from Operations
toNet Cash from (for) Operating Activities
Earnings (loss) from operations1,207,861$ 67,837$ (297,569)$ (666,852)$ (95,383)$ 136,714$ 352,608$ 31,756$
Adjustments toreconcile earnings (loss)
from operations tonet cash flows from (for)
operating activities:
Depreciation1,724,295 199,645 1,367,544 733,630 1,946,744 259,945 6,231,803 434,783
Other nonoperating revenues (expenses)(276,637) - - - - 239 (276,398) -
Other nonoperating revenues -
workorder reimbursements:
Salaries100,577 - - - - - 100,577 -
Supplies110,520 - - - - - 110,520 -
Noncash expense - PERS on-behalf52,010 12,462 34,987 - - 10,980 110,439 -
Increase in allowance for doubtful accounts1,849 801 9,601 - 737,000 333 749,584 -
Increase) decrease inassets and deferred
outflows ofresources:
Receivables(31,525) (18,657) (70,695) (17,414) 3,026,795 (7,404) 2,881,100 -
Prepaid expenses1,969 - - - - - 1,969 -
Inventory(58,387) (991) - - - - (59,378) -
Other assets- - - - (671,589) - (671,589) -
Deferred outflows ofresources related topensions(208,087) (49,861) (139,982) - - (43,929) (441,859) -
Increase (decrease) in liabilities and deferred
outflows ofresources:
Accounts payable78,608 13,461 344,204 (4,010) 60,000 (3,508) 488,755 -
Other payables- - - - (548,000) - (548,000) -
Accrued payroll andrelated liabilities(43,457) (3,866) (44,134) 822 (227,000) (9,369) (327,004) -
Accrued annual leave4,373 12,624 (1,879) - - 6,460 21,578 30,284
Customer deposits41,605 - 6,675 3,000 - - 51,280 -
Unearned revenue- - (13,117) 23,453 (308,000) - (297,664) -
Net pension liability495,186 118,654 333,116 - - 104,538 1,051,494 -
Deferred inflows of resources related topensions(65,582) (15,715) (44,118) - - (13,845) (139,260) -
Net Cash from Operating Activities 336,3943,135,178$ 1,484,633$ 72,629$ 3,920,567$ 441,154$ 9,390,555$ 496,823$
Noncash Capital and Related Financing Activities
Purchase ofcapital assets included inaccounts payable271,329$ -$ -$ 1,114,485$ -$ -$ 1,385,814$ -$
Seeaccompanying notes tobasic financial statements.
30
Exhibit D-1
City of Seward, Alaska
FiduciaryFund
Statement ofFiduciaryNet Position
Teen Council
December 31, 2015Agency Fund
Assets
Cash and investments$ 45,460
Other assets150
Total Assets$ 45,610
Liabilities
Accounts payable$ 5,625
Other accrued liabilities193
Due to Teen Council39,792
Total Liabilities$ 45,610
See accompanying notes to basic financial statements.
31
City of Seward, Alaska
Notes toBasic Financial Statements
December 31, 2015
1. SummaryofSignificant Accounting Policies
Reporting Entity
TheCityofSeward, Alaska (theCity) was incorporated June1, 1912 asahome-rulecityandoperates
underaCouncil-Manager form ofgovernment. TheCityprovides thefullrange ofmunicipal services
asprovided forbyAlaska Statute. This includes police andfireprotection, electric, water and
wastewater services, library, parks andrecreation, public improvements, planning andzoning, port
andharbor, hospital andlong-term care, andgeneral administrative services.
Theaccompanying financial statements present the CityofSeward. In 2011the City adopted the
The Financial Reporting Entity: Ombnibus. provisions ofGASB Statement number 61, Inconnection
therewith, the City reviewed itslegal andcontractual arrangements with theProvidence Seward
Medical Center which waspreviously reported asadiscreetly presented component unit, and
determined that, forfinancial reporting purposes inaccordance withgenerally accepted accounting
principles, thisactivity isappropriately recorded asanenterprise fund oftheCity. In2013, theCity
entered intoacontractual agreement with anon-profit organization asco-signees toafederally
funded health clinic program. The non-profit organization islegally separate anddoes notmeet the
criteriaunder GASB 61forinclusion asacomponent unit. However, many activities associated with
theclinic arereported in theSCHC Special Revenue Fund astheCityisthenamed grantee onthe
primary operating grant.
Thehospital andlong-term carefacilities (thePSMCC) areowned bytheCity ofSeward. The
facilities aremanaged byProvidence Health & Services ÏWashington, anonprofit corporation (the
Corporation), underamanagement andoperating agreement. Underthe operating agreement, the
Corporation isresponsible fordaytodaymanagement ofthehospital andlong-termcarefacilities in
exchange foramanagement fee. Allfinancial risks andrewards from theoperations ofthehospital
andlong-term care facilities accrue to theCity. TheCity isresponsible fordebt obligations,
including payment of revenue bonds through revenues generated atthePSMCC. TheCity pays forall
capital costs of thehealthcare facilities andislegallyobligated tofinance potential deficits.
Government-WideandFundFinancial Statements
Theaccounting policies of theCityconform toaccounting principles generally accepted intheUnited
StatesofAmerica asapplicable togovernments. Thefollowing isasummary ofthemore significant
policies:
Thegovernment-wide financial statements (i.e., the statement ofnet position andthestatement of
activities) reportinformation onallofthenonfiduciary activities oftheprimary government. In
general, theeffect ofinterfund activity hasbeen removed from these statements tominimize the
Governmental activitiesdouble-counting ofinternal activities. , which normally are supported by
business-typeactivities, taxes andintergovernmental revenues, arereported separately from which
rely primarily onfeesandcharges toexternal parties.
The statement ofactivities demonstrates thedegree towhich thedirect expenses ofagiven function
Direct expensesorsegmentareoffsetbyprogramrevenues. arethose thatare clearly identifiable
Program revenueswithaspecificfunctionorsegment. include 1) fees, fines andcharges to
customers or applicants whopurchase, use, ordirectly benefit from goods, services, or privileges
provided byagiven function orsegment and 2) grants andcontributions thatarerestricted to
meeting theoperational orcapital requirements ofaparticular function orsegment. Taxes,
investment income andother items notproperly included among program revenues arereported
general revenuesinsteadas .
32
City of Seward, Alaska
Notes toBasic Financial Statements
Separate financial statements are provided forgovernmental funds, proprietary funds, andfiduciary
funds, even though thelatterareexcluded from thegovernment-wide financial statements. Major
individual governmental funds andmajor individual enterprise funds arereported asseparate
columns inthefundfinancial statements.
Measurement Focus, BasisofAccounting andFinancial Statement Presentation
Thegovernment-wide andproprietary fund financial statements are reported using theeconomic
accrual basisofaccounting. resources measurement focus and the Revenues arerecorded when
earned and expenses arerecorded when aliability isincurred, regardless ofthe timing oftherelated
cashflows. Property taxes arerecognized asrevenues intheyearforwhich theyare levied. Grants
andsimilar items arerecognized asrevenue assoon as alleligibility requirements imposed bythe
provider have beenmet. The Fiduciary Fund alsousestheaccrual basis ofaccounting.
Governmental fund financial statements arereported using the current financial resources
modified accrualbasisofaccountingmeasurementfocusandthe . Revenues arerecognized assoon
availableastheyarebothmeasurableandavailable. Revenues areconsidered tobe when they are
collectible within thecurrent period orsoon enough thereafter topayliabilities ofthecurrent
period. Forthispurpose, the Cityconsiders allrevenues, except reimbursement grants, to be
available iftheyare collected within 60days after yearend. Reimbursement grants areconsidered
available iftheyarecollected within one yearofthe endofthe current fiscal period. Expenditures
generally arerecorded when aliability isincurred, as under accrual accounting. However, debt
service expenditures, aswell asexpenditures related tocompensated absences arerecorded onlyto
theextent theyhave matured.
Property taxes, sales taxes, charges forservices, andinterest associated with thecurrent fiscal
period areallconsidered tobesusceptible toaccrual andsohave beenrecognized asrevenues ofthe
current fiscal period. Only theportion ofspecial assessments receivable duewithin thecurrent fiscal
period isconsidered tobe susceptible to accrual asrevenue inthecurrent period. Most other
revenue items areconsidered tobemeasurable andavailable only whenreceived by thegovernment.
TheCityreports thefollowing major funds based onthe required quantitative criteria:
Major Governmental Funds:
General FundTheisthegovernmentÔs primary operating fund. Itaccounts forall financial
resources ofthegeneral government, except thoserequired tobereported inanother fund.
Major Proprietary Funds:
Electric Enterprise FundTheaccounts forallactivities related totheoperation oftheCityÔs
electric utility.
TheWater Enterprise Fund accounts foralltheactivities related totheoperation oftheCityÔs
water utility.
Harbor Enterprise FundTheaccounts forthemarine-related activities oftheCityÔs harbor.
Seward Marine Industrial Center (SMIC) Enterprise FundTheaccounts formarine-related services
ontheeast sideof Resurrection Bay.
Healthcare FacilitiesEnterprise FundTheaccounts forthehealthcare facilities, local hospital
andlong-term care facilities.
33
City of Seward, Alaska
Notes toBasic Financial Statements
TheCityalsoreports twoInternal Service Fundswhich account fortheactivities relating totheCityÔs
motorpoolactivities andcompensated absences ofthegovernmental funds. TheMotor PoolInternal
Service Fund reports revenues charged totheother funds based onrental feesandcapital lease
payments designed tocover thecost ofthelease payments andtofund depreciation. The
Compensated Annual Leave Internal Service Fund accounts fortheaccrual andpayment of
compensated absences ofthegovernmental activities.
Inaddition, theCitymaintains and reports onasinglefiduciary fund. Thisfundrecords cashheldina
fiduciary capacity onbehalfofthelocal teencouncil.
Asageneral ruletheeffect of interfund activity hasbeen eliminated from thegovernment-wide
financial statements. Exceptions to thisgeneral rule areallocated administration feesandcharges
between theenterprise funds andthevarious otherfunds anddepartments. Elimination ofthese
charges would distort the direct costs andprogram revenues reported for thevarious functions
concerned.
program revenuesAmountsreportedasinclude 1) charges to customers orapplicants forgoods,
services, orprivileges provided, 2) operating grants andcontributions, and3) capital grants and
generalcontributions, including special assessments. Internally dedicated resources arereported as
revenuesrather than as program revenues. Inaddition, general revenues include alltaxes,
investment income, andState ofAlaska entitlement revenues.
operatingnonoperatingProprietaryfundsdistinguishrevenuesandexpensesfrom items. Operating
revenues andexpenses generally result from providing services andproducing anddelivering goodsin
connection withaproprietary fundÔs principal ongoing operations. Operating expenses forthe
proprietary funds include thecosts ofsales and services, administrative expenses anddepreciation on
capital assets. Allrevenues andexpenses notmeeting thisdefinition arereported asnonoperating
revenues andexpenses.
PriorYears Amounts
Incertain schedules, prior year amounts have been presented forcomparison purposes. Some
amounts reported fortheprior yearhave been reclassified toconform tothecurrent year
presentation.
Central Treasury
Acentral treasury isused toaccount fortheCityÔs cash andinvestments to maximize investment
income. Investments arestated atfairvalue. Investment income isallocated among the funds
based ontheir respective cash balances.
CashandCashEquivalents
Forpurposes ofthestatement ofcash flows, theproprietary fundsconsider allcash and
investments tobecash andcash equivalents. Thecentral treasury, which holds cash and
investments, isused essentially asacash management pool byeach fund.
Inventory
Inventories arevalued at costingovernmental funds andatthelower ofcostormarket in the
proprietary funds. Cost isdetermined bythefirst-in, first-outmethod. Thecost isrecorded asan
expenditure orexpense at thetime individual inventory itemsare consumed (consumption
method).
34
City of Seward, Alaska
Notes toBasic Financial Statements
Prepaid Items
Certain payments tovendors reflect costs applicable tofuture accounting periods andare recorded
as prepaid items inboth government-wide andfundfinancial statements. Cost isrecorded asan
expenditure or expense astheprepayment isapplied (consumption method).
Receivables andPayables
Activity between funds thatarerepresentative oflending/borrowing arrangements outstanding atthe
endoftheyear arereferred toaseither Ñdue to / from other fundsÒ (i.e., thecurrent portion of
interfund loans) orÑadvances to / from otherfundsÒ (i.e., thenoncurrent portion ofinterfund loans).
Allother outstanding balances between funds arereported asÑdue to / from other funds.Ò Any
residual balances outstanding between thegovernmental activities andbusiness-typeactivities are
reported inthegovernment-widefinancial statements asÑinternal balances.Ò
Capital Assets
Capital assets, which include property, plant, equipment andinfrastructure assets (e.g. roads and
similar items), arereported intheapplicable governmental or business-typeactivities columns inthe
government-widefinancial statements. Capital assets are defined bytheCity asassets with an
initial, individual costofmore than $2,500andanestimated useful lifeinexcess ofoneyear. Such
assets are recorded athistorical costorestimated historical cost ifpurchased orconstructed.
Donated capital assets arerecorded at estimated fairmarket valueat thedateofdonation. Inthe
case ofthe initial capitalization ofinfrastructure assets, theCity chose toinclude all such items,
regardless oftheir acquisition date.
Thecosts ofnormal maintenance and repairs thatdonotaddtothevalue of theasset or materially
extend theuseful lifeoftheassetarenotcapitalized.
Major outlays forcapital assets and improvements arecapitalized asprojects areconstructed.
Interest incurred during theconstruction phase ofcapital assets ofbusiness-typeactivities isincluded
as partofthecapitalized value oftheassets constructed.
Property, plant, andequipment oftheCity isdepreciated using thestraight-linemethod overthe
following estimated useful lives:
ssets YearsA
Buildings and improvements 20-40 years
Infrastructure 50 years
System infrastructure 20-50 years
Machinery and equipment 3-8 years
Improvements other than buildings 3-40 years
Accrued AnnualLeave
TheCityallows employees to accumulate earned butunused vacation andsick leavebenefits. All
accrued leave isaccrued when incurred inthegovernment-wide, proprietary fund, andgovernmental
fund financial statements. Accrued leave thatisearned inthegovernmental funds isaccounted for
intheCompensated Annual Leave Internal Service Fund.
35
City of Seward, Alaska
Notes toBasic Financial Statements
Long-termDebt
Inthegovernment-wide andtheproprietary fundfinancial statements, long-term debt andother
long-term obligations arereported asliabilities intheapplicable governmental activities, business-
typeactivities, orproprietary fund typestatement ofnetposition. Bond premiums anddiscounts,
aredeferred and amortized overthe lifeofthe bondsusing thestraight-linemethod.
FundBalances
Inthefund financial statements, governmental funds report aggregate amounts forfive
classifications offund balances based on theconstraints imposed ontheuseofthese resources.
Thenonspendable fund balance classification includes amounts thatcannot bespent because they
areeither (a) notin spendable formÐprepaid itemsor inventories; or (b) legally orcontractually
required tobemaintained intact.
Thespendable portion ofthefund balances comprises theremaining four classifications:
restricted, committed, assigned, andunassigned.
Restricted fundbalanceÏThisclassification reflects theconstraints imposed onresources either
a) externally bycreditors, grantors, contributors, orlaws orregulations ofother governments; or
b) imposed bylawthrough constitutional provisions orenabling legislation.
Committed fundbalanceÏThese amounts canonly beused forspecific purposes pursuant to
constraints imposed byformal resolutions oftheCityCouncilÐthe governmentÔs highest levelof
decision making authority. Thosecommitted amounts cannot beused foranyother purpose unless
theCityCouncil removes thespecified use, alsothrough resolution. This classification also
includes contractual obligations tothe extent thatexisting resources inthefund have been
specifically committed forusein satisfying those contractual requirements.
Assigned fundbalanceÏThisclassification reflects theamounts constrained bytheCityÔs ÑintentÒ
tobe usedforspecific purposes, butareneither restricted norcommitted. CityResolution 2009-
131delegates authority toassign fund balance totheCity Manager andtheFinance Director.
Assigned fundbalances, bydefault, include allremaining amounts (exceptnegative balances) that
arereported ingovernmental funds, other than theGeneral Fund, that arenotclassified as
nonspendable andareneither restricted norcommitted.
Unassigned fundbalanceÏThis fund balance istheresidual classification fortheGeneral Fund. It
isalsoused toreport negative fund balances inother governmental funds.
When bothrestricted andunrestricted resources areavailable foruse, itistheCityÔs policy touse
externally restricted resources first, thenunrestricted resourcesÐcommitted, assigned, and
unassignedÐin order asneeded.
Encumbrances
Encumbrance accounting, under which purchase orders, contracts andother commitments for
expenditures arerecorded inorder toreserve that portion oftheapplicable appropriation, is
employed asan extension of formal budgetary integration intheGeneral Fund during theyear.
However, itistheCityÔspolicy tostopissuing purchase orders inearly December. As aresult, there
arenooutstanding encumbrances atDecember 31, 2015. Outstanding purchase orders, ifany, at
December 31, arecancelled andnewones areissued inthesubsequent year.
36
City of Seward, Alaska
Notes toBasic Financial Statements
Unearned Grant Revenue
Amounts received from grantor agencies, which are restricted astouseandhave notbeen expended
forthe intended use, areshown asunearned revenue.
Grant andOther Intergovernmental Revenues
In applying themeasurable andavailable concepts togrants andintergovernmental revenues, the
legalandcontractual requirements ofthenumerous individual programs are usedasguidance. There
are, however, essentially two types oftheserevenues. Inone, monies must be expended onthe
specific purpose or project beforeanyamounts are considered ÑearnedÒ; therefore, revenues are
recognized based upon expenditures recorded. Intheother, monies arevirtually unrestricted asto
purpose of expenditure andareusually revocable only forfailure tocomply with prescribed
compliance requirements. These resources arereflected asrevenues atthetimeofreceipt orearlier
ifthemeasurable andavailable criteria aremet.
Pension Plan
With theexception ofcertainElectric Fund employees, substantially allother employees oftheCity
participate inthePublic Employees' Retirement System (PERS) administered bytheState ofAlaska.
Certain electric employees participate inthe International Brotherhood ofElectric Workers (IBEW)
Plan.
Property Taxes
Property taxesare liensonthe assessed value of taxable property as ofJanuary 1. Pursuant toAlaska
Statutes, theCityestablishes themillrateandtaxlevy onorbefore June 15. TheCity islocated
within theKenai Peninsula Borough, which actsas theCityÔs agent inthebilling andcollection of
property taxes. Taxbillsfor one-halfofthetaxes aremailedprior toJuly 1andarepayable on
August 15; tax billsforthesecond-halfofthetaxes are mailed byOctober 1and arepayable on
November 15. City property taxrevenues are recognized in thefiscal yearinwhich they are
collectible andavailable (collected withinsixty days after year-end) to finance expenditures ofthe
fiscal year.
AtDecember 31, thedelinquent realandpersonal property taxes notcurrently available are
reflected asdeferred inflows ofthe General Fund.
2. Stewardship, Compliance, andAccountability
Budgetary Information
Anoperating budget isadopted eachfiscal year fortheGeneral Fundonthesame modified
accrual basis used toreflect actual revenues andexpenditures. Appropriations forthisfund lapse
at year-end tothe extentthat theyhave notbeen expended. Budgetary control isexercised atthe
department level. TheCity Manager isauthorized totransfer budget amounts between
departments within afund orbetween lineitemswithin departments, butCityCouncil approval is
required totransfer budget amounts between funds.
37
City of Seward, Alaska
Notes toBasic Financial Statements
Allocation ofSalesTax Revenues
When theCitytransferred theoperations oftheHospital toProvidence Seward Medical andCare
Center onJuly 1, 1996, theCity agreed toallocate 1% ofthesales taxforthebenefit ofthe
Hospital. During construction, theallocated salestax wasusedtooffset losses andtransition
costs. Subsequent tocompletion oftheconstruction, theallocated sales tax hasbeen usedto
fund thedebtservice ontheHospital general obligation bonds. Upon maturity ofhospital bonds,
sales taxrevenues willbeused tofund healthcare capital andoperating costs, and debtservice on
long-term care facility bonds, ifnecessary. Allsales taxrevenue isrecorded intheGeneral Fund.
Theallocated portion isthen transferred totheHealthcare Facilities Enterprise Fund fordebt
service.
3. Cash andInvestments
TheCityofSeward maintains acentral treasury thatisavailable foruseby allfunds. Each fundÔs
portion ofthecentral treasury isdisplayed onthebalance sheet as ÑcashandinvestmentsÒ orin
thecaseofÑnegative cash,Òisincluded inÑdue toother funds.Ò
Investments
City statutes authorize theCity toinvest inobligations oftheU.S. Treasury and U.S. agencies,
bankersÔ acceptances, repurchase agreements, commercial paper issuedbycorporations or
businesses andhaving thehighest rating ofanationally-recognized rating service andmaturing
within ninemonths, certificates ofdeposit insured byfederal depository insurance orsecured by
eligible collateral heldbyathird party intheCityÔs name, andinvestments through theAlaska
Municipal League Investment Pool (AMLIP). TheCityÔs investment policydoes notspecify a
maximum investment maturity, buttheCitygenerally invests funds forlessthanthree years from
thedate ofpurchase. TheCityhascomplied withitsinvestment policy throughout theyear. The
CityÔs investments arerecorded atfairvalue.
TheAMLIP isanexternal investment poolwhichisrated AAAm forcredit riskpurposes. Alaska
Statute 37.23establishes regulatory oversight ofthePool. The lawsets forth numerous
requirements regarding authorized investments andreporting. Onamonthly basis the
investments inthePool arereviewed forfair value byanindependent pricing service. Thevalues
ofinvestments intheAML Pool areapproximately equal to fairvalue.
Reconciliation ofDeposit andInvestment Balances
Thefollowing isareconciliation oftheCityÔs deposit andinvestment balances tothefinancial
statements asofDecember 31, 2015:
Fiduciary Fund
Government-Wide Statement of
Statement ofNet Fiduciary
PositionNet PositionTotals
Cash and investments $23,173,100$45,460$23,218,560
Restricted cash and investments 8,529,850-8,529,850
TotalCashandInvestments 31,702,950$45,460$31,748,410
38
City of Seward, Alaska
Notes toBasic Financial Statements
Restricted Cashand Investments
TheCity maintains bond redemption andreserve accounts asrequired by bond covenants. The
balances atDecember 31, 2015 areasfollows:
Healthcare Facilities Fund $1,973,360
Electric Fund 396,036
Harbor Fund 690,198
TotalRestricted forBondRetirement 3,059,594
TheCityalsoincludes inrestricted cash andinvestments amounts thathavebeen designated for
capital projects. The total amount of restricted cash andinvestments thathasbeen designated
forcapital projects follows:
Harbor Fund $2,969,951
Electric Fund 1,556,669
Water Fund 943,636
TotalRestricted forCapital Projects 5,470,256
Custodial Risk
Thefairvalue oftheCityÔs investments atyear-endisshown below. GASB Statement 3, as
amended byGASB Statement 40, establishes categories asanindication of thelevel of custodial
riskinvolved intheinvestments. AlloftheCityÔs remaining investments arein thecategory of
least riskandinclude investments thatareinsured orregistered intheCityÔs name, orsecurities
thatare heldbytheCityoritsagent in theCityÔs name. All oftheUnited States treasury bills,
treasury notes, and United States agency securities areheldincustodial accounts inthe U.S. Bank
andBank ofNew York Trust Departments andarerecorded intheCityÔs name, inaccordance with
safekeeping agreements. U.S. Bank andBank of New York arenotcounter parties tosecurity
transactions.
Interest RateRisk
Thefairvalue oftheCityÔs fixed-income investments fluctuate inresponse tochanges inmarket
interest rates. Increases inprevailing interest rates generally translate intodecreases infair
value ofthose investments. Fairvalues ofinterest rate-sensitive instruments maybe affected by
the creditworthiness of theissuer, prepayment options, relative values ofalternative investments,
theliquidity oftheinstrument, and othergeneral market conditions. TheCity manages interest
rateriskbyallocating specific percentages oftheportfolio over specified time periods, and
generally holds investments forlessthanfiveyears, which minimizes thesensitivity offairvalue
tochanges inmarket interest rates. TheCityhasno formal policy relating toaspecific deposit or
interest rate risk.
39
City of Seward, Alaska
Notes toBasic Financial Statements
Investment types andtheir maturities atDecember 31, 2015areasfollows:
Investment Maturities (inYears)
Less than 1
Investment Fair Valueyear1 to5yearsOver 5years
Certificates ofdeposit $5,209,622$2,008,101$3,201,521$-
U.S. government agencies 1,355,530-1,355,530-
U.S. treasury SLGS 247,300--247,300
U.S. government bonds 8,031,104-8,031,104-
TotalSubjecttoInterest RateRisk 14,843,556$2,008,101$12,588,155$247,300
Pooled investments 6,090,628
Money market account 4,335,375
Total investments 25,269,559
Bank deposits 6,478,851
TotalCashandInvestments 31,748,410
Option Risk
Option riskisthe riskthataninvestmentÔs counterparty may exercise aright embedded inthe
investment Ïanembedded option. TheCity invests insecurities issued byU.S. government
agencies thatcontain callprovisions. Theexercise of thecalloption bythe counterparty occurs
during times ofdeclining interest rates; therefore theCityisexposed totheriskof having to
reinvest atalower interest rate. Inthetable above, securities arecategorized according tothe
final maturity, regardless ofcalloption dates. Ifcalloptions were exercised atthenext possible
calldate, many ofthecallable securities would mature inlessthan oneyear.
Concentration Risk
TheCityÔs investment policy places nolimit ontheamount thatcanbeinvested inanyone issuer.
Approximately 11% of thetotal portfolio isinvested insecurities issued byfederal agencies and
approximately 10% isheldwiththe Federal HomeLoan Bank.
CreditRisk
Generally, credit risk istherisk thatanissuer of aninvestment will notfulfill itsobligation tothe
holder oftheinvestment. This ismeasured bytheassignment ofaratingby anationally
recognized statistical rating organization. Theinvestments inU.S. government agencies include
Federal Home Loan Bank andU.S. Treasuries. Allofthe U.S. government agencies investments
arerated AAA byStandard and PoorÔs.
TheCityÔs investment policy specifies thetypes ofinvestments that canbepurchased, inorder to
limit credit risk. TheCity mayinvest inobligations oftheUnited Statesgovernment, itsagencies
andinstrumentalities; insured or collateralized certificates of deposit; savings accounts;
collateralized repurchase agreements; commercial paper maturing within ninemonths issuedby
corporations having thehighest rating ofanational rating agency; bankersÔ acceptances; andthe
State investment pool. Credit riskismitigated bylimiting theeligible investment options.
40
City of Seward, Alaska
Notes toBasic Financial Statements
4. Capital Assets
Capital asset activity fortheyearendedDecember 31, 2015 wasas follows:
Balance Balance
and andAdditionsDeletionsJanuary1, December 31,
Governmental Activities Reclassifications Reclassifications20152015
Capital assets not being depreciated:
Land and land improvements $5,509,589$-$-$5,509,589
Construction in progress 258,593459,786215,540502,839
Total assets not being depreciated 5,768,182459,786215,5406,012,428
Capital assets being depreciated
Buildings 70,147,968105,784-70,253,752
Improvements other than buildings 22,395,774442,288449,39322,388,669
Machinery and equipment 15,012,445811,9796,68915,817,735
Total assets being depreciated 107,556,1871,360,051456,082108,460,156
Less accumulated depreciation for:
Buildings 24,380,0861,679,129-26,059,215
Improvements other than buildings 15,066,976362,072449,39314,979,655
Machinery and equipment 10,847,108881,3566,68911,721,775
Total accumulated depreciation 50,294,1702,922,557456,08252,760,645
Total capital assets being depreciated,
net 57,262,017(1,562,506) -55,699,511
Governmental Activity Capital Assets,
net$63,030,199$(1,102,720) $215,540$61,711,939
Theending balances include $6,563,057and $4,444,792ofequipment costandaccumulated
depreciation, respectively, related tothe Motor Pool Internal Service Fund.
Theremainder ofthispageintentionally leftblank.
41
City of Seward, Alaska
Notes toBasic Financial Statements
BalanceBalance
January 1, Additions and Deletions and December 31,
Business-type Activities 2015Reclassifications Reclassifications2015
Capital assets not being depreciated:
Land and land improvements $30,639,257$-$-$30,639,257
Construction in progress 6,095,41512,185,2211,103,13217,177,504
Total assets not being depreciated 36,734,67212,185,2211,103,13247,816,761
Capital assets being depreciated
Buildings 37,128,716--37,128,716
Infrastructure 970,606--970,606
Improvements other than buildings 135,074,2684,295,979-139,370,247
Machinery and equipment 18,032,556233,931126,83618,139,651
Total assets being depreciated 191,206,1464,529,910126,836195,609,220
Less accumulated depreciation for:
Buildings 14,437,2951,341,585-15,778,880
Infrastructure 375,47780,606-456,083
Improvements other than buildings 84,118,4813,965,704-88,084,185
Machinery and equipment 11,377,458843,908107,09412,114,272
Total accumulated depreciation 110,308,7116,231,803107,094116,433,420
Total capital assets being
depreciated, net 80,897,435(1,701,893) 19,74279,175,800
Business-type Capital Assets, net$117,632,107$10,483,328$1,122,874$126,992,561
Depreciation for the year ended December 31, 2015 was charged to the functions as follows:
Depreciation Internal
Excluding Internal Service Fund Total
Governmental Activities Service FundAllocationDepreciation
General government $218,618$103,673$322,291
Public safet 202,877121,407324,284y
Public works 275,328187,195462,523
Parks and recreation 90,78922,508113,297
Librar 242,854-242,854y
SeaLifeCente 1,457,308-1,457,308r
TotalGovernmental Activities 2,487,774$434,783$2,922,557
42
City of Seward, Alaska
Notes toBasic Financial Statements
Depreciation
Excluding
Internal
Business-typeActivities Service Fund
Electric $1,724,295
Wate199,645r
Wastewate 235,468r
Harbo 1,367,544r
SMIC 733,630
Parking 24,477
Healthcare facilities 1,946,744
TotalBusiness-typeActivities 6,231,803
5. Interfund Receivables, Payables andTransfers
Aschedule ofinterfund balances andtransfers asofandfortheyear ended December 31, 2015,
follows. Interfund balances typically resultfrom short-term operating orcapital advances.
Transfers typically result from capital matching, operating subsidies, andpayment inlieuoftaxes.
Due FromOtherFunds
Duetothe General Fund from the SMIC Enterprise Fund$185,768
DuetotheGeneral Fund from Nonmajor Governmentalunds1,158,142F
Duetothe General Fund from Nonmajor Enterpriseunds62,221F
TotalDueFromOther Funds 1,406,131
Transfers
From General Fund to:
SMIC Enterprise Fund $27,520
Harbor Enterprise Fund 176,024
Electric Enterprise Fund 110,784
Healthcare Facilities Enterprise Fund1,129,829
Nonmajor governmental funds 641,479
Total transfers from General Fund 2,085,636
From SMIC Enterprise Fund to:
General Fund 98,009
Harbor Enterprise Fund 67,837
Nonmajor internal service fund 147,012
Total transfers from SMIC Enterprise Fund312,858
43
City of Seward, Alaska
Notes toBasic Financial Statements
Transfers, continued
FromWater Enterprise Fund to:
General Fund $112,128
Nonmajor enterprise fund 30,826
Total transfers from Water Enterprise Fund142,954
From nonmajor governmental funds toGeneral Fund1,283
From Electric Enterprise Fund toGeneral Fund1,238,455
From Harbor Enterprise Fund toGeneral Fund 410,352
From nonmajor enterprise fund toGeneral Fund120,053
From nonmajor governmental funds toother nonmajor governmentalfunds300,000
From Healthcare Facilities Enterprise Fundtononmajogovernmental fund500,000r
Total Transfers toOtherFunds 5,111,591
TheCityhasfour outstanding interfund loans.
In 2006, theMotorPool Fund andthe Electric Fundissued interfund loans inthetotalamount of
1,708,125totheHealthcare Facilities Enterprise Fund forthepurpose ofpaying theSeward
General Hospital PERS unfunded liability. Repayment isscheduled over twenty years bearing
interest at5.25%.
Alsoin2006, theMotor PoolFund loaned $220,258totheHarbor Enterprise Fundforthepurpose of
purchasing a50-tonBoat Lift. Theloanisfortenyears andbears interest at5.5% peryear.
In2009, theWater Fundloaned $1,973,360totheGeneral Fund tobeused asadebtservice
collateral account. Because thecash isrestricted fordebtservice andisheldin abankaccount for
thatpurpose, allinterest earnings ontheaccount accrues totheWaterFund andinterest isnot
charged totheGeneral Fund. In2012 thisloanwasreassigned tothe Healthcare Facilities Fund.
In2014, theMotor PoolFund loaned $1,029,087 totheSMIC Fund forthepurpose ofpurchasing a330-
tonBoat Lift. Theloanistoberepaid insevenannual installments of $147,012foratotalamount of
1,029,087.
Amounts outstanding atDecember 31, 2015 follow:
Payable from theHealthcare Facilities Enterprise Fundto:
Motor Pool Internal Service Fund $808,172
Electric Enterprise Fund 296,195
Total payable from theHealthcare Facilities Enterprise Fund1,104,367
Payable from theHarbor Enterprise Fund toMotor Pool Internal Service Fund27,698
Payable from the SMIC Enterprise Fundto Motor Pool Internal Service Fund882,074
Total Interfund LoansPayable 2,014,139
44
City of Seward, Alaska
Notes toBasic Financial Statements
6. Long-term Liabilities
Thefollowing isasummary oflong-term liability transactions oftheCity fortheyear ended
December 31, 2015:
Balance at Balance at Due
January 1, December 31, Within
Governmental Activities 2015AdditionsRetirements2015One Year
General obligation bonds -
3,480,000 2012 General
Obligation bonds, due in annual
installments of $95,000 to
240,000, plus interest at 4.0%
to 5.0% through September 1,
2036 $3,395,000$-$90,000$3,305,000$95,000
Accrued leave 475,070670,507640,223505,354116,215
Net pension liabilit 3,827,0282,493,599-6,320,627- y
Total Governmental Activities
Long-term Liabilities, restated 7,697,098$3,164,106$730,22310,130,981$211,215
Plus unamortized bond premium 216,546
10,347,527
Theopening balance has been restated toreflect thenewly required netpension liability.
Liquidation ofgovernmental accrued annual leave ismade bytheCompensated Annual Leave
Internal Service Fund. Allother debt service payments above aremade by theGeneral Fund or
Motor Pool Internal Service Fund.
Theremainder ofthispageintentionally leftblank.
45
City of Seward, Alaska
Notes toBasic Financial Statements
Balance at Balance at Due
January 1, December 31, Within
Business-type Activities 2015AdditionsRetirements2015One Year
Revenue bonds:
6,000,000 2008 electric
revenue bonds, due in annual
installments of $130,000 to
375,000, plus interest at 4.0%
to 6.0% through June 1, 2038 $5,370,000$-$125,000$5,245,000$130,000
27,000,000 2008 Series One
long-term care facility bonds,
due in annual installments of
865,000 to $1,875,000, plus
interest at 4.0% to 5.1%
through April 1, 2033 24,075,000 -825,00023,250,000865,000
4,500,000 2006 harbor
revenue bonds, due in final
installment of $215,000, plus
interest at 4.0% on June 1,
2016 425,000 -210,000215,000215,000
1,965,000 2007 refunding
harbor revenue bonds, due in
annual installments of
190,000 to $235,000, plus
interest at 4.0% to 5.0%
through June 1, 2021 1,440,000 -175,0001,265,000190,000
2,290,000 2005 refunding
electric revenue bonds, due in
final installment of $275,000,
plus interest at 5.0% on June
1, 2015 275,000 -275,000--
1,500,000 2005 harbor
revenue bonds, due in final
installment of $75,000, plus
interest at 5.0% on June 1,
2015 75,000-75,000--
46
City of Seward, Alaska
Notes toBasic Financial Statements
Balance atBalance at Due
January 1,December 31, Within
2015AdditionsRetirements2015One Year
Revenue bonds, continued:
3,405,000 2014 refunding
harbor revenue bonds, due in
annual installments of $65,000
to $400,000, plus interest at
1.25% to 5.00% through April
1, 2026 $ 3,405,000$-$-$3,405,000$65,000
Notes payable:
678,740 sewer note payable
to State of Alaska Department
of Environmental
Conservation, due in annual
installment of $29,353 and
39,534, plus interest at 1.5%
through September 11, 2035 -678,740-678,74029,353
685,232 sewer note payable
to State of Alaska Department
of Environmental
Conservation, due in annual
installment of $29,633 and
39,912, plus interest at 1.5%
through September 11, 2035 -685,232-685,23229,633
2,652,849 water note payable
to State of Alaska Department
of Environmental
Conservation, due in annual
installments of $156,844,
including interest at 1.5%
through April 1, 2027 1,840,021-129,2441,710,777131,182
1,201,196 harbor note payable
to U.S. Department of
Defense, payment terms are
yet to be established 1,201,196--1,201,196-
Accrued leave 159,166376,551355,244180,47358,377
1,613,7721,051,494-2,665,266- Net pension liability
Total Business type Activities
Long-term Liabilities, restated 39,879,155$2,792,017$2,169,48840,501,684$1,713,545
Plus unamortized bond premium 830,046
41,331,730
47
City of Seward, Alaska
Notes toBasic Financial Statements
Annual debt service requirements tomaturity onthebonds andnotes follow:
General Obligation BondsGovernmentalActivities
YearEnding December 31, PrincipalInterestTotal
2016 $95,000$151,550$246,550
2017 100,000146,800246,800
2018 105,000141,800246,800
2019 110,000136,550246,550
2020 115,000132,150247,150
2021-2025 665,000570,1501,235,150
2026-2030 825,000407,5001,232,500
2031-2035 1,050,000190,5501,240,550
2036 240,00010,200250,200
3,305,000$1,887,250$5,192,250
Revenue Bonds Business-typeActivities
YearEnding December 31, PrincipalInterestTotal
2016 $1,465,000$1,560,630$3,025,630
2017 1,525,0001,500,825 3,025,825
2018 1,580,0001,436,3883,016,388
2019 1,650,0001,369,2263,019,226
2020 1,715,0001,297,357 3,012,357
2021-2025 8,775,0005,301,17414,076,174
2026-2030 8,795,0003,141,34811,936,348
2031-2035 6,810,000896,7177,706,717
2036-2038 1,065,00085,9691,150,969
33,380,000$16,589,634 $49,969,634
Notes Payable Business-typeActivities
YearEnding December 31, PrincipalInterestTotal
2016 $190,168$25,662$215,830
2017 193,02143,269236,290
2018 195,91640,374236,290
2019 198,85537,434236,289
2020 201,83834,452236,290
2021-2025 1,055,519125,9251,181,444
2026-2030 659,47251,446710,918
2031-2035 379,960 17,269397,229
3,074,749$375,831$3,450,580
48
City of Seward, Alaska
Notes toBasic Financial Statements
Defeased DebtOutstanding
AtDecember 31, 2015defeased debtoutstanding totaled $2,745,000related tothe2005Harbor
Revenue Bonds. Thesebondscarryacalldate ofJune1, 2016.
DebtIssued Subsequent toYearEnd
Subsequent toyearend, the Cityissued $17,135,000inadvance refunding revenuebonds to
refinance $20,530,000oftheoutstanding 2008Long-TermCareFacility Revenue bonds. Thenew
bonds wereissued atapremium of $1,694,523andwillresult inatotalcashflowsavings of
8,221,963. Inaddition, in2016, theCity issued $5,045,000 inadvancerefunding revenue bonds
torefinance $4,840,000oftheoutstanding 2008Electric Revenue Bonds. Thesebondswereissued
atapremiumof $318,189andwill resultinatotalcashflowsavings of $1,043,700. The cityalso
issued $1,055,000inadvance refunding G.O. bonds torefinance $1,075,000oftheoutstanding
2007 refunding harborrevenue bonds. Therebondswere issued atapremiumof $25,424andwill
resultinatotalcashsavings of $54,707.
7. Revenue Bond Requirements
Certain covenants oftherevenue bonds require establishment ofbondredemption andreserve
accounts. Thebalances arereflected asrestricted cashandinvestments atDecember 31, 2015as
follows:
Long-termcarefacility bondreserves$ 1,973,360
Electric bondreserves 396,036
Harbor bondreserves 690,198
The remainder ofthis page intentionally leftblank.
49
City of Seward, Alaska
Notes toBasic Financial Statements
TheElectric andHarbor revenue bonds alsorequire thatratesbemaintained atalevel thatwill
produce netrevenues aftercertain adjustments, equal to1.3and1.2, respectively, times the
amount required each year to paytheprincipal andinterest. TheCity met these revenue
requirements forbothbonds in2015. Thebond coverage calculations areasfollows:
Electric Revenue Bonds
Total revenues, excluding grants $11,674,228
Total operating expenses, excluding depreciation(8,887,162)
Available forDebt Service 2,787,066
Debt service payments:
Principal $400,000
Interest 276,722
TotalDebtService Payments 676,722
DebtCoverage 4.12
Harbor Revenue Bonds
Total revenues, excluding grants $3,396,213
Total operating expenses, excluding depreciation(2,289,480)
Availableor DebtService 1,106,733f
Debt service payments:
Principal $460,000
Interest 229,197
TotalDebtService Payments 689,197
DebtCoverage 1.61
50
City of Seward, Alaska
Notes toBasic Financial Statements
8. Fund Balance
Fund balances, reported forthemajor fund andthenonmajor fund intheaggregate onthe
governmental funds balance sheet aresubject tothefollowing constraints:
General Nonmajor
FundFundsTotals
Nonspendable:
Inventory $8,711$-$8,711
Prepaid items 591,5979,676601,273
Total nonspendable 600,3089,676609,984
Committed:
Working capital 1,500,000-1,500,000
Insurance 126,418-126,418
Hospital line of credit500,000-500,000
Total committed 2,126,418-2,126,418
Assigned:
Park and recreation -2,4982,498
Public works -4,2594,259
General government -5,6415,641
Clinic -102,538102,538
Insurance 224,465-224,465
Capital projects 100,000-100,000
Other assignments -2,392,8052,392,805
Total assigned 324,4652,507,7412,832,206
Unassigned 4,718,517-4,718,517
TotalFundBalances 7,769,708$2,517,417$10,287,125
9. Defined Benefit (DB) Pension Plan
General Information About thePlan
TheCityparticipates intheAlaska PublicEmployeesÔ Retirement System (PERS). PERS isacost-
sharing multiple employer planwhich covers eligible State andlocal government employees, other
thanteachers. ThePlan wasestablished andisadministered bythe State ofAlaska Department of
Administration. Benefit and contribution provisions areestablished byState lawandmay be
amended onlybytheState Legislature.
ThePlan isincluded in acomprehensive annual financial report thatincludes financial statements
andother required supplemental information. That report isavailable viathe internet at
http://doa.alaska.gov/drb/pers. Actuarial valuation reports, audited financial statements, and
other detailed planinformation arealsoavailable onthiswebsite.
51
City of Seward, Alaska
Notes toBasic Financial Statements
The Planprovides forretirement, death anddisability, andpost-employment health carebenefits.
There arethree tiers ofemployees, based onentry date. Forall tiers within theDefined Benefit
DB) plan, full retirement benefits aregenerally calculated using aformula comprised ofa
multiplier times theaverage monthly salary (AMS) times thenumber ofyears of service. The
multiplier isincreased atlongevity milestone markers formost employees. Police/Fireemployees
accrue benefits atanaccelerated rate. Thetiers withinthePlan establish differing criteria
regarding normal retirement age, early retirement age, and thecriteria forcalculation ofAMS,
COLA adjustments, andother OPEB benefits. Acomplete benefit comparison chart isavailable at
thewebsite noted above.
The PERS DBPlanwasclosed tonewentrants effective June 30, 2006. Newemployees hired after
thatdateparticipate inthePERS Defined Contribution (DC) Plan described later inthese notes.
Historical Context and Special Funding Situation
InApril 2008, theAlaska Legislature passed legislation converting thepreviously existing PERSplan
from anagent-multiple employer plan toacost-sharing plan withaneffective dateofJuly 1,
2008. Inconnection with thisconversion, theState ofAlaska passed additional legislation which
statutorily capped theemployer contribution rate, established astate funded Ñon-behalfÒ
contribution (subject tofunding availability), andrequired thatemployer contributions be
allcalculatedagainstPERS eligible wages, including wages paidtoparticipants ofthePERS Tier IV
defined contribution plan described later inthesenotes.
Alaska Statute 39.35.255requires theState of Alaska tocontribute tothePlan anamount such
that, when combined with theemployer contribution, issufficient topaythePlanÔs pastservice
liability contribution rateas adopted bytheAlaska Retirement Management Board.
Although current statutes callfortheState of Alaska tocontribute to thePlan, theAlaska
Department ofLaw determined that thestatute does notcreate alegal obligation to assume the
liabilities ofthePlan; rather itestablishes acontribution mechanism toprovide employer relief
against therising contribution rates. This relief payment issubject tofunding availability, and
notthereforenotlegallymandated. Asaresult, theState initially determined thatthePlan is in
aspecial funding situation. Following much discussion with various stakeholders, participant
communities, attorneys, auditors, and theGASB itself, theStatehassubsequently reversed its
position onthismatter, andasofJune 30, 2015, theState did record theliability presuming that
thecurrent statute does constitute aspecial funding situation asthelegislation iscurrently
written. Itisimportant tonote thattheAlaska Legislature hasthe powerandauthority tochange
theaforementioned statute through thelegislative process, anditis likely thattheState will
pursue efforts todosoin afuture legislative session.
Forthecurrent yearfinancial statements, management hastreated AS39.35.255 asconstituting a
special funding situation under GASB 68rules andhasrecorded allpension related liabilities,
deferred inflows/outflows, anddisclosures onthisbasis.
TheCityrecords these on-behalf contributions asrevenue andexpense/expenditures asdictated
bythegoverning GAAP foreachbasisofaccounting depending on fund type.
52
City of Seward, Alaska
Notes toBasic Financial Statements
Employee Contribution Rates
Regular employees arerequired tocontribute 6.75% oftheir annual covered salary. Police and
firefighters arerequired tocontribute 7.5% of their annual covered salary.
Employer andOther Contribution Rates
There areseveral contribution rates associated with the pension andhealthcare contributions and
relatedliabilities. These amounts arecalculated onanannual basis.
Employer Effective Rate: This isthecontractual employer pay-inrate. Under current legislation,
thisrateisstatutorily capped at22% ofeligible wages, subject toawage floor, andother termination
allevents. This 22% rate iscalculated on PERS participating wages, including those wages
attributable toemployees inthedefined contribution plan. Contributions derived from thedefined
contribution employees arereferred to astheDefined Benefit Unfunded Liability orDBUL
contribution.
ARMBoard Adopted Rate: This istherate formally adopted bythe Alaska Retirement
Management Board. This rateisactuarially determined andused tocalculate annual Plan funding
requirements, without regard tothestatutory rate caportheGASBaccounting rate. Prior to July
1, 2015, there were noconstraints orrestrictions ontheactuarial cost method orother
assumptions used intheARM Board valuation. Effective July1, 2015, theLegislature requires the
ARMBoard toadopt employer contribution rates forpastservice liabilities using alevel percent of
paymethod over aclosed 25yearterm which ends in2039. This willresult inlower ARM Board
Rates infuture years (asdemonstrated inthecontribution ratetables below).
On-behalf Contribution Rate: This istheratepaid inbytheState asanon-behalfpayment under
thecurrent statute. The statute requires theState tocontribute, based onfunding availability,
anon-behalf amount equal tothedifference between theARM Board Rate andtheEmployer
Effective Rate. However, instate fiscal year2015, theState Legislature appropriated aone-time
contribution tothePlan intheamount of $1billion. Asaresult, theOn-behalf Contribution Rate
forState Fiscal Year 2015 (July1, 2014 ÏJune 30, 2015) significantly exceeds thestatutory
amount. In thegovernmental fund financial statements, on-behalf contribution amounts have
been recognized as additional revenues andexpenditures. Ontheenterprise fund and
government-wide financial statements, theon-behalf amounts areincluded in revenue and
expense only tothe extent theyareapplicable tothemeasurement period.
GASBRate: This istherateused todetermine thelong-term pension andhealthcare liability for
planaccounting purposes in accordance with generally accepted accounting principles as
established byGASB. Certain actuarial methods andassumptions forthis ratecalculation are
mandated byGASB. Additionally, theGASB Rate disregards allfuture Medicare PartDpayments.
ForFY15, therateusesan8.00% pension discount rateanda4.90% healthcare discount rate.
TheGASB Rate andtheARM BoardAdopted Rate differsignificantly asadirect result ofvariances
intheactuarial methods andassumptions used.
53
City of Seward, Alaska
Notes toBasic Financial Statements
Contribution ratesforthe yearsended June30, 2015 and June30, 2016 were determined in the
June 30, 2012 andJune 30, 2013 actuarial valuations, respectively. City contribution rates forthe
2015 calendar yearwere asfollows:
EmployeARM Board Stater
Effective Adopted ContributionGASB
January 1, 2015toJune 30, 2015 Rate RateRate Rate
Pension 12.54%25.09%42.41%33.05%
Postemployment healthcare (see
Note 11) 9.46% 18.94% - %55.07%
TotalContribution Rates 22.00%44.03%42.41%88.12%
Employe ARM Board Stater
Effective Adopted ContributionGASB
July1, 2015toDecember 31, 2015 Rate RateRate Rate
Pension 13.25%16.38%3.63%37.79%
Postemployment healthcare (see
Note 11) 8.75% 10.81% 1.56%58.73%
TotalContribution Rates 22.00%27.19%5.19%96.52%
In 2015, theCitywascredited withthefollowing contributions intothepension plan.
Measurement PeriodCity Fiscal Year
July1, 2014 January 1, 2015
to to
June 30, 2015 December 31, 2015
Employer contributions (including DBUL)$ 505,599$ 485,647
Nonemployer contributions (on-behalf)2,315,9461,357,781
TotalContributions 2,821,545$ 1,843,428
Inaddition, employee contributions to theplantotaled $170,303during the CityÔs fiscal year.
Pension Liabilities, Pension Expense, andDeferred Outflows ofResources andDeferred
Inflows ofResources Related toPensions
AtDecember 31, 2015, theCityreported aliability foritsproportionate share ofthenetpension
liability (NPL) thatreflected areduction forState pension support provided totheCity. The
amount recognized by theCity forits proportional share, therelated State proportion, andthe
total were asfollows:
2015
City proportionate share of NPL $ 8,985,893
StateÔs proportionate share ofNPLassociated with the City 2,408,070
TotalNetPension Liability 11,393,963
54
City of Seward, Alaska
Notes toBasic Financial Statements
Thetotal pension liability for theJune 30, 2015 measurement date wasdetermined byan
actuarial valuation asof June 30, 2014 rolled forward toJune 30, 2105 tocalculate thenet
pension liability asof thatdate. TheCityÔs proportion ofthenet pension liability wasbased ona
projection oftheCityÔs long-term share ofcontributions tothepension plan relative tothe
projected contributions ofallparticipating entities, including theState, actuarially determined.
AttheJune 30, 2015 measurement date, theCityÔs proportion was 0.18528 percent, which wasan
increase of0.06863 from itsproportion measured asofJune 30, 2014.
For theyear ended December 31, 2015, theCity recognized pension expense of $2,443,860. Of
this amount, $332,547wasrecorded ason-behalf revenue andexpense foradditional contributions
paid bytheState. AtDecember 31, 2015, theCity reported deferred outflows ofresources and
deferred inflows of resources related to pensions fromthefollowing sources:
Deferred Deferred
Outflows Inflows
ofResources ofResources
Difference between expected and actual experience$10,474$-
Changes in assumptions 525,414-
Netdifference between projected andactualearnings
on pension plan investments -(159,087)
Changes inproportion anddifferences between City
contributions and proportionate share ofcontributions948,496-
Citycontributions subsequent tothe measurement date296,630-
TotalDeferred Outflows andDeferred Inflows Related
toPensions 1,781,014$(159,087)
The $296,630reported asdeferred outflows ofresources related topensions resulting from
contributions subsequent tothemeasurement datewillberecognized asareduction inthenet
pension liability intheyear endedDecember 31, 2016. Otheramounts reported as deferred
outflows ofresources anddeferred inflows ofresources related topensions willberecognized in
pension expense asfollows:
YearEnding December 31,
2016 $1,247,574
2017 32,468
2018 (102,171)
2019 147,426
TotalAmortization 1,325,297
55
City of Seward, Alaska
Notes toBasic Financial Statements
Actuarial Assumptions
Thetotal pension liability wasdetermined by anactuarial valuation asofJune 30, 2014, using the
following actuarial assumptions, applied toallperiods included inthemeasurement period, and
rolled forward tothemeasurement dateofJune 30, 2015. Theactuarial valuation fortheyear
ended June 30, 2014 (latest available) was prepared byBuck Consultants. Theactuarial
assumptions used intheJune 30, 2014 valuation were based ontheresults ofanactuarial
experience study forthe periodfrom July 1, 2005 toJune 30, 2009, resulting inchanges in
actuarial assumptions adopted bytheAlaska Retirement Management Boardtobetter reflect
expected future experience.
Inflation3.12%
SalaryIncreasesGradedbyservice, from9.66% to4.92% forPeace
Officers/Firefighters. Gradedbyageandservice, from8.55% to
4.34% forallothers.
InvestmentReturn / DiscountRate 8.00% netofpensionplaninvestmentexpenses. Thisisbasedonan
averageinflationrateof3.12% andrealrateofreturnover4.88%.
Mortality Ratesbasedonthe1994Group AnnuityMortalityTable, sexdistinct,
1994Baseyearwithoutmarginprojectedto2013usingProjection
ScaleAA, 80% ofthemaletableand60% ofthefemaletableforpre-
terminationmortalityforPeaceofficers/firefighters. 75% formale
and55% forfemaleforpre-terminationforallothers; and100% for
malesand1-yearset-forwardforfemalesforpost-termination.
Thelong-term expected rateof return onpension plan investments wasdetermined usinga
building-block method inwhich best-estimate ranges ofexpected future realrates ofreturn
expected returns, netofpension planinvestment expense andinflation) aredeveloped foreach
major asset class. These ranges arecombined toproduce thelong-term expected rateofreturn by
weighting theexpected future realrates of return bythetargetasset allocation percentage and
byadding expected inflation. The bestestimates ofarithmetic realrates ofreturn foreach major
asset class aresummarized in thefollowing table (note thattherates shown below exclude the
inflation component:
ssetClas Long-termExpected Real Rate ofReturnAs
Domestic equity 5.35%
Global equity (non-US) 5.55%
Private equity 6.25%
Fixed income composite 0.80%
Real estate 3.65%
Alternative equity 4.70%
56
City of Seward, Alaska
Notes toBasic Financial Statements
Discount Rate
Thediscount rateused tomeasure thetotalpension liability was 8.00%. Theprojection ofcash
flows used todetermine thediscount rateassumed thatEmployer andState contributions will
continue tofollow thecurrent funding policy whichmeets State statutes. Based onthose
assumptions, thepension plan'sfiduciary netposition wasprojected to beavailable tomake all
projected futurebenefit payments ofcurrent plan members. Therefore, thelong-term expected
rateofreturn onpension plan investments was applied toallperiods ofprojected benefit
payments todetermine thetotal pension liability.
Discount RateSensitivity
Thefollowing presents theCityÔs proportionate share ofthenetpension liability calculated using
thediscount rateof8.00percent, as well aswhat theCityÔs proportionate shareof thenet
pension liability would beifitwere calculated using adiscount ratethatis1-percentage-point
lower (7.00percent) or 1-percentage-point higher (9.00percent) than thecurrent rate:
Current
1% Decrease Discount Rate 1% Increase
7.00%) (8.00%)(9.00%)
CityÔs proportionate share ofthe
net pension liability $11,945,984$8,985,893$6,493,802
Pension PlanFiduciary NetPosition
Detailed information about thepension planÔs fiduciary netposition isavailable intheseparately
issued PERS financial report.
10. Defined Contribution (DC) Pension Plan
Employees hired afterJuly1, 2006 participate inPERS TierIV, adefinedcontribution plan. ThisPlan
isadministered bytheState ofAlaska, Department ofAdministration inconjunction withthedefined
benefit plan noted above. Benefit andcontribution provisions areestablished byState lawandmay
beamended onlybytheState Legislature. TheAlaska Retirement Management Board mayalso
amend contribution requirements. Included inthePlan are individual pension accounts, retiree
medical insurance planandaseparate HealthReimbursement Arrangement account thatwillhelp
retired members paymedical premiums andother eligible medical expenses notcovered bythe
medical plan. This Plan isincluded inthecomprehensive annual financial report forPERS, andat
the following website, asnoted above. http://doa.alaska.gov/drb/pers.
Contributions totheDC planconsist solely ofemployer andemployee contributions with no
special funding orother nonemployer contributions. Inaddition, actual remittances tothePERS
system require thattheCity contribute at22%. After deducting theDCplan contributions (and
related OPEB contributions), theremaining remittance (theDBUL) isdeposited intotheDBplan as
notedearlier.
57
City of Seward, Alaska
Notes toBasic Financial Statements
Benefit Terms
Employees are immediately vested intheirowncontributions andvest25% withtwo years ofservice,
plusanadditional 25% peryearthereafter forfull vestingatfiveyears of service.
Employee Contribution Rate
Employees are required tocontribute 8.0% oftheirannualcovered salary. Thisamount goesdirectly
totheindividualÔs account.
Employer Contribution Rate
Fortheyearended December 31, 2015, theCitywasrequired tocontribute 5% ofcovered salary into
thePlan.
TheCityand employee contributions toPERS forpensions fortheyearended December 31, 2015
were $104,108 and $166,573, respectively. The Citycontribution amount wasrecognized aspension
expense/expenditures.
11. Other Post-Employment Benefit (OPEB) Plans
Defined Benefit OPEB
Aspartofitsparticipation inthePERS DBPlan (Tiers I, II, III), theCityparticipates intheAlaska
RetireeHealthcare Trust (ARHCT). TheARHCT isself-funded andprovides major medical coverage
to retirees oftheSystem. Benefits vary byTierlevel. ThePlan isadministered bytheState of
Alaska, Department ofAdministration. Employer contribution rates areestablished inconcert
withtheDefined Benefit Pension Plandescribed earlier inthese notes.
Employer Contribution Rate
Forthesixmonths ended June 30, 2015, theCity wasrequired tocontribute 9.46% ofcovered
payroll intotheOPEB plan. That ratechanged to 8.75% ofcovered payroll asofJuly1, 2015.
Employees donotcontribute.
Annual Post-employment Healthcare Cost
Actual contributions intothe Plan forthelastthree years were asfollows. Theamounts reported
hereinclude onlytheemployer required contributions anddonotinclude anyamounts attributed
tothe on-behalf contributions bythe State. On-behalf contributions totheOPEBPlan in2015,
2014, and2013 were $39,797, $161,942and $279,298respectively.
AnnualCity% ofCosts
YearEnded December 31, OPEB CostsContributionsContributed
2015 $371,054$371,054100 %
2014 409,414409,414100 %
2013 473,069473,069100 %
58
City of Seward, Alaska
Notes toBasic Financial Statements
Defined Contribution OPEB
Defined Contribution Pension Planparticipants (PERS TierIV) participate intheOccupational
Death andDisability Plan (ODD), andtheRetiree Medical Plan. Information onthese plans is
included inthecomprehensive annual financial report forthePERS Plan noted above. These plans
provide fordeath, disability, andpost-employment health care benefits.
Employer Contribution Rates
Employees donotcontribute to theDCOPEB plans. Employer contribution rates fortheyear
ended December 31, 2015 were asfollows:
OthePolice/Firer
Tier IVTier IV
Retiree medical plan 1.66% 1.66%
Occupational death and disability benefits0.22% 1.06%
TotalContribution Rates 1.88% 2.72%
In addition, PERS defined contribution members alsoparticipate intheHealth Reimbursement
Arrangement. AS39.30.370establishes thiscontribution amount asÑthree percent oftheaverage
all employees ofallemployersannualemployeecompensationofintheplanÒ. As ofJuly1, 2014,
foractual remittance, thisamount iscalculated as aflatrate foreach fulltime orpart-time
employee perpayperiod and approximates $1,961peryearforeach full-timeemployee, and $1.26
perhour for part-timeemployees.
Annual Postemployment Healthcare Cost
In2015, theCity contributed $123,111inDCOPEB costs. These amounts havebeen recognized as
expense/expenditures.
12. International Brotherhood ofElectrical Workers
Certain Electric Fund employees aremembers oftheInternational Brotherhood ofElectrical
Workers (IBEW), whichmaintains its owndefined contribution pension plan, called the Alaska
Electrical Pension Fund (AEPF) andAlaska Electrical Workers Money Purchase Pension Plan
AEWMPP), pursuant toanagreement between theIBEW andtheAlaska Chapter oftheNational
Electrical Contractors Association, Inc. ThePlan isdefined benefit, multi-employer plan,
administered bythe Alaska Electrical Trust Funds.
AEPT issues apublicly available financial report. Toobtain acopy oftheannual report, please
callor write totheadministrative office:
Alaska Electrical Pension Trust
2600 Denali Street, suite 200
Anchorage, Alaska 99503
The planprovides forretirement, death anddisability, andpost-employment health-carebenefits.
Benefits aregenerally calculated using aformula comprised ofamultiplier times theaverage
monthly salary times number ofyears ofservices. The multiplier isincreased at longevity
milestones formost employees. The cityhassixparticipating employees.
59
City of Seward, Alaska
Notes toBasic Financial Statements
Contributions rates are setthrough acollective bargaining agreement. Thecurrent agreement
became effective from July 1, 2013andexpires June 30, 2016, but willcontinue inforce
thereafter year toyear; provided however, thateither party cangivetheother party written
notice of itsdesire toterminate theagreement ortoeffect changes therein.
Effective July1, 2014, theCitypays intothe AEPFthesumof $5.78foreach compensable hour
earned inamonth byan eligible employee. Effective July1, 2015, therate increased to $6.36.
Themonthly payment foranemployee willnot exceed $1,050foreach month through June 30,
2015 and $1,110foreach month afterJuly1, 2015.
TheCity paysintotheAEWMPP $225.00permonth foreligible employees.
TheCity contributes totheAlaska Electrical Health and Welfare Trust Fund (AEHWTF) forselected
benefits andtheCity contributes $1,811permonth, peremployee beginning July 1, 2014 and
increased to $1,938permonth, peremployee beginning July1, 2015.
There are nofutureminimum contributions andnowithdrawl provisions, provided the required
hourly contributions arecontributed.
Thetotal City contribution forthe yearended December 31, 2015 was $81,964. Employees are
notrequired tocontribute. Thecityhadnorequired contribution payments in arearsat December
31, 2015.
13. Deferred Compensation Plan
TheCityoffers itsemployees avoluntary deferred compensation plan created inaccordance with
Internal Revenue Code Section 457. ThePlan, available to allemployees, permits them to defera
portion oftheir salary untilfuture years. Thedeferred compensation isnotavailable to
employees until termination, retirement, death, orunforeseeable emergency. Theprovisions of
thePlan require thatallassets andincome ofthePlan beheldintrust fortheexclusive benefit of
participants andtheir beneficiaries.
14. RiskManagement
The Cityfaces aconsiderable number ofrisks ofloss, including (a) damage toandlossofproperty
andcontents, (b) employee torts, (c) professional liability; i.e., errors and omissions, (d)
environmental damage, (e) workersÔ compensation; i.e., employee injuries, and (f) medical
insurance costs ofemployees.
TheCity isamember oftheAlaska Municipal League Joint Insurance Association (JIA), a
governmental insurance poolestablished by theAlaska Municipal League. TheJIAprovides the
Citycoverage forproperty, including building andcontents, automobiles, mobile equipment, data
processing equipment andboiler andmachinery; casualty, including general liability, public
officials andemployees liability, law enforcement professional liability, auto liability and
employee benefit liability; workersÔ compensation, including employers liability; andcommercial
blanket bond. TheCity maintains supplemental marine insurance andfirefighters group accident
coverage with insurance companies placed through JIA. TheCity hasnocoverage forpotential
losses from environmental damages.
60
City of Seward, Alaska
Notes toBasic Financial Statements
TheJIAisapublicentity riskpool organized toshare risksamong itsmembers. The AssociationÔs
bylaws provide fortheassessment ofsupplemental contributions from members intheeventthat
losses and expenses forany coverage yearexceed theannual contributions and income earned on
such contributions forthe year. Such supplemental contributions shallbebased oneach
memberÔs deposit contribution incomparison totheaggregate deposit contributions ofall
members. The Association made nosupplemental assessments during theyear ended December
31, 2015.
TheJIAprovides losscontrol services andconducts periodic inspections to ensure safeoperations.
TheCity hasutilized an established safety committee toreview andrecommend safety policies
andprocedures foralldepartments. TheCity Council has committed aportion of theGeneral
Fund balance tomeet potential losses not covered byinsurance andinsurance deductibles.
TheCityalsoparticipates intheAlaska Public Utilities Insurance Trust, which provides insurance
coverage foremployee health benefits. ThePlan isapublicentity riskpoolinwhich risks are
shared among themembers. Stop lossinsurance limits participantsÔ liability forindividual and
aggregate claims.
There was nosignificant reduction inthe CityÔs major categories ofriskinsurance coverage from
theprior year, andtheamount of settlements forthepast three fiscal years didnotmaterially
exceed theCityÔs insurance coverage.
15. Commitments and Contingencies
Amounts received orreceivable from grantor agencies aresubject toaudit andadjustment by
grantor agencies, principally thestate andfederal government. Anydisallowed claims, including
anyamount already collected, could become aliability oftheapplicable funds.
TheCityofSeward istheowner oftheAlaska Sealife Center (ÑCenterÒ), which isoperated onthe
CityÔs behalf bytheSeward Association fortheAdvancement ofMarine Science (ÑSAAMSÒ). The
Cityisobligated toabide byprovisions oftheCooperative Agreement (ÑAgreementÒ) between the
CityandtheState ofAlaskaDepartment ofFishandGame, which served asasignificant funding
source fortheconstruction oftheCenter. The City haspassed most ofits obligations for
operating theCenter ontoSAAMS through amanagement andoperating agreement (ÑOperating
AgreementÒ), buttheCity ultimately remains responsible toensure thatprovisions ofthe
Agreement with theState aremet. TheOperating Agreement requires, inpart, that SAAMS
maintain sufficient termination fund reserves toenable theCity to operate thefacility forupto
onefull yearintheevent SAAMS isunable tomeet its obligations under theOperating Agreement.
Theestimated costsofoperating theCenter forafull year arenoteasilymeasured based on
imprecise definitions oftherequirements, butcould approach $3million peryear. TheOperating
Agreement doesnotrequire SAAMS tomaintain that levelofreserves, andtotheextent their
termination fund reserve levels areinadequate, theCitywould beexpected tocover anyshortfall.
TheCity does notcurrently have adequate reserves initsGeneral Fund tocover thispotential
shortfall.
Various other claims andlawsuits against theCity arepending, butare either covered by
insurance orarethe types which arenormal andreasonable inview oftheCityÔs operations. City
management believes thetotal amount oftheliability, ifany, which may arise from such claims
andlawsuits beyond thatwhich iscovered byinsurance would nothave amaterial effect onthe
CityÔsfinancial condition oritsability tocarry onitsactivities asnow conducted.
61
City of Seward, Alaska
Notes toBasic Financial Statements
16. NewAccounting Pronouncements
The Governmental Accounting Standards Board haspassed several newaccounting standards with
upcoming implementation dates as follows. Management hasnotfully evaluated thepotential
effects ofthese statements, butbelieves thatGASB Statement 75willresult inthe biggest
reporting change. Actualimpacts have notyetbeendetermined:
FairValueMeasurement andApplicationGASB72ÏÏEffective foryear-endDecember 31, 2016 Ï
This statement defines fairvalue anddescribes howfairvalue should bemeasured, what assets
andliabilities should be measured atfairvalue, andwhat information about fairvalue should be
disclosed in thenotes tothefinancial statements. This statement isexpected toprimarily affect
investment disclosures.
Accounting andFinancial Reporting forPensions and RelatedAssets ThatAreNot withinGASB73Ï
theScopeofGASBStatement 68, andAmendments toCertain Provisions ofGASBStatements 67
and68ÏThis statement contains certain clarifications andamendments toGASB 67and68aswell
asestablishing requirements for both defined benefit anddefined contribution pension plansnot
within thescope ofGASB 68. Effective forfiscal year-endDecember 31, 2016Ðexcept those
provisions thataddress employers and governmental nonemployer contributing entities for
pensions thatarenotwithin the scope ofStatement 68, which areeffective forfinancial
statements for year-endDecember 31, 2017, with earlier application encouraged.
Financial Reporting forPostemployment Benefit PlansOther ThanPension PlansGASB74ÏÏ
Effective foryear-endDecember 31, 2017, withearlier application encouraged ÏThis statement
contains financial reporting guidelines forPostemployment Benefit Plans. This isthePlanside
requirements applicable to OPEBbenefits andgenerally brings theOPEB reporting rules into
alignment withthenew GASB67Pension rules.
Accounting andFinancial Reporting for Postemployment Benefits OtherThanPensionsGASB75ÏÏ
Effective foryear-endDecember 31, 2018, withearlier application encouraged ÏThis statement
contains accounting and financial reporting guidelines forOPEB related activities atthe
participating employer level andgenerally brings theOPEB reporting rulesintoalignment withthe
newGASB 68Pension rules.
TheHierarchy ofGenerally Accepted Accounting Principles forStateandLocalGASB76Ï
GovernmentsÏEffective for year-endDecember 31, 2016 ÏThis statement clarifies thehierarchy
ofgenerally accepted accounting principles tobeused inthepreparation ofstate andlocal
government financial statements. Thisstatement supersedes theprevious hierarchy established in
GASB55.
TaxAbatement DisclosuresGASB77ÏÏEffective for year-endDecember 31, 2016ÏThisstatement
requires local governments toprovide financial disclosures relating totax abatements affecting
the government. This includes information aboutabatement agreements entered intodirectly by
thegovernment, including conditions andcriteria under which taxes canbeabated, andthe type
anddollaramount ofthetax. Inaddition, thestatement requires disclosure of taxabatements
issued byothergovernments thataffect thelocalgovernmentÔs revenue recognition and
reporting.
Pensions Provided throughCertain Multiple-Employer Defined Benefit Pension PlansGASB78ÏÏ
Effective foryear-endDecember 31, 2016 ÏThis statement amends thescopeandapplicability of
GASB 68toexclude pensions provided toemployees through acost-sharing multiple-employer
defined benefit pension plan thatis (1) notastate orlocal government pension plan,(2) used to
62
City of Seward, Alaska
Notes toBasic Financial Statements
provide defined benefit pensions toemployees of both government andnon-government
employers, and (3) hasnopredominant state orlocal government employer, either individually or
collectively withother governmental employers providing pensions intheplan.
Certain External Investment PoolsandPoolParticipantsGASB79ÏÏEffective foryear-end
December 31, 2016 ÏThis statement establishes criteria foranexternal investment poolto qualify
formaking theelection tomeasure allofitsinvestments atamortized costforfinancial reporting
purposes.
Blending Requirements forCertain Component UnitsGASB80ÏÏEffective foryear-endDecember
31, 2017, with earlier application encouraged ÏThis statement requires blending ofacomponent
unitincorporated asanot-for-profit corporation inwhich theprimary government isthesole
corporate member. This statement amends the previous requirements established inparagraph 53
ofGASB 14. Thecriterion specified inGASB 80does notapplyto component units included inthe
financial reporting entity pursuant toGASB 39.
Irrevocable Split-Interest AgreementsGASB81ÏÏEffective foryear-end December 31, 2017, with
earlier application encouraged ÏThis statement establishes recording andrecognition criteria for
governments whoreceive resources pursuant toanirrevocable split-interest agreement.
Pension-Issues – anamendment ofGASBStatements No. 67, No. 68, andNo. 73GASB82ÏÏ
Effective foryear-endDecember 31, 2017, withearlier application encouraged ÏThis statement
further amends prior pension reporting toredefine Ñcovered payrollÒ forrequired supplementary
information, clarifies deviations from actuarial standards, andclarifies theclassification of
employer-paid member contributions.
17. Change inAccounting Principle
Asdiscussed inNote 9to thefinancial statements, theCity participates in theAlaska Public
Employees Retirement System (PERS) plan. In2015 theCity adopted theprovisions ofGASB
Accounting andFinancial Reporting forPensionsStatementNo. 68 , which, among other
accounting and reporting criteria, requires the City torecognize itsproportional share oftheNet
Pension Liability (and related deferred inflow/outflow accounts), asof thebeginning of theCityÔs
fiscal year. Asaresult oftheimplementation ofthis statement, theCity hasrecorded anopening
balance adjustment toreflect opening balance pension liabilities andrelated accounts andto
decrease opening netposition asfollows:
OpeningNet Change in
Position, Accounting Opening
asOriginally Principle NetPosition,
PresentedAdjustmentas Restated
Governmental Activities $70,565,890$(4,083,277$ 66,481,772
Business-type Activities 99,791,213(1,721,82698,069,387
Electric Enterprise Fund 24,346,696(810,86923,535,827
Harbor EnterpriseFund 35,156,466(545,47934,610,987
Water Enterprise Fund 5,953,509(194,2975,759,212
Wastewater 5,751,721(171,181 5,580,540
63
Thispageintentionally leftblank.
64
Required Supplementary Information
65
ExhibitE-1
City of Seward, Alaska
Public Employees Retirement System
Schedule of the City's Information on the Net Pension Liability
City's
State ofProportionatePlan Fiduciary
City'sCity'sAlaskaShare of theNet Position as
MeasurementProportionProportionateProportionateNet Pensiona Percentage
YearPeriodof the NetShare of theShare of theTotalCity'sLiability asaof the Total
EndedEndedPensionNet PensionNet PensionNet PensionCoveredPercentage ofPension
LiabilityLiabilityLiabilityLiabilityPayrollPayrollLiabilityDecember31, June 30,
0.18528% 20152015$ 2,408,0708,985,893$ 11,393,963$ 5,021,085$178.96%63.96%
66
Exhibit E-2
City of Seward, Alaska
Public Employees Retirement System
Schedule ofCity Contributions
Contributions
Relative to the
ContractuallyContractuallyContributionCity'sContributions as a
RequiredRequiredDeficiencyCoveredPercentage of
ContributionContribution(Excess)PayrollCovered PayrollYearEndedDecember31,
485,647 485,647 - 5,098,436 9.53% 2015
67
Exhibit E-3
City of Seward, Alaska
International Brotherhood ofElectrical Workers (IBEW)
Schedule ofCity Contributions
Contributions
Relative to the
ContractuallyContractuallyContributionCity'sContributions as a
RequiredRequiredDeficiencyCoveredPercentage of
ContributionContribution(Excess)PayrollCovered PayrollYearEndedDecember31,
201581,964$ 81,964$ -$ 752,587$ 10.89%
201472,669 72,669 - 668,257 10.87%
201388,389 88,389 - 806,727 10.96%
201270,686 70,686 - 719,381 9.83%
201165,956 65,956 - 661,071 9.98%
201059,231 59,231 - 697,056 8.50%
200962,313 62,313 - 649,553 9.59%
200889,252 89,252 - 596,705 14.96%
200775,821 75,821 - 535,907 14.15%
200699,109 99,109 - 580,876 17.06%
68
City of Seward, Alaska
Notes toRequired Supplementary Information
December 31, 2015
1. Public Employees Retirement System
Inaccordance with GASB Statement 82, ÑCovered PayrollÒ isdefined as payroll onwhich
contributions tothe pension plan arebased. Because aportion of theCityÔs contributions tothe
Plan (theDBUL) arebased onDefined Contribution Wages, covered payroll reported hereincludes
allPERSparticipating wages (bothDBand DC).
Both pension tables areintended topresent 10 yearsofinformation. Additional yearÔs
information willbeadded totheschedules as itbecomes available.
Schedule ofCity’sInformation onthe NetPension Liability
This table ispresented basedon thePlan measurement date. ForDecember 31, 2015, the
Plan measurement dateisJune 30, 2015.
There were nochanges inbenefit terms fromthe priormeasurement period.
There were nochanges inassumptions from theprior measurement period.
There wasamaterial change intheallocation methodology from theprior measurement
period. The measurement periodended June 30, 2014 allocated the netpension liability
based onactual contributions for2014. Themeasurement period endedJune 30, 2015
allocated thenetpension liability based onfuture contributions fortheperiod FY2017-
FY2039 asprojected intheJune 30, 2014 valuation report.
Schedule ofCityContributions
This table isbased ontheCityÔs contributions during calendar year 2015. Aportion of
these contributions areincluded intheplan measurement results, while aportion ofthe
contributions arereported asadeferred outflow ontheDecember 31, 2015 basic financial
statements.
2. International Brotherhood of Electrical Workers (IBEW)
Schedule ofCity’sContributions
This table isbased ontheCityÔs contributions basedontheCityÔs fiscal year. All
contributions arerecognized inexpense/expenditures when paid. Thereisnonetpension
liability associated with thisplanatthistime.
69
Thispageintentionally leftblank.
70
Supplementary Information
71
Exhibit F-1
City of Seward, Alaska
NonmajorGovernmental Funds
Combining Balance Sheet
SpecialCapital
RevenueProjectsTotalDecember31, 2015
Assets
Cash and investments8,139$ 2,425,811$ 2,433,950$
Grants receivable617,739 - 617,739
Other receivables709,669 - 709,669
Prepaid items9,676 - 9,676
Total Assets$ 2,425,8111,345,223$ 3,771,034$
Liabilities
Accounts payable23,918$ 33,006$ 56,924$
Accrued payroll and related liabilities38,551 - 38,551
Due to other funds1,158,142 - 1,158,142
Total Liabilities 33,0061,220,611 1,253,617
Fund Balances
Nonspendable - prepaid items9,676 - 9,676
Assigned:
Parks and recreation2,498 - 2,498
Public works4,259 - 4,259
Clinic102,538 - 102,538
General government5,641 - 5,641
Capital projects- 2,392,805 2,392,805
Total Fund Balances 2,392,805124,612 2,517,417
Total Liabilities and Fund Balances$ 2,425,8111,345,223$ 3,771,034$
72
Exhibit F-2
City of Seward, Alaska
NonmajorGovernmental Funds
Combining Statement ofRevenues, Expenditures
andChange inFund Balances
SpecialCapital
Year Ended December 31, 2015RevenueProjectsTotal
Revenues
Intergovernmental1,055,811$ 65,462$ 1,121,273$
Local grants7,500 - 7,500
Othe -75,085 75,085r
65,4621,138,396 1,203,858TotalRevenues
Expenditures
Current:
General government125,700 110,733 236,433
Public works25,260 - 25,260
Parks and recreation8,985 - 8,985
Clinic1,682,532 - 1,682,532
Capita outay: ll
General government- 98,430 98,430
Public safety- 102,656 102,656
Public works- 402,611 402,611
Parks and recreation- 38,595 38,595
753,0251,842,477 2,595,502TotalExpenditures
687,563)(704,081) (1,391,644) Excess of Revenues Over (Under) Expenditures
Other Financing Sources (Uses)
Transfers in501,485 939,994 1,441,479
Transfers out- (301,283) (301,283)
638,711501,485 1,140,196NetOtherFinancingSources (Uses)
48,852)(202,596) (251,448) Net Change in Fund Balances
2,441,657327,208 2,768,865FundBalances, beginning
2,392,805124,612$ 2,517,417$ Fund Balances, ending
73
ExhibitG-1
City of Seward, Alaska
Nonmajor Enterprise Funds
Combining Statement ofNetPosition
December 31, 201WastewateParkingTotal5r
Assets
CurrentAssets
Cash and investments-$ 835,02$ 835,027$7
Receivables:
Accounts -95,630 95,630
Grants -1,534,202 1,534,202
Less allowance for doubtful accounts(4,303) - (4,303)
2,460,556835,021,625,5297TotalCurrentAssets
NoncurrentAssets
Property, plantand equipment, net of
accumulated depreciation7,048,349 63,130 7,111,479
9,572,035898,158,673,8787TotalAssets
51,723 51,723DeferredOutflowsofResources - relatedtopensions
TotalAssetsandDeferred OutflowsofResource$ 898,158,725,601$ 9,623,758$ s7
Liabilities
CurrentLiabilities
Accounts payable4,086$ 447$ 4,533$
Accrued payroll and related liabilities4,133 333 4,466
Due to ther funds62,221 - 62,221
Currentportion:
Accrued annual leave6,423 - 6,423
Notes payable58,986 - 58,986
780135,849 136,629TotalCurrentLiabilities
NoncurrentLiabilities, netofcurrent portion
Accrued annual leave21,948 - 21,948
Notes payable1,304,986 - 1,304,986
264,97Netpensionliability264,9777
7801,727,760 1,728,540TotalLiabilities
4,691 4,691DeferredInflowsofResources - relatedtopensions
NetPosition
63,130 5,747,50Netinvestmentincapitalassets5,684,3777
Unrestricted 834,241,308,773 2,143,0207
7,890,52897,376,993,15077TotalNetPosition
9,623,758$ TotalLiabilities, DeferredInflowsofResourcesandNetPosition$ 898,158,725,601 7
74
Exhibit G-2
City of Seward, Alaska
Nonmajor Enterprise Funds
Combining Statement ofRevenues, Expenses andChange inNetPosition
Year Ended December 31, 2015WastewaterParkingTotal
Operating Revenues - charges for services 318,2231,096,051$ 1,414,274$
Operating Expenses
Salaries and employee benefits380,132 88,891 469,023
Services and supplies326,010 37,533 363,543
Administration156,188 15,861 172,049
Rents and leases- 13,000 13,000
Depreciation235,468 24,477 259,945
179,7621,097,798 1,277,560TotalOperatingExpenses
138,461(1,747) 136,714EarningsfromOperations
Nonoperating Revenues (Expenses)
10,980 10,980Intergovernmental - PERS on-behalf
Investment income (loss)(4,242) 7,816 3,574
Other revenue 239 - 239
Net Nonoperating Revenues (Expenses) 7,8166,977 14,793
Earnings Before Contributions and Transfers 146,2775,230 151,507
Capital contributions1,470,230 - 1,470,230
Transfers in30,826 - 30,826
Transfers out (93,676) (26,377) (120,053)
Change in Net Position 119,9001,412,610 1,532,510
Net Position, beginning, as restated (Note 17) 777,4775,580,540 6,358,017
eoson,enng 897,3776,993,150$ 7,890,527$ NtPitidi
75
Exhibit G-3
City of Seward, Alaska
Nonmajor Enterprise Funds
Combining Statement ofCashFlows
Year Ended December 31, 2015WastewaterParkingTotal
Cash Flows from (for) Operating Activities
Receipts from customers and users1,089,219$ 318,223$ 1,407,442$
Payments to suppliers(329,642) (50,409) (380,051)
Payments to employees(325,630) (88,558) (414,188)
Payments for interfund services used(156,188) (15,861) (172,049)
Net cash flows from operating activities277,759 163,395 441,154
Cash Flows from (for) Noncapital Financing Activities -
Transfers in30,826 - 30,826
Transfers out(93,676) (26,377) (120,053)
Net cash flows for noncapital financing activities(62,850) (26,377) (89,227)
Cash Flows from (for) Capital and Related Financing Activities
Increase in due to other funds62,221 - 62,221
Acquisition of property, plant and equipment(2,865,040) - (2,865,040)
Capital contribution received1,300,000 - 1,300,000
Net cash flows for capital and related financing activities(1,502,819) - (1,502,819)
Cash Flows from (for) Investing Activities
Investment income (loss)(4,242) 7,816 3,574
Net Increase (Decrease) in Cash and Investments 144,834(1,292,152) (1,147,318)
Cash and Investments, beginning1,292,152 690,193 1,982,345
Cash and Investments, ending-$ 835,027$ 835,027$
76
Exhibit G-3, continued
City of Seward, Alaska
Nonmajor Enterprise Funds
Combining Statement ofCashFlows, continued
Year Ended December 31, 2015WastewaterParkingTotal
Reconciliation of Earnings from Operations to Net
Cash from (for) Operating Activities
Earnings from operations(1,747)$ 138,461$ 136,714$
Adjustments to reconcile earnings from operations
to net cash flows from (for) operating activities:
Depreciation235,468 24,477 259,945
10,980 10,980Noncashexpense - PERS on-behalf
Other nonoperating revenue239 - 239
Increase in allowance for doubtful accounts333 - 333
Increase in assets and deferred outflows of resources:
Accounts receivable(7,404) - (7,404)
Deferred outflows of resources related to pensions(43,929) - (43,929)
Increase (decrease) in liabilities and deferred inflows of resources:
Accounts payable(3,632) 124 (3,508)
Accrued payroll and related liabilities(9,702) 333 (9,369)
Accrued annual leave6,460 - 6,460
Net pension liability104,538 - 104,538
Deferred inflows of resources related to pensions(13,845) - (13,845)
Net Cash from Operating Activities$ 163,395277,759$ 441,154$
77
Exhibit H-1
City of Seward, Alaska
Internal Service Funds
Combining Statement ofNet Position
Compensated
MotorAnnual
PoolLeaveTotalDecember31, 2015
Assets
Current Assets
Cash and investments1,227,190$ 505,354$ 1,732,544$
Receivables:
Accrued interest43,952 - 43,952
Interfund loans181,854 - 181,854
505,3541,452,996 1,958,350TotalCurrentAssets
Noncurrent Assets
Interfund loans, net of current portion1,536,090 - 1,536,090
Property, plant and equipment:
Equipment and vehicles6,563,057 - 6,563,057
Less accumulated depreciation(4,444,792) - (4,444,792)
2,118,265 2,118,265Netproperty, plant and equipment in service
3,654,355 3,654,355TotalNoncurrentAssets
Total Assets$ 505,3545,107,351$ 5,612,705$
Liabilities
Current Liabilities
Accrued annual leave - current portion-$ 116,215$ 116,215$
Noncurrent Liabilities, net of current portion
Accrued annual leave- 389,139 389,139
505,354- 505,354TotalLiabilities
Net Position
Net investment in capital assets2,118,265 - 2,118,265
Unrestricted2,989,086 - 2,989,086
Total Net Position -5,107,351 5,107,351
Total Liabilities and Net Position$ 505,3545,107,351$ 5,612,705$
78
Exhibit H-2
City of Seward, Alaska
Internal Service Funds
Combining Statement ofRevenues, Expenses andChange inNetPosition
Compensated
MotorAnnual
Year Ended December 31, 2015PoolLeaveTotal
Operating Revenues
Vehicle rental and interfund charges$ 473,650470,439$ 944,089$
Operating Expenses
Salaries and employee benefits- 473,650 473,650
Supplies and maintenance3,900 - 3,900
Depreciation434,783 - 434,783
473,650438,683 912,333TotalOperatingExpenses
31,756 31,756EarningsfromOperations
Nonoperating Revenues
Investment income 46,920 - 46,920
Earnings Before Transfers -78,676 78,676
Transfers in147,012 - 147,012
Change in Net Position -225,688 225,688
Net Position, beginning 4,881,663 4,881,663
eoson,enng 5,107,351$ 5,107,351$ NtPitidi
79
Exhibit H-3
City of Seward, Alaska
Internal Service Funds
Combining Statement ofCashFlows
Compensated
MotorAnnual
Year Ended December 31, 2015PoolLeaveTotal
Cash Flows from (for) Operating Activities
Receipts from vehicle rentals and interfund charges470,439$ 473,650$ 944,089$
Payments to suppliers(3,900) - (3,900)
Payments to employees- (443,366) (443,366)
Net cash flows from operating activities466,539 30,284 496,823
Cash Flows from Noncapital Financing Activities
Transfers in147,012 - 147,012
Cash Flows for Capital and Related Financing Activities
Acquisition of equipment and vehicles(400,189) - (400,189)
Cash Flows from Investing Activities
Interfund loan receipts226,613 - 226,613
Investment income received51,165 - 51,165
Net cash flows from investing activities277,778 - 277,778
30,284491,140 521,424NetIncreaseinCashandInvestments
475,070736,050 1,211,120CashandInvestments, beginning
505,3541,227,190$ 1,732,544$ Cash and Investments, ending
Reconciliation of Earnings from Operations to Net
Cash from Operating Activities
Earnings from operations 31,756$ 31,756$
Adjustments to reconcile earnings from operations
to net cash flows from operating activities:
Depreciation434,783 - 434,783
Increase in liabilities - accrued annual leave- 30,284 30,284
Net Cash from Operating Activities$ 30,284466,539$ 496,823$
80
General Fund
The General Fundisestablished toaccount fortherevenues andexpenditures necessary tocarry
outbasic governmental activities ofthe Citysuch asfireandpolice protection, public works,
recreation, planning, administrative services, etc. Appropriations aremadefrom theGeneral
Fund annually.
Revenue isrecorded bysource, i.e., taxes, charges forservices, intergovernmental. Expenditures
arerecorded firstbyfunction thenbyactivity andobject of expenditures.
81
Exhibit I-1
City of Seward, Alaska
General Fund
Balance Sheet
December 31,20152014
Assets
Cash and investments5,889,694$ 5,804,899$
Receivables
Taxes:
10,8786,056Personalproperty
Less allowance for doubtful accounts(660) (342)
10,5365,396Netpersonalproperty
Motor vehicle 3,0144,973
Hotel/motel room393 12,173
19,1135,323Realproperty
Sales 496,715473,097
Net taxes 541,551489,182
Accounts 61,832210,666
Grants and shared revenues8,711 1,101
Accrued interest63,022 54,789
Total Receivables 659,273771,581
Prepaid items 341,995591,597
Inventory 9,0508,711
Due from other funds1,406,131 1,532,519
Total Assets$ 8,347,7368,667,714$
82
Exhibit I-1, continued
City of Seward, Alaska
General Fund
Balance Sheet, continued
December 31,20152014
Liabilities
Accounts payable366,742$ 267,588$
Accrued payroll and related liabilities347,694 477,893
Accrued liabilities33,078 27,431
Deposits 95,98299,069
Unearned revenue30,760 15,478
884,372877,343TotalLiabilities
Deferred Inflows of Resources
Delinquent property taxes20,663 14,965
Total Liabilities and Deferred Inflows of Resources 899,337898,006
Fund Balance
Nonspendable:
Inventory 9,0508,711
Prepaid items 341,995591,597
Committed:
Working capital1,500,000 1,500,000
Insurance 126,418126,418
Hospital line of credit500,000 500,000
Assigned
Insurance 171,966224,465
Other assigments100,000 100,000
Unassigned 4,698,9704,718,517
Total Fund Balance 7,448,3997,769,708
Total Liabilities, Deferred Inflows of Resources, and Fund Balance$ 8,347,7368,667,714$
83
Exhibit I-2
City of Seward, Alaska
General Fund
Schedule ofRevenues, Expenditures and
Change inFund Balance - Budget andActual
Year Ended December 31,20142015
BudgetVarianceActualActual
Revenues
Taxes:
Sales4,909,151$ 4,883,996$ (25,155)$ 4,535,707$
1,003,6651,038,000 (34,335) 986,449Property
Hotel/motel room388,850 458,605 69,755 421,981
Payments in lieu of taxes74,000 88,331 14,331 82,490
Penalty and interest1,600 4,007 2,407 1,005
Total taxes6,411,601 6,438,604 27,003 6,027,632
Licenses and permits:
Building permits50,000 97,588 47,588 67,514
Taxi permits1,000 1,277 277 1,050
Department of Motor Vehicles commissions89,000 86,957 (2,043) 93,526
Animal control licenses350 280 (70) 260
Business licenses21,000 18,460 (2,540) 19,890
Miscellaneous2,000 1,803 (197) 3,685
Total licenses and permits163,350 206,365 43,015 185,925
Intergovernmental:
Jail contract295,203 519,887 224,684 663,146
Dispatch contracts86,640 95,290 8,650 99,140
Raw fish tax520,000 334,691 (185,309) 482,543
Shared fisheries and landing tax- 17,356 17,356 18,247
Liquor tax22,000 19,350 (2,650) 16,700
Library grants- 19,358 19,358 25,266
Revenue sharing250,000 216,994 (33,006) 214,826
983,049983,049 - 951,816PERSrelief
Other grants46,640 74,086 27,446 139,534
Total intergovernmental2,203,532 2,280,061 76,529 2,611,218
84
Exhibit I-2, continued
City of Sewar, Aasadlk
GeneralFund
ScheduleofRevenues, Expendituresand ChangeinFundBalance -
BudgetandActual, continued
2015YearEndedDecember31,2014
BudgetActualVarianceActual
Revenues, continued:
Charges forservices:
1,776,2941,776,560$ Administrative$ 1,794,787(266)$
155,688152,800Rentsandleases 143,2602,888
10,7439,000Copyingcharges 8,2451,743
2,994- Work orders 1,6982,994
778,350630,550Recreation 663,298147,800
33,76232,500Library 39,7071,262
Total charges for services2,601,410 2,757,831 156,421 2,650,995
17,99310,000Finesandbails 14,0737,993
78,71653,000Investmentincome 80,65825,716
Other:
1,8542,000Saleofland, equipment and gravel 540(146)
17,43015,000Refusecontract 18,1452,430
52,591- Insurance recovery 83,27652,591
53,93723,400Other 22,91230,537
124,873Totalother40,400 125,812 85,412
Total Revenues 11,905,38211,483,293 422,089 11,695,374
Expenditures
General government:
Mayor and council:
49,31437,393Salaries 44,811(11,921)
21,57821,960Employeebenefits 18,905382
99,78595,000Audit 72,283(4,785)
98,611130,000Legal 101,43231,389
9,5797,100Purchasedservices 5,590(2,479)
11,13612,496Suppliesandmaintenance 10,9431,360
176,517176,700Legislativerepresentation 183,575183
47,53870,104Generalandadministrative 52,48722,566
Total mayor and council550,753 514,058 36,695 490,026
85
Exhibit I-2, continued
City of Sewar, Aasadlk
GeneralFund
ScheduleofRevenues, Expendituresand ChangeinFundBalance -
BudgetandActual, continued
2015YearEndedDecember31,2014
BudgetActualVarianceActual
Expenditures, continued:
General government, continued:
City manager:
190,657188,991$ Salaries$ 230,342(1,666)$
110,989105,906Employeebenefits 150,555(5,083)
19,34617,585Purchasedservices 20,659(1,761)
14,9958,900Suppliesandmaintenance 8,115(6,095)
42,33531,150Generalandadministrative 41,724(11,185)
Total city manager352,532 378,322 (25,790) 451,395
City clerk:
135,737155,343Salaries 144,35619,606
107,974117,065Employeebenefits 110,7779,091
5,11212,000Purchasedservices 10,0046,888
939- Supplies and maintenance 130(939)
14,17418,200Generalandadministrative 17,1784,026
Total city clerk302,608 263,936 38,672 282,445
Management information systems:
180,654158,600Salaries 153,813(22,054)
91,87096,493Employeebenefits 90,6554,623
8,50713,400 7,3424,893Purchasedservices
29,26836,000Suppliesandmaintenance 35,0826,732
2,3849,000Generalandadministrative 6,1246,616
Total management information
systems313,493 312,683 810 293,016
Finance:
465,307580,704Salaries 396,369115,397
275,821340,400Employeebenefits 244,05964,579
22,24027,300Purchasedservices 17,4525,060
69,48454,000Suppliesandmaintenance 58,702(15,484)
23,99423,000Generalandadministrative 25,914(994)
3,000Capitaloutlay 2,6663,000
Total finance1,028,404 856,846 171,558 745,162
86
Exhibit I-2, continued
City of Sewar, Aasadlk
GeneralFund
ScheduleofRevenues, Expendituresand ChangeinFundBalance -
BudgetandActual, continued
2015YearEndedDecember31,2014
BudgetActualVarianceActual
Expenditures, continued:
General government, continued:
Community development:
143,863150,023$ Salaries$ 119,5026,160$
84,20187,829Employeebenefits 80,5003,628
59,49161,200Purchasedservices 41,0531,709
3,1357,700Suppliesandmaintenance 7,9124,565
3,58310,100Generalandadministrative 13,2526,517
4,000Capitaloutlay -4,000
Total community development320,852 294,273 26,579 262,219
General services:
96,14979,150Purchasedservices 49,582(16,999)
17,36521,700Suppliesandmaintenance 50,0584,335
5,77927,200Generalandadministrative 38,67421,421
Total general services128,050 119,293 8,757 138,314
Contributions toorganizations:
75,00075,000SeniorCitizens 75,000-
204,128204,128ChamberofCommerce 190,000-
25,00025,000BoysandGirlsClub 25,000-
304,128 - 290,000Totalcontributionstoorganizations304,128
Total general government3,300,820 3,043,539 257,281 2,952,577
Public safety:
Police:
994,3921,051,835Salaries 969,75357,443
652,300741,239Employeebenefits 700,27488,939
132,161124,600Purchasedservices 120,307(7,561)
52,26058,740Suppliesandmaintenance 56,1876,480
34,59338,700Generalandadministrative 40,8594,107
Total police2,015,114 1,865,706 149,408 1,887,380
87
Exhibit I-2, continued
City of Sewar, Aasadlk
GeneralFund
ScheduleofRevenues, Expendituresand ChangeinFundBalance -
BudgetandActual, continued
2015YearEndedDecember31,2014
BudgetActualVarianceActual
Expenditures, continued:
Public safety, continued:
Jail:
272,115310,209$ Salaries$ 272,81938,094$
201,849242,655Employeebenefits 234,42540,806
60,58058,000Purchasedservices 61,181(2,580)
19,33625,050Suppliesandmaintenance 24,7115,714
91,54993,207Generalandadministrative 88,9891,658
Total jail729,121 645,429 83,692 682,125
Animal control:
61,33657,871Salaries 46,457(3,465)
38,91538,101Employeebenefits 34,671(814)
10,1546,800Purchasedservices 13,309(3,354)
4,82515,594Suppliesandmaintenance 16,93610,769
2,7243,100Generalandadministrative 3,094376
Total animal control121,466 117,954 3,512 114,467
Fire:
173,687194,659Salaries 162,39420,972
115,991135,096Employeebenefits 128,74019,105
198,091210,080 176,78311,989Purchasedservices
33,12140,900Suppliesandmaintenance 41,3647,779
10,34210,200Generalandadministrative 9,904(142)
5,566- Capital outlay -(5,566)
Total fire590,935 536,798 54,137 519,185
Volunteer training:
2,74610,000Employeebenefits 8,2637,254
1,1915,000Purchasedservices 3,7863,809
21,11323,170Suppliesandmaintenance 40,0772,057
24,60028,000Generalandadministrative 41,1563,400
Total volunteer training66,170 49,650 16,520 93,282
Emergency preparedness:
4,0577,750Purchasedservices 2,7173,693
2,0342,500Suppliesandmaintenance 960466
3,500Generalandadministrative 9843,500
Total emergency preparedness13,750 6,091 7,659 4,661
88
Exhibit I-2, continued
City of Sewar, Aasadlk
GeneralFund
ScheduleofRevenues, Expendituresand ChangeinFundBalance -
BudgetandActual, continued
2015YearEndedDecember31,2014
BudgetActualVarianceActual
Expenditures, continued:
Public safety, continued:
Building inspection:
73,45572,528$ Salaries$ 72,838(927)$
47,54251,034Employeebenefits 48,7713,492
9,47110,250Purchasedservices 10,892779
3,5685,000Suppliesandmaintenance 4,2841,432
1,7675,300Generalandadministrative 1,3713,533
Total building inspection144,112 135,803 8,309 138,156
Engineering:
7,01922,384Salaries 5,05115,365
6,49114,947Employeebenefits 4,8468,456
336- Purchased services 51(336)
5403,000Suppliesandmaintenance 5,7842,460
69- General andadministrative 45(69)
Total engineering40,331 14,455 25,876 15,777
Total public safety3,720,999 3,371,886 349,113 3,455,033
Public works:
Roads and streets:
199,719235,061Salaries 212,18835,342
126,848150,878 142,96524,030Employeebenefits
286,438257,325Purchasedservices 298,445(29,113)
139,334216,900Suppliesandmaintenance 185,49177,566
16,6479,350Generalandadministrative 3,798(7,297)
Total roads and streets869,514 768,986 100,528 842,887
City shop:
137,505132,639Salaries 118,767(4,866)
92,253112,534Employeebenefits 107,41520,281
68,50194,650Purchasedservices 70,31426,149
93,14156,325Suppliesandmaintenance 85,576(36,816)
4,8445,725Generalandadministrative 1,011881
Total city shop401,873 396,244 5,629 383,083
Municipal building:
80,23281,939Salaries 71,3381,707
69,27174,364Employeebenefits 76,4275,093
166,704243,075Purchasedservices 158,03176,371
16,86039,250Suppliesandmaintenance 32,79522,390
750Generalandadministrative 27750
Capital outlay 9,800-
Total municipal building439,378 333,067 106,311 348,418
Total public works1,710,765 1,498,297 212,468 1,574,388
89
Exhibit I-2, continued
City of Sewar, Aasadlk
GeneralFund
ScheduleofRevenues, Expendituresand ChangeinFundBalance -
BudgetandActual, continued
2015YearEndedDecember31,2014
BudgetActualVarianceActual
Expenditures, continued:
Parks and recreation:
570,415593,766$ Salaries$ 573,28423,351$
287,972328,118Employeebenefits 298,37840,146
345,969274,580Purchasedservices 289,401(71,389)
135,654104,220Suppliesandmaintenance 144,744(31,434)
25,39836,230Generalandadministrative 31,56410,832
2,000Capitaloutlay -2,000
Total parks and recreation1,338,914 1,365,408 (26,494) 1,337,371
Library:
181,734194,054Salaries 181,97612,320
122,350142,366Employeebenefits 129,46720,016
170,724175,000Purchasedservices 174,2984,276
64,65952,391Suppliesandmaintenance 54,505(12,268)
13,80516,195Generalandadministrative 19,4062,390
Total library580,006 553,272 26,734 559,652
Debt service:
90,000200,784Principalpayments 85,000110,784
1,401,1651,456,298 1,373,27155,133Retirementbenefits
155,150155,150Interestandothercosts 159,400-
Total debt service1,812,232 1,646,315 165,917 1,617,671
Total Expenditures 11,478,71712,463,736 985,019 11,496,692
Excess ofRevenues Over (Under) Expenditures 426,665(980,443) 1,407,108 198,682
Other Financing Sources (Uses)
1,980,2801,972,148Transfersin 1,955,5758,132
2,085,636)(2,187,808) Transfers out (3,382,952)102,172
Net Other Financing Sources (Uses) (105,356)(215,660) 110,304 (1,427,377)
Net Change inFund Balance$ 321,309(1,196,103) 1,517,412$ (1,228,695)
Fund Balance, beginning7,448,399 8,677,094
Fund Balance, ending$ 7,448,3997,769,708$
90
SpecialRevenue Funds
Special Revenue Funds areused toaccount forexpenditures associated with dedicated orrestricted
revenue sources.
Two Lakes Park ÏTo account foracquisition ofland, survey anddevelopment ofthepark area,
including sitepreparation, picnic tables, andother improvements.
LitterControl (ALPAR) ÏTo account forthe costofaCityÏadministered litter control program.
Theprogram employs local youth andisfinanced by grants from thenon-profit Alaskans forLitter
Prevention and Recycling andtheKenai Peninsula Borough.
SCHCÏToaccount forthecosts ofrunning acommunity health center.
BusTransportation Grant ÏTo account forcitybussing transportation.
Natural Disasters ÏToaccount forthe costs associated withflooding andother natural events.
91
Exhibit J-1
City ofSeward, Alaska
Nonmajor Special RevenueFunds
CombiningBalance Sheet
Parks andGeneral
RecreationClinicGovernmentPublic Works
TwoBus
LakesTransportationNatural
December 31, 2015ParkSCHCGrantDisastersTotal
Assets
Cash and investments2,498$ -$ 5,641$ -$ 8,139$
Grants receivable- 150,685 - 467,054 617,739
Other receivables- 709,669 - - 709,669
Prepaid items- 9,676 - - 9,676
Total Assets$ 870,0302,498$ 5,641$ 467,054$ 1,345,223$
Liabilities
Accounts payable-$ 23,918$ -$ -$ 23,918$
s 38,551- - - 38,551Accruedpayrollandrelatedliabilitie
Due to other funds- 695,347 - 462,795 1,158,142
757,816- - 462,795 1,220,611TotalLiabilities
Fund Balances
Nonspendable - prepaid items- 9,676 - - 9,676
Assigned:
Parks and recreation2,498 - - - 2,498
Public works- - - 4,259 4,259
Clinic- 102,538 - - 102,538
General government- - 5,641 - 5,641
Total Fund Balances 112,2142,498 5,641 4,259 124,612
Total Liabilities and Fund Balances$ 870,0302,498$ 5,641$ 467,054$ 1,345,223$
92
Exhibit J-2
City of Seward, Alaska
Nonmajor Special Revenue Funds
Combining Statement of Revenues, Expenditures
and Change in Fund Balances
General
Parks and RecreationClinicGovernmentPublic Works
TwoBus
LakesLitterTransportationNatural
ParControlSCHCGrantDisastersTotalYearEndedDecember31, 2015k
Revenues
Intergovernmental-$ -$ 1,026,292$-$ 29,519$ 1,055,811$
Local grants- 7,500 - - - 7,500
Other- - 75,085 - - 75,085
7,500- 1,101,377 - 29,519 1,138,396TotalRevenues
Expenditures
Salaries and employee benefits- 8,508 1,091,228 - 5,209 1,104,945
Contracted services- - 227,056 125,700 - 352,756
Supplies- 40 208,493 - 17,559 226,092
General and administrative- - 65,654 - - 65,654
Miscellaneous- 437 90,101 - 2,492 93,030
8,985- 1,682,532 125,700 25,260 1,842,477TotalExpenditures
Excess of Revenues Over
1,485)- (581,155) (125,700) 4,259 (704,081) Under) Expenditures
Other Financing Sources
Transfers in- 1,485 500,000 - - 501,485
Net Change in Fund Balances -- (81,155) (125,700) 4,259 (202,596)
2,498 193,369 131,341 - 327,208FundBalances, beginning
2,498$ 112,214$ 5,641$ 4,259$ 124,612$ Fund Balances, ending
93
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94
CapitalProjectFunds
Capital Project Funds areestablished toaccount fortheresources expended toacquire orconstruct
assets ofarelatively permanent nature.
FireDepartment Equipment ÏToaccount forthepurchase offiredepartment equipment.
FireSimulator ÏToaccount forthepurchase ofthefiredepartment simulator.
Kawabe ParkÏToaccount forallactivities relatedtoKawabe Parkcapital costs.
Streets andSidewalks ÏToaccount for allactivities related tostreet andsidewalk capital costs.
Capital Acquisition ÏToaccount forpurchase ofequipment not financed bytheMotor Pool Fund
andcapital improvements andprojects ofatleast $20,000.
95
Exhibit K-1
CityofSeward, Alaska
Nonmajor Capital Project Funds
Combining Balance Sheet
Public SafetyGeneralGovernment
Fire KawabeStreetsandCapital
December 31, 2015SimulatorParkSidewalksAcquisitionTotal
Assets
Cashand investments3,000$ 5,929$ 300,000$ 2,116,882$ 2,425,811$
Liabilities
Account payable-$ -$ -$ 33,006$ 33,006$
FundBalances
Assigned - capital projects3,000 5,929 300,000 2,083,876 2,392,805
TotalLiabilitiesand FundBalances$ 5,9293,000$ 300,000$ 2,116,882$ 2,425,811$
96
Exhibit K-2
Cityof Seward, Alaska
Nonmajor Capital Project Funds
Combining Statement of Revenues, Expenditures
and Change in Fund Balances
Public SafetyGeneral Government
Fire
DepartmentFire KawabeStreets andCapital
Year Ended December 31, 201EquipmentSimulatoParkSidewalksAcquisitionTotal5r
Revenues
Intergovernmental65,462$ -$ -$ -$ -$ 65,462$
Expenditures
Contracted services- - - - 73,735 73,735
Supplies and maintenance- - - - 36,044 36,044
General and administrative- - - - 945 945
Capital outla -65,462 - - 576,830 642,292y
Other services and charges- - - - 9 9
Total Expenditures -65,462 - - 687,563 753,025
Excess of Revenues Over
Under) Expenditure -- - - (687,563) (687,563) s
Other Financing Sources (Uses)
Transfers in- 3,000 - 300,000 636,994 939,994
Transfers out(1,283) - - - (300,000) (301,283)
Net Other Financing Sources (Uses) 3,000(1,283) - 300,000 336,994 638,711
Net Change in Fund Balances 3,000(1,283) - 300,000 (350,569) (48,852)
1,283 5,929 - 2,434,445 2,441,657FundBalances, beginning
3,000-$ 5,929$ 300,000$ 2,083,876$ 2,392,805$ Fund Balances, ending
97
Thispageintentionally leftblank.
98
Enterprise Funds
Enterprise Funds areestablished toaccount forthefinancing of self-supporting activities of
governmental units, which render services tothegeneral public onauser-charge basis. Enterprise
Funds aremaintained onthe accrual basis ofaccounting.
Electric ÏToaccount forthe provision ofelectrical service tothe residents ofthe Cityand
other areas within theelectric service area.
Water ÏToaccount for theprovision ofwater services tothe residents of theCity.
Wastewater ÏToaccount forthe provision ofsewer services totheresidents oftheCity.
Harbor ÏToaccount fortheprovision of harborandmarine services tothepublic within the
Small Boat Harbor basin.
Seward Marine Industrial Center (SMIC) ÏToaccount fortheprovision ofmarine-related
services tothepublic ontheeastsideofResurrection Bay.
Parking ÏToaccount fortheprovision ofpublic parking services.
Healthcare Facilities - Toaccount for theprovision ofservices provided by Seward Community
Health Center, Providence Seward Medical andCare Center (PSMCC) andlong-termcare
facilities.
99
Exhibit L-1
City of Seward, Alaska
Electric Enterprise Fund
Statement of Net Position
20152014December31,
Assets
Current Assets
Cash and investments4,507,017$ 3,129,380$
Receivables:
Accounts 959,0021,000,085
Interfund loan, current portion20,578 19,552
Grants 466,6071,037,210
Interest 16,61415,550
Other 19,1989,640
Less allowance for doubtful accounts(45,004) (43,155)
Net receivables 1,437,8182,038,059
Prepaid expenses 5,5693,600
Inventory 920,239978,626
Total Current Assets 5,493,0067,527,302
Restricted Cash andInvestments
Bond retirement 677,911396,036
Capital projects 1,799,2201,556,669
Total Restricted Cash and Investments 2,477,1311,952,705
Assessments Receivable, net of current portion- 1,851
Interfund Loan, net of current portion275,617 296,195
Property, Plant andEquipment
Land and land rights 230,951230,951
Buildings 9,578,1699,578,169
Improvements other than buildings40,510,321 40,168,506
Equipment 7,524,9127,612,418
Total property, plant and equipment inservice57,931,859 57,502,538
Less accumulated depreciation(38,876,118) (37,151,823)
Net property, plant and equipment inservice19,055,741 20,350,715
Construction in progress5,622,906 2,241,949
Total Property, Plant and Equipment 22,592,66424,678,647
Total Assets 30,860,84734,434,271
Deferred Outflows of Resources
Related topensions -245,004
Unamortized deferred loss on refunding- 4,904
Total Deferred Outflows ofResources 4,904245,004
Total Assets and Deferred Outflows ofResources$ 30,865,75134,679,275$
100
Exhibit L-1, continued
City of Seward, Alaska
Electric Enterprise Fund
Statement ofNetPosition, continued
December 31,20152014
Liabilities
Current Liabilities
Accounts payable736,850$ 487,954$
Accrued payroll and related liabilities21,362 64,819
Accrued interest 21,991 23,553
Current portion:
Accrued annual leave 24,323 17,700
Bonds payable130,000 400,000
Customer deposits254,239 212,634
1,206,6601,188,765TotalCurrentLiabilities
Noncurrent Liabilities, net of current portion
Accrued annual leave31,725 33,975
Bonds payable5,115,000 5,245,000
Unamortized bond premium25,054 33,420
Net pension liability1,255,168 -
5,312,3956,426,947TotalNoncurrentLiabilities
6,519,0557,615,712TotalLiabilities
22,222DeferredInflowsofResources - related to pensions
Net Position
Net investment in capital assets19,804,629 17,597,059
Unrestricted7,236,712 6,749,637
24,346,69627,041,341TotalNetPosition
Total Liabilities, Deferred Inflows of Resources and Net Position$ 30,865,75134,679,275$
101
Exhibit L-2
CityofSeward, Alaska
Electric Enterprise Fund
Statement of Revenues, Expenses
and Change in Net Position
YearEndedDecember31,20152014
OperatingRevenues
Residential3,209,933$ 3,233,812$
Small general service1,790,509 1,800,254
Largegeneralservic 4,575,3434,493,965e
Industrial 1,028,6691,047,653
Harbor power 300,446358,887
74,22272,97Streetandyardlights7
Miscellaneous297,056 84,299
11,097,04511,270,980TotalOperatingRevenues
OperatingExpenses
Power 5,091,2425,151,274
Distribution 253,84308,0290
Administrationandgeneral 2,728,9152,879,521
Depreciation1,724,295 1,737,127
9,811,1210,063,1194TotalOperatingExpenses
1,285,9211,207,861EarningsfromOperations
NonoperatingRevenues (Expenses)
Intergovernmental - PERSon-behalf 174,27652,010
Investmentincome 139,15192,1510
Salarycredits - workorders 208,13100,5770
Supplycredits - workorders 127,829110,520
Interest expense(271,699) (286,592)
Other expenses(276,637) (216,788)
NetNonoperatingRevenues (Expenses) 146,005(93,078)
EarningsBeforeContributionsandTransfers 1,431,9261,114,783
Capitalcontributions 1,055,4623,518,402
110,7844Transfersin110,78
Transfers out(1,238,455) (1,230,097)
ChangeinNetPosition 1,368,0753,505,514
Net Position, beginning, asrestated (Note17) 22,978,621723,535,82
24,346,69627,041,341$ Net Position, ending
102
Exhibit L-3
City of Seward, Alaska
Electric Enterprise Fund
Statement ofCash Flows
Year Ended December 31,20152014
Cash Flows from (for) Operating Activities
Receipts from customers and users11,282,909$ 10,988,797$
Payments to suppliers(6,075,150) (6,152,133)
Payments to employees(1,202,996) (1,005,682)
Payments for interfund services used(869,585) (863,637)
Net cash flows from operating activities3,135,178 2,967,345
Cash Flows from (for) Noncapital Financing Activities
Transfers in110,784 110,784
Transfers out(1,238,455) (1,230,097)
Net cash flows for noncapital financing activities(1,127,671) (1,119,313)
Cash Flows from (for) Capital and Related Financing Activities
Principal payments on bonds payable(400,000) (380,000)
Interest payments on bonds payable(276,722) (291,536)
Acquisition of property, plant and equipment(3,639,991) (1,160,342)
Capital contributions received2,949,650 1,275,502
Net cash flows for capital and related financing activities(1,367,063) (556,376)
Cash Flows from Investing Activities
Investment income received193,215 140,124
Interfund loan receipts 19,552 18,576
Net cash flows from investing activities212,767 158,700
1,450,356853,211NetIncreaseinCashandInvestments
4,156,1555,606,511CashandInvestments, beginning
5,606,5116,459,722$ Cash and Investments, ending
Reconciliation of Cash and Investments to Statement of Net Position
Current assets4,507,017$ 3,129,380$
Restricted assets1,952,705 2,477,131
Total Cash and Investments$ 5,606,5116,459,722$
103
Exhibit L-3, continued
City of Seward, Alaska
Electric Enterprise Fund
Statement ofCash Flows, continued
Year Ended December 31,20152014
Reconciliation of Earnings from Operations to Net
Cash from (for) Operating Activities
Earnings from operations1,207,861$ 1,285,921$
Adjustments to reconcile earnings from operations to net
cash flows from (for) operating activities:
Depreciation1,724,295 1,737,127
Other nonoperating expenses(276,637) (216,788)
Other nonoperating revenue - workorder reimbursements:
Salaries100,577 208,130
Supplies110,520 127,829
Noncash expense - PERS on-behalf 174,27652,010
Increase in allowance for doubtful accounts1,849 4,459
Increase) decrease in assets and deferred outflows of resources:
Receivables(31,525) (90,488)
Prepaid expenses1,969 (5,569)
Inventory(58,387) (46,735)
Deferred outflows of resources - related to pensions(208,087) -
Increase (decrease) in liabilities and deferred inflows of resources:
Accounts payable78,608 (172,612)
Accrued payroll and related liabilities(43,457) 25,281
Accrued annual leave4,373 (41,267)
Customer deposits41,605 (22,219)
Net pension liability495,186 -
Deferred inflows of resources related to pensions(65,582) -
Net Cash from Operating Activities$ 2,967,3453,135,178$
Noncash Capital and Related Financing Activities
Purchase of capital assets included in accounts payable271,329$ 101,041$
104
Exhibit L-4
City of Seward, Alaska
Electric Enterprise Fund
Schedule ofOperating Expenses
Year Ended December 31,20152014
Power
Salaries and employee benefits94,781$ 135,999$
Purchased services227,562 91,764
Power for resale4,778,090 4,857,231
6,24850,841Supplies, maintenance and other
Total Power 5,091,2425,151,274
Distribution
Salaries and employee benefits216,683 166,646
Purchased services86,436 78,287
Supplies and maintenance3,883 9,507
Administration and general1,027 (600)
Total Distribution 253,840308,029
Administration and General
Salaries and employee benefits1,226,552 1,069,457
Purchased services227,230 220,956
Supplies and maintenance194,867 132,050
Administrative fee868,558 864,237
442,215362,314Other
Total Administration and General 2,728,9152,879,521
Depreciation 1,737,1271,724,295
Total Operating Expenses$ 9,811,12410,063,119$
105
Exhibit L-5
City of Seward, Alaska
Electric Enterprise Fund
Schedule ofComposition of NetPosition
December 31,20152014
Grants and other external contributions34,257,767$ 30,739,365$
Related accumulated amortization(20,857,305) (17,994,404)
City-generated equity and transfers from other funds13,640,879 11,601,735
Total Net Position$ 24,346,69627,041,341$
106
Exhibit L-6
City of Seward, Alaska
Electric Enterprise Fund
Schedule ofElectric Capital Projects
Standby
ElectricCustomer
Year Ended December 31, 2015GenerationProjects
Funding Sources
State grants$ -906,907$
Electric fund customers 137,445-
Electric funds -9,028
137,445915,935TotalFundingSources
137,445915,935$ Capital Outlay
107
Exhibit L-7
City of Seward, Alaska
WaterEnterpriseFund
StatementofNetPosition
December 31,20152014
Assets
Current Assets
Cash and investment$ 1,050,021,034,762$ s7
Receivables:
Accounts 156,67174,7774
Assessments 3,534-
Grants and loans -1,054,071
Othe 196750r
Less allowance for doubtful account (7,050)(7,851) s
Net receivable 153,351,221,74s74
Inventor 93,30094,291y
1,296,6812,350,800TotalCurrentAssets
Restricted Cash and Investment - capital project 1,906,758943,636ss
Property, Plant and Equipment
100,42100,42Landandlandrights00
Buildings 1,287,8531,287,853
6,203,9116,203,911Improvementsotherthanbuildings
Equipment 1,308,671,312,085 0
8,900,858,904,269 4Totalproperty, plant and equipment in service
4,724,014)(4,923,659) Less accumulated depreciation
4,176,843,980,61Netproperty, plant and equipment in service00
466,454,781,313Constructioninprogress7
4,643,298,761,923 7TotalProperty, Plant and Equipment
7,846,73612,056,359TotalAssets
58,707DeferredOutflowsofResources - related to pensions
Total Assets and Deferred Outflows ofResoruce$ 7,846,73612,115,066$ s
Liabilities
Current Liabilities
Accounts payable$ 2,17615,639$
9,8635,99Accruedpayrollandrelatedliabilities7
Accrued interes 20,79519,33t4
Current portion:
Accrued annual leave 4,8648,847
Notes payabl 129,24131,182e4
166,942180,999TotalCurrentLiabilities
Noncurrent Liabilities, net ofcurrent portion
15,50824,149Accruedannualleave
Notes payabl 1,710,771,579,595e7
Net pension liabilit -300,758y
1,726,2851,904,502TotalNoncurrentLiabilities
1,893,222,085,501TotalLiabilities7
5,324DeferredInflowsofResources - related topensions
Net Position
Net investment incapital asset 2,803,2767,051,146s
Unrestricted 3,150,2332,973,095
5,953,50910,024,241TotalNetPosition
Total Liabilities, Deferred Inflows ofResources and Net Position$ 7,846,73612,115,066$
108
Exhibit L-8
City of Seward, Alaska
Water Enterprise Fund
Statement ofRevenues, Expenses
andChange inNetPosition
Year Ended December 31,20152014
Operating Revenues
Residential$ 440,828455,795$
Small general service132,772 110,312
Large general service210,460 201,030
Industrial 236,152255,801
Seward Marine Industrial Cente 45,14149,367r
Ship water sales107,254 57,110
Miscellaneous 137,05872,537
1,227,6311,283,986TotalOperatingRevenues
Operating Expenses
Salaries and benefits439,097 381,246
Purchased services218,375 231,930
Contracted services47,130 3,100
Supplies and maintenance50,436 60,845
Administration and general261,466 268,904
Depreciation 202,548199,645
1,148,5731,216,149TotalOperatingExpenses
79,05867,837EarningsfromOperations
Nonoperating Revenues (Expenses)
76,85112,462Intergovernmental - PERS on-behalf
Investment income47,774 38,268
Interest expense(25,826) (28,071)
Net Nonoperating Revenues (Expenses) 87,04834,410
Earnings Before Contributions and Transfers 166,106102,247
Capital contributions4,305,736 -
Transfers in 98,010-
Transfers out (600,748)(142,954)
Change in Net Position (336,632)4,265,029
Net Position, beginning, as restated (Note 17) 6,290,1415,759,212
eoson,enng 5,953,50910,024,241$ NtPitidi
109
Exhibit L-9
City of Seward, Alaska
Water Enterprise Fund
Statement of Cash Flows
YearEndedDecember31, 20152014
CashFlowsfrom (for) OperatingActivities
Receiptsfromcustomersandusers$ 1,221,5101,266,130$
Paymentstosuppliers (340,235)(303,471)
Paymentstoemployees (300,726)(364,799)
Paymentsforinterfundservicesused (268,904)(261,466)
Netcashflowsfromoperating activities 311,645336,394
CashFlowsforNoncapitalFinancing Activities
Transfersout (600,748)(142,954)
CashFlowsfrom (for) CapitalandRelated FinancingActivities
Principalpaymentsonnotespayable (127,334)(129,244)
Interestpayments onnotespayable (29,510)(27,287)
Transfersin 98,010-
Acquisition ofproperty, plantandequipment(4,318,269) (97,913)
Capitalcontributionsreceived 19,3823,255,199
Netcashflowsforcapitalandrelatedfinancingactivities(1,219,601) (137,365)
CashFlowsfromInvestingActivities
Investmentincomereceived 38,26847,774
NetDecreaseinCashandInvestments (388,200)(978,387)
CashandInvestments, beginning 3,344,9852,956,785
CashandInvestments, ending$ 2,956,7851,978,398$
ReconciliationofCashandInvestmentstoStatementofNetPosition
Currentassets$ 1,050,0271,034,762$
Restrictedassets 1,906,758943,636
TotalCashandInvestments$ 2,956,7851,978,398$
ReconciliationofEarningsfromOperationstoNet
Cashfrom (for) OperatingActivities
Earningsfromoperations$ 79,05867,837$
Adjustmentstoreconcileearningsfromoperations
tonetcashflowsfrom (for) operatingactivities:
Depreciation 202,548199,645
Noncashexpense - PERSon-behalf 76,85112,462
Increaseinallowancefordoubtfulaccounts 288801
Increaseinassetsanddeferredoutflows ofresources:
Accounts receivable (6,409)(18,657)
Inventory (42,952)(991)
Deferredoutflowsofresources relatedtopensions(49,861) -
Increase (decrease) inliabilitiesanddeferredinflowsofresources:
Accounts payable (1,408)13,461
Accruedpayrollandrelatedliabilities 4,552(3,866)
Accruedannualleave (883)12,624
Netpensionliability -118,654
Deferredinflowsrelatedtopensions -(15,715)
NetCashfromOperatingActivities$ 311,645336,394$
110
Exhibit L-10
City of Seward, Alaska
Water Enterprise Fund
Schedule ofComposition of NetPosition
December 31,20152014
Grants and other external contributions7,886,929$ 3,581,193$
Related accumulated amortization(1,962,671) (1,889,251)
Contributions from other funds596,766 596,766
City-generated equity 3,664,8013,503,217
5,953,50910,024,241$ Total Net Position
111
Exhibit L-11
City of Seward, Alaska
WastewaterEnterprise Fund
StatementofNetPosition
December 31,20152014
Assets
Current Assets
Cash and investment$ 123,640-$ s
Receivables:
Account 88,22695,630s
Grants and loan 1,534,202s
Less allowance for doubtful account (3,970)(4,303) s
Net receivable 84,2561,625,529s
207,8961,625,529TotalCurrentAssets
Restricted Cash and Investment - capital project 1,168,512- ss
Property, Plant and Equipment
111,011111,011Landandlandrights
Buildings 2,418,3982,418,398
Infrastructure 29,69829,698
Improvements other than building 8,952,96811,804,000s
Equipmen 874,270888,278t
12,386,34515,251,385Totalproperty, plant and equipment in service
7,967,568)(8,203,036) Less accumulated depreciation
4,418,7777,048,349NetProperty, Plant and Equipment in Service
5,795,1858,673,878TotalAssets
51,723DeferredOutflowsofResources - related to pensions
Total Assets and Deferred Outflows ofResource$ 5,795,1858,725,601$ s
Liabilities
Current Liabilities
7,7184,086$ Accounts payable
Accrued payroll and related liabilitie 13,8354,133s
Due to other fund -62,221s
Current portion:
Accrued annual leave 3,6676,423
Notes payabl -58,986e
25,220135,849TotalCurrentLiabilities
Noncurrent Liabilities, net of current portion
Accrued annual leave 18,24421,948
Notes payabl -1,304,986e
Net pension liabilit -264,977y
43,4641,727,760TotalLiabilities
4,691DeferredInflowsofResources - related to pensions
Net Position
Net investment in capital asset 4,418,7775,684,377s
Unrestricted 1,332,9441,308,773
5,751,7216,993,150TotalNetPosition
Total Liabilities, Deferred Inflows of Resouces and Net Positio$ 5,795,1858,725,601$ n
112
Exhibit L-12
City ofSeward, Alaska
Wastewater EnterpriseFund
Statement ofRevenues, Expenses
andChange inNetPosition
Year Ended December 31,20152014
Operating Revenues
Residential$ 568,985604,405$
Small general service191,365 165,574
Large general service260,495 244,239
Seward Marine Industrial Center36,304 34,370
Miscellaneous 3,7223,482
1,016,8901,096,051TotalOperatingRevenues
Operating Expenses
Salaries and employee benefits380,132 364,932
Purchased services 230,427235,560
Contracted services 78,98125,805
Supplies and maintenance64,645 57,507
Administration and general156,188 164,020
Depreciation 222,789235,468
1,118,6561,097,798TotalOperatingExpenses
101,766)(1,747) Earnings (Loss) from Operations
Nonoperating Revenues (Expenses)
Intergovernmental - PERS on-behalf10,980 62,773
Investment income (loss)(4,242) 4,888
Other revenue -239
Interest expense (11)-
Net Nonoperating Revenues (Expenses) 67,6506,977
Earnings (Loss) Before Contributions and Transfers (34,116)5,230
Capital contributions1,470,230 -
Transfers in 500,00030,826
Transfers out (87,324)(93,676)
Change in Net Position 378,5601,412,610
Net Position, beginning, as restated (Note 17) 5,373,1615,580,540
5,751,7216,993,15$ 0NetPosition, ending
113
Exhibit L-13
CityofSeward, Alaska
Wastewater Enterprise Fund
Statement of Cash Flows
Year Ended December 31, 20152014
Cash Flows from (for) Operating Activities
Receipts from customers and user$ 1,037,0671,089,219$ s
Payments to suppliers (362,451)(329,642)
Payments to employees (293,919)(325,630)
Payments for interfund services use 164,020)(156,188) d
Net cash flows from operating activities 216,677277,759
Cash Flows from (for) Noncapital Financing Activities
Transfers in 500,00030,826
Transfers out (87,324)(93,676)
Net cash flows from (for) noncapital financing activitie 412,676(62,850) s
Cash Flows from (for) Capital and Related Financing Activities
Principal payments onnotes payabl (1,333)- e
20)- Interest payments on notes payable
Increase in due to other fund -62,221s
Capital contributions received -1,300,000
Acquisition of property, plant and equipmen (146,731)(2,865,040) t
Net cash flows for capital and related financing activitie (148,084)(1,502,819) s
Cash Flows from (for) Investing Activities
Investment income (loss) 4,888(4,242)
486,157(1,292,152) Net Increase (Decrease) in Cash and Investments
805,9951,292,152CashandInvestments, beginning
1,292,152-$ Cash and Investments, ending
Reconciliation ofCash and Investments to Statement of Net Position
Current assets$ 123,640-$
Restricted assets 1,168,512-
Total Cash and Investments$ 1,292,152-$
Reconciliation of Earnings (Loss) from Operations to Net
Cash from (for) Operating Activities
Earnings (loss) from operations$ (101,766)(1,747)$
Adjustments to reconcile earnings (loss) from operations
to net cash flows from (for) operating activities:
Depreciation 222,789235,468
Noncash expense - PERS on-behal 62,77310,980f
Other nonoperating revenu -239e
Increase (decrease) in allowance for doubtful account (9)333s
Increase) decrease inassets and deferred outflows of resources:
Accounts receivabl 186(7,404) e
Other receivabl 20,000- e
Deferred outflows of resources related to pension -(43,929) s
Increase (decrease) in liabilities and deferred inflows of resources:
Accounts payable 4,464(3,632)
Accrued payroll and related liabilitie 8,519(9,702) s
Accrued annual leav (279)6,460e
Net pension liabilit -104,538y
Deferred inflows related to pension -(13,845) s
Net Cash from Operating Activities$ 216,677277,759$
114
Exhibit L-14
City of Seward, Alaska
Wastewater Enterprise Fund
Schedule ofComposition of NetPosition
December 31,20152014
Grants and other external contributions11,705,799$ 10,405,799$
Related accumulated amortization(7,555,867) (7,062,014)
Contributions from other funds692,376 661,550
City-generated equity 1,746,3862,150,842
5,751,7216,993,150$ Total Net Position
115
Exhibit L-15
CityofSeward, Alaska
Harbor Enterprise Fund
Statement of Net Position
December31,20152014
Assets
CurrentAssets
Cashandinvestment$ 1,080,479313,275$ s
Receivables:
Accounts 155,496226,191
Grants 375,0733,509,291
Assessments 2,144-
Lessallowancefordoubtful accounts (23,834)(33,435)
508,8797Netreceivables3,702,04
1,589,3584,015,322TotalCurrentAssets
RestrictedCashandInvestments
t 690,198690,198Bondretiremen
Capital projects2,969,951 3,671,186
TotalRestrictedCash andInvestments 4,361,383,660,1494
Property, PlantandEquipment
Land and land rights18,175,05 18,175,0544
Buildings 775,201775,201
Infrastructure 97,72397,723
Improvementsotherthanbuildings 31,122,70131,522,291
t 1,592,9981,612,698Equipmen
51,763,6752,182,9677Totalproperty, plant and equipment in service
14,981,892)(16,349,436) Lessaccumulated depreciation
36,781,78535,833,531Netproperty, plantandequipmentinservice
181,29972,891,02Constructioninprogress
36,963,0838,724,5584TotalProperty, PlantandEquipment
42,913,82646,400,029TotalAssets
DeferredOutflows ofResources
Related topensions -164,817
Unamortizeddeferredlossonrefunding 239,26216,6374
239,2644TotalDeferredOutflowsofResources381,45
TotalAssetsand DeferredOutflowsofResources$ 43,153,0946,781,483$ 0
116
Exhibit L-15, continued
City of Seward, Alaska
Harbor Enterprise Fund
Statement ofNetPosition, continued
December 31,20152014
Liabilities
Current Liabilities
Accounts payable434,613$ 90,409$
Accrued payroll and related liabilities13,460 57,594
Accrued interest 32,842 31,919
Current portion:
Accrued annual leave 18,784 19,127
Bonds payable470,000 460,000
Interfund loan27,698 26,254
Unearned revenue554,560 567,677
Customer deposits42,753 36,078
1,289,0581,594,710TotalCurrentLiabilities
Noncurrent Liabilities, net of current portion
Accrued annual leave44,274 45,810
Bonds payable4,415,000 4,885,000
Notes payable1,201,196 1,201,196
Interfund loan 27,698-
Unamortized bond premium500,433 547,862
Net pension liability844,363 -
6,707,5667,005,266TotalNoncurrentLiabilities
7,996,6248,599,976TotalLiabilities
14,949DeferredInflowsofResources - related to pensions
Net Position
Net investment in capital assets33,044,764 30,798,488
Restricted for commercial passenger vessel tax1,354,473 2,066,039
Unrestricted3,767,321 2,291,939
35,156,46638,166,558TotalNetPosition
Total Liabilities, Deferred Inflows of Resources and Net Position$ 43,153,09046,781,483$
117
Exhibit L-16
City of Seward, Alaska
Harbor Enterprise Fund
Statement of Revenues, Expenses
and Change in Net Position
Year Ended December 31,20152014
Operating Revenues
Moorage$ 1,622,6801,603,487$
Wharfage 30,23261,526
110,659Boatliftfees111,34 7
Power sales 390,58436,353 7
Rentals and leases 318,711352,469
Passenger transit fees 604,800666,246
Miscellaneous 134,763128,027
3,212,4323,359,455TotalOperatingRevenues
Operating Expenses
Salaries and employee benefits1,178,441 1,142,099
Purchased services 486,873366,107
Power for resale 239,239250,279
Supplies and maintenance116,73 124,1867
Administration and general377,916 366,221
Depreciation 1,243,6321,367,544
3,602,2503,657,024TotalOperatingExpenses
389,818)(297,569) Loss from Operations
Nonoperating Revenues (Expenses)
Intergovernmental - PERS on-behalf34,987 158,044
Investment income 44,69036,758
Commercial passenger vessel tax1,242,072 961,178
Interest expense (207,946)(205,318)
Net Nonoperating Revenues (Expenses) 955,9661,108,499
Earnings Before Contributions and Transfers 566,148810,930
Capital contributions 11,707,112,911,132 4
Transfers in 241,272243,861
Transfers out (725,370)(410,352)
Change in Net Position 11,789,163,555,571 4
Net Position, beginning, as restated (Note 17) 23,367,30234,610,987
eoson,enng 35,156,46638,166,558$ NtPitidi
118
Exhibit L-17
City of Seward, Alaska
Harbor Enterprise Fund
Statement ofCash Flows
Year Ended December 31,20152014
Cash Flows from (for) Operating Activities
Receipts from customers and users3,291,919$ 2,781,538$
Payments to suppliers(388,919) (1,360,735)
Payments to employees(1,040,451) (954,825)
Payments for interfund services used(377,916) (366,221)
Net cash flows from operating activities1,484,633 99,757
Cash Flows from (for) Noncapital Financing Activities
Transfers in 241,272243,861
Transfers out(410,352) (725,370)
Net cash flows for noncapital financing activities(166,491) (484,098)
Cash Flows from (for) Capital and Related Financing Activities
Principal payments on long-term debt(460,000) (445,000)
Issuance of refunding bonds, including premium- 3,966,233
Payment to refunding bond escrow agent- (3,937,576)
Interest payments on long-term debt(229,197) (213,048)
Acquisition of property, plant and equipment(3,129,018) (1,864,099)
Capital contributions received325,665 1,994,827
Interfund loan payment(26,254) (24,885)
Commercial passenger vessel tax receipts 695,465 613,445
Net cash flows from (for) capital and related financing activities(2,823,339) 89,897
Cash Flows from Investing Activities
Investment income received36,758 39,075
255,369)(1,468,439) Net Decrease inCash and Investments
5,697,2325,441,863CashandInvestments, beginning
5,441,8633,973,424$ Cash and Investments, ending
Reconciliation of Cash and Investments to Statement of Net Position
Current assets313,275$ 1,080,479$
Restricted assets3,660,149 4,361,384
Total Cash and Investments $ 5,441,8633,973,424$
119
Exhibit L-17, continued
City of Seward, Alaska
Harbor Enterprise Fund
Statement ofCash Flows, Continued
Year Ended December 31,20152014
Reconciliation of Loss from Operations to Net
Cash from (for) Operating Activities
Loss from operations(297,569)$ (389,818)$
Adjustments to reconcile loss from operations to net cash
flows from (for) operating activities:
Depreciation1,367,544 1,243,632
158,04434,987Noncashexpense - PERS on-behalf
Increase (decrease) in allowance for doubtful accounts9,601 (838)
Increase in assets and deferred outflows of resources:
Receivables(70,695) (1,307)
Deferred outflows of resources related to pensions(139,982) -
Increase (decrease) in liabilities and deferred inflows of resources:
Accounts payable344,204 (510,437)
Accrued payroll and related liabilities(44,134) 36,285
Accrued annual leave (1,879) (7,055)
Customer deposits6,675 1,890
Unearned revenue(13,117) (430,639)
Net pension liability333,116 -
Deferred inflows of resources related to pensions(44,118) -
Net Cash from Operating Activities$ 99,7571,484,633$
Noncash Capital and Related Financing Activities
Purchase of equipment through issuance of notes payable-$ 1,201,196$
Increase in land from non-cash capital contribution-$ 11,386,763$
120
Exhibit L-18
City of Seward, Alaska
Harbor Enterprise Fund
Schedule ofComposition of NetPosition
December 31,20152014
Grants and other external contributions39,334,929$ 36,345,854$
Related accumulated amortization(10,303,788) (7,890,674)
Contributions from other funds6,482,874 6,239,014
City-generated equity 2,652,543 462,272
35,156,46638,166,558$ Total Net Position
121
Exhibit L-19
City of Seward, Alaska
Harbor Enterprise Fund
Schedule ofHarbor Capital Projects
SewerFish
FloatFloatsPumpCleaning
Year Ended December 31, 2015ReplacementReplacementStationStation
Funding Sources
State grants19,700$ 2,742,243$ -$ -$
Federal grants- - - 227,132
Harbor Fund- 138,929 1,015 -
Total Funding Sources $ 2,881,17219,700$ 1,015$ 227,132$
2,881,17219,700$ 1,015$ 227,132$ Capital Outlay
122
Exhibit L-20
Cityof Seward, Alaska
Seward Marine Industrial Center Enterprise Fund
Statement of Net Position
December 31,20152014
Assets
Current Assets
Account receivable$ 38,13155,545$
Grant receivable 1,307,111,146,5344
1,345,2451,202,079TotalCurrentAssets
Property, Plant and Equipment
Land and land rights 12,021,82112,021,821
Buildings 280,28280,2877
Improvements other than buildings40,647,33 39,943,7924
Equipment 1,650,3601,650,360
Total property, plant and equipment in service54,599,802 53,896,260
Less accumulated depreciation(29,422,321) (28,688,691)
Net property, plant and equipment in service25,177,481 25,207,569
Construction in progress 3,205,7103,746,518
28,413,27928,923,999TotalProperty, Plant and Equipment
Total Assets$ 29,758,5230,126,078 4
Liabilities
Current Liabilities
Accounts payable$ 207,8521,123,402$
Accrued payroll and related liabilities1,093 -
Interfund loan payable - current portion98,008 147,012
Deposits 9,20012,200
Unearned revenue 39,64763,100
Due to other funds 905,126185,768
1,308,831,483,571 7TotalCurrentLiabilities
Noncurrent Liabilities
Interfund loan, net of current portion784,066 882,075
Accrued leave - long term 271-
882,346784,066TotalNoncurrentLiabilities
2,191,1832,267,637TotalLiabilities
Net Position
Net investment in capital assets28,923,999 28,413,279
Unrestricted (deficit) (845,938)(1,065,558)
27,567,34127,858,441TotalNetPosition
Total Liabilities and Net Position$ 29,758,5230,126,078 4
123
Exhibit L-21
City ofSeward, Alaska
Seward MarineIndustrial CenterEnterprise Fund
Statement ofRevenues, Expenses
andChange inNetPosition
Year Ended December 31,20152014
Operating Revenues
Moorage$ 6,76314,201$
Wharfage 5,9956,969
Boat lift fees 133,949176,776
Storage 107,48198,727
Rentals and leases157,073 156,195
Power sales 53,820134,838
Miscellaneous 5,5904,723
469,793593,307TotalOperatingRevenues
Operating Expenses
Salaries and employee benefits116,769 110,734
Purchased services109,885 88,737
Contracted services89,000 17,113
Supplies and maintenance33,067 65,747
Administration and general177,808 128,959
602,368Depreciation733,63 0
Total Operating Expenses 1,013,6581,260,159
Loss from Operations (543,865)(666,852)
Nonoperating Revenues (Expenses)
Investment income (loss)(1,582) 1,625
Insurance recovery 5,520522
Net Nonoperating Revenues (Expenses) 7,145(1,060)
Loss Before Contributions and Transfers (536,720)(667,912)
Capital contributions1,244,350 1,731,339
Transfers in 350,00027,520
Transfers out (102,562)(312,858)
1,442,05291,1007ChangeinNetPosition
Net Position, beginning 26,125,28427,567,341
27,567,34127,858,441$ Net Position, ending
124
ExhibitL-22
City of Seward, Alaska
Seward Marine Industrial Center Enterprise Fund
Statement of Cash Flows
YearEndedDecember31, 20152014
CashFlowsfrom (for) OperatingActivities
Receipts from customers and users602,346$ 468,481$
Paymentstosuppliers (237,028)(236,492)
Paymentstoemployees (111,042)(115,947)
Payments for interfund services used(177,278) (128,959)
Net cash flows from (for) operating activities72,629 (8,548)
CashFlowsfrom (for) NoncapitalFinancingActivities
Transfersin 350,00027,520
Transfersout (102,562)(312,858)
Net cashflowsfrom (for) noncapital financingactivities(285,338) 247,438
CashFlowsfrom (for) Capitaland RelatedFinancing Activities
Acquisition of property, plant, and equipment(324,790) (2,977,501)
Issuanceofinterfundloan 1,029,08- 7
Increase (decrease) in due toother funds(719,358) 905,126
Interfundloanpayments -(147,013)
5,520522Insurancerecovery
Capital contributions received1,404,930 690,077
Netcashflowsfrom (for) capitalandrelated financingactivities214,291 (347,691)
CashFlowsfrom (for) InvestingActivities
Investment income (loss) 1,625(1,582)
107,176)- NetDecreaseinCash andInvestments
107,176- CashandInvestments, beginning
CashandInvestments, ending
ReconciliationofLossfromOperationstoNet
Cashfrom (for) OperatingActivities
Lossfromoperations$ (543,865)(666,852)$
Adjustmentstoreconcilelossfromoperationstonetcash
flowsfrom (for) operatingactivities:
Depreciation 602,368733,630
Increase inassets - accounts receivable(17,414) (3,146)
Increase (decrease) inliabilities:
Accountspayable (65,431)(4,010)
Accrued payroll and related liabilities822 (308)
Deposits 9,2003,000
Unearnedrevenue (7,366)23,453
NetCash from (for) OperatingActivities$ (8,548)72,629$
NoncashCapitalandRelatedFinancingActivities
Purchaseofcapital assets includedinaccountspayable1,114,485$ 194,925$
125
Exhibit L-23
City of Seward, Alaska
Seward Marine Industrial Center Enterprise Fund
Schedule ofComposition of NetPosition
December 31,20152014
Grants and other external contributions40,115,027$ 38,870,677$
Related accumulated amortization(26,683,814) (25,229,100)
Contributions from other funds17,472,393 17,472,393
City-generated deficit(3,045,165) (3,546,629)
27,567,34127,858,441$ Total Net Position
126
Exhibit L-24
City of Seward, Alaska
Parking Enterprise Fund
Statement of NetPosition
December 31,20152014
Assets
Current Assets
Cash and investments835,027$ 690,193$
Property, Plant and Equipment
Improvements other than buildings513,540 513,540
Equipment 150,360150,360
Total property, plant and equipment in servic 663,900663,900e
Less accumulated depreciation(600,770) (576,293)
87,60763,130NetProperty, Plant and Equipment in Service
Total Assets$ 777,800898,157$
Liabilities
Current Liabilities
Accounts payable$ 323447$
Accrued payroll and related liabilities333 -
323780TotalCurrentLiabilities
Net Position
Net investment in capital assets63,130 87,607
Unrestricted 689,870834,247
777,477897,377TotalNetPosition
Total Liabilities and Net Position$ 777,800898,157$
127
Exhibit L-25
City of Seward, Alaska
Parking Enterprise Fund
Statement ofRevenues, Expenses
andChange inNetPosition
Year Ended December 31,20152014
Operating Revenues - parking fees 293,379318,223$
Operating Expenses
Salaries and employee benefits88,891 123,937
Supplies and maintenance22,479 16,873
Purchased services15,054 21,800
Rents and leases13,000 13,000
Administration and general15,861 19,065
Depreciation 24,47624,477
Total Operating Expenses 219,151179,762
Earnings from Operations 74,228138,461
Nonoperating Revenues - investment income 7,4507,816
Earnings Before Transfers 81,678146,277
Transfers out (23,470)(26,377)
Change in Net Position 58,208119,900
Net Position, beginning 719,269777,477
eoson,enng 777,477897,377$ NtPitidi
128
Exhibit L-26
City of Seward, Alaska
Parking Enterprise Fund
Statement ofCash Flows
Year Ended December 31,20152014
Cash Flows from (for) Operating Activities
Receipts from customers and users318,223$ 293,379$
Payments to suppliers(50,409) (62,462)
Payments to employees(88,558) (124,011)
Payments for interfund services used(15,861) (19,065)
Net cash flows from operating activities163,395 87,841
Cash Flows for Noncapital Financing Activities
Transfers out (23,470)(26,377)
Cash Flows from Investing Activities
Investment income received7,816 7,450
71,821144,834NetIncreaseinCashandInvestments
618,372690,193CashandInvestments, beginning
690,193835,027CashandInvestments, ending
Reconciliation of Earnings from Operations to Net
Cash from Operating Activities
Earnings from operations138,461 74,228
Adjustments to reconcile earnings from operations
to net cash flows from (for) operating activities:
Depreciation24,477 24,476
Increase (decrease) in liabilities:
Accounts payable124 (10,789)
Accrued payroll and related liabilities333 (74)
Net Cash from Operating Activities$ 87,841163,395$
129
Exhibit L-27
City of Seward, Alaska
Parking Enterprise Fund
Schedule ofComposition of NetPosition
December 31,20152014
Grants and other external contributions425,893$ 425,893$
Related accumulated amortization(425,893) (425,893)
Contributions from other funds7,650 7,650
City-generated equity 769,827889,727
777,477897,377$ Total Net Position
130
Exhibit L-28
City of Seward, Alaska
Healthcare Facilities Enterprise Fund
Statement ofNet Position
December 31,20152014
Assets
Current Assets
Cash and investments$ 4,055,1886,426,831$
Receivables:
Accounts 6,935,0004,270,000
Other 470,795109,000
Less allowance for doubtful accounts (1,017,000)(1,754,000)
Net receivables 6,388,7952,625,000
Other Assets -76,589
10,443,9839,128,420TotalCurrentAssets
Restricted Cash and Investment bond retirement 1,973,3601,973,360s
Other Assets 118,000713,000
Property, Plant and Equipment
Buildings 22,788,80822,788,808
Infrastructure 843,185843,185
Improvements other than buildings 8,168,8508,168,851
Equipment 4,930,9864,913,451
Total property, plant and equipment in service 36,731,82936,714,295
Less accumulated depreciation (16,218,430)(18,058,080)
Net property, plant and equipment in service 20,513,39918,656,215
Construction in progress -135,740
20,513,39918,791,955TotalProperty, Plant and Equipment
Total Assets$ 33,048,7430,606,73$ 52
Liabilities
Current Liabilities
Accounts payable$ 190,000250,000$
Accrued payroll and related liabilities 990,000763,000
Accrued interest 350,765336,541
Current portion:
Bonds payable 825,000865,000
Interfund loan payable 72,89876,726
Unearned revenue 1,893,0001,585,000
Deposits -150,000
Payable to Providence Health and Services - Washington 5,454,0004,868,000
Due to contractual agencies -27,000
9,775,6638,921,267TotalCurrentLiabilities
Noncurrent Liabilities, net of current portion
Bonds payable 23,250,00022,385,000
Interfund loan payable 1,104,3671,027,641
Other liabilities 112,000-
Unamortized bond premium 320,802304,559
24,787,16923,717,200TotalNoncurrentLiabilities
34,562,83232,638,467TotalLiabilities
Net Position
Net investment in capital assets (1,909,043)(2,789,244)
Unrestricted 394,953757,512
1,514,090)(2,031,732) Total Net Position
Total Liabilities and Net Positio$ 33,048,7430,606,73$ n52
131
Exhibit L-29
City of Seward, Alaska
Healthcare Facilities Enterprise Fund
Statement ofRevenues, Expenses
andChange inNetPosition
Year Ended December 31,20152014
Operating Revenues
Net patient service revenues18,035,000$ 17,853,000$
Miscellaneous295,000 151,351
Total Operating Revenues 18,004,35118,330,000
Operating Expenses
Salaries and employee benefits12,001,000 11,399,000
Purchased services2,619,000 2,347,050
Supplies and maintenance978,000 1,007,126
Administration and general880,639 873,173
Depreciation1,946,744 2,201,219
Total Operating Expenses 17,827,56818,425,383
Earnings (Loss) from Operations 176,783(95,383)
Nonoperating Revenues (Expenses)
Investment income13 104
Interest expense(1,164,401) (1,270,392)
Nonoperating grant3,000 1,000
Loss on disposal of capital assets- (1,246,969)
Net Nonoperating Revenues (Expenses) (2,516,257)(1,161,388)
Loss Before Contributions and Transfers (2,339,474)(1,256,771)
Capital contributions109,300 219,505
Transfers in 1,136,7521,129,829
Transfers out(500,000) (910,418)
Change in Net Position (1,893,635)(517,642)
Net Position (Deficit), beginning 379,545(1,514,090)
eosonec,enng 1,514,090)(2,031,732)$ NtPiti(Dfiit)di
132
Exhibit L-30
City of Seward, Alaska
Healthcare Facilities Enterprise Fund
Statement of Cash Flows
Year Ended December 31,20152014
Cash Flows from (for) Operating Activities
Receipts from customers and users$ 15,836,55621,785,795$
Payments to suppliers (338,965)(4,756,589)
Payments toemployees (11,445,000)(12,228,000)
Payments forinterfund services used (873,173)(880,639)
Net cash flows from operating activities 3,179,4183,920,567
CashFlows from (for) Noncapital Financing Activities
Transfers in 1,136,7521,129,829
Transfers out (910,418)(500,000)
Net cash flows from noncapital financing activities629,829 226,334
Cash Flows from (for) Capital and Related Financing Activities
Principal payments onlong-term debt (785,000)(825,000)
Acquisition of property, plant, and equipment(225,300) (227,857)
Principal payments oninterfund loans (69,262)(72,898)
Capital contributions received 220,505112,300
Interest payments onlong-term debt (1,300,165)(1,194,868)
Increase (decrease) in due to contractual agencies27,000 (406,000)
Net cash flows for capital and related financing activities(2,178,766) (2,567,779)
Cash Flows from Investing Activities
Investment income received 10413
838,0772,371,643NetIncreaseinCashandInvestments
5,190,4716,028,548CashandInvestments, beginning
6,028,5488,400,191$ Cash and Investments, ending
Reconciliation ofCash and Investments to Statement ofNet Position
Current assets$ 4,055,1886,426,831$
Restricted assets 1,973,3601,973,360
6,028,5488,400,191$ Total Cash and Investments
Reconciliation ofEarnings (Loss) from Operations toNet
Cash from (for) Operating Activities
Earnings (loss) from operations$ 176,783(95,383)$
Adjustments toreconcile earnings from operations tonetcash
flows from (for) operating activities:
Depreciation 2,201,2191,946,744
Increase in allowance for doubtful accounts737,000 298,000
Increase) decrease inassets:
Accounts receivable (4,338,795)3,026,795
Other assets 188,650(671,589)
Increase (decrease) inliabilities:
Accounts payable (130,439)60,000
Other payables and deposits 2,957,000(548,000)
Accrued payroll and related liabilities(227,000) (46,000)
Unearned revenue 1,873,000(308,000)
Net Cashfrom Operating Activities$ 3,179,4183,920,567$
133
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134
Internal ServiceFunds
Motor PoolÏTheMotorPool Internal Service Fund accounts forpayments from departments for
theuseofvehicles, inorder toaccumulate cash toforward-fund replacement of vehicles. This
funding mechanism spreads the costof thevehicles over theexpected lifeofthe vehicle ineach
program'sannual budget, rather than toshowthecostofvehicles asaone-time expenditure to
each fund inthe yearofpurchase.
Compensated Annual Leave ÏThe Compensated Annual Leave Internal Service Fund wascreated in
2005 forthepurpose ofaccumulating cash reserves topayannual leavecash-outs for
governmental funds.
135
Exhibit M-1
City of Seward, Alaska
Motor PoolInternal Service Fund
Statement of NetPosition
December 31,20152014
Assets
Current Assets
Cash and investments1,227,190$ 736,050$
Receivables:
Accrued interest43,952 48,197
Interfund loans181,854 226,613
1,010,8601,452,996TotalCurrentAssets
Interfund Loans, net of current portion 1,717,9441,536,090
Property, Plant and Equipment
Equipment and vehicles6,563,057 6,162,868
Less accumulated depreciation(4,444,792) (4,010,009)
2,152,8592,118,265NetProperty, Plant and Equipment
Total Assets$ 4,881,6635,107,351$
Net Position
Net investment in capital assets2,118,265$ 2,152,859$
Unrestricted 2,728,8042,989,086
Total Net Position$ 4,881,6635,107,351$
136
Exhibit M-2
City of Seward, Alaska
Motor PoolInternal Service Fund
Statement ofRevenues, Expenses
andChange inNetPosition
Year Ended December 31,20152014
Operating Revenues - vehicle rental 582,890470,439$
Operating Expenses
Suppies an maintenance3,900 815ld
Depreciation 438,402434,783
Total Operating Expenses 439,217438,683
Earnings from Operations 143,67331,756
Nonoperating Revenues (Expenses)
Investment income46,920 60,376
21,006- Insurance recovery
Interest expense (111)-
Net Nonoperating Revenues (Expenses) 81,27146,920
224,94478,676IncomebeforeTransfers
Transfers in -147,012
Change in Net Position 224,944225,688
Net Position, beginning 4,656,7194,881,663
eoson,enng 4,881,6635,107,351$ NtPitidi
137
Exhibit M-3
City of Seward, Alaska
Motor PoolInternal Service Fund
Statement ofCash Flows
Year Ended December 31,20152014
Cash Flows from (for) Operating Activities
Receipts from vehicle rentals and other charges470,439$ 582,890$
Payments to suppliers(3,900) (815)
Net cash flows from operating activities466,539 582,075
Cas Fowsrom Noncapita Financing Activitieshlfl
ers in -147,012Transf
Cash Flows from (for) Capital and Related Financing Activities
Principal payments on capital lease obligations- (31,320)
Interest payments on capital lease obligations- (208)
Acquisition of equipment and vehicles(400,189) (214,244)
Insurance recovery 21,006-
Net cash flows for capital and related financing activities(400,189) (224,766)
Cash Flows from (for) Investing Activities
Interfund loan receipts 226,613 75,571
Interfund loan disbursements- (1,029,087)
Investment income received51,165 64,406
Net cash flows from (for) investing activities277,778 (889,110)
Net Increase (Decrease) in Cash and Investments (531,801)491,140
Cash and Investments, beginning736,050 1,267,851
Cash and Investments, ending1,227,190$ 736,050$
Reconciliation of Earnings from Operations to Net
Cash from Operating Activities
Earnings from operations31,756$ 143,673$
Adjustments to reconcile earnings from operations
to net cash flows from operating activities:
Depreciation434,783 438,402
Net Cash from Operating Activities$ 582,075466,539$
138
Exhibit M-4
City of Seward, Alaska
Motor PoolInternal Service Fund
Schedule ofComposition of NetPosition
Year Ended December 31,20152014
Grants and other external contributions97,289$ 97,289$
Related accumulated amortization(97,289) (97,289)
Contributions from other funds979,336 832,324
City-generated equity 4,049,3394,128,015
4,881,6635,107,351$ Total Net Position
139
Exhibit M-5
City of Seward, Alaska
Compensated Annual Leave Internal ServiceFund
Statement of NetPosition
December 31,20152014
Assets
urrensses - cas annvesmens 475,070505,354$ CtAthditt
Liabilities
Current Liabilities - accrued annual leave - current portion 119,049116,215$
Noncurrent Liabilities, net of current portion - accrued annual leav 356,021389,139e
Total Liabilities$ 475,070505,354$
140
Exhibit M-6
City o Sewar, Aasafdlk
Compensated Annual LeaveInternal ServiceFund
Statement ofRevenues, Expenses
andChange inNetPosition
Year Ended December 31,20152014
Operating Revenues - interfund charges 435,180473,650$
Operating Expenses - salaries and employee benefits 435,180473,650
Change in Net Position --
Net Position, beginning
eoson,enngNtPitidi
141
Exhibit M-7
City of Seward, Alaska
Compensated Annual Leave Internal ServiceFund
Statement ofCash Flows
Year Ended December 31,20152014
Cash Flows from (for) Operating Activities
Receipts from interfund charges473,650$ 435,180$
Payments to employees(443,366) (375,310)
Net cash flows from operating activities30,284 59,870
Cash and Investments, beginning475,070 415,200
Cash and Investments, ending505,354$ 475,070$
Reconciliation of Earnings from Operations to Net
Cash from Operating Activities
Earnings from operations-$ -$
Adjustments to reconcile earnings from operations
to net cash flows from operating activities - increase
in accrued annual leave30,284 59,870
Net Cash from Operating Activities$ 59,87030,284$
142
Exhibit N-1
City of Seward, Alaska
Teen Council Agency Fund
Statement ofChanges inAssets andLiabilities
Balance atBalance at
January 1,December 31,
Year Ended December 31, 20152015AdditionsDeletions2015
Assets
Cash and investments49,884$ 25,117$ 29,541$ 45,460$
Other assets150 - - 150
Total Assets$ 25,11750,034$ 29,541$ 45,610$
Liabilities
Accounts payable1,423$ 4,202$ -$ 5,625$
Other accrued liabilities193 - - 193
Due to Teen Council48,418 20,915 29,541 39,792
Total Liabilities$ 25,11750,034$ 29,541$ 45,610$
143
Exhibit O-1
City of Seward, Alaska
Schedule ofGovernmental Capital Assets
December 31,20152014
Capital Assets
Land and land improvements5,509,589$ 5,509,589$
Buildings70,253,752 70,147,968
Improvements other than buildings22,388,669 22,395,774
Equipment *9,254,678 8,849,577
Construction in progress502,839 258,593
Total Capital Assets$ 107,161,501107,909,527$
All Exhibit O Schedules exclude the Motor Pool Internal Service Fund assets. Those assets are included inthe
Governmental Capital Assets as reported in Note 4 to the financial statements.
144
Exhibit O-2
City of Seward, Alaska
Schedule ofChanges in Governmental Capital Assets
Balance atBalance at
January 1,Additions/Deletions/December 31,
Year Ended December 31, 20152015ReclassReclass2015
Land and land improvements5,509,589$ -$ -$ 5,509,589$
Buildings70,147,968 105,784 - 70,253,752
Improvements other than buildings22,395,774 442,288 449,393 22,388,669
Equipment 8,849,577 411,790 6,689 9,254,678
Construction in progress258,593 459,786 215,540 502,839
1,419,648107,161,501$ 671,622$ 107,909,527$
145
Exhibit O-3
City of Seward, Alaska
Schedule of Governmental Capital Assets by Function and Activity
December 31, 2015
Land andImprove-
Landments
Improve-Other than
Function and ActivitmentsBuildingsBuildingsEquipment Totaly
General Government
City Council/Mayor-$ -$ -$ 44,554$ 44,554$
City manager- - - 495,092 495,092
City clerk- - - 33,910 33,910
Finance- - - 309,336 309,336
Community development- 5,232 - 7,142 12,374
Municipal building- 3,178,250 34,257 55,596 3,268,103
Alaska SeaLife Center- 50,014,322 2,813,439 4,834,318 57,662,079
General services- 1,479,080 8,005,937 64,812 9,549,829
Community and Senior Center- 2,524,330 - - 2,524,330
Non-departmental5,509,589 127,105 9,000 19,805 5,665,499
Total General Government 57,328,3195,509,589 10,862,633 5,864,565 79,565,106
Public Safety
Police- 17,922 - 1,724,649 1,742,571
Jail- - - 9,408 9,408
Animal control- 156,720 - - 156,720
2,193,587Fire- 1,185,895 62,295 945,397
Building inspection- - - 2,600 2,600
Seward Volunteer Ambulance Corp- 58,382 - 38,508 96,890
Total Public Safety 1,418,919- 62,295 2,720,562 4,201,776
Public Works
Streets- 254,56 9,890,505 278,538 10,423,6107
Engineering- - - 3,621 3,621
City shop- 785,766 - 78,970 864,736
Total Public Works 1,040,333- 9,890,505 361,129 11,291,967
Parks and Recreation 769,066- 1,573,236 245,753 2,588,055
Library 9,697,115- - 62,669 9,759,784
Total Capital Assets
Allocated to Functions$ 70,253,7525,509,589$22,388,669$ 9,254,678$ 107,406,688
Construction in progress502,839
Total Capital Assets$107,909,527
146
Exhibit O-4
City of Seward, Alaska
Schedule ofChanges inGovernmental CapitalAssets byFunction andActivity
YearEnded December 31, 2015
CapitalCapital
Assets atAssets at
January 1,Additions/Deletions/December 31,
Function and Activity2015ReclassReclass2015
General Government
City Council/Mayor44,554$ -$ -$ 44,554$
City manager495,092 - - 495,092
33,910 - 33,910Cityclerk
Finance167,675 141,661 - 309,336
Community development12,374 - - 12,374
Municipal building3,262,937 5,166 - 3,268,103
Alaska Sealife Center57,949,126 169,035 456,082 57,662,079
General services9,538,042 11,787 - 9,549,829
2,524,330 - 2,524,330CommunityandSeniorCenter
Non-departmental5,598,262 67,237 - 5,665,499
Total General Government 394,88679,626,302 456,082 79,565,106
Public Safety
Police1,705,377 37,194 - 1,742,571
Jail9,408 - - 9,408
Animal control156,720 - - 156,720
Fire2,107,010 86,577 - 2,193,587
Building inspection2,600 - - 2,600
Seward Volunteer Ambulance Corp96,890 - - 96,890
123,7714,078,005 - 4,201,776TotalPublicSafety
Public Works
Streets10,021,000 402,610 - 10,423,610
Engineering3,621 - - 3,621
City shop864,736 - - 864,736
Total Public Works 402,61010,889,357 - 11,291,967
Parks and Recreation 38,5952,549,460 - 2,588,055
9,759,784 - 9,759,784Library
Construction in Progress 459,786258,593 215,540 502,839
1,419,648107,161,501$ 671,622$ 107,909,527$
147
Exhibit P-1
City of Seward, Alaska
Schedule of Expenditures of Federal Awards
For the Year Ended December 31, 2015
Pass-ThroughPassedTotal
FederalEntityThrough toTotalFederal
CFDAIdentifyingSubre-GrantExpen- FederalGrantor/Pass-ThroughGrantor/Programor
Cluster TitleNumberNumbercipientsAwardditures
Departmentof Agriculture
Passedthrough StateofAlaskaDepartment
of NaturalResources -
6,170-$ 6,170$ 2015 VolunteerFireAssistance Grant10.6642015VFA
DepartmentofInterior
PassedthroughStateofAlaskaDepartmentof
Commerce, Community & EconomicDevelopment -
227,132579,000SewardNorthEastHarborFishCleaningStation15.66810-CIAP-036
PassedthroughStateofAlaskaDepartment
of NaturalResources -
HistoricPreservation Fund Grants-In-Aid15.90415019 646646
TotalDepartmentofInterior 227,778
DepartmentofJustice
1,1721,172BulletProofVestPartnershipProgram16.607N/A
DepartmentofTransportation
PassedthroughStateofAlaskaDepartment
ofTransportationand PublicFacilities:
2,1542,222AKHighwaySafetyDUIHighVisibilityEnforce20.608164AL-15-01-00(A)-9
HighwaySafety Cluster -20.600402PT-15-06-00(E)-10 780780
StateandCommunityHighwaySafety
Total Department of Transportation2,934
Instituteof MuseumandLibrary Services
Passedthrough StateofAlaskaDepartment
ofEducationandEarlyDevelopment -
Continuing Education Program45.310CED-16-770-01 1,5001,500
DepartmentofHealth & HumanServices
HealthCentersCluster
Seward Community HealthCenter - HRSA93.224 25,4671,039,750
1,000,8251,026,292SewardCommunityHealthCenter - HRSA93.224
1,026,292TotalCFDA93.224
148
ExhibitP-1, continued
City of Seward, Alaska
Schedule of Expenditures of Federal Awards, continued
For the Year Ended December 31, 2015
Pass-ThroughPassedTotal
FederalEntitThrough tTotalFederalyo
CFDAIdentifyingSubre-GrantExpen-
Federal Grantor/Pass-Through Grantor/Program orCluster TitleNumbeNumbecipientsAwarddituresrr
DepartmentofHomelandSecurity
2011StateHomeland Security Program97.044N/A-$ 16,423$ 207$
PassedthroughStateofAlaskaDepartmentof
Commerce, Community & EconomicDevelopment -
ASFPM Conference97.023AR 29826- 400 195
PassedthroughStateofAlaskaDepartment
ofMilitaryandVeteransAffairs:
2014StateHomelandSecurityProgram97.06714SHSP-GR34094- 65,462 65,462
FEMA2012Flood PW4797.036FEMA-4094-DR-A 30,443- 10,210K
October2013 Flood / Storm97.036FEMA-4161-DR-A 17,650- 8,735K
Total CFDA 97.03618,945
Total Department ofHomeland Security84,809
EnvironmentalProtection Agency
PassedthroughStateofAlaskaDepartmentof
EnvironmentalConservation:
CleanWaterStateRevolvingFundCluster
SludgeRemoval LowellPointLagoon - Loanportion66.458769111- 565,594 565,594
SludgeRemovalLowellPointLagoon - ForgivenessPortion66.458769111- 62,844 62,844
SludgeRemovalLowellPointLagoon - ForgivenessPortion66.458769091- 79,009 79,009
Total Environmental Protection Agency707,447
TotalExpendituresofFederalAwards$2,058,102
149
Exhibit P-2
City of Seward, Alaska
Schedule ofState Financial Assistance
Year Ended December 31, 2015
State
TotalShare of
GrantGrantExpendi-
Grant Title NumberAwardtures
Department of Commerce, Community
and Economic Development
13-GO-01410,000,000$ 1,244,350$
Fisheries Resource LandingN/A17,356 17,356
Water Storage Tank12-RR-0301,992,000 1,797,736
Sludge Removal Lowell Point Lagoon15-DC-1441,300,000 1,300,000
State Revenue SharingN/A216,994 216,994
Total Department of Commerce, Community
and Economic Development 4,576,436
Department of Military and Veteran Affairs
September 2012 FloodFEMA-4094-DR-AK10,148 3,403
Oct 2013 Flood/StormFEMA-4161-DR-AK5,883 2,912
Total Department of Military and Veteran Affairs 6,315
Department of Revenue
Fish TaxesN/A334,691 334,691
Liquor LicensesN/A19,350 19,350
Commercial Passenger Vessel Tax 2012N/A343,265 45,911
Commercial Passenger Vessel Tax 2013N/A306,723 306,723
Commercial Passenger Vessel Tax 2014N/A347,732 347,732
Commercial Passenger Vessel Tax 2015N/A447,170 31,647
Passed through Kenai Peninsula Borough:
Commercial Passenger Vessel Tax 2011N/A1,086,570 715,685
Commercial Passenger Vessel Tax 2012 N/A343,265 343,265
Commercial Passenger Vessel Tax 2013N/A306,723 162,675
Total Department of Revenue 2,307,679
Department of Administration
PERS ReliefN/A1,397,578 1,397,578
Department of Transportation and Public Facilities
16-HG-001 2,684,000 2,684,000SewardHarborB, C, S Dock Replacement Project
Department of Education and Early Development
Public Library AssistancePLA-14-770-656,650 5,352
Public Library AssistancePLA-16-770-016,650 6,650
Early Literacy Place Space Mini GrantELM-15-770-161,539 1,539
Total Department of Education and Early Development 13,541
Alaska Energy Authority
Seward Power Plant Integration79100115,940,000 3,380,957
Department of Environmental Conservation
North Seward Water Storage Tank769142,508,000 2,508,000
Sludge Removal Lowell Point Lagoon - Forgiveness Portion76909115,806 15,806
Sludge Removal Lowell Point Lagoon - Forgiveness Portion76911112,572 12,572
Total Department of Environmental Conservation 2,536,378
Total State Financial Assistance$ 16,902,884
Major program
150
City of Seward, Alaska
Notes toSchedule ofExpenditures ofFederal Awards andScheduleofState
Financial Assistance
YearEnded December 31, 2015
1. Basis ofPresentation
Theaccompanying schedule ofexpenditures offederal awards andschedule ofstate financial
assistance (theÑSchedulesÒ) include thefederal andstateaward activity ofCityof Seward, Alaska
under programs ofthe federal andstate governments for theyearended December 31, 2015. The
information intheSchedules ispresented inaccordance with therequirements ofTitle 2U.S.
Uniform Administrative Requirements, Cost Principles, andCodeofFederalRegulationsPart200
AuditRequirements forFederal Awards (Uniform Guidance) StateofAlaska AuditGuideandthe
andCompliance Supplement forStateSingle Audits, respectively. Because theSchedules present
onlyaselected portion ofthe operations of CityofSeward, Alaska, theyare notintended toand
donotpresent thefinancial position, changes innetposition orcashflows of City of Seward,
Alaska.
For theyearended December 31, 2015, alloftheCityÔs federal awards were intheform ofcash
assistance.
TheCity hadnofederally funded insurance programs orloan guarantees during theyear ended
December 31, 2015. Aportion of thefunding provided under CFDA #66.458was provided through
arevolving loanprogram managed bytheState of Alaska. Theunderlying funding source wasa
federal grant, buttheCityisrequired to payback theÑloanÒ portion totheState ofAlaska under
defined loan terms.
2. SummaryofSignificant Accounting Policies
Expenditures reported ontheSchedules are reported onthe modified accrual basisofaccounting.
Such expenditures arerecognized following, asapplicable, either thecostprinciples inOMB
CostPrinciples forState, LocalandIndian Tribal GovernmentsCircularA-87, , orthecost
Uniform AdministrativeprinciplescontainedinTitle2U.S. Code ofFederal Regulations Part200,
Requirements, Cost Principles, andAuditRequirements for FederalAwards depending onthe
award date) wherein certain typesof expenditures arenot allowable orarelimited asto
reimbursement. Such expenditures arerecognized following thecostprinciples contained inthe
Uniform Guidance, wherein certain types ofexpenditures arenotallowable orarelimited asto
reimbursement. Negative amounts shown ontheSchedule represent adjustments orcredits made
inthenormal course ofbusiness toamounts reported as expenditures inprior years. TheCityhas
notelected to usethe10percent deminimis indirect costrate allowed under theUniform
Guidance.
3. Commercial Passenger Vessel Tax – State Assistance
Cash receipts forcommercial passenger vessel taxeshave been recorded asrevenue intheHarbor
Fundonanaccrual basis. Anyunspent portion ofthese funds, isreported asrestricted netposition in
thefund financial statements. AtDecember 31, 2015, thecumulative unspent vessel taxreceipts
were $1,354,473. Total vessel taxfunds expended in2015 and reported ontheschedule ofstate
financial assistance were $1,953,638.
151
City of Seward, Alaska
Notes toSchedule ofExpenditures ofFederal Awards andScheduleofState
Financial Assistance, continued
YearEnded December 31, 2015
4. PERS On-behalf
The Cityhasrecorded $1,397,578inPERS On-behalf payments intheschedule of statefinancial
assistance. Thisrepresents thePERS relief payments appropriated and transferred intotheplan
duringcalendar year 2015 andrelatestobothpension andOPEB contributions.
Inthe governmental fund financial statements, on-behalf revenue andexpenditures havebeen
recognized intheirproportional share ofon-behalfpayments within thecalendar yearunder audit.
However, inthefullaccrual financial statements (thegovernment-wideandenterprise fundfinancial
pension costatements), GASB 68provisions prescribe thaton-behalf ntributions inaspecial funding
measurement periodsituationmayonlyberecognizedduringtheinwhich the plan recognizes the
contributions. For theCityofPalmer, thePERS planmeasurement period isJuly1, 2014 through
June 30, 2105, creating asix-month timing difference between the cash contribution andrevenue
andexpense recognition forthe pension on-behalf bytheCityinthose funds.
Asaresult of these perspective andtimingdifferences, amounts reported onthefinancial statements
donotagree totheamount reported ontheschedule ofstate financial assistance.
152
City ofSeward, Alaska
Statistical Section
This part of the City of Seward'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.
ContentsPage
Financial Trends
These schedules contain trend information to help the reader understand how the City's
financial performance and well-being have changed over time.
Table 1Net Position by Component154
Table 2Changes in Net Position155-156
Table 3Fund Balances of Governmental Funds157
Table 4Changes in Fund Balances of Governmental Funds158
Table 5General Fund Revenues by Source159
Table 6General Fund Tax Revenues by Source160
Revenue Capacity
These schedules contain information to help the reader assess the City's most significant local
revenue sources, sales and property tax.
Table 7Property Tax Rates161
Table 8Property Tax Levies and Collections162
Table 9Assessed and Estimated Actual Value of Taxable Property163
Table 10Principal Property Taxpayers164
Table 11Principal Taxable Sales by Line of Business165
Debt Capacity
These schedules present information to help the reader assess the affordability of the City's
current level of outstanding debt and the City's ability to issue additional debt
Table 12Ratios of Outstanding Debt by Type166
Table 13 Ratio of General Obligation Bonded Debt to Assessed Value and General Obligation
Bonded Debt per Capita 167
Computation of Direct and Overlapping Bonded DebtTable14168
Table 15Legal Debt Margin169
Table 16Revenue Bond Coverage - Electric Enterprise Fund170
Revenue Bond Coverage - Harbor Enterprise FundTable17171
Demographic and Economic Information
These schedules offer demographic and economic indicators to help the reader understand the
environment within which the City's financial activities take place.
Table 18Demographic and Economic Statistics172
Table 19Principal Employment by Industry173
Table 20Full-Time Equivalent Employees by Fund174
Table 21Operating Indicators by Function175
Table 22Capital Asset Statistics by Function176
Table 23Property Value, Construction, and Bank Deposits177
Table 24Miscellaneous Statistics178
153
Table 1 58,190 6,278 64,468 91,783 1,354 17,582 110,719149,973 1,354 23,860 175,187
2006200720082009201020112012201320142015
59,408 2,442 8,715 70,565 82,209 2,066 15,516 99,791 4,508 24,231141,617 170,356
60,740 26 10,143 70,909 70,569 5,441 10,892 86,902 5,467 21,035131,309 157,811
2661,393 8,669 70,088 65,910 5,150 10,944 82,004127,302 5,176 19,613 152,091
56,122 3,730 5,785 65,637 68,657 1,388 15,649 85,694 5,118 21,434124,779 151,331
56,122 9,983 66,105 67,773 3,465 10,290 81,528 123,895 3,465 20,273 147,633amountsexpressedinthousands)
accrual basis of accounting) Net Position byComponentAlaskaLastTenFiscalYears
56,208 8,619 64,827 64,112 2,111 14,777 81,000 120,320 2,111 23,396 145,827
of Seward 154
700 70058,016 5,993 64,009 66,754 14,796 82,250 124,770 20,789 146,259
yCit
58,016 5,025 63,041 65,440 16 14,595 80,051 16 19,620123,456 143,092
Restricted-Restricted-Restricted- Netinvestmentincapitalassets$56,663Unrestricted5,901$62,564Netinvestmentincapitalassets$64,760Unrestricted12,837$77,597Netinvestment incapitalassets$121,423Unrestricted18,738$140,161
Total Governmental ActivitiesTotalBusiness-type Activities
Total Primary Government
Governmental ActivitiesBusiness-type Activities
Primary Government
Net Position Net Position Net Position
Table 2
City of Seward, Alaska
Changes in Net Position
Last Ten Fiscal Years
accrual basis of accounting)
2006200200820092012011201201320120157024
Expenses
Governmental activities:
General government$2,158,969 1,161,765 2,501,443 1,451,682 800,716 2,031,590 1,981,876 2,199,711 3,291,580 3,517,517
Public safety2,440,488 2,980,785 2,934,607 3,029,935 3,168,421 3,140,921 3,360,091 3,510,922 3,476,471 3,563,666
Public works1,704,296 2,650,977 1,310,474 1,456,468 1,991,925 1,988,748 2,410,794 1,851,321 1,635,967 1,791,967
Parks andrecreation1,075,945 981,222 1,236,411 1,247,366 1,462,365 1,395,705 1,320,447 1,338,404 1,315,282 1,463,364
Library378,487 384,835 398,108 478,385 437,082 466,300 446,200 489,548 804,539 785,299
Clinic- - - - - - - - 1,454,476 1,682,532
Healthcare facilities924,795 535,226 412,797 3,910,190 2,804,000 - - - -
Sealife Center1,578,315 1,672,365 1,736,147 1,294,636 731,528 51,939 965,206 848,940 1,279,570 1,457,308
Unallocated interest347,367 306,989 116,906 236,982 1,505,248 173,993 206,778 208,840 157,984 153,950
Total governmental activities expenses10,608,662 10,674,164 10,646,893 13,105,644 12,901,285 9,249,196 10,691,392 10,447,686 13,415,869 14,415,603
Business-type activities:
Electric9,195,187 8,029,054 8,626,745 10,363,820 8,569,240 10,493,512 9,935,695 10,590,994 10,255,601 10,599,641
Water813,245 859,799 1,194,311 1,066,860 1,093,419 1,230,833 1,246,997 1,087,747 1,175,129 1,241,671
Wastewater693,096 747,484 901,759 916,909 1,078,318 1,044,654 1,013,492 1,015,474 1,117,152 1,097,494
2,457,2162,648,290 3,006,069 3,934,866 5,947,066 3,676,190 4,243,734 3,837,952 3,792,623 3,858,440Harbor
Seward Marine Industrial Center1,278,774 1,076,730 1,149,453 990,466 926,290 1,081,862 928,458 899,343 1,013,658 1,260,159
Healthcare facilities- - - - - 20,416,615 21,856,797 20,858,042 20,344,929 19,589,784
Parking117,150 129,623 119,723 118,309 157,229 205,407 237,522 146,239 214,775 178,886
Total business-typeactivities expenses14,745,742 13,299,906 14,998,060 17,391,230 17,771,562 38,149,073 39,462,695 38,435,791 37,913,867 37,826,075
Total Primary Government Expenses$25,354,404 23,974,070 25,644,953 30,496,874 30,672,847 47,398,269 50,154,087 48,883,477 51,329,736 52,241,678
Program Revenues
Governmental activities:
Charges forservices:
General government$106,589 400,074 196,240 223,545 201,335 190,795 184,410 202,893 282,318 294,499
Public safety761,316 706,575 669,988 744,939 682,906 740,204 809,645 897,319 937,659 817,995
Public works239,984 111,756 116,833 84,849 168,196 40,910 36,721 30,565 20,383 22,278
Parks and recreation529,289 592,063 627,038 622,067 608,361 620,943 609,342 653,054 663,298 778,350
Library8,677 7,736 12,800 14,799 13,794 9,953 9,208 29,911 39,707 33,762
Clinic- - - - - - - - 62,306 75,085
Healthcare facilities- - - - 2,569,886 - - -
Operating grants andcontributions148,785 680,176 84,144 542,354 620,310 1,128,278 1,037,711 1,002,434 1,148,124 1,156,755
Capital grantsandcontributions2,124,245 1,459,744 999,171 2,860,172 1,709,977 3,573,497 3,442,599 23,034 819,241 621,712
Totalgovernmental activities program revenues:3,918,885 3,958,124 2,706,214 5,092,725 6,574,765 6,304,580 6,129,636 2,839,210 3,973,036 3,800,436
Business-type activities:
Electric7,979,436 8,428,106 8,565,180 9,060,636 8,842,150 10,309,524 11,224,511 11,040,608 11,433,004 11,482,077
Water1,008,765 996,633 998,541 972,713 1,034,888 1,069,732 1,150,109 1,280,710 1,227,631 1,283,986
Wastewater811,546 800,168 801,095 796,454 851,416 864,740 929,514 960,591 1,016,890 1,096,290
Harbor 2,751,9162,499,065 2,776,676 2,596,924 2,803,828 2,968,021 3,169,744 3,235,923 3,212,432 3,359,455
Seward Marine Industrial Center286,640 290,221 304,517 263,775 296,139 413,454 414,737 391,954 469,793 593,307
Healthcare facilities- - - - - 16,838,000 18,728,364 21,880,406 18,004,351 18,330,000
Parking175,792 182,133 240,339 162,120 192,046 268,105 293,443 312,248 293,379 318,223
Operating grants andcontributions1,260,476 65,247 159,595 445,228 2,674,610 401,734 154,295 170,531 472,944 113,439
Capital grants andcontributions928,554 2,578,739 2,769,005 2,354,601 1,988,430 2,291,919 1,732,343 4,125,258 14,713,420 13,559,150
Totalbusiness-typeactivities program revenues14,950,274 16,093,163 16,614,948 16,652,451 18,683,507 35,425,229 37,797,060 43,398,229 50,843,844 50,135,927
Total Primary Government Revenues$18,869,159 20,051,287 19,321,162 21,745,176 25,258,272 41,729,809 43,926,696 46,237,439 54,816,880 53,936,363
Net (Expenses)/Revenue
Governmental activities$(6,689,777) (6,716,040) (7,940,679) (8,012,919) (6,326,520) (2,944,616) (4,561,756) (7,608,476) (9,442,833) (10,615,167)
Business-type activities204,5322,793,257 1,616,888 (738,779) 911,945 (2,723,844) (1,665,635) 4,962,438 12,929,977 12,309,852
Total Primary Government Net Expense$(6,485,245) (3,922,783) (6,323,791) (8,751,698) (5,414,575) (5,668,460) (6,227,391) (2,646,038) 3,487,144 1,694,685
Healthcare facilities isanewenterprise fund in2011previously reported asgovernmental fund anddiscreetly presented component unit.
SeeStatement ofActivities (Exhibit A-2) ofCAFR, p. 21.
155
Table 2, continued
1,181,852) (2,013,080) 522 10,636,2024,883,996 1,013,370 546,936 850,297 125,636 1,181,852 8,602,087 278,688 1,242,072 339,430 8,941,517 12,649,282 170,356,262 182,578,327 10,636,202
2006200720082009201020112012201320142015
1,243,171) (40,298) (344,408) 4,535,707 989,910 421,981 1,766,622 141,034 1,243,171 9,098,425 236,175 961,178 5,520 9,058,127 12,889,679 12,545,271 157,810,991 170,356,262 12,545,271
64,625) 546,005) 489,926 57,958 546,005 138,115 343,265 821,2574,583,057 1,261,276 1,491,511 8,429,733 8,365,108 4,897,813 5,719,070 152,091,921 157,810,991 5,719,070
1,970,983) (1,418,542) (3,084,177) 4,189,330 1,025,266 456,370 1,250,895 119,662 1,970,983 9,012,506 209,176 343,265 7,593,964 4,450,750 1,366,573 **150,725,348 152,091,921 1,366,573
1,290,998) 203,1294,147,010 999,737 413,398 91,248 181,718 **148,386,4371,346,755 5,707,150 1,411,435 1,290,998 2,905,562 8,612,712 2,762,534 2,944,252 151,330,689 2,944,252
accrual basis of accounting) 1,258,053) (383,725) 149,288960,397 403,713 753,653 138,940 347,281 720,040 5,000 528,220 145,826,8953,742,751 1,258,053 7,604,788 7,221,063 1,278,268 1,806,488 147,633,383 1,806,488CityofSeward, AlaskaChangesinNetPositionLastTenFiscalYears
continued
156
1,466,933) (511,302) (1,250,081) (432,271) (432,271) 184,566 146,259,1663,585,304 986,473 370,235 670,761 128,971 1,622,052 1,466,933 8,830,729 771,065 8,319,427 817,810 145,826,895
912,319) 640,277943,832 442,130 612,611 912,319 504,917 713,178 139,952 581,088 967,759 143,093,4314,137,758 1,354,871 8,908,438 9,489,526 2,197,976 3,165,735 146,259,166 3,165,735BeginningnetpositionrestatedforHealthcare Facilities becoming anewenterprise fundin2011.
989,801) (338,038) 651,763862,258 419,771 538,799 314,642 989,801 477,831 140,160,3814,068,600 7,193,871 6,855,833 2,455,219 2,933,050 143,093,431 2,933,050
Other(287,018)Transfers(1,502,583)Totalbusiness-typeactivities(852,505)Business-typeactivities(647,973)$(525,553)$(525,553) NPO/OPEB-Grantsandentitlements-Other- Salestax$3,518,435 Propertytax864,906 Othertax388,284Grantsandentitlements388,766Investment earnings436,241Transfers1,502,583Totalgovernmental activities6,812,197Investment earnings650,078Total primarygovernment5,959,692Governmental activities$122,420Beginning NetPosition$140,685,934EndingNetPosition140,160,381
Seep. 21 (Exhibit A-2) ofCAFRfordetails
GeneralRevenues andOther Changes
TotalPrimary GovernmentSpecialitem -write-off
Governmental activities: Business-typeactivities: Changes inNetPositionChange inNetPosition
inNet Position
Taxes:
Table 3 600,308 2,126,418 324,465 4,718,517 7,769,708 2,507,741 2,517,417 10,287,1259,676
2006200720082009201020112012201320142015
10,217,264351,045 2,126,418 271,966 4,698,970 7,448,399 16,746 2,752,119 2,768,865
481,449 2,126,418 5,948,459 8,677,094120,768 864,471 890,551 9,567,64526,080
12,880) 457,897 2,126,418 4,827,055 7,411,37026,080 891,865 905,065 8,316,435
12,880) 397,4062,126,4183,510,601$6,034,425279,901$10,031,5833,730,137$3,997,158
Fund Balances ofGovernmental Fundsmodifiedaccrualbasisofaccounting) 584,948 2,126,418 4,039,264 6,750,630 2,472,376 75,369 235,860 2,783,605 9,534,235
CityofSeward, AlaskaLastTenFiscalYears
Unreserved:
657,029 2,126,418 2,983,424 5,766,871 1,177,697 100,330 308,485 1,586,512 7,353,383
157
12,321,378 13,793,964 17,903,591693,590 2,126,418 1,289,619 4,109,627 1,063,260 409,326
34,649) (315,698) 458,860 2,126,418 1,433,552 4,018,830 945,478 595,131 4,613,961
GASB 54 implementation effective from 2011. Prior years not restated.
Special revenue funds(510,560) Reserved$388,409Designated2,569,418Undesignated1,076,827$4,034,654Reserved - debtservice$661,787Capital projects funds1,635,625$1,786,852$5,821,506
Total All Other Governmental Funds Total All Other Governmental Funds
All Other Governmental FundsAll Other Governmental FundsTotalAllGovernmentalFundsTotalAllGovernmental FundsSeep. 22 (Exhibit B-1) of CAFR
Unreserved, reported in:
Unassigned (deficit)
Total General FundTotal General FundPRIORTOGASB54NonspendableNonspendable
CommittedUnassignedGeneralFundGeneralFundPOSTGASB54 RestrictedAssignedAssigned
Table 4
964,979) (2,386,919) noncapital expenditures (a ÷ b) ^10.37%11.79%18.36%11.35%19.96%1.94%1.48%1.54%2.36%1.90%noncapital expenditures (a ÷ b) ^11.91%13.37%-62.08%166.06%20.01%1.94%1.48%1.54%2.36%1.90% 6,438,604 206,365 3,401,334 2,775,824 78,716 208,397 3,279,972 3,366,320 1,523,557 1,374,393 553,272 1,682,532 1,401,165 647,858 90,000 155,150 14,074,219 3,421,759 1,034,840 69,861 10,217,264 10,287,125 69,861$ 12,870,111$12,870,11113,109,240
2006200720082009201020112012201320142015
593,552) (3,760,229) 6,027,632 185,925 3,921,858 2,650,995 80,658 693,177 3,229,754 3,480,308 1,659,642 1,363,572 572,512 1,454,476 1,373,271 775,862 85,000 159,400 14,153,797 5,003,400 1,243,171 649,619 9,567,645 10,217,264 649,619$ 10,366,369$ 10,366,36913,560,245
1,843,215) 6,351,525 204,926 3,091,794 2,614,684 5,359 186,662 3,434,883 3,280,724 1,832,897 1,291,197 535,747 836,750 378,147 159,400 11,749,745 705,205 2,389,220 546,005 1,251,210 8,316,435 9,567,645 1,251,210$ 10,366,369$ 10,366,36912,454,950
3,686,131) (2,292,685) (1,715,148) (1,715,148) 5,661,136 159,114 5,749,394 2,540,717 56,752 708,556 14,875,669 3,084,356 3,535,153 2,339,996 1,501,366 7,291,434 656,294 153,201 18,561,800 4,263,668 1,970,983 10,031,583 8,316,435$ 10,354,048$ 10,354,048
3,270,288) 5,563,249 160,096 6,542,863 2,645,948 25,744 167,034 3,186,257 4,767,575 1,883,297 1,563,361 2,364,176 631,278 100,477 75,547 14,571,968 532,966 3,480,000 259,854 1,979,290 2,448,856 2,981,822 7,049,761 10,031,583 2,981,822$ 9,074,143$ 9,074,14315,104,934
1,534,388) 5,102,154 148,948 3,409,407 2,853,310 138,940 3,334,671 2,771,383 4,127,704 1,886,709 1,392,483 1,026,797 529,778 838,386 1,461,315 14,064,631 922,799 2,792,441 1,258,053 2,180,852 7,353,383 9,534,235 2,180,852$ 11,521,748$ 11,491,67214,987,430 30,076
h with and without health facilities. Changes in Fund Balances of Governmental Funds
Modified Accrual Basis of Accounting)
12,017,140) (1,480,120) (10,550,207) (10,550,207) 4,932,555 214,966 3,907,151 2,553,480 128,971 2,448,998 3,485,932 4,774,604 1,618,075 1,608,957 463,427 596,907 787,695 695,299 26,203,261 2,947,053 1,466,933 17,903,590 7,353,383$ 13,065,387$ 893,02214,186,121 12,172,365CityofSeward, Alaska
Last Ten Fiscal Years Debt service:
158
15,028,767) (2,264,469)$ (3,330,395) 5,535,081 12,032,612 3,369,478 3,333,433 1,662,695 1,198,798 368,696 27,061,379 3,176,788 27,406,078 28,318,397 13,289,630 4,613,961 17,903,590 13,289,629$ 11,259,806129,956 2,355,038 2,610,515 612,611 789,411 14,590,201 470,573 738,999 1,328,506
Health facilities are no longer classifed as governmental funds after 2010, so for the sake of consistency, providing data bot
2,197,346) (2,641,515) (1,207,545) (1,207,545) 5,363,265 144,654 2,072,811 2,375,767 314,642 125,186 2,956,706 3,011,920 2,678,493 1,084,002 339,222 1,114,693 293,114 854,977 260,544 12,593,671 3,631,316 989,801 5,821,506 4,613,961$ 9,458,715$ 8,344,02210,396,325
Computed as follows: (Principal + Interest) / (Total expenditures - capitalized expenditures (principal))
2,752,258)Transfers out(2,232,719)$(1,253,208)$(1,253,208) Net bond proceeds- 332,577*Healthcare facilities 1,615,516Taxes$4,756,073Licensesandpermits278,515Intergovernmental3,057,175ChargesforServices2,078,065Investment earnings436,241Otherrevenues256,42710,862,496General government 2,737,586Public safety2,792,296Public works1,962,053Parks andRecreation1,074,141Retirement benefits 1,805,475 Principal(a)892,836 Interest and other costs(a)402,27413,614,754Transfers in3,731,7691,499,050$7,07 4,7145,821,506Total non-capital expenditures(b)12,493,460Total non-capital expenditures(b)10,877,
944 Beginning fund balances restated for PSMCC becoming a new enterprise fund in
2011. Total Other Financing Sources (
Uses) Excluding HealthcareFacilities: # Proceeds from debt issuance:Including HealthcareFacilities: # Other Financing Sources (Uses)Debt serviceasa percentageof Debt service as a percentage
of See p. 25 (Exhibit B-4) ofCAFRNetChangeinFundBalancesNetChangeinFund
Balance Fund Balances, beginningExcessofRevenues Over(Under)
Expenditures Fund Balances,
ending Total
Expenditures CapitaloutlayTotal Revenues ParvaluePremium
ExpendituresLibraryRevenues
Table 5
11,080,997 *10,181,373 11,448,742 11,695,374 11,905,3828,683,777 9,473,066 10,597,391 10,454,249 10,431,339
Total
175,079 97,445 141,602 1,741,084 532,390 59,189 51,824 167,360 124,873 125,812
BailsInterestOther
392,379 285,066 226,854 50,311 122,710 25,744 56,690 5,359 80,658 78,716
Fines and16,073 17,611 18,209 11,836 10,210 12,177 8,386 9,530 14,073 17,993Includesone-time Exxon Valdez Oil Settlement Proceeds of $1.6 Million in 2009 and $331,791 in 2010.
General Fund Revenues by Source
CityofSeward, AlaskaLastTenFiscalYearsChargesfor2,078,065 2,375,767 2,610,515 2,553,480 2,853,310 2,645,948 2,540,717 2,614,684 2,650,995 2,757,831
Services
159
1,066,093 1,189,258 1,935,174 1,576,765 1,411,651 1,987,846 1,953,472 2,095,358 2,611,218 2,280,061governmental
Inter-
Licenses and200,015 144,654 129,956 214,966 148,948 160,096 159,114 204,926 185,925 206,365
Permits
20064,756,07320075,363,26520085,535,08120094,932,55520105,102,15420115,563,24920125,661,13620136,351,52520146,027,63220156,438,604
Fiscal YearTaxes
Table 6
Cityof Seward, Alaska
General Fund Tax Revenues by Source
Last Ten Fiscal Years
FiscalPayments-in-Hotel/Motel Tax
YearProperty TaxSales Tax (1)Lieu-of-Tax(2)Other (3) Total
2006847,875$ 3,518,435 77,714 310,570 1,479 4,756,073
2007873,513 4,068,600 76,609 343,162 1,381 5,363,265
2008953,957 4,137,758 80,126 362,004 1,236 5,535,081
2009975,687 3,585,304 84,922 285,313 1,329 4,932,555
3,742,751 75,317 328,396 1,003 5,102,152010954,6874
20111,001,020 4,147,010 78,574 334,824 1,821 5,563,249
20121,013,580 4,189,330 76,160 380,210 1,856 5,661,136
81,670 408,256 1,644 6,351,52520131,276,898 4,583,057
2014986,449 4,535,70 82,4907 421,981 1,005 6,027,632
20151,003,665 4,883,996 88,331 458,605 4,007 6,438,604
1) Sales tax rate has been 4% since July 1, 2003 and one-quarter (1/4) of all sales tax revenue is transferred out of the
General Fund to the Hospital Enterprise Fund to pay healthcare-related debt, capital, and operating costs.
2) The hotel/motel tax rate is 4%.
3) Represents tax-related penalties and interest.
160
Table 7
CityofSeward, Alaska
Property Tax Rates
Direct and Overlapping Governments
Last Ten Fiscal Years
Per $1,000 of Assessed Value)
KPCCFlood Service
Fiscal YearCityBorough (1)(2)(3) Total
20063.126.500.100.5010.22
20073.125.500.000.509.12
20083.124.500.000.508.12
20093.124.500.000.508.12
20103.124.500.000.508.12
20113.124.500.000.508.12
20123.124.500.000.508.12
20133.124.500.000.508.12
20143.124.500.000.508.12
20153.124.500.000.758.37
1) Includes Kenai Peninsula Borough only.
2) Kenai Peninsula Community College.
3) Seward/Bear Creek Flood Service Area created effective 2004.
Source: "Alaska Taxable, 2015"
161
Table 8
City ofSeward, Alaska
Property TaxLevies andCollections
LastTenFiscal Years
Collected in the Fiscal Year of
the LevyTotal Collections to Date
Collections in
FiscalTotal Tax Levy Percentage of Percentage ofSubsequent
Yearfor Fiscal YearAmountLevyAmountLevyYears
2006818,043$ 817,364$ 99.917%652 818,016$ 99.997%
2007847,411 816,305 96.329%31,079 847,384 99.997%
2008919,341 903,535 98.281%15,779 919,314 99.997%
2009948,693 937,198 98.788%11,468 948,666 99.997%
2010966,821 944,796 97.722%559 945,355 97.780%
2011973,756 945,194 97.067%20,773 965,967 99.200%
2012981,134 944,950 96.312%29,603 974,553 99.329%
20131,235,742 1,212,49098.118%18,734 1,231,224 99.634%
2014968,272 942,95297.385%21,572 964,523 99.613%
20151,006,912 978,62997.191%- 978,629 97.191%
Source: Kenai Peninsula Borough
162
Table 9
Assessed ValuetoTotalEst. Actual ValueRatioof3.127.1010.2283.95% 3.126.009.1284.47% 3.125.008.1286.60% 3.125.008.1286.94% 3.125.008.1288.69% 3.125.008.1288.03% 3.125.008.1283.25% 3.125.008.1260.66% 3.125.008.1281.08%3.125.008.1288.91%
Combined Tax
Rate
Overlapping (KPB,
d value $78,000,000 is included above inKPCC & BCFSA)^ Real PropertyPersonal PropertyTotal PropertyTax Rates
Direct (CityofSeward)
Assessed and Estimated Actual Value of Taxable Property
Actual Value313,923,500 329,290,500 338,091,300 347,109,100350,973,40 346,412,90 378,178,10 653,810,30 360,431,50 360,165,60Estimated000000
2013 values include one-time Shell oil rig "Noble Discoverer". Original assessed value of $283,337,326 was appealed; revise1)
City of Seward, Alaska Assessed Value (Kenai Peninsula Borough), but Estimated Actual Value (State of Alaska ) was not downward revised.
Last Ten Fiscal Years
Assessed Value263,528,984 278,152,529 292,802,485 301,784,066311,277,22 304,943,87 314,827,71 *396,612,66 292,232,94 320,218,90IncludesKenaiPeninsulaBorough, Kenai Peninsula Community College and Bear Creek Flood Service Area. 963557
2) 163
Source: State of Alaska "Alaska Taxable 2015" (2) and Kenai Peninsula Borough Certified Tax Roll (1).
Estimated Actual108,717,600 102,716,30093,273,700 102,404,800108,936,20 103,889,20 124,568,80 *405,452,50 110,605,00 109,149,80000000Value (1)
Assessed Value 92,111,31374,203,884 75,020,329 81,943,985 74,492,99681,421,72 77,748,67 168,416,86 79,542,04 80,345,8196559
2)
Actual Value (1) 220,649,800 226,885,700 229,373,700 244,392,800242,037,20 242,523,70 253,609,30 248,357,80 249,826,50 251,015,80000000Estimated
Assessed Value2006189,325,1002007203,132,2002008210,858,5002009227,291,070229,855,502011227,195,202012222,716,402013228,195,80212,690,902015239,873,08000008
2)
FiscalYear 20120104
Table 10 iple tax accounts. Itispossible thatPercentageofPercentageof2006TotalTaxableValue (2) Type of2015AssessedAssessedAssessed18.5% valuations may have been23.0% 81.2% 32.6% 13.3% 41.7% 51.6% 61.5% 71.2% 91.2% 101.1%
Value (1)Rank
Shoreside Petroleum, Inc.Petroleum Products4,045,604Alaska Railroad CorporationTransportation3,210,900Pacific ParkReal Estate/Housing2,930,70032.2%7,925,335 42.1%3,220,100 52.1%6,748,300 62.0%8,769,803 71.6%4,599,4954,126,8943,228,10048,805,231
some taxaccounts may have different names, making it difficult to identify as being owned by thesame entity. Therefore, some
Above assessed values are a best effort to identify ten largest property taxpayers, although values reflect aggregation of mult
1) Includes real and personal property based on 2015 tax rolls. Source: Kenai Peninsula Borough Assessors Department
Total TaxableValue (2)
22.9% 15.5% 23.3% 81.6% 91.3% 101.1%
Compared withNine Years AgoValue (1)RanPrincipalPropertyTaxpayersk
City ofSeward, Alaska
December 31, 2015CiriAlaskaTourismTourism17,528,832Leirer Enterprises, Inc.RealEstate/Leasing10,606,600Carr GottsteinGrocery7,072,400Mindenbergs, JurisHotel/Retail6,879,200SewardHospitality, LLCHotel/Retail6,767,400Icicle/SewardFisheriesSeafood Processing6,359,938GCI, Inc.Communications5,263,803BriceMarine, LLCMarine5,024,803YCSewardHotelGroup, LLCHotel/Retail4,070,600CPDAlaska, LLCPetroleum Products3,617,24173,190,817
2) Based on total assessed value of $263,528,984 in 2006 and $320,218,907 in 2015. 164
Business
Kishan Group, LLCHotel/RetailSewardTerminal, Inc.Coal Export
inadvertently omitted above.
Taxpayer (2)
Total
Table 11
City of Seward, Alaska
PrincipalTaxableSalesbyLineofBusiness
December31, 2015
Percentof CY06Percentof
CY15Taxable TotalTaxable TaxableTotalTaxable
Sales (1)SalesSales (2)SalesTypeofBusiness
Retail Trade47,024,059$ 37.7%36,474,612$ 40.1%
Services (2)2,108,306 1.7%4,357,027 4.8%
Transportation, Communications, Public Utilities1,189,717 1.0%12,732,762 14.0%
Finance, Insurance, Real Estate18,230 0.0%- 0.0%
Construction665,443 0.5%669,187 0.7%
Manufacturing1,065,790 0.9%958,692 1.1%
Agriculture, Forestry, Fisheries9,619 0.0%- 0.0%
Wholesale Trade5,072,923 4.1%5,250,404 5.8%
Guiding Land & Water23,823,855 19.1%- 0.0%
Health Care367,904 0.3%0.0%
Restaurant/Bar14,938,450 12.0%- 0.0%
Hotel/Motel/Bed & Breakfast14,196,814 11.4%18,586,094 20.4%
Public Administration & Education8,195,250 6.6%6,087,059 6.7%
Information2,796,850 2.2%2,676,103 2.9%
Rental Property3,349,276 2.7%1,996,462 2.2%
Other 1.2%1,117,259
100%90,905,661124,822,486$ 100%
1) Source: KenaiPeninsula Borough, Finance Dept, Sales Tax Division
2) Services category isbroken down inmore detail in2015; allblank Types ofBusiness in2006 canbeconsidered "Services".
Note: Information regarding thetenprincipal revenue payers, and theamount collected from each, isnotavailable. The Kenai
Peninsula Borough collects sales taxonbehalf oftheCity ofSeward asrequired byState law. The Borough does notdisclose sales
taxdata byindividual business, even tothecities within theBorough. Rather thanto provide information on thetenprincipal
revenue payers, weareproviding information ontaxable sales byLine of Business.
165
Table 12 Actual TaxableDebtasa % ofProperty (5) Value ofEstimated 14.91% 14.31% 13.49% 13.90% 11.98% 11.37% 11.66% 5.46% 5.54% 6.60%
ough per-capita personal income by Seward population, as Seward- 6,575 6,948 18,948 19,034 17,584 17,620 16,448 17,355 14,810 15,331PrimaryPersonalIncome (3)Debt per Capita (4) TotalGov't
6.4%19.0%2,211 4.9%18.6%1,845 3.7%46.2%1,526 3.9%47.4%1,555 2.7%42.3%1,129 3.2%39.8%1,427 3.1%34.9%1,437 3.1%35.8%1,508 2.7%30.4%1,309 2.5%30.2%1,285Govern- mental
web/portals/4/pub/osa/14taxable.pdf) Debt asa % of TotalPrimaryTotalGov't
ities; per GASB Statement No. 61.
Govern- mental
Total Primary17,135,572 18,251,535 50,420,734 49,658,616 47,355,047 48,156,056 45,298,689 43,162,617 40,993,818 42,007,537Government
5) Estimated Actual Taxable Value data can be found in State of Alaska "Alaska Taxable 2015" (https://www.commerce.alaska.gov/ 3) Source: US Dept. of Commerce, Bureau of Economic Analysis. Personal income is estimated by multiplying Kenai Peninsula BorRatiosofOutstandingDebtbyTypeBeginningin2011, Healthcare Facilities became Business-Type Activities but were previously classified as Governmental Activ3,007,351 3,544,957 3,487,373 2,930,316 2,775,339 1,968,688 1,840,021 4,275,945410,429 2,155,164
LoansCityofSeward, AlaskaLastTenFiscalYears (1)
4) Source: Alaska Department of Commerce, Community & Economic Development Certified Municipal Population.
1) Excludes other than debt instruments (i.e. compensated absences, net pension obligation, inter-fund loans) Capital 166LeasesBusiness-Type Activities (6)
Note: Details regarding the City'soutstanding debt can be found in the notes to the financial statements.
10,175,000 42,645,000 42,000,000 41,325,000 39,930,00010,590,000 38,475,000 37,444,409 35,531,424 34,210,0462) G.O. Bonds represent general obligation bonds pledging the full faith and credit of the City. RevenueBonds
G.O. Bonds (2) 373,854 222,345 169,218 114,124 1,550,000 710,00059,030
specific data unavailable (http://www.bea.gov/iTable/index_regional.cfm)
185,143 109,184 45,777 811,244 614,731 420,717 229,498 31,320CapitalLeases
Governmental Activities (6)
6) Source: City of Seward finance department
RevenueBonds
20065,576,14620074,737,65520084,015,78220093,245,87520102,425,97020113,480,00020123,729,02720133,718,20020143,622,37320153,521,546G.O. Bonds
2) *
FiscalYear
Table 13
City ofSeward, Alaska
Ratio of General Bonded Debt to Assessed Value and
General Bonded Debt per Capita
Last Ten Fiscal Years
General Bonded Debt # ^
Ratio of General
FiscalAssessedBonded Debt to General Bonded
YearPopulation (1)Value (2)GovernmentalBusiness-TypeTotalAssessed ValueDebt per Capita
20062606263,529 5,576 374 5,950 2.26%2,283
20072627278,153 4,738 222 4,960 1.78%1,888
20082661292,802 4,016 169 4,185 1.43%1,573
20092609301,784 3,246 114 3,360 1.11%1,288
20102693 311,277 2,426 59 2,485 0.80% 923
20112733304,944 3,480 1,550 5,030 1.65%1,840
20122754314,828 3,729 710 4,439 1.41%1,612
20132487396,613 *3,718 - 3,718 0.94%1,495
20142768292,233 3,622 - 3,622 1.24%1,309
20152740320,219 3,522 - 3,522 1.10%1,285
Amounts expressed in thousands. Excludes revenue bonds of Business-Type entities.
2013 Assessed Value includes one-time oil property originally assessed at $283,337,326, downward adjusted on appeal to $78,000,000.
Beginning in2011, Healthcare Facilities became Business-Type Activities but were previously classified asGovernmental Activities; per GASB
Statement No. 61. Hospital debt classified as Governmental through 2010, then as Business-Type in 2011 and 2012. Matured 2013.
1) Source: Alaska Department of Commerce, Community & Economic Development Certified Municipal Population.
2) Source: Kenai Peninsula Borough (expressed in thousands).
167
Table 14
City ofSeward, Alaska
Computation ofDirectandOverlapping Bonded Debt
December 31, 2015
Net General Amount
Obligation Percentage Applicable to
Bonded Debt Applicable to City of
JurisdictionOutstandingSewardSeward
Direct:
City of Seward$3,622,373 (1)100%$3,622,373
Overlapping:
Kenai Peninsula Borough (KPB)40,480,000 (2)4.4%(3)1,782,332
44,102,373 $5,404,705
1) Excluding general obligation bonds reported inthe Enterprise Funds. Includes governmental activities' general
obligation bonds, revenue bonds, and capital leases.
2) Source: KPB finance department. Total $44,660,000 less Central Emergency Services unrelated to Seward.
3) Based on ratio of City of Seward assessed value (real and personal property = $320,218,907)
to total assessed value of the Kenai Peninsula Borough ($7,272,753,448)
Source: "2014 Alaska Taxable" p. 50, State of Alaska, and KPB main and supplemental tax rolls.
Note: Excludes State assessed values which are exempt from taxation at City and Borough level.
168
Table 15
City of Seward, Alaska
Legal DebtMargin
December 31, 2015
No debt limit mandated by law.
169
Table 16
City of Seward, Alaska
Revenue Bond Coverage
Electric Enterprise Fund
Last Ten Fiscal Years
Debt Service Requirements (3)
Net Revenue
FiscalGrossOperatingAvailable for
YearRevenues (1)Expenses (2)Debt ServicePrincipalInterestTotalCoverage (4)
20068,246,477$ 7,855,990 390,487 210,000 87,500 297,500 1.31
20078,709,107 6,651,455 2,057,652 195,000 80,938 275,938 7.46
20088,920,730 6,396,886 2,523,844 205,000 175,825 380,825 6.63
20099,173,257 8,589,154 584,103 305,000 367,023 672,023 0.87
20108,903,337 6,854,897 2,048,440 315,000 353,586 668,586 3.06
201110,410,908 8,620,529 1,790,379 330,000 339,298 669,298 2.68
201211,344,047 7,844,098 3,499,949 345,000 323,987 668,987 5.23
201311,139,471 8,531,996 2,607,475 360,000 308,210 668,210 3.90
201411,236,195 8,073,997 3,162,198 380,000 290,053 670,053 4.72
201511,674,228 8,887,162 2,787,066 400,000 273,261 673,261 4.14
1) Total revenues, including interest, exclusive ofgrants.
2) Totaloperating expenses exclusive ofdepreciation andpayments inlieu oftaxes.
3) Includes principal and interest ofrevenue bonds only.
4) Revenue bond agreements require NetRevenue Available forDebt Service beat least 1.30times theamount ofthetotal annual
debt service requirement.
170
Table 17
Cityof Seward, Alaska
Revenue Bond Coverage
Harbor Enterprise Fund
Last Ten Fiscal Years
Debt Service Requirements (3)
Net Revenue
FiscalGross Revenues OperatingAvailable for
Year(1)Expenses (2)Debt ServicePrincipalInterestTotalCoverage (4)
20062,752,802$ 1,388,971 1,363,831 110,000 293,848 403,848 3.38
20072,905,013 1,472,842 1,432,171 310,000 376,504 686,504 2.09
20082,896,828 1,506,685 1,390,143 325,000 374,203 699,203 1.99
20092,632,937 1,903,985 728,952 340,000 356,540 696,540 1.05
20102,850,942 1,784,88 1,066,0557 360,000 337,990 697,990 1.53
20113,017,003 2,040,903 976,100 385,000 318,459 703,459 1.39 *
20123,228,955 2,171,180 1,057,775 400,000 299,765 699,765 1.51
20133,266,821 2,187,206 1,079,615 420,000 284,374 704,374 1.53
20143,257,122 2,358,618 898,504 294,885 179,484 474,369 1.89
20153,396,213 2,289,480 1,106,733 460,000 223,262 683,262 1.62
1) Total revenues, including interest, exclusive of grants.
2) Total operating expenses exclusive of depreciation and payments in lieu of taxes.
3) Includes principal and interest of revenue bonds only.
4) Revenue bond agreements require Net Revenue Available for Debt Service be at least 1.20 times the
amount of the total annual debt service requirement.
Operating Expenses were restated in 2012 for 2011.
Note: 2000 Harbor Enterprise Fund revenue bonds refunded in 2007. Bonds were issued in 2005 in the amount of $1.5 million for
float construction and in 2006 in the amount of $4.5 million for expansion of the south harbor; both of these bonds were refunded
in 2014.
171
Table 18
Unemployment
Rate (4) 39.453,5789,14510.00% 39.751,3509,3898.10% 39.152,3709,3687.60% 39.252,9909,2507.80% 39.252,9909,2569.80% 40.655,4009,1489.50% 40.656,3699,0838.60%41.456,7568,8927.90% 40.056,8628,8327.80% 41.157,7639,1327.80%
For the Kenai Peninsula Borough (A)
eau ofBorough
Enrollment
School 3) Uses Kenai Peninsula Borough Per Capita Personal Income multiplied by Seward population. Source: US Dept of Commerce, Burd2) Source: US Dept of Commerce, Bureau of Economic Analysis for Kenai Peninsula Borough; specific data not available for SewarA) Age and Unemployment data for City of Seward is not available, but is considered comparable to data for the Kenai Peninsula
Age (4)Population (1)
Demographic and Economic Statistics
MedianCityofSeward, AlaskaLastTenFiscalYears
Borough; assumed to be representative of Seward, as specific Seward data unavailable
90,000,18734,536 98,161,73737,366 109,122,27641,008 104,873,60140,197 111,946,23041,569 121,108,45844,313 129,770,94547,121 120,583,22748,485 134,880,29548,728 139,082,61450,760PerCapitaIncome (2) 172Personal
1) Alaska Department of Labor estimates as of July 1of each fiscal year
http://live.laborstats.alaska.gov/labforce/labdata.cfm?s=14&a=0)
Economic Analysis, using annual midyear population estimates. Income (3) Personal
City of Seward
http://www.bea.gov/iTable/index_regional.cfm)
580 577 523 569 549 552 593 574 588 605Enrollment
School
20062,60620072,62720082,66120092,60920102,69320112,73320122,75420132,48720142,76820152,740Population
Fiscal Year
Table19
CityofSeward, Alaska
Principal Employment by Industry - Current and Nine Years Ago
20142006
ResidentResident
IndustryWorkersWorkers
Trade, Transportation and Utilities232256
y154238LeisureandHospitalit
Educational and Health Services121112
Local Government109119
t107138StateGovernmen
Professional and Business Services9032
Manufacturing5049
Construction3544
Other2834
Financial Activities2730
g2533NaturalResourcesandMinin
Information55
9831090
Source: AlaskaDepartmentofLaborandWorkforceDevelopment, Research andAnalysis.
Http://live.laborstats.alaska.gov/alari/
2015dataunavailableduetoa 2-yearlagfromtheDepartmentofLabor
andWorkforce Development. Re-used2014datatocompareto2006.
rBeginningin2012, theStateof Alaskaby statuteprohibitsreleaseofdatarelativetothenumbe
ofemployees workingforanemployer. Norcanitrankemployersaccordingtosize.
Beginningin2014, theCity ofSewardisprovidingEmploymentbyIndustrydatatodemonstrate
thecomparativechangeinemploymentovertimebyIndustryratherthanEmployer.
173
Table 20 CityClerk3.003.003.003.003.002.903.003.203.003.00CityManagerandLegislative3.574.704.063.703.404.104.404.104.004.00M.I.S.2.002.002.002.002.002.002.002.002.502.50Finance7.197.007.127.506.706.907.106.707.007.00Police, Jail, AnimalControl23.1422.5823.1424.1424.6024.9024.2024.3025.5025.50Fire3.003.003.002.502.802.752.802.752.752.75Building Inspection3.003.002.001.941.201.251.201.251.251.25Publi cWorks9.828.506.006.007.006.907.205.905.945.94CommunityDevelopment2.103.303.524.162.701.901.602.002.002.00Maintenance2.002.002.002.002.002.002.002.102.032.03Parks & Recreation14.7814.7814.7914.79158016.0014.2014.9015.2414.10Library4.204.204.504.504.504.604.504.604.594.59Parking3.223.223.153.152.502.302.101.603.293.09Water3.003.003.002.882.702.702.702.603.533.53Wastewater2.002.002.001.882.702.602.502.602.532.53107.54108.57104.99105.85104.90105.60104.40103.50107.80106.46 General Fund Total77.8078.0675.1376.2375.7076.2074.2073.8075.8074.66Harbor and SMIC10.6211.3911.3111.3111.2011.7012.0011.6011.6511.65Electric10.9010.9010.4010.4010.1010.1010.9011.3011.
0011.
00 2006200720082009201020112012201320142015 Full-Time Equivalent Employees
byFundCity ofSeward, Alaska Last Ten
Fiscal
Years 174 Source: City of Seward
finance department TotalAllFunds
Table 21 Physicalarrests305257257290253 300251345289270Traffic violations/warnings1,0101,1871,1871,0841,6331,4661,1291,4001,2252,042Parking violations59404097101 30150792963Number ofcallsanswered(a)179198299293311323307339349376Number onwaitinglistforslips477362287257262206192171183184Number ofboatlifts423417425436477507467551590602General cargotonnage(b)5735826060457920,42127 139.8112Waterservice connections921933928945946950949961958973Sewerserviceconnections8909018989179189229229359349484,86021,632 3,450,054 1,130,528 519,1322,759 54,842,
755
200620072008200920102011201220132014201510,862 2,536,738 1,144,677 519,1322,735 55,190,496 Registered vessels3,1001,6303,3473,5933,5493,3483,60839924,
928Fishproducttonnage12,97221,87316,29912,01820,64713,47117,11924,563Petroleum (gallons)(c)2,691,2972,957,7322,780,7232,349,6952,595,9582,310,6943,934,8062,856,968Dailyaverage consumption gallons)1,300,0001,565,0001,300,0001,300,0001,233,0101,029,0771,580,6411,472,000Dailyaverage treatment (gallons)870,000715,000504,745504,745598,457723,896681,749657,821Numberofserviceconnections2,9013,0893,1123,1673,1943,2243,2182,706Totalkilowatthoursales55,412,94356,228,59056,360,69855,716,46654,683,68157,253,82558,738,00357,950,
087 Operating Indicators by
Function City of Seward, Alaska Last Ten Fiscal
Years
175 Source: Cityof Seward police, fire, harbor, water, wastewater, and finance
departments b) In 2012, includes 20,361tons dredged material removed fromharbor. a) Beginning June 2008, began providingaid responsefor medicalcalls. c) In 2012, includes 1,344,546 gallonsin barrelsthat crossedthe
dock. Waterand WastewaterSystems: Fireand Emergency
Services:
Function Police Services: Electric
System: Public
Safety
Table 22
2222111111112222333352.0052.0052.0053.0053.0054.4054.4054.454.454.8258258265265265265265265265265Fire rating (ISO)4/94/94/94/95/95/95/95/94/94/9Number of fire hydrants217221220220220220220220220220Parks and playgrounds19192020202020202020Electric distribution line (miles)65656565656569696969
2006200720082009201020112012201320142015
Number of fire stations222222Number of police stations111111Libraries111111Sewer treatment plants222222Electric substations333333
Capital AssetStatistics ByFunction
City of Seward, AlaskaLastTenFiscalYears
176
Source: City of Seward fire, public works and finance departments
Number of street lights
Number of FacilitiesLanemilesofstreet
Public Safety
Table 23
Cityof Seward, Alaska
Property Value, Construction (3), and Bank Deposits
Last Ten Fiscal Years
Commercial ConstructionResidential Construction
FiscalTotal Real Property Number of Value of Number of Value of Bank Deposits
YearValue (1)PermitsPermitsPermitsPermits(2)
2006220,649,800 3624,332,857 221,204,392 59,374,764
2007226,885,700 2022,555,446 17589,254 59,042,303
2008229,373,700 14903,500 161,928,879 60,821,068
2009244,392,80 3118,694,2010 24966,926 54,337,541
364,376,321 15941,261 57,426,0002010242,037,200
3610,468,128 27873,920 76,678,6912011242,523,700
2012253,609,30 366,254,6410 18717,400 82,765,489
3014,551,64 22927,616 75,607,192013248,357,80047
2014249,826,50 258,072,21 261,070,400 79,852,00007
2015251,015,80 3016,808,765 11759,860 75,514,0000
1) "Estimated Actual Value" from Table 9.
2) Bank deposit data as of 12/31 through 2014. Beginning 2015, data as of June 30.
3) Source: Construction Data - City of Seward Building Department
177
Table 24
City of Seward, Alaska
Miscellaneous Statistics
December 31, 2015
Date of IncorporationJune 1, 1912
ClassHome Rule City
Form of GovernmentCouncil / Manager
Area, Square Miles22
Miscellaneous Operational Statistics:
Library - number of volumes33,121
Fire Department - Number of volunteers27
Sewer System - Maximum daily capacity (gallons)1,300,000
Water System - Maximum daily capacity (gallons)8,856,000
Electric System:
Miles of distribution lines70
Miles of transmission lines42
Harbor - Number of permanent slips565
City Employees:
Regular Employees - Full-time equivalent95
Temporary Employees - Full-time equivalent11
Demographics:
School Enrollment, City ofSeward (3)605
Unemployment Rate - Borough-Wide (1)7.8%
Population (2)2,740
Per-capita Personal Income (4)50,760
Qualified Voters1,760
Facilities and Services notincluded inthereporting entity:
Education:
Elementary School
Number of students enrolled281
Number of teachers19
Middle School
Number of students enrolled146
Number of teachers10
High School
Number of students enrolled178
Number of teachers13
Alaska Vocational Technical Center
Number of students served annually970
Number of teachers (includes Instructional Aides)32
Healthcare Facilities - acomponent unit ofthereporting entity:
rProvidenceSewardMedical & Care Cente
Number of patient beds (6) combination ofinpatient care & swing beds6
Number of long-term care beds40
Number ofemployees:
Exempt11
Non-Exempt (includes non-staff rotating physicians)112
Peninsula Borough; assumed toberepresentative ofSeward, asspecific Seward data unavailable
http://live.laborstats.alaska.gov/labforce/labdata.cfm?s=14&a=0)
2) Source: Alaska Department of Commerce, Community & Economic Development Certified Municipal Population.
3) State ofAlaska Department of Education & Early Development - https://education.alaska.gov/stats/
4) Source: USDept. of Commerce, Bureau ofEconomic Analysis. Personal income isestimated bymultiplying Kenai Peninsula
Borough per-capita personal income bySeward population, asSeward-specific data unavailable
http://www.bea.gov/iTable/index_regional.cfm)
178
Tel:907-278-88783601 CStreet, Suite600
Fax: 907-278-5779 Anchorage, AK99503
www.bdo.com
Independent Auditor'sReport onInternal Control Over Financial Reporting and
onCompliance and Other Matters Based onanAudit ofFinancial Statements
Performed inAccordance WithGovernment Auditing Standards
Honorable MayorandCityCouncil
Cityof Seward, Alaska
Wehave audited, inaccordance with theauditing standards generally accepted inthe United
GovernmentStatesofAmericaandthestandardsapplicabletofinancialauditscontainedin
Auditing Standardsissued bytheComptroller General oftheUnited States, thefinancial
statements ofthegovernmental activities, thebusiness-typeactivities, each major fund, and the
aggregate remaining fund information ofCity ofSeward, Alaska, asof andfortheyear ended
December 31, 2015, andtherelated notes tothefinancial statements, which collectively comprise
Cityof SewardÔs basic financial statements, andhave issuedour reportthereon dated November
11, 2016. Ourreport includes areference toother auditors whoaudited theoperating account of
the Providence Seward Medical andCare Center, asdescribed inourreport onCityofSewardÔs
financial statements. Theoperating account ofProvidence Seward Medical andCare Centerwas
Government Auditing Standardsnotauditedinaccordancewith , andaccordingly, thisreport does
notinclude reporting oninternal control over financial reporting orinstances ofreportable
noncompliance associated with theoperating account ofProvidence Seward Medical andCare
Center.
Internal ControlOverFinancial Reporting
Inplanning andperforming ouraudit ofthefinancial statements, weconsidered City of
SewardÔs internal control over financial reporting (internal control) to determine theaudit
procedures thatareappropriate in thecircumstances forthepurpose ofexpressing ouropinions
onthe financial statements, butnot forthepurpose ofexpressing an opinion onthe
effectiveness of CityofSewardÔs internal control. Accordingly, wedonotexpress anopinion on
theeffectiveness ofCityofSewardÔs internal control.
deficiency ininternal controlAexists when thedesign oroperation ofacontrol does notallow
management or employees, inthe normal course ofperforming their assigned functions, to
material weaknessprevent, ordetect andcorrect, misstatements onatimely basis. A isa
deficiency, orcombination ofdeficiencies, ininternal control, such thatthereisareasonable
possibility thatamaterial misstatement ofthe entityÔs financial statements willnotbe
significant deficiencyprevented, ordetected andcorrected onatimely basis. A isadeficiency,
oracombination ofdeficiencies, ininternal control that islesssevere than amaterial
weakness, yetimportant enough tomerit attention by those charged with governance.
Our consideration ofinternal control was forthelimited purpose described inthefirst
paragraph ofthis section andwasnotdesigned toidentify alldeficiencies in internal control
that mightbe material weaknesses orsignificant deficiencies. Given these limitations, during
ouraudit wedidnotidentify anydeficiencies ininternal control thatweconsider tobematerial
weaknesses. However material weaknesses may exist that have notbeen identified.
BDO USA, LLP, a Delaware limited liability partnership, is the U.S. member of BDO International Limited, a UK company limited by guarantee, and forms part of the
international BDO network of independent member firms.
BDO is the brand name for the BDO network and for each of the BDO Member Firms.
179
Compliance andOther Matters
Aspartofobtaining reasonable assurance about whether CityofSewardÔs financial statements
arefreefrom material misstatement, weperformed tests ofitscompliance with certain
provisions oflaws, regulations, contracts, andgrant agreements, noncompliance with which
could have adirectand material effect onthedetermination offinancial statement amounts.
However, providing anopinion oncompliance with thoseprovisions wasnotanobjective ofour
audit, andaccordingly, wedonotexpress such an opinion. The resultsofour testsdisclosed no
instances ofnoncompliance orother matters that arerequired tobereported under
Government Auditing Standards.
Purpose ofthisReport
Thepurpose ofthis report issolely todescribe thescope ofourtesting ofinternal control and
compliance andtheresults ofthat testing, andnottoprovide anopinion ontheeffectiveness of
theentityÔs internal control oroncompliance. This report isanintegral part ofanaudit
Government Auditing Standardsperformedinaccordancewithin considering theentityÔs
internal control andcompliance. Accordingly, thiscommunication isnotsuitable foranyother
purpose.
Anchorage, Alaska
November 11, 2016
180
Tel:907-278-88783601 CStreet, Suite600
Fax: 907-278-5779 Anchorage, AK99503
www.bdo.com
Independent Auditor’sReport onCompliance forEach Major Federal Program
andReport on Internal Control Over Compliance Required bytheUniform
Guidance
Honorable MayorandCityCouncil
Cityof Seward, Alaska
Report onCompliance forEachMajorFederal Program
We have audited City ofSewardÔs compliance with thetypes ofcompliance requirements
OMBCompliance Supplementdescribedinthethatcould have adirect andmaterial effect on
each ofCityofSewardÔs major federal programs fortheyear ended December 31, 2015. City of
SewardÔs major federalprograms areidentified inthesummary ofauditorÔs results section of
theaccompanying schedule offindings andquestioned costs.
Management’sResponsibility
Management isresponsible for compliance withfederal statutes, regulations, andtheterms and
conditions ofitsfederal awards applicable toits federal programs.
Auditor’sResponsibility
Ourresponsibility istoexpress anopinion oncompliance foreach ofCity ofSewardÔs major
federal programs based onouraudit ofthetypesofcompliance requirements referred toabove.
Weconducted ouraudit ofcompliance inaccordance with auditing standards generally
accepted intheUnitedStates ofAmerica; thestandards applicable tofinancial audits contained
Government Auditing Standardsin , issued by theComptroller General oftheUnited States; and
Code ofFederal RegulationsUniformtheauditrequirementsofTitle2U.S. Part 200,
Administrative Requirements, CostPrinciples, andAudit Requirements forFederalAwards
Uniform Guidance). Those standards andtheUniform Guidance require that weplan and
perform theaudit to obtain reasonable assurance about whether noncompliance with thetypes
ofcompliance requirements referred toabove thatcould have adirect andmaterial effect ona
major federalprogram occurred. Anauditincludes examining, onatestbasis, evidence about
Cityof SewardÔs compliance withthose requirements andperforming suchother procedures as
we considered necessary inthecircumstances.
Webelieve thatouraudit provides areasonable basis forouropinion oncompliance foreach
major federal program. However, ouraudit does notprovide alegal determination ofCityof
SewardÔs compliance.
BDO USA, LLP, a Delaware limited liability partnership, is the U.S. member of BDO International Limited, a UK company limited by guarantee, and forms part of
the international BDO network of independent member firms.
BDO is the brand name for the BDO network and for each of the BDO Member Firms.
181
Opinion onEach MajorFederal Program
Inouropinion, CityofSeward complied, inallmaterial respects, withthetypes ofcompliance
requirements referred toabove thatcouldhave adirect andmaterial effect oneach ofits
major federalprograms for theyearended December 31, 2015.
Report onInternal Control OverCompliance
Management of CityofSeward isresponsible forestablishing andmaintaining effective internal
control over compliance with the typesofcompliance requirements referred to above. In
planning andperforming ouraudit ofcompliance, weconsidered City of SewardÔs internal
control over compliance with the types ofrequirements thatcould have adirect andmaterial
effect on each major federal program todetermine theauditing procedures that are
appropriate inthecircumstances forthepurpose ofexpressing anopinion oncompliance for
each major federal program andtotestandreport oninternal control over compliance in
accordance withtheUniform Guidance, butnotforthepurpose ofexpressing anopinion onthe
effectiveness ofinternal control over compliance. Accordingly, wedonotexpress anopinion on
theeffectiveness ofCityofSewardÔs internal control over compliance.
deficiency ininternal control over complianceAexists when thedesign or operation ofa
control over compliance does not allow management oremployees, inthenormal course of
performing their assigned functions, toprevent, ordetect andcorrect, noncompliance with a
material weakness intypeofcompliancerequirementofafederalprogramonatimelybasis. A
internal controlover complianceisadeficiency, orcombination ofdeficiencies, ininternal
control overcompliance, such thatthere isareasonable possibility thatmaterial noncompliance
with atypeofcompliance requirement ofafederal program willnotbeprevented, ordetected
significant deficiency ininternal control overcomplianceandcorrected, on atimely basis. A is
adeficiency, oracombination ofdeficiencies, ininternal control overcompliance with atype
ofcompliance requirement ofafederal program thatislesssevere thanamaterial weakness in
internal control over compliance, yetimportant enough to merit attention by those charged
with governance.
Ourconsideration of internal control over compliance wasfor thelimited purpose described in
thefirst paragraph ofthissection andwasnotdesigned to identify alldeficiencies ininternal
control over compliance thatmight bematerial weaknesses orsignificant deficiencies. Wedid
notidentify anydeficiencies ininternal control over compliance thatweconsider tobematerial
weaknesses. However, material weaknesses may exist that have notbeen identified.
Thepurpose ofthisreport oninternal control overcompliance issolely todescribe thescope of
ourtesting ofinternal control over compliance and theresults ofthattesting basedon the
requirements oftheUniform Guidance. Accordingly, thisreport isnotsuitable foranyother
purpose.
Anchorage, Alaska
November 11, 2016
182
Tel:907-278-88783601 CStreet, Suite600
Fax: 907-278-5779 Anchorage, AK99503
www.bdo.com
Independent Auditor’sReport onCompliance forEach MajorState Program and
Report onInternal Control OverCompliance Required bytheState ofAlaska
Audit Guide andCompliance Supplement forState Single Audits
Honorable MayorandCityCouncil
Cityof Seward, Alaska
Report onCompliance for EachMajorStateProgram
Wehaveaudited CityofSewardÔs compliance with thetypes ofcompliance requirements described
StateofAlaska Audit Guideand Compliance Supplement forStateSingleAuditsinthethatcould
have adirectand material effect oneach of CityofSewardÔs major stateprograms fortheyear
ended December 31, 2015. City ofSewardÔs major state programs areidentified inthe
accompanying Schedule ofState Financial Assistance.
Management’sResponsibility
Management isresponsible forcompliance withtherequirements oflaws, regulations, contracts,
and grantsapplicable to itsstate programs.
Auditor’sResponsibility
Ourresponsibility istoexpress anopinion oncompliance foreach ofCityofSewardÔs major
state programs based onouraudit ofthetypes ofcompliance requirements referred toabove.
Weconducted ouraudit ofcompliance inaccordance with auditing standards generally
accepted intheUnitedStates ofAmerica; thestandards applicable tofinancial audits contained
Government Auditing Standardsin , issued bythe Comptroller General ofthe United States; and
State ofAlaska Audit GuideandCompliance Supplement forStatetheauditrequirementsofthe
SingleAudits StateofAlaska AuditGuideandCompliance SupplementThosestandardsandthe
forState Single Auditsrequire thatwe planandperform theaudit toobtain reasonable
assurance about whether noncompliance with thetypes ofcompliance requirements referred to
above thatcould have adirect andmaterial effect onamajorstate program occurred. An audit
includes examining, onatest basis, evidence about Cityof SewardÔs compliance with those
requirements andperforming such other procedures as weconsidered necessary inthe
circumstances.
Webelieve thatouraudit provides areasonable basis for ouropinion oncompliance for each
major state program. However, ouraudit does notprovide alegal determination ofCity of
SewardÔs compliance.
Opinion onEachMajor State Program
In ouropinion, CityofSeward complied, inallmaterial respects, with thetypesof compliance
requirements referred toabove thatcould have adirectandmaterial effect oneach of itsmajor
state programs fortheyearended December 31, 2015.
BDO USA, LLP, a Delaware limited liability partnership, is the U.S. member of BDO International Limited, a UK company limited by guarantee, and forms part of the
international BDO network of independent member firms.
BDO is the brand name for the BDO network and for each of the BDO Member Firms.
183
Report onInternal Control OverCompliance
Management of CityofSeward isresponsible forestablishing andmaintaining effective internal
control overcompliance withthetypes ofcompliance requirements referred toabove. Inplanning
and performing ouraudit ofcompliance, weconsidered CityofSewardÔs internal control over
compliance with thetypes ofrequirements thatcouldhave adirect and material effect oneach
major stateprogram todetermine theauditing procedures thatare appropriate in the
circumstances forthe purpose ofexpressing an opinion oncompliance foreach major state
Stateprogramandtotestandreportoninternalcontrolovercomplianceinaccordancewiththe
ofAlaska AuditGuideandCompliance Supplement forState SingleAudits, butnotforthepurpose
ofexpressing anopinion ontheeffectiveness ofinternal control overcompliance. Accordingly, we
donotexpress anopinion on theeffectiveness ofCity ofSewardÔs internal control over
compliance.
deficiency ininternal control over complianceAexists when thedesign or operation ofa
control over compliance does notallow management oremployees, inthenormal course of
performing their assigned functions, toprevent, ordetect andcorrect, noncompliance with a
material weakness intypeofcompliancerequirementofastateprogramonatimelybasis. A
internal controlover complianceisadeficiency, orcombination ofdeficiencies, ininternal
control over compliance, such thatthere isareasonable possibility thatmaterial noncompliance
with atype ofcompliance requirement ofastate program will notbeprevented, ordetected
significant deficiency ininternal control overcomplianceandcorrected, on atimely basis. A is
adeficiency, oracombination ofdeficiencies, ininternal control overcompliance with atype
ofcompliance requirement ofastate program thatislesssevere than amaterial weakness in
internal control over compliance, yetimportant enough to merit attention by those charged
with governance.
Ourconsideration of internal control over compliance wasfor thelimited purpose described in
thefirst paragraph ofthissection andwasnotdesigned to identify alldeficiencies ininternal
control over compliance thatmight bematerial weaknesses orsignificant deficiencies. Wedid
notidentify anydeficiencies ininternal control thatweconsider tobematerial weaknesses.
However, material weaknesses mayexist that have notbeen identified.
Thepurpose ofthisreport oninternal control overcompliance issolely todescribe thescope of
ourtesting ofinternal control over compliance and theresults ofthattesting basedon the
StateofAlaska AuditGuide andCompliance Supplement forStateSinglerequirementsofthe
AuditsAccordingly, thisreport isnotsuitable foranyotherpurpose.
Anchorage, Alaska
November 11, 2016
184
City of Seward, Alaska
Schedule ofFindings andQuestioned Costs
YearEnded December 31, 2015
Section I -Summary ofAuditor’sResults
Financial Statements
Type of auditorÔs report issued: Unmodified
Internal control over financial reporting:
Material weakness(es) identified? yesX no
Significant deficiency(ies) identified?yesX none reported
Noncompliance material tofinancial statements noted?yesX no
Federal wardsA
Internal control over major federal programs:
Material weakness(es) identified? yesX no
Significant deficiency(ies) identified?yesX none reported
Type ofauditorÔs reportissued oncompliance for
major federal programs: Unmodified
Anyaudit findings disclosed thatarerequired tobereported
inaccordance with 2CFR 200.516(a)? yes Xno
Identification of major federal programs:
CFDA Number Name of Federal Program or ClusterAgency
93.224 HRSA Health Care ClusteDepartment ofHealth andr
Human Services
Dollar threshold used todistinguish between aType Aand Type Bprograms: $750,000
Auditee qualified aslow-risk auditee?Xyes no
StateFinancial Assistance
Type ofauditorÔs report issued oncompliance formajor
state programs: Unmodified
Internal control over major state programs:
Material weakness(es) identified? yesX no
Significant deficiency(ies) identified?yesX none reported
Dollar threshold used todistinguish astate major program:$100,000
185
City of Seward, Alaska
Schedule ofFindingsandQuestioned Costs, continued
YearEnded December 31, 2015
Section II - Financial Statement Findings Required tobeReported inAccordance with
Government AuditingStandards
There were nofinancial statement findings required tobereported inaccordance with
Government Auditing Standards
Section III - FederalAward Findings andQuestioned Costs
There were nofindings and questioned costsforfederal awards (as defined in2CFR 200.516(a))
thatarerequired tobereported.
Section IV – StateAward FindingsandQuestioned Costs
There were noState award findings andquestioned costs required tobereported inaccordance
StateofAlaska AuditGuideandCompliance Supplement forStateSingle Auditswiththe .
186
City ofSewardSingle AuditResponses (Unaudited)
187