Loading...
HomeMy WebLinkAboutIntroductorySection2007CAFR CITY OF AUBURN WASHINGTON COMPREHENSIVE ANNUAL FINANCIAL REPORT Fiscal Year January 1, 2007 through December 31, 2007 * ~_ ....._ * J AlikuRN * ~ ...--= - WASHINGTON Prepared by Finance Department Shelley Coleman, Finance Director * * * * * MORE THAN YOU IMAGINED CITY OF AUBURN: 2007 CAFR TABLE OF CONTENTS COMPREHENSIVE ANNUAL FINANCIAL REPORT For the Year Ended December 31,2007 TABLE OF CONTENTS Page I. INTRODUCTORY SECTION Title Page Table of Contents............................................................................................................................ i City Officials..................................................................................................................................... 1 Organizational Chart (City and Council Committees)......................................................................2 Letter of Transmittal......................................................................................................................... 3 Certificate of Achievement..............................................................................................................11 II. FINANCIAL SECTION Auditor's Report.............................................................................................................................. 13 Management's Discussion and Analysis ........................................................................................15 Basic Financial Statements Government-wide Financial Statements: Statement of Net Assets.................................................................................................... 35 Statement of Activities....................................................................................................... 36 Fund Financial Statements: Balance Sheet - Governmental Funds.............................................................................. 39 Statement of Revenues, Expenses and Changes in Fund Balance - Governmental Funds.............................................................................40 Reconciliation of the Statement of Revenues, Expenditures, and Changes in Fund Balances of Government Funds to the Statement of Activities..............................41 Statement of Net Assets - Proprietary Funds ...................................................................44 Statement of Revenues, Expenses, and Changes in Fund Net Assets - Proprietary Funds .............................................................................45 Statement of Cash Flows - Proprietary Funds..................................................................46 Statement of Fiduciary Net Assets - Fiduciary Funds ......................................................49 Statement of Changes in Fiduciary Net Assets - Fiduciary Funds ...................................50 Notes to the Financial Statements........................................................................................51 Required Supplemental Information: Schedule of Revenues, Expenses and Changes in Fund Balance - Budget and Actual: General Fund..................................................................................................................... 87 Arterial Street Fund............................................................................................................ 88 Combining and Individual Fund Financial Statements and Schedules: Combining Balance Sheet - Non-Major Government Funds ...............................................90 Combining Statement of Revenues, Expenditures, and Changes in Fund Balances - Non-Major Government Funds............................................................91 Combining Balance Sheet - Non-Major Special Revenue Funds ........................................94 Combining Statement of Revenues, Expenditures, and Changes in Fund Balances - Non-Major Special Revenue Funds ....................................................96 Schedules of Revenues, Expenditures, and Changes in Fund Balances - Budget and Actual: Local Street Special Revenue Fund ..................................................................................98 Hotel/Motel Tax Special Revenue Fund ............................................................................99 CITY OF AUBURN: 2007 CAFR TABLE OF CONTENTS Schedules of Revenues, Expenditures, and Changes in Fund Balances - Budget and Actual: (continued) Page Drug Forfeiture Special Revenue Fund ............................................................................100 Local Law Enforcement Grant Special Revenue Fund ....................................................101 Housing & Community Development Special Revenue Fund.......................................... 102 Recreation Trails Special Revenue Fund ......................................................................... 103 Business Improvement Area Special Revenue Fund....................................................... 104 Cumulative Reserve Special Revenue Fund.................................................................... 105 Mitigation Special Revenue Fund..................................................................................... 106 Special Parks and Recreation Special Revenue Fund ....................................................107 Combining Balance Sheet - Debt Service Funds................................................................... 110 Combining Statement of Revenues, Expenditures, and Changes in Fund Balance - Non-Major Debt Service Funds.............................................................. 111 Balance Sheet - Capital Project Fund .................................................................................... 113 Statement of Revenues, Expenditures, and Changes in Fund Balances - Capital Project Fund .............................................................................114 Balance Sheet - Permanent Fund .......................................................................................... 116 Statement of Revenues, Expenditures and Changes in Fund Balance - Permanent Fund............................................................................................................... 117 Combining Statement of Net Assets - Non-Major Enterprise Funds .....................................119 Combining Statement of Revenues, Expenses, and Changes in Fund Net Assets - Non-Major Enterprise Funds....................................................................... 120 Combining Statement of Cash Flows - Non-Major Enterprise Funds .................................... 121 Combining Statements of Net Assets -Internal Service Funds............................................. 124 Combining Statement of Revenues, Expenses, and Changes in Fund Net Assets -Internal Service Funds....................................................................... 125 Combining Statement of Cash Flows - Internal Service Funds .............................................126 Statement of Changes in Assets and Liabilities - Agency Fund ............................................129 III. STATISTICAL SECTION Schedule Net Assets by Component..............................................................................................1 ............ 132 Changes in Net Assets ...................................................................................................2 ............133 Fund Balances, Government Funds...............................................................................3 ............134 Changes in Fund Balances, Government Funds ...........................................................4 ............135 Tax Revenues by Source, Government Funds ..............................................................5............136 Assessed Value by Type ................................................................................................6 ............ 137 Property Tax Data...........................................................................................................7............138 Property Tax Levies and Collections.............................................................................. 8 ............140 Principal Taxpayers - Property Taxes ...........................................................................9 ............141 Retail Tax Collections by Sector...................................................................................1 0............ 142 Ratios of Outstanding Debt by Type.............................................................................11 ............143 Computation of Legal Debt Margin ...............................................................................12............ 144 Legal Debt Margin Ratios .............................................................................................13 ............144 Computation of Net Direct and Estimated Overlapping Debt.......................................14 ............145 Ratio of Net General Bonded Debt to Assessed Value................................................ 15 ............ 146 Pledged Revenue Bond Coverages .............................................................................16............147 Population, Income and Housing Trends .....................................................................17 ............148 Major Employers........................................................................................................... 18 ............ 149 Staffing Levels by Department .....................................................................................19 ............150 Operating Indicators by Department ............................................................................20............151 Capital Asset Indicators by Department .......................................................................21 ............ 152 11 J' //' ~--1 ~,\ ~ CITY COUNCIL ,.. ,. Nancy Backus Gene Cerino CITY OFFICIALS MAYOR Pete Lewis Lynn Norman Bill Peloza Sue Singer Virginia Haugen DEPARTMENT HEADS Finance Director City Attorney Director of Human Resources & Risk Management Information Services Parks Director Planning Director Police Chief Public Works Director Shelley Coleman Dan Heid Brenda Heineman Lorrie Rempher Daryl Faber Cindy Baker Jim Kelly Dennis Dowdy Rich Wagner CITY OF AUBURN: 2007 CAFR ORGANIZATION CITIZENS JUDGE Patrick Burns MAYOR Pete Lewis CITY COUNCIL PARKS & RECREATION Daryl Faber PLANNING Cindy Baker POLICE Jim Kelly FINANCE Shelley Coleman HUMAN RESOURCES Brenda Heineman INFORMATION SERVICES Lorrie Rempher LEGAL Dan Heid COUNCIL COMMITTEES FINANCE COMMITTEE Nancy Backus, Chairperson Sue Singer Bill Peloza MUNICIPAL SERVICES Gene Cerino, Chairperson Bill Peloza Lynn Norman PLANNING & COMMUNITY DEVELOPMENT Lynn Norman, Chairperson Nancy Backus Rich Wagner PUBLIC WORKS Rich Wagner, Chairperson Gene Cerino Virginia Haugen 2 CITYOF_ * ~ Ai;!:RB-ltN r---7 WASHINGTON Peter B. Lewis, Mayor 25 West Main Street * Auburn WA 98001-4998 * www.ci.auburn.wa.us * 253-931-3000 June 24, 2008 Honorable Peter Lewis, Mayor Members of the Auburn City Council Citizens of the City of Auburn 25 W Main Street Auburn, WA 98001 State law requires that cities publish financial statements in conformity with Generally Accepted Accounting Principles (GAAP), which are audited in accordance with generally accepted auditing standards by the State Auditor's Office, under the Revised Code of Washington (RCW) 43.09.230. Therefore, we issue and transmit to you the City of Auburn's Comprehensive Annual Financial Report (CAFR) for the fiscal year ended December 31,2007. This transmittal letter provides an overview of the report and the financial condition of the City. It also provides insight into the history of the City and the economic conditions affecting it, and describes the systems and controls employed by the Finance department. The Comprehensive Annual Financial Report has several significant uses. First, it provides a general overview of the City's finances to the general public and taxpayers. Second, it is referenced by bond buyers and rating agencies to evaluate the City's fiscal stability and creditworthiness. Finally, the CAFR is a series of financial statements that have been audited by the State Auditor's Office and provides assurances that assets are safeguarded and funds are expended as they were legally appropriated in the biennial budget. I. INTRODUCTION A. MANAGEMENT REPRESENTATION The Auburn Finance Department prepared the report and accepts complete responsibility for the accuracy, completeness, and fairness of presentation of the information included. The data is believed to be accurate in all material respects, and it is believed that all significant information necessary for an understanding of the affairs and financial condition of the City has been disclosed. The report has been prepared in conformance with GAAP and in conformance with financial reporting standards issued by the Governmental Accounting Standards Board (GASB). City management has developed and evaluated a comprehensive internal control structure that is designed to protect the City's assets from loss, theft, or misuse and to compile sufficient reliable information for the preparation of the City's financial statements in conformity with GAAP. Because the cost of internal controls should not outweigh the benefits, the City's internal control structure is designed to provide reasonable, rather than absolute, assurance that the financial statements will be free from material misstatement. As management, we attest that, to the best of our knowledge and belief, this financial report is complete and reliable in all material aspects. 3 AUBURN", MORE THAN YOU IMAGINED CITY OF AUBURN: 2007 CAFR LETTER OF TRANSMITTAL As a recipient of federal, state and county financial assistance the City is required to undergo an annual single audit in conformity with U.S. Office of Management and Budget Circular A-133, Audits of State and Local Governments. The audit is conducted by the State Auditor's Office in conjunction with the City's annual independent audit. The results of the City's annual single audit for the fiscal year ended December 31, 2007 provided no instances of material weakness in the internal control structure or significant violations of applicable laws. GAAP requires that management provide a narrative introduction, overview and analysis to accompany the basic financial statements in the form of Management's Discussion and Analysis (MD&A). This letter of transmittal is designed to complement the MD&A and should be read in conjunction with it. Auburn's MD&A can be found immediately following the independent auditor's report. B. ORGANIZATION OF THE REPORT The report is divided into three sections: the Introductory Section, the Financial Section, and the Statistical Section. The Introductory Section contains the table of contents, a list of the City's principal officials, an organizational chart, this letter of transmittal, and the Certificate of Achievement for Excellence in Financial Reporting from the Government Finance Officers' Association of the United States and Canada for the 2006 CAFR. The Financial Section contains the Washington State Auditor's Report, completed by the Washington State Auditor, Management's Discussion and Analysis, Government-Wide Financial Statements, the Fund Financial Statements, Notes to the Financial Statements and Other Required Combining and Supplemental Information. The Statistical Section, which is unaudited, contains a range of statistical tables and charts that present various financial, economic, social, and demographic data about the City. This information depicts various trends that have affected the fiscal condition of the City over the last ten years. The data presented in this section complies with the requirements of GASB Statement No. 44, Economic Condition Reporting: The Statistical Section. C. REPORTING ENTITY The City of Auburn was incorporated in 1891 and currently operates as a non-charter Code City under the laws of the State of Washington. Code City status in Washington provides "home rule" authority to cities. Auburn has a Mayor/Council form of government, and the Mayor is elected and is the full-time Chief Administrator. The seven-member City Council are elected at large, rather than by district. Members of the City Council are responsible for establishing the general direction and policies for the City and for providing the resources necessary to carry out those policies. As the City's chief administrator, the Mayor is responsible for carrying out the policy and direction set by the City Council. This includes the enforcement of laws and ordinances, the execution of contracts and agreements, and maintenance of peace and order in the city. The City is located primarily in southern King County (county seat, Seattle) and a small northeastern portion of Pierce County. These are the two most populous counties in the State of Washington, comprising over 40% of the population. The City is strategically located in relation to the labor and consumer markets of the two largest cities in the area: Seattle in King County and Tacoma in Pierce County. Auburn currently serves approximately 50,000 people within its incorporated limits. The City provides a wide range of services, both beneficial and necessary, to its residents as well as to the adjacent area. These services include police protection; parks and recreational facilities that include a senior center, golf course and museum; land use management and development regulation; infrastructure construction and maintenance; water, sanitary sewage collection, storm drainage, and solid waste services; a general aviation airport; and a municipal 4 CITY OF AUBURN: 2007 CAFR LETTER OF TRANSMITTAL cemetery. The City also has a municipal court and jail facilities that provide services to other governmental agencies through interlocal agreements. II. ECONOMIC CONDITION A. SUMMARY OF LOCAL ECONOMY Auburn began as a small rural community based on agriculture and the railroad, which maintained a significant switching and repair facility. The City has grown significantly since World War II, both as a residential community and as a commercial and industrial area. Auburn has become a significant area for automobile sales and has also developed a significant manufacturing and distribution base with the largest employer being The Boeing Co., which employs over 4,000 people in its Auburn facility. Boeing is a worldwide supplier of aircraft and related products. The City's assessed valuation in 2007, for 2008 property tax collection, was $6,526,294,998. Auburn has enjoyed steady residential and industrial growth over the years as development has moved outward from the major cities. The City currently has a growing array of manufacturing facilities, as well as distribution, wholesaling, and retailing operations. Auburn Regional Medical Center, located in Auburn, serves the local geographic area and is a major trauma center of the northwest. The medical center has purchased land on which to construct an oncology center and parking garage. Auburn also has a significant retailing base, and in addition to maintaining its downtown core businesses, has attracted significant retailers who have constructed major new facilities in Auburn in recent years. The SuperMall of the Great Northwest has increased the retail base along with adjacent mall development which has only a few prime sites left available for new construction. Developments that have taken place over past years include a 17-screen movie theater, WalMart, Sams Club and restaurants. Auburn has also been a center for automobile sales for a number of years, drawing customers from a wide area. Since 1998 the City's total assessed property valuation has more than doubled from $3.0 to over $6.5 billion. The sales tax receipts went from $11.0 to $19.0 million in the same time period. This is at the same time the State changed the tax structure of Washington to exempt sales tax on research and manufacturing activities. This one change eliminated over $700,000 of the City's sales tax base in one year. The City had to generate opportunities for businesses to help the City offset this significant loss. Recent sales tax increases have been largely due to retail and auto sales. Since the recession several years ago, the economic climate has steadily strengthened. Construction permits and Real Estate Excise Tax revenue over the past few years have been robust. Many City projects are in the planning stages including creation of the Auburn Environmental Park. The City has acquired property in the planned area and has received small amounts of grant funding. This revitalization trend is positive for the aging downtown core and it is anticipated that these efforts will continue. Residential construction continues in the southeast section of Auburn and developments are planned for the north end as well. With annexation of Lea Hill and West Hill January 1, 2008, the City increased staffing beginning in late 2007 to serve these new residents. The Boeing Company's layoffs and divestiture in the Puget Sound area have had an effect on the regional and local economy. Boeing has reduced approximately 57% of its jobs in Auburn. The Boeing downsizing operation is leading to a new economic growth cycle in Auburn as available property and the adjacent land open up development opportunities for other businesses. These new businesses are relocating to Auburn by using property vacated by the 5 CITY OF AUBURN: 2007 CAFR LETTER OF TRANSMITTAL Boeing Company. There are several other businesses negotiating with Boeing to take over existing facilities or purchase land and move their operations to Auburn. In the long term, the City will benefit from the economic diversity. Another factor strengthening the local economy during the last ten years was the addition of Emerald Downs a major thoroughbred horseracing facility in Auburn, to replace Longacres - the area's former racing facility located in Renton, Washington. The addition of the Thoroughbred Breeders Association headquarters was completed in 1998. Emerald Downs also provides facilities for meetings, banquets and seminars. A major gambling facility is located on the Muckleshoot Indian Reservation in Auburn. In 1999, 2004 and again in 2006, the facility was expanded for additional gambling which includes a non-smoking facility, entertainment, and the addition of a 24-hour family restaurant. The casino recently completed construction of a five- story parking garage to accommodate casino growth and increased numbers of patrons. The Tribe is in the planning stages at this time for further expansion of the facility in the near future. The Tribe also opened the White River Amphitheater, a 25,000 seat outdoor facility in 2003. The total impact of these facilities on the City is not fully known at this time but there has been an increased demand for public safety, and has had a large transportation impact, as the main arterial accessing these sites goes directly through the City. Despite economic cycles, the City has continually focused on enhancing the quality of life in the community. In recent years, through strategically placed bond issues, successes in grant procurements, and conservative operations, parks have been expanded, streets improved, commercial and residential sidewalks have been upgraded, and buildings advantageously renovated to house a new senior center and parks department. In 1997, the voters elected to annex to the King County Library System. The System completed construction of a new library in the City early in 2000. In 2001, the City renovated the former library building into a new Senior Center at the Les Gove Park campus. In 2003, the City was successful in negotiating the purchase of the YMCA building located on this campus with the vision of it being renovated into a community center in the future. The campus currently hosts the Library, White River Valley Museum, Parks and Recreation department and Senior Center. The City's budgeting process is based on financial policies directed at conserving fiscal resources while supporting programmatic strategies. Budget recommendations reflect a long- range analysis of fiscal trends. These policies and practices have not only averted serious funding problems in the past, particularly in the recent recession years of 2001 and 2002, but have maintained the General fund on a firm financial basis and allowed carefully planned enhancements in services. The City is currently in stable financial condition. All funds contain adequate balances, and the City's debt is manageable. The General and Cumulative Reserve funds contain satisfactory balances, a significant Insurance fund has been set aside for contingencies, and the Equipment Rental fund is adequate for vehicle replacement. The Proprietary and Fiduciary funds are generally in satisfactory condition and have adequate balances for their purposes. The Water fund has been under some economic pressure due to an aggressive capital program to meet federal and state requirements. Rates were increased during 2005 and again in 2007. All rate increases were applied as a result of a cost-of-service study. A cost-of-service study was updated for the Sanitary Sewer fund and rates increased in January 2001, 2002, 2005, 2007 and 2008 to ensure the ongoing operational health of the fund. The City completed a cost-of-service study for the Storm Drainage fund in 2004 and new rates went into effect early 2005 and 2007. B. FUTURE ECONOMIC OUTLOOK Auburn is in a continuous process of both short-term and long-term financial planning. Short- term financial planning is inherent in the development of the City's biennial budget. Concurrent with the biennial budget is the City's long-term capital needs and potential funding is assessed 6 CITY OF AUBURN: 2007 CAFR LETTER OF TRANSMITTAL with the development of the six-year capital facility plan. The capital facility plan is a component of the Comprehensive Master Plan, which outlines how the City should look and function in twenty years and creates a vision that can be realistically implemented. An integral part of this vision is determining how to allocate the City's financial resources to achieve the desired goals. The City has several long-term planning and capital projects underway. Reconstruction of Auburn Way South is under construction in conjunction with safety improvements, sewer line placement and the Intelligent Traffic System (ITS). The ITS project will allow the City to program and monitor intersections from a central location on this highly traveled corridor. A master plan for the Les Gove Park Campus, which will house a community center in the future, is underway for this centrally located park. The Pierce County area of the City continues to grow through the development of new single and multifamily housing in Lakeland Hills. Sorrento and Sienna town homes, Palermo apartments and Pinnacle single-family homes are some of the newest developments with more in the planning stages. Growth is predicted to continue, but not at the rate experienced in the late 1990's. The challenge is to control costs that grow at a faster rate than revenue. Areas of concern are health care costs and public safety costs related to incarceration and labor contracts. Continuing to fund these sectors will draw valuable resources from other areas such as infrastructure replacement and capital programs. As Auburn moves forward, economic conditions will be continually monitored and adjustments to city spending and services made to maintain the City's financial health. Long-term plans will be focused on ensuring the City continues to be an economically strong and viable city. III. FINANCIAL INFORMA TION A. CASH MANAGEMENT The City invests in U.S. Treasury and Agency Issues, Prime Bankers Acceptances, Time Deposits, and Repurchase Agreements. Investment policies and procedures, established by the Mayor and adopted by the City Council, require the City to establish a trustee to take delivery of all investment transactions at time of payment. The City has contracted with the Bank of New York to provide delivery versus payment trustee services on all government agency investments. The State of Washington maintains an investment pool to provide economies of scale in investing to smaller- and medium-sized cities in the State. The City uses this service for all funds not invested in longer-term securities. The pool operates under the same legal restrictions that apply to all municipalities in the State and, consequently, uses the same instruments as listed above. The State also takes delivery of all investment transactions. The City has adopted a comprehensive investment policy statement to guide City investment practices. These policies are closely patterned after the recommendations in Investing Public Funds published by the Government Finance Officer's Association (GFOA). Investments are restricted to less than three years in order to maintain liquidity on all investments in all funds, yet enable the City to take advantage of the yield curve. Fiduciary funds, which involve long-term reserves and require minimal liquidity, are invested for longer time periods. The City undertakes repurchase agreements only with financial institutions that offer the City full protection in the event of default, by providing the delivery of the underlying security to the City. During 2007, the City applied for, and received in 2008, the Certification of Excellence Award from the Association of Public Treasurers of the United States and Canada on this policy. 7 CITY OF AUBURN: 2007 CAFR LETTER OF TRANSMITTAL B. RISK MANAGEMENT 1. Types and Level of Risk Assumed The City participates in the Washington Cities' Insurance Authority (an insurance pool of over 100 cities). The City actively pursues risk reduction in the operation of its programs. The City purchases, with employee participation, most of its health insurance for its employees through commercial policies administered by the Association of Washington Cities. Employees represented by the Teamsters Union have insurance through the Teamsters organization. The City participates in the Washington State Workers' Compensation program. In order to keep its long-term options open and to provide for any uninsured losses that might occur, the City has elected to build an insurance reserve (the Insurance fund). The Insurance fund supplements various insurance coverages maintained by the City. This fund is also used to self-insure some limited exposures, the most significant of which is accidental loss to City-owned vehicles. 2. Risk Control Policies The Washington Cities' Insurance Authority not only provides a sharing of risk by pooling of losses, it also provides an extensive array of professional services in risk management. The pool monitors the City's management practices and damage claims. The City follows the guidelines provided by the pool in an effort to minimize risk exposure in the day-to-day operations of the City's programs. The City also maintains an extensive employee safety program managed by the Human Resources department. IV. OTHER RELEVANT INFORMATION A. INDEPENDENT AUDIT State law requires an annual audit of all City books of accounts and financial records by the Office of the State Auditor, which is headed by an independently elected State official, the State Auditor. The Auditor has broad legal authority to inquire into all financial and legal compliance matters and such audits are considered equal to audits by certified public accounting firms. The 2007 financial audit of the City is complete and was conducted in conformance with Generally Accepted Auditing Standards. The financial statements of all City funds have been included in this audit. The City has been given an unqualified opinion for 2007. Please see the Auditor's Report. The State Auditor's Office also audits the City's administration of its federal grants under the single audit concept. B. AWARDS The Government Finance Officer's Association of the United States and Canada (GFOA) awarded a Certificate of Achievement for Excellence in Financial Reporting to the City of Auburn for its Comprehensive Annual Financial Report for the fiscal year ended December 31, 2006. This was the twentieth consecutive year that the City has achieved this prestigious award. In order to be awarded a Certificate of Achievement, a government must publish an easily readable and efficiently organized comprehensive annual financial report. This report must satisfy both generally accepted accounting principles and applicable legal requirements. 8 CITY OF AUBURN: 2007 CAFR LETTER OF TRANSMITTAL A Certificate of Achievement is valid for a period of one year only. We believe that our current Comprehensive Annual Financial Report continues to meet the Certificate of Achievement Program's requirements and we are submitting it to the GFOA to determine its eligibility for another certificate. The City has also received the Government Finance Officer's Association Distinguished Budget Presentation award for sixteen years. The City was one of just twenty-two cities in the state to receive both the Certificate of Achievement for Excellence in Financial Reporting and the Distinguished Budget Presentation award for 2006. C. ACKNOWLEDGMENTS Preparation of this report could not have been accomplished without the professional, efficient, and dedicated staff of the Finance department and various other City employees who assisted in its production. Further appreciation is extended to the Mayor and City Council for their encouragement, interest, and support in conducting the financial affairs of the City in a sound and progressive manner. The assistance of the auditors from the Office of the State Auditor is also greatly appreciated. Respectfully submitted, ~~ Shelley R. Coleman Finance Director 9 * * * * * MORE THAN YOU IMAGINED 10 CITY OF AUBURN: 2007 CAFR CERTIFICATE OF ACHIEVEMENT Certificate of Achievement for Excellence in Financial Reporting Presented to City of Auburn Washington For its Comprehensive Annual Financial Report for the Fiscal Year Ended December 31, 2006 A Certificate of Achievement for Excellence in Financial Reporting is presented by the Government Finance Officers Association of the United States and Canada to government units and public employee retirement systems whose comprehensive annual financial reports (CAFRs) achieve the highest standards in government accounting and financial reporting. ~ ~. Gx President ~/~ Executive Director 11 * * * * * MORE THAN YOU IMAGINED 12