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Home My WebLink About1-Introductory Section.pÝ×ÌÇ ÑÚ ßËÞËÎÒ ÉßÍØ×ÒÙÌÑÒ ÝÑÓÐÎÛØÛÒÍ×ÊÛ ßÒÒËßÔ Ú×ÒßÒÝ×ßÔ ÎÛÐÑÎÌ Ú·½¿´ Ç»¿® Ö¿²«¿®§ ïô îððí ¬¸®±«¹¸ Ü»½»³¾»® íïô îððí Ð®»°¿®»¼ ¾§ Ü»°¿®¬³»²¬ ±º Ú·²¿²½» Í¸»´´»§ Ý±´»³¿²ô Ú·²¿²½» Ü·®»½¬±® COMPREHENSIVE ANNUAL FINANCIAL REPORT For the Year Ended December 31,2003 TABLE OF CONTENTS Page I. INTRODUCTORY SECTION Title Page Table of Contents City Officials Organizational Chart (City and Council Committees) Letter of Transmittal Certificate of Achievement i 1 2 3 15 II. FINANCIAL SECTION Auditor's Report 17 Management's Discussion and Analysis 19 Basic Financial Statements Government-wide Financial Statements: Statement of Net Assets 39 Statement of Activities 40 Fund Financial Statements: Balance Sheet - Governmental Funds 43 Statement of Revenues, Expenses and Changes in Fund Balance - Governmental Funds 44 Reconciliation of the Statement of Revenues, Expenditures, and Changes in Fund Balances of Government Funds to the Statement of Activities 45 Statement of Revenues, Expenses and Changes in Fund Balance - Budget and Actual - General Fund 46 Statement of Revenues, Expenses and Changes in Fund Balance - Budget and Actual - Arterial Street Fund 47 Statement of Net Assets - Proprietary Funds 50 Statement of Revenues, Expenses, and Changes in Fund Net Assets -Proprietary Funds 51 Statement of Cash Flows - Proprietary Funds 52 Statement of Fiduciary Net Assets - Fiduciary Funds 55 Statement of Changes in Fiduciary Net Assets - Fiduciary Funds 56 Notes to the Financial Statements 57 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 - 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: City Street Special Revenue Fund 98 Hotel/Motel Tax Special Revenue Fund 99 Drug Forfeiture Special Revenue Fund 100 Local Law Enforcement Grant Special Revenue Fund 101 Í½¸»¼«´» ±º Î»ª»²«»ô Û¨°»²¼·¬«®»ô ¿²¼ Ý¸¿²¹» ·² Ú«²¼ Þ¿´¿²½» Þ«¼¹»¬ ¿²¼ ß½¬«¿´æ ø½±²¬·²«»¼÷ Ø±«·²¹ ú Ý±³³«²·¬§ Ü»ª»´±°³»²¬ Í°»½·¿´ Î»ª»²«» Ú«²¼ ïðî Î»½®»¿¬·±² Ì®¿·´ Í°»½·¿´ Î»ª»²«» Ú«²¼ ïðí Þ«·²» ×³°®±ª»³»²¬ ß®»¿ Í°»½·¿´ Î»ª»²«» Ú«²¼ ïðì Ý«³«´¿¬·ª» Î»»®ª» Í°»½·¿´ Î»ª»²«» Ú«²¼ ïðë ïçèê Ð¿®µ ¿²¼ Í¬®»»¬ Í°»½·¿´ Î»ª»²«» Ú«²¼ ïðê Ó·¬·¹¿¬·±² Í°»½·¿´ Î»ª»²«» Ú«²¼ ïðé Í°»½·¿´ Ð¿®µ ¿²¼ Î»½®»¿¬·±² Í°»½·¿´ Î»ª»²«» Ú«²¼ ïðè Ý±³¾·²·²¹ Þ¿´¿²½» Í¸»»¬ Ü»¾¬ Í»®ª·½» Ú«²¼ ïïð Ý±³¾·²·²¹ Í¬¿¬»³»²¬ ±º Î»ª»²«»ô Û¨°»²¼·¬«®»ô ¿²¼ Ý¸¿²¹» ·² Ú«²¼ Þ¿´¿²½» Ò±²óÓ¿¶±® Ü»¾¬ Í»®ª·½» Ú«²¼ ïïï Ý±³¾·²·²¹ Þ¿´¿²½» Í¸»»¬ Ý¿°·¬¿´ Ð®±¶»½¬ Ú«²¼ ïïí Ý±³¾·²·²¹ Í¬¿¬»³»²¬ ±º Î»ª»²«»ô Û¨°»²¼·¬«®»ô ¿²¼ Ý¸¿²¹» ·² Ú«²¼ Þ¿´¿²½» Ò±²óÓ¿¶±® Ý¿°·¬¿´ Ð®±¶»½¬ Ú«²¼ ïïì Ý±³¾·²·²¹ Þ¿´¿²½» Í¸»»¬ Ð»®³¿²»²¬ Ú«²¼ ïïê Ý±³¾·²·²¹ Í¬¿¬»³»²¬ ±º Î»ª»²«»ô Û¨°»²¼·¬«®»ô ¿²¼ Ý¸¿²¹» ·² Ú«²¼ Þ¿´¿²½» Ð»®³¿²»²¬ Ú«²¼ ïïé Ý±³¾·²·²¹ Í¬¿¬»³»²¬ ±º Ò»¬ ß»¬ Ò±²óÓ¿¶±® Ð®±°®·»¬¿®§ Ú«²¼ ïïç Ý±³¾·²·²¹ Í¬¿¬»³»²¬ ±º Î»ª»²«»ô Û¨°»²»ô ¿²¼ Ý¸¿²¹» ·² Ú«²¼ Ò»¬ ß»¬ Ò±²óÓ¿¶±® Ð®±°®·»¬¿®§ Ú«²¼ ïîð Ý±³¾·²·²¹ Í¬¿¬»³»²¬ ±º Ý¿¸ Ú´±© Ð®±°®·»¬¿®§ Ú«²¼ ïîï Ý±³¾·²·²¹ Þ¿´¿²½» Í¸»»¬ ×²¬»®²¿´ Í»®ª·½» Ú«²¼ ïîì Ý±³¾·²·²¹ Í¬¿¬»³»²¬ ±º Î»ª»²«»ô Û¨°»²»ô ¿²¼ Ý¸¿²¹» ·² Ú«²¼ Ò»¬ ß»¬ ×²¬»®²¿´ Í»®ª·½» Ú«²¼ ïîë Ý±³¾·²·²¹ Í¬¿¬»³»²¬ ±º Ý¿¸ Ú´±© ×²¬»®²¿´ Í»®ª·½» Ú«²¼ ïîê Í¬¿¬»³»²¬ ±º Ý¸¿²¹» ·² ß»¬ ¿²¼ Ô·¿¾·´·¬·» ß¹»²½§ Ú«²¼ ïîç Ý¿°·¬¿´ ß»¬ Ë»¼ ·² ¬¸» Ñ°»®¿¬·±² ±º Ù±ª»®²³»²¬ Ú«²¼æ Ý±³°¿®¿¬·ª» Í½¸»¼«´» ¾§ Í±«®½» ïíí Í½¸»¼«´» ¾§ Ú«²½¬·±² ¿²¼ ß½¬·ª·¬§ ïíì Í½¸»¼«´» ±º Ý¸¿²¹» ¾§ Ú«²½¬·±² ¿²¼ ß½¬·ª·¬§ ïíê ×××ò ÍÌßÌ×ÍÌ×ÝßÔ ÍÛÝÌ×ÑÒ Ú·¹«®» Ù»²»®¿´ Ù±ª»®²³»²¬¿´ Î»ª»²«» ¿²¼ Û¨°»²¼·¬«®» ï ïíè Ì»² Ç»¿® Ð®±°»®¬§ Ì¿¨ Ü¿¬¿ î ïìï Î¿¬·± ±º Ò»¬ Ù»²»®¿´ Þ±²¼»¼ Ü»¾¬ í ïìì Ý±³°«¬¿¬·±² ±º Ô»¹¿´ Ü»¾¬ Ó¿®¹·² ì¿ ïìë Ý±³°«¬¿¬·±² ±º Ò»¬ Ü·®»½¬ ¿²¼ Û¬·³¿¬»¼ Ñª»®´¿°°·²¹ Ü»¾¬ ì¾ ïìë Ì»² Ç»¿® Ü»¾¬ Í»®ª·½» ¬± Ù»²»®¿´ Û¨°»²¼·¬«®» Î¿¬·± ë ïìê Ì»² Ç»¿® Ë¬·´·¬§ Î»ª»²«» Þ±²¼ Ý±ª»®¿¹» ê ïìé Ì»² Ç»¿® Í°»½·¿´ ß»³»²¬ Ý±´´»½¬·±² é ïìè Ì»² Ç»¿® Ð±°«´¿¬·±² ¿²¼ Ø±«·²¹ Ì®»²¼ è ïìç Û³°´±§³»²¬ ·² ß«¾«®² ç ïëð Î»¬¿·´ Ì¿¨ Ý±´´»½¬·±² ¾§ Í»½¬±® ïð ïëï Ð®·²½·°¿´ Ì¿¨°¿§»® ïï ïëî Ì»² Ç»¿® Þ«·´¼·²¹ Ð»®³·¬ ¿²¼ Ý±²¬®«½¬·±² Ê¿´«» ïî ïëí Ì»² Ç»¿® Í¬¿ºº·²¹ Ô»ª»´ ¾§ Ü»°¿®¬³»²¬ ïí ïëì Ð±´·½» Ü»°¿®¬³»²¬ Í¬¿¬·¬·½ ïì ïëë Ú·®» Ü»°¿®¬³»²¬ Í¬¿¬·¬·½ ïë ïëê Ð¿®µ ¿²¼ Î»½®»¿¬·±² Í¬¿¬·¬·½ ïê ïëé Ð®±°®·»¬¿®§ Ú«²¼óÉ±®µ·²¹ Ý¿°·¬¿´ ïé ïëè ß»»¼ Ê¿´«» ¾§ Ì§°» ïè ïëç Ó·½»´´¿²»±« Í¬¿¬·¬·½ ïç ïêð ·· Ý×ÌÇ ÑÚÚ×Ý×ßÔÍ ÓßÇÑÎ Ð»¬» Ô»©· Ý×ÌÇ ÝÑËÒÝ×Ô Ò¿²½§ Þ¿½µ« Ù»²» Ý»®·²± Ô§²² Ò±®³¿² Þ·´´ Ð»´±¦¿ Í«» Í·²¹»® Î±¹»® Ì¸±®¼¿®±² Î·½¸ É¿¹²»® ÜÛÐßÎÌÓÛÒÌ ØÛßÜÍ Ú·²¿²½» Ü·®»½¬±® Í¸»´´»§ Ý±´»³¿² Ý·¬§ ß¬¬±®²»§ Ü¿² Ø»·¼ Ð¿®µ Ü·®»½¬±® Ü¿®§´ Ú¿¾»® ß½¬·²¹ Ú·®» Ý¸·»º Î« Ê¿²¼ª»® Ð±´·½» Ý¸·»º Ö·³ Õ»´´§ Ð«¾´·½ É±®µ Ü·®»½¬±® Ü»²²· Ü±©¼§ Ð´¿²²·²¹ Ü·®»½¬±® Ð¿«´ Õ®¿« Ü·®»½¬±® ±º Ø«³¿² Î»±«®½» ú Î·µ Ó¿²¿¹»³»²¬ Þ®»²¼¿ Ø»·²»³¿² Ý×ÌÇ ÑÚ ßËÞËÎÒæ îððí ÝßÚÎ ÑÎÙßÒ×ÆßÌ×ÑÒ Ý×Ì×ÆÛÒÍ ÓßÇÑÎ ÖËÜÙÛ Ý×ÌÇ ÝÑËÒÝ×Ô Ð»¬» Ô»©· Ð¿¬®·½µ Þ«®² ÐËÞÔ×Ý ÐËÞÔ×Ý ÐËÞÔ×Ý ÉÑÎÕÍ ßÜÓ×Ò×ÍÌÎßÌ×ÊÛ ÍßÚÛÌÇ ÍÛÎÊ×ÝÛÍ ÍÛÎÊ×ÝÛÍÜ»²²· Ü±©¼§ Ú×ÎÛ ÐßÎÕÍ ú ÐÔßÒÒ×ÒÙ ÐÑÔ×ÝÛ ÎÛÝÎÛßÌ×ÑÒ Î« Ê¿²¼ª»® Ð¿«´ Õ®¿« Ö·³ Õ»´´§ Ü¿®§´ Ú¿¾»® ß½¬·²¹ Ý¸·»º ØËÓßÒ ÔÛÙßÔ Ú×ÒßÒÝÛ ÎÛÍÑËÎÝÛÍ Ü¿² Ø»·¼ Í¸»´´»§ Ý±´»³¿² Þ®»²¼¿ Ø»·²»³¿² ÝÑËÒÝ×Ô ÝÑÓÓ×ÌÌÛÛÍ Ú×ÒßÒÝÛ ÝÑÓÓ×ÌÌÛÛÓËÒ×Ý×ÐßÔ ÍÛÎÊ×ÝÛÍ Ò¿²½§ Þ¿½µ«ô Ý¸¿·®°»®±²Ù»²» Ý»®·²±ô Ý¸¿·®°»®±² Ô§²² Ò±®³¿²Î·½¸ É¿¹²»® Î±¹»® Ì¸±®¼¿®±²Þ·´´ Ð»´±¦¿ ÐÔßÒÒ×ÒÙ ú ÝÑÓÓËÒ×ÌÇ ÜÛÊÛÔÑÐÓÛÒÌÐËÞÔ×Ý ÉÑÎÕÍ Í«» Í·²¹»®ô Ý¸¿·®°»®±²Î·½¸ É¿¹²»®ô Ý¸¿·®°»®±² Ô§²² Ò±®³¿²Ù»²» Ý»®·²± Ò¿²½§ Þ¿½µ«Î±¹»® Ì¸±®¼¿®±² î June 16, 2004 Mayor, City Council, and Citizens of the City of Auburn: This correspondence transmits to you the City of Auburn's Comprehensive Annual Financial Report (CAFR) for the fiscal year ended December 31, 2003. 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 report is prepared in accordance with the Revised Code of Washington (RCW) 43.09.230. 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 annual budget. This report contains significant changes in financial reporting in accordance with revised guidance by the Governmental Accounting Standards Board (GASB). These changes are comprehensive and affect all aspects of the report. As such, this year's report is significantly different than prior years' reports. Further information regarding changes required by GASB "Statement No. 34 - Basic Financial Statements and Management's Discussion and Analysis - for State and Local Governments" may be found on the GASB web site at www.gasb.org. 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 Generally Accepted Accounting Principles (GAAP) and in conformance with financial reporting standards issued by the Governmental Accounting Standards Board (GASB). 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 2002 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 10 years. 3 Ý×ÌÇ ÑÚ ßËÞËÎÒæ îððí ÝßÚÎ ÔÛÌÌÛÎ ÑÚ ÌÎßÒÍÓ×ÌÌßÔ Ýò ÎÛÐÑÎÌ×ÒÙ ÛÒÌ×ÌÇ Ì¸» Ý·¬§ ±º ß«¾«®² ©¿ ·²½±®°±®¿¬»¼ ·² ïèçï ¿²¼ ½«®®»²¬´§ ±°»®¿¬» ¿ ¿ ²±²ó½¸¿®¬»® Ý±¼» Ý·¬§ «²¼»® ¬¸» ´¿© ±º ¬¸» Í¬¿¬» ±º É¿¸·²¹¬±²ò Ý±¼» Ý·¬§ ¬¿¬« ·² É¿¸·²¹¬±² °®±ª·¼» ¸±³» ®«´» ¿«¬¸±®·¬§ ¬± ½·¬·»ò ß«¾«®² ¸¿ ¿ Ó¿§±®ñÝ±«²½·´ º±®³ ±º ¹±ª»®²³»²¬ô ¿²¼ ¬¸» Ó¿§±® · »´»½¬»¼ ¿²¼ · ¬¸» º«´´¬·³» Ý¸·»º Û¨»½«¬·ª» Ñºº·½»®ò Ì¸» Ý·¬§ Ý±«²½·´ ¸¿ »ª»² »´»½¬»¼ ³»³¾»® ¿²¼ · ¬¸» ´»¹·´¿¬·ª» ¾±¼§ º±® ¬¸» Ý·¬§ò Ì¸» ¿¼³·²·¬®¿¬·±² · ½±³°±»¼ ±º »·¹¸¬ ¼»°¿®¬³»²¬ ¬¸¿¬ ®»°±®¬ ¬± ¬¸» Ó¿§±®ò Ì¸» Ý·¬§ · ´±½¿¬»¼ °®·³¿®·´§ ·² ±«¬¸»®² Õ·²¹ Ý±«²¬§ ø½±«²¬§ »¿¬ô Í»¿¬¬´»÷ ¿²¼ ¿ ³¿´´ ²±®¬¸»¿¬»®² °±®¬·±² ±º Ð·»®½» Ý±«²¬§ò Ì¸»» ¿®» ¬¸» ¬©± ³±¬ °±°«´±« ½±«²¬·» ·² ¬¸» Í¬¿¬» ±º É¿¸·²¹¬±²ô ½±³°®··²¹ ±ª»® ìðû ±º ¬¸» °±°«´¿¬·±²ò Ì¸» Ý·¬§ · ¬®¿¬»¹·½¿´´§ ´±½¿¬»¼ ·² ®»´¿¬·±² ¬± ¬¸» ´¿¾±® ¿²¼ ½±²«³»® ³¿®µ»¬ ±º ¬¸» ¬©± ´¿®¹»¬ ½·¬·» ·² ¬¸» ¿®»¿æ Í»¿¬¬´» ·² Õ·²¹ Ý±«²¬§ ¿²¼ Ì¿½±³¿ ·² Ð·»®½» Ý±«²¬§ò ß«¾«®² ½«®®»²¬´§ »®ª» ¿°°®±¨·³¿¬»´§ ìëôððð °»±°´» ©·¬¸·² ·¬ ·²½±®°±®¿¬»¼ ´·³·¬ ¿ ©»´´ ¿ ±ª»® ìðôððð °»±°´» ·² ¿¼¶¿½»²¬ «²·²½±®°±®¿¬»¼ ¿®»¿ò ß«¾«®² ¾»¹¿² ¿ ¿ ³¿´´ ®«®¿´ ½±³³«²·¬§ ¾¿»¼ ±² ¿¹®·½«´¬«®» ¿²¼ ¬¸» ®¿·´®±¿¼ô ©¸·½¸ ³¿·²¬¿·²»¼ ¿ ·¹²·º·½¿²¬ ©·¬½¸·²¹ ¿²¼ ®»°¿·® º¿½·´·¬§ò Ì¸» Ý·¬§ ¸¿ ¹®±©² ·¹²·º·½¿²¬´§ ·²½» É±®´¼ É¿® ××ô ¾±¬¸ ¿ ¿ ®»·¼»²¬·¿´ ½±³³«²·¬§ ¿²¼ ¿ ¿ ½±³³»®½·¿´ ¿²¼ ·²¼«¬®·¿´ ¿®»¿ò ß«¾«®² ¸¿ ¾»½±³» ¿ ·¹²·º·½¿²¬ ¿®»¿ º±® ¿«¬±³±¾·´» ¿´» ¿²¼ ¸¿ ¿´± ¼»ª»´±°»¼ ¿ ·¹²·º·½¿²¬ ³¿²«º¿½¬«®·²¹ ¿²¼ ¼·¬®·¾«¬·±² ¾¿» ©·¬¸ ¬¸» ´¿®¹»¬ »³°´±§»® ¾»·²¹ Ì¸» Þ±»·²¹ Ý±òô ©¸·½¸ »³°´±§ ±ª»® ìôëðð °»±°´» ·² ·¬ ß«¾«®² º¿½·´·¬§ò Þ±»·²¹ · ¿ ©±®´¼©·¼» «°°´·»® ±º ¿·®½®¿º¬ ¿²¼ ®»´¿¬»¼ °®±¼«½¬ò Ì¸» Ý·¬§ ¿»»¼ ª¿´«¿¬·±² ·² îððíô º±® îððì °®±°»®¬§ ¬¿¨ ½±´´»½¬·±² ©¿ üìôìçîôïéèôðððò Ì¸» Ý·¬§ °®±ª·¼» ¿ ©·¼» ®¿²¹» ±º »®ª·½»ô ¾±¬¸ ¾»²»º·½·¿´ ¿²¼ ²»½»¿®§ô ¬± ·¬ ®»·¼»²¬ ¿ ©»´´ ¿ ¬± ¬¸» ¿¼¶¿½»²¬ ¿®»¿ò Ì¸»» »®ª·½» ·²½´«¼» °±´·½» °®±¬»½¬·±²å º·®» °®±¬»½¬·±²ô ©¸·½¸ ·²½´«¼» »³»®¹»²½§ ³»¼·½¿´ »®ª·½»å °¿®µ ¿²¼ ®»½®»¿¬·±²¿´ º¿½·´·¬·» ¬¸¿¬ ·²½´«¼» ¿ »²·±® ½»²¬»®ô ¹±´º ½±«®» ¿²¼ ³«»«³å ´¿²¼ «» ³¿²¿¹»³»²¬ ¿²¼ ¼»ª»´±°³»²¬ ®»¹«´¿¬·±²å ·²º®¿¬®«½¬«®» ½±²¬®«½¬·±² ¿²¼ ³¿·²¬»²¿²½»å ©¿¬»®ô ¿²·¬¿®§ »©¿¹» ½±´´»½¬·±²ô ¬±®³ ¼®¿·²¿¹»ô ¿²¼ ±´·¼ ©¿¬» »®ª·½»å ¿ ¹»²»®¿´ ¿ª·¿¬·±² ¿·®°±®¬å ¿²¼ ¿ ³«²·½·°¿´ ½»³»¬»®§ò Ì¸» Ý·¬§ ¿´± ¸¿ ¿ ³«²·½·°¿´ ½±«®¬ ¿²¼ ¶¿·´ º¿½·´·¬·» ¬¸¿¬ °®±ª·¼» »®ª·½» ¬± ±¬¸»® ¹±ª»®²³»²¬¿´ ¿¹»²½·» ¬¸®±«¹¸ ·²¬»®´±½¿´ ¿¹®»»³»²¬ò ××ò ÛÝÑÒÑÓ×Ý ÝÑÒÜ×Ì×ÑÒ ßò ÍËÓÓßÎÇ ÑÚ ÔÑÝßÔ ÛÝÑÒÑÓÇ Ì¸» »½±²±³§ ±º ¬¸» Ý·¬§ ±º ß«¾«®² · ¼·ª»®·º·»¼ ¿²¼ ¸¿ ·¹²·º·½¿²¬ ¬®»²¹¬¸ò ß´¬¸±«¹¸ ¬¸» »½±²±³§ · ®»º´»½¬·ª» ±º ¬¸» ®»¹·±² ·² ©¸·½¸ ·¬ · ´±½¿¬»¼ ¿²¼ «¾¶»½¬ ¬± ®»¹·±²¿´ ¿²¼ ²¿¬·±²¿´ »½±²±³·½ ½§½´»ô ß«¾«®² ¼·ª»®·¬§ ¿²¼ ¬»¿¼§ ¹®±©¬¸ ¸¿ °®±¬»½¬»¼ ·¬ «¾¬¿²¬·¿´´§ º®±³ »ª»®» ½§½´»ò Ò±¬» ¬¸» ïðó§»¿® «³³¿®·» ±º ¹»²»®¿´ ¹±ª»®²³»²¬ ®»ª»²«» ¿²¼ ¿»»¼ ª¿´«¿¬·±² »¬ º±®¬¸ ¾»´±©ò Ì¸» ´¿®¹» «° ¬·½µ ·² ®»ª»²«» ¼«®·²¹ îððï ¿²¼ îððî · º®±³ ·²¬»®¹±ª»®²³»²¬¿´ ¬¸ ¹®¿²¬ ¬¸» ½·¬§ ®»½»·ª»¼ º±® ¬©± Ú¿¬ Ý±®®·¼±® °®±¶»½¬ô ¬¸» í®¼ Í¬®»»¬ ±ª»®°¿ ¿²¼ ¬¸» îéé ½±®®·¼±® ±ª»® °¿»ò Ì¸»» °®±¶»½¬ ¿®» ²±© ½±³°´»¬»ò ì CITY OF AUBURN: 2003 CAFR LETTER OF TRANSMITTAL $60,000,000 GENERAL GOVERNMENTAL REVENUES 1994-2003 $50,000,000 $40,000,000 $30,000,000 $20,000,000 $10,000,000 $- v ~ ~ ~ ro m 0 ~ N ~ m m m m m moo 0 0 m m m m m moo 0 0 N N N N II Miscellaneous . Special Assessments II Fines and Forfeits III Charges for Services II Intergovernmental III License and Permits II Taxes GENERAL GOVERNMENTAL EXPENDITURES 1994 - 2003 $60,000,000 $50,000,000 $40,000,000 $30,000,000 $20,000,000 $10,000,000 $- v ~ ~ ~ ro m 0 ~ N ~ m m m m m m 0 0 0 0 m m m m m m 0 0 0 0 N N N N III Debt Service III Culture and Recreation II Mental and Physical Health · Economic Environment II Transportation II Physical Environment · Security of Persons and Property · General Government 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. Most recently, Safeway Inc. purchased 137 acres of the Boeing property in Auburn and is constructing a food distribution and packaging facility at the site. These facilities are expected to generate over 900 family wage jobs. Auburn Regional Medical Center, also located in Auburn, serves the local geographic area and is a major trauma center of the northwest. The medical center recently opened a new wing adding over 107,000 square feet that includes a state-of-the-art surgery center. 5 CITY OF AUBURN: 2003 CAFR LETTER OF TRANSMITTAL 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, a major destination mall, was completed in 1995. Adjacent mall development is currently underway with only a few prime sites left available for building. Development that has taken place over past years includes 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. In 2003, 40.8°Æ> of the retail sales in the City were from automobiles and related products and services. In 2003, the City received $12.9 million in sales taxes, a 3.8°Æ> increase over 2002. The following graph depicts annual collections over the past ten years: $14,000 $12,000 $10,000 $8,000 $6,000 $4,000 $2,000 $- TOTAL ANNUAL SALES TAX (in thousands) 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 The overall increase this past year was much better than the previous year, but still lagged behind the period from 1995 to 2001, which averaged 7.3°Æ> growth. As the area is moving slowly out of the recession the economic climate is improving. Construction permits issued over the past several years have been robust and are continuing to strengthen. Permits for the first quarter of 2004 have been double that of the same period of previous years. There are several downtown projects recently completed and more in the planning stages. This revitalization trend is positive for the aging downtown core and it is anticipated that it will continue. The Boeing Company's layoffs and divestiture in the Puget Sound area, since 2001, have had an effect on the regional and local economy. Since then, Boeing has reduced approximately 40°Æ> of the jobs in Auburn with more reductions expected in 2004. The Boeing downsizing operation may lead to a new economic growth cycle in Auburn as the plant and surrounding vacated land open up development opportunities for other businesses. In addition to Safeway relocating to the site, a large computer supply and services center, Zones Corporate Solutions, Inc., has relocated to Auburn by taking over one of the Boeing administrative buildings. 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 was the completion of Emerald Downs in the summer of 1996, a major thoroughbred horseracing facility in Auburn, to replace Longacres - the area's former racing facility located in Renton, Washington. 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This retail shopping center houses the City's second Top Food and Drug, a Starbucks, restaurants, UPS store, and professional services to name a few. · The City issued 583 residential permits in 2003 for new construction, remodels, and rehabs. In addition, 337 commercial and industrial permits were issued for new projects and renovations. III. MAJOR INITIATIVES The Comprehensive Annual Financial Report (CAFR) has many purposes. It represents clearly the financial health of the City and is audited by the Washington State Auditor's Office. The CAFR should also illustrate where the expenditures were made and how they accomplished the significant priorities as established annually by the City Council. In 2002 and 2003, the Mayor and City Council held extensive goal-setting sessions to review and define the City's capital and program goals for the next fifteen years. Beginning in the spring of 2003, the Council started holding an annual budget workshop to identify which goals should be included for the subsequent years. The goals and objectives are designed to be specific, measurable and realistic. Individual department heads are responsible for the development of detailed work plans and the accomplishment of the goals. These work plans thus become the basis for the departmental budgets for the coming year. Throughout the year, department heads report regularly to the Mayor concerning the status of their assigned goals. At mid-year, department heads prepare formal reports on the progress towards completion of their assigned goals. Any changes in strategy to accomplish these goals are addressed at this time. At year-end, department heads make another full report to the Mayor and Council concerning the year-end status of their department's assigned goals. The City's Vision Statement, along with the Mission Statement, reflect Auburn's current economic development conditions as set forth below: AUBURN'S VISION FOR THE FUTURE: As a city of regional significance, proud of its small town heritage as well as the diversity of its people and neighborhoods, Auburn offers an opportunity for people of all ages to enjoy life. CITY OF AUBURN MISSION STATEMENT: To provide a service-oriented government that meets the needs of our citizens and business community through efficient and professional management with responsive and accessible leadership. These statements are a guiding force in the accomplishment of citywide goals and objectives as described in this section. Major 2003 initiatives, whether ongoing or completed, are organized below, under the structure used for development of the 2003 citywide goals. A. ASSURE PUBLIC SAFETY FOR CITIZENS OF AUBURN During 2003, the Police department maintained National Accreditation. To maintain this accreditation, the Police department had to comply with a set of standards established for police 8 Ý×ÌÇ ÑÚ ßËÞËÎÒæ îððí ÝßÚÎ ÔÛÌÌÛÎ ÑÚ ÌÎßÒÍÓ×ÌÌßÔ ¿¹»²½·» ¾§ ¿ ²¿¬·±²¿´ ½±³³·¬¬»»ò Ì¸» ¼»°¿®¬³»²¬ ©·´´ ½±²¬·²«» ¬± ½±³°´§ ©·¬¸ ¬¸»» ¬¿²¼¿®¼ ¿²¼ ¾» ³±²·¬±®»¼ º±® «½¸ ½±³°´·¿²½»ò Ì¸» ¼»°¿®¬³»²¬ ½±²¬·²«»¼ ¬¸» Ý±³³«²·¬§ Ð±´·½·²¹ Ð®±¹®¿³ ¬¸®±«¹¸ ¬®¿·²·²¹ ¿²¼ »¼«½¿¬·±²ò Ì¸»§ ¿´± ½±²¬·²«»¼ ½±³³«²·¬§ »¼«½¿¬·±² ¾§ °®±ª·¼·²¹ °»½·¿´ ¬®¿·²·²¹ ¬± ´¿²¼´±®¼ ¿²¼ ¬»²¿²¬ ±² »ª·½¬·±² º±® ²¿®½±¬·½ ¿½¬·ª·¬§å ÜßÎÛ ½´¿» ¬± ¿´´ °«¾´·½ »´»³»²¬¿®§ ½¸±±´å ¿²¼ ½±²¬·²«»¼ ¬¸» ß«¾«®² Ý·¬·¦»² Ð±´·½» ß½¿¼»³§ò Ñ¬¸»® °®±¶»½¬ô ¬± ´·¬ ¿ º»©ô ·²½´«¼»æ½±³°´»¬»¼ ¬¸» ´¿°¬±°ó®»°±®¬·²¹ °®±¶»½¬ ¾§ °®±ª·¼·²¹ ½±²²»½¬·ª·¬§ ¾»¬©»»² ¬¸» ´¿°¬±° ·² ¬¸» °±´·½» ª»¸·½´» ¿²¼ ¬¸» ·²ó¸±«» Í°·´´³¿² ¼¿¬¿¾¿»å °®»°¿®»¼ ¬¿ºº·²¹ ½±²¬·²¹»²½§ °´¿² ·² ¿²¬·½·°¿¬·±² ±º ·²½®»¿»¼ °±°«´¿¬·±² ¼»³¿²¼å ½±²¬·²«»¼ °±´·½» »®ª·½» ¬± Ó«½µ´»¸±±¬ Ì®·¾¿´ ³»³¾»® ©·¬¸·² ¬¸» Ý·¬§ ´·³·¬å ¿²¼ ½±²¬·²«»¼ °´¿² ±º ®»¼«½·²¹ ¬¸» ¼»°¿®¬³»²¬ ¼»°»²¼»²½§ ±² ±«¬·¼» ¶¿·´ »®ª·½»ò Ì¸» Ú·®» ¼»°¿®¬³»²¬ °®±ª·¼» »®ª·½» ¼»·¹²»¼ ¬± °®±¬»½¬ ¬¸» ´·ª» ¿²¼ °®±°»®¬§ ±º ¬¸» ·²¸¿¾·¬¿²¬ ±º ¬¸» Ý·¬§ º®±³ ¬¸» ¿¼ª»®» »ºº»½¬ ±º º·®»ô «¼¼»² ³»¼·½¿´ »³»®¹»²½·» ±® »¨°±«®» ¬± ¼¿²¹»®±« ½±²¼·¬·±² ½®»¿¬»¼ ¾§ »·¬¸»® ³¿² ±® ²¿¬«®»ò Ì¸» Ú·®» ¼»°¿®¬³»²¬ · ®»°±²·¾´» º±® ¬¸¿¬ °¿®¬ ±º ¬¸» º·®» °®»ª»²¬·±² ¿²¼ ·²ª»¬·¹¿¬·±²ô »³»®¹»²½§ ³»¼·½¿´ »®ª·½»ô ¸¿¦¿®¼±« ³¿¬»®·¿´ ®»°±²»ô ¼·¿¬»® »®ª·½» ¿²¼ °«¾´·½ º·®» °®»ª»²¬·±² ¿½¬·ª·¬·»ò Ü«®·²¹ îððíô ¬¸» Ú·®» ¼»°¿®¬³»²¬æ ®»°´¿½»¼ ¿ ïçèì º·®» »²¹·²» ©·¬¸ ¿ ²»© Ï«¿²¬«³ Ð«³°»®å ½±³°´»¬»¼ ¿ Þ¿·½ Ô·º» Í«°°±®¬ ¬®¿²°±®¬ ¬«¼§ ¿²¼ »¨°´±®»¼ °¿®¬²»®¸·° ©·¬¸ ±¬¸»® ¿®»¿ º·®» ¼»°¿®¬³»²¬å ¾»¹¿² ¿ °·´±¬ °®±¹®¿³ ±º ª»¸·½´»ó³±«²¬»¼ ½±³°«¬»® ¬± ·²¬»¹®¿¬» ·²¬± Ê¿´´»§ Ý±³³«²·½¿¬·±² Ý»²¬»® Ý±³°«¬»® ß·¼»¼ Ü·°¿¬½¸ §¬»³ ¬± »²¸¿²½» º·®»º·¹¸¬»® ¿º»¬§ô »ºº·½·»²½§ ¿²¼ »ºº»½¬·ª»²»å ¿²¼ «°¹®¿¼»¼ ¿´´ ¼»°¿®¬³»²¬ »´ºó½±²¬¿·²»¼ ¾®»¿¬¸·²¹ ¿°°¿®¿¬« ©·¬¸ ²»© °»®±²¿´ ¿´»®¬ ¿º»¬§ §¬»³ ¿²¼ »´»½¬®±²·½ °»¿µ·²¹ °®±¶»½¬±®ò Þò ÝÑÒÌ×ÒËÛ ÌÑ ÐÎÑÊ×ÜÛ ÞßÍ×Ý ÙÑÊÛÎÒÓÛÒÌ ÍÛÎÊ×ÝÛÍ Ù»²»®¿´ ¹±ª»®²³»²¬ º«²½¬·±² ¿®» °®±ª·¼»¼ ¿²¼ ¿¼³·²·¬»®»¼ ·² ¬¸» Ù»²»®¿´ô Í°»½·¿´ Î»ª»²«»ô Ü»¾¬ Í»®ª·½»ô ¿²¼ Ý¿°·¬¿´ Ð®±¶»½¬ º«²¼ò Ì¸»» º«²¼ ¸¿®» ¹»²»®¿´ ®»ª»²«» ±«®½» ¿²¼ ·²½´«¼» ¾¿·½ ¹±ª»®²³»²¬ »®ª·½»æ °«¾´·½ ¿º»¬§ô °¿®µ ¿²¼ ®»½®»¿¬·±²ô °´¿²²·²¹ ¿²¼ ¦±²·²¹ô ³«²·½·°¿´ ½±«®¬ô ¬®»»¬ ³¿·²¬»²¿²½» ¿²¼ ½±²¬®«½¬·±²ô ¿²¼ ¿±½·¿¬»¼ ¿¼³·²·¬®¿¬·ª» ¿²¼ «°°±®¬ »®ª·½»ò ß½½±³°´·¸³»²¬ ¼«®·²¹ îððí ·²½´«¼»æ ²»¹±¬·¿¬·±² ®»´¿¬»¼ ¬± ¼»ª»´±°³»²¬ ±º ¿ ²»© °«¾´·½ ¿º»¬§ ½±³°´»¨å ª»¹»¬¿¬·±² ¿²¼ ²±¨·±« ©»»¼ ½±²¬®±´å °®±½«®»³»²¬ ±º ¿ ²»© ·¼»©¿´µ ½´»¿²»®å ½±²¬·²«¿¬·±² ±º ½®±©¿´µ ·³°®±ª»³»²¬ °®±¹®¿³ô ½±²½»²¬®¿¬·²¹ ±² ¬¸» Ý»²¬®¿´ Þ«·²» Ü·¬®·½¬å ·³°´»³»²¬¿¬·±² ±º Ù±ª»®²³»²¬ ß½½» Ý¿¾´» Ì»´»ª··±²ô ¿´´±©·²¹ ½·¬·¦»² ¬± ¬¿§ ·²º±®³»¼ ±º ±²¹±·²¹ Ý·¬§ ¾«·²»å ½®»¿¬·±² ±º ¿² ¿¹®»»³»²¬ ©·¬¸ ¬¸» É¿¸·²¹¬±² Ü»°¿®¬³»²¬ ±º Ì®¿²°±®¬¿¬·±² ¿²¼ ¬¸» Ó«½µ´»¸±±¬ ×²¼·¿² Ì®·¾» ®»¹¿®¼·²¹ »»µ·²¹ ¿²¼ °´¿²²·²¹ ÍÎ ïêì ¿º»¬§ ¿²¼ ½¿°¿½·¬§ ·³°®±ª»³»²¬å ¿²¼ ·³°´»³»²¬¿¬·±² ±º ¿ °®±ó¿½¬·ª» É»¬ Ò·´» Ê·®« ³±¯«·¬± ³±²·¬±®·²¹ ¿²¼ ½±²¬®±´ °®±¹®¿³ò Ð¿®µ ¿²¼ ®»½®»¿¬·±² °®±¹®¿³ º±½«»¼ ±² °®±ª·¼·²¹ ¿ ª¿®·»¬§ ±º º¿½·´·¬·» ¿²¼ °®±¹®¿³ º±® ®»·¼»²¬ ±º ¿´´ ¿¹» ¿²¼ ·²¬»®»¬ò Ì¸» ¼»°¿®¬³»²¬ ©±®µ ½´±»´§ ©·¬¸ ¬¸» ß«¾«®² Í½¸±±´ Ü·¬®·½¬ô Ù®»»² Î·ª»® Ý±³³«²·¬§ Ý±´´»¹» ¿²¼ ±¬¸»® ½«´¬«®¿´ ¿²¼ §±«¬¸ »®ª·²¹ ¿¹»²½·» ·² ß«¾«®²ô ¬± °®±ª·¼» º¿½·´·¬·» ¿²¼ »®ª·½» ¬± ½·¬·¦»²ò Ñ¬¸»® »®ª·½» °®±ª·¼»¼ º±® ½·¬·¦»² ·²½´«¼» ¬¸» ½±²¬·²«¿¬·±² ±º »»²¬·¿´ ¸«³¿² »®ª·½» °®±¹®¿³ô ½±²¬·²«»¼ »²¸¿²½»³»²¬ ±º ¬¸» ½±³°´»¨ ¿½½±«²¬·²¹ ¿²¼ °«¾´·½ ¿º»¬§ §¬»³ô ¿²¼ »¨°´±®¿¬·±² ±º ±°¬·±² º±® ±²´·²» »®ª·½» ¬± Ý·¬§ ±º ß«¾«®² ½·¬·¦»²ò Ýò ÛÒÝÑËÎßÙÛ ßÐÐÎÑÐÎ×ßÌÛ ßÒÜ ÛÝÑÒÑÓ×ÝßÔÔÇ ÍÑËÒÜ ÜÛÊÛÔÑÐÓÛÒÌ ßÒÜ ßÍÍËÎÛ ÌØÛ ×ÒÚÎßÍÌÎËÝÌËÎÛ ÒÛÝÛÍÍßÎÇ ÚÑÎ ×ÌÍ ÍËÐÐÑÎÌ Ü«®·²¹ îððíô ½·¬§ ¬¿ºº »¬¿¾´·¸»¼ ¿ ¯«¿®¬»®´§ ß«¾«®² Ó¿®µ»¬·²¹ ¿²¼ Ð«¾´·½ Î»´¿¬·±² Ð®±º»·±²¿´ ®±«²¼¬¿¾´» ·² ¿² »ºº±®¬ ¬± °®±¿½¬·ª»´§ °«®«» ±°°±®¬«²·¬·»ò ß´±²¹ ©·¬¸ ¬¸·ô ç CITY OF AUBURN: 2003 CAFR LETTER OF TRANSMITTAL environment impact statements were prepared for Kersey III and Valley Drive-in planned developments, the permitting process was evaluated and recommended changes are being implemented, and "Urban Center" designation was secured for downtown. Several major utility improvements are currently under construction or were completed in 2003 that will or have upgraded and extended existing facilities. Improvements include, but are not limited to: recoated the exterior and interior surfaces of certain reservoirs; wells 2 and 4 were rehabilitated; the Water District 111/Duberry emergency intertie agreement was finalized; negotiations were completed with the Muckleshoot Tribe for the construction of a new Auburn Way South sewer system; installed backflow protection on the potable water service to the Peasley Ridge pump station; obtained a temporary National Pollution Discharge Elimination System Phase II (under 100,000 population) permit; raised Auburn's National Flood Insurance Plan rating from class 8 to class 7; increased the measured rate of residential recycling to 48°Æ> by volume; contacted 160 multi-family complexes and set up recycling programs for half of these; and implemented the Annual Spring Clean Up campaign. The City's Comprehensive Transportation Plan continued to be a priority of the Public Works department, and the Six-Year Street Plan was updated in 2002. Several projects were worked on during the year, such as: overlay of West Valley Highwa1 from 15th SW to Peasley Canyon; Auburn Way South from 6th Street SE to M Street SE; and 3r Street SE and S. Division from 15th Street S to Auburn Way So. The City began collecting transportation impact fees mid-2001 on projects that impact existing infrastructure. Fees will be used on projects that will mitigate the impact of growth on the transportation system. The Six-Year Capital Facility Plan was developed in 2003. This plan takes into account general planning goals and policies, as well as land use infrastructure requirements, identified in longer range planning documents. Generally, this plan reflects the proposed new capacity, replacement, and rehabilitation of capital facilities and related financing for the period from 2003 to 2008. An addendum was then published with a revised time frame of 2004 to 2009. D. IMPROVE QUALITY OF LIFE FOR AUBURN CITIZENS The City continues to plan and develop park and recreation facilities. During 2003, the parks department began maintenance and operation of a new 15-acre community park in the Lakeland development; installed a computerized irrigation control system to reduce water consumption; constructed a new youth ball field at GSA Park; and expanded the teen Youth Council program. This past year, roof repairs were completed for original masonry hangars at the Auburn airport, deteriorated headers were replaced on several older hangars, and an FAA grant was secured to fund 90% of the cost to rehabilitate the runway pavement and construct a north-end runup area. The City also negotiated a contract with Airport Management Group to manage the airport operations. E. PROVIDE SOUND ADMINISTRATION OF ALL CITY PROGRAMS AND AFFAIRS In 2003 the City's Finance department again worked to receive the Certificate of Achievement for Excellence in Financial Reporting from the Government Finance Officer's Association (this award has been received every year since 1987). All funds have been undergoing monitoring by the Finance department for problems and inconsistencies. The record of excellent bond ratings, audits, and reports continued to be a priority in 2003. In addition, staff prepared for the conversion to the "GASB 34" reporting structure, in which, for the first time, city-wide results will be presented using the same accounting principals as applied in private industry. 10 Ý×ÌÇ ÑÚ ßËÞËÎÒæ îððí ÝßÚÎ ÔÛÌÌÛÎ ÑÚ ÌÎßÒÍÓ×ÌÌßÔ ×Êò Ú×ÒßÒÝ×ßÔ ×ÒÚÑÎÓßÌ×ÑÒ ßò ÝßÍØ ÓßÒßÙÛÓÛÒÌ Ì¸» Ý·¬§ ·²ª»¬ ·² ËòÍò Ì®»¿«®§ ¿²¼ ß¹»²½§ ×«»ô Ð®·³» Þ¿²µ»® ß½½»°¬¿²½»ô Ì·³» Ü»°±·¬ô ¿²¼ Î»°«®½¸¿» ß¹®»»³»²¬ò ×²ª»¬³»²¬ °±´·½·» ¿²¼ °®±½»¼«®»ô »¬¿¾´·¸»¼ ¾§ ¬¸» Ó¿§±® ¿²¼ ¿¼±°¬»¼ ¾§ ¬¸» Ý·¬§ Ý±«²½·´ô ®»¯«·®» ¬¸» Ý·¬§ ¬± »¬¿¾´·¸ ¿ ¬®«¬»» ¬± ¬¿µ» ¼»´·ª»®§ ±º ¿´´ ·²ª»¬³»²¬ ¬®¿²¿½¬·±² ¿¬ ¬·³» ±º °¿§³»²¬ò Ì¸» Ý·¬§ ¸¿ ½±²¬®¿½¬»¼ ©·¬¸ ¬¸» Þ¿²µ ±º Ò»© Ç±®µ ¬± °®±ª·¼» ¼»´·ª»®§ ª»®« °¿§³»²¬ ¬®«¬»» »®ª·½» ±² ¿´´ ·²ª»¬³»²¬ò Ì¸» Í¬¿¬» ±º É¿¸·²¹¬±² ³¿·²¬¿·² ¿² ·²ª»¬³»²¬ °±±´ ¬± °®±ª·¼» »½±²±³·» ±º ½¿´» ·² ·²ª»¬·²¹ ¬± ³¿´´»®ó ¿²¼ ³»¼·«³ó·¦»¼ ½·¬·» ·² ¬¸» Í¬¿¬»ò Ì¸» Ý·¬§ «» ¬¸· »®ª·½» º±® ¿´´ º«²¼ ²±¬ ·²ª»¬»¼ ·² ´±²¹»®ó¬»®³ »½«®·¬·»ò Ì¸» °±±´ ±°»®¿¬» «²¼»® ¬¸» ¿³» ´»¹¿´ ®»¬®·½¬·±² ¬¸¿¬ ¿°°´§ ¬± ¿´´ ³«²·½·°¿´·¬·» ·² ¬¸» Í¬¿¬» ¿²¼ô ½±²»¯«»²¬´§ô «» ¬¸» ¿³» ·²¬®«³»²¬ ¿ ´·¬»¼ ¿¾±ª»ò Ì¸» Í¬¿¬» ¿´± ¬¿µ» ¼»´·ª»®§ ±º ¿´´ ·²ª»¬³»²¬ ¬®¿²¿½¬·±²ò Ì¸» Ý·¬§ ¸¿ ¿¼±°¬»¼ ¿ ½±³°®»¸»²·ª» ·²ª»¬³»²¬ °±´·½§ ¬¿¬»³»²¬ ¬± ¹«·¼» Ý·¬§ ·²ª»¬³»²¬ °®¿½¬·½»ò Ì¸»» °±´·½·» ¿®» ½´±»´§ °¿¬¬»®²»¼ ¿º¬»® ¬¸» ®»½±³³»²¼¿¬·±² ·² ×²ª»¬·²¹ Ð«¾´·½ Ú«²¼ °«¾´·¸»¼ ¾§ ¬¸» Ù±ª»®²³»²¬ Ú·²¿²½» Ñºº·½»® ß±½·¿¬·±² øÙÚÑß÷ò ×²ª»¬³»²¬ ¿®» ®»¬®·½¬»¼ ¬± ´» ¬¸¿² ¬¸®»» §»¿® ·² ±®¼»® ¬± ³¿·²¬¿·² ´·¯«·¼·¬§ ±² ¿´´ ·²ª»¬³»²¬ ·² ¿´´ º«²¼ô §»¬ »²¿¾´» ¬¸» Ý·¬§ ¬± ¬¿µ» ¿¼ª¿²¬¿¹» ±º ¬¸» §·»´¼ ½«®ª»ò Ú·¼«½·¿®§ º«²¼ô ©¸·½¸ ·²ª±´ª» ´±²¹ó¬»®³ ®»»®ª» ¿²¼ ®»¯«·®» ³·²·³¿´ ´·¯«·¼·¬§ô ¿®» ·²ª»¬»¼ º±® ´±²¹»® ¬·³» °»®·±¼ò Ì¸» Ý·¬§ «²¼»®¬¿µ» ®»°«®½¸¿» ¿¹®»»³»²¬ ±²´§ ©·¬¸ º·²¿²½·¿´ ·²¬·¬«¬·±² ¬¸¿¬ ±ºº»® ¬¸» Ý·¬§ º«´´ °®±¬»½¬·±² ·² ¬¸» »ª»²¬ ±º ¼»º¿«´¬ô ¾§ °®±ª·¼·²¹ ¬¸» ¼»´·ª»®§ ±º ¬¸» «²¼»®´§·²¹ »½«®·¬§ ¬± ¬¸» Ý·¬§ò Ü«®·²¹ ïççéô ¬¸» Ý·¬§ ®»½»·ª»¼ ¬¸» Ý»®¬·º·½¿¬·±² ±º Û¨½»´´»²½» ß©¿®¼ º®±³ ¬¸» Ó«²·½·°¿´ Ì®»¿«®»® ß±½·¿¬·±² ±º ¬¸» Ë²·¬»¼ Í¬¿¬» ¿²¼ Ý¿²¿¼¿ ±² ¬¸· °±´·½§ò Ì¸» Ý·¬§ ·²ª»¬³»²¬ ¿¬ Ü»½»³¾»® îððí ¬±¬¿´»¼ üéè ³·´´·±²ò Ì¸» Ý·¬§ »¿®²»¼ ¿² ¿ª»®¿¹» §·»´¼ ±º ïòíçûô »¿®²·²¹ üïôðêéôïðï ·² ·²ª»¬³»²¬ ·²½±³» ¼«®·²¹ îððíò Þò Î×ÍÕ ÓßÒßÙÛÓÛÒÌ ïò Ì§°» ¿²¼ Ô»ª»´ ±º Î·µ ß«³»¼ Ì¸» Ý·¬§ °¿®¬·½·°¿¬» ·² ¬¸» É¿¸·²¹¬±² Ý·¬·» ×²«®¿²½» ß«¬¸±®·¬§ ø¿² ·²«®¿²½» °±±´ ±º ±ª»® èð ½·¬·»÷ò Ì¸» Ý·¬§ ¿½¬·ª»´§ °«®«» ®·µ ®»¼«½¬·±² ·² ¬¸» ±°»®¿¬·±² ±º ·¬ °®±¹®¿³ò Ì¸» Ý·¬§ °«®½¸¿»ô ©·¬¸ »³°´±§»» °¿®¬·½·°¿¬·±²ô ³±¬ ±º ·¬ ¸»¿´¬¸ ·²«®¿²½» º±® ·¬ »³°´±§»» ¬¸®±«¹¸ ½±³³»®½·¿´ °±´·½·» ¿¼³·²·¬»®»¼ ¾§ ¬¸» ß±½·¿¬·±² ±º É¿¸·²¹¬±² Ý·¬·»ò Û³°´±§»» ®»°®»»²¬»¼ ¾§ ¬¸» Ì»¿³¬»® Ë²·±² ¸¿ª» ·²«®¿²½» ¬¸®±«¹¸ ¬¸» Ì»¿³¬»® ±®¹¿²·¦¿¬·±²ò Ì¸» Ý·¬§ °¿®¬·½·°¿¬» ·² ¬¸» É¿¸·²¹¬±² Í¬¿¬» É±®µ»® Ý±³°»²¿¬·±² °®±¹®¿³ò ×² ±®¼»® ¬± µ»»° ·¬ ´±²¹ó¬»®³ ±°¬·±² ±°»²ô ¿²¼ ¬± °®±ª·¼» º±® ¿²§ «²·²«®»¼ ´±» ¬¸¿¬ ³·¹¸¬ ±½½«®ô ¬¸» Ý·¬§ ¸¿ »´»½¬»¼ ¬± ¾«·´¼ ¿² ·²«®¿²½» ®»»®ª» ø¬¸» ×²«®¿²½» º«²¼÷ò Ì¸» ×²«®¿²½» º«²¼ «°°´»³»²¬ ª¿®·±« ·²«®¿²½» ½±ª»®¿¹» ³¿·²¬¿·²»¼ ¾§ ¬¸» Ý·¬§ò Ì¸· º«²¼ · ¿´± «»¼ ¬± »´ºó·²«®» ±³» ´·³·¬»¼ »¨°±«®»ô ¬¸» ³±¬ ·¹²·º·½¿²¬ ±º ©¸·½¸ · ¿½½·¼»²¬¿´ ´± ¬± Ý·¬§ó±©²»¼ ª»¸·½´»ò îò Î·µ Ý±²¬®±´ Ð±´·½·» Ì¸» É¿¸·²¹¬±² Ý·¬·» ×²«®¿²½» ß«¬¸±®·¬§ ²±¬ ±²´§ °®±ª·¼» ¿ ¸¿®·²¹ ±º ®·µ ¾§ °±±´·²¹ ±º ´±»ô ·¬ ¿´± °®±ª·¼» ¿² »¨¬»²·ª» ¿®®¿§ ±º °®±º»·±²¿´ »®ª·½» ·² ®·µ ³¿²¿¹»³»²¬ò Ì¸» °±±´ ³±²·¬±® ¬¸» Ý·¬§ ³¿²¿¹»³»²¬ °®¿½¬·½» ¿²¼ ¼¿³¿¹» ½´¿·³ò Ì¸» Ý·¬§ º±´´±© ¬¸» ¹«·¼»´·²» °®±ª·¼»¼ ¾§ ¬¸» °±±´ ·² ¿² »ºº±®¬ ¬± ³·²·³·¦» ®·µ »¨°±«®» ·² ¬¸» ¼¿§ó¬±ó¼¿§ ±°»®¿¬·±² ±º ¬¸» Ý·¬§ °®±¹®¿³ò Ì¸» Ý·¬§ ¿´± ³¿·²¬¿·² ¿² »¨¬»²·ª» »³°´±§»» ¿º»¬§ °®±¹®¿³ ³¿²¿¹»¼ ¾§ ¬¸» Ø«³¿² Î»±«®½» ¼»°¿®¬³»²¬ò ïï CITY OF AUBURN: 2003 CAFR LETTER OF TRANSMITTAL C. FUTURE FISCAL ISSUES AND CONSIDERATIONS 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 1996, 1998, 2000, 2001, and in 2002. All rate increases were applied as a result of a cost-of-service study. A cost-of-service study was updated for the Sewer Utility and rates increased in January 2000, 2001, and 2002 to ensure the ongoing operational health of the fund. The City completed a cost-of-service study for the Storm Drainage Utility in 1999 and new rates went into effect late 2000 and again in 2001. Conservative budgeting and fiscal practices are still very much in order for the future. Although Auburn is experiencing significant growth at the present time, perhaps unprecedented, the need for accompanying services and facilities will be considerable. The SuperMall generates annually approximately $1.5 million, with a possibility of as much as $3 million, of additional General fund revenues. Other development will generate relatively less, and projected needs for services and infrastructure including police, fire, and emergency response are considerable. Washington State voters approved an initiative in the fall of 2001 to limit property taxes to the lesser of 1°Æ> or inflation. The impact of this initiative is exponential with the impact in 2002 being $100,000 and reaching an annual amount of $1.2 million in seven years. This initiative will impact the City if economic growth does not continue at the same pace as previous years. The cost of doing business, and labor contracts are anticipated to continue growing annually in excess of 10/0. To summarize, revenue increases from development and an expanding economy must be monitored carefully in relation to the economic trends in the region, as well as the country as a whole. Services must be increased carefully as the need develops and balanced carefully against available resources. Adequate reserves have been maintained to-date and it is likely to be utilized to some extent in the near future to offset recent downturns in economic circumstances. Additional tax capacity is available to the City. However, it must be used very cautiously and only for significant expansions in levels of service that bring value to the City, and justify generation of sufficient revenue for repayment. V. 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 2003 financial audit of the City now has been completed 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 2003. Please 12 CITY OF AUBURN: 2003 CAFR LETTER OF TRANSMITTAL 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 of Excellence in Financial Reporting to the City of Auburn for its Comprehensive Annual Financial Report for the fiscal year ended December 31, 2002. This was the fourteenth 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. 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 requirement and we are submitting it to the GFOA to determine its eligibility for another certificate. 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 13 14 Ý×ÌÇ ÑÚ ßËÞËÎÒæ îððí ÝßÚÎ ÝÛÎÌ×Ú×ÝßÌÛ ÑÚ ßÝØ×ÛÊÛÓÛÒÌ ïë 16