2011 CAFR.pdfCOMPREHENSIVE
ANNUAL FINANCIAL REPORT
Fiscal Year Ended September 30, 2011
The Village of
North Palm Beach, FL
The Village of
North Palm Beach, Florida
COMPREHENSIVE ANNUAL FINANCIAL REPORT
Fiscal Year Ended September 30, 2011
Prepared by:
Finance Department
Samia Janjua
Director of Finance
THE VILLAGE OF NORTH PALM BEACH, FLORIDA
FINANCIAL STATEMENTS
SEPTEMBER 30, 2011
TABLE OF CONTENTS
INTRODUCTORY SECTION
Letter of Transmittal ..................................................................................................................................... i
List of Principal Village Officials ............................................................................................................ vii
Organization Chart ................................................................................................................................... viii
GFOA Certificate of Achievement for Excellence in Financial Reporting ................................................ ix
FINANCIAL SECTION
Independent Auditors' Report ....................................................................................................................... 1
Management's Discussion and Analysis ....................................................................................................... 3
BASIC FINANCIAL STATEMENTS:
Government-wide Financial Statements:
Statement of Net Assets ....................................................................................................................... 13
Statement of Activities ......................................................................................................................... 14
Fund Financial Statements:
Balance Sheet - Governmental Funds .................................................................................................. 16
Reconciliation of the Balance Sheet – Governmental Funds
to the Statement of Net Assets ....................................................................................................... 17
Statement of Revenues, Expenditures and Changes in
Fund Balances - Governmental Funds ........................................................................................... 18
Reconciliation of the Statement of Revenues, Expenditures, and Changes in
Fund Balances of the Governmental Funds to the Statement of Activities .................................... 19
Statement of Net Assets - Proprietary Fund ......................................................................................... 20
Statement of Revenues, Expenses, and Changes in Net
Assets - Proprietary Fund ............................................................................................................... 21
Statement of Cash Flows - Proprietary Fund ....................................................................................... 22
Statement of Fiduciary Net Assets - Fiduciary Funds .......................................................................... 23
Statement of Changes in Fiduciary Net Assets – Fiduciary Funds ...................................................... 24
Notes to the Basic Financial Statements ..................................................................................................... 25
REQUIRED SUPPLEMENTARY INFORMATION:
Schedule of Funding Progress- Other Post Employment Benefits ........................................................ 63
Schedule of Funding Progress – Retirement Funds .............................................................................. 64
Schedule of Employer and State Contributions ................................................................................... 65
Notes to the Trend Data ....................................................................................................................... 66
Schedule of Revenues, Expenditures, and Changes in Fund Balance -
Budget and Actual - General Fund ................................................................................................. 67
Notes to the Budgetary Required Supplementary Information ............................................................ 68
THE VILLAGE OF NORTH PALM BEACH, FLORIDA
FINANCIAL STATEMENTS
SEPTEMBER 30, 2011
TABLE OF CONTENTS
(Continued)
OTHER SUPPLEMENTARY INFORMATION:
Schedule of Departmental Expenditures– Budget and Actual – General Fund .................................... 69
Combining Balance Sheet – Nonmajor Governmental Funds .............................................................. 72
Combining Statement of Revenues, Expenditures, and Changes in Fund Balances -
Nonmajor Governmental Funds ........................................................................................................ 73
Combining Statement of Net Assets - Fiduciary Funds ....................................................................... 74
Combining Statement of Changes in Fiduciary Net Assets - Employee Retirement Funds ................ 75
Combining Statement of Agency Net Assets ....................................................................................... 76
Combining Schedule of Changes in Agency Net Assets and Liabilities ............................................... 77
Schedule of Departmental Expenses – Budget and Actual – Country Club Fund – Budgetary Basis .. 78
STATISTICAL SECTION
Net Assets by Component .................................................................................................................... 79
Changes in Net Assets .......................................................................................................................... 80
Fund Balances, Governmental Funds ................................................................................................... 82
Changes in Fund Balances, Governmental Funds ................................................................................ 83
Net Assessed Value and Estimated Actual Value of Taxable Property ............................................... 85
Property Tax Rates - Direct and Overlapping Governments................................................................. 86
Principal Property Taxpayers ............................................................................................................... 87
Property Tax Levies and Collections ................................................................................................... 88
Ratios of Outstanding Debt by Type ..................................................................................................... 89
Direct and Overlapping Governmental Activities Debt ........................................................................ 90
Pledged-Revenue Coverage .................................................................................................................. 91
Demographic and Economic Statistics .................................................................................................. 92
Principal Employers ............................................................................................................................. 93
Full-Time Equivalent Village Government Employees by Function .................................................... 94
Operating Indicators by Function/Program .......................................................................................... 95
Capital Asset Statistics by Function/Program ....................................................................................... 96
REQUIRED REPORTS
Report on Internal Control Over Financial Reporting and on
Compliance and Other Matters Based on an Audit of Financial
Statements Performed in Accordance with Government Auditing Standards .................................. 97
Management Letter in Accordance with the Rules of the Auditor General of the
State of Florida ................................................................................................................................. 99
INTRODUCTORY SECTION
THE VILLAGE OF
NORTH PALM BEACH
“THE BEST PLACE TO LIVE UNDER THE SUN”
501 U.S. Highway 1, North Palm Beach, FL 33408-4902 * (561) 841-3380 * Fax (561) 848-3344
March 22, 2012
The Honorable Mayor and Members of the Village Council
Village of North Palm Beach
North Palm Beach, Florida
The Finance Department and Village Manager's Office are pleased to submit the Comprehensive
Annual Financial Report for the Village of North Palm Beach, Florida for the fiscal year ended
September 30, 2011.
This report is published to provide the Village Council, Village staff, our citizens, our lenders, and other
interested parties with detailed information concerning the financial condition and activities of the
Village government. Responsibility for both the accuracy of the presented data and the completeness
and fairness of the presentation, including all disclosures, rests with the Village.
To the best of our knowledge and belief, the enclosed data are accurate in all material respects, and
are organized in a manner designed to fairly present the financial position and results of operations of
the Village as measured by the financial activity of its various funds. We also believe that all disclosures
necessary to enable the reader to gain the maximum understanding of the Village's financial affairs
have been included.
THE REPORT
Nowlen, Holt & Miner, P.A., Certified Public Accountants, have issued an unqualified (“clean”) opinion
on the Village of North Palm Beach’s financial statements for the year ended September 30, 2011. The
independent auditor’s report is located at the front of the financial section of this report.
Management’s Discussion and Analysis (MD&A) immediately follows the independent auditor’s report
and provides a narrative, overview, and analysis of the basic financial statements. MD&A complements
this letter of transmittal and should be read in conjunction with it.
The CAFR’s role is to assist in making economic, social and political decisions and to assist in
assessing accountability to the citizenry by:
· comparing actual financial results with the legally adopted budget, where appropriate;
· assessing financial condition and results of operations;
· assisting in determining compliance with finance related laws, rules and regulations;
· assisting in evaluating the efficiency and effectiveness of Village operations.
ii
VILLAGE PROFILE
The Village
The Village of North Palm Beach is primarily a residential community, having been incorporated as a
political subdivision of the State of Florida in 1956. The registered population of the Village is
approximately 13,000 which increases to approximately 18,000 during the winter months by residents
who list their northern homes as their official place of residence. Residents are generally in the middle
to upper income brackets.
Located in the northeastern quadrant of Palm Beach County, Florida, the Village has an abundant
amount of waterfront property created by a number of lakes, canals, and the Atlantic Ocean.
The governing body of the Village consists of a five member Village Council, each of whom is elected to
two-year overlapping terms. The Mayor is selected by majority vote of the Council and serves for a term
of one year. Day to day affairs of the Village are under the leadership of the Village Manager who is
appointed by the Council.
FINANCIAL DATA
Financial Reporting System and Budgetary Controls
The Village's financial records for its general governmental operations are maintained on the modified
accrual basis, which means that revenues are recorded when available and measurable, and
expenditures are reported when goods and services are received and the related liabilities are incurred.
Financial reporting for its Enterprise Fund (i.e., the Country Club operation) is presented using the full
accrual basis of accounting required by GAAP for its annual financial report. The Country Club annual
budget is adopted using a modified accrual basis of accounting (identical to the general government
operations mentioned above) which is consistent with how general ledger financial records are
maintained throughout the year by the Village administration.
In developing and evaluating the Village's financial and accounting system, consideration is given to the
adequacy of internal accounting controls. Internal accounting controls are designed to provide
reasonable, but not absolute, assurance regarding: (a) the safeguarding of assets against loss from
unauthorized use or disposition; and (b) the reliability of financial records for preparing financial
statements and maintaining accountability for assets. The concept of reasonable assurance recognizes
that: (a) the cost of a control should not exceed the benefits likely to be derived; and (b) the evaluation
of costs and benefits requires estimates and judgments by management.
All internal control evaluations occur within the above framework. We believe that the Village's internal
accounting controls adequately safeguard assets and provide reasonable assurance of proper
recording of financial transactions.
The Village of North Palm Beach maintains budgetary controls through the annual budget public
hearing and approval process for GAAP-based budgets. The formal budget approval for each fiscal
year is accomplished in a manner compliant with Florida State Statute 200.065, commonly referred to
as Truth-in-Millage (TRIM).
Budget amendments require Village Council approval at public meetings. Budgetary control is
maintained at the department level within the fund by the encumbrance of estimated purchase amounts
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prior to the release of purchase orders to vendors. Purchase orders, which result in an overrun of
approved departmental appropriations within the fund, are not released until additional appropriations
are made available. Encumbered amounts lapse at year-end; however, they are re-appropriated as part
of the following year’s budget.
ECONOMIC OUTLOOK
Property Values
The Village obtains a major portion of its annual General Fund financial resources (56%) from ad
valorem property taxes. Gross assessed property values increased substantially between the years of
2002 through 2006 but slowed significantly in 2007. In years 2008 through 2011 area property values
declined in value, in many instances significantly, as a result of the economic downturn. This
unprecedented decline in property values is only exacerbated by the number of properties in various
stages of foreclosure. Both of these real-estate issues have had and continue to have an adverse
impact upon the financial resources of the Village. The Village does not anticipate a change in the pace
of planned new growth since most vacant property within the municipal limits has already been
developed. There continues to be an obvious softening of the real-estate market significantly impacting
both home values and sales.
The Village’s property tax valuation continues to be negatively impacted since the passing of
Amendment One (Property Tax Reform) in January 2008! Three primary factors play a role in that
impact: doubling the Homestead exemptions to fifty thousand dollars; the capping of assessed property
values for homes not currently homesteaded; and portability. Political discussions continue regarding
alternative taxations which make future forecasts of Village property tax valuation uncertain.
The Village will continue to pursue annexation of surrounding unincorporated areas that complement
and enhance the services and values of our existing community. The focus of Village annexation
efforts will be providing exemplary municipal services that are revenue “neutral” to both the annexed
areas and to the Village.
Investment Revenues:
The economic downturn and softening of the Money Market continues to have significant
consequences on the Village’s investment revenues. In the short-term, the Village made a conscious
decision to modify its investment strategies towards the Treasury Market to better protect and ensure
the availability of the Village’s investment balances. This move proved successful in safeguarding
Village investments during this Market freefall but impacted the interest/dividend revenues to the
Village. Four years ago, the Village adopted, with the assistance of the Village’s Audit Committee, a
“revised” Investment Policy designed to provide safety and liquidity while maximizing investment
return(s). The newly adopted policy provides numerous investment strategies, parameters, and
safeguards. The policy additionally provides for 1/12 of its annual operating budget to be deposited in a
liquid interest bearing account so as not to impede operations should other funds be temporarily
unavailable.
Personnel Costs
The Village will continue to face challenges primarily in areas of increased personnel costs for both
salaries and benefits as well as increased insurance and energy costs. In past years, several
retirement plan amendments were implemented by the Village and then followed by significant salary
adjustments that magnified the impact and cost of the retirement changes. The combination of these
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changes resulted in significant increases to - and continuing requirements for - annual Village pension
costs. The Village has also encountered significant increases in annual health insurance costs during
the past few years. In 2005, the Village transitioned away from its self-insured health program to a
contractual, fixed-fee Health/Dental program. This new health program more accurately reflects and
contains annual Village costs while re-establishing a cost-sharing partnership with employees by
adjusting the amount of their annual contribution for health coverage.
Agreements for all three of the Village’s collective bargaining units (police, fire, and public service
workers) were successfully bargained and ratified during fiscal year 2010. All Collective Bargaining
Agreements will run through September 30, 2013. All wage provisions “sunset” each year and must be
renegotiated pursuant to the annual re-opener provisions outlined in the respective Collective
Bargaining Agreements thereby giving the Village a more accurate means by which to calculate future
year salaries and benefit costs.
The impacts of personnel salaries and benefits in the coming years will have a large and continuing
effect on future Village financing and service priorities in the areas of staffing, public services and public
projects.
INITIATIVES AND FUTURE PROJECTS
The FY2011/2012 budget reflects a renewed commitment and predictable funding for community
infrastructure in areas such as roadways, neighborhood sidewalks and lighting, public buildings, and
park facilities.
The Community Development Department continues to meet the unending demands of our Village’s
business and neighborhood redevelopment. Community Development will continue to concentrate staff
resources in areas of construction, permitting, licensing, and community planning while reinforcing
improvements in customer service. The continuing analysis and pursuit of annexation opportunities,
zoning and redevelopment enhancements and improvement of our business and development
regulations is also a function of the Community Development Department. This Department will better
align our Village with statutory development guidelines and help to meet steadily growing expectations
of homeowners and developers.
The Parks and Recreation Department continues to enhance programs for all age groups and at each
of the six facilities. The newly redeveloped Anchorage Park will host a variety of events in this
upcoming year to include: movies in the park; organized volleyball leagues; the Village’s annual fishing
tournament; and Heritage day. The parks continue to be maintained by an outside service which has
been funded under the “contractual services” line.
The Village will be looking to make grant application in FY2012 at both the state and federal levels to
offset costs associated with the continuation of a walking path to the north side of Anchorage Park. The
Village will also seek to expand the (recreational vehicle) “dry storage” area at Anchorage Park to
accommodate those residents currently awaiting availability. Additionally, the Village will make
reapplication to FRDAP seeking a $50,000 non-matching grant to erect a “Veterans Memorial” to the
rear of Village Hall and adjacent to the Public Library.
v
The Public Works Department is planning to continue oversight and maintenance of Village sanitation,
infrastructure, streets, facilities, equipment, and roadways. This Department will focus on and play a
major role in maintaining and expanding our focus on community appearance during the coming year.
Public Works improvements include funding for the replacement of A/C chiller units at Village Hall and
Public Safety. These A/C units are showing severe signs of wear and tear and could pose significant
disruption to the Village should there be an unanticipated failure. The replacement cost for these two
units is $111,600. Public Works also plans to take steps to improve neighborhood lighting in areas
identified as having acute need throughout the Village. Roadway appearance will be emphasized with
improved median and swale plantings.
Northlake Boulevard Corridor Task Force: An initial $500,000 grant from the State DOT allowed the
Village to award a local company the bid for construction of Phase 1 of the Northlake Boulevard
streetscape improvement. This first phase provided sidewalk widening and median/swale area
landscaping improvements from US1 westward to Southwind Drive. Replacement of deficient
vegetation was completed in February 2007. Implementation of Phase II which extends from Southwind
Drive westward to Alternate A1A got underway in FY2011 and will be completed sometime early 2012.
The Police Department has continued improvements in neighborhood outreach, crime suppression, and
crime clearances. In 2008, and again in 2011, the Village’s Police Department was awarded the
coveted CALEA National Accreditation for law enforcement agencies. The Police budget includes
funding for the purchase/replacement of needed marked patrol vehicles.
The Human Resources Department, over this past year, assisted with workforce reduction strategies,
employee healthcare procurement, and risk management. Union related matters were also
successfully addressed with emphasis placed on legal reporting and the providing for a consistent
managerial oversight of all Village personnel matters. With the acquisition of the Restaurant at the
Country Club, new staff hiring and processing continues to task this relatively small department.
The Administration continues with its implementation of an optical records storage system which will be
ongoing. This system will be used by all Village operating departments (Community Development,
Finance, Human Resources, and Country Club). Optical record storage systems are now widely used
by governments and meet all State record storage requirements. This allows the Village to transition –
over time – from “paper” records to optically stored records. Optical storage permits digital “look up” of
any optical record “at will” through the convenience of a simple computer search. Optical storage
systems have become commonly used by many local governments, and the cost is relatively modest
when considering the time savings and customer service improvements they offer.
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OTHER INFORMATION
Independent Audit
Article 11, Section 2.18 of the Village Charter requires an annual audit of the books of account, financial
records and transactions of all administrative departments of the Village by independent certified public
accountants selected by the Village Council. This requirement has been complied with and the
independent auditor's report has been included in this report.
Certificate of Achievement
The Government Finance Officers Association of the United States and Canada (GFOA) awarded a
Certificate of Achievement of Excellence in Financial Reporting to the Village of North Palm Beach
for its Comprehensive Annual Financial Report for the fiscal year ended September 30, 2010. The
Certificate of Achievement is a prestigious national award, recognizing conformance with the highest
standards for preparation of state and local government financial reports.
vii
THE VILLAGE OF NORTH PALM BEACH, FLORIDA
PRINCIPAL VILLAGE OFFICIALS
SEPTEMBER 30, 2011
Title Name
Mayor Darryl C. Aubrey
Vice Mayor David B. Norris
President Pro Tem William L. Manuel
Council Member Robert A. Gebbia
Council Member T.R. Hernacki
Village Manager James Titcomb
Director of Finance Samia Janjua
Village Clerk Melissa Teal
THE VILL
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“•••
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FINANCIAL SECTION
1
INDEPENDENT AUDITORS’ REPORT
The Honorable Mayor and Members of the Village Council
The Village of North Palm Beach, Florida
We have audited the accompanying financial statements of the governmental activities, the
business-type activities, each major fund, and the aggregate remaining fund information of the
Village of North Palm Beach, Florida as of and for the year ended September 30, 2011, which
collectively comprise the Village’s basic financial statements as listed in the table of contents.
These financial statements are the responsibility of the Village of North Palm Beach, Florida's
management. Our responsibility is to express opinions on these financial statements based on
our audit.
We conducted our audit in accordance with U.S. generally accepted auditing standards and the
standards applicable to financial audits contained in Government Auditing Standards, issued by
the Comptroller General of the United States. Those standards require that we plan and perform
the audit to obtain reasonable assurance about whether the financial statements are free of
material misstatement. An audit includes examining, on a test basis, evidence supporting the
amounts and disclosures in the financial statements. An audit also includes assessing the
accounting principles used and significant estimates made by management, as well as evaluating
the overall financial statement presentation. We believe that our audit provides a reasonable
basis for our opinions.
In our opinion, the financial statements referred to above present fairly, in all material respects,
the respective financial position of the governmental activities, the business-type activities, each
major fund, and the aggregate remaining fund information of the Village of North Palm Beach,
Florida as of September 30, 2011, and the respective changes in financial position, and cash
flows, where applicable, thereof for the year then ended in conformity with U.S. generally
accepted accounting principles.
In accordance with Government Auditing Standards, we have also issued our report dated
March 13, 2012, on our consideration of the Village of North Palm Beach, Florida’s internal
control over financial reporting and on our tests of its compliance with certain provisions of laws,
regulations, contracts, grant agreements and other matters. The purpose of that report is to
describe the scope of our testing of internal control over financial reporting and compliance and
2
the results of that testing, and not to provide an opinion on the internal control over financial
reporting or on compliance. That report is an integral part of an audit performed in accordance
with Government Auditing Standards and should be read in conjunction with this report in
considering the results of our audit.
Accounting principles generally accepted in the United States of America require that the
management’s discussion and analysis on pages 3 through 12, Pension and Other Post
Employment Benefit trend information on pages 63 through 66, and budgetary comparison
information on pages 67 through 68 be presented to supplement the basic financial statements.
Such information, although not a part of the basic financial statements, is required by the
Governmental Accounting Standards Board, who considers it to be an essential part of financial
reporting for placing the basic financial statements in an appropriate operational, economic, or
historical context. We have applied certain limited procedures to the required supplementary
information in accordance with auditing standards generally accepted in the United States of
America, which consisted of inquiries of management about the methods of preparing the
information and comparing the information for consistency with management’s responses to our
inquiries, the basic financial statements, and other knowledge we obtained during our audit of the
basic financial statements. We do not express an opinion or provide any assurance on the
information because the limited procedures do not provide us with sufficient evidence to express
an opinion or provide any assurance.
Our audit was conducted for the purpose of forming opinions on the financial statements that
collectively comprise the Village of North Palm Beach, Florida’s financial statements as a whole.
The introductory section, other supplemental information and statistical section, are presented for
purposes of additional analysis and are not a required part of the financial statements. The other
supplemental information are the responsibility of management and were derived from and relate
directly to the underlying accounting and other records used to prepare the financial statements.
The information has been subjected to the auditing procedures applied in the audit of the
financial statements and certain additional procedures, including comparing and reconciling such
information directly to the underlying accounting and other records used to prepare the financial
statements or to the financial statements themselves, and other additional procedures in
accordance with auditing standards generally accepted in the United States of America. In our
opinion, the information is fairly stated in all material respects in relation to the financial
statements as a whole. The introductory and statistical sections have not been subjected to the
auditing procedures applied in the audit of the basic financial statements and, accordingly, we do
not express an opinion or provide any assurance on them.
March 13, 2012
West Palm Beach, Florida
3
MANAGEMENT'S DISCUSSION AND ANALYSIS
The Village of North Palm Beach, Florida’s (Village) Administration offers readers of the Village's
financial statements this narrative overview and analysis of the financial activities of the Village for the
fiscal year ended September 30, 2011. Please read it in conjunction with the accompanying transmittal
letter beginning on page i, and the accompanying basic financial statements.
TABLE 1
FINANCIAL HIGHLIGHTS
(in millions)
September 30,Increase/Statement
2011 2010 (Decrease)Page #
Total net assets $32.14 $31.84 $0.30 13
Unrestricted net assets available for future use $12.16 $10.97 $1.19 13
Governmental net assets $29.56 $29.14 $0.42 13
Total revenues from all sources $21.92 $22.66 ($0.74)14
Governmental revenues $18.35 $19.37 ($1.02)14
Total cost of all Village programs $21.62 $21.62 $0.00 14
Governmental revenues over (under) expenses $0.42 $1.15 ($0.73)15
General fund revenues over (under) expenses $1.98 $0.60 $1.38 18
General fund unassigned fund balance $10.68 $10.44 $0.24 16
As a percent of general fund expenditures 64.35%55.45%(0.11)
Country Club revenues over (under) expenses ($0.11)($0.10)($0.01)21
Change in total long-term debt for the Village ($0.31)($2.40)$2.09
USING THIS ANNUAL REPORT
This annual report consists of a series of financial statements. The three components of the financial
statements are: (1) Government-wide financial statements that include the Statement of Net Assets and
the Statement of Activities. These statements provide information about the activities of the Village as a
whole. (2) Fund financial statements tell how these services were financed in the short term, as well as
what remains for future spending. Fund financial statements also report the Village's operations in more
detail than the government-wide statements by providing information about the Village's most significant
funds. (3) Notes to the basic financial statements expand upon information reported in the government-
wide and governmental fund statements.
REPORTING THE VILLAGE AS A WHOLE
Statement of Net Assets and the Statement of Activities (Government-wide)
A frequently asked question regarding the Village's financial health is whether the year's activities
contributed positively to the overall financial well being. The Statement of Net Assets and the Statement
of Activities report information about the Village as a whole and about its activities in a way that helps
answer this question. These statements include all assets and liabilities using the accrual basis of
accounting, which is similar to the accounting used by most private-sector companies. All of the current
year's revenues and expenses are taken into account, regardless of when cash is received or paid.
4
These two statements report the Village's net assets and changes therein. Net assets, the difference
between assets and liabilities, are one way to measure the Village's financial health, or financial position.
Over time, increases or decreases in net assets are an indicator of whether the financial health is
improving or deteriorating.
The Statement of Net Assets and the Statement of Activities present information about the following:
· Governmental activities - All of the Village's basic services are considered to be governmental
activities, including general government, community development, public safety, public services,
library, and recreation. Property taxes, sales taxes, utility taxes, and franchise fees finance most of
these activities.
· Proprietary activities/Business type activities - The Village charges a fee to customers to cover all
or most of the cost of the services provided. The Village's Country Club is reported in this
category.
REPORTING THE VILLAGE'S MOST SIGNIFICANT FUNDS
Fund Financial Statements
The fund financial statements provide detailed information about the most significant funds - not the
Village as a whole. Some funds are required to be established by State law. However, management
establishes other funds, which aid in the management of money for particular purposes or meet legal
responsibilities associated with the usage of certain taxes, grants, and other money. The Village's three
kinds of funds - governmental, proprietary, and fiduciary - use different accounting approaches as
explained below.
· Governmental Funds
Most of the Village's basic services are reported in governmental funds. Governmental funds
focus on how resources flow in and out, with balances remaining at year-end that are available for
spending. These funds are reported using an accounting method called the modified accrual
accounting method, which measures cash and all other financial assets that can readily be
converted to cash. The governmental fund statements provide a detailed short-term view of the
Village's general government operations and the basic services it provides. Governmental fund
information shows whether there are more or fewer financial resources that can be spent in the
near future to finance the Village's programs.
The Village maintains six individual governmental funds: the General Fund, one Capital Projects
Fund, and four Special Revenue Funds. Information is presented separately in the governmental
fund balance sheet and in the governmental fund statement of revenues, expenditures and changes
in fund balance for the General Fund and the Capital Projects Fund, both of which are considered
major funds (generally accepted accounting principles define a fund as major based on that fund’s
size relative to the other funds of the government, or a fund may be reported as major if the
government's officials believe that fund is particularly important to financial statement users).
The remaining funds are considered non-major funds, and data from these governmental funds
are combined into a single column for an aggregated presentation. The basic governmental fund
financial statements can be found on pages 16-19 of this report.
· Proprietary Funds
The Village's only proprietary fund is the Country Club Fund, which charges customers for the
services it provides. These services are generally reported in proprietary funds. Proprietary funds
are reported in the same way that all activities are reported in the Statement of Net Assets and the
Statement of Activities. The basic proprietary fund financial statements can be found on pages
20-22 of this report.
5
· Fiduciary Funds
Fiduciary funds are used to account for resources held for the benefit of parties outside the
government. The funds in this category are the Village’s Pension Trust Funds and Agency Funds.
Fiduciary funds are not reflected in the government-wide financial statement because the
resources of those funds are not available to support the Village's own programs. The accounting
used for fiduciary funds is much like that used for proprietary funds. The basic fiduciary fund
financial statements can be found on pages 23-24 of this report.
GOVERNMENT-WIDE FINANCIAL ANALYSIS
As noted earlier, net assets may serve over time as a useful indicator of a government's financial position.
In the case of the Village, assets exceeded liabilities by $32.14 million at the close of the most recent
fiscal year.
A significant portion of the Village's net assets (60.46%) reflects its investment in capital assets (e.g.,
land, buildings, machinery, and equipment), less any related debt used to acquire those assets that is still
outstanding. The Village uses these capital assets to provide services to citizens; consequently, these
assets are not available for future spending. Although the Village's investment in its capital assets is
reported net of related debt, it should be noted that the resources needed to repay this debt must be
provided from other sources, since the capital assets themselves cannot be used to liquidate these
liabilities.
Table 2
Village of North Palm Beach
Net Assets
(In Thousands)
Governmental Business
Activities Activities Total
2011 2010 2011 2010 2011 2010
Assets:
Current and other assets 15,799$ 14,032$ 890$ 943$ 16,689$ 14,975$
Capital assets 17,237 18,184 6,219 6,621 23,456 24,805
Total assets 33,036 32,216 7,109 7,564 40,145 39,780
Liabilities:
Current liabilities 1,500 1,230 461 509 1,961 1,739
Long-term liabilities 1,974 1,843 4,061 4,357 6,035 6,200
Total liabilities 3,474 3,073 4,522 4,866 7,996 7,939
Net assets:
Invested in capital assets,
net of debt 17,237 18,184 2,201 2,295 19,438 20,479
Restricted 548 391 548 391
Unrestricted 11,776 10,568 386 403 12,162 10,971
Total net assets 29,561$ 29,143$ 2,587$ 2,698$ 32,148$ 31,841$
6
Governmental Activities
The cost of all governmental activities this year was $17.93 million. As shown on Table 3, Changes in
Net Assets, those who directly benefited from the programs paid for $2.86 million of this cost and $14.94
million was financed through general revenues. Governmental activities increased the Village's net assets
by $0.42 million, thereby accounting for 136% of the total increase in the net assets of the Village. Key
elements of this increase are as follows:
· Program revenues are higher due to expanded recreational activities.
· Due to discounts for prompt payments, State law requires that only 95% of the gross ad-valorem
taxes be budgeted as revenue ($10.22 million). For the current year, the Village received $10.44
million.
The increase in the above-mentioned revenues, while holding the line on operating costs, resulted in a
positive impact on the Village’s Governmental Activities. Additional detail is shown in Table 3, which
follows on the subsequent page.
7
Table 3
Village of North Palm Beach
Changes in Net Assets
(In Thousands)
Activities Total
2011 2010 2011 2010 2011 2010
Revenues:
Program revenues:
Charges for services 2,857$ 2,802$ 3,571$ 3,228$ 6,428$ 6,030$
Operating grants and contributions 127 97 127 97
Capital grants and contributions 5 76 5 76
General revenues:
Property taxes 10,442 11,053 10,442 11,053
Local option gas taxes 260 266 260 266
Utility service taxes 2,198 2,261 2,198 2,261
Sales and use taxes 1,141 1,115 1,141 1,115
Franchise taxes 1,191 1,204 1,191 1,204
Investment earnings 97 280 9 14 106 294
Miscellaneous 31 186 31 186
Gain on asset disposals 28 55 83
Total revenues 18,349 19,368 3,580 3,297 21,929 22,665
Expenses:
Program expenses:
General Government 2,404 2,679 2,404 2,679
Public Safety 7,233 7,304 7,233 7,304
Public Works 4,734 4,595 4,734 4,595
Community Development & Planning 811 807 811 807
Leisure Services 2,749 2,830 2,749 2,830
Interest on long-term debt 4 4
Country Club 3,691 3,398 3,691 3,398
Total expenses 17,931 18,219 3,691 3,398 21,622 21,617
Increase (decrease) in net assets 418 1,149 (111) (101) 307 1,048
Net assets - beginning of year 29,143 27,994 2,698 2,799 31,842 30,793
Net assets - end of year 29,561$ 29,143$ 2,587$ 2,698$ 32,149$ 31,841$
Governmental Business
Activities
8
The Village's programs include General Government, Public Safety, Public Works, Community
Development & Planning, and Leisure Services. Each program's net cost (total cost, less revenues
generated by the activities) is presented below. The net cost shows the extent to which the Village's
general taxes support each of the Village's programs.
Table 4
Village of North Palm Beach
Cost of services
(In Thousands)
Total Cost Net Cost Total Cost Net Cost
of Services of Services of Services of Services
General government 2,404$ (2,266)$ 2,679$ (2,547)$
Public safety 7,233 (6,773)7,304 (6,771)
Public works 4,734 (4,263)4,595 (4,132)
Community development
and planning 811 50 807 (72)
Leisure services 2,749 (1,689)2,830 (1,718)
Interest on long-term debt 4 (4)
17,931$ (14,941)$ 18,219$ (15,244)$
2011 2010
At the end of the current year, as compared to the prior year, many of the departments realized a decrease
in their overall costs (for example, General Government decreased by $0.28 million, Public Safety
decreased by $0.07 million, and Leisure Services decreased by $0.08 million). The decrease is a result of
Department Directors reducing spending to counter the decrease in revenues. Public Works realized an
increase of $0.14 million primarily due to the Village-wide street sign project.
Business Type Activities
Charges for Services (revenues) in the Business Type Activities experienced an overall increase ($0.34
million) from that of the previous year. Also, during this same time period, expenses increased by $0.29
million. Net assets of the Proprietary Fund (Country Club) at September 30, 2011, were $2.58 million.
Net assets decreased by $111,836.
The changes in Business Type Activities can be directly tied to the Village’s acquisition of the Food &
Beverage Operations (resulting in an increase in both revenues & expenses).
9
FINANCIAL ANALYSIS OF THE VILLAGE'S FUNDS
As noted earlier, the Village uses fund accounting to ensure and demonstrate compliance with finance-
related legal requirements.
Governmental Funds - The focus of the Village's governmental funds is to provide information on near-
term inflows, outflows, and balances of spendable resources. Such information is useful in assessing the
Village's financing requirements. In particular, unrestricted (unassigned/assigned) fund balance may
serve as a useful measure of a government's net resources available for spending at the end of the fiscal
year.
At the end of the current fiscal year, the combined fund balance for all Governmental Funds was $13.54
million, a $1.59 increase over the 2010 fund balance of $11.95 million. Approximately 94% of the
combined ending fund balance ($12.71 million) constitutes unrestricted (unassigned/assigned) fund
balance, which is available for spending at the government's discretion. The remainder of fund balance
($0.83 million) is restricted (non-spendable/restricted) to indicate that it is not available for new spending
because it has already been committed for a variety of other restricted purposes.
The General Fund is the chief operating fund of the Village. At the end of the current fiscal year,
unassigned fund balance of the General Fund was $10.68 million while the General Fund total fund
balance was $11.70 million. As a measure of the General Fund's liquidity, it may be useful to compare
both unassigned fund balance and total fund balance to total fund expenditures. Unassigned fund balance
is 64% of total general fund expenditures, while total fund balance represents 70% of that same amount.
The general fund unassigned fund balance ($10.68 million) represents an increase of $0.24 million over
the 2010 unassigned general fund balance of $10.44 million. Key elements of this increase are listed
below:
· Program revenues are higher due to expanded recreational activities.
· Due to discounts for prompt payments, State law requires that only 95% of the gross ad-valorem
taxes be budgeted as revenue ($10.22 million). For the current year, the Village received $10.44
million.
The increase in the above-mentioned revenues, while holding the line on operating costs, resulted in a
positive impact in the Village’s General Fund.
General Fund Budgetary Highlights
Differences between the original budget and the final amended budget were $ 951,278 and can be briefly
summarized as follows:
· Street Signs Project ($270,819)
· Community Development Software ($89,222)
· Small Business Grant Carryover ($100,000)
· Prior Year Open Purchase Order Carryover ($4,245)
· Southwest Neighborhood Project ($431,992)
· Pool Equipment Room ($55,000)
10
General Fund Budget Analysis
As shown on pages 69-71 of this report, in the Schedule of Departmental Expenditures – Budget and
Actual, there was a favorable budget to actual cost variance of $511,411 in General Fund Departmental
Expenditures. The areas of significant budget to actual variances for the General Fund expenditures are
summarized below:
· The Village realized an overall budgetary savings of $161,960 in its anticipated employee related
costs: during the budgeting process, various assumptions, along with previous year costs, are
used in the development of the current year budget. The actual costs came in well under the
projected budgeted amount.
· To counter the decrease in revenue brought about by property tax reform and the economic
downturn, the Village Manager directed Department Directors to reduce spending in a manner
that would minimize the impact on our residents. This required seeking new ways to serve our
customers. The Directors did an admirable job identifying areas to cut costs resulting in
favorable budget variances. The Village saw overall budgetary savings in operating costs of
$256,360. The areas of significant budget to actual variances for the General Fund operating
costs are summarized below:
o The Village saw overall budgetary savings in its utility costs ($86,465): the budgeted amount
included a ten percent increase for utilities, but the actual costs were well under the budgeted
amount.
o During the previous year, the Village implemented a “Small Business Grant Program” and
appropriated $100,000 from Council Contingency to fund this program. The program is
administered through the Community Development Department and is structured to provide
matching grants of up to $5,000 for improvements to small business properties. Businesses
would be required to match each dollar of grant funds with one dollar from their own funds.
Businesses must complete an application and will have to meet certain criteria to qualify. In
2011, there was only one (1) application that was approved for the Grant which resulted in a
budgetary savings ($95,000) in the Community Development Department.
CAPITAL ASSET AND DEBT ADMINISTRATION
Capital Assets
The capital assets of the Village are those assets that are used in the performance of Village functions.
Capital assets include equipment, buildings, land, and park facilities etc. The Village has elected to
retroactively apply the capitalization requirements of GASB Statement No 34 to major general
infrastructure assets acquired in fiscal years ending after June 30, 1980, or that were significantly
reconstructed or improved during that multiyear period.
The Village's investment in capital assets for its governmental and business-type activities as of
September 30, 2011 and 2010 amounts to $23.42 million and $24.76 million, respectively (net of
accumulated depreciation).
11
Table 5
Village of North Palm Beach
Capital Assets
(In Thousands)
Governmental Business
Activities Activities Total
2011 2010 2011 2010 2011 2010
Land 2,151$ 2,151$ 1,051$ 1,051$ 3,202$ 3,202$
Construction in progress 212 142 212 142
Buildings and improvements 22,090 21,647 1,405 1,405 23,495 23,052
Improvements other than buildings 272 357 272 357
Improvements - golf course 5,824 5,824 5,824 5,824
Furniture, fixtures and equipment 6,959 6,999 678 780 7,637 7,779
Total assets 31,412 30,939 9,230 9,417 40,642 40,356
Less accumulated depreciation (14,175) (12,755) (3,050)(2,840)(17,225) (15,595)
Net assets 17,237$ 18,184$ 6,180$ 6,577$ 23,417$ 24,761$
Additional information on the Village's capital assets can be found in Note 7 on page 43 of this report.
Debt
Currently, the Village uses debt financing on an as-needed basis each year. At the end of the current fiscal
year, the Village had total long-term debt of $4.02 million, all of which is in business-type activities.
The last outstanding debt instrument in the General Fund was satisfied in 2010; therefore, there is no
long-term debt outstanding in the Village’s governmental activities. None of the Village’s long-term debt
comprises debt backed by the full faith and credit of the government.
Table 6
Village of North Palm Beach
Outstanding Debt
(In Thousands)
Governmental Business
Activities Activities Total
2011 2010 2011 2010 2011 2010
Loans payable 3,845$ 4,090$ 3,845$ 4,090$
Capital leases 173 235 173 235
Total $$4,018$ 4,325$ 4,018$ 4,325$
Additional information on the Village's debt can be found in Note 8 on page 45 of this report.
12
NEXT YEAR'S BUDGET AND ECONOMIC FACTORS
The Village’s Unassigned Fund Balance is viewed by the Administration as a measurement of Village
financial stability. Unassigned general fund balance increased to $10.68 million during the current 2011
fiscal year. The Village is now ready to address the economic challenges anticipated in the next few
years.
The economic outlook for the primary revenue source for Florida municipalities will be challenging, as
cities are facing state mandated reductions of property taxes. In an effort to provide tax relief and spur the
slumping housing market, the State legislature focused on property tax reform in the 2007 session. House
Bill 1B was enacted to limit the authority of local governments to levy ad valorem taxes for the FY 2008
budget year and beyond.
The economic downturn and decline in property values have significantly impacted Village revenues. To
address the impact of the legislation, continuing increases in the cost of employee compensation and
benefits, and the reduction of revenues, the Village will need to continue to prioritize essential services
and desired levels of service to allocate sufficient funding in future budget years.
CONTACTING THE VILLAGE'S FINANCIAL MANAGEMENT
This financial report is designed to provide our citizens, taxpayers, customers, investors, and creditors
with a general overview of the Village's finances and to show the Village's accountability for the money it
receives. If you have questions about this report or need additional financial information, contact the
Village's Finance Department, at the Village of North Palm Beach, 501 U.S. Highway 1, North Palm
Beach, Florida 33408.
BASIC FINANCIAL STATEMENTS
Statement of Net Assets
September 30, 2011
Governmental Business-type
Activities Activities Total
Assets
Cash and cash equivalents 5,179,720$ 749,286$ 5,929,006$
Investments 8,451,395 8,451,395
Accounts receivable 356,486 31,562 388,048
Developer fee receivable 175,000 175,000
Inventories 41,660 67,221 108,881
Prepaids 235,264 41,461 276,725
Due from other governments 225,644 225,644
Restricted assets:
Cash and cash equivalents 548,489 548,489
Net pension assets 584,560 584,560
Intangible assets, net of amortization 39,042 39,042
Capital assets:
Nondepreciable 2,362,714 1,051,311 3,414,025
Depreciable (net of depreciation)14,874,641 5,128,587 20,003,228
Total assets 33,035,573 7,108,470 40,144,043
Liabilities
Accounts payable 444,016 119,990 564,006
Accrued liabilities 571,428 571,428
Deposits 5,250 5,250
Unearned revenue 483,866 334,746 818,612
Noncurrent liabilities:
Due within one year 836,443 314,930 1,151,373
Due in more than one year 1,138,355 3,747,004 4,885,359
Total liabilities 3,474,108 4,521,920 7,996,028
Net Assets
Invested in capital assets, net of related debt 17,237,355 2,200,928 19,438,283
Restricted for:
Recreation 413,500 413,500
Public safety 50,009 50,009
Streets and roads 49,329 49,329
Library 23,406 23,406
Other purposes 12,245 12,245
Unrestricted 11,775,621 385,622 12,161,243
Total net assets 29,561,465$ 2,586,550$ 32,148,015$
See notes to the financial statements.
THE VILLAGE OF NORTH PALM BEACH, FLORIDA
13
THE VILLAGE OF NORTH PALM BEACH, FLORIDA
Statement of Activities
For the Year Ended September 30, 2011
Charges for
Functions/Programs Expenses Activities
Government:
Governmental activities
General government 2,403,681$ 130,886$
Public safety 7,232,748 420,653
Public works 4,733,913 400,662
Community development and planning 811,177 861,394
Leisure services 2,749,065 1,043,459
Total governmental activities 17,930,584 2,857,054
Business-type activities - country club 3,691,528 3,571,199
Total business-type activities 3,691,528 3,571,199
Total government 21,622,112$ 6,428,253$
14
Program Revenues Net Expense (Revenue) and
Operating Capital Changes in Net Assets
Grants and Grants and Governmental Business-type
Contributions Contributions Activities Activities Total
6,466$ $ (2,266,329)$ $ (2,266,329)$
33,570 5,169 (6,773,356) (6,773,356)
69,938 (4,263,313) (4,263,313)
50,217 50,217
16,594 (1,689,012) (1,689,012)
126,568 5,169 (14,941,793)(14,941,793)
(120,329)(120,329)
(120,329)(120,329)
126,568$ 5,169$ (14,941,793) (120,329) (15,062,122)
General Revenues:
Taxes:
Property taxes 10,441,869 10,441,869
Local option gas taxes 259,794 259,794
Utility service taxes 2,198,148 2,198,148
Franchise taxes 1,191,155 1,191,155
Sales and use taxes 1,140,744 1,140,744
Investment income 97,743 8,493 106,236
Miscellaneous 30,622 30,622
Total general revenues 15,360,075 8,493 15,368,568
Change in net assets 418,282 (111,836) 306,446
Net assets, beginning of year 29,143,183 2,698,386 31,841,569
Net assets, end of year 29,561,465$ 2,586,550$ 32,148,015$
See notes to the financial statements.
15
THE VILLAGE OF NORTH PALM BEACH, FLORIDA
Balance Sheet
Governmental Funds
September 30, 2011
Capital Nonmajor Total
Projects Governmental Governmental
General Fund Funds Funds
Assets
Cash and cash equivalents 3,254,861$ 1,833,724$ 91,135$ 5,179,720$
Investments 8,451,395 8,451,395
Accounts receivable 356,486 356,486
Developer fee receivable 175,000 175,000
Inventories 41,660 41,660
Prepaids 235,264 235,264
Due from other funds 44,028 44,028
Due from other governments 172,804 52,840 225,644
Restricted cash and cash equivalents 548,489 548,489
Total assets 13,235,959$ 1,877,752$ 143,975$ 15,257,686$
Liabilities and fund balances
Liabilities
Accounts payable 304,998$ 86,178$ 52,840$ 444,016$
Accrued liabilities 571,428 571,428
Due to other funds 44,028 44,028
Deferred revenue 658,866 658,866
Total liabilities 1,535,292 86,178 96,868 1,718,338
Fund balances
Nonspendable:
Inventories and prepaids 276,924 276,924
Restricted for:
Recreation 413,500 413,500
Streets and roads 50,009 50,009
Public safety 49,329 49,329
Library 23,406 23,406
Other purposes 12,245 12,245
Assigned for:
Small business grants 95,000 95,000
Subsquent year's expenditures 91,594 91,594
Special revenue funds 47,107 47,107
Capital project funds 1,791,574 1,791,574
Unassigned 10,688,660 10,688,660
Total fund balances 11,700,667 1,791,574 47,107 13,539,348
Total liabilities and fund balances 13,235,959$ 1,877,752$ 143,975$ 15,257,686$
See notes to the financial statements.
16
THE VILLAGE OF NORTH PALM BEACH, FLORIDA
Reconciliation of the Balance Sheet – Governmental Funds
to the Statement of Net Assets
Governmental Funds
September 30, 2011
Fund balances - total governmental funds 13,539,348$
Amounts reported for governmental activities in the statement of net
assets are different because:
Capital assets used in governmental activities are not financial
resources and therefore are not reported in the governmental funds:
Governmental capital assets 31,412,880$
Less: accumulated depreciation (14,175,525)
17,237,355
Revenue is recognized when earned in the government-wide
statements, regardless of activity. Governmental funds report
based on modified accrual, i.e., both measurable and available:
Developer fee 175,000
Net pension assets related to defined benefit pension plans are not
available to pay for current-period expenditures and, therefore, are not
reported as assets in the governmental funds:584,560
Claims and settlements (18,463)
Other postemployement benefits (761,417)
Accrued compensated absences (1,194,918)
(1,974,798)
Net assets of governmental activities 29,561,465$
See notes to the financial statements.
Long-term liabilities, including notes and bonds payable, are not due and
payable in the current period and therefore are not reported in the
governmental funds. Long term liabilities at year-end consist of:
17
THE VILLAGE OF NORTH PALM BEACH, FLORIDA
Statement of Revenues, Expenditures, and Changes in Fund Balances
Governmental Funds
For the Year Ended September 30, 2011
Capital Nonmajor Total
Projects Governmental Governmental
General Fund Funds Funds
Revenues
Taxes 14,090,966$ $ $ 14,090,966$
Licenses and permits 959,098 959,098
Intergovernmental 1,287,638 269,739 1,557,377
Charges for services 1,934,424 1,934,424
Fines and forfeitures 164,366 164,366
Investment 97,743 97,743
Miscellaneous 59,462 59,462
Total revenues 18,593,697 269,739 18,863,436
Expenditures
Current
General government 2,402,241 2,402,241
Public safety 6,788,712 264,570 7,053,282
Public works 4,044,642 4,044,642
Community development and planning 790,937 790,937
Leisure services - recreation 2,295,959 2,295,959
Capital outlay 288,514 388,102 5,441 682,057
Total expenditures 16,611,005 388,102 270,011 17,269,118
Excess (deficiency) of revenues
over (under) expenditures 1,982,692 (388,102) (272) 1,594,318
Other financing sources (uses)
Transfers in 1,334,934 1,334,934
Transfers out (1,334,934) (1,334,934)
Total other financing sources (uses)(1,334,934) 1,334,934
Net change in fund balances 647,758 946,832 (272) 1,594,318
Fund balances
Beginning of year 11,052,909 844,742 47,379 11,945,030
End of year 11,700,667$ 1,791,574$ 47,107$ 13,539,348$
See notes to the financial statements.
18
THE VILLAGE OF NORTH PALM BEACH, FLORIDA
Reconciliation of the Statement of Revenues, Expenditures, and Changes in Fund
Balances of the Governmental Funds to the Statement of Activities
For the Year Ended September 30, 2011
Net change in fund balances - total governmental funds 1,594,318$
Amounts reported for governmental activities in the statement of
activities are different because:
Governmental funds report capital outlays as expenditures.
However, in the statement of activities, the cost of capital
assets is allocated over their estimated useful lives and reported
as depreciation expense:
Expenditures for capital assets 676,616$
Less: current year depreciation (1,623,233)
(946,617)
Gains and losses on disposal of capital assets are reported in the statement
of activities, whereas in the governmental funds the proceeds from the sale
increases financial resources. The difference is the net book value of the
assets retired:
Net book value for retired assets (536)
Governmental funds report revenues when earned and
available. However, in the Statement of Activities, revenues are
recognized when earned, regardless of availability:
Developer fee (250,000)
Expenses that do not use current financial resources are not
reported on the governmental funds but are included in the
statement of activities:
Change in long-term compensated absences (12,694)
Change in net pension asset of defined benefit pension plans 152,561
Change in other postemployement benefits (243,125)
Change in insurance liability 124,375
21,117
Change in net assets 418,282$
See notes to the financial statements.
19
THE VILLAGE OF NORTH PALM BEACH, FLORIDA
Statement of Net Assets
Proprietary Fund
September 30, 2011
Enterprise
Assets
Current assets
Cash and cash equivalents 749,286$
Accounts receivable 31,562
Inventories 67,221
Prepaids 41,461
Total current assets 889,530
Non-current assets
Intangible asset, net 39,042
Land, buildings, and equipment, net 6,179,898
Total non-current assets 6,218,940
Total assets 7,108,470
Liabilities
Current liabilities
Accounts payable 119,990
Deposits 5,250
Deferred revenue 334,746
Compensated absences - current portion 11,539
Capital leases - current portion 66,150
Loans payable - current portion 237,241
Total current liabilities 774,916
Non-current liabilities
Other postemployement benefits 28,434
Compensated absences 3,949
Capital leases 106,934
Loans payable 3,607,687
Total non-current liabilities 3,747,004
Total liabilities 4,521,920
Net Assets
Invested in capital assets, net of related debt 2,200,928
Unrestricted 385,622
Total net assets 2,586,550$
See notes to the financial statements.
20
THE VILLAGE OF NORTH PALM BEACH, FLORIDA
Statement of Revenues, Expenses, and Changes in Fund Net Assets
Proprietary Fund
For the Year Ended September 30, 2011
Enterprise
Operating revenue
Greens fee/cart rentals/membership fees 2,372,337$
Golf shop revenues 283,927
Driving range revenues 208,865
Restaurant revenues 700,378
Miscellaneous 5,692
Total operating revenues 3,571,199
Operating expenses
Golf course maintenance expenses 1,232,462
Clubhouse grounds expenses 84,485
Golf shop expenses 748,336
Food and beverage expenses 838,519
Administrative and general 104,659
Insurance 40,840
Depreciation and amortization 457,747
Total operating expenses 3,507,048
Operating income 64,151
Nonoperating revenues (expenses)
Interest revenue 8,493
Interest expense (180,125)
Gain on disposal of capital assets (4,355)
Total nonoperating revenues (expenses)(175,987)
Change in net assets (111,836)
Net assets - beginning 2,698,386
Net assets - ending 2,586,550$
See notes to the financial statements.
21
THE VILLAGE OF NORTH PALM BEACH, FLORIDA
Statement of Cash Flows
Proprietary Fund
For the Year Ended September 30, 2011
Enterprise
Cash flows from operating activities:
Receipts from customers 3,492,556$
Payments to suppliers for goods or services (2,326,886)
Payments to employees for services (711,171)
Net cash provided by operating activities 454,499
Cash flows from capital and related financing activities:
Principal paid on long term debt (307,448)
Interest paid on debt (180,723)
Acquisition of capital assets (60,457)
Net cash provided (used) by capital and related financing activities (548,628)
Cash flows from investing activities:
Interest and dividends on investments 8,493
Net increase (decrease) in cash and cash equivalents (85,636)
Cash and cash equivalents at beginning of year 834,922
Cash and cash equivalents at end of year 749,286$
Reconciliation of operating income
to net cash provided by operating activities:
Operating income 64,151$
Adjustments to reconcile operating income
to net cash provided by operating activities:
Depreciation 457,747
Other revenues
Change in assets and liabilities
Decrease in accounts receivable 5,359
(Increase) in inventory (6,947)
Decrease in prepaids (29,700)
Increase in accounts payable 36,176
Increase in deposits 1,717
Increase in compensated absences payable 9,079
(Decrease) in deferred revenue (85,719)
Increase in other postemployment benefits 2,636
Total adjustments 390,348
Net cash provided by operating activities 454,499$
See notes to the financial statements.
22
THE VILLAGE OF NORTH PALM BEACH, FLORIDA
Statement of Fiduciary Net Assets
Fiduciary Funds
September 30, 2011
Employee
Retirement Agency
Funds Funds
Assets
Cash and cash equivalents 1,314,241$ 346,499$
Investments:
Common equity securities 4,980,195
U.S. Government agencies 1,067,419
Municipal bonds 146,431
Corporate bonds 2,459,279
U.S. Treasury bonds 326,235
Equity mutual funds 4,076,260
Fixed income mutual funds 2,589,419
Accrued interest and dividends 49,550
Accounts receivable 103,936
Prepaids 216,394
Total assets 17,329,359 346,499
Liabilities
Accounts payable 41,412
Due to others 346,499
Total liabilities 41,412 346,499
Net Assets
Held in trust for pension benefits
and other purposes 17,287,947$ $
See notes to the financial statements.
23
THE VILLAGE OF NORTH PALM BEACH, FLORIDA
Statement of Changes in Fiduciary Net Assets
Fiduciary Funds
For the Year Ended September 30, 2011
Employee
Retirement
Funds
Additions
Contributions
Employer 1,293,732$
Plan members 268,604
State on-behalf payments 264,570
Total contributions 1,826,906
Investment earnings
Dividends and interest 325,300
Net increase in fair value
of investments (542,086)
Total investment losses (216,786)
Less: investment expenses 116,377
Total net investment losses (333,163)
Total additions 1,493,743
Deductions
Administrative expense 104,677
Benefits 1,078,699
Refund of contributions 36,256
Total deductions 1,219,632
Change in net assets 274,111
Net assets - beginning 17,013,836
Net assets - ending 17,287,947$
See notes to the financial statements.
24
THE VILLAGE OF NORTH PALM BEACH, FLORIDA
Notes to the Basic Financial Statements
September 30, 2011
25
NOTE 1 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
A. Reporting Entity
The Village of North Palm Beach, Florida (“the Village”) was incorporated in 1956 pursuant to
Chapter 31481, Laws of Florida, Extraordinary Session 1956. The Village is located in the
northeast portion of Palm Beach County, Florida. Its municipal area comprises approximately
1,900 acres of land and 1,200 acres of lakes, canals and lagoons. The Village’s nonseasonal
population consists of approximately 13,000 residents, which increases during the winter months
to approximately 18,000 people. The Village operates under the Council-Manager form of
government and provides the following services to its residents: public safety, planning and
zoning, sanitation, library, parks, marinas, and a country club. The Village Council (the
“Council”) is responsible for legislative and fiscal control of the Village.
In accordance with Statement 14 of the Government Accounting Standards Board, the
underlying concept of the governmental financial reporting entity is that governmental
organizations are responsible to elected governing officials; therefore, financial reporting should
report the elected officials' accountability for those organizations. Furthermore, the financial
statements of the reporting entity should allow users to distinguish between the primary
government and its component units, if any, by communicating information about the component
units and their relationships with the primary government. A component unit is a legally
separate organization for which the elected officials of the primary government are financially
accountable. Determining factors of financial accountability includes appointment of a voting
majority, imposition of will, financial benefit or burden on a primary government, or fiscal
dependency. In addition, component units can be other organizations for which the nature and
significance of their relationship with a primary government are such that exclusion would cause
the reporting entity's financial statements to be misleading or incomplete.
Based on the application of these criteria, management has determined that no component units
exist which would require inclusion in this report. Further, the Village is not aware of any entity
that would consider the Village to be a component unit.
B. Government-wide and Fund Financial Statements
The government-wide financial statements (i.e., the statement of net assets and the statement of
activities) report information on all of the non-fiduciary activities of the Village. For the most
part, the effect of interfund activities has been removed from these statements. Governmental
activities, which are normally supported by taxes and intergovernmental revenues, are reported
separately from business-type activities, which rely to a significant extent on fees and charges for
support.
THE VILLAGE OF NORTH PALM BEACH, FLORIDA
Notes to the Basic Financial Statements
September 30, 2011
26
NOTE 1 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued)
B. Government-wide and Fund Financial Statements (Continued)
The statement of activities demonstrates the degree to which the direct expenses of a given
function or segment are offset by program revenues. Direct expenses are those that are clearly
identifiable with a specific function or segment. Program revenues include 1) charges to
customers or applicants who purchase, use, or directly benefit from goods, services, or privileges
provided by a given function or segment, and 2) grants and contributions that are restricted to
meeting the operational or capital requirements of a particular function or segment. Taxes and
other items not properly included among program revenues are reported instead as general
revenues.
Separate financial statements are provided for governmental funds, proprietary funds, and
fiduciary funds, even though the latter are excluded from the government-wide financial
statements. Major individual governmental funds and the major individual enterprise fund are
reported as separate columns in the fund financial statements.
C. Measurement Focus, Basis of Accounting and Financial Statement Presentation
The government-wide financial statements and proprietary fund financial statements are reported
using the accrual basis of accounting and the economic resources measurement focus. Fiduciary
funds use the accrual basis of accounting and, except for agency funds, the economic resources
measurement focus. Agency funds do not have a measurement focus. Revenues are recorded
when earned and expenses are recorded when a liability is incurred, regardless of the timing of
related cash flows. Property taxes are recognized as revenues in the year for which they are
levied. Grants and similar items are recognized as revenue as soon as all eligibility requirements
imposed by the provider have been met.
Governmental fund financial statements are reported using the current financial resources
measurement focus and the modified accrual basis of accounting. Revenues are recognized as
soon as they are both measurable and available. Revenues are considered to be available when
they are collectible within the current period or soon enough thereafter to pay liabilities of the
current period. For this purpose, the Village considers revenues to be available when they are
collectible within the current period or soon enough thereafter to pay liabilities of the current
period. For this purpose, the Village considers revenues to be available if they are collected
within 60 days of the end of the current fiscal period. Expenditures generally are recorded when
a liability is incurred, as under accrual accounting. However, debt service expenditures, as well
as expenditures related to compensated absences and claims and judgments, are recorded only
when payment is due.
Property taxes, sales taxes, franchise taxes, licenses, intergovernmental revenue, investment
income, and charges for services are all considered to be susceptible to accrual and so have been
recognized as revenue of the current fiscal period. All other revenues are considered to be
measurable and available only when received in cash by the Village.
THE VILLAGE OF NORTH PALM BEACH, FLORIDA
Notes to the Basic Financial Statements
September 30, 2011
27
NOTE 1 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued)
C. Measurement Focus, Basis of Accounting and Financial Statement Presentation (Continued)
The Village reports the following major governmental funds:
General Fund
The general fund is the primary operating fund and is used to account for all financial resources
applicable to the general operations of the Village except those required to be accounted for in
another fund.
Capital Projects Fund
The capital projects fund is used to account for the cost of acquiring, constructing, and placing
into service those capital improvements which are associated with activities in the General Fund.
The Village reports the following major (and only) proprietary fund:
Country Club Enterprise Fund
The fund accounts for the activities related to the Country Club.
Additionally, the Village reports the following fund types:
Special Revenue Funds
The Village has four special revenue funds to account for the proceeds of specific revenue
sources that are legally restricted to expenditures for specific sources. The funds are the Public
Safety Fund, Northlake Boulevard Fund, Recreation, and On-Behalf Pension Contributions.
Employee Retirement Funds
The pension trust funds account for the activities of the General Employees Retirement Fund, the
Fire and Police Officers Retirement Fund and the Volunteer Firemen’s Length of Service Award
Pension Fund, which accumulate resources for pension benefits to qualified employees.
THE VILLAGE OF NORTH PALM BEACH, FLORIDA
Notes to the Basic Financial Statements
September 30, 2011
28
NOTE 1 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued)
C. Measurement Focus, Basis of Accounting and Financial Statement Presentation (Continued)
Agency Funds
The Agency Funds account for assets that are held for other parties and cannot be used to finance
the Village’s own programs. The two agency funds are the Northlake Boulevard Task Force,
which is for the streetscape improvement of Northlake Boulevard, and the Manatee Protection
Fund, in which the assets are held in trust for the protection of manatees through the enforcement
of boat speed zones on the intracoastal and inland waterways.
Private sector standards of accounting and financial reporting issued prior to December 1, 1989,
generally are followed in both the government-wide and proprietary fund financial statements to
the extent that those standards do not conflict with or contradict guidance of GASB.
Governments also have the option of following subsequent private sector guidance for their
business-type activities and enterprise funds, subject to this same limitation. The Village has
elected not to follow subsequent private sector guidance.
As a general rule, the effect of interfund activity has been eliminated from the government-wide
financial statements. Exceptions to this general rule are charges between the government’s
country club and various other functions of the Village. Elimination of these charges would
distort the direct costs and program revenues reported for the various functions concerned.
Proprietary funds distinguish operating revenues and expenses from non-operating items.
Operating revenues and expenses generally result from providing services and producing and
delivering goods in connection with a proprietary fund’s principal ongoing operations. The
principal operating revenues of the Village’s Country Club Enterprise Fund are charges to
customers for sales and services. Operating expenses for the Enterprise Fund include the cost of
sales and services, administrative expenses and depreciation on capital assets. All revenues and
expenses not meeting this definition are reported as non-operating revenues and expenses.
When both restricted and unrestricted resources are available for use, it is the Village’s policy to
use restricted resources first, then unrestricted resources as they are needed.
D. Assets, Liabilities, and Net Assets or Equity
Cash and Cash Equivalents
All short-term investments that are highly liquid are considered to be cash equivalents. Cash
equivalents are readily convertible to a known amount of cash, and at the day of purchase, have a
maturity date no longer than three months.
THE VILLAGE OF NORTH PALM BEACH, FLORIDA
Notes to the Basic Financial Statements
September 30, 2011
29
NOTE 1 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued)
D. Assets, Liabilities, and Net Assets or Equity (Continued)
Accounts Receivable
Accounts receivable of the General Fund consists of billed and unbilled receivables.
Concentration of Credit Risk
The Village performs ongoing credit evaluations of its customers and does not require collateral.
The Village maintains an allowance for uncollectible accounts at a level which management
believes is sufficient to cover potential credit losses.
Investments
Investments are reported at fair value, which is determined by using various third-party pricing
sources. The Local Government Surplus Funds Trust Fund, administered by the Florida State
Board of Administration, is a “2a-7 like” pool and these investments are valued using the pooled
share price.
Interfund Transactions
Activity between funds that is representative of lending/borrowing arrangements outstanding at
the end of the fiscal year are referred to as either “due to” or “due from other funds”. Any
residual balance outstanding between the governmental activities and business-type activities are
reported in the government-wide financial statements as internal balances.
Transfers and interfund balances totally within governmental activities and those that are totally
within business-type activities are eliminated and not presented in the government wide financial
statements. Transfers and balances between governmental and business-type activities are
presented in the government-wide financial statements.
Inventories and prepaid items
Inventories are valued at cost determined on a last-in, first-out basis (LIFO). Inventories in the
General Fund consist of expendable supplies held for consumption. Inventories in the Enterprise
Fund consist of goods for sale to the public. The initial cost is recorded as an asset at the time
the individual inventory items are purchased and are charged against operations in the period
when used.
Certain payments to vendors reflect costs applicable to future accounting periods and are
recorded as prepaid items in both government-wide and fund financial statements.
THE VILLAGE OF NORTH PALM BEACH, FLORIDA
Notes to the Basic Financial Statements
September 30, 2011
30
NOTE 1 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued)
D. Assets, Liabilities, and Net Assets or Equity (Continued)
Capital Assets and Depreciation
Capital assets, which include property, plant, infrastructure, and equipment, are reported in the
applicable governmental or business-type activities column in the government-wide financial
statements. The Village capitalizes all land purchases. The capitalization policy for other assets
are items with an estimated life in excess of one year and an initial individual cost of $250,000
for infrastructure, $25,000 for land improvements, $50,000 for buildings and building
improvements, and $5,000 for equipment and vehicles. The Village has elected to retroactively
apply the capitalization requirements of GASB Statement No. 34 to major general infrastructure
assets acquired in fiscal years ending after June 30, 1980, or that were significantly reconstructed
or improved during that multi-year period. Infrastructure is reported in buildings and
improvements.
The accounting and reporting treatment applied to the capital assets associated with a fund are
determined by its measurement focus. General capital assets are assets of the Village as a whole.
When purchased, such assets are recorded as expenditures in the governmental funds and
capitalized as assets in the government-wide statement of net assets. General capital assets are
carried at historical cost. Where cost cannot be determined from the available records, estimated
historical cost has been used to record the estimated value of the assets. Assets acquired by gifts
or bequests are recorded at their fair value at the date of acquisition.
Capital assets of the Enterprise Fund are capitalized in the fund. The valuation basis for
Enterprise Fund capital assets is the same as those used for General capital assets. Additionally,
net interest cost is capitalized on Enterprise Fund projects during the construction period.
Additions, improvements, and other capital outlay that significantly extend the useful life of an
asset are capitalized. Other costs incurred for repairs and maintenance are expensed as incurred.
Depreciation has been provided over the estimated useful lives using the straight-line method of
depreciation. The estimated lives for each major class of depreciable capital assets are as
follows:
Buildings, improvements and infrastructure 5-30 years
Golf course improvements 5-30 years
Machinery and Equipment 3-15 years
Vehicles 3-20 years
THE VILLAGE OF NORTH PALM BEACH, FLORIDA
Notes to the Basic Financial Statements
September 30, 2011
31
NOTE 1 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued)
D. Assets, Liabilities, and Net Assets or Equity (Continued)
Deferred Revenue
The government reports deferred revenue on its government wide statement of net assets,
proprietary statement of net assets, and governmental funds balance sheet. Deferred revenues
arise when potential revenue does not meet both the "measurable" and "available" criteria for
recognition in the current period. Deferred revenues also arise when the government receives
resources before it has a legal claim to them, as when grant monies are received prior to
incurring qualifying expenditures. In subsequent periods, when both revenue recognition criteria
are met, or when the government has a legal claim to the resources, the liability for deferred
revenue is removed and revenue is recognized.
Compensated Absences
The Village’s employees are granted compensated absence pay for vacation and sick leave in
varying amounts based on length of service. Unused compensated absences are payable upon
separation from service. Vacation is accrued as a liability when the employee earns benefits.
This means that the employee has rendered services that give rise to a vacation liability and it is
probable that the Village will compensate the employee in some manner, e.g., in cash or paid
time-off, now or upon termination or retirement. The Village uses the vesting method in
accruing sick leave liability. Under the vesting method, the liability for sick leave is accrued for
employees who are eligible to receive termination payments upon separation.
Compensated absences are accrued when incurred in the government-wide and proprietary
financial statements. A liability for these amounts is reported in the governmental funds only if
they have matured, for example, as a result of employee resignations or retirements. For the
governmental funds, compensated absences are liquidated by the General Fund.
Long-Term Obligations
In the government-wide financial statements, and proprietary fund types in the fund financial
statements, long-term debt and other long-term obligations are reported as liabilities in the
applicable governmental activities, business-type activities, or proprietary fund type statement of
net assets. Bond premiums and discounts, as well as issuance costs, are deferred and amortized
over the life of the bonds using the effective interest method. Bonds payable are reported net of
the applicable bond premium or discount. Bond issuance costs are reported as deferred charges
and amortized over the term of the related debt.
THE VILLAGE OF NORTH PALM BEACH, FLORIDA
Notes to the Basic Financial Statements
September 30, 2011
32
NOTE 1 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued)
D. Assets, Liabilities, and Net Assets or Equity (Continued)
Long-Term Obligations (Continued)
In the fund financial statements, governmental fund types recognize bond premiums and
discounts, as well as bond issuance costs, during the current period. The face amount of debt
issued is reported as other financing sources. Premiums received on debt issuances are reported
as other financing sources, while discounts on debt issuances are reported as other financing
uses. Issuance costs, whether or not withheld from the actual debt proceeds received, are
reported as debt service expenditures.
Net Assets
Equity in the government-wide statement of net assets and the proprietary fund is displayed in
three categories: 1) invested in capital assets net of related debt, 2) restricted, and 3) unrestricted.
Net assets invested in capital assets net of related debt consists of capital assets reduced by
accumulated depreciation and by any outstanding debt incurred to acquire, construct, or improve
those assets. Net assets are reported as restricted when there are legal limitations imposed on
their use by Village legislation or external restrictions by other governments, creditors, or
grantors. Unrestricted net assets consist of all net assets that do not meet the definition of either
of the other three components.
Fund Equity
Fund balance is the difference between assets and liabilities reported in governmental funds. There
are five possible components of fund balance:
· Nonspendable fund balance represents amounts that are not in spendable form or are
legally or contractually required to be maintained intact.
· Restricted fund balance represents amounts that can be spent only for specific purposes
stipulated by external providers (e.g. creditors, grantors, contributor, or laws or regulations
of other governments) or imposed by law through constitutional provisions or enabling
legislation.
· Committed fund balance represents amounts that can be used only for the specific purposes
determined by formal action of the Village Commission. The Village has no committed
funds.
· Assigned fund balance includes spendable fund balance amounts that are intended to be
used for specific purposes, as expressed by the Village Commission or Village Manager,
that are neither considered restricted or committed. The Small Business Grants is a
program the Village Council approved in the prior fiscal year to provide matching grants
of up to $5,000 for improvements to small business properties.
· Unassigned fund balance is the residual fund balance classification for the general fund.
THE VILLAGE OF NORTH PALM BEACH, FLORIDA
Notes to the Basic Financial Statements
September 30, 2011
33
NOTE 1 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued)
D. Assets, Liabilities, and Net Assets or Equity (Continued)
Fund Equity (Continued)
The Village will first use committed fund balance then assigned fund balance and then
unassigned fund balance when expenditures are incurred for purposes for which any of the
unrestricted fund balance classifications could be used.
Use of Estimates
The financial statements and related disclosures are prepared in conformity with accounting
principles generally accepted in the United States. Management is required to make estimates
and assumptions that affect the reported amounts of assets and liabilities, the disclosure of
contingent assets and liabilities at the date of the financial statements, and revenue and expenses
during the period reported. These estimates include the collectibility of accounts receivable, the
use and recoverability of inventory, the useful lives and impairment of tangible assets, and the
realization of net pension assets, among others. Estimates and assumptions are reviewed
periodically and the effects of revisions are reflected in the financial statements in the period
they are determined to be necessary. Actual results could differ from those estimates.
Statement of Cash Flows
For purposes of the statement of cash flows, the Village considers all short-term investments that
are highly liquid to be cash equivalents. Cash equivalents are readily convertible to a known
amount of cash, and at the day of purchase, have a maturity date no longer than three months.
NOTE 2 - STEWARDSHIP, COMPLIANCE, AND ACCOUNTABILITY
A. Budgetary Data
Formal budgetary integration is employed as a management control device during the year for
the General Fund and the Enterprise Fund. The only governmental fund with a legally adopted
annual budget is the General Fund. This budget is adopted on a basis consistent with generally
accepted accounting principles. Except for budgeting capital expenditures and not budgeting for
depreciation, the annual appropriated budgets for the Enterprise Funds are adopted on a basis
consistent with generally accepted accounting principles. For budgeting purposes, current year
encumbrances are not treated as expenditures.
The procedures for establishing budgetary data are as follows:
· In July of each year, the Village Manager submits a proposed operating budget to the
Council for the next fiscal year commencing the following October 1st. The proposed
budget includes expenditures and the means of financing them.
· During the third week of July, the Council holds public meetings to obtain taxpayer
comments.
THE VILLAGE OF NORTH PALM BEACH, FLORIDA
Notes to the Basic Financial Statements
September 30, 2011
34
NOTE 2 - STEWARDSHIP, COMPLIANCE, AND ACCOUNTABILITY (Continued)
A. Budgetary Data (Continued)
· Upon completion of the public hearings and prior to October 1, a final operating budget
is legally enacted through the passage of an ordinance. Estimated beginning fund
balances are considered in the budgetary process.
· The Village Manager is authorized to transfer budgeted amounts up to $10,000 within a
department. Any change to the total departmental expenses must be approved by the
Village Council.
· Appropriations along with encumbrances lapse on September 30th.
Budgeted amounts are as originally adopted, or as amended by appropriate action. During the
year, several supplementary appropriations were necessary.
Encumbrance accounting is employed in governmental funds. Encumbrances (e.g. purchase
orders, contracts) outstanding at year end are reported as reservations of fund balances and do
not constitute expenditures or liabilities because the commitments will be reappropriated and
honored during the subsequent year.
B. Property Taxes
Under Florida law, the assessment of all properties and the collection of all county, municipal
and school board property taxes are consolidated in the offices of the County Property Appraiser
and the County Tax Collector. All property is reassessed according to its fair market value on
January 1 of each year and each assessment roll is submitted to the State Department of Revenue
for review to determine if the assessment rolls meet all of the appropriate requirements of State
law. The laws of the State regulating tax assessment are also designed to assure a consistent
property valuation method statewide. State Statutes permit municipalities to levy property taxes
at a rate of up to 10 mills.
The tax levy of the Village is established by the Council prior to October 1 of each year during
the budget process. The Palm Beach County Property Appraiser incorporates the Village’s
millage into the total tax levy, which includes the County, County School Board, and special
district tax requirements. The millage rate assessed by the Village for the year ended
September 30, 2011, was 6.9723 ($6.9723 for each $1,000 of assessed valuation).
Taxes may be paid less a 4% discount in November or at declining discounts each month through
the month of February. All unpaid taxes become delinquent on April 1 following the year in
which they are assessed. Delinquent taxes on real property bear interest at 18% per year. On or
prior to June 1 following the tax year, certificates are offered for sale for all delinquent taxes on
real property.
THE VILLAGE OF NORTH PALM BEACH, FLORIDA
Notes to the Basic Financial Statements
September 30, 2011
35
NOTE 2 - STEWARDSHIP, COMPLIANCE, AND ACCOUNTABILITY (Continued)
B. Property Taxes (Continued)
After sale, tax certificates bear interest at 18% per year or at any lower rate bid by the buyer.
The certificate holder may make application for a tax deed on any unredeemed tax certificate
after a period of two years. The County holds unsold certificates. Delinquent taxes on personal
property bear interest at 18% per year until the tax is satisfied either by seizure and sale of the
property or by the five-year statute of limitations. At September 30, 2011, unpaid delinquent
taxes are not material and have not been recorded by the Village.
NOTE 3 – DEPOSITS AND INVESTMENTS
Deposits
As of September 30, 2011, the carrying amount of the Village’s deposits (including fiduciary
funds) was $5,370,647, and the bank balances totaled $5,714,923. In addition to insurance
provided by the Federal Depository Insurance Corporation, deposits are held in banking
institutions approved by the State Treasurer of the State of Florida to hold public funds. Under
Florida Statutes Chapter 280, Florida Security for Public Deposits Act, the State Treasurer
requires all Florida qualified public depositories to deposit with the Treasurer or other banking
institution eligible collateral. In the event of failure of a qualified public depository, the
remaining public depositories would be responsible for covering any resulting losses. The
Village’s deposits at year end are considered insured for custodial credit risk purposes.
The Village pools idle cash from all funds for the purpose of increasing income through
investment activities. Investment income from the pool is allocated back to the respective funds
based on each fund’s equity in the pool with the exception of the Capital Projects Fund and the
special revenue funds.
Investments
The State Board of Administration is part of the Local Governments Surplus Funds Trust Fund
and is governed by Chapter 19-7 of the Florida Administrative Code. These rules provide
guidance and establish the general operating procedures for the administration of the Local
Governments Surplus Funds Trust Fund. Additionally, the Office of the Auditor General
performs the operational audit of the activities and investments of the State Board of
Administration. The Local Government Surplus Funds Trust Fund is not a registrant with the
Securities and Exchange Commission (SEC); however, the board has adopted operating
procedures consistent with the requirements for a 2a-7 fund.
THE VILLAGE OF NORTH PALM BEACH, FLORIDA
Notes to the Basic Financial Statements
September 30, 2011
36
NOTE 3 – DEPOSITS AND INVESTMENTS (Continued)
Investments (Continued)
On December 4, 2007, based on recommendations from an outside financial advisor, the State
Board of Administration restructured the Pool into two separate pools. Pool A, (Local
Government Surplus Funds Trust Fund Investment Pool) consisted of all money market
appropriate assets. Pool B, (Surplus Funds Trust Fund) consisted of assets that either defaulted
on a payment, paid more slowly than expected, and/or had any significant credit and liquidity
risk. At the time of the restructuring, all current pool participants had their existing balances
proportionately allocated into Pool A and Pool B. On August 3, 2009, the SBA announced
“Florida PRIME” as the highly enhanced version of the SBA’s prior Local Government
Investment Pool.
At September 30, 2011, Florida PRIME was assigned a "AAA(m)" principal stability fund rating
by the Standard and Poor's Ratings. Florida PRIME is considered a SEC 2a7-like fund, thus, the
account balance should also be considered its fair value. Fund B is not considered a SEC 2a7-
like fund and is not rated by any nationally recognized rating agency.
Fund B is accounted for as a fluctuating NAV pool. The fair value factor for September 30,
2011, was 0.756839. The factor should be multiplied by the account balance in order to calculate
the fair value of the investment in Fund B.
The weighted average days to maturity (WAM) of Florida PRIME at September 30, 2011, was
38 days. A portfolio’s WAM reflects the average maturity in days based on final maturity or
reset date, in the case of floating rate instruments. WAM measures the sensitivity of Florida
PRIME to interest rate changes.
The weighted average life (WAL) of Fund B at September 30, 2011, was 4.82 years. A
portfolio’s WAL is the dollar weighted average length of time until securities held reach
maturity. WAL is based on legal final maturity dates for Fund B as of September 30, 2011.
However, because fund B consists of restricted or defaulted securities there is considerable
uncertainty regarding the weighted average life.
As of September 30, 2011, the Village had $532,353 invested in Florida PRIME. The cost basis
of Fund B as of September 30, 2011, was $254,145 and the fair value was $192,347. Additional
information regarding the Local Government Surplus Funds Trust Fund may be obtained from
the State Board of Administration.
THE VILLAGE OF NORTH PALM BEACH, FLORIDA
Notes to the Basic Financial Statements
September 30, 2011
37
NOTE 3 – DEPOSITS AND INVESTMENTS (Continued)
Investments (Continued)
As of September 30, 2011, the Village held the following investments:
S&P’s
Credit
Rating
Fair
Value
Weighted
Average
Maturity
Governmental Funds:
Wells Fargo municipal money
market fund N/R $ 1,150,824 N/A
State Board of Administration
Investment Fund B N/R 192,347 4.82 yrs. (WAL)
Florida Prime AAA(m) 532,353 38 days
Money Market Funds N/R 38,968 N/A
U.S. Government Supported
Corporate Debt AA+ 899,754 0.58 yrs.
U.S. Government and Agency
Obligations AA+ 2,560,911 1.93 yrs.
U.S. Treasury Notes AA+ 4,759,415 1.84 yrs.
Fiduciary Funds:
Money Market Funds N/R 1,078,661 N/A
GNMA, FNMA, FHLMC
Pools N/R 964,030 20.16 yrs.
U.S. Government Agencies AA+ 103,389 10.71 yrs.
Corporate Bonds AA+ to A- 2,459,279 7.62 yrs.
U.S. Treasury Obligations AA+ 326,235 29.38 yrs.
Municipal Bonds AAA to AA 146,431 22.72 yrs.
Common Equity Securities N/R 4,980,195 N/A
Equity Mutual Funds N/R 4,076,260 N/A
Fixed Income Mutual Funds N/R 2,589,419 N/A
Total investments $26,858,471
Investments are held in the governmental and fiduciary funds.
Interest rate risk – Interest rate risk is the risk that changes in interest rates will adversely affect
the fair value of an investment. Generally, the longer the time to maturity, the greater the
exposure to interest rate risks.
THE VILLAGE OF NORTH PALM BEACH, FLORIDA
Notes to the Basic Financial Statements
September 30, 2011
38
NOTE 3 – DEPOSITS AND INVESTMENTS (Continued)
Investments (Continued)
Interest rate risk (Continued)
The Village limits its exposure to fair value losses resulting from rising interest rates by
structuring the investment portfolio so that the securities mature to meet cash requirements for
ongoing operations, thereby avoiding the need to sell securities on the open market prior to
maturity; and investing operating funds primarily in short-term securities, money market mutual
funds, or similar investment pools unless it is anticipated that long-term securities can be held to
maturity without jeopardizing the liquidity requirements. The Retirement Funds do not have a
formal investment policy that limits investment maturities as a means of managing exposure to
fair value losses arising from increasing interest rates.
The Village’s investment in asset backed securities consist of mortgage pass-through securities
based on pools of residential home mortgage loans which are subject to prepayments and
therefore highly sensitive to changes in interest rates.
Custodial credit risk – For an investment, custodial credit risk is the risk that, in the event of the
failure of the counterparty, the Village will not be able to recover the value of its investments
that are in the possession of an outside party. At September 30, 2011, all investments were
insured or collateralized, except the Village’s three pension funds, in which the underlying
securities are held by counterparty, or by its trust department or agent but not in the Village’s
name and is uninsured and unregistered. However, all securities are registered in the funds’
names.
Concentrations of credit risk – Concentration of credit risk is defined as the risk of loss attributed
to the magnitude of an investment in a single user. The Village places no limit on the amount
they may invest in any one issuer, except those in the Fire and Police Retirement Fund. Not
more than five (5) percent of the Fund’s assets shall be invested in the common stock or capital
stock of any one issuing company.
Authorized Investments –The Village has adopted an investment policy that applies to all the
investment activity except the Employees’ Pension Funds, which are organized and administered
separately, as listed below, or for funds related to the issuance of debt where there are other
existing policies or indentures in effect for such funds. The Village is authorized to invest its
funds as follows:
1. Interest-bearing checking, savings and time deposits in banks from the most current top
ten listed “qualified public depositories”, as defined in Chapter 280, Florida Statutes;
with a CAEL (Capital Adequacy, Asset Quality, Earnings, Liquidity) score of 3 or better;
THE VILLAGE OF NORTH PALM BEACH, FLORIDA
Notes to the Basic Financial Statements
September 30, 2011
39
NOTE 3 – DEPOSITS AND INVESTMENTS (Continued)
Investments (Continued)
Authorized Investments (Continued)
2. Securities and Exchange Commission registered money/market mutual funds with the
highest credit quality rating from S&P and Moody’s rating agencies;
3. Insurance companies with a A.M. Best minimum rating of aaa;
4. Corporate interest notes with the highest credit quality rating from S&P and Moody’s
rating agencies;
5. The Local Government Surplus Funds Trust Fund or any intergovernmental investment
pool authorized pursuant to the Florida Interlocal Cooperation Act, as provided in
Chapter 163, Florida Statutes; provided all components in each pool must satisfy the
appropriate pre-qualification parameters noted for that institution;
6. Direct obligations of the United States Treasury;
7. Federal agencies and instrumentalities;
The Village General Employees’ Retirement Fund is authorized to invest its funds as follows:
1. Interest-bearing checking or savings accounts in qualified public depositories, as defined
in Chapter 280, Florida Statutes;
2. Interest-bearing time deposits in qualified public depositories, as defined in Chapter 280,
Florida Statutes;
3. The Local Government Surplus Funds Trust Fund or any intergovernmental investment
pool authorized pursuant to the Florida Interlocal Cooperation Act, as provided in
Chapter 163, Florida Statutes;
4. Securities and Exchange Commission registered money market funds with the highest
credit quality rating from a nationally recognized rating agency;
5. Direct obligations of the United States Treasury;
6. Federal agencies and instrumentalities;
THE VILLAGE OF NORTH PALM BEACH, FLORIDA
Notes to the Basic Financial Statements
September 30, 2011
40
NOTE 3 – DEPOSITS AND INVESTMENTS (Continued)
Investments (Continued)
Authorized Investments (Continued)
7. Securities of, or interest in, any open-end or closed-end management-type investment
company or investment trust registered under the Investment Company Act of 1940, 15
U.S.C. sections 80a-1 et seq., as amended from time to time, provided that the portfolio
of such investment company or investment trust is limited to obligations of the United
States Government or any agency or instrumentality thereof and to repurchase
agreements fully collateralized by such United States Government obligations, and
provided that such investment company or investment trust takes delivery of such
collateral either directly or through an authorized custodian;
8. Other investments authorized by law or by ordinance by the Village.
Investments of the Fire and Police Retirement Fund can consist of the following:
1. Time or savings accounts of a national bank, a state bank insured by the Federal Deposit
Insurance Corporation, or a savings, building and loan association insured by the Federal
Deposit Insurance Corporation;
2. Obligations of the United States or obligations guaranteed as to principal and interest by
Government of the United States;
3. Bonds, stocks, or any other evidence of indebtedness issued or guaranteed by a
corporation organized under the laws of the United States, any state or organized territory
of the United States, or the District of Columbia, provided:
a. The corporation is listed on any one (1) or more of the recognized national stock
exchanges and holds a rating in one of the three (3) highest classifications by a
major rating service; and
b. The Board shall not invest more than five (5) percent of its assets in the common
stock, capital stock, bonds or indebtedness of any one (1) issuing company, nor
shall the aggregate investment of in any one (1) issuing company exceed five (5)
percent of the outstanding capital stock of that company, nor shall the aggregate
of its investments in equities at cost exceed sixty (60) percent of the pension
funds’ assets;
4. Not withstanding any provision of this section to the contrary, the board is specifically
authorized to invest in foreign securities to the extent authorized by sections 175.071(1)
and 185.06(1)(b), Florida Statutes.
THE VILLAGE OF NORTH PALM BEACH, FLORIDA
Notes to the Basic Financial Statements
September 30, 2011
41
NOTE 3 – DEPOSITS AND INVESTMENTS (Continued)
Investments (Continued)
A reconciliation of deposit and investments as shown on the statement of net assets and
statement of fiduciary net assets for the Village is as follows:
By Category:
Deposits $ 5,370,647
Petty cash 5,750
Investments 26,858,471
Total deposits and investments $32,234,868
Presented in the statement of net assets
Governmental activities
Cash and cash equivalents $5,179,720
Restricted cash and cash equivalents 548,489
Investments 8,451,395
Business-type activities
Cash and cash equivalents 749,286
Total statements of net assets 14,928,890
Presented in the statement of fiduciary net assets
Pension trust funds
Cash and cash equivalents 1,314,241
Investments 15,645,238
Agency funds
Cash and cash equivalents 346,499
Total fiduciary funds 17,305,978
Total deposits and investments $32,234,868
THE VILLAGE OF NORTH PALM BEACH, FLORIDA
Notes to the Basic Financial Statements
September 30, 2011
42
NOTE 4 – RECEIVABLES
Receivables at September 30, 2011, were as follows:
General
Fund
Country
Club Total
Utility franchise fees & taxes $ 347,467 $ $ 347,467
Conroy Drive assessment 6,907 6,907
Other accounts receivable 2,112 31,562 33,674
Total accounts receivable $ 356,486 $ 31,562 $ 388,048
NOTE 5 – DEVELOPER FEE RECEIVABLE
The Village entered into an agreement with a developer on February 14, 2008, in which it agreed
to accept payment of $1,175,000 in lieu of the dedication of land for public use. The developer
paid $250,000 upon execution of the agreement. The balance due is to be paid in annual
installments of $250,000 on the anniversary date of the agreement until paid, with a final
payment of $175,000 in 2012. At September 30, 2011, the remaining amount receivable was
$175,000. In accordance with Village ordinance Sec. 36-23, amounts received shall be utilized
for parks and recreational purposes or the construction or expansion of any public facilities or
other improvements designed to mitigate the impacts of the subdivision.
NOTE 6 – INTANGIBLE ASSETS
The intangible asset consists of the right to the availability and use of reclaimed water resulting
from an agreement with Seacoast Utility Authority. The asset had an original value of $50,377
and is being amortized on a straight line basis over the period of the expected benefit of ten
years.
THE VILLAGE OF NORTH PALM BEACH, FLORIDA
Notes to the Basic Financial Statements
September 30, 2011
43
NOTE 7 – CAPITAL ASSETS
Capital Assets activity for the year ended September 30, 2011, was as follows:
Primary Government
Governmental Activities:
Beginning
Balance Additions Deletions
Transfers
Ending
Balance
Capital assets not being
depreciated:
Land $ 2,151,089 $ $
$
$ 2,151,089
Construction in progress 141,851 81,014 (11,240) 211,625
Capital assets being depreciated:
Buildings 9,305,950 (1,531) 9,304,419
Improvements 12,341,173 463,588 (18,933) 12,785,828
Machinery and equipment 3,362,249 52,099 (110,817) 3,303,531
Vehicles 3,637,653 91,155 (72,420) 3,656,388
Total at historical cost: 30,939,965 687,856 (214,941) 31,412,880
Less accumulated depreciation for:
Buildings (4,215,667) (293,394) 1,531 (4,507,530)
Improvements (3,577,830) (828,688) 18,933 (4,387,585)
Machinery and equipment (2,437,132) (235,690) 110,281 (2,562,541)
Vehicles (2,524,828) (265,461) 72,420 (2,717,869)
Total accumulated depreciation (12,755,457) (1,623,233) 203,165 (14,175,525)
Governmental activities capital
assets, net $ 18,184,508 $ (935,377) $ (11,776)
$
$ 17,237,355
Depreciation expense was charged to functions/programs of the primary government as follows:
Governmental activities:
General government $ 112,767
Public safety 382,506
Public works 670,980
Community development 14,463
Leisure services 442,517
Total depreciation expense, governmental activities $1,623,233
THE VILLAGE OF NORTH PALM BEACH, FLORIDA
Notes to the Basic Financial Statements
September 30, 2011
44
NOTE 7 – CAPITAL ASSETS (Continued)
Business-type activities:
Beginning
Balance Additions Deletions
Transfers
Ending
Balance
Capital assets not being depreciated:
Land $ 1,051,311 $ $ $ $ 1,051,311
Construction in progress
Capital assets being depreciated:
Buildings 1,405,035 1,405,035
Improvements 6,180,517 57,399 (141,986) 6,095,930
Machinery and equipment 471,978 3,058 (88,623) 386,413
Vehicles 307,705 (16,650) 291,055
Total at historical cost: 9,416,546 60,457 (247,259) 9,229,744
Less accumulated depreciation for:
Buildings (929,017) (28,325) (957,342)
Improvements (1,443,533) (329,475) 137,631 (1,635,377)
Machinery and equipment (388,163) (20,597) 88,623 (320,137)
Vehicles (79,328) (74,312) 16,650 (136,990)
Total accumulated depreciation (2,840,041) (452,709) 242,904 (3,049,846)
Business-type activities capital
assets, net $ 6,576,505 $ (392,252) $ (4,355)
$
$ 6,179,898
Construction Commitments
Contracts awarded but not yet completed were as follows:
Project Description
Estimated
Cost
Governmental activities:
Village-wide Sidewalk Improvements $ 62,463
SW Neighborhoods Sidewalks and Streetlights,
Engineering and Design
23,322
Building Department Software Upgrade 80,899
THE VILLAGE OF NORTH PALM BEACH, FLORIDA
Notes to the Basic Financial Statements
September 30, 2011
45
NOTE 8 – LONG TERM LIABILITIES
Change in Long-Term Liabilities
Long-term liability activity for the year ended September 30, 2011, was as follows:
Balance
October 1,
2010 Additions Reductions
Balance
September 30,
2011
Amount
Due
Within
One Year
Governmental activities
Claims and settlements $ 142,838 $ $ (124,375) $ 18,463 $
OPEB (see note 15) 518,292 243,125 761,417
Compensated absences
payable 1,182,224 867,486 (854,792) 1,194,918 836,443
Total $ 1,843,354 $ 1,110,611 $ (979,167) $ 1,974,798 $ 836,443
Business-type activities:
Loans payable $ 4,090,284 $ $ (245,356) $ 3,844,928 $ 237,241
Capital leases 235,176 (62,092) 173,084 66,150
OPEB (see note 15) 19,355 9,079 28,434
Compensated absences
payable 12,852 6,686 (4,050) 15,488 11,539
Total $ 4,357,667 $ 15,765 $ (311,498) $ 4,061,934 $ 314,930
Governmental activities other post employment benefit obligations and compensated absences
are expected to be paid out of the general fund.
Loans Payable
$4,893,673 Promissory Notes
The Village Council adopted Resolution No. 23-2006 authorizing the issuance of a note in the
amount of $4,893,673 to finance certain capital expenditures relating to the municipal golf
course and country club. The revenues of the Country Club are pledged to secure the loan.
Principal and interest payments are due semi-annually in the amount of $197,450, with a final
maturity date of April 1, 2024. The interest rate on the loan is 4.11%and is subject to adjustment
in the event of taxability of the interest on this note. As of September 30, 2011, the principal
amount outstanding was $3,844,928 and was for the purpose of business-type activities.
THE VILLAGE OF NORTH PALM BEACH, FLORIDA
Notes to the Basic Financial Statements
September 30, 2011
46
NOTE 8 – LONG TERM LIABILITIES (Continued)
$4,893,673 Promissory Notes (Continued)
Annual debt service requirements to maturity are as follows:
Business-type activities:
Year Ending Principal Interest Total
2012 $ 237,241 $ 157,659 $ 394,900
2013 247,646 147,254 394,900
2014 258,036 136,864 394,900
2015 268,862 126,038 394,900
2016 279,810 115,090 394,900
2017 - 2021 1,586,923 387,577 1,974,500
2022 - 2024 966,410 63,590 1,030,000
$ 3,844,928 $ 1,134,072 $ 4,979,000
$284,000 Capital Lease
The Village entered into a three year capital lease agreement for the purpose of financing the
lease-purchase of $284,000 of equipment for the Country Club in October 2009. Principal and
interest payments are due monthly, with a final maturity date in December 2013. The final
payment includes a balloon payment of $96,000. As of September 30, 2011, the principal
amount outstanding was $173,084 and the net book value of the equipment was $147,920. The
rate used to impute interest was 6.3%.
Annual debt service requirements to maturity are as follows:
Year Ending Principal Interest Total
2012 $ 66,150 $ 9,085 $ 75,235
2013 106,934 1,605 108,539
$ 173,084 $ 10,690 $ 183,774
THE VILLAGE OF NORTH PALM BEACH, FLORIDA
Notes to the Basic Financial Statements
September 30, 2011
47
NOTE 8 – LONG TERM LIABILITIES (Continued)
Claims and Settlements
Effective October 1, 2006, the Village discontinued its participation in the Southeast Risk
Management Association (SERMA) and joined the Florida Municipal Insurance Trust (FMIT).
However, as a former participant in SERMA, the Village is liable for claims incurred through
September 30, 2006. At September 30, 2011, there is a long-term governmental liability of
$28,434 for pending claims activity for SERMA (see related Note 9.) The liability is an
estimated based on the 2010 valuation; the 2011 valuation is not yet available. The liability is
included in governmental noncurrent liabilities in the Statement of Net Assets.
SERMA, a quasi-governmental agency, was created by an interlocal agreement, as authorized by
Chapter 163, Florida Statutes. Participating members pool their resources so as to provide a
comprehensive risk management program, including insurance coverage, whose cost is less than
the cost of each municipality obtaining insurance separately. The members are subject to
supplemental assessments in the event of deficiencies, except to the extent that deficiencies result
from a specific claim against a member in excess of the reinsurance available, such deficiency is
solely the responsibility of that member. SERMA reinsures for workers compensation and
property claims in excess of $250,000. Activity in the pool is allocated to participating members
based upon the cumulative contributions to the pool. The amount of settlements in SERMA
exceeded insurance coverage in the current fiscal year.
NOTE 9 – RISK MANAGEMENT
The Village is exposed to various risks of loss related to torts: theft of, damage to, and
destruction of assets; errors and omissions; and natural disasters.
The Village currently reports all of its risk management activities in the General Fund. Claims
expenditures and liabilities are reported when it is probable that a loss has occurred and the
amount of the loss can be reasonably estimated. These losses include an estimate of claims that
have been incurred but not reported.
Property and Casualty Group
Effective October 1, 2006, the Village discontinued its participation in the Southeast Risk
Management Association (SERMA) and joined the Florida Municipal Insurance Trust (FMIT).
However, as a former participant in SERMA, the Village is liable for claims incurred through
September 30, 2006.The governmental liability of $28,434 is for pending claims activity for
SERMA (See related Note 8).
The Village is also covered by Florida Statutes under the Doctrine of Sovereign Immunity which
effectively limits the amount of liability of municipalities to individual claims of
$100,000/$200,000 for all claims relating to the same incident.
THE VILLAGE OF NORTH PALM BEACH, FLORIDA
Notes to the Basic Financial Statements
September 30, 2011
48
NOTE 10 – EMPLOYEE RETIREMENT PLANS
The Village maintains the following two separate single employer defined benefit plans: Village
of North Palm Beach Fire and Police Retirement Fund, covering firefighters and police officers,
and Village of North Palm Beach General Employees Retirement Fund, covering substantially
all other full-time Village employees. Both plans are reported as pension trust funds and
included as part of the Village’s reporting entity. The Police and Fire Fund will issue separate
financial statements for the year ended September 30, 2011, the report may be obtained from the
Village Clerk. The General Employees Plan will not issue separate financial statements.
Additional information on these plans can be found beginning on page 64.
Each plan has its own board that acts as plan administrator and trustee: Board of Trustees (for
the Fire and Police Retirement Fund) and General Employees Retirement Board. Each plan’s
assets may only be used for the payment of benefits to the members and beneficiaries of the plan
in accordance with the terms of each plan document. The costs of administering each plan are
financed in the appropriate pension trust fund.
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
All Retirement Plans
Basis of Accounting. The retirement plans are reported on the accrual basis of accounting. Plan
member and state contributions are recognized as revenues in the period that the contributions
are due. Employer contributions to each plan are recognized when due and the employer has
made a formal commitment to provide the contributions. Benefits and refunds are recognized
when due and payable in accordance with the terms of each plan.
Method Used to Value Investments. Investments are reported at fair value and are managed by
third party money managers. The Village’s independent custodians and individual money
managers price each instrument using various third party pricing sources.
Investments Concentrations. The following investments represent concentrations of 5% or more
of net plan assets in investments that are not issued or guaranteed by the U.S. government.
General Employees Retirement Fund
No nongovernmental investments exceed 5% of net plan assets.
Fire and Police Retirement Fund
No nongovernmental investments exceed 5% of net plan assets.
THE VILLAGE OF NORTH PALM BEACH, FLORIDA
Notes to the Basic Financial Statements
September 30, 2011
49
NOTE 10 – EMPLOYEE RETIREMENT PLANS (Continued)
PLAN DESCRIPTION AND CONTRIBUTION INFORMATION
The following schedule is provided for general information purposes only and is derived from
the respective actual reports and Village information for the two retirement plans as of
October 1, 2010, the date of the latest actuarial valuation. Plan participants should refer to the
appropriate source documents for more complete information on the plans.
General Employees’ Fire and Police
Plan Description:
Authority Village Ordinance Village Ordinance/State
Asset Valuation:
Reporting Fair Value Fair Value
Legal Reserves None None
Long-Term Receivable None None
Internal/Participant Loans None None
Membership of each plan consisted of the following at October 1, 2010, the date of the latest
actuarial valuation:
GERF F&P
Active Participants:
Vested 49 14
Non-vested 15 38
Retirees and Beneficiaries receiving benefits 7 9
Terminated vested members 48 10
Total 119 71
General Employees' Retirement System
Plan Description. The plan is established under Code of Ordinances for the Village of North
Palm Beach, Florida, Part II, Chapter 2, and was most recently amended under Ordinance No.
2010-07 passed and adopted on May 27, 2010. The Plan is also governed by certain provisions
of Part VII, Chapter 112, Florida Statutes and the Internal Revenue Code. The Plan provides
retirement benefits as well as death benefits. All full time general employees who are not sworn
police officers or firefighters shall become members of the system on October 1st following
completion of 12 months of employment as a condition of employment. For those employees
retired before February 1, 1982, those employees hired after September 30, 2000, or those
employees hired before October 1, 2000, who elect to contribute an extra 2%, a 3% Cost of
Living increase is paid annually from the Plan. Authority to establish and amend the benefit
provisions of the plan rests with the Village Council.
THE VILLAGE OF NORTH PALM BEACH, FLORIDA
Notes to the Basic Financial Statements
September 30, 2011
50
NOTE 10 – EMPLOYEE RETIREMENT PLANS (Continued)
General Employees' Retirement System (Continued)
All benefits vest based on the following years of credited service.
Years of
Credited Service Vested %
Under 5 0%
5 or 6 50%
7 or 8 75%
9 or more 100%
Employees become eligible for normal retirement benefits after attaining the age of 60 and
completing nine years of credited service, or attaining the age of 65 (depending on employee
contribution rate). The normal retirement benefit consists of a life annuity, options available,
(subject to cost of living increases not to exceed 3% a year), of either 2%, 2.25%, or 2.5%
(depending on employee contribution rate) of Average Monthly earnings (AME) times credited
service up to 20 years plus 1% of AME times credited service over 20 years. Early retirement
benefits can be received at age 55. The benefit is determined as for normal retirement and
payable at normal retirement date or payable immediately after reduction by 5% for each year by
which the benefit commencement date precedes the normal retirement date. If an active member
dies, his beneficiary receives a refund of member contributions without interest. For a member
who is age 55 and has at least five years of service but who dies before commencement of
retirement benefits, a monthly benefit is payable to the designated beneficiary; the benefit is
calculated as though the member had retired on his date of death and payable according to option
elected by the employee. For an active member who has at least five years of credited service
and dies prior to reaching normal retirement date, a benefit equal to his vested accrued benefit
will be paid to his beneficiary for ten years. If an employee terminates his employment, he is
entitled to the following:
- With less than five years of credited service, a refund of member contributions
without interest and no other benefit.
- With five or more years of credited service, a refund of member contributions, the
vested accrued benefit payable at normal retirement date or at any time after age 55
is attained, with the benefit being subject to the same reduction as for early
retirement benefits. The vesting schedule is listed above.
"Average monthly earnings" is the average during the 5 years within the last 10 years of
employment which produces the highest average.
THE VILLAGE OF NORTH PALM BEACH, FLORIDA
Notes to the Basic Financial Statements
September 30, 2011
51
NOTE 10 – EMPLOYEE RETIREMENT PLANS (Continued)
General Employees' Retirement System (Continued)
"Credited service" consists of the total number of years and fractional parts of years of actual
service with the Village and shall apply to an employee whose employment is terminated with
the Village and who recommences fulltime employment within two years from the date of
termination.
Contributions. General employees may contribute 6%, 4%, 2% or 0% of earnings as elected by
the employee, with the retirement benefit received being based on the amount contributed. The
Village is required to contribute the amount necessary to fund the Plan properly according to the
Plan’s actuary. Contribution requirements of plan members and the Village are established and
may be amended by the Village Council.
Fire and Police Retirement System
Plan Description. The plan is established under Code of Ordinances for the Village of North
Palm Beach, Florida, Part II, Chapter 2, and was most recently amended under Ordinance No.
2010-01 passed and adopted on January 14, 2010. The Plan is also governed by certain
provisions of Part VII, Chapter 112, Florida Statutes and the Internal Revenue Code. The plan
provides retirement benefits as well as death and disability benefits. All benefits vest after ten
years of credited service. All fulltime police officers or firefighters are eligible for membership
immediately upon hire. Previously, members were not eligible until October 1st following
completion of 12 months of employment. Cost of living adjustments (COLA) are provided
annually each October 1, to reflect changes in CPI (subject to maximum increases or decreases
of 3% per year). Authority to establish and amend the benefit provisions of the plan rests with
the Village Council. Employees become eligible for normal retirement benefits after attaining
the age of 55, or the date on which the member attains age 52 and 25 credited years of service.
Previously, employees became eligible for normal retirement benefits after attaining the age of
55, only. The normal retirement benefit consists of ten years certain and life thereafter, with
other options available, (subject to cost of living adjustments not to exceed 3% a year), of 2.5%
of AME times the years of credited services, with a maximum benefit of 60% of AME.
Members are eligible for non-service connected disability, after ten years of credited service and
a total and permanent disability. For service connected disability, a total and permanent
disability with no service requirement, the disability benefit consists of a ten year certain and life
annuity that can be provided by the single-sum value of the member’s accrued pension benefit,
THE VILLAGE OF NORTH PALM BEACH, FLORIDA
Notes to the Basic Financial Statements
September 30, 2011
52
NOTE 10 – EMPLOYEE RETIREMENT PLANS (Continued)
Fire and Police Retirement System (Continued)
Plan Description (Continued)
but is at least 42% of AME for service connected disability and at least 25% of AME for non-
service connected disability. See the description of the General Employees’ Retirement System
for the remainder of the benefits, except that early retirement and termination benefits for vested
members can be received at age 50.
Contributions. Members are required to contribute 2% of their basic compensation to the plan.
The Village is required to contribute the remaining amount to fund the plan using the Entry Age
Actuarial Cost Method. Contribution requirements of plan members and the Village are
established and may be amended by the Village Council.
The Florida Constitution requires local governments to make the actuarially determined
contribution. The Florida Division of Retirement reviews and approves each local government’s
actuarial report prior to its being appropriated for use for funding purposes. Additionally, the
State collects locally authorized insurance premium surcharges which can only be distributed
after the State has ascertained that the local government has met its actuarial funding requirement
for the then most recently completed fiscal year. Contributions to the Plan from the State of
Florida totaled $264,570 during the fiscal year ended September 30, 2011.
All Retirement Plans
Annual Pension Cost and Net Pension Obligation. The Village's 2011 annual pension cost and
actual contributions for each plan are shown on the next page. The required contributions were
determined as part of the October 1, 2010, actuarial valuation for each plan. State law allows the
Village to use a portion of the State contribution to offset the Village’s pension cost.
Components of Annual Pension Cost and Net Pension Obligation
Annual Required Eligible
Pension Village State
Cost Contribution Contribution
General Employees’ Retirement Fund $509,921 $503,477 N/A
Fire and Police Retirement Fund $869,409 $638,713 $230,696
THE VILLAGE OF NORTH PALM BEACH, FLORIDA
Notes to the Basic Financial Statements
September 30, 2011
53
NOTE 10 – EMPLOYEE RETIREMENT PLANS (Continued)
The following schedule was determined as part of the October 1, 2010, actuarial valuation for the
General Employees’ and Fire and Police Retirement Plans.
General
Employees’ Fire and Police
Annual required contribution (ARC) $ 503,477 $ 869,409
Interest on net pension obligation (NPO) (13,900) (a)
Adjustment to ARC 20,344 (a)
Annual pension cost 509,921 869,409
Actual contributions 651,159 872,067
Increase in NPO (141,238) (2,658)
NPO at beginning of year (185,330) (255,334)
NPO at end of year $(326,568) $(257,992)
(a) Information was not provided in the October 1, 2010, actuarial valuation.
Three-Year Trend Information
Annual Percentage Net Pension
Year Pension Annual of APC Obligation
Ended Cost (APC) Contribution Contributed (Asset)
General
Employees’ 9/30/09 767,429 765,381 99.7% (165,505)
9/30/10 739,704 759,529 102.7% (185,330)
9/30/11 509,921 651,159 127.7% (326,568)
Fire and
Police 9/30/09 651,838 734,826 112.7 % (264,986)
9/30/10 893,728 884,076 98.9 % (255,334)
9/30/11 869,409 872,067 100.3 % (257,992)
THE VILLAGE OF NORTH PALM BEACH, FLORIDA
Notes to the Basic Financial Statements
September 30, 2011
54
NOTE 10 – EMPLOYEE RETIREMENT PLANS (Continued)
The following are the actuarial methods and significant actuarial assumptions:
General Employees’ Fire and Police
Valuation date 10/1/2010 10/1/2010
Actuarial Cost Method Frozen Entry Age Aggregate
Amortized Method Level percent closed N/A (1)
Remaining Amortization
Period 30 years N/A (1)
Asset Valuation Method
Difference between actual
and expected return
recognized over five years.
Five year smooth market.
Actuarial assumptions:
Investment rate of return*
8% up to retirement,
5.25% thereafter.
8%
Projected salary increase* 5.5% 6%
*Includes inflation at 4% 4%
Cost of living adjustments
3% for those retired before
2/1/82 or who contribute
an extra 2%.
3%
(1) The aggregate actuarial cost method does not identify or separately amortize unfunded
actuarial liabilities.
Schedule of Funding Progress
As noted above, the Fire and Police Retirement System utilizes the aggregate actuarial cost
method to determine contributions to the Plan. This method does not identify or separately
amortize unfunded actuarial liabilities. The required schedule of funding progress immediately
following the notes to the financial statements presents multiyear trend information about
whether the actuarial value of plan assets is increasing or decreasing over time relative to the
actuarial accrued liability for benefits. The schedule of funding progress was prepared using the
entry age actuarial cost method to provide information that serves as a surrogate for the funding
progress of the Plan.
THE VILLAGE OF NORTH PALM BEACH, FLORIDA
Notes to the Basic Financial Statements
September 30, 2011
55
NOTE 10 – EMPLOYEE RETIREMENT PLANS (Continued)
Fire and Police:
Actuarial
Valuation
Date
Actuarial
Value of
Assets
Actuarial
Accrued
Liability
(AAL)
Unfunded
AAL
Funded
Ratio
Covered
Payroll
Unfunded
AAL
as % of
Covered
Payroll
10/01/10 11,240,540 14,121,958 2,881,418 79.6% 3,922,596 73.46%
General Employees’:
Actuarial
Valuation
Date
Actuarial
Value of
Assets
Actuarial
Accrued
Liability
(AAL)
Unfunded
AAL
Funded
Ratio
Covered
Payroll
Unfunded
AAL
as % of
Covered
Payroll
10/01/10 6,863,057 10,516,549 3,653,492 65.3% 3,424,324 106.7%
NOTE 11 – PENSION PLAN FINANCIAL INFORMATION
Generally accepted accounting principles (GAAP) requires that financial statements for
individual pension plans be presented in the notes to the financial statements of the primary
government if separate GAAP financial reports have not been issued. The Volunteer Fire and
General Employees’ pension funds do not have separate GAAP reports issued, and the financial
information for these is presented below.
STATEMENT OF FIDUCIARY NET ASSETS
EMPLOYEE RETIREMENT FUNDS
SEPTEMBER 30, 2011
Volunteer
Fire Pension
General
Employee’s
Pension
Assets
Cash and cash equivalents $ $ 233,423
Investments:
Equity mutual funds 4,056,958
Fixed income mutual funds 2,589,419
Accounts receivable 23,941
Total assets 6,903,741
Liabilities
Accounts payable 11,959
Net Assets
Held in trust for pension benefits and
other purposes $
$ 6,891,782
THE VILLAGE OF NORTH PALM BEACH, FLORIDA
Notes to the Basic Financial Statements
September 30, 2011
56
NOTE 11 – PENSION PLAN FINANCIAL INFORMATION (Continued)
STATEMENT OF CHANGES IN FIDUCIARY NET ASSETS
EMPLOYEE RETIREMENT FUNDS
For the Fiscal Year Ended September 30, 2011
Volunteer Fire
Pension
General
Employees’
Pension
Additions
Contributions
Employer $ 1,202 $ 651,159
Plan members 169,948
Total contributions 1,202 821,107
Investment earnings
Dividends and interest 2,279 34,409
Net decrease in the fair value
of investments (76,944)
Less investment expense (62,774)
Total investment earnings 2,279 (105,309)
Total additions 3,481 715,798
Deductions
Administration 17,985
Benefits 109,707 29,679
Refund of contributions 32,479
Total deductions 109,707 80,143
Change in net assets (106,226) 635,655
Net assets - beginning 106,226 6,256,127
Net assets - ending $ $ 6,891,782
NOTE 12 – ON-BEHALF PAYMENTS
The state makes a contribution to the Fire and Police Officers’ Retirement System from the
firefighters’ and police officers’ Insurance Premium Tax. For the fiscal year ended September
30, 2011, $264,570 was recorded as revenues and expenditures in the On-Behalf Pension
Contribution Special Revenue Fund relating to on-behalf payments received from the state.
THE VILLAGE OF NORTH PALM BEACH, FLORIDA
Notes to the Basic Financial Statements
September 30, 2011
57
NOTE 13 – DEFINED CONTRIBUTION PLAN
Effective October 1, 2006, all employees of the Village may participate in one of three Money
Purchase Plans that are qualified Defined Contribution Plans adopted under the provisions of
Internal Revenue Code Section 401(a). The three pension plans include Directors, General
Employees, and Municipal Employees. The defined contribution plans are administered by
International City/County Management Association and Retirement Corporation (ICMA-RC).
The ICMA-RC is a nonprofit corporation organized and existing under the laws of the State of
Delaware. Contribution requirements of employees’ and the Village are established and may be
amended by the Village Council.
The vesting period for each defined contribution plan is five years, with a vesting of zero percent
in the first year, and a vesting of twenty-five percent for each year thereafter. While the plans
will not provide for retroactive funding, the vesting period shall run from each employee’s
original date of hire. No loans are permitted by the plan. The normal retirement age for the plan
shall be age sixty. There is no waiting period for participation in the plan. The minimum age for
participation is eighteen.
The Village contributes 15% of participant earnings for the plan year. Earnings include regular
and bonus compensation, but do not include overtime or commissions. Employee contributions
are voluntary, after-tax contributions that are not matched by the Village. Employees may
contribute 3%, 5%, 10%, or 15% of earnings to the plan. Contributions are remitted to the trusts
every payroll period.
Because the Village has little administrative involvement and does not perform the investing
function for funds in the plans, the Village’s activities do not meet the criteria for inclusion in the
fiduciary funds of a government. Consequently, the plans are not included in the Village’s financial
statements.
Plan detail for participating employees at September 30, 2011, is listed below:
Director’s General
Employees
Municipal
Employees
Total
Village contributions $70,439 $61,357 $58,341 $190,137
Employee contributions $30,854 $13,807 $16,275 $60,936
THE VILLAGE OF NORTH PALM BEACH, FLORIDA
Notes to the Basic Financial Statements
September 30, 2011
58
NOTE 14 – DEFERRED COMPENSATION PLAN ASSETS
Employees of the Village may participate in a deferred compensation plan adopted under the
provisions of Internal Revenue Code Section 457 (Deferred Compensation Plans with Respect to
Service for State and Local Governments).
The deferred compensation plan is available to all employees of the Village. Under the plan,
employees may elect to defer a portion of their salaries and avoid paying taxes on the deferred
portion until the withdrawal date. The deferred compensation amount is not available for
withdrawal by employees until termination, retirement, death, or unforeseeable emergency. A third
party administers the deferred compensation plan.
In 1998, the Village Adopted GASB-32, Accounting and Financial Reporting for Internal
Revenue Code Section 457 Deferred Compensation Plans. The Village modified its Deferred
Compensation Plan to conform with the changes in the Internal Revenue Code brought about by the
Small Business Job Protection Act of 1996 (the “Act”). The Act requires that eligible deferred
compensation plans established and maintained by governmental employers be amended to provide
that all assets of the plan be held in trust, or under one or more appropriate annuity contracts or
custodial accounts, for the exclusive benefit of plan participants and their beneficiaries. As a result
of this change, these plan assets are not property of the Village and are not subject to the claims of
the Village’s general creditors.
Because the Village has little administrative involvement and does not perform the investing
function for funds in the Plan, the Village’s activities do not meet the criteria for inclusion in the
fiduciary funds of a government.
NOTE 15 – OTHER POST EMPLOYMENT BENEFITS
The Village implemented Governmental Accounting Standards Board Statement 45 (GASB 45),
Accounting and Financial Reporting by Employers for Postemployment Benefits Other Than
Pensions, effective October 1, 2008. The Village elected to implement prospectively, and the
change in accounting principle had no effect on changes in net assets/fund equity for prior
periods. Retirees of the Village pay an amount equal to the actual premium for health insurance
charged by the carrier, but there is an implied subsidy in the healthcare insurance premium for
retirees because the premium charged for these retirees is the same as the premium charged for
active employees, who are younger than retirees on average. This implied subsidy constitutes
other postemployment benefits (OPEB) under GASB 45.
Plan Description
The Village provides a single employer defined benefit health care plan to all of its employees.
The plan allows its employees and their beneficiaries, to continue to obtain health and dental
benefits upon retirement. The normal retirement age for police and firefighters is 55; the normal
retirement age for all other Village employees is either age 60 or 65, depending on the option
selected by the employee.
THE VILLAGE OF NORTH PALM BEACH, FLORIDA
Notes to the Basic Financial Statements
September 30, 2011
59
NOTE 15 – OTHER POST EMPLOYMENT BENEFITS (Continued)
Plan Description (Continued)
The benefits of the plan are in accordance with Florida Statutes, which are the legal authority for
the plan. The plan has no assets and does not issue a separate financial report.
Funding Policy
The Village does not directly make a contribution to the plan on behalf of retirees. Retirees and
their beneficiaries pay the same group rates as are charged to the Village for active employees by
its healthcare provider. However, the Village’s actuaries, in their actuarial valuation, calculate
an offset to the cost of these benefits as an Employer Contribution, based upon an implicit rate
subsidy. This offset equals the total age-adjusted costs paid by the Village or its active
employees for coverage of the retirees and their dependents for the year net of the retiree’s own
payments for the year.
Annual OPEB Cost and Net OPEB Obligation
The annual other post employment benefit (OPEB) cost is calculated based on the annual
required contribution of the employer, an amount actuarially determined in accordance with
GASB Statement No. 45. The annual required contribution represents a level of funding that, if
paid on an ongoing basis, is projected to cover normal cost each year and to amortize any
unfunded actuarial liabilities over a period not to exceed 30 years.
The annual OPEB cost and the net OPEB obligation for the Village for the current year and the
related information is as follows:
Required contribution rates:
Employer Pay-as-you-go
Plan members N/A
Normal cost $ 245,351
Interest on normal cost 9,814
Amortization 152,437
Interest on amortization 6,097
Interest on net unfunded OPEB obligation 21,506
Annual OPEB cost 435,205
Contributions made (183,000)
Increase in net OPEB obligation 252,205
Net OPEB obligation October 1, 2010 537,647
Net OPEB obligation September 30, 2011 $ 789,852
THE VILLAGE OF NORTH PALM BEACH, FLORIDA
Notes to the Basic Financial Statements
September 30, 2011
60
NOTE 15 – OTHER POST EMPLOYMENT BENEFITS (Continued)
Trend Information
Three-Year Trend Information
Percentage of
Fiscal Annual Annual Net
Year OPEB OPEB Cost OPEB
End Cost Contributed Obligation
09/30/09 $413,699 28.7% $295,142
09/30/10 $425,505 43.0% $537,647
09/30/11 $435,205 42.0% $789,852
Funded Status
The funded status of the plan as of most recent actuarial valuation date was as follows:
Actuarial valuation date 10/01/2008
Actuarial accrued liability $2,741,387
Actuarial value of plan assets $
Unfunded actuarial accrued liability (UAAL) $2,741,387
Funded ratio 0.0%
Covered payroll $6,231,104
UAAL as a percentage of covered payroll 44.0%
Actuarial valuations of an ongoing plan involve estimates of the value of reported amounts and
assumptions about the probability of occurrence of events far into the future. Amounts
determined regarding the funded status of the plan and the annual required contributions of the
employer are subject to continual revision as actual results are comparable with past expectations
and new estimates are made about the future. The schedule of funding progress presented as
required supplementary information following the notes to the financial statements, will present
multi-year trend information that shows whether the actuarial value of plan assets is increasing or
decreasing over time relative to the actuarial accrued liability for benefits. The Village has not
contributed assets to the plan at this time.
Actuarial Methods and Assumptions
Projections of benefits are based on the substantive plan (the plan as understood by the employer
and plan members) and includes the types of benefits in force at the valuation date and the
pattern of sharing benefit costs between the Village and the plan members to that point.
Actuarial calculations reflect a long-term perspective and employ methods and assumptions that
are
THE VILLAGE OF NORTH PALM BEACH, FLORIDA
Notes to the Basic Financial Statements
September 30, 2011
61
NOTE 15 – OTHER POST EMPLOYMENT BENEFITS (Continued)
designed to reduce short-term volatility in actuarial accrued liabilities and the actuarial value of
assets. Significant methods and assumptions were as follows:
Actuarial valuation date 10/01/2008
Actuarial cost method Projected Unit Credit
Amortization method Level dollar, 30 Years, closed
Remaining amortization period 28 years
Asset valuation method Unfunded
Actual assumptions:
Investment rate of return 4%
Healthcare cost trend 6.6% for 2011 decreasing to 4% in 2083
NOTE 16 – JOINTLY GOVERNED ORGANIZATION
The Village, through an interlocal agreement with certain other municipalities and Palm Beach
County, created the Seacoast Utility Authority (“Seacoast”) which provides water and sewer
service to the citizens of each of the participating municipalities and a portion of Palm Beach
County. Seacoast’s governing board consists of one member from each participating entity.
Seacoast is an Independent Authority organized under the laws of the State of Florida, and the
Village has no participating equity ownership in Seacoast. The Village paid $153,968 to
Seacoast during the fiscal year for water and sewer service.
NOTE 17 – INTERFUND RECEIVABLES, PAYABLES, AND TRANSFERS
The composition of interfund balances at September 30, 2011, is as follows:
Receivable Fund Payable Fund Amount
Capital Projects Fund Recreation Special Revenue Fund $44,028
The outstanding balance between funds results mainly from the time lag between the dates that
payments between funds are made. Interfund transfers during the year ended September 30,
2011, are as follows:
Transfer Out:
General Fund
Transfer in:
Capital Projects Fund $1,334,934
The transfers from the General Fund to the other governmental funds were to move restricted
and unrestricted General Fund revenues to finance various programs that the government must
account for in other funds in accordance with budgetary authorizations, including amounts
provided as subsidies or matching funds for various grant programs.
THE VILLAGE OF NORTH PALM BEACH, FLORIDA
Notes to the Basic Financial Statements
September 30, 2011
62
NOTE 18 – CONTRACTS, COMMITMENTS AND CONTINGENCIES
Contingencies
The Village is involved in various litigations and claims arising in the course of operations. It is
the opinion of legal counsel that the likelihood of unfavorable outcome and the amounts of
potential losses cannot be reasonably determined for all claims at this time.
NOTE 19 – ACCOUNTING CHANGE
GASB Statement 54, Fund Balance Reporting and Governmental Fund Type Definitions, enhances
the usefulness of fund balance information by providing clearer fund balance classifications that
can be more consistently applied and by clarifying the existing governmental fund type definitions.
The Village implemented this standard in fiscal year 2011. Changes to the government fund type
fund balance reporting are reflected in the financial statements and schedules. Related disclosures
are included in Note 1.
NOTE 20 – SUBSEQUENT EVENT
On January 5, 2012, the Village Council terminated the City Manager without cause. Under the
terms of his employment contract he is due six months base salary as severance pay. This
amounts to $67,500 and was subsequently paid.
REQUIRED SUPPLEMENTARY INFORMATION OTHER THAN MD&A
FIDUCIARY FUNDS
Pension Trust Funds
General Employees Pension Trust Fund
Fire and Police Officers Pension Trust Fund
Actuarial UAAL as a
Actuarial Accrued Unfunded Percentage
Actuarial Value of Liability AAL Funded Covered of Covered
Valuation Assets (AAL) (1)(UAAL)Ratio Payroll Payroll
Date (a)(b)(b-a)(a/b)(c)((b-a)/c)
Other Post Employment Benefits (OPEB)
10/01/08* $ 2,741,387$ 2,741,387$ 0.0%6,231,104$ 44.0%
* This was the only actuarial valuation performed to date.
(1) Projected unit credit
The schedule of funding progress presented above will present multi-year trend information that
shows whether the actuarial value of plan assets is increasing or decreasing over time
relative to the actuarial accrued liability for benefits. Because the fiscal year ended September 30,
2009, was the year of implementation of GASB 45, and the Villiage elected to apply the statement
prospectively, only one year is presented in the schedule at this time. In future years, required
trend data will be presented. The Villiage has not contributed assets to the plan at this time.
THE VILLAGE OF NORTH PALM BEACH, FLORIDA
Required Supplemental Information
September 30, 2011
Schedule of Funding Progress
63
Actuarial
Accrued UAAL as a
Actuarial Liability Unfunded Percentage
Actuarial Value of (AAL)-AAL Funded Covered of Covered
Valuation Assets Entry Age(1)(UAAL)Ratio Payroll Payroll
Date (a)(b)(b-a)(a/b)(c)((b-a)/c)
General Employees Retirement Fund (1)
10/1/2005 3,817,605$ 9,116,599$ 5,298,994$ 41.88%3,220,258$ 164.55%
10/1/2006 5,283,023 10,490,332 5,207,309 50.36%3,680,960 141.47%
10/1/2007 6,481,382 10,997,783 4,516,401 58.93%3,238,894 139.44%
10/1/2008 5,824,447 10,138,981 4,314,534 57.45%2,977,995 144.88%
10/1/2009 6,048,808 8,328,331 2,279,523 72.63%3,046,421 74.83%
10/1/2010 6,863,057 10,516,549 3,653,492 65.26%3,424,324 106.69%
Fire and Police Retirement Fund (2)
10/1/2005 7,600,134$ 8,692,747$ 1,092,613$ 87.43%2,405,634$ 45.42%
10/1/2006 8,312,363 10,294,848 1,982,485 80.74%2,798,919 70.83%
10/1/2007 9,228,537 10,836,562 1,608,025 85.16%3,110,081 51.70%
10/1/2008 10,376,733 11,719,336 1,342,603 88.54%3,253,109 41.27%
10/1/2009 10,650,648 12,656,293 2,005,645 84.15%3,488,338 57.50%
10/1/2010 11,240,540 14,121,958 2,881,418 79.60%3,922,596 73.46%
General Employees Retirement Fund (1)
The General Employees Retirement Fund uses the frozen entry age actuarial cost method.
Fire and Police Retirement Fund (2)
The Fire and Police Retirement Fund uses the aggregate actuarial cost method to
determine contributions to the Plan. This method does not identify or separately amortize unfunded
actuarial liabilities. The schedule of funding progress presented above was prepared using the entry age
actuarial cost method to provide information that serves as a surrogate for the funding progress of the Plan.
THE VILLAGE OF NORTH PALM BEACH, FLORIDA
Required Supplemental Information
September 30, 2011
Schedule of Funding Progress
64
THE VILLAGE OF NORTH PALM BEACH, FLORIDA
Required Supplemental Information
Schedule of Employer and State Contributions
Fiscal Year Annual
Ended Required Actual State Percentage
September 30 Contribution Contribution Contribution Contributed
General Employees Retirement Fund
2006 1,007,695$ 1,007,695$ N/A 100.0%
2007 866,069 873,872 N/A 100.9%
2008 875,126 876,712 N/A 100.2%
2009 761,943 765,381 N/A 100.5%
2010 739,767 741,392 N/A 100.2%
2011 509,921 651,159 N/A 127.7%
Fire and Police Retirement Fund
2006 690,186$ 551,986$ 138,200$ 100.0%
2007 539,651 401,451 138,200 100.0%
2008 715,784 580,463 138,200 100.4%
2009 728,729 596,626 138,200 100.8%
2010 884,415 653,719 230,696 100.0%
2011 869,409 641,371 230,696 100.3%
September 30, 2011
65
General Employees Police and Fire
Retirement Fund Retirement Fund
Contribution rates as of 9/30/11:
Village 15.78%24.21%
Plan Members 6.00% (1)2.00%
Actuarially Determined Contribution $509,921 $869,409
Contributions Made $651,159 $872,627
Valuation date 10/1/2009 10/1/2009
Actuarial Cost Method Frozen Entry Age Aggregate
Amortized Method Level percent N/A (2)
closed
Remaining Amortization Period 30 years N/A (2)
Asset Valuation Method Difference between Five year
actual and expected smooth
return recognized market
over five years.
Administrative Costs Expenses paid out of the Expenses paid out of the
fund other than investment fund other than investment
related expenses are related expenses are
assumed to be equal to the assumed to be equal to the
average of actual expenses average of actual expenses
over the previous two years.over the previous two years.
Actuarial Assumption:
Investment rate of return *8% up to retirement 8%
5.25% thereafter.
Projected salary increase *5.5%6%
*Includes inflation at 4%4%
Cost of living adjustments 3% for those retired 3%
before 2/1/82 or
who contribute an
extra 2%.
(1) Except for certain members who have elected not to contribute and for other members who have elected
to contribute only 2% or 4%.
(2) The aggregate actuarial cost method does not identify or separately amortize unfunded actuarial liabilities.
THE VILLAGE OF NORTH PALM BEACH, FLORIDA
Notes to the Trend Data
September 30, 2011
66
GENERAL FUND
THE VILLAGE OF NORTH PALM BEACH, FLORIDA
Schedule of Revenues, Expenditures, and Changes
in Fund Balance - Budget and Actual
General Fund
For the Year Ended September 30, 2011
Variance with
Final Budget
Budgeted Amounts Actual Positive
Original Final Amounts (Negative)
Revenues
Taxes 13,550,692$ 13,550,692$ 14,090,966$ 540,274$
Licenses and permits 658,800 658,800 959,098 300,298
Intergovernmental 1,228,726 1,228,726 1,287,638 58,912
Charges for services 1,845,027 1,845,027 1,934,424 89,397
Fines and forfeitures 130,000 130,000 164,366 34,366
Investment 84,027 84,027 97,743 13,716
Miscellaneous 8,800 8,800 59,462 50,662
Total revenues 17,506,072 17,506,072 18,593,697 1,087,625
Expenditures
Current
General government 2,455,316 2,444,898 2,388,151 56,747
Public safety 7,155,987 6,870,987 6,788,712 82,275
Public works 4,126,912 4,142,131 4,044,642 97,489
Community development and planning 819,557 894,602 790,937 103,665
Leisure services - recreation 2,411,375 2,374,099 2,295,959 78,140
Other government 218,827 22,250 14,090 8,160
Capital outlay 318,098 373,449 288,514 84,935
Total expenditures 17,506,072 17,122,416 16,611,005 511,411
Excess of revenues over
expenditures 383,656 1,982,692 1,599,036
Other financing uses
Transfer out (1,334,934) (1,334,934)
Total other financing uses (1,334,934) (1,334,934)
Net change in fund balances $ (951,278)$ 647,758 1,599,036$
Fund Balances
Beginning of year 11,052,909
End of year 11,700,667$
67
THE VILLAGE OF NORTH PALM BEACH, FLORIDA
Notes to the Budgetary
Required Supplementary Information (RSI)
General Fund
September 30, 2011
Note 1 - Basis of Accounting
Generally accepted accounting principles (GAAP) serve as the budgetary basis of accounting.
68
OTHER SUPPLEMENTARY INFORMATION
GENERAL FUND
THE VILLAGE OF NORTH PALM BEACH, FLORIDA
Schedule of Departmental Expenditures - Budget and Actual
General Fund
For the Year Ended September 30, 2011
Variance with
Final Budget
Original Final Positive Percent
Budget Budget Actual (Negative)Variance
Village Council
Personal services 50,513$ 50,513$ 50,455$ 58$ 0.11
Operating expenses 77,983 81,183 81,183 0.00
Total Village Council 128,496 131,696 131,638 58 0.04
Village Manager
Personal services 296,405 324,782 324,782 0.00
Operating expenses 11,866 11,866 8,068 3,798 32.01
Total Village Manager 308,271 336,648 332,850 3,798 1.13
Village Finance
Personal services 472,169 459,669 455,364 4,305 0.94
Operating expenses 54,728 44,728 44,093 635 1.42
Total Village Finance 526,897 504,397 499,457 4,940 0.98
Village Attorney
Operating expenses 170,000 170,000 159,693 10,307 6.06
Village Clerk
Personal services 251,242 251,242 248,595 2,647 1.05
Operating expenses 29,095 19,600 9,950 9,650 49.23
Total Village Clerk 280,337 270,842 258,545 12,297 4.54
Information Technology
Personal services 267,807 265,496 256,456 9,040 3.40
Operating expenses 20,825 23,136 23,136 0.00
Total Information Technology 288,632 288,632 279,592 9,040 3.13
Human Resources
Personal services 209,226 209,226 205,821 3,405 1.63
Operating expenses 27,401 27,401 21,049 6,352 23.18
Total Human Resources 236,627 236,627 226,870 9,757 4.12
Police
Personal services 4,099,061 3,951,061 3,913,060 38,001 0.96
Operating expenses 244,086 225,086 215,132 9,954 4.42
Total Police 4,343,147 4,176,147 4,128,192 47,955 1.15
Fire Rescue
Personal services 2,482,374 2,405,374 2,399,085 6,289 0.26
Operating expenses 179,832 167,832 146,369 21,463 12.79
Total Fire Rescue 2,662,206 2,573,206 2,545,454 27,752 1.08
Public Works/Streets and Grounds
Personal services 323,825 323,825 318,170 5,655 1.75
Operating expenses 39,501 39,501 35,080 4,421 11.19
Total Public Works 363,326 363,326 353,250 10,076 2.77
(Continued)
69
THE VILLAGE OF NORTH PALM BEACH, FLORIDA
Schedule of Departmental Expenditures - Budget and Actual
General Fund
For the Year Ended September 30, 2011
Variance with
Final Budget
Original Final Positive Percent
Budget Budget Actual (Negative)Variance
(Continued)
Sanitation
Personal services 1,316,296$ 1,266,296$ 1,244,632$ 21,664$ 1.71
Operating expenses 176,200 131,200 128,030 3,170 2.42
Total Sanitation 1,492,496 1,397,496 1,372,662 24,834 1.78
Facility Services
Personal services 289,852 289,852 285,560 4,292 1.48
Operating expenses 344,700 279,700 263,007 16,693 5.97
Total Facility Services 634,552 569,552 548,567 20,985 3.68
Street Maintenance
Personal services 539,707 528,707 519,861 8,846 1.67
Operating expenses 727,638 913,857 893,569 20,288 2.22
Total Street Maintenance 1,267,345 1,442,564 1,413,430 29,134 2.02
Vehicle Maintenance
Personal services 186,433 186,433 183,067 3,366 1.81
Operating expenses 182,760 182,760 173,666 9,094 4.98
Total Vehicle Maintenance 369,193 369,193 356,733 12,460 3.37
Planning and Engineering
Personal services 205,175 205,175 199,166 6,009 2.93
Operating expenses 17,064 118,909 34,139 84,770 71.29
Total Planning and Engineering 222,239 324,084 233,305 90,779 28.01
Building
Personal services 466,774 456,974 451,873 5,101 1.12
Operating expenses 14,411 14,411 10,299 4,112 28.53
Total Building 481,185 471,385 462,172 9,213 1.95
Code Enforcement
Personal services 111,731 89,428 85,759 3,669 4.10
Operating expenses 4,402 9,705 9,701 4 0.04
Total Code Enforcement 116,133 99,133 95,460 3,673 3.71
Leisure Services-Recreation
Personal services 577,195 577,195 577,195 0.00
Operating expenses 374,085 352,824 334,355 18,469 5.23
Total Leisure Services-Recreation 951,280 930,019 911,550 18,469 1.99
Library
Personal services 538,942 508,942 481,359 27,583 5.42
Operating expenses 173,647 163,647 154,503 9,144 5.59
Total Library 712,589 672,589 635,862 36,727 5.46
(Continued)
70
THE VILLAGE OF NORTH PALM BEACH, FLORIDA
Schedule of Departmental Expenditures - Budget and Actual
General Fund
For the Year Ended September 30, 2011
Variance with
Final Budget
Original Final Positive Percent
Budget Budget Actual (Negative)Variance
(Continued)
Tennis
Personal services 102,129$ 102,129$ 90,511$ 11,618$ 11.38
Operating expenses 274,776 288,537 288,541 (4) 0.00
Total Tennis 376,905 390,666 379,052 11,614 2.97
Pool
Personal services 89,977 89,977 89,581 396 0.44
Operating expenses 193,624 203,848 203,847 1 0.00
Total Pool 283,601 293,825 293,428 397 0.14
Special Events
Operating expenses 87,000 87,000 76,067 10,933 12.57
Total Special Events 87,000 87,000 76,067 10,933 12.57
Other
Operating expenses 218,827 22,250 14,090 8,160 36.67
218,827 22,250 14,090 8,160 36.67
Non-Departmental
Operating expenses 666,690 627,690 614,572 13,118 2.09
666,690 627,690 614,572 13,118 2.09
Capital Outlay
Information Technology 9,707 9,707 9,706 1 0.01
Village Clerk 9,495 9,495
Police 73,449 73,449 72,187 1,262 1.72
Facility Services 85,000
Planning and Engineering 89,222 8,323 80,899 90.67
Leisure Services-Recreation 26,500 26,500 24,031 2,469 9.32
Pool 101,000 147,135 146,831 304 0.21
Tennis 11,800 17,941 17,941
Library 10,642
Total Capital Outlay 318,098 373,449 288,514 84,935 22.74
Total expenditures 17,506,072$ 17,122,416$ 16,611,005$ 511,411$ 2.99%
71
COMBINING FINANCIAL STATEMENTS
NONMAJOR GOVERNMENTAL FUNDS
Special Revenue Funds
Public Safety Fund
Northlake Boulevard Fund
Recreation Fund
On-Behalf Pension Contributions
THE VILLAGE OF NORTH PALM BEACH, FLORIDA
Combining Balance Sheet
Nonmajor Governmental Funds
Special Revenue Funds
Public Northlake On-Behalf Total Nonmajor
Safety Boulevard Pension Governmental
Fund Fund Recreation Contributions Funds
Assets
Cash and cash equivalents 975$ 1,986$ 88,174$ $ 91,135$
Due from other governments 52,840 52,840
Total assets 975$ 1,986$ 88,174$ 52,840$ 143,975$
Liabilities
Accounts payable $ $ $ 52,840$ 52,840$
Due to other funds 44,028 44,028
Total liabilities 44,028 52,840 96,868
Fund balances
Assigned 975 1,986 44,146 47,107
Total fund balances 975 1,986 44,146 47,107
Total liabilities and fund balances 975$ 1,986$ 88,174$ 52,840$ 143,975$
September 30, 2011
72
THE VILLAGE OF NORTH PALM BEACH, FLORIDA
Combining Statement of Revenues, Expenditures, and Changes in Fund Balances
Nonmajor Governmental Funds
For the Year Ended September 30, 2011
Special Revenue Funds
Public Northlake On-Behalf Total Nonmajor
Safety Boulevard Pension Governmental
Fund Fund Recreation Contributions Funds
Revenues
Intergovernmental 5,169$ $ $ 264,570$ 269,739$
Total revenues 5,169 264,570 269,739
Expenditures
Current
Public safety 264,570 264,570
Capital outlay 5,441 5,441
Total expenditures 5,441 264,570 270,011
Net changes in fund balances (272) (272)
Fund balances - Beginning of year 1,247 1,986 44,146 47,379
Fund balances - End of year 975$ 1,986$ 44,146$ $ 47,107$
73
FIDUCIARY FUNDS
Pension Trust Funds
Volunteer Fire Pension Trust Fund
General Employees Pension Trust Fund
Fire and Police Officers Pension Trust Fund
THE VILLAGE OF NORTH PALM BEACH, FLORIDA
Combining Statement of Net Assets - Fiduciary Funds
Fire and Total
Volunteer General Police Employee
Fire Employees Officers Retirement
Pension Pension Pension Funds
ASSETS
Cash and cash equivalents $ 233,423$ 1,080,818$ 1,314,241$
Investments:
Common equity securities 4,980,195 4,980,195
U.S. Government agencies 1,067,419 1,067,419
Municipal bonds 146,431 146,431
Corporate bonds 2,459,279 2,459,279
U.S. Treasury bonds 326,235 326,235
Equity mutual funds 4,056,958 19,302 4,076,260
Fixed income mutual funds 2,589,419 2,589,419
Accrued interest and dividends 49,550 49,550
Accounts Receivable 23,941 79,995 103,936
Prepaids 216,394 216,394
Total assets 6,903,741 10,425,618 17,329,359
LIABILITIES
Accounts payable 11,959 29,453 41,412
Total liabilities 11,959 29,453 41,412
Net Assets
Held in trust for pension benefits
and other purposes $ 6,891,782$ 10,396,165$ 17,287,947$
(1) A schedule of funding progress for the General Employees and Fire and Police Officers plans
is presented on page 64.
September 30, 2011
74
Fire and Total
Volunteer General Police Employee
Fire Employees Officers Retirement
Pension Pension Pension Funds
Additions
Contributions
Employer 1,202$ 651,159$ 641,371$ 1,293,732$
Plan members 169,948 98,656 268,604
State on-behalf payments 264,570 264,570
Total contributions 1,202 821,107 1,004,597 1,826,906
Investment earnings
Dividends and interest 2,279 34,409 288,612 325,300
Net (decrease) in fair value of investments (76,944) (465,142) (542,086)
Investment expense (62,774) (53,603) (116,377)
Total investment earnings (losses)2,279 (105,309) (230,133) (333,163)
Total additions 3,481 715,798 774,464 1,493,743
Deductions
Administration 17,985 86,692 104,677
Benefits 109,707 29,679 939,313 1,078,699
Refund of contributions 32,479 3,777 36,256
Total deductions 109,707 80,143 1,029,782 1,219,632
Change in net assets (106,226) 635,655 (255,318) 274,111
Net assets - beginning 106,226 6,256,127 10,651,483 17,013,836
Net assets - ending $ 6,891,782$ 10,396,165$ 17,287,947$
THE VILLAGE OF NORTH PALM BEACH, FLORIDA
Employee Retirement Funds
Combining Statement of Changes in Fiduciary Net Assets
For the Year Ended September 30, 2011
75
AGENCY FUNDS
Manatee Protection Agency
Northlake Boulevard Task Force
THE VILLAGE OF NORTH PALM BEACH, FLORIDA
Combining Statement of Agency Net Assets
Manatee Northlake Total
Protection Boulevard Agency
Agency Task Force Funds
Assets
Cash and cash equivalents 285,748$ 60,751$ 346,499$
Liabilities
Due to others 285,748$ 60,751$ 346,499$
Agency Funds
September 30, 2011
76
Combining Schedule of Changes in Agency Net Assets and Liabilities
October 1, 2010 Additions Deductions September 30, 2011
Manatee Protection Agency
Assets
Cash and cash equivalents 282,750$ 2,998$ $ 285,748$
Liabilities
Due to others 282,750$ 2,998$ $ 285,748$
Northlake Boulevard Task Force
Assets
Cash and cash equivalents 61,604$ 647$ 1,500$ 60,751$
Liabilities
Due to others 61,604$ 647$ 1,500$ 60,751$
Total All Agency Funds
Assets
Cash and cash equivalents 344,354$ 3,645$ 1,500$ 346,499$
Liabilities
Due to others 344,354$ 3,645$ 1,500$ 346,499$
THE VILLAGE OF NORTH PALM BEACH, FLORIDA
For the Year Ended September 30, 2011
77
PROPRIETARY FUND
(ENTERPRISE FUND)
Country Club Fund
THE VILLAGE OF NORTH PALM BEACH, FLORIDA
Schedule of Revenues and Departmental Expenses - Budget and Actual
Country Club Fund - Budgetary Basis
For the Year Ended September 30, 2011
Variance with
Final Budget
Original Final Positive Percent
Budget Budget Actual (Negative)Variance
Revenue
Greens fee/cart rentals/membership fees 2,637,170$ 2,637,170$ 2,372,337$ (264,833)$ -10.04
Golf shop revenues 218,750 218,750 283,927 65,177 29.80
Driving range revenues 200,227 200,227 208,865 8,638 4.31
Restaurant revenues 1,000,000 1,000,000 700,378 (299,622) -29.96
Interest revenues 3,500 3,500 8,493 4,993 142.66
Miscellaneous 2,325 2,325 5,692 3,367 144.82
Total revenues 4,061,972 4,061,972 3,579,692 (482,280)-11.87
Golf Maintenance
Operating expenses 1,264,727 1,264,727 1,232,462 32,265 2.55
Capital outlay 8,000 8,000 8,000 100.00
Total Golf Maintenance 1,272,727 1,272,727 1,232,462 40,265 3.16
Golf Pro Shop and Range
Personal services 424,501 460,142 470,552 (10,410) -2.26
Operating expenses 332,493 296,852 277,784 19,068 6.42
Total Golf Pro Shop and Range 756,994 756,994 748,336 8,658 1.14
Food and Beverage
Personal services 388,219 388,219 354,651 33,568 8.65
Operating expenses 536,829 536,829 483,868 52,961 9.87
Capital outlay 7,500 7,500 3,056 4,444 59.25
Total Food and Beverage 932,548 932,548 841,575 90,973 9.76
Administration
Personal services 112,479 112,479 66,860 45,619 40.56
Operating expenses 51,835 51,835 34,404 17,431 33.63
Total Administration 164,314 164,314 101,264 63,050 38.37
Clubhouse and Grounds
Operating expenses 105,180 105,180 84,485 20,695 19.68
Capital outlay 60,309 60,309 57,399 2,910 4.83
Total Clubhouse and Grounds 165,489 165,489 141,884 23,605 14.26
Insurance and General Liability
Operating expenses 79,000 79,000 40,840 38,160 48.30
Reserves
Operating 10,000 10,000 3,395 6,605 66.05
Contingency 180,699 180,699 180,699 100.00
Total Reserves 190,699 190,699 3,395 187,304 98.22
Debt service
Debt service 500,201 500,201 487,573 12,628 2.52
Total expenses on the budgetary basis 4,061,972 4,061,972 3,597,329 464,643 11.44
Revenues under expenses $ $ (17,637)$ (17,637)$
Adjustments to reconcile to the GAAP Basis
Total expenses on the budgetary basis 3,597,329
Less capital outlay costs capitalized (60,455)
Less debt service (487,573)
Add depreciation expense 457,747
Total operating expenses 3,507,048$
78
STATISTICAL SECTION
This part of the Village of North Palm Beach's comprehensive annual financial report presents detailed unaudited information as
a context for understanding what the information in the financial statement, note disclosures, and required supplementary
information says about the Village's overall financial health.
Contents Page
Financial Trends
These schedules contain trend information to help the reader understand how the Village's financial
performance and well-being have changed over time. These schedules include:
Net Assets by Component 79
Changes in Net Assets 80
Fund Balances, Governmental Funds 82
Changes in Fund Balances, Governmental Fund 83
Revenue Capacity
These schedules contain information to help the reader assess the Village's most significant local
revenue source, the property tax.
Net Assessed Value and Estimated Actual Value of Taxable Property 85
Property Tax Rates - Direct and Overlapping Governments 86
Principal Property Taxpayers 87
Property Tax Levies and Collections 88
Debt Capacity
These schedules present information to help the reader assess the affordability of the Village's
current levels of outstanding debt and the Village's ability to issue additional debt in the future.
Ratios of Outstanding Debt by Type 89
Direct and Overlapping Governmental Activities Debt 90
Pledged-Revenue Coverage 91
Demographic and Economic Information
These schedules offer demographic and economic indicators to help the reader understand the
environment within which the Village's financial activities take place.
Demographic and Economic Statistics 92
Principal Employers 93
Operating Information
These schedules contain service and infrastructure data to help understand how the information
in the Village's financial report relates to the services the Village provides and the activities it performs.
Full-Time Equivalent Village Government Employees by Function 94
Operating Indicators by Function/Program 95
Capital Asset Statistics by Function/Program 96
Sources: Unless otherwise noted, the information in these schedules is derived from the comprehensive annual
financial reports for the relevant year.
STATISTICAL SECTION
2003 2004 2005 2006 2007
Governmental Activities:
Invested in capital assets, net of related debt 3,563,142$ 3,762,961$ 3,535,596$ 8,118,773$ 10,543,788$
Restricted 613,459 470,155 19,828 154,073 113,269
Unrestricted 2,350,342 3,527,865 6,654,989 7,143,452 9,281,170
Total governmental activities net assets 6,526,943 7,760,981 10,210,413 15,416,298 19,938,227
Business-Type Activities:
Invested in capital assets, net of related debt 2,165,529 2,131,367 1,919,194 1,999,123 2,195,630
Unrestricted (65,937)(5,195)270,374 415,865 151,005
Total business-type activities net assets 2,099,592 2,126,172 2,189,568 2,414,988 2,346,635
Primary government:
Invested in capital assets, net of related debt 5,728,671 5,894,328 5,454,790 10,117,896 12,739,418
Restricted 613,459 470,155 19,828 154,073 113,269
Unrestricted 2,284,405 3,522,670 6,925,363 7,559,317 9,432,175
Total primary government net assets 8,626,535$ 9,887,153$ 12,399,981$ 17,831,286$ 22,284,862$
2008 2009 2010 2011
Governmental Activities:
Invested in capital assets, net of related debt 12,845,093$ 16,643,241$ 18,184,508$ 17,237,355$
Restricted 979,182 251,088 390,081 548,489
Unrestricted 9,836,912 11,016,626 10,568,594 11,775,621
Total governmental activities net assets 23,661,187 27,910,955 29,143,183 29,561,465
Business-Type Activities:
Invested in capital assets, net of related debt 2,492,524 2,364,814 2,295,125 2,200,927
Unrestricted 202,802 434,212 403,261 385,623
Total business-type activities net assets 2,695,326 2,799,026 2,698,386 2,586,550
Primary government:
Invested in capital assets, net of related debt 15,337,617 19,008,055 20,479,633 19,438,282
Restricted 979,182 251,088 390,081 548,489
Unrestricted 10,039,714 11,450,838 10,971,855 12,161,244
Total primary government net assets 26,356,513$ 30,709,981$ 31,841,569$ 32,148,015$
Note: Data not available prior to fiscal 2002 implementation of Governmental Accounting Standards Board Statement No. 34,
Basic Financial Statements and Management's Discussion and Analysis for State and Local Governments.
Fiscal Year
VILLAGE OF NORTH PALM BEACH
NET ASSETS BY COMPONENT
LAST TEN FISCAL YEARS
(ACCRUAL BASIS OF ACCOUNTING) Unaudited
79
VILLAGE OF NORTH PALM BEACH
CHANGES IN NET ASSETS
LAST TEN FISCAL YEARS
(ACCRUAL BASIS OF ACCOUNTING) Unaudited
Fiscal Year
2003 2004 2005 2006 2007
Expenses
Governmental activities:
General government 2,781,333$ 3,174,460$ 2,127,009$ 1,784,528$ 2,698,187$
Public safety 5,195,338 5,294,399 6,038,846 7,036,117 6,671,490
Public works 3,482,975 3,549,178 5,091,305 4,131,500 3,733,815
Community development and planning - - - 657,112 737,165
Leisure services 1,539,771 1,280,483 1,635,784 2,562,627 2,781,658
Other government - - 842,561 2,049 -
Interest on long-term debt 128,507 40,580 151,233 241,995 204,666
Total governmental activities expenses 13,127,924 13,339,100 15,886,738 16,415,928 16,826,981
Business-type activities:
Country club 2,676,883 2,567,690 2,607,712 2,124,927 3,570,683
Total business-type activities 2,676,883 2,567,690 2,607,712 2,124,927 3,570,683
Total primary government expenses 15,804,807$ 15,906,790$ 18,494,450$ 18,540,855$ 20,397,664$
Program Revenues
Governmental activities:
Charges for services:
General government 342,936$ 355,118$ 285,386$ 158,160$ 122,455$
Public safety 258,723 273,391 329,081 388,671 345,731
Public works 727,016 895,291 1,326,820 140,923 217,975
Community development and planning - - - 1,175,252 938,188
Leisure services 174,589 147,773 78,475 528,983 496,679
Other government - - - - -
Operating grants and contributions 82,134 89,362 1,392,729 998,573 170,389
Capital grants and contributions 102,560 - - 462,394 1,454,526
Total governmental activities program revenues 1,687,958 1,760,935 3,412,491 3,852,956 3,745,943
Business-type activities:
Charges for services:
Country club 2,510,258 2,548,259 2,658,468 2,167,089 3,463,524
Operating grants and contributions - - - 68,883 -
Capital grants and contributions 10,000 - - - -
Total business-type activities program revenues 2,520,258 2,548,259 2,658,468 2,235,972 3,463,524
Total primary government program revenues 4,208,216$ 4,309,194$ 6,070,959$ 6,088,928$ 7,209,467$
Net (Expense)/Revenue
Governmental activities (11,439,966)$ (11,578,165)$ (12,474,247)$ (12,562,972)$ (13,081,041)$
Business-type activities (156,625) (19,431) 50,756 111,045 (107,159)
Total primary government net expense (11,596,591)$ (11,597,596)$ (12,423,491)$ (12,451,927)$ (13,188,200)$
General revenues and other changes in net assets:
Governmental activities:
Taxes:
Property taxes 6,365,000$ 8,451,783$ 10,070,977$ 10,881,501$ 12,076,184$
Local option gas taxes - - - 307,043 292,332
Utility service taxes 1,755,153 1,830,339 1,955,403 2,001,164 2,001,443
Franchise taxes 890,285 861,708 890,297 1,150,974 1,207,552
Sales and use taxes 1,148,210 1,230,803 1,277,124 1,415,917 1,339,893
Unrestricted grants and contributions 276,302 291,710 421,254 - -
Investment earnings 75,023 53,600 196,699 477,420 650,022
Miscellaneous 54,875 92,260 111,927 53,264 8,836
Contributions for Support Our Troops - - - - 15,502
Transfers - - - 36,445 5,111
Total governmental activities 10,564,848 12,812,203 14,923,681 16,323,728 17,596,875
Business-type activities:
Investment income 4,586 3,450 12,640 112,841 43,917
Miscellaneous 99,553 42,560 - - -
Transfers - - - (36,445) (5,111)
Total business-type activities 104,139 46,010 12,640 76,396 38,806
Total primary government 10,668,987$ 12,858,213$ 14,936,321$ 16,400,124$ 17,635,681$
Change in net assets
Governmental activities (875,118)$ 1,234,038$ 2,449,434$ 3,760,756$ 4,515,834$
Business-type activities (52,486) 26,579 63,396 187,441 (68,353)
Total primary government (927,604)$ 1,260,617$ 2,512,830$ 3,948,197$ 4,447,481$
Note: Data not available prior to fiscal 2002 implementation of Governmental Accounting Standards Board Statement No. 34,
Basic Financial Statements and Management's Discussion and Analysis for State and Local Governments.
80
2008 2009 2010 2011
1,839,228$ 2,239,511$ 2,679,192$ 2,403,681$
7,154,578 7,095,043 7,304,233 7,232,748
3,996,711 4,083,441 4,594,738 4,733,913
860,448 826,149 806,536 811,177
3,244,045 3,174,623 2,830,292 2,749,065
- - - -
120,549 26,702 4,384
17,215,559 17,445,469 18,219,375 17,930,584
3,268,562 3,308,535 3,398,206 3,691,528
3,268,562 3,308,535 3,398,206 3,691,528
20,484,121$ 20,754,004$ 21,617,581$ 21,622,112$
123,334$ 122,569$ 126,968$ 130,886$
383,325 378,591 465,263 420,653
288,994 394,082 411,722 400,662
888,015 699,130 734,718 861,394
595,558 912,862 1,063,748 1,043,459
- - - -
88,224 105,080 96,670 126,568
1,602,465 2,017,158 75,845 5,169
3,969,915 4,629,472 2,974,934 2,988,791
3,616,509 3,404,859 3,227,580 3,571,199
13,609 - - -
- - - -
3,630,118 3,404,859 3,227,580 3,571,199
7,600,033$ 8,034,331$ 6,202,514$ 6,559,990$
(13,245,644)$ (12,815,997)$ (15,244,441)$ (14,941,793)$
361,556 96,324 (170,626) (120,329)
(12,884,088)$ (12,719,673)$ (15,415,067)$ (15,062,122)$
11,915,355$ 11,917,359$ 11,053,128$ 10,441,869$
278,649 267,557 266,077 259,794
2,018,071 2,239,002 2,261,375 2,198,148
1,212,562 1,256,831 1,204,328 1,191,155
1,227,341 1,116,107 1,114,945 1,140,744
- -
194,652 (1,346) 280,217 97,743
55,719 263,459 213,425 30,622
16,959 6,796
49,296
16,968,604 17,065,765 16,393,495 15,360,075
36,431 7,376 14,686 8,493
- - 55,300
(49,296)
(12,865) 7,376 69,986 8,493
16,955,739$ 17,073,141$ 16,463,481$ 15,368,568$
3,722,960$ 4,249,768$ 1,149,054$ 418,282$
348,691 103,700 (100,640) (111,836)
4,071,651$ 4,353,468$ 1,048,414$ 306,446$
81
2003 2004 2005 2006 2007
General Fund
Reserved 354,396$ 218,882$ 197,163$ 308,836$ 945,891$
Unreserved 1,654,593 2,883,855 5,771,684 7,022,606 8,179,659
Total general fund 2,008,989$ 3,102,737$ 5,968,847$ 7,331,442$ 9,125,550$
All other Governmental Funds
Reserved 613,459$ 470,155$ 19,828$ -$ -$
Unreserved, reported in:
Special revenue funds - - - 400,000 224,937
Capital projects funds - - - 397,233 673,232
Total all other governmental funds 613,459$ 470,155$ 19,828$ 797,233$ 898,169$
2008 2009
General Fund
Reserved 775,339$ 563,115$
Unreserved 8,265,513 10,058,216
Total general fund 9,040,852$ 10,621,331$
All other Governmental Funds
Reserved 239,979$ -$
Unreserved, reported in:
Special revenue funds 594,399 (152,861)
Capital projects funds 713,373 825,778
Total all other governmental funds 1,547,751$ 672,917$
2010 2011
General Fund
Nonspendable 167,108$ 276,924$
Restricted 338,457 548,489
Assigned 104,245 186,594
Unassigned 10,443,099 10,688,660
Total general fund 11,052,909$ 11,700,667$
All other Governmental Funds
Restricted $ $
Assigned
Special revenue funds 47,379 47,107
Capital projects funds 844,742 1,491,574
Total all other governmental funds 892,121$ 1,538,681$
Note: Data not available prior to fiscal 2002 implementation of Governmental Accounting Standards Board Statement No. 34,
Basic Financial Statements and Management's Discussion and Analysis for State and Local Governments.
The Village implemented GASB 54, Fund Balance Reporting and Government Fund Definitions, in 2011 and restated the 2010 amounts.
VILLAGE OF NORTH PALM BEACH
FUND BALANCES, GOVERNMENTAL FUNDS
LAST TEN FISCAL YEARS
(MODIFIED ACCRUAL BASIS OF ACCOUNTING) Unaudited
82
VILLAGE OF NORTH PALM BEACH
CHANGES IN FUND BALANCES, GOVERNMENTAL FUNDS
LAST TEN FISCAL YEARS
(MODIFIED ACCRUAL BASIS OF ACCOUNTING) Unaudited
Fiscal Year
2003 2004 2005 2006 2007
Revenues:
Taxes 9,292,822$ 11,439,823$ 13,236,952$ 14,340,682$ 15,577,511$
Licenses and Permits 686,548 712,184 1,131,903 1,128,658 880,266
Intergovernmental 1,280,228 1,350,104 2,804,985 2,914,057 2,750,021
Charges for services 665,496 719,589 647,915 1,003,660 1,082,569
Fines and forfeitures 113,391 122,407 234,513 165,496 132,158
Investment earnings 75,023 53,600 196,699 477,421 650,022
Miscellaneous 139,354 175,431 83,205 130,515 194,716
Total revenues 12,252,862 14,573,138 18,336,172 20,160,489 21,267,263
Expenditures:
General government 1,360,072 1,532,561 2,061,545 1,648,131 2,304,654
Public safety 4,758,982 5,019,361 5,713,904 6,494,578 6,609,801
Public works 3,285,603 3,280,274 5,019,739 4,708,196 3,558,264
Community development and planning 651,331 735,155
Leisure services - recreation 1,216,156 1,256,066 1,376,950 1,682,030 2,430,403
Other government 1,298,492 1,186,730 817,293 2,049
Capital outlay 2,542,819 581,938 - 1,917,377 2,737,805
Debt service
Principal payments 939,396 955,184 903,225 879,527 789,048
Interest paid on debt 136,676 40,580 151,233 199,373 207,088
Total expenditures 15,538,196 13,852,694 16,043,889 18,182,592 19,372,218
Excess of revenues over (under) expenditures (3,285,334) 720,444 2,292,283 1,977,897 1,895,045
Other financing sources (uses)
Transfers in 1,471,529 593,884
Transfers out (1,471,529) (593,884)
Capital lease
Proceeds from debt issuance 403,000 230,000 123,500
Miscellaneous (56)
Total other financing sources (uses)402,944 230,000 123,500 - -
Net change in fund balances (2,882,390)$ 950,444$ 2,415,783$ 1,977,897$ 1,895,045$
Debt service as a percentage of noncapital
expenditures 9.03%8.11%7.03%7.29%6.41%
83
2008 2009 2010 2011
15,424,638$ 15,680,749$ 14,784,906$ 14,090,966$
1,047,144 880,016 910,997 959,098
2,459,211 3,315,908 1,768,388 1,557,377
1,268,774 1,684,718 1,944,245 1,934,424
235,965 145,340 142,048 164,366
194,652 (1,345) 280,218 97,743
137,447 300,455 278,062 59,462
20,767,831 22,005,841 20,108,864 18,863,436
2,246,461 1,970,257 2,496,342 2,402,241
7,056,833 6,835,730 7,021,231 7,053,282
3,725,450 3,432,556 3,887,034 4,044,642
840,366 784,486 774,121 790,937
2,876,840 2,898,252 2,361,388 2,295,959
2,597,065 3,939,455 663,582 682,057
716,206 1,395,735 2,250,000
143,726 43,725 4,384
20,202,947 21,300,196 19,458,082 17,269,118
564,884 705,645 650,782 1,594,318
1,254,952 454,111 163,490 1,334,934
(1,254,952) (454,111) (163,490) (1,334,934)
- - - -
564,884$ 705,645$ 650,782$ 1,594,318$
4.91%8.07%11.99%
84
Unaudited
Fiscal Year
Ended
Sept 30,
Tax Role
Year
Residential
Property
Commercial
Property
Personal
Property
Total Net Market -
Assessed Value
Total Direct
Tax Rate
2002 2001 823,286,154$ 124,216,202$ 42,791,419$ 990,293,775$ 5.60
2003 2002 963,091,506 128,216,552 44,276,499 1,135,584,557 5.80
2004 2003 1,092,433,722 147,927,933 44,914,124 1,285,275,779 6.80
2005 2004 1,180,028,585 208,240,338 49,767,286 1,438,036,209 7.27
2006 2005 1,441,249,707 179,827,665 44,422,817 1,665,500,189 6.80
2007 2006 1,700,678,282 235,776,768 45,084,335 1,981,539,385 6.30
2008 2007 1,744,202,888 229,300,592 43,735,861 2,017,239,341 6.10
2009 2008 1,575,367,916 230,599,951 41,471,282 1,847,439,149 6.70
2010 2009 1,394,954,867 221,443,121 40,552,276 1,656,950,264 6.90
2011 2010 1,295,097,223 210,844,220 38,261,607 1,544,203,050 6.9723
Note: Assessed values are established by the Palm Beach Property Appraiser's office as of January 1, each year.
Assessments were increased to 100% of market value as of 1980.
Property in the Village is reassessed each year. Property is assessed at actual value, therefore the assessed
values are equal to actual value. Tax rates are per $1,000 of assessed value.
Source:Palm Beach County Property Appraiser
Real Property
VILLAGE OF NORTH PALM BEACH
NET ASSESSED VALUE AND ESTIMATED ACTUAL VALUE OF TAXABLE PROPERTY
LAST TEN FISCAL YEARS
85
Unaudited
Palm Beach Total
County Palm Special Direct and
Fiscal Tax Roll Village of School Beach Districts Overlapping
Year Year N. Palm Beach District County Rates
2002 2001 5.600 8.95 4.935 2.456 21.941
2003 2002 5.800 8.78 4.808 2.488 21.876
2004 2003 6.800 8.57 4.791 2.556 22.717
2005 2004 7.270 8.43 4.768 2.526 22.994
2006 2005 6.800 8.11 4.719 2.504 22.133
2007 2006 6.300 7.87 4.480 2.325 20.975
2008 2007 6.100 7.36 3.981 2.131 19.572
2009 2008 6.698 7.25 3.966 2.257 20.171
2010 2009 6.900 7.98 4.561 2.493 21.934
2011 2010 6.9723 8.154 4.996 2.5549 22.6772
Note:All millage rates are based on $1 for every $1,000 of assessed value.
Source:North Palm Beach: Notice of Ad Valorem Taxes and Non-Ad Valorem Assessments
(1)Overlapping rates are those of local and county governments that apply to property owners within the Village
of North Palm Beach. Not all overlapping rates apply to all Village of North Palm Beach property owners
(i.e. The rates for special districts apply only to the proportion of the government's property owners whose
property is located within the geographic boundaries of the special district.)
VILLAGE OF NORTH PALM BEACH
PROPERTY TAX RATES - DIRECT AND OVERLAPPING GOVERNMENTS
LAST TEN FISCAL YEARS
Overlapping Rates (1)
86
Unaudited
Percentage Percentage
of Total of Total
Village Net Village Net
Taxable Taxable Taxable Taxable
Assessed Assessed Assessed Assessed
Taxpayers Value Rank Value Value Rank Value
Florida Power & Light 14,537,154$ 1 0.94% $
Olen Residential Realty 14,500,000 2 0.94%17,399,486 1 1.76%
Greater Fla Inv Co &13,376,802 3 0.87%5,840,000 5 0.59%
Sanctuary Bay Trust Corporation 11,600,000 4 0.75%13,120,685 2 1.32%
Crystal Tree Property Owners, LLC 11,000,000 5 0.71%
New Country Motor Cars 10,984,628 6 0.71%
Old Port Cove Holding, Inc 8,475,000 7 0.55%
CF02 Palm Beach III LP 7,000,000 8 0.45%
Domani Development, LLC 6,884,529 9 0.45%
Village Shoppers at US 1 LLC 6,210,237 10 0.40%
Interevest Crystal Tree 9,873,474 3 1.00%
North Palm Properties, LTD 8,600,000 4 0.87%
Transcontinental Atrium, Inc.4,590,000 6 0.46%
Roschman, M. Elaine TR 4,100,000 7 0.41%
WCI Communities, Inc 4,009,300 8 0.40%
Pavilion Office Center 3,240,000 9 0.33%
Old Port Cove Dev.3,118,107 10 0.31%
Total 104,568,350$ 6.77%73,891,052$ 7.45%
Source: Palm Beach Country Appraiser
Note: Assessed values are established by the Palm Beach Property Appraiser's offices as of January 1, each year.
20022011
VILLAGE OF NORTH PALM BEACH
PRINCIPAL PROPERTY TAXPAYERS
CURRENT YEAR AND 2002
87
Unaudited
Fiscal Year Total Taxes Collections in
Ending Tax Roll Levied for Percent Subsequent Percent
Sept 30,Year Fiscal Year Amount of Levy Years Amount of Levy
2002 2001 5,562,239 5,357,206 96.31%12,175 5,369,381 96.53%
2003 2002 6,597,909 6,359,478 96.39%5,522 6,365,000 96.47%
2004 2003 8,825,061 8,441,383 95.65%10,401 8,451,784 95.77%
2005 2004 10,463,873 10,059,478 96.14%9,476 10,068,954 96.23%
2006 2005 11,329,648 10,690,869 94.36%172,744 10,863,613 95.89%
2007 2006 12,624,307 11,802,457 93.49%228,352 12,030,809 95.30%
2008 2007 12,360,135 11,546,732 93.42%333,756 11,880,488 96.12%
2009 2008 12,401,519 11,530,384 92.98%349,642 11,880,026 95.79%
2010 2009 11,564,281 10,683,829 92.39%284,004 10,967,833 94.84%
2011 2010 10,793,319 10,097,289 93.55%298,514 10,395,803 96.32%
Source:Palm Beach Country Property Appraiser
*Information presented is preliminary due to county software upgrade problems.
of the Levy to Date
Total Collections
Collected within
VILLAGE OF NORTH PALM BEACH
PROPERTY TAX LEVIES AND COLLECTIONS
LAST TEN CALENDAR YEARS
the Fiscal Year
88
VILLAGE OF NORTH PALM BEACH
RATIOS OF OUTSTANDING DEBT BY TYPE
LAST TEN FISCAL YEARS
Unaudited
Business-type
Activities
Fiscal Year Percent of
Ended Loans Capital Loans Capital Median Personal Per
Sept 30,Payable Leases Payable Leases Total Income (1)Capita (1)
2002 7,334,853 736,967 651,058 8,722,878 N/A 715.11
2003 6,947,633 587,792 513,472 8,048,897 N/A 659.85
2004 6,376,387 433,855 411,573 7,221,815 N/A 592.05
2005 5,754,677 275,840 454,131 6,484,648 N/A 513.31
2006 4,941,765 209,224 5,185,978 10,336,967 17.20%786.20
2007 4,280,842 81,100 5,026,895 9,388,837 14.67%715.61
2008 3,605,639 40,097 4,662,833 192,892 8,501,461 12.92%692.64
2009 2,250,000 - 4,383,033 97,049 6,730,082 10.14%583.15
2010 - - 4,090,284 235,176 4,325,460 6.74%371.64
2011 - - 3,844,928 173,084 4,018,012 *6.26%**345.22
Note:Details regarding the Village's outstanding debt may be found in the notes to the
financial statements.
*2010 Median Household Income was used for calculation - 2011 Income was not available due to agency software upgrades
**2010 Population was used for calculation - 2011's Population was not available due to agency software upgrades
(1)See the Schedule of Demographic and Economic Statistics on page 92 for personal income and population data.
N/A Data not available.
Governmental Activities
89
Percentage Amount
Net Applicable to Applicable to
Debt the Village of the Village of
Outstanding North Palm Beach (1) North Palm Beach
Debt repaid with property taxes:
Palm Beach County 226,545,000$ 1.22%2,763,849$
Palm Beach County School Board 1.15%
Other debt:
Palm Beach County 884,215,000 1.22%10,787,423
Palm Beach County School Board 37,215,000 1.15%427,973
Subtotal, overlapping debt 13,979,245
Village of North Palm Beach Direct Debt 100%-
Total direct and overlapping debt 13,979,245$
Sources:Palm Beach County Tax Appraiser's Office
Palm Beach County School Board
Palm Beach County Clerk & Comptroller
Note: Overlapping governments are those that coincide, at least in part, with the geographic boundaries
of the Village. This schedule estimates the portion of the outstanding debt of those overlapping
governments that is borne by the residents and businesses of the Village of North Palm Beach. This
process recognizes that, when considering the Village's ability to issue and repay long-term debt, the
entire debt burden borne by the residents and businesses should be taken into account. However,
this does not imply that every taxpayer is a resident, and therefore responsible for repaying the debt,
of each overlapping government.
(1)For debt repaid with property taxes, the percentage of overlapping debt applicable is estimated using
taxable assessed property values. Value that is within the Village's boundaries and dividing it by the
County's and School Board's total taxable assessed value. This approach was also used for the other
debt.
Government Unit
VILLAGE OF NORTH PALM BEACH
DIRECT AND OVERLAPPING GOVERNMENTAL ACTIVITIES DEBT
SEPTEMBER 30, 2011
Unaudited
90
VILLAGE OF NORTH PALM BEACH
Pledged - Revenue Coverage
Country Club Bonds
Last Ten Fiscal Years
Unaudited
Required
Fiscal Gross Operating Debt
Year Revenues (1) Expenses (2)Net Revenue Service Coverage (3)
(4)
2006 2,348,813$ 1,910,640$ 438,173$ 106,936$ 4.10 (4)
2007 3,507,441 2,991,621 515,820 392,505 1.31
2008 3,652,940 2,558,591 1,094,349 394,900 2.77
2009 3,412,235 2,587,171 825,064 394,900 2.09
2010 3,242,266 2,728,470 513,796 394,900 1.30
2011 3,579,692 3,049,301 530,391 394,900 1.34
(1)Gross revenue includes interest revenue.
(2)Operating expenses excludes depreciation.
(3)Coverage should be not less than 1.00.
(4)2006 was the first year the debt was outstanding, and was not a complete year.
91
Per Palm Beach
Median Capita County
Calendar Personal Personal Unemployment
Year Population (1)Income (1)Income (1)Rate (2)
2002 12,198 - - 6.1
2003 12,198 - - 5.6
2004 12,198 - - 5.0
2005 12,633 - - 4.0
2006 (estimate)13,148 60,101 46,726 3.3
2007 (estimate)13,120 63,984 42,224 4.1
2008 (estimate)12,274 65,815 45,563 6.3
2009 (estimate)11,541 66,401 49,350 10.8
2010 (estimate)11,639 64,156 49,130 12.0
2011 (estimate)***10.7
Sources:Business Development Board
US Census Bureau
*2011 Demographic data is not available due to Agency Software upgrade
that is not complete
Note: (1)All information available at the current time is presented.
(2)North Palm Beach is not large enough to track unemployment rates.
Palm Beach County rates are presented.
VILLAGE OF NORTH PALM BEACH
DEMOGRAPHIC AND ECONOMIC STATISTICS
LAST TEN CALENDAR YEARS
Unaudited
92
Unaudited
Percentage Percentage
of Total of Total
Employer Employees Employment Employees Employment
Palm Beach Country School Board 21,495 3.47%Palm Beach Country School Board 18,677 3.21%
Palm Beach County Government 11,381 1.84%Palm Beach County Government 9,000 1.55%
State Government 9,200 1.49%State Government 8,705 1.50%
Federal Government 6,200 1.00%Federal Government 5,660 0.97%
Tenet Health Care Corp (2)6,100 0.99%HCA - Hospital Corp. of America (1)4,000 0.69%
Florida Power & Light Company 3,632 0.59%Intracoastal Health Systems, Inc (2)3,040 0.52%
G4S Headquarters 3,000 0.48%U.S. Sugar Corporation 3,000 0.52%
HCA - Hospital Corp. of America (1)2,714 0.44%Florida Power & Light Company 2,800 0.48%
Florida Alantic University 2,706 0.44%Boca Raton Resort & Club (Hotel)2,380 0.41%
Bethesda Memorial Hospital 2,391 0.39%Florida Crystals 2,000 0.34%
Total 68,819 11.13%Total 59,262 10.19%
Source:Business Development Board of Palm Beach County
*Employer: Palm Beach County
Information is not available for the Village of North Palm Beach.
**Percentage of total employment is calculated using Palm Beach County's
available labor force in each of the respective years presented.
Notes:
(1)Formerly Columbia Palm Beach Health Care Systems, Inc
(2)Intracoastal Health Systems, Inc - now part of Tenet Healthcare Corp
VILLAGE OF NORTH PALM BEACH
PRINCIPAL EMPLOYERS
CURRENT YEAR AND NINE YEARS AGO
2011 2002
93
2002 2003 2004 2005 2006 2007 2008 2009 2010 2011
Number of Employees:
General Government
Village Manager - Full-Time 1 1 1 1 1 1 1 1 1 1
Assistant Village Manager - Full-Time 1 1 1 1 0 0 0 0 0 0
Systems Specialist
Full-Time 1 1 1 1 2 2 2 2 2 2
Part-Time 0 0 0 0 0 0 0 1 1 1
Executive Secretary - Full-Time 1 1 1 1 1 1 1 1 1 1
Human Resources 2 2 2 2 2 2
Village Clerk - Full-Time 2 3 3 3 3 3 3 3 3 3
Finance
Full-time 5 5 5 5 5 5 5 5 5 5
Part-Time 0 0 0 0 0 0 1 1 1 1
Public Works
Full-time 61 61 61 62 54 47 48 38 37 37
Part-Time 4 8 8 6 3 0 0 0 0 0
Public Safety
Full-time 63 66 66 61 66 68 68 67 67 67
Part-Time 12 14 14 15 14 13 12 11 12 12
Community Development and Planning
Full-time 0 0 0 0 0 9 10 9 9 9
Part-Time 0 0 0 0 0 1 1 2 2 2
Leisure Services
Library
Full-time 9 9 9 8 7 7 7 6 6 6
Part-Time 8 7 7 7 8 8 8 10 10 10
Recreation
Full-time 5 6 6 5 15 15 17 9 7 6
Part-Time 14 14 14 15 31 39 42 42 42 43
Other Government - Country Club
Full-time 24 25 25 24 18 19 18 5 5 7
Part-Time 36 27 27 27 24 25 22 21 21 64
Total Number of Employees Budgeted FY Ending 247 249 249 242 254 265 268 236 234 279
* Variance exists due to the employment of seasonal and part-time employees.
Source:Village of North Palm Beach Budget Report
VILLAGE OF NORTH PALM BEACH
Unaudited
LAST TEN FISCAL YEARS (*)
Full-Time Equivalent Village Government Employees by Function
94
2002 2003 2004 2005 2006 2007 2008 2009 2010 2011
FUNCTION/PROGRAM
GENERAL GOVERNMENT
Number of Parcels - - - - - 7,411 7,422 7,472 7,466 7,466
PUBLIC WORKS
Street Maintenance (No. of lane miles maintained)31.155 31.155 31.155 31.155 31.155 31 31 31 31 31
Sanitation (Tons of Refuse Collected)12,996 13,136 18,842 14,037 13,203 12,085 11,974 10,667 10,165 9,962
No. of collection units for solid waste (residential) 7,328 7,434 7,470 7,519 7,558 7,152 7,163 7,214 7,070 7,071
Number of vehicles maintained 95 95 95 95 95 104 104 110 110 98
Number of repair overlays completed (miles)2.840 3.787 5.587 2.462 2.935 2 3 2.5 2.71 -
PUBLIC SAFETY
Number of arrests by police officers 246 320 315 331 410 545 549 448 402 260
Number of traffic citations issued 3,936 2,564 3,110 5,743 4,272 4,269 5,520 6,305 4,951 2,564
EMS average response times (minutes)3.33 2.94 4.42 3.98 4.69 4.73 5.17 5.01 5.12 5.19
Number of EMS calls 853 922 1,066 965 1,056 1,034 1,114 1,214 1,146 1,179
COMMUNITY DEVELOPMENT & PLANNING
Building Department - Number of Permits 205 224 201 201 (1)1,875 1,619 1,548 1,744 1,616
Number of code enforcement violations - - - - 1,767 1,617 729 613 391 575
Number of code violations brought to board/magistrate
(Calendar Yr End)101 120 145 165 144 126 115 73 38 72
RECREATION
Number of community events presented 13 14 15 22 21 24 23 28 28 38
Number of registrants in athletic programs 2,185 1,750 1,575 1,400 1,520 1,600 1,400 1,125 1,005 1,260
LIBRARY
Library - Number of Volumes 47,339 47,960 47,531 54,074 47,371 42,372 33,122 35,681 39,277 40,658
OTHER GOVERNMENT
Country Club
Number of Golf Members - - - - 365 579 389 297 354 298
Number of Tennis Members - - - - 136 171 171 180 184 173
(1)An accurate number of building permits issued for 2006 is not available - computer systems crash.
Source: Village of North Palm Beach
U.S. Census Bureau
VILLAGE OF NORTH PALM BEACH
OPERATING INDICATORS BY FUNCTION/PROGRAM
LAST TEN FISCAL YEARS
Unaudited
95
2002 2003 2004 2005 2006 2007 2008 2009 2010 2011
Function/Program:
General Government
No. of General Government Buildings 11 11 11 11 11 11 11 23 23 23
Public Works
Square Miles 5.18 5.18 5.18 5.18 5.18 5.18 5.18 5.18 5.18 5.18
Miles of Streets 36.00 36.00 36.00 36.00 36.00 36.00 36.00 36.00 36.00 36.00
Number of Street Lights 425 425 425 425 425 425 513 513 513 513
Public Safety
Fire:
Number of Stations 1 1 1 1 1 1 1 1 1 1
Number of Fireman & Officers 8 8 8 8 0 0 0 0 0 0
Number of Firemen/Paramedics/EMTs 0 0 0 0 23 23 23 23 23 23
Police/EMS Protection:
Number of Stations 2 1 1 1 1 1 1 1 1 1
Number of Policemen & Officers 33 35 35 35 33 32 32 31 31 31
EMS Protection 13 13 13 13 0 0 0 0 0 0
Leisure Services
Recreation
Number of Parks 4 4 4 4 4 4 4 4 4 4
Public Tennis Courts 4 4 4 4 2 2 2 2 2 2
Swimming Pool 1 1 1 1 1 1 1 1 1 1
Number of Marinas 1 1 1 1 1 1 1 1 1 1
Library
Number of Libraries 1 1 1 1 1 1 1 1 1 1
Number of Volumes 47,339 47,960 47,531 54,074 47,371 42,372 33,122 35,681 39,277 40,658
Other Government
Country Club
Golf Course 1 1 1 1 1 1 1 1 1 1
Driving Range 1 1 1 1 1 1 1 1 1 1
Tennis Courts 10 10 10 10 10 10 10 10 10 10
Restaurant/Sanck Bar - - - - - - - - 1 1
Source: Village of North Palm Beach
VILLAGE OF NORTH PALM BEACH
LAST TEN FISCAL YEARS
Unaudited
CAPITAL ASSET STATISTICS BY FUNCTION/PROGRAM
96
OTHER REPORTS
97
REPORT ON INTERNAL CONTROL OVER
FINANCIAL REPORTING AND ON COMPLIANCE
AND OTHER MATTERS BASED ON AN
AUDIT OF FINANCIAL STATEMENTS
PERFORMED IN ACCORDANCE WITH
GOVERNMENT AUDITING STANDARDS
The Honorable Mayor and Members of the Village Council
North Palm Beach, Florida
We have audited the financial statements of the governmental activities, the business-type
activities, each major fund, and the aggregate remaining fund information of the Village of North
Palm Beach, Florida, as of and for the year ended September 30, 2011, which collectively
comprise the Village of North Palm Beach, Florida’s basic financial statements and have issued
our report thereon dated March 13, 2012. We conducted our audit in accordance with U.S.
generally accepted auditing standards and the standards applicable to financial audits contained
in Government Auditing Standards, issued by the Comptroller General of the United States.
Internal Control Over Financial Reporting
In planning and performing our audit, we considered the Village of North Palm Beach, Florida’s
internal control over financial reporting as a basis for designing our auditing procedures for the
purpose of expressing our opinions on the financial statements, but not for the purpose of
expressing an opinion on the effectiveness of the Village of North Palm Beach, Florida’s internal
control over financial reporting. Accordingly, we do not express an opinion on the effectiveness
of the Village of North Palm Beach, Florida’s internal control over financial reporting.
A deficiency in internal control exists when the design or operation of a control does not allow
management or employees, in the normal course of performing their assigned functions, to
prevent, or detect and correct misstatements on a timely basis. A material weakness is a
deficiency, or a combination of deficiencies, in internal control such that there is a reasonable
possibility that a material misstatement of the entity’s financial statements will not be prevented,
or detected and corrected on a timely basis.
98
Our consideration of internal control over financial reporting was for the limited purpose
described in the first paragraph of this section and was not designed to identify all deficiencies in
internal control over financial reporting that might be deficiencies, significant deficiencies, or
material weaknesses. We did not identify any deficiencies in internal control over financial
reporting that we consider to be material weaknesses, as defined above.
Compliance and Other Matters
As part of obtaining reasonable assurance about whether Village of North Palm Beach, Florida’s
financial statements are free of material misstatement, we performed tests of its compliance with
certain provisions of laws, regulations, contracts, and grant agreements, noncompliance with
which could have a direct and material effect on the determination of financial statement
amounts. However, providing an opinion on compliance with those provisions was not an
objective of our audit, and accordingly, we do not express such an opinion. The results of our
tests disclosed no instances of noncompliance or other matters that are required to be reported
under Government Auditing Standards.
We noted certain matters that we reported to the management of the Village of North Palm Beach,
Florida in the attached Management Letter dated March 13, 2012.
This report is intended solely for the information and use of management, the audit committee,
Village Council, and federal and state awarding agencies and pass-through entities and is not
intended to be and should not be used by anyone other than these specified parties.
March 13, 2012
West Palm Beach, Florida
99
MANAGEMENT LETTER
The Honorable Mayor and Members of the Village Council
Village of North Palm Beach, Florida
We have audited the financial statements of the Village of North Palm Beach, Florida, as of and for
the year ended September 30, 2011, and have issued our report thereon dated March 13, 2012.
We conducted our audit in accordance with U.S. generally accepted auditing standards, and the
standards applicable to financial audits contained in Government Auditing Standards issued by the
Comptroller General of the United States. We have issued our Independent Auditor’s Report on
Internal Control over Financial Reporting and on Compliance and Other Matters Based on an
Audit of Financial Statements Performed in Accordance with Government Auditing Standards.
Disclosures in that report, which is dated March 13, 2012, should be considered in conjunction
with this management letter.
Additionally, our audit was conducted in accordance with Chapter 10.550, Rules of the Auditor
General, which governs the conduct of local governmental entity audits performed in the State of
Florida. This letter includes the following information, which is not included in the aforementioned
auditor’s report.
PRIOR YEAR COMMENTS
The Rules of the Auditor General require that we address in the management letter whether
or not recommendations made in the preceding annual financial audit report have been
followed. All prior year recommendations have been implemented.
CURRENT YEAR COMMENTS
The Rules of the Auditor General require that we address in the management letter any
recommendations to improve financial management. In connection with our audit for the
fiscal year ended September 30, 2011, we did not have any such recommendations.
100
Investment of Public Funds
Rules of the Auditor General require our audit to include a review of the Village’s
compliance with Section 218.415, Florida Statutes, regarding the investment of public
funds. In connection with our audit for the fiscal year ended September 30, 2011, the
results of our procedures did not disclose any instances of noncompliance with Section
218.415, Florida Statutes.
Violations of Contracts and Grant Provisions or Abuse
Rules of the Auditor General require that we address violations of provisions of contracts
or grant agreements or abuse that have occurred, or are likely to have occurred, that have an
effect on the financial statements that is less than material but more than inconsequential.
In connection with our audit for the fiscal year ended September 30, 2011, we did not have
any such findings.
Matters Inconsequential to the Financial Statements
Rules of the Auditor General provide that the auditor may, based on professional judgment,
report the following matters that have an inconsequential effect on the financial statements,
considering both quantitative and qualitative factors: (1) violations provisions of contracts
or grant agreements, fraud, illegal acts, or abuse; and (2) deficiencies in internal control that
are not significant deficiencies. In connection with our audit for the fiscal year ended
September 30, 2011, we did not have any such findings.
Oversight Unit and Component Units
The Village of North Palm Beach, Florida, is a municipal corporation incorporated in 1956
pursuant to Chapter 31481, Laws of Florida, Extraordinary Session 1956. Based upon the
application of criteria defined in publications cited in Chapter 10.553, Rules of the Auditor
General, the Village has determined that there are no component units related to the Village.
Consideration of Financial Emergency Criteria
Rules of the Auditor General require a statement be included as to whether or not the local
government entity has met one or more of the conditions described in Section 218.503(1),
Florida Statutes, and identification of the specific condition(s) met. In connection with our
audit, the results of our procedures did not disclose that the Village of North Palm Beach,
Florida has met any of the conditions described in Section 218.503(1) during the fiscal year
ended September 30, 2011.
Annual Financial Report
Rules of the Auditor General require that we determine whether the annual financial report
for the Village of North Palm Beach, Florida for the fiscal year ended September 30, 2011,
filed with the Florida Department of Financial Services pursuant to Section 218.32(1)(a),
Florida Statutes, is in agreement with the annual financial audit report for the fiscal year
101
ended September 30, 2011. In connection with our audit, we noted that the two reports
were in substantial agreement.
Financial Condition Assessment Procedures
Pursuant to Rules of the Auditor General, we applied financial condition assessment
procedures as of September 30, 2011. It is management’s responsibility to monitor the
Village’s financial condition, and our financial condition assessment was based in part on
representations made by management and the review of financial information provide by
management. The results of our procedures did not disclose any matters that are required
to be reported.
Excess of Expenditures Over Appropriations
There were no departments that had expenditures in excess of appropriations.
Pursuant to Chapter 119, Florida Statutes, this management letter is a public record and its
distribution is not limited. Auditing standards generally accepted in the United States of America
require us to indicate that this letter is intended solely for the information and use of management,
the audit committee, Village Council, federal and state awarding agencies and pass-through
entities, and the Florida Auditor General, and is not intended to be and should not be used by
anyone other than these specified parties.
March 13, 2012
West Palm Beach, Florida