HomeMy WebLinkAboutFinancial Reports-Comprehensive Annual Financial Report (CAFR) - 6/30/2016Town of Oro Valley, Arizona
COMPREHENSIVE ANNUAL
FINANCIAL REPORT
For the Fiscal Year Ended June 30, 2016
TOWN OF ORO VALLEY, ARIZONA
COMPREHENSIVE ANNUAL FINANCIAL REPORT
FOR THE FISCAL YEAR ENDED JUNE 30, 2016
________________________________________________________________________________
11000 North La Canada Drive – Oro Valley, Arizona 85737-7015
TOWN OF ORO VALLEY, ARIZONA
COMPREHENSIVE ANNUAL FINANCIAL REPORT
FOR THE FISCAL YEAR ENDED JUNE 30, 2016
Prepared by:
Finance Department
Stacey Lemos, CPA
Finance Director
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TOWN OF ORO VALLEY, ARIZONA
COMPREHENSIVE ANNUAL FINANCIAL REPORT
FOR THE FISCAL YEAR ENDED JUNE 30, 2016
TABLE OF CONTENTS
INTRODUCTORY SECTION Page
Letter of Transmittal 1
Organization Chart 9
List of Town Officials 10
GFOA Certificate of Achievement 11
FINANCIAL SECTION
INDEPENDENT AUDITOR’S REPORT 17
MANAGEMENT’S DISCUSSION AND ANALYSIS (MD&A) 21
BASIC FINANCIAL STATEMENTS
Government-Wide Financial Statements:
Statement of Net Position 35
Statement of Activities 36
Fund Financial Statements:
Balance Sheet – Governmental Funds 40
Reconciliation of the Balance Sheet –
Governmental Funds to the Statement of Net Position 43
Statement of Revenues, Expenditures and Changes in Fund Balances –
Governmental Funds 44
Reconciliation of the Statement of Revenues, Expenditures and
Changes in Fund Balances – Governmental Funds to the
Statement of Activities 47
Statement of Net Position – Proprietary Funds 48
TOWN OF ORO VALLEY, ARIZONA
COMPREHENSIVE ANNUAL FINANCIAL REPORT
FOR THE FISCAL YEAR ENDED JUNE 30, 2016
TABLE OF CONTENTS
FINANCIAL SECTION Page
BASIC FINANCIAL STATEMENTS
Statement of Revenues, Expenses and Changes in Fund Net Position –
Proprietary Funds 50
Statement of Cash Flows – Proprietary Funds 52
Notes to Financial Statements 53
REQUIRED SUPPLEMENTARY INFORMATION
Schedule of Revenues Expenditures and Changes in Fund Balances –
Budget and Actual:
General Fund 92
Community Center Fund 93
Schedule of Proportionate Share of the Net Pension Liability 94
Schedules of Changes in the Net Pension Liability and Related Ratios 95
Schedule of Contributions 97
Schedule of Funding Progress 98
Notes to Required Supplementary Information 99
COMBINING AND INDIVIDUAL FUND FINANCIAL STATEMENTS AND
SCHEDULES
Governmental Funds:
Combining Balance Sheet – All Non-Major Governmental Funds
By Fund Type 104
Combining Statement of Revenues, Expenditures and Changes in
Fund Balances – All Non-Major Governmental Funds – By Fund Type 106
TOWN OF ORO VALLEY, ARIZONA
COMPREHENSIVE ANNUAL FINANCIAL REPORT
FOR THE FISCAL YEAR ENDED JUNE 30, 2016
TABLE OF CONTENTS
FINANCIAL SECTION Page
COMBINING AND INDIVIDUAL FUND FINANCIAL STATEMENTS AND
SCHEDULES
Special Revenue Funds:
Combining Balance Sheet 110
Combining Statement of Revenues, Expenditures and
Changes in Fund Balances 112
Combining Schedule of Revenues, Expenditures and
Changes in Fund Balances – Budget and Actual 114
Debt Service Fund:
Combining Balance Sheet 120
Combining Statement of Revenues, Expenditures and
Changes in Fund Balances 121
Combining Schedule of Revenues, Expenditures and Changes in
Fund Balance – Budget and Actual 122
Capital Projects Funds:
Combining Balance Sheet 126
Combining Statement of Revenues, Expenditures and
Changes in Fund Balances 128
Combining Schedule of Revenues, Expenditures and
Changes in Fund Balances – Budget and Actual 130
Internal Service Funds:
Combining Statement of Net Position 136
Combining Statement of Revenues, Expenses and
Changes in Fund Net Position 137
Combining Statement of Cash Flows 138
TOWN OF ORO VALLEY, ARIZONA
COMPREHENSIVE ANNUAL FINANCIAL REPORT
FOR THE FISCAL YEAR ENDED JUNE 30, 2016
TABLE OF CONTENTS
STATISTICAL SECTION
Financial Trends:
Net Position by Component 141
Changes in Net Position 142
Fund Balances of Governmental Funds 145
Changes in Fund Balances of Governmental Funds 146
Revenue Capacity:
Principal Employers 147
Principal Sales Taxpayers 148
Taxable Sales by Category 149
Direct and Overlapping Sales Tax Rates 150
Limited and Full Cash Assessed Property Values 151
Historical and Projected Excise Tax Collections 152
Debt Capacity:
Ratio of Outstanding Debt by Type 153
Direct and Overlapping Governmental Activities Debt 154
Legal Debt Margin Information 155
Calculation of Legal Debt Margin 156
Pledged-Revenue Coverage 156
Historical and Projected Water System Revenues, Expenses,
Debt Service and Coverage 158
Demographic and Economic Information:
Demographic and Economic Statistics 159
TOWN OF ORO VALLEY, ARIZONA
COMPREHENSIVE ANNUAL FINANCIAL REPORT
FOR THE FISCAL YEAR ENDED JUNE 30, 2016
TABLE OF CONTENTS
STATISTICAL SECTION Page
Operating Information:
Full-Time Equivalent Town Employees by Function 160
Water Utility Revenues by User Type 161
Operating Indicators by Function 162
Water Rates 163
Capital Assets Statistics by Function 164
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INTRODUCTORY SECTION
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Caring for our heritage, our community, our future.
www.orovalleyaz.gov
11000 N. La Cañada Drive • Oro Valley, Arizona 85737
phone: (520) 229-4700 • fax: (520) 229-0428
Town of Oro Valley
November 18, 2016
Honorable Mayor, Members of Town Council and
Citizens of the Town of Oro Valley, Arizona:
State law mandates that cities publish a complete set of financial statements presented in conformity
with accounting principles generally accepted in the United States of America and audited in
accordance with auditing standards generally accepted in the United States of America by a certified
public accounting firm licensed in the State of Arizona. Pursuant to that requirement, we hereby issue
the comprehensive annual financial report of the Town of Oro Valley, Arizona (Town) for the fiscal
year ended June 30, 2016.
This report consists of management’s representations concerning the finances of the Town.
Consequently, management assumes full responsibility for the completeness and reliability of all of
the information presented in this report. To provide a reasonable basis for making these
representations, management of the Town has established a comprehensive internal control framework
that is designed both to protect the Town’s assets from loss, theft, or misuse and to compile sufficient
reliable information for the preparation of the Town’s financial statements in conformity with
accounting principles generally accepted in the United States of America. Because the cost of internal
controls should not outweigh their benefits, the Town’s comprehensive framework of internal controls
has been designed to provide reasonable rather than absolute assurance that the financial statements
will be free of material misstatement. As management, we assert that, to the best of our knowledge
and belief, this financial report is complete and reliable in all material respects.
The Town’s financial statements have been audited by Heinfeld, Meech & Co., P.C., a certified public
accounting firm. The goal of the independent audit was to provide reasonable assurance that the
financial statements of the Town for the fiscal year ended June 30, 2016, are free of material
misstatement. The independent audit involved examining, on a test basis, evidence supporting the
amounts and disclosures in the financial statements; assessing the accounting principles used and
significant estimates made by management; and evaluating the overall financial statement presentation.
The independent auditors concluded, based upon the audit, that there was a reasonable basis for
rendering an unmodified opinion that the Town’s financial statements for the fiscal year ended
June 30, 2016, are fairly presented in conformity with accounting principles generally accepted in the
United States of America. The independent auditor’s report is presented as the first component of the
financial section of this report.
The independent audit of the financial statements of the Town was part of a broader, federally
mandated Single Audit as required by the provisions of the Single Audit Act Amendments of 1996 and
the audit requirements of Title 2 U.S. Code of Federal Regulations (CFR) Part 200, Uniform
Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards (Uniform
Guidance). The standards governing Single Audit engagements require the independent auditor to
report not only on the fair presentation of the financial statements, but also on the Town’s internal
controls and compliance with legal requirements, with special emphasis on internal controls and legal
requirements involving the administration of federal awards. These reports are available in a separately
issued Single Audit Reporting Package.
Accounting principles generally accepted in the United States of America require that management
provide a narrative introduction, overview, and analysis to accompany the basic financial statements
in the form of Management’s Discussion and Analysis (MD&A). This letter of transmittal is designed
to complement the MD&A and should be read in conjunction with it. The Town of Oro Valley’s
MD&A can be found immediately following the report of the independent auditors.
PROFILE OF THE TOWN
The Town of Oro Valley was incorporated in 1974. It is located in northeastern Pima County, three
miles north of Tucson and sits at an elevation of 2,620 feet. The Town currently occupies a land area
of more than 36 square miles and serves an estimated population of 43,565. The population of Oro
Valley has increased 47% since the 2000 population of 29,700.
Based on the 2010 Census data, Oro Valley has a median household income of $71,628, compared to
the median household income for the state of Arizona of $50,296. Oro Valley residents enjoy a
comfortable hometown feel with a strong family orientation, excellent education system and abundant
opportunities in a safe environment.
The Town of Oro Valley operates under the Council-Manager form of government. Policymaking and
legislative authority is vested in the Town Council, which consists of a Mayor and six
Councilmembers. Councilmembers are elected to four-year staggered terms. The citizens of Oro Valley
elect the Mayor. The Council, from among its members, selects the Vice-Mayor. The Town Council
is responsible, among other things, for the adoption of local ordinances, budget adoption, the
development of citizen advisory committees, the hiring and removal of the Town Manager, the Police
Chief, Town Attorney and Town Magistrate. The Town Manager is responsible for implementation
of the policies of the Town Council. The Town Manager appoints all other department directors except
those mentioned above under Town Council responsibilities.
The Town of Oro Valley provides a full range of services including police protection; the construction
and maintenance of streets and related infrastructure; the provision of water and stormwater services;
public transportation services; recreational activities and cultural events. In addition to general
government activities, the governing body is financially accountable for the Municipal Property
Corporation; therefore, this activity is included in the reporting entity. Additional information in
regards to the Municipal Property Corporation can be found in Note 1 in the notes to the basic financial
statements.
As with all cities in the State of Arizona, the Town of Oro Valley is required to comply with Article
IX, Section 20 (1) of the Arizona Constitution, which sets limits on the Town’s legal budget capacity.
The Town currently operates under the Alternative Expenditure Limitation – Home Rule Option. This
option allows the Town Council to establish the budgetary limits locally, rather than being restricted
by the State-imposed expenditure limitation. The voters must authorize this option every four years.
It was last authorized by the citizens of Oro Valley in August of 2014.
The annual operating budget serves as the foundation for the Town’s financial planning and control.
The objective of these budgetary controls is to ensure compliance with legal provisions embodied in
the annual operating budget approved by the Town Council. The Town’s proposed operating budget
is presented to the Town Council for review throughout the budget cycle starting in December and
approved in June. The Town Council is required to hold a public hearing on the proposed budget and
to adopt the final budget by no later than the second Monday in August. Budget amendments requiring
the approval of the Town Council include the following: budget transfers between funds; transfers to
fund additional personnel or increased expenditures as a result of personnel reclassifications; transfers
that would reduce or eliminate funding for items designated in the adopted Capital Improvement Plan;
and transfers that would reduce or eliminate funding for debt service. All other operational budget
amendments that involve transfers between line items or expenditure categories require approval by
the Town Manager.
MAJOR INITIATIVES AND ACCOMPLISHMENTS FOR THE YEAR
Oro Valley’s Strategic Plan was updated during FY 2014-15 and is centered around the vision
expressed in the Council-adopted and voter-ratified Oro Valley General Plan. While the Strategic Plan
guides short-term decision-making, the General Plan provides a longer term (up to 10 years) direction
regarding the growth, development and redevelopment of the community. Oro Valley is a community
defined by the highest standard of environmental integrity, education, infrastructure, services and
public safety. It is a community of people working together to create the Town’s future with a
government that is responsive to residents and ensures the long-term financial stability of the Town.
The five main focus areas in the Strategic Plan are listed below. Also shown below are the Town’s
accomplishments in these areas during FY 2015-16.
Fiscal Responsibility
The Town Council and management are focused on efforts to maintain long-term
financial health through diversified revenue sources while strategically investing in
community initiatives.
o Approved a balanced budget for FY 2016-17
o Issued 1,990 permits, including 60 commercial building permits, 367 residential
building permits, 46 grading permits, 1,168 miscellaneous building permits, 150 sign
permits, 105 pool permits, and 21 model home plans
o Continued use of Arizona Dept. of Corrections (ADC) crews to perform landscape
and parks maintenance and minor repairs on small fleet equipment at significant cost
savings to the Town
o Completed refunding of Series 2005 Excise Tax Revenue Obligations resulting in
overall net interest savings of nearly $340,000
o Implemented a new payment vendor for the Magistrate Court, which collected an
additional $58,000 in court fines and fees owed
o Received Certificate of Achievement for Financial Reporting Excellence,
Distinguished Budget Presentation Award and Popular Annual Financial Reporting
Award from Government Finance Officers Association (GFOA)
o Received the Achievement of Excellence in Procurement award for the ninth
consecutive year
o Reduced transit cost per mile by improving efficiency by nearly 10% and reduced
cost per hour by 9%, from $45.67 to $41.46
o Utilized seizure funds to backfill three police positions, provide training, purchase
equipment, and provide community program support for the annual 5th grade drug
awareness day event
o Received Governor’s Office of Highway Safety funding for six DUI breath detection
devices, four moving radar devices and $27,500 reimbursement for DUI enforcement
overtime and employee benefit expenses
Communication
The Town will ensure residents are educated about and highly engaged in Oro Valley
activities and moving community initiatives forward.
o Scanned and made all Town Council minutes, ordinances, resolutions, deeds and
easements available to the public through the Town’s new electronic document
management software
o All Town board and commission applications were received, processed and retained
electronically, allowing for easier submission by applicants and reduced processing
time for staff
o Completed the Your Voice, Our Future General Plan update in preparation for the
public vote in November 2016
o Held 15 neighborhood public outreach and awareness meetings for planning
amendments, including 2 for major General Plan amendments
o Continued the online budget questionnaire, “5 Questions in 5 Minutes,” to solicit
public input during preparation of the FY 2016-17 Town Budget, resulting in 254
responses
o Contracted with CodeRED to provide emergency notification services to the
community
o Received two 2016 Silver Circle Awards from the City-County Communications and
Marketing Association (3CMA) for excellence in communication and marketing for
the 2015 Aquatic Center summer marketing campaign and the 2015 BizTucson
Report
o Implemented the use of Facebook advertising to boost community awareness and
engagement
o Increased frequency of postings and video promotions through social media to
communicate Town events and initiatives to the community
o Developed the 2015 BizTucson Oro Valley Special Report to market at local,
regional, state, national and international trade shows
Economic Development
The Town Council and management are focused on attracting and retaining globally-
competitive high technology and bioscience businesses and employers while maximizing
the Town’s visitor destination opportunities.
o Collected approximately $1.5 million in plan review and permit fees, representing
nearly $118 million in work valuation for new private construction
o Provided wide range of construction assistance for residential and commercial
projects, including the Stone Canyon Clubhouse, a 45,000 square foot expansion at
Splendido, MOD Pizza, Smashburger, Gaslight Music Hall, a large modular
expansion at Ventana Medical Systems, and projects currently under construction,
which include Pima Federal Credit Union, Kneader’s Restaurant and the Apartments
at El Corredor
o Attracted the University of Arizona to expand its OneHealth public health consortium
into Oro Valley with a new doctor of veterinary medicine school
o Began development of the “Main Streets” concept of a centralized downtown hub for
shopping, dining and entertainment
o Hosted 35 swim competitions, two national tennis and two national golf
competitions, and brought two major league soccer teams to practice at Naranja Park
o Received sixth consecutive Playful City USA community designation
o Received the Mayor’s Challenge “Educate and Enforce” award for traffic safety from
the US department of Transportation
o Continued hosting the coffee with a cop program and expanded the event to include
the Mayor, Town Manager and the Golder Ranch Fire District
o Reached 151 active business in the adopt-a-business program
o Added 176 new metered connections for a total water utility customer base of 19,355
Parks, Recreation and Cultural Development
The Town Council and management are focused on developing exceptional recreation and
cultural facilities and programs that attract visitors and events that enhance residents’ quality
of life and strengthen the economy.
o Facilitated the first annual Oro Valley Music Festival featuring local and national
musical talent
o Partnered with the Tucson Children’s museum to open a satellite campus in Oro
Valley, which had over 33,000 visitors in its first year
o Partnered with the Southern Arizona Arts and Cultural Alliance to put on 37 public
concerts
o Spearheaded the grassroots community music group, “Oh for the Love of Music”
o Supported cultural events that attracted thousands of visitors including the Halloween
Spooktacular, 4th of July event at the Oro Valley Community Center, annual holiday
tree lighting and the Harvest Heritage Festival at Steampump Ranch
o Remodeled the Oro Valley Community Center fitness center with a coffee lounge and
art gallery and relaunched the Overlook restaurant with a new name, new menu and
new look
o Increased the number of recreation programs held from 38 to 52 with the addition of
the Oro Valley Community Center
o Installed a new ramada and bathroom facilities at Naranja Park to complement the
new multi-use sports fields and dog park
o Hosted over 1,300 summer camp participants through 67 camp and 99 swim activities
Community Infrastructure and Services
The Town Council and management are focused on the Town serving as the model for
innovative partnerships, services and performance in providing basic town services
o Approved continued funding for community-based public safety programs, including
school resource officers, dispose-a-med, adopt-a-business, coffee with a cop and
citizen volunteer assistance program
o Approved continued funding of Sun Shuttle dial-a-ride, providing direct transit
service for seniors and the disabled, as well as for all community members
o Completed the Naranja Road safety project
o Completed the design and bid specification for the Lambert Lane phase II project
o Completed the Rancho Vistoso/Highland Drive and sidewalk project
o Began partnership with the Town of Marana to assist with the Tangerine Road project
o Began the design for the La Cholla widening project from Overton Road to Tangerine
Road
o Installed LED illuminated street signs at the intersections of La Cañada Drive/
Naranja Drive and First Avenue/Tangerine Road
o Expanded staff’s over-the-counter permit review capability to include pools, building
permits off of a model (i.e. plot plans), attached covered porches or pergolas,
detached ramadas, site walls, sheds, and other small projects
o Acquired property for a new police substation and much-needed evidence facility
o Delivered record transit service ridership of 45,202, a 16% increase over the prior
fiscal year
o Citizen volunteer assistants program members contributed 14,933 volunteer hours
o Acquired 756 acre feet of groundwater extinguishment credits
o Recharged 10,305 acre feet of Central Arizona Project (CAP) water
o Water Utility completed the advanced metering infrastructure project
ECONOMIC CONDITIONS AND OUTLOOK
The information presented in the financial statements is perhaps best understood when it is considered
from the broader perspective of the specific environment within which the Town operates.
Revenue growth remains slow, but cautiously steady at both the local and state level. Revenues are
being impacted not only by an economy that continues to recover, but also by state legislative action
that is negatively affecting revenues for all Arizona cities and towns. The Town continues to provide
services and programs without a property tax to fund operations and, therefore, is dependent upon state
shared revenues and local sales tax as major sources of operating revenue. These sources accounted
for approximately 77% of total General Fund revenue for FY 2015-16.
Most of the major local sales tax categories experienced year-over-year increases compared to amounts
collected in FY 2014-15, with the exception of construction sales tax, as discussed below:
Retail tax collections totaled $6.8 million for FY 15-16, up 17%, or $1 million over last fiscal
year. The Town increased its local sales tax rate from 2% to 2.5% effective on March 1, 2015.
The additional 0.5% sales tax revenues are dedicated to funding the operating needs of the
Town’s newly acquired community center.
Restaurant and bar tax collections totaled $1.6 million for the fiscal year, up 23%, or $300,000
over last fiscal year. This category of sales tax was also increased from 2% to 2.5% effective
on March 1, 2015.
Construction sales tax collections totaled $2.4 million for the fiscal year, down 27%, or nearly
$900,000 from last fiscal year. This decline was due to the completion of several large multi-
family housing complexes that were under construction during FY 2014-2015 and state
legislative changes to the construction tax code that went into effect in January, 2015.
Utility tax collections totaled $2.9 million for the fiscal year, up 4%, or $100,000 over last
fiscal year.
The chart below is a look at the past five years’ local sales tax activity by category:
In FY 2015-16, the Town received $10.6 million for state shared revenues in the General Fund, up 2%,
or $161,000 over last fiscal year. The trend chart below depicts the performance of both of these
revenue categories since FY 2006-07:
Critical to our success in this area is the preparation of realistic growth assumptions that help guide our
revenue projections. We continue to see modest economic growth in Oro Valley and the region. The
projected residential development is considerable over the next five-year period; however, it will be
spread out more than originally projected as we saw the production of homes going vertical at a slower
pace than projected in the last few years. Currently, there is an inventory of nearly 1,400 residential
lots available in residential developments under construction town-wide. In FY 2015-16, we saw that
220 single family residential (SFR) building permits were issued. The FY 2016-17 budget includes the
assumption that 230 SFRs will be issued during the year as many developments have made their way
through the planning and approval process and are now ready to build. The budget reflects continued
modest growth in commercial activity with some new construction and tenant improvements of
previously-vacant space. Two significant development projects in this category have been included in
the revenue estimates for FY 2016-17: the new Amphitheater School District K-5 STEM school in
Rancho Vistoso, and the All Seasons Memory Care facility in the Innovation Corporate Center.
The below chart depicts the local trends in single family residential (SFR) building permits issued and
annual permit revenues from both residential and commercial construction activity from FY 2006-07
through FY 2016-17 projections.
Future Focus
During FY 2016-17, the Town will continue to identify and quantify both one-time revenues derived
from increased construction activity and recurring revenues derived from such areas as local sales taxes
and state-shared sources. The Town continues to dedicate one-time revenues to funding one-time
expenditures in the budget, specifically for capital improvement projects, while ensuring that sufficient
recurring revenues exist to fund recurring expenditures in the budget. With the expectation of sustained
and moderately increasing development activity continuing in future years, it will be important to
continue to analyze the budget in this manner to avoid future reliance on one-time revenues to fund
recurring costs.
For FY 2016-17, the Town will focus its efforts on supporting the elements of its adopted Strategic
Plan as follows: fiscal responsibility; communication; economic development; parks, recreation and
cultural development; and community infrastructure and services.
These strategies will be fulfilled in a number of different ways as highlighted below:
Employee performance merit and step increases have been budgeted for FY 2016-17 to
maintain fair and competitive compensation provided to the Town’s most valuable assets, its
employees.
The FY 2016-17 budget includes continued funding for its vehicle replacement program, which
includes the replacement of several vehicles town-wide, as well as setting aside funding for the
future replacement of vehicles at the end of their useful lives.
The FY 2016-17 budget includes more than $1.5 million for the Pavement Preservation
Program in the Highway Fund, which maintains the current condition of our streets and roads.
The FY 2016-17 budget includes investments in our parks and recreation facilities including
two new unlit multi-use (soccer) fields at Naranja Park, Community Center ADA
improvements, a Community Center family/teen area, tennis court improvements, golf cart
path improvements and Aquatic Center pool heaters.
The FY 2016-17 budget has dedicated funding to continue the process of updating the General
Plan, which is expected to go before voters in November of 2016.
The Town also continues to maintain strong investment grade ratings on its outstanding excise tax
bonds, rated “AA” by Standard and Poor’s and “AA-“ by Fitch Ratings. This is largely achieved by
the Council’s goal of continuing to diversify the Town’s revenue base and maintaining strong fund
balance reserves in the General Fund, currently at $10.5 million, or 32% of FY 2016-17 adopted
expenditures of $33.1 million. This is well above the Council-adopted policy threshold of 25% of
adopted expenditures.
AWARDS AND ACKNOWLEDGMENTS
Award. The Government Finance Officers Association of the United States and Canada (GFOA)
awarded a Certificate of Achievement for Excellence in Financial Reporting to the Town of Oro Valley
for its comprehensive annual financial report for the year ended June 30, 2015. This was the twenty-
second consecutive year that the Town has achieved this prestigious award. In order to be awarded a
Certificate of Achievement, a government must publish an easily readable and efficiently organized
comprehensive annual financial report. This report must satisfy both generally accepted accounting
principles and applicable legal requirements.
A Certificate of Achievement is valid for a period of one year only. We believe that our current
comprehensive annual financial report continues to meet the Certificate of Achievement Program’s
requirements and we are submitting it to the GFOA to determine its eligibility for another certificate.
Acknowledgments. The preparation of this Comprehensive Annual Financial Report could not have
been accomplished without the efficient and dedicated services of the entire staff of the Finance
Department who assisted and contributed in its preparation. We thank the Mayor and members of the
Town Council for their interest and support in planning and conducting the financial affairs of the
Town in a responsible and progressive manner.
Respectfully submitted,
Daniel G. Sharp Stacey Lemos, CPA
Interim Town Manager Finance Director
Organizational Chart
Oro Valley Residents
Town MagistrateTown Manager’s Office
Town Council
Finance Human Resources DISParks & RecreationITWater Utility
Communications
Economic Development
Operations
Planning & Engineering
Development Services
Infrastructure Services
Recreation
Parks
Business Application & Development
Technical Services
GIS Services Utility Administration
Appointed Boards & Commissions
Contract Town Attorney
Chief of Police
Field Services
Support Services
Legal Services
Prosecution
Civil
Aquatics
Town Clerk
Trails
Cultural Resources
TOWN OF ORO VALLEY, ARIZONA
LIST OF TOWN OFFICIALS
ELECTED OFFICIALS
Mayor Dr. Satish Hiremath
Vice-Mayor Mr. Lou Waters
Council Member Mr. Brendan Burns
Council Member Mr. William Garner
Council Member Mr. Joe Hornat
Council Member Ms. Mary Snider
Council Member Mr. Mike Zinkin
TOWN MANAGEMENT
Interim Town Manager Daniel G. Sharp
Finance Director Stacey Lemos, CPA
Human Resources Director Gary Bridget
Town Clerk Michael Standish
Magistrate George Dunscomb
Legal Services Director Tobin Sidles
Water Utility Director Philip Saletta
Interim Chief of Police Larry Stevens
Development & Infrastructure
Services Director/Town Engineer
Paul Keesler
Parks and Recreation Director Kristy Diaz-Trahan
Information Technology Director Chuck Boyer
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FINANCIAL SECTION
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INDEPENDENT AUDITOR’S REPORT
Honorable Mayor and Members of the Town Council
Town of Oro Valley, Arizona
Report on the Financial Statements
We have audited the accompanying financial statements of the governmental activities, business-type activities,
each major fund, and the aggregate remaining fund information of Town of Oro Valley, Arizona (Town), as of
and for the year ended June 30, 2016, and the related notes to the financial statements, which collectively
comprise the Town’s basic financial statements as listed in the table of contents.
Management’s Responsibility for the Financial Statements
Management is responsible for the preparation and fair presentation of these financial statements in accordance
with accounting principles generally accepted in the United States of America; this includes the design,
implementation, and maintenance of internal control relevant to the preparation and fair presentation of financial
statements that are free from material misstatement, whether due to fraud or error.
Auditor’s Responsibility
Our responsibility is to express opinions on these financial statements based on our audit. We conducted our
audit in accordance with auditing standards generally accepted in the United States of America and the standards
applicable to financial audits contained in Government Auditing Standards, issued by the Comptroller General
of the United States. Those standards require that we plan and perform the audit to obtain reasonable assurance
about whether the financial statements are free from material misstatement.
An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the
financial statements. The procedures selected depend on the auditor’s judgment, including the assessment of
the risks of material misstatement of the financial statements, whether due to fraud or error. In making those
risk assessments, the auditor considers internal control relevant to the entity’s preparation and fair presentation
of the financial statements in order to design audit procedures that are appropriate in the circumstances, but not
for the purpose of expressing an opinion on the effectiveness of the entity’s internal control. Accordingly, we
express no such opinion. An audit also includes evaluating the appropriateness of accounting policies used and
the reasonableness of significant accounting estimates made by management, as well as evaluating the overall
presentation of the financial statements.
We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit
opinions.
Opinions
In our opinion, the financial statements referred to above present fairly, in all material respects, the respective
financial position of the governmental activities, business-type activities, each major fund, and the aggregate
remaining fund information of the Town of Oro Valley, Arizona, as of June 30, 2016, and the respective changes
in financial position and, where applicable, cash flows thereof for the year then ended in accordance with
accounting principles generally accepted in the United States of America.
Change in Accounting Principle
As described in Note 1, the Town implemented the provisions of the Governmental Accounting Standards Board
(GASB) Statement No. 72, Fair Value Measurement and Application, for the year ended June 30, 2016, which
represents a change in accounting principle. Our opinion is not modified with respect to this matter.
Other Matters
Required Supplementary Information
Accounting principles generally accepted in the United States of America require that the Management’s
Discussion and Analysis, budgetary comparison information, and net pension liability information, as listed in
the table of contents, be presented to supplement the basic financial statements. Such information, although not
a part of the basic financial statements, is required by the Governmental Accounting Standards Board, who
considers it to be an essential part of financial reporting for placing the basic financial statements in an
appropriate operational, economic, or historical context. We have applied certain limited procedures to the
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.
Other Information
Our audit was conducted for the purpose of forming opinions on the financial statements that collectively
comprise the Town’s basic financial statements. The Introductory Section, Combining and Individual Fund
Financial Statements and Schedules, and Statistical Section are presented for purposes of additional analysis and
are not a required part of the basic financial statements.
The Combining and Individual Fund Financial Statements and Schedules are the responsibility of management
and were derived from and relate directly to the underlying accounting and other records used to prepare the
basic financial statements. Such information has been subjected to the auditing procedures applied in the audit
of the basic financial statements and certain additional procedures, including comparing and reconciling such
information directly to the underlying accounting and other records used to prepare the basic financial statements
or to the basic financial statements themselves, and other additional procedures in accordance with auditing
standards generally accepted in the United States of America. In our opinion, the Combining and Individual
Fund Financial Statements and Schedules Information is fairly stated in all material respects in relation to the
basic financial statements as a whole.
The Introductory Section and Statistical Section 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.
Other Reporting Required by Government Auditing Standards
In accordance with Government Auditing Standards, we have also issued our report dated November 18, 2016,
on our consideration of Town of Oro Valley, Arizona’s internal control over financial reporting and on our tests
of its compliance with certain provisions of laws, regulations, contracts, and grant agreements and other matters.
The purpose of that report is to describe the scope of our testing of internal control over financial reporting and
compliance and the results of that testing, and not to provide an opinion on the internal control over financial
reporting or on compliance. That report is an integral part of an audit performed in accordance with Government
Auditing Standards in considering Town of Oro Valley, Arizona’s internal control over financial reporting and
compliance.
Heinfeld, Meech & Co., P.C.
Tucson, Arizona
November 18, 2016
MANAGEMENT’S DISCUSSION AND ANALYSIS (MD&A)
(Required Supplementary Information)
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TOWN OF ORO VALLEY, ARIZONA
MANAGEMENT’S DISCUSSION AND ANALYSIS (MD&A)
YEAR ENDED JUNE 30, 2016
As management of the Town of Oro Valley, Arizona (Town), we offer readers of the Town’s financial
statements this narrative overview and analysis of the financial activities of the Town for the fiscal
year ended June 30, 2016. The management’s discussion and analysis is presented as required
supplementary information to supplement the basic financial statements. We encourage readers to
consider the information presented here in conjunction with additional information that we have
furnished in our letter of transmittal, which can be found in the introductory section of this report.
FINANCIAL HIGHLIGHTS
The financial statements which follow the Management’s Discussion and Analysis provide those
significant key financial highlights for 2015-16 as follows.
The Town’s total net position of governmental activities decreased $1.7 million to $126.2 million
and business-type activities increased $5.8 million to $80.8 million representing 61 percent and 39
percent respectively, of the total net position of $207.0 million.
General revenues from governmental activities accounted for $28.4 million in revenue, or 60
percent of all revenues from governmental activities. Program specific revenues in the form of
charges for services and grants and contributions accounted for $18.6 million or 40 percent of total
governmental activities revenues. The Town had $20.9 million of program revenues and $204,669
in general revenues related to business-type activities.
The Town had $48.7 million in expenses related to governmental activities, an increase of 11
percent from the prior fiscal year. The Town had $15.3 million in expenses related to business-
type activities, an increase of six percent from the prior fiscal year.
Among major funds, the General Fund had $31.9 million in revenues, which primarily consisted
of sales taxes and intergovernmental revenues. The total expenditures of the General Fund were
$30.5 million. The General Fund’s fund balance increased from $10.2 million to $10.5 million.
The Community Center Fund had $5.9 million in revenues, which consisted primarily of sales
taxes and charges for services. The total expenditures of the Community Center Fund were $7.8
million.
The Water Fund operating revenues of $15.1 million exceeded operating expenses of $12.9 million.
The increase in net position of $5.9 million was primarily due to revenues from charges for services
exceeding operating expenses.
TOWN OF ORO VALLEY, ARIZONA
MANAGEMENT’S DISCUSSION AND ANALYSIS (MD&A)
YEAR ENDED JUNE 30, 2016
OVERVIEW OF FINANCIAL STATEMENTS
This discussion and analysis are intended to serve as an introduction to the Town’s basic financial
statements. The Town’s basic financial statements comprise three components: 1) government-wide
financial statements, 2) fund financial statements, and 3) notes to the financial statements. This report
also contains other supplementary information in addition to the basic financial statements themselves.
Government-wide financial statements. The government-wide financial statements are designed to
provide readers with a broad overview of the Town’s finances, in a manner similar to a private-sector
business.
The statement of net position presents information on all of the Town’s assets liabilities, and deferred
inflows/outflows of resources with the difference between the two reported as net position. Over time,
increases or decreases in net position may serve as a useful indicator of whether the financial position
of the Town is improving or deteriorating.
The statement of activities presents information showing how the Town’s net position changed during
the most recent fiscal year. All changes in net position are reported as soon as the underlying event
giving rise to the change occurs, regardless of the timing of related cash flows. Thus, revenues and
expenses are reported in this statement for some items that will only result in cash flows in future fiscal
periods (e.g., uncollected taxes and earned but unused compensated absences).
In the government-wide financial statements the Town’s activities are presented in the following
categories:
Governmental activities – Most of the Town’s basic services are included here, such as general
government, public safety, highways and streets, and culture and recreation. Sales taxes,
intergovernmental, and charges for services finance most of these activities.
Business-type activities – The services provided by the Town included here are water and
stormwater utilities. The services are primarily financed through user fees and charges.
Fund Financial Statements. A fund is a grouping of related accounts that is used to maintain control
over resources that have been segregated for specific activities or objectives. The Town uses fund
accounting to ensure and demonstrate compliance with finance-related legal requirements. All of the
funds of the Town can be divided into two categories: governmental funds and proprietary funds.
Governmental funds. Governmental funds are used to account for essentially the same functions
reported as governmental activities in the government-wide financial statements. However, unlike
the government-wide financial statements, governmental fund financial statements focus on near-
term inflows of spendable resources, as well as on balances of spendable resources available at the
end of the fiscal year. Such information may be useful in evaluating the Town’s near-term financing
requirements.
TOWN OF ORO VALLEY, ARIZONA
MANAGEMENT’S DISCUSSION AND ANALYSIS (MD&A)
YEAR ENDED JUNE 30, 2016
OVERVIEW OF FINANCIAL STATEMENTS
Because the focus of governmental funds is narrower than that of the government-wide financial
statements, it is useful to compare the information presented for governmental funds with similar
information presented for governmental activities in the government-wide financial statements. By
doing so, readers may better understand the long-term impact of the Town’s near-term financing
decision. Both the governmental fund balance sheet and the governmental fund statement of
revenues, expenditures and changes in fund balances provide a reconciliation to facilitate this
comparison between governmental funds and governmental activities.
Information is presented separately in the governmental fund balance sheet and in the governmental
fund statement of revenues, expenditures and changes in fund balances for the General and
Community Center Funds, both of which are considered to be major funds. Data from the other
governmental funds are combined into a single, aggregated presentation. Individual fund data for
each of these non-major governmental funds is provided in the form of combining statements and
schedules.
Proprietary funds. The Town maintains two types of proprietary funds. Enterprise funds are used
to report the same functions presented as business-type activities in the government-wide financial
statements. The Town uses enterprise funds to account for its Oro Valley Water Utility and
Stormwater Drainage Utility. The Town uses internal service funds to account for its fleet
maintenance services and to finance its self-insured employee health benefits. Because these
services predominately benefit governmental rather than business-type functions, the internal
service funds have been included within governmental activities in the government-wide financial
statements.
Notes to the financial statements. The notes provide additional information that is essential to a full
understanding of the data provided in the government-wide and fund financial statements. The notes
to the financial statements can be found immediately following the basic financial statements.
Other information. In addition to the basic financial statements and accompanying notes, this report
also presents certain required supplementary information concerning the Town’s budget process and
pension plan. The Town adopts an annual expenditure budget for all governmental funds. A schedule
of revenues, expenditures and changes in fund balances – budget and actual has been provided for the
General Fund and the major Special Revenue Fund as required supplementary information. Schedules
for the pension plan have been provided as required supplementary information.
GOVERNMENT-WIDE FINANCIAL ANALYSIS
Net position may serve over time as a useful indicator of a government’s financial position. In the case
of the Town, assets and deferred outflows exceeded liabilities and deferred inflows by $207.0 million
as of the current fiscal year end.
The largest portion of the Town’s net position reflects its investment in capital assets (e.g., land,
buildings and improvements, improvements other than buildings, infrastructure, vehicles, machinery
and equipment and construction in progress), less any related outstanding debt used to acquire those
assets.
TOWN OF ORO VALLEY, ARIZONA
MANAGEMENT’S DISCUSSION AND ANALYSIS (MD&A)
YEAR ENDED JUNE 30, 2016
GOVERNMENT-WIDE FINANCIAL ANALYSIS
The Town uses these capital assets to provide services to its citizens; consequently, these assets are not
available for future spending. Although the Town’s investment in its capital assets is reported net of
related outstanding 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.
The following table presents a summary of the Town’s net position for the fiscal years ended
June 30, 2016 and June 30, 2015.
2016
Governmental
Activities
2015
Governmental
Activities
2016
Business-type
Activities
2015
Business-type
Activities 2016 Total 2015 Total
Current and other assets $ 25,492,595 $ 27,920,274 $ 26,967,200 $ 25,242,566 $ 52,459,795 $ 53,162,840
Capital assets, net 143,475,577 144,069,485 103,167,086 100,830,880 246,642,663 244,900,365
Total assets 168,968,172 171,989,759 130,134,286 126,073,446 299,102,458 298,063,205
Deferred outflows 7,159,926 5,837,919 2,217,565 2,354,675 9,377,491 8,192,594
Current and other liabilities 5,531,577 6,532,855 3,515,815 2,988,661 9,047,392 9,521,516
Long-term liabilities 42,644,832 39,372,914 47,687,319 49,764,065 90,332,151 89,136,979
Total liabilities 48,176,409 45,905,769 51,203,134 52,752,726 99,379,543 98,658,495
Deferred inflows 1,761,164 4,015,632 382,698 724,253 2,143,862 4,739,885
Net investment in capital assets 132,419,826 133,800,218 61,261,271 54,858,448 193,681,097 188,658,666
Restricted 4,653,905 3,599,966 4,653,905 3,599,966
Unrestricted (10,883,206) (9,493,907) 19,504,748 20,092,694 8,621,542 10,598,787
Total net position $ 126,190,525 $127,906,277 $ 80,766,019 $ 74,951,142 $ 206,956,544 $ 202,857,419
The Town’s financial position is the product of several financial transactions including the net results
of activities, the acquisition and payment of debt, the acquisition and disposal of capital assets, and the
depreciation of capital assets. The following are significant current year transactions that have had an
impact on the Statement of Net position.
The addition of $5.7 million in business-type activities capital assets through improvements to
the existing water system.
The addition of $8.5 million in governmental activities capital assets, mostly consisting of
multiple road improvements and pavement preservation upgrades
The decrease of $2.4 million in business-type activities long-term debt was primarily due to
the issuance of $1.2 million of refunding bonds, the issuance of $1.3 million of loans, and
annual debt service payments of $5.0 million.
The increase of $97,622 in governmental activities long-term debt was primarily due to the
addition of $1.0 million of capital lease obligations, and net refunding of $500 thousand.
TOWN OF ORO VALLEY, ARIZONA
MANAGEMENT’S DISCUSSION AND ANALYSIS (MD&A)
YEAR ENDED JUNE 30, 2016
GOVERNMENT-WIDE FINANCIAL ANALYSIS
Changes in net position. The Town’s total revenues for the current fiscal year were $68.1 million.
The total cost of all programs and services was $64.1 million. The following table presents a summary
of the changes in net position for the fiscal years ended June 30, 2016 and June 30, 2015.
2016
Governmental
Activities
2015
Governmental
Activities
2016
Business-type
Activities
2015
Business-type
Activities
2016
Total
2015
Total
Revenues:
Program revenues:
Charges for services $ 9,492,509 $ 5,223,071 $ 17,567,838 $ 16,860,275 $ 27,060,347 $ 22,083,346
Operating grants and contributions 5,503,530 5,070,396 35,000 5,538,530 5,070,396
Capital grants and contributions 3,602,656 2,456,727 3,334,372 1,979,037 6,937,028 4,435,764
General revenues:
Sales taxes 16,998,464 16,132,159 16,998,464 16,132,159
Franchise taxes 621,546 582,064 621,546 582,064
Unrestricted state shared revenues 10,549,196 10,413,464 10,549,196 10,413,464
Investment earnings 238,210 216,175 204,669 124,887 442,879 341,062
Total revenues 47,006,111 40,094,056 21,141,879 18,964,199 68,147,990 59,058,255
Expenses:
General government 11,888,794 11,533,702 11,888,794 11,533,702
Public safety 16,123,500 16,587,168 16,123,500 16,587,168
Highways and streets 9,089,318 9,400,140 9,089,318 9,400,140
Transit 1,432,910 1,404,646 1,432,910 1,404,646
Culture and recreation 9,695,639 4,572,490 9,695,639 4,572,490
Interest on long-term debt 494,732 439,027 494,732 439,027
Water 14,406,074 13,608,931 14,406,074 13,608,931
Stormwater drainage 917,898 854,510 917,898 854,510
Total expenses 48,724,893 43,937,173 15,323,972 14,463,441 64,048,865 58,400,614
Transfers 3,030 3,119 (3,030) (3,119)
Changes in net position (1,715,752) (3,839,998) 5,814,877 4,497,639 4,099,125 657,641
Net position, beginning, as restated 127,906,277 131,746,275 74,951,142 70,453,503 202,857,419 202,199,778
Net position, ending $ 126,190,525 $127,906,277 $ 80,766,019 $ 74,951,142 $ 206,956,544 $ 202,857,419
Total expenses increased $5.6 million, or 10 percent, primarily due to the Town’s community center
being in operation for a full year.
The increase of $9.1 million in total revenues was largely due to increased capital contributions from
developers and a $4.9 million increase in community center charges for services due to a full year of
operations.
Business-type activities capital grants and contributions increased by $1.4 million due to the execution
of several line extension agreements with developers for several new home construction projects.
TOWN OF ORO VALLEY, ARIZONA
MANAGEMENT’S DISCUSSION AND ANALYSIS (MD&A)
YEAR ENDED JUNE 30, 2016
GOVERNMENT-WIDE FINANCIAL ANALYSIS
Governmental and Business-type activities. The following table presents the cost of the Town’s
major functional activities. The table also shows each function’s net cost (total cost less charges for
services generated by the activities and intergovernmental aid provided for specific programs). The
net cost shows the financial burden that was placed on the State and Town’s taxpayers by each of these
functions.
2016 2015
Governmental Activities
Total
Expenses
Net (Expense)/
Revenue
Total
Expenses
Net (Expense)/
Revenue
General government $ 11,888,794 $ (7,610,593) $ 11,533,702 $ (7,800,394)
Public safety 16,123,500 (15,271,780) 16,587,168 (15,706,629)
Highways and streets 9,089,318 (1,547,930) 9,400,140 (3,661,685)
Transit 1,432,910 (46,057) 1,404,646 (141,068)
Culture and recreation 9,695,639 (5,155,106) 4,572,490 (3,438,176)
Interest on long-term debt 494,732 (494,732) 439,027 (439,027)
Total $ 48,724,893 $ (30,126,198) $ 43,937,173 $ (31,186,979)
Business-type Activities
Water $ 14,406,074 $ 5,667,878 $ 13,608,931 $ 4,458,787
Stormwater drainage 917,898 (54,640) 854,510 (82,916)
Total $ 15,323,972 $ 5,613,238 $ 14,463,441 $ 4,375,871
The cost of all governmental activities this year was $48.7 million. The increase of $4.8 million
from the prior year was due primarily to culture and recreation expenses from the Community
Center for a full year of operations.
The cost of all business-type activities this year was $15.3 million. The increase of $860,531
from the prior year was primarily due to an increase in operation and maintenance costs
associated with the Water Utility department.
Federal and State governments, developer contributions, and charges for services subsidized
certain governmental programs and business-type programs with revenues of $39.5 million.
Net cost of governmental activities of $30.1 million was financed by general revenues, which
are made up of primarily sales taxes and state shared revenues of $27.5 million.
FINANCIAL ANALYSIS OF THE TOWN’S FUNDS
As noted earlier, the Town uses fund accounting to ensure and demonstrate compliance with finance-
related legal requirements.
Governmental funds. The focus of the Town’s governmental funds is to provide information on near-
term inflows, outflows, and balances of spendable resources. Such information is useful in assessing
the Town’s financing requirements. In particular, unassigned fund balance may serve as a useful
measure of the Town’s net resources available for spending at the end of the fiscal year.
TOWN OF ORO VALLEY, ARIZONA
MANAGEMENT’S DISCUSSION AND ANALYSIS (MD&A)
YEAR ENDED JUNE 30, 2016
FINANCIAL ANALYSIS OF THE TOWN’S FUNDS
The financial performance of the Town as a whole is reflected in its governmental funds. As the Town
completed the year, its governmental funds reported a combined fund balance of $18.6 million, a
decrease of $1.3 million. This was primarily due to the completion of several capital improvement
projects such as, the Aquatic Center parking lot expansion, $195,000, Police Property and ID facility
improvements, $500,000, Steam Pump Ranch improvements, $200,000, and the addition of a restroom
at Naranja Park, $150,000. In addition, this was the first full year of operations for the Community and
Recreation Center.
The General Fund is the principal operating fund of the Town. The fund balance increased by $372,678
million in the General Fund to $10.5 million for the current fiscal year primarily due to expenditures
coming in below budget in most departments.
The Community Center Fund's fund balance decreased $863,477 to $161,745 primarily due to
improvements to the Community Center facility and facility operating costs exceeding revenues. As
fiscal year 2015-16 was the first full year of operation of the Community Center by the Town, it was a
year of transition, investment and developing programming to sustain and increase memberships. As
such, this use of fund balance was planned and anticipated as part of the facility investment and
operations.
Proprietary funds. Net position of the Enterprise Funds at the end of the year amounted to $80.8
million. This increased by $5.8 million during the fiscal year to the extent that revenues exceeded
expenses in the fund and from capital contributions from developers.
BUDGETARY HIGHLIGHTS
There were amendments to the Town of Oro Valley’s fiscal year 2015-16 operating and capital budget.
A schedule showing the original and final budget amounts compared to the Town’s actual financial
activity for the General Fund is provided in this report as required supplementary information. The
significant variances are summarized as follows:
The unfavorable variance of $867,529 in sales tax revenue was a result of construction sales
tax collections coming in under budget due to the delayed construction timing of several new
commercial and residential housing developments. These revenues are anticipated to be
received in fiscal year 2016-17. Also impacting this area were State legislative changes to the
construction contracting sections of the tax code, eliminating certain categories of construction
from the payment of construction sales taxes.
The favorable variance of $226,381 in charges for services was a result of collections from
court fees, Aquatic Center user fees and Transit fare box fees exceeding budget.
The unfavorable variance of $144,504 in general government expenditures was a result of the
pay out of accrued leave balances to several long-term employees due to retirement. The Town
had sufficient resources in its reserve balance to cover these accrued leave expenditures.
TOWN OF ORO VALLEY, ARIZONA
MANAGEMENT’S DISCUSSION AND ANALYSIS (MD&A)
YEAR ENDED JUNE 30, 2016
CAPITAL ASSETS AND DEBT ADMINISTRATION
Capital Assets. At year end, the Town had invested $246.7 million in capital assets (net of accumulated
depreciation), including buildings, facilities, vehicles, computers, equipment, and infrastructure assets.
This amount represents a net increase of $1.7 million from last year. This was primarily due to road
improvement projects and expansion of the Town’s water system, as well as depreciation expense of
$12.4 million.
The following schedule presents capital asset balances for the fiscal years ended June 30, 2016 and
June 30, 2015.
Governmental Activities
As of
June 30, 2016
As of
June 30, 2015
Land $ 19,518,801 $ 19,253,801
Infrastructure 168,952,706 166,966,180
Buildings and improvements 30,092,900 28,715,296
Machinery, equipment, and vehicles 16,122,605 14,436,773
Construction in progress 6,070,883 3,414,286
Less: Accumulated depreciation (97,282,318) (88,716,851)
Total $ 143,475,577 $ 144,069,485
Business-type Activities
Land $ 2,410,660 $ 2,410,660
Water rights 8,534,490 8,534,490
Water system 126,061,264 120,915,619
Stormwater system 2,846,177 2,846,177
Equipment and vehicles 5,225,374 5,054,493
Construction in progress 874,446 457,559
Less: Accumulated depreciation (42,785,325) (39,388,117)
Total $ 103,167,086 $ 100,830,881
Additional information on the Town’s capital assets can be found in Note 6.
TOWN OF ORO VALLEY, ARIZONA
MANAGEMENT’S DISCUSSION AND ANALYSIS (MD&A)
YEAR ENDED JUNE 30, 2016
CAPITAL ASSETS AND DEBT ADMINISTRATION
Debt Administration. At year end, the Town had $52.0 million in long-term debt outstanding, $4.7
million due within one year. The following table presents a summary of the Town’s outstanding long-
term debt for the fiscal years ended June 30, 2016 and June 30, 2015.
Governmental Activities 2016 2015
Revenue bonds $ 7,688,890 $ 8,179,610
Special assessment bonds 780,000 925,000
Note payable 700,000 1,000,000
Capital leases 966,692 128,594
Total $ 10,135,582 $ 10,233,204
Business-type Activities
Revenue bonds $ 32,951,110 $ 35,985,390
Loan payable 8,879,907 8,169,765
Capital leases 80,423 118,862
Total $ 41,911,440 $ 44,274,017
State statutes currently limit the amount of general obligation debt a Town may issue to 20 percent of
its net full cash assessed valuation for water, sewer, lights, open space preserves, parks, playgrounds
and recreational facilities. The current debt limitation for the Town is $118.7 million.
The Town of Oro Valley has a bond rating of “AA-” rating from both Standard & Poor’s and Fitch
Ratings on its excise tax revenue bonds and an “AA” rating from Standard & Poor’s on outstanding
water revenue bonds.
Additional information on the Town’s long-term debt can be found in Notes 7 through 11.
ECONOMIC FACTORS AND NEXT YEAR’S BUDGET AND RATES
The unemployment rate for the Town of Oro Valley is currently 5.3 percent. Pima County’s
and the State of Arizona’s unemployment rates are 5.7 percent and 5.8 percent, respectively.
The Town’s net full cash assessed valuation for the current year is $593,299,222.
Single family residential (SFR) building permits issued in this fiscal year totaled 220, as
compared to 141 SFR building permits issued last fiscal year. Projections for SFR building
permits are 230 for fiscal year 2016-17.
TOWN OF ORO VALLEY, ARIZONA
MANAGEMENT’S DISCUSSION AND ANALYSIS (MD&A)
YEAR ENDED JUNE 30, 2016
ECONOMIC FACTORS AND NEXT YEAR’S BUDGET AND RATES
The adopted combined operating and capital expenditure budget for fiscal year 2016-17 totals $125.9
million, an increase of $6.2 million, or 5.2 percent over last year’s budget of $119.7 million. This
increase is primarily attributed to funding for an energy efficiency project at the Community Center
for $3.0 million and bonding capacity for parks and recreation expansion/improvements for
$5.0 million. The budget for fiscal year 2016-17 continues to place emphasis on the following: achieve
the goals identified in the Town’s adopted Strategic Plan and voter-approved general plan: fiscal
responsibility; communication; economic development; parks, recreation and cultural development;
and community infrastructure and services.
CONTACTING THE TOWN’S FINANCIAL MANAGEMENT
This financial report is designed to provide our citizens, taxpayers, customers, and investors and
creditors with a general overview of the Town’s finances and to demonstrate the Town’s accountability
for the resources it receives. If you have questions about this report or need additional information,
contact the Finance Department, Town of Oro Valley, Arizona, 11000 North La Cañada Drive, Oro
Valley, Arizona 85737.
BASIC FINANCIAL STATEMENTS
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GOVERNMENT-WIDE FINANCIAL STATEMENTS
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ASSETS
Current assets:
Cash and cash equivalents
Taxes receivable
Accounts receivable
Intergovernmental receivable
Special assessments
Inventories
Prepaid items
Total current assets
Noncurrent assets:
Capital assets, non-depreciable
Capital assets, depreciable (net)
Total noncurrent assets
Total assets
DEFERRED OUTFLOWS OF RESOURCES
Deferred charge on refunding
Pension plan items
Total deferred outflows of resources
LIABILITIES
Current liabilities:
Accounts payable
Accrued wages and benefits
Intergovernmental payable
Interest payable
Unearned revenue
Customer deposits payable
Other accrued liabilities
Note payable
Compensated absences
Capital leases payable
Loans payable
Bonds payable
Total current liabilities
Noncurrent liabilities:
Non-current portion of long-term obligations
Total noncurrent liabilities
Total liabilities
DEFERRED INFLOWS OF RESOURCES
Pension plan items
NET POSITION
Net investment in capital assets
Restricted for:
Public safety
Capital outlay
Debt service
Unrestricted
Total net position
Governmental
Activities
$ 21,754,382
755,071
528,799
1,439,474
790,000
112,788
112,081
25,492,595
25,589,684
117,885,893
143,475,577
168,968,172
112,421
7,047,505
7,159,926
1,338,767
2,323,508
169,760
784,585
308,815
606,142
350,000
1,403,069
248,020
477,940
8,010,606
40,165,803
40,165,803
48,176,409
1,761,164
132,419,826
85,551
4,498,900
69,454
(10,883,206)
$126,190,525
Business-type
Activities
$ 24,700,883
2,262,817
3,500
26,967,200
11,819,595
91,347,491
103,167,086
130,134,286
1,692,600
524,965
2,217,565
766,133
180,857
1,196,049
757,716
615,060
203,353
41,848
601,322
3,054,060
7,416,398
43,786,736
43,786,736
51,203,134
382,698
61,261,271
19,504,748
$80,766,019
Total
$ 46,455,265
755,071
2,791,616
1,439,474
790,000
112,788
115,581
52,459,795
37,409,279
209,233,384
246,642,663
299,102,458
1,805,021
7,572,470
9,377,491
2,104,900
2,504,365
1,365,809
757,716
784,585
923,875
606,142
350,000
1,606,422
289,868
601,322
3,532,000
15,427,004
83,952,539
83,952,539
99,379,543
2,143,862
193,681,097
85,551
4,498,900
69,454
8,621,542
$206,956,544
TOWN OF ORO VALLEY, ARIZONA
STATEMENT OF NET POSITION
JUNE 30, 2016
The notes to the basic financial statements are an integral part of this statement.
Program Revenues
Net (Expense)
Revenue and
Changes in Net
Position
Functions/Programs
Primary Government
Governmental activities:
General government
Public safety
Highway and streets
Transit
Culture and recreation
Interest on long-term debt
Total governmental activities
Business-type activities:
Water
Stormwater drainage
Total business-type activities
Total primary government
Expenses
$ 11,888,794
16,123,500
9,089,318
1,432,910
9,695,639
494,732
48,724,893
14,406,074
917,898
15,323,972
$64,048,865
Charges for
Services
$ 4,096,927
168,808
764,397
88,684
4,373,693
9,492,509
16,739,580
828,258
17,567,838
$27,060,347
Operating
Grants and
Contributions
$ 181,274
624,816
3,232,431
1,298,169
166,840
5,503,530
35,000
35,000
$5,538,530
Capital Grants
and
Contributions
$
58,096
3,544,560
3,602,656
3,334,372
3,334,372
$6,937,028
Governmental
Activities
$ (7,610,593)
(15,271,780)
(1,547,930)
(46,057)
(5,155,106)
(494,732)
(30,126,198)
(30,126,198)
General revenues:
Taxes:
Sales taxes
Franchise taxes
Unrestricted state shared revenues
Investment earnings
Transfers
Total general revenues and transfers
Changes in net position
Net position, beginning of year
Net position, end of year
16,998,464
621,546
10,549,196
238,210
3,030
28,410,446
(1,715,752)
127,906,277
$126,190,525
TOWN OF ORO VALLEY, ARIZONA
STATEMENT OF ACTIVITIES
YEAR ENDED JUNE 30, 2016
The notes to the basic financial statements are an integral part of this statement.
Net (Expense) Revenue and
Changes in Net Position
Business-type
Activities
$
5,667,878
(54,640)
5,613,238
5,613,238
Totals
$ (7,610,593)
(15,271,780)
(1,547,930)
(46,057)
(5,155,106)
(494,732)
(30,126,198)
5,667,878
(54,640)
5,613,238
(24,512,960)
204,669
(3,030)
201,639
5,814,877
74,951,142
$80,766,019
16,998,464
621,546
10,549,196
442,879
28,612,085
4,099,125
202,857,419
$206,956,544
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FUND FINANCIAL STATEMENTS
ASSETS
Cash and cash equivalents
Taxes receivable
Accounts receivable
Intergovernmental receivable
Special assessments
Due from other funds
Inventories
Prepaid items
Total assets
LIABILITIES, DEFERRED INFLOWS OF
RESOURCES AND FUND BALANCES
Liabilities:
Accounts payable
Accrued wages and benefits
Intergovernmental payable
Sales tax payable
Unearned revenue
Due to other funds
Customer deposits payable
Other accrued liabilities
Total liabilities
Deferred inflows of resources:
Unavailable revenues - special assessments
Fund balances (deficits):
Nonspendable
Restricted
Committed
Assigned
Unassigned
Total fund balances
Total liabilities, deferred inflows of resources
and fund balances
General Fund
$ 12,567,993
755,071
341,122
507,504
29,103
97,269
$14,298,062
$ 659,249
2,217,525
169,760
173,069
245,091
308,815
3,773,509
97,269
1,441,862
8,985,422
10,524,553
$14,298,062
Community
Center
$ 751,145
112,609
112,788
14,812
$991,354
$ 106,078
539,494
184,037
829,609
127,600
34,145
161,745
$991,354
Non-Major
Governmental
Funds
$ 7,629,364
931,970
790,000
$9,351,334
$ 498,821
105,983
29,103
633,907
790,000
4,079,173
2,536,461
1,340,991
(29,198)
7,927,427
$9,351,334
TOWN OF ORO VALLEY, ARIZONA
BALANCE SHEET - GOVERNMENTAL FUNDS
JUNE 30, 2016
The notes to the basic financial statements are an integral part of this statement.
Total
Governmental
Funds
$ 20,948,502
755,071
453,731
1,439,474
790,000
29,103
112,788
112,081
$24,640,750
$ 1,264,148
2,323,508
169,760
173,069
784,585
29,103
308,815
184,037
5,237,025
790,000
224,869
4,079,173
2,570,606
2,782,853
8,956,224
18,613,725
$24,640,750
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Total governmental fund balances 18,613,725$
Amounts reported for governmental activities in the Statement of
Net Position are different because:
Capital assets used in governmental activities are not financial
resources and, therefore, are not reported in the funds.
Governmental capital assets 240,757,895$
Less accumulated depreciation (97,282,318) 143,475,577
Special assessments receivable are not available to pay for current period
expenditures and therefore are reported as unavailable revenue in the funds. 790,000
Deferred items related to the net cost of issuance of bonds
are amortized over the life of the associated bond issue
in the government-wide statements but not reported in the funds.
Deferred charge on refunding 112,421
Deferred bond premium (27,748) 84,673
Deferred outflows and inflows of resources related to
pensions are applicable to future periods and, therefore,
are not reported in the funds.
Deferred outflows of resources related to pensions 7,033,594
Deferred inflows of resources related to pensions (1,751,023) 5,282,571
The Internal Service Fund is used by management to charge
the cost of services to the individual funds. The assets and
liabilities of the Internal Service Fund are included in the
Statement of Net Position.461,457
Long-term liabilities are not due and payable in the current
period and, therefore, are not reported in the funds.
Special assessment bonds (780,000)
Revenue bonds (7,688,890)
Note payable (700,000)
Capital leases (966,692)
Net pension liability (30,583,092)
Compensated absences (1,798,804)(42,517,478)
Net position of governmental activities 126,190,525$
TOWN OF ORO VALLEY, ARIZONA
RECONCILIATION OF THE BALANCE SHEET - GOVERNMENTAL FUNDS
TO THE STATEMENT OF NET POSITION
JUNE 30, 2016
The notes to the basic financial statements are an integral part of this statement.
Revenues:
Sales taxes
Franchise taxes
Development impact fees
Special assessments
Intergovernmental
Licenses, fees & permits
Fines, forfeitures & penalties
Charges for services
Contributions and donations
Investment earnings
Other
Total revenues
Expenditures:
Current -
General government
Public safety
Highway and streets
Transit
Culture and recreation
Capital outlay
Debt service -
Principal retirement
Interest and fiscal charges
Bond issuance costs
Total expenditures
Excess (deficiency) of revenues over expenditures
Other financing sources (uses):
Capital lease agreements
Sale of refunding bonds
Transfers in
Transfers out
Payment to bond escrow agent
Total other financing sources (uses):
Changes in fund balances
Fund balances, beginning of year
Fund balances, end of year
General Fund
$ 13,913,125
621,546
12,732,130
1,872,858
159,154
2,100,215
162,310
322,640
31,883,978
10,775,836
15,182,914
1,432,910
3,033,101
41,608
3,845
30,470,214
1,413,764
185,000
(1,226,086)
(1,041,086)
372,678
10,151,875
$10,524,553
Community
Center
$ 2,030,750
3,721,843
149,513
3,946
5,906,052
6,064,651
1,542,988
180,109
24,995
7,812,743
(1,906,691)
1,043,214
1,043,214
(863,477)
1,025,222
$161,745
Non-Major
Governmental
Funds
$ 1,054,589
795,471
189,525
6,755,936
43,134
124,316
134,000
75,900
178,210
9,351,081
650,851
311,618
2,754,413
6,452,352
675,920
307,670
104,533
11,257,357
(1,906,276)
2,529,250
1,687,026
(642,910)
(2,523,121)
1,050,245
(856,031)
8,783,458
$7,927,427
TOWN OF ORO VALLEY, ARIZONA
STATEMENT OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCES -
GOVERNMENTAL FUNDS
YEAR ENDED JUNE 30, 2016
The notes to the basic financial statements are an integral part of this statement.
Total
Governmental
Funds
$ 16,998,464
621,546
795,471
189,525
19,488,066
1,915,992
283,470
5,956,058
149,513
238,210
504,796
47,141,111
11,426,687
15,494,532
2,754,413
1,432,910
9,097,752
7,995,340
897,637
336,510
104,533
49,540,314
(2,399,203)
1,043,214
2,529,250
1,872,026
(1,868,996)
(2,523,121)
1,052,373
(1,346,830)
19,960,555
$18,613,725
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Changes in fund balances - total governmental funds (1,346,830)$
Amounts reported for governmental activities in the Statement of Activities are
different because:
Governmental funds report the portion of capital outlay for capitalized assets as expenditures.
However, in the Statement of Activities, the costs of those assets are allocated over their
estimated useful lives as depreciation expense.
Expenditures for capitalized assets 8,459,549$
Less current year depreciation (9,015,552) (556,003)
Special assessment revenues in the Statement of Activities do not provide current financial resources
and therefore are not reported as revenues in the governmental funds. (135,000)
Issuance of capital lease obligations provides current financial resources to governmental funds,
but the issuance increases long term liabilities in the Statement of Net Position. (1,043,214)
Repayments of long-term debt principal are expenditures in the governmental
funds, but the repayment reduces long-term liabilities in the Statement of
Net Position.
Note payable principal retirement 300,000
Capital lease principal retirement 221,717
Revenue bond principal retirement 474,119
Special assessment bond principal retirement 145,000 1,140,836
Governmental funds report pension contributions as expenditures. However,
they are reported as deferred outflows of resources in the Statement of
Net Position. The change in the net pension liability, adjusted for deferred
pension items, is reported as pension expense in the Statement of Activities.
Current year pension contributions 2,624,688
Pension expense (2,641,481) (16,793)
Some expenses reported in the Statement of Activities do not require the use of
current financial resources and, therefore, are not reported as expenditures in
governmental funds.
Amortization of premium on long-term debt 8,315
Amortization of deferred charge on refunded debt (11,332)
Loss on disposal of assets (37,905)
Compensated absences 225,903 184,981
The Internal Service Fund is used by management to charge the cost of
insurance to the individual funds. The changes in net position of the Internal
Service Fund is reported with governmental activities in the Statement of Activities.56,271
Changes in net position in governmental activities (1,715,752)$
TOWN OF ORO VALLEY, ARIZONA
RECONCILIATION OF THE STATEMENT OF REVENUES, EXPENDITURES AND CHANGES
IN FUND BALANCES - GOVERNMENTAL FUNDS TO THE STATEMENT OF ACTIVITIES
YEAR ENDED JUNE 30, 2016
The notes to the basic financial statements are an integral part of this statement.
Enterprise Funds
ASSETS
Current assets:
Cash and cash equivalents
Accounts receivable
Prepaid items
Total current assets
Noncurrent assets:
Capital assets, non-depreciable
Capital assets, depreciable (net)
Total noncurrent assets
Total assets
DEFERRED OUTFLOWS OF RESOURCES
Deferred charge on refunding
Pension plan items
Total deferred outflows of resources
LIABILITIES
Current liabilities:
Accounts payable
Accrued wages and benefits
Intergovernmental payable
Interest payable
Customer deposits payable
Compensated absences
Capital leases payable
Loans payable
Bonds payable
Claims payable
Total current liabilities
Noncurrent liabilities:
Non-current portion of long-term obligations
Total noncurrent liabilities
Total liabilities
DEFERRED INFLOWS OF RESOURCES
Pension plan items
NET POSITION
Net investment in capital assets
Unrestricted
Total net position
Water
$ 24,411,084
2,095,381
3,500
26,509,965
11,819,595
88,206,374
100,025,969
126,535,934
1,692,600
473,493
2,166,093
749,936
163,805
1,196,049
757,716
615,060
192,507
601,322
3,054,060
7,330,455
43,342,115
43,342,115
50,672,570
345,175
58,200,577
19,483,705
$77,684,282
Non-Major
Enterprise Funds
$ 289,799
167,436
457,235
3,141,117
3,141,117
3,598,352
51,472
51,472
16,197
17,052
10,846
41,848
85,943
444,621
444,621
530,564
37,523
3,060,694
21,043
$3,081,737
Totals
$ 24,700,883
2,262,817
3,500
26,967,200
11,819,595
91,347,491
103,167,086
130,134,286
1,692,600
524,965
2,217,565
766,133
180,857
1,196,049
757,716
615,060
203,353
41,848
601,322
3,054,060
7,416,398
43,786,736
43,786,736
51,203,134
382,698
61,261,271
19,504,748
$80,766,019
TOWN OF ORO VALLEY, ARIZONA
STATEMENT OF NET POSITION
PROPRIETARY FUNDS
JUNE 30, 2016
The notes to the basic financial statements are an integral part of this statement.
Governmental
Activities:
Internal Service
Funds
$ 805,880
75,068
880,948
880,948
13,911
13,911
74,619
249,036
323,655
99,606
99,606
423,261
10,141
461,457
$461,457
Enterprise Funds
Operating revenues:
Charges for services
Other
Self insurance premiums
Total operating revenues
Operating expenses:
Costs of sales and services
Depreciation and amortization
Claims payments
Administrative fees
Reinsurance premiums
Total operating expenses
Operating income (loss)
Nonoperating revenues (expenses):
Development impact fees
Intergovernmental
Connection fees
Investment earnings
Interest expense
Total nonoperating revenues (expenses)
Income (loss) before capital contributions and transfers
Capital contributions
Transfers out
Changes in net position
Total net position, beginning of year
Total net position, end of year
Water
$ 15,079,500
20,768
15,100,268
9,485,641
3,419,862
12,905,503
2,194,765
1,094,460
544,852
204,035
(1,500,571)
342,776
2,537,541
3,334,372
(3,030)
5,868,883
71,815,399
$77,684,282
Non-Major
Enterprise Funds
$ 828,258
828,258
767,211
150,687
917,898
(89,640)
35,000
634
35,634
(54,006)
(54,006)
3,135,743
$3,081,737
Totals
$ 15,907,758
20,768
15,928,526
10,252,852
3,570,549
13,823,401
2,105,125
1,094,460
35,000
544,852
204,669
(1,500,571)
378,410
2,483,535
3,334,372
(3,030)
5,814,877
74,951,142
$80,766,019
TOWN OF ORO VALLEY, ARIZONA
STATEMENT OF REVENUES, EXPENSES AND CHANGES IN FUND NET POSITION -
PROPRIETARY FUNDS
FOR THE YEAR ENDED JUNE 30, 2016
The notes to the basic financial statements are an integral part of this statement.
Governmental
Activities:
Internal Service
Funds
$ 1,363,351
77,074
3,015,655
4,456,080
1,196,465
2,513,124
57,000
633,220
4,399,809
56,271
56,271
56,271
405,186
$461,457
Governmental
Activities
Water
Non-Major
Enterprise Funds Total
Internal Service
Funds
Increase (Decrease) in Cash and Cash Equivalents
Cash flows from operating activities:
Cash received from customers 14,953,022$ 756,324$ 15,709,346$ 1,440,425$
Cash received from premiums 2,940,587
Cash payments to suppliers for goods and services (6,653,377) (493,059) (7,146,436) (1,815,135)
Cash payments to employees for services (2,171,712) (270,505) (2,442,217) (65,097)
Cash payments for claims (2,426,789)
Net cash provided by (used for) operating activities 6,127,933 (7,240) 6,120,693 73,991
Cash flows from noncapital and related financing activities:
Interfund transfers (3,030) (3,030)
Connection fees 544,852 544,852
Grants received 35,000 35,000
Net cash provided by noncapital financing activities 541,822 35,000 576,822
Cash flows from capital and related financing activities:
Development impact fees 1,094,460 1,094,460
Acquisition of capital assets (2,572,380) (2,572,380)
Proceeds from loans and refunding bonds 2,530,784 2,530,784
Principal paid on long-term debt (3,660,703) (38,439) (3,699,142)
Payment to bond escrow agent (1,242,731) (1,242,731)
Interest on long-term debt (1,455,659) (1,455,659)
Net cash used for capital and related
financing activities (5,306,229) (38,439) (5,344,668)
Cash flows from investing activities:
Investment income 204,035 634 204,669
Net cash provided by investing activities 204,035 634 204,669
Net increase (decrease) in cash and cash equivalents 1,567,561 (10,045) 1,557,516 73,991
Cash and cash equivalents, beginning of year 22,843,523 299,844 23,143,367 731,889
Cash and cash equivalents, end of year 24,411,084$ 289,799$ 24,700,883$ 805,880$
Reconciliation of Operating Income (Loss) to
Net Cash Provided by (Used for) Operating Activities
Operating income (loss)2,194,765$ (89,640)$ 2,105,125$ 56,271$
Adjustments to reconcile operating income (loss)
to net cash provided by (used for) operating activities:
Depreciation and amortization 3,419,862 150,687 3,570,549
Change in assets and liabilities:
Accounts receivable (229,183) (71,934) (301,117) (75,068)
Prepaid items 133,999 133,999
Accounts payable 471,720 15,262 486,982 7,295
Claims payable 86,335
Accrued payroll and related benefits 26,166 (8,496) 17,670
Compensated absences payable
Deposits held for others 81,937 81,937
Pension items 28,667 (3,119) 25,548 (842)
Total adjustments 3,933,168 82,400 4,015,568 17,720
Net cash provided by (used for) operating activities 6,127,933$ (7,240)$ 6,120,693$ 73,991$
Non-cash capital and financing activities
Contribution of assets from developers 3,334,372$ 3,334,372$
Enterprise Funds
TOWN OF ORO VALLEY, ARIZONA
STATEMENT OF CASH FLOWS
PROPRIETARY FUNDS
FOR THE YEAR ENDED JUNE 30, 2016
The notes to the basic financial statements are an integral part of this statement.
TOWN OF ORO VALLEY, ARIZONA
NOTES TO FINANCIAL STATEMENTS
JUNE 30, 2016
NOTE 1 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
The financial statements of the Town of Oro Valley, Arizona (Town) have been prepared in
conformity with accounting principles generally accepted in the United States of America as
applied to government units. The Governmental Accounting Standards Board (GASB) is the
accepted standard-setting body for establishing governmental accounting and financial
reporting principles.
During the year ended June 30, 2016, the Town implemented the provisions of GASB Statement
No. 72, Fair Value Measurement and Application. This Statement addresses accounting and
financial reporting issues related to fair value measurements and establishes a hierarchy of
inputs to valuation techniques used to measure fair value. This Statement also enhances
accountability and transparency through revised note disclosures.
The more significant of the Town’s accounting policies are described below.
A. Reporting Entity
The Town is a municipal entity governed by an elected mayor and council. As required by
accounting principles generally accepted in the United States of America, these financial
statements present the Town and its component units, entities for which the Town is considered
to be financially accountable. Blended component units, although legally separate entities, are,
in substance, part of the Town’s operations and so data from these units are combined with data
of the Town, the primary government. The blended component units presented have a June 30
year end.
The financial reporting entity consists of a primary government and its component units. A
component unit is a legally separate entity that must be included in the reporting entity in
conformity with generally accepted accounting principles. The Town is a primary government
that has a separately elected governing body, is legally separate, and is fiscally independent of
other state or local governments. Furthermore, component units combined with the Town for
financial statement presentation purposes, and the Town, are not included in any other
governmental reporting entity. Consequently, the Town’s financial statements include the
funds of those organizational entities for which its elected governing body is financially
accountable.
Blended Component Unit – The financial reporting entity presented in these financial
statements consists of the Town and one blended component unit. This component unit,
discussed below, is included in the Town’s reporting entity because of the significance of its
operational relationship or financial relationship with the Town. The component unit is
governed by a board, substantially or wholly, comprised of the Town’s elected council.
Separate financial statements are not prepared for the component unit on a stand-alone basis.
TOWN OF ORO VALLEY, ARIZONA
NOTES TO FINANCIAL STATEMENTS
JUNE 30, 2016
NOTE 1 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
The Town of Oro Valley Municipal Property Corporation’s (MPC) Board of Directors consists
of the three members which are appointed by the Town of Oro Valley Town Council. The MPC,
a non-profit corporation incorporated under the laws of the State of Arizona, was originally
formed for the purpose of assisting the Town in obtaining financing for acquiring the Cañada
Hills and Rancho Vistoso water companies. The Town has a contractual obligation for the
repayment of the MPC’s Excise Tax Refunding Bonds, Series 2007. The activity of the 2007
MPC is reported in the applicable water enterprise and governmental funds. All related
receivables and payables between the Town and the MPC have been eliminated.
B. Government-Wide and Fund Financial Statements
The government-wide financial statements (i.e., the statement of net position and the statement
of activities) present financial information about the Town as a whole. The reported information
includes all of the activities of the Town and its component units. For the most part, the effect
of internal activity has been removed from these statements. These statements are to distinguish
between the governmental and business-type activities of the Town. Governmental activities
normally are supported by sales taxes and intergovernmental revenues, and are reported
separately from business-type activities, which rely to a significant extent on fees and charges
for support.
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.
Sales taxes, franchise taxes, unrestricted state shared revenues, investment income and other
items not included among program revenues are reported instead as general revenues.
Separate financial statements are provided for governmental funds and proprietary funds.
Major individual governmental funds and the major individual enterprise fund are reported as
separate columns in the fund financial statements.
TOWN OF ORO VALLEY, ARIZONA
NOTES TO FINANCIAL STATEMENTS
JUNE 30, 2016
NOTE 1 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
C. Measurement Focus, Basis of Accounting, and Financial Statement Presentation
Government-wide Financial Statements – The government-wide financial statements are
reported using the economic resources measurement focus and the accrual basis of accounting.
Revenues are recorded when earned and expenses are recorded when a liability is incurred,
regardless of the timing of related cash flows. Grants and similar items are recognized as
revenue as soon as all eligibility requirements imposed by the grantor or provider have been
met. As a general rule, the effect of internal activity has been eliminated from the government-
wide financial statements; however, the effects of interfund services provided and used between
functions are reported as expenses and program revenues at amounts approximating their
external exchange value.
Fund Financial Statements – 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 Town 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.
Sales taxes, franchise taxes, licenses and permits, charges for services, special assessments and
investment income associated with the current fiscal period are all considered to be susceptible
to accrual and have been recognized as revenues of the current fiscal period. Grants and similar
awards are recognized as revenue as soon as all eligibility requirements imposed by the grantor
or provider have been met. Miscellaneous revenue is not susceptible to accrual because
generally they are not measurable until received in cash. Grants and similar awards are
recognized as revenue as soon as all eligibility requirements imposed by the grantor or provider
have been met. Unearned revenue arises when resources are received by the Town before it has
legal claim to them, as when grant monies are received prior to meeting all eligibility
requirements imposed by the provider.
The Council adopts the budget at the fund level as a total amount of expenditures. Financial
control is administered by fund, with budgetary control for operating performance regulated at
the departmental level, e.g., finance, economic development, police, and parks and recreation.
The legal level of budgetary control (i.e. the level at which expenditures may not legally exceed
appropriations) is at the fund level.
TOWN OF ORO VALLEY, ARIZONA
NOTES TO FINANCIAL STATEMENTS
JUNE 30, 2016
NOTE 1 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
The focus of governmental fund financial statements is on major funds rather than reporting
funds by type. Each major fund is presented in a separate column. Non-major funds are
aggregated and presented in a single column.
The Town reports the following major governmental funds.
General Fund – This fund accounts for all financial resources of the Town, except those
required to be accounted for in other funds.
Community Center Fund – This fund accounts for the activity of the Oro Valley
Community and Recreation Center.
The Town reports the following major proprietary funds.
Water Fund – This fund accounts for the costs to operate, construct and finance the Town’s
water system.
Proprietary funds distinguish operating revenues and expenses from nonoperating 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 Town’s internal service fund are charges for health benefits
and charges to user departments for fleet maintenance services. The principal operating
revenues of the Town’s enterprise fund are charges to customers for water and stormwater
drainage services. Operating expenses for these funds include the cost of sales and services,
administrative expenses, depreciation, and amortization. All revenues and expenses not
meeting this definition are reported as nonoperating revenues and expenses.
D. Cash and Investments
For purposes of the Statement of Cash Flows, the Town considers all highly liquid investments
with a maturity of three months or less when purchased to be cash equivalents.
Arizona statute requires a pooled collateral program for public deposits and a Statewide
Collateral Pool Administrator (Administrator) in the State Treasurer’s Office. The purpose of
the pooled collateral program is to ensure that governmental entities’ public deposits placed in
participating depositories are secured with collateral of 102 percent of the public deposits, less
any applicable deposit insurance. An eligible depository may not retain or accept any public
deposit unless it has deposited the required collateral with a qualified escrow agent or the
Administrator. The Administrator manages the pooled collateral program, including reporting
on each depository’s compliance with the program.
TOWN OF ORO VALLEY, ARIZONA
NOTES TO FINANCIAL STATEMENTS
JUNE 30, 2016
NOTE 1 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
Nonparticipating interest-earning investment contracts are stated at cost. Money market
investments and participating interest investment contracts with a remaining maturity of one
year or less at time of purchase are stated at amortized cost. All other investments are stated at
fair value.
E. Investment Income
Investment income is composed of interest, dividends, and net changes in the fair value of
applicable investments.
F. Receivables and Payables
Activity between funds that is representative of lending/borrowing arrangements outstanding
at the end of the fiscal year is referred to as either “due to/from other funds” (i.e., the current
portion of interfund loans) or “advances to/from other funds” (i.e., the non-current portion of
interfund loans). All other outstanding balances between funds are reported as “due to/from
other funds.” Interfund balances between governmental funds are eliminated on the Statement
of Net Position
All trade receivables are shown net of an allowance for uncollectibles.
G. Inventory
All inventories are valued at cost using the first-in/first-out (FIFO) method. Inventories consist
of expendable supplies held for consumption. Inventories are recorded as expenses when
consumed on the government-wide financial statements and the fund financial statements
H. Prepaid Items
Certain payments to vendors reflect costs applicable to future accounting periods and are
recorded as prepaid items in the government-wide and fund financial statements. Prepaid items
are recorded as expenses when consumed in the government-wide financial statements and the
fund financial statements.
TOWN OF ORO VALLEY, ARIZONA
NOTES TO FINANCIAL STATEMENTS
JUNE 30, 2016
NOTE 1 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
I. Capital Assets
Capital assets, which include property, plant, and equipment, are reported in the applicable
governmental or business-type activities columns in the government-wide financial statements.
Capital assets are defined by the Town as assets with an initial, individual cost of $5,000 or
more and an estimated useful life of more than one year. Such assets are recorded at historical
cost or estimated historical cost if actual historical cost is not available. Donated capital assets
are recorded at estimated fair market value at the date of donation.
The costs of normal maintenance and repairs that do not add to the value of the asset or
materially extend the life of the asset are not capitalized.
Major outlays for capital assets and improvements are capitalized as projects are constructed.
Interest incurred during the construction phase of capital assets of business-type activities is
included as part of the capitalized value of the assets constructed.
Certain capital assets of the Town are depreciated using the straight line method over the
following estimated useful lives:
Assets Years
Buildings 50
Improvements other than buildings 20-30
Infrastructure 20-50
Vehicles 4-6
Machinery and equipment 7-20
J. Deferred Outflows/Inflows of Resources
In addition to assets, the statement of financial position may report a separate section for
deferred outflows of resources. This separate financial statement element, deferred outflows
of resources, represents a consumption of net position that applies to a future period and so
will not be recognized as an outflow of resources (expense/expenditure) until then.
In addition to liabilities, the statement of financial position may report a separate section for
deferred inflows of resources. This separate financial statement element, deferred inflows of
resources, represents an acquisition of net position that applies to a future period and so will
not be recognized as an inflow of resources (revenue) until that time.
TOWN OF ORO VALLEY, ARIZONA
NOTES TO FINANCIAL STATEMENTS
JUNE 30, 2016
NOTE 1 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
K. Compensated Absences
The Town’s employee annual and sick leave policies generally provide for granting annual and
sick leave with pay. Full-time employees accrue annual leave based on the number of years
employed. Employees who terminate employment shall be paid in a lump sum. Full-time
employees accumulate sick leave at the rate of one work day per month. Part-time employees
whose normal week is twenty hours or more receive sick leave at half the rate of full-time
employees. Once an employee has exceeded 480 hours of accrued sick leave, one half of the
sick leave balance in excess of the 480 hours shall be paid to the employee upon separation
from employment. The current and long-term liabilities, including related benefits, for
accumulated vacation and sick leave are reported on the government-wide financial statements.
A liability for these amounts, including related benefits, is reported in governmental funds only
if they have matured, for example, as a result of employee leave, resignations and retirements.
Generally, resources from the General Fund are used to pay for compensated absences.
L. Pensions
For purposes of measuring the net pension liability, deferred outflows of resources and deferred
inflows of resources related to pensions, and pension expense, information about the pension
plan’s fiduciary net position and additions to/deductions from the plan’s fiduciary net position
have been determined on the same basis as they are reported by the plan. For this purpose,
benefit payments (including refunds of employee contributions) are recognized when due and
payable in accordance with the benefit terms. Investments are reported at fair value.
M. Long-term Obligations
In the government-wide financial statements and proprietary fund financial statements, long-
term debt and other long-term obligations are reported as liabilities in the applicable business-
type activities and proprietary fund type statement of net position.
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.
TOWN OF ORO VALLEY, ARIZONA
NOTES TO FINANCIAL STATEMENTS
JUNE 30, 2016
NOTE 1 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
N. Interfund Activity
Flows of cash from one fund to another without a requirement for repayment are reported as
interfund transfers. Interfund transfers between governmental funds are eliminated in the
Statement of Activities. Interfund transfers in the fund statements are reported as other
financing sources/uses in governmental funds and after nonoperating revenues/expenses in
proprietary funds.
O. Net Position Flow Assumption
In the government-wide and proprietary fund financial statements the Town applies restricted
resources first when outlays are incurred for purposes for which either restricted or unrestricted
amounts are available.
P. Estimates
The preparation of the financial statements in conformity with accounting principles generally
accepted in the United States of America requires management to make estimates and
assumptions that affect the amounts reported in the financial statements and accompanying
notes. Actual results may differ from those estimates.
NOTE 2 – STEWARDSHIP, COMPLIANCE AND ACCOUNTABILITY
Excess Expenditures Over Budget – At year end, the Town had expenditures in funds that
exceeded the budget, however, this does not constitute a violation of any legal provisions.
Individual Deficit Fund Balance – At year end, the Federal Seizures and Forfeitures Fund, a
non-major governmental fund reported a deficit in fund balance of $29,198. The deficit arose
because of operations during the year. Additional revenues received in fiscal year 2016-17 are
expected to eliminate the deficit.
NOTE 3 – FUND BALANCE CLASSIFICATIONS
Fund balances of the governmental funds are reported separately within classifications based
on a hierarchy of the constraints placed on the use of those resources. The classifications are
based on the relative strength of the constraints that control how the specific amounts can be
spent. The classifications are nonspendable, restricted, and unrestricted, which includes
committed, assigned, and unassigned fund balance classifications.
Nonspendable. The nonspendable fund balance classification includes amounts that cannot
be spent because they are not in spendable form, or legally or contractually required to be
maintained intact.
TOWN OF ORO VALLEY, ARIZONA
NOTES TO FINANCIAL STATEMENTS
JUNE 30, 2016
NOTE 3 – FUND BALANCE CLASSIFICATIONS
Restricted. Fund balance is reported as restricted when constraints placed on the use of
resources are either externally imposed by creditors (such as through debt covenants), grantors,
contributors, or laws or regulations of other governments or is imposed by law through
constitutional provisions or enabling legislation.
Committed. The committed fund balance classification includes amounts that can be used only
for the specific purposes imposed by formal action of the Town Council through the approval
of a Town resolution. Those committed amounts cannot be used for any other purpose unless
the Town Council removes or changes the specified use by taking the same type of action it
employed to previously commit those amounts. The committed fund balance reported in the
Bed Tax Fund is to be used for local economic development purposes. The committed fund
balance reported in the Highway User Revenue Fund is to be used for roadway maintenance
and preservation purposes. The committed fund balance reported in the Townwide Facilities
Projects Fund is used for improvements to Town parks. The committed fund balance reported
in the Community Center Fund is used for the culture and recreation activity of the Community
Center.
Assigned. Amounts in the assigned fund balance classification are intended to be used by the
Town for specific purposes but do not meet the criteria to be classified as restricted or
committed. In governmental funds other than the General Fund, assigned fund balance
represents the remaining amount that is not restricted or committed. In the General Fund,
assigned amounts represent intended uses established by the Town Council or a management
official delegated that authority by the formal Town Council action. This authorization has
been given to the Town Manager through the approval of Resolution No. (R)11-30, which
amended the Town Financial and Budgetary Policies. The assigned fund balance in the
General Fund is set aside for the payout of compensated absences and for unemployment
compensation claims. The assigned fund balance in the General Government CIP Fund is to
be used for governmental capital asset projects.
Unassigned. Unassigned fund balance is the residual classification for the General Fund and
includes all spendable amounts not contained in the other classifications. In other governmental
funds, the unassigned classification is used only to report a deficit balance resulting from
overspending for specific purposes for which amounts had be restricted, committed, or
assigned.
The Town applies restricted resources first when outlays are incurred for purposes for which
either restricted or unrestricted (committed, assigned, and unassigned) amounts are available.
Similarly, within unrestricted fund balance, committed amounts are reduced first followed by
assigned, and then unassigned amounts when expenditures are incurred for purposes for which
amounts in any of the unrestricted fund balance classifications could be used.
TOWN OF ORO VALLEY, ARIZONA
NOTES TO FINANCIAL STATEMENTS
JUNE 30, 2016
NOTE 3 – FUND BALANCE CLASSIFICATIONS
The table below provides detail of the major components of the Town’s fund balance
classifications at year end.
General
Fund
Community
Center Fund
Non-Major
Governmental
Funds
Fund Balances:
Nonspendable:
Inventory $ $ 112,788 $
Prepaid items 97,269 14,812
Restricted:
Debt service 69,454
Capital projects 3,876,918
Public safety 85,551
Committed 34,145 2,583,711
Assigned:
Compensated absences 1,244,471
Unemployment claims 197,391
Townwide capital 1,340,991
Unassigned 8,985,422 (29,198)
Total fund balances $ 10,524,553 $ 161,745 $ 7,927,427
NOTE 4 – CASH AND INVESTMENTS
A.R.S. authorize the Town to invest public monies in obligations of the U.S. Government and
its agencies, obligations of the State and certain local government subdivisions, interest-
bearing savings accounts and certificates of deposit, collateralized repurchase agreements,
certain obligations of U.S. corporations, and certain other securities. The statutes do not include
any requirements for credit risk, custodial credit risk, concentration of credit risk, interest rate
risk, or foreign currency risk for the Town’s investments.
The State Treasurer’s pools are external investment pools, the Local Government Investment
Pool (Pool 5) and Local Government Investment Pool – Government (Pool 7), with no
regulatory oversight. The pools are not required to register (and are not registered) with the
Securities and Exchange Commission. The activity and performance of the pools are reviewed
monthly by the State Board of Investment. The fair value of each participant’s position in the
State Treasurer investment pools approximates the value of the participant’s shares in the pool
and the participants’ shares are not identified with specific investments. No regulatory
oversight is provided for the County Treasurer’s investment pool and that pool’s structure does
not provide for shares. Participants in the pool are not required to categorize the value of shares
in accordance with the fair value hierarchy.
TOWN OF ORO VALLEY, ARIZONA
NOTES TO FINANCIAL STATEMENTS
JUNE 30, 2016
NOTE 4 – CASH AND INVESTMENTS
The County Treasurer’s pool is an external investment pool with no regulatory oversight. The
pool is not required to register (and is not registered) with the Securities and Exchange
Commission. The fair value of each participants’ position in the County Treasurer investment
pool approximates the value of the participants’ shares in the pool and the participants’ shares
are not identified with specific investments. Participants in the pool are not required to
categorize the value of shares in accordance with the fair value hierarchy. Participants in the
pool are not required to categorize the value of shares in accordance with the fair value
hierarchy
Custodial Credit Risk – Deposits. Custodial Credit risk is the risk that in the event of bank
failure the Town’s deposits may not be returned to the Town. The Town does not have a deposit
policy for custodial credit risk. At year end, the carrying value of the Town’s deposits was
$3,401,964 and the bank balance was $2,243,642.
Fair Value Measurements. The District categorizes its fair value measurements within the fair
value hierarchy established by generally accepted accounting principles. The hierarchy is
based on the valuation inputs used to measure the fair value of the asset.
Level 1 inputs are quoted prices in active markets for identical assets
Level 2 inputs are significant other observable inputs
Level 3 inputs are significant unobservable inputs
All investments in which the fair value hierarchy is applicable are measured at fair value on a
recurring basis. At year end, the Town’s investments consisted of the following:
Investments Maturities
(in Years)
Investment Type Category Fair Value Less than 1 1-5
Money Market - U.S. Treasuries Level 2 $ 4,351,956 $ 4,351,956 $
Municipal Securities Level 2 230,000 230,000
Commercial Paper Level 2 2,489,276 2,489,276
U.S. Treasury Bonds/Notes Level 2 12,342,627 12,342,276
U.S. Agencies Bonds/Notes Level 2 16,110,537 2,475,548 13,634,989
Supranational Agency Bonds Level 2 491,678 491,678
$ 9,546,780 $ 26,468,943
County Treasurer’s investment pool Not Applicable 181,119 203 days average maturities
State Treasurer’s investment pool 5 Not Applicable 6,856,108 22 days average maturities
Total $43,053,301
TOWN OF ORO VALLEY, ARIZONA
NOTES TO FINANCIAL STATEMENTS
JUNE 30, 2016
NOTE 4 – CASH AND INVESTMENTS
Interest Rate Risk. The Town has implemented an investment policy that will minimize
interest rate risk, which is the risk that the market value of securities in the portfolio will fall
due to changes in market interest rates by the following.
1. Structuring the investment portfolio so that securities mature to meet cash requirements
for ongoing operations, thereby avoiding the need to sell securities on the open market
prior to maturity; and
2. Investing operating funds primarily in shorter-term securities, money market mutual
funds, or similar investment pools limiting the average maturity in the portfolio in
accordance with this policy.
Credit Risk. The Town has implemented an investment policy that will minimize credit risk,
which is the risk of loss due to the failure of the security or backer by the following:
1. Limiting investments to the types of securities listed in Section 6 of this investment
policy;
2. Pre-qualifying financial institutions, broker/dealers, intermediaries, and advisers with
which the Town will do business in accordance with Section 5; and
3. Diversifying the investment portfolio so that the impact of potential losses from any
one type of security or from any one individual issuer will be minimized.
As of year end, the Town’s investment in the State and County Treasurers’ investment pools
did not receive a credit quality rating from a national rating agency. The State Treasurer’s
investment pool 5 was rated AAAf/S1+ by Standard and Poor’s at year end. The Town’s
investments in U.S. agencies, municipal bonds, and commercial paper were rated AA+, AAA,
and A-1 respectively, by Standard and Poor’s.
Custodial Credit Risk – Investments. The Town’s investment in the State and County
Treasurer’s investment pools represents a proportionate interest in the pool’s portfolio;
however, the Town’s portion is not identified with specific investments and is not subject to
custodial credit risk.
Concentration of Credit Risk. The Town places no limit on the amount the Town may invest
in any one issuer. More than five percent of the Town’s investments are in Federal Home Loan
Mortgage Corporation notes, which make up five percent of the Town’s total investments.
TOWN OF ORO VALLEY, ARIZONA
NOTES TO FINANCIAL STATEMENTS
JUNE 30, 2016
NOTE 5 – RECEIVABLES
Receivable balances, net of allowance for uncollectibles, have been disaggregated by type and
presented separately in the financial statements with the exception of intergovernmental
receivables. Intergovernmental receivables, net of allowance for uncollectibles, as of year end
for the Town’s individual major fund in the aggregate, were as follows:
General
Fund
Non-Major
Governmental
Funds
Intergovernmental receivables:
Due from federal government $ 102,988 $
Due from state government 404,516 283,488
Due from other governments 648,482
Net intergovernmental receivables $ 507,504 $ 931,970
NOTE 6 – CAPITAL ASSETS
A summary of capital asset activity for the current fiscal year follows:
Governmental Activities
Beginning
Balance Increase Decrease
Ending
Balance
Capital assets, not being depreciated:
Land $ 19,253,801 $ 265,000 $ $ 19,518,801
Construction in progress 3,414,286 3,590,349 933,752 6,070,883
Total capital assets, not being depreciated 22,668,087 3,855,349 933,752 25,589,684
Capital assets, being depreciated:
Infrastructure 166,966,180 1,986,526 168,952,706
Buildings and improvements 28,715,296 1,377,604 30,092,900
Machinery, equipment, and vehicles 14,436,773 2,173,822 487,990 16,122,605
Total capital assets being depreciated 210,118,249 5,537,952 487,990 215,168,211
Less accumulated depreciation for:
Infrastructure (73,798,455) (6,522,168) (80,320,623)
Buildings and improvements (5,652,141) (780,751) (6,432,892)
Machinery, equipment, and vehicles (9,266,255) (1,712,633) (450,085) (10,528,803)
Total accumulated depreciation (88,716,851) (9,015,552) (450,085) (97,282,318)
Total capital assets, being depreciated, net 121,401,398 (3,477,600) 37,905 117,885,893
Governmental activities capital assets, net $ 144,069,485 $ 377,749 $ 971,657 $ 143,475,577
TOWN OF ORO VALLEY, ARIZONA
NOTES TO FINANCIAL STATEMENTS
JUNE 30, 2016
NOTE 6 – CAPITAL ASSETS
Business-Type Activities
Beginning
Balance Increase Decrease
Ending
Balance
Capital assets, not being depreciated:
Land $ 2,410,660 $ $ $ 2,410,660
Water rights 8,534,490 8,534,490
Construction in progress 457,559 674,312 257,425 874,446
Total capital assets, not being depreciated 11,402,709 674,312 257,425 11,819,596
Capital assets, being depreciated:
Water system 120,915,619 5,145,645 126,061,264
Stormwater system 2,846,177 2,846,177
Equipment and vehicles 5,054,492 197,858 26,976 5,225,374
Total capital assets being depreciated 128,816,288 5,343,503 26,976 134,132,815
Less accumulated depreciation for:
Water system (35,785,455) (3,088,890)(38,874,345)
Stormwater system (311,350) (60,626)(371,976)
Equipment and vehicles (3,291,312) (274,668) (26,976) (3,539,004)
Total accumulated depreciation (39,388,117) (3,424,184) (26,976) (42,785,325)
Total capital assets, being depreciated, net 89,428,171 1,919,319 91,347,490
Business-type activities capital assets, net $ 100,830,880 $ 2,593,631 $ 257,425 $ 103,167,086
Depreciation expense was charged to functions/programs as follows:
Governmental activities:
General government $1,057,306
Public Safety 705,740
Highways and streets 6,580,978
Culture and recreation 671,528
Total depreciation expense – governmental activities $9,015,552
Business-type activities:
Water $3,273,497
Stormwater 150,687
Total depreciation expense – business-type activities $3,424,184
Construction Commitments – As of year end, the Town was involved in several construction
projects. The estimated cost to complete the construction projects is $12.4 million.
TOWN OF ORO VALLEY, ARIZONA
NOTES TO FINANCIAL STATEMENTS
JUNE 30, 2016
NOTE 7 – LOANS PAYABLE
The Town has loans from the Water Infrastructure Finance Authority of Arizona for water
system projects. The loans payable at current fiscal year end are presented below.
Business-type activities:
Interest Rate
(Including
Fees)
Remaining
Maturities
Outstanding
Principal
June 30, 2016
Due Within
One Year
WIFA Loan, 2007 2.04% 7/1/16-27 $ 3,029,942 $ 213,283
WIFA Loan, 2009 2.75% 7/1/16-29 1,682,838 97,457
WIFA Loan, 2014 2.65% 7/1/16-25 4,167,127 290,582
Total $ 8,879,907 $ 601,322
NOTE 7 – LOANS PAYABLE
Principal and interest payments on the business-type activities loans payable at June 30, 2016
are summarized as follows:
Business-type Activities
Year ending June 30: Principal Interest
2017 $ 601,322 $ 259,759
2018 599,562 242,691
2019 617,936 224,029
2020 636,882 205,056
2021 656,421 185,216
2022-26 3,597,212 606,045
2027-30 2,170,572 96,097
Total $ 8,879,907 $ 1,818,893
TOWN OF ORO VALLEY, ARIZONA
NOTES TO FINANCIAL STATEMENTS
JUNE 30, 2016
NOTE 8 – BONDS PAYABLE
Bonds payable at year end, consisted of the following outstanding revenue and refunding
bonds. The bonds are both callable and noncallable with interest payable semiannually. Taxes,
water revenues, and impact fees are used to pay bonded debt.
Purpose
Original
Amount
Issued
Interest
Rates
Remaining
Maturities
Outstanding
Principal
June 30, 2016
Due Within
One Year
Governmental activities:
Refunding Revenue Bonds, 2007 $ 1,389,180 4.25-5.00% 7/1/16-26 $ 1,199,640 $ 52,260
Excise Tax Revenue Obligations, 2010 2,445,000 3.72-6.59% 7/1/16-27 1,780,000 135,000
Revenue Bonds, 2012 2,580,000 2.00-4.00% 7/1/54-27 2,180,000 145,000
Refunding Excise Tax Revenue
Obligations, 2015 2,529,250 1.91% 7/1/16-25 2,529,250 2,680
Total $ 7,688,890 $ 334,940
Annual debt service requirements to maturity on revenue and refunding bonds for
governmental activities at year end are summarized as follows:
Governmental Activities
Year ending June 30: Principal Interest
2017 $ 334,940 $ 281,475
2018 598,890 264,883
2019 622,930 243,924
2020 636,410 221,969
2021 766,870 196,360
2022-26 3,816,750 571,499
2027-28 912,100 41,007
Total $ 7,688,890 $ 1,821,117
Purpose
Original
Amount
Issued
Interest
Rates
Remaining
Maturities
Outstanding
Principal
June 30, 2016
Due Within
One Year
Business-type activities:
Refunding Revenue Bonds, 2007 $ 16,420,820 4.25-5.00% 7/1/16-26 $ 14,180,360 $ 617,740
Refunding Revenue Bonds, 2012 16,595,000 2.00-5.00% 7/1/16-28 13,565,000 1,470,000
Refunding Revenue Bonds, 2013 6,355,000 1.45% 7/1/16-19 3,960,000 965,000
Refunding Revenue Bonds, 2015 1,245,750 1.91% 7/1/16-25 1,245,750 1,320
Total $ 32,951,110 $ 3,054,060
TOWN OF ORO VALLEY, ARIZONA
NOTES TO FINANCIAL STATEMENTS
JUNE 30, 2016
NOTE 8 – BONDS PAYABLE
Annual debt service requirements to maturity revenue and refunding bonds for business-type
activities at year end are summarized as follows:
Business-type Activities
Year ending June 30: Principal Interest
2017 $ 3,054,060 $ 1,212,651
2018 3,253,110 1,130,933
2019 3,344,070 1,027,858
2020 3,458,590 913,219
2021 3,902,130 767,629
2022-26 13,091,250 1,769,135
2027-29 2,847,900 145,992
Total $ 32,951,110 $ 6,967,417
During the year ended June 30, 2016, the Town issued $3,775,000 in refunding bonds (allocated to
governmental and business-type activities debt), with an effective interest rate of 1.91 percent, to advance
refund $3,715,000 of outstanding Excise Tax Revenue Refunding Bonds, Series 2005, with an average
interest rate of 4.12 percent. The net proceeds of $3,765,852, which includes a Town contribution of
$75,647, (after payment of $84,795 of issuance fees) were used to purchase U.S. government securities.
Those securities were deposited in an irrevocable trust with an escrow agent, to provide for all future debt
service payments of the refunded bonds. As a result, the refunded general obligation bonds are
considered to be defeased, and the liability for those bonds has been removed from the government-wide
financial statements. The reacquisition price exceeded the net carrying amount of the old debt by $50,852.
This advance refunding was undertaken to reduce total debt service payments over the next 10 fiscal
years by $337,952 and resulted in an economic gain of $334,650.
Pledged revenues – governmental activities. The Town has pledged future sales (excise) tax revenues
to repay outstanding revenue bonds and refunding revenue bonds of $7.7 million as of June 30, 2016.
Proceeds from the original bond issuances, including those subsequently refunded, provided financing
for land acquisition and facility construction. The bonds are paid solely from the Town’s sales taxes and
are payable through 2028. Total annual principal and interest payments for all sales tax revenue bonds
are expected to require less than seven percent of gross revenues. The total principal and interest to be
paid on the bonds is $9.5 million. The current total sales tax revenues were $17.0 million and the total
principal and interest paid on the bonds was $879,018, or five percent of gross revenues.
Pledged revenues – business-type activities. The Town has pledged future water revenues to repay
outstanding revenue bonds and refunding revenue bonds of $33.0 million as of
June 30, 2016. Proceeds from the original bond issuances, including those subsequently refunded,
provided financing for the construction and improvements to the Town’s water systems and
infrastructure. The bonds are paid solely from water utility revenues and are payable through 2029. Total
annual principal and interest payments for all water revenue bond issuances are expected to require
approximately 25 percent of gross revenues. The total principal and interest to be paid on the bonds is
$33.0 million. The current total customer gross revenues were $16.7 million and the total principal and
interest paid on the bonds was $4.3 million or 26 percent of gross revenues.
TOWN OF ORO VALLEY, ARIZONA
NOTES TO FINANCIAL STATEMENTS
JUNE 30, 2016
NOTE 9 – SPECIAL ASSESSMENT BONDS
Special assessment bonds at year end consisted of the following outstanding bonds. The bonds
are both callable and noncallable with interest payable semiannually. Special assessments
from the Oracle Road Debt Service Fund are used to pay bonded debt.
Purpose
Original
Amount
Issued
Interest
Rates
Remaining
Maturities
Outstanding
Principal
June 30, 2016
Due
Within
One Year
Governmental activities:
Special assessments debt $3,945,000 4.30-5.00% 1/1/16-21 $ 780,000 $ 143,000
Total $ 780,000 $ 143,000
Annual debt service requirements to maturity on special assessment bonds at year end are
summarized as follows:
Governmental Activities
Year ending June 30: Principal Interest
2017 $ 143,000 $ 33,280
2018 148,000 26,297
2019 158,000 19,256
2020 163,000 11,793
2021 168,000 3,976
Total $ 780,000 $ 94,602
NOTE 10 – OBLIGATIONS UNDER CAPITAL LEASES
The governmental activities of the Town have acquired police motorcycles and community center
utility vehicles under the provisions of long-term lease agreements classified as capital leases. The
lease agreements qualify as capital leases for accounting purposes and, therefore, have been
recorded at the present value of their future minimum lease payments as of the inception date.
Revenues from the General Fund and Community Center Fund are used to pay the capital lease
obligations. Amortization of assets recorded under capital leases is included with depreciation
expense.
Governmental
Activities
Asset:
Vehicles $ 1,341,558
Less: Accumulated depreciation 231,841
Total $ 1,109,717
TOWN OF ORO VALLEY, ARIZONA
NOTES TO FINANCIAL STATEMENTS
JUNE 30, 2016
NOTE 10 – OBLIGATIONS UNDER CAPITAL LEASES
The future minimum lease obligations and the net present value of these minimum lease
payments at year end were as follows:
Year Ending June 30:
Governmental
Activities
2017 $ 277,211
2018 277,212
2019 216,133
2020 213,008
2021 46,471
Total minimum lease payments 1,030,035
Less: amount representing interest 63,343
Present value of minimum lease payments $ 966,692
Due within one year $ 248,020
The business-type activities of the Town have acquired a wheel loader under the provisions of
a long-term lease agreement classified as a capital lease. The lease agreement qualifies as a
capital lease for accounting purposes and, therefore, has been recorded at the present value of
its future minimum lease payments as of the inception date. Revenues from the Stormwater
Fund are used to pay the capital lease obligations. Amortization of assets recorded under capital
leases is included with depreciation expense.
The assets capitalized and acquired through capital leases are as follows:
Business-type
Activities
Asset:
Machinery, equipment, and vehicles $ 234,362
Less: Accumulated depreciation 37,742
Total $ 196,620
TOWN OF ORO VALLEY, ARIZONA
NOTES TO FINANCIAL STATEMENTS
JUNE 30, 2016
NOTE 10 – OBLIGATIONS UNDER CAPITAL LEASES
The future minimum lease obligations and the net present value of these minimum lease
payments at year end were as follows:
Year Ending June 30:
Business-type
Activities
2017 $ 42,055
2018 42,055
Total minimum lease payments 84,110
Less: amount representing interest 3,687
Present value of minimum lease payments $ 80,423
Due within one year $ 41,848
NOTE 11 – CHANGES IN LONG-TERM LIABILITIES
Long-term liability activity for the current fiscal year was as follows:
Beginning
Balance Additions Reductions
Ending
Balance
Due Within
One Year
Governmental activities:
Revenue bonds payable $ 8,179,610 $ 2,529,250 $ 3,019,970 $ 7,688,890 $ 334,940
Deferred bond premium 36,063 8,315 27,748
Total bonds payable 8,215,673 2,529,250 3,028,285 7,716,638 334,940
Special assessments payable 925,000 145,000 780,000 143,000
Note payable 1,000,000 300,000 700,000 350,000
Capital leases payable 128,594 1,043,214 205,116 966,692 248,020
Net pension liability 27,078,940 3,603,758
30,682,698
Compensated absences payable 2,024,707 1,487,584 1,713,487 1,798,804 1,403,069
Governmental activity long-term
liabilities $ 39,372,914 $ 8,663,806 $ 5,391,888
$ 42,644,832 $ 2,479,029
TOWN OF ORO VALLEY, ARIZONA
NOTES TO FINANCIAL STATEMENTS
JUNE 30, 2016
NOTE 11 – CHANGES IN LONG-TERM LIABILITIES
Beginning
Balance Additions Reductions
Ending
Balance
Due Within
One Year
Business-type activities:
Revenue bonds payable $ 35,985,390 $ 1,245,750 $ 4,280,030 $ 32,951,110 $ 3,054,060
Deferred bond premium 1,698,415 131,878 1,566,537
Total bonds payable 37,683,805 1,245,750 4,411,908 34,517,647 3,054,060
Loan payable 8,169,765 1,293,678 583,536 8,879,907 601,322
Capital leases payable 118,862 38,439 80,423 41,848
Net pension liability 3,498,046 403,185 3,901,231
Compensated absences payable 293,587 262,163 247,639 308,111 203,353
Business-type activities long-term
liabilities $ 49,764,065 $ 3,204,776 $ 5,281,522 $ 47,687,319 $ 3,900,583
NOTE 12 – INTERFUND RECEIVABLES, PAYABLES, AND TRANSFERS
At year end, interfund balances were as follows:
Due to/from other funds: At year end, the Federal Seizures and Forfeitures Fund, a non-major
governmental fund, had a negative cash balance of $29,198. Negative cash on deposit was
reduced by interfund borrowing with the General Fund. All interfund balances are expected
to be paid within one year.
Interfund transfers:
Transfers in
Transfers out
General
Fund
Non-Major
Governmental
Funds Total
General Fund $ $ 1,226,086 $ 1,226,086
Non-Major Governmental Funds 185,000 457,910 642,910
Water Fund 3,030 3,030
Total $ 185,000 $ 1,687,026 $ 1,872,026
Transfers were made from the General, Bed Tax, and Water Funds to the Municipal Debt
Service Fund for debt service. In addition, transfers were made from the General Fund to the
General Government CIP Fund to fund capital projects for the upcoming fiscal year, 2016-17.
Finally, transfers were made from the Bed Tax Fund to the General Fund to subsidize the
operating costs related to the Aquatics Center.
TOWN OF ORO VALLEY, ARIZONA
NOTES TO FINANCIAL STATEMENTS
JUNE 30, 2016
NOTE 13 – CONTINGENT LIABILITIES
Compliance – Amounts received or receivable from grantor agencies are subject to audit and
adjustment by grantor agencies, principally the federal government. Any disallowed claims,
including amounts already collected, may constitute a liability of the applicable funds. The
amount, if any, of expenditures/expenses that may be disallowed by the grantor cannot be
determined at this time, although the Town expects such amounts, if any, to be immaterial.
NOTE 14 – RISK MANAGEMENT
The Town is exposed to various risks of loss related to torts; theft of, damage to, and destruction
of assets; errors and omissions; injuries to employees; and natural disasters.
The Town’s insurance protection is provided by the Arizona Municipal Risk Retention Pool, of
which the Town is a participating member. The limit for basic coverage is for $2,000,000 per
occurrence on a claims made basis. Excess coverage is for an additional $10,000,000 per
occurrence on a follow form, claims made basis. The aggregate limit is also $10,000,000. No
significant reduction in insurance coverage occurred during the year and no settlements
exceeded insurance coverage during any of the past three fiscal years.
The Arizona Municipal Risk Retention Pool is structured such that member premiums are based
on an actuarial review that will provide adequate reserves to allow the Pool to meet its expected
financial obligations. The Pool has the authority to assess its members’ additional premiums
should reserves and annual premiums be insufficient to meet the Pool’s obligations.
The Town is insured by Arizona Municipal Workers Compensation Pool for potential worker
related accidents.
The Town has established a Self Insurance Fund to account for and finance its employee health
benefits program. The activity is reported in an internal service fund in these financial
statements. Under this program, the Fund provides coverage for up to a maximum of $125,000
for each claim, not to exceed an annual aggregate of $2,000,000. The Fund purchases
commercial insurance for claims in excess of this coverage. Settled claims have not exceeded
this coverage for the past three fiscal years.
TOWN OF ORO VALLEY, ARIZONA
NOTES TO FINANCIAL STATEMENTS
JUNE 30, 2016
NOTE 14 – RISK MANAGEMENT
The Town limits its exposure through specific and aggregate stop-loss coverage. All claims
handling procedures are performed by a third-party claims administrator. Reported unpaid
claims, as well as incurred but not reported claims, have been accrued as a liability based upon
monthly claims lag summary reports. These claims are expected to be fully paid within one
year of the financial statement date.
Claims
Payable
Beginning of
Year
Current Year
Claims and
Changes in
Estimates
Claim
Payments
Claims
Payable at
End of Year
2015-16 $ 162,701 $ 2,513,124 $ 2,426,789 $ 249,036
2014-15 95,555 1,951,936 1,884,790 162,701
NOTE 15 – PENSIONS AND OTHER POSTEMPLOYMENT BENEFITS
The Town contributes to the pension plans described below. The plans are component units of
the State of Arizona.
The Town reported $2.6 million of pension expenditures in the governmental funds and
$270,078 in enterprise funds related to all pension plans to which it contributes.
A. Arizona State Retirement System
Plan Description. Town employees not covered by the other pension plans described after this
section participate in the Arizona State Retirement System (ASRS). The ASRS administers a
cost-sharing multiple-employer defined benefit pension plan, a cost-sharing multiple-employer
defined benefit health insurance premium benefit (OPEB) plan, and a cost-sharing multiple-
employer defined benefit long-term disability (OPEB) plan. The Arizona State Retirement
System Board governs the ASRS according to the provisions of A.R.S. Title 38, Chapter 5,
Articles 2 and 2.1. The ASRS issues a publicly available financial report that includes its
financial statements and required supplementary information. The report is available on the
ASRS website at www.azasrs.gov.
TOWN OF ORO VALLEY, ARIZONA
NOTES TO FINANCIAL STATEMENTS
JUNE 30, 2016
NOTE 15 – PENSIONS AND OTHER POSTEMPLOYMENT BENEFITS
Benefits Provided. The ASRS provides retirement, health insurance premium supplement,
long-term disability, and survivor benefits. State statute establishes benefit terms. Retirement
benefits are calculated on the basis of age, average monthly compensation, and service credit
as follows:
Retirement Initial
Membership Date:
Before July 1, 2011 On or After July 1, 2011
Years of service and
age required to
receive benefit
Sum of years and age equals 80
10 years age 62
5 years age 50*
Any years age 65
30 years age 55
25 years age 60
10 years age 62
5 years age 50*
Any years age 65
Final average salary is
based on
Highest 36 months of last
120 months
Highest 60 months of last
120 months
Benefit percent per
year of service
2.1% to 2.3% 2.1% to 2.3%
*With actuarially reduced benefits
Retirement benefits for members who joined the ASRS prior to September 13, 2013, are
subject to automatic cost-of-living adjustments based on excess investment earnings. Members
with a membership date on or after September 13, 2013, are not eligible for cost-of-living
adjustments. Survivor benefits are payable upon a member’s death. For retired members, the
survivor benefit is determined by the retirement benefit option chosen. For all other members,
the beneficiary is entitled to the member’s account balance that includes the member’s
contributions and employer’s contributions, plus interest earned.
Contributions. In accordance with state statutes, annual actuarial valuations determine active
member and employer contribution requirements. The combined active member and employer
contribution rates are expected to finance the costs of benefits employees earn during the year,
with an additional amount to finance any unfunded accrued liability. For the current fiscal year,
active ASRS members were required by statute to contribute at the actuarially determined rate
of 11.47 percent (11.35 percent for retirement and 0.12 percent for long-term disability) of the
members’ annual covered payroll, and the Town was required by statute to contribute at the
actuarially determined rate of 11.47 percent (10.85 percent for retirement, 0.50 percent for
health insurance premium benefit, and 0.12 percent for long-term disability) of the members’
annual covered payroll. The Town’s contributions to the pension plan for the year ended
June 30, 2016 were $1.3 million.
TOWN OF ORO VALLEY, ARIZONA
NOTES TO FINANCIAL STATEMENTS
JUNE 30, 2016
NOTE 15 – PENSIONS AND OTHER POSTEMPLOYMENT BENEFITS
The Town’s contributions for the current and two preceding years for the Arizona State
Retirement System OPEB, all of which were equal to the required contributions, were as
follows:
Health Benefit
Supplement
Fund
Long-Term
Disability
Fund
Year ending June 30:
2016 $ 59,288 $ 14,229
2015 65,413 13,304
2014 61,821 24,728
Pension Liability. At June 30, 2016, the Town reported a liability of $18.6 million for its
proportionate share of the net pension liability of the ASRS. The net pension liability was
measured as of June 30, 2015. The total pension liability used to calculate the net pension
liability was determined using update procedures to roll forward the total pension liability from
an actuarial valuation as of June 30, 2014, to the measurement date of June 30, 2015. The
Town’s proportion of the net pension liability was based on a projection of the Town’s long-
term share of contributions to the pension plan relative to the projected contributions of all
participating employers, actuarially determined. At June 30, 2015, the Town’s proportion was
0.12 percent, which was an increase of 0.01 from its proportion measured as of June 30, 2014.
Pension Expense and Deferred Outflows/Inflows of Resources. For the year ended
June 30, 2016, the Town recognized pension expense for ASRS of $1.1 million and reported
deferred outflows of resources and deferred inflows of resources related to pensions from the
following sources:
Deferred
Outflows of
Resources
Deferred
Inflows of
Resources
Differences between expected and actual experience $ 506,886 $ 973,377
Net difference between projected and actual earnings on
pension plan investments 595,305
Changes in proportion and differences between
contributions and proportionate share of contributions 773,569 302,657
Contributions subsequent to the measurement date 1,286,552
Total $ 2,567,007 $ 1,871,339
TOWN OF ORO VALLEY, ARIZONA
NOTES TO FINANCIAL STATEMENTS
JUNE 30, 2016
NOTE 15 – PENSIONS AND OTHER POSTEMPLOYMENT BENEFITS
The deferred outflows of resources related to ASRS pensions resulting from contributions
subsequent to the measurement date as reported in the table above will be recognized as a
reduction of the net pension liability in the year ended June 30, 2017. Other amounts reported
as deferred outflows of resources and deferred inflows of resources related to ASRS pensions
will be recognized in pension expense as follows:
Year Ending June 30:
2017 $ (275,403)
2018 (385,372)
2019 (359,844)
2020 429,735
Actuarial Assumptions. The significant actuarial assumptions used to measure the total ASRS
pension liability are as follows:
Actuarial valuation date June 30, 2014
Actuarial roll forward date June 30, 2015
Actuarial cost method Entry age normal
Investment rate of return 8.0%
Projected salary increases 3.0-6.75%
Inflation 3.0%
Permanent base increases Included
Mortality rates 1994 GAM Scale BB
The actuarial assumptions used in the June 30, 2014 valuation were based on the results of an
actuarial experience study for the five-year period ended June 30, 2012. The purpose of the
experience study was to review actual experience in relation to the actuarial assumptions in
effect. The ASRS Board adopted the experience study recommended changes which were
applied to the June 30, 2013, actuarial valuation. The study did not include an analysis of the
assumed investment rate of return.
The long-term expected rate of return on ASRS pension plan investments was determined to
be 8.79 percent using a building-block method in which best-estimate ranges of expected future
real rates of return (expected returns, net of pension plan investment expense and inflation) are
developed for each major asset class. These ranges are combined to produce the long-term
expected rate of return by weighting the expected future real rates of return by the target asset
allocation percentage and by adding expected inflation.
TOWN OF ORO VALLEY, ARIZONA
NOTES TO FINANCIAL STATEMENTS
JUNE 30, 2016
NOTE 15 – PENSIONS AND OTHER POSTEMPLOYMENT BENEFITS
The target allocation and best estimates of arithmetic real rates of return for each major asset
class of ASRS are summarized in the following table:
Asset Class
Target
Allocation
Long-Term
Expected Real
Rate of Return
Equity 58% 6.79%
Fixed income 25% 3.70
Real estate 10% 4.25
Multi-asset 5% 3.41%
Commodities 2% 3.93
Total 100%
Discount Rate. The discount rate used to measure the ASRS total pension liability was 8.0
percent, which is less than the long-term expected rate of return of 8.79 percent. The projection
of cash flows used to determine the discount rate assumed that contributions from participating
employers will be made based on the actuarially determined rates based on the ASRS Board’s
funding policy, which establishes the contractually required rate under Arizona statute. Based
on those assumptions, the pension plan’s fiduciary net position was projected to be available
to make all projected future benefit payments of current plan members. Therefore, the long-
term expected rate of return on pension plan investments was applied to all periods of projected
benefit payments to determine the total pension liability.
Sensitivity of the Proportionate Share of the Net Pension Liability to Changes in the
Discount Rate. The following presents the Town’s proportionate share of the net pension
liability calculated using the discount rate of 8.0 percent, as well as what the proportionate
share of the net pension liability would be if it were calculated using a discount rate that is 1-
percentage-point lower or 1-percentage-point higher than the current rate:
1% Decrease
(7.0%)
Current
Discount Rate
(8.0%)
1% Increase
(9.0%)
Proportionate share of the net
pension liability $24,340,301 $18,575,537 $14,624,784
Pension Plan Fiduciary Net Position. Detailed information about the pension plan’s fiduciary
net position is available in the separately issued ASRS financial report. The report is available
on the ASRS website at www.azasrs.gov.
TOWN OF ORO VALLEY, ARIZONA
NOTES TO FINANCIAL STATEMENTS
JUNE 30, 2016
NOTE 15 – PENSIONS AND OTHER POSTEMPLOYMENT BENEFITS
B. Public Safety Personnel Retirement System and Corrections Officer Retirement Plan
Plan Descriptions. Town public safety employees who are regularly assigned hazardous duty
participate in the Public Safety Personnel Retirement System (PSPRS). The PSPRS
administers an agent multiple-employer defined benefit pension plan and an agent multiple-
employer defined benefit health insurance premium benefit (OPEB) plan. A seven-member
board known as the Board of Trustees and the participating local boards govern the PSPRS
according to the provisions of A.R.S. Title 38, Chapter 5, Article 4.
Town dispatchers participate in the Corrections Officer Retirement Plan (CORP). The CORP
administers an agent multiple-employer defined benefit pension plan and an agent multiple-
employer defined benefit health insurance premium benefit (OPEB) plan. A seven-member
board known as the Board of Trustees and the participating local boards govern CORP
according to the provisions of A.R.S. Title 38, Chapter 5, Article 6.
The PSPRS and CORP issue publicly available financial reports that include their financial
statements and required supplementary information. The reports are available on the PSPRS
website at www.psprs.com.
Benefits Provided. The PSPRS and CORP provide retirement, health insurance premium
supplement, disability, and survivor benefits. State statute establishes benefits terms. Certain
retirement and disability benefits are calculated on the basis of age, average monthly
compensation, and service credit as follows. See the publicly available PSPRS and CORP
financial reports for additional benefits information.
TOWN OF ORO VALLEY, ARIZONA
NOTES TO FINANCIAL STATEMENTS
JUNE 30, 2016
NOTE 15 – PENSIONS AND OTHER POSTEMPLOYMENT BENEFITS
Public Safety Personnel Retirement System:
Retirement Initial
Membership Date:
Before January 1, 2012 On or After January 1, 2012
Years of service and age
required to receive benefit
20 years any age
15 years age 62
25 years and age 52.5
Final average salary is based on Highest 36 months of last
20 years
Highest 60 months of last
20 years
Normal retirement 50% less 2.0% for each year of
credited service less than 20 years or
plus 2.0% to 2.5% for each year of
credited service over 20 years, not to
exceed 80%
2.5% per year of credited service,
not to exceed 80%
Accidental disability retirement 50% or normal retirement, whichever is greater
Survivor benefit:
Retired members 80% of retired member’s pension benefit
Active members 80% of accidental disability retirement benefit or 100% of average monthly
compensation if death was the result of injuries received on the job
Corrections Officer Retirement Plan:
Retirement Initial
Membership Date:
Before January 1, 2012 On or After January 1, 2012
Years of service and age required
to receive benefit
Sum of years and age equals 80
25 years any age
10 years age 62
25 years and age 52.5
10 years age 62
Final average salary is based on Highest 36 months of
last 10 years
Highest 60 months of
last 10 years
Normal retirement 2.0% to 2.5% per year of credited service, not to exceed 80%
Accidental disability retirement 50% or normal retirement if more than
20 years of credited service
50% of normal retirement if more
than 25 years of credited service
Survivor benefit:
Retired members 80% of retired member’s pension benefit
Active members 40% of accidental disability retirement benefit or 100% of average monthly
compensation if death was the result of injuries received on the job
TOWN OF ORO VALLEY, ARIZONA
NOTES TO FINANCIAL STATEMENTS
JUNE 30, 2016
NOTE 15 – PENSIONS AND OTHER POSTEMPLOYMENT BENEFITS
Retirement and survivor benefits are subject to automatic cost-of-living adjustments based on
excess investment earning. In addition, from and after December 31, 2015 the Legislature may
enact permanent one-time benefit increases after a Joint Legislative Budget Committee analysis
of the increase’s effects on the plan. PSPRS also provides temporary disability benefits of 50
percent of the member's compensation for up to 12 months.
Employees Covered by Benefit Terms. At June 30, 2016, the following employees were
covered by the agent pension plans’ benefit terms:
PSPRS –
Police
CORP –
Dispatchers
Retirees and beneficiaries 26 4
Inactive, non-retired members 13 3
Active members 95 5
Total 134 12
Contributions and Annual OPEB Cost. State statutes establish the pension contribution
requirements for active PSPRS and CORP employees. In accordance with state statutes, annual
actuarial valuations determine employer contribution requirements for PSPRS and CORP
pension and health insurance premium benefits. The combined active member and employer
contribution rates are expected to finance the costs of benefits employees earn during the year,
with an additional amount to finance any unfunded accrued liability. Contributions rates for the
year ended June 30, 2016, are indicated below. Rates are a percentage of active members’ annual
covered payroll.
PSPRS –
Police
CORP –
Dispatchers
Active members – pension 11.65% 7.96%
Town:
Pension 24.70 22.05
Health insurance 0.37 0.00
TOWN OF ORO VALLEY, ARIZONA
NOTES TO FINANCIAL STATEMENTS
JUNE 30, 2016
NOTE 15 – PENSIONS AND OTHER POSTEMPLOYMENT BENEFITS
For the agent plans, the contributions to the pension plan and annual OPEB cost and
contributions for the health insurance premium benefit for the year ended were:
PSPRS –
Police
CORP –
Dispatchers
Pension:
Contributions made $ 1,554,131 $ 54,083
Health insurance premium benefit:
Annual OPEB cost 27,214 - 0 -
Contributions made 21,214 - 0 -
Pension Liability. At June 30, 2016, the Town reported the following net pension liabilities:
PSPRS – Police $ 14,850,954
CORP – Dispatchers 1,157,537
The net pension liabilities were measured as of June 30, 2015, and the total pension liability used
to calculate the net pension liability was determined by an actuarial valuation as of that date. The
total pension liability as of June 30, 2015, reflects changes of benefit terms and actuarial
assumptions for a court ruling for funding permanent benefit increases and a decrease in the
wage growth assumption.
In May 2016 voters approved Proposition 124 that authorized certain statutory adjustments to
PSPRS’ automatic cost-of-living adjustments. The statutory adjustments change the basis for
future cost-of-living adjustments from excess investment earnings to the change in the consumer
price index, limited to a maximum annual increase of two percent. The change in the Town’s net
pension liability as a result of the statutory adjustments is not known.
TOWN OF ORO VALLEY, ARIZONA
NOTES TO FINANCIAL STATEMENTS
JUNE 30, 2016
NOTE 15 – PENSIONS AND OTHER POSTEMPLOYMENT BENEFITS
Actuarial Assumptions. The significant actuarial assumptions used to measure the total pension
liability are as follows:
PSPRS CORP
Actuarial valuation date June 30, 2015 June 30, 2015
Actuarial cost method Entry age normal Entry age normal
Investment rate of return 7.85% 7.85%
Projected salary increases 4.0 - 8.0% 4.0 - 7.25%
Inflation 4.0% 4.0%
Permanent benefit increase Included Included
Mortality rates RP-2000 mortality table,
adjusted by 105% for both
males and females
RP-2000 mortality table,
adjusted by 105% for both
males and females
Actuarial assumptions used in the June 30, 2015, valuation were based on the results of an
actuarial experience study for the 5-year period ended June 30, 2011.
The long-term expected rate of return on PSPRS and CORP pension plan investments was
determined to be 7.85 percent using a building-block method in which best-estimate ranges of
expected future real rates of return (expected returns, net of pension plan investment expenses
and inflation) are developed for each major asset class.
The target allocation and best estimates of geometric real rates of return for each major asset
class for all agent pension plans are summarized in the following table:
Asset Class
Target
Allocation
Long-Term
Expected Real
Rate of Return
Short-term investments 2% 0.75%
Absolute return 5% 4.11%
Risk parity 4% 5.13%
Fixed income 7% 2.92%
Real assets 8% 4.77%
GTAA 10% 4.38%
Private equity 11% 9.50%
Real estate 10% 4.48%
Credit opportunities 13% 7.08%
Non-U.S. equity 14% 8.25%
U.S. equity 16% 6.23%
Total 100%
TOWN OF ORO VALLEY, ARIZONA
NOTES TO FINANCIAL STATEMENTS
JUNE 30, 2016
NOTE 15 – PENSIONS AND OTHER POSTEMPLOYMENT BENEFITS
Pension Discount Rates. The following discount rates were used to measure the total pension
liabilities:
PSPRS –
Police
CORP –
Dispatchers
Discount rates 7.85% 7.85%
The projection of cash flows used to determine the PSPRS and CORP discount rates assumed
that plan member contributions will be made at the current contribution rate and that employer
contributions will be made at rates equal to the difference between the actuarially determined
contribution rates and the member rate. Based on those assumptions, the PSPRS and CORP
pension plans’ fiduciary net position were projected to be available to make all projected future
benefit payments of current plan members. Therefore, the long-term expected rate of return on
pension plan investments was applied to all periods of projected benefit payments to determine
the total pension liability.
Changes in the Agent Plans Net Pension Liability: PSPRS – Police
Increase/Decrease
Total Pension
Liability
Plan Fiduciary
Net Position
Net Pension
Liability
Balances at June 30, 2015 $ 36,122,643 $ 23,241,057 $ 12,881,586
Changes for the year:
Service cost 1,224,807 1,224,807
Interest on the total pension liability 2,842,514 2,842,514
Differences between expected and actual
experience in the measurement of the
pension liability 1,312,293 1,312,293
Changes of assumptions or other inputs
Contributions – employer 1,669,125 (1,669,125)
Contributions – employee 794,478 (794,478)
Net investment income 874,562 (874,562)
Benefit payments, including refunds of
employee contributions (1,049,346) (1,049,346)
Administrative expense (21,722) 21,722
Other 93,803 (93,803)
Net changes 4,330,268 2,360,900 1,969,368
Balances at June 30, 2016 $ 40,452,911 $ 25,601,957 $ 14,850,954
TOWN OF ORO VALLEY, ARIZONA
NOTES TO FINANCIAL STATEMENTS
JUNE 30, 2016
NOTE 15 – PENSIONS AND OTHER POSTEMPLOYMENT BENEFITS
Changes in the Agent Plans Net Pension Liability: CORP – Dispatchers
Increase/Decrease
Total Pension
Liability
Plan Fiduciary
Net Position
Net Pension
Liability
Balances at June 30, 2015 $ 2,269,744 $ 1,216,956 $ 1,052,788
Changes for the year:
Service cost 52,754 52,754
Interest on the total pension liability 174,403 174,403
Differences between expected and actual
experience in the measurement of the
pension liability 14,554 14,554
Contributions – employer 64,005 (64,005)
Contributions – employee 30,272 (30,272)
Net investment income 45,101 (45,101)
Benefit payments, including refunds of
employee contributions (148,851) (148,851)
Administrative expense (1,490)1,490
Other changes (926)926
Net changes 92,860 (11,889) 104,749
Balances at June 30, 2016 $ 2,362,604 $ 1,205,067 $ 1,157,537
Sensitivity of the Net Pension Liability to Changes in the Discount Rate. The following
presents the Town’s net pension liabilities calculated using the discount rates noted above, as
well as what the net pension liability would be if it were calculated using a discount rate that
is 1-percentage-point lower or 1-percentage-point higher than the current rate:
1%
Decrease
Current
Discount
Rate
1%
Increase
PSPRS – Police: Rate 6.85% 7.85% 8.85%
Net pension liability $20,371,341 $14,850,954 $10,304,836
CORP – Dispatchers:
Rate 6.85% 7.85% 8.85%
Net pension liability $ 1,441,188 $ 1,157,537 $ 919,537
Pension Plan Fiduciary Net Position. Detailed information about the pension plans’ fiduciary
net position is available in the separately issued PSPRS and CORP financial reports. The reports
are available on the PSPRS website at www.psprs.com.
TOWN OF ORO VALLEY, ARIZONA
NOTES TO FINANCIAL STATEMENTS
JUNE 30, 2016
NOTE 15 – PENSIONS AND OTHER POSTEMPLOYMENT BENEFITS
Pension Expense. For the year ended June 30, 2016, the Town’s recognized the following
pension expense:
Pension
Expense
PSPRS – Police $ 1,930,079
CORP – Dispatchers 132,215
Pension Deferred Outflows/Inflows of Resources. At June 30, 2016, the Town reported
deferred outflows of resources and deferred inflows of resources related to pensions from the
following sources:
PSPRS – Police:
Deferred
Outflows of
Resources
Deferred
Inflows of
Resources
Differences between expected and actual experience $ 1,098,307 $ 243,112
Changes of assumptions or other inputs 2,053,861
Net difference between projected and actual earnings on
pension plan investments 126,018
Contributions subsequent to the measurement date 1,554,131
Total $ 4,832,317 $ 243,112
CORP – Dispatchers:
Deferred
Outflows of
Resources
Deferred
Inflows of
Resources
Differences between expected and actual experience $ 11,022 $ 29,411
Changes of assumptions or other inputs 105,258
Net difference between projected and actual earnings on
pension plan investments 2,783
Contributions subsequent to the measurement date 54,083
Total $ 173,146 $ 29,411
TOWN OF ORO VALLEY, ARIZONA
NOTES TO FINANCIAL STATEMENTS
JUNE 30, 2016
NOTE 15 – PENSIONS AND OTHER POSTEMPLOYMENT BENEFITS
The amounts reported as deferred outflows of resources related to pension resulting from
contributions subsequent to the measurement date will be recognized as a reduction of the net
pension liability (or an increase in the net pension asset) in the year ended June 30, 2017. Other
amounts reported as deferred outflows of resources and deferred inflows of resources related
to pensions will be recognized in pension expense as follows:
Year Ending June 30:
PSPRS –
Police
CORP –
Dispatchers
2017 $ 612,079 $ 26,208
2018 612,079 26,208
2019 612,078 26,209
2020 838,926 11,027
2021 331,535 - 0 -
Thereafter 28,377 - 0 -
Agent Plan OPEB Trend Information. The table below presents the annual OPEB cost
information for the health insurance premium benefit for the current and two preceding years:
Fiscal Year Ended
Annual
OPEB Cost
Percentage of
Annual Cost
Contributed
Net OPEB
Obligation
PSPRS – Police:
June 30, 2016 $ 27,214 100% $- 0 -
June 30, 2015 88,254 100% - 0 -
June 30, 2014 75,539 100% - 0 -
CORP – Dispatchers:
June 30, 2016 $ - 0 - 100% $- 0 -
June 30, 2015 4,374 100% - 0 -
June 30, 2014 4,533 100% - 0 -
TOWN OF ORO VALLEY, ARIZONA
NOTES TO FINANCIAL STATEMENTS
JUNE 30, 2016
NOTE 15 – PENSIONS AND OTHER POSTEMPLOYMENT BENEFITS
Agent Plan OPEB Actuarial Assumptions. Actuarial valuations involve estimates of the
reported amounts’ value and assumptions about the probability of events in the future.
Amounts determined regarding the funded status of the plans and the annual required
contributions are subject to continual revision as actual results are compared to past
expectations and new estimates are made. The required schedule of funding progress for the
health insurance premium benefit presented as required supplementary information provides
multiyear trend information that shows whether the actuarial value of the plans’ assets are
increasing or decreasing over time relative to the actuarial accrued liability for benefits.
Projections of benefits are based on (1) the plans as understood by the Town and plans’
members and include the types of benefits inforce at the valuation date, and (2) the pattern of
sharing benefit costs between the Town and plans’ members to that point. Actuarial
calculations reflect a long-term perspective and employ methods and assumptions that are
designed to reduce short-term volatility in actuarial accrued liabilities and the actuarial value
of assets.
The significant actuarial methods and assumptions used are the same for all PSPRS and CORP
plans and related benefits (unless noted), and the actuarial methods and assumptions used to
establish the fiscal year 2016 contribution requirements, are as follows:
PSPRS CORP
Actuarial valuation date June 30, 2014 June 30, 2014
Actuarial cost method Entry age normal Entry age normal
Amortization method Level percent of pay closed Level percent of pay closed
Remaining amortization period 22 years for unfunded, 20
years for overfunded
22 years for unfunded, 20
years for overfunded
Asset valuation method 7-year smoothed market
value (80%/120% market)
7-year smoothed market value
(80%/120% market)
Actuarial assumptions:
Investment rate of return 7.85% 7.85%
Projected salary increases
includes inflation at
4%-8%
4%
4%-7.25%
4%
TOWN OF ORO VALLEY, ARIZONA
NOTES TO FINANCIAL STATEMENTS
JUNE 30, 2016
NOTE 15 – PENSIONS AND OTHER POSTEMPLOYMENT BENEFITS
The funded status of the all the PSPRS and CORP health insurance premium benefit plans in
the June 30, 2015, actuarial valuation was determined using the following actuarial methods
and assumptions, applied to all periods included in the measurement.
PSPRS CORP
Actuarial valuation date June 30, 2015 June 30, 2015
Actuarial cost method Entry age normal Entry age normal
Amortization method Level percent of pay closed Level percent of pay closed
Remaining amortization period 21 years for unfunded, 20
years for overfunded
21 years for unfunded, 20
years for overfunded
Asset valuation method 7-year smoothed market
value (80%/120% market)
7-year smoothed market
value (80%/120% market)
Actuarial assumptions:
Investment rate of return 7.85% 7.85%
Projected salary increases
includes inflation at
4%-8%
4%
4%-7.25%
4%
Agent Plan OPEB Funded Status. The following table presents the funded status of the health
insurance premium benefit plans as of the most recent valuation date, June 30, 2015.
PSPRS –
Police
CORP –
Dispatchers
Actuarial value of assets $ 1,062,519 $ 85,050
Actuarial accrued liability 1,029,811 48,723
Unfunded actuarial accrued
asset (liability) 32,708 36,327
Funded ratio 103.18% 174.56%
Annual covered payroll 7,024,821 272,189
Unfunded actuarial accrued
asset (liability) as a
percentage of covered
payroll 0.00% 0.00%
REQUIRED SUPPLEMENTARY INFORMATION
Revenues:
Sales taxes
Franchise taxes
Intergovernmental
Licenses, fees & permits
Fines, forfeitures & penalties
Charges for services
Investment earnings
Other
Total revenues
Expenditures:
Current -
General government
Public safety
Transit
Culture and recreation
Debt service -
Principal retirement
Interest and fiscal charges
Total expenditures
Excess (deficiency) of revenues over expenditures
Other financing sources (uses):
Transfers in
Transfers out
Total other financing sources (uses):
Changes in fund balances
Fund balances, beginning of year
Fund balances (deficits), end of year
Budgeted
Amounts
Original & Final
$ 14,780,654
570,000
12,519,376
1,764,000
120,000
1,873,834
94,400
135,000
31,857,264
10,631,382
15,204,563
1,479,547
3,004,988
41,608
3,845
30,365,933
1,491,331
185,000
(1,706,810)
(1,521,810)
(30,479)
$(30,479)
Actual
$ 13,913,125
621,546
12,732,130
1,872,858
159,154
2,100,215
162,310
322,640
31,883,978
10,775,836
15,182,914
1,432,910
3,033,101
41,608
3,845
30,470,214
1,413,764
185,000
(1,226,086)
(1,041,086)
372,678
10,151,875
$10,524,553
Variance with
Final Budget
Positive
(Negative)
$ (867,529)
51,546
212,754
108,858
39,154
226,381
67,910
187,640
26,714
(144,454)
21,649
46,637
(28,113)
(104,281)
(77,567)
480,724
480,724
403,157
10,151,875
$10,555,032
TOWN OF ORO VALLEY, ARIZONA
SCHEDULE OF REVENUES, EXPENDITURES AND
CHANGES IN FUND BALANCES - BUDGET AND ACTUAL
GENERAL FUND
YEAR ENDED JUNE 30, 2016
See accompanying notes to this schedule.
Revenues:
Sales taxes
Charges for services
Contributions and donations
Other
Total revenues
Expenditures:
Current -
Culture and recreation
Capital outlay
Debt service -
Principal retirement
Interest and fiscal charges
Total expenditures
Excess (deficiency) of revenues over expenditures
Other financing sources (uses):
Capital lease agreements
Total other financing sources (uses):
Changes in fund balances
Fund balances, beginning of year
Fund balances (deficits), end of year
Budgeted
Amounts
Original & Final
$ 2,000,000
5,400,763
7,400,763
6,472,097
1,720,000
180,109
24,995
8,397,201
(996,438)
(996,438)
$(996,438)
Actual
$ 2,030,750
3,721,843
149,513
3,946
5,906,052
6,064,651
1,542,988
180,109
24,995
7,812,743
(1,906,691)
1,043,214
1,043,214
(863,477)
1,025,222
$161,745
Variance with
Final Budget
Positive
(Negative)
$ 30,750
(1,678,920)
149,513
3,946
(1,494,711)
407,446
177,012
584,458
(910,253)
1,043,214
1,043,214
132,961
1,025,222
$1,158,183
TOWN OF ORO VALLEY, ARIZONA
SCHEDULE OF REVENUES, EXPENDITURES AND
CHANGES IN FUND BALANCES - BUDGET AND ACTUAL
COMMUNITY CENTER
YEAR ENDED JUNE 30, 2016
See accompanying notes to this schedule.
2016 2015 2014 2013
Town's proportion of the net pension
liability (asset) 0.12% 0.11%0.00% 0.00%
Town's proportionate share of the net
pension liability (asset) 18,575,537$ 16,642,712$ $ $
Town's covered payroll 11,826,486$ 11,086,887$ $ $
Town's proportionate share of the net
pension liability (asset) as a percentage
of its covered payroll 157.07% 150.11%#DIV/0! #DIV/0!
Plan fiduciary net position as a
percentage of the total pension liability 68.35% 69.49%0.00% 0.00%
2011 2010 2009 2008
Town's proportion of the net pension
liability (asset) 0.00% 0.00% 0.00% 0.00%
Town's proportionate share of the net
pension liability (asset) $ $ $ $
Town's covered payroll $ $ $ $
Town's proportionate share of the net
pension liability (asset) as a percentage
of its covered payroll #DIV/0! #DIV/0! #DIV/0! #DIV/0!
Plan fiduciary net position as a
percentage of the total pension liability 0.00% 0.00% 0.00% 0.00%
NOTE:The pension schedules in the required supplementary information are intended to show information for ten years, and
additional information will be displayed as it becomes available.
TOWN OF ORO VALLEY, ARIZONA
SCHEDULE OF THE PROPORTIONATE SHARE OF THE NET PENSION LIABILITY
ARIZONA STATE RETIREMENT SYSTEM
LAST TWO FISCAL YEARS
See accompanying notes to this schedule.
2016 2015
Total pension liability
Service cost $ 1,224,807 $ 1,157,832
Interest 2,842,514 2,408,825
Changes of benefit terms 444,387
Differences between expected and actual experience 1,312,293 (356,776)
Changes of assumptions 3,014,125
Benefit payments, including refunds (1,049,346) (1,304,993)
Net change in total pension liability 4,330,268 5,363,400
Total pension liability—beginning 36,122,643 30,759,243
Total pension liability—ending $ 40,452,911 $ 36,122,643
Plan fiduciary net position
Contributions—employer $ 1,669,125 $ 1,211,218
Contributions—employee 794,478 698,036
Net investment income 874,562 2,774,126
Benefit payments, including refunds (1,049,346) (1,304,993)
Administrative expense (21,722) (22,342)
Other 93,803 (93,142)
Net change in plan fiduciary net position 2,360,900 3,262,903
Plan fiduciary net position—beginning 23,241,057 19,978,154
Plan fiduciary net position—ending $ 25,601,957 $ 23,241,057
Net pension liability—ending $ 14,850,954 $ 12,881,586
Plan fiduciary net position as a percentage of
the total pension liability 63.29% 64.34%
Covered payroll $ 7,004,292 $ 6,021,786
Net pension liability as a percentage of covered
payroll 212.03% 213.92%
TOWN OF ORO VALLEY, ARIZONA
SCHEDULE OF CHANGES IN THE NET PENSION LIABILITY AND RELATED RATIOS
PUBLIC SAFETY PERSONNEL RETIREMENT SYSTEM - POLICE
LAST TWO FISCAL YEARS
NOTE: The pension schedules in the required supplementary information are intended to show
information for ten years, and additional information will be displayed as it becomes available.
See accompanying notes to this schedule.
2016 2015
Total pension liability
Service cost $ 52,754 $ 53,985
Interest 174,403 154,443
Changes of benefit terms 29,545
Differences between expected and actual experience 14,554 (48,767)
Changes of assumptions 174,536
(148,851) (68,874)
Net change in total pension liability 92,860 294,868
Total pension liability—beginning 2,269,744 1,974,876
Total pension liability—ending $ 2,362,604 $ 2,269,744
Plan fiduciary net position
Contributions—employer $ 64,005 $ 63,179
Contributions—employee 30,272 32,699
Net investment income 45,101 146,441
(148,851) (68,874)
Administrative expense (1,490) (1,151)
Other (926)
Net change in plan fiduciary net position (11,889) 172,294
Plan fiduciary net position—beginning 1,216,956 1,044,662
Plan fiduciary net position—ending $ 1,205,067 $ 1,216,956
Net pension liability—ending $ 1,157,537 $ 1,052,788
Plan fiduciary net position as a percentage of
the total pension liability 51.01% 53.62%
Covered payroll $ 380,303 $ 387,839
Net pension liability as a percentage of covered
payroll 304.37% 271.45%
Benefit payments, including refunds
Benefit payments, including refunds
TOWN OF ORO VALLEY, ARIZONA
SCHEDULE OF CHANGES IN THE NET PENSION LIABILITY AND RELATED RATIOS
CORRECTIONS OFFICER RETIREMENT PLAN - DISPATCHERS
LAST TWO FISCAL YEARS
NOTE: The pension schedules in the required supplementary information are intended to show
information for ten years, and additional information will be displayed as it becomes available.
See accompanying notes to this schedule.
2016 2015
Arizona State Retirement System:
Actuarially determined contribution 1,286,552$ 1,207,362$
Contributions in relation to the
actuarially determined contribution 1,286,552 1,207,362
Contribution deficiency (excess) $ $
Town's covered payroll 11,826,486$ 11,086,887$
Contributions as a percentage
of covered payroll 10.88% 10.89%
Public Safety Personnel Retirement System - Police:
Actuarially determined contribution 1,554,131$ 1,354,630$
Contributions in relation to the
actuarially determined contribution 1,554,131 1,354,630
Contribution deficiency (excess) $ $
Town's covered payroll 7,355,092$ 7,004,292$
Contributions as a percentage
of covered payroll 21.13% 19.34%
Correctional Officers Retirement Plan -Dispatchers:
Actuarially determined contribution 54,083$ 64,005$
Contributions in relation to the
actuarially determined contribution 54,083 64,005
Contribution deficiency (excess) $ $
Town's covered-employee payroll 245,274$ 380,303$
Contributions as a percentage
of covered-employee payroll 22.05% 16.83%
NOTE:The pension schedules in the required supplementary information are intended to show
information for ten years, and additional information will be displayed as it becomes
available.
TOWN OF ORO VALLEY, ARIZONA
SCHEDULE OF CONTRIBUTIONS
ALL PENSION PLANS
LAST TWO FISCAL YEARS
See accompanying notes to this schedule.
Public Safety Personnel Retirement System - Police:
2015 1,062,519$ 1,029,811$ 32,708$ 103.18 % 7,024,821$ 0.00 %
2014 920,139 937,923 (17,784) 98.10 6,446,142 0.28
2013 - 896,558 (896,558) - 6,048,143 14.82
Correctional Officers Retirement Plan -Dispatchers:
2015 85,050$ 48,723$ 36,327$ 174.56 % 272,189$ 0.00 %
2014 78,501 67,692 10,809 115.97 410,789 (2.63)
2013 - 66,776 (66,776) - 405,564 16.47
UAAL as a
percentage of
Covered Payroll
Actuarial
Valuation
Date
TOWN OF ORO VALLEY, ARIZONA
SCHEDULE OF FUNDING PROGRESS
PUBLIC SAFETY PERSONNEL RETIREMENT SYSTEM
OTHER POSTEMPLOYMENT BENEFITS
LAST THREE ACTUARIAL VALUATIONS
Actuarial
Valuation of
Assets
Actuarial
Accrued
Liability
(AAL)
Unfunded
AAL
(UAAL)
Funded
Ratio
Covered
Payroll
See accompanying notes to this schedule.
TOWN OF ORO VALLEY, ARIZONA
NOTES TO REQUIRED SUPPLEMENTARY INFORMATION
JUNE 30, 2016
NOTE 1 – BUDGETARY BASIS OF ACCOUNTING
The Town budget is prepared on a basis consistent with accounting principles generally
accepted in the United States of America.
NOTE 2 – PENSION PLAN SCHEDULES
Change in Accounting Principle. For the year ended June 30, 2016, the Town implemented
the provisions of GASB Statement No. 82, Pension Issues. The statement changed the measure
of payroll that is required to be presented in required supplementary information from covered-
employee payroll to covered payroll. Accordingly, payroll amounts presented in the pension
plan schedules and related ratios for prior periods have been restated.
Factors that Affect Trends. The actuarial assumptions used in the June 30, 2014, valuation
for ASRS were based on the results of an actuarial experience study for the five-year period
ended June 30, 2012. The purpose of the experience study was to review actual experience in
relation to the actuarial assumptions in effect. The ASRS Board adopted the experience study
recommended changes which were applied to the June 30, 2014, actuarial valuation. The study
did not include an analysis of the assumed investment rate of return.
The actuarial assumptions used in the June 30, 2015, valuation for PSPRS were based on the
results of an actuarial experience study for the 5-year period ended June 30, 2011. The total
pension liability used to calculate the net pension liability for PSPRS was determined by an
actuarial valuation as of that date. The total pension liability as of June 30, 2015, reflects
changes of benefit terms and actuarial assumptions for a court ruling for funding permanent
benefit increases and a decrease in the wage growth assumption from 4.5% to 4.0%.
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COMBINING AND INDIVIDUAL
FUND FINANCIAL STATEMENTS
AND SCHEDULES
(This page intentionally left blank)
GOVERNMENTAL FUNDS
ASSETS
Cash and cash equivalents
Intergovernmental receivable
Special assessments
Total assets
LIABILITIES, DEFERRED INFLOWS OF
RESOURCES AND FUND BALANCES
Liabilities:
Accounts payable
Accrued wages and benefits
Due to other funds
Total liabilities
Deferred inflows of resources:
Unavailable revenues - special assessments
Fund balances (deficits):
Restricted
Committed
Assigned
Unassigned
Total fund balances
Total liabilities, deferred inflows of resources
and fund balances
Special Revenue
$ 2,614,296
283,488
$2,897,784
$ 185,602
105,983
29,103
320,688
85,551
2,520,743
(29,198)
2,577,096
$2,897,784
Debt Service
$ 71,454
790,000
$861,454
$ 2,000
2,000
790,000
69,454
69,454
$861,454
Capital Projects
$ 4,943,614
648,482
$5,592,096
$ 311,219
311,219
3,924,168
15,718
1,340,991
5,280,877
$5,592,096
TOWN OF ORO VALLEY, ARIZONA
COMBINING BALANCE SHEET - ALL NON-MAJOR GOVERNMENTAL FUNDS - BY FUND TYPE
JUNE 30, 2016
Total Non-
Major
Governmental
Fund
$ 7,629,364
931,970
790,000
$9,351,334
$ 498,821
105,983
29,103
633,907
790,000
4,079,173
2,536,461
1,340,991
(29,198)
7,927,427
$9,351,334
Revenues:
Sales taxes
Development impact fees
Special assessments
Intergovernmental
Licenses, fees & permits
Fines, forfeitures & penalties
Charges for services
Investment earnings
Other
Total revenues
Expenditures:
Current -
General government
Public safety
Highway and streets
Capital outlay
Debt service -
Principal retirement
Interest and fiscal charges
Bond issuance costs
Total expenditures
Excess (deficiency) of revenues over expenditures
Other financing sources (uses):
Sale of refunding bonds
Transfers in
Transfers out
Payment to bond escrow agent
Total other financing sources (uses):
Changes in fund balances
Fund balances, beginning of year
Fund balances, end of year
Special Revenue
$ 1,054,589
3,232,431
43,134
124,316
134,000
66,284
33,066
4,687,820
650,851
271,113
2,754,413
1,811,532
5,487,909
(800,089)
(642,910)
(642,910)
(1,442,999)
4,020,095
$2,577,096
Debt Service
$
189,525
33,470
42
100,916
323,953
675,920
307,670
104,533
1,088,123
(764,170)
2,529,250
658,750
(2,523,121)
664,879
(99,291)
168,745
$69,454
Capital Projects
$
795,471
3,490,035
9,574
44,228
4,339,308
40,505
4,640,820
4,681,325
(342,017)
1,028,276
1,028,276
686,259
4,594,618
$5,280,877
TOWN OF ORO VALLEY, ARIZONA
COMBINING STATEMENT OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCES -
ALL NON-MAJOR GOVERNMENTAL FUNDS - BY FUND TYPE
YEAR ENDED JUNE 30, 2016
Total Non-
Major
Governmental
Funds
$ 1,054,589
795,471
189,525
6,755,936
43,134
124,316
134,000
75,900
178,210
9,351,081
650,851
311,618
2,754,413
6,452,352
675,920
307,670
104,533
11,257,357
(1,906,276)
2,529,250
1,687,026
(642,910)
(2,523,121)
1,050,245
(856,031)
8,783,458
$7,927,427
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SPECIAL REVENUE FUNDS
The Special Revenue Funds account for the proceeds of specific revenue sources, other than major
capital projects, that are legally restricted to expenditures for specified purposes.
Highway User Revenue – accounts for the Town’s share of motor fuel tax revenues.
State Seizures and Forfeitures – accounts for state police seizures and forfeitures received by the
Town.
Federal Seizures and Forfeitures – accounts for federal police seizures and forfeitures received
by the Town.
Bed Tax – accounts for the collection of the 6 percent bed tax revenues which funds economic
development and tourism initiatives.
Impound Fee – accounts for the collection of administrative fees for processing vehicles
impounded by the Oro Valley police department.
ASSETS
Cash and cash equivalents
Intergovernmental receivable
Total assets
LIABILITIES AND FUND BALANCES
Liabilities:
Accounts payable
Accrued wages and benefits
Due to other funds
Total liabilities
Fund balances (deficits):
Restricted
Committed
Unassigned
Total fund balances
Total liabilities and fund balances
HURF
$ 1,966,536
283,488
$2,250,024
$ 115,675
105,983
221,658
2,028,366
2,028,366
$2,250,024
State Seizures
and Forfeitures
$ 39,738
$39,738
$
39,738
39,738
$39,738
Federal Seizures
and Forfeitures
$
$
$95
29,103
29,198
(29,198)
(29,198)
$
TOWN OF ORO VALLEY, ARIZONA
COMBINING BALANCE SHEET - NON-MAJOR SPECIAL REVENUE FUNDS
JUNE 30, 2016
Bed Tax
$ 562,201
$562,201
$ 69,824
69,824
492,377
492,377
$562,201
Impound Fee
$ 45,821
$45,821
$8
8
45,813
45,813
$45,821
Totals
$ 2,614,296
283,488
$2,897,784
$ 185,602
105,983
29,103
320,688
85,551
2,520,743
(29,198)
2,577,096
$2,897,784
Revenues:
Sales taxes
Intergovernmental
Licenses, fees & permits
Fines, forfeitures & penalties
Charges for services
Investment earnings
Other
Total revenues
Expenditures:
Current -
General government
Public safety
Highway and streets
Capital outlay
Total expenditures
Excess (deficiency) of revenues over expenditures
Other financing sources (uses):
Transfers out
Total other financing sources (uses):
Changes in fund balances
Fund balances, beginning of year
Fund balances (deficits), end of year
HURF
$
3,232,431
43,134
134,000
54,746
33,066
3,497,377
2,754,413
1,777,314
4,531,727
(1,034,350)
(228,366)
(228,366)
(1,262,716)
3,291,082
$2,028,366
State Seizures
and Forfeitures
$
68,878
1,350
70,228
222,550
31,960
254,510
(184,282)
(184,282)
224,020
$39,738
Federal Seizures
and Forfeitures
$
9,408
284
9,692
48,563
2,258
50,821
(41,129)
(41,129)
11,931
$(29,198)
TOWN OF ORO VALLEY, ARIZONA
COMBINING STATEMENT OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCES -
NON-MAJOR SPECIAL REVENUE FUNDS
YEAR ENDED JUNE 30, 2016
Bed Tax
$ 1,054,589
9,904
1,064,493
622,199
622,199
442,294
(414,544)
(414,544)
27,750
464,627
$492,377
Impound Fee
$
46,030
46,030
28,652
28,652
17,378
17,378
28,435
$45,813
Totals
$ 1,054,589
3,232,431
43,134
124,316
134,000
66,284
33,066
4,687,820
650,851
271,113
2,754,413
1,811,532
5,487,909
(800,089)
(642,910)
(642,910)
(1,442,999)
4,020,095
$2,577,096
Total revenues
Revenues:
Sales taxes
Intergovernmental
Licenses, fees & permits
Fines, forfeitures & penalties
Charges for services
Investment earnings
Other
Expenditures:
Current -
General government
Public safety
Highway and streets
Capital outlay
Total expenditures
Excess (deficiency) of revenues over expenditures
Other financing sources (uses):
Transfers out
Total other financing sources (uses):
Changes in fund balances
Fund balances, beginning of year
Fund balances (deficits), end of year
HURF
Budget
$
2,985,464
51,000
134,000
22,400
10,000
3,202,864
3,828,535
1,844,250
5,672,785
(2,469,921)
(228,366)
(228,366)
(2,698,287)
$(2,698,287)
Actual
$
3,232,431
43,134
134,000
54,746
33,066
3,497,377
2,754,413
1,777,314
4,531,727
(1,034,350)
(228,366)
(228,366)
(1,262,716)
3,291,082
$2,028,366
Variance -
Positive
(Negative)
$
246,967
(7,866)
32,346
23,066
294,513
1,074,122
66,936
1,141,058
1,435,571
1,435,571
3,291,082
$4,726,653
TOWN OF ORO VALLEY, ARIZONA
COMBINING SCHEDULE OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCES -
BUDGET AND ACTUAL
NON-MAJOR SPECIAL REVENUE FUNDS
YEAR ENDED JUNE 30, 2016
State Seizures and Forfeitures
Budget
$
175,000
175,000
387,846
387,846
(212,846)
(212,846)
$(212,846)
Actual
$
68,878
1,350
70,228
222,550
31,960
254,510
(184,282)
(184,282)
224,020
$39,738
Variance -
Positive
(Negative)
$
(106,122)
1,350
(104,772)
165,296
(31,960)
133,336
28,564
28,564
224,020
$252,584
Federal Seizures and Forfeitures
Budget
$
250,000
250,000
287,609
287,609
(37,609)
(37,609)
$(37,609)
Actual
$
9,408
284
9,692
48,563
2,258
50,821
(41,129)
(41,129)
11,931
$(29,198)
Variance -
Positive
(Negative)
$
(240,592)
284
(240,308)
239,046
(2,258)
236,788
(3,520)
(3,520)
11,931
$8,411
(Continued)
Total revenues
Revenues:
Sales taxes
Intergovernmental
Licenses, fees & permits
Fines, forfeitures & penalties
Charges for services
Investment earnings
Other
Expenditures:
Current -
General government
Public safety
Highway and streets
Capital outlay
Total expenditures
Excess (deficiency) of revenues over expenditures
Other financing sources (uses):
Transfers out
Total other financing sources (uses):
Changes in fund balances
Fund balances, beginning of year
Fund balances (deficits), end of year
Bed Tax
Budget
$ 945,000
1,800
946,800
950,226
950,226
(3,426)
414,544
414,544
411,118
$411,118
Actual
$ 1,054,589
9,904
1,064,493
622,199
622,199
442,294
(414,544)
(414,544)
27,750
464,627
$492,377
Variance -
Positive
(Negative)
$ 109,589
8,104
117,693
328,027
328,027
445,720
(829,088)
(829,088)
(383,368)
464,627
$81,259
TOWN OF ORO VALLEY, ARIZONA
COMBINING SCHEDULE OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCES -
BUDGET AND ACTUAL
NON-MAJOR SPECIAL REVENUE FUNDS
YEAR ENDED JUNE 30, 2016
Impound Fee
Budget
$
34,000
34,000
50,736
50,736
(16,736)
(16,736)
$(16,736)
Actual
$
46,030
46,030
28,652
28,652
17,378
17,378
28,435
$45,813
Variance -
Positive
(Negative)
$
12,030
12,030
22,084
22,084
34,114
34,114
28,435
$62,549
Totals
Budget
$ 945,000
2,985,464
51,000
459,000
134,000
24,200
10,000
4,608,664
1,000,962
675,455
3,828,535
1,844,250
7,349,202
(2,740,538)
186,178
186,178
(2,554,360)
$(2,554,360)
Actual
$ 1,054,589
3,232,431
43,134
124,316
134,000
66,284
33,066
4,687,820
650,851
271,113
2,754,413
1,811,532
5,487,909
(800,089)
(642,910)
(642,910)
(1,442,999)
4,020,095
$2,577,096
Variance -
Positive
(Negative)
$ 109,589
246,967
(7,866)
(334,684)
42,084
23,066
79,156
350,111
404,342
1,074,122
32,718
1,861,293
1,940,449
(829,088)
(829,088)
1,111,361
4,020,095
$5,131,456
(This page intentionally left blank)
MUNICIPAL DEBT SERVICE FUNDS
Municipal Debt Service - to account for the payments of debt service on the Series 2005 Excise
Tax Revenue Obligations, the Series 2007 MPC Excise Tax Revenue Refunding Bonds, the Series
2010 Excise Tax Revenue Clean Renewable Energy Bonds (CREBs), the Series 2012 Excise Tax
Revenue Obligations, and the Series 2015 Excise Tax Revenue Refunding Obligations.
Oracle Road Debt Service – to account for the special assessment collections and payment of the
outstanding Oracle Road bond issue.
ASSETS
Cash and cash equivalents
Special assessments
Total assets
LIABILITIES, DEFERRED INFLOWS OF
RESOURCES AND FUND BALANCES
Liabilities:
Accounts payable
Total liabilities
Deferred inflows of resources:
Unavailable revenues - special assessments
Fund balances:
Restricted
Total fund balances
Total liabilities, deferred inflows of resources
and fund balances
Municipal Debt
Service
$ 64,486
$64,486
$2,000
2,000
62,486
62,486
$64,486
Oracle Road
Debt Service
$ 6,968
790,000
$796,968
$
790,000
6,968
6,968
$796,968
Totals
$ 71,454
790,000
$861,454
$2,000
2,000
790,000
69,454
69,454
$861,454
TOWN OF ORO VALLEY, ARIZONA
COMBINING BALANCE SHEET - NON-MAJOR DEBT SERVICE FUNDS
JUNE 30, 2016
Revenues:
Special assessments
Intergovernmental
Investment earnings
Other
Total revenues
Expenditures:
Debt service -
Principal retirement
Interest and fiscal charges
Bond issuance costs
Total expenditures
Excess (deficiency) of revenues over expenditures
Other financing sources (uses):
Sale of refunding bonds
Transfers in
Payment to bond escrow agent
Total other financing sources (uses):
Changes in fund balances
Fund balances, beginning of year
Fund balances, end of year
Municipal Debt
Service
$
33,470
42
100,916
134,428
530,920
265,167
104,533
900,620
(766,192)
2,529,250
655,750
(2,523,121)
661,879
(104,313)
166,799
$62,486
Oracle Road
Debt Service
$ 189,525
189,525
145,000
42,503
187,503
2,022
3,000
3,000
5,022
1,946
$6,968
Totals
$ 189,525
33,470
42
100,916
323,953
675,920
307,670
104,533
1,088,123
(764,170)
2,529,250
658,750
(2,523,121)
664,879
(99,291)
168,745
$69,454
TOWN OF ORO VALLEY, ARIZONA
COMBINING STATEMENT OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCES -
NON-MAJOR DEBT SERVICE FUNDS
YEAR ENDED JUNE 30, 2016
Total revenues
Revenues:
Special assessments
Intergovernmental
Investment earnings
Other
Expenditures:
Debt service -
Principal retirement
Interest and fiscal charges
Bond issuance costs
Total expenditures
Excess (deficiency) of revenues over expenditures
Other financing sources (uses):
Sale of refunding bonds
Transfers in
Payment to bond escrow agent
Total other financing sources (uses):
Changes in fund balances
Fund balances, beginning of year
Fund balances (deficits), end of year
Municipal Debt Service
Budget
$
58,238
90,000
148,238
530,920
265,167
165,129
961,216
(812,978)
655,750
655,750
(157,228)
$(157,228)
Actual
$
33,470
42
100,916
134,428
530,920
265,167
104,533
900,620
(766,192)
2,529,250
655,750
(2,523,121)
661,879
(104,313)
166,799
$62,486
Variance -
Positive
(Negative)
$
(24,768)
42
10,916
(13,810)
60,596
60,596
46,786
2,529,250
(2,523,121)
6,129
52,915
166,799
$219,714
TOWN OF ORO VALLEY, ARIZONA
COMBINING SCHEDULE OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCES -
BUDGET AND ACTUAL
NON-MAJOR DEBT SERVICE FUNDS
YEAR ENDED JUNE 30, 2016
Oracle Road Debt Service
Budget
$ 175,153
175,153
145,000
33,384
178,384
(3,231)
3,000
3,000
(231)
$(231)
Actual
$ 189,525
189,525
145,000
42,503
187,503
2,022
3,000
3,000
5,022
1,946
$6,968
Variance -
Positive
(Negative)
$ 14,372
14,372
(9,119)
(9,119)
5,253
5,253
1,946
$7,199
Totals
Budget
$ 175,153
58,238
90,000
323,391
675,920
298,551
165,129
1,139,600
(816,209)
658,750
658,750
(157,459)
$(157,459)
Actual
$ 189,525
33,470
42
100,916
323,953
675,920
307,670
104,533
1,088,123
(764,170)
2,529,250
658,750
(2,523,121)
664,879
(99,291)
168,745
$69,454
Variance -
Positive
(Negative)
$ 14,372
(24,768)
42
10,916
562
(9,119)
60,596
51,477
52,039
2,529,250
(2,523,121)
6,129
58,168
168,745
$226,913
(This page intentionally left blank)
CAPITAL PROJECTS FUNDS
Capital Projects Funds are created to account for the purchase or construction of major capital
facilities which are not financed by the general, enterprise, or special revenue funds.
Townwide Roadway Development Impact Fees – to account for the collection and capital
expenditures of the Townwide Roadway Development Impact Fees.
General Impact Fees – accounts for the collection of development impact fees charged for new
residential and nonresidential growth to be used for future general government facilities, vehicles,
equipment, and other necessary general government infrastructure needed as a result of new
growth.
Townwide Facilities Projects – accounts for revenues dedicated to improvements to Town parks.
General Government CIP – to account for governmental capital asset projects.
PAG/RTA - to account for revenues dedicated to Town improvements funded through Pima
Association of Governments and the Regional Transportation Authority.
ASSETS
Cash and cash equivalents
Intergovernmental receivable
Total assets
LIABILITIES AND FUND BALANCES
Liabilities:
Accounts payable
Total liabilities
Fund balances:
Restricted
Committed
Assigned
Total fund balances
Total liabilities and fund balances
Townwide
Roadway
Development
Impact Fees
$ 3,215,815
$3,215,815
$740
740
3,215,075
3,215,075
$3,215,815
General Impact
Fees
$ 719,683
$719,683
$10,590
10,590
709,093
709,093
$719,683
Townwide
Facilities
Projects
$ 15,718
$15,718
$
15,718
15,718
$15,718
TOWN OF ORO VALLEY, ARIZONA
COMBINING BALANCE SHEET - NON-MAJOR CAPITAL PROJECTS FUNDS
JUNE 30, 2016
General
Government CIP
$ 829,066
$829,066
$110,057
110,057
719,009
719,009
$829,066
PAG/RTA
$ 163,332
648,482
$811,814
$189,832
189,832
621,982
621,982
$811,814
Totals
$ 4,943,614
648,482
$5,592,096
$311,219
311,219
3,924,168
15,718
1,340,991
5,280,877
$5,592,096
Revenues:
Development impact fees
Intergovernmental
Investment earnings
Other
Total revenues
Expenditures:
Current -
Public safety
Capital outlay
Total expenditures
Excess (deficiency) of revenues over expenditures
Other financing sources (uses):
Transfers in
Total other financing sources (uses):
Changes in fund balances
Fund balances, beginning of year
Fund balances, end of year
Townwide
Roadway
Development
Impact Fees
$ 531,697
8,120
539,817
2,594
2,594
537,223
537,223
2,677,852
$3,215,075
General Impact
Fees
$ 263,774
1,454
265,228
45,118
45,118
220,110
220,110
488,983
$709,093
Townwide
Facilities
Projects
$
21,728
21,728
12,200
12,200
9,528
9,528
6,190
$15,718
TOWN OF ORO VALLEY, ARIZONA
COMBINING STATEMENT OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCES -
NON-MAJOR CAPITAL PROJECTS FUNDS
YEAR ENDED JUNE 30, 2016
General
Government CIP
$
1,730,860
1,730,860
(1,730,860)
1,028,276
1,028,276
(702,584)
1,421,593
$719,009
PAG/RTA
$
3,490,035
22,500
3,512,535
40,505
2,850,048
2,890,553
621,982
621,982
$621,982
Totals
$ 795,471
3,490,035
9,574
44,228
4,339,308
40,505
4,640,820
4,681,325
(342,017)
1,028,276
1,028,276
686,259
4,594,618
$5,280,877
Total revenues
Revenues:
Development impact fees
Intergovernmental
Investment earnings
Other
Expenditures:
Current -
Public safety
Capital outlay
Total expenditures
Excess (deficiency) of revenues over expenditures
Other financing sources (uses):
Transfers in
Transfers out
Total other financing sources (uses):
Changes in fund balances
Fund balances, beginning of year
Fund balances (deficits), end of year
Townwide Roadway Development Impact Fees
Budget
$ 424,532
2,000
426,532
3,143,049
3,143,049
(2,716,517)
(460,696)
(460,696)
(3,177,213)
$(3,177,213)
Actual
$ 531,697
8,120
539,817
2,594
2,594
537,223
537,223
2,677,852
$3,215,075
Variance -
Positive
(Negative)
$ 107,165
6,120
113,285
3,140,455
3,140,455
3,253,740
460,696
460,696
3,714,436
2,677,852
$6,392,288
TOWN OF ORO VALLEY, ARIZONA
COMBINING SCHEDULE OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCES -
BUDGET AND ACTUAL
NON-MAJOR CAPITAL PROJECTS FUNDS
YEAR ENDED JUNE 30, 2016
General Impact Fees
Budget
$ 268,117
268,117
757,242
757,242
(489,125)
(489,125)
$(489,125)
Actual
$ 263,774
1,454
265,228
45,118
45,118
220,110
220,110
488,983
$709,093
Variance -
Positive
(Negative)
$ (4,343)
1,454
(2,889)
712,124
712,124
709,235
709,235
488,983
$1,198,218
Townwide Facilities Projects
Budget
$
143,246
143,246
(143,246)
(143,246)
$(143,246)
Actual
$
21,728
21,728
12,200
12,200
9,528
9,528
6,190
$15,718
Variance -
Positive
(Negative)
$
21,728
21,728
131,046
131,046
152,774
152,774
6,190
$158,964
(Continued)
Total revenues
Revenues:
Development impact fees
Intergovernmental
Investment earnings
Other
Expenditures:
Current -
Public safety
Capital outlay
Total expenditures
Excess (deficiency) of revenues over expenditures
Other financing sources (uses):
Transfers in
Transfers out
Total other financing sources (uses):
Changes in fund balances
Fund balances, beginning of year
Fund balances (deficits), end of year
General Government CIP
Budget
$
81,000
81,000
3,035,000
3,035,000
(2,954,000)
1,539,000
1,539,000
(1,415,000)
$(1,415,000)
Actual
$
1,730,860
1,730,860
(1,730,860)
1,028,276
1,028,276
(702,584)
1,421,593
$719,009
Variance -
Positive
(Negative)
$
(81,000)
(81,000)
1,304,140
1,304,140
1,223,140
(510,724)
(510,724)
712,416
1,421,593
$2,134,009
TOWN OF ORO VALLEY, ARIZONA
COMBINING SCHEDULE OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCES -
BUDGET AND ACTUAL
NON-MAJOR CAPITAL PROJECTS FUNDS
YEAR ENDED JUNE 30, 2016
PAG/RTA
Budget
$
10,414,000
22,500
500
10,437,000
10,897,696
10,897,696
(460,696)
460,696
460,696
$
Actual
$
3,490,035
22,500
3,512,535
40,505
2,850,048
2,890,553
621,982
621,982
$621,982
Variance -
Positive
(Negative)
$
(6,923,965)
(22,500)
22,000
(6,924,465)
(40,505)
8,047,648
8,007,143
1,082,678
(460,696)
(460,696)
621,982
$621,982
Totals
Budget
$ 692,649
10,495,000
24,500
500
11,212,649
17,976,233
17,976,233
(6,763,584)
1,999,696
(460,696)
1,539,000
(5,224,584)
$(5,224,584)
Actual
$ 795,471
3,490,035
9,574
44,228
4,339,308
40,505
4,640,820
4,681,325
(342,017)
1,028,276
1,028,276
686,259
4,594,618
$5,280,877
Variance -
Positive
(Negative)
$ 102,822
(7,004,965)
(14,926)
43,728
(6,873,341)
(40,505)
13,335,413
13,294,908
6,421,567
(971,420)
460,696
(510,724)
5,910,843
4,594,618
$10,505,461
(This page intentionally left blank)
INTERNAL SERVICE FUNDS
Self Insurance - to account for the financial activity associated with the Town’s self-insurance
program for employee health care.
Fleet Maintenance - to account for the Town’s fleet maintenance services.
ASSETS
Current assets:
Cash and cash equivalents
Accounts receivable
Total current assets
Total assets
DEFERRED OUTFLOWS OF RESOURCES
Pension plan items
LIABILITIES
Current liabilities:
Accounts payable
Claims payable
Total current liabilities
Noncurrent liabilities:
Non-current portion of long-term obligations
Total noncurrent liabilities
Total liabilities
DEFERRED INFLOWS OF RESOURCES
Pension plan items
NET POSITION
Unrestricted
Total net position
Fleet
Maintenance
$ 569,439
569,439
569,439
13,911
43,346
43,346
99,606
99,606
142,952
10,141
430,257
$430,257
Self Insurance
$ 236,441
75,068
311,509
311,509
31,273
249,036
280,309
280,309
31,200
$31,200
Totals
$ 805,880
75,068
880,948
880,948
13,911
74,619
249,036
323,655
99,606
99,606
423,261
10,141
461,457
$461,457
TOWN OF ORO VALLEY, ARIZONA
COMBINING STATEMENT OF NET POSITION -
ALL INTERNAL SERVICE FUNDS
JUNE 30, 2016
Operating revenues:
Charges for services
Other
Self insurance premiums
Total operating revenues
Operating expenses:
Costs of sales and services
Claims payments
Administrative fees
Reinsurance premiums
Total operating expenses
Operating income (loss)
Changes in net position
Total net postion, beginning of year
Total net position, end of year
Fleet
Maintenance
$ 1,363,351
77,074
1,440,425
1,171,192
1,171,192
269,233
269,233
161,024
$430,257
Self Insurance
$
3,015,655
3,015,655
25,273
2,513,124
57,000
633,220
3,228,617
(212,962)
(212,962)
244,162
$31,200
Totals
$ 1,363,351
77,074
3,015,655
4,456,080
1,196,465
2,513,124
57,000
633,220
4,399,809
56,271
56,271
405,186
$461,457
TOWN OF ORO VALLEY, ARIZONA
COMBINING STATEMENT OF REVENUES, EXPENSES AND CHANGES IN FUND NET POSITION -
ALL INTERNAL SERVICE FUNDS
FOR THE YEAR ENDED JUNE 30, 2016
Fleet Maintenance Self Insurance Total
Increase (Decrease) in Cash and Cash Equivalents
Cash flows from operating activities:
Cash received from customers 1,440,425$ 1,440,425$
Cash received from premiums 2,940,587 2,940,587
Cash payments to suppliers for goods and services (1,104,811) (623,989) (1,728,800)
Cash payments to employees for services (65,097)(65,097)
Cash payments for claims (2,513,124) (2,513,124)
Net cash provided by (used for) operating activities 270,517 (196,526)73,991
Net increase (decrease) in cash and cash equivalents 270,517 (196,526)73,991
Cash and cash equivalents, beginning of year 298,922 432,967 731,889
Cash and cash equivalents, end of year 569,439$ 236,441$ 805,880$
Reconciliation of Operating Income (Loss) to
Net Cash Provided by (Used for) Operating Activities
Operating income (loss)269,233$ (212,962)$ 56,271$
Adjustments to reconcile operating income (loss)
to net cash provided by (used for) operating activities:
Change in assets and liabilities:
Accounts receivable (75,068)(75,068)
Accounts payable 2,126 5,169 7,295
Claims payable 86,335 86,335
Pension items (842)(842)
Total adjustments 1,284 16,436 17,720
Net cash provided by (used for) operating activities 270,517$ (196,526)$ 73,991$
TOWN OF ORO VALLEY, ARIZONA
COMBINING STATEMENT OF CASH FLOWS
ALL INTERNAL SERVICE FUNDS
FOR THE YEAR ENDED JUNE 30, 2016
STATISTICAL SECTION
The statistical section presents financial statement trends as well as detailed financial and
operational information not available elsewhere in the report. The statistical section is intended to
enhance the reader’s understanding of the information presented in the financial statements, notes
to the financial statements, and other supplementary information presented in this report. The
statistical section is comprised of the five categories of statistical information presented below.
Financial Trends
These schedules contain information on financial trends to help the reader understand how
the Town’s financial position and financial activities have changed over time.
Revenue Capacity
These schedules contain information to help the reader assess the factors affecting the
Town’s ability to generate property revenue.
Debt Capacity
These schedules present information to help the reader evaluate the Town’s current levels of
outstanding debt as well as assess the Town’s ability to make debt payments and/or issue
additional debt in the future.
Demographic and Economic Information
These schedules present various demographic and economic indicators to help the reader
understand the environment in which the Town’s financial activities take place and to help
make comparisons with other municipalities.
Operating Information
These schedules contain information about the Town’s operations and various resources to
help the reader draw conclusions as to how the Town’s financial information relates to the
services provided by the Town.
Note: For locally assessed property (i.e., excluding mines, utilities, etc.) Proposition 117, approved
by voters in 2012, amended the Arizona Constitution to require that all property taxes after fiscal
year 2014-15 be based upon property values limited to five percent in annual growth. The
aggregate assessed value of all taxable properties within a taxing jurisdiction (i.e., after applying
assessment ratios based on the use of a property), including property values with a growth limit,
is currently referred to as net limited assessed value and formerly as primary assessed value. In
accordance with Proposition 117, this value is used for all taxing purposes beginning fiscal year
2015-16. Aggregate assessed value without a growth limit is currently referred to as net full cash
assessed value and formerly as secondary assessed value. This remains the value utilized for
determining debt capacity limits.
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20122013201420152016Governmental activities Net investment in capital assets135,336,862$ 134,512,094$ 133,714,821$ 133,800,218$ 132,419,826$ Restricted11,454,390 3,730,312 4,555,138 3,599,966 4,653,905 Unrestricted10,808,596 18,901,112 18,430,146 (9,493,907) (10,883,206) Total governmental activities net position157,599,848$ 157,143,518$ 156,700,105$ 127,906,277$ 126,190,525$ Business-type activities Net investment in capital assets45,669,488$ 48,802,267$ 52,775,561$ 54,858,448$ 61,261,271$ Restricted Unrestricted19,067,780 19,501,676 21,541,202 20,092,694 19,504,748 Total business-type activities net position64,737,268$ 68,303,943$ 74,316,763$ 74,951,142$ 80,766,019$ Primary government Net investment in capital assets181,006,350$ 183,314,361$ 186,490,382$ 188,658,666$ 193,681,097$ Restricted11,454,390 3,730,312 4,555,138 3,599,966 4,653,905 Unrestricted29,876,376 38,402,788 39,971,348 10,598,787 8,621,542 Total primary government net position222,337,116$ 225,447,461$ 231,016,868$ 202,857,419$ 206,956,544$ Governmental activities20072008200920102011 Net investment in capital assets Restricted Unrestricted106,644,847$ 115,177,344$ 120,515,962$ 127,712,057$ 132,956,156$ 8,326,731 14,072,781 7,537,331 9,580,610 9,048,505 Total governmental activities net position23,571,109 26,698,611 26,135,593 15,979,093 10,588,160 Business-type activities138,542,687$ 155,948,736$ 154,188,886$ 153,271,760$ 152,592,821$ Net investment in capital assets Restricted Unrestricted15,534,043$ 21,274,023$ 28,212,750$ 31,383,715$ 40,005,568$ Total business-type activities net position23,252,747 24,651,948 24,393,984 24,404,427 20,371,225 Primary government38,786,790$ 45,925,971$ 52,606,734$ 55,788,142$ 60,376,793$ Net investment in capital assets Restricted Unrestricted122,178,890$ 136,451,367$ 148,728,712$ 159,095,772$ 172,961,724$ 8,326,731 14,072,781 7,537,331 9,580,610 9,048,505 Total primary government net position46,823,856 51,350,559 50,529,577 40,383,520 30,959,385 177,329,477$ 201,874,707$ 206,795,620$ 209,059,902$ 212,969,614$ Source: Town of Oro Valley Finance Department(UNAUDITED)TOWN OF ORO VALLEY, ARIZONANET POSITION BY COMPONENTLAST TEN FISCAL YEARS(ACCRUAL BASIS OF ACCOUNTING)
2007200820092010201120122013201420152016ExpensesGovernmental activities:General government7,529,245$ 9,080,766$ 9,936,639$ 9,950,053$ 9,887,523$ 9,961,376$ 9,861,131$ 10,990,007$ 11,533,702$ 11,888,794$ Public Safety12,352,671 14,347,250 15,019,980 13,730,593 12,509,201 12,349,948 12,770,224 13,814,914 16,587,168 16,123,500 Highways and streets7,757,276 7,292,972 9,481,040 9,353,689 8,895,987 9,339,062 9,255,004 8,754,110 9,400,140 9,089,318 Transit1,275,093 1,404,646 1,432,910 Culture and recreation3,375,314 3,644,973 3,806,555 3,527,949 3,375,281 3,227,895 2,783,633 3,399,623 4,572,490 9,695,639 Interest on long-term debt996,336 987,074 954,645 1,767,155 430,570 654,262 522,917 656,260 439,027 494,732 Total governmental activities/expenses32,010,842 35,353,035 39,198,859 38,329,439 35,098,562 35,532,543 35,192,909 38,890,007 43,937,173 48,724,893 Business-type activities:Water11,446,958 12,676,275 13,495,124 12,830,137 12,527,851 11,984,829 13,047,373 13,572,677 13,608,931 14,406,074 Stormwater drainage74,235 177,673 494,166 486,994 586,006 636,966 983,975 749,038 854,510 917,898 Total business-type activities expenses11,521,193 12,853,948 13,989,290 13,317,131 13,113,857 12,621,795 14,031,348 14,321,715 14,463,441 15,323,972 Total primary government expenses43,532,035$ 48,206,983$ 53,188,149$ 51,646,570$ 48,212,419$ 48,154,338$ 49,224,257$ 53,211,722$ 58,400,614$ 64,048,865$ Program RevenuesGovernmental activities:Fees, Fines and Charges for Services:General government3,291,983$ 3,830,060$ 2,835,884$ 2,261,815$ 2,455,182$ 3,079,526$ 3,740,046$ 3,978,117$ 3,516,359$ 4,096,927$ Public Safety229,546 69,256 83,279 28,785 33,976 33,109 45,346 35,976 29,097 168,808 Highways and streets122,124 211,088 119,847 137,436 400,977 329,420 1,052,581 546,066 496,098 764,397 Transit71,078 72,783 88,684 Culture and recreation121,358 73,149 110,857 119,273 126,290 82,832 169,965 435,354 1,108,734 4,373,693 Operating grants and contributions4,893,869 5,619,003 5,392,667 4,728,050 4,887,283 5,247,844 5,318,097 4,706,844 5,070,396 5,503,530 Capital grants and contributions8,321,691 10,264,829 1,781,571 6,514,602 8,980,239 7,107,063 2,920,335 2,919,641 2,456,727 3,602,656 Total governmental activities program revenues16,980,571 20,067,385 10,324,105 13,789,961 16,883,947 15,879,794 13,246,370 12,693,076 12,750,194 18,598,695 Business-type activities:Charges for services:Water 13,617,336 16,803,950 16,098,086 15,136,784 15,119,065 15,817,345 16,732,600 19,286,794 16,088,681 16,739,580 Stormwater Utility125 357,602 746,655 927,238 888,391 752,212 813,400 759,428 771,594 828,258 Operating grants and contributions35,000 Capital grants and contributions3,066,170 3,567,083 3,697,229 362,273 1,655,307 245,607 48,871 179,675 1,979,037 3,334,372 Total business-type activities program revenues 16,683,631 20,728,635 20,541,970 16,426,295 17,662,763 16,815,164 17,594,871 20,225,897 18,839,312 20,937,210 Total primary government program revenues33,664,202$ 40,796,020$ 30,866,075$ 30,216,256$ 34,546,710$ 32,694,958$ 30,841,241$ 32,918,973$ 31,589,506$ 39,535,905$ (ACCRUAL BASIS OF ACCOUNTING)(UNAUDITED)TOWN OF ORO VALLEY, ARIZONACHANGES IN NET POSITIONLAST TEN FISCAL YEARS
2007200820092010201120122013201420152016Net (Expense)/RevenuesGovernmental activities(15,030,271)$ (15,285,650)$ (28,874,754)$ (24,539,478)$ (18,214,615)$ (19,652,749)$ (21,946,539)$ (26,196,931)$ (31,186,979)$ (30,126,198)$ Business-type activities5,162,438 7,874,687 6,552,680 3,109,164 4,548,906 4,193,369 3,563,523 5,904,182 4,375,871 5,613,238 Total primary government net expenses(9,867,833)$ (7,410,963)$ (22,322,074)$ (21,430,314)$ (13,665,709)$ (15,459,380)$ (18,383,016)$ (20,292,749)$ (26,811,108)$ (24,512,960)$ General Revenues and Other Changes in Net PositionGovernmental activities:Taxes:Sales taxes16,873,630$ 17,168,998$ 15,376,408$ 12,970,865$ 11,572,148$ 12,799,678$ 14,241,065$ 15,286,001$ 16,132,159$ 16,998,464$ Franchise taxes478,175 516,652 506,685 509,285 514,814 525,427 539,477 571,731 582,064 621,546 Impact fees*1,038,217 910,741 441,020 584,113 Unrestricted state revenue sharing4,473,305 5,544,763 5,886,132 5,086,953 4,520,935 3,461,359 9,048,365 9,636,906 10,413,464 10,549,196 Unrestricted state sales tax revenue sharing3,744,864 3,621,016 3,134,789 2,891,386 2,569,666 3,204,612 Unrestricted auto lieu tax revenue sharing1,726,149 1,738,875 1,655,875 1,484,125 1,318,989 1,479,094 Special assessmentsInvestment earnings (loss)1,471,641 1,590,654 113,995 95,625 39,124 189,606 265,787 255,702 216,175 238,210 Special item - Capital asset conveyance(2,606,804) Transfers 69,813 1,600,000 2,319 3,178 3,119 3,030 Total governmental activities 29,875,794 32,691,699 27,114,904 23,622,352 20,535,676 21,659,776 21,490,209 25,753,518 27,346,981 28,410,446 Business-type activities:Investment earnings (loss) 1,163,837 864,494 128,083 72,244 39,745 167,106 5,471 111,816 124,887 204,669 Transfers (69,813) (1,600,000) (2,319) (3,178) (3,119) (3,030) Total business-type activities 1,094,024 (735,506) 128,083 72,244 39,745 167,106 3,152 108,638 121,768 201,639 Total primary government 30,969,818$ 31,956,193$ 27,242,987$ 23,694,596$ 20,575,421$ 21,826,882$ 21,493,361$ 25,862,156$ 27,468,749$ 28,612,085$ Change in Net PositionGovernmental activities 14,845,523$ 17,406,049$ (1,759,850)$ (917,126)$ 2,321,061$ 2,007,027$ (456,330)$ (443,413)$ (3,839,998)$ (1,715,752)$ Business-type activities 6,256,462 7,139,181 6,680,763 3,181,408 4,588,651 4,360,475 3,566,675 6,012,820 4,497,639 5,814,877 Total primary government 21,101,985$ 24,545,230$ 4,920,913$ 2,264,282$ 6,909,712$ 6,367,502$ 3,110,345$ 5,569,407$ 657,641$ 4,099,125$ Source: Town of Oro Valley Finance Department* Impact fees in fiscal year 2011 are now presented in program revenues.
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2007200820092010201120122013201420152016General FundNonspendable$$$$$$$$31,278$ 97,269$ RestrictedCommittedAssigned1,769,333 1,608,035 1,608,035 1,608,035 1,553,999 1,441,862 Unassigned9,237,805 9,793,614 11,529,070 9,925,988 8,566,598 8,985,422 ReservedUnreserved18,477,706 16,666,388 15,940,438 11,904,429 Total general fund18,477,706$ 16,666,388$ 15,940,438$ 11,904,429$ 11,007,138$ 11,401,649$ 13,137,105$ 11,534,023$ 10,151,875$ 10,524,553$ All Other Governmental FundsNonspendable$$$$$$$$149,348$ 127,600$ Restricted9,128,505 11,454,390 3,730,312 4,555,138 3,599,966 4,031,923 Committed 840,704 622,919 4,166,818 5,343,506 4,637,773 2,617,856 Assigned1,500,000 1,421,593 1,340,991 Unassigned(29,198) ReservedUnreserved, reported in:Special revenue funds4,891,095 5,534,192 5,887,082 5,868,523 Capital projects funds4,520,718 15,396,024 9,071,398 3,933,044 Debt service funds245,208 263,478 158,816 1,929,635 Total all other governmental funds9,657,021$ 21,193,694$ 15,117,296$ 11,731,202$ 9,969,209$ 12,077,309$ 7,897,130$ 11,398,644$ 9,808,680$ 8,089,172$ Source: Town of Oro Valley Finance DepartmentNote:(MODIFIED ACCRUAL BASIS OF ACCOUNTING)(UNAUDITED)The provisions of the Governmental Accounting Standards Board (GASB) Statement No. 54 were adopted in fiscal year 2011. The standard replaces the previous reserved and unreserved fundbalance categories with the following five fund balance classifications; nonspendable, restricted, committed, assigned, and unassigned fund balance.Fiscal YearTOWN OF ORO VALLEY, ARIZONAFUND BALANCES OF GOVERNMENTAL FUNDSLAST TEN FISCAL YEARS
2007200820092010201120122013201420152016RevenuesTaxes 17,351,805$ 17,685,650$ 15,883,093$ 13,480,150$ 12,086,962$ 13,325,105$ 14,780,542$ 15,857,732$ 16,714,223$ 17,620,010$ Intergovernmental18,405,713 21,863,875 17,616,213 17,940,749 18,040,619 19,723,086 16,817,756 16,732,631 17,714,991 19,488,066 Fines and forfeitures429,458 391,921 413,720 612,031 560,941 895,820 551,962 673,336 221,571 283,470 Licenses and permits2,368,851 2,792,684 1,507,930 1,108,411 1,059,309 1,185,862 1,813,947 2,116,700 1,605,937 1,915,992 Charges for services1,026,921 1,040,694 1,066,376 965,455 926,135 1,209,814 1,630,238 1,850,181 2,991,826 5,956,058 Contributions and donations19,171 249,999 1,000 59 15,000 995 27,229 149,513 Special assessments189,820 193,023 367,539 368,152 365,811 366,028 365,935 1,462,307 178,078 189,525 Impact fees1,038,217 910,741 441,020 584,113 481,619 417,742 988,342 569,338 439,637 795,471 Investment earnings1,471,641 1,590,654 113,995 95,625 39,124 189,606 265,787 255,702 216,175 238,210 Other revenues135,261 555,790 233,123 216,030 297,109 460,512 349,326 305,489 141,618 504,796 Total revenues42,436,858$ 47,275,031$ 37,644,009$ 35,370,775$ 33,872,629$ 37,774,570$ 37,591,064$ 39,823,416$ 40,224,056$ 47,141,111$ ExpendituresGeneral government7,019,030$ 8,767,496$ 9,586,029$ 9,452,778$ 9,848,393$ 9,212,866$ 9,289,771$ 10,610,673$ 10,862,553$ 11,426,687$ Public safety11,808,799 13,549,170 14,289,423 12,979,291 11,928,567 11,993,864 12,342,349 13,539,322 15,071,396 15,494,532 Highways and streets3,768,851 4,107,871 3,848,725 3,475,556 3,288,349 3,191,654 3,513,479 3,710,577 2,602,321 2,754,413 Transit1,404,646 1,432,910 Culture and recreation3,109,228 3,324,066 3,416,305 3,157,369 3,031,520 2,954,549 2,468,129 2,445,131 4,078,817 9,097,752 Capital Outlay10,662,190 13,090,313 11,332,914 3,189,765 7,014,659 6,929,834 11,053,739 5,495,185 8,093,704 7,995,340 Debt ServicePrincipal retirement1,077,813 3,403,102 938,900 3,400,877 3,459,970 3,052,953 571,910 1,867,901 649,840 897,637 Interest and fiscal charges921,205 907,658 1,034,061 831,580 470,578 554,274 498,729 472,268 436,010 336,510 Payment to bond escrow agent6,279,112 Bond Issuance costs 28,868 26,550 75,800 104,533 Total expenditures 38,395,984$ 47,149,676$ 44,446,357$ 42,792,878$ 39,042,036$ 37,965,794$ 39,738,106$ 38,141,057$ 43,199,287$ 49,540,314$ Excess of revenues4,069,742$ 125,355$ (6,802,348)$ (7,395,553)$ (5,169,407)$ (115,424)$ (2,147,042)$ 1,682,359$ (2,975,231)$ (2,399,203)$ over (under) expendituresOther Financing Sources (Uses)Premium on bonds issued25,719$ $$$$113,835$ $$$$Proceeds from capital lease agreements212,895 1,043,214 Issuance of long-term loan payable8,000,000 Issuance of refunding debt1,389,180 Payment to bond escrow agent(1,540,438) (2,523,121) Issuance of long-term debt2,445,000 2,580,000 2,529,250 Transfers in2,927,754 8,447,951 1,950,898 10,012,679 860,143 1,003,666 1,704,272 4,115,152 4,326,627 1,872,026 Transfers out(2,857,941) (6,847,951) (1,950,898) (10,012,679) (795,020) (1,003,666) (2,001,953) (4,111,974) (4,323,508) (1,868,996) Total other financing sources (uses)(55,726)$ 9,600,000$ $ $ 2,510,123$ 2,693,835$ (297,681)$ 216,073$ 3,119$ 1,052,373$ Net change in fund balances4,014,016$ 9,725,355$ (6,802,348)$ (7,395,553)$ (2,659,284)$ 2,578,411$ (2,444,723)$ 1,898,432$ (2,972,112)$ (1,346,830)$ Debt service as a percentage of7.17%12.36%5.88%10.60%12.36%11.55%3.76%7.30%3.17%3.00%noncapital expendituresSource: Town of Oro Valley Finance DepartmentLAST TEN FISCAL YEARS(MODIFIED ACCRUAL BASIS OF ACCOUNTING)(UNAUDITED)Fiscal YearTOWN OF ORO VALLEY, ARIZONACHANGES IN FUND BALANCES OF GOVERNMENTAL FUNDS
20162007PercentagePercentageof Total Townof Total TownEmployerEmployees Rank Employment Employees Rank EmploymentVentana Medical Systems 1,400 1 8.00% 566 2 3.81%Oro Valley Hospital 602 2 3.44%Town of Oro Valley 529 4 3.02% 333 5 2.24%Amphitheater Public Schools 549 3 3.14% 646 1 4.35%Hilton El Conquistador Golf & Tennis Resort 345 5 1.97% 440 4 2.96%Fry's Food & Drug Store 235 6 1.34% 270 6 1.82%Walmart Supercenter 229 7 1.31%Splendido at Rancho Vistoso 188 8 1.07%Securaplane 167 9 0.95%Target 150 10 0.86%Home Depot 125 11 0.71% 160 8 1.08%Northwest Medical Center450 3 3.03%Hilton El Conquistador Country Club260 7 1.75%Northwest Medical Center - Urgent Care150 9 1.01%Stone Canyon Golf/Golf Club at Vistoso130 10 0.88%Total 4,519 25.82% 3,405 22.93%Source: U.S. Bureau of Labor StatisticsTOWN OF ORO VALLEY, ARIZONAPRINCIPAL EMPLOYERS(UNAUDITED)CURRENT FISCAL YEAR AND FISCAL YEAR NINE YEARS PRIOR
Fiscal Year 2016Fiscal Year 2007Percentage ofPercentage ofSales TaxTotal SalesSales TaxTotal SalesTaxpayerBusiness TypePaymentsRankTax PaymentsPaymentsRankTax PaymentsTaxpayer AUtility1,916,534$ 111.91%Taxpayer B Retail Trade1,016,496 36.32%Taxpayer C Retail Trade812,055 45.05%655,622$ 34.35%Taxpayer DUtility513,229 53.19%Taxpayer E Construction388,577 92.41%Taxpayer FUtility441,352 72.74%Taxpayer G Retail Trade489,898 63.04%614,468 44.07%Taxpayer H Retail Trade429,809 82.67%275,414 9Taxpayer I Accomodation1,169,909 27.27%1,703,376 111.29%Taxpayer J Retail Trade354,280 102.20%0.00%Taxpayer K Construction928,022 26.15%Taxpayer L Construction578,400 53.83%Taxpayer M Construction500,055 63.32%Taxpayer N Retail Trade265,527 101.76%Taxpayer O Construction333,524 72.21%Taxpayer P Construction314,233 82.08%Total7,532,139$ 46.81%6,168,641$ 39.07%Source: Arizona Department of RevenueTOWN OF ORO VALLEY, ARIZONAPRINCIPAL SALES TAXPAYERSCURRENT FISCAL YEAR AND FISCAL YEAR NINE YEARS PRIOR(UNAUDITED)
2007 2008 2009 2010 2011 2012 2013 2014 20152016Construction6,895$ 7,038$ 5,143$ 2,110$ 1,707$ 1,738$ 2,842$ 3,338$ 3,199$ 2,131$ Manufacturing181 280 230 230 266 258 258 257 141 156 Transportation, Warehousing, Communications & Utilities226 1,279 1,632 1,554 1,534 2,450 2,785 2,959 3,068 3,133 Wholesale Trade58 69 54 75 93 106 110 103 125 131 Retail Trade3,665 4,017 4,264 4,544 4,720 4,925 5,153 5,243 5,808 6,844 Restaurants, Bars & Lodging2,720 2,775 2,333 2,283 2,314 2,314 2,164 2,761 2,803 3,295 Finance, Insurance & Real Estate859 496 324 381 324 333 335 75 270 443 Services313 312 322 378 417 456 456 529 599 672 All Other 167 337 896 627 102 103 75 60 115 190 Cable Franchise478 517 507 509 515 525 540 572 582 622 Total15,562$ 17,120$ 15,705$ 12,691$ 11,992$ 13,208$ 14,718$ 15,897$ 16,710$ 17,617$ Town sales tax rate*2.00% 2.00% 2.00% 2.00% 2.00% 2.00% 2.00% 2.00% 2.50% 2.50%Source: Arizona Department of Revenue*Note:1% Additional Bed Tax Effective May 1, 19903% Additional Bed Tax Effective September 1, 20014% Construction Sales Tax Effective May 1, 20046% Additional Bed Tax Effective January 1, 20062% Utility Sales Tax Effective April 1, 20072% Additional Utility Sales Tax Effective August 1, 2011.5% Additional sales tax effective March 1, 2015Fiscal YearTOWN OF ORO VALLEY, ARIZONATAXABLE SALES BY CATEGORYLAST TEN FISCAL YEARS (UNAUDITED)($000's)
Town of Oro
Town of Oro Town of Oro Valley Town of Oro
Fiscal Valley Valley Construction Valley
Year Sales Tax Bed Tax Sales Tax Utility Sales Tax Pima County
2007 2.00% 6.00% 4.00% 2.00% 6.10%
2008 2.00% 6.00% 4.00% 2.00% 6.10%
2009 2.00% 6.00% 4.00% 2.00% 6.10%
2010 2.00% 6.00% 4.00% 2.00% 7.10%
2011 2.00% 6.00% 4.00% 2.00% 7.10%
2012 2.00% 6.00% 4.00% 4.00% 7.10%
2013 2.00% 6.00% 4.00% 4.00% 6.10%
2014 2.00% 6.00% 4.00% 4.00% 6.10%
2015* 2.50% 6.00% 4.00% 4.00% 6.10%
2016 2.50% 6.00% 4.00% 4.00% 6.10%
*.5% Additional sales tax effective March 1, 2015
Source: Arizona Department of Revenue
TOWN OF ORO VALLEY, ARIZONA
DIRECT AND OVERLAPPING SALES TAX RATES
LAST TEN FISCAL YEARS
(UNAUDITED)
Year
Limited Assessed
Valuation
Full Cash
Assesed
Valuation
Estimated Full
Cash Value
Total
Outstanding
General
Obligation Bond
Debt
2007 515,095,975 582,838,439 5,098,720,276 0
2008 582,236,657 686,707,506 6,141,419,229 0
2009 642,601,840 693,924,598 6,140,054,657 0
2010 649,015,575 672,309,638 6,041,904,306 0
2011 618,976,953 629,340,548 5,716,229,517 0
2012 589,160,533 592,761,968 5,461,131,133 0
2013 553,366,744 556,259,856 5,175,406,955 0
2014 556,566,167 560,863,509 5,252,917,489 0
2015 572,696,599 593,299,222 5,616,655,680 0
2016 593,580,247 616,216,705 5,688,443,027 0
Source: State of Arizona Department of Revenue Abstract of the Assessment Roll
Note:
TOWN OF ORO VALLEY, ARIZONA
LIMITED & FULL CASH ASSESSED PROPERTY VALUES
LAST TEN FISCAL YEARS
(UNAUDITED)
Beginning in FY 2016, due to Proposition 117, the primary (limited assessed valuation) is to be used by
municipalities when levying for maintenance and operation and for debt retirement. Prior to that date, the
secondary (full cash) assessed valuation was used when levying for debt retirement, voter-approved
budget overrides, and maintenance and operation of special service districts.
FiscalFiscalFiscalFiscalFiscalFiscalFiscalFiscalFiscalFiscalYearYearYearYearYearYearYearYearYearYearRevenue Source2009201020112012201320142015201620172018Town Sales and Franchise Taxes 15,883,093$ 13,480,150$ 12,086,962$ 13,325,106$ 14,780,543$ 15,857,732$ 16,714,223$ 17,620,010$ 18,148,610$ 18,693,069$ Licenses and Permits1,507,930 1,108,411 1,059,309 1,185,862 1,813,947 2,116,700 1,605,937 1,915,992 1,973,472 2,032,676 Fines285,628 202,144 195,933 200,672 180,875 172,232 148,050 283,470 291,974 300,733 State-Shared Sales Tax3,134,789 2,891,386 3,024,857 3,204,612 3,356,826 3,569,711 3,747,944 3,887,673 4,004,303 4,124,432 State-Shared Income Tax5,886,132 5,086,954 3,834,911 3,461,359 4,189,186 4,571,196 4,964,635 4,937,719 5,085,851 5,238,426 Total26,697,572$ 22,769,045$ 20,201,972$ 21,377,611$ 24,321,377$ 26,287,571$ 27,180,789$ 28,644,864$ 29,504,211$ 30,389,336$ (a) All revenue sources are presented on a modified accrual basis of accounting except for Town sales taxes which are presented on the cash basis of accounting per the Arizona Department of Revenue Standard Industry Summary Local Taxes Collection Reports.Source: Oro Valley Finance DepartmentNote: The above information is provided for bond requirements only and the bond does not require ten years of data.TOWN OF ORO VALLEY, ARIZONAHISTORICAL AND PROJECTED EXCISE TAX COLLECTIONSJUNE 30, 2016(UNAUDITED)ProjectedAcutal
Business-Type ActivitiesSpecialTotal PercentageFiscal Capital Note Loan Excise TaxAssessmentRevenueCapital Loan Primaryof Personal PerYearLeases PayablePayableBonds BondsBondsLeases PayableGovernmentIncome Capita2007$ $ 2,500,000$ 12,891,148$ 3,760,000$ 61,568,852$ 80,720,000$ 4.81% 1,897$ 20088,000,000 12,183,046 3,565,000 59,586,954 5,731,766 89,066,766 5.02% 2,040 20098,000,000 11,449,146 3,360,000 57,575,854 107,046 5,788,122 86,280,168 4.72% 1,975 20105,513,133 4,939,750 3,145,000 52,305,500 123,883 6,305,650 72,332,916 3.86% 1,662 20112,513,133 7,149,780 2,920,000 49,803,970 35,392 5,473,096 67,895,371 3.73% 1,656 20129,485,968 2,685,000 45,988,331 5,893,122 64,052,421 3.85% 1,550 20139,155,743 2,435,000 43,349,121 185,307 5,575,041 60,700,212 3.59% 1,409 2014168,994 8,703,428 1,055,000 40,811,243 93,593 6,371,529 57,203,787 3.41% 1,366 2015128,594 1,000,000 8,215,673 925,000 37,683,805 118,862 8,169,765 56,241,699 3.25% 1,331 2016966,962 700,000 7,716,638 780,000 34,517,647 80,423 8,879,907 53,641,577 2.95% 1,231 Source: Town of Oro Valley Finance Department and U.S. Census BureauTOWN OF ORO VALLEY, ARIZONARATIO OF OUTSTANDING DEBT BY TYPELAST TEN FISCAL YEARS (UNAUDITED)Governmental Activities
Estimated
Estimated Share of
Debt Percentage Overlapping
Governmental Unit Outstanding Applicable Debt
Pima County 350,135,000$ 7.50% 26,260,125$
Pima County Community College District - 7.50%-
Amphitheater Unified School District No. 10 91,035,000 18.43% 16,777,751
Total Overlapping 43,037,876
Town of Oro Valley 10,163,330 100.00% 10,163,330
Total Direct 10,163,330
Total direct and overlapping debt 53,201,206$
Source: Pima County, Pima County Community College District and Amphitheater Unified School District No. 10.
(1) Proportion applicable to the Town of Oro Valley, Arizona, is computed on the ratio of secondary
assessed valuation for 2015-16.
TOWN OF ORO VALLEY, ARIZONA
DIRECT AND OVERLAPPING GOVERNMENTAL ACTIVITIES DEBT
JUNE 30, 2016
(UNAUDITED)
2007200820092010201120122013201420152016Debt Limit120,435,053$ 151,537,994$ 178,543,952$ 180,420,396$ 174,800,436$ 163,628,543$ 154,118,112$ 144,627,563$ 145,824,512$ 154,257,798$ Total net debt applicable to limitLegal debt margin108,807,180$ 120,435,053$ 151,537,994$ 178,543,952$ 180,420,396$ 174,800,436$ 163,628,543$ 154,118,112$ 145,824,512$ 154,257,798$ Total net debt applicable to the limitas a percentage of debt limit0.00%0.00%0.00%0.00%0.00%0.00%0.00%0.00%0.00%0.00%Source: Town of Oro Valley Finance DepartmentFiscal YearTOWN OF ORO VALLEY, ARIZONALEGAL DEBT MARGIN INFORMATIONLAST TEN FISCAL YEARS(UNAUDITED)
Net secondary assessed valuation 593,299,222$
Water, Sewer, Light, Parks, Open Space and
Recreational Facility Bonds
Debt limit - 20% of secondary net assessed valuation 118,659,844$
Debt applicable to limit
General obligation bonds outstanding $
Less amount set aside for repayment of debt
Net debt applicable to limit
20% legal debt margin 118,659,844$
All other general obligation bonds
Debt Limit - 6% of secondary net assessed valuation 35,597,953$
Debt applicable to limit
General obligation bonds outstanding $
Less amount set aside for repayment of debt
Net debt applicable to limit
All other general obligation bonds debt margin 35,597,953$
Total legal debt margin 154,257,798$
Source: Pima County Assessor's Office
TOWN OF ORO VALLEY
CALCULATION OF LEGAL DEBT MARGIN
JUNE 30, 2016
(UNAUDITED)
Water Utility Revenue Bonds
Fiscal Gross
Year Revenues Principal Interest Total Coverage
2007 14,810,173$ 2,336,330$ 2,552,081$ 4,888,411$ 3.03
2008 17,668,212 1,981,898 2,452,583 4,434,481 3.98
2009 16,223,544 2,011,100 2,784,444 4,795,544 3.38
2010 15,207,113 5,270,354 2,689,427 7,959,781 1.91
2011 15,359,681 2,501,530 2,505,960 5,007,490 3.07
2012 15,983,999 2,370,180 2,190,894 4,561,074 3.50
2013 16,732,600 2,536,840 1,732,008 4,268,848 3.92
2014 19,397,409 2,406,000 1,429,538 3,835,538 5.06
2015 16,213,273 2,995,560 1,372,024 4,367,584 3.71
2016 16,943,615 3,054,080 1,239,488 4,293,568 3.95
Governmental Revenue Bonds
Fiscal Gross
Year Revenues Principal Interest Total Coverage
2007 29,200,152$ 788,670$ 642,711$ 1,431,381$ 20.40
2008 30,629,130 708,102 501,150 1,209,252 25.33
2009 28,084,482 733,900 486,372 1,220,272 23.01
2010 25,695,598 6,510,516 933,536 7,444,052 3.45
2011 23,921,715 234,970 253,984 488,954 48.92
2012 25,085,767 304,820 314,703 619,523 40.49
2013 28,135,868 321,910 371,951 693,861 40.55
2014 29,512,099 444,000 382,639 826,639 35.70
2015 31,739,256 479,440 367,991 847,431 37.45
2016 31,883,978 530,920 289,630 820,550 38.86
Certificates of Participation
Fiscal Gross
Year Revenues Principal Interest Total Coverage
2007 25,018,727$ 205,000$ 16,566$ 221,566$ 112.92
2008 29,200,152 0.00
2009 30,629,130 0.00
2010 28,084,482 0.00
2011 25,695,598 0.00
2012 23,921,715 0.00
2013 28,135,868 0.00
2014 29,512,099 0.00
2015 31,739,256 0.00
2016 31,883,978 0.00
Special Assessment
Fiscal Gross
Year Revenues Principal Interest Total Coverage
2007 379,840$ 185,000$ 186,828$ 371,828$ 1.02
2008 365,810 195,000 177,577 372,577 0.98
2009 367,539 205,000 248,429 453,429 0.81
2010 368,152 215,000 152,203 367,203 1.00
2011 365,811 225,000 147,548 372,548 0.98
2012 366,028 235,000 132,423 367,423 1.00
2013 365,935 250,000 117,576 367,576 1.00
2014 1,462,307 1,380,000 80,020 1,460,020 1.00
2015 178,078 130,000 45,917 175,917 1.01
2016 189,525 145,000 58,189 203,189 0.93
Source: Town of Oro Valley Finance Department
Debt Service
Debt Service
TOWN OF ORO VALLEY, ARIZONA
PLEDGED-REVENUE COVERAGE
LAST TEN FISCAL YEARS
(UNAUDITED)
Debt Service
Debt Service
Historical Historical Historical Historical Historical Historical HistoricalActualActual2007/082008/092009/102010/112011/122012/132013/142014/15 2015/16Revenues:Water revenues11,686,598$ 11,424,787$ 12,071,031$ 12,038,482$ 11,578,981$ 11,585,181$ 12,169,375$ 11,280,269$ 12,018,429$ Water connection fees1,925,656 1,588,084 293,607 244,376 462,762 706,159 1,413,047 591,045 544,852 Alternative water connection fees512,543 812,740 475,973 400,988 759,958 1,253,055 2,376,682 1,172,170 1,094,460 Groundwater preservation fees1,092,778 1,632,549 1,769,142 2,096,093 2,315,277 2,527,524 2,599,718 2,330,231 2,371,100 Other revenues1,586,375 639,926 527,031 541,299 557,222 660,681 727,972 714,965 710,740 Interest income864,262 125,458 70,329 38,445 166,654 - 110,615 124,593 203,857 Total revenues17,668,212 16,223,544 15,207,113 15,359,683 15,840,854 16,732,600 19,397,409 16,213,273 16,943,438 Expenses:Personnel2,324,921 2,447,642 2,514,595 2,418,118 2,497,865 2,537,150 2,659,895 2,767,143 2,952,249 Operations & maintenance5,836,698 5,415,423 4,505,751 3,721,167 3,559,807 4,564,894 4,303,230 4,530,436 5,059,998 CAP water costs602,682 185,490 154,575 903,855 636,519 1,093,105 1,499,594 1,570,793 1,952,117 Total expenses8,764,301 8,048,555 7,174,921 7,043,140 6,694,191 8,195,149 8,462,719 8,868,372 9,964,364 Net water system revenues8,903,911 8,174,989 8,032,192 8,316,544 9,146,662 8,537,452 10,934,690 7,344,901 6,979,074 Water supported debt service:2007 WIFA Loan308,406 369,627 316,983 316,875 316,763 311,494 311,377 311,256 2009 WIFA Loan161,554 182,268 186,817 150,471 149,367 149,322 2014 WIFA Loan296,972 361,059 2003 Revenue Bonds2,542,673 2,544,423 2,544,973 2,545,935 2,545,435 980,000 2003 Refunding Revenue Bonds648,512 648,674 647,374 1,152,546 1,238,996 1,243,058 2005 Excise Tax Bonds152,817 151,946 152,672 151,744 152,099 151,245 152,565 152,516 2007 Excise Tax Bonds735,007 1,136,077 1,516,494 791,099 791,203 791,111 790,822 1,255,948 1,197,678 2012 Refunding Bonds956,975 1,968,281 1,971,082 1,995,481 2013 Refunding Bonds1,513,427 1,046,558 1,022,420 2015 Refunding Revenue Obligations17,116 Total water supported debt service4,079,008$ 4,789,526$ 5,231,140$ 5,119,860$ 5,226,876$ 4,625,969$ 4,887,060 5,183,820 5,054,333 Debt service coverage2.181.711.541.621.751.852.241.421.38Source: Oro Valley Finance DepartmentTOWN OF ORO VALLEY, ARIZONAHISTORICAL AND PROJECTED WATER SYSTEM REVENUES, EXPENSES, DEBT SERVICE AND COVERAGE(UNAUDITED)JUNE 30, 2016
Personal Per
Income Capita
(thousands Personal Unemployment
Year Population of dollars)Income Rate
2007 42,551 1,678,195,258 39,440 2.6%
2008 43,651 1,773,226,205 40,623 3.0%
2009 43,694 1,828,222,176 41,841 5.1%
2010 43,521 1,875,613,105 43,097 6.2%
2011 41,011 1,820,460,164 44,390 6.0%
2012 41,335 1,661,839,665 40,204 6.4%
2013 43,070 1,692,780,210 39,303 6.4%
2014 41,887 1,679,965,408 40,107 6.2%
2015 42,259 1,728,773,431 40,909 5.2%
2016 43,565 1,817,844,597 41,727 5.3%
Source: US Census Bureau, Arizona Employment statistics and Pima Association of Governments
TOWN OF ORO VALLEY, ARIZONA
DEMOGRAPHIC AND ECONOMIC STATISTICS
LAST TEN FISCAL YEARS
(UNAUDITED)
2016 2015 2014 2013 2012 2011 2010 2009 2008 2007
Function/Program
Administration
Town Clerk 4.56 4.56 4.90 4.54 4.44 4.60 4.00 4.60 4.60 4.60
Town Manager 7.38 8.00 7.00 7.00 7.10 7.10 8.10 8.50 8.10 6.00
Human Resources 3.50 3.50 2.00 5.00 5.00 5.00 4.00 4.00 4.00 4.00
Economic Development 3.00 2.00 2.00 3.00 1.00 1.00 1.40 1.40 2.25 2.25
Finance 7.00 7.00 7.00 7.00 7.00 7.00 7.00 9.00 9.00 8.00
Information Systems 7.00 7.00 7.30 6.50 6.50 8.00 8.00 7.00 8.00 5.00
Legal 6.00 6.00 6.00 6.00 8.00 8.00 7.00 10.00 10.25 10.25
Community Development
Building Safety 0 0.00 0.00 0.00 0.00 0.00 13.00 16.00 18.00 17.00
Community Development Admin.0 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00
Planning & Zoning 0 0.00 0.00 0.00 0.00 0.00 13.00 16.00 16.00 14.00
Development & Infrastructure Services 83.76 81.45 78.84 77.22 73.38 73.10 0.00 0.00 0.00 0.00
Parks and Recreation 49.36 36.20 37.61 27.26 20.62 22.70 27.50 27.60 28.10 27.00
Cultural Resources 0.20 0.00 0.00 1.35 1.30 1.30 0.00 0.00 0.00 0.00
Library 0.00 0.00 0.00 0.00 18.55 18.40 18.50 18.70 19.40 19.30
Police
Civilians 30.25 30.25 25.93 30.25 30.25 29.70 30.70 33.00 34.00 34.00
Officers 102.88 102.88 101.91 101.44 97.96 95.00 97.90 102.40 108.00 105.00
Magistrate Court 8.00 8.00 8.70 8.00 8.00 9.00 9.00 9.00 8.50 8.50
Public Works 0.00 0.00 0.00 0.00 0.00 0.00 47.70 52.90 56.10 53.13
Water Utility 38.48 37.48 37.00 36.00 36.00 34.00 35.00 36.30 35.50 35.50
Total 351.37 334.32 326.19 320.56 325.10 323.90 331.80 356.40 369.80 353.53
Source: Town of Oro Valley Finance Department
TOWN OF ORO VALLEY, ARIZONA
FULL-TIME EQUIVALENT EMPLOYEES BY FUNCTION
LAST TEN FISCAL YEARS
(UNAUDITED)
Full-time Equivalent Employees as of June 30
FiscalIrrigationConstructionTurfYear Residential Commercial Irrigation Reclaimed Construction Reclaimed TurfReclaimedTotal20077,187,885$ 614,404$ 978,556$ 1,555 542,879$ 680,833$ 1,015,709 10,745,087$ 20087,511,067 667,910 1,146,222 796 652,446 1,630 666,558 1,039,969 11,021,820 20097,573,960 749,019 1,093,852 9,007 349,994 3,757 265,413 1,389,783 11,686,598 20108,040,762 902,432 1,152,529 14,240 222,447 720 354,308 1,383,592 11,434,785 20118,043,658 921,825 1,166,921 13,258 92,257 814 130,704 1,669,045 12,071,030 20127,761,639 954,472 1,050,602 13,466 120,830 653 115,568 1,561,750 11,578,980 20137,752,934 962,824 1,040,793 19,000 196,354 884 135,720 1,507,574 11,616,083 20147,881,436 886,712 1,169,067 187,622 283,632 816 121,108 1,638,981 12,169,374 20157,649,136 779,877 981,545 214,848 271,815 115,955 1,267,093 11,280,269 20168,103,644 778,915 1,129,741 50,479 310,609 114,427 1,530,107 12,017,922 Source: Town of Oro Valley Water Utility DepartmentWATER UTILITY REVENUES BY USER TYPELAST TEN FISCAL YEARS(UNAUDITED)TOWN OF ORO VALLEY, ARIZONA
2007200820092010201120122013201420152016Function/ProgramPoliceBurglaries 112 125 125 120 100 134 105 75 77 85Citations (traffic) 8,183 7,497 9,2566,736 5,244 5,084 5,456 4,668 4,486 3,890Investigations6,656 6,892 917 732 746 711 681 765 832 824Total Arrests2,236 2,254 2,478 2,176 1,932 1,716 1,5641,679 1,721 1,598Thefts575 577 528 567 656 571 563 561 500 586Development & Infrastructure ServicesStreet resurfacing (miles)7.7 10.553.4 14.8 13.9 22.4 30.5 73.4 101.0 92.0Parks and RecreationRecreation Programs Held Annually42 46 46 40 47 37 35 30 38 52Months of Public Pool Operations10 10 10 12 12 12 10 12 12 12Parks Maintenance Man-Hours Worked 15,60017,472 16,288 16,120 18,680 16,016 17,000 20,000 16,255 15,083LibraryCollection volume90,00096,000 95,750 100,142 100,652 97,3640000WaterNew connections367 346 196 68 61 97 213 165 202 176Total connections17,830 18,177 18,373 18,441 18,502 18,599 18,81218,977 19,179 19,355TransitTotal route miles165,202 175,841 163,964138,752 138,333 200,058 353,936 439,512 392,071 529,170Passengers14,858 16,908 17,101 15,573 14,873 20,119 32,442 39,196 39,102 45,202Source: Town of Oro Valley Finance DepartmentNote: Oro Valley Library was transferred to Pima County Library District on January 1, 2013.TOWN OF ORO VALLEY, ARIZONAOPERATING INDICATORS BY FUNCTIONLAST TEN FISCAL YEARS(UNAUDITED)
Base Rate Tier 1 Tier 2 Tier 3 Tier 4 GPF
Year monthly per 1,000 per 1,000 per 1,000 per 1,000 per 1,000
2007 13.25 2.08 2.81 3.76 N/A 0.25
2008 13.25 2.08 2.81 3.76 5.00 0.40
2009 13.91 2.18 2.95 3.95 5.25 0.55
2010 14.19 2.20 2.99 4.03 5.38 0.75
2011 14.19 2.20 2.99 4.03 5.38 0.75
2012 14.19 2.20 2.99 4.03 5.38 0.95
2013 14.19 2.20 2.99 4.03 5.38 0.95
2014 14.19 2.23 3.01 4.07 5.49 0.95
2015 14.19 2.27 3.10 4.23 5.76 0.90
2016 14.19 2.32 3.19 4.40 6.05 0.90
Source: Town of Oro Valley Water Utility
TOWN OF ORO VALLEY, ARIZONA
WATER RATES
LAST TEN FISCAL YEARS
(UNAUDITED)
2007200820092010201120122013201420152016Function/ProgramPoliceStations 1111111111Substations 2223333333Patrol units 105 113 109 108 53 67 66 64 74 77Other fleet 0000554243424544Development & Infrastructure ServicesStreets (miles) 201.9 220.1 220.1 214.0 203.8 203.8 205.1 221.0 221.0 221.0Streetlights93939393939395959595Traffic signals15 16 16 18 16 17 19 19 19 19Parks and recreationAcreage300 300 300 374 374 436 436 457 448 448Playgrounds2222222222Baseball/softball diamonds7777777777Community centers 0000000011Golf course holes 000000004545Tennis courts111111113232Swimming pools1111122244WaterWells22 19 22 18 22 22 22 18 20 20Storage capacity (MG)17.5 18 19 19 20 20 20 13 12 12Booster capacity28 27 27 26 25 25 25 26 27 27TransitTransit vans9999555974Transit mini buses 000051012171922Source: Town of Oro Valley Finance DepartmentTOWN OF ORO VALLEY, ARIZONACAPITAL ASSETS STATISTICS BY FUNCTIONLAST TEN FISCAL YEARS(UNAUDITED)