FY 2010-11 Budget (3)
VILLAGEOFTEQUESTACOUNCILMEMBERS2014
Fromlefttoright:CouncilMemberThomasPaterno,ViceMayorVinceArena,
MayorAbbyBrennan,CouncilMemberFrank$Ȍ!¬¡± ǾCouncilMemberSteveOkun
VILLAGE OF TEQUESTA, FLORIDA
COMPREHENSIVE ANNUAL FINANCIAL REPORT
FOR THE FISCAL YEAR ENDED SEPTEMBER 30, 2014
Prepared By
Finance Department
The Village of Tequesta, Florida
VILLAGE OF TEQUESTA, FLORIDA
TABLE OF CONTENTS
I. INTRODUCTORY SECTION
Letter of Transmittal .......................................................................................................................... i-iv
Certificate of Achievement for Excellence in Financial Reporting ...................................................... v
Organization Chart ............................................................................................................................... vi
List of Principal Officials ................................................................................................................... vii
II. FINANCIAL SECTION
INDEPENDENT AUDITORS’ REPORT ......................................................................................... 1-3
MANAGEMENT’S DISCUSSION AND ANALYSIS (Required Supplementary Information) ... 4-17
BASIC FINANCIAL STATEMENTS
Government-Wide Financial Statements
Statement of Net Position ............................................................................................................. 18
Statement of Activities ................................................................................................................. 19
Fund Financial Statements
Balance Sheet – Governmental Funds .......................................................................................... 20
Statement of Revenues, Expenditures and Changes in Fund Balances –
Governmental Funds ................................................................................................................. 21
Reconciliation of the Statement of Revenues, Expenditures and Changes in Fund
Balances of Governmental Funds to the Statement of Activities .............................................. 22
Statement of Net Position – Proprietary Funds ............................................................................ 23
Statement of Revenues, Expenses and Changes in Net Position – Proprietary Funds ................. 24
Statement of Cash Flows – Proprietary Funds ............................................................................. 25
Statement of Fiduciary Net Position – Fiduciary Funds .............................................................. 26
Statement of Changes in Fiduciary Net Position – Fiduciary Funds ............................................ 27
Notes to Basic Financial Statements .......................................................................................... 28-79
REQUIRED SUPPLEMENTARY INFORMATION
Budgetary Comparison Schedule – General Fund ........................................................................... 80
Note to the Budgetary Comparison Schedule .................................................................................. 81
Firefighters’ Pension Trust Fund
Schedule of Changes in the Village’s Net Pension Liability and Related Ratios ......................... 82
Schedule of Village Contributions ............................................................................................... 83
Schedule of Investment Returns ................................................................................................... 84
Schedule of Funding Progress ...................................................................................................... 85
Police Officers’ Pension Trust Fund
Schedule of Changes in the Village’s Net Pension Liability and Related Ratios ......................... 86
Schedule of Village Contributions ............................................................................................... 87
Schedule of Investment Returns ................................................................................................... 88
Schedule of Funding Progress ...................................................................................................... 89
General Employees’ Pension Trust Fund
Schedule of Changes in the Village’s Net Pension Liability and Related Ratios ......................... 90
Schedule of Village Contributions ............................................................................................... 91
Schedule of Investment Returns ................................................................................................... 92
Schedule of Funding Progress ...................................................................................................... 93
Schedule of Funding Progress - Other Post Employment Benefits ................................................. 94
VILLAGE OF TEQUESTA, FLORIDA
TABLE OF CONTENTS
II. FINANCIAL SECTION (CONTINUED)
SUPPLEMENTARY INFORMATION
Combining and Individual Fund Statements and Schedules
Combining Balance Sheet – Nonmajor Governmental Funds ..................................................... 95
Combining Statement of Revenues, Expenditures and Changes in Fund Balances –
Nonmajor Governmental Funds ................................................................................................ 96
Budgetary Comparison Schedule – Special Law Enforcement Trust Fund ................................. 97
Budgetary Comparison Schedule – Capital Improvement Fund .................................................. 98
Budgetary Comparison Schedule – Capital Projects Fund ........................................................... 99
Combining Statement of Fiduciary Net Position ....................................................................... 100
Combining Statement of Changes in Fiduciary Net Position ..................................................... 101
III. STATISTICAL SECTION
Net Position by Component .............................................................................................................. 102
Changes in Net Position ............................................................................................................. 103-104
Fund Balances, Governmental Funds ............................................................................................... 105
Changes in Fund Balances, Governmental Funds ............................................................................ 106
Assessed and Estimated Actual Value of Taxable Property ............................................................. 107
Property Tax Rates – All Direct and Overlapping Governments ..................................................... 108
Principal Property Taxpayers ............................................................................................................ 109
Property Tax Levies and Collections ................................................................................................ 110
Ratios of Outstanding Debt by Type ................................................................................................ 111
Ratio of Net Outstanding Debt to Assessed Value and Net Bonded Debt
Per Capita ....................................................................................................................................... 112
Computation of Legal Debt Margin .................................................................................................. 113
Direct and Overlapping Governmental Activities Debt .................................................................... 114
Pledged-Revenue Coverage – Revenue Bonds - 1994 ..................................................................... 115
Demographic and Economic Statistics ............................................................................................. 116
Principal Employers – Palm Beach County ...................................................................................... 117
Full-time-Equivalent Village Government Employees by Function/Program.................................. 118
Operating Indicators by Function/Program ...................................................................................... 119
Capital Asset Statistics by Function/Program ................................................................................... 120
IV. REPORTING SECTION
Independent Auditors’ Report on Compliance and on Internal Control over Financial
Reporting and on Compliance and Other Matters based on an Audit of Financial
Statements Performed in Accordance with Government Auditing Standards ........................ 121-122
Management Letter in Accordance with the Rules of the Auditor General of the
State of Florida ....................................................................................................................... 123-124
Independent Accountants’ Report On Compliance Pursuant To Section 218.415
Florida Statutes .............................................................................................................................. 125
INTRODUCTORY SECTION
Village of Tequesta
345 Tequesta Drive
Tequesta, Florida 33469-0273
(561) 768-0424
www.Tequesta.org
May 1, 2015
To the Honorable Mayor,
Members of the Village Council
And Citizens of the Village of Tequesta, Florida
Florida law requires that every general purpose local government publish, within nine months of the close
of each fiscal year, a complete set of audited financial statements. This report is published to fulfill that
requirement for the fiscal year ended September 30, 2014.
Management assumes full responsibility for the completeness and reliability of the information contained
in this report, based upon a comprehensive framework of internal control that it has established for this
purpose. Because the cost of internal control should not exceed anticipated benefits, the objective is to
provide reasonable, rather than absolute, assurance that the financial statements are free of any material
misstatements.
Marcum LLP, Certified Public Accountants, have issued an unmodified (“clean”) opinion on the Village
of Tequesta’s financial statements for the fiscal year ended September 30, 2014. The independent
auditors’ report is located at the front of the financial section of this report.
Management’s discussion and analysis (MD&A) immediately follows the independent auditors’ report
and provides a narrative introduction, overview, and analysis of the basic financial statements. MD&A
complements this letter of transmittal and should be read in conjunction with it.
PROFILE OF THE VILLAGE OF TEQUESTA
The Village of Tequesta, Florida is a municipal corporation organized June 4, 1957 pursuant to Special
Act 57-1915, Laws of Florida. It is approximately 2 square miles and is located in northern Palm Beach
County, Florida. It is almost completely built-out/developed.
Tequesta’s growth potential is restricted by the natural boundaries of the Atlantic Ocean to the east, the
Loxahatchee River to the west, the Town of Jupiter to the south and Martin County to the north. It is
empowered by state stature to extend its corporate limits by annexation, which it has done from time to
time.
The Village has a Council-Manager form of government. Policy-making and legislative authority are
vested in an elected governing body of the Village consisting of a five member Village Council. Council
members are elected at large and select a Mayor at their first organizational meeting each year. Council
members serve two-year terms, with three members elected every other year. The Village Council
appoints the Village of Tequesta’s manager, who is responsible for hiring all Village employees.
i
The Village of Tequesta provides a full range of services, including police and fire protection; building
inspections; licenses and permits; the construction and maintenance of streets and other infrastructure,
recreational and cultural activities, water services, stormwater operations and contracts for residential
refuse and recycling services.
The Council is required to adopt an initial budget prior to beginning of the fiscal year on October 1. This
annual budget serves as the foundation for the Village of Tequesta’s financial planning and control. The
budget is prepared by fund, function (e.g., public safety), and department (e.g., police) and is adopted by
fund total. Departments may transfer resources within a department with the approval of the budget
officer and the Village Manager. Transfers between departments require the budget amendments be
approved by the Village Council, while changes to the total fund budget requires approval of the Village
Council by resolution.
Local Economy
The Village of Tequesta, located in Palm Beach County, Florida, is home to middle to upper-income
suburban families. Tequesta has a small commercial area and no major industries located within its
boundaries. The Village of Tequesta is home to a number of assisted living facilities, private schools and
a high-end treatment center.
Over the past year, 37 states, including Florida had statistically significant changes in employment, all of
which were positive. The largest significant over-the-year job increase occurred in Texas (413,700)
followed by California (297,000) and Florida (205,600). The national unemployment rate for September
was 5.9%, the first time unemployment has dropped below six percent since July 2008. The
unemployment rate in Florida for September 2014 was 6.1% which was 0.8% lower than the prior year.
The unemployment rate for Palm Beach County at the fiscal year end was 6.0%, down from 6.7% the
previous year. It has been suggested that a stronger job market may also force the Federal Reserve to back
away from six years of bond-buying that pumped more than a trillion dollars into the economy.
However, because inflation is below the Fed’s 2% target they might well keep interest rates near zero in
the immediate future.
According to the US Census Bureau’s Quickfacts as of July 8, 2014, median household income for
Tequesta was $64,191 which continues to be significantly higher than the nation as a whole
($47,309).Tequesta is beginning to see a positive change in the housing market as property values
continue to increase. Per the Palm Beach County Property Appraiser’s Office, gross taxable value for
calculating ad valorem proceeds increased from $780 million during fiscal year 2013 to $817 million used
to calculate 2014 revenues – approximately 4.7% higher than the prior year. The Village of Tequesta
continues to develop its operating budget based on this expected slow, but steady, increase in property
values over the next few years.
During the past ten years, the Village’s expenditures related to public safety have increased in amount and
as a percentage of total expenditures in governmental funds (currently $6.2 million or 50% of total
general funds expenditures, an increase of $2.06 million from 2004). Much of this increase reflects a
trend that has seen the salaries and benefits of police and firefighters growing at a much faster rate than
those of other categories of public sector employees.
During this same ten-year period, charges for services related to public safety have also increased in
amount and as a percentage of total revenues reflecting a ten-year increase of $604 thousand from 2004.
In the most recent three-year period (2011 through 2013) this revenue source has followed a downward
trend with revenues decreasing $141,135 during that three-year period. However, the Village of Tequesta
renegotiated a contract for fire rescue service that begins in fiscal year 2014 and we expect to see this
revenue source increase by $177 thousand.
ii
Long-Term Financial Planning and Major Initiatives
Unrestricted fund balance in the general fund at year end was 21.8% of total general fund revenues. This
amount was above policy guidelines set by the Council for budgetary and planning purposes (i.e., two
months of general fund revenues, approximately 16.7%). The Village of Tequesta has always spent
conservatively while providing the highest quality services to its residents. We continue to cautiously
watch the “gap” between revenues and expenditures. To protect the investments our residents have made
in their community, the Village increased the millage rate to 6.0500 from 5.7671 which was an 8.69%
percent change of the rolled-back rate (the rate required to bring in the same amount of revenue as the
prior period). It has not been easyto maintain a consistently high quality of services to the residents,
while protecting the assets, the level of service and the quality of life that the residents of the Village of
Tequesta have come to expect. It is the result of hard work, long hours, pay and benefit concessions and
the making of fiscally sound, responsible decisions by the administration, working staff and Village
Council that allowed the Village to meet service demands while minimizing the financial burden on its
residents. The Village is very fortunate to have a citizenry that is active on many boards and committees,
a working staff that has shown its willingness to take on additional responsibilities, an expanded
workload and very importantly, a Village Council that is very responsive to the needs of the residents and
staff and who donate so much of their time to this community. If the future of a community is dependent
on its people, then the future of Tequesta is bright and we expect to successfully meet challenges that
come before us.
The Village of Tequesta’s primary focus is providing exceptional municipal services to its residents in the
most efficient and cost effected manner possible. Continued economic challenges require innovative
approaches on both sides of the balance sheet. Efforts to expand contractual services to generate
additional revenue should continue to be considered.
The Village should continue to modify its traditional public safety plans, if an effort to reduce costs and
future liabilities.
The Village continues researching ways to control the growing cost of health care and post-retirement
benefits and has implemented changes and negotiated concessions with the current bargaining units.
Tequesta continues to discuss options with the three collective bargaining units to control the cost of post-
retirement benefits.
MAJOR INITIATIVES
Continue to explore alternative revenue sources, at both the state and federal level, with the
assistance of a professional lobbyist.
Continue to find ways to reduce the cost of health care and post-retirement benefits.
Finalize negotiations of a new contract with the IAFF (International Association of
Firefighters).
Develop a 6-year capital improvement /capital replacement plan.
Provide a utility revenue sufficiency and rate adequacy study to evaluate the overall
sufficiency of the rate revenues to meet the Village’s objectives for a sustained high quality
utility service by providing a stable funding plan.
Relevant Financial Policies
The Village of Tequesta has adopted a comprehensive set of financial policies. During the next fiscal
year, the Village will be reviewing and updating its Water Utility policies.
iii
AWARDS AND ACKNOWLEDGEMENTS
The Government Finance Officers Association (GFOA) awarded a Certificate of Achievement for
Excellence in Financial Reporting to Tequesta for its comprehensive annual financial report for the fiscal
year ended September 30, 2013. This was the thirtieth consecutive year that Tequesta has received this
prestigious award. In order to be awarded a Certificate of Achievement, Tequesta had to publish an easily
readable and efficiently organized comprehensive annual financial report. This report satisfied both
generally accepted accounting principles and applicable legal requirements.
A Certificate of Achievement is valid for a period of one year. We believe that our current comprehensive
annual financial report will continue to meet the Certificate of Achievement Program’s requirements and
we are submitting it to the GFOA to determine its eligibility for another certificate.
The preparation of this report would not have been possible without the efficient and dedicated services of
the entire staff of the Tequesta’s finance department. We would like to express our appreciation to all
members of the department who assisted and contributed to the preparation of this report.
In closing, we must also acknowledge the Mayor and Council for their unfailing support for maintaining
the highest standards of professionalism in the management of the Village of Tequesta’s finances.
iv
v
VILLAGE OF TEQUESTA, FLORIDA
ORGANIZATION CHART
SEPTEMBER 30, 2014
vi
VILLAGE OF TEQUESTA, FLORIDA
LIST OF PRINCIPAL OFFICIALS
SEPTEMBER 30, 2014
VILLAGE COUNCIL
Abby Brennan Mayor
Vince Arena Vice-Mayor
Frank D’Ambra Councilmember
Steve Okun Councilmember
Thomas Paterno Councilmember
VILLAGE OFFICIALS
Michael R. Couzzo, Jr. Village Manager
Corbett, White and Davis, PA Village Attorney
Lori McWilliams, MMC Village Clerk
JoAnn Forsythe, CPA Finance Director
James M. Weinand Fire Chief
Christopher L. Elg Police Chief
NZ Consultants, Inc. Planning and Zoning Director
Timothy English Director/Building Official
Michael R. Couzzo, Jr. Utilities Director
Greg Corbitt Parks and Recreation Director
Merlene Reid, MS, SPHR Human Resources Director
VILLAGE INDEPENDENT AUDITORS
Marcum LLP
vii
FINANCIAL SECTION
INDEPENDENT AUDITORS’ REPORT
INDEPENDENT AUDITORS' REPORT
To The Honorable Mayor, Village Council and Village Manager
Village of Tequesta, Florida
Report on the Financial Statements
We have audited the accompanying financial statements of the governmental activities, the
business-type activities, each major fund, and the aggregate remaining fund information of the
Village of Tequesta, Florida (the Village) as of and for the fiscal year ended September 30, 2014
and the related notes to the financial statements, which collectively comprise the Village’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.
Auditors’ 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 auditors’
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.
1
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, the business-type activities, each major
fund, and the aggregate remaining fund information of the Village of Tequesta, Florida as of
September 30, 2014 and the respective changes in financial position and, where applicable, cash
flows thereof for the fiscal year then ended in accordance with accounting principles generally
accepted in the United States of America.
Emphasis of a Matter
As discussed in Note 1 to the financial statements, the Village implemented Governmental
Accounting Standards Board (GASB) Statement No. 67, Financial Reporting for Pension Plans,
an amendment of GASB Statement No.25. 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 and budgetary comparison information, schedules of net
pension liability and ratios, contributions, investment returns and funding progress on pages 4-17
and 80-94 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 Village’s basic financial statements. The combining and individual fund
statements and schedules, the introductory and statistical sections are presented for purposes of
additional analysis and are not a required part of the basic financial statements.
2
The combining and individual fund 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 statements and schedules are fairly stated, in all material respects,
in relation to the basic financial statements as a whole.
The introductory and statistical sections have not been subjected to the auditing procedures
applied in the audit of the basic financial statements, and accordingly, we do not express an
opinion or provide any assurance on it.
Other Reporting Required byGovernment Auditing Standards
In accordance with Government Auditing Standards, we have also issued our report dated May 1,
2015 on our consideration of the Village’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 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 Village’s internal control over financial reporting and compliance.
West Palm Beach, Florida
May 1, 2015
3
MANAGEMENT’S DISCUSSION AND ANALYSIS
(MD&A)
Village of Tequesta, Florida
Management’s Discussion and Analysis
As management of the Village of Tequesta, we offer readers of the Village’s financial statement this
narrative overview and analysis of the financial activities of the Village for the fiscal year ended
September 30, 2014. We encourage readers to consider the information presented here in conjunction
with the additional information that we have furnished in the letter of transmittal found on pages i to iv of
this report.
Financial Highlights
The assets and deferred outflows of resources of the Village of Tequesta exceeded its liabilities
and deferred inflows of resources at the close of the most recent fiscal year by $33,000,343 (net
position). Of this amount, $8,353,378 is unrestricted and may be used to meet the ongoing
obligations to the citizens and creditors.
The Village of Tequesta’s total net position decreased $428 thousand during the current period
Governmental activities increased net position by $113 thousand and business activities
decreased net position by $540 thousand.
At the close of the current fiscal year, the Village of Tequesta’s governmental funds reported
combined fund balances of $3,904,907, an increase of $99,985 from the prior year.
Of the $3.9 million in fund balance, approximately 44% of this amount ($1.7 million) is available
for spending at the government’s discretion (unassigned fund balance).
At the end of the current fiscal year, unrestricted fund balance (the total of the committed,
assigned,andunassigned components of fund balance) for the general fund in 2014 was
$2,727,608 or approximately 27% of total general fund expenditures, down from 33% in 2013.
The Village of Tequesta’s total outstanding long-term debt increased by $124 thousand or
approximately 3.6%, due mainly to the net effect of paying down existing note payable and
entering into a capital lease for the purchase of a fire pumper. Please see details in the Notes to
Basic Financial Statements, Note 3. K. starting on page 75.
The Village did not expend $500,000 or more in Federal and/or State financial assistance in the
fiscal year ended September 30, 2014 and therefore did not meet the threshold for a single audit
according to the Florida Single Audit Act (section 215.97 F.S.) and OMB Circular A-133.
Overview of the Financial Statements
This discussion and analysis is intended to serve as an introduction to the Village of Tequesta’s basic
financial statements. The Village’s basic financial statements consist of three components: 1)
government-wide financial statements, 2) fund financial statements, and 3) notes to the financial
statements. This report also includes supplementary information intended to furnish additional detail to
support the basic financial statements themselves.
4
Government-wide Financial Statements: The government-wide financial statements are designed to
provide readers with a broad overview of the Village of Tequesta’s finances, in a manner similar to a
private-sector business.
Thestatement of net position presents financial information on all of the Village of Tequesta’s assets,
liabilities, and deferred inflows/outflows of resources, with the difference 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 Village of Tequesta is improving or deteriorating.
Thestatement of activities presents information showing how the Village of Tequesta’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 result in cash flows in future
fiscal periods (e.g., uncollected taxes and earned but unused vacation leave).
Both of the government-wide financial statements distinguish functions of the Village of Tequesta that are
principally supported by taxes and intergovernmental revenues (governmental activities) from other
functions that are intended to recover all or a significant portion of their costs through user fees and
charges (business-type activities). The governmental activities of the Village included general
government, public safety, transportation and leisure services. The business-type activities of the Village
included water, stormwater and refuse and recycling.
The government-wide financial statements can be found on pages 18-19 of this report.
Fund Financial Statements.
Afundis a grouping of related accounts that is used to maintain control
over resources that have been segregated for specific activities or objectives. The Village of Tequesta,
like other state and local governments, uses fund accounting to ensure and demonstrate compliance with
finance-related legal requirements. All of the funds of the Village of Tequesta can be divided into three
categories: governmental funds, proprietary funds, and fiduciary 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 and outflows 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 assessing a government’s near-term
financing requirements.
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 governmentalactivities in the government-wide financial statements. By doing
so, readers may better understand the long-term impact of the government’s near-term financing
decisions. 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 andgovernmental activities.
The Village of Tequesta maintains four individual governmental funds. Information is presented
separately in the governmental fund balance sheet and in the governmental fund statement of revenues,
expenditures, and changes in fund balance for the General Fund which is considered a major fund. Data
from the other three governmental funds is 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 in the combining and individual fund statements and schedules section of this report.
5
The Village of Tequesta adopts an annual appropriated budget for its governmental funds. A budgetary
comparison statement has been provided for the general fund to demonstrate compliance with this budget.
The Village of Tequesta’s governmental fund financial statements can be found on pages 20-21 of this
report.
Proprietary Funds.
The Village of Tequesta maintains one type of proprietary fund – enterprise funds.
Enterprise funds are used to report the same functions presented as business-typeactivities in the
government-wide financial statements. The Village of Tequesta uses enterprise funds to account for its
water, stormwater, and refuse and recycling funds.
Proprietary funds provide the same type of information as the government-wide financial statements, only
in more detail. The proprietary fund financial statements provide separate information for the Water fund
and the Stormwater Fund, major funds, as well as the Refuse and Recycling fund, a nonmajor fund.
The basic proprietary fund financial statements can be found on pages 23-25 of this report.
Fiduciary Funds.
Fiduciary funds are used to account for resources held for the benefit of parties outside
the Village. Fiduciary funds arenot reported in the government-wide financial statement because the
resources of those funds arenot available to support the Village’s own programs. The accounting used
for fiduciary funds is much like that used for proprietary funds. GASB Statement No. 67 was
implemented in fiscal year 2014.
The Village of Tequesta maintains one type of fiduciary fund – a Pension trust fund which is used to
report resources held in trust for retirees and beneficiaries covered by the Public Safety Pension Plan
(which includes the Firefighters’ Pension Trust Fund and the Police Officers’ Pension Trust Fund) and the
General Employees’ Pension Plan.
The fiduciary fund financial statements can be found on pages 26-27 of this report.
Notes to basic financial statements:
The notes provide additional information that is necessary to
acquire a full understanding of the data provided in the government-wide and fund financial statements.
The notes to the basic financial statements can be found on pages 28-79 of this report.
Other information:
In addition to the basic financial statements and accompanying notes, this report also
presents certain required supplementary information concerning the Village of Tequesta’s progress in
funding its obligation to provide pension benefits and OPEB benefits to its employees, as well as the
Village’s net pension liability, contributions and pension investment returns. Required supplementary
information can be found on pages 80-94 of this report.
The combining statements referred to earlier in connection with non-major governmental funds and
fiduciary funds are presented immediately following the required supplementary information on pensions
and OPEB. Combining and individual fund statements and schedules can be found on pages 95-101 of
this report.
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Government-wide Overall Financial Analysis
As noted earlier, net position over time, may serve as a useful indicator of a government’s financial
position. In the case of the Village of Tequesta, assets and deferred outflows of resources exceeded
liabilities and deferred inflows by $13,965,314 at the close of the most recent fiscal year.
Village of Tequesta’s Net Position
As seen below, the Village of Tequesta’s total assets and deferred outflows exceeded total liabilities and
deferred inflows by approximately $33 million at the close of the 2014 fiscal year. Governmental
activities recorded a change of 0.81% in total net position while the Village’s business-type activities
recorded a (2.76 %) change in total net position.
Village of Tequesta's Net Position
GovernmentalBusiness-type
ActivitiesActivitiesTotal
2014 2013 2014 2013 2014 2013
Current and other assets $ 4,910,701 $ 4,878,984 $ 6,086,581 $ 5,728,854 $10,997,282 $10,607,839
Capital assets, net 13,189,543 13,039,737 18,345,747 19,395,803 31,535,290 32,435,540
Total assets 18,100,244 17,918,721 24,432,328 25,124,657 42,532,572 43,043,378
Total deferred outflows of
resources - - 302,367 324,834 302,367 324,834
Long-term liabilities
outstanding 3,578,906 3,455,442 5,429,500 5,711,390 9,008,406 9,166,832
Other liabilities 421,431 447,629278,752162,436700,183610,065
Total liabilities 4,000,337 3,903,071 5,708,252 5,873,826 9,708,589 10,439,146
Total deferred inflows of
resources 134,593 163,117 - - 134,593 163,117
Net position
Net investment in
capital assets 10,284,849 10,261,476 13,402,412 14,167,067 23,687,261 24,428,543
Restricted 959,704 579,320 - - 959,704 579,320
Unrestricted 2,720,761 3,011,737 5,632,617 5,408,598 8,353,378 8,420,335
Total net position $13,965,314 $13,852,533 $19,035,029 $19,575,665 $33,000,343 $33,428,198
The largest portion of the Village’s total net position (72%) represents investments in capital assets (e.g.,
land, buildings, machinery and equipment), less any related outstanding debt and deferred
inflows/outflows used to acquire those assets. The Village uses these capital assets to provide services to
citizens; consequently, they are not available for future spending. Although the Village’s investment in
its capital assets is reported net of related debt, it should be noted that the resources needed to repay this
debt must be provided from other sources, since the capital assets themselves cannot be used to liquidate
these liabilities.
An additional portion of the Village of Tequesta’s net position (2.9%) represents resources that are
subject to external restrictions on how they may be used. The remaining balance of $8,353,378 is
unrestricted and may be used to meet the government’s ongoing obligations to its citizens and creditors.
7
At the end of the current fiscal year, the Village of Tequesta is able to report positive balances in all
categories of net position, both for the government as a whole, as well as for its separate governmental
and business-type activities. The same situation held true for the prior fiscal year.
VillageofTequesta,NetPosition
Restricted
Unrestricted
NetInvestmentsincapitalassets
NetInvestmentsincapital
9/30
UnrestrictedRestricted
assets
2013
24,428,5438,420,335579,320
2014
23,687,2618,353,378959,704
The Village of Tequesta’s overall net position decreased $427,855 from the prior fiscal year. The reasons
for this overall decrease are discussed in the following sections for governmental activities and business-
type activities.
Village of Tequesta’s Changes in Net Position
Village of Tequesta
Changes in Net Position
Governmental Business-type Activities
Total
ActivitiesActivities
201420132014201320142013
Revenues:
Program Revenues:
Charges for Services $ 2,526,790 $ 1,929,223 $ 4,960,023 $4,824,690 $7,486,813 $6,753,913
Operating Grants & Contributions 63,148 95,145 - - 63,148 95,145
General Revenues:
Ad valorem Taxes 4,767,948 4,339,215 - - 4,767,948 4,339,215
Other Taxes 1,216,100 1,266,929 - - 1,216,100 1,266,929
Franchise fees on gross receipts 401,859 380,160 - - 401,859 380,160
Unrestricted intergovernmental 770,616 735,924 - - 770,616 735,924
Unrestricted investment earnings 13,184 22,316 14,976 20,727 28,160 43,043
Other Miscellaneous 53,406 77,390 35,415 37,017 88,821 114,407
Total Revenue 9,813,051 8,846,302 5,010,414 4,882,434 14,823,465 13,728,736
8
Village of Tequesta
Changes in Net Position (Continued)
GovernmentalBusiness-type Activities
Total
ActivitiesActivities
201420132014201320142013
Expenses:
General government 1,770,326 1,642,948 - - 1,770,326 1,642,948
Public safety 6,222,408 6,207,866 - - 6,222,408 6,207,866
Transportation 1,009,693 1,049,062 - - 1,009,693 1,049,062
Leisure Services 583,445 640,513 - - 583,445 640,513
Interest on long-term debt 114,398 135,204 - - 114,398 135,204
Water utility services - - 4,782,022 4,204,955 4,782,022 4,204,955
Stormwater services - - 279,051 221,283 279,051 221,283
Refuse & recycling services - - 489,977 484,165 489,977 484,165
Total Expenses 9,700,270 9,675,593 5,551,050 4,910,403 15,251,320 14,585,996
Increase (decrease) in net position 112,781 (829,291) (540,636) (27,969) (427,855) (857,260)
Net position - beginning 10/01 13,852,533 14,681,824 19,575,665 19,603,634 33,428,198 34,285,458
Net position - ending 9/30 $13,965,314 $13,852,533 $19,035,029 $19,575,665 $33,000,343 $33,428,198
Governmental Activities – Expenses and Program Revenues
Governmental activities.
During the current fiscal year, net position for governmental activities increased
$113 thousand (less than 1%) from the prior period and ended with a balance of $13,965,314. This change
resulted from an increase in the millage rate from 5.7671 to 6.050 which generated additional revenue of
$429 thousand, which was offset by a decrease in revenue from other taxes of $51 thousand. Additionally,
revenues received for charges for services increased $598 thousand with the largest increases recorded in
Emergency Services (a new contract for emergency services with Jupiter Inlet Colony increased revenue
$200 thousand) and building permit fees which increased $100 thousand. There was a small increase in
total expenses from the prior year ($25 thousand) and overall the Village’s net position from governmental
activities remained stable.
ExpensesandProgramRevenuesGovernmentalActivities
inThousands
$8,000
$6,000
$4,000
$2,000
$
RevenuesExpenses
9
The Village’s programs/functions include General Government, Public Safety, Transportation and Leisure
Services. The net cost shows the extent to which the Village’s general revenues support each of the
Village’s programs. The net cost of all governmental activities this year was $7.1 million – a decrease of
6.6% from the prior period. This was the result of an increase in charges for services while expenses
remained stable. As shown on the Statement of Activities, the functions directly benefiting from the
programs generated revenue of approximately $2 million towards this cost and the remainder was
financed through general revenues ($7.2 million) and the use of excess funds.
The following is a comparison of revenues by source for governmental activities for fiscal year 2014 and
2013.
RevenuesbySourceGovernmentalActivities
inThousands
2014
5000
2013
4500
4000
3500
3000
2500
2000
1500
1000
500
0
Business-type Activities.
The Village of Tequesta’s business-type activities resulted in a decrease of
$541 thousand in net position. Revenues were up $135 thousand from the prior year attributable to higher
demand for water. This was offset by an increase in expenses in the water utility of $577 thousand.
Expenses related to renewal and replacement projects ($448 thousand) significantly contributed to the
water utility expenses increasing 13.7% from the prior year. Renewal and replacement projects are a
planned investment in the system to ensure the facilities function at their designed level. The project was
budgeted at $788 thousand and is ongoing at year end.
10
TotalRevenues/ExpensesBusinessTypeActivities
inThousands
$5,000
$4,500
$4,000
$3,500
$3,000
$2,500
$2,000
$1,500
$1,000
$500
$
WaterUtilityRefuse&RecyclingStormwaterUtility
RevenueExpenses
As the chart below demonstrates, revenues received from charges for services were fairly stable and
increasing slightly from the prior year. Non-operating income reflects revenues from cash and investment
earnings, which remains low, as excess cash is invested in low-risk, highly liquid instruments.
RevenuesbySourceBusinessTypeActivities
RevenuesbySourceBusinessTypeActivities
$5,000,000
$4,500,000
$4,000,000
$3,500,000
2013
$3,000,000
2014
$2,500,000
$2,000,000
$1,500,000
$1,000,000
2014
$500,000
20132013
$
ChargesforServices
Nonoperating
11
Financial Analysis of the Village’s Funds
As noted earlier, the Village of Tequesta uses fund accounting to ensure and demonstrate compliance with
finance-related legal requirements.
Governmental funds:
The focus of the Village’s governmental funds is to provide information on near-
term inflows, outflows, and balances of spendable resources. Such information is useful in assessing the
Village’s financing requirements. In particular, unassigned fund balance may serve as a useful measure
of a government’s net resources available for discretionary use as they represent the portion of fund
balance which has not yet been limited to use for a particular purpose by either an external party, the
Village of Tequesta itself, or a group or individual that has been delegated authority to assign resources
for use for particular purposes by the Village of Tequesta’s Council.
At September 30, 2014 the Village of Tequesta’s governmental funds reported total combined fund
balances of $3,904,907. Approximately 44% ($1.7 million) of combined governmental fund balances of
$3.9 million is unassigned fund balance and is available for spending at the Village’s discretion.
Approximately 26% is assigned fund balance which includes $1 million for hurricane/disaster
emergency. The remaining $1.2 million is either restricted for a particular purpose (i.e. debt service, etc.)
or not in spendable form (i.e. inventories, prepaid items, etc.). During the year, restricted and
nonspendable fund balances increased $444 thousand with the largest increases from $269 thousand from
receipt of forfeiture funds and $133 thousand from surpluses generated from building permit fees.
However, unassigned and assigned fund balances decreased $344 thousand. The net effect was an
increase in total combined fund balances of $100 thousand.
Governmental Funds
Components of Fund Balance
September 30, 2014 and 2013
2013
Nonspendable.
Restricted
Assigned
Unassigned
2014
$0$500,000$1,000,000$1,500,000$2,000,000
12
The General Fund is the chief operating fund of the Village of Tequesta. At the end of the current fiscal
year, unassigned fund balance of the General Fund was $1,714,008 while total fund balance was
$3,603,527. As a measure of the General Fund’s liquidity, it may be useful to compare both unassigned
fund balance and total fund balance to total fund expenditures. Unassigned fund balance represents
approximately 17% of fiscal year 2014 General Fund expenditures (a decrease of 4%) and total fund
balance represents 36%. The ratio of total fund balance to expenditures has decreased from the prior year
when total fund balance represented 47% of total expenditures. This is the sixth year that these ratios have
decreased representing a growing gap between revenues and expenditures as the Village uses excess
funds to bridge this gap. The fund balance of the Village of Tequesta’s general fund decreased by $37,636
during the current fiscal year which was significantly less than in prior years, as the Village continues to
reduce it use of existing funds to support activities.
General Fund
Components of Fund Balance
September 30, 2014 and 2013
2013
Nonspendable.
Restricted
Assigned
Unassigned
2014
$0$500,000$1,000,000$1,500,000$2,000,000
13
The amount of General Fund revenue by type, their percent of the total and the amount of change
compared to last fiscal year are shown in the following schedule:
General Fund Revenues –by Source
GENERAL FUND
REVENUES
Change
Revenue Sources 2014 % of Total $%2013
Taxes
$4,767,948 50.1% $428,733 9.88% $4,339,215
Other taxes
1,216,100 12.8% (50,829) -4.01% 1,266,929
Intergovernmental
816,323 8.6% 63,595 8.45% 752,728
Franchise fees
401,859 4.2% 21,699 5.71% 380,160
Charges for services
1,102,496 11.6% 200,837 22.27% 901,659
Intragovernmental
519,188 5.5% 15,479 3.07% 503,709
Licenses and permits
433,428 4.6% 102,859 31.12% 330,569
Investment earnings
13,184 0.1% (9,132) -40.92% 22,316
Fines and forfeitures
31,977 0.3% 14,048 78.35% 17,929
Miscellaneous
86,021 0.9% (73,505) -46.08% 159,526
Rents and Royalties
136,906 1.4% (10,397) -7.06% 147,303
Total Revenue
$9,525,430 100%$703,387 7.97% $8,822,043
Total General Fund revenue has increased $703.387 (8%) due to an increase in the tax rate as well as
improved property values. Additionally, the Village negotiated better rates for emergency services to
other cities and fees from permits were higher than expected for the year. The increase in revenue from
licenses and permits is indicative of the cyclical nature of this revenue in a community that is almost
completely built out.
Expenditures in the General Fund are shown in the following schedule:
GENERAL FUND
EXPENDITURES BY FUNCTION
Change
Function 2014 % of Total $%2013
Public Safety
$ 5,900,978 58.2% $ (501) 0.0% $5,901,479
General government
1,614,291 15.9% 85,977 5.6% 1,528,314
Transportation
858,787 8.5% 57,828 7.2% 800,959
Leisure services
507,069 5.0% (54,869) -9.8% 561,938
Debt service
433,545 4.3% 48,812 12.7% 384,733
Capital outlay
831,240 8.2% 710,841 590.4% 120,399
Total expenditures
$10,145,910 100%$848,088 9.1% $9,297,822
14
General fund expenditures show an increase (9.1%) due mainly to the purchase of capital items which are
recorded as expenditures in the funds as they report on a modified accrual basis of accounting.
Additionally, the Village entered into a capital lease for the purchase of a fire pumper which resulted in
the cost of debt increasing 3.6%. The remaining increase in expenditures 1.48% ($137 thousand)
represents the effect of cost of living increases (wages and changes in the cost of operational
expenditures). Below is a graphic presentation of how (what functions) the Village expends funds.
General Fund -Expenditures by Source
in Thousands
$6,000
$5,000
$4,000
$3,000
$2,000
$1,000
$0
2014
2013
Ending fund balances for the Capital Projects Fund is $4,313 and the Capital Improvement fund is
$5,412. Fund balances in both funds are assigned for capital projects/improvements. The Capital Projects
Fund and the Capital Improvement Fund receive revenue from capital grants and transfers-in from other
funds. There were no capital projects budgeted for either fund at the end of fiscal year ending 9/30/2014.
Proprietary funds:
The Village’s proprietary funds provide the same type of information found in the
government-wide financial statements, but in more detail.
The table below summarizes the operating income (loss) and the change in net position for each of the
Village’s proprietary funds. At the end of the year, total net positions of the proprietary funds were
$19,035,029, decreasing $540,636 (2.8% from the prior period). As noted earlier, the major decrease in
net position in the Water utility resulted from an increase in spending on renewal and replacement
projects in the water utility. Other factors concerning the finances of this major fund have already been
addressed in the discussion of the Village’s business-type activities.
15
PROPRIETARY FUNDS
Change in Operating Income and Net Position
Operating Income (Loss) Change in Net Position
2014 2013 2014 2013
($381,840) $91,051 ($577,408) ($130,639)
Water
44,312 102,230 45,573 103,748
Storm-water
(9,182) (1,742) (8,801) (1,078)
Refuse and Recycling
($346,710) $191,539($540,636) ($27,969)
General Fund Budgetary Highlights
The difference between the original and final amended General fund budget in total for 2014 was an
increase of $447,518 thousand. The most significant portion of this increase ($318,830) was due to the
purchase of a new 800MHZ radio system that was not funded in the original budget. Other large
additions to the budget were roll-forwards of prior year projects ($89,565) and funding for summer camp
counselors ($24,122).
Capital Assets and Debt Administration
Capital assets:
The Village’s capital assets for its governmental and business-type activities total
$31,536,290 (net accumulated depreciation) as of September 30, 2014. These assets include land,
construction in progress, buildings, improvements-other-than-buildings, infrastructure and machinery and
equipment.
Additional information on the Village’s capital assets can be found in Note 3 D., Capital Assets, starting
on page 50 of this report.
VILLAGE OF TEQUESTA
Capital Assets
Governmental Business 2014
Capital Assets Activities Activities
Total
Land $ 634,017 $83,335 $ 717,352
Construction in progress 67,604 - 67,604
Buildings 8,043,526 979,512 9,023,038
Improvements 2,385,930 58,720 2,444,650
Infrastructure 4,544,085 32,596,833 37,140,918
Machinery & Equipment 3,862,270 1,709,903 5,572,173
Intangibles 201,377 - 201,377
Other - K-9 25,763 - 25,763
Total capital assets 19,764,572 35,428,303 55,192,875
Less accumulated depreciation (6,575,029) (17,082,556) (23,657,585)
Total capital assets, net $13,189,543 $18,345,747 $31,535,290
16
Long-term Debt: At the end of the current fiscal year, the Village had no general obligation bonded debt.
All of the Village’s outstanding debt is secured by general revenue sources. The table below summarizes
the Village’s debt position. A more detailed explanation can be found in Note 3.K – Long-Term
Liabilities starting on page 75.
Village of Tequesta - Long Term Debt
Governmental Activities Business-type Activities
Total
2014 2013 2014 2013 2014 2013
Notes payable
$2,519,635 $2,778,261 $5,245,703 $5,553,570 $7,765,338 $8,331,831
Capital leases
385,059 - - - 385,059 -
Compensated absences
484,212 519,181 156,798 139,820 641,010 659,001
Net OPEB Obligation
190,000 158,000 27,000 18,000 217,000 176,000
Total Long Term Debt
$3,578,906 $3,455,442 $5,429,501 $5,711,390 $9,008,407 $9,166,832
Economic Factor and Next Year’s Budgets and Rates
The following economic factors currently affect the Village of Tequesta and were considered in
developing the 2014-2015 fiscal year budgets.
The Village Council’s decision to raise the millage rate from 6.050 mills to 6.292 and an increase in
property values will result in an increase in tax revenues. The Village is expecting property values
to continue to rise.
Interest rates remain low and there is no indication that the Federal Reserve will take any action to
raise rates. There was some thought that when the unemployment rate hit 6.5%, the Fed might take
action, however, February unemployment rates dropped to 5.5% without indication from the Fed
that interest rates would increase.
Revenues from sales taxes continue to be flat and current trends are not predicting any immediate
change unless consumer confidence increases.
There is an uptick in the housing market and new home construction is beginning to improve.
The Village continues to look into annexation of surrounding properties, however, most of this type
of annexation is expected be smaller parcels.
The CPI is expected to be around 2%.
The U.S. Gross domestic Product has been growing at a rate slightly over 2%.
Government data shows consecutive months that the market created more than 200,000 jobs.
The Village of Tequesta’s water rates increased 2.98% on October 1, 2013.
Requests for Information
This financial report is designed to provide a general overview of the Village of Tequesta’s finances for all
those with an interest in the government’s finances. Questions concerning any of the information provided
in this report or requests for additional financial information should be addressed to the Village of Tequesta,
Finance Department, 345 Tequesta Drive, Tequesta, Florida 33469.
17
BASIC FINANCIAL STATEMENTS
VILLAGE OF TEQUESTA, FLORIDA
STATEMENT OF NET POSITION
SEPTEMBER 30, 2014
Business-
Governmentaltype
ActivitiesActivitiesTotal
Assets
Cash and cash equivalents3,642,251$ 5,464,041$ 9,106,292$
Investments176,582 122,181 298,763
Receivables, net404,737 382,305 787,042
Inventories52,368 56,234 108,602
Prepaid items174,466 61,820 236,286
Other current assets10,527 -- 10,527
Net pension asset449,770 -- 449,770
Capital assets not being depreciated701,621 83,335 784,956
Capital assets being depreciated, net12,487,922 18,262,412 30,750,334
Total Assets
24,432,32818,100,244 42,532,572
Deferred Outflows of Resources
Deferred charge on refunding-- 302,367 302,367
Total deferred outflows of resources-- 302,367 302,367
Liabilities
Accounts payable119,819 226,151 345,970
Accrued liabilities 20,570279,892 300,462
Customer deposits19,074 32,031 51,105
Due to other governments2,646 -- 2,646
Noncurrent liabilities:
Due within one year365,817 343,385 709,202
Due in more than one year3,213,089 5,086,115 8,299,204
Total Liabilities
5,708,2524,000,337 9,708,589
Deferred Inflows of Resources
Deferred revenue134,593 -- 134,593
Total deferred inflows of resources134,593 -- 134,593
Net Position
Net investment in capital assets10,284,849 13,402,412 23,687,261
Restricted:
Debt Service269,915 -- 269,915
Building348,135 -- 348,135
Law Enforcement322,689 -- 322,689
Unrestricted2,739,726 5,632,617 8,372,343
Total Net Position
$ 19,035,02913,965,314$ 33,000,343$
The accompanying notes are an integral part of these financial statements.
18
VILLAGE OF TEQUESTA, FLORIDA
STATEMENT OF ACTIVITIES
FOR THE FISCAL YEAR ENDED SEPTEMBER 30, 2014
Net (Expense) Revenue and
Program RevenuesChanges in Net Position
ChargesOperatingPrimary Government
forGrants andGovernmentalBusiness-typeTotal
Functions/ProgramsExpensesServicesContributionsActivitiesActivities
Primar Governmen
yt
Governmental activities:
General government1,770,326$ 694,220$ --$ (1,076,106)$ --$ (1,076,106)$
Public safety6,222,408 1,755,652 56,023 (4,410,733) -- (4,410,733)
Transportation1,009,693 -- -- (1,009,693) -- (1,009,693)
Leisure services583,445 76,918 7,125 (499,402) -- (499,402)
Interest on long-term debt114,398 -- -- (114,398) -- (114,398)
Total governmental activities9,700,270 2,526,790 63,148 (7,110,332) -- (7,110,332)
Business-type activities-- -- -- -- -- --
Water4,782,022 4,155,865 -- -- (626,157) (626,157)
Stormwater utility279,051 323,363 -- -- 44,312 44,312
Refuse and recycling489,977 480,795 -- -- (9,182) (9,182)
Total business-type activities5,551,050 4,960,023 -- -- (591,027) (591,027)
Total primary government15,251,320$ 7,486,813$ 63,148$ (7,110,332) (591,027) (7,701,359)
General Revenues
Ad valorem taxes4,767,948 -- 4,767,948
Utility taxes703,623 -- 703,623
Communication service tax324,530 -- 324,530
Insurance premium taxes100,617 -- 100,617
Business taxes87,330 -- 87,330
Franchise fees based on gross receipts401,859 -- 401,859
Unrestricted intergovernmental revenues770,616 -- 770,616
Unrestricted investment earnings13,184 14,976 28,160
Miscellaneous revenues53,406 35,415 88,821
Total general revenues7,223,113 50,391 7,273,504
Change in Net Position
(540,636)112,781 (427,855)
Net Position
- Beginning
19,575,66513,852,533 33,428,198
Net Position
- Ending
$ 19,035,02913,965,314$ 33,000,343$
The accompanying notes are an integral part of these financial statements.
19
VILLAGE OF TEQUESTA, FLORIDA
BALANCE SHEET
GOVERNMENTAL FUNDS
SEPTEMBER 30, 2014
Other Total
GeneralGovernmentalGovernmental
FundFundsFunds
Assets
Cash and cash equivalents3,359,836$ 282,415$ 3,642,251$
Investments176,582 -- 176,582
Receivables, net404,737 -- 404,737
Inventories33,403 18,965 52,368
Prepaid items174,466 -- 174,466
Other current assets10,527 -- 10,527
Total Assets
301,3804,159,551 4,460,931
Liabilities
Accounts payable119,819 -- 119,819
Accrued liabilities279,892 -- 279,892
Due to other governments19,074 -- 19,074
Other current liabilities2,646 -- 2,646
Total Liabilities
--421,431 421,431
Deferred Inflows of Resources
--134,593 134,593
Unavailable revenue
--134,593 134,593
Total deferred inflows of resources
Fund Balances
Nonspendable:
Inventories33,403 18,965 52,368
Prepaid items174,466 -- 174,466
Restricted:
Debt service269,915 -- 269,915
Building348,135 -- 348,135
Law enforcement50,000 272,689 322,689
Assigned to:
Subsequent year's budget13,600 -- 13,600
Hurricane/disaster emergency1,000,000 -- 1,000,000
Capital projects-- 9,726 9,726
Unassigned:
--1,714,008 1,714,008
General Fund
301,3803,603,527 3,904,907
Total Fund Balances
Total Liabilities, Deferred Inflows of
$ 301,3804,159,551$ 4,460,931
Resources and Fund Balances
Amounts Reported for Governmental Activities in the
Statement of Net Position are Different Because:
Capital assets used in the governmental activities are not financial resources and,
therefore, are not reported in the funds.13,189,543
Net pension assets are not considered to represent a financial asset in the governmental funds449,770
Long-term liabilities, including notes payable, are no due and payable in the current
period and, therefore, are not reported in the governmental funds:(3,578,906)
Net Position of Governmental Activities
$ 13,965,314
The accompanying notes are an integral part of these financial statements.
20
VILLAGE OF TEQUESTA, FLORIDA
STATEMENT OF REVENUES, EXPENDITURES AND CHARGES IN FUND BALANCES
GOVERNMENTAL FUNDS
FOR THE FISCAL YEAR ENDED SEPTEMBER 30, 2014
TotalTotal
GeneralNonmajorGovernmental
FundFundsFunds
Revenues
Ad valorem taxes4,767,948$ --$ 4,767,948$
Other taxes1,216,100 -- 1,216,100
Charges for services1,102,496 -- 1,102,496
Intergovernmental816,323 -- 816,323
Intragovernmental519,188 -- 519,188
Licenses and permits433,428 -- 433,428
Franchise fees401,859 -- 401,859
Fines and forfeitures31,977 287,621 319,598
Rents and royalties136,906 -- 136,906
Miscellaneous64,855 -- 64,855
Grants, contributions and donations21,166 -- 21,166
Investment earnings13,184 -- 13,184
Total Revenues
287,6219,525,430 9,813,051
Exenditures
p
Current:
General government1,614,291 -- 1,614,291
Public safety5,900,978 -- 5,900,978
Transportation858,787 -- 858,787
Leisure services507,069 -- 507,069
Capital outlay831,240 -- 831,240
Debt service:
Principal306,411 -- 306,411
Interest114,398 -- 114,398
Fiscal charges12,736 -- 12,736
Total Exenditures
p
--10,145,910 10,145,910
Excess (Deficiency) of Revenues
Over (Under) Exenditures
p
287,621(620,480) (332,859)
Other Financing Sources (Uses)
Transfers in150,000 -- 150,000
Transfers out-- (150,000) (150,000)
Capital lease432,844 -- 432,844
Total other financing sources (uses)582,844 (150,000) 432,844
Net change in fund balances(37,636) 137,621 99,985
Fund Balance
s- Beginning
163,7593,641,163 3,804,922
$ 301,3803,603,527$ 3,904,907$
Fund Balance
s - Ending
The accompanying notes are an integral part of these financial statements.
21
VILLAGE OF TEQUESTA, FLORIDA
RECONCILIATION OF THE STATEMENT OF REVENUES, EXPENDITURES AND
CHANGES IN FUND BALANCES OF GOVERNMENTAL FUNDS TO THE
STATEMENT OF ACTIVITIES
FOR THE FISCAL YEAR ENDED SEPTEMBER 30, 2014
Amounts reported for governmental activities in the statement of activities
(Page 19) are different because:
Net change in fund balances - total governmental funds (Page 21)99,985$
Governmental funds report capital outlay as expenditures. However,
in the statement of activities, the cost of those assets is allocated
over their estimated useful lives and reported as depreciation
expense. This is the amount by which capital outlay exceeded
depreciation in the current period.
The details of the difference are as follows:
Capital outlay843,960$
Depreciation expense(694,154)
Net Adjustment149,806
The issuance of long-term debt provides current financial resources to
governmental funds, while the repayment of the principal of long-term
debt consumes the current financial resources of governmental funds.
Neither transaction, however, has any effect on net position.
Capital lease (432,844)
Repayment of notes payable principal258,626
Repayment of capital lease principal47,785
(126,433)
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:
The details of the difference are as follows:
Compensated absences34,969
Net OPEB obligation(32,000)
Net pension expense(13,546)
(10,577)
Change in net position of governmental activities (Page 19)112,781$
The accompanying notes are an integral part of these financial statements.
22
VILLAGE OF TEQUESTA, FLORIDA
STATEMENT OF NET POSITION
PROPRIETARY FUNDS
SEPTEMBER 30, 2014
Business-type Activities
WaterNonmajor
FundStormwaterRefuse & RecyclingTotal
Assets
Current assets:
$ 949,0454,414,532$ 100,464$ 5,464,041$
Cash and cash equivalents
Investments110,140 5,942 6,099 122,181
Receivables, net375,193 1,868 5,244 382,305
Inventories55,732 502 -- 56,234
Prepaid items60,338 1,482 -- 61,820
8887,039 659 8,586
Other current assets
Total Current Assets
959,7275,022,974 112,466 6,095,167
Non-current assets:
Capital assets not being depreciated83,335 -- -- 83,335
16,707,8121,554,600 18,262,412--
Capital assets being depreciated, net
Total Non-Current Assets
1,554,60016,791,147 -- 18,345,747
Total Assets
2,514,32721,814,121 112,466 24,440,914
Deferred Outflows of Resources
Deferred charge on refunding302,367 -- -- 302,367
Total Deferred Outflows of Resources
--302,367 -- 302,367
Liabilities
Current liabilities:
Accounts payable214,285 11,866 -- 226,151
Accrued liabilities20,570 -- -- 20,570
Customer deposits32,031 -- -- 32,031
Compensated absences23,500 -- -- 23,500
--319,885 -- 319,885
Notes payable
Total Current Liabilities
11,866610,271 -- 622,137
Noncurrent liabilities
Compensated absences131,231 2,067 -- 133,298
Notes payable4,925,817 -- -- 4,925,817
26,200800 27,000--
Net OPEB obligation
Total Noncurrent Liabilities
2,8675,083,248 -- 5,086,115
Total Liabilities
14,7335,693,519 -- 5,708,252
Net Position
Net investment in capital assets11,847,812 1,554,600 -- 13,402,412
944,9944,575,157 112,466 5,632,617
Unrestricted
Total Net Position
$ 2,499,59416,422,969$ 112,466$ 19,035,029$
The accompanying notes are an integral part of these financial statements.
23
VILLAGE OF TEQUESTA, FLORIDA
STATEMENT OF REVENUES, EXPENDITURES AND CHARGES IN NET POSITION
PROPRIETARY FUNDS
FOR THE FISCAL YEAR ENDED SEPTEMBER 30, 2014
Business-type Activities
WaterNonmajor
FundStormwaterRefuse & RecyclingTotal
Operating Revenues
Charges for services:
Metered water sale4,095,960$ --$ --$ 4,095,960$
Tap fees59,905 -- -- 59,905
Stormwater fees-- 323,363 -- 323,363
Refuse & recycling fees-- -- 480,795 480,795
Total Operating Revenues
323,3634,155,865 480,795 4,960,023
Operating Expenses
Cost of sales and services:
Plant production1,368,893 -- -- 1,368,893
Distribution1,157,515 -- -- 1,157,515
Stormwater-- 159,887 -- 159,887
Purchased services-- -- 482,922 482,922
Management services499,785 11,978 7,055 518,818
Administration452,012 -- -- 452,012
Depreciation1,059,500 107,186 -- 1,166,686
Total Operating Expenses
279,0514,537,705 489,977 5,306,733
Operating Income (Loss)
44,312(381,840) (9,182) (346,710)
Non-Operating Revenues (Expenses)
Miscellaneous revenue35,415 -- -- 35,415
Investment earnings13,334 1,261 381 14,976
Interest expense(227,222) -- -- (227,222)
Other fiscal charges(17,095) -- -- (17,095)
Total Non-Operating Revenues (Expenses)
1,261(195,568) 381 (193,926)
Change in Net Position
45,573(577,408) (8,801) (540,636)
Net Position
- Beginning
2,454,02117,000,377 121,267 19,575,665
Net Position
- Ending
$ 2,499,59416,422,969$ 112,466$ 19,035,029$
The accompanying notes are an integral part of these financial statements.
24
VILLAGE OF TEQUESTA, FLORIDA
STATEMENT OF CASH FLOWS
PROPRIETARY FUNDS
FOR THE FISCAL YEAR ENDED SEPTEMBER 30, 2014
Business-type Activities
Nonmajor
Refuse &
WaterStormwater Recycling
FundFundFundsTotals
Cash Flows from Operating Activities
Cash received from customers, governments and other funds4,186,569$ 323,891$ 480,555$ 4,991,015$
Cash paid to suppliers(2,095,649) (275,394) (530,387) (2,901,430)
Cash paid to employees(1,255,614) 111,039 -- (1,144,575)
Net Cash Provided by (Used in) Operating Activities
159,536835,306 (49,832) 945,010
Cash Flows from Capital and Related Financing Activities
Acquisition and construction of capital assets(94,833) (21,797) -- (116,630)
Principal payments on long-term debt(307,868) -- -- (307,868)
Interest and fiscal charges paid(204,755) -- -- (204,755)
Net Cash Used in Capital and Related Financing Activities
(21,797)(607,456) -- (629,253)
Cash Flows from Investing Activities
Interest received on investments35,502 1,913 832 38,247
Net Cash Provided by Investing Activities
1,91335,502 832 38,247
Net Increase in Cash and Cash Equivalents
139,652263,352 (49,000) 354,004
809,3934,151,180 149,464 5,110,037
Cash and Cash Equivalents
- Beginning
949,0454,414,532 100,464 5,464,041
Cash and Cash Equivalents
- Ending
Adjustments to Reconcile Operating Income (Loss)
to Net Cash Provided by (Used in) Operating Activities
Operating income (loss)(381,840) 44,312 (9,182) (346,710)
Depreciation 1,059,500 107,186 -- 1,166,686
Changes in operating assets and liabilities:
(Increase) decrease in:
Accounts receivable30,704 528 (240) 30,992
Inventories(21,328) 45 -- (21,283)
Prepaid items and other assets(24,731) (1,577) (659) (26,967)
Increase (decrease) in: --
Accounts payable148,198 7,870 (39,751) 116,317
Accrued liabilities (1,531) -- -- (1,531)
Customer deposits1,528 -- -- 1,528
Net OPEB obligation8,200 800 -- 9,000
Compensated absences16,606 371 -- 16,977
Net Cash Provided by (Used in) Operating Activities
$ 159,536835,306$ (49,832)$ 945,010$
Noncash Investing Activities
Change in fair value of investments(3,847)$ (651)$ (451)$ (4,949)$
Noncash Related Financing Activities
Amortization of deferred charge on refunding22,467$ --$ --$ 22,467$
an integral part of these financial statements.
The accompanying notes are
25
VILLAGE OF TEQUESTA, FLORIDA
STATEMENT OF FIDUCIARY NET POSITION
SEPTEMBER 30, 2014
Pension
Trust
Funds
Assets
Cash and cash equivalents531,777$
Investments, at fair value:
Corporate stocks4,629,088
Corporate bonds394,159
Government backed securities407,241
Mutual funds8,169,762
Total investments, at fair value13,600,250
Prepaid items4,388
Contributions receivable120,763
Accrued interest receivable16,752
Total Assets
14,273,930
Liabilities
Accounts payable28,974
Due to broker6,872
Total Liabilities
35,846
Net Position Restricted for Pension Benefits
$14,238,084
The accompanying notes are an integral part of these financial statements.
26
VILLAGE OF TEQUESTA, FLORIDA
STATEMENT OF CHANGES IN FIDUCIARY NET POSITION
FOR THE FISCAL YEAR ENDED SEPTEMBER 30, 2014
Pension
Trust
Funds
Additions
Contributions:
Employer (including State)748,060$
Employee192,251
Total Contributions
940,311
Investment Earnings
Net appreciation in fair value of investments731,794
Interest earnings258,819
Gain on sale of investments176,770
1,167,383
Less investment expenses(72,064)
Net Investment Earnings
1,095,319
Total Additions
2,035,630
Deductions
Benefits paid72,244
Refunds of contributions47,785
Administrative expenses63,276
Total Deductions
183,305
Net Increase
1,852,325
Net Position Restricted for Pension Benefits
12,385,759
Beginning
$14,238,084
Ending
The accompanying notes are an integral part of these financial statements.
27
NOTES TO BASIC FINANCIAL STATEMENTS
VILLAGE OF TEQUESTA, FLORIDA
NOTES TO FINANCIAL STATEMENTS
FOR THE FISCAL YEAR ENDED SEPTEMBER 30, 2014
N1–SSAP
OTEUMMARY OF IGNIFICANT CCOUNTING OLICIES
A. DG-WFS
ESCRIPTION OF OVERNMENTIDE INANCIAL TATEMENTS
The government-wide financial statements (i.e. the statement of net position and the
statement of activities) report information on all non-fiduciary activities of the primary
government and any component units (the Village has no component units). All fiduciary
funds are presented separately. Governmental activities, which normally are supported by
taxes, intergovernmental revenues, and other non-exchange transactions, are reported
separately from business-type activities, which rely to a significant extent on fees and
charges to external customers for support.
B. RE
EPORTING NTITY
The Village of Tequesta, Florida is a municipal corporation organized in 1957 pursuant to
Special Act 57-1915, Laws of Florida. The Village has a Council-Manager form of
government governed by a five (5) member Council elected at large. Each year, the Council
appoints one of its members Mayor, to serve at the pleasure of Council for one year. The
Village’s major operations include public safety (police, fire rescue/EMS, building and
code enforcement), transportation (streets and roads), leisure services (culture and
recreation), water, stormwater, recycling services and general and administrative.
The definition of the financial reporting entity is based upon the concept that elected
officials are accountable to their constituents for their actions. One of the objectives of
financial reporting is to provide users of financial statements with a basis for assessing the
accountability of the elected officials. The financial reporting entity consists of the Village,
organizations for which the Village is financially accountable and other organizations for
which the nature and significance of their relationship with the Village are such that
exclusion would cause the reporting entity’s financial statements to be misleading or
incomplete. The Village is financially accountable for a component unit if it appoints a
voting majority of the organization’s governing board and it is able to impose its will on
that organization or there is a potential for the organization to provide specific financial
benefits to, or impose specific financial burdens on, the Village. The Village has no
component units to report for the fiscal year ending September 30, 2014.
C. BP–G-WFS
ASIS OF RESENTATION OVERNMENTIDE INANCIAL TATEMENTS
While separate government-wide and fund financial statements are presented, they are
interrelated. Both sets of statements distinguish between the governmental and business-
type activities of the Village. The governmental activities column incorporates data from
governmental funds while business-types activities incorporate data from the Village’s
enterprise funds. Separate financial statements are provided for governmental funds,
proprietary funds, and fiduciary funds, even though the latter are excluded from the
government-wide financial statements.
28
VILLAGE OF TEQUESTA, FLORIDA
NOTES TO FINANCIAL STATEMENTS
FOR THE FISCAL YEAR ENDED SEPTEMBER 30, 2014
N1–SSAP()
OTEUMMARY OF IGNIFICANT CCOUNTING OLICIES CONTINUED
C. BP–G-WFS()
ASIS OF RESENTATIONOVERNMENTIDE INANCIAL TATEMENTS CONTINUED
As a general rule, the effect of interfund activity has been eliminated from the government-
wide financial statements, Exceptions to this general rule are payments in lieu of taxes
where the amounts are reasonably equivalent in value to the interfund services provided and
other charges between the Village of Tequesta’s water, and various other functions of the
government. Elimination of these charges would distort the direct costs and program
revenues reported for the various functions concerned.
The Statement of Net Position reports all financial and capital resources of the Village’s
governmental and business-type activities. Governmental activities are those supported by
taxes and intergovernmental revenues. Business-type activities 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 for goods or services that are recovered directly from
customers for services rendered and 2) grants and contributions that are restricted to
meeting the operational or capital requirements of a particular function or segment. Taxes
and other items not properly included among program revenues are reported instead as
general revenues.
D. BP–FFS
ASIS OF RESENTATION UNDINANCIAL TATEMENTS
The fund financial statements provide information about the Village’s funds, including its
fiduciary funds. Separate statements for each fund category – governmental, proprietary
and fiduciary – are presented. The emphasis of fund financial statements is on major
governmental and enterprise funds, each displayed in a separate column. All remaining
governmental and enterprise funds are aggregated and reported as nonmajor funds. Major
individual governmental and enterprise funds are reported as separate columns in the fund
financial statements. Fiduciary funds are presented apart from major and nonmajor funds.
The Village reports the following major governmental fund:
The General Fund is the Village’s primary operating fund. It accounts for all financial
resources of the general government, except those accounted for in another fund.
29
VILLAGE OF TEQUESTA, FLORIDA
NOTES TO FINANCIAL STATEMENTS
FOR THE FISCAL YEAR ENDED SEPTEMBER 30, 2014
N1–SSAP()
OTEUMMARY OF IGNIFICANT CCOUNTING OLICIES CONTINUED
D. BP-()
ASIS OF RESENTATION FUND FINANCIAL STATEMENTS CONTINUED
The Village reports the following major enterprise funds:
TheWater Fund, which accounts for the activities of the water utility, which includes the
processing and distribution of potable water to Village residents and some surrounding
communities, and the Stormwater Utility Fund, which accounts for the construction and
maintenance of the Village’s stormwater system.
Additionally, the Village reports the following fund type:
Thepension trust funds account for the activities of the Public Safety Employees’ and the
General Employees’ Pension Trust Funds, which accumulate resources for pension
benefit payments to qualified employees.
During the course of operations the Village has activity between funds for various purposes.
Any residual balances outstanding at year end are reported as due from/to other funds and
advances to/from other funds. While these balances are reported in fund financial
statements, certain eliminations are made in the preparation of the government-wide
financial statements. Balances between the funds included in governmental activities are
eliminated so that only the net amount is included as internal balances in the governmental
activities column. Similarly, balances between the funds included in the business-type
activities (i.e., the enterprise funds) are eliminated so that only the net amount is included as
internal balances in the business-type activities column.
Further, certain activity occurs during the year involving transfers of resources between
funds. In fund financial statements these amounts are reported at gross amounts as transfers
in/out. While reported in fund financial statements, certain eliminations are made in the
preparation of the government-wide financial statements. Transfers between the funds
included in governmental activities are eliminated so that only the net amount is included as
transfer in the governmental activities column. Similarly, balances between the funds
included in business-type activities are eliminated so that only the net amount is included as
transfers in the business-type activities column.
E. MFBA
EASUREMENT OCUS AND ASIS OF CCOUNTING
The accounting and financial reporting treatment is determined by the applicable
measurement focus and basis of accounting. Measurement focus indicates the type of
resources being measured such as current financial resources or economic resources. The
basis of accounting indicates the timing of transactions or events for recognition in the
financial statements.
30
VILLAGE OF TEQUESTA, FLORIDA
NOTES TO FINANCIAL STATEMENTS
FOR THE FISCAL YEAR ENDED SEPTEMBER 30, 2014
N1–SSAP()
OTEUMMARY OF IGNIFICANT CCOUNTING OLICIES CONTINUED
E. MFBA()
EASUREMENT OCUS AND ASIS OF CCOUNTING CONTINUED
Thegovernment-widefinancial 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. Property taxes are recognized as revenues in the year for which they are
levied. Grants and similar items are recognized as revenue as soon as all eligibility
requirements imposed by the provider have been met.
Thegovernmental fundfinancial statements are reported using the current financial
resources measurement focus and the modified accrual basis of accounting. Revenues are
recognized as soon as they are both measurable and available. Revenues are considered to
be available when they are collectible within the current period or soon enough thereafter to
pay liabilities of the current period. For this purpose, the Village considers revenues to be
available if they are collected within 45 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.
General capital asset acquisitions are reported as expenditures in governmental funds.
Issuance of long-term debt and acquisitions under capital leases are reported as other
financing sources.
Property taxes, sales taxes, franchise taxes, licenses, and interest associated with the current
fiscal period are all considered to be susceptible to accrual and so have been recognized as
revenues of the current fiscal period. Entitlements are recorded as revenues when all
eligibility requirements are met, including any time requirements, and the amount is
received during the period or within the availability period for this revenue source (within
45 days of year-end). Expenditure-driving grants are recognized as revenue when the
qualifying expenditures have been incurred and all other eligibility requirements have been
met, and the amount is received during the period or within the availability period for this
revenue source (within 45 days of year-end). All other revenue items are considered to be
measurable and available only when cash is received by the Village.
The proprietary and pension trust funds are reported using the economic resources
measurement focus and the accrual basis of accounting for reporting its assets and
liabilities.
31
VILLAGE OF TEQUESTA, FLORIDA
NOTES TO FINANCIAL STATEMENTS
FOR THE FISCAL YEAR ENDED SEPTEMBER 30, 2014
N1–SSAP()
OTEUMMARY OF IGNIFICANT CCOUNTING OLICIES CONTINUED
F. BI
UDGETARY NFORMATION
1. Budgetary Basis of Accounting
Annual budgets are adopted on a basis consistent with generally accepted accounting
principles. The appropriated budget is prepared by fund, function and department. Per
established procedures approved by the Village Council, the designated budget officer
may approve a department head‘s request to transfer appropriations between accounts,
within a department. Although the Village Council requires all inter-department budget
amendments to go before the Village Council, the budget was adopted on a fund basis
and the legal level of budgetary control is at that level. What this means is that any
amendments that change the total fund’s budget requires the Village Council to approve
it in the same manner that the original budget was approved – by resolution.
Appropriations in all budgeted funds lapse at the end of the fiscal year even if they have
related encumbrances. Encumbrances are commitments related to unperformed
(executory) contracts for goods or services (i.e., purchase orders, contracts, and
commitments). Encumbrance accounting is utilized to the extent necessary to assure
effective budgetary control and accountability and to facilitate effective cash planning
and control. While all appropriations and encumbrances lapse at year end, valid
outstanding encumbrances (those for which performance under the executor contract is
expected in the next year) are re-appropriated and become part of the subsequent year’s
budget pursuant to state regulations.
G. A,L,DO/IR,N
SSETSIABILITIESEFERRED UTFLOWSNFLOWS OF ESOURCES AND ET
P/FB
OSITIONUNDALANCE
1. Cash and Cash Equivalents
The Village’s cash and cash equivalents are considered to be cash on hand, demand
deposits, and short-term investments with original maturities of three months or less
from the date of acquisition.
2. Investments
Investments for the Village of Tequesta are reported at fair value, except for the position
in the State Board of Administration Investment Pool (SBA). The SBA administers
Florida PRIME and Fund B Surplus Funds Trust Fund (Fund B), both of which are
governed by Chapter 19-7 of the Florida Administrative Code and Chapters 218 and 215
of the Florida Statutes.
32
VILLAGE OF TEQUESTA, FLORIDA
NOTES TO FINANCIAL STATEMENTS
FOR THE FISCAL YEAR ENDED SEPTEMBER 30, 2014
N1–SSAP()
OTEUMMARY OF IGNIFICANT CCOUNTING OLICIES CONTINUED
G. A,L,DO/IR,N
SSETSIABILITIESEFERRED UTFLOWSNFLOWS OF ESOURCES AND ET
P/FB()
OSITIONUNDALANCE CONTINUED
2. Investments (continued)
During the fiscal year, the Village had investments in the SBA Fund B. On September
5, 2014, the SBA transferred the final portion of the original principal in Fund B to all
fund participants as a transfer into Florida PRIME. See Note 3.B for more details.
3. Inventories and Prepaid Items
Inventories are valued at cost using the first-in/first-out (FIFO) method. Inventories
consist of expendable supplies and water distribution repair parts. The cost of such
inventories is recorded as expenditures/expenses when consumed rather than when
purchased.
Certain payments to vendors reflect costs applicable to future accounting periods and are
recorded as prepaid items in both the government-wide and fund financial statements.
The cost of prepaid items is recorded as expenditures/expenses when consumed rather
than when purchased.
4. Capital Assets
Capital assets, which include property, plant, equipment, infrastructure and intangible
assets (e.g. roads, bridges, sidewalks, and similar items), are reported in the applicable
governmental or business-type activities column in the government-wide financial
statements. Capital assets, except for infrastructure and intangible assets, are defined by
the Village as assets with an initial, individual cost of more than $1,000 and an estimated
useful life in excess of two years. For infrastructure and intangible assets the same
estimated minimum useful life is used (in excess of two years), but only those projects
that cost more than $25,000 are reported as capital assets. In the case of the initial
capitalization of general infrastructure assets (i.e., those reported by governmental
activities), the Village of Tequesta chose not to capitalize infrastructure acquired in
fiscal years ending prior to September 30, 2004. As the Village constructs or acquires
additional capital assets each period they are capitalized and reported at historical cost.
The reported value excludes normal maintenance and repairs which are essentially
amounts spent in relation to capital assets that do not increase the capacity or efficiency
of the item or increase its estimated useful life. Donated capital assets are recorded at
their estimated fair value at the date of donation.
33
VILLAGE OF TEQUESTA, FLORIDA
NOTES TO FINANCIAL STATEMENTS
FOR THE FISCAL YEAR ENDED SEPTEMBER 30, 2014
N1–SSAP()
OTEUMMARY OF IGNIFICANT CCOUNTING OLICIES CONTINUED
G. A,L,DO/IR,N
SSETSIABILITIESEFERRED UTFLOWSNFLOWS OR ESOURCES AND ET
P/FB()
OSITIONUNDALANCE CONTINUED
4. Capital Assets (continued)
Interest incurred during the construction phase of capital assets of enterprise funds is
included as part of the capitalized value of the assets constructed. The amount of interest
capitalized depends on the specific circumstances. There was no interest capitalized in
2014.
Land and construction in progress are not depreciated. The other property, plant,
equipment, and infrastructure of the primary government are depreciated using the
straight line method over the following estimated useful lives:
Buildins 20 –40 ears
gy
Improvements 20 –50 years
Infrastructure 20 –50 ears
y
Machiner and equipment 5 –15 ears
yy
Intangibles 5 –20 years
5. Deferred Outflows/Inflows of Resources
In addition to assets, the statement of net position reports a separate section for deferred
outflows of resources. This separate financial statement elementrepresents a
consumption of net position that applies to a future period(s) and so will not be
recognized as an outflow of resources (expense/expenditure) until then. The Village only
has one item that qualifies for reporting in this category. It is the deferred charge on
refunding reported in the government-wide statement of net position and the statement
of net position of the proprietary funds. A deferred charge on refunding results from the
difference in the carrying value of refunded debt and its reacquisition price. This amount
is deferred and amortized over the shorter of the life of the refunded or refunding debt.
34
VILLAGE OF TEQUESTA, FLORIDA
NOTES TO FINANCIAL STATEMENTS
FOR THE FISCAL YEAR ENDED SEPTEMBER 30, 2014
N1–SSAP()
OTEUMMARY OF IGNIFICANT CCOUNTING OLICIES CONTINUED
G. A,L,DO/IR,N
SSETSIABILITIESEFERRED UTFLOWSNFLOWS OR ESOURCES AND ET
P/FB()
OSITIONUNDALANCE CONTINUED
5. Deferred Outflows/Inflows of Resources (continued)
In addition to liabilities, the statement of net position reports 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(s) and so will not be recognized as an inflow of resources (revenue) until that
time. The Village has only one type of item that qualifies for reporting in this category.
The item, revenue collected in advance (deferred revenue at the government-wide level
and unavailable at the fund level), includes revenue from two sources: local business
taxes ($57,000) and lease revenues ($80,238). These amounts are deferred and
recognized as an inflow of resources in the period that the amounts become earned.
6. Net Position Flow Assumption
Sometimes the Village will fund outlays for a particular purpose from both restricted and
unrestricted resources (e.g. restricted bond or grant proceeds). In order to calculate the
amounts to report as restricted – net position and unrestricted – net position in the
government-wide and proprietary fund financial statements, a flow assumption must be
made about the order in which the resources are considered to be applied. It is the
Village’s policy to consider restricted – net position to have been depleted before
unrestricted – net position is applied.
7. Fund Balance Flow Assumptions
Sometimes the Village will fund outlays for a particular purpose from both restricted and
unrestricted resources (the total of committed, assigned, and unassigned fund balance).
In order to calculate the amounts to report as restricted, committed, assigned and
unassigned fund balance in the governmental fund financial statements a flow
assumption must be made about the order in which the resources are considered to be
applied. It is the Village’s policy to consider restricted fund balance to have been
depleted before using any of the components of unrestricted fund balance, Further, when
the components of unrestricted fund balance can be used for the same purpose,
committed fund balance is depleted first, followed by assigned fund balance. Unassigned
fund balance is applied last.
35
VILLAGE OF TEQUESTA, FLORIDA
NOTES TO FINANCIAL STATEMENTS
FOR THE FISCAL YEAR ENDED SEPTEMBER 30, 2014
N1–SSAP()
OTEUMMARY OF IGNIFICANT CCOUNTING OLICIES CONTINUED
G. A,L,DO/IR,N
SSETSIABILITIESEFERRED UTFLOWSNFLOWS OR ESOURCES AND ET
P/FB()
OSITIONUNDALANCE CONTINUED
8. Fund Balance Policies
Fund balance of governmental funds is reported in various categories based on the
nature of any limitations requiring the use of resources for specific purposes. The
Village itself can establish limitations on the use of resources through either a
commitment (committed fund balance) or an assignment (assigned fund balance).
The committed fund balance classification includes amounts that can be used only for
the specific purposes determined by a formal action of the government’s highest level of
decision-making authority. The Village Council is the highest level of decision-making
authority for the Village of Tequesta that can, by adoption of an ordinance or resolution
(equally binding), which are of equal decision-making authority, prior to the end of the
fiscal year, commit fund balance. Once adopted, the limitation imposed by the ordinance
or resolution remains in place until a similar action is taken (the adoption of another
ordinance or resolution) to remove or revise the limitation.
Amounts in the assigned fund balance classification are intended to be used by the
Village for specific purposes but do not meet the criteria to be classified as committed.
The Village Council (Council) has, by adopting a fund balance policy, authorized the
Village Manager and/or the Finance Director to assign fund balance. The Council may
also assign fund balance as it does when appropriating fund balance to cover a gap
between estimated revenue and appropriations in the subsequent year’s appropriated
budget. Unlike commitments, assignments generally only exist temporarily. In other
words, an additional action does not normally have to be taken for the removal of an
assignment. Conversely, as discussed above, an additional action is essential to either
remove or revise a commitment.
H. RE/E
EVENUES AND XPENDITURESXPENSES
1. Program Revenues
Amounts reported as 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 (including special
assessments) that are restricted to meeting the operational or capital requirements of a
particular function or segment. All taxes, including those dedicated for specific
purposes, and other internally dedicated resources are reported as general revenues
rather than as program revenues.
36
VILLAGE OF TEQUESTA, FLORIDA
NOTES TO FINANCIAL STATEMENTS
FOR THE FISCAL YEAR ENDED SEPTEMBER 30, 2014
N1–SSAP()
OTEUMMARY OF IGNIFICANT CCOUNTING OLICIES CONTINUED
H. RE/E()
EVENUES AND XPENDITURESXPENSESCONTINUED
2. Property Taxes
Property tax collections are governed by Chapter 197, Florida Statutes. Property taxes
st
are based on assessed property value at January 1 as determined by the Palm Beach
County Property Appraiser. The Village of Tequesta sets the property tax millage rate in
September. The Palm Beach County Tax Collector bills and collects all property taxes
levied within the County. Florida Statutes limit the county-wide millage rate to a
maximum of 10 mills, excluding voter-approved debt service millage rates. The millage
rate for the Village in fiscal year 2014 was 6.050 mills. Tax bills are mailed out
November 1st and discounts are available for payment made in the following months;
November 4%, December 3%, January 2% and February 1%. Taxes become delinquent
st
on April 1. The owner of a tax certificate may at any time after taxes have been
delinquent (April 1), for two years, file an application for a tax deed sale. Tax deeds are
issued to the highest bidder for the property which is sold at public auction. The Tax
Collector remits current taxes collected through four distributions to the Village in the
first two months of the tax year and one distribution each month thereafter. The Village
recognizes property tax revenue in the period in which they are levied. The Tax
Collector pays the Village interest on monies held from day of collection to day of
distribution.
3. Compensated Absences
Vacation
The Village’s policy permits employees to accumulate earned but unused vacation
benefits, which are eligible for payment upon separation from the Village’s service up to
the maximum allowable limit. The liability for such leave is reported as incurred in the
government-wide and proprietary fund financial statements. A liability for those
amounts is recorded in the governmental funds only if the liability has matured as a
result of employee resignations or retirements. The liability for compensated absences
includes salary-related benefits, where applicable.
Sick Leave
The Village’s policy permits employees to accumulate unused sick leave up to a
maximum amount approved by Council. Upon termination, this leave is eligible for
payment at percentages determined by years of service. The liability for such leave is
reported as incurred in the government-wide and proprietary fund financial statements
when the liability has matured. A liability for those amounts is recorded in the
governmental funds only if the liability has matured as a result of employee resignations
or retirements.
37
VILLAGE OF TEQUESTA, FLORIDA
NOTES TO FINANCIAL STATEMENTS
FOR THE FISCAL YEAR ENDED SEPTEMBER 30, 2014
N1–SSAP()
OTEUMMARY OF IGNIFICANT CCOUNTING OLICIES CONTINUED
H. RE/E()
EVENUES AND XPENDITURESXPENSESCONTINUED
4. Proprietary Funds Operating and Non-operating Revenues and Expenses
Proprietary funds distinguish operatingrevenues and expenses from non-operating
items. Operating revenues and expenses generally result from providing services and
producing and delivering goods in connection with a proprietary fund’s principal
ongoing operations. The principal operating revenues of the water fund, refuse and
recycling fund and stormwater fund are charges to customers for sales and services. The
water fund also recognizes as operating revenue, the portion of tap fees intended to
recover the cost of connecting new customers to the system. Operating expenses for the
enterprise funds include the cost of sales and services, administrative expenses and
depreciation on capital assets. All revenues and expenses not meeting this definition are
reported as non-operating revenues and expenses.
I. UE
SE OF STIMATES
The preparation of financial statements in conformity with accounting principles
generally accepted in the United States of America requires management to make
estimates and assumptions that affect certain reported amounts of assets and liabilities
and disclosure of contingent assets and liabilities at the date of the financial statements
and the reported amounts of revenues and expenditures/expenses during the reporting
period. Actual results could differ from those estimates.
N2–RG-WFFS
OTEECONCILIATION OF OVERNMENTIDE AND UNDINANCIAL TATEMENTS
A.ECDBGF
XPLANATION OF ERTAIN IFFERENCES ETWEEN THE OVERNMENTAL UND
BSG-SNP
ALANCE HEET AND THE OVERNMENTWIDE TATEMENT OF ET OSITION
The governmental fund balance sheet includes a reconciliation between fund balance –
total governmental funds and net position – governmental activities as reported in the
government-wide statement of net position. One element of that reconciliation explains
that “capital assets used in governmental activities are not financial resources and,
therefore are not reported in the funds.” The amount of this reconciling element is
$13,189,543 and details are as follows:
38
VILLAGE OF TEQUESTA, FLORIDA
NOTES TO FINANCIAL STATEMENTS
FOR THE FISCAL YEAR ENDED SEPTEMBER 30, 2014
N2–RG-WFFS
OTEECONCILIATION OF OVERNMENTIDE AND UND INANCIAL TATEMENTS
()
CONTINUED
A.ECDBGF
XPLANATION OF ERTAIN IFFERENCES ETWEEN THE OVERNMENTAL UND
BSG-SNP
ALANCE HEET AND THE OVERNMENTWIDE TATEMENT OF ET OSITION
()
CONTINUED
Land634,017$
Construction in progress67,604
Buildings8,043,526
Less: accumulated depreciation-buildings(2,123,006)
Improvement other than buildings 2,385,930
Less: accumulation depreciation (1,017,725)
Machinery, equipment and vehicles3,862,270
Less: accumulated depreciation - machinery, equipment,
and vehicles(2,807,782)
Infrastructure4,544,085
Less: accumulated depreciation - infrastructure(507,415)
Intangibles201,377
Less: accumulated depreciation - intangibles(117,261)
Other K-925,763
Less: accumulated depreciation - K-9(1,840)
Net Adjustment to Increase Fund Balance-
Total Governmental Funds to Arrive at
Net Position - Governmental Activities
$13,189,543
The final element of that reconciliation explains that “long-term liabilities, including
bonds/notes payable, are not due and payable in the current period and therefore are not
reported in the funds.” The details of this $3,578,906 difference are as follows:
Note payable2,519,635$
Capital leases385,059
Compensated absences484,212
Other post-employment benefits190,000
Net Adjustment to Reduce Fund Balance -
Total Governmental Funds to Arrive at
Net Position – Governmental Activities
$3,578,906
39
VILLAGE OF TEQUESTA, FLORIDA
NOTES TO FINANCIAL STATEMENTS
FOR THE FISCAL YEAR ENDED SEPTEMBER 30, 2014
N3–DNAAF
OTEETAILED OTES ON LL CTIVITIES AND UNDS
CDFI
ASHEPOSITS WITH INANCIAL NSTITUTION
Custodial credit risk-deposits. In the case of deposits, this is the risk that in the event of a
bank failure, the government’s deposits may not be returned to it. All of the Village’s
deposits are held in qualified public depositories pursuant to State of Florida Statutes,
Chapter 280, Florida Security for Public Deposits Act. Under the Act, every qualified
public depository shall deposit with the Treasurer eligible collateral of the depository to be
held subject to his or her order. The pledging level may range from 25% to 200% of the
average monthly balance of public deposits depending upon the depository’s financial
condition and establishment period. All collateral must be deposited with an approved
financial institution. Any potential losses to public depositors are covered by applicable
deposit insurance, sale of securities pledged as collateral and, if necessary, assessments
against other qualified public depositories of the same type as the depository in default. At
September 30, 2014, none of the Village’s primary bank balances were exposed to custodial
credit risk.
I
NVESTMENTS
The Village has adopted an investment policy in accordance with Florida Statutes and is
authorized to invest in obligations of the U.S. Treasury, its agencies and instrumentalities,
certificates of deposit, the State Board of Administration Investment Pool, any
intergovernmental investment pools authorized pursuant to Chapter 163 of the Florida
Statutes, SEC registered money market funds with the highest credit quality rating from a
nationally recognized rating agency, and securities of any interest in any open-end or closed-
end management type investment company or investment trust registered under the
Investment Company Act of 1940, provided that the portfolio is limited to obligations of U.S.
government, its agencies and instrumentalities and to repurchase agreements fully
collateralized by such U.S. government obligations and provided that such investment
company or investment trust takes delivery of such collateral either directly or through an
authorized custodian.
The State Board of Administration (SBA) administers the Florida PRIME investment pool
which is governed by Chapter 19-7 of the Florida Administrative Code and Chapters 218 and
215 of the Florida Statutes. The Florida PRIME is not a registrant with the Securities and
Exchange Commission (SEC); however, the Board has adopted operating procedures
consistent with the requirements for a 2a-7-like fund, which permits money market funds to
use amortized cost to maintain a constant net asset value (NAV) of $1 per share. As a
participant, the Village invests in a pool of investments owning a share of the pool, not the
underlying securities. The fair value of the position in the Florida PRIME is equal to the value
of the pool shares. The investments in the Florida PRIME are not insured by FDIC or any
other governmental agency.
40
VILLAGE OF TEQUESTA, FLORIDA
NOTES TO FINANCIAL STATEMENTS
FOR THE FISCAL YEAR ENDED SEPTEMBER 30, 2014
N3–DNAAF()
OTEETAILED OTES ON LL CTIVITIES AND UNDS CONTINUED
B. I()
NVESTMENTS CONTINUED
Prior to September 5, 2014, the SBA administered, and the Village participated in, the Fund
B “reserve” account (a participant in the Fund B Surplus Funds Trust Fund acting as
subordinated equity). Due to the lack of an actively traded market for Fund B securities, the
“fair value” was an estimate of the liquidation value that was determined through a
collaborative process among various pricing experts and sources in the marketplace. On
September 5, 2014, the SBA transferred the final portion of the original principal in Fund B
to all fund participants as a transfer into Florida PRIME. On September 26, 2014 the SBA
completed the sale of all remaining Fund B collateral assets, which will continue to be
invested in an SEC-registered 2a-7 money market fund until the transfer back to Florida
PRIME. The Fund B Trust Fund will continue to hold the remaining reserve until directed by
the SBA Trustees to distribute to Florida PRIME, which is expected to occur sometime in the
first quarter of 2015. The final amount to be transferred is uncertain, but will not be retained
as a new reserve fund. Rather, the final distribution will be based on the average account
balance at the time of the final distribution. Until that time, the Village will report an estimate
of the amount of distribution (based upon the difference between the NAV value of Fund B
prior to September 5, 2014, and the original principal) distributed as other assets.
As of September 30, 2014, the Village of Tequesta had the following demand deposits and
investments:
Weighted
Credit
Average Rating Percent
Deposits and Investments
Fair ValueMaturity(S&P)Distribution
Demand Deposits9,104,542$96.8%
SBA-Florida PRIME298,76339 days3.2%
AAAm
Total Investments298,763
Total Deposits and Investments
$ 100%9,403,305
Interest Rate Risk
The Village manages its exposure to declines in fair values by limiting the weighted
average maturity of its investments portfolio to less than five years. The Village doesn’t
have a formal policy related to a specific investment related risk.
41
VILLAGE OF TEQUESTA, FLORIDA
NOTES TO FINANCIAL STATEMENTS
FOR THE FISCAL YEAR ENDED SEPTEMBER 30, 2014
N3–DNAAF()
OTEETAILED OTES ON LL CTIVITIES AND UNDS CONTINUED
B. I()
NVESTMENTS CONTINUED
Credit Risk
This is the risk that a debt issuer will not fulfill its obligations. The Village limits credit risk
by requiring investments be limited to specific securities and short-term obligations of U.S.
corporations that are rated at one of the three highest classifications as established by a
nationally recognized statistical rating organization.
Concentration of Credit Risk
At this time the Village is invested in the SBA investment pool which represents 3% of
total deposits and investments.
Custodial Credit Risk-Investments
Is the risk that, in the event of the failure of the counterparty, the government will not be
able to recover the value of its investments or collateral securities that are in the possession
of an outside party. At this time, the Village is only invested in the State Board of
Administration of Florida (SBA) investment pool.
Investments – Public Safety Pension Trust Fund
Investment Policy Statement
The Pension Board of Trustees, as fiduciaries, adopts an Investment Policy Statement and
directs that it applies to all assets under their control. It is the Board’s intention to review the
policy at least annually subsequent to the actuarial report and to amend this statement to
reflect any changes in philosophy, objectives, or guidelines. When the Investment Manager
feels that the specific objectives defined in the statement cannot be met, or the guidelines
constrict performance, the Investment Manager will present a formal modified investment
policy statement to the Board of Trustees at a meeting for the Board’s review. Once the
Board has adopted, the new investment policy goes into effect 31 days after it has been filed
with the State of Florida and the Village of Tequesta. There were no changes to the
Investment Policy Statement for the fiscal year ending September 30, 2014 and the
investments of the Public Safety Pension Trust Fund were in compliance with the investment
policy.
42
VILLAGE OF TEQUESTA, FLORIDA
NOTES TO FINANCIAL STATEMENTS
FOR THE FISCAL YEAR ENDED SEPTEMBER 30, 2014
N3–DNAAF()
OTEETAILED OTES ON LL CTIVITIES AND UNDS CONTINUED
B. I()
NVESTMENTS CONTINUED
Investments – Public Safety Pension Trust Fund (continued)
As of September 30, 2014, the Village of Tequesta’s Public Safety Pension Trust Fund had the
following demand deposits and investments:
Percent Percent of
Fair Value
DistributionNet Position
Cash10,029$ 0.09% 0.00%
Short Term Investments418,695 3.88% 3.84%
Mutual Funds - Fixed Income3,614,982 33.49% 33.19%
Corporate stocks2,765,951 25.63% 25.39%
Exchange Traded Fund - Equities21,270 0.20% 0.20%
Mutual Funds - Equities3,962,905 36.71% 36.38%
Total
$ 10,793,832 100.00% 99.00%
Public Safety Pension Trust Fund Target Allocation
Target
Asset Class Range
Allocation
Domestic Equity 50%40%-60%
10%-25%
International Equity 15%
Total Equities
65%60%-70%
Domestic Core Fixed Income 30%25%-40%
Diversified Fixed Income 0%-10%
5%
Total Fixed Income
35%30%-50%
Interest Rate Risk
Is the risk that changes in interest rates will adversely affect the fair value of an investment in
debt securities. Generally, the longer the time to maturity the greater the exposure. The Plan
does not have a formal policy relating to interest rate risk, however:
The established performance objectives require investment maturities to provide
sufficient liquidity to pay obligations as they become due.
At September 30, 2014, there were no direct investments in debt instruments. However,
there were investments in mutual funds that included debt instruments in their portfolio.
43
VILLAGE OF TEQUESTA, FLORIDA
NOTES TO FINANCIAL STATEMENTS
FOR THE FISCAL YEAR ENDED SEPTEMBER 30, 2014
N3–DNAAF()
OTEETAILED OTES ON LL CTIVITIES AND UNDS CONTINUED
B. I()
NVESTMENTS CONTINUED
Public Safety Pension Trust Fund Target Allocation (continued)
Credit Risk
Is the risk that a debt issuer will not fulfill its obligations. The investment policy limits credit
risk by requiring that:
Fixed income investments must hold a rating in one of the four highest classifications
by a major rating service.
Equities must be traded on a national exchange.
Money market investments must hold a minimum rating of Standard & Poor’s A1 or
Moody’s P1.
Concentration of Credit Risk
Is the risk of loss attributed to the magnitude of an investment in a single issuer. The
investment policy limits exposure to this risk by:
Limiting investments in common stock, capital stock or convertible stock of any one
issuing company or aggregate of any one issuing company to 5% of the outstanding
capital stock of the company.
Limiting the value of corporate bonds issued by any single corporation to not more than
5% of the total fund.
Limiting investments in corporate common stock and convertible bonds (not exceed
70% of the fund assets at fair value). Mortgage-backed securities issued by non-
government entities are limited to 15% of the fixed income portfolio.
Limiting investments in foreign securities (not exceed 15% of the value at cost of the
fund).
Rate of Return
For the fiscal year ended September 30, 2014, the annual money-weighted rate of return on
pension plan investments, net of pension plan investment expense, was 7.46%. The money-
weighted rate of return expresses investment performance, net of investment manager and
consultant expenses adjusted for the changing amounts actually invested. Inputs to the
internal rate of return calculation are determined on a monthly basis.
Custodial Credit Risk-Investments
Is the risk that, in the event of the failure of the counterparty, the government will not be able
to recover the value of its investments or collateral securities that are in the possession of an
outside party. The Plan’s investment policy limits exposure to this risk by:
Requiring all securities to be held with a third party custodian.
44
VILLAGE OF TEQUESTA, FLORIDA
NOTES TO FINANCIAL STATEMENTS
FOR THE FISCAL YEAR ENDED SEPTEMBER 30, 2014
N3–DNAAF()
OTEETAILED OTES ON LL CTIVITIES AND UNDS CONTINUED
B. I()
NVESTMENTS CONTINUED
Public Safety Pension Trust Fund Target Allocation (continued)
Custodial Credit Risk-Investments
Requiring security transactions between a broker/dealer and the custodian involving the
purchase or sale of securities by transfer of money or securities are made on a “delivery
vs. payment” basis to ensure that the custodian will have the security or money, as
appropriate, in hand at the conclusion of the transaction.
Investments – General Employees’ Pension Trust Fund
Investment Policy Statement
The Pension Board of Trustees, as fiduciaries, adopts an Investment Policy Statement and
directs that it applies to all assets under their control. It is the Board’s intention to review
the policy at least annually subsequent to the actuarial report and to amend this statement to
reflect any changes in philosophy, objectives, or guidelines. When the Investment Manager
feels that the specific objectives defined in the statement cannot be met, or the guidelines
constrict performance, the Investment Manager will present a formal modified investment
policy statement to the Board of Trustees at a meeting for the Board’s review. Once the
Board has adopted, the new investment policy goes into effect 31 days after it has been
filed with the State of Florida and the Village of Tequesta. There were no changes to the
Investment Policy Statement for the fiscal year ending September 30, 2014 and the
investments of the General Employees’ Pension Trust Fund were in compliance with the
investment policy.
45
VILLAGE OF TEQUESTA, FLORIDA
NOTES TO FINANCIAL STATEMENTS
FOR THE FISCAL YEAR ENDED SEPTEMBER 30, 2014
N3–DNAAF()
OTEETAILED OTES ON LL CTIVITIES AND UNDS CONTINUED
B. I()
NVESTMENTS CONTINUED
Public Safety Pension Trust Fund Target Allocation (continued)
Investment Policy Statement (continued)
At September 30, 2014, the Village of Tequesta’s General Employees’ Pension Trust Fund
had the following demand deposits and investments:
Weighted Credit Percent
Percent
Average Rating of Net
Distribution
Maturity(Moody)Position
Fair Value
Cash1,277$ 0.04%0.04%
Short Term Investments101,776 3.05%3.04%
Corporate Bonds1.82 years
Bonds24,897 A10.75%0.74%
Bonds37,883 Ba11.13%1.13%
Bonds107,778 Baa13.23%3.22%
Bonds141,781 Baa24.25%4.24%
Bonds81,820 Baa32.45%2.44%
ETF - Exchange Traded Fund 259,464 7.77%7.75%
U.S. Agencies/Treasuries407,241 2.39 yearsAaa12.20%12.17%
Mutual Funds 591,875 17.73%17.68%
Corporate stocks1,582,403 47.40%47.28%
Total$ 100.00%3,338,19599.73%
Target Allocations
In order to provide for a diversified portfolio, the Board has engaged investment
professionals to manage and administer funds. The Board has established the following
asset allocation targets for the total pension trust fund:
46
VILLAGE OF TEQUESTA, FLORIDA
NOTES TO FINANCIAL STATEMENTS
FOR THE FISCAL YEAR ENDED SEPTEMBER 30, 2014
N3–DNAAF()
OTEETAILED OTES ON LL CTIVITIES AND UNDS CONTINUED
B. I()
NVESTMENTS CONTINUED
General Employees' Pension Trust Fund Target Allocation
Target
Range
Asset Class
Allocation
Domestic Equity 40%-60%
50%
15%
10%-25%
International Equity
Total Equities
50%-70%
65%
Domestic Core Fixed Income 25%-40%
30%
5%
Diversified Fixed Income 0%-10%
Total Fixed Income
30%-50%
35%
Interest Rate Risk
Is the risk that changes in interest rates will adversely affect the fair value of an investment
in debt securities. Generally, the longer the time to maturity, the greater the exposure. The
Plan does not have a formal policy relating to interest rate risk, however;
The established performance objectives require investment maturities to provide
sufficient liquidity to pay obligations as they become due.
At September 30, 2014, the weighted average maturity in years for each investment
type is included in the preceding table and ranges from 1.82 to 2.39.
Credit Risk
The Plan limits exposure that a debt issuer will not fulfill its obligations by limiting
investments made or held in the fund to:
Obligations issued by the U.S. Government or obligations guaranteed as to principal
and interest by the U.S. government or by an agency of the U.S. Government;
Bonds, stocks, or commingled funds administered by national or state banks, or other
evidences or indebtedness, issued or guaranteed by a corporation organized under the
laws of the United States, any state or organized territory of the United States, or
District of Columbia provided that the securities meet the following ranking criteria:
Fixed income investments holding a rating in one of the four highest classifications
o
by a major rating service.
Equities that are traded on a National Exchange.
o
47
VILLAGE OF TEQUESTA, FLORIDA
NOTES TO FINANCIAL STATEMENTS
FOR THE FISCAL YEAR ENDED SEPTEMBER 30, 2014
N3–DNAAF()
OTEETAILED OTES ON LL CTIVITIES AND UNDS CONTINUED
B. I()
NVESTMENTS CONTINUED
Investments – General Employees’ Pension Trust Fund (continued)
Concentration of Credit Risk
The Plan’s investment policy limits exposure to this risk by:
Limiting investments in common stock or capital stock of any one issuing company or
aggregate of any one issuing company to 5% of the outstanding capital stock of the
company.
Limiting the value of bonds issued by any single corporation not exceed 10% of the
total fund.
Limiting investments in corporate common stock and convertible bonds not exceed
70% of the fund assets at fair value.
Limiting investments in foreign securities not exceed 25% of the fair value of the fund.
Rate of Return
For the year ended September 30, 2014, the annual money-weighted rate of return on
pension plan investments, net of pension plan investment expense, was 9.73%. The money-
weighted rate of return expresses investment performance, net of investment manager and
consultant expenses adjusted for the changing amounts actually invested. Inputs to the
internal rate of return calculation are determined on a monthly basis.
Custodial Credit Risk
The Plan’s investment policy limits exposure to this risk by:
Requiring all securities to be held by a third party custodian in the name of the Plan.
As of September 30, 2014, the Plan’s investment portfolio was held with a third-party
custodian.
Requiring securities transactions between a broker-dealer and the custodian involving
purchase or sale of securities by the transfer of money or securities to be made on a
“delivery vs. payment” basis to ensure that the custodian will have the security or
money in hand at the conclusion of the transaction.
48
VILLAGE OF TEQUESTA, FLORIDA
NOTES TO FINANCIAL STATEMENTS
FOR THE FISCAL YEAR ENDED SEPTEMBER 30, 2014
N3–DNAAF()
OTEETAILED OTES ON LL CTIVITIES AND UNDS CONTINUED
B. I()
NVESTMENTS CONTINUED
Investments – General Employees’ Pension Trust Fund (continued)
Foreign Currency Risk
Exposure to foreign currency risk is low as;
Foreign investments are through ADR’s (shares listed in the U.S.), Mutual funds
(registered in the U.S.), or Yankee bonds (traded in U.S. dollars).
The investment policy permits a maximum of 25% of the fair value of the fund
securities to be invested in foreign securities.
At September 30, 2014, 6.6% of the fair value of the fund was invested in foreign
securities.
At September 30, 2014, the investments of the General Employees’ Pension Trust Fund were
in compliance with the investment policy.
* See Note F. Pension obligations, for additional information on the Village’s pension
plans.
C. R
ECEIVABLES
Below is the detail of receivables for the general, water, and nonmajor fund including the
applicable allowances for uncollectible accounts:
Storm-Nonmajor
GeneralWaterFundTotalwater
Accounts179,469$ 377,615$ --$ 2,649$ 559,733$
Intergovernmental184,594 457 1,868 2,595 189,514
Other taxes57,954 -- -- -- 57,954
Gross receivables422,017 378,072 1,868 5,244 807,201
Less: allowance for
uncollectibles(17,280) (2,879) -- -- (20,159)
Net Total Receivables$404,737 375,193$ 1,868$ 5,244$ 787,042$
49
VILLAGE OF TEQUESTA, FLORIDA
NOTES TO FINANCIAL STATEMENTS
FOR THE FISCAL YEAR ENDED SEPTEMBER 30, 2014
N3–DNAAF()
OTEETAILED OTES ON LL CTIVITIES AND UNDS CONTINUED
D. CA
APITAL SSETS
Capital assets activity for the fiscal year ended September 30, 2014, was as follows:
BeginningEnding
BalanceAdditionsDeductionsBalance
Governmental Activities:
Capital assets not being depreciated:
Land634,017$ --$ --$ 634,017$
Construction in progress10,710 67,604 (10,710) 67,604
Total Capital Assets Not Being Depreciated
67,604 (10,710) 701,621
644,727
Capital assets being depreciated:
Buildings8,043,526 -- -- 8,043,526
Improvements other than buildings2,385,930 -- -- 2,385,930
Infrastructure4,544,085 -- -- 4,544,085
Machinery & Equipment3,100,967 761,303 -- 3,862,270
Intangible201,377 -- -- 201,377
Other K-9-- 25,763 -- 25,763
Total Capital Assets Being Depreciated
787,066 -- 19,062,951
18,275,885
Less accumulated depreciation for:
Buildings(1,921,918) (201,088) -- (2,123,006)
Improvements other than buildings(906,035) (111,690) -- (1,017,725)
Infrastructure(399,819) (107,596) -- (507,415)
Machinery & Equipment(2,569,489) (238,293) -- (2,807,782)
Intangibles(83,614) (33,647) -- (117,261)
Other K-9-- (1,840) -- (1,840)
Total Accumulated Depreciation
(694,154) -- (6,575,029)
(5,880,875)
Total Capital Assets Being Depreciated, Net
92,91212,395,010 -- 12,487,922
Governmental Activity Capital Assets, Net
$ 160,51613,039,737$ (10,710)$ 13,189,543$
50
VILLAGE OF TEQUESTA, FLORIDA
NOTES TO FINANCIAL STATEMENTS
FOR THE FISCAL YEAR ENDED SEPTEMBER 30, 2014
N3–DNAAF()
OTEETAILED OTES ON LL CTIVITIES AND UNDS CONTINUED
D. CA()
APITAL SSETSCONTINUED
Depreciation expense was charged to the functions/programs of the governmental activities
of the primary Village as follows:
Governmental Activities
General government125,401$
Public safety326,964
Transportation166,563
Leisure services75,226
Total Depreciation Expense - Governmental Activities$694,154
BeginningEnding
BalanceAdditionsDeductionsBalance
Business-Type Activities
Capital assets not being depreciated:
Land83,335$ $ --$ -- 83,335$
Total Capital Assets Not Being Depreciated
83,335 -- -- 83,335
Capital assets being depreciated:
Buildings979,512 -- -- 979,512
Improvements other than buildings58,720 -- -- 58,720
Infrastructure32,596,833 -- -- 32,596,833
Machinery and equipment1,593,273 116,630 -- 1,709,903
Total capital assets being depreciated35,228,338 116,630 -- 35,344,968
Less accumulated depreciation for:
Buildings(610,295) (20,429) -- (630,724)
Improvements other than buildings(15,267) (2,349) -- (17,616)
Infrastructure(14,386,065) (984,356) -- (15,370,421)
Machinery and equipment(904,243) (159,552) -- (1,063,795)
Total Accumulated Depreciation
(1,166,686)(15,915,870) -- (17,082,556)
Total Capital Assets Being Depreciated, Net 19,312,468 -- 18,262,412
Business-Type Activities Capital Assets, Net (1,050,056)$ --$ 18,345,747$
$ 19,395,803
51
VILLAGE OF TEQUESTA, FLORIDA
NOTES TO FINANCIAL STATEMENTS
FOR THE FISCAL YEAR ENDED SEPTEMBER 30, 2014
N3–DNAAF()
OTEETAILED OTES ON LL CTIVITIES AND UNDS CONTINUED
E. AL
CCRUED IABILITIES
Accrued liabilities reported by governmental funds at September 30, 2014, were as follows:
Total
GeneralGovernmental
FundFunds
Salary and employee benefits231,249$ 231,249$
48,643
Other48,643
Total Accrued Liabilities$279,892 279,892$
F. PO
ENSION BLIGATIONS
Florida Retirement System - a Statewide Local Government Employees’ Retirement
System (SLGERS)
Plan Description. Full time employees hired before January 1, 1996 are eligible to
participate in the Florida Retirement System (FRS), a cost sharing, multiple-employer,
public retirement system controlled by the State Legislature and administered by the State
of Florida Department of Administration, Division of Retirement. The FRS provides
retirement and disability benefits, annual cost of living adjustments and death benefits to
plan members and beneficiaries. A post-employment health insurance subsidy is also
provided to eligible employees. Benefits are established by Chapter 121, Florida Statutes
and Chapter 22B, Florida Administrative Code. Amendments to the law can only be made
by an act of the Florida Legislature.
The State of Florida issues a publicly available financial report that includes financial
statements and required supplementary information for the FRS. The latest available report
was for the fiscal year ended June 30, 2014. That report may be obtained by writing to the
State of Florida Division of Retirement, Department of Management Services, P.O. Box
9000, Tallahassee, Florida 32315-9000 or visiting the website at http://myfrs.com.
Funding Policy. Contribution requirements of employers and employees and the
amendment of those requirements are governed by Florida statutes. Plan members, with the
exception of DROP participants, contribute 3% of their annual covered salary. Employer
contribution rates are actuarially determined based upon membership tier and plan
provisions. Contribution rates are established by State law and are expressed as a
percentage of covered payroll. The employer contribution rates by job class for the
52
VILLAGE OF TEQUESTA, FLORIDA
NOTES TO FINANCIAL STATEMENTS
FOR THE FISCAL YEAR ENDED SEPTEMBER 30, 2014
N3–DNAAF()
OTEETAILED OTES ON LL CTIVITIES AND UNDS CONTINUED
F. PO()
ENSION BLIGATIONS CONTINUED
Florida Retirement System - a Statewide Local Government Employees’ Retirement
System (SLGERS) (continued)
Village’s employees at September 30, 2014 were as follows: regular employees – 6.07%,
special risk employees – 18.52% and employees participating in the Deferred Retirement
Option Program (DROP) – 12.28%. The regular and special risk employees’ rates include
1.26% for the employer Health Insurance Subsidy contribution and 0.04% for an
administrative fee. The DROP rate includes the 1.26% Health Insurance Subsidy
contribution but the 0.04% administrative fee does not apply to DROP participants.
The Village’s contributions to the FRS for the fiscal years ended September 30, 2014, 2013
and 2012 were $70,577, $69,032 and $67,295, respectively, which were equal to 100
percent of the required contributions for each fiscal year.
The Village of Tequesta Single Employer Defined Benefit Pension Plans
Plan Description.The Village maintains two single employer defined benefit pension
plans, the Public Safety Officers’ Pension Trust Fund and the General Employees’ Pension
Trust Fund (GPTF). The Public Safety Officers’ Pension Trust Fund receives contributions
that may not be used to pay benefits of all employee classes, therefore, two separate trust
funds, the Firefighters’ Pension Trust Fund (FPTF) and the Police Officers’ Pension Trust
Fund (PPTF) are reflected in the financial statements. The General Employee’s Plan is also
reflected as a separate pension trust fund in the financial statements.
Effective February 1, 2013, the PPTF is not available to new employees. Police officers,
who begin work with the Village after February 1, 2013 will be able to participate in a
defined contribution plan.
Summary of Significant Accounting Policies – Basis of Accounting and Valuation of
Investments. The pension trust funds are reported on the accrual basis of accounting. Plan
member and state contributions are recognized as revenues in the period that the
contributions are due. Employer contributions to each Plan are recognized when due and
the employer has made a formal commitment to provide the contributions. Benefits and
refunds are recognized when due and payable in accordance with the terms of the plan. All
plan investments are reported at fair value at the last reported sales price on the last
business day of the fiscal year; securities traded in the over-the-counter market and listed
securities for which no sales was reported on that date are valued at the last reported bid
price. Securities without an established fair value are reported at estimated fair value.
Purchases and sales of securities are recorded on a trade-date basis.
53
VILLAGE OF TEQUESTA, FLORIDA
NOTES TO FINANCIAL STATEMENTS
FOR THE FISCAL YEAR ENDED SEPTEMBER 30, 2014
N3–DNAAF()
OTEETAILED OTES ON LL CTIVITIES AND UNDS CONTINUED
F. PO()
ENSION BLIGATIONS CONTINUED
The Village of Tequesta Single Employer Defined Benefit Pension Plans (continued)
Funding Policies are presented below under each of the plans.
Current Membership in each of the three Plans consisted of the following at September 30,
2014:
FPTFPPTFGPTF
Covered Group
Active plan members16 7 40
Inactive plan members entitled to, but not yet
receiving benefits1 2 2
Inactive plan members or beneficiaries
currently receiving benefits3 2 1
Total
20 11 43
Actuarial Assumptions: Annual Pension Cost (APC), Net Pension Asset (NPA) and Net
Pension Liability (NPL)
The Village’s current contributions were determined through actuarial valuations performed
as of October 1, 2012. The total pension liability was determined using an actuarial
valuation date of October 1, 2013 with the following actuarial assumptions, applied to all
prior periods included in the measurement;
Public Safety Officers' Pension Fund
PoliceGeneral Employees'
Firefighters'Officers'Pension Fund
Valuation Date:
10/1/201310/1/201310/1/2013
Note: Actuarially determined contribution rates are calculated as of October 1, which is one
year prior to the end of the fiscal year in which contributions are reported.
54
VILLAGE OF TEQUESTA, FLORIDA
NOTES TO FINANCIAL STATEMENTS
FOR THE FISCAL YEAR ENDED SEPTEMBER 30, 2014
N3–DNAAF()
OTEETAILED OTES ON LL CTIVITIES AND UNDS CONTINUED
F. PO()
ENSION BLIGATIONS CONTINUED
Actuarial Assumptions: Annual Pension Cost (APC), Net Pension Asset (NPA) and Net
Pension Liability (NPL) (continued)
Public Safety Officers' Pension Fund
PoliceGeneral Employees'
Firefighters'Officers'Pension Fund
Methods and Assumptions Used to Determine Contribution Rates:
Actuarial Cost MethodEntry Age NormalEntry Age NormalAggregate Method
Amortization MethodLevel Dollar, ClosedLevel Dollar, ClosedN/A
Remaining Amortization Period2020N/A
Asset Valuation Method5-Year smoothed market5-Year smoothed market5-Year smoothed market
Inflation3.0%3.0%4.0%
Salary Increases6.0%, including inflation6.0%, including inflation6.0%, including inflation
Investment Rate of Return7.5%7.5%7.5%
Retirement Age100% when first eligible for Normal Retirement of DROP entry
Mortality
RP-200 Combined Healthy Participant Mortality Table for males and females with
mortality improvement projected to all future years using Scale AAA
Other Information
Notes: See Discussion of Valuation Results in the October 1, 2013 Actuarial Valuation Report
* The aggregate actuarial cost method was used to determine the annual required
contribution of the employer for the General Employees’ Pension Fund for the 2014 fiscal
year. This allocation is performed for the group as a whole, not as a sum of individual
allocations. The portion of this Actuarial Present Value allocated to a specific year is called
the employer Normal Cost. Under this method, actuarial gains and losses, plan
amendments, and changes in actuarial assumptions and methods reduce or increase future
Normal Costs.
55
VILLAGE OF TEQUESTA, FLORIDA
NOTES TO FINANCIAL STATEMENTS
FOR THE FISCAL YEAR ENDED SEPTEMBER 30, 2014
N3–DNAAF()
OTEETAILED OTES ON LL CTIVITIES AND UNDS CONTINUED
F. PO()
ENSION BLIGATIONS CONTINUED
Actuarial Assumptions: Annual Pension Cost (APC), Net Pension Asset (NPA) and Net
Pension Liability (NPL) (continued)
The Village’s 2014 annual pension cost and net pension asset for each Plan are shown below.
PoliceGeneral
Firefighters’Officers’Employees'
Annual required contribution (ARC)416,665$ 111,164$ 184,627$
Interest on net pension asset (NPA)(12,735) (11,395) (10,619)
Adjustment to ARC(19,159) (17,256) (17,322)
Annual pension cost 423,089 117,025 191,330
111,164 184,627
Contributions made422,107
(Increase) decrease in NPA982 5,861 6,703
Net Pension Asset - Beginning(169,804) (151,927) (141,585)
$ (146,066)(168,822)$ (134,882)$
- Ending
Net Pension Asset
Net Pension Liability
The components of the net pension liability at September 30, 2014 were as follows:
Police General
Firefighters'Officers'Employees'
Total Pension Liability8,755,066$ 2,736,489$ 3,091,288$
Plan Net Positio
n
3,066,9447,824,203 3,346,937
eenson aysse
$930,863$(330,455)$(255,649)
NtPiLibilit(At)
Plan Net Position as a %
of Total Pension Liability 89.37%112.08%108.27%
56
VILLAGE OF TEQUESTA, FLORIDA
NOTES TO FINANCIAL STATEMENTS
FOR THE FISCAL YEAR ENDED SEPTEMBER 30, 2014
N3–DNAAF()
OTEETAILED OTES ON LL CTIVITIES AND UNDS CONTINUED
F. PO()
ENSION BLIGATIONS CONTINUED
Actuarial Assumptions: Annual Pension Cost (APC), Net Pension Asset (NPA) and Net
Pension Liability (NPL) (continued)
Actuarial Assumptions
The total pension liability (asset) was determined by an actuarial valuation as of October 1,
2012, rolled forward to September 30, 2014, using the following actuarial assumptions,
applied to all periods included in the measurement:
5.86% per annum (2.00% per annum is attributable to long-term
Discount rate:
inflation); this rate was used to discount all future benefit
payments.
Salary increases:Not applicable
Cost-of-living increases:None assumed
Mortality basis:Sex-distinct rates set forth in the RP-2000 Mortality Table for
annuitants, projected to 2013 by Scale AA, as published by the
Internal Revenue Service (IRS) for purposes of Internal
Revenue Code (IRC) section 430; future generational
improvements in mortality have not been reflected.
Retirement:Not applicable
Other decrements:None assumed
Form of payment:Future retirees are assumed to select the 10-year certain and life
annuity form of payment.
Non-investment expenses:Projected liability has been loaded by 20.00% to account for
anticipated administrative expenses.
Future contributions:Contributions from the employer are assumed to be made as
legally required.
Long-Term Expected Rate of Return
The long-term expected rate of return on pension plan investments was determined 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. Best estimates of arithmetic real rates of
return for each major asset class included in the pension plan's target asset allocation as of
September 30, 2014 are summarized in the following table:
57
VILLAGE OF TEQUESTA, FLORIDA
NOTES TO FINANCIAL STATEMENTS
FOR THE FISCAL YEAR ENDED SEPTEMBER 30, 2014
N3–DNAAF()
OTEETAILED OTES ON LL CTIVITIES AND UNDS CONTINUED
F. PO()
ENSION BLIGATIONS CONTINUED
Actuarial Assumptions (continued)
Long-Term Expected
Asset ClassReal Rate of Return
Domestic equity7.5%
International equity8.5
Fixed income2.5
Single Discount Rate
A single discount rate of 7.50% was used to measure the total pension liability. This single
discount rate was based on the expected rate of return on pension plan investments of
7.50%. The projection of cash flows used to determine this single discount rate 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 total
actuarially determined contribution rates and the member rate. Based on these 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 (7.50%) was applied to all periods of projected benefit
payments to determine the total pension liability.
Regarding the sensitivity of the net pension liability to changes in the single discount rate,
the following presents the plan’s net pension liability, calculated using a single discount
rate of 7.50%, as well as what the plan’s net pension liability would be if it were calculated
using a single discount rate that is 1-percentage-point lower or 1-percentage-point higher:
Current Single
Discount Rate
1% Decrease1% IncreaseAssumption
6.50%8.50%
7.50%
Firefighters'2,045,475$ 930,863$ (1,423)$
Police Officers'62,212 (330,455) (653,552)
General Employees'181,729 (255,649) (616,133)
58
VILLAGE OF TEQUESTA, FLORIDA
NOTES TO FINANCIAL STATEMENTS
FOR THE FISCAL YEAR ENDED SEPTEMBER 30, 2014
N3–DNAAF()
OTEETAILED OTES ON LL CTIVITIES AND UNDS CONTINUED
F. PO()
ENSION BLIGATIONS CONTINUED
Annual Pension Cost (APC) and Net Pension Asset (NPA) Three Year Trending.
The Village of Tequesta’s APC, percentage of APC contributed and NPA for the pension
plans, for the current year and each of the two preceding years were as follows:
Three-Year Trend Information
AnnualPercentageNet Pension
Pensionof APCObligation
Fiscal Year EndingCost (APC)Contributed(Asset)
Firefighters' Retirement System
September 30, 2012409,961$ 99.0%(142,665)$
September 30, 2013383,005 107.1%(169,804)
September 30, 2014423,089 99.8%(168,822)
Police Officers' Retirement System
September 30, 2012208,681 97.6%(132,471)
September 30, 2013150,143 113.0%(151,927)
September 30, 2014117,025 95.0%(146,066)
General Employees' Retirement System
September 30, 2012175,447 97.6%(147,878)
September 30, 2013188,587 96.7%(141,585)
September 30, 2014191,330 96.5%(134,882)
59
VILLAGE OF TEQUESTA, FLORIDA
NOTES TO FINANCIAL STATEMENTS
FOR THE FISCAL YEAR ENDED SEPTEMBER 30, 2014
N3–DNAAF()
OTEETAILED OTES ON LL CTIVITIES AND UNDS CONTINUED
F. PO()
ENSION BLIGATIONS CONTINUED
Funded Status and Funding Progress
The funded status of the Plans as of October 1, 2013, the most recent actuarial valuation
date, is as follows:
Actuarial
AccruedUAAL as
ActuarialLiabilityUnfundeda % of
Value(AAL) -AALFundedCoveredCovered
AssetsEntry Age(UAAL) RatioPayrollPayroll
(a)(b)(b) - (a)(a) / (b)( c)((b - a) / c)
Public Safety Pension Fund:
Fire6,861,939$ 8,082,747$ 1,220,808$ 84.9%1,450,827$ 84.1%
Police2,688,884 2,038,883 (650,001) 131.9%509,217 -127.6%
General Employees' Pension Fund*
2,944,7403,180,312 (235,572) 108.0%2,345,459 -10.0%
* For purposes of this schedule, the AAL for the General Employees’ Plan was
determined using the entry age actuarial cost method. Note that the ARC for the Plan
was calculated using the aggregate actuarial cost method.
The schedule of funding progress, presented as required supplementary information (RSI)
following the notes to the financial statements, presents multiyear trend information about
whether the actuarial values of the plan assets are increasing or decreasing over time
relative to the AALs for benefits.
Village of Tequesta Public Safety Employees’ Pension Plan (PSEPP)
PSEPP Plan Description: The PSEPP is administered by a five-member Board of Trustees
and covers all Village police officers and firefighters hired after 1996 (prior to 1996, the
Village participated in the Florida Retirement system). The Plan is also governed by
Chapters 112, 175 and 185 Florida Statutes. As of February 1, 2013 the PPTF portion of
the Public Safety Officers’ Trust Fund was closed to new hires. As a result, no state
contributions from Florida Statutes Chapter 185 will be received as a contribution to the
PPTF portion of the Public Safety Officers’ Trust Fund after calendar year 2013.
60
VILLAGE OF TEQUESTA, FLORIDA
NOTES TO FINANCIAL STATEMENTS
FOR THE FISCAL YEAR ENDED SEPTEMBER 30, 2014
N3–DNAAF()
OTEETAILED OTES ON LL CTIVITIES AND UNDS CONTINUED
F. PO()
ENSION BLIGATIONS CONTINUED
Village of Tequesta Public Safety Employees’ Pension Plan (PSEPP) (continued)
Any firefighter or police officer who completes six or more years of credited service and
attains age 55, or completes 25 years of credited service and attains age 52, is eligible for
normal retirement benefits. The monthly retirement benefit shall be equal to 3% for the
first six (6) years of service, 3.5% for the next four (4) years of service, 4% for the next five
(5) years of service, 3% for the next six (6) years of service, 2% for the next four (4) years
of service and 3% for all years after twenty-five years of service. Early retirement may be
taken after a firefighter or police office attained the age of 50 and has six (6) years of
credited service. In the event of early retirement, benefits are actuarially reduced to take
into account the firefighter or police officer’s younger age and earlier commencement of
retirement benefits.
Such reduction shall not exceed 3% per year. Disability benefits can be received for total
and permanent disabilities as determined by the Board of Trustees. If the pension is
granted, the benefit amount shall be as follows
If the injury or disease is service connected, the firefighter or police officer shall be entitled
to the greater of (a) or (b):
(a) A monthly pension equal to 42% of his/her average monthly compensation as of
his/her disability retirement date, or
(b) The accrued normal retirement benefit.
If the injury or disease is not service connected, the firefighter or police officer shall be
entitled to the greater of (a) or (b):
(a) A monthly pension equal to 25% of his/her average monthly compensation as of
his/her disability retirement date, or
(b) The accrued normal retirement benefit.
If the firefighter or police officer dies prior to retirement from the Village, his beneficiary
shall receive the following benefit:
(a) Line-of-Duty-Death-Benefit – a pension to the spouse (or children) of 50% of Average
Final Compensation for life.
(b) Non-Line-of- Duty-Death – the spouse of a member with six years of credited service
will receive the actuarial equivalent of the accrued early or normal retirement benefit.
61
VILLAGE OF TEQUESTA, FLORIDA
NOTES TO FINANCIAL STATEMENTS
FOR THE FISCAL YEAR ENDED SEPTEMBER 30, 2014
N3–DNAAF()
OTEETAILED OTES ON LL CTIVITIES AND UNDS CONTINUED
F. PO()
ENSION BLIGATIONS CONTINUED
Village of Tequesta Public Safety Employees’ Pension Plan (PSEPP) (continued)
If the firefighter or police officer dies or terminates employment with less than six years of
credited service, he/she is entitled to a refund of the money he contributed.
All retirees and beneficiaries receiving pension benefits will be paid a monthly
supplemental benefit equal to $20 per month for each year of the member’s Credited
Service up to a maximum of $600. The supplemental benefit ceases upon the later of the
death of the retired member or beneficiary.
Deferred Retirement Option Program
Plan members who are age 55 with 6 years of credited service; or age 52 with 25 years of
credited service may make a written election to participate in the Deferred Retirement
th
Option Plan (DROP) before the 27 year of employment. The member’s credited service
and AFC are frozen upon entry into the DROP. The monthly retirement benefit as described
under Normal Retirement is calculated based upon the frozen credited service and AFC.
The maximum DROP period is the earlier of 5 years of participation in the DROP or 30
th
years of employment. The member’s DROP account is credited on September 30 of each
year with investment earnings or losses at the same rate earned by the pension fund less any
administrative expenses. The amount in the DROP account at September 30, 2014 is
$346,206. There is no COLA associated with this account and the normal form of benefit is
a lump sum although other options are available.
Funding Policy. The contribution requirements of plan members and the Village are
established and may be amended by the Village Council. Plan members, with the exception
of DROP participants, are required to contribute 5% of their annual covered salary. The
Village is required to contribute at an actuarially determined rate.
The current employer contribution rate for fiscal year ending September 30, 2014is 21.47%
for police officers and 26.72% for firefighters. Additionally, pursuant to Chapters 175 and
185 of the Florida Statutes, premium taxes on certain property and casualty insurance
contracts written on Village properties is collected by the State and remitted to the Plan.
The amount of insurance premium taxes collected and remitted to the plan totaled $100,617
for fiscal year ending September 30, 2014.
62
VILLAGE OF TEQUESTA, FLORIDA
NOTES TO FINANCIAL STATEMENTS
FOR THE FISCAL YEAR ENDED SEPTEMBER 30, 2014
N3–DNAAF()
OTEETAILED OTES ON LL CTIVITIES AND UNDS CONTINUED
F. PO()
ENSION BLIGATIONS CONTINUED
Village of Tequesta Public Safety Employees’ Pension Plan (PSEPP) (continued)
TheFirefighters’ Pension Trust Fund (part of the PSEPP) does not issue separate stand-
alone financial statements. Included below are the Statement of Fiduciary Net Position and
the Statement of Changes in Fiduciary Net Position as of and for the fiscal year ended
September 30, 2014.
FIREFIGHTERS' PENSION TRUST FUND
STATEMENT OF FIDUCIARY NET POSITION
SEPTEMBER 30, 2014
Assets
Cash and cash equivalents305,878$
Investments7,415,946
Prepaid items1,678
Contributions receivable110,087
Interest receivable4,707
Total Assets
7,838,296
Liabilities
Accounts payable9,526
Due to broker4,567
Total Liabilities
14,093
Net Position Restricted for Pension Benefits
$7,824,203
63
VILLAGE OF TEQUESTA, FLORIDA
NOTES TO FINANCIAL STATEMENTS
FOR THE FISCAL YEAR ENDED SEPTEMBER 30, 2014
N3–DNAAF()
OTEETAILED OTES ON LL CTIVITIES AND UNDS CONTINUED
F. PO()
ENSION BLIGATIONS CONTINUED
Village of Tequesta Public Safety Employees’ Pension Plan (PSEPP) (continued)
FIREFIGHTERS' PENSION TRUST FUND
STATEMENT OF CHANGES IN FIDUCIARY NET POSITION
FOR THE FISCAL YEAR ENDED SEPTEMBER 30, 2014
Additions
Contributions518,072$
Investment earnings567,786
Total Additions
1,085,858
Deductions
Benefits paid53,637
Administrative expenses18,921
Total Deductions
72,558
Net Increase
1,013,300
Net Position Restricted for Pension Benefits
6,810,903
Beginning
Ending7,824,203$
64
VILLAGE OF TEQUESTA, FLORIDA
NOTES TO FINANCIAL STATEMENTS
FOR THE FISCAL YEAR ENDED SEPTEMBER 30, 2014
N3–DNAAF()
OTEETAILED OTES ON LL CTIVITIES AND UNDS CONTINUED
F. PO()
ENSION BLIGATIONS CONTINUED
Village of Tequesta Public Safety Employees’ Pension Plan (PSEPP) (continued)
ThePolice Officers’ Pension Trust Fund (part of the PSEPP) does not issue separate
stand-alone financial statements. Included below are the Statement of Fiduciary Net
Position and the Statement of Changes in Fiduciary Net Position as of and for the fiscal
year ended September 30, 2014.
POLICE OFFICERS' PENSION TRUST FUND
STATEMENT OF FIDUCIARY NET POSITION
SEPTEMBER 30, 2014
Assets
Cash and cash equivalents122,846$
Investments2,949,162
Prepaid items1,678
Contributions receivable2,522
Interest receivable1,563
Total Assets
3,077,771
Liabilities
Accounts payable9,011
Due to broker1,816
Total Liabilities
10,827
Net Position Restricted for Pension Benefits
$3,066,944
65
VILLAGE OF TEQUESTA, FLORIDA
NOTES TO FINANCIAL STATEMENTS
FOR THE FISCAL YEAR ENDED SEPTEMBER 30, 2014
N3–DNAAF()
OTEETAILED OTES ON LL CTIVITIES AND UNDS CONTINUED
PO()
ENSION BLIGATIONS CONTINUED
Village of Tequesta Public Safety Employees’ Pension Plan (PSEPP) (continued)
POLICE OFFICERS' PENSION TRUST FUND
STATEMENT OF CHANGES IN FIDUCIARY NET POSITION
FOR THE FISCAL YEAR ENDED SEPTEMBER 30, 2014
Additions
Contributions137,052$
Investment earnings219,219
Total Additions
356,271
Deductions
Benefits paid10,073
Refunds of contributions43,331
Administrative expenses18,677
Total Deductions
72,081
Net Increase
284,190
Net Position Restricted for Pension Benefits
2,782,754
Beginning
$3,066,944
Ending
Village of Tequesta General Employees’ Pension Plan (GEPP)
Plan Description
The General Employees’ Pension Trust Fund is a single employer defined benefit plan
administered by a five member Board of Trustees that covers all Village general employees
hired after 1996 (prior to 1996, the Village participated in the Florida Retirement System).
Any general employee who attains age 62, or completes 30 years of credited service
regardless of age, is eligible for normal retirement benefits. The monthly amount of normal
retirement income for a general employee is equal to the number of years of credited
service multiplied by 2% of his average highest compensation. Early retirement may be
taken after a general employee has attained the age of 50 and has six (6) years of credited
66
VILLAGE OF TEQUESTA, FLORIDA
NOTES TO FINANCIAL STATEMENTS
FOR THE FISCAL YEAR ENDED SEPTEMBER 30, 2014
N3–DNAAF()
OTEETAILED OTES ON LL CTIVITIES AND UNDS CONTINUED
PO()
ENSION BLIGATIONS CONTINUED
Village of Tequesta General Employees’ Pension Plan (GEPP) (continued)
Plan Description (continued)
service. In the event of early retirement, benefits are actuarially reduced to take into
account the general employee younger age and earlier commencement of retirement
benefits. Such reduction shall not exceed 5% per year. Disability benefits can be received
for total and permanent disabilities as determined by the Board of Trustees. If the pension
is granted, the benefit amount shall be as follows:
If the injury or disease is service connected, the general employee shall be entitled to the
greater of (a) or (b):
(a)A monthly pension equal to 42% of his/her average monthly compensation as of his
disability retirement date, or
(b)An amount equal to the number of years of his/her credited service multiplied by 2% of
his average monthly salary based upon his final five years of service.
If the injury or disease is not service connected, the general employee shall be entitled to
the greater of (a) or (b):
(a)A monthly pension equal to 25% of his/her average monthly compensation based on his
final five (5) years of service, or
(b)An amount equal to the number of years of his/her credited service multiplied by 2% of
his average monthly salary based upon his final five years of service.
If the general employee dies prior to retirement from the Village, the beneficiary shall
receive an amount equal to the vested pension benefit. A survivor benefit is payable to the
beneficiary starting when the member would have reached retirement age.
If the general employee dies or terminates employment with less than six years of credited
service, the employee is entitled to a refund of the money contributed.
Funding Policy
Contribution requirements of Plan members and the Village are established, and may be
amended only by the Village Council. General employees are required to contribute 5% of
their compensation to the Plan. Employer contributions for the fiscal year ending
September 30, 2014 determined using the actuarial valuation dated October 1, 2013 were
9.09% of covered payroll. The Village is required to contribute the remaining amount
necessary to finance the benefits based on an actuarially determined amount.
67
VILLAGE OF TEQUESTA, FLORIDA
NOTES TO FINANCIAL STATEMENTS
FOR THE FISCAL YEAR ENDED SEPTEMBER 30, 2014
N3–DNAAF()
OTEETAILED OTES ON LL CTIVITIES AND UNDS CONTINUED
PO()
ENSION BLIGATIONS CONTINUED
Village of Tequesta General Employees’ Pension Plan (GEPP) (continued)
TheGeneral Employees’ Pension Trust Fund does not issue separate stand-alone financial
statements. Included below are the Statement of Fiduciary Net Position and the Statement
of Changes in Fiduciary Net Position as of and for the year ended September 30, 2014.
GENERAL EMPLOYEES' PENSION TRUST FUND
STATEMENT OF FIDUCIARY NET POSITION
SEPTEMBER 30, 2014
Assets
Cash and cash equivalents103,053$
Investments3,235,142
Contributions receivable8,154
Interest receivable10,482
Prepaid items1,032
Total Assets3,357,863
Liabilities
Accounts payable10,437
Due to broker489
Total Liabilities 10,926
Net Position Restricted for Pension Benefits
$3,346,937
68
VILLAGE OF TEQUESTA, FLORIDA
NOTES TO FINANCIAL STATEMENTS
FOR THE FISCAL YEAR ENDED SEPTEMBER 30, 2014
N3–DNAAF()
OTEETAILED OTES ON LL CTIVITIES AND UNDS CONTINUED
PO()
ENSION BLIGATIONS CONTINUED
Village of Tequesta General Employees’ Pension Plan (GEPP) (continued)
GENERAL EMPLOYEES' PENSION TRUST FUND
STATEMENT OF CHANGES IN FIDUCIARY NET POSITION
FOR THE FISCAL YEAR ENDED SEPTEMBER 30, 2014
Additions
Contributions285,187$
Investment earnings308,314
Total Additions
593,501
Deductions
Benefits paid8,534
Refunds of contributions4,454
Administrative expenses25,678
Total Deductions
38,666
Net Increase
554,835
Net Position Restricted for Pension Benefits
2,792,102
Beginning
$3,346,937
Ending
Village of Tequesta Defined Contribution Pension Plan
The Village of Tequesta’ Single Employer Defined Contribution Pension Plan (the Plan)
was established on February 1, 2013 with and effective date of March 1, 2013. The Plan is a
401(a) money purchase plan in the form of The ICMA Retirement Corporation
Governmental Money Purchase Plan and Trust with assets of the Plan held in trust for the
exclusive benefit of the Plan participants and their beneficiaries. The assets shall be
invested in the VantageTrust, and shall not be diverted to any other purpose. The
employer’s beneficial ownership of Plan assets held in the VantageTrust shall be held for
the further exclusive benefit of the Plan participants. The Village Manager is the
coordinator for the Plan and is authorized to execute all necessary agreements with the
ICMA Retirement Corporation incidental to the administration of the Plan. The Village
serves as Trustee under the Plan.
69
VILLAGE OF TEQUESTA, FLORIDA
NOTES TO FINANCIAL STATEMENTS
FOR THE FISCAL YEAR ENDED SEPTEMBER 30, 2014
N3–DNAAF()
OTEETAILED OTES ON LL CTIVITIES AND UNDS CONTINUED
PO()
ENSION BLIGATIONS CONTINUED
Village of Tequesta Defined Contribution Pension Plan (continued)
In a defined contribution plan, benefits depend solely on amounts contributed to the Plan
plus investment earnings.
The Plan covers Police officers hired after February 1, 2013. Employees must designate a
mandatory participation contribution between the range of 0 to 5% for the Plan year as a
condition of participation in the Plan. The participant shall not have the right to discontinue
or vary the rate after becoming a Plan participant. Newly eligible employees have an
election window of 30 days from the date of eligibility to make the election to participate in
the mandatory contribution portion of the Plan which will begin the first of the month
following the end of the election window. This election is irrevocable and remains in force
until the employee terminates employment or ceases to be eligible to participate in the Plan.
The Village is required to match employee contributions up to a maximum contribution of
5%. Employees are immediately vested in the Plan. Plan provisions are established and
may be amended by the Village of Tequesta.
The Village does not hold or administer resources of the Plan and consequently, the Plan
does not meet the requirements for inclusion in the Village’s financial statements. The Plan
does not issue a stand-alone financial report. The fair value of the plan assets at September
30, 2014 was $68,663. Employee contributions to the Plan for fiscal year ended September
30, 2014 were $27,801; the City’s contribution was $21,449.
OPB(OPEB)O
THER OSTEMPLOYMENT ENEFIT BLIGATIONS
Village of Tequesta’s Other Postemployment Benefits Plan
Plan Description. The Village provides an optional single employer defined benefit post-
employment healthcare plan to eligible individuals. The plan allows its employees and
their beneficiaries, at their own cost, to continue to obtain health, dental and other insurance
benefits upon retirement. The benefits of the plan conform to Florida Statutes, which are
the legal authority for the plan. The plan has no assets and does not issue a separate
financial report.
70
VILLAGE OF TEQUESTA, FLORIDA
NOTES TO FINANCIAL STATEMENTS
FOR THE FISCAL YEAR ENDED SEPTEMBER 30, 2014
N3–DNAAF()
OTEETAILED OTES ON LL CTIVITIES AND UNDS CONTINUED
OPB(OPEB)O()
THER OSTEMPLOYMENT ENEFIT BLIGATIONS CONTINUED
Village of Tequesta’s Other Postemployment Benefits Plan (continued)
Funding Policy. The Village does not directly make a contribution to a health plan on behalf
of retirees. However, retirees and their beneficiaries can purchase from the Village’s
healthcare provider the same health plan, at the same group rates as are charged to the Village
for active employees. Under GASB Statement No. 45, the Village is required to calculate an
offset to the cost of these benefits as an employer contribution, based upon an implicit rate
subsidy prepared by the Village’s actuary. This offset equals the total age-adjusted costs paid
by the Village for its active employees for coverage of the retirees and their dependents for
the year net of the retiree’s own payments for the year. The annual other post employment
benefit cost is calculated based on the annual required contribution (ARC) of the employer,
an amount actuarially determined in accordance with GASB Statement No. 45. The ARC
represents a level of funding that, if paid on an ongoing basis, is projected to cover the current
cost of the benefit. Any unfunded actuarial liabilities are amortized over a period not to
exceed thirty years.
The annual OPEB cost for the Village for the current year and the related information for the
fiscal year ended September 30, 2014 is as follows:
Required Contribution Rates
EmployerPay-as-you-go
Plan membersN/A
Annual OPEB Cost
FY 2014 Annual Required Contribution (ARC)63,000$
Interest on Net OPEB Obligation7,000
Adjustment to ARC(15,000)
Total Annual OPEB Cost55,000$
Net OPEB Obligation
Annual OPEB Cost55,000$
Employer Contributions(14,000)
*
Increase in the Net OPEB Obligation41,000
Net OPEB Obligation (beginning of year)176,000
Net OPEB Obligation (end of year)$217,000
* reflects a contribution credit for the implied subsidy
71
VILLAGE OF TEQUESTA, FLORIDA
NOTES TO FINANCIAL STATEMENTS
FOR THE FISCAL YEAR ENDED SEPTEMBER 30, 2014
N3–DNAAF()
OTEETAILED OTES ON LL CTIVITIES AND UNDS CONTINUED
OPB(OPEB)O()
THER OSTEMPLOYMENT ENEFIT BLIGATIONS CONTINUED
Village of Tequesta’s Other Postemployment Benefits Plan (continued)
The funded status of the Plan as of October 1, 2014, the most recent actuarial valuation date
is as follows:
ctuaraUnfunded
UAAL As %
Ail
Actuarial Accrued AAL uneof Covered
Fdd
Value of liability (UAAL) (2) - Ratio Covered Payroll
Assets(AAL)(1)(1) / (2)Payroll(3) / (4)
$ 380,000--$ 380,000$ 0.0%5,218,000$ 7.3%
Three-Year Trend Information
FiscalAnnualPercentage of AnnualNet OPEB
Year EndOPEB CostOPEB Cost ContributedObligation
2012N/A0%176,000$
*
2013N/A0%176,000
*
2014$63,00022%217,000
* In fiscal years ending September 30, 2012 and 2013, the Village changed to a high
deductible health plan which resulted in retirees declining to purchase the Village's health
insurance and consequently the Village recognized no annual OPEB cost in those years.
Subsequently, the Village elected to offer a traditional health insurance package resulting
in new retirees electing to purchase health insurance through the Village's plan and the
Village incurring and reporting an annual OPEB cost in the fiscal year ending September
30, 2014.
COSC
ONSTRUCTION AND THER IGNIFICANT OMMITMENTS
Construction Commitments
The Village had no significant construction commitments as of September 30, 2014.
72
VILLAGE OF TEQUESTA, FLORIDA
NOTES TO FINANCIAL STATEMENTS
FOR THE FISCAL YEAR ENDED SEPTEMBER 30, 2014
N3–DNAAF()
OTEETAILED OTES ON LL CTIVITIES AND UNDS CONTINUED
COSC()
ONSTRUCTION AND THER IGNIFICANT OMMITMENTS CONTINUED
Inter-Local Agreement
On December 20, 1994, the Village entered into an Inter-local agreement with Palm Beach
County. Per the agreement, Palm Beach County provided for partial funding, land
acquisition and design and construction of a branch library within Tequesta. Upon
completion of the project, the library was leased to Palm Beach County for 50 years for an
annual rent of one dollar. In the event the Village terminates the lease before the end of 50
years, the Village must reimburse Palm Beach County a depreciated value using a useful
life of 25 years based on an initial value of $405,000 calculated on a straight-line basis.
Contracted Services – Refuse and Recycling Collection
The Village entered into a solid waste and recyclable collection agreement with Waste
Management Inc. of Florida on September 13, 2007 for a period of five years beginning
October 01, 2007 and expiring September 30, 2013. With this agreement the Village
granted Waste Management the exclusive franchise for solid waste collection of residential,
commercial, industrial and roll-off refuse, recycling and vegetative waste. The Village, on
August 5, 2010, entered into the first amendment to the agreement separating the diesel fuel
and collection components of the rate allowing for separate calculation of an annual
increase. The annual change in the collection component is determined using the CPI (June
to June) while the annual change in the fuel component is determined using the change in
the cost of diesel fuel determined by reference to EIA/DOE website that reports average
prices. Effective September 30, 2010 the Village entered into a second amendment to the
agreement extending the term of the current agreement and additional five (5) years from
October 1, 2013 and expiring September 30, 2017.
RM
ISK ANAGEMENT
The Village 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.
While the Village cannot anticipate the areas in which potential claims may arise, the
Village purchases commercial insurance to protect against areas of possible exposure
germane to municipal entities such as property, liability, automobile, workers’
compensation, crime, storage tank, inland marine and railroad coverage. Deductibles and
limits vary by coverage and are secured based upon the Village’s tolerance of risk retention
in each area.
73
VILLAGE OF TEQUESTA, FLORIDA
NOTES TO FINANCIAL STATEMENTS
FOR THE FISCAL YEAR ENDED SEPTEMBER 30, 2014
N3–DNAAF()
OTEETAILED OTES ON LL CTIVITIES AND UNDS CONTINUED
RM()
ISK ANAGEMENT CONTINUED
At the Village Council’s direction, the property deductible of $100,000 is applicable for all
perils excluding hurricane/windstorm damage. The Florida Municipal Insurance Trust
(FMIT) applies a named storm deductible of 5% of the 100% value of real and personal
property, personal property of others and business income values at the time of loss or
damage at the locations where the damage occurred, subject to the policy deductible,
whichever is greater. The Village continues to self-insure all properties valued under
$100,000. FMIT issued members in good standing a return of premium credit; the Village
of Tequesta received a total credit of $15,090 in fiscal year 2014 related to policy year
2011/2012 and $21,456 related to policy year 2012/2013.
The Village remains fully insured with the FMIT for workers’ compensation coverage with
statutory limits. Premiums are based upon risk class and remuneration of covered
employees adjusted by an experience modification factor which includes three prior years
of claims history. At the end of each fiscal year, the plan is audited and the Village can
either receive a return of premium or be required to pay additional premium base upon
actual versus estimated payroll. FMIT’s final audit for fiscal year 2012/2013 resulted in the
Village being refunded a total of $23,537, of which $13,280 was workers’ compensation
related. This was due to the temporary reduction in staffing in the police department, which
also impacted our general liability which experienced a refund of $9,622. Property and
auto accounted for the additional $635.
There were no significant changes in insurance coverage from coverage in prior years.
Settled claims have not exceeded the commercial coverage in any of the past three fiscal
years.
LO
EASE BLIGATIONS
Capital Lease
The Village entered into a capital lease with SunTrust in the amount of $432,844 with
funding on October 29, 2013 for the financing of a fire pumper. The applicable interest rate
is 2.423% and interest and principal payments are due annually on November 11th. This is
a nine (9) year lease with ten (10) payments.
74
VILLAGE OF TEQUESTA, FLORIDA
NOTES TO FINANCIAL STATEMENTS
FOR THE FISCAL YEAR ENDED SEPTEMBER 30, 2014
N3–DNAAF()
OTEETAILED OTES ON LL CTIVITIES AND UNDS CONTINUED
LO()
EASE BLIGATIONS CONTINUED
Capital Lease (continued)
The following is a schedule of the future minimum lease payments under this capital lease
arrangement at September 30, 2014:
For the Fiscal Year Ending
September 30, Amount
2015 $ 48,135
2016 48,135
2017 48,135
2018 48,135
2019 48,135
2020-2023 192,538
Total Minimum Lease Payments 433,211
Less: Amount Representing Interest (48,153)
Present Value of Future Minimum Lease Paments
y $385,059
L-TL
ONGERM IABILITIES
Promissory Notes
The Village of Tequesta issues long-term debt to provide funds for the acquisition and
construction of major capital facilities. Promissory notes have been signed for both
governmental and business-type activities. These notes mature in 7 to 14 years and have
interest rates from 3.685% to 4.96% per year. Notes outstanding at September 30, 2014 are
as follows:
Outstanding
SignedOriginalInterestFinalSeptember 30,
Promissory Notes PayableDateBorrowingRateMaturity2014
Government Activities
Public Improvement/P.S. Bldg.9/13/20025,000,000$ 4.28%9/13/20222,519,635$
Business-Type Activities
Water Plant Expansion6/30/2004645,170$ 4.96%4/1/2021253,895
Public Improvement (Refunding)7/14/20086,554,935 3.69%3/1/20284,991,808
Total Business-Type Activities$5,245,703
75
VILLAGE OF TEQUESTA, FLORIDA
NOTES TO FINANCIAL STATEMENTS
FOR THE FISCAL YEAR ENDED SEPTEMBER 30, 2014
N3–DNAAF()
OTEETAILED OTES ON LL CTIVITIES AND UNDS CONTINUED
L-TL()
ONGERM IABILITIES CONTINUED
Legal Debt Margin
The Village of Tequesta is subject to a bonded debt limitation of 10% of total assessed
value. The final gross taxable value per DR-422 at September 30, 2014 was $81,633,154.
As of September 30, 2014 the Village had total outstanding debt in governmental activities
of $3,578,906 of which no portion of the outstanding debt was applicable to the limit.
Changes in Long-Term Liabilities
Changes in the Village of Tequesta’s long-term liabilities for the fiscal year ended
September 30, 2014 are as follows:
Governmental Activities
BeginningEndingDue Within
BalanceAdditionsDeletionsBalanceOne Year
Governmental Activities
Note payable - 20022,778,261$ --$ 258,626$ 2,519,635$ 269,915$
Capital lease-- 432,844 47,785 385,059 38,802
Compensated absences519,181 43,987 78,956 484,212 57,100
32,000 -- 190,000 --
Net OPEB obligation158,000
Governmental Activities
Long-Term Liabilities$ 508,8313,455,442$ 385,367$ 3,578,906$ 365,817$
* For governmental activities, the liability for compensated absences and any other
postemployment benefit obligations is liquidated by the general fund.
Business-Type Activities
BeginningEndingDue Within
BalanceAdditionsDeletionsBalanceOne Year
Business-Type Activities
Note payable - 2004283,895$ --$ 30,000$ 253,895$ 32,000$
Note payable - 20085,269,675 -- 277,867 4,991,808 287,885
Compensated absences139,820 29,316 12,338 156,798 23,500
9,000 -- 27,000 --
Net OPEB obligation18,000
Business-Type Activities
$ 38,3165,711,390$ 320,205$ 5,429,501$ 343,385$
Long-Term Liabilities
76
VILLAGE OF TEQUESTA, FLORIDA
NOTES TO FINANCIAL STATEMENTS
FOR THE FISCAL YEAR ENDED SEPTEMBER 30, 2014
N3–DNAAF()
OTEETAILED OTES ON LL CTIVITIES AND UNDS CONTINUED
L-TL()
ONGERM IABILITIES CONTINUED
Changes in Long-Term Liabilities (continued)
The debt service requirements for the Village’s notes are as follows:
Governmental Activities
Promissory Notes -
For The Fiscal Year Ending Governmental Activities
September 30, PrincipalInterest
2015 $ 269,915 $102,586
2016 281,697 90,805
2017 293,993 78,509
2018 306,825 65,676
2019 320,218 52,283
2020-2022 1,046,987 70,518
Total
$2,519,635$460,377
Business-type Activities
Promissory Notes -
For The Fiscal Year Ending Business-type Activities
September 30, PrincipalInterest
2015 $ 319,885 $ 203,900
2016 333,398 191,748
2017 347,859 179,574
2018 361,778 153,956
2019 375,203 152,121
2020-2024 1,961,572 473,949
2025-2028 1,546,008 100,965
Total
$5,245,703$1,456,213
77
VILLAGE OF TEQUESTA, FLORIDA
NOTES TO FINANCIAL STATEMENTS
FOR THE FISCAL YEAR ENDED SEPTEMBER 30, 2014
N3–DNAAF()
OTEETAILED OTES ON LL CTIVITIES AND UNDS CONTINUED
L-TL()
ONGERM IABILITIES CONTINUED
Total Primary Government Debt
For The Fiscal Year Ending Total Primary Government Debt
September 30, PrincipalInterest
2015 $ 589,800 $ 306,487
2016 615,095 282,553
2017 641,852 258,082
2018 668,603 219,632
2019 695,421 204,404
2020-2024 3,008,559 544,467
2025-2028 1,546,008 100,965
Total
$7,765,338$1,916,590
FB
UNDALANCE
Minimum Fund Balance Policy
The Village Council has adopted a financial policy to maintain a minimum level of
unassigned fund balance in the general fund. The target level is set at two months of general
fund annual revenues (approximately 16.7%). This amount is intended to provide fiscal
stability when economic downturns and other unexpected events occur. If fund balance falls
below the minimum target level because it has been used, essentially as a “revenue” source,
as dictated by current circumstances, the policy provides for actions to replenish the amount
to the minimum target level. Generally, replenishment is to occur within a three-year
period.
78
VILLAGE OF TEQUESTA, FLORIDA
NOTES TO FINANCIAL STATEMENTS
FOR THE FISCAL YEAR ENDED SEPTEMBER 30, 2014
N3–DNAAF()
OTEETAILED OTES ON LL CTIVITIES AND UNDS CONTINUED
IT
NTERFUND RANSFERS
The composition of interfund transfers for the fiscal year ended September 30, 2014 is as
follows:
Interfund Transfers
Transfers In
General
Transfers OutFundTotal
Capital Improvement fund100,000$ 100,000$
50,000
Capital Projects fund50,000
Total$150,000 150,000$
JV
OINTENTURES
The Village, in conjunction with six other municipalities, organized a consortium to provide
mutual fire and emergency aid. The consortium is known as the Northern Area Mutual Aid
Consortium (NAMAC). During 1999, the consortium purchased equipment and supplies as
well as collected contributions. The consortium does not issue separate financial
statements. The Village has not been obligated to contribute any funds to the consortium
since its inception in 1999.
79
REQUIRED SUPPLEMENTARY INFORMATION
VILLAGE OF TEQUESTA, FLORIDA
REQUIRED SUPPLEMENTARY INFORMATION
BUDGETARY COMPARISON SCHEDULE
GENERAL FUND
FOR THE FISCAL YEAR ENDED SEPTEMBER 30, 2014
Variance
with Final
Budget
Budgeted AmountsActual Positive
OriginalFinalAmounts(Negative)
Revenues
Ad valorem taxes4,764,000$ 4,764,000$ 4,767,948$ 3,948$
Other taxes1,178,060 1,141,360 1,216,100 74,740
Intergovernmental786,300 786,300 816,323 30,023
Franchise fees392,000 392,000 401,859 9,859
Charges for services1,052,060 1,052,060 1,102,496 50,436
Intragovernmental518,818 518,818 519,188 370
Grants, contributions and donations500 13,000 21,166 8,166
Licenses and permits338,950 338,950 433,428 94,478
Investment earnings29,800 29,800 13,184 (16,616)
Fines and forfeitures24,800 24,800 31,977 7,177
Miscellaneous36,650 54,650 64,855 10,205
Rents and royalties118,990 118,990 136,906 17,916
Total Revenues
9,234,7289,240,928 9,525,430 290,702
Expenditures
Current:
General government1,546,545 1,583,016 1,614,291 (31,275)
Public safety6,224,075 6,072,467 5,900,978 171,489
Transportation787,400 800,289 858,787 (58,498)
Leisure services590,410 586,712 507,069 79,643
Capital outlay492,850 833,347 831,240 2,107
Debt service:
Principal305,995 305,995 306,411 (416)
Interest125,065 125,065 114,398 10,667
Fiscal charges16,000 16,000 12,736 3,264
Total Expenditures
10,322,89110,088,340 10,145,910 (176,981)
Excess (Deficiency) of Revenues
(1,088,163)(847,412) (620,480) 467,683
Other Financing Sources
Transfers in200,000 200,000 150,000 (50,000)
Capital lease432,850 432,850 432,844 (6)
Total Other Financing Sources
632,850632,850 582,844 (50,006)
Net Change in Fund Balances
(455,313)(214,562) (37,636) 417,677
3,641,1633,641,163 3,641,163 --
Fund Balances-
Beginning
$ 3,185,8503,426,601$ 3,603,527$ 417,677$
Fund Balances
- Ending
See note to budgetary comparison schedule.
80
VILLAGE OF TEQUESTA, FLORIDA
NOTE TO THE BUDGETARY COMPARISON SCHEDULE
FOR THE FISCAL YEAR ENDED SEPTEMBER 30, 2014
N1–BBA
OTEUDGETS AND UDGETARY CCOUNTING
The Village is required to present a budget to actual comparison for the general fund and
any major special revenue fund with a legally adopted annual budget. The Village may not
include nonmajor special revenue funds, or funds of other fund types. This fiscal year, the
Village presents this schedule for the general fund only.
Budgets are adopted on a basis consistent with accounting principles generally accepted in
the United States of America. For budgeting purposes, current year encumbrances are not
treated as expenditures.
All budgets are legally enacted through passage of a resolution. Although the Village
Council requires all inter-department budget amendments to go before the Village Council
for approval, the budget was adopted on a fund basis and the legal level of budgetary
control is at that level. What this means is that any amendment that changes the fund’s total
budget requires the Village Council to approve it in the same manner that the original
budget was approved – by resolution.
Theoriginal budget is the budget in place at the start of the fiscal year, which includes all
of the following
The budget passed by the Village Council
+Subsequent amendments made prior to the start of the fiscal year
+Carryovers from the previous year (encumbrances)
=Original budget
Thefinal budget includes all adjustments to the budget applicable to the fiscal year, even if
they take place after the close of the fiscal year.
During the year, total supplemental appropriations of $453,718 were approved and adopted
for the General Fund. Appropriations are legally controlled at the fund level and
expenditures may not legally exceed budgeted appropriations at that level. Appropriations
lapse at year end.
81
VILLAGE OF TEQUESTA, FLORIDA
REQUIRED SUPPLEMENTARY INFORMATION
SCHEDULE OF CHANGES IN THE VILLAGE'S NET PENSION LIABILITY AND
RELATED RATIOS
FIREFIGHTERS' PENSION TRUST FUND
September 30,
2014
Total Pension Liability
Service cost312,030$
Interest582,897
Changes in benefit terms--
Differences between expected and actual experience450
Changes of assumptions--
Benefit payments(53,637)
Refunds--
Other (increase in state reserve)30,162
Net Change in Total Pension Liability
871,902
7,883,164
Total Pension Liability
- Beginning
$8,755,066
Total Pension Liability
- Ending (a)
Plan Fiduciary Net Position
Contributions - employer and state351,652$
Contributions - non-employer contributing entity100,617
Contributions - member65,803
Net Investment income567,786
Benefit payments(53,637)
Refunds--
Administrative expense(18,921)
Net Change in Plan Fiduciary Net Position
1,013,300
6,810,903
Plan Fiduciary Net Position
- Beginning
$7,824,203
Plan Fiduciary Net Position
- Ending (b)
$930,863
Net Pension Liability -
Ending (a) - (b)
Plan Fiduciary Net Position as a Percentage of the Total
Pension Liability (Asset)
89.37%
Covered Employee Payroll*
$1,316,062
Net Pension Liability as a Percentage of
Covered-Employee Payroll
70.73%
* Actual covered payroll for the fiscal year ending September 30, 2014
ThisscheduleispresentedasrequiredbyaccountingprinciplesgenerallyacceptedintheUnited
StatesofAmerica,however,untilafull10-yeartrendiscompiled,informationispresentedfor
those years available.
82
VILLAGE OF TEQUESTA, FLORIDA
REQUIRED SUPPLEMENTARY INFORMATION
SCHEDULE OF VILLAGE CONTRIBUTIONS
FIREFIGHTERS' PENSION TRUST FUND
September 30,
2014
Actuarially determined contribution416,665$
Contributions in relation to the actuarially determined contribution422,107
Contribution deficiency (excess)(5,442)$
Covered-employee payroll1,316,062$
Contributions as a percentage or covered-employee payroll32.07%
Notes to Schedule
Valuation date:October 1, 2012
ActuariallydeterminedcontributionratesarecalculatedasofOctober1,twoyearsprior
to the end of the fiscal year in which contributions are reported.
Methods and assumptions used to determine contribution rates:
Actuarial cost methodEntry age normal
Amortization methodLevel dollar, closed
Remaining amortization period20 years
Asset valuation method5-year smoothed market
Inflation3.00%
Salary increases6.0% including inflation
Investment rate of return7.5%
100% when first eligible for normal retirement or
Retirement age
DROP entry.
Thisscheduleispresentedasrequiredbyaccountingprinciplesgenerallyacceptedinthe
UnitedStatesofAmerica,however,untilafull10-yeartrendiscompiled,informationis
presented for those years available.
83
VILLAGE OF TEQUESTA, FLORIDA
REQUIRED SUPPLEMENTARY INFORMATION
FIREFIGHTERS' PENSION TRUST FUND
SCHEDULE OF INVESTMENT RETURNS
September 30,
2014
Annual money-weighted rate of return, net of investment expense7.46%
Thisscheduleispresentedasrequiredbyaccountingprinciplesgenerallyacceptedinthe
UnitedStatesofAmerica,however,untilafull10-yeartrendiscompiled,informationis
presented for those years available.
84
VILLAGE OF TEQUESTA, FLORIDA
REQUIRED SUPPLEMENTARY INFORMATION
FIREFIGHTERS' PENSION TRUST FUND
SCHEDULE OF FUNDING PROGRESS
ActuarialUAAL as a
ActuarialAccruedUnfundedPercentage
ActuarialValue ofLiabilityAALFundedCoveredof Covered
ValuationAssets(AAL)(UAAL)RatioPayrollPayroll
(ab)((b-a)c)
Date(a)(b)(b-a)(c)
October 1, 20091,333,909$ 987,399$ (346,507)$ 135.1%749,835$ -46.2%
October 1, 20111,772,107 1,685,977 (86,130) 105.1%858,342 -10.0%
October 1, 20122,079,888 1,887,237 (192,651) 110.2%744,314 -25.9%
85
VILLAGE OF TEQUESTA, FLORIDA
REQUIRED SUPPLEMENTARY INFORMATION
SCHEDULE OF CHANGES IN THE VILLAGE'S NET PENSION LIABILITY AND
RELATED RATIOS
POLICE OFFICERS' PENSION TRUST FUND
September 30,
2014
Total Pension Liability
Service cost161,156$
Interest169,526
Changes in benefit terms--
Differences between expected and actual experience--
Changes of assumptions--
Benefit payments(10,073)
Refunds(43,331)
Other (increase in state reserve)--
Net Change in Total Pension Liability
277,278
2,459,211
Total Pension Liability
- Beginning
$2,736,489
Total Pension Liability
- Ending (a)
Plan Fiduciary Net Position
Contributions - employer and state111,164$
Contributions - member25,888
Net Investment income219,219
Benefit payments(10,073)
Refunds(43,331)
Administrative expense(18,677)
Net Change in Plan Fiduciary Net Position
284,190
2,782,754
Plan Fiduciary Net Position
- Beginning
$3,066,944
Plan Fiduciary Net Position
- Ending (b)
$(330,455)
Net Pension Asset -
Ending (a) - (b)
Plan Fiduciary Net Position as a Percentage of the Total
Pension Liability (Asset)
112.08%
Covered Employee Payroll*
$517,765
Net Pension Liability (Asset) as a Percentage of
Covered-Employee Payroll
-63.82%
* Actual covered payroll for the fiscal year ending September 30, 2014
ThisscheduleispresentedasrequiredbyaccountingprinciplesgenerallyacceptedintheUnited
StatesofAmerica,however,untilafull10-yeartrendiscompiled,informationispresentedfor
those years available.
86
VILLAGE OF TEQUESTA, FLORIDA
REQUIRED SUPPLEMENTARY INFORMATION
SCHEDULE OF VILLAGE CONTRIBUTIONS
POLICE OFFICERS' PENSION TRUST FUND
September 30,
2014
Actuarially determined contribution111,164$
Contributions in relation to the actuarially determined contribution111,164
Contribution deficiency (excess)--$
Covered-employee payroll517,765$
Contributions as a percentage or covered-employee payroll21.47%
Notes to Schedule
Valuation date:October 1, 2012
ActuariallydeterminedcontributionratesarecalculatedasofOctober1,twoyearsprior
to the end of the fiscal year in which contributions are reported.
Methods and assumptions used to determine contribution rates:
Actuarial cost methodEntry age normal
Amortization methodLevel dollar, closed
Remaining amortization period20 years
Asset valuation method5-year smoothed market
Inflation3.00%
Salary increases6% including inflation
Investment rate of return7.5%
100% when first eligible for normal retirement or
Retirement age
DROP entry.
Thisscheduleispresentedasrequiredbyaccountingprinciplesgenerallyacceptedinthe
UnitedStatesofAmerica,however,untilafull10-yeartrendiscompiled,informationis
presented for those years available.
87
VILLAGE OF TEQUESTA, FLORIDA
REQUIRED SUPPLEMENTARY INFORMATION
POLICE OFFICERS' PENSION TRUST FUND
SCHEDULE OF INVESTMENT RETURNS
September 30,
2014
Annual money-weighted rate of return, net of investment expense7.46%
Thisscheduleispresentedasrequiredbyaccountingprinciplesgenerallyacceptedinthe
UnitedStatesofAmerica,however,untilafull10-yeartrendiscompiled,informationis
presented for those years available.
88
VILLAGE OF TEQUESTA, FLORIDA
REQUIRED SUPPLEMENTARY INFORMATION
POLICE OFFICERS' PENSION TRUST FUND
SCHEDULE OF FUNDING PROGRESS
ActuarialUAAL as a
ActuarialAccruedUnfundedPercentage
ActuarialValue ofLiabilityAALFundedCoveredof Covered
ValuationAssets(AAL)(UAAL)RatioPayrollPayroll
(ab)((b-a)c)
Date(a)(b)(b-a)(c)
October 1, 20093,965,053$ 4,471,106$ 506,053$ 88.7%1,434,855$ 35.3%
October 1, 20114,754,263 6,034,582 1,280,319 78.8%1,313,021 97.5%
October 1, 20125,291,259 6,708,023 1,416,764 78.9%1,427,247 99.3%
89
VILLAGE OF TEQUESTA, FLORIDA
REQUIRED SUPPLEMENTARY INFORMATION
SCHEDULE OF CHANGES IN THE VILLAGE'S NET PENSION LIABILITY AND
RELATED RATIOS
GENERAL EMPLOYEES' PENSION TRUST FUND
September 30,
2014
Total Pension Liability
Service cost278,029$
Interest216,124
Changes in benefit terms--
Differences between expected and actual experience--
Changes of assumptions--
Benefit payments(8,534)
Refunds(4,454)
Other (increase in state reserve)--
Net Change in Total Pension Liability
481,165
2,610,123
Total Pension Liability
- Beginning
$3,091,288
Total Pension Liability
- Ending (a)
Plan Fiduciary Net Position
Contributions - employer and state184,627$
Contributions - member100,560
Net Investment income308,314
Benefit payments(8,534)
Refunds(4,454)
Administrative expense(25,678)
Net Change in Plan Fiduciary Net Position
554,835
2,792,102
Plan Fiduciary Net Position
- Beginning
$3,346,937
Plan Fiduciary Net Position
- Ending (b)
$(255,649)
Net Pension Asset-
Ending (a) - (b)
Plan Fiduciary Net Position as a Percentage of the Total
Pension Liability (Asset)
108.27%
Covered Employee Payroll*
$2,011,200
Net Pension Liability (Asset) as a Percentage of
Covered-Employee Payroll
-12.71%
* Actual covered payroll for the fiscal year ending September 30, 2014
ThisscheduleispresentedasrequiredbyaccountingprinciplesgenerallyacceptedintheUnited
StatesofAmerica,however,untilafull10-yeartrendiscompiled,informationispresentedfor
those years available.
90
VILLAGE OF TEQUESTA, FLORIDA
REQUIRED SUPPLEMENTARY INFORMATION
SCHEDULE OF VILLAGE CONTRIBUTIONS
GENERAL EMPLOYEES' PENSION TRUST FUND
September 30,
2014
Actuarially determined contribution184,627$
Contributions in relation to the actuarially determined contribution184,627
Contribution deficiency (excess)--$
Covered-employee payroll2,011,200$
Contributions as a percentage or covered-employee payroll9.18%
Notes to Schedule
Valuation date:October 1, 2012
ActuariallydeterminedcontributionratesarecalculatedasofOctober1,twoyearsprior
to the end of the fiscal year in which contributions are reported.
Methods and assumptions used to determine contribution rates:
Actuarial cost methodAggregate
Amortization methodN/A
Remaining amortization periodN/A
Asset valuation method5-year smoothed market
Inflation4.00%
Salary increases6.0%, including inflation
Investment rate of return7.5%
100% when first eligible for normal retirement or
Retirement age
DROP entry
Thisscheduleispresentedasrequiredbyaccountingprinciplesgenerallyacceptedinthe
UnitedStatesofAmerica,however,untilafull10-yeartrendiscompiled,informationis
presented for those years available.
91
VILLAGE OF TEQUESTA, FLORIDA
REQUIRED SUPPLEMENTARY INFORMATION
GENERAL EMPLOYEES' PENSION TRUST FUND
SCHEDULE OF INVESTMENT RETURNS
September 30,
2014
Annual money-weighted rate of return, net of investment expense9.73%
Thisscheduleispresentedasrequiredbyaccountingprinciplesgenerallyacceptedinthe
UnitedStatesofAmerica,however,untilafull10-yeartrendiscompiled,informationis
presented for those years available.
92
VILLAGE OF TEQUESTA, FLORIDA
REQUIRED SUPPLEMENTARY INFORMATION
GENERAL EMPLOYEES' PENSION TRUST FUND
SCHEDULE OF FUNDING PROGRESS
ActuarialUAAL as a
ActuarialAccruedUnfundedPercentage
ActuarialValue ofLiabilityAALFundedCoveredof Covered
ValuationAssets(AAL)(UAAL)RatioPayrollPayroll
(ab)((b-a)c)
Date(a)(b)(b-a)(c)
October 1, 20091,465,279$ 1,341,518$ (123,761)$ 109.2%1,890,529$ -6.5%
October 1, 20101,716,448 1,625,288 (91,220) 105.6%1,858,451 -4.9%
October 1, 20111,965,445 1,921,731 (43,714) 102.3%1,902,093 -2.3%
October 1, 20122,287,726 2,306,175 18,449 99.2%1,994,337 0.9%
October 1, 20132,683,092 2,610,123 (72,969) 102.8%2,181,428 -3.3%
October 1, 20143,180,312 2,944,740 (235,572) 108.0%2,345,459 -10.0%
93
VILLAGE OF TEQUESTA, FLORIDA
REQUIRED SUPPLEMENTARY INFORMATION
SCHEDULE OF FUNDING PROGRESS - OTHER POST EMPLOYMENT BENEFITS
Unfunded
(a)Actuarial
ActuarialActuarialUnfundedAccrued
ActuarialValue ofAccruedActuarialFundedCoveredLiability as of
Valuation DateAssetsLiability (AAL)LiabilityRatioPayroll% of Covered
October 1, 2009--$ 484,000$ 484,000$ 0.0%4,111,000$ 11.8%
October 1, 2014-- 380,000 380,000 0.0%5,218,000 7.3%
Note: See Note 3.G Other post Employment Benefit (OPEB) Obligations
94
COMBINING AND INDIVIDUAL FUND
STATEMENTS AND SCHEDULES
NONMAJOR GOVERNMENTAL FUNDS
NONMAJOR GOVERNMENTAL FUNDS
Special Revenue Funds
Special revenue funds are used to account for specific revenue sources that are restricted,
committed, or assigned to expenditures for particular purposes.
Special Law Enforcement Trust Fund
– This fund accounts for forfeitures received by
the Police Department. Forfeitures obtained locally are expended as prescribed by
Florida Statute Chapter 932.704. Forfeitures obtained through federal programs are
expended according to the Department of Justice Asset Forfeiture Program.
Capital Projects Funds
Capital Projects Fundare used to account for and report financial resources that are
restricted, committed or assigned to expenditures for capital outlays including the
acquisition or construction of capital facilities and other capital assets. The use of the
capital projects fund type is permitted rather than mandated for financial reporting
purposes. Capital projects funds can be a valuable management tool for multi-year
projects.
Capital Improvement Fund
– This fund is used to account for the maintenance and
upkeep of the Village’s general infrastructure (such as roads, bridges, sidewalks and
storm water drainage systems) and streetscape beautification projects.
Capital Projects Fund
– This fund accounts for the acquisition or construction of major
capital projects, other than those financed by proprietary fund types.
VILLAGE OF TEQUESTA, FLORIDA
COMBINING BALANCE SHEET
NONMAJOR GOVERNMENTAL FUNDS
SEPTEMBER 30, 2014
Special RevenueTotalCapital Projects
Special LawCapital Capital Nonmajor
EnforcementImprovementProjectsGovernmental
FundFundFundFunds
Assets
Cash and cash equivalents272,689$ 5,412$ 4,314$ 282,415$
Inventories18,965 -- -- 18,965
Total Assets
5,412$ 4,314$ 301,380$
$291,654
Liabilities and Fund Balances
Liabilities
$ ----$ --$ --$
Fund Balances
Nonspendable:
Inventories18,965 -- -- 18,965
Restricted for:
Law enforcement272,689 -- -- 272,689
Assigned to:
5,412-- 4,314 9,726
Capital projects
Total Fund Balances
291,654 5,412 4,314 301,380
$291,654 5,412$ 4,314$ 301,380$
Total Liabilities and Fund Balances
95
VILLAGE OF TEQUESTA, FLORIDA
COMBINING STATEMENT OF REVENUES, EXPENDITURES AND CHARGES IN FUND
NONMAJOR GOVERNMENTAL FUNDS
FOR THE FISCAL YEAR ENDED SEPTEMBER 30, 2014
Special RevenueTotalCapital Projects
Special LawCapital Capital Nonmajor
EnforcementImprovementProjectsGovernmental
FundFundFundFunds
Revenues
Forfeitures/confiscations287,621$ --$ --$ 287,621$
Miscellaneous-- -- -- --
Investment earnings-- -- -- --
Total Revenues
--287,621 -- 287,621
Expenditures
Current:
Public Safety-- -- -- --
Transportation-- -- -- --
Total Expenditures
---- -- --
Excess of Revenues Over
Expenditures
--287,621 -- 287,621
Other Financing Uses
Transfers out-- (100,000) (50,000) (150,000)
Total Other Financing Uses
(100,000)-- (50,000) (150,000)
Net Change in Fund Balances
(100,000)287,621 (50,000) 137,621
105,4124,033 54,314 163,759
Fund Balances
- Beginning of Year
$ 5,412291,654$ 4,314$ 301,380$
Fund Balances
- End of Year
96
VILLAGE OF TEQUESTA, FLORIDA
BUDGETARY COMPARISON SCHEDULE
SPECIAL LAW ENFORCEMENT TRUST FUND
FOR THE FISCAL YEAR ENDED SEPTEMBER 30, 2014
Variance
with Final
Budget
Budgeted AmountsActual Positive
OriginalFinalAmounts(Negative)
Revenues
Forfeitures/Confiscations50,000$ 50,000$ 287,621$ 237,621$
Expenditures
Current:
1,000 -- (1,000)
Public Safety1,000
Excess of Revenues Over
Expenditures
49,000 49,000 287,621 238,621
Other Financing Uses
Transfers out(50,000) (50,000) -- 50,000
Net Change in Fund Balance
(1,000)(1,000) 287,621 288,621
29,775 29,775 4,033 --
Fund Balance
- Beginning
$28,775 28,775$ 291,654$ 262,879$
Fund Balance
- Ending
97
VILLAGE OF TEQUESTA, FLORIDA
BUDGETARY COMPARISON SCHEDULE
CAPITAL IMPROVEMENT FUND
FOR THE FISCAL YEAR ENDED SEPTEMBER 30, 2014
Variance
with Final
Budget
Budgeted AmountsActual Positive
OriginalFinalAmounts(Negative)
Revenues
$-- --$ --$ --$
Exenditures
p
-- -- -- --
Excess (deficiency) of revenues over
(under) expenditures
---- -- --
Other Financing Sources (Uses)
Transfers out(100,000) (100,000) (100,000) --
Net Change in Fund Balance
(100,000)(100,000) (100,000) --
105,412105,412 105,412 --
Fund Balance
- Beginning
$ 5,4125,412$ 5,412$ --$
Fund Balance
- Ending
98
VILLAGE OF TEQUESTA, FLORIDA
BUDGETARY COMPARISON SCHEDULE
CAPITAL PROJECTS FUND
FOR THE FISCAL YEAR ENDED SEPTEMBER 30, 2014
Variance
with Final
Budget
Budgeted AmountsActual Positive
OriginalFinalAmounts(Negative)
Revenues
$ ----$ --$ --$
Expenditures
---- ----
Transportation
---- ----
Total Expenditures
Excess (deficiency) of revenues over
(under) expenditures
---- -- --
Other Financing Uses
Transfers out(50,000)(50,000) --(50,000)
Net Change in Fund Balance
(50,000)(50,000) (50,000) --
54,31454,314 --54,314
Fund Balance
- Beginning
$4,314$4,314$ --4,314$
Fund Balance
- Ending
99
FIDUCIARY FUNDS
FIDUCIARY FUNDS
Fiduciary funds are used to report assets held in a trustee or agency capacity for others
and therefore cannot be used to support the government’s own programs. Pension trust
funds are fiduciary funds that are used to report resources required to be held in trust for
the members and beneficiaries of defined benefit pension plans, defined contribution
plans, other postemployment benefit plans, or other employee benefit plans. The Village
accounts for two defined benefit plans (Public Safety reports separate trust funds for
Police Officers and Firefighters) and a separate fund is reported for each individual trust
fund. The three trust funds are as follows:
Firefighters’ Pension Trust Fund
– This fund accounts for the accumulation of
resources and for contributions and benefits of the firefighter employees.
Police Officers’ Pension Trust Fund
– This fund accounts for the accumulation of
resources and for contributions and benefits of the police employees hired prior to
February 1, 2013.
General Employees’ Pension Trust Fund
– This fund accounts for the accumulation of
resources and for contributions and benefits for the general employees of the Village.
VILLAGE OF TEQUESTA, FLORIDA
COMBINING STATEMENT OF FIDUCIARY NET POSITION
SEPTEMBER 30, 2014
Police General
Firefighters'Officers'Employees'
PensionPensionPension
Trust FundTrust FundTrust FundTotal
Assets
122,846$ 103,053$ 531,777$
Cash and cash equivalents305,878$
Investments, at fair value:
Corporate stocks1,994,179 793,042 1,841,867 4,629,088
Corporate bonds-- -- 394,159 394,159
Government backed securities-- -- 407,241 407,241
Mutual Funds5,421,767 2,156,120 591,875 8,169,762
2,949,162 3,235,142 13,600,250
Total investment, at fair value7,415,946
Prepaid items1,678 1,678 1,032 4,388
Contributions receivable110,087 2,522 8,154 120,763
1,563 10,482 16,752
Accrued interest receivable4,707
Total Assets
3,077,771 3,357,863 14,273,930
7,838,296
Liabilities
Accounts payable9,526 9,011 10,437 28,974
Due to broker4,567 1,816 489 6,872
10,82714,093 10,926 35,846
Total Liabilities
Net Position Restricted for
Pension Benefits
$ 3,066,9447,824,203$ 3,346,937$ 14,238,084$
100
VILLAGE OF TEQUESTA, FLORIDA
COMBINING STATEMENT OF CHANGES IN FIDUCIARY NET POSITION
FOR THE FISCAL YEAR ENDED SEPTEMBER 30, 2014
Police General
Firefighters'Officers'Employees'
PensionPensionPension
Trust FundTrust FundTrust FundTotal
Additions
Contributions:
Employer (including State)452,269$ 111,164$ 184,627$ 748,060$
Employee65,803 25,888 100,560 192,251
Total Contributions
137,052 285,187 940,311
518,072
Investment earnings
Net increase in fair value of
investments395,708 161,015 175,071 731,794
Gain on sale of investments65,448 26,027 85,295 176,770
Interest earnings128,545 52,006 78,268 258,819
Total investment earnings589,701 239,048 338,634 1,167,383
(19,829) (30,320) (72,064)
Less investment expenses(21,915)
Net investment earnings567,786 219,219 308,314 1,095,319
Total Additions1,085,858 356,271 593,501 2,035,630
Deductions
Benefits paid53,637 10,073 8,534 72,244
Refunds of contributions-- 43,331 4,454 47,785
Administrative expenses18,921 18,677 25,678 63,276
72,081 38,666 183,305
72,558
Total Deductions
Net Increase
284,1901,013,300 554,835 1,852,325
Net Position Restricted for
Pension Benefits
2,782,7546,810,903 2,792,102 12,385,759
Beginning
3,066,944$ 3,346,937$ 14,238,084$
$7,824,203
Ending
101
STATISTICAL SECTION
STATISTICAL SECTION
This part of the Village of Tequesta's Comprehensive Annual Financial Report presents detailed
information as a context for understanding what the information in the financial statements, note
disclosures, and required supplementary information says about the Village's overall financial
health.
ContentsPage
Financial Trends
Theseschedulescontaintrendinformationtohelpthereaderunderstandhowthe
102-106
Village's financial performance and well-being have changed over time.
Revenue Capacity
TheseschedulescontaininformationtohelpthereaderassesstheVillage'smost
107-110
significant local revenue source, the property tax.
Debt Capacity
Theseschedulespresentinformationtohelpthereaderassesstheaffordabilityofthe
Village'scurrentlevelsofoutstandingdebtandtheTown'sabilitytoissueadditional
111-115
debt in the future.
Demographic and Economic Information
Theseschedulesofferdemographicandeconomicindicatorstohelpthereader
116-117
understand the environment within which the Village's financial activities take place.
Operating Information
Theseschedulescontainserviceandinfrastructuredatatohelpthereaderunderstand
howtheinformationintheVillage'sfinancialreportrelatestotheservicestheVillage
118-120
provides and the activities it performs.
Sources:
Unlessotherwisenoted,theinformationintheseschedulesisderivedfrom
the Comprehensive Annual Financial Reports for the relevant year.
109
CURRENT YEAR AND NINE YEARS AGO
PRINCIPAL PROPERTY TAXPAYERS
110
PROPERTY TAX LEVIES AND COLLECTIONS
LAST TEN FISCAL YEARS
116
DEMOGRAPHIC AND ECONOMIC STATISTICS
LAST TEN FISCAL YEARS
Per
VILLAGE OF TEQUESTA, FLORIDA
PRINCIPAL EMPLOYERS - PALM BEACH COUNTY
CURRENT YEAR AND NINE YEARS AGO
20132005
Percentage of Percentage of
Total County Total County
EmployerEmployeesRankEmploymentEmployeesRankEmployment
School Board of Palm Beach County21,449 13.55%21,618 13.72%
Palm Beach County11,010 21.82%10,432 21.80%
Tenet Healthcare Corporation 6,100 31.01%5,000 30.86%
Florida Power & Light (Headquarters)3,804 40.50%2,924 50.50%
G4S (Headquarters)3,000 50.63%
Florida Atlantic University2,980 60.49%
Hospital Corporation of America (HCA) 2,714 70.45%
Veterans Health Administration2,700 80.45%
Bethesda Memorial Hospital2,643 90.44%
Boca Raton Regional Hospital2,250 100.37%
Columbia PB Healthcare System3,750 40.65%
Office Depot (Headquarters)2,680 60.46%
Boca Raton Resort & Club2,200 70.38%
U.S. Sugar Corporation 2,100 80.36%
Florida Crystals 90.34%2,000
City of Boca Raton1,991 100.34%
9.71%54,69558,650 9.41%
Source:Business Development Board of Palm Beach County
Employment information for the Town is not available
Notes:2014 numbers were not available at time of publication
117
VILLAGE OF TEQUESTA, FLORIDA
OPERATING INDICATORS BY FUNCTION/PROGRAM
LAST NINE FISCAL YEARS
200620072008200920102011201220132014
Governmental Activitie
s
General governmen
t
Registered voter 4,0074,007 4,439 4,612 4,505 4,543 4,676 4,854 4,702
s
Public safety:
No. of full-time certified police officer 1916 17 18 17 19 11 *18 20
s
No. of calls receive 3,5003,300 3,535 3,533 3,178 3,266 3,5483,571
d
3,272
No. of arrests199 238 224 251 296 204 129 136 168
No. of parking violation 148162 171 131 124 82 149 328 120
s
No. of incident numbers issue 853817 965 887 881 595 622 691 725
d
Fire department
:
No. of full-time certified firefighter 1916 20 21 21 22 21 21 18
s
No. of emergency response 1,1221,254 1,143 1,189 1,043 1,096 1,155 1,372 1,197
s
No. of transports622 521 621 651 562 622 695 675 693
No. of fires extinguished/alarm 601632 522 538 481 474 460 697 504
s
No. of inspections326 412 435 476 480 462 495 539 713
Building, zoning:
No. of building permits issue 9981,049 906 784 812 800 883 914 929
d
No. of building inspections conducte 2,5812,214 2,039 1,771 1,579 1,728 1,931 2,176 2,201
d
Leisure services
:
No. of Spring Classes-- -- 8 8 10 10 10 10 8
No. of Summer Classes-- -- 4 5 4 4 4 4 4
No. of Movies-- -- 4 4 3 3 3 3 4
Business-Tpe Activities
y
Water:
No. of customers4,612 4,722 4,968 4,983 4,982 5,019 4,996 5,037 5,039
Average daily consumptio2.782 mg2.349 mg2.351 mg2.175 mg2.175 mg2.698 mg2.550 mg2.454 mg2.422 mg
n
Sources: Various Village department
s
Note: The Village began to report this information in fiscal year 2006, as prior information is not available
* The number is much lower than the year before due to increased number of reserve officers to cover for the full-time officers
that left the department during the FY 2012.
119
VILLAGE OF TEQUESTA, FLORIDA
CAPITAL ASSET STATISTICS BY FUNCTION/PROGRAM
LAST NINE FISCAL YEARS
Function/Program200620072008200920102011201220132014
Governmental Activities
General government:
Municipal center0011 1 1 1 11
Public safety
Police:
No. of stations1111 1 11 11
No. of patrol units121279 15 1511 1011
Fire:
No. of stations1111 1 11 11
No. of ambulances2222 3 33 33
No. of pumpers3322 3 33 33
Transportation:
Miles of street lane miles484343*2424 2424 2424
No. of bridges11 1 1111 11
Leisure services
No. of parks3334 4 55 5 6 **
No. of park acreage48484850 53 5454 54 62 **
No. of playgrounds3322 2 2222
No. of baseball/softball diamonds 3333 3 3333
No. of skate-parks1111 1 1111
Business-type activities:
Water:
Miles of water mains50757272 73 72727373
No. of fire hydrants550430430430 430 430430433409
Storage capacity
(thousands of gallons)3,250 3,250 3,250 3,250 3,250 3,250 3,250 2,7502,750
Sources: Various Village departments
Note: The Village began to report this information in fiscal year 2006, as prior information is not available.
* This report is presenting the revised method in calculating the miles of street lane
** The green area has been identified as a park (Linear/Green Mile park)
120
REPORTING SECTION
INDEPENDENT AUDITORS' REPORT ON INTERNAL CONTROL OVER
FINANCIAL REPORTING AND ON COMPLIANCE AND OTHER MATTERS
BASED ON AN AUDIT OF FINANCIAL STATEMENTS PERFORMED
IN ACCORDANCE WITH
GOVERNMENT AUDITING STANDARDS
To the Honorable Mayor, Village Council and Village Manager
Village of Tequesta, Florida
We have audited, in accordance with the 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, the financial
statementsof the governmental activities, the business-type activities, each major fund, and the
aggregate remaining fund information of the Village of Tequesta (the Village), as of and for the
fiscal year ended September 30, 2014 and the related notes to the financial statements, which
collectively comprise the Village’s basic financial statements, and have issued our report
thereon dated May 1, 2015.
Internal Control over Financial Reporting
In planning and performing our audit of the financial statements, we considered the Village’s
internal control over financial reporting (internal control) to determine the audit procedures that
are appropriate in the circumstances for the purpose of expressing our opinions on the financial
statements, but not for the purpose of expressing an opinion on the effectiveness of the Village’s
internal control. Accordingly, we do not express an opinion on the effectiveness of the Village’s
internal control.
Adeficiency in internal control exists when the design or operation of a control does not allow
management or employees, in the normal course of performing their assigned functions, to
prevent, or detect and correct, misstatements on a timely basis. A material weakness is a
deficiency, or a combination of deficiencies, in internal control, such that there is a reasonable
possibility that a material misstatement of the entity’s financial statements will not be prevented,
or detected and corrected on a timely basis. A significant deficiency is a deficiency, or a
combination of deficiencies, in internal control that is less severe than a material weakness, yet
important enough to merit attention by those charged with governance.
Our consideration of internal control was for the limited purpose described in the first paragraph
of this section and was not designed to identify all deficiencies in internal control that might be
material weaknesses or significant deficiencies. Given these limitations, during our audit we did
not identify any deficiencies in internal control that we consider to be material weaknesses.
However, material weaknesses may exist that have not been identified.
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Compliance and Other Matters
As part of obtaining reasonable assurance about whether the Village’s financial statements are
free from material misstatement, we performed tests of its compliance with certain provisions of
laws, regulations, contracts, and grant agreements, noncompliance with which could have a
direct and material effect on the determination of financial statement amounts. However,
providing an opinion on compliance with those provisions was not an objective of our audit, and
accordingly, we do not express such an opinion. The results of our tests disclosed no instances of
noncompliance or other matters that are required to be reported under Government Auditing
Standards.
Purpose of this Report
The purpose of this report is solely to describe the scope of our testing of internal control and
compliance and the results of that testing, and not to provide an opinion on the effectiveness of
the Village’s internal control or on compliance. This report is an integral part of an audit
performed in accordance with Government Auditing Standards in considering the entity’s
internal control and compliance. Accordingly, this communication is not suitable for any other
purpose.
West Palm Beach, FL
May 1, 2015
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MANAGEMENT LETTER IN ACCORDANCE WITH THE RULES OF THE
AUDITOR GENERAL OF THE STATE OF FLORIDA
To The Honorable Mayor, Village Council and Village Manager
Village of Tequesta, Florida
Report on the Financial Statements
We have audited the financial statements of the Village of Tequesta, Florida (the Village), as of
and for the fiscal year ended September 30, 2014, and have issued our report thereon dated May
1, 2015.
Auditors’ Responsibility
We conducted our audit in accordance with auditing standards generally accepted in the United
States of America; the standards applicable to financial audits contained in Government Auditing
Standards,issued by the Comptroller General of the United States; and Chapter 10.550, Rules of
the Auditor General.
Other Reports
We have issued our Independent Auditors’ Report on Internal Control over Financial Reporting
and Compliance and Other Matters Based on an Audit of the Financial Statements Performed in
Accordance with Government Auditing Standards and Independent Accountants’ Report on an
examination conducted in accordance with AICPA Professional Standards, Section 601,
regarding compliance requirements in accordance with Chapter 10.550, Rules of the Auditor
General. Disclosures in those reports, which are dated May 1, 2015, should be considered in
conjunction with this management letter.
Prior Audit Findings
Section 10.554(1)(i)1., Rules of the Auditor General, requires that we determine whether or not
corrective actions have been taken to address findings and recommendations made in the
preceding annual financial audit report. There were no recommendations made in the preceding
annual financial audit report.
Official Title and Legal Authority
Section 10.554(1)(i)4., Rules of the Auditor General, requires that the name or official title and
legal authority for the primary government and each component unit of the reporting entity be
disclosed in this management letter, unless disclosed in the notes to the financial statements. The
Village was incorporated in 1957 by laws of Florida 57-1915. There are no component units
related to the Village.
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Financial Condition
Section 10.554(1)(i)5.a., Rules of the Auditor General, requires that we report the results of our
determination as to whether or not the Council has met one or more of the conditions described
in Section 218.503(1), Florida Statutes, and identification of the specific condition(s) met. In
connection with our audit, we determined that the Village did not meet any of the conditions
described in Section 218.503(1), Florida Statutes.
Pursuant to Sections 10.554(1)(i)5.c. and 10.556(8), Rules of the Auditor General, we applied
financial condition assessment procedures. It is management’s responsibility to monitor the
Village’s financial condition, and our financial condition assessment was based in part on
representations made by management and the review of financial information provided by same.
This assessment was done as of the fiscal year ended September 30, 2014.
Annual Financial Report
Section 10.554(1)(i)5.b., Rules of the Auditor General, requires that we report the results of our
determination as to whether the annual financial report for the Councilfor the year ended
September 30, 2014, filed with the Florida Department of Financial Services pursuant to Section
218.32(1)(a), Florida Statutes, is in agreement with the annual financial audit report for the fiscal
year ended September 30, 2014. In connection with our audit, we determined that these two
reports were in agreement.
Other Matters
Section 10.554(1)(i)2., Rules of the Auditor General, requires that we address in the management
letter any recommendations to improve financial management. In connection with our audit, we
.
did not have any such recommendations
Section 10.554(1)(i)3., Rules of the Auditor General, requires that we address noncompliance
with provisions of contracts or grant agreements, or abuse, that have occurred, or are likely to
have occurred, that have an effect on the financial statements that is less than material but which
warrants the attention of those charged with governance. In connection with our audit, we did not
have any such findings.
Purpose of this Letter
Our management letter is intended solely for the information and use of the Legislative Auditing
Committee, members of the Florida Senate and the Florida House of Representatives, the Florida
Auditor General, Federal and other granting agencies, Village Council, and management, and is
not intended to be and should not be used by anyone other than these specified parties.
West Palm Beach, FL
May 1, 2015
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INDEPENDENT ACCOUNTANTS’ REPORT ON COMPLIANCE PURSUANT TO
SECTION 218.415 FLORIDA STATUTES
To The Honorable Mayor, Village Council and Village Manager
Village of Tequesta, Florida
We have examined the Village of Tequesta’s (the Village) compliance with Section 218.415
Florida Statutes for the fiscal year ended September 30, 2014. Management is responsible for the
Village’s compliance with those requirements. Our responsibility is to express an opinion on the
Village’s compliance based on our examination.
Our examination was conducted in accordance with attestation standards established by the
American Institute of Certified Public Accountants and, accordingly, included examining, on a
test basis, evidence about the Village’s compliance with those requirements and performing such
other procedures as we considered necessary in the circumstances. We believe that our
examination provides a reasonable basis for our opinion. Our examination does not provide a
legal determination on the Village’s compliance with specified requirements.
In our opinion, the Village complied, in all material respects, with the aforementioned
requirements for the fiscal year ended September 30, 2014.
This report is intended solely for the information and use of management, Village Council,
others within the Village and the Auditor General of the State of Florida and is not intended to be
and should not be used by anyone other than these specified parties.
West Palm Beach, FL
May 1, 2015
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