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CAFR_FY Ending_9/30/2023 f' VILLA GE OF TEQ UES TA, FL ORIDA Annual 1 1 11 <•ll Comprehensive Financial Report +.-71..-.�,�,,. 4, -t._ _ '"� ram. _'a„� .�`�'� _T�`•.� .. ram. y+ � +.,:w.�• � - r ,r AN Fiscal Year Ended September 30, 2023 vim..� i.+..��-�" �s�*. �►• -.rf-�' ��(�' " -.�'T, ..�: '�� . -"��•.`_�A :��'fir ,f f'n ,C i i fi f � 2023 Village of Tequesta Council L to R: Council Member Rick Sartory, Council Member Frank D'Ambra III, Mayor Molly Young, Vice-Mayor Laurie Brandon, Council Member Patrick Painter VILLAGE OF TEQUESTA, FLORIDA ANNUAL COMPREHENSIVE FINANCIAL REPORT FOR THE FISCAL YEAR ENDED SEPTEMBER 30,2023 Prepared By Finance Department The Village of Tequesta,Florida VILLAGE OF TEQUESTA, FLORIDA TABLE OF CONTENTS I. INTRODUCTORY SECTION Letter of Transmittal i Certificate of Achievement for Excellence in Financial Reporting vi Organization Chart vii List of Principal Officials viii 11. FINANCIAL SECTION INDEPENDENT AUDITORS' REPORT 1 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 Reconciliation of the Balance Sheet of Governmental Funds to the Statement of Net Position 21 Statement of Revenues,Expenditures and Changes in Fund Balances— Governmental Funds 22 Reconciliation of the Statement of Revenues,Expenditures and Changes in Fund Balances of Governmental Funds to the Statement of Activities 23 Statement of Net Position—Proprietary Funds 24 Statement of Revenues,Expenses and Changes in Net Position—Proprietary Funds 25 Statement of Cash Flows Proprietary Funds 26 Statement of Fiduciary Net Position—Fiduciary Funds 27 Statement of Changes in Fiduciary Net Position—Fiduciary Funds 28 Notes to Basic Financial Statements 29-93 REQUIRED SUPPLEMENTARY INFORMATION Budgetary Comparison Schedule—General Fund 94 Note to the Budgetary Comparison Schedule 95 Firefighters' Pension Trust Fund Schedule of Changes in the Village's Net Pension Liability and Related Ratios 96 Schedule of Village Contributions 97 Schedule of Investment Returns 98 Police Officers'Pension Trust Fund Schedule of Changes in the Village's Net Pension Asset and Related Ratios 99 Schedule of Village Contributions 100 Schedule of Investment Returns 101 General Employees' Pension Trust Fund Schedule of Changes in the Village's Net Pension Liability(Asset)and Related Ratios 102 Schedule of Village Contributions 103 Schedule of Investment Returns 104 Schedule of Changes in Total OPEB Liability and Related Ratios 105 Schedule of Village's Proportionate Share of the Net Pension Liability— Florida Retirement System Pension 106 Schedule of the Village's Proportionate Share of the Net Pension Liability— Retiree Health Insurance Subsidiary Program 107 Schedule of the Village's Contributions Florida Retirement System Pension Plan 108 Schedule of the Village's Contributions Retiree Health Insurance Subsidy Program 109 VILLAGE OF TEQUESTA, FLORIDA TABLE OF CONTENTS 11. FINANCIAL SECTION(CONTINUED) SUPPLEMENTARY INFORMATION Combining and Individual Fund Statements and Schedules Combining Balance Sheet—Nonmajor Governmental Funds 110 Combining Statement of Revenues,Expenditures and Changes in Fund Balances— Nonmajor Governmental Funds III Budgetary Comparison Schedule—Building Fund 112 Budgetary Comparison Schedule—Special Law Enforcement Trust Fund 113 Budgetary Comparison Schedule—Capital Improvement Fund 114 Budgetary Comparison Schedule—Capital Projects Fund 115 Combining Statement of Fiduciary Net Position 116 Combining Statement of Changes in Fiduciary Net Position 117 111. STATISTICAL SECTION Net Position by Component 118 Changes in Net Position 119 Fund Balances, Governmental Funds 121 Changes in Fund Balances, Governmental Funds 122 Assessed and Estimated Actual Value of Taxable Property 123 Property Tax Rates—All Direct and Overlapping Governments 124 Principal Property Taxpayers 125 Property Tax Levies and Collections 126 Ratios of Outstanding Debt by Type 127 Ratio of Net Outstanding Debt to Assessed Value and Net Bonded Debt Per Capita 128 Computation of Legal Debt Margin 129 Direct and Overlapping Governmental Activities Debt 130 Demographic and Economic Statistics 131 Principal Employers—Palm Beach County 132 Full-time-Equivalent Village Government Employees by Function/Program 133 Operating Indicators by Function/Program 134 Capital Asset Statistics by Function/Program 135 IV. REPORTING SECTION Independent Auditor's Report on Internal Control over Financial Reporting and on Compliance and Other Matters based on an Audit of Financial Statements Performed in Accordance with Government Auditing Standards 136 Schedule of Findings and Responses 138 Management Letter in Accordance with the Rules of the Auditor General of the State of Florida 140 Independent Accountant's Report On Compliance Pursuant To Section 218.415 Florida Statutes 142 INTRODUCTORY SECTION Village of Tequesta 345 Tequesta Drive 561-75$-0700 Tequesta, FL 33469 www.tequesta.org q March 11, 2024 To the Honorable Mayor, Members of the Village Council And Citizens of the Village of Tequesta, Florida We are pleased to submit the Annual Comprehensive Financial Report of the Village of Tequesta, Florida(the Village),for the fiscal year ended September 30, 2023. This report provides the Village's Council, staff, our citizens, and other interested parties with detailed information concerning the financial condition and activities of the Village government. State law requires that all general-purpose local governments annually publish a complete set of financial statements within nine months of the close of each fiscal year. The financial statements are presented in conformity with generally accepted accounting principles (GAAP) and audited in accordance with generally accepted auditing standards and government auditing standards by an independent auditing firm. We believe that this report complies with these requirements and continues to present the Village's strong tradition of full financial disclosure. This philosophy is reflected by the informative financial analysis, the exhibits and statistical tables included herein. The role of the Annual Comprehensive Financial Report is to assist in making economic, social and political decisions and to assist in assessing accountability to the citizenry by: • Comparing actual financial results with the legally adopted budget,where appropriate; • Assessing financial condition and results of operations; • Assisting in determining compliance with finance related laws, rules and regulations; and • Assisting in evaluating the efficiency and effectiveness of Village operations. Responsibility for both the accuracy of the presented data and the completeness and fairness of the presentation, including all disclosures, rests with the management of the Village. We believe the data, as presented, is accurate in all material respects; that it is presented in a manner designed to present fairly the financial position and results of operations of the Village; and that all disclosures necessary to enable the reader to gain an understanding of the Village's financial activity have been included. Mauldin & Jenkins, Certified Public Accountants, have issued an unmodified ("clean") opinion on the Village of Tequesta's financial statements for the fiscal year ended September 30, 2023. 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. i THE VILLAGE OF TEQUESTA Prof ile The Village of Tequesta, Florida is a municipal corporation organized on 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. The Village'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 statute 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 manager,who is responsible for hiring all Village employees. Services Provided The Village provides a full range of services, including police and fire protection; building inspections; planning; licenses and permits; the construction and maintenance of streets and other infrastructure, recreational and cultural activities, water utility services, storm water operations and contracts for residential refuse and recycling services. Accounting and Internal Control Management of the Village is responsible for establishing and maintaining an internal control structure designed to ensure that the assets of the Village are protected from loss,theft or misuse and to ensure that adequate accounting data is compiled to allow for the preparation of financial statements in conformity with accounting principles generally accepted in the United States of America. The internal control structure is designed to provide reasonable, but not absolute, assurance that these objectives are met. The ii concept of reasonable assurance recognizes that: (1) the cost of a control should not exceed the benefits likely to be derived; and (2) the valuation of costs and benefits requires estimates and judgments by management. Single Audit As a recipient of federal, state and county financial assistance, the Village is also responsible for ensuring that an adequate internal control structure is in place to ensure compliance with applicable laws and regulations related to those programs. The Village was not subject to an audit in accordance with the Uniform Guidance or the Florida Single Audit Act for the fiscal year ended September 30, 2023 under the provisions of the U.S. Office of Management and Budget Compliance Supplement (Uniform Guidance) and the Rules of the Auditor General, State of Florida. Budgetary Controls The Council is required to adopt an initial budget prior to the beginning of the fiscal year October 1. In accordance with state laws the Approved Budget is posted on the Village's website within 30 days of adoption. This annual budget serves as the foundation for the Village of Tequesta's financial planning and control. The objective of these budgetary controls is to ensure compliance with legal provisions embodied in the annual appropriated budget approved by the Village's governing body. Activities of the General Fund, Special Revenue Funds, and Capital Project Funds are included in the annual appropriated budget. The budget is prepared by fund,function (e.g.,public safety), and department(e.g.,police) and is adopted by fund total. Department Directors may transfer resources within a department with the approval of the Village Manager. Transfers between funds or exceeding the amounts appropriated in any fund require budget amendments be approved by the Village Council. The legal level of budgetary control is therefore at the fund level. Local Economy The Village, located in the north end of Palm Beach County, which is the third most populous county in the State of Florida (approximately 1.5 million residents). The latest population estimate prepared by the Bureau of Economic and Business Research, University of Florida indicates that the current population of the Village of Tequesta is 6,179. Tequesta is home to middle to upper-income suburban families; has a small commercial area and no major industries located within its boundaries. It is home to a number of assisted living facilities,private schools and a high-end treatment center. The unemployment rate in the United States was 3.8% as of September 2023 and 3.5% just one year earlier. This compares to the Florida's unemployment rate was 2.8% as of September 2023 and 2.5%just one year earlier. Palm Beach County's unemployment rate was 3.3%as of September 2023 and 2.6%just one year earlier. The future continues to look good for the Village of Tequesta. The entire country is feeling the effects of significant and prolonged inflation. The CPI increased 3.6% from September 2022 to 2023 and the corresponding increase from September 2021 to 2022 was 8.2% which is remains higher than the feds goal of keeping inflation around 2%. The housing market is slowing as the fed works to reduce the high inflation levels. That resulted in federal funds rates increasing to 5.25%to 5.50% (highest since January 2001) and pushed mortgage rates much higher 6.5% to 7.3%. Housing starts are decreasing (-7.2% in Florida for September 2023 when compared to September 2022, according to the Florida Realtors) Tequesta continues to see rising property values. Per the Palm Beach County Property Appraiser's Office, gross taxable value for calculating ad valorem proceeds increased from $1.295 billion during calendar year 2022 to $1.489 billion during calendar year 2023 revenues. Construction projects in the Village are anticipated to add approximately 15%to the gross taxable value. in Strategic Plan The Village of Tequesta Village Council continue to utilize strategic planning to guide the future of the Village. The Strategic plan identifies the four main goals along with strategic objectives and actions to support overall goals: • Maintain level of services at the intended level of Operational Excellence. • Update infrastructure. • Maintain and enhance the distinctive character and culture of the Village. • Maintain and strengthen the financial stability of the Village. The Village Council adopted the following vision for the future: We will preserve and enhance the unique character, community spirit, small town values, and superior quality of life for all who reside, visit, and work in the Village of Tequesta. The Village Council's adopted mission: The Village of Tequesta's mission is to protect the health, safety, and well-being of the community, provide exception, fiscally sound, and efficient customer service, uphold the public interest and advance the community vision. The Village Council added two new values as part of this year's strategic planning meeting: • Excellence. • Ethics &Transparency. • Quality of Life. • Employees. • Communication. • Compassion. Long-Term Financial Planning and Major Initiatives The continued goal of the Village is to 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 have come to expect. It is the result of hard work by the Village staff, and fiscally sound, responsible decisions by the Village Council that allows 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 perhaps most 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. The Village's primary focus is providing exceptional municipal services to its residents in the most efficient and cost effective 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 continues to explore grant funding opportunities and partnerships in an effort to control cost while improving services and equipment. iv MAJOR INITIATIVES • Continue to explore alternative revenue sources, at both the state and federal level, with the assistance of grant writers and other professional consultant services. • Building of Remembrance Park to maintain and enhance the distinctive character and culture of the Village. • Strengthen our relationships with local businesses to recruit and retain businesses in the Village. • Continue and enhance the annual street and sidewalk maintenance program. • Continue upgrades to the Water Treatment Plant,which includes energy conservation projects,to provide safe, reliable, cost-effective and environmentally responsible potable water. • Maintain a reliable drinking water supply by rehabilitating upper Floridian aquifer wells and construct a new surficial well. • To advance a long-range plan for the replacement of the aging water distribution system. AWARDS AND ACKNOWLEDGEMENTS The Government Finance Officers Association (GFOA) awarded a Certificate of Achievement for Excellence in Financial Reporting to the Village for its annual comprehensive financial report for the fiscal year ended September 30, 2022. The Village has received this prestigious award for forty one consecutive years. The Village must publish an easily readable and efficiently organized annual comprehensive 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 annual comprehensive 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. We would like to thank the staff of the Finance Department for their efforts in preparing this report and all Village departments for their cooperation and assistance throughout the past year. Special appreciation is also extended to Ms. Tatiana Racanati, Assistant Finance Director, whose dedicated service made the completion of this report all the more possible. We also want to thank the Mayor and Village Council for providing leadership and taking necessary actions to continue a standard of financial excellence for the Village. Respectfully submitted, Jeremy Allen, ICMA-CM Jeff Snyder, CPA, CGMA Village Manager Finance Director v Government Finance Officers Association Certificate of Achievement for Excellence in Financial Reporting Presented to Village of Tequesta Florida For its Annual Comprehensive Financial Report For the Fiscal Year Ended September 30, 2022 � P Executive Director/CEO vl VILLAGE OF TEQUESTA, FLORIDA ORGANIZATION CHART SEPTEMBER 30, 2023 Residents of Tecluesta Vi Ilagc council Village Manager Village Attorney Executiveflsslstant Departments Human Resources Allagederk haanrcie Genera I Government Community Building DEvelopment Refuse&Recyding IT Code Enforcement Police Department Fire Rescue/EMS F—P-blir.Works leisure Services 14zt-rr Water UtllltySysrtem Utlllty Vll VILLAGE OF TEQUESTA, FLORIDA LIST OF PRINCIPAL OFFICIALS SEPTEMBER 30,2023 VILLAGE COUNCIL Molly Young Mayor Laurie Brandon Vice-Mayor Frank D'Ambra, III Council member Patrick Painter Council member Rick Sartory Council member VILLAGE OFFICIALS Jeremy Allen, ICMA-CM Village Manager Davis &Associates, PA Village Attorney Lori McWilliams, MMC Village Clerk Jeffery Snyder, CPA, CGMA Finance Director Jim Trube Fire Chief Gus Medina Police Chief Merlene Reid, Ed.D., SPHR Human Resources Director Jeremy Hubsch Community Development Director Wayne Cameron Building Director Greg Corbitt Parks and Recreation Director Marjorie Craig,PE Utilities Director VILLAGE INDEPENDENT AUDITORS Mauldin&Jenkins, LLC viii f s m i. f FINANCIAL SECTION ru+ INDEPENDENT AUDITORS' REPORT A T MAULDIN&JENKINS CPAs & ADVISORS INDEPENDENT AUDITOR'S REPORT To the Honorable Mayor,Village Council and Village Manager Village of Tequesta,Florida Report on the Financial Statements Opinions 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 year ended September 30, 2023, and the related notes to the financial statements, which collectively comprise the Village's basic financial statements as listed in the table of contents. 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, as of September 30, 2023, and the respective changes in financial position, and,where applicable, cash flows thereof for the year then ended in accordance with accounting principles generally accepted in the United States of America. Basis for Opinions 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. Our responsibilities under those standards are further described in the Auditor's Responsibilities for the Audit of the Financial Statements section of our report. We are required to be independent of the Village and to meet our other ethical responsibilities, in accordance with the relevant ethical requirements relating to our audit. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinions. Responsibilities of Managementfor the Financial Statements Management is responsible for the preparation and fair presentation of the financial statements in accordance with accounting principles generally accepted in the United States of America, and for 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. In preparing the financial statements, management is required to evaluate whether there are conditions or events, considered in the aggregate,that raise substantial doubt about the Village's ability to continue as a going concern for 12 months beyond the financial statement date,including any currently known information that may raise substantial doubt shortly thereafter. 1401 MANATEE AVENUE WEST,SUITE 1200•BRADENTON,FLORIDA 34205•941-747-4483•FAX 941-747-6035•www.mjcpa.com MEMBERS OF THE AMERICANINSTITUTE OF CERTIFIED PUBLIC ACCOUNTANTS Auditor's Responsibilities for the Audit of the Financial Statements Our objectives are to obtain reasonable assurance about whether the financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an auditor's report that includes our opinions. Reasonable assurance is a high level of assurance but is not absolute assurance and therefore is not a guarantee that an audit conducted in accordance with generally accepted auditing standards and Government Auditing Standards will always detect a material misstatement when it exists. The risk of not detecting a material misstatement resulting from fraud is higher than for one resulting from error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal control. Misstatements are considered material if there is a substantial likelihood that, individually or in the aggregate, they would influence the judgment made by a reasonable user based on the financial statements. In performing an audit in accordance with generally accepted auditing standards and Government Auditing Standards,we: • Exercise professional judgment and maintain professional skepticism throughout the audit. • Identify and assess the risks of material misstatement of the financial statements, whether due to fraud or error, and design and perform audit procedures responsive to those risks. Such procedures include examining, on a test basis, evidence regarding the amounts and disclosures in the financial statements. • Obtain an understanding of internal control relevant to the audit 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 Village's internal control. Accordingly, no such opinion is expressed. • Evaluate the appropriateness of accounting policies used and the reasonableness of significant accounting estimates made by management, as well as evaluate the overall presentation of the financial statements. • Conclude whether, in our judgment, there are conditions or events, considered in the aggregate, that raise substantial doubt about the Village's ability to continue as a going concern for a reasonable period of time. We are required to communicate with those charged with governance regarding, among other matters, the planned scope and timing of the audit, significant audit findings, and certain internal control-related matters that we identified during the audit. Required Supplementary Information Accounting principles generally accepted in the United States of America require that the Management's Discussion and Analysis (on pages 4 through 17), the General Fund Budgetary Comparison Schedule, the Schedule of Changes in the Net Pension Liability (Asset) and Related Ratios, the Schedule of Village Contributions, the Schedule of Investment Returns, the Schedule of Changes in the Total OPEB Liability and Related Ratios, and the Schedules of Proportionate Share of the Net Pension Liability (on pages 94 through 109) be presented to supplement the basic financial statements. Such information is the responsibility of management and, 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. 2 Supplementary 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 accompanying combining and individual nonmajor fund financial statements are presented for purposes of additional analysis and are not a required part of the basic financial statements. Such information is the responsibility of management and was derived from and relates directly to the underlying accounting and other records used to prepare the basic financial statements. The 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 nonmajor fund financial statements are fairly stated, in all material respects, in relation to the basic financial statements as a whole. Other Information Management is responsible for the other information included in the annual report. The other information comprises the introductory and statistical sections but does not include the basic financial statements and our auditor's report thereon. Our opinions on the basic financial statements do not cover the other information, and we do not express an opinion or any form of assurance thereon. In connection with our audit of the basic financial statements, our responsibility is to read the other information and consider whether a material inconsistency exists between the other information and the basic financial statements, or the other information otherwise appears to be materially misstated. If, based on the work performed, we conclude that an uncorrected material misstatement of the other information exists,we are required to describe it in our report. Other Reporting Required by Government Auditing Standards In accordance with Government Auditing Standards, we have also issued our report dated March 11, 2024, 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 solely to describe the scope of our testing of internal control over financial reporting and compliance and the results of that testing, and not to provide an opinion on the effectiveness of the Village's 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 the Village's internal control over financial reporting and compliance. Bradenton, Florida March 11, 2024 3 f MANAGEMENT'S DISCUSSION AND ANALYSIS (MD&A) Management's Discussion and Analysis 2023 Village of Tequesta, Florida Management's Discussion and Analysis As management of the Village of Tequesta, we offer the following narrative overview and analysis of the financial activities of the Village of Tequesta (Village) for the fiscal year ended September 30, 2023. We encourage readers to consider this overview and analysis in combination with the basic financial statements, notes to the financial statements, and the additional information that we have furnished in the letter of transmittal found on pages i to iv of this report. Financial Hi2hli2hts • 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 $48,885,169. Of total net position, 17,962,259 (36.7%) is unrestricted and may be used to meet the ongoing obligations to the citizens and creditors. • The Village's total net position increased during the current period. Net position for governmental activities increased by $1,836,540, due mainly to robust sales of existing residential homes which reset the homestead exemptions and increases in property values. The business-type activities net position increased by $2,695,315, due mainly to increases in user fees, better than projected interest revenue, and transfers to fund needed capital improvements in the systems. • At the close of the current fiscal year, the Village's governmental funds reported a change in combined fund balances of $899,885 due to the building permit fees for the construction of a high-end condominium situated on the Alantic Ocean, increases in ad valorem taxes due to sales of existing residential property significantly contributed to this increase, and strong investment earnings due to active investing and the rate increases. • At the end of the current fiscal year, total fund balance for the general fund was $8,028,736. Of this balance, $634,320 was non-spendable for inventories and prepaid expenditures; $294,000 was restricted for debt service and $500,000 was committed to hurricane/disaster relief, $831,382 was assigned for the subsequent year's budget; and $5,769,034, or 36.0% of general fund operating expenditures and other financing uses was unassigned. At the end of the fiscal year,unrestricted fund balance (the total of the committed, assigned and unassigned components of fund balance) reported in the general fund was $7,100,416. Overview of the Financial Statements This discussion and analysis is intended to serve as an introduction to the Village'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 contains supplementary information intended to furnish additional detail to support the basic financial statements themselves. Government-wide Financial Statements: The government-wide financial statements are designed to provide readers with a broad overview of the Village's finances, in a manner similar to a private-sector business. The statement of net position presents financial information on all of the Village's assets, liabilities, and deferred inflows/outflows of resources, with the difference reported as net position. Over time, increases or 4 Management's Discussion and Analysis 2023 decreases in net position may serve as a useful indicator of whether the financial position of the Village of Tequesta is improving or deteriorating. The statement of activities presents information showing how the Village'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 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 includes general government, public safety, transportation and leisure services. The business-type activities of the Village includes water, stormwater and refuse and recycling. The government-wide financial statements can be found on pages 18-19 of this report. Fund Financial Statements. A fund is a grouping of related accounts that is used to maintain control over resources that have been segregated for specific activities or objectives. The Village of Tequesta, like other state and local governments, uses fund accounting to ensure and demonstrate compliance with financial and legal requirements. All of the funds of the Village 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 utilize the modified accrual basis of accounting which focuses on near-term inflows and ou flows of spendable resources, as well as on balances of spendable resources available at the end of the fiscal year. Such information is useful in assessing a government's near-term financing requirements. Because the focus of governmental funds is different than that of the government-wide financial statements, it is useful to compare the information presented for governmental funds with similar information presented for governmental activities in the government-wide financial statements. By doing so, readers may better understand the long-term impact of the 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 and governmental activities. The Village maintains five 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 balances for the General Fund which is always considered a major fund. Data from the other four 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. The Village adopts an annual appropriated budget for its governmental funds. A budgetary comparison schedule has been provided for the General Fund to demonstrate compliance with this budget. The Village's governmental fund financial statements can be found on pages 20-23 of this report. Proprietary Funds. The Village maintains one type of proprietary fund — enterprise funds. Enterprise funds utilize the full accrual basis of accounting which is the same basis used to report the same functions 5 Management's Discussion and Analysis 2023 presented as business-type activities in the government-wide financial statements. The Village uses enterprise funds to account for its water, stormwater, and refuse &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 non-major fund. The basic proprietary fund financial statements can be found on pages 24-26 of this report. Fiduciary Funds. Fiduciary funds are used to account for resources held for the benefit of parties outside the Village. Fiduciary funds are not reported in the government-wide financial statement because the resources of those funds are not available to support the Village's own programs. The accounting used for fiduciary funds is much like that used for proprietary funds. The Village 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 27-28 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 29-93 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'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 (asset) and related ratios, contributions and pension investment returns. Required supplementary information can be found on pages 94-109 of this report. The combining and individual fund statements and schedules 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 110-117 of this report. Government-wide Overall Financial Analysis 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 at the close of the most recent fiscal year. This change is discussed below. Village of Tequesta's Total Net Position The Village of Tequesta's total assets and deferred outflows exceeded total liabilities and deferred inflows by $48,885,169 at the close of the 2023 fiscal year. Net Position in governmental activities recorded an increase of 8.8%. The Village's business-type activities recorded a 11.5% increase in total net position. This overall increase of 10.2% is the result of the overall results of operations. The majority of this change was due increase in real estate transactions which increased (reset) the taxable value of residential property for ad valorem taxes, interest earnings plus the ramping up for water infrastructure improvements. 6 Management's Discussion and Analysis 2023 PositionMW Village of Tequesta's Net Governmentalor Business-type TotalActivities Activites 2023 2022I I22 2023 2022 Current and other assets $ 13,587,312 $ 15,818,554 $ 10,893,905 $ 9,130,155 $ 24,481,217 $ 24,948,709 Capital assets,net 18,058,974 17,364,642 18,174,184 17,980,929 36,233,158 35,345,571 Total assets 31,646,286 33,183,196 29,068,089 27,111,084 60,714,375 60,294,280 Total deferred outflows of resources 5,219,671 1,990,091 838,539 553,740 6,058,210 2,543,831 Noncurrent liabilities 10,921,930 7,965,616 2,203,279 2,463,697 13,125,209 10,429,313 ther liabilities 1,209,725 1,365,312 1,039,627 850,192 2,249,352 2,215,504 Total liabilities 12,131,655 9,330,928 3,242,906 3,313,889 15,374,561 12,644,817 Total deferred inflows of resources 1,961,214 4,905,811 551,641 934,169 2,512,855 5,839,980 Net position Net investment in capital assets 11,470,215 10,335,163 16,026,834 15,642,791 27,497,049 25,977,954 Restricted Pension Asset 1,013,169 3,675,248 - 503,946 1,013,169 4,179,194 Infrastructure 361,199 568,199 - - 361,199 568,199 Debt Service 294,000 288,000 406,556 391,822 700,556 679,822 Building 1,052,159 832,828 - - 1,052,159 832,828 Law Enforcement 298,778 80,795 - - 298,778 80,795 Unrestricted 8,283,568 5,156,315 9,678,691 6,878,207 17,962,259 12,034,522 Total net position $ 22,773,088 $ 20,936,548 $ 26,112,081 $ 23,416,766 $ 48,885,169 $ 44,353,314 The largest portion of the Village's total net position (56.2%) represents investments in capital assets (e.g., land, buildings, machinery and equipment), less depreciation and 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's net position (7.0%) represents resources that are subject to external restrictions on how they may be used. The remaining balance of$17,962,259 is unrestricted and may be used to meet the government's ongoing obligations to its citizens and creditors. At the end of the current fiscal year, the Village 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. 7 Management's Discussion and Analysis 2023 Village of Tequesta Components of Net Position Restricted ■2022 w 2023 Unrestricted Net Investment in - - capital assets $- $10,000,000 $20,000,000 $30,000,000 8 Management's Discussion and Analysis 2023 Village of Tequesta's Changes in Net Position Village of Tequesta Changes in Net Position Governmental Business-type Total Activities Activities 2023 2022I I22 2023 2022 Revenues: Program Revenues: Charges for Services $ 4,049,386 $ 3,603,521 $ 8,132,497 $ 7,577,143 $ 12,181,883 $ 11,180,664 Operating Grants&Contributions 151,370 1,581,739 - - 151,370 1,581,739 Capital Grants&Contributions 171,857 61,667 163,631 108,464 335,488 170,131 General Revenues: Ad valorem Taxes 9,530,215 8,260,937 - - 9,530,215 8,260,937 Other Taxes 2,365,480 2,170,196 2,365,480 2,170,196 Franchise fees on gross receipts 607,485 530,165 607,485 530,165 Unrestricted intergovernmental 1,110,601 1,062,117 1,110,601 1,062,117 Unrestricted investment earnings 551,106 58,188 312,564 (6,014) 863,670 52,174 Gain(loss)on sale of capital assets 53,480 972 18,500 6,803 71,980 7,775 Other Miscellaneous 37,336 23,999 39,131 45,162 76,467 69,161 Total Revenues 18,628,316 17,353,501 8,666,323 7,731,558 27,294,639 25,085,059 Expenses: General government 3,423,592 2,961,670 - - 3,423,592 2,961,670 Public safety 9,511,503 7,926,208 9,511,503 7,926,208 Transportation 1,847,580 1,986,016 1,847,580 1,986,016 Leisure Services 1,345,068 1,055,418 1,345,068 1,055,418 Interest on long-term debt 147,503 239,652 147,503 239,652 Water utility services - - 5,389,292 5,551,570 5,389,292 5,551,570 Stormwater services 497,582 715,004 497,582 715,004 Refuse&recycling services - - 600,664 529,107 600,664 529,107 Total Expenses 16,275,246 14,168,964 6,487,538 6,795,681 22,762,784 20,964,645 Increase in net position before transfers 2,353,070 3,184,537 2,178,785 935,877 4,531,855 4,120,414 Transfers (516,530) (188,565) 516,530 188,565 - - hicrease in net position 1,836,540 2,995,972 2,695,315 $ 1,124,442 4,531,855 4,120,414 Net position-beginning 20,936,548 17,940,576 23,416,766 22,292,324 44,353,314 40,232,900 etposition-ending $ 22,773,088 $ 20,936,548 $ 26,112,081 $ 23,416,766 $ 48,885,169 $ 44,353,314 For fiscal year ended September 30, 2023, the Village's overall net position increased from the prior fiscal year. Revenues increased in the governmental activities as well as in business-type activities. Combined entity wide revenues exceeded expenses for fiscal year ended September 30, 2023 by $4,531,855. Combined revenues entity-wide increased between FY 2022-23 and FY 2021-22 due to increases in ad valorem taxes (property values appreciating including reconstruction and property sales that reset the homestead exemptions) and increases in charges for services (plan review fees for large construction project completion during the year). These increases were offset by the ending of the Federal ARPA Funding program in FY 2021-22. Revenues increased in business-type activities due to an increase in water utility fees which are earmarked for significant infrastructure improvement projects on the horizon. Also impacting the business-type activities were increases in interest income as well as decreases in expenses as the Water Fund pivots to capital improvements (an asset) instead of repair and maintenance (an expense). Governmental Activities-Expenses and Program/General Revenues Governmental activities. As previously stated, overall revenue from governmental activities decreased from the prior year due largely from infusion of operating grants, ARPA funds in the prior fiscal year. The results of the Village's operations allowed for an overall increase in net position of$1,836,540. 9 Management's Discussion and Analysis 2023 Expenses and Program/General Revenues- Governmental Activities in Thousands $10,000 $8,000 $6,000 $4,000 $2,000 - $0 - - - - - - �s 1fi ■Revenues ■Expenses 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/functions. The net cost of all governmental activities this year was $11,902,633, a 33.4% increase from the prior period. This is mainly a result of adding an additional Firefighter/Paramedic, infromation technology improvements, a full year of operating the newly opened Community Center, and the effects of inflation on prices. As shown on the Statement of Activities, functions directly benefiting from the programs generated revenue of$4,372,613 and the remaining net cost of all governmental activities were financed by ad valorem taxes as well as other taxes (general revenues). 10 Management's Discussion and Analysis 2023 The following is a comparison of revenues by source for governmental activities for fiscal year 2023 and 2022. Revenues by Source- Governmental Activities in Thousands $10,000 $9,000 2022 2023 $8,000 $7,000 $6,000 $5,000 $4,000 $3,000 $2,000 00 $0 'tea G��{� �Y��y�• k �` ��, ��,s Business-type Activities. The Village's business-type activities reported program revenues exceeding expenses by $1,808,590. General revenues and transfers were $886,725. This resulted in an increase in net position of$2,695,315 over the prior year. Total Revenues/Expenses-Business-Type Acth ities in Thousands $8,000 $7,000 $6,000 $5.000 $4,000 $3.000 $2,000 S1,000 0 - Water Utility Refuse&Recycling Stonnixater Utility ■Revenue ■Expenses 11 Management's Discussion and Analysis 2023 As shown in the chart below, revenues from charges for services reported in business-type activities increased by $555,354 from the prior year. An increase in water rates and sales in the Water Utility Fund resulted in the significant portion of the total increase. As stated earlier this increase was necessary to replace the aging infrastructure used for water distribution. The Stormwater Utility reported increases in revenues of 6.5% and Refuse and Recycling revenues increased by 3.5% as contractually required. General Revenues and transfers (non-operating) increased by 1,041.1% over the previous fiscal year due to a transfer from the General Fund to the Stormwater Utility fund for a much needed system repairs and strong interest earnings. Revenues by Source-Business-Type Activities in Thousands $9,000 $8,000 $7,000 $6,000 7 $4,000 $3,000 2102; $2,000 2022 $1,000 $0 - -- — - Charges for Services Non-operating Financial Analysis of the Village's Funds As noted earlier,the Village uses fund accounting to ensure and demonstrate compliance with finance-related legal requirements. Governmental funds: The focus of the Village's governmental funds is to provide information on near term inflows, outflows, and balances of spendable resources. Such information is useful in assessing the Village's financing requirements. In particular, 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 be used for a particular purpose by either an external party, the Village 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, 2023 the Village's governmental funds reported total combined fund balances of $10,966,805. Of this balance $5,769,034 (52.6%) of the combined governmental fund balances is unassigned and is available for spending at the Village's discretion. Approximately 23.2% or $2,543,073 is assigned or committed, with the largest portion assigned to subsequent year's budget. Approximately 18.3 % or $2,006,136 is restricted for a particular purpose (i.e. debt service, Building Fund, Law Enforcement Trust funds, etc.). $648,562 is in nonspendable form (i.e. inventories, prepaid items, etc.). Total combined fund balances have increased(8.9)%over the prior year. 12 Management's Discussion and Analysis 2023 General Fund Components of Fund Balance September 30,2023 and 2022 2022 ■C,,mitted Nonspendable. r Restricted N Assigned ■Unassigned 2023 $0 $2,000,000 $4,000,000 $6,000,000 Governmental Funds Components of Fund Balance September 30,2023 and 2022 2022 ■Committed Nonspendable n-Restricted ■Assigned ■Unassigned 2023 $0 $2,000,000 $4,000,000 $6,000,000 13 Management's Discussion and Analysis 2023 The General Fund is the chief operating fund of the Village. At the end of the current fiscal year total fund balance was $8,028,736, an increase of$16,857 over the prior year. Unassigned fund balance of$5,769,034, increased by$1,393,561 (31.8%) over the prior year. 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 36.9% of fiscal year 2023 General Fund expenditures. The Village's policy is to keep unassigned fund balance at a minimum of three months (25.0%) of expenditures due to our proximity to the Atlantic Ocean and the very real threat of hurricanes. 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 2023of i2022 d valorem taxes $ 9,530,215 55.5% $ 1,269,278 15.4% $ 8,260,937 Other taxes 2,365,480 13.8% 195,284 9.0% 2,170,196 Charges for services 1,620,248 9.4% (28,067) (1.7)% 1,648,315 Intergovernmental 1,110,601 6.5% 48,484 4.6% 1,062,117 ntragovernmental 863,074 5.0% 6,732 0.8% 856,342 Franchise fees 607,485 3.5% 77,320 14.6% 530,165 Licenses and permits 8,710 0.1% 360 4.3% 8,350 Rents and Royalties 220,950 1.3% (10,493) (4.5)% 231,443 Ines and forfeitures 13,050 0.1% (1,973) (13.1)% 15,023 Misc. grants and contributions 339,172 2.0% (1,320,768) (79.6)% 1,659,940 Investment earnings 484,825 2.8% 433,662 847.6% 51,163 Total Revenue $ 17,163,810 100% $ 669,819 4.1% $ 16,493,991 As noted in the table above, total General Fund revenues increased by $669,819 (4.1%). The largest changes were due to: 1) increased ad valorem tax revenue resulting from increased property values,new construction; and property sales which resets the homestead exemption ceilings; 2) increase in other tax revenue which include utility taxes and insurance taxes; 3) investment earnings; and 4) recognition of grant revenue under the American Rescue Plan Act funding was recorded as intergovernmental last year and the program ended. Expenditures in the General Fund are shown in the following schedule: obFunctionL General Fund Expenditures by Function/Classification 90 Change I ' of i ' 2022 eneral government $ 3,227,006 20.7% $ 321,900 11.1% $ 2,905,106 Public Safety 8,002,073 51.2% 399,316 5.3% 7,602,757 Transportation 1,513,186 9.7% 122,064 8.8% 1,391,122 Leisure services 1,100,107 7.0% 279,585 34.1% 820,522 Debt service 591,362 3.8% (293,408) (33.2)% 884,770 Capital outlay 1,192,721 7.6% 922,448 341.3% 270,273 Total expenditures $ 15,626,455 100% $ 1,751,905 12.6% $ 13,874,550 14 Management's Discussion and Analysis 2023 Total General fund expenditures increased from the prior year by $1,751,905 or 12.6%. Information Technology accounted for a significant portion of the general government increase dedicaed to enhancing cyber security. The increase in public safety included a new firefighter and union negoiated raises. The large change in Leisure services is related to the operation of the new community center. The Village paid off a loan for the purchase a pumper truck during the prior year which accounted for the $(293,408) reduction in debt service payments. The Village's purchase of a ladder truck for the Fire Department during the year resulted in the increase of $(922,448) or (341.3)%. Below is a graphical presentation of how the Village expends funds and how they compare to the prior period. General Fund-Expenditures by Source in Thousands $9,000 $8,000 $7,000 $6.000 $5.000 $4,000 $3,000 ' $2,000 $1.000 $0 Kim 1 1 2023 2022 NO At September 30, 2023, ending fund balances for the Non-major Special Revenue funds are as follows: Building Fund - $1,063,644; Special Law Enforcement Fund - $315,397. The ending fund balances in the Non-major Capital Projects Funds are as follows: Capital Projects Fund - 262,355, Capital Improvement Fund -$1,296,673. Fund balances in these funds are restricted or assigned for capital projects/improvements; public safety/enforcement of the building code. The Building Fund derives its revenue primarily from building permit fees, while the Special Law Enforcement Fund receive its revenue from the U.S. Department of Justice from asset forfeitures/seizures. The Capital Projects Fund receives it's funding from the infrastructure sales tax and the water utility tax while the Capital Improvement Fund receives revenue primarily from capital grants and transfers-in from the General Fund plus other funds. General Fund Budgetary Highlights The General Fund original budgeted expenditures were increased by $2,338,706, the majority of which was for the purchase of two fire trucks. Unfortunately the two fire trucks are casualties of the supply chain issues and the ladder truck was not completed until this year and the pumper truck has been completed and will be purchased in fiscal year 2023-24. The General Fund expenditures were less than appropriations by $956,987 or 5.3%the vast majoriy of this is the fire truck, $735,000. 15 Management's Discussion and Analysis 2023 Proprietary funds: The Village's proprietary funds provide the same type of information found in the government-wide financial statements, the main difference is the the basis of account utilized. Proprietary funds use the full accrual basis of accounting while the governmental funds utilize the modifed accrual basis of accounting.. 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 position of the proprietary funds was $26,112,081 an increase of$2,695,315 from the prior period as shown below. Other factors concerning the finances of this major fund have already been addressed in the discussion of the Village's business-type activities. Proprietary Change in Operating Income (Loss) and Net Position Operating Income (Loss) Change in Net Position 2023 2022I2022 Water $ 1,750,834 $ 1,144,584 $ 2,155,894 $ 1,174,434 Stormwater 24,615 (224,737) 564,491 (28,351) Refuse and Recycling (28,291) (21,801) (25,070) (21,641) $ 1,747,158 $ 898,046 $ 2,695,315 $ 1,124,442 Capital Assets and Debt Administration Capital assets: The Village's capital assets for its governmental and business type activities total $36,233,158 (net accumulated depreciation) as of September 30, 2023. The Village acquired $2,791,837 in assets during the year and disposed of$665,860 during the year. Additional information on the Village's capital assets can be found in Note 3D, Capital Assets, starting on page 51 of this report. Capital Assests Governmental Activities Business-type Activities Total 2023 2022I I22 2023 2022 Land $ 634,017 $ 634,017 $ 83,335 $ 83,335 $ 717,352 $ 717,352 Construction in progress 25,524 18,750 1,559,852 834,115 1,585,376 852,865 Buildings 14,693,652 14,693,652 972,980 972,980 15,666,632 15,666,632 mprovements 2,509,454 2,509,454 58,720 58,720 2,568,174 2,568,174 nfrastructure 5,444,760 5,265,715 37,920,088 37,702,900 43,364,848 42,968,615 Machinery&Equipment 5,987,473 4,997,633 2,094,975 2,071,294 8,082,448 7,068,927 ntangibles - - 48,649 48,649 48,649 48,649 ther-K-9 20,549 20,549 - - 20,549 20,549 Total capital assets 29,315,429 28,139,770 42,738,599 41,771,993 72,054,028 69,911,763 Less accumulated depreciation (11,256,455) (10,775,128) (24,564,415) (23,807,352) (35,820,870) 34,582,480 Total capital assets,net $ 18,058,974 $ 17,364,642 $ 18,174,184 $ 17,964,641 $ 36,233,158 $ 35,329,283 16 Management's Discussion and Analysis 2023 Noncurrent liabilities: At the end of the current fiscal year, the Village had a total of $14,080,022 of noncurrent liabilities. The largest portion are debt instruments in the form of promissory notes with Bank of America that are secured by general revenue sources, not the full faith and credit of the Village. The table below summarizes the Village's debt position. In accordance with GASB Statements No's. 68 and 75,the Village recognized a net pension liability(NPL)of $3,753,473 and a total OPEB liability of $820,761, respectively. The Village is presenting the NPL and OPEB liability as separate components of the noncurrent liabilities on the face of the financial statements to present more clearly the Village's long-term pension and other post-employment benefit obligations. A more detailed explanation can be found in Note 3.K—Noncurrent Liabilities. Noncurrent Liabilities Governmental Activities Business-type Activities Total 2023 2022I I22 2023 2022 Notes payable $ 6,405,000 $ 6,693,000 $ 1,952,564 $ 2,344,386 $ 8,357,564 $ 9,037,386 Financed purchases 183,758 336,478 - - 183,758 336,478 Compensated absences 836,773 774,369 127,693 143,902 964,466 918,271 Total OPEB Liability 651,857 714,574 168,904 198,826 820,761 913,400 Net Pension Liability 3,367,799 3,367,799 385,674 183,405 3,753,473 3,551,204 Total Noncurrent Liabilities $ 11,445,187 $ 11,886,220 $ 2,634,835 $ 2,870,519 $ 14,080,022 $ 14,756,739 Economic Factors and Next Year's Budgets and Rates The following economic factors currently affect the Village of Tequesta and were considered in developing the 2023-2024 fiscal year budget: • The Village Council's decision to reduce the millage rate from 6.6290 to 6.4595. • Significant new construction of a luxury condominium, reconstruction, and home sales caused the gross taxable value of properties to increase 26.3%. Approximately 80% of the residential housing have the homestead exemption. • Interest rates are expected to be reduced slowly which will positively effect interest earnings. • The Village Council approved water rate increase of 8.5%to fund capital needs. • Two new Firefighters/Paramedics approved for the Village Council's goal of eight person shifts for resident safety. • Village Council approved increase of 3.5%in refuse and recycling rates. • Village Council approved increase of 5.0%in stormwater rates. 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 30,2023 Business- Governmental type Activities Activities Total Assets Cash $ 5,396,651 $ 5,676,754 $ 11,073,405 Investments 4,830,304 4,041,966 8,872,270 Receivables,net 1,698,626 871,390 2,570,016 Inventories 40,611 254,062 294,673 Prepaid items 607,951 49,733 657,684 Net pension asset 1,013,169 - 1,013,169 Capital assets not being depreciated 659,541 1,643,187 2,302,728 Capital assets being depreciated,net 17,399,433 16,530,997 33,930,430 Total Assets 31,646,286 29,068,089 60,714,375 Deferred Outflows of Resources Deferred outflows-pensions 4,919,588 660,618 5,580,206 Deferred outflows-OPEB 300,083 77,756 377,839 Deferred charge on refunding - 100,165 100,165 Total Deferred Outflows of Resources 5,219,671 838,539 6,058,210 Liabilities Accounts payable 398,937 537,277 936,214 Accrued liabilities 192,896 33,087 225,983 Accrued interest payable 69,815 - 69,815 Customer deposits - 37,430 37,430 Unearned revenue 11,500 - 11,500 Due to other governments 13,320 277 13,597 Noncurrent liabilities: Due within one year 523,257 431,556 954,813 Due in more than one year 6,902,274 1,648,701 8,550,975 Total OPEB liability due in more than one year 651,857 168,904 820,761 Net pension liability due in more than one year 3,367,799 385,674 3,753,473 Total Liabilities 12,131,655 3,242,906 15,374,561 Deferred Inflows of Resources Deferred inflows-pensions 868,837 525,291 1,394,128 Deferred inflows-leases 990,685 - 990,685 Deferred inflows-OPEB 101,692 26,350 128,042 Total Deferred Inflows of Resources 1,961,214 551,641 2,512,855 Net Position Net investment in capital assets 11,470,215 16,026,834 27,497,049 Restricted: Pension Asset 1,013,169 - 1,013,169 Infrastructure 361,199 - 361,199 Debt Service 294,000 406,556 700,556 Building 1,052,159 - 1,052,159 Law Enforcement 298,778 - 298,778 Unrestricted 8,283,568 9,678,691 17,962,259 Total Net Position $ 22,773,088 $ 26,112,081 $ 48,885,169 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 30,2023 Net(Expense)Revenue and Program Revenues Changes in Net Position Primary Government Operating Capital Grants Charges for Grants and and Governmental Business-type Functions/Programs Expenses Services Contributions Contributions Activities Activities Total Primary Government Governmental Activities General government $ 3,423,592 $ 1,468,110 $ 8,266 $ 102,258 $ (1,844,958) $ $ (1,844,958) Public safety 9,511,503 2,425,081 131,229 19,599 (6,935,594) (6,935,594) Transportation 1,847,580 - - - (1,847,580) (1,847,580) Leisure services 1,345,068 156,195 11,875 50,000 (1,126,998) (1,126,998) Interest on long-term debt 147,503 - - - (147,503) (147,503) Total governmental activities 16,275,246 4,049,386 151,370 171,857 (11,902,633) (11,902,633) Business-type Activities Water 5,389,292 7,037,927 - 149,246 1,797,881 1,797,881 Stormwater utility 497,582 522,197 14,385 39,000 39,000 Refuse and Recycling 600,664 572,373 (28,291) (28,291) Total business-type activities 6,487,538 8,132,497 163,631 1,808,590 1,808,590 Total primary government $ 22,762,784 $ 12,181,883 $ 151,370 $ 335,488 (11,902,633) 1,808,590 (10,094,043) General Revenues and transfers General revenues: Ad valorem taxes 9,530,215 - 9,530,215 Utility taxes 995,056 995,056 Communication service tax 323,005 323,005 Insurance premium taxes 353,605 353,605 Infrustructure surtax 603,101 603,101 Business taxes 90,713 90,713 Franchise fees based on gross receipts 607,485 607,485 Unrestricted intergovernmental revenues 1,110,601 - 1,110,601 Unrestricted investment earnings 551,106 312,564 863,670 Gain on sale of capital assets 53,480 18,500 71,980 Miscellaneous revenues 37,336 39,131 76,467 Transfers (516,530) 516,530 - Total general revenues and transfers 13,739,173 886,725 14,625,898 Change in net position 1,836,540 2,695,315 4,531,855 Net Position-Beginning 20,936,548 23,416,766 44,353,314 NetPosition-Ending $ 22,773,088 $ 26,112,081 $ 48,885,169 The accompanying notes are an integral part of these financial statements. 19 VILLAGE OF TEQUESTA,FLORIDA BALANCESHEET GOVERNMENTAL FUNDS SEPTEMBER 30,2023 Nonmajor Total General Governmental Governmental Fund Funds Funds Assets Cash $ 2,320,899 $ 3,075,752 $ 5,396,651 Investments 4,830,304 - 4,830,304 Receivables,net 1,698,442 184 1,698,626 Inventories 40,501 110 40,611 Prepaid items 593,819 14,132 607,951 Total Assets $ 9,483,965 $ 3,090,178 $ 12,574,143 Liabilities Accounts payable $ 268,142 $ 130,795 $ 398,937 Accrued liabilities 183,505 9,391 192,896 Unearned revenue 11,500 - 11,500 Due to other governments 1,397 11,923 13,320 Total Liabilities 464,544 152,109 616,653 Deferred Inflows of Resources Deferred inflows -leases 990,685 - 990,685 Total Deferred Inflows of Resources 990,685 - 990,685 Fund Balances Nonspendable: Inventories 40,501 110 40,611 Prepaid items 593,819 14,132 607,951 Restricted: Infrastructure - 361,199 361,199 Debt Service 294,000 - 294,000 Building - 1,052,159 1,052,159 Law Enforcement - 298,778 298,778 Committed to: Disaster Reserve 500,000 - 500,000 Capital Projects - 271,687 271,687 Assigned to: Capital Projects - 309,045 309,045 Subsequent years budget 831,382 630,959 1,462,341 Unassigned: General Fund 5,769,034 - 5,769,034 Total Fund Balances 8,028,736 2,938,069 10,966,805 Total Liabilities and Fund Balances $ 9,483,965 $ 3,090,178 $ 12,574,143 The accompanying notes are an integral part of these financial statements. 20 VILLAGE OF TEQUESTA,FLORIDA RECONCILIATION OF THE BALANCE SHEET OF GOVERNMENTAL FUNDS TO THE STATEMENT OF NET POSITION SEPTEMBER 30,2023 Amounts reported for governmental activities in the statement of net position are different because: Total Fund Balances-Governmental Funds $ 10,966,805 Net pension asset is not considered to represent a financial asset in the governmental funds. 1,013,169 Net capital assets used in the governmental activities are not financial resources and,therefore are not reported in the governmental funds. 18,058,974 Deferred outflows of resources related to pensions and OPEB transactions not reported in the governmental funds. 5,219,671 Deferred inflows of resources related to pensions and OPEB transactions not recognized in the governmental funds. (970,529) Long-term liabilities,including notes payable,are not due and payable in the current period and,therefore,are not reported in the governmental funds: Loans payable (7,495,346) Total OPEB liability is not due and payable in the current period and,therefore, not reported in the governmental funds. (651,857) Net pension liability is not due and payable in the current period and,therefore, not reported in the governmental funds. (3,367,799) Net Position of Governmental Activities $ 22,773,088 The accompanying notes are an integral part of these financial statements. 21 VILLAGE OF TEQUESTA,FLORIDA STATEMENT OF REVENUES,EXPENDITURES AND CHANGES IN FUND BALANCES GOVERNMENTAL FUNDS FOR THE FISCAL YEAR ENDED SEPTEMBER 30,2023 Nonmajor Total General Governmental Governmental Fund Funds Funds Revenues Ad valorem taxes $ 9,530,215 $ - $ 9,530,215 Other taxes 2,365,480 - 2,365,480 Charges for services 1,620,248 3,074 1,623,322 Intergovernmental 1,110,601 - 1,110,601 Intragovernmental 863,074 - 863,074 Licenses and permits 8,710 1,053,625 1,062,335 Franchise fees 607,485 - 607,485 Rents and royalties 220,950 - 220,950 Miscellaneous 35,544 - 35,544 Fines and forfeitures 13,050 268,447 281,497 Grants,contributions and donations 303,628 - 303,628 Investment earnings 484,825 66,281 551,106 Total Revenues 17,163,810 1,391,427 18,555,237 Expenditures General government 3,227,006 - 3,227,006 Public safety 8,002,073 884,633 8,886,706 Transportation 1,513,186 121,784 1,634,970 Leisure services 1,100,107 - 1,100,107 Capital outlay 1,192,721 559,430 1,752,151 Debt service: Principal 440,720 - 440,720 Interest 150,642 - 150,642 Total Expenditures 15,626,455 1,565,847 17,192,302 Excess(Deficiency)of Revenues Over Expenditures 1,537,355 (174,420) 1,362,935 Other Financing Sources(Uses) Transfers in - 1,168,478 1,168,478 Transfers out (1,573,978) (111,030) (1,685,008) Sale of capital assets 53,480 - 53,480 Total Other Financing Sources(Uses) (1,520,498) 1,057,448 (463,050) Net change in fund balances 16,857 883,028 899,885 Fund Balances-Beginning 8,011,879 2,055,041 10,066,920 Fund Balances-Ending $ 8,028,736 $ 2,938,069 $ 10,966,805 The accompanying notes are an integral part of these financial statements. 22 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 30,2023 Amounts reported for governmental activities in the statement of activities are different because: Net change in fund balances-total governmental funds $ 899,885 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/amortization in the current period. The details of the difference are as follows: Capital outlay 1,752,151 Donated capital assets 19,599 Depreciation/amortization expense (1,077,418) 694,332 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. Payment on notes payable 288,000 Payment on financed purchases 152,720 440,720 Some revenues and expenses reported in the statement of activities do not require the use of current financial resources and,therefore,are not reported in governmental funds: The details of the difference are as follows: Accrued interest payable 3,139 Compensated absences (62,404) Total OPEB liability (62,180) Net pension related (76,952) (198,397) Change in net position of governmental activities $ 1,836,540 The accompanying notes are an integral part of these financial statements. 23 VILLAGE OF TEQUESTA,FLORIDA STATEMENT OF NET POSITION PROPRIETARY FUNDS SEPTEMBER 30,2023 Business-type Activities Nonmajor Water Refuse& N'und Stormwater Recycling Total Assets Current Assets: Cash $ 5,079,462 $ 503,470 $ 93,822 $ 5,676,754 Investments 4,041,966 - - 4,041,966 Receivables,net 858,834 9,571 2,985 871,390 Inventories 253,650 412 - 254,062 Prepaid items 49,733 - - 49,733 Total Current Assets 10,283,645 513,453 96,807 10,893,905 Non-current Assets: Capital assets not being depreciated 1,425,538 217,649 - 1,643,187 Capital assets being depreciated,net 14,532,831 1,998,166 - 16,530,997 Total Non-Current Assets 15,958,369 2,215,815 - 18,174,184 Total Assets 26,242,014 2,729,268 96,807 29,068,089 Deferred Outflows of Resources Deferred outflows-pensions 608,560 52,058 - 660,618 Deferred outflows-OPEB 70,995 6,761 - 77,756 Deferred charge on refunding 100,165 - - 100,165 Total Deferred Outflows of Resources 779,720 58,819 - 838,539 Liabilities Current Liabilities: Accounts payable $ 270,605 $ 217,438 $ 49,234 $ 537,277 Accrued liabilities 31,352 1,735 - 33,087 Customer deposits 37,430 - - 37,430 Compensated absences 25,000 - - 25,000 Due to other governments 277 - - 277 Notes payable 406,556 - - 406,556 Total Current Liabilities 771,220 219,173 49,234 1,039,627 Noncurrent Liabilities: Compensated absences 100,758 1,935 - 102,693 Notes payable 1,546,008 - - 1,546,008 Net pension liability 359,551 26,123 - 385,674 Total OPEB liability 154,217 14,687 - 168,904 Total Noncurrent Liabilities 2,160,534 42,745 - 2,203,279 Total Liabilities 2,931,754 261,918 49,234 3,242,906 Deferred Inflows of Resources Deferred inflows-pensions 513,952 11,339 - 525,291 Deferred inflows-OPEB 24,059 2,291 - 26,350 Total Deferred Inflows of Resources 538,011 13,630 - 551,641 Net Position Net investment in capital assets 13,995,149 2,031,685 - 16,026,834 Restricted: Debt Service 406,556 - - 406,556 Unrestricted 9,150,264 480,854 47,573 9,678,691 Total Net Position $ 23,551,969 $ 2,512,539 $ 47,573 $ 26,112,081 The accompanying notes are an integral part of these financial statements. 24 VILLAGE OF TEQUESTA,FLORIDA STATEMENT OF REVENUES,EXPENSES AND CHANGES IN NET POSITION PROPRIETARY FUNDS FOR THE FISCAL YEAR ENDED SEPTEMBER 30,2023 Business-type Activities Nonmaj or Water Refuse& 1,'und Stormwater Recycling Total Operating Revenues Charges for services: Metered water sale $ 7,037,927 $ - $ - $ 7,037,927 Stormwater fees - 522,197 - 522,197 Refuse and recycling fees - - 572,373 572,373 Total Operating Revenues 7,037,927 522,197 572,373 8,132,497 Operating Expenses Cost of sales and services: Plant production 2,124,372 - - 2,124,372 Distribution 1,185,754 - - 1,185,754 Stormwater - 259,151 - 259,151 Purchased services - - 590,992 590,992 Management services 657,362 88,385 9,672 755,419 Administration 642,819 - - 642,819 Depreciation/amortization 676,786 150,046 - 826,832 Total Operating Expenses 5,287,093 497,582 600,664 6,385,339 Operating Income(Loss) 1,750,834 24,615 (28,291) 1,747,158 Non-Operating Revenues(Expenses) Investment earnings 307,757 1,586 3,221 312,564 Interest expense (102,199) - - (102,199) Gain on disposal of capital assets 11,125 7,375 - 18,500 Miscellaneous revenue 39,131 - - 39,131 Total Non-Operating Revenues 255,814 8,961 3,221 267,996 Income(loss)Before Transfers and Contributions 2,006,648 33,576 (25,070) 2,015,154 Transfers in - 516,530 - 516,530 Capital contributions-tap fees 149,246 - - 149,246 Capital contributions-grants - 14,385 - 14,385 Change in Net Position 2,155,894 564,491 (25,070) 2,695,315 Net Position-Beginning 21,396,075 1,948,048 72,643 23,416,766 Net Position-Ending $ 23,551,969 $ 2,512,539 $ 47,573 $ 26,112,081 The accompanying notes are an integral part of these financial statements. 25 VILLAGE OF TEQUESTA,FLORIDA STATEMENT OF CASH FLOWS PROPRIETARY FUNDS FOR THE FISCAL YEAR ENDED SEPTEMBER 30,2023 Business-type Activities Water Storm Water Refuse Fund Fund Nonmajor Fund Totals Cash Flows from Operating Activities Cash received from customers,governments and other funds $ 7,085,884 $ 523,629 $ 572,306 $ 8,181,819 Cash paid to suppliers for goods and services (2,569,709) (73,807) (594,781) (3,238,297) Cash paid to employees for services and benefits (2,058,240) (112,512) - (2,170,752) Net Cash Provided by(Used in)Operating Activities 2,457,935 337,310 (22,475) 2,772,770 Cash Flows from Non Capital Financing Activities Short-term interfund borrowings - (45,000) - (45,000) Transfers from other funds - 561,530 - 561,530 Net Cash Provided by Non Capital Financing Activities - 516,530 - 516,530 Cash Flows from Capital and Related Financing Activities Acquisition and construction of capital assets (591,468) (428,619) - (1,020,087) Cash received from sale of capital assets 11,125 7,375 - 18,500 Capital contributions 149,246 14,385 - 163,631 Principal payments on long-term debt (391,822) - - (391,822) Interest paid (80,936) - - (80,936) Net Cash Used in Capital and Related Financing Activities (903,855) (406,859) - (1,310,714) Cash Flows from Investing Activities Purchase of investments (1,606,119) - - (1,606,119) Interest and micsellaneous income 362,126 1,586 3,221 366,933 Net Cash Provided by(Used in)Investing Activities (1,243,993) 1,586 3,221 (1,239,186) Net Change in Cash and Cash Equivalents 310,087 448,567 (19,254) 739,400 Cash and Cash Equivalents-Beginning 4,769,375 54,903 113,076 4,937,354 Cash and Cash Equivalents-Ending $ 5,079,462 $ 503,470 $ 93,822 $ 5,676,754 Adjustments to Reconcile Operating Income(Loss)to Net Cash Provided by(Used in)Operating Activities Operating income(loss) $ 1,750,834 $ 24,615 $ (28,291) $ 1,747,158 Adjustments to reconcile operating Income(Loss)to net cash provided by(used in)operating activities: Depreciation/Amortization 676,786 150,046 - 826,832 Changes in operating assets,liabilities and deferred inflows/ outflows of resources: (Increase)decrease in: Accounts receivable 52,957 1,432 (67) 54,322 Inventories (30,638) (363) - (31,001) Prepaid items 38,472 792 - 39,264 Increase(decrease)in: Accounts payable 15,156 153,770 5,883 174,809 Accrued liabilities (1,938) (41) - (1,979) Customer deposits (5,000) - - (5,000) Long-term assets/liabilities (36,769) 7,059 - (29,710) Due to other governments (1,925) - - (1,925) Net Cash Provided by(Used in)Operating Activities $ 2,457,935 $ 337,310 $ (22,475) $ 2,772,770 Schedule of non-cash capital and related financing activities: Unrealized loss on investments $ 15,238 $ - $ - $ 15,238 The accompanying notes are an integral part of these financial statements. 26 VILLAGE OF TEQUESTA, FLORIDA STATEMENT OF FIDUCIARY NET POSITION SEPTEMBER 30,2023 Pension Trust Funds Assets Cash and cash equivalents $ 387,609 Investments Equities 20,303,968 Fixed Income 6,952,753 Real Estate Fund 3,140,962 Total investments 30,397,683 Contributions receivable 49,770 Accrued interest receivable 36,895 Total Assets 30,871,957 Liabilities Accounts payable 34,491 Total Liabilities 34,491 Net Position Restricted for Pension Benefits $ 30,837,466 The accompanying notes are an integral part of these statement. 27 VILLAGE OF TEQUESTA, FLORIDA STATEMENT OF CHANGES IN FIDUCIARY NET POSITION FOR THE FISCAL YEAR ENDED SEPTEMBER 30,2023 Pension Trust Funds Additions Contributions: State of Florida $ 353,604 Employer 897,659 Employee 398,999 Total Contributions 1,650,262 Investment Earnings Net appreciation in fair value of investments 1,878,001 Gain on sale of investments 155,139 Interest and dividends 625,998 2,659,138 Less investment expenses (115,519) Net Investment Earnings 2,543,619 Total Additions 4,193,881 Deductions Benefits paid 721,435 Refund of contributions 643,714 Administrative expenses 122,710 Total Deductions 1,487,859 Change in Net Position 2,706,022 Net Position Restricted for Pension Benefits Beginning of year 28,131,444 End of year $ 30,837,466 The accompanying notes are an integral part of these statement. 28 r , NOTES TO BASIC FINANCIAL STATEMENTS VILLAGE OF TEQUESTA, FLORIDA NOTES TO FINANCIAL STATEMENTS FOR THE FISCAL YEAR ENDED SEPTEMBER 30,2023 Note 1—Summary of Significant Accounting Policies A. Description of'Government-Wide Financial Statements 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. 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. Reporting Entity The Village of Tequesta, Florida (the Village) 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, refuse &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, or has operational responsibility. The Village has no component units to report. The financial statements of the Village have been prepared in conformity with accounting principles generally accepted in the United States of America (U.S. GAAP) as applied to governmental units. The Governmental Accounting Standards Board (GASB) is the accepted standard-setting body for establishing governmental accounting and financial reporting principles. C. Basis of Presentation—Government-Wide Financial Statements 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-type 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. 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's water and various other functions of the government. Elimination of these 29 VILLAGE OF TEQUESTA, FLORIDA NOTES TO FINANCIAL STATEMENTS FOR THE FISCAL YEAR ENDED SEPTEMBER 30,2023 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. Basis of'Presentation—Fund Financial Statements 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. The Village reports the following major enterprise funds: The Water 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: The pension trust funds account for the activities of the Public Safety Employees' (Police and Fire) 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 (short-term) and advances to/from other funds (long-term). 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 30 VILLAGE OF TEQUESTA, FLORIDA NOTES TO FINANCIAL STATEMENTS FOR THE FISCAL YEAR ENDED SEPTEMBER 30,2023 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 transfers 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. Measurement Focus and Basis of Accounting 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. The government-wide financial statements are reported using the economic resources measurement focus and the accrual basis of accounting. Revenues are recorded when earned and expenses are recorded when a liability is incurred, regardless of the timing of related cash flows. 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. The governmental fund financial statements are reported using the current financial resources measurement focus and the modified accrual basis of accounting. Revenues are recognized as soon as they are both measurable and available. Revenues are considered to be available when they are collectible within the current period or soon enough thereafter to pay liabilities of the current period. For this purpose,the Village considers revenues to be available if they are collected within 60 days of the end of the current fiscal period. Expenditures generally are recorded when a liability is incurred, as under accrual accounting. However, debt service expenditures, including lease liabilities, as well as expenditures related to compensated absences, and claims and judgments, are recorded only when payment is due. Capital asset acquisitions, including entering into contracts giving the Village the right to use leased assets, are reported as expenditures in governmental funds. Issuance of long-term debt and financing through 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 60 days of year-end). Expenditure driven 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 60 days of year-end). All other revenue items are considered to be measurable and available only when cash is received by the Village. 31 VILLAGE OF TEQUESTA, FLORIDA NOTES TO FINANCIAL STATEMENTS FOR THE FISCAL YEAR ENDED SEPTEMBER 30,2023 The proprietary funds are reported using the economic resources measurement focus and the accrual basis of accounting for reporting its assets and liabilities and deferred inflows and outflows of resources (as described previously). 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, except for a money market fund which is reported at amortized cost; securities traded in the over-the-counter market and listed securities for which no sales were 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. E Budgetary Information 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 therefore at the fund level. 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 executory contract is expected in the next year) are re-appropriated and become part of the subsequent year's budget pursuant to state regulations. G.Assets,Liabilities,Deferred Ou0ows/InfZows of Resources, and Net Position/Fund Balance 1. Cash The Village's cash is considered to be cash on hand and demand deposits. 2. Investments The Village has adopted an investment policy in accordance with Section 218.415, Florida Statutes that allows the Village to invest in relatively low risk securities, such as certificates of deposit, money market accounts, and U.S. Government Securities and Agencies. Investments are stated at fair value or amortized cost which approximates fair value. 32 VILLAGE OF TEQUESTA, FLORIDA NOTES TO FINANCIAL STATEMENTS FOR THE FISCAL YEAR ENDED SEPTEMBER 30,2023 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 $5,000 or more and an estimated useful life in excess of one year. For infrastructure and intangible assets the same estimated minimum useful life is used (in excess of one year), 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 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 acquisition value at the date of donation. 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: Buildings 20—40 years Improvements 20—40 years Infrastructure 20—50 years Machinery and equipment 5 — 15 years Intangibles 5 —20 years Other 5 — 15 years 5. Leases Lessor The Village is a lessor for noncancellable leases of certain parcels of real property. Lease receivable is measured at the commencement date at the present value of payments expected to be received during the lease term. Subsequently,the lease receivable is reduced by the principal portion of lease payments received. The deferred inflow of resources is measured as the initial amount of the lease receivable, adjusted for lease payments received at or before the lease commencement. Subsequently, the deferred inflow of resources is recognized as revenue over the life of the lease term. 33 VILLAGE OF TEQUESTA, FLORIDA NOTES TO FINANCIAL STATEMENTS FOR THE FISCAL YEAR ENDED SEPTEMBER 30,2023 Lease assets are reported with other capital assets and lease receivables are reported on the balance sheet and on the statement of net position. 6. Deferred Outflows/Inflows of Resources In addition to assets, the statement of net position reports a separate section for deferred ou flows Of resources. This separate financial statement element represents a consumption of net assets that applies to a future period(s) and will not be recognized as an outflow of resources (expense/expenditure) until then. The Village has three items that qualify for reporting in this category. They are; 1) Deferred outflows related to pensions; 2) Deferred outflows related to OPEB; and 3) Deferred charge on refunding resulting from the difference in the carrying value of refunded debt and its reacquisition price, and is amortized over the shorter of the life of the refunded or refunding debt. These items are reported in the government-wide statement of net position and the statement of net position of the proprietary funds. In addition to liabilities,the statement of net position reports a separate section for deferred inflows Of resources. This separate financial statement element represents an acquisition of net assets that applies to a future period(s) and will not be recognized as an inflow of resources (revenue) until that time. The Village has two items that qualify for reporting in this category- 1) Deferred inflows related to pensions and 2) Deferred inflows related to leases. This items reported in the balance sheet governmental funds and/or government-wide statement of net position and the statement of net position of the proprietary funds. 7. 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. 8. 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. 9. Fund Balance Policies The Village classifies fund balance in accordance with GASB Statement No.54 Fund Balance Reporting and Governmental Fund Type Definitions. This statement enhances the usefulness of fund balance information by providing clearer fund balance classifications that can be more consistently applied and by clarifying the existing governmental fund type definitions. In the fund 34 VILLAGE OF TEQUESTA, FLORIDA NOTES TO FINANCIAL STATEMENTS FOR THE FISCAL YEAR ENDED SEPTEMBER 30,2023 financial statements, governmental funds report classifications that comprise a hierarchy based primarily on the extent to which the Village is bound to honor constraint of the specific purposes for which amounts in those funds can be spent. The Village reports the following fund classifications: Nonspendable fund balance. Nonspendable fund balances are amounts that cannot be spent because they are either not in spendable form such as inventory or legally or contractually required to be maintained intact such as a perpetual trust. Restricted fund balance. Restricted fund balances are amounts that are constrained by the imposition externally by creditors, grantors, or laws or regulations of other governmental agencies or imposed by law through constitutional provisions or enabling legislation. Committed fund balance. Those amounts can only be used for 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 that can, by adoption of an ordinance or resolution equally binding and 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. Assigned fund balance. 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. Unassigned fund balance. Unassigned fund balance represents fund balance that has not been assigned to other funds and that has not been restricted, committed, or assigned to specific purposes within the general fund. The General Fund is the only fund that reports a positive unassigned fund balance amount. The other governmental funds may report negative unassigned fund balance if that fund's expenditures incurred for specific purposes exceed the amounts that are restricted, committed, or assigned to those purposes. H.Revenues and Expenditures/Expenses 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. 35 VILLAGE OF TEQUESTA, FLORIDA NOTES TO FINANCIAL STATEMENTS FOR THE FISCAL YEAR ENDED SEPTEMBER 30,2023 2. Property Taxes Property tax collections are governed by Chapter 197, Florida Statutes. Property taxes are based on assessed property value at January 1st as determined by the Palm Beach County Property Appraiser. The Village 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 Village's millage rate to a maximum of 10 mills, excluding voter-approved debt service millage rates. The millage rate for the Village in fiscal year 2023 was 6.6290 mills. Tax bills are mailed out November 1st and discounts are available for payments made in the following months; November 4%, December 3%, January 2% and February 1%. Taxes become delinquent on April 1st. 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. 4. Proprietary Funds Operating and Non-Operating Revenues and Expenses Proprietary funds distinguish operating revenues and expenses from non-operating items. Operating revenues and expenses generally result from providing services and producing and delivering goods in connection with a proprietary fund's principal ongoing operations. The principal operating revenues of the 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. 36 VILLAGE OF TEQUESTA, FLORIDA NOTES TO FINANCIAL STATEMENTS FOR THE FISCAL YEAR ENDED SEPTEMBER 30,2023 L Use of'Estimates 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 deferred outflows of resources and liabilities and deferred inflows of resources 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. J. Implementation of new GASB Pronouncements In May 2020, GASB issued Statement No. 96, Subscription-Based Information Technology Arrangements (SBITA), which is effective for the Village beginning with its fiscal year ending September 30, 2023. This Statement provides new guidance that establishes a single approach to accounting for and reporting SBITAs by state and local governments. The goal is to establish that a SABITA results in a right-to-use subscription asset, an intangible asset, and corresponding subscription liability, as well as provide greater transparency and usefulness of financial statements. The implementation of this pronouncement did not result in any financial impact to the Village. In June 2022, GASB issued Statement No. 100,Accounting Changes and Error Corrections,which will be effective for the Village beginning with its fiscal year ending September 30, 2024. This standard will enhance accounting and financial reporting requirements for accounting changes and error corrections to provide more understandable, reliable, relevant, consistent, and comparable information for making decision or assessing accountability. In June 2022, GASB issued Statement No. 101, Compensated Absences, which is effective for the Village beginning with its fiscal year ending September 30, 2025. The objective of this standard is to better meet the information needs of financial statement users by updating the recognition and measurement guidance for compensated absences. The object is achieved by aligning the recognition and measurement guidance under a unified model. In December 2023, GASB issued Statement No. 102, Certain Risk Disclosures,which is effective for the Village beginning with its year ending year end September 30, 2026. The objective of this standard is to improve financial reporting by providing users of financial statements with essential information that is not currently provided. This includes information about risks related to a government's vulnerabilities due to certain concentration or constraints. The Village continues to review this standard to assess the impact on it's financial reporting. 37 VILLAGE OF TEQUESTA, FLORIDA NOTES TO FINANCIAL STATEMENTS FOR THE FISCAL YEAR ENDED SEPTEMBER 30,2023 Note 2—Reconciliation of Government-Wide and Fund Financial Statements A. Explanation of Certain Differences Between the Governmental Fund Balance Sheet and the Government-wide Statement of Net Position 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 $18,058,974 as explained in the following detail (additional details shown in Note 3.D.): Capital assets not being depreciated: Land $ 634,017 Construction in progress 25,524 Capital assets being depreciated: Buildings,net 10,445,580 Improvements other than buildings,net 723,435 Infrastructure,net 3,883,852 Machinery and equipment,net 2,342,163 Other K-9,net 4,403 Net Adjustment to Increase Fund Balance- Total Governmental Funds to Arrive at Net Position - Governmental Activities $ 18,058,974 Another 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 $7,495,346 difference are as follows: Note payable $ 6,405,000 Financed purchases 183,758 Compensated absences 836,773 Accrued interest pyable 69,815 Net Adjustment to Increase Fund Balance- Total Governmental Funds to Arrive at Net Position— Governmental Activities $ 7,495,346 38 VILLAGE OF TEQUESTA, FLORIDA NOTES TO FINANCIAL STATEMENTS FOR THE FISCAL YEAR ENDED SEPTEMBER 30,2023 Note 3—Detailed Notes on All Activities and Funds A. Cash Deposits with Financial Institution 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 (QPD) 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, 2023, none of the Village's primary bank balances or certificates of deposit were exposed to custodial credit risk. B. Investments 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 Florida local government investment pool valance consists of two governmental investment pools: Florida Cooperative Liquid Assets Securities System (FLCLASS) and Florida Surplus Asset Fund (FLSAFE). The pools are organized under Florida Statutes Section 163,the Florida Interlocal Cooperation Act, by Florida public agencies for the purpose of operating an independent investment pool for local governments and administered by a Board of Trustees elected by the participants in the pool. FLCLASS and FLSAFE are operated in a manner consistent with SEC Rule 2a7 of the Investment Company Act of 1940. Rule 2a7 allows SEC registered mutual funds to use amortized cost rather than fair value, to report net position used to compute share prices if certain conditions are met. Those conditions included restrictions on the types of investments held, restrictions on the term to maturity of individual investments, the dollar weighted average of the portfolio, requirement for portfolio diversification, and requirement of divestiture considerations in the event of security downgrades and defaults,plus required actions if the fair value of the portfolio deviates from amortized costs by a specific amount. The fair value of the position in the pools is considered to be the same as the Village's account balance (amortized cost) in the pool. These pools are not insured by FDIC or any other governmental agency. 39 VILLAGE OF TEQUESTA, FLORIDA NOTES TO FINANCIAL STATEMENTS FOR THE FISCAL YEAR ENDED SEPTEMBER 30,2023 As of September 30, 2023,the Village had the following demand deposits and investments: Weighted Credit Average Rating Percent Deposits and Investments Reported Value Maturity (S&P) Distribution Demand deposits $ 281,817 1.41% Money Market 1,000,959 5.02% Florida Class 4,477,677 AAAm 22.45% Florida Safe 5,312,952 AAAm 26.64% Total Deposits 11,073,405 Certificates of deposit 1,000,000 2.4 years 5.01% US Government Agencies 7,872,270 2.4 years AA 39.47% Total Investments 8,872,270 Total Deposits and Investments $ 19,945,675 100% Interest Rate Risk- Interest rate risk exists when there is a possibility that changes in interest rates could adversely affect an investment's fair value. The Village's investment policy limits investments to the following: (1) current operating funds should have maturities of no longer than 24 months and (2) core funds shall have a final maturity of five and one-half (5.5) years or less from the date of purchase. The overall weighted average duration of principal return for the core funds shall be less than 3 years. Credit Risk- Credit risk exists when there is a possibility that the issuer or other counter-party to an investment transaction may be unable to fulfill its obligations. The Village's investment policy allows investments in U.S. Government-sponsored agencies and enterprises, commercial paper, the Florida PRIME investment pool, interlocal investment pools. The Village invests surplus funds in FLCLASS and FLSAFE Investment Pools. Both are rated by Standard & Poor's as AAAm, the highest rating for 2a7 investment pools. Concentration of Credit Risk — Maximum investment concentration ranges from 25% for other municipal bonds to 100% for US Treasuries. At September 30, 2023, the Village's investments were within the established policy levels for all investments to mitigate this risk. Custodial Credit Risk - The risk that, in the event of the failure of the counter party, the Village 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 invested in US Government Agencies held by a third party custodian and the highest rating by S&P for both local government investment pools; FLCLASS and FLSAFE. Fair value of Investments - The Village follows the provision of GASB Codification, 150: Investments, which establishes a framework for measuring the fair value of investments in a fair value hierarchy that prioritizes the inputs to valuation techniques used to measure fair value. The three levels of the fair value hierarchy under GASBC I50 are described below: 40 VILLAGE OF TEQUESTA, FLORIDA NOTES TO FINANCIAL STATEMENTS FOR THE FISCAL YEAR ENDED SEPTEMBER 30,2023 Level 1 —Investments reflect unadjusted quoted prices in active markets for identical assets. Level 2 — Investments reflect prices that are based on inputs that are either directly or indirectly observable for an asset (including quoted prices for similar assets), which may include inputs in markets that are not considered to be active. Level 3 —Investments reflect prices based upon unobservable inputs. As of September 30, 2023 the Village has the following recurring fair value investments: Quoted Prices in Significant Significant Active Markets for Observable Unobservable Identical Assets Inputs Inputs 9/30/23 (Level1) (Level2) (Level3) Fixed income U.S.Agencies $ 7,872,270 $ - $ 7,872,270 $ - Total fixed income 7,872,270 - 7,872,270 - Total investments at fair value 7,872,270 $ - $ 7,872,270 $ - Investment at net asset value(NAV) FL Class 4,477,677 FL Safe 5,312,952 Investment at net asset value(NAV) 9,790,629 Investments at cost Certificates of deposit(exempt) 1,000,000 Total investments 18,662,899 Demand Deposits 1,282,776 Total cash equivalent and investments $ 19,945,675 Investments—Public Safety Pension Trust Fund Investment Policy Statement The Public Safety 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. The Investment Policy Statement for the fiscal year ended September 30, 2023 was amended to comply with the applicable requirements of Chapter 2023-28, Laws of Florida, including Section 112.662, along with regulations adopted by the Department of Management Services. The investments of the Public Safety Pension Trust Fund were in compliance with the investment policy. Fair Value Hierarchy The Plan categorizes its fair value measurement within the fair value hierarchy established by generally accepted accounting principles. The hierarchy is based on valuation input used to measure the fair value of an asset: 41 VILLAGE OF TEQUESTA, FLORIDA NOTES TO FINANCIAL STATEMENTS FOR THE FISCAL YEAR ENDED SEPTEMBER 30,2023 Level 1 -investments reflect unadjusted quoted prices in active markets for identical assets; Level 2 - investments reflect prices that are based on inputs that are either directly or indirectly observable for an asset(including quoted prices for similar assets), which may include inputs in markets that are not considered to be active; Level 3 -investments reflect prices based upon unobservable inputs for an asset. The investment pricing transparency determines the category within the hierarchy and should not be observed at the investment risk. The custodian bank's (primary external pricing vendors) quoted prices were used to determine level classification based on the fair value hierarchy. Debt and equity securities classified as Level 1 of the fair value hierarchy are valued using quoted prices at September 30, 2023 (or the most recent market close date if the markets are closed on September 30) in active markets. This includes common stock, equity mutual funds and bond mutual funds. Debt securities are valued using pricing inputs that reflect the assumptions market participants would use to price an asset or liability and are developed based on market data obtained from sources independent of the reporting equity (Level 2). It is valued using a matrix pricing technique. Matrix pricing values securities based on the securities relationship to benchmark quoted prices. This includes U.S. Treasury bonds and notes, U.S. agencies, mortgage backed securities, municipal bonds and corporate obligations, including asset backed securities. The Real Estate Fund - this fund enters into real estate partnerships with various joint venture partners. The portfolio is valued quarterly at net asset value (NAV). Investments valued at NAV are excluded from the fair value hierarchy because the valuation is not based on actual market inputs but rather is quantified using the fund's reported NAV. The fund had no outstanding commitments. As of September 30, 2023 the Public Safety Pension Trust Fund has the following recurring fair value investments: Quoted Prices in Significant Significant Active Markets for Observable Unobservable Identical Assets Inputs Inputs 9/30/23 (Level1) (Level 2) (Level3) Equities Mutual funds equities $ 14,743,851 $ 14,743,851 Total equities 14,743,851 14,743,851 Fixed income Corporate bonds 565,929 565,929 U.S. Government bonds 1,886,743 1,886,743 U.S. Agences 1,725,377 1,725,377 Bond mutual fund 850,958 850,958 Total fixed income 5,029,007 850,958 4,178,049 Total investments at fair value 19,772,858 $ 15,594,809 $ 4,178,049 $ - Redemption Redemption Investment at net asset value(NAV) Frequency Notice Period Real Estate Fund 2,276,656 Quarterly 30 days Total investments $ 22,049,514 42 VILLAGE OF TEQUESTA, FLORIDA NOTES TO FINANCIAL STATEMENTS FOR THE FISCAL YEAR ENDED SEPTEMBER 30,2023 As of September 30, 2023, the Village of Tequesta's Public Safety Pension Trust Fund had the following demand deposits and investments: Weighted Credit Reported Average Rating Percent Percent of Value Maturity (Moody) Distribution Net Position Cash $ 46,449 0.21% % Short-Term Money Market Fund 37,500 0.17% 0.17% Total Cash and Cash Equivalents 83,949 Equities Mutual Funds 14,743,851 66.61% 66.48% Total Equities 14,743,851 Fixed Income Corporate Bonds: 5.78 years Bonds 318,264 Al 1.44% 1.44% Bonds 118,030 A2 0.53% 0.53% Bonds 129,635 A3 0.59% 0.58% U.S. Government Bonds 1,886,743 8.52% 8.51% U.S. Agencies 1,725,377 11.02 years AAA 7.80% 7.78% Bond Mutual Fund 850,958 3.84% 3.84% Total Fixed Income 5,029,007 Real Estate Fund 2,276,656 10.29% 10.27% Total investments 22,049,514 Total cash and investments $ 22,133,463 100.00% 99.81% Interest Rate Risk - 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, 2023, there were investments in mutual funds that included debt instruments in their portfolio. Credit Risk- 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 Al or Moody's P1. • At September 30, 2023, the weighted average maturity in years for each investment type is included in the preceding table and ranges from 5.78 to 11.02 years. 43 VILLAGE OF TEQUESTA, FLORIDA NOTES TO FINANCIAL STATEMENTS FOR THE FISCAL YEAR ENDED SEPTEMBER 30,2023 Concentration of Credit Risk - 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 to 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 to exceed 25% of the value at cost of the fund). Custodial Credit Risk-the risk that,in the event of the failure of the counterparty,the plan 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. • 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. Foreign Currency Risk - is the risk of an investment's value changing due to changes in currency exchange rates. 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 (denominated in U.S. dollars should not to exceed 5% of total fund). • 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, 2023, 17.88% of the fair value of the fund was invested in international funds. • All the international securities are denominated in U.S. dollars. There is no foreign currency risk. Money Weighted Rate of'Return and Target Allocation For the fiscal years ended September 30, 2023 and 2022,the overall annual money-weighted rate of return (long-term expected real rate of return) on the Public Safety Pension Plan investments (both Police Officers' and Firefighters') was 8.69% and (15.03)%respectively. The money-weighted rate of return expresses investment performance, net of investment manager and consultant expenses adjusted for the changing amounts actually invested. The long-term expected rate of return on pension plan investments, shown below by asset class, is developed using best-estimate ranges of expected future real rates of return (expected returns, net of pension plan investment expenses and inflation). 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. 44 VILLAGE OF TEQUESTA, FLORIDA NOTES TO FINANCIAL STATEMENTS FOR THE FISCAL YEAR ENDED SEPTEMBER 30,2023 Best estimates of arithmetic real rates of return for each major asset class included in the target asset allocation as well as the long-term expected real rate of return as of September 30, 2023 and 2022 are as follows: Long-Term Expected Real Target Rate of Return Asset Class Allocation Range 2023 2022 Domestic Equity 50% 45%-55% 7.5% 7.5% International Equity 15% 10%-20% 8.5% 8.5% Total Equities 65% 60%-70% Domestic Core Fixed Income 20% 15%-25% 2.5% 2.5% Diversified Fixed Income 5% 0%-10% 3.5% 3.5% Total Fixed Income 25% 20%-30% Core Real Estate 10% 5%-15% 4.5% 4.5% Investments— General Employees' Pension Trust Fund Investment Policy Statement The General Employees' 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. Investment Policy Statement for the fiscal year ended September 30, 2023 was amended to comply with the applicable requirements of Chapter 2023-28, Laws of Florida, including Section 112.662, along with regulations adopted by the Department of Management Services. Investments of the General Employees' Pension Trust Fund were in compliance with the investment policy. Fair Value Hierarchy The Plan categorizes its fair value measurement within the fair value hierarchy established by generally accepted accounting principles. The hierarchy is based on valuation input used to measure the fair value of an asset: Level 1 -investments reflect unadjusted quoted prices in active markets for identical assets; Level 2 - investments reflect prices that are based on inputs that are either directly or indirectly observable for an asset(including quoted prices for similar assets), which may include inputs in markets that are not considered to be active; Level 3 -investments reflect prices based upon unobservable inputs for an asset. The investment pricing transparency determines the category within the hierarchy and should not be observed as the investment risk. The custodian bank's (primary external pricing vendors) quoted prices were used to determine level classification based on the fair value hierarchy. 45 VILLAGE OF TEQUESTA, FLORIDA NOTES TO FINANCIAL STATEMENTS FOR THE FISCAL YEAR ENDED SEPTEMBER 30,2023 Debt and equity securities classified as Level 1 of the fair value hierarchy are valued using quoted prices at September 30, 2023 (or the most recent market close date if the markets are closed on September 30) in active markets. This includes common stock, mutual funds and fixed income funds. Debt securities are valued using pricing inputs that reflect the assumptions market participants would use to price an asset or liability and are developed based on market data obtained from sources independent of the reporting equity (Level 2). It is valued using a matrix pricing technique. Matrix pricing values securities based on the securities relationship to benchmark quoted prices. This includes U.S. Treasury bonds and notes, U.S. agencies, mortgage backed securities, municipal bonds and corporate obligations, including asset backed securities. The Real Estate Fund - this fund enters into real estate partnerships with various joint venture partners. The portfolio is valued quarterly at net asset value. Investments valued at NAV are excluded from the fair value hierarchy because the valuation is not based on actual market inputs but rather is quantified using the fund's reported NAV. The fund had no outstanding commitments. As of September 30, 2023 the General Employees' Pension Trust Fund has the following recurring fair value investments: Quoted Prices in Significant Significant Active Markets for Observable Unobservable Identical Assets Inputs Inputs 9/30/23 (Level1) (Level2) (Level3) Equities Common stocks $ 2,160,173 $ 2,160,173 $ - Mutual funds equities 3,399,944 3,399,944 Total equities 5,560,117 5,560,117 Fixed income Corporate bonds 534,339 534,339 U.S. Government bonds 346,700 346,700 U.S.Agences 242,889 242,889 Bond mutual fund 326,958 326,958 Exchange traded funds 472,860 472,860 Total fixed income 1,923,746 799,818 1,123,928 Total investments at fair value 7,483,863 $ 6,359,935 $ 1,123,928 $ - Redemption Redemption Investment at net asset value(NAV) Frequency Notice Period Real Estate Fund 864,306 Quarterly 30 days Total investments $ 8,348,169 46 VILLAGE OF TEQUESTA, FLORIDA NOTES TO FINANCIAL STATEMENTS FOR THE FISCAL YEAR ENDED SEPTEMBER 30,2023 At September 30, 2023,the Village of Tequesta's General Employees'Pension Trust Fund had the following demand deposits and investments: Weighted Credit Percent Reported Average Rating Percent of Net Value Maturity (Moody) Distribution Position Cash $ 23,660 0.27% 0.27% Short Term Money Market Fund 280,000 3.24% 3.23% Total Cash and Cash equivalents 303,660 Equities Common stocks 2,160,173 24.97% 24.94% Mutual funds 3,399,944 39.30% 39.25% Total Equities 5,560,117 Fixed Income Corporate Bonds: 1.00 years Bonds 116,948 Al 1.35% 1.35% Bonds 93,497 A2 1.08% 1.08% Bonds 95,703 A3 1.11% 1.10% Bonds 228,191 Baa 2.64% 2.63% ETF-Exchange Traded Fund 472,860 5.47% 5.46% U.S. Government Bonds 346,700 4.01% 4.00% U.S. Agencies 242,889 1.66 years AAA 2.81% 2.80% Mutual Fund 326,958 3.78% 3.77% Total Fixed Income 1,923,746 Real Estate Fund 864,306 9.99% 9.98% Total Investments 8,348,169 Total Cash and Investments $ 8,651,829 100.00% 99.89% Interest Rate Risk - 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, 2023, the weighted average maturity in years for each investment type is included in the preceding table and ranges from 1.00 to 1.66 years. Credit Risk-the risk that a debt issuer will not fulfill its obligations. 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: o Fixed income investments holding a rating in one of the four highest classifications by a major rating service. o Equities that are traded on a National Exchange. 47 VILLAGE OF TEQUESTA, FLORIDA NOTES TO FINANCIAL STATEMENTS FOR THE FISCAL YEAR ENDED SEPTEMBER 30,2023 Concentration of'CreditRisk-the risk of loss attributed to the magnitude of an investment in a single issuer. The Plan's investment policy limits exposure 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 to exceed 10% of the total fund. • Limiting investments in corporate common stock and convertible bonds not to exceed 70% of the fund assets at fair value. • Limiting investments in foreign securities not to exceed 25%of the fair value of the fund. Custodial Credit Risk — the risk that, in the event of the failure of the counterparty, the plan 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 by a third party custodian in the name of the Plan. As of September 30, 2023,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. Foreign Currency Risk - is the risk of an investment's value changing due to changes in currency exchange rates. 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 (including equities and fixed income securities)to be invested in foreign securities. • At September 30, 2023, 16.57% of the fair value of the fund was invested in international funds. • All the international securities are denominated in U.S. dollars. There is no foreign currency risk. Money Weighted Rate of Return and Target Allocation For the fiscal years ended September 30, 2023 and 2022,the overall annual money-weighted rate of return (long-term expected real rate of return) on the General Employees' Pension Plan investments was 8.58% and (15.89)% respectively. The money-weighted rate of return expresses investment performance, net of investment manager and consultant expenses adjusted for the changing amounts actually invested. The long-term expected rate of return on pension plan investments, shown below by asset class, is developed using best-estimate ranges of expected future real rates of return (expected returns, net of pension plan investment expenses and inflation). 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. 48 VILLAGE OF TEQUESTA, FLORIDA NOTES TO FINANCIAL STATEMENTS FOR THE FISCAL YEAR ENDED SEPTEMBER 30,2023 Best estimates of arithmetic real rates of return for each major asset class included in the target asset allocation as well as the long-term expected real rate of return as of September 30, 2023 and 2022 are as follows: Long-Term Expected Real Target Rate of Return Asset Class Allocation Range 2023 2022 Domestic Equity 50% 45%-55% 7.5% 7.5% International Equity 15% 10%-20% 8.5% 8.5% Total Equities 65% 60%-70% Domestic Core Fixed Income 20% 15%-25% 2.5% 2.5% Diversified Fixed Income 5% 0%-10% 3.5% 3.5% Total Fixed Income 25% 20%-30% Core Real Estate 10% 5%-15% 4.5% 4.5% C. Receivables Below is the detail of receivables for the general, water, and nonmajor governmental and enterprise funds including the applicable allowances for uncollectible accounts: Storm- Nonmajor General Water water Funds Total Leases $ 1,028,439 $ - $ - $ - $ 1,028,439 Accounts 242,513 782,175 - 173 1,024,861 Intergovernmental 286,170 459 9,571 2,996 299,196 Francise fees 63,318 - - - 63,318 Other taxes 111,148 - - - 111,148 Interest 97,693 79,079 - - 176,772 Gross receivables 1,829,281 861,713 9,571 3,169 2,703,734 Less: allowance for uncollectibles (130,839) (2,879) - - (133,718) Net Total Receivables $ 1,698,442 $ 858,834 $ 9,571 $ 3,169 $ 2,570,016 49 VILLAGE OF TEQUESTA, FLORIDA NOTES TO FINANCIAL STATEMENTS FOR THE FISCAL YEAR ENDED SEPTEMBER 30,2023 D. Capital Assets Capital assets activity for the fiscal year ended September 30, 2023, was as follows: Beginning Ending Balance Additions Deductions Balance Governmental Activities Capital assets not being depreciated/amortized: Land $ 634,017 $ $ $ 634,017 Construction-in-progress 18,750 6,774 25,524 Total Capital Assets Not Being Depreciated/Amortized 652,767 6,774 659,541 Capital assets being depreciated/amortized: Buildings 14,693,652 - 14,693,652 Improvements other than buildings 2,509,454 - 2,509,454 Infrastructure 5,265,715 179,045 5,444,760 Machinery and equipment 4,997,633 1,585,931 (596,091) 5,987,473 Intangibles - - - Other K-9 20,549 20,549 Total Capital Assets Being Depreciated/Amortized 27,487,003 1,764,976 (596,091) 28,655,888 Less accumulated depreciation/amortization for: Buildings (3,880,731) (367,341) (4,248,072) Improvements other than buildings (1,695,703) (90,316) (1,786,019) Infrastructure (1,427,025) (133,883) - (1,560,908) Machinery and equipment (3,758,458) (482,943) 596,091 (3,645,310) Intangibles - Other K-9 (13,211) (2,935) (16,146) Total Accumulated Depreciation/Amortization (10,775,128) (1,077,418) 596,091 (11,256,455) Total Capital Assets Being Depreciated/Amortized,Net 16,711,875 687,558 - 17,399,433 Governmental Activities Capital Assets,Net $ 17,364,642 $ 694,332 $ $ 18,058,974 Depreciation/amortization expense was charged to the functions/programs of the governmental activities of the Village as follows: Governmental Activities General government $ 131,138 Public safety 537,159 Transportation 184,123 Leisure services 224,998 Total Depreciation/Amortization Expense- Governmental Activities $ 1,077,418 50 VILLAGE OF TEQUESTA, FLORIDA NOTES TO FINANCIAL STATEMENTS FOR THE FISCAL YEAR ENDED SEPTEMBER 30,2023 Beginning Ending Balance Additions Deductions Balance Business-type Activities: Capital assets not being depreciated/amortized: Land $ 83,335 $ - $ - $ 83,335 Construction in progress 834,115 725,737 - 1,559,852 Total Capital Assets Not Being Depreciated/Amortized 917,450 725,737 - 1,643,187 Capital assets being depreciated/amortized: Buildings 972,980 - - 972,980 Improvements other than buildings 58,720 - - 58,720 Infrastructure 37,702,900 217,188 - 37,920,088 Machinery and equipment 2,087,582 77,162 (69,769) 2,094,975 Intangibles 48,649 - - 48,649 Total capital assets being depreciated/amortized 40,870,831 294,350 (69,769) 41,095,412 Less accumulated depreciation/amortization for: Buildings (763,935) (15,211) - (779,146) Improvements other than buildings (36,407) (2,349) - (38,756) Infrastructure (21,103,725) (715,803) - (21,819,528) Machinery and equipment (1,854,636) (93,469) 69,769 (1,878,336) Intangibles (48,649) - - (48,649) Total Accumulated Depreciation/Amortization (23,807,352) (826,832) 69,769 (24,564,415) Total Capital Assets Being Depreciated/Amortized,Net 17,063,479 (532,482) - 16,530,997 Business-type Activity Capital Assets,Net $ 17,980,929 $ 193,255 $ - $ 18,174,184 Depreciation/amortization expense charged to the water and stormwater funds of the business-type activities was $826,832. The depreciation/amortization expense breakdown by activity is as follows: Water utility $ 676,786 Stormwater 150,046 Total depreciation/amortization expence $ 826,832 51 VILLAGE OF TEQUESTA, FLORIDA NOTES TO FINANCIAL STATEMENTS FOR THE FISCAL YEAR ENDED SEPTEMBER 30,2023 E. Accrued Liabilities Accrued liabilities reported by governmental funds at September 30, 2023,were as follows: Other Total General Governmental Governmental Fund Funds Funds Salary and employee benefits $ 170,514 $ 9,391 $ 179,905 Other 12,991 - 12,991 Total Accrued Liabilities $ 183,505 $ 9,391 $ 192,896 E Pension Obligations Florida Retirement System (FRS) -a Statewide Local Government Employees'Retirement System(SLGERS) General Information. The FRS was established and administered in accordance with Chapter 121, Florida Statutes, effective December 1, 1970. Full time employees hired before January 1, 1996 are eligible to participate in the Florida Retirement System (FRS), as provided by Chapters 121 and 112, Florida Statutes, a cost-sharing, multiple-employer defined benefit plan administered by the State Board of Administration ("SBA"). 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 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 ww.dms.myflorida.com/workforce operations/retirement/publications. Plan Description: The FRS is a cost-sharing multiple-employer qualified defined benefit pension plan,with a Deferred Retirement Option Program ("DROP") for eligible employees. Benefits Provided—Benefits under the Pension Plan are computed on the basis of age, average final compensation, and service credit. For Pension Plan members enrolled before July 1, 2011: Regular class members who retire at or after age 62 with at least six years of credited service or 30 years of service regardless of age are entitled to a retirement benefit payable monthly for life, equal to 1.6% of their final average compensation based on the five highest years of salary, for each year of credited service. Vested members with less than 30 years of service may retire before age 62 and receive reduced retirement benefits. Special Risk Administrative Support class members who retire at or after age 55 with a least six years of credited service or 25 years of service regardless of age are entitled to a retirement benefit payable monthly for life, equal to 1.6% of their final average compensation based on the five highest years of salary, for each year of credited service. Special 52 VILLAGE OF TEQUESTA, FLORIDA NOTES TO FINANCIAL STATEMENTS FOR THE FISCAL YEAR ENDED SEPTEMBER 30,2023 Risk class members (sworn law enforcement officers, firefighters, and correctional officers) who retire at or after age 55 with at least six years of credited service, or with 25 years of service regardless of age, are entitled to a retirement benefit payable monthly for life, equal to 3.0%of their final average compensation based on the five highest years of salary for each year of credited service. Senior Management Service class members who retire at or after age 62 with at least six years of credited service or 30 years of service regardless of age are entitled to a retirement benefit payable monthly for life, equal to 2.0% of their final average compensation based on the five highest years of salary for each year of credited service. Elected Officers' class members who retire at or after age 62 with at least six years of credited service or 30 years of service regardless of age are entitled to a retirement benefit payable monthly for life, equal to 3.0% (3.33% for judges and justices) of their final average compensation based on the five highest years of salary for each year of credited service. For Plan members enrolled on or after July, 2011,the vesting requirement is extended to eight years of credited service for all these members and increasing normal retirement to age 65 or 33 years of service regardless of age for Regular, Senior Management Service, and Elected Officers' class members, and to age 60 or 30 years of service regardless of age for Special Risk and Special Risk Administrative Support class members. Also,the final average compensation for all these members will be based on the eight highest years of salary. As provided in Section 121.101, Florida Statutes, if the member is initially enrolled in the Pension Plan before July 1, 2011, and all service credit was accrued before July 1, 2011, the annual cost-of-living adjustment is three percent per year. If the member is initially enrolled before July 1, 2011, and has service credit on or after July 1, 2011, there is an individually calculated cost-of-living adjustment. The annual cost-of-living adjustment is a proportion of three percent determined by dividing the sum of the pre-July 2011 service credit by the total service credit at retirement multiplied by three percent. Plan members initially enrolled on or after July 1, 2011, will not have a cost-of-living adjustment after retirement. In addition to the above benefits, the DROP program allows eligible members to defer receipt of monthly retirement benefit payments while continuing employment with a FRS employer for a period not to exceed 60 months after electing to participate. Deferred monthly benefits are held in the FRS Trust Fund and accrue interest. There are no required contributions by DROP participants. Contributions — Effective July 1, 2011, both employees and employers are required to contribute to establish service credit for work performed in a regular established position. Effective July 1,2002, the Florida Legislature established a uniform contribution rate system for the FRS, covering both the Pension Plan and the Investment P1an.The uniform rates for fiscal year 2022-2023 are as follows: 53 VILLAGE OF TEQUESTA, FLORIDA NOTES TO FINANCIAL STATEMENTS FOR THE FISCAL YEAR ENDED SEPTEMBER 30,2023 Class Employee Employer(1) Total Regular 3% 10.19% 13.19% Special Risk 3% 26.11% 29.11% Special Risk Administrative Support 3% 36.93% 39.93% Elected Officers' Judges 3% 42.05% 45.05% Governor, Lt.Governor, Cabinet, Legistrators, State Attorneys, Public Defenders 3% 66.07% 69.07% Elected County, City Officers' 3% 55.28% 58.28% Senior Management Service 3% 29.85% 32.85% DROP participants - 16.94% 16.94% Reemployed Retiree (2) (2) (2) Notes: (1) These rates include the normal cost and unfunded actuarial liability contributions but do not include the 1.66 percent contribution for the Retiree Health Insurance Subsidy and the assessment of 0.06 percent for administration of the FRS Investment Plan and retirement and financial planning for members of both plans. (2) Contribution rates are dependent upon retirement class in which reemployed. The Village's total contributions to the FRS Pension Plan totaled $8,422 for the fiscal year ended September 30, 2023. Pension Liabilities, Pension Expense, Deferred Outflows of Resources, and Deferred Inflows of Resources The total pension liability for the FRS was determined by the plan's actuary and reported in the plan's GASB 67 valuation as of June 30, 2023, calculated based on the discount rate and actuarial assumptions below. The total pension liability is calculated using the Individual Entry Age Normal cost allocation method. The net pension liability was measured as of June 30, 2023. At September 30, 2023,the Village reported a liability of$99,080 for its proportionate share of the Pension Plan's net pension liability. The Village's proportionate share of the net pension liability was based on the Village's contributions for the year ended June 30, 2023 relative to the contributions made during the year ended June 30, 2022 of all participating members. At the June 30, 2023 Measurement Date, the Village's proportionate share was 0.000248651%, which was a decrease of 0.000162182%from its proportionate share measured as of June 30, 2022. 54 VILLAGE OF TEQUESTA, FLORIDA NOTES TO FINANCIAL STATEMENTS FOR THE FISCAL YEAR ENDED SEPTEMBER 30,2023 For the fiscal year ended September 30, 2023, the Village reported deferred outflow of resources and deferred inflows of resources related to pensions from the following sources: Deferred Deferred Deferred Outflows/Inflows of Resources Outflows Inflows Effect of economic/demographic gains or losses (differences between expected and actual experience) $ 9,303 $ - Effect of assumptions changes or inputs 6,459 - Changes in proportion and differences between contributions and proportionate share of contributions 6,321 252,777 Net differences between projected and actual investment earnings 4,138 - Village Pension Plan contributions subsequent to the measurement date - - Total $ 26,221 $ 252,777 There is no deferred outflows of resources related to the Pension Plan contributions subsequent to the measurement date, due to no FRS particitants at the end of the year ended September 30,2023. Other amounts reported as deferred outflows of resources and deferred inflows of resources related to the Pension Plan will be recognized in pension expense as follows: Fiscal Year Ending Amount 2024 $ (71,555) 2025 (71,439) 2026 (50,919) 2027 (30,478) 2028 (2,165) $ (226,556) Discount Rate The discount rate used to measure the total pension liability was 6.70%. The Pension Plan's fiduciary net position was projected to be available to make all projected future benefit payments of current active and inactive employees if future experience follows assumptions and the Actuarially Determined Contribution is contributed in full each year. Therefore, the discount rate for calculating the total pension liability is equal to the long-term expected rate of return. Discount rate 6.70% Long-term expected rate of return,net of investment expense 6.70% Municipal bond rate N/A 55 VILLAGE OF TEQUESTA, FLORIDA NOTES TO FINANCIAL STATEMENTS FOR THE FISCAL YEAR ENDED SEPTEMBER 30,2023 Actuarial Assumptions The actuarial assumptions that determined the total pension liability as of June 30, 2023, were based on the results of an actuarial experience study for the period July 1, 2013 —June 30, 2018. Valuation Date July 1, 2023 Measurement date June 30, 2023 Inflation 2.40% Salary increases including inflation 3.25% Mortality PUB-2010 base table varies by member category and sex, projected generationally with Scale MP-2018 details in valuation report Actuarial cost method Individual Entry Age Sensitivity Analysis The following presents the Village's portion of the net pension liability of the FRS, calculated using the discount rate of 6.70%, as well as what the FRS's net pension liability would be if it were calculated using a discount rate that is one percentage point lower (5.70%) or one percentage point higher(7.70%)than the current rate. 1% Current 1% Decrease Discount Rate Increase 5.70% 6.70% 7.70% Village's proportionate share of net pension liability $ 169,248 $ 99,080 $ 40,375 Long-Term Expected Rate of'Return The long-term expected rate of return assumption of 6.70% on consists of two building block components: 1) an inferred real (in excess of inflation) return of 4.20%, which is consistent with the 4.48% real return from the capital market outlook model developed by the FRS consulting actuary, Milliman; and 2) a long-term average annual inflation assumption of 2.40% as adopted in October 2023 by the FRS Actuarial Assumption Conference. In the opinion of the FRS consulting actuary both components and the overall 6.70% return assumption were determined to be reasonable and appropriate per Actuarial Standards of Practice. The 6.70% reported investment return assumption chosen by the 2022 FRS Actuarial Assumption Conference for funding policy purposes. The table below contains a summary of Milliman's assumptions for each of the asset class in which the plan was invested at the time based on the long-term target asset allocation. Each asset class assumption is based on a consistent set of underlying assumptions and includes an adjustment for the inflation assumption. These assumptions are not based on historical returns,but instead are based on a forward-looking capital market economic model. 56 VILLAGE OF TEQUESTA, FLORIDA NOTES TO FINANCIAL STATEMENTS FOR THE FISCAL YEAR ENDED SEPTEMBER 30,2023 Compound Annual Annual Target Arithmetic (Geometric) Standard Asset Class Allocation Return Return Deviation Cash 1.0% 2.9% 2.9% 1.1% Fixed income 19.8% 4.5% 4.4% 3.4% Global equity 54.0% 8.7% 7.1% 18.1% Real estate 10.3% 7.6% 6.6% 14.8% Private equity 11.1% 11.9% 8.8% 26.3% Strategic investments 3.8% 6.3% 6.1% 7.7% Assumed Inflation-Mean 2.4% 1.4% Pension Plan Fiduciary Net Position — Detailed information regarding the Pension Plan's fiduciary net position is available in the separately issued FRS Pension Plan and Other State-Administered Systems Comprehensive Annual Financial Report. Pavable's to the Pension Plan — At September 30, 2023 the Village had no outstanding contributions payable to the Pension Plan,both FRS and Retiree Health Insurance Subsidy(HIS). The Retiree Health Insurance Subsidy(HIS)Program Plan Description — HIS Program is a cost-sharing multiple-employer defined benefit pension plan established under Section 112.363, Florida Statutes. The Florida Legislature establishes and amends the contribution requirements and benefit terms of the HIS Program. The benefit is a monthly payment to assist eligible retirees and surviving beneficiaries of state-administered retirement systems in paying their health insurance costs and is administered by the Department of Management Services, Division of Retirement. Benefits Provided — For the fiscal year ended June 30, 2023, eligible retirees and beneficiaries received a monthly HIS payment equal to the number of years of creditable service credited at the time of retirement multiplied by$5. The minimum payment is $30 and maximum payment is $150 per month, pursuant to Section 112.363, Florida Statutes. To be eligible to receive a HIS benefit, a retiree under one of the state-administered retirement system must provide proof of eligible health insurance coverage,which may include Medicare. Contributions — For the fiscal year ended June 30, 2023, the contribution rate was 1.66% of payroll pursuant to section 112.363, Florida Statutes. HIS contributions are deposited in a separate trust fund from which HIS payments are authorized. The Village's total contributions to the HIS Plan totaled $825 for the fiscal year ended September 30, 2023. 57 VILLAGE OF TEQUESTA, FLORIDA NOTES TO FINANCIAL STATEMENTS FOR THE FISCAL YEAR ENDED SEPTEMBER 30,2023 Pension Liabilities, Pension Expense, Deferred Outflows of Resources, and Deferred Inflows of Resources Actuarial valuations for the HIS Program are conducted biennially. The July 1, 2022, HIS valuation is the most recent valuation and was used to develop the liabilities for June 30, 2023. Liabilities originally calculated as of the actuarial valuation date have been recalculated as of a later GASB Measurement Date using standard actuarial roll forward procedures. The discount rates used at the two liability measurement dates differ due to changes in the applicable municipal bond index between dates. At September 30, 2023, the Village reported a liability of$28,300 for its proportionate share of the Pension Plan's net pension liability. The Village's proportionate share of the net pension liability was based on the Village's contributions for the year ended June 30, 2023 relative to the contributions made during the year ended June 30, 2022 of all participating members. At June 30, 2023, the Village's proportionate share was 0.000178200%, which was a decrease of 0.000110161% from its proportionate share measured as of June 30,2022. The total pension liability was determined by an actuarial valuation as of the valuation date, calculated based on the discount rate and actuarial assumptions below, and was then projected to the measurement date. Any significant changes during this period have been reflected as prescribed by GASB 67. For the fiscal year ended September 30, 2023,the Village reported deferred outflows of resources and deferred inflows of resources related to pensions from the following sources: Deferred Deferred Deferred Outflows/Inflows of Resources Outflows Inflows Effect of economic/demographic gains or losses (differences between expected and actual experience) $ 414 $ 66 Effect of assumptions changes or inputs 744 2,452 Changes in proportion and differences between contributions and proportionate share of contributions - 68,218 Net differences between projected and actual investment earnings 15 - Village Pension Plan contributions subsequent to the measurement date - - Total $ 1,173 $ 70,736 There is no deferred outflows of resources related to the Pension Plan contributions subsequent to the measurement date, due to no FRS particitants at the end of the year ended September 30, 2023. Other amounts reported as deferred outflows of resources and deferred inflows of resources related to the HIS Plan will be recognized in pension expense as follows: 58 VILLAGE OF TEQUESTA, FLORIDA NOTES TO FINANCIAL STATEMENTS FOR THE FISCAL YEAR ENDED SEPTEMBER 30,2023 Fiscal Year Ending Amount 2024 $ (18,610) 2025 (16,577) 2026 (14,204) 2027 (13,160) 2028 (6,397) Thereafter (615) $ (69,563) Discount Rate The discount rate used to measure the total pension liability was 3.65%. In general, the discount rate for calculating the total pension liability under GASB 67 is equal to the single rate equivalent to discounting at the long-term expected rate of return for benefit payments prior to the projected depletion date. Because the HIS benefit is essentially funded on a pay-as-you-go basis, the depletion date is considered to be immediate. The single equivalent discount rate is equal to the municipal bond rate selected by the FRS Actuarial Assumption Conference. The discount rates used at the two dates differ due to changes in the applicable municipal bond index. Discount rate 3.65% Long-term expected rate of return,net of investment expense N/A Bond Buyer General Obligation 20-Bond Municipal Bond Index 3.65% Actuarial Assumptions The actuarial assumptions that determined the total pension liability as of June 30, 2023, were based on certain results of an actuarial experience study of the FRS for the period July 1, 2013 - June 30, 2018. Valuation Date July 1, 2022 Measurement date June 30, 2023 Inflation 2.40% Salary increases including inflation 3.25% Mortality Generational PUB-2010 with Projection Scale MP-2018; details in valuation report Actuarial cost method Individual Entry Age Sensitivity Analysis The following presents the net pension liability of the HIS, calculated using the discount rate of 3.65%, as well as what the HIS's net pension liability would be if it were calculated using a discount rate that is one percentage point lower (2.65%) or one percentage point higher (4.65%) than the current rate. 1% Current 1% Decrease Discount Rate Increase 2.65% 3.65% 4.65% Village's proportionate share of net pension liability $ 32,286 $ 28,300 $ 24,996 Pension Plan Fiduciary Net Position - Detailed information regarding the HIS Plan's fiduciary net position is available in the separately issued FRS Pension Plan and Other State-Administered Systems Comprehensive Annual Financial Report. 59 VILLAGE OF TEQUESTA, FLORIDA NOTES TO FINANCIAL STATEMENTS FOR THE FISCAL YEAR ENDED SEPTEMBER 30,2023 The Vllage of Tequesta Single-Employer Defined Benefit Pension Plans Overview: The Village maintains two single-employer defined benefit pension plans, the Public Safety Officers' Pension Trust Fund and the General Employees' Pension Trust Fund. The sole administration of and responsibility for the proper operation of the retirement system is vested in The Board of Trustees. The defined benefit pension plans do not issue stand alone financial statements. All full-time general employees who are not classified as police officers or firefighters are eligible for membership in the General Employees' Pension Plan on the date of employment. The General Employees' Pension Board consists of five Trustees. Two are legal residents of the municipality, appointed by the Village Council, and two are full time General Employee members. The fifth Trustee is selected by a majority vote of the other Trustees. The Public Safety Board consists of five Trustees. Two are legal residents of the municipality, appointed by the Village Council, one is a full time police officer member, and one is full time firefighter member. The fifth Trustee is selected by a majority vote of the other Trustees. All full-time police officers and all full-time firefighters are eligible for membership in the Public Safety Officers' Pension Plan on the date of employment. 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 separately in the financial statements, as well as the General Employee's Trust Fund (GPTF). Membership in the Village of Tequesta's defined benefit pension plans as of the actuarial valuation date of October 1, 2022: FPTF PPTF GPTF Number of: Inactive members or beneficiaries currently receiving benefits 8 4 14 Inactive members entitled to but not yet receiving benefits 1 2 10 Active members 20 19 51 Total 29 25 75 Funding Policies are presented below under each of the plans. Actuarial Assumptions and Net Pension Liability (NPL) The actuarial valuation of the liabilities for the FPTF, PPTF and GPTF as of the September 30, 2022 measurement date were determined as of the beginning of the year, October 1, 2021 (based on actuarial valuation results as reported in the October 1, 2021 actuarial valuation). Using a measurement date of September 30, 2022 allows for timelier reporting at the end of the year. These liabilities are used for GASB Statement No. 68 reporting for the reporting fiscal year ending September 30, 2023. The total pension liability for the Village's defined benefit pension plans was determined using the following actuarial methods and assumptions, applied to all prior periods included in the measurement period. Actuarially determined contribution rates are calculated as of October 1, two years prior to the end of the fiscal year in which contributions are reported. If significant changes occur during the year, such as benefit changes or changes in assumptions or methods, these would be noted in the footnotes. 60 VILLAGE OF TEQUESTA, FLORIDA NOTES TO FINANCIAL STATEMENTS FOR THE FISCAL YEAR ENDED SEPTEMBER 30,2023 FPTF PPTF GPTF Actuarial Valuation Date Oct. 1,2021 Oct. 1, 2021 Oct. 1, 2021 Measurement Date of the net pension liability Sep. 30, 2022 Sep. 30, 2022 Sep. 30, 2022 Village's Fiscal Year Ended Date for Reporting Purposes Sep. 30, 2023 Sep. 30, 2023 Sep. 30, 2023 Pension Expense Fiscal Year Ended September 30, 2023 (Based on Measurement Period Ended September 30, 2022) FPTF PPTF GPTF Service Cost $ 444,381 $ 362,053 $ 502,759 Interest on the Total Pension Liability 1,106,369 388,327 519,671 Employee Contributions (made negative for additions here) (100,398) (84,799) (181,475) Projected Earnings on Plan Investments (made negative for additions here) (1,132,012) (539,483) (585,396) Administrative Expense 31,060 36,426 43,005 Other Changes in Plan Fiduciary Net Position (Contributions Transferred from 401(a)Plan) - 116,656 - Other Changes in Total Pension Liability (Increase in State Contribution Reserve) - (116,656) - Recognition of Outflow(Inflow) of Recourses due to Liabilities 32,193 (45,462) (18,791) Recognition of Outflow(Inflow) of Recourses due to Assets 353,892 181,400 191,683 Total Pension Expense $ 735,485 $ 298,462 $ 471,456 61 VILLAGE OF TEQUESTA, FLORIDA NOTES TO FINANCIAL STATEMENTS FOR THE FISCAL YEAR ENDED SEPTEMBER 30,2023 The deferred outflow of resources, resulting from the Village's contributions to the Plans subsequent to the measurement date of September 30, 2022 are recognized as a reduction of the Village's net pension liability in the fiscal year ended September 30, 2023. The Village reported deferred outflows of resources and deferred inflows of resources related to pensions from the following sources: Fire: Deferred Outflows of Deferred Inflows of Resources Resources Difference between expected and actual experience $ 270,669 $ 77,595 Changes in assumptions 165,480 250,210 Net difference between projected and actual earnings on pension plan investments 1,756,591 - Contribution subsequent to measurement date 684,275 - Total $ 2,877,015 $ 327,805 Police: Deferred Outflows of Deferred Inflows of Resources Resources Difference between expected and actual experience $ - $ 318,988 Changes in assumptions 8,441 67,268 Net difference between projected and actual earnings on pension plan investments 863,563 - Contribution subsequent to measurement date 235,004 - Total $ 1,107,008 $ 386,256 General: Deferred Outflows of Deferred Inflows of Resources Resources Difference between expected and actual experience $ 155,795 $ 286,065 Changes in assumptions 110,533 70,489 Net difference between projected and actual earnings on pension plan investments 970,479 - Contribution subsequent to measurement date 331,982 - Total $ 1,568,789 $ 356,554 The deferred outflows of resources related to the Pension Plans contributions subsequent to the measurement date will be recognized as a reduction of the net pension liability in the fiscal year ended September 30, 2024. 62 VILLAGE OF TEQUESTA, FLORIDA NOTES TO FINANCIAL STATEMENTS FOR THE FISCAL YEAR ENDED SEPTEMBER 30,2023 Net Deferred Inflows and Deferred Outflows of Resources by Year to be Recognized in Future Pension Expenses Net Deferred Inflows and Outflows of Resources Fiscal Year Ending September 30, FPTF PPTF GPTF 2024 $ 430,929 $ 139,054 $ 192,962 2025 370,630 99,242 126,364 2026 380,025 115,247 168,026 2027 701,799 279,483 380,269 2028 (22,886) (58,259) 12,632 Thereafter 4,438 (89,019) - Total $ 1,864,935 $ 485,748 $ 880,253 Net Pension Liability (Asset) Below is a summary of components of the net pension liability (asset), by Plan, which was measured as of September 30, 2022 (measurement date in accordance with GASB Statement No. 68). Fire Police General Measurement Date September 30, 2022 2022 2022 Total Pension Liability $ 16,613,857 $ 5,630,173 $ 8,500,338 Plan Net Position 13,745,648 6,643,342 7,742,454 Net Pension Liability(Asset) $ 2,868,209 $ (1,013,169) $ 757,884 Plan Net Position as a %of Total Pension Liability 82.74% 118.00% 91.08% In accordance with GASB Statement No. 67, information as of September 30, 2023 has been disclosed: Fire Police General Measurement Date September 30, 2023 2023 2023 Total Pension Liability $ 17,622,113 $ 6,076,800 $ 9,241,492 Plan Net Position 14,826,903 7,349,357 8,661,206 Net Pension Liability(Asset) $ 2,795,210 $ (1,272,557) $ 580,286 Plan Net Position as a %of Total Pension Liability 84.14% 120.94% 93.72% 63 VILLAGE OF TEQUESTA, FLORIDA NOTES TO FINANCIAL STATEMENTS FOR THE FISCAL YEAR ENDED SEPTEMBER 30,2023 Below is a detail of the net changes in pension liability(asset): FIREFIGHTERS' PENSION TRUST CHANGES IN NET PENSION LIABILITY Increase (Decrease) Total Pension Plan Fiduciary Net Pension Liability Net Position Liability Balances at September 30,2021 $ 15,707,456 $ 16,221,717 $ (514,261) Changes for the year: Service cost 444,381 - 444,381 Interest 1,106,369 - 1,106,369 Changes of benefit terms - - - Differences between expected and actual experience 48,796 - 48,796 Changes in assumptions - - - Contributions -employer - 322,926 (322,926) Contributions -state - 200,648 (200,648) Contributions -employee - 100,398 (100,398) Net investment Income - (2,375,836) 2,375,836 'Benefit payments, including refunds of employee contributions (693,145) (693,145) - Administrative expense - (31,060) 31,060 Net Changes 906,401 (2,476,069) 3,382,470 Balances at September 30,2022 $ 16,613,857 $ 13,745,648 $ 2,868,209 64 VILLAGE OF TEQUESTA, FLORIDA NOTES TO FINANCIAL STATEMENTS FOR THE FISCAL YEAR ENDED SEPTEMBER 30,2023 POLICE OFFICERS' PENSION TRUST CHANGES IN NET PENSION ASSET Increase (Decrease) Total Pension Plan Fiduciary Net Pension Liability Net Position Asset Balances at September 30,2021 $ 5,225,838 $ 7,621,215 $ (2,395,377) Changes for the year: Service cost 362,053 - 362,053 Interest 388,327 - 388,327 Changes of benefit terms - - - Differences between expected and actual experience (148,672) - (148,672) Changes of assumptions - - - Contributions -employer - 110,759 (110,759) Contributions -employer(from state) - 209,603 (209,603) Contributions -employee - 84,799 (84,799) Net investment income - (1,149,235) 1,149,235 Benefit payments, including refunds of employee contributions (80,717) (80,717) - Administrative expense - (36,426) 36,426 Other (116,656) (116,656) - Net changes 404,335 (977,873) 1,382,208 Balances at September 30,2022 $ 5,630,173 $ 6,643,342 $ (1,013,169) 65 VILLAGE OF TEQUESTA, FLORIDA NOTES TO FINANCIAL STATEMENTS FOR THE FISCAL YEAR ENDED SEPTEMBER 30,2023 GENERAL EMPLOYEES' PENSION TRUST CHANGES IN NET PENSION LIABILITY Increase (Decrease) Total Pension Plan Fiduciary Net Pension Liability Net Position Liability Balances at September 30,2021 $ 7,609,284 $ 8,878,840 $ (1,269,556) Changes for the year: Service cost 502,759 - 502,759 Interest 519,671 - 519,671 Differences between expected and actual experience 102,847 - 102,847 Changes of Assumptions - - - Contributions -employer and State - 350,247 (350,247) Contributions -employee - 181,475 (181,475) Net investment income - (1,390,881) 1,390,881 Benefit payments, including refunds of employee contributions (234,223) (234,223) - Administrative expense - (43,004) 43,004 Net changes 891,054 (1,136,386) 2,027,440 Balances at September 30,2022 $ 8,500,338 $ 7,742,454 $ 757,884 Sensitivity of the Net Pension Liability(Asset)to Changes in the Discount Rate A single discount rate of 7.00% as of September 30, 2023, same as of September 30, 2022, was used to measure the total pension liability for the Police Officers' and Firefighters' Pension trusts. This single discount rate was based on the expected rate of return on pension plan investments of 7.00%. A discount rate of 6.50% was used to measure total pension liability for the General Employees' Pension Trust as of September 30, 2023 same as of September 30, 2022. This single discount rate was based on the expected rate of return on pension plan investments of 6.5%for both years. 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 (6.5%) 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 tables below present the plan's net pension liability, calculated using a single discount rate of 7.00% (for the Police Officers' and Firefighters' Pension trusts) and 6.50% (for the General Employees' Pension Trust) 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 (amounts in parenthesis represent a net pension asset). 66 VILLAGE OF TEQUESTA, FLORIDA NOTES TO FINANCIAL STATEMENTS FOR THE FISCAL YEAR ENDED SEPTEMBER 30,2023 Current Single 1% Discount Rate 1% Decrease Assumption Increase Fiscal Year Ended September 30, 2022 6.00% 7.00% 8.00% Firefighters' $ 4,774,365 $ 2,868,209 $ 1,257,798 Police Officers' (305,371) (1,013,169) (1,597,532) Current Single Discount Rate 1% Decrease Assumption Increase Fiscal Year Ended September 30, 2022 5.50% 6.50% 7.50% General Employees' $ 1,903,784 $ 757,884 $ (190,798) In accordance with GASB Statement No. 67, information as of September 30, 2023 has been disclosed: Current Single 1% Discount Rate 1% Decrease Assumption Increase Fiscal Year Ended September 30, 2023 6.00% 7.00% 8.00% Firefighters' $ 4,902,497 $ 2,795,210 $ 1,017,425 Police Officers' (452,872) (1,272,557) (1,950,542) Current Single Discount Rate 1% Decrease Assumption Increase Fiscal Year Ended September 30, 2023 5.50% 6.50% 7.50% General Employees' $ 1,805,799 $ 580,286 $ (443,731) rillage of Tequesta Public Safety Employees'Pension Plan (PSEPP) Summary of Plan Provisions A. Ordinances The Plan was established under the Code of Ordinances for the Village of Tequesta, Florida, Chapter 2, Article III, Division 1, Section 2-61 (b), and was most recently amended under Ordinance No. 02-19 , passed and adopted on March 14, 2019. The Plan is also governed by certain provisions of Chapters 175 and 185, Florida Statutes, Part VII, Chapter 112, Florida Statutes and the Internal Revenue Code. B. Effective Date Not currently available 67 VILLAGE OF TEQUESTA, FLORIDA NOTES TO FINANCIAL STATEMENTS FOR THE FISCAL YEAR ENDED SEPTEMBER 30,2023 C. Plan Year October 1 through September 30 D. Type of Plan Qualified,governmental defined benefit retirement plan; for GASB purposes it is a single employer plan. E. Eligibility Requirements All full-time police officers and all full-time firefighters are eligible for membership on the date of employment. F. Credited Service Service is measured as the total number of years and completed months of a year as a police officer or firefighter with the Village. No service is credited for any periods of employment for which the member received a refund of their contributions. G. Compensation Total cash remuneration for services rendered as a police officer or firefighter. For firefighters and police officers hired before October 1, 2010, overtime hours are limited to 300 hours per year, effective October 1, 2013 for firefighters and October 1, 2014 for police officers. For firefighters and police officers hired before October 1, 2010, payments for unused leave earned after October 1, 2013 for firefighters and October 1, 2014 for police officers are excluded from pensionable salary. For firefighters hired on or after October 1, 2010, fixed monthly remuneration including regular earnings, vacation pay and sick pay but excluding lump sum payments, overtime, bonuses, incentives and longevity. H. Average Final Compensation (AFC) The average of Compensation over the highest 5 years during the last 10 years of Credited Service. I. Normal Retirement Eligibility - A member may retire on the first day of the month coincident with or next following the earlier of (1) age 55 and 6 years of Credited Service (10 years of Credited Service for firefighters hired on or after August 14, 2015), or (2) age 52 and 25 years of Credited Service. Benefit-For police officers hired before February 1, 2013 and firefighters hired before August 14, 2015 (firefighters: Credited Service only prior to September 1, 201.5 : 3.0%of AFC multiplied by the first 6 years of Credited Service,plus 3.5%of AFC multiplied by the next 4 years of Credited Service,plus 4.0%of AFC multiplied by the next 5 years of Credited Service,plus 3.0%of AFC multiplied by the next 6 years of Credited Service,plus 68 VILLAGE OF TEQUESTA, FLORIDA NOTES TO FINANCIAL STATEMENTS FOR THE FISCAL YEAR ENDED SEPTEMBER 30,2023 2.0%of AFC multiplied by the next 4 years of Credited Service,plus 3.0%of AFC multiplied by all years of Credited Service over 25 years For firefighters hired before August 14, 2015, Credited Service on or after September 1, 2015: 3.0%of AFC multiplied by years of Credited Service For police officers hired on or after February 1, 2013 and firefighters hired on or after August 14, 2015: 2.75%of AFC multiplied by all years of Credited Service Normal Form ofBenefrt- 10 Years Certain and Life thereafter; other options are also available. COLA: None Supplemental Benefit - All retirees and beneficiaries receiving pension benefits will be paid a supplemental benefit equal to $20 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. J. Early Retirement Eligibility - A member may elect to retire earlier than the Normal Retirement Eligibility upon attainment of age 50 and 6 years of Credited Service (10 years of Credited Service for firefighters hired on or after August 14, 2015). Benefit - The Normal Retirement Benefit is reduced by 3.0% for each year by which the Early Retirement date precedes the Normal Retirement date. Normal Form of Benefit- 10 Years Certain and Life thereafter; other options are also available. COLA: None Supplemental Benefit - All retirees and beneficiaries receiving pension benefits will be paid a supplemental benefit equal to $20 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. K. Delayed Retirement Same as Normal Retirement taking into account compensation earned and service credited until the date of actual retirement. L. Service Connected Disability Eligibility - Any member who becomes totally and permanently disabled and unable to render useful and efficient service to the Village as a result from an act occurring in the performance of service for the Village is immediately eligible for a disability benefit. 69 VILLAGE OF TEQUESTA, FLORIDA NOTES TO FINANCIAL STATEMENTS FOR THE FISCAL YEAR ENDED SEPTEMBER 30,2023 Benefit - The accrued Normal Retirement Benefit taking into account compensation earned and service credited as of the date of disability with a minimum benefit equal to 42%of AFC. Normal Form of Benefit- 10 Years Certain and Life thereafter. COLA: None Supplemental Benefit - All retirees and beneficiaries receiving pension benefits will be paid a supplemental benefit equal to $20 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. M. Non-Service Connected Disability Eligibility - Any member who becomes totally and permanently disabled and unable to render useful and efficient service to the Village is immediately eligible for a disability benefit. Benefit - The accrued Normal Retirement Benefit taking into account compensation earned and service credited as of the date of disability with a minimum benefit equal to 25%of AFC. Normal Form of Benefit- 10 Years Certain and Life thereafter. COLA: None Supplemental Benefit - All retirees and beneficiaries receiving pension benefits will be paid a supplemental benefit equal to $20 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. N. Death in the Line of Duty Eligibility-Members are eligible for survivor benefits regardless of Credited Service. Benefit-The member's spouse or dependent child will receive the 50%of the member's AFC as of the date of death. Normal Form ofBenefat-Payable for the life of the beneficiary. COLA: None Supplemental Benefit - All retirees and beneficiaries receiving pension benefits will be paid a supplemental benefit equal to $20 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. 70 VILLAGE OF TEQUESTA, FLORIDA NOTES TO FINANCIAL STATEMENTS FOR THE FISCAL YEAR ENDED SEPTEMBER 30,2023 O. Other Pre-Retirement Death Eligibility - Members are eligible for survivor benefits after the completion of 6 or more years of Credited Service (10 years of Credited Service for firefighters hired on or after August 14, 2015). Benefit - The beneficiary will receive the actuarial equivalent of the member's accrued Normal Retirement Benefit taking into account compensation earned and service credited as of the date of death. Normal Form ofBenefat-Payable for the life of the beneficiary. COLA: None Supplemental Benefit - All retirees and beneficiaries receiving pension benefits will be paid a supplemental benefit equal to $20 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. The beneficiary of a plan member with less than 6 years of Credited Service (10 years of Credited Service for firefighters hired on or after August 14, 2015) at the time of death will receive a refund of the member's accumulated contributions. P. Post Retirement Death Benefit determined by the form of benefit elected upon retirement. Q. Optional Forms In lieu of electing the Normal Form of benefit, the optional forms of benefits available to all retirees are the Life Annuity option or the 50%, 66 2/3%, 75% and 100% Joint and Survivor options. R. Vested Termination Eligibility -A member has earned a non-forfeitable right to Plan benefits after the completion of 6 years of Credited Service (10 years of Credited Service for firefighters hired on or after August 14, 2015). Benefit - The benefit is the member's accrued Normal Retirement Benefit as of the date of termination. Benefit begins on the member's Normal Retirement date. Alternatively, members can elect a reduced Early Retirement benefit any time after age 50. Normal Form of Benefit- 10 Years Certain and Life thereafter; other options are also available. COLA: None 71 VILLAGE OF TEQUESTA, FLORIDA NOTES TO FINANCIAL STATEMENTS FOR THE FISCAL YEAR ENDED SEPTEMBER 30,2023 Supplemental Benefit - Once in pay status, all retirees and beneficiaries receiving pension benefits will be paid a supplemental benefit equal to $20 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. Members terminating employment with less than 6 years of Credited Service (10 years of Credited Service for firefighters hired on or after August 14, 2015) will receive a refund of their own accumulated contributions. S. Refunds Eligibility - All members terminating employment with less than 6 years of Credited Service (10 years of Credited Service for firefighters on or after August 14, 2015) are eligible. Optionally, vested members (those with 6 or more years of Credited Service — 10 years of Credited Service for firefighters hired on or after August 14, 2015) may elect a refund in lieu of the vested benefits otherwise due. Benefit-Refund of the member's contributions. T. Member Contributions 5%of Compensation for police officers hired before February 1, 2013 and 6% of compensation for police officers hired on or after February 1, 2013. 50/ot of compensation for firefighters through the fiscal year ending September 30, 2016; 5.5% of Compensation for firefighters beginning in the fiscal year ending September 30, 2017; thereafter, 6% of Compensation for firefighters. Employee contributions for firefighters would revert back to 5% of Compensation if the Village opts out of participation in Chapter 175. U. State Contributions Chapter 185 Premium Tax Revenue: The Village is permitted to use all annual Chapter 185 revenue as a credit toward the Required Employer Contribution and to apply half of the Chapter 185 reserve of $333,315 to reduce Required Employer Contribution. The remaining half of the Chapter 185 reserve of$333,315 is alocated to a Share Paln for police officers. Chapter 175 Premium Tax Revenue: The Village is permitted to use all annual Chapter 175 revenue as a credit toward the Required Employer Contribution and to apply the Chapter 175 reserve of $545,142 to reduce the Required Employer Contribution for the fiscal year ending September 30, 2016 through September 30, 2018, as determined by Village. V. Employer Contributions Any additional amount determined by the actuary needed to fund the plan properly according to State laws. 72 VILLAGE OF TEQUESTA, FLORIDA NOTES TO FINANCIAL STATEMENTS FOR THE FISCAL YEAR ENDED SEPTEMBER 30,2023 W. Cost of Living Increases Not Applicable X. 13th Check Not Applicable Y. Deferred Retirement Option Plan Eligibility-Plan members who have met one of the following criteria are eligible for the DROP: (1) age 55 and 6 years of Credited Service (10 years of Credited Service for firefighters hired on or after August 14, 2015), or (2) age 52 and 25 years of Credited Service. Police officers must make a written election to participate in the DROP before the 27th year of employment. Firefighters must make a written election to participate in the DROP within two years of normal retirement eligibility. Benefit - 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. Firefighters have the optional sell back of vacation and sick leave when entering the DROP. Maximum DROP Period-Police officers: The earlier of 5 years of participation in the DROP or 30 years of employment. Firefighters: 5 years. Interest Credited - 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 interest rate will not be less than 0%nor greater than 7.5%. Normal Form ofBenefat-Lump Sum; other options are also available. COLA: None Z. Other Ancillary Benefits There are no ancillary retirement type benefits not required by statutes but which might be deemed a Village of Tequesta Public Safety Officers' Pension Trust Fund liability if continued beyond the availability of funding by the current funding source. AA. Changes from Previous Valuation None The Firefighters' 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, 2023. 73 VILLAGE OF TEQUESTA, FLORIDA NOTES TO FINANCIAL STATEMENTS FOR THE FISCAL YEAR ENDED SEPTEMBER 30,2023 FIREFIGHTERS' PENSION TRUST FUND STATEMENT OF FIDUCIARY NET POSITION SEPTEMBER 30,2023 Assets Cash and cash equivalents $ 56,078 Investments Equities 9,851,037 Fixed income 3,360,108 Real Estate Funds 1,521,137 Total investments 14,732,282 Contributions receivable 34,412 Accrued interest receivable 15,802 Total Assets 14,838,574 Liabilities Accounts payable 11,671 Total Liabilities 11,671 Net Position Restricted for Pension Benefits $ 14,826,903 74 VILLAGE OF TEQUESTA, FLORIDA NOTES TO FINANCIAL STATEMENTS FOR THE FISCAL YEAR ENDED SEPTEMBER 30,2023 FIREFIGHTERS' PENSION TRUST FUND STATEMENT OF CHANGES IN FIDUCIARY NET POSITION FOR THE FISCAL YEAR ENDED SEPTEMBER 30,2023 Additions Contributions: State of Florida $ 244,737 Employer 439,538 Employee 109,715 Total Contributions 793,990 Investment earnings Net appreciation in fair value of investment 889,971 Gain on sale of investments 93,505 Interest and dividends 296,502 Total investment earnings 1,279,978 Less investment expenses (40,424) Net investment earnings 1,239,554 Total Additions 2,033,544 Deductions Benefits paid 355,759 Refund of contributions 563,343 Administrative expenses 33,187 Total Deductions 952,289 Change in Net Position 1,081,255 Net Position Restricted for Pension Benefits Beginning of year 13,745,648 End of year $ 14,826,903 75 VILLAGE OF TEQUESTA, FLORIDA NOTES TO FINANCIAL STATEMENTS FOR THE FISCAL YEAR ENDED SEPTEMBER 30,2023 The Police 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, 2023. POLICE OFFICERS' PENSION TRUST FUND STATEMENT OF FIDUCIARY NET POSITION SEPTEMBER 30,2023 Assets Cash and cash equivalents $ 27,871 Investments Equities 4,892,814 Fixed income 1,668,899 Real Estate Funds 755,519 Total investments 7,317,232 Contributions receivable 5,058 Accrued interest receivable 7,854 Total Assets 7,358,015 Liabilities Accounts payable 8,658 Total Liabilities 8,658 Net Position Restricted for Pension Benefits $ 7,349,357 76 VILLAGE OF TEQUESTA, FLORIDA NOTES TO FINANCIAL STATEMENTS FOR THE FISCAL YEAR ENDED SEPTEMBER 30,2023 POLICE OFFICERS' PENSION TRUST FUND STATEMENT OF CHANGES IN FIDUCIARY NET POSITION FOR THE FISCAL YEAR ENDED SEPTEMBER 30,2023 Additions Contributions: State of Forida $ 108,867 Employer 126,138 Employee 92,612 Total Contributions 327,617 Investment earnings Net appreciation in fair value of investments 422,140 Gain on sale of investments 45,103 Interest and dividends 144,855 Total investment earnings 612,098 Less investment expenses (27,534) Net investment earnings 584,564 Total Additions 912,181 Deductions Benefits paid 129,304 Refund of contributions 43,675 Administrative expenses 33,187 Total Deductions 206,166 Change in Net Position 706,015 Net Position Restricted for Pension Benefits Beginning of year 6,643,342 End of year $ 7,349,357 77 VILLAGE OF TEQUESTA, FLORIDA NOTES TO FINANCIAL STATEMENTS FOR THE FISCAL YEAR ENDED SEPTEMBER 30,2023 General Employees'Pension Plan A. Ordinances The Plan was established under the Code of Ordinances for the Village of Tequesta, Florida, Chapter 2,Article III, Division 1, Section 2-61 (a), and was most recently amended under Ordinance No. 12-19. The Plan is also governed by certain provisions of Part VII, Chapter 112, Florida Statutes and the Internal Revenue Code. B. Effective Date December 11, 2003 C. Plan Year October 1 through September 30 D. Type of Plan Qualified, governmental defined benefit retirement plan; for GASB purposes it is a single employer plan. E. Eligibility Requirements All full-time general employees who are not classified as police officers or firefighters are eligible for membership on the date of employment. F. Credited Service Service is measured as the period of contenious service as a general employee with the Village. No service is credited for any periods of employment for which the member received a refund of their contributions. G.Compensation Base compensation including regular earnings, vacation pay, sick pay, plus all tax-deferred items of income,but excluding any lump sum payments, overtime,bonuses and longevity bonus. H.Average Final Compensation (AFC) The average of Compensation over the highest 5 years during the last 10 years of Credited Service; does not include lump sum payments of unused leave. 78 VILLAGE OF TEQUESTA, FLORIDA NOTES TO FINANCIAL STATEMENTS FOR THE FISCAL YEAR ENDED SEPTEMBER 30,2023 I. Normal Retirement Eligibility-A member may retire on the first day of the month coincident with or next following the earlier of (1) age 62, or (2) 30 years of Credited Service regardless of age. Benefit - 2.0% of AFC multiplied by Credited Service with a maximum benefit equal to 100% of AFC. Normal Form of Benefit- 10 Years Certain and Life thereafter; other options are also available. COLA: None J. Early Retirement Eligibility - A member may elect to retire earlier than the Normal Retirement Eligibility upon attainment of age 50 and 6 years of Credited Service. Benefit - The Normal Retirement Benefit is reduced by 5.0% for each year by which the Early Retirement date precedes the Normal Retirement date. Normal Form of Benefit- 10 Years Certain and Life thereafter; other options are also available. COLA: None K.Delayed Retirement Same as Normal Retirement taking into account compensation earned and service credited until the date of actual retirement. L. Service Connected Disability Eligibility-Any member who becomes totally and permanently disabled and unable to render useful and efficient service to the Village as a result from an act occurring in the performance of service for the Village is immediately eligible for a disability benefit. Benefit -The accrued Normal Retirement Benefit taking into account compensation earned and service credited as of the date of disability with a minimum benefit equal to 42%of AFC. Normal Form of Benefit- 10 Years Certain and Life thereafter. COLA: None 79 VILLAGE OF TEQUESTA, FLORIDA NOTES TO FINANCIAL STATEMENTS FOR THE FISCAL YEAR ENDED SEPTEMBER 30,2023 M. Non-Service Connected Disability Eligibility -Any member who has 6 years of Credited Service and becomes totally and permanently disabled and unable to render useful and efficient service to the Village is immediately eligible for a disability benefit. Benefit -The accrued Normal Retirement Benefit taking into account compensation earned and service credited as of the date of disability with a minimum benefit equal to 25%of AFC. Normal Form of Benefit- 10 Years Certain and Life thereafter. COLA: None N. Death in the Line of Duty Eligibility - Members are eligible for survivor benefits after the completion of 6 or more years of Credited Service. Benefit - The beneficiary will receive the member's accrued Normal Retirement Benefit taking into account compensation earned and service credited as of the date of death. The benefit is payable at the member's Normal Retirement date. Normal Form of Benefit- 10 Years Certain COLA: None The beneficiary of a plan member with less than 6 years of Credited Service at the time of death will receive a refund of the member's accumulated contributions with interest. 0.Other Pre-Retirement Death Eligibility - Members are eligible for survivor benefits after the completion of 6 or more years of Credited Service. Benefit - The beneficiary will receive the member's accrued Normal Retirement Benefit taking into account compensation earned and service credited as of the date of death. The benefit is payable at the member's Normal Retirement date. Normal Form of Benefit- 10 Years Certain COLA: None The beneficiary of a plan member with less than 6 years of Credited Service at the time of death will receive a refund of the member's accumulated contributions with interest. P. Post Retirement Death Benefit determined by the form of benefit elected upon retirement. 80 VILLAGE OF TEQUESTA, FLORIDA NOTES TO FINANCIAL STATEMENTS FOR THE FISCAL YEAR ENDED SEPTEMBER 30,2023 Q. Optional Forms In lieu of electing the Normal Form of benefit,the optional forms of benefits available to all retirees are the Life Annuity option or the 50%, 66 2/3%, 75%and 100%Joint and Survivor options. R. Vested Termination Eligibility - A member has earned a non-forfeitable right to Plan benefits after the completion of 6 years of Credited Service. Benefit - The benefit is the member's accrued Normal Retirement Benefit as of the date of termination. Benefit begins on the member's Normal Retirement date. Alternatively, members can elect a reduced Early Retirement benefit any time after age 50. Normal Form of Benefit- 10 Years Certain and Life thereafter; other options are also available. COLA: None Members terminating employment with less than 6 years of Credited Service will receive a refund of their own accumulated contributions with interest. S. Refunds Eligibility - All members terminating employment with less than 6 years of Credited Service are eligible. Optionally, vested members (those with 6 or more years of Credited Service) may elect a refund in lieu of the vested benefits otherwise due. Benefit- Refund of the member's contributions with interest. Interest is currently credited at a rate of 3%. T. Member Contributions 5%of Compensation U. Employer Contributions Any additional amount determined by the actuary needed to fund the plan properly according to State laws. V. Cost of Living Increases Not Applicable W. 13th Check Not Applicable 81 VILLAGE OF TEQUESTA, FLORIDA NOTES TO FINANCIAL STATEMENTS FOR THE FISCAL YEAR ENDED SEPTEMBER 30,2023 X.Deferred Retirement Option Plan Not Applicable Y. Other Ancillary Benefits There are no ancillary retirement type benefits not required by statutes but which might be deemed a Village of Tequesta General Employees' Pension Trust Fund liability if continued beyond the availability of funding by the current funding source. Z. Changes from Previous Valuation There have been no changes since the last valuation. The General 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 fiscal year ended September 30, 2023. GENERAL EMPLOYEES' PENSION TRUST FUND STATEMENT OF FIDUCIARY NET POSITION SEPTEMBER 30,2023 Assets Cash and cash equivalents $ 303,660 Investments Equities 5,560,117 Fixed income 1,923,746 Real Estate Funds 864,306 Total investments 8,348,169 Contributions receivable 10,300 Accrued interest receivable 13,239 Total Assets 8,675,368 Liabilities Accounts payable 14,162 Total Liabilities 14,162 Net Position Restricted for Pension Benefits $ 8,661,206 82 VILLAGE OF TEQUESTA, FLORIDA NOTES TO FINANCIAL STATEMENTS FOR THE FISCAL YEAR ENDED SEPTEMBER 30,2023 GENERAL EMPLOYEES' PENSION TRUST FUND STATEMENT OF CHANGES IN FIDUCIARY NET POSITION FOR THE FISCAL YEAR ENDED SEPTEMBER 30,2023 Additions Contributions: Employer $ 331,983 Employee 196,672 Total Contributions 528,655 Investment earnings Net appreciaton in fair value of investments 565,890 Gain on sale of investments 16,531 Interest and dividends 184,641 Total investment earnings 767,062 Less investment expenses (47,561) Net investment earnings 719,501 Miscellaneous - Total Additions 1,248,156 Deductions Benefits paid 236,372 Refund of contributions 36,696 Administrative expenses 56,336 Total Deductions 329,404 Change in Net Position 918,752 Net Position Restricted for Pension Benefits Beginning of year 7,742,454 End of year $ 8,661,206 83 VILLAGE OF TEQUESTA, FLORIDA NOTES TO FINANCIAL STATEMENTS FOR THE FISCAL YEAR ENDED SEPTEMBER 30,2023 The following summarizes the pension related amounts for the pension plans as of the indicated measurement date: Deferred Deferred Pension Measurement Net Pension Net Pension Outflow of Inflow of Expense Date Asset Liability Resources Resources (Benefit) General Employees'Pension Trust Fund 9/30/22 $ - $ 757,884 $ 1,568,789 $ 356,554 $ 471,456 Firefighters Pension Trust Fund 9/30/22 - 2,868,209 2,877,015 327,805 735,485 Police Pension Trust Fund 9/30/22 1,013,169 - 1,107,008 386,256 298,462 FRS 6/30/23 - 99,080 26,221 (252,777) 20,521 HIS 6/30/23 - 28,300 1,173 (70,736) 10,624 Total $ 1,013,169 $ 3,753,473 $ 5,580,206 $ 747,102 $ 1,536,548 Vllage of Tequesta Defined Contribution Plan The Village Single-Employer Defined Contribution Plan (the Plan) was established on February 1, 2013 with an effective date of March 1, 2013. The Plan is a 401(a) money purchase plan in the form of the Empower Retirement Governmental Money Purchase Plan and Trust (The Plan) 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 Plan and shall not be diverted to any other purpose. The employer's beneficial ownership of Plan assets held in the Empower Retirement Trust 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 Empower Retirement Trust incidental to the administration of the Plan. The Village serves as Trustee under the Plan. In a defined contribution plan, benefits depend solely on amounts contributed to the Plan plus investment earnings. The Plan covered the Police Chief and Assistant Police Chief. Employees must designate a mandatory participation contribution between the range of 1% to 12% 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 contributes 10% of compensation. Employees are immediately vested in the Plan. Plan provisions are established and may be amended by the Village. 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, 2023 was $235,034. Employee contributions to the Plan for fiscal year ended September 30, 2023 were $13,613; the Village's contributions were $29,194. 84 VILLAGE OF TEQUESTA, FLORIDA NOTES TO FINANCIAL STATEMENTS FOR THE FISCAL YEAR ENDED SEPTEMBER 30,2023 G. Other Postemployment Benefits (OPEB) rillage of Tequesta's Other Postemployment Benefits Plan Plan description. The Village of Tequesta provides health insurance benefits to its retired employees through a single-employer plan administered by the Village. Pursuant to the provisions of Section 112.0801, Florida Statutes, former employees who retire from the Village and eligible dependents may continue to participate in the Village's fully-insured benefit plan for medical insurance coverage. The Village subsidizes the premium rates paid by retirees by allowing them to participate in the plan at reduced or blended group (implicitly subsidized) premium rates for both active and retired employees. These rates provide an implicit subsidy for retirees because, on an actuarial basis, their current and future claims are expected to result in higher costs to the plan on average than those of active employees. The benefits provided under this defined benefit plan are provided until the retiree's attainment of age 65 (or until such time at which retiree discontinues coverage under the Village sponsored plans,if earlier). Funding Policy. The Village's Other Post-Employment Benefits are unfunded (pay-as-you-go basis). That is, the Village does not have a separate Trust Fund to make contributions to advance-fund the obligation. Current and future retirees are required to pay 100% of the blended premium to continue coverage under the Village's group health insurance program. Summary of Membership Information. The following table provides a summary of the number of participants in the plan at the measurement date of September 30, 2022: Inactive members or beneficiaries currently receiving benefits 6 Inactive members entitled to but not yet receiving benefits 0 Active members 92 Total 98 OPEB Liability,Expense,Deferred Outflows of Resources, and Deferred Inflows of Resources The Village recognizes the OPEB liability and the OPEB expense in the financial statements, along with the related deferred outflows and inflows of resources. The OPEB liability is the difference between the total OPEB liability and the plan's fiduciary net position. Since the plan is currently unfunded,the net OPEB liability is equal to and reported as total OPEB liability. The OPEB expense recognize each fiscal year is equal to the change in the total OPEB liability from the beginning of the year, not including the impact of the employer contributions, adjusted for deferred recognition of the liability. At September 30, 2023, the Village reported an OPEB liability of $820,761 that is based on the actuarial valuation results as reported in the September 30, 2021 actuarial valuation report and rolled forward to the September 30, 2022 measurement date. 85 VILLAGE OF TEQUESTA, FLORIDA NOTES TO FINANCIAL STATEMENTS FOR THE FISCAL YEAR ENDED SEPTEMBER 30,2023 For the fiscal year ended September 30, 2023,the Village recognized OPEB expense of$131,022. Total OPEB Liability- Beginning (September 30,2021) $ 913,400 Service cost 79,520 Interest on the Total OPEB Liability 21,209 Changes in assumptions and other inputs (144,458) Benefit payments (48,910) Net change in Total OPEB Liability (92,639) Total OPEB Liability- Ending (September 30,2022) $ 820,761 hi addition, the Village reported an deferred outflows and deferred inflows of resources related to OPEB from the following sourses: Deferred Outflows of Deferred Inflows of Resources Resources Changes in assumptions and other inputs $ 317,623 $ 128,042 Benefit payments after the measurement date 60,216 - Total $ 377,839 $ 128,042 The deferred outflows of resources related to the contributions subsequent to the measurement date will be recognized as a reduction of the total OPEB liability in the fiscal year ended September 30, 2024. Other amounts reported as deferred outflows of resources and deferred inflows of resources related to the OPEB will be recognized in future OPEB expenses as follows: Fiscal Year Ending Amount 2024 $ 30,293 2025 30,293 2026 30,293 2027 30,293 2028 30,293 Thereafter 38,116 $ 189,581 Actuarial methods, assumptions and other inputs. The total OPEB liability was determined using actuarial assumptions outlined below. Valuation Date September 30, 2021 Measurement Date September 30, 2022 Roll forward procedures The total OPEB liability was rolled forward twelve months from the Valuation Date to the Measurement Date using standard actuarial techniques. Actuarial Cost Method Entry age normal Inflation 2.25 % Discount Rate 4.40% Salaty Increase For participants in the General Employees Plan, 4.75%-5.50% per year, including inflation. For participants in the Public Sfety Plan, 6.0% per year, including inflation. 86 VILLAGE OF TEQUESTA, FLORIDA NOTES TO FINANCIAL STATEMENTS FOR THE FISCAL YEAR ENDED SEPTEMBER 30,2023 Retirement Age Retirement rates used in the October 1, 2021 pension actuarial valuations of the General and Public Safety employees. Mortality Mortality rates are the same as used in the July 1,2021 acruarial valuation of the Florida Retirement System. These rates were taken from adjusted Pub-2010 mortality tables published by the SOA with generational mortality improvements using scale MP-2018. Adjustments to reference tables are based on the results of a statewide experience study covering the period 2013 through 2018. Healthcare Cost Trend Based on the Getzen Model, with trends starting at 6.30% for 2022, 5.75% Rates for 2023, and then gradually decreasing to an ultimate trend rate of 3.75%. Aging factors Based on the 2013 SOA Study "Healt Care Cost-From Birth to Death". Expenses Administrative expenses are included in the per capita health costs. Other infornation Notes The following assumption changes have been reflected in the Schedule of Changes in the Total OPEB Liability for the measurement period ending September 30, 2022: - The discount rate was changed from 2.19% as of the beginning of the measurement period to 4.40%as of September 30, 2022. There were no benefit changes during the year. Projections of benefits for financial reporting purposes are based on the substantive plan (the plan as understood by the employer and plan members) and include the types of benefits provided at the time of each calculation and the historical pattern of sharing of benefit costs between the employer and plan members to that point. The methods and assumptions used include techniques that are designed to reduce the effects of short-term volatility in actuarial accrued liabilities and the actuarial value of assets, consistent with the long-term perspective of the calculations. Discount Rate For plans that do not have formal assets, the discount rate should equal to the tax-exempt municipal bond rate based on an index of 20-year general obligation bonds with an average AA credit rating as of the measurement date. For the purpose of this valuation, the municipal bond rate is 4.40% (based on the daily rate closest to but not later than the measurement date of the "Fidelity 20-Year Municipal GO AA Index"). The discount rate was 2.19%as of the beginning of the measurement year. Sensitivity of'Total OPEB Liability Regarding the sensitivity of the total OPEB liability to changes in the discount rate, the following presents the plan's total OPEB liability, calculated using a discount rate of 4.40%, as well as what the plan's total OPEB liability would be if it were calculated using a discount rate that is one percent lower or one percent higher: Sensitivity of Total OPEB Liability to the Discount Rate Assumption Current Discount Rate 1%Decrease Assumption 1%Increase 3.40% 4.40% 5.40% Village's OPEB liability $ 882,503 $ 820,761 $ 764,296 87 VILLAGE OF TEQUESTA, FLORIDA NOTES TO FINANCIAL STATEMENTS FOR THE FISCAL YEAR ENDED SEPTEMBER 30,2023 Regarding the sensitivity of the total OPEB liability to changes in the healthcare cost trend rates, the following presents the plan's total OPEB liability, calculated using the assumed trend rates as well as what the plan's total OPEB liability would be if it were calculated using a trend rate that is one percent lower or one percent higher: Sensitivity of Total OPEB Liability to the Healthcare Cost Trend Rate Assumption Current Healthcare Cost 1%Decrease Trend Rate Assumption 1%Increase Village's OPEB liability $ 741,891 $ 820,761 $ 912,213 IL Construction and Other Commitments The Village has active construction projects as of September 30, 2023, including fire rescue vehicle, road improvements, and various water, stormwater projects. At year end, The Village had the following significant related to uncompleted contacts for construction and equipment: Description Remaining Commitment Governmental Activities Major funds General Fund $ 831,382 Total Major Funds 831,382 Non-Major Funds 630,959 Total Governmental Activities $ 1,462,341 Business-type Activities Major funds Water Utility(variety of projects) $ 2,851,883 Total Major Funds 2,851,883 Non-Major Funds - Stormwater(variety of projects) 333,139 Total Business-type Activities $ 3,185,022 All commitments are financed from existing Village resources. Village uses encumbrance accounting and,therefore, construction and commitments noted above represent outstanding encumbrances at September 30, 2023. 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. 88 VILLAGE OF TEQUESTA, FLORIDA NOTES TO FINANCIAL STATEMENTS FOR THE FISCAL YEAR ENDED SEPTEMBER 30,2023 L Contracted Services—Refuse and Recycling Collection The Village's agreement with Waste Management, Inc. of Florida is for initial term for a period of eight years beginning October 1, 2017 and ending September 30, 2025 with optional renewal for one additional five year period. 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 annual change in the collection component is determined using the Water, Sewer, and Trash Collection CPI published monthly by The Bureau of Labor Statistics during the most recent previous twelve consecutive months period beginning on April 1 and ending March 31. J. Risk Management The Village is exposed to various risks of loss related to torts,theft of, damage to and destruction of assets, errors and omissions, injuries to employees and natural disasters. While the Village cannot always anticipate the areas in which potential claims may arise, it purchases commercial insurance to protect against areas of possible exposure connected to municipal entities such as property, liability, automobile, workers' compensation, crime, storage tank, inland marine, statutory accidental death and dismemberment, firefighter cancer program coverage, and railroad coverage. Deductibles and limits vary by coverage and are secured based upon the Village's tolerance of risk retention in each area. 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 in our care, custody and control 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 property claims up to $100,000 via a policy deductible. 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 2022/2023 resulted in a total refund to the Village of$6,273, due to payroll alterations that impacted the workers'compensation premium. 89 VILLAGE OF TEQUESTA, FLORIDA NOTES TO FINANCIAL STATEMENTS FOR THE FISCAL YEAR ENDED SEPTEMBER 30,2023 K. Financed Purchases Financed Purchase-Computer Equipment The Village entered into a master agreement with Truist Bank, a North Carolina banking corporation in the amount of $168,390 with funding on February 18, 2021 for the financing of computer hardware equipment. The applicable interest rate is 1.67% and interest and principal payments are due annually on February 18th. This is a three (3) year contract with three (3) payments maturing at February 18, 2024. The following is the schedule of the of the future minimum payments at September 30, 2023: Fiscal Year Ending September 30: Principal Interest Total 2024 $ 57,062 $ 953 $ 58,015 Total $ 57,062 $ 953 $ 58,015 Financed Purchase-Police Fleet The Village entered into agreement with Enterprise Fleet Management Trust in the amount of $105,305 with funding on September 18, 2020 for the financing of three Dodge Durango vehicles. The applicable interest rate is 3.15% and interest and principal payments are due monthly. This is a five (5) year contract with sixty(60)payments. The following is the schedule of the of the future minimum payments at September 30, 2023: Fiscal Year Ending September 30: Principal Interest Total 2024 $ 49,195 $ 4,590 $ 53,785 2025 51,661 4,590 56,251 2026 25,840 1,975 27,815 Total $ 126,696 $ 11,155 $ 137,851 Financed Purchase-Fire Pumper The Village entered into agreement with SunTrust in the amount of $432,844 with funding on October 29, 2013 for the financing of a fire pumper. It is paid off at fiscal year ending 9/30/2023. L. Long-Term Liabilities Promissory Notes The Village 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 5 to 16 years and have interest rates from 2.18%to 3.69%per year. The outstanding notes from direct borrowings and direct placements related to governmental activities of $6,405,000 contain events of default and remedies whereby failure of the Village to pay the principal and interest on any debt when due or failure to observe and perform any covenant or condition applicable to the various Village obligations, constitutes an "event of default." Upon the occurrence of any event of default,the noteholder may declare all outstanding amounts become immediately due. 90 VILLAGE OF TEQUESTA, FLORIDA NOTES TO FINANCIAL STATEMENTS FOR THE FISCAL YEAR ENDED SEPTEMBER 30,2023 The Village's outstanding notes from direct borrowings related to its business-type activities of $1,952,564 are secured by pledged revenues of the water utility system or by a pledge of a covenant to budget and appropriate non-ad valorem revenues. These notes contain (1) a provision that, in an event of default, the timing of repayment of outstanding amounts may become immediately due if pledged revenues during the fiscal year are less than 120% of debt service requirements for that year and (2) a provision that if the Village is unable to make payment, outstanding amounts may become due immediately. The Notes outstanding at September 30, 2023 are as follows: Signed Original Interest Final Outstanding Promissory Notes Payable Date Borrowing Rate Maturity 9/30/2023 Government Activities Capital Improvements/Rec.Building 1/21/2021 $ 6,890,000 2.18% 10/01/2040 $ 6,405,000 Total Government Activities $ 6,405,000 Business-type Activities Public Improvement(Refunding) 7/14/2008 6,554,935 3.69% 3/1/2028 $ 1,952,564 Total Business-type Activities $ 1,952,564 Legal Debt Margin The Village is subject to a bonded debt limitation of 10% of total assessed value of taxable real property. The final gross taxable value at September 30, 2023 was $1,469,500,779. As of September 30, 2023 the Village did not exceed the debt limit of$146,950,078. Changes in Long-Term Liabilities Changes in the Village's long-term liabilities for the fiscal year ended September 30, 2023 are as follows: Governmental Activities Beginning Ending Due Within Balance Additions Deletions Balance One Year Governmental Activities Note Payable-2021 $ 6,693,000 $ - $ 288,000 $ 6,405,000 $ 294,000 Financed purchases 336,478 - 152,720 183,758 106,257 Compensated absences 774,369 105,512 43,108 836,773 123,000 Total Governmental Activities $ 7,803,847 $ 105,512 $ 483,828 $ 7,425,531 $ 523,257 * For governmental activities,the liability for compensated absences and pension liabilities are liquidated by the general fund. Business-type Activities Beginning Ending Due Within Balance Additions Deletions Balance One Year Business-type Activities Note Payable(2008) $ 2,344,386 $ - $ 391,822 $ 1,952,564 $ 406,556 Compensated absences 143,902 19,779 35,988 127,693 25,000 Total Business-type Activities $ 2,488,288 $ 19,779 $ 427,810 $ 2,080,257 $ 431,556 91 VILLAGE OF TEQUESTA, FLORIDA NOTES TO FINANCIAL STATEMENTS FOR THE FISCAL YEAR ENDED SEPTEMBER 30,2023 The debt service requirements for the Village's notes are as follows: Governmental Activities Fiscal Year Ending Promissory Notes September 30: Principal Interest Total 2024 $ 294,000 $ 136,424 $ 430,424 2025 301,000 129,939 430,939 2026 307,000 123,312 430,312 2027 314,000 116,543 430,543 2028 321,000 109,621 430,621 2029-2041 4,868,000 721,863 5,589,863 Total $ 6,405,000 $ 1,337,702 $ 7,742,702 Business-type Activities Fiscal Year Ending Promissory Notes September 30: Principal Interest Total 2024 $ 406,556 $ 64,977 $ 471,533 2025 420,915 49,309 470,224 2026 437,238 33,273 470,511 2027 455,564 16,563 472,127 2028 232,291 1,819 234,110 Total $ 1,952,564 $ 165,941 $ 2,118,505 Total Primary Government Debt Fiscal Year Ending Total Primary Government Debt September 30: Principal Interest Total 2024 $ 700,556 $ 201,401 $ 901,957 2025 721,915 179,248 901,163 2026 744,238 156,585 900,823 2027 769,564 133,106 902,670 2028 553,291 111,440 664,731 2029-2041 4,868,000 721,863 5,589,863 Total $ 8,357,564 $ 1,503,643 $ 9,861,207 92 VILLAGE OF TEQUESTA, FLORIDA NOTES TO FINANCIAL STATEMENTS FOR THE FISCAL YEAR ENDED SEPTEMBER 30,2023 M. Fund Balance 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 three months of general fund operating expenditures (25%). 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. At September 30, 2023 the unassigned fund balance of the general fund was 36.04% and is above the minimum target level. It is a 6.07%increase compared to the prior fiscal year. N. Interfund Transfers The composition of interfund transfers for the fiscal year ended September 30, 2023 is as follows: Transfers In Capital Capital Stormwater Improvement Fund Projects Fund Fund Total Transfers Out (1) (2) (3) General Fund $ 873,583 $ 294,895 $ 405,500 $ 1,573,978 Capital Improvement Fund $ - $ 111,030 $ 111,030 Total Interfund Transfers $ 873,583 $ 294,895 $ 516,530 $ 1,685,008 (1) Transfer is to restrict infrastructure surtax and utility tax to fund capital projects and improvements (2) Transfer of funds to fund specific capital projects. (3) Transfer portion of ifrastructure surtax funds for qualified infrastructure projects and improvements. O. Joint Ventures 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. 93 r' REQUIRED SUPPLEMENTARY INFORMATION VILLAGE OF TEQUESTA,FLORIDA REQUIRED SUPPLEMENTARY INFORMATION BUDGETARY COMPARISON SCHEDULE GENERAL FUND FOR THE FISCAL YEAR ENDED SEPTEMBER 30,2023 Variance with Final Budget Budgeted Amounts Actual Positive Original Final Amounts (Negative) Revenues Ad valorem taxes $ 9,401,670 $ 9,401,670 $ 9,530,215 $ 128,545 Other taxes 1,979,760 2,048,268 2,365,480 317,212 Charges for services 1,597,386 1,597,386 1,620,248 22,862 Intergovernmental 903,855 903,855 1,110,601 206,746 Intragovernmental 863,074 863,074 863,074 - Licenses and permits 1,000 1,000 8,710 7,710 Franchise fees 484,710 484,710 607,485 122,775 Rents and royalties 264,262 264,262 220,950 (43,312) Miscellaneous 20,625 20,625 35,544 14,919 Fines and forfeitures 18,877 18,877 13,050 (5,827) Grants,contributions and donations 90,750 193,050 303,628 110,578 Investment earnings 110,488 136,788 484,825 348,037 Total Revenues 15,736,457 15,933,565 17,163,810 1,230,245 Expenditures Council 80,832 80,832 63,630 17,202 Manager 318,325 324,325 323,116 1,209 Human resources 409,148 414,448 404,178 10,270 Clerk 415,815 415,815 382,766 33,049 Finance 755,922 749,922 741,073 8,849 Legal 180,000 230,000 228,972 1,028 Comprehensive planning 229,540 287,315 285,688 1,627 General government 232,565 223,565 224,492 (927) Information technology 480,271 573,571 573,091 480 Police 3,509,439 3,526,489 3,513,993 12,496 Code enforcement 104,789 89,789 68,151 21,638 Fire 4,531,013 4,550,672 4,419,929 130,743 Public works 1,593,399 1,603,956 1,513,186 90,770 Parks and recreation 1,074,672 1,165,706 1,100,107 65,599 Capital outlay 9,000 1,921,531 1,192,721 728,810 Debt service: Principal 440,700 440,700 440,720 (20) Interest 150,700 150,700 150,642 58 Total Expenditures 14,516,130 16,749,336 15,626,455 1,122,881 Excess(Deficiency)of Revenues Over Expenditures 1,220,327 (815,771) 1,537,355 2,353,126 Other Financing Sources(Uses) Transfers out (1,302,581) (1,408,081) (1,573,978) (165,897) Sale of capital assets 21,791 21,791 53,480 31,689 Total Other Financing Uses,Net (1,280,790) (1,386,290) (1,520,498) (134,208) Net Change in Fund Balance (60,463) (2,202,061) 16,857 2,218,918 Fund Balance-Beginning 8,011,879 8,011,879 8,011,879 - Fund Balance-Ending $ 7,951,416 $ 5,809,818 $ 8,028,736 $ 2,218,918 94 See note to budgetary comparison schedule. VILLAGE OF TEQUESTA, FLORIDA NOTE TO THE BUDGETARY COMPARISON SCHEDULE FOR THE FISCAL YEAR ENDED SEPTEMBER 30,2023 Note 1 —Budgets and Budgetary Accounting 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. The legal level of budgetary control is therefore at the fund level. What this means is that any amendment that changes the funds's total budget requires the Village Council to approve it in the same manner that the original budget was approved—by resolution. The original 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 The final 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 $2,338,705 were adopted for the General Fund. Appropriations are legally controlled at the department level and expenditures may not legally exceed budgeted appropriations at that level. 95 O h ' O C-, ' N N -t \o N h M \o C-, ' O M M M o O o M o, v h o M O CO �p al O \O \O 00 h \O al OM al N CO M O h �r"h rn 00 p --i 00 v M h 00 V1 V1 O \O \O V1 --� --� N M CO CO CO h M --i �/l �..i �..i O CO 00 0, M N h o0 --i \O h 69 69 � cz 69 69 69 69 o, O h O ' M ' 00 \o ,--i O ,--i M M ' O N M o, o \o o �n O CO 't 00 cC �n h O al M O h O h N al N N h h o, al o, CO 00 o, l7t h ,--i r' h -t ,--i O ,-; M \o N .r M h O \O al Vl Vl CO r- ONO � CO � N 00 O h o0 69 69 69 69 69 0 o0 p1 O \O \O o O c W O o CO N N r- o, M N OM h O N". � � .� o M 4.1 I� 00 00 ,--i O 00 N Vl N h O l7t 00 0, CO h N Vl ,--i h O M o1 00 U M h OM M N M N Vl �o M �o 00 M O 3 N O O CO CO 7-r A 6A 69 69 69 �/j WL M V V N 00 N V h V M V N 4 CD 4 O h o \o p L� o, 00 M \o 00 O 00 M M 00 M h CO CO zl h \o Vl M 00 00 h 't O O \O \o \o 00 N \O M �--i al h \o al O al M --i CO CO h Vl o, \o N \o 00 v �..� h al h O O h h �p `-'v N N N 00 t 00 W N O 00 O ~O Y � A 69 69 69 F A Sti Sti h M o0 \o -t O �n ' 00 00 h O h \o o N o O L� M Vl 01 M t C, Vl M N O N 00 r-ti 01 00 h ,--i N r- C, 00 C) 01 'tC) ,--i v 00 �n h N 01 O N ~O M CO v \o N CO M 41 v CO O CO O M N O 01 `� M 01 -t M h 01 ' m h o0 Ao ' �n o 01 00 h 01 h 01 00 h ,--i 00 "a ~ ICI FBI M 41 N h CO h 41 41 00 Vl M N r- O h Vl N n M M 41 00 N 00 �p 00 M N \o � 00 �o O h N h N m r- N v r- C, M C, r- r- 00 00 � F-I F-I M 00 o0 or° l N a�oo v v o0 00 C, m oo a;oo v r- oo m o 00 0 00 ' W W W C, �of o�00 �, 't r- r- 00 �o M N a, v — 00 m vM, �ov � oc� � °°� 00 r 00 0 0000 C,, o ,7 W W No 't a M v N v o c� v o o 0 a r— C, oo � N� � � a, i" i o M v i o o r oo M y o 0 L•I Z -- v v N cn �o o a o a v N o v a o a, r-� r-� a z w �o r- �oococ o � r- ocC J 00 �o a, o v, v, N t a, M 't C) v a, m M h 00 a1 m o0 0 0 N N O v�o 00 M �o r" N o o v m o v 00 N ri x N vo v a o o Noo � a m N v o 00 ct 7- cz y A � o o � A C w N U CL A a a r to �'"'' .r-" iy al al 'J •L��n IDGl •i�'i y U � ,� � �,� aoi � � w :e � o 0 0 0 � aoi � -o � � o o P. o w a o � a� U �1 a� U0.1a0 o o � UUUZ0.1a � O o o U Z F 4 VILLAGE OF TEQUESTA REQUIRED SUPPLEMENTARY INFORMATION SCHEDULE OF VILLAGE CONTRIBUTIONS FIREFIGHTERS' PENSION TRUST FUND Fiscal Year Actuarially Contribution Actual Ended Determined Actual Deficiency Covered Contribution as a% September 30, Contribution Contribution (Excess) Payroll of Covered Payroll 2014 $ 416,665 $ 422,107 $ (5,442)$ 1,316,060 32.07% 2015 403,211 406,226 (3,015) 1,294,416 31.38% 2016 454,871 454,871 - 1,379,650 32.97% 2017 498,504 510,016 (11,512) 1,446,616 35.26% 2018 485,729 490,154 (4,425) 1,507,072 32.52% 2019 474,074 488,983 (14,909) 1,572,385 31.10% 2020 614,958 614,958 - 1,699,718 36.18% 2021 603,863 * 603,863 - 1,744,261 34.62% 2022 523,574 * 523,574 - 1,673,296 31.29% 2023 538,716 684,275 (145,559) 1,828,585 37.42% *Excludes prepaid Employer contribution. Notes to Schedule Valuation Date 10/01/2021 Actuarially determined contribution rates are calculated as of October 1,which is two years prior to the end of the fiscal year in which contributions are reported. Methods and Assumptions Used to Determined Contribution rates: Actuarial cost method Entry age normal Amortization method Level dollar, closed Remaining amortization period 20 years Asset valuation method 5-year smoothed market Inflation 2.50% Salary increases 6.0%, including inflation Investment rate of return 7.00% Retirement age 100% upon reaching normal retirement age. Probability of early retirement is 5%or each year eligible. Mortality The same version of PUB-2010 Headcount-Weighted Mortality Tables as used by the Florida Retirement System (FRS) for Special Risk Class members in their July 1, 2020 actuarial valuation (with mortality improvements projected for healthy lives to all future years after 2010 using Scale MP-2018). Florida Statutes Chapter 112.63(1)(f) mandates the use of mortality tables from one of the most recently publiched FRS actuarial valuation reports. Other Information: Notes See discussion of valuation results in the October 1, 2021 Actuarial Valuation report, dated January 31, 2022 97 VILLAGE OF TEQUESTA REQUIRED SUPPLEMENTARY INFORMATION SCHEDULE OF INVESTMENT RETURNS FIREFIGHTERS' PENSION TRUST FUND Fiscal Year Ended September 30, 2023 2022 2021 2020 2019 2018 2017 2016 2015 2014 Annual money-weighted rate of return, net of investment expenses 8.69% (15.03)% 20.27% 8.30% 2.93% 8.92% 10.58% 7.69% 0.38% 7.46% 98 \O \o M;:�, CO al ' 00 al M ,�h O �n o O o Vl N M h ,--i 00 \O 00 h M h 41 Vl Vl 00 �o M N N CO N O M \o O N r-i al O M h al \O vi al \O \o h V1 M N 7 7 00 ONO \O00 M N N N N M 69 69 69 69 69 69 dj M M M N \O 0, M 00 O O \o ,--i ,--i 00 00 O 00 h \o O h Vl h M al r- 0, h O O O O h M \O O al O Ni M 41 v Ni M 00CD cz N N N N (4 M M 69 69 69 69 69 69 V N p 4 00 �o O M 00 C) 00 M \o O p N M Ny M h O N 't \o \D O r` O O O N v vr- 00 41 M O N v v 00 CO Ni rn M \O M O U W Ff3 Ff3 69 69 69 69 M N 01 ' 00 h ' 00 r- 7--� L� 00 M C) \o 00 N N 01 h O 00 C) � M 00 O M V O O 0, O h \O \0 O O \O h h CO CO \O al cQ a 00 O N v v O 0, 0, ti N \O 00 W O N v O V M M M h M v N v N N M M N o N oo N N v �o 00 O o0 00 00 v, M a1 0 �o o N p \No ON1 N O O O M\No � M 0�1 'C ' 00 Oo m 0, 0 0 r W Z a1 a1 m v al al oo oo m cd O N Cn oo m v n N M vi M v3 v3 v3 v3 v3 v3 bA p N M � � N4 Mh O M Vl N CO N Cl 00 al M N O O, iy �Sti r- CC W O Vl ,--i vj O O C, N 0, N C1 Vl M O O l e (+1 Ao C, �i l O Cr1 U N � 00 00 � � � r z W Z bs v3 es v3 es bs cn O Nr` OOv W \o 0, h 00 / O O N M C r` r` 00 a O O r M 4 D\ _Vl N o00 o 0o vcn000000 M a vv a r r v r o Moi 0;riv r a v v a 00 +� ao, ra,i CD N o Ur a N N N N O w �o 00 o o v �o N o0 a, �o �o m oo v v o �o o C) M "I a, M M o M 00 a, cn a, p o cl O v C, o0 00 �o O �00 O r- v o � r- M oo .. W 0; � o m C, x W oo o O N o �o N o O M 41 N N VO M H � � 69 69 69 69 69 69 i-I yy..� o0 M 0, M 0, M M r C) al M U CIl / V N O CO 4 O OO h \ ho N CO 4 O CO N M p 00 00 Ln r, ICI N 00 00 \p '/� CDO 0, 7r 0, � �n \o \O h M 00 O U IFN��JI N �O 00 \O O N M O 00 \O v v h N h M p — cC U � y O4r W � � Ln x o en w � a o z co w u � oME a� cz i ° a cz o 0 o a o 0 0 0 0 O � u Z Zto eC w, s7 .� .+ .+ �.i F � aa'" 0.1 Ca � U 0.1 P! � Z F F P.i U U U VILLAGE OF TEQUESTA REQUIRED SUPPLEMENTARY INFORMATION SCHEDULE OF VILLAGE CONTRIBUTIONS POLICE OFFICERS' PENSION TRUST FUND Fiscal Year Actuarially Contribution Actual Ended Determined Actual Deficiency Covered Contribution as a% September 30, Contribution Contribution (Excess) Payroll of Covered Payroll 2014 $ 111,164 $ 111,164 $ - $ 517,760 21.47% 2015 80,782 80,782 - 410,897 19.66% 2016 37,377 38,638 (1,261) 341,342 11.32% 2017 40,659 40,829 (170) 339,957 12.01% 2018 175,116 175,116 - 582,166 30.08% 2019 317,338 317,338 - 1,153,957 27.50% 2020 293,462 293,462 - 1,229,934 23.86% 2021 293,705 293,705 - 1,304,196 22.52% 2022 320,362 320,362 - 1,470,899 21.78% 2023 348,850 348,850 - 1,593,652 21.89% Notes to Schedule Valuation Date 10/01/2021 Actuarially determined contribution rates are calculated as of October 1,which is two years prior to the end of the fiscal year in which contributions are reported. Methods and Assumptions Used to Determined Contribution Rates: Actuarial cost method Entry age normal Amortization method Level dollar, closed Remaining amortization period 20 years Asset valuation method 5-year smoothed market Inflation 2.50% Salary increases 6.0%, including inflation Investment rate of return 7.00% Retirement age 100% upon reaching normal retirement age. Probability of early retirement is 5%or each year eligible. Mortality The same version of PUB-2010 Headcount-Weighted Mortality Tables as used by the Florida Retirement System (FRS) for Special Risk Class members in their July 1, 2020 actuarial valuation (with mortality improvements projected for healthy lives to all future years after 2010 using Scale MP-2018). Florida Statutes Chapter 112.63(1)(f) mandates the use of mortality tables from one of the most recently publiched FRS actuarial valuation reports. Other information: Notes See discussion of valuation results in the October 1, 2021 Actuarial Valuation report, dated January 31, 2022. 100 VILLAGE OF TEQUESTA REQUIRED SUPPLEMENTARY INFORMATION SCHEDULE OF INVESTMENT RETURNS POLICE OFFICERS' PENSION TRUST FUND Fiscal Year Ended September 30, 2023 2022 2021 2020 2019 2018 2017 2016 2015 2014 Annual money-weighted rate of return, net of investment expenses 8.69% (15.03)% 20.27% 8.30% 2.93% 8.92% 10.58% 7.69% 0.38% 7.46% 101 41 � ^ M 00 h O -t � � CO N h G 0 0 \o Ni 00 N \o h M O M r- C, 00 h 00 al CO O O N v�i al O N N N M N M N 69 69 69 cz C) 00 00 \o 00 �o 00 C,00 M h C) N o O o .fir N O 00 01 h 00 C, M 01 C, M M h Vl al al N O0 M N 01 C, O Vl C, Vl h h O F"r O M in 00 C, 41 \p CO N O O OM N M O ~ M N M OM N M M M M N rG+ A r 69 ' ' 6A 6A 6A 6A 6A M o0 v C, 00 't.- N 41 O \O N C, r- ONO 0�0 \O C) 01 C, h h 00 U w C, O \o O N C1 N O O 7t a O F3 �n 00 h \o 't O M al \O N al al O O A 3�r Z 6A 69 69 69 69 69 � M 00 p� t 00 V1 o O o 00 _ M \o N �n C, '/� 01 'th \p N N N r- 00 Vl C, 41 M O0 00 N \- 41 h N ' �I O C1 N -1 N h vi M N h C1 kr vi h p O 1� O 01 ~ � Fi�--I Y3 69 69 69 69 69 O C, i N M h N t 00 N O '/� 00 M o O o M M O N N M N M M C) O h CO C)cn 00 �n M 00 �n ,� �o v v N m 00 CD r- \O N 00 N �n r- M O � N 00 C) 4� ICI ~ M W^L' � FA FA FA FA FA � 00 CO M 41 00 h M O h o O o N 00 N 00 CO CO N n � M \O 01 00 a a 0 N 00 00 N 00 00 C, v� � N N �� M 71,v o CD N M a1 rn T W NN v C, GO C, r- �o v � �oN o 0 0 o O o N o N �o N M �o 00 n v M n N M o N o O W h M 00 h M 00 Q, 00 M. M M vO l l 41 N w w O 1-0O l O C1 O O M 0 l M ✓ N O Vl '^ O N N M VO �'^ p� N '^ N M Y 75 'n 00 ' O O 00 \O M N O O h O \O o O o M N p, r- N N �/l 00 C) C, r- N N 00 '/� Vl 00 't W Vl Vl \o 't 00 't 00 N O h h 't CO --i�n \O CO h 01 N 01 00 00 N 00 O 00 h M 00 00 O 01 01 00 p� �p rn U J ICI 0 v O M N \O M --i h 0000 N � v .fir rIr�� N h h h CO M "'a I� I•�I v yN.� a, i( v v o0 v i o v o o v v o O o Vl h W N O, 00 M r- 00 N O, O 00 �/l 00 00 C) 00 N l "D 00 N O, O N M N t 00 N O, O M X t 00 I`'I1 N N 01 N �O h 01 O O O \O v M \O 00 N h 01 O O ON h 00 �~..^i�"� �..i �--i 00 h M 69 69 69 �..i 6A 69 69 � 75 14.11 to x w w �y ^C cC U W y 'm 8, W W CL o U U Z =u w4 a a o o a o VILLAGE OF TEQUESTA REQUIRED SUPPLEMENTARY INFORMATION SCHEDULE OF VILLAGE CONTRIBUTIONS GENERAL EMPLOYEES' PENSION TRUST FUND Fiscal Year Actuarially Contribution Actual Ended Determined Actual Deficiency Covered Contribution as a% September 30, Contribution Contribution (Excess) Payroll of Covered Payroll 2014 $ 184,627 $ 184,627 $ - $ 2,011,191 9.18% 2015 194,376 194,376 - 2,305,760 8.43% 2016 201,704 201,704 - 2,696,572 7.48% 2017 235,972 305,931 (69,959) 2,867,220 10.67% 2018 350,412 350,412 - 3,128,680 11.20% 2019 362,848 362,848 - 3,231,060 11.23% 2020 391,341 391,341 - 3,603,500 10.86% 2021 380,003 380,003 - 3,435,840 11.06% 2022 350,247 350,247 - 3,629,500 9.65% 2023 331,983 331,983 - 3,933,440 8.44% Notes to Schedule Valuation Date 10/01/2021 Actuarially determined contribution rates are calculated as of October 1,which is two years prior to the end of the fiscal year in which contributions are reported. Methods and Assumptions Used to Determined Contribution Rates: Actuarial cost method Aggregate method Amortization method N/A Remaining amortization period N/A Asset valuation method 5-year smoothed market Inflation 2.25% Salary increases 4.75%to 5.50%, including inflation,based on years of service. Investment rate of return 6.50% Retirement age 100% if eligible for normal retirement before age 62, else age based from 30% at age 62 to 100% at age 70; 5% for each year eligible for early retirement. Mortality The same version of PUB-2010 Headcount-Weighted Mortality Table as used by the Florida Retirement System (FRS) in their July 1, 2021 actuarial valuation (with mortality improvements projected to all future years after 2010 using Scale MP-2018). Florida Statutes Chapter 112.63(1)(f)mandates the use of mortality tables from one of the two most recently published FRS actuarial valuation reports. Other information: Notes See discussion of valuation results from the October 1, 2021 Actuarial Valuation report. 103 VILLAGE OF TEQUESTA REQUIRED SUPPLEMENTARY INFORMATION SCHEDULE OF INVESTMENT RETURNS GENERAL EMPLOYEES' PENSION TRUST FUND Fiscal Year Ended September 30, 2023 2022 2021 2020 2019 2018 2017 2016 2015 2014 Annual money-weighted rate of return, net of investment expenses 8.58% (15.89)% 19.38% 8.83% 3.36% 7.28% 12.52% 3.97% (2.11)% 9.73% 104 VILLAGE OF TEQUESTA REQUIRED SUPPLEMENTARY INFORMATION SCHEDULE OF CHANGES IN TOTAL OPEB LIABILITY AND RELATED RATIOUS OTHER POST-EMPLOYMENT BENEFITS Measurement Date,September 30, 2022 2021 2020 2019 2018 2017 Total OPEB Lability Service cost $ 79,520 $ 63,270 $ 57,961 $ 50,439 $ 51,371 $ 53,040 Interest 21,209 12,060 12,064 25,960 22,929 19,739 Difference between expected and actual experience - - - (309,165) - - Changes of assumptions and other inputs (144,458) 411,041 6,038 12,964 (13,500) (14,020) Benefit payments (48,910) (20,244) (19,040) (34,636) (39,712) (37,725) Net Change in Total OPEB Liability (92,639) 466,127 57,023 (254,438) 21,088 21,034 Total OPEB Liability-Beginning 913,400 447,273 390,250 644,688 623,600 602,566 Total OPEB Liability-Ending $ 820,761 $ 913,400 $ 447,273 $ 390,250 $ 644,688 $ 623,600 Covered-Employee Payroll $ 6,773,694 $ 7,825,935 $ 7,597,995 $ 7,284,363 $ 6,694,984 $ 5,708,842 Total OPEB Liability as a percentage of Covered-Employee Payroll 12.12% 11.67% 5.89% 5.36% 9.63% 10.92% Notes to Schedule Changes of benefit terms. There were no benefit changes during the year. Changes of assmptions. Changes of assumptions and other inputs reflect the effect of changes in the discount rate each period. Discount rate changed to 4.40%from 2.19%. Inflation is 2.25%. There are no plan assets accumulated in the trust fund that meets the criteria of GASB Statement No. 75 to pay related benefits. The following is a select health cost trends: FY Beginning 2023 5.75% 2024 5.60% 2025 5.42% 2026 5.24% 2027 5.07% 2028 4.89% 2029 4.71% 2030 4.53% 2031 4.14% Ultimate health cost trend 3.75% Salary increases General Employees plan participants 4.75%-5.50%, including inflation; Public Safety-6%per year, including inflation. The Village of Tequesta implemented GASB Statement No.75 in fiscal year ending 9/30/2018 with a measurement date of 9/30/2017.This schedule is presented as required,however,until a full 10-year trend is compiled,the Village is only presenting information for those years for which information is available. 105 VILLAGE OF TEQUESTA REQUIRED SUPPLEMENTARY INFORMATION FLORIDA RETIREMENT SYSTEM (FRS) SCHEDULE OF PROPORTIONATE SHARE OF THE NET PENSION LIABILITY Fiscal Year Ended June 30, 2023 2022 2021 2020 2019 2018 2017 2016 2015 2014 Proportion of the net pension liability 0.00025% 0.00041% 0.00135% 0.00165% 0.00158% 0.00166% 0.00189% 0.00227% 0.00223% 0.00291% Proportionate share of the net pension liability $99,080 $152,863 $101,680 $717,034 $543,212 $501,303 $561,097 $572,594 $ 287,876 $ 177,517 Covered payroll $70,598 $105,084 $297,735 $222,110 $285,622 $369,696 $391,643 $492,907 $ 508,785 $ 635,666 Proportionate share of the net pension liability as a percentage of its covered payroll 140.34% 145.47% 34.15% 322.83% 190.19% 135.60% 143.27% 116.17% 56.58% 27.93% Plan fiduciary net position as a percentage of the total pension liability 82.38% 82.89% 96.40% 78.85% 82.61% 84.26% 83.89% 84.88% 92.00% 96.09% The amounts presented for each fiscal year were determined as of 6/30. 106 VILLAGE OF TEQUESTA REQUIRED SUPPLEMENTARY INFORMATION HEALTH INSURANCE SUBSIDY PROGRAM (HIS) SCHEDULE OF PROPORTIONATE SHARE OF THE NET PENSION LIABILITY Fiscal Year Ended June 30, 2023 2022 2021 2020 2019 2018 2017 2016 2015 2014 Proportion of the net pension liability 0.00018% 0.00029% 0.00087% 0.00090% 0.00094% 0.00113% 0.00121% 0.00160% 0.00168% 0.00214% Proportionate share of the net pension liability $28,300 $30,542 $107,220 $109,870 $104,854 $119,802 $129,440 $186,087 $ 171,031 $ 200,044 Covered payroll $70,598 $105,084 $297,735 $222,110 $285,622 $369,696 $391,643 $492,907 $ 508,785 $ 635,666 Proportionate share of the net pension liability as a percentage of its covered payroll 40.09% 29.06% 36.01% 49.47% 36.71% 32.41% 33.05% 37.75% 33.62% 31.47% Plan fiduciary net position as a percentage of the total pension liability 4.12% 4.81% 3.56% 3.00% 2.63% 2.15% 1.64% 0.97% 0.50% 0.99% The amounts presented for each fiscal year were determined as of 6/30. 107 VILLAGE OF TEQUESTA REQUIRED SUPPLEMENTARY INFORMATION FLORIDA RETIREMENT SYSTEM (FRS) SCHEDULE OF VILLAGE CONTRIBUTIONS Fiscal Year Ended September 30, 2023 2022 2021 2020 2019 2018 2017 2016 2015 2014 Contractually required contribution $ 8,422 $ 13,668 $ 44,150 $ 58,313 $ 52,059 $ 48,540 $ 47,988 $ 62,966 $ 43,642 $ 58,404 Contributions in relation to the conractually required contribution (8,422) (13,668) (44,150) (58,313) (52,059) (48,540) (47,988) (62,966) (43,642) (58,404) Contribution deficiency(excess) $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - Covered payroll $ 49,714 $ 81,619 $277,220 $233,482 $261,899 $362,908 $382,869 $451,085 $484,772 $569,299 Contributions as a percentage of covered payroll 16.94% 16.75% 15.93% 24.98% 19.88% 13.38% 12.53% 13.96% 9.00% 10.26% The information in this schedule determined as of the Village's most recent fiscal year. 108 VILLAGE OF TEQUESTA REQUIRED SUPPLEMENTARY INFORMATION HEALTH INSURANCE SUBSIDY PROGRAM (HIS) SCHEDULE OF VILLAGE CONTRIBUTIONS Fiscal Year Ended September 30, 2023 2022 2021 2020 2019 2018 2017 2016 2015 2014 Contractually required contribution $ 825 $ 1,355 $ 4,602 $ 3,876 $ 4,348 $ 6,024 $ 6,356 $ 7,488 $ 5,381 $ 6,832 Contributions in relation to the conractually required contribution (825) (1,355) (4,602) (3,876) (4,348) (6,024) (6,356) (7,488) (5,381) (6,832) Contribution deficiency(excess) $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - Covered payroll $ 49,714 $ 81,619 $277,220 $233,482 $261,899 $362,908 $382,869 $451,085 $484,772 $569,299 Contributions as a percentage of covered payroll 1.66% 1.66% 1.66% 1.66% 1.66% 1.66% 1.66% 1.66% 1.11% 1.20% The information in this schedule determined as of the Village's most recent fiscal year. 109 !_ F ■ COMBINING AND INDIVIDUAL FUND STATEMENTS AND SCHEDULES 9 NONMAJOR GOVERNMENTAL FUNDS NONMAJOR GOVERNMENTAL FUNDS Special Revenue Funds Special revenue funds are used to account for specific revenue sources that are restricted to expenditures for particular purposes. Building Fund - This fund accounts for permit fees required on all public or private buildings, structures, and facilities. The revenue obtained shall be used solely for carrying out responsibilities in enforcing Florida Building Code. 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 Funds are 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 Project 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 30,2023 Special Revenue Capital Projects Total Special Law Capital Capital Nonmajor Building Enforcement Improvement Projects Governmental Fund Fund Fund Fund Funds Assets Cash $ 1,089,155 $ 315,882 $ 1,408,360 $ 262,355 $ 3,075,752 Receivables,net 41 143 - - 184 Inventories 110 - - - 110 Prepaid items 10,547 3,585 - - 14,132 Total Assets $ 1,099,853 $ 319,610 $ 1,408,360 $ 262,355 $ 3,090,178 Liabilities and Fund Balances Liabilities Accounts payable 14,895 4,213 111,687 - 130,795 Accrued liabilities 9,391 - - - 9,391 Due to other governments 11,923 - - - 11,923 Total Liabilities 36,209 4,213 111,687 - 152,109 Fund Balances Nonspendable: Inventories 110 - - - 110 Prepaid Items 10,547 3,585 - - 14,132 Restricted for: Infrastructure - - 361,199 - 361,199 Building 1,052,159 - - - 1,052,159 Law Enforcement - 298,778 - - 298,778 Capital Projects - - 271,687 - 271,687 Assigned to: Capital Projects - - 46,690 262,355 309,045 Subsequent years budget 828 13,034 617,097 - 630,959 Total Fund Balances 1,063,644 315,397 1,296,673 262,355 2,938,069 Total Liabilities and Fund Balances $ 1,099,853 $ 319,610 $ 1,408,360 $ 262,355 $ 3,090,178 110 VILLAGE OF TEQUESTA,FLORIDA COMBINING STATEMENT OF REVENUES,EXPENDITURES AND CHANGES IN FUND BALANCES NONMAJOR GOVERNMENTAL FUNDS FOR THE FISCAL YEAR ENDED SEPTEMBER 30,2023 Special Revenue Capital Projects Total Special Law Capital Capital Nonmajor Building Enforcement Improvement Projects Governmental Fund Fund Fund Fund Funds Revenues Charges for services $ 3,074 $ - $ - $ - $ 3,074 Licenses and permits 1,053,625 - - - 1,053,625 Fines and forfeitures - 268,447 - - 268,447 Investment earnings 30,870 5,579 28,750 1,082 66,281 Total Revenues 1,087,569 274,026 28,750 1,082 1,391,427 Expenditures Public safety 842,019 42,614 - - 884,633 Transportation - - 121,784 - 121,784 Capital outlay 54,436 49,537 285,457 170,000 559,430 Total Expenditures 896,455 92,151 407,241 170,000 1,565,847 Excess(Deficiency)of Revenues Over(Under)Expenditures 191,114 181,875 (378,491) (168,918) (174,420) Other Financing Sources(Uses) Transfers in - - 873,583 294,895 1,168,478 Transfers out - - (111,030) - (111,030) Total Other Financing Sources,Net - - 762,553 294,895 1,057,448 Net Change in Fund Balances 191,114 181,875 384,062 125,977 883,028 Fund Balances-Beginning of Year 872,530 133,522 912,611 136,378 2,055,041 Fund Balances-End of Year $ 1,063,644 $ 315,397 $ 1,296,673 $ 262,355 $ 2,938,069 111 VILLAGE OF TEQUESTA,FLORIDA BUDGETARY COMPARISON SCHEDULE BUILDING FUND FOR THE FISCAL YEAR ENDED SEPTEMBER 30,2023 Variance with Final Budget Budgeted Amounts Actual Positive Original Final Amounts (Negative) Revenues Charges for services $ - $ - $ 3,074 $ 3,074 Licenses and permits 604,115 650,865 1,053,625 402,760 Investment earnings 3,000 3,000 30,870 27,870 Total Revenues 607,115 653,865 1,087,569 433,704 Expenditures Public safety 812,560 859,310 842,019 17,291 Capital outlay 33,000 62,399 54,436 7,963 Total Expenditures 845,560 921,709 896,455 25,254 Net Change in Fund Balance (238,445) (267,844) 191,114 458,958 Fund Balance-Beginning 872,530 872,530 872,530 - Fund Balance-Ending $ 634,085 $ 604,686 $ 1,063,644 $ 458,958 112 VILLAGE OF TEQUESTA,FLORIDA BUDGETARY COMPARISON SCHEDULE SPECIAL LAW ENFORCEMENT TRUST FUND FOR THE FISCAL YEAR ENDED SEPTEMBER 30,2023 Variance with Final Budget Budgeted Amounts Actual Positive Original Final Amounts (Negative) Revenues Fines and forfeitures $ 63,700 $ 63,700 $ 268,447 $ 204,747 Investment earnings - - 5,579 5,579 Total Revenues 63,700 63,700 274,026 210,326 Expenditures Public safety 64,707 66,569 42,614 23,955 Capital outlay 35,000 77,324 49,537 27,787 Total Expenditures 99,707 143,893 92,151 51,742 Net Change in Fund Balance (36,007) (80,193) 181,875 262,068 Fund Balance-Beginning 133,522 133,522 133,522 - Fund Balance-Ending $ 97,515 $ 53,329 $ 315,397 $ 262,068 113 VILLAGE OF TEQUESTA,FLORIDA BUDGETARY COMPARISON SCHEDULE CAPITAL IMPROVEMENT FUND FOR THE FISCAL YEAR ENDED SEPTEMBER 30,2023 Variance with Final Budget Budgeted Amounts Actual Positive Original Final Amounts (Negative) Revenues lnvestment earnings $ - $ $ 28,750 $ 28,750 Total Revenues - 28,750 28,750 Expenditures Transportation 773,285 773,285 121,784 651,501 Capital outlay 444,837 444,837 285,457 159,380 Total Expenditures 1,218,122 1,218,122 407,241 810,881 (Deficiency)of Revenues Under Expenditures (1,218,122) (1,218,122) (378,491) 839,631 Other Financing Sources Transfers in 707,686 707,686 873,583 165,897 Transfers out - (111,030) (111,030) - Total Other Financing Sources 707,686 596,656 762,553 165,897 Net Change in Fund Balance (510,436) (621,466) 384,062 1,005,528 Fund Balance-Beginning 912,611 912,611 912,611 - Fund Balance-Ending $ 402,175 $ 291,145 $ 1,296,673 $ 1,005,528 114 VILLAGE OF TEQUESTA,FLORIDA BUDGETARY COMPARISON SCHEDULE CAPITAL PROJECTS FUND FOR THE FISCAL YEAR ENDED SEPTEMBER 30,2023 Variance with Final Budget Budgeted Amounts Actual Positive Original Final Amounts (Negative) Revenues Investment earnings $ - $ $ 1,082 $ 1,082 Total Revenues - 1,082 1,082 Expenditures Capital outlay 170,000 178,000 170,000 8,000 Total Expenditures 170,000 178,000 170,000 8,000 (Deficiency)of Revenues Under Expenditures (170,000) (178,000) (168,918) 9,082 Other Financing Sources Transfers in 294,895 294,895 294,895 - Total Other Financing Sources 294,895 294,895 294,895 - Net Change in Fund Balance 124,895 116,895 125,977 9,082 Fund Balance-Beginning 136,378 136,378 136,378 - Fund Balance-Ending $ 261,273 $ 253,273 $ 262,355 $ 9,082 115 ram• 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 post-employment 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. 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 30,2023 Police General Firefighters' Officers' Employees' Pension Pension Pension Trust Fund Trust Fund Trust Fund Total Assets Cash and cash equivalents $ 56,078 $ 27,871 $ 303,660 $ 387,609 Investments Equities 9,851,037 4,892,814 5,560,117 20,303,968 Fixed Income 3,360,108 1,668,899 1,923,746 6,952,753 Real Estate Fund 1,521,137 755,519 864,306 3,140,962 Total investments 14,732,282 7,317,232 8,348,169 30,397,683 Contributions receivable 34,412 5,058 10,300 49,770 Accrued interest receivable 15,802 7,854 13,239 36,895 Total Assets 14,838,574 7,358,015 8,675,368 30,871,957 Liabilities Accounts payable 11,671 8,658 14,162 34,491 Total Liabilities 11,671 8,658 14,162 34,491 Net Position Restricted for Pension Benefits $ 14,826,903 $ 7,349,357 $ 8,661,206 $ 30,837,466 116 VILLAGE OF TEQUESTA, FLORIDA COMBINING STATEMENT OF CHANGES IN FIDUCIARY NET POSITION FOR THE FISCAL YEAR ENDED SEPTEMBER 30,2023 Police General Firefighters' Officers' Employees' Pension Pension Pension Trust Fund Trust Fund Trust Fund Total Additions Contributions: State of Florida $ 244,737 $ 108,867 $ - $ 353,604 Employer 439,538 126,138 331,983 897,659 Employee 109,715 92,612 196,672 398,999 Total Contributions 793,990 327,617 528,655 1,650,262 Investment Earnings Net appreciation in fair value of investments 889,971 422,140 565,890 1,878,001 Gain on sale of investments 93,505 45,103 16,531 155,139 Interest and dividends 296,502 144,855 184,641 625,998 Total investment earnings 1,279,978 612,098 767,062 2,659,138 Less investment expenses (40,424) (27,534) (47,561) (115,519) Net Investment earnings 1,239,554 584,564 719,501 2,543,619 Total Additions 2,033,544 912,181 1,248,156 4,193,881 Deductions Benefits paid 355,759 129,304 236,372 721,435 Refund of contributions 563,343 43,675 36,696 643,714 Administrative expenses 33,187 33,187 56,336 122,710 Total Deductions 952,289 206,166 329,404 1,487,859 Change in Net Position 1,081,255 706,015 918,752 2,706,022 Net Position Restricted for Pension Benefits Beginning of year 13,745,648 6,643,342 7,742,454 28,131,444 End of year $ 14,826,903 $ 7,349,357 $ 8,661,206 $ 30,837,466 117 s t STATISTICAL SECTION STATISTICAL SECTION This part of the Village of Tequesta's Annual Comprehensive 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. Contents Page Financial Trends These schedules contain trend information to help the reader understand how the Village's financial performance and well-being have changed over time. 118 Revenue Capacity These schedules contain information to help the reader assess the Village's most significant local revenue source, the property tax. 123 Debt Capacity These schedules present information to help the reader assess the affordability of the Village's current levels of outstanding debt and the Town's ability to issue additional debt in the future. 127 Demographic and Economic Information These schedules offer demographic and economic indicators to help the reader understand the environment within which the Village's financial activities take place. 131 Operating Information These schedules contain service and infrastructure data to help the reader understand how the information in the Village's financial report relates to the services the Village provides and the activities it performs. 133 Sources: Unless otherwise noted, the information in these schedules is derived from the Comprehensive Annual Financial Reports for the relevant year. 00 00 � �o C C, O \o 00 M O 01 M Moo N O N h O \O 0o 00 00 M 00 N \O 01 \o h M h 00 69 69 69 69 69 69 M N M M \O \O 00 Vl Vl h 00 h 41 \O h M N '/l C1 \O N r-i N \O h M M N M \o M M 01 00 p M h 00 C1 \O M M 01 N M N O 00 O 69 69 69 69 69 69 Vl O C, \O 00 O ,--i 00 C, CO 00 h CO \O \O h C1 M 00 00 O O \O 't N '/l M M N O N N \O h h 't p \O O h M 69 69 69 69 69 69 00 M --i N h V1 01 \O 00 --i N 01 N M M C1 00 'n 01 O p M 00 h \o 01 \o 00 N h C, CO 'n \O 01 C, \O M 01 h _ 00 'n 69 69 69 69 69 69 N '/l 01 \o \o 't 00 Ul 00 Vl M M h \o 0000 N \O h 00 \o A UM N O N M_ M h O M N 0 rn M �.fy �.y � 69 69 69 69 69 69 01 h h h ' --i 00 01 00 ^I 0 O 00 N CO O CO \O N O 00 � 00rn rn d w C, 't a WM VO l l 00 M --i r-i AO O 01 000 CD Oa a es v es v es v 01 M O Fti yh 7r h `d M Vl O C, N \O 00 Vl N \O a 00 M Ni rr - CO 01 M C; 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OL A h a h 0 cz N rC �--, ,� N pp cn � cn � 'R cn > 59 59 p. cz O ' C CZ y�y� � u \ \ °gyp cd 'C cz Oc Oc O i N .y 70— V) V) CZ CZ O U bA cyd W M44 cz 0 z Oo cc o co " O C cz U u CZ O p o /a cs-� a� bA W 69 ca � O p •� �.^�" � � cz cz E., on cz 4.1 O — n O ' _ro bA P••� ay O 'C N N 11 O O cz Z CZ O nn N bA C V O O O O y � U s0. O 0 U t � ct O U U Ctcz U U Q � � � �N SC �' N N E-� O U O Cad cz cz Oaa Q � o 0 0 0 0 0 0 0 0 0 O ^ w on 7t 7t 7t 7t 7t 7t 7t non Q, O U U cl V') 7t M \O 7t O 00 00 N W 7t `p O cd V] w U ¢ 0 E :\ :\ d N s. �. O' w cl ,� O U H �nor- 11oocoN11C7t .14 7 O N7t11o11o7tr- O w `" M M 7t 7t 7t7t V') AO AO U � O � ' � � Cf? 0 P� En cl 7t N N all AO AO AO 00 00 00 O cH cd p �. OVl Vl Vl Vl Vl Vl Vl \O \O \O rn O + U c CA .O Cj Cj cl cl 0 -0 Q � U Q m �" � v `O r— oc O\ O -- N M r O un un u U cl — — — — — — N N N N U O CA 7t O ^ ^ ^ ^ VILLAGE OF TEQUESTA, FLORIDA PRINCIPAL EMPLOYERS-PALM BEACH COUNTY CURRENT YEAR AND NINE YEARS AGO 2023 2014 Percentage of Percentage of Total County Total County Employer(service providing) Employees Rank Employment Employees Rank Employment Palm Beach County School District 22,426 1 3.0% 21,548 1 3.5% Palm Beach County 12,266 2 1.6% 10,807 2 1.8% Tenet HealthCare Corp 5,734 3 0.8% 6,100 3 1.0% NextEra Energy,Inc.(Hdgtrs)/Florida Power&Light 5,330 4 0.7% 3,804 4 0.6% Florida Atlantic University 5,059 5 0.7% 2,980 6 0.5% Boca Raton Regional Hospital 3,135 6 0.4% 2,250 10 0.4% Veterans Health Administration 2,600 7 0.3% 2,700 8 0.4% Hospital Corporation of America(FICA) 2,419 8 0.3% 2,714 7 0.4% The Breakers 2,300 9 0.3% Baptist Health South Florida(prev.Bethesda Hospital) 2,282 10 0.3% 2,643 9 0.4% G4S(Wackenhut Corporation) 3,000 5 0.5% 63,551 8.4% 58,546 9.5% Source: Business Development Board of Palm Beach County,Florida(last updated January 2022) Employment information for the'lawn is not available 132 O N N O N O N O N M �c M O N � 00 O M cz O �I N N O z r�r1 O o0 0, '7T � O •a ICI O lM 00 M l� N ~ N O, V1 w d > 00 W U M O O O N O N 00 O O w c H b , , 00 000 -a oc I/ N w N a U cz U y u u cz � 'E } N � 7-r N CC •.� � O CC CC 7-i N Z w VILLAGE OF TEQUESTA,FLORIDA OPERATING INDICATORS BY FUNCTION/PROGRAM LAST TEN FISCAL YEARS 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 Governmental Activities General government Registered voters 4,702 4,634 4,813 4,017 4,951 5,056 5,204 4,971 4,960 4,454 Public safety: No. of full-time certified police officers 20 19 18 19 19 19 19 20 21 20 No.of calls received 3,548 3,853 3,109 3,442 3,443 3,614 3,571 2,375 2,735 2,766 No.of arrests 168 174 94 108 69 61 46 40 43 32 No.ofparking violations 120 207 61 39 20 48 48 34 - - No.of incident numbers issued 725 552 345 312 254 259 181 280 434 371 Fire department: No.of full-time certified firefighters 18 22 22 22 22 21 21 21 22 22 No.of emergency responses 1,197 1,291 1,409 1,286 1,227 1,168 1,226 1,186 1,174 1,374 No.of transports 693 1,006 817 722 724 721 1,017 684 941 816 No.of fires extinguished/alarms 504 285 254 309 267 206 323 263 164 198 No.of inspections 713 499 654 742 608 767 405 558 648 720 Building,zoning: No.of building permits issued 929 1,034 1,583 1,755 1,356 1,226 1,198 1,412 1,522 1,592 No.of building inspections conducted 2,201 1,705 2,472 3,017 2,634 2,649 2,611 2,429 3,857 3,817 Leisure services: No. of Spring Classes 8 8 12 10 10 10 7 4 14 14 No.of Summer Classes 4 4 4 4 4 4 - 1 18 18 No.of Movies 4 3 3 3 3 2 - - 1 - Business-type Activities Water: No.of customers 5,039 5,038 5,055 5,042 5,087 5,084 5,070 5,070 5,087 5,101 Average daily consumption 2.422 mg 2.500 mg 2.600 mg 2.700 mg 2.781 mg 2.642 mg 2.656 mg 2.573 mg 2.626 mg 2.683 mg Sources: Various Village departments 134 VILLAGE OF TEQUESTA,FLORIDA CAPITAL ASSET STATISTICS BY FUNCTION/PROGRAM LAST TEN FISCAL YEARS Function/Program 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 Governmental Activities General government: Municipal center 1 1 1 1 1 1 1 1 1 1 Public safety Police: No.of stations 1 1 1 1 1 1 1 1 1 1 No.of patrol units 11 10 12 10 12 11 11 12 13 13 Fire: No.of stations 1 1 1 1 1 1 2 1 1 1 No.of ambulances 3 2 2 2 2 2 2 2 2 2 No.of pumpers 3 3 3 2 2 2 2 2 2 2 Transportation: Miles of street lane miles 24 24 24 24 24 24 24 24 24 24 No.of bridges 1 1 1 1 1 1 1 1 1 1 Leisure services No.of parks 6 * 6 6 7 7 7 7 7 6 6 No.of park acreage 62 * 62 62 62 62 62 62 62 60 60 No.of playgrounds 2 2 2 2 2 2 2 2 2 2 No.of baseball/softball diamonds 3 3 3 3 3 3 3 3 3 3 No.of skate-parks 1 1 1 1 1 1 1 1 1 1 Business-type activities: Water: Miles of water mains 73 73 77 77 77 77 72 74 74 74 No.of fire hydrants 409 430 456 435 435 435 579 580 580 580 Storage capacity(thousands of gallons) 2,750 2,750 2,750 2,750 2,750 2,750 2,750 2,750 2,750 2,750 Sources: Various Village departments *The green area has been identified as a park(Linear/Green Mile park) 135 y y i f t REPORTING SECTION -N AT 4e� MAULDIN&JENKINS CPAs & ADVISORS INDEPENDENT AUDITOR'S REPORT ON INTERNAL CONTROL OVER FINANCIAL REPORTING AND ON COMPLIANCE AND OTHER MATTERS BASED ON AN AUDIT OF FINANCIAL STATEMENTS PERFORMED IN ACCORDANCE WITH GOVERNMENT AUDITING STANDARDS 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 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 year ended September 30, 2023, and the related notes to the financial statements, which collectively comprise the Village's basic financial statements and have issued our report thereon dated March 11, 2024. Report on 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) as a basis for designing audit procedures that are appropriate in the circumstances for the purpose of expressing our opinion 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. A deficiency in internal control exists when the design or operation of a control does not allow management or employees, in the normal course of performing their assigned functions, to prevent, or detect and correct, misstatements on a timely basis. A material weakness is a deficiency, or a combination of deficiencies, in internal control such that there is a reasonable possibility that a material misstatement of the entity's financial statements will not be prevented or detected and corrected on a timely basis. 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 or significant deficiencies may exist that were not identified. 1401 MANATEE AVENUE WEST,SUITE 1200•BRADENTON,FLORIDA 34205.941-747-4483•FAX 941-747-6035•www.mjcpa.com MEMBERS OF THE AMERICAN INSTITUTE OF CERTIFIED PUBLIC ACCOUNTANTS Report on Compliance and Other Matters As part of obtaining reasonable assurance about whether the Village's financial statements are free of material misstatement, we performed tests of its compliance with certain provisions of laws, regulations, contracts, and grant agreements, noncompliance with which could have a direct and material effect on the financial statements. 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 entity'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. Bradenton, Florida March 11, 2024 137 VILLAGE OF TEQEUSTA, FLORIDA SCHEDULE OF FINDINGS AND RESPONSES FOR THE FISCAL YEAR ENDED SEPTEMBER 30, 2023 SECTION I SUMMARY OF AUDIT RESULTS Financial Statements Type of report the auditor issued on whether the financial statements were prepared in accordance with GAAP: Unmodified Internal control over financial reporting: Material weaknesses identified? yes X no Significant deficiencies identified not considered to be material weaknesses? yes X none reported Noncompliance material to financial statements noted? yes X no Federal Programs and State Financial Assistance Proiects There was not an audit of major federal award programs or state financial assistance projects as of September 30, 2023 due to the total amount expended being less than $750,000. SECTION II FINANCIAL STATEMENT FINDINGS AND RESPONSES None reported. SECTION III FEDERAL AWARDS FINDINGS AND QUESTIONED COSTS Not applicable. SECTION IV STATE PROJECTS FINDINGS AND QUESTIONED COSTS Not applicable. 138 VILLAGE OF TEQEUSTA, FLORIDA SCHEDULE OF FINDINGS AND RESPONSES FOR THE FISCAL YEAR ENDED SEPTEMBER 30, 2023 STATUS OF PRIOR YEAR AUDIT FINDINGS None noted. 139 A T MAULDIN&JENKINS CPAs & ADVISORS INDEPENDENT AUDITOR'S MANAGEMENT LETTER 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, 2023 and have issued our report thereon dated March 11, 2024. Auditor's 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 Reporting Requirements We have issued our Independent Auditor's Report on Internal Control over Financial Reporting and on Compliance and Other Matters Based on an Audit of the Financial Statements Performed in Accordance with Government Auditing Standards; Schedule of Findings and Responses; and Independent Accountant's Report on an examination conducted in accordance with AICPA Professional Standards, AT-C Section 315, regarding compliance requirements in accordance with Chapter 10.550, Rules of the Auditor General. Disclosures in those reports and schedule,which are dated March 11, 2024 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 findings or recommendations in the preceding annual financial report requiring correction. 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. Financial Condition and Management Sections 10.554(1)(i)5.a. and 10.556(7), Rules of the Auditor General, requires us to apply appropriate procedures and communicate the results of our determination as to whether or not the Village has met one or more of the conditions described in Section 218.503(1), Florida Statutes, and to identify 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. 1401 MANATEE AVENUE WEST,SUITE 1200•BRADENTON,FLORIDA 34205.941-747-4483•FAX 941-747-6035•www.mjcpa.com MEMBERS OF THE AMERICAN INSTITUTE OF CERTIFIED PUBLIC ACCOUNTANTS Pursuant to Sections 10.554(1)(i)5.b. and 10.556(8), Rules of the Auditor General, we applied financial condition assessment procedures for the Village. 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. Section 10.554(1)(i)2., Rules of the Auditor General, requires that we communicate any recommendations to improve financial management. In connection with our audit,we did not have any such recommendations. Additional Matters Section 10.554(1)(i)3., Rules of the Auditor General, requires us to communicate 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, the Mayor and Members of the Village Council, and applicable management, and is not intended to be and should not be used by anyone other than these specified parties. Bradenton, Florida March 11, 2024 141 ,f T TV MAULDIN&JENKINS CPAs & ADVISORS INDEPENDENT ACCOUNTANT'S REPORT To the Honorable Mayor,Village Council and Village Manager Village of Tequesta, Florida We have examined the Village of Tequesta, Florida's (the "Village") compliance with Section 218.415, Florida Statutes, regarding the investment of public funds during the year ended September 30, 2023. 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. We are required to be independent and to meet our ethical responsibilities in accordance with relevant ethical requirements relating to the examination engagement. In our opinion, the Village complied, in all material respects, with the aforementioned requirements for the year ended September 30, 2023. This report is intended solely for the information and use of the Village and the Auditor General, State of Florida, and is not intended to be and should not be used by anyone other than these specified parties. Bradenton, Florida March 11, 2024 1401 MANATEE AVENUE WEST,SUITE 1200•BRADENTON,FLORIDA 34205•941-747-4483•FAX 941-747-6035•www.mjcpa.com MEMBERS OF THE AMERICAN INSTITUTE OF CERTIFIED PUBLIC ACCOUNTANTS