The URL can be used to link to this page

2008 GITY OF BANGOR, MAI COMPR H NSIV I�I •� ' � �A�: '� • � � �� E E E �I • _, , . . _ �- �._ . � - • �, � , . � �INANCIAL REPORr � F :� ; � � ` �� , . � , , ,� �, �ISCAL YEAR �F.? ..t �' ; � .� _ , ,� : � .,�. - .�, , � �IJNE �� pa � �� . . � � ,� A �o x N ' �t �°¢i ��. _.j:,' . ,. .w � , �✓ �� -- �,�� . . � ' i'• � ��i� � , __ -- �.- �� 4 I G�� " • � � i1l��' (�....�. i 1�'�� "' � � a _ . �:g .yp '�,. � ._ RIMARY TREATM�' '�a� ;� �f�i' ; . .' .. s '�. "'�i �. . ,��,,�r��r , , � � i�� . t., . � �� . 1 y " � •�� I�i . • .• . l'�� ,�t,� . �� g. , " . -. � ��4'� ,r �. '� '�' ....,f '�:' 1 � .� � , �t• ~ � :._ . �`/ ; ♦ ,1� �. � — .. . .. -. i �y 1 ii �, �l� �f' x�, _ � .. � � _ P, / � � �,' ,� . � t � . , " 4" 0 "_�,�`N ..2f :.M.-- w �j�y-�►+5 � ' :�i yf.'� �` �-' . � � �� ;t�. ',!4 �i R.F� IS', ' ��.(' _ h r VtiEMICAL�� ;� • . � � �e � #:�� s, �; __ . , . - ' � . y � . � 4! • � � . .. . ..�.. � � �� ,�;� ;� , �' .,�y,..��:r�'� '''&'._.:._. - . �• ✓ ..., .... ti .. W�ste Water reat�eet Plant � :.�� : - . P-ro��i�.g t�je �'ev�.oC�scot �or ¢o Yeqrs i ' _ � � . � ' . ,\ . , ) , � � � CITY OF BANGOR, MAINE ! , ; , , , - Comprehensive Annual Financial �Report i r-�� f � _ - : ;�� ' ' _ r For the,Fiscal Year-Ended ]une'30, 2008 � -�� ^_ �� , , . � _ '��->��' � � . ' �-`______ ' � Prepared by: , Debbie Cyr, Finance Director � David Little, Tax Collector/Deputy Treasurer CITY OF BANGOR, MAINE Comprehensive Annual Financial Report Table of Contents For the Fiscal Year Ended ]une 30, 2008 INTRODUCTORY SECTION Paae � Letter of Transmittal I - 1 GFOA Certificate of Achievement I - 8 Organizational Chart I - 9 . Elected Officials and Principal Administrative Officers I - 10 FINANCIAL SECTION �_ � . . .` . Report of Independent Auditors � II - 1 �`. \ Management's Discussion and�nalysis . �,, II - 2 Basic Financial Statements: Exhibit Government-wide Financial Statements: Statement of Net Assets 1 II - 16 Statement of Activities 2 II - 17 ,, . _ Fund Financial Statements: �' ' ` _ Balance Sheet -`Governmental Funds --; :' 3 II - 18 Statement of Re�enues,'Expenditures and'Changes in,!� `�_,�" Fund Balances�-Governmental Funds .�� 4 II - 19 Reconciliation of the.Statement of Revenues, Expenditures �� and Changes in Fund Balances of Governmental Funds � �' � to the Statement of�Activities i� 5 II - 20 Statement of Revenues, Expenditures and Changes in % Fund Balance - Budget and`Actual - General Fund� 6 II - 21 � Statement of Net Assets— Proprietary�Funds �� 7 II - 22 Statement of Revenues, Expenses and Changes in � Net Assets— Proprietary Funds 8 II - 24 Statement of Cash Flows— Proprietary Funds 9 II - 25 � Statement of Fiduciary Net Assets — Fiduciary Funds 10 II - 27 Notes to the Financial Statements II - 28 CITY OF BANGOR, MAINE Table of Contents, Continued � Schedule Paae � Combining and Individual Fund Statements and Schedules: � Balance Sheet- General Fund A- 1 II - 52 Schedule of Revenues, Expenditures and Changes in Undesignated Fund Balance - Budget and Actual - Budgetary Basis - General Fund A- 2 II - 53 . Combining Balance Sheet- Nonmajor Governmental Funds B- 1 II - 57 Combining Statement of Revenues, Expenditures and Changes in Fund Balances - Nonmajor:Governmental Funds B- 2 II - 58 Combining Balance Sheet- Nonmajor"Special Revenue Funds� B- 3 II - 59 Combining Statement of Revenues, Expenditures and Changes in Fund Balance��Nonmajor Special Revenue Funds � B-4 II - 60 • . Combining Balance Sheet� Nonmajor Permanent Funds B- 5 II - 61 Combining Statement of Revenues, Expenditures and Changes in Fund Balances- Nonmajor Permanent Funds ` B- 6 II - 62 � f� Combining Statement,of Net Assets- Nonmajor Proprietary Funds C - 1 II - 63 Combining Statement;of Revenues, Expenses and � Changes in Net Assets - Nonmajor Proprietary Funds C- 2 II - 65 ' Combining Statement;of Cash Flows=Nonmajor Proprietaty".Funds,�` C- 3 II - 66 � r-.�� . Schedules of Revenues, Expenditures and Encumbrances=Budget �-_ ' and Actual Bud eta Basis ' i 1"-"''`` ---�, � �` "� � � � I , Sewer Utility E terp se�Fund �� ,' C- 4 II - 68 Airport Enterprise Fund r l C- 5 II - 69 ` r-��:=.;� , a �, Park Woods Enterprise Fund �'�� . i C- 6 II - 70 � Parking Enterprise Fund � C- 7 II - 71 Bass Park Enterprise Fund � C- 8 II - 72 Municipal Golf Course Enterprise Fund�, �i C- 9 II - 73 Economic Development Enterprise Fund � �-�- C- 10 II - 74 Fiduciary Funds: . Statement of Change in Assets and Liabilities -Agency Fund D- 1 II - 75 Capital Assets Used in the Operation of Governmental Funds: � Schedule of Changes by Function and Activity E - 1 II - 76 Other Information: Assessed Valuation, Commitment and Collections F- 1 II - 77 Undesignated Fund Balance Sufficiency Calculation F- 2 II - 78 CITY OF BANGOR, MAINE ' Table of Contents, Continued STATISTICAL SECTION Table Pa4e � Financial Trends: , Net Assets by Component 1 III — 1 Changes in Net Assets . 2 III — 2 Governmental Activities Tax Revenues by Source 3 III — 5 Fund Balances of Governmental Funds . 4 III — 6 � Changes in Funds Balances of Governmental Funds 5 III — 7 Revenue Capacity: Assessed Value and Estimated Actual Value of Taxable Property 6 III — 8 Property Tax Rate— Direct and O�erlapping Governments 7 III— 9 Principal Properly Taxpayers �� 8 III — 10 Property Tax Levies and Collections ',, 9 III — 11 i Debt Capacity: Ratios of Outstanding Debt by Type 10 III — 12 Ratio of Net General Obligation Debt to Assessed Value and Net Obligation Debt Per Capita � 11 III — 13 Computation of Direct and Overlapping Debt , ,12 III — 14 Legal Debt Margin Information . - 13 III — 15 � �-<.,ri��'� . _ ... - . , . . Demographic and Economic Information: Demographic and Economic Statistics '�: � ' 14 IIi — 16 �//` ;' 15 III — 17 Principal Employers `,, . � � �'�` . _ , , \� Operating Information: \ ,��• -�� - <; �, Full-time Equivalent City Government Employee's`by Function �� 16 III — 18 Operating Indicators by Function �' 17 III — 19 Capital Asset Statistics by Function� �� 18 . III — 20 � . i . " ' . � � � INTRODUCTORY SECTI4N � . � � � � � � � , City of B�� O� 207/992�260 fax 207/945-4446 aine debbie.cyr@bangormaine.gov www.bangormaine.gov FINANCE DEPARTMENT Deborah A. Cyr, Finance Director December 18, 2008 To the Honorable Chairman, Members of the Bangor City Council, and Citizens of Bangor In accordance with the requirements of both our City Charter and state statutes, the City of Bangor's comprehensive annual financial report of the for the fiscal year ended June 30, 2008 is hereby submitted. Responsibility for both the accuracy of the data and the completeness and fairness of the presentation, including all disclosures, rests with the City of Bangor. To the best of our knowledge and belief, the enclosed data is accurate in all material respects and is reported in a manner that presents fairly the financial position and results of operations of the City of Bangor on a government wide and fund basis. The City is responsible for establishing and maintaining an internal control framework designed to ensure that the assets of the City are protected from loss, theft, and misuse and that adequate accounting data is compiled to allow for the preparation of financial statements in conformity with generally accepted accounting principles (GAAP). The internal control structure is designed to provide reasonable, but not absolute, assurance that these objectives are met. The concept of reasonable assurance recognizes that the costs of control should not exceed the benefits likely to be derived and that the valuation of costs and benefits requires estimates and judgments by management. The City's financial statements have been audited by Runyon, Kersteen, Ouellette. The goal of the independent audit is to provide reasonable assurance that the financial statements are free of material misstatement. The independent audit involved examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements; assessing the accounting principles used and significant estimates made by management; and evaluating the overall financial statement presentation. The independent auditor's unqualified opinion is presented as the first component of the financial section of this report. 73 Harlow Street • Bangor, Maine 04401 , The City is required to undergo an annual single audit in conformity with the provisions of the Single Audit Act of 1984 and the U.S. Office of Management and Budget's Circular A-133, Audits of States, Local Government and Non-Profit Organizations. Information related to this single audit, including a schedule of expenditures of federal awards, findings, questioned costs, recommendations, and the independent auditor's reports on the internal control structure and compliance with applicable laws and regulations, are included in a separately � issued single audit report. GASB requires that management provide a narrative introduction, overview, and analysis to accompany the basic financial statements in the form of Management's Discussion and Analysis (MD8cA). This letter of transmittal is designed to complement MD&A and should be read in conjunction with it. The � City's MD&A can be found immediately following the �independent auditor's report. Profile of the Government � The City of Bangor is situated in eastern Maine, is the Penobscot County seat, and is the third most populous of Maine's 22 cities. The City occupies approximately 35 square miles on the western shore of the�Penobscot River. Bangor was first settled in 1656, incorporated as a town on February 25, 1791 and as a city on February 12, 1834. Bangor has become a major trade, distribution, service, and commercial center for the central, eastern, and northern portions of the State. The City operates under a Charter adopted in 1931 that provides for a Council- Manager form of government. The City Council is composed of nine members who are elected at large for three-year staggered terms. The Charter grants to the Council all powers to enact, amend, or repeal rules, ordinances, and resolutions relating to the City's properly, affairs, and government; to preserve the public peace, health, and safety; to establish personnel policies; to give effect to any vote of the City; and to authorize the issuance of debt. The Council adopts an annual budget and provides for an annual audit. The City Manager is � the chief administrative officer of the City and is appointed by the Council, as are the Assessor, Solicitor, and Clerk. The current City Manager has been in his position since 1988. The City's schools are governed by a seven-member School Committee. Its members are elected at large to staggered three-year terms. By Charter, the School Committee has all the powers and performs all the duties related to the care and management of the public schools of the City. The Gommittee annually furnishes to the City Council an estimate of sums required for school purposes for the ensuing municipal year. The City Council makes a single gross I -.2 appropriation for this purpose. Under a recent change in state law, the Council approved school appropriation must be ratified by the voters of Bangor at a referendum held in June prior to the start of the City's fiscal year. Once approved, the expenditure of this appropriation is under the direction and control of the School Committee. The School Committee employs the Superintendent of Schools as its chief operating officer. The past Superin�tendent retired effective ]une 30, 2008 and has been replaced by his Assistant Superintendent. The City provides a full range of municipal services including police and fire, � highways and sanitation, health and welfare, parks and recreation, education, public transportation, planning, business and economic development, code � enforcement, and general administrative services. Bangor International Airport, sanitary sewer services, the Bass Park Complex, parking, golf course, economic development, and a transitional housing complex are accounted for in the City's Enterprise Funds. The City's budgeting process is structured around its fiscal year, which begins on July ist and ends on the following June 30th. The City annually adopts budgets � for its general fund and seven enterprise funds. The City Charter requires that the City Manager submit a recommended budget to the Council by the second Monday in April. The budget, which must be in balance, contains estimates of all non-tax revenues and receipts expected to be received during the next fiscal year, the expenditures necessary to support City operations, debt service . requirements, and the tax levy required to achieve balance between revenues and expenditures. The Council may modify recommended expenditures and the recommended tax levy. If the Council fails to adopt a budget by July 1st, the City Manager's proposed budget automatically becomes t�at fiscal year's budget. In either case, an appropriate property tax levy is establ9shed and filed with the City Assessor who then sets the necessary properry tax rate. � The annual budget serves as the foundation for the City's financial planning and control and is prepared by fund, function, and department. The City Manager may transfer resources within a department; however, transfers between departments require Council action. Special Revenue Funds do not have adopted budgets but have program budgets. Budgetary controls are maintained on other governmental funds through formal , authorizations by the City Council and through grant agreements. All budgets are legally adopted by the Ci.ty Council through the passage of an appropriation resolve. I I = 3 Factors Affecting.Financial Condition - Local economy. The City is the economic, educational, recreational, distribution, and health care center for the central, eastern, and northern Maine regions. Bangor also serves as northern New England's economic link to the Canadian Maritimes and Eastern Quebec. The City is a major center for the communications, banking, commercial, industrial, healthcare, and governmental sectors of the State. � Bangor has a stable and varied economic base. Major employers include a diversified mix of health care, educational, professional, retail, manufacturing, and governmental entities. Bangor's 2007 unemployment rate of 4.8% continues to be on par with both country and state rates of 5.2%, 4.7%, respectively. Bangor is the second largest retail market in Maine after Portland. The Bangor Mall, Airport Mall, Broadway commercial center, Union Street commercial corridor, and the Bangor Center Development District (downtown) have long established Bangor as the hub of the eight-county eastern Maine retail market. Bangor's retail sector serves an extensive geographic area ranging from eastern Maine to the Canadian Maritimes ,yvith a population exceeding 3.1 million. With less than three percent of the State's population, Bangor's share of the State's retail sales has remained in excess of 9% since 1999. Over the same period, Bangor's share of County sales has grown significantly to approximately 71%. Further evidence of continuing sustained growth is the change in:the City's assessed value of real and personal property. The annual increase in assessed value is a combination of three factors: 1) market adjustments to existing properly, 2) new construction/additions and 3) personal properry depreciation. Over the last ten years, the average annual increase in assessed value is 5.7%. Tax base growth, the City's focus on controlling budgetary growth, and ramped up state funding for education resulted in a 21% reduction in the City's tax rate from 1999 to 2008. . The City is committed to preserving its viable economic base while creating new opportunities for future economic growth. To achieve these objectives, the Ciry is proactive in supporting economic activity through planned capital improvements, innovative financing, and aggressive marketing. I - 4 Long-term fnancial planning and major initiatives. Unreserved, undesignated fund balance in the general fund as of June 30, 2008 was 9.66% of expenditures, net of debt service. By Charter, the City is required to maintain a balance between 5% and 10%, and the Council has determined that a reasonable target is 7.5%. � The City prepares a five-year capital plan that is updated at least biannually as part of the overall budget process. The plan identifies all anticipated capital investments as well as potential funding sources. Progress continues in the redevelopment of almost a mile of prime Penobscot River frontage extending from the City's downtown area to the Bass Park Complex. A majority of.the required infrastructure has been installed, for which the City has been successful in obtaining partial funding from both State and Federal agencies. Current plans call for some $180 million in development including: a headquarters hotel and high-technology conference center, new class A office space, restaurant and retail space, residential apartments and condominiums, and other private sector projects. " The City has entered into a development agreement with Bangor Historic Track, a wholly owned subsidiary of Penn National Gaming, to redevelop Bangor Raceway and a portion of the surrounding Bass Park property. Penn National Gaming opened a temporary gaming facility containing 475 slot machines in November 2005 and opened its permanent facility, including a hotel, in the summer of 2008. Under this agreement, the City receives a percentage of gross slot revenue as well as land lease payments and properry taxes on new development. In October 2005, the City established a special revenue fund to . account for all such payments. In addition, the Council Order establishing this fund specifies that its primary-use will be to construct a new arena in Bangor to replace the Bangor Auditorium which opened in Bass Park in 1954. � I - 5 Over the years, the City has invested significant resources and effort in improving our local environment and protecting our natural resources, includingh: remediation work on the waterfront, a former gas works site, and a former laundry/dry cleaning establishment, and significant investment in separating sewer and stormwater systems as well as installing a de-icing fluid capture system at Bangor International Airport. In addition, the past year has seen an emphasis on storm water management issues that will continue into the near term future. Storm water quality requirements and related regulations affect various water bodies within our corporate limits. At this time, a number of watershed management plans are in various stages of development and implementation throughout the City. In conjunction with surrounding communities and various interested parties, the City is participating in a regional open space plan. The plan will use "greenprinting" and geographical information systems to. identify appropriate areas within our region for public and private open space. The City continues to work with all interested parties to implement a comprehensive approach adopted to address land use issues related to the Penjajawoc Marsh area adjacent to the Bangor Mall. In order to achieve significant long term energy savings as well as to provide environmental, occupant comforf, and indoor air quality improvements, the City has undertaken an energy audit of all its facilities. Implementing the results of this effort will begin in the coming fiscal year. The City is currently undertaking a . number of capital improvements recommended by the audit in order to reduce energy use and related costs. To date, all projects undertaken are guaranteed by our energy services contractor to generate adequate annual savings to fund � . the annual payments required to finance these improvements. In addition to improving its current facilities, the City has adopted a policy that will require all new construction and major renovations to City owned or funded buildings to meet Leadership in Energy and Environmental Design (LEED) certification. Awards and Acknowledgements. The Government Finance Officers Association of the United States and Canada (GFOA) awarded a Certificate of Achievement for Excellence in Financial Reporting to the City of Bangor for its comprehensive annual financial report for the fiscal year ended ]une 30, 2007. This was the eleventh consecutive year that the City has achieved this prestigious award. In order to be awarded a Certificate of Achievement, a government must publish an easily readable and efficiently organized comprehensive annual financial report. This report must satisfy both generally accepted accounting principles and applicable legal requirements. . I - 6 A Certificate of Achievement is valid for a period of one year only. We. believe that our current comprehensive annual financial report continues to meet the Certificate of Achievement Program's requirements, and we are submitting it to the GFOA for consideration for another certificate. The preparation of this document would not have been possible without the hard work of all of the City's employees. Each one contributes on a daily basis, simply by carrying out the responsibilities of their positions. Our sincerest �thanks are once again extended to our Citizens and the Bangor City Council for their continued support for our efforts to further develop the City's financial management and reporting capabilities. We are confident that we have once again met their expectations. Respectfully submitted � . . Debbie Cyr Finance Director � I - 7 . This page left intentionally blank , . , . , - � � Certificate of � . Achlevement � �� . �� for Excellence � � � � � in .Financial � � . � � . . . � �eporting � � � Presented to � � _ � � City of Bangor � � � Maine � � • . � � . For its Comprehensive Annual� � Financial�N�port . � � for the Fiscal Year Ended � � . � �June 30,2007 � � � A Certificate of Achievement for Excellence in Financial ` Reporting is presenteJ by the Government Finance Of�"icers . � Association of the LJnited States and Canada to , government units and public employee retirement systerns whose comprehensive annual financial . ' ' reports(CAFRs)achieve the highest ' � . standards in government accounting � � ' .' � and fmancial reporting. ' � . . otx�e �"��,�.,�'�' _ �. �� , . . �� & . : � � �,,,,� ,� � President � �' . . , �. . ��%�.�� ' . Executive Director ` CITY OF BANGOR ORGANIZATIONAL CHART Revised (06-08) • , • - ` CITIZEN CITY CITIZEN COMMISSIONS COUNCIL BOARDS CITY ASSESSING SOLICITOR MANAGER CLE K RECORDS ELECTIONS VOTER - REGISTRATION FINANCE INFRASTRUCTURE AND GOVERNMENT COMMUNITY& BANGOR BASS � DEVELOPMENT SUPPORT OPERATIONS ECONOIVIIC DEV. INTERNATIONAL PARK AIRPORT COMMUNITY CIVIC AUDITING CODE POLICE FIRE HEALTH DEVELOPMENT CENTER ENFORCEMENT " AND DETECTIVE FIRE COMMUNITY ECONOMIC AUDITORIUM TREASURY PLANNING � FIGHTING SERVICES DEVELOPMENT STATE. PATROL FIRE FAIR RISK& PREVENTION BANGOR DOWNTOWN ENVIRONMENTAL ENGINEERING ADMINISTRATION BUREAU REGION PROGRAMS MANAGEMENT PUBLIC SERVICES HEALTH & pARKING - ADMINISTRATION WELLNESS MANAGEMENT INFORMATION PUBLIC WORKS DIVISION SERVICES ANIMAL ADMINISTRATIVE ' CONTROL SERVICES PURCHASING HARBOR HUMAN RESOURCES HOUSING& P.ARKS AND COMMUNITY WASTEWATER RECREATION SERVICES TREATMENT LABOR DIVISION PARKS RELATIONS � SEWER MAINTENANCE BAT MAINTENANCE RECREATION COMMUNITY CONNECTOR GOLF FLEET . COURSE MAINTENANCE CENTRAI SERVICES City of Bangor, Maine Elected,OfFcials and Principal Administrative Officers � .7une 30, 2008 _ City Council Susan M. Hawes, Mayor Patricia A. Blanchette � Peter R. D'Errico� Frank]. Farrington , Geoffrey M. Gratwick Gerry G.M. Palmer Richard I. Stone � . Harold A. Wheeler • City Staff Edward A: Barrett, City Manager . Benjamin F. Birch, City Assessor Patti Dubois, City Clerk ° � Norman Heitmann, City Solictor School Committee Phyllis S. Guerette, Chair ' Mary Budd Nichi Farnham Martha G. Newman Fhyllis�M. Shubert Christine Szal, Vice Chair . C. Jeffery Wahlstrom � School Staff ' � Robert Ervin, Superintendent of Schools 1 , I - 10 , � � � FINANCIAL SECTION � � � . . � � � � . , . � � � . �_ � -' � , Jzuvc an. � � �Gers�eevc -� . Oueltette� Certified Public Accountants and Business Consultants : Independent Auditor's Report City Council � City of Bangor, Maine i 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 City of Bangor, Maine as of and for the year ended June 30, 2008, which collectively comprise the City's basic financial ! statements as listed in the table of contents. These financial statements are the responsibility of the City of Bangor, Maine's management. Our responsibility is to express opinions on these financial ' statements based on our audit. � ` We conductec! our audit in accordance with auditing standards generally accepted in the United States t of America and the standards applicable to financial audits contained in Government Auditing Standards, issued by the Comptroller General of the United States. Those standards require that we , plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the � amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used and the significant estimates made by management, as well as evaluating the overall ` financial statement presentation. We believe that our audit provides a reasonable basis for our opinions. , In our opinion, the financial statements referred to above present fairly, in all material respects, the respective financial position of the governmental activities, the business-type activities, each major fund, and the aggregate remaining fund information of the City of Bangor, Maine, as of June 30, 2008, and the respective changes in financial position, and cash flows, where applicable, thereof and the budgetary comparison for the General Fund for the year then ended in conformity with accounting principles generally accepted in the United States of America. In accordance with GovernmentAuditing Standards, we have also issued our report dated December 15, 2008, on our consideration of the City of Bangor, Maine's internal control over financial reporting and on our tests of its compliance with certain provisions of laws, regulations, contracts and grant agreements and other matters. The purpose of that report is to describe the scope of our testing of internal control over financial reporting and compliance and the results of that testing, and not to provide an opinion on the internal control over financial reporting or on compliance. That report is an integral part of an audit performed in accordance with Government Auditing Standards and important for assessing the results of our audit. The Management's Discussion and Analysis, as listed in the table of contents, is not a required part of the basic financial statements but is supplementary information required by accounting principles generally accepted in the United States of America. We have applied certain limited procedures, which consisted principally of inquiries of management regarding the methods of ineasurement and presentation of the required supplementary information. However, we did not audit the information and express no opinion on it. City Council Page 2 - Our audit was conducted for the purpose of forming opinions on the financial statements that collectively comprise the City of Bangor, Maine's basic financial statements. The�introductory section, � combining and individual nonmajor fund financial statements and schedules, and statistical section are presented for purposes of additional analysis and are not a required part of the basic financial statements. The combining and individual nonmajor fund financial statements and schedules have been . subjected to the auditing procedures applied in the audit of the basic financial statements and, in our opinion, are fairly stated in all material respects in relation to the basic financial statements taken as a whole. The introductory and statistical sections have not been subjected to the auditing procedures applied in the audit of the basic financial statements and,accordingly,we express no opinion on them. �� December 15, 2008 South Portland, Maine , , MANAGEMENT'S DISCUSSION AND ANALYSIS , Management of the City of Bangor offers this�narrative overview and analysis of the financial activities of the City for the fiscal year ended June 30, 2008. In addition to . comparative information from the government-wide statements, comparative data is presented on key information from the fund financial statements. We encourage � readers to consider the information presented here in conjunction with additional information that is furnished in our letter of transmittal, which can be found on pages I- 1 to I-7 of this report. ' Financial Highlights , • The assets of the City of Bangor exceeded its liabilities at the close of the most , recent fiscal year by $213.1 million (net assets). • As of the close of the current fiscal year, the City of Bangor's governmental funds ' reported combined ending fund balances increased $7.6 million from the prior year , to $28.2 m�illion. Approximately 62% of the total amount, or $17.5 million, is available for spending at the City's discretion (unreserved fund balance). ' • The City of Bangor has a fund balance policy. The City strives to maintain a general fund unreserved/undesignated fund balance of 5% to 10% of current expenditures less debt service. At the end of the current fiscal year, unreserved undesignated ( fund balance for the General Fund was $8.0 million, or 9.66% of the general fund expenditure base. The annual calculation is included within the financial statements as Schedule F-2. • The total liabilities of the City's governmental and enterprise funds decreased by $2 million (2.7%) and $2.6 million (5.4%), respectively. The change in governmental fund liabilities is primarily due to principal payments of $ 3.3 million, an increase of $600 in accounts payable within the General and Capital Projects Funds, a $300 thousand increase in accrued wages and benefits, and a $300 thousand increase in deferred taxes. The decrease in enterprise fund liabilities is due to principal repayments exceeding new debt issued by $2.1 million and a decrease of $600 . thousand in accounts payable. Accounts payable can vary drastically from year to year depending upon the timing of invoices received and/or the projects being undertaken. � Overview of the Financial Statements This discussion and analysis is intended to serve as an introduction to the City of Bangor's basic financial statements. These statements consist of three components: government-wide financial statements, fund financial statements, and notes to the financial statements. This report also contains other supplementary information in addition to the basic financial statements themselves. Government-wide fnancial statements. The government-wide financial statements present the financial picture of the City from the point of view of economic resources measurement and using the accrual basis of accounting, which is similar to that used by private-sector companies. These statements present governmental activities and business type activities separately. II - 2 The statement of net assets includes all of the City's assets and liabilities, with the difference between the two reported as net assets. Over time, increases or decreases in net assets may serve as a useful indicator of whether the financial position of the City is � improving or deteriorating. The statement of activities presents information showing how the City's net assets changed during the most recent fiscal year. All changes in net assets are reported as soon as the underlying event giving rise to the change occurs, regardless of the timing of related cash flows. Thus, revenues and expenses are reported in this statement for some items that will only result in cash flows in future fiscal periods (e.g. uncollected taxes and earned but unused employee vacation leaves). These statements are divided into two categories: governmental activities and business- type activities. • Governmental activities — Most of the City's basic services are included here, such as the general government, public safery, public works, health and welfare, education, and parks and recreation. These activities are principally supported by taxes and intergovernmental revenues. • Business-type activities — Cur.rently, the City operates the following business-type activities: Bangor International Airport, Sewer Utility, the Bass Park Complex, Parking, Golf Course, Economic Development, and the Park Woods Complex. � The government-wide financial statements can be found on pages II-16 to II-17 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 City of Bangor, like other state and local governments, uses fund accounting to ensure and demonstrate compliance with finance-related legal requirements. All of the funds of the City can be divided into three categories: governmental funds, proprietary funds, and fiduciary 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 are reported using an accounting method called modified accrual � accounting that measures cash and all other financial assets that can readily be converted to cash. Both the governmental fund balance sheet and the governmental fund statement of revenues, expenditures, and changes in fund balances provide a reconciliation to facilitate a comparison between governmental funds and � governmental activities. The City of Bangor maintains ten 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, Community Development Block Grant, Racino fund, and Capital Projects Fund, all of which are considered to be major funds. Data from the other six governmental funds are combined into a single aggregated II - 3 � presentation. Individual fund data for each of these non-major governmental funds is provided in the form of combining statements (Schedule B) elsewhere in this . report. The City of Bangor adopts an annual budget for its general fund. A budgetary comparison statement has been provided for the general fund to demonstrate compliance with this budget (Schedule A-2). • Proprietary funds are used to account for essentially the same functions reported as business-type activities in the government-wide financial statements. Enterprise funds are the only type of proprietary funds maintained by the City. The proprietary fund statements provide the same type of information as the government-wide statements, only in more detail. The City malintains seven individual proprietary funds, the Sewer Utility and Airport Fund are considered to be major. Data from five other proprietary funds is combined into a single aggregated presentation. Individ'ual fund data for each of these non-major proprietary funds is provided in the form of combining statements (Schedule C) elsewhere in this report. The City of Bangor adopts annual budgets for all of its proprietary funds. Budgetary comparison statements have been provided for each proprietary fund to demonstrate compliance with budgets (Schedule C4 — C10). • Fiduciary funds are used to account for resources held for the benefit of parties outside the City. Fiduciary funds are not reflected in the government-wide financial statements because the resources of those funds are not available to support the City's own programs. The accounting used for fiduciary funds is much like that used for proprietary funds. The Fiduciary Statement of Net Assets is included in this report as Exhibit 10. . Notes to the f�inancial statements. The notes provide additional information that is essential to a full understanding of the data provided in the government-wide and fund financial statements. The notes to the financial statements can be found on pages II-28 through II-51 of this report. II - 4 Government-Wide Financial Analysis The following is a condensed version of the Statement of Net Assets. • Governmental Business-type Activities Activities Total 2008 2007 2008 2007 2008 2007 Current&other assets . 41,292,025 32,045,317 28,555,418 28,732,848 69,847,443 60,778,165 Capital assets, net 73,014,076 73,854,037 188,398,368 191,640.571 261,412,444 265.494,608 Totalassets 114,306,101 105,899,354 216,953,786 220,373,419 331,259,887 326,272,773 Long-term debtoutstanding 60,626,396 63,926,125 43,327,315 45,258,758 103,953,711 109,184,883 Other liabilities 11,859.022 10,565,677 2 339.582 2,992,321 14,198.604 13.557,998 Total liabilities 72,485,418 74,491,802 45,666,897 48,251,079 118,152,315 122,742,881 Net assets: Invested in: Capital assets, net of related debt 49,447,154 48,257,039 154,066,934 154,897,152 203,514,088 203,154,191 Restricted 7,528,782 1,025,700 - - 7,528,782 1,025,700 Unrestricted �15,155,253�f17,875,187� 17,219,955 17,225,188 2,064,702 �649,999� Total net assets 41,820,683 31,407,552 171,286,889 172,122,340 213,107,572 203,529,892 By far the largest portion of the Ciry's net assets (95% or $203.5 million) reflects its investment in capital assets (i.e. land, buildings, machinery and equipment) less any related outstanding debt used to acquire those assets. The City uses these capital assets to provide services to citizens. Consequently, these assets are not available for future spending. Although the City'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 satisfy these liabilities. Restricted net assets are those resources that are subject to external restrictions on how they may be used. While the remaining balance of unrestricted net assets is approximately $2.1 million, the governmental activity portion shows a deficit of $15.2 million. This is primarily due to $26.9 million in outstanding pension obligation bonds. The City is able to report positive balances in the remaining two categories of net assets for the government as a whole. Business-type activities net assets continue to remain positive in all categories. Governmental-rype net assets increased by $10.4 million, and business-type net assets decreased by $800 thousand during the year. Within the governmental-type funds, $6.5 million is a result of a third party settlement related to the remediation of coal tar in the Penobscot River, the remaining increase is related to actual revenues outpacing estimates, specifically in the areas of, state revenue sharing, building and electrical permits, and racino fund revenues. The business-type net asset decrease was due to the expensing of a variety of project related expenses that did not meet the threshold or definition for capitalization as a capital asset. II - 5 Changes in Net Assets The following is a condensed version of the Statement of Activ�ties. Governmental Business-type Activities Activities Total 2008 2007 2008 2007 2008 2007 Revenues Program Revenues Charges for services 16,979,412 16,487,735 25,068,331 24,696,844 42,047,743 41,184,579 Operating grants&contributions 41,370,518 30,534,706 - - 41,370,518 30,534,706 Capital grants&contributions 2,119,150 2,604,652 3,426,732 4,316,902 5,545,882 6,921,554 General Revenues Properry and other taxes 48,840,536 46,812,955 - - 48,840,536 46,812,955 Grants and contributions not Restricted to specific programs 5,520,774 4,968,217 - - 5,520,774 4,968,217 Other 1,436,378 1,444,529 1,326,787 1,392,375 2,763,165 2,836,904 Total Revenues 116,266,768 102,852,794 29,821,850 30,406,121 146,088,618133,258,915 Expenses General government 8,744,549 7,052,860 - - 8,744,549 7,052,860 Public safety 14,945,855 13,756,962 - - 14,945,855 13,756,962 Health, communiry and recreation 8,413,205 7,348,875 - - 8,413,205 7,348,875 Public buildings and services 9,142,251 8,659,473 - - 9,142,251 8,659,473 Otheragencies 4,829,547 3,787,970 - - 4,829,547 3,787,970 Education 47,537,197 46,106,647 - - 47,537,197 46,106,647 Unclassified - 397,851 - - - 397,851 Arena Development 41,091 417,030 - - 41,091 417,030 Community development 2,156,241 1,865,026 - - 2,156,241 1,865,026 Streets/sidewalks 1,359,002 2,884,655 - - 1,359,002 2,884,655 Watertront 1,754,281 399,015 - - 1,754,281 399,015 Public transportation 2,118,374 1,841,516 - - 2,118,374 1,841,516 Interest on debt 3,206,764 3,135,278 - - 3,206,764 3,135,278 Tax increment financing 1,066,192 1,101,078 - - 1,066,192 1,101,078 Sewer Utility - - � 6,052,419 6,353,825 6,052,419 6,353,825 Airport - - 19,641,953 18,645,140 19,641,953 18,645,140 Park Woods - - 678,867 498,678 678,867 498,678 , Parking , - - 1,438,125 1,390,863 1,438,125 1,390,863 Bass Park - - 1,993,205 1,984,042 1,993,205 1,984,042 Municipal Golf Course - - 695,969 657,809 695,969 657,809 Economic Development - - 695,851 692,138 695,851 692,138 Total Expenses 105,314,549 98,754,236 31,196,389 30,222,495 136,510,938128,976,731 Excess(deficiency) before transfers 10,952,219 4,098,558 (1,374,539) 183,626 9,577,680 4,282,184 Transfers (539,088) (871,864) 539,088 871,864 - - Change in net assets 10,413,164 3,226,694 (835,451) 1,055,490 9,577,680 4,282,184 II - 6 Governmental Activities . The cost of all governmental activities was $105.3 million. As shown on the Statement of Activities, the total amount financed by the City's property taxpayers was $43.8 million, or 41.6%. Those who directly benefit from an activity provided $17 million in payments. Other governments and organizations subsidized certain activities with operating grants and contributions in the amount of $41.4 million. Capital grants and contributions accounted for $2.1 million. The City also received $12 million in other general revenues such as State Revenue Sharing, motor vehicle and boat excise taxes, homestead exemptions, and interest earnings. E�enses and Program Revenues - Governmental Activities 45 i 40 3 5 �, 30 0 25 �� 20 c _ 15 `� ,I � 5� 0 Expenses � I � , i_ ■Revenues - 0 �� ,� ��y�o�c �� p° , ��Q ffi�� c�' ��c�� ` �c��`�� J�� ` &�� o0 a � 4� � �' �,a c a c,� \�'o Q��o y �Zc� P o�F � `ac `�zr �c��a ��\�c � � - �� c�� J� V QJ�\,�,vo�C.� Q a, �� 'Total governmental activities expenses increased $6.5 million over the prior year. With the exception of approximately $600 in a one time Health and Community services grant project, no additional programs were sponsored by the City in the current year, nor were any eliminated. The majority of increased costs are related to personnel, fuel, waterfront, and other agencies. Employees received a "3% cost of living adjustment and, while health insurance premiums increased approximately 40%, a change in the City's contribution rate coupled with employees changing coverage types kept the impact on the budget to 12%. Fuel costs increased dramatically during the year, resulting in a 25% increase in costs. The increase in waterfront is related to the City's requirement to fund legal fees and study costs related to the remediation of coal tar deposits in the Penobscot River. Lastly, the increase in other agencies is due to capital contributions made to an unrelated non-profit in accordance with the agreement executed at the time the entity was created and an increase in the county tax. II - 7 Revenues by Source-Govemmen�l Activities 0 5% 1% o pCharges for Services �Operating Grants& Corrtributions ❑Capital Grants&Contributions , ❑Property Taxes � 37% ■Other Generel 3 % OUnrestricted Grants & o • Corrtributions . �Othe r U n restricted While total governmental activities revenues increased $13.4 million, or 13%, of that increase, $7.6 million is related to a one-time settlement related to coal tar remediation in the Penobscot River. The remainder reflects a continued increase in State Aid to Education of $1.1 million, additional grant funds of $1 million for health related programs, and an $800 thousand increase in Community Development Block Grant funds expended. The largest singte source of revenue continues to be the property tax, which declined slightly to 37% of total revenues for 2008 compared to 40% for 2007. Revenue from services provided remained stable while property tax revenue increased $2 million. Of the 2008 increase in tax revenues, nearly $1.8 million is attributable to new value as defined by LD 1, which translates into $94.6 million of new development/improvements within the City during the prior fiscal year. e Business-type Activities Total business-type activities�expenses increased 3.3%, or $1 million, over the prior year. Within the Sewer Fund, there were a significant number of equipment upgrades. The Airport continues to see increased numbers of international flights requiring services. Most of these flights are directly related to military troop movements. The additional costs associated with servicing this market are recovered through additional revenue from charges for services. In addition, business-type activities experienced the same increases as noted above in the governmental activities such as: employee cost of living�adjustments, increased health insurance, and fuel costs. II - 8 Expenses and Program Revenues - Business-type Activities zo 18 16 14 � 12 �Expenses 0 = 10 ■Reven ues � c g 6 4 2 i 0 � ��J c�� o' � c`5� �oQ J'o PQ �o � � �oJ �� i�� a•� � �a� �� O Q �� Revenues by Source- Business-type Activities U nrestricted Transfers Investment Capital Grants and Zo�o Contributions Earnings 11% 4% ■Charges for Services - ,r:,- Charges for ■Capital Grants and Services Corrtributions 830�0 ❑Transfers ❑Unrestricted Investment Eamings ln total business-type activities revenue was flat; however, there was a fluctuation between capital grants and contributions and charges for services. The increase in charges for services within the Airport is due to the increased number of international flights, specifically those tied to military troop movements. The decrease in capital grants and contributions within the Airport reflects the cyclical nature of Airport Improvement Plan grant funding. Lastly, in FY 2007, the Economic Development fund sold significantly more assets, in the form of vacant land, than normal. II - 9 Financial Analysis of the Government's Funds Governmental funds. The focus of the City's governmental funds reporting is to provide information on near-term inflows, outflows, and balances of expendable resources. Such information is useful in assessing the City's financing requirements. In particular, unreserved fund balance may serve as a useful measure of the net resources available for spending at the end of the fiscal year. At fiscal year end, the City of Bangor's governmental funds reported combined ending fund balances of $28.2 million, an increase of $7.7 million from the prior year balance of $20.5 million, the majority of which, or $6.5 million, is an increase in reserved fund balances. Approximately 62% of this total ($17.5 million) constitutes unreserved fund balance that is available for spending at the City's discretion. The remainder is reserved, indicating that it is not available for new spending because it has already been committed for various purposes including liquidating prior period contracts and purchase orders ($1.9 million), reserving for potential non-repayment of interfund balances ($1.7 million), restricted unexpended escrow funds received to fund coal tar remediation in the Penobscot River ($6.5 million), or set aside for a variety of other restricted purposes ($700 thousand). The general fund is the chief operating fund of the Ciry and is comprised of two major functions, education and municipal services. At the end of the fiscal year, the total unreserved fund balance of the general fund was $11.6 million ($3.6 million of which has been designated by management for subsequent years' expenditures). The general fund's total fund balance was $14.2 million, an increase from the prior year's balance of $13.8 million. Designated fund balances increased $400 thousand due to a transfer of savings realized by the City's change in group health insurance carriers. The City's undesignated fund balance decreased $300 thousand as increased revenue collections in the area of State Revenue sharing and increased interest earnings did not outstrip the use of fund balances. Over the last few years, the City has consistently exceeded its 7.5% undesignated fund balance target. In order to bring our undesignated fund balance into line with the Council's established policy, the City appropriated $550 thousand from this balance during fiscal year 2008 to fund further environmental assessment and associated legal costs related to the Penobscot River as well as $200 thousand to match a $450 thousand grant to purchase a new combined pumper and ladder unit for the Fire Department. Proprietary funds. Information on the City of Bangor's proprietary funds is similar to that found in the government-wide financial statements, but in more detail. The unrestricted net assets of the seven enterprise funds decreased $800 thousand to a total of $171.3 million, including net asset deficits of $1.7 million in the Bass Park Fund and $400 thousand in the Parking Fund. Without exception, the net assets of all other enterprise funds were relatively stable. II - 10 General Fund Budgetary Highlights For budgetary financial statement purposes, all balances carried from the prior year are added to the subsequent year's total appropriation. This resulted in an overall budgetary increase of $2.3 million. There were minimal additional amendments to the originally adopted budget. The City's commitment to budgetary integrity continues, with actual revenues exceeding budgeted amounts by 2.3%, or $2 million, while municipal expenditures were under budget by 2.8%, or $2.5 million. All of the under expenditure is related to education, and, by statute, education balances must be segregated from municipal balances. Capital Asset and Debt Administration � Capital assets. As of June 30, 2008, the City of Bangor's investment in capital assets for its governmental and business-type activities amounted to $261.4 million (net of accumulated depreciation), a decrease of $4.1 million over the prior year. This investment includes land, buildings, machinery and equipment, roads, runways, and sewer lines. The total increase in the City's investment in capital assets for the current fiscal year was minimal when netted against current year depreciation expense. Governmental activities investment was flat, while business-type activities invested $6.5 million. � Major capital asset events during the current fiscal year included the following; • The Economic Development fund renovated an existing rental property and invested in roads and infrastructure to afford better accessibility to available business park . lots. • The Sewer Fund continued its aggressive combined sewer overtlow control program in the amount of$1.95 million. • The Airport Fund invested $3.5 million in operational assets at Bangor International Airport including additions to the terminal and Avitat buildings, expanding on-site parking facilities, and upgrading and improving runways and aprons. Capital Assets (net of depreciation) Governmental Business-type Activities Activities Land and improvements 9,864,083 4,677,289 Buildings and improvements 40,833,823 16,379,220 Machinery and equipment 4,276,115 1,792,641 Vehicles � 5,981,209 � _ Infrastructure 11,511,046 45,547,261 Parking structures - 2,915,179 Aircraft operational assets - 113,575,096 Construction in process 547,800 3,511,682 Tota I 73,014,076 188,398,368 , II - 11 Additional information on the City's capital assets can be found in Note C, Detailed Notes on all funds; of this report. Bonded Debt Outstanding (in millions) i gai.� � p Governmenta f Activities ■Business-type Activities 57.0 Debt Administration At fiscal year end, the City had a total outstanding bonded debt of $98.7 million, a decrease of $5.4 million during the year. The City's general obligation debt maintained a "AA-" rating from Standard & Poor's and a "Aa3" rating from Moody's. State statutes limit the amount of general obligation debt a governmental entity may issue to 15% of its total State assessed valuation. The current debt limit for the City is $353.7 million, an amount which is significantly in excess of existing general obligation debt. Additional information on the City's long-term debt can be found in Note I on pages II- 41 to II-44 of this report. � Economic Factors and Neut Year's Budget and Rates • The unemployment rate for the City of Bangor for calendar year 2007 was 4.8% which is on par with the State's rate of 4.7%. • While Bangor represents less than 3% of the state's population, the City's share of retail sales remains in excess of 9% of total statewide sales and 71% of Penobscot County sales. • The increase in residential construction that began in 2002 has continued, albeit at a slower pace, and without a need for the City to significantly improve infrastructure to accommodate this growth. • Bangor has experienced a slowing in the rate of appreciation of existing homes. We project that existing home values will flatten out in the coming year compared to the 5% to 7% range experienced in recent years. Bangor remains the only municipality in Maine that has met the requirements of state law that allow for the operation of slot machines at commercial harness racing tracks. - In November 2005, Penn National Gaming opened a "racino" at an interim location in � II - 12 - :�� 1 the Ciry. Construction of the permanent gaming facility began in the spring of 2007, and it opened in the summer of 2008. This facility includes a 1,500 car parking garage, a 152 room seven story hotel, and approximately 110,000 square feet for gaming. The'. project cost approximately $131 million. � The Council has adopted a policy directing all rents and state taxes received from the - operation of the slot facility to a separate special revenue fund, the Racino Fund. The primary purpose of this fund is to provide the necessary resources to construct a new arena to replace the Bangor Auditorium which opened in Bass Park in 1954. The City is subject to a state statutory system (known as LD 1) that is designed to limit the increase in that portion of the tax levy that supports municipal functions. Generally, the growth of the tax levy is limited to an increase equal to the ten year average � percentage change in real statewide personal income plus taxes from property value resulting from new construction, major renovations to existing properties, or the subdivision of properry. In addition, any ��net new state funding," must be deducted from the allowable tax levy increase. For Fiscal Year 2008, the City's LD 1 tax levy limit was as follows: Prior Year Based Municipal Commitment $ 18,100,084 , Growth Factor: 7.33% Average Real Personal Income, 2.47% Property Growth Factor 4.86% Net New State Funds - Municipal Commitment Limit $ 19,427,427 The adopted budget was within the statutory tax levy limit. For Fiscal Year 2009, the City Council voted to increase the City's property tax levy limit by $484,791 in recognition of the unprecedented (80%) increase in fuel pri�es which occurred just prior to adopting the budget in June 2008. LD 1 increased the State's share of local education costs through the "Essential Programs and Services" model, a mechanism designed to allocate state funding to local school units and to control local school expenditures. This model sets forth a comprehensive methodology for computing the cost of providing essential educational programs to Maine's children. It also establishes a schedule designed to increase the State's share of total Essential Programs and Services costs to 55% over a four year period.- Due to this change, the City received approximately $1.1 million more in State School Aid for the fiscal year ending June 30, 2008. While the State's model recognizes what it considers to be essential programs and their appropriate funding level, the Bangor School Department has identified a number of programs that are either under- funded or not funded by this model. As a result, both the School Committee and the City Council voted to increase the educational spending limits imposed by LD 1 for both Fiscal Year 2008 and 2009 in order to appropriately fund such services and programs. II - 13 In accordance with "School .Administratiye Reorganization" (SAR), legislation, which mandates the consolidation of certain school units in Nlaine, the Bangor School Department submitted an alternative organizational plan to the Maine Department of Education under which it would maintain it's current status as a separate municipal department under the arrangements set forth in the Charter of the City of Bangor has ` been accepted. This alternative plan was subsequently approved by the State. The intent of this legislation is to ensure that schools are organized in units of sufficient size to provide equitable educational opportunities, rigorous academic programs, uniformity in delivering programs, greater equity in tax rates, more efficient and effective use of limited resources, preservation of school choice, and maximized opportunity to deliver educational services in an efFicient manner. In response to the extreme uncertainty surrounding the national economy, management has been closely tracking not only revenues and expenditures, but also foreclosure, liens, unemployment rates, construction starts and related building permit levels, and the State of Maine's budgetary projections. To date, the City has seen only slight increases in foreclosure and lien rates and will continue to monitor these levels and take steps to assist our tax/rate payers in obtaining assistance wherever possible. While residential construction and permitting has slowed, commercial construction has remained steady. At this time, we do not anticipate any shortfalls in construction related permit fees, and we estimate new additions to the City's tax base for fiscal year � 2010 will be only slightly below the 2008 and 2009 levels of 4.86% and 4.0%, respectively. The State of Maine's most recent estimated budgetary shortfall for fiscal year 2009 is $140 million. The projected State response to this shortfall is estimated to primarily impact the City through a reduction in State Aid to Education of $530 thousand and a decrease in Revenue Sharing of $370 thousand. The reduction in State Aid to Education will be absorbed through the use of school reserves and deferring minor capital improvements and will have no immediate impact on operations. Due to the conservative approach taken by the City in its revenue assumption for fiscal 2009, the revised Revenue Sharing estimates should have no impact on the City. Management will closely monitor the activities of the Maine State Legislature's session beginning in January 2009 to identify and monitor proposed actions that may have financial and operational impacts on the City. We continue to monitor additional revenue areas such as: flat investment yield curves and a potential decline in automobile excise taxes. The fiscal year 2009 budget anticipates a decrease from 2008 levels for both of these revenue sources, and year to date receipts are tracking at or slightly ahead of our 2009 estimates while recognizing that there are still six months left in our fiscal year. As for expenditures, we have not experienced the unprecedented benefit� utilization or rate increases seen last year in our health insurance costs, resulting in a return to our historical average annual cost increases of 10%. During the fiscal year 2009 budget process, the largest single challenge was the unprecedented increase in fuel prices. Between heating our buildings, the unleaded gasoline used by our police vehicles, and the diesel consumed by public works, public transportation, and our fire department, we projected an energy related cost increase of $700 thousand or 80% over prior year II - 14 levels. The total estimated increase was mitigated by the fact that the City, the Schools, and Airport were in the process of undertaking $11.2 million in energy conservation improvements that are guaranteed to generate savings sufFicient to cover annual financing costs. Implementation of these improvements is expected to reduce energy consumption in these facilities by 14% annually. Within the last few months, energy costs have eased significantly over the levels anticipated in the 2009 budget. User fees for governmental and business-type activities are reviewed on an annual basis to ensure that fee structures are sufficient to cover service costs. Many fees are - adjusted annually for inflation. A 5% increase in sewer fees will be implemented effective January 1, 2009, only the third sewer fee increase since March 1996. Requests for Information This financial report is designed to provide our citizens, taxpayers, customers, investors, and creditors with a general overview of the City of Bangor's finances. Questions concerning any of this information should be addressed to the Finance Director, City of Bangor, 73 Harlow Street, Bangor, ME 04401. II - 15 BASIC FINANCIAL STATEMENTS � , . , � ; . . f � � ,, ; . � �� _ . , - . Ek �.,i� •. y - ''. � l�y � - _-- � , . 1 ' �'��__._,� � 1 : l ` � _ r. "i� I , ` /. . � �s��1'� � .. � . �� ,,q C'?C7' - �.._.� , � Exhibit 1 CITY OF BANGOR,MAINE Sfatement of Nef Assets ; June 30,2008 " Governmental Business-type � Activities Activities Totai � � ASSETS Cash and cash equivalents $ 2;309,105 $ 553,573 $ 2;862,678 Investrnents 18,364,660 20,504,721 38,869,381 Receivables: Accounts(net of allowance of $264,892 and$286,849,respectively) 94`1,348 6,252,702 7,194,050 Intergovernmental 4,055,730 226,274 4,282,004 Taxes and liens receivable-prior years 1,060,261 - 1,060,261 � Taxes receivable-.current year 893,299 - 893,299 Deferred special assessments 30,130 88,700 118,830 Due from water district - 165,858 165,858 Loans 8,049,296 1,965,959 10,015,255 Internal balances 3,493,755 (3,493;755) - Inventories 754,990 118,185 873,175 Prepaid items _ 56,667 90,940 147,607 Other assets 1,282,784 2,082,261. 3,365,045 Non-depreciable capital assets 5,588,348 7,135,955 12,724,303 Depreciable capital assets,net 67,425,728 181,262,413 248,688,141 Total assets 114,306,101 216,953,786 331,259,887 LIABILITIES Accounts payable and other current liabilities 2,831,126 2,041,910 4;873,036 Accrued wages and benefits payable 4,347,373 244,457 4,591,830 Unearned revenues 4,680,523 53,215 4,733,738 Noncurrent liabilities I Due within one year 5,251,146 4,821,204 10,072,350 Due in more than one year 55,375,250 38,506,111 93,881,361 Total liabilities 72,485,4.18 45,666,897 1 T8,152,315 NET AS5ETS . Invested irr capital assets,net of related debt 49,447,154 154,066,934 203,514,088 Restricted for: Nonexpendable trust principal 656,658 - 656,658 Expendable income 399,223 - 399,223 � Penobscot River 6,472,901 - 6,472,901 Unrestricted (15,155,253) 17,219,955 2,064;702 i Total net assets $ 41,820,683 $ 171,286,889 $ 213,107,572 See accompanying notes to f nancial statements. � , , II - 16 � � i , Exhibit 2 CITY OF BANGOR,MAINE Statement of Activities For the Fiscal Year Ended June 30,2008 � � � � Net(e�cpeuse)revenue and changes � - � Pro�ram Revenues � in net assets � - Operafing Capital � Primary Government � Charges for grants and grants and Goverumeotal Business-type FuncHons/programs E�epenses services contribuHons contribuHons activities acNviNes Total , Priinary govemment� . " _ � � • Govemmental activities: General govemment $ 8,744,549 $ 2,282,374 $ 3,562 $ - $ (6,458,613 $ - $ ) (6,45$613) Pdblicsafery 14,945,855 2,439,831 218,024 994,245 (11,293,755) - (11,293,755) Health,communiry services and recreation 8,413,205 771,254 5,571,362 38,505 (2,032,084) - (2,032,084) Public services . 9,142,251 3,967,990 - 19,260 (5,155,001) - (5,155,001) - � Other agencies 4,829,547 22,243 200 - (4,807,104) - ` (4,807,104) Educatioe . 47,537,197 4,539,787 24,953,646 - (18,043,764) - (18,043,764) _ Arena Development 41,091 1,689,657 - - 1,648,566 , - 1,648,566 Communirydevelopment 2,156,241 297,394 1,723,735 _ (135,112) - (135,112) Streets/Sidewalks 1,359,002 , 159,351 - 832,330 (367,321) - (367,321)' Water&ont 1,754,281 - 7,625,000 210,930 6,081,649 - 6,081,649 PubGchansportation 2,118,374 809,531 1,274,989 23,880 (9,974) - (9,974) TaxincrementSnancing 1,066,192 - - - (1,066,192) - (1,066,192) 1' Intereston debt 3,206,764 (3,206,764) (3,206,764) ' Total govemmental activities 105,314,549 16,979,412 41,370,518 2,119,150 (44,845,469) (44,845,469) . � Business-type activities: � SewerUtility 6,052,419 6,745,ll2 - - - - 692,693 692,693 Airport 19,641,953 14,475,879 - 3,153,585 - (2,012,489) (2,012,489) Park Woods 678,867 340,494 - - - (335,373) (338,373) Parking 1,438,125 1,001,697 - - " - (436,428) (436,428) Bass Pazk 1,993,205 1,426,599 - - - (566,606) (566,606) MunicipalGolfCourse 695,969 655,834 - - (4Q135) (40,135) Economic Developmenf 695,851 422,716 273,147 12 12 Total business-type activities 31,196,389 25,065,331 3,426,732 ' (2,701,326) (2,701,326) Total primary govemment $ 136,510,938 $ 42,047,743 $ 41,370,518 S 5,545,882 (44,845,469) (2,701,32� (47,546,795) Generalrevenues: ' Property taxes,levied for general purposes 43,775,938 - 43,775,938 Paymentin lieu oftaces 122,510 - . 122,510 Excise taxes 4,641,320 - 4,641,320 Franchisetaxes 300,768 : 300,768 Grants and contributions not restricted to speciSc progams: Homestead exemption 646,925 - b46,925 - Other State aid 20,850 - 20,850 , State Revenue Sharing 4,852,999 - 4,852,999 Unrestricted investment eamings � ],274,939 1,326,787 2,601,726 Miscellaneousrevenues 161,439 - 161,439 . Transfers (539,088) 539,088 � Totalgeneralrevenuesand transfers 55,258,600 1,865,875 57,124,475 Change in net assets ]0,413,131 (835,451) 9,577,680 Net assets,beginning ofyeaz 31,407,552 172,122,340 203,529,892 Net assets,end ofyear $ 41,820,683 $ 171,286,889. $ 213,107,572 � � _ - � See accompanying notes to frnancral statemenls. � II-.17 Exhibit 3 CITY OF BANGOR,MAINE Balance Sheet Governmental Funds June 30,2008 Community Capital Other Total Development Racino Projects Governmental Governmental General Block Grant . Fund Fund Funds Funds ASSETS Assets Cash and cash equivalents $ 2,309,062 $ - $ - $ - $ 43_ $ 2,309,105� Investrnents 8,451,582 - 2,780,88] 6,785,519 . 346,678 18,364,660 Receivables: Taxes 1,953,560 - - - - 1,953,560 Accounts(net of allowance of$264,892) 833,323 - 16,021 90,979 1,025 941,348 Interfund 4,439,998 - 508,722 - 113,256 5,061,976 intergovernmental � 1,768,425 1,452,041 101,133 436,327 297,804 4,055,730 Loans 1,090,598 4,273,553 - - 2,685,145 8,049,296 Deferred special assessments � - - - 30,130 - 30,130 Inventory,at cost �54,990 - - - - 754,990 Investrnent of unexpended bond proceeds - - - 1,282,784 - 1,282,784 Prepaid items 56,667 - - - - 56,667 Total assets $ 21,658,205 $ 5,725,594 $ 3,406,757 $ 8,625,739 $ 3,443,951 $ 42,860,246 LIABILITIES AND FUND BALANCES ' Liabilities Accounts payable $ 1,241,244 $ 25;335 $ - $ 719,464 $ 76,295 $ 2,062,338 Accrued wages and benefits payable 4,347,373 - - - - 4,347,373 Interfund loans payable � - 1,276,148 - 123,229 168,844 1,568,221 Defened revenues 1,830,278 4,273,553 - - 328,459 6,432,290 Due to rehabilitation recipients - 254,932 - - - 254,932 Totalliabilities 7,418,895 5,829,968 - � 842,693 573,598 14,665,154 Fund balances • Reserved for: Encumbrances 929,953 , 1ll,734 - - 840,591 - 1,882,278 Prepaid items 56,667 � - - - - 56,667 Advances to other funds 1,650,500 - - - - 1,650,500 Penobscot River - - - 6,4'72,901 - 6,472,901 Nonexpendable Vust principal - - - - 656,658 656,658 Unreserved: Designated(Note J) 3,594,074 - - - - 3,594,074 Undesignated,reported in: General fund 8,008,116 - - - - 8,008,116 Special revenue funds - (216,108) 3,406,757 - 1,814,472 5,005,121 Capital projects funds - - - 469,554 - 469,554 Permanent funds - - � - - 399,223 399,223 Total fund balances(deficits) 14,239,310 (104,374) 3,406,757 7,783,046 2,870,353 28,195,092 Total liabilities and fund balances $ 21,658,205 $ 5,725,594 $ 3,406,757 $ 8,625,739 $ 3,443,951 Amounts reported for govemmental activities in the statement of net assets are different because: � Capital assets used in governmental activities aze not financial resources and,t6erefore,are not reported in the funds. 73,014,076 Deferred taxes are not available to pay for cunent-period expenditure and,therefore, are deferred in the funds. 1,751,767 Long-term liabilities,including bonds payable$56,998,022,accrued interest$513,856,compensated absences$2,036,534 and self insurance liability$1,591,840 aze not due and payable in the current period and,therefore,are not reported in the funds (61,140,252) Net assets of governmental funcL $ 41,820,683 See accomparrying noles to fittancial statements. \ � � ]I-18 � , , Exhibit 4 CITY OF BANGOR,MAINE Statement of Revenues,Expenditures and Changes in Fund Balances � Covernmental Funds For the Fiscal Year Ended June 3Q 1008 Community Capital Other Total � Development Racino Projects Governmental Govemmental General Block Grant � Fund Fund Funds Funds Revenues Taxes ' . $ 47,247,684 $ - $ - $ 245,896 $ 915,654 $ 48,409,234 ]ntergovemmental , 32,108,498 1,723,735 - 2,092,714 5,421,009 41,345,956 Licensesand permits 956,965 - - - - 956,965 Charges for services 12,372,417 - - - 910,858 13,283,275 Program income � - 271,863 - - 24,462 296,325 Revenue from use of money and propeity � 1,331,'I94 7,215 1,791,589 373,266 308,492 3,812,356 Other 24,361 220 - 7,651,436 15,446 7,69I,463 Totalrevenues 94,041,719 � 2,003,033 1,791,589 I0,363,312 7,595,921 115,795,574 Expendimres Current: Generalgovemment . 5,122,152 - - - 5,122,152 . Public safery 14,162,638 - - - 14,162,638 ,� Health,community services and recreation 4,305,709 - - - - 4,305,709 Public buildings and services 9,996,759 - - - - �9,906,759 Otheragencies 4,227,552 - - - - 4,227,552 Education 48,293,846 - - - - 48,293,846 Unclassified 146,679 20,315 - . - 166,994 Restrictedgrants - 1,996,091 - - 7,102,615 9,098,706 � Capital outlay 855,173 - - 7,183,069 - 8,038,242 Debt service 4,398,513 - - 82,334 - 4,480,847 - Total expenditures 91,419,021 1,996,091 20,315 7,265,403 7,102,615 107,803,445 Excess(deficiency)ofrevenues over(under)expenditures 2,622,698 •6,942 1,771,274 3,097,909 493,306 7,992,129 Other financing sources(uses) , Saleofassets 161,439 - - - - 161,439 Transfers to other funds (2,513,347) - (60,000) (33,178) (83,780) (2,69Q305) Transfers from otherfunds 164,374 - - 1,986,321 522 2,151,217 Total other financing sources(uses) (2,187,534) - (6Q000) 1,953,143 (83,258) (377,649) Changes in fund balances 435,164 6,942 1,711,274 S,OS1,052 410,048 7,614,480 Fund balances(�6cit),beginning ofyeaz 13,804,146 (1 I 1,316) 1,695,483 2,731,994 2,460,305 20,58Q612 Fund balances(deficit),end of ycar $ 14,239,310 $ (104,374) $ 3,406,757 $ 7,783,046 $ 2,870,353 $ 25,195,092 See accompanying notes ln f+nancial statements. i f i ll-19 , � Exhibit 5 CITY OF BANGOR,MAINE Reconciliation of the Statement of Revenues,Expenditures � and Changes in Fund Balances of Governmental Funds to the Statement of Activities � For the Fiscal 1'ear Ended June 30,2008 Net change in fund balances-total governmental funds(from E�chibit 4) $ 7,614,480 Amounts reported for governmental activities in the statement of activities(E�chibit 2)are different because: � Goyernmental funds report capital outlays as expenditures. . However,in the statement of activities,the cost of those assets is allocated over their estimated useful lives as depreciation expense. , This is the amount by which depreciation expense of$3,428,837 and disposals of$15,112 exceeded capital outlays of$2,603,691. (840,258) • Bond proceeds provide current financial resources to governmental funds,but issuing debt increases long-term liabilities in the statement of net assets. Repayment of bond principal is an expenditure in the governmental funds,but the repayment reduces long-term liabilities in the statement.of net assets. This is the amount of principal payments. 3,323,242 Some items reported in the statement of activities do not require the use of current financial resources and,therefore,are not reported as in governmental fund statements. The differences are as foliows: � increase in compensated absences($83,443),deferred taxes$324;867, decrease in accrued interest$14,313 and self insurance liability$59,930. 315,667 Change in net assets of governmental activities(see Exhibit 2) . $ 10,413,131 See accompanying notes to f nancial statements. � � II-20 Exhibit 6 CITY OF BANGOR,MAINE Statement of Revenues,Expenditures and Changes in � Fund Balaoce Budget.and Actual General Fund For the Fiscal Year Ended June 30,2008 Variance with . Final Budget � Budgeted amounts Positive Original Final Actual (Negative) Revenues Tvices $ 47,3]2,199 $ 47,312,199 $ 47,247;684 $ (64,515) Intergovemmental 26,586,691 26,622,462 27,799,974 1,177,512 Licenses and permits 537,550 537,550 956,965 419,415 � Charges for services ' municipal . 7,752,845 7,771,764 7,543,048 (228,716J school 3,909,687 3,909,687 4,539,787 630,100 Fines,forfeits and,penalties 27,550 27,550 24,361 (3,189) Revenue from use of money and property ' � municipal 780,446 780,446 855,255 74,809 Total revenues 86,906,968 86,961,658 88,967,074 2,005,416 Expenditures Current: General government 4,749,191 4,750,742 . 4,658,362 92,380 Public safety , ]4,550,26] 14,554,481 14,614,991 (60,510) Health,community services and recreation 4,124,972 4,139,972 4,306,393 (166,421) Public buildings and services 9,979,531 9,979,531 9,891,087 88,444 Other agencies 4,226,067 4,249,017 4,227,552 21,465 Education 45,122,614 47,413,665 44,895,256 2,518,409 . Debt service 4,404,214 4,404,214 4,144,273 259,941 Unclassified ' -155,210 155,210 400,919 (245,709) Total expenditures 87,312,060 89,646,832 87,138,833 2,507,999 Excess(deficiency)of revenues over/under expenditures (405,092) (2,685,174) 1,828,241 4,513,415 Other financing sources(uses) , � Appropriaton from designated fund balance 1,681,823 1,681,823 � 399,380 (1,282,443) Sale of assets 2,000 2;000 78,428 76,428 Contributions 15,000 15,000 15,000 - Insurance Settlements - - 6,642 6,642 Transfers to other funds (567,000) (615,919) (1,365,919) (750,000) Transfers from other funds 39,500 39,500 32,980 (6,520) . Operating transfers (751,231) (751,231) (751,231) - ' Total other financing sources(uses) 420,092 371,173 (],584,720) (1,955,893) Net change in fund balance $ 15,000 $ (2,314,001) 243,521 $ 2,557,522 Undesignated fund balance,beginning of year 8,259,260 Change in balances carried (494,665) Undesignated fund balance,end of year $ 8,008,116 See accompanying notes to financial statements. Il-21 � � � , I Exhibit 7 CITY OF BANGOR,MAINE Statement of Net Assets L Proprietary Funds June 30,2008 Business-type.Activities-Enterprise Funds . Sewer - . �Nonmajor Total � - Utility Airport Proprietary Proprietary Fund Fund Funds Funds • ASSETS � Current assets • Cash and cash equivalents $ 729 $ 249,945 $ 302,899 $ 553,573 Investrnents - 7,913,478 687,697 8,601,175 Accounts receivable 1,727,566 4,670,004 141,981 6,539,551 Less allowance for uncollectible accounts (22,601) (237,138) (27,110) (286,849) Net accounts receivable 1,704,965 4,432,866 114,871 6,252,702 , Due from other govemments . - 226,274 - - 226,274 Due from water district 165,858 - - 165,858 Inventories,at cost - 100,910 17,275 r 118,185 Prepaid items 33,990 27,851 29,099 90,940 � Total current assets 1,905,542 12,951,324 1;15,1,841 16,008,707 Noncurrent assets • Capital Assets: Land and improvements 683,865 - 5,113,724 5,797,589 Buildings and improvements 27,539,270 - 14,923,565 42,462,835 Machinery and equipment ' S,255,964 - 459,617 5,715,581 Infrastructure . 54,287,479 - 670,207 54,957,686 Aircraft operational assets � - 236,072,840 _ - 236,072,840 Pazking structures - - 9;968,268 9,968,268_ Construction in process 2,878,778 632,904 - 3,511,682 90,645,356 236,705,744 31,135,381 358,486,481 Less accumulated depreciation (31,902,640) (122,497,744) (15;687,729) (170,088,113) Net capital assets 58,742,716 114,208,000 15,447,652 188,398,368 Investments - ll,903,546 - 11,903,546 Loans receivable - 1,858,392 107,567 1,965,959 � Deferced special assessments 88,700 - - 88,700 Investment of unexpended bond proceeds 2,000,000 - - 2,000,000 Deposits - - 20,000 20,000 Bond issuance costs(net of accumulated amortization of$352,801) 62,261 - - 62,261 Total noncurrent assets. 60,893,677 127,969,938 15,575,219 204,438,834 , Total assets 62,799,219 140,921,262 16,727,060 220,447,541 . See accompanying notes to financial statements. Continued on next page II-22 , Exhibit 7(con't) CITY OF BANGOR,MAINE Statement of Net Assets Proprietary Funds June 30,2008 Business-type Activities-Enterprise Funds Sewer � Nonmajor Total Utility Airport Proprietary Proprietary Fund Fund Funds Funds LIABILITIES � � Cunent liabilities - Accounts payable � 192,172 1,393,902 120,212 1,706,286 Accrued wages and benefits payable 36,402 173,608 34,447 244,457 Accrued interest 186,997 57,628 87,007 331,632 Workers'compensation 38,962 131,475 9,805 18Q242 Unearned revenue - - 53,215 53,215 Accrued compensated absences 115,572 340,143 107,451 563,166 Interfundloans 725,000 - 2,768,755 3,493,755 � General obligation debt payable 2,774;948 532,607 791,471 4,099,026 Deferred amount on refundi�g (10,593) - (]0,637) (21,230) Other liabilities ' - 1,992 2,000 3,992 Total current liabilities 4,059,460 2,631,355 3,963,726 10,654,541 Long-term liabilities � Workers'compensation � 11,038 368,525 10,195 389,758 ' , General obligation debt payable 21,768,038 6,979,5 I5 8,875,966 37,623,519 Deferred amount on refunding (7,347) , - (10,333) (17,680)� Other long-term liabilities 298,269 - 212,245 510,514 Total long-term liabilities 22,069,998 7,348,040 9,088,073 38,506,111 Totalliabilities ,26,129,458 9,979,395 13,051,799 49,160,652 NET ASSETS � Invested in capital assets,net of related debt 37,190,897 110,383,000 6,493,037 154,066,934 � - Unrestricted (521,136) 20,558,867 (2,817,776) 17,219,955 Total net assets $ 36,669,761 $ 130,941,867 $ 3,675,261 $ 171,286,889 See accompanying notes to financial statements. � Continued from previous page I]-23 , Exhibit 8 , CITY OF BANGOR,MAINE � Statement of Revenues,Expenses and Changes in Net Assets Proprietary Funds . For the Fiscal Year Ended June 30,2008 � Business-type Activities-Enterprise Funds Sewer Nonmajor Total Utility Airport Proprietary Proprietary , Fund Fund Funds Funds Operating revenues Charges for services $ 6,740,788 $ 14,392,873 $ 3,847,340 $ 24,98I,001 � Operating expenses Operating expenses other than ti depreciation and amortization 3,578,491 12,027,118 4,039,850 19,645,459 Depreciation and amortization 1,689,332 7,225,830 968,022 9,883,184 Total operating expenses 5,267,823 19,252,948 5,007,872 29,528,643 Operating income(loss) 1,4'72,965 (4,860,075) (1,160,532) (4,547,642) � I Nonoperating revenue(expenses)' Interest income 52,551 1,199,663 74,573 1,326,787 Interestexpense (784,596) (389,005) (494,145) (1,667,746) Miscellaneous income(expense) 4,324 83,006 - 87,330 Total nonoperati�g revenue(expenses) (727,721) 893,664 (419,572) (253,629) Net income(loss)before grants/contributions and transfers 745,244 (3,966,411) (1,580,104) (4,801,271) Grants/contributions received for capital assets - 3,153,585 273,147 3,426,732 Transfers to oiher funds (100,000) - (147,143) (247,143) Transfers from other funds - - 786,231 786,231 Change in net assets ' 645,244 (812,826) (667,869) (835,451) Net assets,beginning ofyear 36,024,517 131,754,693 4,343,130 172,122,340 Net assets,end of year $ 36,669,761 $ 130,941,867 $ 3,675,261 $ 171,286,889 See accompanying notes to financial statements. I . } \ ��-24 , � �. • Exhibit 9 CITY OF BANGOR,MAINE Statement of Cash Flows-Proprietary Funds For the Fiscal Year Ended June 30,2008 _ Business-type Activities-Enterprise Funds Sewer Nonmajor Total Utility Airport Proprietary Proprietary Fund • Fund Funds Funds Cash flows from operating activities . Cash received from customers $ . 6,766,218 $ 16,306,108 $ 4,200,135 $ 27,272,461 Cash paid to suppliers for goods and services (2,467,636) (6,240,404) (2,693,527) (11,401,567) Cash paid to employees for services (1,362,163) (5,916,269) (1,444,718) (8,723,150) Net cash provided by(used in)operating activities 2,936,419 4,149,435 61,890 7,147,744 Cash flows from noncapital financing activities Interfund loans(repayments) 725,000 - 672,000 1,397,000 Transfersin - - 786,231 786,231 , Transfers out (]00,000) - (]47,143) (247,143) Net cash provided by(used in)noncapital financing activities 625,000 - 1,311,088 1,936,088 Cash flows from capital and related financing activities Proceeds from general obligation bonds 2,000,000 - - 2,000,000 Acquisition and construction of capital assets (2,176,910) (3,463,723) , (912,954) (6,553,587) Principal paid on.genera]obligation bonds (2,785,294) (515,906) (786,208) (4,087,408) Interest paid on general obligation bonds (797,481) (392,768) (487,511) (1,677,760) Proceeds from sale of property - 83,006 - 83,006 Grant monies received for capital assets - 694,690 273,147 967,837 Investment of unexpended bond proceeds (488,684) - 82,364 (406,320) Net cash provided by(used in)capital and related financingactivities (4,248,369) (3,594,701) (1,831,162) (9,674,232) Cash flows from investing activities • Net sales(purchases)of investments 553,860 (1,632,471) 143,044 (935,567) Interest on investments 60,250 1,199,663 77,031 1,336,944 Loan repayments - 35,732 6,178 41,910 Net cash provided by(used in)investing activities 614,110 (397,076) 226,253 443,287 Netincrease(decrease)in cash (72,840) 157,658 (231,931) (147,113) Cash,beginning ofyear 73,569 92,287 534,830 700,686 Cash,end of year $ 729 $ 249,945 $ 302,899 $ 553,573 Schedule of noncash investing,capita]and financing activities: During the year,the Airport Fund had an unrealized gain on investments in the amount of$178,844. � See accompanying notes to financial statements. Continued on next page 11-25 Exhibit 9(con't) CITY OF BANGOR,MAINE Statement of Cash Flows-Proprietary Funds For the Fiscal Year Ended June 30,2008 � Business-type Activities-Enterprise Funds Sewer Nonmajor Total Utility Airport Proprietary Proprietary Fund Fund Funds, Funds Reconciliation of operating income(loss)to net • cash provided by(used in)operating activities Operating'income(loss) $ 1,472,965 $ (4,860,075) $ (1,160,532) $ (4,547,642) � Adjustments to reconcile operating income(loss) , to net cash provided by(used in)operating; activities Depreciation and amortization 1,689,332 7,225,830 968,022 9,883,184 Provision for uncollectible accounts - 112,223 - ll 2,223 . Changes in assets and liabilities: - (Increase)decrease in accounts receivable (34,366) 1,913,235 380,980 2,259,849 (Increase)decrease in due from water district 59,796 - - 59,796 (Increase)decrease in inventories - (]0,134) (3,326) (13,460) (Increase)decreasein prepaid items 1,270 (49,073) 831 (46,972) Increase(decrease)in accounts payable (252,405) (251,509) (90,832) (594,746) Increase(decrease)in uneamed revenue - - ,'(28,185) (28,]85) Increase(decrease)in other current liabilities (173) 68,938 (5,068) 63,697 Total adjustments � 1,463,454 9,009,510 1,222,422 11,695,386 Net cash provided by(used in)operating activities $ 2,936,419 $ 4,149,435 $ 61,890 $ 7,147,744 See accompanying notes to frnancial stalements. � Continued from previous page II-26 Exhibit 10 � CITY OF BANGOR,MAINE St�tement of Fiduciary Net Assets � , Fiduciary Funds June 30,2008 • Agency Fund " ASSETS Cash and cash equivalents $ 159,225 Total assets $ 159,225 ; , LIABILITIES Liabilities: � Amounts held for others $ 159,225 Totalliabilities $ 159,225 See accompanying notes to financial statements. , ; II-27 � � This page left intentionally blank . � , , ' } � .. ' \ \ . ' i ` t INDEX OF NOTES TO THE FINANCIAL STATEMENTS Summary of Significant Accounting Policies . Note Paae A Reporting Entity � II — 28 '. B Government-wide and Fund Financial Statements II — 28 C Measurement Focus, Basis of Accounting and Basis of Presentation II — 29 D Assets, Liabilities and Equity II — 31 ' Stewardship, Compliance and Accountability . A Budgetary Information �-'� II — 33 B Reconciliation of Budgetary Basis Statements - II — 34 . C Excess of Expenditures Over Appropriations II — 35 D . Deficit Fund Equity \ II — 35 E Restricted Assets � `, II — 35 � Detailed Notes on All Funds f� • A Deposits and Investments ' ',II — 36 B Property 7ax ,� .. II — 37 - . C Capital Assets � � . II — 37 D InterFund Transactions � `�,`� ` � `� II— 39 � ��= l. .� , E Due From Other Governments �� . - _� -� �II —40 F Leases `, ,` .�� .�'' �f--: ' II —40 G Other Assets � ., � � f • / II — 41 H Deferred/Unearned Revenue '';` / II —41 I Long-Term Debt �`T'�r� � II— 41 7 Fund Balances `� `''�� II—45 K Net Assets II—47 . Other,Information - � A Risk Management II — 47 B Tax Increment Financing Districts II — 48 � C Contingent Liabilities II — 49 D Retirement . II — 49 E Landfill Closure and Postclosure Care Costs II — 51 F Subsequent Events II — 51 CITIf OF BANGOR, MAINE Notes to the Financial Statements � ]une 30, 2008 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES � A. Reporting Entity ' The City of Bangor was incorporated under the laws of the State of Maine in 1834 and operates under a council/manager.form of government. In evaluating how to define the reporting entity, for financial reporCing purposes, management has considered all potential component units. The criteria used to determine which entities, agencies, commissions, boards and authorities are part of the City's operations include how the budget is adopted, whether debt is secured by general obligation .of the City, the City's duty to co�er any deficits that may occur, and supervision over the accounting functions. Based upon all pertinent facts derived from the analysis of the above criteria, it was determined that no additional entities should be included as part of these financial statements. The City of Bangor is a 'member of the ]oint Venture of the Equity Charter Municipalities of Municipal Review Committee, Inc (Joint Venture). The Joint Venture is an organization that resulted�from a contractual arrangement between certain member municipalities, Penobscot Energy Recovery Company (PERC) and Bangor Hydro Electric Company. It was formed to pool resources of the Equity Charter Municipalities for the long-term goal of handling the disposal of their present and projected volumes of non-hazardous municipal solid waste. As of December 31, 2007 (most recent data available) the City of Bangor's share of the Joint Venture's net assets was $6,060,866. Compete financial statements may be obtained from Municipal Review Committee, 40.Harlow Street, Bangor, ME 04401. B. Government-wide and Fund Financial Statements - The government-wide financial statements (i.e., the statement of net assets and the statement of activities) report information on all of the nonfiduciary activities of the City. For the most part, the effect of interfund activity has been removed from these staternents. Governmental activities, which . normally are supported by taxes and intergovernmental revenues, are reported separately from business-type activities, which rely to a significant extent on fees and charges for support. The statement of activities demonstrates the degree to which the direct expenses of a given function or segments are offset by program revenues. Direct expenses are those that are clearly identifiable , with a specific function or segment. The City has elected not to allocate indirect costs among the programs, functions and segments. Program revenues include 1) charges to customers or applicants who purchase, u5e, or directly benefit from goods, services, or privileges provided by a given function or segment and 2) grants and contributions that are restricted to meeting the operational or capital requirements of a particular function or segment. Taxes and other items not properly included among program.revenues are reported as general revenues. � Separate financial�statements are provided for governmental funds, proprietary funds, and fiduciary funds, even though the latter are excluded from the government-wide financial statements. Major . individual governmental funds and major individual enterprise funds are reported as separate columns in the fund financial statements: � . � II-28 j . CITY OF BANGOR, MAINE Notes to the Financial Statements, Continued SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES, CONTINUED C. Measurement Focus, Basis of Accounting and Basis of Presentation The government-wide financial statements are reported using the economic resources.measurement focus and the accrual basis of accounting, as are the proprietary fund financial statements. 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 tlie year for which they are levied. � Grants and similar items are recognized as revenue as soon as all eligibility requirements imposed by the provider have been met. Governmental fund financial statements are reported using the current financial resources measurement focus and the modified accrual basis of accounting. Revenues are recognized as soon as they are both measurable and available. Revenues are considered to be available when they are collectible within the current period or soon enough thereafter to pay liabilities of the current period. For this purpose, the government considers revenues to be available if they are collected within 60 days of the end of the current fiscal period. Expenditures generally are recorded when a liability is incurred, as under accrual accounting. However, debt service expenditures, as well as certain compensated absences and claims and judgments, are recorded only when the payment is due. � � Those revenues susceptible to accrual are property taxes, interest, and charges for services. Other receipts and taxes become measurable and available when cash is received by the City and are recognized as revenue at that time. Entitlements and shared revenues are recorded at the time of receipt or earlier if the susceptible to accrual criteria are met. Expenditure-driven .grants are recognized as revenue when the qualifying expenditures have been incurred and all other grant requirements have been met. The City reports the following major governmental funds: The General Fund is the City's primary operating fund. It accounts for all financial resources of the general government, except those required to be accounted for in another fund. The Community Development Block Grant Fund accounts for federal grants obtained and expended under the Housing and Community Development Act of 1974, as amended, for the development of viable urban c,ommunities. , The Racino Fund accounts �for the percentage of slot revenues received by the Ciry from the operation of the Racino. .Said funds will be used to replace the Bangor Auditorium. The Capital Projects Fund accounts for the acquisition of capital assets or construction of major capital projects not being financed by proprietary or fiduciary funds. i . The City reports the following major proprietary funds: The Sewer Utility fund accounts for the costs of construction and operation of the sewage treatment plant, the City sewer system, and `sewer operation activities, and is self-supported through sewer user fees. � II-29 ' , � CITY OF BANGOR, MAINE . Notes to the Financial Statements, Continued SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES,CONTINUED The Airport Fund accounts for the operation of Bangor International Airport. The principal sources of revenues are landing fees and the sale of aviation fuel. Other revenue sources include lease payments for the use of terminal space and non-aviation industrial buildings. Additionally, the City reports the following fund type: Fiduciary funds account for assets held by the City in a trustee capacity or as an agent on behalf of others. The City's fiduciary funds include the following fund type: Agency funds are custodial in. nature and do not present results of operations or have a measurement focus. Agency funds are accounted for using the accrual basis of accounting. The funds are used to account for assets that the City holds for others in an agency capacity. Private-sector standards of accounting and financial reporting issued prior to December 1, 1989, generally are followed in both the government-wide and proprietary fund financial statements to the extent that those standards do not conflict with or contradict guidance of the Governmental Accounting Standards Board. Governments also have the option of foflowing subsequent private-sector guidance for their business-type activities and enterprise funds, subject to the same limitation. The City has elected not to follow subsequent private-sector guidance. As a general rule the efFect of interfund activity has been eliminated from the government-wide financial statements. Exceptions to this general rule are charges between the City,'s public services function and various other functions of the government. Elimination of these charges would distort the direct costs and program revenues reported for the various functions concerned. Amounts reported as program revenues include 1) charges to customers or applicants for goods, services, or privileges provided, 2) operating grants and contributions, and 3) capital grants and contributions, including special assessments. Internally dedicated resources are reported as general revenues rather than as program revenues. Likewise, general revenues include all taxes. . ,, Proprietary funds distinguish operating revenues and expenses from nonoperating items. Operating revenues and expenses generally result from providing services and producing and delivering goods in connection with a proprietary fund's principal ongoing operations. The principal operating revenues of the City's proprietary fund are charges to customers for sales and services. Operating expenses 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 nonoperating revenues and expenses. When both restricted and unrestricted resources are available for use, it is the City's policy to use restricted resources first; then unrestricted resources as they are needed. � ,II-30 - � CITY OF BANGOR, MAINE Notes to the Financial Statements, Continued SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES, CONTINUED D. Assets, Liabilities and Equity ' 1. Deposits and Investments Cash includes amounts in demand deposits as well as short=term investments with a maturity date within three months of the date acquired by the City. State statutes authorize the City to invest in obligations of the U. S. Treasury, commercial paper, corporate bonds and repurchase agreements. City policy prohibits the investment in so-called "derivative instruments". Investments are reported at,fair value. Income earned from the investment of pooled cash is allocated to various funds based upon the average cash balance allocated to the fund. 2. Interfund Rece�vables and Payables Activity between funds that are representative of lending/borrowing arrangements outstanding at the end of the fiscal year are referred to as either"interfund loans" (i.e. current portion of interFund loans) or "advances to/from other funds" (i.e. the non-current portion of interfund loans). Any residual ' balances outstanding between the governmental activities and business-type activities are reported in the government-wide financial statements as'�internal balances". Advances between funds are offset by a fund balance reserve account in applicable governmental funds to indicate tliat they are not available for appropriation and are not expendable available financial resources. � 3. Inventories and Prepaid Items � Inventories consist of expendable supplies held for consumption and are valued at cost. Under the consumption method, the costs of inventory items are recognized as expenditures/expenses when used. The consumption method does not require a reserve for inventory and the City has chosen not to have such a reserve. - Certain payments to vendors reflect costs applicable to future accounting periods and are recorded as prepaid items in both government-wide and fund financial statements. � II-31 , CITY OF BANGOR, MAINE Notes to the Financial Statements, Continued SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES, CONTINUED 4. Capital Assets ' Capital assets, which include property, plant, equipment, and infrastructure assets (e.g., roads, bridges, sidewalks, sewer mains,and similar ifems), are reported in the applicable governmental or business-type activities columns in the government-wide financial statements. Capital assets are defined by the City as assets with an initial, individual cost of more than $10,000 for machinery/equipment/vehicles, $25,000 for land/buildings and improvements and $100,000 for infrastructure and an estimated useful life in excess of one year. Such assets are recorded at historical cost or estimated historical cost if purchased or constructed. Donated capital assets are recorded at estimated fair market value at the date of donation. The costs of normal repairs and maintenance that do not add to the value of the asset or materially extend assets lives are not capitalized. Major outlays for capital assets and improvements are capitalized as projects are constructed. Interest incurred during the construction phase of capital assets of business-type activities is included as part of the capitalized value of the assets constructed. Properly, plant, and equipment of the primary government is.depreciated using the straight line method over the assets' estimated useful lives. � The range of useful lives used to compute depreciation are as follows: . Buildings 25 — 50 years Equipment 5 — 20 years Infrastructure 10 — 50 years Aircraft Operational 5 — 40 years Parking Structures 10 — 20 years 5. Compensated Absences Accumulated vacation or compensatory time or vested sick leave of governmental funds that is expected to be liquidated with expendable available resources is reported as an expenditure in respective fund financial statements only if the liability has matured, for example, as a result of employee resignations and retirements. All accumulated leave, including that which is not expected to be .liquidated with expendable. available financial resources, is reported in the government-wide financial statements. Accumulated leave of Enterprise Funds�is recorded as an expense and liability of the respective fund as the benefits accrue to employees. No liability is recorded for non-accumulating rights to receive sick pay benefits. � ' , � II-32 , CITY OF BANGOR, MAINE Notes to the Financial Statements, Continued SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES, CONTINUED 6. Long-term Obligations � In the government-wide financial statements,' and proprietary fund types in the fund .financial statements, long-term debt and other long-term obligations are reported as liabilities in the applicable governmental activities, business-type activities, or proprieta_ry fund type statement of net assets. Bond premiums and discounts, as well as issuance costs if material to basic financial statements, are deferred and amortized over the life of the bonds using the straight-line method. Bonds payable are reported net of the applicable bond premium or discount. Bond issuance costs are reported as deferred charges and amortized over the term of the related debt. � In the fund financial statements, governmental fund types recognize bond premiums and discounts, as - well as bond issuance costs, during the current period. The face amount of debt is reported as other financing sources. Premiums received on debt issuances are reported as other financing sources while discounts on debt issuances are reported as other financing uses. . Issuance costs, whether or not withheld from the actual debt proceeds received, are reported as debt service expenditures. 7. Fund Equity In the fund financial statements, governmental funds report reservations of fund balance for amounts . that are not available for appropriation or are legally restricted by outside parties for use for a specific purpose. Designated fund balances represent tentative plans for future use of financial resources. 8. Allowance for Uncollectible Accounts and Loans Allowances for uncollectible accounts are maintained for all types of receivables, which historically experience uncollectible accounts. Allowances for uncollectible loans are established when the City determines its abiliry to collect the outstanding loan balance has been impaired. 9. Use of Estimates Preparation of the City's financial statements requires management to make estimates and assumptions that affect the reported amounts of assets and�liabilities and disclosure of contingent items at the date of the financial statements and the reported amounts of revenues and expenses/expenditures during the reporting period. Actual results could difFer from those estimates. STEWARDSHIP, COMPLIANCE AND ACCOUNTABILITY � A. Budgetary Information Budgets are prepared on a modified accrual basis of accounting, with the exception of depreciation within the enterprise funds. Budgets for the General Fund and enterprise funds are formally adopted each year through the passage of an appropriation resolve. Budgets for special revenue and capital projects funds have adopted_project-length budgets. Unencumbered appropriations lapse at fiscal year end. II-33 � CITY OF BANGOR, MAINE Notes to the Financial Statements, Continued STEWARDSHIP, COMPLIANCE AND ACCOUNTABILITY, CONTINUED �Encumbrances represent commitments related to unperformed contracts for goods or services. Encumbrance accounting is employed in governmental funds. Encumbrances (i.e., purchase orders, contracts, and other commitments) outstanding at year end are reported as reservations of fund balances and do not constitute expenditures or liabilities because the commitments have not be honored in the current year. For budgetary purposes, encumbrances are treated� as expenditures � within both governmental and proprietary fund types. � � On or before the second Monday in April, the City Manager submits to the City Council a proposed operating budget for the ensuing fiscal year. The Council ,holds public meetings and a final budget must be prepared and adopted no later than June 30th. Should the Council fail to adopt an operating budget on or before ]une 30th, by Charter, the budget proposed by the City Manager becomes effective. r � The budget is adopted at the department level through the passage of appropriatior� resolves. The ' City Manager may make transfers of appropriations within a department. Transfers between departments or additional appropriations require the approval of the City Council. The City Council ' rnade several supplementary budgetary appropriations throughout the year, none were material: , B. Reconciliation of Budgetary Basis Statements , The following schedule reconciles the :General Fund .amounts on the Statement of Revenues, Expenditures, and Changes in Fund Balance—Budget and Actual—Budgetary Basis to the amounts on the Statement of Revenues, Expenditures, and Changes in Fund Balances, Governmental Funds: � ' Excess of revenues over expenditures and other financing sources and uses(Budget) $243,521 Activity in designated fund balance 163,339 2008 encumbrances 915,554 2007 encumbrances lapsed (11,779) 2007 encumbrances paid (875,471) Excess of revenues and other financing sources over expenditures and other uses(GAAP) � 435.164 The following schedule reconciles the amounts on the enterprise funds' Schedules of Revenues, Expenditures and Encumbrances—Budget and Actual—Budgetary Basis to the amount on the Combined Statement of Revenues, Expenses, and Changes in Net Assets: II-34 l CITY OF BANGOR, MAINE , Notes to the Financial Statements, Continued STEWARDSHIP, COMPLIANCE AND ACCOUNTABILITY, CONTINUED Excess(deficiency)of revenues over expenditures and encumbrances: Sewer , $ (2,113,289) Airport ' (4,277,215) Park Woods (154;116) Parking (455,082) � Bass Park (223,723) Municipal Golf Course (294,483) � � - Economic Development • (12,714� . (7,530,622) " Nonoperating revenues classification (1,493,568) Investments at market value (369,640) Capital outlay 124,395 Capital projects . (808,981) Adjustments for.accrual basis (425,658) ; Principal payments 4,087,408 2008 encumbrances 18,357 2007 encumbrances (34,662) Nono,perating expenses classification 1,885,329 Operating loss $ 4"547•64 ) C: Excess of Expenditures Over Appropriations The following General Fund departments were over-expended by the indicated dollar amounts; Assessing $993, Legal $2,550, Fire $245,587, Health and Community Services $157,512, Parks and Recreation $8,909, Other Agencies $13,985, and Tax Increment Financing Payments $10,450. These � over-expenditures were funded by receipt of revenues in excess of appropriation and under- expenditures within other General Fund departments. , , The Airport Fund was over-expended by $473,762, due to underestimated depreciation expense. The Parking Fund was over-expended by $5,706, which was funded by receipt of revenues in excess of appropriations. The Golf course �was .over-expended by $223,746, which , is attributable to unanticipated capital acquisitions and transfers to the General Fund. The Park Woods and Bass Park Funds were over-expended by $32,627 and $10,332 respectively, but were reasonable based upon the expected deficiencies within each fund. ' D. Deficit Fund Equity The Bass Park Enterprise Fund has a deficit fund equity of $1,652,337. The �City Council has determined that the facility will either be closed or replaced in the near future. With continued review of parking usage and fees it is anticipated that the Parking.Fund deficit of $430,708 will at the least stabilize over the coming years. It is anticipated that program income in subsequent years will fund the $104,374 deficit in the Community Development Block Grant Fund. E. Restricted Assets � Donations received by the City whose use is limited are placed in fhe appropriate Special Revenue fund, depending upon whether or not the principal can be expended. All changes in market value are added to the earnings, which is allowable by State Statute. As these amounts are invested in a note receivable, there was no change in market value for fiscal year 2008. II-35 � � � CITY OF BANGOR, MAINE Notes to the Financial Statements, Continued DETAILED NOTES ON ALL FUNDS A. Deposits and Investments The City maintains a cash pool that is available for use by all funds. In addition, cash and investments are separately held by several of the funds. , Custodial Credit Risk - Deposits - Custodial credit risk is the risk that in the event of a bank failure, the City's deposits may not be returned. The City does not have a policy with respect to custodial credit risk for deposit accounts. The City does maintain insurance coverage to protect up to $7,000,000 of deposits in addition to the $100,000 provided by the Federal Deposit Insurance Corporation (FDIC). As of June 30, 2008, $0 of the City's bank balance of$3,161,056 was exposed to custodial credit risk because it was uninsured and uncollateralized. At June 30, 2008, the City had the following investments and maturies: ' Maturity(years) Investment types Fair Value Not Applicable <1 1-5 6-10 - Mutual Funds $21,164,651 $ 21,164,651 $ - $ - $ - US Treasuries 14,752,199 - 3,412,386 5,702,933 5,636,880 . Common stock 1,455,567 1,455,567 - - - Certificate of Deposit 2,779,748 - __1,703,017 1.026,731 - Totals 40.152.165 $22 620 218 5.115.403 �6.729.664 $ 5.636.880 Interest Rate Risk � The City's Investment Policy requires that, to the extent possible, the City will attempt to match investments with anticipated.cash requirements. Unless matched to a specific cash flow, the City is not allowed to directly invest in securities maturing more than three years from the date of purchase. Credit Risk Credit risk is the risk that an issuer or other counterparty to an investment will not fulfill its obligations. Maine statutes authorize the�City to invest in obligations of the U:S. Treasury and U.S agencies, repurchase agreements and certain corporate stocks and bonds. In accordance with City policy, investments in certificates of deposits must be F.D.I.C. insured and any excess of the amounts covered by insurance must be collateralized in accordance with Title 30-A, Section 5706 of the Maine Revised Statutes; investments in mutual funds must be "no load" (which means no commission or fee shall be char.ged on the purchase or sale), have a constant daily net asset value of$1.00 per share and limit assets of.the fund to U.S. Treasury Obligations or Federal Instrumentality or Agency Securities; the total investments in stock can not exceed 10% of the portfolio value and no more than 5% can be invested in any one company. Custodial Credit Risk - Investments For investments, custodial credit risk is the risk that, in the event of failure of the counterparty, the City will not be able to recover the value of its investments or collateral securities that are in the possession of the outside party. As of June 30, 2008, the City had no investments that were subject to custodial risk. The City's investment policy states that all security transactions, including collateral for repurchase agreements, entered into by the City shall be conducted on a "delivery vs. payment" basis. Securities will be held by a third party custodian, or Trust Department, designated by the Treasurer and evidenced b,y safekeeping receipts. II-36 � � CITY OF BANGOR, MAINE Notes to.the Financial Statements, Continued DETAILED NOTES ON ALL FUNDS, CONTINUED Concentration of Credit Risk The City's Investment Policy states that the City will diversify its investments by security type and - institution. No more than 40% of the City's total investment portfolio will be invested in any combination of commercial paper and time certificates of deposit. B. Property Tax Property taxes for the current year were levied July 6, 2007, on the assessed value listed as of the prior April 1'for all real and personal property located in the City. Assessed values are periodically established by the City's Assessor at 100% of assumed market value. Taxes were due in two installments: September 17, 2007 and March 17, 2008. Interest was charged at 12.00% on all taxes unpaid as of the due date. Properry taxes levied during the year were recorded as receivables at the tirne the levy was made. The receivables collected during the year and in the first sixty days following the end of the fiscal year have been recorded as revenues. The remaining receivables have been recorded as deferred revenues. Tax liens are placed on real property within twelve months following the tax commitment date if taxes are delinquent. The City has the authority to foreclose on property eighteen months after . the filing of the lien if the tax liens and associated costs remain unpaid. C. Capital Assets � Capital asset activity for the year ended June 30, 2008 was as follows: - Balance Balance June 30, June 30, 2007 Increases Decreases 2008 Governmental activities: Capital assets, not being depreciated: Land $ 5,040,548 - - 5,040,548 Construction in proQress 12,432,075 1,645,639 13,529,914 547,800 . Total capital assets, not being depreciated 17,472,623 1,645,639 13,529,914 5.588,348 Capital assets, being depreciated: , • Land improvements 5,997,377 767,792 - 6,765,169 Buildings and improvements 49,992,448 10,126,554 - 60,119,002 � Machinery and equipment 8,336,561 1,636,534 - 9,973,095 � Vehicles 12,032,900 1,117,133 475,171 12,674,862 Infrastructure 19.651,692 840,250 - 20,491,942 Total capital assets being depreciated 96,010,978 14,488,263 475,171 110,024,070 Less accumulated depreciation for: Land improvements (1,659,043) (282,591) - (1,941,634) Buildings and improvements (18,217,444) (1,067,735) - (19,285,179) Machinery and equipment (4,924,981) (771,999) - (5,696,980) Vehicles (6,284,304) (869,408) (460,059) (6,693,653) Infrastructure (8 543,792) (437�104) - (8 980,896� Total accumulated depreciation (39,629,564) (3,428,837) (460,059) (42,598,342) Total capital assets being depreciated, net 56,381,414 11.059.426 15.112 67,425.728 overnment?I activities canital assets,net �73.854.037 12.705.065 13.545.026 73.014.076 II-37 CITY OF BANGOR, MAINE Notes to the Financial Statements, Continued D�TAILED NOTES ON ALL FUNDS, CONTINUED Balance Balance June 30, June 30, . 2007 Increases Decreases 2008 Business-type activities: Capital assets, not being depreciated: Land $ 3,530,811 93,462 - 3,624,273 Construction in proaress 4,714,261 6,370,115 7,572,694 3,511,682 Total capital assets, not bein4 depreciated 8,245.072 6.463'.577 7,572,694 7,135,955 Business-type activities: Capital assets, being depreciated: � � Land improvements 2,103,086 70,230 - � �2,173,316 ' Buildings and improvements 41,170,739 1,362,326 70,230 42,462,835 Machinery and.equipment � 5,671,113 109,911 65,443, 5,715,581 Infrastrudure 54,147,784 809,902 - 54,957,686 Airport operational assets 230,625,633 5,447,207 - 236,072,840 Parking structures 9,968,268 - - 9.968.268 Total capital assets being depreciated 343,686,623 7,799,576 135,673 351,350,526 Less accumulated depreciation for: � Land improvements (1,033,885) (86,415) - (1,120,300) Buildings and improvements (24,810,300) (1,273,315) - (26,083,615) Machinery and equipment (3,738,770) (249,613) (65,443) (3,922,940) Infrastructure (8,861,547) (548,878) - (9,410,425) Airport operational assets (115,271,913) (7,225,831) - (122,497,744) Parkin4 structures (6,574,709) (478.380) - (7,053,089� � Total accumulated depreciation (160,291,124) (9,862,432) (65,443) (170,088,113) Total capital assets beina depreciated, net 183,395,499 f2,062.856) � 70,230 181.262,413 usiness-tvne activities caoital assets,net $191.640.571 4.400.721 7.642.924 188.398.368 Depreciation expense was charged to functions/programs of the primary government as follows: Governmentel activities: • General government $ 1,220,816 Public safety 586,724 Health,community services and recreation 173,436 Public building,and services 576,343 1 Education 871.518 deoreciation exnense—aovernmental activities �3.428.837 Business-type activities: , Sewer Utility Fund $1,668,580 Airport Fund 7,225,830 Park Woods 89,123 Parking Fund . 478,381 Bass Park Fund 67,964 Municipal Golf Course 107,596 Economic Develo�ment Fund 224,958 Iotal_deureciation exoense—business-tvoe activities �9.862.432 II-38 � CITY OF BANGOR, MAINE ' Notes to the Fina'ncial Statements, Continued DETAILED NOTES ON ALL FUNDS, CONTINUED Construction commitments , The government has active construction projects as of June 30, 2008. The projects include , reconstruction of runways, construction of additional infrastructure on the waterfront, and continuation of the combined sewer overtlow program. D. Interfund Transactions Individual fund interfund receivable and payable transactions are described in the Sumr�ary of Significant Accounting Policies Note D. 2. As of June 30, 2008 the balances were as follows: Receivable Pavable General Fund $4,439,998 $ - , Racino Fund 508,722 - Community Development Block Grant -� 1,276,148 Capital Fund - 123,229 Other Governmental Funds 113,256 168,844 Sewer -. 725,000 Park Woods Fund - 266,000 Bass Park Fund - 1,843,255 Economic Development � - 659.500 , $ 5.061.976 $ 5.061.976 Individual fund transfers to and from other� funds for the fiscal year ended June 30, 2008 are comprised primarily of transfers from fund balances to fund capital projects and to provide operating subsidies to certain proprietary funds. Transfers to Transfer from General Fund $2,513,347 $ 164,374 Racino Fund 60,000 - Special Revenue Funds 72,980 - Capital Projects Fund 33,178 1,986,321 Proprietary Funds 247,143 786,231 PermanentFunds 10,800 522 �2.937.448 $ 2.937.448 � ' . II-39 CITY OF BANGOR, MAINE Notes to the Financial Statements, Continued DETAILED NOTES ON ALL FUNDS, CONTINUED , E. Due From Other Governments � Due from other governments is comprised of the following amounts at)une 30, 2008: Federal State of ' Government Maine. Other Total General Fund $ 52,424 $ 1,197,420 $ 518,581 $ 1,768,425 Special Revenue Funds 1,734,428 15,417 - 1,749,845 Racino Fund - 101,133 - 101,133 Capital Projects Fund 157,599 278,728 - 436,327 Proprietary Funds 226,274 - - 226,274 Of the General Fund's $1,197,420 due from State of Maine, $241,433 represents school grant and State agency billings, $700,438 is due from the Department of Transportation and $206,986 represents general assistance claims. Amounts due from other communities for tuition reimbursement to Bangor accounts for $349,,413 of the Due from Other in the General Fund. � , F. Leases Operating Leases ` The Airport and Economic Development Proprietary Funds are the lessors of various buildings and land parcels under operating leases expiring in various years through 2039 and 2033, respectively. Minimum future rentals to be received on noncancelable leases as of June 30, 2008 are: Fiscal year ending Economic � June 30, Airport Development 2009 $ 1,439,864 $ 412,035 ` 2010 1,127,080 380,959 2011 882,714 , 381,951 2012 820,260 382,972 2013 724,780' 362,360 Subsequent to 2013 3,872,397 1,846,411 , 8,867,095 $ 3.766.688 Minimum future rentals do not include contingent rentals, which may be received as stiPulated in the lease contracts. The Airport received $1,451,090 in contingent rentals in fiscal year 2008. The carrying amounts of the leased assets are as follows: Economic Airport Development Land $ 565,901 $ 2,395,046 Buildings 22,598,729 6,490,170 Less accumulated depreciation (9,404,671) (992,856� Total 13,759,959 $ 7.892,360 II-40 , CITY OF BANGOR, MAINE Notes to the Financial Statements, Continued DETAILED NOTES ON ALL FUNDS, CONTINUED G. Other Assets Other assets are comprised of the following: Capital Proprietary Projects Fund Fund Investment of bond proceeds $ 1,282,784 $ 2,000,000 Deposits - 20,000 � Bond issuance costs (net of amortization) - 62,261 Total 1.282,784 $ 2.082.261 H. Deferred/Unearned Revenue � � General Fund deferred revenue consists of $1,751,767 in deferred taxes and $78,511 of advance deposits. Community Development Block Grant and Other Governmental Funds deferred revenue of $4,273,553 and $328,459, respectively, represents future revenue equal to loans made pursuant to the Comrnunity Development, Urban Development Action Grants and Economic Incentive Revolving Loan Fund. Under the terms of these grants, loans made are recognized as an expenditure in the Special Revenue Fund when they occur. Further, in accordance with regulations governing such funds, the repayments of such loans are considered program income as received and are available to the recipient . for additional use within the program. Proprietary Funds unearned revenue of $53,215 represents � advance deposits. � � I. Long-Term Debt � General Obligation Bonds � The City issues gener.al obligation bonds to provide funds for the acquisition and construction of major capital additions. General obligation bonds have been issued for both governmental and business-type activities. These bonds are reported in the proprietary funds if they are expected to be repaid from proprietary fund revenues. In addition, general obligation bonds have been issued to refund general obligation bonds and extinguish an existing r.etirement liability. General obligation bonds are direct obligations and pledge the full faith and credit of the government. These bonds generally are issued as 20-year serial bonds. The original amount of general obligation bonds issued is $144,688,548. The following is a summary of general obligation bond and note transactions of the City for the fiscal year ended June 30, 2008: Bonds and notes payable at June 30, 2007 $ 104,131,217 Add: principal additions 2,000,000 � Less: principal repayments 7,410,650 Bonds and notes payable at June 30, 2008 98.720.567 ` II-41 " CITY OF BANGOR, MAINE Notes to the Financial Statements, Continued DETAILED NOTES ON ALL FUNDS, CONTINUED Bonds and notes payable at]une 30, 2008 are comprised of the following: Fiscal year Interest Governmental activities Business-type . Total of maturitv rate City School activities ]une 30.2008 Long-term debt: Treatment Plant 2011 7.00%-7.10% $ - $ - $4,750,000$ 4,750,000 Combined sewer overFlow 2014 2.46% - - 559,200 559,200 Combined sewer overFlow 2014 2.45% - - . 595,800 595,800 Combined sewer overflow 2017 3.52% - - � 1,521,383 1,521,383 Tax increment financing note* 2016 6.00%-6.90% 605,000 - - 605,000 Combined sewer overflow 2018 3.03% - - 1,362,084 1,362,084 Public improvements—1997 2018 4.875%-5.3% 2,032,340 2,155,000 1,037,660 5,225,000 Tax increment financing note* 2018 6.19% 195,000 - - 195,000 Public improvement—1999 2019 3.8%-4.6% 877,500 - 832,500 1,710,000 Maine Business Enter Park 2018 5.00% - - 161,005 161,005 Public improvements—2000 2020 5.25%-5.90% 951,076 - 1,083,924 2,035,000 Public improvements—2001 2021 4.25%-5.00% 846,000 104,000 3,020,000 3,970,000 � State Revolving Renovation—School 2011 0.00% - 170,580 - 170,580 Public improvements note* 2012 6.25% 569,907 - - 569,907 Public improvements—2002 2022 3.50%-4.75% 3,155,000 3,150,000 1,315,000 7,620,000 Pension obligation bonds � 2026 3.06%-6.45% 25,296,321 1,607,568 5,391,111 32,295,000 Refunding bonds 2024 3.06%-3.47% 499,079 1,715,201 3,240,720 5,455,000 Combined sewer overFlow 2023 1.94% - - 2,324,029 2,324,029 Public improvements note* 2012 2.50%-4.00% - - 137,952 137,952 Tax increment financing note* 2015 2.50%-4.00% 113,410 - - 113,410 Briggs Building note 2023 6.50% - - 1,090,598 1,090,598 Refunding/public improvements-2004 2023 2.50%-4.80% 3,025,550 543;600 1,615,850 5,185,000 Combined sewer overflow 2024 1.41% - - 2,314,418 2,314,418 Public improvements-2005 2024 3.50%-4.30% 2,185,000 - 850,000 3,035,000 Airport building sprinklers 2024 3.25%-5.00%� - - 1,955,000 1,955,000 Chancellor's property note 2025 5.00% - - 2,110,506 2,110,506 Public improvements/refunding 2025 4.00%-4.20% 3,845,890 - 539,110 4,385,000 Combined sewer overflow 2027 1.64% - - 1,914,695 1,914,695 Public improvements—2007 2027 4.00% 3,355,000 - - 3,355,000 Combined sewer overflow 2028 1.81% 2,000,000 2,000,000 Total bonds and notes payable 47.552.073 �9.445.949 �41.722.545 �98.720.567 * Five series of general obligation notes aggregating$1,621,269 are held by the City's Airport Fund at fixed,taxable market rates of interest. These notes are structured with a put feature,which,upon certain precedent conditions,allows the Airport to present them for redemption to the City's General Fund. It is management's intention,should a put occur,to fund it by passing the note along to its Sewer Fund,where it will be converted to a three to five year fixed note with level debt service,albeit without a put option. Annual debt service requirements to maturity for general obligation bonds and notes payable are as � follows: . Fiscal year ending Governmental Activities Business-Type Activities June 30, Principal Interest Princi al Interest 2009 $ 3,410,336.$ 2,996,255 $ 4,099,026 $ 1,529,659 2010 3,338,237 2,856,197 4,101,195 1,386,725 2011 3,171,863 2,720,186 3,854,382 1,282,166 ' 2012 3,628,863 2,582,828 3,600,955 1,145,903 2013 3,224,642 2,408,328 3,600,264 1,017,290 . 2014-2018 15,729,185 9,707,024 10,196,341 3,825,022 2019-2023 14,533,666 5,595,828 8,274,019 1,893,284 2024-2028 9,961,230 1,238,447 3,996,363 352,888 Total 56.998,022 $�30,105,093$ 41J22,545 � 12.432.937 II-42 � , CITY OF BANGOR, MAINE Notes to the Financial Statements, Continued l � DETAILED NOTES ON ALL FUNDS, CONTINUED �� The City is subject to the laws of the State of Maine, which limits the amount of long-term debt to 15% of the state's assessed valuation of the City. At ]une 30, 2008, the statutory limit for the City was $353,737,500. The City's outstanding long-term debt of $98,720,567 at June 30, 2008 was within the , statutory limit. �, Advance and Current Refunding ' In prior years, the City defeased certain general obligation bonds which reduced 'total future deb.t � service payments in governmental and business-type funds by $408,000 and $302,000, respectively. This transaction placed the proceeds of the new bonds in an irrevocable trust to provide for all future , debt service payments on the old bonds. The trust account assets and the liability for the defeased. bonds are not included in the City's financial statements. At ]une 30, 2008, $657,400 and $1,697,600 of the governmental and business-type activities, respectively, are considered defeased. Within the Proprietary Funds the advance refunding transaction gave rise to a deferred amount on refunding. The ' �deferred amount on refunding is being amortized over the remaining life of tlie original bonds. ` Authorized and Unissued � On September 26, 2005, the City Council authorized the issuance of up to $6,868,831 in general t obligations bonds for various purposes. As of June 30,. 2008, $1,500,000 remains authorized and unissued for the construction, demolition, engineering and furnishing of Fire Station 6. On March 27, 2006, the City Council authorized the issuance of up to $455,000 in general obligation bonds for the purpose of renovating and rehabilitating property located at 103 Texas Avenue. As of June 30, 2008, $255,000 remains authorized and unissued. The City expects to issue the debt within the next fiscal year. On August 27, 2007, the City Council authorized the issuance of up to $770,122 in general obligation bonds for the purpose of funding the City's annual fleet replacement. As of]une 30, 2008, $770,122 remains authorized and unissued. The City expects to issue the debt within the next fiscal year. � On November 26, 2007, the City Council authorized the issuance of up to $600,000 in general , obligation bonds for the purpose of renovating and rehabilitating property located at 103 Texas Avenue. As�of June 30, 2008, $600,000 remains authorized and unissued. The City expects to issue the debt within the next fiscal year. , II-43 CITY OF BANGOR, MAINE , Notes to the Financial Statements, Continued " DETAILED NOTES ON ALL FUNDS, CONTINUED - Overlapping Debt , � In addition to the bonds and notes payable, the City may be contingently responsible for a proportionate share of overlapping debt. Overlapping debt is debt issued by a separate entity that . shares the same tax base as the City of Bangor. As of June 30, 2008 the City did not have any overlapping debt obligations. - Changes in Long-term Liabilities Long-term liability activity for the year ended June 30, 2008, was as follows: Balance Balance Due within June 30, 2007 Additions Redudions June 30, 2008 one year Governmental activities: " General obligation debt $60,321,264 - 3,323,242 56,998,022 3,410,336 Accrued compensated absences* 1,953,091 1,545,154 1,461,711 2,036,534 1,232,920 Lon4-term obliQation for self insurance 1,651,770 587,251 ' 647,181 1.591,840 607,890 Governmental activities ' lona-term liabilities $63.926.125 2.132.4�5 5.432.134 60.626.396 5.251.146 � Business type activities: ' General obligation debt 43,809,953 2,000,000 4,087,408 41,722,545 4,099,026 Accrued compensated absences 542,593 417,010 396,437, 563,166 563,166 . Long-term obligation for self insurance 470,000 202,525 102,525 570,000 180,242 Deferred amount on refunding (68,470) - (29,560) (38,910) (21,230) Other 504;682 5.832 - 510,514 - Business type activities lona-term liabilities $45.258.758 2.625.367 4.556.810 43.327.315 4.8 �. 04 *-The liquidation of compensated absences is fully covered within the General Fund II-44 , CITY OF BANGOR, MAINE Notes to the Financial Statements, Continued . ` DETAILED NOTES ON ALL.FUNDS, CONTINUED ]. Fund Balances Perrnanent Funds � As of]une 30, 2008, the fund balances by purpose were as follows: , � Restricted Unrestricted , , Nonexpendable Permanent , '� Trust Principal Funds - Cemetery , $ 373,495 $ 31,567 � Parks 14,538 45,203 City Missionary 16,511 58,726 ' Education 44,138 66,614 Aid for Aged Women 43,067 75,374 ' Other Purposes 30,860 121,739 � Total nonmajor permanent funds 522.609 $ 399,223 Dedicated Revenue Funds - Special Revenue Funds � As of June 30, 2008, the fund balances by purpose were as follows: Dental Clinic . $ 35,335 � Preservation of Records 141 Adopt a Park 107,008 ' Park Woods Children ' 153 City Forest 222,407 ' BFD Imaging 6,811 Park Woods Complex 207,816 USS Maine Monument 14,411 Flower 1,040 Impact Fees 153,264 Kenduskeag Stream Trail 5, Skate Park � 950 Tricentennial 1,217 Total dedicated revenue funds 750 588 , ' II-45 � CITY OF BANGOR, MAINE Notes to the Financial Statements, Continued � DETAILED NOTES ON ALL FUNDS, CONTINUED - Designated Fund Balance � Designated fund balance of the General Fund at June 30, 2008 consists of amounts, which the City intends to use for the following purposes: . Departmental balances carried forward $ 35 450 � School department— regular 2,145,842 adult education � 182,480 reading assessment 21,183 special revenue 180,800 school lunch 96,571 , trust and agency 146,340 Total balances carried 2,808,666 Accrued summer teacher payroll (2,730,347) Pooled equipment , 57,841 � Bus equipment 97,880 Fire equipment � 188,421 Improvement � 313,594 � Self insurance 1,591,840 Cameron stadium 343,051 ' Landfill closure � 10,523 Cascade park maintenance 47;623 � Demolition 1,489 PEG capital support 118,450 Pickering Square development district 90,513 Parks & Rec Improvement (89,919) Benefit reserve 391,830 � Pension obligation bond savings 96,861 Arbitrage rebate 255,758 3.594,074 II-46 CITY OF BANGOR, MAINE Notes to the Financial Statements, Continued � DETAILED NOTES ON ALL FUNDS, CONTINUED K. Net Assets , Net assets represent the difference between assets and liabilities. Nef assets invested in capital assets, � net of related debt consists of capital assets, net of accumulated depreciation, reduced by the � outstanding balance of ibonds and capital leases payable and adding back any unspent proceeds. Net assets are reported as restricted when there are limitation imposed on their use�either through the , enabling legislations adopted by the City of through external restrictions imposed by creditors, grantors or laws or regulations of other governments. The City's net assets invested in capital assets, net of � related debt was calculated as follows at June 30, 2008: � � Governmental Business-Tvpe Capital assets $115,612,418 $358,486,481 , Accumulated depreciation (42,598,342) (170,088,113) Bonds payable (24,849,706) (36,331,434) Unspent bond proceeds 1,282,784 2,000,000 Total invested in capital assets net of , related debt 49.447.154 $154.066,934 OTHER INFORMATION A. Risk Management , � . The City 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 for which the City either carries commercial insurance or is self—insured. The City currently reports all of its risk management activities in the General and Proprietary Funds. Claims expenditure, liabilities and reserves are reported when �it is probable that a loss has occurred and the amount of the loss can be reasonably estimated. These losses include an estimate of claims that have been incurred but not reported. The City purchases coverage under a number of commercially available insurance policies such as; commercial general liability, auto, property damage and crime and dishonesty, each with limits and deductibles deemed prudent given the risks, cost of coverage and the City's ability to fund certain types of losses. For those claims covered by commercial insurance, the amount of settlements has not exceeded the coverage for the years ended June 30, 2008, 2007 and 2006. II-47 � CITY OF BANGOR, MAINE Notes to the Financial Statements, Continued � . � OTHER INFORMATION, CONTINUED - The City is self-insured for its warkers' compensation liability. Reserves are actuarially determined each year to assure funding adequacy. In addition, the City purchases excess workers' compensation insurance to limit its financial risk. At June 30, 2008, the amount of self-insurance liabilities was $2,161,840. This liability is the City's best estimate based on available information. Changes in the reported liabilities since ]uly 1, 2006 resulted from the following: Workers' All other self- Comqensation insured risks Total. Unpaid claims as of July 1, 2006 $ 1,901,953 $ 214,364 $ 2,116,317 Incurred claims 925,097 - 925,097 Payments (643,815) (4,800) (648,615) Changes in estimates and other adjustments (282,915) 11,586 (271,329�, Unpaid claims as of]uly 1, 2007 1,900,320 221,150 2,121,470 Incurred claims 266,179 - 266,179 . Payments (749,706) - (749,706) Changes in estimates and other adjustments 513,414 10,483 523,897 . Unpaid claims as of June 30, 2008 1.930.207 $ 231.633 $ 2.161.840 B. Tax Increment Financing Districts The City has established tax increment financing districts, all of which dedicate a portion of the incremental increase in real estate and/or personal property tax revenues over staggered twenty year periods for the following purposes: B.I.A. Municipal Develo�ment District No. 1 - Partially financed $27.5 million dollars of capital expenditures at manufacturing facilities leased by General Electric Company. Main Street Municipal Development District — Assisted Penobscot Development Limited Liability Company in financing the extraordinary costs of acquisition and environmental remediation of the former Gasworks site on Main Street, ultimately to provide land area necessary for the construction of a 54,000 square foot supermarket in a Community Development project area. Pickering Square Municipal Development District — Assisted Realty Resources Chartered in a major redevelopment project that converted the former Freese's department store building into affordable housing units. Downtown Municipal Development District — To partially finance in excess of $70 million dollars.of infrastructure improvements within the boundaries of the district. Mall Area Traffic Infrastructure District — To partially finance traffic infrastructure improvements in the � Bangor Mall area and environmental improvement projects in the Penjajawoc Marsh/Bangor Mall area. II=48 • . CITY OF BANGOR, MAINE Notes to the Financial Statements, Continued � OTHER INFORMATION, CONTINUED C. Contingent Liabilities In February 1998, the City was served Notification of Potential Liability by the Federal Environmental Protection Agency (EPA) in connection with that agency's efforts to clean up a disposal site. The City is among approximately 500 potentially responsible parties. At this time, the group is in the process of implementing the remedy for the off-site area and continue to negotiate with the EPA for the final remedy of the on-site area. The EPA is expected to file the final Consent Decree prior to June 30, 2008. Based upon the recent passage of LD 1929, there should be no further costs to the City. LD 1929 established a program to fund clean up costs at this site for certain parties, including municipalities. In 2002, the City filed suit against Citizens Communication Company (Citizens), a potentially responsible party to force cleanup of contamination of the Penobscot River bottom due to the inability to reach settlement. In September of 2005, the U.S. District Court issued an Order finding that the City is responsible for 40% of the remediation costs. In July 2007, the City reached a settlement agreement with Citizens, whereby the City received $7.625 million to be held in escrow and applied to the cost of remediation. At this time, the cost of the remediation, which could range from $6 - $14 million, is unknown. The City is a party to various other lawsuits. Although the outcome of these lawsuits is not presently determinable, it is the opinion of the City's counsel that resolution of these matters will not have a material adverse efFect on the financial condition of the City. D. Retirement The City of Bangor provides retirement pensions.for its employees through a number of vehicles, including a defined contribution plan,.defined benefit pension plan and social security. Defined Contribution Plan Description of the Plan - The City provides pension benefits for certain employees through a 401(a) defined contribution plan administered by ICMA/RC. In addition certain full-time employees are covered through both a 401 (a) and 457 Deferred Compensation Plans (DCP) also administered by ICMA/RC. In a DCP, benefits depend solely on amounts contributed to the plan plus investment � earnings. Covered employees are eligible to participate and are fully vested from the date of employment. Fundin_�x — Plan members not covered by employment contracts are required to contribute 6.5% of their annual covered salary and the City is required to contribute either 8% or 10% depending upon the employee's classification. For fiscal year 2008 covered payroll was $11,022,535 and City contributions were $93'S,496. For those plan members that have employment contracts, the City contributes at various rates from 8% - 15% of annual earnings. The covered payroll and City contributions for those employees with employment contracts approximated $455,024 and $52,304 respectively, in fiscal year 2008. . ' II-49 CITY OF BANGOR, MAINE Notes to the Financial Statements, Continued OTHER INFORMATION, CONTINUED De�ined Benefit Pension Plan Description of the Plan — The City contributes to the Maine Public Employees Reti'rement Consolidated Plan, a cost sharing multiple-employer retirement system established by the Maine State legislature. The Maine Public Employees Retirement System provides retirement and disability benefits, annual cost-of-living adjustments, and death benefits to plan members and beneficiaries. The authority to establish and amend benefit provisions rests with the state legislature. The Maine Public Employees Retirement System issues a publicly available financial report that includes financial statements and required supplementary information for the Consolidated Plan. That report may be obtained by writing to Maine Public Employees Retirement, 46 State House Station, Augusta, Maine 04333-0046 or by calling.i-800-451-980.0. Funding Policy — Plan members are required to contribute 6.5% of their annual covered salary and the Ciry is required to contribute an actuarially determined rate. The current rate ranges from 2.80% to 6.50% of annual covered payroll. The contribution rates of plan members and the City are established and may be ame.nded by the Maine Public Employees Retirement System Board of Trustees. The City's contributions to the Maine Public Employees Retirement System Consolidated Plan for the years ended June 30, 2008, 2007, and 2006 were $703,675, $701,159, and $701,017 respectively, equal to the required contributions for each year. Teachers Group Description of the Plan - All school teachers, plus other qualified educators, participate in the Maine Public Employees Retirement System's teacher group. The teacher's group is a cost-sharing plan with a special funding situation, established by the Maine State legislature. The Maine Public Employees Retirement System provides retirement and disability benefits, annual cost-of-living adjustments, and death benefits to plan members and beneficiaries. The authority to establish and amend benefit provisions rests with the state legislature. The Maine Public Employees Retirement System issues a publicly available financial report that includes financial statements and required supplementary information for the Teacher's Group. That report may be obtained by writing to Maine Public Employees Retirement System, 46 State House Station, Augusta, Maine 04333-0046 or by calling 1-800-451-9800. � � Funding Policx — Plan members are required to contribute 7.65% of their compensation to the retirement system. The same statute requires the State of Maine Department of Education, to contribute the employer contribution, which amounts to $4,407,544 (19.14%) for the fiscal year 2008. This amount has been reported as an intergovernmental revenue and education expenditure in the GAAP basis financial statements. There is no contribution required by the school department except for federally funded teachers, for which they contributed 18.71% of their compensation. This cost is charged to the applicable grant. • Deferred Compensation Plan The City offers its employees a deferred compensation plan created in accordance with Internal Revenue (IRC) Section 457. The plan permits participating employees to defer a portion of their salary II- 50 � CITY OF BANGOR, MAINE Notes to the Financial Statements, Continued OTHER INFORMATION, CONTINUED until future years. The deferred compensation is not available to employees until termination, � retirement, death, or unforeseeable emergency. Social Security � The City does not have a section 218 agreement to provide full social security coverage to its - employees. The City does provide full social security coverage to part-time, seasonal and temporary employees under the Omnibus Budget Reconciliation Act of 1990, and Internal Revenue Service regulations, which became effective July 1, 1991. E. Landfill Closure and Postclosure Care Costs Closure of the City's Kittredge Road landfill was completed during the fiscal year ended June 30, 2000. Potential postclosure costs have been deemed immaterial, and therefore no liability for these amounts has been accrued. All necessary postclosure costs will be funded from the annual operating budget. F. Subsequent Events Since June 30, 2008, the City has authorized the execution of contracts for energy conservation measures in the amount of $11,183,679. Of that amount the City expects to finance $8,321,679 ' through lease/purchase agreements and the remaining balance will be funded with existing resources. � These contracts are for capital improvements resulting from a City-wide energy audit. Under our contract the annual energy savings have been guaranteed to cover the repayments, if the agreed upon savings are not achieved the vendor is required to reimburse the City for the differ.ence. On October 15, 2008, the City Council autliorized the issuance of.$1,569,000 in general obligation bonds for the purpose of funding the Ciry's annual fleet replacement, replacement of Fire Station #6 and the local share of State of Maine road projects. The City Charter requires maintaining the City's undesignated/unreserved fund balance at between 5% and 10% of the previous year's expendifures, net of debt service. As policy, the City has targeted 7.5% as a reasonable balance. At June 30, 2008, this balance exceeded the City policy of 7.5% by $1,791,649. Further City policy prescribes uses for these excess funds, and the Council has been presented with a series of options for the surplus funds. Thus far, Council has appropriated funds from the undes'ignated/unreserved fund balance in the amount of $200,000 to fund further environmental assessment of the Penobscot river as well as legal costs. ; II- 51 � , This page left intentionally blank � � - r � GENERAL FUND . The General Fund is used to account for resources traditionally associated with the , government, which are not required legally or by sound financial management, to be accounted for in another fund. - -- __` , , ` . ; . f \ � :' � � -_�.=�� 'i , � ,1 ~'; ;°� - ,' - , /i ` ,�_� ^_� `" ' - �� / , � . ,�- ��r, ` T' ` � . �� --�� '� V _ `\ i�/, . � �' . _�-- - ' � , J Schedule A-1 � CITY O�'BANGOR,MAINE ) Bal'ance Sheet 'l General Fund J , June 30,2008 `�� " : ASSETS 1 � Cash and cash equivalents , $ 2,309,062 Investments 8,451,582 � Receivables: T�es 1,953,560 � Accourits(net of allowance of$264,217) 833,323 'j Interfund loans 4,439,998 � � Intergovernmental 1,768,425 I Loans 1,090,598 � Inventory,at cost 754,99.0 _i Prepaid items 56;667 � Total assets $ 21,658,205 � � , LIABILITIES AND FUND BALANCE ; Liabilities . . Accounts payable $ 1,241,244 .�� Accrued wages and benefits payable 4,347,373 ) Deferred revenue 1,830,278 Total liabilities 7,418,895 � Fund balance ' Reserved for: ' Encumbrances 929,953 % Prepaid items 56,667 Advances to other funds 1,650,500 , Unreserved: i Designated(Note J) � 3,594,074 Undesignated 8,008,116 Total fund balance 14,239,310 , _ � � Total liabilities and fund balance $ 21,658,205 � _J .1 a � J � J II- 52 � 1 , Schedule A-2 , CITY OF BANGOR,MAINE _ Schedule of Revenues,Expenditures and Changes in Undesignated Fund Balance-Budget and Actual-Budgetary Basis General Fund For the Fiscal Year Ended June 30,2008 Balances • Variance ' Carried 7/1/2007 Budget. Actual Surplus Carried ' Revenues . Taxes Real and personal property $ - $ 43,652,249 $ 43,775,939 $ 123,690 $ - Change in deferred property tax . - - (324,867) (324,867) - _ Ta�c increment financing district . - (1,161,550) (1,161,550) - - Payment in]ieu of ta�ces - 145,000 122,509 (22,491) - Excise - 4,476,500 4,641,320 164,820 - Interest on delinquent ta�ces - 200,000 194,333 (5,667) - Total ta�ces � 47,312,199 47,247,684 (64,515) - Intergovernmental State revenue sharing ' . - 4,050,000 4,852,999 802,999 - School subsidy - 16,678,579 16,684,132 - 5;553 Other- municipal - 2,298,897 2,301,853 2,956 - . school - 3;594,986 3,960,990 . - 366,004 �,� Total intergovernmental - 26,622,462, 27,799,974 805,955 371,557 � Other revenue � Licenses and permits - 537,550 956,965 419,415 - Charges for service- municipal - � 7,771,764 7,543,048 (228,716) - school - 3,909,687 4,539,787 - 630,100 Fines,forfeits and penalties • � - 27;550 24,361 (3,189) - Revenue from use of money and property- , municipal ' - 780,446 855,255 74,809 - Total other - ]3,026,997 13,919,416 262,319 630,100 Total revenues - 86,961,658 88,967,074 1,003,759 1,001,657 J \ II- 53 ` Schedule A-2 (con't) CITY OF BANGOR,MAINE Schedule of Revenues,Expenditures and Changes in Undesignated Fund Balance-Budget and Actual-Budgetary Basis General Fund For the Fiscal Year Ended June 30,2008 Balances Variance Carried 7/1/2007 Budget Actual Surplus Carried Expenditures General government , Council - 43,448 35,853 7,595 - Executive - 739,163 733,856 5,307 - , Human resources - 111,306 100,384 ]0,922 - City clerk - 402,173 387,599 ]4,574 - Assessing - 397,426 398,419 (993) - Legal - 276,929- 279,479 (2,550) - Finance - 1,511,668 1,466,491 45,177 - Insurance - 153,999 144,318 9,681 - Planning,econ dev,code enforcement - 1,114,630 1,111,963 2,667 � - Total general government - 4,750,742 4,658,362 92,380 - Public safety Police - 7,196,307 7,011,230 185,077 - Fire - 7,358,174 7,603,761 (245,587) - Total public safety - 14,554,481 14,614,991 (60,510) - Health,community services and recreation � Health and community services - 2,728,595 2,886,107 (157,512) - Pazks and recreation - 1,411,377 ],420,286 (8,909) - Total health,welfare and recreation - 4,139,972 4,306,393 (166,421) - Public buildings and services - 9,979,531 9,891,087 88,444 - � � II- 54 Schedule A-2 (con't) CITY OF BANGOR,MAINE Schedule of Revenues,Expenditures and Changes in Undesignated Fund Balance-Budget and Actual-Budgetary Basis General Fund � For the Fiscal Year Ended June 30,2008 Balances Variance Carried , 7/1/2007 Budget Actual Surplus Carried Expenditures,continued Other agencies County tax . - 2,406,563 2,406,563 - - Downtown Development District - 49,296 49,296 - - Public library - , 1,501,491 1,501,491 , - - Otheragencies 22,950 268,717 270,202 (13,985) . 35,450 . Total other agencies 22,950 4,226,067 4,227,552 (13,985) 35,450 Education Regular 1,733,967 39,695,116 39,400,513 - 2,028,570 Adult education 187,617 559,290 515,749 - 231,158 Schoollunch 54,180 1,190,017 1,217,253 - 26,944 Readingassessment 21,183 10,000 - - 31,183 Special revenue , 151,895 2,527,071 2,539,941 - 139,025 Trust and agency 142,209 1,141,120 1,221,800 - 61,529 Total education 2,291,051 45,122,614 44,895,256 - 2,518,409 Other appropriations . Pensions and other fringe benefits - 1,881,405 1,862,424 18,981 - Debt service - 2,263,118 2,257,417 5,701 - Tax increment financing payments - 414,901 425,351 (10,450) - ' Total other appropriations - 4,559,424 4,545,192 14,232 - Total expenditures 2,314,001 87,332,831 87,138,833 (45;860) 2,553,859 Excess(deficiency)of revenues over/under expenditures (2,314,001) (371,173) 1,828,241 957,899 3,555,516 . , II - 55 � Schedule A-2(con't) CITY OF BANGOR,MAINE Schedule of Revenues,Expenditures and Changes in Undesignated Fund Balance-.Budget and Actual-Budgetary Basis General Fund For the Fiscal Year Ended June 30,2008 Balances Variance Carried 7/1/2007 Budget �Actual Surplus Carried Other financing sources(uses) Appropriaton from designated fund balance - 1,681,823 399,380 (535,593) (746,850) Sale of assets ' ' - . 2,000 78,428 76,428 - Contributions - 15,000 15,000 - - � Insurance Settlements - - 6,642 6,642 - Transfers to other funds - � (615,919) (1,365,919), (750,000) - Transfers from other funds - 39,500 32,980 (6,520) - Operating transfers - (751,231) (751,231) - - Total other financing sources(uses) - 371,173 (1,584,720) (1,209,043) (746,850) . ' Net change in fund balance $ (2,314,001) $ - $ 243,521 (251,144) $ 2,808,666 Undesignated fund balance,beginning of year 8,259,260 Undesignated fund balance,end ofyear • $ 8,008,116 , i' i II -56 r NONMA.�OR GOVERNMENTAL FUNDS Special Revenue Funds� Special Revenue Funds are used to account for specific revenues that are legally restricted to expenditures for particular purposes. � Other HUD Funds —This is used to account for 1) federal grants obtained and expended under the Housing and CommunityrDevelopment_Act of 1974, as amended, for the redevelopment of the downtown-commercial core of the�City and 2) low interest loans to businesses within the Ciry of:Bangor for establishment,expansion or redevelopment purposes. � , . -- � i - � _ / � `\ -. r '. ' ~ � ��, Grant Fund Accounfis,forifederal an�'state�grants�that ;are legally restricted to expenditures allowable by tFie grantor�agency �., ''� „ , , . � �! � .i �% � `-- � : � ' Dedicated Revenue Funds - Accounts for amounts `r�aised or donated to benefit various governmental prograrns' such as; the� Dental Clirnc;,local p,arks, Ci,ryl,forest and.Park Woods complex. � } I L- `�-.� r, � � � '�� , r l- � 1 � 1. ��""`•�+/r�- '` `- �1��J �v t � � , Other Funds —Accounts`for�funds��held to be used in future periods suchf as tax financing district repayments-and other commanity funds for�capital'expenditureslrelating fo the operation of the area transportation�'sy"stem 5� :? �� --,-,� �--`�'�� ,�-. ' .- - :1,` � : , - , ; ,;;�.�---,—.-�-- � ,; � Permanent�Fund .�,w"_��s,. � � Permanent funds are used.to�-report`resources that are legally restricted to the extent � . that only earnings, not principal,`:may" be used.for purposes that support the reporting government's programs. - ` � � � ' � J Schedule B-1 �� ' CITY OF BANGOR,MAINE� ' Combining Balance Sheet Nonmajor Governmental Funds - June 30,2008 � ' Nonmajor Special Nonmajor TotalOther Revenue Permanent Governmental Funds Funds Funds ASSETS Cash and cash equivalents $ 43 $ - $ 43 � Investments 239,886 106,792 346,678 � Receivables: Accounts 1,025 - 1,025 Interfund 113,256 - 113,256 Loans 1,736,056 949,089 2,685,145 Intergovernmental 297,804 - 297,804 Total assets $ 2,388,070 $ 1,055,881 $ 3,443,951 , LIABILITIES AND FUND BALANCES Liabilities Accounts payable $ 76,295 $ - $ 76;295 ' Deferred revenue 328,459 - 328,459 Interfund loans 168,844 - 1b8,844 Total liabilities 573,598 - 573,598 Fund balances � Reserved,principal - 656;658 656,658 Unreserved,undesignated 1,814,472 399,223 2,213,695 Total furid balances 1,814,472 1,055,881 2,870,353 , Total liabilities and fund balances $ 2,388,0'70 $ 1,055,881 $ 3,443,951 J i ,� � ,\ � � ,, ; ,, , � ' II- 57 i �- �i , Schedule B-2 CITY OF BANGOR,MAINE Combining Statement of Revenues,Expenditures and Changes in Fund Balances Nonmajor Governmental Funds For the Fiscal Year Ended June 30,Z008 Nonmajor Special Nonmajor TotalOther Revenue Permanent Governmental Funds Funds Funds � Revenues Taxes $ 915,654 $ - $ 915,654 Intergovernmental 5,421,009 - 5,421,009 Charges for services . 910,858 - 910,858 Program income 24,462 - 24,462 Revenue from use of money and property 266,061 - 266,061 , � Other revenue 13,375 2,071 15,446 Interest revenue - 42,431 42,431 Total revenues ` 7,551,419 44,502 7,595,921 Expenditures , Current: . Personnel 905,720 - 905,720 � Equipment - 67,196 - 67,196 % Payments to beneficiaries 935,838 - 935,838 Other � 3,111,l 99 - 3,111,199 Bus operations 2,078,619 - 2,078,619 Program expenditures - 4,043 4,043 Total expenditures 7,098,572 4,043 7,102,6.15 Excess(deficiency)of revenues over(under)expenditures 452,847 40,459 493,306 Other financing sources(uses) Transfer to other funds . (72,980) (10,800) (83,780) Transfer from other funds - 522 522 Total other financing sources(uses). (72,980) (10,278) (83,258) Net change in fund balances 379,867 30,181 410,048 Fund balances,beginning of year 1,434,605 1,025,700 2,460,305 Fund balances,end of year $ 1,814,472 $ 1,055,881 $ 2,870,353 J � II- 58 / Schedule B-3 CITY OF BANGOR,MAINE Combining Balance Sheet Nonmajor Special Revenue Funds June 30,2008 , Dedicated Other Grant Revenue Totals HUD Funds Fund Funds Other 2008 ASSETS Cash and cash equivalents $ - $ 43 $ - $ ' - $ 43 Investments , - - , - 239,886 239,886 Receivables: Accounts 1,000 25 - - 1,025 Interfund 113,256 - - - 113,256 - Loans 328,459 - 750,558 657,039 1,736,056 Intergovernmental - 297,419 - 385 297,804 � Total assets $ 442,715 $ 297,487 $ 750,558 $ 897,310 $ 2,388,070 LIABILITIES AND FUND BALANCES � • Liabilities � Accounts payable $ - � $ 58,480 $ - $ . 17,815 $ 76,295 Deferred revenue 328,459 - - - 328,459 . Interfund loans payable 108,250 - 60,594 168,844 TotalliabiliGes 328,459 166,730 - 78,409 573,598 Fund balances Unreserved,undesignated 114,256 130,757 750,558 818,901 1,814,472 Total fund balances ` 114,256 130,757 750,558 818,901 1,814,472 Total liabilities and fund balances $ 442,715 $ 297,487 $ 750,558 $ 897,310 $ 2,388,070 • � � II-59 , Schedule B-4 CITY OF BANGOR,MAINE � Comb.ining Statement of Revenues,Expenditures and Changes in Fund Balances Nonmajor Special Revenue Funds . For the Fiscal Year Ended June 30,2008 Dedicated Other Grant Revenue Totals HUD Funds Fund Funds Other 2008 � Revenues Ta�ces $ ' - $ - $ - $ 915,654 $ 915,654 Intergovernmental - 5,421,009 - - 5,421,009 " Charges.forservices - 827,114 83,744 - 910,858 Program income 24,462 - - - 24,462 Revenue from use of money and property 1,259 - 60,040 204,762 266,061 Contributions - - 6,725 6,650 13,375 Total revenues 25,721 6,248,123 150,509 1,127,066 7,551,419 Expenditures Personnel " - 905,720 . - - 905,720 Equipment - 67,196 - - 67,196 Fayments to beneficiaries - - 7 935,831 �. 935,838 Other 1,694 3,098,045 ' - 11,460 3,111,199 Bus operations - 2,078,619 - - 2,078,619 Total expenditures 1,694 6,149,580 7 947,29] 7,098,572 Excess(deficiency)of revenues " , over(under)expenditures 24,027 98,543 ]50,502 179,775 452,847 Other financing sources(uses) Transfers to other funds , - - (45,980) (27,000) (72,980)' Transfers from other funds - - - - - Total other financing sources(uses) - - (45,980) (27,000) (72,980) Net change in fund balances 24,027 98,543 104,522 152,775 379,867 Fund balances,beginning of year 90,229 32,214 646,036 666,126 1,434,605 Fund balances,end of year $ ]14,256 $ 130,757 $ 750,558 $ 818,901 $ 1.,814,472 � II-60 � Schedule B-5 CITY OF BANGOR,MAINE , Combining Balance Sheet Nonmajor Permanent Funds June 30,2008 � Revolving Other Loan Funds Funds Totals � � � ASSETS , ' ' Investments $ - $ 106,792 $ 106,792 Loans receivable 921,832 27,257 949,089 \ , Total assets $ 921,832 $ . 134,049 $ 1,055,881 LIABILITIES AND FUND BALANCES Liabilities $ ' - $ - $ - Totalliabilities $ - $ - $ - � Fund balances ' � . Principal 522,609 134,049 656,658 � Unexpended income 399,223 - 399,223 Total fund balances 921,8.32 134,049 1,055,881 Total liabilities and and fund balances $ - 921,832 $ 134,049 $ 1,055,881 , � �, , , � � . . � . II- 61 . � . Schedule B-6 CITY OF BANGOR,MAINE , � Combining Statement of Revenues,Expenditures and Changes in Fund Balances Nonmajor Permanent Funds - For the Fiscal Year Ended June 30,2008 Revolving ' Other Loan Funds Funds Totals Revenues � � Investment income $ 47,689 $ (5,258) $ 42,431 Lot sales 2,071 - 2,071 Total revenues 49,760. , (5,258) 44,502 . Expenditures Current: � Payments to beneficiaries 74 3,000 3,074 Other.miscellaneous ' - 969 969 � ' Total expenditures 74 3,969 4,043 Excess(deficiency)of revenues � _ � over(under)expenditures 49,686 (9,227) 40,459 Other financing uses � � Transfer to other funds (10,800) - (10,800) Transfer from other funds 522 - 522 Total other financing uses (10,278) - (10,278) , Net change in fund balances 39,408 (9,227) 30,181 Fund balances,begirining ofyear 882,424 143,276 1,025,700 - Fund balances,end of year $ 921,832 $ 134,049 $ 1,055,881 II- 62 , This page left intentionaliy blank , � • . ENTERPRISE FUNDS � � Enterpcise Funds are used to account for.operations that are financed and operated in a . �. manner similar to private business enterprises. The intent of the government is to have . the costs of providing goods or services to the general public financed. or recovered , � primarily. through .user charges.. The government has, decided that periodic � determination of net income is appropriate for accountability purposes. . In addition to the major funds reported_in-Summary of Significant Accounting Policies, Note C the Giry has the following.no mn ajor enterprise funds: , �: _. Park Woods — This fund accounts for the rental of 60 units of�surplus housing received from the federal government:pursuant to=the McKi ey,Homeless Assistance Act. The � principal source of revenue is,.rental income: ,'-�, ``�� ,- : % � '� Parking Fund — Thi�fund acco�fnts forrth operation of the ity owned parking lots and � � the Pickering Square��ga`rage. Revenue sources=-include montfil"y`;lease.payments for parking spaces, hourlyjdaily parking"�fees; and:�fines and waiver fees for parking ' violations. Certai��of th'ese facilities are operated,.nder a�private'management contract. , � r .� .-� � ,� ! � +. �.� .�� :� ��' -��, ,� � . , Bass Rark Fund -This fund�accounts��forfthe operation of the,Bangor auditorium, Bangor Civic Center, and Bangor State�F,�air. `Principal�;sources�of�revenue�are admissions, concession sales, and rentals. Th�e�fund�is�named�after,= the Bass family, wliich � � � � ,� --__ ��,��,r.�� , . � bequeathed the property to,the�City for�recreational purposes., , � �� , r��. � ;. Municipal Golf Course —This fund aecoun�for tfie operation:of,a 27 hole municipal golf . course. Principal reve ue soucces are season memberships and;daily green fees. . Economic Develdpment Fund =�This fund.accounts for t�he o'peration and development of properties acquired by the City. It`s�purpose-is�toypromote economic growfih within the � City. The principal source of revenue is rental income. . ,� I � Schedule GI � CITY OF BANGOR,MAINE . � Combining Statement of Net Assets Nonmajor Proprietary Funds � June 30,2008 � Business-type Activities-Enterprise Funds . Bass 117unicipal Economic Total / Park Parking Park Golf Development Nonmajor `} Woods Fund Furid Course Fund Proprietary Funds J ASSETS , y ' 1 Current assets J Cash and cash equivalents $ 1,182 $ 194,046 $ 9,527 $ 98,040 $ , 104 $ 302,899 } Investmenis - 147,628 - 540,069 - 687,697 1 Accounts receivable - 7,855 130,739 2,000 1,387 141,981 � `I ' J Less allowance for uacollectible accounts - - (27,110) - - (27,110) Net accounts receivable - 7,855 103,629 2,000 1,387 114,871 . � Inventories,at cost - - 17,275 - - 17,275 , 'Prepaid items - - 29,099 - - 29,099 � Totalcurrentassets 1,182 349,529 159,530 640,109 1,491 1,151,841 � Noncurrent assets J • Capital Assets: \ Land and improvements 295,025 - 828,921 1,594,732 2,395,046 S,ll3,724 J Buildings and improvements 1,933,061 - 5;587,727 912,607 6,490,170 14,923,565 I Machinery and equipment 22,952 - 144,428 292,237 - 459,617 1 ]nfrastructure - - - - 67Q207 67Q207 �l Parking structures - 9,968,268 - - - • 9,968,268 - 2,251,038 9,968,268 6,561,076 2,799,576 9,555,423 31,135,381 Lessaccumulateddepreciation (1,187,071) (7,053,089) (5,125,967) (1,322,044) (999,558)' (15,687,729) � Net capital assets 1,063,967 2,915,179 1,435,109 1,477,532 8,555,865 15,447,652 i Loansreceivable - - - - 107,567 ]07,567. � _ Deposiu 20,000. - - - - 2Q000 � Total noncurrent assets ' 1,083,967 2,915,179 1,435,109 1,477,532 8;663,432 15,575,219 - � Total assets 1,085,149 3,264,708 ],594,639 2,117,641 ' 8,664,923 16,727,060 � � . � i • � \ , ,` / / . _� J ' � , J Continued on next page � II-63 . � � Schedule C-1 (con't) CITY OF BANGOR,MAINE Combining Statement of Net Assets � Nonmajor Proprietary Funds June 30,2008 Business-type Activities-Enterprise Funds Bass Municipal Economic Total Park Parking Park Golf Development Nonmajor Woods Fund Fund Course Fund Proprietary Funds LIABILITIES Current liabilities - , Accountspayable 27,841 29,926 38,857 13,777 9,811 120,212 Accrued wagesand benefitspayable 2,385 7,154 12,270 12,638 - 34,447 Accrued interest - 34,376 . ' 15,542 7,807 29,282 87,007 Workers'compensation - 3,846 5,959 - - 9,805 Uneamed revenue - 46,216 6,999 - - 53,215 Accrued compensated absences 33,475 8,825 54,710 ]0,441 - ]07,451 Interfundloans 266,000 - 1,843,255 - 659,500 2,768,755 General obligafion debt payable - 438,214 138,017 31,997 183,243 791,471 Deferted amount on refunding - (10,637) - - - (10,637) Other liabilities 2,000 - - - - 2,000 Total current liabilities � 331,701 557,920 2,115,609 76,660 881,836 3,963,726. Long-term liabilities � � Workers'compensation - 6,154 4,041 - - 10,195 General obligation debt payable - 3,122,491 1,127,326 597,284 4,028,865 8,875,966 Deferred amount on refunding - (10,333) - - - (]0,333) Other long-term liabilities 193,061 19,184 - - - 212,245 Total long-tertn liabilities 193,061 3,137,496 1,131,367 597,284 4,028,865 9,088,073 Totalliabilities 524,762 3,695,416 3,246,976 673,944 4,910,701 13,051,799 NET ASSETS Invested in capital assets,net of related debt 1,063,967 (475,720) 622,611 938,422 4,343,757 6,493,037 Unrestricted (503,580) 45,012 (2,274,948) 505,2Z5 (589,535) (2,817,776) Total net assets $ 560,387 $ (430,708) $ (1,652,337) $ 1,443,697 $ 3,754,222 $ 3,675,261 � � Continued from previous page II-64 • Schedule G2 CITY OF BANGOR,MAINE Combining Statement of Revenues,Expenses and Changes in Net Assets Nonmajor Proprietary Funds • For the Fiscal Year Ended June 30,2008 ' Business-type Activities-Enterprise Funds � � Bass Municipal Economic Totxl ' Park Pxrking Park Golf �Development Noomajor � , � Woods Fund Fund � .Coorse Fund Proprietary Funds Operating revenues� . � � � Chargesforservices � $ 34Q494 $ 7,001,697 $ ],426,599 $ 655,834 $ 422,716 $ 3,847,340 � Operating expenses ' ' ' . � � Operating expenses other than . � . depreciation and amortization 589,744 '779,305 ' 1,861,612 560,495 248,694 4,039,850 � Depreciation and amortization ' 89,123 478,381 67,964 107,596 224,958 968,022 Total operating expenses � � 678,867 1,257,686 1,929,576 668,091 473,652 5,007,872 � Operatingincome(loss) � (338,373) (255,989)� (502,977) (]2,257) (50,936) _ (1,16Q532) ` Nonoperating revenue(expenses) � Interest income �89 8,503 159 32,321 33,501 74,573� ' i � Interest expense - (18Q439) (63,629) (27,8'78) (222,199) � (494,145) ' � Total nonoperating revenue(expenses) ' 89 (171,936) (63,470) 4,443 (186,698) � � (419,572) . Nel income(loss)before grants/contributions and fransfers (338,284) (427,925) (566,447) (7,814) (239,634) (],580,104) Grants/contributions received for capital azsets . - - - - 273,147 273,147 Transfers to other.funds - (15,749) - (131,394) - (147,143) � ' Transfers from other funds - 297,446 488,785 - - 786,23]� Change in net assets � (338,284) (146,228) (77,662) (139,208) 33,513 (667,869) Netassets,beginningofyear 898,671 (284,480) (],574,675) 1,582,905 3,720,709 4,343,130 . � Net essets,end ofyear � $ 560,387 $ (430,708) $ (1,652,337) $ 1,443,697 $ 3,754,222 �$ 3,675,261 ' l , 1. � • II-65 1 ��- � , Schedule C-3 . CITY OF BANGOR,MAINE , ' ''' Combining Statement of Cash Flows-Nonmajor Proprietary Funds For the Fiscal Year Ended June 30,2008 � Business-type Activities-Enterprise Funds ` _ Bass Municipal Economic Total I Park Parking Park Golf Development Nonmajor -� Woods Fund Fund Course Fund Proprietary Funds Cash flows from operating activities v Cash received from customers $ 340,494 $ 1,O1i,078 $ 1,369,400 S 653,834 $ 821,329 $ 4,200,135 Cash paid to suppliers forgoods and services (491,323) (625,736) (1,040,744) (260,111) (275,613) (2,693,527) , ' , r -,, Cashpaidtoemployeesforservices (89,861) ' (214;531) (821,160) (319,166) - (],444,718) Net cash provided by(used in)operating � activities (24Q690) 174,811 (492,504) 74,557 545,716 61,890 Cash 11ows from noncapital financing activities . " Interfund loans(repayments) 238,000 - 196,000 - 238,000 672,000 ' ~ Transfers in - 297,446 488,785 - - 786,231 � Transfers out - (15,749) - (131,394) - (147,143) Net cash provided by(used in)noncapital • Snancingac[ivities ' 238,000 281,697 684,785 (131,394J 238,000 1,3ll,088 � Cash flows from capital and related financing activities ' , Acquisition and construction of capital asse[s - - - (217,858) (695,096) (912,954) , ` Principalpaid on genera]obligation bonds - i (444,175) (134,034) (31,7111 ' (176,288) (786,208) � Interest paid on genera]obligation bonds - (169,02]) (65,033) (28,289} (225,168) � (487,511) �' Grantmonies�receivedforcapitalassets . � - - - - � 273,147 273,147 � Investment ofunexpended bond proceeds - 82,364 - - - 82,364 1 ` Net cash provided by(used in)capital and related . , . financingactivities - (530,832) Q99,067) (27'7,858) (823,405) ((,831,162) ' - Cash flows from investing activities Net sales(purchases)of investrnents - 42,038 - 101,006 - • 143,044 ; � Interest on inveshnents 89 10,960 960 32,321 33,501 77,031 Loan repaymen[s - - - - 6,175 6,178 � Net cash provided by(used in)investing activities 89 52,998 160 133,327 39,679 226,253 � Netincrease(decrease)incash (2,601) (21,326) (6,626) (201,368) (]0) (231,931) � t Cash,beginning ofyeaz 3,783 215,372 16,153 299,408 114 534,830 � Cash,end of year $ 1,182 $ 194,046 $ . 9,527 S 98,040 S ]04 $ 302,899 ' ' l l � ', i Continued on next page • , II-66 Schedule C-3(con't) � CITY OF BANGOR,MAINE , Combining Statement of Cash Flows-Nonmajor Proprietary Funds — For the Fiscal Year Ended June 30,2008 Business-type Activities-Enterprise Funds ' � Bass • Municipel Economic Total -- Park Parking Park Galf Development Nonmajor � Woods Fund Fund Course � Fund Proprietary Funds � Reconciliauon of operating income(loss)to net cash provided by(used in)operating acfivities � Operating income(loss) $ (338,373) $ (255,989) $ (502,977) $ (12,257) $ (50,936) $ (1,160,532) ✓ AdjusUnents to reconcile operating income(loss) � . . � to net cash provided by(used in)operating ' y activities � ' , . . � Depreciation and amortiza[ion - 89,123 478,381 67,964 107,596 224,958 968,022 , Changes in assets and liabilities: ' (Increase)decrease in accounts receivable' � - (2,267) -(13,366) (2,000) 398,613 380,980 (Increase)decrease in inventories� � - - (3,326) . - - (3,326) +� (Increase)decrease in prepeid items - - 831 - - 831 Increase(decrease)in accounts payable 7,884 (62,374) 4,642 (14,065) (26,919) (90,832) _, Increase(decrease)in uneamed revenue - 15,648 (43,833) - - (28,185) Increase(decrease)in o[her curtent liabililies 676 1,412 (2,439) (4,717) - � � (5,068) , Total adjustrnents 97,683 430,800 10,473 86,814 596,652 1,222,422 Net cash provided by(used in)operating activities $ (240,690) $ 174,8ll $ (492,504) $ 74,557 $ 545,716 $ 61,890 � � Continued from previous page II-67 , � . � Schedule C=4 � � CITY OF BANGOR,MAINE Schedule of Revenues,Expenditures and Encumbrances . � v Budget and Actual-Budgetary Basis + Sewer Utility Fund-Enterprise Fund For the Fiscal Year Ended June 30,2008 ' Variance � Positive � Budget Actual (Negative) � � Revenues - ! Charges for services $ 6,658,881 $ 6,645,115 $ (13,766) Interest and other revenue 853,966 50,575 (803,391) ! Total revenues 7,512,847 6,695,690 (817,157) ' Expenditures and encumbrances . Salaries 1,085,492 1,068,787 16,705 Fringe benefits 296,975 282,752 14,223 � �, Supplies and materials 1,084,649 1,053,019 31,630 Contractual services 666,704 649,186 17,5]8 Interfund cl�arges 518,872 405,598 113,274 Miscellaneous 16,000 17,058 (1,058) � Debtservice 3,617,728 3,6]7,057 671 , Depreciation 1,634,576 1,689,332 (54,756) . Outlay 206,426 26,190 180,236 � Total expenditures and encumbrances 9,127,422 8,808,979 318,443 � Excess(deficiency) of revenues over/under expenditures and encumbrances $ (1,614,575) $ (2,113,289) $ (498,714) � , ' II - 68 Schedule GS CITY OF BANGOR,MAINE � Schedule of Revenues,Expenditures and Encumbrances ' Budget and Actual-Budgetary Basis � Airport Fund -Enterprise Fund . � For the Fiscal Year Ended June 30,2008 Variance . - Positive Budget Actual (Negative) � Revenues � Charges for services $ 13,302,525 $ 14,392,873. $ 1,090,348 , Interest and other revenue 872,400 1,015,230 142,830 Total revenues , 14,174,925 . 15,408,103 1,233,178 Expenditures and encumbrances � , . ' Salaries , 4,845,419 � 4,822,245 23,174 Fringe benefits 1,129,270 1,073,669 55,601 Supplies and materials 2,418,950 2,313,874 105,076 Contractual services 2,016,000 2,205,014 (189,014) Interfund charges 709,692 629,476 80,216 Miscellaneous 257,200 322,946 (65,746) Debt service 700,359 908,674 (208,315) Depreciation 6,700,000 7,225,830 (525,830) Outlay � 444,666 183,590 261,076 Credits (10,000) - (10,000) Total expenditures and encumbrances 19,211,556 19,685,318 (473,762) Excess(deficiency)of revenues over/under expenditures and encumbrances $ (5,036,631) $ (4,277,215) $ 759,416 II- 69 - Schedule C=6 CITY OF BANGOR,MAINE Schedule of Revenues,Expenditures and Encunnbrances Budget and Actual-Budgetary Basis � Park Woods=Enterprise Fund For the Fiscal Year Ended June 30,2008 '� Variance - Positive Budget Actual (Negative) Revenues Charges for services $ 426,120 $ 340,494 $ (85,626) Interest and other revenue . - 89 89 ' Total revenues 426,120 340,583 (85,537) Expenditures and encumbrances Salaries 73,636 74,121 (485) Fringe benefits � 15,498 15,064 � 434 Supplies and materials , 127,850 150,459 (22,609) Contractual services 147,825 157,340 (9,S l 5) , Interfund charges 5,640 3,765 1,875. � . Miscellaneous 100 3,429 (3,329) Depreciation 89;123 89,123 - ' Outlay 2,400 1,398 1,002 Total expenditures and encumbrances 462,072 494,699 (32,627) Ezcess(deficiency) of revenues over/under expenditures and encumbrances $ (35,952) $ (154,116) $ (118,164) . II - 70 . Schedule C-7 CITY OF BANGOR,MAINE Schedule of Revenues,Expenditures and Encumbrances Budget and Actual-Budgetary Basis Parking Fund-Enterprise.Fund . For the Fiscal Year Ended June 30,2008 Variance Positive Budget Actual (Negative) Revenues Charges for services ' $ 980,000 $ 1,001,695 �$ 21,695 : Operating transfer 297,446 297,446 - Interest and other revenue - 7,310 7,310 " Total revenues 1,277,,446 1,306,451 29,005 Expenditures and encumbrances Salaries 167,828 172,646 (4,818) Fringe benefits 45,569 39,461 6,108 Supplies and materials 6,250 3,456 2,794 Contractual services 352,305 309,238 43,067 Interfund charges 92,300 145,156 (52,856) Debt service 613,194 613,195 ' (1.) Depreciation 478,381 . 478,381 -. Outlay • - - - Total expenditures and encumbrances 1,755,827 1,761,533 (5,706) Excess (deficiency)of revenues over/under expenditures and encumbrances $ (478,381) $ (455,082) $ 23,299 , e � - II- 71 Schedule C-8 CITY OF BANGOR,MAINE Schedule of Revenues,Expenditures and Encumbrances Budget and Actual-Budgetary Basis Bass Park Fund-Enterprise Fund For the Fiscal Year Ended June 30,2008 Variance , Positive � Budget Actual (Negative) � Revenues ' Charges for services $ 1,535,600 $ 1,426,599 $ (109,001) Operating tran'sfer 484,285 453,785 (30,500). Interest and other revenue - 159 159 Total revenues 2,019,885 1,880,543 (139,342) Expenditures and encumbrances Salaries 649,322 675,929 (26,607) . Fringe benefits 157,723 135,907 21,816 Supplies and materials 322,220 410,153 (87,933) Contractual services 510,950 411,528 99,422 • Interfund charges 135,600 162,645 (27,045) Miscellaneous 55,000 51,073 3,927 Debt service 199,068 199,067 1 Depreciation 74,05] 67,964 6,087 Credits (10,000) (10,000) - � Total expenditures and encumbrances 2,093,934 2,104,266 (10,332) Excess (deficiency)of revenues over/under expenditures and encumbrances - $ (74,049) $ . (223,723) $ (149,674) . II- 72 Schedule C-9 CITY OF BANGOR,MAINE , Schedule of Revenues,Expenditures and Encumbrances Budget and Actual-Budgetary Basis � Municipal Golf Course-Enterprise Fund For the Fiscal Year Ended June 30,2008 . _- , , Variance Positive Budget Actual (Negative) Revenues Charges for services $ 635,000 $ 655,834 $ 20,834 Interest and other revenue 25,000 32,321 7,321 Total revenues 660,000 688,155 28,155 Expenditures and encumbrances Salaries 268,217 275,879 (7,662) Fringe benefits 40,070 37,329 2,741 Supplies and materials 77,710 99,449 (21,739) Contractual services 73,851 70,316 3,535 Interfund charges 79,152 195,674 (116,522) � Debt service 60,000 60,000 -. Depreciation 98,892 107,596 (8,704) Outlay 61;000 136,395 (75,395) Total expenditures and encumbrances 758,892 982,638 (223,746) �Excess (deficiency)of revenues over/under expenditures and encumbrances $ (98,892) $ (294,483) $ (195,591) , � , II - 73 � Schedule C-10 CITY OF BANGOR,MAINE ' Schedule of Revenues,Expenditures and Encumbrances Budget and Actual-Budgetary Basis � Economic Development Fund-Enterprise Fund For the Fiscal Year Ended June 30,2008 � Variance Positive Budget Actual (Negative) Revenues ' � Charges for services � $ 312,786 $ 422,716 $ . 109,930. Interest and other revenue 514;410 439,678 (74,732) Total revenues , 827,196 862,394 35,198 Expenditures and encumbrances Supplies and materials 36,590 48,383 (11,793) Contractual services 201,643 173,963 . 27,680 Interfund charges - 10 (10) Miscellaneous 2,488 2,269 219 Debt service 401,456 401,456 - Depreciation 203,714 224,958 (21,244) Outlay 185,000 24,069 160,931 Total expenditures and encumbrances 1,030,891 875,108 155,783 Excess(deficiency)of revenues over/under expenditures and encumbrances $ (203,695) $ (12,714) $ 190,981 II =74 This page left intentionally blank ' , , . � ' � � � �. FIDUCIARY FUNDS Fiducia .ry Funds are used to report assets held in a trustee or agency capacity for others. � . Agency Funds —Agency Funds are used to account for situations where the City's role is - � purely custodial, such as the receipt, temporary investment, and remittance of fiduciary resources to individuals, private organizations, or other governments. � � -�.�` �� . \ � ;. ; . , ; ; 2 j. " ' �i_~1`r .. � .. . � �`. . • \ ,`� ... . . _",. . . . � 4 '� . _ _ . 1�� . . '�'� '1 . . . .'-4;-..�.� � . '�=`�--:.._.�_: - t;, : � - �' -----, ; . • . � , - . � r' ._' I� . . L , � �', � _��j'~ � �'.�-, �ti . �a � ,-�'c-'c� j ��__ , � . 1 , � Schedule D-1 � CITY OF BANGOR,MAINE _,� Statement of Change in Assets and Liabilities �. Agency Fund ! For the Fiscal Year Ended June 30,2008 , , Balance � Balance � July 1,2007 Additions Deletions June 30,2008 1 ASSETS � American Folk Festival funds $ 12,009 $ 800,915 $ 801,049 $ 11,875 � Bangor E1rea Stormwater Group 25,982 150,820 132,813 43,989 J School Activity Funds 95;533 222,087 214,259 103,361 J Total.assets $ 133,524 $ 1,173,822 $ 1,148,121 $ 159.;225 ; LIABILITIES � _i Funds held for American Folk Festival $ 12,009 $ 800,915 $ 801,049 $ 11,875 Funds held for Bangor Area Stormwater Group 25,982 150,820 132;813� 43,989 ` Funds held for Schooi.Activity Funds 95,533 222,087 214,259 103,361 � : ` Total liabilities $ 133,524 $ 1,173,822 $ 1,148,121 $ 159,225 � � ', ; , � �. ) :\ � � � ' � l , il- �s J ; CAPITAL ASSETS USED IN THE OPERATION ` OF GOVERNMENTAL FUNDS � . - ; ,,- � � , � , . � . . � � � r - � E � � ,. ., � j �� _ ' � `, . ;;,,, _ _ : '� r �`� " _� - �I��. I' ) _ � . . , . � � p�p ll��' � � , Schedule E-1 CITY OF BANGOR,MAINE % Capital Assets Used in the Operation of Governmental Funds (net of accumulated depreciation) Schedule of Changes by Function and Activity '� For the Fiscal Year Ended June 30,2008 Balance � Balance Function and Activity 2007 Additions Deletions 2008 General_government Animal control $ 2,200 $ - $ 1,469 $ . 731 BAT community connector 1,113,948 - 151,121 962,827 Central service 28,845 - 3,846 24,999 City clerk 33,809 - 6,587 . 27,222 . City hall 498,854 - 17,383 481,471 Community and economic development 4,614,810 884,134 1,074,358 4,424,586 Engineering , 49,220 - 2,829 46,391 Information services 424,969 - 185,891 239,078 , Legal 3,630 - 2,420 1,210 Motor pool 3,851,895 817,387 585,112 4,084,170 � Other-unclassified 624,846 - 74,525 550,321 Total general government 11,247,026 1,701,521 2,105,541 10,843,'006 Public safety Fire 3,202,011 1,913,744 1,422,714 3,693,041 Police 11,237,607 10,680,592 10,397,808 11,520,391 Total public safety 14,439,618 12,594,336 11,820,522 15,213,432 Health,community services and recreation , i Health and community services - - - - Parks and recreation 2,750,668 94,216 251,779 2,593,105 � Total health,welfare and recreation 2,750,668 94,216 251,779 2,593,105 Public building and services Public works 18,077,368 888,656 1,577,389 17,388,635 Total public buildings and services 18,077,368 888,656 1,577,389 17,388,635 � Education 27,339,357 855,173 1,218,632 26,975,898 Total governmental fund capital assets $ 73,854,037� $16,133,902 $ 16,973,863 $73,014,076 � : l , II-76 i 1 � OTHER INFORMATION ,, _ __ _` ' � . , � : � , �� ; , ; , � � .-� � �� - . - ; .,_ r�C;.,,� � i' � r j `1 -^r i�'. f ' �. -' � (� � ".r'ti-1, r,( �f � �_��=i f.,`�.� � �� . . A ' . . + �C;=')�7 - � . . _ . .��.�_�`� • � � . Schedule F-1 � CITY OF BANGOR,MAINE _� Assessed Valuafion,Commitment and.CollecNons `� For the Fiscal Year Ended June 30,2008 - VALUATION .� �; � . � Land and buildings $ 2,082,355,000 , Land and buildings-Homestead exemption 68,742,200 J Personal property 254,991,600 ''� J Total valuation, $ 2,406,088,800 � CONIIVIITMENT _� � Real estate and personal property(excludes Homestead exemption) $ 2,337,346,600 � Ta�c rate 0.01880 � � Total commitrnent 43,942,116 ,� ADD . � � Supplemental taxes committed 140,360 � 44,082,476 , '; LESS ; � Collections 2008 42,847,656 '� Abatements 341,521 _ � . '1 2008 taxes receivable at June 30,2008 $ 893,299 . . 1 1 , � � � � � . � + . _� � , ) � � � � II- 77 � , , � Schedule F-2 CITY OF BANGOR,MAINE , Undesignated Fund Balance Sufficiency Calcutation For the Fiscal Year Ended June 30,2008 , �t is the policy of the City to maintain an undesignated fund balance approximately 7.5%of operating expenditures. The following table sets forth the calculation as to the sufficiency of , the June 30, 2008 undesignated fund balance. General Fund expenditures/uses( Schedule A-2) � General government , $ 4,658,362 ' Public safety 14,614,991 Health, community services and recreation . 4;306,393 Public buildings and services 9,891,087 Other agencies 4,227,552 Education 44,895,256 Other appropriations 4,545,192 Other uses,gross* 2,117,150 Gross expenditures and uses 89,255,983 General Furid debt service _ � 6,369,752 Net expenditures and uses $82,886,231 Indicated undesignated fund balance @ 7.5% $ 6,216,467 Actual undesignated fund balance(Schedule A-2) $ 8,008,116 Actual undesignated fund balance as a percentage of net expenditures and uses 9.66% Over(under)funded status $ 1,791,649 * excludes amounts appropriated from undesignated fund balance II- 78 Th is page left� i ntentiona I ly bla n k , � , � STATISTICAL SECTION � This part of the City of Bangor's comprehensive annual financial report presents � detailed information as a context for understanding what the information in the . � financial statements, note disclosures and required supplementary information says about the government's overall financial health. � Page � Financial Trends III - 1 The schedules contain trend information to help the reader understand how the City's financial performance and well-being have changed over time. , Revenue Capacity . III - 8 These schedules contain information to help the reader assess the City's most significant local revenue source, the property tax. � Debt Capacity � III - 12 � These schedules�present information�to help the reader assess the affordability of the City's current levels of outstanding debt and the -� . �ability to issue additional debt in the future. , � Demographic and Economic Information ' - III - 16 . These schedules offer demographic and economic indicators to help � the reader understand the environment within which the City's financial activities take place. � � Operating Information III - 18 . These schedules contain service and infrastructure data to help fihe reader understand how the information in the City's financial report relates to the services the City provides and the activities it performs. , . � . . , " Table l � CITY OF BANGOR,MAINE Net Assets by Component Last Ten Fiscal Years (accrual basis of nccounting) Fiscal Year 2003* 2004* 2005* 2006* 2007 2008 ' Goverrunental activities: � Invested in capital assets,net of related debt $ 35,304,708 $ 41,565,642 $ 46,993,577 $ 48,7�7;054 $ 48,257,039 $ 49,447,154 Resficted 507,743 510,433 513,851 1,002,525 1,055,881 656,658 Unrestricted (16,178,265) (20,154,733) (21,O1Q448) (21,528,721) (9,784,221) (]5,155,253) Total govemmental activities net assets 19,634,186 21,921,342 26,496;980 28,180,858 39,528,699 34,948,559 � � Business-type activities: ' Invested in capital assets,net of related debt 149,863,511 148,218,655 150,970,961 154,068,754 �157,302,400 154,066,934 Restricted - - - - - - Unrestricted 19,579,29] 21,096,167 21,705,461 16,998,096 14,715,610 17,219,955 Total business-type activities net assets 169,442,802 169,314,822 172,676,422 171,066,850 172,018,010 171,286,889 � - Primary government: , Invested in capital assets,net of related debt 185,168,219 189,784,297 197,964,538 202,775,808 205,559,439 203,514,088 ' � Restricted 507,743 510,433 513,851 ],002,525 1,055,881 656,658 UnresVicted 3,401,026 941,434 695,013 (4,530,625) 4,931,389 2,064,702 ,Total primary govemment net assets $189,076,988 $191,236,164 $199,173,402 $199,247,708 $2ll,546,709 $206,235,448 Only six years have been presented because 2003 was the year GASB Statement No.34 was implemented. "-Certain amounts have been reclassified to confortn with 2007 presentation. I ) � � , � � , - , ❑I-1 . , Table 2 CITY OF BANGOR,MAINE Changes in Net Assets � Last Ten Fiscal Years (accrual basis of accounting) Fiscal Year 2003 2004 2005 2006 2007 2008 Expenses .. Governmental activities: General government $ 6,060,687 $ 6,487,572 $ 6,435,386 $ 6,947,106 $ 7,052,860 $ 8,744,549 Public safety 11,114,804 12,066,567 12,478,326 12,890,750 13,756,962 14,945,855 Health,community services and recreation 3,340,989 3,606,827 4,000,249 7,301,546 7,348,875 8,413,205 � Public building and services . 7,OSQ085 7,360,360 7,609,989 8,256,266 8,659,473 9,142,251 Other agencies 3,322,395 3,273,003 3,514,658 3,610,935 3,787;970 4,829,547 , Education 40,828,756 40,279,055 42,659,395 45,522,795 46,106,647 47,537,197 Unclassified 2,044,069 389,598 65,639 947,025 1,136 - Restricted grants'� 6,551,455 6,857,039 7,326,307 - - - " Arena Development - � - - - 417,030 41,091 Community development* - - - 2,419,594 1,865,026 2,156,24] Streets/Sidewalks* - - - 2,9]1,131 2,884,655 1,359,002 Waterfront* - - - 990,961 399,015 1,754,281 Publictransportation* - - - 1,798,968 1,841,516 2,118,374 Tax increment financing* - - - 1,092,770 1,101,078 1,066,192 Interest on debt 740,077 3,083,447 3,166,250 3,098,248 1,952,612 3,206,764 Capital.maintenanceexpenses� 1,824,489 2,666,118 1,674,034 - - - Total governmental activities expenses 82,877,806 86,069,586 88,930,233 97,788,095 97,174,855 105,314,549 Business-type activities: Sew.erUtility 5,744,275 5,751,710 5,859,588 5,818,127 6,052,420 6,052,419 Airport 14,489,128 15;060,963 ]6,368,681 16,947,056 18,645,140 19,641,953 Park Woods .449,873 531,986 598,854 540,207 678,867 678,867 Pazking 1,370,737 1,431,983 1,425,508 1,322,138 1,438,125 1,438,125 Bass Park 1,944,718 1,935,653 1,889,215 1,918,1 ll 1,993,205 1,993,205 Municipa]GolfCourse 575,408 626,739 592,323 647,499 695,969 695,969 � Economic Development 271,047 338,795 397,881 484,264 695,851 695,851 Total business-type activities expenses 24,845,186 25,677,829 27,132,050 27,677,402 30,199,57� 31,196,389 Total primary govemment expe�se: $]07,722,992 $111,747,415 $116,062,283 $125,465,497 $127,374,432 $136,510,938 Only six years have been presented because 2003 was tNe year GASB Statement No.34 was implemented. *-Amounts previously reported as restricted grants and capital maintenance expenses have been classified into new functions beginning in 2006. ' � Continued on next page Ill-2 Table 2(con't) CITY OF BANGOR,MAINE , Changes in Net Assets Last Ten Fiscal Years (accrual basis of accounting) � Fiscal Year , 2003 2004 2005 2006 2007 2008 Program Revenues Governmental activities: ! Charges for services � General government $ 934,540 $ 1,103,382 $ , 1,447,058 $ 1,672,854 $ 2,334,040 $ 2,282,374 Publicsafety ],446,942 1,923,804 1,908,000 2,471,220 2,182,680 2,439,831 ' Health,community services and recreation 647,709 624,778 674,364 756,207 681,583 771,254 - Public buildings and services 3,043,886 3,537,702 3,766,334 , 4,076,981 3,871,412 3,967,990 � Other agencies - - - - - 22,243 Education 3,742,385 3,857,798 4,549,286 4,561;352 4,408,43] 4,539,787 � Unclassified 26,830 19,719 20,036 859,682 61,128 - Restricted grants 5,392,4�2 1,368,366 1,079,690 - - - . 4 Arena Development - - - - 1,630,360 . 1,689,657. Community development - - - 672,459 658,141 297,394' Streets/Sidewalks - - - - - 159,351 �, Public transportation - - - 536,491 659,960 809,531 Operating grants and contributions 2],566,478 24,743,028 25,986,614 29,577,430 30,534,706 41,370,518 . Capital grants and contributions 3,814,705 2,098,577 4,117,072 3,788,485 2,604,652 2,119,150 Total governmental activities program revenues 40,615,947 39,277,154 43,548,454 48,973,161 49,627,093 60,469,080 Business-type activities: Charges for services ' SewerUtility 6,569,790 6,281,870 5,97Q615 6,206,605 6,663,408 6,745,112 Airport 9,291,513 11,398,518 11,527,061 12,074,504 13,555,003 14,475,879 Pazk Woods 283,052 279,588 310,389 287,452 340,494 340,494 Pazking 807,645 892,820 943,990 963,697 1,001,697 1,001,697 - Bass Park 1,362,054 1,253,421 1,238,707 1,460,931 1,426,599 1,426,599 ' Municipal GolfCourse 623,233• 595,852 586,956 604,365 655,834 655,834 EconomicDevelopment 388;165 316,062 433,694 391,658 422,716 422,716 Capital grants and contributions 11,274,222 3,376,637 7,749,367 2,581,874 4,377,242 3,426,732 Total business-type activities program revenues 30,599,674 24,394,768 28,760,779 24,571,086 28,442,993 28,495,063 • Total primary government program revenue: $ 71,215,621 $ -63,671,922 $ 72,309,233 $ 73,544,247 $ 78,070,086 $88,964,143 , � Only six years have been presented because 2003 was the yeaz GASB Statement No.34 was implemented. , . 1 . 7 � ' ' � Continued on next page � ' III-3 Table 2(con't) CITY OF BANGOR,MAINE Changes in Net Assets . Last Ten Fiscal Years (accrual basis of accounting) v Fiscal Year 2003 2004 2005 2006 2007 2008 - ' Net(expense)/cevenue Govemmental activities $ (42,261,859) $ (46;792,432) $(45,381,779) $(48,814,934) $ (47,547,762) $(44,845,469) Business-typeactivities 5,754,488 (1,283,061) ],628,729 (3,106,316) (1,756,584) (2,701,326) � Total primary government expense (36,507,371) (48,075,493) (43,753,050) ,(51,92P,250) (49,304,346) (47,546,795) General revenues and other changes in net assets Governmental activities: Property taxes 37,624,392 39,936,976 4Q302,810 40,666,758 41;702,775 43,775,938 , Payment in lieu of taxes 113,575 135,000 186,500 ]6Q457 145,000 122,510 Excise taxes � 4,091,505 4,306,055 4,358,409 4,752,852 4,668,614 4,641,320 Franchise taxes 233,874 225,224 265,598 .. 2'14,986 296,566 300,768 Unrestricted gants and contributions 4,059,770 4,512,720 4,487,931 4,773,082 4,968,217 5,520,774 'r Unrestricted investment eamings 377,113 296,857 519,225 699,417 �, 1,183,796 1,274,939 Indirect cost chazges 557,165 483,439 472,056 - - - ' Miscellaneous 598,515 131,733 8,353 32,550 260,733 161,439 Transfers (798,618) (948,416) (837,806) (861,290) (871,864) (539,088) � • Total govemmental activities 46,857,291 49,079,588 49,763,076 50,498,812 52,353,837 55,258,600 Business-type activities: � 1 Unrestricted investrnent eamings 1,097,155 206,665 895,064 635,454 1,346,799 1,326,787 Transfers 798,618 948,416 837,806 861,290 539,088 539,088 - Total business-type activities 1,895,773 1,155,081 1,732,870 1,496,744 1,885,887 1,865,875 Total primary govemment 48,753,064 50,234,669 51,495,946 51,995,556 54,239,724 57,124,475 � , Change in net assets Govemmental activities 4,595,432 2,287,156 4,381,297 1,683,878 4,806,075 10,413,13] Business-typeactivities 7,650,261 (127,980) 3,361,599 (1,609,572) 129,303 (835,451) Total primary govemment $ 12,245,693 $ 2,159,176 $ 7,742,896 $ 74,306 $ 4,935,378 $ 9,577,680 Only six years have been presented because 2003 was the year GASB Statement No.34 was implemented. � � Continued from previous page ' ' Ill-4 ✓ � Table 3 CITY OF BANGOR,MAINE Governmental Activities Tax Revenues By Source I.ast Ten Fiscal Years (accrual basis of accounting) Fiscal Year � 2003 2004 2005 2006 2007 2008 T�x Revenues • Properiy taxes $ 37,624;392 $ 39,936,976 $ 40,302,810 $ 40,666,758 $ 41,702,775 $ 43,775,938 Excise taxes 4,091,505 4,306,055 4,358,409 4,752,852 4,668,614 4,641,320 . 1 Franchise taxes 233,874 225,224 265,598 274,986 296,566 300,768 . � . Total tax revenues $ 41,949,771 $ 44,468,255 $ 44,926,817 $ 45,694,596 $ 46,667,955 $ 48,718,026 , � Only six years have been presented because 2003 was the year GASB Statement No.34 was implemented. , i f � III-5 Table 4 CITY OF BANGOR,MAINE Fund Balances of Governmental Fuods Last Ten Fiscal Years (modified accrual basis of accounting) Fiscal Year 1999 2000 2001 2002 2003 2004 2005 2006 2007 3008 Geoeral Fund: Reserved $ 3,388,936 $ 2,907,605 $ 2,314;524 $ 2,204,855 $ 2,692,524 $ 2,571,692 $ 2,427,099 $ 2,188,819 $ 2,366,032 $ 2,637,120 Unreserved 7,777,318 10,868,363 13,022,113 15,412,411 14,575,433 11,184,543 10,676,570 ]0,828,439 11,438,114 11,602,190 � Total general fund $ 11,166,254 $ 13,775,968 $ 15,336,637 $ 17,617,266 $ 17,267,957 $ 13,756,235 $ 13,103,669 $ 13,017,258 $ 13,804,146 $14,239,310 All other governmental funds: Reserved $ 967,921 $ 969,162 $ 1,143,738 $ 1,836,653 $ 5,229,243 $ 2,599,271 $ 2,358,441 $ 3,832,469 $ 2,015,620 $ 8,081,884 Unreserved,reported in , Special revenue funds (259,601) (315,560) (346,598) 1,029,775 2,080,184 1,997,434. 1,810,747 2,2]5,929 2,663,736 5,005,12] Capital projects funds 968,763 1,173,695 538,858 4,622,212 (488,844) 4,211,800 3,658,954 925,634_ 1,735,231 469,554 Permanent funds 555,634 _ 864,739 812,694 539,666 500,558 424,802 370,308 350,222 361,879 399,223 Total all other govemmental funds $ 2,232,717 $ 2,692,036 $ 2,148,692 $ 8,028,306 $ 7,321,141 $ 9,233,307 $ 8,198,450 $ 7,324,254 $ 6,776,466 $13,955,782 . �1_6 � � � � � �. G Table 5 � CITY OF BANGOR,MAINE Chauges in Fund Balances of Governmental Funds Last Ten Fiscal Years (modified accrual basis of accounting) Fiscal Year 2003 2004 2005 2006 2007 2008 Revenues: ' Taxes: Properly taxes $ 39,261,141 $ 39,974,952 $ 40,586,129 $ 41,101,785 $ 42,145,912 $ 43,767,914 Excise taxes 4,091,505 4,306,055 4,358,409 4,752,852 4,668,614 4,641,320 Total tax revenues 43,352,646 44,081,007 44,944,538 45,854,637 46,814,526 48,409,234 Intergovernmental 30,627,927 31,617,135 34,484,238 37,714,682 37,774,922 41,345,956 _- Licenses and permits 409,842 374,499 655,745 538,534 982,879 956,965 , Charges for services 10,151,637 . 11,035,587 12,160,573 12,927,989 12,598,776 13,283,275 Program income • 583,569 463,066 409,153 663,269 657,987 296,325 Revenue from money and property 1,420,582 1,162,796 1,255,959 2,349,812 3,621,988 3,812,356 Other 1,612,518 ]42,311' 168,452 526;360 279,261 7,691,463 _ Total revenues 88,158,721 88,876,401 94,078,658 100,575,283 ]02,730,339 115,795,574 Expenditures: General government 4,223,670 4,619;401 4,732,331 4,642,935 4,736,885 5,122,152 " Public safety I1,018,419 ]2,001,813 12,352,418 12,852,119 13,476,656 14,162,638 Health,community services and recreation 3,230,938 3,480,885 3,865,578 4,084,948 4,086,513 4,305,709 Public buildings and services 7,876,895 8,180,067 '8,301,848 8,991,673 9,363,365 9,906,759 � Other agencies 3,157,861 3,273,003 3,514,658 3,610,935 3,783,720 4,227,552 • Education 39,428,576 40,341,426 42,228,691 44,817,879 45,224,974 48,293,846 , Unciassified 327,812 389,598 65,639 ' 263,702 597,262 166,994 Restricted gants 6,510,909 6,822,298 7,282,380 8,248,872 7,787,297 9,098,706 Capital outlay* 8,794,651 ]0,675,20] 8,681,772 11,762,832 9,100,357 8,038,242 ' Debt service Principal 5,730,088 2,232,944 4,110,250 2,748,866 4,237,096 ` 2,044,428 Interest 3,299,332 3,080,468 3,120,028 3,098,248 3,095,434 2,436,120 Otherchazges 10,028 5,570 37,467 5,070 4,850 299' Total expenditures 93,609,179 95,102,674 98,293,060 ]05,128,079 ]05,494,409 107,803,445 Deficiency of revenues under expenditures (5,450,458) (6,226,273) (4,214,402) (4,552,796) (2,764,070) 7,992,129 Other financing sourccs/(uses) ' General obligation debt 4,397,511 5,443,400 2,65Q000 4,333,000 3,555,000 - Sale of assets 232,259 131,773 106,895 120,479 320;034 161,439 Transfersto otherfunds (3,663,860) (5,369,448) (3,131,050) (3,099,137) (3,300,247) (2,69Q305) Transfers from other funds 2,865,242 4,421,032 2;293,244 2,237,847 2,428,383 2,151,217 Totalotherfinancingsources 3,831,152 4,626,757 ],919,089 3,592,189 3,003,170 (377,649) Net change in fund balances $ (1,619,306) $ (1,599,516) $ (2,295,3'13) $ (960,607) $ 239,100 $ 7,614,480 Debt service as a percentage of noncapital expenditures 11.17% 6.30% 8.27% 6.08% 7.74% 4.45% Only six years have been presented because 2003 was the year GASB Statement No.34 was implemented. ' Capital outlays under the modified accrual basis differ from capital outlays on the statement of activities due to capitalization.thresholds and budgetary requi�ements. III-7 Table 6 CITY OF BANGOR,MAINE . � Assessed Value and Estimated Actual Value of Taxable Property* Last Ten Fiscal Years Real Property Total Taxable Total Fiscal � Estimated Estimated Personal Assessed Direct Year Residential Commercial Propertyl Value Taz Rate 1999 746,472,500 473,478,000 188,488,200 1,408,438,700 , 22.88 2000 782,055,600 485,097,500 208,423,500 1,4'75,576,600 22.79 2001 815,027,500 499,936,900 222,823,400 1�,537,787,800 22.54 2002 , 841,857,900 504,871,000 241,682,200 . 1,588,411,100 � 22.78 2003 896,351,100 516,447,000 278,430,400 1,691,228,500 22.52 2004 922,374,500 549,399,100 268,555,600 1,740,329,200 22.27 2005 990,170,000 618,388,000 259,687,300. 1,868,245,300 20.97 � 2006 1,091,628,800 713,822,300 254,225,800 2,059,676,900 1931. 2007 1,I78,745,758 785,599,342 259,703,500 2,224,048,600 18.33 2008 1,275,227,064 875,870,136 254,991,600 2,406,088,800 17.74 • * It is City policy to assess at]00%of estimated actual value. � • Personal Property consists of machinery and equipment � � IlI- 8 � . I Table 7 CITY OF BANGOR,MAINE � .Property Tax Rate-Direct and Overlapping Governments Last Ten Fiscal Years General General Fiscal City Fund Debt Penobscot Total Ta�r/ Year Government Service Education County (Mill)Rate 1999 9.67 1.10 12.11 0.92 . 23.80 2000 9.73 0.97 12.09 0.91 23.70 2001 9.64 1.01 11.89 091 23.45 2002 9.81 , 0.73 12.24 0.97 23.75 2003 9.51 0.74 12.27 1.08 23.60 2004 9.26 0.79 12.22 1.08 i 2335 2005 8.20 1.18 11.59 1.08 22.05 � 2006 7.97 1.14 10.20 1.09 � 20.40 2007 7.79 1.18 9.36 1.07 19.40 2008 7.69 1.18 � 8.87 1.06 18.80 , III-9 � " Table S CITY OF BANGOR,MAINE � Principal Property Taxpayers* June 30,2008 � 2008 1999 Assessed %of Total Assessed %of Total Taxpayer Business Value Rank Tax Base Value Rank Tax Base General Electric Manufacturer $ 81,913,200 1 3.40% $ 59,989,700 1 4.26°/a , BANMAK Associates Shopping mall 56,985,700 . 2 2.37% 56,167,400 2 3.99°/a Bangor Hydro Electric . Utility 31,251,400 3 1.30% 24,466,200 3 1.74% Inland Western Parkade Shopping mall 26,206,600 4 1.09% - - QV Realty Trust Real estate interests 15,602,200 5 0.65% - - Bangor Savings Bank Financial institution 15,094,000 6 0.63% - - �Bangor Gas Co LLC Utility 14,327,700 7 0.60% Eastem Maine Nealthcare Medical institution i3,464,500 8 0.56% - - May Department Stores Retailer 12,845,000 9 0.53% - - Cabrel Coinpany Real estate interests 12,636,400 ]0 0.53% 10,273,200 5 0.73% . Webber Oil Company Fuel distributor - - 12,216,455 4 0.87% Wal Mart Stores Retailer - - 9,089,848 6 0.65% Credit Suisse Leasing Leasing/finance - - 7,869,278 7 0.56% Fleet Bank of Maine Commercial bank - - - 7,072,800 8 0.50% Airport Mall Associates Shopping mall - - 7,069,600 9 0.50% Stillwater Realty Trust Real estate interests - - 6,668,400 ]0 0.47% Totals $280,326,700 11.65% $200,882,881 14.26% � ' ' Source-Ciry of Bangor Tax Commitment . . III- ]0 � Table 9 CITY OF BANGOR,MAINE Property Tax Levies and Collections Last Ten Fiscal Years %of' Outstanding Ratio of • %of Delinquent Total Total Tax Current Year Current Year Fiscal Gross Tax Abate- Net Tax Current Net Levy Tax Tax Collecfion Delinquent Delinquencies , Year Levy ments Levy Collections Collected Collections Collections to Net Levy Taxes to Net Levy ]999 32,611,689 145,123 32,466,566 31,084,751 95.74% 1,503,187 32,587,938 100.37% 1,381,815 426% 2000 34,069,975 246,152 33,823,823, 32,809,377 97.00% 719,683 33,529,060 99.13% 1,014,446 3.00% 2001 . 35,283,733 258,412 35,025,321 33,930,930 96.88% 1,565,244 35,495,174 ]01.34% 1,094,391 3.12% 2002 36,893,245 208,211 ' 36,685,034 35,G33,029 97.13% 1,655,407 37,288;436 101.64% 1,052,005 2.87"/0 � 2003 39,081,183 . 311,677 38,769,506 37,785,056 97.46% 1,506,817 39,291,873 10135% 984,450 2.54% I 2004 39,866,850 172,868 39,693,982 38,589,047 97.22% 1,154,69,3 39,743,740 100.13% 1,104,935 2.78% 2005 40,474,184 160,117 40,314,067 39,206,172 97.25% 1,310,3ll 40,516,483 100.50% 1,107,895 2.95% 2006 41,099,990 632,397 40,467,593 39,716,755 98.14% 1,327,356 41,044,111 101.42% 750,838 1.86% 2007 41,990,985 269,636 41,721,349 40,819,923 97.84% 1,271,969 42,091,892 100.89% 901,426 2.16% r � ' . , 2008 . 44,082,476 341,521 43,740,955 42,847,656 97.96% 950,349 43,798,005 ]00.13% 893,299 2.04°/a _ C m- ii � Table 10 CITY OF BANGOR,MAINE Ratios of Outstanding Debt by Type Last Ten Fiscal Years � Governmental Activities Business-Type Activities General General Total Fiscal Obligation Capital Obligation Revenue Primary ' Per Year Bonds Leases Bonds Bonds Government Capita* 1999 $ 21,254,395 352,735 41,636,421 .4,940,000 68,183,55] 2;214.97 2000 $ 21,909,832 293,503 38,018,202 4,710,000 64,931,537 2,073.76 2001 $ 22,806;350 223,910 37,931,078 4,465,000 65,426,338 2,078.81 2002 $ 59,135,992 150,353 42,386,491 4,205,000 ]05,877,836 3,351.09 2003 $ 57,669,023 326,159 47,854,061 - 105,849,243 3,355.93 2004 $ 60,879,479 3,491 47,994,390 - 108,877,360 3,450.95 2005 $ 59,419,229 - 46,774,080 - 106,193,309 •3,36].08 2006 $ � 6I,003,363 - 45,781,229 - 106,784,592 3,436.46 2007 $ 60,321,264 - 43,809,953 - . 104,131,217 3,358.20 2008 $ 56,998,023 - 41,722,544 - . 98,720,567 3,099.25 * Source:Maine Department of Human Services,Maine State Plannng Office and City of Bangor (1999 through 2000)and U.S.Census Bureau(2001 through 2008): i ' III- 12 � Table 11 � CITY OF BANGOR,MAINE Ratio of Net General Obligation Debt to Assessed Value and . Net General Obligation Debt Per Capita Last Ten Fiscal Years Ratio of Net Bonded Debt Fiscal Assessed Net Bonded To Assessed Per , Year Population* Value GO Debt** Value Capita. � 1999 30,783 1,408,438,700 27,205,258 1.93% 883.78 2000 31,311 1,475,576,600 27,713,328 1.88% 885.10 2001 31,473 1,537,787,800 30,434,229 1.98%' 966.99 � 2002 31,595 1,588,411;100 66,818,681 4.21% 2',114.85 2003 31,541 1;691,228,500 � 65,323,120 3.86% 2,071.05 I 2004 31,550 1,740,329;200 69,638,974 4.00% 2,207.26 2005 31,595 � 1,868,245,300 65,988,998 3.53% 2,088.59 2006 31,074 2,059,676,900 66,990,510 3.25% 2,155.84 2007 . � 31,008 2,224,048,600 65,725,523 2.96% 2,119.63 _ 2008 31,853 2,406,088,800 61,824,071 2.57% 1,940.92 * Source:�Maine Deparhnent of Human Services,Maine State Planning Office and City of Bangor (1999 through 2000)and U.S.Census Bureau(2001 through 2008). ** Net Bonded General Obligation Debt Consists of all non-self supporting general obligation debt,and excludes all Sewer Utility debt of$24,542,985,Airport debt of$7,512,122,Golf Course debt of$629,281 and Economic Development debt of$4,212,108. � , III - 13 Table 12 � CITY OF BANGOR,MAINE Computation of Direct and Overlapping Debt June 30,2008 � ' Percentage Amount � Total Debt Applicable Applicable Outstanding to Bangor to Bangor Direct Debt City of Bangor . General Obligation Bonds $ 98,720,567 100.00% $ 98,720,567 Overlapping Debt $ - $ - Total Debt $ 98,720,567 $ 98,720,567 � , , ' - , � , , III - 14 ' Table 13 CITY OF BANGOR,MAINE , Legal Debt Margin Information Last Ten Fiscal Years Total Net Debt Legal Percentage of Fiscal Debt . Applicable to Debt Net Debt to Year Limit Limit Margin Debt Limit 1999 $ 212,692,500 62,890,816 149,801,684 29.57% - 2000 $ 215,017,500 59,928,034 155,U89,466 27.87% 2001 $ 225,630,000 64,737,428 160,892,572 28.69% 2002 $ 240,937,500 101,522,483 139,415,017 42.14% 2003 $ 241,387,500 . 105,523,084 135.,864,416 43.72% 2004 $ 261,240,000 108,873,869 152,366',131 41.68% 2005 $ 279,202,500 106,193,307 173,009,193 38.03% 2006 $ 309,495,000 106,784,592 202,710,408 34.50% 2007 $ 332,092,500 104,131,217 227,961,283 31.36% 2008 $ 353,737,500 98,720,567 255,016,933 27.91% Legal Debt Margin Calculation for Fiscal Year 2008 Total State.Valuation $2,358,250,000 Debt Limitation: 15 %of State Valuation 353,737,500 Debt Applicable to Debt Limitation: General Obligation Bonds: Municipal 64,731,633 School 9,445,949 Sewer 24,542,985 Total debt applicable to limit . 98,720,567 Legal Debt margin $ 255,016;933 III- 15 � Table 14 � CITY OF BANGOR,MAINE Demographic and Economic Statistics Last Ten Fiscal Years Median Per Public Unemploy= Fiscal Household Capita Median School ment Year Population * Income* Income* Age* Enrollment** Rate*** 1999 30,783 Data not Data not Data not 4,410 2.99% available available available 2000 31,311 Data not Data not Data not 4,281 2.85% ' available available available 2001 31,4�3 Data not Data not Data nof 4,316 3.01% available available available 2002 31,595 � 29,740 19,295 36.1 4,205 3.12% 2003 31,541 , 29,740 19,295 36.1 4,019 3.40% 2004 31,550 29,740 19,295 36.1 4,006 4.30% 2005 , 31,595 29,740 19,295 36.1 3,989 4.50% 2006 31,074 29,740 19,295 36.1 3,962 4.40% 2007 31,008 29,740 19,295 36.1 3,91.3 4.40% 2008 31,853 29,740 19,295 36.1 3,886 5.]0% * Source: U.S.Census ** Source: Bangor School Department . *** Source: Bureau of Labor Statistics 1 III- 16 Table 15 CITY OF BANGOR,MAINE Principal Employers " June 30,2008 � 2008 1999 Employees Employer Location Employees Employer Location 1000-4999 Eastern Maine Medical Center Bangor 1000-4000 Eastern Maine Medical Center Bangor Bangor Mall Bangor Bangor Mall Bangor University of Maine Orono University of Maine O.rono City of Bangor Bangor City of Bangor Bangor � Hannaford Supermarkets Throughout United States Postal Service Old Town Cianbro Corporation Throughout 500-999 Fort James Paper Corp Old Town 500-999 Bangor Savings Bank Bangor St. Joseph Hospital , Bangor L.L.Bean Bangor Community Health/Counseling Bangor Microdyne Orono Shop& Save Supermarkets Throughout • Acadia Hospital Bangor Webber Energy Co " Bangor Hollywood Slots Bangor Wal-Mart Throughout . Verso Corp Paper Mill Bucksport St. Joseph Hospital Bangor * Source-Bangor,Maine Community&Economic Profile Report _ - Published by City of Bangor Community and Economic Development Department III- 17 ` - , � . �. - .. " . Table 16 CITY OF BANGOR,MAINE � Full-Nme Equivalent City Governmeut Employees by Funcfion - Last Ten Fiscal Years Full-time Equivaleot Employees as of June 30th 1999 2000 2001 2002 2003 2004 2005 20.06 2007 2008 Function - General government 86 90 92 93 91 90 87 88 94 85 Public safety Police ,. 81 79 85 86 89 86 87 89 90 87 Fire 98 98 97. 95 95 97 96 97 94 97 Health,community services and recreation 7'1 78 33 . 34 33 31 31 32 . 39 41 , Public building and services 66 62 63 66 68 67 64 68 71 67 Education 568 580 583 574 574 561 571 573 562 618 Sewer Utility 24 24 23 23 � 23 23 23 23 23 23 Airport 73 75 76 82 72 73 75 76 81 87 � Park Woods ' 3 3 3 3 � 3 3 . 3 3 3 3 ' Parking 3 1 1 2 2 2 2 2 � 2 2 Bass Park 9 10 10 9 9 8 9 9 9 7 Municipal Golf Course 3 3 3 3 3 3 3 3 9 3 Economic Development 2 2 2 3 2 3 3 . 3 3 3 Totals � . 1,087 1,105 1,071 1,073 1,064 1,047 1,054 1,066 1,080 1,123 t � , � - III- 18 Table 17 CITY OF BANGOR,MAINE Operating Indicators by Function . Last Ten Calendar Years - Calendar Year 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 Function- Code enforcement Building permits 565 �509 494 471 474 522 514 537 550 485 Certificatesofoccupancy 476 388 354 295 358 342 341 432 446 430 - Sign permits 126 120 129 85 ' 96 98 107 115 116 � 118 Police " Calls for service. Unavailable Unavailable Unavailable Unavailable 22,213 24,407 23,945 27,052 28,157 32,392 Fire � Calls for service Unavailable Unavailable Unavailable Unavailable 7,528 7,470 7,805 7,492 7,992 7,477 Sewer Treated flow(billions of gallons) 2.95 3A2 3.04 2.63 3.14 3.42 2.75 4.23 3.62 3.21 Biosolids(cubicyazds) 9,184 8,519 8,272 8,683 8,308 , 9,379 9,280 9,348 9,775 10,043 . � - . l " III-19 ` Table 18 CITY OF BANGOR,MAINE Capital Asset Statistics by Function � Last Ten Fiscal Years � Fiscal�Year 2003 2004 2005 2006 2007 2008 Function Public safety � Police: Stations ' 1 1 1 1 � 1 1 Vehicles 42 56 57 51 52 47 � Fire: Stations• 3 3 - 3 3 3 . 3 Vehicles ' 25 20 20 24 27 . 28 Public works . . Streets(miles) 422 422 422 422 422 427 Sidewalks(miles) 99.6 99.6 99.6 99.6 99.6 99.6 Parks and recreation _ Parks 29 29 29 29 29 29 � Parksacreage 950 950 950 950 950 950 Public swimming pools • 1 2 2 2 2 2 Public golf courses 1.5 1.5 1.5 1.5 1.5 1.5 Indoor ice azena 1 1 1 1 I 1 Semi-pro baseball stadium 1 ] 1 1 1 1 Sewer Treatment plants 1 1 1 1 1 1 Pump stations 5 5 5 5 5 5 Miles of sanitary sewers 103 103 103 103 103 103 , Miles of combined sewers 44 44 44 44 44 44 Only six years have been presented because 2003 was the year GASB Statement No.34 was implemented. , III-20 • �