CITY OF SONOMA
CALIFORNIA
ANNUAL FINANCIAL REPORT
FOR THE FISCAL YEAR ENDED
JUNE 30, 2006
City Council
Doug McKesson Mayor
Stanley Cohen Mayor Pro- Tem
Larry Barnett Member
Ken Brown Member
Joanne Sanders Member
Appointed Officials
City Manager
Michael Fuson
Assistant City Manager
Carol E. Giovanatto
CITY OF SONOMA, CALIFORNIA
ANNUAL FINANCIAL REPORT
FOR THE FISCAL YEAR ENDED JUNE 30, 2006
TABLE OF CONTENTS
TITLE PAGE
INTRODUCTORY SECTION:
Table of Contents ............................................................................................................................... ........ i
FINANCIAL SECTION:
Independent Auditor’s Report.................................................................................................................... 1 - 2
Management’s Discussion and Analysis ................................................................................................... 3 - 10
Basic Financial Statements:
Government- Wide Financial Statements:
Statement of Net Assets ............................................................................................................... 11
Statement of Activities ................................................................................................................. 12
Fund Financial Statements:
Governmental Funds:
Balance Sheet ........................................................................................................................... 13
Reconciliation of the Governmental Funds Balance Sheet to the
Statement of Net Assets........................................................................................................ 14
Statement of Revenues, Expenditures, and Changes
in Fund Balances................................................................................................................... 15
Reconciliation of Governmental Funds Statement of Revenues, Expenditures,
and Changes in Fund Balances to the Statement of Activities.............................................. 16
Proprietary Funds:
Statement of Net Assets............................................................................................................ 17
Statement of Revenue, Expenses and Changes in Net Assets .................................................. 18
Statement of Cash Flows .......................................................................................................... 19
Agency Funds:
Statement of Fiduciary Net Assets ........................................................................................... 20
Notes to the Basic Financial Statements .............................................................................................. 21 - 44
REQUIRED SUPPLEMENTARY INFORMATION:
Major Governmental Fund Schedules:
General Fund Schedule of
Revenue, Expenditures and Changes in Fund Balances – Budget and Actual ............................. 45
Community Development Agency Low/ Moderate Income Housing Fund Schedule of
Revenue, Expenditures and Changes in Fund Balances – Budget and Actual ............................. 46
SUPPLEMENTARY INFORMATION:
Nonmajor Governmental Funds:
Combining Balance Sheets .................................................................................................................. 47 - 52
Combining Schedule of Revenues, Expenditures and Changes in
Fund Balances .............................................................................................................................. 53 - 58
Internal Service Funds:
Combining Schedule of Net Assets ..................................................................................................... 59
Combining Schedule of Revenue, Expenses and Changes in Net Assets ............................................ 60
Combining Schedule of Cash Flows.................................................................................................... 61
CITY OF SONOMA, CALIFORNIA
ANNUAL FINANCIAL REPORT
FOR THE FISCAL YEAR ENDED JUNE 30, 2006
TABLE OF CONTENTS
Agency Funds:
Combining Schedule of Fiduciary Net Assets ..................................................................................... 62
OTHER INDEPENDENT AUDITOR’S REPORTS:
Report on Internal Control Over Financial Reporting and on Compliance and Other
Matters Based on an Audit of Financial Statements Performed in Accordance with
Government Auditing Standards.......................................................................................................... 63
Management’s Discussion and Analysis
3
Management’s Discussion and Analysis
Fiscal Year 2005- 06
CITY OF SONOMA
Each year, the City is required to present a Management’s Discussion and Analysis
[ MD& A] with the annual financial report in accordance with Governmental Accounting
Standards Board [ GASB] rule 34. MD& A is intended to introduce the City’s financial
statements to users and help assess whether the City’s overall financial health has
improved or deteriorated as a result of the past year’s operations.
OVERVIEW OF THE ANNUAL FINANCIAL REPORT
The annual report is presented in a series of financial statements. The components are:
􀂃 The government- wide financial statements which include the Statement of Net
Assets and the Statement of Activities. These statements provide information about
the activities of the City as a whole.
􀂃 Fund financial statements describe how City services are financed in the short term
as well as what resources are available for future spending. Fund financial
statements also report the City’s operations in more detail than the government- wide
statements by providing information about the City’s most significant funds.
􀂃 Notes to the Financial Statements.
Reporting the City as a Whole
The Statement of Net Assets and the Statement of Activities [ Government Wide]
A frequently asked question regarding the City’s financial health is whether the year’s
activities contributed positively to the overall financial well- being. The Statement of Net
Assets and the Statement of Activities report information about the City as a whole that
helps answer this question. These statements include all assets and liabilities using the
accrual basis of accounting, which is similar to the accounting used by most private
sector companies. All of the current year’s revenues and expenses are accounted for
regardless of when cash is received or paid.
These two statements report the City’s net assets and changes thereto. Net assets, the
difference between assets and liabilities, are one way to measure the City’s financial
health, or financial position. Over time, increases or decreases in net assets are an
indicator of whether the financial health is improving or deteriorating. It is also important
to consider other non- financial factors such as changes in the City’s property tax base
4
or condition of City infrastructure assets to accurately assess the overall health of the
City.
The Statement of Net Assets and the Statement of Activities present information about the
following:
Governmental Activities - All of the City’s basic services are considered to be governmental
functions, including City Council, City Manager, City Attorney, City Clerk, Administrative
Services, Public Works, Planning and Community Development, Police, Fire, Community
Services, and General Services. These departments are supported by general City revenues
such as taxes, and by specific program revenues such as fees.
Business- type Activities - The City’s enterprise activities are reported here for Water and
Cemetery Funds. Unlike governmental services, these services are supported by charges paid
by users based on the amount of service they receive.
Component Unit - The City’s governmental activities include the blending of one separate legal
entity, the Sonoma Community Development Agency. Although legally separate, this
“ component unit” is important because the City is financially accountable for it.
Reporting the City’s Most Significant Funds - Fund Financial Statements
The fund financial statements provide detailed information about the most significant funds – not
the City as a whole. Some funds are required to be established by State law or by bond
covenants. However, management establishes many other funds that aid in the administration
of resources for particular purposes or meet legal responsibilities associated with the usage of
certain taxes, grants, and other money. The City’s two kinds of funds, governmental and
proprietary, use different accounting approaches as explained below.
Fund Financial Statements include Governmental and Proprietary Funds.
Governmental funds – Most of the City’s basic services are reported in governmental funds.
Governmental funds focus on how resources flow in and out with the balances remaining at
year end that are available for spending. These funds are reported using an accounting method
called modified accrual, which measures cash and all other financial assets that can readily be
converted to cash. The governmental fund statements provide a detailed short term view of the
City’s general government operations and the basic services it provides. Governmental fund
information shows whether there are more or fewer financial resources that can be spent in the
near future to finance the City’s programs. We describe the relationship ( or differences)
between governmental activities ( reported in the Statement of Net Assets and the Statement of
Activities) and governmental funds through a reconciliation statement.
Business Type ( Proprietary) funds – When the City charges customers for the services it
provides, these services are generally reported in proprietary funds. Proprietary funds are
reported in the same way that all activities are reported in the Statement of Net Assets and the
Statement of Activities.
This section, Management’s Discussion & Analysis ( MD& A) presents a narrative overview and
analysis of the financial activities of the City for the fiscal year ended June 30, 2006. Please
read this section in conjunction with the accompanying basic financial statements.
5
FINANCIAL HIGHLIGHTS
􀂃 The City’s total net assets at June 30, 2006 were $ 45,669,415, an increase of $ 7.9
million over the prior year.
􀂃 Total City revenues, including program and general revenues, were $ 25,385,423, an
increase of $ 5,285,185 from the prior year. Total expenses were $ 17,539,157, a
decrease of $ 752,543 million from the prior year.
􀂃 Governmental Activities Program Revenues were $ 2,798,548, an increase of
$ 1,344,812 from fiscal 2005’ s $ 1,453,736. Charges for services revenue accounted
for over $ 613,000 of the increase from the prior year while operating grants and
contributions revenue increased over $ 230,000. Capital grants accounted for over
$ 500,000 for the balance of the increase.
􀂃 Governmental Activities Program Expenses were $ 11,709,820 in fiscal 2006, a
decrease of $ 757,091 from 2005’ s $ 12,466,911.
􀂃 Program revenues from Business- Type Activities were $ 6,234,817 in fiscal year
2006, a decrease of $ 183,567 from the prior year. Business– type activities revenue
is comprised of charges for services which decreased $ 1,128,325 offset by capital
grants and contributions which increased $ 944,758.
􀂃 General Fund revenues and net other financing sources were $ 11,666,737, an
increase of $ 3,056,768 over the prior year. The major source for the increase was
the gain on the sale of property [ Patton Street Fire Station to the Redevelopment
Agency].
􀂃 General Fund total expenditures were $ 9,153,052, an increase of $ 358,475 from
prior year amounts.
􀂃 General fund balance was $ 7,791,785 at fiscal year end compared favorably with
the budgeted fund balance and the prior year’s actual fund balance of $ 5,278,300.
The fund balance is 58% of total General Fund expenditures ( excluding other
financing uses).
6
Citywide Financial Statements – Governmental Activities
The following analysis focuses on the net assets and changes in net assets of the City’s
Governmental Activities, presented in the Citywide Statement of Net Assets and
Statement of Activities.
2006
2005
Current and other assets 35,449,585 34,835,174
Capital Assets 33,268,125 27,678,546
Total Assets 68,717,710 62,513,720
Long- term debt outstanding 34,017,095 34,095,897
Other Liabilities 1,545,341 2,027,275
Total Liabilities 35,562,436 36,123,172
Net assets:
Invested in capital assets, net of related debt ( 567,040)
Restricted for Debt Service 332,108 579,762
Restricted for LMI 6,467,794 6,115,228
Unrestricted 26,922,412 19,695,558
Total Net Assets 33,155,274 26,390,548
Total Net Assets for governmental activities increased approximately $ 6.8 million in FY 2006 as
compared to FY 2005. The major portion of the increase, approximately $ 5.6 million, is the result
of additional construction projects and recording of infrastructure as a result of the GASB 34
capital asset audit.
7
Governmental Activities – Revenues
REVENUES
Revenues by Source 2006 %
Program revenues:
Charges for Services 1,652,504 60%
Operating contributions & grants 528,348 18%
Capital contributions & grants 617,696 22%
Total Program Revenues 2,798,548
General revenues
Taxes and Assessments 12,314,118 91%
Use of money and property 769,141 6%
Other 411,474 3%
Total General Revenues 13,494,733
Transfers ( 596,903)
Special Item: Gain on Sale of Property 2,751,133
Total Revenues, Transfers & Special 18,447,512
The table above shows that all Governmental Activity revenues totaled $ 18,447,512,
million in 2005- 06. ( I recommend a comparison to prior year here)
Program revenues include charges for service, operating grants and contributions, and
capital grants and contributions generated from or restricted to each activity.
General revenues are composed of taxes and other revenues not specifically generated
by or restricted to individual activities. All tax revenues, investment earnings, and rents
for governmental facilities are included in general revenues.
8
Governmental Activities – Expenses
The table below presents the expenses and net revenue/( expense) for each of the City’s
Governmental Activities and interest on long- term debt. Net cost is defined as total
program cost less the revenues generated by those specific activities.
EXPENSES & NET CHANGE
Governmental Activities
Department
Functions/
Expenses
Program
Revenue
Revenue/
( Expenses)
General Government 1,459,632 143,055 [ 1,316,577]
Public Safety 4,725,535 439,743 [ 4,285,792]
Public Works 1,637,372 1,495,010 [ 142,362]
Community Development 2,084,134 676,733 [ 1,407,401]
Culture and Leisure 308,125 44,007 [ 264,118]
Interest on Long- term debt 1,495,022 0 [ 1,495,022]
Total Net Cost 11,709,820 2,798,548 [ 8,911,272]
The table above presents the net cost of each of the City’s Governmental Activity.
During the year, net cost is defined as total program cost less the revenues generated
by those specific activities. Total Governmental Activity expenses totaled $ 11,709,820
million in 2005- 06. In 2004- 05, the City’s expenses for governmental activities totaled
$ 12,466,911.
Citywide Financial Statements – Business- type Activities
The following analysis focuses on the net assets and changes in net assets of the City’s
Business- type Activities, presented in the Citywide Statement of Net Assets and
Statement of Activities. Business- type activities include Cemetery, Water and EMS, as
the Enterprise funds of the City.
Business- type Activities
Net Assets at June 30, 2006
2006
2005
Increase/( Decrease)
from FY 04- 05
Cash and other assets 4,949,974 3,659,940 1,290,034
Capital assets 11,106,312 11,389,294 ( 282,982)
Total Assets 16,065,286 15,049,234 1,016,052
Long- term debt outstanding 3,101,817 3,082,277 19,540
Other Liabilities 499,328 561,389 62,061
Total Liabilities 3,551,145 3,643,666 [ 95,521]
Total Net Assets: 12,514,141 11,405,568 1,108,573
Invested in capital assets, net of debt 8,108,981 9,151,556 [ 1,042,575]
Restricted 798,011 301,066 496,945
Unrestricted 3,607,149 1,952,946 1,654,203
Total Net Assets 12,514,141 11,405,568 1,108,573
9
The City’s Business- type net assets increased $ 1.1 million to $ 12.5 million in 2005- 06,
from $ 11.4 million in 2004- 05.
♦ Cash and investments in FY05- 06 were higher by $ 1.2 million in comparison to
prior year
♦ Net assets invested in capital assets, net of related debt, decreased $ 282,982.
♦ Unrestricted net assets of $ 3.6 million represent liquid assets available to
finance day- to- day operations and other expenditures approved by City
Council.
( There should be a table or discussion of the business- type activities revenues, expenses and a
comparison to prior year here. Due to time constraints, maybe this should be added for 2007.)
FUND FINANCIAL STATEMENTS
Performance of Governmental Funds
At June 30, 2006, the City’s Governmental Funds reported combined fund balances of
$ 28.8 million, an increase of $ 600,000 as compared with last year.
Governmental Fund revenues increased $ 5.1 million this fiscal year to a total of $ 19.1
million as compared to $ 14 million. This is primarily attributed to increased tax revenue,
increased licenses and permits, and sale of property.
Governmental Fund expenditures decreased approximately $ 518,000 this year to $ 18.8
million.
General Fund – The General Fund ended the year with $ 7.8 million fund balance,
compared to $ 5.3 in the prior year. The City’s financial performance remained solid in
2005- 06. Expenditures were higher than in the prior fiscal year, $ 9.1 million in 05- 06 as
compared to $ 8.8 in 04- 05. Sale of the Patton Street Fire Station to the Redevelopment
Agency contributed greatly to the increase in fund balance.
Sales tax, Transient Occupancy Tax and other miscellaneous taxes, increased by
approximately $ 1.1 million as compared to the prior year. Property taxes, sales tax and
transient occupancy taxes reflected a healthy gain.
The Council has designated ( set- aside) approximately $ 1.6 million of the fund balance in
the General Fund as business continuance for City services in the event of a major
disaster or emergency, an additional $ 1.5 million as operating reserve and the balance
as reserve for special projects.
Low/ Moderate Income ( LMI) Housing Fund – The Low/ Moderate Income Housing
Fund ended the year with a $ 6.2 million fund balance, compared to $ 6.1 million in the
prior year. LMI revenues, including transfers in, totaled $ 1.2 million, which is
predominately derived directly from the 20% tax increment set- aside and investment
income. Low/ Moderate Housing expenditures, including transfers out, were $ 1.2 million
in 2005- 06.
10
Community Development Agency ( CDA) Capital Projects Fund – The CDA Projects
Fund ended the year with a $ 12.4 million fund balance, compared to $ 15.1 million in the
prior year. Revenues and transfers of $ 4.3 million are derived directly from the tax
increment. CDA Capital Projects Fund expenditures and transfers were $ 6.9 million in
2005- 06. Several significant construction projects were undertaken as a result of the
2003 bond proceeds.
Other Governmental/ Non- major Funds – These funds are not presented separately in
the Basic Financial Statements, but are individually presented as Supplemental
Information. Total combined ending Fund Balance is $ 2.4 million as compared to $ 1.9
million in the prior year.
PERFORMANCE OF PROPRIETARY [ ENTERPRISE & INTERNAL
SERVICE] FUNDS
At June 30, 2006, the City’s Proprietary Funds reported combined net assets of $ 12.5
million, as compared to combined net assets in FY 04- 05 of 15.6.
Water Fund – The Water Fund ended the year with $ 11.7 million net assets on June 30,
2006 as compared to 2004- 05, which ended the year with a $ 10.5 million balance. The
Water Fund posted a combined income of $ 4.3 million, compared to $ 4.8 in the prior
year. Expenditures for 2005- 06 totaled $ 3.6 in comparison with 2004- 05 expenditures of
$ 4.6 million.
Cemetery Fund – The Cemetery Fund ended the year with $ 1.0 million net assets on
June 30, 2006 as compared to 2004- 05, which ended the year with a $ 1 million balance.
Revenues were lower in 2005- 06 by $ 125,000 from 2004- 05 fiscal year, which posted
$ 415,676 as compared to $ 516,739 in 2004- 05. Operating expenditures were lower in
2005- 06 totaling $ 439,941 in comparison with 2004- 05 expenditures of $ 577,690.
CONTACTING THE CITY’S FINANCIAL MANAGEMENT
This financial report is designed to provide our citizens, taxpayers, customers, and public
officials with a general overview of the City’s finances and to show the City’s
accountability for the money it receives. If you have questions about this report, separate
reports of the City’s component units or need any additional financial information,
contact the Carol E. Giovanatto, Assistant City Manager at City Hall, No. 1 the Plaza,
Sonoma, California, 95476.
Basic Financial Statements
Governmental Business- type
Activities Activities Total
ASSETS
Cash and investments $ 30,583,428 $ 3,529,386 $ 34,112,814
Cash and investments - restricted 332,108 798,011 1,130,119
Accounts receivable - net 1,356,771 955,505 2,312,276
Interest receivable 222,959 30,330 253,289
Deposits & other assets 103,643 16,865 120,508
Notes receivable 1,190,735 - 1,190,735
Internal balances 499,209 ( 499,209) -
Deferred charges - net 1,160,732 128,086 1,288,818
Capital assets:
Nondepreciable 17,332,596 1,050,204 18,382,800
Depreciable, net of accumulated depreciation 15,935,529 10,056,108 25,991,637
Total Assets $ 68,717,710 $ 16,065,286 $ 84,782,996
LIABILITIES
Accounts payable $ 431,192 $ 270,842 $ 702,034
Accrued expenses 738,503 - 738,503
Accrued interest 120,000 - 120,000
Deposits payable & other 202,444 178,486 380,930
Deferred revenue 53,202 - 53,202
Long- term liabilities:
Due within one year 790,948 170,177 961,125
Due in more than one year 33,226,147 2,931,640 36,157,787
Total Liabilities $ 35,562,436 $ 3,551,145 $ 39,113,581
NET ASSETS
Invested in capital assets, net of related debt $ ( 567,040) $ 8,108,981 $ 7,541,941
Restricted for debt service 332,108 142,827 474,935
Restricted for capital projects - 655,184 655,184
Restricted for low/ moderate income housing 6,467,794 - 6,467,794
Unrestricted 26,922,412 3,607,149 30,529,561
Total Net Assets $ 33,155,274 $ 12,514,141 $ 45,669,415
CITY OF SONOMA
STATEMENT OF NET ASSETS
JUNE 30, 2006
The notes to the financial statements are an integral part of this statement
11
Operating Capital
Charges for Grants and Grants and Governmental Business- type
Functions/ Programs Expenses Services Contributions Contributions Activities Activities Total
Governmental Activities:
General government $ 1,459,632 $ 138,806 $ 4,249 $ - $ ( 1,316,577) $ - $ ( 1,316,577)
Public safety 4,725,535 143,842 295,901 - ( 4,285,792) - ( 4,285,792)
Public works 1,637,372 719,938 228,198 546,874 ( 142,362) - ( 142,362)
Community development 2,084,134 605,911 - 70,822 ( 1,407,401) - ( 1,407,401)
Culture and leisure 308,125 44,007 - - ( 264,118) - ( 264,118)
Interest on long- term debt 1,495,022 - - - ( 1,495,022) - ( 1,495,022)
Total Governmental Activities 11,709,820 1,652,504 528,348 617,696 ( 8,911,272) - ( 8,911,272)
Business- type Activities:
Water 3,204,235 3,338,921 - 944,758 - 1,079,444 1,079,444
Cemetery 405,035 258,030 - - - ( 147,005) ( 147,005)
Emergencey medical services 2,085,652 1,693,108 - - - ( 392,544) ( 392,544)
Interest on long- term debt 134,415 - - - - ( 134,415) ( 134,415)
Total Business- type Activities 5,829,337 5,290,059 - 944,758 - 405,480 405,480
Total $ 17,539,157 $ 6,942,563 $ 528,348 $ 1,562,454 $ ( 8,911,272) 405,480 ( 8,505,792)
General Revenues:
Taxes:
Property taxes 5,915,780 - 5,915,780
Franchise taxes 330,677 - 330,677
Sales and use taxes 2,411,245 - 2,411,245
Transient occupancy taxes 2,310,917 - 2,310,917
Business license tax 324,593 - 324,593
Real property transfer taxes 149,713 - 149,713
Other taxes - - -
Motor vehicle in lieu taxes 871,193 - 871,193
Investment earnings 769,141 109,021 878,162
Transfers ( 596,903) 596,903 -
Special item: gain on sale of property 2,751,133 - 2,751,133
Miscellaneous 383,710 ( 2,830) 380,880
Total General Revenues, Transfers and Special Items 15,621,199 703,094 16,324,293
Change in Net Assets 6,709,927 1,108,574 7,818,501
Net Assets - Beginning 26,390,548 11,405,567 37,796,115
Prior Period Adjustments 54,799 - 54,799
Net Assets - Beginning as Restated 26,445,347 11,405,567 37,850,914
Net Assets - Ending $ 33,155,274 $ 12,514,141 $ 45,669,415
Program Revenues Changes in Net Assets
Net ( Expenses) Revenue and
STATEMENT OF ACTIVITIES
FOR THE YEAR ENDED JUNE 30, 2006
The notes to the financial statements are an integral part of this statement
1
Community
Development Community
Agency Development Other
Low/ Moderate Agency Nonmajor Total
Income/ Housing Capital Projects Governmental Governmental
General Fund Fund Funds Funds
ASSETS
Cash and investments $ 6,586,651 $ 6,074,146 $ 12,429,600 $ 2,528,992 $ 2 7,619,389
Cash and investments - restricted - - - 332,108 3 32,108
Accounts receivable - net 919,123 4 0,729 2 14,444 173,307 1 ,347,603
Interest receivable 58,697 4 6,423 9 7,221 20,558 2 22,899
Due from other funds 684,281 - - - 6 84,281
Advances to other funds 18,991 - - - 18,991
Deposits & other assets 50,084 - - 4,397 54,481
Notes receivable 41,166 1 ,125,837 2 3,732 - 1 ,190,735
Total Assets $ 8,358,993 $ 7,287,135 $ 12,764,997 $ 3,059,362 $ 31,470,487
LIABILITIES AND FUND BALANCES
Liabilities:
Accounts payable $ - $ - $ 1 00,222 $ 260,393 $ 3 60,615
Accrued expenses 505,450 7 ,392 2 25,661 - 7 38,503
Due to other funds - - - 204,063 2 04,063
Deposits payable & other 8,356 - 3 ,750 190,338 2 02,444
Deferred revenue 53,202 1 ,125,837 2 3,732 - 1 ,202,771
Total Liabilities 567,008 1 ,133,229 3 53,365 654,794 2 ,708,396
Fund Balances:
Reserved for:
Notes receivable 41,166 - - - 41,166
Debt service - - - 802,776 8 02,776
Capital projects - - 1 2,411,632 - 1 2,411,632
Low/ Moderate income housing - 6 ,153,906 - 313,888 6 ,467,794
Operating reserve 1,500,000 - - - 1 ,500,000
Unreserved designated for:
Emergency services 1,567,975 - - - 1 ,567,975
Unreserved and undesignated:
General fund 4,682,844 - - - 4 ,682,844
Special revenue funds - - - 826,747 8 26,747
Capital projects funds - - - 498,990 4 98,990
Debt service funds - - - ( 37,833) ( 37,833)
Total Fund Balances 7,791,985 6 ,153,906 1 2,411,632 2,404,568 2 8,762,091
Total Liabilities and Fund Balances $ 8,358,993 $ 7,287,135 $ 12,764,997 $ 3,059,362 $ 31,470,487
JUNE 30, 2006
CITY OF SONOMA
GOVERNMENTAL FUNDS
BALANCE SHEET
The notes to the financial statements are an integral part of this statement
13
Fund Balance - Total Governmental Funds $ 28,762,091
Amounts reported for Governmental Activities in the Statement of Net Assets are
different from those reported in the Governmental Funds because of the following:
Capital assets used in Governmental Activities are not financial resources and,
therefore, are not reported in the Governmental Funds.
Capital assets $ 41,356,051
Less: accumulated depreciation ( 8,087,926) 3 3,268,125
Deferred charges represent costs associated with the issuance of long- term debt which
are deferred and amortized over the period during which the debt is outstanding. The
costs are reported as expenditures of current financial resources in governmental funds.
Deferred charges $ 1,385,031
Less: accumulated amortization ( 224,299) 1 ,160,732
Long- term liabilities, including bonds payable, are not due and payable in the current
period and, therefore, are not reported in the Governmental Funds.
Capital leases payable $ 858,105
Notes payable 2,994,629
Tax allocation bonds payable 29,980,000
Compensated absences 181,930 ( 34,014,664)
Interest payable on long- term debt does not require the use of current financial
resources and, therefore, are not reported in the Governmental Funds Balance Sheet. ( 120,000)
Internal service funds are used by management to charge the cost of management of
2,949,421
In governmental funds, notes receivables are not available to pay for current
period expenditures and, therefore, are offset by deferred revenue. 1,149,569
Net Assets - Governmental Activities $ 33,155,274
certain activities, such as insurance, central services and maintenance to individual governmental
funds. The net current assets of the internal service funds are therefore included as Governmental
Activities in the Statement of Net Assets.
CITY OF SONOMA
RECONCILIATION OF THE GOVERNMENTAL FUNDS BALANCE SHEET TO
THE GOVERNMENT- WIDE STATEMENT OF NET ASSETS - GOVERNMENTAL ACTIVITIES
JUNE 30, 2006
The notes to the financial statements are an integral part of this statement
14
Community
Development Community
Agency Development Other
Low/ Moderate Agency Nonmajor Total
Income/ Housing Capital Projects Governmental Governmental
General Fund Fund Funds Funds
REVENUES
Taxes $ 7 ,558,023 $ 973,522 $ 3,564,553 $ 1 00,581 $ 1 2,196,679
Fines and penalties 5 5,377 - - - 5 5,377
Intergovernmental revenues 1 51,946 - 89,498 4 45,637 6 87,081
Charges for services 6 8,261 - - 1 4,607 8 2,868
License, permits and fees 6 24,695 - - 7 10,777 1 ,335,472
Investment earnings 1 57,363 137,905 366,691 1 07,182 7 69,141
Rental income 9 8,326 - 18,900 5 92,689 7 09,915
Sale of property 2 ,811,492 - - - 2 ,811,492
Other revenue 7 6,521 86,238 251,921 4 5,687 4 60,367
Total Revenues 1 1,602,004 1,197,665 4,291,563 2 ,017,160 1 9,108,392
EXPENDITURES
Current:
General government 1 ,062,919 - - 2 2,430 1 ,085,349
Public safety 4 ,402,206 - - 8 1,501 4 ,483,707
Public works 1 ,528,895 - - 1 ,125 1 ,530,020
Community development - 83,933 664,615 3 20,839 1 ,069,387
Culture and leisure 3 08,125 - - - 3 08,125
Capital outlay 1 ,823,530 590,527 4,687,648 9 17,067 8 ,018,772
Debt service:
Principal 2 5,771 - - 8 08,623 8 34,394
Interest & fees 1 ,606 - - 1 ,488,161 1 ,489,767
Total Expenditures 9 ,153,052 674,460 5,352,263 3 ,639,746 1 8,819,521
EXCESS ( DEFICIENCY) OF REVENUES
OVER EXPENDITURES 2 ,448,952 523,205 ( 1,060,700) ( 1,622,586) 2 88,871
OTHER FINANCING SOURCES ( USES)
Transfers in 7 18,113 50,000 - 2 ,294,977 3 ,063,090
Transfers ( out) ( 653,380) ( 534,527) ( 1,624,021) ( 178,303) ( 2,990,231)
Total Other Financing Sources ( Uses) 6 4,733 ( 484,527) ( 1,624,021) 2 ,116,674 7 2,859
NET CHANGES IN FUND BALANCES 2 ,513,685 38,678 ( 2,684,721) 4 94,088 3 61,730
FUND BALANCES - BEGINNING 5 ,278,300 6,115,228 15,096,353 1 ,781,604 2 8,271,485
PRIOR PERIOD ADJUSTMENTS - - - 1 28,876 1 28,876
FUND BALANCES - BEGINNING AS RESTATED 5 ,278,300 6,115,228 15,096,353 1 ,910,480 2 8,400,361
FUND BALANCES - ENDING $ 7 ,791,985 $ 6,153,906 $ 12,411,632 $ 2 ,404,568 $ 2 8,762,091
FOR THE YEAR ENDED JUNE 30, 2006
CITY OF SONOMA
GOVERNMENTAL FUNDS
STATEMENT OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCES
The notes to the financial statements are an integral part of this statement
15
Net Change in Fund Balances - Total Governmental Funds $ 361,730
Amounts reported for Governmental Activities in the Statement of Activities are
different because of the following:
Repayment of loans $ ( 31,384)
Forgiveness of loans - ( 31,384)
Governmental funds report capital outlays as expenditures. However, in the Statement of
Expenditures for capital asset additions $ 6,185,386
Current year depreciation ( 553,408) 5,631,978
Debt proceeds provide current financial resources to governmental funds, but issuing debt
increases long- term liabilities in the Statement of Net Assets. Repayment
of debt principal is an expenditure in the governmental funds, but the repayment
reduces long- term liabilities in the Statement of Net Assets.
Repayment of capital lease obligations $ 100,771
Repayment of notes payable 118,623
Repayment of tax allocation bonds 6 15,000 834,394
The amounts below included in the Statement of Activities do not require the use
Accrued interest payable $ ( 5,255)
Compensated absences 1 4,564 9,309
Governmental funds do not report gains and losses on disposal of capital assets. However, in the government-wide
Statement of Activities, the cost of dispose of capital assets net any proceeds
is accounted for as a special item. ( 60,359)
Internal service funds are used by management to charge the costs of certain activities to
individual funds. The net revenue of the internal service fund is reported with governmental activities. ( 35,741)
Change in Net Assets - Governmental Activities $ 6,709,927
Activities the cost of those assets is capitalized and allocated over their estimated useful lives
and reported as depreciation expense.
of current financial resources and therefore is not reported as revenue or expenditures in
governmental funds ( net change):
CITY OF SONOMA
RECONCILIATION OF THE STATEMENT OF REVENUES, EXPENDITURES,
AND CHANGES IN FUND BALANCES TO
THE GOVERNMENT- WIDE STATEMENT OF ACTIVITIES - GOVERNMENTAL ACTIVITIES
JUNE 30, 2006
Repayment of long- term receivables is treated as revenue in governmental funds, but the repayment reduces
long- term receivables in the statement of net assets. Issuance of long- term receivables is treated as expenditures in
governmental funds, but the issuance increases long- term receivables in the Statement of Net Assets. Write off of
long- term receivables are recorded as reductions in long- term receivables and deferred revenue in the governmental
funds, but are recorded as expenses in the Statement of Activities.
The notes to the financial statements are an integral part of this statement
16
Governmental
Emergency Activities
Water Medical Services Cemetery Internal Service
Fund Fund Fund Totals Funds
ASSETS
Current Assets:
Cash and investments $ 3,106,795 $ - $ 422,591 $ 3,529,386 $ 2,964,039
Cash and investments - restricted 307,415 - 490,596 798,011 -
Accounts receivable - net 738,513 2 16,992 - 955,505 9,168
Interest receivable 23,457 1 ,976 4,897 30,330 60
Deposits & other assets - 1 6,865 - 16,865 49,162
Total current assets 4,176,180 2 35,833 918,084 5,330,097 3,022,429
Noncurrent Assets:
Deferred charges - net of amortization 128,086 - - 128,086 -
Capital Assets:
Nondepreciable 827,425 - 222,779 1,050,204 -
Depreciable, net of accumulated depreciation 8,926,407 1 97,876 931,825 10,056,108 -
Total noncurrent assets 9,881,918 1 97,876 1,154,604 11,234,398 -
Total Assets $ 14,058,098 $ 433,709 $ 2,072,688 $ 16,564,495 $ 3,022,429
LIABILITIES
Current Liabilities:
Accounts payable $ 208,817 $ 5 6,468 $ 5,557 $ 270,842 $ 70,577
Due to other funds - 4 80,218 - 480,218 -
Advances from other funds - - 18,991 18,991 -
Deposits & other liabilities 42,122 - 136,364 178,486 -
Total current liabilities 250,939 5 36,686 160,912 948,537 70,577
Noncurrent liabilities:
Due within one year 45,000 4 2,142 83,035 170,177 -
Due in more than one year 2,065,764 5 4,845 811,031 2,931,640 2,431
Total noncurrent liabilities 2,110,764 9 6,987 894,066 3,101,817 2,431
Total Liabilities $ 2,361,703 $ 633,673 $ 1,054,978 $ 4,050,354 $ 73,008
NET ASSETS
Invested in capital assets, net of related debt 7,678,832 $ 1 00,889 $ 260,538 8,040,259 $ -
Restricted for capital projects 164,588 - 490,596 655,184 -
Restricted for debt service 142,827 - - 142,827 -
Unrestricted 3,710,148 ( 300,853) 266,576 3,675,871 2,949,421
Total Net Assets $ 11,696,395 $ ( 199,964) $ 1,017,710 $ 12,514,141 $ 2,949,421
CITY OF SONOMA
PROPRIETARY FUNDS
STATEMENT OF NET ASSETS
JUNE 30, 2006
The notes to the financial statements are an integral part of this statement
17
Governmental
Emergency Activities
Water Medical Services Cemetery Internal Service
Fund Fund Fund Totals Funds
OPERATING REVENUES
Sales and services $ 3,323,132 $ 1,604,999 $ 2 22,467 $ 5,150,598 $ 3,372,210
Miscellaneous 15,789 88,109 3 5,563 1 39,461 71,200
Total Operating Revenues 3,338,921 1,693,108 2 58,030 5,290,059 3,443,410
OPERATING EXPENSES
Salaries and benefits 1,114,400 1,090,115 2 84,159 2,488,674 2,005,662
Services, supplies and maintenance 1,286,894 232,617 7 3,464 1,592,975 165,067
Insurance premiums and claims - - - - 239,912
Bad debt expense and write downs - 763,504 - 7 63,504 -
Miscellaneous 476,759 194,458 3 0,725 7 01,942 25,405
Depreciation & amortization 419,893 50,110 5 1,593 5 21,596 -
Total Operating Expenses 3,297,946 2,330,804 4 39,941 6,068,691 2,436,046
OPERATING INCOME ( LOSS) 40,975 ( 637,696) ( 181,911) ( 778,632) 1,007,364
NONOPERATING REVENUES ( EXPENSES):
Investment earnings 74,370 10,711 2 3,940 1 09,021 424
Interest expense ( 92,973) ( 3,832) ( 37,610) ( 134,415) -
Loss on disposal of capital assets - - ( 2,830) ( 2,830) -
Total Nonoperating Revenues ( Expenses) ( 18,603) 6 ,879 ( 16,500) ( 28,224) 424
INCOME ( LOSS) BEFORE
CONNECTION FEES & TRANSFERS 22,372 ( 630,817) ( 198,411) ( 806,856) 1,007,788
CONNECTION FEES 944,758 - - 9 44,758 -
TRANSFERS:
Transfers in 427,384 651,721 1 33,706 1,212,811 10,685
Transfers ( out) ( 242,139) - - ( 242,139) ( 1,054,216)
CHANGES IN NET ASSETS 1,152,375 20,904 ( 64,705) 1,108,574 ( 35,743)
NET ASSETS - BEGINNING 10,544,020 ( 220,868) 1,082,415 11,405,567 3,029,039
PRIOR PERIOD ADJUSTMENTS - - - - ( 43,875)
NET ASSETS - BEGINNING AS RESTATED 10,544,020 ( 220,868) 1,082,415 11,405,567 2,985,164
NET ASSETS - ENDING $ 11,696,395 $ ( 199,964) $ 1,017,710 $ 12,514,141 $ 2,949,421
FOR THE YEAR ENDED JUNE 30, 2006
CITY OF SONOMA
PROPRIETARY FUNDS
STATEMENT OF REVENUE, EXPENSES
AND CHANGES IN NET ASSETS
The notes to the financial statements are an integral part of this statement
18
Governmental
Emergency Activities
Water Medical Services Cemetery Internal Service
Fund Fund Fund Totals Funds
CASH FLOWS FROM OPERATING ACTIVITIES:
Receipts from customers $ 3,374,063 $ 827,276 $ 224,734 $ 4 ,426,073 $ 3,373,465
Payments to employees ( 1,114,512) ( 1,072,709) ( 281,913) ( 2,469,134) ( 2,004,907)
Payments to suppliers and users ( 1,232,192) ( 216,005) ( 97,951) ( 1,546,148) ( 356,883)
Other payments and receipts ( 449,787) ( 123,214) ( 152) ( 573,153) 69,820
Net Cash Provided by ( Used for) Operating Activities 577,572 ( 584,652) ( 155,282) ( 162,362) 1,081,495
CASH FLOWS FROM NONCAPITAL
FINANCING ACTIVITIES:
Cash paid to other funds ( 242,139) ( 513,067) - ( 755,206) ( 1,098,091)
Cash received from other funds 800,654 1,131,939 133,706 2,066,299 10,685
Net Cash Provided by ( Used for) Noncapital Financing Activities 558,515 618,872 133,706 1,311,093 ( 1,087,406)
CASH FLOWS FROM CAPITAL AND RELATED
FINANCING ACTIVITIES:
Cash received from connection fees 944,758 - - 944,758 -
Purchases of capital assets ( 205,687) - ( 30,832) ( 236,519) -
Principal paid on capital debt ( 45,000) ( 40,270) ( 79,811) ( 165,081) -
Interest paid on capital debt ( 92,973) ( 3,832) ( 37,610) ( 134,415) -
Net Cash Used for Capital Related Financing Activities 601,098 ( 44,102) ( 148,253) 408,743 -
CASH FLOWS FROM INVESTING ACTIVITIES:
Interest received 58,513 9,882 22,095 90,490 3 77
Net Cash Provided by Investing Activities 58,513 9,882 22,095 90,490 3 77
NET INCREASE ( DECREASE) IN CASH AND INVESTMENTS 1,795,698 - ( 147,734) 1,647,964 ( 5,534)
CASH AND INVESTMENTS - BEGINNING 1,618,512 - 1,060,921 2 ,679,433 2,969,573
CASH AND INVESTMENTS - ENDING $ 3,414,210 $ - $ 913,187 $ 4 ,327,397 $ 2,964,039
RECONCILIATION OF OPERATING INCOME TO NET
CASH PROVIDED BY OPERATING ACTIVITIES:
Operating income ( loss) $ 40,975 $ ( 637,696) $ ( 181,911) $ ( 778,632) $ 1,007,364
Adjustments to reconcile operating income to cash flows
provided by operating activities:
Depreciation and amortization 419,893 50,110 51,593 521,596 -
Change in assets and liabilities:
Accounts receivable 50,931 ( 14,219) 2,267 38,979 4 07
Deposits & other assets - ( 16,865) - ( 16,865) 24,873
Accounts payable 54,702 16,612 ( 24,487) 46,827 48,096
Compensated absences ( 112) 17,406 2,246 19,540 7 55
Deposits & other liabilities 11,183 - ( 4,990) 6,193 -
NET CASH PROVIDED BY ( USED FOR) OPERATING ACTIVITIES $ 577,572 $ ( 584,652) $ ( 155,282) $ ( 162,362) $ 1,081,495
CITY OF SONOMA
PROPRIETARY FUNDS
STATEMENT OF CASH FLOWS
FOR THE YEAR ENDED JUNE 30, 2006
The notes to the financial statements are an integral part of this statement
19
ASSETS
Cash and investments $ 1 ,628,628
Accounts receivable 2 72,629
Interest receivable 1 2,847
Other assets 1 4,024
Total Assets $ 1 ,928,128
LIABILITIES
Accounts payable $ 1 ,764,396
Deposits payable 1 63,732
Total Liabilities 1 ,928,128
NET ASSETS $ -
CITY OF SONOMA
AGENCY FUNDS
STATEMENT OF FIDUCIARY NET ASSETS
JUNE 30, 2006
The notes to the financial statements are an integral part of this statement
20
Notes to Basic Financial Statements
CITY OF SONOMA, CALIFORNIA
NOTES TO BASIC FINANCIAL STATEMENTS
JUNE 30, 2006
21
NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
A. Description of the Financial Reporting Entity
The City of Sonoma ( the “ City”) is a municipal corporation operating as a general law city in the
State of California. The City operates under a Council - Manager form of government and is
governed by a council of five members. The City provides a full range of municipal services to its
citizens including general government, public safety, public works and facilities/ transportation,
culture, recreation, pubic utilities, and community development. Redevelopment services are
provided primarily through the Community Development Agency ( the “ Agency”) of the City.
These basic financial statements present the city of Sonoma ( the primary government) and its
component units. The component units discussed in Section B ( below) are included in the City’s
reporting entity because of the significant of their operational or financial relationships with the
City.
B. Description of Blended Component Units
The Community Development Agency of the City of Sonoma ( Agency), the Sonoma Community
Housing Corporation ( Corporation), and the Sonoma Public Financing Authority ( Authority) serve
all the citizens of the City. The Agency and Authority are governed by a board comprised of
members of the City’s elected council. The Corporation is governed by two members of the City
Council, two city employees, and one community member appointed by the City Council. The
Corporation was created as a public benefit corporation to provide affordable public housing. The
Corporation’s assets were purchased by the Agency, and the Agency has pledged its revenues for
the repayment of he Corporation’s debt. The Agency and Corporation are reported as a special
revenue fund, a capital projects fund, and a debt service fund. The Authority’s debt is shown in the
water enterprise fund.
The financial statements of the Agency’s can be obtained from the City at No. 1 The Plaza, Sonoma,
CA, 95476.
C. Description of Joint Ventures and Public Entity Risk Pool
The City, in conjunction with other governmental entities, created a number of joint powers
authorities which include the Redwood Empire Municipal Insurance Fund, the Sonoma County
Transportation Authority, the Sonoma County Abandoned Vehicle Abatement Service Authority,
REDCOM ( emergency dispatch for fire and emergency medical services), and the Sonoma Valley
Fire and Rescue Authority ( SVFRA) with Valley of the Moon Fire Protection District. The City
has no obligation other than to pay for a pro rata share of certain operating costs, no entitlement,
and no residual interests in the other jointly governed organizations.
The financial activities of these entities are not included in the accompanying basic financial
statements since its governing board is separate from and independent of the City.
CITY OF SONOMA, CALIFORNIA
NOTES TO BASIC FINANCIAL STATEMENTS
JUNE 30, 2006
22
D. Basis of Presentation
The City’s basic financial statements are prepared in conformity with accounting principles
generally accepted in the United States of America. The Government Accounting Standards Board
(“ GASB”) is the acknowledged standard setting body for establishing accounting and financial
reporting standards followed by governmental entities in the U. S. A.
The accompanying financial statements are presented on the basis set forth in Government
Accounting Standards Board Statements No. 34, Basic Financial Statements— and Management’s
Discussion and Analysis— for State and Local Governments, No. 36, Recipient Reporting for
Certain Non- exchange Revenues, an Amendment of GASB Statement No. 33, No. 37, Basic
Financial Statements— and Management’s Discussion and Analysis— for State and Local
Governments; Omnibus, and No. 38, Certain Financial Statement Note Disclosures.
These Statements require that the financial statements described below be presented.
Government- wide Statements: The Statement of Net Assets and the Statement of Activities display
information about the primary government and its component units. These statements include the
financial activities of the overall City government, except for fiduciary activities. Eliminations
have been made to minimize the effect of interfund activities. Governmental activities, which
generally are financed through taxes, intergovernmental revenues, and other nonexchange
transactions, are reported separately from business- type activities, which significantly rely on fees
and charges for support.
The Statement of Activities presents a comparison between direct expenses and program revenues
for each function of the City’s activities. Direct expenses are those that are specifically associated
with a program or function and, therefore, are clearly identifiable to a particular function. Program
revenues include ( a) charges paid by the recipients of goods or services offered by the programs,
( b) grants and contributions that are restricted to meeting the operational needs of a particular
program and ( c) fees, grants and contributions that are restricted to financing the acquisition or
construction of capital assets. Revenues that are not classified as program revenues, including all
taxes, are presented as general revenues.
Fund Financial Statements: The fund financial statements provide information about the City's
funds, including blended component units. Separate statements for each fund category,
governmental, proprietary and fiduciary, are presented. The emphasis of fund financial statements
is on major individual governmental and enterprise funds, each of which is displayed in a separate
column. All remaining governmental and enterprise funds are aggregated and reported as
nonmajor funds.
Proprietary fund operating revenues, such as charges for services, result from exchange
transactions associated with the principal activity of the fund. Exchange transactions are those in
which each party receives and gives up essentially equal values. Nonoperating revenues, such as
investment earnings, result from nonexchange transactions or ancillary activities.
CITY OF SONOMA, CALIFORNIA
NOTES TO BASIC FINANCIAL STATEMENTS
JUNE 30, 2006
23
E. Major Funds
GASB Statement 34 requires that the City’s major governmental and enterprise funds be identified
and presented separately in the fund financial statements. All other funds, called nonmajor funds,
are combined and reported in a single column, regardless of their fund- type.
Major funds are defined as funds that have assets, liabilities, revenues or expenditures/ expenses
equal to ten percent of their fund- type total and five percent of the grand total. The General Fund
is always a major fund. The City may also select other funds it believes should be presented as
major funds.
The City reported the following major governmental funds:
General Fund - This fund is the general operating fund of the City and is used to account for all
financial resources except those required to be accounted for in another fund.
Community Development Agency Low/ Moderate Income Housing Fund - This fund is used to
account for the twenty percent housing set aside from tax increment proceeds for the purpose of
increasing or improving the community’s supply of low and moderate income housing, pursuant to
Health and Safety Code Section 33334.2.
Community Development Agency Capital Projects Fund - This fund accounts for expenditures
related to capital projects of the Agency and the balance of property tax allocations after debt
service, 20% set aside allocation, and related expenditures made on behalf the Agency.
The City reported the following major Proprietary funds:
Enterprise Funds are used to account for operations that are financed and operated in a manner
similar to private business enterprise – where the intent of the governing body is that the cost
( expenses, including depreciation) of providing goods or services to the general public on a
continuing basis, be financed or recovered primarily through user charges.
Water Fund - This fund is used to account for the revenues and expenses of the City’s water
operations.
Emergency Medical Services Fund - This fund is used to account for the revenues and
expenses of the City’s emergency medical service operations.
Cemetery Fund - This fund is used to account for the revenues and expenses of the City’s
cemetery operations.
The City also reports the following fund types:
Internal Service Funds are used to account for services, which are provided to other departments
on a cost- reimbursement basis. Those services include management information systems, furniture
CITY OF SONOMA, CALIFORNIA
NOTES TO BASIC FINANCIAL STATEMENTS
JUNE 30, 2006
24
and equipment, vehicle replacement, self- insurance, employee benefits, long- term building
maintenance, computer loans, and hardscape maintenance.
Fiduciary Funds include agency funds used to account for assets held by the Town as an agent for
individuals, private organizations, and other governments. The financial activities of this fund are
excluded from the government- wide financial statement but are presented in a separate Fiduciary
Fund financial statement.
F. Basis of Accounting
The government- wide and proprietary fund financial statements are reported using the economic
resources measurement focus and the full accrual basis of accounting. Revenues are recorded
when earned and expenses are recorded at the time liabilities are incurred, regardless of when the
related cash flows take place.
Governmental funds are reported using the current financial resources measurement focus and the
modified accrual basis of accounting. Under this method, revenues are recognized when
measurable and available. The City considers all revenues reported in the governmental funds to
be available if the revenues are collected within sixty days after year- end. Expenditures are
recorded when the related fund liability is incurred, except for principal and interest on general
long- term debt, which is recognized upon becoming due and payable; and except for claims,
judgments and compensated absences, which are recognized when estimable and probable.
Governmental capital asset acquisitions are reported as expenditures in governmental funds.
Proceeds of governmental long- term debt and acquisitions under capital leases are reported as
other financing sources.
Those revenues susceptible to accrual are property and sales taxes, certain intergovernmental
revenues, interest revenue, and charges for services. Fines, forfeitures, and licenses and permits
are not susceptible to accrual because they are not measurable until received in cash.
Non- exchange transactions, in which the City gives or receives value without directly, receiving or
giving equal value in exchange, include taxes, grants, entitlements, and donations. On the accrual
basis, revenue from taxes is recognized in the fiscal year for which the taxes are levied or assessed.
Revenue from grants, entitlements, and donations is recognized in the fiscal year in which all
eligibility requirements have been satisfied.
The City may fund programs with a combination of cost- reimbursement grants, categorical block
grants and general revenues. Thus, both restricted and unrestricted net assets may be available to
finance program expenditures. The City’s policy is to first apply restricted grant resources to such
programs followed by general revenues as necessary.
Certain indirect costs are included in program expenses reported for individual functions and
activities.
CITY OF SONOMA, CALIFORNIA
NOTES TO BASIC FINANCIAL STATEMENTS
JUNE 30, 2006
25
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 statement 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 following subsequent private-sector
guidance for their business- type activities and enterprise funds, subject to this same
limitation. The City has elected not to follow subsequent private- sector guidance.
Use of Estimates - The preparation of financial statements in conformity with generally accepted
accounting principles requires management to make estimates and assumptions that affect the
reported amounts of assets and liabilities and disclosure of contingent asset and liabilities at the
dates of the financial statements and the reported amounts of revenues and expenditures/ expenses
during the reporting periods. Actual results could differ from those estimates.
Cash and Investments - The City’s cash and cash equivalents are considered to be cash on hand,
demand deposits, and highly liquid investments with a maturity of three months or less. State of
California statutes and the City’s investment policy authorize the City to invest in obligations of
the U. S. Treasury, its agencies and instrumentalities, collateralized, non- negotiable certificates of
deposits, commercial paper rated A- 1/ P- 1, medium- term corporate notes rated A or its equivalent
or better by Moody’s or Standard & Poor’s, asset backed corporate notes, bankers’ acceptances,
mutual funds, and the State Treasurer’s investment pool ( Local Agency Investment Fund).
Investments for the City, as well as for its component units, are reported at fair value. The value is
determined based upon market closing prices.
Receivables and Payables - Property, sales, use and utility user taxes related to the current fiscal
year are accrued as revenue and accounts receivable and considered available if received within 60
days of year- end. Federal and state grants are considered receivable and accrued as revenue when
reimbursable costs are incurred under the accrual basis of accounting in the government- wide
statement of net assets. The amount recognized as revenue under the modified accrual basis of
accounting is limited to the amount that is deemed measurable and available. The City considers
these taxes available if they are received during the period when settlement of prior fiscal year
accounts payable and payroll changes normally occur.
Grants, entitlements are shared revenues are recorded as receivables and revenues in the General,
Special Revenue and Capital Projects Funds when they are received or susceptible to accrual.
Allowance for Doubtful Accounts - Management has elected to record bad debts using the direct
write- off method. Accounting principles generally accepted in the United States of America
require that the allowance method be used to reflect bad debts. However, the effect of the use of
the direct write- off method is not materially different from the results that would have been
obtained had the allowance method been followed.
Interfund Receivables and Payables - Balances representing lending/ borrowing transactions
between funds outstanding at the end of the fiscal year are reported as either “ due to/ due from other
funds” ( amounts due within one year), “ advances to/ from other funds” ( non- current portions of
interfund lending/ borrowing transactions), or “ loans to/ from other funds” ( long term
CITY OF SONOMA, CALIFORNIA
NOTES TO BASIC FINANCIAL STATEMENTS
JUNE 30, 2006
26
lending/ borrowing transactions as evidenced by loan agreements). Advances and loans to other
funds are offset by a fund balance reserve in applicable Governmental Funds to indicate they are
not available for appropriation, and are not expendable available financial resources.
Capital Assets - Capital assets are valued at historical cost or estimated historical cost if actual
historical cost is not available. Contributed capital assets are valued at their estimated fair value on
the date contributed. Capital lease obligations are recorded at the present value of future minimum
lease payments and the related assets are recorded as capital assets and depreciated. Capital assets
are recorded if acquisition or construction costs exceed $ 5,000 for fixed assets, $ 20,000 for buildings,
$ 10,000 for building improvements, and $ 50,000 for Infrastructure.
As required by GASB Statement 34, the City depreciates capital assets with limited useful lives
over their estimated useful lives. The purpose of depreciation is to spread the cost of capital assets
equitably among all users over the life of these assets. The amount charged to depreciation expense
each year represents that year’s pro rata share of the cost of capital assets. The City depreciates using
the straight line method which means the cost of the asset is divided by its expected useful life in
years and the result is charged to expense each year until the asset is fully depreciated. The City has
assigned the useful lives listed below to capital assets:
Buildings 25- 50 years
Improvements 25- 50 years
Machinery and equipment 8- 30 years
Furniture and fixtures 5- 12 years
Infrastructure 5- 60 years
Major capital outlay for capital assets and improvements are capitalized as projects are constructed.
Capital assets may be acquired using federal and state grants, contributions from developers, and
contributions or grants from other governments. GASB 34 requires that these contributed assets be
accounted for as revenue at the time they are contributed.
Deferred Compensation Plan - The City established a deferred compensation plan created in
accordance with California Government Code Section 53212 and Internal Revenue Code Section
457. The plan, available to all City employees, permits them to defer a portion of their salary until
future years. The deferred compensation is not available to employees until termination,
retirement, death, or unforeseeable emergency. Deferred compensation plans are not reported as
part of the City’s assets or liabilities, as the deferred compensation plan trustees hold those funds in
trust on behalf of employees until the employees are eligible to receive the benefits.
Post- Employment Benefits - The City provides post retirement health, dental, and vision care
benefits, as per the requirements of a City resolution, to former elected members of the City
Council. The City pays 100 percent of the premiums of health, dental, and vision care coverage for
such elected members who retire with not less than 12 years of services. The City is generally
obligated to pay such premiums for a number of ears equal to each retiree’s cumulative service on
the City Council. As of June 30, 2006, there were two elected members who had retired that were
CITY OF SONOMA, CALIFORNIA
NOTES TO BASIC FINANCIAL STATEMENTS
JUNE 30, 2006
27
receiving the premium coverage. The City Finances the benefits on a pay- as- you- go- basis. For the
fiscal year ended June 30, 2006, the City recognized $ 22,004 in such expenditures. The City has
rescinded the authorizing resolution so that future retirees will be ineligible to receive such
benefits.
Compensated Absences - In compliance with Governmental Accounting Standards Board
Statement No. 16, the City has established a liability for vacation leave in relevant funds. For
governmental funds, the current liability appears in the respective funds. All vacation is accrued
when incurred in the government- wide and proprietary funds financial statements. This liability is
set up for the current employees at the current rates of pay. Vacation time may be accumulated up
to 352 hours per employee. Cash compensation for accrued vacation is generally not payable until
the employee has terminated employment with the City. Sick leave may be accumulated but is not
paid. The General Fund is primarily responsible for the repayment of the governmental portion of
compensated absences.
Deferred Revenue - Deferred revenue in governmental funds of $ 1,202,771 primarily represents
promissory notes in the City’s Community Development Agency. Principal and interest payments
are offset by an equal amount of deferred revenue. Such payments will be recognized as revenue
when received.
Long- Term Obligations - In the government- wide and proprietary fund financial statements, long-term
debt and other long- term obligations are reported as liabilities in the statement of net assets.
Bond premiums and discounts, as well as issuance costs, are deferred and amortized over the life of
the bonds. In the governmental fund financial statements, bond premiums, discounts, and issuance
costs are recognized during the current period. The face amount of debt issued is reported as other
financing sources. Premiums received on debt issuances are reported as other financing sources
while discounts on debt issuances are reported as other financing uses. Issuance costs, whether or
not withheld from the actual debt proceeds received, are reported as debt service expenditures.
Property Tax Levy, Collection and Maximum Rates - State of California Constitution Article XIII
A provides that the combined maximum property tax rate on any given property may not exceed 1%
of its assessed value unless an additional amount for general obligation debt has been approved by
voters. Assessed value is calculated at 100% of market value as defined by Article XIII A and may be
adjusted by no more than 2% per year unless the property is sold, transferred, or substantially
improved. The State Legislature has determined the method of distribution of receipts from a 1% tax
levy among the counties, cities, school districts and other districts.
The County of Sonoma ( County) assesses properties, bills for and collects property taxes on the
following schedule:
Secured Unsecured
Valuation/ lien dates January 1 January 1
Levy dates July 1 July 1
Due dates ( delinquent as of) 50% on November 1 ( December 10) July 1 ( August 31)
50% on February 1 ( April 10)
CITY OF SONOMA, CALIFORNIA
NOTES TO BASIC FINANCIAL STATEMENTS
JUNE 30, 2006
28
The term " unsecured" refers to taxes on personal property other than land and buildings. These taxes
are secured by liens on the property being taxed. Property taxes levied are recorded as revenue and
receivables when they are collected during the fiscal year of levy or within 60 days of year- end.
Budgets and Budgetary Accounting - The City follows the procedures below when establishing the
budgetary data reflected in the financial statements for governmental and proprietary funds:
1. The City Manager submits to the City Council a proposed operating draft budget for the fiscal
year commencing the following July 1. The budgets include the proposed expenditures and
the means of financing them.
2. The City Council reviews the proposed budget at special scheduled sessions, which are open
to the public. Public hearings are conducted to obtain taxpayer comments.
3. Prior to July 1, the budget is legally enacted through the adoption of a resolution by City
Council.
4. From the effective date of the budget, which is adopted and controlled at the department level,
the amounts stated therein as proposed expenditures become appropriations to the various
City departments. The City Council may amend the budget by resolution during the fiscal
year. The City Manager may authorize transfers from one object or program to another
within the same department, and between departments within the General Fund.
5. Budgets are adopted on a basis consistent with generally accepted accounting principles
except for proprietary funds which budget for capital outlays but not depreciation.
6. Budgeted amounts are as originally adopted or as amended by City Council. Individual
amendments were not material in relation to original appropriations.
Encumbrances - Under encumbrance accounting, purchase orders, contract and other commitments
for expenditures are recorded in order to reserve that portion of the applicable appropriation.
Encumbrance accounting is employed as an extension of formal budgetary integration in all funds.
All encumbrances are liquidated at year end while unexpended and unencumbered appropriations
lapse at year end.
Implemented New Accounting Pronouncements - The City adopted the provisions of GASB
Statement No. 46, Net Assets Restricted by Legislation – an amendment to GASB Statement No. 34,
which clarifies that legally enforceable enabling legislation restriction is one that a party external to
a government, such as citizens, public interest groups, of the judiciary, can compel a government to
honor. This statement also specifies the accounting and financial reporting requirements if new
enabling legislation replaces existing legislation or if legal enforceability s reevaluated. Finally,
this statement requires governments to disclose the portion of total net assets that is restricted by
enabling legislation.
CITY OF SONOMA, CALIFORNIA
NOTES TO BASIC FINANCIAL STATEMENTS
JUNE 30, 2006
29
NOTE 2 - CASH AND INVESTMENTS
The City pools cash from all sources and all funds except restricted cash and investments so that it can be
invested at the maximum yield, consistent with safety and liquidity, while existing funds have cash
available for expenditures. Interest income earned on pooled cash and investments is allocated to various
funds based on average maintained balances. Earnings from cash with fiscal agent are credited directly to
the related fund.
Cash and Investments Defined - The City includes cash deposits in checking and money market bank
accounts as cash. Investments in the State of California Local Agency Investment Fund ( LAIF) and
government securities mutual funds are net in the order of liquidity, since they may be withdrawn without
penalty. U. S. Treasuries, U. S. Agencies and Certificates of Deposit are the Town’s least liquid
investments, since they must be held to maturity.
Cash Deposits with Banks - California Law requires banks and savings and loan institutions to pledge
government securities with a market value of 110% of the City’s cash on deposit or first trust deed
mortgage notes with a value of 150% of the deposit as collateral for these deposits. Under California Law
this collateral is held in the City’s name and places the City ahead of general creditors of the institution.
The City has waived collateral requirements for the portion of deposits covered by Federal Depository
Insurance.
The bank balance of the City’s cash deposits was $ 462,241 as of June 30, 2006. Of the bank balance,
$ 100,000 was covered by Federal Depository Insurance and $ 362,241 was uninsured but collateralized as
noted in the preceding paragraph as of June 30, 2006. Differences between the carrying amount and bank
balances are from outstanding deposits and checks as of June 30, 2006.
Cash with Fiscal Agent - Restricted cash and investments are required to be held by outside fiscal agents
under the provisions of various debt issues. These cash and investments are restricted for debt service
requirements.
Investments - The City voluntarily participates in LAIF, regulated under Section 16429 of the State
Government Code. LAIF allows local agencies such as the City to participate in a Pooled Money
Investment Account managed by the State Treasurer Office and overseen by the Pooled Money
Investment Board and State Treasurer investment committee. A Local Agency Investment Advisory
Board oversees LAIF. The investments with LAIF are not classified for credit risk due to their diverse
nature and are stated at cost, which approximates fair value.
The total amount invested by all public agencies in LAIF, as of June 30, 2006, was approximately
$ 63.6 billion. Of that amount, 95% is invested in non- derivative financial products and 5% in
structured notes and asset- backed securities. The average maturity for the investment in LAIF is 152
days.
CITY OF SONOMA, CALIFORNIA
NOTES TO BASIC FINANCIAL STATEMENTS
JUNE 30, 2006
30
Concentration of Credit Risk and Interest Rate Risk Policies
The following table summarizes the City’s policy related to maturities and concentration of investments:
Maximum Maximum
Maximum Portfolio Investment per
Investment Type Maturity Percentage Institution
US Treasury Obligations 5 years 100% NA
US Agency Obligations 5 years 100% NA
Bankers Acceptances 270 days 30% 25%
Medium Term Notes 270 days 30% 25%
Certificates of Deposit - Commercial Banks 5 years 30% 50%
Certificates of Deposits - Savings and Loans Associations 5 years 30% $ 100,000
CA LAIF NA 100% $ 20,000,000
Repurchase Agreements 1 year 25% 10%
The following is a summary of the City’s Cash and Investments as of June 30, 2006.
Available Concentration Time to Weighted
for Investment of Credit Mature Average
Investment Type/ Cash Deposit Operations Restricted Total Rating Risk ( Years) Maturity
U. S. Government Agency securities:
RBC Dain Rauscher ( Morgan Stanley) $ 13,147,982 $ - $ 1 3,147,982 AAA 36% 1.30 1 .30
Government Securities Money Market Mutual Funds - 1,130,119 1 ,130,119 AAA 3% NA NA
Local Agency Investment Fund 22,231,027 - 2 2,231,027 Not Rated 61% 0.42 0 .17
Total Investments 35,379,009 1,130,119 3 6,509,128 100% 1 .47
Cash Deposits with Banks 361,308 - 3 61,308 NA NA NA NA
Cash on Hand 1,125 - 1 ,125 NA NA NA NA
Total Cash and Investments $ 35,741,442 $ 1,130,119 $ 3 6,871,561 100% 1 .47
Cash and investments are classified in the financial statements as shown below, based on whether or not
their use is restricted by Town debt or Agency agreements.
Fiduciary
Total City Funds Totals
Cash and Investments Available for Operation $ 3 4,112,814 $ 1 ,628,628 $ 3 5,741,442
Restricted Cash and Investments 1 ,130,119 - 1 ,130,119
Total Cash and Investments $ 35,242,933 $ 1,628,628 $ 3 6,871,561
CITY OF SONOMA, CALIFORNIA
NOTES TO BASIC FINANCIAL STATEMENTS
JUNE 30, 2006
31
NOTE 3 - RECEIVABLES
The Emergency Medical Services Fund accounts receivable of $ 394,531 was reported net of an
allowance for uncollectible accounts in the amount of $ 165,907.
The long- term notes receivable of $ 1,125,837 in the Low/ Moderate Income Housing Fund are secured
by first deeds of trust on real property. Repayment of the notes are due upon sale of the secured
property unless the terms of the notes are met, at which time the notes will be forgiven.
Various loans were made from the Community Development Agency Capital Projects Fund totaling
$ 23,732 for rehabilitation and renovation of the business property. The loans are payable over five
years at 3% interest per annum.
The loan receivable of $ 41,166 in the General Fund is the portion that Valley of the Moon Fire Protection
District owes to the City for the purchase of firefighting Turnouts.
NOTE 4 - INTERFUND TRANSACTIONS
Inter- fund Receivables and Payables - Amounts due to or due from other funds reflect inter- fund
balances for services rendered or short- term loans expected to be repaid in the next fiscal year. Advances
due to or due from other funds are long- term loans between funds that are to be repaid in their entirety
over several years.
The following tables summarize the City’s due to and due from other funds as of June 30, 2006:
Receivable Fund ( Due From In) Payable fund ( Due To In) Amount
Major Governmental Fund: Major Proprietary Fund:
General Fund Emergency Medical Services Fund $ 480,218
Non- major Governmental Funds:
Strong Motion Fund 2,486
COP Grant 5,185
Cleep Fund 42,503
Traffic Grant Fund 57,827
El Prado Landscape Maintenance Fund 3,895
Starr Ranch Fund 14,344
1993 REFA Lease Acquisition Fund 39,990
1993 REFA Debt Service Fund 37,833
Total Due To/ From Other Funds $ 684,281
The following tables summarize the City’s interfund advances as of June 30, 2006:
Fund Making Advance ( Advances To) Fund Receiving Advance ( Advances From) Amount
Major Governmental Funds: Major Proprietary Fund:
General Fund Cemetery Fund $ 18,991
CITY OF SONOMA, CALIFORNIA
NOTES TO BASIC FINANCIAL STATEMENTS
JUNE 30, 2006
32
Transfers - With Council approval, resources may be transferred from one fund to another. Transfers
routinely reimburse funds that have made an expenditure on behalf of another fund. Transfers may also
be made to pay for capital projects or capital outlays, lease or debt service payments, operating expenses
and low and moderate- income housing projects.
The City uses interfund transfers to ( 1) move revenues from the funds that collect them to the funds that
statutes or the budget requires to them expend them, ( 2) finance programs and capital projects in funds in
accordance with the budget from unrestricted revenues recorded in the General fund, and ( 3) move cash
to debt service funds as debt service requirements become due.
In general, the effect of interfund activities has been eliminated from the government- wide financial
statements. Transfers between funds during the fiscal year ended June 30, 2006 were as follows:
Transfers Transfers
In Out
Major Governmental Funds:
General Fund $ 718,113 $ 653,380
Low/ Moderate Income Housing Fund 50,000 534,527
Community Development Agency Capital Projects Fund - 1,624,021
Major Enterprise Funds:
Water Fund 427,384 242,139
Emergency Medical Services Fund 651,721 -
Cemetery Fund 133,706 -
Non- major Governmental Funds:
Traffic Safety Fund - 21,441
SLESF Law Enforcement Fund - 46,693
Traffic Grant Fund 26,129 -
El Prado Landscape Maintenance Fund 2,100 252
Fryer Creek Landscape Maintenance Fund - 252
Sonoma Valley Oaks Fund - 23,556
Starr Ranch Fund - 7,212
Community Development Agency Special Revenue Fund - 50,000
Gas Tax Fund 146,013 -
Capital Improvement Program Fund - 28,897
1993 REFA Debt Service Fund 128,316 -
1997 Community Development Agency Debt Service Fund 214,295 -
2000 Community Development Agency Debt Service Fund 581,175 -
2003 Tax Allocation Bonds Debt Service Fund 1,196,949 -
Internal Service Funds:
MIS Fund 10,685 934,135
Vehicle Replacement Fund - 120,081
Total Transfers $ 4,286,586 $ 4,286,586
CITY OF SONOMA, CALIFORNIA
NOTES TO BASIC FINANCIAL STATEMENTS
JUNE 30, 2006
33
NOTE 5 - CAPITAL ASSETS
Changes in capital assets consisted of the following for the fiscal year ended June 30, 2006:
Balance
July 1, 2005 Adjustments Additions Deletions Transfers
Balance
June 30, 2006
Capital assets, not being depreciated:
Land $ 7,849,471 $ - $ 2,953,315 $ ( 54,564) $ - $ 10,748,222
Right of ways 356,028 - - - - 356,028
Construction in progress 6,232,311 ( 250,959) 2,167,096 - ( 1,920,102) 6,228,346
Total capital assets, not being depreciated 14,437,810 ( 250,959) 5,120,411 ( 54,564) ( 1,920,102) 17,332,596
Capital assets, being depreciated:
Infrastructure 4,147,382 248,284 - - 1,920,102 6,315,768
Buildings and improvements 13,975,259 - 996,685 ( 42,699) - 14,929,245
Equipment and vehicles 2,852,815 20,635 68,290 ( 163,298) - 2,778,442
Total capital assets, being depreciated 20,975,456 268,919 1,064,975 ( 205,997) 1,920,102 24,023,455
Less accumulated depreciation ( 7,734,720) - ( 553,408) 200,202 - ( 8,087,926)
Total capital assets, being depreciated, net 13,240,736 268,919 511,567 ( 5,795) 1,920,102 15,935,529
Capital assets, net $ 27,678,546 $ 17,960 $ 5,631,978 $ ( 60,359) $ - $ 33,268,125
Governmental Acitivities
Balance
July 1, 2005 Adjustments Additions Deletions Transfers
Balance
June 30, 2006
Capital assets, not being depreciated:
Land $ 960,472 $ - $ - $ - $ - $ 960,472
Construction in progress 1,250,853 ( 30,253) 237,595 - ( 1,368,463) 89,732
Total capital assets, not being depreciated 2,211,325 ( 30,253) 237,595 - ( 1,368,463) 1,050,204
Capital assets, being depreciated:
Buildings and improvements 16,539,004 - - - 1,368,463 17,907,467
Equipment and vehicles 1,543,922 - 29,176 ( 38,144) - 1,534,954
Total capital assets, being depreciated 18,082,926 - 29,176 ( 38,144) 1,368,463 19,442,421
Less accumulated depreciation ( 8,904,957) - ( 516,670) 35,314 - ( 9,386,313)
Total capital assets, being depreciated, net 9,177,969 - ( 487,494) ( 2,830) 1,368,463 10,056,108
Capital assets, net $ 11,389,294 $ ( 30,253) $ ( 249,899) $ ( 2,830) $ - $ 11,106,312
Business- type Acitivities
CITY OF SONOMA, CALIFORNIA
NOTES TO BASIC FINANCIAL STATEMENTS
JUNE 30, 2006
34
Depreciation Allocation - Depreciation expense is charged to functions and programs based on their
usage of the related assets. The amounts allocated to each function or program is as follows:
NOTE 6 - LONG- TERM OBLIGATIONS
The City generally incurs long- term debt to finance projects or purchase assets, which will have useful
lives equal to or greater than the related debt. The City’s long- term debt issues and transactions are
summarized below in the schedule of changes in long- term debt and discussed in detail thereafter.
A. Schedule of Changes in Long- term Debt
Balance Balance Due
July 1 June, 30 Within One
2005 Additions Reductions 2005 Year
Governmental Activities:
1997 Tax Allocation Bonds $ 2,395,000 $ - $ 8 5,000 $ 2,310,000 $ 9 0,000
2000 Tax Allocation Refunding Bonds 8,380,000 - 1 20,000 8,260,000 1 25,000
2003 Tax Allocation Bonds 19,820,000 - 4 10,000 19,410,000 4 10,000
Note Payable - USDA 819,320 - 1 3,642 805,678 1 4,245
Note Payable - Exchange Bank 2,293,932 - 1 04,981 2,188,951 4 0,016
Capital Lease Obligations 958,876 - 1 00,771 858,105 1 11,687
Compensated Absences 196,494 - 1 4,564 181,930 -
Total Governmental Activities Debt 34,863,622 - 8 48,958 34,014,664 7 90,948
Business- type Activities:
Certificates of Participation 2,120,000 - 4 5,000 2,075,000 4 5,000
Capital Lease Obligations 1,042,412 - 1 20,081 922,331 1 25,177
Compensated Absences 84,946 1 9,540 - 104,486 -
Total Business- type Activities Debt 3,247,358 1 9,540 1 65,081 3,101,817 1 70,177
Total Long- term Obligations $ 38,110,980 $ 19,540 $ 1,014,039 $ 37,116,481 $ 961,125
Governmental Business- type
Pr ogram/ Function Activities Activities
General government $ 117,743$ -
Public safety 134,026 -
Public works 54,166 -
Community development 247,473 -
Water - 419,893
Emergency medical services - 50,110
Cemetery - 51,593
Total Depreciation $ 553,408 $ 521,596
CITY OF SONOMA, CALIFORNIA
NOTES TO BASIC FINANCIAL STATEMENTS
JUNE 30, 2006
35
B. Tax Allocation Bonds
Governmental Activities
1997 Tax Allocation Bonds - On July 10, 1997, the City’s Community Development Agency
issued tax allocation bonds in the amount of $ 2,885,000, with an interest rate of 5.58% per annum,
to provide funds for certain projects of the Agency. The bonds mature semiannually in increasing
amounts on each December 1, through 2022. Annual debt service requirements are as follows:
Fiscal Year Ending
June 30 Principal Interest Total
2007 $ 9 0,000 $ 1 25,088$ 2 15,088
2008 9 0,000 1 20,655 2 10,655
2009 9 5,000 1 15,990 2 10,990
2010 1 00,000 1 10,955 2 10,955
2011 1 05,000 1 05,538 2 10,538
2012- 2016 6 25,000 4 32,578 1 ,057,578
2017- 2021 8 15,000 2 34,797 1 ,049,797
2022- 2023 3 90,000 2 4,059 4 14,059
Total $ 2 ,310,000 $ 1 ,269,660 $ 3 ,579,660
2000 Tax Allocation Refunding Bonds - On June 28, 2000, the City’s Community Development
Agency issued $ 8,895,000 of Tax Allocation Refunding Bonds to advance refund $ 2,085,000 of
outstanding 1991 Senior Housing Certificates of Participation. As a result, the $ 2,085,000 of
outstanding Certificates of Participation are considered to be defeased and the liability for those
certificates have been removed from the City’s financial statements. The bonds mature
semiannually in increasing amounts on each December 1, through 2030. Annual debt service
requirements are as follows:
Fiscal Year Ending
June 30 Principal Interest Total
2007 $ 1 25,000 $ 4 56,175$ 5 81,175
2008 1 35,000 4 50,238 5 85,238
2009 1 40,000 4 43,825 5 83,825
2010 1 45,000 4 37,175 5 82,175
2011 1 55,000 4 30,288 5 85,288
2012- 2016 8 75,000 2 ,031,083 2 ,906,083
2017- 2021 1 ,130,000 1 ,772,615 2 ,902,615
2022- 2026 2 ,170,000 1 ,381,706 3 ,551,706
2027- 2031 3 ,385,000 6 00,495 3 ,985,495
Total $ 8 ,260,000 $ 8 ,003,600 $ 1 6,263,600
CITY OF SONOMA, CALIFORNIA
NOTES TO BASIC FINANCIAL STATEMENTS
JUNE 30, 2006
36
2003 Tax Allocation Bonds - On May 29, 2003, the City’s Community Development Agency
issued tax allocation bonds in the amount of $ 20,635,000, with a variable interest rate of 2.09% to
4.45% per annum, to provide funds for certain community development projects. The bonds
mature semiannually in increasing amounts on each December 1, through 2033. Annual debt
service requirements are as follows:
Fiscal Year Ending
June 30 Principal Interest Total
2007 $ 4 10,000 $ 7 76,749 $ 1 ,186,749
2008 4 20,000 7 70,804 1 ,190,804
2009 4 35,000 7 63,034 1 ,198,034
2010 4 40,000 7 52,159 1 ,192,159
2011 4 50,000 7 41,159 1 ,191,159
2012- 2016 2 ,500,000 3 ,480,544 5 ,980,544
2017- 2021 3 ,025,000 2 ,976,300 6 ,001,300
2022- 2026 3 ,735,000 2 ,285,685 6 ,020,685
2027- 2031 4 ,660,000 1 ,382,838 6 ,042,838
2032- 2034 3 ,335,000 3 01,043 3 ,636,043
Total $ 1 9,410,000 $ 1 4,230,315 $ 3 3,640,315
C. Notes Payable
Governmental Activities
2005 Note Payable – USDA - In April of 2005, the City’s Community Development Agency
obtained an $ 821,423 loan from the U. S. Department of Agriculture to assist the Agency in
purchasing and operating the Village Green Apartments II low/ moderate income housing rental
project. The loan is fully amortized over 30 years at an interest rate of 5.625%. The loan is
secured by an interest in the property and rental income and is subordinated to an existing loan
with Exchange Bank. The outstanding balance as of June 30, 2006 was $ 805,678 and the future
minimum obligations as of June 30, 2006 as follows:
Fiscal Year Ending
June 30 Principal Interest Total
2007 $ 1 4,245 $ 3 4,661$ 4 8,906
2008 1 4,875 3 4,031 4 8,906
2009 1 5,532 3 3,374 4 8,906
2010 1 6,218 3 2,688 4 8,906
2011 1 6,935 3 1,971 4 8,906
2012- 2016 9 7,190 1 47,340 2 44,530
2017- 2021 1 21,990 1 22,540 2 44,530
2022- 2026 1 53,165 9 1,365 2 44,530
2027- 2031 1 91,965 5 2,565 2 44,530
2032- 2035 1 63,563 3 1,245 1 94,808
Total $ 8 05,678 $ 6 11,780 $ 1 ,417,458
CITY OF SONOMA, CALIFORNIA
NOTES TO BASIC FINANCIAL STATEMENTS
JUNE 30, 2006
37
2005 Note Payable - Exchange Bank - On March 1, 2005 the City’s Community Development
Agency borrowed $ 2,300,157 from Exchange Bank to purchase the Village Green Apartments, a
Low and Moderate Income Housing Project. The loan is secured by a deed of trust on the
purchased property. Interest on the note is variable at 1.50% above the index rate. The interest
rate cannot go below 4.36% or above 9.36% and cannot adjust more than 2% in any one
adjustment period. The note matures April 1, 2035. The outstanding balance as of June 30, 2006
was $ 2,188,951 and the future minimum annual debt commitments are as follows:
Fiscal Year Ending
June 30 Principal Interest Total
2007 4 0,016 9 7,552 1 37,568
2008 4 1,797 9 5,771 1 37,568
2009 4 3,655 9 3,913 1 37,568
2010 4 5,598 9 1,970 1 37,568
2011 4 6,826 8 9,861 1 36,687
2012- 2016 2 72,653 4 16,066 6 88,719
2017- 2021 3 26,183 3 61,658 6 87,841
2022- 2026 3 88,208 2 99,633 6 87,841
2027- 2031 5 22,217 1 65,624 6 87,841
2032- 2035 4 61,798 9 0,203 5 52,001
Total $ 2 ,188,951 $ 1 ,802,251 $ 3 ,991,202
D. Capital Lease Obligations
Governmental Activities
1993 Financing Authority Leases - The City has entered into lease- purchase agreements with the
Redwood Empire Financing Authority ( the Authority) for the purpose of making improvements to
City property and buildings, and for the acquisition of equipment. These lease agreements qualify
as capital leases for accounting purposes and, therefore, have been recorded at the net present value
of the future minimum lease payments as of the inception date of the leases. The Authority issued
$ 1,430,000 in the Certificates of Participation at 6.00% to obtain the funds needed to make such
improvements and acquisitions, and entered into lease agreements with in the City and Agency to
provide repayment of such Certificates. The 1993 lease payments are secured by a pledge of the
City to make such payments from any source of funds available to the City. The City has agreed to
budget and appropriate monies each year sufficient to pay the required lease payments.
CITY OF SONOMA, CALIFORNIA
NOTES TO BASIC FINANCIAL STATEMENTS
JUNE 30, 2006
38
The net present values of the 1993 Financing Authority future minimum lease payments were as
follows as of June 30, 2006:
Fiscal Year Ending
June 30 Principal Interest Total
2007 $ 8 5,000 $ 4 6,520$ 1 31,520
2008 8 5,000 4 1,378 1 26,378
2009 8 5,000 3 6,193 1 21,193
2010 9 5,000 3 0,560 1 25,560
2011 9 5,000 2 4,480 1 19,480
2012- 2014 3 35,000 3 3,120 3 68,120
Total $ 7 80,000 $ 2 12,251$ 9 92,251
Firefighting Turnouts Leases - On April 8, 2004, the City and Valley of the Moon Fire Protection
District ( District) entered into a lease- purchase agreement with Exchange Bank at an interest rate
of 3.5% for the purchase of 85 sets of firefighting turnout. The payments will be directly charged
in equal share to the City Fire Department and the District. If the District defaults on its share of
the payment, the City will be liable for the entire payment. These lease agreements qualify as
capital leases for accounting purpose and, therefore, have been recorded at the net present value of
the future minimum lease payments as of the inception date of the leases.
The net present values of the firefighting turnout future minimum lease payments were as follows
as of June 30, 2006:
Fiscal Year Ending
June 30 Total
2007 $ 2 8,996
2008 2 8,996
2009 2 4,163
Total minimum lease payments 8 2,155
Less: amount representing interest ( 4,050)
Present value of net minimum lease payments 7 8,105
Less: current portion ( 26,687)
Long- term portion $ 5 1,418
Business- type Activities
Ambulance Lease - The City has entered into lease purchase agreements with commercial
companies for the purpose of acquiring ambulance. The agreements are financing arrangements
and the City has recorded the equipment and related obligation in its accounting records. The
obligations are secured by the vehicles. The interest rate ranges from 4.65% to 5.25%. The net
present value of the future minimum lease payments for the ambulance lease is $ 44,102 due within
the next fiscal year, including interest of $ 1,960.
CITY OF SONOMA, CALIFORNIA
NOTES TO BASIC FINANCIAL STATEMENTS
JUNE 30, 2006
39
Municipal Finance Corporation Leases - The city entered into a lease agreement with Municipal
Finance Corporation ( Corporation) for the development of the Veterans Memorial Park Cemetery
in the amount of $ 960,000. Bi- annual payments of $ 58,710 are due in April and October. The
interest rate for the lease is 4%. The lease agreement required the Corporation to deposit $ 960,000
into a custodial account and held in the name of the Corporation for the benefit of the City. The
deposit was used to pay off a prior loan with Sonoma Valley Bank for which the City was
obligated. The net present values of the future minimum lease payments were as follows as of June
30, 2006:
Fiscal Year Ending
June 30 Total
2007 $ 1 17,421
2008 1 17,421
2009 1 17,421
2010 1 17,421
2011 1 17,421
2012- 2016 4 69,683
Total minimum lease payments 1 ,056,788
Less: amount representing interest ( 176,599)
Present value of net minimum lease payments 8 80,189
Less: current portion ( 83,035)
Long- term portion $ 7 97,154
E. Certificates of Participation ( COP)
Business- type Activities
Finance Authority COP - The City’s Public Financing Authority issued Certificates of
Participation of $ 2,250,000 and loaned the proceeds to the Water Enterprise Fund for water
facilities improvements. Semi- annual interest at 4% and principal payments, pledged by water
revenues, are due in April and October. Annual debt service requirements are as follows:
Fiscal Year Ending
June 30 Principal Interest Total
2007 $ 4 5,000 $ 9 1,724$ 1 36,724
2008 5 0,000 9 0,308 1 40,308
2009 5 0,000 8 8,695 1 38,695
2010 5 0,000 8 6,983 1 36,983
2011 5 5,000 8 5,090 1 40,090
2012- 2016 2 95,000 3 92,273 6 87,273
2017- 2021 3 65,000 3 20,905 6 85,905
2022- 2026 4 60,000 2 23,725 6 83,725
2027- 2031 5 75,000 1 01,531 6 76,531
2032 1 30,000 3 ,088 1 33,088
Total $ 2 ,075,000 $ 1 ,484,320 $ 3 ,559,320
CITY OF SONOMA, CALIFORNIA
NOTES TO BASIC FINANCIAL STATEMENTS
JUNE 30, 2006
40
F. Compensated Absences
City employees accumulate earned but unused vacation benefits which can be converted to cash at
termination of employment. Since no means exists to reasonably estimate the amount that might
be liquidated with expendable currently available financial resources, if any, they are reported as
long- term debt on the Statement of Net Assets. No expenditure is reported for these amounts in the
governmental fund statements. However, in the statement of activities, the expense is allocated to
each function based on usage.
NOTE 7 - NET ASSETS AND FUND BALANCES
Net Assets - Net Assets is the excess of all the City’s assets over all its liabilities, regardless of fund.
Net Assets are divided into three captions under GASB Statement 34. These captions apply only to
Net Assets, which is determined only at the Government- wide level, and are described below:
Invested in Capital Assets, net of related debt describes the portion of Net Assets which is represented by
the current net book value of the City’s capital assets, less the outstanding balance of any debt issued to
finance these assets.
Restricted describes the portion of Net Assets which is restricted as to use by the terms and conditions of
agreements with outside parties, governmental regulations, laws, or other restrictions which the City
cannot unilaterally alter. These principally include debt service requirements and redevelopment funds
restricted to low and moderate income purposes.
Unrestricted describes the portion of Net Assets which is not restricted to use.
Reservations of Fund Balances - Fund balance consists of reserved and unreserved amounts.
Reserved fund balance represents that portion of fund balance that has been appropriated for
expenditure or is legally segregated for a specific future use. As of June 30, 2006, portions of fund
balance had been reserved because of the following:
Long- Term Notes Receivable reserves reflect the balance of long- term loans not offset by deferred
revenue and that are not available for expenditure.
Debt Service reserves reflect the cash balances in the debt service funds that are restricted for debt
service payments.
Capital Projects reserves reflect money set- aside for rehabilitation, development, construction and
capital purchases in the City’s Community Development Agency Capital Projects Fund.
Low/ Moderate Income Housing reserves reflect money set- aside for low- and- moderate income housing
expenditures.
Operating reserves reflect money that will be used to fund future fluctuations in the economy that are
not currently foreseen.
CITY OF SONOMA, CALIFORNIA
NOTES TO BASIC FINANCIAL STATEMENTS
JUNE 30, 2006
41
NOTE 8 - EMPLOYEES' RETIREMENT PLAN
Plan Description - The City of Sonoma contributes to the California Public Employees Retirement
System ( PERS), an agent multiple- employer public employee defined benefit pension plan. PERS
provides retirement and disability benefits, annual cost- of- living adjustments, and death benefits to
plan members and beneficiaries. PERS acts as a common investment and administrative agent for
participating public entities within the State of California. Benefit provisions and all other
requirements are established by state statute and City ordinance. Copies of PERS' annual financial
report may be obtained from their Executive Office, 400 P Street, Sacramento, CA 95814.
Funding Policy - Participants are required to contribute 7% ( 9% for safety employees) of their annual
covered salary. The City is required to contribute at an actuarially determined rate. The rates for the
fiscal year ended June 30, 2006 was 19.8% of annual covered payroll for non- safety ( miscellaneous)
employees and 27.176% for Fire employees. The contribution requirements of plan members and the
City are established and may be amended by PERS.
Annual Pension Cost - For fiscal year ended June 30, 2006, the City's $ 916,027 annual pension cost
for PERS was equal to the City's required and actual contributions. The required contribution was
determined as part of the June 30, 2002 actuarial valuation using the entry age normal actuarial cost
method. The actuarial assumptions included: ( a) 8.25% investment rate of return ( net of administrative
expenses); ( b) projected annual salary increases that vary by age, duration of service, and type of
employment; ( c) 3.5% inflation; ( d) 3.75% payroll growth; and ( e) individual salary growth based on a
merit scale varying by duration of employment coupled with an assumed annual inflation of 3.50% and
an annual production growth of 0.25%. The actuarial value of PERS assets was determined using
techniques that smooth the effects of short- term volatility in the market value of investments over a
three- year period ( smoothed market value) depending on the size of investment gains and/ or losses.
Initial unfunded liabilities are amortized over a closed period that depends on the plan’s date of entry
into PERS. Subsequent plan amendments are amortized as a level percentage of payroll over a closed
20- year period. Gains and losses that occur in the operation of the plan are amortized over a rolling
period, which results in an amortization of 10% of unamortized gains and losses each year. If the
plan’s accrued liability exceeds the actuarial value of plan assets, then the amortization payment on the
total unfunded liability may not be lower than the payment calculated over a 30 year amortization
period.
Three- Year Trend Information PERS
Fiscal Annual Pension Percentage of Net Pension
Year Ended Cost ( APC) APC Contributed Obligation
6/ 30/ 04 $ 642,710 100 0
6/ 30/ 05 671,986 100 0
6/ 30/ 06 916,027 100 0
CITY OF SONOMA, CALIFORNIA
NOTES TO BASIC FINANCIAL STATEMENTS
JUNE 30, 2006
42
Plan Actuarial Value and Funding Progress ( Required Supplementary Information)
NOTE 9 - RISK MANAGEMENT
The City is exposed to various risks of losses related to torts; theft of, damage to, and destruction of
assets; errors and omissions; injuries to employees; and natural disasters. The City purchases
automobile, general liability, property, workers’ compensation, earthquake and flood, boiler and
machinery, and errors and omissions insurance from the Redwood Empire Municipal Insurance Fund
( REMIF), a risk- sharing program. Under this program, the City has a $ 5,000 deductible for workers’
compensation and liability coverage and a $ 10,000 deductible for property retention limit with REMIF
being responsible for losses above that amount up to $ 500,000 for liability losses, $ 1,000,000 for
workers’ compensation claims, and $ 25,000 for property damage. REMIF purchases excess
commercial liability coverage of $ 20,000,000 in excess of its $ 500,000 retention limit to cover losses
above its deductible for general liability and $ 195,000,000 in excess of its $ 25,000 retention limit for
property.
The City is assessed a contribution to cover claims, operating costs and claim settlement expenses
based upon an actuarially determined rate for each coverage layer pool. Additional cash contributions
may be assessed on the basis of adverse loss experience. If the events of the year result in a negative
risk position, the members’ annual assessment may be increased in subsequent years. The City is
unable to reasonably estimate the probability of REMIF ending the year in a negative risk position.
Refunds to members may be made if funds are determined to be surplus as a result on an actuarial
study.
The City currently reports all of its risk management activities in the Insurance Internal Service Fund
and the General Fund. Claims expenditures and liabilities are reported when it is probable that a loss
has occurred and the amount of that loss can be reasonably estimated. During the fiscal year ended
Unfunded
Entry Age Unfunded Annual ( Overfunded)
Valuation Accrued Value of ( Overfunded) Funded Covered Liability as %
Date Liability Assets Liability Ratio Payroll of Payroll
2003 $ 2,596,966,545 $ 2,372,879,034 $ 224,087,511 91.4% $ 725,020,458 30.9%
2004 2,746,095,668 2,460,944,656 285,151,012 89.6% 743,691,970 38.3%
2005 2,891,460,651 2,588,713,000 302,747,651 89.5% 755,046,679 40.1%
Unfunded
Entry Age Unfunded Annual ( Overfunded)
Valuation Accrued Value of ( Overfunded) Funded Covered Liability as %
Date Liability Assets Liability Ratio Payroll of Payroll
2003 $ 1,218,082,935 $ 1,083,690,137 $ 134,392,798 89.0% $ 184,098,257 73.0%
2004 5,383,921,942 4,424,586,846 959,335,096 82.2% 575,296,434 166.8%
2005 6,367,049,264 5,295,150,375 1,071,898,889 83.2% 664,147,796 161.4%
Actuarial - Miscellaneous Plan ( Risk Pool)
Actuarial - Safety Plan ( Risk Pool)
CITY OF SONOMA, CALIFORNIA
NOTES TO BASIC FINANCIAL STATEMENTS
JUNE 30, 2006
43
June 30, 2006, the City paid $ 449,695 for current year coverage and received a rebate from the
program of $ 69,216.
Condensed full accrual basis audited financial information of REMIF as of and for the year ended June
30, 2006, is as follows:
Total Assets $ 16,195,404
Total Liabilities 1 2,196,575
Net Assets $ 3,998,829
Revenues, net refunds $ 8,321,282
Expenses 7,571,481
Net Income ( Loss) $ 749,801
NOTE 10 - COMMITMENTS AND CONTINGENCIES
Grants - The City receives funding from a number of federal, state and local grant programs. These
programs are subject to financial and compliance review by grantors. Accordingly, the City’s
compliance with applicable grant requirements will be determined at some future date. Expenditures, if
any, which may be disallowed by the granting agencies, cannot be determined at this time. The City
does not expect the undeterminable amounts of disallowed expenditures, if any, to materially affect the
financial statements. Receipt of these federal, state and local grant revenues is not assured in the future.
Proposition 218 - On November 5, 1996, California voters approved Proposition 218, which limited
the ability of the state’s local governments to impose, increase, and extend taxes, assessments, and
fees. This applies to all taxes, assessments, and fees enacted or increased on or before January 1, 1995.
The City is resolved to set forth procedures for bringing existing and new assessments, taxes, and fees
into conformity with this law.
The full impact of Proposition 218 on the finances of the City, as well as all local governments in
California, is currently not determinable. This will likely not be apparent until after the state legislature
enacts implementing statutes or court rulings occur. Accordingly, no adjustments have been made to
these financial statements.
Litigation - Various claims involving the City are currently outstanding. However, management
believes, based on consultation with legal counsel, that the ultimate resolution of these matters will not
have a material adverse effect on the City’s financial position or results of operations.
Tax Increment participation Agreements - The Community Development Agency has a
Participation Agreement with Sonoma County ( County) in regard to the sharing of incremental
property taxes. Under the Agreement, the Agency is to retain 80 percent of the tax increment
otherwise attributable to the County as a result of the redevelopment project area. The reduction of tax
increment revenue as a result of this Agreement is expected to be substantial.
CITY OF SONOMA, CALIFORNIA
NOTES TO BASIC FINANCIAL STATEMENTS
JUNE 30, 2006
44
Environmental - The City owns property which was the City dumpsite 50 years ago. Clean- up efforts
were completed during the fiscal year ended June 30, 2003. The City’s portion of the cost of the clean-up
was approximately $ 200,000. On- going monitoring will continue to be conducted. The site will be
left in its natural state and no plans for development have been made.
Required Supplementary Information
VARIANCE WITH
FINAL BUDGET
ORIGINAL FINAL POSITIVE
BUDGET BUDGET ACTUAL ( NEGATIVE)
REVENUES
Taxes $ 6,773,876 $ 6 ,774,008 $ 7,558,023 $ 784,015
Fines and penalties 59,625 59,625 55,377 ( 4,248)
Intergovernmental revenues 170,850 170,850 151,946 ( 18,904)
Charges for services 107,200 107,200 68,261 ( 38,939)
License, permits and fees 584,300 584,300 624,695 40,395
Investment earnings 110,000 110,000 157,363 47,363
Rental income 85,000 85,000 98,326 13,326
Sale of property - - 2,811,492 2,811,492
Other revenue 50,500 50,500 76,521 26,021
Total Revenues 7,941,351 7,941,483 11,602,004 3,660,521
EXPENDITURES
Current:
General government
City council 110,231 110,231 88,748 21,483
City manager 353,958 351,827 254,860 96,967
City attorney 165,500 165,500 199,025 ( 33,525)
Finance 155,251 155,251 120,661 34,590
City clerk 105,237 109,571 90,368 19,203
Non- departmental 775,658 775,907 309,257 466,650
Public safety
Police 3,233,636 3,233,636 3,145,766 87,870
Fire 1,739,860 1,741,003 1,256,440 484,563
Public works
Public works 906,409 911,441 785,621 125,820
Planning and zoning 440,696 437,888 374,790 63,098
Building 420,500 417,654 368,484 49,170
Culture and leisure
Community activities 342,800 - 308,125 ( 308,125)
Capital outlay - - 1,823,530 ( 1,823,530)
Debt service:
Principal - - 25,771 ( 25,771)
Interest & fees - - 1,606 ( 1,606)
Total Expenditures 8,749,736 8,409,909 9,153,052 ( 743,143)
EXCESS ( DEFICIENCY) OF REVENUES
OVER EXPENDITURES ( 808,385) ( 468,426) 2,448,952 2,917,378
OTHER FINANCING SOURCES ( USES)
Transfers in 792,906 792,906 718,113 ( 74,793)
Transfers ( out) ( 491,923) ( 491,923) ( 653,380) ( 161,457)
Total Other Financing Sources ( Uses) 300,983 300,983 64,733 ( 236,250)
NET CHANGES IN FUND BALANCE $ ( 507,402) $ ( 167,443) 2,513,685 $ 2,681,128
FUND BALANCE - BEGINNING 5,278,300
FUND BALANCE - ENDING $ 7,791,985
BUDGET AND ACTUAL
FOR THE YEAR ENDED JUNE 30, 2006
CITY OF SONOMA
GENERAL FUND
SCHEDULE OF REVENUES, EXPENDITURES
AND CHANGES IN FUND BALANCE
45
VARIANCE WITH
FINAL BUDGET
ORIGINAL FINAL POSITIVE
BUDGET BUDGET ACTUAL ( NEGATIVE)
REVENUES
Taxes $ 982,200 $ 9 82,200 $ 973,522 $ ( 8,678)
Investment earnings 82,600 8 2,600 137,905 55,305
Other revenue - - 86,238 86,238
Total Revenues 1,064,800 1 ,064,800 1,197,665 132,865
EXPENDITURES
Current:
Community development 119,170 1 19,170 83,933 35,237
Capital outlay 1,726,000 1 ,726,000 590,527 1,135,473
Total Expenditures 1,845,170 1 ,845,170 674,460 1,170,710
EXCESS ( DEFICIENCY) OF REVENUES
OVER EXPENDITURES ( 780,370) ( 780,370) 523,205 1,303,575
OTHER FINANCING SOURCES ( USES)
Transfers in 50,000 5 0,000 50,000 -
Transfers ( out) ( 534,529) ( 534,529) ( 534,527) 2
Total Other Financing Sources ( Uses) ( 484,529) ( 484,529) ( 484,527) 2
NET CHANGES IN FUND BALANCE $ ( 1,264,899) $ ( 1,264,899) 38,678 $ 1,303,577
FUND BALANCE - BEGINNING 6,115,228
FUND BALANCE - ENDING $ 6,153,906
BUDGET AND ACTUAL
FOR THE YEAR ENDED JUNE 30, 2006
CITY OF SONOMA
COMMUNITY DEVELOPMENT AGENCY
LOW/ MODERATE INCOME HOUSING FUND
AND CHANGES IN FUND BALANCE
SCHEDULE OF REVENUES, EXPENDITURES
46
Supplementary Information
Youth
Strong COP Asset and Family Traffic
Motion Grant Forfeiture Service Safety
Fund Fund Fund Fund Fund
ASSETS
Cash and investments $ - $ - $ 7,356 $ 5 $ -
Cash and investments - restricted - - - - -
Accounts receivable - net - 30,000 - - 5,187
Interest receivable - - 47 - 160
Due from other funds - - - - -
Deposits & other assets - - - - -
Notes receivable - - - - -
Total Assets $ - $ 30,000 $ 7,403 $ 5 $ 5,347
LIABILITIES AND FUND BALANCES
Liabilities:
Accounts payable $ 317 $ - $ - $ - $ -
Due to other funds 2,486 - - - 5,185
Deposits payable & other - - - - -
Deferred revenue - - - - -
Total Liabilities 2,803 - - - 5,185
Fund Balances:
Reserved for:
Debt service - - - - -
Low/ moderate income housing - - - - -
Unreserved reported in:
Special revenue funds ( 2,803) 30,000 7,403 5 162
Capital projects funds - - - - -
Debt service funds - - - - -
Total Fund Balances ( 2,803) 30,000 7,403 5 162
Total Liabilities and Fund Balances $ - $ 30,000 $ 7,403 $ 5 $ 5,347
( Continued)
SPECIAL REVENUE FUNDS
CITY OF SONOMA
NONMAJOR GOVERNMENTAL FUNDS
COMBINING BALANCE SHEETS
JUNE 30, 2006
47
ASSETS
Cash and investments
Cash and investments - restricted
Accounts receivable - net
Interest receivable
Due from other funds
Deposits & other assets
Notes receivable
Total Assets
LIABILITIES AND FUND BALANCES
Liabilities:
Accounts payable
Due to other funds
Deposits payable & other
Deferred revenue
Total Liabilities
Fund Balances:
Reserved for:
Debt service
Low/ moderate income housing
Unreserved reported in:
Special revenue funds
Capital projects funds
Debt service funds
Total Fund Balances
Total Liabilities and Fund Balances
SLESF Bond
Law Eastside Traffic Property
Cleep Enforcement Estate Grant Maintenance
Fund Fund Fund Fund Fund
$ - $ 304 $ 28,872 $ - $ 43,029
- - - - -
2,604 - - 99,316 225
- 128 222 - 327
- - - - -
- - - - -
- - - - -
$ 2,604 $ 432 $ 29,094 $ 99,316 $ 43,581
$ 27 $ - $ - $ 15,360 $ -
42,503 - - 57,827 -
- - 30,891 - -
- - - - -
42,530 - 30,891 73,187 -
- - - - -
- - - - -
( 39,926) 432 ( 1,797) 26,129 43,581
- - - - -
- - - - -
( 39,926) 432 ( 1,797) 26,129 43,581
$ 2,604 $ 432 $ 29,094 $ 99,316 $ 43,581
( Continued)
SPECIAL REVENUE FUNDS
CITY OF SONOMA
NONMAJOR GOVERNMENTAL FUNDS
COMBINING BALANCE SHEETS
JUNE 30, 2006
48
ASSETS
Cash and investments
Cash and investments - restricted
Accounts receivable - net
Interest receivable
Due from other funds
Deposits & other assets
Notes receivable
Total Assets
LIABILITIES AND FUND BALANCES
Liabilities:
Accounts payable
Due to other funds
Deposits payable & other
Deferred revenue
Total Liabilities
Fund Balances:
Reserved for:
Debt service
Low/ moderate income housing
Unreserved reported in:
Special revenue funds
Capital projects funds
Debt service funds
Total Fund Balances
Total Liabilities and Fund Balances
Fryer
El Prado Creek Sonoma
Mayssonave Landscape Landscape Valley Schell Starr
Property Maintenance Maintenance Oaks Drainge Ranch
Fund Fund Fund Fund Fund Fund
$ 70,185 $ - $ 9,981 $ 54,530 $ 155,755 $ -
- - - - - -
180 - - 2,201 - -
524 - 77 439 1,168 -
- - - - - -
- - - - - -
- - - - - -
$ 70,889 $ - $ 10,058 $ 57,170 $ 156,923 $ -
$ - $ 200 $ 277 $ 1,077 $ - $ 455
- 3,895 - - - 14,344
- - - - 145,582 -
- - - - - -
- 4,095 277 1,077 145,582 14,799
- - - - - -
- - - - - -
70,889 ( 4,095) 9,781 56,093 11,341 ( 14,799)
- - - - - -
- - - - - -
70,889 ( 4,095) 9,781 56,093 11,341 ( 14,799)
$ 70,889 $ - $ 10,058 $ 57,170 $ 156,923 $ -
( Continued)
SPECIAL REVENUE FUNDS
CITY OF SONOMA
NONMAJOR GOVERNMENTAL FUNDS
COMBINING BALANCE SHEETS
JUNE 30, 2006
49
ASSETS
Cash and investments
Cash and investments - restricted
Accounts receivable - net
Interest receivable
Due from other funds
Deposits & other assets
Notes receivable
Total Assets
LIABILITIES AND FUND BALANCES
Liabilities:
Accounts payable
Due to other funds
Deposits payable & other
Deferred revenue
Total Liabilities
Fund Balances:
Reserved for:
Debt service
Low/ moderate income housing
Unreserved reported in:
Special revenue funds
Capital projects funds
Debt service funds
Total Fund Balances
Total Liabilities and Fund Balances
Community
Development Community
Agency Development
Abandoned Special Village Gas Block
Vehicle Revenue Green Tax Grant
Fund Fund Fund Fund Fund
$ 65,725 $ 404,238 $ 332,224 $ 109,287 $ 51,086
- - - - -
- - - 33,594 -
- 2,987 501 782 383
- - - - -
- - - - -
- - - - -
$ 65,725 $ 407,225 $ 332,725 $ 143,663 $ 51,469
$ - $ 2,822 $ 18,837 $ 17,044 $ -
- - - - -
- 13,865 - - -
- - - - -
- 16,687 18,837 17,044 -
- - - - -
- - 313,888 - -
65,725 390,538 - 126,619 51,469
- - - - -
- - - - -
65,725 390,538 313,888 126,619 51,469
$ 65,725 $ 407,225 $ 332,725 $ 143,663 $ 51,469
( Continued)
SPECIAL REVENUE FUNDS
COMBINING BALANCE SHEETS
JUNE 30, 2006
CITY OF SONOMA
NONMAJOR GOVERNMENTAL FUNDS
50
ASSETS
Cash and investments
Cash and investments - restricted
Accounts receivable - net
Interest receivable
Due from other funds
Deposits & other assets
Notes receivable
Total Assets
LIABILITIES AND FUND BALANCES
Liabilities:
Accounts payable
Due to other funds
Deposits payable & other
Deferred revenue
Total Liabilities
Fund Balances:
Reserved for:
Debt service
Low/ moderate income housing
Unreserved reported in:
Special revenue funds
Capital projects funds
Debt service funds
Total Fund Balances
Total Liabilities and Fund Balances
1993
Capital Street REFA
Improvement Resurfacing Measure Lease
Program Project M Acquisition
Fund Fund Fund Fund
$ 6 85,575 $ 7 0 $ 4 9,730 $ -
- - - -
- - - -
7 ,211 1 3 70 -
- - - -
- - - -
- - - -
$ 6 92,786 $ 7 1 $ 5 0,100 $ -
$ 2 03,977 $ - $ - $ -
- - - 39,990
- - - -
- - - -
2 03,977 - - 39,990
- - - -
- - - -
- - - -
4 88,809 7 1 5 0,100 ( 39,990)
- - - -
4 88,809 7 1 5 0,100 ( 39,990)
$ 6 92,786 $ 7 1 $ 5 0,100 $ -
( Continued)
CAPITAL PROJECT FUNDS
COMBINING BALANCE SHEETS
JUNE 30, 2006
CITY OF SONOMA
NONMAJOR GOVERNMENTAL FUNDS
51
ASSETS
Cash and investments
Cash and investments - restricted
Accounts receivable - net
Interest receivable
Due from other funds
Deposits & other assets
Notes receivable
Total Assets
LIABILITIES AND FUND BALANCES
Liabilities:
Accounts payable
Due to other funds
Deposits payable & other
Deferred revenue
Total Liabilities
Fund Balances:
Reserved for:
Debt service
Low/ moderate income housing
Unreserved reported in:
Special revenue funds
Capital projects funds
Debt service funds
Total Fund Balances
Total Liabilities and Fund Balances
1997 2000 2003
Community Community Tax
1993 Development Development Allocation Total
REFA Agency Agency Bonds Combining
Debt Service Debt Service Debt Service Debt Service Nonmajor
Fund Fund Fund Fund Funds
$ - $ 79,317 $ 269,071 $ 1 12,652 $ 2,528,992
134,539 197,428 52 89 332,108
- - - - 173,307
- 760 2,617 1,854 20,558
- - - - -
- - 2,497 1,900 4 ,397
- - - - -
$ 134,539 $ 277,505 $ 274,237 $ 1 16,495 $ 3,059,362
$ - $ - $ - $ - $ 260,393
37,833 - - - 204,063
- - - - 190,338
- - - - -
37,833 - - - 654,794
134,539 277,505 274,237 1 16,495 802,776
- - - - 313,888
- - - - 826,747
- - - - 498,990
( 37,833) - - - ( 37,833)
96,706 277,505 274,237 1 16,495 2,404,568
$ 134,539 $ 277,505 $ 274,237 $ 1 16,495 $ 3,059,362
( Concluded)
DEBT SERVICE FUNDS
COMBINING BALANCE SHEETS
JUNE 30, 2006
CITY OF SONOMA
NONMAJOR GOVERNMENTAL FUNDS
52
Youth
Strong COP Asset and Family Traffic
Motion Grant Forfeiture Service Safety Cleep
Fund Fund Fund Fund Fund Fund
REVENUES
Taxes $ - $ - $ - $ - $ - $ -
Fines and penalties - - - - - -
Special assessments - - - - - -
Intergovernmental revenues 1,695 30,000 - - - -
Charges for services - - - - - -
License, permits and fees - - - - - -
Investment earnings - - 225 - 1 93 -
Rental income - - - - - -
Other revenue - - 5,963 - - -
Total Revenues 1,695 30,000 6,188 - 1 93 -
EXPENDITURES
Current:
General government - - - - - -
Community development - - - - - -
Public safety - - - - - -
Public works 1,125 - - - - -
Capital outlay - - - - - 1 9,948
Debt service:
Principal - - - - - -
Interest & fees - - - - - -
Total Expenditures 1,125 - - - - 1 9,948
EXCESS ( DEFICIENCY) OF REVENUES
OVER EXPENDITURES 570 30,000 6,188 - 1 93 ( 19,948)
OTHER FINANCING SOURCES ( USES)
Transfers in - - - - - -
Transfers ( out) - - - - ( 21,441) -
Total Other Financing Sources ( Uses) - - - - ( 21,441) -
NET CHANGES IN FUND BALANCES 570 30,000 6,188 - ( 21,248) ( 19,948)
FUND BALANCES - BEGINNING ( 3,373) - 1,215 5 2 1,410 ( 19,978)
PRIOR PERIOD ADJUSTMENTS - - - - - -
FUND BALANCES - BEGINNING AS RESTATED ( 3,373) - 1,215 5 2 1,410 ( 19,978)
FUND BALANCES - ENDING $ ( 2,803) $ 30,000 $ 7,403 $ 5 $ 1 62 $ ( 39,926)
( Continued)
COMBINING SCHEDULE OF REVENUES, EXPENDITURES
SPECIAL REVENUE FUNDS
AND CHANGES IN FUND BALANCES
FOR THE YEAR ENDED JUNE 30, 2006
CITY OF SONOMA
NONMAJOR GOVERNMENTAL FUNDS
53
REVENUES
Taxes
Fines and penalties
Special assessments
Intergovernmental revenues
Charges for services
License, permits and fees
Investment earnings
Rental income
Other revenue
Total Revenues
EXPENDITURES
Current:
General government
Community development
Public safety
Public works
Capital outlay
Debt service:
Principal
Interest & fees
Total Expenditures
EXCESS ( DEFICIENCY) OF REVENUES
OVER EXPENDITURES
OTHER FINANCING SOURCES ( USES)
Transfers in
Transfers ( out)
Total Other Financing Sources ( Uses)
NET CHANGES IN FUND BALANCES
FUND BALANCES - BEGINNING
PRIOR PERIOD ADJUSTMENTS
FUND BALANCES - BEGINNING AS RESTATED
FUND BALANCES - ENDING
SLESF Bond
Law Eastside Traffic Property Mayssonave
Enforcement Estate Grant Maintenance Property
Fund Fund Fund Fund Fund
$ - $ - $ - $ - $ -
- - - - -
- - - - -
1 00,000 - 9 9,316 - -
- - - - -
- - - - -
2 05 1 ,023 - 1 ,790 2 ,456
- - - 9 ,038 7 ,231
- - - - -
1 00,205 1 ,023 9 9,316 1 0,828 9 ,687
- 1 ,200 - 1 9,190 1 ,840
- - - - -
8 ,314 - 7 3,187 - -
- - - - -
- - 2 6,129 4 ,104 2 ,280
- - - - -
- - - - -
8 ,314 1 ,200 9 9,316 2 3,294 4 ,120
9 1,891 ( 177) - ( 12,466) 5 ,567
- - 2 6,129 - -
( 46,693) - - - -
( 46,693) - 2 6,129 - -
4 5,198 ( 177) 2 6,129 ( 12,466) 5 ,567
( 44,766) ( 1,620) - 5 6,047 6 5,322
- - - - -
( 44,766) ( 1,620) - 5 6,047 6 5,322
$ 4 32 $ ( 1,797) $ 2 6,129 $ 4 3,581 $ 7 0,889
( Continued)
FOR THE YEAR ENDED JUNE 30, 2006
SPECIAL REVENUE FUNDS
COMBINING SCHEDULE OF REVENUES, EXPENDITURES
AND CHANGES IN FUND BALANCES
CITY OF SONOMA
NONMAJOR GOVERNMENTAL FUNDS
54
REVENUES
Taxes
Fines and penalties
Special assessments
Intergovernmental revenues
Charges for services
License, permits and fees
Investment earnings
Rental income
Other revenue
Total Revenues
EXPENDITURES
Current:
General government
Community development
Public safety
Public works
Capital outlay
Debt service:
Principal
Interest & fees
Total Expenditures
EXCESS ( DEFICIENCY) OF REVENUES
OVER EXPENDITURES
OTHER FINANCING SOURCES ( USES)
Transfers in
Transfers ( out)
Total Other Financing Sources ( Uses)
NET CHANGES IN FUND BALANCES
FUND BALANCES - BEGINNING
PRIOR PERIOD ADJUSTMENTS
FUND BALANCES - BEGINNING AS RESTATED
FUND BALANCES - ENDING
Fryer
El Prado Creek Sonoma
Landscape Landscape Valley Schell Starr
Maintenance Maintenance Oaks Drainge Ranch
Fund Fund Fund Fund Fund
$ - $ - $ 5 1,012 $ - $ -
- - - - -
- - - - -
- - - - -
4 ,399 1 ,884 - - -
- - - - -
- 3 72 1 ,590 5 ,454 -
- - - - -
- - - - -
4 ,399 2 ,256 5 2,602 5 ,454 -
- - - - -
3 ,402 3 ,047 1 6,204 - 2 ,602
- - - - -
- - - - -
- - - - -
- - - - -
- - - - -
3 ,402 3 ,047 1 6,204 - 2 ,602
9 97 ( 791) 3 6,398 5 ,454 ( 2,602)
2 ,100 - - - -
( 252) ( 252) ( 23,556) - ( 7,212)
1 ,848 ( 252) ( 23,556) - ( 7,212)
2 ,845 ( 1,043) 1 2,842 5 ,454 ( 9,814)
( 6,940) 1 0,824 4 3,251 5 ,887 ( 4,985)
- - - - -
( 6,940) 1 0,824 4 3,251 5 ,887 ( 4,985)
$ ( 4,095) $ 9 ,781 $ 5 6,093 $ 1 1,341 $ ( 14,799)
( Continued)
FOR THE YEAR ENDED JUNE 30, 2006
SPECIAL REVENUE FUNDS
COMBINING SCHEDULE OF REVENUES, EXPENDITURES
AND CHANGES IN FUND BALANCES
CITY OF SONOMA
NONMAJOR GOVERNMENTAL FUNDS
55
REVENUES
Taxes
Fines and penalties
Special assessments
Intergovernmental revenues
Charges for services
License, permits and fees
Investment earnings
Rental income
Other revenue
Total Revenues
EXPENDITURES
Current:
General government
Community development
Public safety
Public works
Capital outlay
Debt service:
Principal
Interest & fees
Total Expenditures
EXCESS ( DEFICIENCY) OF REVENUES
OVER EXPENDITURES
OTHER FINANCING SOURCES ( USES)
Transfers in
Transfers ( out)
Total Other Financing Sources ( Uses)
NET CHANGES IN FUND BALANCES
FUND BALANCES - BEGINNING
PRIOR PERIOD ADJUSTMENTS
FUND BALANCES - BEGINNING AS RESTATED
FUND BALANCES - ENDING
Community
Development Community
Agency Development
Abandoned Special Village Gas Block
Vehicle Revenue Green Tax Grant
Fund Fund Fund Fund Fund
$ - $ - $ - $ - $ -
- - - - -
- - - - -
- - - 1 88,886 -
- - - 8 ,324 -
6 5,725 - - - -
- 1 4,028 7 ,309 2 ,493 1,815
- 1 83,545 3 92,875 - -
- 3 ,555 2 6,292 - -
6 5,725 2 01,128 4 26,476 1 99,703 1,815
- - - - -
- 9 7,903 1 97,681 - -
- - - - -
- - - - -
- 5 7,324 - 2 29,371 -
- - 1 18,623 - -
- - 6 4,864 - -
- 1 55,227 3 81,168 2 29,371 -
6 5,725 4 5,901 4 5,308 ( 29,668) 1,815
- - - 1 46,013 -
- ( 50,000) - - -
- ( 50,000) - 1 46,013 -
6 5,725 ( 4,099) 4 5,308 1 16,345 1,815
- 3 94,637 2 68,580 ( 33,602) 49,654
- - - 4 3,876 -
- 3 94,637 2 68,580 1 0,274 49,654
$ 6 5,725 $ 3 90,538 $ 3 13,888 $ 1 26,619 $ 51,469
( Continued)
SPECIAL REVENUE FUNDS
FOR THE YEAR ENDED JUNE 30, 2006
COMBINING SCHEDULE OF REVENUES, EXPENDITURES
AND CHANGES IN FUND BALANCES
NONMAJOR GOVERNMENTAL FUNDS
CITY OF SONOMA
56
REVENUES
Taxes
Fines and penalties
Special assessments
Intergovernmental revenues
Charges for services
License, permits and fees
Investment earnings
Rental income
Other revenue
Total Revenues
EXPENDITURES
Current:
General government
Community development
Public safety
Public works
Capital outlay
Debt service:
Principal
Interest & fees
Total Expenditures
EXCESS ( DEFICIENCY) OF REVENUES
OVER EXPENDITURES
OTHER FINANCING SOURCES ( USES)
Transfers in
Transfers ( out)
Total Other Financing Sources ( Uses)
NET CHANGES IN FUND BALANCES
FUND BALANCES - BEGINNING
PRIOR PERIOD ADJUSTMENTS
FUND BALANCES - BEGINNING AS RESTATED
FUND BALANCES - ENDING
1993
Capital Street REFA
Improvement Resurfacing Measure Lease
Program Project M Acquisition
Fund Fund Fund Fund
$ - $ - $ 49,569 $ -
- - - -
- - - -
25,740 - - -
- - - -
645,052 - - -
14,375 2 531 -
- - - -
- - - -
685,167 2 50,100 -
- - - -
- - - -
- - - -
- - - -
577,911 - - -
- - - -
- - - -
577,911 - - -
107,256 2 50,100 -
- - - -
( 28,897) - - -
( 28,897) - - -
78,359 2 50,100 -
325,450 69 - ( 39,990)
85,000 - - -
410,450 69 - ( 39,990)
$ 488,809 $ 71 $ 50,100 $ ( 39,990)
( Continued)
CAPITAL PROJECT FUNDS
FOR THE YEAR ENDED JUNE 30, 2006
COMBINING SCHEDULE OF REVENUES, EXPENDITURES
AND CHANGES IN FUND BALANCES
CITY OF SONOMA
NONMAJOR GOVERNMENTAL FUNDS
57
REVENUES
Taxes
Fines and penalties
Special assessments
Intergovernmental revenues
Charges for services
License, permits and fees
Investment earnings
Rental income
Other revenue
Total Revenues
EXPENDITURES
Current:
General government
Community development
Public safety
Public works
Capital outlay
Debt service:
Principal
Interest & fees
Total Expenditures
EXCESS ( DEFICIENCY) OF REVENUES
OVER EXPENDITURES
OTHER FINANCING SOURCES ( USES)
Transfers in
Transfers ( out)
Total Other Financing Sources ( Uses)
NET CHANGES IN FUND BALANCES
FUND BALANCES - BEGINNING
PRIOR PERIOD ADJUSTMENTS
FUND BALANCES - BEGINNING AS RESTATED
FUND BALANCES - ENDING
1997 2000 2003
Community Community Tax
1993 Development Development Allocation Total
REFA Agency Agency Bonds Combining
Debt Service Debt Service Debt Service Debt Service Nonmajor
Fund Fund Fund Fund Funds
$ - $ - $ - $ - $ 1 00,581
- - - - -
- - - - -
- - - - 4 45,637
- - - - 1 4,607
- - - - 7 10,777
7 92 6,569 20,600 2 5,360 1 07,182
- - - - 5 92,689
4,057 5,632 5 2 1 36 4 5,687
4,849 12,201 20,652 2 5,496 2 ,017,160
2 00 - - - 2 2,430
- - - - 3 20,839
- - - - 8 1,501
- - - - 1 ,125
- - - - 9 17,067
75,000 85,000 120,000 410,000 8 08,623
51,793 131,230 459,252 781,022 1 ,488,161
126,993 216,230 579,252 1,191,022 3 ,639,746
( 122,144) ( 204,029) ( 558,600) ( 1,165,526) ( 1,622,586)
128,316 214,295 581,175 1,196,949 2 ,294,977
- - - - ( 178,303)
128,316 214,295 581,175 1,196,949 2 ,116,674
6,172 10,266 22,575 3 1,423 4 94,088
90,534 267,239 251,662 8 5,072 1 ,781,604
- - - - 1 28,876
90,534 267,239 251,662 8 5,072 1 ,910,480
$ 96,706 $ 277,505 $ 274,237 $ 116,495 $ 2 ,404,568
( Concluded)
COMBINING SCHEDULE OF REVENUES, EXPENDITURES
AND CHANGES IN FUND BALANCES
FOR THE YEAR ENDED JUNE 30, 2006
DEBT SERVICE FUNDS
CITY OF SONOMA
NONMAJOR GOVERNMENTAL FUNDS
58
Long- term
Furniture and Vehicle Employee Building Computer Hardscape
MIS Equipment Replacement Insurance Benefits Maintenance Loans Maintenance
Fund Fund Fund Fund Fund Fund Fund Fund Totals
ASSETS
Current Assets:
Cash and investments $ 2 07,482 $ - $ 1,408,389 $ 2 61,144 $ 1 00,001 $ 923,575 $ 5 4,924 $ 8,524 $ 2 ,964,039
Accounts receivable - net - - - - 2 ,952 - 6,216 - 9 ,168
Interest receivable - - - - - - - 60 6 0
Other assets 1 1,472 - - - 3 7,690 - - - 4 9,162
Total Assets $ 2 18,954 $ - $ 1,408,389 $ 2 61,144 $ 1 40,643 $ 923,575 $ 6 1,140 $ 8,584 $ 3 ,022,429
LIABILITIES
Current Liabilities:
Accounts Payable $ 1 8,511 $ - $ - $ 5 ,017 $ 4 7,049 $ - $ - $ - $ 7 0,577
Compensated absences 2 ,431 - - - - - - - 2 ,431
Deposits & other liabilities - - - - - - - - -
Total Liabilities $ 2 0,942 $ - $ - $ 5 ,017 $ 4 7,049 $ - $ - $ - $ 7 3,008
NET ASSETS
Unrestricted $ 1 98,012 $ - $ 1,408,389 $ 2 56,127 $ 9 3,594 $ 923,575 $ 6 1,140 $ 8,584 $ 2 ,949,421
Total Net Assets $ 1 98,012 $ - $ 1,408,389 $ 2 56,127 $ 9 3,594 $ 923,575 $ 6 1,140 $ 8,584 $ 2 ,949,421
CITY OF SONOMA
INTERNAL SERVICE FUNDS
COMBINING SCHEDULE OF NET ASSETS
JUNE 30, 2006
59
Long- term
Furniture and Vehicle Employee Building Computer Hardscape
MIS Equipment Replacement Insurance Benefits Maintenance Loans Maintenance
Fund Fund Fund Fund Fund Fund Fund Fund Totals
OPERATING REVENUES
Charges for services $ 2 53,527 $ - $ 9 08,871 $ 2 70,912 $ 1 ,756,458 $ 177,186 $ - $ 5,256 $ 3,372,210
Miscellaneous - - - - 6 9,216 - 1,984 - 71,200
Total Operating Revenues 2 53,527 - 9 08,871 2 70,912 1 ,825,674 177,186 1,984 5,256 3,443,410
OPERATING EXPENSES
Salaries and benefits 2 0,943 - - - 1 ,984,719 - - - 2,005,662
Supplies and maintenance 1 61,197 - - - - 3,870 - - 165,067
Insurance premiums and claims - - - 2 39,912 - - - - 239,912
Miscellaneous 2 5,405 - - - - - - - 25,405
Total Operating Expenses 2 07,545 - - 2 39,912 1 ,984,719 3,870 - - 2,436,046
OPERATING INCOME ( LOSS) 4 5,982 - 9 08,871 3 1,000 ( 159,045) 173,316 1,984 5,256 1,007,364
NONOPERATING REVENUES ( EXPENSES):
Investment earnings - - - - 1 3 - 189 222 424
Total Nonoperating Revenues ( Expenses) - - - - 1 3 - 189 222 424
INCOME ( LOSS) BEFORE TRANSFERS 4 5,982 - 9 08,871 3 1,000 ( 159,032) 173,316 2,173 5,478 1,007,788
TRANSFERS:
Transfers in 1 0,685 - - - - - - - 10,685
Transfers ( out) ( 934,135) - ( 120,081) - - - - - ( 1,054,216)
CHANGES IN NET ASSETS ( 877,468) - 7 88,790 3 1,000 ( 159,032) 173,316 2,173 5,478 ( 35,743)
NET ASSETS - BEG