LAFCO

Bombay Beach Community Service District Service Area Plan

Local Agency Formation Commissions · imperial-msr-2016-bombay-beach-community-service-district-service-area-plan · Msr · 2016-01-01

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EXECUTIVE OFFICER'S REPORT To The Local Agency Formation Commission TO: Commissioner MARIA NAVA-FROELICH [City] Commissioner MICHAEL KELLEY(Chair) [Supervisor] Commissioner JASON JACKSON [City] Commissioner RAY CASTILLO [Supervisor] Commissioner DAVID WEST (Vice-Chair) [Public] Alt Commissioner JACK TERRAZAS [Supervisor] Alt Commissioner JIM PREDMORE [City] Alt Commissioner RALPH MENVIELLE [Public] REPORT DATE: May 1, 2016 FROM: Jurg Heuberger, AICP, CEP, Executive Officer PROJECT: Bombay Beach Community Service (BBCSD) District Sphere of Influence (SOI) update and Service Area Plan (SAP)/Municipal Services Review (MSR) HEARING DATE: May 26, 2016 TIME: 9:10 AM AGENDA ITEM NO: 17 HEARING LOCATION: El Centro City Council Chambers, 1275 Main Street, El Centro, CA RECOMMENDATION(S) EXECUTIVE OFFICER BY THE (In Summary & Order) OPTION #1: Approve the proposed Sphere of Influence (SOI) and the Service Area Plan/MSR update as presented by the Executive Officer. OPTION #2: Approve the proposed Sphere of Influence (SOI) and Service Area Plan/MSR update as requested with modifications, following the hearing by the Commission. OPTION # 3: Continue the hearing for not to exceed 70 days, (end date August 15, 2016). OPTION # 4: Deny the Sphere of Influence and Service Area Plan update, and provide direction to the District and EO for corrections. Project Data: DATA & FACTS: Project ID BBSCD 1-16 Project Name: Bombay Beach Community Service District Sphere of Influence and Service Area Plan Update (SAP)/MSR Applicant/Proponent: Bombay Beach Community Service District Application Type: LAFCO requested update Application Filed: N/A (LAFCO Direction) Certificate of Filing: N/A Area/Size: See Plan Location/Legal: Maps of the District Boundary and the SOI are included in this report. Population: NA Proposed Project: Service Area Plan (SAP) / Municipal Services Review (MSR) Update. MSR/SAP: The most recent version of the Bombay Beach Community Service District MSR/SAP is 2006. TAX AGREEMENT: Board of Supervisors Action: N/A City Resolution: N/A (will be required upon notification by LAFCO) Tax Split: N/A CEQA: Lead Agency: LAFCO Documentation: Exempt S: LAFCO Executive Officer Reports 2016 05 26 16 Hearing EO Reports EO Report Bombay Community Service District SAP Update 5 1 16 doex ANALYSIS l: Legal Requirements (Historical information): Cortese-Knox-Hertzberg Reorganization Act of 2000 (CKH), also referred to as Government Code 56000 et Seq., provides the legal basis for the requirement of the Sphere of Influence and the Service Area Plan or Municipal service Review (MSR) being considered within the scope of this hearing. G.C. § 56425 (a) states in part; "In order to carry out its purposes and responsibilities for planning and shaping the logical and orderly development and coordination of local governmental agencies so as to advantageously provide for the present and future needs of the county and its communities, the commission shall develop and determine the sphere of influence of each local governmental agency with the county and enact policies designed to promote the logical and orderly development of areas within the sphere." G.C. § 56425 (b - i) provide the frame work within which the Commission may approve the sphere of influence and the process that needs to be followed. G.C. § 56425 (e) states in part; "In determining the sphere of influence of each local agency, the commission shall consider and prepare a written statement of its determination with respect to each of the following: The present and planned land uses in the area. (1) (2) The present and probable need for public facilities and services in the area. (3) The present capacity of public facilities and adequacy of public services that the agency provides or is authorized to provide. The existence of any social or economic communities' of interest in the area if the commission (4) determines that they are relevant to the agency. G.C. § 56425 (f) is a critical new section that changed the parameters of the prior review insofar that this section now requires that; "Upon determination of a sphere of influence, the commission shall adopt that sphere, and shall review and update, as necessary, the adopted sphere not less than once every five years". There appears to be a misconception that the agencies will have to prepare a full new plan every five years, however the intent here is to "review" the prior plan and to amend it if necessary. If there have been significant changes, or if there has been explosive growth, then certainly the amendment will be much more comprehensive. G.C. § 56428 (a) provides the mechanism for anyone to file a request with the executive officer for an amendment to the sphere of influence. It states in part; "Any person or local agency may file a written request with the Executive Officer requesting amendments to a sphere of influence or urban service area adopted by the commission..." Again there may be some confusion in this area as there have been numerous questions about the "limitations" of the sphere and the process to amend. It appears clear that the mandate is to review the plan at least every five years but there is no apparent restriction on the number of times that it may be amended nor is there a restriction on who can request such an amendment, there is only a process that needs to be followed. It goes without saying however that for an amendment to work it need the consensus of the City/District, the County and the Commission. Just as there are provisions for the addition of areas to a sphere of influence there are provisions for a process to remove an area from an approved sphere boundary. This is found in G.C. 56429. In addition to the SOI process G.C. § 56430 (a - d) now addresses the requirement for the review of municipal services which in our case has been referred to for nearly a decade as the Service Area Plan (SAP). S: LAFCO Executive Officer Reports 2016/05 26 16 Hearing EO Reports EO Report Bombay Community Service District SAP Update 5 1 16.docx G.C. § 56430 (a) states; "In order to prepare and to update spheres of influence in accordance with Section 56425, the Commission shall conduct a service review of the municipal services provide in the county or other appropriate area designated by the commission. The commission shall include in the area designated for service review the county, the region, the sub region, or any other geographic area as its appropriate for an analysis of the service or service to be reviewed and shall prepare a written statement of its determination with respect to each of the following: 1) Infrastructure needs or deficiencies. 2) Growth and population projections for the affected area. 3) Financing constraints and opportunities. 4) Cost avoidance opportunities. 5) Opportunities for rate restructuring. 6) Opportunities for shared facilities 7) Governmental structure options, including advantages and disadvantages of consolidation or reorganization of service providers. 8) Evaluation of management efficiencies 9) Local accountability and governance." G.C. § 56430 (d) also required that the Office of Planning and Research of the State, in consultation with the commissions, and the California Association of LAFCO's and other governmental agencies, SHALL prepare a comprehensive set of guidelines for service reviews by July 1, 2001. Since these guidelines are voluminous a full text copy is not attached to the report however there is a PDF copy on the CD rom that has been provided to each commissioner and every interested party. Furthermore, the Executive Officer has urged the various entities to utilize the "draft final" version as a guide to preparing the SOI and SAP. II: The PLAN as submitted: The District is a Community Service District that provides specific services to a very small area within Imperial County, primarily the town site of Bombay Beach. The review in this case as is/was the case in a number of other smaller districts pursuant to the direction of LAFCO focused primarily on the financial viability of the District. Insofar as this is a limited purpose District the services provided appear to be and have been provided adequately for the most part. The financials for the District as per the attached also show that it is financially stable. III: District Approvals: The District will need to accept the LAFCO approval of the SOI/MSR/SAP via a resolution to include any and all recommendations. IV: CEQA: It is argued and it is the Executive Officers opinion that the Service Area Plan fit within one or more "exemptions" under the provisions of CEQA, not the least of which is the possible determination that this process is "not a project". S:\LAFCO\Executive Officer Reports\2016\05\26\16\Hearing EO Reports\EO Report Bombay Community Service District SAP Update 5\116.doex V: Analysis by the Executive Officer / Determinations by the COMMISSION: G.C. § 56425 (e) states in part; "In determining the sphere of influence of each local agency, the Commission shall consider and prepare a written statement of its determination with respect to each of the following: (1) The present and planned land uses in the area. (2) The present and probable need for public facilities and services in the area. (3) The present capacity of public facilities and adequacy of public services that the agency provides or is authorized to provide. The existence of any social or economic communities of interest in the area if the commission (4) determines that they are relevant to the agency. Proposed findings by the Commission: 1) The present land use within the boundaries of the proposed SOI/SAP includes residential, some commercial but little or no industrial. The District provides limited service. 2) Currently the services provided are according to the audited financial information being supplied in a financially stable and adequate manner. (See audited financial information attached). 3) There are no known social or economic communities of interest relevant to this review. VI: Public Notice: Public notice for the proposed project hearing before the Imperial County Local Agency Formation Commission has been given, according to Section § 56427. Notice was issued in the form of a publication in the IV Press at least twenty-one (21) days prior or said hearing, and posted on our webpage. VII: Report: In accordance with Section § 56665, the Executive Officer has prepared a report, and presented said report to your Commission and to any public member requesting such report. In addition, a copy of said report has been issued to the Bombay Beach Community Service District and any party requesting a copy. VIII: Conflict of Interest Statement: To date (at the writing of this report, May 1, 2016) no Commissioner has indicated that there is any conflict of interest with regard to this project, nor has any Commissioner reported any communications with the Applicant, Proponent or Opponent. The Commissioners will be asked to declare that during and prior to the public hearing. The Executive Officer does not have any type of known conflict of interest or financial gain as a result of this project and owns no property in the vicinity. 8: LAFCO: Executive Officer Reports/2016/05 26 16 Hearing EO Reports/EO Report Bombay Community Service District SAP Update 5 1 16.docx EXECUTIVE OFFICERS RECOMMENDATION RECOMMENDATION: It is the recommendation of the Executive Officer that LAFCO conduct a public hearing and consider all information presented in both written and oral form. The Executive Officer then recommends, assuming no significant public input warrants to the contrary, that LAFCO take the following action; 1: Certify that the Service Area Plan is exempt from CEQA. 11: Make the finding that this Sphere of Influence and Service Area Plan (SAP)/ Municipal Service Review (MSR) is in substantial compliance with the provisions of the Cortese-Knox-Hertzberg Reorganization Act of 2000 and the Imperial LAFCO Policy and Procedures. 111: Make the findings pursuant to Government Code Section § 56425 that: a. The Service Area Plan has been reviewed by the Executive Officer and the Commission and the District has the capacity and ability to provide services within the area. b. The Service Area Plan for the District shows it to be operating its service in a financially sound manner. The Sphere of Influence currently adopted remains adequate for the District and no annexations or C. changes to the boundary have occurred since the prior SAP review. IV: The Commission finds that, the present land uses within the boundaries of the District are predominately agricultural with urban and the services are strictly for providing limited services, currently authorized to be provided are, wastewater collection/treatment, fire protection & recreation. The Commission finds that, there are no known social or economic communities of interest in the areas. V: Since there have been no protests received, the Commission adopts and approves the current Sphere of Influence Boundary as previously reviewed and approved. LAFCO Policy: The proposed Sphere of Influence and Service Area Plan appears to be consistent with the Cortese-Knox- Hertzberg Reorganization Act of 2000, the Imperial LAFCO Policies and Procedures and the County of Imperial General Plan (Chapter IV. B. of LAFCO's Policies, Standards and Procedures). Furthermore, the District has (according to the Service Area Plan) the ability to supply the necessary public service, and has assured LAFCO that it has the capacity to service the areas. NOTE: All "cc" submittals are the Executive Officer's Report only. Attachments are generally too voluminous and are only supplied on CD. Information about the project may also be found on the LAFCO web page at www.iclafco.com. CC: Bombay Community Service District ATTACHMENTS: EXHIBIT A - Audited Financial Information EXHIBIT B - Current Sphere of Influence Boundary Map S: LAFCO: Executive Officer Reports 2016:05 26 16 Hearing EO Reports EO Report Bombay Community Service District SAP Update 5 1 16,doex EXHIBIT A Audited Financial Information BBCSD 1-16 . ۷ ж. te. RECEIVE į. APR 12 2016 Local Agency Formation Commission BOMBAY BEACH COMMUNITY SERVICES DISTRICT FINANCIAL STATEMENTS (WITH INDEPENDENT AUDITOR'S REPORT) AS OF AND FOR THE YEAR ENDED JUNE 30, 2014 Ħ. George J. Woo Certified Public Accountant INDEPENDENT AUDITOR'S REPORT To the Board of Directors Bombay Beach Community Services District Niland, California 92257 i have audited the accompanying financial statements of Bombay Beach Community Services District, as of and for the year ended June 30, 2014, and the related notes to the financial statements, which collectively compromise the financial statements. Management's Responsibility for the Financial Statements Management is responsible for the preparation and fair presentation of these financial statements in accordance with accounting principles generally accepted in the United States of America; this includes the design, implementation, and maintenance of internal control relevant to the preparation and fair presentation of financial statements that are free from material misstatement, whether due to fraud or error. Auditor's Responsibility My responsibility is to express an opinion on these financial statements based on my audit. I conducted the audit in accordance with auditing standards generally accepted in the United States of America and the State Controller's minimum audit requirements for California Special District. Those standards require that I plan and perform the audit to obtain reasonable assurance about whether the financial statements are free from material misstatement. An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the financial statements. The procedures selected depend on the auditor's judgment, including the assessment of the risks of material misstatement of the financial statements, whether due to fraud or error. In making those risk assessments, the auditor considers internal control relevant to the entity's preparation and fair presentation of the financial statements in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion the effectiveness of the entity's internal control. Accordingly I express no such opinion. An audit also includes evaluating the appropriateness of accounting policies sed and the reasonableness of significant accounting estimates made by management, as well as evaluating the overall presentation of the financial statements. ! believe that the audit evidence I have obtained is sufficient and appropriate to provide a basis for my audit opinion. 23 1 2 3 37-5555 • Fax 337-8796 E-mail address gjwcpa@sbcglobal.net Opinion In my opinion, the financial statements referred to above present fairly, in all material respects, the financial position of the governmental and business type activities of Bombay Beach Community Services District as of June 30, 2014, and the changes in financial position and cash flows thereof for the year then ended in accordance with accounting principles generally accepted in the United States of America as well as accounting systems prescribed by the State Controller's Office and state regulations governing special districts. Required Supplementary Information Accounting principles generally accepted in the Unites States of America require that the Management's Discussion and Analysis on pages 3 through 9 be presented to supplement the basic financial statements. Such information, although not a part of the basic financial statements, is required by the Governmental Accounting Standards Board, who considers it to be an essential part of the financial reporting for placing the basic financial statements in an appropriate operational, economic, or historical context. I have applied certain limited procedures to the required supplementary information in accordance with auditing standards generally accepted in the United States of America, which consisted of inquiries of management about the methods of preparing the information and comparing the information for consistency with management's responses to my inquiries, the basic financial statements, and other knowledge I obtained during my audit of the basic financial statements. I do not express an opinion or provide any assurance on the information because the limited procedures do not provide us with sufficient evidence to express an opinion or provide any assurance. you I was November 10, 2014 No. 19 Sept. 1 Sept. 1 Sept. 1 Sept. 1 Sept. 1 Sept. 1 Sept. 1 Sept. 1 Sept. 1 Sept. 1 Sept. 1 Sept. 1 Sept. 1 Sept. 1 Sept. 1 Sept. 1 Sept. 1 Sept. 1 Sept. 1 Sept. 1 Sept. 1 Sept. 1 Sept. 1 Sept. 1 Sept. 1 Sept. 1 Sept. 1 MANAGEMENT'S DISCUSSION AND ANALYSIS FOR THE YEAR ENDED JUNE 30, 2014 The discussion and analysis of the financial performance of the Bombay Beach Community Services District (the "District") provides an overview of the District's financial activities for the year ended June 30, 2014. The intent of this discussion and analysis is to look at the District's financial performance as a whole; users of these financial statements should read this discussion. Financial Highlights The assets of the District exceeded its liabilities at the close of the 2013-2014 fiscal year $ 207,015 (Net Assets) and $ 203,815 in Unrestricted Net Assets. The District's net assets from governmental activities decreased by $ 1,100, net assets from proprietary activities increased by $ 19,416 during the current fiscal year. As of June 30, 2014, the District's governmental funds reported total ending fund balance of $ 1,395, a decrease of 44% in comparison with the prior year. $ 1,395 is available for spending. Overview of the Financial Statements The Discussion and analysis is intended to serve as an introduction to the District's basic financial statements. These statements are organized so that readers can understand the District as a financial whole or as an entire operating entity. The District's basic financial statements are comprised of three components: 1) Government-wide financial statements 2) Fund financial statements and 3) Notes to the financial statements. This report also contains other supplementary information in addition to the financial statements themselves. 1. Government-wide Financial Statements The government-wide financial statements are designed to provide readers with a broad overview of the District's finances, in a manner similar to a private-sector business. The Statement of Net Assets presents information on all of the Districts assets and liabilities, with the difference between the two reported as net assets. Over time, increases and decreases in net assets may serve as a useful indicator of whether the financial position of the District is improving or deteriorating. MANAGEMENT'S DISCUSSION AND ANALYSIS FOR THE YEAR ENDED JUNE 30, 2014 The statement of activities presents information showing how the Districts net assets changed during the most recent fiscal year. All changes in net assets are reported as soon as the underlying event takes place regardless of when cash is received or paid. Thus, some revenues and expenses are reported in this statement that will only result in cash inflows and outflows in future fiscal years. Both the Statement of Net Assets and the Statement of Activities distinguishes between activities that are primarily financed with taxes and revenues (governmental activities). These financial statements are presented on pages 10 and 11 on this report. 2. Fund Financial Statements The fund financial statements provide detailed information about the most significant funds - not the District as a whole. A fund is a fiscal and accounting entity designated to report information about groupings of related accounts which are used to maintain control over resources that have been segregated for specific activities or attaining certain objectives in accordance with specific regulations, restrictions or limitations. All of the District's funds can be divided into two categories: governmental funds and proprietary funds. Governmental funds are used to account for activities that are similar in nature to the governmental activities in the government-wide financial statements. However, unlike the government wide financial statements, the governmental fund financial statements focus on near-term inflows and outflows of spendable resources, as well as on balances of spendable resource available at the end of the fiscal year. Such information may be used in evaluating the District near-term financing requirements and available resources. Because the focus of governmental funds is narrower than that of the government- wide financial statements, it is useful to compare the information presented for governmental funds with similar information presented for governmental activities in the government-wide financial statements. This will allow readers to get a better understanding of the long-term impact of the government's near-term financing decisions. Both the governmental fund balance sheet and the governmental fund statement of revenues, expenditures and changes in fund balances provide a reconciliation to facilitate this comparison between governmental funds and governmental activities. The basic governmental fund financial statements and the government-wide financial statements are presented on pages 10 through 14 of this report. Proprietary funds are reported as enterprise funds. Enterprise funds are reported as functions presented as business-type activities in the government-wide financial statements. The district used enterprise funds to account for the Community Fund MANAGEMENT'S DISCUSSION AND ANALYSIS FOR THE YEAR ENDED JUNE 30, 2014 (lease), Community Center (pancake breakfast) and Bombay North (savings and rentals). Proprietary funds provide the same type of information as the government-wide financial statements, only in more detail. The proprietary fund financial statements provide separate information for the Community Fund (lease), Community Center (pancake breakfast) and Bombay North (savings and rentals). The basic proprietary fund financial statements are presented on pages 15 through 17 of this report. 3. Notes to the Financial Statements The notes provide additional information that is essential to a full understanding of the data provided in both government-wide and fund financial statements. The notes to the financial statements are presented on pages 18 through 23 of this report. Government-wide Financial Analysis As noted earlier, net assets may serve over time as a useful indicator of a government's financial position. In the case of the District, assets exceeded liabilities $ 267,037 (see table 1) at the close of the current fiscal year. A portion of the Districts net assets, $ 61,827, reflects its investments in capital assets (e.g. land, structures and improvements, vehicles, furniture and equipment), less any related outstanding debt used to acquire those assets. The District uses these capital assets to provide services to citizens; consequently, these assets are not available for future spending. The remaining balance of total net assets is comprised of unrestricted net assets of $ 205,210 and restricted net assets for impress cash in the amount of $ 100. At the end of the current fiscal year, the District as a whole and for its governmental activities reported positive balances in net assets. and the first of the control of the control of the control of the control of the control of the control of the control of the control of the control of the control of the control of the control of the control of the contro ŀ MANAGEMENT'S DISCUSSION AND ANALYSIS FOR THE YEAR ENDED JUNE 30, 2014 Table 1 - District's Net Assets Governmental Activities For the Years Ended June 30, 2014 and 2013 2013 2014 1,395 2,495 Current Assets and Other Assets 58,627 58,627 Non current assets 60,022 61,122 Total Assets Current and Other Liabilities -0- -0- Total Liabilities -0- -0- Net Assets Invested in Capital Assets, Net of 58,627 58,627 accumulated depreciation 100 100 Restricted 1,295 2,395 Unrestricted 60,022 Total Net Assets 61,122 $ Table 1 - District's Net Assets Business Type Activities For the Years Ended June 30, 2014 and 2013 2014 2013 Current Assets and Other Assets 205,840 179,774 S S 3,200 8,375 Non current assets 209,040 188,149 Total Assets 2,025 Current and Other Liabilities 550 Total Liabilities 2,025 550 Net Assets Invested in Capital Assets, Net of 3,200 8,000 accumulated depreciation Restricted -0- -0- Unrestricted 203,815 179,599 207,015 Total Net Assets 187,599 S MANAGEMENT'S DISCUSSION AND ANALYSIS FOR THE YEAR ENDED JUNE 30, 2014 As shown in Table 2, the District's net assets increased by $ 18,316 during the current fiscal year. Table 2 - District's Changes in Net Assets Governmental Activities For the Years Ended June 30, 2014 and 2013 2013 2014 Revenues Program Revenues $ $ -0- -0- Charges for Services General Revenues 3,996 3,622 Property Taxes 10 14 Interest 3,632 4,010 Total Revenue Expenses 331 -0- Other administration 4.189 4,401 Utilities 4,732 4,189 Total Expenses (1.100) (179) Increase (decrease) in Net Assets $ District's Changes In Net Assets Business Type Activities For the Years Ended June 30, 2014 and 2013 2014 2013 Revenues Program Revenues $ 47,829 Charges for Services $ 51,475 General Revenues 400 663 Interest 1.000 Donations 1,362 Total Revenue 49,591 53,138 Expenses 24,387 Material and Supplies 25,375 Depreciation 4,800 4,800 Total Expenses 30,175 29,187 Increase in Net Assets 19,416 23,951 $ MANAGEMENT'S DISCUSSION AND ANALYSIS FOR THE YEAR ENDED JUNE 30, 2014 Governmental Activities Governmental activities decreased the District's net assets by $ 1,100 for the fiscal year ended June 30, 2014. Business Activities Business activities increased the District's net assets by $ 19,416 for the fiscal year ended June 30, 2014. Budgetary Analysis Budget to actual analysis provides the reader with useful information regarding the District's use of budgets and a sense of what management was attempting to achieve during the year. Budget to actual comparisons can be found on page 26. Table 3 District's Capital Assets (Net of Accumulated Depreciation) Governmental Activities For the Years Ended June 30, 2014 and 2013 2014 2013 -0- Building and structures S $ -0- Land 58.627 58,627 Total 58,627 58.627 District's Capital Assets (Net of Accumulated Depreciation) Business Type Activities For the Years Ended June 30, 2014 and 2013 2014 2013 3,200 8,000 Building and structures -0- Land -0- 3,200 8,000 Total $ MANAGEMENT'S DISCUSSION AND ANALYSIS FOR THE YEAR ENDED JUNE 30, 2014 Requests for Information This financial report is designed to provide our citizens, taxpayers, creditors and investors with a general overview of the District's finances and to demonstrate the District's accountability for the money it receives. If you have any questions about this report or need additional financial information, you may contact Mr. Frank Raymond at (760) 354-1351. Written requests for information should be addressed to the Office of the Secretary, 9590 Avenue "C", Niland, CA 92257. FINANCIAL SECTION -6 STATEMENT OF NET ASSETS AS OF JUNE 30, 2014 Governmental Business Activities Type Activities Total ASSETS Cash 1,395 205,840 $ $ 207,235 $ Accounts receivable -0- -0- -0- Inventory -0- -0- -0- Capital assets, net of accumulated depreciation 58,627 3,200 61,827 Total Assets 60,022 $ 209,040 $ $ 269,062 LIABILITIES AND NET ASSETS LIABILITIES Accounts payable $ 2,025 -0- $ $ 2,025 Total Liabilities 2,025 $ $ 2,025 S -0- NET ASSETS Investments in capital assets net of related debt and accumulated depreciation 58,627 $ 3,200 $ $ 61,827 Unrestricted 1,395 203,815 205,210 Total net assets 60,022 207,015 $ $ $ 267,037 The notes to financial statements are an integral part of these statements. STATEMENT OF ACTIVITIES FOR THE FISCAL YEAR ENDED JUNE 30, 2014 Business - Type Charges for Governmental Total Activities Activities Services Expenses Governmental Activities (4,732) (4,732) $ -0- Materials and Supplies 4,732 -0- $ $ -0- (4,732) (4,732) -0- Total Governmental activities 4,732 Business Activities 16,505 16,505 -0- 26,941 43,446 Community Fund (2,151) -0- (2,151) 1,083 3,234 Community Center 3,300 3,300 3,300 -0- Bombay Beach North -0- 17,654 -0- 17,654 30,175 47,829 Total Business Activities 12,922 (4,732) $ 17,654 $ 47,829 $ 34,907 $ Total primary government $ General Revenues 1,362 1,362 -0- Donations 3,622 -0- 3,622 Property Taxes 400 410 10 Interest income 1,762 5,394 3,632 Total general revenues 19,416 18,316 (1,100) Change in Net Assets 248,721 61,122 187,599 Fund Balance July 1, 2013 207,015 $ 267,037 60,022 $ Fund Balance June 30, 2014 $ The notes to financial statements are an integral part of these statements BALANCE SHEET GOVERNMENTAL FUND AS OF JUNE 30, 2014 ASSETS 1,395 $ Jast Total assets $ 1,395 LIABILITIES AND FUND BALANCE Labilities Accounts Payable $ -0- Total Liabilities -0- Fund Balances Reserve for imprest cash 100 Fund balance - unreserved 1,295 Total fund balances 1,395 Liabilities and Fund Balances 1,395 $ The notes to financial statements are an integral part of these statements RECONCILIATION OF THE BALANCE SHEET OF GOVERNMENTAL FUND TO THE STATEMENT OF NET ASSETS AS OF JUNE 30, 2014 Amounts reported for Governmental Activities in the Statements of Net Assets are different because: Total Fund Balance - Governmental Fund $ 1,395 Capital assets used in governmental activities are not financial resources and, therefore are not reported in the funds. The cost of assets is $ 494,046 and accumulated depreciation is $ 435,419. 58,627 Total Net Assets - Governmental Activities 60,022 The notes to financial statements are an integral part of these statements. COMBINED STATEMENT OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCES - ALL GOVERNMENTAL FUND TYPES FOR THE YEAR ENDED JUNE 30, 2014 General Fund REVENUES 3,622 Property Taxes $ Interest Earnings 10 3,632 Total Revenues EXPENDITURES 331 Other administration Utilities 4,401 Total Expenditures 4,732 Excess of revenue over (under) (1,100) expenditures Fund Balance July 1, 2013 2,495 Fund Balance June 30, 2014 $ 1,395 The notes to financial statements are an integral part of these statements. COMBINED STATEMENT OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCES - BUDGET AND ACTUAL - GENERAL FUND FOR THE YEAR ENDED JUNE 30, 2014 Variance General Favorable Budget Fund (Unfavorable) Revenues 3,622 Property taxes 5,350 (1,728) S $ $ Interest 50 10 (40) 3,632 5,400 (1,768) Expenditures Other administration 1,000 331 669 Utilities 4,400 4,401 (1) 5,400 4,732 668 Excess of revenue over expenditures (1,110) -0- (1,110) Fund Balance July 1, 2013 2,495 2,495 -0- Fund Balance June 30, 2014 2,495 $ $ 1,385 $ (1,110) The notes to financial statements are an integral part of these statements STATEMENT OF ACTIVITIES - PROPRIETARY FUND TYPES FOR THE FISCAL YEAR ENDED JUNE 30, 2014 Community Bombay Fund Beach North Total -SSETS Current Assets Cash $ 152,282 53,558 $ $ 205,840 Accounts receivable -0- -0- -0- In entory -0- -0- -0- Total Current Assets 152,282 53,558 205,840 Non Current Assets Capital Assets 24,000 24,000 -0- Accumulated depreciation (20,800) -0- (20,800) Total Non Current Assets 3,200 3,200 -0- Total Assest $ 155,482 53,558 $ 209,040 $ LAB LITIES Accounts payable 1,475 $ 550 5 $ 2,025 MET ASSETS investments in capital assets net of accumulated depreciation 3,200 -0- 3,200 Unrestricted 150,807 53,008 203,815 Total net assets $ 154,007 53,008 $ $ 207,015 The notes to financial statements are an integral part of these statements STATEMENT OF REVENUES, EXPENDITURES AND CHANGES IN NET ASSETS - PROPRIETARY FUND TYPES FOR THE YEAR ENDED JUNE 30, 2014 Community Community Bombay Fund Center Beach North TOTAL Derating Revenues iges for services 43,446 1,083 $ $ 3,300 $ 47,829 Total Operating revenues 43,446 1,083 3,300 47,829 Operating Expenditures Dignations 1,780 862 -0- 2.642 Dues 120 -0- -0- 120 mes 5,135 -0- -0- 5,135 ce Expense 773 -0- -0- 773 Murance 3,005 -0- -0- 3,005 Legal & Accounting 7,650 -0- -0- 7,650 Repairs and Maintainance 992 3.605 -0- 4,597 Community Breakfast 15 1,380 -0- 1,395 Supplies 58 -0- -0- 58 Decreciation 4,800 -0- -0- 4,800 Total operating expenses 26,941 3,234 -0- 30,175 Operating income 16,505 3,300 (2,151) 17,654 Mon Operating Revenues Donations 862 500 -0- 1,362 interest income 164 -0- 236 400 Total non operating revenue 1,026 500 236 1,762 Change in net assets 17,531 (1,651) 3,536 19,416 Met Assets July 1, 2013 136,476 1,651 49,472 187,599 Met Assets June 30, 2014 154,007 $ $ -0- $ 53,008 $ 207,015 The notes to financial statements are an integral part of these statements STATEMENT OF CASH FLOWS - PROPRIETARY FUND TYPES FOR THE YEAR ENDED JUNE 30, 2014 Flows from Operating Activities Cash received from users 753 $ Cash received from leases 47,076 Dash received from donations 1,362 Cash paid to suppliers (23,525) Cash Provided by Operating Activities 25,666 Rows from Investing Activities merest payments received 400 $ medicash provided by investing activities 400 Flows from Capital and Related Financing Activities Equipment Purchase -0- make in Cash and Cash Equivalents 26,066 and Cash Equivalents - Beginning of Year 179,774 and Cash Equivalents - End of Year $ 205,840 Flows from Operating Activities Operating Income 19,416 $ Adjustments to Reconcile Net Income Met Cash Activities: Depreciation 4,800 increase (decrease) in: Accounts receivable -0- Accounts payable 1475 Inventory 375 Provided by Operating Activities 26,066 $ The notes to financial statements are an integral part of these statements NOTES TO FINANCIAL STATEMENTS JUNE 30, 2014 NOTE 1. SIGNIFICANT ACCOUNTING POLICIES General The Bombay Beach Community Services District (the District) was formed August 11, 1961 The District was formed to provide services for the Bombay Beach Community. The District is governed by a Board of Directors consisting of five members who are elected or appointed for a four year term. Government-wide Financial Statements The statement of net assets and statement of activities display information about the primary government (the District). These statements include the financial activities of the overall government. The statement of activities presents a comparison between direct expenses and program revenues for the District's proprietary 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 1) charges paid by the recipients of goods or services offered by the programs and 2) contributions that are restricted to meeting the operational or capital requirements of a particular program. Revenues that are not classified as program revenues, including all taxes, are presented instead as general revenues. When both restricted and unrestricted net assets are available, restricted resources are used only after the unrestricted resources are depleted. Fund Accounting The accounts of the District are organized on the basis of funds. Governmental Fund The General Fund is the general operating fund of the District. It is used to account for all financial resources except those required to be accounted for in another fund. Proprietary Funds Proprietary Funds are used to account for operations which are financed and operated in a manner similar to private business enterprises, where the intent of the governing body is that the costs of providing goods or services to the general public on a continuing basis be financed or recovered primarily through user charges. NOTES TO FINANCIAL STATEMENTS JUNE 30, 2014 SIGNIFICANT ACCOUNTING POLICIES (Continued) NOTE 1. Proprietary Funds (Continued) The District has two proprietary funds whose net asset balances as of June 30, 2014, were: $ 154,007 The Community Fund 53,008 Bombay Beach North $ 207,015 The Community Fund accounts for the income and expenses of the community building and cellular tower. The Community Fund also accounts for the Memorial Fund and Park. The Community Center Fund accounted for the income and expenses of the monthly pancake breakfast. Income from the breakfast was used to support the cost of maintaining the community building in part. This community service was transferred to the community fund during the current fiscal year. The Bombay Beach North Fund accounts for the income and expenses of Bombay Beach North. Income from rent on a sign located on this land and rent from a building is used to support the cost of the land. Basis of Accounting The accounting records are maintained on the modified accrual basis of accounting. Revenues are recognized when they become measurable and available as net current assets. Expenditures are recognized when the related fund liability is incurred. Cash Cash is considered to be cash on hand and cash in bank. All short-term investments that are highly liquid are considered to be cash equivalents. Cash equivalents are readily convertible to known amounts of cash, and at the day of purchase have an original maturity of three months or less. Cash in the treasury is held by the District at the Imperial County Treasurer's office. Demands are required to draw money to pay accounts payable. The District treasury pays interest on funds held. NOTES TO FINANCIAL STATEMENTS JUNE 30, 2014 NOTE 1. SIGNIFICANT ACCOUNTING POLICIES (Continued) Budgets The District prepares a budget for the General Fund. Upon adoption by the Board of Directors, the budget is filed with the Board of Supervisors of the County of Imperial. Budgets are not prepared for the Proprietary Funds. All appropriations lapse at year end. Principles Determining Scope of Reporting Entity The financial statements consist only of the funds of the District. The District has not oversight responsibility for any other governmental entity since no other entities are considered to be controlled or dependent on the District. Capital Assets Capital assets, including infrastructure, are recorded at historical costs or at estimated historical cost if historical cost is not available. Contributed fixed assets are valued at their estimated fair market value on the date contributed. Capital assets include public domain (infrastructure) general fixed assets, which consist of certain improvement including roads, bridges, pavements in progress, and right of way. The District defines capital assets as assets with individual costs of more than $ 2,500 and an estimated useful life in excess of one year. Capital assets used in operations are depreciated or amortized (assets under capital leases) using the straight-line method over the lesser of the capital lease period or their estimated useful lives in the government-wide statements and proprietary funds. Maintenance and repairs are charged to operations when incurred. Betterments and major improvements which significantly increase values, change capacities or extend useful lives are capitalized. Upon sale or retirement of fixed assets, the cost and related accumulated depreciation are removed form the respective accounts and any resulting gain or loss is included in the results of operations. The estimated useful lives are as follows: Buildings 40 years Equipment 5-15 years Office furniture 5 years Property Improvements 7 years NOTES TO FINANCIAL STATEMENTS JUNE 30, 2014 NOTE 2. RISK MANAGEMENT The District is exposed to various risks of loss related to torts; theft of, damage to and destruction of assets; errors and omissions; and natural disasters for which the District carries commercial insurance. NOTE 3. DEPOSITS AND INVESTMENTS California Government Code 53601 authorizes the District to invest in obligations of the U.S. Treasury or its agencies, obligations of the State of California and any local agency, corporate bonds rated AAA by Standard and Poor, certificates of deposit or other interest bearing deposits of insured financial institutions and other investments as my be allowed by law. Deposits - At year-end, the carrying amount of the District's deposits was $ 205,840 and the bank balance was $ 208,303. The bank balance is classified into three categories of credit risk: 1. Insured or collateralized with securities held by the District or by its agent in the District's name. 2. Collateralized with securities held by the pledging financial institution's trust department or agent in the District's name. 3. Uncollateralized. (This includes any bank balance that is collateralized with securities held by their pledging financial institution, or by its trust department or agent but not in the District's name.) Classification of Bank Balance by Credit Risk: Categories Total Deposits $ 208,303 208,303 Investments - The District's investments are classified into three categories of credit risk: 1. Insured or registered, or securities held by the District or its agent in the District's name. 2. Uninsured and unregistered, with securities held by the counterparty's trust department or agent in the District's name. NOTES TO FINANCIAL STATEMENTS JUNE 30, 2014 DEPOSITS AND INVESTMENTS (Continued) NOTE 3 3. Uninsured and unregistered, with securities held by the counterparty, or by its trust department or agent but not in the District's name. Classification of investments by credit risk: Categories Fair Carrying Value Amount_ District Investment $ 1,295 $ 1.295 $ -0- $-0- $_ -0- Pool (uncategorized) EXTERNAL INVESTMENT POOLS NOTE 4. The District is considered a member of an external investment pool. The Treasurer of Imperial County received funds from the District and pools them with other funds and invests these funds in a variety of instruments including Certificates of Deposit and Government Agency Funds. The funds are recorded at fair value. Interest is allocated to the District based on their pro rata share of the total amount invested in the pool. NOTE 5. CAPITAL ASSETS Capital assets for the Governmental Fund, for the year ended June 30, 2014 is summarized as follows: $ 58,627 Land 418,614 Building and Improvements 16,785 Equipment $ 494,026 (435, 399) Less Accumulated Depreciation 58,627 Total Capital Assets Structures and improvements for the Proprietary Funds, for the year ended June 30, 2014, is summarized as follows: 24,000 Equipment 3,037 Structures and improvements 27,037 (23,837) Less accumulated depreciation 3,200 Total capital assets NOTES TO FINANCIAL STATEMENTS JUNE 30, 2014 SUBSEQUENT EVENTS NOTE 6. The management of the district have reviewed the results of operations for the period of time from its year end June 30, 2014 through November 10, 2014 the date the combined financial statements were available to be issued, and have determined that no adjustments are necessary to the amounts reported in the accompanying combined financial statements nor have any subsequent events occurred, the nature of which would require disclosure. EXHIBIT B Current Sphere of Influence Boundary Map BBCSD 1-16 10 C ଖ 17 16 15 18 22 ----- 20 21 19 HEHEL STATE HIGHEN 200 · 27 BE I. 31 32 Bombay Beach Community Service District local agency formation commission EXHIBIT 3