Comprehensive Annual Financial Report - City of Santa Monica

CITY OF SANTA MONICA, CALIFORNIA
Notes to Basic Financial Statements, Continued
For the fiscal year ended June 30, 2009
Grants
The City recognizes as revenue grant monies received as reimbursement for costs incurred in certain
Federal and State programs it administers. Although the City’s Federal grant programs have been
audited through June 30, 2009 in accordance with the requirements of the Federal Single Audit Act of
1997 and the related U.S. Office of Management and Budget Circular A-133, these programs may be
subject to financial and compliance audits by the reimbursing agencies. The amount, if any, of
expenditures which may be disallowed by the granting agencies cannot be determined at this time,
although the City expects such amounts, if any, to be immaterial.
Construction Commitments
The City has a number of construction projects currently underway. Purchase orders, contracts and
other commitments for these projects are recorded in order to reserve the portion of the applicable
appropriation and are recorded at year-end as designations of fund balances. Approximately $152
million will be payable upon future performance under these contracts.
Operating Lease Revenue/Expenses
The City has entered into operating lease arrangements as lessor for property. The following schedule is
an analysis of the City’s investment in property under operating leases by major classes as of June 30,
2009:
Land $ 144,038,074
Buildings 41,400,505
Improvements other than buildings 10,302,396
Machinery and equipment 1,782,774
Infrastructure 8,213,438
205,737,187
Less: Accumulated depreciation (30,471,485)
Total $ 175,265,702
The following is a schedule of both future minimum lease rental revenue to be received by the City as
lessor and lease payments to be made by the City as lessee under operating leases that have initial or
remaining noncancelable lease terms in excess of one year as of June 30, 2009:
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