2012 Comprehensive Annual Financial Report - the City of Tukwila
2012 Comprehensive Annual Financial Report - the City of Tukwila 2012 Comprehensive Annual Financial Report - the City of Tukwila
CITY OF TUKWILA: 2012 CAFRNOTES TO THE FINANCIAL STATEMENTSthe jurisdiction of the Member Cities. The SCORE Facility may serve the Member Cities and SubscribingAgencies which are in need of correctional facilities. Any agreement with a Subscribing Agency shall be inwriting and approved by SCORE as provided within the SCORE Formation Interlocal Agreement.Financing for the acquisition, construction, equipping, and improvement of the SCORE Facility will beprovided by bonds issued by the South Correctional Entity Facility Public Development Authority (the“SCORE PDA”), a public development authority chartered by the City of Renton pursuant to RCW35.21.730 through 35.21.755 and secured by the full faith and credit of the Cities of Auburn, Burien,Federal Way, Renton, SeaTac, and Tukwila (the “Owner Cities”). The SCORE PDA issued $86 million inspecial obligation bonds in 2009 to carry out the facility development project. The following is a summaryof the debt service requirements for the bond issue:SUMMARY OF DEBT SERVICE REQUIREMENTSDebt Service ScheduleDebt Service Allocation to Owner Cities35% BABs Auburn Burien Federal Way Renton SeaTac TukwilaYear Principal Interest Subsidy Total 31% 4% 18% 36% 3% 8%2013 $ 1,915,000 $ 5,126,998 $ (1,675,089) $ 5,366,909 $ 1,663,742 $ 214,676 $ 966,044 $ 1,932,087 $ 161,007 $ 429,3532014 1,950,000 5,066,566 (1,654,975) 5,361,591 1,662,093 214,464 965,087 1,930,173 160,848 428,9272015 1,990,000 4,995,069 (1,632,787) 5,352,282 1,659,207 214,091 963,411 1,926,822 160,568 428,1832016 2,065,000 4,911,886 (1,632,787) 5,344,099 1,656,671 213,764 961,938 1,923,876 160,323 427,5282017 2,145,000 4,820,241 (1,621,980) 5,343,261 1,656,411 213,730 961,787 1,923,574 160,298 427,4612018-2022 11,990,000 22,399,915 (7,748,350) 26,641,565 8,258,885 1,065,663 4,795,482 9,590,963 799,247 2,131,3252023-2027 14,485,000 18,727,798 (6,710,481) 26,502,317 8,215,718 1,060,093 4,770,417 9,540,834 795,070 2,120,1852028-2032 17,725,000 13,590,870 (4,959,695) 26,356,175 8,170,414 1,054,247 4,744,112 9,488,223 790,685 2,108,4942033-2037 21,855,000 7,082,263 (2,731,829) 26,205,434 8,123,685 1,048,217 4,716,978 9,433,956 786,163 2,096,4352038-2039 10,115,000 676,321 (353,824) 10,437,497 3,235,624 417,500 1,878,749 3,757,499 313,125 835,000Totals $ 86,235,000 $ 87,397,927 $ (30,721,797) $ 142,911,130 $ 44,302,450 $ 5,716,445 $ 25,724,004 $ 51,448,007 $ 4,287,334 $ 11,432,891The City of Tukwila reports its share of equity interest in the Governmental Activities column within theGovernment-wide financial statements under non-current assets. The share of equity belonging to the sixparticipating cities is as follows:ITEM AUBURN BURIENFEDERALWAY RENTON SEATAC TUKWILA TOTALEquity January 1, 2012 $ 3,189,320 $ 411,525 $ 1,851,863 $ 3,703,728 $ 308,643 $ 823,050 $ 10,288,129Current Year Increase/(Decrease) (1,820,461) (234,898) (1,057,043) (2,114,084) (176,174) (469,796) (5,872,456)Equity December 31, 2012 $ 1,368,859 $ 176,627 $ 794,820 $ 1,589,644 $ 132,469 $ 353,254 $ 4,415,673Percent of Equity 31.00% 4.00% 18.00% 36.00% 3.00% 8.00% 100.00%Note: Interest is to be paid from bond proceeds during the construction period (2010-2011).The investment in joint venture for SCORE on the Statement of Net Position includes Tukwila’s share ofdebt issued in 2009. The City’s share of SCORE debt is $6,898,800. See Note 11 for additionalinformation on long-term debt. Completed financial statements for SCORE and SCORE PDA can beobtained from the SCORE office, 20817 17 th Avenue South, Des Moines, WA 98198.78
CITY OF TUKWILA: 2012 CAFRNOTES TO THE FINANCIAL STATEMENTSNOTE 9 – PENSION PLANSWashington State Department of Retirement SystemsSubstantially all of the City’s full-time and qualifying part-time employees participate in one of thefollowing statewide retirement systems administered by the Washington State Department of RetirementSystems, under cost-sharing multiple-employer public employee defined benefit retirement plans. TheDepartment of Retirement Systems (DRS), a department within the primary government of the State ofWashington, issues a publicly available comprehensive annual financial report (CAFR) that includesfinancial statements and required supplementary information for each plan. The DRS CAFR may beobtained by writing to: Department of Retirement Systems, Communications Unit, PO Box 48380,Olympia, WA 98504-8380; or it may be downloaded from the DRS website atwww.drs.wa.gov/administration/annual-report/cafr/. The following disclosures are made pursuant toGASB Statements No. 27, Accounting for Pensions by State and Local Government Employers and No.50, Pension Disclosures, an Amendment of GASB Statements No. 25 and No. 27.Public Employees Retirement System (PERS) Plans 1, 2, and 3Plan DescriptionThe Legislature established PERS in 1947. Membership in the system includes: elected officials; stateemployees; employees of the Supreme, Appeals, and Superior courts ( other than judges currently in theJudicial Retirement System); employees of legislative committees; community and technical colleges,college and university employees not participating in higher education retirement programs; employees ofdistrict and municipal courts; and employees of local governments. Approximately 50 percent of PERSsalaries are accounted for by state employment. PERS retirement benefit provisions are established inChapters 41.34 and 41.40 RCW and may be amended only by the State Legislature.PERS is a cost-sharing multiple-employer retirement system comprised of three separate plans formembership purposes: Plans 1 and 2 are defined benefit plans and Plan 3 is a defined benefit plan with adefined contribution component.PERS members who joined the system by September 30, 1977 are Plan 1 members. Those who joinedon or after October 1, 1977 and by either, February 28, 2002 for state and higher education employees,or August 31, 2002 for local government employees, are Plan 2 members unless they exercised anoption to transfer their membership to Plan 3. PERS members joining the system on or after March 1,2002 for state and higher education employees, or September 1, 2002 for local government employeeshave the irrevocable option of choosing membership in either PERS Plan 2 or PERS Plan 3. The optionmust be exercised within 90 days of employment. Employees who fail to choose within 90 days default toPERS Plan 3. Notwithstanding, PERS Plan 2 and Plan 3 members may opt out of plan membership ifterminally ill, with less than five years to live.PERS is comprise of and reported as three separate plans for accounting purposes: Plan 1, Plan 2/3, andPlan 3. Plan 1 accounts for the defined benefits of Plan 1 members. Plan 2/3 accounts for the definedbenefits of Plan 2 members and the defined benefit portion of benefits for Plan 3 members. Plan 3accounts for the defined contribution portion of benefits for Plan 3 members. Although members can onlybe a member of either Plan 2 or Plan 3, the defined benefit portions of Plan2 and Plan 3 are accountedfor in the same pension trust fund. All assets of this Plan 2/3 defined benefit plan may legally be used topay the defined benefits of any of the Plan 2 or Plan 3 members or beneficiaries, as defined by the termsof the plan. Therefore, Plan 2/3 is considered to be a single plan for accounting purposes.PERS Plan 1 and Plan 2 retirement benefits are financed from a combination of investment earnings andemployer and employee contributions. Employee contributions to the PERS Plan 1 and Plan 2 definedbenefit plans accrue interest at a rate specified by the Director of DRS. During DRS’ Fiscal Year 2012,the rate was five and on-half percent compounded quarterly. Members in PERS Plan 1 and Plan 2 can79
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CITY OF TUKWILA: <strong>2012</strong> CAFRNOTES TO THE FINANCIAL STATEMENTS<strong>the</strong> jurisdiction <strong>of</strong> <strong>the</strong> Member Cities. The SCORE Facility may serve <strong>the</strong> Member Cities and SubscribingAgencies which are in need <strong>of</strong> correctional facilities. Any agreement with a Subscribing Agency shall be inwriting and approved by SCORE as provided within <strong>the</strong> SCORE Formation Interlocal Agreement.Financing for <strong>the</strong> acquisition, construction, equipping, and improvement <strong>of</strong> <strong>the</strong> SCORE Facility will beprovided by bonds issued by <strong>the</strong> South Correctional Entity Facility Public Development Authority (<strong>the</strong>“SCORE PDA”), a public development authority chartered by <strong>the</strong> <strong>City</strong> <strong>of</strong> Renton pursuant to RCW35.21.730 through 35.21.755 and secured by <strong>the</strong> full faith and credit <strong>of</strong> <strong>the</strong> Cities <strong>of</strong> Auburn, Burien,Federal Way, Renton, SeaTac, and <strong>Tukwila</strong> (<strong>the</strong> “Owner Cities”). The SCORE PDA issued $86 million inspecial obligation bonds in 2009 to carry out <strong>the</strong> facility development project. The following is a summary<strong>of</strong> <strong>the</strong> debt service requirements for <strong>the</strong> bond issue:SUMMARY OF DEBT SERVICE REQUIREMENTSDebt Service ScheduleDebt Service Allocation to Owner Cities35% BABs Auburn Burien Federal Way Renton SeaTac <strong>Tukwila</strong>Year Principal Interest Subsidy Total 31% 4% 18% 36% 3% 8%2013 $ 1,915,000 $ 5,126,998 $ (1,675,089) $ 5,366,909 $ 1,663,742 $ 214,676 $ 966,044 $ 1,932,087 $ 161,007 $ 429,3532014 1,950,000 5,066,566 (1,654,975) 5,361,591 1,662,093 214,464 965,087 1,930,173 160,848 428,9272015 1,990,000 4,995,069 (1,632,787) 5,352,282 1,659,207 214,091 963,411 1,926,822 160,568 428,1832016 2,065,000 4,911,886 (1,632,787) 5,344,099 1,656,671 213,764 961,938 1,923,876 160,323 427,5282017 2,145,000 4,820,241 (1,621,980) 5,343,261 1,656,411 213,730 961,787 1,923,574 160,298 427,4612018-2022 11,990,000 22,399,915 (7,748,350) 26,641,565 8,258,885 1,065,663 4,795,482 9,590,963 799,247 2,131,3252023-2027 14,485,000 18,727,798 (6,710,481) 26,502,317 8,215,718 1,060,093 4,770,417 9,540,834 795,070 2,120,1852028-2032 17,725,000 13,590,870 (4,959,695) 26,356,175 8,170,414 1,054,247 4,744,112 9,488,223 790,685 2,108,4942033-2037 21,855,000 7,082,263 (2,731,829) 26,205,434 8,123,685 1,048,217 4,716,978 9,433,956 786,163 2,096,4352038-2039 10,115,000 676,321 (353,824) 10,437,497 3,235,624 417,500 1,878,749 3,757,499 313,125 835,000Totals $ 86,235,000 $ 87,397,927 $ (30,721,797) $ 142,911,130 $ 44,302,450 $ 5,716,445 $ 25,724,004 $ 51,448,007 $ 4,287,334 $ 11,432,891The <strong>City</strong> <strong>of</strong> <strong>Tukwila</strong> reports its share <strong>of</strong> equity interest in <strong>the</strong> Governmental Activities column within <strong>the</strong>Government-wide financial statements under non-current assets. The share <strong>of</strong> equity belonging to <strong>the</strong> sixparticipating cities is as follows:ITEM AUBURN BURIENFEDERALWAY RENTON SEATAC TUKWILA TOTALEquity January 1, <strong>2012</strong> $ 3,189,320 $ 411,525 $ 1,851,863 $ 3,703,728 $ 308,643 $ 823,050 $ 10,288,129Current Year Increase/(Decrease) (1,820,461) (234,898) (1,057,043) (2,114,084) (176,174) (469,796) (5,872,456)Equity December 31, <strong>2012</strong> $ 1,368,859 $ 176,627 $ 794,820 $ 1,589,644 $ 132,469 $ 353,254 $ 4,415,673Percent <strong>of</strong> Equity 31.00% 4.00% 18.00% 36.00% 3.00% 8.00% 100.00%Note: Interest is to be paid from bond proceeds during <strong>the</strong> construction period (2010-2011).The investment in joint venture for SCORE on <strong>the</strong> Statement <strong>of</strong> Net Position includes <strong>Tukwila</strong>’s share <strong>of</strong>debt issued in 2009. The <strong>City</strong>’s share <strong>of</strong> SCORE debt is $6,898,800. See Note 11 for additionalinformation on long-term debt. Completed financial statements for SCORE and SCORE PDA can beobtained from <strong>the</strong> SCORE <strong>of</strong>fice, 20817 17 th Avenue South, Des Moines, WA 98198.78
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