HomeMy WebLinkAbout04-06-16 Common Council Meeting AgendaOFFICIAL NOTICE OF MEETING
A Regular meeting of the Common Council will be held on Wednesday, April 6, 2016, at
6:00 p.m. in the Common Council Chambers at City Hall, 108 East Green Street, Ithaca,
New York. Your attendance is requested.
AGENDA
1. PLEDGE OF ALLEGIANCE:
2. ADDITIONS TO OR DELETIONS FROM THE AGENDA:
3. PROCLAMATIONS/AWARDS:
3.1 Presentation of Quarterly Employee Recognition Award
4. SPECIAL ORDER OF BUSINESS:
5. SPECIAL PRESENTATIONS BEFORE COUNCIL:
5.1 Presentation by Catholic Charities on Plans to be a Refugee Resettlement
Agency
6. PETITIONS AND HEARINGS OF PERSONS BEFORE COUNCIL:
7. PRIVILEGE OF THE FLOOR – COMMON COUNCIL AND THE MAYOR:
8. CONSENT AGENDA ITEMS:
Superintendent of Public Works:
8.1 Mahogany Grill Alcohol Permit Request - Resolution
8.2 Ithaca Ale House Alcohol Permit Request - Resolution
8.3 Kilpatrick’s Restaurant - Alcohol Permit Request – Resolution
8.4 Sahara Restaurant Alcohol Permit Request - Resolution
8.5 Taste of Thai Alcohol Permit Request - Resolution
8.6 Le Café Cent-Dix Alcohol Permit Request - Resolution
8.7 Mercato Bar and Kitchen Restaurant Alcohol Permit Request - Resolution
9. CITY ADMINISTRATION COMMITTEE:
9.1 Finance - Approval of 2014 City Single Audit – Resolution
9.2 City Controller’s Report
10. PLANNING AND ECONOMIC DEVELOPMENT COMMITTEE:
10.1 Brindley Street Bridge Replacement – Designation of Lead Agency Resolution
10.2 Six-Mile Creek Watershed Conservation Easement – Resolution
10.3 An Ordinance to Amend the City of Ithaca Municipal Code, Chapter 325, Entitled
“Zoning,” Article IV, Section 325-12, in Order to Amend the Approval Process for
the Planned Unit Development (PUD)
Common Council Meeting Agenda
April 6, 2016
Page 2
11. REPORTS OF SPECIAL COMMITTEES:
12. NEW BUSINESS:
12.1 Possible Motion to Enter Into Executive Session to Discuss Contract
Negotiations
13. INDIVIDUAL MEMBER – FILED RESOLUTIONS:
14. MAYOR’S APPOINTMENTS:
14.1 Appointments to City of Ithaca Local Board of Assessment Review - Resolution
14.2 Appointment to the Program Oversight Committee (POC) for the Community
Housing Development Fund
14.3 Appointments to Various City Boards and Committees – Resolution
(additional information may be distributed under separate cover)
15. REPORTS OF COMMON COUNCIL LIAISONS:
16. REPORT OF CITY CLERK:
17. REPORT OF CITY ATTORNEY:
18. MINUTES FROM PREVIOUS MEETINGS:
18.1 Approval of the March 2, 2016 Common Council Meeting Minutes – Resolution
19. ADJOURNMENT:
If you have a disability that will require special arrangements to be made in order for you
to fully participate in the meeting, please contact the City Clerk at 274-6570 at least 48
hours before the meeting.
______________________________
Julie Conley Holcomb, CMC
City Clerk
Date: March 31, 2016
8. CONSENT AGENDA ITEMS:
Superintendent of Public Works:
8.1 Mahogany Grill Alcohol Permit Request - Resolution
WHEREAS, the Superintendent of Public Works office has received a request to allow the
Mahogany Grill restaurant to utilize certain areas along Aurora Street for outdoor dining;
and
WHEREAS, this use of public property has been deemed proper and successful; and
WHEREAS, the City of Ithaca wishes to promote diverse uses of the Primary and
Secondary Commons, including outdoor dining; and
WHEREAS, it is Common Council's responsibility to determine whether or not to allow the
serving and consumption of alcohol on the Primary and Secondary Commons; and
WHEREAS, Common Council has determined that the use of this public property for
outdoor dining at the Mahogany Grill Restaurant, including the responsible sale and
consumption of alcohol, is desirable; and
WHEREAS, Common Council has determined that any use of this or similar public
property involving the same and consumption of alcohol should be covered by a minimum
of $1,000,000 insurance under the Dram Shop Act; now, therefore be it
RESOLVED, For the year 2016, Common Council hereby approves a revocable Alcoholic
Beverage Permit for the outdoor sale and consumption of alcohol for the Mahogany Grill
Restaurant that includes the sale of alcohol in accord with the terms and conditions set
forth in application therefore, including minimum Dram Shop coverage in the amount of
$1,000,000 and the approval of an outdoor dining permit.
8.2 Ithaca Ale House Alcohol Permit Request - Resolution
WHEREAS, the Ithaca Ale House has requested permission to utilize certain areas along
Aurora Street for outdoor dining; and
WHEREAS, this use of public property has been deemed proper and successful; and
WHEREAS, the City of Ithaca wishes to promote diverse uses of the Primary and
Secondary Commons, including outdoor dining; and
WHEREAS, it is Common Council's responsibility to determine whether or not to allow the
serving and consumption of alcohol on the Primary and Secondary Commons; and
WHEREAS, Common Council has determined that the use of this public property for
outdoor dining at the Ithaca Ale House, including the responsible sale and consumption of
alcohol, is desirable; and
WHEREAS, Common Council has determined that any use of this or similar public
property involving the same and consumption of alcohol should be covered by a minimum
of $1,000,000 insurance under the Dram Shop Act; now, therefore be it
RESOLVED, For the year 2016, Common Council hereby approves a revocable Alcoholic
Beverage Permit for the outdoor sale and consumption of alcohol for the Ithaca Ale House
that includes the sale of alcohol in accord with the terms and conditions set forth in
application therefore, including minimum Dram Shop coverage in the amount of
$1,000,000 and the approval of an outdoor dining permit.
8.3 Kilpatrick’s Restaurant - Alcohol Permit Request – Resolution
WHEREAS, the Superintendent of Public Works office has received a request to allow
Kilpatrick’s restaurant to utilize certain areas along North Tioga Street for outdoor dining;
and
WHEREAS, this use of public property has been deemed proper and successful; and
WHEREAS, the City of Ithaca wishes to promote diverse uses of the Primary and
Secondary Commons, including outdoor dining; and
WHEREAS, it is Common Council's responsibility to determine whether or not to allow the
serving and consumption of alcohol on the Primary and Secondary Commons; and
WHEREAS, Common Council has determined that the use of this public property for
outdoor dining at Kilpatrick’s restaurant, including the responsible sale and consumption of
alcohol, is desirable; and
WHEREAS, Common Council has determined that any use of this or similar public
property involving the same and consumption of alcohol should be covered by a minimum
of $1,000,000 insurance under the Dram Shop Act; now, therefore be it
RESOLVED, For the year 2016, Common Council hereby approves a revocable Alcoholic
Beverage Permit for the outdoor sale and consumption of alcohol for Kilpatrick’s restaurant
that includes the sale of alcohol in accord with the terms and conditions set forth in
application therefore, including minimum Dram Shop coverage in the amount of
$1,000,000 and the approval of an outdoor dining permit.
8.4 Sahara Restaurant Alcohol Permit Request - Resolution
WHEREAS, the Sahara Restaurant has requested permission to utilize certain areas
along Aurora Street for outdoor dining; and
WHEREAS, this use of public property has been deemed proper and successful; and
WHEREAS, the City of Ithaca wishes to promote diverse uses of the Primary and
Secondary Commons, including outdoor dining; and
WHEREAS, it is Common Council's responsibility to determine whether or not to allow
the serving and consumption of alcohol on the Primary and Secondary Commons; and
WHEREAS, Common Council has determined that the use of this public property for
outdoor dining at the Sahara Restaurant, including the responsible sale and
consumption of alcohol, is desirable; and
WHEREAS, Common Council has determined that any use of this or similar public
property involving the same and consumption of alcohol should be covered by a
minimum of $1,000,000 insurance under the Dram Shop Act; now, therefore be it
RESOLVED, For the year 2016, Common Council hereby approves a revocable
Alcoholic Beverage Permit for the outdoor sale and consumption of alcohol for the
Sahara Restaurant that includes the sale of alcohol in accord with the terms and
conditions set forth in application therefore, including minimum Dram Shop coverage in
the amount of $1,000,000 and the approval of an outdoor dining permit.
8.5 Taste of Thai Alcohol Permit Request - Resolution
WHEREAS, the Superintendent of Public Works office has received a request to allow the
Taste of Thai Restaurant to utilize certain areas along the Primary Commons for outdoor
dining; and
WHEREAS, this use of public property has been deemed proper and successful; and
WHEREAS, the City of Ithaca wishes to promote diverse uses of the Primary and
Secondary Commons, including outdoor dining; and
WHEREAS, it is Common Council's responsibility to determine whether or not to allow the
serving and consumption of alcohol on the Primary and Secondary Commons; and
WHEREAS, Common Council has determined that the use of this public property for
outdoor dining at the Taste of Thai Restaurant, including the responsible sale and
consumption of alcohol, is desirable; and
WHEREAS, Common Council has determined that any use of this or similar public
property involving the same and consumption of alcohol should be covered by a minimum
of $1,000,000 insurance under the Dram Shop Act; now, therefore be it
RESOLVED, For the year 2016, Common Council hereby approves a revocable Alcoholic
Beverage Permit for the outdoor sale and consumption of alcohol for the Taste of Thai
Restaurant that includes the sale of alcohol in accord with the terms and conditions set
forth in application therefore, including minimum Dram Shop coverage in the amount of
$1,000,000 and the approval of an outdoor dining permit.
8.6 Le Café Cent-Dix Alcohol Permit Request - Resolution
WHEREAS, the Superintendent of Public Works office has received a request to allow Le
Café Cent-Dix to utilize certain areas along North Aurora Street for outdoor dining; and
WHEREAS, this use of public property has been deemed proper and successful; and
WHEREAS, the City of Ithaca wishes to promote diverse uses of the Primary and
Secondary Commons, including outdoor dining; and
WHEREAS, it is Common Council's responsibility to determine whether or not to allow the
serving and consumption of alcohol on the Primary and Secondary Commons; and
WHEREAS, Common Council has determined that the use of this public property for
outdoor dining at Le Café Cent-Dix, including the responsible sale and consumption of
alcohol, is desirable; and
WHEREAS, Common Council has determined that any use of this or similar public
property involving the same and consumption of alcohol should be covered by a minimum
of $1,000,000 insurance under the Dram Shop Act; now, therefore be it
RESOLVED, For the year 2016, Common Council hereby approves a revocable Alcoholic
Beverage Permit for the outdoor sale and consumption of alcohol for Le Café Cent-Dix
that includes the sale of alcohol in accord with the terms and conditions set forth in
application therefore, including minimum Dram Shop coverage in the amount of
$1,000,000 and the approval of an outdoor dining permit.
8.7 Mercato Bar and Kitchen Restaurant Alcohol Permit Request - Resolution
WHEREAS, the Superintendent of Public Works office has received a request to allow
Mercato Bar and Kitchen Restaurant to utilize certain areas along North Aurora Street for
outdoor dining; and
WHEREAS, this use of public property has been deemed proper and successful; and
WHEREAS, the City of Ithaca wishes to promote diverse uses of the Primary and
Secondary Commons, including outdoor dining; and
WHEREAS, it is Common Council's responsibility to determine whether or not to allow the
serving and consumption of alcohol on the Primary and Secondary Commons; and
WHEREAS, Common Council has determined that the use of this public property for
outdoor dining at Mercato Bar and Kitchen Restaurant, including the responsible sale and
consumption of alcohol, is desirable; and
WHEREAS, Common Council has determined that any use of this or similar public
property involving the same and consumption of alcohol should be covered by a minimum
of $1,000,000 insurance under the Dram Shop Act; now, therefore be it
RESOLVED, For the year 2016, Common Council hereby approves a revocable Alcoholic
Beverage Permit for the outdoor sale and consumption of alcohol for Mercato Bar and
Kitchen Restaurant that includes the sale of alcohol in accord with the terms and
conditions set forth in application therefore, including minimum Dram Shop coverage in the
amount of $1,000,000 and the approval of an outdoor dining permit.
9. CITY ADMINISTRATION COMMITTEE:
9.1 Finance - Approval of 2014 City Single Audit – Resolution
RESOLVED, That the Independent Auditor’s Report for the period January 1, 2014,
through December 31, 2014, prepared by the accounting firm of Insero & Company,
formerly Ciaschi, Dietershagen, Little, Mickelson & Company, LLP, be accepted to
comply with all the City’s applicable Governmental Accounting Standards Board (GASB)
Statement 34 and other related audit and single-audit requirements.
MANAGEMENT COMMENT LETTER
Common Council
City of Ithaca
Ithaca, New York
In planning and performing our audit of the financial statements of the governmental activities, each major fund,
and the aggregate remaining fund information of the City of Ithaca (the City) for the year ended December 31,
2014, in accordance with auditing standards generally accepted in the United States of America, we considered
the City’s internal control over financial reporting (internal control) as a basis for designing our auditing
procedures for the purpose of expressing our opinions on the financial statements, but not for the purpose of
expressing an opinion on the effectiveness of the City's internal control. Accordingly, we do not express an
opinion on the effectiveness of the City's internal control.
A deficiency in internal control exists when the design or operation of a control does not allow management or
employees, in the normal course of performing their assigned functions, to prevent, or detect and correct
misstatements on a timely basis. A material weakness is a deficiency or combination of deficiencies in internal
control, such that there is a reasonable possibility that a material misstatement of the City’s financial statements
will not be prevented, or detected and corrected on a timely basis.
Our consideration of internal control was for the limited purpose described in the first paragraph and was not
designed to identify all deficiencies in internal control that might be significant deficiencies or material
weaknesses and, therefore, there can be no assurance that all such deficiencies have been identified. We did
identify deficiencies in internal control that we consider to be a material weaknesses, as defined above. Those
deficiencies are defined in the Schedule of Findings and Questioned Costs as 03-001 and 10-001.
During our audit, we also became aware of certain matters that are opportunities for strengthening internal
controls and operating efficiency. This letter summarizes our current and prior year comments and
recommendations regarding these matters. This letter does not affect our report dated March 17, 2016 on the
financial statements of the City of Ithaca.
NONCOMPLIANCE
Late Filing of Single Audit Report
Finding:
Under the Single Audit Act of 1996 and OMB Circular A-133, the City was required to file the Single Audit
reporting package by the end of the 9th month following the end of the fiscal year. This deadline was not met on
a timely basis for the years ended December 31, 2003 through 2014. The City experienced difficulties in
obtaining the information necessary to implement GASB Statement No. 34, for the years ending December 31,
2003 and 2004, resulting in late completion of financial statements for those years. In subsequent years, the
City has endeavored to reestablish a current time line for financial reporting.
Insero & Co. CPA s, LLP
Rochester | Ithaca | Corning | Cortland | Watkins Glen | (800) 232-9547 | www.inserocpa.com
- 2 -
Recommendation:
We recommend the requirements of OMB Circular A-133 and 2 C.F.R. 200 titled Uniform Administrative
Requirements, Cost Principles, and Audit Requirements for Federal Awards (Uniform Guidance) be adhered to
by striving to have all information required for the audit available on a timely basis. This will help insure
timely audit report issuance and compliance with the filing deadline.
MATERIAL WEAKNESS
Capital Project Accounting
Finding:
Currently, City personnel account for the Capital Fund in spreadsheets and do not enter information in the City’s
financial software system. This creates opportunities for errors to occur and not be detected by management in a
timely manner.
The City’s financial software system does not have the capability to account for the numerous capital projects in
process. The City authorized the installation of the capital project accounting module of MUNIS, which was to
be completed during the 2013 fiscal year. However, the new module has not yet been implemented.
Recommendation:
We recommended City personnel convert the current accounting process to incorporate the Capital Fund as a
whole into its financial software system and continue to account for each project in spreadsheets, while pursuing
a system that will provide the functionality desired to appropriately track Capital Fund activity.
Current Status:
The City is in process of setting up the chart of accounts for Capital Projects in MUNIS. Full implementation of
the module is expected during the 2016 fiscal year.
OTHER MATTERS
Recurring Comments
Fixed Asset Accounting
Finding:
Currently, City personnel account for fixed assets in spreadsheets rather than the City's financial software
system. This creates greater opportunities for error. Inquiry with management revealed an upgrade to MUNIS
is planned, which will include the fixed asset module.
Recommendation:
We recommend converting the current accounting process to incorporate fixed assets in the financial software
system as soon as feasible.
Physical Inventory of Capital Assets
Finding:
The City has not had a formal physical inventory of capital assets in recent years. The current list was created
using lists provided by each department from the last physical inventory. A current physical inventory is
necessary to ensure records only include assets currently in use. Discussions with City management revealed a
committee of the City Council has been formed to work on this issue.
Recommendation:
We continue to recommend the City perform a physical inventory of all capital assets and update records as
necessary.
Current Status:
No change from previous year.
- 3 -
Purchasing Policy
Finding:
During our prior year audit, City policy was not always followed when making purchases, specifically the use of
purchase orders. The City requires purchase orders for purchases of $250 or more, however, 4 of 16
disbursements tested which required purchase orders did not have them. During our current year audit,
however, purchase orders were present for all items tested.
During the current and prior year audits, we noted the Purchasing Policy had not been updated to reflect the
higher bidding thresholds under General Municipal Law. Inquiry of management revealed the Purchasing Policy
is in the process of being updated; however, the process has proven to be a lengthy one. Having an outdated
policy that does not meet the needs of the City and, therefore, is not enforced could send a message to staff that
it is not important to follow other City policies.
Recommendation:
We recommend the Purchasing Policy be updated as soon as practicable and the updated policy adhered to by all
departments.
Held Checks
Finding:
During the current and prior year audits, a significant number of checks from various City accounts were
written, but not sent to vendors in a timely manner. As a result, these bank accounts showed a large negative
book balance. This practice has the effect of understating both cash and accounts payable balances. Through
inquiry of City personnel, we determined the condition was related to the audit process at year end.
Additionally, blank checks are held in the vault to be backdated if necessary and subsequently destroyed if not
used.
Recommendation:
We continue to recommend procedures be developed and implemented stating checks only be written when
funds are available and with the intention of sending payments timely. City staff has begun meeting to develop
such procedures. We also recommend discontinuing the practice of holding blank checks in the vault for the
purpose of backdating them.
Current Status:
No change from previous year.
This communication is intended solely for the information and use of management, the Common Council, and
others within the City of Ithaca, and is not intended to be and should not be used by anyone other than these
specified parties.
Respectfully Submitted,
Insero & Co. CPAs, LLP
Certified Public Accountants
Ithaca, New York
March 17, 2016
COMMUNICATION WITH THOSE CHARGED WITH GOVERNANCE
AT THE CONCLUSION OF THE AUDIT
Common Council
City of Ithaca
Ithaca, New York
We have audited the financial statements of the governmental activities, each major fund, and the aggregate
remaining fund information of the City of Ithaca (the City) for the year ended December 31, 2014, and have
issued our report thereon dated March 17, 2016. Professional standards require that we provide you with
information about our responsibilities under generally accepted auditing standards, Government Auditing
Standards, and OMB Circular A-133, as well as certain information related to the planned scope and timing of
our audit. We have communicated such information in our letter to you dated September 25, 2015. Professional
standards also require that we communicate to you the following information related to our audit.
Significant Audit Findings
Qualitative Aspects of Accounting Practices
Management is responsible for the selection and use of appropriate accounting policies. The significant
accounting policies used by the City are described in Note 1 to the financial statements. No new accounting
policies were adopted and the application of existing policies was not changed during the year. We noted no
transactions entered into by the City during the year for which there is a lack of authoritative guidance or
consensus. All significant transactions have been recognized in the financial statements in the proper period.
Accounting estimates are an integral part of the financial statements prepared by management and are based on
management's knowledge and experience about past and current events and assumptions about future events.
Certain accounting estimates are particularly sensitive because of their significance to the financial statements
and because of the possibility that future events affecting them may differ significantly from those expected.
The most sensitive estimates affecting the government-wide financial statements were compensated absences,
depreciation expense, and other postemployment benefits.
Management's estimates of compensated absences, depreciation expense, and other postemployment benefits are
based on current rates of compensation, an estimate of the useful lives of capital assets, and an actuarial
validation of postemployment liabilities. We evaluated the key factors and assumptions used to develop the
compensated absences, depreciation expense, and other postemployment benefit estimates in determining they
are reasonable in relation to the financial statements taken as a whole.
Certain financial statement disclosures are particularly sensitive because of their significance to financial statement
users. The most sensitive disclosures concern capital assets, debt, and the liability for other postemployment
benefits, the details of which are presented in Notes 3.A.5, 3.B.2, 3.B.3, and 3.B.4 to the financial statements.
The financial statement disclosures are neutral, consistent, and clear.
Insero & Co. CPA s, LLP
Rochester | Ithaca | Corning | Cortland | Watkins Glen | (800) 232-9547 | www.inserocpa.com
- 2 -
Difficulties Encountered in Performing the Audit
We encountered no significant difficulties in dealing with management in performing and completing our audit.
Corrected and Uncorrected Misstatements
Professional standards require us to accumulate all known and likely misstatements identified during the audit,
other than those that are trivial, and communicate them to the appropriate level of management. Management has
corrected all such misstatements. In addition, none of the misstatements detected as a result of audit procedures
and corrected by management were material, either individually or in the aggregate, to the financial statements
taken as a whole.
Disagreements with Management
For purposes of this letter, professional standards define a disagreement with management as a financial
accounting, reporting, or auditing matter, whether or not resolved to our satisfaction, that could be significant to the
financial statements or the auditor’s report. We are pleased to report that no such disagreements arose during the
course of our audit.
Management Representations
We have requested certain representations from management that are included in the management representation
letter dated March 17, 2016.
Management Consultations with Other Independent Accountants
In some cases, management may decide to consult with other accountants about auditing and accounting matters,
similar to obtaining a "second opinion" on certain situations. If a consultation involves application of an
accounting principle to the City’s financial statements or a determination of the type of auditor’s opinion that may
be expressed on those statements, our professional standards require the consulting accountant to check with us to
determine that the consultant has all the relevant facts. To our knowledge, there were no such consultations with
other accountants.
Other Audit Matters or Issues
We generally discuss a variety of matters, including the application of accounting principles and auditing
standards, with management each year prior to retention as the City’s auditors. However, these discussions
occurred in the normal course of our professional relationship and our responses were not a condition to our
retention.
Other Matters
We applied certain limited procedures to Management’s Discussion and Analysis, budgetary comparison
schedules, and the Schedule of Funding Progress, which are required supplementary information (RSI) that
supplements the basic financial statements. Our procedures consisted of inquiries of management regarding the
methods of preparing the information and comparing the information for consistency with management’s
responses to our inquiries, the basic financial statements, and other knowledge we obtained during our audit of
the basic financial statements. We did not audit the RSI and do not express an opinion or provide any assurance
on the RSI.
We were engaged to report on the combining statements for the non-major funds, which accompany the
financial statements but are not RSI. The Schedule of Expenditures of Federal Awards is presented for purposes
of additional analysis as required by U.S. Office of Management and Budget Circular A-133, Audits of States,
Local Governments, and Non-Profit Organizations, and is also not a required part of the financial statements.
With respect to this supplementary information, we made certain inquiries of management and evaluated the
form, content, and methods of preparing the information to determine that the information complies with
accounting principles generally accepted in the United States of America, the method of preparing it has not
changed from the prior period, and the information is appropriate and complete in relation to our audit of the
financial statements. We compared and reconciled the supplementary information to the underlying accounting
records used to prepare the financial statements or to the financial statements themselves.
- 3 -
We would like to thank you and your staff for the cooperation and support given to us during the course of our
audit. We appreciate the opportunity to be of service to you and look forward to our continued involvement.
Restriction on Use
This information is intended solely for the use of the Common Council and management of the City of Ithaca,
and is not intended to be and should not be used by anyone other than these specified parties.
Respectfully Submitted,
Insero & Co. CPAs, LLP
Certified Public Accountants
Ithaca, New York
March 17, 2016
CITY OF ITHACA
Ithaca, New York
EXECUTIVE SUMMARY
December 31, 2014
CITY OF ITHACA
SUMMARY OF 2014 AUDIT REPORT AND FINDINGS
-1 -
Basic Financial Statements Description of Report and Findings
Report of Independent Auditors on Basic Financial
Statements (Page 1-2)
Unmodified opinion on the City of Ithaca’s (the City) basic
financial statements for the year ended December 31, 2014.
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
Report on the City’s compliance with laws and regulations
that may have a direct and material effect on the basic
financial statements, and on the City’s internal control
structure policies and procedures based on the auditor’s
understanding of the internal control structure and
assessment of control risk obtained as part of the audit of
the basic financial statements. This report identified one
material weakness in internal control over financial
reporting and one instance of material noncompliance at
the financial statement level.
Single Audit (OMB Circular A-133) Report
Report on Compliance with Requirements
Applicable to Each Major Program and Internal
Control Over Compliance in Accordance with OMB
Circular A-133
Report on 1) the City’s internal control structure policies
and procedures used in administering federal award
programs; 2) compliance requirements with respect to its
federal award programs. This report identified no material
instances of noncompliance and no material internal
control weaknesses regarding compliance in accordance
with OMB Circular A-133.
There are several federal award program expenditures that
amounted to $6,805,088.
Auditor’s Communication with Those Charged with
Governance at the Conclusion of the Audit
A letter that specifically addresses certain required
communications to the Common Council in accordance
with professional standards -there were no comments of
concern to be reported regarding the following:
Qualitative Aspects of Accounting Practices
Difficulties Encountered in Performing the Audit
Corrected and Uncorrected Misstatements
Disagreements with Management
Management Representations
Management Consultations with Other
Independent Accountants
Other Audit Matters or Issues
Management Letter A letter to management with selected communications.
ASSETS 2014 2013 2012 2011 2010
Assets:
Cash and cash equivalents - Unrestricted $3,782,111 $5,649,526 $4,588,324 $5,751,781 $6,269,481
- Restricted 487,581 521,114 986,404 985,151 954,538
Investments 1,706,657 -0--0--0--0-
Taxes receivable, net 927,452 688,271 778,459 781,190 927,500
Due from other funds 500,784 741,084 972,731 775,060 538,007
Due from state and federal governments 926,763 917,124 902,914 849,352 777,606
Due from other governments 968,733 703,139 1,150,150 938,525 729,573
Other receivables, net 399,645 329,456 368,676 381,459 405,761
Prepaid expenses 1,075,446 1,079,861 1,002,533 849,070 624,823
Inventories 197,290 196,801 183,206 179,463 170,281
Total Assets $10,972,462 $10,826,376 $10,933,397 $11,491,051 $11,397,570
LIABILITIES, DEFERRED INFLOWS OF
RESOURCES AND FUND BALANCES
Liabilities:
Accounts payable $461,325 $224,406 $259,948 $187,863 $189,376
Due to other funds 478,321 104,515 213,593 668,168 381,503
Due to other governments 474,442 252,038 270,616 475,807 521,659
Overpayments/Other liabilities 606,091 1,099,079 784,082 815,834 402,927
Deferred inflows of resources and
unearned revenue 1,133,015 898,190 988,379 990,678 1,136,988
Total Liabilities 3,153,194 2,578,228 2,516,618 3,138,350 2,632,453
Fund Balances:
Fund Balances - Reserved:
Encumbrances 567,833 330,994 330,994 241,007 350,163
Inventory/prepaid expenses 1,272,736 1,276,662 1,185,739 1,028,533 795,104
Workers' compensation 100,000 100,000 100,000 100,000 100,000
Capital 487,581 521,114 586,404 585,151 654,538
Insurance 1,703,180 1,699,116 2,015,132 2,015,132
Health consortium deposit 1,706,657 300,000 300,000 300,000
Total Reserved 4,134,807 3,931,950 4,202,253 4,269,823 4,214,937
Fund Balances - Unreserved:
Appropriated - Ensuing year's budget 393,177 622,022 299,632 995,000 792,000
Unappropriated 3,291,284 3,694,176 3,914,894 3,087,878 3,758,180
Total Unreserved 3,684,461 4,316,198 4,214,526 4,082,878 4,550,180
Total Fund Balances 7,819,268 8,248,148 8,416,779 8,352,701 8,765,117
Total Liabilities and Equity $10,972,462 $10,826,376 $10,933,397 $11,491,051 $11,397,570
Data Presented is Extracted from City's Independent Audit Reports for Purposes of Additional Analysis
See Audit Reports for Complete Information
DECEMBER 31,
- 2 -
CITY OF ITHACA
COMPARATIVE BALANCE SHEET
GENERAL FUND
REVENUES 2014 2013 2012 2011 2010
Real property taxes $20,515,747 $20,182,407 $19,565,035 $18,984,427 $18,230,175
Real property tax items 797,917 736,563 723,411 719,400 609,475
Other nonproperty tax items 447,313 426,188 466,125 520,243 493,767
Sales tax 13,432,961 12,846,512 12,582,768 12,414,740 11,929,544
Departmental income 4,081,541 3,925,398 3,770,388 3,814,836 3,364,115
Intergovernmental charges 3,884,948 3,871,446 3,900,921 4,054,241 4,018,620
Use of money and property 304,793 331,483 307,154 275,892 311,929
Licenses and permits 951,807 591,047 967,836 350,504 369,486
Fines and forfeitures 1,086,057 1,036,963 1,136,988 1,143,641 1,224,768
Sale of property and compensation for loss 497,456 320,649 154,304 234,532 113,159
Miscellaneous local sources 1,305,433 1,337,709 1,489,152 1,292,617 1,475,097
Interfund revenues 282,294 284,143 301,430 223,401 288,610
State sources 3,446,149 3,641,632 3,502,169 3,198,583 3,244,623
Federal sources 371,022 215,407 160,249 266,570 281,618
Total Revenues 51,405,438 49,747,547 49,027,930 47,493,627 45,954,986
Other Financing Sources:
Interfund Transfers 1,179,643 1,122,109 1,109,162 1,761,968 1,717,721
Total Revenues and Other Sources 52,585,081 50,869,656 50,137,092 49,255,595 47,672,707
EXPENDITURES
Current:
General governmental support 5,412,959 4,402,515 4,648,215 4,263,264 4,391,719
Public safety 13,410,005 14,309,135 14,372,138 14,893,551 14,895,511
Transportation 5,276,969 4,620,143 4,560,680 4,884,592 4,930,248
Economic assistance and opportunity 61,000 61,000 61,000 61,000 61,000
Culture and recreation 5,415,224 5,273,951 5,345,898 5,332,141 4,837,253
Home and community services 1,707,358 755,810 703,599 736,690 732,987
Employee benefits 15,254,314 14,820,542 13,868,667 12,958,075 10,810,462
Debt service (principal and interest)6,465,132 6,676,655 6,432,817 6,382,236 6,779,779
Total Expenditures 53,002,961 50,919,751 49,993,014 49,511,549 47,438,959
PERCENT INCREASE IN EXPENDITURES 104%102%101%104%102%
Other Financing Uses:
Interfund transfers 11,000 118,536 80,000 156,462 274,345
Total Expenditures and Other Uses 53,013,961 51,038,287 50,073,014 49,668,011 47,713,304
Excess of (Expenditures) Revenues (428,880)(168,631)64,078 (412,416)(40,597)
Fund Balance, Beginning 8,248,148 8,416,779 8,352,701 8,765,117 8,805,714
Fund Balance, Ending $7,819,268 $8,248,148 $8,416,779 $8,352,701 $8,765,117
Data Presented is Extracted from City's Independent Audit Reports for Purposes of Additional Analysis
See Audit Reports for Complete Information
GENERAL FUND
FOR THE YEAR ENDED DECEMBER 31,
- 3 -
CITY OF ITHACA
COMPARATIVE STATEMENTS OF REVENUES, EXPENDITURES, AND CHANGES IN FUND BALANCE
Modified Variance
REVENUES Budget Actual Encumbrances Fav./(Unfav.)
Real property taxes $20,520,104 $20,515,747 $$(4,357)
Real property tax items 737,500 797,917 60,417
Other nonproperty tax items 13,624,000 13,880,274 256,274
Departmental income 4,672,775 4,081,541 (591,234)
Intergovernmental charges 4,074,179 3,884,948 (189,231)
Use of money and property 375,000 304,793 (70,207)
Licenses and permits 779,050 951,807 172,757
Fines and forfeitures 1,170,000 1,086,057 (83,943)
Sale of property and compensation for loss 376,199 497,456 121,257
Miscellaneous local sources 1,368,288 1,305,433 (62,855)
Interfund revenues 282,294 282,294 -0-
State sources 3,197,769 3,446,149 248,380
Federal sources 423,428 371,022 (52,406)
Total Revenues 51,600,586 51,405,438 -0-(195,148)
Other Financing Sources:
Interfund transfers 1,362,208 1,179,643 (182,565)
Total Revenues/Other Sources 52,962,794 52,585,081 -0-(377,713)
EXPENDITURES
Current:
General governmental support 5,634,606 5,412,959 221,030 617
Public safety 13,623,207 13,410,005 188,996 24,206
Transportation 5,334,269 5,276,969 57,199 101
Economic assistance and opportunity 61,000 61,000 -0-
Culture and recreation 5,511,037 5,415,224 9,654 86,159
Home and community services 1,798,313 1,707,358 90,954 1
Employee benefits 15,486,820 15,254,314 232,506
Debt service (principal and interest)6,466,558 6,465,132 1,426
Total Expenditures 53,915,810 53,002,961 567,833 345,016
Other Financing Uses:
Interfund transfers 11,000 (11,000)
Total Expenditures and Other Uses 53,915,810 53,013,961 334,016
Excess of (Expenditures)(953,016)(428,880)$-0-$(43,697)
Appropriated Fund Balance 953,016
Net Change $-0-(428,880)
Fund Balance, Beginning 8,248,148
Fund Balance, Ending $7,819,268
See Audit Reports for Complete Information
- 4 -
CITY OF ITHACA
COMPARATIVE OPERATING STATEMENT - BUDGET vs. ACTUAL
GENERAL FUND
FOR THE YEAR ENDED DECEMBER 31,
2014
Data Presented is Extracted from City's Independent Audit Reports for Purposes of Additional Analysis
Modified Variance
REVENUES Budget Actual Encumbrances Fav./(Unfav.)
Real property taxes $20,097,901 $20,182,407 $$84,506
Real property tax items 702,000 736,563 34,563
Nonproperty tax items 13,460,806 13,272,700 (188,106)
Departmental income 4,028,426 3,925,398 (103,028)
Intergovernmental charges 4,038,727 3,871,446 (167,281)
Use of money and property 373,500 331,483 (42,017)
Licenses and permits 900,733 591,047 (309,686)
Fines and forfeitures 1,191,000 1,036,963 (154,037)
Sale of property and compensation for loss 376,629 320,649 (55,980)
Miscellaneous local sources 1,314,860 1,337,709 22,849
Interfund revenues 284,143 284,143 -0-
State sources 3,247,733 3,641,632 393,899
Federal sources 226,941 215,407 (11,534)
Total Revenues 50,243,399 49,747,547 -0-(495,852)
Other Financing Sources:
Interfund transfers 1,522,109 1,122,109 (400,000)
Total Revenues/Other Sources 51,765,508 50,869,656 -0-(895,852)
EXPENDITURES
Current:
General governmental support 4,679,513 4,402,515 121,536 155,462
Public safety 14,461,295 14,309,135 145,210 6,950
Transportation 4,941,896 4,620,143 62,233 259,520
Economic assistance and opportunity 61,000 61,000 -0-
Culture and recreation 5,327,987 5,273,951 10,042 43,994
Home and community services 874,396 755,810 32,000 86,586
Employee benefits 15,253,308 14,820,542 432,766
Debt service (principal and interest)6,678,203 6,676,655 1,548
Total Expenditures 52,277,598 50,919,751 371,021 986,826
Other Financing Uses:
Interfund transfers 118,536 118,536 -0-
Total Expenditures and Other Uses 52,396,134 51,038,287 371,021 986,826
Excess of (Expenditures) (630,626)(168,631)$(371,021)$90,974
Appropriated Fund Balance 1,467,949
Net Change $837,323 (168,631)
Fund Balance, Beginning 8,416,779
Fund Balance, Ending $8,248,148
See Audit Reports for Complete Information
- 4a -
CITY OF ITHACA
COMPARATIVE OPERATING STATEMENT - BUDGET vs. ACTUAL
GENERAL FUND
FOR THE YEAR ENDED DECEMBER 31,
2013
Data Presented is Extracted from City's Independent Audit Reports for Purposes of Additional Analysis
Modified Variance
REVENUES Budget Actual Encumbrances Fav./(Unfav.)
Real property taxes $19,562,775 $19,565,035 $$2,260
Real property tax items 589,500 723,411 133,911
Nonproperty tax items 13,115,000 13,048,893 (66,107)
Departmental income 3,749,048 3,770,388 21,340
Intergovernmental charges 3,980,781 3,900,921 (79,860)
Use of money and property 379,310 307,154 (72,156)
Licenses and permits 706,250 967,836 261,586
Fines and forfeitures 1,215,000 1,136,988 (78,012)
Sale of property and compensation for loss 229,286 154,304 (74,982)
Miscellaneous local sources 1,297,308 1,489,152 191,844
Interfund revenues 301,430 301,430 -0-
State sources 3,196,186 3,502,169 305,983
Federal sources 164,888 160,249 (4,639)
Total Revenues 48,486,762 49,027,930 -0-541,168
Other Financing Sources:
Interfund transfers 1,622,162 1,109,162 (513,000)
Total Revenues/Other Sources 50,108,924 50,137,092 -0-28,168
Current:
General governmental support 4,773,314 4,648,215 104,659 20,440
Public safety 14,610,998 14,372,138 145,042 93,818
Transportation 4,829,093 4,560,680 37,000 231,413
Economic assistance and opportunity 61,000 61,000 -0-
Culture and recreation 5,387,591 5,345,898 41,693 -0-
Home and community services 803,846 703,599 2,600 97,647
Employee benefits 14,292,241 13,868,667 423,574
Debt service (principal and interest)6,546,847 6,432,817 114,030
Total Expenditures 51,304,930 49,993,014 330,994 980,922
Other Financing Uses:
Interfund transfers 80,000 80,000 -0-
Total Expenditures and Other Uses 51,384,930 50,073,014 330,994 980,922
Excess of (Expenditures) Revenues (1,276,006)64,078 $(330,994)$1,009,090
Appropriated Fund Balance 1,276,006
Net Change $-0-64,078
Fund Balance, Beginning 8,352,701
Fund Balance, Ending $8,416,779
Data Presented is Extracted from City's Independent Audit Reports for Purposes of Additional Analysis
See Audit Reports for Complete Information
- 5 -
CITY OF ITHACA
COMPARATIVE OPERATING STATEMENT - BUDGET vs. ACTUAL
GENERAL FUND
FOR THE YEAR ENDED DECEMBER 31,
2012
EXPENDITURES
Modified Variance
REVENUES Budget Actual Encumbrances Fav./(Unfav.)
Real property taxes $18,844,225 $18,984,427 $$140,202
Real property tax items 536,000 719,400 183,400
Nonproperty tax items 12,827,000 12,934,983 107,983
Departmental income 3,571,339 3,814,836 243,497
Intergovernmental charges 4,079,206 4,054,241 (24,965)
Use of money and property 476,000 275,892 (200,108)
Licenses and permits 469,850 350,504 (119,346)
Fines and forfeitures 1,121,500 1,143,641 22,141
Sale of property and compensation for loss 79,280 234,532 155,252
Miscellaneous local sources 1,275,925 1,292,617 16,692
Interfund revenues 298,401 223,401 (75,000)
State sources 3,105,412 3,198,583 93,171
Federal sources 235,906 266,570 30,664
Total Revenues 46,920,044 47,493,627 -0-573,583
Other Financing Sources:
Interfund transfers 1,761,968 1,761,968 -0-
Total Revenues/Other Sources 48,682,012 49,255,595 -0-573,583
Current:
General governmental support 4,400,806 4,263,264 59,130 78,412
Public safety 15,044,745 14,893,551 140,412 10,782
Transportation 4,894,672 4,884,592 10,000 80
Economic assistance and opportunity 61,000 61,000 -0-
Culture and recreation 5,360,647 5,332,141 28,465 41
Home and community services 739,787 736,690 3,000 97
Employee benefits 13,183,989 12,958,075 225,914
Debt service (principal and interest)6,382,315 6,382,236 79
Total Expenditures 50,067,961 49,511,549 241,007 315,405
Other Financing Uses:
Interfund transfers 82,000 156,462 (74,462)
Total Expenditures and Other Uses 50,149,961 49,668,011 241,007 240,943
Excess of (Expenditures)(1,467,949)(412,416)$(241,007)$814,526
Appropriated Fund Balance 1,467,949
Net Change $-0-(412,416)
Fund Balance, Beginning 8,765,117
Fund Balance, Ending $8,352,701
See Audit Reports for Complete Information
- 5a -
CITY OF ITHACA
COMPARATIVE OPERATING STATEMENT - BUDGET vs. ACTUAL
GENERAL FUND
FOR THE YEAR ENDED DECEMBER 31,
2011
Data Presented is Extracted from City's Independent Audit Reports for Purposes of Additional Analysis
EXPENDITURES
Modified Variance
REVENUES Budget Actual Encumbrances Fav./(Unfav.)
Real property taxes $18,230,157 $18,230,175 $$18
Real property tax items 485,150 609,475 124,325
Nonproperty tax items 12,368,691 12,423,311 54,620
Departmental income 3,553,044 3,364,115 (188,929)
Intergovernmental charges 4,027,076 4,018,620 (8,456)
Use of money and property 508,050 311,929 (196,121)
Licenses and permits 287,050 369,486 82,436
Fines and forfeitures 1,076,800 1,224,768 147,968
Sale of property and compensation for loss 104,166 113,159 8,993
Miscellaneous local sources 1,258,072 1,475,097 217,025
Interfund revenues 288,610 288,610 -0-
State sources 3,260,520 3,244,623 (15,897)
Federal sources 345,870 281,618 (64,252)
Total Revenues 45,793,256 45,954,986 -0-161,730
Other Financing Sources:
Interfund transfers 1,717,720 1,717,721 1
Total Revenues/Other Sources 47,510,976 47,672,707 -0-161,731
EXPENDITURES
Current:
General governmental support 4,519,708 4,391,719 127,988 1
Public safety 15,245,530 14,895,511 120,995 229,024
Transportation 5,129,605 4,930,248 33,510 165,847
Economic assistance and opportunity 61,000 61,000 -0-
Culture and recreation 5,115,362 4,837,253 52,128 225,981
Home and community services 830,410 732,987 15,542 81,881
Employee benefits 11,053,624 10,810,462 243,162
Debt service (principal and interest)6,817,619 6,779,779 37,840
Total Expenditures 48,772,858 47,438,959 350,163 983,736
Other Financing Uses:
Interfund transfers 94,345 274,345 (180,000)
Total Expenditures and Other Uses 48,867,203 47,713,304 350,163 803,736
Excess of (Expenditures) Revenues (1,356,227)(40,597)$(350,163)$965,467
Appropriated Fund Balance 1,356,227
Net Change $-0-(40,597)
Fund Balance, Beginning 8,805,714
Fund Balance, Ending $8,765,117
CITY OF ITHACA
COMPARATIVE OPERATING STATEMENT - BUDGET vs. ACTUAL
GENERAL FUND
FOR THE YEAR ENDED DECEMBER 31,
2010
Data Presented is Extracted from City's Independent Audit Reports for Purposes of Additional Analysis
See Audit Reports for Complete Information
- 6 -
ASSETS 2014 2013 2012 2011 2010
Assets:
Cash and cash equivalents - Unrestricted $316,372 $241,683 $298,253 $318,067 $672,354
- Restricted 3,803,578 3,798,541 3,792,393 3,784,380 3,772,343
Investments 53,195 -0--0--0--0-
Due from other funds 38,603 30,225 8,328 255,883 347,044
Due from state and federal governments 10,000 25,000 -0--0--0-
Other receivables, net 957,383 800,323 699,199 584,030 474,971
Prepaid expenses 81,389 84,639 86,802 70,366 48,583
Inventories 494,604 487,851 450,454 368,593 303,179
Total Assets $5,755,124 $5,468,262 $5,335,429 $5,381,319 $5,618,474
LIABILITIES AND FUND BALANCES
Liabilities:
Accounts payable $32,172 $15,778 $18,405 $25,986 $27,129
Due to other funds 149,069 6,323 42,706 62,071 24,291
Overpayments/Other liabilities 34,895 20,578 16,188 26,909 50,619
Total Liabilities 216,136 42,679 77,299 114,966 102,039
Fund Balances:
Fund Balances - Reserved:
Encumbrances 2,158 42,631 135,849 247,514 165,407
Inventory/Prepaid expenses 575,993 572,490 537,256 438,959 351,762
Capital 3,803,578 3,798,541 3,792,393 3,784,380 3,772,343
Insurance 53,195 53,087 52,960 -0-52,680
Total Reserved 4,434,924 4,466,749 4,518,458 4,470,853 4,342,192
Fund Balances - Unreserved:
Appropriated - Ensuing year's budget -0--0--0-22,892 703,007
Unappropriated 1,104,064 958,834 739,672 772,608 471,236
Total Unreserved 1,104,064 958,834 739,672 795,500 1,174,243
Total Fund Balances 5,538,988 5,425,583 5,258,130 5,266,353 5,516,435
Total Liabilities and Fund Balances $5,755,124 $5,468,262 $5,335,429 $5,381,319 $5,618,474
Data Presented is Extracted from City's Independent Audit Reports for Purposes of Additional Analysis
See Audit Reports for Complete Information
CITY OF ITHACA
COMPARATIVE BALANCE SHEET
WATER FUND
DECEMBER 31,
- 7 -
REVENUES 2014 2013 2012 2011 2010
Departmental income $4,344,618 $4,044,086 $3,930,294 $3,489,485 $3,072,787
Intergovernmental charges 173 600 3,003 2,182 927
Use of money and property 5,297 6,711 8,737 13,462 21,812
Sale of property and compensation for loss 9,228 6,611 2,881 9,179 38,637
Miscellaneous local sources -0-239 1,757 -0-2,767
State sources 10,000 25,000 10,254 5,031 -0-
Total Revenues 4,369,316 4,083,247 3,956,926 3,519,339 3,136,930
Other Financing Sources:
Interfund transfers 12,500 30,000 50,000 70,000 30,000
Total Revenues and Other Sources 4,381,816 4,113,247 4,006,926 3,589,339 3,166,930
EXPENDITURES
Current:
General governmental support 165,133 152,837 108,697 94,274 94,455
Home and community services 2,117,517 2,094,501 2,093,447 2,043,647 1,722,945
Employee benefits 906,224 895,611 879,709 820,234 615,105
Debt service (principal and interest)773,537 490,845 604,179 541,971 495,081
Total Expenditures 3,962,411 3,633,794 3,686,032 3,500,126 2,927,586
Other Financing Uses:
Interfund transfers 306,000 312,000 329,117 339,295 335,936
Total Expenditures and Other Uses 4,268,411 3,945,794 4,015,149 3,839,421 3,263,522
Excess of Revenues (Expenditures) 113,405 167,453 (8,223)(250,082)(96,592)
Fund Balance, Beginning 5,425,583 5,258,130 5,266,353 5,516,435 5,613,027
Fund Balance, Ending $5,538,988 $5,425,583 $5,258,130 $5,266,353 $5,516,435
Data Presented is Extracted from City's Independent Audit Reports for Purposes of Additional Analysis
See Audit Reports for Complete Information
COMPARATIVE STATEMENTS OF REVENUES, EXPENDITURES,
AND CHANGES IN FUND BALANCE - WATER FUND
FOR THE YEAR ENDED DECEMBER 31,
- 8 -
CITY OF ITHACA
ASSETS 2014 2013 2012 2011 2010
Assets:
Cash and cash equivalents - Unrestricted $579,400 $210,248 $-0-$-0-$32,062
- Restricted 2,449,197 2,445,954 2,441,995 2,436,857 2,429,112
Investments 42,795 -0--0--0--0-
Due from other funds -0-96,221 88,785 298,406 392,334
Due from other governments 86,951 86,951 321,532 86,951 140,162
Other receivables, net 1,220,540 1,248,804 1,199,163 1,377,539 944,252
Prepaid expenses 122,107 156,645 160,648 130,229 88,343
Inventories 86,142 84,253 72,711 82,284 79,653
Total Assets $4,587,132 $4,329,076 $4,284,834 $4,412,266 $4,105,918
LIABILITIES AND FUND BALANCES
Liabilities:
Accounts payable and other $29,379 $32,375 $206,037 $396,172 $36,073
Due to other funds 688,043 508,613 554,396 367,477 307,497
Other liabilities 92 92 92 82 150
Due to other governments 12,000 12,000 14,410 14,590 25,502
Total Liabilities 729,514 553,080 774,935 778,321 369,222
Fund Balances:
Fund Balances - Reserved:
Encumbrances 4,225 12,141 50,023 9,100
Inventory/Prepaid expenses 208,249 240,898 233,359 212,513 167,996
Capital 2,449,197 2,445,954 2,441,995 2,436,857 2,429,112
Insurance 42,795 42,709 42,607 42,517 42,381
Total Reserved 2,700,241 2,733,786 2,730,102 2,741,910 2,648,589
Fund Balances - Unreserved:
Appropriated - Ensuing year's budget -0--0--0--0-231,435
Unappropriated 1,157,377 1,042,210 779,797 892,035 856,672
Total Unreserved 1,157,377 1,042,210 779,797 892,035 1,088,107
Total Fund Balances 3,857,618 3,775,996 3,509,899 3,633,945 3,736,696
Total Liabilities and Fund Balances $4,587,132 $4,329,076 $4,284,834 $4,412,266 $4,105,918
Data Presented is Extracted from City's Independent Audit Reports for Purposes of Additional Analysis
See Audit Reports for Complete Information
COMPARATIVE BALANCE SHEET
SEWER FUND
DECEMBER 31,
- 9 -
CITY OF ITHACA
REVENUES 2014 2013 2012 2011 2010
Departmental income $5,811,904 $5,925,656 $5,718,893 $5,505,736 $5,235,636
Intergovernmental charges 16,345 19,182 26,037 41,912 21,105
Use of money and property 3,915 4,324 5,602 8,320 12,267
Sale of property and compensation for loss 3,679 2,934 3,810 15,855 42,165
Miscellaneous local sources -0--0--0--0-5,139
Total Revenues 5,835,843 5,952,096 5,754,342 5,571,823 5,316,312
Other Financing Sources:
Interfund transfers 26,500 100,000 111,000 200,000 90,000
Total Revenues and Other Sources 5,862,343 6,052,096 5,865,342 5,771,823 5,406,312
EXPENDITURES
Current:
General governmental support 205,881 195,480 133,406 118,234 115,666
Home and community services 2,959,773 3,008,154 3,130,681 3,193,281 2,947,127
Employee benefits 1,317,920 1,532,790 1,514,320 1,435,507 1,060,319
Debt service (principal and interest)937,147 683,575 833,290 738,179 702,073
Total Expenditures 5,420,721 5,419,999 5,611,697 5,485,201 4,825,185
Other Financing Uses:
Interfund transfers 360,000 366,000 377,691 389,373 385,518
Total Expenditures and Other Uses 5,780,721 5,785,999 5,989,388 5,874,574 5,210,703
Excess of Revenues (Expenditures)81,622 266,097 (124,046)(102,751)195,609
Fund Balance, Beginning 3,775,996 3,509,899 3,633,945 3,736,696 3,541,087
Fund Balance, Ending $3,857,618 $3,775,996 $3,509,899 $3,633,945 $3,736,696
Data Presented is Extracted from City's Independent Audit Reports for Purposes of Additional Analysis
See Audit Reports for Complete Information
AND CHANGES IN FUND BALANCE - SEWER FUND
FOR THE YEAR ENDED DECEMBER 31,
- 10 -
CITY OF ITHACA
COMPARATIVE STATEMENTS OF REVENUES, EXPENDITURES,
ASSETS 2014 2013 2012 2011 2010
Assets:
Cash and cash equivalents - Unrestricted $-0-$-0-$25,604 $-0-$60,005
Due from other funds 23,900 23,900 25,839 25,190 23,900
Other receivables, net 22,682 30,128 78,536 34,499 28,595
Prepaid expenses 11,164 11,856 13,128 9,535 9,535
Total Assets $57,746 $65,884 $143,107 $69,224 $122,035
LIABILITIES AND FUND BALANCES
Liabilities:
Accounts payable/overdaft $359,298 $269,350 $20,397 $79,614 $23,223
Due to other funds 44,987 34,455 171,290 36,505 116,509
Due to other governments 2,594 2,144 1,020 423 2,726
Other liabilities (447)(447)(463)(297)(252)
Total Liabilities 406,432 305,502 192,244 116,245 142,206
Fund Balances:
Fund Balances - Reserved:
Encumbrances -0--0--0--0-10,000
Prepaid expenses 11,164 11,856 13,128 9,535 9,335
Insurance 1,917 1,914 1,905 -0--0-
Total Reserved 13,081 13,770 15,033 9,535 19,335
Fund Balances - Unreserved:
Unappropriated (361,767)(253,388)(64,170)(56,556)(39,506)
Total Unreserved (361,767)(253,388)(64,170)(56,556)(39,506)
Total Fund Balances (Deficit)(348,686)(239,618)(49,137)(47,021)(20,171)
Total Liabilities and
Fund Balances (Deficit)$57,746 $65,884 $143,107 $69,224 $122,035
- 11 -
CITY OF ITHACA
COMPARATIVE BALANCE SHEET
REFUSE AND GARBAGE FUND
DECEMBER 31,
Data Presented is Extracted from City's Independent Audit Reports for Purposes of Additional Analysis
See Audit Reports for Complete Information
REVENUES 2014 2013 2012 2011 2010
Departmental income $501,489 $447,882 $467,605 $551,545 $486,035
Use of money and property 17 20 24 37 51
Total Revenues 501,506 447,902 467,629 551,582 486,086
Other Financing Sources:
Interfund transfers 52,301 82,000 87,000 99,345
Total Revenues and Other Sources 501,506 500,203 549,629 638,582 585,431
EXPENDITURES
Current:
Home and community services 419,587 426,966 453,020 452,945 459,559
Employee benefits 179,008 161,942 170,405 171,902 136,660
Debt service (principal and interest)11,979 12,068 15,912 15,851 16,062
Total Expenditures and Other Uses 610,574 600,976 639,337 640,698 612,281
Excess of (Expenditures)(109,068)(100,773)(89,708)(2,116)(26,850)
Fund Balance (Deficit), Beginning (239,618)(138,845)(49,137)(47,021)(20,171)
Fund Balance (Deficit), Ending $(348,686)$(239,618)$(138,845)$(49,137)$(47,021)
Data Presented is Extracted from City's Independent Audit Reports for Purposes of Additional Analysis
See Audit Reports for Complete Information
AND CHANGES IN FUND BALANCE - REFUSE AND GARBAGE FUND
FOR THE YEAR ENDED DECEMBER 31,
- 12 -
CITY OF ITHACA
COMPARATIVE STATEMENTS OF REVENUES, EXPENDITURES,
CITY OF ITHACA
Ithaca, New York
FINANCIAL REPORT
December 31, 2014
CITY OF ITHACA
TABLE OF CONTENTS
FOR THE YEAR ENDED DECEMBER 31, 2014
Independent Auditor’s Report ............................................................................................................1-2
Required Supplementary Information
Management’s Discussion and Analysis .........................................................................................3-3k
Basic Financial Statements
Government-wide Financial Statements
Statement of Net Position .............................................................................................................4-4a
Statement of Activities ..................................................................................................................5
Governmental Fund Financial Statements
Balance Sheet -Governmental Funds ..........................................................................................6-6a
Reconciliation of Governmental Funds Balance Sheet to the Statement of Net Position ..........7
Statement of Revenues, Expenditures, and Changes in Fund Balances -
Governmental Funds ..................................................................................................................8-8a
Reconciliation of Governmental Funds Statement of Revenues, Expenditures,
and Changes in Fund Balances to the Statement of Activities .................................................9
Statement of Fiduciary Net Position -Fiduciary Fund ................................................................10
Notes to Financial Statements ....................................................................................................11-43
Required Supplementary Information
Budgetary Comparison Schedule (Non-GAAP) -General Fund ...................................................44
Budgetary Comparison Schedule (Non-GAAP) -Budgeted Major Special Revenue Funds .......45-46
Schedule of Funding Progress ..........................................................................................................47
Notes to Required Supplementary Information ..............................................................................48
Supplementary Information
Combining Balance Sheet -Non-Major Governmental Funds ......................................................49-49a
Combining Statement of Revenues, Expenditures, and Changes in Fund Balances -
Non-Major Governmental Funds .................................................................................................50-50a
Reports Required Under Government Auditing Standards
In dependent Auditor's 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 ......................................................................51-52
Reports Required Under the Single Audit Act (OMB Circular A-133)
In dependent Auditor's Report on Compliance for Each Major Program and on
Internal Control Over Compliance Required by OMB Circular A-133 ......................................53-54
Schedule of Expenditures of Federal Awards .................................................................................55
Notes to Schedule of Expenditures of Federal Awards ..................................................................56
Schedule of Findings and Questioned Costs ...................................................................................57-59
INDEPENDENT AUDITOR’S REPORT
Common Council
City of Ithaca
Ithaca, New York
Report on the Financial Statements
We have audited the accompanying financial statements of the governmental activities, each major fund, and the aggregate
remaining fund information of the City of Ithaca (the City), as of and for the year ended December 31, 2014, and the related
notes to the financial statements, which collectively comprise the City’s basic financial statements as listed in the table of
contents.
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
Our responsibility is to express opinions on these financial statements based on our audit. We conducted our audit in
accordance with auditing standards generally accepted in the United States of America and the standards applicable to
financial audits contained in Government Auditing Standards, issued by the Comptroller General of the United States.
Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial
statements are free 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 on the
effectiveness of the entity’s internal control. Accordingly, we express no such opinion. An audit also includes evaluating
the appropriateness of accounting policies used and the reasonableness of significant accounting estimates made by
management, as well as evaluating the overall presentation of the financial statements.
We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinions.
Opinions
In our opinion, based on our audit, the financial statements referred to above present fairly, in all material respects, the
respective financial position of the governmental activities, each major fund, and the aggregate remaining fund information
of the City of Ithaca, as of December 31, 2014, and the respective changes in financial position and, where applicable, cash
flows thereof for the year then ended in accordance with accounting principles generally accepted in the United States of
America.
Prior Period Financial Statements
The financial statements of the City of Ithaca as of December 31, 2013 were audited by Ciaschi, Dietershagen, Little,
Mickelson & Company, LLP who merged with Insero & Co. CPAs, LLP as of January 1, 2016, and whose report dated
September 9, 2015, expressed an unmodified opinion on those statements.
- 1 -
Insero & Co. CPA s, LLP
Rochester | Ithaca | Corning | Cortland | Watkins Glen | (800) 232-9547 | www.inserocpa.com
- 2 -
Other Matters
Required Supplementary Information
Accounting principles generally accepted in the United States of America require that the Management’s Discussion and
Analysis, budgetary comparison information, and Schedule of Funding Progress on pages 3 – 3k, and 44 - 48 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 financial reporting
for placing the basic financial statement s in an appropriate operational, economic, or historical context. We 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 our inquiries, the basic
financial statements, and other knowledge we obtained during our audit of the basic financial statements. We 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.
Other Information
Our audit was conducted for the purpose of forming opinions on the financial statements that collectively comprise the
City’s basic financial statements. The combining non -major fund financial statements are presented for purposes of
additional analysis and are not a required part of the basic financial statements. The accompanying Schedule of
Expenditures of Federal Awards is presented for purposes of additional analysis as required by U.S. Office of Management
and Budget Circular A-133, Audits of States, Local Governments, and Non-Profit Organizations, and is also not a required
part of the financial statements.
The combining and individual non-major fund financial statements and the Schedule of Expenditures of Federal Awards are
the responsibility of management and were derived from and relate directly to the underlying accounting and other records
used to prepare the basic financial statements. Such information has been subjected to the auditing procedures applied in
the audit of the basic financial statements and certain additional procedures, including comparing and reconciling such
information directly to the underlying accounting and other records used to prepare the basic financial statements or to the
basic financial statements themselves, and other additional procedures in accordance with auditing standards generally
accepted in the United States of America. In our opinion, the combining and individual non -major fund financial statements
and the Schedule of Expenditures of Federal Awards are fairly stated, in all material respects, in relation to the basic
financial statements as a whole.
Other Reporting Required by Government Auditing Standards
In accordance with Government Auditing Standards, we have also issued our report dated March 17, 2016, on our
consideration of the City of Ithaca’s internal control over financial reporting and on our tests of its compliance with certain
provisions of laws, regulations, contracts, and grant agreements and other matters. The purpose of that report is to describe
the scope of our testing of internal control over financial reporting and compliance and the results of that testing, and not to
provide an opinion on internal control over financial reporting or on compliance. That report is an integral part of an audit
performed in accordance with Government Auditing Standards in considering the City’s internal control over financial
reporting and compliance.
Respectfully Submitted,
Insero & Co. CPAs, LLP
Certified Public Accountants
Ithaca, New York
March 17, 2016
CITY OF ITHACA
MANAGEMENT’S DISCUSSION AND ANALYSIS
FOR THE YEAR ENDED DECEMBER 31, 2014
-3-
Our discussion and analysis of the City of Ithaca’s (the City) financial performance provides an overview
of the City’s financial activities for the fiscal year ended December 31, 2014. Please read it in conjunction
with the City’s financial statements, which begin on page 4.
FINANCIAL HIGHLIGHTS
The liability for other postemployment health benefits at December 31, 2014 is $102,545,205.
This liability is expected to grow each year as there is no legal mechanism in New York State to
fund it.
Assets of the City exceeded liabilities at the close of the most recent fiscal year by $14,768,352
(net position). Unrestricted net position showed a deficit of $(64,830,145)due to the accrual of
other postemployment health benefits. Without the effect of this accrual,unrestricted net position
would have been $37,715,060.Management has designated certain amounts of net position for
particular purposes. See Note 3.D for management’s designation of unrestricted net position.
The City’s expenses were $9,802,930 greater than the $69,524,812 generated in tax and other
revenues for all governmental program activities. Expense associated with the implementation of
GASB Statement No. 45 for the ye ar ending December 31, 2013 was $15,519,743, without which
revenues would have exceeded expenses by $5,716,813.
The City invested $18,807,554 in capital assets during the year, largely for the Ithaca Commons
project and improvements in its water plant and transportation system.
The General Fund recorded an operating decrease of $(428,880)in 2014 compared to a decrease of
$(168,631)in 2013 and had a fund balanceof $7,819,268 at ye ar-end. Although revenues
increased $1.7 million in 2014, expenditures increased $2.0 million, mostly in increased tax
revenue deferrals, employee benefits and transportation expenditures.
USING THIS ANNUAL REPORT
This annual report consists of a series of basic financial statements. The Statement of Net Position and
Statement of Activities (pages 4-5) provide information about the City as a whole and present a longer-
term view of the City’s finances. Governmental Fund financial statements start on page 6. These
statements,for Governmental Activities, tell how services were financed in the short term, as well as what
remains for future spending. Governmental Fund financial statements also report the City’s operations in
more detail than the Government-wide financial statements by providing information about the City’s
most significant funds.The remaining statements provide financial information about activities for which
the City acts solely as a trustee or agent for the benefit of those outside the government. Following these
statements are notes that provide additional information essential to a full understanding of the data
provided in the financial statements.
CITY OF ITHACA
MANAGEMENT’S DISCUSSION AND ANALYSIS
FOR THE YEAR ENDED DECEMBER 31, 2014
-3a-
In addition to basic financial statements, the annual report contains other information in the form of
budgetary comparison schedules for the General Fund and Budgeted Major Special Revenue Funds, as
well as combining statements for funds that are not considered Major Funds and, therefore, are not
presented individually in the basic financial statements. Other information consists of the Schedule of
Funding Progress related to the City’s liability for retiree health which is reported as other post-
employment benefits.
Reporting the City as a Whole
Our analysis of the City as a whole begins on page 4, with the Government-wide financial statements. The
Statement of Net Position and Statement of Activities report information about the City and about its
activities in a way that helps answer the question of whether the City, as a whole, is better or worse off as a
result of the year’s activities. 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 current year
revenues and expenses are taken into account regardless of when the cash is received or paid.
These two statements report the City’s net assets and changes in them. One can think of the City’s net
position, the difference between assets and liabilities, as one way to measure the City’s financial health, or
financial position. Over time, increases or decreases in the City’s net position is one indicator of whether
its financial health is improving or deteriorating. One will need to consider other nonfinancial factors
however, such as changes in the City’s property tax base and the condition of the City’s infrastructure, to
assess the overall health of the City.
In the Statement of Net Position and Statement of Activities, all of the City’s activities which are
governmental in nature are reported in one column including general governmental support, public safety,
transportation, economic assistance and opportunity, culture and recreation, home and community services
and interest on long-term debt. Property and sales taxes, and state and federal grants finance most of these
activities.
Reporting the City’s Most Significant Funds
Governmental Fund Financial Statements
Analysis of the City’s Major Funds begins on page 6. The Governmental 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. However, management establishes many other funds to help it
control and manage money for particular purposes or to show it is meeting legal responsibilities for using
certain taxes and grants.
CITY OF ITHACA
MANAGEMENT’S DISCUSSION AND ANALYSIS
FOR THE YEAR ENDED DECEMBER 31, 2014
-3b-
Governmental Funds: All of the City’s services are reported in the Governmental Funds, which
focus on how money flows in and out of those funds,and the balances left at year end that are
available for spending. These funds are reported using an accounting method called modified accrual
accounting which measures cash and all other financial assets that can be readily converted to cash.
The Governmental Fund financial statements provide a detailed short-term view of the City’s general
governmental operations and the basic services it provides. Governmental Fund information helps
determine whether there are more or fewer financial resources that can be spent in the near future to
finance City programs. The relationship (or differences) between Governmental Activities (reported in
the Government-wide financial statements) and Governmental Funds is explained in a reconciliation
following the Governmental Fund financial statements.
The City as Trustee: The City is the trustee, or fiduciary, for other assets held on behalf of others.
All of the City’s Fiduciary Activities are reported in a separate Statement of Fiduciary Net Position -
Fiduciary Fund on page 10. We exclude these activities from the City’s other financial statements
because the City cannot use these assets to finance its operations. The City is responsible for ensuring
the assets reported in this fund are used for their intended purposes.
Component Unit. The City includes one separate legal entity in its report, the It haca Urban Renewal
Agency (IU RA). Although legally separate, this “component unit” is important because the City is
financially accountable for it. Complete financial statements for the IURA can be obtained by
contacting the IURA at 108 East Green Street, Ithaca. NY 14850.
THE CITY AS A WHOLE
A portion of the City’s net position reflects its investment in capital assets (e.g. land, buildings, machinery,
equipment and infrastructure) less any related debt used to acquire those assets that is still outstanding.
The City uses these capital assets to provide services to citizens; consequently, these assets are not
available for future spending.Although the City’s investment in capital assets is reported net of related
debt, it should be noted that the resources needed to repay this debt must be provided by other sources, as
the capital assets themselves cannot be used to liquidate these liabilities.
An additional portion of the City’s net position represents resources subject to external restrictions on how
they may be used and are reported as restricted. The remaining category of total resources is unrestricted,
totaling $(64,830,145). Included in unrestricted net position is the City’s equity interest in two joint
ventures of $12,940,645.
CITY OF ITHACA
MANAGEMENT’S DISCUSSION AND ANALYSIS
FOR THE YEAR ENDED DECEMBER 31, 2014
-3c -
Our analysis below focuses on the net position (Figure 1)and changes in net position (Figure 2)of the
City’s Governmental Activities.
Figure 1
Net Position
Governmental Activities and
Total Government Dollar Change
Percent
Change
Restated 2013 2014 2013-2014 2013-2014
Current assets $ 52,841,947 $ 62,479,666 $ 9,637,719 18%
Noncurrent assets 26,597,517 28,015,191 1,417,674 5%
Capital assets, net 139,035,453 149,866,547 10,831,094 8%
Deferred outflows of resources 346,381 919,596 573,215 165%
Total Assets and
Deferred Outflows 218,821,298 241,281,000 22,459,702 10%
Current liabilities 40,224,663 62,915,322 22,690,659 56%
Noncurrent liabilities 154,025,353 163,597,326 9,571,973 6%
Total Liabilities 194,250,016 226,512,648 32,262,632 17%
Net investment in capital assets 60,349,477 60,391,316 41,839 0%
Restricted 17,789,053 19,207,181 1,418,128 8%
Unrestricted (53,567,248)(64,830,145)(11,262,897)-21%
Total Net Position $ 24,571,282 $ 14,768,352 $(9,802,930)-40%
Current assets consist largely of $46,017,532 in unrestricted cash, $560,018 of cash restricted for various
purposes, receivables of $12,028,969, and $2,070,500 in prepaid expenses and inventory. Noncurrent
assets consist of cash restricted for future noncurrent expenses of $8,796,434, the long-term portion of
loans receivable of $6,278,112 and the City’s equity interest in joint ventures of $12,940,645.The
increase in current assets is largely due to the result of proceeds of debt and other sources to fund capital
projects,as well as the timing of receivables and payables. Capital assets, net of accumulated
depreciation,increased as a result of the City’s investment in buildings and infrastructure.
Included in current liabilities are Bond Anticipation Notes (BANs)payable of $50,275,293, the current
portion of long-term liabilities of $5,258,158 and various payables of $7,381,871. Noncurrent liabilities
consist of bonds payable of $56,251,411,compensated absences of $2,456,029, other postemployment
benefits payable of $102,545,205 and lease obligations of $2,344,681. The increase in current liabilities is
primarily due to issuing additional BANs to fund capital projects. Noncurrent liabilities increased as a
result of the increase in the liability for other postemployment benefits of $15,519,743 offset by the
scheduled payment of debt.
The amount of net investment in capital assets increased slightly overall due to the change in capital assets
offset by an increase in the amount of debt incurred to fund capital projects. Restricted net position
consists largely of $3,612,714 for debt service, $8,834,190 for home and community service programs,
$6,740,356 for future capital projects, and $19,921 for cultural and recreational programs as of
December 31,2014.
CITY OF ITHACA
MANAGEMENT’S DISCUSSION AND ANALYSIS
FOR THE YEAR ENDED DECEMBER 31, 2014
-3d-
Figure 2 demonstrates the operations of the City’s activities.
Figure 2
Changes in Net Position
Governmental Activities and
Total Government
Dollar Percent
Changes in Net Assets Change Change
Restated 2013 2014 2013-2014 2013-2014
REVENUES
Program Revenues:
Charges for services $ 19,862,260$20,678,882 $ 816,6224%
Operating grants 2,912,872 2,817,838 (95,034)-3%
Capital grants 3,279,574 6,686,974 3,407,400104%
General Revenues:
Property taxes and tax items 20,828,35021,313,664 485,3142%
Nonproperty taxes 13,272,70014,740,925 1,468,22511%
State sources 3,388,841 3,220,841 (168,000)-5%
Use of money and property 345,724 317,564 (28,160)-8%
Change in equity interest in
joint venture (1,547,821)(1,441,892) 105,929-6%
Other 1,079,107 1,190,016 110,90910%
Total Revenues 63,421,607 69,524,812 6,103,205 10%
PROGRAM EXPENSES
General government 8,140,506 9,853,689 1,713,18321%
Public safety 31,582,88829,108,980 (2,473,908)-8%
Transportation 10,536,03411,738,493 1,202,45911%
Economic assistance
and opportunity 61,000 61,000 -0-0%
Culture and recreation 12,008,70911,405,983 (602,726)-5%
Home and community services 14,050,97613,496,066 (554,910)-4%
Interest on long-term debt 2,459,999 3,663,531 1,203,53249%
Total Expenses 78,840,112 79,327,742 487,630 1%
(DECREASE) IN NET POSITION $(15,418,505)$(9,802,930)$ 5,615,575 -36%
Governmental Activities
The net position of the City’s activities decreased significantly due to the increase in the liability of other
postemploym ent benefits. Charges for services showed an increase due to increased charges for water and
sewer services. Capital grants were up due to funding for the Commons project. Since the capital outlay
associated with the Commons project is capitalized and not expensed, this grant income is largely the
reason for the more favorable result compared to 2013.
CITY OF ITHACA
MANAGEMENT’S DISCUSSION AND ANALYSIS
FOR THE YEAR ENDED DECEMBER 31, 2014
-3e-
Property tax and tax items increased 2% compared to an increase of 3%in 2013. Nonproperty taxes were
up in 2014 as compared to 2013. Sales tax revenue continues to increase ($600,000), asa result of
increasing development. Also contributing to the increase in nonproperty taxes was charges for sidewalk
improvements in a new fund, Sidewalk Improvement District Fund. The change in the City’s equity
interest in joint ventures is dependent on those entity’s yearly operating results. See Note 4 for more
information about the City’s joint ventures.
Overall expenses were up largely due to increases in health insurance and retirement costs. Expenses in
general government support increased largely due to personnel costs and changes in deferred tax revenue.
Public safety expenses decreased largely due to lower personnel costs, including employee benefits.
Transportation expenses increased due to increased contractual and personnel costs, including employee
benefits. Interest on debt increased as a result of the timing of payments and an increase in the accrual at
year-end.
Figure 3
Revenue by Source
2014
Ch arges for
serv ic es
29.74%
Op erating grants
4.05%
Ca pital grants
9.62%
Pro pert y an d tax
it ems
30.66%
No nproperty taxes
21.20%
Un re stric ted St ate
sources
4.63%
Us e of money and
propert y
0.46%
Ch ange in equity
in teres t in joint
ventures
(2.07)%
Ot her
1.71%
Revenue by Source
2013
Ch arges for
serv ic es
31.31%
Op erating grants
4.59%
Ca pital grants
5.17%
Pro perty and tax
it ems
32.83%
No npropert y taxes
20.92%
Un re stric ted St ate
sources
5.34%
Us e of money and
property
0.54%
Ch ange in equity
in teres t in joint
ventures
(2.40)%
Ot her
1.70%
CITY OF ITHACA
MANAGEMENT’S DISCUSSION AND ANALYSIS
FOR THE YEAR ENDED DECEMBER 31, 2014
-3f-
The cost of all Governmental Activities in 2014 in the Statement of Activities was $79,327,742.
However, as shown in the Statement of Activities the amount ultimately financed for these activities
through City property and payments in lieu of taxes was $49,144,048, because some of the cost was paid
by those who directly benefited from the programs $(20,678,882) or by other governments and
organizations that subsidized certain programs with grants and contributions $(9,504,812). Overall, City
governmental program revenues, including fees for services and grants, were $30,183,694. The City paid
for the remaining “public benefit” portion of Governmental Activities with $39,341,118 in taxes and other
revenues, such as interest and general entitlements.
Total cost and revenue comparison of the Governmental Activities for each of the City’s largest programs
is presented below. Note that the City’s home and community service activities which provide water and
sewer services include debt service costs in their fee structures. Because debt service costs are not
expenses of this function,excess revenue generated by these activities is used to make debt principal and
interest payments.
Figure 4
Program Cost and Revenue Comparison -Governmental Activities
2014
0
4,000,000
8,000,000
12,000,000
16,000,000
20,000,000
24,000,000
28,000,000
32,000,000
Cost
Revenue
2013
0
4,000,000
8,000,000
12,000,000
16,000,000
20,000,000
24,000,000
28,000,000
32,000,000
Cost
Revenue
CITY OF ITHACA
MANAGEMENT’S DISCUSSION AND ANALYSIS
FOR THE YEAR ENDED DECEMBER 31, 2014
-3g-
THE CITY’S FUNDS
As the City completed the year, its Governmental Funds, as presented in the balance sheets on pages 6-6a,
reported a combined fund balance of $13,734,276, which is less than last year’s total of $22,483,016,
largely as a result of short-term financing in the Capital Fund.
Figure 5 shows changes in fund balance for the year for the City's funds.
Figure 5
Governmental Funds
Fund Balance at Year Ending
Governmental Fund Balances
Dollar Percent
Restated Change Change
2013 2014 2013-2014 2013-2014
General Fund 8,248,148 7,819,268 (428,880)-5%
Water Fund 5,425,583 5,538,988 113,405 2%
Sewer Fund 3,775,996 3,857,618 81,622 2%
Special Grant Fund 1,766,466 2,003,800 237,33413%
Capital Projects Fund (149,067)(9,450,069)(9,301,002)-6,239%
Non-Major Funds:
Refuse and Garbage Fund (239,618)(348,686)(109,068)46%
Sidewalk Improvement Fund -0- 503,444 503,444N/A
Debt Service Fund 3,458,329 3,612,714 154,385 4%
Misc. Special Revenue Fund 22,901 22,921 20 0%
Urban Renewal Fund 125,000 125,000 -0-0%
Permanent Fund 49,278 49,278 -0-0%
Totals 22,483,016 13,734,276 (8,748,740)-39%
General Fund Budgetary Highlights
Over the course of the year, the Common Council as well as the management of the City revised the City
General Fund budget several times. These budget amendments consist of transfers between functions,
encumbrances from the prior fiscal year and acceptance of grant awards.
Revenue available for appropriation was below the final budgeted amount by $(195,148). Transfers in
were budgeted for $1,362,208 but;only $1,179,643 was actually transferred. The actual charges to
appropriations (expenditures) were below the final budget amounts by $581,855.
CITY OF ITHACA
MANAGEMENT’S DISCUSSION AND ANALYSIS
FOR THE YEAR ENDED DECEMBER 31, 2014
-3h-
CAPITAL ASSET AND DEBT ADMINISTRATION
Capital Assets
At December 31, 2014, the City had $149,866,547, net of accumulated depreciation of $118,938,147,
invested in a broad range of capital assets, including buildings, machinery and equipment, roads and
bridges. This amount represents a net increase (including additions of $18,807,554,depreciation
expense of $7,956,254, and net book value of disposed assets of $20,206) or$10,831,094, or 8%over
2013. Most of the increase was due to additions in construction in progress for improvements to the
Commons project, water plant and transportation infrastructure.
Figure 6
Capital Assets, Net of Depreciation
Governmental Activities and
Total Government Dollar Change
Percent
Change
2013 2014 2013-2014 2013-2014
Land $13,719,491 $13,739,191 $ 19,700 0%
Construction in progress 8,524,321 13,319,163 4,794,842 56%
Buildings and improvements 27,170,086 25,719,720 (1,450,366)-5%
Equipment 7,951,182 7,309,313 (641,869)-8%
Infrastructure 81,670,373 89,779,160 8,108,787 10%
Totals $139,035,453 $149,866,547 $ 10,831,094 8%
Debt Administration
Debt (bonds, BANs, and lease obligations payable), considered a liability of Governmental Activities,
increased overall by $14,741,276. Accrued compensated absences increased by $91,884, while the
liability for other postemployment benefits increased $15,519,743, bringing total debt and long-term
liabilities to $219,130,777 as of December 31, 2014, as shown in Figure 7. Of the amount of bonds,
BANs, and capital leases outstanding, $77,342,741 is subject to the constitutional debt limit and
represented 73%of the City’s statutory debt limit. The City’s bond rating was assigned an Aa2 by
Moody’s. More detailed information about the City’s liabilities is presented in Notes 3-B-2 and 3 to the
financial statements.
CITY OF ITHACA
MANAGEMENT’S DISCUSSION AND ANALYSIS
FOR THE YEAR ENDED DECEMBER 31, 2014
-3i-
Figure 7
Outstanding Debt and Long-term Liabilities at Year Ending
Governmental Activities and
Total Government Dollar Change
Percent
Change
2013 2014 2013 -2014 2013 -2014
BANs $31,487,732$50,275,293$ 18,787,56160%
Serial Bonds 64,753,40161,044,557 (3,708,844)-6%
Compensated absences 2,484,0672,575,951 91,884 4%
Other postemployment
benefits payable 87,025,462102,545,205 15,519,74318%
Lease obligation payable 3,027,2122,689,771 (337,441)-11%
Totals $188,777,874 $219,130,777 $ 30,352,903 16%
ECONOMIC FACTORS AND NEXT YEAR’S BUDGETS AND RATES
The City considered many factors when developing and adopting the budget for fiscal year ended
December 31, 2015. Two of these factors were State and local economies. The unemployment rate in
Tompkins County continues to be the lowest in the State. However, the City is expected to face a difficult
and uncertain economic environment for the next few years. In addition, New York State retirement costs
continue to be high, with lower rates forecast for the next few years.Also, higher health care costs, a high
debt load and related debt service costs, higher labor costs, uncertain sales tax collections, and level state
aid payments are all factors that will strain future budgets. The one positive sign for the future is that
projects inside the City slated for development continue to be active. While it will take time for these
projects to construct,future development and related property tax in the City looks strong.
The following is a summary of currently known facts, decisions, or conditions expected to have a
significant effect on the City’s financial position:
Sales Tax: Commercial development in the City is higher, with several projects expected to start
construction during 2015 and 2016. In 2015, we budgeted a 2.3% increase in sales tax revenue based
on the expected increase in development. Trying to pinpoint the sales tax revenue amount is difficult
due to the continued uncertain economic climate and changes in the City's development. The 2014
revenue was 2% overthe budget. Sales tax revenue in the future will remain uncertain.
Taxable Assessments: We will continue to see increasing assessments for the next few years as a
result of increased development. 2015 taxable assessments will increase by 6.16%. Our tax rate for
2015 will lower by 1.75% to $12.89.
Building Permits: In 2015, we budgeted a level $700,000 in building permit revenues. This amount
was based on several larger development projects starting in 2015 and our previous history of revenue
collection in this area.
CITY OF ITHACA
MANAGEMENT’S DISCUSSION AND ANALYSIS
FOR THE YEAR ENDED DECEMBER 31, 2014
-3j-
Cornell University Contribution: The City and Cornell University signed an amended memorandum
of understanding in November 2003. Cornell University contributions are now increased by the
Consumer Price In dex (CPI). The CPI is estimated to be approximately 0% for 2015. The total 2014
contribution amount increased by 1.50% due to a positive CPI.
Employee Pension Rates: The State has informed the City that 2015 pension costs will be $4,907,539.
The City has budgeted fully and not bonded any of this cost. This rate represents a $(404,659)
decrease from 2014 contribution levels. Pension rates are expected to remain high for the next few
years. Overall, the City expects current staffing levels to be maintained with labor costs slowly
increasing. The State has estimated lower rates in the near future.
Health Insurance Costs: Health insurance costs continue to increase. The estimated premium cost for
health insurance is expected to increase by 5.0% in 2015. This cost will be partially offset by
employee contributions. The 2015 budgeted health insurance costs will exceed $10.4 million. We
continue to participate in a health consortium which will, hopefully, stabilize our premium rates in the
near future. We continue to look at various opportunities to make changes to our current health plan in
hopes of finding cost savings and cost control measures.
Debt Service Costs: The debt load for the City continues to be high. Our outstanding debt, including
installment debt, at December 31, 2015 was $134,004,473. In 2014, the City added another $8 million
in debt for the Water Treatment Rebuild project, the Commons Improvement project, and the
Wastewater Treatment project. The Commons project is expected to be completed in 2015, the water
plant in 2017, and the wastewater plant in 2017. We have leveraged large amounts of State and
Federal aid for the Commons, wastewater, bridge and street projects to keep the City costs share as
low as possible. The City needed to bond for highway, water, and sewer improvements in the
Southwest Area. These large scale infrastructure improvements of approximately $10 million, will
have a significant impact on the City budget for the next 13 years. In addition, a $13.2 million rebuild
of the Green Street Parking Garage was issued as debt in 2006 and 2009. Lastly, many of the City's
facilities are in need of significant updates and renovations. A concentrated effort to reduce the overall
debt load is ongoing. However, with many infrastructure improvements necessary in the City and the
need to limit tax rates, reducing debt will be a challenge.
Cayuga Parking Garage: Under a complicated agreement, the City is obligated to pay the deficit of
operations related to the Cayuga Parking Garage. The total coverage cost was $19 million. The 2015
payment will be $1,011,000. We expect this payment to become constant over time at approximately
$950,000.
CITY OF ITHACA
MANAGEMENT’S DISCUSSION AND ANALYSIS
FOR THE YEAR ENDED DECEMBER 31, 2014
-3k -
Tax Exempt Property: The City has an exceptionally high tax exempt property rate, primarily related
to Cornell University. Since 1991, the tax exempt property rate in the City ranged from 56% and 72%;
for 2015 the percentage of tax exempt property inside the City was 59.20%. As a result of the high
rate, the remaining tax base must pick up a majority of the overall City operating costs. The City
continues to discuss this problem with both Cornell University and New York State to find some
mitigation to the problem. This on-going issue leaves our rate high.
State Revenue Aid: New York State cut the City’s state general revenue aid in the early 1990’s by
over $1 million. Since that time the City has struggled to recover financially. In addition, aid
payments to the City remained fairly constant until 2005 when general revenue aid started increasing.
Although the State promised increase aid to municipalities for several more years, the State’s current
weak financial position has made it impossible for the State to keep that promise. State aid began
decreasing in 2009 and is expected to remain flat or decrease over the next several years. In 2015,
State general revenue aid will be $2,610,000. This amount is about the same as our State aid in 1991.
After considering inflation, we think our payment should be $4.9 million. We believethe State needs
to adjust the aid formulato account for tax exempt property.
City Surplus Property: The City has inventoried its property and has determined several pieces of
vacant property can be sold over the next three years. In 2012, the City budgeted $125,000 for the sale
of land. In 2013, the City budgeted $232,000; in 2014, we budgeted $197,000. During this period, we
collected $352,000 in revenue from the sale of property. In 2015, we budgeted $400,000 in sale of
property, mainly from the sale of land for a hotel inside the City. While it has taken longer than
anticipated to sell these properties, we expect to meet budget in 2015.
The above items were all taken into account when adopting the General Fund Budget for the fiscal year
ending December 31, 2015.
CONTACTING THE CITY’S FINANCIAL MANAGEMENT
This financial report is designed to provide our citizens, taxpayers, customers, and investors and creditors
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 the report or need any additional financial information, contact
Steven P. Thayer, City Controller, First Floor, City Hall, 108 East Green Street, Ithaca, New York 14850.
Governmental
Activities
ASSETS
Current Assets:
Cash and cash equivalents $46,017,532
Restricted cash and cash equivalents 560,018
Investments 1,802,647
Taxes receivable, net 927,452
Due from state and federal governments 6,540,145
Due from other governments 1,055,684
Other receivables, net 3,005,688
Loans receivable, short-term portion 500,000
Inventories 778,036
Prepaid expenses 1,292,464
Total Current Assets 62,479,666
Noncurrent Assets:
Restricted cash and cash equivalents 8,796,434
Loans receivable, long-term portion 6,278,112
Equity interest in joint ventures 12,940,645
Capital Assets:
Land and construction in progress 27,058,354
Depreciable capital assets, net 122,808,193
Total Noncurrent Assets 177,881,738
Total Assets 240,361,404
DEFERRED OUTFLOWS OF RESOURCES
Deferred Outflows of Resources:919,596
Deferred charge on refunding
Total Deferred Outflows of Resources 919,596
See Independent Auditor's Report and Notes to Financial Statements.
- 4 -
CITY OF ITHACA
STATEMENT OF NET POSITION
DECEMBER 31, 2014
Governmental
Activities
LIABILITIES
Current Liabilities:
Accounts payable $4,612,271
Accrued liabilities 9,905
Due to other governments 762,115
Bond Anticipation Notes payable 50,275,293
Unearned revenue 209,488
Accrued interest payable 1,267,383
Other 520,709
Current Portion of Long-term Liabilities:
Bonds payable 4,793,146
Lease obligations payable 345,090
Compensated absences 119,922
Total Current Liabilities 62,915,322
Long-term Liabilities:
Bonds payable 56,251,411
Lease obligations payable 2,344,681
Other postemployment benefits payable 102,545,205
Compensated absences 2,456,029
Total Long-term Liabilities 163,597,326
Total Liabilities 226,512,648
NET POSITION
Net investment in capital assets 60,391,316
Restricted, nonexpendable, for home and community services 49,278
Restricted, expendable, for home and community services 8,784,912
Restricted, expendable, for capital 6,740,356
Restricted, expendable, for culture and recreation 19,921
Restricted, expendable, for debt 3,612,714
Unrestricted (deficit)(64,830,145)
Total Net Position $14,768,352
See Independent Auditor's Report and Notes to Financial Statements
STATEMENT OF NET POSITION
- 4a -
CITY OF ITHACA
DECEMBER 31, 2014
Revenue and
Changes in
Operating Capital Net Position
Charges for Grants and Grants and Governmental
Expenses Services Contributions Contributions Activities
Governmental Activities:
General governmental support $9,853,689 $246,268 $575,795 $$(9,031,626)
Public safety 29,108,980 4,656,675 922,245 (23,530,060)
Transportation 11,738,493 2,320,328 5,731,415 (3,686,750)
Economic assistance and opportunity 61,000 (61,000)
Culture and recreation 11,405,983 1,751,791 347,303 (9,306,889)
Home and community services 13,496,066 11,703,820 972,495 955,559 135,808
Interest on long-term debt 3,663,531 (3,663,531)
Total Governmental Activities $79,327,742 $20,678,882 $2,817,838 $6,686,974 (49,144,048)
GENERAL REVENUES
Real property taxes 20,515,747
Real property tax items 797,917
Nonproperty tax items 14,740,925
Use of money and property 317,564
Sale of property and compensation for loss 197,620
Miscellaneous local sources 992,396
State sources 3,220,841
(1,441,892)
Total General Revenues and Contributions 39,341,118
Change in Net Position (9,802,930)
Net Position - Beginning, as restated 24,571,282
Net Position - Ending $14,768,352
See Independent Auditor's Report and Notes to Financial Statements.
Change in equity interest in joint ventures
CITY OF ITHACA
STATEMENT OF ACTIVITIES
FOR THE YEAR ENDED DECEMBER 31, 2014
- 5 -
Net (Expense)
FUNCTIONS/PROGRAMS
Program Revenues
General Water Sewer Special Grant
Fund Fund Fund Fund
ASSETS
Assets:
Cash and cash equivalents - Unrestricted $3,782,111 $316,372 $579,400 $1,043,344
Temporary investments 1,706,657 53,195 42,795
Taxes receivable, net 927,452
Due from other funds 500,784 38,603
Due from state and federal governments 926,763 10,000
Due from other governments 968,733 86,951
Other receivables, net 399,645 957,383 1,220,540 7,359
Inventory 197,290 494,604 86,142
Prepaid expenses 1,075,446 81,389 122,107
Cash and cash equivalents - Restricted 487,581 3,803,578 2,449,197 2,003,800
Loans receivable, net 6,778,112
Total Assets $10,972,462 $5,755,124 $4,587,132 $9,832,615
LIABILITIES
Liabilities:
Accounts payable $461,325 $32,172 $29,379 $260,798
Accrued liabilities 9,905
Due to other funds 478,321 149,069 688,043
Due to other governments 474,442 12,000
Bond Anticipation Notes payable 780,000
Compensated absences 119,922
Unearned revenue 209,488
Other liabilities 486,169 34,895 92
Total Liabilities 2,229,667 216,136 729,514 1,050,703
DEFERRED INFLOWS OF RESOURCES
Unavailable revenue 923,527 6,778,112
FUND BALANCES
Fund Balances:
Nonspendable 1,272,736 575,993 208,249
Restricted 487,581 3,803,578 2,449,197 2,003,800
Assigned 2,767,667 1,159,417 1,200,172
Unassigned 3,291,284
Total Fund Balances (Deficit)7,819,268 5,538,988 3,857,618 2,003,800
Total Liabilities, Deferred Inflows of
Resources and Fund Balances $10,972,462 $5,755,124 $4,587,132 $9,832,615
See Independent Auditor's Report and Notes to Financial Statements
CITY OF ITHACA
BALANCE SHEET
GOVERNMENTAL FUNDS
DECEMBER 31, 2014
Major Funds
- 6 -
Special Revenue Funds
Major Funds Total
Capital Non-Major Total
Projects Governmental Governmental
Funds Funds
$40,068,228 $228,077 $46,017,532
1,802,647
927,452
861,060 3,512,387 4,912,834
5,603,382 6,540,145
1,055,684
420,761 3,005,688
778,036
13,522 1,292,464
612,296 9,356,452
6,778,112
$46,532,670 $4,787,043 $82,467,046
$3,354,693 $473,904 $4,612,271
9,905
3,524,159 73,242 4,912,834
275,673 762,115
49,103,887 49,883,887
119,922
209,488
(447)520,709
55,982,739 822,372 61,031,131
7,701,639
62,800 2,119,778
3,635,635 12,379,791
626,086 5,753,342
(9,450,069) (359,850) (6,518,635)
(9,450,069) 3,964,671 13,734,276
$46,532,670 $4,787,043 $82,467,046
- 6a -
Fund
Total Governmental Fund Balances $13,734,276
Capital assets $268,804,694
Accumulated depreciation (118,938,147) 149,866,547
12,940,645
7,701,639
Accrued interest payable $(1,267,383)
Premium on BANs (391,406)
Deferred charge on refunding 919,596
Other postemployment benefits payable (102,545,205)
Compensated absences (2,456,029)(105,740,427)
(61,044,557)
(2,689,771)
Net Position of Governmental Activities $14,768,352
See Independent Auditor's Report and Notes to Financial Statements
Bonds payable are notdue andpayable in the current period and,therefore,are not
reported in the funds.
- 7 -
Lease obligations payable are notdue andpayable in the current period and,
therefore, are not reported in the funds.
Amounts reported for Governmental Activities in the Statement of Net Position are
different because:
Capital assets,net of accumulated depreciation,used in Governmental Activities are
not financial resources and, therefore, are not reported in the funds.
Other long-term assets are not available to pay for current period expenditures and,
therefore, are deferred in the funds.
CITY OF ITHACA
RECONCILIATION OF GOVERNMENTAL FUNDS BALANCE SHEET
TO THE STATEMENT OF POSITION
DECEMBER 31, 2014
Certain accrued expenses reported in the Statement of Net Position donot require the
use of current financial resources and,therefore,are not reported as liabilities or
deferred outflows in Governmental Funds.
Equity interests in joint ventures are not reported in the fund financial statements
because they donot represent current resources.These are the investments in the
City's joint ventures.
General Water Sewer Special Grant
Fund Fund Fund Fund
REVENUES
Real property taxes $20,515,747 $$$
Real property tax items 797,917
Nonproperty tax items 13,880,274
Departmental income 4,081,541 4,344,618 5,811,904
Intergovernmental charges 3,884,948 173 16,345
Use of money and property 304,793 5,297 3,915 2,456
Licenses and permits 951,807
Fines and forfeitures 1,086,057
Sale of property and compensation for loss 497,456 9,228 3,679
Miscellaneous local sources 1,305,433 935,378
Interfund revenues 282,294
State sources 3,446,149 10,000
Federal sources 371,022 938,694
Total Revenues 51,405,438 4,369,316 5,835,843 1,876,528
EXPENDITURES
Current:
General governmental support 5,412,959 165,133 205,881
Public safety 13,410,005
Transportation 5,276,969
Economic assistance and opportunity 61,000
Culture and recreation 5,415,224
Home and community services 1,707,358 2,117,517 2,959,773 1,669,194
Employee benefits 15,254,314 906,224 1,317,920
Debt Service:
Principal 4,087,741 394,353 584,041
Interest 2,377,391 379,184 353,106
Capital outlay
Total Expenditures 53,002,961 3,962,411 5,420,721 1,669,194
Excess of (Expenditures) Revenues (1,597,523) 406,905 415,122 207,334
OTHER FINANCING SOURCES (USES)
Interfund transfers in 1,179,643 12,500 26,500
Interfund transfers (out)(11,000) (306,000) (360,000)
Premiums on obligations
BANs redeemed from appropriations 30,000
Proceeds of obligations
Payments to escrow agent
Total Other Financing Sources (Uses)1,168,643 (293,500) (333,500) 30,000
Net Changes in Fund Balances (428,880) 113,405 81,622 237,334
Fund Balances, Beginning 8,248,148 5,425,583 3,775,996 1,766,466
Fund Balances, Ending $7,819,268 $5,538,988 $3,857,618 $2,003,800
See Independent Auditor's Report and Notes to Financial Statements
CITY OF ITHACA
GOVERNMENTAL FUNDS
FOR THE YEAR ENDED DECEMBER 31, 2014
STATEMENT OF REVENUES, EXPENDITURES, AND CHANGES IN FUND BALANCES
Major Funds
- 8 -
Special Revenue Funds
Major Funds Total
Capital Non-Major Total
Projects Governmental Governmental
Funds Funds
$$$20,515,747
797,917
860,651 14,740,925
501,489 14,739,552
3,901,466
1,103 317,564
951,807
1,086,057
510,363
401,130 2,641,941
282,294
806,497 4,262,646
5,487,418 6,797,134
6,695,045 1,363,243 71,545,413
95,885 5,879,858
13,410,005
321,846 5,598,815
61,000
5,415,224
2,037 419,665 8,875,544
214,708 17,693,166
8,455 5,074,590
241,193 3,350,874
15,699,705 15,699,705
15,701,742 1,301,752 81,058,781
(9,006,697) 61,491 (9,513,368)
11,000 1,229,643
(552,643)(1,229,643)
1,524,988 1,524,988
247,338 277,338
9,945,000 9,945,000
(10,982,698)(10,982,698)
(294,305) 487,290 764,628
(9,301,002) 548,781 (8,748,740)
(149,067) 3,415,890 22,483,016
$(9,450,069) $3,964,671 $13,734,276
Fund
- 8a -
Net Change in Fund Balances - Total Governmental Funds $(8,748,740)
$18,807,554
(7,956,254)
(20,206) 10,831,094
1,170,930
(1,441,892)
$(9,945,000)
10,982,698
(277,338)
(1,524,988)
5,074,590 4,309,962
$(584,426)
(91,884)
(15,519,743)
on refunding of serial bonds 34,100
237,669 (15,924,284)
Change in Net Position of Governmental Activities $(9,802,930)
See Independent Auditor's Report and Notes to Financial Statements
Amortization of premium and deferred amounts
Premium on debt issued
BANs redeemed from appropriations
Principal payments
Some expenses reported in the Statement of Activities do not require the use of current
financial resources and, therefore, are not reported as expenditures in Governmental Funds.
Change in compensated absences
Change in accrued interest payable
Change in other postemployment benefits payable
- 9 -
Governmental Funds report capital outlay as expenditures.However,in the Statement of
Activities,the costof those assets is allocated over their estimated useful lives as depreciation
expense.This is the amount by which capital outlay exceeded depreciation expense in the
current period.In the Statement of Activities,only the gain or loss on the sale of capital assets
is reported,whereas,in the Governmental Funds,the proceeds from the sale of capital assets
increase financial resources.Thenet effect is a loss on sale of capital assets on the Government-
wide Statement of Activities vs.proceeds from the sale of capital assets on the Governmental
Fund financial statements.
Capital outlay
Net book value of disposed assets
Revenues in the Statement of Activities that do not provide current financial resources are not
reported as revenues in the funds.
Equity interests in joint ventures are not reported in the fund financial statements because they
donot represent current resources.This is the change in the investments in the City's joint
ventures.
Bond proceeds provide current financial resources to Governmental Funds,but issuing debt
increases long-term liabilities in the Statement of Net Position.Repayment of debt principal is
an expenditure in the Governmental Funds,but the repayment reduces long-term liabilities in
the Statement of Net Position.This is the amount by which the issuance of new debt and BANs
redeemed exceeded repayment of debt principal.
Depreciation expense
Amortization of premium on Bond Anticipation Notes
Payments to escrow agent
CITY OF ITHACA
RECONCILIATION OF GOVERNMENTAL FUNDS STATEMENT OF REVENUES
EXPENDITURES, AND CHANGES IN FUND BALANCES
TO THE STATEMENT OF ACTIVITIES
FOR THE YEAR ENDED DECEMBER 31, 2014
Proceeds of debt
Amounts reported for Governmental Activities in the Statement of Activities are different because:
Agency
Fund
ASSETS
Cash and cash equivalents - Unrestricted $892,998
Total Assets $892,998
LIABILITIES
Agency liabilities $892,998
Total Liabilities $892,998
See Independent Auditor's Report and Notes to Financial Statements
- 10 -
CITY OF ITHACA
STATEMENT OF FIDUCIARY NET POSITION
FIDUCIARY FUND
DECEMBER 31, 2014
CITY OF ITHACA
NOTES TO FINANCIAL STATEMENTS
FOR THE YEAR ENDED DECEMBER 31, 2014
-11 -
Note 1 Summary of Significant Accounting Policies
The financial statements of the City of Ithaca (the City)have been prepared in conformity with
accounting principles generally accepted in the United States of America (GAAP) as applied to
government units. The City’s reporting entity applies all relevant Governmental Accounting
Standards Board (GASB) pronouncements. The GASB is the accepted standard setting body
for establishing governmental accounting and financial reporting principles.
A.Financial Reporting Entity
The City,which was established in 1888,is governed by its Charter, General City Law and
other general laws of the State of New York and various local laws. The Common Council
is the legislative body responsible for overall operations; the Mayor serves as chief
executive officer, and the Controller serves as the chief fiscal officer.
The following basic services are provided: public safety (police and fire), highways and
streets, sanitation, health, culture and recreation, public improvements, planning and
zoning, and general administration.
All Governmental Activities and functions performed for the City are its direct
responsibility. No other governmental organizations have been included or excluded from
the reporting entity.
The financial reporting entity consists of the following, as defined by GASB Statement
No.14, “The Financial Reporting Entity,”as amended by GASB Statement No.39,
“Determining Whether Certain Organizations are Component Units”and GASB Statement
No.61, “The Financial Reporting Entity: Omnibus -an Amendment of GASB Statements
Nos.14 and 34.
a.The primary government, which is the City,
b.Organizations for which the primary government is financially accountable, and;
c.Other organizations for which the nature and significance of their relationship with
the primary government are such that exclusion would cause the reporting entity's
financial statements to be misleading or incomplete.
The decision to include a potential component unit in the City's reporting entity is based on
several criteria set forth in GASB Statement No.14, as amended by GASB Statement
Nos.39, and 61 including legal standing, fiscal dependency, and financial accountability.
Based on the application of these criteria, the following has been included in the City's
reporting entity.
CITY OF ITHACA
NOTES TO FINANCIAL STATEMENTS
FOR THE YEAR ENDED DECEMBER 31, 2014
-12 -
Note 1 Summary of Significant Accounting Policies -Continued
1.Blended Component Unit
Based on the foregoing criteria and the significant factors presented below, the Ithaca
Urban Renewal Agency (IURA) is included in the reporting entity and is reflected as
such as blended component unit in the financial statements, reported as a special
revenue fund. The IURA is a public benefit corporation established in 1965 as an urban
renewal agency. The Agency has a corporate identity separate from the City and is
independently funded, but works in close conjunction with the City to revitalize urban
neighborhoods and strengthen the local economy. The Agency is composed of the
Mayor and four members appointed by the Mayor with the concurring approval of the
Common Council. The Director of Planning and Development for the City of Ithaca
serves as the Executive Director of the Agency.
Through a variety of means, including site acquisition and disposition, the Agency
works to implement the Urban Renewal Plan that seeks to stabilize neighborhoods and
enhance the vitality of the downtown and community. Through the City, the Agency
applies for and receives various grants to address community development needs. On
an annual basis, the Agency manages the City’s HUD Entitlement Grant award of
Community Development Block Grant (CDBG) and Home Investment Partnerships
Program (HOME) funds to undertake activities in the areas of housing, community
facilities, public services, and economic development that benefit Ithaca’s low and
moderate-income neighborhoods and households, or eliminate blighting conditions.In
addition, the Agency administers various economic development loan programs, the
Cherry Street Industrial Park, and leases to facilitate private/public real estate projects.
Separate financial statements for the IURA can be obtained by contacting the IURA at
108 East Green Street, Ithaca. NY 14850.
2.Joint Ventures
a.Ithaca Area Waste Water Treatment Facility
In 1981 the City, Town of Ithaca and Town of Dryden executed an agreement
whereby the parties agreed to jointly own and operate a sewage treatment plant and
related facilities. Board members of each municipality jointly act as the governing
body for the joint venture. The Facility is intended to be self-sustaining. However,
any shortfall is to be provided by equal share contributions from the participants.
See Note 4for additional disclosure regarding this joint venture.
CITY OF ITHACA
NOTES TO FINANCIAL STATEMENTS
FOR THE YEAR ENDED DECEMBER 31, 2014
-13 -
Note 1 Summary of Significant Accounting Policies -Continued
b.Tompkins Consolidated Area Transit (TCAT)
Tompkins Consolidated Area Transit (TCAT) was formed under a consolidation
agreement between the City, Tompkins County, and Cornell University effective
April 1, 1998. The agreement shall remain in force until October 9, 2021. TCAT
began operations on January 1, 1999, with its purpose to provide public
transportation in Tompkins County and surrounding areas. As of January 1, 2005,
TCAT was reorganized as a 501(c)(3). However, the structure of the Board, and the
interest of each party was not changed. TCAT is governed by a Board of Directors
consisting of nine voting members with three members being appointed by each
participant in the venture. The General Manager of TCAT is a non-voting ex-
officio member of the Board. In addition, the nine voting members of the Board
select five additional non-voting, ex-officio members. Interest of each part y in
surpluses, losses, property, and in debt acquired by TCAT shall be shared equall y.
Each part y makes an annual contribution of equal amounts to the venture. See Note
4 for additional disclosure regarding this joint venture.
3.Related Organizations
Although the following organizations, functions, or activities are related to the City, they
are not included in the City's reporting entity because the City does not meet the criteria
for manifestation of oversight as defined by the GASB.
a.Ithaca Housing Authority
The Ithaca Housing Authority (Authority)was created pursuant to Section 447 of
the Public Housing Law. Its general purpose is to provide housing for low-income
residents of the City. Members of the Board are appointed by the Mayor. Specific
reasons for excluding the Authority from the City's reporting entity are as follows:
The Authorit y's Board of Commissioners control employment of personnel; the City
cannot significantly influence the Authorit y's operations; the City has no budgetary
authority; the Authority controls surpluses and deficits; the City has no
responsibility for the Authority's debt; and the Authority's Board of Commissioners
controls fiscal management.
b.Ithaca City School District
Essentially, the primary function of the Ithaca City School District (School District) is
to provide education for pupils. Services such as transportation of pupils,
administration, finance, and plant maintenance support the primary function. Specific
reasons for excluding the School District from the City's reporting entity are as
follows: The City cannot significantly influence the School District's operations; the
City has no budgetary authority; the School District controls surpluses and deficits;
the City has no responsibility for the School District's debt; and the School District's
Board of Education controls fiscal management.
CITY OF ITHACA
NOTES TO FINANCIAL STATEMENTS
FOR THE YEAR ENDED DECEMBER 31, 2014
-14-
Note 1 Summary of Significant Accounting Policies -Continued
B.BasicFinancial Statements
The City's basic financial statements include both Government-wide (reporting the City as a
whole) and Governmental Fund financial statements (reporting the City's Major Funds.)
Both the Government-wide and Governmental Fund financial statements categorize
primary activities as either governmental or business-type. The City's general governmental
support, education, public safety, health, transportation, highways and streets, economic
assistance and opportunity, culture and recreation, and home and community services are
classified as Governmental Activities.
1.Government-wide Financial Statements
The Government-wide financial statements include a Statement of Net Position and a
Statement of Activities. These statements present summaries of activities for the
primary government. Government-wide financial statements do not include the
activities reported in the Fiduciary Funds. This Government-wide focus is more on the
sustainability of the City as an entit y and the change in the City's net position resulting
from the current year's activities.
In the Government-wide Statement of Net Position, the Governmental Activities
columns are reported on a full accrual, economic resource basis, which recognizes all
long-term assets and receivables as well as long-term debt and obligations. The City's
net position is reported in three parts -net investment in capital assets,restricted and
unrestricted.
The Statement of Activities reports both the gross and net cost for each of the City's
functions or programs. Gross expenses are direct expenses, including depreciation, that
are specifically associated with a service, program or department and, therefore,are
clearly identifiable to a particular function. These expenses are offset by program
revenues -charges paid by the recipient of the goods or services offered by the program,
grants, and contributions -that are restricted to meeting the program or capital
requirements of a particular program. Revenues, which are not classified as program
revenues, are presented as general revenues of the City, with certain limited exceptions.
The net cost represents the extent to which each function or program is self-financing or
draws from the general revenues of the City.
The City does not allocate indirect costs. Indirect costs are reported in the function
entitled “general government.”
CITY OF ITHACA
NOTES TO FINANCIAL STATEMENTS
FOR THE YEAR ENDED DECEMBER 31, 2014
-15-
Note 1 Summary of Significant Accounting Policies -Continued
2.Governmental Fund Financial Statements
The financial transactions of the City are reported in individual funds in the
Governmental Fund financial statements. Each fund is accounted for by providing a
separate set of self-balancing accounts that comprises its assets, liabilities, reserves,
fund equity, revenues and expenditures or expenses. Fund accounting is designed to
demonstrate legal compliance and to aid financial management by segregating
transactions related to certain government functions or activities.
The City records its transactions in the funds described below:
a.Governmental Funds
Governmental Funds are those through which most governmental functions are
financed. The acquisition, use, and balances of expendable financial resources, and
the related liabilities are accounted for through Governmental Funds. The
measurement focus of the Governmental Funds is based upon determination of
financial position and changes in financial position.
The following are the City’s Governmental Funds:
1)Major Funds
General Fund -Principal operating fund; includes all operations not required to
be recorded in other funds.
Capital Projects Fund -Accounts for financial resources to be used for the
acquisition, construction, or renovation of major capital facilities, or equipment.
a)Special Revenue Funds
Water Fund -Accounts for revenues derived from charges for water
consumption and the application of such revenues toward related operating
expenses and debt retirement.
Sewer Fund -Accounts for revenues derived from charges for sewer usage
and benefited assessments, and the application of such revenues toward
related operating expenses and debt retirement.
Special Grant Fund -Accounts for Community Development Block Grant
activities.
CITY OF ITHACA
NOTES TO FINANCIAL STATEMENTS
FOR THE YEAR ENDED DECEMBER 31, 2014
-16-
Note 1 Summary of Significant Accounting Policies -Continued
2)Non-Major Funds
a)Special Revenue Funds
Refuse and Garbage Fund -Accounts for revenues derived from charges for
garbage,refuse, and recycling consumption, and the application of such
revenues toward related operating expenses.
Sidewalk Im provement District Fund -accounts for revenues derived from
propert y assessments for sidewalk improvement.
Urban Renewal Agency Fund -Accounts for money advanced for the Center
Ithaca Project.
Miscellaneous Fund -Accounts for assets held in the capacity of a trustee for
assets to benefit the City’s parks program.
b)Debt Service Fund -Accounts for current payments of principal and interest
on general obligation debt and for financial resources accumulated in a
reserve for payment of future principal and interest on long-term
indebtedness.
c)Permanent Fund -Reports all trust arrangements under which principal and
income benefit individuals, private organizations, or other governments. The
City uses this fund to report funds provided for cemetery maintenance.
3)Fiduciary Fund Types
Fiduciary Fund Types are used to account for assets held by the local government
in a trustee or custodial capacity. The following is the City’s Fiduciary Fund:
Agency Fund -Accounts for money and/or property received and held in the
capacit y of trustee,custodian or agent.
C.Basis of Accounting/Measurement Focus
Basis of accounting refers to when revenues and expenditures and the related assets and
liabilities are recognized in the accounts and reported in the financial statements. Basis of
accounting relates to the timing of the measurements made, regardless of the measurement
focus. Measurement focus is the determination of what is measured, i.e. expenditures or
expenses.
CITY OF ITHACA
NOTES TO FINANCIAL STATEMENTS
FOR THE YEAR ENDED DECEMBER 31, 2014
-17-
Note 1 Summary of Significant Accounting Policies -Continued
1.Accrual Basis -The Government-wide financial statements and Fiduciary Fund
financial statements are presented on an “economic resources”measurement focus and
the accrual basis of accounting. Accordingl y,all of the City’s assets, deferred outflows,
liabilities, and deferred inflows, including capital assets, as well as infrastructure assets
and long-term liabilities, are included in the accompanying Statement of Net Position.
The Statement of Activities presents changes in net position. Under the accrual basis of
accounting, revenues are recognized when earned and expenses are recognized when
incurred.
2.Modified Accrual Basis -Under this basis of accounting, revenues are recorded when
measurable and available. Available means collectible within the current period or soon
enough thereafter to be used to pay liabilities of the current period. Material revenues
that are accrued include real property taxes, state and federal aid, sales tax, and certain
user charges. The City considers property tax receivables collected within 60 days after
year end to be available and recognizes them as revenues of the current year. All other
revenues deemed collectible within one year after year end are recognized as revenues
in the current year. If expenditures are the prime factor for determining eligibility,
revenues from federal and state grants are accrued when the expenditure is made.
Expenditures are recorded when incurred. The cost of capital assets is recognized as an
expenditure when received. Exceptions to this general rule are that 1) principal and
interest on indebtedness are not recognized as an expenditure until due, and 2)
compensated absences, such as vacation and sick leave, which vests or accumulates, are
charged as an expenditure when paid.
D.Unearned Revenues
The City reports unearned revenues on its Statement of Net Position and its Balance Sheet.
On the Statement of Net Position, unearned revenue arises when resources are received by
the City before it has legal claim to them, as when grant monies are received prior to
incurrence of qualifying expenditures. In subsequent periods, when the City has legal claim
to resources, the liability for unearned revenue is removed and revenue is recognized.
E.Deferred Outflows and Inflows of Resources
In addition to assets, the Statement of Net Position will sometimes report a separate section
for deferred outflows of resources. This separate financial statement element, deferred
outflows of resources, represents a consumption of net position that applies to a future
period and so will not be recognized as an outflow of resources (expense/expenditure) until
then. The government has one item that qualifies for reporting in this category. It is the
deferred charge on refunding reported in the government-wide Statement of Net Position.
A deferred charge on refunding results from the difference in the carrying value of refunded
debt and its reacquisition price. This amount is deferred and amortized over the shorter of
the life of the refunded or refunding debt.
CITY OF ITHACA
NOTES TO FINANCIAL STATEMENTS
FOR THE YEAR ENDED DECEMBER 31, 2014
-18-
Note 1 Summary of Significant Accounting Policies -Continued
In addition to liabilities, the Statement of Net Position and the Balance Sheet will
sometimes report a separate section for deferred inflows of resources. This separate
financial statement element, deferred inflows of resources, represents an acquisition of net
position that applies to a future period(s) and so will not be recognized as an inflow of
resources (revenue) until that time. The government has only one type of deferred inflow,
which arises only under a modified accrual basis of accounting that qualifies for reporting
in this category. Accordingly, the item, unavailable revenue, is reported only in the
governmental fund Balance Sheet. The governmental fund reports unavailable revenues
from loans receivable. These amounts are deferred and recognized as an inflow of
resources in the period that the amounts become available.
F.Inventory
Inventory is valued at cost utilizing the first-in, first-out method for the General, Water, and
Sewer Funds.
G.Property Taxes
Real property taxes are levied annually by the City no later than December 31, and become a
lien on January 1. City taxes are collected in two installments, the first due in January and the
second due in June. The City collects county taxes from January 1, through May 31.
Collected County taxes are remitted to the County on a monthly basis.
Unpaid County taxes are enforced pursuant to Article II of Real Property Tax Law. The
County retains all right, title, and interest in any unpaid County taxes. Unpaid City taxes and
unpaid school taxes plus advertising costs and accrued penalties are foreclosed two years after
lien date pursuant to Article II of Real Property Tax Law. Should both the County and the
City have liens on a particular property, either may foreclose. The foreclosure is subject to
the other’s lien. The City and the County, based on the tax liens each hold, share proceeds
from the sale of the property.
H.Receivables
Property tax receivables are stated net of estimated allowances for uncollectible amounts.
Amounts due from state and federal governments represent amounts owed to the City to
reimburse it for expenditures incurred pursuant to state and federally funded programs.
Other receivables represent amounts owed to the City including sewer rents, water rents,
rehabilitation loans, and assessments. No provision has been made for uncollectible
accounts reported as other receivables, as it is believed that such amounts would be
immaterial. All receivables net of estimated allowances for uncollectible amounts are
expected to be collected within the subsequent fiscal year.
CITY OF ITHACA
NOTES TO FINANCIAL STATEMENTS
FOR THE YEAR ENDED DECEMBER 31, 2014
-19-
Note 1 Summary of Significant Accounting Policies -Continued
I.Cash and Cash Equivalents
For financial statement purposes, all highly liquid investments with initial maturities of
three months or less are considered cash equivalents.
J.Capital Assets
All capital assets are valued at historical cost or estimated historical cost. Contributed
assets are reported at fair market value as of the date received. Additions, improvements,
and other capital outlays that significantl y extend the useful life of an asset are capitalized.
Other costs incurred for repairs and maintenance are expensed as incurred. Depreciation
on all assets is provided on the straight-line basis over the estimated useful lives of the
assets. Governmental capital assets purchased or acquired with an original cost of over
$5,000 for buildings and infrastructure assets and $2,500 for machinery and equipment, and
having a useful life of greater than one year are capitalized. The estimated useful lives for
governmental capital assets are as follows:
Buildings and improvements 10 -45 years
Machinery and equipment 5-25 years
Infrastructure 10 -60 years
No interest on construction in progress has been capitalized.
K.Insurance
The City assumes the liability for most risk including, but not limited to, property damage
and personal injury liability. Judgments and claims are recorded when it is probable that an
asset has been impaired or a liability has been incurred and the amount of loss can be
reasonably estimated.
L.Vacation and Sick Leave and Compensatory Absences
City employees are granted vacation, sick leave, and other leave benefits as defined in
agreements between the City and the representative units.
The City recognizes a liability for vacation leave and other compensated absences with
similar characteristics and additional salary-related payments as the benefits are earned by the
employees, based on the rendering of past service and the probability the employees will be
compensated for the benefits through paid time off or some other means. This includes
vacation leave and other compensated absences with similar characteristics earned but not
used during the current or prior periods and for which employees can receive compensation in
a future period. Amounts do not include leave expected to lapse and do include leave that
(new) employees will (eventually) qualify for.
CITY OF ITHACA
NOTES TO FINANCIAL STATEMENTS
FOR THE YEAR ENDED DECEMBER 31, 2014
-20 -
Note 1 Summary of Significant Accounting Policies -Continued
In addition, the City recognizes a liability for vesting sick leave and other compensated
absences with similar characteristics and additional salary-related payments as employees
earn benefits and to the extent it's probable that the City will compensate the employees for
the benefits through cash payments (which may be conditioned on the employees' termination
or retirement), rather than be taken as absences due to illness or other contingencies.
A portion of the compensated absence liability recognized is attributable to the value of sick
leave converted into payment for employees' share of postemployment health care insurance
premiums.
The liability for compensated absences is calculated at rates in effect as of the balance sheet
date and is recorded in the Governmental Funds inasmuch as it will be funded from current
financial resources. The Statement of Net Position records this current portion, as well as
amounts to be paid from future financial resources.
M.Other Postretirement Benefits
In addition to providing pension benefits, the City provides health insurance coverage and
survivor benefits for retired employees and their survivors in accordance with employment
contracts. Substantially all of the City's employees may become eligible for these benefits if
they reach normal retirement age while working for the City. Health care benefits and
survivors benefits are provided through an insurance company whose premiums are based on
the benefits paid during the ye ar. The City recognizes the cost of providing benefits by
recording its share of insurance premiums as an expenditure in the year paid. The actual
contribution (versus expected contribution)paid on behalf of 241 retirees for the year was
$4,389,379 and recorded as an expenditure in the General Fund. For additional information,
see Note 3.B.4.
N.Use of Estimates
Management uses estimates and assumptions in preparing financial statements. Those
estimates and assumptions affect the reported amounts of assets and liabilities, the
disclosure of contingent assets and liabilities, and the reported revenues and expenses.
Actual results could differ from those estimates.
O.Restricted Resources
When an expense is incurred for purposes for which both restricted and unrestricted
resources are available, it is the City’s policy to apply restricted funds before unrestricted
funds, unless otherwise prohibited by legal requirements.
CITY OF ITHACA
NOTES TO FINANCIAL STATEMENTS
FOR THE YEAR ENDED DECEMBER 31, 2014
-21 -
Note 1 Summary of Significant Accounting Policies -Continued
Certain assets are classified on the Balance Sheet as restricted because their use is limited.
The proceeds of bond and note sales can only be used for the stated purpose of the
borrowing. Property taxes collected for debt service payments are legally restricted for that
purpose. Community Development Block Grant Funds must be used only for approved
programs. Cemetery perpetual care funds cannot be expended. However, the interest
earnings can be spent for cemetery maintenance functions. It is the City’s policy to spend
the interest earnings each fiscal year.
P.Equity Classifications
1.Government-wide Financial Statements
Equity is classified as net position and displayed in three components:
Net investment in capital assets -Consists of capital assets including
restricted capital assets, net of accumulated depreciation and reduced by the
outstanding balances of any bonds, mortgages, notes or other borrowings
attributable to the acquisition, construction, or improvement of those assets.
Restricted -Consists of resources with constraints placed on the use either
by 1) external groups such as creditors, grantors, contributors, or laws or
regulations of other governments; or 2) law through constitutional
provisions or enabling legislation.
Unrestricted -Consists of all other resources that do not meet the definition
of “restricted”or “net investment in capital assets.”
2.Governmental Fund Financial Statements
Governmental Fund equity is classified as fund balance. Proprietary Fund equity is
classified the same as in the Government-wide financial statements. Any capital gains
or interest earned on reserve fund resources becomes part of the respective reserve fund.
While a separate bank account is not necessary for each reserve fund, a separate identity
for each reserve fund must be maintained.
CITY OF ITHACA
NOTES TO FINANCIAL STATEMENTS
FOR THE YEAR ENDED DECEMBER 31, 2014
-22-
Note 1 Summary of Significant Accounting Policies -Continued
Constraints are broken into five classifications: nonspendable, restricted, committed,
assigned, and unassigned. These classifications serve to inform readers of the financial
statements of the extent to which the government is bound to honor any constraints on
specific purposes for which resources in a fund can be spent.
Nonspendable
Consists of assets inherently nonspendable in the current period either
because of their form or because they must be maintained intact; including
prepaid items, inventories, long-term portions of loans receivable, financial
assets held for resale, and endowments principal.
Restricted
Consists of amounts subject to legal purpose restrictions imposed by
creditors, grantors, contributors, or laws and regulations of other governments
and enforced externally; or through constitutional provisions or enabling
legislation. Most of the City’s legally adopted reserves are reported here.
Committed
Consists of amounts subject to a purpose constraint imposed by formal
action of the government’s highest level of decision-making authority prior to
the end of the fiscal year, which requires the same level of formal action to
remove said constraint.
Assigned
Consists of amounts subject to a purpose constraint representing an intended
use established by the government’s highest level of decision-making authority,
or their designated body or official. The purpose of the assignment must be
narrower than the purpose of the General Fund. In funds other than the General
Fund, assigned fund balance represents the residual amount of fund balance.
Unassigned
Represents the residual classification of the government’s General Fund, and
could report a surplus or deficit. In funds other than the General Fund, the
unassigned classification should only be used to report a deficit balance
resulting from overspending amounts restricted, committed, or assigned for
specific purposes.
CITY OF ITHACA
NOTES TO FINANCIAL STATEMENTS
FOR THE YEAR ENDED DECEMBER 31, 2014
-23 -
Note 1 Summary of Significant Accounting Policies -Continued
The City has not adopted any resolutions to commit fund balance. Currently, fund
balance is assigned by the City Controller for encumbrances and designations and the
Common Council, by resolution, approves fund balance appropriations for next year’s
budget. The City has not formally adopted a policy defining the order in which to apply
expenditures against fund balances. However, the City’s policy is to apply expenditures
against non-spendable fund balance, restricted fund balance, committed fund balance,
assigned fund balance, and unassigned fund balance.
Q.Interfund Activity
Interfund activity is reported as either loans, services provided, reimbursements or
transfers. Loans are reported as interfund receivables and payables as appropriate,and are
subject to elimination upon consolidation. Services provided, deemed to be at market or
near market rates, are treated as revenues and expenditures/expenses. Reimbursements are
when one fund incurs a cost, charges the appropriate benefiting fund and reduces its related
cost as a reimbursement. All other interfund transactions are treated as transfers.
Note 2 Stewardship, Compliance, Accountability
A.Deficit Fund Balances
The Refuse and Garbage Fund had a deficit fund balance of $(348,686)due to the current
and previous years’ excess of expenditures over revenue. The City continues to review the
trash tag fee structure, yard waste expense and route changes to find increasing revenue
sources and cost efficiencies to balance the Solid Waste Fund. The General Fund will
continue to provide funds necessary to balance the budget in the future. The current deficit
reflects an increase of $109,068.
The Capital Fund had a deficit fund balance of $(9,450,069)due to the issuance of short
term debt to fund capital improvements. This deficit will be eliminated when short-term
debt is converted to long-term debt.
Note 3 Detailed Notes
A.Assets
1.Cash and Investments
The City's investment policies are governed by state statutes. In addition, the City has
its own written investment policy. City monies must be deposited in Federal Deposit
Insurance Corporation (FDIC) insured commercial banks or trust companies located
within the state. The Controller is authorized to use demand accounts and certificates of
deposit. Permissible investments include obligations of the U.S. Treasury and U.S.
Agencies, repurchase agreements, and obligations of New York State or its localities.
CITY OF ITHACA
NOTES TO FINANCIAL STATEMENTS
FOR THE YEAR ENDED DECEMBER 31, 2014
-24-
Note 3 Detailed Notes -Continued
Collateral is required for demand and time deposits and certificates of deposit not
covered by federal deposit insurance. Obligations that may be pledged as collateral are
obligations of the United States and its agencies and obligations of the state and its
municipalities and school districts.
The written investment policy requires repurchase agreements to be purchased from
banks located within the state and that underlying securities must be obligations of the
federal government. Underlying securities must have a market value of at least the cost
of the repurchase agreement.
Deposits and investments are valued at cost or cost plus interest.Total financial
institution (bank) balances at December 31, 2014, per the banks, were $61,731,839,
which were insured,and collateral, where required, was held by the City's agent in the
City's name.
Cash restricted for General, Water, and Sewer Fund reserves are $487,581,$3,803,578,
and $2,449,197,respectively.Other restricted cash consists of$2,003,800 in the
Special Grant Fund for community development projects, $49,278 in the Permanent
Fund, $560,018in the Debt Service Fund, and $3,000 in the Miscellaneous Fund.
Investments consisted of a one year certificate of deposit with a cost and fair value of
$1,802,647at December 31, 2014.
2.Other Receivables
Other receivables at December31, 2014 are as follows:
Major Funds:
General Fund:
Accounts receivable $ 399,645
Total General Fund 399,645
Special Revenue Funds:
Water Fund:
Water rents receivable 736,210
Accounts receivable 221,173
Total Water Fund 957,383
Sewer Fund:
Sewer rents receivable 1,129,296
Accounts receivable -Special assessments 91,244
Total Sewer Fund 1,220,540
CITY OF ITHACA
NOTES TO FINANCIAL STATEMENTS
FOR THE YEAR ENDED DECEMBER 31, 2014
-25-
Note 3 Detailed Notes -Continued
Special Grant Fund:
Accounts receivable -Reimbursements 7,359
Non-Major Funds:
Special Revenue Funds:
Urban Renewal Agency Fund -Due from developer398,079
Refuse and Garbage Fund -Fees 22,682
Total Other Receivables -Government Activities $3,005,688
3.Property Taxes
At December 31, 2014, the total real property tax assets of $927,452 are offset by
deferred tax revenue of $923,527 in the General Fund. In the Statement of Net
Position,these assets are not deferred.
4.Sales Taxes and Collection
The City, under the general authority of Article 29 of the Tax Law, imposes a 0.5%sales
and compensating use tax. The County of Tompkins, by similar authority, also imposes a
0.5%sales tax within the City and a 3% sales tax in the towns outside the City.
Both the City and County imposed tax are administered and collected by the State Tax
Commission in the same manner as that relating to the State imposed 4%(June 1, 2005)
sales and compensating use tax.
Net collections, meaning monies collected after deducting expenses of administration and
collections and amounts refunded or to be refunded, but inclusive of any applicable
penalties and interest, are paid by the State to the City and the County, respectively. In
2014, direct payments from this source aggregated $13,432,961,were credited to the
General Fund and used to finance general City expenses.
Net collections of the 1.5% sales tax imposed within the City by the Count y are retained
by the County, and, together with 0.5%of the tax levied in the towns outside of the City,
or 2.0%, is applied to the reduction of taxes levied on a Countywide basis.
The County of Tompkins increased the sales tax collected within the County to 8%. The
City, under the 1% increased sales tax, imposes 0.25% of the 1% increase.
CITY OF ITHACA
NOTES TO FINANCIAL STATEMENTS
FOR THE YEAR ENDED DECEMBER 31, 2014
-26-
Note 3 Detailed Notes -Continued
5.Property and Equipment
A summary of changes in capital assets at December 31, 2014follows:
Balance at
12/31/13 Additions Deletions
Balance at
12/31/14
Governmental Activities
Non-depreciable Capital Assets:
Land $ 13,719,491$ 19,700$$ 13,739,191
Construction in progress 8,524,321 4,794,842 13,319,163
Total Non-depreciable
Capital Assets 22,243,812 4,814,542 -0- 27,058,354
Depreciable Capital Assets:
Buildings and improvements 63,872,883 1,114,725 64,987,608
Machinery and equipment 22,044,127 527,149 (528,604) 22,042,672
In frastructure 142,364,922 12,351,138 154,716,060
Total Depreciable Capital Assets 228,281,932 13,993,012 (528,604) 241,746,340
Total Historical Cost 250,525,744 18,807,554 (528,604) 268,804,694
Less Accumulated Depreciation:
Buildings and improvements (36,702,797)(2,565,091)(39,267,888)
Machinery and equipment (14,092,945)(1,148,812) 508,398 (14,733,359)
In frastructure (60,694,549)(4,242,351)(64,936,900)
Total Accumulated Depreciation (111,490,291)(7,956,254) 508,398 (118,938,147)
Governmental Activities
Capital Assets, Net $ 139,035,453$ 10,851,300$(20,206)$ 149,866,547
Depreciation expense was charged to functions as follows:
Governmental Activities
General governmental support $197,744
Public safety 777,988
Transportation 5,290,991
Culture and recreation 790,251
Home and community services 899,280
Total Governmental Activities Depreciation Expense$7,956,254
CITY OF ITHACA
NOTES TO FINANCIAL STATEMENTS
FOR THE YEAR ENDED DECEMBER 31, 2014
-27-
Note 3 Detailed Notes -Continued
B.Liabilities
1.Pension Plans
Plan Description -The City participates in the New York State and Local Employees'
Retirement System (ERS), the New York State and Local Police and Fire Retirement
System (PFRS), and the Public Employees' Group Life Insurance Plan (Systems).
These are cost-sharing multiple-employer defined benefit public employee retirement
systems. The Systems provide retirement benefits as well as death and disability
benefits. Obligations of employers and employees to contribute and benefits to
employees are governed by the New York State Retirement and Social Security Law
(NYSRSSL). As set forth in the NYSRSSL, the Comptroller of the State of New York
(Comptroller) serves as sole trustee and administrative head of the Systems. The
Comptroller shall adopt and may amend rules and regulations for the administration
and transaction of the business of the Systems and for the custody and control of their
funds. The Systems issue a publicly available financial report that includes financial
statements and required supplementary information. That report may be obtained by
writing to the New York State and Local Retirement Systems, 110 State Street, Albany,
NY 12244.
The City is required to contribute at an actuarially determined rate. The required
contributions for the current year and two preceding years were:
Year ERS PFRS
2014 $2,708,364$2,603,834
2013 2,480,432 2,959,440
2012 2,552,8482,644,002
The City's contributions made to the Systems were equal to 100% of the contributions
required for each year. Included in the ERS contribution is $141,670, $128,101, and
$129,873, attributable to the Ithaca Area Wastewater Treatment Facility for the years
ended 2014, 2013 and 2012, respectively.
The Systems are noncontributory except for employees who joined the New York State
and Local Employees' Retirement System after July 27, 1976 and have fewer than ten
years of credited service. These members contribute 3% of their salary. Those joining
the System on or after January 1, 2010 and before April 1, 2012 are required to contribute
3% of their annual salary for their entire working career. Those joining the System on or
after April 1, 2012 are required to contribute between 3% and 6%, dependent on salary,
for their entire working career. Under the authority of the New York State Retirement
and Social Security Law, the Comptroller shall certify annually the rates expressed as
proportions of payroll of members which shall be used in computing the contributions
required to be made by the employer to the Pension Accumulation Fund.
CITY OF ITHACA
NOTES TO FINANCIAL STATEMENTS
FOR THE YEAR ENDED DECEMBER 31, 2014
-28-
Note 3 Detailed Notes -Continued
The New York State Legislature has authorized local governments to make available
retirement incentive programs. The City participates in early retirement programs when
they are offered and has elected to pay the related cost over a five year amortization
period, which includes interest at rates ranging from 8% to 8.5%. There is no remaining
liability for these incentive programs at December 31, 2014.
2.Short-term Debt
Liabilities for Bond Anticipation Notes are generally accounted for in the Capital Projects
Fund to finance capital projects. Principal payments on BANs must be made annually.
State law requires BANs issued for capital purposes be converted to long-term obligations
within five ye ars after the original issue date. However, BANs issued for assessable
improvement projects may be renewed for periods equivalent to the maximum life of the
permanent financing, provided stipulated annual reductions of principal are made.
a.Summary of Bond Anticipation Notes
As of December 31, 2014,the Bond Anticipation Notes, including issue and maturity
dates and interest rates, consisted of the following:
Date of Final Interest Payable to
Description of Issue Issue Maturity Rate Maturity
Public Improvement 201420151.00%$28,128,725
Public Improvement 20142015.75%20,645,162
Public Improvement 201420152.15%330,000
IURA 201420151.70%780,000
Subtotal Bond Anticipation Notes 49,883,887
Add unamortized premium 391,405
Total Bond Anticipation Notes $50,275,293
IAWWTP
Waste Water Improvement 201420151.00%$3,044,300
Waste Water Improvement 20142015.75%5,003,873
Total IAWWTP Bond
Anticipation Notes $8,048,173
CITY OF ITHACA
NOTES TO FINANCIAL STATEMENTS
FOR THE YEAR ENDED DECEMBER 31, 2014
-29-
Note 3 Detailed Notes -Continued
b.Housing and Urban Development Debt -BAN
The Ithaca Urban Renewal Agency renewed a Neighborhood Housing Initiative
Program BAN in the amount of $780,000 on April 18, 2014 at an interest rate of
1.70% per annum, with a maturity date of April 17, 2015.
The BAN is issued to provide funding for the Agency’s Neighborhood Housing
Initiative Program. The liability is recorded in the IURA’s financial statements.The
City has guaranteed the payment of the note’s principal and interest.
The principal and interest payments are reflected in the City’s financial statements.
Under Article XVIII Section 4 of the State Constitution, the City is permitted to
guarantee principal of and interest on the City Urban Renewal Agency’s bonds. The
bonds do not count toward the City’s debt limit.
Revenue Anticipation Notes (RANs) are typically issued to provide working capital.
There were no RANs issued or redeemed during 2014.
Interest on short-term debt for the year ended December 31, 2014 is as follows:
Interest paid $ 381,812
Less: Interest accrued in the prior year (148,710)
Plus: Interest accrued in the current year 257,348
Less: Amortization of BAN premium (237,669)
Total Expense $ 252,781
See Note 3.B.3. for information concerning short-term debt activity for the year
ending December 31, 2014.
3.Long-term Debt
At December 31, 2014, the total outstanding indebtedness of the City, including the
debt of the IAWWTP aggregated $125,873,991.Of this amount, $77,342,741 was
subject to the constitutional debt limit and represented approximately 73% of its debt
limit.
CITY OF ITHACA
NOTES TO FINANCIAL STATEMENTS
FOR THE YEAR ENDED DECEMBER 31, 2014
-30-
Note 3 Detailed Notes -Continued
a.Serial Bonds
The City borrows money in order to acquire land or equipment or construct
buildings and improvements. This enables the cost of these capital assets to be
borne by the present and future taxpayers receiving the benefit of the capital assets.
These long-term liabilities, which are full faith and credit debt of the local
government, are recorded in the Statement of Net Position. The provision to be
made in future budgets for capital indebtedness represents the amount exclusive of
interest, authorized to be collected in future years from taxpayers and others, for the
liquidation of the long-term liabilities.
On June 5, 2012 the City issued $8,530,000 of general obligation bonds, with
interest rates ranging between 2.00% and 4.00%, pursuant to a Refunding Bond
Resolution duly adopted by the Council on October 5, 2011. The City issued the
bonds to advance refund $8,720,000 of the $9,845,000 outstanding balance of the
2001 and 2004 serial bonds with interest rates of 3.25% to 4.50%. The City used
the net proceeds along with other resources to purchase U.S. government securities.
These securities were deposited in an irrevocable trust to provide for all future debt
service on the refunded portion of the bonds. As a result, the $8,720,000 in bonds
is considered defeased and the liability has been removed from the City’s financial
statements. The present value of the total debt service savings to the City was
$497,299 at the date of issuance. The outstanding principal of the defeased bonds
was $6,640,000at December 31, 2014.
On September 3, 2014,the City issued $9,945,000 of general obligation bonds, with
interest rates ranging between 2.00% and 4.00%, pursuant to a Refunding Bond
Resolution duly adopted by the Council on July 2, 2014. The City issued the bonds
to advance refund $10,360,000 of the $12,175,000 outstanding balance of the 2007
serial bonds with interest rates of 4.00% to 4.25%. The City used the net proceeds
along with other resources to purchase U.S. government securities. These securities
were deposited in an irrevocable trust to provide for all future debt service on the
refunded portion of the bonds. As a result, the $10,360,000 in bonds is considered
defeased and the liability has been removed from the City’s financial statements.
The present value of the total debt service savings to the City was $728,360 at the
date of issuance. The outstanding principal of the defeased bonds was $10,360,000
at December 31, 2014.
CITY OF ITHACA
NOTES TO FINANCIAL STATEMENTS
FOR THE YEAR ENDED DECEMBER 31, 2014
-31-
Note 3 Detailed Notes -Continued
b.Other Long-term Debt and Liabilities
In addition to the above long-term debt, the City had the following non-current
liabilities:
Compensated Absences -Represents the unfunded value of the liability for
compensated absences and is liquidated in the General, Water, Sewer, and
Refuse and Garbage Funds.
Other Postemployment Benefits Payable -Represents the liability for future
health insurance benefits. See Note 3.B.4 for more information.
Lease Obligations Payable -Represents the amount outstanding on a capital
lease for energy improvements. The gross amount of assets in the Statement
of Net Position recorded under capital leases is $4,746,465, which is recorded
under buildings and the associated accumulated amortization,which is
reported in depreciation expense,of these assets, is $1,096,652.
c.Changes in Indebtedness and Other Long-term Liabilities
The following is a summary of changes in the City’s indebtedness and long-term
liabilities for the period ended December 31, 2014:
Description
Balance
12/31/13
New Issues/
Additions
Maturities/
Payments
Balance
12/31/14
Due Within
One Year
General obligation and
statutory installment bonds $ 64,168,320 $ 11,760,000 $ (16,518,843)$ 59,409,477 $ 4,606,510
Add premium 585,0811,133,582 (83,583)1,635,080 186,636
Total Bonds 64,753,40112,893,582(16,602,426)61,044,557 4,793,146
BANs 31,250,03349,351,225(30,717,401)49,883,887 49,883,887
Add unamortized premium 237,669391,406(237,669)391,406 391,406
Total BANs 31,487,73249,742,631(30,955,070)50,275,293 50,275,293
Lease obligations payable 3,027,212 (337,441)2,689,771 345,090
Liability for other
postemployment benefits 87,025,46218,646,100(3,126,357)102,545,205 -0-
Compensated absences 2,484,06791,884 2,575,951 119,922
Total $ 188,777,874 $ 81,374,197 $ (51,021,294)$ 219,130,777 $55,533,451
CITY OF ITHACA
NOTES TO FINANCIAL STATEMENTS
FOR THE YEAR ENDED DECEMBER 31, 2014
-32-
Note 3 Detailed Notes -Continued
d.Summary of Serial Bonds
As of December 31, 2014, the Serial Bonds, including issue and maturity dates and
interest rates, consisted of the following:
Date of Final Interest Payable to
Description of Issue Issue Maturity Rate Maturity
1998 EFC Bonds 199820175.05%$260,000
1998 EFC Bonds 199820175.05%60,000
2000 Water Treatment Improvement 200020205.50%395,000
2001 Statutory Installment Bond 200120174.64%232,160
2008 Public Improvement 200820234.00%3,880,000
2008 Parking Garage 200820326.63%3,330,000
2009 Parking Garage 200920245.63%830,000
2010 Public Improvement 201020345.00%7,070,000
2010 Public Improvement 201020274.00%8,419,700
2012 Refunding Bonds 201220152.00%6,420,000
2013 Public Improvement 201320373.00%13,759,430
2013 Public Improvement 201320232.00%165,000
2013 Public Improvement 201320353.00%2,828,187
2014 Refunding Bonds 200720254.13%11,760,000
Subtotal Bonds 59,409,477
Add unamortized premium 1,635,080
Total Bonds $61,044,557
IAWWTP
Phosphorous Removal Improvements 200520353.349%$1,685,000
Plant Improvements 201020273.00%1,085,000
Energy Upgrades 201320373.00%2,950,570
Plant Improvements 201320353.00%121,813
IAWWTP Total Bonds $5,842,683
Additions and deletions to compensated absences are shown net,as it is impractical
to determine these amounts separately.
CITY OF ITHACA
NOTES TO FINANCIAL STATEMENTS
FOR THE YEAR ENDED DECEMBER 31, 2014
-33-
Note 3 Detailed Notes -Continued
e.Debt Maturity Schedule
The following table summarizes the City's future debt service requirements as of
December 31, 2014:
Year Ending Bonds Bonds and BANs
December 31,Principal Interest Principal Interest
2015 $4,606,510 $2,292,256 $54,490,397$2,811,249
2016 4,235,190 2,226,158 4,235,190 2,226,158
2017 4,383,904 2,062,114 4,383,904 2,062,114
2018 4,352,313 1,892,917 4,352,3131,892,917
2019 3,641,230 1,739,252 3,641,230 1,739,252
2020-2024 17,597,330 6,431,834 17,597,330 6,431,834
2025-2029 10,401,960 3,243,339 10,401,960 3,243,339
2030-2034 7,648,410 1,357,608 7,648,410 1,357,608
2035-2037 2,542,630 154,994 2,542,630 154,994
Total $ 59,409,477 $ 21,400,472$109,293,364$21,919,465
The following is a statement of installment purchase debt with corresponding maturity
schedules.
Description By Fund
Date of
Issue Interest
Maturity
Date Outstanding
General Fund:
Building improvements 20074.03%8/30/22 $833,809
Building improvements 20070.03%8/30/17 291,272
Sewer Fund:
Building improvements 20074.03%8/30/22 12,454
Building improvements 20070.03%8/30/17 4,350
Water meter replacement 20094.91%11/20/23 1,000,140
Water Fund:
Building improvements 20074.03%8/30/22 6,825
Building improvements 20070.03%8/30/17 2,384
Water meter replacement 20094.91%11/20/23 538,537
Total Installment Purchase Debt $2,689,771
CITY OF ITHACA
NOTES TO FINANCIAL STATEMENTS
FOR THE YEAR ENDED DECEMBER 31, 2014
-34 -
Note 3 Detailed Notes -Continued
The following table summarizes the City’s future lease obligation requirements as of
December 31, 2014:
Year Ending Capital Lease
December 31,Principal Interest
2015 $345,090 $66,899
2016 352,994 58,732
2017 361,161 50,299
2018 270,205 41,608
2019 278,897 74,787
2020-2023 1,081,424 74,801
Total $ 2,689,771 $ 367,127
The following table summarizes the future debt service requirements of the Wastewater
Treatment Plant joint venture, less interest subsidies, as of December 31, 2014:
Year Ending Bonds
December 31,Principal Interest
2015 $222,390 $172,413
2016 227,140 166,636
2017 237,026 160,119
2018 242,687 153,350
2019 248,770 146,363
2020-2024 1,372,670 609,409
2025-2029 1,403,040 381,397
2030-2034 1,271,590 203,283
2035-2037 617,370 40,074
Total $5,842,683$2,033,044
Interest on long-term debt for the year ended December 31, 2014is as follows:
Interest paid $ 2,969,062
Less: Interest accrued in the prior year (534,247)
Plus: Interest accrued in the current year 1,010,035
Plus: Amortization of deferred amounts 49,483
Less: Amortization of premium (83,583)
Total Expense $ 3,410,750
CITY OF ITHACA
NOTES TO FINANCIAL STATEMENTS
FOR THE YEAR ENDED DECEMBER 31, 2014
-35-
Note 3 Detailed Notes -Continued
4.Postemployment Benefits Other Than Pensions
An actuarial valuation of the Plan was performed as of January 1, 2012 using the
projected unit cost method.
Plan Description. The Plan is a single-employer, defined benefit healthcare plan
administered by the City. The Plan consists of a self insured minimum premium
traditional indemnity plan, a self insured PPO plan, and a community rated Medicare
supplemental plan to eligible retirees and dependents. The Plan provides medical,
prescription drug, dental, and vision benefits to eligible retirees, spouses, and their
covered dependents. Benefit provisions are established through negotiations between
the City and bargaining units and are renegotiated each three-year period. The City
assigns the authority to establish and amend benefit provisions to the City Council for
non-bargaining unit employees. The Plan does not issue a stand-alone financial report.
The contribution requirements of Plan members and the City are established and may be
amended by the City Council. The City Council has negotiated several collective
bargaining agreements, which include obligations of Plan members and the City. The
required contribution is based on projected pay-as-you-go financing requirements. For
the year ended December 31, 2014, the City had expected employer contributions of
$2,875,635 to the Plan for current premiums. Plan members receiving benefits may be
required to contribute to the Plan depending on their collective bargaining unit.
The City’s annual other postemployment benefit (OPEB) cost (expense) is calculated
based on the annual required contribution of the employer (ARC), an amount actuarially
determined in accordance with the parameters of GASB Statement No.45. The ARC
represents a level of funding that, if paid on an ongoing basis, is projected to cover
normal cost each year and accumulate sufficient total accruals for all postretirement
benefits when due.
CITY OF ITHACA
NOTES TO FINANCIAL STATEMENTS
FOR THE YEAR ENDED DECEMBER 31, 2014
-36-
Note 3 Detailed Notes -Continued
The following table shows the components of the City’s annual OPEB cost for the year,
the amount actually contributed to the Plan, and changes in the City’s net OPEB
obligation to the City’s Plan:
Annual required contribution $ 20,653,277
Interest on net OPEB obligation 3,481,019
Adjustment to annual required contribution (5,488,196)
Total Annual OBEB Cost (expense) 18,646,100
Contributions made (expected)(3,126,357)
In crease in Net OPEB Obligation 15,519,743
Net OPEB Obligation -January 1, 2014 87,025,462
Net OPEB Obligation -December 31, 2014 $ 102,545,205
The City’s annual OPEB cost, the percentage of annual OPEB cost contributed to the
Plan, and the net OPEB obligation for 2014, 2013 and 2012 are as follows:
Fiscal
Year Ended
Annual
OPEB Cost
Percentage of
Annual OPEB
Cost Contributed
Net OPEB
Obligation
12/31/2014$ 18,646,10016.8%$102,545,205
12/31/2013 $ 18,317,04115.7%$87,025,462
12/31/2012 $ 17,382,09914.9%$71,581,056
Funded Status and Funding Progress -As of December 31, 2014, the Plan was not
funded. Actuarial accrued liability for benefits was $185,062,873; there are no assets
legally segregated for the Plan. The covered payroll (annual payroll of active
employees covered by the Plan) was $25,343,216 and the ratio of the Unfunded
Actuarial Accrued Liability (UAAL) to the covered payroll was 730.2%.
Actuarial valuations of an ongoing Plan involve estimates of the value of reported
amounts and assumptions about the probability of occurrence of events far into the
future. Examples include assumptions about future employment, mortality, and
healthcare cost trends. Amounts determined regarding funded status of the Plan and
annual required contributions of the employer are subject to continual revision as actual
results are compared with past expectations and new estimates are made about the
future.
CITY OF ITHACA
NOTES TO FINANCIAL STATEMENTS
FOR THE YEAR ENDED DECEMBER 31, 2014
-37-
Note 3 Detailed Notes -Continued
Actuarial Methods and Assumptions -Projections of benefits for financial reporting
purposes are based on the substantive Plan (the Plan as understood by the employer
and the Plan members) and include the types of benefits provided at the time of each
valuation and the historical pattern of sharing of benefit costs between the employer
and Plan members to that point. The actuarial methods and assumptions used
include techniques that are designed to reduce the effects of short-term volatility in
actuarial accrued liabilities and the actuarial value of assets, consistent with the
long-term perspective of the calculations.
In the January 1, 2014, Actuarial Valuation Report, the projected unit credit method was
used. The actuarial value of assets was determined as the accumulation of prior
accruals, less benefits paid. Actuarial assumptions included an annual discount rate of
4%. Additional actuarial assumptions included an annual medical cost trend rate of
6.5%, decreased by decrements to a trend rate of 4.2% in 2084, using the SOA Long-
Run Medical Cost Trend Model.
C.Interfund Receivables and Payables
During the course of normal operations, the City has numerous transactions between funds
including expenditures and transfers of resources, primarily to provide services, which are
routine annual events for the budget and accounting process.
Interfund receivables and payables at December 31, 2014 were as follows:
InterfundInterfundInterfundInterfund
Receivables Payables Revenue Expense
General Fund $ 500,784$478,321$1,179,643$11,000
Water Fund 38,603149,06912,500306,000
Sewer Fund 688,04326,500360,000
Capital Projects Fund 861,0603,524,15911,000552,643
Non-Major Funds 3,512,38773,242
Total $ 4,912,834$4,912,834$1,229,643$1,229,643
CITY OF ITHACA
NOTES TO FINANCIAL STATEMENTS
FOR THE YEAR ENDED DECEMBER 31, 2014
-38-
Note 3 Detailed Notes -Continued
D.Fund Equity
1.Fund Balances
a.Fund Balance Detail
At December 31, 2014, fund balance in the governmental funds was comprised of
the following:
General
Fund
Water
Fund
Sewer
Fund
Special
Grant
Fund
Capital
Fund
Non-
Major
Funds
Nonspendable
Prepaid expenses $1,075,446$81,389$122,107$$$13,522
Inventory 197,290494,60486,142
Permanent Fund balance 49,278
Total Nonspendable Fund Balance $1,272,736$575,993$208,249$-0-$-0-$62,800
Restricted
Capital reserves $487,581$3,803,578$2,449,197$$$
Unspent grant funds 2,003,800
Miscellaneous 22,921
Debt 3,612,714
Total Restricted Fund Balance $487,581$3,803,578$2,449,197$2,003,800$-0-$3,635,635
Assigned
Appropriated for next year’s budget $393,177$$$$$
Encumbered for:
General government 221,021
Public safety 188,996
Transportation 57,199
Culture and recreation 9,663
Home and community services 90,9542,158
Assigned for insurance 1,706,65753,19542,795
Assigned for workers’ compensation 100,000
Remaining fund balance:
Transportation 501,086
Home and community services 1,104,0641,157,377 125,000
Total Assigned Fund Balance $2,767,667$1,159,417$1,200,172$-0-$-0-$626,086
Unassigned
Unassigned Fund Balance (Deficit)$3,291,284$-0-$-0-$-0-$(9,450,069)$(359,850)
CITY OF ITHACA
NOTES TO FINANCIAL STATEMENTS
FOR THE YEAR ENDED DECEMBER 31, 2014
-39-
Note 3 Detailed Notes -Continued
b.Reconciliation between Restricted Fund Balance and Restricted Net Position
Restricted fund balances and restricted net position differ because loans receivable
in the Special Grant Fund are deferred in the fund financial statements, and reported
as restricted in the Statement of Net Assets. Additionally, fund balance in the
Permanent Fund is reported as restricted, nonexpendable in the Statement of Net
Position and nonspendable in the fund financial statements
Restricted fund balance in the fund financial statements $12,379,791
Add loans receivable in the Special Grant Fund 6,778,112
Add Permanent Fund balance 49,278
Restricted net position in the government-wide financial
statements $19,207,181
2.Miscellaneous Fund Equity
Fund equity for the Miscellaneous Fund includes funds established for the following
purposes:
Purpose:
Cemetery maintenance $3,000
Stewart Park landscaping 17,796
Stewart Park carousel 1,240
Dewysocki memorial 283
Rick Gray memorial 585
Moore 17
Total $ 22,921
Note 4 Joint Ventures
The following is the activity undertaken jointly with another municipality. Except for their
equity interest in the joint venture, this activity is excluded from the financial statements of the
participating municipalities. Separate financial statements are issued for this joint venture and
may be obtained from their administrative office.
CITY OF ITHACA
NOTES TO FINANCIAL STATEMENTS
FOR THE YEAR ENDED DECEMBER 31, 2014
-40-
Note 4 Joint Ventures -Continued
A.Tompkins Consolidated Area Transit (TCAT)
TCAT was formed under a consolidation agreement between the City, Tompkins County,
and Cornell University effective April 1, 1998. The agreement shall remain in force until
October 9, 2021. TCAT began operations on January 1, 1999, with its purpose to provide
public transportation in Tompkins County and surrounding areas. As of January 1, 2005,
TCAT was reorganized as a 501(c)(3). However, the structure of the Board, and the interest
of each party was not changed. Significant provisions of the agreement are as follows:
1.TCAT is governed by a Board of Directors consisting of nine voting members with three
members being appointed by each participant in the venture. The General Manager of
TCAT is a non-voting ex-officio member of the Board. In addition, the nine voting
members of the Board select five additional non-voting, ex-officio members.
2.Interest of each party in surpluses, losses, property, and in debt acquired by TCAT shall
be shared equally.
3.Each party makes an annual contribution of equal amounts to the venture. The City’s
contribution for 2014 was $829,432. For 2015,the contribution will be $829,432.
4.The financial statements of TCAT are audited annually and may be obtained from their
administrative office. The following is an audited summary of financial information
included in financial statements for the joint venture as of December 31, 2014:
Year
Ending
12/31/14
Total assets $ 16,983,262
Total liabilities 5,728,476
Joint venture equity11,254,786
Total revenues 13,850,846
Total expenses 14,709,771
B.Ithaca Area Wastewater Treatment Plant
The following is an activity undertaken jointly with other municipalities. The financial
statements of the Ithaca Area Wastewater Treatment Plant may be obtained from their
administrative office.
CITY OF ITHACA
NOTES TO FINANCIAL STATEMENTS
FOR THE YEAR ENDED DECEMBER 31, 2014
-41-
Note 4 Joint Ventures -Continued
The City and Towns of Ithaca and Dryden jointly own the Ithaca Area Wastewater Treatment
Plant. The venture operates under the terms of an agreement dated 1981. The agreement is
for a period of 25 years. An updated agreement was signed in 2003 and remains in effect
until 2035, the year debt associated with phosphorous removal is paid off. Significant
provisions of the agreement are as follows:
1.The Boards of each municipality jointly act as the governing body for the joint venture.
2.Debt for capital cost is issued by each participant in the following ratios:
City of Ithaca 57.14%
Town of Ithaca 40.88%
Town of Dryden 1.98%
Debt issued by the City for the joint venture is shown in Notes 3.B.2 and 3.
3.The governing body has established charges at rates intended to be self-sustaining to
cover all operating costs and debt service. Any shortfall in revenues produced by such
charges is to be provided by equal share contributions from the participants.
The following is an audited summary of financial information included in the basic financial
statements issued for the joint venture:
Year Ending
12/31/14
Total assets $ 33,067,615
Total liabilities 16,985,974
Joint venture equity 16,081,641
Total revenues 3,213,594
Total expenditures 5,272,517
Note 5 Public Entity Risk Pool
A.Risk Financing
The City participates in a workers' compensation insurance plan (Plan) sponsored by the
Tompkins County Self-Insurance Risk Pool. The Plan's objectives are to formulate,
develop, and administer a program of insurance to obtain lower costs for that coverage, and
to develop a comprehensive loss control program. Plan members are subject to a
supplemental assessment in the event of deficiencies. If the Plan's assets were to be
exhausted, members would be responsible for the Plan's liabilities.
CITY OF ITHACA
NOTES TO FINANCIAL STATEMENTS
FOR THE YEAR ENDED DECEMBER 31, 2014
-42-
Note 5 Public Entity Risk Pool -Continued
The Plan establishes a liability for both reported and unreported insured events, which
includes estimates of both future payments of losses and related claim adjustment expenses.
However, because actual claims costs depend on complex factors, the process used in
computing claims liabilities does not necessarily result in an exact amount. Such claims
are based on the ultimate cost of claims (including future claim adjustment expenses) that
have been reported but not settled, and claims that have been incurred but not reported.
Adjustments to claims liabilities are charged or credited to expense in the periods in which
they are made.
During the year ended December 31, 2014, the City incurred premiums or contribution
expenditures totaling $975,935.
Note 6 Summary of Significant Commitments and Contingencies
A.General Information
The City is exposed to various risks of loss related to, but not limited to, torts; theft of,
damage to, and destruction of assets; injuries to employees; errors and omissions; natural
disasters. These risks are covered by commercial insurance purchased from independent
third parties. Settled claims from these risks have not exceeded commercial insurance
coverage for the past three years.
B.Judgments and Claims
The City and/or its agencies are named in several lawsuits, some of which are for
substantial amounts. Most of these claims are either adequately covered by insurance or, in
the opinion of City officials, will not result in material judgments against the City or will
not be pursued and, therefore, are not expected to have a material effect on the basic
financial statements. There is one claim outstanding that could result in a material
judgment against the City. However, the amount and probability of the claim cannot be
determined at this time; therefore, no amount has been accrued in the financial statements.
C.State and Federally Assisted Programs
The City receives many different state and federal grants to be used for specific purposes.
These grants are generally conditioned on compliance with certain statutory, regulatory
and/or contractual requirements. The City makes every effort to comply with all applicable
requirements. However, because these grants are audited from time to time, it is possible
that the City will be required, upon audit, to repay portions of the grant monies received
and recorded as revenue in a prior year. City officials do not anticipate material grant-in-
aid disallowances, and no provision, therefore, is reflected in the basic financial statements.
D.Other Contingencies
As described in Note 4, the City is a partner in TCAT, a joint venture,and shares equally in
surpluses or losses. The City may, in the future, be required to provide additional resources
to finance its share of any operating deficits of TCAT. However, that amount, if any, for the
year ended December 31, 2014 is undeterminable as of this report date.
CITY OF ITHACA
NOTES TO FINANCIAL STATEMENTS
FOR THE YEAR ENDED DECEMBER 31, 2014
-43-
Note 7 Letter of Credit
Under its third party agreement for workers’ compensation, the City is required to maintain a
$525,000 letter of credit as collateral for payment of workers’ compensation obligations. At
December 31, 2014, the City had not utilized this letter of credit.
Note 8 Subsequent Events
On February 19, 2015 the City issued $35,388,228 of BAN’s,due February 19, 2016. The
proceeds of the notes, along with $421,267 in available monies,will refund in full $25,649,035
BAN’s outstanding which mature on February 19, 2015 and provide $10,160,460 in new
monies for various public improvement projects.
On February 19, 2015,the City issued $910,000 of federally-taxable BAN’s,due February 19,
2016. The proceeds of the notes will refund in full $330,000 BAN’s outstanding which mature
on February 19, 2015 and provide $580,000 in new monies for the Seneca Street Parking
Garage.
On July 31, 2015, the City issued $34,938,306 of BAN’s due July 29, 2016. The proceeds of
the notes,along with the $526,282 in available funds,will refund in full $31,173,025 BAN’s
outstanding which mature on July 31, 2015 and provide $4,291,563 in new monies for various
public improvement projects.
On February 19, 2016, the City issued $18,943,221 of serial bonds with various years of
maturity;February 15, 2017-2046. The proceeds of the Bonds, along with $718,909 in
available funds, will redeem a $19,662,130 portion of the $35,388,228 BAN’s outstanding
which mature on February19, 2016.
On February 19,2016, the City issued $20,306,900 of BAN’s due February 17, 2016. The
proceeds of the notes, along with $187,275 in available monies, will redeem $207,241 of the
$910,000 BAN’s maturing February 19, 2016 and redeem $15,550,377 of the $35,388,228
BAN’s outstanding which mature on February 19, 2016 and provide $4,553,940 in new monies
for various public improvement projects.
On February 19, 2016, the City issued $700,000 of federally taxable BAN’s, due February 17,
2017. The proceeds of the notes, along with $2,759 in available funds, will redeem in full
$702,759 BANs outstanding which mature on February 19, 2016 for various public
improvement projects.
Note 9 Restatement of Prior Year Statement of Net Position
During the ye ar, the It haca Area Wastewater Treatment Facilit y restated capital assets by
decreasing capital assets, net of accumulated depreciation by $(36,462). Therefore, the City’s
equity interest in joint ventures decreased $(20,834)as of December 31, 2013.
Original Final Variance
Budget Budget Actual Encumbrances Fav./(Unfav.)
REVENUES
Real property taxes $20,520,104 $20,520,104 $20,515,747 $$(4,357)
Real property tax items 737,500 737,500 797,917 60,417
Nonproperty tax items 13,624,000 13,624,000 13,880,274 256,274
Departmental income 4,482,805 4,672,775 4,081,541 (591,234)
Intergovernmental charges 4,047,679 4,074,179 3,884,948 (189,231)
Use of money and property 375,000 375,000 304,793 (70,207)
Licenses and permits 779,050 779,050 951,807 172,757
Fines and forfeitures 1,170,000 1,170,000 1,086,057 (83,943)
Sale of property and compensation for loss 375,500 376,199 497,456 121,257
Miscellaneous local sources 1,334,053 1,368,288 1,305,433 (62,855)
Interfund revenues 282,294 282,294 282,294 -0-
State sources 3,195,259 3,197,769 3,446,149 248,380
Federal sources 15,000 423,428 371,022 (52,406)
Total Revenues 50,938,244 51,600,586 51,405,438 -0-(195,148)
EXPENDITURES
Current:
General governmental support 4,844,099 5,634,606 5,412,959 221,021 626
Public safety 13,258,933 13,623,207 13,410,005 188,996 24,206
Transportation 4,958,658 5,334,269 5,276,969 57,199 101
Economic assistance and opportunity 61,000 61,000 61,000 -0-
Culture and recreation 5,267,536 5,511,037 5,415,224 9,663 86,150
Home and community services 1,840,129 1,798,313 1,707,358 90,954 1
Employee benefits 16,224,202 15,486,820 15,254,314 232,506
Debt Service:
Principal and Interest 6,467,917 6,466,558 6,465,132 1,426
Total Expenditures 52,922,474 53,915,810 53,002,961 567,833 345,016
Excess of (Expenditures) (1,984,230) (2,315,224) (1,597,523) (567,833) 149,868
OTHER FINANCING SOURCES (USES)
Interfund transfers in 1,362,208 1,362,208 1,179,643 (182,565)
Interfund transfers (out)(11,000) (11,000)
Total Other Financing Sources 1,362,208 1,362,208 1,168,643 -0-(193,565)
Excess of (Expenditures) and Other (Uses)
Over Revenues and Other Financing Sources (622,022) (953,016) (428,880)$(567,833) $(43,697)
Appropriated Fund Balances 622,022 953,016
Net Change in Fund Balance $-0-$-0-(428,880)
Fund Balance, Beginning 8,248,148
Fund Balance, Ending $7,819,268
See Independent Auditor's Report and Notes to Required Supplementary Information.
- 44 -
CITY OF ITHACA
BUDGETARY COMPARISON SCHEDULE
GENERAL FUND - NON-GAAP BUDGET BASIS
FOR THE YEAR ENDED DECEMBER 31, 2014
Original Final Variance
Budget Budget Actual Encumbrances Fav./(Unfav.)
REVENUES
Departmental income $4,173,193 $4,173,193 $4,344,618 $$171,425
Intergovernmental charges 1,500 173 (1,327)
Use of money and property 1,500 1,500 5,297 3,797
Sale of property and compensation for loss 4,200 4,200 9,228 5,028
State sources 10,000 10,000
Total Revenues 4,178,893 4,180,393 4,369,316 -0-188,923
EXPENDITURES
Current:
General governmental support 210,253 165,157 165,133 24
Home and community services 2,259,536 2,229,342 2,117,517 2,158 109,667
Employee benefits 965,186 903,487 906,224 (2,737)
Debt Service:
Principal and interest 773,918 773,538 773,537 1
Total Expenditures 4,208,893 4,071,524 3,962,411 2,158 106,955
Excess of (Expenditures) Revenues (30,000) 108,869 406,905 (2,158) 295,878
OTHER FINANCING SOURCES (USES)
Interfund transfers in 30,000 30,000 12,500 -0-
Interfund transfers (out)(180,000)(306,000) (126,000)
Total Other Financing Sources (Uses)30,000 (150,000) (293,500) -0-(126,000)
Excess of (Expenditures) and Other (Uses)
Over Revenues and Other Financing Sources -0-(41,131) 113,405 $(2,158) $169,878
Appropriated Fund Balances -0-41,131
Net Change in Fund Balance $-0-$-0-113,405
Fund Balance, Beginning 5,425,583
Fund Balance, Ending $5,538,988
See Independent Auditor's Report and Notes to Required Supplementary Information.
BUDGETED MAJOR SPECIAL REVENUE FUNDS - NON-GAAP BUDGET BASIS
FOR THE YEAR ENDED DECEMBER 31, 2014
Water Fund
- 45 -
CITY OF ITHACA
BUDGETARY COMPARISON SCHEDULE
Original Final Variance
Budget Budget Actual Encumbrances Fav./(Unfav.)
REVENUES
Departmental income $5,964,216 $5,964,216 $5,811,904 $$(152,312)
Intergovernmental charges 80,000 16,345 (63,655)
Use of money and property 1,000 1,000 3,915 2,915
Sale of property and compensation for loss 3,500 3,500 3,679 179
Total Revenues 5,968,716 6,048,716 5,835,843 -0-(212,873)
EXPENDITURES
Current:
General governmental support 246,454 246,454 205,881 40,573
Home and community services 3,448,683 3,085,828 2,959,773 126,055
Employee benefits 1,383,319 1,379,336 1,317,920 61,416
Debt Service:
Principal and interest 940,260 941,323 937,147 4,176
Total Expenditures 6,018,716 5,652,941 5,420,721 -0-232,220
Excess of Revenues (Expenditures) (50,000) 395,775 415,122 -0-19,347
OTHER FINANCING SOURCES (USES)
Interfund transfers in 50,000 50,000 26,500 -0-
Interfund transfers (out)(370,000)(360,000) 10,000
Total Other Financing Sources (Uses)50,000 (320,000) (333,500) -0-10,000
Excess of (Expenditures) and Other (Uses)
Over Revenues and Other Financing Sources -0-75,775 81,622 $-0-$29,347
Appropriated Fund Balances -0-(75,775)
Net Change in Fund Balance $-0-$-0-81,622
Fund Balance, Beginning 3,775,996
Fund Balance, Ending $3,857,618
See Independent Auditor's Report and Notes to Required Supplementary Information.
`
CITY OF ITHACA
Sewer Fund
BUDGETARY COMPARISON SCHEDULE
BUDGETED MAJOR SPECIAL REVENUE FUNDS - NON-GAAP BUDGET BASIS
FOR THE YEAR ENDED DECEMBER 31, 2014
- 46 -
Actuarial UAAL as a
Actuarial Actuarial Accrued Unfunded Percentage
Year Valuation Value of Liability (AAL) -AAL Funded Covered of Covered
Ended Date Assets Entry Age (UAAL)Ratio Payroll Payroll
12/31/2014 1/1/2014 $-0-$185,062,873 $185,062,873 0.0%$25,343,216 730.2%
12/31/2013 1/1/2012 $-0-$183,260,021 $183,260,021 0.0%$24,627,256 744.1%
12/31/2012 1/1/2012 $-0-$171,191,232 $171,191,232 0.0%$24,806,755 690.1%
12/31/2011 1/1/2010 $-0-$169,138,833 $169,138,833 0.0%$24,731,799 683.9%
12/31/2010 1/1/2010 $-0-$157,341,377 $157,341,377 0.0%$23,644,783 665.4%
12/31/2009 1/1/2008 $-0-$156,222,425 $156,222,425 0.0%$23,343,418 669.2%
12/31/2008 1/1/2008 $-0-$143,189,980 $143,189,980 0.0%$22,588,908 633.9%
See Independent Auditor's Report and Notes to Required Supplementary Information.
CITY OF ITHACA
SCHEDULE OF FUNDING PROGRESS
FOR THE YEAR ENDED DECEMBER 31, 2014
- 47 -
CITY OF ITHACA
NOTES TO REQUIRED SUPPLEMENTARY INFORMATION
FOR THE YEAR ENDED DECEMBER 31, 2014
-48-
Note 1 Budgeting Policies
The budget policies are as follows:
1.No later than September 1, the budget officer submits a tentative budget to the
Common Council for the fiscal year commencing the following January 1. The
tentative budget includes proposed expenditures and the proposed means of
financing for all funds.
2.After public hearings are conducted to obtain taxpayer comments, no later than
December 31, the governing board adopts the budget.
3.All modifications of the budget must be approved by the governing board.
(However, the Controller is authorized to transfer certain budgeted amounts within
departments.)
Note 2 Budget Basis of Accounting
Except as indicated below, budgets are adopted annually on a basis consistent with accounting
principles generally accepted in the United States of America. Appropriations authorized for
the current year are increased by the amount of encumbrances carried forward from the prior
year. Encumbrances are not considered a disbursement in the financial plan or an expenditure
in GAAP based financial statements. Encumbrances reserve a portion of the applicable
appropriation for purchase orders, contracts, and other commitments not expended at year end,
thereby ensuing that appropriations are not exceeded.
An annual legal budget is not adopted for the Special Grant Fund, which is one of the Special
Revenue Funds. Budgetary controls for the Special Grant Fund are established in accordance
with the applicable grant agreements. The Special Grant Fund also covers a period other than
the City’s fiscal year.
Note 3 Reconciliation of the General Fund Budget Basis to GAAP
No adjustment is necessary to convert the General Fund’s excess of revenues and other sources
over expenditures and other uses on the GAAP basis to the budget basis. Encumbrances, if
present, are presented in a separate column and are not included in the actual results at
December 31, 2014.
Note 4 Schedule of Funding Progress
The Schedule of Funding Progress, presented as required supplementary information presents
multi-year trend information about whether the actuarial value of Plan assets is increasing or
decreasing over time relative to the actuarial accrued liabilities for benefits.
Urban Sidewalk
Refuse and Renewal Improvement
Garbage Agency Miscellaneous District
Fund Fund Fund Fund
ASSETS
Assets:
Cash and cash equivalents - Unrestricted $$$19,921 $208,156
Due from other funds 23,900 435,791
Other receivables, net 22,682 398,079
Prepaid expenses 11,164 2,358
Cash and cash equivalents - Restricted 3,000
Total Assets $57,746 $398,079 $22,921 $646,305
LIABILITIES AND FUND BALANCES
Liabilities:
Accounts payable $359,298 $$$114,606
Due to other funds 44,987 28,255
Due to other governments 2,594 273,079
Other liabilities (447)
Total Liabilities 406,432 273,079 -0-142,861
Fund Balances:
Nonspendable 11,164 2,358
Restricted 22,921
Assigned 125,000 501,086
Unassigned (359,850)
Total Fund Balances (Deficit)(348,686) 125,000 22,921 503,444
Total Liabilities and Fund Balances $57,746 $398,079 $22,921 $646,305
See Independent Auditor's Report.
- 49 -
CITY OF ITHACA
COMBINING BALANCE SHEET
NON-MAJOR GOVERNMENTAL FUNDS
DECEMBER 31, 2014
Special Revenue Funds
Total
Debt Non-Major
Service Permanent Governmental
Fund Fund Funds
$$$228,077
3,052,696 3,512,387
420,761
13,522
560,018 49,278 612,296
$3,612,714 $49,278 $4,787,043
$$$473,904
73,242
275,673
(447)
-0--0-822,372
49,278 62,800
3,612,714 3,635,635
626,086
(359,850)
3,612,714 49,278 3,964,671
$3,612,714 $49,278 $4,787,043
- 49a -
Urban Sidewalk
Refuse and Renewal Improvement
Garbage Agency Miscellaneous District
Fund Fund Fund Fund
REVENUES
Nonproperty tax items $$$$860,651
Departmental income 501,489
Use of money and property 17 20 339
Total Revenues 501,506 -0-20 860,990
EXPENDITURES
Current:
General governmental support
Transportation 321,846
Home and community services 419,587
Employee benefits 179,008 35,700
Debt Service:
Principal 8,455
Interest 3,524
Total Expenditures 610,574 -0--0-357,546
Excess of Revenues (Expenditures) (109,068) -0-20 503,444
OTHER FINANCING SOURCES (USES)
Proceeds of long-term debt
Premiums on obligations
Payments to escrow agent
Total Other Financing Sources -0--0--0-
Excess of (Expenditures) and Other (Uses)
Over Revenues and Other Financing Sources (109,068) -0-20 503,444
Fund Balances, (Deficit) Beginning (239,618) 125,000 22,901
Fund Balances, (Deficit) Ending $(348,686) $125,000 $22,921 $503,444
See Independent Auditor's Report.
AND CHANGES IN FUND BALANCES - NON-MAJOR GOVERNMENTAL FUNDS
FOR THE YEAR ENDED DECEMBER 31, 2014
CITY OF ITHACA
- 50 -
Special Revenue Funds
COMBINING STATEMENT OF REVENUES, EXPENDITURES,
Total
Debt Non-Major
Service Permanent Governmental
Fund Fund Funds
$$$860,651
501,489
649 78 1,103
649 78 1,363,243
95,885 95,885
321,846
78 419,665
214,708
8,455
237,669 241,193
333,554 78 1,301,752
(332,905) -0-61,491
9,945,000 9,945,000
1,524,988 1,524,988
(10,982,698)(10,982,698)
487,290 -0-487,290
154,385 -0-548,781
3,458,329 49,278 3,415,890
$3,612,714 $49,278 $3,964,671
- 50a -
INDEPENDENT AUDITOR’S 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
Common Council
City of Ithaca
Ithaca, New York
We have audited in accordance with the auditing standards generally accepted in the United States of America
and the standards applicable to financial audits contained in Government Auditing Standards, issued by the
Comptroller General of the United States, the financial statements of the governmental activities, the aggregate
discretely presented component units, each major fund, and the aggregate remaining fund information of the City
of Ithaca (the City), as of and for the year ended December 31, 2014, which collectively comprise the City's basic
financial statements and have issued our report thereon dated March 17, 2016.
Internal Control Over Financial Reporting
In planning and performing our audit of the financial statements, we considered the City of Ithaca’s internal
control over financial reporting (internal control) to determine the audit procedures that are appropriate in the
circumstances for the purpose of expressing our opinions on the financial statements, but not for the purpose of
expressing an opinion on the effectiveness of the City's internal control. Accordingly, we do not express an
opinion on the effectiveness of the City's internal control.
Our consideration of internal control was for the limited purpose described in the preceding paragraph and was
not designed to identify all deficiencies in internal control that might be material weaknesses or significant
deficiencies and therefore, material weaknesses or significant deficiencies may exist that were not identified.
However, as described in the accompanying schedule of findings and questioned costs, we id entified certain
deficiencies in internal control that we consider to be a material weakness.
A deficiency in internal control exists when the design or operation of a control does not allow management or
employees, in the normal course of performing their assigned functions, to prevent, or detect and correct,
misstatements on a timely basis. A material weakness is a deficiency, or a combination of deficiencies, in
internal control, such that there is a reasonable possibility that a material misstatement of the entity’s financial
statements will not be prevented, or detected and corrected on a timely basis. We consider the deficiency
described in the accompanying Schedule of Findings and Questioned Costs as 10-001 to be a material weakness.
A significant deficiency is a deficiency, or a combination of deficiencies, in internal control that is less severe
than a material weakness, yet important enough to merit attention by those charged with governance.
- 51 -
Insero & Co. CPA s, LLP
Rochester | Ithaca | Corning | Cortland | Watkins Glen | (800) 232-9547 | www.inserocpa.com
- 52 -
Compliance and Other Matters
As part of obtaining reasonable assurance about whether the City’s financial statements are free from material
misstatement, we performed tests of its compliance with certain provisions of laws, regulations, contracts, and
grant agreements, noncompliance with which could have a direct and material effect on the determination of
financial statement amounts. However, providing an opinion on compliance with those provisions was not an
objective of our audit, and accordingly, we do not express such an opinion. The results of our tests disclosed
one instance of noncompliance or other matter that is required to be reported under Government Auditing
Standards, which is described in the accompanying Schedule of Findings and Questioned Costs as item 03-001.
City of Ithaca’s Response to Findings
The City’s responses to the findings identified in our audit are described in the accompanying Schedule of
Findings and Questioned Costs. The City’s responses were not subjected to the auditing procedures applied in
the audit of the financial statements and, accordingly, we express no opinion on them.
Purpose of this Report
The purpose of this report is solely to describe the scope of our testing of internal control and compliance and
the results of that testing, and not to provide an opinion on the effectiveness of the entity’s internal control or on
compliance. This report is an integral part of an audit performed in accordance with Government Auditing
Standards in considering the entity’s internal control and compliance. Accordingly, this communication is not
suitable for any other purpose.
Respectfully Submitted,
Insero & Co. CPAs, LLP
Certified Public Accountants
Ithaca, New York
March 17, 2016
INDEPENDENT AUDITOR’S REPORT ON COMPLIANCE FOR
EACH MAJOR PROGRAM AND ON INTERNAL CONTROL OVER COMPLIANCE
REQUIRED BY OMB CIRCULAR A-133
Common Council
City of Ithaca
Ithaca, New York
Compliance
Report on Compliance for Each Major Federal Program
We have audited the City of Ithaca’s (the City) compliance with the types of compliance requirements described in
the U.S. Office of Management and Budget (OMB) Circular A-133 Compliance Supplement that could have a
direct and material effect on each of the City’s major federal programs for the year ended December 31, 2014.
The City’s major federal programs are identified in the summary of auditor’s results section of the
accompanying schedule of findings and questioned costs.
Management’s Responsibility
Management is responsible for compliance with the requirements of laws, regulations, contracts, and grants
applicable to federal programs.
Auditor’s Responsibility
Our responsibility is to express an opinion on compliance for each of the City’s major federal programs based on
our audit of the types of compliance requirements referred to above. We conducted our audit of compliance in
accordance with auditing standards generally accepted in the United States of America; the standards applicable to
financial audits contained in Government Auditing Standards, issued by the Comptroller General of the United
States; and OMB Circular A-133, Audits of States, Local Governments, and Non-Profit Organizations. Those
standards and OMB Circular A-133 require that we plan and perform the audit to obtain reasonable assurance
about whether noncompliance with the types of compliance requirements referred to above that could have a direct
and material effect on a major federal program occurred. An audit includes examining, on a test basis, evidence
about the City’s compliance with those requirements and performing such other procedures as we considered
necessary in the circumstances.
We believe that our audit provides a reasonable basis for our opinion on compliance for each major federal
program. However, our audit does not provide a legal determination of the City’s compliance.
Opinion on Each Major Federal Program
In our opinion, the City complied, in all material respects, with the types of compliance requirements referred to
above that could have a direct and material effect on each of its major federal programs for the year ended
December 31, 2014.
- 53 -
Insero & Co. CPA s, LLP
Rochester | Ithaca | Corning | Cortland | Watkins Glen | (800) 232-9547 | www.inserocpa.com
- 54 -
Report on Internal Control Over Compliance
Management of the City is responsible for establishing and maintaining effective internal control over
compliance with the types of compliance requirements referred to above. In planning and performing our audit
of compliance, we considered the City’s internal control over compliance with the types of requirements that
could have a direct and material effect on a major federal program to determine the auditing procedures that are
appropriate in the circumstances for the purpose of expressing an opinion on compliance for each major federal
program and to test and report on internal control over compliance in accordance with OMB Circular A-133, but
not for the purpose of expressing an opinion on the effectiveness of internal control over compliance.
Accordingly, we do not express an opinion on the effectiveness of the City’s internal control over compliance.
A deficiency in internal control over compliance exists when the design or operation of a control over
compliance does not allow management or employees, in the normal course of performing their assigned
functions, to prevent, or detect and correct noncompliance with a type of compliance requirement of a federal
program on a timely basis. A material weakness in internal control over compliance is a deficiency, or a
combination of deficiencies, in internal control over compliance, such that there is a reasonable possibility that
material noncompliance with a type of compliance requirement of a federal program will not be prevented, or
detected and corrected on a timely basis. A significant deficiency in internal control over compliance is a
deficiency, or combination of deficiencies, in internal control over compliance with a type of compliance
requirement of a federal program that is less severe than a material weakness in internal control over
compliance, yet is important enough to merit attention by those charged with governance.
Our consideration of internal control over compliance was for the limited purpose described in the first
paragraph of this section and was not designed to identify all deficiencies in internal control over compliance
that might be material weaknesses or significant deficiencies. We did not identify any deficiencies in internal
control over compliance that we consider to be material weaknesses. However, material weaknesses may exist
that have not been identified.
The purpose of this report on internal control over compliance is solely to describe the scope of our testing of
internal control over compliance and the results of that testing based on the requirements of OMB Circular A-
133. Accordingly, this report is not suitable for any other purpose.
Respectfully Submitted,
Insero & Co. CPAs, LLP
Certified Public Accountants
Ithaca, New York
March 17, 2016
Federal Grantor/Pass - Through Grantor Federal Pass - Through
Program Title CFDA #Grantor #Expenditures
U.S. Department of Housing and Urban Development
Community Development Block Grant:
Entitlement Grant 14.218 N/A $383,873
Home Investment Partnerships Program:
Entitlement Grant 14.239 N/A 569,924
Total U.S. Department of Housing and Urban Development 953,797
U.S. Department of Justice
Equitable Sharing Funds (Drug Seizure)16.xxx N/A 28,123
U.S. Department of Transportation
Passed Through NYS Department of Transportation:
Highway Planning and Construction 20.205 D033345 781,726
Highway Planning and Construction 20.205 D033968 35,013
Highway Planning and Construction 20.205 D033368 161,832
Total Highway Planning and Construction Cluster 978,571
Passed Through Tompkins County, New York:
State of Good Repair Grants Program 20.525 NY-04-0101 4,500,000
Total U.S. Department of Tansportation 5,478,571
Environmental Protection Agency
Passed Through NYS Department of Environmental
Conservation:
Brownfields Assessment and Cleanup Cooperative 66.818 C304.177 63,851
Agreements - ARRA
U.S. Department of Homeland Security
Passed Through NYS Department of Transportation:
Flood Mitigation Assistance 97.029 (1)23,081
Passed Through NYS Division of Homeland Services and
Emergency Services:
Homeland Security Grant Program 97.067 (1)119,574
Total U.S. Department of Homeland Security 142,655
U.S. Department of Health & Human Services
Passed Through Tompkins County:
Temporary Assistance to Needy Families 93.558 (1)138,091
Total Expenditures of Federal Awards $6,805,088
(1) Unable to obtain
See Independent Auditor's Report and Notes to Schedule of Expenditures of Federal Awards.
CITY OF ITHACA
SCHEDULE OF EXPENDITURES OF FEDERAL AWARDS
FOR THE YEAR ENDED DECEMBER 31, 2014
- 55 -
CITY OF ITHACA
NOTES TO SCHEDULE OF EXPENDITURES OF FEDERAL AWARDS
FOR THE YEAR ENDED DECEMBER 31, 2014
-56-
Note 1 Basis of Presentation
The accompanying Schedule of Expenditures of Federal Awards presents the activity of all
federal awards programs administered by the City, an entity as defined in Note1 to the City’s
basic financial statements. Federal awards received directly from federal agencies, as well as
federal awards passed through from other government agencies, are included on the Schedule
of Expenditures of Federal Awards.
Note 2 Basis of Accounting
The basis of accounting varies by federal program consistent with the underlying regulations
pertaining to each program. The amounts reported as federal expenditures generally were
obtained from the appropriate federal financial reports for the applicable program and periods.
The amounts reported in these federal financial reports are prepared from records maintained
for each program. These records are periodically reconciled to the general ledger which is the
source of the financial statements.
CITY OF ITHACA
SCHEDULE OF FINDINGS AND QUESTIONED COSTS
FOR THE YEAR ENDED DECEMBER 31, 2014
-57-
Section I Summary of Auditor’s Results:
Financial Statements
Type of auditor’s report issued:Unmodified
Internal control over financial reporting:
Material weakness(es) identified? X yes no
Significant deficiency(ies)identified that
are not considered to be material weakness(es)? yes X none reported
Noncompliance material to financial statements noted? X yes no
Federal Awards
Internal control over major programs:
Material weakness(es) identified? yes X no
Significant deficiency(ies)identified that
are not considered to be material weakness(es)? yes X none reported
Type of auditor’s report issued on compliance
for major programs:Unmodified
Any audit findings disclosed that are required
to be reported in accordance with Section 510(a)
of Circular A-133? yes X no
Identification of major programs:
CFDA Number(s)Name of Federal Program or Cluster
14.239 Home Investment Partnerships Program: Entitlement Grant
20.525 State of Good Repair Grants Program
Dollar threshold used to distinguish between
type A and type B programs $300,000
Auditee qualified as low-risk auditee: yes X no
CITY OF ITHACA
SCHEDULE OF FINDINGS AND QUESTIONED COSTS
FOR THE YEAR ENDED DECEMBER 31, 2014
-58-
Section II Financial Statement Findings:
03-001Noncompliance with OMB Circular A-133
Late Filing of Single Audit Reporting Package
Condition/Criteria:
Under the Single Audit Act of 1996 and OMB Circular A-133, the City was
required to file the Single Audit reporting package by the end of the 9th month
following the end of the fiscal year. This deadline was not met on a timely basis
for the ye ars ended December31, 2003 through 2014.
Cause:
The City experienced difficulties in obtaining the information necessary to
implement GASB Statement No.34, for the years ending December 31, 2003 and
2004, resulting in late completion of financial statements for those years. In
subsequent years, the City has endeavored to reestablish a current time line for
financial reporting.
Recommendation:
We recommend the requirements of OMB Circular A-133 and 2 C.F.R. 200 titled
Uniform Administrative Requirements, Cost Principles, and Audit Requirements
for Federal Awards (Uniform Guidance)be adhered to by striving to have all
information required for the audit available on a timely basis. This will help to
insure timely audit report issuance and compliance with the filing deadline.
Corrective Action Plan:
The completion of the reporting package for the year ending December 31, 2015
is scheduled to be completed in accordance with filing deadlines prescribed by
OMB Circular A-133 and Uniform Guidance.
Questioned Costs: Undeterminable
CITY OF ITHACA
SCHEDULE OF FINDINGS AND QUESTIONED COSTS
FOR THE YEAR ENDED DECEMBER 31, 2014
-59-
10-001 Capital Project Accounting
Condition/Criteria:
Currently, City personnel account for the Capital Fund in spreadsheets and do not
enter information in the City’s financial software system. This creates
opportunities for errors to occur and not be detected by management in a timely
manner. During a prior year audit, we noted discrepancies which resulted in a
restatement to the beginning fund balance in the Capital Fund and beginning net
position in the government-wide financial statements.
Cause:
The City’s financial software system does not have the capability to account for
the numerous capital projects in process.
Recommendation:
We recommend City personnel convert the current accounting process to
incorporate the Capital Fund as a whole into its financial software system and
continue to account for each project in spreadsheets, while pursuing a system that
will provide the functionality desired to appropriately track Capital Fund activity.
Corrective Action Plan:
The City has authorized the installation of the capital project accounting module of
MUNIS, which will be completed during the 2016 fiscal year.
Questioned Costs: Undeterminable
Section III Federal Award Findings and Questioned Costs:
None
- 2 -
Recommendation:
We recommend the requirements of OMB Circular A-133 and 2 C.F.R. 200 titled Uniform Administrative
Requirements, Cost Principles, and Audit Requirements for Federal Awards (Uniform Guidance) be adhered to
by striving to have all information required for the audit available on a timely basis. This will help insure
timely audit report issuance and compliance with the filing deadline.
MATERIAL WEAKNESS
Capital Project Accounting
Finding:
Currently, City personnel account for the Capital Fund in spreadsheets and do not enter information in the City’s
financial software system. This creates opportunities for errors to occur and not be detected by management in a
timely manner.
The City’s financial software system does not have the capability to account for the numerous capital projects in
process. The City authorized the installation of the capital project accounting module of MUNIS, which was to
be completed during the 2013 fiscal year. However, the new module has not yet been implemented.
Recommendation:
We recommended City personnel convert the current accounting process to incorporate the Capital Fund as a
whole into its financial software system and continue to account for each project in spreadsheets, while pursuing
a system that will provide the functionality desired to appropriately track Capital Fund activity.
Current Status:
The City is in process of setting up the chart of accounts for Capital Projects in MUNIS. Full implementation of
the module is expected during the 2016 fiscal year.
OTHER MATTERS
Recurring Comments
Fixed Asset Accounting
Finding:
Currently, City personnel account for fixed assets in spreadsheets rather than the City's financial software
system. This creates greater opportunities for error. Inquiry with management revealed an upgrade to MUNIS
is planned, which will include the fixed asset module.
Recommendation:
We recommend converting the current accounting process to incorporate fixed assets in the financial software
system as soon as feasible.
Physical Inventory of Capital Assets
Finding:
The City has not had a formal physical inventory of capital assets in recent years. The current list was created
using lists provided by each department from the last physical inventory. A current physical inventory is
necessary to ensure records only include assets currently in use. Discussions with City management revealed a
committee of the City Council has been formed to work on this issue.
Recommendation:
We continue to recommend the City perform a physical inventory of all capital assets and update records as
necessary.
Current Status:
No change from previous year.
- 3 -
Purchasing Policy
Finding:
During our prior year audit, City policy was not always followed when making purchases, specifically the use of
purchase orders. The City requires purchase orders for purchases of $250 or more, however, 4 of 16
disbursements tested which required purchase orders did not have them. During our current year audit,
however, purchase orders were present for all items tested.
During the current and prior year audits, we noted the Purchasing Policy had not been updated to reflect the
higher bidding thresholds under General Municipal Law. Inquiry of management revealed the Purchasing Policy
is in the process of being updated; however, the process has proven to be a lengthy one. Having an outdated
policy that does not meet the needs of the City and, therefore, is not enforced could send a message to staff that
it is not important to follow other City policies.
Recommendation:
We recommend the Purchasing Policy be updated as soon as practicable and the updated policy adhered to by all
departments.
Held Checks
Finding:
During the current and prior year audits, a significant number of checks from various City accounts were
written, but not sent to vendors in a timely manner. As a result, these bank accounts showed a large negative
book balance. This practice has the effect of understating both cash and accounts payable balances. Through
inquiry of City personnel, we determined the condition was related to the audit process at year end.
Additionally, blank checks are held in the vault to be backdated if necessary and subsequently destroyed if not
used.
Recommendation:
We continue to recommend procedures be developed and implemented stating checks only be written when
funds are available and with the intention of sending payments timely. City staff has begun meeting to develop
such procedures. We also recommend discontinuing the practice of holding blank checks in the vault for the
purpose of backdating them.
Current Status:
No change from previous year.
This communication is intended solely for the information and use of management, the Common Council, and
others within the City of Ithaca, and is not intended to be and should not be used by anyone other than these
specified parties.
Respectfully Submitted,
Insero & Co. CPAs, LLP
Certified Public Accountants
Ithaca, New York
March 17, 2016
10. PLANNING AND ECONOMIC DEVELOPMENT COMMITTEE:
10.1 Brindley Street Bridge Replacement – Lead Agency Resolution
WHEREAS, the existing Brindley Street Bridge (“the Bridge”) is a single span, single-lane
multiple steel girder bridge carrying Brindley Street over the Cayuga Inlet; and
WHEREAS, Brindley Street Bridge Replacement Project (“the Project”) involves the
replacement of the Brindley Street Bridge with a two lane structure with additional
accommodations for bicyclists and pedestrians including necessary approach and intersection
improvement; and
WHEREAS, two possible alternatives for the replacement of this bridge are being considered:
Bridge Alternative 1, which includes replacement of the bridge in its existing alignment and
Bridge Alternative 2, which would include the construction of new roadway and bridge on a
relocated horizontal alignment that would connect Taber Street with the West State/Martin
Luther King, Jr. Street/Taughannock Boulevard intersection; and
WHEREAS, the alternatives for reconstruction of the Brindley Street Bridge were presented to
the City Planning and Development Board on September 23, 2014; and
WHEREAS, the Planning and Development Board prepared a memo in support of Bridge
Alternative 2, which would realign the bridge with Taughannock Boulevard, stating that this
would improve a problematic intersection; and
WHEREAS, the alternatives for reconstruction of the Brindley Street Bridge were presented to
the City Board of Public Works on September 22, 2014; and
WHEREAS, on October 6, 2014, the Board of Public Works voted on a resolution in support of
Bridge Alternative 2, which would realign the bridge with Taughannock Boulevard; and
WHEREAS, on February 8, 2016, the Board of Public Works voted on a resolution that declared
the Board’s intent to act as a lead agency for environmental review of the project focused on
Alternative 2; now, therefore be it
RESOLVED, That the Common Council hereby accepts the recommendation of both the Board
of Public Works and Planning and Development Board to proceed with developing a detail
design for Brindley Street Bridge Alternative 2; and, be it further
RESOLVED, That the Common Council hereby concurs with Board of Public Works on its
intention to act as a lead agency for the environmental review of the project focused on
Alternative 2; and, be it further
RESOLVED, That, contingent upon environmental review outcome, the Common Council
hereby authorizes the Superintendent of Public Works to proceed with the design of Brindley
Street Bridge replacement on a relocated horizontal alignment and new roadway construction
(Bridge Alternative 2).
10.2 Six-Mile Creek Watershed Conservation Easement – Resolution
WHEREAS, the City of Ithaca has received an application from the Finger Lakes Land
Trust (FLLT) to support the acquisition of approximately 125 acres of land within the Six
Mile Creek Watershed located at 471 Midline Road in the Town of Dryden (“the Petkov
Property”); and
WHEREAS, the application meets the four criteria established in the Common Council
Resolution “City Watershed Conservation Easements Processes” passed on March 4,
2015; and
WHEREAS, the Superintendent of Public Works and Assistant Superintendent of Public
Works—Water and Sewer have reviewed the application and believe that the property is
of high value for protection of the watershed; and
WHEREAS, the Board of Public Works passed a February 22, 2016 resolution
supporting the provision of $40,000 toward acquisition of the Petkov Property by the
FLLT; now, therefore be it
RESOLVED, That the Common Council authorizes the Mayor, on advice of the City
Attorney, to enter into a funding agreement with the FLLT by which the City provides
$25,000 to the FLLT and the FLLT contractually commits to the preservation in
perpetuity of the Petkov Property, thus protecting the water quality of the watershed
flowing into the City’s water filtration plant; and, be it further
RESOLVED, That the Common Council authorizes funding in support of the same to be
drawn from the Water Fund, Watershed Accounts; F8321-5700 $20,000 (2015) and
F8321-5435 $5,000 (2016).
BACK-UP ITEM 10.2
TO: Common Council, Board of Public Works
FROM: JoAnn Cornish, Director of Planning and Development
DATE: February 18, 2016
RE: Request to Contribute to the Purchase of 125-Acre Parcel in the Town of
Dryden as part of the City’s Six Mile Creek Watershed Protection Funding
Commitment
The City has received a request from Andrew Zepp, Director of the Finger Lakes Land Trust (FLLT),
to contribute the existing balance of the City’s watershed protection funding, in the amount of
$40,000, to help in the purchase of a 125-acre parcel in the Town of Dryden as part of the City’s Six
Mile Creek watershed protection funding commitment. The FLLT is proposing to purchase the
property and to manage the site in perpetuity as a nature preserve and plans to launch a $300,000
fundraising campaign for the project. They are also pursuing a grant of $40,000 from the County’s
capital reserve fund in addition to seeking $220,000 in private funding.
The 125-acre parcel borders existing protected land and encompasses more than 900 feet of
frontage on Six Mile Creek, more than two miles of frontage on tributaries to the creek, 12 acres of
wetland, a county-designated Unique Natural Area, and more than 100 acres of mature forest. It is
adjacent to the Roy H. Park Nature Preserve – Baldwin Tract, acquired by the Finger Lakes Land
Trust, that together span 138 acres with more than 4,000 feet of frontage on Six-Mile Creek
(separated from the 125-acres by only one parcel). In addition, the 125-acre parcel is adjacent to
approximately 400 acres of a Cornell Natural Area.
Since the late 1980’s, the City has provided funding for purchasing specific parcels and/or easements
along Six Mile Creek that were chosen to complement the land already owned by the City. Parcels
were identified primarily to protect the City's water supply and as an added bonus, for their proximity
to the South Hill Recreation Way. Several of the desired parcels have frontage on major roads,
(Route 79 and Coddington Road). The thought was for the City to purchase parcels between these
two roads (as they became available), subdivide the parcels, sell the frontage piece, and maintain the
rear parcels as part of the watershed acquisitions. (Thus getting the biggest “bang for our buck”).
CITY OF ITHACA
108 E. Green Street — 3rd Floor Ithaca, New York 14850-5690
DEPARTMENT OF PLANNING, BUILDING, ZONING & ECONOMIC
DEVELOPMENT
JoAnn Cornish, Director of Planning and Development
Phone: 607-274-6550 Fax: 607-274-6559 Email: dgrunder@cityofithaca.org
The proceeds from the sale of the frontages would cover some of the costs the City had incurred
when it purchased the property or was to be put in reserve to pay for other properties as they
became available.
The 125-acre property proposed for purchase is nearly 8 miles from the City’s holdings in Six Mile
Creek. While it is part of the Six Mile Creek watershed, it is not a parcel we have identified for
acquisition. In addition, it is neither a fee title purchase nor a conservation easement, but a
contribution to property that will not be owned by the City but by the FLLT.
Additionally, since the land is a key tract bordering Six Mile Creek that has been identified by the
County Planning Department as one of the highest priority parcels for protection, and is adjacent to
over 500 acres of FLLT and Cornell Natural Areas lands, the likelihood of funding by outside sources
seems promising while the likelihood of development on the parcel does not.
In the adopted resolution, the sixth Resolved states: “that the Board of Public Works deliberate upon, and
thereafter approve or deny, each application for funding of transaction costs of a conservation easement, and
if approved specify the dollar amount, not to exceed $15,000 per application, authorized for use on the
application-specific project to be drawn from the Council-budgeted funds available to this program at that
time, abiding the following minimum criteria, all of which must be satisfied in support of any approved
application:
1. The property owner(s) of the property impacted by the pending application is/are
willing participant(s) in the project.
The Land Trust has negotiated an agreement to purchase 125 acres from the
Petkov family for $250,000, leaving them with 15 acres along with their single
family home. This is less than the proposed acquisition’s appraised value of
$288,000.
2. An outside funding match to City's contribution to the application-specific project is
preferred, but not required.
A $300,000 fundraising campaign has been launched by the FLLT to cover
the purchase price, associated transaction costs, and a contribution to the
organization’s Stewardship Fund to provide for long term management and
monitoring.
While it is anticipated that the majority of the funds for the project will come
from private individuals, the Land Trust is also seeking grants from the City of
Ithaca ($40,000 and from Tompkins County’s Capital Reserve Fund for
Natural, Scenic and Recreational Resource Protection ($40,000).
3. Another party will be responsible for property management and stewardship of any
conservation easement created under this program.
This is not a conservation easement nor a fee title purchase, but a donation to
the FLLT, who will own and retain the property as a nature preserve – to be
managed in conjunction with its nearby Roy H. Park Preserve.
4. The project is located in the City watershed and the conservation of the project is
deemed by the Board of Public Works, on the advice of relevant City staff, to be
beneficial to long-term water quality for the City's water supply.
The property is located in the Six Mile Creek Watershed and will be beneficial to
long-term water quality for the City’s water supply.
After evaluation of this request, and in accordance with the criteria specified above, it is my
recommendation that the City match the contribution of the County, recently approved, in the
amount of $25,000 to contribute to the sale price of the subject property. This will leave some funds
in reserve should we have an opportunity to purchase one of the parcels identified by the City as a
priority acquisition.
Below is a map showing the properties proposed for acquisition in both the City and the Town
in order of priority.
SIX MILE CREEK CORRIDOR PROTECTION PROJECT
FINGER LAKES LAND TRUST
The Finger Lakes Land Trust seeks an allocation of $40,000 from the City of Ithaca’s Six Mile Creek
Watershed Protection Fund to support the acquisition of approximately 125 acres of environmentally
sensitive watershed lands located on Midline Road in the Town of Dryden.
The proposed acquisition features more than 900 feet of frontage on Six Mile Creek and more than two
miles of frontage on perennial tributaries to the creek. The tract also features 12 acres of wetlands that
filter runoff as well as several springs that contribute clean water to the creek. Due to these attributes, this
property plays an important role in helping to maintain the quality of Ithaca’s drinking water supply.
The proposed acquisition is also located within a growing network of conserved lands that includes the
Land Trust’s Roy H. Park Preserve, Cornell University’s Old 600 Natural Area, Hammond Hill State
Forest, and Yellow Barn State Forest.
The site encompasses the entirety of county Unique Natural Area #118 – the Dryden-Slaterville Fir Tree
Swamp as well as a portion of county Unique Natural Area #117 – the Slaterville Wildflower Preserve. It
is also located within a “Natural Resource Focus Area” identified in Tompkins County’s comprehensive
plan.
The Land Trust has negotiated an agreement to purchase 125 acres from the Petkov family for $250,000 –
leaving them with 15 acres along with their single family home. This is less than the proposed
acquisition’s appraised value of $288,000.
The Land Trust intends to retain the property as a nature preserve – to be managed in conjunction with its
nearby Roy H. Park Preserve. A $300,000 fundraising campaign has been launched to cover the purchase
price, associated transaction costs, and a contribution to the organization’s Stewardship Fund to provide
for long term management and monitoring.
While it is anticipated that the majority of funds for the project will come from private individuals, the
Land Trust is also seeking grants from the City of Ithaca and from Tompkins County’s Capital Reserve
Fund for Natural, Scenic and Recreational Resource Protection.
Acquisition of this land will and its management as a nature preserve will provide the highest degree of
protection for Six Mile Creek and the City of Ithaca’s drinking water supply. Completion of this project
will ensure that this pristine property will continue to provide clean water while filtering runoff and
retaining storm water during times of high runoff.
The purchase contract calls for a closing in mid-April. At this time, the Land Trust will need to provide
half of the total purchase price. The second half will be due in December 2016.
The Finger Lakes Land Trust is a non-profit conservation organization that works cooperatively with
landowners and local communities to conserve those lands that are vital to the integrity of the region.
Since it was established in 1989, the Land Trust has protected more than 18,000 acres of significant open
space, including more than 1,000 acres within the Six Mile Creek Watershed. The organization today
owns and manages 36 conservation areas that are open to the public and holds more than 100
conservation easements on land that remains in private ownership. Additional information may be found
at www.fllt.org.
S
i
x
M
i
l
e
C
r
e
e
k
S
i
x
M
i
l
e
C
r
e
e
k
Mid
l
i
n
e
R
d
[0 1,000500 Feet Map prepared by Karen Edelstein,
Finger Lakes Land Trust
15 December 2015
Petkov, potential acquisition
Petkov property, excluded
Streams
Cornell Natural Area
FLLT preserves
to
m
p
k
i
n
s
_
2
0
1
2
Property of Marilyn and Theodore Petkov
Portion of parcel #76.-1-24.114, 126 acres
471 Midline Rd
Town of Dryden, Tompkins County, NY
April 2012 natural color aerial orthoimagery
£¤79
£¤38
£¤13£¤366
£¤392
Town of
Dryden
Town of
Caroline
Town of
Richford
Town of
Harford
Town of
Virgil
[Map prepared by Karen Edelstein,
Finger Lakes Land Trust
15 December 2015
Petkov property
to
m
p
k
i
n
s
_
2
0
1
2
Property of Marilyn and Theodore Petkov
Conservation context
471 Midline Rd
Town of Dryden, Tompkins County, NY
Petkov, potential acquisition
Cornell Natural Area
FLLT preserves
FLLT CEs
State land
Six Mile Creek watershed
0 21 Miles
10.2 City Watershed Conservation Easements Processes – Resolution
WHEREAS, a conservation easement is asetof legalrestrictionsthat a propertyowner can
voluntarily place on her or his ownland, limitinguse anddevelopment of the landforevermore;
and
WHEREAS, the City is currentlyconstructing at substantial expense a newwaterfiltration plant
which is fed by a creek; and
WHEREAS, the quality of thewater fed by saidcreek is substantiallydependent onthe quality
of water providedupstream of theplant by the creek’s watershed, predominantly outsideCity
limits; and
WHEREAS, overdevelopment ofthe watershed in the long term would increasethe risk of water
quality issues that couldprovecostly to remedy atthe plantitself; and
WHEREAS, the CommonCouncilincluded in the FiscalYear2015 budget $20,000 in support of
the initiativedetailedinthis resolution; and
WHEREAS, the CommonCouncil desires to establish via this resolution morespecific
procedures and guidelines for thedisbursement of thesefundsand any futurefunds similarly
budgeted for the purpose of watershed conservationeasements; now, therefore be it
RESOLVED, Thatas part ofthe annualbudgetproposal ofthe Department of PublicWorks for
the Waterand SewerDivision, the Superintendent of PublicWorks, on consultation withthe
Director of Planning, Building, ZoningandEconomic Development, makea recommendation as
to what amount, if any, is recommended for inclusion intheir annualbudget for purposes ofthis
program; and be it further
RESOLVED, That any fundssobudgeted be evaluated for expenditure on transactioncosts
necessary tothe creation of conservationeasementsaccording to the proceduresand
requirements setout in thisresolution, and such other procedures and requirements not in
conflict with this resolution establishedby the Director of Planning, Building, Zoningand
Economic Development and theSuperintendent of Public Works; and, be it further
RESOLVED, That applications for expenditure of thesefunds on particularconservation
easementprojects maybe submittedby any member of thepublic, thoughmostcommonlyby
the Finger LakesLandTrust, tothe Director of Planning, Building, ZoningandEconomic
Developmentorher/his designee; and, be it further
RESOLVED, That the Director of Planning, Building, Zoning and Economic Development or
her/his designee shall evaluate each applicationaccording to the minimumcriteriaspecified in
this resolution, amongothers, and if saidminimum criteria aresatisfied, shall circulate the
application tothe Superintendent of PublicWorks or his/her designee (expectedgenerally to
includeeither or both ofthe City WatershedCoordinatorandthe City EnvironmentalEngineer),
who in turnshall:
add theapplication toan upcomingagenda ofthe Board of PublicWorks occurringnot
soonerthan30 days in thefuture, and
email or mail notice ofthe application toall members of the City’s CommonCounciland
to the Clerk of the Town or Villagein whichthecontemplatedconservation easement
would be created;
and, be it further
RESOLVED, That the Director of Planning, Building, Zoning and Economic Development, the
Superintendent of PublicWorks, and/or each of their designees make a recommendation to the
Board of PublicWorksas to their recommended action on the applicationunderconsideration;
and, be it further
RESOLVED, That the Board of Public Worksdeliberate upon, and thereafter approve or deny,
each application for funding of transaction costs of a conservationeasement, and if approved
specify the dollaramount, notto exceed $15,000perapplication, authorizedfor useonthe
application-specific project tobe drawn from the Council-budgetedfundsavailable to this
program at that time, abiding the following minimumcriteria, allof which must be satisfied in
support of anyapproved application:
1. The property owner(s) ofthe propertyimpacted by the pendingapplication is/are willing
participant(s) in the project;
2. An outside funding match to City's contribution tothe application-specificproject is
preferred, but notrequired;
3. Anotherparty willbe responsible for propertymanagementandstewardship of any
conservationeasementcreatedunder this program;
4. Theproject is locatedin the watershed of SixMileCreekupstream of the current
location ofthe sixty-foot dam, andthe conservation of theproject is deemed by the Board of
PublicWorks, onthe advice of relevant Citystaff, to be beneficial tolong-term waterquality for
theCity's watersupply;
And, be it further
RESOLVED, Thatapplicationsmay be submittedseeking funding support of this program for
fee-title purchases (rather than easements) in support of conservation of the City watershed, but
that suchapplicationsshall, after being considered by the Board of PublicWorksasspecifiedin
this resolution, require avote of CommonCouncilbefore any approval ofthe applicationshall
be effective.
Six Mile Creek Watershed Conservation Easement—Resolution, as unanimously passed at 2/22/16 BPW
WHEREAS, the City of Ithaca has received an application from the Finger Lakes Land Trust to support the
acquisition of approximately 125 acres of land within the Six Mile Creek Watershed located at 471
Midline Road in the Town of Dryden (known as the Petkov Property), and
WHEREAS, the application meets the four criteria established in the Common Council Resolution “City
Watershed Conservation Easements Processes” passed on March 4, 2015, and
WHEREAS, the Superintendent of Public Works and Assistant Superintendent of Public Works—Water
and Sewer have reviewed the application and believe that the property is of high value for protection of
the watershed, now therefore be it
RESOLVED, that the Board of Public Works supports a grant of $40,000 toward acquisition of the Petkov
Property by the Finger Lakes Land Trust, and be it further
RESOLVED, that the Board of Public Works directs the Superintendent of Public Works to place the
application on the upcoming agenda of the Planning and Economic Development Committee.
1
Aaron Lavine
From:Aaron Lavine
Sent:Friday, February 19, 2016 3:11 PM
To:Kathy Servoss; Board of Public Works
Cc:JoAnn Cornish
Subject:RE: Six Mile Creek Conservation Easement
Thank you, JoAnn, for this constructive input. For BPW’s reference, I want to add two minor clarifications:
1. As you note, the March 2015 authorizing resolution for this program ends by setting out a procedure for
considering “fee-title purchases (rather than easements)”. While the resolution could have been clearer, I
believe it was authorizing the sort of fee-title purchase now before us: a fee-title purchase by an entity (here,
the Land Trust) that will preserve the parcel of land in perpetuity, just as the City wouldn’t take title to
conservation easements purchased under this program either, but would also entrust those to titling in the Land
Trust’s name.
2. I can certainly see the logic in your suggestion that the City authorize $25,000 for this transaction rather than
$40,000, and I really don’t think there’s a right and a wrong answer. I will note that to the extent that our
motivation in picking a smaller number is to preserve funds for future watershed protection transactions, it’s
worth keeping in mind that (so far) Council has funded this program at $20,000 per year out of the water
fund. Thus, it’s a decent bet that some funding will be available to future transactions—which are in any event
not available to us at this time—even if we devote the full $40,000 to this project now. Either way, these sums
of money are a true drop in the proverbial bucket of $30+ million that we are spending on our new water plant,
which will do us little good without high quality water for many decades to come.
Thanks again, and have a good weekend.
Ari
Aaron (Ari) O. Lavine
City Attorney, City of Ithaca
108 E. Green St.
Ithaca, NY 14850
Tel: (607) 274-6504
Fax: (607) 274-6507
This e-mail contains information that may be privileged and confidential. If you are not the intended recipient, please
delete this e-mail and notify us immediately by reply email, or at (607) 274-6504.
From: Kathy Servoss
Sent: Friday, February 19, 2016 2:25 PM
To: Board of Public Works <BPW@cityofithaca.org>
Subject: FW: Six Mile Creek Conservation Easement
Additional information for the agenda.
- Kathy Servoss
Executive Assistant
Supt. of Public Works, Engineering, & Parking
City of Ithaca
108 E. Green St.
10.3 An Ordinance to Amend the City of Ithaca Municipal Code, Chapter 325,
Entitled “Zoning,” Article IV, Section 325-12, in Order to Amend the Approval
Process for the Planned Unit Development (PUD)
ORDINANCE NO. 2016-____
BE IT ORDAINED AND ENACTED by the Common Council of the City of Ithaca that
Chapter 325, Article IV, Section 325-12G.(12) be amended as follows:
Section 1. Chapter 325 (“Zoning”), Article IV, section 325-12G.(12) is hereby amended
to change the approval process for a Planned Unit Development Zone to allow the
Common Council to approve a PUD for a multi phased project based on the final site
plan approval of the first phase of the project and preliminary site plan approval of
subsequent phases of the project, and shall read as follows:
§325-12. G.(12)
“Common Council consideration of the PUD. When and if the Planning and
Development Board has completed its environmental review of the project to the extent
required under SEQRA and CEQRO and has issued a contingent site plan approval or
in the case of a multi-phase project has issued a preliminary contingent site plan
approval of multiple phases along with a final contingent site plan approval of at
least one phase, the project will return to the Common Council for final consideration of
the adoption of the PUD, which at Council’s discretion may be authorized for one
or all phases of a multi-phase project. Final Council approval, if any, shall be granted
via ordinance.”
Section 2. Severability. If any section, subsection, sentence, clause, phrase or portion
of this ordinance is held to be invalid or unconstitutional by a court of competent
jurisdiction, then that decision shall not affect the validity of the remaining portions of
this ordinance.
Section 3. Effective date. This ordinance shall take effect immediately and in
accordance with law upon publication of notices as provided in the Ithaca City Charter.
14. MAYOR’S APPOINTMENTS:
14.1 Appointments to City of Ithaca Local Board of Assessment Review -
Resolution
RESOLVED, That Marjorie Olds, Linda Santos, and William Goldsmith be appointed to
the Local Advisory Board of Assessment Review for the City of Ithaca for 2016.
14.2 Appointment to the Program Oversight Committee (POC) for the
Community Housing Development Fund
RESOLVED, That Ducson Nguyen be appointed to the Program Oversight Committee
for the Community Housing Development Fund; and, be it further
RESOLVED, That J.R. Clairborne’s appointment be modified to an alternate member to
the Program Oversight Committee for the Community Housing Development Fund.
14.3 Appointment to Planning and Development Board – Resolution
RESOLVED, That Matthew F. Johnston be appointed to the Planning and Development
Board to replace C.J. Randall with a term to expire December 31, 2018.
14.4 Appointment to Shade Tree Advisory Committee – Resolution
RESOLVED, That Beverly Brink Hillman be appointed to the Shade Tree Advisory
Committee to fill a vacancy with a term to expire December 31, 2018.