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HomeMy WebLinkAbout2025 CDA_. _. - .. 'Y•...sv v. •� :a�_r��. yr -f a �7 • � C a AGENCY CHARTER AND STATUTORY COMPLIANCE The Chubbuck Development Authority (CDA) was officially created on April 14, 1992, by Resolution No. 4-92 of the Chubbuck City Council. Its purpose is to eliminate slum and blight and deteriorated or deteriorating conditions within the City of Chubbuck. This report is in accordance with Idaho Code Section 50-2006(c) which states that: An agency authorized to transact business and exercise powers under this chapter shall file, with the local governing body, on or before March 31 of each year a report of its activities for the preceding calendaryear, which reportshall include a complete financial statement setting forth its assets, liabilities, income and operating expense as of the end of such calendar year. The agency shall be required to hold a public meeting to report these findings and take comments from the public. At the time of filing the report, the agency shall publish in a newspaper of general circulation in the community a notice to the effect that such report has been filed with the municipality and that the report is available for inspection during business hours in the office of the city clerk or county recorder and in the office of the agency. By virtue of certain amendments to the Idaho Urban Renewal Law adopted in 2002, the fiscal year of an urban renewal agency has been established as October 01 through September 30. Consequently, any formal financial statement is limited to a report through the end of the CDA's fiscal year. Under the Idaho Urban Renewal Law, Chapter 20, Title 50, Idaho Code, an urban renewal agency is required to file with the local governing body and the Idaho State Controller, on or before March 31 of each year, a report of its activities for the preceding calendar year, which shall include certain financial data and audit reports as set forth in Idaho Code Sections 67- 1075 and 67-1076. ACKNOWLEGEMENTS To fulfill its purpose the CDA works with many other agencies, state and local elected officials, real estate developers, jurisdictions including the County, City of Chubbuck, and the state and private and nonprofit organizations and is grateful for the support and efforts of each. The CDA is grateful for the support from the taxing districts affected by the CDA's urban renewal areas as all seek to preserve the tax base in these areas in attempt to minimize property tax rates for the community as a whole. Finally, and most of all, the CDA appreciates those businesses and property owners who strive to grow their businesses, maintain their properties, and promote development in the City of Chubbuck since without them, efforts of the Chubbuck Development Authority would be greatly minimized. 1 ORGANIZATION The Chubbuck Development Authority consists of seven (7) commissioner seats, with seats being filled with appointments to varying terms by the Chubbuck City Council. Commissioners and Staff are: Name Term Expiration Date Rick Keller October 2026 Jeff Hough October 2026 Krystal Denney October 2027 Dan Heiner October 2028 Amanda James October 2028 Derek Toone October 2029 Brandon DesFosses October 2029 Also serving with the CDA are: ❑ Ashley Squyres, Executive Director ❑ TJ Budge, Racine Olson, Legal Counsel ❑ Jordan & Company, Bookkeeper (Through October 2025) ❑ Clifton Larsen Allen, Accounting Firm (Beginning in October 2025) ❑ Joey Bowers, Clerk & Secretary CDA Board Leadership: Dan Heiner: Chairman Amanda James: Vice -Chairwoman RESOLUTIONS The Chubbuck Development Authority passed the following resolutions in Calendar Year 2025: Resolution 2025-1 passed on May 20, 2025, accepting the eligibility report for the new proposed revenue allocation area and directing the urban renewal agency to transmit the report to the City Council. 2 Resolution 2025-2 passed on August 19, 2025, approving the urban renewal plan for the Yellowstone Corridor district. Resolution 2025-3 passed on August 19, 2025, approving the Fiscal Year 2026 budget. Resolution 2025-4 passed on September 16, 2025, approving the amended Fiscal Year 2025 budget. FINANCIAL INFORMATION PER I.C. 67-1072(2)(B), (C) In accordance with Idaho Code section 67-1076(2)(b), (c), the following are included as attachments to this report: 1. FY2025 Amended Budget 2. FY2024 Audit URBAN RENEWAL DISTRICTS Pine Ridge Urban Renewal Plan (est. 2016 ) The Pine Ridge Urban Renewal Plan was adopted by the Chubbuck City Council via Ordinance Number 759 on August 03, 2016. The future revenue and expenditures of the Pine Ridge Urban Renewal Plan will be administered by CDA under an owner participation agreement and annual activities are included in this report. 2016 to 2036 Projects - Revenue Allocation Bond (2020) The approved Pine Ridge plan establishes what improvement projects are eligible for CDA participation. The Plan also predicts tax increment revenue generated by Plan improvements. Under the 2016 agreement, CDA and the City of Chubbuck agreed to reimburse Pine Ridge ownership 100% of increment revenue less administrative cost which shall not exceed $15,000. In October 2020, however, the CDA closed on a revenue allocation bond in the amount of $1,940,000 at a discount of $50,000 at the request of the Pine Ridge Mall developer. The bond carries an interest rate of 6.750% and a maturity date of November 01, 2037. The bond is being used to provide monies to reimburse the developer for already completed eligible costs and thereby provides more capital for further investment in the development in the Pine Ridge Mall urban renewal district. Whereas prior to the bond sale, 100% of the increment revenues, less administrative 3 costs, were owed to the developer for eligible improvements, now 100% of the increment, excluding the CDA's administrative costs, is dedicated to the bond commitment until repaid. Due to the additional administrative staff time with the bond proceeds, the developer agreed to a $15,000 administrative fee in 2024 and the administrative fee was transferred to the CDA General Fund in 2024. The Pine Ridge District generated $194,174.31 in tax increment revenues and interest earnings during calendar year 2025. Future Needs/Plans Moving into 2026, the CDA will continue to pay its bond obligations as required. The CDA is optimistic about continued development in this district and looks forward to the year to come. Northside Crossing Urban Renewal Plan (est. 2020) The Northside Crossing Urban Renewal Plan was adopted by the Chubbuck City Council via Ordinance Number 819 on November 04, 2020 and was accepted by the State Tax Commission on December 07, 2020. The future revenue and expenditures of the Northside Crossing Urban Renewal Plan will be administered by CDA under the terms of the Plan and through further owner participation agreements. In 2021, the CDA and developer executed an owner participation agreement establishing qualified reimbursement terms and processes. Several improvements that were approved as part of the Plan have already been completed. Development progress in the district is occurring rapidly, although it was less rapidly in 2024 than in previous years, likely due to increased interest rates. In calendar year 2025, the CDA received approximately $242,686.54 in property tax increment revenue and the CDA reimbursed the Developer in the amount of $179,218.15 in accordance with the executed Owner Participation Agreement between the CDA and the Developer. Future Needs/Plans Moving into 2026, the CDA will continue to review and approve qualified expense reimbursement requests in accordance with the Owner Participation Agreement. The CDA is optimistic about continued development in this district and looks forward to the year to come. F Harvest UrinCas Urban Renewal Plan (est. 2021 The Harvest Springs Urban Renewal Plan was adopted by the Chubbuck City Council via Ordinance Number 840 on November 03, 2021 and was accepted by the State Tax Commission on November 18, 2021. The future revenue and expenditures of the Harvest Springs Urban Renewal Plan will be administered by CDA under the terms of the Plan and through further owner participation agreements. In 2022, an owner participation agreement was formalized to agree to qualified reimbursement terms with the Developer. Several improvements that were approved as part of the Plan have already been completed and development progress in the district is occurring rapidly with some certificates of occupancy having been issued. In calendar year 2025, the CDA received $46,815.31 in property tax increment revenue and the CDA reimbursed the Developer in the amount of $25,409.50 in accordance with the executed Owner Participation Agreement between the CDA and the Developer. Yellowstone Corridor Urban Renewal Plan (est. 20255 In response to the sunset of the 1992 Urban Renewal District in the early 2020s, the Chubbuck Development Authority (CDA) and City Council identified a need for continued investment in the Yellowstone Corridor area. In 2024, the Urban Land Institute convened a Technical Assistance Panel composed of experts in real estate, development, and finance to evaluate opportunities within the corridor. In October 2024, the panel presented its findings and recommendations to the CDA, City Council, and community stakeholders. Based on these recommendations, the CDA and the City initiated the process to establish a new urban renewal district. Throughout the spring and summer of 2025, the CDA worked in coordination with a consultant and the City Council to complete the statutory requirements for district formation. The Yellowstone Urban Renewal Plan was formally adopted by the CDA Board on August 19, 2025, and subsequently approved by the Chubbuck City Council through Ordinance No. 883 on October 15, 2025. The Project Area encompasses approximately 389 -acres along the Yellowstone Highway Corridor, extending between New Day Parkway/Siphon Road and I-86. The area includes a diverse mix of land uses, including commercial, residential, industrial, and agricultural zoning, and contains a combination of developed properties, underutilized parcels, and vacant land positioned for redevelopment. 5 Despite its strategic location, the Project Area is currently constrained by several significant infrastructure and site deficiencies. Public infrastructure, including roadways, sidewalks, and curbs, is deteriorated or incomplete in many locations, and the existing street network lacks adequate connectivity to support efficient vehicular, pedestrian, and bicycle movement. In addition, portions of the water and wastewater systems are undersized or outdated, limiting the area's capacity to support future growth and development. These conditions, combined with outdated lot configurations, fragmented ownership patterns, and the presence of aging or obsolete structures, have resulted in underutilization of land and constrained the area's ability to achieve its highest and best use. As a result, the Project Area has not fully contributed to the City's economic vitality and growth objectives. Planned Improvements and Redevelopment Strategy The Plan is designed to address these deficiencies through targeted public investment in infrastructure and publicly owned assets. Planned improvements include roadway reconstruction, enhanced pedestrian and bicycle connectivity, and upgrades to water and wastewater systems. These investments are intended to create a development -ready environment that supports a range of uses, including commercial, office, retail, industrial, and multi -family residential development, consistent with the City's Comprehensive Plan. Financing and Implementation Implementation of the Plan is supported through revenue allocation financing. This mechanism allows incremental property tax revenues generated by new development within the Project Area to be reinvested into public infrastructure and related improvements. This approach provides a critical funding source to address existing deficiencies and facilitate redevelopment that would not otherwise be feasible due to the high cost of infrastructure investment. Anticipated Outcomes Through the coordinated investment of public resources, the Plan is expected to: • Stimulate private investment and redevelopment. • Expand housing opportunities across a range of income levels. • Support job creation and economic activity. • Enhance connectivity, safety, and overall livability within the area. • Increase the City's tax base, providing long-term fiscal benefits. The Project Area represents a significant opportunity for strategic reinvestment and growth. By addressing longstanding infrastructure deficiencies and enabling new development, the Plan positions the area to become a more vibrant, connected, and economically productive part of the community. 6 Properties in the District Owned by the CDA In 2018-2019, the CDA purchased several properties deemed blighted and in need of redevelopment under the urban renewal plan to redevelop the properties in the newly identified downtown or city center of the city of Chubbuck. As planned, in Spring 2022 the City adopted a downtown plan and associated zoning code for the downtown area, named Chubbuck Village, and the CDA commenced with the disposal process for all properties as required by Idaho law. No complete responses were received, however, and the CDA decided to wait until calendar year 2023 to attempt again to dispose of the properties with adjusted response standards in hopes of gaining more developer interest. In 2023, the CDA commenced the statutory disposal process for its properties. Multiple responses were provided to the request for proposals and the CDA selected preferred developers with whom to proceed. As part of the disposition process, the CDA deeded two (2) properties adjacent to City Hall to the City of Chubbuck to be used as parks/open space; in 2023, the City constructed improvements on the adjacent property west of City Hall with picnic tables, benches, and cornhole pedestals. Properties owned by the CDA at the end of 2025 include: • 339 East Chubbuck Rd: In 2023, an Agreement to Negotiate Exclusively and a Development Disposition Agreement were signed with the preferred developer, and a Fair Reuse Appraisal was obtained. Unfortunately, on January 07, 2024, a fire destroyed the property's building and the CDA has determined that it must commence anew with the disposal process outlined by Idaho Code. It is anticipated that the CDA will undergo a new process in 2026. • Chubbuck City Hall Subdivision Lot; In 2023, an Agreement to Negotiate Exclusively was signed with the preferred developer and the CDA contracted to have a Fair Reuse Appraisal completed. An appraisal was completed; however, in 2024, the preferred developer has chosen not to pursue a project at this time. It is anticipated that the CDA will undergo a new process in 2026. CDA properties transferred during 2025: • 211 East Linden, 208 Evans, 206 Evans, 162 Evans, 152 Evans, 140 Evans: In 2023, an Agreement to Negotiate Exclusively was signed with the preferred developer and the CDA contracted to have a Fair Reuse Appraisal completed, which was received in December 2023. The CDA worked continuously with the developer throughout 2024 and early 2025 to meet the negotiated conditions of approval of a property transfer. The CDA closed on the property transfer in early 2025. 7 CONCLUSION The Chubbuck Development Authority (CDA) continues to fulfill its charter through projects within its urban renewal districts and has been successful to date in addressing conditions of slum and blight and promotion of economic development. The CDA remains confident that this work will continue for decades, enhancing properties throughout the City of Chubbuck for the benefit of businesses, residents, and visitors. The CDA is in a fiscally sound position to sustain these efforts and will continue to partner with developers and public agencies to support ongoing improvement in the area. Attachments: Fiscal Year 2025 Budget & Fiscal Year 2024 Audit Deaton & Company, Chartered Certified Public Accountants 215 North 9th, Suite A Pocatello, ID 83201-5278 (208)232-5825 Members cf the Idaho Society of Certified Public Accountants Members of the American Institute of Certified Public Accountants March 10, 2025 Board of Commissioners Chubbuck Development Authority PO Box 5604 Chubbuck, Idaho 83202 We have audited the financial statements of the governmental activities, each major fund, and the aggregate remaining fund information of Chubbuck Development Authority for the year ended September 30, 2024. Professional standards require that we provide you with information about our responsibilities under generally accepted auditing standards (and, if applicable, Government Auditing Standards and the Uniform Guidance), 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 October 29, 2024. 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 Chubbuck Development Authority 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 2024. We noted no transactions entered into by Chubbuck Development Authority 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 authority had no estimates reported during the year. The financial statement disclosures are neutral, consistent, and clear. Difficulties Encountered in Performing the Audit We encountered no significant difficulties in dealing with management in performing and completing our audit. Corrected and Uncorrected Misstatement Professional standards require us to accumulate all known and likely misstatements identified during the audit, other than those that are clearly 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 each opinion unit's financial statements taken as a whole. Disagreements with Management For purposes of this letter, a disagreement with management is 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 10, 2025. 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 Chubbuck Development Authority'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 Findings 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 Chubbuck Development Authority'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 the schedules of budget and actual, 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. Restriction on Use This information is intended solely for the information and use of Board of Commissioners and management of Chubbuck Development Authority and is not intended to be, and should not be, used by anyone other than these specified parties. Very truly yours, Pocatello, ID CHUBBUCK DEVELOPMENT AUTHORITY STATEMENT OF NET POSITION SEPTEMBER 30, 2024 WITH COMPARATIVE TOTALS AT SEPTEMBER 30, 2023 ASSETS Current assets Cash and cash equivalents Prepaid expense Property tax receivable Restricted cash Noncurrent assets Non -depreciable capital assets LIABILITIES Current liabilities Accounts payable Current portion of bond payable Noncurrent liabilities Bond payable NET POSITION Restricted for districts Unrestricted Governmental Activities 2024 2023 $ 653,906 $ 2,382,566 4,312 3,593 19,345 16,706 129,028 142,384 806,591 2,545,249 1,260,321 1,260,321 1,260,321 1,260,321 2,066,912 3,805,570 381 2,127 58,781 56,198 59,162 58,325 1,144,102 1,292,891 1,144,102 1,292,891 1,203,264 1,351,216 562,031 2,368,237 301,617 86,117 $ 863,648 $ 2,454,354 The accompanying notes are an integral part of these financial statements 6 CHUBBUCK DEVELOPMENT AUTHORITY STATEMENT OF ACTIVITIES FOR THE YEAR ENDED SEPTEMBER 30, 2024 WITH COMPARATIVE TOTALS FOR THE YEAR ENDED SEPTEMBER 30, 2023 EXPENSES General government Chubbuck Urban Renewal District Pine Ridge Mall Urban Renewal District Northside Urban Renewal District Harvest Springs Urban Renewal District NET(EXPENSES)/REVENUE GENERAL REVENUE Property taxes Interest Service and contract revenue Other CHANGE IN NET POSITION BEGINNING NET POSITION ENDING NET POSITION Governmental Activities 2024 2023 $ 44,797 1,679,709 97,709 419,004 $ 44,924 1,620,647 109,347 28,110 2,241,219 1,803,028 (2,241,219) 491,759 40,753 118,000 650,512 (1,590,707) 2,454,354 $ 863,648 (1,803,028) 2,722,800 50,894 5,000 27,074 2,805,768 1,002,740 1,451,614 $ 2,454,354 The accompanying notes are an integral part of these financial statements 7 Amounts reported for governmental activities in the statements of net position are different because: Capital assets used in governmental activities are not financial resources and therefore, are not reported in the funds, net of accumulated depreciation of $0. Certain receivables are not current resources and are reported as deferred revenues in the governmental funds Long-term liabilities are not due and payable in the current period and therefore, are not reported in the governmental funds: Bond payable Net Position of Governmental Activities The accompanying notes are an integral part of these financial statements 8 1,260,321 1,260, 321 19,345 16,706 (1,202,883) (1,349,089) $ 863,648 $ 2,454,354 CHUBBUCK DEVELOPMENT AUTHORITY BALANCE SHEET GOVERNMENTALFUNDS SEPTEMBER 30, 2024 WITH COMPARATIVE TOTALS AT SEPTEMBER 30, 2023 Nonmajor Chubbuck Pine Ridge Mall Northside Harvest Springs General Urban Renewal Urban Renewal Urban Renewal Urban Renewal Fund District Fund District Fund District Fund District Fund 2024 2023 ASSETS Cash and cash equivalents $ 220,903 $ 391,101 $ (15) $ 6,424 $ 35,493 $ 653,906 $ 2,382,566 Prepaid expense 4,312 - - - - 4,312 3,593 Property tax receivable - 3,294 - 16,051 19,345 16,706 Restricted cash 25 - 129,003 - - 129,028 142,384 TOTAL ASSETS $ 225,240 $ 394,395 $ 128,988 $ 22,475 $ 35,493 $ 806,591 $ 2,545,249 LIABILITIES Accounts payable $ 381 $ - $ - $ - $ - $ 381 $ 2,127 Grant payable - - - - - Deferred tax revenues - 3,294 16,051 19,345 16,706 381 3,294 - 16,051 - 19,726 18,833 FUND BALANCES Restricted 25 391,101 128,988 6,424 35,493 562,031 2,368,237 Committed - - - - - - - Unassigned 224,834 - - - - 224,834 158,179 224,859 391,101 128,988 $ 6,424 $ 35,493 $ 786,865 $ 2,526,416 TOTAL LIABILITIES & FUND BALANCES $ 225,240 $ 394,395 $ 128,988 $ 22,475 $ 35,493 $ 806,591 $ 2,545,249 Amounts reported for governmental activities in the statements of net position are different because: Capital assets used in governmental activities are not financial resources and therefore, are not reported in the funds, net of accumulated depreciation of $0. Certain receivables are not current resources and are reported as deferred revenues in the governmental funds Long-term liabilities are not due and payable in the current period and therefore, are not reported in the governmental funds: Bond payable Net Position of Governmental Activities The accompanying notes are an integral part of these financial statements 8 1,260,321 1,260, 321 19,345 16,706 (1,202,883) (1,349,089) $ 863,648 $ 2,454,354 EXPENDITURES Administration Construction Professional services Other expenses Debt services Principal Interest and fiscal charges Return of surplus funds 14,525 - 17,540 60,138 92,203 134,595 - 736,445 - 419,004 1,155,449 1,254,407 24,000 20,850 - 44,850 26,265 6,272 7,500 13,772 35,834 149,000 149,000 191,000 - 92,374 92,374 104,052 - 914,914 - 914,914 44,797 1,679,709 258,914 479,142 2,462,562 1,746,153 EXCESS OF REVENUES OVER CHUBBUCK DEVELOPMENT AUTHORITY (UNDER) EXPENDITURES 66,662 (1,561,277) (13,378) (250,553) STATEMENT OF REVENUES, EXPENDITURES, AND CHANGES IN FUND BALANCES 1,167,762 NET CHANGE IN FUND BALANCE 66,662 (1,561,277) (13,378) (250,553) 18,995 (1,739,551) GOVERNMENTAL FUNDS BEGINNING FUND BALANCE 158,197 1,952,378 142,366 256,977 16,498 2,526,416 1,358,654 FOR THE YEAR ENDED SEPTEMBER 30, 2024 6,424 $ 35,493 $ 786,865 $ 2,526,416 WITH COMPARATIVE TOTALS FOR THE YEAR ENDED SEPTEMBER 30, 2023 $ (1,739,551) $ 1,167,762 Nonmajor Chubbuck Pine Ridge Mail Northside Harvest Springs General Urban Renewal Urban Renewal Urban Renewal Urban Renewal Fund District Fund District Fund District Fund District Fund 2024 2023 REVENUES Property taxes $ 7 $ 432 $ 241,097 $ 228,589 $ 18,995 $ 489,120 $ 2,713,824 Administration 75,138 - - - - 75,138 117,123 Interest revenue 36,314 - 4,439 40,753 50,894 Other revenue - 118,000 - 118,000 27,074 Service and contract revenue 5,000 111,459 118,432 245,536 228,589 18,995 723,011 2,913,915 EXPENDITURES Administration Construction Professional services Other expenses Debt services Principal Interest and fiscal charges Return of surplus funds 14,525 - 17,540 60,138 92,203 134,595 - 736,445 - 419,004 1,155,449 1,254,407 24,000 20,850 - 44,850 26,265 6,272 7,500 13,772 35,834 149,000 149,000 191,000 - 92,374 92,374 104,052 - 914,914 - 914,914 44,797 1,679,709 258,914 479,142 2,462,562 1,746,153 EXCESS OF REVENUES OVER (UNDER) EXPENDITURES 66,662 (1,561,277) (13,378) (250,553) 18,995 (1,739,551) 1,167,762 NET CHANGE IN FUND BALANCE 66,662 (1,561,277) (13,378) (250,553) 18,995 (1,739,551) 1,167,762 BEGINNING FUND BALANCE 158,197 1,952,378 142,366 256,977 16,498 2,526,416 1,358,654 ENDING FUND BALANCE $ 224,859 $ 391,101 $ 128,988 $ 6,424 $ 35,493 $ 786,865 $ 2,526,416 Net change in fund balances -total governmental funds $ (1,739,551) $ 1,167,762 Amounts reported for governmental activities in the statements of activities are different because: Governmental funds only report taxes received within 60 days as current fund revenues. All taxes receivable are treated as revenues in the statement of activities. 2,639 8,976 Governmental funds report capital outlays as expenditures. However, in the Statement of Activities, the costs of those assets is depreciated over their estimated useful lives: Capital asset donation (362,203) Governmental funds report principal repayment on debt as an expenditure and debt issuance as an other financing source. Long-term notes provide current financial resources to the governmental funds, but issuing debt increases long term liabilities in the Statement of Net Position. The discount on the long-term debt is an other financial resource in the government fund but decreases the net liability in the Statement of Net Position: Principal repayment on debt 149,000 191,000 Long term debt discount (2,795) (2,795) Change in Net Position of Governmental Activities $ (1,590,707) $ 1,002,740 The accompanying notes are an integral part of these financial statements 9 CHUBBUCK DEVELOPMENT AUTHORITY NOTES TO FINANCIAL STATEMENTS NOTE 1 - Summary of Sianificant Accountina Policies A. Reporting entity The Idaho Urban Renewal Law of 1965 authorized the Mayor, with advice and consent of the City Council, to appoint a board of commissioners for an urban renewal agency to function within the municipality of Chubbuck, provided that the Council has first passed a resolution finding that one or more such areas are necessary, and that there is a need for an urban renewal agency to function in the City. Chubbuck's urban renewal agency, Chubbuck Development Authority (CDA), was found necessary by a resolution in 1992 and the board members were appointed thereafter. Unlike other advisory boards to the City Council, state law declares this agency to be "an independent public body corporate and politic" and gives it a wide range of authority to effectuate urban renewal. Under generally accepted accounting principles, as adopted by the Governmental Accounting Standards Board, the CDA is included in the Annual Financial Statements of the City of Chubbuck as a discretely presented component unit. B. Government -wide and fund financial statements The government -wide financial statements (i.e., the Statement of Net Position and the Statement of Activities) report information on all of the nonfiduciary activities of the government. For the most part, the effect of interfund activity has been removed from these statements. The fund financial statements provide information about the Authority's funds. The emphasis of fund financial statements is on major funds, each displayed in a separate column. The Authority reports the following major funds: The General Fund is the Authority's primary operating fund. It accounts for all financial resources, except those accounted for in another fund. The Chubbuck Tax Increment Financing (TIF) District Fund (Chubbuck District), a special revenue fund, accounts for the Authority's operations within the revenue allocation area of that district. The Chubbuck District was established in 1992 and has a termination date in the year 2023 and was closed in 2024. The Pine Ridge Tax Increment Financing (TIF) District Fund (Pine Ridge District), a special revenue fund, accounts for the Authority's operations within the revenue allocation area of that district. The Pine Ridge District was established in 2016 and has a termination date in the year 2036, except for revenues which may be received in 2037. The Northside Crossing Tax Increment Financing (TIF) District Fund (Northside District), a special revenue fund, accounts for the Authority's operations within the revenue allocation area of that district. The Northside District was established in 2022. The Harvest Spring Tax Increment Financing (TIF) District Fund (Harvest Springs District), a special revenue fund, accounts for the Authority's operations within the revenue allocation area of that district. The Harvest Springs District was established in 2023. The revenue generated in the districts' fund are restricted to be used for the district and within the TIF district boundaries. 10 CHUBBUCK DEVELOPMENT AUTHORITY NOTES TO FINANCIAL STATEMENTS NOTE 1 - Summary of Significant Accounting Policies (Continued) C. Measurement focus, basis of accounting, and financial statement presentation The government -wide financial statements are reported using the economic resources measurement focus and the accrual basis of accounting. Revenues are recorded when earned and expenses are recorded when a liability is incurred, regardless of the timing of related cash flows. Property taxes are recognized as revenues in the year for which they are levied. Grants and similar items are recognized as revenue as soon as all eligibility requirements imposed by the provider have been met. Expenditures generally are recorded when a liability is incurred, as under accrual accounting. However, debt service expenditures, as well as expenditures related to compensated absences and claims and judgments, are recorded only when payment is due. Property taxes and interest associated with the current fiscal period are all considered to be susceptible to accrual and so have been recognized as revenues of the current fiscal period. All other revenue items are considered to be measurable and available only when cash is received by the authority. As a general rule, the effect of interfund activity has been eliminated from the government -wide financial statements D. Assets, liabilities, and net position or fund balance 1. Deposits and investments Unrestricted cash balances from all funds are combined and invested in investments authorized under Idaho State Code. Earnings from these investments are credited to the funds based on the monthly balance of cash in each fund. Cash includes cash on hand, deposits, and other investments which are immediately convertible to cash or have a maturity of less than 90 days. The CDA is authorized under State Code to invest in obligations of the U.S. Treasury, U.S. Government backed institutions, commercial paper, and repurchase agreements. CDA's policy is to restrict investment to highly liquid money market accounts. 2. Receivables and payables Property taxes receivable are recorded when certified by the State Tax Commission in October of each year. Taxes not received within sixty days of year-end are deferred. The taxing authorities within each tax increment financing district levy property taxes by the third Monday of September on a market value basis. These taxes are billed to the taxpayers in November and are due December 20. Real property taxes not paid constitute a lien on the property when entered on the real property assessment roll as delinquent on the first day of January of the succeeding year. Property taxes are assessed and collected for the Authority by Bannock County. 3. Restricted assets It is the Authorities policy to first apply restricted resources when an expense is incurred for purposes for which both restricted and unrestricted net assets are available. When unrestricted resources are spent, the order of spending is committed (if applicable), assigned (if applicable) and unassigned. 4. Capital Assets The Authority has purchased land properties within the Chubbuck TIF District as capital assets. The land is to be developed by the authority, sold to a third party for further development, or donated. It is the policy of the Authority to capitalize assets that are expected to last longer than one year and cost exceeds $5,000. 5. Compensated Absences The Authority has no liability for compensated absences. 11 CHUBBUCK DEVELOPMENT AUTHORITY NOTES TO FINANCIAL STATEMENTS NOTE 1 - Summary of Significant Accounting Policies (Continued) D. Assets, liabilities, and net position or fund balance (continued) 6. Fund Balance In the fund financial statements, governmental funds report the following classifications of fund balance: Nonspendable items- This category includes a portion of net resources that cannot be spent because of their form or because they must be maintained intact. This includes inventories and prepaid items. Restricted items- This category includes resources where limitations are imposed by external entities, such as grantors and creditors, or to comply with laws and regulations of governments. Committed items -This category includes amounts that can only be used for the specific purposes determined by a formal action of the Authority's highest level of decision-making for the Authority. Commitments may be changed or lifted only by the Board taking the same formal action that imposed the constraint originally. Assigned items -Assigned items represent the Authority's intent to use certain resources for specific purposes. The Board may establish the intended use of these funds for a designated purpose. Unassigned items- Represents the remainder of the Authority's equity in governmental fund -type balances in excess of the aforementioned classifications. NOTE 2 - Reconciliation of Government -wide and Fund Financial Statements A. Explanation of certain differences between the governmental fund balance sheet and the government - wide statement of net position. The governmental fund balance sheet includes the reconciliation between fund balance - total governmental funds and net position - governmental activities as reported in the government -wide statement of net position. One element of the reconciliation explains that "Certain receivables are not current resources and are reported as deferred revenues in the governmental funds". The detail of this difference is as follows: Deferred Property Taxes Capital assets are made up of the following non -depreciable assets: Land $ 19,345 $ 1,260,321 On October 15, 2020, the Authority approved the issuance of a bond in the amount of $1,940,000 at a discount of $50,000. The bond carries an interest rate at 6.750%. Long-term Bond Payable $ 1,242,000 Long-term Bond Discount (39,117) $ 1,202,883 NOTE 3 - Stewardship, Compliance and Accountability A. Budgetary information Budgets are adopted on a basis consistent with generally accepted accounting principles. Annual appropriated budgets are adopted for the general and special revenue funds. All annual appropriations lapse at fiscal year end. 12 CHUBBUCK DEVELOPMENT AUTHORITY NOTES TO FINANCIAL STATEMENTS NOTE 3 - Stewardship, Compliance and Accountability (Continued) A. Budgetary information (continued) The Board of the Chubbuck Development Authority is required to hold public meetings in conjunction with adoption of its annual budget. The Authority approved the 2024 budget and will approve future budgets. The new budget is submitted to the board at its meeting in October as part of the cash report presented by the Treasurer. This is when the budget is approved. Budgets may be amended by the same procedure used to adopt the budget. NOTE 4 - Detailed Notes on All Funds A. Deposits and investments Cash and cash equivalents at year-end consist of the following: Deposits Cash in bank Escrow Outstanding checks The Authority has no investments. Bank Book $ 734,923 $ 653,931 129,003 129,003 (80,992) - $ 782,934 $ 782,934 Deposits - Custodial Credit Risk for deposits is the risk that, in the event of bank (financial institute) failure, the government's deposits may not be returned to it. Deposits and investment transactions are subject to risks. Interest Rate Risk is the risk that changes in interest rates will adversely affect the value of an investment. This risk in null since the Authority has no investments. Credit Risk is the risk that an issuer or a counter party to an investment will not fulfill its obligations. Concentration of Credit Risk is the risk of loss attributed to the magnitude of an investment in a single issuer. Because the Authority has all trust deposits held within one trust department, a concentration risk exists. Deposits are held in an institution covered by collateralized accounts or federal depository insurance up to $250,000. The Authority's concentration credit risk is $0. B. Changes in Capital Assets A summary of capital assets at year end is as follows: Beginning Ending Balance Additions Deletions Balance Non -depreciable assets Land $ 1,260,321 $ - $ - $ 1,260,321 $ 1,260,321 $ - $ - $ 1,260,321 13 CHUBBUCK DEVELOPMENT AUTHORITY NOTES TO FINANCIAL STATEMENTS NOTE 4 - Detailed Notes on All Funds (Continued) C. Receivables 1. Property Taxes Property tax revenues are recognized and accrued when billed by Bannock County. CDA's property taxes, levied by the third Monday of September on a market value basis, are billed to the taxpayers in November. Half of the real, personal and mobile home property taxes are due on December 20 and the remainder is due the following June 20. Other property taxes are due December 20. Real property taxes not paid constitute a lien on the property when entered on the real property assessment roll as delinquent on the first day of January of the succeeding year. Property taxes are assessed and collected for CDA by Bannock County. 2. Property Tax Receivable and Deferred Property Taxes At yearend, property tax receivable and deferred tax revenues consisted of the following: General fund Chubbuck Urban Renewal District Fund Pine Ridge Mall Urban Renewal District Fund Northside Crossing TIF District Fund Harvest Springs TIF District Fund Receivables Deferred Tax 3,294 16,051 3,294 16,051 $ 19.345 $ 19.345 D. Long-term Debt On October 15, 2020, the Authority approved the issuance of a bond in the amount of $1,940,000 at a discount of $50,000. The bond carries an interest rate at 6.750% and a maturity date of November 1, 2037. The bond is being used to provide monies to reimburse the developer of the Pine Ridge Mall for eligible costs and thereby provide more capital for further development in the Pine Ridge Mall Project Area. The Pine Ridge Mall Project is within the Pine Ridge Tax Increment Financing District (TIF) District. The bond will be payable from and secured by the revenues generated from the TIF District tax increments. Current portion Noncurrent portion Long-term bond payable Long-term debt interest Annual Debt Service Requirements Year Ending September 30, 2025 2026 2027 2028 2029 2030-2034 2035-2038 Face Value Discount Book Value $ 58,781 $ 2,794 $ 55,987 1,183,219 36,323 1,146,896 $ 1,242,000 $ 39,117 1,202,883 Beginning Ending Balance Additions Reductions Balance $ 1,391,000 $ - $ (149,000) $ 1,242,000 (41,911) - 2,794 (39,117) $ 1,349,089 $ - $ (146,206) $ 1,202,883 14 Principal Interest Total $ 58,781 $ 82,859 $ 141,640 62,815 78,825 141,640 67,127 74,513 141,640 71,735 69,905 141,640 76,658 64,982 141,640 469,824 238,376 708,200 435,060 60,680 495,740 $ 1,242,000 $ 670,140 $ 1,912,140 CHUBBUCK DEVELOPMENT AUTHORITY NOTES TO FINANCIAL STATEMENTS NOTE 5 - Other Information A. Contingent liabilities The majority of the revenue collected by the CDA is derived from tax increment financing. Tax increment financing is a method of segregating a portion of the property taxes paid on properties within an urban renewal district to fund improvements for which the district was formed. This is accomplished by freezing the market value of property within the district. A contingent liability exists when the market value increase in the district is not large enough to fund any debt incurred by the district to finance the improvements within the district. B. Subsequent events Subsequent events were evaluated up to March 10, 2025, the date the financial statements were available to be issued. During the year the Authority closed out the Chubbuck Urban Renewal District, however, there were outstanding projects and expenditures that were completed and finalized after the close of the district. C. Tax abatement During the year the Authority was not subject to any tax abatements. 15 REQUIRED SUPPLEMENTARY INFORMATION 16 CHUBBUCK DEVELOPMENT AUTHORITY SCHEDULE OF REVENUES AND EXPENDITURES - BUDGET AND ACTUAL GENERALFUND FOR THE YEAR ENDED SEPTEMBER 30, 2024 REVENUES Property taxes Interest revenue Other revenue EXPENDITURES Administration Professional services Other expenses NET CHANGE IN FUND BALANCE BEGINNING FUND BALANCE ENDING FUND BALANCE Original Amended Budqet Budqet Actual $ - $ 7 $ 7 $ - - - 36,314 36,314 34,800 58,308 75,138 16,830 34,800 58,315 111,459 53,144 14,000 14,000 14,525 (525) 19,000 19,000 24,000 (5,000) 1,800 25,312 6,272 19,040 34,800 58,312 44,797 13,515 $ - $ 3 66,662 $ 66,659 158,197 $ 224,859 17 CHUBBUCK DEVELOPMENT AUTHORITY SCHEDULE OF REVENUES AND EXPENDITURES - BUDGET AND ACTUAL CHUBBUCK URBAN RENEWAL DISTRICT FUND FOR THE YEAR ENDED SEPTEMBER 30, 2024 Original Amended Budget Budget Actual Amounts Amounts Amounts Variance REVENUES Property taxes $ - $ 433 $ 432 $ (1) Miscellaneous revenue - 118,000 118,000 - - 118,433 118,432 (1) EXPENDITURES Construction - - 736,445 (736,445) Grants - 30,000 20,850 9,150 Professional services - - - - Other expenses - - 7,500 (7,500) Return of surplus funds - - 914,914 (914,914) - 30,000 1,679,709 (1,649,709) NET CHANGE IN FUND BALANCE $ - $ 88,433 (1,561,277) $ (1,649,710) BEGINNING FUND BALANCE 1,952,378 ENDING FUND BALANCE $ 391,101 18 CHUBBUCK DEVELOPMENT AUTHORITY SCHEDULE OF REVENUES AND EXPENDITURES - BUDGET AND ACTUAL PINE RIDGE MALL URBAN RENEWAL DISTRICT FUND FOR THE YEAR ENDED SEPTEMBER 30, 2024 Original Amended Budget Budget Actual Amounts Amounts Amounts Variance REVENUES Property taxes $ 315,000 $ 318,000 $ 241,097 $ (76,903) Interest revenue - - 4,439 4,439 315,000 318,000 245,536 (72,464) 01»kgIQ1101:7*[ Administration 15,000 18,000 17,540 460 Debt services Principal 300,000 300,000 149,000 151,000 Interest and fiscal charges - - 92,374 (92,374) 315,000 318,000 258,914 59,086 REVENUES OVER (UNDER) EXPENDITURES - - (13,378) (13,378) NET CHANGE IN FUND BALANCE $ - $ - (13,378) $ (13,378) BEGINNING FUND BALANCE 142,366 ENDING FUND BALANCE $ 128,988 19 CHUBBUCK DEVELOPMENT AUTHORITY SCHEDULE OF REVENUES AND EXPENDITURES - BUDGET AND ACTUAL NORTHSIDE CROSSING URBAN RENEWAL DISTRICT FUND FOR THE YEAR ENDED SEPTEMBER 30, 2024 REVENUES Property taxes EXPENDITURES Administration Construction Grant expense NET CHANGE IN FUND BALANCE BEGINNING FUND BALANCE ENDING FUND BALANCE Original Amended Budget Budget Actual Amounts Amounts Amounts Variance $ 170,000 $ 228,500 $ 228,589 $ 34,000 60,139 60,138 136,000 419,004 419,004 $ - $ (250,643) (250,553) $ 256,977 20 :• 1 CHUBBUCK DEVELOPMENT AUTHORITY SCHEDULE OF REVENUES AND EXPENDITURES - BUDGET AND ACTUAL HARVEST SPRINGS URBAN RENEWAL DISTRICT FUND FOR THE YEAR ENDED SEPTEMBER 30, 2024 Original Amended Budget Budget Actual Amounts Amounts Amounts Variance REVENUES Property taxes EXPENDITURES Administration Other expenses Grant expense NET CHANGE IN FUND BALANCE BEGINNING FUND BALANCE ENDING FUND BALANCE $ 40,000 $ 40,000 $ 18,995 $ (21,005) 8,000 8,000 - 8,000 32.000 32.000 - 32.000 21 18,995 $ (61,005) 16,498 CHUBBUCK DEVELOPMENT AUTHORITY NOTES TO REQUIRED SUPPLEMENTAL INFORMATION FOR THE YEAR ENDED SEPTEMBER 30, 2024 NOTE 1 - BUDGETARY INFORMATION GENERALFUND The Authority did not budget sufficient expenditures for administration and professional services. These additional expenditures were paid with decreased expenditures in other expenses. CHUBBUCK URBAN RENEWAL DISTRICT FUND The Authority did not budget sufficient amounts for the following expenditures: Construction Other expense Return of surplus funds The under -budgeted expenditures were paid using available fund balances PINE RIDGE MALL URBAN RENEWAL DISTRICT FUND The Authority did not budget sufficient amounts for the following expenditures: Other expenses Bond interest expense The under -budgeted expenditures were paid using revenues in excess of budget and NORTHSIDE CROSSING URBAN RENEWAL DISTRICT FUND The Authority over-estimated both the administrative and grant expenses. The Authority over-estimated the level of revenue from the county. HARVEST SPRINGS URBAN RENEWAL DISTRICT FUND The Authority over-estimated the level of revenue from the county. NOTE 2 - LEGAL ADOPTION OF BUDGET In accordance with Title 50, Chapter 20 of the Idaho State Code, the Agency is required to prepare, approve and adopt an annual budget for filing with the local governing body, for informational purposes. A budget means an annual estimate of revenues and expenses for the following fiscal year of the Agency. The Authority approved the fiscal year end 2024 budget and will approve future budgets. 22 LEGAL NOTICE Notice of Public Hearing Urban Renewal Agency of the City of Chubbuck, Idaho a/k/a Chubbuck Development Authority Budget Amendment for Fiscal Year 2025 A public hearing for consideration of the Urban Renewal Agency Project amended budget for the fiscal year that begins October 1, 2024, and ends September 30, 2025 will be held in Council Chambers, located at 290 E. Linden Ave, Chubbuck, Idaho, on August 19, 2025, at 5:30 p.m., pursuant to Idaho Code §§ 50- 2006(d), 50-2903(5) and 50-1002. Written or oral comments about the proposed budget are welcome. Written comments may be submitted prior to the meeting to: Chubbuck Development Authority, c/o Ashley Squyres, 290 E Linden Ave., Chubbuck, ID 83202. The Agency budget funds the programs, services, and capital projects that the Agency Board and the City Council have determined to be important to meet the Agency's strategic goals as described in the adopted urban renewal plans. Agency does not levy property taxes but rather, collects increment revenues generated in accordance with the urban renewal plans. This public hearing on the proposed budget is required for formal adoption of an amended FY2025 budget. The proposed expenditures and revenues for FY2025 have been tentatively approved by the Chubbuck Urban Renewal Agency Board of Commissioners on August 19, 2025. City Hall is accessible to persons with disabilities. Revenue Sources Other Than Property Taxes Chubbuck Improvement Revenue 55,000 - - Fund Pine Ridge Revenue Allocation Fund - Interest 5,000 5,000 7,000 Pine Ridge Revenue Allocation Fund - Carryover 55,000 Fund Balance Carryover from FY24 Administrative Fund - Carryover 44,800 76,800 FY 2023 FY 2024 FY 2025 Budgeted Budgeted Amended Fund Name Revenues Revenues Revenues Property Tax Revenue (Increment) Chubbuck Improvement Revenue Allocation Fund $ 2,575,000 - - Pine Ridge Revenue Allocation Fund $ 297,000 $ 315,000 $300,000 Northside Crossing Revenue Allocation Fund 170,000 170,000 $228,000 Harvest Springs Revenue Allocation Fund 20,000 40,000 $46,344 Total Property Tax Revenue $ 3,062,000 $ 525,000 $ 574,344 Revenue Sources Other Than Property Taxes Chubbuck Improvement Revenue 55,000 - - Fund Pine Ridge Revenue Allocation Fund - Interest 5,000 5,000 7,000 Pine Ridge Revenue Allocation Fund - Carryover 55,000 Fund Balance Carryover from FY24 Administrative Fund - Carryover 44,800 76,800 Total Revenues- All Sources Fund Name Pine Ridge Revenue Allocation Fund Administrative Expenses Debt Service Debt Trustee Fund Total Northside Crossing Revenue Allocation Fund Administrative Expenses & Capital Improvements Owner Participation Agreements or other Agreements Fund Total Harvest Springs Revenue Allocation Fund Administrative Expenses & Capital Improvements Owner Participation Agreements or other Agreements Capital Improvements Fund Total Administrative Fund Office & Financial Administration City Administrative Reimbursement Legal Dues & Subscriptions Professional Services Other Publications Fund Total Total All Expenditures $ 3,117,000 $ 574,800 $ 713,144 FY 2023 FY 2024 FY 2025 Budgeted Budgeted Amended Expenditures Expenditures Expenditures Publish: & , 2025. 15,000 34,000 18,000 287,000 136,000 180,000 102,000 302,000 170,000 300,000 34,000 8,000 45,600 136,000 32,000 182,400 170,000 40,000 228,000 5,000 9,269 15,000 14,000 37,075 15,000 20,000 18,000 46,344 14,000 80,000 15,000 24,000 18,000 1,800 1,800 20,000 12,000 1,000 1,000 49,800 138,800 $ 3,117,000 $713,144 WITH COMPARATIVE TOTALS AS OF SEPTEMBER 30, 2024 The urban renewal agency for the City of Chubbuck, Idaho CHUBBUCK DEVELOPMENT AUTHORITY A COMPONENT UNIT OF THE CITY OF CHUBBUCK, IDAHO AUDITED FINANCIAL STATEMENTS AS OF SEPTEMBER 30, 2025 Page Title Page 1 Table of Contents 2 INDEPENDENT AUDITOR'S REPORT 3-5 FINANCIAL STATEMENTS Government Wide Statement of Net Position 6 Statement of Activities 7 Governmental Funds Balance Sheet 8 Statement of Revenues, Expenditures, and Changes in Fund Balances 9 NOTES TO THE FINANCIAL STATEMENTS 10-15 REQUIRED SUPPLEMENTARY INFORMATION 16 Schedule of Revenues & Expenditures - Budget to Actual - Governmental Funds 17 Notes to the Statement of Revenues & Expenditures - Budget to Actual 18 19-20 CHUBBUCK DEVELOPMENT AUTHORITY 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 TABLE OF CONTENTS REPORTS REQUIRED BY GENERALLY ACCEPTED GOVERNMENT AUDITING STANDARDS 2 Report on the Financial Statements Opinion Basis for Opinion 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.Our responsibilities under those standards are further described in the Auditor’s Responsibilities for the Audit of the Financial Statements section of our report.We are required to be independent of the Chubbuck Development Authority,and to meet our other ethical responsibilities,in accordance with the relevant ethical requirements relating to our audit.We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion. Responsibilities of Management 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 and for 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. In preparing the financial statements,management is required to evaluate whether there are conditions or events,considered in the aggregate,that raise substantial doubt about the Chubbuck Development Authority’s ability to continue as a going concern for twelve months beyond the financial statement date,including any currently known information that may raise substantial doubt shortly thereafter. In our opinion,the financial statements referred to above present fairly,in all material respects,the respective financial position of the governmental activities information of the Chubbuck Development Authority,as of September 30,2025,and the respective changes in financial position,for the year then ended in accordance with accounting principles generally accepted in the United States of America. INDEPENDENT AUDITOR'S REPORT To the Board of Commissioners Chubbuck Development Authority Chubbuck, Idaho We have audited the accompanying financial statements of the governmental activities and each major fund of the Chubbuck Development Authority,(the Authority)a component unit of City of Chubbuck,as of and for the year ended September 30,2025,and the related notes to the financial statements,which collectively comprise the Authority's basic financial statements as listed in the table of contents. 3 • • • • •Conclude whether,in our judgment,there are conditions or events,considered in the aggregate,that raise substantial doubt about the Authority’s ability to continue as a going concern for a reasonable period of time. We are required to communicate with those charged with governance regarding,among other matters,the planned scope and timing of the audit, significant audit findings, and certain internal control-related matters that we identified during the audit. Required Supplementary Information Management has omitted the management’s discussion and analysis that accounting principles generally accepted in the United States of America require to be presented to supplement the basic financial statements. Such missing 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 statements in an appropriate operational,economic,or historical context.Our opinion on the basic financial statements is not affected by this missing information. Accounting principles generally accepted in the United States of America require that the budgetary Evaluate the appropriateness of accounting policies used and the reasonableness of significant accounting estimates made by management,as well as evaluate the overall presentation of the financial statements. Auditor’s Responsibilities for the Audit of the Financial Statements Our objectives are to obtain reasonable assurance about whether the financial statements as a whole are free from material misstatement,whether due to fraud or error,and to issue an auditor’s report that includes our opinions.Reasonable assurance is a high level of assurance but is not absolute assurance and therefore is not a guarantee that an audit conducted in accordance with generally accepted auditing standards and Government Auditing Standards will always detect a material misstatement when it exists.The risk of not detecting a material misstatement resulting from fraud is higher than for one resulting from error,as fraud may involve collusion,forgery,intentional omissions,misrepresentations,or the override of internal control. Misstatements are considered material if there is a substantial likelihood that,individually or in the aggregate, they would influence the judgment made by a reasonable user based on the financial statements. In performing an audit in accordance with generally accepted auditing standards and Government Auditing Standards, we: Exercise professional judgment and maintain professional skepticism throughout the audit. Identify and assess the risks of material misstatement of the financial statements,whether due to fraud or error,and design and perform audit procedures responsive to those risks.Such procedures include examining, on a test basis, evidence regarding the amounts and disclosures in the financial statements. Obtain an understanding of internal control relevant to the audit 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 Authority’s internal control. Accordingly, no such opinion is expressed. 4 Pocatello, Idaho February 23, 2026 We also have previously audited,in accordance with auditing standards generally accepted in the United States of America,the Authority's basic financial statements for the year ended September 30,2024,and we expressed unmodified opinions on the respective financial statements of the fiduciary fund information.That audit was conducted for the purpose of forming opinions on the financial statements that collectively comprise the Authority’s basic financial statements as a whole.The summarized comparative information is consistent, in all material respects, with the audited financial statements from which it has been derived. Other Reporting Required by Government Auditing Standards In accordance with Government Auditing Standards,we have also issued our report dated February 23,2026, on our consideration of the Authority'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 Authority's internal control over financial reporting and compliance. Supplementary Information 5 2025 2024 ASSETS Current assets Cash and cash equivalents 518,824$ 653,906$ Restricted cash 132,878 129,028 Delinquent property taxes receivable 24,684 19,345 Prepaid expense 4,648 4,312 681,034 806,591 Noncurrent assets Capital assets, not subject to depreciation and amortization 1,260,321 1,260,321 1,260,321 1,260,321 1,941,355 2,066,912 LIABILITIES Current liabilities Accounts payable 256,187 381 Current portion of bond payable 61,085 58,781 317,272 59,162 Noncurrent liabilities Bond payable 1,052,592 1,144,102 1,052,592 1,144,102 1,369,864 1,203,264 NET POSITION Net investment in capital assets 1,260,321 1,260,321 Restricted for districts 331,531 562,031 Unrestricted (1,020,361) (958,704) 571,491$ 863,648$ CHUBBUCK DEVELOPMENT AUTHORITY STATEMENT OF NET POSITION SEPTEMBER 30, 2025 WITH COMPARATIVE TOTALS AT SEPTEMBER 30, 2024 Governmental Activities The accompanying notes are an integral part of these financial statements 6 2025 2024 EXPENSES Community development 657,477$ 1,155,449$ Other expenses 61,415 993,396 Debt service interest 85,246 92,374 804,138 2,241,219 NET (EXPENSES)/REVENUE (804,138) (2,241,219) GENERAL REVENUE Property taxes 485,477 491,759 Interest 18,426 40,753 Other 8,078 118,000 511,981 650,512 CHANGE IN NET POSITION (292,157) (1,590,707) BEGINNING NET POSITION 863,648 2,454,354 ENDING NET POSITION 571,491$ 863,648$ Governmental Activities CHUBBUCK DEVELOPMENT AUTHORITY STATEMENT OF ACTIVITIES FOR THE YEAR ENDED SEPTEMBER 30, 2025 WITH COMPARATIVE TOTALS FOR THE YEAR ENDED SEPTEMBER 30, 2024 The accompanying notes are an integral part of these financial statements 7 Nonmajor General Chubbuck TIF Pine Ridge TIF Northside TIF Harvest Springs Fund District Fund District Fund District Fund TIF District Fund 2025 2024 ASSETS Cash and cash equivalents 199,735$ 253,314$ 13,413$ 24,965$ 27,397$ 518,824$ 653,906$ Restricted cash - - 132,878 - - 132,878 129,028 Prepaid expense 4,648 - - - - 4,648 4,312 Property tax receivable - - - 24,684 - 24,684 19,345 Total assets 204,383$ 253,314$ 146,291$ 49,649$ 27,397$ 681,034$ 806,591$ LIABILITIES Accounts payable 2,873$ 253,314$ -$ -$ -$ 256,187$ 381$ DEFERRED INFLOWS OF RESOURCES Unavailable revenue Property taxes - - - 24,684 - 24,684 19,345 2,873 253,314 - 24,684 - 280,871 19,726 FUND BALANCES Nonspendable 4,648 - - - - 4,648 4312 Restricted - - 146,291 24,965 27,397 198,653 562,031 Unassigned 196,862 - - - - 196,862 224,834 Total funds balance 201,510 - 146,291 24,965 27,397 400,163 786,865$ Total liabilities, deferred inflows of resources, and fund balances 204,383$ 253,314$ 146,291$ 49,649$ 27,397$ 681,034$ 806,591$ Land 1,260,321$ 1,260,321$ 24,684 19,345 Bond payable (1,113,677) (1,202,883) Net Position of Governmental Activities 571,491$ 863,648$ Capital assets used in governmental activities are not financial resources and therefore, are not reported in the funds. Those assets consist of: Some of the property taxes receivable are not available to pay for current period expenditures and, therefore, are not reported in the governmental funds. Long-term liabilities that pertain to governmental funds are not due and payable in the current period and, therefore, are not reported as fund liabilities. All liabilities are reported in the statement of net position. CHUBBUCK DEVELOPMENT AUTHORITY BALANCE SHEET GOVERNMENTAL FUNDS SEPTEMBER 30, 2025 WITH COMPARATIVE TOTALS AT SEPTEMBER 30, 2024 Amounts reported for governmental activities in the statements of net position are different because: The accompanying notes are an integral part of these financial statements 8 Nonmajor General Chubbuck TIF Pine Ridge TIF Northside TIF Harvest Springs Fund District Fund District Fund District Fund TIF District Fund 2025 2024 REVENUES General property tax revenue 28$ -$ 191,032$ 242,563$ 46,515$ 480,138$ 489,120$ Interest revenue 15,164 - 3,262 - - 18,426 40,753 Administration 52,895 - - - - 52,895 75,138 Other revenue - 8,078 - - - 8,078 118,000 68,087 8,078 194,294 242,563 46,515 559,537 723,011 EXPENDITURES Office and operating expense 5,562 398,684 - 179,218 46,520 629,984 13,772 Professional services 27,000 495 - - - 27,495 44,850 Administration 58,874 - 2,540 44,804 8,091 114,309 92,203 Debt services Principal - - 92,000 - - 92,000 149,000 Interest - - 82,451 - - 82,451 92,374 Return of surplus funds - - - - - - 914,914 91,436 399,179 176,991 224,022 54,611 946,239 2,462,562 NET CHANGE IN FUND BALANCE (23,349) (391,101) 17,303 18,541 (8,096) (386,702) (1,739,551) BEGINNING FUND BALANCE 224,859 391,101 128,988 6,424 35,493 786,865 2,526,416 ENDING FUND BALANCE 201,510$ -$ 146,291$ 24,965$ 27,397$ 400,163$ 786,865$ NET CHANGE IN FUND BALANCES - TOTAL GOVERMENTAL FUNDS (386,702)$ (1,739,551)$ 92,000 149,000 (2,795) (2,795) 5,340 2,639 Change in Net Position of Governmental Activities (292,157)$ (1,590,707)$ Governmental funds report bond proceeds as financing sources, while repayment of bond principal is reported as na expenditure. In the statement of net position, however, issuing debt increases long-term liabilities and does not affect the statement of activities and repayment of principal reduces liablities. CHUBBUCK DEVELOPMENT AUTHORITY STATEMENT OF REVENUES, EXPENDITURES, AND CHANGES IN FUND BALANCES FOR THE YEAR ENDED SEPTEMBER 30, 2025 GOVERNMENTAL FUNDS WITH COMPARATIVE TOTALS FOR THE YEAR ENDED SEPTEMBER 30, 2024 Amounts reported for governmental activities in the statements of activities are different because: The change in property taxes receivable to be collected subsequent to year-end, but not available soon enough to pay for the current period's expenditures are not recognized. Payment of General Obligation refunding bond Principal Bond payable debt discount amortization The accompanying notes are an integral part of these financial statements 9 CHUBBUCK DEVELOPMENT AUTHORITY NOTES TO FINANCIAL STATEMENTS A. Reporting entity The Authority reports the following major funds: The Harvest Spring Tax Increment Financing (TIF) District Fund (Harvest Springs District), a special revenue fund, accounts for the Authority's operations within the revenue allocation area of that district. The Harvest Springs District was established in 2023. The Northside Crossing Tax Increment Financing (TIF) District Fund (Northside District), a special revenue fund, accounts for the Authority's operations within the revenue allocation area of that district. The Northside District was established in 2022. The revenue generated in the districts'fund are restricted to be used for the district and within the TIF district boundaries. NOTE 1 - Summary of Significant Accounting Policies The Idaho Urban Renewal Law of 1965 authorized the Mayor,with advice and consent of the City Council,to appoint a board of commissioners for an urban renewal agency to function within the municipality of Chubbuck,provided that the Council has first passed a resolution finding that one or more such areas are necessary,and that there is a need for an urban renewal agency to function in the City. Chubbuck’s urban renewal agency,Chubbuck Development Authority (CDA),was found necessary by a resolution in 1992 and the board members were appointed thereafter.Unlike other advisory boards to the City Council,state law declares this agency to be "an independent public body corporate and politic"and gives it a wide range of authority to effectuate urban renewal. Under generally accepted accounting principles,as adopted by the Governmental Accounting Standards Board,the CDA is included in the Annual Financial Statements of the City of Chubbuck as a discretely presented component unit. B. Government-wide and fund financial statements The government-wide financial statements (i.e.,the Statement of Net Position and the Statement of Activities)report information on all of the nonfiduciary activities of the government.For the most part,the effect of interfund activity has been removed from these statements. The fund financial statements provide information about the Authority's funds.The emphasis of fund financial statements is on major funds, each displayed in a separate column. The General Fund is the Authority’s primary operating fund.It accounts for all financial resources,except those accounted for in another fund. The Chubbuck Tax Increment Financing (TIF)District Fund (Chubbuck District),a special revenue fund,accounts for the Authority’s operations within the revenue allocation area of that district.The Chubbuck District was established in 1992 and has a termination date in the year 2023 and was closed in 2024. The Pine Ridge Tax Increment Financing (TIF)District Fund (Pine Ridge District),a special revenue fund,accounts for the Authority’s operations within the revenue allocation area of that district.The Pine Ridge District was established in 2016 and has a termination date in the year 2036, except for revenues which may be received in 2037. 10 CHUBBUCK DEVELOPMENT AUTHORITY NOTES TO FINANCIAL STATEMENTS 5. Compensated Absences 2. Receivables and payables As a general rule, the effect of interfund activity has been eliminated from the government-wide financial statements. Property taxes receivable are recorded when certified by the State Tax Commission in October of each year.Taxes not received within sixty days of year-end are deferred.The taxing authorities within each tax increment financing district levy property taxes by the third Monday of September on a market value basis.These taxes are billed to the taxpayers in November and are due December 20.Real property taxes not paid constitute a lien on the property when entered on the real property assessment roll as delinquent on the first day of January of the succeeding year. Property taxes are assessed and collected for the Authority by Bannock County. 3. Restricted assets 4. Capital Assets It is the Authorities policy to first apply restricted resources when an expense is incurred for purposes for which both restricted and unrestricted net assets are available.When unrestricted resources are spent,the order of spending is committed (if applicable), assigned (if applicable) and unassigned. Unrestricted cash balances from all funds are combined and invested in investments authorized under Idaho State Code.Earnings from these investments are credited to the funds based on the monthly balance of cash in each fund. Cash includes cash on hand,deposits,and other investments which are immediately convertible to cash or have a maturity of less than 90 days. NOTE 1 - Summary of Significant Accounting Policies (Continued) The CDA is authorized under State Code to invest in obligations of the U.S.Treasury,U.S.Government backed institutions,commercial paper,and repurchase agreements.CDA’s policy is to restrict investment to highly liquid money market accounts. The Authority has purchased land properties within the Chubbuck TIF District as capital assets.The land is to be developed by the authority,sold to a third party for further development,or donated.It is the policy of the Authority to capitalize assets that are expected to last longer than one year and cost exceeds $5,000. The Authority has no liability for compensated absences. 1. Deposits and investments The government-wide financial statements are reported using the economic resources measurement focus and the accrual basis of accounting.Revenues are recorded when earned and expenses are recorded when a liability is incurred,regardless of the timing of related cash flows.Property taxes are recognized as revenues in the year for which they are levied.Grants and similar items are recognized as revenue as soon as all eligibility requirements imposed by the provider have been met. Expenditures generally are recorded when a liability is incurred,as under accrual accounting.However,debt service expenditures,as well as expenditures related to compensated absences and claims and judgments,are recorded only when payment is due. Property taxes and interest associated with the current fiscal period are all considered to be susceptible to accrual and so have been recognized as revenues of the current fiscal period.All other revenue items are considered to be measurable and available only when cash is received by the authority. C. Measurement focus, basis of accounting, and financial statement presentation D. Assets, liabilities, and net position or fund balance 11 CHUBBUCK DEVELOPMENT AUTHORITY NOTES TO FINANCIAL STATEMENTS 6. Fund Balance 24,684$ Capital assets are made up of the following non-depreciable assets: Land 1,260,321$ Long-term Bond Payable 1,150,000$ Long-term Bond Discount (36,323) 1,113,677$ Deferred Property Taxes A.Explanation of certain differences between the governmental fund balance sheet and the government- wide statement of net position. Restricted items -This category includes resources where limitations are imposed by external entities,such as grantors and creditors,or to comply with laws and regulations of governments.CDA has $198,653 in restricted fund balance at yearend. The governmental fund balance sheet includes the reconciliation between fund balance -total governmental funds and net position -governmental activities as reported in the government-wide statement of net position.One element of the reconciliation explains that "Certain receivables are not current resources and are reported as deferred revenues in the governmental funds". The detail of this difference is as follows: Unassigned items -Represents the remainder of the Authority's equity in governmental fund-type balances in excess of the aforementioned classifications. CDA has $196,862 in unassigned fund balance at yearend. Assigned items-Assigned items represent the Authority's intent to use certain resources for specific purposes.The Board may establish the intended use of these funds for a designated purpose. On October 15,2020,the Authority approved the issuance of a bond in the amount of $1,940,000 at a discount of $50,000. The bond carries an interest rate at 6.750%. Budgets are adopted on a basis consistent with generally accepted accounting principles.Annual appropriated budgets are adopted for the general and special revenue funds. All annual appropriations lapse at fiscal year end. NOTE 3 - Stewardship, Compliance and Accountability NOTE 1 - Summary of Significant Accounting Policies (Continued) D. Assets, liabilities, and net position or fund balance (continued) Nonspendable items-This category includes a portion of net resources that cannot be spent because of their form or because they must be maintained intact. This includes prepaid items in the amount of $4,648. In the fund financial statements, governmental funds report the following classifications of fund balance: NOTE 2 - Reconciliation of Government-wide and Fund Financial Statements Committed items-This category includes amounts that can only be used for the specific purposes determined by a formal action of the Authority's highest level of decision-making for the Authority.Commitments may be changed or lifted only by the Board taking the same formal action that imposed the constraint originally. A. Budgetary information 12 CHUBBUCK DEVELOPMENT AUTHORITY NOTES TO FINANCIAL STATEMENTS Deposits Bank Book Cash in bank 587,586$ 518,824$ Escrow 132,666 132,878 Outstanding checks (68,550) - 651,702$ 651,702$ B. Changes in Capital Assets Beginning Ending Balance Additions Deletions Balance Non-depreciable assets Land $ 1,260,321 $ - $ - $ 1,260,321 $ 1,260,321 $ - $ - $ 1,260,321 NOTE 3 - Stewardship, Compliance and Accountability (Continued) A. Budgetary information (continued) A summary of capital assets at year end is as follows: Credit Risk is the risk that an issuer or a counter party to an investment will not fulfill its obligations. Deposits -Custodial Credit Risk for deposits is the risk that,in the event of bank (financial institute)failure,the government's deposits may not be returned to it. The Board of the Chubbuck Development Authority is required to hold public meetings in conjunction with adoption of its annual budget.The Authority approved the 2024 budget and will approve future budgets.The new budget is submitted to the board at its meeting in October as part of the cash report presented by the Treasurer.This is when the budget is approved. Budgets may be amended by the same procedure used to adopt the budget. NOTE 4 - Detailed Notes on All Funds A. Deposits and investments Deposits and investment transactions are subject to risks. The Authority has no investments. Concentration of Credit Risk is the risk of loss attributed to the magnitude of an investment in a single issuer. Because the Authority has all trust deposits held within one trust department,a concentration risk exists.Deposits are held in an institution covered by collateralized accounts or federal depository insurance up to $250,000.The Authority's concentration credit risk is $337,586. Interest Rate Risk is the risk that changes in interest rates will adversely affect the value of an investment.This risk in null since the Authority has no investments. Cash and cash equivalents at year-end consist of the following: 13 CHUBBUCK DEVELOPMENT AUTHORITY NOTES TO FINANCIAL STATEMENTS C. Receivables 1. Property Taxes 2. Property Tax Receivable and Deferred Property Taxes At yearend, property tax receivable and deferred tax revenues consisted of the following: Receivables Deferred Tax General fund -$ -$ Pine Ridge Mall Urban Renewal District Fund - - Northside Crossing TIF District Fund 24,684 24,684 Harvest Springs TIF District Fund - - 24,684$ 24,684$ Face Value Discount Book Value Current portion 65,096$ 2,794$ 62,302$ Noncurrent portion 1,084,904 33,529 1,051,375 1,150,000$ 36,323$ 1,113,677$ Beginning Ending Balance Additions Reductions Balance 1,242,000$ -$ (92,000)$ 1,150,000$ (39,117) - 2,794 (36,323) 1,202,883$ -$ (89,206)$ 1,113,677$ Annual Debt Service Requirements Year Ending September 30,Principal Interest Total 2026 65,096$ 76,545$ 141,641$ 2027 69,564 75,077 144,641 2028 74,338 67,302 141,640 2029 79,441 62,199 141,640 2030 84,894 56,747 141,641 2030-2034 520,297 187,905 708,202 2035-2038 256,370 21,555 277,925 1,150,000$ 547,330$ 1,697,330$ Property tax revenues are recognized and accrued when billed by Bannock County.CDA’s property taxes,levied by the third Monday of September on a market value basis,are billed to the taxpayers in November.Half of the real, personal and mobile home property taxes are due on December 20 and the remainder is due the following June 20. Other property taxes are due December 20.Real property taxes not paid constitute a lien on the property when entered on the real property assessment roll as delinquent on the first day of January of the succeeding year. Property taxes are assessed and collected for CDA by Bannock County. D. Long-term Debt On October 15,2020,the Authority approved the issuance of a bond in the amount of $1,940,000 at a discount of $50,000.The bond carries an interest rate at 6.750%and a maturity date of November 1,2037.The bond is being used to provide monies to reimburse the developer of the Pine Ridge Mall for eligible costs and thereby provide more capital for further development in the Pine Ridge Mall Project Area.The Pine Ridge Mall Project is within the Pine Ridge Tax Increment Financing District (TIF)District.The bond will be payable from and secured by the revenues generated from the TIF District tax increments. Long-term bond payable Long-term debt interest NOTE 4 - Detailed Notes on All Funds (Continued) 14 CHUBBUCK DEVELOPMENT AUTHORITY NOTES TO FINANCIAL STATEMENTS A. Contingent liabilities B. Subsequent events C. Tax abatement NOTE 5 - Other Information The majority of the revenue collected by the CDA is derived from tax increment financing.Tax increment financing is a method of segregating a portion of the property taxes paid on properties within an urban renewal district to fund improvements for which the district was formed.This is accomplished by freezing the market value of property within the district. A contingent liability exists when the market value increase in the district is not large enough to fund any debt incurred by the district to finance the improvements within the district. During the year the Authority was not subject to any tax abatements. Subsequent events were evaluated up to February 23,2026,the date the financial statements were available to be issued. During the year the Authority closed out the Chubbuck Urban Renewal District,however,there were outstanding projects and expenditures that were completed and finalized after the close of the district. 15 REQUIRED SUPPLEMENTARY INFORMATION 16 Variance Final Actual with Original Amended Amounts Final Budget REVENUES General property tax revenue 520,000$ 574,344$ 480,138$ (94,206)$ Interest revenue 7,000 7,000 18,426 11,426 Other revenue - - 60,973 60,973 527,000 581,344 559,537 (21,807) EXPENDITURES Office and operating expense 434,800 489,144 744,293 (255,149) Professional services 44,000 44,000 27,495 16,505 Debt services Principal 95,000 95,000 92,000 3,000 Interest 85,000 85,000 82,451 2,549 658,800 713,144 946,239 (233,095) NET CHANGE IN FUND BALANCE (131,800)$ (131,800)$ (386,702) (254,902)$ BEGINNING FUND BALANCE 131,800 131,800 786,865 655,065 ENDING FUND BALANCE -$ -$ 400,163$ 400,163$ CHUBBUCK DEVELOPMENT AUTHORITY SCHEDULE OF REVENUES, AND EXPENDITURES, AND CHNGES IN FUND BALANCES - BUDGET AND ACTUAL - GOVERNMENTAL FUNDS FOR THE YEAR ENDED SEPTEMBER 30, 2025 Budgeted Amounts 17 NOTE 1 -BUDGETS AND BUDGETARY ACCOUNTING Formal budgetary integration is employed as a management control device during the year. Prior to September 1,the members of the Board of Directors and the contract administrator prepare a proposed operating budget for the fiscal year commencing on October 1.The operating budget includes proposed expenditures and the means of financing them. Public hearings are conducted at City Hall to obtain taxpayer comments. Prior to October 1, the budget is legally enacted through passage of an ordinance. Budgets are adopted on a basis consistent with GAAP for the funds.All annual appropriations lapse at fiscal year-end.Revisions that alter the total expenditure appropriation of any fund must be approved by the board of commissioners.State law does not allow fund expenditures to exceed fund appropriations. CHUBBUCK DEVELOPMENT AUTHORITY NOTES TO REQUIRED SUPPLEMENTAL INFORMATION SEPTEMBER 30, 2025 CDA follows these procedures in establishing the budgetary data reflected in the financial statements: 18 To the Board of Commissioners Chubbuck Development Authority Chubbuck, Idaho Report on Internal Control Over Financial Reporting 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 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 Standardsd issued by the Comptroller General of the United States,the financial statements of the governmental activities and each major fund,and the aggregate remaining fund information of Chubbuck Development Authority,a component unit of City of Chubbuck,as of and for the year ended September 30,2025,and the related notes to the financial statements,which collectively comprise Chubbuck Development Authority’s basic financial statements,and have issued our report thereon dated February 23, 2026. In planning and performing our audit,we considered Chubbuck Development Authority’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 Chubbuck Development Authority’s internal control over financial reporting.Accordingly,we do not express an opinion on the effectiveness of the Chubbuck Development Authority’s internal control over financial reporting. 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.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. Our consideration of internal control was for the limited purpose described in the first paragraph of this section and was not designed to identify all deficiencies in internal control that might be material weaknesses or,significant deficiencies.Given these limitations,during our audit we did not identify any deficiencies in internal control that we consider to be material weaknesses.However,material weaknesses may exist that have not been identified. 19 Report on Compliance and Other Matters Chubbuck, Idaho February 23, 2026 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. As part of obtaining reasonable assurance about whether the Authority'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 no instances of noncompliance or other matters that are required to be reported under Government Auditing Standards. 20