HomeMy WebLinkAbout2019 CDAThe 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, 2019
WITH COMPARATIVE TOTALS AS OF SEPTEMBER 30, 2018
CHUBBUCK DEVELOPMENT AUTHORITY
TABLE OF CONTENTS
Page
Title Page 1
Table of Contents 2
AUDITOR'S REPORTS 3-5
MANAGEMENT'S DISCUSSION AND ANALYSIS 6-9
FINANCIAL STATEMENTS
Government Wide
Statements of net position 10
Statements of activities 11
Governmental Funds
Balance sheets 12
Statements of revenues, expenditures, and changes in fund balances 13
NOTES TO FINANCIAL STATEMENTS 14-19
REQUIRED SUPPLEMENTARY INFORMATION 2�
Schedule of revenues and expenditures -budget to actual -General Fund 21
Schedule of revenues and expenditures
-budget to actual - Chubbuck and Pine Ridge
Mall Urban District Fund 22
Notes to the statement of revenues and expenditures -budget to actual 23
REPORTS REQUIRED BY GENERALLY ACCEPTED GOVERNMENT AUDITING
STANDARDS
Report on Compliance and on Internal Control Over Financial Reporting
Based on an Audit of Financial Statements Performed in Accordance
With Government Auditing Standards 24-25
E
Deaton & Company, Chartered
Certified Public Accountants
215 North 91h, Suite A
Pocatello, Idaho 83201-5278
(208)232-5825
Members of Idaho Society of Certified Public Accountants
Members of American Institute of Certified Public Accountants
INDEPENDENT AUDITOR'S REPORT
To the Board of Commissioners
Chubbuck Development Authority
Chubbuck, Idaho
Report on the Financial Statements
We have audited the accompanying financial statements of the governmental activities and each
major fund of the Chubbuck Development Authority, a component unit of the City of Chubbuck, Idaho,
as of and for the year ended September 30, 2019, and the related notes to the financial statements,
which collectively comprise the Authority's basic financial statements as listed in the table of contents.
INanagement'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.
Opinion
In our opinion, the financial statements referred to above present fairly, in all material respects, the
respective financial position of the governmental activities and each major fund information of the
Chubbuck Development Authority, as of September 30, 2019, 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.
Other Matters
Required Supplementary Information
Accounting principles generally accepted in the United States of America require that the
management discussion and analysis and budgetary comparison information on pages 6 - 9 and 20 -
22, respectively, 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 statements 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
We have also 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 301
2018, which are shown as summarized comparative totals and not as fully disclosed comparative
financials with the accompanying financial statements and we expressed unmodified opinions on the
respective financial statements of the governmental activities, and the aggregate remaining fund
information. That audit was conducted for the purpose of forming opinions on the financial statements
that collectively comprise the Chubbuck Development 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 January
291 2020) 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 Chubbuck Development
Authority's internal control over financial reporting and compliance.
Chubbuck,ldaho
January 29, 2020
,.. ,f Discussion and Analysis
or the Year Ended September 30, 2019
As management of the Chubbuck Development Authority, we offer readers of the Chubbuck
Development Authority's financial statements this narrative overview and analysis of the financial
activities for the fiscal year ended September 30, 2019. We encourage readers to consider the
information presented here in conjunction with additional information that we have furnished in
our financial statements and notes to the financial statements.
Financial Highlights
• The assets and deferred outflows of the Chubbuck Development Authority exceed
its liabilities and deferred inflows at the close of the most recent fiscal year by
$2,125,517 (net position).
• The Authority's net position increased from 2018 to 2019 by $1,033,584.
• At the end of the current fiscal year, fund balances for the Authority was $1,500,504
or 52 percent of total fund expenditures.
• During the current fiscal year, the Authority's liabilities increased by $271,792. The
increase was primarily due to the long-term note issued to purchase land.
Overview of the Financial Statements
This discussion and analysis is intended to serve as an introduction to the Authority's basic
financial statements. The Authority's basic financial statements are comprised of three
components: 1) governmental -wide financial statements, 2) Urban Renewal District
financial statements and 3) notes to the financial statements. This report also contains other
supplementary information in addition to the basic financial statements themselves.
Government -wide financial statements. The government -wide financial statements are designed
to provide readers with a broad overview of the Chubbuck Development Authority's finances, in a
manner similar to a private -sector business.
The Statement of Net Position presents information on all of the Chubbuck Development
Authority's assets, deferred outflows and liabilities with deferred inflows, with the difference
between each reported as net position. Over time, increases or decreases in net position may serve
as a useful indicator of whether the financial position of the Authority's is improving or
deteriorating.
The Statement of Activities presents information showing how the Chubbuck Development
Authority's net position changed during the fiscal year. All changes in the assets are reported when
the underlying event giving rise to the change occurs, regardless of the timing of related cash flows.
Thus, revenues and expenses are reported in this statement for some items that will only result in
cash flows in the future fiscal periods (e.g. uncollected taxes).
The government -wide financial statements distinguish functions of the Chubbuck Development
Authority that are principally supported by taxes. The governmental activities of the Chubbuck
Development Authority consist of infrastructural renewal, development, and administration.
Fund Financial Statements. A fund is a grouping of related accounts that is used to maintain
control over resources that have been segregated from specific activities or objectives. The
Chubbuck Development Authority, like other Development Authorities, uses fund accounting to
ensure and demonstrate compliance with finance -related legal requirements. The funds of the
Development Authority can be divided into three categories: General funds, Chubbuck Urban
Renewal District Funds, and Pine Ridge Mall Urban Renewal District Funds.
The government -wide financial statements are reported using the economic resources
measurement focus and the accrual basis of accounting.
Governmental fund financial statements are reported using the current financial resources
measurement focus and the modified accrual basis of accounting.
The Chubbuck Development Authority adopts an annual appropriated budget for its funds.
General Funds. General funds are used to account for daily administration and general
activities of the Authority.
Chubbuck Urban. Renewal District Fund and Pine Ridge Mall Urban Renewal District
Fund. The Chubbuck Development Authority maintains two different types of proprietary
funds. These funds are used to maintain control over resources for each district. The funds
help ensure that the resources are used as legally required.
Notes to the Financial Statements. The notes provide additional information that is essential to a
full understanding of the data provided in the government -wide and fund financial statements.
Other information. In addition to the basic financial statements and accompanying notes, this
report also presents certain required supplementary information concerning the Authority's
budgeted expense and revenues versus actual expenses and revenues.
Government -wide Financial Analysis.
Net position may serve, over time, as a use
indicator of the Authority's financial position. In the
case of the Authority, assets exceeded liabilities by $2,125,517 as of September 30, 2019. This was
an increase from 2018 by 136%.
Below is a summary of the Chubbuck Development Authority's Net Position statement.
Cha �b'VbucCc [C1etire[Iioipnuarru}t Ae_gtGYac:Dc'6t9,r's Net Posut
assets
�TM9oncurrent assets
�:�urrent fiabil'ities
�*3oncu:rrent iiabiiitic�,
fWET PC::�.o u uu.���6
E� n restri cted
7
u�rrn
�otirrrr��rrvu�P"uir�A ,,�.��owrurii�s
2019 2018
€�
rent
$ 1 ,387986
1 ,260,3.21
2,999,307
516,940
356,850
87
3,790
1 x-500 Q52
0179,98
17 998
$ 5,51 � $ 898,954
Governmental activities. Governmental activities increased net position by $1,033,584.
Below is summary of the Chubbuck Development Authority's Changes in Net Position.
Chubbuck Development Authority's Changes In Net Position
Governmental Activities
2019 20'18
EXPENSES
General government 165 1381215
Chubbuck Urban Renewal District 1,5871990 4,255,082
Pine Ridge Flail Urban Renewal District 214,804 1751023
118021905 415081320
REVENUES
Charges for services 321556 1381215
32.556 138,215
NET(EXPENSES)IREVENUE {1,77CJ,409) �4,430,1C15)
Prope►ty taxes 2,780,429 2,775,022
Interest 16,133 20,670
Cain on sale of asset 11001 -
C7ther 430 11230
21803,993 237971522
CHANGE IN NET POSITION 1,03 3,584 (116323583)
EEGINNING NET POSITION 8983954 215311537
PRIOR PERIOD ADJUSTMENT 1921979 -
ENDING NET POSITION
Financial Analysis of the Government's Funds
$ 231251517 $ 8983954
As noted earlier, the Authority uses fund accounting to ensure and demonstrate compliance with
finance -related legal requirements.
Governmental funds. The focus of the Chubbuck Development Authority's governmental funds is
to provide information on near-term inflows, outflows, and balances of spendable resources. Such
information is useful in assessing the Chubbuck Development Authority's financing requirements.
In particular, unrestricted fund balance may serve as a useful measure of the government's net
resources available for spending at the end of the fiscal year.
General Fund Budgetary Highlights. The general fund did not have a budget appropriated for the
fiscal year. However, the actual revenues exceeded expenses by $415 in the general fund.
S
Chubbuck and Pine Ridge Mall Urban Renewal District Funds. The district funds did not
budget sufficient expenditures in the amount of $877,700 for various accounts. The revenues in
excess of budget by $275,360 and expenditures below budget in the amount of $1,079,692 were
used to pay the insufficient budget expenditures.
Current Known Facts and Conditions
During the year, the Chubbuck Urban Renewal District (Chubbuck District) received property tax
revenue allocation of $2,611,932 and paid reimbursement of $40,833. The Pine Ridge Mall Urban
Renewal District (Pine Ridge District) received property tax revenue allocation of $174,889 and
paid reimbursement of $214,804. The Pine Ridge District's $39,915 deficit was funded from the
$53,507 tax revenue residual of the year 2018.
The Authority's largest expenditure was $1,067,342 in capital outlay. The capital outlay was the
purchased land properties within the Chubbuck District.
Request for information
The financial report is designed to provide citizens of the City of Chubbuck and creditors with a
general overview of the Authority's finances and to show the Authority's accountability for the
money it receives. If you have question about this report or need any additional financial
information, contact the Authority at 5160 Yellowstone Ave, Chubbuck, ID 83202, telephone
(208)237-2400.
�7
CHUBBUCK DEVELOPMENT AUTHORITY
STATEMENTS OF NET POSITION
SEPTEMBER 30, 2019
WITH COMPARATIVE TOTAL AT SEPTEMBER 30, 2018
Governmental Activities
2019 2018
ASSETS
Current assets
Cash and cash equivalents $ 11708,247
Property tax receivable 307739
1,738,986
Noncurrent assets
Non -depreciable capital assets 112601321
1.260,321
2,999,307
LIABILITIES
Current liabilities
Accounts payable 2161940
Current portion of long-term debt 300,000
516.940
Noncurrent liabilities
Note payable 3561850
356,850
873,790
Restricted for districts 1,270,859
Unrestricted $ 854,658
$ 1,475,094
25, 858
1.500,952
1,500,952
601, 998
6017998
6013998
649,020
$ 249, 934
The accompanying notes are an integral part of these financial statements
10
CHUBBUCK DEVELOPMENT AUTHORITY
STATEMENTS OF ACTIVITIES
FOR THE YEAR ENDED SEPTEMBER 30, 2019
WITH COMPARATIVE TOTALS FOR THE YEAR ENDED SEPTEMBER 30, 2018
EXPENSES
General government
Chubbuck Urban Renewal District
Pine Ridge Mall Urban Renewal District
REVENUES
Charges for services
NET (EXPENSES)/REVENUE
GENERAL REVENUE
Property taxes
Interest
Gain on sale of asset
Other
CHANGE IN NET POSITION
BEGINNING NET POSITION
PRIOR PERIOD ADJUSTMENT
ENDING NET POSITION
Governmental Activities
2019 2018
165 138,215
1,587,996 4,255,082
214,804 175,023
1,802,965 41568,320
32,556 138,215
32.556 1389215
(1,770,409) (4,430,105)
2,786,429 2,775,622
161133 201670
1,001 -
430 1,230
2.803.993 21797,522
1,033,584 (1,632,583)
898,954 2,531,537
192,979 -
$ 2,125, 517 $ 898,954
The accompanying notes are an integral part of these financial statements
11
CHUBBUCK DEVELOPMENT AUTHORITY
BALANCE SHEETS
GOVERNMENTAL FUNDS
SEPTEMBER 30, 2019
WITH COMPARATIVE TOTAL AT SEPTEMBER 30, 2018
Nonmajor
Chubbuck Pine Ridge Mall
General Urban Renewal Urban Renewal
Fund District Fund District Fund
ASSETS
Cash and cash equivalents $ 1,645 $ 17686,453 $ 201149
Property tax receivable - 301739 -
2019
$ 1,708,247
30,739
2018
$ 1,4751094
25.858
$ 1,645 $ 1,717,192 $ 20,149 $ 1,738,986 $ 1,500,952
LIABILITIES
Accounts payable $ - $ 2161940 $ - $ 216,940 $ 601,998
Deferred tax revenues - 211542 - 211542 21,934
- 2381482 - 238,482 6231932
FUND BALANCES
Restricted - 112500710 201149 $ 11270,859 $ 649,020
Committed - 2287000 - 2281000 228,000
Unassigned 11645 - - 11645 -
11645 114787710 201149 115001504 8771020
$ 1,645 $ 1,717,192 $ 20,149
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. 1,260,321 -
Certain receivables are not current resources and are report
ed as deferred
revenues in the governmental funds 21,542 21,934
Long-term liabilities are not due and payable in the current period and therefore,
are not reported in the governmental funds:
Note payable (656,850) -
Net Position of Governmental Activities
$ 21125,517 $ 898,954
The accompanying notes are an integral part of these financial statements
12
CHUBBUCK DEVELOPMENT AUTHORITY
STATEMENTS OF REVENUES, EXPENDITURES, AND CHANGES IN FUND BALANCES
GOVERNMENTALFUNDS
FOR THE YEAR ENDED SEPTEMBER 30, 2019
WITH COMPARATIVE TOTALS FOR THE YEAR ENDED SEPTEMBER 30, 2018
REVENUES
Property taxes
Interest revenue
Other revenue
Service and contract revenue
EXPENDITURES
Administration
Projects
Grants
Professional services
Other expenses
Capital outlays
EXCESS OF REVENUES OVER
(UNDER) EXPENDITURES
OTHER FINANCING SOURCES (USES)
Proceeds from sale of assets
Proceeds from debt
Discount on loan
NET CHANGE IN FUND BALANCE
BEGINNING FUND BALANCE
Nonmajor
Chubbuck Pine Ridge Mall
General Urban Renewal Urban Renewal
Fund District Fund District Fund 2019 2018
$ $ 21611,932 $ 174,889 $ 21786,821 $ 21781,210
- 14,927 11056 15,983 20,670
580 - - 580 11230
32,556 - 321556 138,215
580 21659,415 175,945 21835,940 21941,325
40,833 214,804 255,637 2761430
- 1,295,288 - 11295,288 410603650
228,000 - 228,000 228,000
21,289 21,289 31240
165 21586 - 21751 -
11067,342 - 11067,342 -
165 21655,338 214,804 21870,307 415687320
415 4,077 (38,859) (34,367) (1,626,995)
700,000 - 700,000 -
(43,150) - (43,150) -
657,851 - 657,851 -
415 661,928
(38,859) 623,484 (11626,995)
1,230 816,782 59,008 877,020 2,504,015
ENDING FUND BALANCE $ 1,645 $ 11478,710 $ 20,149 $ 11
500,504 $ 877,020
Net change in fund balances -total governmental funds $ 623,484 $(11626,995)
Amounts reported for governmental activities in the statements of activities are different
because:
Governmental funds only report taxes received within sixty days as current fund revenues.
All taxes receivable are treated as revenues in the statement of activities.
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 purchases
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:
Long term debt proceeds
Long term debt discount
Change in Net Position of Governmental Activities
(392) (5,588)
1,067,342 -
(700,000) -
43,150 -
$ 1,0331584 $(11
The accompanying notes are an integral part of these financial statements
13
632,583)
CHUBBUCK DEVELOPMENT AUTHORITY
NOTES TO FINANCIAL STATEMENTS
NOTE 1 - Summary of Significant Accounting 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 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
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 2022.
The Pine Ridge Tax Increment Financing District (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.
The revenue generated in the districts' fund are restricted to be used for the district and within the TIF district
boundaries.
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.
Governmental fund financial statements are reported using the current financial resources measurement focus and
the modified accrual basis of accounting. Revenues are recognized as soon as they are both measurable and
available. Revenues are considered to be available when they are collectible within the current period or soon enough
thereafter to pay liabilities of the current period. For this purpose, the authority considers revenues to be available if
they are collected within 60 days of the end of the current fiscal year.
14
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 (continued)
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.
Asa 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.
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.
15
CHUBBUCK DEVELOPMENT AUTHORITY
NOTES TO FINANCIAL STATEMENTS
NOTE 1 - Summary of Significant Accountinq 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 authority 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 wide statement 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
21,542
Capital assets are made u
C3 p of the folllowing non-decpreciable assets:
Lnd
During the year, the Authority purchased land using anon -interest barring note of $700,000. The
implied interest rate of 3.25% created a discount of the loan in the amount of $43,150.
Long-term Note Payable
Long-term Note Discount
NOTE 3 -Stewardship, Compliance and Accountability
A. Budgetary
information
$
$ 1,260,321
$ 700,000
(43,150)
$ 656, 850
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.
The Board of the Chubbuck Development Authority does not and is not required to hold public meeting in conjunction
with adoption of its annual budget. The new budget is submitted to the board at its meeting in October as part of the
cash report presented by the Treasurer. When the cash report is approved by the board the budget is approved as
well. Budgets may be amended by the same procedure used to adopt the budget.
16
CHUBBUCK DEVELOPMENT AUTHORITY
NOTES TO FINANCIAL STATEMENTS
NOTE 4 - Detailed Notes on All Funds
A. Deposits and investments
Cash and cash equivalents at yearend consist of the following:
Deposits
Cash in bank
Outstanding checks
The Authority has no investments.
Bank
$ 117081247
Book
$ 117081247
$ 1,708,247 $ 1,708,247
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 a variety of 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 and invested in the same fund a
concentration risk exists. Deposits are held in an institution covered by FDIC and are insured up to $250,000. The
Authority's concentration credit risk was $1,458,247.
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
$ 1,303,471
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.
17
CHUBBUCK DEVELOPMENT AUTHORITY
NOTES TO FINANCIAL STATEMENTS
NOTE 4 - Detailed Notes on All Funds (Continued)
C. Receivables (continued)
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
D. Long-term Debt
Receivables
30,739
Deferred Tax
21,542
$ 30,739 $ 21,542
In 20191 CDA has issued a note to provide funds for purchase of land in the Chubbuck District. The note shall provide
$700,000 towards the purchase price and be paid in annual installments of not less than $150,000. The note is non-
interest bearing but has an implied rate of 3.25%The final payment is due December 31, 2022 when the entire
remaininq balance shall be due in full.
Current portion
Face Value Discount
3001000 141383
Noncurrent portion
Book Value
$ $ $ 285,617
4001000 281767 371,233
$ 700,000 $ 43,150 $ 656,850
Beginning
Ending
Blance Additions
Long-term note payable $ - $ 700,000
Long-term debt discount - (43,150)
$ - $ 656,850
C1
NOTE 5 -Other Information
A. Contingent liabilities
Reductions
Balance
$ 700,000
(43,150)
$ 656,850
The majority of the revenue collected by 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.
The Pine Ridge Mall Urban Renewal District agreed to pay the developer the property tax revenue collected by the
District until its expiration or the maximum of 11.7 million, which ever is less.
CHUBBUCK DEVELOPMENT AUTHORITY
NOTES TO FINANCIAL STATEMENTS
NOTE 5 - Other Information (Continued)
B. Committed Funds
The Chubbuck Development Authority has committed to pay for the portion of the Northwest Sewer Interceptor project
lying inside the Chubbuck Urban Renewal District boundary. That portion has been calculated at $2,287,000. This
total is to be paid in an annual payment of $228,000 to Chubbuck Impact Area Waste Water Collection Authority,
which began in FY 2013.
C. Subsequent events
Subsequent events were evaluated up to January 29, 2020, the date the financial statements were available to be
issued.
D. Tax abatement
During the year the Authority was not subject to any tax abatements.
NOTE 6 -Correction of an Error and Prior Period Adjustments
Adjustments Governmental activities:
During the year, the CDA became aware of assets that were expensed in the prior year but were not capitalized in
accordance with the CDA's capitalization policy. The capitalization of the assets increased the statement of net
position and statement of activities withing the governmental activities by $192,979.
19
��c=�l����C� ��J�pl���li��9�Q��1 �V��9����vli ���i �OoV��
20
CHUBBUCK DEVELOPMENT AUTHORITY
SCHEDULE OF REVENUES AND EXPENDITURES - BUDGET AND ACTUAL
GENERALFUND
FOR THE YEAR ENDED SEPTEMBER 30, 2019
REVENUES
Interest revenue
Other revenue
E?(PENDITURES
Administration
NET CHANGE IN FUND BALANCE
BEGINNING FUND BALANCE
ENDING FUND BALANCE
Original
Budget
Amounts
Amended
Budget
Amounts
21
Actual
Amounts Variance
150 150
$ 430 $ 430
580 580
165 (165)
165 (165)
415 $ 415
1,230
$ 1,645
J 0
Q Z
D
LL
® U
Z 0'
i"W®®
® J N
Q O
M
O co
FMM Z
W W LLIW
F Z W
Z I— Q I===W — m CL
® W
QLU
O a JW
LU > W Z
W aW W
®_
LLJ
5 W 0� }
Co W W
COZZy
D LU
W 0 Q'
U W
® Y
W U
J
:3 M
0 Co
W Z)
X: 3:
U U
cn
CD LL
n c
Q (D
'2
C V)
0
M
(O
ami
(�
C
a)
0)C
-0
w
O
Q
E
N
O
CD LL
n c
Q (D
'2
C V)
0
M
(O
ami
Q)
C
a)
0)C
-0
w
�
C
LL L
N
O
U
Q
m
Q
O
C
Ln
N
qq
N
N
LO
O
CD LL
n c
Q (D
'2
C V)
0
r
M
(O
ami
Q)
C
O
0)C
-0
w
N
LO
O
N
Lo
r
Q
m
Q
r
M
(O
O
N
00
LO
M
w
rn
LO
co
N
Lo
r
r O
r
r
co
r
N
N
qq
N
N
LO
O
N
r
CO
M
O
N
co
LO
M
M
O
Lo
co
M
LC)
(Ni
Ln
00
r
M
CO
I�
O
O
co
N
N
O
N
O
M '
CD
Lo
M
O
dam'
r
O
O
r
d
L!j
o
O O
O
M
N
LO
r
O
O
LO
d
N
N
r
r O
r
r
M
LO
O
N
qq
M
N
LO
O
N
M
00
M
L!j
o
O O
O
r
0
LO
N
M
r
O
N
N
N
r
r O
r
M Ln
I�
O
M
N
qq
LO
O
LO
O
LO
M
00
M
W
d'
M
M
d'
O
M
LO
O
co
H
�}
N
V
LnvOo(O(O�fCo
O
O
O
r�
M
N
O
ti
1.
Lfj
I�
O
Ln
Ln
Ln
r
O
N
(D
LO
O
LO
N�
Lj
LO
r
L()
N
LO
N
Ln
O
O
d'
O
O
LO
W
N
M
qq
N
N
N
r
O
O
%;T
N
M
O
r
M
CO
O
LO
M
M
ao
O
LO
CO
O
dT
(O
(O
LO
CO
00
LO
N
0)
M
M
N
r
d'
M
O%
t
066
0
Ni
O
M
r�
N
N
(O
d'
I�
O
d
O
r
%;T
O
O
O
O
00
N
co
OO
r
N
O
CO
O
O
N
r
m
O
O
O
r�
O
N
N
O
O
O
VZ
N
N
O
O
ui
Ln
r�
O
Ln
LS7
r
00
N
d
r
O
O
LLQ
1O
N
M
�
N
LLO
O
co
t�
co
co
N
N
d
00
r
r
co
N
N
In
O
O
V
O
O
LO
CO
N
M
'
N
M
M
r
O
O
d'
N
07
M
r�
LL7
CO
LO
co
N
M
O
LO
CO
O
%t
(O
(0
LO
00
Lo
O
M
co
N
r
'�
M
O
S
CO
O
O
00
O
N
N
(O
d
I�
O
(O
r
d
r
M
M
N
co
r
N
co
r
CO
r
N
N
L()
M
r O
o
O O
O
O
O
O
O
O
r
O
r
O r�
O
O
r O
r
M Ln
M
N
L()
M
r O
r
O O
O
O
O O
O
(O O
L()
r
O O
O
O r�
co
O
r O
r
M Ln
M
O
O
O
N I�
O
0000
I�
ti
CO co
d"
00
O
O
O
O
O
Lo
O
O
O
O
H
�}
N
r
O
r
O
O
O
O
O
O
r
O
r
O
O
00
00
LC
Lf
Lr
0
0
00
' C)
CD
oo�t
'
od-
00
O
O
CD
CD
00
0000
oao
00
O
O
O
O
O
Lo
O
O
O
O
H
O
N
N
O
O
O
r�
M
N
O
O
1.
Lfj
I�
O
Ln
Ln
Ln
r
O
N
(D
LO
O
LO
N�
LO
r
L()
L()
LLQ
N
M
r�
N
co
LO
r
L)
N
N
M
0
0
O
O
O
O
0
0
0
C)
O
v
O
O
O
O
0
0
O
O
O
O
00
O
00
OO
O
O
O
O
O
Ln
O
O
O
O
r�
O
N
N
O
O
O
1�
00
N
O
O
ui
Ln
r�
O
Ln
LS7
r
00
N
d
r
1O
N
M
�
N
LLO
O
t�
N
N
M
cQ W
Z)
c O
0 U) c O U)
O W
Ln ) a) E a) Q Z cA
U)i c a) co W
U
Q o o� �W cn
a)
JY W
N N � N O LL W Ln
o C) <L o
Lo
U O N N S C: (n H— U)
O *' (n a) Z3 C9 O
c � N L cG 0-
a)
0 C C 0 C N O co U U a) U LU LQ
aci 0 6 Q Q a- � Q > U cn o
> c o> o Q j>. O CO c C ® Z E E
+ E O Q O O
o (nO 4)� ® C O Z Q (n S Cn U d CL d 70 -6
Z o( Z E• o Z LU a) a)
W X LU O O
W w ® m a.
N
N
NOTE � -EXPENSES IN EXCESS OF BUDGET
GENERAL FUND
The Authority did not budget sufficient expenditure for administration expenses.
CHUBBUCK AND PINE RIDGE MALL URBAN RENEWAL DISTRICT FUND
The Authority did not budget sufficient expenditure fihe following expenses.
Administration and other expenses
Siphon Road Reconstruction
Industry / Southside Way Streets
Stuart Additions Streets
Pine Ridge Mall TIF reimbursement
Property Acquisitions and Capital Outlay
REVENUE IN EXCESS OF BUDGET
GENERAL FUND
Excess revenues funded the excess expenditures in administration expenses.
CHUBBUCK AND PINE RIDGE MALL URBAN RENEWAL DISTRICT FUND
Revenues in excess of budget and decreased expenditures in Hawthorne Road and Country
Acres Streets were used to pay under -budgeted expenditures.
NOTE 2 -LEGAL ADOPTION OF BUDGET
The authority is not legally required to adopt a budget, however, management provides an
internal budget for control purposes.
23
Deaton & Company, Chartered
Certified Public Accountants
215 North 911, Suite A
Pocatello, Idaho 83201-5278
(208)232-5825
Members of Idaho Society of Certified Public Accountants
Members of American Institute of Certified Public Accountaws
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
To the Board of Commissioners
Chubbuck Development Authority
Chubbuck, Idaho
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, as of and for the years ended September 30, 2019, 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 January 29, 2020.
Internal Control Over Financial Reporting
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. Accordingly, we do not express an opinion on the
effectiveness of the Chubbuck Development Authority'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 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.
Compliance and Other Matters
As part of obtaining reasonable assurance about whether Chubbuck Development Authority's
financial statements are free of 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.
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.
Chubbuck,ldaho
January 29, 2020