HomeMy WebLinkAboutCity of Palm Beach Gardens - Public Financial Report2021
FY ENDING
SEPTEMBER 30
The City of Palm Beach Gardens, Florida
Your Guide to
Popular Annual
Financial Information
A MESSAGE FROM
RON FERRIS
CITY MANAGER
TO THE CITIZENS OF THE CITY OF PALM
BEACH GARDENS
We are pleased to present the City of Palm Beach
Gardens Third Popular Annual Financial Report
(PAFR) for the Fiscal year ending September 30,
2021.
This report is designed to provide a brief analysis of
the City’s fiscal operations, highlight the City’s strong
financial health and display the City’s various ongoing
projects. We understand the importance of being
accountable for the proper management of public
funds and specifically designed this report to be
readily accessible and easily understandable to the
general public. The City is committed to improve
communication with our citizensandtoincrease
public confidence in the government. The report is
reflective of our commitment to preserving our
residents’ trust and the city’s long-term financial
health.
The financial information in this report is derived in
large part from the financial statements contained in
the City’s Annual Comprehensive Financial Report
whichispreparedinaccordancewithGenerally
Accepted Accounting Principles (GAAP) and is
audited by an independent certified public accounting
firm. The financial section of this report focuses
mainly on the City's governmental activities. The
Annual Comprehensive Financial Report contains
more detailed and extensive information, such as, the
audited financial statements, notes, schedules, and
other relevant information. A copy of the Annual
Comprehensive Financial Report is available at the
City of Palm Beach Gardens Municipal offices or on
the City's website at www.pbgfl.com/629/finanical-
reports.com.
We hope you find this report to be informative and
welcome your comments and questions.
Respectfully submitted,
Ron Ferris Allan Owens, CPA, CGFO
City Manager Finance Administrator
At a Glance ........................................................6
About this Report...............................................7
Governance ........................................................8
Our City..…........................................................9
Local Economy................................................10
Principle Property Taxpayers...........................11
Property Tax.…..…..........................................12
City Revenues and Expenditures......................13
Summary of Financial Information..................14
General Fund Reserves.………..…..................16
Capital Assets…...............................................17
Significant Capital Projects…..........................18
Debt…..............................................................19
POPULAR ANNUAL
FINANCIAL REPORT
THE CITY OF PALM BEACH
GARDENS, FLORIDA
FISCAL YEAR ENDING
SEPTEMBER 30, 2021
6
AT A GLANCE
CITY OF PALM BEACH GARDENS
ACCOMPLISHMENTS
The City maintains an excellent financial position, as
evidenced by the General Fund’s unassigned reserves
in FY 2021 of $32.6 million, or 33% of total general
fund expenditures, which complies with Council’s
policy of a minimum balance of 17%. This amount
includes the $6.6 million budget stabilization fund.
The City’s sound financial position is due to a
currently strong economy and real estate market and
pro-active financial management by the Council. New
construction remains strong, with several significant
projects either recently completed, underway, or in
various stages of planning.
One measure of the City’s financial condition is its
bond rating. The rating agencies evaluate the City’s
management, economic conditions, financial
performance and flexibility, and debt. The City’s non-
ad valorem debt is rated AAA by Standard and
Poor’s, AA+ by Fitch, and Aa1 by Moody’s. These
ratings reflect the strong investment quality of the
City’s bonds.
ABOUT THIS REPORT
he City of Palm Beach Gardens is pleased to
present the City’s Third Popular Annual Financial
Report. The Government Finance Officers
Association (GFOA) established the Popular Annual
Financial Reporting Awards Program (PAFR
Program) in 1991 to recognize government entities
that provided the general public and other interested
parties with an easy to understand and concise
overview of information extracted from their
comprehensive annual financial report.
Government Finance Officers Association of the
United States and Canada (GFOA) has given an
Award for Outstanding Achievement in Popular
Annual Financial Reporting to The City of Palm
Beach Gardens for its Popular Annual Financial
Report for the fiscal year ended September 30, 2020.
The Award for Outstanding Achievement in Popular
Annual Financial Reporting is a prestigious national
award recognizing conformance with the highest
standards for preparation of state and local
government popular reports.
T
In order to receive an Award for Outstanding
Achievement in Popular Annual Financial
Reporting, a government unit must publish a
Popular Annual Financial Report, whose contents
conform to program standards of creativity,
presentation, understandability, and reader appeal.
An Award for Outstanding Achievement in Popular
Annual Financial Reporting is valid for a period of
one year only. The City of Palm Beach Gardens has
received its first Popular Award for fiscal year
ended 2019. We believe our current report continues
to conform to the Popular Annual Financial
Reporting requirements, and we are submitting it to
GFOA to determine its eligibility for another
Award.
7
PALM BEACH GARDENS GOVERNANCE
Mayor
Carl Woods
Mayor
Rachelle Litt Vice Mayor
Chelsea Reed
Council Member
Mark Marciano
OUR CITY GOVERNMENT
On March 20,1959,John D.MacArthur,multimillionaire insurance magnate andlandowner,announced his plan to develop approximately 4,000 acres and providehomesfor55,000 people in a new community.This land would be developedunderhiscarefulsupervision.Mr.MacArthur's chosen name for the city was PalmBeachCity.However,permission to use that name was denied,so MacArthur,inkeepingwithhis"garden city"plan,decided to call the city Palm Beach Gardens.He wanted this new city to be a place to raise a family and make a living,torealizetheAmericandream.He envisioned winding streets lined with lush nativeandtransplantedfoliagenamedafterflowersandtrees.He set to work carving theCityofPalmBeachGardensfromemptymilesofdairycattlegrazingland.
The City of Palm Beach Gardens has grown steadily during its sixty plus years inexistence.In 1999,the John D.and Catherine T.MacArthur Foundation soldapproximately14,000 acres of land including approximately 5,000 acres in theCityofPalmBeachGardens.The City Council,entrusted with the responsibilityofensuringqualitydevelopment,was able to reach an agreement with thepurchaserstomanagethisnewgrowth.
The City of Palm Beach Gardens operates with a Council-Manager form ofgovernment,pursuant to the city Charter.Residents are served by five at-largeelectedofficialswhoareresponsiblefordevelopingpolicyfortheCity.
These elected officials,the City Council,in turn,appoint the City Manager who istaskedwithoverseeingalladministrativedutiesandthedailybusinessoperationsofthecity.
8
Council Member
Marcie Tinsley
OUR CITY
The City of Palm Beach Gardens is located in Palm Beach County, Florida in the southeast part of the
state. The City is approximately 7 miles north of West Palm Beach and 70 miles north of Miami.
Current land area is 56.17 square miles, making it the largest land area in Palm Beach County.
Palm Beach Gardens has been fortunate to have land mass that is available for future development,
which will only further enhance the City's economic base and allow the City to continue to prosper
with additional employment opportunities and increases in property valuations and revenues. There is
a significant amount of development within the City and multiple developments that could potentially
increase employment.
9
LOCAL ECONOMY
9
PRINCIPAL PROPERTY TAXPAYERS
10
Percent of Percent of
Taxable Total Taxable Taxable Total Taxable
Assessed Assessed Assessed
Taxpayer Value
Assessed
Rank Value Value Rank Value
The Gardens Venture LLC 360,000,000$ 1 2.75% 205,000,000$ 1 2.64%
Florida Power & Light 122,406,712 2 0.94% 79,926,052 2 1.03%
PR The Quaye Owner LLC 108,409,288 3 0.83%
GLL US Retail LP 100,000,034 4 0.77% 75,000,034 3 0.97%
BREIT MF San Merano LLC 96,330,580 5 0.74% 60,963,354 4 0.79%
BSREP III PBG Resort LLC 90,955,834 6 0.70%
KH Alton LLC 87,677,601 7 0.67%
Advenir @ PGA LLC 86,690,913 8 0.66%
Northlake Blvd LLC 86,178,526 9 0.66% 43,721,685 6 0.56%
Excel Gardens LLC 75,018,847 10 0.57% 30,000,000 9 0.39%
3801 PGA Acquisition Co 50,622,243 5 0.65%
Devonshire at PGA National LLC 40,702,679 7 0.52%
Old Palm Holdings LP 33,273,000 8 0.43%
Mirasol Club Inc.15,852,845 10 0.20%
1,213,668,335$ 9.29%635,061,892$ 8.18%
2021 2012
The tax levy of the City is
established by the Council
prior to October 1st of
each year during the
budget process. The Palm
Beach County Property
Appraiser incorporates the
City’s millage into the
total tax levy, which
includes the County,
County School Board, and
special district tax
requirements.
The Fiscal year 2021
millage rate is based upon
the certified property
valuation received from
the Palm Beach County
Property Appraiser in the
amount of
$13,533,810,519, this
includes new construction
of $165,303,143, and
represents an increase of
3.56% from last year’s
valuation. This is the
tenth consecutive year that
the City’s property
valuation has increased.
Using the final property
valuation number, the total
millage rate is 5.55 which
is the same as last year.
This rate represents a
2.3% increase over the
roll-back rate of 5.4253
mills.
PROPERTY TAX
11
GOVERNMENTAL FUNDS
Typically used to account for
tax-supported activities, the
governmental funds of the City
of Palm Beach Gardens include
the following activities: Police,
Fire, Public Facilities,
Construction Services, Planning
and Zoning, and
Culture/Recreation. Also
included are the various
administrative programs such as
Council, Administration, Legal,
Clerk, Engineering, Purchasing
and Contracts Management,
Finance, Information
Technology, Human Resources,
and General Services. Effective
January 1, 2017, County voters
approved a ballot issue to enact
a one-cent infrastructure sales
surtax to pay for acquisition or
improvements to public
infrastructure.
Property Taxes comprise 65.8%
of the General Fund operating
revenues. This high percentage
is because the City does not
impose garbage/trash collection
fees, utility service taxes, fire
assessments, or storm water
utility taxes. Most of the
expenditures in the General fund
are personnel related, due to the
labor-intensive nature of
providing general government
services. As illustrated in the
chart to the left, Public Safety
expenditures represent the
largest portion of the budget, at
slightly more than $55 million.
CITY REVENUES AND EXPENDITURES
On January 14, 2021, the City approved, through adoption of Resolution 7, 2021,
the issuance of the Public Improvement Bond, Series 2021, in the amount of
$14,000,000 for the purpose of financing the cost of an 18 hole par-three golf
course and related facilities.
13
Road Other Total
General Impact Governmental Governmental
Fund Fund Funds Funds
Revenues
Taxes:
Ad valorem taxes 69,931,518$ --$ --$ 69,931,518$
Local business taxes 1,587,489 -- -- 1,587,489
Utility taxes 1,904,408 -- -- 1,904,408
Special assessment 112,436 -- -- 112,436
Franchise fees 5,731,627 -- -- 5,731,627
Licenses and permits 10,499,890 -- -- 10,499,890
Intergovernmental 12,325,700 -- 5,190,877 17,516,577
Impact fees -- 1,220,845 3,153,908 4,374,753
Charges for services 7,429,263 -- 5,539,763 12,969,026
Fines and forfeitures 222,458 -- 11,241 233,699
Investment earnings 150,654 886 10,562 162,102
Miscellaneous 1,753,877 -- 1,240,398 2,994,275
Total Revenues 111,649,320 1,221,731 15,146,749 128,017,800
Expenditures
Current:
General government 21,802,557 -- -- 21,802,557
Public safety 55,333,103 -- 349,029 55,682,132
Culture and recreation 902,850 -- 6,525,901 7,428,751
Physical environment 13,873,167 -- -- 13,873,167
Transportation -- -- 824,380 824,380
Capital outlay 4,483,499 378,113 2,532,404 7,394,016
Debt service:
Principal 1,952,066 -- 2,917,518 4,869,584
Interest 194,434 -- 448,875 643,309
Bond issuance costs 59,000 -- -- 59,000
Total Expenditures 98,600,676 378,113 13,598,107 112,576,896
Excess (Deficiency) of Revenues
Over (Under) Expenditures 13,048,644 843,618 1,548,642 15,440,904
Other Financing Sources (Uses)
Transfers in -- -- 2,339,968 2,339,968
Transfers out (2,339,968) -- -- (2,339,968)
Capital lease financing 14,000,000 -- -- 14,000,000
Total Other Financing Sources (Uses)11,660,032 -- 2,339,968 14,000,000
Net Change in Fund Balances 24,708,676 843,618 3,888,610 29,440,904
Fund Balances - Beginning 50,962,453 960,252 18,246,447 70,169,152
Fund Balances - Ending 75,671,129$ 1,803,870$ 22,135,057$ 99,610,056$
YEAR ENDED SEPTEMBER 30, 2021
Taxes comprise of all funds most of the City’s revenue, 65.8% and is generated by property taxes, local
business taxes, and utility taxes.
Special assessments revenue collections are related to the Neighborhood Improvement Assessment Program
(NIAP) project for infrastructure improvements.
Franchise fee include both electric and solid waste franchise fees.
Licenses and permits account for 9.4% of Governmental Fund revenues includes city business license taxes.
Intergovernmental category includes federal and state grants, ½ cent sales tax, and state shared revenues.
Impact fees are fees charged on new residential construction and can only be used for capital
expenditures that are a direct result of the demand for services attributed to the new development.
Charges for services contribute 6.7% of the total Governmental Fund revenues. Revenues included in this
category are EMS Fees, dispatch service charges, and fire inspection fees.
Fines and forfeitures revenues include court and code enforcement fines.
Investment earnings include favorable interest rates and unrealized gains resulting from City held
investments.
Miscellaneous revenues in this category include reimbursement of city services, tax searches, and rental fees
for wireless towers.
SUMMARY OF FINANCIAL INFORMATION
The revenues for governmental activities total $111,649,320 for 2021.
14
0
10
20
30
40
50
60
70
80
Mi
l
l
i
o
n
s
Taxes
Special assessment
Franchise fees
Licenses and permits
Intergovernmental
Charges for services
Fines and forfeitures
Investment income
Miscellaneous
Percent Percent Increase
2021 of 2020 of (Decrease)
Revenue Sources Amount Total Amount Total From 2020
Taxes 73,423,415 $ 65.8%71,092,788 $ 67.5% 2,330,627 $ 3.3%
Special assessment 112,436 0.1%112,970 0.1% (534) 100.0%
Franchise fees 5,731,627 5.1%5,473,521 5.2% 258,106 4.7%
Licenses and permits 10,499,890 9.4%7,468,226 7.1% 3,031,664 40.6%
Intergovernmental 12,325,700 11.0%10,091,901 9.6% 2,233,799 22.1%
Charges for services 7,429,263 6.7%7,353,394 7.0% 75,869 1.0%
Fines and forfeitures 222,458 0.2%437,638 0.4% (215,180) (49.2)%
Investment income 150,654 0.1%1,542,513 1.5% (1,391,859) (90.2)%
Miscellaneous 1,753,877 1.6%1,690,216 1.6% 63,661 3.8%
Total revenues 111,649,320 $ 100.0%105,263,167 $ 100.0% 6,386,153 $ 6.1%
Percentage
of Increase
(Decrease)
Expenditure by Function
The expenditures for governmental activities total $98,600,676 for 2021.
15
The expenditures for governmental activities total $98,600,676 for 2021. The largest category is for
public safety and represents 56.1% of all governmental activities.
General Government expenditures comprise departments whose responsibilities are related to the
legislative and administrative services for the benefit of the public and the city unit.
Public Safety expenditures provide services for the security of persons and property.
Culture and Recreation include expenditures toward maintaining recreational facilities for the benefit
of citizens and visitors. This includes various parks, the aquatic complex, tennis courts and golf course.
Physical environment include expenditures for services that provide a suitable living environment by
controlling and utilizing elements of the environment. This would comprise of sustaining safe streets
and roadways, as well as subsidiary facilities such as sidewalks and bridges.
Transportation include expenditures to provide safe and adequate flow of vehicles and pedestrians
through the construction and maintenance of roads, bridges, traffic signals, pathways, and sidewalks.
Capital outlay expenditures stand at 4.5% of the total and include capital expenditures that cost more
than $1,000 and result in a fixed asset for the City. Also included in this category are capital
improvement projects that results in a capital asset or improvement that costs at least $50,000 and have a
useful lifespan of five (5) years.
Debt service includes principal and interest payments for the acquisition, construction, or improvement
of major capital projects or equipment.
-
10
20
30
40
50
60
Mi
l
l
i
o
n
s
General Government
Public Safety
Culture and recreation
Physical environment
Capital Outlay
Debt Service
Percent Percent Increase
2021 of 2020 of (Decrease)
Expenditures Amount Total Amount Total From 2020
General government 21,802,557 $ 22.0%21,419,757 $ 21.0% 382,800 $ 1.8%
Public safety 55,333,103 56.1%52,588,700 51.4% 2,744,403 5.2%
Culture and recreation 902,850 0.9%800,757 0.8% 102,093 12.7%
Physical environment 13,873,167 14.1%13,569,137 13.3% 304,030 2.2%
Capital outlay 4,483,499 4.5%10,249,870 10.0% (5,766,371) (56.3)%
Debt service 2,205,500 2.2%3,612,507 3.5% (1,407,007) (38.9)%
Total expenditures 98,600,676 $ 100.0%102,240,728 $ 100.0% (3,640,052) $ (3.6)%
Percentage
of Increase
(Decrease)
GENERAL FUND RESERVES
GENERAL FUND RESERVES AND HISTORICAL DATA
Looking to the future, by maintaining the same operating millage rate of 5.55, the ten-year financial forecast projects a gradual reduction in reserves through FY 2029. Beginning in FY 2029,
projections indicate this trend will reverse and surpluses will begin to be added back to reserves as
more development in Avenir comes on to the tax rolls.
16
5.50
5.55
5.60
5.65
5.70
FY
2021
FY
2022
FY
2023
FY
2024
FY
2025
FY
2026
FY
2027
FY
2028
FY
2029
FY
2030
$0
$5
$10
$15
$20
$25
$30
Reserves (Millions)
Budget Stabilization Unassigned Reserves Total Millage
Total Millage Rate
Ten -Year Financial Forecast
CAPITAL ASSETS
The City of Palm Beach Gardens recognizes the need to keep pace with the growth of the community and
the needs of the City’s residents. The City prioritizes projects according to guidelines set forth by the
Capital Improvements Element of the Comprehensive Plan. The Capital Budget is designed to balance the
need for public facilities and infrastructure as stated in the City’s Comprehensive Plan.
As of September 30, 2021, the City’s capital assets for both governmental and business type activities
amounted to $136,336,741 (net depreciation). Capital assets include land, roadways, drainage and
structures, equipment, improvements, buildings, and construction in progress.
Major capital asset additions during the current fiscal year included the following:
Tennis Center Clubhouse totaling $5 million.
Fire Training Tower totaling $1.67 million.
Gardens Park Miracle Field Improvement $531 thousand.
Logistics Fuel Station totaling $393 thousand.
17 -
5
10
15
20
25
30
35
40
45
Mi
l
l
i
o
n
s
Land
Construction in progress
Buildings
Roadways
Drainage and structures
Equipment
Improvements
2021 2020
Land 19,779,365$ 19,779,365$
Construction in progress 4,353,595 31,485,281
Buildings 40,963,031 21,094,555
Roadways 23,806,749 24,400,572
Drainage and structures 12,457,608 12,638,484
Machinery and equipment 12,145,933 11,842,530
Improvements other than buildings 22,830,460 20,551,390
Total 136,336,741$ 141,792,177$
Governmental
Activities
SIGNIFICANT CAPITAL PROJECTS
As part of its budget process, the City
prepares and submits to the City Council a
Five-Year Capital Improvement Plan
beginning with the next fiscal year. The City
included several significant non-recurring
projects budgeted for FY 2021. A project is
considered significant if the costs are
projected to exceed $100,000 or it
potentially has a considerable impact on the
current or future operating budgets.Funding
for the significant capital projects listed
below are from General Fund, Capital
Projects Fund, Special Revenue, and
Internal Service Funds.
18
DEBT
The City of Palm Beach Gardens at times needs to
incur debt to fund the acquisition, construction, or
improvement of major capital projects or equipment.
To keep the City’s level of indebtedness within its
available resources while holding down costs, the
City carefully analyzes each new borrowing. The
amount to be borrowed, interest rate, term, and the
existing debt service structure are evaluated to
achieve a balance between the need for a capital
project and the City’s ability to finance it.
General
obligation
bonds
0%
Non ad
Valorem
bonds
payable
91%
Capital leases payable
9%
Much of the City’s debt requirements are met through the issuance of general obligation bonds, public
improvement bonds, bank notes, and capital leases. General obligation bonds are voter approved and backed
by the full faith, credit, and taxing power of the City. They are payable out of ad valorem taxes. The City
currently has no general obligation debt. Public improvement bonds and notes are pledged with non-ad
valorem revenues. One measure of the City’s financial condition is its bond rating. The rating agencies
evaluate the City’s management, economic conditions, financial performance and flexibility, and debt. The
City’s non-ad valorem debt is rated AAA by Standard and Poor’s, AA+ by Fitch, and Aa1 by Moody’s.
These ratings reflect the strong investment quality of the City’s bonds.
The City of Palm Beach Gardens is committed to consistent capital planning through the adoption and
periodic amendments to a Comprehensive Plan. The City’s Comprehensive Plan provides that its total debt
service expenditures shall not exceed 20% of total annual revenues and that total outstanding debt is limited
to no more than 10% of the City’s property tax base.
The above table illustrates the City’s governmental activities long-term debt. At the end of the current fiscal
year, the City had total debt outstanding of $37.6 million. All of the City's outstanding debt is secured by
specified revenue sources.
19
2021 2020
Debt payable:
Non ad valorem bonds payable 34,179,509$ 23,874,816$
Capital leases payable 3,503,270 4,851,343
Total 37,682,779$ 28,726,159$
Governmental
Activities
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