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City of Paducah
Paducah, Kentucky
Comprehensive Annual Financial Report
Year Ended June 30,2012
Issued by the
Finance Department
CITY OF PADUCAH, KENTUCKY
COMPREHENSNE ANNUAL FINANCIAL REPORT
YEAR ENDED JUNE 30, 2012
Introductory Section:
Letter of Transmittal
Organizational Chart
Principal Officials
GFOA Certificate of Achievement
Financial Section:
Independent Auditor's Report
Required Supplementary Information:
TABLE OF CONTENTS
Management's Discussion and Analysis
Basic Financial Statements:
Government-wide Financial Statements:
Statement of Net Assets
Statement of Activities
Fund Financial Statements:
Governmental Funds:
Balance Sheet
Reconciliation of the Governmental Funds Balance
Sheet to Statement of Net Assets
Statement of Revenues, Expenditures and Changes
in Fund Balances
Reconciliation of the Statement of Revenues,
Expenditures and Changes in Fund Balances of
Governmental Funds to the Statement of Activities
Budgetary Comparison Statement (Budgetary Basis)-
General Fund
Budgetary Comparison Statement-Note toRSI-General Fund
Budgetary Comparison Statement (Budgetary Basis) -
Special Revenue Investment Fund
Budgetary Comparison Statement -Note to RSI -Special
Revenue Investment Fund
Proprietary Funds:
Statement of Net Assets
Statement of Revenues, Expenses and Changes in
Fund Net Assets
Statement of Cash Flows
Fiduciary Funds:
Statement of Net Assets
Statement of Changes in Net Assets
Component Units Financial Statements:
Statement of Net Assets
Statement of Activities
Notes to Financial Statements
Required Supplementary Information:
Pension Trust Fund Schedules
Exhibit No. Page No.
1-7
8
9
10
11-12
13-27
1 28-29
2 30-31
3 32-33
4 34-35
5 36-37
6 38-39
7 40-43
8 44
9 45
10 46
11 47
12 48
13 49
14 50
15 51
16 52-53
17 54-55
56-90
A-1 91
Exhibit No. Page No.
Supplementary Information:
General Capital Improvements Detail Statement of
Revenues, Expenditures, and Changes in Fund Balance -
Budget and Actual B-1 92
Debt Service Fund Detail Statement of Revenues,
Expenditures, and Changes in Fund Balance-Budget
and Actual B-2 93
Nonmajor Governmental Funds:
Combining Balance Sheet B-3 94-95
Combining Statement of Revenues, Expenditures and
Changes in Fund Balances B-4 96-97
Detail Statement of Revenues, Expenditures, and
Changes in Fund Balance-Budget and Actual:
Municipal Aid Program Fund B-5 98
Emergency Communication Service Fund B-6 99
Court Awards Fund B-7 100
Small Grant Fund B-8 101
CDBG Grant Fund B-9 102
Special Revenue Bond Fund B-10 103
PRAFund B-11 104
Nonmajor Proprietary Funds:
Nonmajor Enterprise Funds:
Combining Statement of Net Assets C-1 105
Combining Statement of Revenues, Expenses and
Changes in Fund Net Assets C-2 106
Combining Statement of Cash Flows C-3 107
Internal Service Funds:
Combining Statement of Net Assets D-1 108
Combining Statement of Revenues, Expenses, and
Changes in Fund Net Assets D-2 109
Combining Statement of Cash Flows D-3 110
Fiduciary Funds:
Combining Statement of Net Assets -Pension
Trust Funds E-1 111
Combining Statement of Changes in Net Assets -
Pension Trust Funds E-2 112
Combining Statement of Net Assets -
Private-purpose Trust Funds E-3 113
Combining Statement of Changes in Net Assets -
Private-purpose Trust Funds E-4 114
Statement of Changes in Assets and
Liabilities -Agency Funds E-5 115
Table No. Page No.
Statistical Section:
Net Assets by Component I 116
Changes in Net Assets 2 117-119
Fund Balances, Governmental Funds 3 120
Changes in Fund Balances, Governmental Funds 4 121
Assessed and Estimated Actual Value of
Taxable Property 5 122
Statistical Section:
Property Tax Rates -Direct and Overlapping
Governments
Principal Taxpayers
Secured Tax Levies and Collections
Employee License Tax Collections
Principal Employee License Taxpayers
Ratio of Outstanding Debt by Type
Ratio of Net General Bonded Debt Outstanding
Direct and Overlapping Governmental
Activities Debt
Legal Debt Margin Information
Demographic and Economic Statistics
Principal Employers
City Full-Time Employees by Function
Operating Indicators by Function
Capital Asset Statistics by Function
Single Audit Section:
Schedule of Expenditures of Federal Awards
Notes to the Schedule of Expenditures of Federal
Awards
Report on Internal Control Over Financial Reporting
and on Compliance and Other Matters Based on an
Audit of Financial Statements Performed in Accordance
with Government Auditing Standards
Report on Compliance with Requirements That Could Have
a Direct and Material Effect on Each Major Program and
on Internal Control Over Compliance in Accordance with
OMB Circular A-133
Schedule of Findings and Questioned Costs
Schedule of Prior Audit Findings
Table No.
6
7
8
9
10
11
12
13
14
15
16
17
18
19
Page No.
123
124
125
126
127
128
129
130
131
132
133
134
135
136
137
138
139-140
141-142
143
144
CITY OF PADUCAH, KENTUCKY
INTRODUCTORY SECTION
COMPREHENSIVE ANNUAL FINANCIAL REPORT
YEAR ENDED JUNE 30, 2012 .
Honorable Mayor and Commissioners
City of Paducah
Paducah, Kentucky
CITY OF PADUCAH
Finance Department
P.O. Box 2267
Paducah, KY 42002-2267
270-444-8512
December 11, 2012
We are pleased to submit Paducah's Comprehensive Annual Financial Report for the year ended June 30,
2012. Responsibility for the accuracy of the presented data and the completeness and fairness of the
presentation, including all disclosures, rests with the City.
The major objective of this report is to describe the City's financial condition and the financial results of
its operation in a format designed to be useful to the general public, elected officials, investors and
creditors. We believe the data, as presented, is accurate in all material aspects; that it is reported in a
manner designed to present fairly the financial position and results of operations of the various funds. All
disclosures necessary to enable the reader to gain maximum understanding of the City's financial
activities have been included.
City management's narrative on the financial activities of the City for the fiscal year ended June 30, 2012,
is in the Management's Discussion and Analysis (MD&A) section of this report, immediately following
the Report of Independent Auditors. The letter of transmittal is written to complement the MD&A and
the financial statements and should be read from that perspective and in conjunction with all other
sections of the CAFR.
THE CITY
Paducah was established in 1827 by explorer General William Clark. The City of Paducah is situated at
the confluence of the Ohio and Tennessee Rivers in the north central portion of McCracken County.
Paducah is the largest city both in the county and in the Jackson Purchase eight county region. The City
has established itself as the cultural, economic, medical and transportation center for not only the Jackson
Purchase region but for a large portion of Southern Illinois and portions of Western Tennessee and
Southeastern Missouri.
Industry
The Paducah area has moved from the traditional "manufacturing industry" to a "service industry"
economy. Multi-state computer services, significant banking corporations, wholesale and retail trade,
river-related services, the health care industry and related services are the major employment centers.
Economic Development Activities
The Greater Paducah Economic Development Council (GPEDC) coordinates the City's efforts in
strengthening and building economic development activities. Representatives of financial institutions,
utilities, local government, education and the business community serve as the Board of Directors. In
existence since 1987, GPEDC assumes and carries out the responsibility of working with existing industry
and business, as well as identifying and recruiting new companies to the City of Paducah. Additionally,
GPEDC is responsible for development of long-term strategy for economic development activities and
coordinates local entities in the accomplishment of those strategies.
In the early 1990s, the City of Paducah, the State of Kentucky, and several federal agencies, in
conjunction with business, developed a 650-acre 'Information Age' Park. This park is designed to appeal
to firms needing advanced telecommunications and computing capabilities.
In 1997, the City of Paducah, jointly with the County of McCracken, acquired the 'Industrial Park West of
Paducah and McCracken County'. This park contains 218 acres with immediate access to two major
railroad lines, Paducah and Louisville and Paducah and Illinois (formerly lllinois Central). The park is
located within the southwest quadrant of the 1-24/Cairo Road interchange.
In 2007, GPEDC began assembling property to establish Riverport West, a 673-acre industrial park with
rail and river access in western McCracken County.
Churches And Schools
A relatively strong religious base is evident in the community, as demonstrated by the many churches in
Paducah. Numerous churches, representing many of the major denominations, are located within the
City. Several area churches offer televised activities as a convenience to those who do not attend church.
Elementary and secondary education in Paducah is provided by the Paducah Independent School System,
McCracken County School System, Community Christian Academy, and St. Mary's Parochial School
System.
The availability of higher education in the area is continuing to flourish. West Kentucky Community and
Technical College (WKCTC), formerly known as Paducah Community College, is a two-year institution
affiliated with the University of Kentucky's community college system. WKCTC also serves as a site for
the University of Kentucky extended campus graduate programs, in addition to a four-year engineering
college in conjunction with the University of Kentucky. In 2008, WKCTC opened a Paducah School of
Art, which is currently holding classes in its temporary location, while the permanent facility is
developed. In 2010, a new 65,000 square foot Emergency Technology Center was opened, offering
industrial and manufacturing technologies, engineering technology, as well as business and industry
training and information technology programs. This is the first state supported new building to be
constructed on the WKCTC campus in over 20 years. In 2011, Murray State University entered into an
agreement with the City, McCracken County, and the Greater Paducah Economic Council to construct an
approximately 40,000 square foot educational building to serve as their Paducah campus.
Medical Facilities
Paducah serves as the regional medical center for much of the Jackson Purchase Area of Western
Kentucky, a large portion of Southern Illinois, and Northwestern Tennessee. Paducah's medical industry
has almost every major medical specialty represented in the physician population. The medical industry,
represented by Lourdes Hospital and Western Baptist Hospital, provides over 550 beds for medical needs.
The two largest hospitals, together, employ approximately 3,300 persons.
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Recreation And Culture
Citizens have available a wide range of recreational and cultural activities which cater to diverse tastes.
Area residents may choose from fishing on nearby Kentucky and Barkley Lakes to enjoying the
performing arts. City parks provide areas for baseball, softball, golf, football, tennis, disc golf, skate
boarding, soccer, hiking, and picnicking. The Parks Services Department offers a substantial number of
activities for people of all ages.
The 'Dogwood Festival', held in April, highlights the coming of spring in Paducah. Residents are
encouraged to spotlight their trees to illuminate a driving tour to celebrate an abundance of dogwood
trees.
The LowerTown Art and Music Festival is uniquely showcased within the borders of Paducah's 140-year-
old historic neighborhood. The LowerTown Art and Music Festival is an outdoor-juried show in its 1Oth
year. The weekend exhibits the work of local artists and includes jazz, salsa, zydeco, and blues music, as
well as food from area restaurants.
Started in 2004, the 'Rivers Edge International Film Festival' is a four-day event built around the showing
of independent film from around the world. The festival is held in multiple venues including Maiden
Alley Cinema, Market House Theatre, and Yeiser Art Center. In addition to appealing to the film lover,
the festival also provides filmmakers opportunities for exhibition, education, and networking.
Paducah is the site of the Museum of the American Quilter's Society. In May 2008, a congressional
designation was passed naming the museum as the National Quilt Museum of the United States. The
museum, dedicated in 1991, is the centerpiece for the quilters' annual convention held in April. The
convention attracts an estimated 30,000 visitors to Paducah annually.
'Live on Broadway', which began as the 'Downtown After Dinner Program' in May 1997, started out as
an experiment to draw people to Paducah's downtown district. From Memorial Day through July,
businesses remain open late on Saturday night, while street comer musicians of all types entertain.
One of Paducah's oldest celebrations is the '8th of August Emancipation Celebration', which features
African American family reunions, or a homecoming. It is a time for African Americans to pay tribute to
their heritage and roots, and a time of reconciliation.
The 'Barbecue on the River' event was started in 1995, as a way for local charities to raise funds. It
attracts in excess of 70,000 participants to Paducah's riverfront during the last weekend in September.
Over time, this annual event has grown to incorporate other events, including 'Marine Industry Day' and
'Old Market Days'.
Paducah Power sponsors the annual 'Christmas in the Park' lighting display at Noble Park. The public is
invited to a special lighting ceremony the Friday after Thanksgiving. This is the fourteenth year for the
event. Although the event is free, volunteers collect more than $30,000 in cash and thousands of pounds
of canned food annually.
Paducah has an active symphony and several theater groups. The Paducah Symphony Orchestra stages
concerts during the winter season, with the Market House Theater presenting several productions during
the same time period. In addition, West Kentucky Community and Technical College's 'Arts in Focus'
series sponsors a variety of professional productions.
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The most recent addition to the City's cultural lineup is the 'Luther F. Carson Four Rivers Center for the
Performing Arts'. The Center opened in February 2004, as a regional, multiple-purpose facility, with a
1 ,800-seat main hall designed to accommodate a wide variety of cultural and educational programs.
The McCracken County Public Library offers a large selection of literature, special collections, and
programs. The West Kentucky Community and Technical College Library supplements this community
resource. The combined inventories of the two libraries yield nearly 121 ,000 titles, not counting
numerous periodicals and newspapers.
THE GOVERNMENT
Paducah operates under a Council-City Manager form of government. The Paducah Board of
Commissioners is made up of a Mayor and four Commissioners elected at large by the citizens on a non-
partisan basis. The Mayor is elected for a four-year term and Commissioners for a two-year term. The
Mayor and Commissioners have equal voting powers.
The Board of Commissioners sets the policies that govern the City. It appoints advisory citizens groups
that help in the decision-making process. The City Manager is appointed by the Board and assists it in
formulating objectives, policies, and programs. The City Manager is responsible for the day-to-day
operation of the City's 314 full-time employees as of June 30, 2012. Department managers are
responsible for their respective departments and report directly to the City Manager.
REPORTING ENTITY AND ITS SERVICES
For financial statement purposes, as required by generally accepted accounting principles, the City's
Comprehensive Annual Financial Report includes all City of Paducah financial statements (primary
government) and its component units. The component units discussed below are included in the City's
reporting entity because of the significance of their operational or financial relationships with the City of
Paducah.
Blended units are presented as such because the units' governing bodies are substantially the same as the
governing body of the City, or provide services almost entirely to the City of Paducah. The City has only
one blended unit: the Police and Firefighters' Pension Fund, which was established for the benefit of
police and firemen of the City.
The following component units have been presented as discrete units to emphasize that they are legally
separate from the City. Paducah Water Works and Paducah Transit Authority are all included in the
City's financial statements because of their financial relationship with the City.
The City provides a full range of municipal services, including police and fire protection; maintenance of
streets and infrastructure; sanitation services; storm sewer services; cultural events and recreation
activities.
Accounting System
The City's accounting system is organized on the basis of separate funds, each of which is considered to
be a separate accounting entity. The financial activities of each fund generate a separate set of self-
balancing accounts, which comprise its assets, liabilities, fund equity, revenues, and
expenditures/expenses. Municipal resources are allocated to and accounted for in individual funds based
upon the purposes for which they are to be spent and the means by which spending activities are
controlled.
The City's accounting records for the governmental funds and agency funds are maintained on a modified
accrual basis, with revenues being recorded when "measurable and available" and expenditures being
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recorded when the services or goods are received and the liabilities are incurred. Accounting records for
the City's proprietary funds and trust funds are maintained on the accrual basis, with revenues recognized
when earned and expenses recorded when the liability is incurred or economic asset used.
Internal Control
In developing and evaluating the City's accounting system, consideration is given to the adequacy of
internal controls. Internal controls were designed for Paducah's accounting system to reasonably
safeguard its assets against loss from unauthorized use or disposition, check the accuracy of accounting
data, promote operational efficiency, and encourage adherence to prescribed managerial policies.
Budgetary Control
Paducah's budget process provides for input from department managers, top management, elected
officials, and the public to determine what programs and services will be provided for during the
upcoming year. Budgetary control is maintained at the departmental level by comparing budgeted
expenditures with actual expenditures on a periodic and year-to-date basis. An expenditure, which would
result in an overrun of department appropriation, cannot be made until additional funds are appropriated
and a budget amendment is approved. Purchase orders which result in an overrun of department
appropriations cannot be honored until additional appropriations are made available. Unencumbered
funds at year-end roll into the fund balance.
Financial Policies
The City's financial policies are shaped by state law and established by management and the City
Commission. Financial policies include budgeting and financial planning, capital planning, revenue,
investment, debt management, procurement, and accounting and auditing.
During FY2012, some of the City's financial policies did have a significant impact on the financial
statements:
Pension Obligation Costs. In FY2006, the City issued general obligation bonds of $6,100,000 to finance
the police and firefighters' pension fund actuary liability. Since the issuance of these bonds, the City has
made it policy to contribute the normal cost as well as the minimum actuarially sound contribution
annually that would arise from the fund being in a deficit position as of the actuarial date. For FY20I2,
this contribution was $392 thousand. This amount was $45I thousand in FY20 II.
Refinance 2004 Bond Issue. The City's debt management policy states that periodic reviews of all
outstanding debt will be conducted to determine refunding opportunities. The policy also states that
refunds will be undertaken when a net present value of savings of at least 5% of the refunded debt can be
achieved. In August 20 II, the City refinanced its 2004 Infiniti Media Building bonds, saving the City
I3.8% of the refunded debt, or $540,96I (net present value) over the life of the issue. The $3.9I million
general obligation bond issue will be paid off in June 2024.
As part of the City's annual budget process, financial policies are reviewed and amended as necessary. In
FY20 I2, there were no official changes in policy that would have a significant impact on the financial
statements of the City.
LONG-TERM FINANCIAL PLANNING
On October 1, 2005, the City's payroll tax was increased Y2 cent. As a result of the payroll tax increase,
the City Commission created the Investment Fund. The Investment Fund is funded with the Y2 cent
increase and is dedicated to the following purposes: economic development, community redevelopment,
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infrastructure capital investment, and property tax relief. During the FY20 12 budget process, the
Commission reviewed numerous decision packages proposed for the Investment Fund Budget;
expenditures totaling approximately $5 million were appropriated.
The City has numerous infrastructure/capital items that will affect the long-term financial planning
process. The following projects are examples of future considerations facing the City:
Floodwall Restoration. The 12.5-mile long floodwall system protecting a large portion of the Paducah-
McCracken area is approaching 60 years of age. It is still in good condition long beyond its design life;
however, it is in need of necessary repairs. The estimated cost of this restoration project is approximately
$6 million. It is anticipated that grant funds will cover 65% of the project. In FY2009, the City
proceeded with making the most seriously needed repairs by borrowing around $2 million. In FY2011,
the U.S. Army Corps of Engineers (USACE) issued a Feasibility Report, which recommended certain
rehabilitation projects to improve the reliability and restore the system performance of the flood wall. The
USACE and the City are now ready to initiate Preconstruction Engineering and Design (PED) and prepare
plans and specifications for the reconstruction projects as listed within the Feasibility Report.
Riverfront Redevelopment Plan. The City's Riverfront Redevelopment Plan includes proposed
improvements that will provide public amenities, recreational facilities, and public spaces that will tie the
City's downtown to the Ohio River. The plan includes a public marina, boat ramp, recreational trails and
shoreline enhancements, and a steamboat landing, just to name a few. In FY2007, the City was allocated
$5.3 million in federal funds for construction of Phase I and the Ohio River Boat Launch Project.
Environmental assessment and remediation procedures required by the permitting process temporarily
stalled the construction of this phase of the project. However, permits were finally secured and the
official groundbreaking for the project was held in November 2012. Once construction is complete,
operating costs will be a long-term planning consideration.
ECONOMIC CONDITION
The City continues to be aggressive in promoting economic development, since new developmental job
growth is necessary to ensure the continued stability of the City's tax base. Economic indicators and
trends reflect that the area's economy has remained fairly steady considering the nation's recent economic
struggles. It is expected that the economy will continue to hold over the near-term. Area employment
remained flat in comparison to the prior year, with 29,827 persons employed (McCracken County) as of
June 30, 2012.
The June 2012 unemployment rate was 8.0% (McCracken County), which is a decrease from 8.7% in the
prior year, and is favorable compared to the June 20I2 federal unemployment rate of 8.2%. The number
of active electric and water meters was nearly the same as the prior year. The number of building and
electric permits obtained was 1 ,232 for fiscal year 2012 valued at $54 million, which is down $I 7. 7
million from fiscal year 201 I .
INDEPENDENT AUDIT
Kentucky Revised Statute 91 A-040 requires an annual audit of each fund of the City by an auditor of
public accounts or a certified public accountant. The independent certified public accounting firm of
Williams, Williams & Lentz, LLP, has conducted this audit and their opinion has been included in this
report. The City is also subject to the Single Audit Act Amendments of 1996 reporting requirements.
The Single Audit Report is included within this report.
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CERTIFICATE OF ACHIEVEMENT
The Government Finance Officers Association of the United States and Canada (GFOA) awarded a
Certificate of Achievement for Excellence in Financial Reporting to the City of Paducah, Kentucky for its
comprehensive annual financial report for the fiscal year ended June 30, 2011. This was the twenty-first
consecutive year that the City achieved this prestigious award.
In order to be awarded a Certificate of Achievement for Excellence in Financial Reporting, a government
must publish an easily readable and efficiently organized comprehensive annual financial report. This
report must satisfy both generally accepted accounting principles and applicable legal requirements.
A Certificate of Achievement for Excellence in Financial Reporting is valid for a period of one year only.
We believe our current comprehensive annual financial report continues to meet the Certificate of
Achievement Program's requirements; and, we are submitting it to GFOA to determine its eligibility for
another certificate.
ACKNOWLEDGMENTS
The preparation of this report on a timely basis could not be accomplished without the efficient and
dedicated services of the entire staff of the Finance Department. We wish to express our appreciation to
all members of the Finance Department who assisted and contributed to its preparation, and special thanks
to Williams, Williams & Lentz, LLP. We also thank the Mayor, City Manager, and City Commission for
their interest and support in planning and conducting the financial operations of the City in a responsible
and progressive manner.
onathan W. Perkins, CPA
Finance Directorffreasurer
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I
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I
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City Clerk
Engineering/
Public Works
Department
Advisory Board
and
Committees
I
Police
CITY OF PADUCAH, KENTUCKY
ORGANIZATIONAL CHART
CITIZENS OF PADUCAH I
Mayor and Commissioners 1~--------....,
City Manager I
I
I City Attorney
I
Parks
I
I
Paducah Human
Department Fire Department Department Renaissance Resources /Risk
Planning
Department
Finance Department
Alliance
Paducah Riverfront
Development Authority
Information
Systems
Management
CITY OF PADUCAH, KENTUCKY
PRINCIPAL OFFICIALS
BOARD OF COMMISSIONERS
Mayor
Mayor Pro tern
Commissioner
Commissioner
Commissioner
Finance
Police Chief
Fire Chief
City Engineer/Public Works
Planning
Parks Services
Paducah Riverfront Development Authority
Information Services
Human Resources & Risk Management
City Clerk
Public Information
Paducah Renaissance Alliance
CITY MANAGER
Jeff Pederson
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William F. Paxton
Gayle Kaler
Gerald Watkins
Richard Abraham
Carol Gault
Jonathan Perkins, C.P.A.
James Berry
Steve Kyle
Richard Murphy
Stephen Ervin
Mark Thompson
Steve Doolittle
Greg Mueller
Cindy Medford
Tammy Brock
Pam Spencer
Lisa Thompson
Certificate of
Achievement
for Excellence
in Financial
Reporting
Presented to
City of Paducah
Kentucky
For its Comprehensive Annual
Financial Report
for the Fiscal Year Ended
June 30, 2011
A Cettificate of Achievement for Excellence in Financial
Reporting is presented by the Government Finance Officers
Association ofthe United States and Canada to
government units and public employee retirement
systems whose comprehensive annual financial
reports (CAFRs) achieve the highest
standards in government accounting
and financial reporting.
President
Executive Director
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CITY OF PADUCAH, KENTUCKY
FINANCIAL SECTION
COMPREHENSIVE ANNUAL FINANCIAL REPORT
YEAR ENDED JUNE 30, 2012
J. DAVID BAILEY. Ill
C. SUZETTE CRONCH
ROGER G. HARRIS
MICHAEL F. KARNES
ROBERT R. ROBERTSON
MARK A. THOMAS
G. LEON WILLIAMS. 1926-2004
H. WILLIAM LENTZ. 1925·2007
J. RICHARD WALKER
JERRY G. SEVERNS
WILLIAMS, WILLIAMS & LENTZ, LLP
CERTIFIED PUBLIC ACCOUNTANTS
601 JEFFERSON
PADUCAH,KENTUCKY42001
Independent Auditor's Report
Honorable William F. Paxton, Mayor
Members of the Board of Commissioners
City of Paducah
Paducah, Kentucky
MAILING AQQRESS
POST OFFICE BOX 2500
PADUCAH. KY 42002·2500
~ 27().443.3643
EM
270-444-0652
We have audited the accompanying financial statements of the governmental activities, the business-type
activities, the aggregate discretely presented component units, each major fund, and the aggregate remaining
fund information of the City of Paducah, Kentucky (the City), as of and for the year ended June 30, 2012,
which collectively comprise the City's basic financial statements as listed in the table of contents. These
financial statements are the responsibility of the City of Paducah, Kentucky's management. Our responsibility
is to express opinions on these financial statements based on our audit. We did not audit the financial
statements of the Transit Authority of the City of Paducah, a component unit, which represents fourteen
percent of the assets and revenues of the Component Units column. Those financial statements were audited
by another auditor whose reports have been furnished to us; and, our opinion on the basic financial statements,
insofar as it relates to the amounts included for the Transit Authority of the City of Paducah, a discretely
presented component unit, is based on the report of another auditor.
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 basic financial statements are free of material misstatement.
An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial
statements. An audit also includes assessing the accounting principles used and significant estimates made by
management, as well as evaluating the overall basic financial statement presentation. We believe that our
audit provides a reasonable basis for our opinions.
In our opinion, based on our audit and the report of another auditor, the financial statements referred to above
present fairly, in all material respects, the respective financial position of the governmental activities, the
business-type activities, the aggregate discretely presented component units, each major fund, and the
aggregate remaining fund information of the City of Paducah, Kentucky as of June 30, 2012, and the
respective changes in financial position and cash flows, where applicable, thereof and the respective budgetary
comparisons for the General Fund and Special Revenue Investment Fund, for the year then ended in
conformity with accounting principles generally accepted in the United States of America. In addition, in our
opinion, the financial statements referred to above present fairly, in all material respects, the respective
financial positions of each nonmajor governmental, nonmajor enterprise, internal service, and fiduciary fund,
which collectively comprise the City's combining and individual fund statements and schedules as listed in the
table of contents as of June 30, 2012, and the respective changes in financial position and cash flows, where
applicable, thereof and the respective budgetary comparisons for the General Capital Improvements, Debt
Service Fund, and the non-major governmental funds, for the year then ended in conformity with accounting
principles generally accepted in the United States of America.
-I 1-
In accordance with Government Auditing Standards, we have also issued our report dated December II, 20I2,
on our consideration of the City's internal control over financial reporting and 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 the internal control over financial reporting or on
compliance. That report is an integral part of an audit performed in accordance with Government Auditing
Standards and should be considered in assessing the results of our audit.
Accounting principles generally accepted in the United States of America require that the management's
discussion and analysis and Pension Trust Fund Schedules on pages I3 through 27 and 9I, be presented to
supplement the basic financial statements. Such information, although not a part of the basic financial
statements, is required by the Government 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.
Our audit was conducted for the purpose of forming opinions on the financial statements that collectively
comprise the City of Paducah, Kentucky's basic financial statements. The introductory section and statistical
tables are presented for purposes of additional analysis and are not a required part of the basic financial
statements. The accompanying schedule of expenditures of federal awards is presented for purposes of
additional analysis as required by U.S. Office of Management and Budget Circular A-I33, Audits of State,
Local Governments, and Non-Profit Organizations, and is also not a required part of the basic financial
statements of the City of Paducah, Kentucky. The schedule of expenditures of federal awards has been
subjected to the auditing procedures applied in the audit of the basic financial statements and, in our opinion, is
fairly stated in all material respects in relation to the basic financial statements taken as a whole. The
introductory and statistical sections have not been subjected to the auditing procedures applied in the audit of
the basic financial statements and, accordingly, we do not express an opinion or provide any assurance on
them.
kl~ 6(/..://. 1'-~ jJ / ~ (/' Z::z.
December II, 2012 '
-I2-
CITY OF PADUCAH, KENTUCKY
REQUIRED SUPPLEMENTARY INFORMATION
COMPREHENSIVE ANNUAL FINANCIAL REPORT
YEAR ENDED JUNE 30, 2012
CITY OF PADUCAH, KENTUCKY
MANAGEMENT'S DISCUSSION AND ANALYSIS
JUNE 30, 20I2
The City of Paducah ("City") offers Management's Discussion and Analysis to provide a narrative overview
and analysis of City financial activities for fiscal year ended June 30, 20 I2. To fully understand the entire
scope of the City's financial activities, this information should be read in conjunction with the letter of
transmittal (pages I-7) and the basic financial statements (pages 28-90) provided in this document.
The City first implemented Government Accounting Standards Board Statement 34, Basic Financial
Statements -and Management's Discussion and Analysis -for State and Local Governments, for fiscal year
2003.
I. Financial Highlights
• Assets exceeded liabilities by $48.2 million at the close of the 20II-20I2 fiscal year. Of this
amount, $9.2 million (unrestricted net assets) may be used to meet City government's ongoing
obligations to citizens and creditors.
• Total net assets decreased $I,564,09I.
• At fiscal year end, City governmental funds reported a combined ending fund balance of $I7.4
million. Approximately 23% of this total amount, $4.I million, is restricted or committed for
highways/streets and capital improvements. Assigned fund balance comprises II%, or $2 million,
of combined fund balance; the majority of which is set aside for capital improvements.
• At the end of the current fiscal year, unassigned General Fund fund balance was $II.3 million and is
available for spending at the City's discretion. Cash makes up approximately $7.7 million. When
compared to actual total appropriations, the General Fund cash balance is 24.6%.
II. Overview of Financial Statements
This discussion and analysis serves as an introduction to the City's basic financial statements, which
consist of four components: I) government-wide financial statements, 2) fund financial statements, 3)
component unit financial statements, and 4) notes to the financial statements. This report also contains
other supplementary information in addition to the basic financial statements.
A. Government-Wide Financial Statements
Government-wide financial statements are designed to provide readers with a broad overview of
City finances in a manner similar to private-sector business.
The Statement of Net Assets presents information on all City assets and liabilities, with the
difference between assets and liabilities reported as net assets. Monitoring increases and/or
decreases in net assets over time may serve as a useful indicator of whether the financial position of
the City is improving, stagnating, or deteriorating.
The Statement of Activities presents information showing how the City's net assets changed during
the fiscal year. All net asset changes are reported as soon as the underlying event giving rise to the
change occurs regardless of the timing of related cash flows. Revenues and expenses are reported in
the Statement of Activities for some items that will only result in cash flows in the future (e.g.,
uncollected taxes and earned but unused vacation leave).
Both of the government-wide financial statements distinguish City functions that are primarily
supported by taxes and intergovernmental revenues (governmental activities) from other City
-I3-
functions that are intended to recover all or a significant portion of their costs through user fees and
charges (business-type activities). City governmental activities include general government, public
safety, public service, park and recreation, planning and development, and interest on long-term
debt. Business-type activities of the City include Solid Waste, Section Eight Housing, Civic Center,
and Telecommunication Information System Authority (TISA).
Government-wide financial statements include not only the City (the primary government), but also
a legally separate Paducah Water Works and Paducah Transit Authority (component units) for which
the City is financially accountable. Financial information for the component units is reported
separately from the financial information presented for the primary government itself.
The government-wide financial statements can be found on pages 28-31 of this report.
B. Fund Financial Statements
A fund is a grouping of related accounts that is used to maintain control over segregated resources
for specific activities or objectives. The City of Paducah, like other state and local governments,
uses fund accounting to ensure and demonstrate compliance with finance-related legal requirements.
City funds can be divided into three categories:
I) Governmental Funds. Governmental funds are used to account for essentially the same
functions reported as governmental activities in the government-wide financial statements. Unlike
government-wide financial statements, however, governmental fund financial statements focus on
current sources and uses of spendable resources, as well as on balances of spendable resources
available at the end of the fiscal year. This information may be useful in evaluating a city's near-
term financing requirements.
The City maintains eleven ( 11) individual governmental funds. Information is presented separately
in the governmental fund balance sheet and in the governmental fund statement of revenues,
expenditures, and changes in fund balances for the General, General Capital Improvements,
Investment, and Debt Service Funds, all of which are considered to be major funds. Data from the
other seven (7) funds are combined into a single, aggregated presentation. Individual fund data for
each of these non-major governmental funds is provided in the form of combining and individual
fund statements elsewhere in this report on pages 92-104.
Readers may better understand the long-term impact of the City's near-term financing decisions by
comparing the narrow-focus governmental funds financial statements with governmental activities
in the government-wide financial statements. Exhibit 4 (pages 34-35) and Exhibit 6 (pages 38-39)
provide a reconciliation to ease comparison between the fund financial statements and the
government-wide statements.
The basic governmental fund financial statements can be found on pages 32-39 of this report.
2) Proprietary Funds. The City maintains two types of proprietary funds:
a. Enterprise Funds. Enterprise funds are used to report the same functions presented as
business-type activities in the government-wide financial statements and are used to account
for operations:
• That are financed and operated in a manner similar to private business enterprises where
the intent of the governing body is that the costs of providing goods and services to the
general public on a continuing basis be financed or recovered primarily through user
charges; or
-14-
• Where the governing body has decided that periodic determination of revenues earned,
expenses incurred, and/or net income is appropriate for capital maintenance, public
policy, management control, accountability, or other purposes.
The City uses four enterprise funds to account for Solid Waste, Section Eight Housing,
Civic Center, and TISA, as well as certain component units that provide water and public
transit. TISA and Civic Center receive subsidy from the General Fund.
The City's component unit enterprises include the Paducah Water Works and Paducah
Transit Authority, which provide water and public transportation. These component units,
each of which has their own board of directors, are also enterprise funds and are shown on
pages 52-55.
b. Internal Service Funds are used to accumulate and allocate costs internally among the
City's various functions. The City uses internal service funds to account for fleet services,
fleet replacement, risk management (insurance), and employee health programs. Internal
service funds have been allocated between governmental activities and business-type
activities in the government-wide financial statements based on revenue earned.
Proprietary funds provide the same kind of information as government-wide financial
statements, but in greater detail. Individual data for the nonmajor proprietary funds is presented
in the form of combining statements on pages I 05-1 07 of this report. Individual data for the
internal service funds is likewise presented in the form of combining statements on pages 1 08-
11 0 of this report.
3) Fiduciary Funds. Fiduciary funds are used to account for resources held for the benefit of
parties outside the government and are not reflected in government-wide financial statements
because those resources are not available to support City programs. Individual data for the
City's four (4) fiduciary funds (Appointive Employees' Pension, Police and Firefighters'
Retirement, Other Trust Funds, and Maintenance and Rehabilitation Trust) are presented in the
form of combining statements on pages 111-114 of this report.
C. Notes to the Financial Statements
The notes provide additional information that is essential to fully understanding data provided in the
government-wide and fund financial statements. Notes to the financial statements can be found on
pages 56-90 of this report.
D. Other Information
In addition to basic financial statements and accompanying notes, this report also presents certain
required supplementary information concerning City funding of its obligation to provide pension
benefits to its employees and budgetary comparison schedules for the general and major special
revenue funds.
The combining statements referred to earlier in connection with nonmajor governmental funds,
nonmajor proprietary funds, internal service funds, and fiduciary funds are presented immediately
following the required supplementary information on pensions and budgetary comparisons.
Combining fund statements and schedules can be found on pages 94-114 of this report.
-15-
lll. Government-Wide Financial Analysis
As noted earlier, net assets may serve over time as a useful indicator of the City's financial position.
City assets exceeded liabilities by $48.2 million as of June 30, 2012.
For FY2012, the largest portion of the City's net assets (69%) reflects its investment in capital assets
(i.e., land, buildings, machinery, equipment, and infrastructure) less outstanding related debt used to
acquire those assets. The City uses these capital assets to provide service to citizens and, as a result,
these assets are not available for future spending. The City's capital assets investment is reported
net of related debt, but the resources to pay this debt must be provided from other sources since the
capital assets cannot be used to liquidate the liabilities.
An additional portion of City net assets ( 12%) represents resources that are subject to external
restrictions on how they may be used. The remaining balance of unrestricted net assets ( 19%) may
be used to meet the City's ongoing obligations to citizens and creditors.
As of June 30, 2012, the City reports positive balances of net assets, both for the government as a
whole, as well as for its separate governmental and business-type activities.
Current assets
Capital assets
Other noncurrent assets
Total assets
Current liabilities
Noncurrent liabilities
Total liabilities
Net assets:
Invested in capital assets,
net of related debt
Restricted
Unrestricted
TOTAL NET ASSETS
City of Paducah, Kentucky
Net Assets
June 30
Governmental Activities
2012 2011
$36,580,489 $36,714,968
39,740,080 40,927,948
7.186.182 7.715.136
83.506.751
10,296,274
30.335.518
40.631.792
31,957,381
5,003,581
5.913.997
$42 824 252
85.358.052
11,727,758
29.242.431
40.970.189
32,905,977
7,252,385
4.229.501
$44 382 863
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Business-Type Activities
2012 2011
$6,529,327 $6,555,797
1,308,574 1,334,230
7.837.901
473,276
2.076.914
2.550.190
1,308,574
732,817
3.246.320
$5 282 21]
7.890.027
475,439
2.075.690
2.551.129
1,334,230
999,885
3.004.783
$5 338 828
Total Primary Government
2012 2011
$43,109,816 $43,270,765
41,048,654 42,262, I 78
7.186.182 7.715.136
91.344.652
10,769,550
32.412.432
43.181.982
33,265,955
5,736,398
9.160.317
$48 162 620
93.248.079
12,203,197
31 318.121
43.521.318
34,240,207
8,252,270
7.234.284
$42 226 261
The exhibi t below c harts the City's tota l net assets from th e implementation of GASB 34 through
the present.
60
... 50 ~ 40 ~ = -30
20
10
0
... ......
Government Wide Analysis
Total Net Assets
.....
~
~
2003 2004 2005 2006 2007 2008 2009 2010 2011 2012
A nnu a l increases to total net assets began in FY2005 primarily due to the increase of the City's
pay ro ll tax an d the creation of the Inve stment Fund. The add itio na l tax generates approxim ate ly $4
milli o n in revenue each year, w hich is used mostly for capita l investm e nt. Increases h ave leveled
off in recent years due to mid-year appropriati ons made by t he Comm ission, reducing the City's
unreserved cash balance at J un e 30 to t he minimum requirement of 8% each time. In FY2012, net
assets declined by $1.5 mi lli on . This was due to a commitment made by the City to contribute
toward the construction of a n edu catio nal facil ity to be occupied by Murray State University. In
November 20 II, t he C ity e nte red into a ge neral ob li gation note in the amount of $2.7 mill ion with
McCracken County, w ho is managing the p roject and wi ll own the building as it is leased to the
University. Because t he Coun ty is retaining the asset, th is transaction is reflected as an expense on
the government-wid e financial statements.
A. Analysis of the City's Operations
The follow in g table provides a su mmary of the City's operations for the years ended June 30, 2012
and 20 II. Governm ental activities decreased t he C ity 's net assets by $1,5 12 ,904. B us iness-type
acti v it ies decreased the C ity 's net assets by $5 1,187.
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City of Paducah, Kentucky
Changes in Net Assets
June 30
Governmental Activities Business-T):(!e Activities Total Primaa Government
Revenues: 2012 2011 2012 2011 2012 2011
Program revenues:
Charges for services $ 3,128,991 $ 3,177,615 $4,570,982 $4,648,702 $ 7,699,973 $ 7,826,317
Operating grants/contributions 2,215,247 2,086,625 1,647,981 2,400,540 3,863,228 4,487,165
Capital grants/contributions 533,169 1,767,093 15,266 8,659 548,435 1,775,752
General revenues:
Property taxes 4,267,812 4,402,226 4,267,812 4,402,226
Franchise taxes 150,974 140,570 150,974 140,570
Telecommunications tax 710,951 752,147 710,951 752,147
Insurance premium tax 3,690,806 3,476,309 3,690,806 3,476,309
Vehicle tax 614,786 598,509 614,786 598,509
Bank tax 216,829 218,137 216,829 218,137
Gross receipts license tax 4,359,835 4,243,511 4,359,835 4,243,511
Employee license tax 18,095,182 17,345,033 18,095,182 17,345,033
Other taxes 677,409 524,878 677,409 524,878
Intergovernmental revenue 340,975 478,576 340,975 478,576
Unrestricted investment
earnings 203,261 264,913 48,806 46,052 252,067 310,965
Gain on sale of capital assets 36,718 62,539 2,443 67,657 39,161 130,196
Insurance recoveries 27448 410.462 27.448 410.462
Total revenues 39.270.393 39.949.143 6.285.478 7.171.610 45.555.871 47.120.753
Expenses:
General government 12,937,997 9,786,052 12,937,997 9,786,052
Public safety 17,045,731 18,475,971 17,045,731 18,475,971
Public service 6,163,602 7,328,806 6,163,602 7,328,806
Park and recreation 2,654,098 2,748,333 2,654,098 2,748,333
Planning and development 1,192,952 1,212,103 1,192,952 1,212,103
Interest on long-term debt 1,059,537 1,363,580 1,059,537 1,363,580
Solid Waste 3,900,264 3,832,130 3,900,264 3,832,130
Section Eight Housing 1,921,004 1,956,728 1,921,004 1,956,728
Civic Center 71,069 76,546 71,069 76,546
TISA 173.708 183.546 173.708 183.546
Total expenses 41.053.917 40.914.845 6.066.045 6.048.950 47.119.962 46.963.795
Increase (decrease) in net
assets before transfers ( 1 '783,524) (965,702) 219,433 1,122,660 (1,564,091) 156,958
Transfers 270.620 (125.772) (270.620) 125.772
Change in net assets (1,512,904) (1,091,474) (51,187) 1,248,432 (1,564,091) 156,958
Net assets, July 1 44.387.863 45.479.337 5.338.898 4.090.466 49.726.761 49.569.803
NET ASSETS, JUNE 30 $42 814 252 $44 381863 $5 281111 $5 338 828 $48 162 610 $42126161
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B. Governmental Activities
As with most municipaliti es, th e C ity's governm enta l activ iti es are heav il y s ub sidized by taxes, w ith
little or no program revenue for each function. T he c hart below demonstrates t he importance of tax
revenu e to essentia l function s of the City.
SIS
$16
S14
S12
"' SIO c:
0
~ ::; S8
S6
S4
S2
so
Governmental Activities
Expenses and Program Revenues
General Public safety Public sen1ce Park & Planning & Interest on
Government recreation development long-term debt
The g raph b e low depicts the breakdown of revenue by source for fi scal year 2012.
Governmental Activities Revenue by Source
Capital Grants/
Contribntlons
1%
Other Ta.xes ---------:::;?..:::iiil
6%
Operating Grants/
Contributions
6%
Charges for
Services
8%
Property
11 %
<1%
Occupational
Licenses
In fi scal year 20 12, t he C ity deri ved 84% of its revenu e from ta xes/li censes. Occupational li censes,
w hi c h include payro ll w ithho ldin g tax, bus in ess li censes, and insurance premium tax , is the largest
sourc e of income to the City, totaling $26.1 milli o n . This category of re venu e in creased 4.3% fro m
-19-
fi sca l year 2 0 I I. In su ra nce pre m i urn t ax experie nced t he largest chan ge percentage-w ise with in th is
cat egory w ith an in crease of $2 14 ,497, o r 6 .2%. T hi s is t he fir st time in s urance prem iu m taxes h ave
in c reased over th e pr io r year s ince FY20 08. It is beli eved t hat economi c recovery may be d riv in g
th e in crease . Altho ug h C ity staff is ho pefu l t hi s revenu e source w i ll cont in ue to g row, receipts are
s til l over a mi ll io n d o ll a rs b e low FY20 08 levels, and FY2 0 13 bud get est imates fo r this revenue type
are very cons ervative t o re fl ect t he un ce1ta inty. E m p loyee li cen se tax increased $750,149, o r 4.3%,
from th e p ri or year. The in crease in em pl oyee l icense tax does not appear to be t h e result of o ne
s ig ni fica nt e mp loyer 's activ ity, b ut t he resu lt of several employer s hav in g m oderate increases.
Property t axes cont inue t o be a st a b le source of revenue , com prisin g I I % of tota l r evenue in both
FY20 12 a nd FY2 011.
C. Busin ess-Type Activities
T he c ha rt below shows t he o perating results fo r each of t he City 's business-type activ ities. T hese
act ivit ies s h o uld break-even; that is, the c harges for services should be large enough t o s usta in
o perations. For fisca l year 2012, bu s in ess-ty pe activ iti es as a whole had a d ecre ase in net assets of
$5 1,187. The So lid W aste Fund o nce again ha d a positi ve c hange in n et asset s, a lthoug h it was
s ig nifi cantly less th a n t he previo us t hree years. T hi s is because th e Solid Waste transferred
a pproxim a t e ly $250,000 to t he Gen e ra l Fu nd . T he Ph ase II S t o rm Water Act re q u ires that the C ity
ma ke a n effort to c urb soli d waste fro m th e landfi ll /sewer system . As a resu lt, t hree f ull t im e street
sweepe rs a nd e ig h tee n ROWs (one d ay a week) have been ass igned to this progra m . Because t hese
are Genera l F und em pl oyees, the So lid Waste Fund is m aking m onthl y interfund transfers to t he
General Fund to compe nsate fo r t h e ir use. Analys is of t he remain ing business-type activities is
in c luded in Secti o n TV -B of this re p o rt .
5.00
4.50
4.00
3 .50
e 3 .00 C> ~ 2.50
2 .00
1.50
1.00
0 .50
Business-Type Acrtvlrtes
Expenses and Revenues
Solid Wast e Secti on Eight Chic Center TISA
Housing
IV. Financial An alys is of t he C ity 's F unds
A. G overnmen tal F unds
..J Expenses
•R evenues
T he focus of the C ity's governmental f unds is t o provide in formation on near-term in flows , o utflows
a nd ba lances of spenda bl e resources. S uch inform atio n is u sefu l in determi ni ng th e City's financing
requiremen ts. Unreserved fun d ba lance serves as a useful measu re of the City's net resources
avai lab le fo r s p e nd in g at t he end of th e fi s ca l year.
-2 0-
At the end of the fiscal year, the C ity governmental funds reported combined ending fund balances
of $17.4 million. In FY 20 II , the City implemented GASB Statement No. 54, Fund Balance
Reporting and Governmental Fund Type D efinitions. T he redefined categorie s of fund balance are
described below:
• Restricted fund balance h as externa l limitat io ns o n use that may be imposed by cred itors,
g rantors, contribu tors, or laws and regulations . At the end of the fiscal year, the City had
$1,156,681 of municipal aid fund s , whic h are restricted in use for paving by t he St a te of
Kentucky.
• Co mmitted fund balance ha s s elf-imposed limitation s enacted by the highest level of decision
making that requires formal action at the same leve l to remove the limitations. The C ity had
$2,631 ,23 3 in fund balance committed fo r capital im provements in the Investment Fund.
• Assigned fund balance has limitations res ultin g from intended use; formal action is not
requ ired. Approximately II % of the C ity's fund balance is assigned for various purposes,
including capital improvements, publi c safe ty , a nd debt serv ice.
• Unassigned fund balance is the total f und balance in the ge neral fu nd in excess of the other
fund balance categori es.
Governmental Funds Ending Fund Balance
Restricted for
Highways and
Streets
7%
Restricted for
PubUc Safety
<1 o/o R estricted for
<1%
Capital
Committed for
Capital
Improvements
15%
A pproxim ately 65% of tota l fund balance, $1 1.3 milli on is una ss igned General Fund fund balance,
which is available for spend in g at t he governme nt 's d iscretion but o nl y up to the a mount represented
by cash. At year-end , there was $7.7 milli o n available as cash ; the balance is tied up in other assets
including acco un ts receivable and property ta xes co ll ectible. C ity fiscal po licy (O rdin ance 201 1-6-
7825) requires that an amount not less than 8% of the General Fund's budgeted exp e nditures re main
undesign ated in t he f und balance, o r $2.5 milli o n, which leaves $8.8 milli o n as unreserved for fi scal
y ea r 2012.
As a measure of Genera l Fu n d li q ui dity, readers may com pare un ass igned (formerly re ported as
"unreserved") f und b a la nce to tota l General Fund expenditures. U nassigned Genera l Fund fund
b a lance represents 36.2% of exp e nditures and t ran sfe rs o ut ($3 1.2 mill ion). T hi s has remained
s tabl e s in ce th e implementati o n of GASB 34, as i llu strate d in th e tab le be low.
-21-
40.00%
35.00%
30.00%
25.00%
20.00%
15 .00%
10.00%
5.00%
0.00%
General F und
Fund Balance as a % of Expenditures
.. ...... ...
'""-... ...... ...,.,-~ ~
2003 2004 2005 2006 2007 2008 2009 2010 2011 20U
The Investment Fu nd had a fund balance of $2 .6 m i llion, all of w hich is committed for capita l
projects. The Investme nt Fund w as a uthorized by the C ity Commissio n in fi scal yea r 2005-2 006 as
a spec ial re venue fund w hose use is re stricted to property tax reduction , economic deve lopment,
community re deve lo pm ent, a nd capital and infrastructure proj ect s . The Investment Fund captures
a ll manne r o f financial activities re lated t o revenu e fro m the Y2 cent payro ll tax increase, effective
October I , 2 00 5. The In vestm e nt Fund 's fund balance in c reased $4 4 tho u sand from prior year to
$2.63 milli o n . Revenu e in creased as antic ipated a nd was s ufficient t o f und th e budge ted projects for
FY20 12. For FY20 12, jus t a few of those proj ects in c lud e d : econ o mic in centi ves fo r the relocation
of Paducah & Louisville Ra ilway nationa l headqua rters faci lity ; continued s upport o f economic
d eve lopme nt agenc ies s uc h a s Greater Paduca h Economi c Development Corp. a nd Entre-Pa ducah;
debt service payments o n econom ic d evelo pm e nt a nd capita l proj ects ; community d evelopment in
the Fountain A venue Di s trict; a nd resurfacing a nd s id ewalk prog rams.
Fund bala n ce in the Gene ra l Capital Improve me nts fund decreased by approx imate ly $92 th o usand
fro m the prior year to $1.49 milli on. The decrease is due to the utilization of do ll a rs that had been
set aside in prev io u s years. Capi ta l improve me nt projects for th e year are d iscussed in Section IV-A
of this report.
B. Proprietary F u nds
The C ity 's proprietary funds provid e the same info rmation found in the governm e nt-w id e fin a nc ial
st at e ments, but in more d eta i l.
Net assets of the re s pecti ve p roprietary fund s are:
So lid Waste
Section E ig ht Hous in g
C iv ic Center
TIS A
$ 3 ,682 ,713
745 ,469
16 4 ,547
309 ,5 94
Combined total ne t asset c ha nge for the four funds was a decrease of $85 ,289, broken down as
follows: Sol id Was te ($322 thousand in crease), Secti o n E ig ht Housing ($273 t ho usand decrease),
C iv ic Center ($1 0 tho usa nd d ecrease), and TISA ($124 thousand decrease). The largest pro prietary
fund , So l id Was te , was di scu ssed under B us ine ss Type Activities (Section III-C). Section Eight ha d
-22-
successfully reduced program expenditures over the past few years to replenish reserves. However,
in FY20 12, there was a nationwide HUD recapture effort to reduce housing agency reserves down to
an acceptable national average. TISA also experienced a significant loss in FY2012. In mid-fiscal
year 2012, TISA's largest partner other than the City, McCracken County, left the agency. Because
there is now minimal external revenue flowing into the fund, this fund is in the process of being
dissolved. For FY2013 budget projections, user charges have been eliminated and expenditures
were folded into the City's Information Systems Department.
V. General Fund Budgetary Highlights
Differences between the original budget and the final budget resulted in a $560 thousand increase in
appropriations and can be briefly summarized as follows:
Department
General Administration
Finance
Planning
Human Rights
Inspection
Information Systems
Risk Management
Police
Fire
Public Works
Engineering Services
Recreation
PRDA
Other
Appropriations
Increase Decrease
(In Thousands)
$ $ 241
5
1,500
345
39
26
93
55
6
277
329
49
167
8
Appropriations for the Fire Department increased $1.5 million. A lawsuit was filed against the City
of Paducah under Wage and Hour Law that affected 71 former and current frrefighters named as
Plaintiffs, relating to the way the City administered State Incentive Overtime Pay for the five years
preceding filing of the lawsuit. Based on the court's rulings that were entered in April and
September 201 I, the City's liability in this lawsuit was established at $1,482,743. This payout,
which included back pay and related payroll expense and interest, along with $121,854 in awarded
attorney fees were paid out during FY20 12.
There was a $241 thousand decrease to appropriations for General Administration. Commission
contingency funds in the amount of $250,000 were transferred out of General Administration for
various projects during the year. This also explains the increase in appropriations for "Other",
which is primarily composed of the inter-fund transfers to those projects.
Police, Public Works, and Recreation experienced decreases in excess of $100 thousand. These
decreases in appropriations were due to significant salary slippage in these departments.
-23-
VI. Capital Asset and Debt Administration
A. Capital Assets
The City's investment in capital assets for governmental and business-type activities as of June 30,
2012, is $41 million (net of accumulated depreciation). This investment in capital assets includes
land, buildings and improvements, vehicles and equipment, park facilities, roads, highways, and
bridges, and construction in progress.
Capital improvements are included in each department budget until improvements are completed.
At the end of the fiscal year, completed projects are capitalized in the Government-wide Statements.
During fiscal year 2012, projects and equipment expenditures totaled approximately $1.6 million.
Some of the largest capital-type projects, in terms of dollars in fiscal year 2012, are shown in the
following table:
Vehicle Purchases
Pumper Truck (not included in vehicle purchases above)
·Paducah & Louisville Railway Parking Lot
Compost Yard Improvements
$692,889
407,509
190,369
125,573
In the upcoming years, several street, economic development, riverfront development, quality of life
and drainage projects will continue and are estimated to cost several million dollars. Capital
improvement projects including infrastructure, recreational facility improvements, continued
neighborhood revitalization, and street and sidewalk rehabilitation are among the projects to be
addressed.
Land
Land improvements
Construction in progress
Buildings and improvements
Infrastructure
Equipment
Furnishings and fixtures
Vehicles
TOTALS
City of Paducah, Kentucky
Capital Assets
(Net of Accumulated Depreciation)
June 30
Governmental Activities Business-Tiue Activities
2012 2011 2012 2011
$11,107,875 $ 7,394,561 $ 62,152 $ 62,152
1,902,527 1,643,180
3,797,562 7,150,928
4,910,512 5,251,215 316,061 205,306
13,349,077 14,990,871
1,788,200 2,003,441 331,189 372,097
1,522 2,556
2.882.805 2.491.196 599.172 694.675
$32 740080 $40 221248 $1 308 514 $1 334 230
Total Primaa Government
2012 2011
$11,170,027 $ 7,456,713
1,902,527 1,643,180
3,797,562 7,150,928
5,226,573 5,456,521
13,349,077 14,990,871
2,119,389 2,375,538
1,522 2,556
3.481.977 3.185.871
$4) 0~8 65~ $42 262 118
Additional information on City capital assets can be found in Note 3 in the notes to financial
statements on pages 70-73.
-24-
B. Long-Term Debt
At year-end, the City had $33,000,039 in outstanding bonds, accrued compensated absences, and
notes payable, compared to $3I, 720,403 at June 30, 20 II with maturities extending through 203I.
Kentucky League of Cities -2003
Infiniti Media Building-2004
General Fund accrued compensated absences
Police/Firefighter Pension Fund Liability -2006
Floodwall Rehabilitation -2008
Convention Center Renovation -2008
Public Improvement Projects -20 I 0
Refinanced Convention Center-20 I 0
Margaret Hank Agreement -20 II
Refinanced lnfiniti Media Building-20 II
Murray State University Agreement-20 II
TOTALS
During the year, the City had two new debt issues:
Governmental Activities
2012 2011
$ 2,I93,730 $ 2,358,I7I
2,028,2I8
4,895,000
2,455,2IO
2,276,250
6,IOO,OOO
6,630,000
I76,255
3,57I,283
2.674,093
3,780,000
I,929,7I2
5,I25,000
2,564,948
2,364,039
6,370,000
7,040,000
I88,533
$33.000.039 $3I .720.403
Infiniti Media Building-Refinance. In August 20II, a $3.9I million bond obligation was issued
to advance refund $3.78 million of outstanding 2004 series bonds. The 2004 bonds were issued to
finance the construction of the lnfiniti Media Building in the Paducah Industrial Park West. The
previous agreement with McCracken County was renewed: 50% of the principal amount of the
bonds was issued on behalf of McCracken County, Kentucky.
Murray State University Agreement. In November 20II, the City entered into a general obligation
note in the amount of $2,674,093 with McCracken County to finance the construction of an
educational facility to be occupied by Murray State University.
Debt issues prior to July I, 20II are described below:
Convention and Performing Arts Center -Refinance. In August 20 I 0, a $7 .I65 million general
obligation was issued to advance refund $6.725 million of outstanding 200 I series bonds. The 200 I
bonds were issued to finance construction of the Luther F. Carson Four Rivers Center for the
Performing Arts and the expansion of the Julian Carroll Convention Center. The previous agreement
with McCracken County was renewed: 50% of the principal amount of the bond was issued on
behalf of McCracken County, Kentucky, and the County has issued the City a general obligation note
in a principal amount equal to 50% of the principal amount of the bonds.
Margaret Hank Building Agreement. In June 20II, the City entered into an agreement in the
amount of $I88,533 with Margaret Hank Memorial Cumberland Presbyterian Church to finance the
acquisition of real property to be used for the development of an indoor recreational facility.
Public Improvement Projects. In March 20 I 0, a $6.645 million general obligation was issued to
finance several public improvement projects including a major park parking lot renovation and
several resurfacing projects, sports park property acquisition, pavilion acquisition, greenway trail
development, and a portion of the hotel purchase described earlier in this document.
Floodwall Rehabilitation. In March 2009, a $2.8 million general obligation was issued to finance
significant repairs to the City's 60-year-old floodwall. The first stage of a $6 million project, this
money was used to fund the relining of the pipes, which have deteriorated with age.
-25-
Convention Center Renovation. In March 2009, McCracken County entered into an agreement in
the amount $5,000,000 with the Kentucky Association of Counties to finance renovations to the
Julian Carroll Convention Center. The note was issued by McCracken County; however, the City is
obligated for SO% of the principal amount through an Interlocal Cooperative Agreement between the
City and McCracken County.
Kentucky League of Cities. In fiscal year 2003, the City borrowed $3.5 million to fund a variety of
capital projects, including park improvements ($1.0 million), downtown infrastructure improvements
in conjunction with the FRC ($1.5 million), and City Hall, Police, and other City-owned facility
improvements ($1.0 million).
Infiniti Media Building. In fiscal year 2004, the City sold $5.0 million in bonds to construct the
lnfiniti Media Building in the Paducah Industrial Park West, an economic development project. By
interlocal agreement, McCracken County is obligated to an amount equal to 50% of the principal
amount of the bonds. After the third year of the life of the bond, the Infiniti Media Company is
obligated to make monthly lease payments to the City in an amount nearly equal to the debt service
obligation.
Police/Firefighter Pension Fund Liability. In fiscal year 2006, the City issued $6.1 million in
general obligation bonds to finance the police and firefighter's pension fund estimated pension
liability.
The City's legal debt limit under § 1 58 of the Kentucky Constitution is 1 0% of total assessed value of
taxable property in Paducah; therefore, the debt limit is $212,207,634. The City's latest bond rating
by Standard & Poor's is AA-. The City has a low amount of general obligation debt, which explains
our large legal debt margin.
The City of Paducah, Kentucky, issues and incurs debt in order to fund capital improvement projects,
purchase major capital equipment and facilities, and respond to other special funding needs. In fiscal
year 20 12, less than 2% of the General Fund budget was expended for debt service and, thus, has
minimal impact on current and future operations.
Additional information on the City's long-term debt can be found in Note 3 in the notes to financial
statements on pages 74-78.
VIT. Other Potentially Significant Matters.
A. Post-employment Benefits. Personal service costs make up over two-thirds of the City's annual
operating budget and that number is continuously affected by rising retirement costs. In the past
five years, the City's combined hazardous and non-hazardous retirement matching contribution has
increased from approximately $3.6 million in fiscal year 2008 to $4.1 million in fiscal year 2012.
The rates for FY20 13 have increased; combined with wage adjustments, this increase caused
budgeted figures for the upcoming year to increase another $372,000 compared to what was
incurred in FY20 12. The figures above do not include the $166,000 in one-time matching
contribution funds paid in FY20 12 as a result of the firefighter lawsuit. Based on trends and
projections provided by the Retirement System, the long-term outlook on funding requirements is of
utmost concern.
B. Police & Fire Pension Fund (PFPF) Unfunded Liability. In fiscal year 2006, the City issued $6.1
million in general obligation bonds to eliminate the unfunded pension liability. With the sharp
decline in value of the national stock market in 2009, the PFPF's equity investment dropped
accordingly. PFPF net assets dropped in 2009 by nearly $3.5 million, or 28.5%, of the beginning net
assets (July 1, 2008). Since the 2009 drop, the City has contributed approximately $400,000
annually to meet the actuary's recommended amount toward the unfunded pension liability. The
valuation as of July 1, 2012 indicates the amount for FY 2013 will be $462,154.
-26-
VIII. Requests for Information
This financial report is designed to provide a general financial overview for those interested in the City
of Paducah government finances. Questions or requests for additional financial information may be
addressed to Jonathan Perkins, Finance Director, City of Paducah, 300 South 5th Street, Paducah, KY
42001.
-27-
CITY OF PADUCAH, KENTUCKY
BASIC FINANCIAL STATEMENTS
GOVERNMENT-WIDE FINANCIAL STATEMENTS
COMPREHENSIVE ANNUAL FINANCIAL REPORT
YEAR ENDED JUNE 30, 2012
THIS PAGE INTENTIONALLY LEFT BLANK
Exhibit 1
CITY OF PADUCAH, KENTUCKY
STATEMENT OF NET ASSETS
JUNE 30, 2012
ASSETS Primary Government
Governmental Business-type Component
Current Assets: Activities Activities Total Units
Cash and cash equivalents $15,056,163 $4,590,124 $19,646,287 $ 2,260,737
Investments 3,050,000 900,000 3,950,000
Receivables, net:
Notes 1,116,375 1,116,375
Lease 207,054 207,054
Accounts 5,780,088 550,157 6,330,245 674,531
Grants 222,077 95,569 317,646 558,266
Interest 50,469 8,089 58,558
Property tax 4,676,187 4,676,187
Other 1,064,900
Internal balances (385,388) 385,388
Inventory I, 175,194 I, 175,194 538,352
Prepaid pension obligation 5,586,352 5,586,352
Prepaid expenses
Other current assets 45,918 45,918 782,796
Total current assets 36,580,489 6,529,327 43,109,816 5,879,582
Noncurrent Assets:
Notes receivable 3,210,000 3,210,000
Lease receivable 3,221,013 3,221,013
Bond issuance costs, net 434,686 434,686
Net capital assets:
Land and construction in progress 14,905,437 62,152 14,967,589 2,803,295
Depreciable capital assets 24,834,643 1,246,422 26,081,065 44,806,688
Other assets 320,483 320,483 3,574,738
Total noncurrent assets 46,926,262 1,308,574 48,234,836 51' 184,721
Total assets 83,506,751 7,837,901 91,344,652 57,064,303
-28-
LIABILITIES Primary Government
Governmental Business-type Component
Current Liabilities: Activities Activities Total Units
Voucher and accounts payable $ 2,018,213 $ 248,370 $ 2,266,583 $ 1,443,319
Accrued payables 924,908 52,965 977,873 156,385
Due to other taxing agencies
Unearned revenue 4,523,454 33,700 4,557,154
Accrued compensated absences 1,008,012 92,323 1,100,335
Accrued interest 165,177 165,177
Notes payable due within one year 366,923 366,923 399,498
Bonds payable due within one year 1,289,587 1,289,587
Other current liabilities 45,918 45,918 1,236,829
Total current liabilities 10,296,274 473,276 10,769,550 3,236,031
Noncurrent Liabilities:
Accrued compensated absences 1,020,206 14,414 1,034,620
Landfill post-closure costs 2,062,500 2,062,500
Notes payable 6,953,406 6,953,406 6,627,159
Bonds payable 22,361,906 22,361,906
Total noncurrent liabilities 30,335,518 2,076,914 32,412,432 6,627,159
Total liabilities 40,631,792 2,550,190 43,181,982 9,863,190
NET ASSETS
Invested in capital assets, net
of related debt 31,957,381 1,308,574 33,265,955 40,620,468
Restricted for:
Housing and development projects 897,942 732,817 1,630,759
Capital projects 4,105,639 4,105,639
Unrestricted 5,913,997 3,246,320 9,160,317 6,580,645
TOTAL NET ASSETS $42,874,959 $5,287,711 $48,162,670 $47,201,113
See accompanying notes to the basic financial statements.
-29-
FUNCTIONS/PROGRAMS
Primary Government:
Governmental activities:
General government
Public safety
Public service
Parks and recreation
Planning and development
Interest on long-term debt
CITY OF PADUCAH, KENTUCKY
STATEMENT OF ACTIVITIES
FOR THE YEAR ENDED JUNE 30, 2012
Expenses
$12,937,997
17,045,731
6,163,602
2,654,098
1,192,952
1,059,537
Charges for
Services
$ 1,488,845
509,297
1,032,953
97,896
Total governmental activities (See Note 1) 41,053,917 3,128,991
Business-type activities:
Solid Waste
Section Eight Housing
Civic Center
TISA
Total business-type activities
TOTAL PRIMARY GOVERNMENT
Component Units:
Authorities:
Paducah Water Works
Paducah Transit Authority
TOTAL COMPONENT UNITS
General revenues:
3,900,264
1,921,004
71,069
173,708
6,066,045
$47,119,962
$ 7,579,648
4,325,919
$I I ,905,567
Taxes and licenses:
4,437,341
34,038
99,603
4,570,982
$ 7,699,973
$ 9,585,433
I, 145,997
$10,731,430
Property taxes, levied for general purposes
Franchise tax
Telecommunications tax
Insurance premium tax
Vehicle tax
Bank tax
Gross receipts license tax
Employee license tax
Other taxes
Transient room tax
Unrestricted investment earnings
Gain (loss) on sale of capital assets
Insurance recoveries
Miscellaneous
Total general revenues and special items
Transfers
Total general revenues, special items and transfers
Change in net assets
Net assets, July 1, 201 1
Adjustment made by component unit
NET ASSETS, JUNE 30,2012
See accompanying notes to the basic financial statements.
-30-
Program Revenues
Operating
Grants and
Contributions
$ 645,860
705,861
185,840
551,890
125,796
2,215,247
1,647,981
1,647,981
$3,863,228
$
1,740,552
$1,740,552
Exhibit 2
Capital
Grants and
Contributions
$ 11,790
521,379
533,169
15,266
15,266
$ 548,435
$ 247,196
1,277,190
$1,524,386
Net (Expense) Revenue and Changes in Net Assets
Primary Government
Governmental Business-type Component
Activities Activities Total Units
$ (10,791 ,502)
(15,309,194)
(4,944,809)
(2,556,202)
(641,062)
(933,741)
(35, 176,51 0)
(35, 176,51 0)
4,267,812
150,974
710,951
3,690,806
614,786
216,829
4,359,835
18,095,182
677,409
340,975
203,261
36,718
27,448
33,392,986
270,620
33,663,606
(1,512,904)
44,387,863
$ 42,874,959
$
552,343
(273,023)
(37,03])
(74,105)
168,184
168,184
48,806
2,443
51,249
(270,620)
(219,371)
(51,187)
5,338,898
$5,287,711
$ (10,791 ,502)
(15,309, 194)
(4,944,809)
(2,556,202)
(641,062)
(933,741)
(35, 176,51 0)
552,343
(273,023)
(37,031)
(74, 105)
168,184
(35,008,326)
4,267,812
150,974
710,951
3,690,806
614,786
216,829
4,359,835
18,095,182
677,409
340,975
252,067
39,161
27,448
33,444,235
33,444,235
(I ,564,091)
49,726,761
$ 48,162,670
$
2,252,981
(162,180)
2,090,801
20,342
(14,957)
58,498
63,883
63,883
2,154,684
44,993,885
52,544
$47,20 I, 113
-3 ]-
Cash and cash equivalents
Investments
Accounts receivable:
Accounts
Grants
Interest
Propertytaxes(netof
ASSETS
allowances for uncollectibles)
Due from other funds
TOTAL ASSETS
CITY OF PADUCAH, KENTUCKY
BALANCE SHEET
GOVERNMENTAL FUNDS
JUNE 30, 2012
General
Fund
$ 6,186,742
1,500,000
6,458,498
189,538
13,481
4,729,187
45,918
$19,123,364
LIABILITIES AND FUND BALANCES
Liabilities:
Voucher and accounts payable
Accrued payroll and payroll taxes
Due to other funds
Due to other taxing agencies
Deferred revenue
Accrued compensated absences
Total liabilities
Fund Balances:
Restricted for:
Highways and streets
Public safety
Capital improvements
Committed for:
Capital improvements
Assigned for:
Capital improvements
Public service
Public safety
Planning and development
Debt service
Unassigned:
General Fund
Total fund balances
TOTAL LIABILITIES AND FUND BALANCES
See accompanying notes to the basic financial statements.
-32-
$ 475,777
858,606
I,539,809
4,701,380
226,354
7,80I,926
II ,32I ,438
II,32I,438
$19, I23,364
General
Capital
Improvements
$1,876,876
500,000
3I ,039
4,494
$2,412,409
$ 9I8,471
6,000
924,471
1,487,938
1,487,938
$2,412,409
Exhibit 3
Special
Revenue
Investment
Fund
$1,097,740
500,000
4,494
1,028,999
$2,631,233
$
2,631,233
2,631,233
$2,631,233
Debt Nonmajor Total
Service Governmental Governmental
Fund Funds Funds
$35,088 $2,158,178 $11 ,354,624
2,500,000
33,816 217,999 6,710,313
1,500 222,077
22,469
4,729,187
1,074,917
$68,904 $2,377,677 $26,613,587
$ $ 360,573 $ 1,754,821
50,298 908,904
1,539,809
40,419 4,747,799
226,354
451,290 9,177,687
1 '156,681 1 '156,681
80,099 80,099
286,276 286,276
2,631,233
1,487,938
403,331 403,331
68,904 68,904
11,321,438
68,904 1,926,387 17,435,900
$68,904 $2,377,677 $26,613,587
-33-
CITY OF PADUCAH, KENTUCKY
RECONCILIATION OF THE GOVERNMENTAL FUNDS
BALANCE SHEET TO STATEMENT OF NET ASSETS
JUNE 30,2012
Total fund balance -total governmental funds
Amounts reportedfor governmental activities in the Statement
of Net Assets are different because:
Delinquent property taxes receivable are not reported in the
governmental funds balance sheet since they are not considered
"available" revenues.
The long-term notes receivable are not reported in the governmental
funds balance sheet since they are not available to pay current period
expenditures.
Interest receivable on the long-term notes receivable is not reported on
the governmental funds balance sheet since neither the note receivable
nor the interest is available to pay current period expenditures.
Inventory is not a current financial resource, and therefore, is not
reported in the governmental funds balance sheet.
A prepaid pension obligation is not a current financial resource, and
therefore, is not reported in the governmental funds balance sheet.
Capital assets used in governmental activities are not current financial
resources, and therefore, are not reported in the governmental funds
balance sheet. This amount includes capital assets of Internal Service
Funds.
Governmental funds report losses on direct financing leases when
incurred; whereas, the loss of direct financing leases are deferred and
amortized over the life of the lease in the Statement of Net Assets.
Bond issuance costs used in governmental activities are not current
financial resources, and therefore, are not reported in the
governmental funds balance sheet.
-34-
Exhibit 4
$17,435,900
171,345
3,315,000
23,057
1,098,304
5,586,352
39,740,080
320,483
434,686
(Continued)
CITY OF PADUCAH, KENTUCKY
RECONCILIATION OF THE GOVERNMENTAL FUNDS
BALANCE SHEET TO STATEMENT OF NET ASSETS
JUNE 30, 2012
Receivables from direct financing leases are not available in the
current period, and therefore, are deferred in the governmental funds
balance sheet.
Accrued interest payments on debt are not due and payable in the
current period, and therefore, are not reported in the governmental
funds balance sheet.
The portion of accrued compensated absences not due and payable in
the current period, and therefore, not reported in the governmental
funds balance sheet.
Long-term debts of ($30,971 ,822) are not due and payable in the
current period; and, therefore, they are not reported in the
governmental funds balance sheet. See Note 3 for detail. The long-
term debts are:
Due within one year
Due after one year
$ 1,656,510
29,315,312
Internal service funds are used by management to charge the costs of
certain activities, such as insurance and fleet management, to
individual funds. The assets and liabilities of the Internal Service
Funds (net of amount allocated to business-type activities) not
included in other reconciling items are:
Current assets
Total liabilities
Net amount allocated to
business-type activities
$ 4,925,332
(332,437)
(385,388)
NET ASSETS OF GOVERNMENTAL ACTIVITIES
See accompanying notes to the basic financial statements.
-35-
Exhibit 4
(Continued)
$ 3,428,067
(165,177)
(I ,748,823)
(30,971 ,822)
4,207,507
$42,874,959
Exhibit 5
CITY OF PADUCAH, KENTUCKY
STATEMENT OF REVENUES, EXPENDITURES
AND CHANGES IN FUND BALANCES
GOVERNMENTAL FUNDS
FOR THE YEAR ENDED JUNE 30, 2012
Special
General Revenue
General Capital Investment
Revenues: Fund Improvements Fund
Taxes $ 5,910,258 $ $
Licenses 22,291,319 4,462,1I3
Charges for services 568,902
Intergovernmental
Grants 830,059 212,323
Interest 124,564 7,418 II ,591
Miscellaneous 1,072,156 383,880 61,560
Total revenues 30,797,258 603,621 4,535,264
Expenditures:
Current operations:
General government 5,117,194
Public safety 16,860,191
Public service 4,437,020
Parks and recreation 2,677,781
Planning and development 1,364,880
Other 516,534
Capital outlay 2,104,993
Debt service:
Principal requirement
Interest and fiscal requirement
Total expenditures 29,608,720 2,104,993 1,364,880
Excess (deficiency) of revenues over expenditures I, 188,538 (I ,501 ,372) 3,170,384
Other Financing Sources (Uses):
Capital lease
Proceeds of refunding bond, net
Transfer to refunded bond escrow agent
Long-term debt draws 101,983
Long-term debt issued
Transfers in 834,534 1,822,397 110,988
Transfers out (1,641,755) (514,712) (3,237,151)
Total other financing sources (uses) (807,22I) I,409,668 (3, I26, I63)
Net change in fund balances 38I ,317 (91 ,704) 44,22I
Fund balances, July I, 20 II 10,940,I21 I,579,642 2,587,012
FUND BALANCES, JUNE 30, 2012 $11,321,438 $ 1,487,938 $ 2,631,233
See accompanying notes to the basic financial statements.
-36-
Debt Nonmajor Total
Service Governmental Governmental
Fund Funds Funds
$ $ 433,350 $ 6,343,608
26,753,432
248,705 817,607
571,924 619,911 1,191,835
657,017 1,699,399
19,007 162,580
5,907 378,572 1,902,075
577,831 2,356,562 38,870,536
5,117,194
1,619,237 18,479,428
I ,159,682 5,596,702
2,677,781
851,785 2,216,665
5I6,534
2,104,993
1,434,246 I,434,246
I, II4,852 I, 114,852
2,549,098 3,630,704 39,258,395
( 1 ,97I ,267) (1 ,274, I42) (387,859)
405,796 405,796
3,910,000 3,910,000
(3,910,000) (3,91 0,000)
101,983
1,560,103 1,560,825 5,888,847
(4I5,92I) (5,809,539)
1,965,899 1,144,904 587,087
(5,368) (129,238) I99,228
74,272 2,055,625 17,236,672
$ 68,904 $ 1,926,387 $17,435,900
-37-
CITY OF PADUCAH, KENTUCKY
RECONCILIATION OF THE STATEMENT OF REVENUES, EXPENDITURES AND
CHANGES IN FUND BALANCES OF GOVERNMENTAL FUNDS
TO THE STATEMENT OF ACTIVITIES
FOR THE YEAR ENDED JUNE 30, 2012
Net change in fund balances -total governmental funds
Amounts reported for governmental activities in the Statemellt
of Activities are different because:
Inventory purchases require the use of current financial resources,
and therefore, are reported as expenditures in governmental funds.
Inventory sales provide current financial resources and are reported
as revenues in governmental funds.
Governmental funds report capital outlays as expenditures.
However, in the Statement of Activities, the cost of those assets is
a11ocated over their estimated useful lives as depreciation expense.
This is the amount of capital outlays in the current period. This
amount incJudes Internal Service Fund's capital outlays of
$1,033,935.
Proceeds from the disposal of capital assets are reported gross in the
governmental funds because the related assets were recorded as
expenditures when purchased. However, the proceeds are netted
with the book value in the government-wide statement of activities.
This amount incJudes Internal Service Fund's book value of $21 ,095.
Co11ections on long-term notes receivable and related interest
receivable are revenues in the governmental funds when co11ected.
Delinquent property taxes receivable are not considered "available"
revenues in the governmental funds.
Direct financing leases receivable are not considered "available"
revenues in the governmental funds.
The prepayment of a pension obligation requires the use of current
financial resources, and therefore, is reported as an expenditure in
governmental funds. However, the prepayment does not affect net
assets in the government-wide Statement of Activities.
Depreciation expense on capital assets is reported in the government-
wide Statement of Activities and Changes in Net Assets, but does not
require the use of current financial resources. Therefore,
depreciation expense is not reported as an expenditure in
governmental funds. This amount incJudes Internal Service Funds'
depreciation expense of $578,321.
-38-
Exhibit 6
$ 199,228
274,328
(429,975)
2,156,290
(21 ,095)
(283,972)
{5,937)
(180,754)
(48,580)
(3,323,064)
(Continued)
CITY OF PADUCAH, KENTUCKY
RECONCILIATION OF THE STATEMENT OF REVENUES, EXPENDITURES AND
CHANGES IN FUND BALANCES OF GOVERNMENTAL FUNDS
TO THE STATEMENT OF ACTIVITIES
FOR THE YEAR ENDED JUNE 30, 2012
Proceeds from the issuance and draw down of debt provides current
financial resources and is reported as an other financing source in
governmental funds.
Capital acquisitions financed with long term financing excluded
from the governmental funds because it does not a produce or use
current financial resources
Principal payments of debt require the use of current financial
resources, and therefore, are reported as expenditures in
governmental funds. However, principal payments of debt do not
affect net assets in the government-wide Statement of Activities.
Governmental funds report the effect of bond refinancing costs when
debt is issued; whereas, these amounts are netted with refinancing
bonds payable and amortized in the Statement of Activities.
Governmental funds report the effect of losses on direct financing
leases when incurred; whereas, these amounts are deferred and
amortized in the Statement of Activities.
Accrued interest payments on debt do not require the use of current
financial resources. Accrued interest is reported as an expenditure in
the government-wide Statement of Activities.
Long-term accrued compensated absences do not require the use of
current financial resources, and therefore, are not reported as
expenditures in governmental funds.
Governmental funds report the effect of bond issuance costs when
debt is issued; whereas, these amounts are deferred and amortized in
the Statement of Activities.
Governmental funds report the litigation judgments in the period in
which they are determined.
Internal Service Funds are used by management to charge the costs
of certain activities, such as insurance and fleet management, to
individual funds. The net revenue of the Internal Service Funds is
reported with governmental activities net of the amount allocated to
business-type activities and depreciation expense. These amounts
are as follows:
Change in net assets
Net of amount allocated to
business-type activities
Capital Outlays
Book value of disposals
Depreciation expense
$ 397,788
(34, 102)
( 1 ,033,935)
21,095
578,321
CHANGE IN NET ASSETS OF GOVERNMENTAL ACTIVITIES
See accompanying notes to the basic financial statements.
-39-
Exhibit 6
(Continued)
$ (3,91 0,000)
(2,674,093)
5,344,246
58,717
(26,895)
8,659
(45,377)
(16,540)
1,482,743
(70,833)
$ (1,512,904)
Exhibit 7
CITY OF PADUCAH, KENTUCKY
BUDGETARY COMPARISON STATEMENT (BUDGETARY BASIS)
GENERAL FUND
FOR THE YEAR ENDED JUNE 30, 2012
Variance with
Final Budget
Budgeted Amounts Actual Positive
Original Final Amounts (Negative)
Beginning budgetary fund balance $I0,940,I21 $I0,940, I 2I $I0,940,12I $
Resources (Inflows):
Taxes:
Real and personal,
current year 4,905,600 4,708,200 4,708,207 7
Real and personal,
prior year (net of refunds) 123,000 156,180 156,182 2
Franchise 155,000 I5I,625 151,629 4
Bank taxes 224,500 216,825 216,829 4
In lieu of tax payment 221,490 322,685 322,69I 6
Penalty, interest and
advertising 46,770 4I,920 41,928 8
Paducah Junior College
tax collections 3I2,790 312,790
Total taxes 5,676,360 5,910,225 5,910,256 3I
Licenses:
Business licenses 4,202,000 4,359,835 4,359,835
Employee earnings I2,990,000 13,633,065 I3,633,068 3
Comcast fees 305,800 307,455 307,460 5
Penalties I55,000 235,360 235,361 I
Alcoholic beverages I25,000 I09,290 109,290
Insurance premium tax 3,552,000 3,690,805 3,690,806 I
Building permits I IO,OOO I25,115 I25,118 3
Electrical permits 29,500 36,040 36,044 4
Zoning change fees 8,000 6,310 6,311 I
Miscellaneous building
and electrical fees 250 5,950 5,868 (82)
KJDA payroll rebate (2 I I ,750) (2I7,845) (217,842) 3
Total licenses 21,265,800 22,291,380 22,291,319 (6I)
Charges for services:
Tax collection fee I53,000 I54,080 I54,080
Administrative charge 266,000 266,000 266,000
Base court revenue 60,000 52,620 52,621 I
Recreation fees 82,250 97,885 97,897 I2
Total charges for services 56I,250 570,585 570,598 I3
(Continued)
-40-
Exhibit 7
(Continued)
CITY OF PADUCAH, KENTUCKY
BUDGETARY COMPARISON SCHEDULE (BUDGETARY BASIS)
GENERAL FUND
FOR THE YEAR ENDED JUNE 30,2012
Variance with
Final Budget
Budgeted Amounts Actual Positive
Grants: Original Final Amounts (Negative)
Police State Incentive $ 320,500 $ 304,510 $ 304,512 $ 2
Police hiring supplement 185,000 161,175 161,178 3
Fire State Incentive 270,000 264,985 264,989 4
Ronald McDonald Grant 230 234 4
Kentucky League of Counties grants 27,445 27,448 3
Highway safety grant 20,000 57,725 57,728 3
State Justice Cabinet 13,970 13,971 1
Total grants 795,500 830,040 830,060 20
Interest 113,700 124,560 124,564 4
Other:
Property rent and sales 643,640 690,480 690,528 48
Property upkeep and
maintenance 126,985 112,240 112,246 6
Contractual programs 7,500 4,035 4,039 4
E911-GIS 25,380 25,380 25,344 (36)
Miscellaneous 206,615 238,285 238,304 19
Total other I ,01 0,120 1,070,420 1,070,461 41
Other financing sources:
Operating transfers in 560,860 809,500 834,534 25,034
Amounts available for appropriation 40,923,711 42,546,831 42,571,913 25,082
Charges to Appropriations (Outflows):
General government:
General administration:
Mayor and Commissioners 190,565 197,450 197,316 134
City Manager 434,055 403,360 403,085 275
City Clerk 177,420 170,945 170,370 575
Corporate Counsel 154,810 194,745 194,703 42
Non-departmental 619,310 678,880 678,545 335
Memberships and contingency 334,355 24,275 24,266 9
Civic beautification 3,810 3,810 3,739 71
Total general administration 1,914,325 1,673,465 1,672,024 1,441
(Continued)
-41-
Exhibit 7
(Continued)
CITY OF PADUCAH, KENTUCKY
BUDGETARY COMPARISON SCHEDULE (BUDGETARY BASIS)
GENERAL FUND
FOR THE YEAR ENDED JUNE 30, 2012
Variance with
Final Budget
Budgeted Amounts Actual Positive
General government: Original Final Amounts (Negative)
Finance:
Finance administration $ 253,720 $ 265,590 $ 265,274 $ 316
Accounting and payroll 327,020 316,610 316,453 157
Human resources
Rental property 31,025 32,475 32,423 52
Radio operations 50,525 40,970 40,940 30
Revenue collection 403,520 371,365 371,201 164
Total finance 1,065,810 1,027,010 1,026,291 719
Planning:
Administration 255,875 255,995 255,699 296
Planning 86,090 86,045 86,016 29
Grants 170,450 144,450 144,168 282
Total planning 512,415 486,490 485,883 607
Human rights 48,430 53,565 53,550 15
Inspection:
Inspection administration 182,175 182,460 181,948 512
Construction 364,330 379,095 379,025 70
Code enforcement 376,640 268,770 268,330 440
Total inspection 923,145 830,325 829,303 1,022
Information technology 589,350 534,640 534,375 265
Risk management/ Human resources 298,985 292,760 292,451 309
Public safety:
Police:
Police administration 903,435 914,935 914,188 747
Patrol 6,259,635 5,986,470 5,985,275 I, 195
Investigations 1,958,990 1,943,170 1,942,478 692
Total police 9,122,060 8,844,575 8,841,941 2,634
Fire:
Fire administration 235,280 378,845 378,480 365
Suppression 5,967,365 7,336,755 7,336,696 59
Prevention 183,995 183,155 183,025 130
Training 131,675 120,045 I 19,929 116
Total fire 6,518,315 8,018,800 8,018,130 670
(Continued)
-42-
Exhibit 7
(Continued)
CITY OF PADUCAH, KENTUCKY
BUDGETARY COMPARISON SCHEDULE (BUDGETARY BASIS)
GENERAL FUND
FOR THE YEAR ENDED JUNE 30,2012
Variance with
Final Budget
Budgeted Amounts Actual Positive
Public service: Original Final Amounts (Negative)
Public works:
Street maintenance $ 2,202,475 $ 1,909,505 $ 1,909,170 $ 335
Street lighting 515,000 539,850 539,848 2
Maintenance 988,450 927,040 922,763 4,277
Total public works 3,705,925 3,376,395 3,371,781 4,614
Engineering services:
Engineering services 610,480 522,295 521,970 325
GIS operation
Flood control 504,450 543,585 543,269 316
Total engineering services 1,114,930 1,065,880 1,065,239 641
Parks and recreation
Parks administration 800,665 762,045 761,740 305
Grounds maintenance 1,410,000 1,423,780 1,423,221 559
Pool 169,845 118,465 118,213 252
Recreation programs 466,095 374,740 374,606 134
Total recreation 2,846,605 2,679,030 2,677,780 1,250
PRDA 131,410 123,030 122,935 95
Other:
Cable authority 84,030 84,415 84,414 I
Mainstreet program 253,975 174,075 173,866 209
Leave expense 45,970 45,967 3
Intergovernmental expense 312,790 312,790
Total other 338,005 617,250 617,037 213
Other financing uses:
Operating transfers out 1,586,820 1,653,035 1,641,755 11,280
Total charges to appropriations 30,716,530 31,276,250 31,250,475 25,775
BUDGETARY FUND BALANCE,
JUNE 30, 2012 $10,207,181 $11 ,270,581 $11,321,438 $50,857
See accompanying notes to the basic financial statements.
-43-
CITY OF PADUCAH, KENTUCKY
BUDGETARY COMPARISON STATEMENT
GENERAL FUND
FOR THE YEAR ENDED JUNE 30,2012
Exhibit 8
Note A -Explanation of Differences Between Budgetary Inflows and Outflows and GAAP Revenues and
Expenditures
Sources/inflows of resources:
Actual amounts "available for appropriation" from
the budgetary comparison schedule
Differences -budget to GAAP:
The beginning fund balance is a budgetary resource,
but is not a current year revenue for financial
reporting purposes
Transfers from other funds are inflows of budgetary
resources, but are not revenues for financial
reporting purposes
Total revenues as reported on the statement of revenues,
expenditures, and changes in fund balances-
governmental funds
Uses/outflows of resources:
Actual amounts "total charges to appropriations" from
the budgetary comparison schedule
Differences -budget to GAAP:
Transfers to other funds are outflows of budgetary
resources, but are not expenditures for financial
reporting purposes
Total expenditures as reported on the statement of
revenues, expenditures, and changes in fund balances-
governmental funds
See accompanying notes to the basic financial statements.
-44-
General
Fund
$42,571,913
(1 0,940, 121)
(834,534)
$30,797,258
$31,250,475
(1 ,641,755)
$29,608,720
Exhibit 9
CITY OF PADUCAH, KENTUCKY
BUDGETARY COMPARISON STATEMENT (BUDGETARY BASIS)
SPECIAL REVENUE INVESTMENT FUND
FOR THE YEAR ENDED JUNE 30,2012
Variance with
Final Budget
Budgeted Amounts Actual Positive
Original Final Amounts (Negative)
Beginning budgetary fund balance $2,587,012 $2,587,012 $2,587,012 $
Resources (Inflows):
Licenses:
Employee earnings 4,330,000 4,462,110 4,462,113 3
Interest 11,590 11,591 I
Miscellaneous 61,560 61,560
Total licenses 4,330,000 4,535,260 4,535,264 4
Other financing sources:
Long-term debt issued
Operating transfers in 110,985 110,988 3
Total licenses 110,985 110,988 3
Amounts available for appropriation 6,917,012 7,233,257 7,233,264 7
Charges to Appropriations (Outflows):
General government:
Planning and development:
Economic development 1,918,390 1,364,885 1,364,880 5
Other financing uses:
Operating transfers out 3,061,610 3,237,155 3,237,151 4
Total charges to appropriations 4,980,000 4,602,040 4,602,031 9
BUDGETARY FUND BALANCE,
JUNE 30, 2012 $1,937,012 $2,631,217 $2,631,233 $ 16
See accompanying notes to the basic financial statements.
-45-
CITY OF PADUCAH, KENTUCKY
BUDGETARY COMPARISON STATEMENT
SPECIAL REVENUE INVESTMENT FUND
FOR THE YEAR ENDED JUNE 30, 2012
Exhibit 10
Note A -Explanation of Differences Between Budgetary Inflows and Outflows and GAAP Revenues and
Expenditures
Sources/inflows of resources:
Actual amounts "available for appropriation" from
the budgetary comparison schedule
Differences -budget to GAAP:
The beginning fund balance is a budgetary resource,
but is not a current year revenue for financial
reporting purposes
Proceeds from the issuance of debt are inflows of budgetary
resources, but are not revenues for financial
reporting purposes
Transfers from other funds are inflows of budgetary
resources, but are not revenues for financial
reporting purposes
Total revenues as reported on the statement of revenues,
expenditures, and changes in fund balances-
governmental funds
Uses/outflows of resources:
Actual amounts "total charges to appropriations" from
the budgetary comparison schedule
Differences -budget to GAAP:
Transfers to other funds are outflows of budgetary
resources, but are not expenditures for financial
reporting purposes
Total expenditures as reported on the statement of
revenues, expenditures, and changes in fund balances-
governmental funds
See accompanying notes to the basic financial statements.
-46-
$7,233,264
(2,587,012)
(110,988)
$4,535,264
$4,602,031
(3,237,151)
$ 1,364,880
CITY OF PADUCAH, KENTUCKY
STATEMENT OF NET ASSETS
PROPRIETARY FUNDS
JUNE 30, 2012
Business-type Activities
ASSETS
Current Assets:
Cash and cash equivalents
Investments
Accounts receivable
Grants receivable
Interest receivable
Due from other funds
Prepaid expenses
Inventory
Total current assets
Noncurrent Assets:
Net capital assets:
Land
Depreciable capital assets
Total noncurrent assets
Total assets
LIABILITIES
Current Liabilities:
Voucher and accounts payable
Deferred grant revenue
Accrued payroll and payroll taxes
Accrued compensated absences
Due to other funds
Total current liabilities
Noncurrent Liabilities:
Landfill post-closure costs
Accrued compensated absences
Total noncurrent liabilities
Total liabilities
NET ASSETS
Invested in capital assets
Restricted for:
Housing development projects
Unrestricted
TOTAL NET ASSETS
Solid
Waste
$3,416,035
900,000
549,122
95,568
8,089
4,968,814
62,152
1,030,055
1,092,207
6,061,021
138,422
33,700
52,965
90,721
315,808
2,062,500
2,062,500
2,378,308
1,092,207
2,590,506
$3,682,713
Reconciliation to government-wide statements of net assets:
Adjustment to reflect the consolidation of Internal Service Funds'
activities related to Enterprise Funds
NET ASSETS OF BUSINESS-TYPE ACTIVITIES
See accompanying notes to the basic financial statements.
-47-
Nonmajor
Enterprise
Funds
$1,174,089
1,035
1,175,124
216,367
216,367
1,391,491
109,948
1,601
45,918
157,467
14,414
14,414
171,881
216,367
732,817
270,426
$1,219,610
Totals
$4,590,124
900,000
550,157
95,568
8,089
6,143,938
62,152
1,246,422
1,308,574
7,452,512
248,370
33,700
52,965
92,322
45,918
473,275
2,062,500
14,414
2,076,914
2,550,189
1,308,574
732,817
2,860,932
4,902,323
385,388
$5,287,711
Exhibit 11
Governmental
Activities
Internal
Service
Funds
$3,701,540
550,000
86,093
510,810
76,889
4,925,332
3,093,806
3,093,806
8,019,138
263,392
16,005
279,397
53,040
53,040
332,437
3,093,806
4,592,895
$7,686,701
CITY OF PADUCAH, KENTUCKY
STATEMENT OF REVENUES, EXPENSES
AND CHANGES IN FUND NET ASSETS
PROPRIETARY FUNDS
FOR THE YEAR ENDED JUNE 30, 2012
Business-type Activities
Operating Revenues:
Charges for services -internal
Charges for services -external
Miscellaneous
Total operating revenues
Operating Expenses:
Cost of sales and service
Depreciation and amortization
Total operating expenses
Operating income (loss)
Nonoperating Revenues (Expenses):
Interest and investment income
Gain (loss) on disposal of property
and equipment
Total nonoperating revenues (expenses)
Income (loss) before contributions and
transfers
Contributions and Transfers:
Capital contributions
Transfers in
Transfers out
Total contributions and transfers
Change in net assets
Total net assets, July I, 2011
TOTAL NET ASSETS -JUNE 30, 2012
Solid
Waste
$
4,393,598
24,907
4,418,505
3,554,098
346,166
3,900,264
518,241
48,587
2,443
51,030
569,271
(247,725)
(247,725)
321,546
3,361,167
$3,682,713
Reconciliation to government-wide statements of net assets:
Nonmajor
Enterprise
Funds
$ 99,603
1,669,802
12,217
1,781,622
2,116,922
48,955
2,165,877
(384,255)
316
316
(383,939)
27,104
(50,000)
(22,896)
(406,835)
1,626,445
$1,219,610
Adjustment to reflect the consolidation of Internal Service Funds'
activities related to Enterprise Funds
CHANGE IN NET ASSETS OF BUSINESS-TYPE ACTIVITIES
See accompanying notes to the basic financial statements.
-48-
Totals
$ 99,603
6,063,400
37,124
6,200,127
5,671,020
395,121
6,066,141
133,986
48,903
2,443
51,346
185,332
27,104
(297,725)
(270,621)
(85,289)
34,102
$ (51,187)
Exhibit 12
Governmental
Activities
Internal
Service
Funds
$6,093,553
272,105
6,365,658
5,658,259
578,321
6,236,580
129,078
40,680
36,717
77,397
206,475
196,462
(5,149)
191,313
397,788
7,288,913
$7,686,701
CITY OF PADUCAH, KENTUCKY
STATEMENT OF CASH FLOWS
PROPRIETARY FUNDS
FOR THE YEAR ENDED JUNE 30, 2012
Business-type Activities
Nonmajor
Solid Enterprise
Cash Flows from Operating Activities: Waste Funds Totals
Cash received from customers $4,375,374 $ 1,777.999 $ 6,153.373
Cash received from interfund services provided
Payments to suppliers ( 1.578,662) ( 1.578,662)
Payments to employees (1,410,012) (133,357) (I ,543,369)
Claims paid
Payments to internal service funds (598,343) (3,761) (602.104)
Other receipts 58,607 12,217 70.824
Other payments ( 1,971 ,935) ( 1,971 ,935)
Net cash provided (used) by operating activities 846,964 (318,837) 528,127
Cash Flows from Noncapital Financing Activities:
Transfers from other funds
Transfers to other funds (247,725) (22,896) (270.621)
Net cash provided (used) by noncapital
financing activities (247,725) (22,896) (270,621)
Cash Flows from Capital and Related
Financing Activities:
Capital contributions
Purchase of capital assets (369,465) (369,465)
Proceeds from sale of capital assets 2,443 2,443
Net cash provided (used) by capital and
related financing activities (367,022) (367,022)
Cash Flows from Investing Activities:
Proceeds from sale of investment securities 1,625.000 1,625.000
Interest on cash and investments 48,587 316 48,903
Purchase of investments (900,000) (900.000)
Net cash provided (used) by investing activities 773.587 316 773,903
Net increase (decrease) in cash and cash equivalents 1,005,804 (341.417) 664,387
Cash and cash equivalents, July I. 2011 2,410,231 1,515,506 3,925,737
CASH AND CASH EQUIVALENTS, JUNE 30, 2012 $ 3,416,035 $ 1,174,089 $4,590,124
Reconciliation of Operating Income (Loss) to Net
Cash Provided (Used) by Operating Activities:
Operating income (loss) $ 518,241 $ (384,255) $ 133.986
Adjustments to reconcile operating income to
net cash provided by operating activities:
Depreciation and amortization 346.166 48,955 395,121
Change in assets and liabilities:
Receivables (18,224) 8,594 (9.630)
Prepaid expenses 9,590 9,590
Deferred grant revenue 33,700 33.700
Due to other funds
Accrued expenses 20,412 1,360 21,772
Accounts payable (53,331) (3,081) (56,41 2)
NET CASH PROVIDED (USED) BY OPERATING
ACTIVITIES $ 846,964 $ (318,837) $ 528,127
See accompanying notes to the basic financial statements.
-49-
Exhibit 13
Governmental
Activities
Internal
Service
Funds
$
6,294,345
(245,090)
(269,305)
(3,767.220)
(2,011 ,648)
1,082
(5.149)
196,462
191,313
(I ,033.935)
57,812
(976,123)
1,500,000
40,680
(550.000)
990,680
206,952
3,494,588
$ 3,701,540
$ 129.078
578,321
(71 ,31 3)
418,130
(I ,064,335)
8,657
2,544
$ 1,082
ASSETS
Cash and cash equivalents
Receivables:
Accounts
Interest
Investments at fair value:
Money market funds
Certificates of deposit
Common stock
Corporate bonds
U.S. agencies bonds
Mutual funds
Total assets
LIABILITIES
Voucher and accounts payable
Due to other funds
Payroll taxes and withholdings
payable
Total liabilities
NET ASSETS
Held in trust for pension benefits
and other purposes
CITY OF PADUCAH, KENTUCKY
STATEMENT OF NET ASSETS
FIDUCIARY FUNDS
JUNE 30, 2012
Exhibit 14
Primary Government
Pension
Funds
$ 60,996
27,690
200,362
50,000
2,552,720
1,527,228
1,472,496
1,782,894
7,674,386
82
82
$7,674,304
$
Private-
purpose
Trusts
1,106,065
1,106,065
$1,106,065
Agency
Funds
$684,762
684,762
684,762
$684,762
See accompanying notes to the basic financial statements.
-50-
Additions:
Contributions:
Employer
Plan members
Intergovernmental revenues
Private donations
Total contributions
Investment income:
Net increase (decrease) in
fair value of investments
Loss on sale of investments
Interest and dividends
Net investment income
Total additions
Deductions:
Benefits
Capital outlay
Administrative expenses
Total deductions
Change in net assets
Net assets, July 1, 2011
NET ASSETS, JUNE 30, 2012
CITY OF PADUCAH, KENTUCKY
STATEMENT OF CHANGES IN NET ASSETS
FIDUCIARY FUNDS
FOR THE YEAR ENDED JUNE 30, 2012
See accompanying notes to the basic financial statements.
-51-
Exhibit 15
Private-
Pension purpose
Funds Trusts
$ 391,744 $
7,548
II, 135
3,458
399,292 14,593
(122,860) (61,241)
36,604
247,917 32,000
125,057 7,363
524,349 21,956
1,645,618
56,438
56,853 17,886
1,702,471 74,324
(1,178,122) (52,368)
8,852,426 1,158,433
$7,674,304 $1,106,065
CITY OF PADUCAH, KENTUCKY
BASIC FINANCIAL STATEMENTS
COMPONENT UNITS FINANCIAL STATEMENTS
COMPREHENSIVE ANNUAL FINANCIAL REPORT
YEAR ENDED JUNE 30, 2012
THIS PAGE INTENTIONALLY LEFT BLANK
Exhibit 16
CITY OF PADUCAH, KENTUCKY
STATEMENT OF NET ASSETS
COMPONENT UNITS
JUNE 30, 2012
All
ASSETS Paducah Paducah Component
Water Transit Unit
Current Assets: Works Authority Totals
Cash and cash equivalents $ 2,213,404 $ 47,333 $ 2,260,737
Receivables, net:
Accounts 507,083 167,448 674,531
Grants 558,266 558,266
Other 1,064,900 1,064,900
Inventories 528,352 10,000 538,352
Prepaid expenses
Other current assets 782,796 782,796
Total current assets 5,096,535 783,047 5,879,582
Noncurrent Assets:
Net capital assets:
Land and construction in progress 2,316,981 486,314 2,803,295
Depreciable capital assets 40,377,764 4,428,924 44,806,688
Other assets 3,574,738 3,574,738
Total noncurrent assets 46,269,483 4,915,238 51,184,721
Total assets 51,366,018 5,698,285 57,064,303
-52-
All
LIABILITIES Paducah Paducah Component
Water Transit Unit
Current Liabilities: Works Authority Totals
Voucher and accounts payable $ 722,414 $ 720,905 $ 1,443,319
Accrued payables 156,385 156,385
Notes payable due within one year 364,440 35,058 399,498
Other current liabilities 986,829 250,000 1,236,829
Total current liabilities 2,073,683 1,162,348 3,236,031
Noncurrent Liabilities:
Notes payable 6,627,159 6,627,159
Total noncurrent liabilities 6,627,159 6,627,159
Total liabilities 8,700,842 1,162,348 9,863,190
NET ASSETS
Net Assets:
Invested in capital assets,
net of related debt 35,705,230 4,915,238 40,620,468
Unrestricted 6,959,946 (379,301) 6,580,645
TOTAL NET ASSETS $42,665, 176 $4,535,937 $47,201,113
See accompanying notes to the basic financial statements
-53-
FUNCTIONS/PROGRAMS
Authorities:
Business-type activities:
Paducah Water Works
Paducah Transit Authority
TOTAL COMPONENT UNITS
General Revenues:
Unrestricted investment earnings
Gain (loss) on disposal of assets
Miscellaneous general
Total general revenues and transfers
Change in net assets
Net assets, July 1, 2011
Adjustment made by component unit
NET ASSETS, JUNE 30, 2012
CITY OF PADUCAH, KENTUCKY
STATEMENT OF ACTIVITIES
COMPONENT UNITS
FOR THE YEAR ENDED JUNE 30,2012
Charges for
Expenses Services
$ 7,579,648 $ 9,585,433
4,325,919 1,145,997
$11 ,905,567 $10,731,430
See accompanying notes to the basic financial statements.
-54-
Exhibit 17
Program Revenues
Operating Capital
Grants and Grants and
Contributions Contributions
$ $ 247,196
1,740,552 1,277,190
$1,740,552 $1,524,386
Net (Expense) Revenue and Changes
in Net Assets
Paducah Paducah
Water Transit
Works Authority Totals
$ 2,252,981 $ $ 2,252,981
(162,180) (162,180)
2,252,981 (162,180) 2,090,801
20,342 20,342
(14,957) (14,957)
58,498 58,498
20,342 43,541 63,883
2,273,323 (118,639) 2,154,684
40,391,853 4,602,032 44,993,885
52,544 52,544
$42,665,176 $4,535,937 $47,201,113
-55-
CITY OF PADUCAH, KENTUCKY
NOTES TO THE FINANCIAL STATEMENTS
COMPREHENSIVE ANNUAL FINANCIAL REPORT
YEAR ENDED JUNE 30, 2012
CITY OF PADUCAH, KENTUCKY
NOTES TO FINANCIAL STATEMENTS
FOR THE YEAR ENDED JUNE 30,2012
Note 1 -Summary of Significant Accounting Policies:
General Statement
The City of Paducah (City) complies with generally accepted accounting principles (GAAP) as applied to
governmental units. This requires the use of the accrual basis of accounting for government-wide
financial statements and proprietary funds financial statements and a modified accrual basis of accounting
for the governmental funds financial statements. The Governmental Accounting Standards Board (GASB)
is the accepted standard-setting body for establishing governmental accounting and financial reporting
principles. The financial reporting entity, basis of accounting, and other significant policies employed by
the City are summarized as follows:
Financial Reporting Entity
The City operates under a City Manager form of government. The Board of Commissioners consists of a
Mayor and four Commissioners elected at large by the citizens on a non-partisan basis. As required by
generally accepted accounting principles, the financial statements of the reporting entity include those of
the City of Paducah (the primary government) and its component units. The component units discussed
below are included in the City's reporting entity because of the significance of their operational or
financial relationships with the City.
Blended Component Units
Police and Firefighters' Pension Fund-This retirement fund was established for the benefit of the
police and firemen of the City. It is administered by a Board of Trustees consisting of the Mayor, City
Finance Director and representatives of the Police and Fire Departments. The Board is authorized to
establish benefit levels and to approve actuarial assumptions used in the determination of contribution
levels.
Discretely Presented Component Units
The component unit column in the basic financial statements includes the financial data of the City's other
component units. They are reported in a separate column to emphasize that they are legally separate from
the City. The following component units are included in the reporting entity because of their financial
relationship with the City; and, the City is able to impose its will on the organizations.
Paducah Water Works-The City of Paducah Water Works Commission is appointed by the Mayor.
The rates for user charges and bond issuance authorizations are subject to approval by the City
Commission of the City of Paducah.
Transit Authority of the City of Paducah-The Transit Authority's governing board is appointed by
the Mayor of the City of Paducah. The City is the grantee agency receiving, on behalf of the Transit
Authority, its principal revenues. The City also contributes substantially to the operation of the
Authority by providing cash subsidies and facilities.
(Continued)
-56-
CITY OF PADUCAH, KENTUCKY
NOTES TO FINANCIAL STATEMENTS
FOR THE YEAR ENDED JUNE 30, 2012
Note 1 -Summary of Significant Accounting Policies:
Discretely Presented Component Units
Complete financial statements of the individual component units can be obtained from their respective
administrative offices in the following locations:
Paducah Water Works
401 Washington Street
Paducah, Kentucky 42003
Related Organizations
Transit Authority of the
City of Paducah
850 Harrison Street
Paducah, Kentucky 42001
City officials are also responsible for appointing the members of boards of other organizations; but, the
City's accountability for these organizations does not extend beyond appointing authority. The
organizations listed below are notable related organizations which have not been included in the City's
report.
Paducah Housing Authority -The Paducah Housing Authority (PHA) is a legally separate entity that
provides for construction, operation, and management of low income housing projects within the City.
PHA is a legally separate entity and is not financially accountable to the City. This organization is not
included as a component unit of the City.
Paducah Power System -The Paducah Power System (PPS) is a legally separate entity that provides
electric utilities to residents in the Paducah area. PPS is not financially accountable to the City. This
organization is not included as a component unit of the City .
.Joint Sewer Agency-As of July I, 1999, the assets and liabilities of the Wastewater/Stormwater Fund
were transferred to the Paducah-McCracken County Joint Sewer Agency pursuant to a municipal order
dated June 29, 1999. The Paducah-McCracken County Joint Sewer Agency is a legally separate entity
and is not financially accountable to the City. This organization is not included as a component unit of
the City.
Forest Hills Village, Inc.-The Corporation's purpose is to manage City of Paducah properties known
as "Forest Hills Housing Development". The City and Corporation have a lease agreement detailing
the terms and conditions of operations. Forest Hills Village, Inc. is a legally separate entity and is not
financially accountable to the City. This organization is not included as a component unit of the City.
Paducah .Junior College, Incorporated (PJC)-The College is a part of the University of Kentucky
Community College System which is now administered by the Kentucky Community and Technical
College System. Under this system, the University of Kentucky receives the monies from student
tuition, fees and other related income and provides the financing for the operational budget of the
College. A tax levied and collected by the City is a primary revenue source for the College. These
funds, as well as gifts and grants made to the College, may be used for the acquisition or improvement
of property or to finance programs beyond the level of those normally provided by community colleges
in the University of Kentucky system. PJC is a legally separate entity and is not financially
accountable to the City. This organization is not included as a component unit of the City.
Mainstreet -Main street is a 50 I ( c )3 established for the promotion of cultural and economic growth in
Downtown Paducah. Mainstreet is a legally separate entity and is not financially accountable to the
City. This organization is not included as a component unit of the City.
(Continued)
-57-
CITY OF PADUCAH, KENTUCKY
NOTES TO FINANCIAL STATEMENTS
FOR THE YEAR ENDED JUNE 30, 2012
Note 1 -Summary of Significant Account Policies:
Basis of Presentation
Government-wide Financial Statements
The Statement of Net Assets and Statement of Activities display information about the reporting
government as a whole. They include all funds of the reporting entity except for fiduciary funds. The
statements distinguish between governmental and business-type activities. Governmental activities
generally are financed through taxes, intergovernmental revenues, and other nonexchange revenues.
Business-type activities are financed in whole or in part by fees charged to external parties for goods or
services.
Fund Financial Statements
Fund financial statements of the reporting entity are organized into funds, each of which is considered to
be separate accounting entities. Each fund is accounted for by providing a separate set of self-balancing
accounts that constitute its assets, liabilities, fund equity, revenues, and expenditure/expenses. Funds are
organized into three major categories: governmental, proprietary, and fiduciary. An emphasis is placed
on major funds within the governmental and proprietary categories. A fund is considered major if it is the
primary operating fund of the City or meets the following criteria:
a. Total assets, liabilities, revenues, or expenditures/expenses of that individual governmental or
enterprise fund are at least ten percent of the corresponding total for all funds of that category or
type; and
b. Total assets, liabilities, revenues, or expenditures/expenses of the individual governmental fund or
enterprise fund are at least five percent of the corresponding total for all governmental and enterprise
funds combined.
The funds of the financial reporting entity are described below:
Governmental funds are those funds through which most governmental functions typically are financed.
The measurement focus of governmental funds is on the sources, uses and balance of current financial
resources. The City has presented the following major governmental funds:
General Fund -To account for resources traditionally associated with governments which are not
required to be accounted for in another fund.
General Capital Improvements -To account for the acquisition or construction of major capital projects
other than those financed by proprietary fund operations and special assessments.
Special Revenue Investment Fund -To account for restricted funds from employee license fee used for
economic development, community redevelopment and infrastructure capital investments within
Paducah.
Debt Service Fund -To account for the accumulation of resources and payment of bond and note
principal and interest, and capital lease activity.
The City has presented the following major proprietary fund:
Solid Waste Fund -To account for the provision of refuse services to the residents of the City.
Additionally, the City reports the internal service funds which are used to account for the fleet
management services, self funded property and casualty self insurance, and self funded health and
disability insurance provided to departments of the City.
(Continued)
-58-
CITY OF PADUCAH, KENTUCKY
NOTES TO FINANCIAL STATEMENTS
FOR THE YEAR ENDED JUNE 30,2012
Note 1 • Summary of Significant Account Policies:
Basis of Presentation
Fund Financial Statements
Fiduciary funds report resources held in trust. Two of these funds are single-employer defined benefit
funds and are administered by the City. These funds are Police and Firefighters' Pension Fund (PFPF) and
Appointive Employee' Pension Fund (AEPF). Pension trust funds report the receipt, investment, and
distribution of retirement contributions. The remaining funds are private-purpose trust funds which report
the receipt and distribution of in accordance with maintenance trust agreements.
The Agency Fund accounts for the City's payroll wages, taxes and related withholdings.
Measurement Focus
Measurement focus is a term used to describe "which" transactions are recorded within the various
financial statements. Basis of accounting refers to "when" transactions are recorded regardless of the
measurement focus applied.
On the government-wide Statement of Net Assets and the Statement of Activities, both governmental and
business-like activities are presented using the economic resources measurement focus as defined in item
b. below.
In the fund financial statements, the "current financial resources" measurement focus or the "economic
resources" measurement focus is used as appropriate:
a. All governmental funds utilize a "current financial resources" measurement focus. Only current
financial assets and liabilities are generally included on their balance sheets. Their operating
statements present sources and uses of available spendable financial resources during a given period.
These funds use fund balance as their measure of available spendable financial resources at the end
of the period.
b. The proprietary, pension, and private-purpose trust funds and financial statements of City
component units utilize an "economic resources" measurement focus. The accounting objectives of
this measurement focus are the determination of operating income, changes in net assets (or cost
recovery), financial position, and cash flows. All assets and liabilities (whether current or
noncurrent) associated with their activities are reported. Proprietary, pension, and private-purpose
trust fund equity is classified as net assets.
c. Agency funds are not involved in the measurement of results of operations; therefore, measurement
focus is not applicable to them.
Basis of Accounting
In the government-wide Statement of Net Assets and Statement of Activities, both governmental and
business-type activities are presented using the accrual basis of accounting generally including the
reclassification or elimination of internal activity (between or within funds). Under the accrual basis of
accounting, revenues are recognized when earned and expenses are recorded when the liability is incurred
or economic asset used.
In the fund financial statements, governmental funds are presented on the modified accrual basis of
accounting. Under this modified accrual basis of accounting, revenues are recognized when "measurable
and available." Measurable means knowing or being able to reasonably estimate the amount. Available
means collectible within the current period or within sixty days after year end. Expenditures (including
(Continued)
-59-
CITY OF PADUCAH, KENTUCKY
NOTES TO FINANCIAL STATEMENTS
FOR THE YEAR ENDED JUNE 30, 2012
Note 1 -Summary of Significant Account Policies:
Basis of Accounting
capital outlay) are recorded when the related fund liability is incurred, except for general obligation bond
principal and interest which are reported when due. Agency funds are presented using the accrual basis of
accounting.
All proprietary, pension, and private-purpose funds utilize the accrual basis of accounting. Under the
accrual basis of accounting, revenues are recognized when earned and expenses are recorded when the
liability is incurred or economic asset used.
Revenues-Exchange and Non-Exchange Transactions
Revenue resulting from exchange transactions, in which each party gives and receives essentially equal
value, is recorded on the accrual basis when the exchange takes place. On a modified accrual basis,
revenue is recorded in the fiscal year in which the resources are measurable and become available.
Available means that the resources will be collected within the current fiscal year or are expected to be
collected soon enough thereafter to be used to pay liabilities of the current fiscal year. For the City,
available means expected to be received within sixty days of year end.
Non-exchange transactions, in which the City receives value without directly giving equal value in return,
include employee license taxes, property taxes, grants, entitlements, and donations. The City considers
property taxes as available if they are collected within sixty days after year end. Revenue from grants,
entitlements, and donations is recognized in the year in which all eligibility requirements have been
satisfied. Eligibility requirements include timing requirements, which specify the year when the resources
are required to be used or the year when use is first permitted, matching requirements, in which the City
must provide local resources to be used for a specified purpose, and expenditure requirements, in which
the resources are provided to the City on a reimbursement basis. On a modified accrual basis, revenue
from non-exchange transactions must also be available before it can be recognized.
The revenues susceptible to accrual are taxes, intergovernmental, employer and employees' contributions
to trust funds, interest revenue, and charges for services. Permit revenues are not susceptible to accrual
because generally they are not measurable until received in cash.
Deferred/unearned revenue
The City reports unearned revenue on its government-wide statement of net assets and deferred revenue on
the fund financial statements. Deferred/unearned revenues arise when potential revenue does not meet
both the "measurable" and "available" criteria for recognition in the current period. Deferred/unearned
revenues also arise when resources are received by the City before it has a legal claim to them, as when
grant monies are received prior to the incurrence of qualifying expenditures. In subsequent periods, when
both revenue recognition criteria are met, or when the City has a legal claim to the resources, the liability
for deferred/unearned revenue is removed and revenue is recognized.
Allocation of Indirect Expenses
The City aJlocates indirect expenses primarily comprised of fleet management services and various self-
funded insurance coverage provided to departments and employees of the City not directly allocated.
Allocations are charged to functions based on use by weighted-average methodology.
Budgets and Budgetary Accounting
The City legally adopts annual budgets for all governmental and proprietary funds except for Section Eight
Housing Fund. The City follows these procedures in establishing the budgetary data reflected in these
financial statements:
(Continued)
-60-
CITY OF PADUCAH, KENTUCKY
NOTES TO FINANCIAL STATEMENTS
FOR THE YEAR ENDED JUNE 30,2012
Note 1 -Summary of Significant Accounting Policies:
Budgets and Budgetary Accounting
1. Prior to July, the City Manager submits to the City Commission a proposed operating budget for the
fiscal year commencing on July 1. The operating budget includes proposed expenditures and the
means of financing those.
2. Public hearings are conducted by the City to obtain taxpayer comments.
3. Prior to July, the budget is legally enacted through passage of an ordinance.
4. The City Manager is authorized to transfer budgeted amounts between department line items;
however, any revisions that alter the total expenditures of any department must be approved by the
City Commission.
5. Formal budgetary integration is employed as a management control device during the year; and, the
budget is legally adopted. Budget amendments are also legally adopted.
6. The budget is adopted on a basis (budget basis), which differs from generally accepted accounting
principles (GAAP basis).
Encumbrance accounting, under which purchase orders, contracts, and other commitments for the
expenditure of monies are recorded in order to reserve that portion of the applicable appropriation, is
employed as an extension of formal budgetary integration in the General Fund, Special Revenue Funds,
Debt Service Fund, and Capital Projects Funds. In accordance with generally accepted accounting
principles (GAAP), encumbrances outstanding at year end are reported as reservations of fund balances
since they do not constitute expenditures or liabilities. There are no encumbrances at June 30, 2012.
Cash and Investments
The City Council updated and adopted formal deposit and investment policies in January 2001. These
policies apply to all City funds not contained in public trusts. Pension trust fund has investment policies
separately approved by their oversight board. The private purpose trust has no adopted deposit and
investment policy.
For the purpose of the Statement of Net Assets, "cash and cash equivalents" includes all demand and
savings accounts of the City. For the purpose of the proprietary fund Statement of Cash Flows, "cash and
cash equivalents" include all demand and savings accounts and certificates of deposit, or short-term
investments with an original maturity of three months or less.
Investments are reported at fair value which is determined using selected bases. Short-term investments
are reported at cost, which approximates fair value. Securities traded on a national or international
exchange are valued at the last reported sales price at current exchange rates. Managed funds, related to
the pension and private purpose trust funds not listed on an established market, are reported at estimated
fair value as determined by the respective fund managers based on quoted sales prices of the underlying
securities. Cash deposits and certificates of deposit are reported at carrying amount which reasonably
estimates fair value. Additional cash and investment disclosures are presented in Note 3.
Receivables
In the government-wide statements, receivables consist of all revenues earned at year end and not yet
received. Major receivable balances for the governmental activities include property taxes, employee
earnings taxes, business licenses, insurance premiums taxes, franchise taxes, grant revenue, and interlocal
note receivables. Business-type activities report utilities and interest earnings as their major receivables.
(Continued)
-61-
CITY OF PADUCAH, KENTUCKY
NOTES TO FINANCIAL STATEMENTS
FOR THE YEAR ENDED JUNE 30, 2012
Note 1 -Summary of Significant Accounting Policies:
Receivables
The government-wide statements also include general obligation notes receivable related to the general
obligation bonds outstanding as described in Note 3. In the fund financial statements, receivables in
governmental funds include revenue accruals such as franchise tax, employee earnings taxes, business
licenses, insurance and grants, and other similar intergovernmental revenues since they are usually both
measurable and available.
Nonexchange transactions collectible but not available are deferred. Interest and investment earnings are
recorded when earned only if paid within sixty days since they would be considered both measurable and
available. Proprietary fund receivables include revenues earned at year end and not yet received. Utility
accounts receivable and interest earnings compose the majority of proprietary fund receivables.
Allowances for uncollectible accounts receivable are based upon historical trends and the periodic aging of
accounts receivable.
Interfund Receivables and Payables
During the course of operations, numerous transactions occur between individual funds that may result in
amounts owed between funds. Those related to goods and services type transactions are classified as "due
to and from other funds." Short-term interfund loans are reported as "interfund receivables and payables."
Long-term interfund loans (noncurrent portion) are reported as "advances from and to other funds."
Interfund receivables and payables between funds within governmental activities are eliminated in the
Statement of Net Assets. See Note 3 for details of interfund transactions, including receivables and
payables, at year end.
Inventories
Inventories are stated at cost on a first-in, first-out basis. Inventory consists of expendable supplies of
$76,888 held for consumption and real property of $1,098,306 held for urban development.
Capital Assets
The accounting treatment of property, plant and equipment (capital assets) depends on whether the assets
are used in governmental fund operations or proprietary fund operations and whether they are reported in
the government-wide or fund financial statements.
Government-wide Statement
In the government-wide financial statements, property, plant and equipment are accounted for as capital
assets. All capital assets are valued at historical cost, or estimated historical cost if actual is unavailable,
except for donated capital assets which are recorded at their estimated fair value at the date of donation.
Estimated historical cost was used to value the majority of the assets acquired prior to June 30, 2004.
Assets capitalized have an original cost of $500 or more prior to July I, 1999, $2,500 or more after July I,
1999, and $3,000 or more after June 24, 2009. Prior to July 1, 2002, governmental funds' infrastructure
assets were not capitalized. These assets have been valued at estimated historical cost.
(Continued)
-62-
CITY OF PADUCAH, KENTUCKY
NOTES TO FINANCIAL STATEMENTS
FOR THE YEAR ENDED JUNE 30, 2012
Note 1 -Summary of Significant Accounting Policies:
Capital Assets
Capital assets of the primary government are depreciated over the estimated useful lives using the straight-
line method. The estimated useful lives are as follows:
Land improvements
Buildings
Building improvements
Infrastructure
Equipment
Furnishings and fixtures
Vehicles
Fund Financial Statements
10-15 Years
30 Years
10-15 Years
15-30 Years
7-9 Years
3-5 Years
5-7 Years
In the fund financial statements, capital assets used in governmental fund operations are accounted for as
capital outlay expenditures of the governmental fund upon acquisition. Capital assets used in proprietary
fund operations are accounted for the same as in the government-wide statements.
Restricted Assets
Certain proceeds of enterprise fund revenue bonds, as well as certain resources set aside for their
repayment, are classified as restricted assets on the balance sheet because their use is limited to applicable
bond covenants.
Compensated Absences
Accumulated unpaid vacation, sick pay, and other employee benefit amounts are recorded as long-term
debt in the government-wide statements. The current portion of accrued compensated absences is
estimated based on historical trends. In the fund financial statements, governmental funds report only the
matured compensated absence liability payable from expendable available financial resources, while the
proprietary funds report the liability as it is incurred.
Accumulations for vacation pay are restricted to a maximum of 50 days and provide vesting rights upon
completion of six months service. Accumulations for sick pay are restricted to a maximum of 150 days
and provide payment to employees or beneficiaries for accumulations in excess of 50 days and up to 120
days upon death or retirement from City service. Qualified participants in the County Employee's
Retirement System, under certain circumstances, are eligible to convert accrued sick pay benefits into
additional credit for years of service upon retirement.
Long-Term Debt
The accounting treatment of long-term debt depends on whether the assets are used in governmental fund
operations or proprietary fund operations and whether they are reported in the government-wide or fund
financial statements.
All long-term debt to be repaid from governmental and business-type resources is reported as liabilities in
the government-wide statements. The long-term debt consists primarily of bonds payable, notes payable,
and accrued compensated absences.
Long-term debt for governmental funds is not reported as liabilities in the fund financial statements. The
debt proceeds are reported as other financing sources and payment of principal and interest as
expenditures. The accounting for proprietary funds is the same in the fund statements as it is in the
government-wide statements.
(Continued)
-63-
CITY OF PADUCAH, KENTUCKY
NOTES TO FINANCIAL STATEMENTS
FOR THE YEAR ENDED JUNE 30,2012
Note 1 -Summary of Significant Accounting Policies:
Equity Classifications
Government-wide Statements
Equity is classified as net assets and displayed in three components:
a. Invested in capital assets, net of related debt-Consists of capital assets including restricted capital
assets, net of accumulated depreciation and reduced by the outstanding balances of any bonds,
mortgages, notes, or other borrowings that are attributable to the acquisition, construction, or
improvement of those assets.
b. Restricted net assets -Consists of net assets with constraints placed on the use either by (I) external
groups such as creditors, grantors, contributors, or laws or regulations of other governments; or (2)
law through constitutional provisions or enabling legislation.
c. Unrestricted net assets -All other net assets that do not meet the definition of "restricted" or
"invested in capital assets, net of related debt."
Fund Statements
Governmental fund equity is classified as fund balance and displayed in five components:
a. Nonspendable fund balance includes amounts that are not in a spendable form or are required to be
maintained intact indefinitely.
b. Restricted fund balance includes amounts that can be spent only for the specific purpose stipulated
by creditors, grantors, contributors, or laws or regulations of other governments.
c. Committed fund balance includes amounts that can be used only for the specific purposes
determined by the City Commissioners through the approval of City ordinances. Commitments
may be changed or lifted only by the City Commissioners making the same formal action that
imposed the constraint originally.
d. Assigned fund balance comprises the amounts intended to be used for a specific purpose. Intent can
be expressed by the City Commissioners or the City Finance Officer, as stated in the Finance
Department Accounting Policy (FIN-20). No formal action is required.
e. Unassigned fund balance is the residual balance not contained in nonspendable fund balance or
restricted fund balance or committed fund balance or assigned fund balance.
When both restricted and unrestricted fund balances are available for use, it is the City's policy to use
restricted fund balance first, then unrestricted fund balance. Furthermore, committed fund balances are
reduced first, followed by assigned amounts, and then unassigned amounts when expenditures are
incurred for purposes for which amounts in any of those unrestricted fund balance classifications can be
used.
Proprietary fund equity is classified the same as in the government-wide statements.
Interfund Transactions
Interfund services provided and used are accounted for as revenues, expenditures, or expenses.
Transactions that constitute reimbursements to a fund for expenditures/expenses initially made from it that
are properly applicable to another fund, are recorded as expenditures/expenses in the reimbursing fund and
as reductions of expenditures/expenses in the fund that is reimbursed.
All other interfund transactions are reported as operating transfers.
(Continued)
-64-
CITY OF PADUCAH, KENTUCKY
NOTES TO FINANCIAL STATEMENTS
FOR THE YEAR ENDED JUNE 30,2012
Note 1 -Summary of Significant Accounting Policies:
Program Revenues
Amounts reported as program revenues include I) charges to customers or applicants for goods, services,
or privileges provided, 2) operating grants and contributions, and 3) capital grants and contributions,
including special assessments. Internally dedicated resources are reported as general revenues rather than
as program revenues. Likewise, general revenues include all taxes.
Operating and Non-Operating Revenues and Expenses -Proprietary Funds
Operating revenues and expenses for proprietary funds are those that result from providing services and
producing and delivering goods and/or services. It also includes all revenue and expenses not related to
capital and related financing, noncapital financing, or investing activities. Operating expenses for the
enterprise and internal service funds include the cost of sales and services, administrative expenses, and
depreciation on capital assets. All revenues and expenses not meeting this definition are reported as
nonoperating revenues and expenses.
Expenditures/Expenses
In the government-wide financial statements, expenses are classified by function for both governmental
and business-type activities.
In the fund financial statements, expenditures are classified as follows:
Governmental Funds -by character:
Proprietary Fund -by operating and nonoperating
Current (further classified by function)
Debt Service
Capital Outlay
In the fund financial statements, governmental funds report expenditures of financial resources.
Proprietary funds report expenses relating to use of economic resources.
Interfund Transfers
Permanent reallocation of resources between funds of the reporting entity are classified as interfund
transfers. For the purposes of the Statement of Activities, all interfund transfers between individual
governmental funds have been eliminated.
Use of Estimates
The preparation of financial statements in conformity with generally accepted accounting principles
requires management to make assumptions that affect reported amounts and disclosures. Accordingly,
actual results could differ from those estimates.
Stewardship, Compliance, and Accountability
By its nature as a local government unit, the City and its component units are subject to various federal,
state, and local laws and contractual regulations. An analysis of the City's compliance with significant
laws and regulations and demonstration of its stewardship over City resources follows.
(Continued)
-65-
CITY OF PADUCAH, KENTUCKY
NOTES TO FINANCIAL STATEMENTS
FOR THE YEAR ENDED JUNE 30,2012
Note 1 -Summary of Significant Accounting Policies:
Stewardship, Compliance, and Accountability
Fund Accounting Requirements
The City complies with all state and local laws and regulations requiring the use of separate funds.
Revenue Restrictions
The City has various restrictions placed over certain revenue sources from state or local requirements or
contractual agreements. The primary restricted revenue sources include.
Revenue Source
Section Eight Housing Choice Voucher Program
FEMA -Disaster Grants
American Recovery & Reinvestment Act Grants
HOME Investment Partnerships Grant
Emergency Communication Revenue
County Bed Tax
Homeland Security Grant Program
Kentucky Housing Corporation
Other Grants
Bond Proceeds
25% of Employee Earning Tax
Revenue Restrictions
Legal Restrictions of Use
Subsidize Rental Costs for Low-
Income Families
Debris Removal and Disaster Recovery
Job creation and retention
Construction of Low-income
Rental Units
E-911 Emergency Services
Debt Obligations
Homeland Security Enhancement
Fa~ade Loans
Grant Program Expenditures
Defeasance of debt and Capital Projects
Economic, Community and
Capital Development
For the year ended June 30, 2012, the City complied in all material respects with these revenue restrictions.
Debt Restrictions and Covenants
The City may not incur any indebtedness that would require payment from resources beyond the current
fiscal year revenue without first obtaining voter approval.
Subsequent Events
In preparing these financial statements, management has evaluated events and transactions for potential
recognition or disclosure through December 11, 2012, the date financial statements were available to be
issued.
Note 2 -Property Taxes:
The City bills and collects its own property taxes. The City elects to use the annual property assessment
prepared by McCracken County as its base to apply the property tax rate. According to Kentucky Revised
Statutes, the assessment date for the City must conform to the assessment date of McCracken County and
the annual increase in the property tax levy cannot exceed 4%. City property tax revenues are recorded as
a receivable when assessed because the City has an enforceable legal claim to the resources. At this time,
the receivable is offset by unearned revenue. Property tax revenues are recognized during the period for
which they are levied.
(Continued)
-66-
Note 2 -Property Taxes:
CITY OF PADUCAH, KENTUCKY
NOTES TO FINANCIAL STATEMENTS
FOR THE YEAR ENDED JUNE 30,2012
The due dates and collection period for all property taxes, exclusive of vehicle taxes, for the fiscal year
ended June 30, 2012, are as follows:
Description
Assessment and enforceable lien
Levy
Face value amount payment dates
Delinquent date -I 0% penalty
plus 1/2% per month
Note 3 • Detail Notes on Transaction Classes/ Accounts:
Date
January I, 20I1
September 25, 2011
1st half by November I, 20 I1
2nd half by February 1, 20 I2
1st half-November 30, 20I1
2nd half-February 29, 2012
The following notes present detail information to support the amounts reported in the basic financial
statements for its various assets, liabilities, equity, revenues, and expenditures/expenses.
Deposits
Custodial credit risk for deposits is the risk that in the event of a bank failure, the City's deposits may not
be returned or the City will not be able to recover collateral securities in the possession of an outside party.
The City's investment policy requires all investments be made in accordance with applicable legal
requirements with consideration of investment safety. Accordingly, the City maintains collateral
agreements with its financial institutions. Deposits are 10 I% secured with collateral valued at market or
par, whichever is lower, less the amount of the Federal Deposit Insurance Corporation insurance (FDIC).
The City Commission approves and designates a list of authorized depository institutions based on
evaluation of solicited responses and certifications provided by financial institutions and recommendations
of an evaluation committee and/or Finance Director.
Deposits
Deposits of the City's reporting entity are insured or collateralized with securities held by the City, its
agent, or by the pledging financial institution's trust department or agent in the name of City. During the
year ended June 30, 2012, the City's only cash and cash equivalents were demand deposits. At year end,
the carrying amount and the bank balance of the City's cash and cash equivalents were $20,392,045 and
$20,892,693, respectively.
(Continued)
-67-
CITY OF PADUCAH, KENTUCKY
NOTES TO FINANCIAL STATEMENTS
FOR THE YEAR ENDED JUNE 30,2012
Note 3 -Detail Notes on Transaction Classes/ Accounts:
Investments
As of June 30, 2012, the City's reporting entity had the following investments:
Fair Value/ Average Investment Maturities {In Years} {2}
Carrying Credit Quality/ Less Greater
TI,~es of Investments Amount Rating {1} Than 1 1-5 6-10 Than 10
Primary Government
Certificates of deposit (2) ~3z950z000 NA $3.950.000 $ -$ -$
TOTAL PRIMARY
GOVERNMENT $:\250 QQQ
Fiduciary and Private
Purpose Trust Funds
Money market funds $ 200.362 NA $ 200.362 $ -$ -$
Certificates of deposit (I) 50.000 NA 50.000
Common stock 2.552.720 NA NA NA NA NA
Corporate bonds 1,527.228 AlA-1.474.003 53,225
U.S. agencies 1,472.496 AAA/A 1,417,337 55.159
Mutual funds
Equity 2z888z959 NA NA NA NA NA
TOTALFIDUCIARY AND
PRIY ATE PURPOSE
TRUST FUNDS $8,621165
(I) Ratings are provided where applicable to indicate associated Credit Risk. NA indicates not applicable.
NR indicates that instrument is not rated.
(2) Maturities are provided for debt instruments with maturity dates. NA indicates not applicable.
(3) $50,000 of the fiduciary's certificates of deposit is pooled with the primary government's certificates of
deposit.
Investment Policies
City Policy
Credit Risk is the risk that an issuer or other counterparty to an investment will not fulfill its obligations.
Generally, the City's investing activities are managed under the custody of the City's Finance Director.
Investing is performed in accordance with investment policies adopted by the City Commission complying
with State Statutes. In accordance with the City's investment policy and the State Statutes, the City may
invest funds temporarily in excess of operating needs in the following:
Kentucky Revised Statutes (KRS 66.480) authorize the City to invest in:
1. Obligations of the U.S. Treasury, agencies, and instrumentalities, including obligations subject to
repurchase agreements, provided delivery of obligations subject to repurchase agreements are held
by the City or through an authorized agent;
2. Obligations and contracts for future delivery or purchase of obligations backed by the full faith and
credit of the United States or a United States government agency;
3. Obligations of any corporation of the United States government;
(Continued)
-68-
CITY OF PADUCAH, KENTUCKY
NOTES TO FINANCIAL STATEMENTS
FOR THE YEAR ENDED JUNE 30, 2012
Note 3-Detail Notes on Transaction Classes/Accounts:
Investment Policies
City Policy
4. Bonds or certificates of indebtedness of the Commonwealth of Kentucky and of its agencies and
instrumentalities;
5. Certificates of deposit issued by or other interest-bearing accounts of any bank or savings and loan
institution which are insured by the Federal Deposit Insurance Corporation or similar entity or which
are collateralized, to the extent uninsured, by any obligations permitted by section 4I.240( 4) of the
Kentucky Revised Statutes;
6. Securities issued by a state or local government, or any instrumentality or agency thereof, in the
United States, and rated in one of the three highest categories by a national recognized rating
agency.
Interest Rate Risk is the risk that changes in interest rates will adversely affect the fair value of an
investment. The City policy provides that, to the extent practicable, investments are matched with
anticipated cash flows. Investments are diversified to minimize the risk of loss resulting from
overconcentration of assets in a specific maturity period, a single issuer, or an individual class of
securities. Unless matched to a specific cash flow, investments are not, in general, made in securities
maturing more than five years from the date of purchase. Surplus cash may be invested in securities
exceeding five years if the maturity of such investments is made to coincide as nearly as practicable with
the expected use of the investment. Concentration of credit risk is the risk of loss attributed to the
magnitude of the City's investment in a single issuer. The City policy does not specifically address
concentration of credit risk.
Pension Trust Policy
The City's pension trust is the Police and Firefighters' Pension Fund (PFPF). Investment policy provides
for investment manager(s) who have full discretion of assets allocated to them subject to the overall
investment guidelines set out in the policy. Overall investment guidelines provide for diversification and
allow investment in domestic and international common stocks, fixed income securities, and cash
equivalents. Custodial credit risk is addressed by the policy providing for the engagement of a custodian
who accepts possession of securities for safekeeping; collects and disburses income; collects principal of
sold, matured, or called items; and provides periodic accounting to the pension board.
Asset allocation guideline for the plan is as follows:
Equities
Fixed income
PFPF Retirement Plan
Minimum Target Maximum
35% 50% 65%
35% 50% 65%
The retirement plan addresses credit risk and concentration of credit risk with a policy that prohibits
investment of more than 5% of its assets in the securities of any one issuer with the exception of U.S.
government. Policy further prohibits investment of more than 20% in any one market sector. No more
than 10% of corporate debt securities in the fixed income portfolio may be rated below-investment grade.
Commercial paper must be rated A I, PI.
(Continued)
-69-
CITY OF PADUCAH, KENTUCKY
NOTES TO FINANCIAL STATEMENTS
FOR THE YEAR ENDED JUNE 30,2012
Note 3 -Detail Notes on Transaction Classes/ Accounts:
Investment Policies
Pension Trust Policy
Interest rate risk is addressed by the policy requiring the plan manager(s) to maintain both diversification
and a predictable and dependent source of current income. Fixed income investments are flexibly
allocated among maturities of different lengths.
Private Purpose Trust
The private purpose trust does not have a formal investment policy. The City established the trust in
accordance with Kentucky Revised Statutes. The trust provides for an investment manager who has full
discretion of assets allocated to him subject to the provisions of the trust agreement. The trust invests in
domestic and international mutual funds, fixed income securities, U.S. treasury securities, and cash and
equivalents.
Capital Assets
Capital asset activity for the year ended June 30, 2012, was as follows:
Primary Government:
Capital assets, not being depreciated:
Land
Construction-in-progress
Total capital assets, not being
depreciated
Capital assets, being depreciated:
Land improvements
Buildings and improvements
Infrastructure
Equipment
Furnishings and fixtures
Vehicles
Totals at historical cost
Less accumulated depreciation:
Land improvements
Buildings and improvements
Infrastructure
Equipment
Furnishings and fixtures
Vehicles
Total accumulated depreciation
Total capital assets, being
depreciated, net
Balance
.July 1, 2011 Additions
$ 7,394,561 $ 3,713,314
7.150.928 423.010
14.545.489 4.136.324
3,061,972 359,942
17,257,912
38,692,027 6,297
9,509,689 467,815
210,980
726702737 9622288
76.403,317 12796.342
1,418,792 100,595
12,006,697 340,703
23,701,156 1,648,091
7,506,248 679, I 93
208,424 1,034
521792541 553A47
5020202858 3.3232063
262382A59 (125262 721)
Balance
Deductions J one 30, 2012
$ $11,107,875
3,776.376 3,797.562
3.776.376 14.905.437
3,421,914
17,257,912
38,698,324
215,766 9,761,738
3,150 207,830
4232905 822092120
6422821 7725562838
1,519,387
12,347,400
25,349,247
211,903 7,973,538
3,150 206,308
4062673 523262315
62L726 5227222195
212095 2428342643
PRIMARY GOVERNMENT
ACTIVITIES CAPITAL
ASSETS, NET $40.927.948 $ 2.609.603 $3 797.471 $39.740.080
(Continued)
-70-
CITY OF PADUCAH, KENTUCKY
NOTES TO FINANCIAL STATEMENTS
FOR THE YEAR ENDED JUNE 30,2012
Note 3-Detail Notes on Transaction Classes/Accounts:
Capital Assets
Business-type Activities:
Capital assets, not being depreciated:
Land
Construction-in-progress
Total capital assets, not being
depreciated
Capital assets, being depreciated:
Buildings and improvements
Equipment
Vehicles
Totals at historical cost
Less accumulated depreciation:
Buildings and improvements
Equipment
Vehicles
Total accumulated depreciation
Total capital assets, being
depreciated, net
BUSINESS-TYPE ACTIVITIES
CAPITAL ASSETS, NET
Balance
.July 1, 2011 Increases
$ 62,152 $
62.152
429,254 125,573
1,594,673 105,782
2~6102696 1382110
4.6342623 369.465
223,948 14,818
1,222,576 146,690
129162021 2332613
3,362545 3952121
12722078 (25.656)
$ 1 33~b230 $ (25!656)
Depreciation expense was charged to governmental activities as follows:
General government:
General administration
Finance
Planning
Inspections
Personnel
Information systems
Fleet maintenance
Total general government
Public safety:
Police
Fire
Grants
Emergency 911
Court awards
Fleet Lease Trust
Total public safety
-71-
Balance
Decreases J one 30, 2012
$ $ 62,152
128,588
1732266
301.854
128,588
1732266
301.854
$
62.152
554,827
1,571,867
225752540
427022234
238,766
1,240,678
12976~368
3.4552812
1246.422
$ 1!308!514
$ 275,153
36,805
4,532
2,708
92903
329.101
240,724
68,955
62,248
11,913
568.418
952258
(Continued)
CITY OF PADUCAH, KENTUCKY
NOTES TO FINANCIAL STATEMENTS
FOR THE YEAR ENDED JUNE 30, 2012
Note 3-Detail Notes on Transaction Classes/Accounts:
Capital Assets
Public service:
Public works
Engineering
Total public service
Parks and recreation
Planning and development:
Infrastructure
Grants
Total planning and development
TOTAL DEPRECIATION EXPENSE-
GOVERNMENTAL ACTIVITIES
Depreciation expense was charged to business-type activities as follows:
Solid Waste Fund
Section Eight Housing
Civic Center
TISA Fund
TOTAL DEPRECIATION EXPENSE-
BUSINESS-TYPE ACTIVITIES
-72-
$ 58,019
46.032
104.051
172.900
1,762,882
1.871
1.764.753
$3 323.063
$ 346,166
5,639
10,209
33.107
$ 395.121
(Continued)
CITY OF PADUCAH, KENTUCKY
NOTES TO FINANCIAL STATEMENTS
FOR THE YEAR ENDED JUNE 30,2012
Note 3 -Detail Notes on Transaction Classes/ Accounts:
Capital Assets
Balance
Discretely Presented 1}UII 12 2011 Increases
Component Units:
Capital assets, not being depreciated:
Land $ 486.314 $
Total capital assets, not being
depreciated 486.314
Capital assets, being depreciated:
Buildings and improvements 1,845,615 31,638
Equipment 7,686,334 1,259,053
Utility plant 69.609.437 2.904.899
Total capital assets, being
depreciated 79,141.386 4.195.590
Less accumulated depreciation:
Buildings and improvements 972,414 108,814
Equipment 4,228,037 1,018,144
Utility plant 28.337.751 1.481.840
Total accumulated depreciation 33.538.202 2.608.798
Total capital assets, being
depreciated, net 45.603.184 1.586.792
COMPONENT UNIT
CAPITAL ASSETS, NET $46.089.498 $1.586.792
Balance
Decreases June 302 2012
$ $ 486,314
486,314
1,877,253
1,436,994 7,508,393
36.160 72.478.176
1.473.154 81.863.822
1,081,228
1,370,687 3,875,494
36.160 29.783.431
1.406,847 34.740.153
66.307 47.123,669
$ 66.307 $47.609 983
Depreciation expense, charged to functions/programs of discretely presented major component units as
follows:
Paducah Water Works
Paducah Transit Authority
TOTAL DEPRECIATION EXPENSE BY ACTNITY
Accounts Payable
$ 1,481,840
1.126.958
$ 2.608.798
Payables in the governmental and proprietary funds are composed of payables to vendors and accrued
salaries and benefits.
(Continued)
-73-
CITY OF PADUCAH, KENTUCKY
NOTES TO FINANCIAL STATEMENTS
FOR THE YEAR ENDED JUNE 30,2012
Note 3-Detail Notes on Transaction Classes/Accounts:
Long-Term Liabilities
The City's long-term liabilities are segregated between the amounts to be repaid from governmental
activities and amounts to be repaid from business-type activities.
Governmental Activities
As of June 30, 2012, the governmental long-term liabilities consisted of the following:
General obligation bonds:
Current portion
Noncurrent portion
TOTAL GENERAL OBLIGATION
BOND COSTS
Note payable:
Current portion
Noncurrent portion
TOTAL NOTE PAY ABLE PAYMENTS
Accrued compensated absences:
Current portion
Noncurrent portion
TOTAL ACCRUED COMPENSATED
ABSENCES
Business-type Activities
$ 1,289,587
22.361.906
$23 651.493
$ 366,923
6.953.406
$ 7.320.329
$ 1,008,012
1.020.206
$ 2 028.218
As of June 30, 2012, the long-term liabilities payable from proprietary fund resources consisted of the
following:
Accrued compensated absences:
Current portion
Noncurrent portion
TOTAL ACCRUED COMPENSATED
ABSENCES
-74-
$ 92,323
14.414
$ 106.737
(Continued)
CITY OF PADUCAH, KENTUCKY
NOTES TO FINANCIAL STATEMENTS
FOR THE YEAR ENDED JUNE 30, 2012
Note 3-Detail Notes on Transaction Classes/Accounts:
Long-Term Liabilities
General Obligation Bonds
Series 2005 Bond Issue-The City of Paducah issued general obligation bonds of $6,100,000 in November
2005, to finance the police and firefighter's pension fund estimated actuary liability. Interest rate is fixed
at 5.35%. These bonds are required to be fully paid within 20 years from the date of issue and are backed
by the full faith and credit of the City.
Series 2008 Bond Issue -The City of Paducah issued general obligation bonds of $2,800,000 in March
2009, to finance the Floodwall Rehabilitation. Interest rates are variable. These bonds are required to be
fully paid within 20 years from the date of issue and are backed by the full faith and credit of the City.
Series 2010 Bond Issue -The City of Paducah issued general obligation Build America Bonds of
$6,645,000 in March 2010, to finance several public improvement projects. Interest rates range from
1.00% to 5.50%, with a Federal subsidy equal to 35% of the interest payments. These bonds are required
to be fully paid within 20 years from the date of issue and are backed by the full faith and credit of the
City.
Series 2010B Bond Issue-The City of Paducah issued general obligation bonds of $7,165,000 in August
2010 with interest rates ranging between 1% and 3.25%, to advance refund $6,725,000 of outstanding
2001 series bonds with interest rates ranging between 4.5% and 5%. These bonds are required to be fully
paid within 16 years from the date of issue and are backed by the full faith and credit of the City.
While these 2010B series bonds are issued by the City, 50% of the principal amount of the bonds was
issued on behalf of the County of McCracken, Kentucky which intends to participate on an equal basis
with the City in financing the projects and has issued the City a general obligation note in a principal
amount equal to 50% of the principal amount of the bonds and bearing interest at the same rates as the
City's bonds in order to secure the County's obligations to the City. This note receivable is reflected in the
government-wide Statement of Net Assets. In accordance with an Interlocal Cooperation Agreement
between the City, McCracken County, Kentucky (the County), and the Paducah-McCracken County
Tourist and Convention Commission (the Bureau), principal and interest payments on the bonds are being
made from an additional 2% transient room tax collected by the County with the remaining payments split
evenly between the City, the County, and the Bureau.
Series 2011 Bond Issue -The City of Paducah issued general obligation taxable refunding bonds of
$3,910,000 in August 2011 with an interest rate of 3.68%, to currently refund $3,780,000 of outstanding
2004 series bonds with interest rates ranging from 2.25% to 6%. These bonds are required to be fully paid
within 13 years from the date of issue and are backed by the full faith and credit of the City.
The net proceeds were placed in an escrow account and used to call $3,780,000 of outstanding 2004 series
bonds. In the Statement of Net Assets, the net costs associated with the early retirement of the issues are
deferred and amortized over the remaining life of the defeased debt. The amount deferred is reported as a
decrease to the book value of the new debt issued to finance the refunding. Total deferred costs were
$66,065. Amortization for the year was $7,347 and is included as a component of interest expense.
The City advance refunded the 2004 series bonds to reduce its total debt service payments over the next 13
years by $591,765 and to obtain an economic gain (the difference between the present values of the debt
service payments on the old debt and the new debt) of $540,961.
(Continued)
-75-
CITY OF PADUCAH, KENTUCKY
NOTES TO FINANCIAL STATEMENTS
FOR THE YEAR ENDED JUNE 30, 20I2
Note 3 -Detail Notes on Transaction Classes/ Accounts:
Long-Term Liabilities
General Obligation Bonds
Series 20 II Bond Issue -While these bonds are issued by the City, 50% of the principal amount of the
bonds was issued on behalf of the County of McCracken, Kentucky which intends to participate on an
equal basis with the City and has guaranteed 50% of the principal amount of the bonds. The amounts
being collected from a lease with Infiniti Plastic Technologies, Inc is sufficient to cover the entire bond
payments due. The County will not be required to make any payments unless Infiniti Plastic
Technologies, Inc. defaults on lease payments. Therefore, no receivable from the County has been
recorded in the government-wide financial statements.
Notes Payable
Kentucky League of Cities -On July I, 2003, the City entered into an agreement in the amount of
$3,500,000 with the Kentucky League of Cities to finance the acquisition and installation of various public
capital projects. Interest is charged at a rate of approximately 2.98%. The note is required to be fully paid
within 20 years from the date of issue and is backed by the full faith and credit of the City.
Kentucky Association of Counties -The County of McCracken, Kentucky entered into an agreement in
the amount of $5,000,000 in March 2009, with the Kentucky Association of Counties to assist with the
Julian Carroll Convention Center. The interest rate is variable. The note is required to be fully paid within
20 years from the date of issue and is backed jointly by the full faith and credit of the City and the County.
While the note is issued by the County, 50% of the principal amount of the note was issued on behalf of
the City which intends to participate on an equal basis with the County in accordance with an Interlocal
Cooperation Agreement between the City and McCracken County, Kentucky on February 23, 2009.
Margaret Hank Agreement -On June 16, 2011, the City entered into an agreement in the amount of
$I88,533 with Margaret Hank to finance the acquisition of real property to be used for the development of
a an indoor recreational facility. The note matures on July I, 2019 and has an imputed interest rate of
3.25%.
Murray State University Paducah Agreement -On November 22, 20 II, the City entered into a general
obligation note in the amount of $2,674,093 with McCracken County to finance the construction of an
educational facility to be occupied by Murray State University. The note matures on December I, 203I
and has interest rates ranging from 1.0% to 3.5%.
(Continued)
-76-
CITY OF PADUCAH, KENTUCKY
NOTES TO FINANCIAL STATEMENTS
FOR THE YEAR ENDED JUNE 30,2012
Note 3-Detail Notes on Transaction Classes/Accounts:
Long-Term Liabilities
Changes in Long-Term Liabilities
The following is a summary of changes in long-term debt for the year ended June 30, 2012:
Type of Liability:
Governmental activities:
General obligation bonds:
Infiniti Media Building
Pension
Floodwall Rehabilitation
Build America Bonds
Beginning
Balance
$ 3,780,000
5,125,000
2,564,948
6,370,000
7,040,000 Refinanced Convention Center
Refinanced Infiniti Media
Building
Notes payable:
Kentucky League of Cities
Kentucky Association of
Counties
Margaret Hank Agreement
Murray State University
Agreement
Accrued compensated absences
2,358,171
2,364,039
188,533
L929:712
Deferred
Cost
Additions Reductions Amortization
$ -$ 3,780,000 $
3,910,000
2,674,093*
897:990
230,000
109,738
270,000
410,000
280,000
164,441
87,789
12,278
799,484
(58,717)
$
Ending
Balance
-
4,895,000
2,455,210
6,100,000
6,630,000
3,571,283
2,193,730
2,276,250
176,255
2,674,093
2:028:218
Amounts
Due within
One Year
$
240,000
113,420
275,000
410,000
251,167
169,437
86,875
110,611
1:008:012
TOTAL GENERAL LONG-
TERM LIABILITIES $31 720 403 $ 7.482.083 $ 6 143.730 $ (58 717) $33 000 039 $2.664.522
Business-type activities:
Accrued compensated
Absences $ 88.626 $ 59,077 $ 40.966 =$ === $ 106.737 $ 92.323
*Assumption of 50% of McCracken County debt for facility construction. This transaction did not create or
use current financial resources and, therefore, was not reported as another financing source on the Statement of
Revenues, Expenditures, and Changes in Fund Balances Governmental Funds.
( 1) The calculation to reconcile amounts in this schedule to the "net assets invested in capital assets, net of
related debt" for governmental activities is:
Net Capital Assets $39,740,080
Less:
19.75% of the outstanding 2001
general obligation bonds
Net of the County's portion
78% of the outstanding 2010
general obligation bonds
I 00% of the Margaret Hank Agreement
100% of the outstanding Kentucky League
of Cities' note payable
Net assets invested in capital assets, net of related debt
-77-
$(I ,309,425)
654.7II
(654,714)
(4,758,000)
(176,255)
(2.193.730)
$31.957.38I
(Continued)
CITY OF PADUCAH, KENTUCKY
NOTES TO FINANCIAL STATEMENTS
FOR THE YEAR ENDED JUNE 30, 2012
Note 3-Detail Notes on Transaction Classes/Accounts:
Long-Term Liabilities
Annual Debt Service Requirements
The annual debt service requirements to maturity, excluding obligations associated with compensated
absences, for long-term debt as of June 30, 2012, are as follows:
Year Ending
.June 30
2013
2014
2015
2016
2017
2018-2022
2023-2027
2028-2032
TOTALS
Accrued Compensated Absences
Principal
$ 1,656,510
1,714,616
1,779,697
1,841,968
1,899,140
10,482,318
8,913,319
2.684.253
$30.971 .821
Interest
$ 1,040,986
1,009,656
971,808
920,532
865,998
3,357,528
1,473,398
234.707
$ 9 874.613
Federal
Interest
Subsidy
$ (93,684)
(91,759)
(89,554)
(86,614)
(83,315)
(351,542)
(216,963)
(48.437)
$(I .061 .868)
Compensated absence obligations arise from amounts due to City employees for vested amounts of
vacation pay and sick pay which will be payable in the future. Typically, the compensated absence
obligations have been paid by the General Fund, Emergency Communication Service Fund, Section Eight
Housing Fund, Solid Waste Fund, and Fleet Maintenance Fund. Amounts accrued at June 30, 2012, are as
follows:
Accrued Compensated Absences
Accrued sick leave
Accrued vacation leave
Totals
Less current portion
LONG-TERM PORTION
Termination Benefits
Governmental
Activities
$ 774,400
1.253.818
2,028,218
1.008.012
$1.020.206
Business-type
Activities
$ 36,805
69.932
106,737
92.323
$ 14.414
Ten employees, through employment contracts, are entitled to certain termination benefits upon
involuntary termination of employment by the City Commission. These benefits include provision for
salary payments for three to six months, as well as, certain health, life, dental, and disability insurance
coverage for same period of time. As these benefits are only provided for involuntary termination of
employment, no provision has been made for these benefits. The City funds these benefits on a pay-as-
you-go basis in the period incurred. No termination benefits were paid for the year ended June 30, 2012.
(Continued)
-78-
CITY OF PADUCAH, KENTUCKY
NOTES TO FINANCIAL STATEMENTS
FOR THE YEAR ENDED JUNE 30, 2012
Note 3 -Detail Notes on Transaction Classes/ Accounts:
Termination Benefits
In addition, qualified participants in the County Employee's Retirement System (CERS), under certain
circumstances are eligible to convert accrued sick pay benefits into additional credit for years of service
upon retirement. Costs and notification of payment for these benefits are not calculated by the CERS
actuary until a qualified participant submits an application for retirement benefits. Accordingly, no
provision has been made for these benefits; and, the City funds these benefits in the period of notification
for payment by the CERS. For the year ended June 30, 2012, payments of $5,840 were made for these
benefits.
Landfill Closure and Post-Closure Costs
The County of McCracken, Kentucky (County) closed the local landfill to the public on June 30, 1995.
The County must comply with established state and federal landfill closure procedures and must perform
maintenance and monitoring procedures at the site for thirty years after closure. The 30-year period will
begin upon approval from the Commonwealth of Kentucky regarding the environmental condition of the
landfill site. As of June 30, 2012, approval had not yet been granted. The County estimated post-closure
care costs totaling $4,125,000 or $125,000 per year plus 10% for inflation. Actual costs may be higher due
to inflation, changes in technology, or changes in regulations. In the year ending June 30, 2001, the City
entered into an inter-local agreement to share equally the costs for post-closure costs and, accordingly, has
recorded a long-term liability for 50% of the estimated closure expense. It is anticipated that post-closure
costs will be paid out of the Solid Waste Fund to the extent that funds are available with any excess costs
being funded using long-term borrowing.
Interfund Transactions and Balances
lnterfund transfers during the year ended June 30, 2012, were as follows:
Interfund Interfund
Governmental Funds: Transfers In Transfers Out
General Fund $ 834,534 $1,641,755
Capital Project Fund 1,822,397 514,712
Special Revenue Investment Fund 110,988 3,237,151
Special Revenue Bond Fund
Debt Service Fund 1,560,103
Nonmajor Governmental Funds 1,560,825 415,921
Internal Service Funds 196,462 5,149
Proprietary Funds:
Solid Waste 247,725
Nonmajor Proprietary Funds 27.104 50.000
TOTALS $6 112.413 $6! 112!413
Transfers are used to (a) move revenues from the fund that statute or budget requires to collect them to the
fund that statute or budget requires to expend them and to (b) use unrestricted revenues collected in the
general fund to finance various programs accounted for in other funds in accordance with budgetary
authorizations.
(Continued)
-79-
CITY OF PADUCAH, KENTUCKY
NOTES TO FINANCIAL STATEMENTS
FOR THE YEAR ENDED JUNE 30,2012
Note 3 -Detail Notes on Transaction Classes/ Accounts:
Due To/From Balances
Due to/from balances used to cover current operating expenses were as follows as of June 30, 2012:
General Fund
Special Revenue Investment Fund
Nonmajor Proprietary Funds
Internal Service Funds
TOTALS
Note 4 -Pension Plans -City of Paducah:
Due From
$ 45,918
1,028,999
510.810
$1!585!222
Due To
$1,539,809
45,918
$1!585!222
The City provides retirement benefits to its employees through three pension funds. Two of these funds
are single-employer defined benefit funds and are administered by the City. These funds are Police and
Firefighters' Pension Fund (PFPF) and Appointive Employee' Pension Fund (AEPF). The other pension is
a multi-employer public employee retirement fund administered by the Kentucky County Employees
Retirement System (CERS). The City also participates in three deferred compensation plans. Information
regarding these plans follows:
Single Employer Defined Benefit Funds (Police and Firefighters' Pension Fund and Appointive
Employees Pension Fund)
Basis of Accounting -The financial statements are prepared using the accrual basis of accounting.
Plan member and employer contributions are recognized in the period in which the contributions are
due, pursuant to formal commitments. Benefits and refunds are recognized when due and payable in
accordance with the terms of each plan.
Single Employer Defined Benefit Funds (Police and Firefighters' Pension Fund and Appointive
Employees Pension Fund)
Funding -The Appointive Employee's Pension Fund Board and the City of Paducah Police and
Firefighter's Pension Fund Board are responsible for establishing or amending contribution rates and
requirements for their respective plans.
Administrative Costs-Administrative costs are funded from investment earnings.
Valuation of Investments -Investments are reported at fair value. Investments are composed of
securities valued at current market prices.
(Continued)
-80-
CITY OF PADUCAH, KENTUCKY
NOTES TO FINANCIAL STATEMENTS
FOR THE YEAR ENDED JUNE 30,2012
Note 4 -Pension Plans -City of Paducah:
Police and Firefighters' Pension Fund
Plan Description: PFPF is a single-employer defined benefit plan. On August 1, 1988, the plan was
closed to new entrants and current active duty police and firemen of the City were given a choice of
remaining in this plan or transferring into the CERS. Effective August 1, 1988, the PFPF covered 21
active duty members. All other active duty members elected coverage under CERS. PFPF provides
retirement, disability, and death benefits to plan members and their beneficiaries. These benefits are
determined by Kentucky Revised Statutes (KRS) sections 95.851 to 95.884. PFPF does not issue a
separate, stand-alone report. Accordingly, the plan financial statements are included in this audit report.
Contributions: Plan members are required to contribute 8% of their annual covered salary. A member
reserve is established for member contributions, less amounts transferred to reserves for retirement and
disability and amounts refunded to terminated employees.
Funding: As of the most recent actuarial valuation dated July 1, 2012, the schedule of funding progress
was as follows:
Actuarial Actuarial Unfunded Annual UAALasa
Value of Accrued AAL Funded Covered Percentage of
Assets Liability (AAL) (UAAL) Ratio Payroll Covered
(a} (b} (b-a} (alb} (c} ((b-a}/c}
$7,567,321 $12,000,339 $4,433,018 63.1 $77,148 5,746.12%
A schedule of the funded status and funding progress for the previous six years can be found on page
91, which contains trend information about the changes in actuarial value of the plan assets relative to
the actuarially determined liability for benefits over time.
Components of annual pension cost for PFPF are as follows:
Year Ended Year Ended Year Ended
Component June 30~ 2012 ,June 30~ 2011 ,June 30~ 2010
Beginning NPO balance $(5,457 .076) $(5.511.936) $(5.551.753)
ARC 361,701 455,139 460,892
Interest on NPO (436,566) (440,955) (444,140)
Unfunded ARC adjustment 495.341 492.104 488.235
Pension cost 420,476 506,288 504,987
Less actual contribution 391.744 451.428 465.170
Net change in NPO 28.732 54.860 39.817
ENDING NPO BALANCE $(5 428.344) $(5.457.076) $(5.51 1.936)
PERCENTAGE OF PENSION
COST CONTRIBUTED 23% _82% 22%
(Continued)
-81-
CITY OF PADUCAH, KENTUCKY
NOTES TO FINANCIAL STATEMENTS
FOR THE YEAR ENDED JUNE 30, 2012
Note 4 -Pension Plans -City of Paducah:
Police and Firefighters' Pension Fund
The financial statements for the Police and Firefighters' Pension Fund are as follows:
Assets:
Cash and cash equivalents
Receivables
Investment at fair value
Total assets
Liabilities:
Statement of Fiduciary Net Assets
Police and Firefighters' Retirement Fund
June 30, 2012
Voucher and accounts payable
Net Assets:
Held in trust for pension benefits and
other purposes
Statement of Changes in Net Assets
Police and Firefighters' Retirement Fund
For the Year Ended June 30, 2012
Additions:
Employer contributions
Plan members' contributions
Total contributions
Investment earnings:
Net decrease in fair value of investments
Interest and dividends
Net investment earnings
Total additions
Deductions:
Benefits
Administrative expenses
Total deductions
Change in net assets
Net assets, July I, 2011
NET ASSETS, JUNE 30, 2012
-82-
$ 4,436
27,241
7.535.700
7,567,377
56
$ 7.567.321
$ 391,744
7.548
399.292
( 122,860)
246.201
123.341
522.633
1,621,008
49.712
1.670.720
( 1' 148,087)
8.715.408
$ 7.567.321
(Continued)
CITY OF PADUCAH, KENTUCKY
NOTES TO FINANCIAL STATEMENTS
FOR THE YEAR ENDED JUNE 30,2012
Note 4 -Pension Plans -City of Paducah:
Appointive Employees' Pension Fund
Plan Description: AEPF is a single-employer defined benefit plan which covers past appointed
employees of the City. In 1975, the City froze admission of new entrants into the plan. There are no
active participants in the plan at June 30, 2012. AEPF does not issue a separate, stand-alone report.
Accordingly, the plan financial statements are included in this audit report.
Contributions: Since there are only retired employees and beneficiaries receiving benefits, the City
expects little or no additional pension obligation. The City has pledged to maintain benefits and the
financial soundness of the plan by appropriations from the General Fund, as necessary.
Funding: As of the most recent actuarial valuation dated July 1, 2012, the schedule of funding progress
was as follows:
Actuarial Unfunded Annual UAALasa
Value of Accrued AAL Funded Covered Percentage of
Assets Liability (AAL) (UAAL) Ratio Payroll Covered
(a) (b) (b-a) (a/b) (c) ((b-a)/c)
$106,983 $154,679 $47,696 69.2 nla* nla*
A schedule of the funded status and funding progress for the previous six years can be found on page
91, which contains trend information about the changes in actuarial value of the plan assets relative to
the actuarially determined liability for benefits over time.
Components of annual pension cost for AEPF are as follows:
Year Ended Year Ended Year Ended
Component June 302 2012 .Iune 302 2011 1]une 302 2010
Beginning NPO balance $(177,856) $(194.904) $(227.510)
ARC 7,722 3,760 17,095
Interest on NPO (10,671) (11 ,694) (13,651)
Unfunded ARC adjustment 22.797 24.982 29.162
Pension cost 19,848 17,048 32,606
Less actual contribution
Net change in NPO 19.848 17.048 32.606
ENDING NPO BALANCE $(]58.008) $(177.856) $()94 904)
PERCENT AGE OF PENSION
COST CONTRffiUTED _Q% _Q% _Q%
(Continued)
-83-
CITY OF PADUCAH, KENTUCKY
NOTES TO FINANCIAL STATEMENTS
FOR THE YEAR ENDED JUNE 30,2012
Note 4 • Pension Plans • City of Paducah:
Appointive Employees' Pension Fund
The financial statements for the Appointive Employees' Pension Fund are as follows:
Assets:
Cash and cash equivalents
Receivables
Investment at fair value
Total assets
Liabilities:
Statement of Fiduciary Net Assets
Appointive Employees' Pension Fund
June 30, 2012
Voucher and accounts payable
Net Assets:
Held in trust for pension benefits and
other purposes
Additions:
Interest and dividends
Employer contributions
Total additions
Deductions:
Benefits
Administrative expenses
Total deductions
Change in net assets
Net assets, July 1, 2011
NET ASSETS, JUNE 30, 2012
Statement of Changes in Net Assets
Appointive Employees' Pension Fund
For the Year Ended June 30, 2012
$ 56,560
449
50.000
107,009
26
$106.983
$ 1,716
1.716
24,610
7.141
31.751
(30,035)
137.018
$106.983
Single Employer Defined Benefit Funds (Police and Firefighters' Pension Fund and Appointive
Employees Pension Fund)
Contribution Information
A summary of actuarial assumptions at June 30, 2012, the date of the latest actuarial valuation is as
follows:
(Continued)
-84-
CITY OF PADUCAH, KENTUCKY
NOTES TO FINANCIAL STATEMENTS
FOR THE YEAR ENDED JUNE 30, 2012
Note 4 -Pension Plans -City of Paducah:
Single Employer Defined Benefit Funds (Police and Firefighters' Pension Fund and Appointive
Employees Pension Fund)
Contribution Information
PFPF AEPF
Valuation date 711112 7/1112
Actuarial cost method Entry age normal Aggregate ( I)
Amortization method Level dollar closed Level dollar closed
Remaining amortization period 22 Years 10 Years
Asset valuation method Market value Market value
Actuarial assumptions:
Investment rate of return 8.00% 6.0%
Projected salary increases 4.00% (2)
Inflation rates adjustments 3.00% (2)
( 1) The Aggregate Method does not identify or separately amortize the unfunded actuarial
liabilities. Information about funded status and funding progress is presented using the entry
age actuarial cost method for that purpose; and, that information presented is intended to serve
as a surrogate for the funding progress of the plan.
(2) The plan has no active participants. The pension cost for each year is determined as an
amortization of the unfunded actuarial accrued liability over the lesser of 10 years or the
weighted average of expected term of payment of plan benefits.
Membership Information
Membership of each plan consisted of the following at June 30, 2012:
PFPF AEPF
Active participants 1 0
Beneficiaries 39 3
Retired participants 32 _1
TOTAL PARTICIPANTS _J_2 _A
Cost-Sharing Multiple-Employer Defined Benefit Plan
County Employees' Retirement System
Plan Description: The City is a participant in the County Employees Retirement System (CERS), a
cost sharing, multi-employer public employee retirement system. CERS provides retirement, disability,
and death benefits to plan members. Retirement benefits may be extended to beneficiaries of plan
members under certain circumstances. Cost-of-living adjustments are provided at the discretion of the
State legislature. Under the provisions of Kentucky Revised Statute 61.645, the Board of Trustees of
Kentucky Retirement Systems administers the CERS. Kentucky Retirement Systems issues a publicly
available financial report that includes financial statements and required supplementary information for
CERS. That report may be obtained by writing to Kentucky Retirement Systems, Perimeter Park West,
1260 Louisville Road, Frankfort, Kentucky 40601-6124 or by calling 1-502-564-4646.
-85-
(Continued)
CITY OF PADUCAH, KENTUCKY
NOTES TO FINANCIAL STATEMENTS
FOR THE YEAR ENDED JUNE 30, 2012
Note 4-Pension Plans-City of Paducah:
Cost-Sharing Multiple-Employer Defined Benefit Plan
County Employees' Retirement System
Funding Policy: Hazardous position employees are required to contribute 8% to the plan and
nonhazardous position employees are required to contribute 5% of their creditable compensation by
State statute. For employees hired on September I, 2008, or thereafter, an additional 1% must be
contributed to a health insurance account. The City is required by the same statute to contribute the
remaining amounts necessary to pay benefits when due. For the years ended June 30, 2012, 201 I, and
2010, the City contributed 35.76%, 33.25%, and 32.97%, respectively, of each hazardous employee's
creditable compensation and 18.96%, 16.93%, and 16.16%, respectively, of each nonhazardous
employee's creditable compensation. These actuarially determined rates are set by the Board of
Trustees of Kentucky Retirement Systems. The City's contributions to CERS for the years ending June
30, 2012, 201 I, and 2010, were $5,114,775, $4,885,288, and $4,538,848, respectively, equal to the
required contributions for each year.
Note 5 -Appropriations Deficit:
No departments that adopted budgets annually had excess expenditures over appropriations for the fiscal
year ended June 30, 2012.
Note 6 -Component Unit Long-Term Liabilities:
Long-term liabilities of the discretely presented component units consist of the following at June 30, 20 I 2:
Note Payable, Kentucky Infrastructure Authority (KIA) -Paducah Water Works
In connection with a merger with Reidland Water District, Paducah Water Works assumed a loan from the
KIA. Interest rates range from I .00% to 5.19%, with a .25% annual service fee. The annual requirements
to amortize the outstanding debt as of June 30, 20 I 2, are as follows:
Year Ending
June 30 Principal Interest
2013 $ 364,440 $ 68,800
2014 337,793 65,429
2015 341,179 62,043
2016 344,600 58,623
2017 348,054 55,168
2018-2022 1,793,314 222,796
2023-2027 1,885,024 131,086
2028-2031 1.577.195 35.693
TOTALS $6.991.599 $622!638
-86-
.25%
Service
Fee
$ 17,195
16,357
I 5,5 I I
14,656
13,792
55,699
32,771
8.923
$114!204
R&M
Reserve
$ I 8,750
18,750
18,750
18,750
18,750
75,000
$t68a5o
Total
$ 469,185
438,329
437,483
436,629
435,764
2,146,809
2,048,881
1.621.81 I
$8.034!821
(Continued)
CITY OF PADUCAH, KENTUCKY
NOTES TO FINANCIAL STATEMENTS
FOR THE YEAR ENDED JUNE 30,2012
Note 6 -Component Unit Long-Term Liabilities:
Notes Payable, Kentucky Association of Counties (KACO)-Paducah Transit Authority
On February 13, 2004, the Transit Authority of the City of Paducah entered into an agreement with the
KACO in connection with grant match projects. Interest rate on this agreement is 4.186%. As of June 30,
2012, the outstanding balance was $35,082.
The following schedule summarizes the remaining debt service requirements for the Transit Authority of
the City of Paducah notes payable:
Fiscal Year
2013
Note 7 -Commitments and Contingencies:
Grant Contingencies
Total
Debt
Principal Interest Service
$35.082 $854 $35.936
Amounts received from grantor agencies are subject to audit and adjustment by grantor agencies,
principally the federal government. Any disallowed claims, including amounts already collected, may
constitute a liability of the applicable funds. The amount, if any, of expenditures which may be disallowed
by the grantor cannot be determined at this time although the government expects such amounts, if any, to
be immaterial.
Construction Commitments
The City has various on-going contracts for construction, renovations, paving materials, equipment, and
labor. As of June 30, 2012, the significant construction commitments were as follows:
Olivet Church Road Improvement Project
Riverfront Development-Phase I
Riverfront-Other River Boat Launch Project
Greenway Trail Project
-87-
Cumulative
Costs Incurred
$1,678,028
1,189,343
284,163
235.658
Estimated
Total Costs
$1,680,000
3,236,680
291,075
1.240.000
$3.387.192 $6.447.755
(Continued)
CITY OF PADUCAH, KENTUCKY
NOTES TO FINANCIAL STATEMENTS
FOR THE YEAR ENDED JUNE 30,2012
Note 8 -Risk Management and Litigation:
The City is exposed to various risks of loss related to torts; theft of, damage to, and destruction of assets;
errors and omissions; injuries to employees; and natural disasters. The City obtains coverage from
commercial insurance companies to handle the risk of loss. There have been no decreases in insurance
coverage from the prior year. There have been no settlements in excess of insurance coverage during the
prior three years.
An analysis of claims activity is presented below:
Current Year
Beginning of Claims and Actual Balance at
Fiscal Year Changes in Claim Fiscal
Liability Estimates Pavments YearEnd
2009-2010 $ $ 46,051 $ 46,051 $
2010-2011 70,643 70,643
2011 -2012 119,319 117,856 1,463
During fiscal year 1999, the City established the Health Insurance Fund (an internal service fund) to
account for and finance employee medical costs relating to the City's employee self-insured medical
benefit plan that went into effect as of July 1, 1999. The health insurance provides coverage for up to
$150,000 for each covered individual. The City purchases commercial insurance (reinsurance) for claims
in excess of the coverage provided per individual or in excess of the maximum aggregate limit, which is
based on a formula that considers group census and anticipated claims. As of June 30, 2012, that number
was $2,656,261. Self-insurance costs are accrued based on claims reported within 90 days of the balance
sheet date as well as an estimated liability for claims incurred but not reported. The total accrued liability
for self-insurance costs was $254,926 at June 30, 2012.
The analysis of claims activity is presented below:
Current Year
Beginning of Claims and Actual Balance at
Fiscal Year Changes in Claim Fiscal
Liability Estimates Pavments YearEnd
2009-2010 $ 53,586 $2,682,055 $2,506,993 $228,648
2010-2011 228,648 2,118,069 2,118,437 228,280
2011 -2012 228,280 3,224,703 3,203,329 249,654
Several lawsuits are pending involving citizens' complaints and the City of Paducah. Various allegations
have been made seeking damages which the legal counsel of the City, along with its management, has
determined to be immaterial to the City's financial position.
(Continued)
-88-
Note 9 -Lease Agreements:
Operating Leases
CITY OF PADUCAH, KENTUCKY
NOTES TO FINANCIAL STATEMENTS
FOR THE YEAR ENDED JUNE 30,2012
The City is leasing land and building to the Luther F. Carson Four Rivers Center for the Performing Arts
(Center) for a primary term of 99 years. No rental revenue is being collected from this lease. The rental
for the primary term of the lease is the construction of the performing arts center. The building is deemed
the property of the City; however, for financial reporting, the building is reported with the Luther F.
Carson Four Rivers Center financial records. In December 2003, with the authorization of the City, the
Center secured financing of $6.5 million subject to a mortgage against the leasehold and real property on
which the performing arts center is located. The City also consented to an assignment of the lease as
security for the loan.
The City also leases certain other property to various lessees under non-cancelable agreements that have
various expiration dates through November 30, 2021. Rental revenue received from leased property
during 2012 totaled $438,671.
The following is an analysis of property leased under these leases at June 30, 2012:
Land $ 270,000
Buildings 873,250
Equipment 110.126
Total 1,253,376
Less: accumulated depreciation 846.375
NET BOOK VALUE $ 401!001
Depreciation expense for the year ended June 30, 2012, on leased property was $29,085.
The following is a schedule of future minimum rental income from operating leases at June 30, 2012:
2013
2014
2015
2016
2017
2018-2022
TOTAL MINIMUM LEASE RECEIPTS
Direct Financing Lease
Lease
Income
$ 437,943
437,943
257,943
77,943
60,123
265.543
$1.531.438
The City is leasing land and a building to Infiniti Media, Incorporated for use by Infiniti Plastic
Technologies, Incorporated for a primary term of 20 years. No rental revenue was required during the first
three years of the lease term which resulted in a loss of $450,353. For the government-wide statement, the
loss is amortized over the life of the lease. Rental payments commenced on September I, 2007, at a
(Continued)
-89-
Note 9 • Lease Agreements:
Direct Financing Lease
CITY OF PADUCAH, KENTUCKY
NOTES TO FINANCIAL STATEMENTS
FOR THE YEAR ENDED JUNE 30, 2012
monthly payment of $33,816 and end with the final payment due August 1, 2024. Infiniti Media may
purchase the property during the term of lease by paying off the related indebtedness. In addition, at the
end of the lease term, lnfiniti Media may purchase the property for $1. Infiniti Media has the option to
cancel this lease at any time after the sixth year of the lease term by providing written notice 18 months
prior to the date of termination. The lease payments received coincide with debt service payments the City
is required to make on bonds maturing annually through year ending June 30, 2024.
Future minimum lease payments to be received under the lease agreement for the fiscal year ending June
30 are as follows:
2013
2014
2015
2016
2017
20 18 through 2024
Net minimum lease payments
Less amount representing interest
PRESENT VALUE OF MINIMUM
LEASE PAYMENTS
-90-
Lease
Income
$ 405,796
405,796
405,796
405,796
405,796
2.840.568
4,869,548
( 1.44 1.481)
$ 3.428 067
CITY OF PADUCAH, KENTUCKY
REQUIRED SUPPLEMENTARY INFORMATION
COMPREHENSIVE ANNUAL FINANCIAL REPORT
YEAR ENDED JUNE 30, 2012
Actuarial
Valuation
Date
Actuarial
Value of
Assets
(a)
CITY OF PADUCAH, KENTUCKY
REQUIRED SUPPLEMENTARY INFORMATION
PENSION TRUST FUNDS SCHEDULES
Schedules of Funding Progress
Actuarial
Accrued
Liability (AAL)
(b)
Unfunded
AAL
(UAAL)
(b-a)
Funded
Ratio
(alb)
Annual
Covered
Payroll
(c)
Exhibit A-1
UAALasa
Percentage of
Covered Payroll
((b-a)/c)
Police and Firefighters' Pension Fund (PFPF) (Using Entry Age Normal Method)
7/1/2007 $ 14,470,016 $ 14,463,785 $ (6,231) 100.0 $100,986 $ (6.17)
7/1/2008 12,097,054 14,076,843 1,979,789 85.9 56,475 3,505.60
7/1/2009 8,647,519 13,476,007 4,828,488 64.2 55,475 8,641.74
7/1/2010 8,443,296 13,134,852 4,691,556 64.3 63,434 7,395.96
711/2011 8,715,408 12,375,144 3,659,736 70.4 62,915 5,816.95
711/2012 7,567,321 12,000,339 4,433,018 63.1 77,148 5,746.12
Appointive Employees' Pension Fund (AEPF) (Using Entry Age Actuarial Method)
7/1/2007 $ 317,575 $ 382,916 $ 65,341 82.9 n/a* n/a*
7/1/2008 271,701 317,849 46,148 85.5 n/a* n/a*
7/1/2009 226,016 306,287 80,271 73.8 n/a* n/a*
7/1/2010 178,245 294,784 116,539 60.5 n/a* n/a*
7/1/2011 137,018 161,229 24,211 85.0 n/a* n/a*
7/1/2012 106,983 154,679 47,696 69.2 n/a* n/a*
* There are no active participants.
Schedules of Employer Contributions
PFPF
Year Annual Percent Ending
Ended Required ARC Net Pension
.Iune 30 Contribution {ARC} Contributed Obligation {NPO}
2007 $ 46,948 446 $(5,552,551)
2008 12,887 345 (5,546, 740)
2009 183,661 123 (5,551,753)
2010 460,892 109 (5,511 ,936)
2011 455,139 99 (5,457,076)
2012 361,701 108 (5,428,344)
AEPF
Year Annual Percent Ending
Ended Required ARC Net Pension
.Iune 30 Contribution {ARC} Contributed Obligation {NPO}
2007 $ 13,883 180 $ (278,827)
2008 8,925 0 (250,893)
2009 6,278 0 (227,510)
2010 17,095 0 ( 194,904)
2011 3,760 0 (177,855)
2012 7,722 0 (158,008)
-91-
CITY OF PADUCAH, KENTUCKY
SUPPLEMENTARY INFORMATION
COMPREHENSIVE ANNUAL FINANCIAL REPORT
YEAR ENDED JUNE 30, 2012
CITY OF PADUCAH, KENTUCKY
GENERAL CAPITAL IMPROVEMENTS
DETAD... STATEMENT OF REVENUES, EXPENDITURES, AND
CHANGES IN FUND BALANCE-BUDGET AND ACTUAL
FOR THE YEAR ENDED JUNE 30,2012
Revenues:
Grants
Intergovernmental
Interest
Miscellaneous
Total revenues
Expenditures:
Principal requirement
Capital outlay
Total expenditures
Excess (deficiency) of revenues over
expenditures
Other Financing Sources (Uses):
Long-term debt issued
Operating transfers in
Operating transfers out
Total other financing sources (uses)
Net change in fund balance
Fund balance, July 1, 2011
FUND BALANCE, JUNE 30, 2012
See auditors report on pages 11-12.
-92-
Final
Budget
$ 212,315
7,415
383,870
603,600
2,105,015
2,105,015
( 1,501 ,415)
101,980
1,822,385
(514,720)
1,409,645
$ (91,770)
Actual
$ 212,323
7,418
383,880
603,621
2,104,993
2,104,993
(1 ,501 ,372)
101,983
1,822,397
(514,712)
1,409,668
(91,704)
1,579,642
$1,487,938
Exhibit B-1
Variance with
Final Budget
Positive
(Negative)
$ 8
3
10
21
22
22
43
3
12
8
23
$ 66
CITY OF PADUCAH, KENTUCKY
DEBT SERVICE FUND
DETAll.. STATEMENT OF REVENUES, EXPENDITURES, AND
CHANGES IN FUND BALANCE-BUDGET AND ACTUAL
FOR THE YEAR ENDED JUNE 30, 20I2
Final
Revenues: Budget Actual
Intergovernmental $ 577,820 $ 577,831
Expenditures:
Principal requirement I,434,249 1,434,246
Interest and fiscal requirement I,II4,9II 1 '114,852
Total expenditures 2,549,I60 2,549,098
Excess (deficiency) of revenues over
expenditures (I ,971 ,340) ( 1,97 I ,267)
Other Financing Sources (Uses):
Capital lease 405,800 405,796
Operating transfers in I,560,IOO 1,560,I03
Total other financing sources (uses) 1,965,900 1,965,899
Net change in fund balance $ (5,440) (5,368)
Fund balance, July I, 20 I 1 74,272
FUND BALANCE, JUNE 30, 20I2 $ 68,904
See auditors report on pages 1 I -12.
-93-
Exhibit B-2
Variance with
Final Budget
Positive
(Negative)
$ I I
3
59
62
73
(4)
3
(I)
$ 72
CITY OF PADUCAH, KENTUCKY
SUPPLEMENTARY INFORMATION
NONMAJOR GOVERNMENTAL FUNDS
COMPREHENSIVE ANNUAL FINANCIAL REPORT
YEAR ENDED JUNE 30, 2012
COMBINING FINANCIAL STATEMENTS
NONMAJOR GOVERNMENTAL FUNDS
Special Revenue Funds
Municipal Aid Program -to account for revenues and expenditures of Kentucky gas tax refunds.
Emergency Communication Service Fund -to account for revenues associated with 911 program.
Court Awards Fund -to account for revenues associated with judicial system confiscations.
Bond Fund -to account for revenues associated with bonds issued by the City.
Federal, State, and Local Grants -to account for the grant programs awarded to the City of
Paducah from agencies of the Federal Government and the Commonwealth of Kentucky.
PRA -Paducah Renaissance Alliance -to account for the revenues associated with the economic
promotion of downtown Paducah, Kentucky.
Exhibit B-3
CITY OF PADUCAH, KENTUCKY
COMB~GBALANCESHEET
NONMAJOR GOVERNMENTAL FUNDS
JUNE 30, 2012
Special Revenue Funds
Emergency Court Small
ASSETS Municipal Communication Awards Grant
Aid Program Service Fund Fund Fund
Cash and cash equivalents $1,363,071 $295,171 $173,241 $40,419
Investments
Receivables, net:
Accounts 56,441 161,558
Grants
Interest
TOTAL ASSETS $1,419,512 $456,729 $173,241 $40,419
LIABILITIES
AND
FUND BALANCES
Liabilities:
Voucher and accounts payable $ 262,831 $ 3,100 $ 93,142 $
Accrued payroll and payroll taxes 50,298
Due to other funds
Deferred revenues 40,419
Accrued compensated absences
Total liabilities 262,831 53,398 93,142 40,419
Fund Balances:
Restricted for:
Highways and streets 1 '156,681
Public safety 80,099
Capital improvements
Assigned for:
Public service
Public safety 403,331
Planning and development
Total fund balances 1 '156,681 403,331 80,099
TOTAL LIABILITIES AND
FUND BALANCES $1,419,512 $456,729 $173,241 $40,419
See auditors report on pages 11-12.
-94-
Special Revenue Funds
CDBG
Grant Bond PRA
Fund Fund Fund
$ $286,276 $
1,500
$1,500 $286,276 $
$1,500 $ $
1,500
286,276
286,276
$1,500 $286,276 $
Total Nonmajor
Governmental
Funds
$2,158,178
217,999
1,500
$2,377,677
$ 360,573
50,298
40,419
451,290
1 '156,681
80,099
286,276
403,331
1,926,387
$2,377,677
-95-
Exhibit B-4
CITY OF PADUCAH, KENTUCKY
COMBINING STATEMENT OF REVENUES, EXPENDITURES
AND CHANGES IN FUND BALANCES
NONMAJOR GOVERNMENTAL FUNDS
FOR THE YEAR ENDED JUNE 30, 2012
Special Revenue Funds
Emergency Court Small
Municipal Communication Awards Grant
Revenues: Aid Program Service Fund Fund Fund
Taxes $ $ 433,350 $ $
Charges for services 248,705
Intergovernmental 619,911
Grants 50,107 46,555
Interest 8,808 2,695 I ,811
MisceiJaneous 7,838 348,966 9,797
Total revenues 636,557 1,033,716 51,918 56,352
Expenditures:
Current operations:
Public safety 1,577,810 41,427
Public service 1,159,682
Planning and development 68,127
Principle requirement
Total expenditures 1,159,682 1,577,810 41,427 68,127
Excess (deficiency) of revenues
over expenditures (523, 125) (544,094) 10,491 (11 ,775)
Other Financing Sources (Uses):
Capital lease
Proceeds of refunding bond, net
Transfer to refunded bond escrow agent
Long-term debt issued
Transfers in 890,000 448,550 11,775
Transfers out (102,369)
Total other financing sources (uses) 787,631 448,550 11,775
Net change in fund balances 264,506 (95,544) 10,491
Fund balances, July I, 20 II 892, I75 498,875 69,608
FUND BALANCES, JUNE 30, 2012 $1,156,681 $ 403,331 $80,099 $
See auditors report on pages I1-12.
-96-
Special Revenue Funds
CDBG
Grant Bond PRA
Fund Fund Fund
$ $ $
560,355
5,018 675
11,971
560,355 5,018 12,646
560,355 223,303
560,355 223,303
5,018 (210,657)
3,910,000
(3,91 0,000)
210,500
(272,886) (40,666)
(272,886) 169,834
(267,868) (40,823)
554,144 40,823
$ $ 286,276 $
Total Nonmajor
Governmental
$
Funds
433,350
248,705
619,911
657,017
19,007
378,572
2,356,562
1,619,237
1,159,682
851,785
3,630,704
(1 ,274, 142)
3,910,000
(3,91 0,000)
1,560,825
(415,921)
I, 144,904
(129,238)
2,055,625
$ 1,926,387
-97-
CITY OF PADUCAH, KENTUCKY
MUNICIPAL AID PROGRAM FUND
DETAIL SCHEDULE OF REVENUES, EXPENDITURES, AND
CHANGES IN FUND BALANCE-BUDGET AND ACTUAL
FOR THE YEAR ENDED JUNE 30, 2012
Revenues:
Intergovernmental
Interest
Total revenues
Expenditures:
Public service
Excess (deficiency) of revenues over
expenditures
Other Financing Sources (Uses):
Operating transfers in
Operating transfers out
Total other financing sources
Net change in fund balance
Fund balance, July I, 2011
FUND BALANCE, JUNE 30, 2012
See auditors report on pages II-I2.
-98-
Final
Budget
$ 627,745
8,805
636,550
I, 159,685
(523,135)
890,000
(102,370)
787,630
$ 264,495
Actual
$ 627,749
8,808
636,557
1,159,682
(523,125)
890,000
(102,369)
787,631
264,506
892,175
$1 '156,681
Exhibit B-5
Variance with
Final Budget
Positive
(Negative)
$ 4
3
7
3
IO
$ II
CITY OF PADUCAH, KENTUCKY
EMERGENCY COMMUNICATION SERVICE FUND
DETAll... SCHEDULE OF REVENUES, EXPENDITURES, AND
CHANGES IN FUND BALANCE-BUDGET AND ACTUAL
FOR THE YEAR ENDED JUNE 30,2012
Final
Revenues: Budget Actual
Taxes $ 433,350 $ 433,350
Telephone surcharges 248,705 248,705
Interest 2,695 2,695
Miscellaneous 348,965 348,966
Total revenues 1,033,715 1,033,716
Expenditures:
Public safety 1,578,030 1,577,810
Excess (deficiency) of revenues over
expenditures (544,315) (544,094)
Other Financing Sources (Uses):
Operating transfers in 448,550 448,550
Net change in fund balance $ (95,765) (95,544)
Fund balance, July 1, 2011 498,875
FUND BALANCE, JUNE 30, 2012 $ 403,331
See auditors report on pages 11-12.
-99-
Exhibit B-6
Variance with
Final Budget
Positive
(Negative)
$
220
221
$ 221
CITY OF PADUCAH, KENTUCKY
COURT AWARDS FUND
DETAIL SCHEDULE OF REVENUES, EXPENDITURES, AND
CHANGES IN FUND BALANCE-BUDGET AND ACTUAL
FOR THE YEAR ENDED JUNE 30,2012
Final
Revenues: Budget Actual
Court awarded forfeitures $ $
Grants 50,075 50,107
Interest 1,810 I ,811
Total revenues 51,885 51,918
Expenditures:
Public safety 41,430 41,427
Excess (deficiency) of revenues over
expenditures $10,455 10,491
Fund balance, July 1, 2011 69,608
FUND BALANCE, JUNE 30, 2012 $80,099
See auditors report on pages 11-12.
-100-
Exhibit B-7
Variance with
Final Budget
Positive
(Negative)
$
3
$ 4
CITY OF PADUCAH, KENTUCKY
SMALL GRANT FUND
DETAil.. SCHEDULE OF REVENUES, EXPENDITURES, AND
CHANGES IN FUND BALANCE-BUDGET AND ACTUAL
FOR THE YEAR ENDED JUNE 30, 20I2
Revenues:
Grants
Interest
Other
Total revenues
Expenditures:
Planning and development
Excess (deficiency) of revenues over
expenditures
Other Financing Sources (Uses):
Operating transfers in
Operating transfers out
Total other financing sources
Net change in fund balance
Fund balance, July I, 20I I
FUND BALANCE, JUNE 30,2012
See auditors report on pages 11-12.
-101-
Final
Budget Actual
$46,555 $46,555
9,795 9,797
56,350 56,352
68,I30 68,I27
(1 I,780) (1 I,775)
I I,775 I I ,775
I I ,775 I I,775
$ (5)
$
Exhibit B-8
Variance with
Final Budget
Positive
(Negative)
$
2
2
3
5
$ 5
CITY OF PADUCAH, KENTUCKY
CDBG GRANT FUND
DETAIL SCHEDULE OF REVENUES, EXPENDITURES, AND
CHANGES IN FUND BALANCE-BUDGET AND ACTUAL
FOR THE YEAR ENDED JUNE 30,2012
Revenues:
Grants
Misce11aneous
Total revenues
Expenditures:
Planning and development
Excess (deficiency) of revenues over
expenditures
Net change in fund balance
Fund balance, July 1, 2011
FUND BALANCE, JUNE 30, 2012
See auditors report on pages 11-12.
-102-
Final
Budget Actual
$560,355 $560,355
560,355 560,355
560,360 560,355
(5)
$ (5)
$
Exhibit B-9
Variance with
Final Budget
Positive
(Negative)
$
5
5
$ 5
Exhibit B-10
CITY OF PADUCAH, KENTUCKY
SPECIAL REVENUE BOND FUND
DETAIL SCHEDULE OF REVENUES, EXPENDITURES, AND
CHANGES IN FUND BALANCE-BUDGET AND ACTUAL
FOR THE YEAR ENDED JUNE 30,2012
Variance with
Final Budget
Final Actual Positive
Budget Amounts (Negative)
Revenues:
Interest $ 5,015 $ 5,018 $ 3
Expenditures:
General government:
Planning and development:
Bond issuance costs
Excess (deficiency) of revenues over
expenditures 5,015 5,018 3
Other Financing Sources (Uses):
Proceeds of refunding bond, net 3,910,000 3,910,000
Transfer to refunded bond escrow agent (3,91 0,000) (3,910,000)
Operating transfers out (272,890) (272,886) 4
Total other financing sources (uses) (272,890) (272,886) 4
Net change in fund balance $ (267,875) (267,868) $ 7
Fund balance, July I, 2011 554,144
FUND BALANCE, JUNE 30,2012 $ 286,276
See auditors report on pages 11-12.
-103-
CITY OF PADUCAH, KENTUCKY
PRAFUND
DETAIL SCHEDULE OF REVENUES, EXPENDITURES, AND
CHANGES IN FUND BALANCE-BUDGET AND ACTUAL
FOR THE YEAR ENDED JUNE 30, 2012
Revenues:
Interest
Other
Total revenues
Expenditures:
Planning and development
Excess (deficiency) of revenues over
expenditures
Other Financing Sources (Uses):
Operating transfers in
Operating transfers out
Total other financing sources (uses)
Net change in fund balance
Fund balance, July 1, 2011
FUND BALANCE, JUNE 30,2012
See auditors report on pages 11-12.
-104-
Final
Budget
$ 675
12,030
12,705
223,470
(210,765)
210,500
(40,666)
169,834
$ (40,931)
Actual
$ 675
11,971
12,646
223,303
(210,657)
210,500
(40,666)
169,834
(40,823)
40,823
$
Exhibit B-12
Variance with
Final Budget
Positive
(Negative)
$
(59)
(59)
167
108
$ 108
CITY OF PADUCAH, KENTUCKY
SUPPLEMENTARY INFORMATION
NONMAJOR PROPRIETARY FUNDS
COMPREHENSIVE ANNUAL FINANCIAL REPORT
YEAR ENDED JUNE 30, 2012
COMBINING FINANCIAL STATEMENTS
NONMAJOR ENTERPRISE FUNDS
Section Eight Housing Fund -to account for the housing choice voucher program grant governed
by the United States Department of Housing and Urban Development.
Civic Center Fund-to account for the operation of the Civic Center.
TISA Fund -to account for revenues and expenses associated with the operation of the Paducah-
McCracken County telecommunications and information systems.
Exhibit C-1
CITY OF PADUCAH, KENTUCKY
COMBINING STATEMENT OF NET ASSETS
NONMAJOR ENTERPRISE FUNDS
JUNE 30, 2012
ASSETS Section Civic Total Nonmajor
Eight Center TISA Enterprise
Current Assets: Housing Fund Fund Funds
Cash and cash equivalents $ 897,126 $ $276,963 $1,174,089
Accounts receivable 1,035 1,035
Prepaid expense
Total current assets 897,126 277,998 1,175,124
Noncurrent Assets:
Net depreciable capital assets 12,652 169,618 34,097 216,367
Total assets 909,778 169,618 312,095 I ,391,491
LIABILITIES
Current Liabilities:
Voucher and accounts payable 102,376 5,071 2,501 109,948
Accrued compensated absences 1,601 1,601
Due to other funds 45,918 45,918
Total current liabilities 149,895 5,071 2,501 157,467
Noncurrent Liabilities:
Accrued compensated absences 14,414 14,414
Total liabilities 164,309 5,071 2,501 171,881
NET ASSETS
Invested in capital assets 12,652 169,618 34,097 216,367
Restricted for:
Housing and development projects 732,817 732,817
Unrestricted (5,071) 275,497 270,426
TOTAL NET ASSETS $ 745,469 $164,547 $309,594 $1,219,610
See auditors report on pages 11-12.
-105-
Exhibit C-2
CITY OF PADUCAH, KENTUCKY
COMBINING STATEMENT OF REVENUES, EXPENSES
AND CHANGES IN FUND NET ASSETS
NONMAJOR ENTERPRISE FUNDS
FOR THE YEAR ENDED JUNE 30, 2012
Section Civic Total Nonmajor
Eight Center TISA Enterprise
Operating Revenues: Housing Fund Fund Funds
Charges for services $1,635,764 $ 34,038 $ 99,603 $1,769,405
Miscellaneous 12,217 12,217
Total operating revenues 1,647,981 34,038 99,603 1,781,622
Operating Expenses:
Cost of sales and service 1,915,365 60,956 140,601 2,116,922
Depreciation and amortization 5,639 10,209 33,107 48,955
Total operating expenses 1,921,004 71 '165 173,708 2,165,877
Operating income (loss) (273,023) (37,127) (74,105) (384,255)
Non-Operating Revenues (Expenses):
Interest and investment income 316 316
Income (loss) before contributions and
operating transfers (272,707) (37,127) (74,105) (383,939)
Contributions and Operating Transfers:
Capital contributions
Transfers in 27,104 27,104
Transfers out (50,000) (50,000)
Total contributions and operating transfers 27,104 (50,000) (22,896)
Change in net assets (272,707) (10,023) (124, 105) (406,835)
Net assets, July 1, 2011 1,018,176 174,570 433,699 1,626,445
NET ASSETS, JUNE 30, 2012 $ 745,469 $164,547 $309,594 $1,219,610
See auditors report on pages 11-12.
-106-
CITY OF PADUCAH, KENTUCKY
COMBINING STATEMENT OF CASH FLOWS
NONMAJOR ENTERPRISE FUNDS
FOR THE YEAR ENDED JUNE 30, 2012
Section Civic
Eight Center
Cash Flows from Operating Activities: Housing Fund
Cash received from customers $ I,635,764 $ 34,038
Payments to employees (133,357)
Payments to internal service funds (2,350)
Other receipts I2,2I7
Other payments (I ,784,754) (58,899)
Net cash provided (used) by operating activities (270,I30) (27,211)
Cash Flows from Noncapital
Financing Activities:
Transfers (to) from other funds 27,104
Cash Flows from Investing Activities:
Interest on cash and investments 3I6
Net increase (decrease) in cash and cash
equivalents (269,8I4) (107)
Cash and cash equivalents, July I, 2011 I,166,940 107
CASH AND CASH EQUIVALENTS,
JUNE 30, 2012 $ 897,126 $
Reconciliation of Operating Income (Loss) to
Net Cash Provided by Operating Activities:
Operating income (loss) $ (273,023) $ (37,127)
Adjustments to reconcile operating income (loss)
to net cash provided by operating activities:
Depreciation and amortization 5,639 10,209
Change in assets and Jiabilities:
Receivables
Prepaid expense
Accrued expenses 1,360
Accounts payable (4,106) (293)
NET CASH PROVIDED (USED) BY
OPERATING ACTIVITIES $ (270,130) $ (27,211)
See auditors report on pages 11-12.
-I07-
Exhibit C-3
Total Nonmajor
TISA Enterprise
Fund Funds
$ 108,197 $ 1,777,999
(133,357)
(1,411) (3,761)
12,217
(128,282) (I ,97I ,935)
(21,496) (3I8,837)
(50,000) (22,896)
3I6
(71,496) (34I,417)
348,459 I,5I5,506
$ 276,963 $ 1,174,089
$ (74,I05) $ (384,255)
33,I07 48,955
8,594 8,594
9,590 9,590
1,360
1,318 (3,081)
$ (21,496) $ (3I8,837)
CITY OF PADUCAH, KENTUCKY
SUPPLEMENTARY INFORMATION
INTERNAL SERVICE FUNDS
COMPREHENSIVE ANNUAL FINANCIAL REPORT
YEAR ENDED JUNE 30, 2012
COMBINING FINANCIAL STATEMENTS
INTERNAL SERVICE FUNDS
Fleet Maintenance -to account for costs of operating a maintenance facility for automotive
equipment used by other City departments.
Fleet Lease Trust -to account for the financing of vehicle acqutstttons provided by one
department or agency to other departments or agencies of the government and to other
governmental units, on a cost reimbursement basis.
Insurance Fund -to account for the costs of obtaining insurance for other City departments.
Health Insurance Fund -to account for the costs associated with the City's health insurance
activities. The intent of the City of Paducah is that the cost of providing insurance coverage on a
continuing basis be financed primarily through user charges.
Exhibit D-1
CITY OF PADUCAH, KENTUCKY
COMBINING STATEMENT OF NET ASSETS
INTERNAL SERVICE FUNDS
JUNE 30, 2012
ASSETS
Health
Fleet Fleet Lease Insurance Insurance Combined
Current Assets: Maintenance Trust Fund Fund Total
Cash and cash equivalents $ 2,910 $2,694,633 $279,939 $724,058 $3,701,540
Investments 550,000 550,000
Receivables, net 4,943 2,376 78,774 86,093
Due from other funds 510,810 510,810
Prepaid expense
Inventories 76,889 76,889
Total current assets 79,799 3,760,386 282,315 802,832 4,925,332
Noncurrent Assets:
Net depreciable capital assets 22,694 3,071,112 3,093,806
Total assets 102,493 6,831,498 282,315 802,832 8,019,138
LIABILITIES
Current Liabilities:
Voucher and accounts payable 3,929 4,537 254,926 263,392
Accrued payroll and payroll taxes 16,005 16,005
Accrued compensated absences
Due to other funds
Total current liabilities 19,934 4,537 254,926 279,397
Noncurrent Liabilities:
Accrued compensated absences 53,040 53,040
Total liabilities 72,974 4,537 254,926 332,437
NET ASSETS
Invested in capital assets, net
of related debt 22,694 3,071,112 3,093,806
Unrestricted 6,825 3,760,386 277,778 547,906 4,592,895
TOTAL NET ASSETS $ 29,519 $6,831,498 $277,778 $547,906 $7,686,701
See auditors report on pages 11-12.
-108-
Exhibit D-2
CITY OF PADUCAH, KENTUCKY
COMBINING STATEMENT OF REVENUES, EXPENSES,
AND CHANGES IN FUND NET ASSETS
INTERNAL SERVICE FUNDS
FOR THE YEAR ENDED JUNE 30, 2012
Health
Fleet Fleet Lease Insurance Insurance Combined
Operating Revenues: Maintenance Trust Fund Fund Total
Charges for services-internal $375,582 $ 812,993 $909,892 $3,995,086 $6,093,553
Charges for services -external 272,105 272,105
Total operating revenues 375,582 812,993 909,892 4,267,191 6,365,658
Operating Expenses:
Vehicle maintenance 511,172 511,172
Administrative 26,229 362,827 389,056
Insurance 965,518 3,785,353 4,750,871
Leave expense 7,160 7,160
Depreciation 9,903 568,418 578,321
Total operating expenses 528,235 594,647 965,518 4,148,180 6,236,580
Operating income (loss) (152,653) 218,346 (55,626) 119,011 129,078
Nonoperating Revenues and
(Expenses):
Interest and investment income 26 40,654 40,680
Gain (loss) on disposal of property
and equipment 2,299 34,418 36,717
Total nonoperating revenues
(expenses) 2,325 75,072 77,397
Income (loss) before operating
transfers (150,328) 293,418 (55,626) 119,011 206,475
Contributions and Operating
Transfers:
Transfers in 146,623 49,839 196,462
Transfers out (5,149) {5, 149)
Change in net assets (3,705) 288,269 (5,787) 119,011 397,788
Net assets, July I, 2011 33,224 6,543,229 283,565 428,895 7,288,913
NET ASSETS, JUNE 30,2012 $ 29,519 $6,831,498 $277,778 $ 547,906 $7,686,701
See auditors report on pages 11-12.
-109-
Exhibit D-3
CITY OF PADUCAH, KENTUCKY
COMBINING STATEMENT OF CASH FLOWS
INTERNAL SERVICE FUNDS
FOR THE YEAR ENDED JUNE 30, 2012
Health
Fleet Fleet Lease Insurance Insurance Combined
Cash Flows from Operating Activities: Maintenance Trust Fund Fund Total
Receipts from other funds for services $ 375,582 $ 822,449 $ 907,629 $4,188,685 $ 6,294,345
Payments to suppliers (245,090) (245,090)
Payments to employees (269,305) (269,305)
Claims paid (3,767,220) (3,767,220)
Other receipts
Other payments (3.525) (133,909) (961,387) (912,827) (2,011 ,648)
Net cash provided (used) by operating activities (142,338) 688,540 (53,758) (491 ,362) 1,082
Cash Flows from Noncapital Financing
Activities:
Transfers to other funds {5,149) (5.149)
Transfers from other funds 146,623 49,839 196,462
Net cash provided (used) by
noncapita1 financing activities 146.623 (5,149) 49,839 191,313
Cash Flows from Capital and Related
Financing Activities:
Purchase of capital assets (4,000) (I ,029,935) ( 1 ,033,935)
Proceeds from sale of capital assets 2,299 55,513 57,812
Net cash used by capital and related financing (1,701) (974,422) (976,123)
Cash Flows from Investing Activities:
Proceeds from sales and maturities
of investments 1,500,000 1,500,000
Interest and dividends 26 40,654 40,680
Purchase of investments (550,000) (550,000)
Net cash provided (used) by investing activities 26 990,654 990,680
Net increase (decrease) in cash
and cash equivalents 2.610 699,623 (3.919) (491.362) 206,952
Cash and cash equivalents. July 1, 2011 300 1,995,010 283,858 1.215,420 3.494,588
CASH AND CASH EQUIVALENTS,
JUNE 30, 2012 $ 2,910 $ 2,694,633 $ 279,939 $ 724,058 $ 3,701,540
Reconciliation of Operating Income (Loss) to
Net Cash Provided (Used) by Operating
Activities:
Operating income (loss) $ (152.653) $ 218,346 $ (55,626) $ 119,011 $ 129.078
Adjustments to reconcile operating
income (loss) to net cash provided
(used) by operating activities:
Depreciation and amortization 9,903 568,418 578.321
Change in assets and liabilities:
Receivables 9,456 (2,263) (78,506) (7 1.313)
Prepaid expense 403,130 15,000 418.130
Inventories
Due to other funds (3,525) (510,810) (550,000) (I ,064,335)
Accrued expenses 8,657 8,657
Accounts payable (4,720) 4,131 3,133 2.544
NET CASH PROVIDED (USED) BY
OPERATING ACfiVITIES $ (142,338) $ 688,540 $ (53,758) $ (491,362) $ 1,082
See auditors report on pages I 1-12.
-110-
CITY OF PADUCAH, KENTUCKY
SUPPLEMENTARY INFORMATION
FIDUCIARY FUNDS
COMPREHENSIVE ANNUAL FINANCIAL REPORT
YEAR ENDED JUNE 30, 2012
COMBINING FINANCIAL STATEMENTS
FIDUCIARY FUNDS
Pension Trust Funds
Police and Firefighters' Retirement Fund and Appointive Employees' Pension Fund-to account
for the accumulation of resources to be used for retirement payments at appropriate amounts and
times in the future. Resources are contributed by employees and by the City at amounts
determined by Kentucky Statutes and/or City Commission decisions.
CITY OF PADUCAH, KENTUCKY
COMBINING STATEMENT OF FIDUCIARY NET ASSETS
FIDUCIARY FUNDS-PENSION TRUST FUNDS
JUNE 30,2012
ASSETS
Cash and cash equivalents
Receivables:
Interest
Investments at fair value
Money market funds
Certificates of deposit
Common stock
Corporate bonds
U.S. agencies bonds
Mutual funds
Total assets
LIABILITIES
Voucher and accounts payable
NET ASSETS
Held in trust for pension benefits and
other purposes
See auditors report on pages 11-12.
Police and Appointive
Firefighters' Employees'
Retirement Fund Pension Fund
$ 4,436 $ 56,560
27,241 449
200,362
50,000
2,552,720
1,527,228
1,472,496
1,782,894
7,567,377 107,009
56 26
$7,567,321 $106,983
-111-
Exhibit E-1
Total
$ 60,996
27,690
200,362
50,000
2,552,720
1,527,228
1,472,496
1,782,894
7,674,386
82
$7,674,304
CITY OF PADUCAH, KENTUCKY
COMBINING STATEMENT OF CHANGES IN NET ASSETS
FIDUCIARY FUNDS-PENSION TRUST FUNDS
FOR THE YEAR ENDED JUNE 30,2012
Additions:
Contributions:
Employer
Plan members
Total contributions
Investment earnings:
Net increase in fair value of investments
Interest and dividends
Net investment earnings
Total additions
Deductions:
Benefits
Administrative expenses
Total deductions
Change in net assets
Net assets, July 1, 2011
NET ASSETS, JUNE 30, 2012
See auditors report on pages 11-12.
Police and
Firefighters'
Retirement Fund
$ 391,744
7,548
399,292
(122,860)
246,201
123,341
522,633
1,621,008
49,712
1,670,720
(l' 148,087)
8,715,408
$7,567,321
-112-
Appointive
Employees'
Pension Fund
$
1,716
1,716
1,716
24,610
7,141
31,751
(30,035)
137,018
$106,983
Exhibit E-2
Totals
$ 391,744
7,548
399,292
(122,860)
247,917
125,057
524,349
1,645,618
56,853
1,702,471
(1,178,122)
8,852,426
$7,674,304
COMBINING FINANCIAL STATEMENTS
FIDUCIARY FUNDS
Private-purpose Trust Funds
Other Trusts and Maintenance and Rehab Trust -to account for assets held by the City in the
capacity of trustee for specified purposes.
ASSETS
Investments at fair value
Mutual funds
Total assets
LIABILITIES
Due to other funds
NET ASSETS
CITY OF PADUCAH, KENTUCKY
COMBINING STATEMENT OF NET ASSETS
FIDUCIARY FUNDS -PRIVATE-PURPOSE TRUST FUNDS
JUNE 30, 2012
Other
Trusts
$1,106,065
1,106,065
Maintenance
and Rehab
Trust
$
Held in trust for other purposes $1,106,065 $
See auditors report on pages 11-12.
-113-
Exhibit E-3
Total
$1,106,065
1,106,065
$1,106,065
CITY OF PADUCAH, KENTUCKY
COMBINING STATEMENT OF CHANGES IN NET ASSETS
FIDUCIARY FUNDS -PRIVATE-PURPOSE TRUST FUNDS
FOR THE YEAR ENDED JUNE 30,2012
Maintenance
Other and Rehab
Additions: Trusts Trust
Contributions:
Intergovernmental revenues $ 3,135 $8,000
Private donations 3,458
Total contributions 6,593 8,000
Investment earnings:
Net increase in fair value of investments (61 ,241)
Loss on sale of investments 36,604
Interest and dividends 32,000
Net investment earnings 7,363
Total additions 13,956 8,000
Deductions:
Capital outlay 52,434 4,004
Administrative expenses 13,775 4, Ill
Total deductions 66,209 8,115
Change in net assets (52,253) ( 115)
Net assets, July 1, 2011 I, 158,318 115
NET ASSETS, JUNE 30, 2012 $1,106,065 $
See auditors report on pages 11-12.
-1 14-
Exhibit E-4
Totals
$ 11' 135
3,458
14,593
(61 ,241)
36,604
32,000
7,363
21,956
56,438
17,886
74,324
(52,368)
1,158,433
$1,106,065
COMBINING FINANCIAL STATEMENTS
FIDUCIARY FUNDS
Agency Fund
Payroll Agency Fund-to account for disbursements relative to the City payroll. The various
City departments transfer amounts to this fund to cover routine payroll and the related benefits
and taxes. All payroll disbursements are made from this fund.
Payroll Fund:
Assets:
Cash and cash equivalents
Liabilities:
Payroll taxes and withholdings
payable
See auditors report on pages 11-12.
CITY OF PADUCAH, KENTUCKY
AGENCY FUND
STATEMENT OF CHANGES
IN ASSETS AND LIABll.JTIES
FOR THE YEAR ENDED JUNE 30,2012
Balance
July 1, 2011
$133,077
$133,077
-115-
Additions
$14,714,099
$14,714,099
Deductions
$14,162,414
$14,162,414
Exhibit E-5
Balance
June 30, 2012
$684,762
$684,762
CITY OF PADUCAH, KENTUCKY
STATISTICAL SECTION
COMPREHENSIVE ANNUAL FINANCIAL REPORT
YEAR ENDED JUNE 30, 2012
STATISTICAL SECTION
This part of the City of Paducah's comprehensive annual financial report presents
detailed information as a context for undemanding what the information in the
financial statements, note disclosures, and required supplementary information say
about the City's overall financial health.
Contents
Financial Trends
These schedules contain trend information to help the reader understand how the
City's financial performance and well-being changed over time.
Revenue Capacity
These schedules contain information to help the reader assess the factors
affecting the City's ability to generate its property and employee taxes.
Debt Capacity
These schedules present information to help the reader assess the affordability of
the City's current levels of outstanding debt and the City's ability to issue
additional debt in the future.
Economic and Demographic Information
These schedules offer economic and demographic indicators to help the reader
understand the environment within which the City's financial activities take
place.
Operating Information
These schedules contain service and infrastructure data to help the reader
understand how the information in the City's financial report relates to the
services the City provides and the activities it performs.
Sources: Unless otherwise noted, the information in these schedules is derived from
the comprehensive annual financial reports for the relevant year. The City
implemented the new reporting model in the fiscal year ended June 30, 2003.
Schedules presenting government-wide information include information beginning in
that year.
Page
116-121
122-127
128-131
132-134
135-136
.!..
"!'
TABLE I
CITY OF PADUCAH, KENTUCKY
NET ASSETS BY COMPONENT
Last Ten Fiscal Years
(accrual basis of accowrtinx)
Fiscal Year
2012 2011 2010 (2) 2009 2008 2007
Governmental Activities:
Invested in capital assets, net of related debt $31,957,381 $32,905,977 $31,136,514 $31,215,252 $31,766,783 $32,557,572
Restricted for:
Program purposes 897,942 1,264,986 1,100,696 2,183,559 1,782,251 1,904,321
Capital projects 4,105,639 5,987,399 5,077,026 4,363,913 5,028.420 4,618,923
Unrestricted 5,913,997 4,229,501 8,165,101 8,621,077 9,432,763 9,057,641
TOTAL GOVERNMENTAL ACTIVITIES
NET ASSETS $42,874,959 $44,387,863 $45,479,337 $46,383,801 $48,010,217 $48,138,457
Business· Type Activities:
Invested in capital assets, net of related debt $ 1.308,574 $ 1,334,230 $ 1,652,961 $ 1,721,419 $ 1,863,975 $ 1,491.523
Restricted for:
Program purposes 732,817 999,885 620,800 369,368 579,460
Unrestricted 3,246,320 3,004,783 1,816,705 1,036,093 (19,965) (147,286)
TOTAL BUSINESS-TYPE
ACTIVITIES NET ASSETS $ 5,287,711 $ 5,338,898 $ 4,090,466 $ 3,126,880 $ 2,423.470 $ 1,344,237
Primary Government:
Invested in capital assets, net of related debt $33,265,955 $34,240,207 $32,789,475 $32,936,671 $33,630.758 $34,049,095
Restricted for:
Program purposes 1,630,759 2,264.871 1,721,496 2,552,927 2,361,711 1,904,321
Capital projects 4.105,639 5,987.399 5,077,026 4,363,913 5,028,420 4,618,923
Unrestricted 9,160,317 7,234,284 9,981,806 9,657,170 9.412,798 8,910,355
TOTAL PRIMARY GOVERNMENT
NET ASSETS $48,162,670 $49,726,761 $49,569,803 $49,510,681 $50,433,687 $49.482,694
(I) Significant change in governmental and business-type net assets due to reclassification for prior year omitted receivables, capital assets, and post-closure
landfill expenses.
(2) Significant change in governmental net assets due to restatement of prior year grant receivables.
2006 2005 (1) 2004 2003
$30,664,671 $29,492,197 $27,826,1 17 $27,955,839
1,018,231 727,699 714,538 713,766
2,689,804 940,323 4,031,802 3,583,589
7,718.198 7,419,037 (406,042) 1,571,120
$42,090,904 $38,579,256 $32,166,415 $33,824,314
$ 1,277,720 $ 1,463,118 $ 1,463,668 $ 1,425,753
132,090 (27,648) 1,979,494 1,565,100
$ 1,409,810 $ 1,435,470 $ 3,443,162 $ 2,990,853
$31,942,391 $30,955,315 $29,289,785 $29,381,592
1,018,231 727,699 714,538 713,766
2,689,804 940,323 4,031.802 3.583,589
7,850,288 7,391,389 1,573.452 3.136,220
$43,500,714 $40,014,726 $35,609,577 $36,815,167
Pages 1 of3
TABLE2
CITY OF PADUCAH, KENTUCKY
CHANGES IN NET ASSETS
Last Ten Fiscal Years
(accrual basi ... of accountin~:)
Fiscal Year
Expenses: 2012 2011 2010 (3) 2009 2008 (2) 2007 2006 2005 (1) 2004 2003
Governmental activities:
General government $ 12.937.997 $ 9,786,052 $ 9,763.178 $ 12.148,118 $ 10,709,641 $ 9.462,543 $ 9,057,295 $ 8.431,994 $ 7,969,027 $ 7,396,882
Public safety 17.045,731 16,993.228 16,239.042 15.734,557 15,938.831 15,182.704 14.592.756 14.620,938 13,243,912 12.964,120
Public service 6.163,602 7.328,806 7,669.729 12.849,566 9,543.714 8,299,658 8,486.662 6,249,860 8,618,901 7,376.791
Parks and recreation 2.654,098 2.748.333 2.653.474 1.492.306 1.286.955 1.197,072 1.044.361 1.045.024 1,026,293 975,362
Planning and development 1.192,952 1.212.103 970.022 708.827 282,042 1.891.725 2.404.636 2,521.412 5.330.393 3,108.192
Interest on long-term debt 1.059,537 1,363,580 1.099,450 1.029.888 1.066,067 1.134,898 974.101 775.122 496,049 428.578
Total governmental activities expense 41,053,917 39.432,102 38,394,895 43,963,262 38,827,250 37,168,600 36,559,811 33,644,350 36,684,575 32,249,925
Bu ... iness-type ac:tivirie.<;:
Solid Waste 3,900,264 3.832.130 3,797,097 4.037.845 4,086.747 4.079,684 3,893.013 3,683.954 3.419,464 3,359,731
Section Eight Housing 1.921.004 1,956,728 2.061,370 2.154,360 1.949,899
Civic Center 71.069 76.546 69,537 75.692 84,908 54.562 45.894 39.008 33,181 46,509
TISA 173.708 183.546 206.798 162.849 156,388 267.192 269.781 170.264 184,166 123,719
.!...
7"' Total business-type activities expense 6,066,045 6,048,950 6,134,802 6.430.746 6,277.942 4,401,438 4,208,688 3,893,226 3,636,811 3,529,959
TOTAL PRIMARY GOVERNMENT
EXPENSES $ 47.119,962 $ 45.481,052 $ 44,529,697 $ 50,394,008 $ 45,105,192 $ 41,570,038 $ 40,768,499 $ 37,537,576 $ 40,321.386 $ 35,779,884
Program Revenues:
Gm•emmental activirie.f:
Charges for services:
General government $ 1.488.845 $ 1,051,509 $ 993.371 $ 1.303.667 $ 1.415.943 $ 1.730,046 $ 1.618.903 $ 1.485,005 $ 1,601.414 $ 1.445,383
Public safety 509,297 790,650 484.754 602,262 268.839 1.024.610 767.086 794,814 1,134,386 94,386
Public service 1.032,953 1,205,666 1.197,194 1.220,999 1,111,188 1,150,507 942.355 895,155 986,618 683,119
Parks and recreation 97.896 129.790 152,890 180.420 124,606 122,929 103,932 117,317 132,388 131,355
Planning and development 1.600 30,627 10,810 20,602 13.501 12,893 15,867
Operating grants and contributions 2.215,247 2.086,625 1.813.019 2.119,845 1,340,261 2.797.216 2.988,612 2.452,694 3,290.134 4.176.548
Capital grants and contributions 533,169 1.767,093 1,390,848 4,889,520 1,297.900 3,681.490 3.302,568 1.100,064 3,221,637 2,213.757
Total governmental activities program
revenues 5,877,407 7,031.333 6,032.076 10,318,313 5.589,364 10,517,608 9,744,058 6,858,550 10,379,470 8,760,415
Pages2of3
TABLE2
CITY OF PADUCAH, KENTUCKY
CHANGES IN NET ASSETS
Last Ten Fiscal Years
(accrual basi.o; of accmmting)
Fiscal Year
Program Revenues: 2012 2011 2010 (3) 2009 2008 (2) 2007 2006 2005 (1) 2004 2003
Bu.'iine.'is-l)pe actb•ities:
Solid Waste $ 4.437.341 $ 4.476.139 $ 4.436.540 $ 4.547.959 $ 4,165.094 $ 3,928.140 $ 3.696.609 $ 3.583.417 $ 3.790.132 $ 3,298,964
Section Eight Housing
Civic Center 34.038 33.766 32.455 38,577 32.932 31.372 26.378 32,828 36.455 20,825
TIS A 99.603 138,797 148.158 148.291 143.833 193,713 106.697 104.087 100.778 93,383
Operating grants and contributions 1,647.981 2.400,540 2.340,267 1.965,936 1.785,809
Capital grants and contributions 15,266 8,659 27,239 129,032 9.480 23,969 22,894 14,735 24,990 3,666
Total business-type activities program
revenues 6,234.229 7,057,901 6,984,659 6,829,795 6,137,148 4,177.194 3.852.578 3,735,067 3,952,355 3,416,838
TOTAL PRIMARY GOVERNMENT
PROGRAM REVENUES $ 12,111,636 $ 14.089,234 $ 13.016.735 $ 17.148,108 $ 11.726.512 $ 14.694,802 $ 13.596.636 $ I 0,593,617 $ 14,331,825 $ 12.177.253
Net (Expense)IRevenue:
Governmental activities: (35.176.510) (32.400,769) (32.362.819) (33.644.949) (33.237.886) (26,650,992) (26,815.753) (26,785.800) (26.305,105) (23.489.51 0)
.!.. Busine.'is-type acti,•ities: 168,184 1,008,951 849,857 399,049 (140,794) (224.244) (356.110) (158,159) 315.544 (113.121)
~
TOTAL PRIMARY GOVERNMENT
NET (EXPENSE) $ (35,008,326) $ (31,391,818) $ (31,512,962) $ (33.245,900) $ (33.378,680) $ (26,875,236) $ (27.171,863) $ (26,943,959) $ (25,989,561) $ (23,602,631)
General Revenues and Other Changes
in Net Assets:
Governmemal activitie.'i:
Taxes and licenses:
Property taxes. levied for
general purposes $ 4,267,812 $ 4.402.226 $ 4.207.736 $ 3,986,760 $ 4.221.957 $ 4.122,538 $ 4.107.934 $ 3,919.113 $ 4.012.168 $ 3,893,211
Insurance premium tax 3.690.806 3.476.309 3.797.347 4,055,228 4.699.458 4,414,672 3.863,953 3,957.289 3.767.864 3.580,964
Gross receipts license tax 4,359,835 4.243,511 4.229.102 4,320,850 4,061.587 4,050,057 3,899.432 3,720.784 3.496,438 3.404,338
Employee license tax 18,095,182 17.345,033 16.384.509 16.584,636 16,520.523 16,273,966 14.794.217 11.192,445 10.616,223 10,301,231
Other taxes 2.711.924 2,712,817 2,844.154 2,776,407 2.259,956 1,964,101 2,105,014 2,116,403 1.764,140 1,893,064
Intergovernmental revenue 1.401.400 1.243,028 1.201,973 955,645 871,273 836,132
Unrestricted investment earnings 203,261 264.913 172.213 336,960 540,620 639,702 462.292 290,647 220,992 325.811
Gain on sale of capital assets 36,718 62.539 64.620 68.530 119,200 48,656 8.340 (1,972) 125.714
Insurance recoveries 27,448 410.462
Litigation settlement ( 1.482.743)
Transfers 270,620 (125.772) (78.893) (110,838) (96.609) (58,175) (115.754) (133,959) (68.964) 18,666
Total governmental activities 33.663,606 31.309.295 31.620.788 32,018,533 33.728.092 32,698,545 30,327.401 26,018,367 24,678.162 24.379,131
.!..
TABLE2
CITY OF PADUCAH, KENTUCKY
CHANGES IN NET ASSETS
Last Ten Fiscal Years
(accrual basis of ac:cmmti11g)
Fiscal Year
General Revenues and Other Changes 2012 2011 2010 (3) 2009 2008 (2) 2007
in Net Assets:
Bu.~i11ess-type tlc:ti••ities:
Unrestricted investment earnings $ 48.806 $ 46.052 $ 33.724 $ 52.961 $ 73.985 $ 83.854 $
Gain on sale of capital assets 2.443 67,657 1.112 98,369 127.131 16,641
Transfers (270,620) 125,772 78.893 110,838 96,609 58,176
Total business-type activities (219.371) 239.481 113.729 262.168 297.725 158,671
Change in Net Assets:
Govemmentaltlctivitie.~: (1.512.904) (1.091,474) (742.031) ( 1.626.416) 490.206 6.047,553
Busine.\·.Hype acti••ities: (51.187) 1.248.432 963.586 661.217 156.931 (65,573)
TOTAL PRIMARY GOVERNMENT $ ( 1,564,091) $ 156,958 $ 221.555 $ (965,199) $ 647,137 $ 5.981.980 $
( 1) Significant change in governmental and business-type net assets due to reclassification for prior year omitted receivables. capital assets. and post-closure landfill
expenses.
(2) The City began reporting Section Eight Housing fund as a business-type activity previously reported as a governmental fund. Prior years have not been restated.
(3) Significant change in governmental net assets due to restatement of prior year grant receivables.
Pages3of3
2006 2005 (1) 2004 2003
85.786 $ 51.508 $ 32.826 $ 39.530
55,337 27,500 34,975 24,238
115.754 133,959 68,964 (18,666)
256.877 212,967 136.765 45.102
3.511.648 (767,433) ( 1,626,943) 889.621
(99,233) 54,808 452.309 (68,019)
3.412.415 $ (712,625) $ (1,174,634) $ 821.602
.!...
N
9
General Fund:
Unassigned
TOTAL GENERAL FUND
All Other Governmental
Funds:
Restricted for:
Program purposes
Capital improvements
Committed for:
Capital improvements
Assigned for:
Program purposes
Capital improvements
TOTAL ALL OTHER
GOVERNMENTAL
FUNDS
2012
$11,321,438
$11,321,438
$ 1,236,780
286,276
2,631,233
472,235
1,487,938
$ 6,114,462
2011
$10,940,121
$10,940,121
$
2,587,012
683,578
2,133,786
$ 5,404,376
TABLE3
CITY OF PADUCAH, KENTUCKY
FUND BALANCES, GOVERNMENT FUNDS
Last Ten Fiscal Years
(modified accrual basis of accounting)
Fiscal Year
2010 (3) 2009 2007
$10,208,678 $ 10,31 I ,490
2008 (2)
$9,416,427 $9,976,079
$10,208,678 $10,311 ,490 $9,416,427 $9,976,079
$ $ $ $
2,844,706 2,618,147 2,081,280 1,692,872
1,402,731 1,634,547 1,193,968 1,543,547
5,151,791 1.745,766 2,947,140 2.926,051
$ 9,399,228 $ 5,998,460 $6,222,388 $6,162,470
2006
$9,157,310
2005 (1)
$8,303,702
$9,157,310 $8,303,702
$ $
719,801
1,573,977 1,548,082
1,970,003 940,323
$4,263,781 $2,488,405
( 1) Significant increase in general fund balance due to reclassification for prior year omitted license and tax receivables in the amount of $3,870.992.
(2) Significant decrease in reserve for program purpose due to converting governmental fund to proprietary fund.
(3) Significant decrease in general fund balance due to restatement of prior year grant receivables.
2004
$4,642,073
$4,642,073
$
1,284,119
3,886,391
$5,170,510
2003
$4,925,982
$4,925,982
$
1,821,307
3,583,589
$5,404,896
TABLE4
CITY OF PADUCAH, KENTUCKY
CHANGES IN FUND BALANCES, GOVERNMENTAL FUNDS
Last Ten Fiscal Years
(modified accrual basis of accounting)
Fiscal Year
Revenues: 2012 2011 2010 2009 2008 2007 2006 2005 2004 2003 (1)
Taxes $ 6,343,608 $ 6,223,511 $ 6,326,740 $ 5,867,782 $ 6,139,164 $ 6,044,069 $ 6,204,686 $ 6,016,570 $ 5,871,229 $ 5,773,871
Licenses 26,753,432 25,704,849 24,979,768 25,411,112 25,924,562 25,140,615 23,432,565 19,368,765 18,423,244 17,900,739
Charges for services 817,607 811,590 846,087 866,688 835,105 783,018 654,059 625,281 668,659 743,826
Intergovernmental 1,191,835 1,148,362 1,091,324 1,086,377 1,565,348 1,676,783 1,529,879 1,192,724 1,029,307 1,186,306
Grants 1,699,399 2,992,519 2,062,554 5,405,810 1,673,936 6,089,711 5,797,500 3,758,041 4,002,721 4,900,775
Interest 162,580 205,837 121,246 225,251 419,103 540.204 402,943 251,302 190,350 316,794
Miscellaneous 1,902,075 1,790,890 2,653,382 2,250,344 1,944,310 1,832,161 1,844,285 1,377,175 3,781,034 1,803,408
Total revenues 38,870,536 38,877,558 38,081,101 41.113,364 38,501,528 42,106,561 39,865,917 32,589,858 33,966,544 32,625,719
Expenditures:
General government 5,117,194 5,151,370 5,277,916 4,726,435 5,051,374 4,763,839 4,286,431 4,171.662 3,891,251 3,943,031
Public safety 18,479,428 16,854,136 15,999,437 15,599,613 15.696,728 14,759.735 14,366,846 14,376,161 12,963,685 12.535,382
Public service 5,596,702 6,446,503 5,984,115 7,855,846 7,935,188 7,226,542 7,418,656 5,947,105 6,914,523 5,995,396
Parks and recreation 2,677,781 2,781,663 2.582,382 1,490,732 1,298,329 1,192,727 1,044,299 1,045,024 1,026,297 975,361
Planning and development 2,216,665 1.680,297 1,868,369 1,811,083 803.976 2,424.198 2,545.227 2,267,774 2,570,473 2,204,395
Other 516,534 486,239 847,188 514,488 520,611 526,238 481,690 462,099 2,343,844 645,653
!.. Capital outlay 2,104,993 5,121,682 8,324,312 8,580,910 4.826.983 6,504,491 5,003,091 4,870,136 10,987,184 4,172,978 N
I Debt service:
Principal requirement 1,434.246 2,233,588 1,020,585 830,682 880,887 782,870 594.047 552.938 428,613 379,229
Interest and fiscal
requirement 1,114,852 1,519,329 1.077,128 1,003,439 1,051,008 1.108,385 949,537 745,676 471,625 428,578
Total expenditures 39,258,395 42,274,807 42,981,432 42,413,228 38,065,084 39,289,025 36,689,824 34,438,575 41,597,495 31,280,003
Other Financing Sources
(Uses):
Bonds issued 6,645,000 1,718,605 6,100,000 5,000,000
Long-term debt draws 101,983 366,039 1,222,390
Long-term debt issued 258,391 69,032 246,667 275,000 3,500,000
Capital lease 405,796 405,796 405,796 405,796 371,979
Transfers in 5,888,847 8,455,433 9.722,852 5.928,413 6,241,886 5,209,977 6,034,070 3,394,420 3,939,188 2,074,459
Transfers out (5,809,539) (8,201,253) (9,893,709) (6,150,847) (7 ,086,517) (5,556,722) (12,681 '180) (4,712,171) (5,295,576) (3,167,686)
Total other financing
sources (uses) 587,087 1,026,015 8,360,720 1,970,999 (472,652) (100,078) (547,110) (1,042,751) 7,143,612 ( 1 ,093,227)
NET CHANGE IN FUND
BALANCES $ 199,228 $ (2,371 ,234) $ 3,460,389 $ 671,135 $ (36,208) $ 2,717,458 $ 2,628,983 $ (2,891 ,468) $ (487,339) $ 252,489
Capital outlay (2) $ 2,156,290 $ 4,833,547 $ 8,763,073 $ 2,850,717 $ 2,857,189 $ 4,638,045 $ 3,779,542 $ 3,981,143 $ 9,144,907 $ 1,907,998
Debt service as a percentage
of noncapital expenditures 6.87% 10.02% 6.13% 4.64% 5.49% 5.46% 4.69% 4.26% 2.77% 2.75%
(1) The City implemented GASB 34, the new reponing standard, in fiscal year 2003.
(2) For repons after fiscal year 2002, capital outlay is reported on the Reconciliation of tire Statement of Revenues, Expenditures, and Changes in Fund Balances of Governmental
Funds to tire Statements of Activitie.~.
I -N
N
I
TABLES
CITY OF PADUCAH, KENTUCKY
ASSESSED AND ESTIMATED ACTUAL VALUE OF TAXABLE PROPERTY
LAST TEN FISCAL YEARS
Assessed Value Estimated
Fiscal Real Estate Personal Actual
Year Commercial Residential Property Franchise Total Value
2003 $ 592,033,879 $461,336,810 $453,327,389 $79,952,984 $ I ,586,65 I ,062 $1 ,647,809,422
2004 602,788,179 484,958,897 438,024,336 73,121,063 I ,598,892,475 I ,661 ,522,546
2005 622,478,658 500,350,485 425,304,684 74,460,202 I ,622,594,029 I ,684,469,469
2006 636,606,837 525,613,365 452,475,748 74,683,129 1,689,379,079 1 '750,930,676
2007 692,018,288 56 I , 151 ,216 482,481,332 51,455,1 I2 I,787,105,948 I ,847,595,428
2008 748,189,877 603,688,455 481 ,049,523 74,068,797 1 ,906,996,652 I ,970,156,891
2009 776,876,510 645,672,462 526,966,182 56,333,800 2,005,848,954 2,069,450,607
2010 797,902,456 659,381,375 495,273,730 57,459,000 2,0 I 0,0 16,561 2,076,961 ,686
2011 780,357,859 670,841 ,459 536,894,082 46,722,282 2,034,815,682 2,1 03, I 20,249
2012 781,685,815 685,984,380 524,400,400 61,500,830 2,053,571 ,425 2,122,076,341
Source: McCracken County Property Valuation Administrator
Notes: Property in McCracken county is reassessed once every four years on average.
Percent
Total Assessed
Direct To
Tax Estimated
Rate Value Exemptions
0.327 96.3% $60,184,497
0.326 96.2% 61,656,208
0.325 96.3% 60,901,557
0.325 96.5% 61,551,597
0.307 96.7% 60,489,480
0.287 96.8% 63,160,239
0.288 96.9% 63,601,653
0.286 96.8% 66,945,125
0.288 96.8% 68,304,567
0.287 96.8% 68,504,916
TABLE6
CITY OF PADUCAH, KENTUCKY
PROPERTY TAX RATES-DIRECT AND OVERLAPPING GOVERNMENTS
(PER $100 OF ASSESSED VALUE)
LAST TEN FISCAL YEARS
City Direct Rates
McCracken Co. City of Paducah Paducah McCracken
General Fund School Districts School Districts Junior College County
Total
Fiscal Real Direct Real Real Real Real
Year Estate Personal Rate Estate Personal Estate Personal Estate Personal Estate Personal
2003 0.300 0.390 0.327 0.396 0.396 0.598 0.603 0.022 0.022 0.196 0.221
2004 0.300 0.390 0.326 0.394 0.394 0.617 0.605 0.021 0.021 0.190 0.199
2005 0.300 0.390 0.325 0.448 0.448 0.618 0.617 0.021 0.021 0.196 0.226
I -N
0.390 0.433 0.619 0.020 0.021 0.197 0.236 v.> 2006 0.300 0.325 0.433 0.631 I
2007 0.275 0.390 0.307 0.433 0.433 0.628 0.631 0.019 0.019 0.197 0.236
2008 0.250 0.390 0.287 0.488 0.488 0.672 0.635 0.018 0.018 0.189 0.219
2009 0.250 0.390 0.288 0.489 0.491 0.672 0.678 0.021 0.023 0.096 0.106
2010 0.250 0.390 0.286 0.504 0.504 0.678 0.678 0.022 0.022 0.095 0.095
2011 0.250 0.390 0.288 0.504 0.504 0.711 0.711 0.016 0.020 0.095 0.098
2012 0.250 0.390 0.287 0.504 0.504 0.747 0.747 0.018 0.030 0.098 0.119
Source: McCracken County Property Valuation Administrator and City Tax Levy Ordinance.
Taxpayer
Kentucky Oaks Mall
Ducmall LLC
Paducah Medical Investors
Wai-Mart Real Estate Business
Sams Real Estate Business Trust
Computer Services Inc
Wal-Mart Store
USF Propco I LLC
Lowes Home Centers, Inc.
Brooks Properties, Inc.
Lourdes Medical Pavilion
Drury Inns, Inc.
Lowe's
TOTALS
TABLE7
CITY OF PADUCAH, KENTUCKY
PRINCIPAL TAXPAYERS -PROPERTY TAX
CURRENT YEAR AND NINE YEARS AGO
(1)
Assessed
Valuation
2012
(1)
Percentage of
Total Assessed
Valuation
(2)
Assessed
Valuation
$ 50,900,262
14,374,800
13,440,090
10,646,400
2.48%
0.70%
0.65%
0.52%
0.45%
0.44%
0.44%
0.40%
0.40%
0.38%
0.00%
0.00%
0.00%
$ 41,626,900
9,222,955
9,083,185
9,000,000
8,156,900
8,134,350
7,800,000
$140,758,942 6.86%
13,440,090
14,257,212
33,851,922
19,511,911
13,266,765
13,669,186
$149,623,986
(1) Source-Property Valuation Administration; Assessed value as of January 1, 2011.
(2) Source-Property Valuation Administration; Assessed value as of January I, 2002.
-124-
2003
(2)
Percentage of
Total Assessed
Valuation
2.99%
0.00%
0.97%
0.00%
0.00%
1.03%
2.43%
0.00%
0.00%
0.00%
1.40%
0.95%
0.98%
10.75%
TABLES
CITY OF PADUCAH, KENTUCKY
SECURED TAX LEVIES AND COLLECTIONS*
LAST TEN FISCAL YEARS
Collected within the
Fiscal Year of the Levy Total Collections to Date
Fiscal (1)
Year Taxes Levied (1) Percent of Collections Percent of
Ended for the Amount of Levy in Subsequent Total Levy
June 30, Fiscal Year Collections Collected Years Collections Collected
2003 $3,667,689 $3,414,329 93.1% $ 244,649 $ 3,658,978 99.8%
2004 3,800,967 3,685,957 97.0% 105,579 3,791,536 99.8%
2005 3,834,706 3,762,592 98.1% 62,532 3,825,124 99.8%
2006 4,014,042 3,911,868 97.5% 90,078 4,001,946 99.7%
2007 4,000,362 3,855,679 96.4% 130,291 3,985,970 99.6%
2008 3,974,933 3,814,940 96.0% 144,682 3,959,622 99.6%
2009 4,201,796 4,017,032 95.6% 156,868 4,173,900 99.3%
2010 4,258,210 4,131,454 97.0% 94,305 4,225,759 99.2%
2011 4,199,308 4,110,973 97.9% 41,447 4,152,420 98.9%
2012 4,233,693 4,119,689 97.3% 4,119,689 97.3%
(I) Includes current year rea] and persona] property tax.
* Source -City of Paducah Finance Department.
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TABLE9
CITY OF PADUCAH, KENTUCKY
EMPLOYEE LICENSE TAX COLLECTIONS
LAST TEN FISCAL YEARS
Fiscal
Year
2003
2004
2005
2006
2007
2008
2009
20IO
20II
20I2
(1)
Taxes
Collected
$ 10,30I ,23I
10,6I6,222
II,l83,I57
I4,947,835
16,258,946
16,535,542
16,584,618
16,384,509
17,345,034
18,095,I82
$I48,252,276
Direct
Tax
Rate
1.50%
1.50%
1.50%
2.00% (2)
2.00%
2.00%
2.00%
2.00%
2.00%
2.00%
(I) Source -City of Paducah Finance Department -Actual collections during the fiscal year.
(2) Effective October I, 2005, employee license tax rate increased from 1.5% to 2.0%.
-I26-
Taxpayers
By Range
$0-$50,000
$50,00 1 -$100,000
$100,001 -$500,000
Greater than $500,000
TOTALS
Taxpayers
By Range
$0-$50,000
$50,001 -$100,000
$100,001 -$500,000
Greater than $500,000
TOTALS
TABLE 10
CITY OF PADUCAH, KENTUCKY
PRINCIPAL EMPLOYEE LICENSE TAXPAYERS
CURRENT YEAR AND SIX YEARS AGO*
2012
(1)
Number of Percentage Taxes
Filers of Total Collected
2,466 97.82% $ 8,496,955
31 1.23% 2,198,285
22 0.87% 4,363,850
2 0.08% 3,036,092
2,521 100.00% $18,095,182
2006
(1)
Number of Percentage Taxes
Filers of Total Collected
1,603 97.80% $ 7,462,359
19 1.16% 1,326,451
15 0.92% 2,907,406
2 0.12% 1,879,464
1,639 100.00% $13,575,680
( 1) Source -City of Paducah Finance Department -Actual collections during the fiscal year.
*Principal employee license taxpayers six years ago is the earliest date this statistic is available.
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Percentage of
Total Employee
License Tax
46.96%
12.15%
24.11%
16.78%
100.00%
Percentage of
Total Employee
License Tax
54.97%
9.77%
21.42%
13.84%
100.00%
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00
I
Net
General Public
Fiscal Obligation Improvement
Year Bonds Debt
2003 $ 8,803,949 $
2004 13,589,757 3,428,855
2005 13,210,195 3,503,274
2006 18,877,636 3,319,227
2007 18,278,164 3,320,522
2008 17,614,952 2,946,303
2009 19,706,394 5,187,262
2010 25,568,996 5,808,267
2011 24,805,676 4,910,742
2012 23,616,405 7,320,328
TABLE 11
CITY OF PADUCAH, KENTUCKY
RATIO OF OUTSTANDING DEBT BY TYPE
LAST TEN FISCAL YEARS
Net Net
Public Refunding Total
Capital Improvement Revenue Primary
Lease Debt Bonds Government
$79,825 $ $ $ 8,883,774
17,018,612
16,713,469
22,196,863
21,598,686
20,561,255
24,893,656
31,377,263
29,716,418
30,936,733
Notes: Details regarding the City's outstanding debt can be found in the notes to the financial statements.
(1)
Ratio of
Net
Debt to
Actual
Value
0.54
1.02
0.99
1.27
1.17
1.04
1.20
1.51
1.41
1.46
(I) See Table 5 for estimated actual property value. This ratio is calculated using estimated property value for the prior year.
(2) See Table 15 for population data.
(3) See Table 15 for personal income data
(3)
Net Debt as (2)
Percentage Net
of Personal Debt Per
Income Capita
1.83% $ 338
3.51% 647
3.45% 635
4.58% 844
4.46% 821
4.24% 782
5.14% 946
6.48% I ,193
5.91% 1,188
6.15% 1,236
~
N
'P
Police and
Convention and Fire Pension
Fiscal Art Center Fund
Year Bonds Bonds
2003 $8,850,000 $
2004 8,620,000
2005 8,380,000
2006 8,130,000 6,100,000
2007 7,870,000 5,925,000
2008 7,600,000 5,740,000
2009 7,320,000 5,545,000
2010 7,030,000 5,340,000
2011 7,040,000 5,125,000
2012 6,630,000 4,895,000
TABLE12
CITY OF PADUCAH, KENTUCKY
RATIO OF NET GENERAL BONDED DEBT OUTSTANDING
LAST TEN FISCAL YEARS
General Bonded Debt Outstanding
Infiniti Public Less
Media Flood wall Improvement Resources
Building Rehabilitation Project Restricted for
Bonds Bonds Bonds Debt Service
$ $ $ $ 46,051
5,000,000 30,246
4,840,000 9,805
4,680,000 32,364
4,515,000 31,836
4,340,000 65,048
4,160,000 2,774,638 93,244
3,975,000 2,671,440 6,645,000 92,444
3,780,000 2,564,948 6,370,000 74,272
3,571,283 2,455,210 6,100,000 35,088
Notes: Details regarding the City's outstanding debt can be found in the notes to the financial statements.
( 1) See Table 5 for estimated actual property value. This ratio is calculated using estimated property value for the prior year.
(2) See Table 15 for population data.
(1)
Ratio of
Net (2)
Bonds to Net
Actual Bonds Per
Total Value Capita
$ 8,803,949 0.53 $ 335
13,589,754 0.82 517
13,210,195 0.78 502
18,877,636 1.08 718
18,278,164 0.99 695
17,614,952 0.89 670
19,706,394 0.95 749
25,568,996 1.23 972
24,805,676 1.18 991
23,616,405 1.1 1 944
TABLE 13
CITY OF PADUCAH, KENTUCKY
DIRECT AND OVERLAPPING GOVERNMENTAL ACTIVITIES DEBT
AS OF JUNE 30, 2012
(1)
Percentage
Net Debt Applicable
Outstanding to the City
City of Paducah $ 30,936,733 100.00%
Paducah Independent School District 4 7,227,403 * 100.00%
McCracken County 19,768,049 * 45.60%
McCracken County Board of Education 77,347,922 * 30.90%
Overlapping debt 144,343,374
TOTAL DIRECT AND OVERLAPPING DEBT $175,280,107
Estimated
Share of
Direct and
Overlapping
Debt
$ 30,936,733
47,227,403
9,014,230
23,900,508
80,142,141
$111,078,874
( 1) Applicable percentage is determined by ratio of assessed valuation of property subject to taxation
in overlapping unit to valuation of property subject to taxation in reporting unit.
* Information from finance office at each location.
-130-
Net assessed value
Add exemption
Total assessed value
Debt limit -I 0% of total assessed (I)
Debt outstanding:
General obligation bonds outstanding
Note payable
Less debt not subject to limit
Gross bonded debt
Less amount available in debt service
funds
Net bonded indebtedness subject to
limit
LEGAL DEBT MARGIN
2012 2011 2010
TABLE14
CITY OF PADUCAH, KENTUCKY
LEGAL DEBT MARGIN INFORMATION
LAST TEN FISCAL YEARS
Fiscal Year
2009 2008 2007 2006 2005
$ 23.651 ,493
7,320,328
30,971,821
35.088
2004
$ 2,053,571 ,425
68,504,916
$2.122,076,341
$ 212,207,634
30,936,733
$ 181,270,901
2003
Debt limit $ 212.207,634 $ 210,312,025 $ 207,696,169 $ 206,945,061 $ 197,015,689 $ 182,759,543 $ 175,093,068 $ 168,349,559 $ 166,054,868 $ 164,683.556
Total net debt
applicabletolimit 30,936,733 29,716.418 31.377,263 24,893,656 20,561,255 21.598,686 22.196,863 16,713,469 17,018,612 8,883,774
LEGAL DEBT
MARGIN $ 181.270,901 $ 180,595,607 $ 176,318,906 $ 182,051,405 $ 176,454,434 $ 161, 160,857 $ 152,896,205 $ 151 ,636,090 $ 149,036,256 $ 155,799,782
Total net debt
applicable to the
limited as a
percentage of
debt limit 14.58% 14.13% 15.11% 12.03% 10.44% 11.82% 12.68% 9.93% 10.25%
(I) "Cities shall not be authorized or permitted to incur indebtedness to an amount. including existing indebtedness, in the aggregate exceeding the following names maximum percentages on the value
of the taxable property therein, to be estimated by the assessment previous to the incurring of the indebtedness: Cities of the first and second classes. and of the third class having a population
exceeding fifteen hundred, ten per centum."
5.39%
TABLE 15
CITY OF PADUCAH, KENTUCKY
DEMOGRAPHIC AND ECONOMIC STATISTICS
LAST TEN FISCAL YEARS
(1) (1) (1) (1) (2) (3)
Personal Per Capita Median School Unemployment
Fiscal Year Population Income Income Age Enrollment Rate
2002-2003 26,307 $484,496,0 19 $I8,417 39.9 2,887 7.2%
2003-2004 26,307 484,496,0 19 I8,417 39.9 2,977 5.8%
2004-2005 26,307 484,496,019 I8,417 39.9 2,8I9 6.4%
2005-2006 26,307 484,496,0 I9 18,4I7 39.9 2,834 5.7%
2006-2007 26,307 484,496,0 I9 18,417 39.9 2,804 5.6%
2007-2008 26,307 484,469,019 18,417 39.9 2,832 6.I%
2008-2009 26,307 484,469,0I9 I8,4I7 39.9 2,774 9.3%
2009-20IO 26,307 484,469,0 19 I8,417 39.9 2,659 8.5%
2010-2011 25,024 503,179,300 20,430 41.4 2,789 8.7%
20II-20I2 25,024 503,179,300 20,430 41.4 2,682 8.0%
Sources:
(I) Bureau of the Census Count -20 I 0, 2000
(2) Board of Education; represents elementary and secondary public schools.
(3) Kentucky Cabinet for Human Resources, Department for Employment Services.
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I -VJ
VJ
I
Employer
Western Baptist Hospital
Lourdes Hospital
Wai-Mart
Paducah Public Schools
West Kentucky Community and Technical College
City of Paducah
State of Kentucky
LYNX Services
Paxton Media Group
Computer Services, Inc.
TOTALS
(I) Source -City of Paducah Finance Department
TABLE 16
CITY OF PADUCAH, KENTUCKY
PRINCIPAL EMPLOYERS
CURRENT YEAR AND SIX YEARS AGO*
Employees (1)
1794
1541
1098
554
507
391
322
266
249
237
6,959
2012
Percentage of
Total
Employment (2)
6.03%
5.18%
3.69%
1.86%
1.70%
1.31%
1.08%
0.89%
0.84%
0.80o/o
23.38%
Employees (1)
1,660
1,500
570
600
270
380
390
390
285
280
6,325
(2) State of Kentucky -Office of Employment and Training. Ratio based on employment within County of McCracken.
* Principal employers six years ago is the earliest date this statistic is available.
2006
Percentage of
Total
Employment (2)
5.55%
5.01%
2.01%
1.91%
0.90%
1.27%
1.30%
1.30%
0.95%
0.94%
21.14%
TABLE17
CITY OF PADUCAH, KENTUCKY
CITY FULL-TIME EMPLOYEES BY FUNCTION*
Last Ten Fiscal Years
Fiscal Year
2012 2011 2010 2009 2008 2007 2006 2005 2004 2003
Governmental Activities
General government
General administration 12 12 12 12 12 12 12 11 11 11
Finance 11 14 14 17 14 14 14 13 13 13
Inspection 11 11 10 13 13 13 12 12 12 12
Information systems 6 6 6 4 4 4 3 3 3 3
Risk/Human resources 3 1 1 1 4 4 4 4 3 3
Public safety
Police 90 90 90 93 93 93 93 96 94 95
Fire 64.5 64 65 69 69 71 76 75 76 76
Public service
Streets 23 23 23 29 29 30 31 28 28 28
I Facilities 11.5 14 34 36 35 34 35 38 39 39 -w
~ Engineering 7.6 7 5 8 9 9 9 9 8 8 I
Other 5 6 4 6 6 6 4 4 2 2
Parks and recreation 24 24 7 7 7 7 7 9 9 8
Planning and development 9 9 9 10 11 I I 11 1 I 11 11
Other
Paducah Riverfront Dev. Authority I 0 0 0 0 0 0 0 0 0
Renaissance 4 5 3 5 0 0 0 0 0 0
Fleet maintenance 6.5 6 8 6 7 7 7 7 6 6
Business-tJ!.ee Activities
Solid waste 25.4 26 27 27 27 27 29 29 29 29
TOTAL PRIMARY GOVERNMENT 314.5 318 318 343 340 342 347 349 344 344
* Employee budget census.
TABLEtS
CITY OF PADUCAH, KENTUCKY
OPERATING INDICATORS BY FUNCTION**
Last Ten Fiscal Years
2012 2011 2010 2009 2008 2007 2006 2005 2004 2003
General government
Building and electrical
permits issued 1,232 1,239 1,263 I, 179 1,203 1,411 1,362 1,376 * *
Business licenses issued 3,956 3,254 3,397 3,691 3,507 3,500 3,700 * * *
Public safety
Police
Adult arrests 2,753 3,564 3,859 4,454 4,170 5,012 3,827 * * *
Murder 3 3 I 5 * * *
Rape 14 22 12 20 15 18 15 * * *
Robberies 14 31 56 41 49 42 35 * * *
Burglary 123 155 245 169 203 208 211 * * *
Auto theft 47 54 62 57 60 117 104 * * *
Arson 7 6 7 7 8 16 7 * * *
Traffic accidents 1,666 1,762 1,774 1,368 1,519 1,949 1,815 * * *
Traffic violations 8,573 7,701 7,240 9,143 7,109 7,323 7,468 * * *
Fire
Emergency responses 3,164 3,181 2,603 3,305 2,603 2,456 2,546 3,219 3,638 3,569
!.. Fires extinguished 138 122 133 136 102 163 181 176 189 198 w
"f Structure fires 53 37 49 57 49 40 53 49 64 70
Incidents with reported losses 89 73 89 85 70 80 91 97 106 111
Medical/rescue 2,270 2,133 1,690 1,616 1,506 1,369 1,589 1,997 2,266 2,290
Tours/in-services/car seats 524 671 676 907 699 485 485 485 485 485
Training man hours 7,232 7,033 8,493 7,716 4,344 1,183 I ,418 1,188 965 1,058
Inspections I ,417 1,063 985 1,183 1,449 * * * * *
Refuse collection
Residential
Refuse collected (tons 34 34 38 32 25 28 34 * * *
per day)
Customers served 9,488 9,568 9,445 9,435 9,446 9,388 9,368 * * *
Commercial
Refuse collected (tons 71 71 70 75 83 85 84 * * *
per day)
Customers served 803 806 810 810 821 832 801 * * *
Public service
911 dispatches 79,333 82,268 79,768 81,525 83,871 76,815 83,348 85,273 91,408 92,698
Police 43,686 44,794 42,496 40,921 43,420 41,887 47,091 48,275 53,504 54,521
Fire 3,189 3,226 2,702 2,490 2,720 2,399 2,907 3,424 4,190 4,058
Other 32,458 34,248 34,570 38,114 37,731 32,529 33,350 33,574 33,714 34,119
* Information not available.
** Information from city departments.
TABLE19
CITY OF PADUCAH, KENTUCKY
CAPITAL ASSET STATISTICS BY FUNCTION*
Last Ten Fiscal Years
Fiscal Year
2012 2011 2010 2009 2008 2007 2006 2005 2004 2003
Public safety
Police
Stations
Fire
Stations 5 5 5 5 5 5 5 5 5 5
Refuse collection
Collection trucks
Residential IO 9 9 7 10 9 8 8 # #
Commercial 4 4 5 4 5 5 4 4 # #
Other public works
Streets (miles paved) 2I8 218 2I8 216 216 2I6 214 2I4 213 209
I Sidewalks (miles) 47 47 47 45 45 45 45 45 45 -45 w
0\ Traffic signals 13 13 13 12 1I II I1 I1 10 0 I
Parks and recreation
Parks 27 27 27 27 27 27 18 18 18 18
Acreage 1290 1290 1290 960 960 960 325 325 325 325
Community centers 2 2 1 1 I 1 1 I 1 1
Swimming pools 1 1 1 1 1 I I 1 1 3
Public tennis courts 6 6 6 6 6 6 6 6 6 6
Public golf courses 2 2 2 2 2 2 2 2 2 2
# Information not available.
* Information from city departments.
CITY OF PADUCAH, KENTUCKY
SINGLE AUDIT SECTION
COMPREHENSIVE ANNUAL FINANCIAL REPORT
YEAR ENDED JUNE 30, 2012
CITY OF PADUCAH, KENTUCKY
SCHEDULE OF EXPENDITURES OF FEDERAL AWARDS
FOR THE YEAR ENDED JUNE 30, 2012
Federal Grantor/Pass-Through Grantor/
Program Title:
Department of Housing and Urban
Development:
Direct Programs:
Section 8 Housing Choice Vouchers
Passed-through Kentucky Governors
Office for Local Development:
Community Development Block Grant
Passed-through Kentucky Housing
Corporation:
Home Investment Partnerships Program
Total Department of Housing and Urban
Development
Department of Justice:
Direct Programs:
Bulletproof Vest Partnership Program
Edward Byrne Memorial Justice
Assistance Grant Program
ARRA -Community Oriented
Policing Services
Total Department of Justice
Department of Homeland Security:
Passed-through Kentucky Office of
Homeland Security:
Homeland Security Grant Program
Homeland Security Grant Program
Homeland Security Grant Program
Total Department of Homeland Security
Department of Transportation:
Passed-through Kentucky Department
of Transportation:
State and Community Highway Safety
State and Community Highway Safety
Total Department of Transportation
Department of Interior:
Passed-through National Park Service:
Preserve America Grant Program
Total Department of Interior
TOTAL EXPENDITURES OF FEDERAL AWARDS
Federal
CFDA
Number
14.871
14.228
14.239
16.607
16.738
16.710
97.067
97.067
97.067
20.600
20.600
15.904
See accompanying notes to schedule of expenditures of federal awards.
-137-
Pass-Through
Grantor Number
N/A
05-019
GF12-0198-01
N/A
20 11-DJ-BX-3048
2009-RK-WX-0377
P02 094 1000002706 I
P02 094 1 000002289 1
P02 094 1000002967 1
PT-11-36
PT-12-40
21-11-31924
Amount
Expenditures
$1,631,929
560,355
38,000
2,230,284
3,163
23,121
146,857
173,141
54,848
13,041
60,000
127,889
19,887
37,840
57,727
4,950
4,950
$2,593,991
CITY OF PADUCAH, KENTUCKY
NOTES TO THE SCHEDULE OF EXPENDITURES OF FEDERAL A WARDS
FOR THE YEAR ENDED JUNE 30, 2012
Note 1-Basis ofPresentation:
The accompanying schedule of expenditures of federal awards includes the federal grant activity of
the City of Paducah and is presented on the accrual basis of accounting. The information in this
schedule is presented in accordance with the requirements of OMB Circular A-133, Audits of States,
Local Governments, and Non-Profit Organizations. Therefore, some amounts presented in this
schedule may differ from amounts presented in, or used in the preparation of, the financial
statements.
Note 2 -Subrecipients:
The City of Paducah provided federal awards to subrecipients as follows:
Program Title
Four Rivers Recovery Center
-138-
Federal
CFDA
Number
14.228
Amount
Provided
$560,355
THIS PAGE INTENTIONALLY LEFT BLANK
J. DAVID BAILEY. Ill
c. SUZETTE CRONCH
ROGER G. HARRIS
MICHAEL F. KARNES
ROBERT R. ROBERTSON
MARK A. THOMAS
G. LEON WILLIAMS. 1926-2004
H. WILLIAM LENTZ. 1925-2007
J. RICHARD WALKER
JERRY G. SEVERNS
WILLIAMS, WILLIAMS & LENTZ, LLP
CERTIFIED PUBLIC ACCOUNTANTS
601 JEFFERSON
PADUCAH,KENTUCKY42001
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
Honorable William F. Paxton, Mayor
Members of the Board of Commissioners
City of Paducah
Paducah, Kentucky
MAILING AQQRESS
POST OFFICE BOX 2500
PADUCAH, KY 42002·2500
~
270-443-3643
EM
270-444·0652
We have audited the financial statements of the governmental acttvtttes, the business-type activities, the
aggregate discretely presented component units, each major fund, and the aggregate remaining fund
information of the City of Paducah, Kentucky, as of and for the year ended June 30, 2012, which collectively
comprise the City of Paducah, Kentucky's basic financial statements and have issued our report thereon dated
December 11, 2012. Our report includes a reference to other auditors. 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.
Other auditors audited the financial statements of the Transit Authority of the City of Paducah, a component
unit, as described in our report on the City of Paducah, Kentucky's financial statements. This report does not
include the results of the other auditor's testing of internal control over financial reporting or compliance and
other matters that are reported on separately by those auditors.
Internal Control Over Financial Reporting
Management of the City of Paducah, Kentucky, is responsible for establishing and maintaining effective
internal control over financial reporting. In planning and performing our audit, we considered the City of
Paducah, Kentucky's internal control over financial reporting as a basis for designing our auditing procedures
for the purpose of expressing our opinions on the financial statements, but not for the purpose of expressing an
opinion on the effectiveness of the City of Paducah, Kentucky's internal control over financial reporting.
Accordingly, we do not express an opinion on the effectiveness of the City of Paducah, Kentucky'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.
Our consideration of internal control over financial reporting was for the limited purpose described in the first
paragraph of this section and was not designed to identify all deficiencies in internal control over financial
reporting that might be deficiencies, significant deficiencies, or material weaknesses. We did not identify any
deficiencies in internal control over financial reporting that we consider to be material weaknesses, as defined
above.
-139-
Compliance and Other Matters
As part of obtaining reasonable assurance about whether the City of Paducah, Kentucky'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.
We noted certain matters that we reported to management of the City of Paducah, Kentucky, in a separate
letter dated December 11 , 20 12.
This report is intended solely for the information and use of management, City Commission, others within the
entity, and federal awarding agencies and pass-through entities and is not intended to be and should not be
used by anyone other than these specified parties.
H~ttJ~~ ~.z.;tJ / d'
December 11, 20 12
-140-
J. DAVID BAILEY. Ill
C. SUZETTE CRONCH
ROGER G. HARRIS
MICHAEL F. KARNES
ROBERT R. ROBERTSON
MARK A. THOMAS
G.LEONWILUAMS. 1926-2004
H. WILLIAM LENTZ. 1925-2007
J. RICHARD WALKER
JERRY G. SEVERNS
WILLIAMS, WILLIAMS & LENTZ, LLP
CERTIFIED PUBLIC ACCOUNT ANTS
601 JEFFERSON
PADUCAH, KENTUCKY 42001
Independent Auditor's Report on Compliance with
Requirements That Could Have a Direct and Material Effect
on Each Major Program and on Internal Control Over
Compliance in Accordance with OMB Circular A-133
Honorable William F. Paxton, Mayor
Members of the Board of Commissioners
City of Paducah
Paducah, Kentucky
Compliance
MAILING AQQRESS
POST OFFICE BOX 2500
PADUCAH. KY 42002-2500
~
27().443.3643
w
270-444·0652
We have audited the compliance of the City of Paducah, Kentucky, with the types of compliance requirements
described in the U.S. Office of Management and Budget (OMB) Circular A-133 Compliance Supplement that
are applicable to each of its major federal programs for the year ended June 30, 2012. The City of Paducah,
Kentucky's major federal programs are identified in the summary of auditor's results section of the
accompanying schedule of findings and questioned costs. Compliance with the requirements of laws,
regulations, contracts, and grants applicable to each of its major federal programs is the responsibility of the
City of Paducah, Kentucky's management. Our responsibility is to express an opinion on the City of Paducah,
Kentucky's compliance based on our audit.
We conducted our audit of compliance in accordance with auditing standards generally accepted in the United
States of America; the standards applicable to financial audits contained in Government Auditing Standards,
issued by the Comptroller General of the United States; and OMB Circular A-133, Audits of States, Local
Governments, and Non-Profit Organizations. Those standards and OMB Circular A-133 require that we plan
and perform the audit to obtain reasonable assurance about whether noncompliance with the types of
compliance requirements referred to above that could have a direct and material effect on a major federal
program occurred. An audit includes examining, on a test basis, evidence about the City of Paducah
Kentucky's compliance with those requirements and performing such other procedures as we considered
necessary in the circumstances. We believe that our audit provides a reasonable basis for our opinion. Our
audit does not provide a legal determination of the City of Paducah, Kentucky's compliance with those
requirements.
In our opinion, the City of Paducah, Kentucky complied, in all material respects, with the compliance
requirements referred to above that could have a direct and material effect on each of its major federal
programs for the year ended June 30, 20 12.
Internal Control Over Compliance
The management of the City of Paducah, Kentucky, is responsible for establishing and maintaining effective
internal control over compliance with requirements of laws, regulations, contracts, and grants applicable to
federal programs. In planning and performing our audit, we considered the City of Paducah, Kentucky's
internal control over compliance with the requirements that could have a direct and material effect on a major
federal program in order to determine our auditing procedures for the purpose of expressing our opinion on
compliance, but not for the purpose of expressing an opinion on the effectiveness of internal control over
compliance. Accordingly, we do not express an opinion on the effectiveness of City of Paducah, Kentucky's
internal control over compliance.
-141-
A deficiency in internal control over compliance exists when the design or operation of a control over
compliance does not allow management or employees, in the normal course of performing their assigned
functions, to prevent, or detect and correct, noncompliance with a type of compliance requirement of a federal
program on a timely basis. A material weakness in internal control over compliance is a deficiency, or
combination of deficiencies, in internal control over compliance, such that there is a reasonable possibility that
material noncompliance with a type of compliance requirement of a federal program will not be prevented, or
detected and corrected, on a timely basis.
Our consideration of internal control over compliance was for the limited purpose described in the first
paragraph of this section and would not necessarily identify all deficiencies in internal control that might be
significant deficiencies or material weaknesses. We did not identify any deficiencies in internal control over
compliance that we consider to be material weaknesses, as defined above.
This report is intended solely for the information and use of management, City Commission, others within the
entity, federal awarding agencies, and pass-through entities and is not intended to be and should not be used by
anyone other than these specified parties.
IU'~~~,;~.z~ / t:YI
December II, 20 12
-142-
CITY OF PADUCAH, KENTUCKY
SCHEDULE OF FINDINGS AND QUESTIONED COSTS
FOR THE YEAR ENDED JUNE 30,2012
A. Summary of Audit Results:
1. The auditor's report expresses an unqualified opinion on the basic financial statements of the City of
Paducah, Kentucky.
2. No instances of a significant control deficiency were disclosed during the audit of the basic financial
statements of the City of Paducah, Kentucky.
3. No instances of noncompliance material to the basic financial statements of the City of Paducah,
Kentucky were disclosed during the audit.
4. No instances of significant deficiencies were disclosed during the audit of the major federal award
programs.
5. The auditor's report on compliance for the major federal award programs for the City of Paducah,
Kentucky expresses an unqualified opinion.
6. There are no audit findings relative to the major federal awards program to be reported.
7. The programs tested as major programs included:
Name
Section 8 Housing Choice Vouchers
Community Development Block Grant
8. The threshold for distinguishing Types A and B programs was $300,000.
9. The City of Paducah, Kentucky was determined to be a low-risk auditee.
B. Findings -Basic Financial Statements Audit:
None
C. Findings and Questioned Costs -Major Federal Award Programs:
None
-143-
CFDA#
14.871
14.228
CITY OF PADUCAH, KENTUCKY
SCHEDULE OF PRIOR AUDIT FINDINGS
FOR THE YEAR ENDED JUNE 30, 2012
Findings -Financial Statements Audit:
None
Findings and Questioned Costs -Major Federal Awards Programs:
None
-144-